Broadcom Faces Competition as Google Negotiates Two AI Chips with Marvell
Google is negotiating with Marvell Technology to co-develop a memory processing unit and a new TPU for AI tasks, potentially reducing reliance on Broadcom’s custom chip partnership. Following the report, Marvell shares spiked 7% premarket, while its P/E ratio stands at 33.35 versus Broadcom’s 27.84.
1. Google Seeks AI Chip Diversification
Google is in talks with Marvell Technology to co-design two specialized processors—a memory processing unit to complement its TPU and a new inferencing TPU—aimed at running AI models more efficiently and reducing dependence on external suppliers.
2. Broadcom’s Custom Chip Business Under Pressure
Broadcom currently partners with Google on TPU development and extended a $2.3 billion AI processor deal with Meta last year, but Google’s move to diversify threatens to shift significant AI workload volume away from Broadcom.
3. Market Valuation and Stock Impact
Following the report, Marvell shares rose 7% in premarket trading, potentially adding over $9 billion to its market cap, while Marvell trades at 33.35 times forward earnings compared with Broadcom’s 27.84.