Participants

Leslie Green; IR Contact Officer; Maxlinear Inc

Kishore Seendripu; Chairman of the Board, President, Chief Executive Officer; Maxlinear Inc

Steven Litchfield; Chief Financial Officer, Chief Corporate Strategy Officer; Maxlinear Inc

Christopher Rolland; Analyst; Susquehanna International Group

David Williams; Analyst; Benchmark Company

Jeremy Kwan; Analyst; Stifel

Quinn Bolton; Analyst; Needham & Company Inc

Ananda Baruah; Analyst; Loop Capital Markets

Richard Shannon; Analyst; Craig Howes

Suji Desilva; Analyst; ROTH Capital Partners

Tim Savageaux; Analyst; Northland Securities

Karl Ackerman; Analyst; BNP Paribas

Tore Svanberg; Analyst; Stifel

Presentation

Operator

Greetings and welcome to the MaxLinear first quarter 2025 earnings call. At this time, all participants are on a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. It's now my pleasure to introduce Leslie Green, Investor Relations. Please go ahead.

Leslie Green

Thank you, Joe. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss MaxLinear's first quarter, 2025 financial results. Today's call is being hosted by Dr. Kishore Seendripu, CEO; and Steven Litchfield, Chief Financial Officer and Chief Corporate Strategy Officer.
After our prepared comments, we will take your questions. Our comments today forward-looking statements within the meaning of applicable securities laws, including statements relating to our guidance for the second quarter of 2025, including revenue, GAAP and non-GAAP gross margin, GAAP and non-GAAP operating expenses, GAAP and non-GAAP interest and other expense, GAAP and non-GAAP income tax, and GAAP and non-GAAP diluted share count.
In addition, we will make forward-looking statements relating to trends, opportunities, execution of our business plan, and potential growth and uncertainties in various product and geographic markets, including without limitation, statements concerning the future financial and Operating results, opportunities for revenue and market share across our target markets, new products, including the timing of production and launches of such products, demand for an adoption of certain technologies, and our total addressable market.
These forward-looking statements involve substantial risks and uncertainties, including risks outlined in our risk factors section of our recent SEC filings, including our Form 10-Q for the quarter ended March 31, 2025, which we filed today. Any forward-looking statements are made as of today, and MaxLinear has no obligation to update or revise any forward-looking statements.
The first quarter 2025 earnings release is available in the investor relations section of our website at maxlinear.com. In addition, we will report certain historical financial metrics, including but not limited to gross margin, operating margin, operating expense, and interest in other expense on both a GAAP and non-GAAP basis.
We encourage investors to review the detailed reconciliation of our GAAP to non-GAAP presentations and the press release available on our website. We do not provide a reconciliation of non-GAAP guidance for future periods because of the inherent uncertainty associated with our ability to project certain future changes, including stock-based compensation and its related tax effects, as well as potential impairments.
Non-GAAP financial measures discussed today are not meant to be considered in isolation or as a substitute for comparable GAAP measures. We are providing this information because management believes it is useful to investors as it reflects how management measures our business. Lastly, this call is also being webcast and a replay will be available on our website for two weeks.
And now let me turn the call over to Dr. Kishore Seendripu, CEO of MaxLinear.

Kishore Seendripu

Thank you, Leslie, and good afternoon, everyone. Our Q1 results. Reflect the continued growth and recovery of our business. We exceeded the midpoint of our guidance with $95.9 million in revenue, non-GAAP gross margin of 59.1%, and a meaningful reduction in operating expenses. We not only expect to be profitable on a non-GAAP basis in Q2, but also most importantly, to be able to generate positive free cash flow in Q2.
In total, in Q1, we made strong progress towards our return to profitability and our solidly executing with new product wins in high-speed data center interconnects. Phone, WiFi, and Ethernet. We're also seeing meaningful improvement in our customer order rates and backlog, which give us confidence that we can continue to deliver growth in 2025 and '26.
Now looking at our key markets in infrastructure, the increasing demand for high-speed data is driving significant growth and design activity around high-speed interconnects in data centers, cloud infrastructure, and next generation telecom networks. We continue to make strong progress with product calls across multiple customers for our fine nanometer Keystone PAM4 DSPs Product.
At the optical fiber conference, we demonstrated nearly a dozen Keystone powered optical and Active electrical cable modules for OSFP switches. We also highlighted a reverse gearbox application using Keystone from one of the world's leading module makers, as well as a half free timed active electrical cable wide cable solution, also using Keystone. Our products were featured in demos at the booths of several partners which are in various forms of production or qualification stages.
We are also pleased to showcase a live demo of our Rushmore 1.6 terabit 200 gigabit per lane PAM4 DSP. Like Keystone, a Rushmore family of PAM4 [TIAs] and DSPs for 1.6 terabit interconnections offers superior power and performance advantages. This continues the basis of our competitive differentiation and design in success.
We anticipate additional qualification and rollout for 800 gigabytes and 1.6 terabyte data center applications throughout '25 with exciting revenue growth in 2026. In wireless infrastructure at the Mobile World Congress, we demonstrated a highly integrated Sierra Radio system on chip as a complete open ran macro radiate unit solution.
It seamlessly interoperated with all major GA power amplifier suppliers utilizing maxinus proprietary digital bridge distortion technology. Our wireless 5 -- 5G access single chip radio SOC's and our millimeter wave and microwave backhaul transceivers and modems are essential for supporting increasing mobile usage and data rates, as well as new functionalities such as edge AI.
We believe we are positioned strongly for content growth and share gains this year as service provider capital expenses improves and as our continued design means at T1 customers begin to ramp later this year.
Also within our infrastructure revenues, our panther family of hardware storage accelerator SOC's is strongly positioned within the data center, enterprise storage applications, and the edge of the network with multiple designs with major customers and value-added resellers across key geographies.
It enables optimized cost, power, performance, and efficiency of storage and compute server systems by offloading complex tasks that otherwise require long and costly CPU cycles to execute in software. It provides unique and best in class capabilities around data compression, integrity, and security with support for 200 gigabits per second throughput and the lowest latncies essential for AI applications.
Shifting to broadband and WiFi connectivity in the near term, we feel increasingly confident in the ongoing recovery of the broadband and connectivity markets. Now, with several quarters of improvement behind us, we're excited to begin the ramp of our single chip integrated fiber PON and 10-gigabit processor gateway SOC plus triband WiFi 7 single chip platform solution with the second major tier North American carrier later this year. This is both a major win and a significant validation of our technology and competitive positioning in the fiber PON market.
We expect that it will drive meaningful growth for our fiber revenues in 2026 and give us a strong foothold to continue to expand our presence in PON. Overall, bookings have continued to strengthen and we are seeing incremental growth in demand for our cable data boxes products, as well as our WiFi and Ethernet solutions.
With a broad portfolio of newly refreshed products ramping into this market. And a healthier demand environment, we expect continued growth in these categories throughout the balance of the year.
In conclusion, we view Q2 and 2025 as a year of strong growth and return to profitability transition as we begin to drive growth in strategic areas of our product portfolio and enjoy the incremental tailwind of the ongoing recovery in our core markets. Investments made in high-value categories such as high-speed interconnect for the data center, multi-gigabit PON access. WiFi connectivity, Ethernet storage accelerators, and wireless infrastructure are resulting in strong product traction with TF1 customers and partners.
We believe these positions as well to accelerate our growth as these markets continue to gain traction in 2026. With that, let me turn the call over to Steven Litchfield, our Chief Financial Officer and Chief Corporate Strategy Officer. Steven.

