Marvell Technology, Inc. (NASDAQ:MRVL) Q4 2023 Earnings Call Transcript

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And we’re very encouraged on that outlook. And then, in addition, some of these systems for AI clusters are going to get — have to get — data centers are going to have to get rearchitected quite frankly. And we think that’s also going to drive the need for cloud optimized silicon as well to complement the GPUs that are used, as well as the optics. So, I think, there’s a broader opportunity here for sure. I think this is a very bright spot for us in the cloud. And I think it’s evolving very quickly. Ashish, did you want to add anything to that?

Ashish Saran: No, I think the other thing I’d add is, I think we’re already starting to see requests from cloud customers to really accelerate the availability of our next-gen products, right? I think we’ve seen a distinct change in tone, I would say, over the last quarter or two where we introduced our 1.60 as an example. You’re certainly getting a request at a, how quickly can it become available, because they see the bandwidth needs really expanding very, very quickly. So I think it’s very critical for us to get these products out even faster.

Toshiya Hari: Thanks, guys.

Operator: And our next question will come from C. J. Muse of Evercore. Please, go ahead.

C.J. Muse: Yes. Good afternoon. Thank you for taking the question. Just routine part for you, Matt. So I won’t take too long. But specific to data center, I was hoping we could drill a little bit deeper into kind of the trends you’ve seen year-on-year based on the implied guide. So roughly, I think, down to $220 million. Is there a way to kind of parse through how much of that is storage, preamp, fiber channel and other? And maybe help us better understand kind of the slowdown in other, what drove that? And then from here, how do you think about the different parts between kind of storage, other and the new products that you already kind of spoke about. So we have a pretty good idea there. But any way to kind of frame that would be very helpful.

Matt Murphy: Yes. Sure. Yes, C. J., sure, go ahead. I’ll let Willem start off, and then I can add to it as appropriate. Great question.

Willem Meintjes: Yes. So, I think, first of all, on a year-over-year basis, storage is a much bigger part of that decline for Q1. The way we think about it, C. J., we spoke originally about the $1.4 billion for storage, right? And so, if you look at that on a quarterly basis, it’s about 60% was data center. So on a quarterly basis, it’s just over $200 million. And last quarter, we obviously indicated that was down significantly. And this quarter, again, the decrease in data center was more in storage compared to the rest.

C.J. Muse: I guess, is there a way to frame what the other parties outside of storage? I mean, it certainly feels like roughly maybe $150 million out of the $220 million decline in storage, but we’d love to isolate on that 70 and how you see that part of your business recovery?

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