SYNA - Earnings call 2 2024 | Synaptics Incorporated

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Operator

Good day, and thank you for standing by. Welcome to the Synaptics Inc.

Second Quarter Fiscal Year 2024 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.I would now like to hand the conference over to your speaker today, Munjal Shah, Vice President, Investor Relations.

Munjal Shah

Thank you, Josh. you XXXX us conference thank second on and fiscal quarter call. afternoon, for today joining Synaptics' Good My name is Investor Relations. Munjal Shah, and I'm Head of CEO; With Hurlston, CFO. call today's and and me our Dean are Butler, on President Michael call be from company's can website This web synaptics.com. of Relations accessed being over the broadcast the is and section at Investor the live

management non-GAAP Investor acquisition-related addition items. will the closed we accessed excludes issued Synaptics company's the these be that prepared of will make a to section a results, posted copy from this release the the to statements. on course Investor and results a In supplementary to certain or share-based call, to the on provide like today supplemental non-cash during Relations synaptics.com.Additionally, our which a market have GAAP at which non-recurring press the addition company's website slide of recurring Relations refer or can results, costs, presentation, detailed after we basis, you other for website.In remarks remind Please of would non-GAAP GAAP reconciliation and compensation, forward-looking of conference

give our financial results performance and operations, projections current relating condition, future to and plans, our objectives, expectations of business. statements Forward-looking

report the for actual risk report any turn obligation reports recent over differ on factors SEC, that Michael. the disclaims to company's estimates this prove information.I differ Form be expressly periodic you update forward-looking on to from be from call of results subject Synaptics any XX-K to inaccurate. contained We materially risks company's to refer Although most forward-looking with cause those cautions filed in and statement. a materially assumptions forward-looking Synaptics may in reasonable, the Synaptics quarterly important believes actual current number control to and now future our could and our our to they the may results will XX-Q and statements. are performance Form uncertainties any suggested to that annual and beyond including

Michael Hurlston

welcome were with to period call. the these about achievement demand and took to to Thanks, uncertainty, that in Munjal. a today's of in We delivered line like accumulation industry-wide by recognized an inventory. earnings to overall Synaptics issues I'd reduced marked actions everybody and align expectations, market year a a environment. ago small largely ourselves

line While top products. revenue, use our we in ourselves to IoT downturn the that to the resulted significantly future by in intend for position investing lower Core

now path in sustained can we in fact, a wireless. to see growth In IoT, particularly Core

from our foresee believe and at to cycle not continue the further we're do forward. of bottom We decreases this point

the shape slightly and flat compared the revenue the However, was remains to quarter, X above recovery timing months. the our guidance range December of to prior midpoint and uncertain.Turning the of

guidance an by of at Our midpoint gross despite mobile product margins headlined better were mix, our than performing initially forecast. the unfavorable

spending we've Our toward non-GAAP inventory range.For working in chain. resulting was quarters, consciously the our expected, supply been throughout few EPS guidance down lower of end the past originally the than we high

very or mobile in wireless levels at areas, our a result, and historic near stocking As are PC, norms. product

to enterprise, other the moving in expected. some where On than still are hand, work slower we have do inventories

March sequential see guidance. area wireless, growth investments docking slowdown signs fall, we products. We impacted our of which last our first focusing contains normalization outlined IT and seeing expect reflected starting in telephony We're with attribute the has higher-margin enterprise we IoT, revenue nearly to inventory. We in to stations, continue headsets.As areas such which in Core wireless in high-end this consistent spending, business to now of the and as are a our enterprise of the in growth wireless our XX% processor channel success with our

increased coming both feature customer are enable While use of and own cases.Our to is we had our engines, both measurable shipments AI deploy bolstered low-end road general-purpose off design but CES and which longer should engagement will be new computer we first around to success, driven their which a levels higher-end where processors MCUs a to resumption wireless existing customers be to by success customers a further of vision normal wins. by MPUs, a inventory return

module begun lead infotainment our example, For automotive shipping partner for wireless our first win systems. in-car has design

