So, now the key question is: does the deal make Marvell a better AI stock to buy than Broadcom? Let\u2019s take a closer look \u2013\u00a0\u00a0<\/p>\n
Google\u2019s Marvell Deal Challenges AVGO\u2019s AI Chip Dominance\u00a0<\/p>\n
For quite some time, Alphabet-owned Google and other blue-chip companies have been developing custom AI chips to find more cost-effective alternatives to NVIDIA Corporation\u2019s (NVDA Quick QuoteNVDA<\/a> – Free Report<\/a>) \u00a0advanced chips.\u00a0\u00a0<\/p>\n Alphabet\u2019s Google has primarily collaborated with Broadcom to develop its custom chips. In April, Broadcom confirmed that it had extended its partnership with Google through 2031, under which it will provide the company with tensor processing units (TPUs) and networking equipment.\u00a0<\/p>\n However, Google recently entered into a partnership with Marvell focused on TPUs, including accelerators, storage and network interface controllers. The Google AI chip deal allows Marvell to sell up to $12.2 billion in shares to Google.\u00a0\u00a0<\/p>\n The partnership and Google\u2019s warrant expand Marvell\u2019s hyperscaler customer base and bolster its long-term growth prospects. The strategic deal aligns Google\u2019s interests with Marvell\u2019s growth ambitions and establishes the latter as a key supplier of custom AI silicon to hyperscalers, a role the company has pursued for years.\u00a0<\/p>\n But the deal with Marvell doesn\u2019t mean that Google is moving away from Broadcom. It simply means Google is looking for more than one custom-chip partner. Still, the deal could reduce Broadcom\u2019s share of Google\u2019s future AI-chip spending, potentially weigh on its business and create a competitive challenge for the company.\u00a0<\/p>\n After Google\u2019s Deal, Is Marvell a Better Buy Than Broadcom?\u00a0<\/p>\n Google\u2019s partnership with Marvell to diversify its custom AI-chip supply chain has strengthened Marvell\u2019s position as a key supplier of custom AI silicon to hyperscalers, while posing a competitive threat to Broadcom.\u00a0\u00a0<\/p>\n Broadcom remains heavily dependent on AI-related spending, and its relatively concentrated AI customer base could leave it vulnerable to a slowdown in AI infrastructure investment or weaker demand from hyperscalers.<\/p>\n Following the announcement, Broadcom\u2019s share fell roughly 5% on Wednesday as investors remained concerned about its position with Google. On the other hand, Marvell\u2019s shares jumped more than 9% as the deal has given the company a much larger role in the rapidly expanding AI-chip market.<\/p>\n Moreover, Broadcom\u2019s debt-to-equity ratio of 71.5% far exceeds Marvell\u2019s 27.2%, indicating greater financial leverage and possibly higher downside risk if economic conditions worsen.<\/p>\n Image Source: Zacks Investment Research<\/p>\n So, all things considered, Marvell appears to be the more attractive buy following the Google deal, positioning it for sustained growth as demand for custom AI silicon continues to increase. As a result, Marvell\u2019s expected earnings growth rate for the current year is 42.3%. The Zacks Consensus Estimate of $4.05 for MRVL\u2019s earnings per share is up 19.8% year over year.<\/p>\n Image Source: Zacks Investment Research<\/p>\n![\"Zacks](\"https:\/\/www.europesays.com\/ai\/wp-content\/uploads\/2026\/08\/178583.jpg\"\/)
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