Shares of Marvell Technology fell 8% in premarket trading despite a second-quarter revenue beat, after the chipmaker’s updated fiscal 2028 outlook failed to meet elevated investor expectations.
Marvell now expects fiscal 2028 revenue of about $18 billion, representing roughly 50% annual growth and exceeding its previous forecast of $16.5 billion. Second-quarter revenue rose 37% to $2.7 billion, beating the company’s May guidance by $39 million.
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AI Demand Drives Revenue Growth
Marvell supplies networking, connectivity and custom chips used in AI data centres, where revenue increased 46% year on year in the latest quarter. CEO Matt Murphy said AI-related bookings remained strong and forecast further revenue growth through the rest of fiscal 2027.
Despite the higher outlook, Marvell provided limited detail on how it would reach the $18 billion target. That added to investor concerns after the company’s recent Google partnership, which could allow Google to purchase up to $12.2 billion in Marvell stock through fiscal 2033.
Under the agreement, Google can buy up to 58.97 million Marvell shares at $206.58 each, subject to performance targets. The partnership covers products supporting Google’s TPU systems, including AI inference chips, storage controllers and network interface controllers.
Investors Had Higher Expectations
Goldman Sachs said investor expectations were already high heading into the results because of strong spending by major customers and the Google agreement. Analysts described the results as an “incremental positive” but maintained a neutral rating, citing Marvell’s higher valuation relative to peers and uncertainty over its ability to add more custom-chip customers.
Marvell shares have gained 184% this year despite the latest decline, reflecting strong investor demand for companies supplying AI infrastructure.
