Mizuho Sees Anthropic as Broadcom’s (AVGO) Fourth Hyperscale ASIC Partner, Raises Target

Core Viewpoint - Broadcom Inc. is gaining attention as a leading player in the AI sector, with Mizuho reiterating an "Outperform" rating and raising the price target to $435 per share from $430, indicating confidence in its growth potential in the AI ASIC market [1][2]. Group 1: Customer Expansion and Revenue Potential - Mizuho identifies Anthropic as Broadcom's fourth customer, projecting it to generate $10 billion in revenue from "AI Racks" in the second half of 2026 [2][3]. - The company is also expected to benefit from a partnership with OAI, which is anticipated to ramp up to 10GW capacity by 2026, marking it as Broadcom's fifth customer [3]. Group 2: Product Innovations and Market Position - Broadcom has launched its third-generation CPO, Tomahawk 6-Davisson, which boasts approximately 70% lower power requirements and aims for over 5 million flap-free hours for reliability [3]. - The introduction of the Thor Ultra 800G NIC with advanced features such as telemetry and load-balancing RoCE, along with the expansion of the Jericho product line, positions Broadcom favorably in the competitive landscape [3]. Group 3: Market Dynamics and Competitive Landscape - The expansion of Broadcom's total addressable market (TAM) and market share in the AI ASIC sector is noted, with the company potentially having five hyperscale ASIC customers out of an estimated seven [2][3]. - Analysts suggest that the developments surrounding Anthropic may pose challenges for competitors like Marvell (MRVL), indicating a shifting competitive landscape in the AI chip market [2][3].