Marvell Technology shares declined nearly 6% on Friday despite the chipmaker reporting better-than-expected second-quarter revenue, as investors viewed its updated fiscal 2028 outlook as below elevated expectations.
The company said it now expects fiscal 2028 revenue to reach approximately $18 billion, representing around 50% year-over-year growth. That forecast exceeds its previous projection of $16.5 billion, but investors had been anticipating a stronger outlook following recent AI-related developments.
Marvell reported fiscal second-quarter revenue of $2.7 billion, up 37% year over year and $39 million above the company’s guidance issued in May.
AI Infrastructure Demand Drives Growth
Marvell develops networking, connectivity, and custom semiconductor solutions used in artificial intelligence data centers. The company said strong demand across its data center portfolio helped accelerate revenue growth, which increased 46% year over year in the segment.
“AI-related bookings remain exceptionally robust, and we expect our revenue growth to accelerate further through the remainder of fiscal 2027,” said Marvell Chairman and CEO Matt Murphy.
The company’s stock has gained approximately 184% this year, driven by investor enthusiasm around AI infrastructure spending and demand for advanced semiconductor technology.
Google AI Chip Partnership Raises Expectations
Investor expectations increased following Marvell’s recently announced partnership with Google, which could allow the technology giant to purchase up to 58.97 million Marvell shares at $206.58 each, depending on purchase targets through fiscal 2033.
The agreement covers products designed to support Google’s Tensor Processing Unit (TPU) systems, including AI inference chips, storage controllers, and network interface controllers.
However, Marvell provided limited details about its fiscal 2028 outlook, which reduced investor confidence after expectations that the Google partnership could significantly accelerate future earnings growth.
Analysts Remain Cautious on Valuation
Goldman Sachs analysts noted that investor expectations were already elevated heading into the earnings report due to strong AI infrastructure spending and the previously announced Google relationship.
The analysts described the results as an “incremental positive” for Marvell but maintained a neutral rating, citing the company’s higher valuation compared with peers and uncertainty around its ability to secure additional custom-chip customers.
As demand for AI computing infrastructure continues to expand, Marvell remains positioned as a key semiconductor supplier, though investors are closely watching whether future growth can justify current expectations.
