Tech and Healthcare Investors React to Shifting Dynamics in Chip Market
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We took advantage of this week's rally in healthcare by selling a sliver of our Eli Lilly position at record highs. Broadcom shares are under pressure after Google, its flagship custom chip customer, inked a deal with rival Marvell Technology . The reflex to sell Broadcom on the news is understandable, though we're not heading for the exits yet. Marvell revealed an expansive partnership with Google in a securities filing Wednesday, saying that it "spans a comprehensive range of custom silicon programs that attach to the TPU ecosystem," including components related to memory and storage. Broadcom has co-designed tensor processing units (TPUs) with Google for about a decade. As part of the deal, Marvell also issued stock warrants to Google valued at roughly $12.2 billion.
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ZeroHedgeMRVL is up over 12% in the pre-market... Shares of Broadcom (AVGO), which is known for being a major partner on Google's TPU efforts, are down 3% in the pre-market.
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Marvell Technology shares were rising more than 10% in premarket action on Wednesday after the company announced a new agreement with Alphabet related to custom artificial-intelligence chips.
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ZeroHedgeThe circular financing circus rolls on... Marvell shares are soaring this morning after fabless chip designer announced an expanded chip-development partnership with Google that includes a warrant from Marvell allowing the search giant to buy as much as $12.2 billion in shares.
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Google may purchase as many as 58,970,907 Marvell shares at a price of $206.58 apiece, Marvell said Wednesday in a regulatory filing.
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MarketWatchGoogle will also get the option to purchase about $12 billion worth of Marvell’s stock
3 details only one outlet reported
Independent claims that didn't surface elsewhere in our corpus. Treat as supplementary — not corroborated across outlets.
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01 CNBC The tie-up supports the bear case against Broadcom: that Google will increasingly partner with other suppliers to develop and implement its custom AI compute systems. Investors are responding accordingly on Wednesday, sending Broadcom shares down 5% and on pace for their lowest close since early July. The decline coincides with a down day for the broader chip complex, with the iShares Semiconductor ETF down about 2%. For its part, Marvell shares are jumping about 7% on the news. Broadcom and Google have worked together on TPUs since the chip's early days — it's now in its eighth generation — with Broadcom serving as a co-designer and a key conduit to Taiwan Semiconductor Manufacturing Co. to get the chip blueprints fabricated into real-world products.
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02 ZeroHedge The two firms will collaborate on custom AI chips. "The expanded partnership spans a comprehensive range of custom silicon programs that attach to the TPU ecosystem, including AI inference accelerators, storage controllers, network interface controllers, memory interface controllers, and near-memory compute," Marvell said in the filing.
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03 MarketWatch Tech Stocks Marvell’s stock surges on news of Google chip deal — and Broadcom’s falls
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Sources (3)
- zerohedge
- marketwatch
- cnbc