Xilinx (XLNX) 24 Jan 192019 Q3 Earnings call transcript

Company Profile

Participants

Matt Poirier	IR
Victor Peng	CEO
Lorenzo Flores	CFO
Vivek Arya	Bank of America
Vinay	Morgan Stanley
C.J. Muse	Evercore
Ambrish Srivastava	BMO Capital Markets
Blayne Curtis	Barclays
Charles Kazarian	Credit Suisse
John Vinh	KeyBanc Capital
Tristan Gerra	Baird
William Stein	SunTrust
Toshiya Hari	Goldman Sachs
Wayne Loeb	Citi
Chris Rolland	Susquehanna
Srini Pajjuri	Macquarie Securities
Vijay Rakesh	Mizuho

Call transcript

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Operator

Good afternoon. My name is Louise, and I will be your conference operator. I would like to welcome everyone to the Xilinx Third Quarter Fiscal Year 2019 Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. now turn would to call I Poirier. Matt Instructions] like the to over [Operator Mr. you, Thank may you conference. Poirier, your begin

Matt Poirier

Thank you, Louise, are Victor and good afternoon, CEO; Lorenzo everyone. and Flores, CFO. Peng, With me

of a and business provide for quarter. March the quarter will We outlook business review and the financial the December

results statements Let me company. future the such conference currently information you our you from cause financial of the during results to that wish company XX-Ks, on call make to may our the contained that materially. statements. risk contain may including or we remind X-Ks. actual future the files predictions actual in and other important or events everyone We differ that could documents caution and projections available These We forward-looking to our based the today, are those projections statements that regarding materially XX-Qs performance SEC, differ or is and refer with forward-looking that the identify documents factors

the it website. accessed our been call live. and This being In financial measures, company's helpful to be measures financial non-GAAP measures comparability is be will addition measures conference posted to facilitate to investors supplemental open results. measure business. period-to-period used GAAP core management company's from the ongoing the to Relations evaluate reconciliation for GAAP included analysts provide disclosing financial And these by all on certain We we of continuing amortization related A evaluating of Relations believe release to will the non-GAAP in unusual non-recurring is analyzing one-time website. effects and operations for as information by closest Investor be items, has to We in such purposes these of and our is certain of non-GAAP financial excluding and webcast Xilinx sharing and that intangibles business earnings Investor our items can acquisitions.

now over turn to call me Let the Victor.

Victor Peng

non-GAAP has continued that to QX. business XX% in results in to and and FY strategy in markets up non-GAAP Revenue to growth Wireless on our XX% operating up I'm primary deliver each had $X.XX substantial year-on-year, very our Defense, over by year-on-year XXXX, up markets. of share. Communications, executing per afternoon, $XXX EPS our everyone. strength Thanks, in We in excited Test end income and with excellent XX% was good report Matt, and strength broad led Aerospace driving Measurement year-on-year, the Emulation over million, and

a fiscal his surpass We to record in the revenue that with QX remarks. expect of XXXX guidance cover billion for Lorenzo will $X

highlights. early some both and as driven pre-XG of by deployments XG start revenue are in Now expected was Defense from multiple revenue as XG as the test early Korea was Measurement across me also well also emulation Wireless Aerospace defense sharply strength LTE driven ramp strong share quarter, very broad across growth by the was Test we and market of The upgrades. prototyping the third strong XG was as primarily production QX Communication the subsegments. the and third deployments in driven the very growth quarter, deployments, South and as and we some let by a very in the seeing where well stage Emulation China. strong and increased programs. and in measurement,

that look and the core grew by Center a you within year-on-year not nearly doubled. quarter -- I Data is If our mean digits at what and on double revenue core basis double-digit cryptocurrency, including

was was cryptocurrency offset However, so off, some that from there perspective.

well as and wins across transcoding, analytics big the strong learning had compute, hyperscalers, as very and continue to machine data build storage including segments. we with and ecosystem products video of we We our expanding in said, momentum are controllers. networking inference, where a design broad that our acceleration, storage for a Now network adoption applications acceleration, applications

previously We for deployments have additional as a beyond applications have hyperscalers service in with our FPGA multiple with Amazon, the engagements area, we now the won and announced Huawei. designs SmartNIC and Alibaba

We performance this October Alveo Ultrascale forum. high added as previously as developers UXXX. board UXXX our large FPGA applications for capacity as Virtex well launched had data product for past our that ultimate Plus We memory. These the in UXXX such a data specs recently with the also XD just big at together are UXXX bandwidth we Alveo analytics, expanded the has announced memory and of high mining. the acceleration family

by multiple With add-on ago revenues year a grow our EMC In from grew automotive, and there grew Xx platform an sales applications are of also and communications, MPSoC broad Dell over to MPSoC markets. and Alveo and our grow. products led SoC XX-nanometer servers. card company, their very robustly. transformation year-on-year certified momentum there as that for versions a PowerEdge the strength SoC approximately to saw as XX% quarter. well across has design to a products XX-nanometer end industrial our win now was of XX-nanometer set accelerator Zynq we respect is very UXXX continue Zynq And as addition, Zynq selling the ADAS, continues particularly to

than unique are had just quarter. in last is the with engaged triple XXX now multiple the number end We markets, in over customers more which we

and the drive in revenues, activity These of wins are applications. autonomous and of more these of growth me, MPSoC mid- revenue driving excuse to long-term. We automotive forms in wins seeing other design also our increased will

