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Matt Murphy, CEO, Marvell Technology

Scott Malin | CNBC

Shares of Marvel technology A significant overnight rally continued on Friday morning, beating the top and bottom lines by nearly 25% on quarterly earnings results.

On Thursday, the chipmaker posted adjusted earnings of 31 cents per share for the first quarter, topping the Refinitiv Consensus estimate of 29 cents per share. Revenue came in at $1.32 billion for the period, above analysts’ consensus of $1.3 billion.

Marvel shares are trading at levels not seen since April 2022.

In an analyst conference call, Marvel CEO Matthew Murphy said the company is re-evaluating how it sees AI’s “fantastic” business potential.

“In the past, we considered AI to be one of many applications in the cloud, but the importance, and therefore the opportunity, has increased exponentially,” Murphy said.

Citi analysts said in a note to investors that the company has a significant opportunity to grow its AI-based revenue. Citi raised its price target to $61 from $58 and maintained its buy rating.

“By 2023, MRVL estimates its AI revenue to be ~$200M, a significant increase over FY22. The company expects AI sales to reach ~$400M+ before doubling in FY25,” Citi’s Atif Malik said in a note.

Many semiconductor companies experienced a lift from Nvidia’s Wednesday blowout earnings report. Nvidia’s market capitalization now sits at around $1 trillion.

CNBC’s Michael Blue and Chris Hayes contributed to this report.

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