Broadcom Enters the Prestigious $1 Trillion Market Cap Club Amidst AI Surge
In a historic achievement in mid-December 2024, semiconductor titan Broadcom joined the exclusive club of U.S. technology companies with a market capitalization surpassing $1 trillion. This milestone was marked by a record-breaking 24% surge in the company’s stock on December 13, 2024, following the announcement of robust fourth-quarter earnings and an optimistic outlook on artificial intelligence (AI) revenue.
Broadcom’s revenue for the fourth quarter stood at a staggering $14.05 billion, representing a 51% increase year over year. Even more impressive was the company’s AI revenue, which skyrocketed by 220% to reach $12.2 billion for the fiscal year 2024. CEO Hock Tan projected a potential market worth of $60 to $90 billion for customized AI accelerators by fiscal year 2027, signifying a four-fold increase from current levels.
Positioning itself as a crucial supplier of custom AI chips, Broadcom has secured partnerships with major cloud computing companies such as Meta, Alphabet, and ByteDance. Tan revealed that Broadcom is in the process of developing custom AI chips for three major technology companies, with an expectation of each deploying 1 million AI chips by 2027.
This accomplishment cements Broadcom’s place alongside tech behemoths like Microsoft, Amazon, and Nvidia in the trillion-dollar club, further solidifying its position as a formidable player in the AI chip market.
Source: CNBC