Broadcom raised its year-end forecast for income from chips used in artificial intelligence work by 10% in an effort to take advantage of the spike in its shares this year.
In order to capitalize on the surge in its shares this year, Broadcom (AVGO.O) increased its yearly prediction for revenue from chips used in artificial intelligence work by 10% on Wednesday. It also announced a split of its shares. In extended trading, the Palo Alto, California-based chipmaker’s shares rose 12%. The business has increased its sales prediction from $10 billion to $11 billion for AI-linked chips by 2024. Broadcom is one of the companies benefiting from enterprises substantially investing in the boom since it makes cutting-edge networking chips that help transfer enormous amounts of data used by AI applications like OpenAI’s ChatGPT.
In the second quarter, Broadcom reported $3.1 billion in revenue from AI products. The company is planning a 10-for-1 forward stock split in an effort to lower the price of its shares for ordinary investors. The stock has already increased by more than 30% this year, nearly doubling in 2023. It is anticipated that the split-adjusted trading will start on July 15. Large cloud providers seeking to lessen their reliance on Nvidia’s (NVDA.O.) expensive processors have placed orders with its custom chips unit. It’s often believed that Broadcom manufactures customized chips for Meta (META.O) and Google (GOOGL.O). About 6% more money was made by Broadcom’s semiconductor solutions division, which produces its networking and bespoke chips.
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