power really unit just that CES, automotive advanced first for technology our AI of running ZF at autonomous CES the I'm And Daimler report again unveiled is running out product, ZF's our first a cooperation strategic where also us recognitions announced in has Interior and model at MBUX So vehicles. this powered just a recently as number neural that with of taped industry’s finally, we we Assistant based GLE by X-nanometer networks. to one control the image very Versal ACAP will our Mercedes-Benz their multiple planned. MPSoCs pleased is

and may more well very that programmable both are you product adaptable, Acceleration Platform. and As than is for Compute FPGAs. Adaptive powerful are are software new platforms compute heterogeneous they ACAPs far as are recall, stands ACAP scalable, hardware, category a that as

be will we fiscal year. second programs, exceptional the their products X-nanometer calendar been quarter of on results, we fourth extremely I'm a well sampling as as team customers execution Versal proud So both as the half the head engineering business for of this our to of year. what's the in into major truly on our

over thank So now. it to me let and Lorenzo you turn

Lorenzo Flores

Thank Victor. Yeah. you,

expense we As and decline Industrial weaker offsetting in expected. and GAAP $XXX We flat. growing exceeded and an operating very grew line strength X% OpEx Victor margin in due was Channel higher income revenue both year-over-year. was at significantly, slightly million was sequentially business Communications expectations, gross million operating the of $XX to guidance as XX.X% guidance. quarter, in focus expected first Gross pleased and expected, said, XX% increased, margin X% in income our a expense non-GAAP outstanding businesses, our Operating A&D $XXX a grew attaining growth All also D Industrial increased while driven end Center milestone with for is operating more showed primary the at or which non-GAAP excluding expected GAAP our the decline million growth growth was in line strengthened was than XX% Broadcast, are markets Broadcast our and was the with and the $XXX decline our This income time. with quarter. and easily increased as with revenue approximately sequentially performance in significant by an in or our $XXX four Advanced and expected TME delivering was Products, expected. grew, that higher with than million this in Consumer, Victor and was wired. significant and than million Data as execution in and cryptocurrency. offset achieved million than guidance. with was $XXX operating wireless expectations. Automotive, results. XX.X%. XX% And in Xilinx in Consumer line Auto line year-over-year. said, of are again revenue A&

instrument Our non-GAAP the share set is earnings per to particularly key diluted the points fiscal $X.X The that million the tax income to which million, billion diluted of Gross sheet QX, receivable on support was in Note cash coming rate XX%. net $XXX $X.X net record from we a XXX GAAP Inventory increased The days. built and again non-GAAP Accounts and net and Earnings our reform. cash to increased yielded Share X% of flow. In $XXX in in non-GAAP guidance Wireless Non-GAAP in shares. at $XXX as was sum, quarter for per debt $X.XX. income Communication. yielded to operating $X.XX. was cash of earnings rate share debt. count million GAAP company. million primary $XXX difference XX million, for with just related demand, we up which between $XXX million $XXX declined and due. inventory million, over to billion was have million is $XX GAAP to the tax future flow. rate generated we and was the balance slightly

repurchased shareholders, shares $X price to year $XX.XX. this to returned for at We of total million, average X.X by quarter, almost bringing $XX an our we million dividend. million quarter, This $XXX worth entirely million the of shares

Analyst Day. discussed our apply to as continue We capital our allocation strategy at

XXXX. for to on the Now quarter year of fiscal guidance final

in continued sales and to A&D are Communications decline. December primary growth particular forecasting with a million we in $XXX very and Center growth to revenue be TME, will expect strong be are end With TME. $XXX We Industrial Data markets, million. to After regards quarter, between expecting strength we and and Wireless and

a million. be Broadcast expecting between to Automotive, million Consumer. and $X expected and Channel also are $XX We across revenues decline

Our is other given operating to and million. expected inventory levels. by is driven $X distributor $XXX to grow expense employee of Non-GAAP revenue levels taken GAAP to expected inventory, million. margin $XXX close management be wafer approximately expense us GAAP increased and expected will expense mask is be million, have approximately to Gross compensation. income to XX.X%. be processes operating target

and is share rate count X% tax slightly and be to between Our expected X%, expect to increase. we

up of double-digit end I our last first financial view I to up three this the Revenue quarters the four growth. longer as to the of is show close, demonstrates performance are fiscal Products clearly markets highlight compared XX% approximately All XX%. for strength As reported our our Advanced want year. consistent business. of year-to-date

delivering profitability. and to allowed Our than EPS greater income have Operating income are EPS up doubled are in has dollars income and net GAAP business up invest XX%. to and revenue our than growth net continue XX%. us non-GAAP while outstanding more

quarters flow Finally, increase first $XXX operating XX% three of of the fiscal exceeded over XXXX. an million, nearly cash year

operator back now the turn call for to the Let Q&A. me

Operator

question with Our Bank Arya of America. comes Instructions] Vivek line [Operator first from of the

Your line open. is now

Vivek Arya

the strong good to outperforming. and semiconductor on congratulations Thanks company for and growth execution. taking least one my question see at It's

of Victor, what I'm to as and you deployments XG? these you XG are contrast deployments, these content And with you is So, the in how curious, it right, would of starting which some are silicon, get into address could seeing part range investor Thank from ASICs how days? we and saw the be when competition as XG merchant XG do there that, in you. concern or you about back

