MaxLinear Q1 2025 Earnings Report

MaxLinear EPS Results

• Actual EPS: -$0.05
• Consensus EPS: -$0.05
• Beat/Miss: Met Expectations
• One Year Ago EPS: -$0.21

MaxLinear Revenue Results

• Actual Revenue: $95.93 million
• Expected Revenue: $95.32 million
• Beat/Miss: Beat by +$615.00 thousand
• YoY Revenue Growth: +0.70%

MaxLinear Announcement Details

• Quarter: Q1 2025
• Date: 4/23/2025
• Time: After Market Closes
• Conference Call Date: Wednesday, April 23, 2025
• Conference Call Time: 4:30PM ET

MaxLinear (NASDAQ:MXL) provides communications systems-on-chip solutions worldwide. Its products integrate various portions of a high-speed communication system, including radio frequency, high-performance analog, mixed-signal, digital signal processing, security engines, data compression and networking layers, and power management. The company's products are used in various electronic devices, such as radio transceivers and modems for 4G/5G base-station and backhaul infrastructure; optical transceivers targeting hyperscale data centers; Wi-Fi and wireline routers for home networking; broadband modems compliant with data over cable service interface specifications, passive optical fiber standards, and digital subscriber line, as well as power management and interface products. It serves electronics distributors, module makers, original equipment manufacturers, and original design manufacturers through a direct sales force, third-party sales representatives, and a network of distributors. The company was incorporated in 2003 and is headquartered in Carlsbad, California.

MaxLinear Q1 2025 Earnings Call Transcript

Key Takeaways

• Exceeded Q1 guidance with $95.9 M in revenue, 59.1% non-GAAP gross margin, reduced operating expenses, and expects non-GAAP profitability and positive free cash flow in Q2.
• Drove multiple design wins for 5 nm Keystone PAM4 DSPs and showcased Keystone-powered modules plus Rushmore 1.6 Tb PAM4 demos, targeting 800 Gb and 1.6 Tb data center rollouts in 2025 for strong 2026 growth.
• Demonstrated the Sierra open RAN macro SoC at Mobile World Congress, highlighting interoperability and digital predistortion tech, and anticipates content gains as service provider capex rebounds later this year.
• Confident in broadband and connectivity market recovery with ramp of single-chip fiber PON and Tri-Band Wi-Fi 7 gateway SoCs for a second Tier 1 North American carrier later this year and expects fiber revenues to accelerate in 2026.
• Guided Q2 revenue of $95 M–$115 M, GAAP gross margin of 54.5%–57.5%, non-GAAP gross margin of 57.5%–60.5%, and projects continued growth alongside a return to sustained profitability and cash generation.

Presentation

[Operator]

Greetings, and welcome to the MaxLinear First Quarter twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce Leslie Green of Investor Relations.

[Operator]

Please go ahead.

[Leslie Green, Investor Relations at MaxLinear]

Thank you, Joe. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss MaxLinear's first quarter twenty twenty five financial results. Today's call is being hosted by Doctor. Kishore Sundripu, CEO and Steve Litchfield, Chief Financial Officer and Chief Corporate Strategy Officer. After our prepared comments, we will take your questions.

[Leslie Green, Investor Relations at MaxLinear]

Our comments today include forward looking statements within the meaning of applicable securities laws, including statements relating to our guidance for the second quarter of twenty twenty five, including revenue, GAAP and non GAAP gross margin, GAAP and non GAAP operating expenses, GAAP and non GAAP interest and other expense, GAAP and non GAAP income tax and GAAP and non GAAP diluted share count. In addition, we will make forward looking statements relating to trends, opportunities, execution of our business plan and potential growth and uncertainties in various product and geographic markets, including without limitation, statements concerning the future financial and operating results, opportunities for revenue and market share across our target markets, new products, including the timing of production and launches of such products, demand for and adoption of certain technologies and our total addressable market. These forward looking statements involve substantial risks and uncertainties, including risks outlined in our Risk Factors section of our recent SEC filings, including our Form 10 Q for the quarter ended 03/31/2025, which we filed today. Any forward looking statements are made as of today, and MaxLinear has no obligation to update or revise any forward looking statements. The first quarter twenty twenty five earnings release is available in the Investor Relations section of our website at maxlinear.com.

