American semiconductor design company Marvel announced a price increase for all its products, which is seen as the beginning of price hikes in the field of optical communications.
On October 21st, according to Taiwanese media reports, due to the surge in demand for AI (artificial intelligence), Marvel recently issued a notice to customers announcing that its entire product line will increase prices from January 1st, 2025.
Dean Jarnac, Senior Vice President of Global Sales at Marvel, mentioned in the price increase notice letter that in response to the surge in global demand for accelerated computing and AI, the company will continue to innovate and increase investment to provide customers with cutting-edge products and technologies. Due to the increase in investment amount, Marvel will raise prices for all products and minimize the price increase as much as possible to mitigate the impact on customers. Jarnac reminds customers to consider delivery time and provide accurate demand forecasts before placing an order.
After the news came out, the stock price of Marvel (Nasdaq: MRVL) rose 2.48% on the 21st to close at $81.83 per share, with a total market value of $70.9 billion. Data shows that since the beginning of this year, Marvel's stock price has risen by 36.17%.
On October 22nd, A-share optical communication concept stocks rose in the morning session, with Mingpu Optoelectronics (002902) and Guangku Technology (300620) opening at the limit up. Taichen Light (300570) and Changguang Huaxin (688048) both rose more than 10% at one point, while Yongding Shares (600105), Shijia Photon (688313), Liante Technology (301205) and others opened higher.
Public information shows that Marvel is one of the world's leading providers of semiconductor and network communication technologies, with products covering multiple fields such as data centers, enterprise networks, 5G, and telecommunications. The company was listed on NASDAQ in 2000, and its global shipments of 4G LTE chips were among the top three. According to TrendForce's 2023 global IC design company revenue ranking (pure IC design companies without wafer foundries), Marvel ranks sixth in the world.
Benefiting from the high demand for AI related cloud data centers such as ASIC (Application Specific Integrated Circuit) and silicon optics, Marvel submitted impressive financial reports in the previous fiscal quarter.
On August 30th of this year, Marvel released its second quarter financial report for the fiscal year 2025, which showed a net income of $1.2729 billion (approximately RMB 9.078 billion), a year-on-year decrease of 5.07% but a month on month increase of 9.65%. The company's 800G PAM chips, 400ZR Data Center Interconnect (DCI) and other optical communication products have become important growth engines, driving a year-on-year increase of over 90% in data center revenue.
Marvel CEO Matt Murphy revealed at the time that the company's data center business would continue to accelerate its growth, while the enterprise network and telecommunications terminal markets would also return to the growth track, and operational recovery was expected in the future.
Analysis points out that industry insiders are optimistic that Marvel will take the lead in raising prices in the industry, which also reflects the frenzy of demand in the semiconductor market stimulated by AI. This to some extent confirms the view previously put forward by AI chip leader NVIDIA CEO Huang Renxun that "market demand is exceptionally crazy".