MaxLinear, Inc. Announces Fourth Quarter 2021 Financial Results

Rhea-AI Summary

MaxLinear, Inc. reported record net revenue of $247.9 million for Q4 2021, marking an 8% sequential increase and a 27% year-over-year growth. GAAP gross margin improved to 57.2%, while non-GAAP gross margin reached 61.7%. Operating expenses were $112.4 million, representing 45% of revenue. GAAP diluted EPS was $0.35, versus $0.12 in Q3 2021. For Q1 2022, revenue guidance is estimated at $255 million to $265 million, with expectations of continued growth driven by strong performance in connectivity and broadband markets.

Positive

• Record net revenue of $247.9 million, up 27% year-over-year.
• GAAP gross margin improved to 57.2%, compared to 42.7% a year ago.
• Non-GAAP gross margin reached 61.7%, indicating a shift to higher value products.
• GAAP diluted EPS increased to $0.35 from a loss of $0.33 year-over-year.
• Q1 2022 revenue guidance of $255 million to $265 million shows promising growth.

Negative

• Net cash flow from operating activities decreased to $16.0 million, down from $84.1 million in Q3 2021.

• Record net revenue of $247.9 million, up 8% sequentially and up 27% year-over-year

• GAAP gross margin 57.2% and non-GAAP gross margin 61.7%, up 70 bps and 40 bps from previous quarter, respectively

CARLSBAD, Calif.--(BUSINESS WIRE)-- MaxLinear, Inc. (NASDAQ: MXL), a leading provider of RF, analog, digital and mixed-signal integrated circuits, today announced financial results for the fourth quarter ended December 31, 2021.

Fourth Quarter Financial Highlights

GAAP basis:

• Net revenue was $247.9 million, up 8% sequentially and up 27% year-over-year.
• GAAP gross margin was 57.2%, compared to 56.5% in the prior quarter, and 42.7% in the year-ago quarter.
• GAAP operating expenses were $112.4 million in the fourth quarter 2021, or 45% of net revenue, compared to $106.0 million in the prior quarter, or 46% of net revenue, and $106.7 million in the year-ago quarter, or 55% of net revenue.
• GAAP income from operations was 12% of revenue, compared to income from operations of 10% in the prior quarter, and loss from operations of 12% in the year-ago quarter.
• Net cash flow provided by operating activities was $16.0 million, compared to net cash flow provided by operating activities of $84.1 million in the prior quarter, and net cash flow provided by operating activities of $74.3 million in the year-ago quarter.
• GAAP diluted earnings per share was $0.35, compared to diluted earnings per share of $0.12 in the prior quarter, and diluted loss per share of $0.33 in the year-ago quarter.

Non-GAAP basis:

• Non-GAAP gross margin was 61.7%. This compares to 61.3% in the prior quarter, and 57.8% in the year-ago quarter.
• Non-GAAP operating expenses were $75.9 million, or 31% of revenue, compared to $74.4 million or 32% of revenue in the prior quarter, and $75.8 million or 39% of revenue in the year-ago quarter.
• Non-GAAP income from operations was 31% of revenue, compared to 29% in the prior quarter, and 19% in the year-ago quarter.
• Non-GAAP diluted earnings per share was $0.86, compared to diluted earnings per share of $0.75 in the prior quarter, and diluted earnings per share of $0.39 in the year-ago quarter.

Management Commentary

“In the fourth quarter, revenue was up 8% sequentially and up 27% year-over-year, driven by strong growth across our connectivity, broadband and infrastructure markets. Wi-Fi grew 40% sequentially and we exited Q4 on a $100 million annualized revenue run rate which we expect to build upon through 2022. Non-GAAP gross margin for Q4 improved to 61.7% driven by product mix shift towards higher value products. We are excited about our prospects for continued future growth driven by our comprehensive product portfolio, and the accelerating pace of new product launches particularly in connectivity, fiber-to-the home broadband, optical, and wireless infrastructure markets,” commented Kishore Seendripu, Ph.D., Chairman and CEO.

First Quarter 2022 Business Outlook

The company expects revenue in the first quarter 2022 to be approximately $255 million to $265 million. The Company also estimates the following:

• GAAP gross margin of approximately 57% to 59%;
• Non-GAAP gross margin of approximately 61% to 63%;
• GAAP operating expenses of approximately $108 million to $114 million;
• Non-GAAP operating expenses of approximately $76 million to $82 million;
• GAAP and non-GAAP interest and other expense of approximately $2.7 million.

Webcast and Conference Call

MaxLinear will host its fourth quarter financial results conference call today, February 2, 2022 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 February 16, 2022. A replay of the conference call will also be available until February 16, 2022 by dialing US toll free: 1-877-660-6853 / International: 1-201-612-7415 and Conference ID#: 13726224.

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 first quarter 2022 revenue, gross margins, and operating expenses as well as statements with respect to confidence in the Company’s outlook for first quarter 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 infrastructure markets, and in particular, expectations concerning the development of our Wi-Fi market. 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. Additional risks and uncertainties affecting our business and future operating results include, without limitation, increasing supply chain risks within our industry, including increases in shipping and material costs and substantial shipping delays resulting in extended lead-times; inflation trends in our supply chain and in the global economy generally; the on-going impact of the COVID-19 pandemic on our business, including the extent to which our broadband businesses will continue to benefit from work-from-home and similar initiatives as the pandemic abates; the impact of our 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, granting liens, undergoing certain fundamental changes, or making investments or certain restricted payments, and selling assets; 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.

In addition to these risks and uncertainties, investors should review the risks and uncertainties contained in our filings with the Securities and Exchange Commission (SEC), including our Quarterly Report on Form 10-Q for the quarter ended September 30, 2021, and our Current Reports on Form 8-K, as well as the information to be set forth under the caption “Risk Factors” in MaxLinear’s Annual Report on Form 10-K for the year ended December 31, 2021, which we expect to file soon. All forward-looking statements are based on the estimates, projections and assumptions of management as of February 2, 2022, and MaxLinear is under no obligation (and expressly disclaims any such obligation) to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

Use of Non-GAAP Financial Measures

To supplement our unaudited consolidated financial statements presented on a basis consistent with GAAP, we disclose certain non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating expenses as a percentage of revenue, income from operations as percentage of revenue, and diluted earnings per share. These supplemental measures exclude the effects of (i) stock-based compensation expense; (ii) accruals related to our performance based bonus plan for 2021, which we currently intend to settle in shares of our common stock; (iii) accruals related to our performance based bonus plan for 2020, which we settled in shares of common stock in 2021; (iv) amortization of inventory fair value adjustments; (v) amortization of purchased intangible assets; (vi) research and development funded by others; (vii) acquisition and integration costs related to our acquisitions; (viii) professional fees and settlement costs related to IP and commercial litigation matters; (ix) severance and other restructuring charges; (x) impairment losses on intangible assets; (xi) loss from extinguishment of debt; (xii) other non-recurring interest and other income (expenses), net attributable to acquisitions and (xiii) non-cash income tax benefits and expenses. These non-GAAP measures are not in accordance with and do not serve as an alternative for GAAP. We believe that these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our GAAP results of operations. These non-GAAP measures should only be viewed in conjunction with corresponding GAAP measures. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of our performance.

We believe that non-GAAP financial measures can provide useful information to both management and investors by excluding certain non-cash and other one-time expenses that are not indicative of our core operating results. Among other uses, our management uses non-GAAP measures to compare our performance relative to forecasts and strategic plans and to benchmark our performance externally against competitors. In addition, management’s incentive compensation will be determined in part using these non-GAAP measures because we believe non-GAAP measures better reflect our core operating performance.

