Latest news with #Tomahawk6
Yahoo
07-08-2025
- Business
- Yahoo
AVGO Expands Data Center Portfolio With Jericho4: Hold the Stock?
Broadcom AVGO is now shipping the Jericho4 Ethernet fabric router that has the ability to interconnect more than one million custom AI accelerators (XPUs) across multiple data centers. A single Jericho4 system scales to 36,000 HyperPorts, each operating at 3.2 Tb/s, with deep buffering, line-rate MACsec (to protect data moving between data centers), and RoCE transport of more than 100km+ distances. This enables the Jericho4 family of routers to offer unmatched bandwidth, security and lossless helps Broadcom offer a complete portfolio of networking solutions that includes the Tomahawk 6, Tomahawk Ultra and NICs. A strong portfolio is helping Broadcom gain market share among hyperscalers. Strong demand for AI networking revenues, which jumped 170% year over year, represented 40% of AI revenues in the second quarter of 2025, and has been a key catalyst. The company has been expanding its portfolio in recent June, AVGO announced the shipment of its Tomahawk 6, the world's first 102.4 Terabits/sec Ethernet switch. Designed to meet the escalating demands of AI-driven data centers, Tomahawk 6 delivers double the bandwidth of its predecessor, enhancing scalability and energy efficiency. In mid-July, AVGO announced shipping of Tomahawk Ultra, its Ethernet switch, which achieves 250ns switch latency at full 51.2 Tbps throughput. Tomahawk Ultra delivers line-rate switching performance even at minimum packet sizes of 64 bytes, supporting up to 77 billion packets per second. Strong portfolio and rich partner base are helping to drive AVGO's prospects. Broadcom shares have risen 30.4% year to date, outperforming the Zacks Electronics Semiconductors industry's return of 16.1% and the Zacks Computer and Technology sector's appreciation of 10.9%. AVGO is benefiting from an expanding portfolio, rich partner base, solid VMware business, strong balance sheet and impressive free cash flow. AVGO has outperformed its peers, including Cisco Systems CSCO and Marvell Technology MRVL. While Cisco shares have returned 16.9% YTD, Marvell Technology shares have dropped 32%. AVGO Stock's Performance Image Source: Zacks Investment Research Solid Portfolio, Rich Partner Base to Boost AVGO's Prospects Broadcom is benefiting from strong demand for XPUs, which are a type of application-specific integrated chips (ASICs) necessary to train Generative AI models. They require complex integration of compute, memory, and I/O capabilities to achieve the necessary performance at lower power consumption and cost. In the second quarter of fiscal 2025, XPU revenues grew double digits year over year. Alphabet and Meta Platforms META are notable users of Broadcom's rich partner base, including NVIDIA, Arista Networks, Alphabet, Dell Technologies, Meta Platform, Juniper and Supermicro, has been a key catalyst. These factors are expected to drive strong AI revenues. AVGO expects third-quarter fiscal 2025 AI revenues to jump 60% year over year to $5.1 billion. Broadcom's focus on delivering AI-powered, proactive security to stay ahead of evolving cyber threats has been noteworthy. In March, AVGO introduced updates to VMware vDefend, improving security planning, lifecycle management and scalability for VMware Cloud Foundation with new tools like the Security Segmentation Assessment and Report, optimized micro-segmentation, and advanced Network Detection and Response, all aimed at improving threat prevention and operational efficiency. In April, Broadcom introduced Incident Prediction, which extends the security feature of Adaptive Protection, a unique capability of Symantec Endpoint Security Complete. Strong Liquidity Bodes Well for AVGO Broadcom benefits from a strong balance sheet and its free cash-flow-generating ability. As of May 4, 2025, cash and cash equivalents were $9.47 billion, and Broadcom generated $6.55 billion in cash flow from operations. Free cash flow was $6.41 billion and accounted for 43% of revenue at the end of the second quarter of fiscal strong balance sheet is helping AVGO lower leverage, pay consistent dividends and return cash to shareholders through buybacks. The company recently paid off $1.6 billion of debt, resulting in gross principal debt of $67.8 billion. Broadcom paid $2.8 