Nvidia and Broadcom’s AI chips will go head-to-head. How they compare.

Subscribe to enjoy similar stories. Nvidia and Broadcom are increasingly being drawn into direct competition as artificial-intelligence companies look for the most cost-efficient way to train and run AI models. Analysts at UBS think demand is growing quickly for Broadcom’s processors as an alternative.

Nvidia has enjoyed several years as the dominant provider of AI chips due to its strength in graphics-processing units (GPUs). However, the growth of Google’s Tensor Processing Units (TPUs)—which Broadcom helped design—has brought the biggest competitive challenge yet. The major change in the market this year is the potential ramping up of TPU sales to external clients.

AI start-up Anthropic has made two major orders for them, totaling $21 billion, and social-media company Meta Platforms is also in talks to use the processors, according to The Wall Street Journal. “Many have turned to TPU as an intermediate alternative to GPU and we believe demand is accelerating significantly," wrote UBS analyst Timothy Arcuri in a research note this week. Arcuri forecasts that Broadcom will ship around 3.7 million TPUs this year, rising to more than five million in 2027.

That would contribute to Broadcom generating AI revenue of around $60 billion in 2026, rising to $106 billion in 2027. By comparison, Nvidia is expected to generate around $300 billion in data-center sales for its fiscal 2027 year, ending in January next year, largely due to GPU sales, according to FactSet. The average selling price of Google and Broadcom’s TPUs is set to be between $10,500 and $15,000, headed for around $20,000 in the next few years, according to the UBS analyst.