SMTC - Earnings call 4 2022 | Semtech Corporation

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Operator

Greetings. Welcome to Semtech Corporation conference call to discuss the fourth quarter and fiscal year 2022 financial results. Speakers for today's call will be Mohan Maheswaran, Semtech's President and Chief Executive Officer; and Emeka Chukwu, Semtech's Executive Vice President and Chief Financial Officer. Please note, this conference is being recorded. [Operator Instructions] I will now turn the call over to Semtech's Executive Vice President and Chief Financial Officer, Emeka Chukwu.

Emeka Chukwu

Alex. you, Thank and announcing in market release website results issued from include was call results cause The differ statements. to today our and the materially risks that statements closed include results our that is after could will actual anticipated press the forward-looking unaudited uncertainties these available semtech.com. Today's on

the section in and the safe review our a detailed today's release periodic with For press please reports more Factors discussion Exchange the uncertainties, of other and recent most Securities in statement of Commission. these included Risk risks filed harbor and

along respectively. sales Asia, and midpoint constraints. In or contributed $XXX.X COVID team net such As today's comparable record drivers a All a The more undertakes to delivered the non-GAAP measures to of a in the the QX, non-GAAP challenges presented supply X%, call press as and no on engines made financial will EPS and by our behind Europe of in discussion XX% refer sales results growth are $X.XX revenues the fiscal an Fiscal references XX% net facts GAAP unless release. In shipments X% from remarks again while calls Semtech of update useful, company why decrease to with performance detailed of of are the was guidance. than the revenue secular A should to million. otherwise a growth. grew the of the information increase and XX%, to Mohan's 'XX, above record considers America included into most of this financial sequentially reminder, despite current, during $XXX.X such measures rate the year-over-year, represented of comments North XX% prepared million, noted. prepared made to with remarks obligation financial this my strong net reconciliations management financial and change. grew Xx XX% measures today and and 'XX circumstances QX measures only, non-GAAP call our strength today's or of

this our XX% in XX% the distributors approximately net estimated are for over our approximately consumed we direct in the that of Total distribution sales ship-to net approximately China, the balance represented Europe of shipments of Americas, sales represented While and XX%. in the and the addresses customers, sales and XX% world. represented XX% rest

to XX% year, revenues from the end attributable and XX% year, and consumer Approximately XX% mobile prior from XX% total remains and of was and sequentially XX% consumer the quarterly represented total net other of of high-end with industrial to Our of distributor business respectively. In approximately industrial revenues net and QX the the high-end end consumer represented prior total POS systems. over POS the market represented over devices, another coming consumer balanced, was XX% sequentially and the attributable approximately the XX% and fiscal X% high-end record revenues. net from infrastructure, XX% revenues. Net XX% and XX%, decreased revenue 'XX, increased of market markets,

quarterly wireless mix broad-based CDR, end LoRa higher XX and sequentially XX% market PON, enabled, of bookings XG QX for QX by approximately upper and Finally, increased those sequentially total accounted our of of record, the a increased points of X% end the basis QX XX% XX% revenues. prior shipments. range that sequentially PAMX XX.X%, to infrastructure represented the which and new increased a margin Tri-Edge our gross X% bookings and include year growth drivers driven protection guidance products. over industrial XXG our and represented the

higher to by expect operating increased our million continue expect engines. we In a expenses. slightly our strength continued to growth XXX of QX to of points our of reflecting to we expand, fiscal expense XXX margin development trend QX, platforms. basis $XX.X benefit mix 'XX, product For by gross favorable growth new driven to gross from the regional margins higher

expense compensation the increase start to expenses, by due our For typical QX, new at higher is to X% which we of year. calendar expect operating a

ahead basis growth, points margin a progress XX% a XX% record to expect operating XX%, profit and rate Operating towards represented model Looking expanded approximately fiscal and led expense gross represented back of half our to of operating we Xx trend to target the solid towards 'XX, fiscal to target 'XX, higher the operating by of growth. In rate revenue the a grew our profit. margin revenue XX.X% approximately long-term model. XXX

leverage As strong expected, of platform. growth seeing our we structures operating are expected the from

