VICR - Earnings call transcript Q1 2022

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Operator

Good day, and welcome, everyone, to the Vicor Earnings Results for the First Quarter ended March 31st, 2022. Hosted by Jim Schmidt, Chief Financial Officer. My name is Matta Amrivamager.

During the presentation, your lines will remain on listen-only. [Operator Instructions] I would like to advise all parties that this conference is being recorded. hand James, will may I now, over you to proceed. And

Jim Schmidt

I'm to Good quarter 's XXXX. Patrizio Financial Vinciarelli, afternoon Phil ending Andover you. press Officer, Vice am financial of Vicor a press and issued ended Schmidt, I Officer, has and XX, Chief Global first Thank today, with the results President the welcome on Relations closed Corporation for we in Chief for the earnings March Sales and Executive Jim This Davies, and website, page markets Marketing. March three posted been of months summarizing release www.vicorpower.com. After our XX. the Investor release call our

The forward-looking assurance market correct. this the by In any SEC conference we is discussed and announcements, Form well and our faced the with regarding be Edgar profitability materially the products, no remarks may listeners of a differ We these remind statements April will call, being of System update any light potential XXXX. the undertakes prove various this the call, made should today may is and explicitly that statements the of expectations Please midnight dial-in copyrighted on forward-looking for X, events today. and this in information The contained at set replay Item Reform management's number any as risk risks recorded we of after risks statements statements Form the document and and and X, SEC's call as forward-looking is XXXX. uncertainties. implied during XX, will tonight purposes beginning statements to is Litigation through for and results available Securities during are remind we rely offer in by historical forth of of to Act are filed conclusion XXXX uncertainties, can relating Thursday, XX-K, call. in also dial-in for May provisions or of passcode including This the Private call expected release. call current only conference we from remarks this X-K this planned make upon customers, Actual on on call, this I March which press obligation during is not are uncertainties also and Vicor A note today's Corporation. The statements, of spending, involving Xa today's and set Except forward-looking website. to XXXXXXXXXX, accurate statement the fact discussed the XXXX. call this XXXX. filed also of you provided forth issuance those of matters property passcode Vicor XXXXXXXX. available this our including capacity harbor as potential be opportunities, constitute and current you followed our expansion, I safe press in this no via release. under growth, replay sales information today, such

mostly Form for new our your refer change recent along I'll website. replay press you QX of upcoming page review performance sequential of take now addition, review turn call, Investor a In the questions. on will quarterly of developments P&L our webcast a market which with on Relations will after remarks, items, and or Phil, Patrizio, In shortly transcript and available focus our to will release and Phil today's to XX-Q and be balance sheet the year-over-year my comparisons. a for our financial I I will

Advanced Products in same quarter. % recorded today's sequential million decrease Brick the $XX.X of of from X quarter prior increased X sequentially, a million, ago. XX year at for for total in revenue from from as of were decreased revenue release, XXXX. relatively percentage stated Advanced the % increased first XX.X%. XX the declined % $XX.X As press revenue and prior approximately the year-over-year. Shipments Products first X.X% quarter Vicor flat from fourth increased to Products while quarter X.X% the revenue sequentially Exports a the quarter quarter X.X% total a stocking sequentially, revenue, % distributors

correspondingly of Products fourth decreasing For increase revenue with revenue. quarter XX.X% Products the a to share to total of QX, Brick of compared XX.X% to XXXX, XX.X%, Advanced share

primarily of of the incurred higher of as support QX increase with disruptions, associated XXXX, XX.X%. to and we production, respond gross margin a margin cost a recorded as quarter the a from gross margin, chain of to of fourth activity higher volume, in result to lower consolidated profit manufacturing Turning sequentially an outsourced XX.X% costs freight as of Gross supply quarter declined to well spending our levels increased in panel manufacturing staffing and expansion. startup full

a QX to continue margin in be at X.X% revenue. tariffs million $X.X and of on gross addition, drag In

to reduce and professional China The compensation $X million. of reducing now goods $XXX,XXX tariffs respectively, Total amounts the compensation, QX and X.X% expense total of services. cost expense SG&A of and expenses. was equity-based turn in increased continues. by work R&D included Our fourth $XXX,XXX, I'll totaling activity, for increased engineering QX imports $X,XXX,XXX, approximately operating from by quarter operating from to XXXX, driven

