Broadcom CEO Hock Tan speaks at the Digital X event in Cologne, Germany on September 13, 2022.
Ying Tan | Null Photo | Getty Images
broadcom Shares rose slightly in after-hours trading Wednesday after the company announced rosy outlook for next year and hinted at growing business with the Artificial Intelligence Research Institute.
Here’s how the company performed compared to the LSEG consensus:
Earnings per share: $3.32 adjusted vs. $3.24 expected Sales: $29.59 billion vs. $29.36 billion expected
For the fiscal fourth quarter, Broadcom expects revenue to be $34.8 billion, compared with analysts’ expectations of $35.03 billion, LSEG said.
Broadcom’s revenue increased 86% in the quarter from $15.95 billion in the same period last year, the company said in a statement. Net income more than tripled to $13.09 billion, or $2.68 per share, from $4.14 billion, or 85 cents per share, in the same period last year.
Broadcom is one of the major winners of the AI boom, designing custom chips for companies such as: google, meta and OpenAI. Coinciding with the emergence of ChatGPT and other generative AI services, the stock price has soared more than sixfold since the end of 2022, pushing its market capitalization to about $1.8 trillion.
But stocks have lagged broader indexes this year. As of Wednesday’s close, Broadcom stock was up about 6% in 2026, while the S&P 500 index was up 12% over the same period.
During the quarter, Broadcom promoted a custom Jalapeno chip co-developed with OpenAI. apple He said he would increase investment in Broadcom for U.S. chip production.
CEO Hock Tan said on a conference call that he expects Broadcom to accelerate shipments of Google Ironwood tensor processing units to Anthropic and TPU 8i chips. google.
He said Broadcom will deliver tens of billions of dollars worth of processors to Google each year for the next several years.
“Jalapeño shipments for OpenAI will continue. metawe look forward to production shipping of custom MTIA accelerators optimized for large-scale inference and recommendation,” said Tan.
Broadcom is looking for Anthropic to deploy 5 gigawatts of TPU 8i chips in 2027, with prospects to deliver an additional 10 gigawatts, Tan said. Tan said OpenAI is preparing to tape out a second-generation chip, and the institute is finalizing plans for a third version with Broadcom.
He said Broadcom is considering installing 1.3 gigawatts of Jalapeno in 2027, with the Jalapeno and second generation expected to exceed 5 gigawatts.
Tan said Broadcom aims to double AI revenue to $115 billion in fiscal year 2027, and plans to double it further to $230 billion in fiscal year 2028. He said the company is on track to achieve earnings of more than $30 per share. The LSEG consensus for adjusted earnings per share for fiscal year 2028 was $25.86.
“We are helping two of our most strategic customers, leading AI labs, bridge the gap between their current cash flow and the significant up-front investment required for their businesses,” said Amy Tunner, Broadcom’s finance director.
He said Broadcom may provide the institute with a residual value guarantee that would be a contingent liability.
“It makes economic sense for Broadcom to invest and enable these companies,” Tan said.
Semiconductor sales more than tripled to $16.7 billion, beating the average estimate of $15.2 billion, according to street accounts. Broadcom said revenue from infrastructure software was $8.75 billion, below the $8.82 billion consensus of analysts surveyed by Street Account.
WATCH: What to expect from Broadcom’s third quarter
