Form: 8-K

Current report

May 22, 2003

Documents

EXHIBIT 99.1

Published on May 22, 2003


EXHIBIT 99.1


NEWS RELEASE

MARVELL(R) TECHNOLOGY GROUP LTD. REPORTS
RECORD FIRST QUARTER FISCAL 2004 RESULTS

Sunnyvale, CA. (May 22, 2003) - Marvell(R) Technology Group Ltd. (NASDAQ: MRVL),
the technology leader in the development of extreme broadband communications and
storage solutions, today reported financial results for its first fiscal quarter
ended May 3, 2003.

Net revenue for the first quarter of fiscal 2004 was a record $168.3 million, an
increase of 70% over net revenue of $98.8 million for the first quarter of
fiscal 2003 and a 12% sequential increase from net revenue of $150.8 million for
the fourth quarter of fiscal 2003. Net income under generally accepted
accounting principles (GAAP) was $4.4 million, or $0.03 per share (diluted), for
the first quarter of fiscal 2004, compared with net loss under GAAP of $30.9
million, or $0.26 per share (diluted), for the first quarter of fiscal 2003.

Marvell reports net income (loss) and basic and diluted net income (loss) per
share in accordance with GAAP and additionally on a non-GAAP basis, referred to
as pro forma. Pro forma net income, where applicable, excludes the effect of
acquisition-related expenses, amortization of stock-based compensation and
charges related to facilities consolidation. Pro forma net income was $24.5
million, or $0.19 per share (diluted), for the first quarter of fiscal 2004,
compared with pro forma net income of $10.5 million, or $0.08 per share
(diluted), for the first quarter of fiscal 2003. These non-GAAP measures should
be considered in addition to, and not as a substitute for, the results prepared
in accordance with GAAP. A reconciliation of GAAP net income (loss) to pro forma
net income is included in the financial statements portion of this release as
well as on our website in the Investors section at www.marvell.com.

Marvell's management believes the non-GAAP information is useful because it can
enhance the understanding of the Company's ongoing economic performance and
Marvell therefore uses pro forma reporting internally to evaluate and manage the
Company's operations. Marvell has chosen to provide this information to
investors to enable them to perform comparisons of operating results in a manner
similar to how the Company analyzes its operating results.

"Q1 was an outstanding quarter for Marvell," stated Dr. Sehat Sutardja,
Marvell's President and CEO. "Our 12% sequential growth in quarterly revenue was
our twenty-second consecutive quarter of revenue growth. Marvell's revenue
growth is being driven by the continued adoption of Gigabit Ethernet and our
integrated system-on-chip storage solutions. Bookings were very strong during
the quarter and we enter Q2 with strong momentum."


Marvell will be conducting a conference call today at 1:45 p.m. PST to discuss
its first quarter fiscal 2004 financial results. To listen to the conference
call, investors can dial (706) 679-0800 approximately fifteen minutes prior to
the initiation of the teleconference and refer to conference code 521891. Replay
of the conference call will be available until May 29, 2003 at midnight by
calling (706) 645-9291. The conference call will also be available via the web
at www.marvell.com until May 22, 2004.

ABOUT MARVELL

Marvell (NASDAQ: MRVL) is the leading global semiconductor provider of complete
broadband communications and storage solutions. The Company's diverse product
portfolio includes switching, transceiver, communications controller, wireless,
and storage solutions that power the entire communications infrastructure,
including enterprise, metro, home, and storage networking. As used in this
release, the terms "Company" and "Marvell" refer to Marvell Technology Group
Ltd. and its subsidiaries, including Marvell Semiconductor, Inc. (MSI), Marvell
Asia Pte Ltd (MAPL), Marvell Japan K.K., Marvell Taiwan Ltd., Marvell
International Ltd. (MIL), Marvell U.K. Limited, Marvell Semiconductor Israel
Ltd. (MSIL), and SysKonnect GmbH. MSI is headquartered in Sunnyvale, Calif., and
designs, develops and markets products on behalf of MIL and MAPL. MSI may be
contacted at (408) 222-2500 or at www.marvell.com.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: This release contains forward-looking statements based on projections and
assumptions about our products and our markets. Words such as "anticipates,"
"expects," "intends," "plans," "believes," "seeks," "estimates," "may," "will,"
"should," and their variations identify forward-looking statements. These
statements include those relating to momentum with respect to fiscal Q2 and the
impact of the continued adoption of our solutions on our revenue growth.
Statements that refer to, or are based on projections, uncertain events or
assumptions also identify forward-looking statements. These statements are not
guarantees of results and are subject to risks and uncertainties. Some risks and
uncertainties that may adversely impact the statements in this release include,
but are not limited to, the timing, cost and successful completion of
development and volume production, end-customer qualification and adoption, and
the timing, pricing, rescheduling, or cancellation of orders. For other factors
that could cause Marvell's results to vary from expectations, please see the
sections titled "Additional Factors That May Affect Future Results" in Marvell's
annual report on Form 10-K for the fiscal year ended February 1, 2003. We
undertake no obligation to revise or update publicly any forward-looking
statements.

