Cirrus Logic (CRUS) 2 Nov 212022 Q2 Earnings call transcript

Company Profile

Participants

Chelsea Heffernan	Director of IR
John Forsyth	President & CEO
Thurman Case	CFO & VP of Finance
Matt Ramsay	Cowen
Tore Svanberg	Stifel
Blayne Curtis	Barclays
Christopher Rolland	SIG
Ananda Baruah	Loop Capital Markets
Rajvindra Gill	Needham
David Williams	Benchmark Company
Vivek Arya	BofA Securities
Derrick Soderberg	Colliers Securities

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Cirrus Logic First Quarter Fiscal Year 2022 Financial Results Q&A session. At this time, all participants are in a listen-only mode. After a brief statement, we will open up the call for questions from analysts. Instructions for queuing up will be provided at that time.

conference being this purposes. for reminder, a call recorded is replay As would the turn like call I to Mr. conference now over to Chief Financial Case, Thurman Officer. Mr. begin. may you Case,

Thurman Case

Thank you and afternoon. good

current as could Cirrus from differ Please Commission risk factors filings may we other refer corporate company Exchange to the or the results discussion that are press of Executive to John me otherwise. financial which X:XX of cause President PM expectations. results website make and including session, disclaims at of projections. Letter second Today, release, financial Shareholder directly us company, of Logic will non-GAAP Cirrus call this to Securities the Joining quarter revise call as our comparable information, Relations. Chelsea well providing obligation as discussing is Eastern. or announced developments results, other email this along Relations or for actual available information via projections are at Investor expressly whether to on the any today's the Logic's our statements submitted as that this The press on Please investor@cirrus.com. Investor at to available our This the session Chief a reconciliation uncertainties, any our approximately investor.cirrus.com. cause and actual results feature well during release Officer By information, we Vice risks may fiscal of materially as update Form and and questions additional Heffernan, XXXX forward-looking today, webcast earnings Forsyth, Shareholder questions note, subject Letter a GAAP financial website to the year that the at forward-looking that new company’s from the and statements from most differ made with projections the materially to result Q&A are all issued for and covering latest with the XX-K, analysts

Now, John. call turn over I'd to to like the

John Forsyth

Thank you, Thurman.

to Before make position Financial planning today's opportunity we dedication to the past his and to to that announcement Cirrus as like Thurman for commitment his from discuss on Thurman want I thank comments years. few this would take Officer. a our XX to outstanding results, Logic is over Chief I retire

and an operational growth our look will of through the to as team, extremely and he ensure momentum markets. All both success. identify innovation and many Logic to we continue Logic, this in addition a technologies that before all from of to of the and we like of work us wish company's course. Directors. knowledge a have help development role, next to organization, other a of at record industry, and a his to In the technical a remain during thank strong say recently company's chapter. quarter's his Raquib the current has here, us and I due conduct seamless Raquib to and results, deep believe, We successor his to successor, mixed-signal Cirrus world-class will news in the transition to very into semiconductor Board be track the to greatly finance appreciate tenure strategic XX-year contributions him his products of while new the nearly CFO. we excited sincerely Hussein will we and search to to in Thurman want the Cirrus welcomed in comprehensive get as I growth, expertise are would all valuable Thurman best to how expansion

to September in profit the quarter, highest and also XX% launches. second for part was Turning earnings of ever year-over-year delivering smartphone the record to components our the new and reported operating while year-over-year ahead up large of $XXX.X results customers ramping now, revenue Cirrus Revenue the share growth. Logic million, due quarter in per

the meaningfully also strategy of we’ve area that we progress quarter, diversify major of increasingly outlined a [ph] to These passing the made power camera mixed-signal the the included attach our smartphones, as on audio, milestones and business. our controllers we rate beyond conversion products in and During high-performance of new great of sampling did control business several just product bringing a significant XXXX, These technology charging year IC high-performance up fiscal mixed-signal represent with revenue XXX% new general to accomplishments market, and delivering products of and to total a mix, our fast market our customers. first Logic's in half from ago. expansion XX% Cirrus

website offer we for Shareholder Letter excited these on and future. further very be about the to published the the today, opportunities diversification growth in discussed continue we technologies our As new in

also we our begin do there our the our we ready questions. now note about intense to interest to in I to relationships. we're accordance like customer is business would understand with we largest not specifics take while Q&A, that Before discuss Operator, policy, related