[Leslie Green, Investor Relations at MaxLinear]

In addition, we will report certain historical financial metrics, including but not limited to gross margin, operating margin, operating expense and interest and other expense on both a GAAP and non GAAP basis. We encourage investors to review the detailed reconciliation of our GAAP to non GAAP presentations and the press release available on our website. We do not provide a reconciliation of non GAAP guidance for future periods because of the inherent uncertainty associated with our ability to project certain future changes, including stock based compensation and its related tax effects as well as potential impairments. Non GAAP financial measures discussed today are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures. We are providing this information because management believes it is useful to investors as it reflects how management measures our business.

[Leslie Green, Investor Relations at MaxLinear]

Lastly, this call is also being webcast and a replay will be available on our website for two weeks. And now let me turn the call over to Doctor. Kishore Sindrivu, CEO of MaxLinear. Kishore?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Thank you, Leslie, and good afternoon, everyone. Our Q1 results reflect the continued growth and recovery of our business. We exceeded the midpoint of our guidance with $95,900,000 in revenue, non GAAP gross margin of 59.1% and a meaningful reduction in operating expenses. We not only expect to be profitable on a non GAAP basis in Q2, but also most importantly to be able to generate positive free cash flow in Q2. In total, in Q1, we made strong progress towards our return to profitability and are solidly executing with new product wins in high speed data center interconnects, on WiFi and Ethernet.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We are also seeing meaningful improvement in our customer order rates and backlog, which give us confidence that we can continue to deliver growth in 2025 and 2026. Now looking at our key markets. In infrastructure, the increasing demand for high speed data is driving significant growth and design activity around high speed interconnects in data centers, cloud infrastructure and next generation telecom networks. We continue to make strong progress with product calls across multiple customers for our five nanometer Keystone PAM4 DSP product. At the Optical Fiber Conference, we demonstrated nearly a dozen Keystone powered optical and active electrical cable modules for OSFP switches.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We also highlighted a reverse gearbox application using Keystone from one of the world's leading module makers, as well as a half retimed active electrical cable wide cable solution also using Keystone. Our products were featured in demos at the booths of several partners, which are in various forms of production or qualification stages. We were also pleased to showcase the live demo of our Rushmore 1.6 terabit, 200 gigabit per lane PAM4 DSP. Like Keystone, our Rushmore family of PAM4 TIAs and DSPs with 1.6 terabit interconnections offers superior power and performance advantages. This continues the basis of our competitive differentiation and design win success.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We anticipate additional qualification and rollout for 800 gigabit and 1.6 gigabit data center applications throughout 2025 with exciting revenue growth in 2026. With wireless infrastructure at the Mobile World Congress, we demonstrated a highly integrated Sierra radio system on chip as a complete open RAN macro radiate unit solution, It's seamlessly inter operated with all major GaN power amplifier suppliers, utilizing MaxLinear's proprietary digital breed distortion technology. Our wireless five gs access single chip radio SoCs and our millimeter wave and microwave back haul transceivers and modems are essential for supporting increasing mobile usage and data rates as well as new functionalities such as edge AI. We believe we are positioned strongly for content growth and share gains this year as service provider capital expenses improves and as our continued design wins at Tier one customers begin to ramp later this year. Also within our infrastructure revenues, our Panther family of hardware storage accelerator SoCs is strongly positioned within the data center enterprise storage applications and the edge of the network with multiple design wins with major customers and value added resellers across key geographies.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

