Overview
- UBS lifted its Broadcom target to $490 after the Anthropic arrangement moved from full racks to custom ASICs, a change the bank says trims headline revenue but lifts margins.
- Bloomberg reporting says Broadcom is in discussions with Blackstone and Apollo on roughly $35 billion in private credit to fund AI chip work, though the companies have not confirmed a deal.
- Other banks raised targets in recent days, with Wells Fargo, Citi, and TD Cowen citing stronger AI demand and improving earnings visibility.
- Broadcom guided AI semiconductor revenue of $10.7 billion for Q2 and previously posted Q1 revenue of $19.311 billion with $8.4 billion from AI and $8.01 billion in free cash flow, alongside a new $10 billion buyback.
- Broadcom is a leading supplier of custom AI chips known as ASICs that large cloud providers use to run their own models, a niche that helps explain its $2 trillion market value and rising investor confidence.