Facebook dad or mum Meta Platforms will use Broadcom’s customized chips to construct its metaverse {hardware}, changing into the chipmaker’s subsequent billion-dollar ASIC buyer, analysts at JP Morgan stated on Tuesday.

ASIC (application-specific built-in circuit) chips will drive $2 billion (roughly Rs. 15,519 crore) to $2.5 billion (roughly Rs. 19,399 crore) in income for Broadcom this 12 months, helped by its offers with Meta and partnerships with Alphabet and Microsoft, the analysts stated.

“We believe these wins are primarily at 5 nanometre and 3 nanometre and will be used to power Meta’s metaverse hardware architecture that it will deploy over the next few years,” analyst Harlan Sur stated.

Meta is investing closely within the metaverse — a digital house the place folks work together, work and play — by including new options to {hardware} gadgets that function entry factors to the digital world.

Sur added that Meta will emerge as Broadcom’s subsequent $1 billion (roughly Rs. 7,760 crore) a 12 months ASIC buyer over the subsequent three to 4 years after Google.

ASICs are designed to carry out hyper-specific duties, together with in AI and machine studying, effectively.

Broadcom and Google have co-developed Google’s customized chip used for machine learnings duties since 2016 and the brokerage estimates this to be price over $1.3 billion (roughly Rs. 10,088 crore) in 2022.

Meta is growing a spread of {hardware} merchandise for the metaverse that embody good glasses and digital actuality headsets, and has even opened its first bodily retailer the place consumers can check out these gadgets and different devices.

“Near-term ASIC program pipeline is strong as we believe Broadcom will be ramping Meta/Facebook and Microsoft ASICs this year,” Sur added.

Broadcom’s semiconductor options enterprise, which makes customized chips, contributed greater than 70 % to the corporate’s almost $27.5 billion (roughly Rs. 2,134,26 crore) income in 2021.

© Thomson Reuters 2022