Greetings, welcome to the MaxLinear, Inc. first quarter 2021 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Brian Nugent. Thank you, sir. You may begin.
Thank you, operator. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss MaxLinear's first quarter 2021 financial results. Today's call is being hosted by Dr. Kishore Seendripu, CEO, and Steve Litchfield, Chief Financial Officer and Chief Corporate Strategy Officer. After our prepared comments, we will take questions. Our comments today include forward-looking statements within the meaning of applicable securities laws, including statements relating to our guidance for second quarter 2021 revenue growth expectations in our principal target markets, GAAP and non-GAAP gross margin, GAAP and non-GAAP operating expense, tax expenses and effective tax rate, and interest and other expense.
In addition, we will make forward-looking statements relating to trends, opportunities, and uncertainties in various product and geographic markets, including, without limitation, statements concerning opportunities arising from our acquisitions of Intel's Home Gateway business and of NanoSemi, growth opportunities for our wireless infrastructure and connectivity markets, and opportunities for improved revenues across our target markets. These forward-looking statements involve substantial risks and uncertainties, including integration and employee retention risks related to the acquisitions, as well as risks arising more generally in our business from competition, global trade and export restrictions, potential supply constraints, the impact of the COVID-19 pandemic, our dependence on a limited number of customers, average selling price trends, and risks that our markets and growth opportunities may not develop as we currently expect, and that our assumptions concerning these opportunities may prove incorrect.
More information on these and other risks is outlined in the Risk Factors section of our recent SEC filings, including our Form 10-K for the year ended December 31st, 2020, and our first quarter 2021 Form 10-Q, which was 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 2021 earnings release is available in the investor relations section of our website at maxlinear.com. In addition, we report certain historical financial metrics, including net revenues, gross margins, operating expenses, income or loss from operations, interest and other expense, income taxes, net income or loss, and net income or loss per share on both a GAAP and non-GAAP basis. We encourage investors to review the detailed reconciliation of our GAAP and non-GAAP presentations in 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 charges, including stock-based compensation and its associated tax effects. Non-GAAP financial measures discussed today do not replace the presentation of MaxLinear's GAAP financial results. We are providing this information to enable investors to perform more meaningful comparisons of our operating results in a manner similar to management's analysis of our business. Lastly, this call is also being webcast, and a replay will be available on our website for two weeks. Now let me turn the call over to Kishore Seendripu, CEO of MaxLinear.
Thank you, Brian. Good afternoon, everyone. Our Q1 financial results highlight record quarterly revenue of $209.4 million, up 8% sequentially, cash flow from operations of $40.3 million, and non-GAAP gross margin of 58.6%. Our results and outlook are moderated by the industry-wide semiconductor manufacturing supply chain constraints, even as we are proactively developing strategies to minimize the impact for our customers. In Q1, our broadband access revenue stood at 59%, infrastructure at 14%, industrial and multi-market 14%, and connectivity at 13% of overall revenues. Turning to some of the Q1 business highlights. In broadband access, end market demand remains robust, driven by continued strong MSO deployments, sustaining subscriber broadband consumption demand trends, and our share gains across our target markets. The breadth of our broadband access and Wi-Fi SoC assets continues to expand customer engagement on next-generation broadband access and in-home connectivity architectures.
In our connectivity business, which consists of multi-gigabit Wi-Fi, Ethernet, MoCA, and G.hn technologies, shipments took a temporary pause owing primarily to supply constraints. We expect a strong recovery in Q2 with all four products growing quarter-over-quarter. We are pleased with the strong Wi-Fi design win momentum and product ramp on WAV600, along with the adoption of our WAV600 release to silicon. We see multiple tri-band Wi-Fi platforms ramping in 2022, which utilize the 2.5 GHz, 4 GHz, 5 GHz, and 6 GHz spectrum capabilities of our solutions across North America cable and service providers. Our Wi-Fi business is on track to double in 2021 and has the momentum to potentially double again in 2022.
