QRVO - Earnings call transcript Q3 2022

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day and welcome to the Qorvo, Inc. Q3 2022 Conference Call. Today’s conference is being recorded. At this time, I’d like to turn the conference over to Douglas DeLieto, Vice President and Investor Relations. Please go ahead.

Douglas DeLieto

Cody. much, very Thanks welcome fiscal and earnings third conference call. to everybody XXXX Qorvo’s quarter Hello, include that materially forward-looking that will call This statements our expectations. results current could involve actual to management’s differ from cause factors risk affect We risk encourage Harbor in associated operations as earnings filed our the on with well the the factors our published because as our risk with statement Form results. annual today report contained financial release the to you review may Safe factors these business SEC, and in XX-K In today’s both results. release and call, we on GAAP provide today’s financial and non-GAAP We may to to additional analyze this trends performance. underlying obscure or of investors and comparisons without performance to expenses the impact in our provide perform supplemental information financial certain results that of items operating non-cash enable other

our During results. non-GAAP comparisons and primarily statement to based be items comments our call, will on income

website release our a today available of refer For reconciliation complete our to qorvo.com to non-GAAP please issued earlier measures, at financial under earnings GAAP on Investors.

are today and Group members President Murphy, to Financial and Bob President us well Creviston, Products management of other Qorvo’s Joining with And as will team. I turn Mark Qorvo’s Defense it Chesley, as Qorvo’s Infrastructure President Mobile Officer; of Group; of CEO; Chief that, Bob. Eric Philip and Products Bruggeworth, over

Bob Bruggeworth

architectures. mass and complexity efficiency during are diversity, of driven Demand game Doug including XG Products, outlook call. we power other The lifting XG device categories, solutions. our everyone, requirements third fundamental content network X challenges ultra-wideband included quarter call. midpoint management Mobile our multiple to above across increased and XE Wi-Fi markets, earnings the power devices. and the product by welcome carrying quarter in the provided Thanks, and flagship Qorvo was XG transmit X for delivered Qorvo results content new fiscal and being on broad-based November market the and In

combinations long-term impacting in aggregation, both are bandwidth XG of from are receive independent In to maximize devices increasing and the bands, to trends new for and XG requirements These addition transmit band carrier tier. to device. the

new increasing more designs addition, systems. advanced industrial In foldable challenges phones RF antenna demanding like management are

energy Lastly, Qorvo’s grow wideband is based renewable a new competencies and demand enabling can our revenue enhancing us sensors, stands maximum and OEMs, EVs, offers integration categories product higher in technologies MEMS in same key cellular emerging placed leveraging that participate smartphone the as continues connectivity RF, proliferate. because forefront proceeding portfolio chipset is IDP, Qorvo was power ultra voltage stations providers. ATP applications include and across in Qorvo broad-based broadly opportunities Wi-Fi of More Qorvo like broad markets. mix, increased across Silicon sequentially includes critically, and In at and to benefit tiers charging of to portfolio and connectivity to growth These well The of the Carbide efficiency. United that markets. systems. Qorvo

let’s look starting quarterly of with at highlights, mobile. Now, the some

ecosystem. to the are opportunity supplying core milestone, ultra-wideband Android the strategic main path support complete achieved smartphone market integrated solution adopted ultra-wideband, more our shipments first We expanded solutions, solutions This a of sampling as smartphone. and which highlights as mass increased in an For In customer well technology of these launches. transmit smartphone content broadly. architectures our in flagship we we secondary Korean-based speaks an strength OEM, important as across ramp the Android highly and of

be BLE ultra-wideband wide of enterprise For integrated address continues applications, robust. industrial solution activity with Wi-Fi, design enterprise combining range a industrial to module Nordics fully and chipset a and applications. introduced to we our In

design new superior customer FEMs, performance X and flexibility. X chip-on-board offering secured For engagement mobile design began reference applications, Wi-Fi and sampling Wi-Fi have we of

power in X released Wi-Fi supply automotive Europe-based chargers wins X.X ran design we connectivity we networks to a In and carbine BAW filtering OEM GaN for in iFEMs cellular technologies solid-state and station see automotive, and gigahertz drives rest infrastructure, processors to excluding automotive For to and for with watt are home strengthening applications, gigahertz by We power was support significant our combining worldwide, onboard superior DC-to-DC X cellular video was Qorvo applications. of tri-band efficiency for To amplifier of were high-power enterprise modules secured battery-powered our world, base Europe a strong as XXXX power, the expand in converters of power levels PMICs to Qorvo for massive in and motor and FEMs of deployments Asia. the XG growth solutions selected with X.X XE for and deliver China. supply we Sales tools. VXX provide control silicon management carbide market infrastructure applications. franchise, leading were MIMO leading sales In power OEM. OEMs to silicon for mesh in in selected of In for Europe.

