Marvell Technology's stock plummeted on Friday after the chipmaker reported impressive second-quarter results, only to be overshadowed by disappointing guidance for the third quarter. Investors grew anxious, prompting analysts to revise price forecasts downward.

In its earnings report, Marvell announced adjusted earnings of 67 cents per share, beating Wall Street's estimate of 66 cents. However, revenue of $2.006 billion fell just short of the $2.009 billion expectation, raising eyebrows among analysts.

Despite this, CEO Matt Murphy highlighted the company's record revenue, showcasing a 58% year-over-year jump. He emphasized strong growth driven by robust demand in AI technology and custom silicon products.

Yet, when forecasting the third quarter, Marvell projected revenue between $1.957 billion and $2.163 billion, well below the $2.105 billion consensus. Furthermore, adjusted earnings per share are expected to be between 69 to 79 cents, lower than earlier predictions.

Analysts reacted swiftly—Kevin Cassidy from Rosenblatt Securities noted that while earnings beat expectations, data center shipment adjustments influenced revenue projections. The firm lowered its fiscal 2027 revenue outlook partly due to the spin-off of Marvell’s Automotive Ethernet division.

In a somewhat positive light, Rosenblatt kept a Buy rating as they identified a strong portfolio of upcoming products that could diversify Marvell's revenue streams. However, they reduced their 12-month price target significantly from $124 to $95.

On a similar note, JP Morgan's analyst Harlan Sur conveyed that Marvell's results matched expectations, pointing to stronger consumer demand as a bright spot, even as data center and carrier sales lagged.

The firm anticipates that data center revenue will remain flat, while optical networking is projected to grow, although custom ASIC shipments will take time to ramp up effectively. They reiterated an Overweight rating, although scenarios of lumpiness in the short term led to a price forecast drop from $130 to $120.

Goldman Sachs echoed a cautious sentiment, acknowledging results slightly exceeded margin expectations but noted little promise in sales growth. Analyst James Schneider suggested that Marvell's custom silicon business might face hurdles in the near future, prompting a price target adjustment from $75 to $72. Data center revenue showed modest sequential growth but was offset by declines in custom silicon.

As of the latest trading session, Marvell stocks have dropped significantly by 16.15%, landing at $64.76. Investors are left grappling with the uncertainty surrounding Marvell’s immediate future as the chipmaker navigates challenging market conditions.