Broadcom (AVGO) may be in talks with Microsoft (MSFT)-backed OpenAI to develop new AI chips, according to an exclusive report. information. According to the report, OpenAI, known for developing ChatGPT, is working with Broadcom on the idea as part of broader discussions with various chip designers. Additionally, OpenAI has hired ex-Google (GOOGL) employees who previously worked on the Tensor processor to support the effort.
Broadcom – A Key Player in AI
Nvidia (NVDA) currently leads the AI race, but Broadcom is quickly closing the gap and expects AI revenue to exceed $11 billion in fiscal year 24. Broadcom reported revenue of $12.5 billion in the second quarter, up 12% year over year on an organic basis. This growth was primarily driven by AI revenue, which increased 280% year over year to $3.1 billion.
According to TipRanks’ “Bulls Say, Bears Say,” analysts who are bullish on AVGO expect the company’s AI strategy to be focused on “customers of major consumer AI platforms such as Google, Meta, and ByteDance, who are expected to continue investing heavily in the future.”
meanwhile, Bloomberg Earlier this year, it was reported that OpenAI CEO Sam Altman was seeking to raise billions of dollars from investors to build a network of semiconductor factories.
Is AVGO a good stock to buy now?
Analysts maintain a bullish view on AVGO shares, giving them a strong buy consensus rating based on 23 buys and 1 hold. Over the past year, AVGO has surged over 80%, and AVGO’s average target price of $196.36 suggests a potential upside of 22.3% from current levels.
