Google Strikes $12.2B Custom AI Chip Deal with Marvell

Google and Marvell Technology have entered into a partnership on custom chips that gives Google the right to buy up to $12.2 billion in Marvell shares. [3][5] A securities filing reveals that the technology giant has the option to purchase up to 58,970,907 shares of the chipmaker at a price of $206.58 apiece. [5] The ability to acquire this equity stake is directly tied to specific purchasing targets that run through the 2033 fiscal year. [5]

Following the news of the stock warrant and custom chip deal, Marvell Technology shares rallied nearly 10 percent. [5]

Marvell stated in its filing that the expanded agreement will feature products designed to “attach to the TPU ecosystem.” [5] Specifically, these components will include artificial intelligence inference accelerators, as well as storage and network interface controllers. [5]

In April, Marvell shares experienced a pop following a report from The Information regarding a chip deal with Google targeted at artificial intelligence workloads. [5] That earlier report indicated the collaboration would involve both a tensor processing unit and a memory processing unit. [5]

Historically, Google has largely collaborated with Broadcom to develop its custom chips over the last decade. [5] Broadcom and Google even expanded their existing deal in April. [5] However, Broadcom’s stock fell about 5 percent on Wednesday. [5]

This move is part of a broader industry trend where Google and its megacap competitors, including Microsoft, Meta, and Amazon, are working on custom silicon chips designed for AI workloads. [5] These companies are actively attempting to find cheaper substitutes to Nvidia chips. [5]

The agreement indicates a significant shift in Google's silicon supply chain, introducing a major second player alongside its historical reliance on Broadcom. By securing options for nearly 59 million shares, Google is deeply incentivizing Marvell's long-term alignment with its hardware infrastructure roadmap through 2033. This aligns with broader efforts by megacap companies like Meta, Microsoft, and Amazon to design custom silicon and reduce dependence on expensive Nvidia chips. What the sources don't address: How this new $12.2 billion purchasing arrangement will affect the volume of Google's ongoing custom chip orders with Broadcom over the same period.