Marvell Technology falls 6% as Google warrant dilution overshadows deal rally

Published Aug 21, 04:06 PM UTC

Marvell Technology stock fell 6% on Friday as investor focus shifted from the revenue potential of a new deal with Alphabet's Google to the dilutive impact of a warrant granted to Google. The warrant allows Google to buy up to 59 million Marvell shares at $206.58, below the current trading price, meaning future appreciation is partially promised to the customer. This dilution concern outweighed the initial deal rally. In contrast, Broadcom, a direct competitor and incumbent supplier for Google's TPU, saw its stock rise 1%, attributed to its lower forward P/E ratio of 20x versus Marvell's 58x, leaving less room for repricing. The broader iShares Semiconductor ETF dipped only 0.8%, confirming the selloff is a single-name event. Marvell's fundamentals remain strong with Q1 fiscal 2027 revenue up 27.6% year-over-year, but the market is now pricing in the cost of the partnership.