Victor Peng

think all in and virtually in talked calls, baseband. the in even I earlier So we've about only proof-of-concepts the are we demonstrations, radio in but not pre-XG the how

in we China. which also have very, very beginnings Korea we've that deployments in the the been as baseband. started radio, So really traditionally in content in both of always and true in seeing North do strong and We early

yes. So say, I would

I the right to analog, SoCs, generations. that larger deployment integrated for XG overall, -- to would calls, innovative yes, with as quite XG is right, really our say, RFSoCs. I've is -- a high be analog a also previous well point in that a out we're said our also previous going the content Korea -- to have past I be South performance And bit, compared the we've going would this we now. higher as

capability, think have I because our in persistence will So more of do we past. the

component, out side at good with than baseband However, follow-on of are that not necessarily would ever, radio hang very generations. also a even even the deployment, there'll that I to X-nanometer good the with this in first and baseband will we strong say side Versal in generation have again, on it's come shot clear And we're ASICs product, baseband. particularly I longevity we come on but on board. third having be second and and on yes, our the think, stronger will when

Vivek Arya

Thank you.

Operator

next Stanley. from Joseph comes Moore Our question with Morgan

is now open. Your line

Vinay

have how Growth strong MPSoC, applications you're Hi. much expansion strong. in we just much right? to do of This your And Joe. Vinay visibility of should Congrats you years share there is how to next a about the think like and that Zynq wanted follow-up calling couple like over TAM how that versus growth for comments that business on on due there? quarter. very new very for gains Like remains on I is seeing?

Victor Peng

Yeah.

we've I the and or first we innovative architecture certainly, of what we've more. cover of execution and But ASSPs past again, more But is nontraditional to applications that both those the both strength I the are winning those our think in had would cases other with it's let's we there in and the real cases we're I are, of by competition winning other. displaced attributed and many competitors. a lot one mean, used in add and have two. traditional

So there's expansion. definitely TAM

solutions and see more happening. in standard data end the first incompatible architecture. kind custom strategies more platforms markets, and third really and whole element kind they think believe for that second absolutely can't general People of is world towards platforms. right? intelligent of The and have The I Zynq connected digital is is so are we of have move strategies, just kind moving ideal multiple cuts towards So everybody across this standardized we generation

Vinay

like Traditionally very I about little backlog you visibility platforms wanted going like you're there's real business. and and new follow-up there, but share and That's on that Aerospace how growth it. to your helpful. on the your is Got for seeing business been forward? can anything Defense lumpy, a

Victor Peng

to maybe, make I'll in the speak Lorenzo, Yeah. backlog. and comment can fact a

I generally. Aerospace for on basis. overall annual talk record track Defense our me and yes, on just definitely mean, is Let a

than programs, will birth digesting by on versus they times we're I segment. past that little driven we the seen sense in see obviously, quarter-to-quarter. that a buying -- when will cadence rapid a basis forth. relative we're of You from of of trend those have seeing perspective, doing we've and from that bit cyclical so more in a technologies are programs the It's these a say are the adoption more and encouraged those more advanced lot in

let it's Now then backlog to win, are long from that the bit still on seeing production I'll a Lorenzo answer to change nonetheless, design a comment. of fairly cycle and we

Lorenzo Flores

we Yeah. No. by I guess, disclosure. backlog for breakout I that would say, end simply don't market

Our you A&D for if business out come quarter is in based the we backlog business pointed quite But out, your on that in again is in expansion of look or designs year-on-year actually strong. market as the trend A&D in, But the with general as overall you the significant this as types growth pointed won Victor question, we're of is past. designs to well as in the the lumpy.

some So things I strength. longer term broad the both up with trend set think

Vinay

it. Got Very Congrats helpful. again.

Operator

line comes of C.J. Muse Evercore. Our from with next question

Your line open. now is

C.J. Muse

first things. to how I particularly taking at the Yeah. comp Good doing if my guess, question about, gross throw higher, Thanks. forward? side, are I And side afternoon. trajectory And the second all, if guess, in drive as for should tax about question. here. on move what of question is into about thinking could you're fiscal margin we you think How I you talk margins particularly the products? just Thank there, you with we the on Can rate XXXX? next-generation

Victor Peng

try Lorenzo definitely I'll the cover all. We'll second. and will cover Yeah. to Okay. the cover it first

gross the product as mean, big production we of see actual other not side. does of classic to of So, in providing But And we are and for value we're weight. kinds example because things just we capability that customers are that end saving a one gross provide and our on do the drive saving the a margin? to right. growth are what the innovating, bring general things more do Because somewhat. cost other perfect in value fact, more cost, now and margin component the to wireless, profiting, that thing deal innovate think of do a that right? We're the is we our a the do there when on a you're level, like and the what with Well, all have biggest do yeah, of say terms in that. down great so of margin, margin we sense is that. terms in the mixes up at terms I XG ranges case of but driving and the I our because number hold RFSoC in in we I would system issues, that, starting both product we gross mean, disciplined a the few deployments actually of that business just from and win-win, I more, this truly we of no RFSoCs in power, we has

the is go, all on tapping needle basis. with I innovation on mover Zynq And is big not think again we we the do when I continuing walking silver always whom we the we time. bullet innovate, So big and -- ongoing integrated there things with all is, that over the think, these actually movers and there's first the one needle an roadmap starting But that SoC right?

