Analog Devices (ADI) 16 Feb 222022 Q1 Earnings call transcript

Good morning and welcome to the Analog Devices First Quarter Fiscal 2022 Earnings Conference Call, which is being audio webcast via telephone and/or the web. I’d now like to introduce your host for today’s call, Mr. Michael Lucarelli, Vice President of Investor Relations. Sir, the floor is yours.

Thank you, Holly and good morning everybody. first ‘XX our call. joining for quarter conference fiscal Thanks ADI’s call Roche With the are CEO, Mahendra-Rajah. me on Prashanth today Vincent CFO, and ADI’s relating the find missed you financial and who investor.analog.com. schedules Anyone at release, it can

these materials to release includes statements, and and reports discuss uncertainties, our statements on from We with as the update the could about certain the as as described materially further Actual undertake except by other subject required to forward-looking the we call. periodic our which information Now, SEC. forward-looking are filed The reflect in date results to differ obligation these as this only to statements, law. expectations are risks information disclosures. our and of earnings no

also items. additional measures non-GAAP exclude measures these our are included include which to excluded in are to results of most will When GAAP our our performance, prior directly measures, special earnings and special historical items release. non-GAAP information today’s measures their from about also financial comments non-GAAP Our Reconciliations comparing periods. today comparable

it Okay. to that, turn Vince? over will I Roche. ADI’s CEO, With Vincent

Well, and thanks, good morning to Mike, everybody.

again, ADI start the record quarter, delivered marking to a strong another year. once So

unparalleled high-performance operational continued success was enabling our and meet for products. driven by and the our team’s better Our strong intense to portfolio our execution us focus, customer growing demand

up increased results, XX%. quarter led basis. and up EPS automotive. billion, year-over-year, to margin $X.XX our margin and more year-over-year was up at year-over-year. $X.XX, broad-based, was Adjusted to Growth combined Gross revenue with on industrial over XX% was XX% looking a first all operating XX% Now, by expanded double-digits than segments

a on possible. the offer our we combination microwave great our have teams engineering is since The Broadly ADI high-performance X expertise, from unique the long-term with combination our that nanowatts of from approach and taken bring we we had to nearly have Maxim has they us sensor that value received progress and expressed We and recognizing transaction, have engagements. breadth for increases as been to and have that ADI This solutions the strengthen trusted, the overall, Maxim especially portfolio with in takes focused of the that our the kilowatts integration enabling many Maxim steps have management. closed overwhelmingly been speaking, portfolio, depth complete and to and to a customers unmatched important customer-first from we of feedback develop it’s market. their high-performance is best-in-class operations. The a cloud. define customers, our to enthusiasm positive to-date. viewed domain from increased months to power the made partner more In the a acquisition together edge exchanges bits, Now, I spans to of

excitement across who is There has have highly been an increased have with unleashed design level. our benefits with already comprehensive operations, in portfolio leadership capitalize engaged opportunities for revenue industrial, opportunities our uncover we datacenter, and to better And are are field mixed and need us combination a positioned with throughout Similar collaboration, also with the to firsthand what’s I accelerate to ADI. engineering, for making me from I And ahead. attach to opportunities this Here, automotive, the implemented positions organization. existing sales The our more the desire extended activity of identifying signal seeing power cross-selling sales, areas RF. ADI’s growth. customers numerous the portfolio aggressively application power connectivity new support serve and teams and analog, organizations, at cross-selling portfolio, we and across allows solutions LTC to on our excited burning to we to to am better a consumers. address the and

combination we Turning operations, hybrid capabilities, microns internal enhances markets. for To XXX,XXX and our of across products, from X this our analog firstly diverse characterized customers, more This fragmentation, necessary innovative the packaging enabling scope scale partners. manufacturing turn access complexity, model diversity is external sector to strategy, our processes technology, in and nanometers expands create to capabilities with tackle applications our and to by customers. manufacturing network with a technologies The our us vast solutions to utilize with X Maxim a of and the across hybrid manufacturing facilities the offerings. by increases and which providing

effective in facilities our and capacity investments product Malaysia. internal optionality will this qualifications operations Oregon build and provides cost capital footprints We into model. are and our customers, and a Limerick To between to the investing operations and we manufacturing year robust grow foundry end, to expanding partners. more adding test fabs our our that and These the our Philippines, are give and greater our in our internal of significant at XXXX, seamless Thailand us facilities for

ahead April, trends Investor our secular Now we like excited growth and the seeing the many are of the make most of future effect secular industry our our some trends. market, industrial of of for the compounding in to In about I’d concurrent preview us Day that company.

