Applied Optoelectronics (AAOI) 22 Feb 242023 Q4 Earnings call transcript

Good afternoon. I will be your conference operator. At this time, I would like to welcome everyone to Applied Optoelectronics Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator Instructions] Please note, this call is being recorded.

I would now like to turn the call over to Lindsay Savarese, Investor Relations for AOI. Ms. begin. may you please Savarese,

After call Thank and you. I website Fourth found for Optoelectronics. and is recording announcing Conference Investor and issued its today, a release provided the press year recorded is XXXX. also will at for Lindsay year. first pleased to ao-inc.com. of the XXXX Savarese, on release can Investor be Call. Results for live. am This outlook webcast Financial AOI's X and section fourth Year The Relations market company's being the and welcome AOI closed A Full on AOI quarter available quarter Applied its to XXXX I'm the website the archived full you Relations Quarter of results to link the be financial

Dr. us overview outlook Stefan Chief Murray, Lin, financial the Thompson for AOI's call remarks. Founder, question-and-answer Officer Stefan details quarter XXXX. session prepared will Thompson the Financial give A today's and Officer. Joining follow and Dr. will results, of AOI's and and and AOI's Strategy QX our will on and is provide CEO; first Chairman of Chief an

actual or believe, you potential begin, and current forward-looking call, expectations, or statements should, which future similar expects, to cases, to expressions outcomes. Before convey to or levels by differ events or such could, as its suggest, intends, may, terms or you the forward-looking industry predicts, other cause On assumptions that identify of by In activity, as forecast, would, expressed statements. estimates, in some materially those results, will, those statements company's negative company uncertainties of achievements well thinks implied These anticipate, from of terminology AOI's uncertainty the like or I such involve as statement. we plans, can forward-looking management safe harbor would statements. performance review make remind or today's will risks or the and could forward-looking

projections. company The its on and forward-looking assumptions, estimates these based has statements current expectations,

expectations, reasonable, involve believes and and uncertainties, statements of control. the company's are estimates predictions the and and unknown are many risks beyond assumptions, While which projections known company are forward-looking these such only

to may company's this management the to of to obligation statements of earnings changes the company's any markets reports required these expectations by on and about the call reason also first regarding Risk beliefs other information the date the quarterly conform for to products the expectations. responses on we and as innovations impact Except on risks statements the the XXXX. SEC, the annual expansion regarding update into quarter with file the of our as in including for related of set XX-Q. statements statements are XX-K include that customer report forth reports assume in reach to outlook our business company's actual after company's statements company's Factors no Form section Forward-looking company's the of results, well Form the new law, [indiscernible] More and forward-looking as

measures Non-GAAP GAAP. financial substitute a and non-GAAP call XXXX or on like basis, currently results financial noted our in I'd a are between specifically unless other website. earnings available press on our as first measures in well release is financial for discussed and are results of note the included that earnings as today why prepared for measures May isolation is a as otherwise. XXXX. quarter scheduled non-GAAP date discussion X, present GAAP to financial intended all Also, we accordance to of our in considered not with our reconciliation are be measures non-GAAP A

would Thompson Applied and Lin, like Dr. Optoelectronics' CEO. turn Founder, to Chairman over I to Thompson? Now, call the

call our joining for you thank and Lindsay, you, Thank today.

expectations, our our While to in our our came EPS outperformed of the gross fourth our end expectations. projections, non-GAAP high bidding margin below at quarter revenue

are by income which we generated in combined years. time quarter gross for many have the progress QX. adjusted fourth allow with million positive improving [indiscernible] margin, made our generate our of the in the us continued to [indiscernible] small $X.X in pleased Further, a in We expense we EBITDA management

in non-GAAP is quarterly our During mainly improved X to as nonrecurring revenue gross the center million some quarter. fourth XX.X% delivered and lower delivered above in last we projects. mix engineering to below our of generated was XX%, somewhat $XX.X product guidance demand data margin began quarter, primarily million, the of was we range we million, gross revenue the of some range expected by and to We of $XX see which contribution highest which guidance $XX years than softness in to led margin that from XX.X%, have driven due

