Bank of America analyst Michael Hartnett popularized the phrase “Magnificent Seven” in 2023 to describe seven tech-focused companies driving broader market returns. The list includes Nvidia, Apple, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), Microsoft, Amazon, Meta Platforms, and Tesla.
These companies are undeniably influential — accounting for over a third of the S&P 500‘s market cap. But the list has a glaring flaw — it doesn’t include Broadcom (NASDAQ: AVGO).
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Broadcom reached an all-time high on April 22, surpassing $2 trillion in market cap. That makes Broadcom the sixth-most-valuable U.S. company — ahead of Meta and Tesla, and behind Nvidia, Apple, Alphabet, Microsoft, and Amazon.
Broadcom has produced a total return of 143.9% over the past year, outperforming every Magnificent Seven stock. Here’s why Broadcom continues to soar with no signs of slowing down, and why it remains a generational buying opportunity for long-term investors.
Broadcom’s networking deal with Google Cloud
Broadcom popped 5.1% on April 22 in response to broader market gains and a press release announcing an expanded collaboration with Alphabet’s Google Cloud for its Cloud Network Insights service. Cloud Network Insights will be an exclusive feature for Google Cloud customers.
The service will be enabled by AppNeta, a network monitoring tool from Broadcom, for software-as-a-service (SaaS), cloud, and critical applications. It provides active and passive monitoring for pinpointing problems across SaaS and cloud application traffic. Broadcom argues that traditional monitoring tools are no longer sufficient to handle complex networks — especially when they span on-premises, multiple clouds, third-party networks, and SaaS environments.
Custom AI chips for major hyperscalers
On the same day as the Cloud Network Insights announcement, Google’s senior VP and chief technologist for AI and infrastructure, Amin Vahdat, released a blog post discussing new Tensor Processing Units (TPUs) — the TPU 8t for AI training and the TPU 8i for inference. TPUs are designed by Google in partnership with Broadcom.
TPU 8t reduces development time for frontier models by enabling faster compute and storage access, whereas TPU 8i provides more memory for latency-sensitive workloads between AI models and agents.