Nvidia's Jensen Huang Just Gave Marvell Technology a Huge Boost

Nvidia (NASDAQ:NVDA) CEO Jensen Huang isn’t afraid to make bold statements, and his bravado and vision have served the company well. Nvidia has become the largest publicly traded company in the world by market cap, with a valuation exceeding $5 trillion.

Obviously, Huang knows what it takes to get a company to the $1 trillion mark, and now he’s identified a fellow chipmaker with a market cap of less than $200 billion to hit that mark.

Here’s what he said about Marvell Technology (NASDAQ:MRVL).

Image source: The Motley Fool.

‘The next trillion-dollar company’

Huang gave Marvell his endorsement on Tuesday at the Computex trade show in Taipei, as he joined Marvell CEO Matthew Murphy on stage. “The next trillion-dollar company, ladies and gentlemen,” Huang said.

At the time, Marvell had a market cap of $191 billion, but Huang’s bold comment had an immediate impact. At the time of this writing, Marvell stock was up 27% in morning trading, and the company’s market cap has jumped to $234 billion.

Marvell is known for its high-performance semiconductor products, including data center switches that can route large volumes of traffic. Huang told the audience in Taipei that Marvell’s products are essential as computing tasks are spread across thousands of chips in data centers. “That’s the reason why Matt’s doing so well. That’s the reason why Marvell is so essential,” Huang said.

Huang’s interest in Marvell is more than just as a spectator. In March, Nvidia announced plans to invest $2 billion in Marvell and to deepen its partnership with the company to develop silicon photonics and other AI-centric telecommunications infrastructure hardware. Marvell stock jumped 13% the day that news broke, but Huang’s statement at the Computex trade show is carrying even more weight with investors.

Marvell’s path to $1 trillion

Obviously, Marvell isn’t going to get to $1 trillion overnight. Only 14 companies are currently at that level, and Eli Lilly and Walmart have previously topped $1 trillion before falling back. Marvell’s massive move today puts it at No. 73 on the ranking of companies by market cap, moving 43 spots higher in just a matter of hours.

But at this writing, it would still need to gain another 327% to reach $1 trillion. That won’t be easy to do. It even took Nvidia a long time. Huang’s company had a market cap of $323 billion at the beginning of 2020, but it didn’t achieve $1 trillion until May 30, 2023, more than three years later.

Investors have plenty of reasons to be bullish, however. Marvell’s earnings report for the fiscal first quarter of 2027 (ending May 2) showed revenue of $2.418 billion, up 28% from a year ago and $18 million above the midpoint of the company’s guidance.

“We expect revenue growth to continue accelerating each quarter throughout fiscal 2027, driven by continued strength in our data center business,” Murphy said at the time. He called the company’s AI-related bookings “exceptional,” and the company issued Q2 guidance of $2.7 billion in revenue and earnings per share in the range of $0.87 and $0.98.

Will Marvell really be the next trillion-dollar company? Probably not. My bet for that is Advanced Micro Devices, which currently has a market cap of more than $800 billion. AMD is the largest company yet to reach $1 trillion, but its stock is up 136% this year and appears poised to keep rising.

But Marvell is undoubtedly on the move, and its networking solutions are essential to helping data centers manage their workloads and enable AI. When you factor in the explosive growth in the data center space, which is expected to double the global capacity in the next four years, investors have plenty of reasons to believe that Marvell can eventually hit Huang’s milestone.

Patrick Sanders has positions in Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Eli Lilly, Marvell Technology, Nvidia, and Walmart. The Motley Fool has a disclosure policy.