Marvell and Google sign a $12.2 billion AI deal with a revenue-linked warrant

On 29 July 2026 Marvell Technology, Inc. and Google LLC entered into a commercial agreement to develop custom semiconductor products — AI inference accelerators, storage and network controllers — for Google’s TPU ecosystem (SEC Form 8‑K). On 18 August 2026 Marvell issued Google a warrant to purchase up to 58,970,907 shares of common stock at an exercise price of $206.58 per share, a theoretical value of roughly $12.2 billion if exercised in full (Form 8‑K). According to Reuters, full exercise would make Google Marvell’s fifth-largest investor.

The warrant vests along two tracks: 1,360,867 shares vest in equal quarterly instalments over the first year after signing; the remaining shares vest in 240 tranches, one for every $500 million in “Custom Products” revenue generated by discretionary purchases from Google and its affiliates, starting in Marvell’s third fiscal quarter of 2027 and running through the end of its 2033 fiscal year. The warrant is exercisable, in whole or in part, from the issue date until 18 August 2033, and it cannot be transferred to anyone other than controlled affiliates without Marvell’s consent (Form 8‑K).

The announcement became public on 19 August 2026 with the Form 8‑K filing. Marvell stock rose sharply in response: CNBC reported a gain of about 10% on the day, Reuters put pre-market trading up more than 11%, while TNW noted an intraday peak of around +14% and a close near +8%. The three figures don’t contradict each other — they measure different moments of the same session: pre-market, intraday high and close. Meanwhile Broadcom, Google’s long-standing custom-silicon supplier, shed about 5%, while Alphabet was essentially flat. Reuters points out that Broadcom remains tied to Google by a long-term agreement running to 2031 for future generations of AI chips.

The deal installs Marvell as a second strategic supplier for Google’s TPUs, but the revenue-linked warrant model introduces a dependency on the volume of orders actually placed. Morningstar’s William Kerwin describes “a growing pie at Google for new sources, rather than a competitive displacement of Broadcom”, calling the agreement “a big win for Marvell”. With no official statement from Google, how much market share Marvell can really win remains uncertain, as does the pace of the transition between suppliers.