Shares of Marvell Know-how continued a major in a single day rally Friday morning, surging about 25% off the again of quarterly earnings outcomes that beat on the highest and backside traces.

On Thursday, the chipmaker posted 31 cents in adjusted earnings per share for the primary quarter, greater than the Refinitiv consensus estimate of 29 cents per share. Income got here in at $1.32 billion for the interval, greater than the $1.3 billion analyst consensus.

Marvell shares are actually buying and selling at ranges not seen since April 2022.

On an analyst convention name, Marvell CEO Matthew Murphy mentioned the corporate had begun to reassess the way it regarded on the “super” enterprise potential of AI.

“Up to now, we thought of AI to be one in every of many purposes inside cloud, however its significance and subsequently the chance has elevated dramatically,” Murphy mentioned.

Citi analysts mentioned in a be aware to traders that the corporate has a significant alternative to develop its AI-driven income. Citi upped its value goal from $58 to $61 and maintained its purchase score.

“In FY2023, MRVL estimated its AI income to be ~ $200 million, representing a robust uptick from FY22. The corporate expects AI gross sales to achieve ~$400M+ in FY24 earlier than doubling in FY25,” the be aware from Citi’s Atif Malik mentioned.

Many semiconductor companies skilled a elevate from Nvidia’s Wednesday blowout earnings report. Nvidia’s market capitalization now sits near $1 trillion.

— CNBC’s Michael Bloom and Chris Hayes contributed to this report.