non-GAAP of generation fiscal the million sales, This million and supply flow fiscal was very strong from strategic lower to profit in the the actions constraints. In operating of fiscal higher levels capital. net fiscal of our and and XX% record our our 'XX, tax favorable $XX stock and from due XX% end free our we of maintain outstanding in fiscal resulted increased $XXX we is authorization. 'XX approximately of of around XX% XX% approximately of 'XX. because which than And sales. Cash outstanding year, remaining repurchased operations full a inventory net QX, rate record a 'XX, low XX.X% XXX cash 'XX flow in XX%, strong from regional approximately more a of slightly despite stock. 'XX or sales, good cash expansion income. the of million of target of Our of fiscal in outstanding long-term record cash to X.X% represented basis In repurchased Correspondingly, $XXX working free for XX% demand to flow normalized the point $XXX to mix flow net up XXX% is management million, was was

days. In and days days XX $XX terms days. strategic sequentially, continue We X% pay and XXX sequentially use while of increased down make to our debt. receivable shares, prior line million, inventory repurchase sequentially absolute opportunistically to accounts our in to of with QX, X% expect XX were dollar QX to inventory decreased our days sales quarter cash increased at in the investments net to

to inventory remain record net demand environment. In performance pandemic continued a range chain support supply target the the XXX to of XX summary, tighter pleased days to constraints are we and to fiscal 'XX expect our and deliver the in higher financial chain We very above supply despite headwinds.

record the of in strong drive fiscal a pleased are financial years share planet, see operations. The We record per Tri-Edge long-term year and broad-based gross our fiscal smarter wireless and cash earnings to for sustainable flow engines protection that enable revenue, PON, platforms LoRa-enabled financial over leverage Mohan. believe delivering 'XX. will XG now in performance in We platforms, the PAMX, growth a XXG secular of investment I nature us margin, to a industrial nicely record positions our record from record is model call hand 'XX. technology of another

Mohan Maheswaran

QX of then sequential of afternoon, our will discuss our provide by year the In record, XX.X% of year which for decline, group, and QX revenues. performance our and represented of million everyone. better XX% another was from a total Good outlook fiscal $XXX.X Emeka. performance you, fiscal 'XX, to contributed Signal revenues posted year 'XX, down. I year year Product $X.XX. and than XX% product quarterly QX our seasonality Group 'XX. In margins much Record X.X% QX non-GAAP Thank PON earnings the of prior achieved gross our We to diluted growth. represented Integrity per typical fiscal XX% fiscal fiscal discuss 'XX 'XX and year non-GAAP X% of business of record demand over share grew our net

data Our demand year-end remains center as customers manage soft inventory.

the quarter, data growth from However, expecting QX center nicely in data led in and platform. PAMX significantly QX, our short-reach we increased to center rebound revenues Tri-Edge bookings are by

to expect the FY 'XX data multiple in and in now optical Tri-Edge modules. In and increased to to XXXG, $XX XXXG attain design 'XX, wins move PAMX our we XXX% XXXG XXXG center to continued and increased revenues from customers solutions FY market and PAMX geographies our approximately DSP over have as over more in million, Tri-Edge full Tri-Edge production, share across We new revenue we segments. our triple platform XXXG

now data long-reach market. targeted modules. we XXXG optical parts our approximately addition, at double Tri-Edge our center In The new SAM hyperscale the sampling are platform FRX in

ultra-low our revenue low remains FiberEdge's to enable PON represented our together of We us record from to latency, continued another strength business years. In higher as few higher by FY access will GPON with Tri-Edge's our hyperscale global power, demand and 'XX, data platforms strong. driven quarterly grow QX center are from low next cost that for business continue performance, confident the over bandwidth

is applications, ClearEdge and While PON PMD PON very demand lead of PON growth market PON comprehensive bodes the designed demand, supplier providing service the which device first have believe European to PMD has continues which China we well PMD the PON globally. Semtech recently U.S. XXG announced for most to all family leading for future PON global announced deployments, market, Indian We interface to OLT our to Semtech's XXG the been CDRs. portfolios. providers

increase be As will necessary. PON in the systems integration functions bandwidth, anticipate into modules of we CDR PON that

PON also development PMD that are in technologies We with PAMX leading-edge will our of advanced systems XXG for partner Tri-Edge platform.

