SoftBank Blinks, Broadcom Stalls: OpenAI’s Big Week Gets Bigger for the Wrong Reasons

OpenAI is simultaneously running one of the most ambitious infrastructure buildouts in tech history and struggling to fund it. The company has committed to hundreds of billions in compute spending, closed a $122 billion funding round at an $852 billion valuation, and is racing to ship models fast enough to stay ahead of Anthropic and Google. This week, two separate financing deals linked to that buildout hit public turbulence — one involving a custom chip agreement with Broadcom, the other a loan SoftBank is trying to raise against its own OpenAI stake. The two situations are unrelated in structure but connected in what they reveal: at the scale OpenAI is operating, capital is not flowing as freely as the ambition requires.

OpenAI is facing two separate and distinct financing problems this week, both made public within 24 hours of each other.

The first involves its chip ambitions. OpenAI’s October 2025 agreement with Broadcom to procure 10 gigawatts of custom AI chips is running into a financing snag. According to The Information, which cited an internal memo and people involved in the talks, the negotiations have stalled over an $18 billion financing requirement for the deal’s first phase. Broadcom has said it will only finance that phase if Microsoft agrees to buy roughly 40% of the chips. Under the proposed arrangement, Microsoft would install the chips in its data centers and then rent them back to OpenAI.

The deal, codenamed Project Nexus, aims to produce a custom inference chip called Jalapeno to power ChatGPT. The broader agreement was designed to reduce OpenAI’s dependence on Nvidia hardware. The original Broadcom agreement, unveiled in October 2025, sketched a hardware buildout pegged at roughly $500 billion, spanning chips, networking, power, and data center capacity.

Broadcom had long insisted that OpenAI put up one dollar for every dollar it provided in financing, a standard arrangement to limit vendor risk. It has since relaxed that requirement and agreed to invest more capital upfront than OpenAI, breaking from its long-held position.

The second problem is a different transaction entirely. SoftBank has downsized plans for a $10 billion margin loan backed by its OpenAI stake after facing hesitation from some creditors. In separate discussions with potential lenders in recent weeks, SoftBank and bankers helping it seek the loan have mentioned targeting an amount as low as $6 billion. The pullback reflects hesitation from potential lenders — including private credit firms, banks, and hedge funds — over the challenge of valuing OpenAI, which remains a private company. Discussions have been ongoing since mid-March.

These are not the same deal. The Broadcom situation concerns infrastructure financing for chip production. The SoftBank situation concerns a margin loan collateralized by SoftBank’s equity stake in OpenAI. What connects them is a common constraint: the capital markets are struggling to price and underwrite risk at the scale OpenAI’s AI buildout demands.

The financing strain is not occurring in a vacuum. OpenAI has been in the middle of several significant developments this week.

Greg Brockman, OpenAI’s co-founder and President, testified in the ongoing Musk v. Altman trial on May 5 and told the court that OpenAI expects to spend $50 billion on computing power in 2026 alone. Brockman noted that the company’s computing costs have surged from roughly $30 million in 2017 to tens of billions of dollars this year as OpenAI develops more advanced AI models and serves them to a wider audience.

On the enterprise side, OpenAI raised more than $4 billion from investors including TPG, Brookfield Asset Management, Advent, and Bain Capital for a firm focused on helping businesses deploy its AI software — part of a broader $10 billion joint venture targeting enterprise AI adoption.

On the product side, OpenAI released GPT-5.5 Instant as ChatGPT’s new default model on May 5, with the company reporting that it produced 52.5% fewer hallucinated claims than GPT-5.3 Instant on high-stakes prompts covering medicine, law, and finance. OpenAI also released three new voice models into its API, with one handling live translation across 70 languages.

The Broadcom deal has three realistic paths forward, as reported by The Information: restructure the financing tranche, find replacement lenders, or scale back the chip rollout. Each path will shape how much of OpenAI’s 2026 AI capital expenditure goals it can meet. A commitment from Microsoft to purchase the chips would unlock the deal, but Microsoft recently ended its revenue-sharing arrangement with OpenAI, signaling a more cautious financial posture toward the partnership.

For the SoftBank loan, the challenge is structural: OpenAI remains a private company, and lenders have found it difficult to agree on how to value its equity as collateral. Until OpenAI completes its anticipated transition to a for-profit structure and moves toward an IPO — a timeline that remains contested internally, with Sam Altman targeting Q4 2026 and CFO Sarah Friar preferring 2027 — this valuation uncertainty is unlikely to disappear.

What the week’s events collectively show is that the capital formation challenge for OpenAI is no longer theoretical. It is showing up in specific deals, specific dollar amounts, and specific counterparties who are pausing before they commit.