OpenAI Financing Talks Face New Hurdle

Last week, reports said Broadcom's AI chip partnership with OpenAI encountered an $18 billion financing obstacle tied to the first phase of chip production.

Under the proposed structure, Microsoft would host the chips in its data centers and lease computing capacity back to OpenAI.

The report said Broadcom views Microsoft's purchase commitment as critical to its confidence in repayment. At the same time, OpenAI considers the project essential to lowering long-term server costs and improving margins as it projects more than $200 billion in operational spending through 2029.

Broadcom Expands AI Infrastructure And Partnerships

The financing could become one of the largest private credit deals ever completed and further strengthen Broadcom's position in custom AI chips and infrastructure.

Goldman Sachs Sees Long-Term AI Demand Tailwind

Goldman Sachs analyst James Schneider reiterated a Buy rating and maintained a $480 price target on Broadcom, the Street reported on Sunday.

Schneider and his team said the rise of "agentic AI" could sharply increase global token consumption as AI agents handle more search, shopping, travel, email, and enterprise tasks.

Schneider said hyperscalers and large language model providers will likely continue increasing AI infrastructure spending, creating favorable conditions for semiconductor companies such as Broadcom.

AVGO Price Action: Broadcom shares were up 0.69% at $432.93 at the time of publication on Monday. The stock is trading near its 52-week high of $437.68, according to Benzinga Pro data.

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