Maxlinear, inc. announces fourth quarter 2022 financial results
Carlsbad, calif.--(business wire)--maxlinear, inc. (nasdaq: mxl), a leading provider of rf, analog, digital and mixed-signal integrated circuits, today announced financial results for the fourth quarter and fiscal year ended december 31, 2022. fourth quarter financial highlights gaap basis: net revenue was $290.6 million, up 2% sequentially and up 17% year-over-year. gaap gross margin was 56.2%, compared to 58.6% in the prior quarter, and 57.2% in the year-ago quarter. gaap operating expenses were $122.2 million in the fourth quarter 2022, or 42% of net revenue, compared to $115.5 million in the prior quarter, or 40% of net revenue, and $112.4 million in the year-ago quarter, or 45% of net revenue. gaap income from operations was 14% of revenue, compared to income from operations of 18% in the prior quarter, and income from operations of 12% in the year-ago quarter. net cash flow provided by operating activities was $69.4 million, compared to net cash flow provided by operating activities of $61.8 million in the prior quarter, and net cash flow provided by operating activities of $16.0 million in the year-ago quarter. gaap diluted earnings per share was $0.38, compared to diluted earnings per share of $0.35 in the prior quarter, and diluted earnings per share of $0.35 in the year-ago quarter. non-gaap basis: non-gaap gross margin was 59.6%. this compares to 62.0% in the prior quarter, and 61.7% in the year-ago quarter. non-gaap operating expenses were $78.5 million, or 27% of revenue, compared to $80.4 million or 28% of revenue in the prior quarter, and $75.9 million or 31% of revenue in the year-ago quarter. non-gaap income from operations was 33% of revenue, compared to 34% in the prior quarter, and 31% in the year-ago quarter. non-gaap diluted earnings per share was $1.07, compared to diluted earnings per share of $1.05 in the prior quarter, and diluted earnings per share of $0.86 in the year-ago quarter. fiscal year 2022 financial highlights net revenue was $1.1 billion, up 26% over fiscal 2021. gaap gross margin was 58.0%, up from 55.6% the prior year, and gaap net income was $125.0 million, an increase of 198% from $42.0 million for 2021. non-gaap gross margin was 61.6%, up from 60.5% the prior year, and non-gaap net income was $342.2 million, a 59% increase from $214.6 million for 2021. net cash flow provided by operating activities was $388.7 million in 2022, compared to net cash flow provided by operating activities of $168.2 million in 2021. management commentary “in the fourth quarter, we continued our strong execution with revenue up 2% sequentially and up 17% year-over-year, bringing fiscal 2022 revenues to over $1 billion. in particular, in q4, our wi-fi business delivered substantial sequential and year-over-year growth. our connectivity category almost doubled in q4 year-over-year, driven by our differentiated wi-fi6 feature set. our results included strong cash flows from operations of approximately $69 million in q4 and approximately $389 million for the full year. over the last two years, we have delivered transformative growth and strong financials while balancing disciplined expense management along with investments in technology innovation. now, as we enter 2023, we have conviction in our strong long-term growth prospects, owing to our developing technology leadership, accelerating design-win momentum, and expanding target markets, including wi-fi, fiber access, wireless and optical infrastructure. we are also looking forward to our pending acquisition of silicon motion, and are excited for the future growth opportunities of our comprehensive product portfolio,” commented kishore seendripu, ph.d., chairman and ceo. first quarter 2023 business outlook the company expects revenue in the first quarter 2023 to be approximately $240 million to $260 million. the company also estimates the following: gaap gross margin of approximately 55% to 58%; non-gaap gross margin of approximately 59% to 62%; gaap operating expenses of approximately $113 