What changed in this filing

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Item 1. Financial Statements

2022-05-27 compared with 2021-12-03 · 408 added, 616 removed, 329 unchanged (76% of the section changed)

2 unchanged sentences

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value per share)

(In millions, except par value per share)

2022 January 29,

30 unchanged sentences

MARVELL TECHNOLOGY, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

Three Months Ended Nine Months Ended

2021 October 31,

2020 October 30,

2021 October 31,

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In millions, except per share amounts)

Three Months Ended

Net revenue $ 1,446.9 $ 832.3

6 unchanged sentences

Total operating expenses 681.1 500.5

Operating loss ( 33,341 ) ( 9,390 ) ( 382,320 ) ( 256,653 )

Operating income (loss) 69.8 ( 82.3 )

Interest income 0.5 0.2

Interest expense ( 36.3 ) ( 35.1 )

Other income (loss), net 999 299 568 3,613

Other income, net 5.2 1.2

Interest and other income (loss), net ( 30.6 ) ( 33.7 )

Loss before income taxes ( 67,576 ) ( 24,549 ) ( 485,569 ) ( 299,328 )

Benefit for income taxes ( 5,044 ) ( 1,641 ) ( 58,367 ) ( 5,494 )

Income (loss) before income taxes 39.2 ( 116.0 )

Provision (benefit) for income taxes 204.9 ( 27.8 )

Net loss $ ( 165.7 ) $ ( 88.2 )

Comprehensive loss, net of tax $ ( 165.7 ) $ ( 88.2 )

Net loss per share - basic $ ( 0.20 ) $ ( 0.13 )

5 unchanged sentences

MARVELL TECHNOLOGY, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

Three Months Ended Nine Months Ended

2021 October 31,

2020 October 30,

2021 October 31,

Net loss $ ( 62,532 ) $ ( 22,908 ) $ ( 427,202 ) $ ( 293,834 )

Other comprehensive income (loss), net of tax:

Net change in unrealized gain (loss) on cash flow hedges — ( 450 ) — —

Other comprehensive income (loss), net of tax — ( 450 ) — —

Comprehensive loss, net of tax $ ( 62,532 ) $ ( 23,358 ) $ ( 427,202 ) $ ( 293,834 )

See accompanying notes to unaudited condensed consolidated financial statements

MARVELL TECHNOLOGY, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except per share amounts)

(In millions, except per share amounts)

Common Stock Additional Paid-in Capital

3 unchanged sentences

Tax withholdings related to net share settlement of restricted stock units — — ( 137.6 ) — ( 137.6 )

Share-based compensation — — 92,705 — 92,705

Issuance of common stock in connection with acquisitions 129,222 259 5,910,927 — 5,911,186

Equity related issuance cost — — ( 8,177 ) — ( 8,177 )

Replacement equity awards attributable to pre-acquisition service — — 82,346 — 82,346

Conversion feature of convertible notes — — 244,155 — 244,155

Impact of repurchases of convertible notes 7,115 14 234,333 — 234,347

Conversion of convertible notes to common stock 2,502 5 59,704 — 59,709

Stock-based compensation — — 129.7 — 129.7

Repurchase of common stock ( 0.3 ) — ( 15.0 ) — ( 15.0 )

Cash dividends declared and paid ($ 0.06 per share)

1 unchanged sentence

Net loss — — — ( 165.7 ) ( 165.7 )

Balance at May 1, 2021 816,420 $ 1,633 $ 12,879,095 $ 1,974,642 $ 14,855,370

Balance at April 30, 2022 850.5 $ 1.7 $ 14,188.5 $ 1,274.8 $ 15,465.0

Common Stock Additional Paid-in Capital

Shares Amount Retained Earnings Total

Balance at January 30, 2021 675.4 $ 1.4 $ 6,331.0 $ 2,103.4 $ 8,435.8

Issuance of common stock in connection with equity incentive plans 2.2 — 0.5 — 0.5

Tax withholdings related to net share settlement of restricted stock units — — ( 68.3 ) — ( 68.3 )

Share-based compensation — — 122,322 — 122,322

Issuance of common stock in connection with acquisitions 145 — 6,625 — 6,625

Conversion of convertible notes to common stock 3,865 8 84,387 — 84,395

Cash dividends declared and paid ($ 0.06 per share)

— — — ( 49,332 ) ( 49,332 )

Net loss — — — ( 276,428 ) ( 276,428 )

Balance at July 31, 2021 823,377 $ 1,646 $ 13,090,669 $ 1,648,882 $ 14,741,197

Issuance of common shares in connection with equity incentive plans 1,677 3 2,087 — 2,090

Tax withholdings related to net share settlement of restricted stock units — — ( 52,851 ) — ( 52,851 )

Share-based compensation — — 121,249 — 121,249

Stock-based compensation — — 92.7 — 92.7

Issuance of common stock in connection with acquisitions 129.2 0.3 5,910.9 — 5,911.2

Equity related issuance cost — — ( 8.2 ) — ( 8.2 )

Replacement equity awards attributable to pre-acquisition service — — 82.3 — 82.3

— — 33,224 — 33,224

Conversion feature of convertible notes — — 244.2 — 244.2

Impact of repurchases of convertible notes 7.1 — 234.3 234.3

Conversion of convertible notes to common stock 2.5 — 59.7 59.7

2 unchanged sentences

Net loss — — — ( 88.2 ) ( 88.2 )

Balance at October 30, 2021 841,540 $ 1,682 $ 14,148,741 $ 1,535,921 $ 15,686,344

MARVELL TECHNOLOGY, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except per share amounts)

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss)

Shares Amount Retained Earnings Total

Balance at February 1, 2020 663,481 $ 1,328 $ 6,135,939 $ — $ 2,541,313 $ 8,678,580

Issuance of common stock in connection with equity incentive plans 2,993 5 5,466 — — 5,471

Tax withholdings related to net share settlement of restricted stock units — — ( 31,498 ) — — ( 31,498 )

Share-based compensation — — 60,199 — — 60,199

Repurchase of common stock ( 1,251 ) ( 3 ) ( 25,199 ) — — ( 25,202 )

Cash dividends declared and paid ($ 0.06 per share)

— — — — ( 39,763 ) ( 39,763 )

Net loss — — — — ( 113,033 ) ( 113,033 )

Other comprehensive income — — — 868 — 868

Balance at May 1, 2021 816.4 $ 1.7 $ 12,879.1 $ 1,974.6 $ 14,855.4

Issuance of common stock in connection with equity incentive plans 4,794 10 42,763 — — 42,773

Tax withholdings related to net share settlement of restricted stock units — — ( 25,212 ) — — ( 25,212 )

Share-based compensation — — 62,784 — — 62,784

Cash dividends declared and paid ($ 0.06 per share)

— — — — ( 40,119 ) ( 40,119 )

Net loss — — — — ( 157,893 ) ( 157,893 )

Other comprehensive loss — — — ( 418 ) — ( 418 )

Balance at August 1, 2020 670,017 $ 1,340 $ 6,225,242 $ 450 $ 2,190,505 $ 8,417,537

Issuance of common shares in connection with equity incentive plans 1,720 3 2,251 — — 2,254

Tax withholdings related to net share settlement of restricted stock units — — ( 25,911 ) — — ( 25,911 )

Share-based compensation — — 59,324 — — 59,324

Cash dividends declared and paid ($ 0.06 per share)

— — — ( 40,229 ) ( 40,229 )

Net loss — — — — ( 22,908 ) ( 22,908 )

Other comprehensive loss — — — ( 450 ) — ( 450 )

Balance at October 31, 2020 671,737 $ 1,343 $ 6,260,906 $ — $ 2,127,368 $ 8,389,617

See accompanying notes to unaudited condensed consolidated financial statements

1 unchanged sentence

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Nine Months Ended

2021 October 31,

(In millions)

Three Months Ended

Cash flows from operating activities:

Net loss $ ( 165.7 ) $ ( 88.2 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization 75.7 51.8

Share-based compensation 325,922 182,060

Stock-based compensation 131.1 92.7

Amortization of acquired intangible assets 272.5 128.6

Amortization of inventory fair value adjustment associated with acquisitions 9.3 13.7

Amortization of deferred debt issuance costs and debt discounts 19,031 3,217

Restructuring related impairment charges 5,205 123,559

Other expense, net 6.7 31.4

Deferred income taxes 165.0 ( 22.6 )

Changes in assets and liabilities, net of acquisition:

Changes in assets and liabilities, net of acquisitions:

Accounts receivable ( 139.5 ) ( 58.0 )

4 unchanged sentences

Accrued liabilities and other non-current liabilities 97.0 ( 47.0 )

Net cash provided by operating activities 473,045 658,992

Net cash provided by (used in) operating activities 194.8 ( 13.7 )

Cash flows from investing activities:

15 unchanged sentences

Payment of equity and debt financing costs — ( 1.5 )

Other, net 1,003 ( 1,504 )

Net cash provided by (used in) financing activities ( 260.9 ) 3,412.3

Net increase (decrease) in cash and cash equivalents ( 224,965 ) 184,437

Net decrease in cash and cash equivalents ( 148.5 ) ( 226.0 )

Cash and cash equivalents at beginning of period 613.5 748.5

5 unchanged sentences

The unaudited condensed consolidated financial statements of Marvell Technology, Inc.