The following are explanations of each type of adjustment that we incorporate into non-GAAP financial measures:

Stock-based compensation expense relates to equity incentive awards granted to our employees, directors, and consultants. Our equity incentive plans are important components of our employee incentive compensation arrangements and are reflected as expenses in our GAAP results. Stock-based compensation expense has been and will continue to be a significant recurring expense for MaxLinear. While we include the dilutive impact of equity awards in weighted average shares outstanding, the expense associated with stock-based awards reflects a non-cash charge that we exclude from non-GAAP net income.

Bonuses under our executive and non-executive bonus programs have been excluded from our non-GAAP net income for all periods reported. Bonus payments for the 2020 performance periods were settled through the issuance of shares of common stock under our equity incentive plans in February 2021. We currently expect that bonus awards under our fiscal 2021 program will be settled in common stock in the first quarter of fiscal 2022.

Expenses incurred in relation to acquisitions include amortization of purchased intangible assets, amortization of inventory fair value adjustments, acquisition and integration costs primarily consisting of professional and consulting fees, and amortization of discount on deferred purchase price payments to interest expense. Gains related to acquisitions include a gain on sale of an investment in a privately-held entity included in interest and other income.

Research and development funded by others represents proceeds received under contracts for jointly funded R&D projects to develop technology that may be commercialized into a product in the future. Such proceeds have not yet been recognized in GAAP results as the Company may be required to repay all or a portion of the funds provided by the other party under certain conditions. Management believes it is not probable that it will trigger such conditions.

Impairment losses relate to certain intangible assets.

Restructuring charges incurred are related to our restructuring plans which eliminate redundancies and primarily include severance and restructuring costs related to impairment of leased right-of-use assets or from exiting certain facilities.

Loss on extinguishment of debt is related to the charge-off of remaining unamortized debt discount and issuance costs on debt we repaid early with proceeds from a new term loan in June 2021.

Expenses incurred in relation to our intellectual property and commercial litigation include professional fees incurred.

Income tax benefits and expense adjustments are those that do not affect cash income taxes payable.

Reconciliations of non-GAAP measures for the historic periods disclosed in this press release appear below. Because of the inherent uncertainty associated with our ability to project future charges, particularly related to stock-based compensation and its related tax effects as well as potential impairments, we have not provided a reconciliation for non-GAAP guidance provided for the first quarter 2022.

About MaxLinear, Inc.

MaxLinear, Inc. (NASDAQ:MXL) is a leading provider of radio frequency (RF), analog, digital and mixed-signal integrated circuits for access and connectivity, wired and wireless infrastructure, and industrial and multi-market applications. MaxLinear is headquartered in Carlsbad, California. For more information, please visit www.maxlinear.com.

MXL is MaxLinear’s registered trademark. Other trademarks appearing herein are the property of their respective owners.

MAXLINEAR, INC.
UNAUDITED GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
		Three Months Ended
		December 31, 2021				September 30, 2021				December 31, 2020
Net revenue		$	247,889			$	229,774			$	194,716
Cost of net revenue			106,112				99,981				111,629
Gross profit			141,777				129,793				83,087
Operating expenses:
Research and development			73,320				67,538				70,504
Selling, general and administrative			39,120				38,469				36,238
Total operating expenses			112,440				106,007				106,742
Income (loss) from operations			29,337				23,786				(23,655	)
Interest income			32				28				126
Interest expense			(2,400	)			(2,649	)			(4,724	)
Other income (expense), net			1,510				(105	)			(550	)
Total other income (expense), net			(858	)			(2,726	)			(5,148	)
Income (loss) before income taxes			28,479				21,060				(28,803	)
Income tax provision (benefit)			303				11,802				(4,131	)
Net income (loss)		$	28,176			$	9,258			$	(24,672	)
Net income (loss) per share:
Basic		$	0.37			$	0.12			$	(0.33	)
Diluted		$	0.35			$	0.12			$	(0.33	)
Shares used to compute net income (loss) per share:
Basic			76,755				76,582				74,335
Diluted			81,567				79,815				74,335

