Marvell Technology shares rose significantly on Monday following a report that Google is in discussions with the chip designer to develop two new chips. These processors are intended to enhance the efficiency of running artificial intelligence models.
The potential collaboration could involve two chips: a memory processing unit and a new Tensor Processing Unit (TPU) specifically engineered for AI applications. This development suggests Google may be looking to diversify its chip suppliers beyond Broadcom, especially amidst escalating demand and alternatives to Nvidia's chips.
Big Tech companies like Google and Meta are actively expanding their custom chip development to reduce reliance on external suppliers. Google currently uses its own TPUs for AI training and inferencing, and has previously partnered with Broadcom for chip design.
This report emerges as Meta recently extended its own deal with Broadcom for AI processors, having paid $2.3 billion last year. Both Marvell and Broadcom are experiencing increased demand for specialized processors powering AI workloads in data centers.
Marvell's market value could see substantial growth if these gains hold, reflecting the heightened interest in advanced AI chip technology.