Marvell stock rallied after the chipmaker expanded its custom-silicon partnership with Google. MRVL shares closed 9.9% higher at $237.27 on Wednesday.
Broadcom fell 4.6% during the same session as traders assessed a second supplier within Google’s artificial intelligence chip network.
The agreement could support up to $120 billion in qualifying revenue through Marvell’s fiscal 2033. This figure reflects the warrant’s maximum purchase milestones, not a firm order from Google. The announcement comes one week before Marvell reports fiscal second-quarter results on August 27.
Marvell and Google signed the commercial agreement on July 29. The chipmaker will develop products that connect with Google’s Tensor Processing Unit ecosystem. The programs include AI inference accelerators, storage controllers, network interface controllers, memory interface controllers and near-memory computing products.
JPMorgan analyst Harlan Sur said the agreement does not cover Google’s core TPU accelerator. Instead, Marvell’s products support the chips that sit around the TPU. The structure therefore expands Google’s supplier base while Broadcom continues its existing work on Google’s custom processors. JPMorgan kept its Overweight rating and $240 price target on Marvell stock.
Marvell issued Google a warrant for up to 58,970,907 shares at $206.58 each. Full exercise at that price would cost about $12.18 billion. Google could hold roughly 6% of Marvell after exercising every available share, depending on Marvell’s share count at that time.
Only 1,360,867 shares vest through equal quarterly installments during the first year. The other shares vest in 240 equal tranches through fiscal 2033. One tranche becomes available for each $500 million in qualifying custom-product revenue. The arrangement could dilute current shareholders, although Google must meet the purchase conditions before most shares vest.
Marvell reported record fiscal first-quarter revenue of $2.418 billion, up 28% from a year earlier. Data center revenue reached $1.833 billion, representing 76% of total sales. The segment grew 27% year over year and 11% from the prior quarter. Operating cash flow also reached a record $638.8 million.
GAAP net income totaled $34.5 million, or $0.04 per diluted share. Adjusted net income reached $718 million, while adjusted earnings came to $0.80 per share. Chief Executive Matt Murphy said, “We expect revenue growth to continue accelerating each quarter throughout fiscal 2027, driven by continued strength in our data center business.”
Marvell also expanded its connectivity portfolio through the Celestial AI and XConn acquisitions in February. Celestial develops optical links between processors and memory. XConn designs PCIe and CXL switches for processors, accelerators and memory. These products complement Marvell’s custom silicon, Ethernet switching and optical networking business inside large AI data centers.
Marvell will release its fiscal second-quarter results on August 27, followed by a call at 1:45 p.m. Pacific time. Management forecasts revenue of $2.7 billion, plus or minus 5%. The midpoint represents 35% annual growth. It also expects adjusted earnings of $0.93 per share, plus or minus $0.05.
The company forecasts a GAAP gross margin of 52.1% to 53.1% and an adjusted margin of 58.25% to 59.25%. Investors will track management’s Google revenue timetable, custom-chip margins and demand for 800G and 1.6T optical products. Marvell stock also approaches the stated $245 resistance area after Wednesday’s rally.