Shiny Boxes & Fool’s Gold: 2026 Forecast

So, they’re building bigger and bigger boxes, are they? Cramming them full of… well, let’s call them ‘brain-boxes’ – these artificial intelligences, gobbling up electricity like greedy little monsters. Naturally, this means a frightful demand for wires and switches – the plumbing of the digital world. They say the market will swell from a perfectly respectable $39.5 billion to a rather portly $93 billion by 2032. A grand sum, indeed. A grand sum for someone, anyway.

Now, two companies seem to be positioning themselves rather nicely to scoop up a portion of this… bounty. Broadcom and Arista Networks. Both sell the bits and bobs that make these brain-boxes chatter to each other. Let’s have a peek behind the curtain, shall we?

Broadcom

Broadcom, you see, has become something of a purveyor of digital intestines. They supply the switches and little ‘speed-bumps’ that connect all the processors inside these monstrous data centers. The actual thinking is done by these ‘brain-boxes’ – the GPUs and custom gizmos – but they’re utterly reliant on Broadcom’s bits to pass messages back and forth. It’s a rather clever position, really. Like being the postman to a colony of particularly demanding ants.

Their recent numbers are… impressive, if you’re the sort who gets excited by large numbers. In the first quarter of their 2026 fiscal year (ending February 1st, a rather arbitrary date, if you ask me), their ‘AI revenue’ – a phrase designed to make investors salivate – rose a whopping 106% to $8.4 billion. A third of that came from networking, which grew 60%. They’re practically printing money, these chaps.

They’re predicting another $10.7 billion in the next quarter. And their CEO, a Mr. Hock Tan (a name that sounds suspiciously like a villain from a penny dreadful), is forecasting over $100 billion in ‘AI chip revenues’ by 2027. He’s secured supply chains until 2028, which means they’ll be able to keep the gravy train rolling, regardless of any pesky shortages. They’re estimating around $33 to $40 billion from networking alone. It’s a beautiful racket, really.

Their ‘Tomahawk 6’ switch is apparently the darling of the data centers, connecting all the processors like a nervous system. They’re also pushing a ‘200-gigabit SerDes’ – a fancy name for a particularly speedy wire. And they’re working on ‘Tomahawk 7,’ which will be twice as fast. More speed, more data, more money. It’s all rather predictable, isn’t it? Wall Street, naturally, is frothing at the mouth, predicting a 37.6% upside. Baird, a particularly optimistic firm, thinks it could climb even higher, to $630. A truly astonishing sum.

So, with all this spending on AI and networking, Broadcom seems rather well-positioned to line its pockets. A perfectly respectable outcome, from their perspective, no doubt.

Arista Networks

Now, Arista Networks. Another player in this digital game of tag. They supply high-performance Ethernet switches and software for these enormous data centers, connecting servers, storage, and those brain-boxes we discussed. Essentially, they’re the road builders of the information superhighway.

Their revenues in 2025 were around $9 billion, up 28.6%. They’re expecting $11.25 billion in 2026 – a tidy 25% increase. And, wouldn’t you know it, AI networking is the engine driving this growth. They’re now predicting $3.25 billion in AI networking revenue. A rather significant number, wouldn’t you agree?

They’re working with four major AI customers, three of whom have deployed nearly 100,000 GPUs each. A truly alarming number of brain-boxes. The fourth customer is ditching Nvidia‘s ‘InfiniBand’ – a rather clunky system, apparently – and switching to Arista’s Ethernet. They’re expecting that client to reach the 100,000 GPU mark in 2026. They’re also seeing demand from AI model builders and these curious ‘neocloud’ platforms. It’s a bit of a tangled web, really.

Arista’s networking portfolio involves Ethernet switches operating at speeds ranging from 10 gigabits to 800 gigabits per second. They’re preparing for the next upgrade cycle to 1.6 terabits. More speed, more data, more… well, you get the idea. They had over 100 customers adopting 800-gigabit systems in 2025. A truly impressive number of wires and switches.

Wall Street, predictably, sees an upside potential. The consensus target price is $177, implying a 30.2% increase. A perfectly acceptable return, I suppose.

If AI spending continues to accelerate and this ‘open-standards Ethernet’ becomes the preferred architecture, Arista might see even more gains. A perfectly plausible scenario. It’s all a bit… predictable, isn’t it?

2026-03-17 17:53

Broadcom

Arista Networks

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