Monolithic Power Systems, Inc. 2026 Q3 Earnings Call

Please go ahead. Earlier today, MPS released a written commentary on the results of its operations for the third quarter ended September 30, 2026.

This document can be found on our website. Before we begin, I would like to remind everyone that in the course of today's presentation, we may make forward-looking statements and projections within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risk and uncertainties. The risk, uncertainties, and other factors that could cause actual results to differ from these forward-looking statements are identified in the safe harbor statements contained in the Q3 2026 earnings commentary and in our SEC filings, including our Form 10-K and Forms 10-Q, which can be found on our website. Our statements are made as of today, and we assume no obligation to update this information. Now, I would like to turn the call over to Tony.

Thanks, Arthur. Good afternoon, and for us, good morning from Shanghai, and welcome to our Q3 2026 earnings call. In Q3, MPS achieved another significant milestone, exceeding $1 billion in quarterly revenue for the first time. Q3 revenue of $1.2 billion was 22% higher than the second quarter of 2026 and 63% higher than the third quarter of 2025. During the quarter, our capacity surpassed $6 billion in annual revenue support. We expect to have $8 billion of capacity in place by the second half of 2027 on our way to $10 billion in support of our rapidly expanding business. In our enterprise data end market, we saw strong demand across existing customers, which we expect to continue into 2027.

In addition, using our in-house developed AI design tools, we significantly expanded our customer base in traditional areas, as well as landing new wins in applications such as desktop AI designs. Beyond our strong enterprise data growth in automotive, we received first orders for our 48V power solutions and expect design wins for 48V and zonal architectures to be a driver of growth in 2027. We started ramping robotic solutions with sensor and motor control products across multiple geographies. We continue to increase our SAM with the ramp of our high-speed memory products. We landed our first large data converter design win, which we expect to ramp next year, and we continued to build out our high-voltage portfolio and began sampling GaN-based solutions for use in 800V data center architectures, complementing our existing silicon carbide-based designs. Finally, in Q3, we repurchased over $450 million of our own stock.

Overall, we see accelerated growth. Our diversified growth strategy is paying off. Operator, you may now open the line for questions.

Thank you. Yeah. Thanks, Tory.

As Tony mentioned, there is only a few items, so we see beyond that, and I see this explosive growth period, okay, in the next few years. Even this year, you see the first nine months, okay. We do not see any signs to slow down.

Yeah. The only thing I'd add is I think as we've come into the second half, you started to see growth across multiple of our end markets, including auto, which the ramp started here in Q3, and we've talked about continuing here through the second half. Then as we start to see applications like robotics begin to ramp, we'd expect that then to continue into the future. So I think it's not just the existing businesses, it's adding on the additional growth areas over time, which is really giving us confidence going forward.

Thank you. Yeah. It is based on MPS's own development, which is later than we developed a silicon carbide device.

We start to sampling this type of solutions. We let our customer choose either using GaN, the GaN is a new technology for everyone's market and for everyone adapted in the data centers and the industrial automotive type of applications. Okay. This is the first times. We're always very cautious about the reliability. We want to achieve below 1 PPM failures for these modules. We let our customer choose, okay. GaN or silicon carbide. Silicon carbide is known, okay, we know the data. So that's a very high reliability product. GaNs, we have to ship somewhere sort of 50 million units before we can say there's a good, it's a new one. Okay. But we let our customer choose.