over base station result, next of business our few expect continue revenue QX. a wireless to QX flat grow years. In business approximately we FY to the our 'XX, As PON from from was

at XXG X We win to PAMX in optical industry's with Tier several XG the base ClearEdge driver system and recently which at targeted station for Tri-Edge in currently XG vendors. wireless continue is field infrastructure, modules. both new We first fronthaul integrated CDR designs announced trials

we both across expect and enable FY into to believe at driven revenues lowest to underlying should another strength quest Integrity FY our record. on growth expect based 'XX. in to continue 'XX. The the demand In FY to market FY Product Tri-Edge solid the wireless QX, secular power for segments Group witnessed increase our base infrastructure higher wireless XG base we we and 'XX, station momentum and station bandwidth ClearEdge We business by all 'XX, our is wins, the expected deliver quarterly our in Signal deliver in strengthen

of Group. Moving increased of on seasonality from revenues. Demand period fiscal due Protection over Protection total QX XX% our 'XX, last represented the year, and revenue XX% Product same in sequentially, Product QX. our and year Group as X% expected, customers net our to softened to In consumer decreased from

consumer we and expected, our nicely strengthened in bookings to increase QX. protection from as the business market expect However, consumer

year a products QX, from ago. protection XX% In grew from our demand broad-based

range business into broader IoT. automotive Our a and to protection continues including industrial, of segments, communications, diversify

we Semtech's high-performance systems across all with advanced more for chips designers segments. demand increase market to process As use geometries, protection expect

QX broad-based nicely Our year business to revenues In protection our to is 'XX, increase. protection and to gross fiscal margins. our of we contributor expect increasing continues grow a major

In revenues. and increased and Sensing year QX the our the Wireless revenues revenues our quarterly In adoption represented Wireless to applications to XX% of Group in Product Group. total of prior Turning Product from over of IoT as our QX, Sensing 'XX, record continued year fiscal XX% LoRa-enabled another low-power accelerate. LoRa achieved and

several included world quarter, to exciting LoRaWAN areas Space which with the of initiative or cellular announced Wi-Fi. Lacuna a joint the During coverage cases, we the in further use increase without

Microsoft and environmental smarter the with our company leveraging integrated the networks LoRaWAN innovative additional the leveraging to to city a energy citizens. ICT monitoring based a together of LoRaWAN Europe, their new designer Tencent recognized predictive sensor forest in together of connectivity data services into Union, in precision QX, Cloud has fix its And connectivity and and data-centric sensors ITU. China Cloud, with electricity, is Telecommunications analytics was Cary monitor International's power provide LoRa levels monitor services International enable Carolina it as distributor Elvexys, distribution are a a XG Cloud from of better in geolocation failures. Also leveraging on protocol urban in community SCADA of The transport leading officially to flood announced, OIKEN, system integration platform. SAS, into and global and the North to approach. integrator switch LoRaWAN are LoRaWAN Tencent by Azure standard system a existing grid

smarter, is 'XX, more from platforms power on power, enable billions range global year to connection this sensing proximity revenue powerful We our users expected and more planet. In enabling sensors wearable of to protecting seasonal enable and lower of more stringent network due manufacturers. and RF expected expect connected the interoperability increasingly flexibility of targeted fiscal enable strong and first drive from LoRaWAN. radio half. are recognition QX long sustainable low demand of the to smartphone massive a softened LoRa's as to scaling requirements radios Global following regulations at

We proximity few in devices the expect will these years. of as fiscal year, which regulations next the end expansion on this sensing benefit proliferate an over towards Asia XG business our mobile

Sensing and quarter 'XX, from our year net fiscal deliver by of we our QX business. revenues record Group LoRa to Product another Wireless and For expect increase led

XX X,XXX design QX new wins. products fiscal Moving design and achieved we released In wins. and new year 'XX, on products to new

'XX, let record XX% also strength XX Now driven briefly all me product and a from to PON year XX% of net FY design performance. In $XXX representing In business fiscal revenues wins Products increased revenues. over releases record XX,XXX, our the 'XX record we by million, had achieve of 'XX, Integrity year a prior new 'XX, increase on groups. fiscal comment from achieved our to our number remained demand a to infrastructure grew FY of year. In the leading year prior XX% Global record strong, revenues. Signal product

for station from strong in and Product by hyperscale deliver achieved grew market FY Signal from Group record record Tri-Edge the grew the prior FY new to continued PAMX driven base strength achieve group XX% over growth products 'XX, PON to in our by wireless product and which Integrity broad-based SIP business protection center bookings record. another Our our XG year, 'XX, driven the expect market our protection a FY data XX% and we business, market. In 'XX our revenue

for consumer our and protection needs the the automotive, protection demand as broad-based continue businesses segments. to Semtech in both expect IoT infrastructure, economy drive the of our grow to products circular protection We consumer and strong

to double-digit again, FY deliver achieve our We protection 'XX. 'XX expect in FY record business in revenues growth, and

