Broadcom
Broadcom Inc. is an American multinational designer, developer, manufacturer and supplier of semiconductor and infrastructure software products. Its products serve the data centre, networking, software, broadband, wireless, storage and industrial markets. As of 2026 it is among the largest companies in the world by market capitalisation.
| Broadcom Inc. | |
|---|---|
| Type | Public |
| Traded as | Nasdaq: AVGO |
| Industry | Semiconductors, infrastructure software |
| Founded | 1961 as HP Associates; Avago Technologies 2005; present name 2018 |
| Headquarters | Palo Alto, California, United States |
| Area served | Worldwide |
| Key people | Tan Hock Eng (president and CEO) |
| Products | Networking and switching silicon, wireless and broadband chips, storage controllers, custom AI accelerators |
| Services | VMware virtualisation, Symantec enterprise security, CA mainframe and BizOps software |
| Revenue | US$35.8 billion (fiscal 2023) |
| Subsidiaries | VMware, Symantec Enterprise Security, CA Technologies, Broadcom Corporation |
| Website | broadcom.com |
In December 2024 Broadcom became the twelfth company to pass a one trillion dollar market capitalisation, and in April 2026 the sixth in history to pass two trillion dollars. As of 2025 approximately 58 per cent of revenue came from semiconductor products and 42 per cent from infrastructure software and services. Tan Hock Eng is president and chief executive, and the company is headquartered in Palo Alto, California.
Broadcom is unusual among large technology companies in that it is primarily an acquirer rather than an inventor. Its strategy, executed consistently by Tan since 2006, is to buy businesses holding durable, hard-to-displace positions in infrastructure, reduce their costs sharply, concentrate sales on the largest customers and raise prices. The approach has produced one of the highest operating margins in the industry and exceptional shareholder returns, and it has made the company the most frequent subject of customer and regulatory complaint in enterprise technology.
Corporate identity
The present company's name and legal identity are the result of a sequence of transactions that separated them from their origins. Avago Technologies Limited renamed itself Broadcom in order to acquire Broadcom Corporation in January 2016, retaining Avago's ticker symbol AVGO while the Broadcom Corporation symbol BRCM was retired. The merged entity was initially Broadcom Limited, becoming Broadcom Inc. in November 2017. The original Broadcom Corporation, founded in 1991 by Henry Samueli and Henry Nicholas, remains a wholly owned subsidiary.
History
Origin within Hewlett-Packard
The business that became Broadcom Inc. was established in 1961 as HP Associates, the semiconductor products division of Hewlett-Packard. It separated from Hewlett-Packard as part of the Agilent Technologies spin-off in 1999, carrying with it a portfolio of optoelectronics, radio frequency and fibre optic component technologies developed over four decades.
Avago Technologies
KKR and Silver Lake Partners acquired the Semiconductor Products Group of Agilent Technologies in 2005 for 2.6 billion dollars, forming Avago Technologies. The private equity ownership shaped the company that followed: the discipline applied to a slow-growing division of a large corporation established the operating model Tan would later apply at far greater scale.
Avago agreed to sell its input/output solutions unit to PMC-Sierra for 42.5 million dollars in October 2005. It filed for a 400 million dollar initial public offering in August 2008, acquired the Munich-based bulk acoustic wave business of Infineon Technologies for 21.5 million euros in October 2008, and went public on the Nasdaq under the symbol AVGO on 6 August 2009.
The acquisition programme then accelerated. Avago agreed to buy the optical chip and component supplier CyOptics for 400 million dollars in April 2013, expanding its fibre optics range, and invested five million dollars in the power electronics company Amantys that October.
In December 2013 it agreed to acquire LSI Corporation for 6.6 billion dollars, a transaction that moved the company away from specialised components toward mainstream products, particularly data centre storage silicon. It sold LSI's solid state drive controller business to Seagate Technology in May 2014 and its Axxia networking business to Intel for 650 million dollars, agreed to buy the integrated circuit designer PLX Technology for 309 million dollars, and in February 2015 agreed to acquire Emulex Corporation at eight dollars a share in cash. By August 2014 it was the ninth largest semiconductor company in the world.
The pattern established here has been repeated since: acquire a larger business, retain the parts with defensible market positions and high margins, and divest the remainder promptly.
