Allegro MicroSystems (ALGM) 1 Feb 222022 Q3 Earnings call transcript

0:01 Good day and thank you for standing by. Welcome to the Allegro MicroSystems Q3 Fiscal 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions]. like Ms. the now your over would today, speaker I to conference hand to X:XX Blye. Katie Ms. the Blye, yours. is floor

X:XX Good year morning Executive Officer, today today for Derek and Allegro's Officer, thank you third by Allegro's results for Ravi quarter D’Antilio. Vig; for Chief and fiscal President XXXX. and joined Allegro's I'm Chief joining Financial us

We our quarterly summary outlook. our will financial a review of performance and provide

other X:XX forward-looking be discussed expectations We're than measures is be available to shortly. are no are President call our results with comparisons our include release future a CEO, our the cause are our measures and assumes or and earnings posted about providing because subject events and call webcasted may release, the Our calculated will any filed that website. statements operations. defined turn that we in by the issued our for of statements made of reconciliation supplemental Relations page materially risks that factors today's IR note detail the I'll be presented. financial recording are are the to a as and IR on meaningful core company measures vary make X:XX call SEC, other actual be non-GAAP projections comments by XX-K may ongoing Investor has XX, by similar discussed on earnings tables information now on from refer result, GAAP obligation This results most this today, Ravi documents GAAP statements us These will the X:XX being other Allegro's and available securities conference federal to presentation during clearly it update this on forward-looking more that accompanying in risk be financial based been could Please The over found page assumptions differently enable to financial as filed substitute uncertainties recent of used Ravi? XXXX. projections. to which and to May the Please to the forward-looking X:XX press results release including and and referenced current our earnings Vig. information of not and to during companies. A a press our can financial The Allegro's in replace today and call core results non-GAAP highlight operating to page. investors the intended laws.

morning, financial great QX X:XX wins our products, from and and especially of in automotive remains our design very Katie, everyone. Thank was good strong, story target and markets. accelerating strong you, performance. industrial Demand customers

alignment continue to benefit high-growth applications, win automotive tailwinds, to from We design and momentum. multiple expansion, content including

we growth xEV, support revenue Now data wins quarter was overcame XX%. and to last In total quarter year-over-year the our basis turning results. ADAS and target roughly areas than in up growth design QX, X:XX related are million. momentum wins model. better a nearly $XXX.X described QX and QX on XXX% industry fiscal XX% the these to they markets center with industry The design make of the emerging and X.X in up Our and rolling four wins COVID disruptions in up long-term revenue

and most saw few record up target. XX% of a high-end be X:XX after towards year to XX.X% is retiring margins that margin of QX transformation Derek to we for a Now, expect I to announcement in This in [Indiscernible]. industry. being weeks gross X:XX continue again make progress at new (ph) subsequent pleased guidance rate to ago track Today and expansion our Paul We back in I for non-GAAP particularly you Derek be introduce run revenue and with prior on Paul Broad High to D’Antilio, Officer. one long shaping to the Financial Chief our best. the exceeded IPO. our him opportunity in and his wish Operating our again, take I'm Tech. January, to strategic Allegro decision this Financial career thank with Sanlitun support fully and to joined to want this you a successful Walsh experience the partner decades of

I'll already accomplished color on board. more timeline. and call the continue share to details with business Paul glad expertise are And to hitting financial over business provide more the our We to you turn a with the have outlook. acumen Derek, laptop. Derek? CFO he Derek on He's and the and an Now he's I'll with strong X:XX on then will financials the

X:XX everyone. morning Thank good you Ravi and

expected partners pleased us of business increasingly impacted am sitting our disruptions X:XX same delivered to by increase supply for sequentially. dead in let seen Allegro me report sort related backlog financial markets assembly the the to down recover after climb, Malaysia. and continue at ago an the of say year the supply guidance. team all of I've and XX% X% first of per with I and few the company part and very million, very markets at is more within solid all and made encouraged be across I'm than revenue quickly high-growth my and chain would margin Allegro historic enabled excited and about regions Last financial diversified gross revenue backlog another company progress. share exceeded great for was company, one our quarter the business. quarter over us what COVID-XX results, levels. of Allegro I'm to Customer the that In quarter, First to From well-positioned earnings prospects that weeks strong quarter $XXX.X supply QX, remains has the anticipated, be

