- For Broadcom, this breakthrough deal cements its role as a key player in the AI infrastructure sector.
- Broadcom’s shares are rising thanks to the OpenAI agreement.
- For Broadcom, this breakthrough deal cements its role as a key player in the AI infrastructure sector.
- Broadcom’s shares are rising thanks to the OpenAI agreement.
OpenAI has announced a strategic partnership with Broadcom aimed at developing and deploying its first independently designed artificial intelligence chips. This move responds to the company’s rapidly growing computational needs as it develops advanced generative models like ChatGPT. The new chips are scheduled to be launched in the second half of 2026, with a combined power capacity of 10 gigawatts—more than five times the energy generated by the Hoover Dam and enough to power over 8 million households in the United States. Following the announcement, Broadcom’s stock jumped nearly 8% at the start of trading!
Under the agreement, OpenAI will handle the design of the graphics processing units (GPUs), while Broadcom will be responsible for their technical development, manufacturing, and integration with servers and data center infrastructure. The new systems will be deployed both in OpenAI’s own facilities and in data centers managed by external partners. The entire setup will rely on Broadcom’s networking technology, including Ethernet solutions, which could serve as a viable alternative to Nvidia’s currently dominant standard.
This agreement fits into OpenAI’s broader strategy to reduce dependency on Nvidia’s limited supply and high-cost chips. Previously, OpenAI signed a contract with AMD for 6 gigawatts worth of chips and is collaborating with Nvidia to build infrastructure with an additional 10 gigawatts of capacity. Altogether, this amounts to 26 gigawatts of contracted computing power—more than the total summer electricity consumption of New York City.
For Broadcom, this is one of the largest and most prestigious contracts in the company’s history. Traditionally known for networking chips and telecommunications solutions, Broadcom is now becoming a key player in the emerging AI infrastructure segment. Since the end of 2022, Broadcom’s stock price has been in a strong upward trend, rising nearly sixfold. Moreover, Broadcom’s revenue grows quarter after quarter, with each financial report confirming the increasing importance of the AI chip segment in the company’s overall revenue structure. The partnership with OpenAI further strengthens Broadcom’s position as a major beneficiary of the global artificial intelligence boom.
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