Why Marvell Jumped 251% in the First Half of the Year

Semiconductor stocks have skyrocketed this year, and Marvell Technologies (NASDAQ: MRVL) has been one of the biggest winners.

The fabless chipmaker, which designs custom ASIC chips and optical components, has benefited from the AI boom, strong results, and a prediction from Nvidia CEO Jensen Huang that it would become the "next trillion-dollar company."

According to data from S&P Global Market Intelligence, the stock jumped 251% over the first six months of the year. As you can see from the chart below, the stock didn't really start to gain until the second quarter, when the broader chip sector went parabolic in response to strong demand signals for AI components and a surge in investor sentiment. The jump in Marvell stock in early June was due to comments from Nvidia's Huang.

MRVL data by YCharts

What's behind Marvell's massive surge

The chart above illustrates that Marvell's gains were more about overall investor sentiment and forward expectations, rather than quarterly numbers. Nonetheless, the company delivered solid results with revenue for Q4 2026, which ended on Jan. 31, up 22% to $2.22 billion, and adjusted earnings per share increasing from $0.60 to $0.80.

The company also offered strong guidance for the first quarter, indicating that revenue growth was expected to reaccelerate. Several Wall Street analysts upgraded the stock on the news.

Marvell followed that up with accelerating growth in the first quarter, as revenue rose 28% to $2.42 billion, and adjusted earnings per share improved from $0.62 to $0.80. The stock again climbed on the news as Wall Street responded enthusiastically.

Marvell's biggest gain of the year came days later when the stock jumped 33% on Jensen Huang's endorsement. The Nvidia chief called Marvell the next trillion-dollar company at the Computex trade show in Taiwan, noting Marvell's prowess in data infrastructure and the growth of optical communications.

Finally, the stock popped on news in mid-June that it would be added to the S&P 500, replacing Pool Corporation.

Image source: Getty Images.

What's next for Marvell

The stock has pulled back in July, in line with a broader retreat in semiconductor stocks. After the first-half surge, the stock looks expensive by historical standards, trading at a price-to-sales ratio of 20.

However, Wall Street expects its growth rate to steadily accelerate over the next two years. The stock is likely to move with broader sentiment in the chip sector in the coming months, but if it can deliver on that growth forecast, the stock should be a winner over the longer term.

Jeremy Bowman has positions in Nvidia. The Motley Fool has positions in and recommends Marvell Technology, Nvidia, and Pool. The Motley Fool has a disclosure policy.