Marvell stock soars after upbeat earnings outlook, projection that AI revenue will double this year
By Emily Bary
Marvell expects an acceleration in revenue growth during the second half of the fiscal year
Shares of Marvell Technology Inc. were soaring 15% in after-hours activity Thursday after the chip company topped expectations with its quarterly outlook and forecast that revenue related to artificial intelligence would at least double this year.
Marvell (MRVL) posted a fiscal first-quarter net loss of $168.9 million, or 20 cents a share, compared with a loss of $165.7 million, or 20 cents a share, in the year-earlier period. On an adjusted basis, Marvell earned 31 cents a share, compared with 52 cents a share a year before, while analysts were modeling 29 cents a share.
Revenue declined to $1.32 billion from $1.45 billion, while analysts were expecting $1.30 billion.
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"AI has emerged as a key growth driver for Marvell, which we are enabling with our leading network connectivity products and emerging cloud optimized silicon platform," Chief Executive Matt Murphy said in a release. "While we are still in the early stages of our AI ramp, we are forecasting our AI revenue in fiscal 2024 to at least double from the prior year and continue to grow rapidly in the coming years."
For the fiscal second quarter, executives at Marvell expect $1.33 billion of revenue at the midpoint, while the FactSet consensus called for $1.31 billion. Marvell's management also anticipates adjusted earnings per share of 32 cents at the midpoint, whereas analysts had been projecting 30 cents.
Marvell also expects a GAAP gross margin of 44.3% to 46.8% and a non-GAAP gross margin of 60.0% to 61.0% for the ongoing quarter.
Murphy said Marvell expects an acceleration in revenue growth during the second half of the fiscal year, " accompanied by gross and operating margin expansion."
Shares of Marvell roared nearly 8% higher in Thursday's regular session, fueled by Nvidia Corp.'s (NVDA)upbeat commentary about the state of spending on chips that help customers with their artificial-intelligence initiatives.
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-Emily Bary
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May 26, 2023 08:10 ET (12:10 GMT)
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