Marvell gives Google $12.2 billion stake in custom Ai chip deal, stock surges

Marvell Technology has given Google the right to purchase up to 58.97 million of its shares, a position said to be worth about $12.2 billion if fully exercised, with most of the stake being related to Google’s spending on custom chips until fiscal year 2033.

The deal deepens Google’s push to build its own AI silicon and sent Marvell’s stock surging on Wednesday.

Stake increases with Google’s spending

The warrant carries an exercise price of $206.58 per share and runs until August 18, 2033, according to Marvell’s filing with the US SEC. The chip maker issued it on August 18, even though the underlying commercial agreement was signed weeks earlier on July 29.

However, only a bit of the stake is guaranteed, with about 1.36 million shares vested in equal quarterly pieces over the deal’s first year. The rest, equal to about 57.61 million shares, is spread across 240 segments that unlock one at a time, each triggered by another $500 million in custom-chip revenue that Google generates for Marvell. These segments will run from Marvell’s third quarter of fiscal year 2027 until the end of fiscal year 2033.

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