Broadcom’s Custom Chip Empire Expands as Meta and Anthropic Lock In Long-Term Deals

Broadcom is cementing its position as the go-to architect for bespoke artificial intelligence hardware, securing multi-year commitments from two of the tech industry’s heaviest hitters. The chip designer’s stock touched a fresh all-time high of €357.70 on Thursday, extending a nine-session winning streak that has pushed its market value tantalizingly close to the $2 trillion threshold.

The rally reflects a fundamental shift in how the world’s largest technology companies are building their AI infrastructure. Rather than relying solely on off-the-shelf graphics processors, hyperscalers are increasingly commissioning custom silicon tailored to their specific workloads. Broadcom has positioned itself at the center of this transformation, supplying both chip architecture and advanced networking technology that allows massive server clusters to operate with minimal latency.

Meta Platforms has deepened its relationship with Broadcom through an expanded partnership running through 2029. The centerpiece of the deal is the development of the industry’s first 2-nanometer AI accelerators, built on Broadcom’s XPU platform. Meta intends to deploy these chips across its sprawling software ecosystem — including WhatsApp, Instagram and Threads — to power real-time AI features for billions of users. An iterative development process aims to bring new chip generations to market far faster than traditional industry timelines.

On the personnel front, Broadcom CEO Hock Tan is stepping down from Meta’s board of directors but will remain closely involved as an adviser focused exclusively on the social media giant’s internal chip strategy. The move underscores just how critical this partnership has become for both companies.

Anthropic, meanwhile, is locking in enormous compute capacity beginning in 2027 — 3.5 gigawatts of processing power, with Broadcom providing the underlying technology. Parallel development work is underway for OpenAI, giving Broadcom a diversified client base in the custom AI chip market that provides predictable revenue streams stretching years into the future.

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

The financial results already reflect this momentum. Broadcom’s most recent quarterly revenue surged nearly 30% to $19.3 billion, with earnings per share slightly exceeding analyst estimates. Over the past twelve months, AI-related revenue alone has climbed to roughly $20 billion.

Looking ahead, investors are focused on the June release of second-quarter results. Analysts project earnings per share of $2.24, up from $1.58 a year earlier, on revenue of approximately $22 billion. Benchmark analysts have reiterated their buy rating with a $485 price target, arguing that the company’s strategic positioning in custom silicon and networking gives it durable competitive advantages.

Technically, the stock is showing signs of being overheated. The relative strength index stands at 73.8, a level that typically precedes a short-term pullback. The share price has more than doubled over the past twelve months, rising roughly 129%, and trades well above its 50-day moving average of €290.75. A strong buy signal from April underpins the long-term uptrend, though profit-taking remains a near-term risk.

Some analysts see the fair value of Broadcom shares at $485, a target that could come into sharper focus if the company beats expectations in June. The sustained investment cycle among data center operators provides a supportive backdrop for that scenario, as the industry’s shift toward proprietary hardware shows no signs of slowing.