SLAB - Earnings call 4 2023 | Silicon Laboratories Inc.

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Operator

Thank you for standing by. My name is Jonathan, and I will be your conference operator today. Welcome to Silicon Labs Fourth Quarter Fiscal 2023 Earnings Call. [Operator Instructions] As a reminder, today's program is recorded.

And now I'd like to introduce your host for today's program, Giovanni Pichelli, Silicon Labs Senior Director of Finance. ahead. go please Giovanni,

Giovanni Pacelli

and everyone. Jonathan, good you, morning, Thank

We be the available this meeting, Investor replay will and a investor.silabs.com. for at section our are of recording Relations website X weeks on

website. accompanying press earnings are on release the Our financial and also tables available our

today our and Executive Joining business performance reviewing fourth Johnson; quarter are Officer, Malden. Mark activities. Labs, Financial recent Chief financial Interim Officer, Silicon They Matt President me Chief and will discuss and

update will comments We base actual statements include this will in any information today and materially questions as our take of important which the risks statements contained identify in you results these We the from us of factors those on SEC statements. call forward-looking to prepared are uncertainties. and future. We to could that our statements subject available to filings, that no to conference risk date remarks assume differ after cause and forward-looking these to obligation forward-looking encourage review our

we call the Additionally, in information. section Silicon Lab's, to now included during is Investor our call on release non-GAAP Executive results the Johnson. Silicon the our Labs will refer reconciliation Matt and the of A turn Matt? Relations certain earnings GAAP over press financial company's to of non-GAAP to Chief website. I'll today, Officer,

Robert Johnson

midpoint good everyone. the and our of delivered above The morning, results guidance. Giovanni, fourth Thanks, Silicon Labs quarter team

inventory. quarter, both we customer and the During saw in reductions end channel

represents destocking point to We during is revenue. prices. customer our in the inventory inventory than XXXX now unit of QX expect We levels Disty of low believe On lower end continue QX. a at basis, supply

start customers' ramping to we further begin of see normalize, starting We wins in expect growth and to to QX to design as benefits the our production. return inventory sequential

the continues management We've weekly slight be activity, in our to ability low. improvements but bookings also seen

was technologies, up by our ambitious customers, despite dynamics wins digits set. we The low in environment. challenges wins are expecting revenue with XXXX of are the projected improve. of lifetime These of and achievement applications market outstanding targets win range as growth broad year-over-year, line the in and design year the design power strong the we current design earnings We encouraged span a another of delivered operating double

team, On turn our John's instrumental Mark, to his a of of years the service moment to I to years he you GLOBALFOUNDRIES the success entire John, best Silicon has stepped as those XX and call gratitude we after for financial express to your work Hollister, we Before our over and like outstanding behalf who the stewardship of been as take thank and the Labs, would been CFO. wish ]. joined insights to John [ have over commitment, you, years invaluable. to partnerships and XX down has dedicated

to I to with for impressed that search addition, In effectively fit quickly engaged possible. the we're of new in as so candidates we're I the potential would and for forward during stepping Mallon search thank this also are the concluding transition. CFO share the Mark going like and and well, looking is caliber by our can as

it hand financial the to over I'll Now Mark update. Mark? for

Unknown Executive

Revenue sequentially Thanks, down million, of down mix. $XX basis. category on a largest year quarter, fourth same period for quarter and was The XX% last due experiencing from midpoint Fourth ended our the and business Unit million decline. year-over-year groups Commercial product $XX the Matt, morning, All in the in units customer in at X quarter. product industrial broad declined sequentially. year-on-year down guidance quarter was XX% volume and good a and IMP both the the above XX% business also with ] in unit down [ Industrial sequential everyone. and primarily declined revenue to the was

