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MaxLinear's 1.6T roadmap threatens Credo's dominant AEC position with a specific share target. MaxLinear targets 20–30% of the 1.6T active electrical cable cycle, where its management estimates Credo has 93–99% share, initially across 1–2 US data centers. MaxLinear also reports 1.6T DSP and TIA design-win commitments, with initial revenue expected in 2027 and a stronger ramp in 2028. That competitive concern is behind Credo's pre-market drop. x.com
Credo's margins have plateaued for good because it is using cash from its high-pricing-power active electrical cable business to enter lower-margin, more contested markets. Optical DSPs, silicon photonics chips and ZeroFlap compete with Marvell, Broadcom, Lumentum, Coherent and Fabrinet. Investors who own Credo for AECs are selling as signs of deceleration appear. x.com
Unlocking Samsung production capacity would give MaxLinear a real edge in the capacity-constrained active electrical cable market. CEO Kishore Seendripu outlined an ambition for 20-30% share of the 1.6 Tbps AEC generation over the next couple of years, initially targeting one or two major US data-center customers and challenging dominant incumbent Credo Technology. x.com
MaxLinear is being repriced as a scale-up play: it is one of only three companies, with Marvell and Broadcom, making DSPs for 1.6T optical interconnects, yet is worth about $2B against their $50B+. Its Keystone DSP ships to multiple hyperscalers at 400G and 800G, and its Annapurna platform adds 1.6T AEC and 3.2T retimers for scale-up. Infrastructure revenue grew 130%, revenue is projected at $630M by 2028 from about $200M, and Applied Optoelectronics' 800G and 1.6T ramp needs DSPs. x.com
MaxLinear's planned 1.6T AEC entry is too distant to justify the scale of Credo's selloff. Credo still has an estimated 90%+ AEC share and relationships with five of six major hyperscalers; MaxLinear expects initial revenue only in 2027 and a more meaningful ramp in 2028. Competition bears watching, but the market looks to be overreacting and Credo is starting to look ridiculously cheap. x.com x.com
Credo is a trade rather than a long-term hold because co-packaged optics is the technology that closes the copper-to-optics gap its retimers and active electrical cables fill. If CPO ramps faster than expected in the 2027 architecture cycle, those products get designed out. That is not a 2026 problem, but it is why a decelerating hyper-growth chipmaker can't keep a 15x sales multiple forever. Customer concentration, which hit the stock before, adds risk, and Credo fits no AI endgame theme. x.com … Show more
MaxLinear's longer-term DSP demand depends on which near-packaged-optics architecture customers adopt. Keysight's Kazuo Yamaguchi explains that retimed NPO retains a DSP and allows independent engine testing, while linear-drive NPO removes it. Linear-drive designs make failures harder to isolate. The DSP risk remains worth considering: architecture choice and whose DSP customers select both affect how much of this opportunity MaxLinear captures. x.com
Credo's leading AEC position and vertical integration keep its optics thesis bullish despite SpaceX moving away from 1.6T AECs. That shift is a genuine risk, but xAI has been in Credo's AEC ecosystem the longest, which could support ZeroFlap optics and its telemetry software. Credo's VCSEL-based ALCs were still ramping toward 2027, giving it another route as customers move to transceivers. x.com x.com x.com
MaxLinear is one of only three makers of DSPs for 1.6T optical interconnects alongside $50B+ giants Marvell and Broadcom, yet is worth only about $8-9B. Per @BryzonX, it alone has secured fab capacity to mass-produce 1.6T from 2H26 through 2H27, and its DSPs have a 30% energy advantage. Marvell trades at roughly 32x sales; the same multiple on MaxLinear's $468M trailing revenue gives about $15 billion, nearly double, and more if revenue inflects hard on 1.6T. x.com x.com x.com
MaxLinear's post-earnings reaction looks like an overreaction to solid growth. Q2 revenue rose 55% to $168.8M, infrastructure grew 145%, and adjusted operating margin expanded to 22.3% from 15.9%. Q3 guidance of $210-220M implies another ~27% sequential jump, 2026 optical data-center revenue guidance was raised again to $190-210M from $150-170M, and 1.6T products are in customer qualification. x.com
Celestica's stronger hyperscaler switch and rack outlook points to more demand for Credo's AECs in the same buildout. Celestica beat its Q3 guide, raised FY26 and expects accelerating 2027 growth; that read-through suggests a strong Credo December print, a second-half FY27 inflection and likely a huge guide. x.com
MaxLinear has strong operating leverage as its 800G optical data center ramp runs far faster than expected. Q3 revenue is guided up about 27% sequentially with flat OpEx, lifting operating margin near 28% on the way to 30%+. Weak cash flow reflects prepaying for 5nm wafers to meet a six-month backlog. FY26 optical guidance rose to $210-230M entirely from 800G, and 1.6T Rushmore, retimers and storage accelerators ramp in 2027-2028 with massive upside. The sell-off looks way overdone. x.com x.com
