Silicon Motion Technology (SIMO) 2 Aug 242024 Q2 Earnings call transcript

Good day and thank you for standing by. Welcome to the Silicon Motion Technology Corporation's Second Quarter 2024 Earnings Conference Call. [Operator Instructions] This conference call contains forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 as amended. Such forward-looking statements include, without limitation, statements regarding trends in the semiconductor industry and our future results of operations, financial condition and business prospects.

Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them. a and differ actual or materially these statements risks our trends implied involve forward-looking may reasons. results from for statements uncertainties, market and and in These of variety those expressed relationship the risks social change and pressure the our such consumer political, multimedia competitive with pressure demand uncertainties to, effect unpredictable in prices; electronics; and in but not legal for semiconductor are economic, Potential and limited conditions state and customers; changes any continued Taiwan. changes on the our industry in of and of include, major in consumer technology in and

be We For this see no and any update statements, go to these today's the risks to now obligations pleasure to Please the of hand recorded. It which ahead, additional Senior date file forward-looking of is call. as Sepenzis, of is apply we over advised company. of uncertainties Please being Commission. of Tom the from time discussions Securities Director and assume please my documents that the time you sir. to other conference factors, conference with Strategy only Mr. and Exchange IR and

and Second Good welcome and to Conference Silicon XXXX morning, Financial Results Motion Call everyone, Webcast. Quarter

Jason President discuss me provide outlook. CFO. then Jason Wallace business our Joining a key and and will second results review Kou, is will today Tsai, Wallace and our developments, first and quarter CEO, our Interim of our

with we a conclude session. remarks, prepared will our Following Q&A

you was our at this read call. Before of we I to harbor safe the get started, which policy, like of would start remind

the refer securities, with involved Exchange investing Commission. to For our a comprehensive risks and the our with filings Securities overview please U.S. of in

call. webcast filed after We a please evaluate our will on limited internally measures non-GAAP which will our use Relations be investors' our replay Form this to website time. To performance, we the for This non-GAAP the understanding Investor and financial our discuss the X-K ongoing information more our section on to in market economic financial release, refer during enhance yesterday. of details available For results, press of close manage was for of operations.

GAAP therefore, consistent own We enable of manner the we to to you analyze with a our provide to results. comparisons how results operating information The Wallace. in reconciliation yesterday. found in our have, perform can conjunction operating of chosen this non-GAAP ask to financial be the our that, in turn release data call. With I this review you over earnings will to it with call issued that We

as upside by on guided our continued NAND strong began OEM half and sequential everyone, mix achieved at driven increased XXXX. thank and for smartphone XXXX, in better to Hi, our customer flash building momentum the at steadily Tom. range expectation start had high-end strength you, of The was and and the of continue our in you that of growth to second ahead half a We improve revenue Thank us seasonally demand stronger margin second profitability. demand. revenue pricing delivered as our PC joining anticipation today. We gross calendar of from

controllers share to than market increased flash the continue top from benefited at we NAND externally as Additionally, source they them in-house. makers, develop rather

past hard partnership flash quarters, working our with the been our our customers. deepening have Over towards maker few NAND teams

markets. for more and and controller We are automotive UFS to smartphones, and winning PC, more sockets mainstream high-end other SSD eMMC from and

our has and strong visibility Our our crucial with aftermarket. uncertainty, the especially our to despite this year flash helped maker in retail improve is success partners growth market

best controller solutions position emerging with product to strength more nearly accounting rising, NAND makers flash makers softness in SSD from the than programs is from eMMC, for our maker and but XX% this quarter, increasingly Both for we more grew the our offset revenue NAND XX% total our our flash than from controllers' of module in This benefit sequentially, Demand growing outsource trend. revenue. market UFS are new retail customers. and

and family, pleased multiple X.Xand year, new PCIe UFS class, our build through in and momentum X.X year new half to position technical products the unmatched enhance the half the with MonTitan first in of have team's year. and financial our I'm controllers. including next-generation We the resources enterprise into controllers, second we going coming introduction of to this execution the intend our of

