In an impressive move, chipmaker Broadcom has announced a 10% increase in its annual revenue forecast for chips used in artificial intelligence (AI) applications. The news has propelled its shares to surge by 12% in extended trading.

Broadcom, headquartered in Palo Alto, California, is a leading manufacturer of advanced networking chips crucial for processing vast amounts of data in AI technologies like OpenAI's ChatGPT. With businesses heavily investing in the booming AI industry, Broadcom stands as one of the beneficiaries.

According to their revised forecast, Broadcom expects to generate $11 billion in revenue from AI-linked chips by 2024, surpassing their previous projection of $10 billion. This increased optimism reflects the growing demand for AI capabilities across various sectors.

During the second quarter, Broadcom's revenue from AI products reached an impressive $3.1 billion. This further solidifies the company's position in the AI market and paves the way for future growth.

To capitalize on the rally in its shares this year, Broadcom has also announced a forward stock split. The 10-for-1 split is aimed at making the company's shares more affordable for retail investors. The split-adjusted trading is scheduled to commence on July 15, offering increased accessibility to a wider range of investors.

Broadcom's custom chips unit has been making notable strides, garnering orders from major cloud providers seeking alternatives to Nvidia's expensive processors. It is rumored that Google and Meta are among the companies that benefit from Broadcom's custom chip offerings.

The company's semiconductor solutions segment, housing its networking and custom chips, witnessed a 6% rise in revenue, reaching $7.20 billion in the quarter. Analyst Ben Bajarin from Creative Strategies believes that Broadcom stands as the second-biggest beneficiary, after Nvidia, in the transition towards AI servers within the data center market.

Furthermore, Broadcom's revenue from the infrastructure software segment more than doubled, primarily due to its acquisition of VMware. As a result, Broadcom has raised its full-year revenue forecast by an impressive $1 billion, now projecting $51 billion in annual revenue.

The company's enhanced performance has not stopped at revenue projections alone. Broadcom has also raised its annual core profit projections, surpassing LSEG estimates for second-quarter adjusted earnings per share and revenue.

With increased confidence in its AI-linked chips, a planned stock split to attract more investors, and an optimistic revenue forecast, Broadcom seems well-positioned for continued success in the evolving AI market.