(“MTI”), a Delaware corporation, and its wholly owned subsidiaries (the “Company”), as of and for the three and nine months ended October 30, 2021, have been prepared as required by the U.S.

(“MTI”), a Delaware corporation, and its wholly owned subsidiaries (the “Company”), as of and for the three months ended April 30, 2022, have been prepared as required by the U.S.

Securities and Exchange Commission (the “SEC”).

8 unchanged sentences

These financial statements should also be read in conjunction with the Company’s critical accounting policies included in the Company’s Annual Report on Form 10-K for the year ended January 29, 2022 and those included in this Form 10-Q below.

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.

The Company’s fiscal year is the 52- or 53-week period ending on the Saturday closest to January 31.

3 unchanged sentences

Fiscal 2023 is a 52-week year.

On April 20, 2021, the Company completed its acquisition of Inphi Corporation (“Inphi”).

Inphi is a global leader in high-speed data movement enabled by optical interconnects.

The unaudited condensed consolidated financial statements include the operating results of Inphi for the period from the date of acquisition through the Company’s third quarter ended October 30, 2021.

See “Note 3 - Business Combinations”, “Note 4 - Goodwill and Acquired Intangible Assets, Net” for more information.

In conjunction with the acquisition transaction, Marvell Technology Group Ltd.

and Inphi became wholly owned subsidiaries of the new parent company, MTI, on April 20, 2021.

The parent company is domiciled in and subject to taxation in the United States.

See “Note 12 - Income Taxes” for more information.

On October 5, 2021, the Company completed its acquisition of Innovium, Inc.

(“Innovium”), a leading provider of networking solutions for cloud and edge data centers, in an all-stock transaction.

The unaudited condensed consolidated financial statements include the operating results of Innovium for the period from the date of acquisition through the Company’s third quarter ended October 30, 2021.

See “Note 3 - Business Combinations”, “Note 4 - Goodwill and Acquired Intangible Assets, Net” for more information.

Use of Estimates

7 unchanged sentences

Accounting Pronouncements Recently Adopted

In December 2019, the Financial Accounting Standards Board (the “FASB”) issued an accounting standards update that simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation and modified the methodology for calculating income taxes in an interim period.

It also clarifies and simplifies other aspects of the accounting for income taxes.

The guidance is effective for the Company beginning in the first quarter of fiscal year 2022, with early adoption permitted.

The new standard was adopted by the Company on January 31, 2021 on a prospective basis and did not have a material effect on the Company’s consolidated financial statements.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Accounting Pronouncements Not Yet Effective

In August 2020, the FASB issued an accounting standards update that simplifies the accounting for convertible debt instruments by reducing the number of accounting models and the number of embedded conversion features that could be recognized separately from the primary contract.

The standard requires a convertible debt instrument to be accounted for as a single liability measured at its amortized cost as long as no other features require bifurcation and recognition as derivatives.

It also made changes to the disclosures for convertible instruments and earnings-per-share guidance, among other updates.

The guidance is effective for the Company beginning in the first quarter of fiscal year 2023, with early adoption permitted and permits the use of either the modified retrospective or fully retrospective method of transition.

The Company does not expect the adoption of this guidance to have a material effect on its consolidated financial statements.

In October 2021, the FASB issued an accounting standards update that requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers.

The guidance is effective for the Company beginning in the first quarter of fiscal year 2024, with early adoption permitted.

The guidance should be applied prospectively to acquisitions occurring on or after the effective date.

The Company is evaluating the impact that this new standard will have on the Company’s consolidated financial statements.

Business Combinations

On October 5, 2021, the Company completed the acquisition of Innovium, Inc.

(“Innovium”), a leading provider of networking solutions for cloud and edge data centers, in an all-stock transaction for total purchase consideration of $ 1.0 billion attributable to stock consideration of $ 994.2 million and the fair value of a previously held equity interest of $ 10.0 million.

The Innovium acquisition was primarily intended to allow the Company to immediately participate in the fastest growing segment of the switch market with a cloud-optimized solution.

In accordance with the terms of the Agreement and Plan of Merger dated August 2, 2021 (the “Innovium merger agreement”), the Company’s common stock was issued in exchange for all outstanding equity of Innovium, including shares of Innovium’s preferred and common stock, employee equity awards and warrants.

The factors contributing to the recognition of goodwill were based upon the Company’s conclusion that there are strategic and synergistic benefits that are expected to be realized from the acquisition.

Goodwill recorded for the Innovium acquisition is not expected to be deductible for tax purposes.

The following table summarized the total merger consideration (in thousands):

Common stock issued or to be issued $ 971,022

Stock consideration for replacement equity awards attributable to pre-combination service 33,224

Total merger consideration $ 1,004,246

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The merger consideration allocation set forth herein is preliminary and may be revised with adjustment to goodwill as additional information becomes available during the measurement period from the closing date of the acquisition to finalize such preliminary estimates.

Any such revisions or changes may be material.

In accordance with U.S.

GAAP requirements for business combinations, the Company allocated the fair value of the purchase consideration to the tangible assets, liabilities and intangible assets acquired, including in-process research and development (“IPR&D”), generally based on their estimated fair values.

The excess purchase price over those fair values 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.

The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates, especially with respect to intangible assets.

Acquisition-related costs are expensed in the periods in which such costs are incurred.

See “Note 4 - Goodwill and Acquired Intangible Assets, Net” for additional information.

The purchase price allocation is as follows (in thousands):

Cash and cash equivalents $ 60,436

Inventories 69,991

Goodwill 470,000

Acquired intangible assets, net 433,000

Other, net ( 29,181 )

Total merger consideration $ 1,004,246

The Company incurred total acquisition related costs of $ 11.9 million during the three and nine months ended October 30, 2021, which were recorded in selling, general and administrative expense in the unaudited condensed consolidated statements of operations.

Post acquisition revenue and income (loss) on a standalone basis is impracticable to determine as the Company integrated Innovium into its existing financial systems and operations in the third quarter ended October 30, 2021.

On April 20, 2021, the Company completed the acquisition of Inphi (the “Inphi acquisition”).

Inphi is a global leader in high-speed data movement enabled by optical interconnects.

The Inphi acquisition was primarily intended to create an opportunity for the combined company to be uniquely positioned to serve the data-driven world, addressing high growth, attractive end markets such as cloud data center and 5G.

In accordance with the terms of the Agreement and Plan of Merger dated as of October 29, 2020, by and among the Company and Inphi (the “Inphi merger agreement”), the Company acquired all outstanding shares of common stock of Inphi for $ 66 per share in cash and 2.323 shares of the Company’s common stock exchanged for each share of Inphi common stock.

The merger consideration paid in cash was funded with a combination of cash on hand and funds from the Company’s debt financing.

See “Note 5 - Debt” for additional information.

Goodwill recorded for the Inphi acquisition is not expected to be deductible for tax purposes.

The following table summarized the total merger consideration (in thousands):

Cash consideration $ 3,673,217

Common stock issued

Stock consideration for replacement equity awards attributable to pre-combination service 82,346

Equity component of convertible debt 244,155

Total merger consideration $ 9,917,529

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Any such revisions or changes may be material.

In accordance with U.S.

GAAP requirements for business combinations, the Company allocated the fair value of the purchase consideration to the tangible assets, liabilities and intangible assets acquired, including IPR&D, generally based on their estimated fair values.

The excess purchase price over those fair values 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.

The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates, especially with respect to intangible assets.

Acquisition-related costs are expensed in the periods in which such costs are incurred.

See “Note 4 - Goodwill and Acquired Intangible Assets, Net” for additional information.

The purchase price allocation is as follows (in thousands):

Cash and cash equivalents $ 72,251

Accounts receivable, net 99,728

Inventories 270,382

Prepaid expenses and other current assets 213,292

Property and equipment, net 98,528

Acquired intangible assets, net 4,420,000

Other non-current assets 145,856

Goodwill 5,639,483

Accounts payable and accrued liabilities ( 189,807 )

Convertible debt - short-term ( 313,664 )

Convertible debt - long-term ( 240,317 )

Other non-current liabilities ( 298,203 )

Total merger consideration $ 9,917,529

The amounts presented in the table above is the purchase price allocation reported in the Company’s Form 10-Q for the second quarter ended July 31, 2021.

There were no measurement period adjustments during the third quarter ended October 30, 2021.

There were no acquisition costs incurred in the three months ended October 30, 2021.

The Company incurred $ 50.8 million in acquisition related costs which were recorded in selling, general and administrative expense in the unaudited condensed consolidated statements of operations for the nine months ended October 30, 2021.

The Company also incurred $ 39.8 million of aggregate debt financing costs.

