Marvell raises forecasts, shares fall
Marvell Technology boosted its revenue outlook for fiscal 2027 and 2028, but investors pushed the stock lower after the earnings call.
Marvell Technology raised its annual revenue forecast on Thursday, announcing a 45% growth to about $12 billion for fiscal 2027 and $18 billion for fiscal 2028. The company’s shares fell 1.49% in after-hours trading as investors weighed the implications of the new Google partnership.
Earnings Results
Marvell reported revenue of $2.7 billion for the July quarter, matching analyst expectations. Adjusted earnings per share were 94 cents, a touch above the consensus of 93 cents. Demand for the company’s data-center products was a key driver, with revenue in that segment up 46% year-over-year. The firm also highlighted strong demand for its connectivity offerings.
For the October quarter, management forecast revenue of $3.15 billion, a midpoint estimate that exceeds the FactSet consensus of $3 billion. The adjusted earnings-per-share forecast of $1.10 also tops the consensus of $1.08. The company expects its custom-chip business to see a significant acceleration beginning in the second half of fiscal 2027.
| Fiscal Year | Old Guidance | New Guidance |
|---|---|---|
| 2027 | $11.5 billion | $12 billion |
| 2028 | $16.5 billion | $18 billion |
For a detailed view of Marvell’s performance, see the latest stats. Upcoming earnings events are listed in the fixtures.
Google Deal Impact
Marvell’s expanded partnership with Google includes a warrant that allows the search giant to purchase shares and a joint effort on Google’s custom-chip program. Management explained that revenue from programs covered by the agreement through fiscal 2028 is already reflected in the overall custom revenue target. The “big impact” is expected to materialize in fiscal 2029 and beyond.
The company’s CEO, Matt Murphy, described the demand for artificial-intelligence-related offerings as “exceptionally robust.” He also noted that the custom-chip business would accelerate significantly in the latter half of fiscal 2027.
Analyst Reactions
Jefferies analyst Blayne Curtis said Marvell’s story had materially improved, citing a report that Microsoft plans to launch its new Maia 300 chip later this year. Curtis also highlighted the expansion of Marvell’s agreement with Alphabet, which will co-develop products in Google’s custom-chip ecosystem, including inference accelerators and storage controllers.
Investors had been excited about the expanded partnership, but the earnings call left many questioning whether the new agreement had already been fully priced in. Shares had nearly tripled year-to-date before the earnings announcement.
The stock closed 1.49% lower in extended trading.