billion of cash dividends and purchased $4.2 billion, or approximately 25 million shares of common stock, in the second quarter of fiscal 2025. AVGO Offers Modest Third-Quarter Guidance Broadcom's third-quarter fiscal 2025 guidance reflects sluggishness in server storage, wireless and industrial businesses. Third-quarter fiscal revenue guidance of $15.8 billion suggests 21% year-over-year growth but indicates modest sequential growth. Gross margin is expected to decline roughly 130 basis points sequentially, reflecting a higher mix of XPUs with AI revenues. A higher mix of lower-margin XPUs in the revenue mix is expected to keep gross margin under pressure throughout fiscal Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at $1.66 per share, unchanged over the past 30 days, indicating 33.87% year-over-year growth. Broadcom Inc. Price and Consensus Broadcom Inc. price-consensus-chart | Broadcom Inc. Quote AVGO Shares Trading at a Premium AVGO stock is trading at a premium, as suggested by the Value Score of terms of the forward 12-month Price/Sales, AVGO is trading at 19.59X, higher than the sector's 6.62X, Cisco's 4.62X and Marvell Technology's 7.22X. Price/Sales Ratio (F12M) Image Source: Zacks Investment Research Conclusion Broadcom's expanding AI portfolio, along with a rich partner base, reflects solid top-line growth potential. These are good reasons to hold the stock for long-term declining gross margin, along with a challenging macroeconomic condition, doesn't justify the premium currently carries a Zacks Rank #3 (Hold), which implies that investors should wait for a more favorable point to accumulate the stock. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Marvell Technology, Inc. (MRVL) : Free Stock Analysis Report Broadcom Inc. (AVGO) : Free Stock Analysis Report Meta Platforms, Inc. (META) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Business Insider
10-07-2025
- Business
- Business Insider
'Fire on All Cylinders' Assessment from JPMorgan Proves Help Enough for Broadcom (NASDAQ:AVGO)
While the chip market these days is looking less like a market and more like a piranha tank surrounded by clumsy cattle, chip stock Broadcom (AVGO) is making some headway. In fact, word from analysts at JPMorgan say that Broadcom is looking really good right now. Investors followed suit and bought in, sending shares up nearly 2% in Wednesday afternoon's trading. Don't Miss TipRanks' Half-Year Sale Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. JPMorgan analyst Harlan Sur —who has a five-star rating on TipRanks—kept his Overweight rating on the stock and also kept a $325 per share price target. That represents, reports noted, a roughly 20% upside against Broadcom's closing price on Tuesday. Sur was quite impressed, following a meeting with Broadcom brass in which they showed off a rising demand for artificial intelligence. Granted, most of us likely already knew there would be brisk demand for artificial intelligence anything these days, but the confirmation is valuable too. Plus, Broadcom execs noted that there were 'gradual recovery trends' in the businesses not directly touched by the golden wand that is AI. This in turn led Sur to believe that Broadcom is, basically, in line for a 'U-shaped recovery' as it is currently starting to '…fire on all cylinders.' Brand New Ethernet Switch Speaking of those non- AI businesses, Broadcom also recently rolled out a new Ethernet switch known as the Tomahawk 6. The Tomahawk 6 delivers some truly impressive connectivity capability, built around a three-nanometer node with an almost frightening 102.4 terabits per second of bandwidth. The Tomahawk 6 is actually geared for data center use, which makes its dizzying numbers make sense accordingly. Reports note that the Tomahawk 6 actually doubles its predecessor's bandwidth, and will '…address…the growing bottleneck in AI training workloads where networking speed and latency increasingly limit performance.' With 102.4 terabits involved, that is not even sort of a surprise. What is the Price Target for Broadcom? Turning to Wall Street, analysts have a Strong Buy consensus rating on AVGO stock based on 27 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 55.79% rally in its share price over the past year, the average AVGO price target of $295.60 per share implies 6.39% upside potential.
