Marvell Technology's (MRVL +6.04%) share price is moving higher in Monday's trading. The semiconductor stock was up 6.5% as of 3:40 p.m. ET despite a modest pullback for tech stocks. At the same point in the day's trading, the S&P 500 and the Nasdaq Composite were both down 0.4%.
Marvell is getting a valuation boost thanks to a recent report suggesting that Alphabet is contracting with the company for two new chip designs. As of this writing, Marvell stock is now up roughly 75% this year.
Image source: Getty Images.
Is Marvell set for a big contract win?
Over the weekend, The Information published a report stating that Marvell was in talks with Alphabet to develop two new artificial intelligence (AI) chips. The core design purpose of the new chips is reportedly to run AI applications more efficiently. The training of AI applications is currently heavily reliant on the huge processing power provided by advanced graphics processing units (GPUs) from Nvidia and other chip designers, but Alphabet and other big-tech companies are looking to more specialized chips that are capable of running AI systems more efficiently.
NASDAQ: MRVL
Key Data Points
What's next for Marvell?
Marvell has seen big valuation gains this year in conjunction with news that Nvidia was investing $2 billion in the chip specialist and expanding its partnership with the company. Recent news that Alphabet could be partnering with Marvell to create two new chips is another bullish indicator on the AI front. While there's no guarantee that these contract wins with Alphabet will materialize, things are looking good for Marvell right now.
