OpenAI and Broadcom Forge a $10B Partnership for Custom AI Chip Development
OpenAI, in a landmark move, has inked a $10 billion deal with semiconductor behemoth Broadcom to create custom AI chips. This strategic shift significantly reduces OpenAI’s dependency on Nvidia’s GPUs. The announcement, made during Broadcom’s earnings call on September 5, 2025, places OpenAI as the fourth major customer for Broadcom’s custom AI processors (XPUs).
Broadcom’s CEO, Hock Tan, verified the colossal order during the earnings call, without directly naming OpenAI. However, The Financial Times later revealed OpenAI as the undisclosed customer behind the deal. The custom chips, manufactured using TSMC’s advanced 3nm process technology, are slated for shipping in late 2026.
The partnership aims to tackle the GPU shortages that have previously hindered OpenAI’s product launches, including ChatGPT-4.5. This step aligns with OpenAI CEO Sam Altman’s prior statements about GPU constraints being a significant bottleneck for the company’s operations. Initially, the custom chips will be used internally to fuel OpenAI’s burgeoning AI services before considering a wider deployment.
Source: https://www.cnbc.com/2025/09/05/broadcom-avgo-stock-openai-earnings.html