Analysts at Oppenheimer met with Broadcom (NASDAQ:AVGO) CEO Hock Tan, President Charlie Kawwas, CFO Kirsten Spears, and Director of IR Ji Yoo on Thursday and maintained their bullish stance on the stock.
The investment firm said the tone of the meeting was upbeat following the company's solid beat and raise on Wednesday. Management reportedly highlighted its VMware strategy and custom ASIC opportunity.
Outperform-rated AVGO "secured next-gen custom ASIC design wins for two of three hyperscale customers," analysts believe, including TPUv7.
"AVGO's durable custom ASIC leadership stems from breadth of semi IP cores, incumbency with major CSP platform, and specialized knowledge/expertise developed over the past decade-plus," the firm said. "MRVL [is] likely the only credible competitor, in our view, for large-scale CSP custom compute projects."
Analysts also noted that Broadcom management sees a custom ASIC opportunity geared toward internal CSP workloads vs. the public cloud.
In addition, AVGO is said to be on track to deliver CPO PoCs to two CSPs this summer, with management seeing CPO power savings of ~50% as a primary motivator and ~40% cost savings as a secondary benefit.