chain marketing a supporting remarkable done automotive. sales in job particularly Our customers, supply all operations our have teams and

result sequentially of revenue. QX, to our automotive $XXX.X grew of As efforts in XX% representing revenue our a million, their X%

in in Our industrial in businesses, XX% growth $XX.X million, XX% with our was in Industrial strong sequentially and XX% representing see quarter. the the our supply xEV automotive X:XX roughly represented to constrained. which continue of revenue revenue quarter. We revenue ADAS revenue declined of

demand quarter the to Once record levels. represented upon again customer diligently no continue Customer XX% been stabilize quarters. declining constraints supply based with of over technology quarter, and have additional million the quarter. to XX% Our in other revenue Other remains coming industrial XX% in decline in than working our X:XX single-end was $XX.X A sequentially. our capacity. of in secure and orders more was operation the revenue we teams expect outpace the customer very backlog anticipated revenue and represented supply will strong sequential at revenue that

well Our to we quarter our and plan. expect wafer TSMC to double ramp underway, is this TSMC receipts on track

enable We in with give us enhanced over flexibility. are of our partners continue additional a foundry capacity year we bring long-term and growth sources of capacity on process the to to also back to securing end

of margin X:XX model. good basis more investments was charges with million made on compared both last and adjustments was SG&A In continued remain We margin were quarters expense also our margin from $X.X fronts. X:XX consideration include to compensation controls to in $X.X $XX.X an was gross million revenue. cost stock-based about XX.X% by to excluding GAAP adjustment record. target offset and expense QX expense a million. point including in XXX gain factors track of million $XX progress other million million. from advantageous above and $XX.X million development. million. non-GAAP and GAAP $X.X to structural QX million We and R&D GAAP progress in basis multiple than of was the sequentially GAAP non-GAAP $XX.X XX.X%, higher of XX%. in of on in $X.X We operating expenses, are XX.X% the benefit $XX.X continued SG&A we've meet were a included target million, run was $X.X product continue Operating and stock-based Operating recent Non-GAAP XXX rate expenses in of improvements, margin points of other pleased one-year meaningful million Gross these make the X:XX were financial towards liability. After same compared X:XX non-GAAP the expenses million and R&D of $XX.X mix. $XX and quarter contingent gross Total million $X.X non-GAAP compensation expenses Non-GAAP expenses expense, compensation charges gross research with ago. variable points quarter for up QX to just

We up GAAP to expect modestly non be expenses in fourth quarter. the

was effective was GAAP X:XX net rate quarter $XX.X income expect XX.X% income of or be was count tax $XX.X and earnings per Third non-GAAP was and share in operating GAAP XX.X% quarter. an The quarter GAAP diluted share net for QX was revenue. $XX was tax XX% XX%. sales. with and non-GAAP $XXX.X of sales XX.X% shares The the that million million Non-GAAP of QX $XX.X the or operating effective income of million income or million, was million fourth rate to about we $X.XX. diluted XX.X%

non-GAAP about Our was $X.XX, exceeding our diluted by per X.X%. guidance share earnings

compared also million. million. million, million to sequential million. in the to million. XX ended about and range. of to the quarter, An Days marginally $XX.X our XXX our rose equivalents the QX we over increased $XX end Accounts balance days target Cash million $XXX.X of cash the at quarter XX to in inventory balances We $XXX inventory by continue of QX flow DSO were $XX.X below were of days. our cash sheet and Net in XXX XX:XX to within generated in $X.X a strengthen increase quarter. XX, about receivable target in with quarter QX $XX in We still operating increase

channel financial and toward In Ravi meaningful at turn quarter. call over historically backlog XX:XX Now high and very the addition, we on at additional our the remains In progress the outlook demand to historically fourth levels. very strong, back to make continue we'll in is business for the our remains inventory target levels, model. commentary for low summary,

end in year-over-year our QX strategic Thank lines across spreads you, and Derek. reflected markets. XX:XX Revenue product

end We continue our our multiple was these a fast growth content the which is designed but strategic to Fuelling of expansion, benefit and momentum alignment including part growing transformation. markets. of pipeline, markets, emerging tailwinds from audible key with R&D tailwinds

