MaxLinear fell 17% after a Q2 beat was overshadowed by a weak Q3 forecast. Analysts raised targets on 800G/1.6T data center demand, calling the infrastructure segment a multiyear growth driver.
MaxLinear (MXL) shares fell 17% on Friday after the company issued a Q3 revenue forecast that missed analyst estimates, overshadowing a Q2 earnings beat.
The chipmaker reported adjusted earnings of 22 cents a share on revenue of $112.1 million for the second quarter. Analysts had expected 17 cents on $108.5 million. The beat came on stronger-than-expected sales of 800G and 1.6T DSP products for data center infrastructure, a segment executives described as a growth driver.
Q3 guidance disappointed, however. MaxLinear forecast revenue between $90 million and $100 million, well below the $110.5 million consensus. Management cited ongoing inventory corrections in the broadband and industrial markets.
Analysts reacted by raising price targets even as they cut estimates. Needham kept a Buy rating and lifted its target to $40 from $35, calling the data center ramp a multiyear catalyst. Rosenblatt raised its target to $38, saying the infrastructure gains offset near-term headwinds elsewhere.
MaxLinear ended the session at $28.31, its lowest close since early May. The stock remains up about 12% year to date, supported by the data center narrative.
Needham analyst N. Quinn Bolton said the Q3 guide reflects a trough in the legacy business, with the infrastructure segment growing fast enough to re-rate the stock once the cycle turns.
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