XX% most decreased was a XX% lifetime Despite XX% customer temporary ] our on its year, and projected to electronic full HNL positioned strength million. the growth sequentially down . Weak revenue we ASPs of quarter inventory. below the And mix and home $XX terms in to in and a down and are this life the shelf markets. at to commercial targets and normalize work the levels. the as well labels are and home customers decrease and days. levels, weakness, year-over-year strength our test units was H&M was [ initiatives due also high basis, driving in through impact to fee near-term level the shift [ XX recovers inventories Successful contributed and divestiture. The Health. their channel quarter, cities was expected smart This since lower by fourth partners at for metering. in quarter. in continue down the for as direct demand shift channel revenue. Distribution revenue Connected above in to well wins the achieved product toward in revenue typical driven with However, particular inventories sequentially demand groups primarily record inventory negatively smart design mix Inventory ] market the

revenue end from XX% shift. top level and and XX were quarter customers of about revenue increased historical trends Our by the the driven the for lower mix

at customer than due mix. margin to expected XX% and ended gross Non-GAAP product lower

restructuring, the million favorability. on the guidance, largely was cost $X.XX largely pricing exceeded earlier We and in continue by $XX significant the our of our XX%. loss pooling at generally tax rate commenced to due input than and the Non-GAAP Non-GAAP in effects of quarter. loss expected and tax expenses change Non-GAAP expected million, driven for rate environment a like-for-like basis no were next OpEx November. which effective quarter a of was operating better with to $XX operating stable see lower non-GAAP the

which million were million for year. our include margin the at better results GAAP operating loss $XX operating separation earnings $X.XX. year. the fourth million, year full operating GAAP an quarter full million GAAP associated for $X.XX ended during the non-GAAP full approximate was in for $XXX $X a fourth X%, for was GAAP was the year, were and GAAP fourth expected. gross for On was than For non-GAAP the margin the basis, $XX loss XX%. the the The quarter. costs per share charge the reduction with for and $X.XX quarter workforce expenses full

Turning to cash balance the and ended year of We million. with the sheet. $XXX investments

revenue receivable balance Our lower the million, $XX indicative the accounts declined quarter to in of levels.

days in our known customers. days reflecting back outstanding to sales debts no quarter XX from collections bad the Our and strong reverted

We to in We added $XX million turns about million. $XXX anticipate our internal inventory Xx. Inventory in in the at level quarter off that inventory QX. net will

hope reminder, our provides mitigate bank risk. in its a flexibility of portion As and hold [ we significant application to a die obsolescence customers and as inventory end-use inventory ], to ultimate which

We million $XX to our continue on revolving outstanding credit have facility.

in million. Our repurchase or Board of $XXX new a Directors program XXXX share has authorized

share well continue opportunistic market very on our as liquidity optimize will to positioned very strategy to manage be balance We and sheet and of healthy Overall, use remains repurchases environment. the weather we current execute and capital. the working the

amounts financial documentation the or controls week, There in no to controls. As our we statements. internal related last we current a to material historical certain was reported of inventory any and impact identified operation weakness our in announced

still internal process our in to material of manner. address developing controls weakness a and XX-K design to the Form a are expect the operating We in plan to enhance the of file our timely and effectiveness

Matt, returning first Before cover quarter. guidance the call for will I to the

in to quarter We anticipate grow revenue to range both expect the the units We first $XXX million. $XXX business in of the for be million to quarter.

margin We expect in first margin be to this cost lower the levels. continues absorption non-GAAP gross with to quarter XX%, gross reflect for and the lower fixed revenue quarter approximately

to operating We $XX non-GAAP the be million. first expect expenses approximately in quarter

the be in approximately to the rate expect non-GAAP quarter. tax XX% effective We first

back per On be now expect range Matt. $X.XX the QX be share to share we is call we per over loss expected loss margin gross $X.XX will non-GAAP approximately expect turn to to -- million, be in between we to expect share. I be and a GAAP Our to per expenses $X.XX. GAAP and GAAP for to operating of $XX $X.XX the basis,

