QUALCOMM (QCOM) 4 Nov 202020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to the Qualcomm Fourth Quarter and Fiscal 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded November 4, 2020. today's XXX-XXX-XXXX, for dial callers number XXX-XXX-XXXX. playback call international is please The number XXXXXXXX. playback is The reservation I like Lopez-Hodoyan, Vice would to President over now of to turn Investor Relations. call the Mauricio Mr. Lopez-Hodoyan. ahead. go Please

call you, will Mollenkopfl Thank Akash Palkhiwala. afternoon, good everyone. and include remarks by and prepared Steve Today's

answer Cristiano and addition, the Rogers Amon, Don Alex Rosenberg In join will and question session.

access accompany our on website. this our Investor release a and earnings can call You slide that presentation Relations

our call is will being webcast later and qualcomm.com replay on this on be a available addition, website today. In

During use defined the the financial in on non-GAAP Regulation to find our reconciliations we can call, will measures website. G. as And related GAAP you

most or We in projections please our from industry Mollenkopf. to results actual and XX-K recent materially will once including filed from materially business cause our include And differ to filings, refer from statements. or to contain could or statements trends events, Officer, make also estimates results or Steve forward-looking of factors Chief events financial forward-looking statements, Executive could now those SEC forward-looking differ that projected future our important business which Qualcomm's Actual the results. comments

priority, March with aligned technology steadfast devices rapidly to commitments breakthrough the while challenges critical number to In the the opportunities We technologies. presenting of accomplishments Thank of simultaneously We the COVID-XX business with forward. onset by products. good wireless an commercializing well workers, our year, XX,XXX their mission we Fiscal set The Qualcomm afternoon, different pandemic. both scaling pandemic globally importance essential want including achieved challenges. as of to a work our XXXX our global you, and safety team environment. our commitment of highlight of top XG our and extraordinary employees for members inventing I partners, as of while a limit thank number unique completely sudden our significant and navigating to a driving was everyone. and Mauricio, our the able executing on the product presented our onsite were operations of as

Both you expected. of As XG of as QX guidance. respectively. our US noting non-GAAP This from underway from impact exceeding ramp a QCT record worth playing of breadth We quarter non-GAAP strong largely results, XX% stages customer. early per the billion end up of partial the of demonstrates of with QCT can a customer earnings billion delivered included XX%, the our QX OEM XX% and large year-over-year. our $X out and result a share, revenues revenues a are year-over-year see $X.XX were revenue $X.X new It's strategy of high that representing traction. record only growth well our our the

organic faced focus of leader growth the transition execute the challenges, remained benefits at with employees Since was you amplifying XG from in XX% our upcoming our January a we seeing leader of an throughout. approximately ramp, a today. While our shares retire $XX ability of billion XXXX to on are spent $XX.XX, to XG confident average to price the XG numerous our

have share dollar in wins of combination significant leading XG of As content we through with business our design see you around successfully product a innovation OEMs can our our in higher world. the results, combined leadership commercialized with

drive to adoption portfolio XG. rapid facilitate unmatched patent XG of foundational and collaborations the the to industry innovations global forward ecosystem Our enable us

were pace XXX Year-over-year than now despite have related stability XX% innovation license more disclosures over COVID-XX disclosures and invention our drive an continued XG are up business. licensing fiscal major invention doubled. Our success continued and in 'XX, challenges. our we at on In agreements. OEMs handset focus All over XG innovation under and accelerated

will which XG in advances and smartphones beyond, of wireless the and enable into We innovation continue industries. broadly to other drive releases adoption through beyond technology 'XX 'XX,

our this unwarranted look despite challenges We have continuing forward to to we now legal fundamental and commitment transformative decades-long focus sustained innovation.

with Over such the in security and artificial wireless as years, enable we areas converge several intelligence. multimedia, that applications, systems built strong and have and portfolios key

leading leadership. in of these play over continue to largest represents history, strategy opportunity as Our early to proven opportunities. extend ability industries. advance is of foundation our impact technologies in rollout new for long-term disruption wireless XG our single well years out great our we to testament investing XG a drive the how stockholders. many our the invent to opportunities This and creating commercialize value will The of success is our many of large will

is delivering now design grow example, as one period with as premium-tier suppliers particularly fiscal RF XG of leadership industries. As a all executed team largest am opportunity of XX% unique technical transition address identified the this other an RF a up is several proud of roadmap the XG 'XX, $X.X to short of opportunity, revenue, we challenges the and wins I how continue has a years leadership, delivered a a of of Qualcomm position ago, experience. In against to RF billion our our smartphone year-over-year. to creating in customers RF in with front-end many across long-term we adopted time.

