Broadcom Poised to Benefit From AI-Driven Sales in Fiscal Q1, Oppenheimer Says

MT Newswires Live02-27 04:14

Broadcom (AVGO) is expected to benefit from accelerating AI-related sales in fiscal Q1, driven by hyperscalers and cloud service providers developing large frontier Large Language Models, Oppenheimer said.

The brokerage said in a Wednesday note that it expects AI-related sales to rise about 30% quarter over quarter in Q1, accelerating from 25% in fiscal Q4 and 17% in fiscal Q3. This could provide upside to fiscal Q1 street estimates of $19.2 billion in sales and $2.02 in earnings per share.

The investment firm said that Broadcom's dominant custom Application-Specific Integrated Circuit, or ASIC, and networking franchises underpin a growing backlog of more than $162 billion. Of that, roughly $73 billion is related to AI orders.

The brokerage noted that Broadcom's secular growth is supported by data center AI infrastructure, networking and expanding TPU workloads. The investment firm said the factors are expected to drive steady cash flow for the company.

Oppenheimer reiterated its outperform rating and $450 price target on the stock.

Shares of Broadcom were down 4.6% in recent Thursday trading.

Price: 316.93, Change: -15.38, Percent Change: -4.63

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