Good morning, and again, welcome to J.P. Morgan's 14th Annual U.S. All-Stars Conference here in London. My name is Harlan Sur, I'm the Semiconductor and Semiconductor Capital Equipment Analyst for the firm. Very pleased to have Vincent Roche, Chairman, Chief Executive Officer of Analog Devices, here with us this morning. For those of you that don't know the Analog Devices team, leader in high performance, mixed signal, RF analog semiconductor chips, strong position in power management, very strong position in signal chain processing, right? Both analog and digital, which is the technology that bridges the real world to the physical world, best-in-class gross operating free cash flow margins, strong capital return program, very diversified business, right? Industrial, automotive, comms infrastructure, 90% of total revenue. So Vince, thank you for joining us today. Thank you, Harlan. Great to be here. Same time, same place, different year. Exactly. So to that point, right, a year ago at this very conference, the team was driving 25% year-over-year growth in the business, positive book-to-bill trends. But you did call out, you know, order deceleration, some pickup in cancellations, which in hindsight, did signal sort of the start of the negative cyclical inflection for the ADI team, but for the industry, as a whole. So kind of take us through the dynamics over the past year, and more importantly, your view on the cyclical dynamics in your business sort of going forward. Yeah, thank you. So, yeah, we had our earnings call, third quarter earnings call just a few weeks ago. Actually, in the third quarter of 2022, our fiscal 2022, we did call what we thought was the peak. Mm-hmm A t that point in time. And, you know, we got through the pandemic, we had a supply chain crash, in, in, FY 2020. FY 2021, basically, what happened across the industry was we tried to squeeze 15 or 16 months' worth of shipments into 12 months. Yes. So we were in catch-up mode, and, you know, the shortage itself drove some panic and, you know, we've been. So we were chasing supply for 2.5 years. I think for the next year or so, we'll be chasing demand. I mean, I think, as we called out on the earnings call, we have a belief that what we have right now is an inventory overhang that will take, at least in ADI, will take us somewhere in the region of six months to correct. Mm-hmm. But we are seeing some stabilization. We suffered a lot of cancellations for the last six or nine months. We've begun to see that moderate somewhat. So what we're getting now is our backlog into a shape that we would consider, in pre-pandemic terms, to be more normal. So that's where we are. I think 2024 will be a year of flushing inventories across the industry, and I believe we'll get back into a more normalized growth pattern in FY 2025. Perfect. Looking at ours and consensus revenue profile, we are modeling, as you mentioned, right, continued softness in the business for the next two quarters. Peak to trough revenue decline of around 18%, about the same magnitude of the decline as the last cyclical downturn, 2018, 2019. Yet, the team is driving, you know, low 40% operating margins to the trough, right, of this cyclical downturn, versus the prior two cyclical up trough, OP margin levels of 37% and 28%. So help us understand the strategic, the structural changes that are driving the continued improvements in through-cycle profitability and earnings power. Yeah, well, look, we have a tremendously diversified portfolio, as you pointed out in your opening remarks. We cover all the critical market sectors in advanced communications, immersive consumer, industrial has many, many different parts to it, including digital healthcare, factory automation, Industry 4.0, advanced instrumentation for scientific research, automatic test equipment, and so on and so forth. 5G systems, now we're starting to get into the early stages of building 6G systems. So we're present in all the critical applications that drive modern socioeconomic life. And we happen to have more than 100,000 customers in our portfolio. We've got 75,000 product SKUs with life cycles, for example, in the industrial area. Mm-hmm T hat are 17 years plus. So the stickiness of the franchise is really, really, really strong. So for us, getting our product, getting our new products designed into a customer, that's where we face the, you know, the price elasticity, if you like. But once we get our products designed, then pricing is very, very stable, and the substitution costs in our business are very, very high. So, you know, the business model is set up in such a way that we're able to capture the innovation upsides, then we have, once we get our products established, the stickiness, the stability is very, very strong. We've also been able to steadily increase our average selling prices, so that helps, obviously, top line, top line growth, and I think as well, our additional scale on the manufacturing side, has helped us to get our cost structures into- Mm-hmm ... a place that they haven't been. All that said, what we're seeing now are higher