Thu Sep 19 07:30:07 UTC 2024: ## Broadcom Bets on AI’s Continued Growth, Predicts Hyperscale Cluster Boom
**SANTA CLARA, CA – October 27, 2024** – Broadcom CEO Hock Tan has predicted a continued boom in AI infrastructure development, with hyperscale customers building out massive AI clusters for the next three to five years.
Tan, speaking to CNBC’s Jim Cramer, explained that these clusters, used for developing advanced language models, will see a doubling in size with each generation, requiring a significant increase in compute power. He believes that this demand will be met by the rise of XPUs (AI acceleration silicon), a technology Broadcom sees as outperforming GPUs in the coming years.
“The AI clusters being built today use 100,000 accelerators, but future rigs will require a million,” Tan stated. Broadcom, eager to capitalize on this opportunity, is focused on designing custom AI silicon tailored for hyperscale customers.
Tan’s optimistic outlook comes at a time when the semiconductor market is recovering from a dip in early 2024. He anticipates a rebound in non-AI silicon sales in 2025 and 2026, fueled by strong demand from enterprises.
Broadcom’s strategy hinges on providing hyperscalers with alternative solutions to Nvidia’s dominance in the GPU market. With companies like Meta exploring custom AI silicon and Nvidia facing potential supply chain challenges, Broadcom sees a window for its XPUs to gain a foothold in the rapidly expanding AI hardware landscape.
The company is also pushing forward with its integration of VMware, aiming to transform the virtualization giant into a comprehensive platform that offers a fully virtualized data center experience.
While the timeframe for achieving this ambitious goal remains unclear, Tan’s predictions suggest that Broadcom is poised to benefit from the ongoing surge in AI development, particularly in the burgeoning hyperscale market.
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