AI Stock Ready to Soar After May 29

Marvell Technology Poised for Growth in AI Chip Market

Marvell Technology is set to release its fiscal 2026 first-quarter results on May 29, positioning itself as a key player in the AI chip market. The company's focus on custom AI processors and strategic partnerships with major tech companies like Nvidia suggests a promising outlook for its stock performance.

The upcoming report is expected to highlight Marvell's revenue growth, with projections of $1.88 billion in revenue and non-GAAP earnings of $0.61 per share. This marks a significant improvement over the previous year’s adjusted earnings of $0.24 per share on revenue of $1.16 billion. The growth is largely driven by the increasing demand for Marvell's custom AI processors and networking chips, which are used by major cloud providers such as Amazon, Google, and Microsoft.

Strong Demand for AI Processors

Marvell's custom AI processors have become essential for powering AI data centers. The company has noted stronger-than-expected demand from its AI customers, including major cloud providers. These partnerships are expected to strengthen as cloud companies collaborate with Marvell on deploying next-generation custom AI silicon.

Marvell anticipates its custom AI chip revenue to continue growing in fiscal 2026 and beyond. The company exceeded its $1.5 billion target for AI revenue in the previous fiscal year and expects to significantly surpass its $2.5 billion target in fiscal 2026. This growth is attributed to Marvell's focus on product development and strategic partnerships, aiming to capture more of the custom AI chip market from competitors like Broadcom.

Innovations in Chip Architecture

In March, Marvell unveiled a 2-nanometer (nm) custom chip architecture, an advancement over the previous 3nm platform. This move to a smaller process node allows Marvell to pack more transistors into a smaller area, resulting in more powerful and power-efficient chips. The company is also partnering with Nvidia to leverage the NVLink Fusion platform, enabling third-party chip manufacturers like Marvell to build custom AI processors compatible with Nvidia's GPUs.

This partnership is expected to enhance Marvell's presence in the custom AI silicon market, which the company projects to grow at a compound annual rate of 45% through 2028. The collaboration with Nvidia could further solidify Marvell's position as a leader in AI chip technology.

Stock Performance and Future Outlook

Marvell's stock has experienced a 45% decline in 2025, but the upcoming quarterly report could catalyze a rebound. The stock is currently trading at 22 times earnings, and with earnings predicted to jump by 77% in the current fiscal year to $2.79 per share, Marvell presents a compelling investment opportunity. If the company meets its targets and trades in line with the Nasdaq-100 index's earnings multiple of 31, its stock price could increase by 45% from current levels.

Analysts have set a 12-month price target of $97 for Marvell, indicating strong potential for future gains. The combination of innovative chip architecture, strategic partnerships, and growing demand for AI processors positions Marvell Technology as a key player in the rapidly expanding AI chip market.