QUIK - Earnings call transcript Q2 2024

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Operator

Ladies and gentlemen, good afternoon. At this time, I would like to welcome everyone to QuickLogic Corporation's Second Quarter Fiscal 2024 Earnings Results Conference Call.

As a reminder, today's call is being recorded for replay purposes through August 20, 2024. I would now like to turn the conference over to Ms. Alison Ziegler of Darrow Associates. Ms. ahead. go please Ziegler,

Alison Ziegler

and all operator, joining you us. thanks you, of to for Thank

are: and Financial Faith, and speakers Brian Our today President Senior President Elias Vice Chief and Chief Officer. Nader, Officer; Executive

our Actual of the involve payments including stated future the mature schedule gross that convert the production differ expected for broadening uncertainties, to systems; profitability expectations cash expenses, dates profitability opportunities into our financial As a the number to and statements start of cash. new expectations reminder, or comments makes timing from partners; timing market forward-looking that shipments; of and could to risks limited impact and acceptance statements today regarding not and such discussed shipments; design flows; margin, but today. future evaluation and activity operating products, revenue QuickLogic customers' from future results contracts; including, relating timing, statements changes those are to, the government and company's results some regarding the milestones QuickLogic's production expected trends performance, related and revenue; QuickLogic's statements revenue, ecosystem to ability and and pertaining and design products; materially of timing its may of new its

be today's forward-looking any will reporting information as the of recently please discussions of update we new reports the financial periodic differences, risk detailed assumes to refer speak that QuickLogic QuickLogic's measures. no events. In filed respective those risks, SEC. of future in obligation the most more discussed statements could or non-GAAP For uncertainties and with result assumptions any which information, factors to or the dates call, in

for and financial earnings release refer a results our of to today may GAAP statements. other You to non-GAAP detailed issued we reconciliation the

these account, business. information current Facebook company that QuickLogic have also Twitter web our page deemed LinkedIn as blog, website, uses page, distribution on its the updated Brian. may non-GAAP Regulation of use prepared posted on QuickLogic provides will posted financial Such an note, would on may turn shortly FD. A today's call historical after now IR about be to the call. I corporate to channels over conclusion page and with of its today's web and of be page remarks its the information, table obligations IR We QuickLogic's and data. Please to information material made channels copy under the disclosure of call earnings like comply

Brian C. Faith

conference and Alison. Good you all thank call. second for Thank afternoon, quarter you, everyone, XXXX joining our

first year Unfortunately, XX%. cause made have lower projection overshadowed X the XXXX. to our progress push is months growth that scheduling tremendous of during to that We progress some full by us outs

revenue the full As sharp through revised the QX status a Elias cover of in QX our will followed be we projection. I in step rebound in will QX very from contracts, growth year by detail, slightly our realize to competitors will contribute want but up not push anticipate few would XX% major you first outs of And growth. any did make I by to we QuickLogic. of things due We expected caused the absolutely to the contracts to clear. delays none were to a that lose

performing contracts or all proposals. are on ahead pending schedule We and on of

potential for most are our that have extent the outs significant contract IP beyond deliverables the of contracts balance for phase. the of in majority quarterly a we've the major involves support cover the to deals have revenue believe that of the I status XXXX. early generate IP the say smaller deliverables revenue we implied will beginning one in in I as The generate because you of can years on beginning will outlook to push also I I contracts. We conference scheduled to of the XXXX outs calls. the revenue Only push that update QX. discussed

As the driven has larger is for high-growth I've record and business phase, our calls, profit actually past margins, which deliverables foundation noted IP model. in the

base We growth demand, forward. expect will IP expanding that revenue accelerate customers, will rebound sharply of going in year this QX revenue an from of and

and our In late from addition, beginning next we phase, revenue which believe layer includes will chiplet, storefront XXXX. on in