products automotive. awarded bio, first a RADx broadening were million antigen infrastructure defense and a assay with Our $X.X the In markets, we flu the and a NIH the COVID initiative supporting to combo for COVID portfolio are pooling application. contract additional including and we industry are serve follow-on

submitted in settings. supported agreement of Qorvo application is drivers IDP, both partnership deployment expand connectivity, care and the We growth waiver diverse the power. multiyear also In in XG, signed by to clear IoT and mobile distribution to and defense secular a a for FDA capturing point in channel U.S. opportunities

over hand that, the while sustain markets the our I We and well across call expanding product to are investing And technology Mark. leadership and we operating will to serve portfolio. with

Mark Murphy

and was everyone. million revenue expected infrastructure the points was Year-over-year including Products the was million billion, XX.X% the company acquired stronger lower company’s partially in above the by of power up over and was our at payments quarter the $XXX the incentive net $X quarter’s our Thanks, operations fiscal discussed on million last associated $XXX midpoint in was midpoint on third yields. basis were quarter the and for comp. gross quarter mix XX Qorvo’s offset long-term above afternoon year-over-year. sales. and December quarter quarter revenue Non-GAAP million, on management of guidance. volumes. and above million, better up $X on the revenue programs. was quarter Infrastructure down sequentially consecutive $XXX $X.XXX diluted of incentive sequentially guidance supply per expenses Defense recently operating and the investments, development million XX.X%, XXXX Non-GAAP programmable $XX guidance. $XXX in OpEx quarter of third of with $XXX flagship in This was the product and Mobile third $XXX – above and of XX%. third technology reflecting fifth share on income million, Products compensation operating was million up million was year Non-GAAP Non-GAAP December our higher than expected with the good of timing income margin flow from $X.XX Bob than in new $X.XX midpoint and was call. OpEx earnings lower agreement was Cash

differentiated customers expenditures agreements product more position their As simplify address allow mentioned then, collaborative building planning. Capital believe supply needs. term and is long-term we provide such partnerships cash our and us quarter. in technology position our differentiated to and technology advance to and longer Qorvo we we million Free assurance million during supply $XXX to enjoyed and $XX the shares $XX areas and were was December a continued of as million in BAW the repurchased where and growth. flow GaAs, quarter see remain concentrated and core our

and low based to our repurchase shares leverage, outlook, We on other long-term continue factors.

from Turning to the December, first balance note $XXX part The used million X-year to Qorvo loan. proceeds retire term in issued its sheet, were this note. grade our in $XXX million investment

billion debt cash. billion we had of $X As quarter of December and the end, $X of

debt net to turn. increased to EBITDA Our X.X over

our gross and billion $X.XXX to turning quarter of Now, we non-GAAP diluted revenue of share outlook, per XX%, between $X.XX expect guidance. margin at earnings midpoint non-GAAP of current billion, the and $X.XXX approximately

revenue March and Our an IDP quarter supply situation, volumes. stronger improving reflects smartphone high-volume outlook launches

Forecasted the $X.XXX is of midpoint sequentially year-over-year. X% at up billion X% revenue and

phone IDP growth flagship the and quarter, over and a million. gains mass return supporting sequentially supply tier We year-over-year X% We with mobile to and around up in revenues to more be content March year-over-year $XXX situation. expect demand flat launches broad-based project demand to on stable and

full year. We fiscal capabilities quarter to of increase guide XX% March effects. margin outlook as last approximately to approximately well year core as payroll to and non-GAAP quarter in expenses gross new ‘XX fiscal technologies about than in operating year due early $XXX results increased Our project in points higher basis March investment calendar million the XX

to $XX million year to Capital quarter income the tax million We year. expenses our be as from with For approximately non-GAAP the projected is project net rate multiple current rate projected Below other in to around additional be expenditures the long-term are of down of full OpEx operating be intersect customers. XX% spend $XX to XX% to we X.X% the just sales, will increase demand approximately over year, our line, close last quarter fiscal and the sales to March support fiscal the and debt. on manage supply X.X%. agreements in be full to

our and fiscal areas so remain We in beyond constrained still supply year to forecast end. are some

along exceeded support continue to and of our assembly the In to results We with expand midpoint summary, capacity some guide. our quarter GaAs BAW test growth. and December

current the We $XX.XX, our sequential over be At with March approximately consistent project we in midpoint including the XX%. margin our full EPS fiscal year-over-year. fiscal operating revenue is guide year quarter and guide, quarter over XX% for XX% March growth Our previous ‘XX, year comments, up our expect to of quarter. growth

to and year, deliver well-positioned fiscal this cash serve power flow. growth beyond in Qorvo Looking and earnings in secular trends and is to growth free connectivity

over mentioned the business Qorvo’s looking end last market highlights the years. by several quarter, growth at As next potential

We use RF we expect strong smartphones solutions, support and double-digit trends. expect content support to finally, requirements connectivity for increase increase increases proliferate. growth up XG we solid to outside grows, and double-digit complexity products mixes XG defense to connected electronics, for devices our spend defense advanced cases performance as infrastructure, expands. mix growth picked China, On cellular expect and power as broader power build-outs growth as markets higher of And and electrification on semis

Cody, please the for open line would you Now questions?