million to $119 million; non-gaap operating expenses of approximately $80 to $86 million; gaap and non-gaap interest and other expenses of approximately $4 million; and gaap and non-gaap diluted share count of 81 to 83 million. webcast and conference call maxlinear will host its fourth quarter financial results conference call today, february 1, 2023 at 1:30 p.m. pacific time (4:30 p.m. eastern time). to access this call, dial us toll free: 1-877-407-3109 / international: 1-201-493-6798. a live webcast of the conference call will be accessible from the investor relations section of the maxlinear website at https://investors.maxlinear.com, and will be archived and available after the call at https://investors.maxlinear.com until february 15, 2023. a replay of the conference call will also be available until february 15, 2023 by dialing us toll free: 1-877-660-6853 / international: 1-201-612-7415 and conference id#: 13735369. cautionary note concerning forward-looking statements this press release contains forward-looking statements within the meaning of section 27a of the securities act of 1933, as amended, and section 21e of the securities exchange act of 1934, as amended. forward-looking statements include, among others, statements concerning our future financial performance (including specifically our current guidance for first quarter 2023 revenue, and gaap and non-gaap gross margins, operating expenses, interest and other expenses, and diluted share counts; statements concerning the company’s pending merger with silicon motion; and statements regarding potential growth opportunities of our product portfolio and target markets including wi-fi, fiber access, wireless and optical infrastructure. these forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from any future results expressed or implied by the forward-looking statements and our future financial performance and operating results forecasts generally. forward-looking statements are based on management’s current, preliminary expectations and are subject to various risks and uncertainties. in particular, our future operating results are substantially dependent on our assumptions about market trends and conditions. additional risks and uncertainties affecting our business, future operating results and financial condition include, without limitation, risks relating to our proposed merger with silicon motion and the risks related to increased indebtedness; the effect of intense and increasing competition; impacts of a global economic downturn and high inflation; our ability to obtain government authorization to export certain of our products or technology; the political and economic conditions of the countries in which we conduct business and other factors related to our international operations; increased tariffs or imposition of other trade barriers; risks related to international geopolitical conflicts; risks related to the loss of, or a significant reduction in orders from major customers; a decrease in the average selling prices of our products; failure to penetrate new applications and markets; development delays and consolidation trends in our industry; inability to make substantial research and development investments; a significant variance in our operating results or rates of growth; claims of intellectual property infringement; our ability to protect our intellectual property; and a failure to manage our relationships with, or negative impacts from, third parties. in addition to these risks and uncertainties, investors should review the risks and uncertainties contained in our filings with the securities and exchange commission (sec), including our current reports on form 8-k, as well as the information to be set forth under the caption “risk factors” in maxlinear’s annual report on form 10-k for the year ended december 31, 2022. all forward-looking statements are based on the estimates, projections and assumptions of management as of february 1, 2023, and maxlinear is under no obligation (and expressly disclaims any such