Q1 2026 MaxLinear Inc Earnings Call

April 23, 2026

Speaker #2: 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 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.

Speaker #2: These forward-looking statements involve risks and uncertainties, including risks outlined in our risk factors section of our recent SEC filings, including our 10-Q for the quarter ended March 31, 2026, which we filed today.

Leslie Green: Thank you, Maria. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss MaxLinear's Q1 2026 financial results. Today's call is being hosted by Dr. Kishore Seendripu, CEO, and Steve Litchfield, Chief Financial Officer and Chief Corporate Strategy Officer. After our prepared comments, we will take questions. Our comments today include forward-looking statements within the meaning of applicable securities laws, including statements relating to our guidance for Q2 2026, 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 taxes, and GAAP and non-GAAP diluted share count.

Speaker #2: 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 2026 earnings release is available in the Investor Relations section of our website at MAXLINEAR.com.

Speaker #2: In addition, we report certain historical financial metrics, including but not limited to gross margin, income or loss from operations, operating expenses, interest and other expense, and income tax on a both gap and non-gap basis.

Leslie Green: 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 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 risks and uncertainties, including risks outlined in our Risk Factors section of our recent SEC filings, including our 10-Q for the quarter ended 31 March 2026, 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 Q1 2026 earnings release is available in the Investor Relations section of our website at maxlinear.com.

Speaker #2: We encourage investors to review the detailed reconciliation of our gap and non-gap presentations, and the press release available on our website. We do not provide a reconciliation of non-gap 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.

Speaker #2: 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.

Speaker #2: Lastly, this call is also being webcast, and the replay will be available on our website for two weeks. And now, let me turn the call over to Dr. Kishore Seendripu, CEO of MaxLinear.

Speaker #2: Kishore?

Speaker #3: Thank you, Leslie, and good afternoon, everyone. Q1 was a strong and important start to the year, and we believe it marks the beginning of a multi-year growth phase for MaxLinear.

Leslie Green: In addition, we report certain historical financial metrics, including, but not limited to, gross margin, income or loss from operations, operating expenses, interest and other expense, and income tax on both GAAP and non-GAAP basis. We encourage investors to review the detailed reconciliation of our GAAP and non-GAAP presentations in 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.

Speaker #3: Led by our optical data center business, revenue grew 43% year over year, reflecting strong execution, accelerating adoption of our newest products, improving visibility and bookings, and sustained momentum across our infrastructure programs.

Speaker #3: Infrastructure is now our largest revenue category, growing 136% year over year in Q1, driven by robust production ramps in optical data center-oriented platforms. We see this momentum continuing to build as hyperscale customers rapidly scale AI-centric architectures.

Speaker #3: Based on customer orders and rising visibility of the program ramps, we are increasing our expectations for 2026 optical data center revenue to the $150 million to $170 million range.

Speaker #3: We also expect a step-function data center revenue increase beginning in Q2, with expected strong upside as run rates expand into 2027. At the center of this data center momentum is our keystone PAM4 DSP optical transceiver platform.

Leslie Green: Lastly, this call is also being webcast, and the replay will be available on our website for two weeks. Now let me turn the call over to Dr. Kishore Seendripu, CEO of MaxLinear. Kishore.

Kishore Seendripu: Thank you, Leslie, and good afternoon, everyone. Q1 was a strong and important start to the year, and we believe it marks the beginning of a multi-year growth phase for MaxLinear, led by our optical data center business. Revenue grew 43% year over year, reflecting strong execution, accelerating adoption of our newest products, improving visibility in bookings, and sustained momentum across our infrastructure programs. Infrastructure is now our largest revenue category, growing 136% year over year in Q1, driven by robust production ramps in optical data center-oriented platforms. We see this momentum continuing to build as hyperscale customers rapidly scale AI-centric architectures. Based on customer orders and rising visibility of the program ramps, we are increasing our expectations for 2026 optical data center revenue to $150 million to $170 million range.

Speaker #3: Keystone is now ramping at multiple major high-skill customers across both the US and Asia, supporting 400G and 1800G PAM4 deployments for scale-up and scale-out applications.

Speaker #3: These ramps validate our differentiation performance, power efficiency, and integration. At OFC this year, we showcased our 1.6-terabit data center platform, featuring PAM4 DSP.

Speaker #3: Washington, our matching 200 gigabit per lane TIA, and Annapurna, which is our 1.6 terabit AEC and 3.2 terabit onboard electrical retimer platform for scale-up applications.

Speaker #3: Rushmore and Annapurna are foundational to the next wave of data center optical architectures, including LPO, LRO, AECs, XPO, and co-packaged optics. With Keystone validating our ability to execute at scale, customer engagement around Rushmore has accelerated faster than expected.

Kishore Seendripu: We also expect a step function data center revenue increase beginning in Q2, with expected strong upside as run rates expand into 2027. At the center of this data center momentum is our Keystone PAM4 DSP optical transceiver platform. Keystone is now ramping at multiple major hyperscale customers across both the US and Asia, supporting 400G and 800G PAM4 deployments for scale-up and scale-out applications. These ramps validate our differentiation in performance, power efficiency, and integration. At OFC this year, we showcased our 1.6 terabit data center platform featuring Rushmore, our 200 gigabit per lane PAM4 DSP, Washington, our matching 200 gigabit per lane TIA, and Annapurna, which is our 1.6 terabit AEC and 3.2 terabit onboard electrical retimer platform for scale-up applications. Rushmore and Annapurna are foundational to the next wave of data center optical architectures, including LPO, LRO, AECs, XPO, and co-packaged optics.

Speaker #3: We anticipate production ramps beginning in late 2026, with revenue growth expected to continue strong growth through 2027 as the next-generation speed and bandwidth cycle unfolds.

Speaker #3: We are also expanding our footprint within hyperscale data centers beyond PAM4-based optical and electrical interconnects. We have secured our first XGS-PON design win at a U.S. hyperscale data center through a tier-one OEM partner, as cloud operators deploy resilient, dedicated PON-based control plane architectures spanning multiple data centers.

Speaker #3: Adjacent to compute, we have also won USB bridge controller designs with two major hyperscalers to support rack-level AI system management, which opens the door to increasing content per rack over time.

Speaker #3: Our Panther hardware storage accelerator SoC family continues to build momentum with growing design win activity among tier one network appliance and cloud service providers.

Speaker #3: Persistent memory constraints are highlighting Panther's advantages in hardware-accelerated compression, high throughput, and ultra-low latency memory access. We're actively sampling next-generation Panther 5 with key customers, and based on current engagement, we expect storage accelerator revenue to at least double in 2026 compared to 2025.

Kishore Seendripu: With Keystone validating our ability to execute at scale, customer engagement around Rushmore has accelerated faster than expected. We anticipate production ramps beginning in late 2026, with revenue growth expected to continue strong growth through 2027 as the next generation speed and bandwidth cycle unfolds. We are also expanding our footprint within hyperscale data centers beyond PAM4-based optical and electrical interconnects. We have secured our first XGS-PON design win at a US hyperscale data center through a tier 1 OEM partner as cloud operators deploy resilient, dedicated PON-based control plane architectures spanning multiple data centers. Adjacent to compute, we have also won USB bridge controller designs with two major hyperscalers to support rack-level AI system management, which opens the door to increasing content per rack over time.

Speaker #3: Beyond data centers, wireless infrastructure momentum is improving as carriers increase investments in 5G RAN access and backhaul to support cloud-connected and edge AI functionality.

Speaker #3: Our Sierra single-chip radio SoCs are now deployed with multiple North American operators, with expanding opportunities as 5G networks continue to evolve. In broadband and connectivity, we're executing large-scale deployments of our single-chip fiber PON and Wi-Fi 7 gateway platforms with a second major tier-one service provider in North America, with additional ramps expected later in the year in Europe.

Speaker #3: These long-cycle deployments provide a stable foundation and leverage the same strengths in integration and power efficiency that clearly differentiate MaxLinear's data center portfolio. In summary, we are very pleased with the strong start to '26 and are especially excited by the momentum accelerating in our optical data center business.

Kishore Seendripu: Our Panther hardware storage accelerator SoC family continues to build momentum with growing design win activity among tier 1 network appliance and cloud service providers. Persistent memory constraints are highlighting Panther's advantages in hardware-accelerated compression, high throughput, and ultra-low latency memory access. We're actively sampling next-generation Panther 5 with key customers, and based on current engagement, we expect storage accelerator revenue to at least double in 2026 compared to 2025. Beyond data centers, wireless infrastructure momentum is improving as carriers increase investments in 5G RAN access and backhaul to support cloud-connected and edge AI functionality. Our Sierra single-chip radio SoCs are now deployed with multiple North American operators, with expanding opportunities as 5G networks continue to evolve.

