SINGAPORE — The chief executives of Intel and Broadcom warned that access to capital could emerge as a major constraint on the artificial intelligence boom, even as demand for computing infrastructure continues to outstrip supply.
Broadcom CEO Hock Tan said financing could become a bigger obstacle to AI expansion than shortages of semiconductors, memory chips or electricity, as the industry races to build the infrastructure needed to power increasingly sophisticated models.
"[What] I think might be the biggest constraint is capital," Hock Tan said at the DBS Asia Future Forward Conference in Singapore on Monday.
Intel CEO Lip-Bu Tan echoed concerns about financing, pointing to the rising cost of capital and questions over whether companies investing heavily in AI will eventually generate sufficient returns.
"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.
Their remarks highlight an emerging challenge for the AI industry, which has poured enormous sums into data centers, advanced chips and power infrastructure in anticipation of surging demand for computing capacity.
The warnings come as rising borrowing costs threaten to complicate financing for technology companies investing heavily in AI infrastructure. Higher bond yields could make it more expensive to fund data center construction and chip purchases, potentially putting pressure on the economics of projects that may take years to generate returns.
Hock Tan said the industry has repeatedly encountered supply bottlenecks over the past two years, but expects some of those constraints to ease as production capacity expands.
"[In the] last two years we have seen a series of bottlenecks that keep coming out, but then we overcome it," he said. "Memory shortage today might not be that way a year from now."
He suggested that wafer shortages could ease by 2028 or 2029, while power availability could also improve as new infrastructure comes online.
Despite the financing concerns, both executives remained bullish on near-term demand for AI computing infrastructure.
"There is more demand for compute infrastructure than we can supply," Hock Tan said, adding that the imbalance could persist through 2029 and potentially into 2030.
Intel’s Tan similarly said the industry was unlikely to experience a significant slowdown over the next two to three years, citing growing adoption of AI applications and demand for computing power.
But sustaining that growth beyond the next few years will depend on how quickly businesses adopt AI and whether the technology delivers meaningful economic benefits, the executives said.
Broadcom’s Tan cautioned that demand for computing infrastructure could slow if the adoption of advanced AI models disappoints or improvements in their capabilities begin to plateau.
Lip-Bu Tan, meanwhile, emphasized that companies would increasingly need to demonstrate tangible returns from AI investments through improved efficiency and new business models.