Meta Platforms (META) is partnering with Broadcom (AVGO) on the design of custom artificial intelligence (AI) processors and accelerators.
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Forget margin or options. Here's how the pros trade AMZNThe deal, which runs through 2029, extends an existing partnership between Meta and Broadcom, and will provide Meta Platforms with custom in-house microchips used to power AI models and applications. Additionally, Meta said that Broadcom CEO Hock Tan will step down from Meta’s board of directors after two years of service.
Meta has committed to an initial deployment with Broadcom for one gigawatt of its Training and Inference accelerator chips, according to a joint statement by the companies. The deal will eventually see Meta deploy multiple gigawatts of microchips based on Broadcom’s proprietary technology.
Meta’s AI Push
“Meta is partnering with Broadcom across chip design, packaging, and networking to build out the massive computing foundation we need to deliver personal superintelligence to billions of people,” said Meta CEO Mark Zuckerberg in the statement.
Meta recently unveiled four new versions of its in-house microchips. It first unveiled custom chips in 2023, following on the heels of similar inhouse chip programs at rivals Google (GOOGL) and Amazon (AMZN). Technology giants such as Meta are seeking alternatives to costly microchips from Nvidia (NVDA), many of which are in short supply.
Is META Stock a Buy?
The stock of Meta Platforms has a consensus Strong Buy rating among 45 Wall Street analysts. That rating is based on 39 Buy and six Hold recommendations issued in the last three months. The average META price target of $856.08 implies 35% upside from current levels.