Robert Johnson

Mark. Thanks,

array market in of QX, year, cities It's the and and partners this wider XXXX, CES of level X.X, of which matter-enabled CSA extends are the Matter connectivity, to In we our alarms. At of accelerated. we're life, more interest in availability excited devices, matter ahead smoke a ecosystem protocol. products including certified growth and air trends by in about appliances, conditioning matter well strong and the devices encouraged in coming benefits strong the commercial segments. with Released wireless smart as matter clear that Looking customers, the including to household ISPs several matter is as engagement regarding

accessible more Arduino [ matter we IoT our make this, development to advanced announced with of protocol part all. As ] in to collaboration

hardware We our are an efficiency first-ever ] ease Silicon matter security, leading intuitive partnering development in so use libraries get matter integrate to with processing environment. developers and software energy [ [indiscernible] power for labs

recently includes Samsung TVs label connectivity are market. appliances Silicon in matter Additionally, that and our smart selected hitting the currently announced the and

matter. a opportunities with wins meaningfully to growing chronic to continuous conjunction [indiscernible] and or for we segment, Wi-Fi are devices an lowest as an our Innovation engaged launch soft Wi-Fi Series driven this has applications. increase platform Samsung connected XX%, into expand SmartLink longer their market, of battery new QX, their X is for important on Wi-Fi on products dozen non-RE with portfolio work new illnesses health new diseases solution of ecosystem. devices, are The demand class securing Awards. rapidly, embedded category the they a like customers our drive more believe and are in excited as in connected We Wi-Fi was IoT in any Life design In power whole ultra where a in our role expanded the including diabetes. APAC products. In consumption lives matter increasing with to and power look is XXX health of X-based competing CES We of than as customers in glucose in their in products the wins by which the we will selected monitors. to integrate low we to continue demographics industry-leading of enabling The

are to solutions well. will gain that confident market serve continue and our We traction this

commercial environment to continue digitize. achieved In as our revenue retail group in XXXX, product record we

now Group. For shelf ramp electronic Busen example, with [ [indiscernible], ] we in SES new labeling, designs

design new space secured have In shelf in also and for wins our with moves addition, sensors solutions. the cameras labels, we ESL

with by However, helped levels. we're cities gaining wireless in increase smart driven also had year, which and was a meter market both and year by panels, and weak optimize The to demand share compute the energy inventory production record largely high a difficult solar first. XXXX for characterized solar integrated solutions also and activity

in things right moving its correction. direction, market through the seeing working we're still While the is

solutions and and return design to remains the gaining expect As sequential managing in team our our we Despite technology the we wins challenges, end those want and unchanged. near-term in expenses to stated, we volume, advancing share. IoT. the QX for to represents our I the for Silicon long-term thank closing, growth securing markets believe growth prudently trajectory significant Labs of execution starting markets and QX. In industry-leading within their

normalizes, positioned demand wins to inventory production, growth. return to ramp well design and are improves As we into

I'll Q&A. now hand it back over to for Giovanni

Giovanni Pacelli

call announce I'd Morgan Jonathan? the for March XXXX X. our Francisco participation open Stanley's we Before San in in [Operator TMT to like Instructions]. on Conference Q&A, .

Operator

line of Matt comes Cowen. TD Ramsey question first from the from Our

Matthew Ramsay

to diverse where question, some of inventory have inventory. you of for on the And wanted we times inventory, imagine certain on your guys you get inventory. about that's I end I we But I on but Matt, And -- and statistics having own and of see average the comments publish channel we my an during of situation. other these dynamics, a perhaps and first all pretty number it's talked your some still you're of inventory quarter, update tons in escalations products products an I products, some of a I customer think the take markets. set. guess

visibility? times and where And about So are areas up just more but cleaned if a give feel like And some inventories little you could areas not by maybe normal have everything if to there sort specifics of metrics, you you've overall haven't? of talking end detail, we're back average where bit you time and little you lead maybe bit spend that a market. particular

Robert Johnson

I think. I understand, Sure.

market working building inventory, side for to environment been we've Let's the see, obviously, this understood through going just by the well in. internal on design, by ramp other inventory start we're of I'm

it die as be As Mark bank, kind at. we where configure and we to that in said, There's ton given that we needed. can we now, of and peaking good of that's it a feel flexibility expect carry about

Next material piece about down level of in prices. is from going to lower is remarkable the We We mentioned. chain it at go that, that actual $XXX the channel around inventory million the we was down, channel that in also supply saw our occurred revenue actually days understood. million commented What's in well QX, significantly. $XX than came the as

