ab 24 August 2025 Global Research US Semiconductors and Semi Equipment SemiBytes: Thoughts on INTC, AVGO Preview, SITM AI Revenue Opportunity More details on the INTC-US Government investment Friday post close, INTC and the Trump Administration finalized an agreement to convert the remaining $5.7B in CHIPS grants and the $3.2B awarded to INTC as part of the Dept of Defense secure enclave program into an equity stake. Under the terms of the agreement, the US Government will purchase ~433MM shares @ $20.47/sh ...

Core Viewpoint - UBS maintains a "Buy" rating on Broadcom (AVGO.US) and raises the target price from $290 to $345, reflecting optimism about the company's AI business development momentum [1] Group 1: Financial Performance - Broadcom is expected to report third-quarter revenue growth of 21% year-over-year, reaching $15.82 billion, with earnings per share projected at $1.66 compared to $1.24 in the same period last year [1] - Analysts anticipate that Broadcom's performance will meet expectations, with an upward revision of the fourth-quarter guidance likely [1] Group 2: AI Business Development - Google's latest AI chip, TPUv6p, relies on Broadcom's custom chip technology, which is currently ramping up production, contributing to the potential upward revision of performance guidance [1] - The production of TPUv6p is expected to significantly increase in the second half of 2025, continuing into 2026, with wafer demand projected to grow by 51% year-over-year, potentially driving a 60% year-over-year increase in Broadcom's AI business revenue in 2025 [1] Group 3: Networking and Market Potential - With the increase in Ethernet architecture deployment, AI-related networking business may accelerate in fiscal year 2026 [1] - The potential market size for Broadcom's custom chips is estimated to be between $60 billion and $90 billion [1] Group 4: Stock Performance - Broadcom's stock closed up 0.75% at $300.25, with a cumulative increase of 30% year-to-date [3]

Core Viewpoint - UBS maintains a "Buy" rating on Broadcom (AVGO.US) and raises the target price from $290 to $345, anticipating positive signals in the upcoming Q4 earnings report due to favorable unit shipment trends of Google's TPUv6p [1] Earnings Expectations - Broadcom is expected to report Q4 earnings per share of $1.66 and revenue of $15.82 billion [1] - UBS analysts predict that Broadcom will meet or exceed market expectations for Q4 revenue, which is consensus at approximately $17 billion, primarily driven by improvements in TPUv6p unit trends [1] AI Revenue Growth - The TPUv6p is projected to ramp up significantly in the second half of 2025 and continue into 2026, with wafer demand for CoWoS increasing by 51% year-over-year [1] - AI-related revenue for the fiscal year 2025 is expected to grow by approximately 60%, driven by the increasing proportion of TPUv6p in the product mix and rising average selling prices [1] Market Outlook - UBS anticipates that Broadcom will reaffirm its serviceable available market (SAM) for custom chips at $60 billion to $90 billion [1] - The network business related to AI is expected to strengthen in fiscal year 2026, supported by accelerated Ethernet architecture deployments [1]