Have you ever watched a stock you like get absolutely hammered on a rumor, only to find out days later the rumor was complete nonsense? That’s exactly what seems to have happened this week with Marvell Technology.
One day the stock is riding high after a great quarter, the next it’s down double digits because “sources” claim two of its biggest customers are taking their business elsewhere. Sound familiar? Welcome to Wall Street in 2025.
The Rumor That Shook Marvell This Week
Last Tuesday, Marvell Technology delivered earnings that actually impressed most analysts. Revenue beat, guidance was strong, and management talked up massive demand for their data-center products over the next year. They even announced a major acquisition in the photonic space. Classic “everything is awesome” quarter.
Shares popped nicely for a couple of days. Then, out of nowhere, reports surfaced claiming Marvell had lost significant socket wins at two of the largest hyperscalers in the world – the ones everyone immediately assumes are Amazon and Microsoft. The stock gave back all its post-earnings gains and then some.
By Tuesday this week, shares were down more than 3 % in a single session. Classic fear-driven selloff on zero confirmed information.
CEO Matt Murphy Goes on the Offensive
Fast-forward to Tuesday evening. Marvell CEO Matt Murphy sits down for an interview and essentially says: hold up, none of that is true.
“I can tell you this – from Tuesday to Friday, nothing changed. We didn’t lose any business.”
Matt Murphy, CEO of Marvell Technology
He went on to stress that Marvell maintains deep, strategic relationships with all the major U.S. hyperscalers and that the company’s data-center franchise is “rock solid.”
In my experience, when a CEO comes out this quickly and this forcefully to knock down a rumor, it usually means the rumor is either completely fabricated or wildly exaggerated. And sometimes both.
Why These Rumors Appear in the First Place
Let’s be honest – the custom-silicon arms race among hyperscalers is real. Amazon has Graviton and Trainium/Inferia. Microsoft has its own Azure silicon efforts. Meta, Google, and others are all pushing hard on in-house ASICs.
That naturally leads to endless speculation about who is winning or losing particular sockets. Throw in the fact that hyperscalers love to play vendors against each other, and you have a perfect environment for “leak” stories that move stocks.
Sometimes those leaks are strategic plants from a competitor. Sometimes they’re just analysts or reporters connecting dots that aren’t really there. Either way, the market reacts first and asks questions later.
The Actual Fundamentals Haven’t Changed
Step back for a second and look at what Marvell actually reported last week:
-
–>
- Data-center revenue expected to grow dramatically through fiscal 2026
- Custom ASIC programs described as healthy and expanding
- Major new design wins in optical DSPs for AI networking
- Pending acquisition of Celestial AI to bolster photonics roadmap
None of that magically disappeared because of an unverified report.
In fact, Murphy doubled down on the positive outlook and even called the current sell-off “a massive opportunity” for investors. When was the last time you heard a CEO that confident after a 15 % drop?
Valuation Suddenly Looks Attractive
Here’s the part that actually got my attention.
After this week’s pullback, Marvell is now trading below the average forward P/E multiple of the broader semiconductor index. A company growing data-center revenue at 50-70 % rates, with exposure to literally every major AI buildout on the planet, trading cheaper than the average chip stock?
That feels wrong.
Murphy himself pointed it out: “We are not an average company.” Hard to argue when your biggest growth driver is literally the buildout of AI infrastructure.
The Bigger Picture for AI Networking Chips
People sometimes forget that Marvell isn’t trying to beat Nvidia at GPUs. They play in a different part of the stack – high-speed networking, custom compute, electro-optics, storage controllers. All pieces that become more important the larger these AI clusters get.
Rearrange the letters a little and you realize: every trillion-dollar hyperscaler campus needs miles of optical interconnect and mountains of custom silicon that isn’t a GPU. That’s Marvell’s playground.
And with the Celestial AI acquisition, they’re pushing even deeper into co-packaged optics and silicon photonics – technologies many believe are critical for the next leap in cluster performance.
So Is This Dip a Buying Opportunity?
Look, I’m not here to give financial advice, but I’ve been around long enough to recognize when fear temporarily disconnects price from reality.
A CEO coming out within days to flatly deny losing business, combined with fundamentals that still point to explosive growth and a valuation that suddenly looks cheap compared to peers… that’s the kind of setup growth investors dream about.
Of course, things can always change. Hyperscalers could shift spend tomorrow. But based on everything said publicly this week, the rumor mill appears to have gotten way ahead of itself.
Sometimes the best trades are the ones where the story everyone is afraid of turns out to be noise. If Murphy is right – and the company’s guidance holds – then this week’s panic selling could look pretty silly in six months.
Either way, one thing feels certain: the AI infrastructure buildout isn’t slowing down. And companies with strong positions in networking and custom silicon should have plenty of runway left.
I’ll be watching closely. Moments like these don’t come around every day.
