Follow ZDNET: Add us as a preferred source on Google.
ZDNET’s key takeaways
OpenAI is building an in-house AI chip with Broadcom.The effort is likely the result of a partnership valued at $10 billion.Many AI companies are launching their own chipmaking operations.
OpenAI is gearing up to launch its own AI chip, part of a broader industry effort to gain independence from third-party semiconductor companies.
The ChatGPT-maker will start mass-producing its first in-house graphics processing unit (GPU) in partnership with US chipmaker Broadcom next year, according to a Thursday report from the Financial Times. The chip will reportedly be used internally by OpenAI rather than sold to other businesses.
Also: AI’s not ‘reasoning’ at all – how this team debunked the industry hype
The report followed a Thursday statement from Broadcom CEO Hock Tan to investors that the company had secured a $10 billion deal with an unnamed new customer to build new AI chips. Many analysts believed that the new client was OpenAI, a suspicion which was later confirmed by the Wall Street Journal.
OpenAI and Broadcom did not immediately respond to ZDNET’s request for comment.
(Disclosure: Ziff Davis, ZDNET’s parent company, filed an April 2025 lawsuit against OpenAI, alleging it infringed Ziff Davis copyrights in training and operating its AI systems.)
Originally invented to render video game graphics, GPUs have become the technological cornerstone of the ongoing generative AI boom, fueling chatbots like ChatGPT, Gemini, and Claude. The market has thus far been dominated by Nvidia, which is currently ranked as the wealthiest company in the world thanks to the surging demand for its industry-leading chips like the A100 and H100.
Also: The fastest growing AI chatbot lately? It’s not ChatGPT or Gemini
Other chipmakers, like AMD and Broadcom, have also seen significant growth. Broadcom crossed the trillion-dollar valuation mark in December and is rumoured to also partner with Google, Meta, and ByteDance.
A global chip bottleneck
The rule over the AI market by a handful of chipmakers has led to a situation in which tech developers often have to wait months to receive orders of new chips. The strain on supply, meanwhile, has caused prices to spike.
Also: DeepSeek may be about to shake up the AI world again – what we know
Leading AI companies like Microsoft, Amazon, and Meta have therefore sought to reduce their dependency on Nvidia and the other third-party chipmakers by launching their own chip-manufacturing efforts. Recently, the Trump administration allowed Nvidia to sell certain chips to China again after a Biden-era ban meant to curb competition.
OpenAI CEO Sam Altman has been adamant about the need for his own company to develop its own chips, but it hasn’t yet been clear exactly how that vision would take shape. (The company has thus far been dependent upon Nvidia and AMD.) Reuters reported last year that the company was working with Broadcom and Taiwan Semiconductor Manufacturing Co. (TSMC) in order to build its own AI chips. In March, TSMC announced a $100 million investment in chip manufacturing in the US.
Also: Worried about AI’s soaring energy needs? Avoiding chatbots won’t help – but 3 things could
The industry-wide pressure to secure a private source of AI chips has been exacerbated by a simultaneous drive to build increasingly massive data centers, which power AI systems and require vast quantities of water and electricity.