Infrastructure Software — Scenario Model

Current Price

$301

Infrastructure Software Component

$54/sh

Market Implies

58% chance of upside scenarios

42% bear probability

Scenario Overview

Scenario	EV	$/sh	Prob	Key Gate
bull	$431B	$91	26%	vcf shelfware converts
base	$277B	$59	32%	—
bear	$128B	$27	42%	china exodus

Gate Milestones

Growth is gated by milestones. Cost step-changes and capability unlocks are tied to specific milestones.

2027

vcf shelfware converts

VCF shelfware converts to active deployment at 70%+ of signed customers

Unlocks: Validates VCF as sticky platform; reduces churn risk from backlash

90% of top 10K signed VCF but CEO acknowledged shelfware risk [vmware_integration.json]; migration takes 8-12 weeks (small) to multi-year (large) [customer_dynamics.json]

2027

churn accelerates

Churn hits 16%+ as Kubernetes/Nutanix migrations complete at early movers

Unlocks: Triggers cascade: successful migrations embolden others to leave

86% actively reducing footprint [customer_dynamics.json]; Gartner: share to 40% by 2029 [customer_dynamics.json]; Nutanix 640 wins in Q1 FY2026 [customer_dynamics.json]

2029

china exodus

China SOE VMware reduction reaches critical mass

Unlocks: Loss of China enterprise revenue creates additional headwind

China CAC directing SOEs to reduce VMware dependence [customer_dynamics.json]

Full Year-by-Year Models

Blue = input · Black = computed · Click to expand

Market-Implied Probability Reconciliation

Given these scenario EVs, what probability weights would the market need to assign to produce the current market-implied value of $54/share?

Scenario	Software EV	Per Share	Implied Prob.	Weighted Contrib.
bull	$431B	$91	25.9%	$24
base	$277B	$59	32.3%	$19
bear	$128B	$27	41.8%	$11
Total			100%	$54/sh

Note: These probabilities apply to Infrastructure Software (primarily VMware). AI Semi and Non-AI Semi contribute separately to Broadcom equity.

Target contribution: $54/sh. Residual: $0.0/sh.