Nvidia is investing $2 billion in Marvell Technology and partnering on silicon photonics and AI networking, sending Marvell shares up 13 percent.
Nvidia said Tuesday it is taking a $2 billion stake in Marvell Technology and opening its platform to allow Marvell to integrate custom artificial intelligence chips and networking equipment — a deal that sent Marvell shares surging 13 percent.
The two chipmakers also agreed to collaborate on silicon photonics, a technology that uses light rather than traditional copper wiring to transmit data faster and at lower energy costs, and to explore ways to better harness telecommunications networks for AI computing.
Shares of Marvell rose $11.25 to $99.05 in New York trading Tuesday, the stock’s largest single-day gain in more than three weeks. Nvidia shares climbed 5.6 percent to $174.40.
The investment deepens a partnership Nvidia first signaled last May, when Chief Executive Jensen Huang said the company would open its AI server ecosystem to select partners — including Marvell — allowing them to deploy customized chips for data center customers. Nvidia has made several billion-dollar investments across the AI supply chain in recent years as it works to consolidate its dominance in the sector.
Marvell has sought to carve out a position in the AI spending boom, helping cloud computing companies including Amazon design custom chips for AI workloads. But those products have not achieved the scale of Nvidia’s processors. The company has found more consistent success supplying the networking infrastructure that connects chips inside data centers.
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Silicon photonics has drawn growing interest from AI hardware developers as a potential solution to the industry’s mounting power demands. By speeding data transmission while consuming less energy, the technology could help ease the enormous electricity requirements associated with running large AI systems. In December, Marvell acquired Celestial AI, a Santa Clara, California-based startup focused on silicon photonics.
Marvell Chief Executive Matt Murphy, speaking in a CNBC interview Tuesday, said he did not view the arrangement as competitive with Nvidia’s core business. “Companies such as Nvidia and Marvell are together building and expanding the entire market,” he said. Huang, in the company’s written statement, said the partnership would allow customers to better use Nvidia’s AI infrastructure ecosystem.