Additionally, in Q1, our MoCA shipments to our flagship US telco customer and to an additional new Canadian telco customer continued to grow. We also expect our G.hn business to post double-digit growth in 2021. During Q1, we released the industry's first quad-port Ethernet PHY optimized for 2.5 Gb applications, which builds on our earlier success in 1 Gb and 2.5 Gb PHYs and 1 Gb switches. We expect the adoption of 2.5GBASE-T to accelerate over the next several years, driven by new and growing multi-gigabit broadband applications such as 10 Gb PON, DOCSIS 3.1 Modems, and Wi-Fi 6 routers, as well as its mass market adoption in the enterprise industrial laptop markets. We are positioned extremely well at the front end of the 1 Gb to 2.5 Gb Ethernet upgrade cycle.
Moving to wireless infrastructure market, our Q1 revenue rebounded strongly, nearly doubling quarter-over-quarter, owing to a strong recovery in wireless backhaul deployments, combined with the anticipated initial production revenue shipments from our 5G massive MIMO RF transceiver SoCs. Our current wireless infrastructure bookings momentum supports continued growth throughout the year. In 5G access, we also announced our partnership with Facebook on the Evenstar program to develop an integrated O-RAN SoC, which incorporates our state-of-the-art 5G RF transceiver, digital predistortion algorithms, and Open RAN functionality. In optical data center, we are making progress towards mass production ramp of our 400G PAM4 DSP in the second half 2021, along with strong adoption of our 100G PAM4 offering by tier 1 customers. Additionally, we are on track to sample our industry-leading new Keystone family of 5 nm CMOS 800G, 800 gigabit PAM4 SoC products in Q2.
Keystone solidifies our ability to capitalize on the PAM4 optical interconnect market, which will dominate cloud and edge data center deployments over the next several years. Our high-performance analog business posted strong growth in Q1 across both infrastructure and industrial multi-market applications. Despite a challenging supply chain environment in high-performance analog, we believe that our lean channel inventory levels, rapidly growing design win funnel, and exciting new product developments position us very favorably for growth in 2021 and beyond. We have made significant progress in expanding our portfolio in all our end markets and are broadening our penetration and customer traction in new exciting growth markets. We believe this expanded value proposition and our enhanced target addressable market across high-growth broadband connectivity and infrastructure, both together position us well for strong profitable growth in 2021 and beyond.
Now, let me turn the call over to Mr. Steve Litchfield, our Chief Financial Officer and Chief Corporate Strategy Officer.
Thanks, Kishore. I will first review our Q1 2021 results and then further discuss our outlook for Q2 2021. Total revenue for the quarter was $209.4 million, up 8% versus Q4. Infrastructure revenue was increased by 61% compared with Q4, above our expectations and driven by a strong recovery in both our wireless backhaul and high-performance analog end markets, along with growing 5G access market contribution. Our broadband business demonstrated strong growth during the quarter, up 10% sequentially, and slightly better than our expectations, driven by upside in gateway SoC shipments. Solid demand for our broadband products is being driven by a combination of end market strength and company-specific drivers, including silicon content increases and share gains. Our connectivity business was down 20% sequentially as supply constraints in Wi-Fi and Ethernet was only partially offset by growth in G.hn and MoCA.
Lastly, our industrial and multi-market business was down 1% sequentially and in line with expectations as softness in components was largely offset by strength in the HPA demand. GAAP and non-GAAP gross margin for the first quarter was approximately 53.4% and 58.6% of revenue, up 10.7% and 80 basis points over last quarter, respectively. The delta between GAAP and non-GAAP gross margin in the first quarter is primarily driven by $10.7 million of acquisition-related intangible assets amortization, in addition to $0.3 million of stock-based compensation and performance-based equity. First quarter GAAP and operating expenses were at $101.8 million, down sequentially and slightly below the low end of our $103 million-$107 million guidance range.
The GAAP operating expenses included stock-based compensation and stock-based bonus accruals of $19.3 million, combined amortization of purchased intangible assets of $6.1 million, restructuring charges of $2.2 million, and acquisition and integration costs of $1.7 million. Non-GAAP operating expenses were $72.6 million, down $3.2 million versus Q4, and at the low end of our guidance range of $72 million- $76 million. Non-GAAP operating margin for Q1 2021 of 24% was the highest level in the past six quarters. Moving to the balance sheet and cash flow statement. Our cash flow generated from operating activities in the first quarter 2021 was $40.3 million, and we ended the period with $149.2 million in cash equivalents, and restricted cash.