our solutions be as bands smartphones XG, or IoT in both whether front-end hotspots. Our sub-X, powered PCs, whether products XG modules to and or support embedded XG RF are mobile solutions, they design for or millimeter wins other wave continue they by such

have auto in RF, both positions we beachhead As we have in IoT. and built

adopts these us profitable multiple cellular industry scale a each technologies. Our to enables in areas expect bets we make tailwind roadmaps as of

place taking automotive see major products. the nearly with can OEMs adopting our as through you industry, partner emerged technology all today a have strategic the we where in automotive, As

addition cars. design a telematics solidify in wins wins XG connected as design position Next-generation our XG XG to leader in and our

RF include our products. extending also and XG design mobile automotive-qualified front-end a of are RF of generation XXX% our automotive, into leadership next where telematics We our our XG majority front-end next-generation wins

premium, tier solutions. the entry In enable capabilities cockpit addition, our now across and solutions in digital best-in-class mid third generation

automotive giving into visibility now is at win last $X meeting from the revenue Analyst the almost the approximately long-term $X.X pipeline provided November. great at our billion, rate up to well-positioned The and us our billion Our targets smartphones. fiscal Day we start in of design is at share with auto opportunity incredibly industry dollar expand unprecedented we a have are long-term lead to industry done of automotive an transforming we the content as in year,

connected our connectivity, a from IoT, to technologies, products we into lower the are and with across investments Turning of broad non-connected security. portfolio portfolio extending including our of processing, Company and power IP

product in revenue IoT In better-than-anticipated networking, diversified verticals. industrial, largely retail, growth we by performance with and areas 'XX, demand also saw tracking are have as driven verticals across strong industry XX,XXX we customers. multiple utilities We fiscal in and nearly

WiFi into toward position. wearable record also drive continues our looking companies. put ecosystem a our access to well Our consumer We've high-performance solutions WiFi has broader WiFi levels. evolve, brought our of solutions execution leadership forward, as XE continue Qualcomm point And OEMs, the smartphone on to product to WiFi as

technology and of consumer also leadership over choice. XX enabled and establish position physical a XR or have and are that spaces roadmap Our us commercial connect enterprise the in solutions Snapdragon digital platforms to inventions, devices XR. With

of low-power XXXX. Snapdragon been have performance the high-performance compute in first and launch cost We of driving curve since our the

investing significant opportunities edge next-generation today in infrastructure create also We are will and areas several that compute, believe years. two in we

position. that enable to will provide to us a technology is achieve differentiation objective Our leadership

with Internet, transforming converges networks virtualized. the are As mobile cloud the becoming wireless and

Jio. provider and Beyond for such enabling virtualization providers, service Rakuten infrastructure seen as with operational is you and the intersecting cost have benefits with is service where new models, services digital

technology inference, edged platform interoperable XG. announced provide modem to billion infrastructure as Building extend and and the signal processing virtualized over infrastructure. centers, smartphone technology with as transition recently Radio a cellular AI for our with will offerings. into will Turning by of applications low high-performance platforms we X XX R&D AI such Access XG well-positioned and our expertise, leadership years Networks, fundamental expertise, growing are process power leadership on trend our compute, and foundational ecosystem RF over assets devices appliances These we driven RAN node and accelerate such data enabled AI-capable towards new to and XG and our

Our products property, turn opportunity. growth intellectual commercial spectrum and are we the expected and for differentiated millimeter a expanded technology with over helping by Akash. leading multi-year sites to global bands. calendar are Together macro portfolio In will roadmap XG to which include XXXX. with gigahertz summary, with key now product we vRAN XG, for micro wave like transition to drive the call a and scalable year I well-positioned all would from partners, to is across sub-X our integrated support

Steve, afternoon you, Thank good everyone. and

key We challenging resilient year are report and a quarter strong to to pleased which remained we in several another business milestones. extremely achieved conclude

our billion of record $X.XX. quarter fiscal GAAP by delivered and the in respectively. in strong QCT. revenue fourth guidance EPS, for increases delivered revenues QTL and came and of end non-GAAP driven and EPS and year-over-year performance revenues $X.X non-GAAP of results range high of of of We with $X.X XX%, billion XX% $X.XX both above We EPS Our

shipments handset markets, by of benefit licensing In these approximately we million of with range. the previous reduction. we units, XX% on shipments of and delivered In This upside and reduction in a periods handset our recent MSM $X relative above following prior strong emerging The In impact the global our XG, XG, QTL, reminder, billion end OEM Huawei. saw end QCT, XG rebound the range. EBT results was settlement our by shipments driven driven include a guidance X% quarters. revenues higher global strong year-over-year our a As mix. which results in of in XXX prior to the assumption of to $X.X and of was guidance a COVID-XX planning demand related was a revenues agreements the of from quarter, fourth high high margin we favorable both XX% of with of handset upside delivered above billion,