Marvell(R) and the Marvell logo are trademarks of Marvell. All other trademarks
are the property of their respective owners.

Marvell Technology Group Ltd.
Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)



THREE MONTHS ENDED
----------------------
MAY 3, MAY 4,
2003 2002
-------- ---------

Net revenue $168,283 $ 98,800
Cost of goods sold 76,113 43,780
-------- ---------
Gross profit 92,170 55,020
Operating expenses:
Research and development 46,639 30,609
Selling and marketing 15,463 11,012
General and administrative 3,580 3,642
Amortization of stock-based compensation 658 2,282
Amortization of acquired intangible assets 19,448 21,323
Facilities consolidation charge -- 17,799
-------- ---------
Total operating expenses 85,788 86,667
-------- ---------
Operating income (loss) 6,382 (31,647)
Interest and other income, net 1,311 2,139
-------- ---------
Income (loss) before income taxes 7,693 (29,508)
Provision for income taxes 3,336 1,426
-------- ---------
Net income (loss) $ 4,357 $ (30,934)
======== =========
Basic net income (loss) per share $ 0.04 $ (0.26)
======== =========
Diluted net income (loss) per share $ 0.03 $ (0.26)
======== =========
Weighted average shares - basic 121,336 118,089
-------- ---------
Weighted average shares - diluted 129,573 118,089
-------- ---------






Marvell Technology Group Ltd.
Pro Forma Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)



Three Months Ended
----------------------
May 3, May 4,
2003 2002
-------- ---------

Net revenue $168,283 $ 98,800
Cost of goods sold 76,113 43,780
-------- ---------
Gross profit 92,170 55,020
Operating expenses:
Research and development 46,639 30,609
Selling and marketing 15,463 11,012
General and administrative 3,580 3,642
-------- ---------
Total operating expenses 65,682 45,263
-------- ---------
Operating income 26,488 9,757
Interest and other income, net 1,311 2,139
-------- ---------
Income before income taxes 27,799 11,896
Provision for income taxes 3,336 1,426
-------- ---------
Pro forma net income $ 24,463 $ 10,470
======== =========
Basic pro forma net income per share $ 0.20 $ 0.09
======== =========
Diluted pro forma net income per share $ 0.19 $ 0.08
======== =========
Weighted average shares - basic 121,336 118,089
-------- ---------
Weighted average shares - diluted 129,573 132,450
-------- ---------

RECONCILIATION OF GAAP NET INCOME (LOSS)
TO PRO FORMA NET INCOME:
GAAP net income (loss) $ 4,357 $ (30,934)
Amortization of stock-based compensation 658 2,282
Amortization and write-off of goodwill and
acquired intangible assets 19,448 21,323
Facilities consolidation charge -- 17,799
-------- ---------
Pro forma net income $ 24,463 $ 10,470
======== =========



The above pro forma statements of operations are for informational purposes only
and are provided for understanding our operating results. The pro forma
statements of operations have not been prepared in accordance with GAAP, should
not be considered a substitute for our historical financial information prepared
in accordance with GAAP and may be different from pro forma measures used by
other companies. The pro forma income has been derived by adjusting the net loss
under generally accepted accounting principles for the impact of non cash
stock-based compensation charges, charges associated with purchase accounting
and charges for facilities consolidation.



Marvell Technology Group Ltd.
Consolidated Balance Sheets
(Unaudited)
(In thousands)



MAY 3, FEBRUARY 1,
ASSETS 2003 2003
----------- -----------

Current assets:
Cash and cash equivalents $ 159,287 $ 125,316
Short-term investments 139,638 139,912
Accounts receivable, net 90,068 86,175
Inventory, net 46,771 39,712
Prepaid expenses and other current assets 21,105 19,979
----------- -----------
Total current assets 456,869 411,094
Property and equipment, net 72,128 69,246
Goodwill and acquired intangible assets 1,551,195 1,570,643
Other noncurrent assets 49,204 49,313
----------- -----------
Total assets $ 2,129,396 $ 2,100,296
=========== ===========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 62,276 $ 47,672
Accrued liabilities 30,029 26,955
Income taxes payable 5,100 2,247
Deferred revenue 11,265 12,481
Current portion of capital lease obligations 6,346 5,019
----------- -----------
Total current liabilities 115,016 94,374
Capital lease obligations 14,356 13,755
Other long-term liabilities 41,926 42,029
----------- -----------
Total liabilities 171,298 150,158
----------- -----------

Shareholders' equity:
Common stock 244 243
Additional paid-in capital 2,676,795 2,674,095
Deferred stock-based compensation (4,920) (5,899)
Accumulated other comprehensive income 1,911 1,988
Accumulated deficit (715,932) (720,289)
----------- -----------
Total shareholders' equity 1,958,098 1,950,138
----------- -----------
Total liabilities and shareholders' equity $ 2,129,396 $ 2,100,296
=========== ===========