Speaker #3: With multiple customers entering meaningful ramps of our 800-gigabit Keystone family, and broader engagement across our 1.6-terabit Rushmore and Annapurna product families across scale-out and scale-up AI architectures, we believe MaxLinear is exceptionally well positioned for sustained, transformative growth.

Speaker #3: Our discipline, focus on execution, and innovation give us confidence that 2026 will be a pivotal year as we continue to evolve our strategy and deliver long-term value for our customers and shareholders.

Speaker #3: With that, let me now turn the call over to Steven Litchfield, our Chief Financial Officer and Chief Corporate Strategy Officer.

Kishore Seendripu: In broadband and connectivity, we are executing large-scale deployments of our single-chip fiber PON and Wi-Fi 7 gateway platforms with a second major tier 1 service provider in North America, with additional ramps expected later in the year in Europe. These long-cycle deployments provide a stable foundation, leverage the same strengths in integration and power efficiency that clearly differentiate MaxLinear's data center portfolio. In summary, we are very pleased with the strong start to 2026 and are especially excited by the momentum accelerating in our optical data center business. With multiple customers entering meaningful ramps of our 800G Keystone family and broader engagement across our 1.6 terabit Rushmore and Annapurna product families across scale-out and scale-up AI architectures, we believe MaxLinear is exceptionally well positioned for sustained transformative growth.

Speaker #2: Thanks, Kishore. Total revenue for the first quarter was $137.2 million, up from $136.4 million in the previous quarter and up 43% from $95.5 million in the first quarter of 2025.

Speaker #2: Infrastructure revenue for the first quarter of '26 was approximately $63 million. Broadband revenue was approximately $44 million. Connectivity revenue was approximately $19 million. And industrial multi-market revenue was approximately $12 million.

Speaker #2: GAAP and non-GAAP gross margins for the first quarter were 57.5% and 59.5% of revenue, respectively. The delta between GAAP and non-GAAP gross margin in the first quarter was primarily driven by $2.6 million of acquisition-related intangible asset amortization.

Speaker #2: First quarter GAAP operating expenses were $96.1 million, and non-GAAP operating expenses were $59.9 million. The delta between GAAP and non-GAAP operating expenses was primarily due to stock-based compensation.

Kishore Seendripu: Our disciplined focus on execution and innovation gives us confidence that 2026 will be a pivotal year as we continue to evolve our strategy and deliver long-term value for our customers and shareholders. With that, let me now turn the call over to Steven Litchfield, our Chief Financial Officer and Chief Corporate Strategy Officer.

Speaker #2: And performance-based equity accruals of $28.5 million. Combined acquisition-related costs and other costs of $6.5 million. GAAP loss from operations for Q1 2026 was 13%, and non-GAAP income from operations in Q1 was 16% of net revenue.

Steven Litchfield: Thanks, Kishore. Total revenue for Q1 was $137.2 million, up from $136.4 million in the previous quarter and up 43% from the $95.5 million in Q1 2025. Infrastructure revenue for Q1 2026 was approximately $63 million. Broadband revenue was approximately $44 million. Connectivity revenue was approximately $19 million, and industrial multimarket revenue was approximately $12 million. GAAP and non-GAAP gross margins for Q1 was 57.5% and 59.5% of revenue. The delta between GAAP and non-GAAP gross margin in Q1 was primarily driven by $2.6 million of acquisition-related intangible asset amortization. Q1 GAAP operating expenses were $96.1 million, and non-GAAP operating expenses were $59.9 million.

Speaker #2: GAAP and non-GAAP interest and other expenses during the quarter were $1.4 million and $1.3 million, respectively. In Q1, net cash flow used in operating activities was approximately $8.9 million.

Speaker #2: We exited Q1 of 2026 with approximately $89.9 million in cash, cash equivalents, and restricted cash. The primary use of cash was due to substantial prepayment for waivers supporting rising demand for our data center low-geometry products, for which we have increasing order backlog in the second half of the year.

Speaker #2: Our day sales outstanding was down in Q1 to approximately 27 days. Our inventory was up by approximately $8 million versus the previous quarter, with days of inventory improving to approximately 128 days.

Steven Litchfield: The delta between GAAP and non-GAAP operating expenses was primarily due to stock-based compensation and performance-based equity accruals of $28.5 million combined, and acquisition-related cost and other cost of $6.5 million. GAAP loss from operations for Q1 2026 was 13%, and non-GAAP income from operations in Q1 was 16% of net revenue. GAAP and non-GAAP interest and other expense during the quarter was $1.4 million and $1.3 million, respectively. In Q1, net cash flow used in operating activities was approximately $8.9 million. We exited Q1 of 2026 with approximately $89.9 million in cash equivalents, and restricted cash. The primary use of cash was due to substantial prepayment for wafers supporting rising demand for our data center load geometry products, for which we have increasing order backlog in H2 of the year.

Speaker #2: This concludes the discussion of our Q1 financial results. With that, let's turn to our guidance for Q2. We currently expect revenue in the second quarter of 2026 to be between $160 million and $170 million.

Speaker #2: Looking at Q2 by end market, we expect to see growth from all four of our business segments, with particular strength in infrastructure, driven by data center optical interconnects.

Speaker #2: We expect second quarter GAAP gross margin to be approximately 56% to 59%, and non-GAAP gross margin to be in the range of 58% to 61% of revenue.

Speaker #2: We expect Q2 2026 GAAP operating expenses to be in the range of $91 million to $97 million. We expect Q2 2026 non-GAAP operating expenses to be in the range of $61 million to $66 million.

Speaker #2: We expect our Q2 GAAP interest and other expense to be in the range of approximately $1.8 million to $2.2 million. We expect our Q2 non-GAAP interest and other expense to be in the range of $1.8 million to $2.2 million, with FX volatility being the primary risk.

Steven Litchfield: Our day sales outstanding was down in Q1 to approximately 27 days. Our inventory was up by approximately $8 million versus the previous quarter, with days of inventory improving to approximately 128 days. This concludes the discussion of our Q1 financial results. With that, let's turn to our guidance for Q2. We currently expect revenue in Q2 2026 to be between $160 million and $170 million. Looking at Q2 by end market, we expect to see growth from all four of our business segments, with particular strength in infrastructure driven by data center optical interconnects. We expect Q2 GAAP gross margin to be approximately 56% to 59%, and non-GAAP gross margin to be in the range of 58% and 61% of revenue. We expect Q2 2026 GAAP operating expenses to be in the range of $91 million to $97 million.

Speaker #2: We expect a $2 million tax benefit on a GAAP basis, and a non-GAAP tax provision of approximately $1 million. We expect our GAAP and non-GAAP dilutive share count in Q2 to be approximately 95 million each.

Speaker #2: In summary, with strong growth in our data center optical business and several additional high-value products still early in their market ramp, we have transformed MaxLinear into an infrastructure-focused company.

Speaker #2: Our investments over the past several years have brought us to this point where we are well-positioned to deliver sustained growth, operating leverage, and increasing shareholder value.

Speaker #2: We're excited about the opportunities ahead and confident in our ability to execute. With that, I'd like to open up the call for questions. Operator?

Steven Litchfield: We expect Q2 2026 non-GAAP operating expenses to be in the range of $61 to 66 million. We expect our Q2 GAAP interest and other expense to be in the range of approximately $1.8 to 2.2 million. We expect our Q2 non-GAAP interest in other expense to be in the range of $1.8 to 2.2 million, with FX volatility being the primary risk. We expect a $2 million tax benefit on a GAAP basis and a non-GAAP tax provision of approximately $1 million. We expect our GAAP and non-GAAP dilutive share count in Q2 to be approximately 95 million each. In summary, with strong growth in our data center optical business and several additional high-value products still early in their market ramp, we have transformed MaxLinear into an infrastructure-focused company.

Speaker #3: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press *1 on your telephone keypad.

Speaker #3: A confirmation tone will indicate that your line is in the question queue. You may press *2 if you would like to remove your question from the queue.

Speaker #3: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the * keys. We ask that analysts limit themselves to one question and a follow-up so that others may have an opportunity to do so as well.

Speaker #3: One moment, please, while we pull for questions. Our first question comes from Tori Sandberg with Stifel. Please proceed with your question.

Speaker #4: Yes, thank you, and congrats on the momentum here. Kishore, you mentioned optical DSP revenue not tracking to $150 to $170 million. I think that's about $30 to $40 million higher than what you had expected before.

Speaker #4: Just wondering, what transpired intra-quarter to see such a steep increase? Are there new customers? Are you basically just seeing a steeper ramp at existing customers?

Steven Litchfield: Our investments over the past several years have brought us to this point where we are well positioned to deliver sustained growth, operating leverage, and increasing shareholder value. We're excited about the opportunities ahead and confident in our ability to execute. With that, I'd like to open up the call for questions. Operator?

Speaker #4: Any more color you can add on that additional revenue would be great. Thank you.

