Marvell Technology 2026 Q3 Earnings Profitability Surges 381.1%

Marvell Technology (MRVL) reported a dramatic turnaround in fiscal 2026 Q3 earnings, with revenue rising 36.8% year-over-year to $2.07 billion and net income leaping to $1.9 billion, reversing a $676.3 million loss in the prior year. The company exceeded revenue and EPS expectations while raising its full-year guidance, reflecting strong demand for AI-driven data center solutions and strategic acquisitions.

Revenue

Marvell’s total revenue surged to $2.07 billion in Q3 2026, a 36.8% increase from $1.52 billion in the same period last year. The data center segment led growth, contributing $1.52 billion, driven by AI infrastructure demand. Enterprise networking added $237.2 million, carrier infrastructure $167.8 million, consumer $116.6 million, and automotive/industrial $35 million. The performance underscored the company’s dominance in data center and networking markets.

Earnings/Net Income

Marvell returned to profitability with EPS of $2.22 in Q3 2026, a 384.6% improvement from a $0.78 loss in Q3 2025. Net income soared to $1.9 billion, a 381.1% swing from a $676.3 million loss, reflecting robust cost management and favorable product mix. The turnaround highlights the company’s ability to capitalize on high-margin data center and custom ASIC sales.

Post-Earnings Price Action Review

The strategy of buying MRVL when revenue beats expectations and selling after 30 days delivered a 362.13% return, significantly outperforming the 137.15% benchmark. With an excess return of 224.98%, zero maximum drawdown, and a Sharpe ratio of 0.55, the strategy demonstrated strong risk-adjusted returns and resilience during the backtest period.

CEO Commentary

CEO Matthew Murphy highlighted record revenue of $2.075 billion, driven by 38% YoY data center growth fueled by AI demand. He emphasized strategic acquisitions like Celestial AI to lead in photonic fabric technology and projected data center revenue growth over 25% in FY2027. Murphy expressed confidence in long-term AI infrastructure tailwinds.

Guidance

Marvell guided Q4 2026 revenue to $2.2 billion (midpoint), with data center revenue expected to grow 20–25% YoY in FY2027. Non-GAAP EPS guidance for Q4 is $0.74–$.84, with operating expenses rising at half the revenue growth rate.

Additional News

Marvell’s $3.25 billion acquisition of Celestial AI aims to expand its optical interconnect capabilities, with the deal expected to close in Q1 2026. The company also announced a $5 billion share repurchase program, reflecting confidence in its undervalued stock. CEO Murphy highlighted AI-driven demand, projecting data center revenue to grow 30% YoY in FY2027.

CEO Matthew Murphy’s Comments on AI Growth

Matthew Murphy emphasized the transformative impact of AI on data center infrastructure, stating, “We’re positioned for several years of exceptional performance as AI adoption accelerates.” The acquisition of Celestial AI underscores Marvell’s commitment to leading in photonic fabric technology, with partnerships with Amazon and Microsoft solidifying its role in future AI ecosystems.

M&A and Strategic Moves

The Celestial AI acquisition is projected to add $500 million in revenue by Q4 2028 and expand Marvell’s total addressable market to $94 billion by 2028. The deal complements Marvell’s electro-optical portfolio, enabling next-generation AI and HPC architectures.

Capital Return Initiatives

Marvell’s $5 billion share repurchase program, authorized in September 2025, allows the company to buy back up to 7.8% of its shares. This move signals management’s confidence in the stock’s value and aligns with its disciplined approach to capital allocation.

Risks and Outlook

While the company faces integration risks from the Celestial AI acquisition and potential volatility in custom revenue, its strong balance sheet and AI-driven growth trajectory position it for long-term success. Analysts remain cautiously optimistic, with a “Moderate Buy” rating and a consensus price target of $96.59.

Financial Resilience

Marvell’s Q3 results highlighted a 36.8% revenue increase, 36.3% operating margin, and 59.7% gross margin, the highest in its history. The company’s free cash flow surged 69.9% YoY to $463.5 million, supported by disciplined inventory management and cost controls.