Steven Litchfield

Thank you, Kishore. Total revenue for the first quarter was $95.9 million, up from $92.2 million in the previous quarter. Infrastructure revenue for the first quarter was approximately $27 million. Broadband revenue was approximately $41 million. Connectivity revenue was $20 million, and our industrial multi-market revenue was $8 million. GAAP and non-GAAP gross margin for the first quarter were approximately 56.1% and 59.1% of revenue.
The delta between GAAP and non-GAAP gross margin in the first quarter was primarily driven by $2.6 million of acquisition-related intangible asset amortization. First quarter GAAP operating expenses were $99.9 million, and non-GAAP operating expenses were $58.4 million. The delta between GAAP and non-GAAP operating expenses was primarily due to stock-based compensation and performance-based equity accruals of $28.9 million combined, restructuring cost of $7.9 million and acquisition-related cost of $3.2 million.
GAAP and non-GAAP loss from operations for Q1 2025 was 48% and 2% of net revenue. GAAP and non-GAAP interest and other expense during the quarter was $2.9 million and $2.7 million respectively. In Q1, cash flow used in operating activities was approximately $11.4 million. We exited Q1 of 2025 ahead of plan, with approximately $104 million in cash equivalents, and restricted cash.
With the overall improvement of our business, we expect that in Q2, we will have positive operating cash flow and thus begin to generate cash again. Our day sales outstanding was approximately 94 days in Q1. Our gross inventory was down versus the previous quarter by approximately $4.3 million as we continue to make improvements with inventory turns at 1.3%. This concludes the discussion of our Q1 financial results.
Before providing our guidance for Q2, I'd like to comment on the tariff situation and the geopolitical dynamics around semiconductors. As you are all aware, the market has a tremendous amount of uncertainty with regards to the trade environment. We are working closely with customers to address the changing landscape and have taken the current environment into consideration with our guidance.
It's important to acknowledge though that the guidelines are still evolving, so it's difficult to know exactly how the demand drivers will play out for the quarter and for the rest of the year. With that, let's turn to our guidance. For Q2 of 2025, we currently expect revenue in the second quarter of 2025 to be between $95 million and $115 million.
Looking at Q2 by end market, we expect all in markets infrastructure, broadband connectivity, and industrial multi-market to be up in the quarter. We expect second quarter GAAP gross margin to be approximately 54.5% to 57.5%, and non-GAAP gross margin to be in the range of 57.5% and 60.5% of revenue.
We expect Q2 2025 GAAP operating expenses to be in the range of $92 million to $98 million. We expect Q2 2025 non-GAAP operating expenses to be in the range of $55 million to $61 million.
We expect our Q2 GAAP and non-GAAP interest and other expense, each to be in the range of $2 million to $3 million. We expect a $2.4 million tax expense on a GAAP basis and non-GAAP tax rate of 10.5%. We expect our Q2 GAAP and non-GAAP diluted share count to be approximately $87.0 million to 87.5 million.
In closing, another quarter of improvement in customer orders and continued new product traction gives us confidence that we will continue to see growth and recovery in 2025 and beyond. We're excited that our innovation and our investment in strategic applications such as optical high-speed interconnects, wireless infrastructure, storage, Ethernet, WiFi, and fiber pond gateways are beginning to deliver new and transformative business opportunities.
Our continued growth coupled with our strong focus on operational efficiency is positioning us for a sustainable return to profitability and cash generation this quarter.
With that, I'd like to open up the call for questions.

