Why Anthropic's Custom Chip Plans Could Benefit Broadcom

Key Points

• Broadcom and Anthropic are partnering on a massive TPU deal
• Anthropic is also considering developing its own chips, providing an additional opportunity for Broadcom
• However, whether Anthropic will actually develop its own chips is far from confirmed

Large language model developer Anthropic is one of the top names in the artificial intelligence (AI) race and is growing incredibly fast. From the end of 2025 to early April, Anthropic says its annual revenue run rate increased by more than three times, from $9 billion to over $30 billion.

To support its growth, the company is partnering with semiconductor giant Broadcom NASDAQ: AVGO. Anthropic plans to access 3.5 gigawatts of Tensor Processing Unit (TPU)-based AI compute through Broadcom over the coming years. These are the same types of chips that Broadcom has co-developed with Google parent company Alphabet NASDAQ: GOOGL.

However, reports have emerged stating that Anthropic is exploring the development of its “own” AI chips. For investors, it is important to understand what this actually means, and by extension, why Anthropic developing its own chips could ultimately be another big win for Broadcom.

AI Chip Development: Why Anthropic’s Exploration Could Include Broadcom

As first reported by Reuters, Anthropic is “exploring the possibility of designing its own chip," with the outlet citing three unnamed sources. Notably, the report states that these discussions are early. The company may ultimately decide to simply buy chips from other parties rather than design its own. Importantly, Anthropic has yet to assemble a dedicated team to pursue this project.

Nonetheless, should Anthropic commit to the project, it could have significant implications for Broadcom. Initially, it may alarm investors to hear that Anthropic could build its “own” chips, indicating it would do so completely independent of firms like Broadcom. However, evidence suggests that this path is unlikely.

Typically, when companies say they want to develop their own chips, it means that they intend to partner with semiconductor experts, such as Broadcom. Many would consider the TPU to be Google’s “own” chip, but in reality, they have partnered with Broadcom to develop this technology for around a decade. Meta Platforms NASDAQ: META also partners with Broadcom to develop its Meta Training and Inference Accelerator. Meanwhile, Amazon.com NASDAQ: AMZN partners with Marvell Technology NASDAQ: MRVL on its Trainium chips.

This shows a clear trend; even the world’s largest, most well-capitalized companies rely on semiconductor experts to help design their chips. Even with Anthropic’s astounding growth, one would be hard-pressed to argue that its resources exceed those of the Magnificent Seven giants. Thus, if these firms are partnering with semiconductor stalwarts, it is more likely than not that Anthropic would do the same. If Anthropic were to partner with Broadcom to develop chips, the benefits to Broadcom could be very considerable.

Expanding Beyond TPUs? Why Broadcom Could Benefit

While Anthropic is currently purchasing TPUs, a partnership to develop specific chips alongside Broadcom would be even more attractive for the chip giant. First off, such an agreement would require more customized work on Broadcom’s end. In turn, Broadcom would need to receive compensation for this added work, likely leading to a higher-margin revenue stream than the TPU deal.

Margins could also improve since Google may not be part of the partnership. To the extent that there is a revenue-sharing agreement within the TPU deal between Broadcom and Google, a direct Broadcom-Anthropic partnership would remove this dynamic. This would allow more value to flow to Broadcom itself. Still, the exact financial details of the TPU deal are unknown, making this potential benefit difficult to quantify.

Additionally, when Broadcom co-develops chips with a buyer, the partnership is typically multi-year. While the company already has a multi-year TPU deal in place with Anthropic, a fully custom-built solution is a different animal. Such a deal would likely deepen Broadcom’s relationship with Anthropic beyond what the firms have already agreed to. With Anthropic being one of the fastest-growing AI companies in the world, this would be highly advantageous for Broadcom.

Despite all of this, it is by no means certain that Broadcom would actually win a deal to develop an Anthropic chip. Anthropic also has a very strong relationship with Amazon. Amazon has invested $8 billion in Anthropic, with the company using Amazon’s Trainium chips within its infrastructure. This creates the potential that Marvell, Amazon’s custom chip partner, could win a deal to develop Anthropic’s chip.

Anthropic’s Potential Custom Chip: All Smoke, No Fire at This Point

It is important to understand that Anthropic’s custom chip may never become a reality. Still, it's worth noting the potential benefits that could accrue to Broadcom or Marvell if it does. Furthermore, these companies are not the only custom chip developers in the world. Thus, competition for a potential deal doesn’t end with them.

However, the links between Broadcom and Marvell to Anthropic are the strongest. This is particularly true of Broadcom, given that Anthropic has announced partnerships directly with the company. Anthropic’s looser relationship with Marvell is a product of its relationship with Amazon.