Marvell Technology Group (MRVL.O) gave a cautious revenue forecast as widespread flooding in Thailand hurts demand for its hard-drive controllers, but upbeat news about expansion in China gave the chipmaker's stock a bump.

Wall Street is still assessing the impact of severe flooding that has hampered production across a country that yields a quarter of the world's hard drives. PC manufacturers including Dell (DELL.O) have warned the shortage of drives could lead to slower production.

Marvell makes chips used in hard drives and said it expects up to 10 percent of the lost hard-drive production to be recovered in the quarter ending in January.

It expects about half to be recovered in the April quarter and the rest later next year, Chief Financial Officer Clyde Hosein told analysts on a conference call.

The Santa Clara, California company said it expects current-quarter revenue to decline to a range of $775 million to $825 million because of the floods. Analysts on average had expected fourth-quarter revenue of $812 million.

We believe the impact to our Q4 revenue outlook on account of the Thailand floods to be in the range of $120 million to $130 million, Hosein said.

Marvell also said sales of its TD chips in the massive Chinese mobile telephone market were growing quickly, with 30 handset models ramping up.

While we expect increased competition from followers in TD smartphones, we expect to maintain our leadership position and grow revenues next year. Chief Executive Sehat Sutardja told analysts.

Marvell reported revenue of $950 million in the quarter ended in October, down 24 percent but edging past expectations for $937 million.

Shares of the company rose 5 percent to $14.45 in after-hours trade, after sliding 6.3 percent in regular trading to close at $13.76 on the Nasdaq.

It was China, but also I think saying the recovery for hard disk drives would be 50 percent by April. I'd think that's better than expected, said Kevin Cassidy, an analyst at Stifel Nicolaus.

The company posted net income of $195 million or 32 cents a share in the quarter, down from $256 million or 38 cents a share a year earlier.

Excluding items, it earned 40 cents a share, barely beating the average of 39 cents expected by analysts, according to Thomson Reuters I/B/E/S.