Can MRVL's AI-Infrastructure Engines Deliver Its Promised Growth?

Marvell Technology MRVL has laid out an ambitious growth trajectory, with revenues expected to increase approximately 40% year over year in fiscal 2027 and another 45% in fiscal 2028 to roughly $16.5 billion. MRVL expects its data center business to remain the primary growth driver, with revenues projected to rise approximately 50% in fiscal 2027 and accelerate to about 55% growth in fiscal 2028.

Rather than relying on a single product cycle, Marvell Technology is participating across five AI infrastructure growth engines: scale-out optics, scale-across data center interconnect (DCI), scale-up optics, Ethernet switching and custom silicon. Scale-out optics remains a key near-term driver as expanding AI clusters increase demand for high-speed connectivity.

Marvell Technology is benefiting from strong 800G PAM4 demand, while the transition to 1.6T is ramping rapidly. Meanwhile, scale-across networks, which connect AI clusters across separate data centers, could create another major opportunity as power and space constraints limit cluster expansion at single locations. MRVL already supplies DCI solutions to all five major U.S. hyperscalers and expects the business to reach a $1 billion annualized revenue rate in fiscal 2028, roughly double fiscal 2026 levels.

Scale-up optics could become another meaningful fiscal 2028 contributor. MRVL is developing NPO and CPO solutions, while Celestial AI’s technology has already been selected by a Tier-1 hyperscaler. The company expects fiscal 2028 scale-up optics revenues to more than double its prior outlook of approximately $150 million. Ethernet switching is also scaling rapidly. MRVL expects scale-out switching revenues to exceed $600 million in fiscal 2027 and track toward a $1 billion annualized rate in fiscal 2028.

Custom silicon could provide the largest fiscal 2028 step-up. After reaching approximately $1.5 billion in revenues, the business is expected to grow more than 20% in fiscal 2027 and more than double in fiscal 2028. These businesses are not expected to peak simultaneously. With near-term momentum from optics and switching and additional contributions expected from DCI, scale-up connectivity and custom silicon, MRVL’s diversified AI infrastructure portfolio provides a credible foundation for its fiscal 2028 growth target.

How Competitors Fare Against MRVL Stock

MRVL faces stiff competition in the AI networking and custom silicon space from Broadcom AVGO and Advanced Micro Devices AMD.

Broadcom is a leader in the domain of custom silicon solutions for data centers. Broadcom’s advanced 3.5D XDSiP packaging platform is critical to ensure the performance and efficiency of custom AI XPUs.

Advanced Micro Devices is another established player in the custom silicon solutions and AI accelerator market. Advanced Micro Devices offers semi-custom SoCs and Instinct Accelerators to power data centers.

MRVL's Price Performance, Valuation and Estimates

Shares of Marvell Technology have gained 186.3% year to date compared with the Zacks Electronics - Semiconductors industry’s growth of 51.1%.

MRVL YTD Performance Chart

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From a valuation standpoint, Marvell Technology trades at a forward price-to-sales ratio of 15.45X, lower than the industry’s average of 9.41X.

MRVL Forward 12-Month (P/S) Valuation Chart

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The Zacks Consensus Estimate for MRVL’s fiscal 2027 and 2028 earnings implies year-over-year growth of 41% and 44%, respectively. Estimates for fiscal 2027 and 2028 have been revised upward in the past 30 days.

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Marvell Technology currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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