With the global AI infrastructure expansion accelerating, Wall Street analysts widely anticipate that Marvell Technology (MRVL.US), a leader in customized AI ASIC chips for large-scale data centers, will experience "substantial and robust growth" over the next two years. Following strong earnings and an optimistic outlook, analysts have raised their 12-month price targets for Marvell, highlighting the cost-efficiency advantages of AI ASICs over Nvidia’s GPU solutions amid surging demand for cloud-based AI inference workloads.
Marvell’s Q3 FY2026 results (ended November 1) and guidance for the next quarter exceeded average Wall Street estimates, with its data center business outlook particularly impressing analysts. Management projects Q4 revenue of approximately $2.2 billion (±5%), surpassing the consensus estimate of $2.18 billion—a figure already revised upward after strong earnings from tech giants like Google, Amazon, and Nvidia in late October. This underscores explosive demand for AI ASIC-powered infrastructure, with Marvell and rival Broadcom (AVGO.US) sustaining growth momentum since 2023.
Non-GAAP EPS is forecast between $0.74 and $0.84 (midpoint above expectations), with gross margins of 58.5%–59.5%. During the earnings call, CEO Matt Murphy projected FY2027 revenue near $10 billion, including 25% growth in data center sales. Custom ASIC revenue is expected to rise ~20% next year, potentially doubling by FY2028.
The generative AI wave has accelerated chip development, with cloud providers racing to deploy high-performance, energy-efficient ASIC clusters. Marvell and Broadcom collaborate with Amazon and Google to design tailored AI ASIC solutions, a now-critical business segment. For instance, Broadcom’s TPU clusters with Google exemplify this approach. Meta is reportedly considering multi-billion-dollar TPU purchases for its AI data centers by 2027, while Salesforce plans to adopt Google’s Gemini 3 model—further validating the ASIC ecosystem.
Marvell’s shares surged 7.87% to $100.20 on Wednesday, nearing a 10% intraday peak. Analysts dismissed concerns over lost Amazon Trainium 3-related revenue, citing robust demand for XPU-attached custom ASICs. Morgan Stanley’s Joseph Moore raised his target to $112 from $86, calling 20% CY2026 growth "achievable" and 100% CY2027 growth "remarkable," though contingent on securing a major cloud provider’s ASIC project.
Jefferies’ Blayne Curtis noted Marvell’s raised guidance post-September "AI Day," with 20%+ ASIC growth and firm purchase orders. Microsoft’s Maia 300 accelerator (akin to Google TPUs) could drive FY2028 revenue doubling, while another hyperscaler XPU win and optical business growth (~30% vs. prior 18%) add momentum. Celestial AI’s acquisition bolsters Marvell’s CPO roadmap. Curtis lifted his target to $120 from $80, reiterating "Buy."
Needham’s N. Quinn Bolton also hiked his target to $120 from $90, praising Marvell’s diversified high-margin portfolio in cloud/5G/auto infrastructure. JPMorgan, Piper Sandler, RothMKM, Keybanc, and Wells Fargo analysts see further upside, with some predicting shares surpassing $130 in 12 months.