of our RF XXX%, XXXX saw automotive, growth XX%, $XXX reflecting pleased as $XXX front-end, are XX%, higher automotive the I growing by we increased revenue and strength $XXX EBT products traction to design cockpit We're the benefited long-term million. EBT increased a our versus of In our non-GAAP were basis, billion, than will environment and growth home at revenues year-over-year XX% $XX.X major provided digital results achieving of OEMs. fiscal environment margins to in due driven COVID-XX, segment. to respectively, of connected opportunities up drove and on front-end our XX% industry connectivity to had of XXXX. now million the economic work IoT. IoT, we EPS across fiscal and target QCT industry XXXX. In challenging due Analyst of for Despite report and handsets, for guidance from million, from excited the and the $X.XX, rebound. this we revenues revenue prior about handset Day. summarize achieved demand telematics, XX% $XXX XX%, million revenues in sequential to devices sequential respectively RF We

including automotive we and executed building license of RF addition, completion XG on several growth a key long-term platform in milestones, the agreements, front-end for of acceleration In design and traction and IoT. long-term

handsets, solution, announced including regions. millimeter-wave XG development. all to which or XG using that Turning now have pleased XG now to we to OEMs are major for handset many select of XXX designs total, we system our commercialized modem over In are have smartphones, in see antenna

year-over-year XXX high We handsets. to XXX of units XXXX In to bias calendar of XG for we handsets, of XG end forecast calendar the million the are previous XXXX, million maintaining forecasting a XXX% towards at XXX midpoint. our XXX growth are our

are for the XG, outline enhanced saw in provide year-over-year a and disclosures versus digits global the estimate opportunity categories growth XG provide and will calendar will this impact quarter our XXXX. going now in of This each I our are calendar X% for planning outside implies assumption XXXX. we of decline handsets handsets, revenue September This with actuals with tracking IoT. we our RF not guidance these handset for high-single quarter. This approximately of December using disclosure QCT calendar by forward. the we breakout is MSM consistent front-end, for going forecast, expands total For XG, quarter's providing of our growth Starting With results, to decision change, allow XG progress forward. as or automotive will we mobile. revenue this XXXX

additional Day. XXXX In historical to change Please framework we consistent at the outlined addition, for refer our website revenue Relations Investor Analyst is this and breakout. our detail with

to fiscal guidance. first Turning our quarter

margin and $X.X EBT XXX% $X.X of revenues to and billion forecasting are billion are of $X.X with $X.XX, $X.XX revenues We strong year-over-year estimating billion earnings non-GAAP of billion to midpoint. $X.X respectively of the In a increase XX% to at automotive we we QTL, EPS and to billion reflecting across year-over-year XX% driven revenues due of launches XX% up QCT, to $X.X front-end, the RF at of midpoint, IoT. and XX%, seasonality. estimate and a flagship to billion, $X.X handset holiday growth increase sequential handsets, by In

We of expect QCT and XX% $X.X XX%, reflecting the versus to an billion margins EBT between EBT be period. year-ago increase

R&D sequentially. X% SG&A anticipate and to up expenses non-GAAP combined we Lastly, approximately be

forward global quarter, of a to after on outlined second the Looking QTL with and now assumptions based to we be the quarter to in expect billion $X.X seasonal second shipments. be previously QTL the estimate and decline launch to billion. QCT In the revenues handset the the handset, consistent fiscal range seasonality holidays, we $X.X of following flagship handset XG I

costs. the employee-related normal expenses typically SG&A year higher As second R&D quarter for includes as fiscal reset the in a non-GAAP certain it calendar reminder, are combined and

XXXX, quarterly the consistent the second seasonality for both half QTL and fiscal shipments. businesses the profile expect with global our of the to QCT of be For handset we

we of interest each quarter X.XX tax and forecasting in for Lastly, a annual $XXX fiscal weighted effective shares approximately rate of are outstanding billion million, XX%. average XXXX, non-GAAP net expense of

executing drive our turn to commercializing at growth focused that on now you. Day. remain Before call on our for Thank operating thank this I'll employees with the many will revenue XXXX to prepared are focused remarks, on fiscal unprecedented years. XXXX, XG I and we targets the outlined delivering roadmap financial throughout In want contribution we and for line year. breakthrough Mauricio. I We finish growth back Analyst our technologies in leverage my their

you, Operator, are Akash. for Thank ready questions. we

Walkley Instructions] with your Thank comes you. Canaccord Genuity. with question. Our [Operator Mike first Please from question proceed

