Broadcom is drawing renewed attention following an artificial intelligence (AI) summit held in San Francisco last weekend. Hock Tan, the Malaysian-born immigrant and CEO of Broadcom, has grown the company into the biggest force leading the anti-Nvidia front through aggressive mergers and acquisitions (M&A).
According to companiesmarketcap.com, a U.S. website tracking market capitalization, Broadcom's market cap stood at $1.82 trillion (about 2,669.03 trillion won) as of the 26th, local time. That ranked seventh, behind Nvidia, Apple, Google, Microsoft, Amazon and TSMC. Excluding TSMC, a Taiwanese company, Broadcom ranks as the second-largest U.S. semiconductor company after Nvidia ($5 trillion).
Broadcom traces its roots to a semiconductor products division that Hewlett-Packard (HP) operated starting in 1961. This organization continued for nearly 40 years before being absorbed into Agilent, established in 1999 when HP spun off its semiconductor business division. Kohlberg Kravis Roberts (KKR), the world's largest private equity fund (PEF), and Silverlake Partners acquired Agilent for $2.66 billion in late 2005 and launched it as Avago Technologies, headquartered in Singapore. Avago acquired Broadcom for $37 billion in 2015 and changed its name to Broadcom, the acquired company. Hock Tan was Avago's CEO at the time, and he has led management for 20 years, from Avago beginning in 2006 through Broadcom.
CEO Tan was born in Penang, Malaysia, in 1953 and is a first-generation immigrant who moved to the United States in 1971 at the age of 18. He graduated from the Massachusetts Institute of Technology (MIT) and Harvard Business School.
Like a private equity fund, he grew Broadcom by attaching companies in the same industry to it. He acquired LSI, a system semiconductor specialist, for $6.6 billion in 2014, Brocade, which makes network equipment such as routers and switches, for $5.9 billion in 2017, and VMware, a virtualization platform company, for $69 billion in 2023. Broadcom's market cap, which stood at around $2.7 billion during the Avago era, surpassed $1 trillion in 2024.
CEO Tan also flexibly resolved conflict with the Donald Trump administration. In 2017, during the early period of the first Trump administration, Broadcom sought to swallow Qualcomm for $117 billion. However, President Trump rejected the deal on national security grounds, calling Broadcom a Singaporean company close to China. A few months later, in November 2017, CEO Tan declared alongside President Trump at the White House that he would move Broadcom's headquarters to Silicon Valley in the United States.
At the time of the announcement, CEO Tan drew a smile from President Trump by saying, "My mother would never have imagined that I would stand next to the U.S. president at the White House," and the scene in which President Trump, watching the announcement from behind, responded, "My mother, too (would never have known that I would become president and enter the White House)," became a big topic. At last week's AI summit, where he met with President Lee Jae-myung and others, CEO Tan showed a contrasting personality to Jensen Huang, leaving first with an expressionless face right after the event, but he also demonstrated that he is a person who spares no effort when necessary.
Though he missed out on Qualcomm, the AI boom was a tremendous opportunity for CEO Tan. Broadcom's main business had been networking, but as demand for application-specific integrated circuits (ASICs) optimized for inference surged beginning last year, the chip capabilities Broadcom had built over 60 years began to shine. To counter Nvidia's graphics processing units (GPUs), big tech companies commissioned Broadcom one after another to design their own chips. Broadcom oversees everything from silicon manufacturing, power and thermal management, and memory integration to final foundry (contract semiconductor manufacturing) preparation.
Google, the strongest player in this field, also chose Broadcom. Broadcom is participating in the development of Google's ASIC, the Tensor Processing Unit (TPU). OpenAI also announced in October last year that it would collaborate with Broadcom to develop custom chips, and in June this year OpenAI unveiled its first proprietary inference-only chip, "Jalapeño." OpenAI's rival Anthropic also signed a contract in April this year with Google and Broadcom to secure GW-class TPU capacity. Meta likewise entrusted its design to Broadcom in March this year.
If Broadcom leads the custom semiconductor market, Nvidia's position could narrow. According to Forbes, Nvidia's top-spec GPUs cost $30,000 to $40,000 each, while the custom TPUs Broadcom is involved in can be bought for $12,000, and in inference work, TPU energy efficiency is 67% higher than that of comparable GPUs. At last month's Jalapeño unveiling, CEO Tan also boasted of his technological prowess, saying it "has performance on par with Nvidia's Blackwell chip or Google's TPU."
