Welcome everyone to the MPS 4th quarter 2022 earnings webinar. My name is Genevieve Cunningham. I will be the moderator for this webinar. Joining me today are Michael Hsing, CEO and founder of MPS; and Bernie Blegen, VP and CFO. In the course of today's conference call, we will make forward-looking statements and projections that involve risk and uncertainty, which could cause results to differ materially from management's current views and expectations. Please refer to the safe harbor statement contained in the earnings release published today. Risks, uncertainties, and other factors that could cause actual results to differ are identified in the safe harbor statements contained in the Q4 2022 earnings release and in our latest 10-K and 10-Q filings that can be found on our website. MPS assumes no obligation to update the information provided on today's call. We will be discussing gross margin, operating expense, R&D, and SG&A expense, operating income, other income before income taxes, net income, and earnings on both a GAAP and a non-GAAP basis. These non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered as a substitute for or superior to measures of financial performance prepared in accordance with GAAP. A table that outlines the reconciliation between the non-GAAP financial measures to GAAP financial measures is included in our Q4 and full year 2022 earnings release, which we have filed with the SEC and is currently available on our website. I'd also like to remind you that today's conference call is being webcast live over the Internet and will be available for replay on our website for one year, along with the earnings release filed with the SEC earlier today. I'd like to turn the call over to Bernie Blegen. Thanks, Gen. For the full year 2022, MPS achieved record revenue of $1.79 billion, growing 48.5% from the prior year. This is despite industry-wide supply chain capacity constraints. This performance represented consistent execution against our strategies and having more tier one customers recognize MPS for advanced technologies, product quality, and excellent customer support. Here are a few highlights from 2022. We introduced a new product line of isolated power modules for applications exceeding 1 kW with a fully integrated controller, isolator, and power devices. Our initial revenue ramp for this highly integrated and reliable solution is targeted for 2024. These modules are critical building blocks for power management applications for data centers, EVs, plug-in traction inverters, EV chargers, solar power, wind turbines, battery power storage, and other industrial applications. Our products are designed to set the industry standard for these critical system-level applications. MPS' first advanced data converter products for high-precision industrial and medical applications were made commercially available during 2022, and we expect to have an initial revenue ramp in 2023. We continued to diversify our global footprint with expansion of our R&D centers, supply chain partnerships, and facilities outside of China to better match our resource distribution with our customers' geographic demand profile. With our global presence, we believe MPS is in a strong position to support our customers worldwide. Turning to our full year 2022 revenue by market segment compared with 2021, enterprise data revenue was up 116.1%, storage and computing revenue up 76.8%, communication revenue up 53.2%, automotive revenue up 46.8%, industrial revenue up 18.6%, and consumer revenue up 13.2%, demonstrating broad-based full year 2022 revenue improvements. Full year 2022 enterprise data revenue grew $135.1 million over the prior year to $251.4 million. This 116.1% increase is primarily due to higher sales of our power management solutions for cloud-based CPU and GPU server applications. Enterprise data revenue represented 14.0% of MPS's total revenue in 2022, compared with 9.6% in 2021. Storage and computing revenue for 2022 grew $196.7 million over the prior year to $452.6 million. This 76.8% increase primarily resulted from strong sales growth for storage applications and enterprise notebooks. Storage and computing revenue represented 25.3% of MPS's total revenue in 2022, compared with 21.2% in 2021. Communications revenue grew $87.4 million to $251.5 million. This 53.2% improvement reflected higher sales of products for both 5G and satellite communications infrastructure applications. Communications revenue represented 14.0% of our 2022 revenue, compared with 13.6% in 2021. Automotive revenue grew $95.7 million to $300.0 million in 2022. This 46.8% year-over-year gain primarily represented increased sales of our highly integrated applications supporting automated driver assistance systems, the digital cockpit, and connectivity. Automotive revenue represented 16.7% of MPS's full year 2022 revenue, compared with 16.9% in 2021. Industrial revenue grew $34.4 million to $218.2 million in 2022. This 18.6% year-over-year increase primarily reflected higher sales in applications for smart meters and industrial automation. Industrial revenue represented 12.2% of MPS's full year 2022 revenue, compared with 15.3% in 2021. Consumer revenue grew $37.2 million to $319.5 million in 2022. This 13.2% year-over-year increase primarily reflected increased product sales for home appliances and smart TVs. Consumer revenue represented 17.8% of