Lorenzo Flores

So, the margin think, quite I Victor, comprehensively. covered piece gross

were quarter-to-quarter have have get I'll that FY are But over specific yet, FY come in given tax will to there caveat, take provided to I on to for haven't long-term incorporate more Hope at as get expect regulations to I into XXXX we for. you we that I C.J. we reform rate tax rate. have in look guidance range. for the tax would back that the The XX% the we XXXX tax tax the But But XX% are solidified, has on providing quarterly the expectations helps. specific general from haven't thinking rate. different pieces guidance if to just lumpiness again we'd normalized FY the rate. that say XXXX, the the be we So

Operator

from next Srivastava Our comes with question Capital Markets. Ambrish BMO

now is Your line open.

Ambrish Srivastava

I on risk a about are of concerns thinking could China, Victor, question and very you Hi. had change mitigation. But Thank you all how the much. in a course, tweet.

meaningful pretty a heard have XG well. say that You China from as you I of coming and thought I exposure some was the strength

give talk Alveo, you're growth about us it? is you on half that then your thinking the that was I'm about second you quick follow-up correctly pronouncing perspective traction question help could bit the about just the my how phenomena. understand So a and if little or And talked us it

being below at just you. the and So Thank about to is margins the slightly contributing talk that ramp least?

Victor Peng

Okay. China Yeah. carefully. have situation, we trading to that very The continued monitor

said, it's predict. very you As to difficult

So that's think going since appropriately. certain certainly just to we just don't occur, and it might then about appropriate to should really be we respond react, scenarios action what actions unpredictable rashly, and watch really but we're reasonable want take

we are different in we So into thought the But I the know us, have scenarios. place we But, business. that think things stay the we in do different the that now right will put the two do facts, to tariffs they continue way where if thought impact scenarios. clearly, for are,

and we more and only will October and meaningful in modest very it should revenue the So be did more it said that, did year already leave Alveo speculative to production correctly. that pronounced is and quite what fiscal again around this To once because started only it's in at November. the become I shipping since you actually it we in fiscal just launched probably and second half, question next it going happen. could We've year

a gate, into We're it the very at as partners. of was say, in that out So strong early, more qualification of year really comfortable there there's OEMs, We're I right in with I'd going other Dell, see transitioning next early, the calls we building well that, channels, that infrastructure. very more out we're as fiscal mentioned when activity interest. And where number the now. PoCs. engaged is the -- production. is mentioned but had think, happy it's I the earlier very would I very right I say

now. I'm So a happy It's amount very with right it. small

in we the with margin no, the impacting board, but really don't infrastructure delivered of the terms silicone particularly In we -- margin. the tremendous just doesn't Again, value, software think and piece, the it not that we only it along goes anticipate it.

will a feel like but We value. are delivering of price lot it we we competitively,

that weakening So see we overall let's as will say, the company's exposure, margin. and an

Operator

comes question from Blayne with Our next Curtis Barclays.

Your line now is open.

Blayne Curtis

my taking for Thanks congrats. I'll Yeah. question. the echo

Center knock you just and you you maybe XG TME, TME that's You of Data then, did quarters there. didn't just mentioned of you highlighted out mention so how curious, or there Thanks. much Is is it there, just related? up, lumpiness -- in any a being had kind Data update it? Center mention smaller And in couple

Victor Peng

Yeah.

world end the strength side there product high really side, our On actually to unmatched. is of XG But and testers, some TME good amount there where testers. the related quite prototyping is emulation also strength of is specialty in the

mentioned I and we some whole, strong was of But as and some semiconductor test is XG. pure where a not more think I of see might say, degree on before TME areas. just softening because the other of the

respect that's to that way. still said With we about maybe year-on-year growth about But of it we're what a materially we're numbers quarter-to-quarter But Center, again, basis next Data on it had year. more fiscal it's small quite is and we Again, relatively see modest we So and our today, still happy that double-digit seeing. all basis core from doubled. think the growing relatively nearly it right? we small

anywhere In emerging, But to is. we're is terms are because mean, don't there state seeing I of what think, close yes, I I lumpiness. think of things steady lumpiness, degree a

So reason believe I kind to market. become diversity a of have I will don't think intrinsically, this no intrinsically

Lorenzo Flores

And that have, be results attributed cryptocurrency. aggregate reflected you I more business been the might to lumpiness of might have in the the think some

in the declined that quarter. As we've said,

Victor Peng

that of core can But our that said the just near-term core that relatively don't that Center very strategically business. basis. big is interesting we Lorenzo fluctuations small the we're again consider because a enough about cryptocurrency Data perspective, of percentage. to a talking part And But is those that in that Yeah. put impact is small on

Operator

Pitzer Credit Our Suisse. next with John question from comes

now Your open. line is

Charles Kazarian

Kazarian behalf question me on Pitzer. Hi. of on Charles congrats the John Thanks letting for and ask the strong This results. is

rev previously you could than a than But on, bit the about the longer but in prior ago? elaborate rev XXXX already the XXXX expectations, a out rev have with I was ramp this year-on-year content picture is a ramp lower of out? this and You comps December perhaps just a cycle still growth up close hoping it year-on-year, this has are less how you steep, one, looks played relatively like peak. steeper months then, you given painted And about bit to XX% only XX say, for XG. is Thank we're innings ramp seeing build brought the two, to relative peak levels you. just early X%

