Marvell forecasts quarterly revenue above estimates on AI chip demand

FILE PHOTO: Computer motherboard and chip appear in this illustration taken August 25, 2025. REUTERS/Dado Ruvic/Illustration/File Photo

Aug 27 : Marvell Technology forecast quarterly revenue above estimates on Thursday, a sign of strong demand for its custom chips and networking gear used in AI data centers.

Investor expectations were high ahead of the results, with Marvell's stock nearly tripling in value so far this year on AI-driven optimism. Shares of the company fell over 1 per cent in extended trading.

Big Tech's push to develop in-house chips that serve as a cheaper alternative to Nvidia's costly and supply-constrained processors has driven demand for Marvell's custom silicon business, making it a big winner of the data-center buildout.

Demand for such chips has also risen as AI use shifts from training models to running them, where custom chips can deliver better performance and efficiency than off the shelf processors.

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The company expects third-quarter revenue of $3.15 billion, plus or minus 5 per cent, compared with analysts' average estimate of $3.03 billion, according to data compiled by LSEG.

Adjusted profit for the current quarter is expected to be $1.10 per share, plus or minus 5 cents, above estimates of $1.07.

Last week, Marvell struck a custom chip deal with Google that could bring in $120 billion in revenue through fiscal 2033 and make the make the Alphabet-owned search giant one of its biggest investors with an up to $12.2 billion stake.

The Google tie-up is a major strategic victory, diversifying Marvell's custom chip customer base and setting it up to better challenge larger rival Broadcom, which has custom chip deals with OpenAI and has been a key Google partner.

Second-quarter sales rose 37 per cent to $2.74 billion, beating estimates of $2.71 billion. Adjusted profit came in at 94 cents per share, compared with estimates of 92 cents.

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