As of October 30, 2021, $ 2.5 million is included in short-term debt, and $ 32.0 million is included in long-term debt on the accompanying unaudited condensed consolidated balance sheets.

See “Note 5 - Debt” for additional information.

Additionally, the Company incurred $ 8.2 million of equity issuance costs, which were recorded in additional paid-in capital in the unaudited condensed consolidated balance sheets.

Post acquisition revenue and income (loss) on a standalone basis is impracticable to determine as the Company integrated Inphi into its existing financial systems and operations in the second quarter ended July 31, 2021.

Unaudited Supplemental Pro Forma Information

The unaudited supplemental pro forma financial information presented below is for illustrative purposes only and is not necessarily indicative of the financial position or results of operations that would have been realized if the acquisitions had been completed on the date indicated, does not reflect synergies that might have been achieved, nor is it indicative of future operating results or financial position.

The pro forma adjustments are based upon currently available information and certain assumptions the Company believes are reasonable under the circumstances.

The new standard was early adopted by the Company on January 30, 2022 and did not have a material effect on the Company’s condensed consolidated financial statements.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The following unaudited supplemental pro forma information presents the combined results of operations for each of the periods presented, as if Innovium and Inphi had been acquired as of the beginning of fiscal year 2021.

The unaudited supplemental pro forma information includes adjustments to amortization and depreciation for acquired intangible assets and property and equipment, adjustments to share-based compensation expense, the purchase accounting effect on inventories acquired, interest expense, and transaction costs.

For fiscal year 2021, non-recurring pro forma adjustments directly attributable to the Innovium and Inphi acquisitions in the pro forma information presented below included (i) share-based compensation expense of $ 46.7 million, (ii) the purchase accounting effect of inventories acquired of $ 233.0 million, (iii) interest expense of $ 11.4 million, and (iv) transaction costs of $ 77.4 million.

The unaudited supplemental pro forma information presented below is for informational purposes only and is not necessarily indicative of our unaudited condensed consolidated results of operations of the combined business had the Inphi acquisition actually occurred at the beginning of fiscal year 2021 or of the results of our future operations of the combined business.

The unaudited supplemental pro forma financial information for the periods presented is as follows (in thousands):

Nine Months Ended

2021 October 31,

Pro forma net revenue $ 3,295,498 $ 2,693,723

Pro forma net loss $ ( 262,210 ) $ ( 1,213,149 )

Goodwill and Acquired Intangible Assets, Net

Goodwill represents the excess of the purchase price over the fair value of net tangible and identifiable intangible assets acquired in a business combination.

The carrying value of goodwill as of October 30, 2021 and January 30, 2021 is $ 11.4 billion and $ 5.3 billion respectively.

See “Note 3 - Business Combinations” for discussion of acquisitions and changes to the carrying value of goodwill.

Acquired Intangible Assets, Net

In connection with the Innovium acquisition on October 5, 2021, the Company acquired $ 433.0 million of intangible assets as follows (in thousands, except for weighted-average useful life as of acquisition date):

Preliminary Estimated Asset Fair Value Weighted-Average Useful Life (Years)

Developed technology $ 274,000 8.00

Customer contracts and related relationships 66,000 8.00

IPR&D 93,000 n/a

In connection with the Inphi acquisition on April 20, 2021, the Company acquired $ 4.4 billion of intangible assets as follows (in thousands, except for weighted-average useful life as of acquisition date):

Preliminary Estimated Asset Fair Value Weighted-Average Useful Life (Years)

Developed technology $ 2,010,000 6.00

Customer contracts and related relationships 1,470,000 6.00

Order backlog 70,000 0.80

Trade name 50,000 5.00

IPR&D 820,000 n/a

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):

Three Months Ended

2022 % of Total May 1,

2021 % of Total

Net revenue by end market:

Data center $ 640.5 44 % $ 277.1 33 %

Carrier infrastructure 252.0 18 % 167.6 20 %

Enterprise networking 286.6 20 % 174.8 21 %

Consumer 178.5 12 % 166.7 20 %

Automotive/industrial 89.3 6 % 46.1 6 %

$ 1,446.9 $ 832.3

The following table summarizes net revenue disaggregated by primary geographical market based on destination of shipment (in millions, except percentages):

Three Months Ended

2022 % of Total May 1,

2021 % of Total

Net revenue based on destination of shipment:

China $ 644.0 45 % $ 341.1 41 %

United States 149.5 10 % 87.4 11 %

Thailand 99.3 7 % 77.8 9 %

Malaysia 81.2 6 % 58.6 7 %

Japan 67.0 5 % 43.8 5 %

Taiwan 53.6 4 % 28.6 3 %

Philippines 51.9 4 % 47.6 6 %

Singapore 50.1 3 % 51.5 6 %

Other 250.3 16 % 95.9 12 %

$ 1,446.9 $ 832.3

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.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

As of October 30, 2021 and January 30, 2021, net carrying amounts are as follows (in thousands, except for weighted-average remaining amortization period):

October 30, 2021

Gross Carrying Amounts Accumulated Amortization Net Carrying Amounts Weighted-Average Remaining Amortization Period (Years)

Developed technologies $ 4,740,000 $ ( 1,154,971 ) $ 3,585,029 5.41

Customer contracts and related relationships 2,179,000 ( 428,370 ) 1,750,630 5.45

Order backlog 70,000 ( 45,642 ) 24,358 0.28

Trade names 73,000 ( 22,911 ) 50,089 4.17

Total acquired amortizable intangible assets $ 7,062,000 $ ( 1,651,894 ) $ 5,410,106 5.39

IPR&D 1,029,000 — 1,029,000 n/a

Total acquired intangible assets $ 8,091,000 $ ( 1,651,894 ) $ 6,439,106

January 30, 2021

Gross Carrying Amounts Accumulated Amortization Net Carrying Amounts Weighted-Average Remaining Amortization Period (Years)

Developed technologies $ 2,454,000 $ ( 724,215 ) $ 1,729,785 5.54

Customer contracts and related relationships 643,000 ( 228,845 ) 414,155 5.62

Trade names 23,000 ( 14,240 ) 8,760 2.20

Total acquired amortizable intangible assets $ 3,120,000 $ ( 967,300 ) $ 2,152,700 5.54

IPR&D 118,000 — 118,000 n/a

Total acquired intangible assets $ 3,238,000 $ ( 967,300 ) $ 2,270,700

The intangible assets are amortized on a straight-line basis over the estimated useful lives, except for certain Cavium 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 IPR&D will be accounted for as an indefinite-lived intangible asset and will not be amortized until the underlying projects reach technological feasibility and commercial production at which point the IPR&D will be amortized over the estimated useful life.

Useful lives for these IPR&D projects are expected to range between 3 to 10 years.

In the event the IPR&D is abandoned, the related assets will be written off.

Amortization expense for acquired intangible assets for the three and nine months ended October 30, 2021 was $ 279.3 million and $ 684.6 million, respectively.

Amortization expense for acquired intangible assets for the three and nine months ended October 31, 2020 was $ 109.4 million and $ 333.9 million, respectively.

The following table presents the estimated future amortization expense of acquired amortizable intangible assets as of October 30, 2021 (in thousands):

Fiscal Year Amount

Remainder of 2022 $ 285,684

2023 1,050,897

The following table summarizes net revenue disaggregated by customer type (in millions, except percentages):

Three Months Ended

2022 % of Total May 1,

2021 % of Total

Net revenue by customer type:

Direct customers $ 993.9 69 % $ 570.3 69 %

Distributors 453.0 31 % 262.0 31 %

$ 1,446.9 $ 832.3

Thereafter 1,144,954

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 three months ended April 30, 2022 that was included in deferred revenue balance at January 29, 2022 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.

In accordance with the practical expedients available in the guidance, the Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected duration of one year or less.

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 unaudited condensed consolidated statements of operations.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The following table summarizes the Company’s outstanding debt at October 30, 2021 and January 30, 2021 (in thousands):

Summary of Borrowings and Outstanding Debt

The following table summarizes the Company’s outstanding debt at April 30, 2022 and January 29, 2022 (in millions):

2022 January 29,

Face Value Outstanding:

2018 Term Loan $ — $ 200,000

2020 Term Loan - 3 Year Tranche $ 735.0 $ 735.0

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4.200 % MTG/MTI 2023 Senior Notes

499,952 500,000

4.875 % MTG/MTI 2028 Senior Notes

499,915 500,000

1.650 % 2026 Senior Notes

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Net carrying amount of debt $ 4,539.4 $ 4,548.0

Current portion - Term Loan (1) 52,205 199,641

Current portion (1) 74.1 63.2

Non-current portion $ 4,465.3 $ 4,484.8

(1) As of October 30, 2021, the current portion of outstanding debt includes the 2020 Term Loan - 5 Year Tranche, which is due within twelve months.

(1) As of April 30, 2022, the current portion of outstanding debt includes the 2020 Term Loan - 5 Year Tranche, which is due within twelve months.

The Company intends to repay the amount with operating cash flow.

