Broadcom CEO Hock Tan told CNBC that the company raised its AI revenue guidance because big enterprises are heavily investing in AI products. He said these 'hyperscalers' have a strong incentive to build smarter and smarter large language models, which require more compute power each time. Tan believes this need for semiconductors is not a one-year phenomenon but a 'very urgent journey' for Big Tech.
In a Monday interview with CNBC's Jim Cramer, Broadcom CEO Hock Tan detailed why the semiconductor company hiked up its guidance for artificial intelligence revenue during its earnings report earlier this month, saying huge enterprises are invested in the products.
"We are in a segment of the market in AI where we are addressing several hyperscalers," he said."And these hyperscalers have very strong incentive, ambition to towards building continually, investing in large language models to basically create models that are smarter and smarter.
"We are in a segment of the market in AI where we are addressing several hyperscalers," he said."And these hyperscalers have very strong incentive, ambition to towards building continually, investing in large language models to basically create models that are smarter and smarter."for revenue and earnings, and it guided for $12 billion in AI sales for fiscal 2024, up from a previous estimate of $11 billion.
According to Tan, the AI boom is far from over, as some investors fear. Megacap tech companies will continue to need Broadcom's technology, he said, because each newer, smarter generation of large language model will require more and more"compute" each time. He said the need for these semiconductors is not a"one-year phenomenon," but a"very urgent journey" for Big Tech.
AI Broadcom Hock Tan Semiconductors Hyperscalers
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