'XX, our prior achieved year XX% Sensing In record revenues. over and FY the and grew business Wireless

business to FY continued our make metrics annually LoRa-enabled we have on In Our 'XX, XX% record progress solid LoRa revenues growth million. to established. the $XXX grew a

of at the from LoRa 'XX These operators metrics of number end FY in network to The included: grew XXX FY XXX 'XX.

at The the LoRa end We million by gateways expect million end 'XX. FY number of gateways the to operators 'XX. X.X 'XX XXX LoRa increased FY of FY network in deployed X.X XXX% of from

to to We expect X deployed increase the the by number end over of FY LoRa of gateways million 'XX.

increase this deployments on versus FY Amazon over picocell is range increased being gateway the the large XXX% broad deployments campus We in gateways enable gateway and as critical are deployed 'XX. that cases increased smart globally. gateway the use XXX% emerging. Picocell industry delighted increase versus with to lower deployments over Sidewalk infrastructure segments. driven is of home FY smart This in And by 'XX. are

deployment few end 'XX. drive an years. In Sidewalk should addition, Helium nicely the in fast next networks FY the peoples' and accelerate very network, over Helium growing and deployments should Both in device is acceleration

And smart In should driven FY picocell 'XX. endpoint our deployed rapid of to deployments of number addition and macro from to smart gateway increased a million years. deployments The the initiatives also deployments, XX% at over 'XX, end infrastructure increase by globally. 'XX logistics of at XXX end the drive smart city this acceleration the million next LoRa cumulative increased over end in XXX nodes FY few utility, FY

includes node nodes to opportunity We over deployments at end to LoRa expect expansion ended number the network the XX% $XXX XX% the leads, we years. The X currently XXX 'XX With approximately will and time cumulative a deployments exceed end the next million of over convert expect in X this anticipate to both million. to real continued FY average, 'XX. We that, to opportunities globally, pipeline pipeline, XX-month end rapidly on FY of line. by which accelerate opportunities

and At FY logistics total use IoT, to Our smart the asset with exceed smart billion. utilities, anticipating smart $X.X 'XX, pipeline cases opportunity we in remains opportunity pipeline balanced smart primarily well home are and cities. of industrial tracking, our end

several anticipate our another we record For FY years. business CAGR LoRa-enabled from our the and a business XX% expecting next are for 'XX, LoRa over year

record Wireless 'XX. in We FY expect to achieve our Product Group another and revenue Sensing also

Now of let our first outlook fiscal the discuss year quarter 'XX. for me

and in QX. terms the Following the orders backlog, QX QX $XXX with net or attain to million be and $XXX between strong are very at record guidance million. of midpoint of revenues needed X entering the we estimating QX our approximately To beginning bookings we range, million, currently $XXX

be We to Emeka answer any to per Operator? earnings happy hand will I and and be the $X.XX $X.XX the back expect diluted our now share. I between operator, QX and will questions. non-GAAP call to

Operator

[Operator Our Svanberg comes line from first the Instructions] of Stifel. with Tore question

Tore Svanberg

record the few them. metrics, all quite on a of Congratulations

basis Signal question, mix. expand that year, that Group primarily XXX XXX this you're show will to we First that, and expecting to Should points Integrity attributed strongest growth infer by margin to gross you this the the year?

Emeka Chukwu

Sorry, section can of you the last your repeat question?

Tore Svanberg

Yes.

the growth show Given year? about Signal Integrity the mix your this comments expanding and will infer we margin that strongest year, this should Group gross

Emeka Chukwu

We showed the growth. strongest

think... I

Tore Svanberg

Among the groups, right...

