AI Demand Powers Chipmaker Marvell’s Q1 Outperformance But Stock Drops: Retail Keeps Faith

Marvell Technology, Inc. (MRVL) stock retreated in Thursday’s extended session after the data infrastructure chipmaker announced forecast-beating quarterly results and issued in-line guidance.

The Santa Clara, California-based company reported adjusted earnings per share (EPS) of $0.62 for the first quarter of the fiscal year 2026, up from the year-ago’s $0.60 and exceeding the $0,61 consensus. 

Net revenue jumped 63% year over year (YoY) to a record $1.895 billion versus Wall Street’s average estimate of $1.88 billion.

Both metrics fell within the guidance ranges issued along with the fourth-quarter results in early March. 

The adjusted gross margin came in at 59.8% compared to the 60% rate the company had forecast earlier.

CEO Matt Murphy attributed the performance to strong artificial intelligence (AI) demand in the data center end market, benefiting from the rapid scaling of custom silicon programs and robust shipments of electro-optics products.

He said, “We see our custom silicon business driving strong growth in the second quarter and beyond.”

The company said it has scheduled its Customer AI Investor Event for June 17, during which it will showcase its expanding opportunity.

Looking ahead, Marvell expects second-quarter adjusted EPS of $0.67, +/- $0.05, and revenue of $2 billion, +/- 5%.  Analysts, on average, expect the metrics to come in at $0.67 and $1.98 billion, respectively.

The company guided adjusted gross margins to 59%-60%.

By late Thursday, Marvell stock was among the top 10 trending tickers on Stocktwits. Retail sentiment toward the stock was ‘extremely bullish’ (97/100), and the message volume was ‘extremely high.’

A bullish user saw nothing wrong with the earnings report and expected the stock to return to previous highs before the end of the year, saying, "Chart looks primed for it.”

Another user expected a short-squeeze rally.

According to Koyfin data, short interest in the stock is at 3.20%, increasing from 1.70% in February.

Marvell stock ended Thursday’s session down 1.33% at $63.73, before falling 3.30% in after-hours. The stock hit an all-time high of $127.48 on Jan. 23 before pulling back, and it has seen a year-to-date loss of 42%.

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