Marvell Shares Sink 8% on Underwhelming Outlook Despite Revenue Beat

The company now expects revenue to grow about 50% year over year to around $18 billion, up from its prior projection of $16.5 billion. Revenue in the fiscal second quarter rose 37% from a year earlier to $2.7 billion, exceeding the company's guidance by $39 million.

The stock, which had climbed 184% this year on demand for its AI data-center chips, fell sharply after Marvell offered limited detail on its fiscal 2028 outlook. Investors had been hoping that a recently announced partnership with Google, valued at up to $12.2 billion in shares, would provide an additional earnings boost.

Marvell, which makes networking, connectivity and custom chips for AI data centers, said the Google agreement covers products that work with Google's TPU systems, including AI inference chips, storage controllers and network interface controllers. Under the terms announced last week, Google can buy up to 58.97 million Marvell shares at $206.58 each, subject to meeting purchase targets through fiscal 2033.

Chairman and CEO Matt Murphy said results were driven by continued strong demand across the company's data center portfolio, where revenue growth accelerated to 46% year over year. "AI-related bookings remain exceptionally robust, and we expect our revenue growth to accelerate further through the remainder of fiscal 2027," Murphy said.

Goldman Sachs analysts said investor expectations were elevated going into the quarter because of robust spending at key customers and the previously disclosed Google relationship. The results were an "incremental positive" for the stock, they said in a Thursday note, but the bank remains neutral on Marvell due to its higher valuation relative to peers and uncertainty about its ability to add custom-chip customers.