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Marvell Technology, Inc. MRVL ended fiscal 2025 on a strong note by reporting stronger-than-expected fourth-quarter results. The chip maker reported fourth-quarter non-GAAP earnings of 60 cents per share, decisively exceeding the Zacks Consensus Estimate by 1.7%.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Quarterly earnings also came ahead of the midpoint of the company’s guidance of 59 cents (+/- 5 cents). Furthermore, the bottom line increased 30% year over year and 40% sequentially, driven by higher revenues and effective cost management.

Marvell’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 4.2%.

Marvell Technology, Inc. Price, Consensus and EPS Surprise

Marvell Technology, Inc. price-consensus-eps-surprise-chart | Marvell Technology, Inc. Quote

Marvell’s fourth-quarter revenues of $1.82 billion beat the Zacks Consensus Estimate by 0.7%. The top line was also above the midpoint of management’s guidance of $1.8 billion (+/- 5%). Fourth-quarter revenues grew 27% year over year and 20% sequentially, mainly driven by strong growth in the data center, partially offset by inventory corrections in other end markets.

Despite a better-than-expected fourth-quarter performance, shares of Marvell plunged 14.9% during Wednesday’s extended trading session as the sales outlook for the first quarter of fiscal 2026 failed to impress investors. The top-line projection for the first quarter is roughly in line with the Zacks Consensus Estimate.

Marvell’s Q4 End Market Details

Marvell’s top-line growth was supported by impressive performances across its segments, which rose sequentially, while the data center segment registered phenomenal growth both year over year and quarterly.

Data center revenues of $1.37 billion increased 78% year over year and 24% sequentially. The solid momentum in electro-optics products, custom AI silicon and next-gen switch divisions primarily drove the robust year-over-year and sequential increase. The segment accounted for 75% of the quarter’s total revenues, demonstrating that it is currently MRVL’s largest end market. Our estimate for Data Center’s fiscal fourth-quarter revenues was pegged at $1.36 billion.

Revenues from enterprise networking dropped 35% year over year to $171 million and accounted for 9% of the total revenues. The year-over-year decline was primarily due to the weak demand environment and ongoing inventory correction in this end market. However, a sequential increase of 14% depicts continued recovery in the segment. Our estimate for enterprise networking’s fiscal fourth-quarter revenues was pegged at $176.3 million.

Carrier infrastructure revenues, which accounted for 6% of the total revenues, plunged 38% year over year to $106 million due to a soft demand environment and ongoing inventory correction. Our estimate for the division’s fiscal fourth-quarter revenues was pegged at $98.9 million. Sequentially, the segment increased 25%, reflecting a continued recovery. Networking and carrier infrastructure collectively grew 18% on a quarter-on-quarter basis.

Automotive/Industrial revenues increased 4% year over year and 3% sequentially to $86 million, mainly driven by continued recovery in the automotive division partially offset by a decline in industrial due to lumpy order patterns. Revenues from this segment constituted 5% of the total revenues. Our estimate for the Automotive/Industrial’s fiscal fourth-quarter revenues was pegged at $84.9 million.

Consumer revenues, representing 5% of the total revenues, decreased 38% year over year and 8% sequentially to $85.7 million. Our estimate for Consumer’s fiscal fourth-quarter revenues was pegged at $82 million.

Marvell's Q4 Operating Details

Marvell’s non-GAAP gross profit of $1.09 billion reflected an increase of 19.9% on a year-over-year basis. However, the non-GAAP gross margin of 63.9% contracted 380 basis points (bps) on a year-over-year basis and 40 bps sequentially.

Non-GAAP operating expenses totaled $479.4 million compared with $428.5 million in the year-ago quarter and $466.9 million in the previous quarter.

Marvell’s non-GAAP operating margin of 33.7% contracted 10 bps year over year. However, it expanded 400 bps sequentially.

Marvell’s Balance Sheet & Cash Flow

As of Feb. 1, 2025, MRVL’s cash and cash equivalents were $948.3 million compared with $868.1 million in the previous quarter. The company’s long-term debt totaled $3.93 billion, slightly lower than the previous quarter’s $3.97 billion.

Cash flow from operations for the fourth quarter was $514 million. In full-fiscal 2025, the company generated an operating cash flow of $1.68 billion.

During the fourth quarter, Marvell returned $251.9 million to its shareholders through repurchasing stocks worth $200 million and paying $51.9 million in dividends. The company bought back shares worth $725 million and paid $207.5 million in dividends.

Marvell Initiates Guidance for Q1 2026

For the first quarter of fiscal 2026, Marvell expects revenues to be $1.875 billion (+/- 5%). The Zacks Consensus Estimate for revenues is pegged at $1.87 billion, with a year-over-year improvement of 60.9%. The non-GAAP gross margin is projected to be 60%, while non-GAAP operating expenses are estimated to be $490 million.

