Marvell Technology and Google expanded their semiconductor agreement to include AI inference accelerators and memory and storage controllers for the Google Tensor Processing Unit ecosystem. Under the terms, Marvell issued a warrant for up to 58,970,907 shares of common stock at an exercise price of $206.58 per share, totaling $12.2 billion. Most of the warrant vests in 240 equal tranches tied to Google generating $500 million in custom product revenue for Marvell through fiscal 2033, while 1,360,867 shares vest on a fixed quarterly schedule in the first year. Marvell shares rose more than 13% in pre-market trading.
Broadcom shares fell nearly 5% following the disclosure of the expanded partnership. The deal comes as custom silicon gains market share; JP Morgan projects total AI accelerator shipments will rise 43% to 23.3 million in 2027, with custom chips from Google and Amazon pushing the segment to a 53% majority unit share.
Key sources
- SOURCE@techmeme“Marvell granting Google a warrant to buy up to 58M+ shares at $206.58 each, totaling up to $12.2B”x.com
- SUPPORT@firstadopter“including AI inference accelerators, storage controllers, network interface controllers, memory interface controllers, and near-memory compute”x.com
- SUPPORT@stockmktnewz“The remaining shares vest in 240 equal tranches, one tranche for every $500 million in Custom Products revenue Google generates for Marvell through fiscal 2033”x.com
- SUPPORT@stocksavvyshay“$MRVL up over 13% after issuing $GOOGL warrants for up to 7% of the company”x.com
- SUPPORT@wallstengine“Broadcom $AVGO is under pressure after Marvell disclosed an expanded Google custom-chip partnership”x.com
- SUPPORT@beth_kindig“JP Morgan projects total AI accelerator shipments to rise 43% to 23.3 million, with strong growth from Google $GOOG and Amazon $AMZN pushing custom silicon to the majority unit share at 53%”x.com
- SOURCE@wesroth“one tranche vests for every $500 million in custom-product revenue, across 240 tranches effectively creating incentives for as much as $120 billion in purchases through fiscal 2033”x.com
- SUPPORT@hardwarebusters“Broadcom lost a monopoly”x.com