Our loan balance stood at $350 million exiting Q1, as we made principal payments of $20 million during the quarter, and we have subsequently paid down another $15 million. We remain consistent in our intentions around uses of cash, with priorities on debt paydown and strategic acquisitions. We also purchased $2.7 million of stock late in the quarter after the board approved the $100 million buyback program. Our day sales outstanding for the first quarter was approximately 38 days, slightly up from 32 days in the prior quarter due to shipment linearity. Our inventory turns were 4.1 compared to 4.4 in Q4. That leads me to our guidance. We currently expect revenue in the second quarter of 2021 to be approximately $200 million-$210 million, down 2% sequentially at the midpoint of the guidance range.
We expect broadband revenue to be down quarter-over-quarter as semiconductor manufacturing supply chain tightness is expected to constrain shipments below actual end market demand. We expect infrastructure revenue to be up slightly versus Q1 due to modest growth in wireless backhaul and wireless access. We expect our industrial multi-market revenue to be flat to down on a sequential basis. Lastly, we expect our connectivity to grow double digits quarter-over-quarter, with the rebound being driven by a combination of solid demand and supply improvement. While the theme of broader supply constraint continues to be prevalent across the entire industry, we continue to aggressively manage these issues in order to support our customers.
With that said, we have seen limitations dating back to the fourth quarter and believe supply will continue to be an issue through the balance of the calendar year and into the first half of 2022. This uncertainty does impact our visibility with respect to product mix. We expect second quarter GAAP gross profit margin to be approximately 52.5%-54.5%, and non-GAAP gross profit margin to be between 58%-60% of revenue, with the midpoint up from 40 basis points from Q1. As a reminder, our gross profit margin percentage forecast could vary ±2%, depending on the product mix and other factors. We continue to fund strategic development programs targeted at delivering strong top-line growth in 2021 and beyond, with particular focus on infrastructure and connectivity initiatives and our stated goal of increasing the operating leverage in the business.
We expect Q2 2021 GAAP operating expenses to increase approximately $2.7 million quarter-on-quarter to a range of $102.5 million-$106.5 million, primarily driven by increased prototyping expenses and payroll-related expenses. We expect Q2 2021 non-GAAP operating expenses to be up approximately $2.4 million versus Q1, to a range of $73 million-$77 million. We expect GAAP tax expense to be approximately zero and a non-GAAP tax rate of 6%. We expect GAAP interest and other expense to be $3.9 million-$4.1 million and non-GAAP interest and other expense to be $3.8 million-$4 million. In closing, we continue to see sustainable fundamental expansion across all of our addressable markets. This is largely being driven by a combination of company-specific catalysts, including new product introductions, market share gains, and content per platform increases.
We believe our end markets are also demonstrating favorable growth profiles due to the proliferation of global networking, in addition to the recent trend towards the incremental dependency on reliable and robust connectivity. Our infrastructure efforts in PAM-4 and 5G continue to foreshadow meaningful growth coming in 2021 and beyond as production platform ramps commence. We are also pleased with both the near-term customer traction and development milestones in our Wi-Fi business. We remain steadfast in supporting customers through a dynamic market environment, which pairs accelerating demand with tight supply constraints. We remain focused on expanding upon our recent profitability, advancements, and strong cash flow generation while continuing to execute on the integration efforts as well as our organic infrastructure developments. With these profitable growth initiatives, we continue to believe we are uniquely positioned to deliver strong leverage in our business in 2021.
With that, I'd like to open up the call for questions. Operator?
Thank you. We will now be conducting our question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may also press star two if you would like to remove your question from the queue. One moment please while we now poll for questions. Our first question comes from Tore Svanberg with Stifel. Please proceed with your question.
Yes, thank you. Congratulations on the record results. First question is on capacity. Can you just add a little bit of color on what's going on there, what some of the puts and takes are, especially when I think about your connectivity business being hampered a bit this quarter, but relief is coming next quarter, while broadband is the other way around. If you could just add a little bit of color there, that'd be great.
Yeah, Tore. Thanks for joining. Yeah, look, I think supply constraints are definitely across the board in all of our end markets, across all of our products. Some are worse than others. I think as I mentioned before, I think in the MaxLinear case in particular, it's probably a little more back-end constrained than front-end constrained. As far as the mix that we highlighted, yeah, we did see connectivity impacted a little bit more in Q1. No doubt about that, but we're confident that we'll see that pick back up in Q2. I'm not concerned about the mix quarter to quarter between those particular end markets, but we are working very hard to make improvements on the supply chain situations as we've kind of highlighted in the call.