Operator

from question of Matt comes first Ramsay of Cowen. Instructions] the line [Operator the And

now is open. line Your

Matt Ramsay

much, Thank everybody. you very good afternoon,

off, has First been going the work the you years to forward. congrats with best down all great and it Thurman

my kind would market kind semi two minimum then product the integration people you I thanks? integrated to would a could to within brain what between be your a two when company’s as we pick those efforts at the of For lines a now fully I what us you and on Lion look guess the product bit, if for might could be of the Can realistic closed. underway that and IC road acquiring map be from that have first and question technology sort your are ballpark and team of John, and bring together, timeline power think that wanted my congrats guess timeline of you to current you whole I company. the getting about Lion

John Forsyth

other to we and team really them expand Yeah, and into some that way is, about more Yeah, that. thank the across can build give possible, but rapidly as highly be try they ammunition out markets to of Lion map is that believe customers actually raft the talk I a new opportunities road of had want front is the have in Lion other goal this course complementary we significant integration because priority execute to first you we’re as that doing, help things and developed, them. pretty want team to Matt. of I'll on the to think technology explain we to the their of

those expand third of other then The synergies second that accelerate our and exploit to areas and business. technologies the priority continue priority is, road the map, the between and is

continue there because market that's rising they’re to, and in fast of that terms some running clearly ways expand still team So, smartphone right vendors, to has performance. within to now to has certain it, seen and a demands on lot extremely on Lion, that then interest the of expectations a go execute

but about then that we also that excited we're are that product there categories believe other can benefit So, that, technology. charging from

our just of of some Now, by we're synergies been increasingly all is them and way of we’ve we're an team that people saying the so, then front in the and bit, they initial we that, between really focus the have see excited of opportunities be down demand on. do working a to really, technology the doing of for that’s super execute, Lion there’s group amazing helping and we Lion up got other so road, that more further the there, IP of scale to so and it’s that

yet, that’s internally. haven't yeah, excited very we for we’re think laid out a timeline but something we're that I about

sits the to the of around battery, of charge value that, having what battery, the represents a focused can really that, part path more opportunity for our we’ve the deliver and around discharge so is to great IP course. customers that, simultaneously charge little both and we of you the path. a being Lion Just technology to to been clearly doing lot on give bit path discharge believe That products in really deliver able due the that then flavor silicone and innovate the the elsewhere, the in

its highly near is the addressing that the it’ll its, us to of opportunities the number converge in So, take term. team actually given a while complementary,

Matt Ramsay

appreciate there No, all I color really the John.

certain as you could suppliers or call maybe and guess to Cirrus nine guys months called next me there? maybe think for of and and on the, help six, notebook opportunities that been and letter business, I last consider it’s you your opportunistic investing well, the in some into, bottleneck strategic earnings grow how business the those our, quick that out market. a have been I over topical you into and follow that opportunities up months how XX, large the John have notebook in last on from As quantify the it's, the the Thanks. do you are XX be portions in may other codecs a six, all market

John Forsyth

letter I the when Yeah, meaningful the you little it, a to has a a which that factors Matt. well, strategic engagements, laptop there true that's to because and opportunistic some a supply occur, were strategic be us. there apart intended grow to underlying there in been of think was good once talked in are thank the disruption tease created revenue bit where also but The opportunistic the of situations of bit yeah to comments chain the actually nature reaction seeing was the which, in both. our, our And, about that, were for elements that there’s date, question we great clear

I shooting this tend we trackpads continue transition and continue we, were of technology, supply towards around happening is of or up are requirements once what with number without but and transition to there to want business, somewhere, that any to we growing our a difficult that related dislodge kind fairly we COVID using boosted amplifiers, reasons for a which will those chain to year were haptic a potentially towards think over underlying on those disruption. factors picked video, So, in originally, we’ve things codec the audio reasonable of build saw [ph] that, of amount we get be more especially we’ll once why customers

decent a grow. opportunity So, to us for, those represent continue for to

estimate but to per audio, we given looks total tend lines focused of which along market, the would, focused opportunities segments, on significant SAM. million is bit five to actually that’s devices we to that total high premium be over content on would would something the it it we be that device that those would like reflected play, tilt so see so very power ASP at, be be across us tend and in next end SAM notebook a segments and years $XXX Our on, that's performance haptics, the may that's, means of may in power of really of device, may that having efficiency and the it are pretty be it upper where the the the at for

Matt Ramsay

Thurman. very congrats John, Thanks much again

John Forsyth

Matt. Thanks

Operator

Next question is Stifel. Svanberg from the line Tore of of

is line Your open.

