By Nate Wolf
Marvell Technology has had a strange week. And the whiplash may continue as investors debate the fate of the company's custom chip business.
A week ago, Dec. 2, the chip maker reported better-than-expected quarterly earnings and forecast strong growth in its data-center segment, which counts Amazon.com and Microsoft as customers. Marvell, which makes both standard chips and custom solutions for its clients, rose sharply.
But two weekend reports -- one from The Information and another from Benchmark Equity Research -- claimed Marvell was at risk of losing crucial orders at Microsoft and Amazon Web Services, respectively. The stock gave back most of last week's gains on Monday, falling 7% to $92. It dropped another 2.6% shortly after the opening bell Tuesday.
Microsoft declined to comment. Amazon Web Services and Marvell didn't immediately respond to requests for comment.
Analysts at Stifel called the reports "without merit" and "misleading" in a research note Monday, reiterating a Buy rating and a $114 price target for Marvell shares.
Without addressing the various players by name, the analysts seemed to first push back on The Information's report that Microsoft was in talks to switch to Broadcom from Marvell for its custom chip business. Such a move wouldn't match typical design cycles, Stifel argued, because it would take three to four years to develop the chips that might replace those Marvell makes for the company.
"We believe the timeline of this speculation is misaligned with this reality," wrote analyst Tore Svanberg. "Any hypothetical partner switch discussions actively occurring would not be meaningfully impactful to revenue until FY29 at the earliest."
On last week's earnings call, Marvell CEO Matthew Murphy said the company expects its custom chip business to expand by at least 20% next year. The forecast also included a transition to a next-generation chip at a large customer, though Murphy didn't specify which one.
Any major cancellation would likely trigger a regulatory disclosure from Marvell, Stifel said, and that hasn't happened.
The firm also appeared to respond to Benchmark's research note concluding that Marvell has lost the business to provide the design for Amazon's Trainium 3 and 4 chips. Marvell may not have the exact level of content in the new-generation chips as it did in Trainium 2, Stifel said, but Marvell's guidance appeared solid anyway.
Analysts at J.P. Morgan had an even firmer opinion. The bank said in a note published before Monday's pullback that Marvell is already working on the Trainium 3 and 4 projects.
"Block out the noise," J.P. Morgan analyst Harlan Sur told investors. Marvell hasn't lost share at Microsoft or Amazon, he concluded, reiterating an Overweight rating and a $130 price target.
This back and forth sends a message: Wall Street has reached the "he said, she said" phase in reacting to Marvell's earnings.
Shareholders have plenty of reports, evidence, and opinions to parse. At this point, though, only Marvell itself is in position to know where the company's custom chip business stands.
Write to Nate Wolf at nate.wolf@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
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December 09, 2025 10:49 ET (15:49 GMT)
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