Marvell Technology Group reported third fiscal quarter revenues on Thursday of $750 million, an improvement of 13% over last year.
The growth was driven by a stronger than expected 35% increase in networking infrastructure chips, pushed by strong 5G ramp-ups.
The company announced the purchase of storage and networking chipmaker Inphi for $10 billion in October, which CEO Matt Murphy said Thursday will be “transformational” once approved in the second half of 2021.
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Inphi is expected to accelerate Marvell growth in cloud and 5G with a larger addressable market helped by Inphi’s high performance PAM4 and DSP-based electro-optics products.
Both Marvell and Inphi will also see greater ASICs sales with the use of AI in cloud settings, Murphy added.
In a conference call, Murphy said Marvell has begun to feel supply constraints for products need for data infrastructure. “The rapid recovery this year in the semiconductor industry appears to be stressing significant portions of the supply chain,” Murphy said, according to a Seeking Alpha transcript. “These supply challenges are currently limiting our ability to fully satisfy the increase in demand for some of our networking products.”
However, Murphy said the rollout of 5G outside of China is picking up with momentum accelerating in Japan and the U.S.
For the fourth quarter, Marvell expects revenues of $785 million, including the U.S. export restrictions on Chinese customers.
Marvell shares fell more than 4% after the earnings announcement, reaching $43.40 Friday afternoon.