It enables optimized cost, power, performance and efficiency of storage and compute server systems by offloading complex tasks that otherwise require long and costly CPU cycles to execute in software. It provides unique and best in class capabilities around data compression, integrity and security with support for 200 gigabits per second throughput and the lowest latencies essential for AI applications. Shifting to broadband and Wi Fi connectivity, in the near term, we feel increasingly confident in the ongoing recovery of the broadband and connectivity markets. Now with several quarters of improvement behind us, we're excited to begin the ramp of our single chip integrated fiber PON and 10 gigabit processor gateway SoC plus Tri Band Wi Fi seven single chip platform solution with the second major Tier one North American carrier later this year. This is both a major significant validation of our technology and competitive positioning in the fiber PON market.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We expect that it will drive meaningful growth for our fiber revenues in 2026 and give us a strong foothold to continue to expand our presence in PON. Overall, bookings have continued to strengthen and we are seeing incremental growth in demand for our Cable Data DOCSIS products as well as our WiFi and Ethernet solutions. With a broad portfolio of newly refreshed products ramping into this market and a healthier demand environment, we expect continued growth in these categories throughout the balance of the year. In conclusion, we view Q2 and 2025 as a year of strong growth and return to profitability transition as we begin to drive growth in strategic areas of our product portfolio and enjoy the incremental tailwind of the ongoing recovery in our core markets. Investments made in high value categories such as high speed interconnect for the data center, multi gigabit PON access, Wi Fi connectivity, Ethernet, storage accelerators and wireless infrastructure are resulting in strong product traction with Tier one customers and partners.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We believe this positions us well to accelerate our growth as these markets continue to gain traction in 2026. With that, let me turn the call over to Steve Litchfield, our Chief Financial Officer and Chief Corporate Strategy Officer. Steve? Thank you, Kishore.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Total revenue for the first quarter was $95,900,000 up from $92,200,000 in the previous quarter. Infrastructure revenue for the first quarter was approximately 27,000,000 Broadband revenue was approximately $41,000,000 Connectivity revenue was $20,000,000 and our industrial multimarket revenue was $8,000,000 GAAP and non GAAP gross margin for the first first quarter were approximately 56.159.1% of revenue. The delta between GAAP and non GAAP gross margin in the first quarter was primarily driven by $2,600,000 of acquisition related intangible asset amortization. First quarter GAAP operating expenses were $99,900,000 and non GAAP operating expenses were $58,400,000 The delta between GAAP and non GAAP operating expenses was primarily due to stock based compensation and performance based equity accruals of $28,900,000 combined, restructuring cost of $7,900,000 and acquisition related cost of $3,200,000 GAAP and non GAAP loss from operations for Q1 twenty twenty five was 482% of net revenue. GAAP and non GAAP interest and other expense during the quarter was $2,900,000 and $2,700,000 respectively.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

In Q1, cash flow used in operating activities was approximately 11,400,000 We exited Q1 of twenty twenty five ahead of plan with approximately $104,000,000 in cash, cash equivalents and restricted cash. With the overall improvement of our business, we expect that in Q2, we will have positive operating cash flow and thus begin to generate cash again. Our day sales outstanding was approximately ninety four days in Q1. Our gross inventory was down versus the previous quarter by approximately $4,300,000 as we continue to make improvements with inventory turns at 1.3. This concludes the discussion of our Q1 financial results.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Before providing our guidance for Q2, I'd like to comment on the tariff situation and the geopolitical dynamics around semiconductors. As you are all aware, the market has a tremendous amount of uncertainty with regards to the trade environment. We are working closely with customers to address the changing landscape and have taken the current environment into consideration with our guidance. It's important to acknowledge, though, that the guidelines are still evolving, so it's difficult to know exactly how the demand drivers will play out for the quarter and for the rest of the year. With that, let's turn to our guidance.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

For Q2 of twenty twenty five, we currently expect revenue in the second quarter of twenty twenty five to be between $95,000,000 and 115,000,000 Looking at Q2 by end market, we expect all end markets, infrastructure, broadband, connectivity and industrial multimarket, to be up in the quarter. We expect second quarter GAAP gross margin to be approximately 54.5 to 57.5% and non GAAP gross margin to be in the range of 57.560.5% of revenue. We expect Q2 twenty twenty five GAAP operating expenses to be in the range of $92,000,000 to $98,000,000 We expect Q2 twenty twenty five non GAAP operating expenses to be in the range of $55,000,000 to $61,000,000 We expect our Q2 GAAP and non GAAP interest and other expense each to be in the range of 2,000,000 to 3,000,000 We expect a $2,400,000 tax expense on a GAAP basis and non GAAP tax rate of 10.5%. We expect our Q2 GAAP and non GAAP diluted share count to be approximately 87,000,000 to $87,500,000 In closing, another quarter of improvement in customer orders and continued new product traction gives us confidence that we will continue to see growth and recovery in 2025 and beyond. We're excited that our innovation and our investment in strategic applications such as optical high speed interconnects, wireless infrastructure storage, Ethernet, Wi Fi and fiber PON gateways are beginning to deliver new and transformative business opportunities.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Our continued growth coupled with our strong focus on operational efficiency is positioning us for a sustainable return to profitability and cash generation this quarter. With that, I'd like to open up the call for questions.

[Operator]

Thank you. And our first question comes from the line of Christopher Rolland with Susquehanna International Group. Please proceed.

