UBS raises Broadcom’s 2027 TPU shipment forecast to 7 million units: AI compute demand is proving the $100 billion revenue story.
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The ongoing explosion in AI computing power demand is turning Broadcom's hundred-billion-dollar revenue blueprint from prediction into reality.
According to Chasing Wind Trading Desk, UBS released its latest research report on April 13, raising Broadcom’s 2027 TPU shipment forecast from about 6 million to about 7 million units, and simultaneously significantly increasing the company's revenue and profit forecasts for the next three years. The direct trigger for this adjustment is Broadcom's signing of a long-term cooperation agreement with Google, extended to 2031, and the latest progress in expanded cooperation among Broadcom, Google, and Anthropic.
Supported by the signing of the agreements and supply chain verification data, UBS has raised Broadcom's fiscal 2027 revenue forecast from $182.2 billion to $194.9 billion, an increase of about 7%; the fiscal 2028 revenue forecast was raised from $229.7 billion to $248.4 billion, an increase of about 8%. UBS also raised the fiscal 2027 AI revenue forecast to $145.5 billion, about a 10% increase from the previous $132.7 billion forecast, significantly exceeding the company’s official guidance. However, UBS noted that most investors have already expected the numbers to fall in this range.
Google Secures Demand Long-Term, GCP TPU Spending Prediction Jumps Sharply
Last week, Broadcom and Google announced the signing of a new long-term agreement covering multiple future generations of TPU products, with a supply guarantee for key network and rack-level components, extending the contract through 2031. UBS believes this move addresses, to some extent, market concerns that Google might shift to developing its own chips (COT)—especially under the background that MediaTek began mass production of TPUs this year. However, UBS notes that most investors it has spoken with still believe Google will rely heavily on Broadcom within this timeframe.
Based on a judgment of continued strong GCP demand and signs that some hyperscale cloud vendors are using GCP TPU computing power more and more for training, UBS has significantly raised its GCP TPU spending predictions: $26.6 billion/$61.3 billion/$78.8 billion for 2026/2027/2028 respectively, compared to previous forecasts of $26.0 billion/$46.0 billion/$61.0 billion. The 2027 forecast increase is particularly significant, up about 33% from the previous estimate.
Breaking down by TPU shipment, UBS expects Broadcom to ship about 7.32 million TPUs in 2027, mainly driven by two products: v7 (Ironwood, N3 process) and v8ax (Sunfish, N3 process), with expected shipments of 4.05 million and 3.27 million respectively.
Anthropic Expands Partnership, Related TPU Order Size Approaches $50 Billion
Disclosed alongside the Google agreement is the expanded three-way partnership among Broadcom, Google, and Anthropic. Under this framework, Anthropic will access roughly 3.5GW of TPU computing power from 2027 on, provided its commercial operations continue to succeed.
In terms of revenue, UBS has therefore raised the anticipated order size for Anthropic-related TPUs from around $40 billion (covering 2026–2027) to nearly $50 billion, which is roughly consistent with the $53 billion Anthropic revenue projected in UBS’s model. Specifically, UBS expects Anthropic's TPU rack orders to reach $25 billion in 2026 and $28 billion in 2027.
Business data released by Anthropic at the same time also confirms strong momentum in computing power demand: its annualized revenue run rate (ARR) has exceeded $30 billion, surging from about $9 billion at the end of 2025; the number of customers with annual contract value over $1 million has surpassed 1,000—double from about 500 in February. Anthropic also stated that all additional TPU computing power associated with this expansion will be deployed in the U.S., representing a major acceleration of its previous $50 billion U.S. AI infrastructure commitment.
Revenue Forecasts Raised Across the Board, AI Business Becomes the Core Driver
UBS has comprehensively revised its estimates for Broadcom. The fiscal 2026 revenue forecast remains unchanged at $109 billion; the fiscal 2027 revenue is raised from $182.2 billion to $194.9 billion, with year-over-year growth expectations up from 67% to 79%; the fiscal 2028 revenue is raised from $229.7 billion to $248.4 billion.
For earnings per share (EPS), fiscal 2026 holds at $12.16, fiscal 2027 is raised 7% from $21.14 to $22.56, and fiscal 2028 is increased from $26.83 to $28.59, up 7%. Free cash flow forecasts are raised from $97 billion to $102.1 billion for 2027, and from $132.3 billion to $141.2 billion for 2028.
By business segment, AI revenue is the main source of the increase. UBS predicts Broadcom’s Custom Compute revenue will reach $101.6 billion in 2027, up about 14% from the previous $89.3 billion; AI networking revenue is forecast at $43.9 billion, roughly unchanged. The overall semiconductor solution business revenue forecast for fiscal 2027 is raised from $152 billion to $164.7 billion.
In terms of valuation, UBS uses the sum-of-the-parts (SOTP) method, applying a multiple of about 12x EV/FCF for Broadcom’s 2027 software free cash flow contribution ($42 billion), and about 26x EV/FCF for the semiconductor free cash flow contribution ($72.6 billion), resulting in a target price of $475, unchanged from before.
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