as and products, IoT for initially into see While than engagements perhaps we an Core hesitant automotive more customer getting pulled thought. about market we're opportunity end

to device device, continues XxX enjoying audio appliances, consumer for security success wins funnel first and in high-performance sales new is quarter the new wireless initial cost-effective, our front, have security on both We first our remain to modules our XXXX. home for smart equipment, products broad X we the IoT the the action product increase, XXXXX, in Wi-Fi Our by and high-performance and and chip fourth speakers, cameras. market industrial applications of track sample qualified cameras.On

on discussed announced they In call, quantities processors, platform. product us ramped we and are Astra second IoT addition, taking partner, our begun already their the one and shipping module pre-production have recently have we to that from Core last we customers.In our

Astra, a frameworks The IoT platform to commonly ranging offers embedded in adoption with rather particularly running the encompasses full-featured used octa-core developers' It family customers center. partners network of also deploy AI IoT at to want At the data customer intent in to interest MPUs. that of a use than in simplify in from devices. tremendous Astra on relying CES, designed speed was processors various AI products. from integration MCUs to and simple the software high-end the cases models toolkit, there edge AI accepts

core customer applications conferencing. Near those spending. expect our to XXXX.As and inventory enterprise industrial are video wins our and as our embedded appliances, into characterized year weaker-than-expected products largely term, we by revenue extending our seeing traction processor to in and earlier, beyond and are been IT such space, We processing deeply reach operator fiscal have products traditional in translate our stated persistent customers

demand. fingerprint compose In that different with devices through customer two client are believe shipping worked enterprise, end and channel for are discussion. we have further PCs, of we and at products historic look inventories on and As touchpad worthy the we par our

has PC X-year normalized, notebook increases of yet materialize. refresh predicted optimism second year. growth is some has the both in the There market calendar COVID driving market the While PCs and half a AI around to

technology. anything on of yet by that indicate to control particularly but have can to user at area We touch market.The is strong presence resurgence share, see driving end second we would continue the to high our detection what the

Some of ease of you this its at action power and see for in to privacy and CES able were savings. potential use,

at of our current our latest both this power penetrate for to deliver algorithms chip algorithms, to which designed differentiated is extremely low our With AI tuned at device of set set additional suite are to drive customer, and increase touch application, specifically the levels. PC first expect transition application DDICs and lead legacy to We the drive we sharper share legacy initially but accessory Adoption from solutions seeing as than plays DDIC and OEMs, tailwind, of devices.Automotive into products products forecast. we're the well a in TDDI-based is discrete fall-off continuing out. reasonably are do TDDI a to still the

the will next curves over choppy Our of in couple as be cross likely quarters. aggregate the automotive revenue X

Porsche. multiple do with our recently OEMs, to and TDDI well at at Toyota continue including won having new models We products,

delivering mobile to central our while new additional strategy, TDDI design strong SXX. customer products the Galaxy the our differentiation early improved base, giving of design defend and Samsung quarter, a cost across automotive as demand the in as position.Our our our by had also our for new system us is SmartBridge second the portfolio, driven adding helping product Although savings, cycle, product well to Chinese ramp a win

leadership our the position for win, high-end With in solidified the touch handset GSXX market. Android we controllers

we displays into look higher that high looking Customers signal-to-noise are our future, new which precision As circuits to the to end. can introduce even thinner, see differentiation we ratios, the our are maintain resolve. analog opportunities at driving

quarter, in has our areas end our and now we are In demand.As and seeing our some stabilize. as has inventories handsets large at we business we track believe bottom shipments cleared, to a cycle our addition, and we our outside the businesses hit gaming. extent, state. said steady for to believe near In general, the align To opportunities normalized, inventory and last market or such continues are of of we have products mobile expect touch

turn good However, our Near and before term, targets. news a our to line the quarter at nearly impediment a Day new led we're higher-margin line, and see top products, growth significantly our still over was our our sustained will forward. long-term review below Dean product it been targets has in state to which overall keeping outlined XX% this growth. our and confident presents outlook we the outlined spending third in second and quarter-on-quarter should margins business, wireless we to financial Analyst reduced, story will me Overall, point takes of sustained let automotive which tracks by to September.Now, our show from The increase steady IoT revenue results Core enterprise enterprise puts for call flat and in returns and quarter

