Marvell Technology shares jumped more than 22% in premarket trading on Tuesday following a high-profile endorsement from Nvidia CEO Jensen Huang, who referred to Marvell as the next "trillion-dollar company." The comment was made as the two executives appeared together at a Computex event in Taipei this week.
Last week, Marvell provided forward-looking figures for its custom silicon business, saying it could surpass $10 billion in revenue by fiscal 2029. The company attributed that potential growth to cloud service providers expanding AI data centers and increasing their investment in bespoke chips to reduce reliance on Nvidia processors.
Marvell also highlighted that rising AI adoption is lifting demand for specialized chips and for the company's interconnect technologies. These interconnect solutions are used in data centers to link the large clusters of processors necessary for training and operating AI models, the company said.
Alongside its commentary on custom silicon, Marvell increased its revenue forecast for fiscal 2028 to approximately $16.5 billion, up from a previous estimate of $15 billion. The company noted that market dynamics tied to AI and cloud infrastructure are central to that revision.
Marvell's stock performance has been notably strong this year, having more than doubled on a year-to-date basis prior to the premarket surge triggered by Huang's remarks.
At Computex in Taipei, Huang and Marvell CEO Matt Murphy shared a stage as Nvidia introduced a new chip aimed at bringing artificial intelligence capabilities directly into laptops and desktop computers. Nvidia positioned the new RTX Spark PC chip as part of a broader effort, in collaboration with Microsoft, to "reinvent the PC" for the AI era. Nvidia described that effort as building on three years of cooperation with Microsoft.
Key takeaways
- Marvell shares rose sharply after public praise from Nvidia's CEO and the company’s bullish guidance for its custom chip business.
- Marvell projects over $10 billion in custom chip revenue by fiscal 2029 and raised its 2028 revenue outlook to about $16.5 billion, citing AI-driven demand.
- The developments affect multiple market segments, including cloud and data center hardware, the semiconductor supply chain, and the PC market as vendors introduce AI-capable chips.
- Marvell's growth projection depends on cloud providers building out AI data centers and increasing investment in custom silicon.
- The company aims to reduce dependence on Nvidia processors through custom designs, a strategy whose outcome is uncertain.
- Competition in bringing AI capabilities to PCs is active, with Nvidia positioning its new RTX Spark PC chip against offerings from Advanced Micro Devices, Intel and Apple.
While the immediate market reaction was significant, the company’s future performance remains tied to the pace of AI adoption, the extent of cloud provider investment in custom silicon, and competitive dynamics in both the data center interconnect space and the emerging market for AI-enabled personal computers.