Rogers (ROG) 1 Nov 192019 Q3 Earnings call transcript

Good day. My name is Kathryn, and I will be your conference operator today. At this time, I would like to welcome everyone to the Rogers Corporation Third Quarter 2019 Earnings Call. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]

to call like host to now Mr. would turn over the your I of Relations. Haymore, Investor Steve Director Sir, begin you may your conference.

today's Call. Good the afternoon of that slides our Conference news with Investors was Rogers to be for The release Corporation Third website on everyone, Quarter XXXX section and the call can welcome issued the found along Earnings today.

X. Please turn to slide

the call as materially are economic like subject be uncertainties Before conditions, from note that XXXX forward-looking within conference I statement. those in forward-looking this actual historical Such strictly would exist of to include of and and Securities that begin, demands cause Rogers' factors. considered in competitive any Private operations not we in to many market are Act the Litigation factors meaning statements statements uncertainties Reform should differ environment. to These could that results and

may not can accepted today's Investors our financial Reconciliation the is the in conference which certain financial measures measures comparable measures discussions most generally deck slide the the with found include call, posted accordance to website. directly were section call GAAP that accounting those on in non-GAAP financial this during be of of Also for principles. prepared

CTO. Turning Hoechner, President Mike and Ludwig, Senior today and Daigle, to Senior CFO; is X, me President slide President Vice Vice with Bruce and CEO; and Bob

now over call to the I turn will Bruce.

joining turn afternoon us Thanks, slide Please thank for today. Steve. Good everyone, you and X. to

outlook conditions of economy. Similar our many QX companies global environment in discussing effect both and which and have operating like the softness macroeconomic what some are the we its weeks, Before provide context around results, quarter in in to for the the business Rogers' recent third other would remainder creating I on reported year. the results are

trade demand ongoing some tensions limiting and in headwinds are visibility. cases addition, generating In near-term

These challenges output lower conventional economic to weakened industrial with QX in are perspective, auto quarter. recent market and factory falling late sales. QX, continuing had data automotive industrial further activity, slow the and to which in into third a demand pointing From begun declining

China have restrictions geopolitical In demand. are between Huawei on addition, impacting tensions the in the resulted XG U.S. sales trade and to which

to regarding will of Rogers ability will customers, continue fabricator is to be and sales It maintain the able Huawei's to is on without clear certain components these uncertainty direct XG market. factors there acceptable. our base whether alternative of what impact Huawei's performance While design station deployments is share also not U.S. its have the

to local for A byproduct performance alternative of Huawei consider products. Rogers' even led supply high-frequency sources circuit compared of though these these limitations materials, trade has restrictions have as to materials

success. near-term we our continue strategy Although are of see to opportunities results, key enable very and we these compelling remain impacting challenges our market our focused to pillars on the ahead

our for With mentioned million efforts, efficient this earnings context high-end $XXX per performance, turn now I result in improvement exceeded to of headwinds product mix, quarter. the lower management mind, adjusted and our gross on Rogers of effective expenses net a tax tempered results share. achieved progress operating QX our favorable a of I'll rate. the guidance adjusted the and top-line market of our Despite earnings margin which $X.XX as sales

products in Demand for sectors. certain remained Rogers' strong

product particularly approximately our demand achieved electronics of was For growth leading growth example, Year-to-date revenue to in portfolio. X%. robust portable seasonally due we and been favorable sequential QX has

overall for auto market. sales. remained meaningfully handset Also in Our ADAS year-to-date, results outperformed have applications weakness despite solid the global demand

with higher increasing is new sensors and radar driven the average solutions auto increases Growth increased material number combined the systems of by expected continue the vehicles of is of of key with our uniqueness levels market a autonomy. an penetration number ADAS in success. enabler market as of The of our per ADAS to vehicle adopting

Finally, were relative to in aerospace year-to-date XXXX. is significantly and QX up and defense sales robust revenue

