Marvell shares surge after winning S&P 500 spot

Marvell Technology shares rose more than 7% in premarket trading on Monday after the chipmaker was set to join the benchmark S&P 500 at the end of June, marking the latest boost for a stock that has seen a strong recent rally, News.Az reports, citing Reuters.

The company’s shares have gained about 59% since May 27 after it projected that its custom-chip business would exceed $10 billion in revenue in fiscal 2029. The surge was also supported by comments from Jensen Huang, who described Marvell as a potential “trillion-dollar company.”

Despite the recent rally, the stock fell 16.7% in regular trading on Friday amid a broader market selloff that erased around $1.3 trillion in value across the semiconductor sector. Marvell had a market capitalization of about $230 billion at the previous close.

Marvell and its larger competitor Broadcom design custom chips for cloud computing data centers, a segment that has expanded rapidly as major technology firms look for alternatives to Nvidia’s high-cost and hard-to-source AI processors.

S&P Dow Jones Indices announced late Friday that Marvell will replace swimming pool equipment distributor Pool Corp in the S&P 500 index. The change will take effect before markets open on June 22.

Exchange-traded funds that track the index will be required to adjust their portfolios accordingly, which typically leads to increased demand for newly added stocks as passive investment flows enter the market around inclusion dates.

The inclusion follows Marvell’s return to GAAP profitability over the three months through December and across its most recent four quarters, clearing a key requirement that had previously prevented its entry into the index.

Marvell’s addition highlights how the ongoing artificial intelligence boom is reshaping major U.S. equity indices, with semiconductor and data center infrastructure companies gaining larger weightings due to strong investor demand.

Despite Friday’s decline, chip stocks remain elevated, with the Philadelphia Semiconductor Index up more than 72% year to date. Marvell itself has more than tripled in value, recently reaching record highs.

News.Az 

By Nijat Babayev