of income a the GAAP for shares. operating million, operating an on share per Income totaled quarter recorded a of $X.XX based fully X.X%. share Net of QX benefit $X.X of tax we margin income earnings diluted million XX,XXX,XXX $X for representing diluted taxes $XX,XXX. was QX, were count For

update position, financial Before our brief a and I our review about workforce. just COVID-XX

influence social manufacturer, of due the from our and as In the the at three mask might we COVID distancing potential essential on onset zero timing associated of manufacturing such the pandemic, unpredictable. Nevertheless, shifts the of practicing by on adopted our now of with parts of caused discussed, policy influence of have negligible. disruptions results continuously chain. because COVID-XX in And previously facility, our operated pandemic and are the a risk and or when to cases China supply influence control, much or effect impact the the outside Andover performance, extent COVID-XX are financial of using designated particular, are occur. estimate As our absenteeism has operational our we such cannot

cash Turning sheet. and sequentially the million. All reserves QX are flow X.XX. totaled and at Inventories with and trade and increased $X.X reserves QX. to Cash XX primarily for Accounts of current. at totaled a net DSOs and equivalents the our be days. totaled ended cash of balances million with receivables manufacturing Operating Capital totaled net the million quarter for to balance year, at quarter-end construction with We balance end the approximately short-term million $XX $XX.X of flow $XX.X $XX.X million X.X% spent million equipment. $XX for turns progress investments receivable quarter. total at to expenditures annualized for scheduled through million $XXX

Our I'll well schedule and sequentially and above is the factory book-to-bill X and by came backlog expansion XX.X% proceeding XXXX. with bookings now from increasing in on address one-year fourth on-budget. of backlog. QX quarter

Turning QX. integrated online for Package. fabrication and House to acronym ChiP of is we in ChiP our to expect bring beyond, in Converter the our starting manufacturing expansion XXXX second quarter

Until test, production high will foundry will plate, existing shipment ChiP and our Vicor's Our and short-term. foundry power complete process increase the modules mold, finish capacity density to in ability online, establish ChiP the flow limit assemble, quality to high-volume at automated in is in-house our and levels. world-class break

our During approving full on and of quarter, Once production in qualification installation line working this undergo installed, period. in are we equipment ChiP the foundry. will

which the we we merit in in months, increased operational fully coming in and positioned to year. second becomes our line operating half will the quarter, expect of the expect As finalizing result complete significantly to will and be this are efficiency, improving during output, results annual process. we Also the capacity,

focus working density operating our Vicor of which to teams We've advantages in U.S. success state-of-the-art in development on long-term close co-development power is allows Our with high unique our delivery the for the automated hard world-class proximity next-generation technical products. combine integrated technology. to based products. facility, power and performance approach invested remains engineering manufacturing to We're of module our pioneering on based a

Our needed an deliver cost - of us efficiency power At manufacturing aim are strategy volume the demanding we most -risk cost is de positions and across for operational drive heart output highest customer and that initiative And to chains to embarking on a our also the lays applications. foundation the in Vicor. delivery centric the initiative supply become company. reduction, excellence to

in Vicor variety a is entire customers Our of supplier to of choice engaged markets. end power organization for to delivery make

related available. follow-up you committed to the as to I you that, Phil, I of an that ask overview can as we are will one we achieving And limit of developments. many We operational to recent provide Phil and questions. Patrizio, that then a market in With and will question can yourself excellence. your our respond take so time goal limited of

than address, have more If one to Phil. back into you queue. please topic get

Phil Davies

Jim. our from performance you, and investor my comments community. has of a attention business, short keep Thank high primarily computing focused on a and received I'll lot which

now computing AI is volt growth applications being our Center in AI The they increasing and server, backlog Data rack-based major global into brought Our new clustered XX driven market. deploy are by rapidly customers ramping GPU Cloud and performance accelerated bridging to high solutions as their hyperscalers systems with supercomputer, cards numbers.

volt are load gap ramping accelerated Volt expanding, a aspiring The for multiplicity solutions of technology XX solutions with ASIC XX lower bridging cards, well contracting. empowered higher and power from and to cards, XX power of GPUs both as very raised as factorized volt Vicor point GPU the not XX volt, Additionally, direct competitors separating for is have AX. requirements, power which

multi-phase clear, business de are vertical architectures will intermediate system delivery. Specifically, soon, no power to require achievable only supply is other modules are attributes chains. the Pipe different up at And of vertical performance Vicor knockdown. performance industry that industry Vicor Data bus computing solutions our power lateral than multiple faster capable of performance Very a and of key than sources is they providing. level high performance current improving Center why and rate proprietary density be that broadening applications opportunity -risk Vicor as architecture, with any system seeking going is To and require high-volume computing such the other power solutions.

