Marvell Technology on Thursday reported fiscal second-quarter revenue of $2.739 billion, a new quarterly record that represents a 37% increase from the same period last year, driven by explosive growth in its data center AI chip business.
Non-GAAP earnings per share came in at $0.94, beating the analyst consensus of $0.93 by one cent. The company's gross margin expanded to 58.9% on a non-GAAP basis, up from 53.1% a year earlier, reflecting a shift toward higher-margin AI accelerator products.
Despite the earnings beat, Marvell shares fell approximately 7% in after-hours trading. Analysts pointed to the company's heavy reliance on a small number of hyperscale customers — particularly [redacted] — for its AI chip revenue, raising concerns about concentration risk. Investors also weighed the results against Nvidia's dominant market position in AI accelerators, which reported record $96.2 billion in quarterly revenue just two days earlier.
Marvell also raised its full-year fiscal 2027 revenue guidance to approximately $12 billion, up from a prior forecast near $11.5 billion, signaling continued strong demand for its custom AI silicon. The company has been positioning itself as a key supplier of custom AI chips for major cloud providers, competing with Nvidia's off-the-shelf GPU solutions by offering tailored designs optimized for specific AI workloads.
The data center segment, which now accounts for the vast majority of Marvell's revenue, grew sharply as cloud providers continued ramping up AI infrastructure spending. The company's custom silicon and networking products for AI clusters have become a significant growth driver, with several major customer wins in the past year.
The stock decline suggests that even strong results may not be enough to satisfy investors who have bid up AI chip stocks to premium valuations. Marvell's shares have more than doubled over the past year on AI enthusiasm, leaving the stock vulnerable to profit-taking on any sign that growth may be decelerating.