highs and higher lows as well. You know, if I look back, if we look back at the team over the past 20 years, you've grown your revenues at about a 9% CAGR, 30% faster than the overall semiconductor industry. You've grown your earnings and your free cash flow at about 11%-13% CAGR over that period of time. Some of the growth has been organic, but most of it- well, some of it has been inorganic, but majority has been organic, right? On a go-forward basis, at the last Analyst Day, you put out a target revenue growth rate of 7%-10% per year, earnings about 10%-12%, and $15 per share of earnings power in fiscal 2027. Peak of this current cycle, right, the most recent earnings cycle, you're already driving $11 of annualized earnings power. What's the confidence level in the team attaining your forward earnings power target of $15 in 2027? Yeah, so what gives us great optimism, you know, we're very much an innovation-driven company, and, you know, we're spending $1.7 billion plus in R&D every year. That's always the first call on the company's capital. So our product portfolio is stronger than ever. We're investing more to get ahead of customers' needs in all these critical application areas that I mentioned. You know, we have also so many concurrent secular tailwinds to push us ahead. It's unprecedented, the number of secular tailwinds across the industrial, advanced communications, immersive consumer, automotive as well, of course. Mm-hmm. These tailwinds, we've never had such a richness of concurrent secular tailwinds in our history. And I've been in the business over 40 years now, and typically, each cycle in each decade was driven by, you know, one particular technology modality. You know, the early 2000s, it was internet. 2010 plus, it was smartphone and cloud. You know, now we're seeing the electrification of the automobile. We're seeing more and more technology used in automobiles. In fact, cars and transportation systems are using 10% more silicon every year, with more and more software. So all these things are conspiring, the digitalization of society, digitalization of the economy. So we're very well positioned, as I said, from a customer perspective, from a market dynamic perspective, with a better portfolio than ever. And, you know, through some acquisitions we've done as well, we've built a very strong power management portfolio, but we're still underrepresented there. Mm-hmm. We see that as an enormous opportunity for ADI to continue to gather share, to do more attachment between our mixed-signal portfolio and our power portfolio. So we put all those things together. We feel confident that, you know, 7%-10% when we get back beyond this current inventory indigestion cycle. Right T hat we'll get back into a more normalized pattern. And I suppose, you know, the big question is the rate of recovery of the China economy. So, you know, that will have some effect on the upper end of that growth expectation. A big part of the above-industry revenue growth profile has been, obviously, it's powered by your design win pipeline, right? Last year, fiscal 2022, you grew your design win pipeline by over 10%. How is 2023 tracking so far relative to that number, and what areas of your portfolio, or end market exposure is the team really seeing sort of the strongest expansion in sort of the forward dollar pipeline? Well, we continue to grow the size of that opportunity pipeline. Some of it we get from, as I said, the market trends, where I mentioned earlier in the conversation here that we're getting more ASP per product now than we've ever. You know, every year, we increase the ASPs of our products, and that's driven by the innovation strength of the products we're developing. We're building more complete solutions for our customers. We're adding software to hardware. So all these things increase the content value of ADI's products for a customer. You know, I talked about the need to be able to connect our power management portfolio more directly with the strength of our mixed-signal- Right W here we've tremendous share. So, you know, as I said, the opportunity pipeline, this year again in 2023, it will grow about another 10%-12%. So all that gives us tremendous confidence in the potential growth of the company in the years ahead. [Paying], we focus our business development efforts on making sure that pipeline is not only growing in absolute terms, but that the conversion rates are also increasing. You know, you talked about continuing to build out the power management portfolio. You've done a phenomenal job on the organic growth side. Part of that power management portfolio unlock revolves around unlocking synergies with some of the acquisitions that you've done, right? Hittite, Linear Tech. Now, you're in the midst of unlocking about $1 billion per year of revenue synergies by fiscal 2027 via the Maxim acquisition, right? Right. That you completed in 2021. We can already see some of this unfolding, right, with Maxim GMSL attached to your A2B connectivity solutions. Right. We also see it within your battery management portfolio, also