On August 28, Marvell Technology fell 3.31% in after-hours trading to $235.5/share, with turnover of $311 million, despite reporting fiscal Q2 results that topped expectations.

The company posted adjusted EPS of $0.94, beating the $0.92-$0.93 consensus estimate, while revenue of $2.739 billion exceeded the $2.71 billion forecast, representing 36% year-over-year growth. Fiscal Q3 guidance was also above expectations, with projected adjusted EPS of $1.10 (±$0.05) on revenue of $3.15 billion (±5%), versus analyst estimates of $1.08 EPS and $3.04 billion in revenue.

However, the beat margins were modest, and the stock had already rallied over 10% in the week leading up to earnings as Wells Fargo, HSBC, UBS, Susquehanna, and other institutions aggressively raised price targets. This pre-earnings run-up effectively priced in the upside, resulting in a classic sell-the-news reaction upon release.

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