Goldman Sachs Reiterates Neutral Rating on Marvell

Goldman Sachs analyst James Schneider reiterated a Neutral rating and $125.00 price target on Marvell Technology (NASDAQ: MRVL).

“Key stock takeaways: We expect the stock to trade modestly higher following guidance that was ahead of the Street, in light of management’s commentary about continued revenue acceleration and an uplift to FY27/28 guidance (not quantied).

We believe investor expectations were elevated heading into the quarter based on peers’ reports, and robust spending at key customers.

From here, we believe stock performance is likely to hinge on the magnitude of Marvell’s custom compute ramp in 2H and upside to its overall Datacenter business.

On the conference call, we expect investors to focus on: (1) any potential updates to CY2026/27 Datacenter revenue growth targets; (2) management commentary on potential Google ASIC partnership; (3) impact of agentic AI on company fundamentals.

Quarterly results were in line with the Street: Marvell reported revenue of $2.42 bn, in line with GS at $2.40 bn and the Street at $2.41 bn.

Gross margin of 58.9% was in line with GS at 58.7% and the Street at 58.8%. Operating margin of 35.0% was in line with GS at 34.8% and the Street at 35.0%.

Operating EPS of $0.80 was in line with GS at $0.79 and the Street at $0.80. Data Center revenue of $1.83 bn was in line with GS and the Street at $1.83 bn.

Communications and Other revenue of $585 mn was above GS at $569 mn and the Street at $580 mn. 2Q revenue guidance is above the Street.

Marvell guided 2Q revenue above the Street, with gross margin in line and EPS above. Revenue was guided to $2.70 bn at the midpoint, which is above GS at $2.61 bn and the Street at $2.62 bn.

Non-GAAP gross margin was guided to 58.75%, above GS at 58.5% and the Street at 58.6%. OpEx was guided to $600 mn.

Non-GAAP EPS (ex SBC) of $0.93 at the midpoint is above GS at $0.90 and the Street at $0.91. Price target and risks: We are Neutral rated on MRVL.

Our 12-month target price of $125 is based on a 28X P/E multiple applied to our normalized EPS estimate of $4.50.

Key upside risks: (1) strongerthan-expected ramp in custom compute; (2) stronger-than-expected recovery in traditional businesses.

Key downside risks: (1) slowdown in overall AI spending; (2) share loss in custom compute.”

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