According to JPMorgan, the likely winner of this big chip deal from Google could see shares rise another 20% from here. Analyst Harlan Sur speculates that Broadcom recently won a contract with Alphabet for integrated circuit accelerator chips dedicated to next-generation AI applications or tensor processors that he expects to enhance in 2026 or 2027. “Equally important, we believe Broadcom’s custom chip (ASIC) business continues to see rapidly increasing orders from Google for advanced AI processing chips called TPUs and we believe the Google TPU program will bring in more than $8 billion in revenue for Broadcom this year… up 125% year-over-year, and more than $10 billion next year,” he wrote and noted. Note that this is the seventh AI processing chip version that the company will produce for Alphabet. Broadcom shares are up 25% this year, with Sur’s $1,700 target implying a 20% upside from Wednesday’s close. He noted that the company supplies chip designs to many popular technology names, including Microsoft, Apple and Meta Platforms, and is the second largest supplier of AI semiconductors after Nvidia and the market share leader. in the field of advanced chip design for customers. AVGO YTD Mountain Shares This Year Looking ahead, Sur expects Broadcom to benefit from its partnership with Meta Platforms as it gets ready to launch its third-generation accelerator chip later this year. Combined, these projects could deliver $11 billion to $12 billion in AI revenue by 2024 and $14 billion to $15 billion in revenue next year. “The company will be a big beneficiary of the trend toward more custom chip designs like the major cloud giants/[original equipment manufacturers] looking to drive more performance, power and cost differentiation along with their software framework,” he wrote.