Marvell Technology(MRVL) - 2025 Q3 - Quarterly Report

Revenue and Sales Performance - Net revenue for the three months ended November 2, 2024, was $1,516.1 million, compared to$1,418.6 million in the same period last year[9] - Net revenue for the three months ended November 2, 2024 was $1,516.1 million, with direct customers contributing$895.4 million (59%) and distributors contributing $620.7 million (41$3,949.9 million, with direct customers contributing $2,229.2 million (56$1,720.7 million (44%)[29] - Net revenue in Q3 FY2025 was $1.5 billion, a 7$97.5 million (7%) compared to the same period in 2023, driven by a 98% increase in data center sales due to strong AI demand[133] - Net revenue for the nine months ended November 2, 2024 decreased by $131.3 million (3$1,101.1 million, representing 73% of total revenue, up from $555.8 million (39$150.9 million (10% of total) in the three months ended November 2, 2024, from $271.1 million (19$82.9 million (5% of total) in the three months ended November 2, 2024, down from $106.5 million (8$256.0 million) of total revenue in the three months ended November 2, 2024, up from 15% ($217.1 million) in the same period last year[27] - China accounted for 43$658.4 million, compared to 43% ($605.3 million) in the same period last year[27] - Sales to customers in Asia represented 74$2,798.4 million, representing 71% of total revenue, compared to $1,451.4 million (36$1,774.8 million) for the nine months ended November 2, 2024, up from 41% ($1,690.3 million) in 2023[26] - Enterprise networking revenue for the nine months ended November 2, 2024, was$455.0 million (12% of total), down from $963.4 million (24$232.4 million, compared to $881.9 million (22$227.4 million, down from $478.5 million (12$236.7 million, compared to $306.0 million (6$675.4 million) for the nine months ended November 2, 2024, up from 15% ($607.2 million) in 2023[26] - Taiwan accounted for 7$279.6 million) for the nine months ended November 2, 2024, up from 3% ($135.8 million) in 2023[26] Profit and Loss - Net loss for the three months ended November 2, 2024, was$676.3 million, compared to $164.3 million in the same period last year[9] - Gross profit for the three months ended November 2, 2024, was$349.4 million, down from $551.2 million in the same period last year[9] - Operating loss for the three months ended November 2, 2024, was$702.8 million, compared to $146.3 million in the same period last year[9] - Comprehensive loss for the three months ended November 2, 2024, was$676.2 million, compared to $164.7 million in the same period last year[12] - Net loss per share (diluted) for the three months ended November 2, 2024, was$0.78, compared to $0.19 in the same period last year[9] - Net loss for the quarter ending November 2, 2024, was$676.3 million[13] - Net loss for the nine months ended November 2, 2024, was $1,085.2 million, compared to$540.7 million for the same period in 2023[17] - Net loss for the quarter ending October 28, 2023, was $164.3 million[15] - Net loss for the nine months ended October 28, 2023 was$540.7 million[17] - Net loss for the three months ended November 2, 2024 was $676.1 million (44.6$163.1 million (11.5% of net revenue) in the same period in 2023[131] - The company reported a net loss of $676.3 million for the three months ended November 2, 2024, and$1,085.2 million for the nine months ended November 2, 2024[96] - Basic and diluted net loss per share were $(0.78) for the three months ended November 2, 2024, and$(1.25) for the nine months ended November 2, 2024[96] Assets and Liabilities - Total assets as of November 2, 2024, were $19,715.6 million, down from$21,228.5 million as of February 3, 2024[7] - Cash and cash equivalents decreased to $868.1 million as of November 2, 2024, from$950.8 million as of February 3, 2024[7] - Total current liabilities as of November 2, 2024, were $1,763.6 million, down from$1,814.2 million as of February 3, 2024[7] - Total stockholders' equity decreased to $13,372.9 million as of November 2, 2024[13] - Accumulated deficit increased to$1,257.5 million as of November 2, 2024[13] - Total stockholders' equity was $15,233.4 million as of October 28, 2023[15] - Total assets decreased from$21,228.5 million as of February 3, 2024 to $19,715.6 million as of November 2, 2024[7] - Total liabilities decreased from$6,397.1 