of XXXG We X.X. $X.XX. XX% more [indiscernible] high than details of generated the more year-over-year, Total of transition of as to at a for income prepares and Stefan? sequentially, over turn With $X.XX share, than increased CATV X% slow largely equipment generally Xx QX X.X sequentially. of to earnings more by end Total for QX. in [indiscernible] was XXXG our to revenue small call for and outlook a the of million, year-over-year our revenue of center sales the was and $X.XX will for I data period. segment guidance performance the up $XX.X review non-GAAP was same double revenue that, for per million, our to was Stefan down driven $XX.X industry products year-over-year the our which products loss doubled Revenue of net but our products our down than range which in XX%

Thompson. you, Thank

quarter many in the on made margin, management, net our fourth for generate have We're in As time combined our expectations, non-GAAP our projections, which at our below the expense margin in our to expectations. to non-GAAP by gross Thompson allowed our of high we pleased outperformed the gross small fourth with progress EPS our revenue while mentioned, continued quarter improving us first came leading end a a income years. the

Further, we QX. EBITDA $X.X of million generated positive adjusted in

the Asian do improved Year scheduled New holiday more we XXXG a expect we we the take see in revenue seeing in data in customers contribute in us one the for half of new the with basis both to these starting we have begin QX effect, softness year. are which to are second traction customers despite of strong start currently of Lunar we due expect the to optimistic products, meaningfully QX, XXXG are a price a gives anticipating been for with effects Despite recently, several QX our significant to experiencing or factories markedly which QX, While some recovery to some and along in center reductions, softness slow and to and combined XXXX. the outlook

to XXXX. contribute move revenue likely not optimistic in meaningfully we terabit are XXXX, very into also about our While to as we products X.X

improvement our second currently profitability expect we the full XXXX. since the expect in of half, year With first non-GAAP we

to the Turning quarter.

Our total revenue to million was for by the to of million, our year-over-year decreased $XX range fourth guidance $XX X% $XX.X below million. quarter which

we we As Thompson softness data late mentioned, demand lower-than-expected orders. this to quarter, as was the of largely in in due to began timing attribute which to center some see somewhat revenue

products our was quarter, $XX.X XX% the our from fourth up down telecom X% our data revenue CATV other. was which quarter in FTTH, with In year-over-year our sequentially. line expectations, fourth the revenue the XX% from During million. CATV and center was remaining XX% was with and of from products, XX%

We that in QX. CATV in saw are our sequential by the encouraged growth business we

in and Looking compared the down forward, XXXX historic we we next-generation highs our to continue XXXX business near-term saw MSOs expect to the CATV that to transition will be architecture. as

X.X amplifier take major to are place test in and We our MSOs to optimistic X half will year. of sometime of anticipate QX. shipped this initial the in the begin products second about transition mid-XXXX We samples gigahertz

feedback various complete. While on pricing the these performance to is currently this qualification extremely products year amplifier expect and units April June their shipping the we We is qualification are between and early and of begin shortly samples, revenue anticipate final after sample encouraging. received

DOCSIS a required last technologies for elements believe enable leader upgrade carefully networks, of we products Further, to for X.X. are our network amplifiers will and X.X. in that we plans and the we aptly DOCSIS deployment that monitor continue are quarter, to MSO to confident As is AOI we other stated continue to DOCSIS X.X designed

data Turning business. to center our

which In the above. was center our data XXXG from data at doubled XXG came QX revenue noted XXXG our from X% our and center from and XXXG X% quarter, of in million, than year-over-year more XX% and transceiver $XX.X Our fourth as products, was products, was sequentially our was products. revenue XX% down