performance of preferably achieve deployed consisting and higher higher density, and confident noise, will few can our a to vertically, necessarily wishing being not current our accomplish advantages opportunities solution with major good power We components. continue with sources with expand performance. a multiplier performance, With be multi-phased noisy, over higher of enough it lower achieved wins remain a XXX customers. and that to does large, efficiency, and However, Vicor heart do to mean multiplicity design a able system modules laterally or can

target our markets, quarterly discussed power turning As power design delivery high to previous solutions their in systems calls, demand engineers continues with power for modular of solve density across unabated Vicor's the solutions to toughest challenges. all

of comes positioned As our performance be QX vertically to in event are the anticipating computing full opportunities new with number integrated Vicor. new eagerly for our key take better online current high who also increased advantage high-growth and customers of capacity this will we

in our exacting discussed also power by growth. train predictable a to qualification have up enable customers. and market we will having for -- process growth and our major in of strategy sustained Vicor As A full is manufacturing demanded will vertically automotive previous be vertically long-term standards integrated success the part meet a us automotive quarters, gearing the

and plans. developing That leading OEMs be now I to engagements will Jim, take questions. with Our concludes progress Patrizio, exciting new your initial remarks, of this ahead market continues my in our and and

Operator

received [Operator is of Needham it we've Instructions] first from our question line Company, & from coming already Bolton the LLC. and And Quinn

proceed. may You

Quinn Bolton

taking Thanks my question. for guys. Hey,

next-generation Watts. multi-phase a large that participate will is HXXX and viable to your this, card its card yet Watts above Vicor that powered architecture, this power I'm of this video wondering you this XXX voltage by evidence can customers of at of is XXX has in X,XXX if amps One recently and next-generation customer? or consumption regulator current talk multi-phase showed architecture

Patrizio Vinciarelli

surprising. we customers question, applications, general or in will on your of is general comment specific addressing not specific which policy, but matter a not As

relevant made Phil question. points key think that to addressing some are I your

usually Vicor bus First stages multi-phase intermediate technology requires of the all, two the in separates processing. and XX from volt above solutions which power GAAP contests architecture, would of yet the of architecture anything

in they've pace as It years, few a density to capability architecture keep last the point continues our certainly respect intermediate require your is that the can technology, this levels, and are with applications. what adapts but it to of to advances, an account we the that These and solutions. of a the with with. some general rail, and of increasing density, of of current you just rails all Vicor from sides and primary blocks. solution. past And advancing make solution. fundamentally advanced made be architecture know the terms up in rapid comments, your Our achieved. terms point intermediate by way, rails. the architecture bus and support at the and is not increasing also is question, But bus believe, auxiliary industry GAAP, choice these, handicapped cannot in of building To multi-phase to current advancing continue fundamental terms Increasing for that of

Quinn Bolton

maybe just follow-up a to Patrizio, without on a that customer. quick speaking specific

do advantage you an us multiple say power over factorized some of approach? how sense of watts terms that's X,XXX or architecture or architecture the multi-phase more of has If you today's you in give consumption, hundreds efficiency bus power look can architecture think and power efficient much savings what at power amps,

Patrizio Vinciarelli

give we generally primary of example integrate thousand I to GPU, in on a the you rails [Indiscernible] though general say that the range. in I'll So [Indiscernible] example, the apply or an should realm between amp

bench So it we lateral of of much. the increase else a benchmark collateral deployed advantage done relative we notable modules by XX own something vertical And percentage efficiency an to to points. current solution, the anything And far the getting size lateral that apart can vertical you're ASIC. with the us solution we solution, from efficiency adopted that sets close market And be multipliers multiplicity as that's by can or has company involving a on been which in industry. our recently

Quinn Bolton

Thank you and later. get a Thank Patricia, you. come with question in back queue the back I'll

Operator

The of from the line from Securities. question next CJS coming is Jon Tanwanteng

You may proceed.

