Marvell raises 2028 revenue forecast on strong AI data center demand

By Prathik Jayaprakash, Anhata Rooprai and Max A. Cherney

Oct 6 (Reuters) – Marvell Technology raised its fiscal 2028 revenue forecast to about $20 billion on Tuesday, above Wall Street estimates, as demand for its custom data center chips grows along with a surge in AI spending.

Shares of the Santa Clara, California-based company rose about 6%, while those of rival Broadcom advanced about 4%.

“It took a long time to get this company on this path and to be a technology leader,” Chris Koopmans, Marvell’s president and chief operating officer, said in an interview. “We have a track record of doing what we said we’re going to do.”

Marvell outlined a strategy in 2021 centered on custom and cloud-optimized silicon — chips specifically designed for use in data centers. It has been one of the biggest beneficiaries of the AI infrastructure boom since then and projects it will generate $12 billion in custom chip revenue in fiscal 2029, up from a prior target of $10 billion.

The company’s custom chip business has become a major growth engine, with technology companies developing in-house AI processors to reduce reliance on Nvidia chips. Marvell’s stock has more than tripled in value so far this year.

Marvell disclosed a deal with Alphabet’s Google in August that could generate up to $120 billion in sales through fiscal 2033, if performance milestones are achieved. 

That same month, it raised its full-year revenue outlook to about $18 billion from $16.5 billion. 

On Tuesday, Marvell forecast fiscal 2031 revenue of $70 billion to $90 billion. At $80 billion, the midpoint of that range exceeds Wall Street estimates of $46.85 billion, according to four analysts polled by Visible Alpha.

Analysts were expecting revenue of $18.2 billion for 2028, according to data compiled by LSEG.  

(Reporting by Prathik Jayaprakash and Anhata Rooprai in Bengaluru; Additional reporting by Max A. Cherney in San Francisco; Editing by Joyjeet Das and Rod Nickel)