Yahoo
24-06-2025
- Business
- Yahoo
Broadcom Stocks Gains 36% in 3 Months, Wall Street Sees More Upside for AVGO
Broadcom (AVGO) stock has rebounded strongly, gaining 36% in three months. This sharp rebound highlights renewed investor confidence, driven by easing concerns over a potential economic slowdown and Broadcom's solid financial performance. The company, which provides semiconductor and infrastructure software solutions, is benefitting from two major catalysts. First, demand for artificial intelligence (AI) chips continues to surge, providing a strong tailwind for its semiconductor division. Second, momentum is building in its VMware business, which Broadcom acquired in November 2023, adding significant strength to its infrastructure software portfolio. Meta's Mark Zuckerberg Says the Technology They're Developing Will 'See What You See and Hear What You Hear' The Next Trillion-Dollar Boom? 3 Stocks to Buy with 300 Million Humanoid Robots on the Horizon. 'Record-Shattering': Warren Buffett's Berkshire Hathaway Has Now Paid $101 Billion in Cumulative Federal Income Tax Markets move fast. Keep up by reading our FREE midday Barchart Brief newsletter for exclusive charts, analysis, and headlines. Wall Street is bullish on Broadcom, with analysts citing strong growth driven by rising demand for AI semiconductors. The company is expected to benefit from solid revenue in this space and improved operating efficiency, which could boost its sales and profits in the coming quarters. Moreover, the highest analyst price target for Broadcom stock tracked by Barchart is $340, suggesting potential upside of around 30% from current levels. Broadcom has consistently posted robust financial results. In its most recent quarter, the company reported consolidated revenue of $15 billion, a 20% increase from a year ago, primarily driven by its semiconductor business, which has been supercharged by demand for AI-related products. Semiconductors accounted for 56% of Broadcom's revenue during the quarter, with $8.4 billion in sales from this segment alone. AI semiconductors generated over $4.4 billion, up 46% year over year. AVGO's Q2 marked the ninth consecutive quarter of growth in AI-related chip sales, reflecting Broadcom's expanding dominance in this space. Key product lines such as its Tomahawk switches and Jericho routers are likely to see solid growth as demand for AI infrastructure accelerates. Moreover, Broadcom recently unveiled its next-generation Tomahawk 6 switch, which significantly reduces latency and power consumption. The new product will likely strengthen Broadcom's positioning in the AI space. Broadcom is also focusing on developing custom AI accelerators (XPUs) tailored to the specific needs of customers, which is expected to accelerate its growth. Broadcom expects the AI-driven momentum in its business to carry through 2026. For the current quarter (Q3), it has forecast AI semiconductor revenue of $5.1 billion, a year-over-year increase of 60%. While AI is driving Broadcom's broader semiconductor portfolio, non-AI semiconductor revenue remains subdued. Nonetheless, its broadband and enterprise networking revenues are showing signs of recovery, supporting future revenue growth. Besides semiconductors, the company's infrastructure software solutions are likely to support its growth. In Q2, software revenue hit $6.6 billion, up 25% year-over-year. The conversion of enterprise customers from perpetual licenses to VMware Cloud Foundation (VCF) subscriptions has created a solid recurring revenue business. The positive trajectory is expected to continue in the software segment. For Q3, Broadcom anticipates infrastructure software revenue of $6.7 billion, a 16% increase year-over-year. Even with the recent recovery in its stock price, AVGO remains appealing from a valuation perspective. Broadcom trades at a forward price-earnings (P/E) multiple of 45.7x, which may seem high at first glance, but is justified by the company's rapid earnings growth. Wall Street expects AVGO's earnings per share (EPS) to rise 47.4% in fiscal 2025 and more than 28% in 2026. In short, Broadcom is likely to benefit from solid AI demand, focus on offering custom accelerators, and a growing infrastructure software business. Broadcom's recent rally reflects strong investor confidence backed by solid demand for AI semiconductors and a rapidly expanding infrastructure software portfolio. With demand for AI chips supporting future revenue growth and Broadcom's focus on improving efficiency, the company will likely deliver solid earnings growth. Analysts remain optimistic and maintain a 'Strong Buy' consensus rating on AVGO, indicating upside potential as the company's Tomahawk 6 switch and custom AI accelerators gain traction. Further, as AI adoption accelerates and recurring software revenue builds, Broadcom stands to deliver solid returns — with a price target of $340 within reach. On the date of publication, Sneha Nahata did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
20-06-2025
- Business
- Yahoo
Marvell's AI Bet: Will NVLink and UALink Drive Custom Chip Wins?