obligation) to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. use of non-gaap financial measures to supplement our unaudited consolidated financial statements presented on a basis consistent with gaap, we disclose certain non-gaap financial measures, including non-gaap gross margin, operating expenses, operating expenses as a percentage of revenue, income from operations as percentage of revenue, and diluted earnings per share. these supplemental measures exclude the effects of (i) stock-based compensation expense; (ii) accruals related to our performance based bonus plan for 2022, which we currently intend to settle in shares of our common stock; (iii) accruals related to our performance-based bonus plan for 2021, which we settled in shares of common stock in 2022; (iv) amortization of purchased intangible assets; (v) research and development funded by others; (vi) acquisition and integration costs related to our acquisitions; (vii) professional fees and settlement costs related to ip and commercial litigation matters; (viii) impairment of intangible assets; (ix) severance and other restructuring charges; (x) other non-recurring interest and other income (expenses), net attributable to acquisitions and (xi) non-cash income tax benefits and expenses. non-gaap financial measures are not meant to be considered in isolation or as a substitute for the comparable gaap financial measures. non-gaap financial measures are subject to limitations, and should be read only in conjunction with the company’s consolidated financial statements prepared in accordance with gaap. non-gaap financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies. we believe that these non-gaap measures have limitations in that they do not reflect all of the amounts associated with our gaap results of operations. we compensate for the limitations of non-gaap financial measures by relying upon gaap results to gain a complete picture of our performance. we believe that non-gaap financial measures can provide useful information to both management and investors by excluding certain non-cash and other one-time expenses that we believe are not indicative of our core operating results. among other uses, our management uses non-gaap measures to compare our performance relative to forecasts and strategic plans and to benchmark our performance externally against competitors. in addition, management’s incentive compensation will be determined in part using these non-gaap measures because we believe non-gaap measures better reflect our core operating performance. the following are explanations of each type of adjustment that we incorporate into non-gaap financial measures: stock-based compensation expense relates to equity incentive awards granted to our employees, directors, and consultants. our equity incentive plans are important components of our employee incentive compensation arrangements and are reflected as expenses in our gaap results. stock-based compensation expense has been and will continue to be a significant recurring expense for maxlinear. while we include the dilutive impact of equity awards in weighted average shares outstanding, the expense associated with stock-based awards reflects a non-cash charge that we exclude from non-gaap net income. bonuses under our executive and non-executive bonus programs have been excluded from our non-gaap net income for all periods reported. bonus payments for the 2021 performance periods were settled through the issuance of shares of common stock under our equity incentive plans in february 2022. we currently expect that bonus awards under our fiscal 2022 program will be settled in common stock in the first quarter of fiscal 2023. expenses incurred in relation to acquisitions include amortization of purchased intangible assets, acquisition and integration costs primarily consisting of professional and consulting fees, and accretion of discount on contingent consideration or deferred purchase price payments to interest expense. research and development funded by others represents proceeds received under contracts for jointly funded r&d projects