Marvell Technology forecasts downbeat Q3 revenue, shares fall over 8%

Marvell Technology forecast Q3 revenue below estimates due to economic uncertainty and tariff concerns. Shares fell 8% in extended trading. The company's custom chip business is performing well, but growth is expected to be non-linear, with Q4 stronger than Q3. Marvell's automotive and industrial, and carrier infrastructure end markets are experiencing weak demand due to customer delays in purchases.

Marvell Technology (MRVL) reported its second-quarter (Q2) fiscal 2026 earnings on Thursday, August 28, with analysts forecasting a third-quarter (Q3) revenue of $2.06 billion, slightly below the average estimate of $2.11 billion [2]. The company's shares fell by 8% in extended trading following the announcement [2].

The Q2 earnings highlighted Marvell's strong performance, with record revenue of $2.006 billion, representing a 58% year-over-year increase. Non-GAAP earnings per share (EPS) reached $0.67, more than doubling the prior-year figure and at the top end of guidance [3, 4]. The data center segment, which generated $1.49 billion in revenue, was a key driver of growth, with a 69% year-over-year increase [3, 4]. This segment's performance was bolstered by robust demand for AI-related custom silicon and advanced electro-optics products [3].

However, Marvell's Q3 outlook reflects the broader economic uncertainty and tariff concerns affecting customer spending and overall demand. The company expects quarterly revenue of $2.06 billion, with a range of $2.01 billion to $2.11 billion, indicating a potential slowdown in growth compared to the Q2 performance [2]. The automotive and industrial, as well as carrier infrastructure end markets, are experiencing weak demand due to customer delays in purchases [2].

Despite the downbeat Q3 forecast, Marvell's custom chip business continues to perform well. The company is engaged in over 50 new AI opportunities across more than 10 customers, positioning it as a critical supplier in the AI infrastructure buildout [3]. Management expects Q4 to be stronger than Q3, driven by the ongoing recovery in enterprise networking and carrier infrastructure markets [3].

Investors should closely monitor Marvell's strategic initiatives and performance to identify potential long-term growth opportunities. The company's focus on AI infrastructure and 2nm custom silicon technologies has differentiated it from competitors and positioned it as a key player in the AI-driven infrastructure sector [1, 2].

References:
[1] https://www.ainvest.com/news/marvell-technology-strong-growth-prospects-q2-earnings-2508/
[2] https://www.reuters.com/technology/chipmaker-marvell-forecasts-downbeat-quarterly-revenue-shares-fall-2025-08-28/
[3] https://www.stocktitan.net/news/MRVL/marvell-technology-inc-reports-second-quarter-of-fiscal-year-2026-x60a3yvxlmrb.html
[4] https://www.nasdaq.com/articles/marvell-revenue-jumps-58-fiscal-q2