MaxLinear Goes Negative

Seth Jayson, The Motley Fool
Updated

MaxLinear (NYS: MXL) reported earnings on Feb. 7. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), MaxLinear beat expectations on revenues and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share dropped to a loss.

Margins shrank across the board.

Revenue details
MaxLinear notched revenue of $19.3 million. The three analysts polled by S&P Capital IQ expected revenue of $18.7 million. Sales were 22% higher than the prior-year quarter's $15.9 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at -$0.05. The five earnings estimates compiled by S&P Capital IQ forecast -$0.04 per share on the same basis. GAAP EPS were -$0.14 for Q4 against $0.16 per share for the prior-year quarter.

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Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 60.8%, 490 basis points worse than the prior-year quarter. Operating margin was -22.3%, 1,550 basis points worse than the prior-year quarter. Net margin was -24.3%, 6,000 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $19.6 million. On the bottom line, the average EPS estimate is -$0.05.

Next year's average estimate for revenue is $92.3 million. The average EPS estimate is -$0.04.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 19 members out of 24 rating the stock outperform, and five members rating it underperform. Among six CAPS All-Star picks (recommendations by the highest-ranked CAPS members), six give MaxLinear a green thumbs-up, and none give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on MaxLinear is buy, with an average price target of $10.25.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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