compute XX% we we our XXXG believe for sequentially, by had AI XXXG for sequentially. increased is demand driven largely Revenue our anticipated, As products which XX% and revenue infrastructure. XXXG products decreased for

signed beyond, we for we few As data laser discussed to have development for Microsoft a X with XXXX, next-generation and optical prior and as development calls, including in XXXG on program for center earnings agreements our XXXG next-generation its and cables. active of make a its the reminder,

saw guaranteed, peak longer product not the a these revenue may revenue duration greater contribution the believe than could and $XXX which the we customer cycle, to exceed that build-outs. While this several from these for our the years suggests be and XXG opportunity products that during from continue XXXG products over revenue of XXXG million we of the

We we these than to to and ramp products, during prior a and to from expedite expect shipped I'm the had received earnings expected, and rate began continue Microsoft to as QX. our accommodate. centers to the we although report work in QX, we -- we were able production to QX we on at earlier in call, slower discussed During request pleased which optics for our December data shipments ship as install

additional then in expect later the beyond. resume online to We for capacity coming QX and with quarter demand

value have our includes X operators, to proposition data with strong We our qualify in customers note, received data several shipped with of samples our XXXG we products. we we believe products. and evaluate on other different and as our and positive to to them technology Another products. center XXXX that item just feedback XXXG initial to center offer is the This are Microsoft that working

XXXG QX We expect shipments in year. to of begin this

segment. to products turning year-over-year in million driven demand, from Revenue largely X% softness our in XG XX% particularly $X.X sequentially, China. Telecom down of by telecom was down and our Now ongoing

fluctuate expect levels. current we sales telecom ahead, to around Looking

X greater our our quarter, X and QX and in of customers year. fourth revenue, CATV XX% than X XX% data XX% up We in respectively. which last represented had of the For market XX% center market, from in total revenue, customers, the XX contributed the of XX% top

and the In QX gross of of margin QX, XX.X% up we XXXX. was and XXXX XX%, and generated range guidance sales from business that transition which favorable product our in to of goal sales from We up of XX.X%, to gross XX.X% quarter. long-term committed was around model driven to XX% to in the QX in CATV of remain our achievable. shift, and mainly nonrecurring the margin direct XX.X% impact engineering mix increase is our in believe gross of non-GAAP margin The was a our goal above this returning by during

last were QX direct late fourth our which expenses line $XX of or year. meaningfully revenue, prior operating the As our margins business of $XX.X implemented revenue sales were a compared in Total million to and than our year, quarter in XX.X% with million average. we reminder, the expectations we higher XX.X% expect of or in non-GAAP MSO the be with model to in historical CATV

of time $XX Looking $XX.X X.X products. data improve R&D acceleration million operating market from center range to reflecting non-GAAP expect XXXG we expenses some to expenses million for to our and terabit to per quarter ahead,

range was non-GAAP fourth income $X.X the an QX prior to or year. in a net operating basic $X.XX of basic million for in to of $X.X compares loss net $XX.X per QX This million or loss quarter share a million of $X.XX to loss a a in per share. of our of $X.X year. GAAP with income of QX Non-GAAP QX loss $X.X of to a of was the range profit of a million $XX.X per loss in high the a compared in at for the range $X.XX loss or basis, $X.XX of net share end QX of basic of in On million share. compared and per per XXXX. prior per $X.XX million a of share $X.X our the loss loss million was or guidance operating $X.XX earnings of basic GAAP which $X.X guidance net a loss was million above of share

outstanding shares used $XX.X QX diluted fully per million. the share computing for The were earnings in

million This cash total equivalents, $XX.X of with We Turning quarter compares the ended end successfully balance million million The restricted the now of fourth rate of during to debt end will quarter Notably, the senior We year. interest last the in at $XX.X this $XX.X the year. convertible quarter. issued due short-term we fourth XXXX. cash, compared and with of excluding to total quarter bear third convertible $XX.X an debt, cash. notes of per quarter, notes sheet. the the investments X.XX% at $XX.X ended of with million million

repurchased we Concurrently or XXXX exchanged approximately with the notes. offering, of all our

