• Record net revenue of $209.4 million, up 8% sequentially and up 238% year-on-year
• Delivers strong results driven by Infrastructure and Broadband product revenues

CARLSBAD, Calif. — (BUSINESS WIRE) — April 28, 2021 — MaxLinear, Inc. (NYSE: MXL), a leading provider of RF, analog, digital and mixed-signal integrated circuits, today announced financial results for the first quarter ended March 31, 2021.

First Quarter Financial Highlights

GAAP basis:

• Net revenue was $209.4 million, up 8% sequentially, and up 238% year-on-year.
• GAAP gross margin was 53.4%, compared to 42.7% in the prior quarter, and 49.6% in the year-ago quarter.
• GAAP operating expenses were $101.8 million in the first quarter 2021, or 49% of net revenue, compared to $106.7 million in the prior quarter, or 55% of net revenue, and $50.9 million in the year-ago quarter, or 82% of net revenue.
• GAAP income from operations was 5% of revenue, compared to loss from operations of 12% in the prior quarter, and loss from operations of 32% in the year-ago quarter.
• Net cash flow provided by operating activities was $40.3 million, compared to net cash flow provided by operating activities of $74.3 million in the prior quarter, and net cash flow provided by operating activities of $6.6 million in the year-ago quarter.
• GAAP diluted earnings per share was $0.05, compared to diluted loss per share of $0.33 in the prior quarter, and diluted loss per share of $0.21 in the year-ago quarter.

Non-GAAP basis:

• Non-GAAP gross margin was 58.6%. This compares to 57.8% in the prior quarter, and 63.8% in the year-ago quarter.
• Non-GAAP operating expenses were $72.6 million, or 35% of revenue, compared to $75.8 million or 39% of revenue in the prior quarter, and $31.7 million or 51% of revenue in the year-ago quarter.
• Non-GAAP income from operations was 24% of revenue, compared to 19% in the prior quarter, and 13% in the year-ago quarter.
• Non-GAAP diluted earnings per share was $0.55, compared to diluted earnings per share of $0.39 in the prior quarter, and diluted earnings per share of $0.07 in the year-ago quarter.

Recent Business Highlights

• Announced that MaxLinear joined the O-RAN Alliance and will be actively contributing to the development of open, standards-based 5G mobile network architectures.
• Announced MaxLinear's collaboration with Facebook Connectivity on Evenstar OpenRAN Solutions.
• Announced MaxLinear's collaboration with NI to simplify validation of wideband power amplifiers for 5G networks, giving RF Design Validation Engineers a streamlined test and measurement approach.
• Announced industry's first quad-port PHY optimized for 2.5GBASE-T enabling cost effective 2.5G Ethernet multiport applications.
• Announced the release of MaxLinear's G.hn Spirit Grid software designed for large-scale, multi-hop, high-speed, low-latency industrial IoT (IIoT) applications and support for up to 250 end points with one network controller.
• Announced partnership with Inango Systems to allow internet service providers to deploy high-value software services faster.

Management Commentary

“In the first quarter, we posted record revenue, up 8% sequentially, due to strong demand for infrastructure and broadband access products. Solid demand for our broadband access and connectivity products is being driven by a combination of end-market strength and company-specific drivers including silicon content increases and share gains. Our cash flow from operations was approximately $40.3 million with non-GAAP gross margin of 58.6% in the quarter. In Q1, we also started mass production shipments of our 5G 4x4 radio transceiver SoCs. Despite the anticipated challenging manufacturing supply-chain dynamics throughout the rest of the year, owing to the strong demand backdrop for our connectivity and broadband access business, combined with the expected revenue contributions from the continued ramp of our infrastructure products in the latter half of 2021, we feel increasingly confident in the Company’s outlook for the remainder of this year and heading into 2022,” commented Kishore Seendripu, Ph.D., Chairman and CEO.

Second Quarter 2021 Business Outlook

The company expects revenue in the second quarter 2021 to be approximately $200 million to $210 million. The Company also estimates the following:

• GAAP gross margin of approximately 52.5% to 54.5%;
• Non-GAAP gross margin of approximately 58% to 60%;
• GAAP operating expenses of approximately $102.5 million to $106.5 million;
• Non-GAAP operating expenses of approximately $73 million to $77 million;
• GAAP interest and other expense of approximately $3.9 million to $4.1 million; and
• Non-GAAP interest and other expense of approximately $3.8 million to $4.0 million.

Webcast and Conference Call

MaxLinear will host its first quarter financial results conference call today, April 28, 2021 at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). To access this call, dial US toll free: 1-877-407-3109 / International: 1-201-493-6798. A live webcast of the conference call will be accessible from the investor relations section of the MaxLinear website at https://investors.maxlinear.com, and will be archived and available after the call at https://investors.maxlinear.com until May 12, 2021. A replay of the conference call will also be available until May 12, 2021 by dialing US toll free: 1-877-660-6853 / International: 1-201-612-7415 and Conference ID#: 13719103.

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, among others, statements concerning our future financial performance (including specifically our current guidance for second quarter 2021 revenue, gross margins, and operating expenses as well as statements with respect to confidence in the Company’s outlook for the balance of 2021 and into 2022) and statements concerning expectations of potential developments in our target markets, including (without limitation) management’s views with respect to the prospects for and trends in our broadband, connectivity and 5G wireless and fiber-optic high-speed interconnect infrastructure markets. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from any future results expressed or implied by the forward-looking statements. Forward-looking statements are based on management’s current, preliminary expectations and are subject to various risks and uncertainties. In particular, our future operating results are substantially dependent on our assumptions about market trends and conditions and our expectations with respect to the impact of our acquisitions of the Home Gateway Platform Division of Intel Corporation, which we refer to as the Wi-Fi and Broadband assets business and NanoSemi, Inc. In addition, we have incurred incremental acquisition-related indebtedness, which enhances specific risks relating to our ability to service interest and principal payments on our combined indebtedness and limitations on our operating flexibility based on financial and operating covenants in the applicable term loan agreements, including (without limitation) debt covenant restrictions that may limit our ability to obtain additional financing, issue guarantees, create liens, make certain restricted payments or repay certain obligations or to pursue future acquisitions. Additional risks and uncertainties affecting our business and future operating results include, without limitation, the on-going impact of the COVID-19 pandemic, including whether and the extent to which we will continue to benefit from work-from-home and similar initiatives as the pandemic abates and conditions begin to normalize; the adverse impact of the pandemic and global semiconductor chip shortage on our operations around the world; increasing supply chain risks within our industry, including increases in shipping and material costs and substantial shipping delays resulting in extended lead-times; risks associated with our ability to realize improved profitability from our Wi-Fi and Broadband assets business; intense competition in our industry; our dependence on a limited number of customers for a substantial portion of our revenues; potential uncertainties arising from continued consolidation among cable television and satellite operators in our target markets and continued consolidation among competitors within the semiconductor industry generally; our ability to develop and introduce new and enhanced products on a timely basis and achieve market acceptance of those products, particularly as we seek to expand outside of our historic markets; potential decreases in average selling prices for our products; risks relating to intellectual property protection and the prevalence of intellectual property litigation in our industry; our reliance on a limited number of third party manufacturers; our lack of long-term supply contracts and dependence on limited sources of supply, which may be adversely affected by the pandemic; uncertainties concerning how end user markets for our products will develop, including in particular markets we have entered more recently such as broadband and Wi-Fi and 5G wireless and fiber-optic data center high-speed interconnect infrastructure markets but also existing markets which we previously referred to as connected home; and uncertainties concerning the outcome of global trade negotiations, export control limitations, and heightened geopolitical risks generally.