Not Nvidia. Not Micron. This Under-the-Radar Artificial Intelligence (AI) Chip Stock Could Be the Biggest Winner in 2027.

Source Motley_fool

Key Points

  • Many semiconductor stocks have become multibaggers thanks to AI-driven growth.

  • Nvidia and Micron dominate areas such as chip design and advanced memory solutions.

  • Custom silicon and high-speed connectivity are emerging as two critical areas of AI infrastructure.

  • 10 stocks we like better than Marvell Technology ›

Nvidia (NASDAQ: NVDA) and Micron Technology (NASDAQ: MU) are two of the stock market's biggest artificial intelligence (AI) success stories. Nvidia dominates AI accelerators, while Micron is benefiting from extraordinary demand for memory chips. Both companies have delivered remarkable growth, rewarding investors who recognized their opportunities early.

But as Wall Street looks toward 2027, another semiconductor stock could be preparing for its breakout moment. Marvell Technology (NASDAQ: MRVL) has already rallied on enthusiasm surrounding custom AI chips and advanced networking.

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However, the company's latest investor day projections, a lucrative partnership with Nvidia, and an expanding relationship with Alphabet suggest something more substantial than hype. As investors look beyond the obvious AI winners, Marvell could attract considerably more attention.

Server racks inside an AI data center.

Image source: Getty Images.

Marvell covers two enormous AI markets

Marvell isn't trying to replace Nvidia's GPUs or compete with Micron's memory solutions. Instead, the company focuses on two increasingly important components of AI infrastructure: custom silicon and high-speed connectivity.

Custom accelerators allow hyperscalers to design processors specifically optimized for certain workloads. Meanwhile, optical networking and interconnect technologies help move enormous quantities of data between chips, servers, and data centers.

During its recent investor day conference, Marvell estimated its total addressable market (TAM) could approach $400 billion by calendar 2030. Management outlined approximately $37 billion in interconnect revenue and roughly $30 billion from custom silicon by fiscal year 2031. This forecast reflects expectations for annualized growth of approximately 65% and 80%, respectively, across the two businesses.

Nvidia and Google endorsed Marvell

Back in March, Nvidia invested $2 billion in Marvell. The deal helped establish a strategic partnership focused on connecting custom AI processors with Nvidia's computing and networking ecosystem. The relationship focuses on NVLink Fusion, which allows AI developers to integrate specialized processors into Nvidia-based racks.

This is important because it positions Marvell as a beneficiary of the broader data center build-out rather than simply a competitor to Nvidia. Nvidia CEO Jensen Huang's willingness to invest in Marvell provides a meaningful endorsement of its technology.

In addition, Marvell's expanding relationship with Alphabet involves developing custom silicon supporting Google Cloud's AI infrastructure, including chips that complement its Tensor Processing Unit (TPU) ecosystem.

Specifically, Google received warrants tied to as much as $120 billion in potential chip purchases through fiscal 2033. While this isn't guaranteed revenue, it still illustrates the enormous scale of the relationship and the importance of Marvell's position in the AI chip value chain.

Why 2027 could be Marvell's breakout year

For years, memory and storage were viewed as commodity products. For this reason, memory stocks have had to fend off a narrative that they operate in cyclical markets. As AI infrastructure spending continues accelerating, investors are starting to realize that GPUs were only part of the equation. Memory and storage are now essential bottlenecks, sending shares of companies like Micron and Sandisk soaring.

Marvell could experience a similar shift in investor perception in 2027. The reason boils down to how AI spending is evolving. Hyperscalers aren't simply procuring more GPUs. They're building increasingly complex accelerated computing systems that require faster networking, greater bandwidth, and specialized processors designed for particular workloads.

As generative models become more sophisticated and inference deployments expand into new applications, efficiently moving data between processors becomes increasingly important. This is precisely where Marvell's optical networking, interconnect technologies, and custom silicon expertise converge.

Unlike some semiconductor companies waiting for future design wins, Marvell already has major customer programs underway. To get a grasp of how these relationships are impacting Marvell, consider that the company raised its fiscal 2028 revenue target from $18 billion to $20 billion. Importantly, Marvell's fiscal 2028 begins in early 2027 and ends in January 2028 -- meaning the majority of this projected growth will unfold during calendar 2027. Looking even further ahead, management expects total revenue of $70 billion to $90 billion in fiscal 2031. At the midpoint, that's nearly 10 times what Marvell generated during fiscal 2026.

This growth trajectory is why 2027 could represent the inflection point for Marvell. Nvidia has already established itself as the dominant platform for AI factories. Meanwhile, Micron continues to demonstrate the importance of high bandwidth memory and advanced DRAM. Marvell is approaching a period where its own revenue growth could make the importance of connectivity and custom silicon impossible to overlook. For growth investors looking for the next AI semiconductor breakout story, I consider Marvell stock an attractive long-term buy.

Should you buy stock in Marvell Technology right now?

Before you buy stock in Marvell Technology, consider this:

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Adam Spatacco has positions in Alphabet and Nvidia. The Motley Fool has positions in and recommends Alphabet, Marvell Technology, Micron Technology, and Nvidia. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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