with your focus on factory automation. Where are you in that journey to $1 billion with the Maxim team, and your confidence level on getting there by fiscal 2027? Yeah, well, the pipeline, the opportunity pipeline that we have would suggest that we're well on track. You know, I think, you've pointed out the, the critical components of that journey in terms of the, the revenue synergies with Maxim. My sense is we'll probably get to the target we had a little earlier than we had expected. Of course, what happens in the economy will have some effect on that. Yeah. U.S. and European Chips Act bills were both passed last year. Key focus, right, is to motivate more manufacturing in the U.S. and E.U. to drive more focus on manufacturing leadership, as well as for business continuity planning in terms of supply chain diversification, geopolitical risk mitigation. You have fabs both in U.S. and Europe. What's the status of grant disbursements, timing of incentive tax credits, and more importantly, has the team seen an acceleration in customer engagements that are looking to source more of their semiconductor value, right, from the analog team going forward? Yeah, it's a, it's a very straightforward question with a very complex answer, but I'll do my best to answer it for you. So right now we make about 50%. We fabricate about 50% of our silicon inside ADI, and we've three fabs in the U.S. We've one here in Europe and Ireland. And then we procure another 50% of our silicon outside with partners like TSMC, for instance. Mm-hmm. That hybrid model, that hybrid manufacturing model, has been a mainstay within the company now for many, many years. You know, where in times of very, very strong demand, we are able to use flexible supply from- Yeah ... partners, for example. We're able to get more capacity from partners. When the market's in a lull, like it is now, we can bring more of our manufacturing needs inside, which helps us, manage utilization, protect our gross margins. So over the last—Of course, one of the big questions in our customers' minds over the last, three years has not just been kind of the tactics of supply. It's been around: How do we ensure resiliency in our manufacturing operation, and to be able to create some surety of supply beyond Taiwan? Yeah. So we've been on an investment track. We've massively, in our terms, increased CapEx. We've typically run our CapEx model at between 4% and 6% of revenue. You know, in FY 2022, that will have been about 12%. That's the peak of our investment cycle. For capital equipment for manufacturing, in FY 2024, we'll invest about $1 billion. So to cut a long story short, when an advanced digital node is considered for CapEx, you're looking at $15 billion. You're building 300 mm wafers, you need about $15 billion of spend. The most popular node inside ADI today. So advanced digital is 3 nm today. The most popular node inside ADI today, in terms of new product development, is 180 nm. Mm. That was digital leading edge 28, 30 years ago. So the equipment we buy, you know, obviously, there's been a tremendous amount of amortization. We're using 200 mm wafers. Yeah. So we've been able to just about double the output of our internal factories for $1.5 billion, $1.6 billion. So we're well down the track. We're actually, we've licensed technologies from our critical partner. And by the end of 2024, early 2025, we'll be producing volume of these products in our factories in Ireland and the U.S. So the more advanced nodes, we use 55, 40 nm, 28 nm, and so on and so forth. We use partners for- Mm-hmm. They're obviously on 300 mm wafers. We use partners. So to cut a long story short, you know, we've obviously capitalized. We will have completely capitalized these equipment needs by the end of 2024. We have been public with our announcement of EU funding for our operation in Ireland. We've gotten pretty significant funds from the EU for both manufacturing grants, but also for R&D grants. You know, that's been confirmed. We have applied for CHIPS Act funding in the U.S. as well- Mm-hmm ... for both manufacturing as well as R&D grants. We expect to hear where we stand with that by the end of the year, but we're optimistic about our prospects there. As a part of that, you know, we've seen whether it's the past three years, where the entire semiconductor value chain, the entire tech value chain, went through a period of very, very tight supply, you know, in the semiconductor value chain, or obviously growing concerns around geopolitical risks and so on. We've seen a lot of your end customers, the auto OEMs, the industrial OEMs, the compute OEMs, the consumer OEMs, talking about not so much a near term, but a long term, like five- to 10-year plan, to try to source more of their semiconductors with U.S. and European companies that have manufacturing in the U.S. and Europe. I mean, has that been a little bit of a tailwind? Has that driven more customer engagements for the ADI team? You know, we're really not doing anything new in the sense that we've already got a large footprint in America. We've, we've got a large