Very good. On your infrastructure business, obviously had a tremendous quarter. I was hoping you could just talk a little bit about the geographical contribution to that growth. Is this kind of the new run rate? It can grow from here on? Obviously it grew significantly better than what you had expected.
You're right. It did grow quite a bit, and we highlighted that we definitely saw backhaul finally recover. HPA did extremely well. We're starting to see really nice contribution from wireless access, which we're excited about and anticipating. Looking forward to see optical really ramp up in the second half of the year as well. I do think this is, I don't know if it's the new normal, but it's definitely a higher level that should sustain. For a while, we had been kind of pushing that infrastructure business, anticipating it getting over $100, and I think you'll see it easily exceed that $100 million level in 2021.
Great. Just one last question. Could you just give us a sense for where you expect the inventory days to be longer term for the new business model now? You're obviously slightly below 100 days right now, but where are you trying to sort of get the inventory day level to?
Yeah. It's a tough question to answer right now, Tore. Especially given the environment that we're in. With the increased business that we have, along with the supply constraints and just kind of uncertainty in the kind of global world right now, we're trying to anticipate that. We want to build up some more inventory, but we're not quite to that stage, so I can't really answer your question quite yet.
Sounds good, congrats again.
Thanks, Tore.
Thank you. Our next question comes from Ananda Baruah with Loop Capital Markets. Please proceed with your question.
Hi, good afternoon, guys. Thanks for taking the question, and congrats on the strong execution. I guess a couple, if I could. Kishore, you mentioned, when you were talking about, and Steve, this is actually you, I think, who gave the broadband guidance, one of the remarks was supply constraints around broadband demand remain stronger than supply. Kishore, just a moment ago, I think you also said that that's generally across the business. Really, can you just clarify, is it across the business that demand is stronger than supply? I guess you said you're supply constrained across the business. Is it also the case that demand is meaningfully stronger than supply across the business? With regards to broadband specifically, is there any sense of how much demand you're not able to meet right now? I have a quick follow-up. Thanks.
Yeah. Let me address that question. In general, at this point, we have a very strong bookings in place, and there are several factors that contribute to it. Obviously, the supply constraints drive the exceptional booking. However, beyond that, we have new product cycles ramping across connectivity and our new product initiatives in infrastructure. We have a little bit more, what I call real demand that is coming about due to the investments we have made in the past, and securing capacity for those is our biggest goal right now. To that extent, we have constraints across the board. Over and above that, on the broadband side, there's very strong demand that seems very self-sustaining or sustaining due to, I think, a secular situation in terms of broadband demand consumption at the subscriber side.
We don't see any letup in the demand for product or the deployments at the end carriers and operators. I would say we're in a great place. Great product cycles that are building up some momentum here. Infrastructure is beginning to show good sort of spontaneity in the growth here. We are really constrained by supply on how much we can ship, and we do not believe our issues are related to overbooking of product from customers. It is real demand that is mostly non-perishable, and we will be able to fulfill as the supply chain eases up a bit, as we bring more capacity online.
That's fantastic context, Kishore. I appreciate it. The quick follow-up to that is, you mentioned in the press release, I just want to ask you, I think this is your comment. "We feel increasingly confident in the company's outlook for the remainder of this year." Would you be able to sort of give us some sense of what that outlook is since you mentioned it in the press release that you feel confident in it? That's it for me. Thanks.
Yeah. Thanks, Ananda. I'm not sure. We only guide one quarter out, so we're not going to give any guidance beyond that. We do see supply constraints continuing, as I mentioned in the prepared remarks, in the second half and into the first half of 2022. I'll reiterate what Kishore said. The demand is extremely strong across all of our end markets. I would say that we've seen a real fundamental shift in the broadband markets in general, right? Connectivity has been a big play because these are new products for us. Their content increases, which is very meaningful. I think you're also seeing the operators, telecom and cable, really starting to invest. I think as we look out over the next three to five years, you're going to see a substantial increase in the markets there and the amount of spend that these guys intend to make.
That's great context, Steve. Thanks, guys.
Great. Thanks.
