Marvell Technology(US:MRVL) Hua Er Jie Jian Wen·2025-12-03 03:48Core Viewpoint - Marvell Technology's stock surged after the company provided a strong growth forecast for its data center business, overshadowing a lackluster overall earnings outlook, which renewed investor confidence in the custom chip manufacturer [1][3]. Financial Performance - Marvell reported a third-quarter adjusted EPS of $0.76 and revenue of $2.08 billion, slightly exceeding analyst expectations of $0.74 EPS and $2.07 billion revenue [4]. - The data center business, a key revenue driver, saw a 38% year-over-year revenue increase, reaching $1.52 billion, slightly above Wall Street's expectation of $1.51 billion [4]. Future Guidance - The company provided a cautious outlook for the fourth quarter, expecting an adjusted EPS of $0.79 (with a $0.05 margin) and revenue of $2.2 billion (with a 5% margin), aligning closely with analyst predictions [4]. - CEO Matt Murphy's forecast of over 25% year-over-year growth in data center revenue for the next fiscal year significantly boosted market sentiment [3][4]. Acquisition Plans - Marvell announced plans to acquire AI startup Celestial AI for approximately $3.25 billion in cash and stock, which was not included in the optimistic revenue forecast [5]. Market Dynamics - Despite an 83% stock price increase in 2024, Marvell's stock has declined by 16% year-to-date, reflecting investor concerns about the company's ability to secure long-term orders amid intense competition [6]. - The market's skepticism centers around the prospects of custom ASIC chips, which are tailored for specific applications and seen as potential alternatives to NVIDIA's GPUs [6]. Analyst Perspectives - UBS analyst Timothy Arcuri noted that most customers are diversifying their supply chains, using multiple GPU and ASIC suppliers, which could benefit companies like Marvell [7]. - Arcuri maintains a "Buy" rating on Marvell with a target price of $110, suggesting that the company's strong guidance supports a positive outlook [7].