Bookmark and Share

Marvell Technology’s Shares Rally on Upbeat Q1 Outlook (MRVL)

Shares of Marvell Technology Group Ltd. (NASDAQ: MRVL) leaped almost 5.50% in afterhours trading on Thursday after the chip maker provided upbeat outlook on the current quarter, thanks to its growing traction in hard disk drive  and flash storage business.

The Company’s fiscal fourth-quarter results also edged past Street’s estimates.

The Santa Clara, California-based Company, which makes devices used in handsets along with other consumer electronics goods, said that results were in particular bolstered by stronger demand for mobile phones in the North American region.

While speaking to analysts in a conference call, Marvell’s Clara Chief financial Officer, Brad Feller said that Blackberry’s generation next handsets, which hit the market recently, could drive up Marvell’s business since the smartphone makers uses chips made by Marvell.

For the fiscal fourth quarter ended February 2, Marvell reported net income of $50 million or 9 cents a share, compared to a profit of $81 million or 13 cents a share, in the year earlier quarter.

Excluding onetime items, adjusted or non-GAAP earnings came at 19 cents a share.

Revenue during the period climbed 4% to $775 million.

Analysts’ consensus estimate was for earnings of 13 cents a share on revenue of $720.9 million.

For the current quarter, Marvell expects adjusted earnings of 14 cents a share, plus or minus 2 cents, a share on revenue of $700 million to $740 million.

Analysts polled by Thomson Reuters had most recently forecasted earnings of 13 cents a share on revenue of $710.8 million.

The better-than-expected forecast holds lots of significance since Marvell’s rival LSI Corp last month provided a downbeat outlook on the current quarter revenue.

The company also announced that it intends to pay its next quarterly dividend of  6 cents a share on April 4 to all shareholders of record as of March 14.