Broadcom shares rose over 13% on Thursday (13 June) following a positive annual forecast fuelled by a huge demand for chips powering AI technology. 

The US chip manufacturer, that provides chips for Apple and other major tech companies, has benefited greatly from companies racing to develop AI products. 

As well as selling equipment for computing, Broadcom also sells components used in data centres which are vital in powering the emerging technology. 

Broadcom announced on Wednesday (12 June) that it was raising its annual revenue forecast derived from AI chips from $10bn to $11bn.

Broadcom’s $61bn acquisition of cloud company VMware also resulted in stronger results, according to Broadcom CEO Hock Tan. 

Tan predicted that total AI sales for fiscal 2024 will be over $11bn, while revenue from AI products reached a record $3.1bn in the second quarter. 

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“Broadcom’s second-quarter results were once again driven by AI demand and VMware,” Tan said in a statement. 

GlobalData forecasts that the overall AI market will be worth $909bn by 2030, having grown at a compound annual rate of 35% between 2022 and 2030.

In the GenAI space, revenues are expected to grow from $1.8bn in 2022, to $33bn in 2027, a CAGR of 80%. GenAI is expected to impact every industry and become a catalyst for broader AI capabilities such as machine learning and computer vision.