filings.toolsItem 8. Financial Statements and Supplementary Data
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Item 8. Financial Statements and Supplementary Data
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the stockholders and the Board of Directors of Marvell Technology, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Marvell Technology, Inc. and subsidiaries (the "Company") as of February 1, 2025 and February 3, 2024, the related consolidated statements of operations, comprehensive loss, stockholders' equity, and cash flows, for each of the three years in the period ended February 1, 2025, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of February 1, 2025, and February 3, 2024, and the results of its operations and its cash flows for each of the three years in the period ended February 1, 2025, in conformity with accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of February 1, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 12, 2025, expressed an unqualified opinion on the Company's internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Inventories – Management Judgments Regarding Excess and Obsolete Inventory Reserves — Refer to Note 2 to the financial statements.
Critical Audit Matter Description
Management writes down excess inventories based upon a regular analysis of inventory on hand compared to forecasted demand. Management’s estimates of forecasted demand are based upon analysis and assumptions including, but not limited to, expected product lifecycles and development plans, expected customer orders, projected and current market conditions, historical usage by product, and customer backlog. As of February 1, 2025, the Company’s consolidated inventories balance was $1,029.7 million.
We identified inventory valuation as a critical audit matter because of the significant assumptions management makes with regards to estimating the excess write-down and the potential impact of those judgments. Specifically, due to assumptions related to forecasted demand and market conditions, performing audit procedures to evaluate the reasonableness of management’s estimates of forecasted demand required a high degree of auditor judgment and increased audit effort.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to management’s estimates of forecasted demand used in the valuation of inventory included the following, among others:
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We tested the effectiveness of internal controls over management’s provisions for excess and obsolete inventories, including internal controls designed to review and approve forecasted demand and the underlying assumptions regarding expected product lifecycles, product development plans, expected customer orders, projected and current market conditions, and historical usage by product.
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We evaluated management’s ability to accurately estimate forecasted demand by comparing estimates made in prior periods to the historical actual results for those same periods.
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We made inquiries of business unit managers throughout the period as well as executives, sales and marketing, and operations personnel about the expected product lifecycles and product development plans and historical usage by product and compared expectations to actual developments over the period.
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We selected a sample of inventory products and tested the forecasted demand by comparing internal and external information (e.g., historical usage, contracts, communications with customers, market conditions, etc.) with the Company’s forecast.
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We considered, when relevant, the existence of contradictory evidence based on reading of internal financial and operational information used by management and the board of directors, Company press releases, and analysts' reports, as well as our observations and inquires as to changes within the business and evidence obtained through other areas of the audit.
/s/ Deloitte & Touche LLP
San Jose, California
March 12, 2025
We have served as the Company’s auditor since 2016.
MARVELL TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(In millions, except par value per share)
| February 1, 2025 | February 3, 2024 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 948.3 | $ | 950.8 | |||||||
| Accounts receivable, net | 1,028.4 | 1,121.6 | |||||||||
| Inventories | 1,029.7 | 864.4 | |||||||||
| Prepaid expenses and other current assets | 113.9 | 125.9 | |||||||||
| Total current assets | 3,120.3 | 3,062.7 | |||||||||
| Property and equipment, net | 790.5 | 756.0 | |||||||||
| Goodwill | 11,586.9 | 11,586.9 | |||||||||
| Acquired intangible assets, net | 2,710.6 | 4,004.1 | |||||||||
| Deferred tax assets | 401.2 | 311.9 | |||||||||
| Other non-current assets | 1,595.0 | 1,506.9 | |||||||||
| Total assets | $ | 20,204.5 | $ | 21,228.5 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 622.2 | $ | 411.3 | |||||||
| Accrued liabilities | 972.6 | 1,032.9 | |||||||||
| Accrued employee compensation | 302.5 | 262.7 | |||||||||
| Short-term debt | 129.5 | 107.3 | |||||||||
| Total current liabilities | 2,026.8 | 1,814.2 | |||||||||
| Long-term debt | 3,934.3 | 4,058.6 | |||||||||
| Other non-current liabilities | 816.4 | 524.3 | |||||||||
| Total liabilities | 6,777.5 | 6,397.1 | |||||||||
| Commitments and contingencies (Note 8) | |||||||||||
| Stockholders’ equity: | |||||||||||
| Preferred stock, $0.002 par value; 8.0 shares authorized; no shares issued and outstanding | — | — | |||||||||
| Common stock, $0.002 par value; 1.3 billion shares authorized; 866.0 and 865.5 shares issued and outstanding in fiscal 2025 and 2024, respectively | 1.7 | 1.7 | |||||||||
| Additional paid-in capital | 14,534.1 | 14,845.3 | |||||||||
| Accumulated other comprehensive income | 0.4 | 1.1 | |||||||||
| Accumulated deficit | (1,109.2) | (16.7) | |||||||||
| Total stockholders’ equity | 13,427.0 | 14,831.4 | |||||||||
| Total liabilities and stockholders’ equity | $ | 20,204.5 | $ | 21,228.5 |
See accompanying Notes to Consolidated Financial Statements.
MARVELL TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share amounts)
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Net revenue | $ | 5,767.3 | $ | 5,507.7 | $ | 5,919.6 | |||||||||||
| Cost of goods sold | 3,385.1 | 3,214.1 | 2,932.1 | ||||||||||||||
| Gross profit | 2,382.2 | 2,293.6 | 2,987.5 | ||||||||||||||
| Operating expenses: | |||||||||||||||||
| Research and development | 1,950.4 | 1,896.2 | 1,784.3 | ||||||||||||||
| Selling, general and administrative | 798.2 | 834.0 | 843.6 | ||||||||||||||
| Legal settlement | — | — | 100.0 | ||||||||||||||
| Restructuring related charges | 353.9 | 131.1 | 21.6 | ||||||||||||||
| Total operating expenses | 3,102.5 | 2,861.3 | 2,749.5 | ||||||||||||||
| Operating income (loss) | (720.3) | (567.7) | 238.0 | ||||||||||||||
| Interest expense | (189.4) | (211.7) | (170.6) | ||||||||||||||
| Interest income and other, net | 15.0 | 20.7 | 17.7 | ||||||||||||||
| Interest and other loss, net | (174.4) | (191.0) | (152.9) | ||||||||||||||
| Income (loss) before income taxes | (894.7) | (758.7) | 85.1 | ||||||||||||||
| Provision (benefit) for income taxes | (9.7) | 174.7 | 248.6 | ||||||||||||||
| Net loss | $ | (885.0) | $ | (933.4) | $ | (163.5) | |||||||||||
| Net loss per share — basic | $ | (1.02) | $ | (1.08) | $ | (0.19) | |||||||||||
| Net loss per share — diluted | $ | (1.02) | $ | (1.08) | $ | (0.19) | |||||||||||
| Weighted-average shares: | |||||||||||||||||
| Basic | 865.5 | 861.3 | 851.4 | ||||||||||||||
| Diluted | 865.5 | 861.3 | 851.4 |
See accompanying Notes to Consolidated Financial Statements.
MARVELL TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In millions)
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Net loss | $ | (885.0) | $ | (933.4) | $ | (163.5) | |||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||
| Net change in unrealized gain (loss) on cash flow hedges | (0.7) | 1.1 | — | ||||||||||||||
| Other comprehensive income (loss), net of tax | (0.7) | 1.1 | — | ||||||||||||||
| Comprehensive loss, net of tax | $ | (885.7) | $ | (932.3) | $ | (163.5) |
See accompanying Notes to Consolidated Financial Statements.
MARVELL TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In millions, except per share amounts)
| Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Accumulated Deficit) | ||||||||||||||||||||||||||||||||
| Shares | Amount | Total | |||||||||||||||||||||||||||||||||
| Balance at January 29, 2022 | 846.7 | $ | 1.7 | $ | 14,209.0 | $ | — | $ | 1,491.4 | $ | 15,702.1 | ||||||||||||||||||||||||
| Issuance of common stock in connection with equity incentive plans | 11.7 | — | 91.3 | — | — | 91.3 | |||||||||||||||||||||||||||||
| Tax withholdings related to net share settlement of restricted stock units | — | — | (227.6) | — | — | (227.6) | |||||||||||||||||||||||||||||
| Stock-based compensation | — | — | 554.3 | — | — | 554.3 | |||||||||||||||||||||||||||||
| Repurchase of common stock | (2.3) | — | (115.0) | — | — | (115.0) | |||||||||||||||||||||||||||||
| Cash dividends declared and paid (cumulatively $0.24 per share) | — | — | — | — | (204.4) | (204.4) | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (163.5) | (163.5) | |||||||||||||||||||||||||||||
| Balance at January 28, 2023 | 856.1 | 1.7 | 14,512.0 | — | 1,123.5 | 15,637.2 | |||||||||||||||||||||||||||||
| Issuance of common stock in connection with equity incentive plans | 11.9 | — | 99.2 | — | — | 99.2 | |||||||||||||||||||||||||||||
| Tax withholdings related to net share settlement of restricted stock units | — | — | (223.7) | — | — | (223.7) | |||||||||||||||||||||||||||||
| Stock-based compensation | — | — | 607.8 | — | — | 607.8 | |||||||||||||||||||||||||||||
| Repurchase of common stock | (2.5) | — | (150.0) | — | — | (150.0) | |||||||||||||||||||||||||||||
| Cash dividends declared and paid (cumulatively $0.24 per share) | — | — | — | — | (206.8) | (206.8) | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (933.4) | (933.4) | |||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | 1.1 | — | 1.1 | |||||||||||||||||||||||||||||
| Balance at February 3, 2024 | 865.5 | 1.7 | 14,845.3 | 1.1 | (16.7) | 14,831.4 | |||||||||||||||||||||||||||||
| Issuance of common stock in connection with equity incentive plans | 9.5 | — | 87.5 | — | — | 87.5 | |||||||||||||||||||||||||||||
| Tax withholdings related to net share settlement of restricted stock units | — | — | (274.9) | — | — | (274.9) | |||||||||||||||||||||||||||||
| Stock-based compensation | — | — | 595.8 | — | — | 595.8 | |||||||||||||||||||||||||||||
| Repurchase of common stock | (9.0) | — | (725.0) | — | — | (725.0) | |||||||||||||||||||||||||||||
| Vestings of common stock in connection with customer warrant | — | — | 5.4 | — | — | 5.4 | |||||||||||||||||||||||||||||
| Cash dividends declared and paid (cumulatively $0.24 per share) | — | — | — | — | (207.5) | (207.5) | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (885.0) | (885.0) | |||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | (0.7) | — | (0.7) | |||||||||||||||||||||||||||||
| Balance at February 1, 2025 | 866.0 | $ | 1.7 | $ | 14,534.1 | $ | 0.4 | $ | (1,109.2) | $ | 13,427.0 |
See accompanying Notes to Consolidated Financial Statements.
MARVELL TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||
| Net loss | $ | (885.0) | $ | (933.4) | $ | (163.5) | |||||||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||||||||
| Depreciation and amortization | 304.3 | 299.8 | 304.9 | ||||||||||||||
| Stock-based compensation | 597.4 | 609.8 | 552.4 | ||||||||||||||
| Amortization of acquired intangible assets | 1,052.6 | 1,097.9 | 1,087.4 | ||||||||||||||
| Amortization of inventory fair value adjustment associated with acquisitions | — | — | 38.7 | ||||||||||||||
| Restructuring related impairment charges | 528.8 | 32.9 | 5.6 | ||||||||||||||
| Deferred income taxes | (111.9) | 150.8 | 50.4 | ||||||||||||||
| Other expense, net | 65.9 | 54.9 | 62.7 | ||||||||||||||
| Changes in assets and liabilities, net of acquisitions: | |||||||||||||||||
| Accounts receivable | 93.2 | 70.6 | (142.7) | ||||||||||||||
| Prepaid expenses and other assets | 3.4 | (93.1) | (480.4) | ||||||||||||||
| Inventories | (230.0) | 201.9 | (385.9) | ||||||||||||||
| Accounts payable | 181.5 | (149.1) | (87.8) | ||||||||||||||
| Accrued employee compensation | 43.5 | 18.3 | 2.5 | ||||||||||||||
| Accrued liabilities and other non-current liabilities | 37.5 | 9.2 | 444.5 | ||||||||||||||
| Net cash provided by operating activities | 1,681.2 | 1,370.5 | 1,288.8 | ||||||||||||||
| Cash flows from investing activities: | |||||||||||||||||
| Purchases of technology licenses | (7.0) | (13.9) | (11.1) | ||||||||||||||
| Purchases of property and equipment | (284.6) | (336.3) | (206.2) | ||||||||||||||
| Acquisitions, net of cash acquired | (10.4) | — | (112.3) | ||||||||||||||
| Other, net | 1.3 | (0.3) | 1.2 | ||||||||||||||
| Net cash used in investing activities | (300.7) | (350.5) | (328.4) | ||||||||||||||
| Cash flows from financing activities: | |||||||||||||||||
| Repurchases of common stock | (725.0) | (150.0) | (115.0) | ||||||||||||||
| Proceeds from employee stock plans | 87.6 | 99.2 | 91.3 | ||||||||||||||
| Tax withholding paid on behalf of employees for net share settlement | (274.9) | (223.7) | (227.6) | ||||||||||||||
| Dividend payments to stockholders | (207.5) | (206.8) | (204.4) | ||||||||||||||
| Payments on technology license obligations | (153.6) | (150.3) | (142.5) | ||||||||||||||
| Proceeds from borrowings | — | 1,295.3 | 200.0 | ||||||||||||||
| Principal payments of debt | (109.4) | (1,622.5) | (265.6) | ||||||||||||||
| Other, net | (0.2) | (21.4) | 0.9 | ||||||||||||||
| Net cash used in financing activities | (1,383.0) | (980.2) | (662.9) | ||||||||||||||
| Net increase (decrease) in cash and cash equivalents | (2.5) | 39.8 | 297.5 | ||||||||||||||
| Cash and cash equivalents at beginning of the year | 950.8 | 911.0 | 613.5 | ||||||||||||||
| Cash and cash equivalents at end of the year | $ | 948.3 | $ | 950.8 | $ | 911.0 |
See accompanying Notes to Consolidated Financial Statements.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 — Basis of Presentation
The Company
Marvell Technology, Inc., and its subsidiaries (the “Company”), is a leading supplier of data infrastructure semiconductor solutions, spanning the data center core to network edge. The Company is a fabless supplier of high-performance semiconductor with core strengths in developing and scaling complex System-on-a-Chip architectures, integrating analog, mixed-signal and digital signal processing functionality. The Company also leverages leading intellectual property and deep system-level expertise, as well as highly innovative security firmware. The Company’s solutions are empowering the data economy and enabling the data center, enterprise networking, carrier infrastructure, consumer, and automotive/industrial end markets. The Company is incorporated in Delaware, United States.
