Key Points
MaxLinear stock surged more than 80% after the company reported strong Q1 results and raised its full-year guidance.
Hyperscale customers are placing large orders for MaxLinear's next-generation networking products.
Management expects production ramps in late 2026 with accelerated growth in 2027.
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It's usually fair to say that a stock is "skyrocketing" when it's up by double-digit percentages in a single day. MaxLinear (NASDAQ: MXL) took skyrocketing to the next level today, though.
The maker of high-performance chips for wired and wireless networking is up by 82.6% as of this writing, near 11:15 a.m. ET. The stock is trading at levels not seen since the spring of 2022, shortly after its all-time high of $77.07 per share.
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The fuel for MaxLinear's rocket ride was, of course, a heavy serving of optical networking gear to equip artificial intelligence (AI) services in ultra-modern data centers.
A strong quarter and a stellar outlook
Technically speaking, MaxLinear simply reported Q1 2026 results last night. Revenues rose 43% year-over-year to $137.2 million, adjusted earnings increased from $0.19 to $0.22 per diluted share, and both figures edged out analyst estimates by a solid (but not game-changing) margin.
That's far from the whole story, though. MaxLinear is ramping up several next-generation networking products this fall. Hyperscale customers are already placing their orders, building a large backlog that will generate revenues and profits in future quarters. Due to the unexpected order flow, MaxLinear raised its full-year optical data center revenue target from roughly $125 million to $160 million -- a 28% increase. And that's just the ramp-up to even faster growth in 2027. The Keystone optical transceiver and Annapurna copper-based signal retimer are driving massive hyperscaler engagement, and you know that these customers have deep pockets.
"We anticipate production ramps beginning in late 2026 with revenue growth expected to continue strong through 2027 as the next-generation speed and bandwidth cycle unfolds," CEO Kishore Seendripu said on the earnings call. "We are very pleased with the strong start to 2026 and are especially excited by the momentum accelerating in our optical data center business."
Image source: Getty Images.
Three years of recovery in one morning
MaxLinear's stock chart just did three years of healing in a single morning. The stock is trading at 12 times trailing sales right now, but it's expensive for a reason. If the optical networking ramp delivers as promised, today's jump might look like the opening act rather than the finale.
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Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