MPS's full year 2022 revenue, compared with 23.4% in 2021. Let's talk about the general business conditions. During our Q3 2022 earnings call, we highlighted the customers were becoming more concerned with near-term business conditions and order patterns might oscillate in the near future. As a result of this change in ordering patterns, we indicated our inventory levels would likely catch up to our target of 180-200 days and possibly be higher in the near term. During the quarter, ordering patterns stabilized as customer-requested pushouts slowed. While this is positive, customers' orders are still trending below historic norms, and our Q4 2022 inventory is above our target levels. As a result, we remain cautious about near-term business conditions. We also believe MPS can swiftly adapt to market changes, as we have done so successfully during similar macroeconomic changes in the past. Switching to Q4, MPS had a record fourth quarter, with revenue of $460.0 million, down 7.1% from revenue generated in the third quarter of 2022, but up 36.7% from the comparable quarter of 2021. On a year-over-year base comparison by market segment, fourth quarter 2022 revenue for automotive grew 72.8%. Enterprise data revenue increased 69.0%. Storage and computing revenue grew 55.0%. Communications revenue grew 40.1%, and industrial revenue grew 13.3%, while consumer revenue decreased 20.1%. Fourth quarter 2022 GAAP gross margin was 58.2%, down 50 basis points from third quarter 2022, but 60 basis points higher than the fourth quarter of 2021. Our GAAP operating income was $136.9 million, compared to $151.9 million reported in the third quarter of 2022, and $78.6 million reported in the fourth quarter of 2021. Fourth quarter 2022 non-GAAP gross margin was 58.5%, 50 basis points below the third quarter of 2022, but 60 basis points higher than the fourth quarter of 2021. The year-over-year expansion in fourth quarter non-GAAP gross margin was largely due to a shift in sales mix favoring high-value greenfield products and operational efficiencies, which more than offset higher product input costs. Our non-GAAP operating income was $174.1 million, compared to $193.7 million reported in the prior quarter, and $102.0 million reported in the fourth quarter of 2021. Let's review our operating expenses. Our GAAP operating expenses were $130.9 million in the fourth quarter, compared with $139.0 million in the third quarter of 2022, and $115.3 million in the fourth quarter of 2021. Our non-GAAP fourth quarter 2022 operating expenses were $94.8 million, down from the $98.4 million we spent in the third quarter of 2022, and up from the $83.0 million reported in the fourth quarter of 2021. On both a GAAP and a non-GAAP basis, fourth quarter 2022 litigation expense was $3.2 million, compared with a $2.1 million in Q3 2022, and a $420,000 credit balance in Q4 2021. The fourth quarter 2021 litigation credit reflected an IP settlement and refund of a legal retainer. The differences between GAAP and non-GAAP operating expenses for the quarters discussed here are primarily stock compensation expense and income or loss from an unfunded deferred compensation plan. Fourth quarter 2022 stock-based compensation expense, including $1.0 million charged cost of goods sold, was $35.3 million, compared with $43.0 million recorded in the third quarter of 2022. The quarter-over-quarter change in stock compensation expense reflected a change in plan vesting assumptions. Switching to the bottom line. Fourth quarter 2022 GAAP net income was $119.1 million or $2.45 per fully diluted share, compared with $2.57 per share in the third quarter of 2022, and $1.51 per share in the fourth quarter of 2021. Q4 2022 non-GAAP net income was $154.0 million or $3.17 per fully diluted share, compared with $3.53 per share in the third quarter of 2022, and $2.12 per share in the fourth quarter of 2021. Fully diluted shares outstanding at the end of Q4 2022 were 48.5 million. Now let's look at the balance sheet. As of December 31st, 2022, cash equivalents and investments totaled $739.6 million compared to $738.1 million at the end of the third quarter of 2022. For the fourth quarter of 2022, MPS generated operating cash flow of about $52.2 million compared with Q3 2022 operating cash flow consumed of $18.2 million. Fourth quarter 2022 capital spending totaled $12.8 million. Accounts receivable ended the fourth quarter of 2022 at $182.7 million, or 36 days of sales outstanding, compared with $153.4 million or 28 days of sales outstanding reported at the end of the third quarter of 2022, and $104.8 million or 28 days reported at the end of the fourth quarter of 2021. Our internal inventories at the end of the fourth quarter of 2022 were $447.3 million, up from $397.4 million at the end of the third quarter of 2022. Calculated on a basis consistent with our past practice, and as you can see on the webinar video, days of inventory rose to 212 days at the end of Q4 2022 from the 167 days at the end of the third quarter of 2022. Historically, we've calculated days of inventory on hand as a function of the current quarter revenue. We believe comparing current inventory levels with the following quarter's revenue provides a better economic match. On this basis, again, you can see days of inventory increased to 214 days at the end of the fourth quarter of 2022, from 188 days at the end of the