Speaking in Singapore, Broadcom CEO Hock Tan and Intel CEO Lip-Bu Tan warn that access to capital and rising borrowing costs could become AI's main bottleneck

The cost of building AI infrastructure may rise for any company needing to borrow money for hardware or data centers.

Broadcom CEO Hock Tan and Intel CEO Lip-Bu Tan have warned that access to capital and rising borrowing costs could become the primary bottleneck for the artificial intelligence boom. Speaking at the DBS Asia Future Forward Conference in Singapore, Tan stated that capital, rather than semiconductor shortages or power constraints, might be the biggest constraint for AI expansion. He noted that while the industry has overcome past supply bottlenecks, financing could pose a new challenge. Lip-Bu Tan echoed these concerns, highlighting the increasing cost of capital and the need for companies to demonstrate strong return on investment (ROI) from their AI ventures. Despite these financing worries, both executives expressed optimism about the continued high demand for AI computing infrastructure, projecting that supply may not meet demand through 2029 or 2030.

The CEOs' warnings signal a potential shift in the AI industry's growth narrative, moving from supply-side constraints like chip availability to financial feasibility. This suggests that the sheer scale of investment required for AI, combined with a tougher credit environment, could dictate the pace of innovation and deployment. Companies heavily reliant on external financing for their AI ambitions may face increased scrutiny and a higher hurdle rate for projects to be approved.

This could disproportionately affect smaller players or startups aiming to compete in the AI space, potentially consolidating market power among well-capitalized incumbents. Investors and financial institutions will likely pay closer attention to AI project economics, demanding clearer pathways to profitability and robust ROI justifications. The long-term viability of large-scale AI deployments may hinge not just on technological advancement but also on sustained, affordable access to capital.