Thank you.
Thank you. Our next question comes from Quinn Bolton with Needham. Please proceed with your question.
Hi, guys. It's Michelle on for Quinn. Thanks for taking the question and congrats on the solid results. Just two quick ones for me. Can you guys give me an update on the next generation 5G cellular transceiver, the 8x8 massive MIMO cellular transceiver? On the second question, just between the supply constraints and the elevated shipping costs due to COVID and so on, we're just wondering how you guys feel about the target for the 60% gross margins exiting this calendar year. Do you guys still feel comfortable with that? I know you don't guide more than a quarter out, but I believe that was a target you guys had mentioned after closing the Intel acquisition.
Michelle, I'll answer the first part of the question regarding the 5G product. We were the industry leaders in terms of launching our 8x8 RF transceiver, and even in our 4x4 massive MIMO plus generation product, we were the only ones to support 400 MHz of bandwidth throughput that spans all the way to 6 GHz, right? Not just the lower frequency bands. Obviously, we are now production ready, and we got the garnering design wins for the product. Obviously, our competition is mimicking what we're doing. We expect to be gathering some momentum in design wins as we speak. Obviously, the slowdown and what happened in China has been a setback for us. However, we are gaining meaningful design wins at various OEMs.
As we move forward and look in the next 18 months, we'll be tallying up those wins that should convert into shipments on the 8x8 product. Today, the shipments that have begun for our products are primarily in the four by four product, which we were not incumbents. Remember that we were the ones who came from behind to enter this market. We're very pleased that we were the leaders when we launched 8x8 , and our competition is now playing catch up. Obviously, they're strong. They have incumbent positions. However, eventually we will win. That's our conviction. Okay, Steve?
Yeah. Michelle, on your supply constraint question, I think tying back to gross margins. Yeah, I don't think anything's changed as far as our expectation that we hit that 60% point exiting the year. We're seeing price increases in a number of places, right? As many of our peers are seeing across the industry. We're working very hard. Our real priority right now is just to get supply. Demand has been extremely strong, and we're doing our best to get supply as quick as we can.
I want to add that mix will have an important contribution in gross margin, it's going to be a balance between our infrastructure products and non-infrastructure products. We wait to see how that mix plays out. For now, we only are guiding the next quarter out.
Okay. Thanks, guys. Appreciate it.
Thanks, Michelle.
Thank you. Our next question comes from Suji Desilva with Roth Capital. Please proceed with your question.
Hi, Kishore. Hi, Steve. Congratulations on the strong quarter. Perhaps first on the infrastructure optical ramp, I wanted to clarify, you said 400G. You expect the second half of this year, you'll start to see contribution there. I just want to get a real sense of what kind of linearity, initial shipment levels we can expect out of the gate or whether it takes several quarters to ramp up?
This has been such a tough one to answer, Suji. On 400G, we were the first ones to enter the market as well. Personally, I've been surprised how the market sort of plays out in terms of our own customers and to the end data center player. At this point, we feel we're making good progress towards ramp in the second half, but I still do not have a good sense of linearity or otherwise, right? In this world of trying to secure supply for the new product initiatives, how that affects the ordering patterns at the end customer is also not very clear right now. The good news is we are making progress and are feeling increasingly confident of a ramp in the second half. However, I cannot give you more color on the linearity of those shipments.
Yeah. I can also imagine optical being a tricky supply chain as well, so I understand that. Moving over to the broadband business, the Wi-Fi, can you help us understand if the upgrades to Wi-Fi 6/6E tri-band sweeps in MaxLinear where you weren't before? Or is it an upgrade of your prior content? If so, what's the content increase? Give a sense of how those upgrades will help you guys.
It's a mix of both going on. We have products that are shipping, what we call the WAV 500. This is before the 6 GHz band was added to the Wi-Fi product lines, we have WAV600. That's a tri-band solution, but it's called Release 1. There's the Wi-Fi 6E R2 version, which is the increased data throughput, better utilization of air capacity, multi-user MIMO. That's called the Release 2 silicon. All of those are getting designed in or ramping in production, while our BOM quantity is increasing even with the older generation products. The good news is also we're winning market share because we have started our initial foray into the fiber platforms. I hope to share a lot of good news in the near future, because fiber is a huge growth opportunity for us in front of us and at the full platform ownership.
