- Q3 Net Revenue: $1.211 billion, grew by 61% year-on-yearSANTA CLARA, Calif., Dec. 2, 2021 — (PRNewswire) — Marvell Technology, Inc. (NASDAQ: MRVL), a leader in infrastructure semiconductor solutions, today reported financial results for the third quarter of fiscal year 2022.
Marvell completed the acquisition of Innovium, Inc. ("Innovium") on October 5, 2021 (the "acquisition date"), approximately 25 days before the end of the third quarter of fiscal year 2022. Marvell's results for the third quarter of fiscal 2022 include the results of Innovium from the acquisition date, while prior periods presented do not.
Net revenue for the third quarter of fiscal 2022 was $1.211 billion, which exceeded the midpoint of the Company's guidance provided on August 26, 2021. GAAP net loss for the third quarter of fiscal 2022 was $(63) million, or $(0.08) per diluted share. Non-GAAP net income for the third quarter of fiscal 2022 was $364 million, or $0.43 per diluted share. Cash flow from operations for the third quarter was $265 million.
"Marvell delivered record revenue of $1.211 billion in the fiscal third quarter, growing 13 percent sequentially and 61 percent year over year, exceeding the high end of our guidance. Revenue grew substantially in each of our five end markets, led by data center, our largest contributor at 41 percent of total revenue, which grew 15 percent sequentially and 109 percent year over year," said Matt Murphy, Marvell's President and CEO. "For the fourth quarter, we are expecting sequential revenue growth of 9 percent at the midpoint of guidance, led by 5G, which is projected to increase by 30 percent sequentially and data center which is forecasted to continue to grow in the double digits on a percentage basis."
The financial outlook for the fourth quarter of fiscal 2022 includes expected results of Innovium for the full quarter.
Fourth Quarter of Fiscal 2022 Financial Outlook
- Net revenue is expected to be $1.320 billion +/- 3%.
- GAAP gross margin is expected to be 47.9% to 49.8%.
- Non-GAAP gross margin is expected to be approximately 65%.
- GAAP operating expenses are expected to be $630 million to $640 million.
- Non-GAAP operating expenses are expected to be $390 million to $395 million.
- Basic weighted average shares outstanding are expected to be 844 million.
- Diluted weighted average shares outstanding are expected to be 861 million.
- GAAP diluted loss per share is expected to be $(0.03) +/- $0.04 per share.
- Non-GAAP diluted income per share is expected to be $0.48 +/- $0.03 per share.
GAAP diluted EPS is calculated using basic weighted average shares outstanding when there is a GAAP net loss, and calculated using diluted weighted average shares outstanding when there is a GAAP net income. Non-GAAP diluted EPS is calculated using diluted weighted average shares outstanding.
Marvell will conduct a conference call on Thursday, December 2, 2021 at 1:45 p.m. Pacific Time to discuss results for the third quarter of fiscal 2022. Interested parties may join the conference call by dialing 1-888-317-6003 or 1-412-317-6061, passcode 8563448. The call will be webcast and can be accessed at the Marvell Investor Relations website at http://investor.marvell.com/. A replay of the call can be accessed by dialing 1-877-344-7529 or 1-412-317-0088, passcode 10161867 until Thursday, December 9, 2021.
Discussion of Non-GAAP Financial Measures
Non-GAAP financial measures exclude the effect of share-based compensation expense, amortization of the inventory fair value adjustment associated with acquisition, amortization of acquired intangible assets, acquisition and divestiture-related costs, restructuring and other related charges (including, but not limited to, asset impairment charges, employee severance costs, and facilities related charges), resolution of legal matters, and certain expenses and benefits that are driven primarily by discrete events that management does not consider to be directly related to Marvell's core business.
Marvell uses a non-GAAP tax rate to compute the non-GAAP tax provision. This non-GAAP tax rate is based on Marvell's estimated annual GAAP income tax forecast, adjusted to account for items excluded from GAAP income in calculating Marvell's non-GAAP income, as well as the effects of significant non-recurring and period specific tax items which vary in size and frequency. Marvell's non-GAAP tax rate is determined on an annual basis and may be adjusted during the year to take into account events that may materially affect the non-GAAP tax rate such as tax law changes; significant changes in Marvell's geographic mix of revenue and expenses; or changes to Marvell's corporate structure. For the third quarter of fiscal 2022, a non-GAAP tax rate of 5.0% has been applied to the non-GAAP financial results.
Marvell believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Marvell's financial condition and results of operations. While Marvell uses non-GAAP financial measures as a tool to enhance its understanding of certain aspects of its financial performance, Marvell does not consider these measures to be a substitute for, or superior to, financial measures calculated in accordance with GAAP. Consistent with this approach, Marvell believes that disclosing non-GAAP financial measures to the readers of its financial statements provides such readers with useful supplemental data that, while not a substitute for GAAP financial measures, allows for greater transparency in the review of its financial and operational performance.
Externally, management believes that investors may find Marvell's non-GAAP financial measures useful in their assessment of Marvell's operating performance and the valuation of Marvell. Internally, Marvell's non-GAAP financial measures are used in the following areas: