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Marvell Technology (NASDAQ: MRVL) reported a 21.8% decline in stock price in August following its fiscal second-quarter earnings release on August 28, 2023. The company reported revenue of just over $2 billion, representing a 58% increase year-over-year, but fell short of analyst expectations. Adjusted earnings per share were $0.67, meeting projections. Concerns over “lumpy” deployments of custom AI ASICs from its lead customer and a forecast of flat revenue for the upcoming quarter have raised investor fears.
The data center segment, which includes ASICs, experienced a 69% growth, yet the predicted stagnation in revenue growth this quarter is troubling investors, especially as competitors like Broadcom (NASDAQ: AVGO) do not face similar issues. Approximately 75% of Marvell’s business is now from AI-oriented data center operations, highlighting the importance of future growth in this area to stabilize investor confidence.
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