Speaker #5: Thank you, Tori. Yes. At the time when we set the guidance, we obviously are looking at a number of ramps at a number of customers.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that analysts limit themselves to one question and a follow-up so that others may have an opportunity to do so as well. One moment, please, while we pull for questions. Our first question comes from Tore Svanberg with Stifel. Please proceed with your question.

Speaker #5: And we were being conservative. At the same time, we were also fairly optimistic internally that we should be seeing strong growth coming in the latter half of this year.

Speaker #5: Now, with all the visibility and the lead times that are necessary for providing the product, we have very good visibility, and the ramps are setting in very nicely, both across 400-gig and 800-gig solutions.

Speaker #5: So, I just think it's all about the timing of the ramps, and the success of the calls, and our ability to scale up to meet the demand—the surging demand we are seeing now.

Tore Svanberg: Yes, thank you, and congrats on the momentum here. Kishore, you mentioned optical DSP revenue now tracking to 150 to 170. I think that's about $30 to 40 million higher than what you had expected before. Just wondering what transpired intra-quarter to see such a steep increase. Is this new customers? Are you basically just seeing steeper ramp at existing customers? Any more color you can add on that additional revenue would be great. Thank you.

Speaker #4: Very good. And I was going to follow up for you, Steve. So, you mentioned that prepayment for waiver capacity. I'm just wondering, are you sort of done with that now, or should we expect more cash outflows in the coming quarters?

Speaker #4: And I also noticed you increased the revolver by $30 million. So, anything you can say here on the balance sheet and cash position going forward?

Speaker #4: Thank you.

Speaker #5: Yeah, sure, Tori. Not a problem. So, consistent with what we raised back in Q4 of last year, we knew we would have some working capital needs, kind of going into Q4 as well as Q1.

Kishore Seendripu: Thank you, Tore. Yes, at the time when we set the guidance, we obviously are looking at a number of ramps at a number of customers and we were being conservative. At the same time we were also fairly optimistic internally that we should be seeing strong growth coming in the H2 of this year. Now, with all the visibility and the lead times that are necessary for providing the product, we have very good visibility, and the ramps are setting in very nicely, both across 400G and 800G solutions. I just think it's all about timing of the ramps and the success of the quals and our ability to scale up to meet the surging demand we are seeing now.

Speaker #5: So that certainly played out the way that we expected. Are we through it entirely? I mean, I guess to some degree, it depends on how much demand continues to improve, right, as that demand improves.

Speaker #5: Certainly, we may continue to see some prepayments, but we do think you'll start to see this inflect as the revenues increase. The second part of your question on the revolver—yeah, we did have a revolver that was expiring in June.

Speaker #5: So we renewed the revolver. We did take it up slightly, pretty minor move for the size of the company and the direction of the company.

Tore Svanberg: Very good. As a follow-up for you, Steve, so you mentioned that prepayment for wafer capacity. I'm just wondering, are you sort of done with that now? Or should we expect more cash outflows in the coming quarters, and I also noticed you increased the revolver by $30 million. Anything you can say here on the balance sheet and cash position going forward? Thank you.

Speaker #4: Great. Thank you.

Speaker #3: Our next question comes from Joe with Wells Fargo & Co. Please proceed with your question.

Speaker #6: Yeah, thanks for taking the question. Maybe just to follow up on that, I guess, can you talk about your supply chain and capacity to support the growth that you're seeing?

Speaker #6: Clearly, the mix of your growth will be a bit different than maybe previously when you were at kind of similar revenue levels.

Steven Litchfield: Yeah. Sure, Tory. Not a problem. Consistent with what we raised back in Q4 of last year, we knew we would have some working capital needs kind of going in Q4 as well as Q1. That certainly played out the way that we expected. Are we through it entirely? I guess to some degree, depends on how much demand continues to improve, right? As that demand improves, certainly we may continue to see some prepayments, but you'll start to see this inflect as the revenues increase. The second part of your question on the revolver. Yeah, we did have a revolver that was expiring in June, we renewed the revolver. We did take it up slightly, a pretty minor move for the size of the company and the direction of the company.

Speaker #5: Yeah, Joe, I'll take this. I mean, look, I don't think it's any surprise to anyone—there are some supply constraints out there. But I think we planned well for this and worked really closely with the partners.

Speaker #5: On this front, I think we've seen really good success, and we expect to continue to see that going forward.

Speaker #4: Okay. And then as a follow-up, can you talk maybe a little bit about the puts and takes on the gross margin guidance? Why wouldn't we see maybe a little bit more leverage on the sequential revenue step-up that's pretty significant here?

Speaker #5: Yeah. No. I mean, obvious question. I think this is consistent with what we've been seeing. You've heard my caution on this, Joe, and it's a little bit of the input cost.

Tore Svanberg: Okay, thank you.

Speaker #5: So certainly, there's some concerns out there as wafer cost, packaging, etc., are moving up. In a lot of cases, the industry, ourselves included, have been able to pass along these costs.

Operator: Our next question comes from Joe Quatrochi with Wells Fargo & Co. Please proceed with your question.

Joe Quatrochi: Yeah, thanks for taking the question. Maybe just to follow up on that. I guess, can you talk about just your supply chain and capacity to support the growth that you're seeing? Clearly, the mix of your growth be a bit different than maybe previously when you were at kind of similar revenue levels.

Speaker #5: And so we expect that to be the case. But just kind of given the uncertainty out there, I think we just want to remain cautious. But you're absolutely right from the understanding that the infrastructure business typically does drive a higher gross margin.

Speaker #5: So we're very optimistic as we look out the rest of this year and even into next year, and that being a positive influence on our gross margins.

Steven Litchfield: Yeah, Joe, I'll take this. Look, I don't think it's any surprise to anyone, there's some supply constraints out there. I think we've planned well for this and worked really closely with the partners on this front. I think we've seen really good success, and we expect to continue to see that going forward.

Speaker #3: Our next question comes from Tim Savage with Northland Capital Markets. Please proceed with your question.

Joe Quatrochi: Okay. As a follow-up, can you talk maybe a little bit about the puts and takes on the gross margin guidance? Why wouldn't we see maybe a little bit more leverage on the sequential revenue step-up that's pretty significant here?

Speaker #7: Hi. And congrats on the results and especially the guidance. The question on the infrastructure side, and I know that's mostly data center driven, but it looks like you grew something in the mid-30s sequentially.

Steven Litchfield: Yeah. No, obvious question. I think this is consistent with what we've been seeing. You've heard my caution on this, Joe, and it's a little bit of the input cost. Certainly there's some concerns out there. Wafer costs, packaging, et cetera, are moving up. In a lot of cases, the industry, ourselves included, have been able to pass along these costs, and so we expect that to be the case. Just kind of given the uncertainty out there, I think we just want to remain cautious. You're absolutely right from the understanding that the infrastructure business typically does drive a higher gross margin. We're very optimistic as we look out the rest of this year and even into next year in that being a positive influence on our gross margins.

Speaker #7: In Q1, and I imagine data center was a big driver there. Given what you're guiding to, do you expect some sequential growth of a similar magnitude in Q2 in infrastructure?

Speaker #5: Yeah. I think, Tim, from my standpoint—I mean, we obviously didn't, we don't typically guide in detail. We did say that it was going up.

Speaker #5: We did emphasize in our prepared remarks that, I mean, as we look at this year, now clearly, the infrastructure business has much bigger growth drivers.

Speaker #5: We have a lot of new products that are ramping with some new customers, so we would certainly expect infrastructure to be a much bigger driver of growth in the coming year.

Speaker #7: Okay. And to follow up once again, given the step-up we’re seeing in Q2, do you have any comments about overall revenue growth expectations for '26?

Operator: Our next question comes from Tim Savageaux with Northland Capital Markets. Please proceed with your question.

Speaker #7: Looks like we could be tracking—I don't know—35, 40 percent, but any comment from your company?

Tim Savageaux: Hi, and congrats on the results and especially guidance. Question on the infrastructure side, and I know that's mostly data center driven, but looks like you grew something mid-30s sequentially in Q1. I imagine data center was a big driver there. Given what you're guiding to, do you expect some sequential growth of a similar magnitude in Q2 in infrastructure?

Speaker #5: Yeah. I mean, look, we only guide one quarter, and we're not going to change that here today. We are very excited about the growth potential that we have.

Speaker #5: And these new customers and the new product ramps, and yeah, so I think, and frankly, with the visibility that we have, we start to roll into '27 as well.

Speaker #5: I mean, I think we're excited to see the growth in '26, and even backlogs starting to build into 2027.

Steven Litchfield: Yeah, I think, Tim, from my standpoint, we obviously don't typically guide end markets in that level of detail. We did say that it was going up. We did emphasize in our prepared remarks that as we look at this year, now, clearly the infrastructure business has much bigger growth drivers. We have a lot of new products that are ramping with some new customers. We would certainly expect infrastructure to be a much bigger driver of growth in the coming year.