third quarter of 2022. I would now like to turn to our Q1 2023 outlook. We are forecasting Q1 2023 revenue in the range of $440 million-$460 million. We also expect the following: GAAP gross margin in the range of 57.4%-58.0%. Non-GAAP gross margin in the range of 57.7%-58.3%. Total stock-based compensation expense of $40.2 million-$42.2 million, including approximately $1.2 million that would be charged cost of goods sold. GAAP R&D and SG&A expenses, including litigation expenses between $135.1 million and $139.1 million. Non-GAAP R&D and SG&A expense to be in the range of $96.1 million-$98.1 million. This estimate excludes stock compensation expense, but includes litigation expense. Beginning with the Q1 2023 outlook, MPS will no longer separately forecast litigation expenses. Interest income is expected to be in the range from $1.8 million-$2.2 million before foreign exchange gains or losses and charitable contributions. The non-GAAP tax rate for Q1 2023 will be 12.5%. The non-GAAP tax rate remains unchanged from 2022, as there have not been any material changes in tax regulations. Fully diluted shares to be in the range of 48.2 million-49.2 million shares. Finally, I'm pleased to announce a 33% increase in our quarterly dividend to $1 per share from $0.75 per share for stockholders of the record as of March 31st, 2023. In conclusion, while we remain cautious about near-term business conditions, we believe MPS can swiftly adapt to market changes and take advantage of the current environment to focus on business development and investing in infrastructure necessary to support long-term growth. I will now open the webinar up for questions. Thank you, Bernie. Analysts, I would now like to begin our Q&A session. As a reminder, if you would like to ask a question, please click on the Participants icon on the menu bar and then click the Raise Hand button. Our first question is from Quinn Bolton of Needham. Quinn, your line is now open. Hey, guys, congratulations on the strong results and the nice outlook in this environment. I guess I wanted to start, Bernie and Michael, the computer storage business was much stronger than at least I expected in the fourth quarter. You grew revenue quarter-on-quarter when, you know, the rest of the PC market is clearly experiencing softness and inventory correction. I guess, can you give us, you know, sort of your outlook? How do you see that business trending over the next couple of quarters? I've got a follow-up. Thank you. Sure. I think that there's been a lot of press recently around weakness in notebooks as far as unit sales. In addition, we've started to see some word in here about declines also in the memory market. Interestingly, memory continued to be very strong for us, offsetting a decline in notebooks. As we look ahead here, we actually see notebooks beginning to improve in the early part of 2023, and probably those gains will offset a decline in memory. We're basically looking at this category, at least for the first half of the year, to be flattish. Oh, okay. The, the one component, the AI portions and, still remain to be very strong in the near futures, and then we see, a very high growth. Absolutely. In the enterprise data, we've really got good traction with the GPUs for artificial intelligence. That should really be one of our growth drivers in the first half of 2023. That was gonna be my next question. Enterprise data was down slightly in the fourth quarter, but it sounds like you see the ramp or just strong results in the first half driven by, it sounds like specifically GPUs. Is that right? Yes. That's related to artificial intelligence. Yeah. When we look at CPUs, in the enterprise data, there's still initial softness as we're waiting for the platform launches for both Sapphire Rapids and Genoa to take off. Do you expect that in the second half then, the CPU to kind of kick in more second half of the year? Yes. Perfect. Thank you. Our next question is from Tore Svanberg of Stifel. Tore, your line is now open. Yes, thank you. Congratulations on another record year. Michael, I was hoping you could talk a little bit more about the power isolation module business that you expect to ramp in 2024. Is this still based on the company's BCD technology, or are you now starting to venture into some newer technologies? I'm just curious, right, because, you know, you haven't talked a whole lot about, you know, potentially getting into silicon carbide or GaN or anything like that. We do have programs that are going to wide bandgap materials. In the past, I think we talk about it in we have a program to investigating and develop those devices since 2017. Now we see the first result. We do have some samples ready, but they're not in the production yet. My prediction is that they're somewhere in the middle of the year, or second half of the year. Related to your questions about the isolated modules, when any high powers, it's traction inverters, solar and solar inverters and data centers, also chargers, onboard chargers and all these and wind turbines. All of these have a one basic component in all these high, very high power applications, which is all the power devices is driven by using the isolated modules. MPS is using, again, using our own BCD process and as well as wide bandgap materials. We combine together and are making a very simple, nice, and a very easy to use power modules