Marvell-Google AI chip supply deal
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Marvell shares tumble 8 percent despite revenue growth
Marvell's fiscal second-quarter revenue came in $39 million above the company guidance provided in May.
The Google partnership is worth up to $12.2 billion in shares.
Marvell's data center revenue growth accelerated to 46% year over year in the second quarter.
“We believe investor expectations were elevated heading into the quarter based on robust spending at key customers, as well as the previously disclosed Google relationship,”
Marvell announces AI chip deal with Google worth up to $12.2 billion
Broadcom's stock fell about 5% on Wednesday.
Marvell said the expanded agreement will include products that attach to the TPU ecosystem, such as AI inference accelerators and storage and network interface controllers.
The deal allows Google to purchase up to 58,970,907 shares at $206.58 apiece.
“It's a commitment that is very substantial in dollars – a very, very substantial amount of dollars. Now we also accept the fact that, while we like to win every design in that program, we also accept the fact that given the growth of development and consumption of AI compute even by our partner, Google, that we fully expect that there will be some diversity of sources for them. But our commitment from them is a very substantial dollar amount.”
Marvell-Google AI chip deal with equity purchase option
The stake is tied to purchasing targets through Marvell's 2033 fiscal year
Marvell said the expanded agreement includes products that attach to the tensor processing unit ecosystem, such as AI inference accelerators and storage and network interface controllers
Google, Amazon, Meta and Microsoft have been developing custom silicon chips for AI workloads as cheaper substitutes to Nvidia chips
“It's a commitment that is very substantial in dollars – a very, very substantial amount of dollars. Now we also accept the fact that, while we like to win every design in that program, we also accept the fact that given the growth of development and consumption of AI compute even by our partner, Google, that we fully expect that there will be some diversity of sources for them. But our commitment from them is a very substantial dollar amount.”