MAXLINEAR, INC.
UNAUDITED GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
		Years Ended
		December 31, 2021				December 31, 2020
Net revenue		$	892,398			$	478,596
Cost of net revenue			396,566				265,798
Gross profit			495,832				212,798
Operating expenses:
Research and development			278,440				179,993
Selling, general and administrative			149,943				130,025
Impairment losses			—				86
Restructuring charges			2,204				3,833
Total operating expenses			430,587				313,937
Income (loss) from operations			65,245				(101,139	)
Interest income			78				409
Interest expense			(12,996	)			(12,952	)
Loss on extinguishment of debt			(5,221	)			—
Other income (expense), net			764				(1,170	)
Total other income (expense), net			(17,375	)			(13,713	)
Income (loss) before income taxes			47,870				(114,852	)
Income tax provision (benefit)			5,901				(16,259	)
Net income (loss)		$	41,969			$	(98,593	)
Net income (loss) per share:
Basic		$	0.55			$	(1.35	)
Diluted		$	0.53			$	(1.35	)
Shares used to compute net income (loss) per share:
Basic			76,037				73,133
Diluted			79,679				73,133

MAXLINEAR, INC.
UNAUDITED GAAP CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
		Three Months Ended
		December 31, 2021				September 30, 2021				December 31, 2020
Operating Activities
Net income (loss)		$	28,176			$	9,258			$	(24,672	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Amortization and depreciation			24,353				23,117				22,694
Amortization of inventory fair value adjustments			—				—				18,500
Amortization of debt issuance costs and accretion of discount on debt and leases			416				513				815
Stock-based compensation			16,415				16,022				14,540
Deferred income taxes			(4,640	)			6,866				(13,235	)
Loss on disposal of property and equipment			—				145				—
(Gain) loss on foreign currency and other			250				(24	)			914
Excess tax benefits on stock based awards			(2,046	)			(738	)			(147	)
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable			(12,265	)			28,454				37,736
Inventory			(4,249	)			(28,844	)			(11,657	)
Prepaid expenses and other assets			(9,301	)			39				(4,597	)
Leased right-of-use assets			—				—				36
Accounts payable, accrued expenses and other current liabilities			(22,283	)			28,743				(10,099	)
Accrued compensation			9,746				8,616				9,485
Accrued price protection liability			(8,956	)			(5,319	)			29,280
Lease liabilities			(2,835	)			(2,723	)			(2,111	)
Other long-term liabilities			3,252				(48	)			6,787
Net cash provided by operating activities			16,033				84,077				74,269
Investing Activities
Purchases of property and equipment			(12,242	)			(9,624	)			(2,355	)
Purchases of intangible assets			(965	)			(5,504	)			(2,411	)
Cash used in acquisitions, net of cash acquired			(5,000	)			(7,500	)			—
Net cash used in investing activities			(18,207	)			(22,628	)			(4,766	)
Financing Activities
Payment of debt issuance cost			(29	)			(17	)			—
Repayment of debt			(20,000	)			(20,000	)			(17,188	)
Net proceeds from issuance of common stock			2,494				192				2,798
Minimum tax withholding paid on behalf of employees for restricted stock units			(2,068	)			(976	)			(643	)
Repurchase of common stock			(15,403	)			(1,008	)			—
Net cash used in financing activities			(35,006	)			(21,809	)			(15,033	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash			(1,636	)			(520	)			(1,178	)
Increase (decrease) in cash, cash equivalents and restricted cash			(38,816	)			39,120				53,292
Cash, cash equivalents and restricted cash at beginning of period			170,554				131,434				96,742
Cash, cash equivalents and restricted cash at end of period		$	131,738			$	170,554			$	150,034