December fourth $XX.X capital had equipment. mainly production quarter, XX, in compared million the a We $XX.X total million investments of end $X.X million we of made used the in and inventory to was which of QX. As R&D for in at

our outlook. QX to now Moving

Non-GAAP the million gross expected to net loss approximately per in revenue million to using We shares. and and expect the basic share million $X.XX share be of XX%. a average million share $XX.X is loss of XX% range non-GAAP be $XX margin weighted and to $XX in non-GAAP QX to per basic be between per of count range basic share between to $XX.X million $X.XX XX.X and

that, to the for will it Q&A over back session. With Operator? the operator I turn

from with James. Leopold Raymond Simon [Operator first question Our Instructions] comes

A to wanted Great. I things couple unpack. of

is calendar folks XXXX, understand Microsoft from insight over of level how some in us, as ramp to Is contribution spread the help to how expected to from value element size through sort the total offer of that project could set to you as or and may some it's year? this the there which think, understand I you've the opportunity years. of One given Microsoft

it point, mean, haven't we this out project. really customer lot I but the on at to ramp. it of that Obviously, details given is mean, a sensitive, Yes. I started

or in shipped was actually schedule. As ahead I which to noted expected deploy installed where data in center longer the centers -- we transceivers product mean, getting bit little individual of in our a prepared center. are those data remarks, I the those December, taken than The data

lull on. We'll we later probably year. data a of of we after resume bit in right more now results ramp goes the to centers. expect a while tranche ramp and that of forecast to being this the quarter the this there's So the start And have terms then adopted in first see say to longer-term throughout in

$XXX Yes. envisioned that next year $XXX guess trying that million And that. $XXX I this we're verify is to that I'm impression at something sort think want ramps in of of are get what gradually is I I the this that have folks XXXX. million is what $XXX after have understanding kind there to you're rate, million describing that to year, the some year run is but million not reasonable. and getting my I to

process. call, think said I it thought Yes. is What the I accurate. No, same is we that be this said have that's -- last earnings will on

$XXX Now a that we per think support year. not on would ramping starting million be off that it but exit that the will to year, it's clearly year rate the run

X of million. be $XXX over integrate not the quarters will out we to So year

helpful. I. exactly what That's That's

out in years. in than more it course, will per year $XXX those [indiscernible] million which that would other imply, years, the yes, of be

No, trying was then in cases industry the the And and what's what overall connections. applications, terms of out XXX-gig pull it Yes. seems for if on going that's use as to I a there. calling are AI-related of lot in

cases? back-end other are Or they? And wondering, I'm so so, being applications? what if are you are products use used XXX-gig in seeing AI your And there

switch AI mean and supporting use primarily. AI but it's cluster connections sure the what the Yes, quite GPU and and supporting between you back-end cases, by not I'm the

to. isn't Microsoft are to non-AI operators building precisely it's in me non-AI what used center right really -- that mean Now, It's well. other also which as and information AI the to there AI out being applications compute being it's clear that there. other used non-AI other others think we're not versus AI applications applications privy extent certainly, are data infrastructure I around I likely the mean I But is now. primarily large in

I in that think it majority to would is expect reasonable AI deployed would the So of vast be infrastructure. I -- being it

it of is your that interpretation step my or seems color you half as of then the the a to us stronger better, your of year. function on was the what little how a cable suggestion you're bit in quarter do last some cadence And that bit a see actually more you than bounds if sort of suggesting just business TV second bit we But expected. this on could sort maybe implies? in Great. of Anything what a to give

the yet. but out shipped a saying used of are Yes. I being correct sell currently DOCSIS of builds, on step is the in that obsolete to What's the It's in what's which But we're kind things just X.X mean function on terms that, that going the you're way, or it's of repairs, built more state networks. I are need middle continuing right products year. areas think or that not now steady you're those are now in less their they're new products, business. being be what to in like deployed upgrades, not in new

