What Happened?
Shares of networking chips designer Marvell Technology (NASDAQ: MRVL) jumped 29% in the afternoon session after Nvidia CEO Jensen Huang called the company "the next trillion-dollar company" during his keynote at Computex Week in Taipei.
The endorsement was not rhetorical. Nvidia recently committed $2 billion in investment into Marvell, and Huang's explanation was pointed: AI data centers are built on disaggregated computing (thousands of chips spread across a facility) and that architecture only functions with the right connectivity infrastructure. "That's the reason why Marvell is so essential," he said. The endorsement lands on top of already exceptional fundamentals.
On May 27, Marvell reported record Q1 FY27 revenue of $2.418 billion, up 28% year-over-year, with management describing AI-related bookings as "exceptional." The company raised its full-year FY27 revenue target to approximately $11.5 billion and said custom silicon, its bespoke AI chip business for hyperscalers, was on track to grow more than 20% in FY27 and to more than double in FY28. Q2 guidance of $2.7 billion, representing 35% year-over-year growth, came in well ahead of estimates.
Heading into the session, Marvell's market cap was just under $192 billion; Huang's trillion-dollar call implied more than a five-fold increase from that level.
Is now the time to buy Marvell Technology? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Marvell Technology’s shares are extremely volatile and have had 38 moves greater than 5% over the last year. But moves this big are rare even for Marvell Technology and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 5.7% on the news that Micron's blowout day signaled that AI-driven chip demand is structurally undersupplied which is bullish news for the equipment makers and foundries that build the capacity.
Semiconductor manufacturing equipment (Applied Materials, Lam Research, KLA, ASML) and foundries (TSMC, GlobalFoundries) benefit when chip companies announce capacity expansions. Every dollar of additional Micron capex flows to the equipment makers that supply the tools, and every new fab Micron builds is a multi-year revenue stream for the foundries that share processes.
UBS estimated Micron will spend $50B+ on capacity over the next 5 years. At industry-average tool intensity, that's billions of equipment orders.
Marvell Technology is up 219% since the beginning of the year, and at $284.94 per share, it has set a new 52-week high. Investors who bought $1,000 worth of Marvell Technology’s shares 5 years ago would now be looking at an investment worth $5,998.
WHILE YOU’RE HERE: The Next Palantir? One satellite company captures images of every point on Earth. Every single day. The Pentagon wants it. Hedge funds are using it to beat earnings. You’ve probably never heard of it.
This is what the early days of Palantir looked like before it became a $437 billion giant. Same playbook. Different technology. If you missed Palantir, you need to see this. Claim The Stock Ticker for Free HERE.