footprint in Europe. So I wouldn't say it is necessarily a tailwind. I think what's important to remember, you know, all of the, the massive capitalization activities that are underway now, you know, all that capital needs payback at some point in time. Mm-hmm. So I think on the more advanced nodes, all of the focus of the European and U.S. governments over the last three to five years, most of the attention's been paid to the really advanced nodes, 5, 3, 2 nm. And you know, there could be an overinvestment there. But look, at the end of the day, we all want resiliency. Yeah. B ut there's also, we've got to remember the economics of the business. We've built a supply chain that has been very Asia-centric for many, many years. There's been tremendous benefit to that: cost structures, you know, the efficiencies. It's gonna take us time ever to match, particularly in these more advanced nodes, it'll take us time to ever be able to match the cost efficiencies of the Asian supply chain. Gonna take time. Let's switch focus to kind of the near to midterm, and we will get back to discussing some of your end market focus in a little bit. But near to midterm, obviously, there's been a lot of focus on in the U.S. on the United Auto Workers strike this weekend, ongoing negotiations with the Big Three auto OEMs. I know it's early, but has this had a noticeable impact on your auto business? What are you hearing from your Tier 1 and your auto OEM customers? Well, there's a couple of comments I'd like to make on that. Number one, the effect on our business so far has been very de minimis. We don't expect a lot of disruption. But also once there's a customer for, you know, for an automobile, there are plenty of choices. Mm-hmm. So the good news for ADI is our business is very global in nature. We have very strong content across all the OEMs- Yeah A ctually. Be it, you know, in-cabin or electrification, we actually don't, we don't supply the internal combustion engine really at all, with the exception of idle start/stop, control systems. So, we're not so concerned in the sense that we've got a very, very good spread across the, across the globe with OEMs and Tier 1s. And, you know, our calculus suggests that we shouldn't see... There will be probably some disruption, but we don't see it being a material part of our business. Perfect. And you did mention at the beginning, of your commentary, it looks like cancellations are starting to sort of normalize- Moderate, yeah Or stabilize, moderate. Yeah. So I would assume that means that your backlog is also starting to moderate a bit as well. Is that true? I think that's fair. Okay. That's a fair comment. Yeah. Another good indicator of sort of near-term current demand trends is your turns business, right? Orders that get placed and shipped in the same quarter, right? I believe part of the weakness in the July quarter was lower-than-expected turns business. The team took a more conservative approach on turns expectations in this quarter's guidance. I mean, quarter to date, has the turns business been in line with the team's expectations? Well, let me say, let me make a few comments. You know, we run our company, we run our manufacturing operation on sell-through, so it's never in our interest to build product that customers don't need. Yeah O r stuff the channel, whatever you want to call it. So we've been watching very carefully the rate of sales, you know, output, supply of our customers to their customers. We obviously manage our inventory; we're looking at our inventory build or decline relative to what our customers are shipping. So we think we have really undershipped- Mm-hmm T he customers' demand, if you like, over the last two quarters. So my sense is, we've built a lot of inventory, you know, we've kept a lot of inventory on our balance sheet, but our customers are depleting ADI inventory. We're pretty confident about that based on how we, you know, we manage the company. So that's what gives us confidence- Yeah T hat in the, oh, probably second quarter of FY, fiscal, 2024, that we'll begin to see the inventory digestion problem behind us at the customer level, and that we'll be able to move back to a more normalized, demand and supply pattern. You did mention that, you talked about chip pricing, right? And your overall chip pricing or ASPs are more than four times higher than what we track, right, in the industry, SIA data. And your blended average pricing trend, as you mentioned, have been moving higher over time, right? And so I wouldn't think that cyclical dynamics, like the current downturn, impacts pricing for the team all that much because your products are really the key performance differentiators in all of your customers' applications, right? But, but can you just comment on pricing trends on existing and, more importantly, new customer and opportunity engagements? Yeah A s the team has moved through this sort of weaker period of time? Yeah. Well, that's exactly the right way to think about it. You know, once we get a product established, the substitution cost, in other words, you know, we've