By Joel South
Publication Date: 2026-04-07 15:56:00
Broadcom (NASDAQ:AVGO) rose 3.65% in a.m. trading on Tuesday after announcing a long-term agreement with Alphabet (NASDAQ:GOOGL) to design and supply custom Tensor Processing Units (TPUs) and networking components for Google’s AI racks through 2031.
The deal also pulls in Anthropic, granting the AI startup access to approximately 3.5 gigawatts of next-generation TPU-based AI compute starting in 2027. The multi-year structure extends revenue visibility well beyond typical semiconductor cycles, making it more significant than the headline number alone suggests.
Tensor Processing Units are custom-designed chips built for the matrix math powering AI model training and inference. Unlike Nvidia’s general-purpose GPUs, TPUs are architected around a single customer’s workload, delivering better performance per watt at scale. As CEO Hock Tan noted on the Q4 FY2025 earnings call, “you can put in hardware what if you use a general-purpose GPU you can only do in software and…
