Marvell steadies near $237 as Google warrant, AI earnings take focus

Marvell shares trade near $237 ahead of fiscal Q2 earnings Aug 27, with consensus revenue of $2.71 billion, up 34.74 percent year over year.

Oppenheimer projects Marvell will exceed fiscal Q2 estimates, forecasting adjusted EPS of $0.94 on revenue of $2.73 billion, above FactSet consensus of $0.93 and $2.71 billion, driven by AI demand and new customer orders, the firm said.

The stock closed at $237.13 on Aug 21, down 5.56 percent on the day, after a Google warrant disclosure triggered a pullback from $251.01. The warrant grants Google the right to buy up to 58,970,907 Marvell shares at a $206.58 strike, a notional value of $12.18 billion. In fiscal Q1 2026, Marvell posted revenue of $2.42 billion, up 27.57 percent year over year, with adjusted EPS of $0.80.

The Google agreement for custom AI chips sits at the center of Marvell's growth thesis, with custom ASIC revenue expected to double to more than $4 billion next year and exceed $10 billion by calendar 2028. Options markets imply an 11.31 percent move for MRVL after earnings, roughly $26.80 in either direction, with the stock up about 179 percent year to date.

UBS analyst Timothy Arcuri reiterated a Buy rating on MRVL but lowered his price target to $300 from $340, trimming his next-12-month P/E assumption to 30 times based on the average multiple of compute stocks in UBS coverage. Sell-side consensus carries a moderate buy rating with an average price target of $253.61, implying about 7 percent upside from the Aug 21 close.

Marvell's custom ASIC business, developed in collaboration with hyperscale customers including Google, targets AI training, inference, networking, and storage workloads. The company also partners with Nvidia on NVLink Fusion Technology for networking and storage solutions, embedding Marvell deeper into the AI infrastructure stack. Broadcom remains the primary competitor in custom AI silicon.

Marvell trades at a trailing P/E of 81.26, well above its five-year median of 34.71, while GuruFocus's GF Value estimate of $115.16 puts the stock roughly 106 percent above intrinsic value. Insider sales totaled approximately $15.36 million over the past three months, while 15 gurus hold positions with nine adding and six trimming.

The fiscal Q2 report will test whether Marvell can deliver the double-digit growth baked into its valuation. Investors will watch for updated guidance on custom ASIC ramps and clarity on the Google warrant's financial impact. The next event to watch is the earnings call on Aug 27 after market close.

This article is for informational purposes only and does not constitute investment advice.