Broadcom Projects AI Semiconductor Revenue to Reach $230 Billion by 2028

Broadcom has announced an ambitious forecast for its AI semiconductor revenue, predicting it will reach approximately $230 billion by fiscal 2028. This projection represents a significant increase from the expected $58 billion in revenue for the current fiscal year. CEO Hock Tan shared these insights during the company's fiscal Q3 2026 earnings call, highlighting that AI has become a central focus for Broadcom rather than a secondary venture.

In its latest quarterly results, Broadcom reported total revenue of $29.6 billion, marking an 86% year-over-year increase. The AI semiconductor division alone generated $16.7 billion in Q3, a remarkable 221% surge compared to the same quarter last year. For Q4, the company anticipates AI semiconductor revenue to reach $21.7 billion, contributing to an overall fiscal year total of approximately $58 billion in AI chip sales.

Tan indicated that AI semiconductor revenue is expected to double to $115 billion in fiscal 2027 and double again to around $230 billion in fiscal 2028. Custom chips are driving this growth, accounting for about 73% of Q3 AI revenue, with major commitments from customers such as Google, OpenAI, Anthropic, and Meta. Broadcom has secured supplies of advanced wafers and memory through 2028 to support this demand.

Despite the strong performance in the AI sector, Broadcom's overall Q3 revenue slightly fell short of analyst expectations, leading to a dip in stock prices. While Tan's forecast of $230 billion for 2028 is optimistic, some analysts estimate the figure could be closer to $200 billion. The broader AI semiconductor market is projected by RBC to exceed $550 billion by 2028, suggesting that Broadcom's target could represent around 40% of the total market.

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Source: KLEA News