Finance
Marvell Shares Gain on Report of Deal Talks With Google to Develop Two AI Chips
Published by Global Banking & Finance Review®
Posted on April 20, 2026
3 min readLast updated: April 20, 2026
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Marvell shares jumped about 6–7% premarket on April 20, 2026, after reports that Google is in talks to develop two new AI chips with Marvell—a memory processing unit alongside TPUs and a new inference-focused TPU—potentially signaling a strategic diversification in Google’s silicon supply.
Marvell shares gain on report of deal talks with Google to develop two AI chips
Marvell Technology and Google: AI Chip Development and Market Impact
Premarket Surge Following Deal Reports
April 20 (Reuters) - Marvell Technology's shares jumped 6% in premarket trading on Monday following a report that Alphabet's Google is in talks with the chip designer to develop two new chips aimed at running AI models more efficiently.
Details of the Potential Chip Deal
Two Distinct AI Chips in Discussion
The potential deal could involve two distinct chips: a memory processing unit to complement Google's tensor processing unit and a new TPU built for running AI models, The Information reported on Sunday, citing two people with direct knowledge of the discussions.
Big Tech’s Custom Chip Strategies
Big Tech companies such as Google and Facebook-parent Meta are investing heavily to reduce dependence on external chip suppliers by expanding their custom chip efforts amid Silicon Valley's intensifying AI rivalry.
Google’s Current AI Chip Operations
TPUs and Broadcom Partnership
Google deploys TPUs for training AI models and to respond to user queries, a process known as inferencing, and works with Broadcom to design its chips.
Potential Diversification from Broadcom
The report signals that Google might be looking to diversify from Broadcom amid surging demand for its chips as businesses seek alternatives to Nvidia's pricey chips.
Anthropic’s Use of Google-Designed Chips
AI lab Anthropic uses a range of chips, including TPUs designed by Google, to develop and run its AI software and chatbot Claude.
Industry Reactions and Related Developments
Responses from Google and Marvell
Google and Marvell did not immediately respond to Reuters requests for comment.
Meta’s Extended Deal with Broadcom
Last week, Meta extended its deal with Broadcom to produce several generations of custom AI processors. The social media giant paid Broadcom $2.3 billion last year for AI chip design and related services.
Marvell and Broadcom’s Role in AI Chip Design
Both Marvell and its larger rival Broadcom help clients with designing chips, as growing adoption of AI tools boost demand for specialized processors used in advanced data centers.
Financial Impact and Market Valuation
Nvidia’s Investment in Marvell
Last month, Nvidia invested $2 billion in Marvell in an effort to make it easier for customers to use the custom AI chips that Marvell designs with Nvidia's networking gear and central processors.
Revenue Projections and Market Value
Marvell, which expects its revenue to approach $15 billion in fiscal 2028, is set to add more than $7 billion to its market value of $122.15 billion, if the premarket gains hold.
Valuation Comparison: Marvell vs. Broadcom
Marvell trades at 33.35 times the estimates of its earnings for the next 12 months, compared with 27.84 for Broadcom.
Reporting Credits
(Reporting by Jaspreet Singh in Bengaluru; Editing by Arun Koyyur)
Key Takeaways
- •Google is seeking to diversify its custom AI chip suppliers beyond Broadcom by engaging Marvell to co-develop new inference-focused chips, including a memory processing unit and TPU—design finalization expected next year (finance.yahoo.com)
- •Marvell’s stock rose strongly (~6–7%) in early trading, potentially boosting its market value by over $9 billion on a base of $122 billion market cap; its forward P/E (~33.35×) exceeds Broadcom’s (~27.84×) (finance.yahoo.com)
- •The move underscores Google’s multi-supplier strategy amid booming TPU demand and hyperscalers’ push for in‑house chip solutions, while Marvell strengthens its role in the AI chip ecosystem alongside peers like Broadcom (gadgets360.com)
References
Frequently Asked Questions about Marvell shares gain on report of deal talks with Google to develop two AI chips
1Why did Marvell shares increase in premarket trading?
Marvell shares rose 7% in premarket trading following a report that Google is in talks with Marvell to develop two new AI chips.
2What is the nature of the potential Google-Marvell deal?
The deal could involve developing a memory processing unit and a new Tensor Processing Unit (TPU) for running AI models more efficiently.
3How are tech companies like Google changing their chip supply strategy?
Google and others are expanding custom chip efforts to reduce dependence on outside suppliers and meet growing demand for AI hardware.
4Which companies does Google currently work with for AI chips?
Google currently works with Broadcom and designs its own TPUs for training and inferencing AI models.
5What is the analyst consensus and price target for Marvell stock?
Of 44 analysts, the average rating for Marvell is "buy" with a median price target of $125.