Greetings. Welcome to the Lattice Semiconductor second quarter 2022 earnings call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I'll now turn the conference over to your host, Rick Muscha. You may begin. Thank you, operator, and good afternoon, everyone. With me today are Jim Anderson, Lattice's President and CEO, and Sherri Luther, Lattice's CFO, will provide a financial and business review of the second quarter of 2022 and the business outlook for the third quarter of 2022. If you have not obtained a copy of our earnings press release, it can be found at our company website in the investor relations section at latticesemi.com. I would like to remind everyone that during our conference call today, we may make projections or other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such statements are predictions based on information that is currently available and that actual results may differ materially. We refer you to documents that the company files with the SEC, including our 10-Ks, 10-Qs, and 8-Ks. These documents contain and identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements. This call includes and constitutes the company's official guidance for the third quarter of 2022. If any time after this call we communicate any material changes to this guidance, we intend that such updates will be done using a public forum such as a press release or publicly announced conference call. We refer primarily to non-GAAP financial measures during this call. By disclosing certain non-GAAP information, management intends to provide investors with additional information to permit further analysis of the company's performance and underlying trends. For historical periods, we provide reconciliations of these non-GAAP financial measures to GAAP financial measures that can be found on the investor relations section of our website at latticesemi.com. Let me now turn the call over to Jim Anderson, our CEO. Thank you, Rick, and thank you everyone for joining us on our call today. We delivered strong results in Q2 with record quarterly revenue, which grew 28% year-over-year, and non-GAAP net income growth of 68% year-over-year. Growth continues to be led by our largest end markets of communications and computing and industrial and automotive. Our growth in these strategic markets is fueled by growing demand for our rapidly expanding product portfolio and continued strong customer momentum. Let me touch on a few additional highlights from Q2. In addition to the strong revenue growth, we expanded non-GAAP gross margin by 700 basis points year-over-year to a record 69.1%. We achieved record non-GAAP operating profit of 38.1%, which was an increase of 900 basis points year-over-year. We further expanded our product portfolio with the launches of our MachXO5-NX device and our Lattice 5G O-RAN solution stack. Let me now provide an overview of our business by end market. In the communications and computing market, revenue increased 13% sequentially and 35% on a year-over-year basis. We're on track to deliver our fourth consecutive year of double-digit growth for this segment. In data center, our dollars of content per server continues to increase due to our growing attach rate, which is now well over 1x, and increasing ASPs. In client computing, where we have a large greenfield growth opportunity, new customer systems began production in Q2, including the new platforms that were announced with Lenovo and LG over the past quarter. Lastly, in 5G infrastructure, we're benefiting from ongoing global deployments with strong revenue growth both sequentially and year-over-year. Turning now to the industrial and automotive market, revenue increased 7% sequentially and was up 30% on a year-over-year basis. Revenue growth was driven by new customer platforms where Lattice has either displaced competitors or brought new functionality and capabilities to the system. Lattice's market-leading power efficiency, in combination with the software content that we provide, has been a key driver for customers adopting Lattice products. We continue to be very excited about the growing customer opportunities for Lattice products in the industrial and automotive segment. Turning now to consumer, revenue declined 17% sequentially and was down 1% year-over-year, reflecting macroeconomic softness in the consumer electronics end market. Because consumer represents less than 10% of our overall revenue, the consumer demand softness was more than offset by growth in our other core strategic markets. I'll now provide some product roadmap highlights. We introduced MachXO5-NX, the fifth device family built on the Lattice Nexus platform. This device family enhances system monitoring and control in multiple applications across our strategic markets with class-leading power efficiency and reliability. Overall, we continue to be pleased with the broad adoption of our Nexus platform across all our market segments. We're also pleased with the revenue ramp of our Nexus products, which we expect to continue to ramp over multiple years. In addition to the continued portfolio expansion of Nexus, we're excited this year to be further expanding our product portfolio with the launch of our Lattice Avant platform. Avant will have 5x the capacity of Nexus, which will double our addressable market and will allow us to address mid-range FPGA applications. Customer engagement and momentum is very healthy and continues to grow, and we believe Avant will create an important new revenue stream for Lattice when it ramps into production. Execution remains on track for launch in the second half of this year, and as we previously mentioned, we expect to hold a public launch event for our Avant customers and partners in Q4 of this year. Turning now to our