Alex Dudov
⬤ Citibank's 2026 semiconductor outlook shows Broadcom's (AVGO) AI revenue could grow dramatically as major tech companies move toward custom AI chips. The bank estimates Broadcom's AI revenue at $20.2 billion in 2025, jumping to $50.5 billion in 2026, then nearly doubling to $100 billion in 2027. This growth would push AI from 32% of Broadcom's total sales in 2025 to 53% in 2026 and 68% in 2027, showing a major shift toward application-specific integrated circuits built for large-scale AI operations.
⬤ Broadcom's AI chip business is expanding beyond its current focus on Google's TPU programs to include more big AI players. Total ASIC revenue is projected to climb from $14.5 billion in FY25 to $50.5 billion in FY26 and $100 billion in FY27. While Google stays the biggest customer with projected revenue of $25.8 billion in 2026 and $50.1 billion in 2027, other major deployments are coming. Anthropic is expected to contribute $20.9 billion in 2026 and $4.4 billion in 2027, OpenAI $20.2 billion in 2027, xAI $8.0 billion in 2027, and AWS/Microsoft $10.6 billion in 2027. Meta and ByteDance are also expected to increase their ASIC spending through 2027.
⬤ Multiple custom ASIC programs currently in testing or early rollout could move into full production over the next two years. Broadcom operates in a specialized market where only a handful of chip suppliers can design, build, and scale custom accelerators along with the networking systems they need. The 2027 timeline suggests many of these projects could hit mass production simultaneously, significantly boosting Broadcom's AI revenue.
⬤ The projections highlight how major cloud providers are increasingly building their own AI chips designed for specific tasks. As spending shifts toward internal AI infrastructure, growing ASIC adoption could change the competitive landscape across the semiconductor industry, with Broadcom positioned as a key winner in the move toward customized, high-volume AI hardware.
Alex Dudov
