Marvell Technology's AI Bet Pays Off, Sort Of
Hey everyone, check this out! Marvell Technology, you know, the tech company, recently gave their forecast for the next few months, and it looks pretty solid. They think they'll make more money than folks on Wall Street expected for this upcoming quarter. Why? Well, it all comes down to these custom chips they make.
Turns out, there's a huge need for these special chips that power all that artificial intelligence stuff in massive data centers. Demand for AI chips is still going strong, and other things they make, like network chips and those cool electro-optics, are also seeing lots of orders. This is great for big companies that need to build up their tech to handle more AI work.
Marvell actually said after their earnings call that they believe AI is going to keep being a big deal for them. They mentioned things like big companies spending a lot, new government data center projects popping up, and even new players in different markets expanding things. All of this opens up lots of chances for them to grow.
Just so you know, their data center part of the business, which is a huge chunk of their total money coming in (like, 76%!), brought in over a billion bucks in the first three months. And it's not just data centers; their carrier and business networking parts are slowly getting better after a time when companies had a bit too much inventory.
Someone named Angelo Zino, who's an analyst, thinks that making these custom chips will be the main thing driving their growth over the next few years, maybe the next 3-5 years. He even thinks it will help their profits, even if they don't make as much per chip. He also pointed out that Marvell has a webinar coming up on June 17th about these custom chips. Maybe that could be a game-changer, potentially showing they can reach more customers or land some new deals.
But hey, it's not all sunshine and rainbows. The consumer part of their business wasn't doing so hot, with money dropping quite a bit in the last few months. This is because gaming demand usually goes down around that time. Their industrial part also had a tough time, with money going down too.
Because of this, Marvell's stock price went down a little right after they announced all this. They figure they'll make about $2 billion this next quarter, give or take a bit. This is a little more than analysts thought, which was closer to $1.98 billion.
Remember how in May they said they were putting off their investor day meeting? They said it was because the economy was a bit shaky. For the quarter that just ended, they actually brought in $1.9 billion, which was also a little more than what the experts expected.
So, what do you think about all this? It's a bit of a mixed bag, right? Strong in AI, but some other areas are still struggling a bit. It makes you wonder what the future holds, doesn't it?
