Broadcom Vs. Marvell: Custom Silicon is Going to Get White Hot
Broadcom and Marvell both reported blowout AI numbers this summer, but they are chasing the custom silicon boom from completely different angles, and only one of those angles may survive a supply crunch.
Broadcom (NASDAQ:AVGO | AVGO Price Prediction) and Marvell Technology (NASDAQ:MRVL) both reported this summer, and their results point the same way: hyperscalers want chips designed around their own models. Broadcom’s AI semiconductor revenue reached $16.70B, up 221% YoY. Marvell’s Data Center revenue rose 46% to $2.17B. Custom silicon demand is speeding up quickly, and these two companies sit at the front of it.
Google TPUs Power Broadcom While Optics and Switches Carry Marvell
Broadcom’s quarter ran on XPUs, which made up 73% of AI revenue. Most of its AI business now comes from compute chips built for individual customers. Broadcom began production shipments of the TPU v8i for Google, a unit of Alphabet (NASDAQ:GOOGL), and shipped OpenAI’s first-generation Jalapeno accelerator. CEO Hock Tan made the case directly: “when you co-develop a chip that is optimized for your particular LLM workloads, you will outperform any GPU.”
Marvell’s growth came more from connectivity. Its 1.6T optical DSPs are ramping, and management expects scale-out switching to more than double this year on 51.2T products. CEO Matt Murphy described the opportunity more broadly: “Every hop in the network at some point was going to get some level of customization and it wasn’t going to just be the accelerator.”
| Business Driver | Broadcom | Marvell |
|---|---|---|
| Main Growth Engine | Custom XPUs plus Tomahawk Ethernet | Optics, switching, XPU-attach |
| Signature Deal | Long-term Google TPU supply | Google warrant for up to 7% of shares |
| Operating Margin | 67.9% | 36.6% non-GAAP |
Broadcom Builds the Brain While Marvell Wires Everything Around It
Broadcom expects AI revenue of about $115 billion in fiscal 2027 and $230 billion in fiscal 2028, and it says it has already secured the supply to deliver it. That gives Broadcom unusual visibility for a chipmaker. The risk is concentration: it has six XPU customers, and management expects four of them to be especially large. Broadcom is also helping frontier labs finance compute through a financing platform with private equity partners, which adds some balance-sheet risk.
Marvell is spreading its exposure across more product categories, including CXL memory expansion, NPO optics, and custom NICs. It plans about $1 billion of supplier prepayments this fiscal year to lock in capacity. Management expects its custom business to more than double year over year in fiscal 2028. That is an aggressive target, but it is backed by the Google agreement.
Supply Bottlenecks Will Decide Who Pulls Ahead
I will be watching whether Broadcom’s Singapore substrate facility comes online in fiscal 2027 as planned. Tan said demand already tops the company’s forecast. You should also watch whether Marvell’s non-GAAP operating margin enters its 38% to 40% target range in Q4 as management expects, even as the lower-margin custom ramp weighs on gross margin.
Both stocks have been volatile. Over the past week, Broadcom fell 9.07% and Marvell fell 17.24%, so view can turn quickly even when fundamentals are strong. The custom-silicon winners tend to show the same early signs the biggest tech runs did, which is what we cataloged in a free playbook on spotting the next Nvidia.
Broadcom Offers Durability While Marvell Carries Bigger Swings
Broadcom’s case rests on durability. It has visibility measured in gigawatts, $13.66B of quarterly free cash flow, and VMware revenue as a cushion. Broadcom is down 4.49% year to date, so the stock price has not kept up with the fundamentals. That gap is worth tracking.
Marvell pairs faster growth with bigger swings. Its shares are up 168.54% year to date, so the market has already priced in a lot of optimism. Whether the Google programs ramp early in fiscal 2029 is a key variable to monitor.
Contact [email protected] for any questions or corrections.
Alex Sirois is a financial writer with experience spanning both retail and institutional investing. He has written for InvestorPlace and held roles at BNY Mellon and Bernstein, giving him a perspective that bridges Main Street portfolios and Wall Street analysis.
Alex holds an MBA from George Washington University and has built his career across multiple industries, including e-commerce, education, and translation — a breadth of experience that informs how he breaks down complex financial topics for everyday investors. His writing is conversational, actionable, and grounded in long-term, buy-and-hold investing principles.
At 247 Wall St., Alex focuses on delivering analysis that is both accessible and useful, with a clear emphasis on helping readers make more informed decisions with their money.