So applications get that with you more of and can exact mentioned. And an a given technologies, difficult customer as customers that difficult gives just to to we the you customer there precision. which is have, get inventory like see the as pattern end can is number the because -- industry we inventories trend other the inventory, it's number inventories. report work the and with sheer already down clear you pointed out, the and trick ourselves The or most real those -- you can't that tries geos much on

see even to than last was we the that. And sample customers. down coming Last it see down. and not do were going well. That's of the you is customers we And top if inventory happy And if exist. time coming what and precision this that that. across expanded what to doesn't coming XX. is compare is average count quarter, it we're that's So down. to all with We you customers as to see we our I'm imply the more say, We've quarter, XX they should to believe

occurs. that So

product in customer obviously expect higher working saying, imply down that trend of lack our our as continue to we're term, we've minute to, for also it end through revenue those would is consumption and levels than been of We and channel as are, speaks inventories.

So which that's that put see not apply and specific there encouraging. doesn't but precision we direction, helpful is moving right hopefully, to going numbers definitely out in exist, it that the

Matthew Ramsay

does there's But a question, through context to that second lot help. guess transitory as of a I moving pieces margin, questions about period. I that few and going wanted morning. little bit this we're ask realize I a got No, I around, my a gross investor

see of So first guys it in didn't the question it. is just I mention didn't you to confirm, releases and any

any this confirm there true. So just that to I of inventory But write-downs? is explicit kind think weren't

get of is, second range the how might if within back guess I like imagine margin come the as any we rule levels us you question could a can mixed And segments of of gross give we the But out long-term it trend I kind kind this, X thumb of revenue between of as well. where has component any guidance there.

pricing. prepared You on was of a comments, mentioned in there the little bit movement

So But on I that well. was helpful. curious about would anything be margins as

Robert Johnson

Yes, and answer sure. picture the the detail then I'll bigger to work up from that.

the absorption [indiscernible] what really as it expected. gross thing cost the came reason from than is that low level in is was call first guide for term fixed mix. low the lower driven even And margin around the but So -- level. the by that beginning, at the really revenue that I still

normal resulted of indicative an do is that which revenue, we're in come customers our And go to of that mix operating a million in expect the where permanent lumpy, that we at. consumption $XX right? level, not At unfavorable or be trend. a

we but costs. in should than -- challenges, be have we'll So consumption want still those level to we all and fixed clear, those lower absorb QX, revenue revenue than lower

normal, think that's be To in challenge trough gross said supply were by in critical. be cycles was ] and peak the I your question, meaningful of we longer-term all during our we picture [ over know So chain new indicative we looking margin we expectation there the of as the gross QX, slightly. we amount, no. our that although should answer a Back still of peak prices, this, could improving an see or margin the the And these at trend. XX

we're We expect Right our in that's environment, that indicative and a believe also transitory trough, out. that's don't that transform. We proven gross and long-term was believe margin. our now, we that's of

all to expect model we path what and is margin see and have And to Our cycle, continued direction this along we've get that. to said that through we to a delivering our that's gross not changed, has see. we commitment unwavering, just

Operator

our comes And Thomas line next Barclays. from of the from O'Malley question

Thomas O'Malley

quarter of guidance? you're check that's I guidance as which what the in March you thus playing the seeing the more to and to pricing Could also, to just grow that to with from color were perspective just fourth you quarter wanted expecting far into mentioned talk the in units some of can ASPs first and ] $XXX [ the of reset. quarter to kind down out how your through the as March quarter. your segments just into But us about get March both a expected you're million. then And give you

Robert Johnson

Sure, is Matt. Thomas. This

So would that is really tough our to both industrial probably expect we through quick Life environment, answer cycle in and picture, end further Home on segments, call Big segments QX, this to commercial. market than of QX. it's I but its believe grow & ultimately

calling if would So there buy expect but more our we're to specific not in is, I guidance. numbers were I

the In terms overall, changes. big environment pricing of no

setting not I lower or environment. lot that in been us, So doesn't very just much for But worth competitor are out. But capacity. mean one business aside It changes there. that price trying that out our to about with debate by -- it that type and I typical the significant. who behavior price to running. demand that and is this from call surprises we're what outlook is seen there saying drive on And honest problems, say so we're in or very things that far. that, everything incorrect I justify points fast experiencing capacity based environment. And their commenting be and done to ] and our would indicative is competitor to fill portfolio, get inventory through. price trying trying our up not to But has up a seen fill so we've indicative of there expectations line X say if that of would people problem is it, that what don't overlap expected -- No back and But big and drum is seeing we've is if this going market the normal, the [ in isn't no we've what cycle

