Marvell Technology forecasts weak revenue as inventory corrections persist

Semiconductor firm Marvell Technology said on Thursday it expects nearly half of its quarterly revenue to decline in the first quarter of 2025, sending its shares down over 4% in afterhours trading. CEO Matthew Murphy attributed this drop in revenue to a tough macroeconomic environment and longer-than-expected inventory corrections. While the data center segment, which includes some AI and cloud systems, beat market expectations for revenue in the third quarter of 2024, Murphy added that going forward “the real question is the data center strength and how does that continue? and it’s too early to call” Advt Customers including cloud service providers and telecom operators continue to use existing chip inventory, after a cool down of the pandemic-fueled buying spree led to excess supply.

Clearing of inventory has dampened prospects of new orders for chip makers like Marvell . Murphy added on an earnings call that while Marvell does expect year-on-year growth going forward, he could not comment on concerns surrounding inventory build hindering growth projections for the first quarter. The company’s fourth-quarter forecast came in below Wall Street estimates.

For the current quarter, Marvell expects revenue of $1. 42 billion plus or minus 5%, which is below estimates of $1. 46 billion.

On an adjusted basis, the company expects income of 46 cents per share, plus or minus 5 cents for the fourth quarter. This compares to estimates of 49 cents profit per share. However, Marvell beat Wall Street estimates for third-quarter revenue and profit, as the rapid adoption of artificial intelligence (AI) buoyed demand for its chips.

Marvell posted net revenue of $1. 42 billion for the quarter ended Oct. 28, compared with analysts’ estimates of $1.

40 billion, according to LSEG data. Excluding items, the company posted a profit of 41 cents per share, marginally beating estimates of 40 cents per share. Reuters Published On Dec 1, 2023 at 07:47 AM IST Telegram Facebook Copy Link Be the first one to comment.

Comment Now COMMENTS Comment Now Read Comment (1) All Comments Post Post Find this Comment Offensive? Choose your reason below and click on the submit button. This will alert our moderators to take actions REASONS FOR REPORTING Foul Language Defamatory Inciting hatred against a certain community Out of Context / Spam Others Report Join the community of 2M+ industry professionals Subscribe to our newsletter to get latest insights & analysis. Download ETTelecom App Get Realtime updates Save your favourite articles Scan to download App Marvell Technology Marvell Technology revenue International Marvell data center {“@context”:”http://schema.

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indiatimes. com/news/devices/marvell-technology-forecasts-weak-revenue-as-inventory-corrections-persist/105640748″},”headline”:”Marvell Technology forecasts weak revenue as inventory corrections persist”,”datePublished”:”2023-12-01T07:47:04+05:30″,”dateModified”:”2023-12-01T07:49:20+05:30″,”expires”:”2023-12-31T05:53:54+05:30″,”articleBody”:”Semiconductor firm Marvell Technology said on Thursday it expects nearly half of its quarterly revenue to decline in the first quarter of 2025, sending its shares down over 4% in afterhours trading. CEO Matthew Murphy attributed this drop in revenue to a tough macroeconomic environment and longer-than-expected inventory corrections.

While the data center segment, which includes some AI and cloud systems, beat market expectations for revenue in the third quarter of 2024, Murphy added that going forward “the real question is the data center strength and how does that continue? and it’s too early to call” Customers including cloud service providers and telecom operators continue to use existing chip inventory, after a cool down of the pandemic-fueled buying spree led to excess supply. Clearing of inventory has dampened prospects of new orders for chip makers like Marvell. Murphy added on an earnings call that while Marvell does expect year-on-year growth going forward, he could not comment on concerns surrounding inventory build hindering growth projections for the first quarter.

The company’s fourth-quarter forecast came in below Wall Street estimates. For the current quarter, Marvell expects revenue of $1. 42 billion plus or minus 5%, which is below estimates of $1.

46 billion. On an adjusted basis, the company expects income of 46 cents per share, plus or minus 5 cents for the fourth quarter. This compares to estimates of 49 cents profit per share.

However, Marvell beat Wall Street estimates for third-quarter revenue and profit, as the rapid adoption of artificial intelligence (AI) buoyed demand for its chips. Marvell posted net revenue of $1. 42 billion for the quarter ended Oct.

28, compared with analysts’ estimates of $1. 40 billion, according to LSEG data. Excluding items, the company posted a profit of 41 cents per share, marginally beating estimates of 40 cents per share.

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com/news/devices/marvell-technology-forecasts-weak-revenue-as-inventory-corrections-persist/105640748″,”description”:”Murphy added on an earnings call that while Marvell does expect year-on-year growth going forward, he could not comment on concerns surrounding inventory build hindering growth projections for the first quarter. “,”author”:[{“@type”:”Thing”,”name”:”ET Telecom”,”url”:”https://telecom. economictimes.

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