MACOM Solutions (MTSI) investor relations material

Executive summary

• Q3 revenue reached $252.1M, up 32.3% year-over-year and 6.9% sequentially, with strong growth across all end markets.

• Adjusted EPS was $0.90 per diluted share; GAAP net income was $36.5M, both up year-over-year and sequentially.

• Ended Q3 with $735.2M in cash and short-term investments, maintaining a net cash position of over $235M.

• Book-to-bill ratio exceeded 1.1, supporting a record backlog and ongoing demand strength.

• Recent acquisitions, including ENGIN-IC and Wolfspeed's RF business, expanded product offerings and contributed to growth.

Financial highlights

• Gross margin was 55.3% for the quarter, up from 53.2% year-over-year; adjusted gross margin was 57.6%.

• Adjusted operating income was $63.5M, up 6.2% sequentially; operating income was $37.7M for the quarter.

• Cash flow from operations was $60.4M for Q3 and $165.7M for nine months, both up year-over-year.

• Inventory increased to $215.4M, with inventory turns rising to 2.0 from 1.9.

• Capital expenditures for Q3 were $8.8M; full-year capex expected at $40M–$45M.

Outlook and guidance

• Q4 revenue expected between $256M and $264M, with adjusted gross margin of 56%–58%.

• Adjusted EPS for Q4 projected at $0.91–$0.95, assuming a 3% non-GAAP tax rate.

• Capital expenditures for Q4 expected between $17M and $23M, including $12M for RTP Fab expansion.

• Expects to pay off $161M in convertible notes over the next three quarters.

• Double-digit top-line growth and higher bottom-line growth targeted for FY26.