Marvell Technology (MRVL) is the latest technology company to s& #39;express is profiting from the artificial intelligence (AI) boom, and shares soared on Friday after the company reported its first-quarter results.
Marvell, which manufactures chips network used in data centers, said in its earnings report that revenue will “accelerate” in the second half due to demand for its AI products.
“AI has become a key growth driver for Marvell” said CEO Matt Murphy. He added that while Marvell is still in the early stages of its ramp-up of AI production, “we expect AI revenue in fiscal year 2024 to be at least less than double from the previous year and continue to grow rapidly in the years to come”. "
Marvell expects AI sales to be around $400 million this year and $800 million in 2024. Shares of Nvidia (NVDA) soared yesterday after the semiconductor maker also noted that sales of its AI products were taking off.
First quarter results exceed estimates
During its first fiscal quarter, Marvell published earnings per share (EPS) of $0.31, beating analysts' forecasts. Revenue fell 8.7% to $1.32 billion, but also beat estimates. Following the report, analysts at Deutsche Bank and KeyBanc raised their price targets for the stock.
Marvell shares rose by over 30% today to their highest level in over a year. They are up 34% year-to-date, more than double a 16% gain for the entire Consumer Discretionary sector over the same period.