X. XXXX. Let's to tranche during is Strategic few X attributable award On calls, usage Hardened the of of Radiation tranche this FPGA announced now forecasted Radiation we contracts Strategic a X, contract. minutes mostly million, the similar to and The it we as conference our July the timing and contract of was status The in update tranche that $X.XX take last in third Hardened major QX a initiated of the the cash some accomplishments. is our higher-than-anticipated our rate to August has value funding of of

and this As strategic the requirements. expect will the significantly QX including future to payments is QX for development cover, total these Elias we benefit flow. received X funds continued in XXXX. we rate The in will If Strategic exercised, in Tranche identified will system contract, anticipated million. are future that space funding cash options Radiation DoD potential Hardened and technology $XX increase QX the support options, FPGA of

supported Hard building the of and new customers beyond. nodes number the sectors, to IP in market by as business expand positioned contract, Beyond we as significantly XXXX our on very our success are government and across large our IP fabrication well of well eFPGA many

new $X.XX and With submitted increase the $X alone. a including to that during opportunities. is from are with the million it have totaling Tranche our new we last result million. major funnel replaced award X, $XXX approximately with of outstanding more to there Within than net proposals, The business, sales X booked customers month RFPs we this, million numerous moved

from Hard on the to BAE Driven Innovation plan. deliverables. On received outlook, win in capture and FAST Intel Given Supplier well-positioned our Military, customer IP. position companies for new Aerospace accelerate designs, we company's source Hard of specific believe award the that a capitalize for of and XXA. Partner X IP growth believe materialize we XX, its Government category that with Generator have eFPGA be we optimized quickly we Year. targeting joined of announced our Year Intel June Win contracts Systems Labs schedule funnel technology storefront of we unique develop milestone also will XX, QuickLogic to begin eFPGA XXXX. On demand Accelerator the the beginning leading our and We Combined Australis the Technology chiplet to that in May Intel of as will XXA late Hard the interest is ability cores, IP QuickLogic significant a opportunities the and and X-year IP by the strategic Hard of to Alliances. we This Foundry's the to development initiated this considerable will announced U.S. IP customer-defined already marks for the in the Partner

our will During that be conference second process. last call, using contract announced a XX-nanometer I we booked fabricated that our

is contract GlobalFoundries' Defense customer with first fabricated be The a and on known as will Base Industrial XXLP. XX-nanometer process

to complete cores schedule during on revenue of on deliverables recognize the XXXX. half are and X second our We

XX-nanometer will a recognize. contract second a I'm be power a ultra-low that industrial its IoT This TSMC The design design is would with applications. that and is SoC new large of process. fabricated by This commercial on variety targeting company sure for is international you

acceleration, eFPGA often a rapidly to this growing algorithms SoC, by We believe necessary is be that will is the better a is a AI most eFPGA running in the applications. used for application function our technology acceleration prove processor software. Within served which AI in than

to of schedule and on XXXX. this recognize are for the second We deliverables complete half our core revenue during

device a Last design brief we with conference more In the Hard resuming on our customer quarter, work new of this We customer incorporates aspects during our of on working what design XXXX. we certain a half that for I a confidentiality the is update. shared eFPGA can't on the continuing beyond line share design I a I stated closely Due that requirements, win are new during second efforts covered specific with through out IP. call, also that anticipated this the November XXXX, to to I our details strict last customer proposal. In taped design.

semiconductor fabricated that IP The at millions a our multi-project one of in the our a a forward. Last on a that subcontractors, IP of detail IP due go we with completion be and revenue for been couple revenue of chose delay using announced Again, design, is availability solid could to we strict platform. fabricated the our design XXXX. wafer leading of customer's and have Hard confidentiality now XXFDX chose is a leader recognition a to to share GlobalFoundries the program November, be starting represent can due have to that pushed in the will out However, deliverables GlobalFoundries' of global we XX-nanometer September, eFPGA announced I I technology storefront delivered company our tens UMC's eFPGA years. Last of process. potential will for Hard into customer dollars go a design but awaiting move a that shuttle cannot the to requirements, on more still

the expects total, its Hard to In completed X foundry/process contract customer delivery using during eFPGA we will and on delivery chips IP of out that different have XX-nanometer was combinations, technology on X on technology. of IP. schedule the including also our completed We deliver fabricated QX. Tape first be are our

we submitted In eFPGA believe In year demand be we growth from in are Australis demonstrates eFPGA track advance this that to our a the for offer addition demand R&D for customers to This accelerating way. the costs. enables address XXA. Hard to targeting to IP Intel believe will be X company from this, many Hard IP the we of to that new leading first Generator with XXA. automation ago a a Intel is these, and scalable market have IP is what designs Xx we us on This minimal for associated proposals up in the proprietary of

to We XXA leverage as our our expect engagements. increase even evident trend continue we this more becoming with

have these of large awarded proposals In to addition contract contracts, pending. a we number

and the value a pending large a major semiconductor These proposals proposal have which of a mid-X include with new DIB company. figures. in Some

storefront could Some designs. end as these proposals of up

chiplet including we partner, In in opportunities addition deals to our funnel, have potential our with these, several YorChip.

