NEWS | Marvell has given Google the right to buy up to 12.2 billion dollars worth of its stock, tied to a bigger deal for Marvell to build custom AI chips for Google's in house computing systems. Google does not get the shares all at once. It earns the right to buy more as it keeps placing chip orders, unlocking another batch of stock for every 500 million dollars it spends, stretching out through 2033.
Marvell's stock jumped as much as 14 percent on the news. Rival Broadcom, which has been Google's main chip partner since a separate deal signed back in April that runs through 2031, dropped as much as 5.8 percent as investors worried Google now has a real second option for that business.
This fits into a bigger pattern of Google spreading its bets. Demand for Google's custom AI chips has grown so fast that leaning on just one supplier has started to look risky, so Google is now backing two chipmakers instead of one to keep its AI buildout moving without getting stuck waiting on a single company.
Some analysts think this fear around Broadcom losing ground is overblown, since total demand for AI chips is growing faster than either company can build anyway. But the stock swings show how nervous investors still are about anyone falling behind in this AI buildout, even when there may be enough business for everyone.
So here is the real shift worth watching. If Google can just hand out billion dollar stakes to whichever chipmaker builds fastest, does supplier loyalty even matter anymore, or is this just how business gets done in the AI race now?
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