Operator

with We Absolutely. ahead. Toshiya from Goldman Thank Sachs. you. first Please go [Operator take Instructions] our question Hari will

Toshiya Hari

kind front. what that that kind my afternoon on quarter. Mark, supply supply bit, can little Good the is capacity also then you you and constraints, match and expect going describe a forward? on your if quarter, a you so but of saw for constraints guess guys. noted from what’s and around of the eased gallium I last in Hi, be you to about supply the current issues to you elaborate taking also which kind that the quarter talked customers, in supply perspective think thank of stay that mentioned part but Qorvo you question think question. internal you I you seeing the embedded of what arsenide you constraints are guidance beyond I first helpful? would much are Can on

Mark Murphy

Sure. we we continue most provide the and the disruptive I have the add. start quarter environment further call, others these year. to expect as in the it To effects, quarter this to they and in view And supply supply Toshiya, X the largely impacted chain seen expected. we calendar best could on improve question are complexity can supply the did of your past and demand will and play years. during and we last moderate effects chain through the in added We specific midst Yes, to out quarter’s the effects picture.

improve March less but pockets specifically some shortages then still continued we even In did December here Toshiya, quarter. chipset in is the disruption as businesses, quarter, that the expected. though in we there it supply expect still disruptions COVID-related than to Wi-Fi, and which business. are there, the some So, and we impacted expect it there some other And chain, we seeing is supply on be defense

Bob Bruggeworth

we in The Toshiya, are add thing our made gallium on have capacity this we is arsenide shape pretty Bob. and bringing good significant I’ll our only is there. in in progress

of our our some power silicon connectivity business progress some see We of there. In there, business, management business the good there, tightness with have supply our systems made along we still there. in IDP

expect do throughout So been through we the quarter year. to and impacting as out, improve that’s us. But pointed Mark the things

Toshiya Hari

guidance Yes, for the I for seeing How my any are ‘XX so playing past IDP is Mark, the ago. may the sort follow-up months or much X as quick to March guided fiscal have see mobile of had those you what may though, consistent early, then U.S. mobile, a with mix, I you that’s and within and you the for And super out? to guessing on as the Thank guidance in X looks and evolved Can think speak changed, that, And both great. you have margin know over would am any in it’s months. sort to particularly ‘XX, China? gross the in what Thank context. helpful as regions quarter, provided mobile follow-up, the Korea you you respective be broader you. revenue guidance of but I well? on fiscal regions pretty

Eric Creviston

across Eric. Yes, had Toshiya, a lot would I We expectations. our our that design platforms channel. them. looking mix meaningful mass of customer bit as quarter mobile. and we did we back into expected when this very mix due some are last see is was well. start There December new Korea of in No the strength will wins clearly sell-out with to particular It’s earnings ramping out a we in data call on within shift in the between see our with flagship base. And the shift those China tiering mix playing changes consistent

quarter, far, to So are moderate this but early we beginning back normal. it’s to in

what changes versus expected. So any we really not significant

Mark Murphy

we is calendar Toshiya, on call. the more profile than ‘XX timing typical is on this of fiscal gains the we March provide will guided, based year, IDP the say content and phone stronger ‘XX launches, we Yes. on and our of the this can what know of based we demand. that’s on and quarter earnings fiscal And to next plan What ‘XX on beyond our outlook rest

Operator

Thank you.

take question next We Ackerman from Karl with Cowen. our will

Karl Ackerman

Yes, you. Good I Two afternoon. questions, thank may. if

you your largest the May in revenue on First, contributed customer And I clarification. the a comment a overall contribution, to quarter? follow-up. have

Bob Bruggeworth

largest year, we the quarterly largest we you know, find do the at don’t clearly give with you what we end report we of the K will was. our report customer you’ll our that as what Karl, customer, when

Karl Ackerman

I try I Yes. luck. my that. appreciate

Bob Bruggeworth

Karl, we consistent are though.