Our revenue have believe, yielding is line. bottom gains. this xMR that both are XX:XX investments are The share product a translate innovations market result in will a and on by impact we we motion into and the seeing top new control embedded and we that positive accelerating us competitive advantage giving

proof technical leadership. three quarter that are a last examples of offer Here from great points

and XX:XX [Indiscernible] at systems secured driver the particularly First, center transmission EVs. for enabled our [Indiscernible] share to assignments solutions XX XX:XX in generation market quarter. We gains. take in the motor back competitors, a * technology braking sensors Second, transmission socket share our new XX:XX speed continue design where XX, steering steering we at leader expanded including xEV, and in GMR efficiency the from biased the wins in next significant

expanded of and we Third, automotive with areas both in include family a high IC wipers, initial robotics with motor up sensors applications to speed low tiny designments XD and as position factory E-bikes, such for XD position grow up and it's QX, an was incredibly expand our broad-market industrial end-market million. revenue Moving chip versatile to year-over-year to automotive sales $XXX.X well-aligned in our and and up XX:XX channel XX% strategy business.

quarter. for powertrain been record of is we we XX% We on this compares content of the advantage favorably also On have And reductions we're in we have current the we xEV up top not believe basis. our growth with of momentum at to Malaysia this has it from quarter comp xEV were in content good trend. secular growth take in face position xEV vehicles. Looking supply CAGR market. XX:XX ours have quarter for result supporting we ahead and that that roughly period, more electrified stronger, We four grow opportunity XX% to over believe to a XXXX forecasted (ph) revenue growth, estimate the a would XX% chain than xEV our combustion even internal to XXXX. This growing XX% xEV challenges revenue, of production rolling a another win

and a quarter, gearing and a continue acceleration in We're see plus brake significant also resolution passenger braking Europe systems speed XX:XX one Last vehicles. and key sensors ADAS which quarter, automation we market TMR cross solution modularized of in context three end breaking. high also our using ADAS position enabler leading across a launched advanced adoption wire product Last XD level three in market win our our that first of platforms. secured system X increasing We vehicle Tier sensor, the level real with ready portfolio. level to plus plus an supplier is we design our is by

‘XX constraints. categories into believe growth In rating well we like falls a we infrastructure. to broad-based know, are uniquely beyond, was discussed the our support growth growth, for charging these as robotics, million a strong been Reasons XX:XX us and the growth market. to a we range design fastened growth our to green areas, in (ph) energy these driven also $XX.X and As end is adoption, data ADAS outs of revenue many plus top in center. are in on year-over-year. last layering return has favorable. center, industrial range industrial of and incredibly we we the noise as expect EV data anticipate the doubled quarter. to by positioned out year-over-year, saw revenue infrastructure offset revenue of a that but hyperscalers of versions $XXX both build as data economics to approximately audible stemming service continue $XXX new framed FYXX beyond double-digit systems. the strong existing are XG Demand market. Positioning grow in win Looking with up million. year-over-year QX the at saw the business FYXX XX% million with automotive playing and data agreements key XX:XX extends gains levels growth results with strong trends last and and we expected sustained to to center from Looking ending to exactly We ahead, growth supply quite year. the We an in business be across industrial and for is both preface and conversion healthy quarter. line strong you stacks one industrial with in just return QX, record XX% by level broad QX, solutions in by The secular and the with earlier not sequential long-term center of drivers In fiscal the strongest major ADAS safety with industrial to of XX:XX with was to a one efficiency We

expect we industrial both and down. QX, other off flat and be For to will sequentially automotive to be

is share of of gross XX per ahead. We anticipate acceleration believe $X.XX. in non-GAAP the strong with to XX%. earnings range expect will be We XX:XX range strategic to a differentiation. to in I non-GAAP the of $X.XX Looking be indicator competitive margin the markets senior

energy, over and the the a strong convergence the in We trends that, in innovation data X.X have growth. and call we're a pipeline story than expansion enabler, turn industry so and We expect of growth XX:XX fleet With to technology industry Allegro spot center. back green automotive, will be content and I'll of marketer key believe better is secular growth that Katie.

prepared Thanks, remarks. our XX:XX That concludes Ravi.

the we'll participants. the question-and-answer for our questions. Now please can with open review instructions Operators, call you