Question and Answer Session

Operator

(Operator Instructions) Christopher Rolland, Susquehanna International Group.

Christopher Rolland

Hey guys, thank you so much for the question. And, I guess, just as we all care about tariffs right now, I'll ask on the supply chain and I understand the uncertainty, but if you could perhaps walk us through some of the risks that you see, in your own, but also your customers supply chain.
Like, for example, I believe a lot of like broadband equipment is manufactured in China. How transferable would this be to other geographies? Just generally, if you could give us a sense of these risks, how these risks could be mitigated and if there's anything that kinda keeps you guys up at night, thanks.

Steven Litchfield

Yeah, Chris, thanks for the question, and there's plenty keeping us up at night right now. So I mean just maybe to start with, look, we don't have a lot of real direct impact, right? I mean, superconductors are not included here, so we're not seeing direct tariffs. So our supply chain actually is pretty good, so we feel pretty good about that.
Your second part of your question kind of alluded to the customers. I think where we're Just watching closely is what's customer demand look like. Does that, how do the tariffs kind of get transferred to the consumer? Ultimately, does that slow demand? So we're watching that, I guess in between all of that, the, watching the ODMs and OEMs and how they're navigating this environment.
You mentioned that China is a bigger kind of box manufacturing broadband. That's a whole lot less true today than it was five years ago five years ago we saw some impacts here. Most of those those customers have moved out of China, so we actually see less of a risk around that. But as there's tariffs that are being proposed on all the countries.
I think the one that everyone seems to be circling around is China having the biggest. Impact, and so that's the one that we're watching closely. It seems like a lot of the other ones, hopefully, will be reduced a little bit and have less of an impact at least on our ecosystem anyway. Thank you, Steve. Yeah, no, I see that on our --

Kishore Seendripu

Hey, Chris, I would say that. None of our broadband CP customers make any boxes in China for our customers, so I can say that not almost, it's all of them. So we are safe from a China manufacturing perspective. We don't have any exposure there. But more importantly, I think our bookings have been pretty strong, even let's say, so we look at it in two buckets.
The craziness that may come later versus what was let's say two weeks ago, and our bookings have been very strong. We've been taking bookings even into Q3, Q4, so we're seeing a nice recovery that's now been going on for several quarters on our broadband business.
So I would put it in two categories in terms of what is the true demand versus what is the supply chain driven yanking, whether it's in an accelerated demand versus maybe a delayed demand. We see both sides of it. So but from our perspective with our lead times for manufacturing being anywhere between 16 to 20 weeks.
Any gyrations that come from the 90 day tariff pause is not going to have any effect on our ability to supply chips in an accelerated manner or a decelerated manner. That's, we're well past that.

Christopher Rolland

Great, thank you guys and I also just as you brought up bookings Keyshore, I was just wondering, it was great that you think everything's going to be up next quarter, but if you look at bookings, if you look at that order book, if you take a guess and maybe you can fill us in in those inventory situations for and market. Could you force rank those segments for us, into the next quarter?

Kishore Seendripu

I think in general our problem is very different from the ones who have been enjoying the demand in the data center for some time now, right? We are recovering from what was a 2022 peak consumption of a product, specifically broadband and telecom markets.
So that depletion is is almost fully set in now, and that's where we're seeing where we think the channel inventories are lower than they should be. So we have been seeing strong bookings from Q4 onwards, even in Q3 last year. And we are actually now taking bookings for Q3, Q4. So I believe that the channel inventory shows that may develop, because of for some of the customers are not necessarily particular to the issues we faced in the previous two years, so we are pretty much right now in a filling pattern rather than waiting to deplete pattern.

Christopher Rolland

Okay. Did you see any strength, one segment versus the other?

Kishore Seendripu

Actually, we're seeing, generally a broad-based strengthening of demand, except we are seeing some weakness in our industrial markets that is in China that has got China exposure, from an end demand perspective, but otherwise we are feeling pretty positive that we will continue to grow strongly for the rest of the year and beyond.

Christopher Rolland

Great. Thank you so much for the update, guys. Appreciate.

Steven Litchfield

Yes. Thanks, Chris.

Operator

David Williams, Benchmark Company.

David Williams

Hey, good afternoon. Thanks for taking my questions and congrats on the stabilization and the the positive outlook here. So my first question is maybe Keish where you pointed to the design win progress on the DSP side for Keystone and that continued through the quarter.
Can you help us try to understand the magnitude of maybe that progress and and where you are in terms of the design winds and maybe that ramp as you think about the next maybe 6 to 12 months.

Kishore Seendripu

So David, thank you. We're feeling very positive finally, right? When you reach there it's only when, then you can sort of, exhale. So we're very happy that we are expecting to break even in Q2 and turn cash flow positive as well. It's a major milestone given what's happened in the last few quarters, right?
So that's the good news. And we think that the rest of the year we will keep generating positive cash flow. So moving to the data center at the op optical fiber conference, and we displayed about 20 designs on display that are done in our in our booth, and their partners are showing that they were all actually Keystone based and we had four demonstrations of evaluation platforms for a Rushmore design.
So if you look at those 20 designs, that's one way to look at all those 20 designs that are in various stages of qualification, and I think Steve is already guided in the last earnings call that we would land somewhere between $50 million to $80 million. I think specifically said $60 million to $70 million which would be a doubling of last year's revenue. So I would say, given how long it takes to qualify in this market.
And because it's a pretty highly demanding market, it's a pretty complex product even though you call it the OSFP, so the fact that we can double our revenue is proof that the quality of our designs and the caliber of our customers is quite different from last year, otherwise you won't be able to double your revenue.
So we feel very good and that leads to the leads to my own sort of, musings. What does next year look like? Obviously we hope that if the calls all good in a nice way, can be doubled from here in 2026, but that will require some key calls to complete, and they're all slated for the second half of this year, and we expect all the revenue next year actually coming from Keystone for a while.
Okay, I hope that's helpful.

