Broadcom(US:AVGO) 智通财经网·2025-07-11 08:03Core Viewpoint - Morgan Stanley's report highlights strong demand trends in artificial intelligence (AI) driving growth for Broadcom's custom AI XPU business and high-performance networking product portfolio [1][3] Group 1: AI Demand and Market Potential - AI demand remains robust, with inference workloads creating additional demand that was not included in the previous 2027 serviceable available market (SAM) forecast, indicating potential upside [2] - The execution in product technology development is strong, with 2nm 3.5D AI XPU products expected to complete tape-out this year, and the first generation AI XPU products also anticipated to complete tape-out, with partnerships established with key potential clients [2][3] Group 2: Networking and Non-AI Business Recovery - AI computing workloads are driving strong networking demand, significantly enhancing unit value in expanded networks, providing substantial revenue capture opportunities [2] - Non-AI semiconductor business is experiencing a "U-shaped" gradual recovery, with observed order/reservation inflection points expected to drive earnings per share (EPS) upgrades next year [2] Group 3: VMware and Overall Financial Outlook - The VMware Cloud Foundation (VCF) platform transition is expected to continue driving strong growth for VMware business, projected to reach an annual revenue of $20 billion by the end of 2026 or 2027, with growth rates returning to mid to high single digits thereafter [2] - Despite some margin pressure in AI XPU business, overall semiconductor operating profit margins are expected to continue expanding due to operational leverage, with management focusing on reinvestment in AI growth opportunities rather than acquisitions [3] Group 4: Market Position and Valuation - Broadcom is positioned as the second-largest AI semiconductor supplier globally and the largest custom chip (ASIC) supplier, with a strong presence in wireless communication, data center networking, AI/deep learning ASICs, storage, and infrastructure silicon chips [3][4] - Morgan Stanley maintains a price target of $325 for Broadcom by December 2025, representing approximately 18% upside from the closing price of $275.4 on July 10 [3]