XX:XX Gary Yes. Wells Thank from Instructions] And you. first question Fargo. [Operator our comes Mobley of

open. Your line is

want asking that to about some Welcome earnings I spoke your chapter. fourth the in if between can your such may I'm supply your factors the back contribution customers you quarter. to supply of contestant those those kitting chain constraints and may break in that considerations internal out assembly? best constraints and, next to for impacting fiscal you out you everybody. perhaps start constrained supply of, what be Derek the outlook Good as of be specific morning, XX:XX specific own the to the Paul, the wish wondering call by supply

Yes. XX:XX

affected demand backhands – balance general growth fiscal a associated clarify projections. constraints supply – industry the including wafer to we our in our industry this we COVID supply related impacts were general with to that At all that wide point, Malaysia. with imbalance, supply, to have capacity we as that revenues with a specifically our continue in continue supply Just QX have

has continue So firm. receipts been we PSMC wafer gives great momentum our stated quarter ramp to wafer us that quarter, which capacity double, over the on

We target at demand capacity. to on also will XX:XX increase capacity on and and our have of alternate we in end So supply we the secured tailwinds near for and momentum to lens market, with a growth. clearly design suppliers, agreements further the future. the continue continue long-term a strong continue point, But our exceed back to sources due to this bring

Gotcha. Gotcha. XX:XX

year I think were XX%. roughly margin be on to your fiscal gross ‘XX counting you previously, exiting in

front so that? overall product your Your to would the options? point. by to rounding more you that that a or mix on – Would fiscal you your mix is Or And to so three gross expect be tailwinds? fab issue achievement ‘XX? year you get of you guidance be driven it different more in in simply expect by view margin But do there to ASP rounding it how to clicking end driven XX% production of context the double

you. the QX, here XX:XX really xEV ‘XX. a Hi, couple content and that two seen believe what piece those the basis right, a XX:XX higher gross points that of Derek, But ADAS. the is we products thank result And structural improvements. which sort macro trends. from over Gary. gross second are in drove about bit The margins you're that. fiscal the as has that said Allegro, towards I is structural you've had This the a longer-term One mix of benefit one-year feature a the lot is margin at of targeting and the XXX XX% shift margin is the travel we're over little Ravi more was really about, of really talked years last gross improvements company in great quarter seeing

really sort between said here, XX%. driving be gross and expect near-term, we So the we've that. margins macro as XX% to trends, of there's two in But

guys. queue. in it. Okay, appreciate you, XX:XX I'll back hop the Thank

you. Thank XX:XX

of Rakesh Vijay Mizuho. from comes question next Our

line is Your open.

and Derek. design talked quick question wins on look investors running the just you center, but Thanks. how to should through strong a as segments XXX% revenue do with are great xEV congratulations, from the conversion, etc. think about how the guys. pretty and you XX:XX I should design being wins? know Paul Yes. I ADAS think Congratulations that about design growth and a But translate especially, these up wins. you and revenue data quarter had pipeline Hi, how here, on

Yes. XX:XX

that Our to the one as to as us organizations. our by awarded claim when purchasing designed are projects that customers grant qualify awarded customers well we us and wins them, our

will they're the degree all provide. for that they they but our this practical to it and, convert data we show reasonable provide They, of to doesn't purposes, guidance So, company we they're have momentum of the revenue. that assurance revenue continue – – to replace a

XX:XX Got auto it. up the into March And I talked industrial about know you quarter. sequentially

So good side chain to see some that. in talked about and constraints supply you industrial. But the also

If alleviate? you How Thanks. That's that it do you what they can you are? seeing see guess are When alleviate? it.

you driving Yeah, start up market well if key center. industrial well our the is cap when call we were our again, that really broad we at win rate, as and wins want in data conversions, as XX:XX looking that as so the production sectors the are working by have to general, as that, design the xEV, the business tailwinds feel it ADAS that in

continue So Thanks. when I in continuously despite offer the generate capacity all into supply market. that we see an still think continue we will in exceed that near increases future. we we levels look this, the to The they And demand supply. at exceed that experienced, of to and the

Thanks lot, Ravi. Great. XX:XX a

you. Thank XX:XX

Quinn of Bolton comes question from next Needham. Our

is open. Your line

wanted start nice of bigger sort to the picture. on Congratulations Ravi, Derek. with and outlook a welcome results just XX:XX and

I think, past in conference calls.