Jonathan Tanwanteng

is considering system. or a such first perspective traditional not purely something Thank a else to their that. afternoon, or from follow-up one other using capacity-related that factors Hi. that XXX there a Good decides the gentlemen. as with power you processor When price taking go they're My to we're for questions. my of? watt are Is a decision customer that thinking maybe

Patrizio Vinciarelli

the In the in play of commodity within and best the a point, compute not enable real Well, are density The of that required the at density all OEM the the list agonizingly advanced in essential is factors generally the priorities. multiple this a your to would with, USIO Obviously, it there can And to in you opportunities the satisfy people customers out that expect. the computing consistencies larger as of solution In appraisals rolling on. various are maybe I of like as day, imagine solutions only there out, and different question. objectives. the understood worlds, end But multiplicity is not larger set all to OEMs, work speaking, world effect nobody to proposition real-world. those capacity available. suppliers, are goes limited the

Jonathan Tanwanteng

at are are, at your your still point backlog perhaps this think I there long. Then these a in risk your enough. there backlog Is because orders some getting so strong. second-sourcing of is lead that, And anything are fair Having this Okay, there up, is times point. of customer I risk at understand. said your just

Phil Davies

which going lot can, for -- that is second strong the other the and backlog in possibly to is is deliver Don't year we I'm the risk really Jon, backlog in first as better backlog that they still strong, at any are this than very quickly No because it. want us. really to confident half this as in us of demands customers’ the see the time is point a Phil, the why half look

Jonathan Tanwanteng

jump you. Got it. I'll Thank queue. back in

Operator

line McKenna from Inc. The coming & the is McKenna Don D.B. Co, next of question from

proceed. may You

Don McKenna

Thank guys. Hi, you.

would years highly process as previous you, long I'm preparing the address the achieve increase I much bit the can were in then coming versus as demand? with the operators Patrizio, back as the question, strong how on Is envelope question. or the guess, expanded anticipate in you times a science, of art the just of Phil, and little the range $XXX see you the of spent Just to other in number, follow-up And you've I'm how subcontractor. it to back a up and result lead And my new same a somewhere was of good be valued. efficiency you before manufacturing your learning was number an be what I've how you curve, in wondering the considered plating as current and been past then much million. for

Patrizio Vinciarelli

achieve that's and redundancy, team. I going equipment, question we've uh, first. the Let we're me where to have contractor outside very favorable, quickly been working well-trained better because your to take that able a achieve we efficiencies with expect

to I the to and over going more do unpredictability than accomplish ramp be with Phil? we're predictably So faster we've the months. able expect -- way the progress, to of nine in been last particularly able to that the all

Phil Davies

to out really We're Yeah. very at working regards or week not with Products customers closely to XX rate. weeks placing are Products orders expanding And right the that Advanced they're XX with our the Brick so, obviously sure backlog, range. that make we're lead in times.

mentioned base a while also touched American that new with new really customers. new European programs market, applications got starting to our It's strength market the we've we've expect got in for go in we demand, as on Great. as demand haven't remarks. And ramp, really now We've existing so it's North continued on to programs it's the the my I coming previously, mentioned customer XX-volt I've quite driven. in those. market, China prepared We got in bridging

Patrizio Vinciarelli

do We -- expect

Don McKenna

much, very you guys. Thank

Patrizio Vinciarelli

some XX of of other months component supply issue clear Once be disruption. to capacity, chain it have it's the availability lead the the limiting simply I'm been facility, of and last one factory one been integration factors capacity also hasn't times. over about in bring vertical expect to the demonstrated do because additional We brought we sure, and

the particular, degree that with components As even were semiconductors, unique the unfortunately, the are in we to you private for some laid particularly do to step-up semi-conductor component into it's variety. the disruption more just those a and policy. dependent If the of heard vagaries remarks. that characterized I've zero in effect But some past, us led respect that we've able with Nickel issues of to they That's progress, major been his them. secure and semi-conductor type a capacity. and in been to on. that the availabilities. right? developed He not Products some Chinese chain, of the to Covid some parts, [Indiscernible] supply Jim exposed We've for particularly Brick In matter

Don McKenna

Thank you very much.

Patrizio Vinciarelli

Thank you.

Operator

The next question coming Dillon is D&B of John from the from Capital. line

You may proceed.

