Broadcom Inc. (NASDAQ:AVGO) could be one of the biggest beneficiaries of Anthropic’s accelerating compute requirements. The opportunity comes amid growing concerns that Google’s decision to develop more of its chips internally could threaten Broadcom’s custom silicon business.
However, Macquarie analyst Arthur Lai argued on September 3 that many of these concerns may already be priced in. The stock is down by about 24% from its all-time high, while Google’s work with MediaTek and its expanding relationship with Marvell have added to concerns about Broadcom losing share in future TPU programs.
According to Lai, the recent weakness could create an attractive entry point as Broadcom positions itself to capture what could become a $40 billion opportunity from Anthropic.
In April, Anthropic announced an expanded partnership with Google and Broadcom to secure next-generation TPU capacity. Anthropic plans to use its computing infrastructure to accelerate training and inference for its Claude family of artificial intelligence models as demand for AI applications continues to grow.
The partnership could provide Broadcom with an important avenue for expanding its custom AI semiconductor business. The company has also been expanding its AI infrastructure capabilities through partnerships with major financial institutions. Together with Apollo and Blackstone, it launched an AI XPV platform designed to support more than 20 gigawatts of compute capacity.
Anthropic’s rapidly increasing compute requirements could therefore create a substantial opportunity for custom XPU technology. Beyond AI accelerators, it could also benefit from growing demand for high-speed Ethernet networking needed to connect increasingly large AI clusters.
AI Revenue Highlights Broadcom’s Opportunity
Broadcom Inc.’s latest results underscore the scale of the AI opportunity. AI semiconductor revenue surged 221% year over year to $16.7 billion in fiscal third-quarter 2026, highlighting the rapid expansion of demand for the company’s AI-related products.
Management expects AI semiconductor revenue to reach approximately $115 billion in fiscal 2027 and potentially $230 billion in fiscal 2028. These projections demonstrate why securing major AI customers could become increasingly important to the long-term growth story.
The Anthropic relationship could provide additional revenue visibility while strengthening its position in custom AI silicon and networking. It could also help diversify the company’s exposure beyond traditional semiconductor markets as hyperscalers and AI laboratories increasingly seek customized computing solutions.
Risks to Consider
Despite the attractive opportunity, the Anthropic relationship also introduces several risks.
If Anthropic becomes one of the largest custom-chip customers, customer concentration could become a greater concern. Large contracts provide substantial revenue visibility, but they also increase exposure to the spending decisions of a relatively small number of customers.
Another risk is that Anthropic’s infrastructure spending ultimately depends on the commercial success of its AI models. If demand for Claude or other AI applications fails to grow quickly enough to justify massive infrastructure investments, Anthropic could slow its compute expansion.
Broadcom also faces increasing competition in custom AI silicon. Hyperscalers such as Google, Amazon and Microsoft continue to invest heavily in internally developed chips, potentially reducing their reliance on external suppliers over time.
Consequently, while the partnership could represent a significant growth catalyst, investors should not assume that every dollar of planned AI infrastructure spending will automatically translate into long-term revenue for AVGO.
Hedge Fund Analysis and Short Interest
Institutional positioning remains supportive of Broadcom Inc.’s long-term investment thesis. The number of hedge funds holding positions in the company stood at 170 at the end of the second quarter, down slightly from 173 in the first quarter.
Among major institutional investors, Fisher Asset Management increased its position by 3% to approximately $5.7 billion, while Arrowstreet Capital reduced its stake by 55% to about $3.25 billion.
The stock also has relatively limited bearish positioning. Short interest stood at approximately 1.20% of the public float, with about 56.21 million shares sold short. The relatively low short interest suggests that investors are not positioning heavily for a sustained decline in the stock.
The Verdict
Broadcom Inc.’s expanding relationship with Anthropic could strengthen its position as one of the key beneficiaries of the AI infrastructure spending boom. The combination of custom AI accelerators, networking technology and rapidly expanding compute requirements gives the company multiple avenues to capitalize on the next phase of AI infrastructure investment.
However, investors should also weigh customer concentration, hyperscaler efforts to develop chips internally, and the possibility that AI spending could eventually normalize.
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