MaxLinear, Inc. (MXL) Q3 2026 Earnings Call Transcript

Operator: Greetings, and welcome to the MaxLinear Q3 26 Earnings Conference Call. At this time, 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 your host, Leslie Green of Investor Relations.

Leslie Green: Thank you.

Operator: You may begin.

Leslie Green: Thank you, Shimali. Good afternoon, everyone, and thank you for joining on today's conference call to discuss MaxLinear's third quarter 26 Financial Results. Today's call is being hosted by Dr. Kishore Seendripu, CEO and Steven G. Litchfield, Chief Financial Officer and Chief Corporate Strategy Officer. After our prepared comments, we will take your questions. Our comments today include forward looking statements within the meaning of applicable securities laws, including statements regarding our guidance for the fourth quarter of 26, 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. 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 market share gains across our target markets new products including the timing of production and launches of such products demand for the adoption of certain technologies and our total addressable market. These forward looking statements involve substantial risks and uncertainties including risks outlined in the Risk Factors section of our recent SEC filings, including our most recent annual report on Form 10-Ks and our Form 10 Q for the quarter ended 09/30/2026, 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 third quarter 26 earnings release is available in the Investor Relations section of our website at maxlinear.com. 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 the GAAP and non GAAP basis. We encourage investors to review the detailed reconciliation of our GAAP and 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. Lastly, this call is also being webcast, and the replay will be available on our for 2 weeks. And now let me turn the call over to Kishore Seendripu, CEO of MaxLinear. Kishore?

Kishore Seendripu: Thank you, Leslie, and good afternoon, everyone. As the ongoing AI infrastructure build out momentum continues and as AI data center clusters continue to scale to unprecedented size and bandwidth requirements, we believe MaxLinear is emerging as a key enabler of next generation connectivity technologies. Demand for our optical data center connectivity and infrastructure solutions continues to strengthen, and we believe MaxLinear is in the early innings of a multiyear AI driven growth cycle. Against this backdrop, our AI data center business continues to outperform our expectations. In Q3, overall revenue grew 72% year on year, driven by accelerating adoption of our optical PAM4 products expanding customer engagements and strong execution across our infrastructure portfolio. Infrastructure as a category grew 210% year on year and which is now larger than the rest of our revenue categories combined. Reflecting this momentum, we are raising our 26 optical data server revenue outlook to $250 million to $270 million. With strong visibility in bookings extending beyond 2027, we expect another significant step up in revenue next year. Keystone, our 5 nanometer CMOS 100 gigabit per lean PAM 4 SerDes family, continues to ramp rapidly in high volume production across multiple hyperscalers. Its industry leading power efficiency and performance position MaxLinear at the center of today's 800 gig optical infrastructure deployments. Looking ahead, we are seeing accelerating customer activity around Rushmore based 200 gigabit per lane PAM 4 1.6 terabit architectures where qualification programs are advancing toward production deployments in 2027. Rushmore is building on Keystone's foundational success and is also to become a major multiyear growth driver. Big Sky, our family of next generation 400 gigabit per lane, 3.2 terabit optical and electrical PAM for interconnect technologies. Will further catalyze growth as network. As data center networks speeds continue to accelerate beyond 200 gigabit per lane. Beyond PAM4 SerDes optics, we continue to broaden our AI infrastructure footprint across optical and electrical interconnects. Re timers, control plane connectivity, telemetry, and power management, This strong expansion of content inside the AI data center stack positions MaxLinear to participate across multiple layers of future AI data center architectures. Already, Anapurna, our 1.6 terabit electrical interconnect product family, addresses 1.6-terabit electrical cable and onboard retimer applications for AI scale up. Washington, our 200 gigabit per lane TIA not only supports PAM4 DSP based optics, but also non DSP based linear pluggable consisting of LRO, LPO, NPO, and CPO solutions. We expect initial Washington and Anapurna revenues in 2027, followed by a stronger volume ramp in 2028. We are also excited about our AI rack Commander portfolio consisting of USB, PCIe, UART, connectivity bridges used for telemetry, power management, and protection solutions for rack scale AI infrastructure. Rack Commander expands our role beyond data movement and into the control plane of the AI data center. Customers require advanced telemetry monitoring connectivity and power control capabilities to maximize performance and efficiency, which is critical for infrastructure management. We believe this represents a significant long-term growth opportunity while our strategic footprint. Additionally, our XGS PON hyper data center design win which serves as the control plane connectivity network across multiple data centers has completed qualification. Supported by secured backlog, we expect first deployments of this inter data center control plane solution to start in 2027. Separately, Panther, our storage accelerator platform, continues to gain momentum as customers seek more efficient AI infrastructure. By significantly increasing effective storage utilization and unlocking kV cache capacity for AgenTeq AI applications Panther enables customers to support larger AI inference workloads without increasing storage infrastructure spending. We expect Panther revenue to roughly double this year with potential for another meaningful increase in 2027. While AI data center remains our primary growth driver, we expect edge AI driven upgrades to also drive growth in 2027 and 2028, for our wireless infrastructure and broadband access and connectivity solutions. These include Sierra single chip 5G RAN remote radio unit solution, Our millimeter wave microwave backhaul RF and modem SOCs, and XGS PON fiber broadband home gateways. Both broadband and connectivity categories delivered sequential revenue growth in Q3, driven by large scale deployments of FiberPON and Wi-Fi 7 gateways at major Tier 1 service providers in North America and Europe. In closing, accelerating hyperscale deployments increasing optical connectivity content, new product ramps, and broader party across the AI infrastructure stack, give us confidence that MaxLinear is still in the early stages of a significant growth cycle. Our strategy is focused on strengthening our in high-speed data center connectivity, expanding into adjacent infrastructure markets, and increasing our content share and strategic relevance with hyperscaler customers. With strong customer momentum, great backlog visibility, a differentiated technology portfolio, we believe MaxLinear is well positioned to deliver sustained growth and long-term shareholder value. With that, let me turn the call over to Steven G. Litchfield, our Chief Financial Officer and chief corporate strategy officer. Steven?

