UBS updated its outlook for two semiconductor companies on Monday, increasing near- and medium-term revenue and earnings estimates for Marvell Technology (NASDAQ:MRVL) and Astera Labs (NASDAQ:ALAB). The firm pointed to a widening opportunity in CXL technology as the primary driver for the revisions, and raised price targets for both names while maintaining its existing ratings.
The brokerage left Marvell at Buy and Astera at Neutral, but boosted price targets to $340 for Marvell and $400 for Astera from prior targets of $230 and $205, respectively. UBS emphasized that CXL - defined by the firm as a cache-coherent, low-latency, high-bandwidth interconnect built on PCIe - is evolving into a foundational enablement layer with a growing market footprint.
In its update, UBS said Marvell currently holds the leading share in CXL-related products. The bank nevertheless expects competitors such as Astera Labs and Broadcom (NASDAQ:AVGO) to capture larger positions as the overall market expands. UBS quantified the potential addressable ASIC attach market for CXL at $7 billion to $10 billion by 2030, driven by an evolution of use cases from single-CPU memory expansion toward rack-wide and multi-rack CXL fabrics that connect CPUs and XPUs.
UBS provided company-level detail for its forecasts. For Marvell, the firm now anticipates roughly $1 billion of CXL revenue in 2027, with that demand largely coming from XPU-attach within racks and supported by what UBS described as agentic CPU demand. The bank increased its 2028 CXL-related revenue estimate for Marvell to about $2 billion.
Corresponding to these CXL assumptions, UBS raised Marvell's overall revenue estimates for 2027 and 2028 to $16.8 billion and $23.9 billion, respectively, from earlier forecasts of $16.5 billion and $21.9 billion. Earnings per share estimates were also lifted to $6.23 for 2027 and $9.62 for 2028, up from prior EPS estimates of $6.09 and $8.60.
On Astera Labs, UBS increased revenue projections for 2027 and 2028 to $2.5 billion and $3.3 billion from prior estimates of $2.2 billion and $2.5 billion. The firm's EPS forecasts for Astera were raised to $5.34 and $7.04 for 2027 and 2028, up from $4.02 and $4.70. UBS said these upgrades reflect both incremental CXL demand and revised views on retimers tied to Trainium 3 shipments.
UBS also noted that Astera's Leo CXL extender has generated roughly $25 million of revenue annually, and that Microsoft (NASDAQ:MSFT) is a key customer. The bank expects Microsoft unit shipments to increase in the second half of 2026, and said that 2027 should receive additional support from a new U.S. hyperscaler design win for Astera.
The UBS notes highlight an analyst view that CXL will broaden from memory expansion in single-CPU deployments to larger fabrics linking multiple CPUs and XPUs, creating new attach opportunities for ASIC vendors. The revisions raise expectations for semiconductor revenue growth tied to data center interconnects and related hardware components.
What this means
- UBS raised price targets and multi-year revenue and EPS forecasts for Marvell and Astera based on accelerating CXL demand.
- Marvell is viewed as the current market share leader in CXL, though UBS expects competition from Astera and Broadcom as the market scales.
- UBS projects a $7 billion to $10 billion ASIC attach market for CXL by 2030 as applications move to rack- and multi-rack fabrics connecting CPUs and XPUs.
Analyst lens
The UBS update centers CXL as an architectural layer that could materially increase ASIC attach opportunities for vendors positioned in data center interconnects. The bank's company-level revisions reflect an assumption that design wins, hyperscaler demand, and evolving XPU attach models will drive revenue and earnings improvements for both Marvell and Astera.