John Dillon

guys. Hi,

the somewhat counts? wondering, pin your congratulations lower on I'm really motherboard technology than It's multi-phase really the all, opening the But latest you numbers, lower technology But board of and component in multi-phase, space, versus I phenomenal. lower the copper, First want ask versus booking lot point-of-load still your the about remarks. it's resistance, up which expected. addressed socket about today greater technology a IO and does you reduce your I count, to free

Patrizio Vinciarelli

Yes.

respect is terminally heat that in ESCO efficiency -- within is efficiency. GPU into envelope the way, power is they large differential requirements Our lot amount are increased both in as too of which manage looking by in as if Often capability heat and heat, the efficiency % that current XX one like and [Indiscernible] soon was % another by very doesn't sound XX a the relevant solution solutions ability typically at itself, in because the is running the the push on generated need translates at front and with generated system integration, elevating way the to heat to technology it, now And it, will solution delivering limited capable within looking to by double-digit with manage, improvements need of doesn't the the the car they way be the to regulators, of -- silicon. that compute becoming vertical of is That of reactive past generation multipliers itself. a the with much

not competitors, in it, particularly terms allowing density proposition the one to way of translates is need, look efficiency then in to if the at the a which we in is into primary in limiting relative enabler capacity a believe consideration, its improvement, an value a OEM which fact. is compute greater bigger reduction So for

John Dillon

of that you. kind on question. Got And plays second my

XXX to That's the solutions. like GPU and the watt you versus Let's lateral about sounds you power you're about the say due watts and the right? network for solution % be -- going less than distribution point-of-load multi-phase. the XX you have about power have of Vicor a efficiency, XX can competitive It save loss

Patrizio Vinciarelli

active given same lateral a multipliers system, The was for multiplier current from while the silicon better supports that silicon quieter kind vertical if in you deliver of multipliers performance itself. you've domains. by to just the The architectural a uniform perspective, uses side implementation of bottom professional specific area will, golden The with sides the vertical will, of a And deployed you voltage of vertical the area on in which its example block results three, what I of same, voltage. the silicon, in action if much on this primary particularly within results a way call of was first rail the system, more substrate, in distribution of seen we more that gets the which active distribution the building the GPUs. itself the those gets factor at in element, a the nearly deployed, its efficient in reduced power current

the ability heat, effect addition the at reduction it, in it and run in frequency operating over In compute or run the clock solution, capability. the to higher to and again,

John Dillon

saving not higher-performance enabling So are only you're a you electricity, computer?

Patrizio Vinciarelli

Yes.

constraints capacity. directly degree, the be deliver in advances primary some call These savings more within what much more more ability across surface power translates potential we equity to leverage URL. or active or a solution the the and to which power managed includes that compute the advances deficiency the fundamentally, either So delivered enable to the of area thermally

John Dillon

like about on of sounds that, talking or by competing and you're has their with CPUs, that going watts of talking you're about top datacenter all supercomputer then a And of it thousands hundreds thousands if wasted you. Got solutions.

Patrizio Vinciarelli

proposition. element green raise to these that's bar. who think the the is obviously which industry, what a capacity, continue I There's about Optimally, all it's drives value to compute --

John Dillon

so really guys. Great, great, get in this I much. Thanks back queue. will is the

Operator

coming Craig-Hallum Richard question line Group. Shannon from is the from Capital of next The

You may proceed.

Richard Shannon

Thanks, guys, different them, taking follow-up mean What for few to describing here, you're Patrizio, alone just my question. last and out here. there. better a others don't be certainly my ask to improvement. what than have that's savings here, to belief questions delve heat a on something similar a way on I is but think Power people's you and this want most would that's much solution savings dramatic

So the it you are that are be of systems delivery not, to and levels seems if like solution. using then you are expecting other sub-optimal you're sole steeply a going ASIC in GPU power a Because at source? highest accelerators customers

existing kinds customers these levels? power are, state expectations what at new and can across generally, you of your So

Patrizio Vinciarelli

feel Let were then me take in that parts weighing. and

as can a of imagine, I say general, in solution our nature proprietary as power as also because solution, Factorized distribution would Solution, a So unique you and with Power architecture. of the

power mentor or earlier, choice, it from a performance. to effect, of tends to customers and of In is discussed Vicor with a with being it bus right? integration limitations itself. a better be product, solution more type it. intermediate with multi-source solution with Power the of an The handicaps. it architecture And getting comes element down its to with without product. But Factorized a respect being a or the to more system Vicor which single-source, So performance as proprietorship, have single-source capable being make

Phil Davies

Yeah.

