Strong AI demand will translate into a 'beat-n-raise' quarter from this chip co

Investing.com-- Marvell Technology Inc (NASDAQ: MRVL) is expected to report better-than-expected earnings for the October quarter and provide a stronger-than-anticipated outlook for the January quarter, given robust demand for artificial intelligence (AI) products, according to a Rosenblatt Securities note.

The chipmaker will report third-quarter results on Dec. 3 after market close.

Analysts at Rosenblatt forecast a "beat-and-raise" quarter, projecting revenue around $1.45 billion, and non-GAAP per share profit of about 40 cents.

The note said Marvell will be benefitted from the AI momentum, particularly in data centre application-specific integrated circuits (ASICs), networking, and electro-optics. Recovery in enterprise networking, storage, and carrier infrastructure is expected to drive growth in the company.

Rosenblatt sees continued AI strength boosting Marvell's revenue guidance for the January quarter above consensus expectations of $1.65 billion, a 15% year-over-year increase. The analysts believe management may signal upside potential to its recently revised AI sales targets of $1.5 billion for fiscal 2025 and $2.5 billion for fiscal 2026.

"We see a solid setup for Marvell as we enter CY25 driven by a substantial ramp in custom silicon programs, as well as robust bookings," Rosenblatt said, reiterating its "buy" rating and $120 price target.

For fiscal 2026, Rosenblatt projects 31% revenue growth to $7.2 billion, driven by AI-related products and increased market share.

Brokerage’s target price on Marvell represent a roughly 30% upside, as investors bet on rising demand for chips in AI-driven applications.

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