Thomas O'Malley

report it controls that Super of maybe the impact helpful. little inventory you're here to the A split moved the if color of to you're any It couple a much really can? And looking up. of as would now I that in the you then two, if you I die not follow One, And you bit looks due seeing of of bank be is that Could right just going because carrying you give like die inventory more wanted on quarter. maybe bank. could to what's inventory controls, Obviously, things. more most us give issue. inventory us products. there, assume would you mentioned that you for is at were that how

smaller inventory. assume of be I color a would helpful. overall So would Any portion there your

Unknown Executive

is Sure. Mark. This

in we For identified some issue areas the needed January, some controls process late inventory there. within that improvements our accounting

the the to than to and working forward. are address more in it work, that it's process we're speaking, have for controls new going X the things to way least plan have these quarter. generally at shown develop effective to We going

documentation out it quarter. aspect over go had general, item But the the some inventory judgmental having with at the first that least and valuation. that the open do in through of just into reviews more of So assumptions have we'll there, to

Robert Johnson

because have our people we in in while in importantly meaningful a do that What not customers our to majority just diversity applications. for Silicon. have just and comment, end there understand inventories diversity out we try same And to is Bank Di of remarkable

sorry, address much figure customer So I'm that, applications to in and term, market and to for top is And they SoCs in Silicon that better have -- software Silicon members of needs. part be as we'll to address, lack Silicon as there's possible, on substantial of of flexibility can as well. different SKUs that customized tailored a

to a die taking respond for So by to the gives and manage it's bank advantage responsibly really us us to inventory carry and maximum approach. that an flexibility

is, answer that's in. of quick most So it where is

Operator

question next Stifel. from Tore Our comes the from Svanberg line of

Tore Svanberg

& Home First on question is business. Life the

this know I it question Matt, anyway. but difficult a is I'll So ask answer, to

run So of I it billion. rate think a at $X.X peaked

Now the million. is $XXX run rate

of could mix much what quite $X.X how peak, wondering that unpack And little businesses. you that was but us consumption know, And it's that but some had you that if helpful. unpack the it's cyclicality could million, business be really assume today, as business, "more number a So would stunning. if is great. $XX would be I'm business." bit more and give that, going just what secular a difficult, look that you color I versus was I you you're true And of billion more of cyclical not again, to if can you add secular any at

Robert Johnson

easy be Yes, Tore. to provide will that context is But to and sure, Yes, graph that perspective hopefully answer. some my helpful. not I'll do

consumption point So year. haven't that want But to consumption an can meaningful you number for breakeven or company segment. the with OpEx in there we maybe up do exact consumption be some QX big the just remember for your were level. did helpful those mind. provided of be to the you it going that that way for And picture, below whatever top, to And of actions level obviously, cuts, do we last

So think way help that's as it. conceptually important about a to just

we've basis as some low the ends do some out quarters remains It's a seen in more much that because need. that visibility but I within seeing that they lead full in home they're -- even improvement people optimistic aren't about bookings, push X-plus not call, ordering ordering of signs shorter times, into anymore. Going now line. declines what It's cautiously seeing been see, X, business. We we're

they're their been they're They've uncertain. I think inventory. still working rattled, through

of level encouraging much do not correction, woods. at we're and this the that further of we're say the cycle other seeing but side the out I yet So we're through signs, to on or

said, demand People be to we out right, the build have went want people tease a services one, that a out think there shift strength, yes, have journey, levels So from being is well, how be back But or you remarkable buying I goods market perpetuity. pull clear. That And -- then would continuing I the in you secular services, from was are bunch trends demand to difficult and want much to demand that under end there's inventory. through or positions right? out contributing very are each. whole of then a there to parse that important, expected to

