Broadcom CEO sees AI chip sales topping $128 billion in 2027

Seattle – Broadcom chief executive Tan Hock Eng said the company expects its artificial intelligence chip sales to top US$100 billion (S$128 billion) in 2027, marking major inroads into territory dominated by Nvidia. 

“We have line of sight” to reach this milestone in 2027, he said during a conference call on March 4 with analysts. “We have also secured the supply chain required to achieve this.”

The company projects AI chip revenue to be US$10.7 billion in the current quarter, so reaching the US$100 billion annual pace would be a major jump. Broadcom’s shares gained about 4 per cent in late trading on Mr Tan’s remarks. 

The CEO has increasingly tried to hitch Broadcom’s fortunes to AI. Though Nvidia remains the biggest maker of accelerators – the chips that help train and run artificial intelligence models – Broadcom has positioned itself as an alternative with its custom-made semiconductors.

The company’s AI chip targets include both accelerators and networking chips. 

Broadcom also delivered a better-than-estimated quarterly outlook on March 4 and announced a stock buyback plan worth as much as US$10 billion.

Revenue will be about US$22 billion in the fiscal second quarter, which ends May 3, the company said.

Analysts had predicted US$20.5 billion on average, though some projections topped US$22 billion, according to data compiled by Bloomberg.

The company had faced scepticism about its AI prospects in 2026, with Broadcom shares falling 8.3 per cent through the close on March 4.

Investors have grown more concerned about a bubble in AI spending, and even a blockbuster earnings report from Nvidia in February led to a stock sell-off. One key question is whether the current AI wave will extend beyond the next few years.

Broadcom had seen its valuation surge in recent years, helped by deals to make custom AI chips for companies like OpenAI and Anthropic.

Its prospects have also benefited from increased interest in Google’s TPU, or tensor processing unit, a chip that Broadcom helps develop for the search giant.

And Broadcom just shipped the first units of a new generation of processors that it said will be adopted by about a half-dozen more clients in 2026.

Mr Tan said on the conference call that he expects OpenAI to begin shipping its Broadcom chip in volume next year, reaching more than 1GW of computing capacity.

He also said that demand for Google’s TPU is strong and will accelerate further in 2027. Broadcom plans to ship chips to Anthropic, which is using Google’s TPUs, to enable 1GW of capacity in 2026 and more than 3GW in 2027.

Beyond Broadcom’s custom AI chip work, the company continues to update its networking equipment to better link up the computing needed to run AI models. Mr Tan also has built a large software operation through acquisitions. BLOOMBERG