I think here the goal is to get as much supply as possible, so that we can ship as much quantity as possible in the new platforms and expand our market share because we really are in a great place to do that.
Okay. Helpful color, Kishore. Thanks, guys.
Thanks, Suji.
Thank you. Our next question comes from Alessandra Vecchi with William Blair. Please proceed with your question.
Hey, guys. Congrats on the quarter. Just a quick question on the operating expenses. I feel like I ask you guys this every quarter, but you've done such a tremendous job holding those costs down. I think I remember discussion last quarter about some mask costs coming in Q2 or Q3. Is sort of the streamlined OpEx and the Q2 guidance a function of the mask costs hitting in Q3, or is there something else going on there?
Hey, Alex. Good to chat with you today. From an OpEx standpoint, as kind of expected, we did anticipate this going up. There were some payroll increases as well as some mask additions in Q2, so we do see it going up. Not quite as much as I think what we'd originally expected, but some of those costs I suspect will push into the second half of the year. Net-net, I think it's a little bit better than what we went into the year with, but there were some of those costs that'll push out into Q3.
To answer your question, mask costs related to the 5nm product, which we just talked about in the call, the Keystone product, is part of those increased expenses, and some of it may push out into Q3.
Okay. That's helpful.
Alex, just to further clarify, though, the bigger 5nm stuff will hit next year, though.
Yep.
That's not anticipated in the first half of this year.
That helps. Just on the broadband side, heading into the quarter, there's been investor concern that at some point, because of the work from home trends, that the broadband revenue would sort of trend down or moderate in the back half of the year. Obviously, we're seeing a little moderation in Q2 because of the constraints, but I guess where I'm trying to go with that is if the supply is below the demand and you have all these drivers in terms of increased contacts and the operators finally starting to spend a little bit more and open up the purse strings, does that sort of alleviate the original worries in Q1 of maybe a back half tail off or a 2022 tail off?
I think the best way to answer that. First of all, I think really what's happened kind of post-COVID, I think you've seen this acceleration of the cycle that we've been through where operators don't spend, and we were starting to see the beginning of the cycle where they would start to spend. We saw a lot of that increased demand start because of work from home. I think what you've seen more recently and what you've heard from a lot of our peers, our customers, operators, is that you're probably going to see a multi-year cycle. I think going into this, even the acquisition of Intel, we had highlighted numerous times that this broadband business would probably grow in the low single digits.
I think at this point, based on visibility that we have, feedback from operators and customers is that that could be up mid to high single digits going forward, and then hopefully we'll see some additional content increases and share gains on top of that. Yeah, I think the world has changed. I think you've heard a lot of this commentary about the importance that the operators are placing on the home and wanting to really control and derive services and things like that they're going to continue to invest further. I think that's started to really shift in our own business, and so that's really driving that outlook. Yes, we would agree that things have changed a little bit.
Demand has definitely picked up quite a bit, and really on top of that, I think as you look out over multiple years, you're going to see more of that spending going forward.
Perfect. That was incredibly helpful. Thank you.
Sure. Thank you.
Thank you. Our next question comes from Christopher Rolland with Susquehanna. Please proceed with your question.
Hey, guys. Thanks for the question. I want to dig into the supply situation a little bit more here. You mentioned it was more back end. Is this the substrate issue that most people are having, or is this something else like test or packaging? What does a path towards kind of equilibrium look like there? Is there any way that us analysts can get a sense of the size of these constraints or how the various pieces are moving? Are we having revenue push from Q1 to Q2 or Q2 to Q3? How should we be thinking about this? Thanks.
Yeah, Chris, I wish I could tell you. We're working very hard. It's all of the above. Everything, it's substrates, lead frames, wire bonders that you've heard from numerous people. We're seeing a lot of those challenges. We do expect to see them through the rest of this year. Hopefully they ease in each subsequent quarter, but there's no guarantee of that. The lead times have stretched tremendously, especially on the substrate side. Yeah, we've got some challenges that we got to work through. Fortunately, we've got a lot of demand. We've got a creative team, and we've been working closely with our suppliers, and we're also coordinating with our customers as well, trying to do what we can and cooperate with them to maximize this output.