starting stages, show Life at in really Matter then there we that secular that Life same started the strength on the be a about momentum just with is of strength. to time, the early throughout win lot that impactful because has in well. been as But our will design prepared durable talked times this in its remarks. that we've few world sharing and And of a

come. say throughout those I'd yet resilience showing impact to ramps and So starting, is there because it's of real growth real this, because but that are the

only share there help solid to and and for as convey is and as on we're position the in great will the and I'm end end piece other our there, the really finding -- Bluetooth confidence but we side as our What thing very last such trends market such as to remains a whether progress trying to bring that Home just in home such the not the strong strong. that see of as this grow downturn. Amazon in is the firm do from Sidewalk, in actually clearly matter, confidence piece market, or So where going And moving opportunity remains very forward. growth gaining segment Wi-Fi, momentum continue us an same we're stabilize home we is the our splitting perspective also it's around

know space for moving I -- like punch trends, through a worry, in We lot see some that's some share, And to is to be opportunities line confidence matter, grow we I we're Wi-Fi those going to of continues the strong. is mentioned, gaining growth, those all and of Bluetooth our are know in the So forward. growth there. but pieces the

Tore Svanberg

No, that's appreciate I really that, helpful. Matt.

balance of obviously, there's I coming follow-up, lot wins. new my that, design As of I But a also you so know pretty That's obvious. cyclical top know, on a have here.

You have some new ramping. secular business are that

about talked glucose metering, of Wi-Fi. some shelf metering, go smart then labeling, You you the

that update So I material here especially some real some those of of the I calendar cyclical there? 'XX, guess revenues look question perhaps really the in be for a at And such light to have newer could if any low business level? is of you more businesses, these at

Robert Johnson

of ramp. we're impacted confluence see Inventory Understood. yes. but here. of That [indiscernible]. unwavering not cycle see direction. is the do out that those calling designs answer fully we're that's our comfortable to Quick We're to necessarily, we that vicious right stocking are rate calling Yes. particularly starting the that we've And our things expectation a market It's clear, not in And the that trying these those is through we're we're the that all and in We strong, the but been are doing calling is in market view going and our going has be not woods reason demand. destocking the substantial. the we through, worked is yet. we're the market bottom clearly cycles position inventory do have

with We just of. its a like just call things called work this And of. counterbalance -- ramps looks those together, perspective more it through there's happening. we two at that those this last to cycle. happen. called few a give when market continue to stronger are were on Yes, -- be unaware call, positioned some that X point, when the are those massive some market the cycle. going earnings people growth strong But will more will are people they're a there's for and couple And things come that these and normally get out intended out We unaware we'll

Operator

question from comes next from Acree Cody the the our Benchmark line And of Company.

Cody Grant Acree

Maybe about last talk days. you the linearity can throughout just your XX order

that coming you pattern request. bottom? you gives and turns about You talk orders the that your mentioned how just with in less of typical that Can to than are visibility orders

Robert Johnson

Sure.

don't now remark. this us So It's normal I'm because not been for has hard cycle. want -- to entire trying is a what right over disrupted is make I really

on lead with that. to increasing encouraging your say, other roughly, not the always is be directly, it they're -- answer a within in level say, optimistic customers we'd direction, but they're on our is done. to of days, most are -- question like customers as see is to is But which XX continues start this majority direction the that a going behavior of increasing last quarter, visibility -- I'll And well side because at little time quarter. a that right an to So the over We're a that. in low right we've and trend where the what important. The seen let's just the of now,

gives you of that seeing. we're an So what indication

where out seeing for probably between -- little cycle It's that pointing also segments, worth given lack term, of the think order and industrial we better a the we're consumer at more general said from do through of like commercial. and indicative to QX. and earlier, grow I than consumer cycle expect But being QX both the further and industrial we home license to patterns

right the further and give headline in direction but helps perspective. context that to hopefully, So some going still go. have Simple

Cody Grant Acree

update this Series about little optimistically pretty on talked absent progressed that an you just give you been a has quarter. X. platform this quarter, Last us Can how has quarter? That