to develop technology that may be commercialized into a product in the future. initially such proceeds may not yet be recognized in gaap results if, pursuant to contract terms, the company may be required to repay all or a portion of the funds provided by the other party under certain conditions. management believes it is not probable that it will trigger such conditions. once such conditions have been resolved, the proceeds are recognized in gaap results, and accordingly, reversed from non-gaap results. impairment losses are related to abandonment of acquired or purchased intangible assets. restructuring charges incurred are related to our restructuring plans which eliminate redundancies and primarily include severance and restructuring costs related to impairment of leased right-of-use assets or from exiting certain facilities. expenses incurred in relation to our intellectual property and commercial litigation include professional fees incurred. income tax benefits and expense adjustments are those that do not affect cash income taxes payable. reconciliations of non-gaap measures for the historic periods disclosed in this press release appear below. because of the inherent uncertainty associated with our ability to project future charges, particularly related to stock-based compensation and its related tax effects as well as potential impairments, a quantitative reconciliation is not available without unreasonable efforts and accordingly we have not provided a reconciliation for non-gaap guidance provided for the first quarter 2023. additional information and where to find it this press release makes reference to a proposed merger involving maxlinear and silicon motion. in connection with the proposed transaction, maxlinear has filed with the securities and exchange commission (the “sec”), and the sec has declared effective, a registration statement on form s-4 (file no. 333-265645), that includes a proxy statement of silicon motion and a prospectus of maxlinear. the proxy statement/prospectus and this press release are not offers to sell maxlinear securities, and are not soliciting an offer to buy maxlinear securities in any state where the offer and sale is not permitted. maxlinear and silicon motion urge investors and security holders to read the registration statement on form s-4 and other documents provided to silicon motion security holders filed with the sec carefully and in their entirety because they contain important information about the proposed transaction. investors and security holders are able to obtain the registration statement on form s-4 free of charge at the sec’s website, www.sec.gov. copies of documents filed with the sec by maxlinear (when they become available) may be obtained free of charge on maxlinear’s website at www.maxlinear.com or by contacting maxlinear’s investor relations department at ir@maxlinear.com. copies of documents filed or furnished by silicon motion (when they become available) may be obtained free of charge on silicon motion’s website at https://www.siliconmotion.com or by contacting silicon motion’s investor relations department at ir@siliconmotion.com. about maxlinear, inc. maxlinear, inc. (nasdaq:mxl) is a leading provider of radio frequency (rf), analog, digital and mixed-signal integrated circuits for access and connectivity, wired and wireless infrastructure, and industrial and multi-market applications. maxlinear is headquartered in carlsbad, california. for more information, please visit www.maxlinear.com. mxl is maxlinear’s registered trademark. other trademarks appearing herein are the property of their respective owners. maxlinear, inc. unaudited gaap consolidated statements of income (in thousands, except per share data) three months ended december 31, 2022 september 30, 2022 december 31, 2021 net revenue $ 290,586 $ 285,730 $ 247,889 cost of net revenue 127,246 118,242 106,112 gross profit 163,340 167,488 141,777 operating expenses: research and development 73,724 76,437 73,320 selling, general and administrative 44,472 38,472 39,120 impairment losses 2,811 — — restructuring charges 1,172 631 — total operating expenses 122,179 115,540 112,440 income from operations 41,161 51,948 29,337 interest income 70 62 32 interest expense (2,292 ) (2,711 ) (2,400 ) other income (expense), net 1,774 (4,705 ) 1,510 total other income (expense), net (448 ) (7,354 ) (858 ) income before income taxes 40,713 44,594 28,479 income tax provision 9,633 16,186 303 net income $ 31,080 $ 28,408 $ 28,176 net income per share: basic $ 0.40 $ 0.36 $ 0.37 diluted $ 0.38 $ 0.35 $ 0.35 shares used to compute net income per share: basic 78,649 78,436 76,755 diluted 82,406 80,060 81,567 maxlinear, inc. unaudited gaap consolidated statements of income (in thousands, except per share data) year ended december 31, 2022 december 31, 2021 net revenue $ 1,120,252 $ 892,398 cost of net revenue 470,483 396,566 gross profit 649,769 495,832 operating expenses: research and development 296,442 278,440 selling, general and administrative 168,008 149,943 impairment losses 2,811 — restructuring charges 2,265 2,204 total operating expenses 469,526 430,587 income from operations 180,243 65,245 interest income 245 78 interest expense (9,768 ) (12,996 ) loss on extinguishment of debt — (5,221 ) other income (expense), net 3,478 764 total other income (expense), net (6,045 ) (17,375 ) income before income taxes 174,198 47,870 income tax provision 49,158 5,901 net income $ 125,040 $ 41,969 net income per share: basic $ 1.60 $ 0.55 diluted $ 1.55 $ 0.53 shares used to compute net income per share: basic 78,039 76,037 diluted 80,852 79,679 maxlinear, inc. unaudited gaap consolidated statements of cash flows (in thousands) three months ended december 31, 2022 september 30, 2022 december 31, 2021 operating activities net income $ 31,080 $ 28,408 $ 28,176 adjustments to reconcile net income to net cash provided by operating activities: amortization and depreciation 18,825 18,457 24,353 impairment losses 2,811 — — amortization of debt issuance costs and accretion of discount on debt and leases 513 505 416 stock-based compensation 23,550 20,131 16,415 deferred income taxes 133 15,962 (4,640 ) loss on disposal of property and equipment 3 3 — gain on sale of investments (3,375 ) — — unrealized holding loss on investments 58 5,277 — (gain) loss on foreign currency and other 1,416 (570 ) 250 excess tax benefits on stock based awards (219 ) (273 ) (2,046 ) changes in operating assets and liabilities: accounts receivable 7,101 (41,007 ) (12,265 ) inventory 5,426 (19,539 ) (4,249 ) prepaid expenses and other assets (2,168 ) 2,129 (9,301 ) accounts payable, accrued expenses and other current liabilities (16,574 ) 19,768 (22,283 ) accrued compensation 9,816 10,832 9,746 accrued price protection liability (3,394 ) 6,171 (8,956 ) lease liabilities (2,955 ) (2,974 ) (2,835 ) other long-term liabilities (2,690 ) (1,514 ) 3,252 net cash provided by operating activities 69,357 61,766 16,033 investing activities purchases of property and equipment (16,628 ) (9,119 ) (12,242 ) purchases of intangible assets (744 ) (5,236 ) (965 ) cash used in acquisitions, net of cash acquired — — (5,000 ) purchases of investments — (1,000 ) — net cash used in investing activities (17,372 ) (15,355 ) (18,207 ) financing activities payment of debt issuance cost — — (29 ) repayment of debt (50,000 ) (75,000 ) (20,000 ) net proceeds from issuance of common stock 1,792 81 2,494 minimum tax withholding paid on behalf of employees for restricted stock units (369 ) (380 ) (2,068 ) repurchase of common stock — — (15,403 ) net cash used in financing activities (48,577 ) (75,299 ) (35,006 ) effect of exchange rate changes on cash, cash equivalents and restricted cash 2,456 (1,038 ) (1,636 ) increase (decrease) in cash, cash equivalents and restricted cash 5,864 (29,926 ) (38,816 ) cash, cash equivalents and restricted cash at beginning of period 182,493 212,419 170,554 cash, cash equivalents and restricted cash at end of period $ 188,357 $ 182,493 $ 131,738 maxlinear, inc. unaudited gaap consolidated statements of cash flows (in thousands) year ended december 31, 2022 december 