Speaker #7: Okay. Thanks very much.

Speaker #5: Thanks, Tim.

Speaker #3: Our next question comes from Anata Bruhat with Loop Capital Markets. Please proceed with your question.

Speaker #8: Yeah, good afternoon, guys. Really appreciate the question. And yeah, congrats on doing all the work to get to this place. With DSP, it's cool to see it play out.

Tim Savageaux: Okay. To follow up once again, given the step-up we're seeing in Q2, do you have any comments about overall revenue growth expectations for 2026? Looks like we could be tracking, I don't know, 35%, 40%, but any comment from the company?

Speaker #8: Yeah, you guys are very welcome. Kishore, you mentioned just this first question as a DSP question. You mentioned in response to one of the prior questions about the magnitude of the step-up and guidance, that you guys have baked in some conservatism, sort of at program start ramp here.

Steven Litchfield: Yeah. Look, we only guide one quarter, and we're not going to change that here today. We are very excited about the growth potential that we have, these new customers, and the new product ramps. Yeah, and frankly, with the visibility that we have, we start to roll into 2027 as well. I think we're excited to see the growth in 2026 and even backlog starting to build into 2027.

Speaker #8: And that contributed to, sort of, the magnitude of the step-up and guide. Can you guys tell—though I guess what I'm also wanting to ask is—can you tell if the market ramp feels bigger than what you guys had originally anticipated, as distinct from conservatism?

Tim Savageaux: Okay, thanks very much.

Speaker #8: And I guess, let me just ask that question. Do you have any sense of if the market ramp feels bigger, if the market TAM feels bigger?

Steven Litchfield: Thanks, Tim.

Operator: Our next question comes from Ananda Baruah with Loop Capital Markets. Please proceed with your question.

Speaker #8: And then I have a quick follow-up as well, thanks.

Speaker #5: So let me answer the first question. Obviously, the TAM expansion is real. Or the SAM expansion—even more so, the PAM4 DSP expansion is very real.

Ananda Baruah: Yeah, good afternoon, guys. Really appreciate the question. Yeah, congrats on doing all the work to get to this place with DSP. It's cool to see it play out.

Speaker #5: As both US and China hyperscalers are deploying very, very rapidly, and depending on the architecture implementation, the amount of PAM4 DSP use can vary completely based on the GPU configurations.

Operator: Can you-

Ananda Baruah: Yeah, you guys are very welcome. Kishore, you mentioned just as a first question as a DSP question. You mentioned to one of the prior questions that around the magnitude of the step-up in guide that you guys had baked in some conservatism, sort of at program start ramp here, and that that contributed to sort of the magnitude, the step-up in guide. Can you guys tell though, I guess what I'm wanting to ask is, can you tell if the market ramp feels bigger than what you guys had originally anticipated as distinct from conservatism? I guess what I'm just. Let me just ask that question. Do you have any sense of if the market ramp feels bigger, if the market TAM feels bigger? Then I have a quick follow-up as well. Thanks.

Speaker #5: And so, scale-up and scale-out are both equally growing very strongly. So, to the extent that we are conservative, it's in the balance of things—that's our general positioning as a company.

Speaker #5: Right? So I don't think that's behaviorally any different from us. Do we expect more upsides? Absolutely. We do expect more upsides. That is commensurate with all the programs reaching full run rates.

Speaker #5: So, I hope that answers the first question. So, your second question, please.

Speaker #8: Oh, yeah. On Panther, you had mentioned Panther's benefiting from some of the memory dynamics. In the marketplace, can you just walk us through—is that, walk us through the ways in which Panther is holistically benefiting?

Kishore Seendripu: Let me answer the first question. Obviously, the TAM expansion is real, or the SAM expansion even more so. The PAM4 DSP expansion is very real as both US and China hyperscalers are deploying very rapidly. Depending on the architecture implementation, the amount of PAM4 DSPs used can vary completely based on the GPU configurations. Scale-out and scale-up are both equally growing very strongly. The extent that we are conservative, it's in the balance of things. That's our general positioning as a company, right? I don't think that's behaviorally any different from us. Do we expect more upsides? Absolutely. We do expect more upsides that is commensurate to all the programs reaching full run rates. I hope that answers the first question. Your second question, please.

Speaker #8: Is it as simple as memory short, Panther provides performance, and you've been waiting here with Panther as well, so you're benefiting? Or are there more sophisticated, nuanced reasons as well that Panther is benefiting?

Speaker #5: Yeah, all this, obviously, being sophisticated, nuanced to Panther, right? And now, of course, memory is fashionable, right? Not three years ago when we got punished for some of our actions.

Speaker #5: About 60% of the data center spend is in memory. But all memory is not equal as the AI engine moves forward and accelerates. Low latency, high capacity memory access is super important.

Speaker #5: So the big benefit of Panther is it's an accelerator. So it reduces latency dramatically, and the power efficiency that brings to it. So it enables much more.

Ananda Baruah: Oh, yeah. On Panther, you had mentioned Panther is benefiting from some of the memory dynamics in the marketplace. Can you just walk us through the ways in which Panther is holistically benefiting? Is it as simple as memory shortage, Panther provides performance, and you've been waiting here with Panther as well, so you're benefiting? Or are there more sophisticated nuanced reasons as well that Panther is benefiting?

Speaker #5: Capability than just a memory compression, right? So I really feel that the performance part related to low latency, high bandwidth access enablement that Panther provides is the key differentiator.

Speaker #5: Thus far, our use of Panther has been really at the enterprise appliance level, if you will. But now, these enterprise storage appliances are getting increasingly deployed into mainstream cloud centers.

Speaker #5: So I really feel there's much more to come with Panther 5 and Panther 6 in the future, and this is just the beginning of our Panther product—Panther roadmap product family.

Kishore Seendripu: Yeah. There's obviously been sophisticated nuance to Panther, right? Now, of course, memory is fashionable, right? Not three years ago when we got punished for some of our actions. 60% of the data center spend is in memory. All memory is not equal. As the AI engine moves forward, accelerates, low latency, high capacity memory access is super important. The big benefit of Panther is it's an accelerator, so it reduces latency dramatically and the power efficiency that brings to it, so enables much more capability than just a memory compression, right? I really feel that the performance part related to low latency, high bandwidth access enablement that Panther provides is the key differentiator. Thus far, our use of Panther has been really at the enterprise appliance level, if you will. Now these enterprise storage appliance are getting increasingly deployed into mainstream cloud centers.

Speaker #5: So, we expect this year the revenues to double. We have said that before. And hopefully, next year as well, we've got very strong growth based on the visibility we have.

Speaker #8: With all that said, do you feel bigger about the ultimate TAM potential for Panther? Big picture.

Speaker #5: Absolutely. In the big picture, absolutely, Panther has a lot of potential. But Panther as it is today would not be sufficient, right? The world and the deployment models evolve.

Speaker #5: So, there’ll be more investment required. But the TAM is pretty huge, and we just have to keep on converting more of the TAM into our SAM.

Speaker #5: And that will drive our roadmap.

Speaker #8: Thank you. Appreciate it.

Speaker #3: Our next question comes from Christopher Roland with Susquehanna International Group. Please proceed with your question.

Speaker #9: Hey, guys. Thanks for the question. Congrats on the strong results. And I apologize if this was asked, but in your prepared remarks—or actually, in the press release—you talked about, for optical, multiple hyperscalers. And previously, I think your messaging around optical was it was very broad-based.

Kishore Seendripu: I really feel there's much more to come with Panther V and Panther 6 in the future, and this is just the beginning of our Panther roadmap product family. We expect this year the revenues to double. We have said that before. Hopefully next year as well, we got very strong growth, based on the visibility we have.

Speaker #9: I think at OFC, we see all the design wins across so many different optical vendors. But this seems like it's a big change, and might be changing customer concentration.

Ananda Baruah: With all that said, do you feel bigger about the ultimate TAM potential for Panther? Big picture.

Kishore Seendripu: In the big picture, absolutely Panther has a lot of potential, but Panther, as it is today, would not be sufficient, right? The world and the deployment models evolve, so there'll be more investment required, but the TAM is pretty huge, and we just have to keep on converting more of the TAM into our SAM, and that will drive our roadmap.

Speaker #9: Perhaps if you could talk a little bit about that, are you now diversifying around these key hyperscaler opportunities? Is it like one or two, or all of them?

Speaker #9: And yeah, if you could, if you could elaborate a little bit as to what seems like is a pretty meaningful change here, that would be great.

Ananda Baruah: Thank you. Appreciate it.

Speaker #5: Yes, thank you, Chris. It is pretty broad-based. Our design wins are across all the module vendors in the world. So we have designs—we have always maintained that we have designs across all the module vendors.

Operator: Our next question comes from Christopher Rolland with Susquehanna International Group. Please proceed with your question.

