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247wallst.comSEP 103 min read$AVGO

OpenAI Picked Broadcom for Its First Custom AI Chip. The Race for Number Two Just Got Dangerous.

Broadcom (AVGO) developed OpenAI's first custom AI chip, Jalapeno, and is working on a third-generation chip. OpenAI is also collaborating with Samsung, but details are unclear. AVGO stock is down 13.74% over a month. Broadcom forecasts $115B in AI semiconductor revenue by fiscal 2027 and $230B by 2028. Analysts' average price target is $533.41.

Original reporting
247wallst.com
Published Sep 10, 2026, 5:00 PM UTC
Analysis
AlphAI AI DeskAI-generated
Added to AlphAI Sep 10, 2026, 5:33 PM UTC. Informational, not investment advice.
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OpenAI Picked Broadcom for Its First Custom AI Chip. The Race for Number Two Just Got Dangerous. — source image
Source · 247wallst.com
Decision brief

The 30-second read

$AVGOBullishMed
01

Why it matters

The disclosed AI revenue forecasts and chip shipment represent a material growth catalyst for Broadcom, though competitive risk from Samsung remains.

02

Market read

Broadcom's AI partnership could drive significant revenue growth, influencing the broader AI hardware sector.

03

What to watch

Potential supply‑chain constraints for HBM memory and fab capacity could delay AI revenue realization.

Relevance 7/10Novelty 6/10Timing: post‑earnings September 2 call

Background

Broadcom's AI chip win follows its broader strategy to embed custom accelerators in hyperscale AI workloads.

Company-level read

Ticker impact

$AVGOBullishHigh confidence
Context

Broadcom disclosed shipping OpenAI's Jalapeno AI inference chip and forecast $115B AI semiconductor revenue for FY2027.

Expected impact

Potential upside if AI revenue guidance is met; downside risk from Samsung partnership uncertainty.

Evidence & confidence

First disclosure of a major AI chip win and large revenue forecasts for a large-cap company.

Market effects

Sector

Strengthens the AI semiconductor sector and may boost peers with similar design partnerships.

Regional

U.S. semiconductor market sees renewed demand from hyperscale AI customers.

Global

Highlights the competitive dynamics between Broadcom and Samsung in AI hardware.

Counterpoint

What could challenge this read

Samsung's vague involvement could signal a future shift away from Broadcom, weighing on the stock.

Key entities

  • company
    Broadcom

    U.S. semiconductor giant (NASDAQ:AVGO) supplying AI inference chips to OpenAI.

  • company
    OpenAI

    AI research lab and large AI model provider partnering with Broadcom on custom chips.

  • company
    Samsung

    Potential memory/fab partner for OpenAI's next‑gen AI chips.

Read at source← All news

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