After Broadcom, which supplies chips to Apple and other large Technology companies, expects a significant increase in demand for its AI chips, its stock price soared, and its Market Cap exceeded $1 trillion for the first time.

In the earnings report conference call, the company stated that sales of AI products in the first fiscal quarter would increase by 65%, far above the overall growth rate of about 10% for its Semiconductors. The chip manufacturer also predicts that by fiscal year 2027, the potential market space for its AI components designed for Datacenter operators could reach $90 billion.

Similar to NVIDIA, Broadcom also positions itself as a major beneficiary of the AI spending surge. The company's CEO, Hock Tan, stated that the company has gained two new hyperscale customers—large Datacenter operators.

After the New York market opened on Friday, the stock once rose by 21%, marking the largest increase since March 2020, closing at $218.29.

Investor optimism for AI has prompted a buying spree for Broadcom stocks this year. This company, based in Palo Alto, California, once predicted it would gain over $10 billion in annual revenue from this market, surpassing other sectors. Ultimately, this figure reached $12.2 billion in the previous fiscal year.

Hock Tan stated that AI revenue grew by 220% this year, driven by demand for processors and network components. Meanwhile, demand for non-AI chips is expected to decline in the first fiscal quarter. Broadcom expects total sales to reach $14.6 billion for the first fiscal quarter ending in January, in line with Analyst expectations.

Broadcom expects strong demand for its AI chips, with AI product sales in the first fiscal quarter projected to grow by 65%. Tom Mackenzie reports.

The company announced that for the fourth quarter ending November 3, the EPS, excluding certain items, was $1.42. Revenue rose to nearly $14.1 billion. Data compiled by Bloomberg showed that the average forecast from analysts was an EPS of $1.39 and revenue of $14.1 billion.

Broadcom's Semiconductors segment reported revenue of $8.23 billion in the fourth quarter, an increase of 12%. Software sales surged nearly 200%, reaching $5.82 billion. The company's scale is much larger than a year ago, partly due to the approximately $69 billion acquisition of VMware Inc.