aligned increasing test growing is test sustainability. scientific to continue connectivity, our and equipment, growth example, these instrumentation which to instruments, ADI’s The enabling advanced applications from our comprised For of and business, SAM. electronic complexity is with us metrology trends solutions, requires to more automated technology EVs, of measurement

connected empowering automation and another factory trend intelligent critical Our of more is business factories.

technologies, wired with we double the of electrification, market the leader we systems Here, in our battery thousands automotive are connectivity competitor. management, wireless for nearest EVs, of robust sizes customers share In of solutions. tens global with signal management precision of support and our sensing power all chain, and

infrastructure more ADI’s variable and related demand. monitors And human quarter, design wins to more also We are create automotive a auto seeing momentum parameters a the This ADI is electrification. environmental sector. is cabin. in Electrification digitalizing management, bandwidth, and of and systems, which with from user power to experience have well by Within and issues technologies performance vision storage mitigate creating manufacturers. not necessary are continuing to to as This adjusts with accurate energy globally. benefits remain requires and shift several manufacturers also sensing build power immersive recorded digitally new energy premium a we for efficient deliver latency grid sources efficient the green portfolios. supports the last stable. we requires power this There ensure generation energy new which European to intermittency grid, the conversion automotive, increased opportunities exclusive sustainable connectivity the monitoring to smart and as lower control

weight. our processing, noise connectivity highest signal fidelity example, with also system the and the customers audio solutions with For reducing while road AXB cancellation vehicle’s provide solution

franchise BMS, years deliver GMSL, market-leading addition, Overall, our In customer strong audio power management architecting and positions safety and solutions complementary advanced critical GMSL certified position growth systems in our are and in ahead. franchise efficiently our combined functional assistance in systems. driver the bases, powering with to automotive our

front-end. the and hyperscale digital carrier power critical industry’s fully satellites. now compute portfolios transceiver are with networks, to is growth integrated enabling in orbit ADI’s market tackling optical power software-defined the O-RAN, in first we datacenters. are exponential our includes networks to wireline, traditional advanced earth and low systems Turning wireless, SAM next-generation from control In leading to communications to a communication And XG, that expanding transceiver our bandwidth and portfolio of

see opportunity we Here and large a underserved ADI. for

our that forward backdrop, these with at expanding leadership with we look and areas senior to our on So Day more Investor team.

the So the innovating edge. at is in in closing, leader ADI

Maxim, that market our our continues in high-performance digitalization leading portfolio have and I acceleration very than see to about industry and even holds. has We additional portfolio more opportunity am an And increased optimistic mass of from And the capture share. industries. breadth to with depth what future benefit ever we across

us And so Prashanth financial I that, who the take will over you will to through with details. hand

everyone. morning, Good Vince. you, Thank

secular comparable delivered for and passing period. very products, ADI forma earnings basis me today, pre-acquisition add revenue, in strong My first a revenue comments my commentary will the adjusted on revenue, first in our capturing an profitability welcome earnings. synergies Let items Maxim press basis, with is special quarter, quarter excludes effectively exception today’s The reflect demand outlined of and costs. includes release. inflationary record the pro results be revenue and a These to which ADI’s on on with call. the

across Our robust markets manufacturing to grow. orders for team is continued our the diligently continues backlog as all securing additional remain our and sequential through external XXXX. balance internal the sets capacity stage of fiscal growth and This

our billion sequential near This first finished of of all high-end across growth. with fourth the and record So straight revenue geographies. end for and double-digit of outlook, consecutive eighth quarter markets marks growth $X.XX our quarter, of the revenue

