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- Broadcom is arranging more than $50 billion in private financing, with Apollo and Blackstone among the lenders.
- AVGO fell about 1.6% premarket to near $370 on Thursday, October 8, 2026.
- The deal is targeted to close by year-end, and its size could still change.
Broadcom (AVGO) is arranging over $50 billion in private financing with Apollo and Blackstone to fund OpenAI's custom AI chips, and shares slipped premarket.
Lead
Broadcom (NASDAQ: AVGO) is lining up more than $50 billion in private financing to pay for the custom accelerators it is building for OpenAI. Apollo Global Management (APO) and Blackstone (BX) are among the lenders approached. The talks are at an early stage, and the facility is targeted to close before the end of 2026. Broadcom shares fell 1.66% to $370.25 in premarket trading on October 8.What Happened?
Broadcom is acting as arranger of the debt, which would let OpenAI take delivery of chips it cannot yet buy outright. The financing could cover several gigawatts of OpenAI chip capacity.
The chips fall under a partnership announced in October 2025. It calls for 10 gigawatts of custom accelerators, with deployment running from the second half of 2026 through 2029. A purchase of that scale outstrips the balance sheet of a company still building out its revenue base. Private credit lets a third party carry the hardware cost until OpenAI's cloud and product revenue catches up.
Why Did Broadcom Shares Slip?
Broadcom shares slipped because the financing report landed on a weak morning for chip stocks. Premarket, Nvidia (NVDA) fell 1.01% to $235.06, and Marvell Technology (MRVL) stock dropped 2.63% to $277.20.
Three pressures converged. The 10-year Treasury yield sat near 5.33%, and Brent crude traded above $104 a barrel. Samsung Electronics also posted preliminary third-quarter results that missed expectations, even though operating profit rose nearly ninefold to 107.4 trillion won. Higher yields reduce the present value of growth-oriented ai stocks, and they raise the cost of the debt now underwriting AI hardware.
How Does Private Credit Fit Into AI Spending?
Private credit has become a funding channel for AI hardware because public bond markets are close to their limits. Large cloud providers have issued heavily, and newer buyers such as OpenAI and Anthropic lack the financial firepower to purchase chips outright.
Broadcom's request is one of several. SpaceX has held recent talks with lenders about roughly $40 billion to buy Nvidia chips. Oracle (ORCL) is in discussions with Apollo and Goldman Sachs (GS) on a structure in which a separate entity buys the chips and leases them to Oracle. The structure bridges the gap between paying for hardware and collecting cloud revenue. Nvidia chips for a single 1-gigawatt data center would cost tens of billions of dollars. Taken together, the Broadcom and SpaceX proposals approach $90 billion in new financing, before counting Oracle.
Strategic Context
For Broadcom, the arrangement turns a customer's funding constraint into a managed process, which supports the order pipeline behind its custom silicon business. It also ties the company more closely to the credit profile of its customers. If OpenAI's revenue lags the schedule of chip deliveries, the lenders' exposure rests on that gap.
Outlook
The $50 billion facility remains in negotiation, and terms, pricing and size may change before a year-end close. Near term, chip shares will track Treasury yields and oil as much as deal news. The larger question is whether private lenders keep absorbing AI hardware debt at falling spreads. Broadcom's next earnings report will show how much of the OpenAI program has moved into deliveries.
Mentioned tickers: AVGO, NVDA, MRVL, APO, BX, ORCL, GS