Analysts Are Bullish on Marvell Stock Despite Amazon Deal Concern

Key Points

• Marvell Technology has been notably lagging in 2025, hardly recovering from its lows.
• The company's earnings results were rather lackluster, but management added important commentary related to its hyperscaler customers.
• The average updated price targets are over 50%, while the most bearish targets are near the stock's May 30 price.

Unlike its big brother, Broadcom NASDAQ: AVGO, custom chip maker Marvell Technology NASDAQ: MRVL has yet to participate much in the recent recovery among semiconductor stocks. This became even more true after the company’s latest earnings, which failed to inspire investors.

The day after the company’s results came out on May 29, Marvell's shares dropped by around 5.5%. Overall, Marvell shares are still down around 45% from the May 30 close, only recovering moderately from the -55% depths reached in early April. Meanwhile, the iShares Semiconductor ETF NASDAQ: SOXX is now down only around 5% compared to April lows of -28%.

Despite the highly disappointing performance of Marvell shares in 2025, Wall Street analysts continue to see substantial upside potential in the stock. Among MarketBeat-tracked updates after the results, the average price target is just over $92. This figure implies upside of 53% in Marvell shares compared to their May 30 closing price. Let’s break down Marvell’s recent results and important management commentary.

Marvell’s Earnings: Solid But Not Spectacular

Although Marvell’s fiscal Q1 2026 earnings report was nothing to write home about, it was not bad by any means. The company saw sales growth of just over 63%, slightly faster than the 62% growth anticipated. This helped the company beat adjusted earnings per share (EPS) estimates by one cent, coming in at 62 cents. The midpoint of the company’s fiscal Q2 sales and EPS guidance was just barely higher than analyst forecasts.

Despite shares declining significantly, external factors also likely played a big role. Chip stocks were down generally on May 30. This came after President Trump alleged that China violated its trade deal with the United States. The administration also reportedly plans to broaden sanctions on the country’s tech sector.

Revenue from Marvell’s data center end market continued to grow rapidly at 76% from the prior year. Overall, four out of the company's five end markets experienced growth from the prior year quarter. These results were generally very strong, but expected. The more interesting developments came in the firm’s earnings call.

Marvell Sheds Important Light on Hyperscaler Relationships

One of the key things investors wanted clarity on in Marvell’s earnings call was the company’s relationship with Amazon.com NASDAQ: AMZN. Back in December 2024, Marvell signed a five-year deal with Amazon Web Services, Amazon’s cloud computing arm. This deal, among other things, confirmed Marvell as the supplier of AWS’s custom chips. However, it didn’t necessarily mean AWS couldn’t make deals with other suppliers. In the following months, worries grew that AIchip Technologies might have won the deal for AWS's next-generation Trainum 3 chip.

However, the company added commentary that eased concerns but also added some credence to the rumors. The company mentioned that its AI XPU program for a large hyperscale customer is “doing extremely well.” This is in reference to AWS’s Trainium 2 chip, and production is ramping up. Management added that they are “fully engaged” with this customer on their next-generation chip, Trainium 3.

Production of this chip will ramp up in calendar year 2026. They went on to say that this ramp-up was consistent with the “multigenerational nature” of the partnership, a nod to the five-year AWS deal. The company anticipates that custom AI XPU revenue from this customer will continue to accelerate in 2026 and beyond.

However, when asked about whether the company’s deal to develop AI XPUs was exclusive, management said, “It's certainly possible and likely that customers and our customers may be pursuing multiple paths to meet their requirements."

This adds some weight to the idea that AIchip is also engaged with AWS.

The company said it is making progress on an AI XPU with another hyperscaler. It is also working with this customer on future-generation chips. Most think that the customer is Microsoft.

MRVL’s Most Bearish Price Target Indicates Shares Are Fairly Valued, a Positive Sign for Upside

Analysts generally remained confident in Marvell’s relationship with AWS, even though AIchip is still a concern. Even the most bearish analyst, Cantor Fitzgerald, places a price target of $60 on Marvell. This is just slightly lower than the stock’s closing price of $60.19 on May 30. In general, given the company’s solid AWS and Microsoft partnerships amidst competition, Marvell stock seems poised for a potential recovery. The upcoming event on June 17, focusing on the Future of Custom Silicon Technology for AI Infrastructure, could serve as a positive catalyst.