Following OpenAI’s announcement of plans to develop its own AI chips, tech giant Apple has recently been reported to be jointly developing AI chips with Broadcom.
Interestingly, both companies gave almost identical reasons for this move: to avoid dependence on NVIDIA. In fact, “diversifying chip sources” is part of Apple’s ongoing AI strategy.
Broadcom seems to have become the recent “darling” of the AI hardware sector, partnering with two leading AI companies in just over a month. Reportedly, Broadcom holds over 80% of the AI ASIC market share, with its AI revenue expected to reach over $17 billion in fiscal 2025, representing year-over-year growth exceeding 40%.
Following the news of the Apple partnership, Broadcom’s stock price rose 6%, while Apple’s stock also saw a brief uptick. This isn’t their first collaboration – in May 2023, Apple announced a partnership with Broadcom to develop 5G RF components and other technologies.
▲Source: YouAnalytics
According to “The Information”, Apple’s AI chip is codenamed “Baltra” and will use TSMC’s advanced N3P process, with mass production planned for 2026. This timeline coincides with OpenAI’s AI chip production schedule.
Reports indicate that Baltra’s design and development aims to optimize AI workloads and enhance AI and machine learning (ML) capabilities. This chip will be dedicated to inference tasks, processing new data, and transmitting it to large language models (LLMs) for output generation.
The focus of this Broadcom collaboration is integrating its high-performance networking technology with the chip’s core processing capabilities to ensure low-latency communication required for AI operations.
▲Source: Crypto Briefing
Recently, Broadcom showcased an advanced 3.5D system-level packaging technology (3.5D XDSiP) that allows manufacturers to exceed traditional reticle size limitations.
Specifically, 3.5D XDSiP stacks compute chips on a logic chip connected to high-bandwidth memory (HBM), while distributing other I/O functions to a separate set of chips.
Unlike traditional 3.5D packaging, Broadcom’s design uses a “face-to-face” approach, allowing denser electrical interfaces between chips through hybrid copper bonding (HBC), enabling higher chip-to-chip interconnect speeds and shorter signal routing.
Broadcom’s 3.5D XDSiP technology is essentially a “blueprint” that customers can use to build their own multi-chip processors. Coincidentally, Broadcom expects the first components using this technology to enter production in 2026, aligning with “Baltra’s” production timeline.
▲Source: The Register
Undoubtedly, this chip’s most important mission is to serve Apple’s own Intelligence services.
Apple’s native AI features have drawn attention since their launch. Apple initially planned to run most AI functions directly on devices, but certain features (like Siri and Maps) are processed in the cloud and demand high computing power, with existing chips not being customized. Thus, the “Baltra” proposal emerged.
Baltra is custom-designed for Apple’s own data centers, driving advanced AI tasks and ensuring a “seamless” AI experience for users. This indicates Apple’s AI strategy has expanded beyond edge computing to include cloud computing capabilities.
Notably, Apple just released iOS 18.2, which includes several practical AI features, including ChatGPT’s official arrival across Apple’s ecosystem. In the future, Baltra will give Apple performance advantages and greater flexibility in deploying AI across its product ecosystem.
▲Source: Fast Company
The AI server chip market is estimated to reach $45 billion by 2028, and Apple’s positioning in this market will pose a significant challenge to existing leaders.
Bloomberg analysis indicates that Apple’s partnership with Broadcom further solidifies its dominance in ASIC design. This collaboration is expected to drive Broadcom’s AI revenue growth beyond 2025-2026 and potentially increase its share in Apple’s supply chain.
Additionally, since OpenAI’s release of ChatGPT in December 2022, Apple has accelerated the development of its server chips to maintain competitiveness in artificial intelligence. Apple aims to complete the “Baltra” chip design within 12 months.