2024-04-09 08:42:32 ET
Broadcom Inc (NASDAQ: AVGO) is in focus today after JPMorgan analysts said it is warming up to launch its 3nm AI accelerator custom chip programmes.
Google and Meta to boost revenue
The investment bank expects the multinational to release the said AI TPU ASIC with Google (TPU v6) and Meta (MTIA TPU) before the back half of this year.
Production, they added, will then ramp up through 2025. Their research note reads:
We estimate that Google and Meta combined with drive $9B+ in AI ASIC chip revenues for Broadcom this year – up almost 2.5x over CY23.
The news arrives about a month after cited artificial intelligence tailwinds as it reported market-beating financial results for its first quarter ( read more ).
Is Broadcom stock worth owning in 2024?
JPMorgan see Meta Platforms to be a “multi-billion dollar per year AI ASIC customer” for Broadcom from 2025.
The investment bank expects the $619 billion behemoth based out of San Jose, California to generate up to $12 billion in total from AI semiconductor shipments in 2024.
Its analysts’ view is based on solid demand not just for PCIe Gen5/Gen6 switching solutions but for its Jericho 3 and Tomahawk 5 as well on the back of continued focus on artificial intelligence.
JPMorgan had previously called Broadcom stock the “ biggest AI play after Nvidia ”. It sees upside in its shares to $1,550 – up another 15% from here.
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