Marvell gives Google option to buy $12.2 billion stake in custom chip deal

Marvell Technology said on Wednesday it has issued Alphabet’s Google a warrant to buy a stake worth about $12.18 billion as part of ‌a deal ⁠to ⁠help develop custom chips for the search giant.

Shares of the custom chipmaker jumped more than 11% in premarket trading, while larger rival Broadcom was down over ⁠3%.

Demand for ‌custom chips such as Google’s tensor processing units (TPUs), ⁠used for AI workloads, has surged in recent years as businesses seek alternatives to Nvidia’s pricey graphics processors.