- Q3 Net Revenue: $1.419 billion,
declined by 8% year-on-year
- Q3 Gross Margin: 38.9% GAAP gross margin; 60.6% non-GAAP gross
margin
- Q3 Diluted income (loss) per share: $(0.19) GAAP diluted loss per share; $0.41 non-GAAP diluted income per share
SANTA
CLARA, Calif., Nov. 30,
2023 /PRNewswire/ -- Marvell Technology, Inc.
(NASDAQ: MRVL), a leader in data infrastructure semiconductor
solutions, today reported financial results for the third quarter
of fiscal year 2024.
Net revenue for the third quarter of fiscal 2024 was
$1.419 billion, $19 million
above the midpoint of the Company's guidance provided on
August 24, 2023. GAAP net loss for
the third quarter of fiscal 2024 was $(164.3) million, or $(0.19) per diluted share. Non-GAAP net income
for the third quarter of fiscal 2024 was $354.1 million, or $0.41 per diluted share. Cash flow from
operations for the third quarter was $503.0
million.
"Marvell delivered third quarter fiscal 2024 revenue of
$1.419 billion, growing 6%
sequentially, above the midpoint of guidance. Revenue from our
datacenter end market grew over 20% sequentially in the third
quarter, and we expect growth of over 30% sequentially in our
fourth quarter," said Matt Murphy,
Marvell's Chairman and CEO. "The diversification of our portfolio
is serving us well, with strong growth from AI and cloud carrying
us through a softening demand environment in other end markets.
These dynamics are reflected in our forecast for overall revenue to
be flat sequentially in the fourth quarter at the midpoint of
guidance."
Fourth Quarter of Fiscal 2024 Financial Outlook
- Net revenue is expected to be $1.420
billion +/- 5%.
- GAAP gross margin is expected to be 48.2% - 50.7%.
- Non-GAAP gross margin is expected to be 63.5% - 64.5%.
- GAAP operating expenses are expected to be approximately
$680 million.
- Non-GAAP operating expenses are expected to be approximately
$430 million.
- Basic weighted average shares outstanding are expected to be
865 million.
- Diluted weighted average shares outstanding are expected to be
874 million.
- GAAP diluted loss per share is expected to be $(0.03) +/- $0.05
per share.
- Non-GAAP diluted income per share is expected to be
$0.46 +/- $0.05 per share.
GAAP diluted EPS is calculated using basic weighted average
shares outstanding when there is a GAAP net loss, and calculated
using diluted weighted average shares outstanding when there is a
GAAP net income. Non-GAAP diluted EPS is calculated using diluted
weighted average shares outstanding.
Conference Call
Marvell will conduct a conference call on Thursday, November 30, 2023 at 1:45 p.m. Pacific Time to discuss results for the
third quarter of fiscal 2024. Interested parties may join the
conference call by dialing 1-888-317-6003 or 1-412-317-6061,
passcode 2559616. The call will be webcast and can be accessed at
the Marvell Investor Relations website at
http://investor.marvell.com/. A replay of the call can be accessed
by dialing 1-877-344-7529 or 1-412-317-0088, passcode 1858033 until
Thursday, December 7, 2023.
Discussion of Non-GAAP Financial Measures
Non-GAAP financial measures exclude the effect of stock-based
compensation expense, amortization of the inventory fair value
adjustment associated with acquisitions, amortization of acquired
intangible assets, acquisition and divestiture-related costs,
restructuring and other related charges (including, but not limited
to, asset impairment charges, employee severance costs, and
facilities related charges), resolution of legal matters, and
certain expenses and benefits that are driven primarily by discrete
events that management does not consider to be directly related to
Marvell's core business. Although Marvell excludes the amortization
of all acquired intangible assets from these non-GAAP financial
measures, management believes that it is important for investors to
understand that such intangible assets were recorded as part of
purchase price accounting arising from acquisitions, and that such
amortization of intangible assets that relate to past acquisitions
will recur in future periods until such intangible assets have been
fully amortized. Investors should note that the use of intangible
assets contributed to Marvell's revenues earned during the periods
presented and are expected to contribute to Marvell's future period
revenues as well.
Marvell uses a non-GAAP tax rate to compute the non-GAAP tax
provision. This non-GAAP tax rate is based on Marvell's estimated
annual GAAP income tax forecast, adjusted to account for items
excluded from Marvell's non-GAAP income, as well as the effects of
significant non-recurring and period specific tax items which vary
in size and frequency, and excludes tax deductions and benefits
from acquired tax loss and credit carryforwards and changes in
valuation allowance on acquired deferred tax assets. Marvell's
non-GAAP tax rate is determined on an annual basis and may be
adjusted during the year to take into account events that may
materially affect the non-GAAP tax rate such as tax law changes;
acquisitions; significant changes in Marvell's geographic mix of
revenue and expenses; or changes to Marvell's corporate structure.
For the third quarter of fiscal 2024, a non-GAAP tax rate of 6.0%
has been applied to the non-GAAP financial results.
Marvell believes that the presentation of non-GAAP financial
measures provides important supplemental information to management
and investors regarding financial and business trends relating to
Marvell's financial condition and results of operations. While
Marvell uses non-GAAP financial measures as a tool to enhance its
understanding of certain aspects of its financial performance,
Marvell does not consider these measures to be a substitute for, or
superior to, financial measures calculated in accordance with GAAP.
Consistent with this approach, Marvell believes that disclosing
non-GAAP financial measures to the readers of its financial
statements provides such readers with useful supplemental data
that, while not a substitute for GAAP financial measures, allows
for greater transparency in the review of its financial and
operational performance.
Externally, management believes that investors may find
Marvell's non-GAAP financial measures useful in their assessment of
Marvell's operating performance and the valuation of Marvell.
Internally, Marvell's non-GAAP financial measures are used in the
following areas:
- Management's evaluation of Marvell's operating
performance;
- Management's establishment of internal operating budgets;
- Management's performance comparisons with internal forecasts
and targeted business models; and
- Management's determination of the achievement and measurement
of certain performance-based equity awards (adjustments may vary
from award to award).
Non-GAAP financial measures have limitations in that they do not
reflect all of the costs associated with the operations of
Marvell's business as determined in accordance with GAAP. As a
result, you should not consider these measures in isolation or as a
substitute for analysis of Marvell's results as reported under
GAAP. The exclusion of the above items from our GAAP financial
metrics does not necessarily mean that these costs are unusual or
infrequent.
Forward-Looking Statements under the Private Securities
Litigation Reform Act of 1995
This press release contains forward-looking statements within
the meaning of the federal securities laws that involve risks and
uncertainties. Words such as "anticipates," "expects," "intends,"
"plans," "projects," "believes," "seeks," "estimates," "can,"
"may," "will," "would," "outlook," "forecast," "targets" and
similar expressions identify such forward-looking statements.
Forward-looking statements contained in this press release include,
but are not limited to, the statements describing our financial
outlook and future period revenues. These statements are not
guarantees of results and should not be considered as an indication
of future activity or future performance. Forward-looking
statements are predictions, projections and other statements about
future events that are based on current expectations and
assumptions and, as a result, are subject to risks and
uncertainties. Actual events or results may differ materially from
those described in this press release due to a number of risks and
uncertainties, including, but not limited to: risks related to
changes in general macroeconomic conditions, or expectations
of such conditions, such as rising interest rates, macroeconomic
slowdowns, recessions, inflation, and stagflation; risks related to
our ability to estimate customer demand and future sales
accurately; risks related to higher inventory levels; risks related
to cancellations, rescheduling or deferrals of significant customer
orders or shipments, as well as the ability of our customers to
manage inventory; the risk of downturns in the semiconductor
industry or our customer end markets; our ability to define,
design, develop and market products for the Cloud and 5G markets,
as well as for Artificial Intelligence (AI) solutions; the impact
of international conflict (such as the current armed conflicts in
the Ukraine and in Israel and the Gaza
Strip) and economic volatility in either domestic or foreign
markets including risks related to trade conflicts or tensions,
regulations, and tariffs, including but not limited to, trade
restrictions imposed on our Chinese customers; our ability to
retain and hire key personnel; our ability to limit costs related
to defective products; risks related to our debt obligations; risks
related to the rapid growth of the Company; delays or increased
costs related to completing the design, development, production and
introduction of our new products due to a variety of issues,
including supply chain cross-dependencies, dependencies on EDA and
similar tools, dependencies on the use of third party, business
partner or customer intellectual property, collaboration and
synchronization requirements with business partners and customers,
requirements to establish new manufacturing, testing, assembly and
packing processes, and other issues; our dependence on a small
number of customers; our reliance on our manufacturing partners for
the manufacture, assembly, testing and packaging of our products;
risks related to the ASIC business model which
requires us to use third-party IP including the risk that we may
lose business or experience reputational harm if third parties,
including customers, lose confidence in our ability to protect
their IP rights; the risks associated with manufacturing and
selling products and customers' products outside of the United States; our ability to secure
design wins from our customers and prospective customers; our
ability to complete and realize the anticipated benefits of any
acquisitions, divestitures and investments; decreases in gross
margin and results of operations in the future due to a number of
factors, including increasing interest rates and volatility in
foreign exchange rates; severe financial hardship or bankruptcy of
one or more of our major customers; our ability to realize the
expected benefits from restructuring activities; the effects of
transitioning to smaller geometry process technologies; risks
related to use of a hybrid work model; the impact of any change in
the income tax laws in jurisdictions where we operate and the loss
of any beneficial tax treatment that we currently enjoy; the
outcome of pending or future litigation and legal and regulatory
proceedings; risk related to our ESG program; the impact and costs
associated with changes in international financial and regulatory
conditions; our ability and the ability of our customers to
successfully compete in the markets in which we serve; our ability
and our customers' ability to develop new and enhanced products and
the adoption of those products in the market; risks related to the
impact of the COVID-19 pandemic (or future pandemics) which have
impacted, and for which lingering effects may continue to impact
our business, employees and operations, the transportation and
manufacturing of our products, and the operations of our customers,
distributors, vendors, suppliers, and partners; supply chain
disruptions or component shortages that may impact the production
of our products including our kitting process or may impact the
price of components which in turn may impact our margins on any
impacted products and any constrained availability from other
electronic suppliers impacting our customers' ability to ship their
products, which in turn may adversely impact our sales to those
customers; financial institution instability; our ability to scale
our operations in response to changes in demand for existing or new
products and services; risks associated with acquisition and
consolidation activity in the semiconductor industry, including any
consolidation of our manufacturing partners; our ability to protect
our intellectual property; our maintenance of an effective system
of internal controls; and other risks detailed in our SEC filings
from time to time. The foregoing list of factors is not exhaustive.
You should carefully consider the foregoing factors and the other
risks and uncertainties that affect our business described in the
"Risk Factors" section of our Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and other documents filed by us from
time to time with the SEC. Forward-looking statements speak only as
of the date they are made. Readers are cautioned not to put undue
reliance on forward-looking statements, and we assume no obligation
and do not intend to update or revise these forward-looking
statements, whether as a result of new information, future events
or otherwise.
About Marvell
To deliver the data infrastructure technology that connects the
world, we're building solutions on the most powerful foundation:
our partnerships with our customers. Trusted by the world's leading
technology companies for over 25 years, we move, store, process and
secure the world's data with semiconductor solutions designed for
our customers' current needs and future ambitions. Through a
process of deep collaboration and transparency, we're ultimately
changing the way tomorrow's enterprise, cloud, automotive, and
carrier architectures transform—for the better.
Marvell® and the Marvell logo
are registered trademarks of Marvell and/or its affiliates.
Marvell Technology,
Inc.
Condensed
Consolidated Statements of Operations (Unaudited)
(In millions, except
per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 28,
2023
|
|
July 29,
2023
|
|
October 29,
2022
|
|
October 28,
2023
|
|
October 29,
2022
|
Net revenue
|
|
$ 1,418.6
|
|
$ 1,340.9
|
|
$ 1,537.3
|
|
$ 4,081.2
|
|
$ 4,501.1
|
Cost of goods
sold
|
|
867.4
|
|
819.8
|
|
760.0
|
|
2,451.7
|
|
2,186.9
|
Gross
profit
|
|
551.2
|
|
521.1
|
|
777.3
|
|
1,629.5
|
|
2,314.2
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
481.1
|
|
474.8
|
|
448.1
|
|
1,436.6
|
|
1,341.2
|
Selling, general and
administrative
|
|
213.0
|
|
210.0
|
|
207.8
|
|
622.0
|
|
640.2
|
Legal settlement
(a)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
100.0
|
Restructuring related
charges
|
|
3.4
|
|
42.0
|
|
15.6
|
|
105.3
|
|
18.1
|
Total operating
expenses
|
|
697.5
|
|
726.8
|
|
671.5
|
|
2,163.9
|
|
2,099.5
|
Operating income
(loss)
|
|
(146.3)
|
|
(205.7)
|
|
105.8
|
|
(534.4)
|
|
214.7
|
Interest
income
|
|
1.7
|
|
1.6
|
|
1.5
|
|
5.8
|
|
2.8
|
Interest
expense
|
|
(52.6)
|
|
(53.8)
|
|
(45.2)
|
|
(159.1)
|
|
(121.3)
|
Other income,
net
|
|
9.7
|
|
6.3
|
|
3.2
|
|
16.3
|
|
12.1
|
Interest and other
loss, net
|
|
(41.2)
|
|
(45.9)
|
|
(40.5)
|
|
(137.0)
|
|
(106.4)
|
Income (loss) before
income taxes
|
|
(187.5)
|
|
(251.6)
|
|
65.3
|
|
(671.4)
|
|
108.3
|
Provision (benefit)
for income taxes
|
|
(23.2)
|
|
(44.1)
|
|
52.0
|
|
(130.7)
|
|
256.4
|
Net income
(loss)
|
|
$
(164.3)
|
|
$
(207.5)
|
|
$
13.3
|
|
$
(540.7)
|
|
$
(148.1)
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share — basic
|
|
$
(0.19)
|
|
$
(0.24)
|
|
$
0.02
|
|
$
(0.63)
|
|
$
(0.17)
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share — diluted
|
|
$
(0.19)
|
|
$
(0.24)
|
|
$
0.02
|
|
$
(0.63)
|
|
$
(0.17)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
862.6
|
|
860.9
|
|
852.6
|
|
860.1
|
|
850.5
|
Diluted
|
|
862.6
|
|
860.9
|
|
858.4
|
|
860.1
|
|
850.5
|
|
|
(a)
|
Relates to settlement
of a contractual dispute.
|
Marvell Technology,
Inc.
Condensed
Consolidated Balance Sheets (Unaudited)
(In
millions)
|
|
|
|
October 28,
2023
|
|
January 28,
2023
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
725.6
|
|
$
911.0
|
Accounts receivable,
net
|
|
1,214.6
|
|
1,192.2
|
Inventories
|
|
941.5
|
|
1,068.3
|
Prepaid expenses and
other current assets
|
|
91.5
|
|
109.6
|
Total current
assets
|
|
2,973.2
|
|
3,281.1
|
Property and
equipment, net
|
|
701.6
|
|
577.4
|
Goodwill
|
|
11,586.9
|
|
11,586.9
|
Acquired intangible
assets, net
|
|
4,290.4
|
|
5,102.0
|
Deferred tax
assets
|
|
759.5
|
|
465.9
|
Other non-current
assets
|
|
1,402.8
|
|
1,508.8
|
Total
assets
|
|
$
21,714.4
|
|
$
22,522.1
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
419.1
|
|
$
465.8
|
Accrued
liabilities
|
|
1,119.2
|
|
1,092.0
|
Accrued employee
compensation
|
|
245.0
|
|
244.5
|
Short-term
debt
|
|
96.3
|
|
584.4
|
Total current
liabilities
|
|
1,879.6
|
|
2,386.7
|
Long-term
debt
|
|
4,089.6
|
|
3,907.7
|
Other non-current
liabilities
|
|
511.8
|
|
590.5
|
Total
liabilities
|
|
6,481.0
|
|
6,884.9
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
Common
stock
|
|
1.7
|
|
1.7
|
Additional paid-in
capital
|
|
14,805.2
|
|
14,512.0
|
Accumulated other
comprehensive loss
|
|
(1.4)
|
|
—
|
Retained
earnings
|
|
427.9
|
|
1,123.5
|
Total stockholders'
equity
|
|
15,233.4
|
|
15,637.2
|
Total liabilities and
stockholders' equity
|
|
$
21,714.4
|
|
$
22,522.1
|
Marvell Technology,
Inc.
|
Condensed
Consolidated Statements of Cash Flows (Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 28,
2023
|
|
October 29,
2022
|
|
October 28,
2023
|
|
October 29,
2022
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
(164.3)
|
|
$
13.3
|
|
$
(540.7)
|
|
$
(148.1)
|
Adjustments to
reconcile net income (loss) to net cash provided by
operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
72.1
|
|
74.4
|
|
226.0
|
|
227.0
|
Stock-based
compensation
|
|
158.5
|
|
146.1
|
|
454.5
|
|
421.7
|
Amortization of
acquired intangible assets
|
|
269.8
|
|
269.9
|
|
811.6
|
|
814.2
|
Amortization of
inventory fair value adjustment associated with
acquisitions
|
|
—
|
|
10.4
|
|
—
|
|
26.0
|
Restructuring related
impairment charges
|
|
0.8
|
|
3.0
|
|
32.2
|
|
4.9
|
Deferred income
taxes
|
|
(57.0)
|
|
(124.8)
|
|
(283.7)
|
|
53.6
|
Other expense,
net
|
|
18.2
|
|
31.3
|
|
39.9
|
|
53.6
|
Changes in assets and
liabilities, net of acquisitions:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
(5.5)
|
|
(101.8)
|
|
(22.4)
|
|
(341.5)
|
Prepaid expenses and
other assets
|
|
53.7
|
|
(197.5)
|
|
14.4
|
|
(382.4)
|
Inventories
|
|
70.6
|
|
(56.3)
|
|
123.1
|
|
(263.4)
|
Accounts
payable
|
|
(0.7)
|
|
(37.8)
|
|
(87.5)
|
|
(33.9)
|
Accrued employee
compensation
|
|
59.7
|
|
60.0
|
|
0.7
|
|
6.3
|
Accrued liabilities
and other non-current liabilities
|
|
27.1
|
|
320.8
|
|
55.8
|
|
499.3
|
Net cash provided by
operating activities
|
|
503.0
|
|
411.0
|
|
823.9
|
|
937.3
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Purchases of
technology licenses
|
|
(0.3)
|
|
(4.9)
|
|
(3.3)
|
|
(9.1)
|
Purchases of property
and equipment
|
|
(54.4)
|
|
(42.7)
|
|
(265.3)
|
|
(152.2)
|
Acquisitions, net of
cash acquired
|
|
—
|
|
(4.4)
|
|
(5.5)
|
|
(103.0)
|
Other, net
|
|
0.1
|
|
0.1
|
|
(0.2)
|
|
0.1
|
Net cash used in
investing activities
|
|
(54.6)
|
|
(51.9)
|
|
(274.3)
|
|
(264.2)
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Repurchases of common
stock
|
|
(50.0)
|
|
(50.0)
|
|
(50.0)
|
|
(115.0)
|
Proceeds from employee
stock plans
|
|
0.7
|
|
1.1
|
|
61.1
|
|
52.5
|
Tax withholding paid
on behalf of employees for net share settlement
|
|
(44.9)
|
|
(29.5)
|
|
(168.7)
|
|
(201.2)
|
Dividend payments to
stockholders
|
|
(51.8)
|
|
(51.1)
|
|
(154.9)
|
|
(153.1)
|
Payments on technology
license obligations
|
|
(31.6)
|
|
(32.4)
|
|
(110.2)
|
|
(103.6)
|
Proceeds from
borrowings
|
|
1,045.3
|
|
—
|
|
1,295.3
|
|
200.0
|
Principal payments of
debt
|
|
(1,006.9)
|
|
(91.9)
|
|
(1,600.6)
|
|
(243.8)
|
Payment of equity and
debt financing costs
|
|
(7.0)
|
|
—
|
|
(7.0)
|
|
—
|
Other, net
|
|
—
|
|
1.0
|
|
—
|
|
1.0
|
Net cash used in
financing activities
|
|
(146.2)
|
|
(252.8)
|
|
(735.0)
|
|
(563.2)
|
Net increase
(decrease) in cash and cash equivalents
|
|
302.2
|
|
106.3
|
|
(185.4)
|
|
109.9
|
Cash and cash
equivalents at beginning of period
|
|
423.4
|
|
617.1
|
|
911.0
|
|
613.5
|
Cash and cash
equivalents at end of period
|
|
$
725.6
|
|
$
723.4
|
|
$
725.6
|
|
$
723.4
|
Marvell Technology,
Inc.
|
Reconciliations from
GAAP to Non-GAAP (Unaudited)
|
(In millions, except
per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 28,
2023
|
|
July 29,
2023
|
|
October 29,
2022
|
|
October 28,
2023
|
|
October 29,
2022
|
GAAP gross
profit
|
|
$ 551.2
|
|
$ 521.1
|
|
$ 777.3
|
|
$
1,629.5
|
|
$
2,314.2
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
|
15.7
|
|
11.0
|
|
12.1
|
|
38.7
|
|
33.8
|
Amortization of
acquired intangible assets
|
|
184.3
|
|
185.8
|
|
181.9
|
|
553.8
|
|
540.2
|
Other cost of goods
sold (a)
|
|
108.0
|
|
90.2
|
|
13.0
|
|
237.8
|
|
28.6
|
Total special
items
|
|
308.0
|
|
287.0
|
|
207.0
|
|
830.3
|
|
602.6
|
Non-GAAP gross
profit
|
|
$ 859.2
|
|
$ 808.1
|
|
$ 984.3
|
|
$
2,459.8
|
|
$
2,916.8
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
margin
|
|
38.9 %
|
|
38.9 %
|
|
50.6 %
|
|
39.9 %
|
|
51.4 %
|
Non-GAAP gross
margin
|
|
60.6 %
|
|
60.3 %
|
|
64.0 %
|
|
60.3 %
|
|
64.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total GAAP operating
expenses
|
|
$ 697.5
|
|
$ 726.8
|
|
$ 671.5
|
|
$
2,163.9
|
|
$
2,099.5
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
|
(142.8)
|
|
(141.8)
|
|
(134.0)
|
|
(415.8)
|
|
(387.9)
|
Restructuring related
charges (b)
|
|
(3.4)
|
|
(42.0)
|
|
(15.6)
|
|
(105.3)
|
|
(18.1)
|
Amortization of
acquired intangible assets
|
|
(85.5)
|
|
(86.0)
|
|
(88.0)
|
|
(257.8)
|
|
(274.0)
|
Legal settlement
(c)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(100.0)
|
Other (d)
|
|
(28.7)
|
|
(9.0)
|
|
(13.5)
|
|
(41.3)
|
|
(32.2)
|
Total special
items
|
|
(260.4)
|
|
(278.8)
|
|
(251.1)
|
|
(820.2)
|
|
(812.2)
|
Total non-GAAP
operating expenses
|
|
$ 437.1
|
|
$ 448.0
|
|
$ 420.4
|
|
$
1,343.7
|
|
$
1,287.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
margin
|
|
(10.3) %
|
|
(15.3) %
|
|
6.9 %
|
|
(13.1) %
|
|
4.8 %
|
Other cost of goods
sold (a)
|
|
7.6 %
|
|
6.7 %
|
|
0.8 %
|
|
5.8 %
|
|
0.6 %
|
Stock-based
compensation
|
|
11.2 %
|
|
11.4 %
|
|
9.5 %
|
|
11.1 %
|
|
9.4 %
|
Restructuring related
charges (b)
|
|
0.2 %
|
|
3.1 %
|
|
1.0 %
|
|
2.6 %
|
|
0.4 %
|
Amortization of
acquired intangible assets
|
|
19.0 %
|
|
20.3 %
|
|
17.6 %
|
|
19.9 %
|
|
18.1 %
|
Legal settlement
(c)
|
|
— %
|
|
— %
|
|
— %
|
|
— %
|
|
2.2 %
|
Other (d)
|
|
2.1 %
|
|
0.7 %
|
|
0.9 %
|
|
1.0 %
|
|
0.7 %
|
Non-GAAP operating
margin
|
|
29.8 %
|
|
26.9 %
|
|
36.7 %
|
|
27.3 %
|
|
36.2 %
|
|
|
|
|
|
|
|
|
|
|
|
GAAP interest and
other loss, net
|
|
$ (41.2)
|
|
$ (45.9)
|
|
$ (40.5)
|
|
$
(137.0)
|
|
$
(106.4)
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
Other (d)
|
|
(4.2)
|
|
(8.5)
|
|
(0.5)
|
|
(12.6)
|
|
(6.2)
|
Total special
items
|
|
(4.2)
|
|
(8.5)
|
|
(0.5)
|
|
(12.6)
|
|
(6.2)
|
Total non-GAAP
interest and other loss, net
|
|
$ (45.4)
|
|
$ (54.4)
|
|
$ (41.0)
|
|
$
(149.6)
|
|
$
(112.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
$
(164.3)
|
|
$
(207.5)
|
|
$
13.3
|
|
$
(540.7)
|
|
$
(148.1)
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
Other cost of goods
sold (a)
|
|
108.0
|
|
90.2
|
|
13.0
|
|
237.8
|
|
28.6
|
Stock-based
compensation
|
|
158.5
|
|
152.8
|
|
146.1
|
|
454.5
|
|
421.7
|
Restructuring related
charges (b)
|
|
3.4
|
|
42.0
|
|
15.6
|
|
105.3
|
|
18.1
|
Amortization of
acquired intangible assets
|
|
269.8
|
|
271.8
|
|
269.9
|
|
811.6
|
|
814.2
|
Legal settlement
(c)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
100.0
|
Other (d)
|
|
24.5
|
|
0.5
|
|
13.0
|
|
28.7
|
|
26.0
|
Pre-tax total special
items
|
|
564.2
|
|
557.3
|
|
457.6
|
|
1,637.9
|
|
1,408.6
|
Other income tax
effects and adjustments (e)
|
|
(45.8)
|
|
(59.6)
|
|
20.6
|
|
(188.7)
|
|
165.4
|
Non-GAAP net
income
|
|
$ 354.1
|
|
$ 290.2
|
|
$ 491.5
|
|
$ 908.5
|
|
$
1,425.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP weighted average
shares — basic
|
|
862.6
|
|
860.9
|
|
852.6
|
|
860.1
|
|
850.5
|
GAAP weighted average
shares — diluted
|
|
862.6
|
|
860.9
|
|
858.4
|
|
860.1
|
|
850.5
|
Non-GAAP weighted
average shares — diluted (f)
|
|
872.2
|
|
869.4
|
|
858.4
|
|
867.6
|
|
859.3
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net
income (loss) per share
|
|
$ (0.19)
|
|
$ (0.24)
|
|
$
0.02
|
|
$ (0.63)
|
|
$ (0.17)
|
Non-GAAP diluted net
income per share
|
|
$
0.41
|
|
$
0.33
|
|
$
0.57
|
|
$
1.05
|
|
$
1.66
|
|
|
(a)
|
Other cost of goods
sold includes charges for product claim related matters,
acquisition integration related inventory costs, and amortization
of acquired inventory fair value adjustments.
|
|
|
(b)
|
Restructuring and other
related items include employee severance costs, asset impairment
charges, facilities related charges, and other.
|
|
|
(c)
|
Relates to settlement
of a contractual dispute.
|
|
|
(d)
|
Other costs included in
operating expenses and other income, net include charges for an
intellectual property matter, net gains on investments, and
acquisition related costs.
|
|
|
(e)
|
Other income tax
effects and adjustments relate to tax provision based on a non-GAAP
income tax rate of 6% for the three and nine months ended October
28, 2023. Other income tax effects and adjustments are based on a
non-GAAP income tax rate of 5.1% for the three months ended
July 29, 2023. Other income tax effects and adjustments relate
to tax provision based on a non-GAAP income tax rate of 6.0% for
the three and nine months ended October 29, 2022. In the nine
months ended October 29, 2022, $213.6 million of non-recurring
income tax expense associated with the extension of a tax incentive
in Singapore was excluded from our non-GAAP income tax
expense.
|
|
|
(f)
|
Non-GAAP diluted
weighted average shares differs from GAAP diluted weighted average
shares due to the non-GAAP net income reported.
|
Marvell
Technology, Inc.
