Broadcom negotiates billions in AI financing for OpenAI

Broadcom is in preliminary talks to arrange billions of dollars in financing for OpenAI's custom chip initiative, known as the Nexus program. Reports diverge on the exact scale, with The Wall Street Journal reporting on Oct. 7 that Broadcom is working on more than $50 billion alongside Apollo Global Management and Blackstone. Fortune reported on Oct. 9 that the figure is around $30 billion, citing Bloomberg, while TrendForce noted on Oct. 8 that the discussions remain at an early stage. The Nexus initiative aims to deploy 10 gigawatts of custom accelerators by the end of 2029.

The talks mirror Broadcom's existing financial ties with Anthropic. According to regulatory disclosures reported by CNBC on Oct. 1, Broadcom provided a $42 billion convertible note facility to help finance roughly a third of Anthropic's $125.2 billion five-year TPU computing lease. Anthropic flagged potential conflicts of interest stemming from Broadcom acting as both its component supplier and its lender.

The funding relies heavily on private credit markets rather than traditional corporate loans. In June, Broadcom created the AI XPV platform with Apollo and Blackstone, executing an initial $35 billion transaction for Anthropic compute. A separate $60 billion syndicated package is currently in progress, consisting of $42 billion in senior secured debt with residual-value backing from Broadcom and $18 billion in junior debt, where Blackstone is leading roughly $9 billion. Bank of America, Citigroup, and Morgan Stanley are also participating in the syndicate.

Analysts point out that high-stakes financing has become essential in the semiconductor market. Jay Goldberg, an analyst at Seaport Research, told CNBC that Nvidia is using massive balance sheet resources and Broadcom is following suit. Meanwhile, Robert Leitao, managing partner at Rothschild & Co, told CNBC that the market is making a concentrated bet on whether two AI companies can generate enough revenue to support these debt structures.