U.S. Markets closed

Marvell Solutions Power Toshiba 16TB Enterprise HDD Products

Zacks Equity Research

Marvell MRVL recently announced that one of its largest customers, Toshiba, has included its hard disk drive (HDD) controller and preamplifier into the latter’s 16TB Enterprise Capacity HDD portfolio.

The Marvell HDD controller boasts Read Channel technology, leading error correction code IP and power efficiency. Moreover, the preamplifier enables advanced two-dimensional magnetic recording technology and supports Toshiba's 9-disk architecture.  

The key feature of Marvell’s storage chip is that the HDD controller and preamplifier are designed closely to create a comprehensive chipset solution.

Competition Hurting Growth Prospects

Marvell has been negatively impacted by lower cloud spending and CPU shortages. Additionally, shift in demand for products consigned to vendor-managed inventory arrangements is a headwind.

In the fourth quarter of fiscal 2019 (ended Feb 02), Marvell’s storage revenues, which constitute 43% of total revenues, declined 2% year over year and 22% sequentially to $317 million.

Although expanding storage market presents growth opportunity, Marvell is losing market share, which doesn’t bode well for investors.

Per IDC data, the global enterprise storage market witnessed a 7.4% year-over-year rally to reach $14.5 billion in calendar fourth-quarter 2018.With 18.7% global share, Dell DELL took the biggest piece of the pie, followed by Hewlett Packard HPE with 17.8%.

Further, in the High Definition storage drive market, Marvell is facing stiff competition from Broadcom AVGO as both are primary SoC (system on a chip) suppliers.

Notably, Broadcom increased its investment in Hewlett Packard’s server storage solutions in calendar 2018, creating further woes for Marvell.

Also, NXP Semiconductors, Qualcomm and Texas Instruments offer various components to the market, adding to the competition.


Nonetheless, Marvell’s announcement of the shipment of its HDD products to Toshiba reflects the value of its engineering expertise, and its focus on continued investment in HDD technology to boost its storage segment.

Marvell Technology Group Ltd. Price and Consensus

Marvell Technology Group Ltd. Price and Consensus | Marvell Technology Group Ltd. Quote

Marvell currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Today's Best Stocks from Zacks

Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.

This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.

See their latest picks free >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Hewlett Packard Enterprise Company (HPE) : Free Stock Analysis Report
Marvell Technology Group Ltd. (MRVL) : Free Stock Analysis Report
Dell Technologies Inc. (DELL) : Free Stock Analysis Report
Broadcom Inc. (AVGO) : Free Stock Analysis Report
To read this article on Zacks.com click here.