for those type of applications. Some of these products are already in production in EVs currently. Things that we expect at a higher growth in the next couple years. That's very, very helpful. And as my follow-up, could you just give us an update on the manufacturing footprint, you know, both from a, you know, capacity perspective, but more importantly about diversification. You know, you've talked about, you know, looking at all sorts of regions to partner with, so some new manufacturing partners. Yeah, both the capacity, but then also from a geographical perspective, perhaps an update there. Thank you. Yeah. We see as everybody else see it in the geopolitical tensions. As you know, MPS in the past, we always want to be a local company in every political regions. We did that successfully in the R&D side. Because for one thing, it's close to customers, other ones and other ones we isolated from all these tensions from between the countries. For the manufacturing side, currently we can fulfill all our customer demand to demand for wherever they want to manufacture it. And of the year or by the next, by end of the year, next years, we will have fully ramped for the new capacities, just in case the wars are really separated. Great. Thank you so much, and congrats again. Thanks, Tore. Our next question is from Alex Vecchi of William Blair. Alex, your line is now open. Oh, nobody? Our next question is from Matt Ramsay of Cowen. Matt, your line is now open. Thank you very much. Good afternoon, guys. Can you hear me okay? Yes. Hey. Hey, Michael. Hey, Bernie. The one question that I wanted to ask you that we've heard, and you guys have I guess, addressed in your prepared script how you're working to move sort of the operations and the manufacturing footprint and other pieces outside of China to, in the long term, more sort of align with your TAM and revenue mix for the really, really long term of the company, and you've been very clear about those plans. There's been some more, I guess, acute reports of maybe some customers that want to very quickly use product sources outside of China, and you'll probably know some of those reports that I'm talking about. I guess, have those impacted your revenues at all? Are you seeing any strange behaviors from customers that maybe wanna move and source product outside of China more quickly than you're able to? Or are you already sourcing outside of China to support many of your global customers? Thanks. Yeah. It's a misconception that for MPS is that we are a lot of manufacturers that's in China. That's true, and but it's a misconception. Like we do in a pre-COVID, we do at least half of our manufacturer and at least we have the capacities, is outside the countries or outside China. To answer your question, we have a zero impact in the in for whoever customers request to manufacture in the outside of China in the past and the futures. No. All right. Thank you for that, Michael. That's really clear. It's just a question we get a lot. I wanted to talk a little bit about the consumer business, which is kind of the maybe the least important strategic segment, but also the most volatile if you look at where, I guess, the numbers came in in the fourth quarter. I guess what I'm wanting to understand a little bit is the philosophy that you guys might have if and when some of those consumer markets and the China market in general recover. Are you excited to keep that segment down around 10% of revenue and will continue to prioritize everything else? Or is that a business that you want to serve, Michael, as it potentially rebounds? Thank you. Yeah. Again, I said, I mean, in the past is last year capacity issues, like, it constrained the consumer growth. We do have a lot of opportunity. We just didn't pick it up because of the capacity issues. In the long terms, in the past, as you know that, again, and we'll be a lot more aggressive for, in this consumer market segment. Because when you react to a price and you react to the opportunity and how fast you react to the opportunity, and within the six months, you will see the turnup, you will see the a big number change in the consumer segment. That's what we will do. Matt, keep in mind, the resilience of our business model has to do with the diversity of the end markets, the customers, the geographies that we serve. Consumer, while it has dropped to around 10% for the quarter, remains a very important part of that strategy, and we'll continue to invest in it. Thank you very much, guys. I appreciate it. Our next question is from Alex Vecchi of William Blair. Alex, your line is now open. Hello? Our next question is from Gary Mobley of Wells Fargo. Gary, your line is now open. Hey, Michael. Hey, Bernie. Hope all is well, and thanks for taking my question for the first time as a covering analyst. I related to that, I apologize in advance if I ask an uninformed question here. The inventory for you guys, that 212 days, that's internal inventory. I believe, however, your sales, 83% of your sales roughly go through distribution. Maybe you can give us a view in terms of distribution inventory, and did it increase, and if so, to what extent did it favor revenue? Gary, opening up, welcome to the party. This is Gary's first call with us. Welcome to the inventory question. Inventory question. I thought we finished this question. For Gary, it's okay. Okay. Gary, it's