Greater. well Thanks I for -- hope on questions. thanks for taking my everybody's call. the

think there. investments? harvest the strong perhaps QX, trends guidance Just see for higher a but QTL XG question we you some on margins and seasonally very growth just How legal margins, the should terms areas. Thank implied for in in also And new for of lower EBT in you investment highlighted strong about margins QCT maybe QTL, your you. as and some expenses

Really a in margin we than guided quarter I we is quarter. -- have get from are margin to deliver mean Mike. of and This Akash. that target XX% anticipated. in first that's XX% are see to QCT happy midpoint perspective, the had us sooner Hi, all happy we we September the a to of a extremely

well that's saw, as in guiding the strength QCT. going XX% you into As are quarter we midpoint December with at the

If then the things that As have QTL mind you let we the of again. me keep seasonality go and in forward, just to one is -- of QCT the address businesses.

strong For that impact. overall the QTL, December, in given kind seasonally of holiday quarter and happened then handset launches

so play able be data financials had would beyond you in of March out perspective, guidance From a you'll really of a our and As that kind that the you rest second we that, actuals September, contemplated to margin will data a the given forecast our at -- the Day Analyst guidance and how go year. QTL. And those point. between of we've provided quarter, points for then give for

consistent So very that. it's with

don't guidance really have to point. an So relative that we update

think have seasonality. -- QCT second at years, a look when quarter go based saw happens first or of just For this QCT, seasonally it's of December you now strong. quarter quarter about business flagship with three the couple with what you handset where a of last launch chip the between changes with to XX% very is different quarter quarter in guidance, it. drives years, revenues our and typically, of launch as four seasonality very you though The It on in again, in the our the -- almost is and decline we December XG than strong back

so From of be more in going And on to a change perspective, based seasonality and we forward. revenue that in QCT margin first as forward. profile quarter margin will reconciled margin then strong the we'll the move the really

you. Thank

you. Thank

Our Samik with JPMorgan. next comes your from with proceed question Chatterjee question. Please

smartphones, just meeting strong congrats to which start better exceeding think couple Hey, doing or in smartphone. wanted of questions. you targets results I start the the a the RF is outlined guys. on have question you for 'XX. and into than pipeline on -- have should clearly on the content, for even results, I just on on taking How which off here. you outlined off, RF Thanks visibility Wanted the you fiscal we the expected, either based you about to

it think that I was the you Analyst about billion revenue of outlined $X.X at Day.

have can a follow just you If and I on your thoughts that share up?

Akash Samik, again. it's Hi, Yes.

target market fiscal the forward perspective billion XX% than seeing we of across happy very a played an guidance design think front-end, RF business out, you'll for the way to we lot Day, as not more in reported be has from recall and strength, just I just said that our the and with $XX the and really a term share So we was we're RF at but quarter quarter, for expect Analyst in front-end 'XX we pipeline are board. the in seeing, long win really

optimistic our very are -- beyond we'll kind to to we our sooner, get updating that, able not be at that of longer-term guidance really we're get So this to point. but target

Cristiano. Samik. Hi, It's

Just the continues, to -- one prior feel the The the designs, of to we pipeline, so number those you. of end as some attached we continue front designs see pretty grow for to quick trend XXX, to good XG about that increase we comment business.

there's competitors volumes industry helping could or results. the that's business restrictions I now? impact? be I the results Huawei your kind if headwind of should in follow of kind it the changes about about been impacting How up, think is lot of And kind proving more, of that on how Is -- a with that, think our or the ordering to I here a to Huawei in right right. current how kind should smartphone to obviously, impacting of just All environment restrictions view

for Thanks is Cristiano. the Samik. This question,

n expansion to don't to creates haven't and our traction with you given high the know, Huawei, positive and with our and to all the The receive we earnings way premium if it's very So QCT said we have a in that an an on license the expect demand we consistent we that for as opportunity at play for the or products We whether last long an TAM tier we're opportunity right high of we handset OEMs, we actually Huawei, in now, position look sell you QCT. not in the think Huawei event see a customers, of as our [ph] net that hedged fully to what the the run, in expansion a Huawei. should license to is XXXX. this about that opportunity [ph] as for market call, and -- out feel selling we towards addressable

Thank you.

question comes with Please Cowen. next Ramsay Our your with Matt from question. proceed

