By Dhirendra Tripathi
Investing.com – Marvell Technology stock (NASDAQ:MRVL) surged 22% Friday as the company gave a robust forecast for the current quarter, citing strong potential in 5G and data center businesses.
Marvell designs and makes chips that go into data centers and vehicles, a booming market that has been constrained by supplies. It also gives designs to companies like Taiwan Semiconductor (NYSE:TSM) for making chips.
"For the fourth quarter, we are expecting sequential revenue growth of 9 percent at the midpoint of guidance, led by 5G, which is projected to increase by 30% sequentially and data center which is forecasted to continue to grow in the double digits on a percentage basis," Matt Murphy, Marvell's president and CEO said in a statement.
Marvell expects second-quarter net revenue to be $1.32 billion with a plus-or-minus 3% variation on a year-on-year basis. Gross margin, on an adjusted basis, are expected to stay around 65% levels.
This comes after the company’s third-quarter revenue rose 61% to $1.21 billion, exceeding the top end of its previous estimate as well as analysts’ expectations.
All its business segments, led by data centers, grew. Data centers, Marvell’s largest contributor at 41% of its total revenue, grew 15% from the prior quarter and 109% year-over-year.
Adjusted profit per share rose 72%, to 43 cents, and was ahead of estimates.