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Investing.com -- Marvell Technology Inc (NASDAQ:MRVL) posted record-breaking revenue in the first quarter of fiscal 2026, but shares dipped nearly 4% in premarket trading as results largely aligned with forecasts.
Despite a year-on-year top-line growth of 63%, investors appeared to seek signs of stronger outperformance from the semiconductor maker amid AI-driven industry expectations.
The company reported net revenue of $1.895 billion, slightly ahead of the $1.88 billion analyst consensus and $20 million above the mid-point of its prior guidance. Non-GAAP diluted earnings were $0.62 per share, in line with Wall Street expectations, while GAAP earnings reached $0.20 per share for the quarter.
“This momentum is being fueled by strong AI demand in the data center end market, where our revenue is benefiting from the rapid scaling of our custom silicon programs and robust shipments of our electro-optics products,” said Matt Murphy, Marvell’s Chairman and CEO. He added, “As the industry continues to move toward building custom AI infrastructure, Marvell is uniquely positioned at the center of this transformation.”
Alongside the latest financials, one highlight of the report was Marvell’s reaffirmation of its key custom chip partnerships.
The company confirmed participation in Amazon’s 3nm custom chip program. "We assume as before they will do a separate (from Alchip) but equally important chip that likely matters more in 2H26E," Bank of America analysts said.
Marvell also highlighted multi-generation custom chip programs with Microsoft (NASDAQ:MSFT) beginning in calendar year 2026.
"While limited EPS revisions likely keep stock in check near-term, we believe MRVL’s pipeline affirmation, likely endorsed in more detail at upcoming Jun-17 analyst event, will improve confidence in the 20%+ sales growth trajectory," analysts led by Vivek Arya added.
Separately, Barclays (LON:BARC) analysts said Marvell "remains a show me story on the ASIC side until we get clarity on share dynamics, but we like the risk reward at ~$60."
Marvell reported non-GAAP gross margins of 59.8%, with GAAP gross margins standing at 50.3%. Operational cash flow came in at $332.9 million, underlining strong capital generation during a quarter of robust product demand.
Looking ahead, management guided for second-quarter revenue of $2.0 billion, with non-GAAP EPS projected at $0.67 +/- $0.05, figures generally in line with current market expectations. Non-GAAP gross margin is forecast in the 59% to 60% range, maintaining profitability levels seen in Q1.
Despite those projections, investors responded cautiously to the company’s relatively measured outlook. The mild pullback suggests that the market may have priced in a stronger beat or more aggressive second-half guidance amid the ongoing AI infrastructure cycle.
Marvell is set to host a Custom AI Investor Event on June 17, highlighting product innovations and long-term market share ambitions in the AI infrastructure space. The event will include executive presentations and a live Q&A session with investors as the company looks to reinforce confidence in its custom silicon strategy.
As AI continues to reshape the semiconductor landscape, Marvell remains positioned as a key enabler in accelerating infrastructure transitions, yet market expectations appear to be racing ahead of incremental gains.
(Luke Juricic contributed to this report.)