Broadcom Inc. (AVGO) shares skyrocketed over 20% in pre-market trading on Friday, following the company's impressive fiscal fourth-quarter results and bullish outlook for its artificial intelligence (AI) business. The chipmaker reported a staggering 220% year-over-year growth in AI revenue to $12.2 billion for fiscal 2024, driven by robust demand for its AI accelerators (XPUs) and Ethernet networking solutions.
The highlight of Broadcom's earnings was CEO Hock Tan's projection of a massive $60 billion to $90 billion revenue opportunity for its AI chips and networking products in fiscal 2027 alone. Tan revealed that three of Broadcom's hyperscale customers plan to deploy one million XPU clusters across a single fabric by 2027, representing a significant growth opportunity for the company's AI business.
Broadcom's strong performance in the AI segment contributed to its record fiscal 2024 consolidated revenue of $51.6 billion, up 44% year-over-year. In the fourth quarter, the company reported revenue of $14.1 billion, a 51% increase compared to the same period last year. Operating profit for Q4 stood at $8.8 billion, up 53% year-over-year.
The company's upbeat guidance for the first quarter of fiscal 2025 further fueled investor optimism. Broadcom projected revenue of approximately $14.6 billion, surpassing analysts' expectations, with semiconductor revenue expected to grow by 10% year-over-year to $8.1 billion and infrastructure software revenue anticipated to increase by 41% to $6.5 billion.