Acquisition of Broadcom Corporation
On 28 May 2015 Avago announced that it would buy Broadcom Corporation for 37 billion dollars, 17 billion in cash and 20 billion in shares. Avago was the nominal survivor but the combined company took the Broadcom name, with annual revenue of 15 billion dollars and a market value of 77 billion dollars.
The acquisition substantially strengthened the company's patent position in mobile, data centre and Internet of Things technologies, making it the ninth largest patent holder among leading semiconductor vendors according to an analysis by the consultancy LexInnova.
Consistent with the model, non-core assets were sold promptly. In May 2016 Cypress Semiconductor acquired Broadcom Corporation's entire Internet of Things portfolio for 550 million dollars, including intellectual property for Wi-Fi, Bluetooth and Zigbee connectivity and the WICED developer platform.
Foreign investment review and the Qualcomm bid
In 2016 Broadcom proposed to acquire Brocade Communications Systems for 5.5 billion dollars in cash. The transaction was delayed for review by the Committee on Foreign Investment in the United States because the company was then domiciled in Singapore. On 2 November 2017 Broadcom announced that it would move its legal address from Singapore to Delaware, removing the basis for the review, and the parent was renamed from Broadcom Limited to Broadcom Inc.
In mid-November 2017 Broadcom proposed to purchase Qualcomm for 130 billion dollars. Qualcomm's board rejected the offer, and the hostile bid, later revised to 117 billion dollars, would have been the largest technology acquisition ever attempted.
President Donald Trump blocked it by executive order citing national security. The Committee on Foreign Investment in the United States held that Broadcom, then headquartered in Singapore, was too close to China and to Huawei, and stated that a shift to Chinese dominance in 5G would have substantial negative national security consequences for the United States, and that while the United States remained dominant in standards setting, China would likely compete robustly to fill any void left by Qualcomm. The specific concern was that Broadcom's practice of reducing research spending at acquired companies would weaken American participation in 5G standards development at a decisive moment.
Critics argued that the decision was motivated more by industrial competitiveness than by security, and observers noted that it was as consistent with the administration's trade objectives as with its stated security rationale. Broadcom withdrew two days after the order.
Expansion into software
The failure of the Qualcomm bid led Tan to seek growth in infrastructure software instead, a category with the same characteristics he sought in silicon: entrenched products that customers find costly and risky to replace.
On 11 July 2018 Broadcom agreed to acquire CA Technologies, formerly Computer Associates, for 18.9 billion dollars, completing on 5 November. CA was a long-established supplier of mainframe software that had extended into cloud tools. The purchase was received poorly by investors, who saw no connection between semiconductors and mainframe software, and the share price fell sharply on announcement.
On 9 August 2019 Broadcom acquired the enterprise security business of Symantec for 10.7 billion dollars in cash, together with the Symantec name and brand, completing on 4 November. The consumer portion of Symantec, retained by the seller, became NortonLifeLock and subsequently Gen Digital.
Broadcom was the fifth best performing stock of the 2010s, returning 1,956 per cent over the decade.
VMware
In May 2022 Broadcom announced an agreement to acquire the virtualisation and cloud computing company VMware for 61 billion dollars in cash and stock, assuming eight billion dollars of VMware debt, a transaction ultimately valued at 69 billion dollars.
Regulatory review was extensive. The United Kingdom Competition and Markets Authority announced an investigation in November 2022 into whether the acquisition would substantially lessen competition in any United Kingdom market, and the European Commission opened its own inquiry. The completion date was extended repeatedly, from May 2023 to August and then to November.
China was the final regulator to approve, doing so with conditions requiring that VMware server software remain compatible with local hardware and that customers not be restricted to Broadcom hardware. The transaction closed on 22 November 2023. On completion Tan announced that the company would move its headquarters from San Jose to the VMware campus in Palo Alto. In February 2024 Broadcom sold VMware's end-user computing division to KKR for four billion dollars.
Recent developments
On 7 January 2020 Accenture agreed to acquire Symantec's 300-person cybersecurity services division. In February 2020 Broadcom announced the BCM4389, described as the world's first Wi-Fi 6E client device, and in the same year Raspberry Pi adopted the Broadcom BCM2711 for its new boards.