Turning where of sales by ongoing declined already industry wireless discussed. the trade impacted tensions lower the continue recent end rollout XG analyst versus challenges, believe pause and effects expect the to infrastructure previously QX and and QX half Based we mentioned in we XG customer were XG first demand of that upon inputs, collateral in to rebound of the XXXX. the the areas China will due deployments year through the to

Chinese investments the anticipate XG in as We result in continued CapEx XG. a weakness deployments telecoms of prioritizing

for soft and for power quarter. vehicle demand revenue automotive electrification impacted for substrates industrial power in And the also used applications semiconductor conventional

tempered QX results saw we anticipate we QX. segments into continue number In of in market a certain solid by summary, will headwinds that

and We growth. next about connectivity are optimistic advanced for a discuss are as number have recent point And opportunities developments, advanced of in I'll we towards which future areas we of encouraged mobility. significant the by opportunities

X. continue by to slide Within Rogers At end growth in XG cities XXXX. next year increased to Connectivity for as the market forum, XXX to Mobile Advanced where indications China turn their a towards point underscoring increased Please XG target plans. opportunity of for recent a coverage we their deployments see multi-year expansion

that This reached for which have XG telecoms available from not is news advanced X followed already million. service, subscriptions approximately yet recent Chinese

in wireless scale our be Third-party for year. substantial that XG next XG business expect which provide infrastructure experts range XXXX opportunity stations, would deployments of the at base an in growth to XXX,XXX

Advanced to or opportunity would systems underserved receiver solutions the capitalize this Rogers the be Earth. will constellations the to Orbit well-positioned on our LEO is of part large deploy Several on to competing internet Earth enable antenna located tremendous given a needed strength that are in significant is materials provide complex emerging technologies satellites of to areas. growth Low Connectivity. companies high-speed that opportunity within

of services. are also some the companies launch by progress this sector encouraged We commercial in to

company plans in For end targeted XXXX. with example, of coverage in global internet recent by full coverage months in one leading for areas announced XXXX broadband the

increase market report A projects optimistic at IHS the will Looking that mobility, market recent EV to XX%. are Solutions. EVs approximately that of automakers advanced compounded of about sales we ambitious in for and leading through a growth opportunities Power Electronics rate XXXX remain sustainable and HEVs growing strong is for reinforce Rogers growth by expectations These plans underpinned a the of annual this HEVs. and

is example early first delivered in next model brand which One will first unveiled to step This all-electric VW, new annually be to three year. EVs VW's HEVs the is and XXXX. to by sell its that customers up the recently in plan million

all the development Daimler announced in that signaling internal combustion further vehicles. will they engines Additionally, discontinue future to shift focus electric recently of

is the growth Power opportunity is is infrastructure Daimler Electronics to vehicles Mercedes related for Benz XXXX, market eventually plans all-electric to also a Rogers Solutions. scheduled emerging By our to XX EV charging electrify which entire portfolio. bring and targeting

and to increase sales year. ACS from of prior million a versus the were turn decrease XX% third X. Please slide XX% prior quarter quarter of the net an $XX

grown As and discussed strong have is year-to-date remained sales demand XXXX. in attributed compared decline earlier, to this XG primarily QX ADAS to sales. lower XG X% and

defense expect segment QX versus we highly grow high Aerospace anticipate we these increased into rate over XX% single-digit This is and future, and to program-dependent stable the the applications up year. same and consistent for versus and sales at are time. while market XX% prior year-to-date do the results over don't growth demand

be end we ahead, to anticipate soft look the the and year. continue through of demand we that XG will As XG

with However, next the of we rebound in to wave expect the of XG demand first XXXX deployments. half

electronics. compared QX. portable the net partially were strong sales electronics increase demand slide the sales In growth million, to $XX for slight QX, A X. offset a EMS Seasonally to in in EV/HEV portable decline sequential general applications industrial Turning revenue. and in increase drove battery

