Analyst(s): Brendan Burke
Publication Date: May 29, 2026
Marvell’s quarter and outlook reflect rising demand for connectivity and custom silicon inside AI data centers. The quarter also introduced clearer signals on how optics, switching, and XPU programs may shape growth into FY 2028 and beyond.
What is Covered in This Article:
- Marvell’s Q1 FY 2027 financial results
- Interconnect demand shifting to 1.6T and scale-across
- Switching ramps in 51.2T and beyond
- Custom silicon and XPU-attach expansion
- Guidance and Final Thoughts
The News: Marvell Technology (NASDAQ: MRVL) announced financial results for Q1 FY 2027. Net revenue was $2.418 billion, up 28% year on year (YoY), versus the Wall Street consensus of $2.41 billion. Data center revenue was $1.83 billion, up 27% YoY, and communications and other revenue was $585.1 million, up 29% YoY. Non-GAAP gross margin was 58.9% versus 59.8% in Q1 FY 2026. Non-GAAP operating income was $846.9 million (Q1 FY 2026: 647.3 million) with a 35% non-GAAP operating margin (Q1 FY 2026: 34.2). Non-GAAP diluted earnings per share were $0.80 (Q1 FY 2026: 0.62).
“We expect revenue growth to continue accelerating each quarter throughout fiscal 2027, driven by continued strength in our data center business,” said Matt Murphy, chairman and chief executive officer of Marvell. “We are seeing exceptional AI-related bookings, and as a result, we are significantly raising Marvell’s revenue outlook for both fiscal 2027 and fiscal 2028 compared with the guidance we provided last quarter. This improved outlook is being driven by strong demand across a broad set of Marvell solutions, including 800G and 1.6T scale-out optics, 51.2T Ethernet scale-out switches, scale-up optical solutions for NPO and CPO applications, scale-across datacenter interconnect modules, and custom XPU and XPU-attach solutions.”
Marvell Q1 FY 2027 Raises Full-Year Outlook on AI Data Center Demand
Analyst Take: Marvell tied its raised outlook to AI-related bookings and a broader set of data center connectivity and custom silicon programs. The company’s commentary puts networking and optics closer to the center of the AI infrastructure spend cycle, not just GPUs and memory. It also signaled that scale-up, scale-across, and XPU attach use cases are growing alongside traditional scale-out build-outs. That mix implies higher content opportunities where Marvell already has products shipping, plus newer categories are still early in revenue contribution.
Interconnect Moves Beyond Scale-Out
Marvell expects its interconnect business to grow more than 70% YoY in FY 2027, above its prior view of roughly 50% growth. The company framed the shift as demand moving from earlier scale-out bottlenecks toward larger architectures that require more bandwidth and lower latency networking. It described scale-across deployments as a driver of higher pluggable data center interconnect bandwidth needs, with 1.6T connectivity expected to ramp faster than earlier front-end DCI upgrades. Marvell also tied longer-reach intra-campus use cases to coherent-lite and added security features such as integrated MACsec in the next generations. Scale-across and 1.6T adoption can reshape the module and optics value chain faster than many roadmaps assume.
Switching Ramps as AI Networking Content Rises
Marvell forecast scale-out switching revenue in FY 2027 to exceed $600 million, roughly doubling from FY 2026, and indicated a path to more than $1 billion annualized revenue in FY 2028. The company positioned the 51.2T Ethernet platform as a key ramp driver, while it also pointed to engagement around a 100T platform where power efficiency and latency become differentiators for AI workloads. It also increased its emphasis on scale-up switching, arguing PCIe radix and bandwidth limits can force a move to purpose-built scale-up switching protocols. The near-term takeaway is that switching growth depends on scale-up networking standards settling. Marvell’s execution risk is less about roadmap visibility and more about converting multi-engagement activity into repeatable production ramps.
Custom Silicon Expands Into XPU Attach and New Programs
Marvell kept its FY 2027 expectation that custom revenue grows more than 20% YoY, led by a flagship XPU program and rising XPU-attached programs such as NIC and CXL-related designs. For FY 2028, it raised expectations to more than double custom revenue YoY, driven by existing program growth, more than 10 XPU attached programs reaching higher volumes, and a new Tier 1 XPU program entering volume production. It also reiterated a longer-term target model for custom to reach more than $10 billion in FY 2029 revenue, based on prior custom silicon TAM sizing and share assumptions. The company linked XPU attach growth to inference-driven needs, such as KV cache and memory architecture changes, which can increase demand for NIC- and CXL-memory-attached use cases. Custom silicon growth is becoming a portfolio of ramps rather than a single-customer story.
Guidance and Final Thoughts
For Q2 FY 2027, Marvell guided net revenue to $2.700 billion plus or minus 5%, above consensus of $2.61 billion, and non-GAAP diluted earnings per share to $0.88 to $0.98. It also raised its FY 2027 revenue outlook to nearly $11.5 billion, implying about 40% YoY growth, and raised its FY 2028 revenue outlook to about $16.5 billion, implying about 45% YoY growth off the higher FY 2027 base. The company also disclosed plans for about $1 billion in supplier prepayments in FY 2027 to support capacity needs tied to AI-related demand.
Marvell’s updated outlook suggests the company is increasingly tied to the networking and connectivity layers that sit underneath large-scale AI deployments rather than relying on narrower communications exposure. The combination of 1.6T optics, scale-up switching, and XPU-attached silicon broadens the number of AI infrastructure spending categories where Marvell can participate, particularly as architectures become more bandwidth-intensive. At the same time, the aggressive capacity planning and multi-year custom silicon assumptions raise the importance of execution consistency, especially if customer deployment timing or networking standards evolve differently than current expectations imply.
See the full press release on Marvell’s Q1 FY 2027 financial results on the company website.
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Other Insights From Futurum:
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Broadcom’s DSP Launch Intensifies the AI Optics Race with Marvell
Will NVIDIA Investment Accelerate Marvell’s XPU Growth?
Author Information
Brendan is Research Director, Semiconductors, Supply Chain, and Emerging Tech. He advises clients on strategic initiatives and leads the Futurum Semiconductors Practice. He is an experienced tech industry analyst who has guided tech leaders in identifying market opportunities spanning edge processors, generative AI applications, and hyperscale data centers.
Before joining Futurum, Brendan consulted with global AI leaders and served as a Senior Analyst in Emerging Technology Research at PitchBook. At PitchBook, he developed market intelligence tools for AI, highlighted by one of the industry’s most comprehensive AI semiconductor market landscapes encompassing both public and private companies. He has advised Fortune 100 tech giants, growth-stage innovators, global investors, and leading market research firms. Before PitchBook, he led research teams in tech investment banking and market research.
Brendan is based in Seattle, Washington. He has a Bachelor of Arts Degree from Amherst College.