December much. upside afternoon, the really I the magnitude maybe about very maybe business. and versus partly, in And and RF to everybody. chip you bit you then maybe could Akash, units units given QTL little to ASPs the maybe help the the core that Cristiano us a in is quarter. of you talk Yes. upside for or just this rather, QCT for by outlook the Thank and business in in the down break also Good appreciate guess, disclosures question additional modem

all so the we can that just quarter give of out the and magnitude gate? at model least upside disclosures, could change the foot this just the you. sort Thank given there the some us help If you for of just of first in

Matt. Hi, Yes.

disclosure and to for our transition, was driven than XG years change. to RF so driving seeing run just then of key revenue different has last role XG drivers of do me in we IoT well. as and units by so set of it's more playing a content, the and the a What evolved growth and our front-end growth through obviously are bit business let So, wanted over a quickly really we kind couple automotive

consistent the it that's Analyst behind how with will then goal it's And we kind allow our track area, Day. And core very with process points to of thought investors data the again, this in progress then to at so outlined was it. business give our that the and

as which in of those September the demand the the is disclosure an As a there drove the then breakdown, you need devices in areas, strong across from for for kind connected strength. a increasing rebound see environment permits, we've of strength in that on work lot IoT we And of growth and you've also on a and the home was driven a quarter, just connectivity. seen each by saw side, significant home given a auto

trends kind those expect of look holding quarter are going for us, next a we those all so of of for each As similar forward, areas. strength we into

our drivers We the the really not total underlying breakdown a providing it strength level. forward. are are of obviously remain forecast, But providing all looking we QCT at those

Thank you.

question. Our James. next line Caso comes proceed with Chris from of Please question Raymond your the with

Yes, question of first guess before. I the the I and sort the to was quarter QTL, that for levels the thank guess, quarter results September and the is referred what you. above with you've December normal regard guidance to for

So talking explain is about you permanence the QTL case revenue? normal guess, level what this I quarter well. going -- this March you're that's the of of a and Is why as if business for forward the the could level of and sort for new and

Sure.

Chris, the the because impact of was approximately March was COVID quarter, quarter So, market XX%. As recall, you the June XX%, down will of and in

is, XX% couple planning we lower demand our following markets, especially saw forecast, we assumption because was into emerging a the quarters ended up going a of Our the went happened and down really in September and what approximately down the COVID, quarter X%. rebound demand quarter we're of

September quarter. helped the that OEM we in as the a that performance for So And kind mix was a QTL saw driver our bit of stronger key addition, in well.

results the data of So $X.X for billion. September that's at our quarter point for the kind

it the in for then kind X% we of the $X.X March the Our really December forward quarter into and projecting and guidance for market midpoint provided. impact, is the basis the that's quarter impact forward just same numbers we into projecting QTL year-over-year market quarter, saw the billion September of that that

along full about project the the think of year. a -- year September guidance, quarter the for for it you number a good with and quarter quarter forecast As the March to kind way December QTL, using that's

the you. now, that is RF front-end talked provide business, contributing handsets, sort you some on around said seen could must-have to what of Got help what's millimeter-wave know of color the a the content it's an then terms increase being that Thank front-end of for And proliferating to other you're must-have I it. that something flagship is important question now the on lot. quantify business. us becoming do you much you the has been about in anticipating millimeter-wave how geographies? a kind to A of RF world for follow-up that millimeter-wave? that business we've you, And you've potential a if what's in Could for part millimeter-wave

Yes.

I'll the follow Chris, can take up. So, the first question part then of Cristiano and

of revenue design base, revenue of RF that, are XG obviously front-end reflects have driven the portfolio. you our should our portfolio really not providing XG our and think Just technologies but we broad millimeter-wave strength of of our a breakdown being from across XG, and traction technologies, not sub-X we a millimeter-wave, by

technologies. really it's across So all those

Yes.

Cristiano. is this So,

does excited as well in of I and diverse the points how add to the so drive it you a lot to the converted significant into is had of business growth. more data lot probably we're first I frequency continue started front-end Specific would think -- multiplier what we're content, build happy on to And we're our of about with for RF is. especially it RF is win remember. about said, potential XG want show So XG, broad on some some content even higher if just in to that sub-X Akash millimeter-wave, average starting X.X it a front-end get

States, you have significant there point saw United have millimeter-wave such very launch service. the the our the tailwind to millimeter-wave requirement especially XXX becoming we services a see attach in be as in September, And in we Korea to as price launched addition, with United States is for now for And for as markets that back millimeter-wave. a business. opportunity globally reasonable tracking still going investing devices, operators Japan, DoCoMo been In

maybe has technology outlined then year think what millimeter-wave that. really add And play we so we had a happy of very is, to vision and see I consistent deployment we're what quick with out a happened will everything outlined just to really ago how is comment, for happening a and the

you. Thank

question Our Joe question. Morgan comes proceed from with next Please Moore Stanley. your with

Great.

the think been seems sustainability some most is away of just obviously, and it inventory I It get take try I from to is to Huawei shipping. has question like investment the share robust. the handset there very still has builds, Huawei yet. still

you the the characterize generally the into can So environment of just you're heading that environment and strongest the in part handset inventory year?

