Broadcom Stock Soars Over 9% on OpenAI AI Chip Partnership
The multi-year collaboration focuses on co-developing and deploying 10 gigawatts of custom AI accelerators for OpenAI's growing infrastructure needs.
Broadcom Inc. (AVGO) shares surged more than 9% after the company announced a major, multi-year collaboration with OpenAI to develop custom artificial intelligence accelerators. The deal solidifies Broadcom's position as a key player in the rapidly expanding AI hardware ecosystem, directly partnering with one of the world's leading AI research and deployment companies.
The and deploying 10 gigawatts of custom AI accelerator and network systems. Under the agreement, OpenAI will design the accelerators, leveraging its expertise in building frontier AI models, while Broadcom will handle the development and deployment. This deep integration aims to create highly optimized hardware that can unlock new levels of AI capability.
"Partnering with Broadcom is a crucial step in building the infrastructure necessary to realize the potential of AI and deliver its benefits to people and businesses everywhere," said Sam Altman, co-founder and CEO of OpenAI, in a statement. Hock Tan, President and CEO of Broadcom, described the collaboration as a "pivotal moment" in the pursuit of artificial general intelligence.
The deployment is scheduled to begin in the second half of 2026 and conclude by the end of 2029, utilizing Broadcom's Ethernet and connectivity solutions to scale the AI infrastructure. This move is part of , complementing existing relationships with other chip giants like Nvidia and AMD.
The market's strong positive reaction underscores investor confidence in Broadcom's ability to capitalize on the insatiable demand for AI computing power. The deal, which builds upon , positions Broadcom not just as a supplier but as a foundational technology partner in the development of next-generation AI systems.