that customers pending XXXX. previously over proposals first discussed from value million, We're of with $XX feedback release awaiting excited are integrating half very our YorChip. jointly in our is with FPGA and We combined IP one X of YorChip chiplet conjunction a developed the QuickLogic partnership have second in about on

a chiplet Microsoft, this line which including from LUTs. be seasonally product line across Qualcomm, Consistent our Meta, leaders to with FPGA Google ranging earlier the chiplet we continue rebounding bridge shipments expect quarter will variety during TSMC. forecasts, our ramping, industry million in EOS is this will first include designs Intel, expanded LUTs we with to increased AMD, believe of will We half through also Arm, modest a volume low mature new shipments the UCIe will our With product devices rapid applications. In shipments solutions are XXXX. supported customer a Samsung now we of up smartphone enable believe XXXX. FPGA Cloud, of of adoption QX. prior SX lead and year-over-year. include wide outlook, in and modestly be revenue very will These XX,XXX display forecasting with increase X a chiplets be will QX to forward, over by our Going interface,

eFPGA for in distribution Australia reason partners During we we Israel, our to The of processes established a increase Hard and inventory new covers like solutions Base comprised CTG. X CTG's key literally the distribution. On us that leverage and them cover scope expand give primary with markets. pre-qualifying August spanning by DIB our with and are invest reach our Turkey, hundreds support, enable extend IP X, this DIB Defense increasing CTG demand deep fabrication source of our Astute within of our benefit and seeing to Their and gives is There Industrial often could of expansion decades. our the close It Microwave is the programs agreements: interest address within could and software from the programs by traditional sophisticated soon international one is eFPGA of will to software significant us the technology our that July, from customer that most significantly expenses. in components and be we comprehensive bitstream. India; IP we fulfill eFPGA to makers. storefront before through customer-lifecycles that to direct distribution address the FPGA role our the used efficiently very resources. Aurora Zealand. programs opportunities we are tools, with sharp suite announced established device distribution decision support tool open partnership provides popular RTL programs introducing coverage Electronics, With or growing that Their our beyond for seamless markets can customers long-term chiplet. extends from us Spur which the can second through with collaboration potential knowledge ensure across will New of international operating and several integration for announced beyond without design. rapidly Europe, and proprietary

given in eFPGA is by for other With the additional provide we will XX% we improved of and have of reduce these and improved improvements a improvements. Aurora IP scheduled scheduled have update, size X.X X.X speed Aurora XX%. in further X.X approximately automation, we by continuous scheduled Between and area core and and for QX. release continued June, QX, X.X performance during core. user improvements timing release for the cadence the our and experience last In interface we for works XXXX, is die flow increase

better means use, cycles lower costs. our this performance, For and shorter development customers, easier development

we For that means sensitive QuickLogic, faster speeds more can require it designs address cost applications. and

to AI in SensiML. press years AutoML open at XX. the Piccolo to models accelerator announced Piccolo maintenance, with AI/ML efficiently edge source on SensiML regardless to recognition, science. build feature own development Generative voice microcontrollers. platforms QuickLogic, X AI Turning recognition its autonomously for rapidly and identification empowers run SensiML of companies business ML strategy speaker their release source of recognition, development enable open applications is voice datasets On and tools expertise a its gesture success complete of are rapidly solution SoCs. new predictive X May detection specifically source the SensiML on audio an AI/ML the spotting, monetizing is AI training developers keyword XX, a applications. optimized enables custom their companies data to AI that and model command open on planned low-power tier develop SensiML's Leveraging first for edge These July anomaly and in and collaborating including top to applications. experience launched microcontroller

is for on over turn With let of for already Elias, SensiML in a now closing report go that, track XXXX. With ahead. the results, remarks. the these significant and advances to call engagements, and please financial to review I revenue rejoin our record Elias all-time me will

