Marvell Soars 18% As AI Sales Are Expected to Double in 2023

Marvell Technology (MRVL:US) shares traded sharply higher on Friday after the chipmaker delivered better-than-expected Q1 results and issued an upbeat forecast.

Marvell reported a profit per share of $0.31 on revenue of $1.32 billion. While revenue fell 9% compared to a year-ago period, it still topped analyst expectations for the January quarter sales of $1.30 billion. On the bottom line, the Street was looking for a profit of $0.29 per share.

“We are expecting revenue growth to accelerate in the second half of this fiscal year, accompanied by gross and operating margin expansion," said Matt Murphy, Marvell's President and CEO.

While Q1 results were marginally better than Street’s expectations, the stock actually popped on the forecast that Marvell’s artificial intelligence (AI) revenue will “at least double from the prior year and continue to grow rapidly in the coming years."

"AI has emerged as a key growth driver for Marvell, which we are enabling with our leading network connectivity products and emerging cloud optimized silicon platform,” Murphy added.

The company also expects its gross margin to expand for the ongoing quarter.

Marvell’s upbeat guidance comes on the heels of Nvidia’s (NVDA:US) blowout earnings report. Marvell shares already gained 7.6% yesterday as investors were expecting a positive impact following Nvidia’s commentary a day earlier.

Congressman Ro Khanna and Senator Tom Carper were both witnessed trading Marvell shares this year. Both lawmakers reported sale of Marvell shares in the month of April. 

The stock now trades about 50% higher relative to prices seen in mid-April.