Marvell’s Results Solid, but Stock Pricey

Third-quarter revenue was $616.3 million, down 1% versus the recast prior year period (to reflect mobile and wireless businesses classified as discontinued operations). Although storage sales fell 4% year over year to $315.3 million due to seasonality, we do view the aforementioned SSD strength in enterprise and data center as a net positive for the firm. Meanwhile, networking revenue rose 3% from the prior year to $150.5 million, due to the ramp of new switch solutions for the enterprise end-market. Connectivity revenue increased 19% year over year, thanks to strength across gaming, automotive, and voice assist, and streaming markets. Gross margins were 61.3%, up considerably from 56.3% last year thanks to the divestiture of Marvell’s lower-margin multimedia and smartphones businesses.

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