Steven G. Litchfield: Thanks, Kishore. Total revenue for the third quarter was $218.1 million up 29% from $168.8 million in the previous quarter and up 72%, $126.5 million in the third quarter of 25. Infrastructure revenue for the third quarter of 26 grew to approximately $125 million Broadband revenue grew to approximately $53 million Connectivity revenue was approximately $25 million. Our industrial and multimarket revenue was approximately $15 million. Dollars GAAP and non GAAP gross margin for the third quarter were 58.7%, 60% of revenue. The delta between GAAP and non GAAP gross margin in the third quarter was primarily driven by $2.5 million of acquisition related intangible asset amortization. Third quarter GAAP operating expenses were $97.8 million and non GAAP operating expenses were $66.5 million The delta between GAAP and non-GAAP, between GAAP and non GAAP operating expenses were primarily due to stock based compensation and performance based equity accruals of $28.8 million combined and acquisition related costs and other costs of $2.3 million With the strong growth in our business coupled with continued spending discipline, we have delivered significant improvement in our GAAP and non GAAP operating margin over the past 12 months. GAAP operating margin for Q3 26 was 13.9% and non GAAP operating margin in Q3 was 29.5% of net revenue. GAAP and non GAAP interest and other expense during the quarter was $2.1 million and $2 million GAAP diluted EPS for Q3 26 was $0.03 per share. Non GAAP diluted EPS was $0.62 per share. In Q3, net cash flow was used in operating activities was approximately $13.6 million We exited Q3 of 26 with approximately $109.9 million in cash, cash equivalents and restricted cash. This included a substantial prepayment for wafers supporting rising demand for our data center products for which we have committed order backlog throughout 2027. Our day sales outstanding in Q3 was approximately 31 days versus 28 days in the previous quarter, Our days of inventory was down in the quarter from 1 hundred and 23 days to 111 days. Finally, today, announced that we have amended our existing credit agreement to increase the amounts available under the revolving credit facility by $70 million to $200 million. With this facility, our total available liquidity is much improved giving us additional flexibility to address further customer demand and other growth opportunities. This concludes the discussion for our Q3 financial results. With that, let's turn to our guidance for Q4 of 26. We currently expect revenue in the fourth quarter of 26 to be between $240 million and $260 million Looking at Q4 by end market, we expect strong growth in infrastructure driven by data center optical interconnects, We expect broadband and connectivity end markets to be down seasonally while industrial multimarket end market is expected to be up. We expect fourth quarter GAAP gross margin to be approximately 58% to 61% and non GAAP gross margin to be in the range of 59% to 62% of revenue. We expect Q4 26 GAAP operating expenses to be in the range of $96 million to $101 million We expect Q4 26 non GAAP operating expenses to be in the range of $65 million to $70 million We expect both our Q4 GAAP and non GAAP interest and other expense to be in the range of approximately $3.5 million to $4.3 million We expect a 1.3 I am sorry, $1.5 million tax benefit on a GAAP basis and non GAAP tax provision of approximately $1.5 million. We expect our Q4 GAAP and non GAAP diluted share count to be approximately 99.7 million each. In summary, our quarterly performance highlights the continued strength of our optical product portfolio and the accelerating momentum across several growth drivers within our infrastructure business. The progress and innovation we have achieved in this area have been transformative, and we believe we remain in the early innings of a multiyear growth cycle marked by expanding revenue and increasing operating leverage. We are excited about the opportunities ahead and remain confident in our ability to deliver sustainable, long-term value for shareholders. With that, I would like to open up the call for questions. Operator?

