Marvell wins new AI chip business, but at lower margins
April 11, 2024 at 12:41 pm EDT
Share
April 11 (Reuters) - Marvell Technology on
Thursday said it has won new business helping large U.S.-based
cloud computing firms make custom chips for artificial
intelligence but that its custom unit carries lower margins than
other lines of business.
Shares fell 2.7% after Marvell executives discussed the
business during an investor presentation. Marvell helps
customers such as Amazon.com design custom chips for
their cloud units and competes against rivals such as Alphabet
Inc supplier Broadcomm in that business.
(Reporting by Stephen Nellis in San Francisco and Arsheeya
Singh in Bengaluru)
Marvell Technology Group Ltd specializes in designing and marketing integrated communications and storage circuits intended for manufacturers of high-speed network equipment, hard disks, and consumer electronics. Net sales break down by area of application as follows:
- data centers (40.7%): artificial intelligence systems, data storage systems, Ethernet switches, servers, interconnection systems, etc.;
- enterprise networks (23.1%): routers, Ethernet switches, wireless access points, network equipment, workstations, etc. for campuses, small and medium-sized enterprises;
- telecom network infrastructures (18.3%): access multiplexers, Ethernet switches, optical transport systems, routers, wireless radio network access systems, etc.;
- consumer electronics (11.9%): broadband gateways and routers, game console systems, home data storage systems, home wireless access points, personal computer systems, printers and receiver terminals;
- automotive and industrial (6%): advanced driver assistance systems, autonomous vehicle systems, embedded network systems, industrial Ethernet switches, video surveillance systems.
Net sales are distributed geographically as follows: the United States (11.7%), China (42%), Malaysia (6.6%), Thailand (6.6%), Singapore (5.6%), Taiwan (4.9%), Japan (4.4%), Finland (3.2%), Philippines (2.9%) and other (12.1%).
MARVELL TECHNOLOGY GROUP LTD 
