William Blair analyst Sebastien Naji reiterated an Outperform rating on Marvell (NASDAQ: MRVL)

The analyst commented, "

Before the market open on Tuesday, Marvell and Nvidia (NVDA $172.90; Outperform) announced a tightening of their partnership as part of NVLink Fusion. While Marvell was part of the original NVLink Fusion ecosystem announcement at Computex in May 2025, we expect the deepening relationship relates to Marvell’s recent acquisition of Celestial whose Photonic Fabric (PF) IP is well positioned for the gradual shift toward co-packaged optics (CPO). In particular, Celestial’s photonic interconnect will enable scale-up connectivity between XPUs and memory fabric connectivity to expand near-processor memory capacity. Marvell and Nvidia will also collaborate on silicon photonics and advanced optical interconnects for telecom, leveraging Marvell’s photonics and optical DSP capabilities to support Nvidia’s Aerial AI-RAN portfolio for 5G/6G networks. Critically, the announcement includes a $2 billion equity investment from Nvidia, echoing a string of similar investments in optical vendors (Lumentum [LITE $687.56], Coherent [COHR $234.88; Market Perform]), amongst other ecosystem players (see the table below). For Nvidia, these recent investments are helping it secure and scale optical supply that will be key to its next-generation product ramp-ups in the coming years. In particular, Nvidia expects its Feynman rack in late 2028 to be the first to offer a scale-up CPO version—see our recent GTC note. For Marvell, this investment highlights the growing significance of interconnect technology as a pivotal enabler of AI system performance across future generations. We also see it as a vote of confidence in Marvell’s technology portfolio, which should help quell recurring questions about the quality of its underlying IP and ability to gain share."

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Shares of Marvell closed at $87.81 yesterday.