okay. When I look at the channel inventories from Q4 to Q1, or I'm sorry, from Q3 to Q4, they basically stabilized. We didn't see a significant increase either in terms of dollars or days in the quarter. Likewise, when we talk about inventory on our balance sheet, and I'll address that as well, you know, there's about a six-month lead time from when we can slow down wafer starts to when you see it on the balance sheet. Likewise, as we're looking out ahead to Q1, we see both inventory in terms of dollars on our balance sheet as well as in the channel stabilizing. Sell-through in the channel remains very good. It should normalize in the second half of the year. Got it. I apologize if I stepped on your toes. No. It's fair to say, so like, in 2019, we deliberately built a 200 days plus inventory because we did see all these opportunity. Now the inventory goes this high because go over 200 days again, and that is because the customer's demand start to pushing out. This is on the high side, and we will, so like we'll work cautiously and reduce it. It's not the same as the 2019. Got it. Thank you for that. I wanted to ask about contributors to the revenue growth for the fiscal year, for the quarter. 48.5% is quite commendable. I was hoping maybe you can deconstruct that between ASP increases and unit increases and how you see that playing out for fiscal year 2023 as well. It's very diverse to growth with a little more aggressive, like, activities in a consumer segment. This is different from 2022 or 2021. Everything's the same. Because it's not a one-trick pony, and like not a two-trick pony either. Like, I mean, we have a multiple product. We have a product like a 5,000-6,000 different products. We have a few thousands of customers, large customers, less than. Biggest customer is less than 4% in a different industry. With our, that's the same way as we do in the last 10-12 years. We still continue the path. Clearly, as you look at a business driver in 2022, and as we look ahead, you can also see the impact of selling higher value technologies and higher ASPs that go along with it. While many companies use this supply-demand imbalance as an opportunity to raise prices to their customers, we only had one single-digit price increase back in February, and all of the other is representative of higher ASPs and volume gains. Well put. Thank you guys. Our next question is from Ross Seymore of Deutsche Bank. Ross, your line is now open. Hi, guys. Can you hear me? Yes. It's fine. Perfect. Well, first, I also wanna welcome Gary to the call and thank him so much for being the one asking the inventory question. We still remember that. I knew you would. I'd just one question, one follow-up. The question on the near term first was, you talked a little bit about stabilization in your orders, but said they're still below normal. Any color on that? Then folding another near-term follow-on is the first quarter, you said it sounded like storage and computing would be flat, enterprise data would be up a bit. If you're flat overall, what's going down sequentially in the first quarter to get you to that? That's kind of the aggregate first question. When we look at Q1, you know, and obviously we've guided down about 2%, which is sort of consistent with seasonal trends. It's the industrial is likely to come down, and I may have left you with an incorrect impression because enterprise data is likely to go down even though GPU AI will improve. On the plus side, the momentum in automotive continues to be very strong. In the stabilization color, you know, geographically by end market, the order stuff you said? Yeah. We're seeing better activity. I think that we commented both in Q3 and repeated it here, that customers have gotten a lot more near-term focused. You can point to consumer, you can point to China as being areas that it was very observable. Right now we're seeing a lot better activity, but it hasn't necessarily translated into what I'd call a normalized ordering pattern. Got it. Thanks for that. I guess as my longer-term follow-up, a question I get a lot from investors is the really impressive growth you guys did in 2022, up about 50% round numbers. That's about 30% faster than the SIA-defined analog category. That delta is, you know, kind of 2x what you guys historically have done, and some people are concerned that that's just because of insufficient supply of competition and assumed fungibility that you guys are just growing because other people can't. Or some of your competitors had some product issues that they'll soon rectify, those tailwinds could turn into headwinds this year. I know you're not gonna guide for the full year, but are you at all concerned about those two dynamics having kind of overinflated 2022 and turning into headwinds this year? Anyway, okay, tell those not customers, okay. Investors. Our investors are our customer too. They buy our stocks. hey, we don't do is in the pay-to-play the me-too products. Everything is pretty much single source product. Our products are a lot more programmable, a lot more versatile, and like, I mean, our customer can configure those products. Of course, we take advantage of it, okay, in a shortage. Our customers can use our product in a multiple way, okay. A lot of them are software-based. Now, as you know, in the software side, and like, I mean, is a lot more, you know, stickier. We will