Okay, thanks. Then maybe you just mentioned lead times, so maybe dig in there a little bit more. Maybe talk about where they were even six months or a year ago, where they are now and talk about this and maybe in the context of bookings and backlog here. Have you guys seen considerably more bookings than you're able to bill right now? Is that backlog building right now? Can you give us any sort of visibility into that backlog, what it might look like now and what this means for billings for you guys in future quarters?
Yeah, look, I think us, pretty consistent with what we've seen from others. You're seeing lead times, quoting lead times up to a year in advance. 52 weeks is a long time to get product. We definitely have seen bookings increase quite dramatically. Our backlogs increased. We've heard other peers talk about booking out an entire year. We're definitely seeing that, right? We're very confident. We've got great visibility. It's important that customers are kind of getting in line, and I think they've been reacting to make sure that they're scheduling out their own needs. We do have incredible visibility at this point, and so that really helps from a planning perspective and gives us a lot more confidence as we're forecasting the year, albeit somewhat tough in the short term with some of the tighter supply constraints.
Thank you.
Thank you. Our next question comes from Bill Peterson with JP Morgan. Please proceed with your question.
Hi. Good afternoon, congrats on the results. Trying to ask the sort of supply-demand questions a little bit differently. I know you only guide one quarter at a time, that's fair, I guess, we see here how the impact on broadband is with the sequential decline, even amidst strong demand, while connectivity obviously is up. Is the demand such that, can you drive, I guess, sequential growth into the third and fourth quarter across your businesses? Is the demand supportive of that? Do you expect at this stage that supply could be supportive of growth in the back half across your various segments?
Yeah. Bill, these are all great questions. They're also hard to answer when you don't have that visibility. Look, I don't know, I guess the best thing that I can say is that I think we absolutely continue to see very tight constraints in Q2 and Q3. I think we're optimistic things start to improve in Q4 and into next year, but there's no guarantees on these things. That's my take on the overall supply chain. I guess I'd add, and I don't know if this is part of your question or not, but on the broadband and connectivity side, just to maybe echo what you've heard in our prepared remarks and what Kishore shared already, I do feel confident that you're going to continue to see growth there.
As I look into next year, we're continuing to see really nice growth in that business from a year-over-year perspective. Supply chain constraints are going to push some of that to the back half of the year and into 2022. We're seeing very solid demand in 2022 already.
That's really good color. Maybe more specifically, coming to their infrastructure and in particular access. We're hearing more about O-RAN coming. You kind of mentioned the Facebook opportunity. On one hand, it feels like it's still a few years away, but I guess when do you really expect some of these O-RAN developments to start? How is MaxLinear positioned? You talked about the 8x8 , obviously we've seen some announcements from some of your peers that they're working closely with some of the compute companies or other companies that have already sort of started some initial O-RAN deployments.
Bill, obviously we are working with all of those. If you're on the Facebook Evenstar program, they're all natural allies and partners and co-developers on the full solution. As being selected at the front end transceiver DFE or O-RAN single chip or macro base station applications, we are a big part of that game plan. Regarding things pushing out 2 years on shipment, my gosh, we've been investing for 3 years now in wireless infrastructure, and it seems like this is the nature of the beast. I think that if you are going to be invest infrastructure, and this is true in the optical side as well, is that you are in for the long haul. We are committed. The TAM is wonderful. It's very high-quality product that really very complementary to our great engineering skills.
We are in this for real and for the long term. While we live in this quarterly world of earnings, this thing, my focus is the long term. I think we should feel really, really good because if you combine the analog RF mixed signal capabilities with really high-end, at the tip of the spear, 5nm technology capabilities, I dare say among the players that are present today in this ecosystem, maybe there'll be future ones, you can't pick anybody who can match us right now, right? It's a matter of getting to the customer and getting the sales to ramp, and that's going to take at their pace, and that's okay. I've been patient now for 15 years in my life. I got 15 more to go.
It's good to hear that you're competitive in this space, and we look forward to seeing the progress. Thank you.
Thanks, Bill.
Thank you. Our next question comes from Sam Peterman with Craig-Hallum Capital Group. Please proceed with your question.
Hi, guys. Sam on for Richard here. Thanks for taking my question. I wanted to ask about MIMO. I'm curious what kind of share you guys think you can get with your SoCs for MIMO, particularly the 8x8 that you're coming to market towards the leading edge with. You've named Texas Instruments and ADI as your biggest competitors. Curious how you expect share to shake out, and does Nokia ramping their ReefShark SoC in 2021 affect that at all? Thanks.