David Williams

Oh fantastic color thanks thanks so much there and then maybe just secondly on the North American that second tier one, it sounds like you're expecting that kind of ramp at the back end of the year and then more fully next year. Can you kind of talk maybe size the magnitude of that and and how we should think about that ramp, going forward? Thanks.

Kishore Seendripu

So I think you're talking about broadband porn, tier one operator in North America. Yes, I mean, we're pretty excited. We were the first ones to be selected for the new category of high-end boxes against what what you all know is a pretty vicious competition, right? And so it'll be a nice anchor that adds to our other tier one operator in North America for the gateway design, but this clearly is a bigger player, so we're very excited about it.
And I think one of these guys ramp will be shipped a few quantities. They have this year towards the end of the year for sure, of course. But next year would be the ramp and hopefully we're the first ones to ramp before the second supplier comes online, and we seem to have a good lead on that, so we should enjoy significant growth.
So if you think of our parevenue today as I'm in the $50 million range, next year, can you double overall? Absolutely. That's the goal here.

David Williams

Thank you so much.

Operator

Jeremy Kwan, Stifel.

Jeremy Kwan

Yes, good afternoon, and let me have my congratulations on, the recovery here. I guess, maybe asking the end market question, just on a longer term basis, it looks like you're seeing some nice recovery in broadband and connectivity, infrastructure, it's, it looks like it's going to be a nice growth driver. Would you Can you rank order those for us, maybe as we look out the calendar '26. In terms of a growth contribution.

Kishore Seendripu

So let me, maybe Steve can answer those sort of corner questions a little bit better than I can, but I would just say that infrastructure has clearly been the focus of massive investment for us. It's strategically important because I look at infrastructure is a very core American market, right? If you really look at it, there are two markets that that are the biggest ones.
One is the enterprise infrastructure market, which is now primarily the cloud market. The other one is the consumer market, and we are not a consumer products company. So for us, being in the infrastructure market is a strategic imperative, and it drives a lot of differentiation, and gross marginal improvement for the company. So I would think that the infrastructure would be the most exciting growth on a new product cycle basis, right?
What you will see in broadband is some level of pretty rapid recovery. I'm talking of, I'm not going to comment on tariffs here, right? I'll just leave that aside, if you just look at it in a secular term, there'll be there'll be a strong growth driven by recovery in the code market and a pretty decent team sort of growth from new product cycles.
I think that's a pretty healthy product and then, you add to that what's happening in, the new product like porn, we talked about, I gave the size of it. These are pretty cable also we should start seeing some outside of pa in the cable doses data market. So networks are being still being upgraded. There's a lot of demand for increasing their competitive position against PON.
And I think for us, broadband actually is kind of exciting though data center and infrastructure are kind of a strategic imperative on wireless infras lot of good things are happening. Actually, we have very strong growth in '26 on the back of our Sierra product access market. We will start pivoting towards being maybe one of the top silicon providers, as a merchant silicon providers.
So, yeah, I would say infrastructure, broadband would be the new product cycle growth, and then you have, we'll have some other new product cycle growths, but it won't be as exciting in the industrial markets because the market is up and down in some areas. So those two would be rank pretty high.

Jeremy Kwan

Great, thank you. And I guess, just, maybe digging a little deeper into the storage accelerating market, it sounds like, that's finally, close to contribution. Can you give us an idea of maybe what are, some of the key applications, any sense of how many, customers you can talk about, just quantity wise. This more enterprise, or is it more data center, any code you can provide would be very helpful.

Kishore Seendripu

So, at the end of the day, even if it's enterprise, I just want to make sure that they're selling these boxes to the storage appliance server compute server boxes. They're all ending up in some form of AI edge data center or in the data center. Having said that, we have 20-odd proof of concepts going on, right?
And the revenue we talk about, somewhere between $10 million to $20 million in 2025 is driven by enterprise storage today and some royalty software license revenues as well, because we also have a Sort of a paired offering on the store using a superior algorithms for better compression storage in the traditional systems.
And then we have these compute servers that are being, that are actually are being demonstrated, right? We have the Atlanta Supercomputer conference where we demonstrated with QCT which is a major, compute server manufacturer there, they use storage compression. But the key point is, why do they need it?
It's not just about compression and security for reducing the amount of storage space is actually a wrap, a very powerful enabling capability where we reduce the latency of compute by really having a very low latency storage with very high density compression.
So what that does is when you look, think about AI type applications, whether it is Inside the data center or outside the data center, it becomes very critical not to have bottlenecks in the, whether it's the training or infrared systems. So I think at this point, to be H1 with you, we are revenues are coming from.
Enterprise, which is basically storage appliances and compute servers. However, we we we have a lot of strong traction after our reference platform announcement with AMD, a joint development platform, so we're getting a lot of attraction in the other non-enterprise markets as well.
So I think if you just fast forward this year $10 million to $20 million can it double or triple next year? Absolutely. Because once you're qualified, it just takes off and then the fall. So I had told a year ago that in three to three years, we should see based on enterprise storage alone somewhere there.
Picking out at maybe $75 million revenue, I said $50 million to $75 million. I think, yes, it's delayed a little bit, but nothing beyond what we had forecast. I think we should be able to hit that benchmark purely of enterprise storage. Now, if we were to get one or two calls on the compute compute side, I think this could easily be a 2x on that in a five to seven year window. So very nice, differentiated product that nobody else having such an offering in the world.

