Historic Bookings and Investments: MACOM Expands Operating Leverage (MTSI Q2 2026 Earnings Call)

By Dr. Graph | Updated on May 26, 2026 | earnings

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MACOM Technology Solutions Holdings, Inc. achieved record performance in the second quarter of fiscal 2026 as robust customer demand across all key end markets fueled the largest quarterly bookings in the company's history. Chief Executive Officer Stephen Daly highlighted that the company's growth strategy centered on high-power, high-frequency, and high-data-rate technologies is successfully positioning the business as a critical strategic partner. Strong execution across manufacturing facilities and optimized capacity planning enabled the business to expand operating leverage and capitalize on the expanding optical communications wave.

Robust Demand Drives Historic Bookings and Record Revenues

During the second quarter of the fiscal year, MACOM Technology Solutions Holdings, Inc. recorded total revenue of $289 million, marking a new record driven by robust end-market demand. This top-line expansion represents a year-over-year revenue increase of 22 percent, illustrating strong commercial momentum across the company's entire portfolio. Consequently, adjusted earnings per diluted share rose to $1.09, reflecting improved operating efficiency and capacity utilization.

Upgraded Operating Model Targets Margin Expansion and Sequential Gains

Jack Kober stated, "We expect our adjusted operating margin to be approximately 30% next quarter, highlighting the leverage in our financial operating model." Additionally, management expects third-quarter revenue to range from $331 million to $339 million as sequential growth continues across all end markets.

Record Segment Contributions Lead Optical Communications Wave

Segment performance was led by the Industrial and Defense business, which generated a record $120.7 million in revenue. The Data Center segment followed closely, contributing $98.2 million in revenue, while the Telecom segment generated $70.1 million. The sequential growth across these areas was led by Data Center optical products, with Telecom also projected to grow in the future.

Strategic Capital Allocations Shore Up Supply Chain Resiliency

During the Q&A session, Stephen Daly discussed shoring up supply chain security by participating in a fundraising transaction with epitaxial services provider IQE through a 45 million British pounds investment. Additionally, Jack Kober highlighted balance sheet optimization, noting that the company retired $161 million of its convertible notes during the quarter. This deleveraging effort combined with strong demand helped the company achieve a historic 1.5-to-1 book-to-bill ratio, securing a record backlog.

Frequently Asked Questions

What is driving the revised full-year revenue growth outlook for the Data Center segment?

The company upgraded its full-year growth outlook for the Data Center segment to over 60 percent. This upward revision is driven by strong product portfolio expansion, specifically high demand for pluggable optical modules and optical cable production volumes using the 800 and 1.6T PAM4 products.

What process technologies is the company introducing to expand its market share in Telecom base stations?

The company developed its next-generation GaN 4 process technology for high-power linear amplifiers and its new IPD processes. These innovations are designed to enable the in-sourcing of components while achieving superior electrical performance in macro base stations.

How does the company's full-year capital expenditure forecast compare to its recent investments?

The company estimates its full-year capital expenditures will range from $55 million to $65 million. This capital is allocated to expanding manufacturing capacity and upgrading production and engineering equipment across its fabrication facilities.