This earnings season has been strange, as many semiconductor and tech stocks sold off quickly after the report, even when they beat estimates. Even as chip leader Nvidia ( NVDA ) cooled off after the deadline, investors analyzed supply, demand, and margin dynamics.
However, in the case of Marvell Technologies (MRVL), it is completely different. Shares of MRVL rose, posting a double-digit jump after a strong beat and higher outlook. Analysts say they have renewed “confidence” in Marvel’s ability to monetize the AI boom.
Several analyst firms, including Bank of America, downgraded their ratings after the publication, pointing to Marvell’s expanding custom-AI programs and winning optical communications with hyperscalers as key catalysts. If you’re weighing whether to buy it now, the case boils down to two questions: Can Marvell keep data center revenue afloat and turn a large tailwind of cash into sustainable margin expansion?
Below is a closer look at the numbers and what Wall Street is saying.
Marvell is a leader in data infrastructure semiconductors. These are chips, power switches, optical connections, ASICs, and accelerators at major cloud and telecommunications companies. The company reported record revenue in 2026, which showed 42% growth over the previous year. CEO Matt Murphy notes that “strong demand for AI” has fueled Marvell’s growth, and design wins reached an all-time high in FY2026. Its products now serve the data center and telecommunications end markets in the cloud and enterprise.
Beyond its core growth story, the company is also strengthening its technology portfolio to capitalize on the AI boom. In late 2025, it announced the acquisition of Celestial AI, a photonics interconnect startup, and XConn Technologies. Both deals close in fiscal 2027 and expand Marvel’s AI-based product lineup. This has been hailed as a positive catalyst by investors. Combined with record design wins and bookings, they paint a sharp picture.
Over the past six months, MRVL shares have soared amid the AI chip boom. Marvel stock is up about 40% from last September’s low. This good performance came on the heels of Marvel’s fundamentals, strong bookings, and strong pipeline.
Even after the rally, valuations suggest the stock may still have room to run. From a value standpoint, Marvel still looks interesting. In 2027, its P/E is roughly 16×, well below the 29× average for large-cap peers. Similarly, its EV/Sales is only 4× versus 9× for similar companies. In other words, MRVL is trading at a steep discount to the sector despite its rapid growth. Even Goldman Sachs notes that Marvell’s price-to-earnings growth (PEG) is too low at 0.1.
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In its Q4 earnings results, Marvel beat previous analyst estimates with a strong beat. Revenue reached $2.219 billion, up 22% year-over-year (YoY). Data center sales, which account for nearly three-quarters of total revenue, reached $1.651 billion, a 21% increase, while telecommunications and other segments generated about $567 million, up 26%.
GAAP net income rose to $396 million, compared to $200 million a year ago as profitability remained strong. On an adjusted basis, profit came in at $0.80 per share, above Wall Street’s forecast of $0.79.
The company also generated $373.7 million in operating cash flow and ended the quarter with about $948 million in cash and equivalents. Free cash flow and liquidity remained strong despite recent acquisitions.
Management was obviously pleased. CEO Murphy said, “We delivered record 2026 financials, growing 42% year over year, driven by strong demand for AI.” He noted that “bookings are at a record pace” and design wins in FY2026 are at an all-time high, setting the stage for continued growth. This belief helped Marvel increase its direction. For Q1 2027, it sees revenue of around $2.40 billion ± 5% with EPS close to $0.79.
More impressively, management now projects about 40% annual revenue growth to $11 billion in fiscal 2027, led by the data center segment. As a result, Wall Street analysts raised their numbers; BofA now forecasts FY2027 EPS of $3.82 and FY2028 of $5.43, up 34% and 42% YoY.
Investors cheered on the earnings, sending the stock up more than 10% after the results. Bank of America’s Vivek Arya attributed the jump to “strong revenue breakdown, outlook revisions, and analyst upgrades” around Marvell’s AI connectivity products. He upgraded the stock to “buy” from “neutral,” citing “increased confidence” in Marvell’s position in AI optical communications and custom chip programs.
The Wall Street analyst community has been uniformly more positive about Marvell Technologies after the quarter, raising targets and citing a clear line of sight to AI-driven demand.
Bank of America and RBC Capital quickly raised targets to $110 and $115, pointing to strong guidance and expanding custom-ASIC and interconnect pipelines.
Morgan Stanley emphasized management confidence and strong theoretical appeal.
The highest call came from KeyBanc, which set a $130 target on the stock. Analysts widely point to accelerating data center bookings, including custom programs with Amazon ( AMZN ) and Microsoft ( MSFT ), as the primary upside driver. A minority warns of cyclical chip risk and increasing competition.
If we take an overall look, Wall Street’s total is very high with a consensus “Strong Buy” rating from the 35 analysts covering it. Furthermore, the price target set by the bullish group is $119, which suggests that even after the bull run, there is still room for a 25% upside from current levels.
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As of the date of publication, Nauman Khan had no position (either directly or indirectly) in any of the matters mentioned in this article. All information and data in this article are for informational purposes only. This article was originally published on Barchart.com