Basis of Presentation
The Company’s fiscal year is the 52- or 53-week period ending on the Saturday closest to January 31. Accordingly, every fifth or sixth fiscal year will have a 53-week period. The additional week in a 53-week year is added to the fourth quarter, making such quarter consist of 14 weeks. Fiscal 2024 had a 53-week period. Fiscal 2025 and fiscal 2023 each had a 52-week period. Certain prior period amounts have been reclassified to conform to current year presentation. All dollar amounts in the financial statements and tables in these notes, except per share amounts, are stated in millions of U.S. dollars unless otherwise noted.
Note 2 — Significant Accounting Policies
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, provisions for sales returns and allowances, inventory excess and obsolescence, goodwill and other intangible assets, business combinations, restructuring, income taxes, litigation and other contingencies. Actual results could differ from these estimates, and such differences could affect the results of operations reported in future periods. In the current macroeconomic environment, these estimates could require increased judgment and carry a higher degree of variability and volatility. As events continue to evolve and additional information becomes available, these estimates may change materially in future periods.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated. The functional currency of the Company and its subsidiaries is the U.S. dollar.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks and time deposits.
Investments in Equity Securities
The Company has equity investments in privately-held companies. If the Company has the ability to exercise significant influence over the investee, but not control, the Company accounts for the investment under the equity method. If the Company does not have the ability to exercise significant influence over the operations of the investee, the Company accounts for the investment under the measurement alternative method. Investments in privately-held companies are included in other non-current assets and subject to impairment review on an ongoing basis. Investments are considered impaired when the fair value is below the investment’s cost basis. This assessment is based on a qualitative and quantitative analysis, including, but not limited to, the investee’s revenue and earnings trends, available cash and liquidity, and the status of the investee’s products and the related market for such products.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Concentration of Credit Risk and Significant Customers
Financial instruments that potentially subject the Company to a significant concentration of credit risk consist principally of cash equivalents and accounts receivable. Cash and cash equivalents are maintained with high-quality financial institutions, the composition and maturities of which are regularly monitored by management.
The Company believes that the concentration of credit risk in its trade receivables is substantially mitigated by the Company’s credit evaluation process, relatively short collection terms and the high level of credit worthiness of its customers. For customers including distributors and direct customers, the Company performs ongoing credit evaluations of their financial conditions and limits the amount of credit extended when deemed necessary based upon payment history and their current credit worthiness, but generally requires no collateral. The Company regularly reviews the allowance for credit losses by considering factors such as historical experience, credit quality, reasonable and supportable forecasts, age of the accounts receivable balances and current economic conditions that may affect a customer’s ability to pay.
The Company’s accounts receivable was concentrated with four customers at February 1, 2025, who comprise a total of 72% of gross accounts receivable, compared with three customers at February 3, 2024, who represented 67% of gross accounts receivable, respectively. This presentation is at the customer consolidated level.
Net revenue attributable to significant customers including both distributor and direct customers whose revenues represented 10% or more of total net revenue is presented in the following table:
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Direct Customer: | |||||||||||||||||
| Customer A | 13 | % | * | * | |||||||||||||
| Distributor: | |||||||||||||||||
| Distributor A | 34 | % | 24 | % | 20 | % | |||||||||||
*Less than 10% of net revenue.
The Company continuously monitors the creditworthiness of its distributor and direct customers, and believes the distributors’ sales to diverse end customers and to diverse geographies further serve to mitigate the Company’s exposure to credit risk.
Inventories
Inventory is stated at the lower of cost or net realizable value, cost being determined under the first-in, first-out method. The total carrying value of the Company’s inventory is reduced for any difference between cost and estimated net realizable value of inventory that is determined to be excess, obsolete or unsellable inventory based upon assumptions about future demand and market conditions. If actual future demand for the Company’s products is less than currently forecasted, the Company may be required to write inventory down below the current carrying value. Once the carrying value of inventory is reduced, it is maintained until the product to which it relates is sold or otherwise disposed. Inventoriable shipping and handling costs are classified as a component of cost of goods sold in the consolidated statements of operations.
Property and Equipment, Net
Property and equipment, net, are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which ranges from 2 to 7 years for machinery and equipment, and 3 to 4 years for computer software, and furniture and fixtures. Buildings are depreciated over an estimated useful life of 30 years and building improvements are depreciated over estimated useful lives of 15 years. Leasehold improvements are depreciated over the shorter of the remaining lease term or the estimated useful life of the asset.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Goodwill
Goodwill is recorded when the consideration paid for a business acquisition exceeds the fair value of net tangible and intangible assets acquired. Goodwill is measured and tested for impairment annually on the last business day of the fiscal fourth quarter and whenever events or changes in circumstances indicate the carrying amount of goodwill may not be recoverable. The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount or the Company may determine to proceed directly to the quantitative impairment test.
If the Company assesses qualitative factors and concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if the Company determines not to use the qualitative assessment, then a quantitative impairment test is performed. The quantitative impairment test requires comparing the fair value of the reporting unit to its carrying value, including goodwill. The Company has identified that its business operates as a single operating segment and as a single reporting unit for the purpose of goodwill impairment testing. An impairment exists if the fair value of the reporting unit is lower than its carrying value. If the fair value of the reporting unit is lower than its carrying value, the Company would record an impairment loss in the fiscal quarter in which the determination is made.
Long-Lived Assets and Intangible Assets
The Company assesses the impairment of long-lived assets and intangible assets whenever events or changes in circumstances indicate that the carrying amount of long-lived assets may not be recoverable. The Company estimates the future cash flows, undiscounted and without interest charges, expected to be generated by the assets from its use or eventual disposition. If the sum of the expected undiscounted future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets.
Acquisition-related identified intangible assets are amortized on a straight-line basis over their estimated economic lives, except for certain customer contracts and related relationships, which are amortized using an accelerated method of amortization over the expected customer lives. In-process research and development (“IPR&D”) is not amortized until the completion of the related development.
Leases
The Company determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Operating lease ROU assets also include any initial direct costs and prepayments less lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. As the Company’s leases do not provide an implicit rate, the Company uses its collateralized incremental borrowing rate based on the information available at the lease commencement date, including lease term, in determining the present value of lease payments. Lease expense for these leases is recognized on a straight-line basis over the lease term.
Foreign Currency Transactions
The functional currency of all of the Company’s non-United States (“U.S.”) operations is the U.S. dollar. Monetary accounts maintained in currencies other than the U.S. dollar are re-measured using the foreign exchange rate at the balance sheet date. Operational accounts and nonmonetary balance sheet accounts are measured and recorded at the exchange rate in effect at the date of the transaction. The effects of foreign currency re-measurement are reported in current operations.
Revenue Recognition
Product revenue is recognized at a point in time when control of the asset is transferred to the customer. Substantially all of the Company’s revenue is derived from product sales. The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product to a customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. For product revenue, the performance obligation is deemed to be the delivery of the product and therefore, the revenue is generally recognized upon shipment to customers, net of accruals for estimated sales returns and rebates. These estimates are based on historical returns, analysis of credit memo data and other known factors. The Company accounts for rebates by recording reductions to revenue for rebates in the same period that the related revenue is recorded. The amount of these reductions is based upon the terms agreed to with the customer. Product revenue on sales made to distributors is recognized upon shipment, net of estimated variable consideration. Variable consideration primarily consists of price discounts, price protection, rebates, and stock rotation programs and is estimated based on a portfolio approach using the expected value method derived from historical data, current economic conditions, and contractual terms.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
A portion of the Company’s net revenue is derived from sales through third-party logistics providers who maintain warehouses in close proximity to the Company’s customers’ facilities. Revenue from sales through these third-party logistics providers is not recognized until the product is pulled from stock by the customer.
The Company’s products are generally subject to warranty, which provides for the estimated future costs of replacement upon shipment of the product. The Company generally warrants that its products sold to its customers will conform to its approved specifications and be free from defects in material and workmanship under normal use and conditions for one year. The Company may offer a longer warranty period in limited situations based on product type and negotiated warranty terms with certain customers. The warranty accrual is estimated primarily based on historical claims compared to historical revenues and assumes that the Company will have to replace products subject to a claim. From time to time, the Company becomes aware of specific warranty situations, and it records specific accruals to cover these exposures.
Business Combinations
The Company allocates the fair value of the purchase consideration of its business acquisitions to the tangible assets, liabilities, and intangible assets acquired, including IPR&D, based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. IPR&D is initially capitalized at fair value as an intangible asset with an indefinite life and assessed for impairment thereafter. When an IPR&D project is completed, the IPR&D is reclassified as an amortizable purchased intangible asset and amortized over the asset’s estimated useful life. Acquisition-related expenses and related restructuring costs are recognized separately from the business combination and are expensed as incurred.
Stock-Based Compensation
Stock-based compensation is measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service vesting period. The Company amortizes stock-based compensation expense for time-based awards under the straight-line attribution method over the vesting period. Stock-based compensation expense for performance-based awards is recognized when it becomes probable that the performance conditions will be met. The Company amortizes stock-based compensation expense for performance-based awards using the accelerated method.
The fair value of each restricted stock unit is estimated based on the market price of the Company’s common stock on the date of grant less the expected dividend yield.
The Company estimates the fair value of stock purchase awards on the date of grant using the Black Scholes option-pricing model. The fair value of performance-based awards based on total shareholder return (“TSR”) are estimated on the date of grant using a Monte Carlo simulation model.
Forfeitures are recorded when they occur. Previously recognized expense is reversed for the portion of awards forfeited prior to vesting as and when forfeitures occur.
Comprehensive Loss
Comprehensive loss, net of tax is comprised of net loss and net change in unrealized gains and losses on cash flow hedges for fiscal 2025 and 2024. For fiscal 2023, there were no reconciling differences between net loss and comprehensive loss.
Accounting for Income Taxes
The Company estimates its income taxes in the jurisdictions in which it operates. This process involves estimating the Company’s actual tax expense together with assessing temporary differences resulting from the differing treatment of certain items for tax return and financial statement purposes. These differences result in deferred tax assets and liabilities, which are included in the Company’s consolidated balance sheets.
The Company recognizes income taxes using an asset and liability approach. This approach requires the recognition of taxes payable or refundable for the current year, and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the Company’s consolidated financial statements or tax returns. The measurement of current and deferred taxes is based on provisions of the enacted tax law and the effects of future changes in tax laws or rates are not anticipated.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Evaluating the need for a valuation allowance for deferred tax assets requires judgment and analysis of all available positive and negative evidence, including recent earnings history and cumulative losses in recent years, reversals of deferred tax liabilities, projected future taxable income, and tax planning strategies to determine whether all or some portion of the deferred tax assets will not be realized. Forming a conclusion that a valuation allowance is not needed is difficult when there is negative evidence such as cumulative losses in recent years. Using available evidence and judgment, the Company establishes a valuation allowance for deferred tax assets, when it is determined that it is more likely than not that they will not be realized. Valuation allowances have been provided primarily against U.S. federal and state research and development credits and certain acquired net operating losses and deferred tax assets of foreign subsidiaries. A change in the assessment of the realizability of deferred tax assets may significantly affect the Company’s tax provision in the period in which a change of assessment occurs. Taxes due on Global Intangible Low-Taxed Income (“GILTI”) inclusions in U.S. are recognized as a current period expense when incurred.
As a multinational corporation, the Company conducts its business in many countries and is subject to taxation in many jurisdictions. The taxation of the business is subject to the application of various and sometimes conflicting tax laws and regulations as well as multinational tax conventions. The Company’s effective tax rate is highly dependent upon the geographic distribution of the Company’s worldwide earnings or losses, the tax laws and regulations in various jurisdictions, the availability of tax incentives, tax credits and loss carryforwards, and the effectiveness of the Company’s tax planning strategies, including the Company’s estimates of the fair value of its intellectual property. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws themselves are subject to change as a result of changes in fiscal policy, changes in legislation, and the evolution of regulations and court rulings and tax audits. There can be no assurance that the Company will accurately predict the outcome of audits, and the amounts ultimately paid on resolution of audits could be significantly different than the amounts previously included in the Company’s income tax expense and therefore, could have a significant effect on its tax provision, results of operations, and cash flows. Consequently, taxing authorities may impose tax assessments or judgments against us that could significantly affect the Company’s tax liability and/or its effective income tax rate.
The Company is subject to income tax audits by the respective tax authorities in the jurisdictions in which it operates. The Company recognizes the effect of income tax positions only if these positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is more than 50% likely to be realized. Changes in judgment regarding the recognition or measurement of uncertain tax positions are reflected in the period in which the change occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. The calculation of the Company’s tax liabilities involves the inherent uncertainty associated with complex tax laws. The Company believes it has adequately provided for in its financial statements additional taxes that it estimates may be required to be paid as a result of such examinations. While the Company believes that it has adequately provided for all tax positions, amounts asserted by tax authorities could be greater or less than its accrued position. Unpaid tax liabilities, including the interest and penalties, are released pursuant to a final settlement with tax authorities, completion of audit or expiration of various statutes of limitations. The significant jurisdictions in which the Company may be subject to examination by tax authorities throughout the world include Germany, India, Israel, Singapore, and the United States.
The recognition and measurement of current taxes payable or refundable, and deferred tax assets and liabilities require that the Company make certain estimates and judgments. Changes to these estimates or judgments may have a significant effect on the Company’s tax provision in a future period.
