Monolithic Power Systems, Inc.

Monolithic Power Systems reported record Q2 revenue of $981 million, up 22% from Q1 2026 and 48% from Q2 2025. The transcript did not state EPS or gross margin figures, though management said gross margin guidance was expanded slightly and that it is at the low end of where they want to be. For Q3, management said gross margin guidance was raised slightly and they feel comfortable with that level; they also reiterated that spending leverage is helping operating margin. On the business outlook, enterprise data was raised from 85% to 130% for the year, automotive is still expected to be in the mid-teens year over year, and management said consumer and notebook storage/compute remain cautious areas.

Tony Balow emphasized that the quarter reflected innovation, diversified end-market strength, and the company’s transition from a chip company to a full solution provider. He highlighted expansion beyond $6 billion of capacity goals, initial DDR5 orders, sampling of 800-volt data-center products, and growing automotive socket wins. His tone was upbeat but measured, repeatedly stressing long-term execution, diversification, and continued investment for future revenue growth.

The CFO commentary focused on strong order flow, modest gross margin expansion, and operating leverage. Robert Dean said strong Q2 orders allowed the company to incrementally expand gross margin guidance again, while Tony Balow noted higher revenue is creating leverage in operating margin. Management also said pricing was not the driver of growth, though they have raised prices selectively when input costs rise, expedited requests occur, or non-China supply chains are requested. On capital allocation, management announced an additional $500 million share repurchase authorization, lifting total authorization to $1 billion.

Analysts pressed on whether communications growth was coming mainly from optical modules or also from switches, DPUs, and SmartNIC-related sockets; management said both optical module solutions and switch-related power solutions are contributing. Questions also focused on whether data-center demand reflected inventory building, and management said channel inventory remains very low and visibility is supported by strong ordering patterns, with enterprise data growth expectations raised sharply. Analysts asked about DDR5, 800-volt solutions, share opportunities in optical transceivers, and capacity geography; management said the DDR5 opportunity is still early, the 800-volt solution uses MPS silicon carbide, share opportunities remain in comms, and the capacity build is being kept balanced across geographies and increasingly includes backend/module complexity.