OpenAI joined the world’s biggest technology companies in the race to develop their own AI chips, reducing reliance on Nvidia.
What happened: Multiple media outlets reported that U.S. chipmaker Broadcom's new US$10 billion “mystery” customer is actually ChatGPT-maker OpenAI. People familiar with the partnership confirmed that the company will produce its first in-house AI chip next year.
- The move follows the strategy of companies like Google, Amazon, and Meta, which have spent the last few years designing specialized chips to run their AI workloads.
Why it matters: As the demand for computing power grows alongside the use of artificial intelligence, controlling chip design has become critical for companies like OpenAI to scale AI models like GPT-5. It could even determine who comes out on top in the AI arms race.
- American dominance in AI also depends heavily on Nvidia chips, which are produced by TSMC in Taiwan, making the supply chain vulnerable to geopolitical risks.
Bottom line: While Nvidia continues to dominate in the AI hardware space, the value of Broadcom is on the rise. Shares have climbed over 40% just this year, with some analysts predicting stronger growth in its custom AI chip business compared to Nvidia’s by 2026.