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As part of the acquisition, the Company assumed $ 15.7 million principal amount of Inphi’s 0.75 % convertible senior notes due 2021 (the “Inphi 2021 Convertible Notes”) and $ 506.0 million principal amount of Inphi’s 0.75 % convertible senior notes due 2025 (the “Inphi 2025 Convertible Notes”, and together with the 2021 Notes, the “Inphi Convertible Notes”).

As of October 30, 2021, the Inphi Convertible Notes have been settled.

See “Note 3 - Business Combinations” for more information.

As of January 29, 2022, the Inphi Convertible Notes have been settled.

In connection with the acquisition, the Company entered into a series of financing arrangements from December 2020 through April 2021 as summarized below.

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The Company recognized a write-off of $ 11.4 million in capitalized debt issuance costs related to the termination of the bridge loan commitment during the quarter ended May 1, 2021.

In December 2020, the Company executed a debt agreement to obtain an $ 875.0 million 3-year term loan and an $ 875.0 million 5-year term loan.

In December 2020, the Company executed a debt agreement to obtain a 3-year $ 875.0 million term loan and a 5-year $ 875.0 million term loan.

The Company also executed a debt agreement to obtain a 5-year $ 750.0 million revolving credit facility in December 2020, replacing its previous $ 500.0 million revolving credit facility.

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domiciliation, the Company exchanged certain existing senior notes due in 2023 and 2028 that were previously issued by the Bermuda-domiciled Marvell Technology Group Ltd.

with like notes that are now issued by the Delaware-domiciled Marvell Technology, Inc.

(the “MTG Senior Notes”) with like notes that are now issued by the Delaware-domiciled Marvell Technology, Inc.

(the “MTI Senior Notes”).

Below is further discussion of the terms of the various debt agreements.

2020 Term Loan Agreement

On December 7, 2020, the Company entered into a term loan credit agreement with a lending syndicate led by JPMorgan Chase Bank, N.A (the “2020 Term Loan Agreement”) in order to finance the expected merger with Inphi.

The 2020 Term Loan Agreement provided for borrowings of $ 1.75 billion consisting of:

(i) $ 875.0 million loan with a three-year term from the funding date (the “3-Year Tranche Loan”) and (ii) $ 875.0 million loan with a five-year term from the funding date (the “5-Year Tranche Loan” and, together with the 3-Year Tranche Loan, the “2020 Term Loans”).

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

2020 Term Loan Agreement

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 “2020 Term Loan Agreement”) in order to finance the merger with Inphi.

The 2020 Term Loan Agreement provides for borrowings of $ 1.75 billion consisting of:

The 3-Year Tranche Loan has a stated floating interest rate which equates to reserve-adjusted LIBOR + 125 bps.

The effective interest rate for the 3-Year Tranche Loan was 1.655 % as of October 30, 2021.

The effective interest rate for the 3-Year Tranche Loan was 2.048 % as of April 30, 2022.

The 5-Year Tranche Loan has a stated floating interest rate which equates to reserve-adjusted LIBOR + 137.5 bps.

The effective interest rate for the 5-Year Tranche Loan was 1.798 % as of October 30, 2021.

The effective interest rate for the 5-Year Tranche Loan was 2.178 % as of April 30, 2022.

The 3-Year Tranche Loan does not require any scheduled principal payments prior to final maturity but does permit the Company to make early principal payments without premium or penalty.

During the quarter ended October 30, 2021, the Company repaid $ 140 million of the principal outstanding of the 3-Year Tranche Loan, and wrote off $ 1.1 million of associated unamortized debt issuance costs.

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 quarter ended October 30, 2021, the Company repaid $ 10.9 million of the principal outstanding of the 5-Year Tranche Loan.

During the quarter ended April 30, 2022, the Company repaid $ 10.9 million of the principal outstanding of the 5-Year Tranche Loan.

The 2020 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.

As of October 30, 2021, the Company has $ 1.6 billion Term Loan borrowings outstanding, and is in compliance with its debt covenants.

As of April 30, 2022, the Company has $ 1.6 billion Term Loan borrowings outstanding, and is in compliance with its debt covenants.

2020 Revolving Credit Facility

On December 7, 2020, the Company entered into a revolving line of credit agreement (the “2020 Revolving Credit Facility”) with a lending syndicate led by JPMorgan Chase Bank, N.A for borrowings of up to $ 750.0 million.

On December 7, 2020, the Company entered into a revolving line of credit agreement (the “2020 Revolving Credit Facility”) with a lending syndicate led by JP Morgan Chase Bank, N.A for borrowings of up to $ 750.0 million.

Borrowings from the 2020 Revolving Credit Facility are intended for general corporate use, which may include among other things, the financing of acquisitions, the refinancing of other indebtedness and the payment of transaction expenses related to the foregoing.

The 2020 Revolving Credit Facility has a five-year term and a stated floating interest rate which equates to reserve-adjusted LIBOR plus an applicable margin.

The Company may prepay any borrowings at any time without premium or penalty through December 7, 2025.

The Company may prepay any borrowings at any time without premium or penalty.

As of April 30, 2022, the 2020 Revolving Credit Facility is undrawn and will be available for draw down through December 7, 2025.

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 October 30, 2021.

On May 4, 2021, the Company drew down $ 75.0 million on the 2020 Revolving Credit Facility.

On July 6, 2021, the Company repaid the outstanding balance of the 2020 Revolving Credit Facility in full.

As of October 30, 2021, the 2020 Revolving Credit Facility is undrawn.

Subsequent to quarter end, on November 22, 2021, the Company drew down $ 90.0 million on the 2020 Revolving Credit Facility.

The Company intends to repay the drawn amount by the end of fiscal year 2022.

This annual rate was 0.175 % at April 30, 2022.

Subsequent to quarter end, on May 3, 2022, the Company drew down $ 150.0 million on the 2020 Revolving Credit Facility.

The Company intends to repay the drawn amount during the second quarter of fiscal 2023.

The 2020 Revolving Credit Facility requires that the Company and its subsidiaries comply with covenants relating to customary matters.

The covenants are consistent with the 2020 Term Loan covenants discussed above.

The Company currently carries debt that relies on LIBOR as the benchmark rate.

LIBOR is expected to be phased out as a benchmark rate starting at the end of 2021.

To the extent LIBOR ceases to exist, the 2020 Term Loans and 2020 Revolving Credit Facility agreements contemplate an alternative benchmark rate without the need for any amendment thereto.

The Company currently carries debt that relies on one-month LIBOR as the benchmark rate.

The one-month LIBOR is expected to cease publication after June 30, 2023.

To the extent the one-month LIBOR ceases to exist, the 2020 Term Loans and 2020 Revolving Credit Facility agreements contemplate an alternative benchmark rate without the need for any amendment thereto.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

2026, 2028, and 2031 Senior Unsecured Notes

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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 and the transfer restrictions and registration rights applicable to the Senior Notes issued in April 2021 do not apply to the new notes.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The 2026 Senior Notes mature on April 15, 2026, the 2028 Senior Notes mature on April 15, 2028, and the 2031 Senior Notes mature on April 15, 2031.

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The indenture governing the 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 October 30, 2021, the Company had $ 2.0 billion Senior Notes borrowings outstanding.

As of April 30, 2022, the Company had $ 2.0 billion Senior Notes borrowings outstanding.

2023 and 2028 Senior Unsecured Notes

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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 of 1933 and the transfer restrictions and registration rights applicable to the MTI Senior Notes issued in May 2021 do not apply to the new notes.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The MTI 2023 Notes mature on June 22, 2023 and the MTI 2028 Notes mature on June 22, 2028.

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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 October 30, 2021, the Company had $ 1.0 billion MTG/MTI Senior Notes borrowings outstanding.

As of April 30, 2022, the Company had $ 1.0 billion MTG/MTI Senior Notes borrowings outstanding.

Inphi Convertible Notes

As a result of the Inphi acquisition, the Company assumed all of Inphi’s outstanding convertible notes.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Inphi 2021 Convertible Notes

In September 2016, Inphi issued $ 287.5 million of 0.75 % convertible senior notes due 2021.

The Inphi 2021 Convertible Notes are governed by the terms of an indenture dated September 12, 2016 (the “Inphi 2021 Convertible Notes Indenture”).

The Inphi 2021 Convertible Notes matured on September 1, 2021, unless earlier converted or repurchased.

Interest on the Inphi 2021 Convertible Notes was payable on March 1 and September 1 of each year.

Under the Inphi 2021 Convertible Notes Indenture, on or after March 1, 2021, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their notes at any time.

Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election.

The Inphi 2021 Convertible Notes are not redeemable at the Company’s option prior to maturity.

The initial conversion rate at issuance in September 2016 was 17.7508 shares of Inphi common stock per $1,000 principal amount of Inphi 2021 Convertible Notes, which represented an initial conversion price of approximately $ 56.34 per Inphi share.

The conversion rate for the Inphi 2021 Convertible Notes is subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest.