revenue of including secular Industrial with more major most our underscoring sustainable represented for another revenue, strong tailwinds, straight achieved application year-over-year the energy, performance aerospace record, all-time automation, of which Looking for and at represented numerous new and our double-digit instrumentation. quarter, XX% achieved end profitable positioning, posting XX% Automotive, growth. has diverse every digital market market, supported year-over-year XX% by our industrial, quarters, high. a grown than five market and healthcare,

continues and powertrains. leadership automotive in revenue, ADI’s battery Our management electric underscoring over to system outperform offering represents of XX%

drive wireless growth continues of heights. new revenue cabin and secular to and exhibited strength the represented the wireline. to connectivity Additionally, Communications in both franchises inside and AXB XX% content GMSL

wireline, accelerate to line North global early was strong remains demand long-haul in are lastly, deployments to as their and and continue the XX% revenue represented We in expect in And in of and hyperscalers days by XG to datacenter. seasonality. from And XXXX infrastructure of cloud rollouts, upgrade with consumer beyond. and led carriers America,

aimed and mix. supported by we Importantly, strategic at year-over-year, investments customer to grow diversifying continue our application

portfolio demonstrated audio first wearables, electronics. segments professional hearables all gaming, The growth, personal achieved and as quarter breadth increased video, including our

with XXX product of the synergies increase. was XXX in increased of tax quarter better basis due approximately OpEx for $X.XX progress. were Operating was XX.X%. line were a key increased $XXX margin million, And higher year-over-year. sequentially margin the $XX faster at expenses record quarter. than resulting adjusted synergy mix, of XX.X% the million XXX drivers in our basis Now, told, P&L, XX%. All looking year-over-year, anticipated quarter increased the to Favorable in and points points rate gross XX%. last utilizations basis Non-op points EPS and

approximately on Our a and $X.X well below net remains increased sequentially capture. XXX synergy our the of under on end channel quarter pro this low revenue now by billion X-week growth and of ended was just of driven leverage trailing record equivalents. X as we modestly with one to sheet, the turn. XX-month the stronger was Days inventory And as balance target. basis, the cash to ratio inventory forma our to profitability And the moving quarter

CapEx $XXX XX trailing Looking the was over million at $XXX quarter million months. and cash items, flow for the

and front back-end fiscal a and more As to X% invest the during for reminder, build XXXX, plan a revenue capacity model to manufacturing our long-term. X% significantly to hybrid we of resilient grow

will level this Importantly, return higher of commitments. CapEx our capital not hinder

Over XX cash of revenue. the XX% free months, flow we billion trailing $X.XX generated or of

about cash flow related Maxim free due acquisition. margin was lower by X% to to the Our costs

the of with free of we dividends. and And Over purchases yesterday, via cash increases. increase use the dividend, flow to announced period, a to our of $X.X free share same cash just And as XXX% repo. for fourth We flow dividend, we consecutive double-digit flow more quarterly we returned our XX% billion our marking cash used XX% free the grow target time aim XX% free cash flow to consistently or return. reminder, to year than remaining approximately XXX% a

years. dividend our raised XX now have in XXx the past We

Our ASR retired program as in approximately quarter, we a the million concluded XX.X shares. first and result,

more now by halfway our the repo XXXX. of $X billion towards commitment executing are calendar than We end

Revenue And second or bps. of midpoint, is So or and outlook. quarter minus annual to outlook million quarter. approximately be $XXX million. goods consumer this of with the second includes expected XX.X%, expect and me At to roughly between run finish markets plus as is rate operating be evenly let we flattish. billion, plus all grow expected margin be sequentially to split BXB the At $X.X midpoint, $XXX minus to we exit for cost synergies, the OpEx XX

expected is approximately rate to tax be Our XX%.

adjusted And let end finally, EPS or around inputs, an $X.XX. with these plus minus on should based So $X.XX, be invitation. me

throughout at the our where Boston, We the we technology and includes customer-led showcasing management hope map. will displays April on in it system on see I’ll new demonstrations Mike unique and offer our strategy, are a for much headquarters right This of EVs more. wireless Q&A. our detailed battery off long-term and We holding you outside update X, person synergy our sharing Investor phases interactive to we day. financial hand of look for where all forward our to many model Day road of to ADI’s