[Christopher Rolland, Senior Equity Analyst at SIG Group]

Hey, guys. Thank you so much for the question. And I guess, just as we all care about tariffs right now, I'll ask on the supply chain, and I understand the uncertainty. But if you could perhaps walk us through some of the risks that you see in your own, but also your customers' supply chain. Like, for example, I believe a lot of like broadband equipment is manufactured in China.

[Christopher Rolland, Senior Equity Analyst at SIG Group]

How transferable would this be to other geographies? Just generally, if you could give us a sense of these risks, how these risks could be mitigated, and if there's anything that kind of keeps you guys up at night? Yes,

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Chris, thanks for the question, and there's plenty keeping us up at night right now. So just maybe to start with, look, we don't have a lot of real direct impact, right? Mean, semiconductors are not included here, so we're not seeing direct tariffs. So our supply chain actually is pretty good. So we feel pretty good about that.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Second part of your question kind of alluded to the customers. I think where we're just watching closely is what's customer demand look like? Does that how do the tariffs kind of get transferred to the consumer? Ultimately, does that slow demand? So we're watching that.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

I guess in between all of that, watching the ODMs and OEMs and how they're navigating this environment, you mentioned that China is a bigger kind of box manufacturing broadband. That's a whole lot less true today than it was five years ago. Five years ago, we saw some impacts here. Most of those customers have moved out of China. So we actually see less of a risk around that.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

But as you know, there's tariffs that are being proposed on all the countries. I think the one that everyone seems to be circling around is China having the biggest impact, and so that's the one that we're watching closely. It seems like a lot of the other ones hopefully will be reduced a little bit and have less of an impact, at least on our ecosystem anyway.

[Christopher Rolland, Senior Equity Analyst at SIG Group]

Thank

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

you, I would that none of our broadband CPE customers make any boxes boxes in China for our customers. So I can say that not almost, it's all of them. So we are safe from a China manufacturing perspective. We don't have any exposure there. But more importantly, I think our bookings have been pretty strong even let's say, so we look at it in two buckets, the craziness that may come later versus what was let's say two weeks ago and our bookings have been very strong.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We have been taking bookings even into Q3, Q4. So we are seeing a nice recovery. It's now been going on for several quarters on our broadband business. So I would put it in two categories in terms of what is the true demand versus what is the supply chain driven, the yanking, whether it's in a accelerated demand versus maybe a delayed demand, we see both sides of it. So but from our perspective, with our lead times for manufacturing being anywhere between sixteen to twenty weeks, any gyrations that come from the ninety day tariff pause is not going to have any effect on our ability to supply chips in an accelerated manner or a decelerated manner.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

That's we are well past that.

[Christopher Rolland, Senior Equity Analyst at SIG Group]

Great. Thank you guys. And I also just as you brought up bookings, Keyshaure, I was just wondering, it was great that you think everything is going to be up next quarter, but if you look at bookings, if you look at that order book, if you take a guess and maybe you can fill us in, in those inventory situations per end market, could you force rank those segments for us into the next quarter by strength?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Okay. I think in general, our problem is very different from the ones who have been enjoying the demand in the data center for some time now, right? We are recovering from what was a 2022 peak consumption of a product, specifically broadband and telecom markets. So that depletion is almost fully set in now and that's why we are seeing where we think the channel inventories are lower than they should be. So we have been seeing strong bookings from Q4 onwards even in Q3 last year.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

And we are actually now taking bookings for Q3, Q4. So I believe that the channel inventory issues that may develop because of for some of the customers are not necessarily particular to the issues we faced in the previous two years. So we are pretty much right now in a filling pattern rather than waiting to deplete pattern.

[Christopher Rolland, Senior Equity Analyst at SIG Group]

Okay. Did you see any strength, one segment versus the other for

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

the next quarter? Actually, are seeing generally a broad based strengthening of demand, except we are seeing some weakness in our industrial markets that is in China that has got China exposure from an end demand perspective, but otherwise we are feeling pretty positive that we will continue to grow strongly for the rest of the year and beyond.

[Christopher Rolland, Senior Equity Analyst at SIG Group]

Great. Thank you so much for the update guys. Appreciate

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Yes. Thanks Chris.

[Operator]

And the next question comes from the line of David Williams with The Benchmark Company. Please proceed.