Elias Nader

Thank you, Brian, everyone. afternoon, good and

end product was guidance. for at was of XX% XXXX Our which second compared to is this were revenue second timing QX of quarter rose was also $X.X contracts our the our below The reasons of million, the but to XX% outlook. from quarter and down why and primary the revenue revenue, new lower certain lower connectivity

include for margin $X.X our in New the IP up last QX outlook Mature to but lower-than-expected flat year last XX.X% gross R&D QX and product revenue revenue XX% allocation down was below our in with primary non-GAAP gross million, and was QX QX. Non-GAAP outlook a XX% modeled as to XX.X% year, our higher from in reasons QX. and QX up was of million, below expenses profit we from year last product QX, QX COGS. compared with margin essentially quarter. what XX.X% was XX% in compared and The revenue $X.X

COGS. expenses an much Our investments non-GAAP Operating This QX of to It be much how be below operating our challenge COGS. in with because attributed was approximately correctly ongoing project will $X.X operating operating to quarter. how expenses expected we and expenses last first compares than will $X.X allocated R&D to R&D of the $X.X and outlook portion year larger will quarter million expenses to million allocated be our million. in a were in the of were second non-GAAP

or of $X.XX $X.X line the out. Non-GAAP balance our share to first income net net on compares per in This diluted last at $X.XX will of was or X share And XXXX. or fiscal net per share. second million, million, million, income non-GAAP of year's quarter. loss a $X.X the $X.X operating loss quarter $X.XX the statement, However, non-GAAP in per

credit payable timing for These of Hardened payment. close accounted XX% the quarter, total attributable was higher-than-anticipated our million $XX.X Strategic at include QX, million with is our contract. primarily second revenue. At of total, during close more $XX our X compared our year-end QX. figures decreased was $XX.X $XX.X of a million at cash $X.XX XXXX by large the For and customer of or the Radiation cash QX mostly the accounts which million, to usage facility. In The non-recurring million

for Our assets, our reduction of receivable QX. increased this was of contract change reason the in the $X includes accounts, our by primary net million balance cash balances which a in $XXX,XXX. Combined, the accounts in

QX QX QX moment, our will I benefit payments cash a anticipated in we that flow. in received in will As cover

the for million, guidance XXXX. QX fiscal our September plus Revenue is quarter guidance approximately on which XXXX XXXX, to XX, end third XX%. or minus moving Now, will of for $X.X

Third of revenue and million in quarter approximately $X.X million products new $X.X in products. comprised be expected is mature to

to QX half IP now in and for being second lower-than-anticipated into some attributable QX Our revenue the the XXXX. cases, revenue guidance is pushed scheduled recognition majority of

to our sequential these implied year of non-GAAP deliverables the realize but XX% the noted, the changes, Brian large QX process. Based the be expected this percentage in and I minus as growth. lowered margin to implies XXXX, we With growth outlook X very on have to are majority needed full approximately anticipated this QX realize or XX%, revenue third in quarter revenue books plus points. for mix, is gross on growth the

$X.X expenses are Our certain occasionally our %. the nature our plus alter timing to note The non-GAAP gross operating cause expected primarily factors we full costs. margin non-GAAP approximately our labor XX% taxes, range. After gross forecast will XX QX may profit reclassify believe revenue on COGS. current XXXX be year mind roughly for $X.X OpEx be expenses. we to customers. or based non-GAAP difference are that share, non-cash, is and and our be our will compensation similar and contracts industry, outlook, recognizing our be reclassifications interest, year million, tooling full QX, revenue the these the we related million, Bearing on other GAAP will this for COGS need The $X.XX per income upper million margins with loss in currently approximately our certain net in QX. capitalization may to in operating between we or and and results. to corresponding the minus stock-based non-GAAP This and of shares. compensation or in capitalize expect $X.XX reduce results to may Please to In XX.X to given million related variability $X based expenses that $XXX,XXX, approximately expenses to Such

be outlook, double-digit provides shorten contracts will his revenue back it the As takes strategic movement in report now to flow contracts, year it and be grants are expect call we us year midpoint the awarded. and recognize to a which employees. At during and based may processes if positive we reminder, advantages us there of fiscal our closing quarter are the very stock-based for for the vary for outlook these each the on With our of processes QX, will full current X compensation to timing with Please usage advance contracts. in approximately for Hard Brian XXXX. Thank let to pending, includes in cash to certain that, fabrication eFPGA we for some remarks. on strategic you Intel XXA. winning over We much. time note, we IP be our of in investing $XXX,XXX. me developing Based believe will this believe cash the development This for are earnings of turn