The company projects non-GAAP earnings per share for the fiscal first quarter to be 61 cents per share (+/- 5 cents per share), while the consensus mark for the same is currently pegged at 59 cents. The figure remains unchanged over the past 60 days, with a year-over-year improvement of 145.8%.

MRVL’s Zacks Rank & Other Stocks to Consider

Marvell currently carries a Zacks Rank #2 (Buy).

Atlassian TEAM, Radware RDWR and Fortinet FTNT are some other stocks that investors can consider in the broader Zacks Computer and Technology sector. TEAM, RDWR and FTNT carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Atlassian shares have soared 39.6% in the past year. The Zacks Consensus Estimate for TEAM’s fiscal 2025 earnings is pegged at $3.44 per share, indicating a 17.4% year-over-year increase.

Radware shares have gained 23.9% in the past year. The Zacks Consensus Estimate for RDWR’s 2025 bottom line is pinned at earnings of 95 cents per share, indicating a year-over-year increase of 9.2%.

Fortinet shares have surged 49.7% in the past year. The Zacks Consensus Estimate for FTNT’s full-year 2025 earnings is pegged at $2.45 per share, suggesting a year-over-year increase of 3.4%.

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

Marvell Technology, Inc. MRVL is set to report its fourth-quarter fiscal 2025 results on March 5, and all eyes are on the company’s booming artificial intelligence (AI)-driven data center business.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Over the past year, Marvell has significantly ramped up its custom AI silicon and electro-optics offerings, positioning itself as a key player in the AI infrastructure ecosystem. With data center revenues now accounting for the majority of its total sales, the upcoming earnings report is expected to highlight continued growth in this high-demand sector.

Click here to know how Marvell’s overall fiscal fourth-quarter results are likely to be.

Marvell Technology, Inc. Price and EPS Surprise

Marvell Technology, Inc. price-eps-surprise | Marvell Technology, Inc. Quote

Data Center Momentum to Drive Marvell’s Growth

Marvell’s data center segment has been the company’s strongest performer, fueled by the increasing adoption of AI workloads across hyperscale and enterprise markets. In the third quarter of fiscal 2025, the data center business reported record revenues of $1.1 billion, marking a 98% year-over-year increase and 25% sequential growth. This robust expansion was driven by surging demand for custom AI silicon, high-performance networking chips, and electro-optics solutions.

For the fourth quarter, Marvell expects its data center revenues to grow by another 20-25% sequentially, supported by strong customer orders and supply chain readiness. The company’s close collaboration with cloud giants such as Amazon Web Services (“AWS”) — through a recently expanded multi-year agreement — reinforces its leadership in providing AI-optimized silicon solutions. Our model estimates suggest that fourth-quarter data center revenues will reach $1.36 billion, implying a robust 23.5% sequential growth.

Marvell’s Custom AI Silicon: A Key Growth Catalyst

Marvell has gained significant traction in the AI semiconductor space through its custom AI silicon programs. The company has successfully ramped up its 100-billion-transistor AI accelerators, delivering first-pass silicon success to customers. These highly complex custom chips have allowed Marvell to secure deeper partnerships with hyperscale customers looking to optimize AI workloads with tailor-made solutions.

CEO Matt Murphy emphasized in the third quarter earnings call that demand for custom AI silicon remains strong, with the pipeline expanding across multiple customers. Marvell’s ability to design and manufacture high-performance, power-efficient AI processors gives it a competitive edge in the rapidly growing AI data center market.

During the last quarter earnings call, management revealed that it is set to significantly exceed the full-fiscal 2025 AI revenue target of $1.5 billion. The growing demand for custom AI silicon is anticipated to have driven the data center revenues in the fourth quarter.

Marvell’s Electro-Optics & Networking to Aid Revenue Growth

Apart from custom silicon, Marvell’s electro-optics and high-speed networking segments are also set to contribute significantly to the fourth-quarter revenues. The company’s 800-gig PAM and 400ZR interconnect solutions have seen strong order momentum, helping hyperscalers manage the exponential growth in AI-generated data traffic.

Additionally, Marvell has begun shipments of its industry-leading 1.6T PAM DSP technology, which enhances bandwidth efficiency and energy savings for next-generation data center interconnects. In the last reported quarter, electro-optics revenues grew by double digits sequentially, and the segment is expected to have posted further gains in the fourth quarter as AI adoption accelerates.

MRVL’s Zacks Rank & Other Stocks to Consider

Marvell currently carries a Zacks Rank #2 (Buy).

Atlassian TEAM, Radware RDWR and Fortinet FTNT are some other stocks that investors can consider in the broader Zacks Computer and Technology sector. TEAM, ZS and FTNT carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Atlassian shares have soared 32.5% in the past year. The Zacks Consensus Estimate for TEAM’s fiscal 2025 earnings is pegged at $3.44 per share, indicating a 9.2% year-over-year increase.

Radware shares have gained 18.5% in the past year. The Zacks Consensus Estimate for RDWR’s 2025 bottom line is pinned at earnings of 95 cents per share, indicating a year-over-year decline of 20.1%.