[David Williams, Equity Research Analyst at The Benchmark Company LLC]

Hey, good afternoon. Thanks for taking my questions and congrats on the stabilization and the positive outlook here. So my first question is maybe Kishore you pointed to the design win progress on the DSP side for Keystone and that continued through the quarter. Can you help us try to understand the magnitude of maybe that progress and where you are in terms of the design wins and maybe that ramp as you think about the next maybe six to twelve months?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So David, thank you. We're feeling very positive finally, right. When you reach there is only when then you can sort of exhale. So we're very happy that we are expecting to breakeven in Q2 and turn cash flow positive as well. It's a major milestone given what's happened in the last few quarters, right.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So that's the good news. And we think that the rest of the year we will keep generating positive cash flow. So moving to the data center, the Optical Fiber Conference, we just displayed about 20 designs on display that are done in our booth and there are partners who are showing that they were all actually Keystone based. And we had four demonstrations of evaluation platforms for our Rushmore design. So if you look at those 20 designs, that's one way to look at all those 20 designs that are in various stages of qualification.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

And I think Steve has already guided in the last earnings call that we would land somewhere between 50,000,000 to $80,000,000 I think specifically said 60,000,000 to $70,000,000 which will be a doubling of last year's revenue. So, would say given how long it takes to qualify in this market, and because it's a pretty highly demanding market, it's a pretty complex product, even though you call it the OSFP. So the fact that we can double our revenue is proof that the quality of our designs and the caliber of our customers is quite different from last year. Otherwise, you won't be able to double your revenue. So we feel very good.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

And that leads to my own sort of musings, what does next year look like? Obviously, we hope that if the call is all good in a nice way, can be doubled from here in 2026. But that will require some key calls to complete and they're all slated for the second half of this year. And we expect all the revenue next year actually coming from Keystone for a while. Okay.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

I hope that's helpful.

[David Williams, Equity Research Analyst at The Benchmark Company LLC]

Fantastic color. Thanks so much there. And then maybe just secondly on the North American that second Tier one. It sounds like you're expecting that kind of ramp at the back end of the year and then more fully next year. Can you kind of talk maybe size the magnitude of that and how we should think about that ramp going forward?

[David Williams, Equity Research Analyst at The Benchmark Company LLC]

Thanks.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So I think you're talking about broadband PON Tier one operator in North America. Yes, I mean, we're pretty excited. We were the first ones to be selected for the new category of high end boxes against what you all know is a pretty vicious competition, right. And so it will be a nice anchor that adds to our other Tier one operator in North America for the gateway design, but this clearly is a bigger player. So we're very excited about it.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

And I think one of these guys ramp will be shipped a few quantities. They have this year towards the end of the year for sure, of course, but next year would be the ramp and hopefully we're the first ones to ramp before the second supplier comes online. And we seem to have a good lead on that. So we should enjoy significant growth. So if you think of our pawn revenue today as I'm in the 50,000,000 range, next year can you double overall?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Absolutely, that's the goal here.

[David Williams, Equity Research Analyst at The Benchmark Company LLC]

Thanks so much.

[Operator]

And the next question comes from the line of Jeremy Kwan with Stifel. Please proceed.

[Jeremy Kwan, Associate Vice President - Equity Research at Stifel Financial Corp]

Yes, good afternoon and let me add my congratulations on the recovery here. I guess maybe asking the end market question just on a longer term basis. It looks like you're seeing some nice recovery in broadband and connectivity. Infrastructure. It looks like it's going to be a nice growth driver.

[Jeremy Kwan, Associate Vice President - Equity Research at Stifel Financial Corp]

Would you can you rank order those for us maybe as we look out to calendar twenty six in terms of growth contribution?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So let me maybe Steve can answer those sort of quantitative question a little bit better than I can, but I would just say that infrastructure has clearly been the focus of massive investment for us, strategically important because I look at infrastructure is a very, very core American market, right. If you really look at it, there are two markets that are the biggest ones. One is the enterprise infrastructure market, which is now primarily the cloud market. The other one is a consumer market and we are not a consumer products company. So for us being in the infrastructure market is a strategic imperative and it drives a lot of differentiation and gross margin improvement for the company.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So I would think that the infrastructure would be the most exciting growth on a new product cycle basis, right. What you will see in broadband is some level of pretty rapid recovery. I'm talking of I'm not going to comment on tariffs here, right? I'll just leave that aside. If you just look at it in a secular term, there'll be a strong growth driven by recovery in the core market and a pretty decent team sort of growth from new product cycles.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

