"For Broadcom, the move provides deeper access to the booming AI market. Monday's agreement confirms an arrangement that Broadcom Chief Executive Officer Hock Tan had hinted at during an earnings conference call last month. Investors sent Broadcom shares up as as much as 11% on Monday, betting that the OpenAI alliance will generate hundreds of billions of dollars in new revenue for the chipmaker."
"As part of the pact, OpenAI will design the hardware and work with Broadcom to develop it, according to a joint statement on Monday. The plan is to add 10 gigawatts' worth of AI data center capacity, with the companies beginning to deploy racks of servers containing the gear in the second half of 2026."
"By customizing the processors, OpenAI said it will be able to embed what it has learned from developing AI models and services "directly into the hardware, unlocking new levels of capability and intelligence." The hardware rollout should be completed by the end of 2029, according to the companies."
OpenAI agreed to buy and co-develop custom chips and networking equipment with Broadcom to expand AI data-center infrastructure. The companies plan to add 10 gigawatts of capacity and begin deploying racks of servers with the new hardware in the second half of 2026, completing the rollout by the end of 2029. OpenAI says embedding model learnings directly into customized processors will unlock greater capability. Broadcom gained deeper access to the AI market and saw its shares jump, though payment details remain unclear and OpenAI continues to burn significant cash while raising funds.
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