Marvell +7.59% Technology shares surged following the company’s solid earnings and guidance that was slightly above Wall Street expectations.
The semiconductor company reported earnings per share adjusted to 31 cents in the quarter ending April, compared to the 29 cents consensus estimate among Wall Street analysts tracked on FactSet. The revenue came in at $1.3 billion, above the analysts’ expectation of $1.3 billion.
The management’s financial forecast was also solid. The Marvell (ticker:MRVL) predicted a range of possible revenue for the current quarterly with a middle point of $1.33 Billion, compared to the consensus view of revenue of $1.31 Billion.
Matt Murphy, Marvell’s CEO, said in a press release that “AI is a key driver of growth for Marvell.” This is enabled by our leading network connectivity solutions and cloud optimized silicon platforms. While we are in the early stages in our AI ramp, our AI revenue is forecast to double in fiscal 2024 from the previous year and continue to increase rapidly in the following years.
Marvell offers a range of hardware and chips for the 5G infrastructure market, data centers, networking and storage.
Marvell’s stock rose as high as 20% after-hours on Thursday.
The company’s management said on the conference call that the cloud computing industry is undergoing a transition away from traditional central processor units (CPUs), servers, to more complex AI Cluster systems with graphics processing unit (GPUs). Marvell should benefit from the new AI-oriented system’s high bandwidth data connections, as well as low latency links.