A Broadcom circuit board for chip testing is photographed during a lab tour as Broadcom prepares to launch new optical chip technology to fend off Nvidia on September 5, 2025 in San Jose, California, USA.
Brittany Hosea-Small | Reuters
broadcom Stocks rose more than 10% on Monday as investors flooded back into several fast-growing tech companies tied to artificial intelligence trading. Wall Street is also eyeing the chipmaker as a derivative play. of the alphabet The superiority of AI will increase.
Broadcom, one of the largest suppliers of high-performance application-specific chips (ASICs) for hyperscalers, has been underperforming this year, up 60% year-to-date. Broadcom stock was on pace for its best day since April 9 on Monday. The stock has also been the best performer on the market. Technology Select Sector SPDR Fund (XLK)which tracks the S&P 500 tech sector.
Broadcom’s move comes as investors continue to push shares of Google’s parent company higher. alphabet Higher. The stock rose more than 5% as the artificial intelligence industry regained some of the ground it had recently lost.
The two are related through an ASIC. Google is a major customer of Broadcom’s ASIC business, as Broadcom helps Google design and manufacture tensor processing units (TPUs). These are Google’s internal AI chips and are used in our internal AI infrastructure. Google TPUs are considered competitors to Nvidia’s graphics processing units (GPUs) for AI workloads.
Analysts recently raised their outlook for Broadcom regarding its relationship with Alphabet.
Melius Research’s Ben Reitz reiterated his buy rating on Broadcom last month and raised his price target on the stock by $60 to $475. This suggests a potential upside of 39.6% from Friday’s close.
“Google and its partner Broadcom have been working on this custom ASIC since 2016, and it’s now in its seventh generation. Outside of Nvidia GPUs for AI workloads, the TPU is the most proven ASIC and currently has the most visible momentum. The decision to develop this product early is now starting to have an upward impact, increasing Broadcom’s AI revenue and Google Cloud (GCP). ,” Reitzes said. he wrote in an Oct. 27 memo to customers.
“It’s good for Alphabet, but it could be even better for Broadcom. Working with Alphabet and a number of other partners who need some of this design expertise could have a big upside for AI revenue,” he added. “TPUs are quickly becoming a big part of Alphabet’s growth strategy.”
Broadcom stock performance over the past year.
Jefferies analyst Blaine Curtis, who has the highest price target of any Broadcom analyst, named Broadcom stock a top stock earlier this month, saying ASICs are reaching an “inflection point” as Google’s need for custom chips continues to grow, according to LSEG.
“Google has long been a major ASIC customer for AVGO, but with C26/27 those volumes should become more meaningful,” Curtis wrote in a Nov. 3 memo. “Google continues to increase the amount of tokens it processes each month, going from 480T in April 2025 to 1,300T in October 2025. This amount should increase further as the multimodal model requires computing.”
Curtis rates the stock a buy and raised his price target by $65 to $480. This means the stock could rise an additional 41%.
Dan Ives, global head of technology research at Wedbush Securities, told CNBC he is very bullish on Broadcom and Alphabet.
“Broadcom and Alphabet are the new AI players that are rediscovering the huge market for ASIC chips, with Google leading the way,” he said. “This may be the most proven ASIC chip on the market, and the AI revolution is still in its early stages. It was a historic rapid turnaround against today’s very bullish street sentiment.
Alphabet’s stock has risen 21% over the past month, outperforming its Magnificent Seven peers and lifting the broader market in recent trading. Investors have responded positively to Google’s latest AI model Gemini 3, its upcoming 7th generation TPU called ‘Ironwood’, advances in AI image generation with Nano Banana Pro, and a new agent platform called ‘Google Antigravity’.
