The semiconductor giant has crossed a threshold only five other US companies have ever reached. Broadcom’s market capitalisation surged past $2 trillion on Wednesday, propelled by a deepening partnership with Google and an expanding roster of AI clients that now includes Anthropic and OpenAI.
A New High on the Back of Google’s Latest TPU
Shares hit an all-time closing high of $422.65 on April 22, after Google unveiled the eighth generation of its Tensor Processing Units — chips co-developed with Broadcom. The stock gained roughly 5% on the day, and in European trading the ADR equivalent touched €361.00, another 52-week peak. The rally extended a winning streak to nine consecutive sessions, with the price more than doubling over the past twelve months.
The product launch came with a significant commitment: Broadcom’s long-term agreement to design custom TPUs and supply networking components now runs through 2031. That gives the company years of predictable, high-margin revenue from its semiconductor division.
Custom Chips for the AI Giants
Beyond Google, Broadcom is carving out a dominant position in bespoke AI accelerators. Anthropic will tap into 3.5 gigawatts of computing capacity from 2027 onward, with Broadcom providing the underlying chip technology. Parallel development work is also underway for OpenAI. These multi-year contracts with hyperscalers and AI labs are transforming Broadcom into the go-to supplier for specialised AI hardware — a role that UBS believes will generate around $145.4 billion in AI-related revenue by fiscal 2027.
Institutional investors have taken note. They now hold more than three-quarters of all outstanding shares, providing a sturdy base for the rally.
Should investors sell immediately? Or is it worth buying Broadcom?
Technicals Flash a Warning
The stock’s blistering run has pushed its Relative Strength Index to 73.8, a level that typically signals overbought conditions. While the price sits well above its 50-day moving average of €290.75 — a strong bullish signal from April — the elevated RSI suggests a short-term pullback or consolidation could be on the cards. Profit-taking remains a tangible risk.
Debt and Insider Sales Raise Eyebrows
Not everything is rosy. Broadcom carries $66 billion in debt, a legacy of its VMware acquisition. Insiders sold roughly 324,000 shares worth about $106 million in the past quarter. While such sales are routine for executives, the scale has drawn attention.
At the annual meeting on April 20, shareholders re-elected eight directors, including CEO Hock Tan and Chairman Henry Samueli. PricewaterhouseCoopers was confirmed as auditor for the current fiscal year. The only notable dissent came against director Harry L. You, who faced roughly 955 million votes against him — an outlier in an otherwise smooth vote.
Software as a Second Engine
Broadcom is not relying solely on hardware. In mid-April, it launched the VMware Tanzu Platform Agent Foundations, a secure runtime environment for autonomous AI applications. The move is part of a broader strategy to pair its data-centre hardware dominance with a growing software portfolio, creating a more diversified revenue base.
What to Watch in June
All eyes are now on the second-quarter earnings report, due in June. Analysts expect earnings per share of $2.24, up from $1.58 a year ago, on revenue of roughly $22 billion. If Broadcom beats those estimates, the door opens for further upward revisions to price targets — some analysts already see fair value at $485. The market will be watching closely to see whether the AI revenue momentum can keep pace with the expectations UBS has already baked in.
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