Marvell Technology (MRVL), a data infrastructure chip design company, hit a record high of approximately $330 during intraday trading on Thursday before pulling back, closing up about 7% at around $311. The stock has accumulated gains of more than double in 2026. At the same time, a Wall Street analyst raised the stock’s 12-month price target from $260 to $385, citing optimism about the company’s optical networking business opportunities.
Notably, one possible trigger for this stock price increase had almost nothing to do with Marvell’s own announcements, but instead stemmed from a report about how Amazon (AMZN) might handle a chip product line that Marvell helped design.
According to Bloomberg, Amazon’s cloud computing division, Amazon Web Services, is in early-stage negotiations regarding the direct sale of its custom Trainium artificial intelligence (AI) chips to external companies for use in their own data centers. Previously, Trainium was only available to customers who leased computing capacity through AWS. If external sales are ultimately implemented, it would mark a significant strategic shift and could pose another challenge to Nvidia’s (NVDA) graphics processing units (GPUs), which currently dominate the AI computing market.
The market’s focus is on why a potential move involving Amazon’s chips would push another company’s stock to a new high.
Marvell has been one of the core partners assisting Amazon in designing the Trainium chip, and this business falls under the company’s most important segment. Marvell’s data center business generated approximately $1.83 billion in revenue in the first quarter of fiscal 2027 (ended May 2, 2026), up 27% year-over-year, accounting for about 76% of the company’s total revenue. Total company revenue reached a record $2.4 billion, up 28% year-over-year. Management expects second-quarter revenue to be approximately $2.7 billion, up about 35% year-over-year.
Marvell CEO Matt Murphy stated that, given what the company calls exceptionally strong AI-related orders, it has raised its revenue expectations for fiscal 2027 and fiscal 2028. Demand was already high before this news came out.
The report that AWS may expand Trainium sales beyond its own cloud services suggests additional demand. Amazon’s AI business head, Peter DeSantis, said that the current generation of chips is largely sold out and positioned external sales as a way to reach more customers, rather than cannibalizing AWS’s own business. In an interview with Bloomberg, he said that AI infrastructure is developing rapidly and that the company continues to explore ways to reach more customers.
If Trainium chip production and sales scale up, Marvell’s share of the custom chip business it can provide would also increase accordingly. In addition, the company produces high-speed optical modules and networking equipment needed to connect thousands of chips into a unified AI system.
However, an expanded Trainium market does not necessarily mean automatic growth for Marvell’s business. Although Marvell participated in the design of early Trainium chips, reports indicate that Amazon has awarded the design work for the newer Trainium3 and Trainium4 chips to Taiwan-based competitor Alchip Technologies, a change that has not been confirmed by either company.
Another risk comes from valuation. Marvell’s forward price-to-earnings ratio is currently around 70 times, a level that already factors in strong growth expectations for the next several years, leaving extremely limited room for any unexpected hiccups.
Taken together, Marvell is indeed in an attractive niche within the AI buildout wave, and the expansion of Amazon’s chip market could be a positive for the company. At the same time, the company is scheduled to be added to the S&P 500 on June 22. However, how much of the Trainium-related design work it will retain remains unclear, and with the current valuation approaching perfection, investment decisions are quite difficult.
