Broadcom has become the eighth U.S. tech company to surpass $1 trillion in market capitalization, with its stock surging 24% on Friday, its best day on record. The chipmaker’s market value exceeded $1 trillion for the first time, marking a significant milestone for the company.
In recent years, Broadcom has made several large acquisitions, including VMware for $61 billion and CA Technologies for $19 billion. The company has also expanded its business beyond semiconductors to include infrastructure software. Its artificial intelligence business has driven growth, with revenue increasing 150% in the latest quarter to $3.7 billion.
Broadcom’s custom AI accelerators, known as XPUs, are being used by top tech companies such as Meta, Alphabet, and TikTok parent ByteDance. The company’s CEO, Hock Tan, has stated that the outlook for AI looks bright, with XPUs expected to drive growth in the market.
The company’s move into infrastructure software has been successful, with revenue increasing 51% to $14.05 billion in the latest quarter. Broadcom expects infrastructure software revenue to increase 41% year-over-year in the current quarter, driven by growing demand for compute resources from large language models being created and deployed by top tech companies.
Broadcom’s market opportunity continues to grow due to the increasing demand for compute resources, with analysts forecasting a significant increase in growth for the company. With its custom AI accelerators and infrastructure software business, Broadcom is well-positioned to take advantage of this trend and drive further growth.
Source: https://www.cnbc.com/2024/12/14/broadcoms-long-path-to-the-trillion-dollar-club-and-trumps-role.html