(Reuters) – Tech conglomerate Broadcom (NASDAQ:) raised its full-year revenue forecast on Wednesday, betting on rising demand for its networking equipment and specialty chips from companies investing in artificial intelligence infrastructure.
Shares of the Palo Alto, California-based company, which also announced a stock split, rose more than 9% in extended trading.
The company will implement a 10-for-1 forward stock split, which will take effect after markets close on July 12, with split-adjusted trading beginning on July 15.
Broadcom shares have risen more than 30% this year after nearly doubling in 2023 as investors bet big on chipmaker stocks expecting strong profits on the back of generative artificial intelligence technologies.
Broadcom makes advanced networking chips that help move massive amounts of data used by artificial intelligence applications like OpenAI’s ChatGPT, making it one of the biggest beneficiaries of tech giants’ increased spending.
Its custom chip division has also attracted orders from major cloud providers looking to reduce their dependence on expensive Nvidia (NASDAQ:) processors that are in short supply.
The company expects full-year revenue to be about $51 billion, including contributions from VMware (NYSE:), up from a previous forecast of $50 billion. Analysts on average expect fiscal 2024 revenue of $50.42 billion, according to LSEG.
Net revenue for the second quarter was $12.49 billion, compared with analysts’ estimates of $12.03 billion.