31, 2021 operating activities net income $ 125,040 $ 41,969 adjustments to reconcile net income to cash provided by operating activities: amortization and depreciation 80,731 91,792 impairment losses 2,811 — amortization of debt issuance costs and accretion of discount on debt and leases 1,975 3,000 stock-based compensation 81,704 59,358 deferred income taxes 23,454 (3,235 ) loss on disposal of property and equipment 170 533 gain on sale of investments (3,375 ) — unrealized holding loss on investments 1,476 — impairment of leasehold improvements — 226 impairment of leased right-of-use assets 462 429 loss on extinguishment of debt — 5,221 (gain) loss on foreign currency (1,829 ) 634 excess tax benefits on stock-based awards (9,921 ) (7,415 ) changes in operating assets and liabilities: accounts receivable (50,875 ) (51,690 ) inventory (28,841 ) (33,689 ) prepaid expenses and other assets 1,789 24,186 leased right-of-use assets — 72 accounts payable, accrued expenses and other current liabilities 65,815 12,771 accrued compensation 42,003 33,595 accrued price protection liability 73,574 (7,320 ) lease liabilities (11,440 ) (9,905 ) other long-term liabilities (5,997 ) 7,701 net cash provided by operating activities 388,726 168,233 investing activities purchases of property and equipment (41,253 ) (39,176 ) purchases of intangible assets (11,184 ) (7,581 ) cash used in acquisitions, net of cash acquired — (40,000 ) proceeds loaned under notes receivable (10,000 ) — purchases of investments (29,325 ) (5,000 ) net cash used in investing activities (91,762 ) (91,757 ) financing activities proceeds from the issuance of debt — 350,000 payment of debt issuance cost — (4,173 ) repayment of debt (185,000 ) (409,813 ) net proceeds from issuance of common stock 5,006 8,780 minimum tax withholding paid on behalf of employees for restricted stock units (28,896 ) (13,149 ) repurchase of common stock (31,511 ) (23,548 ) net cash used in financing activities (240,401 ) (91,903 ) effect of exchange rate changes on cash, cash equivalents and restricted cash 56 (2,869 ) increase (decrease) in cash, cash equivalents and restricted cash 56,619 (18,296 ) cash, cash equivalents and restricted cash at beginning of period 131,738 150,034 cash, cash equivalents and restricted cash at end of period $ 188,357 $ 131,738 maxlinear, inc. unaudited gaap condensed consolidated balance sheets (in thousands) december 31, 2022 september 30, 2022 december 31, 2021 assets current assets: cash and cash equivalents $ 187,353 $ 181,496 $ 130,572 short-term restricted cash 982 971 105 short-term investments 18,529 18,587 — accounts receivable, net 170,971 178,072 119,724 inventory 160,544 165,970 131,703 prepaid expenses and other current assets 24,745 17,879 22,000 total current assets 563,124 562,975 404,104 long-term restricted cash 22 26 1,061 property and equipment, net 79,018 67,081 60,924 leased right-of-use assets 28,515 30,041 27,269 intangible assets, net 109,316 122,142 152,540 goodwill 306,739 306,739 306,668 deferred tax assets 66,491 65,767 89,168 other long-term assets 26,800 27,927 8,650 total assets $ 1,180,025 $ 1,182,698 $ 1,050,384 liabilities and stockholders’ equity current liabilities $ 341,086 $ 351,318 $ 207,395 long-term lease liabilities 23,353 25,040 24,640 long-term debt 121,757 171,607 306,153 other long-term liabilities 17,444 18,852 22,998 stockholders’ equity 676,385 615,881 489,198 total liabilities and stockholders’ equity $ 1,180,025 $ 1,182,698 $ 1,050,384 maxlinear, inc. unaudited reconciliation of non-gaap adjustments (in thousands, except per share data) three months ended december 31, 2022 september 30, 2022 december 31, 2021 gaap gross profit $ 163,340 $ 167,488 $ 141,777 stock-based compensation 222 188 152 performance based equity 175 136 137 amortization of purchased intangible assets 9,325 9,332 10,759 non-gaap gross profit 173,062 177,144 152,825 gaap r&d expenses 73,724 76,437 73,320 stock-based compensation (10,341 ) (10,635 ) (8,243 ) performance based equity (8,205 ) (7,690 ) (8,224 ) research and development funded