Research|MRVL: Investor Day Targets Move Closer to Our Forecasts

Marvell outlined an ambitious outlook at its October 6 investor day, targeting CY30 (FY31) revenue of $80b at the midpoint and non-GAAP EPS of more than $30.

Marvell described a diversified portfolio built to capture AI infrastructure growth:

• Optical interconnect products across form factors (pluggables, NPO and CPO) and distances (scale-in to scale-across).
• Large custom XPU programs.
• A broad XPU attach portfolio that builds on hyperscalers’ familiarity with its off-the-shelf products and growing demand for custom solutions.

In our earnings reviews, we have repeatedly noted that Marvell had room to raise its interconnect and custom revenue guidance. Its guidance is now catching up with our model. We think this and the more ambitious 2030 targets reflect greater confidence in the supply chain. The investor day follows Matt Murphy’s comments about suppliers at the Citi TMT conference last month and recent deals with GlobalFoundries and AT&S. COO Chris Koopmans said key foundry, substrate and packaging suppliers receive five-year forecasts and had already seen the $70–90b FY31 target before the event. Marvell is making capacity payments to reserve supply ahead of revenue. He also stressed that demand and supply are in place to support the $20b FY28 revenue target.

Financial Targets

Revenue growth: Marvell’s CY25–CY30 target financial model calls for a 55%–60% revenue CAGR over FY26–FY31.

Profitability and Operating Leverage:

• Gross margin: The 56%–59% target range reflects the product mix. A higher custom silicon mix pushes margin toward the low end but brings more revenue; a higher connectivity mix pushes margin toward the high end.
• Operating margin: The 44%–46% target is six percentage points above the previous target, with operating expenses expected to grow at half the percentage rate of revenue.
• Earnings: The model targets non-GAAP EPS of more than $30 in FY31, summarized as the “30 in 30” goal: more than $30 EPS in calendar 2030.
• Our cross-check: Applying the midpoints mechanically (57.5% gross margin, opex growing at half the rate of revenue) gives an operating margin of ~49% and EPS of ~$34 on ~966m fully diluted shares, above both the 44–46% operating margin target and the >$30 EPS target.

Capital allocation: The company expects to return more than 50% of FCF on average over time. At $80b of revenue and a 36% FCF margin, this implies more than $14.4b of capital returns in 2030.

TAM and Market Share

Marvell presented ambitious TAM forecasts, lifting the shares of peers such as Ciena and Astera Labs. Combining slides 31 and 40 of the investor day presentation gives the estimates below.

This is consistent with management’s commentary. Interconnect revenue grows in line with its ~65% TAM CAGR, so share holds at just under 60%; Matt Murphy said he expects scale-out and scale-across to grow with their markets without losing share.

Custom is where Marvell is underwriting share gains, roughly doubling from ~6% to ~13%. Switching and storage edges up to ~12%, with switching expected to grow faster than the combined segment.

Overall, Marvell goes from ~14% to ~20% share of its addressable market.

Interconnect