Broadcom AI revenue surges in fiscal first quarter

Broadcom reported better-than-expected fiscal first quarter results due to strong demand for AI semiconductors.

The company reported first quarter net income of $7.35 billion, or $1.50 a share, on revenue of $19.31 billion, up 29% from a year ago. Non-GAAP earnings were $2.05 a share to top estimates by 3 cents a share.

In a statement, CEO Hock Tan said first quarter AI revenue was $8.4 billion, up 106% from a year ago. Demand was driven by custom AI accelerators and AI networking.

"Our AI revenue growth is accelerating, and we expect AI semiconductor revenue to be $10.7 billion in Q2," said Tan.

Semiconductor revenue in the quarter was $12.51 billion, or 65% of revenue. The infrastructure software unit, led by VMware, had revenue of $6.8 billion, up 1% from a year ago.

In the first quarter a year ago, Broadcom's chip division accounted for 55% of revenue.

As for the outlook, Broadcom projected second quarter revenue of about $22 billion with adjusted EBITDA about 68% of projected revenue.

On a conference call, Tan said:

• "The ramp of custom AI accelerators across all our 5 customers is progressing very well. For Google, we continue our trajectory of growth in '26 with strong demand for the seventh-generation Ironwood TPU. In 2027 and beyond, we expect to see even stronger demand from next generations of TPU. For Anthropic, we are off to a very good start in 2026 for 1 gigawatt of TPU compute. And for '27, this demand is expected to surge in excess of 3 gigawatts of compute. Our XPU franchise, I should add, extends beyond TPUs."
• "Meta's custom accelerator MTIA road map is alive and well. We're shipping now. And in fact, for the next-generation XPUs, we will scale to multiple gigawatts in '27 and beyond. Rounding off for customers 4 and 5, we see strong shipments this year and which we expect to more than double in 2027. We also now have a sixth customer. We expect OpenAI deploying in volume their first-generation XPU in 2027 at over 1 gigawatt of compute capacity. Let me take a second to emphasize our collaboration with these 6 customers to develop AI XPUs is deep, strategic and multiyear."
• "VMware revenue grew 13% year-on-year. Bookings continue to be strong and total contract value booked in Q1 exceeded $9.2 billion, sustaining an ARR, which is annual recurring revenue growth of 19% year-upon-year. We are confident that the growth in generative and agentic AI will create the need for more VMware, not less."