In addition, following certain fundamental changes that occur prior to the maturity date, the Company will increase the conversion rate of the Inphi 2021 Convertible Notes for a holder who elects to convert in connection with such a fundamental change in certain circumstances.

Upon the occurrence of certain fundamental changes, the holders of the Inphi 2021 Convertible Notes may require the Company to repurchase all or a portion of their Inphi 2021 Convertible Notes for cash at a price equal to 100 % of the principal amount of the Inphi 2021 Convertible notes, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.

The Inphi 2021 Convertible Notes are not redeemable at the Company’s option prior to maturity.

As part of the Inphi acquisition, the Company assumed $ 15.7 million principal amount of Inphi’s 2021 Convertible Notes with a fair value of $ 48.0 million.

The Inphi acquisition constituted a fundamental change under the Inphi 2021 Convertible Notes Indenture.

As a result, the Inphi 2021 Convertibles Notes were convertible into Inphi conversion units of 17.7522 per $1,000 in principal amount of such notes from April 20, 2021 through June 3, 2021.

Based on the terms of the Inphi merger agreement, the holders of the Inphi 2021 Convertible Notes received 41.2384 shares of the Company’s common stock and $1,171.65 in cash per $1,000 in principal amount of such notes upon conversion.

From June 4, 2021 through August 31, 2021, the Inphi 2021 Convertible Notes were convertible into Inphi conversion units of 17.7508 per $1,000 in principal amount of such notes.

Based on the terms of the Inphi merger agreement, the holders of the Inphi 2021 Convertible Notes would receive 41.2351 shares of the Company’s common stock and $1,171.55 in cash per $1,000 in principal amount of such notes upon conversion.

The Company has elected to measure the Inphi 2021 Convertible Notes at fair value.

A total of $ 9.6 million in aggregate principal of the Inphi 2021 Convertible Notes was settled pursuant to the Exchange Agreements (discussed below).

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Inphi 2025 Convertible Notes

In April 2020, Inphi issued $ 506.0 million 0.75 % convertible senior notes due 2025.

The Inphi 2025 Convertible Notes are governed by an indenture dated April 24, 2020 (the “Inphi 2025 Notes Indenture”).

The Inphi 2025 Convertible Notes will mature on April 15, 2025, unless earlier converted or repurchased.

Interest on the Inphi 2025 Convertible Notes is payable on April 15 and October 15 of each year.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Under the Inphi 2025 Notes Indenture, the Inphi 2025 Convertible Notes are convertible at the option of the holders at any time, prior to the close of business on the business day immediately preceding October 15, 2024, only under the following circumstances:

(i) during any calendar quarter commencing after the calendar quarter ending on June 30, 2020 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock, for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price for the Inphi 2025 Notes on each applicable trading day;

(ii) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading per $1,000 principal amount of Inphi 2025 Convertible Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the common stock and the conversion rate on each such trading day;

(iii) if the Company calls any or all of the Inphi 2025 Convertible Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date;

or (iv) upon the occurrence of specified corporate events.

On or after October 15, 2024 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Inphi 2025 Convertible Notes at any time, regardless of the foregoing circumstances.

Upon the occurrence of certain fundamental changes, the holders of the Inphi 2025 Convertible Notes may require the Company to repurchase all or a portion of the Inphi 2025 Convertible Notes for cash at a price equal to 100 % of the principal amount of the Inphi 2025 Convertible Notes, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.

The initial conversion rate at issuance in April 2020 was 8.0059 shares of Inphi common stock per $1,000 principal amount of Inphi 2025 Convertible Notes, which represented an initial conversion price of approximately $ 124.91 per Inphi share.

The conversion rate for the Inphi 2025 Convertible Notes is subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest.

In addition, following certain fundamental changes that occur prior to the maturity date or following the Company’s issuance of a notice of redemption, the Company will, in certain circumstances, increase the conversion rate of the Inphi 2025 Convertible Notes for a holder who elects to convert in connection with such a fundamental change or notice of redemption, as the case may be.

As part of the Inphi acquisition, the Company assumed $ 506.0 million in principal of Inphi 2025 Convertible Notes with a fair value of $ 750.2 million.

The Inphi acquisition constituted a fundamental change under the Inphi 2025 Convertible Notes Indenture.

As a result, the Inphi 2025 Convertible Notes were convertible into Inphi conversion units of 8.595 per $1,000 in principal amount of such notes.

Based on the terms of the Inphi merger agreement, the holders of the Inphi 2025 Convertible Notes would receive 19.9662 shares of the Company’s common stock and $ 567.27 in cash per $1,000 in principal amount of such notes upon conversion.

A total of $ 199.5 million in aggregate principal of the Inphi 2025 Convertible Notes was settled pursuant to the Exchange Agreements (discussed below).

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Between May 2, 2021 and June 3, 2021, $ 192.5 million in aggregate principal of the Inphi 2025 Convertible Notes was converted pursuant to the contractual terms of the Inphi 2025 convertible notes indenture into 3.8 million shares of the Company’s common stock and $ 109.2 million in cash.

In accounting for the Inphi 2025 Convertible Notes as of April 20, 2021, the Company separated the Inphi 2025 Convertible Notes into liability and equity components.

The carrying amount of the liability component was calculated by measuring the estimated fair value of a similar liability that does not have an associated convertible feature.

The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the fair value of the Inphi 2025 Convertible Notes as a whole.

The fair value of $ 750.2 million was accordingly allocated between debt for $ 506.0 million and stockholders’ equity for $ 244.2 million.

As of October 30, 2021, there was no outstanding balance of Inphi 2025 Convertible Notes.

After these conversions, there was no outstanding balance of Inphi 2025 Convertible Notes.

Inphi Capped Calls

In connection with the issuance of each of the Inphi Convertible Notes, Inphi entered into capped call transactions (the “Inphi 2021 Capped Calls” and the “Inphi 2025 Capped Calls,” collectively, the “Inphi Capped Calls”) in private transactions.

Under the Inphi Capped Calls, Inphi purchased capped call options that in aggregate relate to 100 % of the total number of shares of the Company’s common stock underlying the Inphi Convertible Notes, with a strike price approximately equal to the conversion price of the Inphi 2021 Convertible Notes and the Inphi 2025 Convertible Notes, respectively, and with a capped price equal to $ 73.03 per Inphi share and $ 188.54 per Inphi share, respectively.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The purchased Inphi Capped Calls allowed Inphi to receive shares of its common stock and/or cash from counterparties equal to the amounts of common stock and/or cash related to the excess of the market price per share of the common stock, as measured under the terms of the Inphi Capped Calls, over the strike prices of the Inphi Capped Calls during the relevant valuation period.

The purchased Inphi Capped Calls were intended to reduce the potential dilution to common stock upon future conversion of the Inphi 2021 Convertible Notes and Inphi 2025 Convertible Notes by effectively increasing the initial conversion price to approximately $ 73.03 and $ 188.54 , respectively, as well as to offset potential cash payments that Inphi would be required to make in excess of the principal amount of the Inphi Convertible Notes in applicable events.

The Inphi Capped Calls were separate transactions entered into by Inphi with the option counterparties, are not part of the terms of the Inphi Convertible Notes, and will not change the holders’ rights under the Inphi Convertible Notes.

In connection with the Inphi acquisition, the Company entered into unwind agreements related to the Inphi Capped Calls.

Based on the terms of the unwind agreements, the Inphi Capped Calls do not qualify for equity classification.

As such, the Company has classified the Inphi Capped Calls as assets and included in “prepaid expenses and other current assets” in the unaudited condensed consolidated balance sheet.

Under the unwind agreements, the Company and the counterparties agreed to settle a portion of Inphi Capped Calls for a fixed payment of $ 74.1 million, which were settled on April 23, 2021.

The remaining Inphi Capped Calls provide for variable cash settlement based on the Company’s stock price.

These capped calls qualify as derivatives and, accordingly, the Company measures these capped calls at fair value, with changes in fair value reported in earnings.

The remaining Inphi Capped Calls provided for variable cash settlement based on the Company’s stock price.

The Company reports cash flows from capped calls in cash flows from financing activities.

In connection with the Exchange Agreements (discussed below), a portion of the remaining Inphi Capped Calls were settled for $ 35.5 million on April 29, 2021.

As of October 30, 2021, there was no outstanding balance of Inphi Capped Calls.

As of April 30, 2022, there was no outstanding balance of Inphi Capped Calls.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Exchange Agreements

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Under the terms of the Exchange Agreements, the Noteholders agreed to exchange approximately $ 9.6 million in aggregate principal amount of Inphi 2021 Convertible Notes and $ 199.5 million in aggregate principal amount of Inphi 2025 Convertible Notes for a number of shares of the Company’s common stock that was partially based on a trailing daily volume-weighted average of the Company’s stock price.

The Exchange Agreements were accounted for as liabilities and measured at fair value, with changes in fair value recorded in earnings.

For the three months ended May 1, 2021, the Company recognized interest expense of $ 5.0 million on the remeasurement of the Exchange Agreements in its unaudited condensed statements of operations.