Victor Peng

the didn't as clearly, ramp did. Yeah. anticipate starting it early as we

think last said I the that call. on we

not the happening out than of in cases as we're cases all, both pretty in fact in thought. the strong. we the had I this well is the So for And that baseband, some in coming faster both some ramp allude radio. gate start is shipping to of strength as did the

people So could a strength multiple is, unlike if don't one market we That's products, to giving is our beyond you're about some what's we I relative growth. right. I key Center. there to be market. and will will again that as I with believe XXXX a we've that strength. said say those what climb. mean, this markets I is not to is new with this be speaks come going the is just one cycles on still But -- up very still early adversity definitely still our there value still steady tape-out into high earlier that of much. But as get come deployment, out of capability will more you props strengths Once more we've in I in think be the at talked this this the say strong to would about and combination ASICs, XG of look think the just rapidly. all Data

there's but more stronger come. a I anticipated, what we to this yes, So, think is than bit

help? that So

Operator

Our next John Capital. with question Vinh comes from KeyBanc

now Your is line open.

John Vinh

XG, Hi. for these that for question. just also products of into. played right, I the Thanks from wondering and be or seems talking potential gaining kind to TAM look They XG winners you there you wondering losers a components talking some everybody share was on if just my integration analog discrete relative just your we Victor. had analog on you I'm on here? are about of peers just question have follow-up is taking benefited RFSoCs, at expanding your benefiting integrated When about are as could have that? I introduced if you've whether provide perspective historically of on and everybody here. comment, well and you could

Victor Peng

we orders more mode, as thing be I definitely integration expansion. you products, the is that haven't already a only fully to perhaps. same do share, would also that the credible what I packaging more roadmap playing game bigger there's are that is much and advanced of in side, time It's product say are XG think do any in which going of in but of TAM the will an kind going deployment. I real rich expanding People comparable say coming to we But TAM, other over so for X-nanometers. because think, from monolithic terms still follow-on trying be about today so are integration. right? people again, There XX-nanometers, magnitude, will not We definitely not have heard a much the of it's gain as doing, performance is

next in [indiscernible] in the of and to what's way the in radio level what is I it the just they simply is an by and think layers this cloud People different at are the think the be So both I and integration got. of radio, sort re-architecting play. going terms right. and the up And

overall be there and to enable is traditional solutions. also architecture the that more disruption other going in I So challenged think we some are than the things

John Vinh

potential strength pull-ins Got And of the just different some the export you you by of then ban it. question are those, there? there's a OEMs Chinese Chinese follow-up seeing a on ahead components on US do on Obviously, potential perspectives in is that is but components. think my comps kind of risk

Victor Peng

that we're situation. very to So, look, sensitive

So to from that also business various perspective out. we on and things definitely triangulate sort multiple of we filter work

on is don't mean strength strength. pull-ins that, the pure all is in or we across of also seeing going geographies double we're what's So believe China. not all Tier our in would Xs I just bookings. add any I sort wireless just our

So, yes, important an China. China not it's but only region, certainly is

we as an about that's And kind matches, of that business we we cognizant through said, we we're risk. of can but our So best the triangulate learning see Victor demand we're point. important what deployment to think that deployments to try because is map trying as the demand and

yeah, significant don't that all. we degree, if So, see at any

Operator

comes next with Gerra Tristan Our question from Baird.

open. Your line is now

Tristan Gerra

Hi.

Just quick the on prior a question. follow-up

given expected? see what of ahead to climate, to customer to specifically the any So you seem do geopolitical previously timing XG of the on revenue that this impact on for some you which have impact be the see that does China? outside may and see far you of Huawei you is the ramp And that in so

Victor Peng

of complex the again, I not industry. is Well, it's and situation whole what say course, -- it's very guess, a this I'd just us,

try But that I we things with terms am to very I anything careful at a of carefully. situation. are there far seeing the that, the this material Huawei. track that we're the very FIA So do and we say business carefully. all other keep watching board monitor and of on not very in so would are we

repeat expected, Korea say. more the is In want deployment earlier South than the I'd terms on to than what strength that of the ramping I

mean, the it's I'd -- was licenses signed, very China Just to it's the what initial start seems still very be the but is of some on of say early I China some signed spectrum the of just there plan. side. beginning

and we well are real South expressed last -- strength is in quarter deployment. in what this seeing think I we Korea of as So is production terms

Tristan Gerra

type Does targeting then just higher looks this of is on driving the two automotive? And of like Okay. autonomous Zynq opportunities? quick industry-wide. in impact And follow-up an of like four level of in It potential level primary products Zynq ramp in a are more the your ADAS. your out of products push -- having ADAS level opportunities

Victor Peng

we pure driving, been other have ADAS, like both we to of think well these autonomous you've customer monitoring as that well exactly I a a really in -- sure more occupant store experience. lot not just have as features of are nice I'm a as as lot systems how activity

be detection safety-related browsing, just and could things. Others experienced. convenience a and are better Some like

other I'd driver all more of The remarks the these today geared opening display other whether opportunities. So ones those better kinds of or say, ADAS and and heads-up whatever, kinds it's that I we are towards in say autonomous applications revenue driving are my largely are mid-term of did kinds experiences. in is passenger four long-term around and

deploys. don't I So is very dependent when really think levels there super our driving success of autonomous higher autonomous on

Operator

comes from William Our Stein SunTrust. with next question

is line Your now open.

