Big tech companies are buying like crazy! Broadcom CEO: The AI spending boom will last until 2030

The AI craze is far from over, at least according to Broadcom CEO Hock Tan.

On December 20th local time, in an interview with the Financial Times, Tan stated that investor enthusiasm for Broadcom's AI chip business remains high, with the company's market value surpassing $1 trillion for the first time, and it is expected that the investment boom in artificial intelligence by major tech companies will continue until the end of 2030.

Tan mentioned that the company's clients are formulating three to five-year investment plans for AI infrastructure, and progress is very rapid:

“They are investing heavily, and they will only stop when the funds run out or shareholders cease to invest... There are only a few players, but they could be huge consumers of AI chips because the returns are enormous.”

Last Friday, Broadcom's stock price surged 24% in a single day after the company announced that its AI revenue for fiscal year 2024 skyrocketed by 220%, reaching $12.2 billion. As a result, the company's market value increased by over $200 billion, breaking the $1 trillion mark for the first time and successfully joining the exclusive club of "U.S. companies with a market value exceeding $1 trillion," which has only 8 members.

However, Tan remained very calm, stating that he “does not feel anything new”:

“Value is in the eye of the beholder; you must learn not to be swayed by it, but it is indeed a nice recognition... I guess I’m not the only one who believes that generative AI has great potential.”

But investors are excited—Tan previously revealed that by 2027, Broadcom's clients will deploy up to 1 million chips in AI clusters, and Broadcom's AI chips could bring hundreds of billions of dollars in annual revenue growth to the company.

However, even 1 million chips may not be enough to achieve the ultimate goal of OpenAI and its competitor Anthropic: to create artificial general intelligence (AGI) that surpasses human capabilities. Tan stated:

“I don’t think anyone knows (if it can be achieved), but the opportunity is too great to resist.”

Broadcom is closely collaborating with multiple tech giants

This year, investments in data centers by large tech companies and AI startups like xAI have been unprecedented—to gain an edge in "next-generation computing," companies are creating and running increasingly large AI models.

Although there is currently no consensus on whether generative AI can help ordinary businesses save costs, Tan stated that many tech companies see a huge opportunity and believe this opportunity can generate substantial revenue. Tan said:

“They need unprecedented scale to train AI, which consumes a massive amount of silicon chips, and that’s where we come in.”

“They already have a formula to keep pushing forward, and they haven’t reached the end of that formula; all roads point in one direction: you need more computing chips.” Broadcom did not disclose the specific names of its chip customers, but analysts stated that Broadcom has collaborated with companies such as Google, Meta, and ByteDance to design custom processors to accelerate the training and deployment of AI systems.

Reports indicate that OpenAI and Apple are also working with Broadcom to develop their own AI server chips, as tech companies are seeking alternatives to NVIDIA's chips.

Previously, there were even speculations in Silicon Valley that Broadcom might step in to rescue the struggling Intel—however, Tan denied rumors that Broadcom would acquire Intel, stating that he is already "extremely busy" in the AI semiconductor field and has "not been asked" to get involved in Intel's affairs. Tan also added:

"After the Qualcomm incident, I learned one thing: do not engage in hostile takeovers."