Broadcom Sales Rise as AI Developers Build More Products and Agents — Update

By Katherine Hamilton

Broadcom posted higher sales in the latest quarter as the type and number of AI customers kept expanding.

AI revenue in the quarter more than doubled to $8.4 billion, driven by demand for custom AI accelerators and networking, Chief Executive Hock Tan. Demand is now coming from both hyperscalers and regular companies that are looking to build out their own AI agents, he told investors on a call Wednesday.

"Some of them are hyperscalers, some of them are not hyperscalers, but they all have one thing in common, which is to create LLMS, productize it and generate platforms," Tan said.

The semiconductor and software maker's customer base is expanding beyond its core focus of hyperscalers like Google and Anthropic, Tan said. Customers now want help building out AI agents, code assistance platforms and consumer subscription platforms like OpenAI's ChatGPT.

Broadcom expects OpenAI to deploy its first generation of XPUs in 2027 with more than one gigawatt of compute capacity, Tan said. That will make the company Broadcom's sixth major hyperscaler customer, Tan said.

The company posted a first-quarter profit of $7.35 billion, or $1.50 a share, compared with $5.50 billion, or $1.14 a share, a year earlier.

Stripping out certain one-time items, adjusted per-share earnings were $2.05, ahead of the $2.03 anticipated by analysts, according to FactSet.

Revenue rose 29% to $19.31 billion. Analysts surveyed by FactSet forecast revenue of $19.26 billion.

The company also said its board authorized a new share buyback program of up to $10 billion.

Broadcom's big hyperscaler customers are starting to shift from training AI to deploying it for users. Tan said that transition has happened faster than expected, and he anticipates it will drive more demand for Broadcom's offerings.

"These five, six customers of ours are on the path to creating their own custom accelerators," he said. "I think we're going to see demand keep picking up."

In the current quarter, Broadcom expects revenue to be $22 billion, above analysts' projection of $20.5 billion.

Tan told analysts that AI networking is projected to grow to 40% of total AI revenue as Broadcom gains more share in that market.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

March 04, 2026 18:20 ET (23:20 GMT)