Overview
- Broadcom and OpenAI announced a collaboration on custom AI accelerators totaling 10 gigawatts, with OpenAI designing chips and systems and Broadcom supplying Ethernet and other connectivity while assisting development and deployment.
- First systems are expected in the second half of 2026, with the full 10 gigawatts slated to be online by the end of 2029.
- Jefferies elevated Broadcom to its Top Pick and Franchise Pick status and lifted its price target to $480, citing accelerating demand for custom AI silicon.
- Broadcom confirmed a separate $10 billion contract with an unnamed customer that is not OpenAI.
- Analysts estimate the OpenAI collaboration could generate $150 billion to $200 billion for Broadcom over its life, though the ramp depends on OpenAI securing funding for multiple large compute commitments reported with Oracle, Amazon, Nvidia and AMD.