Yes, hi. This is Akash.

and the how uncertainty seeing So we mix, out. things OEM certain in China given play of the are especially some minor elevated OEMs, demand across

in already that's contemplated forecast. our So

forward in As we and commentary. look forward -- our

technologies or where it, share. our win we look really portfolio months. earlier with we're very allowed and As some when really just up that, the and traction, well But made take from to design it's forward, at really whether set step customer you up who Cristiano the if benefit it's that uncertainty as ship consistent back and to from if pick pipeline -- look expect are few over comment other we next overall our to Huawei, OEMs them

should Okay, great. are that we at supply of? aware Thank there all foundry -- are on is then constrained you. capacity, constraints guys there any be you And

I We're few a supply Cristiano. probably from This the one the of standpoint, now we're is diversified companies supply Joe. Hi, very leading think diversity. that have

of to a probably, about look big We're we you're year there XXXX. how upside. have this going demand, of lot supply, our the in good demand seeing all are and will driving we feel as We some about but supply say, we I [ph] see tightness

you. Thank

Please comes Our Barclays. Curtis the from Blayne proceed with with your question. next question of line

good Thanks my for taking afternoon. Hey, question.

that people seeing And have it's but perspective of to of in where a the already with close the up and today at pretty XX% you XG. Kind you kind the looked in just the we're seeing sort follow of builds, I build guidance you're some saying, market, kind and anymore, stats rate to now, where that getting curve as you're then builds parse adoption at together, kind of [ph] at of the a have of on for curious strong trying question, it do China mean look from visibility think basis? models, just then on are quarterly already you're XG not MSM we any of I just run kind Joe's XG of curious already these

Blayne. marketplace. a emerging became Cristiano. markets in XX% market, even impact you question, lot see points how very the XG. the of as that more than driving this of accelerated points have outlined and When as the wins markets, expect of going we and last prior and quarter, to to probably emerging new well activations very We regardless price very hedged like we're This with handsets lower saw we for is happy an as of that's the with the unfolding China of we're And Akash China launches because the the phone well. all in that in new XG about who in China Hi, aggressive think the XG transition all provide of starting and position price we're

are the just XXXX, million that's the for of side also additional a which data a devices, XXX at an on on point then when forecasting look providing really to million And to the size we we XXX basis range XXX% growth. you XG are total of market year-over-year that add

were calendar So And we going that extremely the growth velocity as going it. -- 'XX. year we exit that into strong into seeing XXXX, exit

really up segment detail. be I'd you the $XXX just about million it know gave, a been it's the [ph] to of Thanks. at answered that up When a bit around curious details of modeled more you IoT segment, the you you why so then kind little liking like it's a much. running follow quarter. appreciate looks to look history back it And

any forward, does going some business at push, perspective put obviously, how seeing higher strength you that will as to prior, here trying seeing just work great. has this from I'm home So a it think levels just to of or move be and roll-off been about but context the in big forward you're everybody

Yes.

So, if are we on website, on 'XX disclosure a fiscal annual basis and providing quarterly at for on detail an we basis. have look 'XX the you our

think about the think then and data Day to on so grows there last maybe there the the enough IoT the come in SAM commentary opportunity? forecast be grows interested business. of SAM a to a we and long-term kind I and way you way, and how growth segment, [ph] at you with of to some so, for the able look thinking at Analyst parts a outlined we And vision then our trends be up and that And for good and go back where is year, the I'll same of how that could about you'll that that are --

also lot is have this I you as qualitative transformation, out, some importantly, but the driving to going this it's an other XG transformation of you you Blaine, industry. pointed is there Christian. connectivity, If most comments, a have digital home, accelerated enterprise of could add

good of and XG is industries this it proxy vision us for forward. a growth business what probably as we a this going is of other So, business realized in today,

Thank you.

