Semiconductor companies Marvel Technology (NASDAQ:MRVL) is scheduled to report its first-quarter financial results after the market closes on Thursday.
Here are the pre-quarter earnings estimates and analyst commentary:
Revenue estimates: Analysts expect Marvel to report first-quarter revenue of $1.18 billion, according to Benzinga Pro data.
The company reported revenue of $1.32 billion in the first quarter of last year. Marvell has beaten analysts' revenue expectations in eight of the past 10 quarters and has done so for the past five consecutive quarters.
Analysts expect the company to post first-quarter earnings per share of 25 cents, up from 31 cents in the first quarter last year.
The company has beat analysts' earnings per share estimates in seven of the past 10 quarters, and its fourth-quarter results were in line with expectations.
Marvel previously expected first-quarter revenue of $1.15 billion, plus or minus 5 percent, and first-quarter adjusted earnings per share of 23 cents, plus or minus 5 cents.
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Analysts' opinion: Marvell may start shipping AI ASICs to major customers. Amazon and GoogleJPMorgan analyst Harlan Sah said in a new investor note.
The analyst, who has an overweight rating and a $90 price target, said the company is likely to deliver a strong growth profile in the 2024 calendar year.
“The team's two large AI ASIC programs (Amazon Tranium 2 ASIC/Google Axion ARM CPU) began production in the April quarter and shipments in the July quarter, with strong shipment outlook into the second half of the year and FY25,” Sur said.
The analyst also said the data center storage sector could show a recovery during the quarter, leading to more notable growth “for the remainder of the year.”
“We remain overweight as we believe the team's AI ASIC/optical/cloud/storage segments will more than offset the current 5G/enterprise headwinds.”
Rosenblatt analyst Hans Mosesmann said first-quarter sales could fall 20 percent from the previous quarter, which could mark the bottom of the cycle for Marvel.
“We expect some growth in the July quarter, but this is more modest than the consensus forecast of around 6% sequential growth,” Mosesman said. “This is based on our observation that the company will see more stable seasonal patterns and a more gradual non-AI recovery in the second half of the year.”
The analyst said investors are “particularly interested” in Marvel's AI business, which accounts for more than 50% of its revenue.
Key items of note: Marvel's earnings report comes amid lingering questions about when the company will see growth again.
Marvell shares fell after the release of its fourth-quarter earnings after the company's guidance disappointed investors.
“While we expect weaker demand in the near term impacting consumers, operator infrastructure and enterprise networks, we expect revenue declines in these end markets to subside after the first quarter and recover in the second half of the fiscal year,” Marvell's CEO said. Matthew Murphy He made the remarks after the company's fourth-quarter earnings report.
Based on analyst comments, the first quarter could be the bottom for the company, with growth likely to come later this year.
While many semiconductor stocks like Nvidia have risen in value in 2024, Marvell's gains are coming from popular iShares Semiconductor ETF (NASDAQ:SOXX). The ETF is up 24.2% year to date and 68.7% over the past year. Marvel shares are up 28.4% year to date and 68% over the past year.
Marvel is 14Number The ETF's largest holding is 3.9% of assets, while Nvidia tops the list with 9.8%.
MRVL Price Trend: Marvell shares were trading up 1% to $77.46 as of Tuesday's announcement, but their 52-week trading range is $46.07 to $85.76.
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