continue to use our technical strengths and to gain the market shares, okay. Headwinds, okay, for those people believe they don't believe that. Okay, we have a headwind, okay. That's fair, but let our numbers delivered. Okay. Let our past number to show that. Thanks, guys. Our next question is from Rick Schafer of Oppenheimer. Rick, your line is now open. Well, thanks, and I'll add my congratulations, guys. If I could ask my first question, it's kind of a broad question on your module, just your overall module strategy. I mean, say it doubles this year to sort of 10% or so of revenues. Bernie, I'm sure you'll correct me if I'm off base there, but, you know, sort of what's the right contribution long term? I mean, Michael, I mean, eventually, do you want sort of everything to move in that direction toward module? Or is it weighted more to specific end markets? You named a couple of them already. And I'm curious if you can comment on the margin implications as module becomes a bigger contributor. I think in the past, you've said this is a 5x type ASP multiplier, but again, you know, please correct me. I'll give you the numbers. Yeah. Michael will give you the strategic answer. Modules currently are about 5% of our business. Yeah. It is doubled. Yeah. It doubled a year-over-year for the last two years. Yeah. Three years or two years? Three. Three years. Yeah. Yeah. So, it's a significant business now, okay. Eventually, yes, that's what I want to see it. MPS all gonna move into a new type of modules. Power module has a bad connotation, I know that, okay. A lot of companies in a power module business, and those are in the 30% gross margins. I don't know what's the right word to use it. It is a power modules and a plug in place, okay. It's not your old grandpa's, okay, power modules. This is very different. Our margin is above corporate average. Some of the solutions much higher. We sell those all well over $100 stuff. That's kind of I see as a part of a, it's hardware plus service. Customers, the users, they don't need to know how to use the product. You have to have a very deep knowledge how to design a power supply, okay. They should use very simple solutions like what we provide. They don't need the headaches to design a power supply. I think that we're gonna end it up with MPS or without MPS will be that, okay. MPS want to be a leader in that. I'd like to go back to Rick's earlier question. I would say that back in the day, the single biggest ingredient as far as making a decision for design win had to do with lowest cost. I think that what our customers are seeing, particularly in the last three years, is there are other value drivers to consider as far as time to market, how much design resource they wanna be saved from having to do and total cost of ownership. Those are areas that we're able to meet our customers' demand as well, if not better than, any other analog or power provider. Yeah. Might as well to give you examples. We build our own test equipment, semi equipment, test equipment, and all based on MPS power modules. If you buy those kind of power modules, we can sell things that are well over $50. That in a semi equipment market segments, that's a perfect fit for that. These are very high ASP and very much compact than on the current market. Thanks for that color. It actually leads me to my next question. You know, appreciate all the color that, and you guys have certainly discussed with the power module, but just specific to the silicon carbide update, just, you know, it sounds like you'll be sampling this year. Should we expect any material contribution from silicon carbide this year, or are we kind of looking at 2024? Michael, I mean, we've heard different numbers, but what is the addition of, you know, silicon carbide module for traction inverter, et cetera? What does that do to your potential content per vehicle? Our traction inverters and using a silicon carbide, okay, it's not this year, and maybe it's an even if we will see next year. Our silicon carbide devices, okay, we design our own, we develop our own, okay? We pick some market segment that proves our products are reliables first. That's the first step. To answer your questions, and this year, okay, and there's no large number building in our revenue stream yet, okay. We don't expect that, but that's just to prove the technologies now. Thanks, Michael. Thanks, Bernie. Our next question is from William Stein of Truist. William, your line is now open. Great. Thanks for taking my question. Someone beat me to the module question this time, I'll focus in a little bit different direction. In the past, I know a few quarters ago, you talked about a team that you hired to work in the converter area, which is something you're not really that known for, I think this is also another big, you know, ASP and big growth opportunity for Monolithic. Can you talk about your traction in converters so far and what you expect to come in the coming quarters? Yes, we can. I'm glad to you asked that questions. Okay. A couple of days ago, I saw an image and we received from our customers, and we use that, our customers, use our image for the X-ray machines. Much better than the one their prior versions. When is a we sample the other biotech companies and their our product is designed in, we will see the revenues probably the small revenue this year and the next years. This