Oct 22, 2026 earnings call — AI data center optical infrastructure ramp
Raised 26 optical data server revenue outlook to $250 million to $270 million.
Revenue $0.2B (est $0.2B) · EPS $0.62 (est $0.56) · Next-quarter revenue outlook $0.2B–$0.3B
Key quotes
"Infrastructure as a category grew 210% year on year and which is now larger than the rest of our revenue categories combined."
"We currently expect revenue in the fourth quarter of 26 to be between $240 million and $260 million"
"This included a substantial prepayment for wafers supporting rising demand for our data center products for which we have committed order backlog throughout 2027."
Analyst Q&A 9
Optical DSP outlook and customer mix
Q (Tore Svanberg · Stifel): He asked if the CALMiD26 DSP run rate implies about $400 million-plus in 2027 and how the mix will split between 800-gig and 1.6T. He also asked how diversified the optical DSP customer base is by module maker and geography.
A: Management declined to give specific out-year revenue guidance but said optical DSP shows very strong growth and market-share gains. They expect momentum in 2027 and that Rushmore (1.6T) will start picking up revenue in 2027; the business is broad across major module makers and the US is an increasingly strong driver.
"We will-- we expect in the near to. near-term, Rushmore to start picking up revenue in 2027." — Kishore Seendripu (CEO)
Hyperscalers and pluggable optics roles
Q (Ananda Baruah · Loop): He asked how much of near-term 800-gig revenue is coming from US hyperscalers and how the move to 1.6T will play out timing-wise. He also asked how SerDes will participate in NPO versus CPO pluggables.
A: Management said they do not break out revenue by customer but described the ramp: 1.6T initial revenue starts in early 2027 with a stronger second-half ramp, and US data centers will lead earlier than China. For pluggables, they expect coexistence of multiple approaches and see NPO/LRO as significant options alongside PAM4 SerDes.
"The US data centers will start becoming very important in a-- both on a static snapshot basis and also from a trajectory basis." — Kishore Seendripu (CEO)
Bookings, lead times, and gross margin
Q (Stonex Financial): He asked about visibility into bookings and lead times for 2027, and then asked management to bridge next gross margin expectations (mix, pricing, manufacturing costs, product transitions).
A: They said they have strong booking visibility into 2027 and into 2028, with customers placing orders well beyond lead times to secure supply. Lead times for optical are about 26 to 28 weeks, and gross margin has improved from 58% to 60% this quarter with guidance at 60.5%; margins should trend up as mix shifts to more infrastructure products.
"You know, lead times for optical products are, you know, 26, 28 weeks." — Steven G. Litchfield (CFO)
Supply constraints and ordering behavior
Q (Christopher Rolland · Susquehanna): He asked whether longer lead times are causing customers to order ahead or over-order, and asked which parts (DSP, lasers, etc.) are the main constraints. He also asked about DSP relevance in CPO/NPO.
A: Management said they do not see double ordering; supply chains remain disciplined and customers order what they need. They said optical supply is easing but DSP supply is constrained by foundries, and they view NPO as a larger long-term opportunity than CPO while keeping a full product portfolio including TIAs and drivers.
"We are really constrained by foundries on the DSP supply." — Kishore Seendripu (CEO)
800G vs 1.6T growth timing
Q (Karl Ackerman · BNP Paribas): They asked how to think about relative growth between 800-gig and 1.6T over the next years and whether 400-gig should continue to grow through calendar 2017.
A: They said optical growth this year was almost all 800 in the first half. 1.6T production starts in 2027 and will see much larger growth in 2028; by 2028 the mix may be substantially 1.6T while 800 could trail or continue to sustain into 2029.
"1.6T starts in 2027, but it will have a much bigger growth year in 2028" — Steven G. Litchfield (CFO)
Prepayments/wafers and DSP market share
Q (Quinn Bolton · Needham and Company): He asked if the increase in prepaid assets (~$50 million) reflects wafer prepayments that support the 2027 backlog, and whether more prepayments are needed in Q4. He also asked whether current DSP share (5%–7%) is near the high end by end of 2026.
A: They said prepayments are mostly for wafers but include other items and they expect prepaids to continue rising as revenue projections rise; they increased the revolver to capture capacity. On share, management said it is hard to estimate, but backward-looking they are above the prior 5%–7% number and they expect share could be in the teens in 2 years while continuing to gain share.
"It should be in the teens for sure." — Kishore Seendripu (CEO)
Outgrowing market and long-term share
Q (Timothy Savageaux · Northland): He asked if it is reasonable to use a high-growth baseline (similar to Marvell's AI interconnect CAGR) and whether management expects to outgrow the market and reach double-digit share quickly.
A: Management said they are confident they will outgrow the market. They would not comment on another company's numbers, but said the opportunity is large and growing and that getting into the teens of share over the next couple years is achievable.
"No, Timothy. I feel very confident we are outgrowing the market, which I think supportive of what you are asking." — Steven G. Litchfield (CFO)
Broadband seasonal outlook
Q (Joseph Quatrochi · Wells Fargo): He asked about the seasonal weakness in broadband in 4Q26 and how to think about broadband into 1H27 and 2H27 and the timing of recovery.
A: They said they see seasonality in Q4 but feel good about 2027. Management expects growth in 2027 driven by telco spending and market share gains on the PON side.
"Yeah. I mean, we actually feel pretty good." — Steven G. Litchfield (CFO)
Timing and whether DSP plus TIA included
Q (Tore Svanberg · Stifel): He asked what changed so revenue could appear in the first half next year and whether that revenue includes DSP and TIA or only DSP.
A: Management said an initial design win will start shipping in the first half; quantities are not yet clear but the win is meaningful and sets up a bigger second half. They confirmed the design wins include commitments for both DSP and TIA and said integrating TIA with DSP gives performance and BOM benefits.
"we also have a commitment both for DSP and TIA in these design wins" — Kishore Seendripu (CEO)