Third Quarter 2018 Net Revenue of $85.0 million and GAAP and Non-GAAP Gross Margins of 51.6% and 62.5%

CARLSBAD, Calif. — (BUSINESS WIRE) — October 30, 2018 — MaxLinear, Inc. (NYSE: MXL), a leading provider of radio frequency (RF), analog and mixed-signal integrated circuits for the connected home, wired and wireless infrastructure, and industrial and multimarket applications, today announced financial results for the third quarter ended September 30, 2018.

Third Quarter 2018 Business Highlights

• Announced industry's first 100 Gbps transceiver with integrated driver.
• Announced support for 400 Gbps breakout mode clocking in MxL 9354x products.
• MxL213C with Full Spectrum Capture was selected by Inspur Group for its next generation of smart cable gateway set-top boxes.
• Announced collaboration with ZINWELL for outdoor-to-indoor solution for 5G millimeter wave fixed wireless access.
• G.hn Wave-2 chipset was selected by TRIAX to enable enterprise-grade Wi-Fi networking products.
• MxL3710 MoCA Access 2.5 networking IC used by InCoax Networks to develop the world's first multi-gigabit coaxial-based access solution.

Third Quarter Financial Highlights

GAAP basis:

• Net revenue was $85.0 million, down 16% sequentially and down 25% year-on-year.
• GAAP gross margin was 51.6%, compared to 55.5% in the prior quarter, and 45.6% in the year-ago quarter.
• GAAP operating expenses were $56.4 million in the third quarter 2018, or 66% of revenue, compared to $56.6 million or 56% of revenue in the prior quarter, and $62.5 million or 55% of revenue in the year-ago quarter.
• GAAP loss from operations was 15% of revenue, compared to loss from operations of 0% in the prior quarter, and loss from operations of 9% in the year-ago quarter.
• Net cash flow provided by operating activities of $30.7 million, compared to $35.8 million in the prior quarter and $37.7 million in the year-ago quarter.
• GAAP net loss was $13.9 million, compared to net loss of $14.4 million in the prior quarter, and net loss of $9.2 million in the year-ago quarter.
• GAAP diluted loss per share was $0.20, compared to diluted loss per share of $0.21 in the prior quarter, and diluted loss per share of $0.14 in the year-ago quarter.

Non-GAAP basis:

• Non-GAAP gross margin was 62.5%. This compares to 64.6% in the prior quarter, and 62.5% in the year-ago quarter.
• Non-GAAP operating expenses were $35.6 million, or 42% of revenue, compared to $37.1 million or 37% of revenue in the prior quarter, and $37.9 million and 33% of revenue in the year-ago quarter.
• Non-GAAP income from operations was 21% of revenue, compared to 28% in the prior quarter, and 29% in the year-ago quarter.
• Non-GAAP net income was $13.2 million, compared to $23.7 million in the prior quarter, and $27.1 million in the year-ago quarter.
• Non-GAAP diluted earnings per share was $0.19, compared to $0.34 in the prior quarter, and $0.39 in the year-ago quarter.

Management Commentary

“We delivered strong profitability despite the lower revenue run rate we guided to in Q3. We executed solidly towards expanding our pipeline of new products and customer design-wins that will drive strong future revenue growth in the large and rapidly transforming wired and wireless network infrastructure markets,” commented Kishore Seendripu, Ph.D., Chairman and CEO. “While the transition to our new cable broadband DOCSIS data standard product has been slow, we continue to believe that the second half of 2018 represents the trough of our DOCSIS and Connected Home businesses. We are beginning to see a resumption of growth in our cable business starting in Q4. Our continued strong profitability, progress in our target infrastructure markets, and the steady performance of our high-performance analog business together provide us confidence in our forward outlook,” continued Dr. Seendripu.