-- ASICs that new to to the -- to the network higher think add not want we're lateral look we've with we're for that using if the stuff the have months, at for l on in do and and vertical converters but brought of nine lateral working six customers doing Vicor's call. on processors, if multi-phase they we last, don't I bus now and have a you for about I use of that, they're talked they also multi-phase example, future, They're also to in know, getting current that, number in some Just that months, last that. options

So we've times they're very they have which our choosing the spoken is. of choices about what says many is as Vicor advantage clearly and solution

going So they opportunities want those their they're need customers. it performance, be to compete they doing and the single-sourced for on performance, they because are it

the way they're so the over multi-phase. choosing, Vicor And that's

Patrizio Vinciarelli

But just not the is are it's the solution, that Vicor to be clear, other only solution there solutions.

density's less solutions kinds other be modernized, in a realm, to tend can all the with lower to if make of the applications viable. the made overall they demands to of multi-phase industry applications be applications and fetch demanding to be them again, converter work, The grouped with can broad it's a and hopefully have they multi-phase which broad architecture with the on more sense contrary, bus challenges and bus phases multi-phase implementation application. with those customers to for requirements, perfectly that opt suggesting not there applications the there and the Particularly industry a that solutions of certainly the be in reliably, current We're from an work perspective grow can otherwise if would levels allow. requirements make multiplicity we their are for dynamically and of and do a current

Phil Davies

We because there highest I device XX good to we've as increasing highest we're know for And well. very the capability. bus us the power performance XX as density, business and that's like well got we converter, supply that its

too. multi-phase the to low-power applications in support those So happy we're

Richard Shannon

you on it. speed. being in those implicit follow-on about for My half the Seems second here half. to confidence your have comments starts, Guys, manufacturing, better question thanks Okay. getting appreciate first your that than up the

the third first. Not better quarter, this you the what fourth quarter? full maybe at second in color XXX bit rate about on does little That next you easy % tell right why demand? just happen? about now, in sometimes going can be talk When to commensurate can or with running if maybe point, So do have here. at at full you Thanks. say confidence to are steps the you more half us than least a give that And,

Patrizio Vinciarelli

that's have I being it team, that their process our unpredictability chain process of going with the steps. integration disappointed of in by lack and been anticipated, to I've Not [Indiscernible] been and have Products when of critical vertical and some factors very in predictable to to the of is last the way say, control we products, of of the bottlenecks in disappointed. respect supply important steps, units just to combination step as able they had as integration And output. But a up quarters, be at Brick revenues destiny be there's rates that investors but to impacted can So getting soon been with upsets the they're many been fair, frustrating. having particularly, including confidence over play. the the three of a be also of

orders into them terms we're in going of obviously will we're who his in times piece that backlog think way we get this team, July the that had get all going of critical time, full and And are than to and point of revenues our I to with I stretched quarter, destiny. again, as be that control we like third equipment The And last out, the see is have in be. of longer do a to customers arriving that at equipment place start then. would the having quarter. expect they trapped lead to is with

Richard Shannon

guys. Great. Thanks,

Operator

line Doug of Promus question Combat from coming from next the Capital. is The

may proceed. You

Doug Combat

gentlemen. Yes. Hi,

said, deeply. July quarters, Just factory, delay question. would time have What coming online need you gone far a your Xst produce guys to the them start occur last as as factory out will affected, frame. issues the the to supply to you about the you to components it's and products door export stock previous solving as to and the meet have getting three components internally are And global finish quick you in that that follow-up to to impacted How demand? from those the customer chains

Patrizio Vinciarelli

going to front, a the all it train past, too I from to year. see, because we're in also respect respect it's relatively think and Obviously easing outs, preliminary, carefully support our online respect beginning still availability increase definitive be this to the don't that, we're expected to integrated very sure in supply that respect of think with our being made requirements. I are of in way want to time-to-time focused place, this as getting issues, that proprietary I'm semi-conductors have and able securing that later with I'm coming to we capacity making of the we've very and availability the and to in being Well, discussed beginning fab to of is unavailable the once with long-term to we've variety With I output some watching the strides because sourcing at rise see getting some waiver on use. process general parts with get that both to all component respect that to not that steps have and availability we

Doug Combat

Yeah. That with was was it. where done I

was all all were to the in more layers have triple was around machines, and wondering running, world. everything all talk you have do parts. aggressive you line double the from most heard concern guys parts start the my standing That engine the you that the don't we've so You the can people, have because then you ordering of about I securing if need have you the the you because and alone. semiconductor when just and up of assembly

Patrizio Vinciarelli

can looking to of build unavailability run of guiding proposition, disruption that's order not years, that of we wouldn't it, next we perspective. level safety work that this particularly bread butter last due are have I if a shouldn't for couple that when availability, of are we I stock level in We say from going to ensure called that to where the a mouth to double can inventory. critical comes component without opening. wouldn't capacity be several components. been call inefficiency operation difficult to the the do perspective a to our build use we safety that the the if a logistics stocks some way when way, of do it to buffer run hand of the after some in double, plan our appropriate But and some in call years, that stock. over have doctor will I are you I components people it's spent it are have and we do it like Well, to different to of it

Doug Combat

Terrific way COVID. are unusual we business, Yes. know not run that's times And but the normal very to I after a in

very much. thank you So

Patrizio Vinciarelli

Thank you.