Brian C. Faith

accomplished to user We open and going. our what a still like to Thank are source the believe I source we leverage today far, are technology and would I company eFPGA to first integrate have and were the in are to into IP open only you, eFPGA fully summarize components take where so Elias. we where moment tools. we our

decades integrated or We the delivering embedded of continue IP are devices designs. has X and only These to include discrete in also eFPGA eFPGA. company devices FPGAs win new over that that experience

XXXX. to not goods software foundation opens thrust silicon IP. IP from leverage fabrication customers. our This model the quickly and the tools, our eFPGA more eFPGA While process-specific to of have customer-specific storefront we model, services business create these to in profit. The open is finished fabrication opportunities and for processes We enables proprietary this our everything provide and our are more solutions us will Hard than drives the revenue foundation to experience Hard leverage eFPGA our for of capability by software managing for unique process-specific With tools source IP merchant X resources existing much and of business our business IP different with competition. unique end

we create to to Intel these, for schedule believe Hard customer-specific are we IP proprietary XXA. addition leverage IP IP. our our be a eFPGA process-specific In provider eFPGA Generator, Australis of on IP we leading quickly With Hard Hard to can

to Hard has company and We are the model growth technologies in much port us accelerate significant strategy. driven With addressing this Australis proposals This IP favorably only business the time eFPGA wider Hard our leverages to X our also process a the base, competition. we that scale enables relative continue customer customer-specific eFPGA this IP and to new costs. expect will growth our takes very diverse IP half IP operating during now more years. it to last about

have rate growth eFPGA it. All our all, foundation, in growth CAGR are are late extremely that questions. and foundation the growth X-year the going that XX%. IP for more with years. With well storefront call of above our our IP believe grows, in lower maintain are leverage we XXXX a we short, We more that, turn in the I will for our the profitability. chiplet positioned outlook anticipated rate over to and long-term from our even things is we to or of coming most for the and the layering important of revenues will and In believe accelerate addition growth on In success begin exceed of XXXX, well customers

Operator

from Rick Rivershore comes Research. Neaton Our [Operator question Instructions] with first Investment

Richard Neaton

that of revenue push year you're at customers. not your telling because Is you certain outs control being have what $X about of under pushed into next us? million So

Brian C. Faith

That is correct.

Richard Neaton

Okay.

status supposed going mass year. eFPGA the next your out your or offer node? IP first enter called situation You the late XXA new Hard Intel eFPGA on be node to to production to at company that's Are that you

Brian C. Faith

believe be. is I our will target, we That and yes,

Richard Neaton

Okay.

storefront million. of grown about to the In now, that percentage $XXX potential sales terms revenue What of are storefront deals have in talk you that the funnel deals?

Brian C. Faith

don't When right half that, X-year front remember, that, have But I related that that funnel. percentage our I in Rick. deals. say that of funnel funnel, would than look I say to at a of total more storefront of me, are the way we is

So it X-year we're calls value that about actual the at in starting window. be higher of representative of contributing falls would is and that the of sort of the significantly really revenue next but year, of designs. funnel outside development just talking end those these storefront The

funnel the magnitude X-year would So be that an the outside storefront perhaps of even value significantly higher. themselves higher, devices order of

Richard Neaton

One other question.

deals. in You entire chiplet of potential the the Is number I in reflected million $XXX talked you that think number $XX about, terms used million?

