Justin Sullivan
Update 12:32pm: Updates shares, adds Google comment.
A report Thursday that Google (NASDAQ:GOOGL) has looked into the possibility of cutting Broadcom (NASDAQ:AVGO) as a supplier is “patently false,” according to CNBC’s Jim Cramer. Broadcom pared its losses to 2% in midday trading on Thursday after tumbling 7% in premarket trading.
Google (GOOGL) said it sees “no change” in its relationship with Broadcom (AVGO).
“We are productively engaged with Broadcom and multiple other suppliers for the long term,” a Google spokesperson told Bloomberg in an email. “Our work to meet our internal and external Cloud needs benefit from our collaboration with Broadcom; they have been an excellent partner and we see no change in our engagement.”
Mountain View, California-based Google (GOOGL) could make the move to drop Broadcom (AVGO) as soon as 2027, The Information reported on Thursday, citing a person with direct knowledge of the effort. If Google chooses to drop Broadcom, it may rely exclusively on the chips, known as tensor processing units, in house.
“I believe that the story that came out in The Information is patently false,” Cramer said on the business network. “The relationship is deep, multiple years, and I think they are actually good strategic partners.”
“All i can tell you is that the story as I understand it is patently false,” Cramer added.
Google (GOOGL) and Broadcom (AVGO) didn’t immediately respond to Seeking Alpha request for comment.
The Information added that Google (NASDAQ:GOOG) could also replace Broadcom (AVGO) with a custom chip from Marvell Technology (MRVL) that connects servers to ethernet switches inside data centers.
In April, Google (GOOG) (GOOGL) touted the capabilities of its own TPUs. The Sundar Pichai-led company said the fourth-generation TPUs that train its artificial intelligence models were faster and more power-efficient than Nvidia’s (NVDA) A100 chips.