The Exchange Agreements were settled on April 29, 2021.

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Interest Expense and Future Contractual Maturities

During the three and nine months ended October 30, 2021, the Company recognized $ 33.6 million and $ 86.6 million, respectively, of interest expense in its unaudited condensed consolidated statements of operations related to interest, amortization of debt issuance costs and accretion of discount associated with the outstanding borrowings.

During the three and nine months ended October 31, 2020, the Company recognized $ 14.1 million and $ 43.6 million, respectively, of interest expense in its unaudited condensed consolidated statements of operations related to interest, amortization of debt issuance costs and accretion of discount associated with the outstanding borrowings.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

As of October 30, 2021, the aggregate future contractual maturities of the Company’s outstanding debt, at face value, were as follows (in thousands):

During the three months ended April 30, 2022, the Company recognized $ 32.9 million of interest expense in its unaudited condensed consolidated statements of operations related to interest, amortization of debt issuance costs and accretion of discount associated with the outstanding term loans and senior notes.

During the three months ended May 1, 2021, the Company recognized $ 22.1 million of interest expense in its unaudited condensed consolidated statements of operations related to interest, amortization of debt issuance costs and accretion of discount associated with the outstanding term loans and senior notes.

As of April 30, 2022, the aggregate future contractual maturities of the Company’s outstanding debt, at face value, were as follows (in millions):

Fiscal Year Amount

Remainder of 2023 $ 54.7

2024 1,322,452

Thereafter 1,999.9

Total $ 4,577.1

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 thousands, except percentages):

Three Months Ended Nine Months Ended

2021 % of Total October 31,

2020 % of Total October 30,

2021 % of Total October 31,

2020 % of Total

Net revenue by end market:

Data center $ 499,748 41 % $ 239,159 32 % $ 1,210,536 39 % $ 771,546 36 %

Carrier infrastructure 215,108 18 % 168,584 23 % 579,330 19 % 433,269 20 %

Enterprise networking 247,210 20 % 158,933 21 % 644,786 21 % 475,313 22 %

Consumer 182,535 15 % 152,269 20 % 514,581 16 % 406,930 19 %

Automotive/industrial 66,644 6 % 31,198 4 % 170,172 5 % 84,023 3 %

$ 1,211,245 $ 750,143 $ 3,119,405 $ 2,171,081

The Company classifies end market revenue by using estimates and assumptions based on historical experience and knowledge of current conditions, given available information.

The following table summarizes net revenue disaggregated by primary geographical market based on destination of shipment (in thousands, except percentages):

Three Months Ended Nine Months Ended

2021 % of Total October 31,

2020 % of Total October 30,

2021 % of Total October 31,

2020 % of Total

Net revenue based on destination of shipment:

China $ 558,899 46 % $ 324,927 43 % $ 1,388,292 45 % $ 908,255 42 %

United States 123,969 10 % 73,751 10 % 334,545 11 % 241,814 11 %

Thailand 97,381 8 % 55,617 7 % 258,158 8 % 183,625 8 %

Malaysia 65,620 5 % 73,582 10 % 196,633 6 % 198,436 9 %

Japan 68,195 6 % 32,811 4 % 168,427 5 % 104,676 5 %

Philippines 52,987 4 % 44,356 6 % 156,309 5 % 118,485 5 %

Other 244,194 21 % 145,099 20 % 617,041 20 % 415,790 20 %

$ 1,211,245 $ 750,143 $ 3,119,405 $ 2,171,081

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

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 thousands, except percentages):

Three Months Ended Nine Months Ended

2021 % of Total October 31,

2020 % of Total October 30,

2021 % of Total October 31,

2020 % of Total

Net revenue by customer type:

Direct customers $ 893,495 74 % $ 573,759 76 % $ 2,284,589 73 % $ 1,646,511 76 %

Distributors 317,750 26 % 176,384 24 % 834,816 27 % 524,570 24 %

$ 1,211,245 $ 750,143 $ 3,119,405 $ 2,171,081

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 nine months ended October 30, 2021 that was included in the deferred revenue balance at January 30, 2021 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.

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 unaudited condensed consolidated statements of operations.

Restructuring

The Company continuously evaluates its existing operations to increase operational efficiency, decrease costs and increase profitability.

A restructuring plan was initiated during the first quarter of fiscal 2022 (the “Fiscal 2022 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 $ 5.9 million and $ 31.0 million for the three and nine months ended October 30, 2021, respectively, which includes $ 1.2 million and $ 21.1 million of charges related to the Fiscal 2022 Plan.

The Company expects to complete these restructuring actions by the end of fiscal 2023.

In prior years, the Company initiated restructuring plans in order to realign the organization and enable further investment in key priority areas.

Restructuring charges were mainly comprised of severance and other one-time termination benefits, facility closures where sites were redundant within the same region or no longer suitably sized for the local employee base, and other costs.

These plans are substantially complete.

The Company recorded restructuring related charges of $ 19.3 million and $ 170.8 million for the three and nine months ended October 31, 2020, respectively.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The following table provides a summary of restructuring related charges, as presented in the unaudited condensed consolidated statements of operations (in thousands):

Three Months Ended Nine Months Ended

October 30, 2021 October 31, 2020 October 30, 2021 October 31, 2020

Cost of goods sold $ — $ — $ — $ 9,594

Restructuring related charges 5,861 19,312 31,041 161,189

$ 5,861 $ 19,312 $ 31,041 $ 170,783

The following table sets forth a reconciliation of the beginning and ending restructuring liability balances by each major type of cost associated with the restructuring charges (in thousands):

Employee Severance Other Total

Liability at January 30, 2021 $ 5,596 $ 5,204 $ 10,800

Charges 24,215 6,826 31,041

Cash payments ( 22,308 ) ( 5,888 ) ( 28,196 )

Non-cash items — ( 2,661 ) ( 2,661 )

Liability at October 30, 2021

$ 7,503 $ 3,481 $ 10,984

The current and non-current portions of the restructuring liability at October 30, 2021 of $ 9.7 million and $ 1.3 million are included as a component of accrued liabilities and other non-current liabilities respectively in the accompanying unaudited condensed consolidated balance sheets.

Supplemental Financial Information (in thousands)

Consolidated Balance Sheets

2021 January 30,

Work-in-process $ 516,649 $ 187,351

Finished goods 111,951 80,877

Inventories $ 628,600 $ 268,228

The inventory balance at October 30, 2021 incl udes $ 41.9 million relat ed to the remaining inventory fair value adjustment from the Innovium acquisition.

2021 January 30,

Property and equipment, net:

Machinery and equipment $ 853,484 $ 693,689

Land, buildings, and leasehold improvements 291,409 284,532

Computer software 107,712 103,789

Furniture and fixtures 28,732 26,990

1,281,337 1,109,000

Accumulated depreciation and amortization ( 837,334 ) ( 782,875 )

Property and equipment, net $ 444,003 $ 326,125

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

2021 January 30,

Other non-current assets:

Technology and other licenses $ 506,145 $ 242,244

Operating right-of-use assets 153,780 101,411

Prepaid ship and debits 139,754 131,657

Prepayments on supply capacity reservation agreements 30,250 —

Non-marketable equity investments 26,751 7,646

Other 58,810 58,611

Other non-current assets $ 915,490 $ 541,569

2021 January 30,

Accrued liabilities:

Variable consideration estimates (1) $ 197,217 $ 180,995

Technology license obligations 104,716 71,130

Deferred non-recurring engineering credits 57,562 37,300

Lease liabilities - current portion 41,868 32,461

Deferred revenue 37,389 16,146

Accrued interest 20,344 8,709

Accrued royalty 15,920 12,740

Accrued legal reserve 9,003 50,101

Other 37,886 26,034

Accrued liabilities $ 521,905 $ 435,616

(1) Variable consideration estimates consist of estimated customer returns, price discounts, price protection, rebates, and stock rotation programs.

2021 January 30,

Other non-current liabilities

Technology license obligations $ 308,287 $ 86,241

Lease liabilities-non current 150,847 104,417

Deferred tax liabilities 56,262 22,359

Non-current income tax payable 34,237 22,526

Other 41,007 23,310

Other non-current liabilities $ 590,640 $ 258,853

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Accumulated Other Comprehensive Income

As of October 30, 2021, there are no changes in accumulated other comprehensive income (loss) by components.

The changes in accumulated other comprehensive income (loss) by components for the comparative period are presented in the following table:

Unrealized Gain

(Loss) on Cash

Balance at February 1, 2020 $ —

Other comprehensive income before reclassifications 1,214

Amounts reclassified from accumulated other comprehensive income ( 1,214 )

Net current-period other comprehensive income, net of tax —

Balance at Balance at October 31, 2020 $ —

Consolidated Statements of Cash Flows

Noncash consideration paid for the acquisitions of Inphi and Innovium was $ 7.2 billion during the nine months ended October 30, 2021.

Share Repurchase Program

On November 17, 2016, the Company announced that its Board of Directors authorized a $ 1.0 billion share repurchase plan.