gotten over the design phase, the product goes into the customer's manufacturing system, the ASPs are rock solid. And, you know, as I said, in the industrial sector, we have average lifetimes of over 17 years. Mm-hmm. In automotive, it's somewhere in the region of 7-10 years. And consumer tends to be more, a more rapid cycle of innovation, so we tend to see three, four, five years of product life in a consumer product. But the substitution costs are very, very high in our business. We're never the long pole in the customer's tent when it comes to bill of materials cost, on an individual product basis. So, you know, our customers have always been more concerned about being able to get, particularly in the industrial space, supply of a product with very high quality for decades at a time. And that is one of the reasons that we control our manufacturing internally, particularly in those less advanced nodes, that are really important to our industrial customers. You know, these are high-performance products, but on very, very well-amortized silicon nodes. So, you know, once we, once we get the product established, the economics of the business are very, very stable. Where we have to fight like, you know, like blazes, is at the pre-design phase, because we're not the only show in town. We are the highest performance supplier- Mm. in the world of analog and mixed signal and power. But that's where the pricing dynamics are most intense. It's at the pre-design-in phase. And so as you've looked at either a very similar socket with the same customer, and obviously you have engagements with customers over multiple, multiple years, right? Is the team's focus to try to drive higher ASP per socket or, or, and/or sort of higher dollar content overall- Yeah. per customer engagement? Well, it's- Or it's a combination of both? It's really both. I mean, every new product that we bring to market, you know, has some level of increased power efficiency, but, you know, more performance per unit area of silicon, probably more software with it as well, and the software is giving us a chance to make the products more sticky, get more ASP value as well. So our focus tends to be in the critical big applications in industrial and automotive, for example. It's to develop anchor products that are very application specific, and then we pull the catalog or you know, the kind of more generic products around that. So that's how we approach that business. So it's about increasing value per application- Mm-hmm. As well as bringing more innovation value per new product generated to our customers. And, you know, I will tell you as well that, I mean, over the many, many years I've been in the business, the dependence of our customers on external analog skill is becoming more and more intense. The analog craft now tends to be really in the hands of, you know, a very few big semiconductor suppliers. So our customers are more reliant on us to solve that problem for them between the physical and the digital world. And, you know, scarcity drives value. Yeah. That's one of the reasons that we've, you know, we've got so much optimism about our business. Customers want more. There's a need for more and more performance, more innovation. You know, we've got an R&D footprint and a portfolio footprint now, bigger than we've ever had, so we're really optimistic about things. Perfect. Before I dive into some of the product segments, wanted to see if we can open it up to the audience to see if there are any questions. Just raise your hand and we can get a mic over to you. Got one in the back there. Sorry, thanks. Just please excuse the ignorant question, but you mentioned that CapEx would end up being $1 billion, and it would come from the peak of 12% normalized. But then you said that the majority of your sourcing and get more of the sort of higher lower-end node would be still from Asia, by and large. So you're not expecting to continue to need to build sovereign CapEx to secure customer demand going forward? It just seems a bit of an oxymoron to me. Okay, thank you. Thank you. Yes, within ADI, you know, we more than 70% of our revenue is produced on process nodes that are 180 nm and above. We will have the capacity internally to more than double the output that we have been doing over the last several years. When it comes to 90 nm, 55 and below, we intend to use external sources for that. So, if we wish, by the end of the decade and beyond, we, if we choose, we could be self-sufficient on 180 nm and above, but we will be partnering, you know, with key providers of process nodes below that. Building CapEx elsewhere? Yes, that's right. Yeah, I mean, you know, I said during the, the commentary here that, One of the big concerns is that all the attention around CHIPS Act and, and resiliency has really been a kind of 7, 5, 3 nm, 2 nm at some point in time, and not enough attention has been paid to the, to the older nodes. But, we've been able to obviously invest in our own, in our own needs, but also, convince some of our partners to put more capacity into play. Okay? Any other