This year Marvell’s stock rose 95%, giving it a $100 billion market capitalization, according to the Wall Street Journal.
“The latest gains have even put Marvell’s market cap ahead of much-beleaguered Intel, which still generates 10 times as much annual revenue.”
Marvell’s recent trajectory suggests that the revenue gap will continue to narrow. The explosive growth of its data center business has finally reached a point where it can more fully offset weakness in the company’s more legacy segments, which sell chips used in goods such as telecommunications gear, cable TV boxes and autos. Data center sales nearly doubled year over year to $1.1 billion in the just-ended quarter, and Marvell’s projection for the current period indicates the company will end its fiscal year in January with the data center unit encompassing about 72% of its total revenue, up from 40% in the previous year.
The next year is looking bright as well. Marvell’s latest deal with Amazon is a five-year “multigenerational” agreement that has Marvell helping Amazon design its own artificial intelligence chips. Amazon, which runs the world’s largest cloud computing service, has been expanding its internal chip efforts significantly, in part to reduce its reliance on Nvidia for crucial AI components. Amazon announced the next generation of its largest AI chip, called Trainium, at its annual developers conference this week. Analysts believe Trainium will play a role in Marvell’s AI custom revenue more than doubling in the next fiscal year ending January of 2026.
That is expected to help propel Marvell’s annual revenue to more than $8 billion in fiscal 2026, up 40% from what is expected for this year, according to consensus estimates from Visible Alpha. In addition, 20% growth is expected for the following year, when Marvell expects to be in production of custom AI chips for another unnamed big tech customer that analysts believe to be Microsoft. Analyst Mark Lipacis of Evercore ISI projects that the industry for custom AI chips will reach $30 billion to $50 billion in sales by 2030. In a note to clients last week, he said Marvell “has the potential to capture one-third of that market.”
Marvell’s CEO “has been among the few names floated as potential replacements for the recently ousted Pat Gelsinger at Intel’s corner office,” the article points out — which meant he had to reassure investors on an earnings call that he was staying at Marvell.
“The company is outstanding. The technology is best-in-class. I can’t think of a better place to work than Marvell.”
