:Marvell Technology’s market value surged to a record high on Wednesday, overtaking struggling semiconductor firm Intel’s valuation, following an upbeat forecast by the networking chipmaker on the back of AI-linked demand.
The company’s shares jumped nearly 23 per cent giving it a market capitalization of $102 billion.
Intel had a market value of $94 billion after its stock fell 2.5 per cent, adding to recent losses after CEO Pat Gelsinger’s ouster was announced on Monday. The company’s market capitalization dipped below the $100 billion mark this year for the first time in three decades.
Marvell, which produces custom AI chips for major cloud providers that help GenAI speedily process large amounts of data, forecast fourth-quarter revenue above estimates on Tuesday.
“The company is capitalizing on a massive artificial intelligence chip opportunity with a burgeoning custom accelerator portfolio and a dominant optical chip position,” Morningstar analysts said.
Marvell is on track to exceed its earlier target of $1.5 billion in AI revenue in the current fiscal year, CEO Matt Murphy said on Tuesday.
“We are seeing strong custom AI demand continue into the fourth quarter and have secured supply chain capacity,” Murphy added.
Reuters reported on Tuesday that Murphy is being considered a potential candidate for the position of CEO at Intel. However, Murphy said during a post-earnings call that he remains “100 per cent focused on Marvell.”
Marvell’s shares have climbed nearly 60 per cent this year.
Efforts by Microsoft, Meta and Alphabet to reduce reliance on AI chip leader Nvidia’s supply-constrained processors have benefited companies such as Marvell and its larger competitor Broadcom.
“The custom processing business is largely expected to be a potential Nvidia disruptor,” Carson Group analyst Blake Anderson said.
Marvell’s data center segment, which includes custom chips, saw 98 per cent growth to a record $1.10 billion, accounting for more than 70 per cent of total revenue in the third quarter, compared with about 40 per cent a year earlier.
Broadcom’s shares rose about 1 per cent, while Nvidia rose close to 3 per cent. Qualcomm and AMD’s stock edged higher.