questions? Maybe to follow up on that, Vince, you know, you've been taking down your utilizations, wafer starts at your external partners, been taking down your internal utilizations. And your hybrid manufacturing model, as you mentioned, has allowed the team to maintain higher internal utilizations versus, let's say, what your peers call sort of hybrid manufacturing models, right? So there is a big difference, I think, between your model and your peers' model. So take us through the difference between ADI's manufacturing model, because it is allowing the team to sustain higher utilizations, but it is also the engine that is helping the team to maintain greater than 70% gross margins, right? Sort of trailing twelve months, even here through the weakest part of the cycle. Yeah. So, you know, obviously, in the nodes that are the minority nodes in the company that are more advanced, like 90, 55, and so on and so forth, we are dependent on our external suppliers for that. What we're doing with 180 nm and above, when the demand drops- Right W e bring more and more of that manufacturing back into ADI, so we keep the utilization levels- Mm-hmm. -as high as we can. And, you know, that helps us sustain the. As I said, even in a down cycle, the pressure on pricing for ADI is, you know, it's normal. We don't see a degradation in our prices whatsoever. So we have stability on ASP, so it's about how we manage the unit volume. And, you know, we're able. As I said, we have the flexibility to bring more and more of our manufacturing home, if you like, until, you know, we run out of capacity when there's an upswing again, and then we have the benefit of being able to use external sources. I think, but I think one of the other differentiators with your hybrid strategy is you are able to replicate both your internal proprietary processes- Yeah. at your foundry customers as well, right? I mean, isn't that another- That's correct. big differentiator on the hybrid strategy Yes. I think, relative to your peers? Yeah, the recipes are replicatable- Mm-hmm. in two places Yeah ... both inside as well as outside. Yeah. So the recipes, very often, more often than not, we license our suppliers' recipes and bring them inside ADI so that we get direct replication and substitutability. Perfect. Turning over to your product segment, so industrial, you know, your business, industrial business composed of a very diversified set of businesses across many different end markets: factory automation, healthcare, instrumentation and test, energy infrastructure, aerospace and defense, right? Help us understand how we should think about the different subsegments as the team moves through this current period of weakness, but more importantly, you know, what subsegments are likely to continue to remain resilient going forward? Yeah, well, there's two, two ways I'd like to talk about that. Number one, you know, we play a long game as a company. All of these sectors that we're looking at, like, the grid transition, energy grid transition, you know, the gigafactory- Mm-hmm. You know, electrification of the vehicle, these are all trends that we've been putting more and more R&D into over the last three to five years. And so we view them very much as a critical part of ADI's growth story. Digital healthcare. We've got to digitalize the healthcare system. We've got to make healthcare... It's got to be more prescient. We've got to put technology into place to enable us to, you know, to be able to recognize and diagnose diseases before they become chronic. And that business, by the way, has been growing at double digits for the past seven or eight years, that whole digital healthcare. It's It's about $1 billion now for ADI in revenue. We've very, very strong expectations in that area as well over the while. You know, when we talk about resiliency in the shorter term- Mm-hmm Y ou just look at demand. My sense is that we'll see some pause in factory automation, though there is a burning need to be able to bring manufacturing closer to points of consumption. I mentioned gigafactory. That's an area where we're seeing more sensing, you know, more precise actuation, and there's a whole range of technologies that we bring to solving that problem. But I think we've seen a pause as well in instrumentation, particularly the ATE part of instrumentation. Mm-hmm. But the scientific discovery, bench instruments for, you know, supporting the IT industry, we're seeing that business remain quite strong. And so if I think through the next year, when we think about demand, the parts of industrial that I think will be strongest will be gigafactories, digital healthcare. Aerospace and defense, needless to say, has been very, very strong. I expect that to remain strong. In fact, we are more supply-limited than demand-limited in the aerospace and defense area right now. You know, as long as in the automobile sector, as long as SAAR, you know, the movement of cars, of lots remains at a, you know, at the current rate even, what we would expect is that that business is capable of growing, you know, low double digits