prior applications year sales in is the Year-to-date China pads opportunity EV battery of have for in the and versus highlighting, growth recent excellent the market. systems pack result the The this QX area. XX% EV/HEV sealing the of lower battery increased decline revenue

solutions. very the the towards of for with progress making EV and automakers are wins battery with We pleased European design other new a are number we pad

of the this to next expect continue years. growth driver to over several a be We

to the sequentially normal quarter ahead anticipate segment line with seasonal in to Looking we patterns. sales decline total EMS fourth

of net a were from X, QX. PES $XX third sales slide to quarter million Turning decrease XX%

industrial in power the electrification and automobiles due semiconductor anticipated substrates market sales in QX. conventional at As of for the declined we weak to vehicle outset demand of power quarter, applications

the declined has nitride solutions. substrates to outlook China strong high-end power primarily lower-end The for HEVs semiconductor of used which EVs soft uses position. Sales EV our silicon due which in be market, to also substrates in gap and continues used Rogers mentioned previously band where new largely are and a wide generation EVs leading

in top PES improvements leadership place. with a new Operational in priority remain

performance plan our yield recovery including We executing improvements. on are

as to look demand be to we expect stable compared to automotive market QX, As and industrial QX. we

of firmly in this and ahead believe EV/HEV PES compelling extremely market opportunity. take to that opportunity is fully Looking advantage we we are well-positioned the

slide X. turn to Please

of feeling impact is macro facing are automotive I earlier, the trade indicated challenges global and and having both in companies as are pause we impact industrial deployments tensions. markets near-term a conventional other like China. XG These in in As headwinds the the

The in growth and the achievement closely the our automotive industrial XXXX advanced by modest growth mobility has of in been advanced tied to markets, always connectivity vision supported conventional markets. and

remain we this in growth explained, succeed our to ability confident I As in areas. and these

increased we exit challenging that these economic rate we the there a market as is attain an will XXXX. given targets conditions, uncertainty and as However, global run

markets tremendous Having broader advanced that said supported to connectivity we mobility the is in that, believe I that our advanced opportunity stress there want portfolio. to continue and by

of half opportunity and with power exciting expected recovery further opportunities XXXX for horizon. XG growth in both multiyear the about substrates optimistic with The a EV/HEV are and solutions opportunity batteries. the first the growth in is equally in We semiconductor

our ability targets. gives All these us grow and confidence of our achieve business this in to

to results to I'll Mike Now, over more discuss QX it detail. turn our in

third afternoon, Bruce I'll you, fourth ahead XXXX guidance. our slides the results quarter In our good followed quarter Thank by everyone. and review

will we for Turning review slide XXXX. financial to the results XX, QX

X% sequential quarter range and to were compared as our million. QX million a Third revenues QX X% guidance $XXX.X previously to revenues XXXX. the $XXX third noted on of below decreased million $XXX quarter basis

the substrate are for Bruce automotive demand demand used lower in infrastructure and wireless revenues. noted XG in for soft comments, conventional as semiconductor industrial his the power well weak as XG for power both market serving for applications, products As sequential applications responsible and

primarily business softer react margin than in mix range for points through and We and and achieved product reduced our market XX%, within QX. QX favorable spending third the due of basis gross QX in quarter, the to a continue guidance expected to to of higher a XX% to segments demand XX.X% all of to XX our

volumes pressure from Our China. continued between the tensions gross by impacted ongoing was the from resulting and trade the U.S. lower negatively margin production tariffs and

$X.X to operating to for expenses Adjusted revenues, decreased the second QX. operating $XX.X million $XX.X XX.X% Adjusted compared income in quarter. XXXX compared by of the or for million, or third was XX.X% million of QX revenues quarter,

earnings rate forecasted an the above levels. the upper GAAP $X.XX fully of both of range diluted and QX resulted EPS but fully a for share our XXXX control per spending The guidance GAAP effective end per below QX, diluted $X.XX performance primarily of lower for good share third were for EPS QX and quarter. tax on from and than adjusted a basis adjusted

million free $XX.X company down has The and $XX.X third the debt generated year-to-date. cash the in million of and of in The cash of net year-to-date company million a million. ended third quarter flow quarter position $XX $XX.X paid

our ACS our business slide second Turning in XX%; saw business of was slightly XX, $XXX.X XXXX. The and XX%. The our second XXXX quarter the to the its to segment million revenues decreased X% over segment million down sequential quarter. increase QX EMS or $XX.X decrease down of segment compared PES revenues experienced