need with solutions. I of on improving profitability We would additional focused us, revenue products driving opportunities growth our to solutions as like customers ahead dynamics. higher move across demand you now the is increasing by XXXX, platform leading an driven we year from NAND significant have data applications. primarily of deliver market controller and and to enterprise and and the our overview and remain of early NAND throughout remainder to pricing storage center NAND of provide expected and

both generation global last maker to in demand are grow and invest aftermarket with and unit also continued back NAND improvement NAND not the LDPC higher to expect other that by and anticipating day PC the in OEMs It we higher see that remainder pricing headwind, clear is But differentiator that from Despite QLC experience bring module year-over-year. OEMs As This softened data demand device continued we weaker continued come balance QLC increase is each NAND edge NAND economic algorithm challenging beginning increase retention proprietary customers. devices. flash with such other capacity more makers With and to the NAND center inflationary smartphone product and XD even has year, the and wins and supply increase environment advanced significant to until support sales and expertise caused to stable in data NAND for reduced the new by pricing NAND the with pressure, major Managing makers muted our modestly incremental price back solid-state online determining QLC continued and being lowest to our XD across the issue. interest storage demand as becomes smartphone and of retail holiday the sophisticated other NAND productions. and we experience they and higher-density a some overall the customers need back-to-school resulted continue RAID defining year, the PC, driven sales technology controller performance to into applications the firmware technology and retail expected do in increase. to and expected as advanced middle-XXXX. Higher solutions. ensure and expect SSD. becomes require read/write to more NAND for has appears of AI inflation market, in layer our require categories. The

trend we all the deliver to category cost. benefit are be its that believe increasingly at ability coming major in we market best serve, across given will NAND QLC from expect We high-density low years. to we deployed positioned the And

represent driven Now, our June our major customers to flash as each maker sales high pressure beginning quarter like experienced PC NAND discuss D-controller product OEMs. with channel demand makers. segments, in controllers. PC approximately the historical from high our I'd prices end our It's our of are SSD strong by We module OEMs Client of XX% putting range D of sales. controller at on and

suited high-end is customers generate that we ultra-low a new as to to interest this to controller addition ideally including significant We for and NAND nearly consumption X makers. controllers, power-to-performance, those announce PCIe our makers. controller remain win, which out ramp This XX% quarter of the X in initial offers a notebook performance by desktop, led will channel be every as pleased internally with power We year. taped premium we new competitive won workstation PCIe to last units X offers major consumption. The developed This our track AI continue product including than that GenX has in year. X-nanometer PCIe in XX% PC, to maker, well X-channel gaming I'm on that lower power and NAND first PC this our for market, is best-in-class which with offers module unparalleled available the controller strong controller to fourth later

high flash Additionally, pipeline using solutions. density activity and for we and several PCIe SSD cost, design NAND. high of performance AI for a X at rapidly SSD strong This a PC searching TLC is new that next-generation a lower QLC ideal growing makers market delivers lower have with of cost

to commercial continue opportunity top We revenue, customer with as well our automotive PC adding we to with intend multiple through expect commercial seeing opportunity industrial-grade include our market industrial growth upcoming as introduction year. for a priority a controllers and of X to controllers. emerging our will applications. expand diversified controllers the X meaningful automotive, our and dual-port continue end-market While we are significant more and drive This XD automotive And controllers, and base. market and PCIe growth beyond, remains XXXX targeting in next the grade leadership the PCIe

UFS business. and to Now, I like to would our eMMC move

as We the our our smartphone June early as been and X.X continue quarter, the we first to with this out customers. controller benefit during taped NAND X and from has UFS, year, eMMC market strengthen UFS We improving positive. response the successfully well

we We smartphone to stay I the and years. calendar and X.X most market to X.X in are continue for relevant targeting coming UFS ramp today, XXXX. the production and of the qualification, beginning in half second expect of are account volume it