I think that's a pretty healthy product. And then, you add to that what's happening in the new product like PON we talked about, I gave the size of it. These are pretty cable also we should start seeing some outside of PON in the cable docs as data market. So, networks are still being upgraded. There's a lot of demand for increasing their competitive position against PON.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

And I think for us, broadband actually is kind of exciting, though data center and infrastructure are kind of a strategic imperative. On wireless, lot of good things are happening. Actually, we'll have very strong growth in 2026 on the back of our Sierra product, access market, we will start pivoting towards being maybe one of the top silicon providers as a merchant silicon providers. So, yes, I would say infrastructure broadband would be the new product cycle growth and then you have we'll have some other new product cycle growth, but it won't be as exciting in the industrial markets because the market is up and down in some areas. So those two would be our rank pretty high.

[Jeremy Kwan, Associate Vice President - Equity Research at Stifel Financial Corp]

Great. Thank you. And I guess just maybe digging a little deeper into the storage accelerating market. It sounds like that's finally close to Can you give us an idea maybe what are some of the key applications? Any sense of how many customers you can talk about just quantity wise?

[Jeremy Kwan, Associate Vice President - Equity Research at Stifel Financial Corp]

And is this more enterprise? Or is it more data center? Any color you can provide would be very helpful.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So at the end of the day, even if it's enterprise, I just want to make sure that they're selling these boxes to the storage appliance server or compute server boxes. They're all ending up in some form of AI edge data center or in the data center. Having said that, we have 20 odd proof of concepts going on, right. And the revenue we talk about, somewhere between 10,000,000 to $20,000,000 in 2025 is, is driven by enterprise storage today and royalty software license revenues as well, because we also have a sort of a paired offering on the store using our superior algorithms for better compression storage in the traditional systems. And then we have these compute servers that are being actually are being demonstrated, right?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We had the Atlanta Supercompute Conference where we demonstrated with QCT, which is a major compute server manufacturer. There they use storage compression. But the key point is why do they need it? It's not just about compression and security for reducing the amount of storage space. It actually wraps a very, very powerful enabling capability where we reduce the latency of compute by really having a very, very low latency storage with very, very high density compression.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So, what that does is when you think about AI type applications, whether it is inside the data center or outside the data center, it becomes very critical not to have bottlenecks in the a training or inference systems. So, I think at this point, to be honest with you, our revenues are coming from enterprise, which is basically storage appliances and compute servers. However, have a lot of strong traction after our reference platform announcement with AMD, a joint development platform, but we're a lot of traction in the other non enterprise markets as well. I think if you just fast forward this year 10,000,000 to $20,000,000 can it double or triple next year? Absolutely.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Because once you're qualified, just takes off. And then the fall is so I had told a year ago that in two to three years, we should see based on enterprise storage alone somewhere peaking out at maybe $75,000,000 revenue, I said 50,000,000 to $75,000,000 I think, yes, it's delayed a little bit, but nothing beyond what we had forecast. I think we should be able to hit that benchmark purely off enterprise storage. Now, if we were to get one or two calls on the compute side, I think this can easily be a 2x on that in a five to seven year window. So very, very nice differentiated product that nobody else having such an offering in the world.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Okay.

[Jeremy Kwan, Associate Vice President - Equity Research at Stifel Financial Corp]

Perfect. Thank you very much.

[Operator]

And the next question comes from the line of Quinn Bolton with Needham and Company. Please proceed.

[Quinn Bolton, Senior Analyst at Needham & Company]

Hey, guys. Wanted to come back just a couple of

[Quinn Bolton, Senior Analyst at Needham & Company]

clarifications on tariffs. One, you mentioned none of the CPE boxes manufactured in China, but my guess is there are probably a number of them manufactured elsewhere in Southeast Asia where there are reciprocal tariffs. I know there's been paused for ninety days, but to the extent that those aren't totally taken away, would you expect some greater tariff effect possibly in the second half of the year? And then the second clarification is you guys manufacture everything overseas, right? So there's no reciprocal tariffs for any semiconductor chips you ship into China, whether it's consumed in China, whether it's re exported, right?

[Quinn Bolton, Senior Analyst at Needham & Company]

So no tariff costs on your products to the extent that they flow through China?