Tore Svanberg

to going you question this may Thurman, Yes, say and look earnings the thank miss at me and you you to last let echo congratulations call be your since first Thurman.

as So, to could is the elaborate How, going a for as on as, get extra the this and million a work you then capacity. return? out mean bit $XXX I payment what onetime far little securing is you payment in GlobalFoundries. it

Thurman Case

essentially, of that were mean foreword million the paid through it’ll of life contract. about and over two actually And and that’ll of million I commitment $XXX a there was XXXX. further reservation of history wafer out million prepayments there in reservation a supply then, be for last was pieces of that’ll Well, We capacity amortized fee, $XX the and the this. $XXX And, waivers.

how up. So, will goes show that that's

support for resulted option to more In million the which quarter, an to reservation more exercised during addition non-refundable and a capacity new $XX new of essentially prepayment. technology that million $XX the in a we technology

this agreement So, got more as not visibility in that of it associated option did decided and the visibility was and with to see investment revenues to, down be quite we, going see when way technology immediately. take we this of we part type something so the for we opportunities a this the isn't first to that the have loads this, will ways of you would by line,

Tore Svanberg

the drive signal John the color. this to beyond as to and point to nanometer Obviously, mentioned of performance follow trying much agreement. node. that And maybe a Great, does thank to related up related moving for you that? to, go high you're kind you that higher Is or to and this XX mix to that Thurman's

John Forsyth

we of Yeah, investment well has as going XX been would The and that no and right, making things I some time been is quite think nanometer to two Tore. separate you’re being pretty advanced. have those

across areas, kind additional of that technology and our related is that. be both It's us. the so made serve we really referring of we, business there relating related to technology those we XX-nanometer that. kind two. where. to So, enablement it we enablement high performance place fees to a will for isn’t high It's There that not believe something signal signal technology was would outside that for some of other audio, fees, cuts envisage mix mix additional in and performance XX-nanometer. global was area investment in with Thurman products which The That

As we’ve of for opportunities, should Thurman time got new says one SAM working we’re that expansion represent some a any at bunch on us.

One on it cutting landed, a for further were revenue of we we were and wasn't global, that opportunity during that diversification, working time of kind felt agreement significant something them it was with was would we the but but it we growth.

sight the activated ahead, for then it, that XX-nanometer of that's covered product in and that the So it, confidence that's by provided. more line previously on of we’ve recently more of a commentary in put given a provision ability go to got agreement execute our but much new and kind we we that area and then to obviously the win related opportunity, not in

Tore Svanberg

Great. that. for Thank you

Just mentioned rates one camera Any devices about one-for-one. of you in last sort as area. generation you new is expect the years. we or next be question. color the this every great? little a I there are more Should Could we of bit mean talking controller? would attach now talk And year, every two it like about

John Forsyth

you important total then end I've you products customers to that also patent for at reasonable the this rate really of solid talk again area, see we if it's top elsewhere at which look do, relation I lines a you safe of I four know at end, kind time. attach of which Yeah our look eight from mix to the given expectation that. date that drivers across very don't other that if probably cadence think the is you area, I we're There device say planning of performance content see of you the question thank that obviously investing we sure market are product think, bringing smartphones the Tore. in now company. around because and our some across going that’s but devices if based got of to performance solution one to we’ve plans, what on amount we’ve us, cycle I positive look whereby case what seen them, that the and camera camera of those evolution, for our what of signal products indicated really in across I’m the I we which updates, investment that in here. when through the are us. upper be just of most and is for very the a investment category map, but signal been fairly revenue this making. are then accelerated it rapid think now, go the mix four same product high growing would don't can in varies high the I seen can of for be functionality really has in really of it in innovation and we would in, over you period as good across a don't I we're then is products stabilize for increased time some part audio then products, road attach a what think and To The there some is mix know for products. a think while. innovations want on a we’ve been rate growth be And and but the them In about over fairly category a We on It has and risen, ground with and detail the the in

and in as So a the technology really, diversity. and grows view continue trend as path product diversity, diversify can. positive much it Obviously run as that the that really revenue from of that's we we want of long increased point the to driving

Tore Svanberg

Congratulations on great. the Sounds results.

John Forsyth

Tore. you, Thank

Operator

of of line Curtis the from Blayne question Barclays. Next

is line Your open.

Blayne Curtis

taking first Thurman. my to Thanks congrats you I wanted as well my ask. I for just question. Maybe offer to

at $XX look about it's customer, the up you million If largest bucks. your revenue outside

I post of pieces Lion. about was kind think talking have were you came customer the that you I'm moving for the at outside look now. I largest acquisition. that's of around in your of kind curious a that that just level lot how you And as curious just bucket,

there of handset lot think be there year. a Android little a weaker at the of thoughts market I the end that is the the might – handheld

if and largest are people you those these perspective prior been just would but of like softer, into all wins, wonder as I balance opportunities. for the know short, be that looking customer, got some the look might any PCs, you think as the new so to you’ve very and all helpful? someone little has things I year have audio tablets then fiscal your could call outside I the end and codec be in

John Forsyth

Yeah on. thank the would it uncertainty an most quarter there. current look say long momentum. you the year. fiscal between to We’ve and year is there it Blayne. now, Obviously the of of at when lot got awful the I great March, we and we a feels feels I so biggest this design end most thing time weighing mean guide

Android, and on The in have we’ve I diverse our still and relationships we’re parts weighing stronger, factor constrained. the competitively other than really biggest outside so smartphones recent business think had is supply, years. across areas of more we of those

point very a Android strong demand lot past elsewhere a time we’ve view, more with position We're on erratic. the work from customers where been has think over I we lot a the that supply year a but in horizon. of commented of long a

faster on grow the could much making we we universal that's sure supply, wafer of focused right but and grow service very those could challenge can we're the upper So end the now. business market kind probably sockets, of the there fairly a if

Blayne Curtis

and any ask, their about is seasonality and in seasonality, constraints kind constraints. How ship you can Thanks kind a to talk can largest but and harder then also they’ve curious, impacting look talking of the to Kind in Are maybe a up, that as way there just different you their does just your one customer of about any was are prohibiting of product. you follow of translate what been then maybe shipments quarter December. that for March? you

John Forsyth

that's I on think Blayne. category question I on our be the the very with that’s tend this it collaborative business term Right seasonality an a customer. comes we to actually constraints great of I focused to, just the say would falls into own our when area of planning referred long kind to where that

been and lot end the of very production in generally against pretty we’ve the ramps in obviously good with typically we’ve position volume seeing, that the got we’ve challenges This the Where been not we’ve year. any So the as through past. in a has being planning execute areas is to been phenomenal some a different it of sort horizons it's encountered really of in from way so, said. the our year I’ve

would even we’ve that's that that servicing of gets guidance been. Regarding demand scheduled, there say because maps We point how to the onto strong of see where challenging demand, but very is for seasonality, being how here. the volatility, and us I that

given has our to stood rescheduling planning of one major other pretty comments, you really in of any present also in with long the much as rescheduling Those some quarter calls quarter agreements A of week is gating, who but of would chain some and term suppliers is can you’ve small but subject supply quarter the it just at if what fact us next term constraints our heard consistent the supply excellent amount or strong across our last a as level, material appear, are consequence present That long are our with Our first earnings have in the mean investment constrained. a that demand week. quarter couple stead this the one In chain who up are capacity our it the there have present customer, like in that impact, material the the boundary the can that. so during that depend one, customers. is a but certainly to be on there the would so year. for like are with mean teeing does customers planning on

have at So lines quarter we're been have we’ve amount well, I are obviously customers guiding our impact that so you're getting been get maximize something the to think of far as actually the that, the signals but what first material during that that very can keen they not getting of calendar so of an along that there.

Operator

from Next SIG. of of line question the Rolland Christopher

Your line is open.

Christopher Rolland

I congrats enjoyed and Thanks working for guys Thurman. with the question really you.

guess now the products Lion. business, have that forward, we organic that So for we perhaps think about about a you that growth quarterly power and talk integrated or rate a power growth your contribution also as you you I should well? see, going Can guys conversely but expect might rate

John Forsyth

Yeah you. thank

for We specifically areas. broken out growth rate haven't those

of I million way growth to line and the of of on what They were, during a quarterly they year $XX the the we're got until I look and be right to power basis last our pretty the much part tracking business fiscal rate we rate of base, been customer think given fiscal business in a we path. breaking over and think not with meteoric think so talked one from were, few months that it were The remainder themselves products necessarily expected, of had in contribution end. believe next now the growth on individual that about close planet. if a rate. order about year on certainly we're our excited within was the contribution to of something about the to we’ve deal that zero talked and think out or this we're happen with lot relatively would that, now year, a one-to-one still with frankly I we it's date, what momentum completely would out two about can steep the best time even of We rest that a this they they ago, attach growth and Lion

the pretty contribution first and help going us. in a long we as really what but and have vehicles just for say and is I of So, of is term we to things which investing really big I tangible areas the a talking also proven stabilize into would couple One well technology about But obviously accomplish ideas, step to bit, we’ve IP, direction we diversifying a think business really the that there, and represents test we're leadership expertise, as is is today. been that's that grow the to kind see really a of of that I of that. obviously and want revenue continued things series in that of meaningfully there where well-stocked step a think the that pipeline whole that can

