Marvell Technology (MRVL) BofA Securities 2024 Global Technology Conference summary

Financial performance and outlook

• Reported quarterly revenue slightly above $1.16 billion, driven by data center and optics strength.

• AI revenue for the year expected to exceed previous $1.5 billion guidance, with both custom and optics outperforming.

• Q2 revenue guided for 8% growth at midpoint, with acceleration expected in Q3 and Q4, especially in data center.

• Operating leverage and margin expansion anticipated as revenue grows, with strong EPS outlook.

• Long-term operating margin target remains 38%-40%, with line of sight to achieve this in the next 12-18 months.

Segment trends and recovery

• Data center and optics continue to show robust growth, offsetting weaker enterprise and carrier segments.

• Carrier market correction expected to bottom in first half, with new design ramping in Q4.

• Enterprise and auto segments show signs of recovery, but inventory digestion remains a key factor.

• Automotive growth re-accelerating in the second half, with broader design wins including ICE vehicles.

• Wireless market share expected to increase with new 5G products ramping this year and next.

Data center and AI dynamics

• AI-related data center revenue projected at $1.5 billion floor, with two-thirds from optics and one-third from custom, both trending higher.

• AI now represents a rapidly growing share of revenue, potentially reaching 30% of total.

• Standard cloud infrastructure investment is also rebounding, supporting optics and switching businesses.

• Larger AI cluster sizes drive higher optical attach rates and demand for advanced interconnect solutions.

• 1.6T optics product ready for next-gen accelerators, with significant ramp expected next year.