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

That's correct, Glenn. With regard to the first part of your question, yes, I mean, all of the other Southeast Asia countries where a lot of these boxes are manufactured are at least currently planned to be subject to these tariffs, right? And I think this is the part that there's plenty of uncertainty in trying to figure out how things move around, right, and what the ODMs and OEMs kind of decide to do on this front. And we don't have 100% clarity. It's all pretty new right now.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

And so this is where I mentioned kind of working with the customers, trying to help them get those boxes kind of through the whole tariff malaise, if you will. And that's what we're doing right now.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Look, all our if you really step back a little bit, the broadband CPEs have been sort of tired offerings for the last two, three years because of excess inventory in the system. But now they transition to new generation boxes, whether it's 10 gigabit PON and so on and so forth. So my surmise is that these are needed to be competitive offerings and that's where the applications are going on. And I think while I cannot I'm not a macro economist, but I think that the demand is the demand and that the prices will be adjusted within the supply chains here. And but I don't think the demand goes away, because I think broadband is a very inelastic market, what makes it boring and what exciting from it depends on which viewpoint you take.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

And so I feel very comfortable that we will be able to continue to grow in broadband.

[Quinn Bolton, Senior Analyst at Needham & Company]

Got it. And then maybe just given all of this uncertainty, can you give us a sense like how you approached guidance in this light? Is the $105,000,000 midpoint, did you kind of say, hey, we're going to take our forecast, judge it down and you came up with $105,000,000 at the midpoint or is 105,000,000 kind of where you think things fall and then you just broadened out the range given the uncertainty. Just any sort of sense how you might have accounted for this tariff uncertainty in the guidance? And then I do have one business question if I could squeeze in a third.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Yes, Glenn. Look, I don't think I covered this in the prepared remarks. Yes, we've done our best to anticipate the tariffs that we have in front of us, and that's what we base our guidance on. What was your other question?

[Quinn Bolton, Senior Analyst at Needham & Company]

The other question is just, I think last quarter, you talked about some variability in the optical DSP ramp depending on the timing of hyperscaler 800 gig ramps in the second half of twenty twenty five. Wondering as you sit here today, how you're feeling about timing of those 800 gig ramps? Are you feeling better that those hit in 2025? Is there still some uncertainty on when those 800 gig deployments at the hyperscalers start to kick in?

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

So I think Yashur covered this in his question. I mean, we've had a guidance of 60,000,000 to $70,000,000 I think we stand by that. We're comfortable with that. As you're well aware, I mean, of those 800 gig ramps are in the second half of the year. So that's also consistent with the way we've talked about them.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

And I think we're completely comfortable with that. Okay, great. Thank you. Good. Thank you.

[Operator]

And the next question comes from the line of Ananda Baruah with Loop Capital Markets. Please proceed.

[Ananda Baruah, Research Analyst at Loop Capital]

Hey guys, good afternoon. Thanks for taking the question. Really appreciate it. Yes, yes, good to talk to you guys. I guess Keeshaar and Steve, you may this may be implied in all the comments you guys have already made about demand environment.

[Ananda Baruah, Research Analyst at Loop Capital]

But let me also just ask it this way to make sure I cover the basis here. So it sounds like Kishore, no macro no signs of macro impact yet in your order book? And let me also ask, do you think you're seeing any pull forward revenue? It doesn't sound like it, but let me ask that question as well. Thanks.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

I was wondering when that question was going to come of the pull forward. It looks like COVID,

[Ananda Baruah, Research Analyst at Loop Capital]

Here we

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

No, not really. Okay. We are pretty early in our earnings call in that ninety day window pause announcement a few days ago, right? So the reaction time is it will take a little longer. So if as in bookings spike up, let's say this week or next week, some people have talked about it.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

We talked to colleagues in the industry. We will take them with more than a grain of salt, let's put it that way, and we will try to be measured about it. But I want to repeat again that our lead time per chips is about sixteen to twenty weeks. There is nothing you can do in the ninety days that's going to change our ability to ship product. So, we will not be able to mobilize even if they were to spike orders on us.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So, that's the reality.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

And Ananda, I'll just maybe echo I'll just echo the overall demand. Mean, because, yes, the world's kind of been turned upside down in the last two weeks, but I really want to echo the last quarter or two or three quarters for that matter, we've continued to see improvements, right? That's the recovery that we both talked about a little bit earlier in the prepared remarks. That backlog has continued to improve. The bookings have continued to improve for about six quarters now.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

And so a lot of encouraging signs on the new products as well as existing products.

