Broadcom Inc.

NASDAQ Global Select
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Very Bullish +85

Broadcom vs. Marvell: The AI Supercycle Is Big Enough for Both. Here's the Better Buy.

AI infrastructure AI-generated analysis

📈 Broadcom AI semiconductor revenue surged 221% year-over-year to $16.7 billion in the third quarter of fiscal 2026.

🤝 Broadcom secured a long-term agreement with Google to supply chips for future TPU generations and networking components through 2031.

💰 The company generated $13.7 billion in free cash flow in Q3, representing nearly 46% of total revenue.

🚀 Management forecasts AI semiconductor revenue to reach approximately $58 billion for fiscal 2026 and $115 billion for fiscal 2027.

💹 Broadcom trades at roughly 21.6 times estimated fiscal 2027 earnings, significantly lower than Marvell's valuation.

📊 Analysts expect Broadcom to generate about $173.5 billion in revenue for fiscal 2027, representing nearly 64% year-over-year growth.

💻 The company maintains a large infrastructure software business that generated around $8.8 billion of revenue in the third quarter.

🏆 Broadcom is identified as offering a better risk-reward proposition due to its lower valuation relative to high growth expectations.

Bullish Signals
  • Broadcom AI semiconductor revenue surged 221% year-over-year to $16.7 billion in the third quarter of fiscal 2026, demonstrating strong demand.
  • The company expects total AI semiconductor revenue to reach approximately $58 billion for fiscal 2026 and roughly $115 billion for fiscal 2027.
  • Broadcom generated $13.7 billion in free cash flow in the third quarter, which was nearly 46% of its revenue.
  • The company has a long-term agreement with Google to supply chips for future TPU generations and networking components through 2031.
  • Broadcom trades at approximately 21.6 times estimated fiscal 2027 earnings, offering a lower valuation than Marvell's 57.3 times.
  • Analysts project Broadcom to generate about $173.5 billion in revenue for fiscal 2027, representing nearly 64% year-over-year growth.
Full Analysis
Broadcom (NASDAQ: AVGO) and Marvell Technology are both benefiting from the global AI infrastructure boom, but they trade at significantly different valuations. Broadcom reported a surge in AI semiconductor revenue of 221% year-over-year to $16.7 billion in the third quarter of fiscal 2026, with management projecting total AI semiconductor revenue to reach approximately $58 billion for the full fiscal 2026. The article highlights that Broadcom maintains a strong long-term agreement with Google to supply chips for future generations of TPUs and networking components through 2031. Despite Marvell expanding its custom silicon partnership with Google, Broadcom's established position ensures it is not losing significant business as the supplier base broadens to meet growing AI infrastructure requirements. Broadcom expects its AI semiconductor revenue to grow to roughly $115 billion in fiscal 2027 and $230 billion in fiscal 2028. The company also generated $13.7 billion in free cash flow in the third quarter, representing nearly 46% of revenue, supported by a robust infrastructure software business that generated $8.8 billion in the same period. Analysts project Broadcom to generate about $173.5 billion in fiscal 2027 revenue, trading at approximately 21.6 times estimated earnings compared to Marvell's 57.3 times. The analysis concludes that Broadcom offers a more attractive risk-reward proposition today due to its faster expected revenue growth combined with a much lower forward valuation than its competitor.