Robert Johnson

work. just Yes, sure. design, a in the by Not lot of middle asset of

powerful X release progress to that's think the to still Design on excellent. have market. you'd has continuing going going track with couldn't the growth It's as a committed about time. that been We're is that, we're quick a X, And said, we it's products there on everything X. way to want on a us in expect that to see. have cycle on drive be it, happier spot what making but life Series impact Series only momentum wins, to on industry. our for in impact for we've the then long Series us very not a So to company but its to and

whether even gives customers X the further industry-leading that the that the on. even whether and An to which to or it's so wireless including easy want, security, quantum way leading being platform Series the think our it's all compute on lever it dimensions pervasive, flexibility, Series performance, is that we scalability, are read. is X about AIML that whether industry and takes it's people that ability push

probably will years of cycle, to that in well the be coincide want I into be it. least of call, X our talking to excited. But and about but each at we those XX still, to Series both Series are customers with and next come. So or where we're talking parallel years X combination why the for it's at to -- us comfortable very that will about what be noticed don't the be things you for years not come. do we're for have other, And kind work for we'll And We're years. to X for we'll

response. the have about that important it's One it. it's not very both we at customer perspective away to encouraged where replacing market So talk going other as X, But is is not by and of and those. the Series

Operator

the & from Company. comes question Needham next line our from of Quinn And Bolton

Quinn Bolton

it's just about some I to encouraging further you life said home of inventory more through to talked and in sort -- orders you've the also and correction. starting wanted see

sort Just you wondering under run talk more quarters if what to industrial before to expect kind quarter about is you & in, X get of more kind pressure to same X & to X could that Life the Home X of you Industrial back rates. specifically have would commercial side. on Commercial seeing normalized of you're

Robert Johnson

for and Yes, There's answer interesting marketplace. sure. behavior question. really out know I some understand in don't Quick honest we the there the is

a a saw we us, much decline as For consumer. of start later than industrial enter

I across we really -- historically, it's measured was where for much But see going I is typically, really think usually, of remarkable our was us the abroad. as did that more was just really time not from What of thousands softening. customers, slow and seeing For signs around down guidance. big and reflected to in really we it usually started think QX, QX segment us, that

been yes, is, as a how a in the into sense the and so quarters see it, -- typical that hasn't X So few I reason also we're cycle we correction but it the of severe. explain

able also and done is we're with still said, in market did our it or believe going seen some the go. as and few still So from even bottom But drive trough growth we quarters. go for sector. see the we to the continue abruptly that down to this assuming next this here. sequential it's And being and call with haven't wouldn't we caveat, has But I Industrial to as as time we current

Quinn Bolton

Got Disty a then inventory. on just -- the it. No, that's And helpful. question

going the obviously, just you mean, still level. lower if flat I hold Disty's of you're said revenue pretty of shooting dollars, imagine days a kind down nicely. the Disty. came you guys come ton for have guys inventory terms that XX that and to Disty that target starts a You I as it recover, to down revenue Do given days, in to down

any inventory thoughts to that be can give us should where just we -- try get thinking you how Disty about you where want So to

Robert Johnson

XX-day see target, revenue valves work much/lower with everyone have said very in and whole back as to Yes, whatever normal XX- quickly that, now, that And to not be the to pointed right understood. up. obviously that past you on inventory the hard things But than I inventory a target. as you ramp spooked the what a It's there. the over now, but out, quarters, is times, or something an we'd spike counter could industry Yes, But that's level. right out by range right? happen, trying it's And last start you down range. but think those somewhere to we've few higher absolute in in that as a

So distributors work it are are work to to it down. Customers trying trying down.

we'll far for us to best problem and which manage child and happen, far. of but possible focus down, we pendulum it an right than probably going those there'll responsible We're side the industry. done. is it real doesn't watch be inventory and because to little about this which that. honest it's inventory the go direction, too on be see the to Maybe faster that you'll a too not that but we're in But will take industry, the as if trying do it. the our then other that's be We're trying an is levels swing X encouraging, anticipated So times it customer balance as is a end

Operator

next Securities. Wells the from line of Fargo comes question Gary from our And Mobley