Jeremy Kwan

Okay. Perfect. Thank you very much.

Operator

Quinn Bolton, Needham & Company.

Quinn Bolton

Hey guys. We wanted to come back just to a couple of clarifications on tariffs. One, you mentioned none of the CPE boxes manufactured in China, but my guess is there are probably a number of them manufactured elsewhere in Southeast Asia where there are, reciprocal tariffs. I know those been paused for 90 days, but to the extent that those aren't totally taken away, would you expect some greater tariff effect possibly in the second half of the year.
And then the second clarification is you guys manufacture everything overseas, right? So there's no reciprocal tariffs for any semiconductor chips you ship into China, whether it's consumed in China or whether it's re-exported, right, so no tariff costs on your products to the extent that they flow through China.

Steven Litchfield

That's correct, Quinn. With regard to the first part of your question. Yeah, I mean, all of the other Southeast. Asia countries where a lot of these boxes are manufactured are at least currently planned to be subject to these tariffs, right? And I think this is the part that there's plenty of uncertainty in trying to figure out, how things move around, right, and what the ODMs and OEMs kind of decide to do on this front.
And we don't have 100% clarity. It's all pretty new right now and so this is where I mentioned, kind of working with the customers trying to help them, get those boxes kind of through the whole tariff malaise, if you will, and that's what we're doing right now.

Kishore Seendripu

Look, all our, if you if you really step back a little bit. The broadband CPs have been Sort of tired offerings for the last two or three years because of the excess inventory in the system, but now they're transition, transitioning in new generation boxes whether it's 10-gigabit pa and so on and so forth.
So my surmise is that is that these are needed to be competitive offerings and that's where the applications are going on. And I think while I cannot, I'm not a macroeconomist, but I think that the demand is the demand, and then, the prices will be adjusted within the supply chains here.
And but I don't think the demand goes away because I think broadband is a very inelastic market. What makes it boring and what exciting from it depends on which viewpoint you take. And so I feel very comfortable that we will be able to, continue to grow in broadband.

Quinn Bolton

Got it. And then, maybe just, given all of this uncertainty, can you give us a sense like how you approached guidance in this like, is the $$105 million mid-point? Did you kind of say, hey, we're going to take our forecast, judge it down and Came up with 105 million at the midpointers $105 million kind of where you think things fall and then you just broadened out the range given the uncertainty, just any any sort of sense, how you might have accounted for this tariff uncertainty in the guidance and then I do have one business question if I could squeeze in a third.

Steven Litchfield

Yeah, Quinn, look, I think I covered this in the prepared remarks. Yeah, we've done our best to anticipate the tariffs that we have in front of us, and that's what we based our guidance on. What was your other question?

Quinn Bolton

The other question, just I think last quarter you talked about, some variability in the optical DSP ramp depending on the timing of hyperscalar 800 gig ramps in the second half of 2025, wondering, as you sit here today, how are you feeling about timing of those 800-gig ramps. Are you feeling better that those hit in 2025? Is there still some uncertainty on when those 8000gig deployments at the hyperscalers start to kick in?

Steven Litchfield

So I think you covered this in his question. I mean, we've had a guidance of $60 million to $70 million. I think we stand by that. We're comfortable with that, as you're well aware. I mean, most of those 800 gig ramps are in the second half of the year, so that's also consistent with the way we've talked about them, and I think we're completely comfortable with that.

Quinn Bolton

Okay, great. Thank you.

Steven Litchfield

Good, thank you.

Operator

Ananda Barua, Loop Capital Markets.

Ananda Baruah

Hey guys, good afternoon, thanks for taking the question and I really appreciate it. Yeah, good to talk to you guys I guess Kishore and Steve, you may this may be implied in all the comments you guys have already made about demand environment, but let me also just ask it this way to make sure I cover the bases here. So it sounds like Keyshore, no macro, no signs of macro impact yet. In your order book and let me also ask, do you think you're seeing any pull forward? Revenue, it doesn't sound like it, but let me ask that question as well.

Kishore Seendripu

Thanks. I was wondering when that question was going to come of the pull forward. It looks like COVID? No, not really. Yeah, okay, we are pretty early in our earnings call in that 90 day window pause announcement a few days ago, right? So the reaction time it will take a little longer. So if ads and bookings spike up, let's say this week or next week, some people have talked about it, and we talked to colleagues in the industry, we will take them with more than a grain of salt, let's put it that way, and we will try to be measured about it.
But I want to repeat again that our lead time for chips is about 16 to 20 weeks. There is nothing you can do in the 90 days that's going to change our ability to ship product. So it will, we will not be able to mobilize even if they were to spike orders on us. So that's the reality.

Steven Litchfield

And I just maybe echo, I'll just echo the overall demand. I mean, because, yeah, the world's kind of been turned upside down in the last two weeks, but I really want to echo the last quarter or two or three quarters for that matter. Continue to seeing, improvements, right?
That's the recovery that we both talked about a little bit earlier in the prepared remarks. That backlog has continued to improve. The bookings have continued to improve for six quarters now. And so, a lot of encouraging signs on the new products as well as existing products.

