(Bloomberg) — Marvell Technology Inc. surged 16% during premarket trading in New York on Friday after the chipmaker said it expects revenue from artificial intelligence to soar this year, capitalizing on a spending boom that also sent Nvidia Corp. on a record-setting rally this week.
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Sales of AI-related products will at least double in its current fiscal year, Marvell said in a statement Thursday. Adjusted earnings for the first quarter also came in just above analysts’ estimates.
The stock ended Thursday’s session up 7.6% to $49.47 and has gained 33.6% during the year to date.
“AI has emerged as a key growth driver for Marvell, which we are enabling with our leading network connectivity products and emerging cloud optimized silicon platform,” Chief Executive Officer Matt Murphy said in the statement. “While we are still in the early stages of our AI ramp, we are forecasting our AI revenue in fiscal 2024 to at least double from the prior year and continue to grow rapidly in the coming years.”
Chip investors are piling money into companies with AI growth prospects. A rosy forecast by Nvidia helped send its market value past $930 billion Thursday and lifted shares of other providers of semiconductors and artificial intelligence technology.
Read More: Nvidia’s Blowout Forecast Sparks Huge Rally in All Things AI
Marvell said revenue this quarter will be about $1.33 billion, roughly in line with analysts’ predictions.
(Updates with premarket trading in first paragraph)
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