MW As Marvell's stock rises on an upbeat forecast, analysts still have these questions

By Britney Nguyen

Marvell clearly has visibility into big financial opportunities, but analysts wonder about its competitive positioning and the impact of a newly announced deal

Marvell's stock was up about 8% on Wednesday.

Marvell Technology's upbeat guidance had Wall Street cheering on Wednesday, but some analysts weren't quite ready to pronounce a turnaround for the chip company, which has thus far been unable to capitalize on the artificial-intelligence boom to the degree seen by its larger competitors.

The company expects to double its fiscal 2028 silicon business, noted TD Cowen analyst Joshua Buchalter, and it inked a deal to buy Celestial AI, which could open up new opportunities. That news "gives bulls plenty to point to," Buchalter wrote.

Still, Marvell $(MRVL)$ has "a lot to prove" in the second half of next year when it is expected to ramp some custom chip projects, he added.

Most of the TD Cowen team's upward revisions for Marvell's data-center revenue are for fiscal year 2028 and beyond. That's when the company's second custom-chip program - which Buchalter believes is Microsoft's $(MSFT)$ Maia AI accelerator - is expected to ramp up.

The big change on the latest call, in Buchalter's view, was Marvell's "relatively unequivocal commentary" on its next-generation custom chips and disclosure that it has purchase orders for all of fiscal year 2027. That marked "a shift in tone from last quarter during which management effectively declined to comment," Buchalter said.

The next-generation XPU likely refers to Amazon.com's (AMZN) Trainium3, Buchalter noted. Amazon announced the new chip for AI training during its re:Invent event on Tuesday.

Marvell shares rose about 8% on Wednesday.

See more: Why Marvell's stock is soaring after earnings

Cantor Fitzgerald analyst C.J. Muse said the company "clearly has renewed confidence on the stickiness of its current business" with Amazon and Microsoft.

However, Muse said in a Tuesday note that he and his team will "continue to worry about" Marvell's stickiness with customers as competition rises in the custom-chip space with Google's tensor processing units gaining more attention and Nvidia making pricing more efficient.

"But clearly visibility has improved for the company," Muse said.

Meanwhile, Marvell's acquisition of Celestial AI will be a boost for its copackaged optics technology in its custom chips and scale-up switching, Buchalter said. That should make the company "a stronger contender" in the fastest-growing segment for networking through the end of the decade, he added.

Jefferies analyst Blayne Curtis said that, while the acquisition helps Marvell fill a gap in its co-packaged optics business, "the jury is still out given revenue isn't expected to ramp until" the fourth quarter of fiscal year 2028.

See also: Is Marvell's stock cheap? This $1 billion move shows the company seems to think so.

-Britney Nguyen

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December 03, 2025 19:24 ET (00:24 GMT)

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