AI Computing Demand Boosts Marvell Technology’s Earnings
Marvell Technology Inc. saw its shares soar in late trading after the chipmaker reported better-than-expected results and a rosy earnings forecast, driven by surging demand for artificial intelligence computing.
Strong Q3 Performance
The company’s third-quarter profit, excluding certain items, came in at 43 cents per share, surpassing the 41-cent average estimate of analysts. This strong performance was largely driven by Marvell’s custom AI silicon programs, which are now in volume production.
Upbeat Earnings Forecast
Marvell expects earnings to reach as high as 64 cents per share in the current period, significantly exceeding the 52-cent projection. This optimistic outlook is a testament to the company’s successful positioning in the booming AI industry.
AI Accelerators and Cloud Computing
Under the leadership of CEO Matt Murphy, Marvell has focused on developing AI accelerators and other components used by cloud-computing providers to create advanced services. While the company hasn’t experienced the same level of sales growth as Nvidia Corp., its products are in high demand.
CEO Commitment
Murphy, who has been at the helm since 2016, has been approached by Intel Corp. as a potential candidate to lead the company. However, he reaffirmed his commitment to Marvell, stating that he couldn’t think of a better place to work. “I’m 100% focused on Marvell,” he emphasized during a conference call.
Q4 Sales Expectations
Marvell expects sales to reach roughly $1.8 billion in the fourth quarter, outpacing the average estimate of $1.64 billion. This growth is expected to continue, with sales increasing 7% to $1.52 billion in the third quarter, surpassing the $1.45 billion prediction.
Shares Surge
The company’s shares gained almost 11% to $106.35 in extended trading after the results were released, adding to their 59% growth this year.
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