Marvell Technology Q1 Profit Slips, But Tops View - Update

(RTTNews) - Marvell Technology Group Ltd. (MRVL) on Thursday said its fourth-quarter profit plunged from a year ago, as revenues dropped 24 percent. Earnings for the quarter trumped Wall Street estimates by a penny, but revenues fell short of expectations. Looking ahead, the chip maker detailed a weak outlook for the second quarter.

Santa Clara, California-based Marvell's first-quarter profit dropped to $14.1 million or $0.03 per share from $99.5 million or $0.19 per share last year.

Excluding special items, adjusted earnings dropped to $71.1 million or $0.13 per share from $144.2 million or $0.27 per share last year. On average, 27 analysts polled by Thomson Reuters expected earnings of $0.10 per share for the quarter. Analysts' estimates typically exclude special items.

Marvell's revenues for the first quarter fell 24 percent to $724.3 million from $957.8 million a year ago. Analysts had a consensus revenue estimate of $733.83 million for the quarter.

Gross margins for the quarter rose to 51.5 percent from 48.4 percent a year ago, while operating costs declined to $359.9 million from $371.0 million last year.

Looking forward to the second quarter, the company expects adjusted earnings of $0.11 per share, plus or minus $0.01 per share, and revenues of $710 million to $740 million. Analysts currently expect earnings of $0.16 per share on revenue of $784.25 million for the quarter.

Separately, Marvell Technology announced its Chief Financial Officer Mike Rashkin's intention to retire as CFO, effective May 22, after serving in the position for about one and a half years. The company has appointed Sukhi Nagesh, vice president of finance and investor relations, to serve as interim CFO.

MRVL closed Thursday's trading at $14.37, up $0.23 or 1.63%, on the Nasdaq. The stock, however, dropped $0.37 or 2.57%, in the after hours trade.