Christopher Rolland: Hey, guys. Thanks for the question. Congrats on the strong results. I apologize if this was asked, but in your prepared remarks, or actually in the press release, you talked about, for optical, multiple hyperscalers. Previously, I think your messaging around optical was. It was very broad-based. I think, at OFC, we see all the design wins across so many different optical vendors. This seems like it's a big change, and might be changing customer concentration. Perhaps if you could talk a little bit about that. Are you now diversifying around these key hyperscaler opportunities? Is it one or two or all of them? Yeah, if you could elaborate a little bit as to what seems like is a pretty meaningful change here, that would be great.

Speaker #5: It's taken a while to map the module vendors' victories with the various end data centers, while we ourselves had to sort of do the business development work that creates the pull for various module vendors.

Speaker #5: So even at the end customers, it's pretty broad-based. Obviously, we'll be concentrated on a few during the ramps, and as the ramp expands into 2027, we'll have other data centers that come online.

Speaker #5: But even as we speak now, it's a pretty broad-based success. Is there more work to do to expand further? Yes, I think we are only halfway there to our end data center diversification across all the hyperscalers.

Speaker #5: So, there's more work to be done. But what Keystone provides us is an affirmative statement of MaxLinear's ability to successfully get through the interops supply product at scale.

Speaker #5: Remember, we were worried about our ability to supply, and provided a scale where it's very confidence boosting in terms of our credibility as a world-class chip supplier.

Kishore Seendripu: Yes. Thank you, Chris. It is pretty broad-based, our design win, because all the module vendors in the world. We have designs. We've always maintained that we have designs across all the module vendors. It's taken a while to map the module vendors victories with the various end data centers, while we ourselves had to sort of do the business development work that creates the pull for various module vendors. Even at the end customers, it's pretty broad-based. Obviously, we'll be concentrating on a few during the ramps, and as the ramp expands into 2027, we'll have other data centers that come online. Even as we speak now, it's a pretty broad-based success. Is there more work to do to expand further? Yes, I think we are only halfway there to our end data center diversification across all the hyperscalers.

Speaker #9: Thank you for that. Kishore, maybe a quick follow-up. I guess if you could perhaps talk about 1.6T—how you think design wins and the ramp will go there. Is 800 just kind of the beginning?

Speaker #9: They're qualifying on 800, and then they have plans to use you guys at 1.6, and they've communicated these plans. And then you also mentioned scale-up optical for scale-up in your press release as well.

Speaker #9: I don't think there's a huge transceiver usage for scale-up right now, mostly scale-out. So if you could talk about that and what that means for you guys, that'd be great as well.

Kishore Seendripu: There's more work to be done, but what Keystone provides us is an affirmative statement of MaxLinear's ability to successfully get through the interops, supply product at scale. Remember, we were worried about our ability to supply and provide it at scale, where it's very confidence-boosting in terms of our credibility as a world-class chip supplier.

Speaker #5: Okay. So you hit many different topics here, right? So there are going to be different deployment models for scale-up to start with, right?

Speaker #5: There are many, many different product categories on scale up. Having said that, the optical transceivers—30% of the market is for scale up.

Christopher Rolland: Thank you for that, Kishore. Maybe a quick follow-up. I guess, if you could perhaps talk about 1.6T, like how you think design wins and the ramp will go there. Is 800 just the beginning? They're qualifying on 800, and then they have plans to use you guys at one six, and they've communicated these plans. You also mentioned scale-up, optical for scale-up, in your press release as well. I don't think there's a huge transceiver usage for scale-up right now, mostly scale-out. If you could talk about that, and what that means for you guys, that'd be great as well.

Speaker #5: Right? And that's a pretty substantial part of the TAM. And 70% is for scale-out today. Our participation in scale-up derives from the optical transceivers as well as now the new offering in 1.6 terabyte for electrical retimers, which is onboard retimers.

Speaker #5: And for the active electrical cables as well. Those are all scale up-based applications. So I hope that answers your question of where our scale up opportunities are coming from.

Speaker #5: They're really in that 30% of the TAM I talked about. So moving forward to $1.6 trillion, the critical thing to keep in mind is that there is enormous confidence out there. We're shipping Keystone to major data centers today and ramping very strongly in 2026.

Kishore Seendripu: Okay. You hit a number of topics here, right? There are going to be different deployment models for scale-up to start with, right? There are many different product categories on scale-up that are discussed. Having said that, for the optical transceivers, 30% of the market is for scale-up, right? That's a pretty substantial part of the TAM, and 70% is for scale-out today. Our participation in scale-up derives from the optical transceivers as well as now the new offering in 1.6 terabit for electrical retimers, which is onboard retimers, and for the active electrical cables as well. Those are all scale-up based applications. I hope that answers your question of where our scale-up opportunities are coming from. They're really in that 30% of the TAM I talked about.

Speaker #5: And we are now rolled out our 1.6 terabyte Rushmore product Annapurna family for electrical applications. And I think that this level of execution apart and the success with the cloud relationship, module partnerships, and the core and interop completion is creating a far more pull for our 1.6T participation than I would have guessed at this point in time.

Speaker #5: So in a sense, we hope that by the end of the year, we'll have called on 1.6T and start transitioning not transitioning. I just want to keep this point that 800G 1.6 terabyte will probably be one of the most long-lasting interconnect applications in the data center world.

Speaker #5: So having 1.6T will actually expand our ability to garner more revenues and more market share.

Speaker #9: Excellent. Thank you, guys, and congrats again.

Speaker #5: Thank you.

Speaker #10: Thanks, Chris.

Kishore Seendripu: Moving forward to 1.6T, the critical thing to keep in mind is that there is enormous confidence out there. We're shipping Keystone to major data centers today, and they're ramping very strongly in 2026. We are now rolled out our 1.6 terabit Rushmore product, Annapurna family for electrical applications. I think that this level of execution on our part and the success with the cloud relationships, module partnerships, and the call and interrupt completion is creating a far more pull for our 1.6T participation than I would have guessed at this point in time. In a sense, we hope that by the end of the year, we'll have called on 1.6T. I just want to keep this point that 800G 1.6 terabits will be probably one of the most long-lasting interconnect applications in the data center world.

Speaker #11: Our next question comes from Richard Shannon with Craig-Hallum Capital Markets. Please proceed with your question.

Speaker #12: Well, thanks, guys, for taking my question. Maybe a follow-up on the topic of DSP here and asking questions slightly different way here, which is obviously your 400 and 800 gig with Keystone are going very well.

Speaker #12: And I heard some relatively positive comments about Rushmore so far here. I'd love to get a sense here, since it seems like you're gaining some very nice share in Rushmore here.

Speaker #12: Excuse me, in Keystone. To what degree is this conveying directly or could it convey directly to success in Rushmore? And how do you view the potential revenue trajectory over a period of time relative to what you've seen so far with Keystone?

Speaker #5: Thank God for Keystone, right? So it's everything valuable takes a long time. It has taken us a long journey through two, three generations of investment.

Speaker #5: Now we are into Rushmore. And the success of Keystone makes us an incumbent, right? And the power of incumbency is the ability to have the relationships with the cloud customers, the module makers, the confidence in your ability to supply, and the quality of your product.

Kishore Seendripu: Having 1.6T will actually expand our ability to garner more revenues and more market share.

Christopher Rolland: Excellent. Thank you guys, and congrats again.

Kishore Seendripu: Thank you.

Speaker #5: On the 1.6-terabyte solution, I dare say we are in the top tier in the performance category. And our customers acknowledge that. So they're readily going to develop solutions that would be quickly moved to the next phase of calls, etc., with the data center folks.

Steven Litchfield: Thanks, Chris.

Operator: Our next question comes from Richard Shannon with Craig-Hallum Capital Group. Please proceed with your question.

Richard Shannon: Well, thanks, guys, for taking my question. Maybe I'll follow up on the topic of DSP here and ask the question slightly different way here, which is obviously your 400G, 800G with Keystone are going very well. Heard some relatively positive comments about Rushmore so far here. I'd love to get a sense here since it seems like you're gaining some very nice share in Rushmore here, excuse me, in Keystone. To what degree is this conveying directly or could it convey directly to success in Rushmore? And how do you view the potential revenue trajectory over a period of time relative to what you've seen so far with Keystone?

Speaker #5: As you know, we are not the first ones with 1.6 terabyte relative to our incumbent competitors—two of them—so I really feel it bodes very, very well.

Speaker #5: And with 1.6 terabytes, you expect the ASPs to increase, right? So clearly, for the same units, or even expanding units that are happening, the TAM dollars substantially increase.

Speaker #5: So as the mix becomes more and more 1.6 terabyte, I really believe that you'll have an uplifting effect on our revenues and gross margins, even as our market share expands.

