OpenAI partners with Broadcom to build its first custom AI processor
OpenAI has teamed up with Broadcom to produce its first in-house artificial intelligence processors, a key move as the company seeks to secure the computing power needed to meet growing demand for its services. Broadcom shares rose over 12% in premarket trading following the announcement.
Under the deal, OpenAI will design the chips, while Broadcom develops and deploys them starting in the second half of 2026. The rollout will include 10 gigawatts of custom chips, roughly equivalent to the electricity needs of over 8 million U.S. households or five times the output of the Hoover Dam, News.Az reports, citing Reuters.
“Partnering with Broadcom is a critical step in building the infrastructure needed to unlock AI's potential,” said OpenAI CEO Sam Altman.
The agreement follows a string of major AI chip deals by OpenAI, including a 6-gigawatt supply deal with AMD and Nvidia’s planned $100 billion investment to provide OpenAI with data-center systems totaling at least 10 gigawatts of capacity.
Broadcom, traditionally known for networking hardware, has become a major winner in the AI boom, with its stock nearly six times higher since 2022. The new chips will rely entirely on Broadcom’s Ethernet and networking systems, aiming to reduce reliance on Nvidia’s processors and challenge its InfiniBand solutions.
The deployment of the new chips is expected to be completed by the end of 2029, expanding on existing co-development agreements between the two companies.
OpenAI now joins cloud-computing giants like Google and Amazon, which are also developing custom AI chips to meet growing demand and enhance computing efficiency.
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