OpenAI just revealed a new AI chip to compete with Nvidia.
It’s a major move – just before the company’s Initial Public Offering that’s expected in late 2026 or early 2027.
Two years ago, it would have sounded absurd.
OpenAI is building its own AI chip. And in head-to-head tests, it beat Nvidia.
The chip is called Jalapeño.
OpenAI designed it with Broadcom (Nasdaq: AVGO), and it's built for one job: inference. That's the work of actually running an AI model — every ChatGPT answer, every Codex task, every API call.
Here's what the tests showed.
OpenAI benchmarked Jalapeño against Nvidia's GB300, the top chip on the public leaderboard. Jalapeño won on two measures that matter most: how much AI work it does per unit of power, and how fast it returns an answer.
Independent analysts at SemiAnalysis ran benchmarks in OpenAI's lab. They reported it beating Nvidia on performance-per-watt across nearly every scenario.
OpenAI developed this chip very quickly. From design to tape-out in nine months — one of the quickest advanced-chip cycles anyone has seen. OpenAI even used its own AI models to help design the silicon.
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Now, some fair context. Jalapeño wasn't tested against Nvidia's newest Vera Rubin chips, which just started shipping. It's built for inference, not training — and training is still Nvidia's stronghold. OpenAI has been clear it will keep buying a lot of Nvidia chips.
So why does this matter?
Because inference is the cost that scales with every user. Nvidia (Nasdaq: NVDA) has commanded profit margins as high as 75% on the chips OpenAI buys. Designing its own inference chip lets OpenAI cut that bill, control its own supply, and improve its margins on the exact workload that's growing fastest.
That's the real story here.
OpenAI is no longer just a model company. It's building the full stack — models, software, and now the hardware underneath. It joins Google, Amazon, and Meta in designing custom silicon.
And the timing points straight at the IPO.
OpenAI confidentially filed its S-1 on June 8. A public listing expected later this year or in early 2027 at a valuation above $1 trillion. The knock on the company has always been its enormous costs. Jalapeño is OpenAI's answer — proof it can lower the cost of serving AI and build a business with its own hardware.
For public-market investors, that's a far more durable story.
Here’s how to secure your stake – at a Pre-IPO discount.
Ian Wyatt
Editor, IPO Watch