software strategy. As we've discussed over the past few years, we've been increasing investment in our software portfolio. These investments are focused on making it easy for our customers to adopt Lattice products and get to market quickly. During the quarter, we launched the Lattice 5G O-RAN solution stack, which is the fifth software solution stack in our portfolio of software solutions. The 5G O-RAN solution stack provides customers with the ability to secure data and accelerate network functions. Over half of our new silicon design wins are now enabled by at least one of our five software solution stacks, which increases the value that we're delivering to our customers and the long-term stickiness of our products. In summary, we believe Lattice is well-positioned in the right strategic growth markets with a rapidly expanding product portfolio and accelerating customer momentum. We're pleased with our first half results, and we expect to have a strong second half as well. I'll now turn the call over to our CFO, Sherri Luther. Thank you, Jim. We are pleased with our strong financial results in Q2 as we continued to deliver double-digit revenue growth, significant gross margin expansion, and record profitability. We generated strong free cash flow while investing in our long-term product roadmap. We also returned cash to our shareholders through share buybacks. Let me now provide a summary of our results. Second quarter revenue with a record $161.4 million, up 7% sequentially from the first quarter and up 28% year-over-year. Revenue grew double digits year-over-year in our communications and computing and industrial and automotive market segments, with strong sequential growth as well. Revenue from our consumer market segment was down sequentially and year-over-year, reflecting macroeconomic weakness in the consumer electronics market. Our non-GAAP gross margin increased 140 basis points to a record 69.1% in Q2 compared to the prior quarter, and was up 700 basis points compared to the year-ago quarter. Both the sequential and year-over-year increases in gross margin continued to be driven by strong execution of our gross margin expansion strategy, which we began to execute in early 2019. Non-GAAP operating expenses were $49.9 million, compared to $47.2 million in the prior quarter and $41.5 million in the year-ago quarter. Both R&D and SG&A expenses increased sequentially as we continue to invest in the long-term growth of our business. However, both declined sequentially as a percentage of revenue. Our non-GAAP operating margin increased 180 basis points to a record 38.1% in Q2 compared to the prior quarter and was up 900 basis points compared to the year-ago quarter. We continue to benefit from the gross margin expansion strategy that we began executing at the beginning of 2019. Q2 non-GAAP earnings per diluted share was $0.42 compared to $0.25 in the year-ago quarter, which represents a 68% year-over-year growth. Driving strong cash flow generation continues to be a key focus area for the company. Through the first half of 2022, we have driven a 31% year-over-year increase in operating cash flow. We ended the quarter with $118 million in cash after repurchasing approximately 735,000 shares or $35 million of stock under our existing buyback program. Q2 was our 7th consecutive quarter of executing share buybacks. Let me now review our outlook for the third quarter. Revenue for the third quarter of 2022 is expected to be between $161 million and $171 million. Gross margin is expected to be 69% ± 1% on a non-GAAP basis. Total operating expenses for the third quarter are expected to be between $50 million and $52 million on a non-GAAP basis. In closing, we are pleased with our strong first half results and expect a strong second half of the year. We remain focused on driving sustained revenue growth and profit expansion through the strength and differentiation of our leadership product roadmap. Operator, we can now open the call for questions. Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Mark Lipacis with Jefferies. Please proceed with your questions. I'm sorry. Our first question comes from the line of Hans Mosesmann with Rosenblatt Securities. Please proceed with your question. Hans, are you there? Sorry about that. I was muted, but congratulations, Jim and the team for great execution. What you've done over the past several years is just very impressive. Besides execution and the strategy in terms of gross margins, in terms of new products and software stacks, what is driving this strength in the midst of pretty tough environment? Yeah, thanks for the question. We were quite pleased with the growth that we saw in, you know, first half of this year overall, but in Q2 as well. You know, both from a market standpoint and from a product standpoint. From a market standpoint, you know, growth has really been driven by our big strategic market segments, which are communications and computing and industrial and automotive. If you look at Q2, in comms and compute, we grew 35% year-over-year. We're really pleased with that growth. Continued expansion in, for instance, servers for the data center, where we continue to see expansion of our attach rate, now well over 1x of ASPs. Nice growth in 5G wireless infrastructure as well in Q2. You know, PCs, client computing continues to remain a large greenfield growth opportunity for us in that market. Also really pleased with the results in industrial and automotive. We had quite a strong Q1 in industrial and automotive, but followed that in Q2 with 30% year-over-year growth. We continue to see good, strong growth in new design wins in things like industrial automation, robotics, automotive electronics. We're either displacing competitors or we're bringing some new capabilities to customers, so quite pleased with growth in that market. We did see some softness in our smallest market, which is consumer electronics. We saw a little bit of end market softness there, but consumer represents, in Q2, about 8% of our revenue. 