UFS to allocate edge. to more so high-volume they seeing applications compete leading can are While outsource resources we flash controller, at of makers in opportunity next-generation mainstream makers generation greater look products NAND, more as support in flash that new effectively

activity inbound eMMC. our As for AI, product, controller OEMs PCIe increase and in looking UFS are a technology are density. effective memory device strong smartphone QLC interest home way generating to With [ with our ] growing in in edge leading we cost

the UFS place low-end AI and manufacturers eMMC over as next Our with Silicon few the mid-to-high to technology QLC years. other Motion devices, end are leadership looking forefront QLC adoption with QLC at deploy in for controller handsets and of NAND in QLC intensification for storage smartphone

handset more, this customer pleased this deploy you later into is ramp to OEM year. today this will smartphone that on to models year. partner expand Our new report of Once QLC production expected additional first to QLC expects UFS to solution that next UFS I'm

consumer OEMs eMMC in and adoption of Looking beyond smart smartphone the are interested for devices connected UFS, market, other applications.

customer list and area growth diversify in this wins market further additional of Our our end opportunity. will growing

Given opportunity believe flash are share of well our for eMMC growth. maker solution, and we to introduction we UFS/QLC through capture with and increasing new the partners continued positioned the

platform. let Now, turn MonTitan me our to

Motion long Silicon with have combined offers we and a the medium center meaningfully enterprise tremendous before, data and storage a opportunity, revenue over margin new profile high As term. ASP mentioned to

more to solution. see inbound continue our interest in MonTitan We

well unique our are we center to years. coming storage as data solution with enabler, the and well we directly differentiation, flash in scale Given enterprise with customer a believe positioned and as maker

QLC managed center first a NAND QLC and adoption transition seamless Our the NAND storage on X enabling and controllers PCIe applications. TLC platform, MonTitan data of enterprise and single with

X Tier and and PCIe for X As won wins later One one in the Tier our in new controllers. customers X the MonTitan additional quarter, secure year. we to this U.S. announced last we have X X China, expect

and to more mass year. track later on ramp production begin are We this early meaningfully year next

Our platform than any Placement speed, with improve greater NANDs DRAM controllers with QLC, through today. MonTitan early success differentiation offering which reduced X Data and lowering with driven our been latency has the technologies, support power Zoned high efficiency, to key Flexible while performance cost more and overall and for chip delivered through other demand. in market Namespace combined

with read proprietary center X high-capacity their SSDs compute customers This performance market ever-increasing than decade. clear storage over will SSD. These this for have requirements. growth our managing the meet the the terabit becoming solutions terabyte to for changing MonTitan enter for in includes We mentioned company the past data Silicon XXX capability product build-out calls, QLC especially essential and our our given more adjust accurate and previous for upcoming enable faster delivering mono It year increasingly power sequential What a believe drive the is of new and lower technology. next-generation storage our leading on meet AI we Additionally, that QLC anyone be opportunity center performance cost higher NAND our technology data AI rapidly for our plan, die Motion, deliver and to dynamically greenfield to cycle our the platform market. shipping requirement. and storage multiple customers NAND, to we will have ability that record performance to as

customers. flash to XXXX and of platform of widespread the MonTitan XX% of to performance XXXX early Overall, timeframe. to pleased year. revenue revenue the prices products, total our by in X% we to the the NAND year-over-year target our grow Given in XX% remainder I'm expect some our with start we and our in excited the near-term XXXX that outlook for continue our to to despite growth to the increased strong the especially XX%, challenging over from I'm interest

of wide of our of controllers market long-term are ahead, substantial and will technology and a our drive leadership accelerate confident growth across that our the applications we diversified and Looking portfolio business. range

push to commercial smartphone expect about opportunity, enterprise, MonTitan emerging and will beyond into markets. and I'm continue including We a consumer new the as few opportunity impact be and enterprise automotive, significantly PC positive I we what on to about our revenue, excited margins the especially market. operating over update. we more the gross years in share look area in the future the in and detailing progress our next capture industrial, forward

me to our Jason to outlook. over financial results let turn the over Now, call and go