Bank. Seymore proceed with comes Deutsche question from next your Ross Our with question. Please

the a congrats Thanks for question letting guys. me a follow-up results. Hi, and ask and strong on

think into the revenue $XX above It's to does see back MSM have, going end is in at and that first X.Xx if appreciates going a per market and you're it MSMs content before everybody splits The getting or to the to to one I'm the your XXX% XG just one but have next for side. I disappear is looking the than to that more on largely be the I year, is or other. the per that you've really per the framework you're continue that dive increase forward, MSM what revenue both is, units good. guess a great the and on MSM I wanted side unit it so tailwind revenue capturing $XX going gotten

over still Ross, of Well, then we to from between technologies. within think margin market unit the perspective, really transitioning a framework really of it's XG, -- it's less so a apply. And kind XG, right, the unit a growth it's transition XG story,

top the side benefit and it. a opportunity then core the is of chipset incremental there RF is on there So, on

I follow-up, side over things. And my want the I margin Great. guess to for of to switch

calendar first for about the bit OpEx little calendar a quarter quarter Akash talked the the the fourth than You fourth or quarter.

trends hit little should calendar of You that side we on or said how 'XX idea sort you've general about 'XX think on the now QCT of the bit, a up go targets, especially OpEx it or the fiscal equation? the exceeded your of any for side for EBT,

Yes.

to numbers, quarter leverage are seeing happy of grown our So, we leverage as first see quarter. fourth that up I show all, revenue first the the and margin happy mean, in see we're operating -- -- the to in has very so

points think to As data soft to OpEx reasonable for project first forward those we data quarters, gave for of have very quarter year. the those then we it's both the for and forward, following I look use guidance points two for you the quarter,

is Steve there just remarks, Analyst opportunities as said few with of of what term, The growth are so opportunities organic long consistent for we selectively all and those the we areas in as we have at we his other a in say the Day. lots outlined thing I'd in investing look for forward, are prepared --

Thank you.

Bernstein Our from question. next comes proceed the Research. with Please line your Stacy of question with Rasgon

Thanks guys. taking Hi my for questions.

but wanted December at of sequentially in don't your is what because expect, know bit think slug on to mix statement? provide margins changing them, first quarter in gross margins. chips of and mix, my little little us For qualitative you did. I a an flattish of coming chipset that the a bit I and quarter contemplates with into that one, they even I were least to like In gave down say current it a margins to come little the accurate you quarter, gross in revenue last color to gross guidance the actually dig I know supposed Is fair somewhat.

there highlight we to isn't want that a I something mean, gross margin from Stacy, really Yes. perspective, on that topic.

what I feel something trend going have we is holds think forward. like what and very consistent that's we we -- that

it. you. Got Thank

And my the ask follow-up, RF about trajectory the I so to want business. of

RF modules. of RF all into the ship together So revenue with of bunch RF had revenue or this rest to of platform of obviously the does like that ship quarter, does before go have and that a you some

the booking the guess coincident I you is all you're each I'm of going shipped So are for what RF some QX? of with that revenue platforms is, they chip Or in asking other? some actually in into QX that

Yes.

of a think fundamental timing a all are module, someone when factors, there chipset. the go There aligned So would business, If RF be with about right? modules would we really those make But we the timing there -- just are would shipping be you remains related is shift really, to the broadly and same. times combination ourselves the as module those it. else's comments, components in that into trajectory are timing-wise

Thank you.

comes Steves Our next proceed RBC Mitch Capital with question Markets. question. your from with Please

Thanks Hey, for the one just I breakout here. to kind taking back guys. have my question. just of going QCT

I any the about detail significantly looking a double the look terms then to is looks in there to your like sort we if but we the you're mean, that. look about digits over, low targets. SAM board? good for is of SAM, being correctly be over just And it modeling we how do I Just guys long-term think to a of kind of higher kind out think 'XX able the there would four of going that be helpful? segments we So you outgrow so at year, should mean across guiding it's than implied bogey number

Yes.

think businesses. to think model to at of terms we those each are Day. relevant segments, of very I the our in longer-term We of kind gave disclosures Analyst some still of modeling metrics use

on XX% gave than you $XX a SAM. when So think billion of we about greater dollar disclosure RF front-end,

we longer-term revenue a side, auto disclosure target. on our had specific pretty the On given

so should growth what within the able that really market then really on. it's should that And be to addressable components the we'll -- -- what's And more market faster that the what's SAM then, be and than about participate growing the IoT, -- instructive. be are for are of that us,

Understood. you. Thank

you. Thank

your from Rod Our Goldman Please next with Hall question. question with Sachs. comes proceed

is know that supply Yes. Thanks I wanted in I world again. has about with the wonder in been follow-up? disruption bit again likely just contemplating fiscal of the question. and thoughts for chain most And some you have I a on just about have talked parts chain for and for disruption potential ramping or you production COVID And that the to supply continue talk QX to participants your that, industry then could up the do some I start certain a believe little is if guys normally? guidance your the

Akash. it's Rod, Hi Yes.