by others (2,000 ) (1,000 ) (2,000 ) acquisition and integration costs — — (25 ) non-gaap r&d expenses 53,178 57,112 54,828 gaap sg&a expenses 44,472 38,472 39,120 stock-based compensation (12,988 ) (9,308 ) (8,020 ) performance based equity (3,791 ) (3,043 ) (3,934 ) amortization of purchased intangible assets (1,312 ) (1,541 ) (5,928 ) acquisition and integration costs (1,069 ) (1,278 ) (192 ) non-gaap sg&a expenses 25,312 23,302 21,046 gaap impairment losses 2,811 — — impairment losses (2,811 ) — — non-gaap impairment losses — — — gaap restructuring expenses 1,172 631 — restructuring charges (1,172 ) (631 ) — non-gaap restructuring expenses — — — gaap income from operations 41,161 51,948 29,337 total non-gaap adjustments 53,411 44,782 47,614 non-gaap income from operations 94,572 96,730 76,951 gaap interest and other income (expense), net (448 ) (7,354 ) (858 ) non-recurring interest and other income (expense), net 59 58 (1,893 ) non-gaap interest and other income (expense), net (389 ) (7,296 ) (2,751 ) gaap income before income taxes 40,713 44,594 28,479 total non-gaap adjustments 53,470 44,840 45,721 non-gaap income before income taxes 94,183 89,434 74,200 gaap income tax provision 9,633 16,186 303 adjustment for non-cash tax benefits/expenses (3,982 ) (10,820 ) 4,149 non-gaap income tax provision 5,651 5,366 4,452 gaap net income 31,080 28,408 28,176 total non-gaap adjustments before income taxes 53,470 44,840 45,721 less: total tax adjustments (3,982 ) (10,820 ) 4,149 non-gaap net income $ 88,532 $ 84,068 $ 69,748 shares used in computing non-gaap basic net income per share 78,649 78,436 76,755 shares used in computing non-gaap diluted net income per share 82,406 80,060 81,567 non-gaap basic net income per share $ 1.13 $ 1.07 $ 0.91 non-gaap diluted net income per share $ 1.07 $ 1.05 $ 0.86 maxlinear, inc. unaudited reconciliation of non-gaap adjustments (in thousands, except per share data) year ended december 31, 2022 december 31, 2021 gaap gross profit $ 649,769 $ 495,832 stock-based compensation 735 620 performance based equity 569 469 amortization of purchased intangible assets 39,288 42,992 non-gaap gross profit 690,361 539,913 gaap r&d expenses 296,442 278,440 stock-based compensation (40,635 ) (30,364 ) performance based equity (28,463 ) (27,713 ) research and development funded by others (2,200 ) (5,800 ) acquisition and integration costs — (155 ) non-gaap r&d expenses 225,144 214,408 gaap sg&a expenses 168,008 149,943 stock-based compensation (40,335 ) (28,374 ) performance based equity (11,610 ) (12,301 ) amortization of purchased intangible assets (11,955 ) (23,625 ) acquisition and integration costs (8,711 ) (1,913 ) ip litigation costs, net — (11 ) non-gaap sg&a expenses 95,397 83,719 gaap impairment losses 2,811 — impairment losses (2,811 ) — non-gaap impairment losses — — gaap restructuring expenses 2,265 2,204 restructuring charges (2,265 ) (2,204 ) non-gaap restructuring expenses — — gaap income from operations 180,243 65,245 total non-gaap adjustments 189,577 176,541 non-gaap income from operations 369,820 241,786 gaap income (loss) on extinguishment of debt — (5,221 ) loss on extinguishment of debt — 5,221 non-gaap loss on extinguishment of debt — — gaap interest and other income (expense), net (6,045 ) (12,154 ) non-recurring interest and other income (expense), net 241 (1,377 ) non-gaap interest and other income (expense), net (5,804 ) (13,531 ) gaap income before income taxes 174,198 47,870 total non-gaap adjustments 189,818 180,385 non-gaap income before income taxes 364,016 228,255 gaap income tax provision 49,158 5,901 adjustment for non-cash tax benefits/expenses (27,317 ) 7,794 non-gaap income tax provision 21,841 13,695 gaap net income 125,040 41,969 total non-gaap adjustments before income taxes 189,818 180,385 less: total tax adjustments (27,317 ) 7,794 non-gaap net income $ 342,175 $ 214,560 shares used in computing non-gaap basic net income per share 78,039 76,037 shares used in computing non-gaap diluted net income per share 80,852 79,679 non-gaap basic net income per share $ 4.38 $ 2.82 non-gaap diluted net income per share $ 4.23 $ 2.69 maxlinear, inc. unaudited reconciliation of gaap to non-gaap financial measures three months ended december 31, 2022 september 30, 2022 december 31, 2021 gaap gross profit 56.2 % 58.6 % 57.2 % stock-based compensation 0.1 % 0.1 % 0.1 % performance based equity 0.1 % 0.1 % 0.1 % amortization of purchased intangible assets 3.2 % 3.3 % 4.3 % non-gaap gross profit 59.6 % 62.0 % 61.7 % gaap r&d expenses 25.4 % 26.8 % 29.6 % stock-based compensation (3.6 )% (3.7 )% (3.3 )% performance based equity (2.8 )% (2.7 )% (3.3 )% research and development funded by others (0.7 )% (0.4 )% (0.8 )% non-gaap r&d expenses 18.3 % 20.0 % 22.1 % gaap sg&a expenses 15.3 % 13.5 % 15.8 % stock-based compensation (4.5 )% (3.3 )% (3.2 )% performance based equity (1.3 )% (1.1 )% (1.6 )% amortization of purchased intangible assets (0.5 )% (0.5 )% (2.4 )% acquisition and integration costs (0.4 )% (0.5 )% (0.1 )% non-gaap sg&a expenses 8.7 % 8.2 % 8.5 % gaap impairment losses 1.0 % — % — % impairment losses (1.0 )% — % — % non-gaap impairment losses — % — % — % gaap restructuring expenses 0.4 % 0.2 % — % restructuring charges (0.4 )% (0.2 )% — % non-gaap restructuring expenses — % — % — % gaap income from operations 14.2 % 18.2 % 11.8 % total non-gaap adjustments 18.4 % 15.7 % 19.2 % non-gaap income from operations 32.5 % 33.9 % 31.0 % gaap interest and other income (expense), net (0.2 )% (2.6 )% (0.4 )% non-recurring interest and other income (expense), net — % — % (0.8 )% non-gaap interest and other income (expense), net (0.1 )% (2.6 )% (1.1 )% gaap income before income taxes 14.0 % 15.6 % 11.5 % total non-gaap adjustments before income taxes 18.4 % 15.7 % 18.4 % non-gaap income before income taxes 32.4 % 31.3 % 29.9 % gaap income tax provision 3.3 % 5.7 % 0.1 % adjustment for non-cash tax benefits/expenses (1.4 )% (3.8 )% 1.7 % non-gaap income tax provision 1.9 % 1.9 % 1.8 % gaap net income 10.7 % 9.9 % 11.4 % total non-gaap adjustments before income taxes 18.4 % 15.7 % 18.4 % less: total tax adjustments (1.4 )% (3.8 )% 1.7 % non-gaap net income 30.5 % 29.4 % 28.1 % maxlinear, inc. unaudited reconciliation of gaap to non-gaap financial measures year ended december 31, 2022 december 31, 2021 gaap gross profit 58.0 % 55.6 % stock-based compensation 0.1 % 0.1 % performance based equity 0.1 % 0.1 % amortization of purchased intangible assets 3.5 % 4.8 % non-gaap gross profit 61.6 % 60.5 % gaap r&d expenses 26.5 % 31.2 % stock-based compensation (3.6 )% (3.4 )% performance based equity (2.5 )% (3.1 )% research and development funded by others (0.2 )% (0.7 )% acquisition and integration costs — % — % non-gaap r&d expenses 20.1 % 24.0 % gaap sg&a expenses 15.0 % 16.8 % stock-based compensation (3.6 )% (3.2 )% performance based equity (1.0 )% (1.4 )% amortization of purchased intangible assets (1.1 )% (2.7 )% acquisition and integration costs (0.8 )% (0.2 )% non-gaap sg&a expenses 8.5 % 9.4 % gaap impairment losses 0.3 % — % impairment losses (0.3 )% — % non-gaap impairment losses — % — % gaap restructuring expenses 0.2 % 0.3 % restructuring charges (0.2 )% (0.3 )% non-gaap restructuring expenses (0.2 )% — % gaap income from operations 16.1 % 7.3 % total non-gaap adjustments 16.9 % 19.8 % non-gaap income from operations 33.0 % 27.1 % gaap income (loss) on extinguishment of debt — % (0.6 )% loss on extinguishment of debt — % 0.6 % non-gaap loss on extinguishment of debt — % — % gaap interest and other income (expense), net (0.5 )% (1.4 )% non-recurring interest and other income (expense), net — % (0.2 )% non-gaap interest and other income (expense), net (0.5 )% (1.5 )% gaap income before income taxes 15.6 % 5.4 % total non-gaap adjustments 16.9 % 20.2 % non-gaap income before income taxes 32.5 % 25.6 % gaap income tax provision 4.4 % 0.7 % adjustment for non-cash tax benefits/expenses (2.4 )% 0.9 % non-gaap income tax provision 2.0 % 1.5 % gaap net income 11.2 % 4.7 % total non-gaap adjustments before income taxes 16.9 % 20.2 % less: total tax adjustments (2.4 )% 0.9 % non-gaap net income 30.5 % 24.0 %
