Broadcom jumps as Alphabet raises $80B, Anthropic files IPO

Broadcom shares climbed more than 4% on Tuesday as investors reacted to several developments tied to artificial intelligence spending ahead of the company’s quarterly report.

Alphabet said it will raise $80 billion through stock offerings to fund AI computing infrastructure, including a $10 billion commitment from Berkshire Hathaway. Alphabet said the proceeds will be used to expand data-center capacity for AI workloads.

Some shareholders expressed concern that the fundraising could dilute existing holdings. Market activity nonetheless reflected increased investor focus on spending by cloud providers on chips, networking equipment and other data-center hardware.

Broadcom supplies components and custom designs to major cloud operators, including work on Google’s Tensor Processing Units, the specialized chips used for large-scale AI tasks. The company also sells networking technologies, Ethernet switches and application-specific integrated circuits to hyperscale data centers.

Nvidia CEO Jensen Huang described Marvell as a potential “next trillion-dollar company,” highlighting the role of networking and connectivity chips in data centers where many processors must exchange data quickly. Traders treated the remarks as favorable for firms that supply similar infrastructure, including Broadcom.

Anthropic confidentially filed for a U.S. initial public offering. The developer of the Claude model is expanding its cloud needs, and analysts identified hardware vendors as likely beneficiaries of that growth. IG Markets analyst Fabien Yip named Broadcom and Nvidia among the most direct hardware beneficiaries. Broadcom has an agreement to provide 3.5 gigawatts of TPU capacity starting in 2027.

Analysts polled by Visible Alpha expect Broadcom to report fiscal second-quarter revenue of about $22 billion, a 47% year-over-year increase, and adjusted earnings per share of roughly $2.39 versus $1.58 a year earlier. Oppenheimer analyst Rick Schafer reiterated a Buy rating and a $450 price target and wrote that he expects upside in the quarter and the following quarter led by AI. UBS raised its price target to $490 from $475, citing Broadcom’s expanding AI customer base and new design wins. Of 11 analysts tracked by Visible Alpha, 10 rate the stock as a Buy.

Broadcom’s shares have risen more than 32% year to date and about 84% over the past 12 months. The company is scheduled to report fiscal second-quarter results on Wednesday, which investors will use to assess near-term revenue and demand trends.