Analysis: Nvidia, TSMC, ASML and Broadcom as AI's chip 'shovel sellers'
An analysis republished by 36Kr (from the WeChat account Tech Business) maps the AI compute supply chain as a power pyramid: Arm's architecture licensing at the top of the value chain, then GPU/ASIC design at Nvidia and AMD plus Broadcom's custom XPUs and networking chips, then advanced-node foundry work at TSMC, all resting on ASML as the sole supplier of EUV lithography. It cites figures including Nvidia's latest-quarter revenue of $96.2 billion with $89 billion from data centers, Broadcom's AI semiconductor revenue of $16.7 billion up 221% year over year, and TSMC's second-quarter revenue of $40.2 billion with 2nm beginning to contribute. The author argues that roughly $725 billion of combined 2026 capital spending by Microsoft, Google, Amazon and Meta fuels a loop in which better chips enable bigger models, which justify larger orders, while warning that these valuations rest on the assumption that AI investment returns will materialize, with supply-demand mismatch and in-house ASIC efforts as key risks.
It reframes the AI race as a highly concentrated chip supply chain, highlighting how capex cycles and customer-designed silicon could hit the valuations of the 'shovel sellers'.