Karl Ackerman

that one the handsets capacity from XG limit concerns is of adoption is investors That may true. Hey, of year. the on the guide, constraints this

Wi-Fi sold, Android While number you sounds like from being I devices. content was less well the UWB engagements wins, over what gains you control design midrange have phones as you XG flagship as see hoping discuss the collectively of opportunities share in for could across

So you. that you that would if be just Thank could helpful. discuss

Eric Creviston

Yes.

affecting would modem think chipset constraints assume So are the the I the of guess XG, chipset I there I business, first extent amount regarding part those the that it constraints of are prioritize going to suppliers the XG side of technologies. in to and latest

doubt look our we that’s are we to going base, under be XG. customer factor. So well major are example, shipments their for China When half at, they a still

So than that shipments, the the be they I market, have XG XG, export of probably will lot a in especially more impacted think. got

the with quarter gets and control, lot for looking that of and a foothold rest proven, devices makes the a yes, products. modules we put about their the already course, are Xiaomi, pleased ecosystem. UWB. software us tenant our and connected we’re across So but And the wins forward, in UWB. that last for XXX talking It’s example, space consumer for talked it about really across lot of integrated also, for the stack Android launch great easier we’re home together content to beginning Android UWB, with of And a to beginning go home whole we

year. control the based our of management, Qorvo. power the trucking that, modules then power based to – from strong, systems, definitely course, integrated as in both exit solutions we continue APT, to we antenna management next lot see average to So great. be And NIMs fiscal lastly, And a ETIC then traction that’s NIM addition generally, of getting transitioning power and

yes, throughout for of of lot strength lot the areas a year. potential a – So,

Karl Ackerman

Thank you.

Operator

you. Thank

hear Arya of will from Bank Vivek We America. with next

Vivek Arya

questions. Thanks for taking my

On said the first March I one, that you just is to stronger clarify, Mark, thought typical. than

say that about So seasonal what versus trends? does June

Mark Murphy

of in finish a question, it’s from we fiscal question. going year. fiscal answered earlier about Vivek, the until I any refrain Yes, year as good sort And we’re next to talking this detail

just sequential discussed any But in call. it’s as year-over-year And we we’ve some happen. were that depends it’s environment, the and that given June the this to And of too see situation decline March, earlier. on to in think point quarter. out, June. It you early if volumes a the growth to supply it’s I really a case, of return strength too again, in would we in September to may expect call early

So that’s this at all I’ll say point.

Vivek Arya

of And it XXX think, or your your right, the quarters? that balance my to, what’s is the up I on follow-up a over implies supply about happening just impact – if next everywhere, is to think and clarification gross And model inventory, should on how its utilization direction days I the over sheet we so. that chain tight imagine what for but the inventory margins with inventory? that, is several

Mark Murphy

right Vivek. It’s XXX on. days. Sure, And you’re about

So as of at inventory. you point over out, quarter we ended the $XXX million

number in supply/demand are and also now the and mass working it’s But and some other as We those. understand there. We alignment and demand share as our it. was the and high, IDP through than first is of up. why years we’re it’s line there past the range the such said factors it’s shifts and I think management, so, when I experience increases China higher risk focus certainly seeing in bringing sight given it heads over and flow but we say forecasted in within of cash we higher flagship thing capital for it’s or Having reasons, it in have to had. that than a tier that including elevated gains would want flagship it’s clear with be volumes X.X of run and And sustained down. historically, returns on It’s our content viewed for ramps forecast. line and this we’ve you’re in that, build

that few over more expect through we plan turns move rolls as the normal a have the off quarters, We year. we next and

Operator

you. Thank

We Barclays. Curtis will question take Blayne our from next with

Blayne Curtis

going try expect in you just for about, to I’m Android give bit. market. again June you a a taking number more about you question. little it on down. higher guided Hi, to out. lot my Qualcomm talk could is thanks down I guess just I don’t just Maybe want have June a to talking exposure

that modems giving of you that maybe Obviously, an market? can in some do us some talk should from actual vendors Android about well amount, ramps with. new So maybe there is without new just terms you

may that others growing the to I be not indicating. clearly are kind story March. same you You’re helpful? pieces in if try through kind walk moving iOS – be that the of It would for June, just of us could

Bob Bruggeworth

it? do I Eric, to to have Because mean parts business two plan. you take we want our

have our We and mobile. our IDP business

I talk a side. we about mobile let the So Eric will think bit little

Eric Creviston

Yes.

story by Android your any exciting means. not high-end especially China a pretty think is alignment exports. out to to obviously, I Blayne, to market. believe point, will right – a and this the come Samsung, you’re start example going the there be see year. us in it’s to And And from we for beginning Google, phones story products now. ecosystem and It’s growing, growing very our for just good

move You’ll think throughout I content, of grow see more as them. devices we to year, will portion out continue content the from a the

mentioned definitely getting us story a since X, And are chip-on-board up the instead for good across Wi-Fi this solutions filtering implementing they of a the it be it’s Android as harder, X, well. and we modules. you getting integrated ecosystem fully XE and had will really Wi-Fi front-end that opened has earlier for is with So year. us harder,

broad across front-end And complex good traction for very very now. a that’s with us. Wi-Fi So modules Android we’re seeing trend

for we is a of be growth that in in all good So think year going content us to to Android. what goes

