Broadcom stock jumped Tuesday on a report that OpenAI is partnering with the fabless chipmaker to develop an AI inferencing processor.
Reuters reported that OpenAI wants to build an artificial intelligence processor in-house to lessen its reliance on AI chip giant Nvidia.
Broadcom and OpenAI will develop the AI chip and Taiwan Semiconductor Manufacturing will produce it, Reuters said. The contract chipmaker, also known as TSMC, is expected to start manufacturing the chips in 2026, the article said.
The report noted that OpenAI will continue buying Nvidia chips along with ones from rival Advanced Micro Devices as it scales up its computing infrastructure.
OpenAI is the fast-growing company behind buzzy AI chatbot ChatGPT.
Broadcom Stock On Tech Leaders List
Broadcom already makes custom AI chips for Alphabet's Google Cloud and Meta Platforms.
On the stock market today, Broadcom stock rose 4.2% to close at 179.24. TSM stock advanced 1.2% to 196.94.
Meanwhile, Nvidia stock climbed 0.5% to 141.25. AMD stock increased 4% to 166.25 during regular session, but fell late after its earnings report.
Broadcom stock is on the IBD Tech Leaders list, as are Nvidia, AMD and Taiwan Semiconductor.
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