Marvell Technology MRVL is enhancing its role in artificial intelligence (AI) infrastructure by expanding its custom chip capabilities. Marvell continues to integrate its custom compute platform with new components that improve performance, scalability, and integration across large-scale the first quarter of fiscal 2026, Marvell reported record Data Center revenues of $1.44 billion, up 76% year over year. The growth was driven by the rapid scaling of custom AI silicon. To support continued momentum, Marvell recently announced multiple strategic additions to its custom silicon May 2025, Marvell partnered with NVIDIA to offer NVIDIA's NVLink Fusion technology to customers deploying Marvell's custom cloud platform silicon. This enables custom XPUs to connect with NVIDIA's rack-scale hardware architecture. Marvell noted that its custom silicon with NVIDIA NVLink Fusion offers its customers greater flexibility and options in developing next-generation AI infrastructure. This announcement reflects that MRVL's custom chips are gaining credibility and traction, even among companies like the same month, Marvell introduced its new multi-die packaging solution, which is built on its proprietary interposer technology. The solution is already in production for a customer-specific XPU program. The platform enables more efficient die-to-die interconnect, lowers power consumption, enhances yield and lowers product this month, Marvell introduced a third addition to its custom platform — Ultra Accelerator Link (UALink) scale-up solution. The solution delivers an open-standards-based scale-up interconnect platform with high compute utilization and low latency. UALink is paired with Marvell custom silicon capabilities. This allows compute vendors to build solutions, including custom accelerators with UALink controllers and custom switches, enabling optimal performance for rack-scale these additions support Marvell's push to enable full rack-level custom infrastructure. Moreover, with new components entering production, Marvell is positioned to play a crucial role in powering the next generation of large-scale AI systems. Advanced Micro Devices AMD is advancing its rack-level AI solutions through its acquisition of ZT Systems. This acquisition enables Advanced Micro Devices to reduce deployment time for hyperscalers by combining AMD's CPUs, GPUs, and networking components. This move also enables Advanced Micro Devices to accelerate time to market for its OEM and ODM AVGO is aggressively scaling its AI networking portfolio. In the second quarter of fiscal 2025, AVGO's AI networking revenues jumped 170% year over year and now comprise 40% of its total AI semiconductor revenues. Broadcom also introduced the Tomahawk 6 switch with a 102.4 Terabits per second switch capacity. It is designed to enable AI clusters of over 100,000 AI accelerators to be deployed in 2 tiers. This move enables Broadcom to achieve better performance in training its next-generation frontier models through lower latency, higher bandwidth and lower power. Shares of Marvell Technology have plunged 31.9% year to date against the Electronics - Semiconductors industry's growth of 6.4%. Image Source: Zacks Investment Research From a valuation standpoint, Marvell Technology trades at a forward price-to-sales ratio of 7.36X, lower than the industry's average of 8.15X. Image Source: Zacks Investment Research The Zacks Consensus Estimate for MRVL's fiscal 2026 and fiscal 2027 earnings implies year-over-year growth of 77.71% and 27.73%, respectively. The earnings estimates for fiscal 2026 and fiscal 2027 have been revised upward in the past 30 days and seven days, respectively. Image Source: Zacks Investment Research MRVL currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report Marvell Technology, Inc. (MRVL) : Free Stock Analysis Report Broadcom Inc. (AVGO) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
10-06-2025
- Business
- Yahoo
Broadcom Dips 6% Post Q2 Earnings: Is the AVGO Stock Still a Buy?
