Marvell Technology Expects Growth in Data-Center Business

Marvell Technology Inc. is anticipating an upturn in its data-center business in the current quarter, despite lower-than-expected overall guidance. The chip company reported a net loss of $164.3 million, or 19 cents a share, for the fiscal third quarter compared to a net income of $13.3 million, or 2 cents a share, in the same period last year. Adjusted earnings per share came in at 41 cents, down from 57 cents a year ago, slightly surpassing analysts’ expectations of 40 cents.

Although revenue dropped from $1.54 billion to $1.42 billion, it exceeded the FactSet consensus of $1.40 billion. Data-center revenue saw an 11% decline to $556 million, but performed well sequentially with more than 20% growth, and the company anticipates over 30% sequential growth for the end market in the fiscal fourth quarter.

Marvell’s stock witnessed a more than 2% increase in Thursday’s extended session.

According to Chief Executive Matt Murphy, Marvell’s strong growth in artificial intelligence (AI) and cloud technology is compensating for a softening demand in other end markets. As a result, the company forecasts overall revenue to remain flat sequentially in the fourth quarter.

For the fiscal fourth quarter, Marvell expects overall revenue of $1.42 billion at the midpoint, underperforming analysts’ expectations of $1.46 billion. The company also anticipates adjusted earnings per share of 46 cents at the midpoint, compared to analysts’ projections of 49 cents.