Jefferies sees Broadcom (AVGO, Financial) doubling down on AI chips and networking as it targets the seven biggest LLM builders worldwide, while backing its own scale-up links to challenge Nvidia's dominance.
In a note led by Blayne Curtis, Jefferies reiterated Broadcom's Buy rating and nudged its price target to $315, arguing that Broadcom's ASIC roadmap remains locked in with top AI developers—even amid rumors of share losses.
The firm highlights Broadcom's play in both Tomahawk and Jericho switch families to capture a “scale-up” networking market they forecast to be five to ten times larger than traditional scale-out setups.
Broadcom is also primed to start ramping Google's Ironwood TPU in H2 2025 and plans to keep HBM production in-house to safeguard quality, with HBM4 chips already on the roadmap.
As hyperscalers race to build custom AI silicon, being one of only a handful of ASIC suppliers cements Broadcom's strategic role—and gives it pricing power. Meanwhile, nipping at Nvidia's heels in high-speed interconnects could unlock a massive new revenue stream, since scale-up networks are critical for linking ever-larger GPU and TPU clusters.
With Jefferies forecasting continued engagement from leading AI players and Broadcom's own supply-chain controls in place, the firm expects AVGO to outpace peers in capturing both chip and networking budgets—key drivers as the AI infrastructure boom accelerates.