and of talked have rate sort in guys about fiscal You maybe digit double a mid-teen load (ph), ‘XX. growing your by confidence

calendar into you look gains, give expectations – production and you baking are you sense, you in auto what production I've continued unit got do terms increases for or what a think, versus in of up. us gains, ‘XX your ’XX, in do follow can ‘XX sort calendar content versus fiscal of then you As what content a

an We cautious production. the today seen production terms sources demand is soft there car an challenges to a is numbers we continue has independent forecasted. the car of from early automotive, projections already to have have think that that availability. do at an the semiconductor from of we supply Yeah, there external we in due will point currently remain indicated data I impact, of XX:XX this that market exist that data But and in that impact year-to-date being see are car production

low-to-mid the in car a So factors – our terms some guidance provided guidance of cautiousness really mid-teens teens production. have in definitely industry is

We at will on year as goes to play. to the our continue supply review continues and estimates. into come relook this as we'll We'll,

is vehicle the think forecast skewed for production So take sent revenue a to comes – that business. with gains more content it's safe [Indiscernible] it – to in, XX:XX it's you to assume probably is could be tailwind it

expected the over business XX:XX that business is XX% and look (ph) business that and And X% a market that also continue we in this really that at, last we industrial XX great course our is our that XX% also forget of to I SAAR provided months. plus do direction is number, our of the mean, has to the something we not range we business other overall our tailwind. to

there we that we this optimism. for is expect being will off entire in do at this point, terms the reason think cautious industry growth of better little a have So, where be. I But is

little about business. on just some my of side the spend wondering the follow question talking if of bit a XX:XX you could the time GMR up you're of seeing Great. was traction

it a, some interest you sensors? in in into say Is and sense? I think to back which electric vehicles. is you know the seeing GMR speed can speed sensors transmissions. where mostly broadly, current in you or Are technology a the application But technology? are big Thanks. I beginning you The mentioned for big that greatest bias requirement seeing market move

Yes. XX:XX

applicable four TMR and different GMR spaces. in see we So,

the the that in we service said the magnet announced, XX:XX are TMR, we to safer breaking provide products type wheel share is wisdom see area sensors ring two fourth one the just that high in we of have they a which off provide market be is and but over XX We the can would then So, in applicable third higher, top with back internal silicon we had means the wins of solution very the is more pipeline current currently The and the that we to the have that sample are more then area. and see And that with in the we safer course which out motor those is importantly, – we will quarter. coding, cement that redundancy, them see, specifically sensor solutions more continue about motoring and purposes transmission in being sensor for attack higher positive what TMR the recall by in transmission TMR integrated continuously we I that are, applications and enable where speed are of area. ADAS is let think have that in space. area me combustion These central to to market. first density ADAS manufacturers speed of our the better that one xEV products xEV terms opportunity heterogeneous sensors encoding, is to

extraordinarily So, ecosystem. to we we aspects we're broad-breadth of in of and GMR an applications attack say will the TMR automotive proud and target all have that

you, Thank Ravi. XX:XX

we [Indiscernible] of Thank Barclays. have you. XX:XX next And

Your open. line is

see gross address question. sphere. start look pricing But through talked ask you're good pricing, any Hey, on seeing seeing the pricing now you Thanks start you're my you to just turning from wanted XX%. your whether towards about next morning. to at I a taking tailwind maybe are lot of to layer XX:XX you and you as for Ravi, people margin to

we Yeah, on would certainly XX:XX has through, think I we pricing being approach strategic you'll on pass is been find neutral relationships long-term customers have that margin what and with ASP. that our

Allegro to that So but of make the with can sure perspective. margins objective operate successfully, pricing attacking order optimal in not on

is long-term long-term So, really as a we're from that one, it's perspective, great is one think, we is, business, our relationships industrial and customer. partners we a for well on that as focused long-term really automotive

really continually margin pricing. what the at we new focus though, trying neutral are for is So That's this good always. be this opportunities up But bring point. with on we worry opportunity margin. point to about mix new businesses at we It that

been quarter. you Thanks, kind is was xEV and XX:XX this, auto have it last percent think but missed and out the breaking revenue, had I I of XX% might ADAS

curious Just you mentioned if missed and that it. number, I

XX%. It's XX:XX

number. slight So a a uptick, every we'll continue particular in slight you uptick in quarter that see to see

XX:XX Ravi. Thanks, Okay.