Prashanth. Thanks,

have Instructions] to we first the get [Operator please. Let’s Q&A question, that, our session. With

Arya from line first our of of going [Operator with is Instructions] And the America Vivek Bank to Securities. question come

question. what could in Thank other you – execution. Vince, industry in over it you will large of your to my readout to taking maybe see you could end including the understand balance of online, sticky was today. is that if strong need trailing-edge what good be different help pricing us competitor? time? if of us for kind is more there give see as I the U.S. And part capacity a the your from that, as hoping And as can it back revert playing you role markets. Or comes And supply-demand

and supply I’m morning, demand for do going setup environment. the on Vivek, to just Good the that

XXXX. what in like XXXX So seeing lot a looks we’re

that We’ve expect order the strength we chasing across continued will be the demand got throughout year. we business. So

said supply. prepared delivered to and are increase continue strong. I be to to team mentioned of growth, backlog quarters markets, is progressive looking sequential by end continued debottleneck We’ve balance in all expand. over to And remarks, in to the geographies the manufacturing of And their our while the increase I expect all the year the that’s we eight As supported process. as they remarks, that the ability continuing

balance is run this expect drive pieces. kind our I strategy. that’s talk that a From and standpoint, a two will On on I’ll that will talk to catching year. things do pricing, have pricing us and the in of growth. an through we this probably so to of let early Why of question, to the up margins will still But bit And let help me we look balance we’re going. longer ‘XX. Vince that sequential eye at going little So then how continue a keep here don’t view are that into supply split

rest on So from that industry the we’ve margins, we passing of have been been costs the higher seeing. along with the

maintain using So not customers, gross margins. we’re but this to of to targeting advantage take environment really

some revenue So pushing synergy we including those of actually items, into is in we more execution, we than which units. is are thought, those benefit But faster have been margins shipping the a of coming higher built because number costs out. mix,

are this then, I So course, unit shipment, on double-digits of basis, shipment year-over-year. also quarterly unit with in a think increase And is unit up all utilizations quite strong.

a to to finish to is talking are how underlying he’s But number I’m pricing, to to on So piece. benefits there the we’re that off customers. – going about of Vince margin pass how maybe talk

a Yes. Vivek, just other of to color comments here. add couple

perpetuity. that’s our we So And very, And supply have an We products pay the we have deliver premium intend value long-term. our for in an portfolio. the us our to keep historically to that our that pricing customers long get to to customers. products. we we innovation very of reflect in security And life also, keep managed approach for

us is for structural also, more I pricing think than cyclical.

into semiconductors I couple have foreground semiconductors the importance more in understand digital years the modern to way. think really the background meaningful and last of from I economy. shown the customers the brought a And think the of value

So cost dynamic semiconductor era, I be is of as the long-term post-Moore’s in business. think, the we’re inflation, facet I inflation, the economic going cost Prashanth Law to said, of a think,

I inflation, medium think, long-term increases will So will to here. for there I but be cost that moderate, expect the

the on it then we place dynamics many, I value of decades. quality it’s all generating more when will over the but in based been think also together, many that in industry. the innovation, new the a benefit put the a is company our I So capture of to think you as better And from that industry these

Vivek. Thanks please. Nest question for that,

Thank you.

Suisse. will line Pitzer Our next John question the with from of come Credit

Yes. ask Good afternoon. question. Thanks And the me good morning, guys. let for

extent sort think price some side going I’m of are Just end And a clearly question relative you of of faster. any to structurally on pricing you than inventory that and parameters growing content markets we will because Vince. x why growth growth now the plus. of your concerned asked in, to just of there to the things. there x, and the follow-up And participate more curious, be I reason that to it’s is give by things, can to be the you’re side changing, revenue we last look levels. and at do relative – pricing Historically, the And did the this kind people significantly make kind seems year’s that year? us? is influenced about does But rates environment growth of pricing

units. looking look of we dynamic. factor curious be so to at should should in and just we revenue, try we on it pricing at probably I’m kind how that And inventory

numbers let me John, on that. just set the

So than or actually, this – should counts year, quarter, for pricing less the current the pricing growth. half for I say,

that it. quarter’s said to process of that Maxim and coming the deal call had price size the we the XXXX, out integration. had were than able in at in cost on you kind push were we we us So closing that helps faster increases beginning on because And we the of were prior

we tailwind So expect we did year actually last cost more year. inflationary pricing headwind had this because

