MaxLinear MXL reported second-quarter 2026 non-GAAP earnings of 35 cents per share, which beat the Zacks Consensus Estimate by 6.1%. The company reported earnings of 2 cents per share in the year-ago quarter.
Revenues of $168.8 million increased 55% and beat the consensus mark by 2.3%. Results benefited from accelerating adoption of optical AI data center products. Infrastructure revenues surged 145% year over year and remained the company’s largest revenue category.
MXL’s Infrastructure Business Drives Growth
Infrastructure revenues were $85 million in the second quarter, rising 35% sequentially. Growth was led by high-speed optical interconnects as production ramps broadened across data center-oriented platforms.
Keystone, MaxLinear’s 100-gigabit-per-lane PAM4 digital signal processor, continued ramping into high-volume production. MaxLinear said the latest revenue growth is increasingly driven by 800G deployments, with customers spanning U.S. and Asian hyperscalers, data center operators and equipment makers.
MaxLinear, Inc Price, Consensus and EPS Surprise
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MaxLinear's Broadband and Connectivity Sales Rise
Broadband revenues increased to $45 million, while connectivity revenues reached roughly $24 million. Industrial and multimarket revenues were about $15 million.
Broadband and connectivity gains reflected deployments of single-chip fiber PON and Wi-Fi 7 gateway platforms at major Tier 1 service providers in North America and Europe. MXL is also in the early stages of Ultra DOCSIS 3.1 and 4.0 deployments, which management expects to contribute as customer ramps progress through 2027 and 2028.
MXL’s New Wins Broaden AI Exposure
The company completed qualification of its first XGS-PON design win for a hyperscale data center control network. The program is expected to begin ramping in 2027.
MaxLinear also secured USB bridge controller design wins at two major hyperscalers for AI rack management. Its Panther storage accelerator family continued gaining traction, with management expecting revenues to roughly double in 2026 and potentially nearly double again in 2027.
MaxLinear Expands Optical Data Center Reach
The company raised its 2026 optical data center revenue expectations again, citing robust customer orders and stronger visibility into program ramps. Management said order visibility extends roughly six months, supporting confidence in second-half demand and the trajectory into 2027.
Rushmore, MaxLinear’s 1.6-terabit PAM4 platform operating at 200 gigabits per lane, is in customer qualification. Initial revenues are expected in 2027, with broader ramps anticipated through 2028 and 2029. Washington, a matching transimpedance amplifier and Annapurna, an electrical retimer platform, widen the company’s exposure to next-generation AI connectivity.
MXL’s Margins Show Operating Leverage
Non-GAAP gross margin was 59.5% compared with 59.1% in the year-ago quarter.
Non-GAAP operating expenses were $62.8 million, up 11% year over year.
Non-GAAP operating margin expanded to 22.3% from 7.2%, reflecting the stronger infrastructure mix and higher revenues. Management expects infrastructure products to support further margin improvement. However, rising wafer, packaging and testing costs remain a headwind, with the company seeking to pass some increases to customers.
MaxLinear’s Balance Sheet Reflects Inventory Build
MaxLinear ended the quarter with $93.7 million in cash, cash equivalents and restricted cash.
Operating activities generated $4.8 million in cash, reversing the cash use recorded in the previous quarter.
Inventory rose to $105.5 million from $85.8 million sequentially as the company supported rising data center demand and secured wafer supply. Days of inventory improved to 123 from 128, while days sales outstanding edged up to 28 from 27.
MXL Guides to Strong Q3 Growth
For the third quarter of 2026, MXL expects revenues between $210 million and $220 million. Management anticipates sequential growth across all four business categories, with infrastructure again leading on optical data center interconnect demand.
The company projects non-GAAP gross margin of 58.5-61.5% and non-GAAP operating expenses of $66-$71 million.
Zacks Rank & Stocks to Consider
MaxLinear currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector that are set to report their quarterly results are Amphenol APH, Bandwidth BAND and Fortinet FTNT. Amphenol, Bandwidth and Fortinet sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Amphenol, Bandwidth and Fortinet are set to report their second-quarter 2026 results on July 29. Year to date, shares of Amphenol, Bandwidth and Fortinet have returned 16.5%, 279.8% and 89.6%, respectively.
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