💡 Marvell boosted by AI chips, sales beat estimates, outlook promises more!
Marvell Technology $MRVLLconfirmed that it is one of the top manufacturers of advanced chips. These chips power the AI infrastructure in data centers and are pulling up the bottom line. The company beat expectations in the quarter and the outlook for the next period suggests continued growth.

📊 Q1 results and Q2 outlook:
Q1 revenue: $1.9 billion (vs. expectations of $1.88 billion)

Q2 revenue (outlook): USD 2.0 billion ± 5% (vs. expectations of USD 1.98 billion)

Data center segment, which consists of 76 % of total sales, reached USD 1.44 billion, continuing its dominance. Support comes mainly from the largest cloud service providers (AWS, MS Azure...), government AI projects and emerging companies building their own data centres.

🔩 Key trend: custom silicon
Marvell is relying on the so called. custom silicon - chips designed to meet customers' exact needs. Although they have lower gross margins, their volume and strategic importance should bring the company strong growth and improved operating profitability over 3-5 years. This segment may be where Marvell will dominate.

📉 Weaker links in the chain:
Industrial segment: -12% sequentially, demand issues persist.

Shares fell by more than 5 %, likely in response to caution about the consumer sector and the macroeconomic environment. Since the peak, the company's shares have traded lower by 52 %.

Marvell is growing along with AI, with custom silicon and demand from data centers the clear drivers of growth.

The outlook for Q2 is above estimates, which is always a good sign, although the stock's decline suggests the market was expecting an even bigger surprise.

The upcoming June webinar on custom chip manufacturing may be a catalyst for further growth.

What's your take on this company? Do you find the current valuation interesting?