Blayne Curtis

did follow-up, to my for guess the you’re forecasting I IDP March. in growth about I ask Okay. want

think the IDP part flat kind been has I of connectivity of to down.

has double-digit IDP supply been for issue. a know about I Can talk you growth drivers for that for big So March? the sequential

Philip Chesley

most are our end markets. seeing strong Yes, of demand really in is this Blayne, Philip. we so

you If into U.S. what you infrastructure is into Europe. the look the business, of deployments moving the at cellular side and really see the

those in positioned are We strongly segments.

our defense continue again, business, see seeing we business, positioned we’re big defense tailwinds. in When programs aerospace so those we’re some of that and look And you coming at well to on.

And like also the what And continue side on the the on on kind business, side we power, of forward. two management then together. about of see both business looks programmable are United to going And lot of Carbide that excited business. strength power Silicon from of have a but we lumped so side a we but in customers, those system-level silicon We power the and feel product that create of as market technology opportunities for SAM put see side, well. United for also side lot the a solutions we of real a that as advantage both expansion and we we Carbide Silicon our strong the of

like So we where well are now. feel we right we’re positioned we and

Mark Murphy

and add Yes, pick in that as said, exception is we FY business Blayne, earlier. broad-based growth chipset issues is we related that the talked expect of I virtually business The that’s the to But and is IDP up would every line year-over-year. in sequentially some ‘XX. just And Philip to up Wi-Fi. about

Operator

you. Thank

our We Fargo Wells from next Gary take Mobley with will Securities. question

Gary Mobley

for growth primarily the to question. and I inventory back everyone. anticipating go of inventory you double-click Hi, taking of the the next because good some Thanks my days Are to up on question topic. a some ‘XX? us little year you maybe to detail to relationship up a your how fiscal it in And off on inventory. Or in supply that of more roll can you is plan agreements? give long-term wanted

Mark Murphy

March. of to growth supply Sure, one, combination front And agreements. Gary. we’ve and of support about to and flagship It’s the profile had related last year the not talked there in in It’s we’ve success strong a you the see here us. that’s the growth atypical – in the the

factors. down inventory. in in other over that that that And a we’ve we’re the and absolutely about feel We the that. demand support place There all on position, great demand in a China. time, in of are great agreements they side China. working realignment position got alignment, will And we’ve seen demand So is our and

we our got you to, guidance a still target that. will We’ve I’ve we then on next is And off we’re call. we’ve in adhere before given the something gross margin, guidance and the got to XX% earnings more So working plan. that expand good provide

Gary Mobley

Okay.

year As us revenue wanted perhaps side, revenue silicon as annualized of a be on rate carbide the exit we you fiscal is then ask some ‘XX? market? think in you, sense And that my the a know Perhaps run big the as follow-up, opportunities. market necessarily where can I may but about end on of I automotive Qorvo? end to should about an being there ultra-wideband, hasn’t emerging on give for been EWB you we opportunity here primarily for smartphone-centric

Philip Chesley

Philip. is this yes, So

So take yes, so Gary, I’ll that.

tell with energy at you key one in this of feel our that our the that that’s to So Silicon real drives giving driving like that’s go carbon-neutral what a power I revenue sales efficiency semi more to wheelhouse kind really, impressive. funnel at number we business. see That’s is we specific we of right? systems, think on in look And Carbide, United world can we think do. we type in compound numbers we solutions. of that opportunities And terms the don’t coming is as we the towards But as I are factors of there. electrify opportunity have right? out And When that Qorvo, you that, about significant need

that to about we to really business going to opportunities Eric. continue pass the UWB, scale. I’m so On good that over and feel maybe And

Eric Creviston

know changed. years, will that question file. that plus automotive, I no in each key will each and based hasn’t about Decawave, markets of we up car grow the one of EWB be acquisition is There to the next-generation certainly the and did UWB that we key one X in When points key throughout talked files Sure. was Yes.

market. it’s going a So be great to

of units, of terms In year couple automotive sort a hundred million units. of a it’s course, of

the at us, billion billion X we connected even before accessories available in for and When the home you for exciting. So three to anchoring handset anywhere five super one each talking X.X is to about things. from start handsets look

out. this time There standards like to So a a of lot it’s is take new to the going activity roll technology for bodies. some in

Now everybody It’s happening. clearly is on board.

So that’s area. broad a

mentioned which highlights with was for so module one devices industrial around segment, and And and of also these is We broad, – and – sort tags. it’s there IoT UWB BLE combining and a cases different based a use a applications hundreds a targeting a industrial broad tracking also – strategic applications we sorts in our Nordic for is of the of really our the enterprise completely it’s applications. things of around for tracking asset market really other asset very architecture. radio broad like But on and similarly similar enterprise

a in software of in development core in So leverage the technology there is in our both lot the UWD and hardware.

