Broadcom secures $10 billion ASIC contract, with Apple and xAI next in line for new AI chips

Broadcom has secured a huge $10 billion custom ASIC contract from a major new customer that is outside of the core hyperscale cloud service provider (CSP) segment, with Apple and xAI also next in line behind them.

In a new report from Digitimes picked up by @Jukanrosleve on X, we're hearing that further orders from TikTok parent company ByteDance, Apple, and Elon Musk's xAI are already in the pipeline, with a development analysis seeing it as reinforcing Broadcom's position as a "credible challenger" to NVIDIA.

According to industry sources, OpenAI's new custom ASIC will enter mass production in 2026, and will position the AI startup as Broadcom's fourth confirmed large-scale ASIC customer. Neither Broadcom nor OpenAI have commented on the deal yet, but insiders that are familiar with Broadcom's roadmap have confirmed the order is indeed genuine.

We have had rumors and reports of OpenAI's in-house chip ambitions for a couple of years now, with the Sam Altman-led AI startup beginning to develop its own in-house custom silicon to meet its continuously rising AI workloads, but the company hit just a few roadblocks, which helped the design pass specification testing requirements rather quickly.

OpenAI had very, very lofty ambitions of building their own semiconductor foundry, but that disappeared as quick as the rumors started, with the company rumored a while back to fab its first AI chips with Broadcom and TSMC, and now here we are. OpenAI was previously rumored to have its self-developed AI chip fabbed at TSMC on its new A16 process node, but it looks like Broadcom has won that $10B contract.

This move also (ever-so-slightly) reduces OpenAI's dependence on NVIDIA, but I'm sure we're going to see reports with striking eye-grabbing headlines in the future with something like "OpenAI breaks up with NVIDIA, no longer needs their market-dominating AI GPU hardware". That change isn't going to happen overnight, but in the years and years to come, we'll see a slight reduction in dependence to NVIDIA.

That's today, with Hopper and Blackwell AI GPUs like the H100, H200, B100, B200 AI GPUs... let alone the new Blackwell Ultra GB300, and the next-gen Rubin R100 AI GPU with next-gen HBM4 memory launching in 2026.