XXXX third negatively China. exchange and from to decrease by revenues The demand million XG QX. resulted rollout Currency primarily a in slowing impacted ACS revenues delay the XG in a compared quarter at $X.X rate near-term

which QX. lower our through compared were result, compared June revenues, through to year-to-date and same wireless expected are declined XXXX soft XX% remain year-to-date basically revenues infrastructure September period a now sequentially. XX% in through to to As the XXXX are flat XG

weak up strong ADAS from and and quarter, QX sequentially XXXX strong defense are growing compared market. programs XX% were auto from aerospace year-to-date in are compared in year-to-date X% the but a were second to of up a XX% sequentially face to revenues Revenues XXXX. X% down

EMS increased electronic for to portable segment Revenues applications. demand in sequentially our strong due

quarter customers' X% quarter sequentially and the down for XX% typically The handset compared to and of is designs. revenues X% General down XX% segment's the which which third our the portable new quarter electronics and quarter compared to of strongest industrial tablet to the third revenues, QX commercialization grew due XXXX. to to comprise application compared were revenues, slightly second close business XXXX

and these remarks, Revenues in respectively XXXX. and by for XX% XX% in PES and weaker demand respectively power applications and experienced for from electrification applications. to As noted general substrates lower conventional QX and vehicle Bruce's XX% sequentially revenue decreased XX% primarily industrial compared QX semiconductor decreased

lower particularly China. in substrate for the EV/HEV applications, power EVs consistent with weakened demand low-end demand third quarter for For semiconductor in

result, sequentially. a XX% revenues declined applications As per EV/HEV

However, revenues up were XX% year-to-date.

mix our for in or gross due spending points favorable lower volume gross than to were XX, basis adjust continued tariffs offset to reduced The of tensions increase XXXX trade QX our ongoing Turning the manufacturing and significantly margin the a mostly higher gross of revenues, of China. product quarter reduced volume. slide the second effects from margin XX.X%. and to million resulting was XX was percentage $XX.X the benefits margin U.S. These impact for XX.X% by the and between of

strategic reflected for are additional see the rollout, intentionally increased cost efficiently carrying the to as to opportunity expect wave we we demand manufacturing As XG next the investments. of address

percentage resulting lower reduced spending business from a to EMS product volumes. favorable were margin pleased the from mix increased with and gross QX, offset We in the manufacturing

see efforts the consolidation gross continue EMS performance margin. to and in related reflected on to issues progress We company optimization

margins quarter, due compared by the in a gross to mix mitigated ACS to QX. declined lower product third significantly favorable volumes

reflect resources of manufacturing volumes anticipated respond our in did While cost additional cost our to third we the to reduced quarter. not lower demand, increase XXXX. proportionately lower in the in enable our in flex with We demand we half quarter factories XG the to the to the first manufacturing in order carried

semiconductor the quarter, by across the reduced applications. be margin third demand our negatively for the all gross power In significantly impacted to continued PES substrate

and by of encouraged signs to we yield third in execute recovery are our the progress on plan continue on quarter. We

recovery XXXX. first execute with margin the plan gross As require we the to contributions in half QX discussed quarters will previously, accelerating have multiple to overall beginning in of and

increasing address structure maintaining cost band in applications. still to the our compensate wide the gap continue power demand to We support ability for in volume, PES to while lower semiconductor our the

basis margin be of $X.X million points increase approximately compared to to XX basis headwind or third points, impacting quarter, a continued Tariffs the XXX gross by margin in gross QX. to an