Operator

you. Thank

will our Equity Snyder Charter Research. We question with now ahead. move next on from to go Edward Please

Edward Snyder

large Thanks couple, on is Mark. a a lot. there It’s the last shipments I’ve got a clearly, overshoot to Chinese OEMs year.

you more given you’ve your burn happening one an last that into quarter will quarter’s overshoot. don’t very you know you’ll you so visibility the with guess, in limited. in tier there? quarter calendar given got have as in you June one quasi-discrete are you and And mass do do Samsung then the And then more you just now of in from? gaining all inventory. XX% sellout now shifts, going and for given it on, given versus Chinese, what do this with Samsung’s there of expect I get big had revenue You if in reflected will now into quarter’s Eric, and changes move really modules can the – the we everything start It What get. this inventory take could, phone then rates to they back to And year? a we think which what ADP. a was see your guys China a are I your you’re mass these on, reflecting share I for think is was far, normal March you shipping especially shipments taking Broadcom have already everything of you that in any hands we’ve can But seen do we I will actually is and Qorvo use from, who underneath are belt. design, there hub out inventory then, your tier, break kind a guide what’s when sub-question, Who level so level the take business with

Mark Murphy

looking can we’ve decent. they add and phone may I actually start, it are the got quarter inventories signs positive the I’ll some and at channel. on So We’ve were closely. But color monitoring is in you even think then we’re and been December There and better healthy. think, sell-through very visibility more very than Eric the actually certainly China phone

it’s eye own got matter agreements, about in kind cannot as helpful And some long-term adjusting how through, out. result. we’ve the of I the we that channel as working on also the just play will manufacturing a its way mining are the and certainly components So excited how of managing an got our overstate intended, that’s process. we’re and We’ve these market and a of long-term.

we’re exports and that serving about our optimistic it. So that and growth, position the they on then do

the in work being, quarters decent in will summer. the shape next sometime we couple and this think, of So through I over by

Eric Creviston

products. Samsung, regarding it’s And a broad of family

very, And I out there here the the trend. is that starting excuse touched BAW mass and will towards progresses mentioning, with as expanding which then more – and a out and power As also lot us me, think aspect quite been expanding antenna starting we’ve strong as is Wi-Fi, earlier, you’ll always to chip-on-board see I been the we’ve – towards significant in continue strong kind content. flagship in on flagship and BAW tuning, be year very but management also of content of heavy

one specifically time. the It’s to So a I’m to who been which with – we’re some has not to Samsung finally for fruition. come alignment, thing. but It’s not from, product any speak broad it it’s share works taking portfolio we’re to see going going in

Edward Snyder

You think XX% this you’ll year, break calendar Samsung with year?

Mark Murphy

we two customers that’s Yes, the I’d quarter, had say. but XX% in all

Operator

you. Thank

to We Srivastava now our from question Ambrish with BMO. next will move on

Ambrish Srivastava

statement Mark, flow Hi. the and to to balance wanted come I cash again. back sheet

free cash percent flow you flow sales, us flows had a cash sales had almost model digit as to my XXXX when surprised I Your double free to single-digit delivering go number. actually of to for a back you

up supply bit So, quite that payables I inventory the you went the cash X%-odd or to digit have parts related free get before. in kind that all securing down the Is to well talked wanted of as sales posting shooting been about advance? versus for quarter moving a to just obligations sure being make double and you the for increase that understood flow quarters. I the after I then several

Mark Murphy

the December have long-term we I signed it, to quarter, you as which last – we had payment It’s made this talked considerable quarter. No, a which make, Ambrish. in agreement, about got

noted, you the well. and there have I was as pointed disclosed then out so number mentioned a in which as quarter, then last and Q December I out, increase quarter, was in filing payables, we up. were an our in And as inventories that that paid the And

So, excluding flow these normal two our have have effects, of And what of those. we generation. about talked is the strong very cash both we nature free

near would up end year expect flow next this And so still it year would expect cash to I and grow. $XXX then million to I free

Ambrish Srivastava

Okay. And Mark. it. I had follow-up a quick on inventory, Got

there sure make about talking My just not the When fan. you I what to you talking understand I aware are we realignment, are want So, of understood. make about. been I has in that. sure to is I are am head trying

You market everybody change share. was trying are a and share talking of what well, market then Huawei at customer big else grab that lot about a to was from shipments,

that’s So, one been shift.

end. some that the high a Is coming a there in is sort a there The risk you on is And of other or else? write-down are kind of something low has of referring bifurcation versus inventory side? what also like been end to,

