Marvell (MRVL) Q4 Earnings Meet Estimates, Revenues Beat

Marvell (NASDAQ:MRVL) Technology Group MRVL delivered fourth-quarter fiscal 2021 non-GAAP earnings of 29 cents, in line with the Zacks Consensus Estimate. Moreover, the reported figure surged 70.6% from the year-ago quarter’s figure.

Marvell’s revenues of $798 million surpassed the consensus mark of $786 million. In addition, the revenue figure increased 11.2% year over year. 5G and Cloud product ramp-ups were a major driving factor.

Quarter Details

In the end markets, storage revenues (41% of total revenues) grew 10% year over year to $326.4 million.

The networking business (55%) revenues fell 1% year on year to $438.6 million.

Other product revenues (4%) during the fiscal fourth quarter grew 13% on a year-over-year basis to $32.8 million.

Notably, total core business constituted 96% of total revenues and increased 6% year over year to $765 million.

Marvell’s non-GAAP gross margin expanded 160 basis points (bps) to 63.9%. Non-GAAP operating expenses declined 7.5% year over year to $283.2 million. Non-GAAP operating margin expanded 880 bps year on year to 28.4%.

Balance Sheet and Cash Flow

Marvell exited the reported quarter with cash and cash equivalents of $748 million compared with the previous quarter’s $832 million. The company’s long-term debt totaled $993.2 million.

The firm generated cash from operating activities of $158.3 million during the fiscal fourth quarter and $817.3 million in fiscal 2021. Marvell returned $40.5 million and $160.6 million to shareholders through dividend payments during the quarter and full year, respectively.

Full-Year Highlights

For fiscal 2021, total revenues came in at $3 billion, up 10% year over year. Non-GAAP earnings of 92 cents per share were up 39.4%.

Guidance

Marvell's guidance for the first quarter of fiscal 2022 takes into account the U.S. government's export restriction on certain Chinese customers. The company has temporarily widened the guided range for revenues due to the uncertainties associated with the coronavirus crisis.

The company projects first-quarter fiscal revenues of $800 million (up or down up to 5%). The Zacks Consensus Estimate for revenues is pegged at $784.1 million, suggesting growth of 13.04% from the year-ago quarter.

Non-GAAP earnings per share are expected between 23 cents and 31 cents. The consensus mark of 27 cents indicates a 50% year-over-year surge.

Zacks Rank & Stocks to Consider

Marvell currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the broader technology sector are Skyworks Solutions (NASDAQ:SWKS) SWKS, Zoom Video Communications (NASDAQ:ZM) ZM and Shopify (NYSE:SHOP) Inc. SHOP, each sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Skyworks Solutions, Zoom and Shopify is currently pegged at 18.98%, 25% and 32.5%, respectively.

The Hottest Tech Mega-Trend of All

Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>