is a slow ramping product, okay, very high barriers. The bottom line is that we have the technologies and we have a know-how to design a very high performance data converter. These are comparable, if it's not betters. We will we'll broaden our the product portfolios, okay, and as we expand our teams. These are take the a lot of efforts and a lot of investment. So far, we build up a pretty good sizable teams. Now you will have see more general product coming out in the next couple of quarters. Thank you, Michael. Appreciate that. Maybe one other, if I can. Something we haven't heard the company speak a whole lot about lately, and that's the e-commerce effort. Any, any update on how your traction is progressing there? E-commerce. Well, okay, I maybe is not as fast as I want to be. I set my expectation too high. Here it is. We launched MPSNow. I mean, actually, I take it back. I think it's not as it's true. It's not as I expect more, there's a lot of resistance. I mean, our modules, a lot of module ramp up. It's from e-commerce. Now, after last year? After maybe 13 or 14 or 15 months ago, we launch MPSNow in a remote technical support. That helped a lot, especially our module site. Help our customers can schedule a meeting online and we can solve their when they log in, we solve their technical issues. That help a lot. I think the most part of the ramp up is from the MPSNow from website. Overall, like all things, it will take time, okay. You are talking about engineer change their behaviors, okay, how do you design the product and how you're purchasing the product. I think next 10, 12 years, okay, even not even, next five to 10 years for the millenniums to design a power supply and they want to do Google search rather than go do the fundamental design. Okay? Like in the past 20 years ago, like in the last 20 years. So these are the products designed for that, okay? For easy plug-in play use and easy to use and can buy from internet. Great. Thank you. Our next question is from Chris Caso of Credit Suisse. Chris, your line is now open. Yes, thank you. Good afternoon, everyone. The question is about where lead times are right now and the degree of product shortages. With your inventory up now, has that helped to bring down lead times and alleviate some of the shortages? If so, you know, has that taken away perhaps some of the incentive for customers to place, you know, orders for product they don't need? What, you know, it's obviously one of the things we worry about as we go through the cycle. Interested in your view on that. Yeah. I'd agree that lead times have been coming down. They were up as long, combined as much as 26 weeks or six months. They're coming down, more slowly than you'd think. I don't know. Obviously, our customers have changed their ordering behavior, and if that could be attributed to the change in lead times or the fact that they have adequate inventory or that they're uncertain about what the next six months, I can't really say which is the driver in their decision. Got it. Okay. As a follow-up, Michael, you mentioned in some earlier remarks, you know, plans to be a little more aggressive on consumer business as you go through the year. I wonder if you could expand on those comments. Is that something just opportunistic this year, something that you see in the market? Is that just a function of the diversity of your business model where, you know, some other business is slow, so you can go find business elsewhere? If you could give us some more color on that, please. I think you made a very good comment. It is opportunistic. Okay. Remember, we how many years ago, Years ago, let's say that, we have more than 50% of our MPS revenues, it's all from consumer. These are fast design cycles and fast revenues, again, you can cycle product and opportunities. When you have the right product, right support, and right price, you can move the needle quickly. Obviously, or in contrary to all the other industrial automotives, cloud computings, again, these are much longer design cycles, they're kind of slowing down one segment to the other or relative. It's not as, clearly, it's not as in the last couple of years. The consumer is our opportunity, okay? We know how to do it, okay? We have the product, and we have the price structures, and again, not as high as all the other segments. We will do that. If I can just follow on that. Does that imply when business improves elsewhere, we've got a better macro and such, you know, some of the product cycles elsewhere, you know, with, you know, maybe higher margin opportunities, develop, that you sort of back away from some of that and come back to, you know, some of the other segments that have driven growth more recently? No. No, it's not. Okay, consumer is always is a diversity, is always our strategies. In the last couple of years, we didn't grow because of capacity constraints, okay? We sacrifice on the consumer side. Got it. Thank you. Okay. Thanks, Chris. Our next question is from Tore Svanberg of Stifel. Tore, your line is now open. Yes, thank you. I just wanted to come back to the data converter business. So you're obviously getting into the kitchen of two 400- pound gorillas here. I think historically it's been very difficult to crack into this market. You talked about the high barriers to entry. Other than the product being high precision, I get that, but, you know, is