Broadcom is one of the clearest 'pick and shovel' beneficiaries of AGI, supplying the custom silicon and networking hardware that AGI systems require to function, with only modest risk to its enterprise software segment.
Broadcom is a global technology company that designs, develops, and supplies semiconductor and infrastructure software solutions. Following its $69 billion acquisition of VMware in 2023, the company now operates two major divisions: a semiconductor solutions segment focused on networking, broadband, wireless, storage, and industrial chips, and an infrastructure software segment anchored by VMware's virtualization and cloud management products along with legacy CA Technologies and Symantec enterprise security software. Broadcom is a critical supplier of custom AI accelerators (XPUs) and networking chips to hyperscale cloud providers.
Broadcom's semiconductor customers include hyperscale cloud providers (Google, Meta, Amazon), enterprise data center operators, telecom/broadband service providers, and smartphone OEMs (notably Apple for Wi-Fi/Bluetooth chips). Its software customers are large enterprises, financial institutions, government agencies, and cloud service providers running VMware virtualization, CA mainframe software, and Symantec security products.
AGI cannot replace physical semiconductor chips or networking hardware. Broadcom's core products -- custom ASICs, networking switches, storage controllers, and broadband chips -- are physical goods that AGI systems themselves depend on. In fact, Broadcom is a major designer of custom AI accelerators (TPUs for Google, custom chips for other hyperscalers). On the software side, Broadcom's VMware acquisition makes it a major virtualization/infrastructure software provider; AGI could theoretically simplify infrastructure management, but the underlying virtualization layer remains necessary. Broadcom's customers are hyperscalers (Google, Meta, Microsoft), enterprise IT departments, telecom operators, and data center operators. Most of these are either building AGI (hyperscalers) or are infrastructure providers whose physical networks remain essential. Enterprise IT customers could consolidate or reduce complexity with AGI, potentially reducing demand for some networking/storage products. However, AGI workloads themselves are massive consumers of networking bandwidth, custom silicon, and data center infrastructure -- directly benefiting Broadcom.