MACOM Technology Solutions Holdings, Inc.: MTSI NDR: Doubling Up

Research evidence excerpt

MACOM Technology Solutions Holdings, Inc.: MTSI NDR: Doubling Up

Barclays | MACOM Technology Solutions Holdings, Inc.

• SATCOM content varies across satellite types and customers depending on design choice

(direct-to-cell vs. broadband). Not giving explicit number but can be 5/6 figures. Total SAM in

the hundreds of millions with content drivers chips behind the beam former, transmitters and

receivers for microwave backhaul for up and down links, connectivity chips (similar to DC) for

optical to electrical conversion, among other content. See the number of constellations they

are involved with going from 1 to 3 over the next 6 months.

• CW lasers described as 2027 ramp but already seeing demand signals from two customers

and when in production the company immediately expects to be sold out. This is a matter of

getting etched facet technology to work at 50/75mw. Attempting to improve the reliability for

their ion etch process which makes a vertical line in the wafer to form the front facet. The

current challenge for MTSI is their edge is not perfectly aligned which causes an increased

issue with reliability and they are working on a fix. If they are unable to fix it, they will adjust

to use industry standard practices which could take some time. Longer term could move to

produce 200mw lasers. Share gain opportunities opening up at the low end where there is no

supply from traditional CW markets where DFB lasers are now used.

• Talked more about coherent-lite applications potentially moving into the DC at 400G. The

company has more experience vs. some of the analog peers in analog for coherent

modulation.

• Acquired license from HRL for 40nm GaN-on-SiC and moving into the Lowell fab. Perfect

application for high frequency SATCOM applications and also in Defense.