Semiwiki on LinkedIn Semiwiki on Facebook Semiwiki on Twitter Register / Log in 
Array
(
    [content] => 
    [params] => Array
        (
            [0] => /forum/threads/im-having-trouble-understanding-broadcoms-claimed-ai-revenue-results-and-projections.24678/
        )

    [addOns] => Array
        (
            [DL6/MLTP] => 13
            [Hampel/TimeZoneDebug] => 1000070
            [SV/ChangePostDate] => 2010200
            [SemiWiki/Newsletter] => 1000010
            [SemiWiki/WPMenu] => 1000010
            [SemiWiki/XPressExtend] => 1000010
            [ThemeHouse/XLink] => 1000970
            [ThemeHouse/XPress] => 1010570
            [XF] => 2030970
            [XFI] => 1060170
        )

    [wordpress] => /var/www/html
)

I'm having trouble understanding Broadcom's claimed AI revenue results and projections

B

blueone

Well-known member
Broadcom announced results for for 1Q26:



Broadcom is claiming Q1 "AI Revenue" of $8.4B, based mostly on "robust demand for custom AI accelerators and AI networking". Looking at these reports, Broadcom doesn't break down revenue contributions from Ethernet Products, which they just ascribe everything to "AI Networking", and "custom AI accelerators", like the Google TPUs, which Broadcom calls XPUs.

The S&P Global revenue chart for 2025 states that XPU revenue is much bigger than the Ethernet products revenue.

1772680776650.png


The XPU revenue looks to be about $11B-12B in 2025. My question is, how could Broadcom achieve such high unit revenue for chips unless they were actually selling the chips made and packaged by TSMC (or others) to the hyperscalers? This implies that Broadcom is managing the entire chip engineering process and owning the relationship with TSMC, and selling completed units to the hyperscalers, just like Intel or AMD would.

This isn't what I thought was going on. I thought the hyperscalers owned the business relationship with TSMC, especially Google. Volume-wise, the only two hyperscale customers that matter are AWS and Google. AWS chip design, AKA Annapurna Labs, does its own backend engineering. So where is all of Broadcom's revenue and unit volume for AI XPUs coming from?

Hence my confusion.
 
It looks to me like a fairly textbook case of building customer specific SoCs. Granted, these designs may also include custom packaging also handled by the vendor. Hock is just demanding a better rate of pay now.

Many years back I worked for the storage BU for Agere/LSI Logic* and that model was the same: customer has some secret sauce IP along with a digital "back end", but contracted us to provide the Phys and other analog "front end" IP and all the connecting logic like link layers and etc. We would handle all the integration, layout, test and sometimes even multi chip modules**, even back then. Chip fab was usually at TSMC (occasionally with a second source) at that time, and we worked closely with the fab to handle any issues. We got paid pretty decently to take on those roles and risks.

I think Hock and Co. are running that same model, on steroids. One thing Hock is great at, is finding a price that the customer will swallow that also makes great margins for him.

*: now part of AVGO

**: grudgingly, for there was great risk involved with handling the Known Good Dies model at that time, and the volumes for these was rather low
 
You must log in or register to reply here.
Back
Top