Chipmaker Marvell Technology late Thursday matched estimates for earnings and beat on sales in its fiscal first quarter. It also guided higher than views for the current period. But Marvell stock fell in extended trading.
The Santa Clara, Calif.-based company earned an adjusted 24 cents a share on sales of $1.16 billion in the quarter ended May 4. Analysts polled by FactSet had expected earnings of 24 cents a share on sales of $1.15 billion. On a year-over-year basis, Marvell earnings sank 23% while sales dropped 12%.
Stronger-than-forecast demand for AI infrastructure chips drove Marvell's revenue beat in the first quarter, Chief Executive Matt Murphy said in a news release. Marvell makes custom AI processors for hyperscale cloud service providers Amazon and Alphabet's Google.
"Our data center revenue grew 87% year over year, with the start of a ramp in our custom AI programs complementing our substantial base of electro-optics revenue," Murphy said.
For the current quarter, Marvell forecast adjusted earnings of 29 cents a share on sales of $1.25 billion. Analysts were modeling earnings of 28 cents a share on sales of $1.22 billion for the fiscal second quarter. In the year-earlier period, Marvell earned an adjusted 33 cents a share on sales of $1.34 billion.
MRVL Stock In Buy Range
Marvell makes networking and data storage chips used in cloud computing, automotive, communications and other applications.
In after-hours trading on the stock market today, MRVL stock slid more than 4% to 73.38. During the regular session Thursday, Marvell stock advanced 1.4% to close at 76.85.
Marvell stock has a buy point of 76.29 from a double-bottom base, according to IBD analysis. The 5% buy zone extends to 80.10. However, the 7%-to-8% stop-loss sell zone starts at 70.95.
That base is within a 13-week consolidation pattern with an additional buy point of 85.76, according to IBD MarketSurge charts.
MRVL stock ranks eighth out of 39 stocks in IBD's fabless chipmaker industry group, according to IBD Stock Checkup. Marvell has an IBD Composite Rating of 90 out of 99.
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