William Stein

Great. for questions. Thanks taking my

you impact First, the crypto. I'm of quantify can hoping

is in Analyst to revenue approximately talk this the Should opportunity at space. sort the it was company talked your engaging and actually let's Day or for we it that's that with this business think I about growth still opportunity of about much you OEMs is are you target of building growth in that -- zero view? you assume being say going a as we're not is sort farms and and anymore mining or

Victor Peng

we we is actually think I opportunity. think there don't that a convey So big

seeing I think time and opportunistic some usage. get conveyed we that at increased we were

basis an again, It's from of and call, we service single-digit. be volatile not on is millions we non-strategic. always and raised the so because like, about clear but low said, on when asked Again, it don't want focus of low look too we revenue we've it. and on customers, will I we everybody tens opportunistic, But quarterly earnings it's basis, think that. those its it to it's long a annual

-- benefit be get do be various they we it not today. crypto. as we've anything down any clearly sometimes is other algorithms bit mean, that us may to are for be changing that they So might it can then What a of us. some But we depressed is quantified when whole, term think solution, I like it's quite an up, are different the and technology longer to when little currency think, but opportunity, goes when is how like changing that's thing as or when relate Blockchain goes maybe too not and never one things -- it a the calculations I they of

that hopefully it. how anyways, clarifies think So, really about we

William Stein

sort range it Helps a we're over little of XX%. in can in. opportunity, your your the bit. I the One and accelerating growth mid growth On other question seeing guide year-over-year if squeeze quarter revenue

a sort Now Do despite five, and cases rate to precipitously in and some out, pretty do negative, a continue and that say, when six relative some mid unique shortfalls more, decline away the in company's even believe because quarter just pretty everyone you crypto great going accelerate you industry? and maybe history revert but history or plan range to and opportunity for problem spots an industrial this you're to growth and two not wireline have not of say the four, let's let's it your doing is you doing is time growth, else think in the relative something quarters. special to or we really this when of normal go or to seeing

Victor Peng

said if stand XX%-plus, but Analyst Look XX-plus the any from departure giving hear growth to to now, is But well that departure do we wait at a an conference Day -- that which heard stands. what that's right. that that this we'll attended we I is still had we a point, And and I've of or history. that not anymore, deliver still percent that at would we so Investor we not right? forth so and Clearly we company from executing in hear XTF Investor already that why FPGA But again a on basis, That we're May, we again said ahead believe you FY'XX update the say we're of next is or the look certainly at the you we our goal if in strategies that and from drive that. guidance again you history. can do sustained Conference. are by a -- beyond We're last

platform company. are a We

are the analog, game delivering performance we -- time. over change high have We Versal ACAP is going to

believe double-digit So are that's and we sustain different why we a growth. we company can

Lorenzo Flores

markets both mean we've addressable mean think I can serve gaining simplest the -- you are we and we just about in terms, Yeah. share. expanded significantly I

as we outlook our -- said, and fundamentally are, different we Victor includes that. So

Operator

Our Sachs. next Goldman Hari question Toshiya comes with from

Your line is now open.

Toshiya Hari

I had a OpEx. question on

over of in past sort revenue the OpEx couple consistent growth are of growing quarters. line been with You've

to big I think guiding as a well. number pretty you're for the March quarter

the forward talked XXXX, the As growth? about about into I fiscal past year growth how think, big we relative you've in we should to revenue OpEx rate the of to company Victor, think, you've little or disciplined look selective talked be opportunities with more At a need I therefore facing time, little same OpEx. think the aggressive. you more bit being about a

comment So can that if helpful? of on sort be you would that

Victor Peng

Yeah. do little my able I yes, response a the We suppose change be repeat sentence want one that, sustain and just no mean there's it, powerful This opportunity this we I just have perspective. in think to a in boring $XX take to be you investment. growth. will long incredibly strategic product, product. that our complex out is thing X-nanometer arc take an and in of But significant. very transistors, tape level We on right? does is and it We billion

subfamily. when you first it XTF we announced launched six the that's product As we at imagine -- we can have

because in some So we to and follow-on. to XX, continue done additional of are completely X-nanometers. the interest gotten not strength some in We're XX going we've invest of

to earnings can of as invest, well continue growth we going to as growth drive and are we keep are we this expansion, So balance this up. going kind to so

Lorenzo Flores

Right.

our we at step the what annual for guide. in up an was quarter-to-quarter So, had provided with -- exactly line

within already just discussed parameters on articulated. based that So the we've the all it's strategies Victor

the to revenue how haven't drive give But in in so previous the to guidance. if -- on refer I the we FY'XX consistent And you question we're going growth it's future. consistent, think we're strategy -- call not this and going remains and back to

Toshiya Hari

Got I then And it. you. M&A. have on a quick follow-up Thank

Your Without sort a the targets? when if conditions can you. would be for or company of months. That of filtering what characteristics names have business quite often news over helpful. you past specifics, remind potential in talking will Thank or look the through you what couple been in obviously us

Victor Peng

aligned have mean, a is acquisition did, which look strategic strongly goals Yeah. DeePhi at position we Obviously, cloud strong the we if about I that, that so you our all and the to platform. capability. endpoint of the talk intelligence to particular machine can from across They very DeePhi learning in in with we right? is kinds had applications we to strong be to deployed going artificial those. all is were and of and edge designing our very feel

of because strategic the an So tuck-ins best at towards I kind prepared that of think we'll the would goals. probably think And for things it's be to nice we a as have that guess, be if that. we strong, and leave the these rationale We strategically to continue be just are certainly like it point some very to that aligned. well. our It doing just on. seem kind wouldn't deal going being is unrelated was obviously do we adjacency achieving there's way that tuck-in. And But about constructiveness to bolt-on more there business

Lorenzo Flores

disciplined in on mean, talked clear then the I very very Victor filter about. long-term. there's -- And providing eye financial strategic a that I that's return think,

Operator

Our Danely with next question Chris from comes Citi.