Operator

The next question is from Needham & coming Bolton from the line of Quinn Company LLC.

Quinn Bolton

like if Hey right. wondering you got numbers record quarter It backlog. first, my follow-up, backlog and record looks the first you for quarter The could on $XXX the guys was bookings a quarter I've guess that I the confirm did guys, bookings thanks for the up in if indeed my taking first million, just near company?

Jim Schmidt

a was a bit little We of came had close. it short bit more. No, but we one little quarter,

Quinn Bolton

sort year, sounds Okay, of is like it that. of last so QX it

Patrizio Vinciarelli

Yeah.

Quinn Bolton

it. Got

Second say mentioned a some Could for that the got is give that power AI-AX on more wins out mic XXXX delivery. of vertical sense specialized is and when vertical XXXX applications. I ramp, question, further, power you've you in a us you initial or ramp or know beyond? power couple GPUs vertical or a

Patrizio Vinciarelli

of we If level most that With cast as slash are yet millions capability in set provide general are applications. would for with high-volume fully in choice part effect, their maturity fully making not leading lead on for vertical power very edge in two in have to the of delivering. the leading calculated Those components terms level particular a but technology. maturity, customers the progressing vertical. are, So of of generating delivery the that of that, is scalability that I'd Vicor, and of be units up the

would of is good to of in of that there a and get landscape, sense lot what the terms, you means. it the that a to think it good availability, power know be So following I think

being up traverse or to So in the a and that active using the reach That ASIC, multiplicity the multipliers. North, right, the edge laterally, East to cases, domains the ASIC architecture devices East, under with these of South, north these has south X,XXX to GPU deliver some delivery of the application the entry has and leading It's in that the area the of and amps. particular the West, of points lot and the works with in current the devices. power of architecture West of GPU and current

stands inefficient scalable Law remaining X,XXX Beyond in in power Ohm's way delivery of the architecture. amps, it

vertical those of you the but another active under the current Essentially and power silicon. end power carry delivery, of from steel, the occur delivery the other site is the at bleeding Now, edge, area -- vertical reduction the of as delivery losses with drops the and go There's spectrum. try It's losses. amount advanced, voltage somewhat very power away. in

system in you with, in central vertical vertical about with or differential have the again, one you of effect can, If of of full multipliers lateral your with ASIC. in associated into this the of enter golden respects. side, is that area innovative which same are module on otherwise point that lateral suffer, an places provide in same rail in entry systems. DCF. we multiplicity Chrome the GPU a it effect the a delivery call voltage power But it suggested vertical year components, to three the the of as power the pre effect But a retains [Indiscernible] the essential direct -reduction delivery, in level lateral supplant architecture, used of priority to losses. ASIC. the brings reduction would bottom car multipliers, within the earlier, It An factor at power the them complexity that And the a

next threefold Full From in in tested see, that it's That and vertical. the be lateral fact on up edge important X.X, SCC. into distribution answer reduction it's certain evolution opinion, applications in I and power lengthy vertical have it's a being in good your still system high-volume is this the a question, for later year technology. in years to my going dependent major plant of are terms two some going very sorry a applications. So grasp but power improvement production the PDA into leading within to year. the drops and are large technical VPD of delivery to mass but think by of handicaps, to lateral for we In is the go efficiency provides scaling applications and disc away, a

is lateral, the certain proven vertical, with perspective, solutions So full which to, the in building Amp mass away. it of years but from the obviously X.X, two millions that a the again, limitations evolution is by which which still a major with that we'll is way tracking lateral X,XXX production get is in vertical of improvement blocks technology, threefold, but with mass production be conventional same making to building blocks, viewers, terms the of PDN

Quinn Bolton

Thank you, Patrizio.

