Marvell Raises Outlook Amid Growing Demand for Custom AI Chips

In its latest quarterly report, Marvell disclosed revenue of $2.739 billion, marking a 37% increase year-over-year. The Data Center segment experienced a 46% growth. The company has raised its revenue forecast for FY2027 to $12 billion and for FY2028 to $18 billion, citing strong demand for custom AI accelerators.

CEO Matt Murphy highlighted that revenue from custom chips is expected to more than double next year, as hyperscalers increasingly develop their own solutions instead of relying on Nvidia. Despite this optimistic outlook, the impact of large contracts with Google will only be felt in 2029, which has led to a decline in Marvell's stock. This underscores that transitioning to proprietary AI accelerators takes years, even as demand accelerates rapidly.