Ananda Baruah

That's super helpful and and I guess just my quick follow up on the demand side is keep your your comments about data center it it makes it sounds like this all applies to data center as well and the data centers are I'm paraphrasing here you say full speed ahead and maybe I'm making that up but I thought there was some comment about data center energy spend and AWS and Google have come out in the last couple weeks and reaffirmed spending plans vertive this morning was like super bullish, not just for hyperscale but for neo clouds and colos. So I just want to just you sort of clarify that as well. Sounds like you're seeing no change in activity in the data center space either. Is that accurate?

Kishore Seendripu

For us, it's all, it's still about digging, right? Knitting the products together, so to speak, right, qualifying and that sort of work, right? So we don't have the levels of, incumbency that where the dialogue is very different. So I think at this point, no change for us, how we have to go about our actions. So I really cannot comment on what a large incumbent exposures mean to this situation.

Ananda Baruah

I got it that's helpful. I appreciate it thanks guys.

Kishore Seendripu

Yes, thanks Ananda.

Operator

Richard Shannon, Craig Hower.

Richard Shannon

Thanks guys for taking my questions. You'll ask one on the wireless infrastructure side, Kishore, I think you've mentioned this briefly here. We'd love to get a sense of your confidence of the ramp up here later this year. Maybe you can talk to the extent to which you see the revenue growth coming more from the content side or also from the unit side as.

Kishore Seendripu

Well absolutely. If you look at it, up until now, our revenues were primarily, consisted of two parts to our wireless infrastructure, right? One is millimeter wave, microwave, backhaul transceivers and modems. And last year, the, and this year, sort of, suddenly, not last this year, the revenues came really down because the telco stopped spending because, but however, we are now, seeing bookings picking up very nicely, strengthening, and, we hope to double from what we did last year.
On that product line alone. But in addition, the axis, we have a CR product where the content in the platform is going to increase quite a bit. It's a single chip macro radio unit. There is a very good customer design with traction, in Mobile World Congress. We had so much, sort of presence and traction in terms of all the things we were showcasing. So we expect there to be a strong driver next year as it starts picking up this year.
So, and that's a brand new platform where it's a single we own the platform just like in in the microwave and back backgrounds we expect revenues to access to continue to grow for the next five to six years. On the back wall side, there's a lot of strong demand now for eban that means that these AI edge applications are driving more and more data requirements.
And so we're seeing demand for millimeter wave, products which do not exist in the previous revenues. So we are actually seeing strong growth in the millimeter wave transceivers and backhaul modems. So those two would be the big drivers of growth. On top of that, we expect a recovery of the normal core business as well. So right, so that with the layering of it.
So you will see a strong revenue growth coming from just recovery and then product cycles, secular growth over the next few years by content growth, both millimeter wave, microwave modems and transceivers, and also the brand new category of single chip, macro platform -- type product for the base stations.

Richard Shannon

Okay, and Kishore, if I could just confirm one of your comments here, I think you said doubling from last year alone. I don't know if that was a comment across the whole wireless exposure or something specific. Can you clarify that, please?

Kishore Seendripu

Yes, it's caused the whole wireless exposure.

Richard Shannon

Got it. Okay, perfect. My follow-on question is related optical DSP here. I guess I wanted to get a sense of when and how do you expect to get in and look for, higher allocations of share with your Keystone platform and or to what degree do you see that success there happening and also being applied to Rushmore as well.

Kishore Seendripu

Very good question. But let me 1st answer the Rushmore scenario. Look, we are not the first one with the Rushmore product, but our general competitive, anchor is extremely low power and superior performance, right? That's the focus on. And it's just the way the the cycle plays out, right? But the only customer who is deploying the 1.6 terabit platform is in media, and they have made their choices.
So if any opportunities come, they'll have to come later on, then they actually start shipping reasonable volumes, right? Now the volume is not that much. And then they need a third supplier, right, just to divest with the chain. So our entire premise is anchored on really penetration on the non-Nvidia type market.
And those ramps won't happen until the latter half of next year. I'm sure there are some that are happening now, but our product will really be the end of '26 revenues on the 1.6 more product.
We showcase and demote, we'll have to do evaluation sampling to customers, and then they are qualified to production, and then, the in qualification and so on. So it's a bit of a drain there, where to get through. So the revenue banking is really on our Keystone product which is the 400 gigabit per second application, 800 gigabit per second applications.
And there, where the US is going to more and more transition to 800 gigabits per second, you have the China Hyperscalars sort of more really transitioning heavily to 400 gigabits per second and later to 800 gigabits per second.
So the way we think about these markets over the next five years, about 70% of the market would be the 800 gigabit category, and the 30% of the market would be the 1.6 terabit category. So, from an allocation perspective, we expect that over the course of time, We expect and plan the business to be about 20% of the market.
And that's all we get over the next three or four years about. So anywhere between $200 million to, we're given a range of outcomes somewhere between, let's call it $200 million to $300 million revenue, that's the business plan, okay? And with regard to 1.6 terabyte is a continuation of credibility and our commitment to the market investment. The Keystone will be the bigger anchor of revenues in the near to mid-term.

Richard Shannon

Appreciate all the detail Kishore. Thank you.

Operator

Suji desilva, ROTH Capital.

Suji Desilva

Hi Kishore. Hi Steve. Maybe Kishore, same question as Richard asked a few questions ago on the broadband side. Is there a content gain a booster to the unit recovery or growth you're seeing in broadband from Maxlinear?

