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Investing.com -- Marvell Technology’s (NASDAQ:MRVL) recent custom AI silicon event drew mixed but mostly positive reactions from Wall Street, with both Barclays (LON:BARC) and Morgan Stanley (NYSE:MS) highlighting an ambitious roadmap underpinned by a rapidly growing opportunity in accelerated computing.
Marvell raised its data center total addressable market (TAM) to $94 billion by calendar 2028, up 26% from the prior estimate. The largest driver is custom accelerated compute, forecast to reach $55.4 billion by calendar year 2028 (CY28). This includes $40.8 billion from custom XPU and $14.6 billion from XPU attach.
Analysts at Barclays see “a $75 billion revenue pipeline consisting of >50 sockets across over 10 customers,” but added that “these potential wins won’t contribute to revenue until 2028 at the earliest.”
Morgan Stanley also pointed to the $94 billion TAM, saying the company is now “targeting 20% share, with >50% of data center revenue eventually from custom.”
The Wall Street giant pointed out that Marvell “is firmly in the AI winner camp despite recent negative sentiment,” although it maintained their Equal-weight rating as it prefers peers on valuation grounds.
Both banks flagged that the company introduced two new XPU sockets and four new attach sockets tied to emerging hyperscaler customers. This brings Marvell’s total custom silicon wins to 18, spread across top-tier and emerging hyperscalers.
While the company reiterated existing projects with large players like Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN), analysts remain cautious about near-term revenue clarity.
Barclays commented that the event “did little to move the needle,” given the ongoing debate around Marvell’s share in Amazon’s Trainium 3 and its contribution from Microsoft beyond 2026.
Morgan Stanley analysts voiced similar thoughts, arguing that “the numbers almost seem too ambitious,” and added that investors may want to see more near-term execution before rewarding longer-term targets.
Still, the bank acknowledged the “breadth of new opportunities is impressive,” and noted the potential for a step-up in 2027 as many of the custom projects move into production.
Despite the cautious stance, Morgan Stanley expects Marvell stock to react positively to the event.
The chipmaker’s shares were up 1% in premarket trading Wednesday as of 09:23 GMT.
