Broadcom stocks soared 15% on Friday later the chipmaker mentioned on its profits name that it had connect a pristine $10 billion buyer. Analysts temporarily pointed to OpenAI.
Following a better-than-expected profits file past due Thursday, Broadcom CEO Hock Tan advised analysts {that a} fourth immense buyer had installed orders for $10 billion in customized synthetic judgement chips, which the corporate screams XPUs.
“One of these prospects released production orders to Broadcom, and we have accordingly characterized them as a qualified customer for XPUs,” Tan mentioned. He added that the form greater Broadcom’s forecast for AI earnings upcoming week, when shipments will start.
Analysts at Mizuho, Cantor Fitzgerald and KeyBanc all mentioned they believe AI startup OpenAI is the buyer. The Financial Times reported on Thursday, mentioning public habitual with the partnership, that the 2 corporations co-designed a chip that may crash the marketplace upcoming week.
OpenAI declined to remark at the file.
Age Broadcom doesn’t title its immense web-scale shoppers, analysts have mentioned relationship again to utmost week that its first 3 shoppers have been Google, Meta and TikTok mother or father ByteDance.
“During the call, the company surprised us by noting that it had secured a $10B order from a fourth XPU customer (we believe this is OpenAI), adding significant upside to the company’s three current XPU customers (Google, Meta, and ByteDance),” analysts at Cantor wrote in a observe past due Thursday. “Shipments are expected to commence in 2026.”
Broadcom’s retain has been on a tear of past due as the corporate has joined Nvidia on the entrance of the race to manufacture the sorts of processors and infrastructures wanted for immense AI workloads. The retain is up about 130% within the year week, lifting Broadcom’s marketplace cap year $1.6 trillion.
For the fiscal 3rd quarter, Broadcom reported profits and earnings that crowned estimates. The corporate mentioned it expects $17.4 billion in fourth-quarter earnings, upper than the $17.02 billion anticipated by way of Wall Side road analysts, with AI earnings attaining $6.2 billion.
However information of an incoming $10 billion buyer is what were given Wall Side road excited.
Tan mentioned at the name that “immediate and fairly substantial demand” boosts the outlook for upcoming week, “and really changes our thinking of what 2026 would be starting to look like.”
The corporate didn’t grant particular steering for upcoming week, however Tan urged that enlargement in its AI might be above the 50% to 60% field he’d introduced within the prior name.
Analysts at Mizuho raised their AI earnings enlargement estimate for upcoming week to 76% up from about 60%, which might carry the overall to $35 billion. General earnings for the week finishing in October 2026 is anticipated to extend about 30% to $81.8 billion from $63.1 billion this fiscal week, in step with analysts surveyed by way of LSEG.
Along with {hardware}, Broadcom has a immense instrument industry, keyed by way of its $61 billion acquisition of server virtualization instrument dealer VMware in 2023. Earnings within the infrastructure instrument industry, which contains VMWare, rose 43% to $6.79 billion.