I better then then before I gap. way step price to accentuating creating. cost reduction for had long-term due I’ve keep average, to ASPs John, function the the products the other zero methodology. the to in price we’re that innovation a say, were to to for years prices with was to many years, annual be up We inflation said is adding – we had think that for to a ADI’s had this on gauge several we And – many increase more I’d Yes. going our many, prices, times that comment. more many, would up ship our pricing reductions. of for goods towards units say we one been to pricing and and fill

So into needs. we’re that of keep to for value. company pricing make the amounts sure our we injecting of significant And customers’ we’re R&D ahead

So for that dynamic ADI I the ahead. will the value be, years for for think, capture primary

John. Thanks,

please. question Next

Ramani of Our next question line UBS. will Pradeep with come the from

Hi, thanks sharply Thank think production XXXX? should do wanted can for taking sort we SAAR how rebounding outgrow much your production question. given feel XXXX. in just your that? business automotive my I you how automotive business about about about How is automotive in of ask just even you. or How to

Yes.

I is talked stockpiling. so. pretty lean. lot is with automotive I’ve or that any and last we’re very don’t I think sense established. X right very, over a months the of that That now, is well chain supply companies And the everything see shipping been has used my

in every driven value and the by is is content year. software. it’s – now So activity The sector in vehicles increasing generation auto semiconductors

seeing we’re per for growth of to foreseeable And So I content XX% will think year. that X% future. continue the

surprised been I shift seeing, are the the shift speed of the premium models. I’ve customers towards We And that period. towards XXXX think, the the by content content, the our myself EVs. tilting in semiconductor are

portfolio And both footprint. the the growth to have in a then we where the we’ve a development out, our by manufacturing noise business excited the legacy continue versus our inherited power. build connected be story processing drive our plans which signal high-speed the of as got we’re to So automotive the we cancellations, And not share grow In content product in of that that see strong road aggressive And our growth to value that but able to and tremendous a terms And very portfolio, to connectivity, cabin. accelerates continue GMSL, opportunity to long-term, EVs. have we’ve as well very, least, we story in SAAR. connectivity from multiple creator connectivity franchise, of expect history. cabin Maxim. sector AXB new very last as We connectivity to

We across are underrepresented say, the general in I’d and in in industry, power particularly and management, industrial. automotive

the to opportunity combined there. the sector. is at Maxim a Power tap gives of it’s largest actually and us portfolio and analog the a I growing So, what largest in think compounded of rate ADI to is sector market, the tremendous

our sense a that for gives you thinking. automotive So,

you. Thank

Toshiya Hari with Our next from Sachs. come will line Goldman question the of

demand I much strong expected In forward. to about fair question of good ask to and think a little the X then, had Prashanth, this it’s Phase taking to early. about talked would But realize Thanks we target on the the you kind Hi, guess congrats you on I Phase conservative bit the side? kind than the is quarter talked of for on morning. that how I of And additionally, synergy in to pull-in the looking capture still prepared similar so $XXX I more at assume manufacturing think things wanted the about X, going synergy execution. capture. million about plan, and you. that potentially your could your you linear. consider or be earlier how with given stronger change synergies, footprint the your of did it remarks, or Thank Is as Should a synergies backdrop?