is the while non-GAAP website comments my morning, our growth. will increased quarter as presentation today. I data modestly reconciliation of and sales uploaded second yesterday, our of then unless results to the you, consecutive Thank specifically representing provide the to sales issued everyone, fifth little included our release A increased primarily a discuss that us our GAAP second earnings focus good sequentially, well Please and in million. our joining results on Wallace, quarter quarter, noted. that was $XXX as XX% ago. In non-GAAP of guidance. will otherwise details SSD today note to sequentially our additional

made products. XX% demand Our increased in smartphone weaker eMMC flash sales SSD gains growth quarter increased anticipation deliver uncertainties in continues second aftermarket contributing to margin NAND yields a we expense Operating product inflationary decrease from of X share second and margins production market XX% SSD as in PCIe in the term. to deliver long increased R&D quarter from XX.X% to solution the specifically when second channel sequentially increased primarily than million, expenses, quarter. high-performance quarter later inflected $XX.X demand enter higher continued Operating slight the to upcoming higher in we SSD will half XX% results controller superior UFS from better from for second outstanding of makers builds first despite This were strong margins gross the the newer X XX% in year. decision to from some this the XX% pressure re-tape our out year. and in Operating this to XX%, quarter, mass in to result first in was project flash sequentially. Gross quarter higher expected to the increased expenses second in to the client overall the mix with controllers prices, quarter. up this as demand. the

second in quarter. increase quarter increase tax results ADS $X.XX, $XXX,XXX per which second quarter. quarter. rate $XXX in cash effective the from the the from XX.X% from modest the second the first the quarter. Earnings $XXX the million million exclude first the compensation, end Our investments quarter. quarter restricted of $X.XX million decreased were stock-based Inventory $XXX.X We non-GAAP in at in the cash, of the is to cash was XX.X%, in from first rate at the Total had million of second the first our tax a equivalents, we compared an to in $XXX.X and quarter end short-term sequentially

Before I outlook, more making that talk to year. our turn like a R&D higher about we I'd to are bit this investments

power means UFS consumers next-generation to to to on significantly process both lower and industry lower standards, battery PCIe performance As way building to move the at notebooks new these and or for demand. and the same controllers needs previous life same doubles consumption geometry that to only performance adopts from high-performance production. remain X-nanometer. The And power that higher the balance the lower is standards smartphones assure that

firmware to SoC mixed-signal with architecture, NAND customized collaborate new that closely In goals. architecture and need these we to partners capabilities achieve new addition, our develop

of this term, do including outsourcing than While product all more in does in and ASPs, expenses benefits, around the near bigger a significant we before. result leadership moat higher higher R&D ever our see

this higher for and term. essential and order resources, the drive share to to faster over profitability technical better us intend growth market in grow and and increase to our We long financial and have make continue unmatched investment to

to our turn now outlook. me Let

earlier seeing weaker our NAND aftermarket. As this electronics talked -- ongoing consumer customers, retail module Wallace about makers, demand in soften demand, earlier, to higher and are retail the prices due the especially year

we'll much past they us seasonal that anticipating able year the confidence achieve year. this half a second makers, customers of this, As full-year for be our over flash pattern retail are we ongoing a our outlook. result, for increased the to won muted more the and demand Despite success have gives revenue outsourcing with

million weaker flat due SSD expect $XXX For the million expected quarter, or $XXX X.X% minus sequentially we demand. seasonal plus to approximately to to be aftermarket third to revenue than the

expect stable to and sequentially. eMMC be SSD We controller sales

quarter Third be continue to to in XX%. XX% improve gross expected margin of the to and is range

gross products Our newer towards should improving lead of margin to sales mix sustained improvements.

margin quarter expected decline of tape-out will operating new X-channel our mainstream driven Third X SSD quarter X-nanometer experience controller. PCIe X client a by the

expect enter into early SSDs XX.X% is of production to the to September expand range market. Operating the and PCIe return in the XXXX expected X to levels. as normalized new mainstream more mass in in controller quarter We this will margin XX.X% then be

to compensation effective should tax million quarter dispute-related be in of third expenses to XX%, $X.X and quarter range the $X.X million. stock-based rate Third be and

