Broadcom is working on a financing structure that could ultimately total up to $100 billion. The funds are intended to finance AI chips and related infrastructure for companies such as Anthropic. The deal underscores how the growth of AI is increasingly becoming a financing issue as well.
According to Bloomberg, Broadcom is negotiating with lenders on a package, the main portion of which could range from $60 billion to $70 billion. In addition, discussions are underway regarding approximately $30 billion in subordinated loans. The terms have not yet been finalized, and the capital may be raised in several phases.
Broadcom is reportedly acting as a guarantor for a portion of the senior loans. By doing so, the chipmaker is reducing some of the risk for investors, which could lower financing costs.
Financing chips for Anthropic
The funds are intended to help companies like Anthropic secure sufficient AI hardware and data center capacity. The developer of Claude needs large amounts of computing power for further growth. Instead of purchasing all the necessary hardware directly itself, chips can be acquired through separate financing structures and then made available to AI companies.
Broadcom has experience with such a model. The company previously established the AI XPV platform in partnership with Apollo Global Management and Blackstone. The first transaction through that partnership totaled $35 billion. Investors financed chips developed specifically for AI that are leased to Anthropic. According to Reuters, the project is expected to enable up to 20 GW of computing capacity by 2028 at the latest.
According to Bloomberg, Apollo and Blackstone are also involved in the discussions regarding the new funding round. The debt would be placed in a separate legal entity. In such structures, Broadcom guarantees a significant portion of the financing. This helped secure an investment-grade rating for the senior loans in the previous transaction.
Broadcom aims to expand its position in custom chips
For Broadcom, more is at stake than just selling chips to Anthropic. The company is a major developer of custom AI processors and works in this field for clients including Alphabet and Meta. In this way, Broadcom competes from a different angle with Nvidia, which dominates the market for general-purpose AI accelerators.
CEO Hock Tan expects AI chip sales to exceed $100 billion next year. However, to enable that growth, the infrastructure in which these processors are deployed must also be financed. By providing capital in partnership with investors, Broadcom is thus indirectly helping to expand the market for its own hardware.
This approach is not unique. According to Reuters, major technology companies such as Alphabet, Amazon, and Microsoft are increasingly turning to the capital markets to finance their rapidly rising AI investments. Nvidia, too, is now working with financial institutions on arrangements designed to make hundreds of billions of dollars available for AI infrastructure.
As a result, competition surrounding AI hardware is shifting, in part, to the financial world. It is not only the performance and availability of chips that determine how much AI capacity can be built; the ability to free up tens of billions of dollars for chips and data centers is also becoming a decisive factor.