Nvidia Price Hike Sparks AI Infrastructure Shake-Up

Nvidia customers may face a significant price hike in early 2027, as memory prices are expected to climb by over 15%. This increase will particularly affect Alphabet, one of Nvidia's largest customers, which is already investing heavily in AI infrastructure. Google Cloud revenue grew 82% in the June quarter to $24.8 billion, and cloud backlog reached $514 billion.

Alphabet has committed $195 billion to $205 billion in capital spending this year on AI infrastructure, with a new partnership with Marvell expected to generate up to $120 billion in custom-chip sales through fiscal 2033. The company's commitment to its own tensor processing units (TPUs) gives it the flexibility to absorb Nvidia price increases and monetize alternatives simultaneously.

Matt Murphy, CEO of Marvell, said his company has 'custom engagements across the board at all the U.S. hyperscalers' and that the custom business alone has a path to over $10 billion in revenue in fiscal 2029. The partnership with Nvidia on silicon photonics and NVLink Fusion allows Marvell to build custom chips and networking semiconductors that can seamlessly interface with NVIDIA infrastructure.