Broadcom’s artificial intelligence (AI) semiconductor business is expected to maintain its steep growth trajectory through fiscal 2027. As Big Tech companies such as Google and Meta expand their in-house AI chip development, Broadcom’s AI-related revenue alone is projected to reach $116 billion (approximately 160.5 trillion won) in fiscal 2027.

Global investment bank Citi, in a preview report issued on the 19th ahead of Broadcom’s earnings release next month, forecast fiscal 2027 AI revenue of $116 billion. Broadcom is scheduled to report fiscal 2026 third-quarter (May–August) results on the 2nd of next month.

Citi maintained its “Buy” rating on Broadcom with a $500 price target. The bank noted that investors will likely focus more on the 2027 AI business outlook than on the immediate quarterly results.

Citi’s estimate for Broadcom’s total fiscal 2027 revenue stands at $166.5 billion (approximately 230.4 trillion won). If that forecast holds, roughly $7 of every $10 in total revenue would come from the AI business.

At the center of this growth are AI chips developed directly by Big Tech companies such as Google and Meta. Broadcom handles application-specific integrated circuit (ASIC) design optimized for specific AI services on behalf of these firms.

Citi expects Broadcom’s AI ASIC revenue share to rise to 44% in the October quarter and surpass 55% by the second half of 2028. Within fiscal 2027 AI revenue, Google and large language model (LLM) companies alone are estimated to account for $90.3 billion (approximately 125 trillion won).

However, the key variable lies not in AI chip demand but in the availability of data centers and power to run them. Citi noted that delays in data center construction, power procurement, and regulatory approvals could push some AI investments into 2028. In other words, while there is no shortage of customers needing AI chips, the data centers required to operate them may not be ready in time.

Expanding Cooperation with Samsung Electronics

Broadcom’s AI business expansion is closely intertwined with South Korea’s Samsung Electronics (005930.KS). Samsung Electronics and Broadcom signed a memorandum of understanding (MOU) last month to pursue cooperation worth more than $200 billion (approximately 276.8 trillion won) over five years through 2030 in the memory and foundry sectors.

The scope of cooperation spans advanced memory such as HBM, sub-2-nanometer (nm) foundry processes, and advanced packaging. Citi expects that as AI ASICs become more sophisticated, the HBM capacity embedded in each chip will also increase. The structure is such that Broadcom’s AI chip sales growth coincides with rising HBM content per chip.

Reuters, at the time of the cooperation announcement, assessed that securing Broadcom volume could raise utilization rates at Samsung Electronics’ advanced semiconductor production facilities and “help strengthen its foundry business.” The news agency also noted it could help narrow the gap with TSMC, the foundry leader.

Expectations for the memory business are also emerging. According to Barron’s, JPMorgan forecast that “Samsung will maintain its position as a key HBM supplier to Broadcom.” JPMorgan further estimated that “over the next five years, 90–95% of Broadcom’s semiconductor purchases from Samsung Electronics will be memory, with 5–10% being foundry wafers.”

Samsung’s foundry situation has also shown recent improvement. Reuters reported the previous day that Samsung Electronics has raised prices for new orders on certain advanced nodes, including 4nm and 5nm, by up to 15% amid rising AI semiconductor demand. The analysis suggests that as TSMC’s production capacity tightens, orders are shifting to other players such as Samsung Electronics.

Marvell’s Expanded Google Deal Signals Competitive Shift

Meanwhile, changes are being detected in Broadcom’s dominant position. Marvell Technology (MRVL) disclosed an expanded custom chip agreement with Google on the 19th. Marvell agreed to develop a range of custom semiconductors for Google’s AI systems and issued warrants to Google for up to 58.97 million Marvell shares at an exercise price of $206.58 per share. The total value upon full exercise amounts to approximately $12.2 billion (approximately 16.9 trillion won).

The warrants do not impose an immediate investment obligation on Google. According to Marvell’s Securities and Exchange Commission (SEC) filing, only about 1.4 million shares are provided to Google in the first year, with the remainder tied to purchase performance. The structure unlocks one block of shares for every $500 million (approximately 690 billion won) in custom chip revenue generated from Google between fiscal Q3 2027 and fiscal 2033. To secure the full equity stake, Google would need to purchase approximately $120 billion (approximately 166.1 trillion won) worth of Marvell products during that period.

Google has historically relied primarily on Broadcom for co-designing its in-house AI chip, the Tensor Processing Unit (TPU). This agreement adds Marvell as a second major supplier. Marvell already produces custom silicon for Amazon (AMZN) and Microsoft (MSFT), meaning the Google deal gives it relationships with all three major U.S. cloud providers.

On the day of the announcement, Marvell shares surged approximately 10% to close near $234. In contrast, Broadcom shares fell about 4–5% the same day. However, Broadcom holds a long-term contract with Google extending through 2031, leading to the assessment that this represents additional competition rather than replacement.

Morningstar analyst William Kerwin characterized the deal as a strong win for Marvell, while explaining that Google is not abandoning Broadcom but rather adding a supplier.

Market Impact and Outlook

As Broadcom’s AI business continues to expand, Samsung Electronics finds itself positioned to capture opportunities in both HBM and foundry. Big Tech’s AI infrastructure investment is expected to exceed $700 billion (approximately 968.7 trillion won) this year, and rising AI chip demand translates directly into higher HBM content per chip.

That said, Marvell’s Google agreement could pose a longer-term challenge to Broadcom’s dominant position in the AI ASIC market. While Broadcom still maintains a leading role in Google TPU design, competitive intensity is expected to rise as Marvell expands into inference accelerators, storage controllers, networking hardware, and memory technologies.

Investors’ next focal points are Broadcom’s earnings release on the 2nd of next month and Marvell’s quarterly results on August 27. Analysts suggest that Marvell management’s commentary on Google demand will matter more than the warrant headlines.