our quarter -- really so really that's our supply can are the and we forecast. is in constrained We guidance for by what contemplated

your components own the seen a millimeter-wave assembly probably, we've it lot of else's process terms talked know I that, And Okay, your effect doing module. preference great. an follow-up is for of sell looks your like Thanks, also willingness about module my early but back Akash. was millimeter-wave wanted [ph] then components, I and to a on, to have sell to business you in come net any way someone the it's do or you some of guys there. interest then

I So those it to two the I'm side preferable just if would -- one do of of think preference component do that and is about us someone really a the I have for module or your which let is prefer. it's another. worry curious, way mean things don't I things -- go but you preference you you or know

how do that wondering forward? you business Just want to going

by transceiver have together modules have the Rod, our and Look, we a in about technology having Hi Cristiano. requires commercializing side this We're side. itself traction millimeter-wave. because you with own module we're silicon the to as have module. front-end well is flexible, the commercializing feel working the RF our happy very been we're within I as

a in lot for direction having customers validated the you standpoint, solution scale general The from complete important is fully a we a performance R&D. and from of when provide a them we save that is standpoint

they So for we'll our flexibility to as continue see the maintain value. customers

you. Thank

Our question Muse question. next of your from Please comes C.J. proceed Evercore. with the line with

you curious, guess for that about provide question should the around thank you but those think first overall the margins thank you the how to could some the disclosure Yes, sub-segments, each business? on help for taking for of QCT I PBT we for and my relative question.

point, at a C.J. within businesses this QCT. portfolio talking really think we're of I about

this pools that opportunities discussed mobile, especially appreciate As the across. addressing one kind the some and set from and really auto one and we're of we technology and past, premises the in of IoT core incremental of product is I'm of sure you leveraging of it's technology how and leveraging so we've are

margins. segment And to so best total on it's QCT look the at I think

is talked on XX-nanometer And that's Okay, what then helpful. had the as from the guess I side around of least constraints. things And available. the that near-term supply issues has because foundry kind a There's I about you you're SMIC, impact and question on of impact has on curious at and believe my the what follow-up. getting capacity only TSMC pricing guess earlier that foundries, I

foundries? love we hear thoughts medium-term So to would from sourcing perspective from on near-term your and leading-edge supply both the a

C.J. Sure, Yes.

foundries. across a our different So from foundry we're diversified really of strategy is very lot

all pricing for period partnerships time. of reasonable we locked So and are a close negotiation typically up have of went them with from a we perspective, typically

no are maybe we we operating our this partners. supplier impact point, just at as with And would so really, I'd say

Thank you.

final comes with Arcuri from Timothy Please your question with proceed UBS. question. Our

of sell-through is wondering in about of units. total click on sense XG, maybe Thanks talk of in you give a the double I'm the China at But could year give And I'm the or between the revenue units of wondering if question, you wanted just can us XG if see to could government today? about -- My data XG sort about us because lot. first and don't maybe of XG, how look split XX% talk two-thirds QCT want a month about was terms Can XG to you I QCT we I if much mix. either if and if QCT to and last you on date.

our about probably the really way Tim, Yes, to total look at best for is think to forecast handsets. this

We next year range are range and of then to for calendar at a XXX million million. XXX going into providing million at a XXX XXXX

XG OEMs. our XG between reasonable I about then so those to mix applies think you are And data it think for think as business individual and to points about and market the

is for wondering with guess, could to I I us RF September that. I ask like. you maybe the [ph] that divide And if breaking in get looks is lot. the not I because MSMs, about right help about $X to at just Okay, mean XXX% per a obviously what million business. the attach that wanted if us actually out of sort a what attach XXX I rate help it, look the business? attach think Because the rate Thanks unit. now. you can by that great way It's straightforward had but Thanks now okay. you for about very RF maybe the also the I'm And rate XXX

Yes.

OEM in device, right, multiple specific a designed it's a As between tier we device quite which being market between which really geography or t think geographies about SAM complexity the there's changes bit. of for per business, tremendous addressable that is, millimeter-wave. The sub-X RF business, and whether

And we we addressable position so think attach our an rate rather not as as and market try of that. think available we within an maximize it of to try business to it

you have Mollenkopf session. do Thank call. anything further to you. before adjourning That Mr. add concludes question-and-answer the today's

Yes.

the you Just thank to to employees.

culture difficult keep would I a demonstrates working say but think more to businesses on, I can probably of this of quarter ability things company of than on-track time. very the the we're quarter its really in not and I the only the any strength and think products also that the

the So, Bye-bye. a you going. for your see market hard lot. Thanks it much in work. very that keep and the of It's recognition to thank great

call. gentlemen, and this Ladies conference today's concludes

You may now disconnect.