BofA: Marvell-Google Deal Won't Shake Broadcom's Core TPU Share, Still Worth $250B-$350B

According to Chaoxiang Research, BofA Securities said in an August 19 report that Marvell has entered into a new warrant agreement with Google to establish a custom chip partnership, corresponding to up to $120 billion in cumulative procurement from Google, with Marvell set to receive approximately 60 million shares. The market is concerned about damage to Broadcom's share of Google's TPU supply, but BofA believes Marvell's role is limited to XPU peripheral chips, with core compute chips remaining in Broadcom's hands.

BofA expects Google's total capital expenditure over the next five years to reach $1.5 trillion to $2 trillion, with TPU systems accounting for 25% to 30%, corresponding to a total addressable market of $400 billion to $600 billion. Broadcom holds 55% to 60% of the value share ($250 billion to $350 billion), Marvell captures 10% to 20% ($50 billion to $100 billion) through XPU-attach, and MediaTek takes 20% to 30% of cost-optimized chips. BofA maintains a Buy rating on Broadcom with a $530 price target and reiterates Marvell as a top pick in the connectivity chip space with a $365 price target.

[TechFlow]