ByteDance's custom chip made by Broadcom has been canceled, Broadcom to lose $2B to $3B

Broadcom has reportedly seen its huge ByteDance project canceled, after the parent company of TikTok tasked the US company to design a new AI accelerator.

In a new post by insider @Jukanlosreve, we're hearing that as US semiconductor restrictions tighten on China, HBM-based chip designs are being categorized as AI-related and subject to tighter controls. Over the last few months, there has been a sustained decline in CoWoS advanced packaging orders from Chinese companies.

The post continues, explaining that Chinese customers including T-Head has "significantly reduced" its CoWoS orders, "which we believe will eventually drop to zero, Sanechip shipments are halted after completing its production in 1Q25, and Broadcom's ByteDance project has also been suspended".

In a different post on X, @Jukanlosreve explained: "In June last year, ByteDance reportedly partnered with Broadcom to develop a 5nm AI accelerator, a type of ASIC. This partnership builds on the relationship established when Broadcom began supplying high-performance semiconductor switches to ByteDance several years ago".

"Broadcom's top ASIC customers are, in order, Google, Amazon Web Services (AWS), and ByteDance. The combined revenue contribution from these three companies reaches up to $20 billion. Broadcom, which projects the total serviceable available market (SAM) for ASICs to reach $60-$90 billion by 2027, is estimated to incur losses of $2-$3 bilion from the TikTok ban. This could also impact SK hynix, as the company is discussing supplying 20,000-30,000 HBM units per month for Broadcom's ASICs".