Small AI Chip Maker Marvell is Now More Valuable Than Intel (msn.com) 38
This year Marvell's stock rose 95%, giving it a $100 billion market capitalization, according to the Wall Street Journal.
"The latest gains have even put Marvell's market cap ahead of much-beleaguered Intel, which still generates 10 times as much annual revenue." Marvell's recent trajectory suggests that the revenue gap will continue to narrow. The explosive growth of its data center business has finally reached a point where it can more fully offset weakness in the company's more legacy segments, which sell chips used in goods such as telecommunications gear, cable TV boxes and autos. Data center sales nearly doubled year over year to $1.1 billion in the just-ended quarter, and Marvell's projection for the current period indicates the company will end its fiscal year in January with the data center unit encompassing about 72% of its total revenue, up from 40% in the previous year.
The next year is looking bright as well. Marvell's latest deal with Amazon is a five-year "multigenerational" agreement that has Marvell helping Amazon design its own artificial intelligence chips. Amazon, which runs the world's largest cloud computing service, has been expanding its internal chip efforts significantly, in part to reduce its reliance on Nvidia for crucial AI components. Amazon announced the next generation of its largest AI chip, called Trainium, at its annual developers conference this week. Analysts believe Trainium will play a role in Marvell's AI custom revenue more than doubling in the next fiscal year ending January of 2026.
That is expected to help propel Marvell's annual revenue to more than $8 billion in fiscal 2026, up 40% from what is expected for this year, according to consensus estimates from Visible Alpha. In addition, 20% growth is expected for the following year, when Marvell expects to be in production of custom AI chips for another unnamed big tech customer that analysts believe to be Microsoft. Analyst Mark Lipacis of Evercore ISI projects that the industry for custom AI chips will reach $30 billion to $50 billion in sales by 2030. In a note to clients last week, he said Marvell "has the potential to capture one-third of that market."
Marvell's CEO "has been among the few names floated as potential replacements for the recently ousted Pat Gelsinger at Intel's corner office," the article points out — which meant he had to reassure investors on an earnings call that he was staying at Marvell.
"The company is outstanding. The technology is best-in-class. I can't think of a better place to work than Marvell."
"The latest gains have even put Marvell's market cap ahead of much-beleaguered Intel, which still generates 10 times as much annual revenue." Marvell's recent trajectory suggests that the revenue gap will continue to narrow. The explosive growth of its data center business has finally reached a point where it can more fully offset weakness in the company's more legacy segments, which sell chips used in goods such as telecommunications gear, cable TV boxes and autos. Data center sales nearly doubled year over year to $1.1 billion in the just-ended quarter, and Marvell's projection for the current period indicates the company will end its fiscal year in January with the data center unit encompassing about 72% of its total revenue, up from 40% in the previous year.
The next year is looking bright as well. Marvell's latest deal with Amazon is a five-year "multigenerational" agreement that has Marvell helping Amazon design its own artificial intelligence chips. Amazon, which runs the world's largest cloud computing service, has been expanding its internal chip efforts significantly, in part to reduce its reliance on Nvidia for crucial AI components. Amazon announced the next generation of its largest AI chip, called Trainium, at its annual developers conference this week. Analysts believe Trainium will play a role in Marvell's AI custom revenue more than doubling in the next fiscal year ending January of 2026.
That is expected to help propel Marvell's annual revenue to more than $8 billion in fiscal 2026, up 40% from what is expected for this year, according to consensus estimates from Visible Alpha. In addition, 20% growth is expected for the following year, when Marvell expects to be in production of custom AI chips for another unnamed big tech customer that analysts believe to be Microsoft. Analyst Mark Lipacis of Evercore ISI projects that the industry for custom AI chips will reach $30 billion to $50 billion in sales by 2030. In a note to clients last week, he said Marvell "has the potential to capture one-third of that market."
Marvell's CEO "has been among the few names floated as potential replacements for the recently ousted Pat Gelsinger at Intel's corner office," the article points out — which meant he had to reassure investors on an earnings call that he was staying at Marvell.
"The company is outstanding. The technology is best-in-class. I can't think of a better place to work than Marvell."
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AI is the new .com (Score:4, Interesting)
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We need to stop saying something is the most valuable based upon stock price. Net revenue seems better for me, it more accurately says if they're selling products rather than just being a popular investment.
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Net revenue shows how much money something makes, not how valuable something is. If you offer to buy my pen for $10 and I offer to sell you a pen for $10 it's value is $10. Same with a company, if you buy shares for $X and someone sells you shares for $X and there are Y shares in circulation then X*Y = the total value of the company.
That value may not be related to underlying financial performance, but if people agree on a price it's hard to justify that isn't its value.
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But people decide on stock values not based upon a company's viability, profits, or performance. They decide on stock values the same way they decide which slot machine to pull the lever on. Thus you get the unicorn startups, who have not made a single dollar in revenue but still valued in millions.
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Yes, but that doesn't change what value they see in that slot machine. If everyone is pulling that lever then you can't disagree that what the slot machine is gobbling up is the general value.
You could say it's not that valuable to you, but the market price deals with generalities. A company's value is set by a wider market, you don't need to personally agree with it, but the concept of value is broadly set and agreed based on what people do with it.
The problem here is people getting hung up on certain defi
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Define "tiny volume". Marvell is a nothing of a company, it experienced nothing of significance yesterday, and yet traded 17,600,000 shares.