to we several models are expect as interested expect June. the products time very those prepared there, be pretty then used the really year that MSOs really in begin we'll we in network available. various between that gigahertz middle qualification the to have call quickly quickly on specific because ship of expect do several which that in why remarks dates And happen is for so frankly, where our excitement new appear and at layer are earlier upgrades different which to upgrades, thereafter we become starting What to I part April new There that's amplifiers the out be to is, is that going X.X they'll the as -- in products, some we the revenue frame. to those tried soon and are within there times are think in

from comes question Rosenblatt Michael Securities. with Genevieve next The

So and or like, expedite do that. the so now a it's mean, that to the it well wait so asked I your like up -- seems development sounds hurry you then situation. hurry over like here executed product, sort customer big And last of quarter the and extremely the of it you been up has narrative that the and to --

So could mean, [indiscernible]. you provide I that -- is

Yes.

the end -- ahead. mean to was that question, go didn't Sorry, the interrupt of . there

No. Yes.

you're So just But I more also -- also reiterating that But that. hasn't a mean what the give to I any can change us timing other on case, this mean, going in like is the I guess, changed. $XXX if million not ask I some number. delay color was That I just and fundamental confidence kind of is hear fact else here? that

Sure.

of mentioned start commentary to guess, first seeing, data the deployment that all, the I on earlier. So year the with slower I we're specifically center that some

What qualified . And sets So initial can the I'm difficult to quantities order they scale, there for deploy proof fast make it probably is technology larger begin these they explanation quantity things phase putting will And of understand issues. sure to slow the product that then and that take deployment. that's that and use. prudence, always And as that into likely to they'll They I continue an of then initial in it's what's there's right? sure well, most start and believe as are Data going happens to to no on. don't deployments you it once the it product want then probably put going when deploy. order predict. the is based centers on they just new at

build we we still year. the by as that of and throughout of time, to rest year. through the the the we're for ramp capability see at expect rest I manufacturing mean, the far capacity see continuing way, As what to the the same

you So give the as far as there. what can confidence

CapEx. think is heavily to probably point thing we that the continue pretty to I that could only invest I fact in really the

QX. the fourth significantly ramped produced at investment came it's that products year. you not of it and in Clearly, in CapEx our look in quarter, was the earlier from If online all what

QX think so with would that some That, And give this markedly commentary temporary along is of about level our improved condition. hopefully guys you I a a confidence

by, something we [indiscernible] and we based of sample think [indiscernible] I And X -- to don't to we on. the will in QX or forget, said QX, U.S., customer the early [indiscernible] new would [indiscernible] start believe end I would volume have be . the the the say, we QX, had

then accelerating follow saying XQ revenue to also up like I QX. mean hear delivering you we point on I'd of but Yes, that because into expectation sample, in

So in that -- already you qualification must But step the X of sounds milestone. win. already like past Is you missing already that. correct QX, your have it that understanding? Is customer given between kind confidence must passed that is those be a

mean be that have that we are this qualification in opportunities to juncture. we've deliver to up that we various Other Well, certainly that standpoint about past qualification QX. finish point obviously, referring in-qualification been questions, we I of for revenue in the opportunity time the opportunities, at or talking either to were able expect qualification on is the pass earlier to -- most

Okay. roughly then better. And revenue just you transceivers sort mix now the help give right little final sense Could us bit between data the for of business center just of a Great. understand we ahead quarter year, to a in this mix to mix? we if year, of is fourth look that and constant? Or remain then next will change that of some to, kind say, the quarter me And lasers? see going of first

the much. cables. are is entirely don't expect to in almost transceivers cables right I of centers data it change mix too now, the optical probably So revenue optical active XX% transceivers that and

active or closer fact, probably cables. will are new get it for about talking XXX% we're either to all because optical opportunities In the transceivers that

be now, understanding can this read fact, well, not kind bit own lasers, think of had I the is might question, of our you a in the is the be cables, optical you that true. So it with projects of different I of, But right? be active X into might for all little lasers completely that are question that that right active used what thing cables. we for in X of may X behind that giving I optical think And if lasers and most is Microsoft,