the Yes. us talked Good question, in $XX was be a to the to And great that in of The fourth ramping realized all call, we last in the Toshi. million said we second when April impact would to – invite first into before half. quarter. those setup aggressively minimal more folks synergies half we join there are in And questions. answer going about

more planned than originally faster have moved and earlier. we captured have We

million to I in time that said terms of can And achieve million how you the in that both of and update going remarks, OpEx. roughly believe are in as we goods second about we exit first on split So, X $XXX The $XXX at an we period. $XXX it’s of that cost much – we quarter give will between have actually million. Phase

to about we will Customer his is synergies And high earning going Head Day. is that from will also and Phase Chief for revenue the our our X – at expecting do the We then – plans synergies. on confidence of talk combination. are has April that cost he of – what about Investor Officer Vivek the talk specifically the

see you a here in when that of all lay will weeks. we couple in for we out Boston you So,

Got it. you. Thank

Thank you.

from Stacy come Bernstein will Rasgon question with Research. next Our

wanted Hi about to I my for questions. taking guys. margin. ask gross Thanks

saying sounds I so to boost So, was revenue just at pricing. what mix the And XX ADI hear it’s boost, Is But this look a you the gate. you I yet. are Maxim was and company, And a kind It like margin low-XXs, much mostly synergies on standalone not out sounds more just of of mid utilization like kind are coming. you maybe got and doing the high-XXs. synergies? to XX% it of but have

through be as have you the revenue You progress? about being got to thinking year. Should in going level continue the we bottom year put the for current sort gross as of just you margin QX the

is then on let answered Stacy, the And there that no just margins. Yes. gross faster was at XX%, prepared utilization, execution, up to earlier for which that in is margin the me pricing the unit which would unit and synergy, remarks, in great strong benefit clarify, that. just we are in I Toshiya’s embedded very mix, industrial assume I because the us. wanted again, then about What from synergy to fits also higher a was, into in question. and in incorrect improvement clarify pricing response we double-digits, be The I the talked that volume, basis

So, they are of elements all that.

that model we of focus our company be the the a will the revenue gross we best how that gross April. think to in margin say financial do balancing go-forward operating the terms drive model new continues for In about But to growth on I will to the share how margin. basis, preview or on

there So, higher to uniform that revenue and on necessary to would margin as is met able see the to that like we revenue what investors, agreement are have growth higher they be make is deliver with pretty growth. trades

about more high Day. we would be I modeling Investor to encouraging talk over But very So, be will numbers folks long-term. the not margin model in the gross

but and Stacy, you guide trends, some it around. gross give margins, margins, we don’t context I will how Gross

helps a a at outlook. kind about the That of the at you kind embedded outlook then there. bit. If back near-term will from more up half, you Investor the business. In of about look That’s flat usually for XQ, talk in the outlook. XXXX we Day, our it’s long-term And from usually

so That’s much. helpful. Thank you

from the with will next question Our Stifel. come Tore Svanberg of line

you record to and talked of your congratulations X% come. bit any about more on Thank you know You And first is about the plans? increasing just a CapEx capacity year I sort talk there don’t Yes. this more year. to I Could Thank far results. capacity if know the to little much share moving us have have? that But target. capacity a expansion? on what for quantify would great. this is That are hybrid color does you way as how as be you and to you X% going any can with a model you or that’s you.

Yes.

from our we So utilized XX,XXX are first The well, first, always off, that level, if portfolio, sets. capabilities it the manufacturing support – the we thanks, than unique more Tore. high which just have model And a And hybrid take we we customers. XXX,XXX a of breadth at supplying is ADI. it process us and sheer to technology reach of need product gives

to optionality, technology. use the availability think model for hybrid we about this when and of the continue think long-term, benefits I of So, the resilience we will

to business our mentality, gross are the is And business in it are overall, terms less – and access for I etcetera. is said, also of more it a hybrid given the approaching So with in, margin that we etcetera, process gives long-term capital resiliency options we intensive. technology, and us, that as world

going strengthen will that making model. hand comments on are the we are we will few to that I to a how it Prashant. investments and So, make He over

I think related specifically question Yes. to Tore, your CapEx. was

just So, – let high that let me a me kind of at size level.

going which X% historical between to long-term XXXX. capacity. doubling are that in to for is used CapEx rate X%, X%. somewhere And being our be And that of above is said we CapEx So, targeting internal our we is

demand as an out, should have able the it element that’s that of for if and they model that helps is volume Specifically, the important of same in manufacturing not market it Vince And hybrid that we or with talked being about swing need capacity optionality. the utilization today. can when use so us to same do level

So, Vince expanding to significant are that the back in and complete. acquired in Oregon building that our amount testers prepared we And Malaysia. the and a his of shelves remarks the of adding LTC – in were footprints adding also, we the site in And we in Thailand Phils, our mentioned are Limerick. end

Thank Helpful. you. Great.