Operator: Thank you. It may be necessary to pick up the handset before pressing the star keys. 1 moment please while we poll for questions. And our first question comes from the line of Tore Svanberg with Stifel. Please proceed with your question.

Tore Svanberg: Thank you, Kishore, Steven. Congrats on the strong results. I guess my first question is on the PAM4 DSP side. You a number there for CALMiD26. I mean based on my rough math, think that is now it would be running at about $100 million a quarter run rate. As we think about 27, is $400 million-plus a good number? And how should we think about the mix next year between 800-gig and 1.6T? Thank you.

Steven G. Litchfield: Hey, Tore. This is Steven. So I do not think we are planning to give guidance in the out-year today, but certainly, I do believe you have seen us with some very strong growth coming from our optical DSP business. I think we are actually doing a really great job on the market share standpoint. And so I think as you look into 2027, you are starting to see the momentum pick up, and I would expect to see us outgrow the market in 2027.

Tore Svanberg: Very good. Thank you for that. And then as far as customer diversification, I noticed you did not have any 10% customers this quarter. And had a question specifically on your optical DSP business. How should we think about the composition there by amount of customers, module makers, geography, any, any color you could share with us on, you know, how diversified that business is becoming in real time? Thank you.

Kishore Seendripu: Thank you, Tore. I think when you go to the first order of diversification for us, it is really exciting that now we are transitioning from 800 gig fully established as a growth vehicle and market share gains. And we are in strong qual cycles on 1.6 terabit of Rushmore products. Along with not just only in optical products, but we have a strong call cycle on electrical products as well at the 1.6 terabit speeds. So that is the first layer of diversification. We will-- we expect in the near to. near-term, Rushmore to start picking up revenue in 2027. And you can look to 2028 and 2029, it is going to be a massive growth driver for us. In addition to key stone at 800-gig that you. is still growing for us as well. So that is the first order of diversification the second part is that our revenues are quite broad based. it is across all the major module makers. And we have a growing set of module makers who are also engaged in 1.6 terabit. Beyond our 800 gig product lines. And the same applies on the data centers as well. Our penetration of, you know, geographically in Asia and The US is increasingly now-- the momentum on the designing cycles is starting to shift towards 1.6 terabit. I think The US is in a more advanced phase of 1.6 terabit deployments. We naturally expect The US to become an increasingly strong driver or our value proposition in the optical module space as well. Right. I will go back in line. Thank you.

Operator: Thank you. Our next question comes from the line of Ananda Baruah with Loop Capital Markets. Please proceed with your question.