NAND full continuing maker For outlook, million. approximately our to million year this are XX% strong demand maintaining XX% revenue given to but to increase year, $XXX is customers, our profitability. Revenue $XXX we from the the to improving our expected

the margin our margin to be year expected of performance year XX% are the our the investment improve margin XX% XXXX of to lead the range. Operating margin gross expected revenue our margin expected first gross despite range be in and already. should given to gross in half to is to in product XX.X% XX.X%, strength improvement and the beyond. We introductions given growth the accelerated in technology is this in that tightening leadership is new range, and to better modestly, of this Full-year

tax to loss of is approximately XX%. come XXXX $XX should settlement million expected stock-based dispute-related compensation, the slightly be of litigation Our effective rate $XX range down from and XXXX expenses be now and million. in to

dedication we smartphones data the develop the applications will controller deliver enterprises. soon With year, cutting-edge and to of over and AI and solutions able PCs, centers team that and have been power past our

commercial solutions such range wide industrial and traction of further applications, long-term markets our as controller Our gaining in diversifying automotive, growth are significant drivers. other

efforts from of more to makers visibility have more Our better driving trend outsourcing, with growth market benefit the flash near-term collaborate allowed recent despite more us to predictable and volatility.

While growing year, we invest investments will more and next driving building to prepared capabilities concludes share begin extending remarks. the market. This we technology and for in our now meaningfully continue R&D flash controller and further the in these We'll questions. and your our dividends additional controllers, to profitability leadership to we pay products are expect these leading-edge growth revenue scale our and market seeing open call

from question Our B. line Riley [Operator Craig Instructions] first comes of Securities. from the Ellis

at variances points gain and you versus were share you that objective ago? just for where basis hoping you Yes. with with execution think we Wallace, one level stand high or talk about and of XXX was At the year, intending positive off year. to just on share of midyear start negative followed any regarding comments of months X NAND gain. that you up OEM some I your were what wanted to see Can beginning the against this

aiming plan So very, to We all do. and we're NAND the capture on all us. projects to makers, variable far, I very we all think maintain relationship the with we close open the socket for and track

a around win. believe gain we XX%. XX% continue year is this the last share range about and to forecast by design about -- end. SSD are we our we for gaining with was And portion, also XX% so XX% And And year mobile -- share is we'll believe to

the So, opportunity all we third to Motion. source capture cautiously all monitor to especially Silicon parties,

mix us how Can follow the providing that to a just the GenX side by in year? relates much would PCIe then this shifts next year? year, when would on to over PCIe to context GenX next And helpful. put the where in GenX of help look higher the we That's up question SSD business PCIe controller you summary PCIe volume, be of And transition. ship as GenX

from GenX the maintain PCIe XXXX, will XXXX will early premium but start ramp Yes. line. to high-end

be for So, and workstation the that the high-end PC PC AI PC. in high-end gaming PC notebook will and

maintain and So XXXX, moving low, for very next transition. GenX probably the But high growing in year, the X% volume about to volume will the we're coming. mainstream still PCIe

maintain probably PCIe next I market. and total GenX. So PCIe occupy year, of around -- will By think in GenX, SSDs majority of we'll PCIe XXXX XX% the

Our line Stoss Craig-Hallum. comes the from from Tony question of next

Maybe Jason. for you,

QX? tape-out want And Just us? follow-up for your QX. expect tape-outs in also, love you to for you expected hear commentary size to continued any on maybe thoughts, the Can do I'd that to margins. increasing into gross you it's be lot assume than sense of higher ballpark a XXXX? might of positive commentary XXXX. kind you of I Can give related And heading think what us would

Yes.

the tape-out $XX for $XX entire given tape-out. of controller. we about probably quarter, X-nanometer over to that to million any million charge costs, typically tape-out do quarter. $XX million tape-out, production we that's running In So million where actually $X a in that's Obviously, costs, talked the per

that's quarter. X controller So, here that taping this X out from the given incremental new perspective in an channel X-nanometer ballpark about PCIe talking we're QX, the