Recent Accounting Pronouncements
Accounting Pronouncements Recently Adopted
In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280) to improve reportable segment disclosures. The update requires disclosure of incremental segment information on an annual and interim basis. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and requires retrospective application to all prior periods presented in the financial statements. The Company adopted this standard for the fiscal year ended February 1, 2025. See “Note 14 – Segment and Geographic Information” for further information. The adoption of this standard did not have a significant effect on the Company’s results of operations or financial condition.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Accounting Pronouncements Not Yet Effective
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) to improve income tax disclosures to enhance transparency and decision usefulness of income tax disclosure. The ASU is effective for fiscal years beginning after December 15, 2024 with updates to be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is evaluating the impact that this new standard will have on the Company’s consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) requiring disaggregated disclosure of certain expense captions into specified categories in the notes to financial statements on an annual and interim basis. The ASU is effective for fiscal years beginning after December 15, 2026 with updates to be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is evaluating the impact that this new standard will have on the Company’s consolidated financial statements.
Note 3 — Revenue
Disaggregation of Revenue
The majority of the Company’s revenue is generated from sales of the Company’s products.
The following table summarizes net revenue disaggregated by end market (in millions, except percentages):
| Year Ended February 1, 2025 | % of Total | Year Ended February 3, 2024 | % of Total | Year Ended January 28, 2023 | % of Total | ||||||||||||||||||||||||||||||
| Net revenue by end market: | |||||||||||||||||||||||||||||||||||
| Data center | $ | 4,164.2 | 72 | % | $ | 2,216.7 | 40 | % | $ | 2,408.8 | 41 | % | |||||||||||||||||||||||
| Enterprise networking | 626.4 | 11 | % | 1,228.4 | 22 | % | 1,369.2 | 23 | % | ||||||||||||||||||||||||||
| Carrier infrastructure | 338.2 | 6 | % | 1,051.9 | 19 | % | 1,084.0 | 18 | % | ||||||||||||||||||||||||||
| Consumer | 316.1 | 5 | % | 622.4 | 11 | % | 701.1 | 12 | % | ||||||||||||||||||||||||||
| Automotive/industrial | 322.4 | 6 | % | 388.3 | 8 | % | 356.5 | 6 | % | ||||||||||||||||||||||||||
| $ | 5,767.3 | $ | 5,507.7 | $ | 5,919.6 |
The following table summarizes net revenue disaggregated by primary geographical market based on destination of shipment (in millions, except percentages):
| Year Ended February 1, 2025 | % of Total | Year Ended February 3, 2024 | % of Total | Year Ended January 28, 2023 | % of Total | ||||||||||||||||||||||||||||||||||||||||||
| Net revenue based on destination of shipment: | |||||||||||||||||||||||||||||||||||||||||||||||
| China | $ | 2,507.6 | 43 | % | $ | 2,371.0 | 43 | % | $ | 2,486.3 | 42 | % | |||||||||||||||||||||||||||||||||||
| United States | 956.9 | 17 | % | 795.6 | 14 | % | 690.1 | 12 | % | ||||||||||||||||||||||||||||||||||||||
| Taiwan | 560.7 | 10 | % | 161.9 | 3 | % | 289.0 | 5 | % | ||||||||||||||||||||||||||||||||||||||
| Singapore | 452.2 | 8 | % | 336.2 | 6 | % | 331.7 | 6 | % | ||||||||||||||||||||||||||||||||||||||
| Thailand | 304.4 | 5 | % | 329.2 | 6 | % | 391.9 | 7 | % | ||||||||||||||||||||||||||||||||||||||
| Japan | 166.2 | 3 | % | 169.1 | 3 | % | 260.0 | 4 | % | ||||||||||||||||||||||||||||||||||||||
| Malaysia | 143.1 | 2 | % | 222.6 | 4 | % | 393.2 | 7 | % | ||||||||||||||||||||||||||||||||||||||
| Finland | 112.9 | 2 | % | 380.4 | 7 | % | 189.6 | 3 | % | ||||||||||||||||||||||||||||||||||||||
| Other | 563.3 | 10 | % | 741.7 | 14 | % | 887.8 | 14 | % | ||||||||||||||||||||||||||||||||||||||
| $ | 5,767.3 | $ | 5,507.7 | $ | 5,919.6 | ||||||||||||||||||||||||||||||||||||||||||
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
These destinations of shipment are not necessarily indicative of the geographic location of the Company’s end customers or the country in which the Company’s end customers sell devices containing the Company’s products. For example, a substantial majority of the shipments made to China relate to sales to non-China based customers that have factories or contract manufacturing operations located within China.
The following table summarizes net revenue disaggregated by customer type (in millions, except percentages):
| Year Ended February 1, 2025 | % of Total | Year Ended February 3, 2024 | % of Total | Year Ended January 28, 2023 | % of Total | ||||||||||||||||||||||||||||||
| Net revenue by customer type: | |||||||||||||||||||||||||||||||||||
| Direct customers | $ | 3,309.9 | 57 | % | $ | 3,469.5 | 63 | % | $ | 3,949.6 | 67 | % | |||||||||||||||||||||||
| Distributors | 2,457.4 | 43 | % | 2,038.2 | 37 | % | 1,970.0 | 33 | % | ||||||||||||||||||||||||||
| $ | 5,767.3 | $ | 5,507.7 | $ | 5,919.6 |
Contract Liabilities
Contract liabilities consist of the Company’s obligation to transfer goods or services to a customer for which the Company has received consideration or the amount is due from the customer. Contract liability balances are comprised of deferred revenue. The amount of revenue recognized during the year ended February 1, 2025, that was included in deferred revenue balance at February 3, 2024 was not material.
As of the end of a reporting period, some of the performance obligations associated with contracts will have been unsatisfied or only partially satisfied. The Company has elected the practical expedient and does not disclose the value of unsatisfied performance obligations for contracts with an original expected duration of one year or less.
Customer Warrant
During fiscal 2025, the Company issued a warrant to a customer for the purchase of up to 4.2 million shares (“Warrant Shares”) of the Company’s common stock at an exercise price of $87.77 per share. The warrant has an exercise term of seven years and a vesting term of five years. The Warrant Shares vest primarily based on the customer’s achievement of qualifying product revenue milestones and are recognized as a reduction to revenue as qualifying revenues are recognized during the five year vesting term. The grant date fair value of the Warrant was determined to be $54.44 per share and a total fair value of $227.6 million using the Black-Scholes option pricing model. A total of 0.1 million Warrant Shares were vested as of February 1, 2025.
See “Note 11 – Equity Compensation and Employee Benefit Plans” for additional information.
Sales Commissions
The Company has elected to apply the practical expedient to expense commissions when incurred as the amortization period is typically one year or less. These costs are recorded in selling, general and administrative expenses in the consolidated statements of operations.
Note 4 — Restructuring
The Company continuously evaluates its existing operations to increase operational efficiency, decrease costs and increase profitability.
The following table provides a summary of restructuring related charges as presented in the consolidated statements of operations (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Restructuring related charges included in cost of goods sold | $ | 357.9 | $ | — | $ | — | |||||||||||
| Restructuring related charges included in operating expenses | 353.9 | 131.1 | 21.6 | ||||||||||||||
| Restructuring related charges included in net loss | $ | 711.8 | $ | 131.1 | $ | 21.6 |
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents details related to the restructuring related charges as presented in the consolidated statements of operations (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Employee severance and related costs | $ | 26.3 | $ | 93.9 | $ | 15.5 | |||||||||||
| Impairment and write-off of assets | |||||||||||||||||
| Acquired intangible assets | 240.1 | — | — | ||||||||||||||
| Purchased technology licenses | 159.0 | 28.6 | — | ||||||||||||||
| Inventories | 63.1 | — | — | ||||||||||||||
| Property and equipment | 36.0 | — | — | ||||||||||||||
| Other non-current assets | 25.2 | — | — | ||||||||||||||
| Recognition of future contractual obligations | 114.0 | — | — | ||||||||||||||
| Other | 48.1 | 8.6 | 6.1 | ||||||||||||||
| $ | 711.8 | $ | 131.1 | $ | 21.6 |
Fiscal 2025 Plan. A restructuring plan was initiated during the third quarter of fiscal 2025 (the “Fiscal 2025 Plan”) to increase research and development investment in the data center end market and reduce investment in new product development in other end markets including the cancellation of certain future product releases. As a result, the Company was required to assess the recoverability of related long-lived assets. On completion of the assessment, the Company determined the carrying values of certain long-lived assets were not recoverable. The Company utilized a discounted cash flow method of valuation to determine the fair value of the associated assets and liabilities and compared to their carrying values, which resulted in recognition of asset impairment charges for acquired intangible assets, purchased technology licenses, and property and equipment. The Company’s assumptions included future expected revenues, expenses, capital expenditures and other costs, discount rate, and whether or not alternative uses were available for affected assets.
The Company recognized $702.7 million of total restructuring and other related charges for the year ended February 1, 2025 related to the Fiscal 2025 Plan. Restructuring charges are mainly comprised of impairment and write-off of acquired intangible assets, purchase technology licenses, inventories, property and equipment and other non-current assets, as well as recognition of future contractual obligations, severance, other one-time termination benefits, and other costs. The restructuring charges include $159.0 million impairment of capitalized purchased technology licenses that the Company had ceased use of in the third quarter of fiscal 2025. In addition, the Company recognized $97.8 million of restructuring charges related to payment obligations associated with impaired technology license agreements. See “Note 8 – Commitments and Contingencies” for additional information. The Company expects these restructuring actions to be substantially completed by the end of fiscal 2026.
Fiscal 2024 Plan. A restructuring plan was initiated during the first quarter of fiscal 2024 (the “Fiscal 2024 Plan”) to streamline the organization and optimize resources. Restructuring charges were mainly comprised of severance, other one-time termination benefits, impairment and write-off of purchased technology licenses and equipment, and other costs. The Company recorded restructuring and other related charges of $9.1 million for the year ended February 1, 2025 and $130.8 million for the year ended February 3, 2024 related to the Fiscal 2024 Plan. As of the end of fiscal 2025, substantially all actions relating to the Fiscal 2024 Plan have been completed.
Fiscal 2023 Plan. A restructuring plan was initiated during the first quarter of fiscal 2023 (the “Fiscal 2023 Plan”) in order to realign the organization and enable further investment in key priority areas. Restructuring charges are mainly comprised of severance and other one-time termination benefits, facility closures where sites may be redundant within the same region or no longer suitably sized for the local employee base, and other costs. The Company recorded restructuring and other related charges of $15.8 million for the year ended January 28, 2023 related to the Fiscal 2023 Plan. As of the end of fiscal 2025, substantially all actions relating to the Fiscal 2023 Plan have been completed.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table sets forth a reconciliation of the beginning and ending restructuring liability balances by each major type of costs associated with the restructuring charges (in millions):
| Fiscal 2023 and earlier Restructuring | Fiscal 2024 Restructuring | Fiscal 2025 Restructuring | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Employee Severance and Related Costs | Other Exit Related Costs | Employee Severance and Related Costs | Other Exit Related Costs | Employee Severance and Related Costs | Other Exit Related Costs | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at January 28, 2023 | $ | 3.6 | $ | 1.4 | $ | — | $ | — | $ | — | $ | — | $ | 5.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Charges | — | 0.3 | 93.9 | 36.9 | — | — | 131.1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net cash payments | (3.6) | 2.0 | (78.4) | (24.5) | — | — | (104.5) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Non-cash items | — | (2.9) | — | (11.7) | — | — | (14.6) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at February 3, 2024 | — | 0.8 | 15.5 | 0.7 | — | — | 17.0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Charges (1) | — | — | 6.9 | 2.2 | 19.4 | 156.8 | 185.3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net cash payments | — | (0.8) | (22.4) | (0.7) | (6.5) | (11.4) | (41.8) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Non-cash items (2) | — | — | — | (2.2) | — | 170.8 | 168.6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at February 1, 2025 | — | — | — | — | 12.9 | 316.2 | 329.1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Less: non-current portion | — | — | — | — | — | 228.4 | 228.4 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Current portion | $ | — | $ | — | $ | — | $ | — | $ | 12.9 | $ | 87.8 | $ | 100.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(1)Impairment and other non-cash charges of $526.5 million recognized in fiscal 2025 were recorded directly to the consolidated statements of operations and were not included in the restructuring liability balances above.
(2)Includes recognition of restructuring liabilities for future contractual obligations as a result of the cease use of related assets.
The current portion of the restructuring liability at February 1, 2025 is comprised of $91.5 million and $9.2 million included as components of accrued liabilities and accounts payable, respectively, and the non-current portion of the restructuring liability is included as a component of other non-current liabilities in the accompanying consolidated balance sheets.
Note 5 — Goodwill and Acquired Intangible Assets, Net
Goodwill
Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. There was no activity from acquisitions or divestitures recorded to goodwill in fiscal 2025 and 2024. The carrying value of total goodwill as of February 1, 2025 and February 3, 2024 was $11.6 billion.
