SpaceX as Nvidia’s Dominant Customer, Broadcom’s Sandbagging, Credo vs Marvell in Scale Up, SpaceX vs ASTS

SpaceX as Nvidia’s Dominant Customer

Elon gave a number of indications of the amount of capacity SpaceX will be deploying:

“We expect to end this year with over 2 gigawatts of compute. And probably our cumulative compute online by the end of next year will be several times higher. So it may, let’s say, be closer to 10 gigawatts of compute than 5 gigawatts of compute.”

And the company is looking to far exceed that number in terms of available power they’re planning to have online; which is the best indicator for how much capacity they’re planning to add subsequently:

“So we’re actually aiming to far exceed that gigawatt number in terms of power online, power cooling and electrical equipment. So our tentative target is to actually have 20 gigawatts at the power and cooling level online by the end of next year. Now I don’t think we’re going to achieve 20 gigawatts, but we want to have a series of projects that cumulatively come to 20 gigawatts by the end of next year. Some of them won’t pan out exactly on time, but I would expect that we still probably have at the power plant level, something close to 15 gigawatts. Assuming that maybe 1/4 of the projects take longer than expected. So our goal is to have far more power, cooling and electrical equipment than we have GPUs. That’s a logical thing to do given the relative expense of GPUs versus balance of system.”

So, SpaceX will probably install around 6GW of AI compute in ‘27 and then another 8GW or so in ‘28. This gets us to 16GW of cumulative AI capacity by the end of ‘28.

We also know that SpaceX has Nvidia as its exclusive provider and that Nvidia makes $25 billion per GW on Blackwell and $40 billion per GW on Vera Rubin. So, combining all numbers above, we can work out that SpaceX will contribute around 35% to Nvidia revenues in the coming years:

Some have speculated that Nvidia has given discounts in order to obtain this exclusive partnership, however, as Nvidia guided for 72-73% gross margins in calendar ‘27, we know that they aren’t doing much discounting. So, we think that Jensen simply ensures that SpaceX gets the hardware whenever they need it. And as soon as Jensen has the latest product available—Vera Rubin currently—we can also be sure that SpaceX is a preferential customer who gets first access.

Using the same methodology as above, we let OpenAI Astra estimate Nvidia’s full revenue split for calendar 2027 based on what each customer has been announcing in terms of capacity additions on its latest calls. Astra’s numbers for SpaceX are fairly close to ours:

Thus, Nvidia’s outlook in the coming 3-5 years is becoming reliant on the success of SpaceX. However, long term, it’s well possible that SpaceX will be looking to design its own data center silicon as well. Musk’s other business, Tesla, is already designing its own inference chip for self-driving and Optimus, and has in the past also designed its own Dojo data center chip.

SpaceX and Tesla are even looking to build their own ‘Terafab’ to build their own memory and silicon. The initial R&D fab will be a unique building in the world, where the full loop of all manufacturing processes for a modern chip package can happen under one roof. The goal is very fast product iteration. This is Elon discussing how SpaceX-Tesla is looking to get a competitive advantage when it comes to silicon design:

“We’ve placed equipment orders for our development fab in Austin. And that development fab is pretty cool because it’s intended to have lithography mask production, logic, memory, packaging and chip testing all under one roof. So you can have a very fast iterative cycle and try out new chip designs very quickly and see if they work. I don’t think such a building exists anywhere on Earth. So this is really going to be super helpful as we try some exciting, adventurous, high-risk, high-payoff bets on AI chips.”

Broadcom’s Sandbagging?

After the breakdown of Nvidia’s revenues per customer, we then tried a similar exercise for Broadcom. Also here it’s actually fairly easy to get the customer mix as Hock Tan told us what they are looking to ship in ‘28:

“Moving on to Anthropic, starting with the 1 gigawatt of Ironwood we are deploying in 2026. We expect Anthropic to deploy another 5 gigawatts of TPU version 8i in 2027. And in 2028, we have clear line of sight to deliver an incremental 10 gigawatts, even as we expect Google to grow for us. Anthropic is on track to become our largest XPU customer in 2027 and sustain that in 2028. For OpenAI, Jalapeno is on track for the planned deployment of 1.3 gigawatts in 2027. Together with OpenAI, we are deep in development of the next-generation XPU beyond Jalapeno, which is approaching tape-out. In 2028, we have line of sight for OpenAI to deploy over 5 gigawatts of Jalapeno and its successor generation of XPU, which would make OpenAI our second largest XPU customer. In addition, we are in development with OpenAI on their third-generation XPU. As OpenAI announced last week, Jalapeno outperforms the Grace Blackwell Ultra in performance per watt, latency, throughput and power and it’s actually comparable to Vera Rubin GPUs in running OpenAI workloads. The lesson here is when you co-develop a chip that is optimized for your particular LLM workloads, you will outperform any GPU. Like TPUs, Jalapeno demonstrates that it can also run other frontier models and you can do all this at half the cost of a GPU.Our partnership with Meta to deliver multiple generations of MTIA XPUs remains on track. Between now and the end of 2027, we will be delivering 3 generations of MTIA accelerators to Meta. Across these 3 generations, we have line of sight to deploy 3 gigawatts through ‘28.Our content in AI, as you know, goes beyond XPUs. We’re the leader in AI networking, and we continue to extend our lead. In sum, we continue to invest and invest heavily to provide the broadest and most leading-edge AI portfolio. In fact, our AI networking revenue is expected to grow just as fast as XPUs over the next few years.”

If we add all those numbers up, we can see that Broadcom is planning to ship 17GW in ‘28 (Anthropic: 10GW, OpenAI: 5GW and Meta: 2GW). Broadcom recently guided to be making “$20 billion to $30 billion” in revenue per GW. So, if we take the midpoint here at $25 billion per GW, we arrive at $425 billion in potential AI revenue in ‘28. The company is only guiding for $230 billion in AI semiconductor revenue for that year. Based on the bottom-up GW shipments they’ve disclosed, there is a lot of upside to overall guided revenues.

And the above bottom-up numbers don’t include the shipments to Google—if we add in Google as well, we get to $475 billion in potential revenue:

Whereas the dominant debate topic over the last year for Broadcom has been the company’s market share in upcoming TPU generations with Google, the bigger question is how much AI silicon the company will be shipping to Anthropic and OpenAI in the coming years. The overall risk is that there will be delays in shipments, however, based on the above math, it looks to us that Broadcom is building in a lot of conservatism in their guidance and with substantial opportunity to surprise on the upside.

The above calculations make it very clear that Nvidia is becoming heavily exposed to the neocloud market, and especially SpaceX, whereas Broadcom has very high exposure to Anthropic and OpenAI. Thus, who will win the race in frontier AI is becoming a crucial question for semi investors. If Grok 5 will blow everyone out of the water or if open-source models take token share, this is good news for Nvidia. However, if Anthropic and OpenAI continue to dominate the market in terms of revenue share, this is obviously a massive positive for Broadcom.

Out of the two, our top pick would be Broadcom here. In our view, OpenAI and Anthropic are by far the best positioned companies when it comes to monetizing frontier AI, and Broadcom is the clear play on these two building out AI infrastructure. We continue to hold Nvidia as well but we’ll reduce our holding here, and then increase the position in Broadcom.

Next, we’ll dive into the following topics:

• Credo vs Marvell in Scale Up Optics
• A detailed update on SpaceX
• SpaceX vs ASTS

Credo vs Marvell in Scale Up Optics