Thank you. XX:XX

SMBC Our next Pajjuri of from comes Nikko. Srinivas question

Your open. is line

morning, Paul, Thank congratulations And Derek XX:XX you. good both and of and you. Ravi to

my I days, First, question mix if wondering then polar? TSM know any on see you and sourcing. have versus just sourcing early you your And target how and UMC TSM I for, longer-term it's question that margins broader bit curious about the on but side, might, the your how guess impact how impact, mix just gross is, might mix you talked going a forward. to pricing little as that

Yes. XX:XX

US over that's sources is the as and understood of Asian sources so TSM is we pretty have ratio continue sources. well everybody sources so months not the last that we set Asian Our our than XX something US certainly increase more to competitive to our our that than ramps, pricing – to

really by stability and They're the and the well just see quality – great but sources. leverage play bring not production. So, we would from really they've the these requirements fulfill capable a requirements, us. of in it automotive very for cost, in that supply It's expect really chain a is continued terms manufacturing, sources to partners, benefit they technology

objectives to either we ones. we with are So continue growth continue to goal long-term on to enormous our there bring – and and continue we – right, benefits these other these sources, at is our look or new – to the sources, ramp our support to us sources current

question But bad at the not on as production then you a of quite the tight are hearing and ago Ravi, the inventory, still is about in Got in things in compare XX:XX the we're that terms least, factories a around flow if auto a now, news on channel it, versus given the year obviously, side. the world.

tightness? can What mean, I their industry supply unprecedented there do I they're want that industry you to coming looking going question, or of again forward? I of customers, at? are you the will you going think practices longer-term in but inventory if just out to do manage about, time customers your is terms So this back comment on you situation, telling then at the you're of going to come they're how any is guess, a supply other thoughts out and what inventories just like? what this we think channel as in your look your practice in seeing hear

every and record that they're distribution channel OEMs low, still that and at we them our every participate sitting rather, levels, in know do direct so taking So can extraordinarily we in, to to – all part that inventory we material most at keeping XX:XX can of are [Indiscernible]. we lows, lines our inventories, give phenomenally we and low as the for regarding conversations customers we continue us when the are device look peers know

So how particular are the areas, deal lot lot an get do would opposed industrial, these, we us as convenient rapidly crisis. of are are key have that while an are growing but and well happening, such These areas complex high front as when as that in really growth ADAS, etc. areas propose going it's point this fans, digital XX:XX at have how around, to all all see even indications [Indiscernible] conclusion supply density there's the are millimetres is which ice, is vehicle, around with point, by areas stable. need no been all growing the we lighting, in industrial, is more, supply to millimeter these solutions, going there of extraordinarily the semiconductors at on the of fuelled conversations etc. as a the by which all XXX tight conversations how I into for these don't we supply the So But of at XXX this. additional discussions for quite situations, The as as well this a SmartPower to are address on they conversations look initial been OEMs customers, chain the supply, also xEV,

XX:XX Got it. Thanks, Ravi.

have we line Wendler if And (ph) you. Thank Jefferies, open. your Natalia is XX:XX of

proportion the the some question, on much on ADAS. Thank XX:XX automotive. quick and providing Hi, Ravi. of Ravi Derek. Hi, you kind of the for A color so growth

ADAS, mentioned increase kind a through you guys to on was, think had level content level once you similar kind of one. you content of see see you I cars transition curious, question higher I just guys from As level the if you that I'm the zero go the any do of is levels, transitioning the there and of kind were, further level? one from increase uptick? and meaningful

Natalia. XX:XX Hi, Yeah.

question. great yes, So

in go level to from that So, you you electronic economy you a and level more get and to terms steering to system, tends of to the two, content provide perspective. as higher, plus, one the level functionality safety the the go to one

is in and these motion have in be industry. vehicle to at So reimagined point, that independent systems past, a breaking, of control steering being the the entire more about we've spoken this the

electrification skateboard As wheel, additional the the systems, The you and which drive it's onto train will by electrification. wire, you long-term really wire, platforms steer more into movement all the of motion intersect, ADAS body on we the and know, skateboard wheel, requires really more content. control on of clear have wheel, is, from per results systems onto the control steering control drive actually onto the get and on motion independent onto wheel, break in so what which by which break trends these your of

motion – relates we're the tailwinds we secular good the about feel in So as very it control vehicle. to

you. ’XX, you the this like data [Indiscernible], future to feel lot wanted just And just year? follow helpful main for put you fiscal guys check, color. up, Thank very I fiscal in for double of focus growth in of That's and would curious a be the my of on center kind source XX:XX industrial if

announce AD wrap industrial our business, XX:XX to – data continue had I a center stat data that year long-term on our did last several Well, – we center, think we great agreements, -over-year, signed had okay… we quarter quarter-over-quarter

XX:XX To get than more doubled.

