Marvell Technology, Inc. Q3 FY2022 Earnings Call

· Earnings call transcript and AI-powered summary

Key Financial Highlights

  • Q3 revenue: $1.21B, up 13% sequentially and 61% year-over-year, exceeding guidance.
  • GAAP gross margin: 48.5%. GAAP operating loss: $33M. GAAP EPS: -$0.08.
  • Non-GAAP gross margin: 65.1% (record). Non-GAAP operating income: $418M. Non-GAAP EPS: $0.43, up 72% year-over-year.
  • Innovium contributed $5M to Q3 revenue following acquisition (25 days of inclusion).
  • Strong supply improvement helped deliver revenue 6% above midpoint of guidance.
  • Cash flow from operations: $265M. Debt reduced by $151M (long-term debt at $4.5B).

Q4 Fiscal 2022 Guidance

  • Revenue outlook: $1.32B ± 3%.
  • Non-GAAP gross margin: ~65%.
  • Non-GAAP EPS: ~$0.48 ± $0.03.
  • Includes full-quarter contribution from Innovium (~$15M in OpEx).
  • Expect continued supply improvements but demand still exceeds available supply.

End Market Performance

Data Center

  • Q3 revenue: $500M, up 15% sequentially and 109% year-over-year.
  • Growth driven by cloud demand across PAM4 optics, ZR modules, SSD/HDD controllers, custom SoCs, Ethernet switches.
  • Innovium integrated; expected to add $150M revenue in fiscal 2023 from Tier 1 cloud customer ramp.
  • Q4 forecast: double-digit sequential growth; revenue to more than double year-over-year.

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Operator: Good afternoon, and welcome to the Marvell Technologies Fiscal Third Quarter 2022 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Mr. Ashish Saran, Vice President of Investor Relations. Please go ahead. Ashish Saran: Thank you, and good afternoon, everyone. Welcome to Marvell’s third quarter fiscal year 2022 earnings call. Joining me today are Matt Murphy, Marvell's President and CEO; and Jean Hu, our CFO. I would like to remind everyone that certain comments made today may include forward-looking statements, which are subject to significant risks and uncertainties that could cause our actual results to differ materially from management’s current expectations. Please review the cautionary statements and risk factors contained in our earnings press release, which we filed with the SEC today and posted on our website, as well as our most recent 10-K and 10-Q filings. We do not intend to update our forward-looking statements. During our call today, we will refer to certain non-GAAP financial measures. A reconciliation between our GAAP and non-GAAP financial measures is available in the Investor Relations section of our website. We closed the acquisition of Innovium on October 5, 2021. Therefore, the results we reported today for the third quarter of fiscal 2

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