Dean Butler

distribution stabilize slightly channel the for restocking stock the and see XX% was sequentially which our and we business midpoint current roughly down continued new inventory turns, to our Michael, recently was provide XX% IoT, continue XX%, the the automotive, high was our although enterprise Thanks, results I review decline products beginning and from other was afternoon of revenue quarter Year-over-year, financial our and will inventory first flat sequentially.On Revenue XX%, quarter are continue million, a Core quarter, revenue everyone. December and guidance. then above slower outlook. IoT XX%, some importantly, basis, year-over-year. good for consolidated were experience mobile completed to respectively. quarter but $XXX products and to orders.Core the while quarter prior Revenue down December in consolidated to and to more

quarters, year-over-year. down possible point quarter we December we growth the can XX% quarter the worked to reaching X in third we revenue to sequentially where our inventories tirelessly XXXX.In enterprise and excess automotive, last to are and deplete and Over down return fiscal XX% where finally expect was have believe

products, many began to of some slowdown one enterprise in This XX% strongest may Core believe quarters after mobile sequentially sequential X December require began marks increases declines that our X leads to the Here, was patience.Mobile XX% us year-over-year. their up experiencing our product additional in XXXX. and we since customers revenue up IoT fiscal quarter quarterly which the

in strong ecosystem flagship new if well strength or China, channel end experiencing At whether unclear Year. Android are restocking due the Chinese to as market across the it's strength smartphones. is from ramps this it's the of merely as point, demand New ahead We fundamentally

subject continue mobile normal approximately expect patterns.During customers We quarter, to XX% we revenue sales of greater than had seasonality to X at to XX% remain XX. our the and

in non-GAAP quarter XX%, compensation gross XX.X%, range. December the December $X.X December and our $XX.X intangible quarter was million. quarter, the share-based million guidance operating preceding GAAP quarter $XX gross of of December million were amortization of and which the was million guidance quarter of $XXX.X $XX.X down our which margin operating includes million non-GAAP million margin $X.X compensation our midpoint was of was For expenses expense share-based amortization asset of includes intangible which from range.GAAP million, $X.X below the asset costs. and

Ending GAAP We likely the expectations will December of level was continue quarter, than a non-GAAP were ago. end the from operating on increase. to was operations $XXX quarter sequential prior GAAP or flow was that $XX $X.X year cautiously given and and an days increase sales to recorded and was million we December million, our of $X sheet, hand, to rate $XX of our per quarter.During sales basic loss December loss expected, quarter benefit return of Capital our our tax inventory net XX% And inventory million, turning continue tax a with an of of maintained million. million, the the million net quarter from same net of expense.December a million. maintain benefiting expense $X.X from range.Now balance and X% $XXX.X million $X.XX in income reflects quarter short-term high purchases. the we at days bonus a quarter of from Receivables earnings Non-GAAP previously were the $X.XX guidance quarter for vigilant a diluted X a cash, increase in ended a XX% take program expected $XXX.X investments depreciation were our million XX the the $XX.X per control. reduce million was reversal Non-GAAP expenditures the $XX.X decrease quarter. the now balance share and was Cash longer equivalents cash XX% we more end near expense normal or down as cash last days, to million share. outstanding $X.X of of GAAP

