Chipmaker Marvell Technology reported strong earnings and sales in its fiscal first quarter, beating estimates and providing upbeat guidance for the current period. Despite the positive news, Marvell stock fell in extended trading.
The Santa Clara-based company posted adjusted earnings of 24 cents per share on sales of $1.16 billion, in line with expectations. However, on a year-over-year basis, Marvell’s earnings dropped 23% while sales fell 12%.
Marvell attributed its revenue beat to stronger-than-expected demand for AI infrastructure chips, particularly from cloud service providers like Amazon and Alphabet’s Google. CEO Matt Murphy highlighted the company’s 87% year-over-year growth in data center revenue, driven by custom AI programs and electro-optics sales.
For the upcoming quarter, Marvell forecasted adjusted earnings of 29 cents per share on sales of $1.25 billion, surpassing analyst estimates. In the same period last year, the company reported earnings of 33 cents per share on sales of $1.34 billion.
Despite the positive outlook, Marvell stock dipped over 4% in after-hours trading to $73.38. The stock closed at $76.85 during the regular session. Marvell stock is currently in a buy range, with a buy point of $76.29 and a 5% buy zone extending to $80.10.
Marvell’s stock ranks eighth out of 39 stocks in the fabless chipmaker industry group, with an IBD Composite Rating of 90 out of 99. Investors can follow Patrick Seitz on Twitter at @IBD_PSeitz for more updates on consumer technology, software, and semiconductor stocks.