Kishore Seendripu: Thank God for Keystone, right? Everything valuable takes a long time. It has taken us a long journey through two, three generations of investment. Now we are into Rushmore, and the success of Keystone makes us an incumbent, right? The power of incumbency is the ability to have the relationships with the cloud customers, the module maker, the confidence in your ability to supply, and the quality of your product. On the 1.6 terabit solution, I dare say we are in the top tier on the performance category. Our customers acknowledge that, so they're readily going to develop solutions that would be quickly moved to the next phase with calls, et cetera, with the data center folks. As you know, we are not the first ones with 1.6 terabit relative to our incumbent competitors, two of them.

Speaker #12: Okay. Kishore, thanks for that detail. My following question is on the cable and broadband space here. Just generally, I'd love to get a sense of your expectations for the trajectory of this year.

Speaker #12: Last call, you talked about a soft first half. Certainly, your starting point shows that here. And then talking about calendar 2016 being down, which I can completely believe here.

Speaker #12: But I want to get a sense of your any update on that and whether you have any visibility into when DOCSIS 4.0 starts to have an impact.

Speaker #5: So, thank you for the question, right? We had a spectacular growth year in '25 for broadband—grew about 75%. And so we had a pullback in Q1, which is also some seasonality built into it.

Speaker #5: But happy to say they're looking forward. All our businesses are growing, actually, which is sort of a tailwind. As our data center-centric and infrastructure revenues grow, we also have other segments of our diversified portfolio really generating some positive momentum as well.

Kishore Seendripu: I really feel it bodes very well, and with 1.6 terabit, you expect the ASPs to increase, right? Clearly for the same units or even expanding units that are happening, the TAM dollar substantially increased. As the mix becomes more and more 1.6 terabit, I really believe that it'll have an uplifting effect on our revenues and gross margins, even as our market share expands.

Speaker #5: So, I'm happy to share that we expect our broadband business to continue to start growing from Q2 and into 2027. And I think cable DOCSIS 4.0 certifications are happening, but some of the operators are still delayed on their network readiness.

Richard Shannon: Okay. Kishore, thanks for that detail. My follow-up question is on the cable and broadband space here. Just generally, love to get a sense of your expectations for the trajectory of this year. Last call, you talked about a soft H1. Certainly, your starting point shows that here, and then talking about calendar 2026 cable being down, which I can completely believe here. Want to get a sense of any update on that and whether you have any visibility into when DOCSIS 4.0 starts to have an impact.

Speaker #5: However, a big growth is coming with ultra DOCSIS 3.1 and 4.0 into 2027. The one thing that's happened post-COVID is that during the down period, right, we have been winning market share in broadband, which bodes very well for our fiber play.

Speaker #5: In fact, fiber PON business continues to grow through Q1, Q2. And we tier one operator in North America. And that's happening in the second half of the year, for which we've already done free shipments.

Kishore Seendripu: Thank you for the question. We had a spectacular growth year in 2025 for broadband, grew about 75%. We had a pullback in Q1, which is also some seasonality built into it. Happy to say that looking forward, all our businesses are growing actually, which is sort of a tailwind that as our data centric and infrastructure revenues grow, we also have other segments of our diversified portfolio really generating some positive momentum as well. I'm happy to share that we expect our broadband business to continue to start growing from Q2 and into 2027. I think cable DOCSIS 4.0 certifications happen, but some of the operators are still delayed on their network readiness. However, a big growth is coming with ultra DOCSIS 3.1 and 4.0 into 2027.

Speaker #5: And then later, we have European deployments. I think it's all good. It's all growing. And we've waited for a time to recover through the COVID slowdown.

Speaker #5: I think we feel very good about that.

Speaker #12: Okay. Great. Thank you, guys.

Speaker #5: Yep.

Speaker #11: Our next question comes from Carl Ackerman with BNP Paribas. Asset management. Please proceed with your question.

Speaker #12: Yes, thank you. I have two clarifications, if I may. Kishore, just going back—you spoke briefly about cable and broadband just now.

Speaker #12: But could you be more specific with respect to the June quarter guide? It seems like most of the growth is coming from infrastructure. But can you talk about what your outlook is for broadband, connectivity, and multi-market, whether they can all grow in a sequential basis in the June quarter too?

Kishore Seendripu: The one thing that's happened post-COVID is that during the down period, we have been winning market share in broadband, which bodes very well for our fiber play. In fact, fiber PON business continues to grow through Q1, Q2, and we started major deployment with a major tier one operator in North America. That's happening in the H2 of the year, for which we've already done pre-shipments. Then later we have European deployments. I think it's all good. It's all growing. We waited for a time to recover through the COVID slowdown. I think we feel very good about that.

Speaker #12: Not a follow-up, please.

Speaker #5: Hey, Carl, Steve. Yeah, thanks for the question. Yeah, I think we mentioned earlier all four end markets will be up. I mean, I do expect a lot of that growth to be from infrastructure.

Speaker #5: Just seeing the inflection that we're seeing from particularly some of the data center products. So yeah, that is our expectation.

Speaker #12: Got it, got it. Okay. And then just to follow up on Chris's earlier question, is much of your optical DSP growth coming from hyperscaler-owned designs?

Speaker #12: And therefore, you are qualifying with them directly? Or is your hyperscaler exposure predominantly through module vendors providing a merchant solution?

Richard Shannon: Okay, great. Thank you, guys.

Kishore Seendripu: Yep.

Operator: Our next question comes from Karl Ackerman with BNP Paribas Asset Management. Please proceed with your question.

Speaker #5: Both.

Speaker #12: Got it. Thank you very much.

Karl Ackerman: Yes. Thank you. I have two clarifications, if I may. Kishore, just going back to you spoke briefly about cable and broadband just now, but could you be more specific with respect to the Q2 guide? It seems like most of the growth is coming from infrastructure, but can you talk about what your outlook is for broadband connectivity and multi-market, and whether they can all grow on a sequential basis in the Q2 too? I have a follow-up, please.

Speaker #5: Thank you, Carl.

Speaker #11: Our next question comes from Quinn Bolton with Needham & Co. Please proceed with your question.

Speaker #13: Hey, guys. Let me offer my congratulations on the nice results in Outlook. Kishore, I guess I wanted to follow up on Tim's question earlier about just the breadth of the growth in the infrastructure business and Q1.

Speaker #13: Was it predominantly from the optical DSPs, or did you see good contribution from Panther, the wireless access products as well?

Steven Litchfield: Hey, Karl, Steve. Yeah, thanks for the question. Yeah, I think we mentioned earlier, all four end markets will be up. I do expect a lot of that growth to be from infrastructure, just seeing the inflection that we're seeing from particularly some of the data center products. Yeah, that is our expectation.

Speaker #5: Both. Quinn, I'll jump in here on this one. Look, so really across the board, I mean, we saw some really good growth from all of the products within the infrastructure segment.

Speaker #5: I would say from here, you start to see kind of data center really break out. I mean, the other product lines absolutely contribute. Kishore mentioned earlier about Panther.

Karl Ackerman: Got it. Okay. Just to follow up on Chris's earlier question, is much of your optical DSP growth coming from hyperscaler-owned designs and therefore you are qualifying with them directly? Or is your hyperscaler exposure predominantly through module vendors providing a merchant solution?

Speaker #5: Panther is going extremely well. Wireless infrastructure, which was pretty soft last year. Talked about the improvements. We expect to see more of that this year.

Speaker #5: I mean, those are probably the top three or four products there.

Speaker #12: Got it. Got it. And then I know sometimes gross margin takes a couple of quarters to reflect their product mix because you've got a flow product sitting in inventory.

Kishore Seendripu: Both.

Karl Ackerman: Got it. Thank you very much.

Kishore Seendripu: Thank you, Karl.

Speaker #12: But you had, I think, a 30-ish percent increase in infrastructure in the quarter, maybe a 25% decrease in broadband quarter on quarter. I would have thought that would have been a nice tailwind for you. Gross margins were relatively flat.

Operator: Our next question comes from Quinn Bolton with Needham & Company. Please proceed with your question.

Quinn Bolton: Hey, guys. Let me offer my congratulations on the nice results and outlook. Kishore, I guess I wanted to follow up on Tim's question earlier about just the breadth of the growth in the infrastructure business in Q1. Was it predominantly from the optical DSPs, or did you see good contribution from Panther, the wireless access products as well?

Speaker #12: So just wondering, was there anything that sort of held back gross margin given the mix shift? Or do you think it's just sort of a timing issue?

Speaker #12: Obviously, the go forward look and the mix to infrastructure sounds like it's a nice tailwind to gross margin just trying to think when we might start to see it show up in the income statement.

Steven Litchfield: Quinn, I'll jump in here on this one. Look, really across the board, we saw some really good growth from all of the products within the infrastructure segment. I would say from here, you start to see data center really break out. The other product lines absolutely contribute. Kishore mentioned earlier about Panther. Panther is going extremely well. Wireless infrastructure, which was pretty soft last year. We talked about the improvements. We expect to see more of that this year. Those are probably the top three or four products there.

