Broadcom CEO Hock Tan Forecasts AI Semiconductor Revenue to Exceed $100 Billion by 2027 Despite Stock Decline
On June 3, Broadcom (AVGO) CEO Hock Tan reiterated the company's guidance for over $100 billion in artificial intelligence semiconductor revenue by fiscal 2027. This forecast is supported by long-term contracts with major clients like Google parent Alphabet and OpenAI, as well as a growing backlog of AI chip orders. Despite these strong fundamentals, Broadcom’s stock has fallen about 25% from its 52-week high to around $370 per share. The drop reflects market skepticism or caution regarding the timing and concentration risks in achieving Tan's ambitious target. While revenue for fiscal Q2 2026 reached $10.8 billion, up sharply year-over-year, investors are now pricing future earnings at a lower multiple than previously seen. The key question ahead is whether the market will reassess its discounting of Broadcom’s AI growth potential when it reports results on September 2. The company's ability to deliver consistent revenue and maintain client commitments could influence investor sentiment.
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Topics: AI semiconductors Broadcom earnings long-term contracts