- Shares of Marvell Technologies rose 25% after beating the top and bottom of earnings on Friday morning.
- The chip maker reported $1.32 billion in revenue for the first quarter and 31 cents to adjusted earnings per share.
- Marvell CEO Matthew Murphy said AI presented an “enormous” opportunity for the company.
Matt Murphy, CEO, Marvell Technology
Scott Mill | CNBC
Marvell Technology shares continued their overnight rally Friday morning, rising nearly 25% on quarterly earnings results that outperformed net earnings.
On Thursday, the chipmaker reported 31 cents in adjusted earnings per share for the first quarter, more than Refinitiv’s consensus estimate of 29 cents per share. Revenue was $1.32 billion for the period, more than the $1.3 billion analyst consensus.
Marvell shares are now trading at levels not seen since April 2022.
On a conference call with analysts, Marvell CEO Matthew Murphy said the company had begun to reassess how it viewed the “enormous” commercial potential of AI.
“In the past, we considered AI as one of many applications within the cloud, but its importance and therefore opportunity has increased exponentially,” Murphy said.
Citi analysts said in a note to investors that the company has a great opportunity to grow its AI-driven revenue stream. Citi raised its price target from $58 to $61 and maintained the Buy rating.
A memo from Atif Malik of Citi said: “In fiscal year 2023, MRVL estimated AI revenues to be around $200m, which is a solid uptick from FY22. The company expects AI sales to reach $400m+ in FY24. before doubling in fiscal year 25″.
Several semiconductor companies saw an uptick in Wednesday’s earnings report from Nvidia. Nvidia’s market capitalization is now close to $1 trillion.
CNBC’s Michael Blum and Chris Hayes contributed to this report.