Marvell Sees Boost from AI Chips
Okay, so Marvell Tech, you know, the company ticker is MRVL.O, they're feeling pretty good about the next few months! They actually think they'll make even more money than the smart folks on Wall Street thought they would. Why? Well, it's all about those special chips they make for powering all the cool artificial intelligence stuff happening in huge data centers.
Demand for these custom AI chips is seriously booming. Also, the chips they make for connecting things and for fiber optics are getting lots of orders too. This is helping those giant companies that run big data centers build up their systems to handle all the AI work. Marvell said after their earnings call that they believe this AI trend is gonna keep being super strong. They mentioned that big companies are spending a lot, there are new projects building data centers for governments, and even new players in the market are growing, which is creating more chances for them.
Get this, a whopping 76% of Marvell's total money coming in during the first quarter was from their data center business. That's a ton of cash, like $1.44 billion! Their businesses that deal with phone companies and businesses are also starting to get better after people stopped buying so much for a bit.
Someone named Angelo Zino, who's an analyst at CFRA Research, thinks these custom chips will be the main thing helping Marvell grow over the next 3 to 5 years. He said they'll help with profits even if they don't make as much per chip. Zino also said that a webinar they're having on June 17 about custom chips could be important because maybe they'll show how the market is getting bigger or announce new customers for 2026.
However, things weren't so great for their consumer business. The money they made from selling to regular people went down by 29% from the previous quarter, which they said was because people aren't buying as many gaming products right now. Their industrial business was also a bit rough, with money coming in dropping by 12% compared to the quarter before. So, their stock actually went down a little bit, around 2%, after hours.
Looking ahead to the next quarter, Marvell is expecting to bring in about $2 billion, give or take 5%. That's just a little bit higher than what the analysts were guessing, which was around $1.98 billion according to LSEG. Also, back in May, Marvell actually delayed a meeting they had planned for investors. They said it was because the economy was kind of uncertain. For the quarter that ended on May 3rd, they reported making $1.9 billion, which was also a bit more than the analysts expected, who thought they'd make around $1.88 billion.
