Marvell Looks to Beat Q4 Earnings Estimates: Should You Buy the Stock?

Marvell Technology, Inc. MRVL is likely to beat expectations when it reports fourth-quarter fiscal 2025 results after market close on March 5.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Marvell projects total revenues for the fiscal fourth quarter of $1.8 billion (+/- 5%). The Zacks Consensus Estimate for revenues is pegged at $1.8 billion, which indicates an increase of 26.5% from the year-ago quarter’s reported figure.MRVL anticipates non-GAAP earnings to be 59 cents per share (+/- 5 cents) for the fourth quarter. The consensus mark for non-GAAP earnings has remained unchanged for the past 60 days at 59 cents, which calls for a 28.5% increase from the year-ago quarter.Image Source: Zacks Investment ResearchIn the trailing four quarters, Marvell’s earnings surpassed the Zacks Consensus Estimate thrice and matched once, with an average surprise of 3.8%.Marvell Technology, Inc. Stock Price and EPS Surprise Marvell Technology, Inc. price-eps-surprise | Marvell Technology, Inc. QuoteEarnings Whispers for MarvellOur proven model predicts an earnings beat for MRVL this earnings season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is the case here.Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate (61 cents per share) and the Zacks Consensus Estimate (59 cents per share), is +2.77%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.Zacks Rank: Marvell carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Factors Likely to Influence Marvell’s Q4 ResultsMarvell’s overall fourth-quarter revenues are likely to have benefited from improved performances across the majority of its end markets. The company’s data center division continues to be the primary engine of growth, benefiting from the rising demand for electro-optics products, custom artificial intelligence (AI) silicon and next-gen switches. Our model estimates suggest that fourth-quarter data center revenues will reach $1.36 billion, implying robust 23.5% sequential growth.The growing adoption of 800-gig PAM products and 400ZR data center interconnect (DCI) solutions is fueling top-line expansion. Additionally, advancements in Compute Express Link technology and increased AI-related investments position Marvell as a key player in the high-performance computing ecosystem.A major positive for the quarter is Marvell’s partnership with Microsoft, where its FIPS 140 Level-3 compliant liquid security hardware modules have been integrated into Azure Key Vault offerings. This strengthens Marvell’s footprint in cloud security and enterprise encryption, adding another layer of revenue diversification.3Q25 Revenue Summary By End MarketImage Source: Marvell Technology, Inc.Improved inventory corrections and recovering demand are helping Marvell’s Networking and Carrier segments rebound. Our projections indicate that Enterprise Networking and Carrier revenues will each rise by 16.8% sequentially, reaching $176.3 million and $98.3 million, respectively.While carrier spending remains volatile, the company is benefiting from new design wins in cloud-driven networking solutions. As telecom providers upgrade their infrastructure for AI-driven applications, Marvell’s networking division should continue to see steady improvements.The Automotive and Industrial divisions have been a consistent revenue contributor for Marvell, thanks to the increasing semiconductor content in vehicles and industrial automation growth. For the fourth quarter, our model estimates peg Automotive/Industrial revenues at $84.9 million, indicating a 2.4% sequential improvement. With automakers ramping up production of connected and electric vehicles, Marvell’s automotive ethernet solutions and advanced driver-assistance system (ADAS) technologies should continue to see steady adoption.Despite the strength of Marvell’s data center, networking and AI segments, its consumer end market remains a weak spot. Seasonality in gaming and broader macroeconomic uncertainty may have resulted in a 15% quarter-over-quarter revenue decline to $82 million for this segment, as per our model estimates. Gaming demand typically weakens in the fourth quarter and bottoms out in the first quarter.MRVL Stock Price Performance & ValuationYear to date (YTD), Marvell shares have plunged 16.8%, underperforming the Zacks Electronics – Semiconductors industry’s decline of 9.2%. Comparing the stock’s performance with industry peers, MRVL has underperformed Cirrus Logic, Inc. CRUS, Lattice Semiconductor Corporation LSCC and Nova Ltd. NVMI.YTD MRVL Stock Price Return PerformanceImage Source: Zacks Investment ResearchNow, let’s look at the value Marvell offers investors at the current levels. Despite the recent fall, MRVL stock trades at a premium with a forward 12-month price-to-sales (P/S) multiple of 9.66X compared with the industry’s 7.45X.MRVL Forward 12-Month P/S RatioImage Source: Zacks Investment ResearchInvestment Consideration for MRVLMarvell’s custom silicon business is a game-changer, particularly in the booming data center market. Cloud service providers rely on its highly specialized chips to optimize AI computing efficiency, networking speed and energy consumption.In the third quarter of fiscal 2025, Marvell’s data center end market posted robust growth, driven by the rising adoption of AI-specific compute solutions. Management forecasts sequential revenue growth in the low-to-mid 20% range for the fourth quarter, a strong indicator of sustained AI-driven demand.Additionally, Marvell is leading the charge in next-gen data center connectivity with investments in PCIe Gen 6 retimers and advanced interconnect technologies, ensuring faster and more reliable AI workloads. These advancements solidify Marvell’s role as a cornerstone of AI infrastructure, giving it a long-term competitive advantage.Conclusion: Buy MRVL Before Q4 ResultsMarvell’s upcoming quarterly results are likely to demonstrate the beginning of a multi-year growth story fueled by AI innovation. The company’s leading position in AI infrastructure, custom silicon and next-generation data center solutions make it a must-own stock for investors betting on the future of AI-driven computing.While the stock trades at a premium valuation, its explosive growth prospects and strong financial execution more than justify the price. For those looking to ride the AI and semiconductor revolution, Marvell remains a top-tier investment.Just Released: Zacks Top 10 Stocks for 2025Hurry – you can still get in early on our 10 top tickers for 2025. Handpicked by Zacks Director of Research Sheraz Mian, this portfolio has been stunningly and consistently successful. From inception in 2012 through November, 2024, the Zacks Top 10 Stocks gained +2,112.6%, more than QUADRUPLING the S&P 500’s +475.6%. Sheraz has combed through 4,400 companies covered by the Zacks Rank and handpicked the best 10 to buy and hold in 2025. You can still be among the first to see these just-released stocks with enormous potential. See New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Marvell Technology, Inc. (MRVL): Free Stock Analysis Report Lattice Semiconductor Corporation (LSCC): Free Stock Analysis Report Cirrus Logic, Inc. (CRUS): Free Stock Analysis Report Nova Ltd. (NVMI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks