Marvell Technology's Macro, Inflation Headwinds Prompt 5% Price Target Cut By Citi

Citi analysts Atif Malik and Amanda Scarnati reiterated a Buy on Marvell Technology, Inc MRVL but reduced the price target from $78 to $74.
Marvell reported Q2 EPS of $0.57, beating the consensus of $0.56. The revenue of $1.517 billion, up 41% Y/Y, missed the consensus of $1.520 billion.
MRVL stock was down 3% after posting a 1% July quarter EPS beat and guiding October quarter 2% below Street.
Data Center sales were flat versus up LSD expectations and guided down 5% Q/Q with the January quarter up Q/Q.
The advanced multi-package supply availability impacted the data center sales.
An upside offset data center sales in enterprise networking due to an improved supply of simple packages.
Marvell has not seen any demand-related data center weakness similar to the comments of data center peers Nvidia Corp NVDA/Advanced Micro Devices, Inc AMD.
MRVL reiterated $400 million/$800 million of incremental data center sales in the next two years from new design wins.
He cut his CY23 EPS by 5% and CY24 EPS by 7% and trimmed the price target to reflect slower macro and higher inflation-adjusted operating expenditure.
He continues to view MRVL as a multi-year data center growth story.
Price Action: MRVL shares traded lower by 1.79% at $49.27 on the last check Monday.
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