Speaker #12: Thanks, Steve.

Speaker #5: Yep. Yep. Certainly. Yeah. No problem, Quinn. Yeah. Look, I mean, we came in more like right at our guidance—what we had talked about. The mix is definitely continuing to improve.

Speaker #5: I mentioned a little earlier in a separate question about just input cost. I think we're just trying to be cautious as we look forward.

Speaker #5: But I just as you stated, yes, I do believe it's a tailwind. Especially as you move into 800 gig, 1.6T, all of those have higher gross margins.

Speaker #5: So we will certainly continue to see nice benefits on the gross margin side as infrastructure gets to be a larger percentage of our business.

Quinn Bolton: Got it. I know sometimes gross margin takes a couple of quarters to reflect your product mix because you've got a flow product sitting in inventory. You had, I think, 30-ish% increase in infrastructure in the quarter, maybe a 25% decrease in broadband quarter on quarter. I would have thought that would have been a nice tailwind for you. Gross margins were relatively flat. Just wondering, was there anything that sort of held back gross margin given the mix shift, or do you think it's just sort of a timing issue? Obviously, the go forward look and the mix of infrastructure sounds like it's a nice tailwind to gross margins. Just trying to think when we might start to see it show up in the income statement. Thanks, Steve.

Speaker #12: Great. Thank you. Congrats again.

Speaker #5: Thanks, Quinn.

Speaker #11: Our next question comes from Suji De Silva with Roth Capital Partners. Please proceed with your question.

Speaker #12: Hi, Kishore. e. Hi, Steve. Congratulations on the progress here. You talked about two Qs, some of the optical stepping up here. Are the programs all commencing ramp, or are there other programs phasing in and starting in 3Q, 4Q?

Speaker #12: Just to give us a set of layers across the year or really, are we all in ramp for all of the key programs? Already?

Speaker #5: Hi, Suji. There are different product cycles with different ramps. And they're all kicking in now. And there'll be some more that'll catch up later in the end of the year.

Steven Litchfield: Yep, certainly. Yeah, no problem, Quinn. Yeah, look, we came in more like right at our guidance, what we had talked about. The mix is definitely continuing to improve. I mentioned a little early in a separate question about just input cost. I think we're just trying to be cautious as we look forward. Just as you stated, yes, I do believe it's a tailwind, especially as you move into 800G, 1.6T, all of those have higher gross margins. We will certainly continue to see nice benefits on the gross margin side as infrastructure gets to be a larger percentage of our business.

Speaker #5: So, it really took a while for them all to start deploying with interop calls and everything complete. So now we are seeing strength in each of these layerings based on the bookings we have.

Speaker #12: Okay. That's helpful, Carl. Thank you, Kishore. And then Kishore, you mentioned in the prepared markets, I believe I heard wireless infrastructure having playing a part in data center connectivity, maybe data center interconnect or somewhere along those lines.

Speaker #12: Can you help us understand that opportunity and how big that is? Is that a niche, or can that become a mainstream opportunity?

Quinn Bolton: Great. Thank you. Congrats again.

Steven Litchfield: Thanks, Quinn.

Speaker #5: Could you repeat that question, Suji?

Speaker #12: Oh, the wireless infrastructure. The connectivity helping backhaul for data center and so forth. Is that a niche application, or is that a growing application?

Operator: Our next question comes from Suji Desilva with Roth Capital Partners. Please proceed with your questions.

Suji Desilva: Hi, Kishore. Hi, Steve. Congratulations on the progress here. You talked about Q2, some of the optical stepping up here. Are the programs all commencing ramp or are the other programs phasing in and starting in Q3, Q4? Just to give us a set of layers across the year or really are we in ramp for all of the key programs already?

Speaker #5: Yes.

Speaker #12: Yep.

Speaker #5: There are many. If you look at the prepared remarks I talked about 5G access and transport, and you have seen a number of announcements, investments where there's a lot of AI at the edge and AI-enabled network infrastructure.

Speaker #5: So we see a lot of the telecom infrastructure people on the wireless now gathering some momentum about deployment increases, and especially that means that it changes the transport overhaul, backhaul stuff, as well as certain elements of the access will change as well.

Kishore Seendripu: Hi, Suji. There are different product cycles with different ramps, and they're all kicking in now, and there'll be some more that'll catch up later in the end of the year. It really took a while for them all to start deploying with the drop quals and everything complete. Now we are seeing strength, each of these layerings, based on the bookings we have.

Speaker #5: So this should all provide us tailwind on the wireless infrastructure. Now, the growth mechanisms in wireless infrastructure will the rates of ramps will never match those of the data centers.

Speaker #5: However, you now started seeing you saw the announcement between NVIDIA and Marvell and you're seeing now genuine interest to move towards AI in the DU side of the network on the edge.

Suji Desilva: Okay. That's helpful color. Thank you, Kishore. Kishore, you mentioned in the prepared remarks, I believe I heard wireless infrastructure playing a part in data center connectivity, maybe data center interconnect or somewhere along those lines. Can you help us understand that opportunity and how big that is? Is that a niche or can that become a mainstream opportunity?

Speaker #5: In the wireless side as well. So we should definitely benefit as being one of the top two players in the wireless infrastructure space.

Kishore Seendripu: Could you repeat that question, Suji?

Suji Desilva: Oh, the wireless infrastructure, the connectivity helping backhaul for data center and so forth. Is that a niche application or is that?

Speaker #12: Okay. Very helpful, Kishore. Thanks.

Kishore Seendripu: Yeah

Suji Desilva: A growing application? Yep.

Kishore Seendripu: If you look at the prepared remarks, I talked about 5G access and transport, and you have seen a number of announcement investments where there's a lot of AI at the edge and AI-enabled network infrastructure. We see a lot of the telecom infrastructure people in the wireless now gathering some momentum about deployment increases, and especially that means that it changes the transport overhaul, backhaul stuff, as well as certain elements of the access will change as well. This should all provide us a tailwind on the wireless infrastructure. Now, the growth mechanisms in wireless infrastructure, the rates of ramps will never match those of the data centers.

Speaker #5: Operator, do we have one more question?

Speaker #11: Yes. Our next question comes from Tori Sandberg with Steeple. Please proceed with your question.

Speaker #13: Yeah, thank you. Just two quick follow-ups, especially on your new products. So, Kishore, first of all on Annapurna—obviously, this starts with 1.6T, but I'm just wondering if you could talk a bit about next-generation positioning there.

Speaker #13: Are you going to go after all the standards? Obviously, there's Ethernet standards. There's UA-Link. Are you going to participate perhaps also with some NVLink Fusion protocols?

Kishore Seendripu: However, you have now started seeing, you saw the announcement between Nvidia and Marvell, and you're seeing now genuine interest to move towards AI in the DU side of the network, on the edge in the wireless side as well. We should definitely benefit as being one of the top two players in the wireless infrastructure space.

Speaker #13: Just trying to understand exactly where you're trying to intersect the market with Annapurna. Especially on the retail.

Speaker #5: So especially, I know there's a lot of hoopla about AECs because of the success of one very successful company on AECs. But if you look at the market size opportunity for a silicon player, the AEC, the retimer market, electrical for AI scale-up inside the compute server is humongous.

Suji Desilva: Okay. Very helpful, Kishore. Thanks.

Speaker #5: At the speeds increase. So you're going to see a lot of retimers. Currently, our retimer offering is Ethernet-based, naturally. However, the fundamental physics and the challenges of doing a very, very demanding 5 for the electrical retimer application is done now.

Kishore Seendripu: Operator, do we have one more question?

Operator: Yes. Our next question comes from Tore Svanberg with Stifel. Please proceed with your question.

Speaker #5: So with regard to adding the various standards, that's just an interface game. Now, you can imagine there's also lends itself to other chiplet sort of stories and things like that.

Tore Svanberg: Yeah, thank you. Just two quick follow-ups, especially on your new products. Kishore, first on Annapurna. Obviously, this starts with 1.6T. I'm just wondering if you could talk a bit about MaxLinear's positioning there. Are you going to go after all the standards? Obviously, there's Ethernet standards, there's UALink. Are you going to participate perhaps also with some NVLink fusion protocols? Just trying to understand exactly where you're trying to intersect the market with Annapurna, especially on the retimer.

Speaker #5: There's a large so we're laying the framework and the groundwork of building a platform from which we'll have the optionality to chase where go with the SAM and the TAM goes.

Speaker #5: So at this point, we are in the electrical retimer market for Ethernet-based applications.

Speaker #13: That's very helpful. And on Washington, I mean, I assume that obviously gets sold with either Keystone or Rushmore. But are you seeing designs as well where your TIAs are perhaps participating on other people's DSP platforms?

