Broadcom’s rise is marked by aggressive acquisitions, sharp pivots into software, and a growing role in powering today’s AI-driven infrastructure.
Broadcom began as a semiconductor company, establishing itself as a key player in chip innovation and design. Over time, the company broadened its scope through acquisitions and diversification, positioning itself as a technology powerhouse. Today, Broadcom leads in the semiconductor industry and has also expanded into infrastructure software.
Early years (1961–1990s)
Broadcom traces its origin back to the early days of semiconductor innovation.
Origins in Hewlett-Packard
Broadcom began in 1961 as HP Associates, the semiconductor products division of Hewlett-Packard. It focused on pioneering technologies like LED billboards in the 1960s and the HP Interface Bus standard in the 1970s. In 1999, HP’s semiconductor arm was spun off during the creation of Agilent Technologies. Broadcom’s predecessor became part of that new company.
Founding of Broadcom Corporation
In 1991, Henry Samueli and Henry Nicholas, professor and student at UCLA, started Broadcom Corporation. Each invested $5,000 and moved operations to Irvine in 1995. The company made its public debut on the NASDAQ in 1998.
Early growth via acquisitions
Broadcom expanded aggressively through acquisitions in the early 2000s. Its first major profitable move was acquiring ServerWorks in January 2001. That acquisition brought in high-performance server I/O chipsets and expanded Broadcom’s reach into server infrastructure.
Expansion and diversification (2000s–mid-2010s)
Broadcom moved beyond its roots in semiconductors to build a broad, integrated technology platform.
Rapid portfolio diversification
The company added VisionTech, SiByte, Silicon Spice, and many more to its portfolio by acquiring emerging technology firms across wireless, networking, and broadband sectors. One notable deal was the acquisition of NetLogic Microsystems for $3.7 billion in February 2012.
Transition through the Avago merger
In May 2015, Avago Technologies announced plans to acquire Broadcom Corporation for $37 billion, using a mix of cash and stock. The combined entity was valued at $77 billion in enterprise value. The merger closed on February 1, 2016, marking the creation of a new, more diversified firm named Broadcom Limited.
Further acquisitions
In 2014, the company acquired PLX Technology, a specialist in PCIe and Ethernet chipsets, strengthening its position in high-speed networking. A few years later, Broadcom moved into enterprise storage and networking with the $5.5 billion acquisition of Brocade Communications Systems in 2016.
Diversification into enterprise software (late 2010s)
Broadcom took a decisive turn from hardware into software toward the end of the 2010s, targeting enterprise-focused, high-margin businesses.
CA Technologies (July–November 2018)
In July 2018, Broadcom agreed to buy CA Technologies for $18.9 billion in cash. CA was known for mainframe, cloud software, and identity management solutions. The deal closed in November 2018. However, the acquisition raised eyebrows. Analysts and media branded it a mismatch due to Broadcom’s prior focus on semiconductors. Immediately after closing, Broadcom laid off large portions of CA’s staff.
Symantec Enterprise Security (August–November 2019)
In August 2019, Broadcom announced the acquisition of Symantec’s Enterprise Security division for $10.7 billion in cash. This unit generated approximately $2.3 billion in annual revenue. Broadcom aimed to capture $1 billion in cost synergies in the first year post-close. The acquisition closed in November 2019, expanding Broadcom’s infrastructure software platform.
Regulatory challenges and controversies
Broadcom’s rapid rise brought regulatory scrutiny. The company faced political roadblocks, legal probes, and patent clashes.
Attempted acquisition of Qualcomm
In 2017, Broadcom launched an unsolicited takeover bid for Qualcomm. However, the Committee on Foreign Investment in the U.S. (CFIUS) stepped in. It blocked the deal over concerns that Broadcom would cut Qualcomm’s R&D and weaken U.S. leadership in 5G technology. The Trump administration banned the acquisition in March 2018.
Antitrust scrutiny
Between 2018 and 2021, the U.S. Federal Trade Commission (FTC) and the European Commission investigated Broadcom for anticompetitive behaviors. In response, Broadcom agreed to end exclusivity and quasi-exclusivity agreements for seven years. In 2023, South Korea’s Fair Trade Commission fined Broadcom ₩19.1 billion (around $14.3 million). The penalty was for forcing a long-term contract on Samsung.
Stock-option backdating scandal
Broadcom admitted to backdating stock options between 1998 and 2003, hiding over $2 billion in compensation expenses. This required a major financial restatement in early 2007. The SEC charged the company, resulting in a $12 million fine and a permanent injunction. Execs involved, including co-founders Henry Samueli and Henry Nicholas, and HR VP Nancy Tullos, faced legal scrutiny.
Patent disputes
In 2020, Broadcom sued Netflix, alleging infringement of its video streaming patents. Broadcom argued Netflix’s service used Broadcom’s patented technology without permission. In 2023, a German court backed Broadcom. It ruled that Netflix violated Broadcom’s HEVC/H.265 patent and issued an injunction to halt the infringement in Germany.
Landmark acquisition: VMware (2022–2023)
Broadcom’s takeover of VMware further pushed the company into enterprise software.
The deal
In May 2022, Broadcom announced its intention to acquire VMware in a deal valued at $61 billion, combining cash and stock, and assuming around $8 billion of VMware’s net debt. After rigorous scrutiny from regulators, Broadcom received all necessary approvals and completed the acquisition on November 22, 2023.
Integration and strategy
Immediately after the acquisition, Broadcom began streamlining VMware’s offerings. It restructured VMware into four divisions. Within a few weeks, the company discontinued perpetual license sales, shifting everything to subscription-based pricing.
Portfolio reshaping
To sharpen its focus, Broadcom sold VMware’s End-User Computing (EUC) division to private equity firm KKR. The deal, announced in February 2024, was valued at approximately $4 billion.
Market impact
Broadcom moved quickly to reduce costs. Job cuts and consolidation slashed VMware’s workforce by 50%, reducing staff from over 38,000 to around 16,000. The company also shifted 60% of VMware’s customers from perpetual to subscription licensing. These aggressive changes pleased investors. Broadcom’s stock rose, pushing its market capitalization past $1 trillion, a milestone reached in December 2024. The VMware acquisition also boosted Broadcom’s software revenue and strengthened its diversification beyond semiconductors.
Present position & future trajectory
Broadcom now plays a leading role in AI infrastructure while pursuing disciplined expansion.
Market leadership in AI chips
Broadcom has become a dominant supplier of custom AI chips to major hyperscalers like Google, Meta, ByteDance, and OpenAI. These chips are tailored for specific AI workloads and offer cost and efficiency advantages over more generic options.
Continued M&A momentum
Historically, Broadcom’s CEO Hock Tan has driven aggressive deal-making, successfully acquiring several companies. However, during the first quarter of fiscal 2025, Tan made it clear that M&A is not on the near-term agenda. He emphasized focus on AI and VMware integration instead of pursuing new acquisitions.
Broadcom’s bold ascent
Broadcom has evolved from a semiconductor division at HP into a chipmaking powerhouse. Looking ahead, its deepening ties with hyperscalers and rising software business positions it to shape and benefit from the fast-evolving AI infrastructure landscape.
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