AI revenue targets haven't changed
Broadcom CEO Hock Tan reaffirmed the company's long-term AI revenue targets despite investor concerns regarding a potential slowdown in frontier AI model development. Tan emphasized that demand for compute infrastructure remains strong and durable, specifically highlighting Anthropic as a key future customer.
Why it matters
Broadcom's outlook serves as a bellwether for the broader semiconductor industry and investor confidence in the sustainability of the AI infrastructure boom.
Broadcom CEO Hock Tan on Monday brushed off concerns about what a potential slowdown in frontier AI model development could mean for the chipmaker's business, telling CNBC that the company stands by its long-term revenue targets.
Tan's comments came as investors were rattled by Anthropic CEO Dario Amodei's weekend essay advocating for a moderation in the pace of model development. Amodei's message, which received support from OpenAI CEO Sam Altman and Elon Musk, prompted investors in AI infrastructure providers to reconsider their expectations for compute demand during Monday's session.
Shares of Broadcom — whose custom-chip business counts Anthropic as one of its most important customers — fell 4.8%. A broad basket of chip stocks, the iShares Semiconductor ETF, fell 5.6%. The stocks of companies selling other data-center components were also hit hard.
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