Broadcom Unveils New Networking Chip Amid Intensified Nvidia Rivalry
Broadcom has unveiled its latest networking chip, the Thor Ultra, to bolster its position in the growing artificial intelligence (AI) market. This announcement was made during a lab tour in San Jose, California, on September 5, 2025. With this chip, Broadcom aims to compete more fiercely against Nvidia in the AI technology sector.
Thor Ultra: A Game Changer for AI Networks
The Thor Ultra networking chip is designed to facilitate the construction of complex AI computing systems. It allows operators to connect vast numbers of chips, which is essential for running large AI models such as those used in applications like ChatGPT.
- The chip enhances the capability to deploy more chips than previously possible.
- It plays a critical role in facilitating communication within data centers focused on AI.
Expanding Opportunities in AI
Broadcom sees significant potential in the AI market, estimating its value to be between $60 billion and $90 billion by 2027. The Thor Ultra chip is part of a broader strategy to capture this market segment.
- In fiscal 2024, Broadcom reported AI-related revenue of $12.2 billion.
- A recent deal for custom chips with OpenAI is expected to generate substantial revenues starting in late 2026.
Strategic Developments and Competitive Positioning
Broadcom has taken proactive steps to secure its position in the AI landscape. The company recently announced an unnamed $10 billion customer for its custom AI chips.
According to Ram Velaga, a senior vice president at Broadcom, networking plays an integral role in distributed computing systems. Therefore, companies involved in graphic processing units (GPUs) must participate in networking capabilities.
Design and Testing Innovations
The design of the Thor Ultra incorporates significant advancements. Broadcom’s engineering team has doubled the chip’s bandwidth compared to its predecessor. Rigorous testing protocols ensure reliability from the earliest production stages.
- Engineers create comprehensive systems around the chips for optimal integration.
- Collaboration with hardware teams ensures efficient power usage and heat management.
Broadcom’s focus on design is evident; for every dollar invested in silicon, ecosystem partners invest between $6 and $10. This symbiotic relationship is essential for driving the company’s innovations in networking technology and maintaining competitiveness.
As the AI sector continues to expand, Broadcom’s Thor Ultra chip positions the company as a formidable contender against Nvidia, reinforcing its influence in AI networking infrastructure.