Kishore Seendripu: Especially, I know there's a lot of hoopla about AECs because of success of one very successful company on AECs. If you look at the market size opportunity for a silicon player, the AEC, the retimer market electrical for AI scale-up inside the compute server is humongous as the speeds increase. You're going to see a lot of retimers. Currently, our retimer offering is Ethernet-based naturally. However, the fundamental physics and the challenges of doing a very demanding PHY for the electrical retimer application is done now. With regard to adding the various standards, that's just an interface game. Now you can imagine this also lends itself to other chiplet sort of stories and things like that.

Speaker #5: Right now, our Rushmore and Washington are sampling, right? Customers are using them, and they're very, very excited about the performance. But honestly, I mean, the TIA is beyond the TIA for Rushmore, right?

Speaker #5: If you think of an LPO strategy, the TIA is the fundamental block. If you think about LRO strategy, the TIA is the fundamental block.

Speaker #5: And MAXLINEAR is very well known for his great RF analog skills. So the CPO markets, if they're going to be barebones, then the TIA and drivers are a natural fit.

Speaker #5: If they go more sophisticated on the half DSB-based one, we already have the platform offering. But the real question comes as you go towards XPO, CPOs, and the various manifestations of it.

Kishore Seendripu: We're laying the framework and the groundwork of building a platform from which we'll have the optionality to chase where the SAM and the TAM goes. At this point, we are in the electrical retimer market for Ethernet-based application.

Speaker #5: So the full offering is super important. So Washington is the first step in the direction of a fundamental platform that will have multiple derivatives and incarnations.

Speaker #13: It makes a lot of sense. Thank you.

Tore Svanberg: That's very helpful. On Washington, I assume that obviously gets sold with either Keystone or Rushmore. Are you seeing designs as well where your TIAs are perhaps participating on other people's DSP platforms?

Speaker #5: Yep.

Speaker #11: Our next question comes from Tim Savage with Northland Capital Markets. Please proceed with your question.

Speaker #12: Thanks. Quick follow-up for me as well. And that's on the hyperscale wind for PON, which sounds like the data center out of management stuff.

Kishore Seendripu: Right now, our Rushmore and Washington are sampling, right? Customers are using them, but they're very excited about the performance. Honestly, the TIA is beyond the TIA for Rushmore, right? If you think of an LPO strategy, the TIA is a fundamental block. If you think about LRO strategy, the TIA is a fundamental block, and MaxLinear is very well known for its great RF analog skills. The CPO markets, if they're going to be bare bones, then the TIA and driver is a natural fit. If they go more sophisticated on the half DSP based one, we already have the platform offering. The real question comes as you go towards CPO, CPOs, and the various manifestations of it. The full offering is super important. Washington is the first step in the direction of a fundamental platform that will have multiple derivatives and incarnations.

Speaker #12: I guess, can you talk a little bit more about the timing there and how significant this opportunity? When would you expect this design wind to ramp and could it be a needle mover of some sort?

Speaker #12: Thanks.

Speaker #5: So, absolutely. We just secured the win, so we expect the ramp. There is a lot of qualification that goes through it, so sometime in 2027, it ramps—starts ramping.

Speaker #5: But how big that can be today, I think this is one of the first of its kind—sort of what I call a very, very interesting development—where the data centers are seeing the value of a dedicated, reliable link to control the entire data center network, right?

Tore Svanberg: Makes a lot of sense. Thank you.

Kishore Seendripu: Yep.

Speaker #5: So, we expect this TAM to expand to over hundreds of millions of dollars. But currently, our expectation is that, at our revenues, it's going to be quite a bit of a needle mover, even in the next year itself, in the second half, on our run-rate basis.

Operator: Our next question comes from Tim Savageaux with Northland Capital Markets. Please proceed with your question.

Tim Savageaux: Thanks. Quick follow-up from me as well, that's on the hyperscale win for PON, which sounds like the data center out-of-band management stuff is. I guess, can you talk a little bit more about the timing there and how significant this opportunity? When would you expect this design win to ramp, and could it be a needle mover of some sort? Thanks.

Speaker #12: Thanks.

Speaker #11: Our next question comes from Richard Shannon with Craig-Hallum Capital Markets. Please proceed with your question.

Speaker #12: Hi, guys. Just have one follow-up for me here, and that's to dig in a little bit on the TSP side. I want to get a sense of how big the other applications are outside of what most people assume—and I certainly do—the duplex optical DSP being a big part of it.

Kishore Seendripu: Absolutely. We just secured the win, so we expect the ramp. It is a lot of qualification that goes through it. Sometime in 2027, it starts ramping. How big that can be today, I think, this is one of the first of its kind, sort of, what they call a very interesting development where the data centers are seeing the value of a dedicated, reliable link to control the entire data center network, right? We expect this TAM to expand to over $ hundreds of millions. Currently, our expectation that at our revenues, it's going to be quite a bit of needle mover even in the next year itself, in H2 on a run rate basis.

Speaker #12: But how could the rest of that business—the LOR, LPO, CPO, AEC, retimer, etc.—how big can that be? In a year or two, can that be 10 or even 20 percent of that total portfolio?

Speaker #12: Any sense of that would be great. Thank you.

Speaker #5: So it's still in the early innings of how this whole market is going to play out, whether it's CPOs or whether it is I know people get excited, but still, I think we are three years or out away from determining that.

Speaker #5: But at this point, it's a very small share of the market from a units point of view. Okay? From a silicon units point of view.

Speaker #5: So I don't expect it to be a huge part of our revenues. But from a TAM-wise, I would rate the optical transceiver DSPs to be the number one TAM, substantially overwhelming the rest.

Speaker #5: Second would be electrical retimers when that happens. And the third would be AECs. And AECs, as we go, are a story because there is a certain level of point-in-time application nature to the AEC.

Tim Savageaux: Thanks.

Operator: Our next question comes from Richard Shannon with Craig-Hallum Capital Group. Please proceed with your question.

Speaker #5: And that itself will evolve. So I would rank them in that order. But at this point, it's going to be massively overwhelmed by revenues in the optical transceiver PAM for DSP.

Richard Shannon: Hi, guys. Just have one follow-up from me here, and that's to dig in a little bit on the DSP side here. Want to get a sense of how big the other applications outside of what most people assume, and I certainly do, the duplex optical DSP being a big part of it. How could the rest of that business, that LRO, LPO, CPO, AEC, retimer, et cetera, how big can that be in a year or two? Can that be 10% or even 20% of that total portfolio? Any sense of that would be great. Thank you.

Speaker #12: Okay, that's kind of what I thought. Just wanted to hear that. Thanks, that's all from me. Thanks, Kishore.

Speaker #5: Yep. Thank you.

Speaker #12: Thanks, Richard.

Speaker #11: We have reached the end of our question and answer session, and there are no further questions at this time. I would now like to turn the floor back over to Leslie Green for closing comments.

Kishore Seendripu: We are still in the early innings of how this whole market is going to play out, whether it's CPOs or whether it is. I know people get excited, but still, I think we are 3 years or more away from determining that. At this point, it's a very small share of the market from a units point of view, okay? From a silicon units point of view. I don't expect it to be a huge part of our revenues, but from a TAM-wise, I would rate the optical transceiver DSPs to be the number one TAM, substantially overwhelming the rest. Second would be electrical retimers, when that happens, and the third would be AECs. AEC is a see as we go story because there is a certain level of point in time application nature to the AEC, and that itself will evolve.

Speaker #1: Thank you all. This quarter, we will be presenting at several financial conferences. And the details will be posted on our investor relations page. Thank you all for joining us today.

Kishore Seendripu: We are still in the early innings of how this whole market is going to play out, whether it's CPOs or whether it is. I know people get excited, but still, I think we are three years or more away from determining that. At this point, it's a very small share of the market from a units point of view, okay? From a silicon units point of view. I don't expect it to be a huge part of our revenues, but from a TAM-wise, I would rate the optical transceiver DSPs to be the number one TAM, substantially overwhelming the rest. Second would be electrical retimers, when that happens, and the third would be AECs. AEC is a see as we go story because there is a certain level of point in time application nature to the AEC, and that itself will evolve.

Speaker #1: And we look forward to speaking with you again soon.

Kishore Seendripu: I would rank them in that order, but at this point, it's going to be massively overwhelmed by revenues in the optical transceiver PAM4 DSP.

Richard Shannon: Okay. That's kind of what I thought. Just wanted to hear that. Thanks. All from me. Thanks, Kishore.

Kishore Seendripu: Yep. Thank you.

Steven Litchfield: Thanks, Richard.

Operator: We have reached the end of our question and answer session, at which there are no further questions at this time. I would now like to turn the floor back over to Leslie Green for closing comments.

Leslie Green: Thank you all. This quarter, we will be presenting at several financial conferences, and the details will be posted on our investor relations page. Thank you all for joining us today, and we look forward to speaking with you again soon.

Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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