Chipmaker Marvell Technology (MRVL) late Thursday beat Wall Street’s estimates for its fiscal second quarter and guided modestly higher for the current period. But MRVL stock fell in extended trading.
The Santa Clara, Calif.-based company earned an adjusted 34 cents a share on sales of $1.076 billion in the quarter ended July 31. Analysts had expected Marvell earnings of 31 cents a share on sales of $1.066 billion, according to FactSet. On a year-over-year basis, Marvell earnings jumped 62% while sales surged 48%.
Marvell’s second-quarter results got a boost from the company’s $10 billion acquisition of Inphi, which it completed on April 20.
“Growth was driven by the data center, which now represents Marvell’s largest end market at 40% of total revenue, benefiting from our growing momentum in the fast-growing cloud infrastructure market,” Chief Executive Matt Murphy said in a news release.
MRVL Stock Sells Off
In after-hours trading on the stock market today, MRVL stock slid 4.3%, near 60.55. During the regular session Thursday, MRVL stock rose a fraction to 63.24. Earlier in the day, MRVL stock notched a record regular-session high of 64.07.
For the current quarter, Marvell forecast adjusted earnings of 38 cents a share on sales of $1.145 billion. Wall Street had predicted earnings of 37 cents a share on sales of $1.135 billion.
“We expect year-over-year revenue growth will accelerate in the third quarter, led by substantial contributions from the cloud data center market,” Murphy said. “In addition, we expect our 5G business to continue to grow with strong sequential revenue growth in the third quarter, and a significant step up projected in the fourth quarter.”
Marvell Breaks Out Of Consolidation
On June 24, MRVL stock broke out of a 21-week consolidation period at a buy point of 55.80, according to IBD MarketSmith charts. As of Thursday’s close, it was extended beyond the buy zone, based on IBD trading principles.
MRVL stock is on the IBD Stock Spotlight watchlist.
Marvell makes networking and data storage chips used in cloud computing, automotive, communications and other applications.
On Aug. 3, Marvell announced plans to acquire Innovium, a provider of networking products for cloud and edge data centers, for $1.1 billion in stock. Marvell expects the acquisition to add $150 million in incremental revenue next fiscal year. The deal is scheduled to close by the end of the calendar year.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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