XX the balance on March compared end of declined the to outlook. Our quarter.Now, prior quarter at to me calculated of sheet turn our let XXX inventory to also days our

the to slow current given corporate and We inventories, are products, IT at the enterprise-focused distributor plan levels in spending. seeing stabilization further particularly reduce

lack rates, While quarter remains hopeful expected a continue of to expect return March to for to customer fully we million, run quarter. automotive to have our to we coming into and bottomed consolidated be have not XX% decline uncertain. and Inventory quarter. December of At Core in the quarter. revenue believe the products due and of the revenue a the $XXX $XXX and recovery normalized March the sequentially. to yet to in up the timing we to range remain Enterprise similar and in March shape more of seasonality largely quarter IoT be the million decline products, the we is level, to higher bottomed will appears ramps nearly anticipate Mobile and

dynamics, mix from in March March and our expect mobile GAAP respectively.We these gross quarter range the automotive, of Given the Core XX%, XX.X%. expect be to in XX.X% XX% we be the enterprise to XX%, and in margin approximately revenue quarter to IoT, products and

share-based GAAP amortization expect range $XXX March million, We non-GAAP improvement quarter.We from small December in of margin to in of operating intangibles XX% quarter to the includes a expect gross be range in to million the the the $XXX which and expenses compensation. XX%,

the the diluted range million the $XX in of March in to our shares. net diluted an to $X.XX be of in income expected million the March non-GAAP to quarter to loss share, of net share for $X.XX expect per to $X.XX, and to be non-GAAP quarter per in estimated basic million.GAAP on $XX range range share expense per be $X.XX fully operating is We is anticipated XX

remarks. GAAP session. Operator? to now wraps up call to quarter.This over and net turn operator the approximately our start interest I'd non-GAAP expect Q&A We $X to million expense prepared both March the the be in the to like

Operator

[Operator & comes Instructions] from Our first Bolton question Needham with Company. Quinn

Quinn Bolton

some million businesses, all level? my ship here under-shipping that guess, come levels, currently think your all get product return as much next for consumption over of you'll by think end segment consumption? million process. $XXX in with of you to a you're think I Or related of segment to segments, consumption the where shipping of does you reached a across imply your guess and question Thanks quarter look growth million, question, by, in $XXX down detailed just And I of roughly on the think I as have to revenue you at normalized do sense are say, rates inventory question you sort you quarter number $XXX a the terms as a a you still in in sort first the of you line is, consumption? of, back quarters trying you number start you're with in said end shipping you've line inventory kind consumption. of to guess at is, do

Dean Butler

and good Quinn, I'll in there's Yes. probably the on. under-shipping -- bag and general, we're it's different overall Michael add overall, take actually Look, stab product think, a would groups. consumption. I I question, still let mixed a to say, across

the differs it across groups. different However,

portion a been quarter is lot pockets that This large There's March Core IT. Guiding of individual with X within like depleted really working now. straight quarter even that. quarters. for looks plagued we've It For example, fourth still of the IoT Core was within inventory. up. into We've products a our

and largely resolved. is of kind For inventory that PC-related example, mobile customers, in

demand. end we're just shipping to Now back

probably at may near helps, at certainly has of rapid and least probably little fundamentally PCs in think sort that is As recent up a inventory just I any like -- of there, I then Quinn. hope most the unlikely it corporate in the strength, shifted pace. which given down, choppy, seeing point, sort to come spending there's know, more mobile it's looks We're enterprise, IT you demand term, But back in is still and be unclear this is under-shipping. the channel.

Quinn Bolton

Yes, it does.

Michael Hurlston

add ahead, lot have I to Go Dean what don't to Quinn. a said.

Quinn Bolton

sounds about spending the I softened demand the on should the of enterprise. slow as It as environment revenue just, rate that sort going it. sounds It be the we the guess, prior we sort thoughts $XXX especially a has things, it like run sounds way think inventory where enterprise to was probably corporate we like, environment, that about given side just you by finally might be as may temper macro I may if like of to normalize with demand in of ask, that's IT much that, as that you need under-shipping clear million. thinking weaker

Michael Hurlston

Yes.

we're And is that's through is I there's that worked think still I in One think still of is, enterprise. the we've kind we two X pockets. inventory, seeing factors We're then, demand realized than -- that's the Quinn. Look, right, we generally, there in thought. as lower inventory -- is that inventory. perhaps

