OpenAI will design its own artificial intelligence (AI) processors with chipmaker Broadcom in a multi-billion dollar deal announced Monday, adding 10 gigawatts of computing power that would consume as much electricity as 8 million American homes.
The partnership marks OpenAI’s first attempt at designing a custom chip. Broadcom will manufacture and deploy the processors starting in late 2026.
This latest agreement brings OpenAI’s total computing commitments to at least 33 gigawatts across recent deals with Nvidia, AMD, Oracle, and now Broadcom. The ChatGPT maker currently operates on just over 2 gigawatts of capacity while serving 800 million weekly users.
“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’s president, in a joint press release.
The scale of these deals has stunned analysts. A single gigawatt data center costs roughly $50 billion to build, according to Nvidia CEO Jensen Huang’s August estimate.
“OpenAI has made, at this point, approaching $1 trillion of commitments, and it’s a company that only has $15 billion of revenue,” said Gil Luria, head of technology research at D.A. Davidson.
Custom chips could help OpenAI reduce its dependence on expensive Nvidia processors, which dominate the AI chip market. The new systems will run on Broadcom’s Ethernet networking technology rather than Nvidia’s InfiniBand solution.
Broadcom CEO Hock Tan captured the strategic thinking in a podcast released with the announcement: “If you do your own chips, you control your destiny.”
The news sent Broadcom shares soaring nearly 10 percent on Monday morning. The semiconductor company has become a major beneficiary of the AI boom by helping tech giants design specialized processors.
OpenAI CEO Sam Altman defended the massive infrastructure push. “Partnering with Broadcom is a critical step in building the infrastructure needed to unlock AI’s potential and deliver real benefits for people and businesses,” he said in the announcement.
Energy consumption has emerged as a pressing concern. A 2024 Department of Energy report found data centers could consume up to 12 percent of total U.S. electricity by 2028, nearly triple their current usage.
The companies haven’t disclosed financial terms, though sources familiar with the matter told The Wall Street Journal the Broadcom deal alone is worth multiple billions of dollars.
Deployment will begin in the second half of 2026 and will be completed by 2029. The custom chips will be installed in data centers operated by OpenAI and its partners.