To The Moon

Broadcom shares $Broadcom(AVGO)$  rose approximately 4.5% yesterday. During an earnings conference call, Meta CFO Susan Li informed investors that the company plans to expand its use of chips co-designed with Broadcom, known as Meta’s Training and Inference Accelerator (MTIA).

“We’re optimizing costs by deploying our custom MTIA silicon in areas where it enables more efficient computing tailored to our unique workloads,” Li stated, according to an S&P Global Market Intelligence transcript.

In 2024, Meta began using MTIA for ranking and recommendation inference workloads related to ads and organic content. The company anticipates increasing MTIA adoption for these applications throughout 2025 before extending its custom silicon efforts to training workloads in 2026.

The first-generation MTIA features 64GB of off-chip LPDDR5 memory, while the next-generation version will utilize 128GB. As servers transition to higher-end chips with greater power demands$GE Vernova Inc.(GEV)$ , memory$Micron Technology(MU)$  requirements will rise, along with increased use of HiWire Active Electrical Cables (AECs) $Credo Technology Group Holding Ltd(CRDO)$   for interconnects. The shift to more powerful chips will increase energy consumption, particularly affecting power companies and potentially boosting the demand for nuclear energy as a stable, high-capacity source. Data centers and consumer electronics will drive this demand, necessitating upgrades or expansions in power grid infrastructure and possibly a diversification of energy sources. While nuclear energy$Oklo Inc.(OKLO)$  could see a resurgence due to its low-carbon footprint and capacity to meet base load demands, there's also a focus on improving chip efficiency to mitigate energy use. This scenario poses challenges in managing increased loads but also offers opportunities for innovation in both energy production and semiconductor technology.

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