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Chipmaker Marvell Technology (NASDAQ:MRVL) reported fiscal third-quarter earnings last night, and investors clearly like what they see. Shares have jumped 10% today to tap fresh highs for 2016, and Marvell is now up nearly 70% for the year. 

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It's worth noting here that Marvel lost 40% of its value in 2015, so this year's performance is mostly making up for last year.

The headliners

Revenue in the third quarter came in at $654 million, ahead of both the company's guidance as well as the consensus estimate of $616 million. Adjusted gross margin expanded to a strong 56.7%, a meaningful improvement from the 45.8% adjusted gross margin in the year-ago quarter. Non-GAAP earnings per share was $0.14, also topping analysts' forecasts of $0.12 per share in adjusted profit.

CEO Matt Murphy attributed the performance to the company's data storage and network infrastructure segments, both of which grew by double digits. Earlier this month, Marvell announced a restructuring plan intended to improve growth and profitability. As part of this process, the company has been reviewing where to best allocate its R&D efforts, and is focusing on these two markets as well as wireless connectivity. Murphy said that these are where Marvell's core strengths lie, and the company will invest accordingly.

Marvell expects the restructuring plan to be fully implemented over the next year, and it should translate into a meaningful reduction in annual operating expenses. The company currently spends about $1.1 billion per year in operating expenses, and the restructuring should bring that figure down to around $820 million to $840 million. There will be about $90 million to $110 million in restructuring charges over the next four quarters, of which only about $35 million to $50 million will be cash charges.

Guidance and buyback

Looking forward, guidance for the fourth quarter calls for sales of approximately $565 million, give or take 2%. Adjusted gross margin should stay relatively flat at 57% to 58%, and non-GAAP earnings per share is expected to be in the range of $0.17 to $0.21. That forecast is mixed relative to expectations, which were expecting sales of $594 million and an adjusted profit of $0.13 per share. The better-than-expected guidance for the bottom line shows that Marvell expects further progress with cutting costs; non-GAAP operating expenses next quarter should be $225 million to $235 million, excluding restructuring charges.

Marvell also announced a new share repurchase program that includes a $1 billion buyback authorization. This repurchase program will replace an outgoing $3.25 billion buyback program that had roughly $115 million remaining, meaning the new authorization is effectively an incremental increase of $885 million. The company says it expects to buy back $500 million worth of stock over the next year.

So far, Marvell is making a comeback after firing husband-and-wife co-founders Sehat Sutardja and Weili Dai earlier this year amid an accounting scandal and concerns around internal controls. Murphy was named CEO in June, and things are already starting to look up.

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