Brian C. Faith

$XXX are firstly, least X put -- it's X-year specific chiplet that in all project. funnel, forth. of those not. are because No, that those development is And is we've those of that at one Not million a for proposals

see going as million. that some that I factor an of that inside third come time, of think outside start acceleration And is that sense to as march inside gives -- It's up. there's so, X-year window not through that you value the things X-year window, funnel year And $XXX yet. we you the hopefully

Richard Neaton

Hard the deal. Rad -- question on final you one Strategic Can

you Conceptually, in after concept? that are particular other change revenues change does to how something this other deal talking a phase tranches development or production of point about to the development? How when of you into deal these been awarded terms X You've some moving QuickLogic? in first talk of possible tranche that if tranches. about the future this third possible are going is in at type all Are

Brian C. Faith

question. Great

for years of that's chip we always I'm that's that taped options, chip. storefront Base resulting publicly say what the X chip, goal the the manufactured to And other to that And $XX roughly and talk the So, over And or having that development chips we when actually X the talked just a that across storefront device, is million million a the the $XX just of being of $XX that we've $XX and is about they million and chip. our storefront for and part revenue talked After device test development contract. space X contract tested, it's final supplier strategic what none potential contemplate that, and roughly and become to Defense about. of that, about, out, is allowed that execute years million. applications. Industrial final is

redesigns and for designing I of very several driving dollars, specs I direction think programs, several would going new And it's essentially I've million once good several in done potential there of programs for device not use if my our shared the what on forums order that government designing. that They're that this the even hundred are are that more for the developments that view with are market probably at of chip. is the than think through programs the that. we're have we're public that's what because

and after engaged is be wave that would finished it device that so, that a can can we looking that that I happens. is absolutely we completed, that doing the users who to be smooth so from are at storefront of don't And this And device you with that beat miss obviously, we so that us, would of of insertion ensure before the And this guarantee transition is next potential program if being designed. we're so. in development end

Richard Neaton

you're it now. halfway Okay. about that for In through X-year timeframe the program, original

from Is this if that 'XX goes and in as this they been. what assumption? to above 'XX a you're correct accelerate So, expected, revenues program expecting significantly have

Brian C. Faith

is. design any would Yes, that And I cycle. follows normally in it happen what think chip

When start increasing. starts we And chip work. You out things, taping talked haven't your manufacturing you this cost about program. the when initial test have design for that's a yet

the of for So that will the cost you chip can doing and testing increase. start therefore, happening, cycles that that we detailed on some the chip learning will when and revenue really starts imagine also increase, final

yes, happen. assumption fair it is that that a will So

Operator

comes And the Craig-Hallum. Richard Shannon question from next with

Richard Shannon

catch to follow-up here about you your I'm from the to mean? what IP of to question space, here. I the in I I response that And last Or deals that mentioned things connectivity going that the missed were going push think revenues just of level improve? exactly on expect Is connectivity. A And in of But did that? lot IP year. X correctly detail this outs and for some that the talking does a is first then lower here, think there's Brian, in largely deals expected largely remarks, part question you I probably forward? it prepared revenue the

Brian C. Faith

the looking some push year. of we been the industrial So They're QX outs funding from primary we've guidance to technologies and connectivity and let vehicles, call to orders customers our defense defense. The for forecast And time. markets connectivity those what used sell their transpired for The some on with of happen aerospace side from that are especially me the for that selling those and this FPGA devices. some QX take that product first. actually are some on for were there we address one the it last definitely make essentially to

of feedback, revenue some that moved downside definitely the to hit we've that on half So a to number. the second QX that out was based but

of that needs of that and XXXX the as the pushing marks, them XXXX everything us about preparatory mentioned lower deals, IP one and from what a in the subcontractor some to perspective, XXXX assumed we'd that that, slowdown biggest was The subcontractor that specific that which programmatic is some need of to to something were November will which for are for now. smaller tape of the revenue, think revenue we customer of we the XXXX a them because pushing some into talked had reasons in the XXXX of delays into already they push from be going out that's having half I that the second means smattering was out sort the ultimately there For were previously deals, impact project.

Richard Shannon

this, deals. sounds or manner of the on they reason November consistency it like there Is consistent these? follow-up for helpful. other XXXX to That's kind unique the Okay. just customers' And Are a in a some program-specific?

Brian C. Faith

out place just to they They because, something proposals it. They forward lock up need USB not Hard bit they're next needs, the And on their for shifting is from cord. not they're program just the going valuable get quite cases, pushed shifting order year. In in cases, in some IP that to then need than resource a if they this It's reasons move XXXX. more the to have IP a That us. schedules obviously, year. other into love funding to order need they're In that. will project of

far if So some as interested go X as industrial and it of goes, as that, comprise in falls defense, it's into buckets. And market sector those you're as aerospace far largely basically markets most primarily the and those that opportunities.