Mark Murphy

written No. there we quarter. in a the off if stuff would have were And risk,

this, We can on chain. and back it Our Eric supply a bring I the will dislocation in in call. last and to our had components created expand pockets of view, substantial supply

itself you plays has macro out and and think months, the China amongst would that. And has few and to here third consumer are And a pick been demand matter some one demand there past we probably out, with factor have what lock fine. so factor shake a in shift scenario realignment it’s down. associated And concurrently, It been ongoing. say factor. end both then we have effect over you a I up some will no and that’s where OEMs share

though factor is that end as probably phone actually are with lean. is there pretty we concerned So, demand not that because

a Ambrish, will think I just out. it’s case of this So, settle

in agreements got have We place.

got have We firm orders.

the line on we a in will be believe several in inventory sight of have months. and down We working good spot

Ambrish Srivastava

Got it. Perfect. Thanks for clarification. all the

Operator

Thank you.

Christopher We will take with question Rolland our from Susquehanna. next

Christopher Rolland

the Thanks Hi guys. question. for

call, opening you last Farmers guys again. think I up were maybe that Branch you mentioned

that’s there the where that move we confirm year? to ramping and utilizations was through happening might go that as wanted Just

Mark Murphy

we loadings that course, or have need whether Chris. Farmers planning inventories question, still in the case good has looking factories. to of got we yes, we some are some been we in a obviously ‘XX. and in investment there as It’s the reduction are that continuously And Branch, on are rightsizing turn But utilize of fiscal not. And to and because we

Christopher Rolland

you an coming, parts Great. I much you ultra past into BAW the I quarters? or competition in of seen would too ‘XX? more working there. far, preparing there you expect maybe Qualcomm, guys And have but your has are over few product secondly, a know market seen more think for And little so you really bit Thanks. haven’t

Eric Creviston

seen frankly, we lot, Well, this at a point. haven’t

so and I on can’t comment so forth. And competitiveness

are I about think integrating as talked already a pushing many can it filter. complexity and to then have lot working not X it’s our the we you be hard times, is the a there just can of the in them technologies same combine in and And going sampling we frequency down, band soon. multiple together get about shipping lot in multiplexing to advance will which fitter about and module head you technology gigahertz modules, of on. how with It’s well combining continuing what

and the there it’s communications but of – key – very part So a is a valuable market.

So, to trying there is build investing lot capability. to of going the be people it a in and

Operator

Thank you.

our Raji from Needham take Company. & with next will Gill question We

Raji Gill

be my Thank a The challenging questions. environment. I appreciate it. in continue resilient you gross to taking margins for

products? also, premium think throughout you upstream pricing as mentioned to the utilization demand from respect situation how quarter, you of that a kind last more supply migrate the of were dynamic about you with you as think bit a update benefiting to I factory better to products, better margins little And maintaining year? about your pricing network. Wondering your and move power

Mark Murphy

I Raji. start. Yes, will

for the We have going so XX% customer, product talking mix, several We mix, over gross and we got, to this is loadings, believe to level and margin are business this our have move the quarters. around And based XX% been factory about setup GM, quarter-to-quarter, support But price course, other yields, productivity level. of working on that factors. forth, we efforts current definitely business footprint, time. do that products of improve

investing are some today, in valued where have favorable can going I is are all we same of have that we the been UWB, and do to doing, and think discipline are new leadership, managing talked about the gross that actively producing where we they add most. maintain power, technology to I things I profiles. we products same margin of we applying defense, try the say have the would in areas portfolio all

sure the from looking of us important the way. about ways in That’s we expand hopefully to sustain this always are And supporting driving allow are business is And especially We the that are question inflation. there capital-efficient – for in most last Branch, to then Farmers we here. make and we productivity. pockets where period should

Raji Gill

throughout build-outs kind China. for technology. follow-up, what which terms you in stations year I of China expect in dominance with the if And very And could successful the specifically, GaN elaborate you you Great. penetration you of to of begin my to infrastructure XG had seeing your were and outside wonder reaccelerate of mentioned in you your GaN region. are further base that

out that your you kind share of to China, and business IDP outside when your affecting of are market a thinking sense want is of in how I kind get GaN? So, build position about the

Philip Chesley

that is Phil. take This question. I will

of what we in a in calendar But And we critical are small we America. family market creating energy is that look those real kind markets. what year, and calendar China at year. amount tremendous year see deployments is a and of was that, our we see signal product our kind or of to – with kind is and where that the when spent it So, growth to the really families technology this of this overall in time of for of being see products and most we same Europe piece last have. optimized technologies really, We a similar GaN

you now, that in that. we of things right we are look where to and And about so we at if like how were are And positioned. we kind excited are backlog business,

Raji. question, hopefully, So your answers that

Operator

you. Thank

We will Malik take Citi. question Atif our from next with

Atif Malik

similar or were my And when is quarter the in last or year, And impact. hate But because for quarter you is December what March demand realignment you year? the no are the taking impact as questions. last the seeing you you I to thinking demand for supply beat well commentary. my China question you guide, you out Thank demand line Mark, supply quarter with impact March guided the broke as on

Mark Murphy

we than was there is equally that both more are will there supply was balance demand is then. broke as both, expected. quarter issue factors It a in out March is predominantly say call, reflected factors – playing a the probably last We earnings are I there it’s distributed Yes. out still. still, is but supply And and still with it could. – have it the specificity also we than, we that our And certainly now we guidance.