there anything else about your business model, you know, that will allow MPS to be successful in this market? I think it's a. We don't know what is a business model. It's. I think it's a. I know this size takes time. The market is large. A few competitors, all these you said, these are 800- pounds gorillas. Okay. We are little hyenas going around. We have to run fast, okay? It's just take opportunities, and okay, we present the product, and, again, and our customers, and, they do have eyes on the different suppliers, okay? Especially come from the last couple of years. It's. We have a good hope, but we know this take a while. That's fair. Just lastly, could you give us an update on the timeline for the $3 billion and the $4 billion capacity that you're working on? Yeah. We said in the next couple years and next two years, and we're still on it. We work with our suppliers and, okay, I'm just mentioning the consumer business, okay. One of the reason is we do have obligations and to fill up these facts. We'll be aggressive in getting all these to fill, getting these orders to fill the capacities, okay. You know, that's our game in the past. We repeatedly have done these kind of things in several cycles already. This cycles, I don't see a difference from the last downturns. For the capacity expansions now, we're still intact, and again, we're not, we may slow it down a little and, okay, but we really have obligations the way with our facts. Okay. Great. Thank you again. Our next question is from Quinn Bolton of Needham. Quinn, your line is now open. Great. Thanks for letting me take a quick, or ask a quick follow-up. Bernie, I just wanted to ask your sort of thoughts on gross margin. You guided to 58 at the midpoint. Looks like the street consensus was probably 50 to 100 basis points higher than that through the year. As you look at 2023, do you think March is sort of the bottom, and margins can trend higher into the second half of the year? Is this push and, you know, the ability to be opportunistic in the consumer segment likely to keep margins, you know, flattish in this 58% level through 2023? Yeah. I'd probably look at it as being flattish for the remainder of 2023. And when you look at the, you know, what, what's taking the margin down, and while you're right, we're down 50 basis points, it's not a significant deflation from the rate that we've been at, you know, trending at over the last two years. And it's really because we have the additional manufacturing capacity, lower revenue, and as we look at the next two quarters at least, the sales mix is not as desirable. Understood. Thank you. Our next question is from Ross Seymore of Deutsche Bank. Ross, your line is now open. Again, just a quick follow-up on my side on the margin side as well, and this time on the OpEx side. You guys did a good job on the OpEx. I know you're putting litigation expense up into regular OpEx, which thank you for doing that. Just the trend in OpEx throughout the year of last year grew, you know, maybe half the rate of what revenues did. How do we think about this year? I think as Michael has expressed here between diversifying our supply chain and continuing to invest in R&D capabilities, that we have some very real opportunities for additional investment that would show up in growing our operating expenses. Having said that, though, you know, there is a fair amount of uncertainty as far as what the revenue outlook is, and we wanna be good financial managers as we go through these market conditions. You know, I would expect that it's likely that the operating expenses won't grow much more than 50%, 60% of revenue growth in the current year. Having said that, again, having said that, you in the past years years now we're reaching $2 billion dollar companies and again, or one point, okay, whatever. $1.8 billion. Yeah, $1.8 billion. Again, our infrastructures hasn't really grown that much. In the last couple years, it's difficult to hire people and again, now we have a lot more breathing rooms, and okay, this is the time to build up a company. Great. I guess for a quick follow-up, I just wanted to revisit one of the questions that was asked. I think it was the very first question or close to the beginning on the storage and computing strength. I know you said notebook was better than you thought and the memory/storage was weaker, and those two kind of go the opposite direction in the first quarter then. Those markets in aggregate have been weak across the board for quite some time. I'm still a little surprised at the strength in the fourth quarter and the stability in the first. What would you attribute that to? Obviously you're getting the orders, but are you guys taking share? Is it the tier one penetration? Is it content? Just any more color on that because it's such a disconnect to the end market in general. I think, I believe we gained some shares. Absolutely. Yeah. We gained some market shares. Great. Thank you. We're a little bit aggressive on that in some low-end market. Yeah. Thank you. If there are any follow-up questions, please click the Raise Hand button. As there are no further questions, I would now like to turn the webinar back over to Bernie. Great. Thank you very much, for joining us for this conference call, we'll be talking again here for the first quarter update, which will likely be in late April. Thank you very much.