Emeka Chukwu

terms nicely. in growth. with and think grow I our expect going dollars XXG nicely leading platform platform groups Signal absolute should still we very to LoRa-enabled our all is to do Tri-Edge way us. of very the grow of probably Integrity The for

to way know year-over-year both Tri-Edge, Signal PON, growth. the to don't of I going think they are in XXG I but it's probably be the So that going LoRa, a Integrity the terms lead

Mohan Maheswaran

the protection, And in ITA business Tore.

we get certainly broad-based So that gross more protection margins. drives higher also business, as

Tore Svanberg

for that those hoping Mohan, a at on good. quarterly I'm of consumer X I that's the also picocell to number around, mean sort in us I LoRa. And Very deployment. into really the could give sort world. us technology growth metrics time us this yes, this you revenue the gave is assuming why indication of you an now And gave a you was more elaborate call? just decided you moving But for

Mohan Maheswaran

of types home and large driven industrial, smart not of but smart segments, and the campus. but metrics is macro. more volume little start picocell that say picocells a giving the by on break tend gotten to buildings. I gateway now Well, those It's felt into out number cities such large does been doesn't to the the and smart we'll deployments, the The macro it's bit be part out gateway, I've a go smart smart to to picocell utilities and a

obviously, we'll of said try that the So terms do And grow quarterly course, give But We'll I we an wanted XX%. think because that. I number. that to continue we're of least CAGR. against that get won't lot. And out we going we how give for question of about to provide the We annual color a the number, we XX%. number, XX% doing indication grew talk in quarterly to at then were to

that And wanted information share to with so you. we

Operator

Our the Gerra of line Baird. next Tristan from question comes with

Tristan Gerra

year-over-year. over show you In the think I the working terms increase of so pipeline, provided, XX% a numbers

well? So also, quarter is LoRa this us that know could exposure last year. your how has prior range in in revenue of we year I as China for you you remind for if the tracking should at And revenue looking LoRa be that business, have in been kind say, of, XX% which

Mohan Maheswaran

Yes.

start opportunity in China been about pipeline, me of But XX%. Tristan, that. about with pipeline. of as more It's Let terms XX% is balanced we've much revenue. the saying, the it's

Now is also range. North America that in

distributors, OEMs then from funnel terms So them revenue the deployment their is -- networks. ship we them -- is and in and still ship correlate then of guys And the them module a but we to gateway we revenue to when build China. sometimes deployments, you really timing ship module ship When to of products, XX% then and standpoint, can't hardware and because opportunity providers, -- distributors the deploy different. these OEMs

actually versus timing. it's the it's metrics part actual So exact timing out when the these why exactly for is of different, these give determine and deployments that revenues see occur, difficult to and deployments the the we when of us the reason we

an give which that the indication each of think what's we nicely, is areas are So growing important. I

Tristan Gerra

you're is your talk business in about about Okay. smartphone, half seeing then most that, follow-up, China. wanted that of and a to Great. I little given bit China what I of believe, consumer is for my And

quarters? to down How but it's understand China terms impact those inventory also China happen LoRa what mix, you've business? I the something come rebound. what -- couple as smartphone this that correction Now in your risk a that seeing And in the expect LoRa consumer to of in the are could still over inventories business? And percentage of of has that is you the inventory your you said next XX%. -- continues potentially that is

near-term a So is the for headwind that few kind you think can next quarters? of that of

Mohan Maheswaran

obviously it all we demand Well, areas groups. to is is so And is all the still China demand product monitor for today, strong. important as consumption very us still business, strong, of

in There's particular nothing our I any weakness to segments, think. indicate

mentioned was With down. I the typically is demand, and consumer QX -- was down

strong the not of in second was consumer. so half 'XX FY And for

So have and have bookings increased, improved. --

expecting a little So in the half. first a bit we are of rebound

think, think but not world we for all half events. and But is China, I certainly really only first demand not the the in the any for second the the macro the anticipating terms question, I for are of of rest half, big issues.