90% of our revenue is in those other growth, strategic segments that I talked about. From a product perspective, we're, you know, we're pleased with the Nexus ramp. We have a lot of new product cycles that are happening right now. Nexus, we launched our fifth new Nexus device in Q2. We now have four of the five are in production. Our fifth device, which we just launched, that'll enter production next year. We have a kind of a layering effect of new products as they ramp into revenue. Nexus, we expect to continue to ramp over the course of multiple years. You know, good growth in both from a market standpoint, but also from a product standpoint. You know, we are, you know, certainly cognizant of the macroeconomic climate and, you know, we're cautious around some of the recessionary pressures that exist out there, certainly monitoring demand signals, you know, very closely. But we're, you know, we're very bullish on the Lattice specific growth drivers that we have, whether that's the market growth drivers I just talked about or the new product cycles. So again, pleased with the first half results, and we are looking forward to a strong second half as well. Hey, Jim, just very quickly. I understand all that, and that's great execution, but maybe much of the momentum is coming from just taking share from your traditional FPGA small players, small FPGA players, and/or, you know, taking share from non-traditional competitors like microcontrollers. Yeah, thanks. It's a combination of both those. We certainly are gaining share versus our traditional FPGA competitors. We can definitely see that we're taking share there in the small FPGA space, but we are also converting microcontroller sockets over to FPGAs as well. It's really a combination of those two. As well as there are cases where we're bringing just brand new functionality and capability that hasn't existed in platforms before. You know, for instance, in the Lenovo platform that we had announced earlier this year. That's completely new functionality that didn't really exist in that platform before. It's really a combination of all those factors. I think, you know, it's interesting when I look at the growth that we've been driving, for instance, in the first half of this year, and you look at, well, what is the source of that growth. Vast majority of that growth is driven by new revenue streams that we've created just within the last, say, 12-18 months. That means new platforms at existing customers, so expanding our footprint at existing customers or bringing on new customers to the Lattice family. You know, we're quite pleased with the freshness of that revenue growth in terms of we're at the beginning of new revenue growth cycles that should last for multiple years. Great. Very helpful. Congrats. Thanks. Our next question now comes on the line of Mark Lipacis with Jefferies. Please proceed with your question. Hi. Thanks for taking my question. I had a question for Sherri and then one for Jim, if I may. Sherri, on the gross margins, you talked about the programs that, you know, have been driving the expansion. As you look in the next quarter, you have higher revenues, but you're expecting flattish gross margins. Could you just review kind of what the puts and takes are? And then maybe at a higher level, you're above, I guess you have an open-ended gross margin kind of target, operating target longer term. You know, at some point, you know, after you hit so many quarters in a row above your target, do you kind of think about reassessing that? I had a follow-up for Jim, if I may. Thank you. Thanks, Mark, for the question. We're really pleased with the results of our gross margin for Q2 at 69.1%. That's another record for us, representing 140 basis points sequential improvement and 700 basis points year-over-year. You may recall that we've been executing on our gross margin expansion strategy now for four years. As we laid it out in 2019, the elements of that, as we described it, are pricing optimization, and higher gross margins from our newer products, really driving some of that sequential as well as year-over-year increase. Since the end of 2018, we've actually driven an increase in gross margin of 1,200, nearly 1,200 basis points. We're really pleased with that progress. Gross margin expansion continues to be a focus area for the company. When you look at you know, you mentioned our gross margin target and kind of how we're thinking about that, and it's really just continuing to focus on gross margin. We've been doing it now for four years and we'll continue to focus on that to drive profitability for the company. Fair enough. A follow-up for Jim, if I may. Jim, you had mentioned to the previous question that you're aware of the, you know, the macro pressures, but that they don't seem to be manifesting in your business. It, you know, it seems to me on a lot of these earnings calls for other semiconductor companies, you hear it seems like a lot of people talk about, you know, what is the concern out there, but companies continue to seem to be reporting really nice results with, you know, with the odd exception here and there. I'm wondering, Jim, is this, you know, is this like the most well-anticipated, you know, downturn that hasn't happened yet in your kind of career as an executive in the semiconductor industry? Does it change how you manage the risk in your business in terms of you know, managing your operations or, you know, even giving guidance? If I look over the last six