Broadcom Sees AI-Chip Revenue Reaching $230 Billion by Fiscal 2028

Broadcom’s latest results made the scale of its AI infrastructure business clearer: the company reported $16.7 billion in third-quarter AI-chip sales and lifted its fiscal 2027 AI-chip revenue target to about $115 billion. It then projected a further doubling to roughly $230 billion in fiscal 2028. 1

The numbers point to strong demand for custom AI accelerators and the networking equipment needed to connect large computing clusters. But investors focused on a near-term complication: Broadcom’s fiscal fourth-quarter revenue forecast was slightly below Wall Street’s consensus estimate. 1

The headline numbers

Broadcom reported fiscal third-quarter revenue of $29.59 billion, ahead of the $29.36 billion consensus estimate. Adjusted earnings per share were $3.32, above the $3.24 expected by analysts. 1

AI-chip sales were the central driver, more than tripling from a year earlier to $16.7 billion. 1

For the fiscal fourth quarter, Broadcom forecast total revenue of about $34.8 billion, compared with an analyst consensus of $35.03 billion. That small gap helped temper the immediate market response to the much larger multiyear AI forecast. 1

A sharply higher AI revenue path

Broadcom had previously forecast more than $100 billion of AI-chip revenue for fiscal 2027. It raised that figure to approximately $115 billion and said it expects about $230 billion in fiscal 2028. 1

Those are forecasts, not booked revenue, and reaching them depends on customers continuing to build AI infrastructure at an exceptional pace. Still, Broadcom said quarterly AI-chip bookings exceeded $30 billion and that it had secured sufficient supply for the higher fiscal 2027 target. 1

Management also described committed infrastructure deployments extending into 2028, including more than 10 gigawatts for Anthropic, more than 5 GW for OpenAI, and 3 GW for Meta. 1

Why Broadcom is benefiting from AI spending

Broadcom’s AI position differs from the market for general-purpose GPUs. It provides custom AI accelerators designed for specific large customers, including Meta, Google and OpenAI, as well as high-speed networking products used to link large AI computing systems. 1

That matters because AI capital spending is not confined to a single processor architecture. As large technology companies build increasingly specialized clusters, custom chips and networking can become major parts of the infrastructure bill. Broadcom’s results are evidence that this broader AI hardware market is growing alongside demand for Nvidia’s GPU-based systems. 1

What could limit the upside

The forecast rests on continued heavy investment by hyperscalers and leading AI developers. Investors remain concerned about whether those enormous infrastructure budgets will ultimately generate adequate returns, a question that can affect sentiment even when semiconductor demand is strong. 1

Competition is another consideration. Broadcom faces rivals in custom AI chips, including Marvell, whose Google custom-chip work has added to competitive pressure. 1

Broadcom’s share price had also lagged some peers and the broader semiconductor index in 2026 before the results, while the stock fell more than 1% after hours following the report. 1

Bottom line

Broadcom delivered a substantial upgrade to its AI outlook: $115 billion of AI-chip revenue in fiscal 2027 and roughly $230 billion in fiscal 2028. Its third-quarter revenue and earnings exceeded estimates, supported by $16.7 billion of AI-chip sales. 1

The key question is no longer whether AI demand is material to Broadcom—it plainly is. The harder question is whether customers can sustain the deployment and spending levels implied by the company’s 2027 and 2028 targets, particularly as custom-chip competition intensifies and investors demand proof of returns on AI infrastructure spending. 1