Jim Cramer Cheered Marvell’s $12 Billion Google Deal but the Stock Just Fell Nearly 10%
Jim Cramer celebrated a blockbuster Google deal as proof that Marvell's CEO scores again, but the stock just shed nearly 10% after the earnings call revealed something the headline never mentioned.
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Two weeks ago, Jim Cramer took a victory lap on Marvell Technology (NASDAQ:MRVL | MRVL Price Prediction). On Aug. 19, he reposted a CNBC headline that read “Marvell pops 6% on AI chip deal that lets Google buy up to $12.2 billion in shares,” and one minute later, he added “Matt ‘trillion dollar’ Murphy scores again.”
Today, the trade looks different. Marvell shares fell 9.96% to roughly $217, giving back a chunk of a 184.54% year-to-date run.
Quote That Broke the Trade
On the Aug. 27 call, CEO Matt Murphy deflated the incremental-revenue narrative. On the newly disclosed warrant with Google, management said: “In terms of the impact of the new Warrant Agreement, revenue from programs covered by the agreement through fiscal 2028 is already reflected in the overall custom revenue target we have previously provided.”
Translation: the $12 billion headline was already baked into the existing model. The bigger payoff from the Google relationship is not expected until fiscal 2029, when Marvell’s custom chip business targets $10 billion to $11 billion in revenue. Murphy said directly: “Most of this is comprehended already in next year. The big impact would be, you know, in 29 and beyond.”
Strong Quarter, Stronger Setup
The earnings report itself was solid. Q2 FY2027 revenue hit a record $2.739 billion, up 36.55% year over year, with non-GAAP EPS of $0.94. Data Center revenue reached $2.1715 billion, up 46%, now accounting for 79% of the business. Murphy raised guidance: “we now expect overall Marvell revenue in fiscal 2027 to grow approximately 45% year over year to roughly $12 billion, up from our prior outlook of approximately $11.5 billion just one quarter ago.”
Fiscal 2028 was raised to roughly $18 billion in revenue, with data center growth pegged at more than 60% year over year. Q3 guidance calls for $3.150 billion +/- 5% and non-GAAP EPS of $1.10 +/- 5 cents.
The problem is what was already priced in. The stock ran 38.39% in the past month alone. Against that backdrop, a 1.2% revenue beat and a 1.19% EPS beat felt like “a meet rather than a beat.” The bigger gains in AI silicon still tend to accrue to buyers who spot the setup early, which is the pattern we cataloged in a free playbook on the next generation of chip winners.
What to Watch Next
Murphy pointed investors to the Oct. 6 investor day in New York City, promising “a very robust detailed review of how we step through the revenue not just through fiscal 29 but really out until the end of the decade.” He added the outlook carries “upside bias” in fiscal 2029.
One footnote: Murphy disposed of 7,500 shares on Aug. 17 at $236.08, above where the stock traded yesterday ($208.02 on Sept. 1). The filing does not indicate whether the sale was executed under a Rule 10b5-1 plan.
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Joel South covers large-cap stocks, dividend investing, and major market trends, with a focus on earnings analysis, valuation, and turning complex data into actionable insights for investors.
He brings more than 15 years of experience as an investor and financial journalist, including 12 years at The Motley Fool, where he served as an investment analyst, Bureau Chief, and later led the Fool.com investing news desk. He has also co-hosted an investing podcast and appeared across TV and radio discussing market trends.
