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Marvell Stock Soars 23% on AI Chip Demand

Ken Metral

Ken Metral

— 2 min read
Marvell Stock Soars 23% on AI Chip Demand
Credit: Marvell Technology, Inc.

Chipmaker Marvell Technology (MRVL) jumped 23.2% following its fiscal Q3 2025 earnings report, driven by robust AI chip demand and better-than-expected guidance for the next quarter. CEO Matt Murphy highlighted the company’s "substantial momentum," projecting continued growth into fiscal 2026.

Key Financial Highlights

  • Revenue: $1.52 billion, up 7% year-over-year (YOY).
  • Adjusted Earnings Per Share (EPS): $0.43, surpassing Wall Street’s estimate of $0.40.
  • AI Revenue Dominance: Data center revenue grew 98% YOY, driven by custom AI chips and interconnect products, now accounting for 72% of Marvell’s total revenue, up from 39% last year.

While overall revenue growth was modest, the booming AI segment significantly outperformed other markets, which struggled amid industry-wide challenges.

AI-Powered Growth

The data center segment’s phenomenal 98% YOY growth was fueled by Marvell’s custom AI silicon and interconnect products. This surge has dramatically shifted Marvell's business profile, making AI-driven solutions the cornerstone of its revenue.

CEO Matt Murphy noted, "The exceptional performance in the third quarter, and our strong forecast for the fourth quarter, are primarily driven by our custom AI silicon programs, now in volume production, and robust demand from cloud customers."

Q4 Guidance Outpaces Expectations

For fiscal Q4, Marvell projects:

  • Revenue: $1.8 billion, up 26% YOY.
  • Adjusted EPS: $0.54 to $0.64, surpassing Wall Street’s $0.52 estimate.

Murphy emphasized that the company anticipates accelerating growth into fiscal 2026, propelled by demand for AI solutions.

Broader Challenges

While AI-powered data centers shine, other segments lagged:

  • Enterprise networking revenue fell 44%.
  • Carrier infrastructure dropped 73%.
  • Consumer revenue declined 43%.
  • Automotive/industrial fell 22%.

These declines reflect broader semiconductor industry trends rather than company-specific issues.

Investor Takeaway

Marvell’s strong Q3 performance and upbeat Q4 guidance position it as a rising player in the AI semiconductor space, challenging industry leader Nvidia. Its focus on custom AI chips and data center solutions aligns with surging demand in AI infrastructure.

With a promising outlook for fiscal 2026, Marvell appears set to maintain its upward trajectory, capitalizing on the growing AI market while navigating challenges in its other segments. Investors are optimistic, as evidenced by the stock’s 23% surge, solidifying Marvell as a key contender in the booming semiconductor arena.

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