Repeat pull from proven relationships plus room left

MaxLinear, Inc. (MXL) — this company's answers

The model's full reasoning — Q2 2017 call → NOWe need to determine if management describes existing customers/accounts that are currently taking more from the company, and that these relationships are lightly penetrated. Look for evidence of expansion within existing relationships, not just new wins. Also, management must convey substantial room remains. From transcript: Kishore mentions "commenced production shipments of our technology 28-nanometer CMOS Microwave backhaul RF transceiver solution" - that's new product, but to existing customers? He says "resulting in significantly expand engineering engagements with several Tier 1 customers" - that's expansion of engagements, but is it revenue? Also "commenced volume production shipments of our 20 twenty gigabit per second millimeter Wave backhaul modem solutions to a Tier 1 Chinese OEM" - that's a new product to an existing customer? Possibly. But the question asks: does management describe that counterparties the company has ALREADY SERVED AND PROVEN ITSELF WITH are CURRENTLY, ON THEIR OWN INITIATIVE, TAKING OR COMMITTING TO MEANINGFULLY MORE from the company than they previously did? And that these relationships remain LIGHTLY PENETRATED? Look for specific statements about existing customers expanding. For example, in cable data: "we anticipate double-digit year-on-year growth in our cable data business. During the second quarter, we witnessed the initial volume production ramp of DOCSIS 3.1 platforms for a major US cable operator." That's a ramp of a new product to an existing operator? Possibly. But is that "on their own initiative"? It's a product ramp. Also "we commenced shipments of our 3 gigabit MOCA 2.5 solution parallel with the continual ramp of 1 gigabit MOCA 2.1 shipment to a Tier 1 US telco operator." That's existing operator taking more. But the key is: does management convey that these relationships are lightly penetrated? For example, in satellite, they talk about digital channel stacking, but that's a product line. For MOCA, they say "we have greatly expanded our wireline connectivity presence" - but is that existing customers? They mention "garnering interest - increased interest from the traditional coaxial cable satellite and cable operators" - that's interest, not necessarily current expansion. Look for explicit statements about room to grow within existing accounts.

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