Broadcom $AVGO ( ▲ 11.1% ) is ripping higher after Google’s $GOOGL ( ▲ 6.31% ) new Gemini 3 model earned rave reviews that are spilling over to one of its key hardware partners. Think of it like the Air Jordan effect. When people watched Michael Jordan fly, they wanted the shoes. When people see Gemini 3 impress the AI world, they want the chips that made it possible.
Gemini 3 was trained on Google’s homegrown TPU chips that were codesigned with Broadcom. That connection has investors assuming Google will need a lot more custom silicon as it ramps up training and inference for future models. Google’s rising capex budget has historically been a good omen for Broadcom’s stock, and today is no exception.
The excitement goes beyond Google. If Gemini 3’s performance convinces other AI developers to ditch off-the-shelf GPUs for tailor-made accelerators, Broadcom could grab a bigger slice of the AI hardware market and chip away at Nvidia’s $NVDA ( ▲ 2.05% ) dominance.
Broadcom has already started positioning itself for that world. In mid-October, it unveiled a collaboration with OpenAI to develop and deploy 10 gigawatts of custom AI accelerators, a scale that would put it firmly in the center of the next wave of AI infrastructure.
Nvidia’s Jensen Huang continues to argue that GPUs remain king because of CUDA’s massive software ecosystem, but today’s market move shows investors are willing to imagine a world where custom chips take a much bigger role.