By Simply Wall St
Publication Date: 2026-05-09 13:41:00
- Broadcom (NasdaqGS:AVGO) is working on an estimated US$18b custom AI chip deal with OpenAI that now faces major financing challenges.
- Broadcom is seeking a commitment from Microsoft to purchase about 40% of the chips upfront before funding the initial phase of production.
- Uncertainty around Microsoft’s purchase commitment has contributed to delays in moving the project forward and volatility in Broadcom’s share price.
Broadcom, through its semiconductor business, has been positioning its custom AI accelerators and networking chips as part of the buildout of large scale AI infrastructure. This potential US$18b deal with OpenAI would sit alongside the broader industry push to secure high performance, application specific hardware for AI training and inference.
For investors looking at NasdaqGS:AVGO, the situation highlights how capital intensive custom AI projects can be and how much they depend on long term purchase agreements. The back and forth around financing and chip…
