Key Takeaways
- GF Securities upgraded Broadcom (AVGO) with a new $450 price target following increased Google TPU shipment projections
- Revised TPU shipment forecasts show 4.5M units expected in 2026 and 7.9M in 2027, a significant increase from prior 6M estimate
- Broadcom’s Ironwood and Sunfish chipsets currently lead the market as the only products in customer testing phase
- CEO Hock Tan revealed visibility into exceeding $100B in AI-related revenue by 2027
- Wall Street analysts contend the $100B projection may be significantly understated, with calculations suggesting $180B–$200B potential
Broadcom (AVGO) shares were changing hands at $320.55, gaining 0.71%, during Wednesday’s morning session.
The semiconductor giant is capturing renewed investor interest following an analyst upgrade from GF Securities, coupled with growing Wall Street speculation that the company’s ambitious $100B AI revenue projection for 2027 might actually be too conservative.
GF Securities equity analyst Alicia Xia elevated her price objective on Broadcom shares to $450 from a previous level, maintaining her Buy recommendation. The upward revision follows her decision to increase shipment forecasts for Google’s Tensor Processing Units (TPUs).
Xia’s updated model anticipates total TPU volume reaching 4.5M units throughout 2026, followed by 7.9M units in 2027. The 2027 projection represents a substantial upgrade from her previous 6M unit estimate, primarily fueled by anticipated expansion in external sales channels.
Projections specific to Broadcom’s TPU production stand at 4.1M units for 2026 and 5.8M for 2027. The company’s Ironwood and Sunfish chip architectures currently maintain exclusivity as the only designs available for customer validation testing. MediaTek’s competing Zebrafish processor has yet to enter the testing phase, providing Broadcom with a meaningful competitive advantage.
Xia’s analysis also anticipates continued price appreciation, with Broadcom’s forthcoming Pumafish chip potentially commanding prices exceeding $20,000 in 2027, attributed to its enhanced architectural complexity.
Debating the $100B Revenue Threshold
The more compelling narrative emerging from recent developments centers on whether Broadcom’s internal AI revenue projections significantly underestimate actual potential.
During the company’s March 4 quarterly earnings conference call, CEO Hock Tan stated that Broadcom maintains clear “line of sight” toward surpassing $100B in AI-generated revenue by 2027. While that figure alone appears substantial, several analysts on the call challenged the estimate — not by questioning its achievability, but by suggesting it’s too conservative.
Bernstein research analyst Stacy Rasgon attempted to establish more precise calculations using gigawatt capacity — a metric measuring data center power infrastructure — as his baseline unit. His analysis tallied Broadcom’s confirmed customer commitments: 3 GW allocated to Anthropic, 1 GW designated for OpenAI, a minimum 2 GW commitment from Meta, and at least 3 GW contracted with Google. His comprehensive assessment points toward approximately 9–10 GW for the 2027 timeframe.
Tan validated Rasgon’s methodology, acknowledging that Broadcom’s projections show capacity “getting close to 10 gigawatts” by 2027.
Rasgon subsequently applied his revenue-per-gigawatt calculation of approximately $20B. Bank of America analyst Vivek Arya corroborated this framework, referencing Broadcom’s 2026 Anthropic infrastructure buildout — where 1 GW of capacity is projected to generate $20B in revenue.
Using the $20B per-gigawatt metric across 10 GW of capacity, the mathematics produce a range between $180B and $200B — substantially exceeding the company’s official guidance.
Tan offered measured validation without strongly objecting. He acknowledged that per-gigawatt revenue varies depending on customer specifications, but conceded the calculations are “not far off” from reality.
Strategic Supply Agreements Extend Through 2028
Broadcom has strategically secured long-term supply commitments for advanced-node wafers, high-bandwidth memory modules, specialized substrates, and T-glass components extending through 2028 — reaching one year beyond the company’s current forecasting window.
Melius Research analyst Ben Reitzes highlighted that Broadcom appears to be the first major player to secure these critical components with such extended timelines.
The current Wall Street consensus price target for AVGO stands at $435.30, suggesting approximately 36% upside potential from present trading levels, based on aggregated ratings from 33 covering analysts.
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