Marvell Shares Slide as Investors Overlook Strong Results Amid Google Deal Concerns
Marvell Technology's shares fell by nearly 8% in premarket trading on Friday after concerns over the timing of revenue from its AI chip deal with Google overshadowed the company's better-than-expected quarterly results. The semiconductor designer secured a custom-chip deal last week with Alphabet's Google, which is expected to generate up to $120 billion in revenue by fiscal 2033.
The deal will make Google one of Marvell's largest shareholders. However, investors are focusing on when the deal's revenue contribution will be reflected in the company's financials. Analysts at Morgan Stanley stated that expectations were higher due to the Google deal, but its contribution is already largely factored into prior guidance.
Marvell CEO Matt Murphy explained that the company's custom revenue targets through fiscal year 2028 already include some Google-related revenue and will contribute significantly more in fiscal year 2029. Shares of Marvell have nearly tripled this year, emerging as a major winner from the AI infrastructure boom.