Ananda Baruah: Hey. Thanks. Thanks, guys, for taking the question, and congrats on the continued good progress. it is cool to see. I guess 2, if I could. Kishore, just sort of sticking there on the hyperscale diversification, and maybe just part of a-- partly clarification as well. How much you said in the past 1.6T production ships is really a mid-27 dynamic. How much of the business between now and then in 800-gig if any, is from US based hyperscalers? And just even anecdotal, then I have a quick follow-up. Thanks.

Kishore Seendripu: So, Ananda, we have never broken down that revenue in that sort of. Never do that. However, it is pretty broad based. Suffice it to say, as 1.6 terabit revenue start ramping, the initial revenue is actually in early 27 and a stronger ramp in the second half. The US data centers will start becoming very important in a-- both on a static snapshot basis and also from a trajectory basis. So. Because The US is the 1 that is going to head off 1.6 terabit, a much earlier cycle than the Chinese counterpart. Right? So I think that what we take extreme satisfaction and joy in is that 1.6 terabit traction is quite across the board substantially. And The US data centers, they are just beginning to start ramping 1.6 terabyte outside of an NVIDIA and a Google in that order. Right? So and that supply diversity across the various speed nodes across 800 gig and 1.6 terabit on the supply line, including the fabrication process, really puts us in a unique position where within-- we are not competing across product lines for the same technology node. So in a sense, we should be able to win this race in terms of making us a major provider of 1.6T.

Ananda Baruah: that is good context. I appreciate it. that is helpful. And then the quick follow-up is you mentioned NPO, CPO. So is there a useful way for us to think about your SerDes participation in NPO, CPO? If even just from a paradigm approach. How involved do you expect to be? In what ways do you expect to be? The question's been coming up, and it. It will be relevant 12 months from now. Thanks.

Kishore Seendripu: Okay. If you look forward, you see a future where all the alphabets POs will be in coexistence with the PAM 4 SerDes based optical pluggables. Right? And we have seen that the that shoreline density and the power consumption scenarios will drive a certain volume of the speed connections into the optical based what I call, incarnations. Right? Be it an NPO, or an LRO. Right? So if you look at the LRO or DSP, NASH lends itself into a full blown participation. And we believe that in The US, LRO is a real option at the 200 gig per lane. And I believe it will be a major option in the 400 gig per lane as well. that is my particular view. And then if you look at CPU has gotten delayed because the challenge of the optics in a hybridized co pack configuration is a very huge problem. And therefore, I think NPO supply is what we were thinking about as CPO. NPO, the advantages of maintenance modularity, diversity of suppliers for the product, as against being locked to the ASIC players on the switch side or the GPU side. So I think it is a natural place where the ecosystem goes. So I think NPO will be big. How big? I cannot speak, but I would say on a snapshot basis in 2030, you should expect 60% to 70% pluggable, 20% NPO, and 10% all various forms of it. that is my personal view. Not a market view. But I think we will be a major player in NPO and LROs which will be the natural ideally suited for low power applications versus an LPO in the future as the speeds increase. Okay? that is great context. Thank you. Yep.

Operator: Thank you. Our next question comes from the line of Cody Acree with Stonex Financial. You may proceed with your question.

Analyst: Hey, guys. Congrats on the progress. it is been a great performance. Kishore, maybe can you talk about your visibility into 2027? If you are not going to talk yet about the scale of your optical ramp Can you maybe just talk about your bookings or your lead time visibility for the next few quarters?

Kishore Seendripu: Steven, you wanna take a shot at it?

Steven G. Litchfield: Sure. Sure. Yeah, Cody, I Look, we have great visibility as I am sure you have heard from others in the industry. You know, we are booking products throughout 2027 into 2028. You know, lead times for optical products are, you know, 26, 28 weeks. But customers are certainly coming in and placing orders out much further than that just kind of given they wanna secure supply. You have seen a lot of our you know, upsides that we have delivered. I think you will continue to see more of that growth in 27. And, Steven, maybe just continue with you. Can you just bridge your next gross margin thoughts between mix pricing, manufacturing costs and product transition over the next couple of quarters? Yeah. Sure. Gross margin, as you know, we have been making some nice progress, kind of moved up from 58. We delivered on 60% this quarter. Our guidance is at 60.5. So I think we are really seeing some nice progress, kind of despite some of the cost increases that, we are seeing across our entire ecosystem here, I guess. Some of that we have been able to pass along to the customer. And I think our cost structure is actually just very good. So as the mix continues toward more infrastructure products, I think you will see our gross margin continue to trend up. Excellent. Thank you, guys. Congrats. Thanks, Cody.

