Marvell Technology Group Ltd. (NASDAQ: MRVL) in the first quarter of FY 18, the revenue had exceeded the midpoint of the company’s guidance and represented 12% year-over-year growth. The core businesses of storage, networking, nd connectivity grew 15% year-over-year and now account for 90% of our total sales. This is the third consecutive quarter in which the core businesses grew year-over-year. The new business model also generated impressive gross margins. In the first quarter, the non-GAAP gross margin rose about 60%, exceeding the 59% forecast.

Marvell Technology’s improvement in gross margin is due to a number of changes the company have made throughout the company. This includes the strong execution on cost reduction initiatives, yield improvements driven by product and test engineering, better discipline in selling the value of the solutions, exiting non-core lower margin businesses, improved mix within the segments and the ramp of new products with higher margins.

In the first quarter, the storage business performed much better than typical seasonality and grew 25% year-over-year. The SSD revenue grew by double digits sequentially and by triple digit year-over-year. This growth reflects the increased market presence in both the SSD client and enterprise and data center markets.

Marvell Technology in the first quarter of FY 18 has reported the adjusted earnings per share of $0.24 compared to $0.03 last year, which is a growth of 700%. The company had reported the adjusted revenue growth of 11.5 percent to $579 million in the first quarter of FY 17, which has exceeded the midpoint of the company’s guidance provided on March 2nd, 2017.

Marvell Technology in the second quarter of FY 18 expects total revenue from continuing operations to be in the range of $585 million to $615 million. At the midpoint of the guidance, MRVL expect the storage revenue to be flat sequentially and to grow double digit year-over-year. The company expects the net working revenue to be approximately flat sequentially. The company continue to see the headwinds from the decline of the legacy product line but do expect the new products ramp to offset the likely decline in the second half of this fiscal year, enabling networking to return to growth. MRVL expect the connectivity revenue to grow more than 30% sequentially and double digit year-over-year, primarily due to a seasonal customer demand in gaining and the growth of the high performance connectivity solutions.

Marvell Technology stock has risen 70.42% in the last one year (as of May 25th, 2017; source: Google Finance).