Shares in semiconductor developer Broadcom AVGO are up on Tuesday after the firm inked new AI chip deals with Alphabet (GOOGL) and Anthropic. The deals run through 2031 and center on tensor processing units (TPUs). Broadcom will help develop these TPUs for Google’s AI data centers as part of that respective deal. In addition to that, Anthropic will also get access to 3.5 gigawatts of computing capacity from Google’s AI chips starting in 2027.
While Broadcom (AVGO) shares are still down 6.8% in 2026, many experts on Wall Street forecast a bright future for the semiconductor developer. Renewed AI pessimism has dragged AVGO and other AI stocks lower in the last two months. However, it remains a healthy competitor to AI chipmaker Nvidia (NVDA), and was one of the hottest stocks last year as the AI wave roared on.
In addition to AVGO, Alphabet (GOOGL) stock is also higher to open the week. The Google developer is up just a fraction of a percent on Tuesday, but up over 7% in the last five days. The latest I chip deal with Broadcom highlights Alphabet’s strategic positioning for future growth, capitalizing on the continued demand for AI technology and development. Anthropic plays a leading role in that, as it has quickly become one of the more prominent AI companies in the US.
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Furthermore, the company recently posted strong quarterly results yet again and highlighted just how massive its growth opportunities still are. Its first-quarter fiscal 2026 earnings were strong, with the company’s revenue totaling $19.3 billion for the period ending Feb. 1, which was an increase of 29% from the same period a year ago. Its net income of $7.3 billion rose at an even faster rate of 34%.
The growth of AVGO is expected to surge even faster in the coming years, according to several forecasts. EPS is expected to grow 66% in FY 2026, followed by 57% growth in FY 2027. Additionally, CEO Hock Tan says the company’s AI chip revenue will exceed $100 billion in 2027. The continued boom in revenue would be a direct spark for AVGO shares to continue their rally. Combined with successful partnerships with companies like Alphabet and revenue expected to grow at a similar clip, AVGO is a promising stock investment at its current price.