Operator: Thank you. Our next question comes from the line of Christopher Rolland with Susquehanna. Please proceed with your question.

Christopher Rolland: Regarding DSP, last cycle, maybe the 400, 800 cycle, you know, DSP was much more widely available. Transceivers had shorter lead times. And people could wait for land power a shell to be built before, you know, making what was kind of a last minute order on optical. Do you guys view that as different now with longer lead times? And does this kind of perhaps create an effect where people are ordering ahead more significantly, perhaps even over-ordering to, you know, they cannot get their AI data center up without these transceivers. So does this become perhaps the golden screw that people are willing to purchase more of than they might need just for the initial deployment?

Kishore Seendripu: So, Christopher, I do not think so at all. Not at all, actually. You have to keep this in mind that, you know, even in the supply chain, nobody's signing real long term agreements. So you have strict discipline on lead time. there is a lot of manufacturing shortage. So it is-- it is really naturally organizing the entire supply chain into very disciplined on. You will only get what you need now. Sort of behavior. So I do not think there is any double ordering. And then you get back to our DS world, we are the only pure play DSP provider in the optical pluggable. Wafer capacities are allocated by companies by the major foundry. And, if you are in 5 nanometer, for example, you. You are welcome to choose how you distribute your silicon between switch, pluggables, GPUs, TPUs, and so on and so forth. Right? So every company gets to prioritize what is in their best value interest. So I would say that is not the case at all, number 1. Number 2, is that, you know, even to place over ordering, the data center guys are very, very disciplined about creating pure chains. What I mean by that is the optics, the DSP, for a particular quality in a data center is very unique so that they do not cross corrupt the supply chain. So I think it is golden. it is not a screw, but it is a bolt. You know? So I will. there is a bolt there that is really, really fascinating The cantilever bridge quite well here. So that is for those in the San Francisco Bay Area. But, yeah, looking pretty good.

Christopher Rolland: Excellent. Maybe a follow-up there and a second question. I guess, first of all, obviously, you guys have some unique 4-nanometer DSP that others do not. Can you talk about how you see constraints in the optical market playing out? Is it Is it DSP? Is it other parts lasers, etcetera? If you could talk about your place there? And then secondly, DSP in the world of CPO, some believe it is less meaningful. Would like your take, Kishore, as a as a technologist.

Kishore Seendripu: Okay. Christopher, there is a lot of questions out there. That you proposed you posed here to me. I will take the first 1. Which is basically related to supply. I think the optic supply is easing. We are really constrained by foundries on the DSP supply. And the data center build out is really accelerating. So if you sit here and talk, if the demand. You know, people talk about TAM units for optical no matter what flavors. Is in the order of 120 million units. Now they talk about 2027, 2028, maybe 200 million units. So I am not keeping count anymore. Right? So, however, the fat capacity is not coming online. Those are these are huge multiyear efforts. And so there is really, really a fab capacity shortage, I would say. And so the DSP supply is a pretty strong supply constraint. And we are really being, you know, And the opportunity on the CPO stuff really is a scale up side, which is a greenfield opportunity for us. Well, I do believe the NPO is going to be the more bigger success driver than a CPO. And in a c p. In an NPU scenario too as well, the. As you go to higher speed longer term, there would be DSP required just like an LRO configuration on the. What you call a half DSP. Because we can all agree now that the LPUs are really, really a very small fraction point technology and they do not have legs for the future. Right? So we have product portfolio that spans TIAs. We have drivers and the also we have announced products along those various categories. So feel very, very well positioned whichever way the industry goes, and we will have a full portfolio. Awesome. Thank you, Kishore. Yes.

Operator: Thank you. Our next question comes from the line of Karl Ackerman with BNP Paribas. Please proceed with your question.