You ask a very, very hard question because nobody shipping 8x8 right now, have some design wins been awarded? Yes. You really need to keep in mind that the Chinese OEMs are not part of the configuration right now for the most part, for anybody. They are now reverting to the older platforms in shipments, given the regulatory restrictions, trade restrictions that both Huawei has been put under. Now, the whole dynamic has changed and 8x8 is going to be driven by the Western OEMs and the Japanese and the Korean OEMs, and there we are really very competitive and actively engaged. Among the ones that have been selected, we have won a couple, and so I think ultimately this is going to be a two-player market on the transceiver space, and we hope to be one of the two.
That's what we are focused on closing out on.
Okay, great. That's helpful. Then just a quick follow-up. On broadband, especially in Wi-Fi, you've noted that both content and share have been increasing in recent quarters. I'm curious how you characterize the split between content and share and driving broadband growth this quarter, and if you expect one or the other to be a bigger driver of performance next quarter. I'd be curious too, if that answer would be different absent the supply constraints you've talked about.
I think let's keep supply chain completely out of the discussion here so that it give you a sense of a flavor, right? If you think about, you rewind back the clock about two years ago, if you look at where the Intel connected home business was in terms of the digital side of the SoC and MaxLinear was the front end, those platforms had Wi-Fi from third players. You fast forward to now, together, we have all the Wi-Fi, we have the Ethernet, we have the baseband, we have the front end, and more importantly, the ESP. Wi-Fi from three years ago to now are more than doubled or even closer to tripled this thing. In a way, the Wi-Fi is the single biggest BOM element on the platform now.
It's really an outsized component on the platform, and it'll continue to be even more so as operators are trying to take control of your home and provide services inside the home and connectivity inside the home. I would say that clearly, at least a doubling of the BOM has happened from a TAM perspective from three years ago. Yes, we are benefiting, I think, substantially more on BOM increase as we move forward. At the same time, in a couple of operators, we are gaining more share. If you combine the two, you have a multiplicative effect. As Steve said, we are feeling pretty strong that the operator business is entering a big spending cycle, investment cycle, and we'll be very strong beneficiaries of that over the next few years to come.
Okay, great. Thanks, guys.
Thanks, Sam.
Thank you. Our next question comes from Tim Savageaux with Northland Capital Markets. Please proceed with your question.
Hi, good afternoon, and congrats on the results. Should have hopped in a little earlier because I think you addressed a little bit of this, but maybe we can go into it. That really concerns growth in sort of the broadband connected home area, and you've already said you see the prospects for mid to high single digit growth instead of low single digit growth. I guess I would try and juxtapose that against your biggest competitor having an event recently and talking about double-digit growth potential for that $3 billion piece of their broadband IC business. I think there are areas in which you do and don't overlap, particularly on the broadband infrastructure side, but a lot of overlap in CPE and connectivity. I'd be interested in your thoughts on the potential for a double-digit growth in that group.
Although I know I'm getting ahead of myself because you just raised it from low to high singles, but your comments would be appreciated.
Yeah. Well, I'll jump in first. There's no hedging going on here. We're both equally in this market. Yes, they have some, I think you're aware, they have some infrastructure business that we don't have, but there was no hedging. I think it very well could be double-digit growth. The feedback that we're getting, the market traction that we're getting, insights that we're seeing from our customers, it absolutely can be double-digit growth.
Great. Thanks very much, and congratulations again.
Thank you. There are no further questions at this time. I'd like to turn the call back to management for any closing remarks.
Thank you, operator. We'll be participating at the following upcoming conferences during Q2. We'll be at the Needham Technology & Media Conference on May 18th, at the JP Morgan Global Technology, Media and Communications Conference on May 24th, at the Craig-Hallum Institutional Investor Conference on June 2nd, at the Cowen Annual TMT Conference on June 3rd, and at the Stifel Cross Sector Insight on June 8th to June 10th. We hope to meet many of you there, and we look forward to relating to you further progress on our outlook. Thank you.
Ladies and gentlemen, this concludes today's web conference. You may now disconnect your lines at this time. Thank you for your participation, and have a great day.