What's going on with Marvell?

I don't know to be honest.

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First, congratulations to Matt Murphy and the non-trivial number of Marvell employees who are subscribed.

Up 60% in one week lol.

Don’t worry about me I was not short.

Gave up trying to short back at $172.

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Marvell is by far the most asked about stock from institutional investors. There are at least 10 hedge funds and 3 family offices who constantly ask me about this ticker.

I don’t know what is happening.

But I will write a public note on some best guesses. Please friends lets talk about something more interesting. AMD is interesting.

No, I am not going to buy into Marvell. In truth, AMD CPU story is more interesting and I am debating on sizing up the position. You will see my trading book and long-only book at end of this post. Generally happy with the state of everything but need more Samsung, considering more AMD, and want to buy back into Ciena but too levered and AMD probably takes priority.

Contents:

1. Politics and Conspiracy Theories

2. Dense SRAM

3. DDR4 CXL Re-Use

4. Holdings Update

[1] Politics and Conspiracy Theories

Jensen $2B into Marvell has vastly out-performed his own stock. Why buy-back shares when you can make meme investments in competitors and suppliers?

The motivation of Mr. Leather Jacket is unclear. I have some guesses but zero conviction behind said guesses so take with large grain of salt.

• Force Amazon to use NVLink Fusion instead of Celestial?

• Block AMD from custom high-performance switchs?

• Weaken Broadcom?

• Get access to Celestial IP as a backup plan if ring modulators don’t scale?

• Get access to Marvell dense SRAM IP?

There was quite a bit of friction between Nvidia and Marvell over optical DSP pricing and performance. Nvidia has their own internal DSP which seems pretty good (recent OFC demo) but may or may not be designed into 1.6T transceivers. So much drama around this I gave up. Waste of thinking time.

[2] Dense SRAM

Marvell showed excellent results of their custom dense SRAM IP at Hot Chips last year. In truth, I don’t understand how it works but the data they showed is rock solid and excellent. Only caveat is their comparisons are against (my guess) Synopsys stock IP. Nvidia, AMD, and have better internal SRAM IP but maybe Marvell’s is still a lot better.

They can run at 500 mV (450 if you push it and ignore cold corner) which is kinda incredible. Usually the floor is around 630 mV… maybe 600 mV.

Licensable = Synopsys

Still, gap is so wide this IP is probably better than most if not all internal SRAM IP from Nvidia, AMD, Broadcom, ect.

This data is super legit. Not cheesed. Just want to point out that in this plot the lowest voltage corner is at 630 mV for N3 while the previous data was for N2. If you ignore < 10C as an operating condition (reasonable for datacenter) then they can drop the voltage way more.

[3] DDR4 CXL Re-Use

At the time of the Hot Chips presentation last year, I viewed CXL as a dead technology. With DRAM going to the moon, well now view has to change.

When old CPU servers are de-commissioned, the DDR4 is not useful anymore. Say you consolidate 3 old DDR4 CPU servers into 1 DDR5 CPU server. That DDR4 usually gets fire sold on eBay or scrapped.

With Marvell Structera (CXL card), Hyperscalers can re-use all that DDR4 in a memory pool. Sure, the latency is dogshit but its way better than NAND storage and DRAM prices have gone exponential with a crippling shortage.

Amusingly this Structera product went from worthless garbage to extremely valuable and it seems nobody has noticed.

This one is for DDR5 but they have a DDR4 version as well.

Not kidding, Marvell’s highest gross margin product is probably the DDR4 Structera card and this most profitable chip is gona go from zero to a large revenue number.

In a world where DRAM prices have gone up like crazy and there is a crippling historical shortage, the residual value of old fully-depreciated DDR4 DRAM sticks from old de-commissioned CPU servers is extremely high.

Marvell can probably charge like 85% margins on this Structera chips and get away with it. The value of re-using old DDR4 sticks is so high nobody will complain.

Astera Labs is the other CXL play but the Marvell product is just better. Way better interface IP than the Synopsys stuff Astera licenses. And remember, dense SRAM! You want SRAM as a cache to hide the latency of the CXL controller.

[4] Holdings Update

I am in the process of finishing up a (rare) re-balance of the long-only accounts. Would say 90% of the way there. Want to make Samsung a > 5% position but perhaps it will have to wait for cashflow via dayjob. Maybe cut GEV in half again and send proceeds to IBKR for buying moar Samsung. Trading account generally happy but want to size up AMD… a lot. Still thinking this thru. Also, I have no plan on how to pay the estimated $56K in tax pre-payment due by July 15th. Problem for future me.

Also if Ciena shits itself this week from earnings I will buy back in. If they moon I will also probably FOMO in anyway. Very unhappy with how I played Ciena this year.