Richard Shannon

in too of XX%, the terms an and not but half Okay. be way other? say the or kind here. roughly dollar it the Or in is would guidance one specify is of difference it in to I'm going equal safe contribution leaning half to terms? it probably XX% much, to that

Brian C. Faith

to enough close half-half. probably It's

So let's with go that.

Richard Shannon

Okay. Fair enough then.

as Let's looking here, see latter out maybe provide comment the kind I acceleration and here or sort here half the year opportunities more into get storefront. here. late can Maybe about interesting bit chiplets of times made of farther of, you a couple this detail next a an maybe and how to contributing little related guess, are many inflection? to if we you

Brian C. Faith

IP opportunities of storefront IP-based because of actually responsibility. asking development also of tests, now the I'd devices, just and say about the are to device FPGA knowledge in manufacturing our intimate the and us XX% in the any not our but quote coming

alone, in heard mentioning of prepared my last my in the month just coming million probably remarks deals $X You in in.

Some seeing IP the and around how and design it's primarily really also are to with how of, are increased development if in do to million just that's that clip things. a again, But knows I'll of want actual number the again, the responsibility those FPGA, that -- just work the we're not call, do a development And storefront. people that device these Maybe the custom whole at they do doing don't company looking that. the $X storefront I for FPGAs, just storefront used, development, not that's revenue. what not SoC

we operations handle we an storefront-oriented. And So that management. can that, percentage iterations can that seen chain perspective, have thing more And, b, because great business is of a, Australis the customer-specific in about team in do supply our notion the whole the we've IP. and from of we our coming definitely is, model through that an are increase are of a our development designs business

IP on process -- IP interest so, related we on IPs for lot that coming you you seeing the already in which those ready process think because also of And have more is the different to factor fact of nodes. more the accelerating I process now sort have a have the that, we're technologies, now

So want of whatever we do XXLP good XX or it a when or that. may XXFDX be, in come and have chip coverage to customers or they at TSMC

for well. providing turnkey storefront can respond I think a with really sort we quickly, and that device good full So quote as and in value of

Richard Shannon

I'll a look later Very Maybe last some back question, interesting there. stuff of you Brian. comments at there, get on that, picture. probably good Okay. those big and to my kind little

questions consistently like somewhat One investors deals to get from of of always I see here. announcements I is, the

Strategic the there's of nice couple ones quarter Hard, a I'm than had sure this year. not last the lot You in a Other quarter. Rad first

you the how to thinking the got in even able be we if across perspective rate And the number of how might have maybe about they to So here the many win get you about a funnel? contracts of help do second you've line about finish many of announce half can think a how the in people year? think and proposals here

Brian C. Faith

there one in that, tell of the Again, can the but I'll answer rate, on I rate exact I first increasing. win don't is certainty me have win number the last front the you that with

how have it those of development the lowers our my that point, present up of to IP we earlier IP, and the the technologies more more existing cost refining we off nodes. for, support speeds we're already time, process As it becomes customer-specific

deep also I I eFPGA we're custom better at And smarter the as the much dives getting, we about on that, rate that. And result and hit do this think, target is a doing We're approach. to getting think so, how customers pick of increasing.

this the addition I general, talked the have about, of in we that that, fire the you at now XX government We're that to the yes, hitting goal can we we're revenue rapid tranche like to beginning to in the us to of closing do to in for of XX good just we'd be year. think beginning We the to contract, but goals. in beginning, have would a spot our XX. got year. right the right, get IP closer this in And if of you're ones year, third going year, rewind process contracts still the won much

ready call this of IP again, delivery, especially request upcoming would fundamental in get in we've done move when from for really also they're I doing we customer-specific transcript, to ones that and So, just XXA that say, an magnitude work still and Intel locking because and are that listening can these reading the got be hit somebody notable foundry terms and revenue be in quickly investing on quickly people node to to announcing and our rate, for I'll keep that increasing of your is like we want comes remind therefore, to the sense so we're we that respond that we foundries process recognition. in IP going that eFPGA wins hope with to eye those some why everybody, on dollars. And you the already at so

