Broadcom and TSMC may surpass $1 trillion valuations

Broadcom and Taiwan Semiconductor Manufacturing, two major players in the technology market, are predicted to return to a $1 trillion market valuation by the end of 2025. Both companies currently stand at around $915 billion due to recent market challenges, but trends suggest they will recover. Broadcom is focusing on artificial intelligence (AI). The company produces hardware like custom AI accelerators, known as XPUs, and connectivity switches. XPUs are designed to improve efficiency in AI training tasks. Broadcom aims to scale its technology significantly, potentially creating AI clusters with nearly 1 million XPUs. This could greatly improve AI capabilities. The company’s AI revenue was about $12.2 billion in 2024, but there’s room for substantial growth, indicating a strong chance for Broadcom to exceed a $1 trillion value. Taiwan Semiconductor, or TSMC, plays a different but equally important role. As the world’s leading chip manufacturer, TSMC produces semiconductors for various companies, including those heavily involved in AI like Broadcom and Nvidia. The company expects a significant growth in its AI revenue, projecting a 45% compound annual growth rate over the next five years. TSMC is also developing new chip technologies that will be more efficient in terms of power consumption. Despite recent market pressures, TSMC shows healthy monthly revenue growth, with sales increasing by 36% in January and 43% in February. This strong performance signals that investor interest in the company will likely rise, helping it to rejoin the $1 trillion valuation club by the end of the year.