The Company has identified that its business operates as a single operating segment and as a single reporting unit for the purpose of goodwill impairment testing. The Company’s annual test for goodwill impairment as of the last day of the fourth quarter of fiscal 2025 did not result in any impairment charge.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Acquired Intangible Assets, Net
As of February 1, 2025 and February 3, 2024, net carrying amounts excluding fully amortized intangible assets are as follows (in millions, except for weighted-average remaining amortization period):
| February 1, 2025 | ||||||||||||||||||||||||||||||||||||||||||||
| Gross Carrying Amounts | Accumulated Amortization and Impairment | Net Carrying Amounts | Weighted-Average Remaining Amortization Period (Years) | |||||||||||||||||||||||||||||||||||||||||
| Developed technologies | $ | 5,162.0 | $ | (3,466.1) | $ | 1,695.9 | 3.6 | |||||||||||||||||||||||||||||||||||||
| Customer contracts and related relationships | 2,039.0 | (1,372.5) | 666.5 | 2.4 | ||||||||||||||||||||||||||||||||||||||||
| Trade names | 50.0 | (37.8) | 12.2 | 1.2 | ||||||||||||||||||||||||||||||||||||||||
| Total acquired amortizable intangible assets | 7,251.0 | (4,876.4) | 2,374.6 | 3.3 | ||||||||||||||||||||||||||||||||||||||||
| In-process research and development | 336.0 | — | 336.0 | n/a | ||||||||||||||||||||||||||||||||||||||||
| Total acquired intangible assets | $ | 7,587.0 | $ | (4,876.4) | $ | 2,710.6 |
The Company regularly assesses the results of its business to determine whether events or circumstances exist that indicate whether the carrying amount of the acquired intangible assets may not be recoverable. During fiscal 2025, impairment charges of $240.1 million related to certain acquired developed technologies intangible assets were recognized as part of restructuring actions. The gross carrying amounts and accumulated amortization of fully impaired intangible assets were excluded from the table above. See “Note 4 – Restructuring” for further information.
| February 3, 2024 | ||||||||||||||||||||||||||
| Gross Carrying Amounts | Accumulated Amortization | Net Carrying Amounts | Weighted-Average Remaining Amortization Period (Years) | |||||||||||||||||||||||
| Developed technologies | $ | 4,989.0 | $ | (2,613.5) | $ | 2,375.5 | 3.8 | |||||||||||||||||||
| Customer contracts and related relationships | 2,179.0 | (1,191.5) | 987.5 | 3.3 | ||||||||||||||||||||||
| Trade names | 50.0 | (27.9) | 22.1 | 2.2 | ||||||||||||||||||||||
| Total acquired amortizable intangible assets | 7,218.0 | (3,832.9) | 3,385.1 | 3.6 | ||||||||||||||||||||||
| In-process research and development | 619.0 | — | 619.0 | n/a | ||||||||||||||||||||||
| Total acquired intangible assets | $ | 7,837.0 | $ | (3,832.9) | $ | 4,004.1 |
The intangible assets are amortized on a straight-line basis over the estimated useful lives, except for certain customer contracts and related relationships, which are amortized using an accelerated method of amortization over the expected customer lives, which more closely align with the pattern of realization of economic benefits expected to be obtained. The in-process research and development (“IPR&D”) will be accounted for as an indefinite-lived intangible asset and will not be amortized until the underlying project reaches technological feasibility and commercial production, at which point, the IPR&D is reclassified as an amortizable acquired intangible asset and amortized over the asset’s estimated useful life. Useful lives for these IPR&D projects are expected to range between 8 to 10 years. In the event the IPR&D is abandoned, the related assets will be written off.
Amortization for acquired intangible assets was $1.1 billion during the years ended February 1, 2025, February 3, 2024 and January 28, 2023.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents the estimated future amortization expense of acquired amortizable intangible assets as of February 1, 2025 (in millions):
| Fiscal Year | Amount | |||||||
| 2026 | $ | 941.7 | ||||||
| 2027 | 811.3 | |||||||
| 2028 | 282.1 | |||||||
| 2029 | 129.0 | |||||||
| 2030 | 106.8 | |||||||
| Thereafter | 103.7 | |||||||
| $ | 2,374.6 |
Note 6 — Fair Value Measurements
Fair value is an exit price representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:
Level 1 — Observable inputs that reflect quoted prices for identical assets or liabilities in active markets.
Level 2 — Other inputs that are directly or indirectly observable in the marketplace.
Level 3 — Unobservable inputs that are supported by little or no market activity.
The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
The Company’s Level 1 assets include marketable equity investments that are classified as other non-current assets and which are valued primarily using quoted market prices. The Company’s Level 2 assets include time deposits, as the market inputs used to value these instruments consist of market yield. In addition, forward contracts and the severance pay fund are classified within Level 2 of the fair value hierarchy as the valuation inputs are based on quoted prices and market observable data of similar instruments.
The tables below set forth, by level, the Company’s assets that are measured at fair value on a recurring basis. The tables do not include assets that are measured at historical cost or any basis other than fair value (in millions):
| Fair Value Measurements at February 1, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Items measured at fair value on a recurring basis: | |||||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Time deposits | $ | — | $ | 57.2 | $ | — | $ | 57.2 | |||||||||||||||
| Prepaid expenses and other current assets: | |||||||||||||||||||||||
| Foreign currency forward contracts | — | 0.5 | — | 0.5 | |||||||||||||||||||
| Other non-current assets: | |||||||||||||||||||||||
| Marketable equity investments | 15.6 | — | — | 15.6 | |||||||||||||||||||
| Severance pay fund | — | 0.6 | — | 0.6 | |||||||||||||||||||
| Total assets | $ | 15.6 | $ | 58.3 | $ | — | $ | 73.9 | |||||||||||||||
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The carrying value of investments in non-marketable equity securities recorded to fair value on a non-recurring basis is adjusted for observable transactions for identical or similar investments of the same issuer or for impairment. These securities relate to equity investments in privately-held companies. These items measured at fair value on a non-recurring basis are classified as Level 3 in the fair value hierarchy because the value is estimated based on valuation methods using the observable transaction price at the transaction date and other unobservable inputs such as volatility, rights and obligations of the securities held. As of February 1, 2025 and February 3, 2024, non-marketable equity investments had a carrying value of $48.2 million and $45.8 million, respectively, and are included in other non-current assets in the Company’s consolidated balance sheets.
| Fair Value Measurements at February 3, 2024 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Items measured at fair value on a recurring basis: | |||||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Time deposits | $ | — | $ | 2.6 | $ | — | $ | 2.6 | |||||||||||||||
| Prepaid expenses and other current assets: | |||||||||||||||||||||||
| Foreign currency forward contracts | — | 1.2 | — | 1.2 | |||||||||||||||||||
| Other non-current assets: | |||||||||||||||||||||||
| Marketable equity investments | 9.3 | — | — | 9.3 | |||||||||||||||||||
| Severance pay fund | — | 0.5 | — | 0.5 | |||||||||||||||||||
| Total assets | $ | 9.3 | $ | 4.3 | $ | — | $ | 13.6 | |||||||||||||||
There were no transfers of assets between levels in either fiscal 2025 or 2024.
Fair Value of Debt
The Company classified the 2026 Term Loan, 2026 Senior Notes, 2028 Senior Notes, 2029 Senior Notes, 2031 Senior Notes, and 2033 Senior Notes as Level 2 in the fair value measurement hierarchy. The carrying value of the 2026 Term Loan approximates its fair value as the 2026 Term Loan is carried at a market observable interest rate that resets periodically. The estimated aggregate fair value of the unsecured senior notes was $3.4 billion at February 1, 2025 and $3.3 billion at February 3, 2024, and were classified as Level 2 as there are quoted prices from less active markets for the notes. See “Note 7 – Debt” for additional information.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 7 — Debt
Summary of Borrowings and Outstanding Debt
The following table summarizes the Company’s outstanding debt at February 1, 2025 and February 3, 2024 (in millions):
| February 1, 2025 | February 3, 2024 | |||||||||||||
| Face Value Outstanding: | ||||||||||||||
| 2026 Term Loan - 5-Year Tranche | $ | 590.6 | $ | 700.0 | ||||||||||
| Term Loan Total | 590.6 | 700.0 | ||||||||||||
| 4.875% MTG/MTI 2028 Senior Notes | 499.9 | 499.9 | ||||||||||||
| 1.650% 2026 Senior Notes | 500.0 | 500.0 | ||||||||||||
| 2.450% 2028 Senior Notes | 750.0 | 750.0 | ||||||||||||
| 5.750% 2029 Senior Notes | 500.0 | 500.0 | ||||||||||||
| 2.950% 2031 Senior Notes | 750.0 | 750.0 | ||||||||||||
| 5.950% 2033 Senior Notes | 500.0 | 500.0 | ||||||||||||
| Senior Notes Total | 3,499.9 | 3,499.9 | ||||||||||||
| Total borrowings | $ | 4,090.5 | $ | 4,199.9 | ||||||||||
| Less: Unamortized debt discount and issuance cost | (26.7) | (34.0) | ||||||||||||
| Net carrying amount of debt | $ | 4,063.8 | $ | 4,165.9 | ||||||||||
| Less: Current portion (1) | 129.5 | 107.3 | ||||||||||||
| Non-current portion | $ | 3,934.3 | $ | 4,058.6 |
(1)As of February 1, 2025, the current portion of outstanding debt that is due within twelve months includes a portion of the 2026 Term Loan - 5-Year Tranche. The weighted-average interest rate on short-term debt outstanding at February 1, 2025 and February 3, 2024 was 5.785% and 6.830%, respectively.
2024 and 2026 Term Loans
On December 7, 2020, the Company entered into a term loan credit agreement with a lending syndicate led by JP Morgan Chase Bank, N.A (the “2024 and 2026 Term Loan Agreement”) in order to finance the acquisition of Inphi Corporation (“Inphi”). The 2024 and 2026 Term Loan Agreement provides for borrowings of $1.8 billion consisting of: (i) $875.0 million loan with a 3-year term from the funding date (the “3-Year Tranche Loan”) and (ii) $875.0 million loan with a 5-year term from the funding date (the “5-Year Tranche Loan” and, together with the 3-Year Tranche Loan, the “2024 and 2026 Term Loans”).
On April 14, 2023, the Company entered into an amendment to the 2024 and 2026 Term Loan Agreement. The amendment modifies the existing agreement to, among other things, adopt Secured Overnight Financing Rate (“SOFR”) interest rates and conform the maximum leverage ratio financial covenant with the amended and restated revolving credit agreement.
The 3-Year Tranche Loan, due on April 19, 2024, which had a remaining principal of $735.0 million, was repaid in full during the quarter ended October 28, 2023.
Pursuant to the amended 2024 and 2026 Term Loan Agreement, the 5-Year Tranche Loan has a stated floating interest rate which equates to adjusted term SOFR + 137.5 bps. The effective interest rate for the 5-Year Tranche Loan was 4.912% as of February 1, 2025. The 5-Year Tranche Loan requires scheduled principal payments at the end of each fiscal quarter equal to (i) 1.25% of the aggregate principal amount on the term funding date for the first four full fiscal quarters following the term loan funding date, (ii) 2.50% of the aggregate principal amount on the term funding date for the fifth through twelfth full fiscal quarters following the term loan funding date, and (iii) 3.75% of the aggregate principal amount on the term funding date for each fiscal quarter following the twelfth full fiscal quarter following the term loan funding date. During the year ended February 1, 2025, the Company repaid $109.4 million of the principal outstanding of the 5-Year Tranche Loan. As of February 1, 2025, the Company has $590.6 million of 5-Year Tranche Loan borrowings outstanding.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The 2024 and 2026 Term Loan Agreement requires that the Company and its subsidiaries comply with covenants relating to customary matters, including with respect to creating or permitting certain liens, entering into sale and leaseback transactions, and consolidating, merging, liquidating or dissolving. It also prohibits subsidiaries of the Company from incurring additional indebtedness, subject to certain exceptions, and requires that the Company maintain a leverage ratio financial covenant as of the end of any fiscal quarter.
2023 Revolving Credit Facility
On December 7, 2020, the Company entered into a revolving line of credit agreement with a lending syndicate led by JP Morgan Chase Bank, N.A for borrowings of up to $750.0 million. On April 14, 2023, the Company entered into an agreement to amend and restate the credit facility to increase the borrowing capacity to $1.0 billion (as so amended and restated, the “2023 Revolving Credit Facility”). The 2023 Revolving Credit Facility has a 5-year term and a stated floating interest rate which equates to an adjusted term SOFR plus an applicable margin. The borrowings from the Revolving Loans will be used for general corporate purposes of the Company. The Company may prepay any borrowings at any time without premium or penalty. An unused commitment fee is payable quarterly based on unused balances at a rate that is based on the ratings of the Company’s senior unsecured long-term indebtedness. This annual rate was 0.175% at February 1, 2025.
As of February 1, 2025, the 2023 Revolving Credit Facility was undrawn and is available for draw down through April 14, 2028.
The 2023 Revolving Credit Facility requires that the Company and its subsidiaries comply with covenants relating to customary matters. The covenants are consistent with the 2024 and 2026 Term Loan Agreement covenants discussed above.
As of February 1, 2025, the Company was in compliance with its debt covenants for the credit agreements discussed above.
2029 and 2033 Senior Unsecured Notes
On September 18, 2023, the Company completed an offering of (i) $500.0 million aggregate principal amount of the Company’s 5.750% Senior Notes due 2029 (the “2029 Senior Notes”) and (ii) $500.0 million aggregate principal amount of the Company’s 5.950% Senior Notes due 2033 (the “2033 Senior Notes”, and, together with the 2029 Senior Notes, the “2029 and 2033 Senior Notes”).
The 2029 Senior Notes have a 5.5-year term and mature on February 15, 2029, and the 2033 Senior Notes have a 10-year term and mature on September 15, 2033. The stated and effective interest rates for the 2029 Senior Notes are 5.750% and 5.891%, respectively. The stated and effective interest rates for the 2033 Senior Notes are 5.950% and 6.082%, respectively. The Company may redeem the 2029 and 2033 Senior Notes, in whole or in part, at any time prior to their maturity at the redemption prices set forth in 2029 and 2033 Senior Notes. In addition, upon the occurrence of a change of control repurchase event (which involves the occurrence of both a change of control and a ratings event involving the 2029 and 2033 Senior Notes being rated below investment grade), the Company will be required to make an offer to repurchase the 2029 and 2033 Senior Notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest to, but excluding, the repurchase date. The indenture governing the 2029 and 2033 Senior Notes also contains certain limited covenants restricting the Company’s ability to incur certain liens, enter into certain sale and leaseback transactions and merge or consolidate with any other entity or convey, transfer or lease all or substantially all of the Company’s properties or assets to another person, which, in each case, are subject to certain qualifications and exceptions. As of February 1, 2025, the Company had $1.0 billion borrowings outstanding from 2029 and 2033 Senior Notes.
