Is MACOM Stock (MTSI) Halal? A Complete Analysis

The Short Answer

MACOM stock (MTSI) is generally considered halal by most Islamic scholars and Sharia screening criteria, provided the current debt-to-market-cap ratio sits within the 33% threshold and the Sharia advisory board does not apply a strict defense-end-market screen. MTSI is a US designer and manufacturer of analog, RF, microwave, millimeter-wave, photonic, and optoelectronic semiconductor products. End markets span telecom and data-center optical communications, industrial and medical, and aerospace and defense.

Analog and RF semiconductor design and manufacturing are unambiguously permissible at the activity level — the products are general-purpose semiconductor components. The Sharia consideration is the qualitative screen on aerospace-and-defense end-market exposure plus the financial screen on acquisition-financing debt.

Sharia Screening Methodology

Islamic scholars use several criteria to screen stocks:

• Business activity screen: Is the company's primary business halal?
• Debt ratio: Total debt / market cap must be under 33%
• Interest income: Interest income / total revenue must be under 5%
• Haram revenue: Revenue from haram sources must be under 5%
• Receivables ratio: Total receivables / total assets must be under 49–70% (varies by board)

MACOM's Business Activity

MACOM's product portfolio includes:

• RF and microwave integrated circuits: Amplifiers, switches, mixers, attenuators for telecom and industrial customers
• Photonics: Lasers, photodetectors, modulator drivers, transimpedance amplifiers, and integrated optical modules for data-center, long-haul, and metro optical communications
• Power amplifiers and switches: Discrete and integrated devices for radar, electronic warfare, satellite communications, and 5G
• Integrated modules: Multi-chip modules for high-performance applications

Analog and RF semiconductor design and manufacturing are permissible at the activity level.

Concerns to Be Aware Of

1. Aerospace-and-Defense End-Market Exposure

A meaningful share of revenue is tied to aerospace and defense end customers (radar, electronic warfare, satellite communications). Some strict Sharia advisory boards apply defense-end-market screens that exclude such names even when the products are general-purpose RF and microwave semiconductors. Most other boards classify MACOM as halal because the products are general-purpose components.

2. Acquisition-Financing Debt

MACOM has been acquiring assets (notably the 2023 Wolfspeed RF business and the 2024 ENGIN-IC acquisition). The debt-to-market-cap ratio has at times sat near the 33% Sharia threshold. Muslim investors should verify the current ratio at their preferred screening platform.

3. Optical-Components Cycle

MACOM is exposed to the optical-components and telecom-and-data-center semiconductor cycle. This is a business-quality consideration rather than a Sharia-screen concern.

4. Customer Concentration

MACOM's customer base is concentrated with a small group of large optical-components, data-center, and defense-prime customers.

Current Financial Ratios (April 3, 2026)

MACOM's second-quarter fiscal 2026 Form 10-Q produces the following filing-based asset calculations:

• Interest-bearing debt / assets: 20.24%, including finance leases and the financing obligation ✅
• Liquidity / assets: 33.00%, using $98.521 million of cash and $566.337 million of short-term investments ✅
• Receivables plus cash / assets: 12.81%, using $159.599 million of receivables plus cash ✅
• Disclosed interest income / revenue: 2.69%, using $7.759 million of interest income and $288.955 million of quarterly revenue ✅

Verdict from Major Screening Agencies

MACOM stock screens as compliant or doubtful, depending on Sharia advisory board methodology on defense end markets:

• Zoya App — Often Compliant when ratios pass and defense semiconductors are treated as general-purpose ⚠️
• MSCI Islamic criteria — Methodology view on defense end markets varies ⚠️
• Strict Sharia advisory boards — Some classify as failing the defense-end-market qualitative screen ❌
• Most major Sharia advisory boards — Approved as general-purpose RF and microwave semiconductors ✅

Bottom Line

MACOM (MTSI) is generally halal in ZakatInvest's qualitative classification, with a methodology-dependent overall screen. The current filing-based financial ratios pass the examined asset-based methods, while industrial-and-defense revenue was 41.8% of the quarter and remains a material qualitative question. Muslim investors who follow stricter defense-end-market screens may prefer alternatives.

For Muslim investors seeking exposure to the analog, RF, and microwave semiconductor category, MTSI sits in a peer group with Analog Devices, ON Semiconductor, Monolithic Power Systems, and Skyworks Solutions — most of which screen halal under standard Sharia methodology when financial ratios pass.