Broadcom soars after announcing deal with OpenAI to deploy 10 gigawatts of AI accelerators starting next year

Broadcom is spiking in early trading after the chip designer announced that it’s collaborating with OpenAI to develop and deploy 10 gigawatts of custom AI accelerators for use across data centers.

The companies said these racks and systems will start to be in service in the second half of 2026 and fully completed by the end of 2029.

Broadcom soared during its Q3 earnings call when CEO Hock Tan said the chip designer booked a major new customer that the Financial Times later reported was OpenAI. However, CNBC is reporting that Charlie Kawwas, Ph.D. and president of the semiconductor solutions group for Broadcom, indicated that OpenAI is not that mystery $10 billion buyer.

There were no details on financial terms in today’s press release, though The Wall Street Journal says the new agreement is worth “multiple billions of dollars,” citing people familiar with the matter.

“The racks include Broadcom’s end-to-end portfolio of Ethernet, PCIe and optical connectivity solutions, reaffirming our AI infrastructure portfolio leadership,” said Kawwas in the press release.

“By building our own chip, we can embed what we’ve learned from creating frontier models and products directly into the hardware, unlocking new levels of capability and intelligence,” said Greg Brockman, OpenAI cofounder and president.

The calendar is telling me it’s fall, but it really feels like OpenAI announcement season. Just last week, the ChatGPT developer struck a megadeal that sees it get an up to 10% stake in Advanced Micro Devices, rounding out a series of massive commitments that will require the venture to find (and burn) much more cash.