NVIDIA invests $2 billion in Marvell, bringing its custom chip competitor into its own ecosystem

According to 1M AI News monitoring, Nvidia announced a $2 billion investment in semiconductor company Marvell Technology, and at the same time, it will open up Marvell’s AI server architecture through its NVLink Fusion platform, allowing it to integrate custom AI chips and network devices into Nvidia systems. The two sides will also collaborate on making AI integration progress in silicon photonics (using light instead of copper wires to transmit data, which can significantly speed things up and reduce energy consumption) and in AI-focused 5G/6G telecom networks.

One of Marvell’s core businesses is helping cloud computing giants like Amazon design custom AI acceleration chips—chips that are essentially a substitute for Nvidia GPUs. Nvidia’s move effectively amounts to actively embracing the custom-chip trend: rather than forcing customers to choose between Nvidia GPUs and custom chips, it allows custom chips to run within Nvidia’s infrastructure and ecosystem. Under the collaboration arrangement, Marvell provides custom acceleration chips (XPU) and expansion networking compatible with NVLink Fusion, while Nvidia provides Vera CPU, network interface cards, DPUs, switches, and rack-level AI computing power.

In a statement, Jensen Huang said, “The inference inflection point has arrived—demand for token generation has surged, and the whole world is racing to build AI factories.” Matt Murphy, Chairman and CEO of Marvell, said in an interview with CNBC that he does not think this is a zero-sum game, and that the two companies are jointly expanding the entire market.

This is another multi-billion-dollar investment by Nvidia along the AI supply chain in recent years. In May last year, Huang announced that it would open up AI server architecture to allow multiple partners (including Marvell) to deploy custom chips; this equity investment is a concrete implementation of that open strategy. The silicon photonics partnership is also worth noting: Marvell acquired silicon photonics startup Celestial AI in December last year. After the news was released, Marvell’s stock surged 13% to $99.05, its biggest one-day gain in more than three weeks; Nvidia rose 5.6% to $174.40.