Episode summary
High AI Capex Demand a 'Multi-Year' Cycle | Bloomberg Businessweek
Bloomberg Businessweek Daily
· · 39 min · Hosts: Carol Massar, Tim Stenovec, Emily Graffeo · Guests: Mark Gurman, Rudina Seseri, Ed Ludlow, Ellen Wald, Eric Roston
Summary
Broadcom’s expanded deal with Apple through 2031 was framed as more than a routine supplier extension: it gives Broadcom a role in ASIC silicon for multiple generations of Apple products, including chips tied to future AI servers. The host and a guest argued that Apple is shifting from a world dominated by on-device AI toward a more cloud-heavy architecture, where custom silicon matters more and where Broadcom can regain strategic relevance after Apple built more of its own wireless components.
The discussion also pushed back on the idea that AI spending is cooling. A guest said the demand for AI infrastructure remains strong across the stack, from chips to applications, and described the capex cycle as “multi-cycle” and “multi-year.” At the same time, the conversation suggested the market may be re-pricing scarcity and profitability rather than signaling the end of the AI buildout. The host and guests repeatedly returned to the idea that hyperscalers, chipmakers, and vertically integrated platform companies are still competing for the same limited resources, but that the spending wave is not over.
The episode also touched on Apple’s AI roadmap, including a new internal server chip expected around 2027 or 2028, and on the possibility that Apple’s next major consumer push could be smart glasses designed to reshape the glasses market the way the Apple Watch reshaped watches.
Key takeaways
- The host said Broadcom’s expanded Apple deal through 2031 restores Broadcom’s relevance in Apple’s AI supply chain after years of erosion in Wi-Fi and Bluetooth components.
- The guest said Apple is moving toward more cloud-based AI processing, which makes custom ASICs more important than purely on-device chips.
- Rudina Seseri said AI infrastructure demand remains strong and called it a “multi-cycle, multi-year” capex story.
- The guest argued the market is correcting for overestimated scarcity in chips and hyperscaler capacity, not ending the AI investment cycle.
- The host said Apple’s next major consumer bet may be smart glasses, intended to do to glasses what the Apple Watch did to watches.
Notable quotes
“ASIC chips is a type of circuit, a type of silicon that's really geared towards a single purpose. Now, what is a big piece of machinery that you need that has a single purpose”
“I don't know that we're out of the you know capex demand. I think there's a multi multicycle multi-year um level of demand”
“what Apple wants to do is take do the same thing uh to glasses”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. This is Bloomberg Business Week Daily. Reporting from the magazine that helps global leaders stay ahead with insight on the people, companies, and trends shaping today's complex economy.
Plus, global business, finance, and tech news as it happens. the Bloomberg Business Week Daily podcast with Carol Masser and Tim Stenbec on Bloomberg Radio. All right, so let's get to certainly a story that we've been talking about a lot and it feels like two companies got together and they said, "Let's do more for longer.
Um, Bloomberg's Mark German found out that Broadcom and Apple will extend their tie-up in an expanded partnership to 2031 on products that will find their way into quote multiple generations of Apple products. So, let's get to it. He is here in studio.
Made his way to the east coast. He is Mark German, of course, Bloomberg News managing editor for Global Consumer Tech. Good to have you here.
Thanks for having me — On the East Coast. Yeah, it's great. And there's stuff going on. What What is going on? These guys have been working together for a while.
Yeah. Well, speaking of of phones, uh Broadcom, they make chips, all sorts of chips, and Apple and Broadcom have worked together for decades at this point on wireless components. So, for a long time to get your phone to connect to Wi-Fi or to connect to Bluetooth, you were using what's called a combined Wi-Fi plus Bluetooth chip made by Broadcom.
And Apple was the biggest buyer of this chip. It was the biggest revenue source for Broadcom. But a few years ago, Apple decided it's going to go on its own path.
They're going to develop their own Wi-Fi plus a Bluetooth module. It's called the N1.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai capex
- custom silicon
- chip partnership
- extreme weather
- climate risk
Companies and tickers mentioned
- AVGO
- AAPL
- Broadcom
- Apple Inc.
- Glasswing Ventures
- Transversal Consulting
- Atlantic Council
Watch the episode
Watch “High AI Capex Demand a 'Multi-Year' Cycle | Bloomberg Businessweek” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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