Broadcom Inc (NASDAQ:AVGO, ETR:1YD) shares jumped 13% in after-hours trading after the company reassured investors about strong demand for AI chips and delivered a better-than-expected second-quarter forecast.
The semiconductor giant expects revenue of about $14.9 billion for the quarter, ahead of Wall Street’s $14.76 billion estimate.
Investors had been rattled by Marvell Technology’s weaker outlook a day earlier, but Broadcom’s forecast helped restore confidence in the AI chip market.
CEO Hock Tan said Broadcom expects $4.4 billion in second-quarter revenue from its AI semiconductors, as major cloud computing companies invest in custom chips for their data centres.
The company has also gained four new hyperscale customers looking to develop their own AI processors, separate from the three existing ones.
First-quarter revenue rose to $14.92 billion, beating expectations of $14.61 billion.
AI-related revenue surged 77% to $4.1 billion, while infrastructure software sales climbed 47% to $6.7 billion, surpassing analyst estimates.