Karl Ackerman: Hi. This is Samuel Feldman on for Karl Ackerman. So first, based on your extended visibility into calendar 2020 can you provide any color on how we should think about the growth rate the relative growth rate between 800-gig and 1.6T? And should we expect 400 gig to grow through calendar 2017?

Steven G. Litchfield: So I will take that. I mean, with regard so this year, our optical growth is almost all 800 you know, in the first half. As we have stated, and Kishore mentioned earlier, 1.6T starts in 2027, but it will have a much bigger growth year in 2028 You know, what is the mix in 2028? I mean, I think it is substantially 1.6. Maybe you will see 800 kind trailing off, but potentially, it can sustain as well and up until probably 2029. So, I mean, we see you know, significant growth in 2027 as well as 2028 on both of those.

Karl Ackerman: Got it. Thank you.

Operator: Thank you. Our next question comes from the line of Quinn Bolton with Needham and Company. Please proceed with your question.

Quinn Bolton: Hey, guys. Congratulations on the results and DSP outlook. I guess, Steven, for you, it looks like the prepaid assets on the balance sheet increased by about $50 million the September quarter. I assume that, that is probably the large majority of that are your prepayments that you talked about. Given that it sounds like you are fairly well booked for calendar 2027 now in the DSP business, do you feel that prepayments and the wafers you secured support that 2027 backlog? Do you still have more work to do in the fourth quarter in terms of prepayments and securing wafers to meet the demand you are seeing for calendar 2027?

Steven G. Litchfield: Hey, Quinn. Yeah. So, I mean, we talked about this a little bit before. Similar to others. I mean the prepayments mostly on the wafer side. I mean, there is lots of other things going on out there. I mean, on the balance sheet is not just TSMC. there is other things on prepayments as well that we do not break out. As far as. I mean, I talked earlier about visibility in 2027. Yeah. I mean, backlog, as you would imagine, is very, very good in 2020 and into 2028. Prepaid. I mean, look. I expect prepaids to continue to go up from here. As, you know, our revenue projections continue to go up as well. So you know, I think that is part of the reason why we increased the revolver itself. You know, just to make sure that we can capture the. All of that upside capacity coming from increased market share that we have gained.

Quinn Bolton: Got it. Thanks. And then a follow-up. Steven, I think at some of the investor conferences over the past few months, you have estimated your DSP share currently maybe in the 5% to 7% range. Do you think you are at near the high end of that or potentially above that by the end of 26? Just based on the strong backlog you are seeing and increase in the DSP forecast this year?

Kishore Seendripu: You know? Hey, Quinn. This is Kishore. I think it is very hard to estimate share Yeah. Thank you. Yeah. I think it is very hard to estimate share given the demand on units as well. So if I am looking backward, then I think we are well above the number If I am looking forward, maybe we made more progress beyond that share percent but I do not know at what level we are. So can I say what we would look like 2 years from now? Sure. It should be in the teens for sure. Right? And, you know, so I think that is a very backward looking number. For. On a share percentage basis, on a backward looking TAM basis, you should be larger. But on a forward looking basis, very hard to estimate the numbers are moving all around. But suffice to say, we are gaining share every day. I think in a 12- to 24-month win. Window, we could be neck and neck with 1 of our 2 competitors. Right? that is the hope. that is the goal, and that is the momentum. Excellent. Thank you, Kishore.

Operator: Thank you. Our next question comes from the line of Timothy Savageaux with Northland Capital Markets. Please you may proceed with your question.

Timothy Savageaux: I will add my congrats, on the results and the outlook. Now I wanted to go to welcome. The kind of market growth market share type discussion and Steven you made a comment earlier in the call about outgrowing the market. And, you know, I think we may have a baseline there you know, Marvell talked about kind of the AI interconnect unit for them growing call it, 65% on a CAGR through 2030. it is coincidentally what MaxLinear is growing overall in 2026. But as we look at the optical DSP business, is it fair to use something like that in the as a baseline? And when you say you want to outgrow the market, mean, just based on your run rate, it seems like we should be thinking closer to a double here than anything else for 2027. But I just kind of wanted to bounce that reasoning off you.

