Maxim Integrated Products, Inc. (NASDAQ:MXIM) stock lost over 3.8% on April 27th, 2018 pre market session (as of 7:51 PM GMT-4; Source: Google finance) on margins pressure. Maxim’s gross margin, excluding special items, was 67.2%, which slightly fell against the earlier quarter on the back of the transition to sell in accounting in Q2. The third quarter gross margin is over 200 basis points higher than the same quarter last year, boosted by solid operational execution. Special items in Q3 gross margin included intangible asset amortization from the acquisition.
The firm delivered a decent performance boosted by their power management products in Consumer, Automotive and Industrial segment. The group sees Automotive, Industrial and Data Center to drive their performance going forward.
Battery management systems, or BMS, is performing well especially in China. They introduced a high current version of their BMS product designed for electric buses during the quarter. This product has already earned a major new design win in China while the Automotive design wins continue to grow in the double-digits. Power, battery management, and serial link products, drove the performance.
Automotive segment rose in the double digits during the March quarter and the group expects a solid sequential growth even in the June quarter, boosted by power management products for infotainment, ongoing momentum in their battery management system business and ADAS products. In the June quarter, they see high-teens year-over-year growth in Automotive. Core segment drove Industrial business boosted by factory automation products, content growth in medical. For the June quarter, the group forecasts Industrial segment to enhance sequentially and rise in the mid-teens against pcp. This performance is boosted by factory automation products coupled with rising reach small and medium business customers with distribution partners.
The group added their customer engagements in factory automation across customers in Europe, the Americas, Japan and China. In 2018, they expect the industry’s install base of IO-Link communication to reach 10 million units globally, doubling against last year’s install base.
They also launched a new line of 3×3 millimeter highly efficient power management modules in the March quarter which integrate the inductor and DC-to-DC converter. In medical, the group is witnessing a double-digit year-over-year growth from a small revenue base in authentication products.