Kishore Seendripu

Very good question. I think the prepared remarks, I don't know if you mentioned this or not, but all the new product revenue cycles are based on bomb expansion. And here is the, where the bomb expands. Firstly, the pa, the pawn world is transitioning to XGS pawn, right? And then, that means you have a head tier processor, you have a more bulky modern.
And then there's a WiFi that goes with it is WiFi 7, it's no longer WiFi 6, right? So on the cable side, the new product cycles are driven by doxes 4.0, more precisely ultraoxxes, right? That's going to be the real driver more than FDX dox is 4.0. Yes, they'd be delayed from 2025 to 2026 due to network upgrades and making sure everything is fine, but that would drive the content increase as well.
And then, in these platforms, whether it's a modem or a gateway, you get content expansion even on the ethernet side, right? Because all of these are ports for Ethernet, we offer multi-ports multi-gigabit, multi-port 2.5 gigabit Ethernet and gigabit Ethernet five solutions and squat port or a dual port and so on.
And then, you also add to the to the fact that all of these require higher upgraded sort of, capability to support so much content for power efficiency and so on and so forth. So all new product cycles are content expansion and the core recovery in the market is going to be driven by incumbent solutions if you call them legacy.
So be it, where WiFi 6 and docs is 3.1 and 2.5 gigabit pa are the prevailing solutions, okay. So a 30% bomb expansion on legacy platforms as the transition is the normal metric we use for bomb expansion.

Suji Desilva

Okay, the putting a number on it. And then question for Steve, your two guides for expenses kind of reflect some of the the cost efforts. Is the 2Q levels or the new baseline to go forward, or are there more, cost restructuring benefits that would flow through the second half before we get to a new level?

Steven Litchfield

Yeah, so I think we've made some great, kind of post some of the announcements that we made in Q3 of last year. So as projects kind of ramp down, then you've seen us come down. So I do think there's a little bit further to go where we'll see kind of another step down in the back half of the year on the OpEx.

Suji Desilva

Okay great thanks thanks guys.

Operator

Tim Savageaux, Northland Capital Markets.

Tim Savageaux

Hey, good afternoon. There a couple of questions to start with just about moving parts within segments in Q1. Broadband came in much better than expected, up nearly 40% sequential. And I wonder if there are any particular drivers there on either the pawn or cable side for that upside, and then I'll follow up.

Steven Litchfield

Yeah, I wouldn't, you're right to point out it was up a little more than what we'd expected, kind of had seen this coming for a while and so you're kind of seeing a follow through. It was particularly high for kind of a typically seasonal Q1 in broadband, so it was up quite a bit more. It was kind of across the board, H1 and because I think he sure mentioned this previously, but like some of the bigger pond ones really don't even ramp till late this year or next year, so some of the the newer PON stuff is still to come, but so it's mostly across the board.

Tim Savageaux

Okay, sounds like cable. That's what I'll take away on that. And similar question on the infrastructure side where you were flat on the quarter, And I know you had a big Q4 on the AI kind of optical side. I don't know whether that might have backed off a little bit, and you saw growth elsewhere, but looking for color there. And at this point, I'm assuming that your AI optical chip business is more than half of infrastructure revenue. In Q1 at least.

Steven Litchfield

So I mean just I guess the only color around infrastructure in the quarter, I mean, as I mean optical will grow quite a bit this year and and start to be a more meaningful percentage of the infrastructure business that's on track. I think that performed as expected in the quarter, we've been talking about wireless a little bit today.
That's the piece that, it's still kind of recovering, and I would expect to see more growth of that growth out of that in the second half of the year than say we saw in the first quarter.

Tim Savageaux

Okay, thanks. Onward and upward. To the final question, and that's, you mentioned OFC. You had a a lot of modules running in a lot of places with your chips in them. I think in your booth, guys who are potentially facing some really high volumes, like applied opto and currently seeing them like coherent. Jabel seemed to have a pretty good show cisco is talking more about client optics. I mean, as you look at this group. I guess, how concentrated or not would you expect?
Your your AI optical revenue to be, this year going out into next year and should we look at it as fairly broad-based, or do you have a couple of really important design wins and you have some guys in China too that that we should be thinking of thinking of as as key drivers for the business.

Kishore Seendripu

Look, I mean, if you just round up the data center module makers. There are five big ones, right? And if you do not have. Have them, all of them or at least the majority of them. There is no way you can build up your revenue. So by definition you have concentration, and the remaining five will be there to sort of do the other 30% of your revenues, let's call it that, right?
So I think with the size of these revenues you should expect a two-third, one-third spread. Now this is a very theoretical notion. So as we build up more customers, usually the way it starts initially all your revenues are.
A bunch of guys, right? This is the way the markets player. Then you get that success and then one big guy comes online, then you get a couple of others, and then from there on, it's, you grow with the market, you grow share and that sort of a thing. I think we play the classic trend.
So I think in the long term you should expect two-third, one-third, two-thirdcoming from two or three players, the remaining one-third coming from a range of players. I think that's the way I would, distribute them.

Tim Savageaux

That's great color, appreciate.

Operator

Karl Ackerman, BNT Paribas.

Karl Ackerman

Yes, thanks, gentlemen. I want to circle back on broadband and connectivity, for sure, I think you indicated that combined business could double next year and just, and then. Steve, you were talking about how the pawn content is in front of you. So if I just tie those two together, is the perhaps doubling or the -- opportunity to double this business next year, is that driven primarily by a cyclical recovery in cable near term, or is that driven by just this growing mix toward fiber paw and perhaps the opportunity you see with, your integrated fiber paw and 10-gig gateway [SLC] have a follow up, please.

