MaxLinear (MXL) shares tumbled 10.69% over the past 24 hours, erasing a significant portion of the gains built up during a powerful pre-earnings rally. The sell-off came despite the company reporting second-quarter results that exceeded Wall Street expectations and issuing a third-quarter revenue outlook that was far above consensus estimates.

The decline was triggered by concentrated profit-taking after the stock had surged 7.95%, 5.43%, and 7.93% in the three trading sessions leading up to the earnings release, as market optimism around robust results was fully priced in. With the earnings catalyst realized and substantial short-term profits on the table, investors moved aggressively to lock in gains, intensifying the selling pressure in after-hours and overnight trading.

Valuation concerns added to the downward momentum. Wall Street’s median 12-month price target for MaxLinear sat at $67, well below its recent closing price above $86, while the stock traded at a lofty 52 times forward earnings. The company reported second-quarter revenue of $168.85 million, beating the $164.7 million consensus, and adjusted earnings per share of $0.35, above the $0.33 estimate. Third-quarter revenue guidance of $210–220 million dramatically exceeded the $173.8 million analyst forecast, driven by accelerating demand in the optical AI data center business, but the strong fundamental news was not enough to offset the weight of pre-report buying and a stretched valuation.