[Ananda Baruah, Research Analyst at Loop Capital]

That's super helpful. And I guess just my quick follow-up on the demand side is, Tishore, your comments about data center, it makes it sounds like this all applies to data center as well and that data centers are I'm paraphrasing here. You say full speed ahead, and maybe I'm making that up. But I thought there was some comment about data center energy spend and AWS and Google have come out in the last couple of weeks and reaffirmed spending plans. Vertiv this morning was like super bullish, not just for hyperscaler, but for Neo Clouds and Colos.

[Ananda Baruah, Research Analyst at Loop Capital]

So I just want to just sort of clarify that as well. It sounds like you're seeing no change in activity in the data center space either. Is that accurate? For

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

us, it's still about digging, right, knitting the products together, so to speak, right, qualifying and that sort of work, right. So we don't have the levels of incumbency that where the dialogue is very different. So, I think at this point, no change for us how we have to go about our actions. So, I really cannot comment on what a large incumbent exposures mean to this situation.

[Ananda Baruah, Research Analyst at Loop Capital]

I got it. That's helpful. I appreciate it. Thanks guys.

[Steve Litchfield, CFO and Chief Corporate Strategy Officer at MaxLinear]

Yes. Thanks Ananda.

[Operator]

And the next question comes from the line of Richard Shannon with Craig Hallum. Please proceed.

[Richard Shannon, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Thanks, guys, for taking my questions. Maybe I'll ask one on the wireless infrastructure side. Kishore, I think you've mentioned this briefly here. We'd love to get a sense of your confidence of the ramp up here later this year. Maybe you can talk to the extent to which you see the revenue growth coming more from the content side or also from the unit side as well.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Absolutely. If you look at it, up until now, our revenues were primarily consisted of two parts to our wireless infrastructure, right? One is millimeter wave of microwave backhaul transceivers and modems. And last year and this year sort of suddenly not last year, this year, the revenues came really, really down because the telco stopped spending because but however, we are now seeing bookings picking up very nicely, strengthening, and we hope to double from what we did last year on that product line alone. But in addition, the access, we have a Sierra product where the content in the platform is going to increase quite a bit.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

It's a single chip macro radio unit. There is a very good customer design win traction in Mobile World Congress. We had so much sort of presence and traction in terms of all the things we were showcasing. So we expect that to be a strong driver next year as it starts picking up this year. So, and that's a brand new platform where it's a single, we own the platform just like in the microwave and microwave vacuum.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So we expect revenues to access to continue to grow for the next five to six years. On the backhaul side, there's lot of strong demand now for E band. That means that these AI edge applications are driving more and more data requirements. And so we're seeing demand for millimeter wave products, which did not exist in the previous revenues. So we are actually seeing strong growth in the millimeter wave transceivers and back wall modems.

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

So those two would be the big drivers of growth. On top of that, we expect a recovery of the normal core business as well. So, so that will be the layering of it. So, you will see a strong revenue growth coming from just recovery, and then product cycles, secular growth over the next few years by content growth, both millimeter wave, microwave modems and transceivers, and also the brand new category of single chip macro platform, Sierra type product for the base stations.

[Richard Shannon, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Okay. And Keshar, if I could just confirm one of your comments here, I think you said doubling from last year alone. Don't know if that was a comment across the whole wireless exposure or something specific. Can you clarify that, please?

[Kishore Seendripu, Co-Founder, Chairman, CEO & President at MaxLinear]

Yes. It's across the whole wireless exposure.

[Richard Shannon, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Got it. Okay, perfect. My follow on question is related to optical DSP here. I guess I wanted to get a sense of when and how do you expect to get and look for higher allocations of share with your Keystone platform and or to what degree do you see that success there happening and also being applied to Rushmore

[Operator]

as

Participants

Executives

• Leslie Green, Investor Relations
• Kishore Seendripu, Co-Founder, Chairman, CEO & President
• Steve Litchfield, CFO and Chief Corporate Strategy Officer

Analysts

• Christopher Rolland, Senior Equity Analyst at SIG Group
• David Williams, Equity Research Analyst at The Benchmark Company LLC
• Jeremy Kwan, Associate Vice President - Equity Research at Stifel Financial Corp
• Quinn Bolton, Senior Analyst at Needham & Company
• Ananda Baruah, Research Analyst at Loop Capital
• Richard Shannon, Senior Research Analyst at Craig-Hallum Capital Group LLC