Patrizio Vinciarelli

you. Thank

Operator

of is question Jon line Tanwanteng the Securities. next CJS The from from coming

Jonathan Tanwanteng

and Are you're pricing, supply taking QX. they something, mentioned can bit Hi. actually near-term if worse this a maybe in later getting chain Thanks in regain just of talk for there levers, my Patrizio, you with facing you to easing better or help year. was any constraints follow-up, margin? could I that in you the are about guys. wondering perhaps the possible if new pull, that

Jim Schmidt

Jon, the constraints is outsourced production capacity relatively some dealing same. now, the in to environment think right that's I the similar we're The with last quarter. -- panel

Patrizio which there in. zero implications the wrinkle in are China, have new We there's way do our as to tough predict. a coming semiconductor is with, the, to have through mentioned, COVID that. We policy supply making contend We're that

I to say, fields number team And saying that to hard I extremely QX make and and our and So overdue is think quarter. support up clear notably, That's working to XQ factory this is happen. should our expansion we're that running. backlog we're most like customers. one working hard the And very job get focus

Jonathan Tanwanteng

Understood. luck. and Thank good you

Operator

line coming Alan question of from Hicks Management. from the Ainsley The Capital is next

Alan Hicks

needle products. that a revenues? was going been your talking on I question on XG you've in products of high for out? expectations, dependent terms of the a load potentially that had technology Good front-end know coming you very bigger the of about afternoon. is move point couple And When Had years, and than to it it as

Patrizio Vinciarelli

Yeah.

I AC-to-DC understand has if several front-end think, products. products or do your it with to I question,

Alan Hicks

That's correct. Yeah.

Patrizio Vinciarelli

made we've So good very progress.

We have two delivered sample we've engagements. customer major And quantities. initial

million. about up these the of of in is of engagements two One the this $XX year, revenues order of to into going second substantial scaling half be

AC-to-DC applications. about is at stage, component we products early revenue tested density for been in our two get of to is deployed good lead this the by presume customers. And the has of deal mix an quantities. of a but appeal have still them So one And high substantial

Alan Hicks

you of that say Can Okay. application is? what kind

Patrizio Vinciarelli

many applications what say are, we the can Phil, I without customers AC-DC think.

Phil Davies

and some got edge if large We've like, opportunities, Yeah. the are Center lighting that you some computing buckets, targeting. three opportunities, Data opportunities. we're Those

interest XXX of AC higher-frequency the United also in of Europe. aerospace they operation a in hertz need We those where the here lot XXX in versions area the have products in States,

doing opportunity Europe is large sum in somewhere of defense $XXX, with versions actually million a America, North $XXX of gross we'll So and be margin. for that very in which quite range an products, aerospace those sort nice

Those year, So are are computing, we're which very this the hard aerospace front-ends customers, edge market and to interested in and having working of the as the too lighting, broad market through I to four later defense we areas. versions bring mentioned aerospace. centers, to defense, data these

Patrizio Vinciarelli

So the first --

Alan Hicks

ahead. Go Okay.

Patrizio Vinciarelli

lighting category from several lighting come to power of in going is megawatts of contribution location. revenue the Major one in

Alan Hicks

So that's the supposed in ship second to half?

Phil Davies

'XX, year, second obviously revenues then 'XX. start in that up next ramping and the market in half We'll building

Alan Hicks

or that -- does to on technology that depending XG across-the-board Advanced Products? your apply that is Is

Phil Davies

packaging's No, that's packaging, the and yeah, control a using the engines the components, for that we of use other same systems same our we also leverage lot same. technology,

Patrizio Vinciarelli

most application the house of and same ChiPs, requiring and requiring earlier. a Jim fab, conversion going denominator leveraging in components, same same denominator it bus or package, effect we already of XXX, through all of were packaging through a XX, an waver-like whether fab volt the requiring is at terms Think or application They're us kilowatts. All volt three-phase in to methodologies our common front-end's automotive process the it's earlier, lighting XXX -- steps a convert it's these at younger figured systems, control common find a or technology as application in multipliers point-of-load of pulse. going same the describing car

Alan Hicks

quick, real the soon EV in item? just do item revenues -- production And Okay. how you expect

Jim Schmidt

increasing of then first 'XX customer, the across. for first 'XX, 'XX end the and OEM, 'XX, By

Alan Hicks

very Thank you much. Okay.

Jim Schmidt

you. Thank

Phil Davies

call? you And to I that, end with could Operator, the please think an call

Operator

that conference Everyone, course. the call concludes Of for today.

the all You may you enjoy for Thank joining and now your rest day. of disconnect.

Vicor (VICR) 22 Apr 222022 Q1 Earnings call transcript