Steven G. Litchfield: No, Timothy. I feel very confident we are outgrowing the market, which I think supportive of what you are asking. Yes.

Kishore Seendripu: And we cannot speak for Marvell's numbers.

Analyst: Okay.

Timothy Savageaux: Well, I will go and ask this 1 anyway then, which is I think your market share is like 6% here If you take those forecasts out to their conclusion, I mean, they are talking about, I do not know, a $15 billion optical DXP market in 2030. I mean, if you get into double digits before that, you should have a billion dollar business on your hand pretty quickly. Wanna bounce that 1 out to 2 and then that will be it for me.

Steven G. Litchfield: Jim, we cannot comment on that. Right? So Yeah. Yeah. But the numbers you are talking about, I mean, look. there is a lot of growth here. I mean, KeyShort commented earlier about the transceiver growth. I mean, people are talking 200 million units next year. I mean, so these numbers make a lot of sense as T Shores stated. It being up in the teens over the next couple of years, very achievable. I think we are doing a great job. I think you have seen that promise in 2026, but I would say it is just getting going. You are gonna continue to see through that in 2027-2028. Thanks very much.

Operator: Thank you. Our next question comes from the line of Joe Quatrochi with Wells Fargo. You may proceed with your question.

Joseph Quatrochi: Hi, guys. This is Travis Pullen on for Joe. Thanks for taking my question. So Steve, I just wanted to switch gears to broadband. You spoke with spoke of seeing some seasonal softness in 4Q 26. Just curious how we should think about this moving forward into the first half of 27 and the second half of 27 and just the overall broadband recovery in general? Thanks.

Steven G. Litchfield: Yeah. Thanks, Travis. Yeah. I mean, we actually feel pretty good. I mean, do see some seasonality in Q4 certainly, but as far as 2027 goes, I mean, you know, you are just as we had talked about previously with the telco spending, but then also our market share gains on the PON side, we do expect to see growth in 2027. So feel very good about that.

Joseph Quatrochi: Got it. Thank you. that is it for me.

Operator: Thank you. Our next question in queue is from the line of Tore Svanberg with Stifel. Please proceed with your question.

Tore Svanberg: Yes. Thank you. Now that the basic questions are out of the way, just had a few more specific follow ups. So Kishore, I think you said you expect 1.3 revenue already first half of next year. I think in the last quarter, I think you talked about maybe middle of the year. So what changed there? Is it the market that is accelerating? Earlier? Is it based on some new design wins? Any clarification there? And by the way, does that include DSP and TIA? Is it just DSP?

Kishore Seendripu: So, Tore, obviously, it is 3 months, and we do not know where it would be, but I think there is an initial design win that will start shipping in the first half. The exact amount of quantities is not clear, but it. it is meaningful in the sense that it sets up the second half very nicely. And also, second part also is correct what you asked. They are accelerating design call momentum going on. And somewhat, are bottlenecked by our own ability to support multiple call and we are all going through resource bottlenecks from that angle. So the. So that narrative is also about. Also accelerating on the call windows across the module space in. Into the data center cycles. Right? So I think that is what gives me a little more and then we also have a commitment both for DSP and TIA in these design wins. So it is not just our DSP alone. Obviously, we live in a world where we want to attach our own TIA to our own DSP for selfish reasons beyond just a great performance advantage and cost saving for our own customers in terms of power efficiency and the total BOM efficiency. Right? So I think all the 3 questions you asked are strong affirmative response.

Tore Svanberg: Very good. And last 1 is on pricing or content. So we are hearing as you go from 800-gig to 1.6T that maybe prices could be 2x. You are obviously going to be shipping more than the DSP with the TIA. So in your case, I guess, you know, you could potentially have more than 2x as the market goes from 800 gig to 1.6?

Kishore Seendripu: You are absolutely right. So if you just take this proverbial 2 x, historically, we never stopped when you when you change speeds. Right? But this time, it is ticking. Right? So the ASP on the DSP is more or less doubling, and then we have TIA that we did not add before. So all in all, we will we will be growing more than 2x on the ASP number. So the TIA is not just a TIA. Right? it is got smarts that really add what I call trajectory guide to our NPO strategy and our CPU and our LPO strategy and LRO strategy. So it is a. it is an all in 1 deal in the MaxLinear TIA world. Great color. Thank you. Yep.

