Wednesday, February 8, 2023
HomeMarketMarvell Stock Sinks as Earnings Fall Short. Customers Are Pulling Back.

Marvell Stock Sinks as Earnings Fall Short. Customers Are Pulling Back.

As of Thursday’s close, Marvell stock had lost almost half of its value so far this year.

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Marvell Technology
shares were sinking in late trading Thursday after the data- center semiconductor firm’s earnings and outlook disappointed Wall Street. The company said makers of storage equipment are reducing their stockpiles of chips, hurting its near-term results.

Marvell
(ticker: MRVL) reported October quarter non-GAAP net income of $491.5 million, or 57 cents a share. Analysts polled by FactSet had forecast adjusted earnings of 59 cents a share. Revenue of $1.54 billion was a touch below estimates of $1.55 billion.

The firm expects January quarter non-GAAP earnings of 46 cents, plus or minus five cents, which was below the consensus call for 62 cents a share.

“Inventory reductions, in particular at our storage customers, are impacting our near-term results and guidance, and we are working closely with them to manage their change in demand in an orderly fashion to clear the path to a resumption of growth,” CEO Matt Murphy said in the earnings release.

Marvell stock was down 7.2% to $42.13 in extended trading Thursday. Marvell shares have struggled this year amid a broader slump for semiconductor stocks. The stock was down 48% so far this year at Thursday’s close.

“Our design win pipeline remains strong, our new cloud-optimized products are starting to ramp, and we are well positioned to navigate the current environment successfully and remain confident in our long-term growth drivers,” Murphy wrote.

The company’s earnings call was set to start at 4:45 Eastern time.

Write to Connor Smith at connor.smith@barrons.com

Credit: marketwatch.com

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