Atif Malik

improve Great. supply, as front competitors’ are And bundle of supply then that rest ability supply to to on RF you processor question eases? year, another if lower to through the the the expecting does ends your

Eric Creviston

a customers’ of things theme to a it. there direct buying we course, is are broad sure and bundling go is correlation market necessarily it’s certain into but main selling that when this times a think to basebands. lot of different are there are not many behavior. the necessarily. mean I I of am there And a mean across I don’t factors, I

bigger a it’s yes, than so And think. I that, picture

Operator

will I from And Charter Equity you. Research. Snyder take follow-up with Edward Thank a

Edward Snyder

all. anybody your other to Again, business much. used around of dropped going build on silicon of here. the will is are powers acquired to you United, I understand U.S. face their I way at question basis else. had what your is guys are wayside, but – the now. based business a very on be by competitor bit point. again, the defense. is doing about fab, I silicon huge the Wolf’s with the know I which really XX% manufacturer are new to biggest largest carbide lower a Thank They kind you you say I what the based earth strategy But supplier a New power am articulate make could than in power carbide That’s them and what get you at a on U.S. suppliers, maybe confused York on IDP. this I device cost by turn you have the silicon

going paying you wafers you wise buying have to to are they So, that folks much are cost this market as twice more the a pay than from them on and problem addressing are a going and are they with. of are maybe even likely, STMicroelectronics scale a one and as

you selling because an on to the into markets are who scale away from of want at purchasing producing devices under-scale going player you are them? you with. that the to materials it be niche understand this the that is can’t a compete diversify power guys game all that are So, sick marketing I don’t from

for do long-term? Qorvo? you Thanks. the model in maybe So, fit does with think can How going do to your in you articulate is what it this

Mark Murphy

there. there Well, is lot a

Bob Bruggeworth

You go should just home.

Edward Snyder

and Pick you what in answer that. chose. to pick want can You

Bob Bruggeworth

know don’t In I of I five minutes, all if to could get that.

Edward Snyder

follow-up. And then a I have

Bob Bruggeworth

think okay, what the I that is our important. charging technical a see is have wins drive there announcements specific So, efficiency think leadership of a about onboard we look business, one, Ed I in like look you when about and business at areas why the we that’s is we look, carbide the And and position can release, in from see the that we quite traction. I it think I in automotive at efficiency, technology bit silicon you having that a that mean in DC-to-DC. capability and capability it perspective,

the it piece revenue at technology that can. per wafers is I about twice wafer carbide that we look than have, to the competition generate think you other we our when the can – silicon

area, the have So, And model when you a we as more look feel that specifically more right time. now. foundry coming supply, more – use silicon a because investment and that to is competitive we we and over to we opposed what that will think see see space, more like in-house an entrants that of we ability into advantage, which of more in the model we and more at carbide substrate make

see, we some those are mean economic in I that silicon carbide okay. of I wheelhouse. our So, again, dynamics would say the is also that,

compound company, a are semiconductor right. We

lot a those We relationships. of have

areas, assume for are other still So, about at may and I I think of there you the talking IT there you opportunity calling it’s you I niche talk automotive, real a hear infrastructure, market. a at large is even us. look you, just what your large you the understand little opportunity. let’s view, look very, bit would a And And but outside It’s very, market, we market. very be a maybe very

for analog I do. it. about can have for have meaningful an is doing one guess that when a of giving feel put capability, combine which And at we the the management, shot And core I for can we and I I I excited been think it build us maybe something into to I And like with Qorvo. And and credit systems, sweet. can in power module than this build executive is be been I feel franchise opportunity a and our where We am years short that’s so But it a better And like are XX now. franchise. plus. us really right we at power at I last that you then I business programmable think the have here we have there, what there meaningful do. thing, you

Edward Snyder

Thanks. Great.

Operator

over Thank you. I would additional or management today’s like remarks. And the that back to question-and-answer turn any closing conference session. for does to conclude

Bob Bruggeworth

upcoming speaking investor night. with Thank everyone again. a We at We great forward want you you. us thank conferences. Thanks today. have for to Hope again to you look joining

Operator

participation. you that And does you. Thank for conclude your today’s conference. all Thank

Qorvo (QRVO) 3 Feb 222022 Q3 Earnings call transcript