million as of February 3, 2024 to $6,342.7 million as of November 2, 2024[7] - Cash and cash equivalents decreased from$950.8 million as of February 3, 2024 to $868.1 million as of November 2, 2024[7] - Accounts receivable decreased from$1,121.6 million as of February 3, 2024 to $997.9 million as of November 2, 2024[7] - Inventories decreased slightly from$864.4 million as of February 3, 2024 to $859.4 million as of November 2, 2024[7] - Total stockholders' equity decreased from$14,831.4 million as of February 3, 2024 to $13,372.9 million as of November 2, 2024[7] - Retained earnings as of October 28, 2023 decreased to$427.9 million from $1,123.5 million at the beginning of the year[15] - Inventories as of November 2, 2024, were$859.4 million, compared to $864.4 million as of February 3, 2024[100] - Property and equipment, net, as of November 2, 2024, were$781.9 million, compared to $756.0 million as of February 3, 2024[100] - Other non-current assets as of November 2, 2024, were$1,165.8 million, compared to $1,506.9 million as of February 3, 2024[100] - Accrued liabilities as of November 2, 2024, were$825.2 million, compared to $1,032.9 million as of February 3, 2024[102] - Other non-current liabilities as of November 2, 2024, were$613.6 million, compared to $524.3 million as of February 3, 2024[103] - Accumulated other comprehensive income (loss) as of November 2, 2024, was$(0.3) million, compared to $(1.4) million as of February 3, 2024[104] - The carrying value of goodwill as of November 2, 2024 was$11.6 billion[40] - Net carrying amounts of acquired intangible assets as of November 2, 2024 were $2,621.7 million for developed technologies,$741.6 million for customer contracts, and $14.7 million for trade names[41] - The fair value of the company's Level 1 assets, primarily marketable equity investments, is$9.3 million, while Level 2 assets, including time deposits and severance pay funds, total $49.8 million[48] - The carrying value of non-marketable equity investments is$49.4 million as of November 2, 2024, classified as Level 3 in the fair value hierarchy[50] - The estimated aggregate fair value of the company's unsecured senior notes is $3.4 billion as of November 2, 2024, classified as Level 2 in the fair value hierarchy[52] - Total outstanding debt as of November 2, 2024, is$4,123.3 million, with a net carrying amount of $4,094.9 million after adjusting for unamortized debt discount and issuance costs[54] - The 5-Year Tranche Loan under the 2024 and 2026 Term Loan Agreement has an outstanding principal of$623.4 million as of November 2, 2024, with an effective interest rate of 4.980%[57] - The 2023 Revolving Credit Facility has a borrowing capacity of $1.0 billion, with an unused commitment fee rate of 0.175$500.0 million in 5.750% Senior Notes due 2029 and $500.0 million in 5.950$1.0 billion in borrowings outstanding from the 2029 and 2033 Senior Notes as of November 2, 2024[64] - The company has $2.0 billion in borrowings outstanding from the 2026, 2028, and 2031 Senior Notes as of November 2, 2024[67] - The company has$499.9 million in borrowings outstanding from the MTI 2028 Notes and MTG 2028 Notes as of November 2, 2024[73] - The company's aggregate future contractual maturities of outstanding debt as of November 2, 2024, total $4,123.3 million[76] - The company's total future unconditional purchase commitments as of November 2, 2024, are$1,743.4 million for foundries and test & assembly partners, and $390.3 million for technology license fees[79] - The company has agreed to purchase level commitments of at least$615.1 million of wafers, substrates, and other manufacturing products for the remainder of fiscal 2025 through fiscal 2033 under capacity reservation agreements[82] - The company has aggregate remaining fees of $268.5 million payable quarterly over a 10-year technology licensing agreement term[83] - The company reserved$50.0 million in relation to a contractual disagreement with a customer influenced by restructuring actions in the third quarter of fiscal 2025[85] - The company recognized approximately $198.0 million of charges for product-related claims, which were fully resolved in the fourth quarter of fiscal 2024[86] - The company's restructuring liability balance as of November 2, 2024, was$365.7 million, including $358.9 million for exit-related