Marvell gives Google an option to buy a $12.2 billion stake as part of an expanded AI chip deal

Marvell Technology has granted Google a warrant to purchase up to 58,970,907 shares of its stock — worth roughly $12.2 billion if fully exercised — as part of an expanded custom chip partnership between the two companies, according to a securities filing made public August 19. Marvell shares rallied nearly 10 percent on the news, while rival chipmaker Broadcom fell about 5 percent the same day.

How the Deal Is Structured

Under the warrant, Google can buy Marvell shares at $206.58 apiece. The right to purchase vests in tranches tied to chip purchasing milestones: roughly 1.4 million shares vest in the deal's first year, with the remainder vesting over time as Google buys every additional $500 million worth of chips from Marvell. If Google exercises the warrant in full, it would become the fifth-largest shareholder in Marvell. The stake option is tied to purchasing targets extending through fiscal year 2033, and Marvell has said the arrangement could generate roughly $120 billion in revenue for the company over that period if Google hits those targets.

What Marvell Is Building for Google

Marvell said the expanded agreement covers products that "attach to the tensor processing unit ecosystem" — Google's line of custom AI accelerator chips — including AI inference accelerators, storage controllers, network interface controllers, and near-memory computing technologies. The partnership builds on a relationship that first drew market attention in April 2026, when The Information reported Google was in talks with Marvell to build new AI chips, including TPU and memory processing components.

Part of a Broader Custom Silicon Race

Google, along with fellow hyperscalers Amazon, Meta, and Microsoft, has spent recent years developing custom silicon for AI workloads in an effort to reduce reliance on Nvidia's GPUs, which remain expensive and supply-constrained relative to demand. Google has historically worked primarily with Broadcom on its custom chip designs, expanding that partnership as recently as April 2026 alongside a related deal with Anthropic. The new equity-linked Marvell agreement signals Google is now diversifying its custom-silicon supply chain across two major chip design partners rather than relying on Broadcom alone.

The stock market reaction reflected that shift directly: Marvell's roughly 10 percent gain and Broadcom's roughly 5 percent decline suggest investors read the deal as redistributing a meaningful share of Google's future custom-chip spending away from its long-time primary partner.