We don't consider the value of something only during a fire sale. That's like saying your car is worth nothing because you're going to keep driving it until it is scrap metal. That's not how value works. When we look at the value of something we consider what it is worth right now.
Trading price is supply and demand a lot more than the value of the underlying asset.
You're confused. You think somehow the concepts are independent and one or the other is re
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Re: AI is the new .com (Score:2)
By net revenue, Boeing may be one of the best companies.
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The trading price indicates the consensus value. Marvell is worth more than Intel because, the market prediction (right or wrong) is that Intel's future revenue will slowly decline while Marvell's will r
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Stock value is what is it trading for, which is often unrelated to company performance. Ie, Gamestop as an example. Pump and dump will have terrible revenue and profits but the value rises even if the company is moribund.
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My net revenue is one billion dollars a year. A friend and I have a ten dollar bill that we trade back and forth via a script that makes entries in a spreadsheet.
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Ok, maybe `net` was wrong, and can be gamed worse than stock values. But stock value is a terrible way to determine value of a company, because it it often very volatile and often unrelated to a company's operations.
Also, I had originally intended to say "profit", but most companies internally in staff meetings seem to use net revenue instead as a way to say "sales up are up, good job guys, now get back to work!"
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The stock price is what it costs you to buy a piece of the company. It's not "a terrible way to determine the value of a company," it is it. It absolutely can go up and down in a company whose value is uncertain or depends heavily on some sort of event. If a mom and pop corner store has a catastrophic fire do you think its current value is more accurately reflected by the value of their sales last year or by how much someone will pay for whatever's left?
Yes, companies talk a lot about revenue because it's a
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A lot of what we see being done with AI is relatively useless. But AI itself has value. I have implemented AI systems where I work, freeing up a number of admin employees who would otherwise have doing been work that is now handled by AI. And speeding up those processes. So in a real sense, AI has delivered efficiencies to my employer. But you're right, we're not deploying chatbots or many of the things that are commonly used to demonstrate AI. I fully expect the AI hype-cycle to continue until it's used on
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Not exactly - it's a growing company, it meant fewer new people need to be hired in the coming year, nobody was actually let go.
Marvell is still around? (Score:4, Insightful)
Have not heard of them in ages. But this "valuation" only shows two things:
1. AI is a massive bubble and the damage it will do when it collapses will be impressive and raises day by day
2. Intel has massively screwed itself
Stupidity all around. What a fail.
Re:Marvell is still around? (Score:5, Interesting)
Calling Marvell an "AI chip maker" is a bit weird.
Marvell's situation in datacenter is more about how Broadcom became harder to work with to make networking solutions after Avago bought them, and Marvell, with a few acquisitions under their belt, becoming the heir apparent to "I want a cost effective ethernet solution that's easy to work with". You want to go to market with a good enough ethernet switch, or some solution with an embedded ethernet switch? Well, Marvell's the choice now whereas it would have been almost certainly Broadcom a decade ago.
Though it is a bit weird to consider Intel as worth less than Marvell still. Intel has way more revenue and potential to hold on to that revenue than Marvell has potential to grow. If Intel tosses aside a lot of their disastrously expensive distractions, they would be pretty solid. Meanwhile, despite what Marvell has done, it's ultimately perceived as a "budget" choice, and so they have limits for margin. Further, it's relatively lower volume than what nVidia, AMD, and Intel are targetting and less valued.
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I used to get PCI bus error from some Marvell SATA controllers on linux.
AI is more fault tolerant.
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The AI stock bubble is just like the dot-com bubble of the early 2000's. It's going to be a bloodbath when it pops.
It is. And the later it pops, the worse the damage will be. As some very powerful assholes try to keep it going, doubtless in an attempt to get even even more immorally rich, it may still take a while.
Do they make chips? (Score:2)
Marvell design chips I don't think they make chips but I could be wrong.
One of the few things I found was this article from 2008 which mentions "completing the planned transition of several mobile products to its customary fabrication facilities from Intel manufacturing operations. Upon completion of this transition all of Marvell’s communication processors will be manufactured utilizing the Company’s standard fabrication partners."
https://www.marvell.com/compan... [marvell.com]
There are recent articles about
CEO speak (Score:4, Insightful)
I like how CEO's talk. Totally non-committal at all times. "I can't think of a better place to work than Marvell." --- you realize that's a weak statement, right? It still leaves him open to the possibility of ditching Marvell at any time. If he does leave Marvell to join Intel .. for example he can say he meant that his statement was valid for that time, or that he hadn't been shown all the potential Intel has.
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>>> I can't think of a better place to work
>> We'll pay you $83M to start.
> Oh, upon further reflection.
Learn something new every day.
Re:CEO speak (Score:5, Interesting)
Well as a former (retired in 2023) Marvell employee, I have to say that they were a great employer - I liked working there as an ordinary engineer.
I started with IBM in the days of the "good IBM" and watched it turn into the "bad IBM". Then IBM sold me along with a few thousand of my closest friends and a bunch of real estate to Global Foundries. Then after a few years Global Foundries dropped off of the leading edge technologies and sold me along with a few hundred close friends to Marvell, where I worked until I retired. Though I spent my career in the East, Marvell the company seemed to have more of the West Coast culture, which was in some ways closer to the "good IBM".
Marvell are pretty good (Score:3)
20 years ago (Score:3)
Intel was seeing no use for their ARM chip technology and know how, so they dumped it... by selling it to Marvell. Now Marvell is advancing in the datacenter with their ARM solutions, eating Intel's lunch.