Why Broadcom Stock Is Surging in Premarket: Alphabet’s AI Push Sparks Massive Rally

Broadcom Inc. shares are experiencing a significant rally, trading at $391.67 in premarket hours as of 9:06 AM EST on November 25, 2025, representing a 3.63% gain following Monday’s remarkable 11.10% surge that closed at $377.96. The semiconductor giant has emerged as one of the top beneficiaries of the artificial intelligence boom, with its market capitalization reaching $1.785 trillion.

Wall Street analysts are increasingly viewing Broadcom as a derivative play on Alphabet’s expanding AI dominance, driven by the chipmaker’s critical role in designing and manufacturing Google’s tensor processing units (TPUs).

Google’s Growing TPU Demand Continues to Lift Broadcom’s AI Business

Broadcom’s surge is directly tied to its relationship with Google-parent Alphabet, which rose more than 5% as the AI trade regained momentum. The connection centers on high-performance, application-specific chips (ASICs), where Broadcom serves as one of the biggest suppliers to hyperscalers.

Google is a major customer of Broadcom’s ASIC business, with Broadcom helping design and manufacture Google’s specialized AI chips used for the company’s internal AI infrastructure. Google TPUs are considered competitors to Nvidia’s graphics processing units for AI workloads.

The partnership between Google and Broadcom dates back to 2016 and is now in its seventh generation of development. Melius Research analyst Ben Reitzes noted that outside of Nvidia GPUs for AI workloads, the TPU has become the most proven ASIC available.

The decision to develop this product early is now starting to inflect upward, delivering benefits for both Broadcom’s AI revenues and Google Cloud growth. Reitzes raised his price target to $475, suggesting 39.6% potential upside, emphasizing that while the relationship is beneficial for Alphabet, it may prove even better for Broadcom.

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Wall Street analysts are increasingly bullish on Broadcom’s AI prospects. Jefferies analyst Blayne Curtis, who maintains the highest price target of $480 among analysts, named Broadcom a top pick and stated that ASICs are hitting an inflection point as Google’s need for custom chips continues to grow.

Curtis highlighted that Google’s token processing volumes increased from 480 trillion in April 2025 to 1,300 trillion in October 2025, with expectations for further growth as compute requirements expand for multimodal models.

Dan Ives of Wedbush Securities described Broadcom and Alphabet as the new AI plays the market is rediscovering, calling the ASIC chip opportunity massive with Google leading the charge. The analyst emphasized that this could be the most proven ASIC chip in the market and that the AI Revolution remains in its early days.

With Broadcom posting year-to-date returns of 64.19% compared to the S&P 500’s 14.00%, and one-year returns of 132.40%, the company has demonstrated exceptional performance. Its strong fundamentals include a profit margin of 31.59%, revenue of $59.93 billion, and levered free cash flow of $23.1 billion.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.