Broadcom Edges Higher as AI Chips Target $21.7 Billion

This article first appeared on GuruFocus.

Broadcom (NASDAQ:AVGO), the custom-chip and infrastructure-software powerhouse, projected $21.7 billion in fiscal fourth-quarter AI semiconductor revenue as hyperscaler spending keeps pushing its chip business higher. Shares gained approximately 0.2% to $358.13. The valuation picture adds another angle: Broadcom’s share price sits 12.42% below its $408.91 GF Value, suggesting the stock remains below GuruFocus’ estimate of fair value despite its powerful AI run.

AI semiconductor revenue surged 221% to $16.7 billion in the third quarter, accounting for roughly 56.4% of Broadcom’s $29.59 billion in total sales. Management now expects companywide fourth-quarter revenue of approximately $34.8 billion alongside a 66% non-GAAP operating margin. That combination matters. Broadcom is not simply selling more AI…