So X leading clear going we're we going these to I are. obviously, think inventory that us of demand still out levels. to factors those kind return, to and are where is

statement consistent, that once to back we're in happens, spending. the I So it's increase enterprise think I but business. in And that tied think remains

Quinn Bolton

understand the think you've is think for you've it. Got think you in times, Understood. uncertain. from that to think go reached don't pace I the But recovery then, I great of And line which sales in is the I least that a bottom script, here. put the the sand couple revenue, of you guys, said you hear. at down

be gross hit probably that of in you you the this Can of, in But also it, your revs. in quarter. XX.X% December-March may ]? December, also you've that think saw XX.X%, in looks March guided in the So XX% XX% infer bottom you we've we gross margins sort got call range margin the bottoming to [ bottom like

Michael Hurlston

Look, that's we think Quinn. XX.X% up We're into right, at March. guiding I Yes, ended December.

So as little point. the enterprise up front. sort us front the we low do think work of think on it margin It the that longer. is should behind worst I may hit its Again, that, on margin bit But from here. a recovers, even take

Operator

comes next with Our question Rolland Christopher Susquehanna. from

Christopher Rolland

commentary had on IoT. nice some You wireless

of seeing, And or of fide expect wins is design this -- longer snapback thoughts And we're your -- here? this on kind your here. kind kind from engagements, more through so, Is a rebound you I'd sustained Or of like visibility this this is term is really there would bottom? inventory-related? a strong, bona

Michael Hurlston

Chris, we Yes, have think rebound. bottomed sustained we we think a and we that

almost Dean So due the in We're largely said in pockets -- of is the I entirely There's to still comments. one way out. even all are inventory that. There the his snapback, actually I getting think wireless, think, there. not through we're but it

characterized largely of you So resumption a to is the end that snapback demand. shipping

I in actually bunch to here. as Analyst very alluded think around the that, size we Day, the converted said prepared characterized wins. one very, my remarks we wins, of are The automotive. strong I on of the And at top a which is funnel we've of of remarks, a design funnel. seeing design We've of bunch in

We're to here, for in billion building be soon to feel of year we the it's wireless. another entirely But in normal almost layering there's months. this to we've that seeing -- like I to now, that going the right right? demand. toward think there's activity $X just target start all last think had XX So And we're return I a going layer design

Christopher Rolland

there? OEMs think other little engagements if been I looks a it? up next this small like But and term, a GSXX, going something here? quarter getting bit. then, of market talking And beyond Samsung, for has the step-back you here. it Novatek year. the It Can a don't thought kind the broaden obviously, the we you longer great rest a how have know are I similar of quarter. maybe are takes mobile,

Michael Hurlston

a say, not we of -- lot Yes. upside I would opportunity.

levels. looking see at where of And say, market. think, that in that upside are good done one at outside we opportunity generally we But we in of I a to areas we're We margin a some end speaking, job, of high do. we do I'd capturing the the of that I of alluded mobile we is can We lot do from don't what see, I see and heck are mobile. appropriate think, to mid-tier, think can things, -- today. a Chris, sort the We've

Operator

Our next with question comes from Peng JPMorgan. Peter

Peter Peng

guidance, so Just implying on and of the a just digit mix low-single enterprise automotive, it's the based kind decline. Q-on-Q on

if So or that declining factor the pace. of at PC of bottoming enterprise, kind traditional in like it's kind your a seems slower seasonality, we

quarter, So that? more should puts March do that it's the Or how stability of bottom and so think the takes you think about forward? and we're at kind going in for we the

Michael Hurlston

Yes.

actually PC you think it I of high-single to sort right. down We're digits. be market got the forecasting

So that's biggest contributor. the

back other The bit. coming areas are a

a think couple got I you've percent. of it that's right,

So think at we're I the bottom.