MAXLINEAR, INC.
UNAUDITED GAAP CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
		Years Ended
		December 31, 2021				December 31, 2020
Operating Activities
Net income (loss)		$	41,969			$	(98,593	)
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Amortization and depreciation			91,792				76,513
Impairment losses			—				86
Amortization of inventory fair value adjustments			—				32,945
Amortization of debt issuance costs and accretion of discount on debt and leases			3,000				2,201
Stock-based compensation			59,358				47,597
Deferred income taxes			(3,235	)			(18,488	)
Loss on disposal of property and equipment			533				—
Impairment of leasehold improvements			226				319
Impairment of leased right-of-use assets			429				1,508
Loss on extinguishment of debt			5,221				—
Loss on foreign currency			634				1,289
Excess tax benefits on stock-based awards			(7,415	)			(677	)
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable			(51,690	)			(16,856	)
Inventory			(33,689	)			(31,837	)
Prepaid expenses and other assets			24,186				(38,954	)
Leased right-of-use assets			72				441
Accounts payable, accrued expenses and other current liabilities			12,771				57,094
Accrued compensation			33,595				32,606
Accrued price protection liability			(7,320	)			34,719
Lease liabilities			(9,905	)			(6,386	)
Other long-term liabilities			7,701				(1,934	)
Net cash provided by operating activities			168,233				73,593
Investing Activities
Purchases of property and equipment			(39,176	)			(12,487	)
Purchases of intangible assets			(7,581	)			(2,799	)
Cash used in acquisitions, net of cash acquired			(40,000	)			(160,000	)
Purchases of available-for-sale securities			(5,000	)			—
Net cash used in investing activities			(91,757	)			(175,286	)
Financing Activities
Proceeds from the issuance of debt			350,000				175,000
Payment of debt issuance cost			(4,173	)			(2,696	)
Repayment of debt			(409,813	)			(17,188	)
Net proceeds from issuance of common stock			8,780				8,068
Minimum tax withholding paid on behalf of employees for restricted stock units			(13,149	)			(3,535	)
Repurchase of common stock			(23,548	)			—
Net cash provided by (used in) financing activities			(91,903	)			159,649
Effect of exchange rate changes on cash, cash equivalents and restricted cash			(2,869	)			(1,039	)
Increase (decrease) in cash, cash equivalents and restricted cash			(18,296	)			56,917
Cash, cash equivalents and restricted cash at beginning of period			150,034				93,117
Cash, cash equivalents and restricted cash at end of period		$	131,738			$	150,034

MAXLINEAR, INC.
UNAUDITED GAAP CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
		December 31, 2021			September 30, 2021			December 31, 2020
Assets
Current assets:
Cash and cash equivalents		$	130,572		$	169,424		$	148,901
Short-term restricted cash			105			107			115
Accounts receivable, net			119,724			106,867			67,442
Inventory			131,703			127,347			97,839
Prepaid expenses and other current assets			22,000			14,535			47,421
Total current assets			404,104			418,280			361,718
Long-term restricted cash			1,061			1,023			1,018
Property and equipment, net			60,924			53,022			39,470
Leased right-of-use assets			27,269			23,668			21,886
Intangible assets, net			152,540			163,894			207,266
Goodwill			306,668			302,828			302,828
Deferred tax assets			89,168			84,660			86,065
Other long-term assets			8,650			6,519			2,191
Total assets		$	1,050,384		$	1,053,894		$	1,022,442
Liabilities and stockholders’ equity
Current liabilities		$	207,395		$	231,274		$	233,661
Long-term lease liabilities			24,640			21,400			20,862
Long-term debt			306,153			326,027			363,592
Other long-term liabilities			22,998			17,650			13,210
Stockholders’ equity			489,198			457,543			391,117
Total liabilities and stockholders’ equity		$	1,050,384		$	1,053,894		$	1,022,442

