While chip stocks have had a rough time in 2025, often being caught in the crossfire of global trade disputes, their importance in the artificial intelligence (AI) revolution is impossible to ignore. As AI continues to transform everything from cloud computing to autonomous vehicles, the demand for powerful, specialized chips is skyrocketing. This surge is pushing semiconductor innovation to the forefront of the digital economy. 

Having said that, although chip giant Nvidia (NVDA) might still be the AI darling, Broadcom (AVGO) plays an equally vital role, albeit one that’s often overlooked. The company’s application-specific integrated circuits (ASICs) form the backbone of AI data center infrastructure, powering the custom processors used by tech giants such as Alphabet (GOOGL) and Meta (META). Broadcom’s role in enabling these AI workloads is essential, even if it doesn’t always make headlines.

In fact, analysts at Redburn Atlantic recently took a bullish view on the company, highlighting this very point, noting that Broadcom’s strong ASIC pipeline isn’t receiving the recognition it deserves. Thus, keeping these factors in mind, let’s take a closer look at a key AI chip leader whose quiet dominance often goes unnoticed.

About Broadcom Stock

Palo Alto-based Broadcom (AVGO) is a global technology company with a diverse portfolio across semiconductors, enterprise software, and security. Its products support essential sectors, including cloud computing, data centers, networking, wireless communications, and cybersecurity. With solutions embedded in everything from mobile devices to hybrid cloud systems, Broadcom plays a central role in powering today’s digital infrastructure.

With a towering market cap of $1.2 trillion, this chip giant has held its ground in 2025 despite broader market headwinds. On a YTD basis, the stock has climbed roughly 10%, outpacing the marginal gains of the S&P 500 Index ($SPX). However, the real momentum has emerged more recently, with shares surging 25% in just the past month alone. Looking over the past year, the stock’s performance stands out even more, delivering a stellar 92.8% return, far eclipsing the broader market.

Broadcom’s Q1 Earnings Snapshot

Broadcom shares soared over 8% following its strong fiscal 2025 first quarter earnings report released on March 6. The company delivered total revenue of $14.9 billion, edging past analyst expectations and marking an impressive 25% year-over-year increase. Even more striking was its adjusted earnings per share, which jumped 45.5% to $1.60, easily beating Wall Street’s forecast of $1.51. 

At the heart of Broadcom’s explosive growth is its booming AI business, which played a major role in the stock’s impressive performance last year. As a key supplier of AI data center infrastructure, Broadcom not only collaborates on custom AI chips for Google, but also provides the critical networking gear that links thousands of chips together to power advanced AI systems. 

In the first quarter alone, Broadcom pulled in $4.1 billion in AI-related revenue, a staggering 77% jump year over year. These gains helped drive its semiconductor solutions segment to $8.2 billion, up 11% from the previous year. “We expect continued strength in AI semiconductor revenue of $4.4 billion in Q2, as hyperscale partners continue to invest in AI XPUs and connectivity solutions for AI data centers,” noted CEO Hock Tan. 

Looking ahead to its second-quarter report, set for release after the bell on June 5, Broadcom expects revenue to hit approximately $14.9 billion, while adjusted EBITDA is anticipated to be 66% of that projected figure, underscoring the company’s continued operating strength.

What Do Analysts Expect for Broadcom Stock?

Recently, Redburn Atlantic initiated coverage on Broadcom, highlighting its strong position in AI data center infrastructure and its standout role in the booming ASIC market amid cautious investor sentiment surrounding Generative AI. 

Analyst Mike Harrison is bullish on Broadcom, emphasizing ASICs’ critical importance as major tech companies and hyperscalers prioritize capital-efficient investments. He describes Broadcom as the “pre-eminent ASICs co-partner” with a strong pipeline of future customers and active involvement in multiple GenAI silicon programs, including collaborations with Meta, Apple (AAPL), and OpenAI.

In fact, Harrison noted that the market consensus is not giving Broadcom enough credit for the strength and potential of its ASIC business, suggesting there is significant room for growth. Reflecting this optimism, Redburn assigned a “Buy” rating and set a price target of $301 for AVGO, implying potential upside of approximately 18% from current levels.

Overall, analysts are rallying behind AVGO, with Wall Street firmly leaning toward a bullish “Strong Buy” consensus. Of the 33 analysts offering recommendations, 29 give it a solid “Strong Buy,” one suggests a “Moderate Buy,” and the remaining three give a “Hold.” The average analyst price target of $249.37 is below the current trading price.