The newly authorized stock repurchase program replaced in its entirety the prior $ 3.25 billion stock repurchase program.

On October 16, 2018, the Company announced that its Board of Directors authorized a $ 700 million addition to the balance of its existing share repurchase program.

As of October 30, 2021, there was $ 564.5 million remaining available for future share repurchases.

The Company intends to effect share 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 share repurchase program will be subject to market conditions and other factors, and does not obligate the Company to repurchase any dollar amount or number of its common shares and the repurchase program may be extended, modified, suspended or discontinued at any time.

The Company temporarily suspended the share repurchase program in late March 2020 to preserve cash during the COVID-19 pandemic.

The Company is focused on reducing its debt and de-levering its balance sheet.

As a result, the Company did no t repurchase any shares during the three and nine months ended October 30, 2021.

The Company repurchased 1.3 million of its common shares for $ 25.2 million during the nine months ended October 31, 2020.

The Company records all repurchases, as well as investment purchases and sales, based on their trade date.

The repurchased shares are retired immediately after repurchases are completed.

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.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

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 yields.

In addition, the severance pay fund is classified as a Level 2 asset 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 and liabilities that are measured at fair value on a recurring basis.

The tables do not include assets and liabilities that are measured at historical cost or any basis other than fair value (in thousands):

Fair Value Measurements at October 30, 2021

Level 1 Level 2 Level 3 Total

Items measured at fair value on a recurring basis:

Cash equivalents:

Time deposits $ — $ 167,636 $ — $ 167,636

Other non-current assets:

Marketable equity investments 1,234 — — 1,234

Severance pay fund — 697 — 697

Total assets $ 1,234 $ 168,333 $ — $ 169,567

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.

They 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 October 30, 2021, non-marketable equity investments had a carrying value of $ 26.8 million and are included in other non-current assets in the Company’s unaudited condensed consolidated balance sheets.

Fair Value Measurements at January 30, 2021

Level 1 Level 2 Level 3 Total

Items measured at fair value on a recurring basis:

Cash equivalents:

Time deposits $ — $ 114,645 $ — $ 114,645

Other non-current assets:

Severance pay fund — 623 — 623

Total assets $ — $ 115,268 $ — $ 115,268

Fair Value of Debt

The Company classified the 2020 Term Loan, the 2023 Notes, the 2026 Notes, 2028 Notes, and 2031 Notes as Level 2 in the fair value measurement hierarchy.

The carrying value of the 2020 Term Loan approximates its fair value as the 2020 Term Loan is carried at a market observable interest rate that resets periodically.

The estimated aggregate fair value of the unsecured senior notes was $ 3.1 billion at October 30, 2021 and $ 1.1 billion at January 30, 2021, and were classified as Level 2 as there are quoted prices from less active markets for the notes.

Commitments and Contingencies

Warranty Obligations

The Company’s products carry a standard one-year warranty with certain exceptions in which the warranty period can extend to more than one year based on contractual agreements.

The Company’s warranty expense has not been material in the periods presented.

The Company’s commitments primarily consist of wafer purchase obligations with foundry partners, supply capacity reservation payment commitments with foundries and test & assembly partners, and technology license fee payment obligations.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Total future unconditional purchase commitments as of October 30, 2021 are as follows (in thousands):

Total future unconditional purchase commitments as of April 30, 2022 are as follows (in millions):

Fiscal Year Purchase Commitments to Foundries and Test & Assembly Partners

9 unchanged sentences

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.

The Company entered into manufacturing supply capacity reservation agreements with foundries and test & assembly suppliers this fiscal year due to the current global supply shortage environment.

The Company entered into manufacturing supply capacity reservation agreements with foundries and test & assembly suppliers during the current and prior fiscal year due to the current global supply shortage environment.

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 four to ten years .

1 unchanged sentence

If the Company does not meet the purchase level commitments, the agreements either require the Company to pay a fee for the difference between the actual purchases and the purchase commitment or lose priority to reserved capacity for a period of time.

The Company currently estimates that it has agreed to purchase level commitments of at least $ 2.4 billion of wafers, substrates, and other manufacturing products for the fiscal years 2022 through 2031 under the capacity reservation agreements.

In addition, t otal fees payable under these arrangements are $ 213.5 million in fiscal years 2022 through 2026.

The Company currently estimates that it has agreed to purchase level commitments of at least $ 2.2 billion of wafers, substrates, and other manufacturing products for the remainder of fiscal 2023 through fiscal 2032 under the capacity reservation agreements.

In addition, t otal fees and refundable deposits payable under these arrangements are $ 143.0 million for the remainder of fiscal 2023 through fiscal 2026.

Such purchase commitments are summarized in the preceding table.

8 unchanged sentences

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 any Legal Matter involves judgments, estimates and inherent uncertainties.

In the first quarter of fiscal 2023, the Company reserved $ 15 million in relation to an on-going contractual and intellectual property disagreement with a customer;

this disagreement remains unresolved as of the first quarter ended April 30, 2022.

The ultimate outcome of this and other Legal Matters involves judgments, estimates and inherent uncertainties.

An unfavorable outcome in a Legal Matter, particularly in a patent dispute, could require the Company to pay damages or could prevent the Company from selling some of its products in certain jurisdictions.

4 unchanged sentences

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 Bermuda.

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.

12 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Stockholders ’ Equity

Innovium Acquisition-related Equity Awards and the Innovium 2015 EIP

Following the Innovium acquisition and in accordance with the Innovium merger agreement, certain outstanding options to purchase shares of Innovium common stock and certain restricted stock units with respect to Innovium common stock, each granted under the Innovium Amended and Restated 2015 Stock Incentive Plan (“Innovium 2015 EIP”), were assumed by the Company and converted into options to purchase common shares of the Company and restricted stock units with respect to common shares of the Company, respectively .

The Company filed a registration statement on October 5, 2021 to register 1,232,805 common shares of the Company, issuable under the Innovium 2015 EIP, comprised of 421,648 common shares issuable pursuant to outstanding but unexercised options under the Innovium 2015 EIP and 811,157 common shares issuable pursuant to outstanding unvested restricted stock units under the Innovium 2015 EIP.

The Innovium 2015 EIP was adopted by Innovium on January 2015 and amended and restated in September 2020.

The Innovium 2015 EIP provided for the grants of restricted stock, stock appreciation rights and stock unit awards to employees, non-employee directors, advisors and consultants.

Awards under the Innovium 2015 EIP generally vest over 3 to 4 years.

The awards under the Innovium 2015 EIP assumed by the Company in the Innovium acquisition were measured at the acquisition date based on the estimated fair value of $ 80.9 million.

A portion of that fair value, $ 39.8 million, which represented the pre-acquisition service provided by employees to Innovium, was included in the total consideration transferred as part of the acquisition.

As of the acquisition date, the remaining portion of the fair value of those awards was $ 41.1 million, representing post-acquisition share-based compensation expense that will be recognized as these employees provide service over the remaining vesting periods.

During the three and nine months ended October 30, 2021, the Company recognized $ 4.1 million of share-based compensation expense in connection with the acquisition of Innovium, of which $ 2.9 million was due to the accelerated vesting of outstanding equity awards of certain Innovium employees.

During the three and nine months ended October 30, 2021, Innovium merger equity consideration related tax withholdings of $ 10.6 million were included as a component of tax withholdings for net share settlement of restricted stock units in the accompanying unaudited condensed consolidated statement of stockholders’ equity.

Inphi Acquisition-related Equity Awards and the Inphi 2010 EIP

Following the Inphi acquisition and in accordance with the Inphi merger agreement, certain outstanding options to purchase shares of Inphi common stock and certain restricted stock units with respect to Inphi common stock, each granted under the Inphi Amended and Restated 2010 Stock Incentive Plan (“Inphi 2010 EIP”), were assumed by the Company and converted into options to purchase common shares of the Company and restricted stock units with respect to common shares of the Company, respectively.

The Company filed a registration statement on April 20, 2021 to register 10,301,589 common shares of the Company, issuable under the Inphi 2010 EIP, comprised of 127,249 common shares issuable pursuant to outstanding but unexercised options under the Inphi 2010 EIP, 10,040,693 common shares issuable pursuant to outstanding unvested restricted stock units under the Inphi 2010 EIP, and 133,647 common shares issuable pursuant to outstanding unvested performance stock units under the Inphi 2010 EIP.

The Inphi 2010 EIP was adopted by Inphi on June 7, 2010.

The 2010 Plan provided for the grants of restricted stock, stock appreciation rights and stock unit awards to employees, non-employee directors, advisors and consultants.

Awards under the Inphi 2010 EIP generally vest over 3 to 4 years.

The awards under the Inphi 2010 EIP assumed by the Company in the Inphi acquisition were measured at the acquisition date based on the estimated fair value of $ 589.7 million.

A portion of that fair value, $ 161.7 million, which represented the pre-acquisition service provided by employees to Inphi, was included in the total consideration transferred as part of the acquisition.

