Broadcom (NASDAQ: AVGO) released its latest earnings, reporting revenue of $18.02 billion in Q4 FY2025 with a growth rate of 28%. Adjusted EPS rose by 37% to $1.95, exceeding expectations. The company expects total revenue of $19.1 billion next quarter, showing strong growth in AI semiconductor business and Infrastructure Software segment.

During the earnings call, Broadcom addressed its tensor processing units (TPUs) developed with Google, confirming Apple as an external customer. It added Anthropic as a fourth XPU customer with a $10 billion order, plus a fifth XPU customer with a $1 billion order. The company has a $10 billion backlog in AI switches, indicating strong demand.

Broadcom’s total AI backlog exceeds $73 billion, expected to convert to revenue in the next 18 months. The company anticipates more orders to come in, boosting actual AI revenue. Despite a decline in operating margins due to AI semiconductors, Broadcom’s massive growth in these products is expected to drive higher profits. Infrastructure Software growth may slow in FY2026.

With new XPU customers and strong revenue growth, Broadcom remains optimistic about its outlook. The company anticipates 100% AI semiconductor growth next quarter, surpassing previous expectations. Despite market reaction, Broadcom’s business is thriving, setting a positive trajectory for the stock.

Read more at Nasdaq: Broadcom Slips Post-Earnings Even as AI Demand Goes Parabolic