2026, 2028 and 2031 Senior Unsecured Notes
On April 12, 2021, the Company completed an offering of (i) $500.0 million aggregate principal amount of the Company’s 1.650% Senior Notes due 2026 (the “2026 Senior Notes”), (ii) $750.0 million aggregate principal amount of the Company’s 2.450% Senior Notes due 2028 (the “2028 Senior Notes”) and (iii) $750.0 million aggregate principal amount of the Company’s 2.950% Senior Notes due 2031 (the “2031 Senior Notes”, and, together with the 2026 Senior Notes and the 2028 Senior Notes, the “2026, 2028 and 2031 Senior Notes”). On October 8, 2021, the 2026, 2028 and 2031 Senior Notes issued on April 12, 2021 were exchanged for new notes. The terms of the new notes issued in the exchange are substantially identical to the notes issued in April 2021, except that the new notes are registered under the Securities Act of 1933, as amended (the “Securities Act”) and the transfer restrictions and registration rights applicable to the 2026, 2028 and 2031 Senior Notes issued in April 2021 do not apply to the new notes.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The 2026 Senior Notes have a 5-year term and mature on April 15, 2026, the 2028 Senior Notes have a 7-year term and mature on April 15, 2028, and the 2031 Senior Notes have a 10-year term and mature on April 15, 2031. The stated and effective interest rates for the 2026 Senior Notes are 1.650% and 1.839%, respectively. The stated and effective interest rates for the 2028 Senior Notes are 2.450% and 2.554%, respectively. The stated and effective interest rates for the 2031 Senior Notes are 2.950% and 3.043%, respectively. The Company may redeem the 2026, 2028 and 2031 Senior Notes, in whole or in part, at any time prior to their respective maturity at the redemption prices set forth in the indenture governing the 2026, 2028 and 2031 Senior Notes. In addition, upon the occurrence of a change of control repurchase event (which involves the occurrence of both a change of control and a ratings event involving the 2026, 2028 and 2031 Senior Notes being rated below investment grade), the Company will be required to make an offer to repurchase the 2026, 2028 and 2031 Senior Notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest to, but excluding, the repurchase date. The indenture governing the 2026, 2028 and 2031 Senior Notes also contains certain limited covenants restricting the Company’s ability to incur certain liens, enter into certain sale and leaseback transactions and merge or consolidate with any other entity or convey, transfer or lease all or substantially all of the Company’s properties or assets to another person, which, in each case, are subject to certain qualifications and exceptions. As of February 1, 2025, the Company had $2.0 billion borrowings outstanding from 2026, 2028 and 2031 Senior Notes.
2023 and 2028 Senior Unsecured Notes
On June 22, 2018, the Company’s Bermuda-based parent company Marvell Technology Group, Ltd. (“MTG”) completed a public offering of (i) $500.0 million aggregate principal amount of 4.200% Senior Notes due 2023 (the “MTG 2023 Notes”) and (ii) $500.0 million aggregate principal amount of 4.875% Senior Notes due 2028 (the “MTG 2028 Notes” and, together with the MTG 2023 Notes, the “MTG Senior Notes”).
In April 2021, in conjunction with the Company’s U.S. domiciliation, the Company commenced Exchange Offers on April 19, 2021 for the outstanding $1.0 billion in aggregate principal amount of the MTG Senior Notes outstanding in exchange for corresponding senior notes to be issued by the Company’s U.S. domiciled parent MTI. MTI made an offer to (i) exchange any and all of the outstanding MTG 2023 Notes for up to an aggregate principal amount of $500.0 million of new 4.200% Senior Notes due 2023 issued by MTI (the “MTI 2023 Notes”) and to (ii) exchange any and all of the outstanding MTG 2028 Notes for up to an aggregate principal amount of $500.0 million of new 4.875% Senior Notes due 2028 issued by MTI (the “MTI 2028 Notes” and, together with the MTI 2023 Notes, the “MTI Senior Notes”). Each new series of MTI Senior Notes have the same interest rate, maturity date, redemption terms and interest payment dates and are subject to substantially similar covenants as the corresponding series of the MTG Senior Notes for which they were offered in exchange.
The settlement of the Exchange Offers occurred on May 4, 2021 with $433.9 million aggregate principal amount of the MTG 2023 Notes and $479.5 million aggregate principal amount of the MTG 2028 Notes. The exchange was accounted for as a debt modification in accordance with applicable accounting guidance. On December 16, 2021, the MTI Senior Notes issued on May 4, 2021 were exchanged for new notes. The terms of the new notes issued in the exchange are substantially identical to the notes issued in May 2021, except that the new notes are registered under the Securities Act and the transfer restrictions and registration rights applicable to the MTI Senior Notes issued in May 2021 do not apply to the new notes.
The MTI 2023 Notes and MTG 2023 Notes with aggregate principal of $500.0 million matured on June 22, 2023 and was repaid.
The MTI 2028 Notes mature on June 22, 2028. The stated and effective interest rates for the MTI 2028 Notes are 4.875% and 4.988%, respectively. The Company may redeem the MTI Senior Notes, in whole or in part, at any time prior to their maturity at the redemption prices set forth in MTI Senior Notes. In addition, upon the occurrence of a change of control repurchase event (which involves the occurrence of both a change of control and a ratings event involving the MTI Senior Notes being rated below investment grade), the Company will be required to make an offer to repurchase the MTI Senior Notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest to, but excluding, the repurchase date. The indenture governing the MTI Senior Notes also contains certain limited covenants restricting the Company’s ability to incur certain liens, enter into certain sale and leaseback transactions and merge or consolidate with any other entity or convey, transfer or lease all or substantially all of the Company’s properties or assets to another person, which, in each case, are subject to certain qualifications and exceptions.
The MTG 2028 Notes mature on June 22, 2028. The stated and effective interest rates for the MTG 2028 Notes are 4.875% and 4.940%, respectively. The Company may redeem the MTG Senior Notes, in whole or in part, at any time prior to their maturity at the redemption prices set forth in MTG Senior Notes.
As of February 1, 2025, the Company had $499.9 million borrowings outstanding from MTI 2028 Notes and MTG 2028 Notes.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Interest Expense and Future Contractual Maturities
During fiscal 2025, 2024, and 2023, the Company recognized $183.0 million, $202.9 million, and $159.6 million of interest expense, respectively, in its consolidated statements of operations related to interest, amortization of debt issuance costs and accretion of discount associated with the outstanding debt.
As of February 1, 2025, the aggregate future contractual maturities of the Company’s outstanding debt, at face value, were as follows (in millions):
| Fiscal Year | Amount | |||||||
| 2026 | $ | 131.2 | ||||||
| 2027 | 959.4 | |||||||
| 2028 | — | |||||||
| 2029 | 1,249.9 | |||||||
| 2030 | 500.0 | |||||||
| Thereafter | 1,250.0 | |||||||
| Total | $ | 4,090.5 |
Note 8 — Commitments and Contingencies
Warranty Obligations
The Company generally warrants that its products sold to its customers will conform to its approved specifications and be free from defects in material and workmanship under normal use and conditions for one year. The Company may offer a longer warranty period in limited situations based on product type and negotiated warranty terms with certain customers.
Commitments
The Company’s commitments primarily consist of wafer purchase obligations with foundry partners, supply capacity reservation payment commitments with foundries and test and assembly partners, technology license fee obligations, and minimum purchase commitments under technology service agreements.
Total future unconditional purchase commitments as of February 1, 2025, are as follows (in millions):
| Fiscal Year | Purchase Commitments to Foundries and Test and Assembly Partners | Technology Services and License Fees | ||||||||||||
| 2026 | $ | 1,021.9 | $ | 192.5 | ||||||||||
| 2027 | 156.0 | 155.1 | ||||||||||||
| 2028 | 105.3 | 163.5 | ||||||||||||
| 2029 | 106.5 | 121.3 | ||||||||||||
| 2030 | 66.3 | 111.7 | ||||||||||||
| Thereafter | 182.4 | 77.3 | ||||||||||||
| Total unconditional purchase commitments | $ | 1,638.4 | $ | 821.4 | ||||||||||
Technology license fees include the liabilities under agreements for technology licenses between the Company and various vendors.
Under the Company’s manufacturing relationships with its foundry partners, cancellation of outstanding purchase orders is allowed but requires payment of all costs and expenses incurred through the date of cancellation, and in some cases, may result in incremental fees, loss of amounts paid in advance, or loss of priority to reserved capacity for a period of time.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The Company entered into manufacturing supply capacity reservation agreements with foundries and test & assembly suppliers during the current and prior fiscal years. Under these arrangements, the Company agreed to pay capacity fees or refundable deposits to the suppliers in exchange for reserved manufacturing production capacity over the term of the agreements, which ranges from 4 to 10 years. In addition, the Company committed to certain purchase levels that were in line with the capacity reserved. During the first and second quarters of fiscal 2025, the Company worked with its foundry and test and assembly suppliers to amend certain manufacturing supply capacity reservation agreements, which resulted in reducing the Company’s related purchase level commitments. The Company currently estimates that it has agreed to purchase level commitments of at least $544.6 million of wafers, substrates, and other manufacturing products for fiscal 2026 through fiscal 2033 under the capacity reservation agreements. In addition, total fees and refundable deposits payable under these arrangements are $47.1 million in fiscal 2026 through fiscal 2028. Such purchase commitments are summarized in the preceding table.
In September 2021, the Company entered into a technology licensing agreement with a vendor which provided complete access to the vendor’s intellectual property portfolio for 10 years. The arrangement provided access to intellectual property over the term of the contract, including existing intellectual property, as well as intellectual property in development, and to be developed in the future. The contract provided support and maintenance over the term of the contract as well. In the third quarter of fiscal 2025, the Company ceased use of this arrangement due to restructuring actions taken during the quarter, resulting in recognition of asset impairment charges. See “Note 4 – Restructuring” for further information. Aggregate remaining fees of $268.5 million as of the cease use date are payable quarterly over the contract term.
Contingencies and Legal Proceedings
The Company currently is, and may from time to time become, subject to claims, lawsuits, governmental inquiries, inspections or investigations and other legal proceedings (collectively, “Legal Matters”) arising in the course of its business. Such Legal Matters, even if not meritorious, could result in the expenditure of significant financial and managerial resources.
During the third quarter of fiscal 2023, the Company entered into a settlement agreement with a customer in relation to a contractual dispute pursuant to which the Company agreed to pay the customer $100.0 million over several quarters. The amount has been paid in full.
As of the end of fiscal 2024, the Company recognized charges of $251.0 million in the aggregate for product related claims, including amounts recognized in previous quarters. Such claims were fully resolved in the fourth quarter of fiscal 2024.
In the third quarter of fiscal 2025, the Company reserved $50.0 million in relation to a contractual disagreement with a customer that was influenced by the restructuring actions initiated by the Fiscal 2025 Plan. See “Note 4 – Restructuring” for additional information. Subsequent to fiscal 2025 year end, the Company reached an agreement with the customer to resolve the matter, in an amount that was not materially different than previously estimated, as reflected in the accompanying fiscal 2025 consolidated financial statements accordingly.
The Company is currently unable to predict the final outcome of its pending Legal Matters and therefore cannot determine the likelihood of loss or estimate a range of possible loss, except with respect to amounts where it has determined a loss is both probable and estimable and has made an accrual. The Company evaluates, at least on a quarterly basis, developments in its Legal Matters that could affect the amount of any accrual, as well as any developments that would result in a loss contingency to become both probable and reasonably estimable. The ultimate outcome of its pending Legal Matters involves judgments, estimates and inherent uncertainties. An unfavorable outcome in a Legal Matter could require the Company to pay damages or could prevent the Company from selling some of its products in certain jurisdictions. While the Company cannot predict with certainty the results of the Legal Matters in which it is currently involved, the Company does not expect that the ultimate costs to resolve these Legal Matters will individually or in the aggregate have a material adverse effect on its financial condition, however, there can be no assurance that the current or any future Legal Matters will be resolved in a manner that is not adverse to the Company’s business, financial statements, results of operations or cash flows.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Indemnities, Commitments and Guarantees
During its normal course of business, the Company has made certain indemnities, commitments and guarantees under which it may be required to make payments in relation to certain transactions. These indemnities may include indemnities for general commercial obligations, indemnities to various lessors in connection with facility leases for certain claims arising from such facility or lease, and indemnities to directors and officers of the Company to the maximum extent permitted under the laws of Delaware. In addition, the Company has contractual commitments to various customers, which could require the Company to incur costs to repair an epidemic defect with respect to its products outside of the normal warranty period if such defect were to occur. The duration of these indemnities, commitments and guarantees varies, and in certain cases, is indefinite. Some of these indemnities, commitments and guarantees do not provide for any limitation of the maximum potential future payments that the Company could be obligated to make. In general, the Company does not record any liability for these indemnities, commitments and guarantees in the accompanying consolidated balance sheets as the amounts cannot be reasonably estimated and are not considered probable. The Company does, however, accrue for losses for any known contingent liability, including those that may arise from indemnification provisions, when future payment is probable and estimable.
Intellectual Property Indemnification
In addition to the above indemnities, the Company has agreed to indemnify certain customers for claims made against the Company’s products where such claims allege infringement of third-party intellectual property rights, including, but not limited to, patents, registered trademarks, and/or copyrights. Under the aforementioned indemnification clauses, the Company may be obligated to defend the customer and pay for the damages awarded against the customer as well as the attorneys’ fees and costs under an infringement claim. The Company’s indemnification obligations generally do not expire after termination or expiration of the agreement containing the indemnification obligation. Generally, but not always, there are limits on and exceptions to the Company’s potential liability for indemnification. Historically the Company has not made significant payments under these indemnification obligations and the Company cannot estimate the amount of potential future payments, if any, that it might be required to make as a result of these agreements. The maximum potential amount of any future payments that the Company could be required to make under these indemnification obligations could be significant.
Note 9 — Leases
The Company’s leases primarily include facility leases and hosting/data center leases, which are all classified as operating leases. For hosting/data center leases, the Company elected the practical expedient to account for the lease and non-lease component as a single lease component.
