Marvell Technology shares fell 8% in premarket trading on August 28, 2026, despite beating fiscal second-quarter expectations with a 37% revenue increase to $2.74 billion. Although Marvell raised its fiscal 2027 and 2028 revenue forecasts to $12 billion and $18 billion respectively, investors grew concerned over the timing of its massive $120 billion custom-chip deal with Google. CEO Matt Murphy noted that significant Google revenue will not materialize until fiscal 2029, dampening short-term expectations.
Marvell stock decline after earnings
- ▪Marvell Technology reported fiscal second-quarter revenue of $2.74 billion, representing a 37% year-on-year increase and beating analyst estimates of $2.71 billion
- ▪Marvell Technology reported an adjusted profit of 94 cents per share for the fiscal second quarter, beating analyst estimates of 92 cents per share
- ▪Marvell Technology shares fell over 6% in after-hours trading on August 27, 2026, as investor concerns over the timing of Google deal revenue overshadowed raised annual forecasts
- ▪Marvell Technology shares fell 8% in premarket trading on August 28, 2026, despite the company reporting better-than-expected fiscal second-quarter results
Google deal revenue timing concerns
- ▪Marvell Technology CEO Matt Murphy stated that Google-related revenue is already partially reflected in the company's fiscal 2028 targets and will contribute more significantly in fiscal 2029
- ▪The Google partnership allows Google to purchase up to 58.97 million Marvell Technology shares at $206.58 each, potentially giving Google an up to $12.2 billion stake
- ▪Marvell Technology recently secured a custom-chip deal with Alphabet's Google that could generate up to $120 billion in revenue through fiscal 2033
- ▪Morgan Stanley analysts stated that investor expectations were elevated due to the Google deal, but its revenue contribution was already largely embedded in Marvell Technology's prior guidance
Fiscal 2027-2028 revenue forecasts
- ▪Marvell Technology raised its fiscal 2027 revenue forecast to approximately $12 billion, up from its prior forecast of about $11.5 billion, representing roughly 45% growth
- ▪Marvell Technology CEO Matt Murphy declined to provide a new fiscal 2029 revenue target, deferring specific details to the company's investor day scheduled for October 6, 2026
Custom chip demand growth
- ▪The custom-chip agreement between Marvell Technology and Google covers products that work with Google's TPU systems, including AI inference chips, storage controllers, and network interface controllers
- ▪Marvell Technology's data center portfolio revenue growth accelerated to 46% year over year, driven by robust AI-related bookings
- ▪Big Tech companies are increasingly turning to custom silicon to develop in-house chips that are more cost-efficient and performant than Nvidia's costly, supply-constrained processors
High valuation versus peers
- ▪Goldman Sachs analysts maintained a neutral rating on Marvell Technology, citing its higher valuation than peers and lower certainty regarding its ability to secure additional custom-chip customers
- ▪Marvell Technology trades at a premium compared to rival Broadcom, with a 12-month forward price-to-earnings ratio of 58.41 versus Broadcom's 32.15
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