As of the acquisition date, the remaining portion of the fair value of those awards was $ 428.0 million, representing post-acquisition share-based compensation expense that will be recognized as these employees provide service over the remaining vesting periods.

Business Combinations

On October 5, 2021, the Company completed the acquisition of Innovium, Inc.

The Innovium acquisition was primarily intended to allow the Company to immediately participate in the fastest growing segment of the switch market with a cloud-optimized solution.

Goodwill recorded for the Innovium acquisition is not expected to be deductible for tax purposes.

The following table summarized the total merger consideration (in millions):

Common stock issued $ 971.0

Stock consideration for replacement equity awards attributable to pre-combination service 33.2

Total merger consideration $ 1,004.2

Any such revisions or changes may be material.

In accordance with U.S.

The excess purchase price over those fair values 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.

The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates, especially with respect to intangible assets.

Acquisition-related costs are expensed in the periods in which such costs are incurred.

See “Note 7 – Goodwill and Acquired Intangible Assets, Net” for additional information.

The purchase price allocation is as follows (in millions):

Previously Reported

January 29, 2022 (Provisional)

Cash and cash equivalents $ 60.4

Inventories 70.0

Goodwill 462.4

Acquired intangible assets, net 433.0

Other, net ( 21.6 )

Total merger consideration $ 1,004.2

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Summary of Share-based Compensation Expense

The following table summarizes share-based compensation expense (in thousands):

Three Months Ended Nine Months Ended

2021 October 31,

2020 October 30,

2021 October 31,

Cost of goods sold $ 9,370 $ 4,435 $ 21,838 $ 12,055

Research and development 75,514 36,856 184,577 114,349

Selling, general and administrative 34,206 18,496 136,373 55,656

Total share-based compensation $ 119,090 $ 59,787 $ 342,788 $ 182,060

Share-based compensation capitalized in inventory was $ 14.6 million at October 30, 2021 and $ 4.3 million at January 30, 2021.

The provisional amounts presented in the table above pertained to the preliminary purchase price allocation reported in the Company’s Form 10-K for the year ended January 29, 2022.

There have been no measurement period adjustments during the first quarter ended April 30, 2022.

The Company incurred total acquisition related costs of $ 11.9 million which were recorded in selling, general and administrative expense in the unaudited condensed consolidated statements of operations.

On April 20, 2021, the Company completed the acquisition of Inphi (the “Inphi acquisition”).

Inphi is a global leader in high-speed data movement enabled by optical interconnects.

The merger consideration paid in cash was funded with a combination of cash on hand and funds from the Company’s debt financing.

See “Note 4 – Debt” for additional information.

Goodwill recorded for the Inphi acquisition is not expected to be deductible for tax purposes.

The following table summarized the total merger consideration (in millions):

Cash consideration $ 3,673.2

Common stock issued 5,917.8

Stock consideration for replacement equity awards attributable to pre-combination service 82.3

Equity component of convertible debt 244.2

Total merger consideration $ 9,917.5

In accordance with U.S.

GAAP requirements for business combinations, the Company allocated the fair value of the purchase consideration to the tangible assets, liabilities and intangible assets acquired, including IPR&D, generally based on their estimated fair values.

The excess purchase price over those fair values 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.

The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates, especially with respect to intangible assets.

Acquisition-related costs are expensed in the periods in which such costs are incurred.

See “Note 7 – Goodwill and Acquired Intangible Assets, Net” for additional information.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The purchase price allocation is as follows (in millions):

Previously Reported

January 29, 2022 (Provisional) Measurement Period Adjustment April 30, 2022

Cash and cash equivalents $ 72.3 $ — $ 72.3

Accounts receivable, net 99.7 — 99.7

Inventories 270.4 — 270.4

Prepaid expenses and other current assets 213.3 — 213.3

Property and equipment, net 98.5 — 98.5

Acquired intangible assets, net 4,420.0 — 4,420.0

Other non-current assets 98.8 ( 2.2 ) 96.6

Goodwill 5,686.2 2.2 5,688.4

Accounts payable and accrued liabilities ( 189.8 ) — ( 189.8 )

Convertible debt - short-term ( 313.7 ) — ( 313.7 )

Convertible debt - long-term ( 240.3 ) — ( 240.3 )

Other non-current liabilities ( 297.9 ) — ( 297.9 )

Total merger consideration $ 9,917.5 $ — $ 9,917.5

The provisional amounts presented in the table above pertained to the preliminary purchase price allocation reported in the Company’s Form 10-K for the year ended January 29, 2022.

The measurement period adjustments were associated with change in deferred tax assets as a result of changes in estimates related to finalizing Inphi’s short period 2021 U.S.

The Company does not believe that the measurement period adjustment had a material impact on its consolidated statements of operations, balance sheets, or cash flows in any periods previously reported.

The Company incurred $ 50.8 million in acquisition related costs which were recorded in selling, general and administrative expense.

The Company also incurred $ 39.8 million of aggregate debt financing costs.

As of April 30, 2022, $ 2.4 million is included in short-term debt, and $ 28.4 million is included in long-term debt on the accompanying unaudited condensed consolidated balance sheets.

See “Note 4 – Debt” for additional information.

Additionally, the Company incurred $ 8.2 million of equity issuance costs, which were recorded in additional paid-in capital in the unaudited condensed consolidated balance sheets.

Unaudited Supplemental Pro Forma Information

The pro forma adjustments are based upon currently available information and certain assumptions the Company believes are reasonable under the circumstances.

For fiscal 2021, non-recurring pro forma adjustments directly attributable to the Innovium and Inphi acquisitions in the pro forma information presented below included (i) share-based compensation expense of $ 43.8 million, (ii) the purchase accounting effect of inventories acquired of $ 13.7 million, (iii) interest expense of $ 11.4 million, and (iv) transaction costs of $ 46.3 million.

The unaudited supplemental pro forma information presented below is for informational purposes only and is not necessarily indicative of our unaudited condensed consolidated results of operations of the combined business had the Inphi acquisition actually occurred at the beginning of fiscal 2021 or of the results of our future operations of the combined business.

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

The unaudited supplemental pro forma financial information for the periods presented is as follows (in millions):

Three Months Ended

Pro forma net revenue $ 1,007.4

Pro forma net loss $ ( 112.7 )

Goodwill and Acquired Intangible Assets, Net

Goodwill represents the excess of the purchase price over the fair value of net tangible and identifiable intangible assets acquired in a business combination.

In March and April 2022, the Company completed the acquisition of two semiconductor design services companies located in India, for purchase consideration of $ 33.7 million, primarily for the purpose of expanding engineering resources to address customer design opportunities, of which $ 25.8 million was allocated to goodwill.

The carrying value of goodwill as of April 30, 2022 and January 29, 2022 is $ 11.5 billion.

See “Note 6 – Business Combinations” for discussion of acquisitions and changes to the carrying value of goodwill.

Acquired Intangible Assets, Net

As of April 30, 2022 and January 29, 2022, net carrying amounts excluding fully amortized intangible assets are as follows (in millions, except for weighted-average remaining amortization period):

April 30, 2022

Gross Carrying Amounts Accumulated Amortization Net Carrying Amounts Weighted-Average Remaining Amortization Period (Years)

Developed technologies $ 4,730.0 $ ( 1,494.1 ) $ 3,235.9 4.94

Customer contracts and related relationships 2,179.0 ( 599.3 ) 1,579.7 4.96

Trade names 66.0 ( 22.5 ) 43.5 3.73

Total acquired amortizable intangible assets $ 6,975.0 $ ( 2,115.9 ) $ 4,859.1 4.94

IPR&D 1,029.0 — 1,029.0 n/a

Total acquired intangible assets $ 8,004.0 $ ( 2,115.9 ) $ 5,888.1

January 29, 2022

Gross Carrying Amounts Accumulated Amortization Net Carrying Amounts Weighted-Average Remaining Amortization Period (Years)

Developed technologies $ 4,744.1 $ ( 1,333.7 ) $ 3,410.4 5.17

Customer contracts and related relationships 2,184.0 ( 519.6 ) 1,664.4 5.21

Trade names 73.0 ( 26.2 ) 46.8 3.95

Order backlog 70.0 ( 67.2 ) 2.8 0.03

Total acquired amortizable intangible assets $ 7,071.1 $ ( 1,946.7 ) $ 5,124.4 5.17

IPR&D 1,029.0 — 1,029.0 n/a

Total acquired intangible assets $ 8,100.1 $ ( 1,946.7 ) $ 6,153.4

MARVELL TECHNOLOGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ‑ (Continued)

Useful lives for these IPR&D projects are expected to range between 3 to 10 years.

In the event the IPR&D is abandoned, the related assets will be written off.

Amortization expense for acquired intangible assets for the three months ended April 30, 2022 and May 1, 2021 was $ 272.5 million and $ 128.6 million, respectively.

The following table presents the estimated future amortization expense of acquired amortizable intangible assets as of April 30, 2022 (in millions):

Fiscal Year Amount

Remainder of 2023 $ 785.6

Thereafter 320.2