Broadcom said its focus on AI is central to its growth strategy, as reflected in its recent financial performance and future projections.
Below are the highlights of Broadcom’s AI focus:
AI Revenue Growth
AI-related revenue surged 220 percent year-over-year in FY2024, reaching $12.2 billion, representing 41 percent of total semiconductor revenue.
Broadcom said AI networking revenue, which represented 76 percent of networking, grew 158 percent, driven by doubling of AI XPU shipments to 3 hyperscale customers and 4 times growth in AI connectivity revenue driven by Tomahawk and Jericho shipments globally.
AI revenue is expected to grow by 65 percent year-over-year in Q1 FY2025 to $3.8 billion. The company projects the AI semiconductor business will significantly outpace the non-AI semiconductor segment in the coming years.
Hock Tan, President and CEO of Broadcom, said: “Semiconductor revenue was a record $30.1 billion driven by AI revenue of $12.2 billion. AI revenue which grew 220 percent was driven by our leading AI XPUs and Ethernet networking portfolio.”
Key AI Technologies
Broadcom’s custom AI accelerators (XPUs) are a cornerstone of its AI offerings. These are designed for high-performance computing and large-scale AI workloads.
Broadcom’s Ethernet networking solutions, including the Tomahawk and Jericho product lines, have driven AI connectivity revenue to fourfold growth in FY2024.
Broadcom has established multi-generational AI XPU roadmaps with three major hyperscale customers. These customers are expected to deploy over a million XPU clusters by 2027.
Two additional hyperscalers are in advanced development stages with Broadcom for their next-generation AI XPUs, potentially expanding the serviceable market.
Broadcom estimates the AI semiconductor Total Addressable Market (TAM) for XPUs and networking could reach $60 billion to $90 billion by fiscal 2027.
The company is shifting its semiconductor business segmentation to distinctly guide AI and non-AI revenues, underscoring the importance of AI to its future.
Broadcom is developing next-generation XPUs at the 3-nanometer process node, expected to be the first of their kind in the market, with volume shipments planned for the second half of FY2025.
Broadcom’s AI roadmap aligns with its hyperscale customers’ long-term AI development plans, ensuring sustained growth and market leadership.
Broadcom said it signed up over 4,500 of largest 10,000 customers for VMware Cloud Foundation (VCF). VCF enabled customers to deploy private cloud environments on prem as an alternative to running their applications in the public cloud.