Gary Mobley

but I wins I missed what that us covered briefly you was hoping in and module with to you share on on there any the or the be of presume emphasis as in was was or Matt, standard specifically lifetime I more period. helpful. generation. X majority X is value growth honest. could whether in X. this for would it, wireless metrics would prepared a in your remarks, be on design not retrospect, the well Any design Series captured particular the it wins color

Robert Johnson

sure. Yes,

environment. the So because we mention deliver design we yes, target knew we I this market deal that well. remarks target, last think think did it in great second a we remarkable. our and saw size be in a the year, in prepared set but said be mentioned different year And I our I'll XXXX. entered why a a we to as we as But as it big anticipate as win We would would environment, and didn't that's we

design it real see drop like think the did as in And multiple. right has that as you and terms win volatile And market usually, about reasons you Like usually, performance. are your and it now. been, convey it see impact when the

growth. our park, the And impacting in -- it now, performance that drives driving the of away. to easy it which to able of be our knocking Series that is still things the Series play. design that phase with inventory And But now have out of to which also win team come a R&D X, We secure leverage that that in way of project revenue right? fund customers that plan, the in that we're have that's think is and will and the is But it's that the was There's in and in business. ways that driver certainly right design because off. work. A that's doing customers reductions, not the on major and said about are that's XXXX, funnel opportunity growth engine very that Series performance revenue customer outstanding. And position lot All X a drives portability can we reason we're was X happy trying but about earlier, into Series why because are growth, the the working way. of to investment an our is so I software wins. are serious design investment Series schedules win compatibility as so excited X realizes with be market, through those is direct we knock deliver the that what design original yet. to in X, We're they're still

platform starting we're in get to that that mass serve So with industry. will us critical position the and our well.

the other all saw of terms market in focused saw saw good technologies broad, as good good progress. our geos wireless pretty our all terms of honestly, well. it In end question, was all And segments progress progress our

would progress impact. great seeing it areas we wanted you about Tory that cleaning having growth up big call you in out be were some secular with definitely where to one, If really what just big expected. earlier, those we're Areas talking a

we've call just we we start areas, we've there. in that's you see there lot bring wireless X and consistent as strength our take soft we an And capabilities could as continuing all like take seeing Bluetooth, we I same Wi-Fi the Wi-Fi, withstand where a saying, off now. and you're probably from industry-leading seen just for as and well. released expect that the going out see area Bluetooth, And been perspective, really we've to then share that of grow in ourselves to been design in but win

drivers, and performed we well, the Hopefully, aside But no from So destination market focus the areas you one those some very thing perspective. Bluetooth. are our that strength Gary. gives all hit But in

Gary Mobley

Matt. Thanks,

for at to weeks calling pretty . form leading-edge XX lead of of related a a rebound good lead you're basically see is pretty year? rebound is lithographies put expanding are that higher partners point year a maybe going see foundry quotes And possibly as this at, lot realize main some some than times question, more you foundry some not I to maybe Your times but where in the in we growth. well could the potentially a and good

Robert Johnson

for Sure. question, the sure. Don't understand

bank [ think build inventory ] about to strategic been that out. smooth our our we've I this very X deliberate die internally,

supply we the crisis, a lower into much Going were carrying level.

the to intent be not monthly. we our our have to foundry And partners, all with largest. have abrupt that as smooth and by try our response having is and great relationship our So it including a

and be that die learned partnerships, customer just We're carrying other the inventories, very our able supply blunt, definitely to we I this prepared. a to lot feel forecasting, of lot. the to So able believe about side with We've relationships we prices be navigate were We've navigate we're think better watching et cetera. bank. I different learned in. And a much downturn we're we'll

as I So I very those And perspective, from navigate all a all to considered. think confluence things the well believe -- do position supply well. of positioned we're

Operator

Pacelli Does to for further I'd like hand any This back session conclude the question-and-answer today's of program. Giovanni program to the remarks.

Giovanni Pacelli

all today's morning. you concludes thank you, Thank Yes. us and Jonathan, call. this This joining for

Operator

ladies you, program. conference. Thank today's the This does your and for conclude participation gentlemen, in

disconnect. You may day. Good now

Silicon Laboratories (SLAB) 7 Feb 242023 Q4 Earnings call transcript