Marvell Shares Tumble 8% Despite Record Revenue and Raised Guidance as Google Deal Timing Disappoints

Marvell Technology reported record fiscal second-quarter revenue of $2.739 billion, up 37% year over year and 13% sequentially, with data center revenue surging 46% to $2.17 billion, yet shares fell roughly 8 to 10 percent on Friday and slipped below the 50-day moving average. The selloff came despite third-quarter guidance of $3.15 billion, above the $3.04 billion consensus, and raised full-year outlooks of approximately $12 billion for fiscal 2027 and $18 billion for fiscal 2028, implying roughly 50% growth. Investor frustration centered on the recently announced Alphabet partnership, which analysts say could generate up to $120 billion in cumulative revenue over six to six and a half years with warrant vesting tied to incremental sales milestones, but management provided little clarity on when that deal would materially lift reported revenue.

Morgan Stanley noted the Google customer was already embedded in prior guidance and was not a new upside surprise, which left expectations unmet. Gross margin pressure added to the concern, as a rising mix of lower-margin custom silicon is expected to weigh on profitability as those programs ramp. The stock had gained roughly 162% in 2026 through Thursday's close, and Jim Cramer and others characterized the drop as a valuation reset rather than a fundamental problem with the quarter.

Nearly a dozen Wall Street analysts maintained bullish ratings: UBS kept a Buy with a $310 price target, Oppenheimer raised its target from $300 to $325, Needham raised its target to $300, and Morgan Stanley held an Equal Weight with a $246 target. Management shifted its long-term growth narrative toward connectivity, optics, and broad XPU-attach businesses rather than relying solely on monolithic custom ASIC wins, which Seeking Alpha's quant model and several analysts view as improving visibility but also raising execution risk given a heavily back-loaded fiscal 2027 and a record fourth quarter required to hit full-year targets.