Broadcom Inc. (AVGO) is tackling a problem many small businesses face: they want the control and predictable costs of a private cloud, but they don't have a team of IT specialists sitting around to build one.
On Tuesday, the tech giant announced it's expanding a support program that essentially lets smaller companies buy the expertise along with the software. Think of it as buying IKEA furniture that comes with someone to actually assemble it for you.
The initiative, which Broadcom tested successfully in the United States, is now rolling out to Europe, the Middle East, and Africa. TD Synnex Corp (SNX) is leading the international expansion, and Asia and other regions are up next.
Bundling Brains with Software
Here's how it works: Instead of buying cloud software and then scrambling to find consultants who know how to deploy it, businesses can now purchase everything in one package. The software comes bundled with professional technical support that guides customers through the entire migration process.
For smaller operations without dedicated cloud engineers, this removes a major barrier. You get the security benefits and cost predictability of running your own private infrastructure without needing to hire a specialized team or figure out the complexities yourself.
Broadcom is recruiting local partners in each region to deliver hands-on support, making the service more accessible globally. The goal is to democratize private cloud adoption for companies that have been priced out or intimidated by the technical demands.
Riding the AI Wave
While Broadcom expands its enterprise services, the company continues to benefit from the artificial intelligence boom. Broadcom stock has jumped 74% so far this year, fueled by surging demand for AI chips and data center infrastructure.
JP Morgan analyst Harlan Sur expects the company to exceed quarterly estimates when it reports results. He's projecting October-quarter revenue above $17.5 billion, with AI-related sales hitting between $6.5 billion and $6.7 billion. Much of that growth comes from Alphabet Inc. (GOOGL) ramping up production of Google's Tensor Processing Unit v6 and strong demand for Broadcom's Tomahawk 5 switches.
Looking ahead, Sur believes management will guide the January quarter above Wall Street expectations, with total revenue topping $19 billion and AI revenue approaching $8 billion. The analyst sees AI-related revenue reaching $20-21 billion for fiscal 2025 and potentially exceeding $50 billion by fiscal 2026 as new products scale up.
Beyond AI, Sur expects traditional chip markets to recover, VMware to deliver solid renewals and upselling opportunities, and free cash flow to grow at a double-digit pace. That cash generation should support both dividend payments and balance sheet improvements.
Stock Performance
Broadcom shares traded down 0.63% at $403.74 on Wednesday, hovering near the stock's 52-week high of $407.28. The company's momentum reflects both its AI exposure and its broader infrastructure business, which keeps expanding into new services like the private cloud support program.
The combination of hot AI demand and practical enterprise solutions positions Broadcom to capture growth from multiple angles—hyperscale data centers building AI infrastructure and smaller businesses looking for manageable cloud solutions.
