(Bloomberg) — Marvell Technology Inc. jumped in late trading after the chipmaker delivered better-than-expected results and optimistic profit forecasts, citing demand for artificial intelligence.
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Third-quarter profit amounted to 43 cents per share, excluding some items, the company said in a statement on Tuesday. That was better than the average analyst estimate of 41 cents. On that basis, Marvell expects a profit of as much as 64 cents in the current period, well above the projection of 52 cents.
Chief Executive Officer Matt Murphy has positioned the chipmaker to benefit from an industry-wide boom in AI spending. While it hasn’t yet experienced the kind of sales surge that Nvidia Corp. the most valuable company in the world, Marvell offers AI accelerators and other components used by cloud computing providers to develop advanced services.
“The exceptional performance in the third quarter and our strong guidance for the fourth quarter are primarily due to our custom AI silicon programs, which are now in volume production,” Murphy said in the statement.
Shares rose nearly 11% to $106.35 in extended trading after the results were announced. They were up 59% this year through Tuesday’s close.
Marvell expects revenue of about $1.8 billion in the fourth quarter, which runs through January. That compares to a median estimate of $1.64 billion, according to data compiled by Bloomberg. Revenue rose 7% to $1.52 billion in the third quarter, ahead of the forecast of $1.45 billion.
Murphy, who became CEO in 2016, is now a potential candidate to take over Intel Corp. to lead. That company has approached the director as part of its search for a new leader following the ouster this week of Intel CEO Pat Gelsinger, Bloomberg News reported Tuesday.
Murphy said during a conference call that he was committed to his current company and said he couldn’t think of a better place to work. “I’m 100% focused on Marvell,” he said.
(Shares updated in fifth paragraph. An earlier version of the story has been corrected to clarify Marvell’s product offering.)
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