Broadcom Hit by Marvell Deal With Google: What History Says

Broadcom's shares took a hit on August 19 after Marvell Technology announced an expanded custom chip agreement with Google, whose TPU chips Broadcom designs. The drop was about 5%, and investors treated it as their problem because they saw the news as a threat to Broadcom's business relationship with Google.

However, this is not the first time Broadcom has faced a similar situation. In January 2023, Bloomberg reported that Apple planned to drop a key Broadcom chip from its devices by 2025. At the time, Apple accounted for about 20% of Broadcom's net revenue, or roughly $7 billion a year.

Apple did eventually drop the chip, but not before announcing a separate multi-year deal with Broadcom in May 2023 to keep building 5G radio-frequency components in the US. The company then disclosed an agreement extending that chip supply relationship through 2031.

Broadcom's revenue nearly doubled after Apple dropped the chip, from $35.8 billion in fiscal 2023 to $63.9 billion in fiscal 2025, as AI demand overwhelmed other areas of the business.