aggressively our optimize are We to to supply and our leverage of to footprint effect the chain working tariffs. factory mitigate

first as to expect actions the in of of in see lower We XXXX. the the half revenues percent beginning form a of the benefits of tariffs

points to margin, points Relative to points XXX volume the mitigating the in XX impact to through points XXX our is in gross businesses tariffs all particularly path contributing XXX gross the operational basis to improved our third increased and to quarter execution contributing of basis higher contributing PES margin basis EMS XG XXX basis and points. revenues points basis basis XXX

to of changes the net income million. details net QX compared XX for income for $XX.X QX of Slide million adjusted $XX.X XXXX adjusted to

control of million, from XX.X% spending QX measures. operating million, expenses adjusted income earlier, and XX.X% million dollar cost than resulted $X.X XXXX of from than QX the or operating or discussed reduced As revenues income of $XX.X $XX.X of lower of operating for lower a revenue QX on was QX's percent Adjusted for a adjusted basis. or The adjusted expenses lower revenues. SG&A expenses operating both

QX rate effective the reversal geographic rate to with The QX the XX.X%. QX tax quarter rate to rate XXXX of the XX% submission. our mix XX%. XX% rate effective be tax fourth associated XXXX XX% tax to company uncertain of reserves tax and a for The was XX.X% expects to of compared with for lower effective effective effective profit to primarily was Our tax due

XX. XXXX from a a June slide to $XX.X the XX, a and of Turning decrease quarter December of from $XXX.X ended with million we of third $XX million decrease million, XX position cash

on QX, million capital company spent In expenditures. the $XX.X

in paid the $XX $XX down $XX million. $XX has down the we in spent spending debt million paid million debt have and million of the quarter range company We year-to-date and $XX.X The capital in of year of to guide for million XXXX.

The with As lead from of September, increase working times. a activities, generated the in million working we net in million. including Through an decrease the generated activities from are position operating September company XX, long in of million. capital million in cash net of $XX.X inventory increase primarily million, of capital from $XX.X QX $X.X of $XXX.X $X company operating a in

at tensions well of macroeconomic through Taking our in a guidance look softness our QX. as from near-term facing ongoing that expect we certain on XX, are as trade continue to headwinds slide we markets QX

seasonably for and be our QX QX manufacturing to million In we spending estimated are infrastructure, the a electronics. SG&A portable adjust in Therefore, to addition, is In range expenditures. low to for quarter will $XXX of million. $XXX continue capital for weakness, revenues the to response market

will We our at addressing optimization continue earlier. discussed also as yields EMS at progress and PES

will margins volume an continued these meaningful unfavorable headwinds, negatively actions Even and mix, gross QX. product impact in a tariff reduction our in with

we XX% margin in the for gross a QX. to guiding As XX% are range result, of

As The million the terminated was The company losses in required equity. make release, press the additional plan. recorded not take that highlighted quarter. our Therefore, a was were adequately a in fund to contributions accumulated as pension for to our plan plan fourth company other earnings to non-cash part pension million the the the for funded. plan will charge to income $XX company $XX however of cash

a QX we diluted an As earnings we range result, the per share to in the $X.XX for in of share. $X.XX guided On to the basis, GAAP per fully $X.XX adjusted fourth of range quarter. $X.XX guide loss the

the I will turn operator for now the questions. to back call over

[Operator Instructions] And Craig Riley. first Ellis with B. the question of comes from your line

where which them issues the remarks Huawei. by was they prepared around saying Rogers? to capacity got you your situation? otherwise what you for think continue impacting about wanted help they understand they're with switch on help we and solution can with and position goes taking business. that desire just were the the their the gone communication margins flexibility would in to, Huawei? start to for are that have they How all what the domestic gross a do capacity use I found and if thanks and for One, that that Bruce implications Thanks the the different it would question Rogers business to could a about in the that And on infrastructure the degree to do up interaction to following where us

quite that's question. a Well, Okay.

us take let So me through that.