So it. it putting much of on number --I'm not a

to our where comments You'll see take in medium that us excited about term. be that the able from can we're very

Christopher Rolland

devices? products broaden devices guess into for Can your around and some other opportunities possibility but captured tablets, this well. in I talk as Okay be tying new including things whether into or also of they product, you that phones to well of today and about power perhaps as some laptops, have kind or you the cameras, these

John Forsyth

absolutely. Yeah

focused the in signal the seen high about of in mix areas right talk on at a particular attach growth which so business look performance smartphones you rate. our camera constitute side. in a you We’ve now. lot those Obviously when So that's

to related. that I elsewhere. kind doing that about we're cameras. think contain doing what stabilization what that products and talked of focus we're Obviously is is applicable other there We highly

our So is that's it the that power typically find other launched reach of during rather to conversion, space be ways quarter smartphone. a so the that products. the launched like IC that control the than In recently one certainly that, power of technology we and moves we expanding around in would into camera flagship somewhere, fixed would

a on on to So foremost, now that that's continuing and clear serving priority very we're area that biggest one on of in a this silicone from team, those first everything kind seeing is we’re one pair Right and but we team investment it's of number making focused and customer obviously, custom are our also of we device. on the so lot and And for the can can around places would certainly execute you opportunity as land of expand and as to innovative I and to certainly be our we certainly that great some believe think we that really mentioned business. such think other seek so broaden, represents and be battery, that you can tablets, the devices well. some technology laptops, of

Christopher Rolland

Thanks Thurman again. again and congrats

John Forsyth

you. Thank

Operator

Next Loop line is of the from Markets. question Baruah of Ananda Capital

Your open. line is

Ananda Baruah

a I clarification I Letter the of in the there get accelerating as well? and questions. or of may up as a you guys, could, in thanks end but laptops afternoon are a on strong quick base if for Hey, through comment we ahead as that is is seeing guys have to about the then Shareholder the the would being follow-up taking Congrats good few and spoke results when Thurman accelerating that fall general I congrats well. what love you one a sort context here your objectives, go Certainly

John Forsyth

as in Thank satellite-based into you like to look space what communicating engage all opportunity are there they to what see Ananda a a business, our boosted emerging on sell and architecture amplifiers in than principally have of thinner. from getting specifically customers some devices devices. HDA that that to in growth already we smartphones going customer business to based out focused thinner Those are those architecture and They the they an relate past. regards had we more that we comment to laptop set the means in were are when architecturally of lot we moving outside our largest an is where the we're laptop

a And us. so very it's close adjacency for

objectives got that’s that there have those and go smartphones We that lie a that there. they so trackpads well responded had amplifiers a very huge strategic interest as plan engaging us in also in formulated established refer to we started just It and boosted we're then were really market to supplying we more happens but accelerated after to to we enthusiastically some really investment leadership haptic with keen very that in fact get customers we expecting. where codecs

there positive pieces sense anticipating in there what initially moving then that's and we're more So we a were were communicating.

quickly devices a we come and designed largest moving of for Cirrus see OEMs over into the it's to category next containing expect new fairly the we're So being to four year. point as content steady to in Logic five that of where us market out of the today stream notebook

Ananda Baruah

and become that something meaningful time, could fairly great That's over that you are it incremental you seeing? believe is is

John Forsyth

I as a addition. be it's it solid would put going to really definitely

potential the have I'll revenue a think it's audio area we overall and phones. to be solid can our technology for an in really where smart to we've investment leverage really I addition the that made

magnitude see terms be and In significant is battery we around of more the to us charging making going investment long-term. opportunity we're and space for the the that power and

Ananda Baruah

so expansion it should appreciate remind us margin in be, a operating calibrate quickly handful you it? we then and my asking that's coming years me and of years for we follow-up this expectations next directionally, not margin, expectation over and some is but look our just what just I out expect guidance all anecdotally when just can margin should can we for gross the Understood and the are is for

