S&P moves MaxLinear view to negative

S&P said it changed its outlook for MaxLinear Inc. to negative from stable and affirmed its BB- issuer and loan ratings.

“We revised MaxLinear's revenue and earnings expectations significantly down from our previous assumptions for 2024, mainly due to a prolonged inventory digestion cycle. With significantly slower capital spending by telecom operators and the extended period of excess customer and channel inventory built up, we expect total revenue in 2024 to fall to about $465 million, 60% lower than the peak reached in 2022,” S&P said in a press release.

The agency said it now forecasts S&P Global Ratings-adjusted leverage above 3x and minimal free cash flow generation during 2024; however, it projects a rebound in 2025 with S&P Global Ratings-adjusted EBITDA margins potentially returning to the high teens.

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