In July 2026 Broadcom announced that it had extended its partnership with Apple through 2031 to develop and supply custom semiconductor products, adding to its existing supply of radio frequency, Wi-Fi, Bluetooth and networking components for Apple devices.
Business model
Broadcom's approach under Tan is distinctive enough to have become a subject of study in its own right. The company identifies businesses supplying products that are deeply embedded in customer infrastructure and expensive to replace, acquires them, and then applies a consistent set of measures: substantial reduction of headcount and of research spending on products outside the core, discontinuation of smaller product lines, concentration of the sales effort on the several hundred largest customers, migration of remaining customers to resellers, and significant price increases at contract renewal.
The financial results have been exceptional, with operating margins far above semiconductor industry norms and a share price return that placed the company among the best performing large stocks of two successive decades.
The criticism is equally consistent. Customers of acquired companies report large price increases, reduced support, the bundling of products they do not want and the withdrawal of perpetual licences in favour of subscriptions. Competition authorities in the United States and Europe have acted against the contractual arrangements used to protect these positions. The defence offered by Broadcom is that acquired businesses were underinvesting in their most important products while dissipating resources across unprofitable lines, and that its pricing reflects the value customers actually derive.
Products
Broadcom supplies semiconductors and infrastructure software across data centre, networking, broadband, wireless, storage and industrial markets. Applications include data centre networking, home connectivity, broadband access, telecommunications equipment, smartphones, base stations, servers and storage, factory automation, power generation and alternative energy systems, displays, and mainframe operation and management.
Networking silicon
Ethernet switching silicon is the company's most strategically important product line. The Tomahawk series serves hyperscale cloud networks with high-density standards-based switching. Tomahawk 3 shipped in two variants, the first providing up to 12.8 terabits per second of chip bandwidth with 256 integrated SerDes supporting 32 ports at 400 gigabits, 64 at 200 gigabits or 128 at 100 gigabits, and the second offering eight terabits per second using 160 of those SerDes. Tomahawk 4 reached 25.6 terabits per second and Tomahawk 5 reaches 51.2 terabits per second.
The Jericho series serves routing applications, Jericho2 offering up to ten terabits per second of switching capacity per device with deep buffering suited to carrier and artificial intelligence cluster networks.
Because large artificial intelligence training clusters are limited as much by the network connecting accelerators as by the accelerators themselves, this product line has become central to the company's growth.
Custom accelerators
Broadcom uses the term XPU for custom application-specific integrated circuits developed with hyperscale customers including Google, Meta Platforms and ByteDance for specialised artificial intelligence workloads.
It has co-developed Google's Tensor Processing Unit across every generation since the programme began, translating Google's architecture and specifications into manufacturable silicon, supplying proprietary technologies including high-speed SerDes interfaces, overseeing the design and managing fabrication and packaging through third-party foundries such as TSMC. Meta's Training and Inference Accelerator chips, introduced in 2023, were co-developed in the same way. In 2024 Broadcom began working with OpenAI on a custom inference chip, part of a wider effort by large model developers to reduce dependence on Nvidia graphics processors.
This business has made Broadcom the principal alternative route to large-scale artificial intelligence compute, and the announcement of new custom silicon customers has repeatedly moved its share price substantially.
Other semiconductors
Core franchises include optical components, network interface controllers, data storage controllers and radio frequency front-end modules for smartphones, the last a substantial business in which Apple is the dominant customer. Network interface controllers made by Broadcom are used in Dell PowerEdge blade servers, and by Apple, Hewlett Packard Enterprise and Raspberry Pi among others.
Software
Broadcom operates its enterprise security business under the Symantec brand, acquired in 2019. Its CA products cover mainframe management together with a set of tools for business operations, including Clarity for product portfolio management, Rally for agile development, Blaze CT for shift-left testing, DX Operational Intelligence for operations analytics and Agile Requirements Designer for model-based test optimisation. VMware supplies virtualisation and private cloud infrastructure and is now the largest single software asset.
Financial performance
For fiscal 2023 Broadcom reported earnings of 14.08 billion dollars on revenue of 35.8 billion dollars, an increase of 7.8 per cent over the previous year. Revenue has since grown substantially on the strength of custom artificial intelligence silicon and VMware subscription conversion, and the market capitalisation passed one trillion dollars in December 2024 and two trillion dollars in April 2026.
