Marvell Technology Exceeds Expectations with Strong Q4 FY2026 Results
Marvell Technology reported a solid Q4 FY2026, with revenue and EPS both beating street estimates, driven by strong demand in the data center and switching markets. The company's outlook for FY2027 is even more ambitious, with revenue guidance pointing to a significant year-over-year growth.
Marvell Technology reported Q4 FY2026 revenue of $2.2187 billion, slightly above the street estimate of $2.2067 billion, representing a 0.5% positive surprise. The company's EPS of $0.80 also beat the street estimate of $0.79, with a 1.0% positive surprise. This performance is a continuation of Marvell's strong financial trajectory, with revenue growing 22% year-over-year and 7% sequentially.
The company's data center revenue was a standout, reaching $1.65 billion in the quarter, up 9% sequentially and 21% year-over-year. This segment's performance is a testament to Marvell's strategic focus on high-growth areas such as cloud computing and AI.
Despite the revenue growth, Marvell's gross margin for the quarter was 48.4%, a slight decline from the previous quarter's 51.6%. CFO Willem Meintjes noted, "Non-GAAP operating expenses came in at $517 million, in line with guidance." The company expects non-GAAP operating expenses to be approximately $575 million in the first quarter of FY2027, reflecting continued investment in growth initiatives.
Marvell's guidance for the first quarter of FY2027 is optimistic, with total company revenue forecasted to grow 8% sequentially to $2.4 billion at the midpoint.
The company's full-year outlook is even more ambitious. Marvell expects overall revenue in FY2027 to grow more than 30% year-over-year, approaching $11 billion.
Marvell's long-term projections are equally impressive. The company expects to reach $15 billion in revenue by FY2028, driven by continued growth in data center and switching markets. Murphy noted, "So in aggregate, we expect Marvell's overall revenue in fiscal 2028 to grow close to 40% year-over-year, reaching approximately $15 billion, roughly $2 billion higher than the outlook we provided in our December earnings call, and driving our non-GAAP EPS to well over $5."
Marvell's success in the data center and switching markets is a key driver of its strong performance. The company's data center revenue surpassed $6 billion in FY2026, growing 46% year-over-year.
In the data center switching market, Marvell delivered strong growth, with revenue exceeding $300 million in FY2026. The company expects this segment to surpass $600 million in FY2027, driven by the ramp of next-generation 51.2T products. Murphy stated, "Given sustained demand for our current 12.8T products and a strong ramp of next-generation 51.2T products, we now expect data center switch revenue in fiscal 2027 to surpass $600 million, up from the $500 million we had indicated last quarter."
Marvell's investments in AI and connectivity are also paying off. The company expects Celestial AI and XConn to contribute approximately $250 million in aggregate revenue in FY2028.
Marvell's strong performance is also supported by its strategic relationships with key customers and suppliers. The company supplies PAM4 optical DSP chips to Zhongji Innolight (300308.SZ) and Eoptolink (300502.SZ), and collaborates with Microsoft [MSFT] on silicon design for Maia ASICs. TSMC [TSM] is a critical supplier for Marvell, providing 3nm and 5nm fabrication for optical DSP and custom AI ASICs.
The demand from Marvell's key customers, particularly in the data center and switching markets, remains strong. Microsoft's continued investment in cloud infrastructure and AI is a significant driver of Marvell's growth. Murphy noted, "In just a few years, we have scaled from zero revenue to $1.5 billion in fiscal 2026."
Compared to its peers in the fabless semiconductor industry, Marvell's performance stands out. While companies like NVIDIA [NVDA] and Google [GOOGL] have also reported strong revenue growth, Marvell's 22% year-over-year revenue growth and 48.4% gross margin are competitive. The table below provides a comparison of key financial metrics:
| Ticker | Revenue | Gross Margin | Revenue YoY |
|---|---|---|---|
| NVDA | $81.61 billion | 74.9% | +85.2% |
| GOOGL | $109.90 billion | 62.4% | +21.8% |
| MSFT | $82.89 billion | 67.6% | +18.3% |
| MRVL | $2.2187 billion | 48.4% | +22.1% |
Marvell's earnings call for Q4 FY2026 was characterized by a positive and confident tone, with the company's management team providing clear guidance and optimistic outlooks. The call's sentiment score of 0.45, guidance tone of 0.61, and prepared sentiment of 0.82 reflect this positive delivery.
Full call-over-call delivery metrics are in the tone history.
CEO Matthew Murphy and CFO Willem Meintjes provided detailed insights into the company's performance and future plans. Murphy emphasized the company's strong growth in the data center and switching markets, while Meintjes discussed the financial metrics and capital returns. The call also addressed investor questions with clarity and transparency, as reflected in the low qa_evasiveness score of -13.4.
Investor sentiment was generally positive, with analysts like James Schneider noting the company's increased visibility and ambitious growth targets. Schneider commented, "It's great to hear the increased visibility you have business in the next year, but If I think about the guidance for $15 billion of revenue next year, and $5 of earnings, roughly speaking, that's about 15% to where I see the peak consensus being for next year's revenue, but only about half of that on the earnings side."
Marvell Technology's Q4 FY2026 results and guidance for FY2027 demonstrate the company's strong financial performance and ambitious growth plans. The company's focus on high-growth areas such as data centers and switching, combined with its strategic relationships with key customers and suppliers, positions Marvell well for continued success. The positive tone and clear guidance provided during the earnings call further reinforce the company's commitment to driving shareholder value.