Apple is working with Broadcom to develop its first server chip specially designed for artificial intelligence processing, the Information reported on Wednesday, citing people with direct knowledge of the matter.

Both stocks have had strong runs in 2024. Let's consider which semiconductor looks like the better buy heading into 2025.

Broadcom estimates revenue from its three existing hyperscale customers will range from $60 billion to $90 billion in 2027, up from $12.2 billion in 2024. In other words, the company anticipates that custom AI chip sales will increase at least 70% annually in the next three years, but perhaps as quickly as 95% annually.

Broadcom may have had a volatile year, but the stock was rising on investor enthusiasm Tuesday as it headed for its best year on record. The California-based tech company is known for making application-specific integrated circuits,