Marvell raises annual forecast but shares fall on Google AI deal timing concerns

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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