over the next- Uh-huh. The next 12-18 months, because there's more and more content being used in cars. So I think the content story is what is driving the semiconductor industry in the automobile sector. An area that will probably, you know, be in somewhat of a doldrums, I think, for the next, maybe the period of 24, is wireless communications, the base station infrastructure market there, simply because, you know, that's a very highly leveraged business. Interest rates are high, so carriers are gonna be protecting free cash flow. You know, they're trying to make sure that the ROICs are respectable. So I expect to see that being a more muted sector in our business over the next 6-12 months or so. So maybe to follow up on that, on the comms business, you talked about weakness in wireless comm infrastructure, but the team has a very strong position on the wired communications infrastructure part of your business, right? You've got a strong position in cloud and hyperscale data center, optical connectivity, strong position in accelerated compute and AI power management. So how does this particular subsegment wired look like, as you think about sort of the next few quarters? Yeah, well, the wired business, you know, as you pointed out, Harlan, we have really two or three big technology plays there. One is the control of the optical modems, you know, with multiple generations of traction there. So big data center companies are enormous users of that technology. And their, you know, spend in the data centers has been down for the last few quarters. We expect it to pick up in 2024, so that should bode well for that part of our portfolio. And obviously, power management, there's, you know... In the computing world these days, performance equals power, power equals performance. Mm-hmm. So there's more and more focus on energy, you know, efficient energy usage, and that's a place where our power management portfolio is more and more important. So, you know, our expectation is in FY 2024, we'll see the wired part of our business do quite well, particularly driven by advanced computing, cloud, and so on and so forth. So, you know, and then once this AGI thing moves out of the realm of hype and really becomes, when natural language processing becomes, you know, a very, a very natural, a very naturally used technology, that bodes as well, very, very well for our portfolio for the long term. We had the opportunity to come to your Wilmington headquarters, and we hosted a deep dive with Martin's team into, as you mentioned, ADI's opportunity in gigafactories, right? This was a few months back. Martin noted, you know, more than 190 new gigafactories planned worldwide that would drive roughly 10 factories per year, $45 billion of annual CapEx spending by 2030. You know, these gigafactories will be driving demand for your industrial automation, your electronics test solutions. As Martin had pointed out, right, there are nine major process steps in a gigafactory, each of them creating an opportunity for ADI silicon capture. Just wondering if you can walk us through areas within these gigafactories where the team is seeing strong demand pull for your solutions. Yeah. Well, there's these gigafactories are putting more and more automation into play. Yeah. So you want the automation systems to be more precise, so performance is increasing. I'm talking about robotic systems, for example. You want them to be more precise, but you also want to be able to, you know, 40% of the entire electrical grid, for example, is consumed, the energy is consumed by industrial motors. Putting intelligence around these motors, the motor architectures themselves won't change, but the intelligence around these motors will. So more precision, more energy focus- Mm-hmm. -reducing energy by, we think by putting more intelligence on motors, that we can reduce the grid load by around 10%-12%, just given the burden that industrial motors place on the grid. There's more and more instrumentation being used in the steps, for example. You know, when you're building, the demand for electric vehicle batteries these days is going through the roof. But you know, managing the electrochemical process very, very accurately is really important. So there's more and more instrumentation being used in the batteries, in the formation process, in the deployment process, through the life of the battery. So those are two or three areas where we see, the precision of the portfolio that we have being in more and more demand, to be able to improve the accuracy and efficiency of the process, but also the energy consumption. On automotive, last year, at this very period, at this same conference, right? I believe the three large automotive sub-segment drivers for the team, electrification, connectivity, audio processing, right? And combined accounted for back then 35% of your automotive revenues. These three segments have continued to grow strongly, right, even through a weaker macro environment. So currently, what percentage do these three segments sort of represent of the total auto franchise today? And