Fourth Quarter 2017 GAAP Net Revenue of $113.7 million,
GAAP Diluted Loss per Share of $0.29,
and Non-GAAP Diluted Earnings per Share of $0.38
CARLSBAD, Calif., Feb. 13, 2018 (GLOBE NEWSWIRE) -- MaxLinear, Inc. (NYSE:MXL), a leading provider of radio-frequency, mixed-signal and high-performance analog integrated circuits for the connected home, wired and wireless infrastructure, and industrial and multi-market applications, today announced financial results for the fourth quarter ended December 31, 2017.
“We are pleased to announce the financial results of fourth quarter 2017, which brings to close a very eventful 2017. In the fourth quarter, we delivered GAAP net revenue of $113.7 million and generated $21.7 million of net cash flow from operating activities. These strong cash flows enabled a further $20.0 million in debt repayment in the quarter. As a result, our 2017 total debt repayment stands at $70.0 million since the closing of the Exar acquisition in May 2017, which is consistent with our stated objective of using net cash generation to aggressively deleverage. Our ability to find efficiencies in our combined operations has enabled MaxLinear to maintain its aggressive pace of new technology platform innovations that will yield benefits to MaxLinear shareholders well into the future.
“In 2017, we recorded another year of record revenue with total GAAP net revenue of $420.3 million, or 8% sequential growth, in the face of legacy Entropic product declines in analog channel-stacking solutions and video SoCs, and persistent China macro optical fiber headwinds. We were able to weather these challenges due to revenue strength in our broadband franchise, revenue contributions from our Exar acquisition and the acquisition of Marvell’s G.hn business, as well as contributions from our expanding portfolio of network infrastructure solutions.
“Most excitingly, 2017 was undoubtedly the most significant year for the company from an engineering execution and market expansion perspective. In 2017, we started mass production of the industry’s first 28nm CMOS RF transceiver spanning the 5-45Ghz frequency for the wireless backhaul market. We also completed the tape-out of the industry’s first 400Gbps PAM-4 SerDes device for the hyperscale data-center market. For the cable infrastructure market, we completed the tape-out of the industry's first Full-Duplex (FDX) DOCSIS cable fiber node infrastructure remote PHY system-on-chip device. We also successfully integrated two strategic technology platform acquisitions in the form of Exar Corporation and Marvell's G.hn home networking business. We are very excited by our expanding technology footprint, which addresses some of the most complex analog and mixed-signal communications platforms in the industry. As a result, we continue to expand our existing TAM and solidify our position as one of the industry’s leading providers of CMOS mixed-signal ICs,” commented Kishore Seendripu, Ph.D., Chairman and CEO.
Fourth Quarter 2017 Business Highlights
- Demonstrated industry-first 400Gbps pulse-amplitude-modulation digital signal processing systems-on-a-chip solutions with integrated laser drivers to address the high-speed optical interconnect needs of mega-scale cloud data centers and network enterprises.
- G.hn Wave-2 networking chipset selected by Comtrend for new carrier-grade Wi-Fi connectivity extender solution in the North American service provider market.
- Demonstrated NetAerial cord cutter ATSC TV distribution system, which incorporates MaxLinear's ATSC TV tuners and G.hn chipsets, to stream live TV to connected smart devices with Geniatech.
- Announced plans to introduce G.hn connectivity solutions for the automotive, industrial, security and utility markets for use in vehicles, industrial products, security cameras, smart meters and other smart grid applications.
- Announced collaboration with Airgain Inc. to demonstrate more than 2 Gbps data transfer through low-emissivity glass windows for 5G fixed wireless access with MaxLinear's AirPHY™ wireless modem technology and Airgain's broadband, near-field antenna module.
- Commenced shipments of digital satellite low-noise block downconverters and channel stacking ICs to Telefónica with ProBrand International for two South American countries.
Fourth Quarter Financial Highlights
The fourth quarter 2017 results continue to be influenced by the acquisitions and related purchase price accounting impacts of Marvell’s G.hn business in April 2017 and Exar in May 2017, and interest on the term loan related to the Exar transaction.
- Net revenue was $113.7 million, flat sequentially, and up 31% year-on-year.
- GAAP gross margin was 45.8%, compared to 45.6% in the prior quarter, and 57.8% in the year-ago quarter.
- GAAP operating expenses were $57.8 million in the fourth quarter 2017, or 51% of net revenue, compared to $62.5 million in the prior quarter, and $42.1 million in the year-ago quarter.
- GAAP loss from operations was 5% of revenue, compared to loss from operations of 9% in the prior quarter, and income from operations of 10% in the year-ago quarter.
- Net cash flow provided by operating activities of $21.7 million, compared to cash flow provided by operations of $37.7 million in the prior quarter and cash flow provided by operating activities of $27.6 million in the year-ago quarter.
- GAAP pre-tax losses were 9% of revenue, compared to pre-tax losses that were 14% of revenue in the prior quarter, and pre-tax income that was 10% of revenue in the year-ago quarter.
- GAAP income tax provision was 85% of pre-tax loss, including approximately $16.5 million of income tax expense for the recently enacted Tax Cuts and Jobs Act, or Tax Act, primarily associated with reducing the federal tax rate on certain deferred tax assets from 35% to 21%, compared to an income tax benefit of 41% of pre-tax loss in the prior quarter, and income tax provision of 3% of pre-tax income in the year-ago quarter. Excluding the effects of the Tax Act, we would have recorded a tax benefit of approximately 72% of the pre-tax loss for the quarter.
- GAAP net loss was $19.4 million, compared to net loss of $9.2 million in the prior quarter, and net income of $8.3 million in the year-ago quarter.
- GAAP diluted loss per share was $0.29, compared to loss per share of $0.14 in the prior quarter, and earnings per share of $0.12 in the year-ago quarter.