Broadcom seeks $100B to keep the AI chip boom alive

Broadcom is negotiating to secure over $60 billion, possibly up to $100 billion, to support the production of AI chips for Anthropic and its other clients. This transaction highlights the reality of how the development of AI across the world is being financed by loans rather than company funds.

Debt, not cash, is bankrolling the chips

The financing being discussed will be divided into various portions. One of these includes the junior debt portion estimated at about $30 billion. According to reports, Broadcom is also expected to guarantee part of its senior secured debt portion worth approximately $60 billion to $70 billion. The total amount of financing that will be raised is expected to reach $100 billion.

A special-purpose vehicle would issue the debt, keeping it off Broadcom’s own balance sheet. Blackstone and Apollo Global Management, two of Wall Street’s biggest private-credit firms, are also in talks to participate.

This is not a one-off transaction. Goldman Sachs Research predicts total debt issuance associated with AI could reach just under $500 billion by 2026. Credit strategist Amanda Lynam put it succinctly:

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