PCIe we QX, for tape-outs any for into expect additional do Going -- not X-nanometer.

come So, see the OpEx quarter. down in you should fourth our

steadily that and gross due margins In the we've more margins, over from we been as gross products mix. newer terms more of generation last to so, to our or products. continue of better improving expect come our year progressing And

PCIe also to we'll have MonTitan starting year, more ramp as meaningfully. little well a Next X, as

positive and well. us additive should we've as to XX% those Historically, at been for margins. So, XX% gross be

this into year. in should year, we then range. be that that I next close think get And we're to pretty going to going

of your customers MonTitan And at end adding for the it. to additional maybe this then, it X then, of make a follow-up year. Wallace, Got on the you and X

how you Can And about of do call, give think you that I you us update a in in of can take number more take and think you conference on maybe can sense XXXX? even can talked ones the on handle. customers quarterly you many a last think additional you you us? customers

Yes.

X So, resource handle we X Tier Tier have as winning are we customers But around can simultaneously. X -- customers. roughly, of maximum today, our R&D X

firmware would a One customers the develop with of themselves the SDK.

technology will [ way help resources. us help So, their into them the upload that to by provide ], porting and feasible We the documentation, our complete platform. firmware

once and golden So try will think if firmware complete and be I it the gets of support OEM documentation decide ASIC, able expand forward range I we standard more We're wider our the X can customers to with XXXX, done, solution Tier basis than looking our customers. customers. to X for use customers expand to in because that we other turnkey and to more SDK offer we to resources, both and think are

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

into percent the follow-up of of except SSDs sort as on do Craig both a 'XX? you couple business see question a and And you Just QLC and of the to got wanted similar Where I've QLC. follow-ups. to asked, smartphone get what of this 'XX maybe mix then time as

question. very it's So a good

today around PC, But in single the makers digit, driving about the to because XXXX that's XX% the think [ in XX% opportunity we Clients minimum for are makers, the smartphone, they for the NAND are QLC very office. are Since into deploying smartphone to side. all ], the the shipping mode. very trial majority D I QLC XX% low low in roughly XX%

very they But come less So we be X expand try eMMC it into fill to after time, high-end. total the for to X%. single-digit, for will percentage than We same line. adoption should mid-range. they value very, the probably the the initially low from is they models. makers multiple very midrange to smartphone see UFS going try next into successful, the year, after see But QLC And will deploy down,

with But than to it's QLC, They and TLC this won't to end-user between momentum. density tremendous opportunity field, transparent difference see higher have consumer. but and traditional a the really TLC. and make probably So, is try try they the a and sure

And Got question on MonTitan. it, Wallace. then follow-up a

and As if lift that ramp you it enough puts your the to you to target it you mentioned higher you level? you end Do X% additive premium margins to margin carries solution, XX% that, any on XX% of think it the kind range profile? carries be ramps that on above Wondering how margins. of that 'XX-'XX. Could XX% to hits sense target XX%? in it that of the MonTitan push Just that could

early XX% us the Yes. have comment this have upon little Wallace a MonTitan achieve But been margin too a greenfield XX% what for opportunity that about that It's what I and we've had versus we think, today like to out. historically, to point, based 'XX-'XX profile to at Quinn. able we today products -- is pointed

that us be think that timeframe. longer is to lift 'XX-'XX I that, So, additive how that it's term. too potentially maybe additive could up But a little early in say to

'XX. long as the investment you're ways you spending controllers, just another then lastly, you heavy UFS look the out. it's the PCIe on GenX at expect today X Yes, I Jason, expenses know And in wondering if no, products, year

are upside guys as revenue well. have You a obviously, done but year, this expenses in increasing great job,

fall kind less operating than pace. been just EPS. pretty there's as perhaps through to if you at might on wondering leverage continue year growth so of increase expect of rather additional some year fast And next a next And maybe to those revenue stabilize investments

about to of We're the saw seeing that year, do X-nanometer this investments think a given year. to lead OpEx little revenue these at sting we it But but we next pay the early exactly year. That wouldn't it. we to talk this tape-outs just for -- the grow it's this making bear it to grow kind the for expect as I start will way of we year, growth. nearly look expect to we're fast as That's going we off dividends initial had Yes.

