Broadcom Locks in Google, Meta, and Anthropic as AI Chip Demand Surges Past $8 Billion

The race to build bespoke artificial intelligence hardware is reshaping the semiconductor landscape, and Broadcom has emerged as the chief architect for some of the world’s largest technology companies. In a flurry of strategic announcements, the chipmaker has extended partnerships with Google through 2031 and Meta Platforms through 2029, while also onboarding AI startup Anthropic as a major client from 2027. The deals underscore a fundamental shift away from off-the-shelf graphics processors toward custom silicon designed for hyperscale computing.

Broadcom’s first-quarter results for fiscal 2026 provided the financial firepower behind these ambitions. Revenue hit $19.31 billion, a near-30 percent jump year-over-year, with the semiconductor segment climbing 52 percent to $12.52 billion. The standout performer was the AI chip division, which generated $8.4 billion in revenue — more than double the prior-year period. Earnings per share of $2.05 edged past analyst expectations, reinforcing investor confidence in the company’s execution.

The Google agreement, which extends a decade-long collaboration, centers on the next generation of Tensor Processing Units. Broadcom handles integration, supply chain management, and manufacturing oversight while Google designs the core architecture. The eighth-generation TPU family — the TPU 8t for training and TPU 8i for inference — is slated for Google Cloud customers later this year. The contract also includes networking components for Google’s upcoming AI rack systems.

Meta’s renewed partnership pushes the relationship to 2029 and focuses on developing what Broadcom claims will be the industry’s first 2-nanometer AI accelerators. Built on the XPU platform, the chips will be paired with advanced Ethernet technologies to connect massive server clusters with minimal latency. Meta plans to deploy real-time AI features across its ecosystem of WhatsApp, Instagram, and Threads, requiring enormous computational throughput.

The Anthropic deal adds a third pillar to Broadcom’s custom-chip strategy. Starting in 2027, the AI startup will gain access to approximately 3.5 gigawatts of TPU-based computing capacity through Broadcom’s infrastructure. Anthropic’s annualized revenue has reportedly surpassed $30 billion, reflecting its rapid growth trajectory.

Should investors sell immediately? Or is it worth buying Broadcom?

Management’s outlook remains bullish. For the current second quarter, Broadcom expects revenue of roughly $22 billion. CEO Hock Tan projects cumulative AI chip revenue will exceed $100 billion by 2027, a target that appears increasingly attainable given the pipeline of long-term contracts.

The stock has responded accordingly, hitting a 52-week high of around 363 euros — a gain of more than 130 percent from its low a year ago. Technical indicators suggest the rally may have room to run, with analysts at Benchmark reiterating a buy rating and a price target of $485. The Philadelphia Semiconductor Index’s 16-day winning streak has provided additional tailwinds.

However, the valuation is not without risks. The relative strength index sits at 73.8, signaling overbought conditions. Customer concentration remains a concern, and ongoing US-China trade tensions could disrupt growth if geopolitical headwinds intensify. Support for the stock is seen near $415.

In a notable personnel shift, Hock Tan will step down from Meta’s board of directors but transition into an advisory role focused exclusively on the social media giant’s internal chip strategy. The move underscores the deepening technical integration between the two companies as Broadcom positions itself at the center of the AI infrastructure buildout.