Why Broadcom Stock Jumped 12% in October

Core Insights - Broadcom's stock surged 12% in October following a significant partnership with OpenAI to develop custom AI accelerators [1][5] - The collaboration involves a 10-gigawatt AI supply deal, with Broadcom expected to generate substantial revenue from this agreement, estimated between $150 billion and $200 billion [4][9] - The first systems from this partnership are anticipated to be deployed in the second half of 2026, with full capacity expected by the end of 2029 [5] Company Developments - Broadcom will collaborate with OpenAI on designing chips and systems, which will include connectivity solutions [3] - The deal represents a major revenue opportunity for Broadcom, significantly boosting its annual revenue, which was approximately $51 billion in fiscal 2024 [5] - Broadcom has also secured a separate $10 billion deal with another unnamed customer, indicating strong demand for its AI-related products [8] Industry Context - OpenAI has been actively securing AI computing capacity through various large-scale agreements, including a $300 billion deal with Oracle and a $38 billion deal with Amazon [7] - The AI chip market is experiencing a shift as companies seek to reduce reliance on Nvidia, positioning Broadcom favorably within this competitive landscape [8]