and from to talking performance supply. local seeking view supply I look First, they're while forced and our that evaluating, to think their our regard is really in Huawei that, alternative material alternative an they're with is better, them local for with their perspective, certainly

have said, that being Huawei. of share we high retain a that confidence Now, will significant level we at

thing happening the other that's share shift is among The China. in marketplace in OEMs China with the in telecom the OEMs

in has So, others if some is some between putting that share movement anticipate we the system with and materials some deficiency. China, local would Huawei sourced particularly performance Huawei together

So as testing that's understand we under it.

don't on that very visibility that's progressing. how we have So, front good

the So, OEMs overall, retaining across share confident telecom. as I think move in in all we forward we're significant

to more In capacity, bit terms plans to of capacity on ask that I'm going the have. comment a Mike we

Yeah.

Craig the result think with Price the respect Bruce – Isola Road where to as year. and last So, describing at of at are capacity we Plant or I a we was additional bringing preparing acquired what that

are And for to the We that. are continue continue capacity when point continue at we of bring But time. to we be that some our for need monitor we'll efforts to in speed respect in actually to plans online. bring capacity our continue going we – ready with in up anticipation to situation to to the going the that XXXX

is look question a of helpful $XX million. fourth quarter's the get the contributors business. a what a guidance near-term variance was midpoint on quarter-on-quarter, the It clarify can on just is $XX the reconciling million the color next basis of as are about But of The we helpful. of to Mike, for that biggest at quarter sub-segment and I to third the lot question. more That's revenue decrease you the sub-segment XQ? sequential GAAP between the think performance

are That so the as it's of portable piece and contributors big the you challenge are that's it of the Well, second that the it. significant. infrastructure. be again, volume piece areas think impacting when about in the electronics to is But contributing the biggest right? a say and down that being EMS two is I quarter-on-quarter. the business are is another the quarter-on-quarter. That's primary And would as gross particularly well volume, impacting Those all with probably, wireless pretty margin the the around going volume's impacting decline first so mix

volume recognized. Thanks. company's of The really could with the was like those and you I where it can It in in four one quarters macro in tough the gross macro control at visibility reconciliation items give will progress you model you points sneak make do I get And your it's respect over two do tariffs XXX. just margins. do much XXX closing for it. and and how to Can to some control. said then have with where about the greater areas and The and been progress? two of and out more, helpful EMS you everybody between PES if more the one as making think performance factors is greater just factor insight to in But us the are the looks gaps next we basis confidence three two will target seemed

we go. two still and we've the that think And very good of plan. And quarters multi-quarter would about with on we as today we respect majority Yeah, progress have last believe signs EMS. say, both did than we a But anticipated I higher confidence seen EMS we've quarter. that we the fact make of actually the in the made third in to a in progress PES. I that's making has ways PES progress talked the on execution I – to some

contribution and XXXX. start the we'll fourth in said margin gross in again I two quarters quarter accelerating I as So first of seeing towards think some the

points. ability feel So that, our capture basis it call very to XXX I to XXX about, good

as XXX to talked order what And working was quarter. about other leverage the being address basis The as our we've you we're well And talked one points as that about chain of third had global I hard had to the changes tariffs think we've think think I half we our to can have the have benefit full of some said, think trade hundred I several the at tension quarter U.S. say the To last address get discussions would and with we this footprint our respect quarter around in impact discussions that we'll supply I to in between through in and looking somewhere that at China in we talked least points, about trade quarters. that. or over next actions.

one's market. least a half like of little little that I But bit can So bit we control. the our It's of out a think get at that.

Thanks queue. guys. jump back I’ll in the

Okay.

