Intel and Broadcom CEOs Warn Capital Could Limit AI Growth

Broadcom Inc. CEO Hock Tan says capital will be the biggest constraint as AI development continues, Reuters reports. Speaking at the DBS Asia Future Forward Conference in Singapore, he said financing could become a bigger obstacle to AI expansion than shortages of semiconductors, memory chips or electricity, according to CNBC. Intel Corporation CEO Lip-Bu Tan pointed to the rising cost of capital and to whether companies investing heavily in AI will see a return. "If there's any challenge in the front, it's capital and the cost of capital, and then the other part is in the longer run, people want to see the ROI," he said.

Hock Tan said the industry has overcome a series of bottlenecks over the past two years. He suggested wafer shortages could ease by 2028 or 2029 and said today's memory shortage "might not be that way a year from now." He said demand for compute infrastructure exceeds what the industry can supply, an imbalance that could persist through 2029 and potentially into 2030.

Lip-Bu Tan said the industry is unlikely to see a significant slowdown over the next two to three years. Beyond that, the executives said, growth will depend on how quickly businesses adopt AI and whether it delivers meaningful economic benefits. Hock Tan cautioned that demand could slow if adoption of advanced models disappoints or their capabilities plateau.

Asked about the impact of cheaper AI models, Hock Tan said many investors "have no clue what they're investing in," likening some of the investment flowing into the sector to "casino gambling," Reuters reports.