Operator: Thank you. And our last question comes from the line of Cody Acree with Stonex Financial. Please proceed with your question.

Analyst: Hey guys, just a couple of follow ups as well. Maybe Kishore, can we go back to that comment you made about constrained ability to support more than 1 qual. Is this just wafers out of Samsung that you are talking about? Or is there. And what is the ability to address that so that you can get calls lined up a little faster?

Kishore Seendripu: Oh, so, you know, the calls has got nothing to do with wafers Right? it is. You. All the. You know, you have to line up let's say you have 10 module makers, and that is not unrealistic. And then all of the 10 want to go simultaneously get their modules ready to go to the data center qual. We will have to pick and choose. Right? Because at the end point, multiple module makers are targeting the same data centers as well. So that constrains us in terms of how we prioritize our own internal resources to get quality. So that was the contest I talked about. Right? These are pretty complicated. Even though it look. People simplify it and call it a pluggable, it is so sounds so trivial, but these are 1 of the most complex technologies that you know, chip people have ever developed over the last 20 to 30 years. And you ought to think about this in. Not just in terms of pluggable alone. You also have to think about the interoperability with the switch. The other 2, vendors of silicon and the preexisting 800 gig silicon as well. So not just 1.6 terabits. So it is pretty complicated. So we are constrained in how many we can activate at the same time. So, of course, you, sequence and prioritize them. that is the constraint I was referring to. Gotcha. Thank you for that clarification. And then just lastly, with Washington, can you talk about your expected attach rates to Rushmore and the opportunity for standalone as you get into 2027 and maybe looking into 2028? And then maybe the same thing with your AECs, can you talk about the mix of onboard versus cables for Annapurna? Okay. Good question. Would say, you know, if you think the short term window versus, let's say, year out window, the TIA to act rate answers will be quite different. Right? In the short term, let's say it is an 80% attach rate and in the. In a year and a half from now, I know it is it is it is around the corner. It will be a 100%, and we hope it to be more than a 100%. Right? it is a it is a TIA that works with other DSPs as well. And there is only 1 of the real TIA vendor that is. Meets the performance bench that you need for a 1.6 terabyte type of product. With the power envelope that you need to meet. That is the truth. Despite what anybody can tell. So we hope to be the other guy outside of the 1 guy. And we have validation to show that. So we expect the attach rate to be a 100% at least and more a year and a half from now. Right? that is the number 1 answer. The next question you had was related to. Could you repeat that for me, please? I just forgot.

Analyst: Sure. Just Yeah. it is an active electrical cable. Right? there is 1 large leader which everybody knows is Credo. They are 93% or maybe 99% of the entire AEC cable market. But I think the market is diverse diversifying now because the problem is getting a lot more complicated. And there are going to be multiple AEC vendors and, our solution will be a pure silicon play, selling it to a cable maker or somebody who makes the what they call the paddle card for the AEC. So our revenues for the AEC will not be as large as selling a whole cable, but it will correspond to what an AEC market would dictate in terms of silicon price inside it. So I would think that it would be similar pricing as our PAM4 DSP per optical. And we expect not to get a big share, let's assume, but we are planning around 1 or 2 big data centers. And then a share of those guys. Intermediaries, and so I think we will be able to get to 20% to 30% in the 1.6 terabit cycle. Somewhere in the next couple of years. But we will not expand it to multiple data centers. Right? We only want 2 data centers in The US. Excellent. Thanks for the help, guys. Thank you.

Operator: Thank you. And we have reached the end of the question-and-answer session. And, therefore, I would like to turn the call back over to Leslie Green for closing remarks.

Leslie Green: Thank you, Shimali. Thank you all for joining. This quarter, we will be presenting at a number of financial conferences and virtual events. Details will be posted on our Investor Relations page Thank you all for joining today, and we look forward to speaking with you again soon.

Operator: Thank you. This concludes today's conference, and you may disconnect your lines at this time. We thank you for your participation.