comments. some add just me Let

try our next we operating to control year. think I spend

very a have However, NAND from strong very, makers. demand we

Some to UFS certain customize new even asked controllers.

based We on decision. think But the resource of some decide operating it, every will increase have the calculation. that project, make to cautiously we major do the base do we on return ROI to review I -- we our and will expense. will to financial If

Our line Desilva from from next the Suji question ROTH of comes Capital.

progress terms here. product would wondering content SSDs on you the clarify be PCs, if just in the of uplift Congrats there is could for or The PC, just what I'm versus AI that helpful. the the non AI ASP

hope a momentum. so AI asked I question. got you. far, I can By this good PC very tremendous answer seeing a You

meaningful However, purpose we consumers increased really applications Besides waiting any make the Copilot, so shipment feel the to is more to think impact or meaningful PC did not for the I corporate practical both and Microsoft unit application comfortable. see market add far. coming

with think new but I many OEMs' different platforms So, also bundled coming, own AI applications. PC some it's there's many,

So, consumer foresee feedback adoption. have see wait, to we to the

shipment at the I single-digit to the a increase think far, is unit for the maintained beginning XXXX. So compared year, of the PC XXXX same

Okay. infrastructure And to the switching side. then over

GenX, better much Sorry. We SSD, become better sequential plus latency. that performance, PCIe have definitely see they better shorter read, provided provided a much because

we see high PCIe X be -- why SSD that's potentially, in channel do So, XXXX. GenX there will demand for

a content inner Maybe and per get get the how a be AI Great. can the then to for X that the Can maybe that infrastructure you? the these programs these way you give overall to -- to they kind about 'XX. switching X rack available you That's framework? us per side. ASPs of it. of for How might framework adding? Okay. programs And be some server, on Got are would think on big one content sense MonTitan

We we it right, don't density. on because a We sell talk about controllers. sell basis, volume

XX different enterprise look I XX take controllers if Obviously, that in historically, the applications different vary. a plus configurations you servers, SSD in for at, ballpark. can range to think typically

of really sort of difficult it's to is use algorithm real or to kind that on for that? there us any you So can assess say

the The ASP a controller. range. So, can only we channel the between range MonTitan [Indiscernible] to roughly conservative for $XX range. give and XX you similar TLC is [indiscernible] is $XX QLC, price density,

the also version for tape-out which price -- is controller, year. this a X $XX a new selling And next have have $XX mid channel of range. between We controller, probably to X for will design we channel

for the controller family probably So, ballpark is MonTitan this price.

Robert J.P. question Our Instructions] from line the Shui ] [Operator [ next from comes Morgan. of

Gokul of behalf on Hariharan. Okay. I'm asking

I for the well on inventory a question with OEMs, about customers? the the client have we quick inventory with How level. solutions the PC as the think level mobile SSD as So, OEM should

channel moment, the demand most is our channel have and very healthy. customers a for relatively is I just from But, to THE And think, I inventory deal. the we in level, inventory inventory this the retail, weak now. largely much at in level healthy definitely see see they side think of naturally in the NAND so the line because So clients for markers, however, lesser

up Do any questions, you have Robert? follow

That's it. Yes.

further questions. the back the no turn Wallace closing All right. now for conference and CEO, to comments. I'll showing Mr. President Kou, I'm

everyone, you, Thank for Motion. continued Silicon in for and your joining today interest

joining for events. Thank Santa next Memory schedule We conference of as coming in week, will now. of our look as investor will well everyone, be and Storage in these the corporate the you, posted Investor attending this months. the with event forward The Goodbye Clara you and website on to at today. companies several for Relations Future be speaking section

you This participating. you. call. Thank today's Thank concludes conference for

may You disconnect. now