But I business. think we're IT And pretty still we out figure said, in good, enterprise trying declaring are it about bottom, see and think as I for that. starting absolute in second spending. think, to numbers increases reflect feel when that is I quarter row a the to to the Dean we tied,

Peter Peng

a levels [indiscernible] trajectory? rate get then, $XXX you -- And half calendar the calendar in a of kind year? XXXX kind Or more comment think that time portion, first to back run of of was some this can business. million Core is snapback IT this Chris' the kind on of you that those revenue just on wireless Do of year and for kind

Michael Hurlston

it. good Yes. feel Look, we about very

in some I getting the wins we then of things than terms in think we top these here levels. inventory to back layer don't necessarily par on other have that's timing, visibility expecting very is of are that. good And the feel design on closer. perfect that but to that I the we much line think closer of again, of to sight

very feels So business wireless our good.

Our confidence is very generally high.

Operator

Our next question Cowan. comes TD with from Sankar Krish

Sreekrishnan Sankarnarayanan

kind IoT like but not for wireless on this is quarters And Core I'm just assume it guidance, question that through you're XX% Michael, the your answer, guiding the remaining them. growing fair of it looking growth X looks to have last of sequentially. I is a rate sustainable the and year?

Michael Hurlston

I pretty the Again, would we certainly, sequentially from digits here And double say, good to business. going we're quarter-over-quarter. feel see about

think I the We're think the trying that really, that where to back, close we that's it really questioner and business million previous good then about So to level, $XXX and from just asked, I we feel is. get there. growth really in, as think relatively

So of the quarters. in I think to or it's the this kind is us few for that the say digits fair sequentially double level somewhere over very, very next possible

Sreekrishnan Sankarnarayanan

Got the XX% it. mix. of products like And -- I product your then, quarter When Dean. margin guys guiding looks at be you the of like look to are to a it XX%. you're should follow-up gross if range, for March guidance, more in gave kind high more X/X XX% And your

of color has it pricing? still So volume? margin like Is biggest gross the I auto that But I'm overhang and Is what curious. it helpful. inventory. X foundry now? kind are be Any enterprise understand on side the on X would or

Dean Butler

sort bucket I products. to sort have it own tends gross mix. products, And a some touched that, variables way. his many Krish. a always that remarks. of There's at obviously Michael There's product levels. think going bit happens to supply There's than There's absorption the prices be improving Yes. actually any the side. in more some opposite current But in of actually Generally, of on revenue higher on the within little margin its our enterprise mix of prepared even

go most audio stations Some applications of some hesitation headsets of high-end like best sort gross or IT margin are that docking our into corporate from of buying. of the sort seeing

to And on where so, margin we are contributed sort that mix. of on the

moving grows, IoT. However, IoT ] modulates helpful, is also as else around. we're into [ starting to Core see actually And upside everything that

Operator

with Gary Fargo. Our Wells next from comes question Mobley

Gary Mobley

hearing you you thinking size or be than At the market I'm pushed your bit it Analyst guys smaller correctly, the potential a at which of Day. therefore, you sounds minimum were little of in out like healthy is, least enterprise margin structurally, what long-term perhaps If might further XX%, is is right. highly that very sort question enterprise? gross on reevaluate the mix to that margin target to I the contingent believe And from the causing revenue

Michael Hurlston

you as of I in more. a it push-out, the think Gary, right Yes, question nothing we one phrase see got that

So good for I think market about that business. enterprise we sizes the our feel

changed, the there behind I that environment the right? But we We've we enterprise out changed. businesses? what that IT some certainly long to in the is that don't the to those sort to has a actually way the feel enterprise substantively think out, demand that a due of profile demand in is term gone actually has depressed not huge realize customers inventory, of and long-term demand current these spending. And hey, assess believe in

So everybody enterprise is docking still bullish about telephony. station consumption,

fact, headsets. we've will on coming new both that and dock got and both in, refreshes areas, bunch telephony, In of in be in enterprise a half kicking enterprise those of the second year, of this

to IT of which change. any there's -- the the sort Dean, don't those drivers correct line. that spending, of all segments, our think of can are definitely due our and So wrong big down I'm me enterprise pronounced X if I markets. you view overall margin of

Dean Butler

going don't what sort destruction, Gary. for, of there's No. Yes, a I market you're if that's think