The financial profile is characteristic of the strategy: high margins, substantial free cash flow, considerable leverage used to fund acquisitions and then repaid quickly, and a research and development ratio below that of semiconductor companies pursuing organic growth.
Controversies
United States antitrust
In January 2018 it was reported that the Federal Trade Commission had been investigating Broadcom for several months over anticompetitive conduct in customer negotiations. In 2021 the company settled a complaint alleging that it had abused monopoly power through restrictive contract terms and threats of retaliation against customers it deemed disloyal, in markets for semiconductor components used in set-top boxes and broadband devices.
European Union antitrust
In October 2019 the European Commission issued an interim order requiring Broadcom to cease allegedly anticompetitive practices, an unusual measure reflecting the Commission's view that delay would cause irreversible harm. The competition commissioner Margrethe Vestager said that Broadcom's contract terms with six principal customers would create serious and irreversible harm to competition if no action were taken.
Broadcom subsequently committed to suspend agreements containing exclusivity or quasi-exclusivity arrangements and not to enter into such agreements for seven years.
VMware licensing
The changes made to VMware after the 2023 acquisition produced the most widespread customer objection in the company's history. Broadcom ended perpetual licensing in favour of subscriptions, consolidated more than 8,000 stock-keeping units into a small number of bundles, raised minimum core counts and terminated much of the partner programme.
In March 2026 the trade group Cloud Infrastructure Service Providers in Europe filed a formal complaint with the European Commission alleging that Broadcom's licensing of VMware products to cloud service providers infringed European competition rules, and requesting interim measures to halt the closure of VMware's cloud service provider programme. The group alleged that prices had risen tenfold since the acquisition, with payment demanded in advance and products bundled regardless of customer need. The Commission confirmed that it was assessing the complaint. Broadcom denied the allegations, describing the group as an organisation funded by hyperscalers which misrepresented the realities of the market.
Separately, Broadcom's decision to audit customers for licence compliance and to pursue those who had continued using perpetual licences after support expiry generated litigation and regulatory complaints in several jurisdictions.
Patent litigation
In 2017 Broadcom filed patent actions against smart television manufacturers; the United States International Trade Commission ruled in favour of the manufacturers.
In 2020 Broadcom sued Netflix over multiple alleged patent infringements. Critics argued that the company was pursuing Netflix because of its success, noting that the decline of traditional pay television subscriptions was reducing demand for the set-top box silicon from which Broadcom earned substantial revenue. The Leichtman Research Group calculated that the largest American pay television providers, representing about 95 per cent of the market, lost approximately 4,915,000 net video subscribers in 2019, and that customers each paid about 231 dollars a year for equipment, amounting to nearly 20 billion dollars of annual profit for the cable industry.
Wi-Fi security vulnerabilities
In April 2017 Google's Project Zero examined Broadcom's system-on-chip Wi-Fi stack and found that it lacked all basic exploit mitigations, including stack cookies, safe unlinking and access permission protection, permitting full device takeover by Wi-Fi proximity alone with no user interaction. Numerous smartphones from Apple, Samsung and Google were affected. The findings prompted substantial changes to the firmware's security architecture and were widely cited as evidence that the security of wireless firmware had not kept pace with that of operating systems.
Research spending
The most substantive criticism of Broadcom's model concerns its effect on innovation. Acquired companies have generally seen research budgets cut, product roadmaps narrowed and engineering staff reduced. The Committee on Foreign Investment relied on precisely this pattern in blocking the Qualcomm bid. Broadcom's position is that it redirects research toward the products customers actually depend on rather than spreading it across speculative lines, and it points to the Tomahawk and Jericho families and its custom accelerator work as evidence of sustained investment where it matters.
Leadership
Tan Hock Eng has been president and chief executive since 2006, first of Avago and then of the renamed company. Born in Penang, Malaysia, educated at MIT and Harvard Business School, he worked in finance and at Commodore International and Integrated Circuit Systems before joining Avago under its private equity owners.
His compensation has repeatedly ranked among the highest of any American chief executive, largely through performance share awards tied to total shareholder return, and has drawn objection from advisory firms and some institutional shareholders, though the awards have generally been approved given the returns delivered.
See also
References