Fortinet shares have surged 49.4% in the past year. The Zacks Consensus Estimate for FTNT’s full-year 2025 earnings is pegged at $2.43 per share, suggesting a year-over-year increase of 2.5%.

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

HP Inc. HPQ shares fell 3.9% during Thursday’s extended trading session after the personal computer (PC) maker reported lower-than-expected bottom-line results for first-quarter fiscal 2025 and issued a profit outlook for the second quarter that fell short of the Zacks Consensus Estimate.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

HP reported first-quarter non-GAAP earnings of 74 cents per share, missing the consensus mark by a penny. The bottom-line result declined 9% from the year-ago quarter’s earnings of 81 cents, mainly due to higher expenses, which more than offset the benefit of higher revenues.

In the trailing four quarters, HP’s earnings surpassed the Zacks Consensus Estimate once while missing the same on three occasions, the average negative surprise being 1.16%.

HP Inc. Price, Consensus and EPS Surprise

HP Inc. price-consensus-eps-surprise-chart | HP Inc. Quote

HPQ’s revenues increased 2.4% year over year to $13.5 billion and were in line with the Zacks Consensus Estimate. The year-over-year growth was primarily driven by higher Personal Systems (PS) sales, which more than offset the negative impact of lower revenues in the Printing business.

HPQ’s Q1 Top-Line Details

PS revenues (68.1% of net revenues) came in at $9.2 billion, which improved 5% from the year-ago quarter’s figure (5% up at constant currency or cc). The upside in this division was mainly driven by revenue growth from commercial unit performance and market share gains in Personal Systems.

HP’s total PC units sold were down 1% on a year-over-year basis, mainly due to an 11% decrease in Consumer PS shipments, partially offset by an increase of 6% in Commercial PS shipments. Revenues from the Commercial PS segment increased 10% year over year, while the Consumer PS segment sales declined 7%.

The Printing business’ revenues (31.9% of net revenues) decreased 2% year over year (down 1% at cc) to $4.45 billion. Weakness in the Commercial Printing business and Supplies led to an overall decline in the segment revenues.

Consumer Printing net revenues improved 5%, while Commercial Printing net revenues declined 7%. Supplies net revenues were down 1% (flat in cc) year over year. Total hardware units increased 5%, with Consumer Printing units up 7% and Commercial Printing units flat.

The company witnessed growth across all regions. On a constant currency basis, the Americas rose 3%, the EMEA region witnessed growth of 2% and the Asia Pacific and Japan revenues increased 5% year over year.

Operating Results of HP

Segment-wise, PS’ non-GAAP operating margin contracted 60 basis points (bps) to 5.5%. The Printing division’s non-GAAP operating margin contracted 90 bps to 19%.

HP’s overall non-GAAP operating margin from continuing operations of 9.6% contracted 80 bps year over year. The lower margin was mainly due to the negative impacts of higher commodity costs and increased investments in strategic initiatives.

HPQ’s Balance Sheet and Cash Flow

HP ended the fiscal first quarter with cash, cash equivalents and restricted cash of $2.89 billion, down from $3.25 billion at the end of the previous quarter.

During the quarter, HPQ generated $374 million worth of cash from operational activities and $70 million in free cash flow. It returned $373 million to its shareholders in the form of share repurchases and cash dividends.

HP’s Q2 and FY25 Guidance Update

For the second quarter of fiscal 2025, the company estimates non-GAAP EPS between 75 cents and 85 cents (midpoint 80 cents). The Zacks Consensus Estimate is pegged at 85 cents.

The company raised its bottom-line guidance for fiscal 2025. For the fiscal, it now expects non-GAAP EPS between $3.45 and $3.75 (midpoint $3.60), up from the previous range of $3.06-$3.36. The Zacks Consensus Estimate is pegged at $3.57 per share.

HPQ still expects its free cash flow in the range of $3.2-$3.6 billion for fiscal 2025.

HP’s Zacks Rank & Other Stocks to Consider

HPQ currently carries a Zacks Rank #2 (Buy).

Atlassian TEAM, CyberArk CYBR and Fortinet FTNT are some other stocks that investors can consider in the broader Zacks Computer and Technology sector. TEAM, ZS and FTNT carry a Zacks Rank #2 each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Atlassian shares have soared 35.4% in the past year. The Zacks Consensus Estimate for TEAM’s fiscal 2025 earnings is pegged at $3.44 per share, indicating a 17.4% year-over-year increase.

CyberArk shares have gained 35.5% in the past year. The Zacks Consensus Estimate for CYBR’s 2025 bottom line is pinned at earnings of $3.64 per share, indicating a year-over-year decline of 20.1%.

Fortinet shares have gained 54.1% in the past year. The Zacks Consensus Estimate for FTNT’s full-year 2025 earnings is pegged at $2.43 per share, suggesting a year-over-year increase of 2.5%.

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research