Marvell Technology Group anticipates a dip in revenue from segments covering wireless carrier infrastructure and enterprise in the upcoming quarter. This decline is attributed to a challenging macroeconomic environment and extended customer inventory adjustments. CEO Matthew Murphy cited a generally weak business landscape among enterprise and carrier companies.
On the bright side, Marvell's data center division, especially its AI chip business and networking equipment, exceeded revenue expectations in Q3. However, projecting its future performance, especially concerning AI, poses challenges due to unpredictable growth.
Despite the decline in some segments, Marvell surpassed third-quarter revenue and profit estimates, fueled by the swift adoption of artificial intelligence, boosting chip demand. They reported a net revenue of $1.42 billion, surpassing analysts' $1.40 billion estimate. Excluding items, they posted a profit of 41 cents per share, slightly exceeding the anticipated 40 cents per share.
However, their fourth-quarter forecast fell below Wall Street estimates, with expected revenue of $1.42 billion, a potential 5% variance, compared to estimates of $1.46 billion. Adjusted profit is projected at 46 cents per share, with a 5-cent margin, while analysts anticipated 49 cents per share.