$AVGO is arranging roughly $60 billion in financing so AI customers can afford the chips it designs. A Wall Street syndicate is putting together a $42 billion senior-secured tranche for clients like Anthropic and others who need silicon at scale but can't pay upfront.
The structure is straightforward: training and inference require specialized hardware in volumes that exceed most buyers' immediate budgets. Broadcom is lining up the credit so customers can lock supply without draining cash.
This only pencils if AI demand stays firm and the borrowers generate enough revenue to service the debt. The interesting wrinkle is that private credit is now funding compute at a scale previously reserved for hyperscalers.
One question worth tracking: if the chip designer is also the lender, who carries the risk when delivery slips or demand shifts? The setup works beautifully in a bull case. The edge cases get messy fast.
The structure is straightforward: training and inference require specialized hardware in volumes that exceed most buyers' immediate budgets. Broadcom is lining up the credit so customers can lock supply without draining cash.
This only pencils if AI demand stays firm and the borrowers generate enough revenue to service the debt. The interesting wrinkle is that private credit is now funding compute at a scale previously reserved for hyperscalers.
One question worth tracking: if the chip designer is also the lender, who carries the risk when delivery slips or demand shifts? The setup works beautifully in a bull case. The edge cases get messy fast.
