Broadcom (AVGO)
Custom AI ASICs + networking chips (Memory/Jericho). DC networking backbone.
- Ticker: AVGO
- Sector: semiconductor (networking asic)
Broadcom (AVGO) is a tracked supply-chain name in the data-center buildout in the semiconductor sector. Data Center Index tracks Broadcom's capex history, project wins, and supplier exposure across the AI infrastructure buildout, refreshed daily from SEC filings and project announcements.
Broadcom data center thesis
Broadcom is the custom-ASIC vendor of record for the hyperscalers that want to escape NVIDIA pricing: Google TPU, Meta MTIA, and ByteDance accelerators all run through Broadcom design teams. FY25 revenue hit $63.9B with $25.5B operating income and 68% gross margin, and Q1 FY26 backlog jumped to $45B, up 101% YoY, signaling the ASIC + Tomahawk/Jericho networking pipeline is fully booked.
Bull case
- Backlog inflection is the cleanest signal in the group: $45B at Q1 FY26 is +101% YoY, and that book is dominated by multi-year ASIC programs that convert to revenue across 2026-28 with high visibility.
- Tomahawk/Jericho switches are the networking backbone of every NVIDIA cluster Broadcom does not design the GPU for; the company is paid on AI capex regardless of which accelerator wins the socket.
- 68% gross margin on a $64B revenue base is the supply-chain spread that funds the dividend, the buyback, and the next round of ASIC R&D, a defensible flywheel as long as hyperscaler in-sourcing keeps preferring ASIC partners over fully internal teams.
Bear case
- Hyperscaler in-sourcing risk cuts both ways: if Google or Meta moves the next ASIC generation fully in-house (or to TSMC direct), Broadcoms design-services revenue per program decelerates faster than the headline backlog suggests.
- Customer concentration: the AI ASIC line depends on 3-4 hyperscaler programs; any program slip or re-spin compresses both the revenue line and the multiple.
- Up 108% in 12 months on a $63B revenue base; a single missed AI ASIC quarter or a software-from-VMware miss collapses the multiple from peak-cycle expectations.
Broadcom revenue and capex
In fiscal 2025, Broadcom reported revenue of $63.9B, capital spending of $623.0M and operating income of $25.5B.
| Fiscal year | Revenue | Capex | Operating income |
|---|---|---|---|
| 2025 | $63.9B | $623.0M | $25.5B |
| 2024 | $51.6B | $548.0M | $13.5B |
| 2023 | $35.8B | $452.0M | $16.2B |
Tracked Broadcom data center projects
- Meta Hyperion, 5 GW, Holly Ridge, LA · under construction
- AWS Project Rainier (New Carlisle), 2.2 GW est., New Carlisle, IN · operational
- OpenAI Stargate Abilene, 1.2 GW, Abilene, TX · operational
- Meta Prometheus, 1 GW, New Albany, OH · operational
- Google New Albany, 250 MW, New Albany, OH · operational
- Google Omaha, 237 MW est., Omaha, NE · operational
Analysis mentioning Broadcom
- Anthropic IPO Odds After a $16.8 Billion Quarter: November Holds, $2 Trillion Doesn't, 2026-10-15
- Meta Muse Runs a Separate Computer for Every User, and 642,000 of Them Showed Up in 12 Days, 2026-09-23
- Why Data Centers Are So Big: A Gigawatt Campus Costs $38 Billion, and the Land Is Under 1% of It, 2026-09-17
- Anthropic's $517 Billion in Compute Commitments: Amazon Books $100 Billion, and Google's Share Goes to Apollo, 2026-09-10
- OpenAI’s $1.15 Trillion Compute Bill: Who Actually Holds the Bag, 2026-09-08
Recent Broadcom news
- Celestica debuts liquid-cooled CPO switch for AI fabrics, DCD, 2026-10-15
- Oracle, Broadcom, and SpaceX looking to secure ten of billions in financing to support AI compute purchases – report, DCD, 2026-10-08
- Broadcom slams AI silicon-fueled Q3, promises double-double on the way, DCD, 2026-09-04
- OpenAI and Broadcom in discussions over financing of $18bn custom chip project – report, DCD, 2026-05-08
- Meta Expands Broadcom Partnership to Co-Develop Custom AI Silicon, Data Center Knowledge, 2026-04-15