your confidence on, I know you said longer term, right, automotive, low double digits, sort of CAGR, but your confidence on driving year-over-year growth in the auto franchise, even if auto trends continue to weaken, let's say, until fiscal 2024. Yeah. So in-cabin, you know, the in-cabin is probably somewhere in the region of 40% of our total revenue these days, 40%-45%. And that's things like high-quality audio. We're putting more and more road noise, active road noise cancellation- Mm-hmm. Content into these applications as well. Our A2B bus, which moves the media. Yeah T he audio media around the car, virtually all the OEMs now are using our A2B technology. On the safety side of things, our multi-gigabit serial link- Yeah GMSL is kind of the adopted technology now for moving media from cameras, for example. You know, we're looking to bring more and more rich content, more image content from the outside to help us really solve the safety problem in ever increasingly useful ways. So, we've, as I said, built a huge franchise on that. Yeah. On the electrification side of things, the fastest growing part of our automotive business today is the electric vehicle, the battery control circuitry. We've a very large share there. Yeah. As long as the demand for electric vehicles continues to increase, we see that business being a very strong franchise, strong double-digit growth for several years to come. The combination of those three segments is what? Maybe half of your automotive franchise today? Oh, it's much higher. Mm. It's probably 80%. Okay, perfect. And then to follow up on that, in terms of the new product pipeline in automotive, the team talked about a new onboard charging application, right? Silicon carbide-based, which has the potential to drive another $50 of content increase in EVs on top of the strong dollar content capture, you guys currently enjoy today. What's the team's view on the potential revenue opportunity and attach rate of these new sort of onboard charging solutions? Yeah, well, it's very, very early stages at this point in time. Again, what we do with the silicon carbide, we need the silicon carbide capability to do the high-power delivery, but it's the intelligence that we provide around that. It's the system knowledge of the, you know, the application system knowledge. So, I mean, that's something that could be, over the next three, four years, could be a, you know, a very, very high growth driver. And perhaps, you know, getting over the $100 million barrier in a reasonable period of time. I think it's still very formative, so it's hard to be precise about the expectation. Any questions from the audience? We're just about out of time, but I do wanna ask a question around, you know, w hen we think about ADI, we tend to think about strong leadership in analog, strong leadership in power, but the market often, I think, forgets that the team has a very, very strong position in digital signal processing, right? In fact, you're still a top supplier of standalone DSP processors. Many of your mixed signal RF solutions have embedded DSP capabilities with a lot of software programmability. So help us understand how critical DSP and software plays in being a strong differentiator for your solutions, and maybe just give us a few examples where you have integrated, you know, mixed signal, analog, and DSP/software. Yeah. So maybe I'll just use one example to describe, you know, the state of play for ADI in the world at the intersection of digital and analog. If you take a 5G radio transceiver, base station transceiver, so we're able to concurrently process multiple carriers, multiple channels at a single time. You know, we have in many of these chips we're building, we might have 25 or 30 microcontroller units, Arm processors, for example. We would also have some, what we would call fixed function digital signal processing- Mm-hmm ... so to be able to accelerate algorithms. Yeah. And so when we bring that chip to market, we also have algorithms that are harmonized, so the software algorithms are harmonized with our hardware, and the customer has a choice. They can buy the hardware standalone, use their own algorithms, or they can use ADI's hardware and algorithms, and sometimes those algorithms will add between 25% and 50% more ASP in a given product. So I think that's a good example of, you know, state-of-the-art. We're on 14 nm technologies today, 14, 16 nm. So digital is something that is, I think, in the minds of investors, not synonymous with ADI. Right. You know, we, we sell multiple hundreds, more than $500 million worth of standalone digital products every year, and, it's been an important part of the evolution of the company as well. And, by the end of this decade, most of what we do will be software-enabled and software-defined. Perfect. Well, we're just about out of time, Vince. Thanks for the insights today, and looking forward to continued strong financial performance from the ADI team as we move into fiscal 2024. Great. Great conversation. Thank you very much. Thank you, Harlan. Thank you. Thank you. Thank you.