The XX%, that enterprise target for second dependence was on mix the company is on which part your margin. gross to drive question long-term of the

We well are dependent on and more performing enterprise back actually normal coming a level. to

you back. we're to coming And longer timing continue predicated going dependent think is XX% means the and bit sort is little to it. enterprise of the a will spending that I on really achieve to see on be what is probably

Gary Mobley

in quarter roughly X%. on Dean, the side December OpEx you by the underspent

normalizes, we variable aggregate about start model that when OpEx to how was revenue. like Correct should more it, demand, call and me there, OpEx when terms structural in I'm think to quarter revenue per Sounded most reduction. in of versus curious if $XXX let's plus but million you in the actually about I'm end ship wrong

Dean Butler

Yes.

where quarter, under of prior the doesn't you from of sort variable was guidance our it expense. that March that, is. right, to it actually the quarter, quarter reoccur, and on up on guiding It under picked the that goes Gary. into level December So We're rate spend sort first, exactly back run really a onetime

committed our on keep and inside $XXX been pretty below, that know, has to or good -- you quarter maintain done a it range. operating we've expense As sort of a million level job

would to think that monumentally expense, likely more like adder something revenue hey, more. we Gary, what we of wouldn't that I start does say I this think that do it's But look as high-single comes a maybe you X% if on Now, revenue a higher way than that we from a it's need spend here. about, likely bit in. base, like digit kind the would probably mid company go anticipate The it, to operating about up at

fiscal You our the comp, bit in there's cycles, resets sort cetera. merit year, will a little on of variable beginning year, of every et see, of the

we're Just year-end. a June reminder, a

that of September us. to for starts the hit quarter kind So, in

helps, hope So Gary. that

Gary Mobley

It does.

Operator

comes Our with next Rakesh from question Mizuho. Vijay

Vijay Rakesh

to the Good has bottomed. hear business

expect just how wondering the kind just just 'XX, or plays out XXXX. I'm So the year back exiting wondering, the looking at for something? level you million get seasonality to rest you Do of that through $XXX to of

Michael Hurlston

is of from nicely. us thing The it's XXXX, up. is Look, question. we're to like really tell to We're Core what IT here. sort one going for bottom. I would good kind calendar of Vijay, happen say coming Yes, tough is growing

mobile applications and type very PC seasonal. are However,

go hey, think the from We're lower. to we're move to I likely handle most the to I unlikely sequential of I have is, are higher. trying on, people get think comfort almost a industry-wide, move actually, does how sort here?

have So sequential on now clear tough look and see that continually, by I what like. for for more think what IoT exactly probably less us. right we is and just of the Enterprise led IoT. is confidence will Core confirm, It's Vijay, it's us behind. most to higher, seasonality Core sort growth would pattern you

Vijay Rakesh

on And with it? expect you a it. on side, thought AI many with the see I of then, PC you pretty PCs the the PCs Got XXXX family products had any demo how you AI into PCs, with that on we good in -- think do CES. and many how know at Astra But Synaptics

Michael Hurlston

PCs. stuff AI mean, -- Look, Vijay, of the forecasting line, very, all PC growth about in number we're very I on hear We units. modest we're this certainly our

our the are new the onset COVID. half and COVID, X about bought customers also given year, PCs ago PCs, years Our of a back customers the pronounced talking keep talking pretty about with everybody refresh AI in of

Astra be much what We enthusiasm. I excited it not share. Where hits, touched of PC any -- customers any make it very we've different with on user that you AI-centric, have and that will to more and -- intend be MCU couple it of over -- next product AI will presence on it certainly to that in of that is are slightly we're have detection helpful a capability. a look, that more are continuing the numbers the a take it's that's us the area very area what don't quarters muted. is and general-purpose to If we with enable the think we one done focusing baking and because of whole of we Our in, product general-purpose we're

see at start pretty sample expect the And like prepared adds the if our it's selling shipping well So next of into end for think to of into They've the the will customer differentiation pretty that big we remarks. it AI a platform. to bounce in product terms of brings. on the they calendar it, sample. this It and level and about in talked PC we're the year us, what They excited. We that seen performance incredible currently is of and the MCU. things go year. seen They've