Steven Litchfield

Yeah, Karl, I'm sorry, I'm not, I mean, there might have been a miscommunication there because I think he sure was talking about the doubling on the wireless side, not on the broadband side. I mean, with regard to broadband, as we've had more exposure in the cable market, but we're seeing, additional traction with PON.
We spoke with the other big North America guy that we've Closed and that's expected to ramp late this year early next year. So we do expect to see pond revenues ramp, [doxyporo] ramp or 31 ultra, at some point next year, we'll definitely contribute.
And so as we see, I think a broadband kind of you'll see a nice recovery this year and then you're going to see some good follow on growth as we bring on either more customers or more wins or more market share gains in all of our markets.

Karl Ackerman

Got it. Yeah, thank you for the clarification. I want to go back to, bookings and visibility. You spoke earlier how you're not seeing any pull forward related to any, tariff impacts just given the fact that lead times for chips remains in the 16 to 20 week window.
You also spoke about how bookings are growing and perhaps you're seeing bookings extend beyond Q2 and into Q3 and Q4. I was hoping with that backdrop you could give a bit more color on. Whether you're seeing a similar dynamic play out across all in markets and across geographies, and or are you seeing perhaps a larger amount of order visibility, in certain geographies in the markets than others. Thank you.

Kishore Seendripu

So I would say that, it pretty much orders track our growth in revenues, right? They have to at some core level. And when I talk of no spike in demand, I'm just saying it's too fresh last two weeks to really, the 90 day pause or 90 day tariff window to create the spike, right? And even if what we were saying, even if there's a spike, we won't be able to.
Supply that spike in demand. So that's the reality of it. So the bookings that we referred to is we are referring to prior to this tariff vacillations, right? So based on that we're seeing strong bookings because of recovery in our core business that both Steve and I referred to in our script, so.
I think that you shouldn't worry about what if there is a spike, or, what's going to mean for us, right? You don't, so when you look at the markets, the, if you look at our revenues, almost all of our revenues in outside of broadband and data center. Or I would say 80% to 90% outside the US, so the tariffs should not have an impact on that.
But if you look at the revenues in the US, it's broadband and data center. So, that's all I would categorize them. So therefore, we started thing is really primarily a US scenario. And, so I, and then I would categorize it more broadband if and when it materializes. So far, we don't have any reason to to say that the macro demand is impacted or not impacted. So I think that's how I would explain the story.

Karl Ackerman

Thank you.

Operator

Tore Svanberg, Steel.

Tore Svanberg

Yes, thank you. I just had a couple of follow up's and and sorry for staying on the topic of tariffs Kishore, but I understand the order discussion in relation to lead times but have you had conversations with your customers or supply chain members about contingencies? I mean, it sounds like the supply chain views this, tariff methods transitory, but have you started having conversations with them about some contingencies, especially if -- some tariffs are going to be higher in certain regions versus others.

Kishore Seendripu

It's too chaotic for us. We have conversation, but we all agree it's chaotic, right? So it's like a slow moving train the response, right? I don't think you can respond to these unprecedented, changes in, daily sort of changes in the policy, right? So it's very hard to have cod conversations and especially because we don't build systems, we sell chips. Right, it's a very different discussion.

Tore Svanberg

Right, no that fair. As my follow up, the multimedia industrial business continues to be very volatile. I know you pointed out, some, China volatility there, but, sure you just explain, why that business is so volatile quarter to quarter.

Steven Litchfield

Yeah, it's, I mean, it has been volatile. I mean, as the industrial market has been soft, and I think just later on that the China, dynamics that have just made that a lot worse, and I think, just softness in Q1 in general. So yeah, there was a big downturn. I do expect it to improve nicely in in Q2, but it's it's definitely been volatile. You're right, Tore.

Tore Svanberg

Great, just one last one, you guided to, operating cash flow positive for Q2, obviously at the $105 million run rate, just curious, now that you are sort of starting that recovery phase with cash flows, what's your inventory date target? I know it sort of was flattish or maybe came down a little bit this quarter, but, where would it eventually land, sort of in the 120, 130 range or even lower than that.

Steven Litchfield

Yeah, well, I mean, I think we've got another couple of quarters of it coming down, and then, but yet, again, as we said earlier, a little tariffs aside. We would expect it to come down for another couple of quarters and then at some point we're going to have to start to build again as the growth outlook, starts to improve. So down for the next two quarters and then probably kind of stabilize.

Kishore Seendripu

Even with whatever you're seeing, we are building for the new products that we are in the pipe, so. So we are building inventory also for the right product mix, the, so that we're not running short in supply for the new product cycle ramps.

Tore Svanberg

Very good thank you.

Kishore Seendripu

Thank you, Tore.

Operator

Thank you. This will conclude the question and answer session. I'll hand the call back to Kishore, for closing remarks.

Kishore Seendripu

Well, thank you all. We're very excited about, the turning point in our business here to returning to cash flow positive and also, on an earnings, on a non-GAAP earnings basis. So this quarter, we also have a many, any number of financial conferences and virtual events, and we'll be participating in them and we'll post details on these on our investors relations page.
So with that, thank you all for joining us today and we look forward to speaking with you again soon.

Operator

This concludes today's conference. You may disconnect your lines at this time. Enjoy the rest of your day.