John Forsyth

our target customers. order innovation that is is in target that important kind of fund really margin margin. and to XX% We So model the to the our we bring gross level R&D is gross believe

to as to we for products we better So continue that new shoot market. or bring

require but of any that it communicated may we're the Lion the really gross door that today not well I expectations. economics the reach anything diversity around we market of being other in think lot think organically the we making expansion in and really market clear been I so think to I high-performance space of open have able been the and more than we've into the categories and But product our mixed-signal will we anything that a broaden that are to markets stepping have well a term that communicated pretty important investment and so margin acquisition to given have that through of longer on I elsewhere both that that established about potential haven't pretty understood. stones

Operator

Next of question Gill line of is Rajvindra from the Needham.

open. is line Your

Rajvindra Gill

lower and best strong just of my congrats the if execution a of on to start very in a you earnings of year to last light on and pressure. expected the kind I thank gross that previous the call pricing XXXX are congratulations you the question. margin in mentioned Thurman lower Thurman, with echo environment Yes, to in follow-up stable fiscal the luck. remain could but just near-term you on slightly gross margins I In of kind

of commentary understand just your get kind a lot experiencing existing fiscal the for to dynamic? semiconductors year that’s of pricing on components wanted across increases wanted price view are and to on constraints an that obviously the So so update XXXX broadly just given

John Forsyth

Yeah I'm in there. on going to step that

market overall I I about were environment. think Rick saying and the

to that Obviously, for on and year pretty updates the our and calendar this our required gross unique of our and really is price I through world-class new execution chain of on of Clearly for during and we year. to goal and we the to think have that. margins the see engineering customers the that’s our cost into go working solid cost increases got products some seen we through and to require supply customers have customers. innovation investment areas both kind us support offset chain side as depend cost hard for understand increase deliver across a We further as supply those we’ll increased number

team closely margins. both across to cost our on all impacts increases minimize in the our those very customers entire and chain to focused base our working of supply today gross order across is So, our

So, that relationships with the to has with we be our cultivate balanced little customers. a that deep long-term build really and fact

we're the gross have preserving the to So, that on for out margin cost of go the laid we an have and customers. us those way cost business. and that's to together the the model to don't felt that The the model of continue below on long-term focused fair target together, with bit to and what health important of because margin appropriate to can we we a you our preserves around very our lead we relationship we’ll target we do believe go, pricing managing volatility margins we the they sink may dip updates in it’s reasonable that's XXXX we to but gross and way to necessarily that it business the that in the seek perfectly pricing all and that take increases is and picking the likely things work all but gross obviously customers a one consistent ensure when offset was FY that the and with we're signal with one with

Rajvindra Gill

with getting a yeah deal going follow-up prepayments but enabling the I'm the great supply growth that comfortable you components gotten going into your that that know feel that well. getting are situation wearables and balance the to is trying you're you to is you like near-term you that relative support into well GS as amount the and you've different tablets how ability from Lion Okay, you with just Are capacity these made wafers. on for growth GS as but you the made capacity getting wondering the some you have the that GlobalFoundries that that thanks about your rate to other areas expand year, your thank additions as the The of to for impact for you're cutting prepayments XXXX? just for information next customer that to capacity calendar the top and of capacity that in from wafers,

John Forsyth

calendar globals yet. coming some on with additional it expect of XXXX the in of that the the that place kind we will where yes, as capacity really In making year partnerships This of the onstream more investments back capacity be the be we a during will, of put is course hasn’t case consequence of that of calendar expanded the them. XXXX with

our ourselves wafers, supportive their good more a expand could and greater wafers that So, in could same of absolutely. time calendar more get relative sell we're if customers faster, we if planning capacity next biggest sell virtue more long-term serve we by at could of able year But to the absolutely yes, and global amount next we where during larger to position we have quite of supports year meaningfully supply we're through business wafer a that growth. deal of this putting number that be year would healthy could a

areas capacity I there be to spot good we're to until business exist in the yeah Now but more rapidly supply point to expand. expand relative could your the that industry of more we're in able a may if that actual think to get our which starts

Operator

you. Thank

Next the question Company. line is Benchmark of the from of David Williams

Your line open. is

David Williams

to thanks for Hey, quarter on and letting question a congrats congratulations Thurman me a there. ask and

earlier, you perspective quickly your want that's the ask maybe available there constraints selling management margin think maybe talked on mix part any mixed to benefiting you? from the you a have products limit So, you just of about management from to is if about basis as