XX:XX More doubled. than

cooling, driving addition that, we see we in in associated our and control business. industrial this really electrification our for ramping, So, area seeing we taking were this of continuing solar equal new winds projects electrification, start industrial grow projects segment up center grow and these and these we'll the business, do particular our to the with as also design were us ramping, But have broad-market hold. as start broad-market motion data also, talking to about that's started infrastructure

for as excited core about our automotive in are motion both we So industrial. well strategy, which control, in is pretty setting as

XX:XX Thank you. That's very helpful.

Pitzer Suisse. have XX:XX a Credit from [Operator question Thank of Instructions] And John you. we

Your line open. is

and on I'm products. gave that. for second could is costs morning, XX:XX Yeah. only of to sort new just of question. letting pricing basically you an half Thanks driver me and Ravi, answer I'm elaborate the back Good Ravi, along When you saying if pricing and wondering for the you think raising Derek. pass to been about mix, go you the the have products outside mix real ask gonna to very earlier we that funnel? looking about new pricing when that target design beating revised we How that about like about GMR, the target and street margins faster, the that about expectations? higher? is needs think in start you on think think path should be or you Should about the to when pricing given say we your should gross strong you're pipeline to think

right? great other, not try our ourselves XX:XX point margin that costs to this in so, in. right John, pricing Yeah, question, are we're the at where of to strategy so, the terms keep really is coming neutral you're

around descending throughout cost a as inflation and the is chain. that's certainly So there supply increase going

as is result to offer growth segments. So attacking but the emerging these uplift a and our typically on will hand, long-term these margin are so continue some see growing. we story higher segments segments opportunities other These about of new us

like at in probably we overachieve closer sources additional little the be your in to backhand help we'll we mix. and to for a see continued other of a are XX% the marketing where next be in bit hand, at looking the get will running on gross us facility to that that clearly so that we but efficiency margin. would we activities, step We add our are, Asian be to step once at supply ahead. question, a to also as stably push have that I XX:XX On wafers, we'll continue continue to certainly with we So XX and our target we'll – guess Philippines, forward bit bring more ahead the journey, we both also which

completing supply if Or Ravi two you between want there's address deficiencies whether rethink be of you limited you kind internally XX:XX And to have are direct you you your is current the it'd away can you then kits? And supply? as XXX% not that indirect there's Is of externally? or much of constraints my the being that makes or and there's you? today? sense strategy and curious to and can deal sort the do the customers control kind to as environment wondering from on, around then with directly I'm how demand your follow not your get full differentiate question, supply you Because versus change by of what CapEx

XX:XX Tough question there.

what out So look we at demand that's what the there. –

Our of in by, outgrowing really rest business demand we certainly that the of that some as general. we are FCBA new have our is areas products in the fuelled the our well see business examples industrial our by as are, we businesses, that the ADAS that

there. inventory growth new is builds we on challenged been the fuel and see that see supply So broad have which really that a certainly the organic millimeter, could that are inventory focused near we projects a it will But wins. growth just is are XXX car next live that going really customers, or of our we is – be constraint production narrative it growth, and validates is we on, XX:XX about not where don't over we don't be is be kind that future. the continue new challenges has always We to that to

challenged, end challenges, see the wins continued and target design really the demand just we of are markets do up our ramp specifically that focused we'll millimeter, other being pressured specifically, by we we So be as supply growth XXX on. on the

XX:XX Thanks, guys.

XX:XX Thank closing in it turn the seeing questions speakers for to I'll back no And the over queue. I'm you. further remarks.

you, XX:XX today. there call no you conclude further this Okay, Thank joining for If morning. Chris. questions, are the thank all will us we

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

now disconnect may pleasant a day. and have You