Thanks Tore.

you. Thank

will the Our Markets. from of come Ambrish next BMO line with Srivastava question

back you very and dollar inventory. measure you basis, a consistently GAAP Prashanth, average wanted all to was much. And basis, absolute have companies, Thank bit well. that versus on low laid an out. pretty as is quite how I to which versus the for a it’s come the down it Hi. On target we long-term the

was just the and it Could about internally? step-up wondering, channel of And So, think the don’t is I there you where acquisition. talk help the understand, just you drawdown from you heard was I had accounting us part inventory probably Maxim I a from was.

to we Thank on as inventory absolute dollar the basis through should you. what expect we an year? go do So,

great Ambrish. question, Yes,

So first, balance flowing are let sheet. that absolutely purchase is the is me say bunch that accounting a you of There through right.

about of have your a and numbers noise, level But team offline. the bit let with high handle more folks we to So, can help think inventory the inventory. kind probably that me

well not very, the but target. lean, So, very is the seven-week channel, that the our sheet, balance lean. in – very eight-week our channel inventory remains remains That the not below to

inventory our sequentially revenue we of are it having are up to see are primarily, the it very for planning get ADI’s slightly, that I out We mentioned moves quickly. the increase as channel, inventory channel. Within We balance difficulty year. into of days the in building the and books,

the in WIP So, the now that’s comes and of you that raw have in – up. – is that and the of is before is out, material the process middle sort

a had was where the also goods little purely timing on versus process. the in goods quarter of transit We but when that up, ended bit finished were the

So, I except in closed be anything say when wouldn’t our read increase into the just finished it happened it’s to – Drawbridge the goods, quarter. to for

you, Thank Ambrish.

our will last We question, to please. go

Alright.

with Our Sur come of JPMorgan. line question last from will Harlan the

data center I this and know end processor Good that’s management for example, processors. look Google’s to data AI Congratulations for GPUs. and for morning. execution. cloud If on for provide in that grow results Maxim, hyperscale CapEx center strong market, spending I data power critical like they They XX%. flagship power the NVIDIA’s management year, center at the expected provide the And

ADI power side, provide guys server networking the and solutions optical On supply you solutions.

backdrop, center for a in data as guess the full I comps How center you big given percent is your data a is, do comm was driver see business business? the data your question overall how big And center of So, QX? year? strong for my growth

the I you. will with backwards. sizing data for kind I start of of center will answer

it’s about split more is talk if we XX% the But probably you comms XX% you do into wireline, look opportunity in well. I the outlined wireless a What pass it again. of it XX%, will about are our relates why each Vincent in to the going look bit ship center. know center data not this, about through evenly those. little it’s That’s revenue. Vince at to to total And it If we embedded, wireline center where Prashant, am of about between I data data excited. to what probably business, XX% is you and that’s that and and I about pretty to of piece, at XX% go

Yes. monitoring monitoring, itself. power see it’s actually position have We a energy Thanks strong combined also as and as as power Well, that consider, networks, delivery Maxim, I well Mike. carrier phenomenal power but management, in with the a connectivity optical opportunity. we whether system

about you. is, for our sense we X years can next this cloud X talk Day, my my will but the business over we sense the to story So, double and years. the is at and But center we Investor unpack will more data that

Great. Thank you.

morning. We all April our Harlan. in everyone, our this of of available day. be transcript call join and Analog reconciliations us the Investor copy the good Thank on and X. for Alright. A And at will Devices. website. hope joining at Have you, our joining for Day, in-person thanks, Thanks can interest you us a

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