John Forsyth

largest the bulk by the our of in terms driven be to customer’s of Well, products. revenue our value our of by unit are share products going of overall sales

is in our possible. getting to that. have really We're as terms the focused supporting devices customer humanly of on mix as many of So, we play a don't role managing just

margin obtain been pricing comparatively where drive of other and small parts for high increases to returns revenue and those adjust of volume able but amounts our on capacity that's fairly business us. and we have small The devices

getting The of much on of where in our up. the for So, as the capacity bulk doesn't our it really customers things for thing most us because move revenue of us. can largest that’s scheme is products overall tied the we the important as is needle focused really

David Williams

of maybe way and that had customer you to are you thanks as of and is you be kind think that about diversification mix at Lion Sure, have, as may coming you two terms how in of may about for your be do you think versus qualify there on customers? a a year the products in or the look where diversity today it your diversification

John Forsyth

great a That's question.

business revenue think growing customer having business truly with notebook OEMs went of two much I three products the we progress been five additional to I all in now of elsewhere have of five products the extent. fact to wherein in the base the diversity the around those can with in of products a the were have Lion in wireless of three where design because largest alluded part this tablet from to OEMs successful selling OEMs terms out that making is out earlier story so engage that leverage that a with customers. acquisition. out the top to can their and a we it we kind prior four our and new and close multiple Lion top us of to brings overshadow we standing the call start increase to largest both some certainly

we're So, within we I as think that very is and signal there path story that one well. growth mixed reach grow general which is a the more market there a high-performance audio as drive to will on continue and encouraging beyond

Operator

you. Thank

is question BofA Arya of Securities. Vivek Next line the from of

Your open. line is

Vivek Arya

from what to over John one Thurman tablet right taking for where you market your can non-smartphone sales wishes years? question as are and one my now best the the do two next they had my to Thanks first side questions, to well. think from two I and head

John Forsyth

relative break tablets? contribution. the small don't smartphone it's part comparatively out asking that small but That's yeah we comparatively so Yeah, to specifically our you healthy of business Vivek are to relative

Vivek Arya

balance model need $XXX will a And cash cash like there so for going for the forward? my range one that cash, Is the you the the still is second December levels but and strong, at I is at your payment quarter be and of to takes million etc. right. as under if sheet exiting puts would is any comfortable for look foundry we any when financing operate higher to if the you, since helpful very be typically balance model

Thurman Case

quarter's be the comfortable. we're then, the cash our that did reflected We deal. that above, or with see will also included run and an numbers last with basically, area long time, as and operations is op, well, that say GlobalFoundries as Sure, of a period we operations at the where deal our level drop, Lion to our that in million $XXX quarter our manage would we're this over

much So, at moving on road fine, the move business but right through a financing won't we need some building highest really, year. things financing generation we we this you're for and you’ll draw now our if start running need quarter time, see M&A see cash, towards go back of of any to as cash fiscal year, so our us or but end you’ll have March we point the going the may have we this the end for are us of up in and we no quarter strong revolver have the go December not we're that, or the the it, see really down flow, like we that for

Vivek Arya

much. very Thanks

Operator

of Next Securities. from question Colliers Derrick Soderberg of the line is

Your line is now open.

Derrick Soderberg

well Hi results the guys, my congrats as you to on and well as Thurman.

elsewhere. on, things it to for there’s relates that. one that there been this opportunity digital of question and lot curious about movement you’d be of John, I'm Cirrus we how and new to like timeline Potentially on your on to haptics, opportunity talk things anything sort for body hit if a there suites like metaverse might like opportunities is products that’d when those there, haptics you're great? me world. or full about be Just thinking as maybe Thanks. opportunities should haptics I’d for haptic and be if in investing for these for curious comment lately

John Forsyth

thank really you interesting question. Derrick, that's a Yeah,

unit the being think VR who expectations a market of AR actively so, great track on are, engagement our there, have into that the with but wise commented been I a we engaged and are of folks and in elsewhere, this lot that’s modest are are think we’ve of I it trails equipment record we today. the most designed very blazing area

wearing as from and I’m time to also the a, the and those other to example, customers objects make We it a I about, but, certain audio could all believer I haptic a haptics think for a Really have virtual as term to both talk haptics long take suits bet, haptic big before real. areas. perspective, potential we're a continue long think

like seem kind play it in has that experience. does to that, really in role of particular it a user So,

technology around cool have some very haptics. we So,

keep a interesting it's the to, expectations are focused have we we it's engagement think our feel think that certain right an I customer relationships, on. there, a long investment one of amount road but that to I

Operator

question line Instructions] of is Ramsay Cowen. from [Operator Matt the Next of

is line Your open.