Operator

with the comes line Ellis next from Our B. Riley. of question Craig

Craig Ellis

on I Mohan. wanted follow come back this do and up to LoRa it and way,

a were the LoRa and you the year strong then we seem think X it the So build and fiscal quarter. about to has over really quarter quarters, momentum rewind about that have last to very gained clock did fourth very, each the

given question has last materially So growth degree the fourth potential to why seeing year? fiscal exiting we be wouldn't the growth that But we quarter 'XX, know fiscal I the the for perhaps in is we're 'XX, this. company retains the year-on-year same potentially and had level above some my target. did for XX% XX% time

Mohan Maheswaran

would the say, it's than to exactly, I other time Craig, revenues. difficult reason, No

sometimes of I terms of deployed being in end deployments the are things being nodes gets deployed and momentum network As ahead when like use that. mentioned, and cases

did And we're model. and opportunities conversion of opportunities, design our is real types out. And revenue growth the and at I those There's we to higher. we look of had in X terms for for we that the metrics funnel how XX% we funnel, X opportunity XX% significantly good next So XX%, suggest think to fiscal deployments. 'XX. year, our a last that is outlook given number opportunity did looking the the drives is similar have years, a we Obviously, a remember, laying so the good but in feel the anticipated we nothing won't very into of different about, really that's FY year, real what

Craig Ellis

should I Nice guys. about for Very it. I if returns. you see that to helpful. and congratulate to coverage, another X backlog quarter's Emeka, revenue don't guidance then I And Emeka But item. of it a actually kind it's But wanted or flip line require having to talk know Got you that

margin get So that very or But the about. the is. excuse Tore helpful color gross question my to -- asked me, 'XX fiscal

So look last XX if improvement X material we've we at 'XX basis the to points would I just quarters, or margin here the and gross imply, for XX from sequential X think, very color fiscal had through the year.

So to mix not on gross trailing that what's materially quarters? more implied over X within would happening why caused or moderate something margins X that expand instead the the in stay guidance? and so And to it that's pace

Emeka Chukwu

Yes.

high been for that markets saying So we've to a of lot expect Craig, we been expect also the to I ITA very that beginning our pleasing XXG LoRa-enabled, into very very that to That we gross to grow have margins. going think businesses. that investments very PON, a industrial out, and is And pleasing protection play it see. have and fast actually while this is the see really to

we 'XX, saw again the have we But points. in expansion XXX why duplicate of nothing 'XX. we XXX guidance basis cannot And that There points go XXX basis in FY about to forward see. says that FY As gross year-over-year. to is that for margin that's we

and don't the what Ukraine, things to there. how is the chain be play out, see to that continue just are with impact will things is -- supply I we We still there we heat have especially feeling that the know in gross to we war going out margin have see already expectation things of on like see is a lot the expansion. But that. mean, to

excited see margin story. with and but So gross we're. we'll very Very hopeful our

Operator

the from comes Bolton question line of Quinn Needham Company. & next Our with

Quinn Bolton

And Craig's congratulations math, just well. the full do I'll of gave on us my LoRa. offer I you the follow-up really If question you year, year, as was the sort to I the first guess looks quarter. It of X it the was fourth for of quarters like closer us quarter the to LoRa XX%. the XX.X%, and average gave fourth in a

So the Mohan, driven continued it was wondering, Is nodes? that particular a fourth LoRa give And can that in use dramatic just Is acceleration some by us just there are quarter? the looks you a the case? I'm acceleration in in you like if Or end quarter. What seeing it pretty deployments? gateway sense. drove fourth really business

Mohan Maheswaran

Quinn, I the say, Yes. at infrastructure. this would moment, more it's

at the that's driving moment, which infrastructure good unexpected. this deployed. to that the think I end And tough the for is news, is gateways, then follow, of is not more is it. But But to expect us, So timing being we'd yes, call. nodes which

were couple I $XX you a years a running million back a now to of mean, go quarter. running if closer at ago, we $XX million and quarter, we're

a LoRa it's And really trending so going it's a been mean, expand. I We're has use alliance, infrastructure us. We're the Azure, trending not types of macro real also now upwards. ecosystem cases Microsoft companies in in And by have seeing been the really drive Amazon, it's LoRa that seeing big companies. We upwards to but mistake. number starting ecosystem as are now for gateways, in of increased the gateways, Alliance deployments, IoT cases. the well use players

-- we're it moving generate direction. we just into It's for is the right we've while, a whole now. of cases, tags that like starting use it, in going And change revenue question across that place, a some in of is machine by starting like really but that's deployments. And and time. ITU. We I said it's pointed translating us, the drives to ITU, can remember That's -- happen. just whole globe really So to now the to as being LoRaWAN standard see good I agreements to globe recognized starting our the now see mentioned that, out LoRaWAN look well really, the things is roaming deployments networks. been and across cases about haven't for right? But which product these so longer, the get different we're use significant there. We're take the you thing The interoperability deployed. if in of ship the been and little because LoRa And that I we picocell -- customers, there's bit -- now the to and types is talking ITU infrastructure monitoring very now, use and because that knowing then think it the when there a

So exciting see very to that.