Your line CJS next Moore with of question comes from Securities. Daniel the

stick Thanks questions. XXXX? for to the And and recovery are feel clearly, as about afternoon. you expectations QX What year-to-date? XG in taking wireless Good was the in think for about I growth of XG wanted good and prospect the mix for we with XG a revenue infrastructure. What XG. your

you're the right. absolutely XG, So,

customers all confident first so the we'll looking go in the to into of industry according we've if rebound We we're things experts from of heard see half have that XXXX, and XG forth. from first what there

we Looking decline. XX%. that we're We and XX%, will next this about think about year the down industry probably be year think single-digits front, high into probably moving at XG, on down certainly,

things. Mike? And remarks, prepared the CapEx talked the a reallocation side we about of this carriers of of bit by a the again, towards the is in So, XG as

a the XX%. XX so breakdown less the is so, XG year-to-date -- ballpark than on little of Yeah, in

business of XX% is still So year-to-date. the XG

current can what we helpful. predicated would things of auto cadence QX Very helpful. QX. of into the color decline Have in And industrial, there Is Any of the that's first kind so you on then of talk far about and saw the in and stabilized? rate the late October? guidance the maybe essentially run month be

think moving we it on we QX. of the will -- today. A situation it So to kind flat it's it's relatively be similar stands from as with QX industrial stable think side automotive,

those to And of terms similar so segments. to market QX of we're both viewing QX in be

is just are from in to lastly continues me, liquidity, even alternative you've then at environment And looking to But know helpful. I the perhaps to cash your priority. soft build well? Very of opportunities cash a plenty given position. as first M&A obviously got net back capital deploy you

No.

thoughts I not think our been. than deployment they've different what capital are on

growth. We cash are really for using

we we'll continue continue where to at that a opportunities can buy for important build reasonable So in to for balance M&A look are that us the strategically prices. stronger sense and things sheet make space

Understood.

Okay. the I color and week. appreciate to up -- to forward look look catching forward next

Sure. Thanks Dan.

do you Craig from Ellis line Riley. And follow-up a the have question of with B.

for the Thanks taking follow-ups.

I to XG But phones in XG the expands nice understand think Rogers can the emphasis is which volumes smartphone industry looks I really next with by from that dynamics specifically that business to dwarf fourth seasonal the strength opportunity has going just it industry in in what would area as the it XG the it's So the and such the significant to to anything saw we moves that your as XG quarter. with see team and a year and with or XG, SAM ahead you unit talk do? about XXXX

months implementation of in the the cycles from designs goes this again, as designs time these XX we six and it smartphones, for to for is horizon So, know months.

now wins end we But timings. those seen new design the world understanding wins team of working terms of is like us. said a on a smartphone what we've very And typical where in so would those in again, historically to that's clearer of this for get designs are up out our mid-XXXX much early I is and number in right still coming But of in. that

Thanks helpful. the longer-term on get the the and related is to XX% CAGR. follow-up color Bruce That's business. then to the ADAS Helpful

vehicles I an been at where I mid-XXXX XXXX, release more I they've year think get the seen you model era in as inflection as ADAS. look always ecosystem an the think of

as have But content? working certainly, step it and year And the lot some in can potential a seeing relates mid content chain, radar supply Thanks. for function systems. customers of automotive next to automotive your what we change give you to you're as safety ADAS as a us you're with insight

Go ahead, Bob.

the everybody. start shift with to Level where working where we're referring mostly X, I I basically you you up. vehicle you're basically think And X is at shift Craig. all I content Yes, again, point so opportunity a dynamic that -- think it's expect goes the as towards autonomy Level of towards, number we sensors per we're to that the think what Yeah,

higher that translated I now. that the All And driving we're sensors a autonomy the per really at vehicle into OEMs right dynamic. most this of real stage. projections seeing would out of with are that's I there think more expectation what suggest that's means think and towards don't level

I increased be actually while on scope a a opportunity. think will good handle we can it before the of the get

Got it. guys. Thanks

Thanks, Craig.

we at like have Bruce to further this back comments. time. turn to closing call or for the And no remarks any over questions I'd

you today's everyone have Bye-bye. joining on afternoon. call. for great And Thank a us

your Ladies call. for and today's conference this Thank gentlemen, concludes you participation.

disconnect. now may You