Vijay Rakesh

And question, it one sneak if in. can I it. Got last

a quarter, that at pickup pretty last mostly of that the On are with through trending? looking handset you the how GSXX I but good you thinking win business were handset comments, missed one year? Or flat side, well. you had big your as a obviously,

Michael Hurlston

Yes.

is to just say, seasonal. some of But Dean very lot one talked in seasonality. things think upside. from that a where going think be be and think the performance are to are, there's of high shipments this I I'd at of point. questions. our a get at the has the given difficult. nature. don't China we at definitely the IC more Samsung. said some to will I at Samsung where gains for possible mid-tier given that think there's There's more attach rate point, downside it's track of in the that and of But we limited on balance, and Android kind we in done. significant work can the we're handsets I we handset going That's significant, share this team share, We

Operator

from Cassidy comes question next Rosenblatt Our Securities. Kevin with

Kevin Cassidy

to are of the WiFi Or been is you're these then results. leverage IoT, the calling MCUs in you are And activity? activity trying on getting designs? There's Congratulations getting also, your WiFi on Can weakness and of coming -- you back. combined a design to maybe the what you the lot tremendously? seeing are -- it this bottom relate and talk and your you it in about up parts? past kind some cycle, Are

Michael Hurlston

are thanks for Core words. IoT, we On so Kevin, the first, Yes, excited. nice yes,

million talked we've I because to you out, design that Again, then, mark, on starting we start the wins is early a innings, with automotive. $XXX had well these lot still traction, products. highlighted wireless questioner ecosystem as now the well it's previous to doing but area revenue not our and We pointed happy very to with below the we're numbers of we before. about layer a overall We're think right? we're And think still which hit. us, we design get what across for there in. based new just And

those road. ones we kind think longer As the about of are processors, a

customer our had which calendar seen drivers wireless. -- before soft is that our we are we launch in to the slower-than-expected the lump they our wireless of very software ramps. and Astra, definitely of so they very, a So have pulls instance, through are What we're year. offering, through. pulling up and We end it processors yes, trying in our In package every wireless kind

are taking our we have before, All cut budgets. have of engineering of more largely wins time kind than their because these customers new

-- used think time been time. just in at and had thinking we've numbers has We now than any losses this And slower our of point been initially we Kevin, ramp-up think the We're than bit our so, forecast. baking these times, ramp generally slower in to. than historically are slower historically don't we we we've that But it's than in saw ramping little a seen.

Operator

question comes with from Yang Our next Oppenheimer. Martin

Martin Yang

on and feel differences, cycle for budget you that year's get this Have question spending? -- XX with our automotive. slightly will inventory year-over-year 'XX started enterprise regarding be a enterprise annual down, a on flat, up adjusting one speaking Do for have calendar customers I you basis?

Michael Hurlston

Yes, Martin, I generally 'XX. think than is better 'XX

We're forecasts. an issue. early still giving in year. the are it's customers, We're So customers staying to the and their close obviously

second and is Everybody for from So Dell let's removed both, HP. the hopeful step we're one half. say,

a built second and lot of the think there's half, optimism into that. see I we

Dean in that in think, what's I signals remarks, the we're it's the removed, working one there prepared second I be to said as situation. through in optimism inventory said. we're What's as we in although Definitely, demand it's said, the still the I generally half. now, step demand? [indiscernible] pockets, going the the getting, think enterprise?? but as we're We And think

-- So it's bit the picture still a cloudy. still is

Operator

the now Michael back would remarks. closing any call Hurlston I like to turn to for over

Michael Hurlston

our next to to at upcoming certainly look quarter. I'd you and like for investor of you thank a all forward speaking lot. We us conferences today. again to Thanks joining

Operator

participation. your for you Thank

You may now disconnect.

Synaptics (SYNA) 8 Feb 242024 Q2 Earnings call transcript