|
Outlook for
the Fourth Quarter of Fiscal Year 2024
|
Reconciliations from
GAAP to Non-GAAP (Unaudited)
|
(In millions,
except per share amounts)
|
|
|
|
|
|
Outlook for Three
Months Ended
February 3,
2024
|
GAAP net
revenue
|
$1,420 +/-
5%
|
Special
items:
|
—
|
Non-GAAP net
revenue
|
$1,420 +/-
5%
|
|
|
GAAP gross
margin
|
48.2% -
50.7%
|
Special
items:
|
|
Stock-based
compensation
|
0.7 %
|
Amortization of
acquired intangible assets
|
13.8 %
|
Non-GAAP gross
margin
|
63.5% -
64.5%
|
|
|
Total GAAP
operating expenses
|
~$680
|
Special
items:
|
|
Stock-based
compensation
|
153
|
Amortization of
acquired intangible assets
|
92
|
Restructuring related
charges
|
5
|
Total non-GAAP
operating expenses
|
~$430
|
|
|
|
|
GAAP diluted loss
per share
|
$(0.03) +/-
$0.05
|
Special
items:
|
|
Stock-based
compensation
|
0.19
|
Amortization of
acquired intangible assets
|
0.33
|
Other income tax
effects and adjustments
|
(0.03)
|
Non-GAAP diluted net
income per share
|
$0.46 +/-
$0.05
|
Quarterly Revenue Trend (Unaudited)
Our product solutions serve five large end markets where our
technology is essential: (i) data center, (ii) enterprise
networking, (iii) carrier infrastructure, (iv) consumer, and (v)
automotive/industrial. These markets and their corresponding
customer products and applications are noted in the table
below:
End
market
|
Customer products
and applications
|
Data center
|
•
Cloud and on-premise Artificial
intelligence (AI) systems
•
Cloud and on-premise ethernet
switching
•
Cloud and on-premise network-attached
storage (NAS)
•
Cloud and on-premise servers
•
Cloud and on-premise storage area
networks
•
Cloud and on-premise storage
systems
•
Data center interconnect (DCI)
|
Enterprise
networking
|
•
Campus and small medium enterprise
routers
•
Campus and small medium enterprise
ethernet switches
•
Campus and small medium enterprise
wireless access points (WAPs)
•
Network appliances (firewalls, and load
balancers)
•
Workstations
|
Carrier
infrastructure
|
•
Broadband access systems
•
Ethernet switches
•
Optical transport systems
•
Routers
•
Wireless radio access network (RAN)
systems
|
Consumer
|
•
Broadband gateways and routers
•
Gaming consoles
•
Home data storage
•
Home wireless access points
(WAPs)
•
Personal Computers (PCs)
•
Printers
•
Set-top boxes
|
Automotive/industrial
|
•
Advanced driver-assistance systems
(ADAS)
•
Autonomous vehicles (AV)
•
In-vehicle networking
•
Industrial ethernet switches
•
United States military and government
solutions
•
Video surveillance
|
Quarterly Revenue
Trend (Unaudited) (Continued)
|
|
|
Three Months
Ended
|
|
%
Change
|
Revenue by End
Market
(In
millions)
|
October 28,
2023
|
|
July 29,
2023
|
|
October 29,
2022
|
|
YoY
|
|
QoQ
|
Data center
|
$
555.8
|
|
$
459.8
|
|
$
627.3
|
|
(11) %
|
|
21 %
|
Enterprise
networking
|
271.1
|
|
327.7
|
|
376.0
|
|
(28) %
|
|
(17) %
|
Carrier
infrastructure
|
316.5
|
|
275.5
|
|
271.4
|
|
17 %
|
|
15 %
|
Consumer
|
168.7
|
|
167.7
|
|
178.4
|
|
(5) %
|
|
1 %
|
Automotive/industrial
|
106.5
|
|
110.2
|
|
84.2
|
|
26 %
|
|
(3) %
|
Total Net
Revenue
|
$
1,418.6
|
|
$
1,340.9
|
|
$
1,537.3
|
|
(8) %
|
|
6 %
|
|
|
|
|
|
Three Months
Ended
|
Revenue by End
Market
% of
Total
|
|
|
|
|
October 28,
2023
|
|
July 29,
2023
|
|
October 29,
2022
|
Data center
|
|
|
|
|
39 %
|
|
34 %
|
|
41 %
|
Enterprise
networking
|
|
|
|
|
19 %
|
|
24 %
|
|
24 %
|
Carrier
infrastructure
|
|
|
|
|
22 %
|
|
21 %
|
|
18 %
|
Consumer
|
|
|
|
|
12 %
|
|
13 %
|
|
12 %
|
Automotive/industrial
|
|
|
|
|
8 %
|
|
8 %
|
|
5 %
|
Total Net
Revenue
|
|
|
|
|
100 %
|
|
100 %
|
|
100 %
|
For further information, contact:
Ashish Saran
Senior Vice President, Investor Relations
408-222-0777
ir@marvell.com
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SOURCE Marvell