MAXLINEAR, INC.
UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS
(in thousands, except per share data)
		Three Months Ended
		December 31, 2021				September 30, 2021				December 31, 2020
GAAP gross profit		$	141,777			$	129,793			$	83,087
Stock-based compensation			152				151				160
Performance based equity			137				123				124
Amortization of inventory fair value adjustments			—				—				18,500
Amortization of purchased intangible assets			10,759				10,743				10,667
Non-GAAP gross profit			152,825				140,810				112,538
GAAP R&D expenses			73,320				67,538				70,504
Stock-based compensation			(8,243	)			(7,691	)			(7,410	)
Performance based equity			(8,224	)			(6,642	)			(6,124	)
Research and development funded by others			(2,000	)			—				—
Acquisition and integration costs			(25	)			—				—
Non-GAAP R&D expenses			54,828				53,205				56,970
GAAP SG&A expenses			39,120				38,469				36,238
Stock-based compensation			(8,020	)			(8,179	)			(6,970	)
Performance based equity			(3,934	)			(3,120	)			(2,991	)
Amortization of purchased intangible assets			(5,928	)			(5,811	)			(6,200	)
Acquisition and integration costs			(192	)			(135	)			(1,200	)
IP litigation costs, net			—				—				(32	)
Non-GAAP SG&A expenses			21,046				21,224				18,845
GAAP income (loss) from operations			29,337				23,786				(23,655	)
Total non-GAAP adjustments			47,614				42,595				60,378
Non-GAAP income from operations			76,951				66,381				36,723
GAAP interest and other income (expense), net			(858	)			(2,726	)			(5,148	)
Non-recurring interest and other income (expense), net			(1,893	)			73				384
Non-GAAP interest and other income (expense), net			(2,751	)			(2,653	)			(4,764	)
GAAP income (loss) before income taxes			28,479				21,060				(28,803	)
Total non-GAAP adjustments			45,721				42,668				60,762
Non-GAAP income before income taxes			74,200				63,728				31,959
GAAP income tax provision (benefit)			303				11,802				(4,131	)
Adjustment for non-cash tax benefits/expenses			4,149				(7,979	)			6,048
Non-GAAP income tax provision			4,452				3,823				1,917
GAAP net income (loss)			28,176				9,258				(24,672	)
Total non-GAAP adjustments before income taxes			45,721				42,668				60,762
Less: total tax adjustments			4,149				(7,979	)			6,048
Non-GAAP net income		$	69,748			$	59,905			$	30,042
Shares used in computing non-GAAP basic net income per share			76,755				76,582				74,335
Shares used in computing non-GAAP diluted net income per share			81,567				79,815				77,926
Non-GAAP basic net income per share		$	0.91			$	0.78			$	0.40
Non-GAAP diluted net income per share		$	0.86			$	0.75			$	0.39

