Broadcom(US:AVGO)2026-01-27 02:05Summary of Key Points from Broadcom Conference Call Company Overview - The conference call involved Broadcom's CEO, CFO, and investor relations team discussing the company's customized XPU business, commercial GPU differentiation, demand orders, and supply chain issues [1][2]. Core Insights - Demand and Order Growth: Broadcom's product demand is robust, with a reported $73 billion in AI order backlog that continues to grow since its disclosure. This figure does not include OpenAI-related orders. Management expressed strong confidence in a 10GW collaboration agreement expected to materialize between 2027 and 2029. They believe the likelihood of customers developing their own chips is very low due to the collaborative nature of XPU development, which could lead to mutual detriment [1]. - Network Business as a Growth Driver: Besides XPU, Broadcom's network business is experiencing significant growth, particularly in core areas such as 800G/1.6T Ethernet and PCIe switches. The Tomahawk series is showing strong momentum in upgrades and horizontal expansion. The market has undervalued the contribution of the network business to the company's AI order backlog [2]. - Mitigating Margin Pressure: The increase in XPU business share and the introduction of rack-level solutions may exert some pressure on Broadcom's overall gross margin. However, the high-margin network business, which accounts for approximately 30%-35% of the AI order backlog, can effectively offset this negative impact. If the revenue growth of the network business continues to meet expectations, its revenue share may exceed market forecasts, remaining a core component of AI cluster construction [2]. - Focus on Large Model Enterprises: Broadcom is targeting customized AI accelerators at enterprises developing large models or super-intelligent systems. The company believes that customized products can better optimize the integration of hardware and software in inference processes, enhancing customer ROI and TCO. Broadcom has established a leading position in the customized chip sector due to its performance advantages, although there remains uncertainty regarding the final shipment volumes of some customized projects [2]. - Supply Chain Assurance: Management expressed no concerns regarding TSMC's front-end manufacturing capacity and memory chip supply. As a top-tier customer of TSMC, Broadcom can clarify demand and secure sufficient capacity through direct collaboration with end customers. A new facility in Singapore will focus on substrates, interlayers, and advanced packaging to alleviate CoWoS capacity bottlenecks, with related products expected to launch in 2028, and further technical details to be disclosed gradually [3].