Marvell Technology's Shellacking Continues

The warning marks the second consecutive revenue shortfall for a company that has wowed investors with solid growth over the past several years. In August, Marvell posted second-quarter sales that came in below expectations.

And the $580 million third-quarter revenue guidance that Marvell served up at the time was significantly below analysts' third-quarter projections of $622.5 million.

The company did not report profit figures at the time because of its ongoing internal review of its historical stock-option practices. Marvell is among more than 100 companies under scrutiny for a widening controversy involving the backdating of stock options.

Marvell said it expects a significant increase in general and administrative expenses in its third quarter due to higher-than-expected costs incurred from the ongoing stock-option review.

In a separate release after the bell Monday, Marvell said that the special committee of its board of directors looking into past stock-option practices has reached a preliminary conclusion that the actual measurement dates of certain past stock-option grants likely differ from the recorded grant dates for such awards.

As a result, Marvell's board has concluded that the company will need to restate previous financial statements to record additional noncash charges for stock-based compensation expenses.

Marvell said it has not yet determined the amount of these charges or which specific reporting periods they affect. But the company said that investors should no longer rely on any financial statements issued since the company went public in 2000.

The chipmaker said it intends to file its restated financial statements as soon as possible after the completion of the stock-option review.

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