Nvidia announced a $2 billion investment in Silicon Valley chipmaker Marvell, aimed at boosting the networking technology connecting AI chips in large data centers. The semiconductor giants will collaborate on silicon photonics to upgrade data center systems with optical technology, accelerating data flows between components.

Marvell provides specialized AI chips to US hyperscalers including Amazon, creating an alternative to Nvidia's GPUs. This partnership enables "seamless integration" between custom AI chips and Nvidia's ecosystem, as the company expands beyond its core GPU technology. Marvell shares jumped 8% Tuesday, valuing the company at approximately $83 billion after a 52-week gain of over 50%.

The alliance represents Nvidia's strategy to leverage its AI processor leadership to become a comprehensive platform for AI data centers. Building on its 2019 $6.9 billion acquisition of Mellanox and recent $20 billion deal with Groq, Nvidia continues consolidating its position in the AI infrastructure market where connectivity between chips has become critical for advancing systems like Google's Gemini and OpenAI's ChatGPT.