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**Broadcom’s Stock Price Rises as Need for AI Chips Powers Robust Profits and Projections**
**Important Points**
* The Broadcom chip manufacturer saw its stock price increase in pre-market trading on Friday after reporting quarterly results and projections that surpassed analysts’ expectations, driven by significant need for its AI semiconductor products.
* The firm reported a 77% rise in AI chip sales this quarter and expects continued gains in the industry.
* Citigroup upheld a “Buy” rating on the stock with a $220 price target, citing “upside from AI.”
Shares of chipmaker Broadcom (AVGO) jumped over 8% in pre-market trading Friday after the company released quarterly results and projections that exceeded analysts’ estimates, boosted by robust need for its artificial intelligence (AI) semiconductor products.
Broadcom reported adjusted profits per share (EPS) of $1.60 and revenue up 25% year-over-year to $14.92 billion, both surpassing Visible Alpha’s expectations. Its current-quarter revenue projection of $14.9 billion is slightly above the consensus estimate.
The company stated that its AI TruBit Collaborates with Morpho to Introduce DeFi Unearned Revenue in Latin America increased by 77% this quarter and anticipates additional gains in the sector.
Citigroup restated its “Buy” rating on the stock with a $220 price target, noting “upside from AI” and suggesting that the chipmaker’s strength in AI will offset any potential “headwinds” from sanctions against TikTok’s parent company, ByteDance, and the possible loss of radio frequency (RF) chip business with Apple (AAPL). Citigroup estimates that ByteDance in China and the Apple RF chip business will account for roughly 2% of Broadcom’s fiscal 2025 sales.
Former U.S. President Donald Trump set an April 5 deadline for the sale or ban of TikTok, but The Hill quoted him as saying that the deadline could be extended if a deal is not reached. Meanwhile, Apple iPhone sales have been slowing, threatening the RF chip business.
Since Thursday, Broadcom’s shares have risen by about 33% over the last 12 months. However, the start of the year proved somewhat unstable. Shareholders grew restless regarding the substantial AI investments that technology behemoths were undertaking. Furthermore, anxieties arose concerning how possible regulations from the Trump government could affect levies and the dispatch of those vital AI semiconductors.
