Monolithic Power Authorizes $500 Million in Share Buybacks After Record Results
Key Facts
Monolithic Power Systems’ board authorized an additional $500 million for share buybacks in October 2026, raising the existing authorization to $1 billion after buybacks carried out in the third quarter, according to a company filing published on Nasdaq. The decision came after the company posted record quarterly revenue of $1,202 million, topping the $1 billion mark in a single quarter for the first time. Revenue rose 22.6% from the second quarter and 63.1% year over year. The company said it repurchased $453.4 million of shares in the third quarter, compared with $4.0 million in the second quarter. The new authorization keeps that amount available for the company to repurchase shares, while the scale of completed transactions shows a sharp increase in spending on the program during the quarter.
Enterprise Data led growth, with revenue of $506.7 million in the third quarter, up 33.2% from the previous quarter and 164.6% from the same period last year. The segment accounted for 42.1% of the company’s total revenue, compared with 38.8% in the comparable period shown in the results table. The company attributed the quarterly increase to higher sales of power-management solutions used in AI and server applications. It said demand from existing customers is strong and that it expects it to continue through 2027. That puts the company’s largest segment at the forefront of the expansion that accompanied the first quarterly revenue figure above $1 billion.
Growth extended to the communications segment, which generated revenue of $187.4 million, up 134.7% year over year. The company said segment revenue rose 42.5% from the second quarter, driven mainly by higher sales of power solutions for optical modules and switches. On profitability, gross margin under generally accepted accounting principles was 55.4%, up 0.2 percentage points from the previous quarter. Operating income under the same standard rose to $357.7 million, from $303.9 million in the second quarter. Net income was $271.1 million, or $5.51 per diluted share, while adjusted net income was $402.7 million and adjusted diluted earnings per share were $8.19.
Operating activities generated cash flow of $289.9 million in the third quarter, compared with $227.9 million in the second quarter. Meanwhile, cash and cash equivalents and short-term investments fell to $1,091.2 million at quarter-end, from $1,413.8 million at the end of the previous quarter. The decline coincided with $453.4 million in share buybacks during the quarter, according to company data, though the filing did not link the change in the cash balance to that factor alone. The company said its production capacity currently supports annual revenue exceeding $6 billion. It expects supported capacity to reach $8 billion in the second half of 2027, on a path targeting $10 billion to support the expansion of its business.
Market coverage data showed mixed share-price moves after the results: one report cited a 2.1% gain in after-hours trading on Thursday, October 29, while a later report said the stock closed the regular session at $1,198.81, down 1.02% from the previous close, then fell to $1,167.28 after the results announcement, a decline of 2.63% from the regular-session close. For the fourth quarter of 2026, which ends on December 31, the company set a revenue range of $1,315 million to $1,385 million. It also forecast a gross margin under generally accepted accounting principles of between 55.2% and 55.8%. The outlook puts the coming quarter on track for continued revenue growth after the 63.1% year-over-year increase in the third quarter, while demand for power solutions from existing customers is expected by the company to extend through 2027.