Marvell jumps on S&P 500 inclusion after AI rally, strong outlook

Marvell Technology’s latest surge owes as much to index mechanics as to AI enthusiasm. Shares jumped more than 7% in premarket trading after S&P Dow Jones Indices said the chipmaker would join the S&P 500, a change that will force index funds and ETFs tracking the benchmark to buy the stock before the market opens on June 22.

The addition matters because it does not simply reward a company for size. It can also create a wave of automatic demand from passive investors who must mirror the benchmark. Marvell will replace Pool Corp., while Flex will take the place of Campbell’s Company, in a reshuffle that underscores how much the S&P 500 is being reshaped by the data-center and semiconductor buildout.

Marvell has already been riding that theme hard. The stock had gained about 59% since May 27, when the company said its custom-chip business would top $10 billion in revenue in fiscal 2029 and lifted its fiscal 2028 revenue outlook to about $16.5 billion, up from $15 billion. Jensen Huang, Nvidia’s chief executive, added to the optimism when he called Marvell the next “trillion-dollar company.”

That momentum arrived after a volatile week. Marvell fell 16.7% in Friday’s regular session as a broader chip selloff erased about $1.3 trillion in market value across the sector. Even after that drop, Marvell’s market capitalization stood at about $230 billion at the close, putting it firmly among the biggest names in U.S. semiconductors.

The company’s eligibility for the index was helped by a key profitability milestone. Marvell posted GAAP profit in the three months through December and across its most recent four quarters, a hurdle that had kept it out of the S&P 500 earlier. Its first-quarter fiscal 2026 results showed net revenue of $1.895 billion and GAAP net income of $177.9 million, or 20 cents a share, while non-GAAP net income was $540 million, or 62 cents a share. CNBC put first-quarter revenue at about $2.4 billion and pointed to stronger data-center growth expectations.

The broader signal is bigger than one stock. Chipmakers and data-center infrastructure companies are gaining more weight in major U.S. indexes as investors keep betting that AI spending will stay elevated. The Philadelphia Semiconductor Index is still up more than 72% this year despite Friday’s rout, showing how quickly benchmark membership can become both a reward for fundamentals and a fresh source of passive inflows. For Marvell, the S&P 500 addition is a milestone, but the long-term verdict will still rest on whether AI demand turns into durable revenue and profit growth.