quarters, you kind of hit the top end of your guidance, if not slightly above the top end over the last six quarters. In the previous, you know, couple of years, you seemed to be right in the middle. It seems like there's a little bit more of a cautionary angle, you know, perhaps as a, you know, out of respect for what macro pressures there might be. If you could just share your thoughts on that, I think that would be helpful. Thank you. Yeah, certainly. Thanks, Mark. Yeah, I think that, you know, when we look at the macroeconomy and we look at, you know, potential inflationary pressures, recessionary pressures, especially as we go into next year, yeah, we just wanna be cognizant of that macroclimate as we're thinking about the business moving forward and, you know, just cautionary or cautious about those potential influences on the business. That's something that is in the front of our mind. We're watching our demand signals very, very carefully. Of course, we always watch that carefully, but, you know, we're being very careful about monitoring all demand signals. With that said, with that sort of, you know, cautionary backdrop, we feel quite strongly and quite good about the Lattice-specific growth drivers that we have that are sort of unique to Lattice. Whether those are some of the market-specific growth drivers that I talked about a little earlier, whether that's growth in servers, where we still believe we have opportunity to expand our attach rates, our ASPs, whether that's growth in new greenfield areas like PC or the great growth that we've seen in things like industrial automation, robotics, and automotive electronics. We see a lot of opportunity in the different markets. Then we're simply going through new product cycles as well. If you look at, you know, Lattice, we're now just at the beginning of the Nexus ramp. We're only in the second full year of revenue from Nexus. We see multiple years of growth in the Nexus product line. We have Avant, which we'll launch in the second half of this year as well. As Avant enters production in future years, that creates an entirely new revenue stream for the company. I would say we're, you know, cautionary on the macroclimate, but, you know, bullish on the Lattice specific growth drivers that we see in front of us. Very helpful. Thank you, Jim. Thanks, Mark. Our next question comes from the line of Alessandra Vecchi with William Blair. Please proceed with your question. I echo the congratulations on the strong results in the tough environment. Jim, if we can maybe delve a little bit deeper into some of the greenfield opportunities, and what's been driving the content gains there. I mean, you mentioned PC, which you've been talking about for the last few quarters, and had some really nice announcements this quarter with LG as well as two sockets in Lenovo. Then, you know, similarly with automotive, if you can just talk a little bit again about if the gains are against the microcontrollers, how we should be thinking about ramps into the back half and next year. Also, how we should be thinking about those greenfield opportunities as a percentage of revenue on total as we look out a couple years going forward. Yeah. Thanks, Alex. You mentioned both automotive and PCs. Maybe I'll touch on both of those. Let me start with automotive. Automotive electronics, we just see as a great long-term growth area for the company. You know, no doubt the average electronic content per auto will continue to rise moving forward, and we're certainly participating in that. Our products are just a great fit for automotive electronics. The flexibility, the software content that we provide, the power efficiency. There's just a number of different places, whether it's ADAS or infotainment systems, where Lattice products are getting designed in. We have a robust design win pipeline, and our automotive revenue continues to grow very well, and again, grew very strong in Q2 as well. We're quite pleased with that, and we look you know forward to you know good long-term growth in that segment. That's one area. Because automotive electronics is a relatively small portion of our revenue today, but we expect to be a good growth contributor over time. You know, that's one area that we see as a relative greenfield opportunity for us, given the potential growth opportunity there over time. In the PC market, you know, our revenue there today is relatively small. If you look at the PC market overall, that's a very large system TAM, and there's a lot of new capabilities, new features that we can bring to a PC that add a tremendous amount of value to the end user experience. We've now announced a couple different systems with Lenovo that are now in production. A ThinkPad system, which we announced at the beginning of the year. We recently announced a Chromebook system. We announced a new system with LG as well. This just represents a tremendous amount of large unit system TAM and a great greenfield growth area for us over time. You know, these will continue to, we expect, grow and contribute to not just growth in the second half of this year. As I said, we expect to have a strong second half relative to first. We expect that to continue to grow in the coming years as well. Great. That's really helpful. Not to harp on gross margin, but if I back out the pure gross margin royalty revenue of the last couple quarters from a product standpoint, the underlying gross margin has been tremendously strong, as we've alluded to. How do we think about the structural gross margin a few years out? You're starting to approach Xilinx levels from before they got acquired by AMD, which seems like an achievable level. Similarly, if we do go into a downturn, even given your secular drivers, it seems to me like