By Katherine Hamilton

Marvell Technology shares slid after the company's outlook showed its deal with Amazon isn't expected to boost earnings as much as many investors had hoped.

The stock fell 18% to $74.11 Thursday morning. It has lost more than a third of its value in the past three months.

Marvell, which makes semiconductors for data centers, posted an earnings outlook just ahead of expectations, but many investors were disappointed that its deal to provide chips to Amazon didn't boost guidance more, analysts said.

Marvell's fourth-quarter revenue of $1.82 billion squeaked past Wall Street's estimate of $1.80 billion. It gave a mid-point guidance of $1.88 billion for first-quarter revenue, just ahead of the $1.87 billion expected by analysts, according to FactSet. And its adjusted earnings per share outlook of 61 cents was in line with Wall Street's expectations.

"The magnitude of this beat was likely disappointing for most," Susquehanna International Group analyst Christopher Rolland said in a note.

In December, Marvell signed a five-year deal to provide custom chips to Amazon Web Services. Marvell's production of custom silicon chips for Amazon is now in high-volume production, Rolland said, giving investors hope that it would drive a stronger sales outlook.

But the percentage of sales growth for data centers sales were guided to grow in the mid-single digits quarter over quarter, while AI and cloud sales are expected to grow in the double digits, Rolland said. Both imply a more modest boost from Amazon, he said.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

By Katherine Hamilton

Marvell Technology shares slid after the company's outlook showed its deal with Amazon isn't expected to boost earnings as much as many investors had hoped.

The stock fell 18% to $74.11 Thursday morning. It has lost more than a third of its value in the past three months.

Marvell, which makes semiconductors for data centers, posted an earnings outlook just ahead of expectations, but many investors were disappointed that its deal to provide chips to Amazon didn't boost guidance more, analysts said.

Marvell's fourth-quarter revenue of $1.82 billion squeaked past Wall Street's estimate of $1.80 billion. It gave a mid-point guidance of $1.88 billion for first-quarter revenue, just ahead of the $1.87 billion expected by analysts, according to FactSet. And its adjusted earnings per share outlook of 61 cents was in line with Wall Street's expectations.

"The magnitude of this beat was likely disappointing for most," Susquehanna International Group analyst Christopher Rolland said in a note.

In December, Marvell signed a five-year deal to provide custom chips to Amazon Web Services. Marvell's production of custom silicon chips for Amazon is now in high-volume production, Rolland said, giving investors hope that it would drive a stronger sales outlook.

But the percentage of sales growth for data centers sales were guided to grow in the mid-single digits quarter over quarter, while AI and cloud sales are expected to grow in the double digits, Rolland said. Both imply a more modest boost from Amazon, he said.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

March 06, 2025 10:31 ET (15:31 GMT)

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