CNBC Mad Money host Jim Cramer called Broadcom's $63 billion financing arrangement with artificial intelligence startup Anthropic "excellent for all involved," while arguing that semiconductor rival Nvidia would face unrelenting media criticism if it struck an identical deal.
Structure of the $63 Billion Broadcom-Anthropic Package
Arranged over several weeks before its official announcement on Monday by Bank of America, Blackstone, Citigroup, and Morgan Stanley, the funding flows through a special purpose vehicle (SPV). The SPV purchases custom Broadcom (AVGO) processors and data center equipment, which it then leases directly to Anthropic.
Under the terms of the arrangement, Broadcom provides residual value support to the participating lenders. This obligates the chipmaker to absorb a portion of the losses if the leased hardware depreciates faster than projected upon lease termination. The structure follows a Reuters report from October 1 citing Anthropic's IPO filing, which noted Broadcom had previously pledged to lend the startup up to $42 billion. Credit agencies currently place Anthropic's credit rating at junk, sitting one notch below investment grade.
Key Takeaways
- $63 Billion Debt Facility: Lenders fund an SPV to purchase Broadcom hardware leased directly to Anthropic.
- Depreciation Risk: Broadcom guarantees residual value support, absorbing losses if chip values plunge.
- Nvidia Parallel: Nvidia guaranteed up to $105 billion in OpenAI leases in August following a reported $500 billion Wall Street AI deal.
Circular Financing and Market Reactions
In a post published on X on Tuesday, October 27, 2026, Cramer asserted that despite the positive setup, press outlets would constantly hector Nvidia if it structured a similar arrangement. Nvidia previously faced intense scrutiny in August after reports of a $500 billion Wall Street AI package sparked fears of circular financing—a practice where suppliers fund customers who then purchase their chips, potentially distorting demand signals. That same month, Nvidia agreed to back up to $105 billion in OpenAI data center leases.
Critics highlight that Broadcom, alongside major tech backers like Amazon, Microsoft, and Google, provides capital to Anthropic, which subsequently spends those funds back on their underlying infrastructure. Meanwhile, OpenAI faced its own chip financing complications tied to a Broadcom partnership back in May as suppliers grapple with escalating hardware demand amid broader AI infrastructure spending.
Why It Matters
As AI development costs soar, major chipmakers are increasingly forced to double as financial underwriters, taking direct balance-sheet exposure to unrated or junk-rated AI startups. While vendor financing fuels immediate top-line revenue growth for chip giants, it shifts long-term credit and hardware depreciation risks onto semiconductor shareholders. If AI revenue monetization stalls, chip manufacturers holding residual value guarantees could face substantial write-downs on returned hardware.
