Marvell Technology, Inc. (MRVL): A Bear Case Theory

We came across a bearish thesis on Marvell Technology, Inc. on Irrational Analysis’s Substack. In this article, we will summarize the bulls’ thesis on MRVL. Marvell Technology, Inc.'s share was trading at $77.34 as of August 8^th. MRVL’s trailing and forward P/E were 22.15 and 27.40, respectively according to Yahoo Finance.

Marvell is currently facing significant setbacks with its high-speed SerDes technology, a critical component in its networking and custom AI chip initiatives, leading to strained relationships with major customers like Microsoft and Amazon. Recent reports from Edgewater Securities and Semianalysis reveal that both Marvell and its competitors have struggled with SerDes performance issues, causing delays such as a second tape-out for the Trn3 ASIC and pushing mass production to the second half of 2026.

Microsoft is reportedly reconsidering Marvell as a silicon partner due to underwhelming networking performance, while Amazon is shifting its Trainum 4 AI chip production away from Marvell to alternative suppliers like Alchip and Astera Labs, which use more reliable IP from Synopsys and Cadence.

Marvell’s internal attempts to hype its XPU and AI socket initiatives have been met with skepticism, as industry insiders claim Marvell is not involved in key emerging AI projects. Despite boasting of numerous ISSCC publications and advanced 5nm SerDes demos, real-world performance has been disappointing—demos have shown high error rates even with aggressive cooling, and comparisons favor competitors like Broadcom, whose SerDes deliver better error correction and reliability. Marvell’s sales and demo tactics, including selective performance metrics and controlled testing environments, have been criticized as misleading.

While some technological advances like dense SRAM and novel power delivery (PIVR) are praised, the overall narrative suggests Marvell is struggling to deliver the promised value in its cutting-edge chip segments. The combination of delayed products, technical flaws, and customer defections casts a shadow over Marvell’s growth prospects and raises questions about its ability to compete against rivals with superior IP and execution.

Previously we covered a bullish thesis on Marvell Technology, Inc. by Simple Investing in January 2025, which highlighted Marvell’s strong data center growth, custom silicon deals, and positive financial outlook. The company's stock price has depreciated approximately by 32% since our coverage, reflecting setbacks in SerDes technology and customer concerns. The thesis still stands as Marvell’s IP portfolio and market diversification support long-term growth. Irrational Analysis shares a contrarian view but emphasizes near-term technical and execution challenges.

Marvell Technology, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 73 hedge fund portfolios held MRVL at the end of the first quarter which was 105 in the previous quarter. While we acknowledge the potential of MRVL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.