Lease expense and supplemental cash flow information are as follows (in millions):
| Year Ended | ||||||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | ||||||||||||||||||
| Operating lease expense | $ | 58.2 | $ | 62.0 | $ | 49.6 | ||||||||||||||
| Cash paid for amounts included in the measurement of operating lease liabilities | $ | 49.7 | $ | 53.5 | $ | 41.9 | ||||||||||||||
| Right-of-use assets obtained in exchange for lease obligations | $ | 80.9 | $ | 34.1 | $ | 107.7 |
The effect of operating lease right-of-use asset amortization of $34.3 million, $37.2 million and $32.5 million is included in changes in Other expense, net in the cash provided by operating activities section on the consolidated statements of cash flows for the years ended February 1, 2025, February 3, 2024, and January 28, 2023, respectively.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The aggregate future lease payments for operating leases as of February 1, 2025 are as follows (in millions):
| Fiscal Year | Operating Leases | Sublease Income | ||||||||||||
| 2026 | $ | 57.7 | $ | 5.7 | ||||||||||
| 2027 | 54.2 | 5.9 | ||||||||||||
| 2028 | 46.3 | 4.1 | ||||||||||||
| 2029 | 36.5 | 2.2 | ||||||||||||
| 2030 | 35.3 | 2.3 | ||||||||||||
| Thereafter | 98.4 | 1.8 | ||||||||||||
| Total lease payments | 328.4 | 22.0 | ||||||||||||
| Less: imputed interest | 49.1 | |||||||||||||
| Present value of lease liabilities | $ | 279.3 |
Average lease terms and discount rates were as follows:
| February 1, 2025 | February 3, 2024 | |||||||||||||
| Weighted-average remaining lease term (years) | 7.0 | 7.3 | ||||||||||||
| Weighted-average discount rate | 4.6 | % | 4.0 | % |
Note 10 — Stockholders’ Equity
Preferred and Common Stock
Under the terms of the Company’s Certificate of Incorporation, the Board of Directors may determine the rights, preferences, and terms of the Company’s authorized but unissued shares of preferred stock.
As of February 1, 2025, the Company is authorized to issue 8.0 million shares of $0.002 par value preferred stock and 1.3 billion shares of $0.002 par value common stock. As of February 1, 2025 and February 3, 2024, no shares of preferred stock were outstanding.
Restricted Stock
In connection with an acquisition in fiscal 2023, the Company granted 0.4 million shares of unregistered restricted stock, which is subject to certain vesting conditions.
Restricted Stock Unit Withholdings
For the years ended February 1, 2025, February 3, 2024, and January 28, 2023, the Company withheld approximately 3.3 million, 4.3 million and 4.2 million shares, or $274.9 million, $223.7 million, and $227.6 million of common stock, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock.
Cash Dividends on Shares of Common Stock
During fiscal 2025, the Company declared and paid cash dividends of $0.24 per common stock, or $207.5 million, on the Company’s outstanding common stock. During fiscal 2024, the Company declared and paid cash dividends of $0.24 per common stock, or $206.8 million, on the Company’s outstanding common stock. During fiscal 2023, the Company declared and paid cash dividends of $0.24 per common stock, or $204.4 million, on the Company’s outstanding common stock.
Any future dividends will be subject to the approval of the Company’s Board of Directors.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Stock Repurchase Program
On November 17, 2016, the Company announced that its Board of Directors authorized a $1.0 billion stock repurchase program with no fixed expiration. The stock repurchase program replaced in its entirety the prior $3.3 billion stock repurchase program. On October 16, 2018, the Company announced that its Board of Directors authorized a $700.0 million addition to the balance of its existing stock repurchase program. On March 7, 2024, the Company announced that its Board of Directors authorized a $3.0 billion addition to the balance of its existing stock repurchase program. The Company intends to effect stock repurchases in accordance with the conditions of Rule 10b-18 under the Exchange Act, but may also make repurchases in the open market outside of Rule 10b-18 or in privately negotiated transactions. The stock repurchase program is subject to market conditions, legal rules and regulations, and other factors, and does not obligate the Company to repurchase any dollar amount or number of shares of its common stock and the repurchase program may be extended, modified, suspended or discontinued at any time.
The Company repurchased 9.0 million shares of its common stock for $725.0 million during fiscal 2025, 2.5 million shares of its common stock for $150.0 million during fiscal 2024 and 2.3 million shares of its common stock for $115.0 million during fiscal 2023. The repurchased shares of stock were retired immediately after the repurchases were completed. The Company records all repurchases, as well as investment purchases and sales, based on their trade date. As of February 1, 2025, a total of 321.9 million shares of stock have been repurchased to date under the Company’s stock repurchase program for a total $5.3 billion in cash and there was $2.6 billion remaining available for future stock repurchases.
Subsequent to fiscal 2025 year end through March 11, 2025, the Company repurchased 0.7 million shares of its common stock for $45.0 million.
A summary of the stock repurchase activity under the stock repurchase program, reported based on the trade date, is summarized as follows (in millions, except per share amounts):
| Shares Repurchased | Weighted- Average Price per Share | Amount Repurchased | |||||||||||||||
| Cumulative balance at January 29, 2022 | 308.1 | $ | 13.86 | $ | 4,270.0 | ||||||||||||
| Repurchase of common stock under the stock repurchase program | 2.3 | $ | 49.93 | 115.0 | |||||||||||||
| Cumulative balance at January 28, 2023 | 310.4 | $ | 14.12 | 4,385.0 | |||||||||||||
| Repurchase of common stock under the stock repurchase program | 2.5 | $ | 61.51 | 150.0 | |||||||||||||
| Cumulative balance at February 3, 2024 | 312.9 | $ | 14.49 | 4,535.0 | |||||||||||||
| Repurchase of common stock under the stock repurchase program | 9.0 | $ | 80.47 | 725.0 | |||||||||||||
| Cumulative balance at February 1, 2025 | 321.9 | $ | 16.34 | $ | 5,260.0 |
Note 11 — Equity Compensation and Employee Benefit Plans
Employee Stock Compensation Plans
1995 Stock Option Plan
In April 1995, the Company adopted the 1995 Stock Option Plan (the “Option Plan”). The Option Plan, as amended from time to time, had 383.4 million shares of common stock reserved for issuance thereunder as of February 1, 2025. As of February 1, 2025, approximately 46.0 million shares remained available for future grants under the Option Plan. Under the Option Plan, the Company may issue restricted stock unit (“RSU”) awards, performance-based restricted stock unit (“PRSU”) awards, stock options, and other types of stock awards, all of which may be subject to vesting over a specified service term, generally three to four years.
RSUs granted under the Option Plan include time-based RSUs and PRSUs. Time-based RSUs generally vest over a three to four-year service period. The Company grants PRSUs that vest based on the achievement of performance metrics, which can be financial performance, non-financial performance, and/or market conditions, including, but not limited to, the Company’s relative total shareholder return, earnings per share growth, and stock price performance. PRSU awards reflect a target number of shares, and the actual number of shares may range from 0% to 250% based on the achievement of the performance metrics specified. In addition to achievement of performance and/or market conditions, PRSUs generally have a three to five year service requirement.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Options granted under the Option Plan generally have a term of 10 years and must be issued at prices equal to the fair market value of the stock on the date of grant. Options generally vest over a three to four-year service period.
In December 2017, the Company’s Executive Compensation Committee approved a deferred stock program, whereby executives of the Company have the option, beginning in 2018, to defer the settlement of time-based and performance-based restricted stock units granted under the Option Plan to a future date. In June 2021, the Company extended the stock deferral program to members of the Board of Directors. A deferral election is irrevocable after the annual submission deadline. The shares of common stock underlying the deferred grants will be distributed at the earliest of the employee’s specified future settlement date or upon separation from service, a change in control, or death or disability.
Outside Director Equity Compensation Policy
In September 2016, the Company’s Board of Directors approved an Outside Director Equity Compensation Policy that governs the grant of equity awards to non-employee directors under the Option Plan. Under the current Outside Director Compensation Policy, each outside director, upon appointment to fill a vacancy on the board or in connection with election at an annual meeting of stockholders, will be granted an RSU award under the Option Plan. The RSU award vests 100% on the earlier of the date of the next annual meeting of stockholders or the one-year anniversary of the date of grant.
Assumed Employee Stock Compensation Plans
In connection with past acquisitions, the Company assumed equity incentive plans of certain acquired companies (collectively “the Assumed Plans”), and the equity awards assumed in connection with each acquisition were granted from their respective assumed plans. The assumed equity awards will be settled in shares of the Company’s common stock and will retain the terms and conditions under which they were originally granted. No additional equity awards will be granted under the Assumed Plans.
Employee Stock Purchase Plan
Under the 2000 Employee Stock Purchase Plan, as amended and restated on June 23, 2022 (the “ESPP”), participants purchase the Company’s common stock using payroll deductions, which may not exceed 15% of their total cash compensation. The ESPP provides for a 24-month offering period, with four six-month purchase periods. Participants are granted the right to purchase common stock at a price per share that is 85% of the lesser of the fair market value of the common stock at (i) the participant’s enrollment date into the two-year offering period or (ii) the end of each six-month purchase period within the offering period.
Under the ESPP, a total of 2.3 million shares were issued in fiscal 2025 at a weighted-average price of $36.34 per share, a total of 2.4 million shares were issued in fiscal 2024 at a weighted-average price of $35.57 per share, and a total of 2.3 million shares were issued in fiscal 2023 at a weighted-average price of $37.52 per share. As of February 1, 2025, there was $68.3 million of unamortized compensation expense related to the ESPP.
As of February 1, 2025, approximately 39.2 million shares remained available for future issuance under the ESPP.
Summary of Stock-Based Compensation Expense
The following table summarizes stock-based compensation expense (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Cost of goods sold | $ | 47.3 | $ | 49.1 | $ | 43.3 | |||||||||||
| Research and development | 395.6 | 411.1 | 372.4 | ||||||||||||||
| Selling, general and administrative | 154.5 | 149.6 | 136.7 | ||||||||||||||
| Total stock-based compensation | $ | 597.4 | $ | 609.8 | $ | 552.4 |
The income tax benefit recognized from stock-based compensation expense was $92.2 million, $95.3 million and $89.9 million for the years ended February 1, 2025, February 3, 2024 and January 28, 2023, respectively. Stock-based compensation capitalized in inventory was $16.6 million at February 1, 2025, $18.2 million at February 3, 2024 and $20.3 million at January 28, 2023.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The income tax benefit related to equity awards vested or exercised was $58.5 million, $24.3 million and $21.7 million during the years ended February 1, 2025, February 3, 2024 and January 28, 2023, respectively.
Restricted Stock and Stock Unit Awards
A summary of restricted stock and stock unit activity for time-based and performance-based awards is as follows (in millions, except per share amounts):
| Time-Based | Performance-Based | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Number of Shares | Weighted-Average Grant Date Fair Value | Number of Shares | Weighted-Average Grant Date Fair Value | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Unvested Balance at February 3, 2024 | 16.2 | $ | 46.36 | 4.6 | $ | 44.17 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Granted | 7.3 | $ | 69.93 | 1.2 | $ | 72.61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Vested | (9.7) | $ | 50.84 | (0.5) | $ | 56.14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Canceled/Forfeited | (1.4) | $ | 51.49 | (0.1) | $ | 54.64 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Unvested Balance at February 1, 2025 | 12.4 | $ | 56.17 | 5.2 | $ | 49.19 |
The aggregate intrinsic value of RSUs vested and expected to vest as of February 1, 2025 was $1.4 billion. The weighted-average grant date fair value for RSUs granted was $69.93, $41.50 and $55.73 for the years ended February 1, 2025, February 3, 2024 and January 28, 2023, respectively. The total fair value of RSUs vested during the years ended February 1, 2025, February 3, 2024 and January 28, 2023 was $491.6 million, $523.7 million and $519.6 million, respectively. As of February 1, 2025, unamortized compensation expense related to RSUs was $658.7 million, which is expected to be recognized over a weighted-average period of 1.8 years.
The aggregate intrinsic value of PRSUs vested and expected to vest as of February 1, 2025 was $576.0 million. The weighted-average grant date fair value for PRSUs granted was $72.61, $37.78 and $45.40 for the years ended February 1, 2025, February 3, 2024 and January 28, 2023, respectively. The total fair value of PRSUs vested during the years ended February 1, 2025, February 3, 2024 and January 28, 2023 was $28.6 million, $56.0 million and $38.5 million, respectively. As of February 1, 2025, unamortized compensation expense related to PRSUs was $143.1 million, which is expected to be recognized over a weighted-average period of 1.5 years.
Warrant Shares
During fiscal 2025, the Company issued a warrant to a customer for the purchase of up to 4.2 million shares (“Warrant Shares”) of the Company’s common stock at an exercise price of $87.77 per share. The warrant has an exercise term of 7 years and a vesting term of 5 years. See “Note 3 – Revenue” for additional information.
Activity for the Warrant Shares is as follows (in millions):
| Number of Shares | ||||||||||||||||||||||||||
| Balance outstanding at February 3, 2024 | — | |||||||||||||||||||||||||
| Granted | 4.2 | |||||||||||||||||||||||||
| Vested | (0.1) | |||||||||||||||||||||||||
| Balance outstanding at February 1, 2025 | 4.1 | |||||||||||||||||||||||||
A total of 0.1 million Warrant Shares were vested as of February 1, 2025.
Valuation of Stock-Based Awards
The expected volatility for awards granted during fiscal 2025, 2024 and 2023 was based on historical stock price volatility.
The expected dividend yield is calculated by dividing the current annualized dividend by the closing stock price on the date of grant of the option or award.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following weighted-average assumptions were used for each respective period to calculate the fair value of common stock to be issued under the ESPP on the date of grant using the Black-Scholes option pricing model:
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Employee Stock Purchase Plan: | |||||||||||||||||
| Estimated fair value | $ | 38.68 | $ | 21.44 | $ | 17.42 | |||||||||||
| Expected volatility | 54 | % | 55 | % | 58 | % | |||||||||||
| Expected term (in years) | 1.2 | 1.3 | 1.3 | ||||||||||||||
| Risk-free interest rate | 4.3 | % | 5.0 | % | 4.1 | % | |||||||||||
| Expected dividend yield | 0.2 | % | 0.4 | % | 0.6 | % |
The following weighted-average assumptions were used for each respective period to calculate the fair value of common stock to be issued under PRSU awards on the date of grant using the Monte Carlo pricing model:
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| PRSUs: | |||||||||||||||||
| Expected term (in years) | 3.0 | 3.5 | 3.0 | ||||||||||||||
| Expected volatility | 54 | % | 50 | % | 51 | % | |||||||||||
| Average correlation coefficient of peer companies | 0.7 | 0.7 | 0.7 | ||||||||||||||
| Risk-free interest rate | 4.6 | % | 3.7 | % | 3.3 | % | |||||||||||
| Expected dividend yield | 0.3 | % | 0.6 | % | 0.5 | % |
The correlation coefficients are calculated based upon the price data used to calculate the historical volatilities and is used to model the way in which each entity tends to move in relation to its peers.
The following assumptions were used for each respective period to calculate the fair value of Warrant Shares on the date of grant using the Black-Scholes option pricing model:
| Year Ended February 1, 2025 | ||||||||
| Warrant Shares: | ||||||||
| Estimated fair value | $ | 54.44 | ||||||
| Expected volatility | 48 | % | ||||||
| Expected term (in years) | 7.0 | |||||||
| Risk-free interest rate | 4.1 | % | ||||||
| Expected dividend yield | 0.3 | % |
Employee 401(k) Plans
The Company sponsors a 401(k) savings and investment plan that allows eligible U.S. employees to participate by making pre-tax, Roth and after-tax contributions to the 401(k) plan ranging from 1% to 75% of eligible earnings subject to a required annual limit. The Company currently matches 100% of 5% of eligible salary to a $5,000 maximum contribution effective from January 1, 2023. The Company made matching contributions to employees of $14.7 million in fiscal 2025, $15.5 million in fiscal 2024 and $15.9 million in fiscal 2023. As of February 1, 2025, the 401(k) plan offers a variety of investment alternatives, representing different asset classes. Employees may not invest in the Company’s common stock through the 401(k) plan.
The Company also has voluntary defined contribution plans in various non-U.S. locations. In connection with these plans, the Company made contributions on behalf of employees totaling $11.0 million, $11.4 million and $11.3 million during fiscal 2025, 2024 and 2023, respectively.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 12 — Income Taxes
The U.S. and non-U.S. components of income (loss) from continuing operations before income taxes consist of the following (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| U.S. operations | $ | (402.2) | $ | (383.3) | $ | (452.7) | |||||||||||
| Non-U.S. operations | (492.5) | (375.4) | 537.8 | ||||||||||||||
| Income (loss) before income taxes | $ | (894.7) | $ | (758.7) | $ | 85.1 |
The provision (benefit) for income taxes consists of the following (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Current income tax provision (benefit): | |||||||||||||||||
| Federal | $ | 30.9 | $ | (1.0) | $ | 57.8 | |||||||||||
| State | 0.5 | (2.1) | 3.3 | ||||||||||||||
| Foreign | 70.8 | 27.0 | 137.1 | ||||||||||||||
| Total current income tax provision | 102.2 | 23.9 | 198.2 | ||||||||||||||
| Deferred income tax provision (benefit): | |||||||||||||||||
| Federal | (34.5) | 186.9 | (118.8) | ||||||||||||||
| State | (2.4) | 4.7 | (17.5) | ||||||||||||||
| Foreign | (75.0) | (40.8) | 186.7 | ||||||||||||||
| Total deferred income tax provision (benefit) | (111.9) | 150.8 | 50.4 | ||||||||||||||
| Total provision (benefit) for income taxes | $ | (9.7) | $ | 174.7 | $ | 248.6 |
The income tax expense (benefit) differs from the amount computed by applying the U.S. federal statutory rate of 21% to income (loss) before income taxes as follows (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Provision (benefit) at U.S. statutory rate | $ | (187.9) | $ | (159.3) | $ | 17.9 | |||||||||||
| State taxes, net of federal benefit | (2.0) | 2.5 | (13.8) | ||||||||||||||
| Difference in U.S. and non-U.S. tax rates | 98.2 | 69.5 | (16.0) | ||||||||||||||
| Foreign income inclusion in U.S. | 159.7 | 220.0 | 194.4 | ||||||||||||||
| Change in federal valuation allowance | 36.9 | 92.4 | (73.8) | ||||||||||||||
| Federal research and development credits | (102.8) | (88.0) | (96.1) | ||||||||||||||
| Stock-based compensation | (36.1) | (0.5) | (2.0) | ||||||||||||||
| Non-deductible compensation | 17.1 | 15.8 | 15.1 | ||||||||||||||
| Intellectual property transaction | — | 15.3 | — | ||||||||||||||
| Uncertain tax positions | 2.7 | 1.0 | (16.5) | ||||||||||||||
| Federal tax attribute expiration | — | — | 5.8 | ||||||||||||||
| Singapore incentive rate extension | — | — | 213.6 | ||||||||||||||
| Transaction costs | — | — | 0.4 | ||||||||||||||
| Israel income tax recapture | — | — | 18.3 | ||||||||||||||
| Other | 4.5 | 6.0 | 1.3 | ||||||||||||||
| Total provision (benefit) for income taxes | $ | (9.7) | $ | 174.7 | $ | 248.6 | |||||||||||
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The income tax benefit for fiscal 2025 differs from the U.S. federal statutory rate of 21% as a result of foreign income inclusions in the U.S., a portion of the Company’s earnings or losses being taxed or benefited at rates lower than the U.S. statutory rate, research and development credit generation, and deductions related to stock compensation.
The income tax expense for fiscal 2024 differs from the U.S. federal statutory rate of 21% as a result of foreign income inclusions in the U.S., a portion of the Company’s earnings or losses being taxed or benefited at rates lower than the U.S. statutory rate, research and development credit generation, and disallowed deductions related to non-deductible compensation. Further, during fiscal 2024, guidance was issued by the U.S. Internal Revenue Service in connection with the capitalization of research and development expenditures. As a result of this guidance, certain costs are currently deductible rather than capitalizable, which resulted in a reduction to the Company’s income tax payable and an increase in its deferred tax assets for which the Company maintains a full valuation allowance.
The income tax expense for fiscal 2023 differs from the U.S. federal statutory rate of 21% primarily due to the remeasurement of Singapore deferred taxes upon extension of the Company’s tax incentive in Singapore, tax benefits attributable to a net reduction of unrecognized tax benefits as a result of settled income tax audits in combination with the lapsing of statute of limitations, offset by foreign income inclusions in the U.S., and a tax expense related to the recapture of certain Israel corporate income taxes. The income tax expense for fiscal 2023 is also impacted by a substantial portion of the Company’s earnings, or in some cases, losses being taxed or benefited at rates lower than the U.S. statutory rate, stock-based compensation tax benefits, and disallowed deductions related to non-deductible compensation.
Deferred tax assets and liabilities consist of the following (in millions):
| February 1, 2025 | February 3, 2024 | ||||||||||
| Deferred tax assets: | |||||||||||
| Net operating losses | $ | 112.0 | $ | 107.9 | |||||||
| Income tax credits | 1,133.0 | 1,056.6 | |||||||||
| Intangible assets | 536.7 | 580.0 | |||||||||
| Lease liabilities | 44.2 | 44.9 | |||||||||
| Other | 96.3 | 86.4 | |||||||||
| Gross deferred tax assets | 1,922.2 | 1,875.8 | |||||||||
| Valuation allowance | (1,176.2) | (1,099.0) | |||||||||
| Total deferred tax assets | 746.0 | 776.8 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Intangible assets | (274.3) | (421.4) | |||||||||
| Fixed assets | (41.5) | (39.0) | |||||||||
| Unremitted earnings of non-U.S. subsidiaries | (25.6) | (26.7) | |||||||||
| Right of use assets | (37.2) | (36.5) | |||||||||
| Total deferred tax liabilities | (378.6) | (523.6) | |||||||||
| Net deferred tax assets | $ | 367.4 | $ | 253.2 |
The deferred taxes reflected above for fiscal 2025 include the impact of the Fiscal 2025 Plan, which resulted in a reversal of deferred tax liabilities associated with acquired intangible assets.
The deferred tax assets and liabilities based on tax jurisdictions are presented on the Company’s consolidated balance sheets as follows (in millions):
| February 1, 2025 | February 3, 2024 | ||||||||||
| Non-current deferred tax assets | $ | 401.2 | $ | 311.9 | |||||||
| Non-current deferred tax liabilities | (33.8) | (58.7) | |||||||||
| Net deferred tax assets | $ | 367.4 | $ | 253.2 |
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The ultimate realization of deferred tax assets depends upon the generation of future taxable income during the periods in which those assets become deductible or creditable. The Company evaluates the recoverability of its deferred tax assets, weighing all positive and negative evidence, and provides or maintains a valuation allowance for these assets if it is more likely than not that some, or all, of the deferred tax assets will not be realized. If negative evidence exists, sufficient positive evidence is necessary to support a conclusion that a valuation allowance is not needed. The Company considers all available evidence such as its earnings history including the existence of cumulative income or losses, reversals of taxable temporary differences, projected future taxable income, and tax planning strategies. In the U.S., and in certain foreign jurisdictions, the Company has deferred tax assets for which partial valuation allowances have been established. After weighing all available evidence, particularly the earnings history and forecasts of future taxable income in each respective jurisdiction, as well as its history of tax credits expiring unused, the Company determined that negative evidence outweighed positive evidence with respect to the ability to realize federal, state, and foreign research and development and other tax credits, as well as certain other foreign deferred tax assets. The valuation allowance increased by $77.2 million from fiscal 2024, for certain federal, state, and foreign tax attributes. The Company maintains a valuation allowance on its U.S. R&D credits based on the factors listed above as well as forecasted R&D credit utilization and expected R&D credit generation in future years. In future periods, it is possible that significant positive or negative evidence could arise that results in a change in the Company’s judgment with respect to the need for a valuation allowance, which could result in a tax benefit, or adversely affect the Company’s income tax provision, in the period of such change in judgment.
As of February 1, 2025, the Company had net operating loss carryforwards available to offset future taxable income of approximately $476.1 million, $808.9 million, $262.9 million and $1.2 million for U.S. federal, state of California, other U.S. states, and foreign purposes, respectively. If not utilized, the federal loss carryforwards begin to expire in fiscal 2033, and the California carryforwards begin to expire in fiscal 2027. The majority of the Company’s foreign losses carry forward indefinitely. The Company also had federal research and other tax credit carryforwards of approximately $714.0 million, which begin to expire in fiscal 2027. As of February 1, 2025, the Company also had California research tax credit carryforwards of approximately $731.2 million, which can be carried forward indefinitely. In addition, the Company has research and other tax credit carryforwards of approximately $48.2 million in other U.S. states, which begin to expire in fiscal 2026. The Company also has research and other tax credit carryforwards of approximately $10.8 million in foreign jurisdictions, which begin to expire in fiscal 2027. The Company’s net operating loss and tax credit carryforwards may be subject to audit and adjusted for changes or modification in tax laws, other authoritative interpretations, or other facts and circumstances.
Utilization of the Company’s U.S. federal and state net operating loss and credit carryforwards may be subject to annual limitations due to ownership change provisions of the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. Future changes in the Company’s stock ownership, some of which are generally outside of the Company’s control, could result in an ownership change under Section 382 and Section 383 and result in a limitation on U.S. tax attributes. The Company has determined that no significant limitation would be placed on the utilization of its net operating loss and tax credit carry-forwards due to prior ownership changes.
The following table reflects changes in the unrecognized tax benefits (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Unrecognized tax benefits as of the beginning of the period | $ | 476.5 | $ | 317.5 | $ | 334.0 | |||||||||||
| Increases related to acquired tax positions | — | — | — | ||||||||||||||
| Increases related to prior year tax positions | — | — | 2.0 | ||||||||||||||
| Decreases related to prior year tax positions | (7.7) | (0.8) | (16.4) | ||||||||||||||
| Increases related to current year tax positions | 74.9 | 163.1 | 6.8 | ||||||||||||||
| Settlements | (0.2) | (1.0) | — | ||||||||||||||
| Lapse in the statute of limitations | (1.4) | (1.8) | (8.6) | ||||||||||||||
| Foreign exchange gain | (0.4) | (0.5) | (0.3) | ||||||||||||||
| Gross amounts of unrecognized tax benefits as of the end of the period | $ | 541.7 | $ | 476.5 | $ | 317.5 |
The Company has recorded $541.7 million of gross unrecognized tax benefits as of February 1, 2025, of which $207.0 million would affect the Company’s effective income tax rate if recognized. $489.6 million of the Company’s gross unrecognized tax benefits as of February 1, 2025 relate to income tax positions which, if recognized, would increase deferred tax assets that are subject to valuation allowances.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The total amount of interest and penalties accrued was approximately $5.8 million, $3.8 million, and $3.2 million as of February 1, 2025, February 3, 2024, and January 28, 2023, respectively. The consolidated statements of operations for fiscal 2025, 2024, and 2023 included accruals of $2.5 million, $1.3 million, and $1.6 million, respectively, of interest and penalties related to unrecognized tax benefits.
The Company’s major tax jurisdictions are the United States, the states of California and Massachusetts, Germany, India, Israel and Singapore. The Company is subject to income tax audits by the respective tax authorities in all of the jurisdictions in which it operates. The examination of tax liabilities in each of these jurisdictions requires the interpretation and application of complex and sometimes uncertain tax laws and regulations. As of February 1, 2025, the Company is subject to examination in significant jurisdictions including Germany, India, Israel, Singapore, and the United States for fiscal 2003 through 2025.
During the next 12 months, it is reasonably possible that the amount of unrecognized tax benefits could increase or decrease significantly due to changes in tax law in various jurisdictions, new tax audits and changes in the U.S. dollar as compared to foreign currencies within the next 12 months. Excluding these factors, the Company does not expect a significant decrease to its uncertain tax positions as a result of the lapse of the statutes of limitations in various jurisdictions during the next 12 months.
