Meta disclosed that it spent approximately $500 million on components and design services from Broadcom in 2023.
Meta Platforms has announced the addition of Hock E. Tan, CEO of Broadcom, to its board of directors. Broadcom, known for its networking chips, is a key partner for Meta in its data center initiatives and efforts to design its own chips.
The company also provides services to assist customers in creating their own AI chips. As AI systems require the processing of vast amounts of data, the technology for developing chips that efficiently move and process data has become increasingly important.
In a regulatory filing related to Tan’s appointment, Meta disclosed that it spent approximately $500 million on components and design services from Broadcom in 2023. While Nvidia currently holds the top market share in all-purpose AI chips, major technology companies like Meta, Google, Amazon.com, and Microsoft are also developing specialized custom chips to complement Nvidia’s offerings. Nvidia itself is reportedly courting custom chip clients.
In addition to Tan, Meta also announced that John Arnold, a former energy trading executive at Enron who is now involved in high-voltage transmission line electricity projects, is joining its board of directors.
Hock Tan has used Broadcom as a platform to build a conglomerate of technology companies, which analysts describe as resembling a private equity portfolio focused on cash flow rather than a traditional operating company. Broadcom recently completed a $69 billion acquisition of VMware and subsequently cut about 1,300 jobs.