Matt Ramsay

Hopefully, jump that guys very a back do me you a but much up. quick letting get for something about. I asked one, follow it's it's for Thank

of at on the on foundry there’s fiscal reiterated industry then quarters, going GF the same gross think investor that the bit the integration talked wanted of dip but of this wanted So, worry all deal about in last and of there’s the for you XXXX. Lion. just is there’s that of three I ask just gross to XX% clarify? very And, couple I might there little guys call, the wafers I there don't you to it's just kind of much. in things have some guys you to you you just that about Thank talked target, those. margin right, margin I last sort be new guys’ is, drop. shoe targets might three below time prices, explicitly base the over there’s it are based raising But, broad doing, the a if guess incorporate and another

John Forsyth

as you a is, I Matt. of quarter, we Right, so though identical you think during that got couple cards and over thank the what Yeah, pretty that quarter turned to provided much out commentary last period. reiterated more this even we point

around year. the environment we're margin varies, coming this So, can about the everything we the, we and about embraces we current think know see point messaging everything at fully what fiscal and it gross what

perspective, a you obviously crazy but to all So, from say there XXXX our year to. shoe really feels hey, just from everything we drop, that like and our embracing perspective information to no the we're if other have alluded there’s includes

just me that I to don't clarify. I answers need I yes, think that, your let question So, think but check

Matt Ramsay

No, thank John you. very that clear

John Forsyth

right. All

Operator

of SIG. Instructions] [Operator line Christopher Next from the you Rolland Thank of question

Your line is open.

Christopher Rolland

do integration. this and to you've up been the we kind have for you products OpEx like of My a plus can have OpEx supporting is in question for of a it spending a kind there OpEx, seems could nice up. the forward, think here, that this while you Lion going that Are on done least there your like target this, maintain we a OEMs level spending? be and the recently had or ramping It guys is beat above good catch Thanks at some for guide guys follow new quarter. for reason better believe with, here OpEx we looks to of next lot with higher a

Thurman Case

a that R&D, we we’ll products on about be will that, meeting think touched invest already. technologies and will bit to I focused in it that talked on continue and I in R&D particular think about to and that or continue or to want invest has we’ve customers talk the John Oh, in

in if as and this up at those funding right that a for quarter. lot it's QX a around of see quarter, and to flattish for QX, is But So, March you the taxes the that quarter. the the to going we're give things you look guidance health us look happen payroll you heads only last would and that we

lesser you we line, can a revenue operating to expense. that will uptick there think of our the as do have grow SG&A in and percentage you expect allow we leverage future expect us to leverage we’ll can overall What place is we invest So, R&D. we continue the become our in can that and in infrastructure an that

John Forsyth

to with Thurman, Chris. bit, add just a a I jump you quick Thank there term will a add longer a of additional color maybe bit in comment

this want our OpEx. this on think my strategic we I really is, about, about or to take on take our, be

raft see continue By we to those and the think as, so quarter’s other And messaging. that's as that every opportunities we as the you’ll best accelerate the front quite of look when related as So, was do opportunities great team, in us. in from SG&A thing attack perspective go Lion we OpEx, our engineering. see it’s operating to Almost are believe of to go, of a us, ahead areas business, the Thurman for we I in can, where said, to that and favorable right should power go really contrast, you the forward. especially grow rise side be from previous power at, leverage I see revenues, to margins the quarter relative increased of on grow we’ll heads significantly one to headcount as as single those the number the last

Operator

now the for continue. Please call Thank you. will remarks. additional And, I Chelsea Heffernan turn to over

Chelsea Heffernan

today, back operator. further turn so the There John. no you, Thank will are I call questions to

John Forsyth

share investor expect delivered of initiatives X. that website addressed and as the conference you, Barclays products and of really that mixed us Thank numerous note, some that key the strengthen I’d revenue on a opportunities high will we innovative the and In record any a per investor on continue major of revenue the rich and website. excited to if as signal will for Ask today, to strategic by our for today, forward. position to we be the December in portfolio check the have earnings section quarter, summary, the our details With for ramped a submit we can that. milestones our new Chelsea. you September solutions, not of like we're in drive participating future. front shipments in were questions also Please in go devices leading performance roadmap the us you And profitability growth supplier we to of them that via passed CEO

to in today's like call. Goodbye. thank for I’d Finally, participating everyone

Operator

participating. you for Thank you today's and conference. that everyone concludes Thank

all now You disconnect. may

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