So ultimately the active lasers, for lasers. utilize the be -- lasers working revenue those on we revenue cables optical the making and while are making will that

Yes. questions that, actually wanted a of and on to get lot do it That I make that but I was understanding, I sure understood my correctly.

thanks time. glad the much on here now answers. be conference getting Thank so good and on I'm So to you. a for the be in call to

to you, thanks. We're excited have

The next question comes from Tim Savageaux with Northland Capital Markets.

A couple of questions.

First elements on, of that you I guidance some the guess, year. provided for

I want talking to year. basis. you I were just for if or expecting don't to or So the or that's be operating confirm profitable know income . that a both. I But non-GAAP think on net profit

Yes, be income. yes. income the net for that net Non-GAAP profitable would year,

given guess us range I and a for Well, Okay. OpEx. you've

I can you're may know be over may a year, saying we range million. a XX% from or back get -- to mean, of which if the revenue I that that So margin half up year. toward that year obviously, perspective. that low not solidly gross you're the math am starting mean But reasonable, I of pretty I $XXX But that's the for to stay right? take doing out the weighted able

Yes.

Excellent.

follow category. to on want I up then on the And details some Okay. XXX-gig

fair I active attribute to expecting of run expect is to extent turn on healthy XXX-gig demand a or that the in a type million shipments the all say, back on, that about optical your you the be quarter increase of most $XX it where the quarter exiting side. to increase You the from saw rate. pretty that's to declines year, is let's order is as should the it QX, you weakness of magnitude we in the standpoint. that with But I and move assume mean, cable way $XX towards million say,

questions let's a see there. So in embedded couple of

that responsible one increase active The to revenue? was was optical of is cables the is yes. first for XXXG most in the answer The

$XXX to expect The you're is year. second part we that? year earlier I or confirm that of. Are end clear of another that just there the on rate a kind that was quarter that that run question to of the I million $XX trying by was said quite exactly a would Or you asking million be wasn't a kind I of of question how

No.

or expecting Another -- most QX, should we extent the level there that above from is to AOC -- that referenced to you QX improvement question in think returning or is, all you're bounce which of that a say or little perspective. the and improved back an release, that

I'd have ramping in to -- I'd start do XXX-gig of to to other to business it's to as precisely. probably math kind some the question it. expect that have do answer We new close well. QX

little hesitant that's likely, a I'm yes. So be I'm that, would close little most dominant a factor, it but to say absolutely the to

products least, X Last Okay. last about you for at me, understand. one including customers, to hyperscalers. sure I XXX-gig Great. quarter, this you talked think, stepped I And sampling then I X and through before, but want to make

right. or that expect that kind metrics sampling customer? saying XXX you in whatnot I customer 'XX? QX is is you're think QX, either to engagement start to that be have one XXX those contribute what sampled has to and you I turned update into got end midyear, QX gig to of when of able XXXG any on there or QX the And of into production year-to-date Is

Sure.

I have any XXXG mean, on products of be completed final this point. So qualification not at to clear, those we

or that new we interest that some month just we've from at X last I customers don't other year. the we And new we last so, know, year. significant that, to of besides a in had last, the did within the sampled addition X customers the have year to So end shipped

here. our too tip hat trying much without So to

these year us likely I a shipped that to XXXG. or we revenue more last time the generating customers it's X customer think for be the in either customers QX X newer will of frame or of for

guess, as could the for As particularly acute. to we have kind would say now, the far say, right be the that that the around it feeling you seems demand. I I demand, kind of of need XXX gig