Broadcom AVGO shares dropped 6.2% in the past couple of trading sessions following the company's second-quarter fiscal 2025 results on Thursday, last week. AVGO reported earnings of $1.58 per share that beat the Zacks Consensus Estimate by 0.64% while revenues of $15 billion surpassed the consensus mark by 0.37%. AVGO benefited from strong AI semiconductor revenues (up 46% year over year to $4.4 billion) and momentum in the VMware business. However, third-quarter fiscal 2025 guidance reflects sluggishness in server storage, wireless and industrial businesses. Third-quarter fiscal revenue guidance of $15.8 billion suggests 21% year-over-year growth but indicates modest sequential growth. Gross margin is expected to decline roughly 130 basis points sequentially, reflecting a higher mix of custom AI accelerators (XPUs) with AI revenues. A higher mix of lower-margin XPUs in the revenue mix is expected to keep gross margin under pressure throughout fiscal which are a type of application-specific integrated chips (ASICs), are necessary to train Generative AI models, and they require complex integration of compute, memory, and I/O capabilities to achieve the necessary performance at lower power consumption and cost. Strong demand for Broadcom's ASICs is driving top-line growth. In the second quarter of fiscal 2025, XPU revenues grew double digits year over year. Alphabet and Meta Platforms META are notable users of Broadcom's ASICs. Year to date (YTD), Broadcom shares have appreciated 5.2%, outperforming the Zacks Electronics Semiconductors industry's return of 3% and the Zacks Computer and Technology sector's 1.8%. AVGO is benefiting from an expanding portfolio, rich partner base, solid VMware business, strong balance sheet and impressive free cash flow. Broadcom has outperformed its semiconductor peers, including Advanced Micro Devices AMD and Marvell Technology MRVL. While AMD shares have returned 0.6% YTD, Marvell Technology shares have dropped 37.4%. Image Source: Zacks Investment Research So, is the Broadcom stock still a buy? Let's find out. Broadcom's innovative portfolio has been a key catalyst. Strong demand for AI networking revenues, which jumped 170% year over year, represented 40% of AI revenues. Broadcom's networking portfolio, which comprises Tomahawk switches, Jericho routers and NICs, is helping it gain market share among hyperscalers. The launch of the next-gen Tomahawk 6 switch is a game changer as it enables clusters of more than 100,000 AI accelerators to be deployed in only two tiers instead of three. Reduction in lower tier offers lower latency, higher bandwidth and reduced power consumption that enables much better performance in training next-generation frontier focus on delivering AI-powered, proactive security to stay ahead of evolving cyber threats has been noteworthy. In March, AVGO introduced updates to VMware vDefend, improving security planning, lifecycle management, and scalability for VMware Cloud Foundation with new tools like the Security Segmentation Assessment and Report, optimized micro-segmentation, and advanced Network Detection and Response, all aimed at improving threat prevention and operational efficiency. In April, Broadcom introduced Incident Prediction, which extends the security feature of Adaptive Protection, a unique capability of Symantec Endpoint Security Complete (SES-C).AVGO sees massive opportunities in the AI space as its three hyperscaler customers have started to develop their own XPUs. It believes that by 2027, each of AVGO's three hyperscalers plans to deploy 1 million XPU clusters across a single rich partner base, including NVIDIA, Arista Networks, Alphabet, Dell Technologies, Meta Platform, Juniper and Supermicro, has been a key catalyst. These factors are expected to drive strong AI revenues. AVGO expects third-quarter fiscal 2025 AI revenues to jump 60% year over year to $5.1 billion. Broadcom benefits from a strong balance sheet and its free cash-flow-generating ability. As of May 4, 2025, cash and cash equivalents were $9.47 billion, and Broadcom generated $6.55 billion in cash flow from operations. Free cash flow was $6.41 billion and accounted for 43% of revenue at the end of the second quarter of fiscal strong balance sheet is helping AVGO lower leverage, pay consistent dividends and return cash to shareholders through buybacks. The company recently paid off $1.6 billion of debt, resulting in gross principal debt of $67.8 billion. Broadcom paid $2.8 billion of cash dividends and purchased $4.2 billion, or approximately 25 million shares of common stock, in the second quarter of fiscal 2025. The Zacks Consensus Estimate for fiscal 2025 earnings is pegged at $6.63 per share, up by a penny over the past 30 days, indicating 36.14% year-over-year growth. Broadcom Inc. price-consensus-chart | Broadcom Inc. Quote The consensus estimate for fiscal third-quarter earnings is pegged at $1.68 per share, up a penny over the past 30 days, indicating 35.48% year-over-year growth. AVGO stock is trading at a premium, as suggested by the Value Score of terms of the forward 12-month Price/Sales, AVGO is trading at 16.69X, higher than the sector's 6.38X, AMD's 5.79X and Marvell Technology's 6.83X. Image Source: Zacks Investment Research Broadcom's expanding AI portfolio, along with a rich partner base, reflects solid top-line growth potential. These factors justify the premium currently carries a Zacks Rank #2 (Buy), which implies investors should start accumulating the stock right now. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report Marvell Technology, Inc. (MRVL) : Free Stock Analysis Report Broadcom Inc. (AVGO) : Free Stock Analysis Report Meta Platforms, Inc. (META) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