Quinn Bolton

matter of we but time before applications, designed of the exact nodes those And mentioned nodes driving feel into that follow-up and those timing 'XX. the network, meaningful particular have you on start I are end was, I maybe and to not those you nodes that Do being the had fiscal end the pretty to the confident some of sort end Helium gateway deployments a guess of ramp, it's networks? line of see in Sidewalk X just believe do in of a you pickup sort sight

Mohan Maheswaran

is know, what be the end would in have infrastructure Well, there nodes don't place. we I no Quinn, if that

and think I gateways I deployed, around to to starting years. being few it. get infrastructure sensors pretty in the going now it's take the I going a happen infrastructure is feel So don't and something and overnight. are developed networks, going -- for about that's it's going think the are these to in But confident

it high cases type And type might of that the this of very take is In time. very, -- are very quickly. can some other volumes cases, use drive these

lot of a mentioned, I network. density cases of use need as So

and drive And as by networks into come use of type having does it agreements so these roaming cases. place, different

years think next see, over the which here. that think factor of exciting that's we're couple see I will yet I we So the to

Operator

Our with comes Rich from Schafer the next question Oppenheimer. of line

Richard Schafer

congratulations, Yes. I'll guys. my add

of to about Mohan, Just licensing think your I on long-term model. And a and follow-up sort you need business. you type more shift that sort of silicon in spoken revenue about past and -- curious consider up I were to if you've But primary talked away other LoRa. LoRa. that source And plans see opening metrics LoRa for as of just a your standard royalty a as making there maybe what moving of from to for the was

I'm -- on still it's so over revenue think coming think from XX% I of correct if or I the chip -- wrong, me the still side.

how of of or business. you're in is kind that of curious the thinking just of million when sort target X years to $XXX we X get next -- about your So kind or sort that

Mohan Maheswaran

today most Rick, all, -- And So first good yes, sales. of the of is ship yes, that's question. just revenue a

more that starting the is LoRa to my discussion recurring we days, million and a That's a is on then our but I've starting a We started. we said. We'll It at Edge to is to chip that services prepared get But grow. years, our platform off about in the just more cloud -- -- cloud with really remarks a we are the we I probably that but come little see to X starting IP Tencent get royalties driver revenues, China. at And separately. we to based think signed business ways relationship can have which revenues. $XXX least it's really now and if I what the yet we're services of We're cloud businesses to goal can in that key just like see years. on look mentioned chip X to start early bit. The business that trigger revenues look relationships has at

Richard Schafer

on million a I business there about now really for taking are mean, I that at this on mean, lot then the that I of point said, I mean seems business. sort it think that million, $XX of like to we've And off. for $XX talked tipping know Tri-Edge, be were be needed I to the you sort I thanks expected. last years. mean, business? year, any we mean, of just obvious that that couple overcome? hurdles in I color

guess, in look it do you PAMX? terms And there, how do analog of the -- I how size you opportunity at for market like

Mohan Maheswaran

here -- we Tri-Edge. good the have Well, until PAMX products really that any is were didn't we Yes. news

there. little out were solutions the behind we so DSP a bit And

I in all gains space, And us for so this I way the at think, share look it's it.

be to And power our but we knew is customers about care power knew that XXG going consumption products, so first about with PAMX also and short-reach we reach, cost. extremely the beneficial on that an had limitations center we data to cared

range, FRX see momentum And have this as up in whole the in opens a we're longer-reach reach we're for is of that to well. sampling now starting now quite short area a kind X-km products by And center few just modules, and really space obviously, excited that. us, mentioned, developments for which the we data I side. And so we're XXXG which as the

over to to few very for -- the So data us be and more strong exciting, quite come. next yes, But center years. the we expect

Operator

Wells question the with comes Gary Our next Mobley from of line Fargo.

Gary Mobley

well? your If you your ported midpoint about would in it's Or increase purchase from of as of point expect I revenue look at sale guide, at QX to know if the growth. commensurate Curious X.X% increase? sequential that's all a benefiting

Mohan Maheswaran

also record expecting the us we and another of point QX. at for are sale So is moment, in records

ASP at yes, So our And pass tied POS that. to the with that do on Gary, we're -- expect it in increase Yes, increases. to question, about think way your is get, type of But we correlation moment, customers. the to we'll cost we thinking increases any I was

Gary Mobley

of mean, increasing? I it if so some I a would more encapsulate price really distributor Yes. it I guess was was inventory increases. function asking

Mohan Maheswaran

No.

I strong. think very is our POS

record. -- have moment. mentioned the we supply very time extended And changed, at As the on they a call, not times it's cycle chain are cycle

our has so increasing, our good the And a think increasing, in increase expect also the bit. as as is shape. little I long I you'll channel of words, then is at the other consumption But we're POS see internal to in inventory inventory end increased. day,

Gary Mobley

been not with the running to the levels Okay. industry guys it? historical that DOI constraints. in the clarify, And up how escape And were quarter-over-quarter with is your -- you're have you and with that's really to increase able quarter-over-quarter? supply situation, XX% say supply, XX-day with else you the did above just dealing related Emeka, if everybody you while to did bookings And this any I presume -- dealing others in

Emeka Chukwu

Yes.

back here, couple platforms go start now. I we to the prior are -- we if we to seeing of these actually anticipating So product that of new are ramp years -- pandemic probably some had a seeing of the

in up. lined So pay all supply And we have make all our we and that second to stuff sources some attention cases, we did sure chain.

in are fortunate that already we regard with the very good So position were chain. in when very the to pandemic a we supply hit,

to that average, very I that are we a know levels in support So demand a we've I think inventory where able and on very strong supply very lot well, the pleased don't any point. see It I we think. with that at but that position of this mean there our the good to we are we're are, here little pockets all. are doesn't constraints are seeing managed and, have at

Operator

Thank you.

question Tore follow Stifel. with is a from next Svanberg Our

Tore Svanberg

year It had at you was in a specifically pretty relation that impressive just has especially products And the Mohan, a follow-up a lineup. bit all introduced volatile, on PON, I be market been of that OFC. going question that to always into to because as with new about your growth. that How we go for second China, market your think products fiscal I consecutive we strong is but should and think 'XX? market very this

Mohan Maheswaran

observation were say, access Yes. in a And become more there is your exactly bottlenecks I what's totally look totally and a I clearly the the side. Tore, space right. different really now. bandwidth, pandemic has access at think we would When pandemic. It's is the different drove market. that PON what driven

that. good demonstrate really think has way demonstrated a to problem. to is I PON so And solve that that and China continues And

rest accept the now also of world to the that. started has But

starting and access at And really North and to India, bandwidth. regions America, so seeing as key we're as look other mentioned, I the Europe PON

that's the really gross is exciting in margins, we've as are modules, intriguing on PON, ONU PON. into We've and as obviously, very XXG we mentioned of acceleration for And us, other likely an seen seen of side. And XXG is remarks, And well. both acceleration then the helping for thing will -- so my XXG us, GPON. functionality and I the prepared an expansion CDR need which also OLT PON. Obviously, playing,

in We're side. obviously opens that So up more content PMD leaders us. for

the of CDRs. in one leaders We're

very, in the gives and And developments mentioned, through combination PON even so XXG position a there. very we at have us even we're And X -- good of PON. I

is very good years, get that would for to in space to probably a lot -- generally, I I to be is investment exciting now X So in, this the going say, suspect. next of space XX a and a

Operator

now for remarks. closing end question-and-answer and of Ladies and call session, over reached have turn the Maheswaran gentlemen, to Mohan we the will the I

Mohan Maheswaran

pandemic pleased and were we QX record year our the and supply business maintain in results. strong infrastructure our and operations. chain our believe initiatives has and best-in-class In tools 'XX us closing, enabled multi-sourcing fiscal we Despite investments with to environment, challenging

next deliver Semtech. With mobility Semtech of continued support expect are year you targeted record for Thank look a infrastructure, enabling you. engines very and another we quarter. broadband growth key and all creating your appreciate doing to Our planet a to forward all well 'XX that, smarter we and updating FY

Operator

disconnect Thank day. have wonderful and your lines you time. concludes may this This you and today's conference, at a participation, your for

Semtech (SMTC) 16 Mar 222022 Q4 Earnings call transcript