MAXLINEAR, INC.
UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS
(in thousands, except per share data)
		Years Ended
		December 31, 2021				December 31, 2020
GAAP gross profit		$	495,832			$	212,798
Stock-based compensation			620				577
Performance based equity			469				482
Amortization of inventory fair value adjustments			—				32,945
Amortization of purchased intangible assets			42,992				37,730
Non-GAAP gross profit			539,913				284,532
GAAP R&D expenses			278,440				179,993
Stock-based compensation			(30,364	)			(22,252	)
Performance based equity			(27,713	)			(16,118	)
Research and development funded by others			(5,800	)			—
Acquisition and integration costs			(155	)			—
Non-GAAP R&D expenses			214,408				141,623
GAAP SG&A expenses			149,943				130,025
Stock-based compensation			(28,374	)			(24,172	)
Performance based equity			(12,301	)			(8,262	)
Amortization of purchased intangible assets			(23,625	)			(23,529	)
Acquisition and integration costs			(1,913	)			(14,322	)
IP litigation costs, net			(11	)			(181	)
Non-GAAP SG&A expenses			83,719				59,559
GAAP impairment losses			—				86
Impairment losses			—				(86	)
Non-GAAP impairment losses			—				—
GAAP restructuring expenses			2,204				3,833
Restructuring charges			(2,204	)			(3,833	)
Non-GAAP restructuring expenses			—				—
GAAP income (loss) from operations			65,245				(101,139	)
Total non-GAAP adjustments			176,541				184,489
Non-GAAP income from operations			241,786				83,350
GAAP loss on extinguishment of debt			(5,221	)			—
Loss on extinguishment of debt			5,221				—
Non-GAAP loss on extinguishment of debt			—				—
GAAP interest and other income (expense), net			(12,154	)			(13,713	)
Non-recurring interest and other income (expense), net			(1,377	)			384
Non-GAAP interest and other income (expense), net			(13,531	)			(13,329	)
GAAP income (loss) before income taxes			47,870				(114,852	)
Total non-GAAP adjustments			180,385				184,873
Non-GAAP income before income taxes			228,255				70,021
GAAP income tax provision (benefit)			5,901				(16,259	)
Adjustment for non-cash tax benefits/expenses			7,794				20,460
Non-GAAP income tax provision			13,695				4,201
GAAP net income (loss)			41,969				(98,593	)
Total non-GAAP adjustments before income taxes			180,385				184,873
Less: total tax adjustments			7,794				20,460
Non-GAAP net income		$	214,560			$	65,820
Shares used in computing non-GAAP basic net income per share			76,037				73,133
Shares used in computing non-GAAP diluted net income per share			79,679				74,928
Non-GAAP basic net income per share		$	2.82			$	0.90
Non-GAAP diluted net income per share		$	2.69			$	0.88

MAXLINEAR, INC.
UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS
(in thousands, except per share data)
		Three Months Ended
		December 31, 2021		September 30, 2021		December 31, 2020
GAAP gross profit		57.2%		56.5%		42.7%
Stock-based compensation		0.1%		0.1%		0.1%
Performance based equity		0.1%		0.1%		0.1%
Amortization of inventory fair value adjustments		—%		—%		9.5%
Amortization of purchased intangible assets		4.3%		4.7%		5.5%
Non-GAAP gross profit		61.7%		61.3%		57.8%
GAAP R&D expenses		29.6%		29.4%		36.2%
Stock-based compensation		(3.3) %		(3.4) %		(3.8) %
Performance based equity		(3.3) %		(2.9) %		(3.1) %
Research and development funded by others		(0.8) %		—%		—%
Acquisition and integration costs		—%		—%		—%
Non-GAAP R&D expenses		22.1%		23.2%		29.3%
GAAP SG&A expenses		15.8%		16.7%		18.6%
Stock-based compensation		(3.2) %		(3.6) %		(3.6) %
Performance based equity		(1.6) %		(1.4) %		(1.5) %
Amortization of purchased intangible assets		(2.4) %		(2.5) %		(3.2) %
Acquisition and integration costs		(0.1) %		(0.1) %		(0.6) %
IP litigation costs, net		—%		—%		—%
Non-GAAP SG&A expenses		8.5%		9.2%		9.7%
GAAP income (loss) from operations		11.8%		10.4%		(12.2) %
Total non-GAAP adjustments		19.2%		18.5%		31.0%
Non-GAAP income from operations		31.0%		28.9%		18.9%
GAAP interest and other income (expense), net		(0.4) %		(1.2) %		(2.6) %
Non-recurring interest and other income (expense), net		(0.8) %		—%		0.2%
Non-GAAP interest and other income (expense), net		(1.1) %		(1.2) %		(2.5) %
GAAP income (loss) before income taxes		11.5%		9.2%		(14.8) %
Total non-GAAP adjustments before income taxes		18.4%		18.6%		31.2%
Non-GAAP income before income taxes		29.9%		27.7%		16.4%
GAAP income tax provision (benefit)		0.1%		5.1%		(2.1) %
Adjustment for non-cash tax benefits/expenses		1.7%		(3.5) %		3.1%
Non-GAAP income tax provision		1.8%		1.7%		1.0%
GAAP net income (loss)		11.4%		4.0%		(12.7) %
Total non-GAAP adjustments before income taxes		18.4%		18.6%		31.2%
Less: total tax adjustments		1.7%		(3.5) %		3.1%
Non-GAAP net income		28.1%		26.1%		15.4%

