Marvell Technology Group Ltd. (NASDAQ:MRVL) shares plunged as its guidance for the first quarter surpassed estimates but disappointed investors, who had expected stronger AI-driven growth.
The company guided Q1 revenue of $1.88 billion, in line with the $1.87 billion expected by analysts.
For the fourth quarter, revenue of $1.82 billion beat estimates of $1.8 billion while earnings per share of $0.60 were $0.01 ahead of the $0.59 expected.
Analysts at Bank of America described the report as “less sizzle but enough substance.”
They reiterated their ‘Buy’ rating on Marvell Technology, citing the company’s long-term AI opportunity.
“We continue to see Marvell as a top-three AI vendor, along with Nvidia and Broadcom, given Marvell's breadth of IP across compute, networking, optics, and storage,” they wrote.
“Along with the currently ramping AI training project, Marvell has confirmed it has won multi-gen, multi-product pipeline across advanced manufacturing nodes at AWS, leading to year-over-year growth for the customer in both fiscal year 2026 and fiscal year 2027.”
They see upcoming industry events and Analyst Day as positive catalysts.
The bank’s analysts lowered their price target to $120 from $150 citing the recent reduction in sector multiples.
Shares of Marvell had fallen 17.2% at about $75 late morning on Thursday.