Marvell Technology has experienced a significant downturn in the stock market in 2025, despite showcasing remarkable growth. The company’s stock has fallen by 31% this year, primarily due to Wall Street’s high expectations not being met, despite Marvell’s strong quarterly performance. For instance, a notable drop of nearly 20% occurred in March after the release of results that, while better than the midpoint of projections, fell short of analysts’ elevated forecasts. A similar situation transpired in June, where despite delivering commendable outcomes, concerns about customer relationships led to further declines.
However, analysts see potential for recovery, particularly driven by Marvell’s focus on the burgeoning market for custom AI processors. The company is aiming to increase its share of this market from under 5% in 2023—valued at $6.6 billion—to a substantial 20% by 2028, with expectations that the overall market will expand to over $55 billion. This ambitious goal could lead to Marvell generating $11 billion from custom AI revenue by 2028.
In addition to custom AI, Marvell is also targeting significant expansion in its data center business, which is projected to increase from a market size of $33 billion last year to approximately $94 billion by 2028. The company’s commitment to capturing 20% of this opportunity could result in data center revenue climbing to nearly $19 billion.
Marvell is actively engaged in developing innovative technology, such as smaller and more efficient chips that offer superior performance while consuming less power. Their plans for a 2-nanometer chip platform could reduce energy needs by 20% to 35% while boosting performance by 15% compared to existing 3nm technology.
Given Marvell’s current stock trading at around $80 and a valuation of 22 times earnings—a discount relative to the tech sector—many investors view this as an opportune moment to consider investing. With projections estimating continued double-digit revenue growth and a potential surge in performance driven by advancements in their core markets, Marvell Technology holds promise for long-term growth, even amid the current market challenges.
The situation is a reminder that even enterprises navigating short-term setbacks can offer compelling investment opportunities due to their long-term potential in rapidly growing sectors, such as AI and data centers.