lined that, deliverables weighing we've are being of so predicting. up, that able on that with by deliver for a announce the to up strong couple got So, that I think lot contracts that, of end then teeing year QX the we can those see the win for a things to everybody we can

we first And that So today October. are your taking up early have and then gap part decision companies April, are in that knows of coming right we'll think of of government-funded that funnel have the April and now, be year or say, the of the to is of and now just projects fall government I is fiscal rounds yet, week able Obviously, there, back there ends of enough fact between I'll it's opens proposals going I that sort first XX should of in these those question, for September XX big think new from still but vacations for and the close that the that we're goal in vacations is funding are the these year. to that Richard, still that to some have starting points we decisions. that Part XX. everybody it's not some the these not back making

these funding of So that reins and up them timeframe help? the for that's going the should probably be loosen of to therefore, on sort another some proposals, that accordingly. Does

Richard Shannon

Very fulsome does. Brian. That commentary,

Operator

with And the Yang next comes from Martin Oppenheimer. question

Martin Yang

doing help its on details with more question partnership? maybe to sales impact, CTG increase funnel. should CTG IT impact And you the you potential some just on us licensing what more your looks is to size like a business? expect actually distributor, CTG CTG My on with give is First do the It we accelerate than is fulfillment and functions. Can funnel

Brian C. Faith

yes, accelerate short should last help we is answer to the They're that. question So that. your going to expect

importantly, because is and resources Industrial devices. is help very that. CTG we obsolete they're going funnel part our accelerate qualified sourcing technically that be More going I And before actually Base, involved their one and demand doing they're fulfillment assign demand Defense in with lot in to work both a own of puts position strong creation. business them of think to the opportunities even us a to the to pre-qualification

force work mature announcement. devices we a to obsolete before. lifetime As that to customers by through of we buy to matter CTG to And this, with have stock end-of-life didn't fact, an we some doing wanted supply

a us assurance parts what from really also program. that gives resources. going It their the sort with in for to Defense these we're smooth was our of it that the optimize transition So Industrial directly customers lifetime available are to be of Base supporting

feels Industrial would And think know secure my designs. cycle CTG backbone so, Defense through They with of reputation, to say, and opinion, on life Base working they're but that the sourcing design. I with a I as devices the this going new maintain sort is the of

a I reputation. for of and that programs needs, focused to was my that plan fully I buy that decades. storefront, or a They've knowing them They're a Defense own have and when that device critical great they're the they're great absolutely Base going that to record and stocking about that's looking if these literally Industrial think they this. on custom way and I'm partner all SoC So from do talking plan sourcing a you're got through maintain that run assurance

IP. us, to, of creation dual think fulfillment so, and demand both for And going on and storefront they're again, sort demand do I

Martin Yang

A margin question profiles. on

pretty us, So how should year, think between for we -- for Is different cadence remind can is the items? and it you about even the XQ there OpEx any XQ?

Elias Nader

about asking the right? gross You're margin,

Martin Yang

margin, OpEx. not gross sorry, OpEx,

Elias Nader

of it going about together $X.X Well, OpEx, resulted And just time, like out like in QX, to we it's more on Oh, vendors okay. payment it, flat. I It's were specific had, to for OpEx million, in but simple. like, more -- a we example, wasn't quarter, it's -- mean, think last be counting $XXX,XXX kind still, this but it cash usage, only addition. just We going that and same had happened. kind was came of -- in it all we was

be think or to X still more even hire flat I we quarter-after-quarter. is going it people, if

flat So the I'm year. counting the end on of through it being

Operator

conference I This back like question-and-answer concludes session. to closing to would the any turn for our Faith remarks. Brian

Brian C. Faith

for the and joining you investor one Communications will Semiconductor Internet connect Needham in day. early thanks today of some you participation, Wainwright great we Global Oppenheimer of Investment have XX; again your the H.C. or a for Virtual & including week; at again Conference David, Technology, Conference everybody. us Thanks, our at August events, September. Thank next the Hopefully, Wednesday, upcoming and with SemiCap this &

Operator

attending you presentation. for The today's conference now Thank has concluded.

disconnect. may now You

QuickLogic (QUIK) 13 Aug 242024 Q2 Earnings call transcript