your gross margin should be relatively robust even at these elevated levels. Is that a fair statement? Yeah. We believe there's good durability in our gross margin just based on kind of the drivers underneath and as we look forward as well. As Sherri mentioned in her comment earlier, first of all, just as a reminder, you know, we began our gross margin expansion strategy at the beginning of 2019. We're in our fourth year of executing on that gross margin expansion strategy. That had three different elements in it. It had pricing optimization, product cost improvements, and then mix improvement in the business over time. We're pleased at the progress we've made over the past years. Certainly Sherri's pleased. I know that. You know, it continues to be a focus area for us moving forward. We do see, you know, continued opportunity in gross margin. One of the areas that Sherri alluded to was new product ramps. Our new products are designed to be accretive to the overall company margin. We see that as beneficial to the company moving forward, whether it's Nexus ramping or Avant in the future. I would say that another thing that we've seen in the business over the last six or 12 months is we're seeing a high attach rate of our software solutions to our new hardware design wins. If you look at design wins for Lattice Silicon over the last, say, 12 months, the majority of those design wins have a software attach, meaning they're enabled in some way by one of our five software solution stacks. Generally, when we attach software to our silicon in the solution sale, we see higher ASPs in that too. That's another upward or tailwind on our gross margin. We do see, you know, additional opportunity moving forward and durability in the gross margin. That was extremely helpful. Thank you so much. I'll jump back into queue. Thanks, Alex. Our next question comes from the line of Matt Ramsay with Cowen. Please proceed with your question. Yes. Thank you very much. Good afternoon. Jim, I think it's, I don't know, kind of consensus that one of the areas in digital semis where we still see a pretty wide supply-demand gap is in FPGAs. I obviously, with some of the things happening in the PC market and the smartphone market, some of those supply-demand gaps in other parts of the industry are starting to close a bit. I wonder if you might give a few comments just on the FPGA market in general and how you feel, supply is relative to demand out there. Has that gap started to shrink at all in your markets, or it's still pretty consistently wide? Thanks. Thanks, Matt. You know, I can mostly just comment on our business. What I would say is that, I feel like we've done a good job of supporting our customers. Certainly the, you know, the supply chain, the overall semiconductor supply chain remains tight. I think it'll continue to remain tight through the end of this year into next year. We are seeing some signs of improvement. You know, we've recently, over the last quarter or two, seen some incremental supply from our suppliers, incremental capacity beyond what they had committed to us for this year. We see that as a positive sign for the second half of this year and into next year. We do feel like relative to some of our competitors, we've done a good job supporting our customers, and I think our customers recognize that, and I think that's helped accelerate, in some cases, transitions from our competitors towards Lattice, and so that has been helpful. It's not that we're immune to the supply chain crisis at all. Certainly, you know, we're affected by the same supply chain tightness. But I think overall, we've done a good job navigating that and supporting our customers, you know, overall. You know, we do see some good signs of improvement, like I said, over the last couple quarters, and we expect supply to continue to improve into next year. Thanks for that, Jim. Just as a follow-up question for Sherry. Maybe you could talk to us a little bit about OpEx growth. I know I have conversations with some of your peer companies about inflationary costs on wages. Obviously, as Jim just mentioned in his comments, the supply chain remains tight, and you guys aren't immune. Just investments you're making, hiring, wages, just how should we think about OpEx sort of trending or just kind of staying within the band that you're in as a percentage of revenue? Thanks. Yeah. Thanks, Matt. If you look at our OpEx, actually it grew 20% year-over-year. Where that came from was majority in R&D. We're investing 24% growth year-over-year in R&D in our product roadmap for the long-term growth of our company. You've seen that we've been doing that for some time now, and we definitely have a bias for investing, and we wanna do it in a very controlled and disciplined way. Investing for the long-term of growth of our company. You've seen our product launches, our fifth device, as well as our 5G O-RAN solution stack that we announced in Q2. Avant coming out in the second half, as Jim mentioned. We continue to invest in our product roadmap. That's one of our top priorities. And then when you look at, you know, you mentioned inflation, some of that's a little bit, you know, hard to kind of separate out. But we are continuing to hire. I think you see in a lot of our LinkedIn social profiles, all of that, you see there's lots of hiring going on in R&D. And again, that's to continue to make sure that we've got, you know, the right focus and developing the right products that we have. You can continue to see that bias for investing within SG&A as well, you see that there is a sequential increase there. That's where we're investing in our customer support and our demand creation. That's very important as well. We are continuing to invest in the company. Thank you very much to you both, and congrats on the results. Thank you. Thanks again, Matt. Our next question comes from the line of Chris Rolland with SIG. Please proceed with your question. Hey, guys. I echo the congrats. I guess my question is, and I get this from investors quite a bit, people would love to know, what kind of products were legacy products, as a percentage of sales. You know, what are the, as a percentage of sales, are the products that have been launched, under your management tenure? Is there any rough kind of idea of what the split might be at this point? Yeah, thanks for the question, Chris. We don't break out product line specific revenue, but what we can say is we kind of think about it as Nexus products and pre-Nexus products. What we can say is, both categories have continued to grow. You know, you would expect Nexus products to continue to ramp and grow. Those products are new. As we've mentioned, we've launched five products. Four of the five are in production. The fifth, which we just launched, will go into production next year. You can expect us to continue to launch additional Nexus products moving forward. Those products will ramp over the course of multiple years. Even the pre-Nexus products, we've seen very good growth in the pre-Nexus products. New design wins, new applications that those are getting designed into. We believe that our software solution stacks in particular have been very helpful in getting our pre-Nexus products designed into new applications that we may not have been able to support in the past. We're seeing growth in both of those areas. Frankly, we want both pre-Nexus and Nexus products to continue to grow. You know, moving a little further out, you know, as we launch Avant in the second half of this year and bring that into production in future quarters, that'll add an additional revenue stream that's completely additive to the company because it's in a different part of the FPGA market that we don't address today. It addresses mid-range FPGA applications. Avant will double our addressable market, create a new revenue stream for the company over time. We feel good about, you know, the growth of kind of all of those categories moving forward. Great. Thank you, Jim. Either Jim or Sherri, looking out maybe next quarter or even beyond, I don't know if you could force rank the segments for us in terms of growth or just some broad strokes, you know, between the three segments, but even breaking it down into comms versus compute or, something like that. I guess also, do we get a bounce back in consumer or do you think those trends continue as well? Yeah. Thanks, Chris. I'll give a little bit of color on the Q3. If you look at the midpoint of our guide for Q3 relative to Q2, you know, we're guiding sequentially up in Q3. We do expect growth in sequential growth in communications and computing and industrial and automotive. On consumer, we expect consumer to be roughly flat from Q2 to Q3. We're being a little bit more cautious about that segment given the, you know, kind of broader consumer electronics softness that the industry has seen. We do expect, again, sequential growth in our large strategic market segments of comms and compute and industrial auto. Perfect. Thanks, and congrats again, guys. Thanks, Chris. Just as a reminder, if anyone has any questions, you may press star one on your telephone keypad to join the question-and-answer queue. Our next question comes from the line of Tristan Gerra with Baird. Please proceed with your question. Hi. Good afternoon. My first question is about backlog and pricing. You've mentioned your expectation for the market to remain tight, you know, through end of this year and part of next year. How far is your backlog extending currently, and how does that compare, you know, earlier this year? Also, are you able to still provide the same type of price optimization over the next, let's say, couple of quarters as what you've done in the past as we start seeing, you know, lead times coming down a bit for some products? Generally, we're seeing pricing stable of all in semis but not rising every quarter like we saw last year. Any commentary you may have on, you know, not so much your new products which you mentioned are basically going to be ASP accretive, but on your existing product, you know, what's your ability to continue on the path of higher pricing? Yeah. Thanks, Tristan. On the first part of your question around backlog, I think you're asking backlog now versus, I think you said earlier this year. I would say that our backlog has remained pretty stable in sort of total backlog that we've had earlier this year versus now. You know, obviously, we've been servicing the backlog, but at the same time, you know, our new bookings have been healthy. We continue to see healthy levels of bookings. Yeah, stable levels of backlog and healthy booking levels is what I would say. On pricing, over the next couple quarters, I think, you know, if you look back, you remember we started our pricing optimization strategy back in 2019, so we're in our fourth year of that. We've gained pretty good understanding and a pretty good system of how we do our pricing optimization. I do think there's, beyond just new product ramps, there continues to be opportunities to optimize pricing, in our business kind of irrespective of, you know, kind of the rest of the market. I think there continues to be areas where we can better optimize pricing. Really that's about making sure that our products are priced correctly for the value that they're bringing to our customers and the end markets. Maybe to tie in one of the comments that I made earlier is, you know, even on existing products, let's call them pre-Nexus products, when we're able to attach software to those products, where we're not just selling the hardware device, but we're selling along with that the software portfolio solution, whether that's sensAI or that's our newest 5G O-RAN solution stack or any of the other three software stacks in our portfolio of five, that's us bringing more value to our customers, bringing more of the solution. When we bring more of the solution, that's valuable to our customers. That's something that we tend to get paid a higher ASP for. That's another area where we can continue to optimize ASPs by just bringing more value through our software. Of course, that software has the other nice side effect of, it helps our customers convert designs away from our competitors towards Lattice more quickly. It helps them get to market more quickly. It also creates, we believe, long-term stickiness, for our products, moving forward as well. For a variety of reasons, you know, that software strategy is an important part of the value that we create for our customers moving forward. That's great. Then my second question, which I guess is related to what you just mentioned. If you could talk about, you know, product stickiness. You've been, for example, now really successful in servers for quite some time with your root of trust chip. And I know there is competition out there with MCU or ASIC solutions, but looks like you continue to gain some good traction. Is that a function of performance? And also, do you expect your ramp in PC to be sticky for more than just a couple of years. As such, you're not concerned about those design wins eventually reverting to a non-FPGA socket? Yes, I think you first were asking about servers and then secondly, PCs. In servers, let me start there. Yeah, we're just really pleased with the growth that we've been able to drive in servers that go into data centers, whether those are hyperscale data centers or traditional enterprise data centers. Really pleased with the growth we've driven over the past years. It's again a combination of we've driven attach rates higher, which is effectively us finding new places with our customers for Lattice devices to get designed into server systems. Our attach rate is now well over one X, which means on average a server ships with more than one Lattice piece of silicon in terms of global server shipments. We can see continued opportunity for more sockets that more capability that Lattice can bring to servers in the future. Of course, we've continued to, with each new generation, bring just more capability, more functionality, which has helped us continue to improve ASPs over time. The combination of attach rates and ASPs has driven a very nice, healthy growth in our dollars of content per server. We continue to focus on growing that further moving forward. We do believe that that's that is a sticky position because it's not just the hardware that we provide, the chip that we provide, but in many cases, we're providing layers of software underneath that as well. In PCs, very similar is that it's not just the chip that we're providing, but it's layers of software on top of that. For instance, in those new platforms that we've announced with Lenovo, for instance, earlier this year, that's not just the chip that we're providing, but there's layers of software underneath there and or above the chip that that support the full solution stack. I think that's part of the stickiness that we create on a multigenerational basis. Frankly, you know, the flexibility that our FPGAs provide is a big value to our customers. Whether you're a server customer, a PC or an industrial or automotive customer, the flexibility of an FPGA is a big benefit in their system design because they know that they're gonna need to add new features, new system capabilities over time, and the ability to add that by just simply reprogramming the FPGA versus having to do a whole new hardware design or a new ASIC design, that's a big benefit. That's a big time to market benefit. That's a big strategic flexibility benefit. For a number of our customers across our markets, the flexibility and power efficiency of our FPGAs is one of the main reasons that they get designed into the systems initially and remain, you know, designed in over a multigenerational basis. Great. That's very useful. Thanks so much for taking the time on that question. Thanks, Tristan. Our next question comes from the line of David Williams with Benchmark. Please proceed with your question. Hey, good afternoon, and congrats on the success and the wins here. First question, I guess, is really about the Lenovo design win. That seems to be moving down, maybe migrating from what we would have thought to be kind of the enterprise segment into the Chromebooks and the lower tier segment. Just kind of curious how you see that and what that opportunity looks like if you think out maybe two to three years. Yeah. Thanks, David. You know, we did see initial adoption of our designs in more the enterprise class systems like the Lenovo ThinkPad. We also announced, as you said, the Lenovo Chromebook. We really see opportunity for our devices to be used in all sorts of PCs, whether those are enterprise or more consumer-oriented PCs. Again, for us, it's a large greenfield growth opportunity, you know, roughly 300 million systems a year in PCs. We believe that the capabilities and features and the really end user experience that we're able to bring to the PC is certainly relevant in the enterprise context, but also relevant in consumer context as well. There's many features that we can bring that are important to a consumer. There's a tremendous usage model that we bring where we can say help save a significant amount of battery power. That's helpful to both enterprise users as well as