costs and$6.8 million for employee severance[37] - Restructuring liability includes $120.8 million in accrued liabilities and$8.0 million in accounts payable[39] - Goodwill carrying value as of November 2, 2024, and February 3, 2024, was $11.6 billion[40] - Net carrying amount of acquired intangible assets as of November 2, 2024, was$2,957.7 million, with $240.1 million impairment charges recognized[41] Expenses and Charges - Research and development expenses for the three months ended November 2, 2024, were$488.6 million, up from $481.1 million in the same period last year[9] - The company recognized$715.1 million in restructuring and related charges for the three and nine months ended November 2, 2024, including $159.0 million impairment of capitalized purchased technology licenses[34] - Restructuring charges included$240.1 million impairment of acquired intangible assets, $159.0 million impairment of purchased technology licenses, and$97.8 million related to future service payment obligations[34] - The company initiated a restructuring plan in fiscal 2025 to increase R&D investment in the data center end market and reduce investment in other end markets, resulting in asset impairment charges[33] - The company expects the Fiscal 2025 restructuring plan to be substantially completed by the end of fiscal 2026[34] - The current portion of the restructuring liability as of November 2, 2024 was $128.8 million, with$120.8 million included in accrued liabilities and $8.0 million in accounts payable[39] - Estimated future amortization expense of acquired intangible assets for the remainder of 2025 is$247.0 million, with total future amortization expenses reaching $2,621.7 million[45] - Amortization expense for acquired intangible assets was$264.9 million for the three months ended November 2, 2024 and $805.5 million for the nine months ended November 2, 2024[44] - The company recognized$715.1 million in restructuring charges for the three months ended November 2, 2024, primarily due to impairment of acquired intangible assets ($240.1 million) and purchased technology licenses ($159.0 million)[34] - Restructuring charges for the nine months ended November 2, 2024, totaled $723.2 million, including$240.1 million for impairment of acquired intangible assets and 159.0 million for purchased technology licenses[37] - The company's Fiscal 2025 Plan aims to increase R&D investment in the data center market and reduce investment in other end markets, resulting in 715.1 million in restructuring charges for the three months ended November 2, 2024[33] - Restructuring charges of $715.1 million were recognized in Q3 FY2025, primarily for impairment and write-offs of intangible assets, inventories, and property, as well as severance and other termination benefits[122] - Research and development expenses remained relatively flat at$488.6 million (32.2% of net revenue) for the three months ended November 2, 2024 compared to the same period in 2023[136] - Selling, general and administrative expenses decreased by $7.7 million to$205.3 million (13.6% of net revenue) for the three months ended November 2, 2024 compared to the same period in 2023[137][139] - Restructuring related charges increased significantly to $358.3 million (23.6$3.4 million in the same period in 2023[140] - Interest and other loss, net increased by $6.5 million to$47.7 million (3.1% of net revenue) for the three months ended November 2, 2024 compared to the same period in 2023, primarily due to exchange rate fluctuations[141] - The company recognized $45.6 million and$138.9 million in interest expense for the three and nine months ended November 2, 2024, respectively[75] - Depreciation and amortization for the nine months ended October 28, 2023 was $226.0 million[17] - Amortization of acquired intangible assets for the nine months ended October 28, 2023 was$811.6 million[17] - Amortization expense for acquired intangible assets for the three months ended November 2, 2024, was $264.9 million, and for the nine months, it was$805.5 million[44] - Estimated future amortization expense of acquired amortizable intangible assets as of November 2, 2024, is $2,621.7 million, with$247.0 million expected in the remainder of 2025[45] Cash Flow and Financing - Net cash provided by operating activities for the nine months ended November 2, 202