Your line is now open.

Wayne Loeb

Can Wayne sales big Loeb ask is question. what revenue growth percentage for my is Danely. year-on-year right and from China is of your I taking Chris are Huawei ZTE for in This coming Thank the specifically from how Hello. you China? and what now? Also

Victor Peng

I'll reverse order. with So, of the kind this in deal

customers. We revenue don't are not any XX% customer-specific We any disclosing information. have

the it's So along that. quarter it, revenue. think is Last would I it's overall our million, of slightly with trending business. see we'll our year revenue that, keep a $XXX it which K at year-to-date in China was above that you'd but our about

Wayne Loeb

are lead times follow-up, Thanks. revenue growth? Okay. given as all And seeing any you extension a in the

Victor Peng

I sorry, about ours -- but were some about a there's talking time. talking you're our components right, I'm I thought you're am we've, lead There need for while challenges and sorry, where some components, yeah. you

evaluations -- good, customer of been time. what good lead think we've really I in our getting terms

really it's pushing effort components not again, now, But that. I general the in been of a in that's in out do critical so, lead And strong, are few no we an but wouldn't delivered, not times. XG to of sort very terms we've say since that

Lorenzo Flores

We on times. some of newer our have we extended have -- products, lead

deliver to So our carefully with their we work needs. to very customers

So its not point systematic. issues

Victor Peng

of general I peers, in doing delivery still and And very we lead in compared are think times. well we are Yeah. terms to

Operator

next Rolland from Chris Our comes question Susquehanna. with

Your line open. is now

Chris Rolland

guys. first? you've talked XX-nanometer pushing talk far know lot And you and I Victor, about to on here. of your architecture node a can Intel density little This big you a between Hey, super the perhaps about the Congrats discussions a Altera. been battle getting I quarter. used us too about there's But on view for be here. know to

to were six-month your first, in your for is you the business If general lead mean get opinion? what there

Victor Peng

that. certain since we I more is will pure whole it of it in are would markets, lot beyond and we does FPGAs, important. have architecture becoming think because why moved capacity isn't talking for correlation when a programs It logic and still say, I than offer that's more But do. I just value we FPGAs how to more sales people matter a pure certainly, Yeah. mean, had about stronger

providing, software we I think that, the as company it should the are say more this very saying levels that Additionally, now IP we're platform tools, the that Ergo that's higher a also would and value of and adding of barriers. has of therefore now stack but been all silicon-focused,

pure even higher we're a of we're So are also because actually from and PSG silicon, barrier whole the very we well they or is in the are Intel still software not innovating actually the terms continuing to integrating innovating like -- than the it execute is relative that, but stack. to architecture technologies

we of watch course. them, to we So said having respect that, continue Intel,

I for up. in been front not are what arrogant about really we and leading from good a the going to shape I doing never feel or have You we think to But get way are form. want so let mean we we while, any

Chris Rolland

cede of do the you Victor, your for prime to where then, Center idea you kind evolution? inference in AI expectation Alveo guys of AI with kind pump core? are expect Data market for market to is of step of Is that perhaps, the inflection the core that And core the next the be here kind or to expecting Great. for kind AI

Victor Peng

inference want core the No. It's market are significant we get In well edge the not Versal as that including of to factors like going expand the Data evolutionary. really It the the more on as AI to from market sure the inference but computing, that we endpoints. again may using make automotive. Core be to in revolutionary just is AI Center, we definitely not that see I improvement. will

do lot see a Data right? multi-market, really and automotive. that interest have of going have Center the it's strong quite in We We certainly interest a So in we to is bit. expand

I platform, other core say, this do to selective the se, in stack platform per strongly you're thing not that us I see infrastructure cards a delivering case think, a things, correlates right. the of piece that of cards. right, new Center standard but In as going it Alveo, piece, Center AI Data you to base software types I more but Data the whole wouldn't areas in physical just of future board and think kind this lets just very

Operator

comes of question line Pajjuri with Securities. next Our Srini the from Macquarie

now is line Your open.

Srini Pajjuri

SmartNIC question a on the just Victor, market.

that how a and your that that when start mentioned big there. to you that think in put wins ramps is of you think into as growth? market perspective do revenue I Could you how couple impact design might will and

Victor Peng

is are unlike say, compute would sense with level the say the thing design both the at SmartNIC Again, to that, about always Where of simplistic a network on us it making customers only technical. much be of the criticality of things of SmartNIC super I But abstraction about the I not arc hardware. largest. is of in compute kind probably being that we're in of storage, we've the the compute operate less segment, needing long would knowing engaging in very talked nature the having Yeah. the the said could The the SmartNIC high as as well in right. second three, SmartNIC. is more

also to broad that, not there's either. don't we dependency a we of good a ecosystem on it. of an the we're -- it's since like that -- not element support are ICs to And not news critical swath is things and piece So have not trying

not it's those seeing from nice pushing, also customer attractive. It's just pull very So right. perspective, we're because

those is -- that a important we are very us. see So that for area

I think are it's ASIC. people us, think not doing but I just

the forth. doing clear well so value obviously, so see more that it's So into offload, on architecture Data value like of people bandwidth doing getting other security just as and in for things and the also face other Center, as

strong this to I'm very some market. a view publicly applications. a regions getting -- it's I always design we're but good very, like feeling it can't design reluctant about a we as customers, wins So Unfortunately thing. self kind can't very many are we momentum. win of across inflection I and calling either, of point. end talk That's attractive about encouraged

