Monolithic Power Systems beats estimates on AI demand

Investing.com -- Monolithic Power Systems Inc (NASDAQ: MPWR) reported third quarter results that exceeded analyst expectations, with adjusted earnings per share of $8.19 beating the consensus estimate of $7.71 by $0.48. Revenue reached $1.20 billion, surpassing the $1.15 billion analyst estimate and marking a 63.1% increase from the third quarter of 2025.

The company's fourth quarter revenue guidance of $1.315 billion to $1.385 billion also topped expectations, with the midpoint of $1.35 billion well above the analyst consensus of $1.22 billion. The strong performance was driven by robust demand in the Enterprise Data segment, which grew 164.6% YoY to $506.7 million, representing 42.1% of total revenue. The quarter marked the first time the company surpassed $1 billion in quarterly revenue.

Shares rose 2.1% in after-hours trading Thursday.

"Overall, we see accelerated growth. Our diversified growth strategy is paying off," said Michael Hsing, CEO and founder of MPS.

The Communications segment also showed significant strength, climbing 134.7% YoY to $187.4 million, driven by higher sales of power solutions for optical modules and switches. Automotive revenue increased 19.2% YoY to $180.7 million, with the company receiving first orders for its 48V power solutions.

Adjusted gross margin for the quarter was 55.7%, up 0.1 percentage points from the second quarter. Adjusted operating income reached $464.5 million, compared to $367.7 million in the prior quarter.

The company announced leadership changes, appointing Tony Balow as Chief Financial Officer and Robert Dean as Chief Accounting Officer, effective immediately. Balow previously served as Vice President of Finance, while Dean had been serving as Interim CFO.

MPS generated operating cash flow of $289.9 million in the quarter and repurchased $453.4 million of its stock. The company's board authorized an additional $500 million for stock repurchases, bringing total current authorization to $1 billion.

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