by Vlad Kozlov
Marvell’s Analyst Day was held on December 6, 2022 in Santa Clara at the company’s headquarters. It was very upbeat and well attended by many financial analysts and all the industry analysts.
It was a celebration of the company’s achievements. Marvell is expecting to reach $6 billion in revenue in 2022 – doubling from 2020, despite a decline in data-center revenues expected in the current quarter. Not all of that revenue growth was organic, as Marvell acquired Inphi for $10 billion in 2020 (closed in April 2021) and Innovium later on in 2021 in an all-stock transaction, valued at above $1 billion.
These acquisitions propelled Marvell to a leadership position in the datacenter market segment – the largest part of the company’s business now, as Illustrated in Figure 1. Marvell also benefits from increasing sales of OCTEON processors and custom ASIC such as Nokia’s ReefShark for 5G wireless systems, which are included in the Carrier Infrastructure segment, and Multigigabit Ethernet contributing to the Enterprise Networks segment. Ethernet PHY for automotive and industrial applications is the smallest, but the fastest growing part of Marvell’s business.
Matthew J. Murphy, appointed as the company president and CEO in 2016, deserves a great deal of credit for getting the company to where it is today. He transformed the company into the rapidly growing and highly focused company we now see. A key area of attention under Matt’s tenure as CEO has been focus on high growth markets, on having leading edge technology and on being first to market with new products.
Marvell works very closely with TSMC and it participated in the pilot production runs for 5nm and 3nm CMOS. The company chose to skip the 7nm generation of chip production to focus on 5nm, instead and leapfrog the competition.
CEO Matt Murphy joined the analyst event late in the day because he attended TSMC’s first US fab’s grand opening in Phoenix AZ along with US President Joe Biden, Apple CEO Tim Cook and other significant industry leaders, which was also held on December 6, 2022. The first US based TSMC foundry being opened is just the right size to serve Marvell, but too small to make everything required by Apple. A second TSMC fab in the US that will support the latest 3nm production is already being planned.
In the last few years Marvell has made very heavy investments in its integrated circuit design and design verification capabilities. Now it has both the physical infrastructure and the rigorous process necessary for developing chips, especially chips for digital signal processing (DSPs). The company developed a single IC platform and processes capable of supporting multiple markets.
This moat around their castle poses a challenge and a barrier to successful market entry for competitors like Coherent which is entering the 100G low power DSP market and Lumentum which acquired an ASIC business from IPG Photonics. (IPG Photonics announced but never demonstrated a coherent DSP 3-4 years ago.) It takes a lot of know how to stay on the leading edge: Advanced verification tools: system modeling, emulation, formal performance verification, hybrid emulation. Getting wafer yields to acceptable levels requires a lot of skill.
Marvell announced an 800G PAM4 DSP based on 5nm CMOS during the analyst day. It also launched a 5nm secure 1.6T Ethernet PHY for the DC Cloud and 5G markets.
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