Jim Cramer, host of CNBC’s Mad Money, called the $63 billion Broadcom Anthropic deal “excellent for all involved.” However, the stock picker said Nvidia would face endless “hectoring” in the media if it struck the same agreement.
Under the deal, Wall Street lenders pay for Broadcom chips that Anthropic then rents. Broadcom also shoulders part of the lenders’ risk, leaving its shareholders exposed to Anthropic’s ability to pay.
How the Broadcom Anthropic Deal Moves Risk Onto Chipmakers
The financing came together over several weeks before Bank of America, Blackstone, Citigroup, and Morgan Stanley announced it on Monday, according to Bloomberg. The money flows through a special purpose vehicle (SPV), a separate entity created for the deal.
The SPV buys Broadcom chips and data center equipment, then leases the hardware to Anthropic.
Broadcom’s AI chips are mostly custom designs for single clients, such as Google’s Tensor Processing Units (TPUs). Nvidia, by contrast, sells standard processors to a broad customer base.
Broadcom also gives lenders residual value support. In practice, the chipmaker covers part of the loss if the hardware is worth less than expected when the leases end.
The package follows an earlier pledge. Broadcom agreed to lend Anthropic up to $42 billion, Reuters reported on October 1, citing the AI firm’s IPO prospectus. Neither report explains how that loan relates to the new bank-funded package.
Meanwhile, lending to Anthropic carries extra risk. Anthropic’s junk credit rating sits one notch below investment grade.
Would Nvidia Really Face Harsher Scrutiny?
Cramer weighed in on the Broadcom Anthropic deal in a post on X on Tuesday.
The comparison holds up. Nvidia has drawn that scrutiny for months. Its shares fell in August when a reported $500 billion Wall Street AI deal surfaced, as critics flagged circular financing.
The term describes suppliers that fund customers, who then buy their products. Critics argue the practice blurs how much real demand exists.
That same month, Nvidia agreed to guarantee up to $105 billion in OpenAI data center leases.
Still, Broadcom faces a similar critique. Commentators note that Broadcom, Amazon, Microsoft, and Google all fund Anthropic, which then spends the money on their services. As a result, part of the cash flows back to the backers.
That critique suggests Broadcom is not fully exempt from the scrutiny Cramer describes.
Chipmakers increasingly act as lenders because AI labs need more hardware than they can pay for upfront. Consequently, the Broadcom Anthropic deal ties chip stocks to the credit of their biggest customers.
That risk extends across the sector. In May, OpenAI reportedly hit a chip financing snag tied to its own Broadcom partnership.
For Cramer, that risk looks acceptable at Broadcom, while the same playbook keeps Nvidia under fire.
