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AI Chips & Compute

Marvell raises AI revenue outlook, lifting chip stocks and market optimism

Marvell Technology raised its fiscal 2028 revenue outlook to $20 billion and projected fiscal 2031 revenue of $70 billion to $90 billion at its investor day, sending shares up more than 6% and boosting AI chip peers Nvidia and Broadcom, CNBC reported.

AI News Feed · 2026-10-07 05:13

At its investor day, Marvell increased its fiscal 2028 revenue outlook from the $18 billion guidance it gave alongside its fiscal 2027 second-quarter results in late August. The company said the additional $2 billion of revenue is being driven by strong demand for its data center connectivity solutions, including interconnect scale-up optics and switching, which help data travel within and across server racks inside data centers.

Marvell also said it sees strong growth in its custom chip business, which counts Amazon and Alphabet among its major customers. The company expects its custom business to triple in fiscal year 2029 from fiscal year 2028, reaching more than $12 billion.

Longer term, Marvell said it expects total company revenue in the range of $70 billion to $90 billion in fiscal year 2031, well above the consensus estimate of $47 billion, according to FactSet. Supporting that outlook, Marvell said it expects data center capital expenditures to reach $3 trillion by 2030, growing at about a 35% compound annual rate from 2025 to 2030. The company assumed the current rate of capital expenditure growth would moderate over the forecast period and move closer to historical levels in the out-years.

Marvell's guidance lifted other AI chip stocks. Nvidia rose about 0.5% and was tracking for back-to-back record closes, while Broadcom jumped more than 4%, which would be its best day since late August, CNBC reported. CNBC's Investing Club noted that Marvell's outlook speaks positively to trends Nvidia and Broadcom are also experiencing in compute and networking connectivity, though the club does not own Marvell.

Broader markets were higher on Tuesday. The S&P 500 was on pace for a fourth straight session of gains and a record close, while the Nasdaq was also on pace for a record close. Treasury yields slid slightly, and WTI crude remained under $90 per barrel. Every sector in the S&P 500 was positive except healthcare, which trailed due to weakness in Moderna and companies exposed to biotechs.

Utilities and industrials were toward the top of the leaderboard after Google announced a major long-term power agreement with Constellation Energy. The news sent shares of other companies that power and electrify AI data centers higher, including GE Vernova and Eaton.

After the closing bell on Tuesday, Corona and Modelo brewer Constellation Brands was scheduled to report earnings. Its shares, under CEO Nick Fink since April, were down more than 16% year to date. No major earnings were scheduled before the opening bell on Wednesday.

On the data side, investors were waiting for the New York Federal Reserve's one-year inflation expectations and the minutes from the Federal Open Market Committee's September meeting.