The Company maintains a Development and Expansion Incentive (“DEI”) in Singapore through June 30, 2029. To retain the current DEI tax benefits through June 2029 in Singapore, the Company must meet certain operating conditions, headcount and investment requirements, as well as maintain certain activities in Singapore. In fiscal 2025, 2024 and 2023, no Singapore tax incentive net tax benefits were recorded.
Marvell Israel (M.I.S.L) Ltd., is entitled to certain tax benefits through December 31, 2026 under the Israeli Encouragement of Investments Law (“Encouragement Law”) Special Technology Enterprise Regime, subject to various operating requirements and other conditions. In fiscal 2025, no Israel tax incentive net tax benefits were recorded. In fiscal 2024, tax savings associated with this program were approximately $8.7 million, which if paid, would impact the Company’s earnings per share by $0.01 per share. In fiscal 2023, tax savings associated with this program were approximately $11.2 million, which if paid, would impact the Company’s earnings per share by $0.01 per share.
The Company’s principal source of liquidity as of February 1, 2025 consisted of approximately $948.3 million of cash and cash equivalents, of which approximately $716.9 million was held by subsidiaries outside of the United States. In addition, the Company has an undrawn revolving credit facility of $1.0 billion. The Company has not recognized a deferred tax liability on $301.2 million of assets held by subsidiaries as such amounts are deemed to be indefinitely reinvested. The Company manages its worldwide cash requirements by, among other things, reviewing available funds held by its foreign subsidiaries and the cost effectiveness by which those funds can be accessed in the United States.
Note 13 — Net Loss Per Share
The Company reports both basic net loss per share, which is based on the weighted-average number of common stock outstanding during the period, and diluted net loss per share, which is based on the weighted-average number of common stock outstanding and potentially dilutive shares outstanding during the period.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The computations of basic and diluted net loss per share are presented in the following table (in millions, except per share amounts):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Numerator: | |||||||||||||||||
| Net loss | $ | (885.0) | $ | (933.4) | $ | (163.5) | |||||||||||
| Denominator: | |||||||||||||||||
| Weighted-average shares — basic | 865.5 | 861.3 | 851.4 | ||||||||||||||
| Effect of dilutive securities: | |||||||||||||||||
| Stock-based awards and warrant shares | — | — | — | ||||||||||||||
| Weighted-average shares — diluted | 865.5 | 861.3 | 851.4 | ||||||||||||||
| Net loss per share: | |||||||||||||||||
| Basic | $ | (1.02) | $ | (1.08) | $ | (0.19) | |||||||||||
| Diluted | $ | (1.02) | $ | (1.08) | $ | (0.19) |
Potential dilutive securities include dilutive common stock from stock-based awards attributable to the assumed exercise of stock options, restricted stock units, employee stock purchase plan shares and warrant shares using the treasury stock method. Under the treasury stock method, potential common stock outstanding are not included in the computation of diluted net income per share, if their effect is anti-dilutive.
Anti-dilutive potential shares are presented in the following table (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Weighted-average shares outstanding: | |||||||||||||||||
| Stock-based awards and warrant shares | 13.0 | 10.9 | 21.0 |
Anti-dilutive potential shares from stock-based awards are excluded from the calculation of diluted earnings per share for all periods reported above because either their exercise price exceeded the average market price during the period or the stock-based awards were determined to be anti-dilutive based on applying the treasury stock method. Anti-dilutive potential shares from stock-based awards and warrant shares are excluded from the calculation of diluted earnings per share for the years ended February 1, 2025, February 3, 2024, and January 28, 2023 due to the net losses reported in those periods.
Note 14 — Segment and Geographic Information
The Company operates in one reportable segment — the design, development and sale of integrated circuits. The chief executive officer was identified as the chief operating decision maker (“CODM”). Based on his direct involvement with the Company’s operations and product development, the CODM is ultimately responsible for and actively involved in the allocation of resources and the assessment of the Company’s performance using consolidated net income (loss) reported on the consolidated statements of operations. The Company’s organizational structure is based along functional lines, with each of the functional department heads, as well as shared resources, reporting directly to the CODM or to a direct report of the CODM. The Company uses a highly-integrated approach in developing its products in that discrete technologies developed by the Company are frequently integrated across many of its products, and substantially all of the Company’s integrated circuits are manufactured under similar manufacturing processes. Accordingly, the Company operates under a single operating segment.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents a summary of consolidated net loss inclusive of significant segment expenses and other expense information provided to the CODM (in millions):
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Net revenue | $ | 5,767.3 | $ | 5,507.7 | $ | 5,919.6 | |||||||||||
| Less: | |||||||||||||||||
| Product costs (a) | 2,246.7 | 2,136.8 | 2,102.2 | ||||||||||||||
| Employee compensation and related in operating expenses | 1,319.9 | 1,276.1 | 1,274.2 | ||||||||||||||
| Amortization of acquired intangible assets | 1,052.6 | 1,097.9 | 1,087.4 | ||||||||||||||
| Restructuring related charges (b) | 711.8 | 131.1 | 21.6 | ||||||||||||||
| Stock-based compensation | 597.4 | 609.8 | 552.4 | ||||||||||||||
| Engineering design related costs | 219.1 | 180.4 | 138.2 | ||||||||||||||
| Interest expense | 189.4 | 211.7 | 170.6 | ||||||||||||||
| Provision (benefit) for income taxes | (9.7) | 174.7 | 248.6 | ||||||||||||||
| Other segment expenses (c) | 325.1 | 622.6 | 487.9 | ||||||||||||||
| Net loss | $ | (885.0) | $ | (933.4) | $ | (163.5) |
(a)Includes material, labor and other product related costs, excluding the other categories above.
(b)Restructuring related charges of $357.9 million are included in cost of goods sold and $353.9 million are included in operating expenses for the year ended February 1, 2025 in the accompanying consolidated statements of operations.
(c)Includes depreciation and amortization expenses, facilities expenses, legal expenses, interest income and other income and expenses.
This expense information is based on management's internal view of expense classification when reviewing aspects of financial and operating performance of the business, and may not be representative of expense classification that is comparable to other peer companies' internal management views. As a result, this expense information should not be considered in isolation or as substitute for analysis of Marvell’s results in conjunction with the accompanying consolidated financial statements and notes thereto.
The following table presents long-lived asset information by geographic region (in millions):
| February 1, 2025 | February 3, 2024 | ||||||||||
| Property and equipment, net: | |||||||||||
| United States | $ | 398.6 | $ | 518.6 | |||||||
| Singapore | 321.0 | 159.7 | |||||||||
| Other | 70.9 | 77.7 | |||||||||
| $ | 790.5 | $ | 756.0 |
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 15 — Supplemental Financial Information (in millions)
Consolidated Balance Sheets
| February 1, 2025 | February 3, 2024 | ||||||||||
| Cash and cash equivalents: | |||||||||||
| Cash | $ | 891.1 | $ | 948.2 | |||||||
| Cash equivalents: | |||||||||||
| Time deposits | 57.2 | 2.6 | |||||||||
| Cash and cash equivalents | $ | 948.3 | $ | 950.8 |
Short-term, highly liquid investments of $57.2 million and $2.6 million as of February 1, 2025 and February 3, 2024, respectively, included in cash and cash equivalents on the accompanying consolidated balance sheets are not considered as investments because of the short-term maturity of such investments.
| February 1, 2025 | February 3, 2024 | ||||||||||
| Accounts receivable, net: | |||||||||||
| Accounts receivable | $ | 1,031.0 | $ | 1,123.6 | |||||||
| Less: Allowance for credit losses | (2.6) | (2.0) | |||||||||
| Accounts receivable, net | $ | 1,028.4 | $ | 1,121.6 |
The Company sells certain of its trade accounts receivable on a non-recourse basis to a third-party financial institution pursuant to a factoring arrangement. The Company accounts for these transactions as sales of receivables and presents cash proceeds as cash provided by operating activities in the consolidated statements of cash flows. After the sale of its trade accounts receivable, the Company will collect payment from the customer and remit it to the third-party financial institution. Total trade accounts receivable sold under the factoring arrangement were $868.8 million for the year ended February 1, 2025, of which $101.8 million remained subject to servicing by the Company as of February 1, 2025. Total trade accounts receivable sold under the factoring arrangement were $335.7 million for the year ended February 3, 2024, of which $155.9 million remained subject to servicing by the Company as of February 3, 2024. Factoring fees for the sales of receivables were recorded in interest income and other, net and were not material for fiscal 2025 and 2024.
| February 1, 2025 | February 3, 2024 | ||||||||||
| Inventories: | |||||||||||
| Work-in-process | $ | 709.0 | $ | 523.8 | |||||||
| Finished goods | 320.7 | 340.6 | |||||||||
| Inventories | $ | 1,029.7 | $ | 864.4 |
| February 1, 2025 | February 3, 2024 | ||||||||||
| Property and equipment, net: | |||||||||||
| Machinery and equipment | $ | 1,570.2 | $ | 1,376.2 | |||||||
| Land, buildings, and leasehold improvements | 306.6 | 312.4 | |||||||||
| Computer software | 126.4 | 116.5 | |||||||||
| Furniture and fixtures | 34.3 | 31.7 | |||||||||
| 2,037.5 | 1,836.8 | ||||||||||
| Less: Accumulated depreciation | (1,247.0) | (1,080.8) | |||||||||
| Property and equipment, net | $ | 790.5 | $ | 756.0 |
The Company recorded depreciation expense for property and equipment of $177.0 million, $148.2 million and $126.8 million for fiscal 2025, 2024 and 2023, respectively.
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
| February 1, 2025 | February 3, 2024 | ||||||||||
| Other non-current assets: | |||||||||||
| Prepaid ship and debits | $ | 516.9 | $ | 547.6 | |||||||
| Technology licenses (1) | 401.3 | 350.6 | |||||||||
| Prepayments on supply capacity reservation agreements | 307.8 | 302.5 | |||||||||
| Operating right-of-use assets | 246.0 | 203.6 | |||||||||
| Non-marketable equity investments | 48.2 | 45.8 | |||||||||
| Other | 74.8 | 56.8 | |||||||||
| Other non-current assets | $ | 1,595.0 | $ | 1,506.9 |
(1)Amortization of technology licenses was $125.5 million, $177.1 million and $189.5 million in fiscal 2025, 2024 and 2023, respectively.
| February 1, 2025 | February 3, 2024 | ||||||||||
| Accrued liabilities: | |||||||||||
| Variable consideration estimates (1) | $ | 517.9 | $ | 610.7 | |||||||
| Technology license obligations | 101.8 | 105.7 | |||||||||
| Accrued restructuring | 91.5 | 16.1 | |||||||||
| Accrued income tax payable | 55.6 | 17.8 | |||||||||
| Lease liabilities - current portion | 48.3 | 39.4 | |||||||||
| Accrued interest | 43.5 | 41.3 | |||||||||
| Deferred revenue | 22.1 | 43.2 | |||||||||
| Deferred non-recurring engineering credits | 17.7 | 21.7 | |||||||||
| Accrued legal reserve | 11.7 | 76.5 | |||||||||
| Other | 62.5 | 60.5 | |||||||||
| Accrued liabilities | $ | 972.6 | $ | 1,032.9 |
(1)Substantially all of the variable consideration estimate is comprised of the ship and debit claims accrual, but also includes estimated customer returns, price discounts, price protection, rebates, and stock rotation programs.
| February 1, 2025 | February 3, 2024 | ||||||||||
| Other non-current liabilities: | |||||||||||
| Technology license obligations | $ | 233.8 | $ | 196.5 | |||||||
| Lease liabilities - non-current | 231.0 | 196.0 | |||||||||
| Non-current restructuring liabilities | 228.4 | 0.9 | |||||||||
| Non-current income taxes payable | 73.4 | 56.6 | |||||||||
| Deferred tax liabilities | 33.8 | 58.7 | |||||||||
| Other | 16.0 | 15.6 | |||||||||
| Other non-current liabilities | $ | 816.4 | $ | 524.3 |
MARVELL TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Accumulated Other Comprehensive Income
The changes in accumulated other comprehensive income, net of tax, by components for the comparative period are presented in the following table (in millions):
| Unrealized Gain (Loss) on Cash Flow Hedges | ||||||||||||||||||||||||||
| Balance at January 28, 2023 | $ | — | ||||||||||||||||||||||||
| Other comprehensive income (loss) before reclassifications | (1.5) | |||||||||||||||||||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | 2.6 | |||||||||||||||||||||||||
| Net current-period other comprehensive income (loss), net of tax | 1.1 | |||||||||||||||||||||||||
| Balance at February 3, 2024 | 1.1 | |||||||||||||||||||||||||
| Other comprehensive income (loss) before reclassifications | 0.1 | |||||||||||||||||||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | (0.8) | |||||||||||||||||||||||||
| Net current-period other comprehensive income (loss), net of tax | (0.7) | |||||||||||||||||||||||||
| Balance at February 1, 2025 | $ | 0.4 |
Consolidated Statements of Cash Flows
| Year Ended | |||||||||||||||||
| February 1, 2025 | February 3, 2024 | January 28, 2023 | |||||||||||||||
| Supplemental Cash Flow Information: | |||||||||||||||||
| Cash paid for interest | $ | 173.4 | $ | 173.7 | $ | 147.9 | |||||||||||
| Cash paid for income taxes, net | $ | 40.1 | $ | 120.6 | $ | 95.9 | |||||||||||
| Non-Cash Investing and Financing Activities: | |||||||||||||||||
| Consideration unpaid for acquisitions | $ | — | $ | — | $ | 9.2 | |||||||||||
| Purchases under technology license obligations | $ | 307.5 | $ | 56.2 | $ | 108.9 | |||||||||||
| Unpaid purchases of property and equipment at end of year | $ | 69.3 | $ | 80.1 | $ | 63.2 | |||||||||||
Previous: Item 7A. Quantitative and Qualitative Disclosures About Market Risk · Next: Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure