Broadcom (AVGO) Stock Jumps 3% as Google and Anthropic Deals Lock In Billions in AI Demand

TLDR

• Broadcom signed a long-term deal with Google to develop and supply custom AI chips through 2031.
• Broadcom also signed a deal giving Anthropic access to 3.5 gigawatts of AI computing capacity via Google’s TPUs, starting 2027.
• Anthropic’s annualised revenue has surpassed $30 billion, up from $9 billion at end of 2025.
• Analysts at Mizuho estimate Broadcom could earn $21 billion in AI revenue from Anthropic in 2026, rising to $42 billion in 2027.
• Anthropic said the deal is part of its commitment to invest $50 billion in U.S. computing infrastructure.

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Broadcom announced on Monday it has signed a long-term agreement with Google to develop and supply future generations of custom AI chips and related components through 2031. The deal covers next-generation AI rack systems and deepens a relationship that already includes Broadcom’s role in manufacturing Google’s tensor processing units, known as TPUs.

On the same day, Broadcom disclosed an expanded deal with Anthropic. The agreement gives the AI startup access to roughly 3.5 gigawatts of computing capacity built on Google’s TPU hardware, with that capacity set to come online starting in 2027.

Financial terms for both deals were not disclosed in the securities filing.

The timing follows comments from Broadcom CEO Hock Tan on last month’s earnings call. Tan said Broadcom was already providing Anthropic with around 1 gigawatt of compute from Google’s TPUs in 2026. He added that demand was expected to grow to more than 3 gigawatts by 2027.

Broadcom Inc., AVGO

Anthropic’s growth numbers back that up. The company said its run-rate revenue has now passed $30 billion annually, compared to roughly $9 billion at the end of 2025. It also said it now has over 1,000 business clients each spending more than $1 million per year — double the figure from just two months ago.

Analysts See Major Revenue Upside for Broadcom

Mizuho analysts led by Vijay Rakesh put numbers on what these deals could mean for Broadcom’s bottom line. Their estimate: $21 billion in AI revenue from Anthropic alone in 2026, climbing to $42 billion in 2027. Those figures are analyst projections, not confirmed contract values.

Anthropic said the new arrangement builds on its broader pledge to invest $50 billion in U.S. computing infrastructure. The company trains and runs its Claude model across a mix of hardware, including AWS Trainium, Google TPUs, and Nvidia GPUs. Amazon remains Anthropic’s primary cloud provider and training partner.

The Claude app saw a surge in public attention earlier this year when it briefly became the top free app in the U.S. Apple App Store in February, following a widely-reported dispute between Anthropic and the Pentagon.

Broadcom Also Working With OpenAI on Custom Chips

Broadcom is not limiting its custom silicon work to the Google-Anthropic side of the AI world. The company is also collaborating with OpenAI on custom chips.

OpenAI, for its part, has committed to using six gigawatts of AMD GPUs, with the first gigawatt expected in the second half of this year. Both OpenAI and Anthropic continue to rely heavily on Nvidia GPUs accessed through major cloud providers.

Broadcom’s after-hours gain of around 3% came directly after Monday’s announcement.

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