Marvell Technology (MRVL) Slid as Revenue Guidance Fell Short of Expectations

Fred Alger Management, an investment management company, released its “Alger Mid Cap Focus Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q1 2025, U.S. equities faced increased volatility due to shifting fiscal, monetary, and trade policies. The rise of advanced AI models from China, which matched U.S. capabilities at lower costs, intensified this uncertainty. As a result, investors reevaluated the high capital expenditures of U.S. tech firms, leading to a sell-off in AI stocks and concerns over domestic AI returns. Against this backdrop, Class A shares of the Fund underperformed the Russell Midcap Growth in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Alger Mid Cap Focus Fund highlighted stocks such as Marvell Technology, Inc. (NASDAQ:MRVL). Marvell Technology, Inc. (NASDAQ:MRVL) offers data infrastructure semiconductor solutions, spanning the data center core to the network edge. The one-month return of Marvell Technology, Inc. (NASDAQ:MRVL) was 5.97%, and its shares lost 15.95% of their value over the last 52 weeks. On May 28, 2025, Marvell Technology, Inc. (NASDAQ:MRVL) stock closed at $64.59 per share with a market capitalization of $55.79 billion.

Alger Mid Cap Focus Fund stated the following regarding Marvell Technology, Inc. (NASDAQ:MRVL) in its Q1 2025 investor letter:

“Marvell Technology, Inc. (NASDAQ:MRVL) is a leading semiconductor company that designs advanced standard and customized chips, specializing in complex system-on-chip solutions combining analog, mixed-signal, and digital processing technologies. Marvell’s extensive portfolio covers computing, networking, optics, storage, and security applications, serving diverse markets including enterprise, cloud, telecommunications, automotive, and industrial sectors. The company has strategically transformed into a leader in data center silicon through targeted acquisitions and divestitures. Although Marvell reported strong fiscal fourth-quarter operating results that exceeded consensus estimates, shares declined after management’s fiscal first-quarter revenue guidance fell short of analyst expectations. Additionally, broader market concerns about increased tariffs on semiconductor products and a general downturn in AI-related stocks further pressured Marvell’s share price, detracting from quarterly performance. Despite the challenging quarter, we believe Marvell’s robust intellectual property portfolio positions it well to capitalize on long-term growth trends in cloud computing, 5G infrastructure, advanced automotive systems, enterprise networking, and security, supporting sustained sales and earnings growth.”

Susquehanna Cuts Marvell (MRVL) Price Target to $90, Keeps Positive Rating Ahead of Earnings

An assembly line in a semiconductor factory, with workers at their stations.

Marvell Technology, Inc. (NASDAQ:MRVL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 73 hedge fund portfolios held Marvell Technology, Inc. (NASDAQ:MRVL) at the end of the first quarter, which was 105 in the previous quarter. While we acknowledge the potential of Marvell Technology, Inc. (NASDAQ:MRVL) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Marvell Technology, Inc. (NASDAQ:MRVL) and shared the list of AI stocks gaining Wall Street’s attention. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.