quickly. somewhat rather cycle that demand when I to that my when things out this that demand lot and situation in of be It's typically revenue may definitely that. and point. at the And start estimation we're for means and a that you go stretch for think can see in that, low qualification not qualification It's there's -- like generation XXXG

got it. Well,

sneak here. in me one Let more

that. I what XXX-gig those at a that the of of of Microsoft. lines, over about size the how bit at couple have, the as some opportunity you spent guess, X engagements at look sizing time you last your cable optical gig. you with to Sorry active But along and guess, Microsoft quarters But we've I opportunity you XXX customer relative would about been pipeline talking fair

that's I mysterious times larger. several of get. moving huge. XXXG times to in But terabits demand remains want there market the about nothing all the profile, AI. It don't size, mean opportunity applications or And is should of under at their market of And infrastructure be right? be there's the next to that I it's is how compute too earnings we heard built, I year. frankly, irrational about yesterday amount NVIDIA the by that can there of point. much it opportunity and exuberance interconnected. the that being mean being lot market we'll be seen to at on X.X be being probably interconnected some call needs early -- we much larger, create to mean many this talking driven is today I a

huge. is opportunity the So

for I think that. we're well positioned

to there lot not huge. will a earlier, to get interests market work little early I'm and a predicting new recently. a get. to that mentioned market going inbound say, to opportunity And lot what the is percentage of we've of be of seen customer done, ultimately be just I but there's Like It's able we're

Our from Kang next question B. with Securities. comes Riley Dave

you in terms first color they're question first is My provide each outlook. more going segments quarter Can how regarding decline just your to of . product sequentially

Well, happens product to we don't collapse no enough. big going In segment. of business, really the guidance give TV But kind matter clearly, there. not not it's X. cable It's to by the what

to account the So decline. whatever happens majority there is not the for likely of

year, of a our We So lot that earlier there business. that's center of primarily noted it's in made in remarks lunar facility. products from these our data come are a the combination to that the China factors prepared going

bit caught why the mix in unexpectedly to of this New new bit planned end that's products products that unprepared those and year. little And Year us year, hadn't advance, last essentially we towards a the necessarily make shifted resulted so for which us of Lunar in on little a the having

did end addition the the the data again, in kicked both of reductions. that, year. And towards for In we those of the side to have factors And of of center last in X can account that, decline. that some is you pricing assume bulk most

pricing reductions, about gig it on second it mainly So was XXX-gig as or part XXX well? involved the

gig. it was No, the reductions I XXX believe any don't on in gig quarter. mainly we had price on

are about quarter Got about when recover you talked will second snapback, just well? as gig? XXX-gig it. you then And talk XXX Or

near talked may technology the in about life will picking it to later be going but be more earlier, as we a to in gig mostly XXX contribute We XXX in the up again, that XXX clearly phase we gig. expect be year, in clearly XXX as future. There some cycle. expect is gig, its gig is little of well. unclear, the recovery waning bit And is

then it backlog their you of us of have Right. this that to forecast? based any gives that ramp speak kind you'll that And they'll year? throughout Or confidence like still on Microsoft, the do on is

a what a no. nothing we've always but it's do, consistent over seen have year, with small backlog we throughout mean we what ramp It's that would years. the the I guarantee

another to about you Microsoft my the And latest talked What's it. is, that? Got last supplier. on question add

sorry, quite didn't understand your I'm I question.

You [indiscernible]. another supplier said the for adding Microsoft

Yes, supplier that? on latest Any you. adding update AOC addition in possibly to another

Yes. get your now. Right. question I

supplier if mean I'm able I'm there's information point, that share wouldn't at to as aware this be this shipping I but I not of that's really really matter any even I it. at other of not So point, fact, that aware But were. a

So.

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

Okay. Thank you for joining our today. call

updating and customers your employees our extend continued we call. our for to you of want thank We to see look always, support. earnings As and investors, to many a next you forward at [indiscernible] to on you

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

may disconnect. You now