MAXLINEAR, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
		Years Ended
		December 31, 2021		December 31, 2020
GAAP gross profit		55.6%		44.5%
Stock-based compensation		0.1%		0.1%
Performance based equity		0.1%		0.1%
Amortization of inventory fair value adjustments		—%		6.9%
Amortization of purchased intangible assets		4.8%		7.9%
Non-GAAP gross profit		60.5%		59.5%
GAAP R&D expenses		31.2%		37.6%
Stock-based compensation		(3.4) %		(4.7) %
Performance based equity		(3.1) %		(3.4) %
Research and development funded by others		(0.7) %		—%
Acquisition and integration costs		—%		—%
Non-GAAP R&D expenses		24.0%		29.6%
GAAP SG&A expenses		16.8%		27.2%
Stock-based compensation		(3.2) %		(5.1) %
Performance based equity		(1.4) %		(1.7) %
Amortization of purchased intangible assets		(2.7) %		(4.9) %
Acquisition and integration costs		(0.2) %		(3.0) %
IP litigation costs, net		—%		—%
Non-GAAP SG&A expenses		9.4%		12.4%
GAAP impairment losses		—%		0.02%
Impairment losses		—%		(0.02) %
Non-GAAP impairment losses		—%		—%
GAAP restructuring expenses		0.3%		0.8%
Restructuring charges		(0.3) %		(0.8) %
Non-GAAP restructuring expenses		—%		—%
GAAP income (loss) from operations		7.3%		(21.1) %
Total non-GAAP adjustments		19.8%		38.5%
Non-GAAP income from operations		27.1%		17.4%
GAAP loss on extinguishment of debt		(0.6) %		—%
Loss on extinguishment of debt		0.6%		—%
Non-GAAP loss on extinguishment of debt		—%		—%
GAAP interest and other income (expense), net		(1.4) %		(2.9) %
Non-recurring interest and other income (expense), net		(0.2) %		0.1%
Non-GAAP interest and other income (expense), net		(1.5) %		(2.8) %
GAAP income (loss) before income taxes		5.4%		(24.0) %
Total non-GAAP adjustments		20.2%		38.6%
Non-GAAP income before income taxes		25.6%		14.6%
GAAP income tax provision (benefit)		0.7%		(3.4) %
Adjustment for non-cash tax benefits/expenses		0.9%		4.3%
Non-GAAP income tax provision		1.5%		0.9%
GAAP net income (loss)		4.7%		(20.6) %
Total non-GAAP adjustments before income taxes		20.2%		38.6%
Less: total tax adjustments		0.9%		4.3%
Non-GAAP net income		24.0%		13.8%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220202005918/en/

MaxLinear, Inc. Investor Relations Contact:

Steven Litchfield

Tel: 949-333-0080

IR@maxlinear.com

Source: MaxLinear, Inc.

FAQ

What were MaxLinear's revenue results for Q4 2021?

MaxLinear reported a net revenue of $247.9 million for Q4 2021, up 27% year-over-year.

What is the guidance for MaxLinear's Q1 2022 revenue?

MaxLinear expects revenue for Q1 2022 to be approximately $255 million to $265 million.

What was MaxLinear's diluted EPS for Q4 2021?

MaxLinear's diluted EPS for Q4 2021 was $0.35, compared to a loss per share of $0.33 in the year-ago quarter.

How did MaxLinear's gross margins perform in Q4 2021?

GAAP gross margin was 57.2%, while non-GAAP gross margin was 61.7% in Q4 2021.