consumers. We really see the whole PC segment as potential TAM over time. Whether it's a Chromebook system or a ThinkPad system, we're happy to add content to those systems and to ramp those over time. We see it as just a good long-term greenfield growth area. Great. Thanks for the color. Just kind of thinking about the data center, you had talked about the server attach rate strong. Just curious if you're seeing anything specific within the data center in terms of demand or any changes in maybe customer behavior there. Yeah. Thanks, David. In data center, we continue to see very strong demand from our data center server customers. You know, again, most of our growth, remember, is not so much driven by the end market growth itself, the growth in the data center. Our growth is much more driven by the dollars of content that we've seen increasing in each new generation. Which is of course driven by our increasing attach rate in ASPs. That's been a much bigger factor in our growth. We continue to see, you know, very strong demand from our server customers. Then the other thing that I would note is just a reminder that our solutions are CPU agnostic. This is actually really important to our customers. Our server customers really value the fact that the Lattice hardware and software solutions that we provide are agnostic to the CPU flavors. Whether that's an x86 processor that comes from Intel or AMD or, potentially an Arm processor as well, we support all flavors of CPUs. You know, we're in production, of course, across all those, both Arm as well as x86 processors. To the extent that there's share shift that happens among the CPU vendors, you know, we're buffered from that share shift because we're supporting our customers across multiple CPU flavors and platforms. Thank you. Again, as a reminder, if anyone has any questions, you may press star one on your telephone keypad to join the queue. Our last question comes from the line of Richard Shannon with Craig-Hallum. Please proceed with your question. Hi, Jim and Sherri. Thanks for taking my questions. I guess I got just two of them. First one, Jim, you mentioned half of your current hardware designs have software attached to them. Obviously they're gonna roll out over a couple of years after the win here, but it kind of helps us think about the contribution of software to your overall revenue stream, which you haven't really quantified in the past. Maybe you can help us with that today. My question to that topic is, of these designs where you have software attached, how do we think about the amount of content adder the software has to it? Any way you can quantify or arrange it? I mean, is this just 5% of that hardware or 25 or somewhere in the middle? Just kind of my personal guesses, but any way you can characterize that for us? Yeah. Thanks, Richard. You know, we haven't given a specific number. The reason is it can depend a lot on the application. What we are seeing is where we get software attached, there generally is a higher ASP. Now that additional ASP can be a significant range depending on the type of application. Some applications, you know, the value of that software content is valued very significantly, and it's a significant ASP uplift. In some other applications, it may be less, but on average, we're definitely seeing an ASP uplift when we get a software attached. On the first part of your question, you're absolutely right that I was talking in terms of new design wins over the last 12 months. As those new design wins now transition into revenue, they layer in over the coming years. Those new design wins with the software attached and the higher ASPs are beneficial to us over time. It's another way of saying it is, as we look to the revenue growth, the new revenue growth moving forward, the majority of that new revenue growth is enabled by software attached, which generally has a higher ASP moving forward. Okay, fair enough. My second question was following up on an earlier one around Nexus and the contribution there and, haven't given us any way to think about the contribution from Nexus versus pre-Nexus. But is there a point in time or a percentage of revenues above which you'll start disclosing that? Because I think it. I agree it'd be very helpful for people to think about. I'm assuming it's a fairly low percentage today, but, is there a point where you'd commit to providing that sort of a number so we can start to do those splits? Yeah, we'll look to potentially sharing that in the future. Just as a reminder is, Nexus is still early in its ramp, right? We are in just the second year of the full year of revenues. 2022 will be the second year of a full year of revenue from Nexus. You know, we expect the Nexus product lines to ramp over multiple years and to continue to grow as a percentage of revenue over multiple years. You know, breaking that out separately may be something that we do in the future. We'll take that into consideration. Okay, perfect. That'd be great. That's all the questions from me. Thank you. Thanks, Richard. We have reached the end of the question and answer session. I'll now turn the call back over to CEO, Jim Anderson, for closing remarks. All right. It's the operator, and thanks everybody for joining us on the call today. Overall, I'm quite pleased with the execution that we saw from the company in the first half of this year. I'm very pleased with the strong financial results that we delivered in the first half, and we do expect the company to have a strong second half of the year as well. Of course, we'll always look forward to giving you further updates on our next earnings call. Operator, thank you, and that concludes today's call. Again, this concludes today's conference, and you may disconnect your line.