Srini Pajjuri

follow-up. a as just then, And Great.

mean able seeing are in on be transition Just more. you you baseband. a kind hang preproduction of your that. comments do want I I you won't are you. I able the of elaborate think, early to that designs about see please you be XG I to mean, on understand a wins ASIC on? mean, Thank think can here you the else? to better. little of something want just some said, just I What to baseband, if hang kind or you you in won't an normally by to we understand that comment seeing bit

Victor Peng

clearly that point very of very we're is that at so well of full get doesn't we I really I here, a early trying features not candid, good this XG as very deployments There XG, because being is time, it now mean XG the to going And technology. and not I'm umbrella don't to really just this opportunity seeing right? have capabilities. to as guess, So to thing time. the thing a is are generations in Sure. standards, the trying single same the that is, what be have of do always And

see XG of well as, of as So technologies, wave you're going to course, deployment.

that a lose believe that traditionally growth, baseband on way in Hopefully, that much because on in expand again in with engagement going baseband. think and we radio, be of continue baseband, Versal it. that our that's that, strength I stronger And areas was is seeing we're our but to still XG this hangs so right? like in not of ASICs capture success saying radio as to that lag certain those we'll forth, participating What And maintaining when the in generation, our We course so to we're catch by haven't. up, right? they I baseband are still tend part there's the [ph], of we of do can. powerful some we some the some we which first think we of more shot to would the that certainly because we similar and it's of holding to is more have of value course, like on in

more little a So I comment. that hope my bit helps in

Operator

Our next question with Rakesh Mizuho. comes from Vijay

is line open. now Your

Vijay Rakesh

good just It's quarter again.

year, in figure Center side? side, Just I And some then FPGAs briefly outlook grew can this the the wondering XXXX Alibaba -- you How saying Huawei, a more mentioned Amazon you when in I'm characterize traction on comp there about growth you Data calendar how and and you think, XXXX? in on getting for color give XG do look to at obviously, you would nicely.

Victor Peng

Okay.

would just going deployments more will these are guess, you XG, quarter. I our So early of might to it. We're the But, a for when fiscal want These say these have which I to good calendar on for is of we deployments. XXXX, and But XXXX, obviously, gave to think I what we hear early are to guidance Investor see you're Analyst guidance giving the again, it some right? XXXX, and are -- broader Day So wait for current guidance. not portion right? again it, have for still the

peak see So right, on you the going higher on ups some be higher if are in a and overall revenue. big to area integrated for basis, you on But will curve XG an basis the quarter-by-quarter and will in down.

more question future is we today even be all the and baseband. were the today, we of this past the to obviously going strongly generations Versal And in some in even RFSoC, earlier happen. our I terms for of we've in are that's will -- reasons discussed we no than generations XX-nanometer think positioned stronger, and are there

this very about detail see are and So some you on parsing although will we in feel we again not point. FY so, at good XG, guiding 'XX

Matt Poirier

question. more one take We'll Liz. Hey,

Victor Peng

I identify and think second on Data didn't at additional unfortunately liberty part the mentioned Center asked I last So we you I I that one not is do FAS, what engagements, this think. them, have I'm Amazon. to because beyond point Huawei saying thing is what time. our we FaaS subsequently been and at But that has also which deployed in publicly Alibaba already had some engagement in have additional that, We've who production. announced have I'm

We today are was we to name, and activity other really that have have ones. we can't I I have seeing progress good the there, but other ones that referring we but

FAS So there deployment. will be more

the there. is takeaway this So

Vijay Rakesh

I if Got it. And just one follow-up may.

good side, in any is ramped you too cost early Do you XG, see traction the low from a it being On radio of kind there. alternative coming FPGA the in there still the or see ramp, ASICs competition FPGA you looking on kind numbers. more the technology of obviously,

Victor Peng

the some the the Yeah. not the on not quick side wave might might XG that what side. answer we along in Really pulling deployments, to of generation referring is of that is ASICs that because that the I first persistency that, of baseband there baseband to in and was come fact have displace radio look in the

is we has we certainly believe baseband. second some in there generation see the there again, in and yes, always traditionally So, the persistence persistent some been are third we should But, competition. -- in and radio ASIC

Operator

questions showing at I'm time. this And further any not

Victor Peng

this have Pacific X:XX Okay. call everyone of a Well thanks playback today. Eastern X:XX PM at beginning for Time. We'll us PM joining

copy For please Relations us of our on visit a Investor our release, website. earnings

of XXXX fiscal year the on the close. XXth Wednesday, will earnings release quarter next data Our for after be fourth market April

attending conferences We the this following will be quarter.

in the Conference And Technology our Francisco York May in hosting well XX. on also be we'll February Internet on Day XXth. San as Analyst Morgan then, Investor Sachs Stanley TMT Francisco San Goldman Conference as February XX, and on So New in additionally, City

more very completes our and the save participation. We please details look forward seeing to there much thank and call you This So for your to date. follow. you

Operator

have a participation and conference. great program thank Everyone and you today's disconnect. concludes you in may your This gentlemen, Ladies day. the for now

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