Welcome to MACOM's Fourth Fiscal Quarter 2024 Conference Call. This call is being recorded today, Thursday, November 7, 2024. At this time, all participants are on a listen-only mode. I will now turn the call to Mr. Steve Ferranti, MACOM's Vice President of Corporate Development and Investor Relations. Mr. Ferranti, please go ahead. Thank you, Olivia. Good morning, and welcome to our call to discuss MACOM's financial results for the fourth fiscal quarter and full fiscal year of 2024. I would like to remind everyone that our discussion today will contain forward-looking statements, which are subject to certain risks and uncertainties, as defined in the Safe Harbor for Forward-Looking Statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those discussed today. For a more detailed discussion of the risks and uncertainties that could result in those differences, we refer you to MACOM's filings with the SEC. Management statements during this call will also include discussion of certain adjusted non-GAAP financial information. A reconciliation of GAAP to adjusted non-GAAP results is provided in the company's press release and related Form 8-K, which was filed with the SEC today. With that, I'll turn over the call to Stephen Daly, President and CEO of MACOM. Thank you, and good morning. I will begin today's call with a general company update. After that, Jack Kober, our Chief Financial Officer, will review our Q4 and full-year results for fiscal 2024. When Jack is finished, I will provide revenue and earnings guidance for the first quarter of our fiscal 2025, and then we will be happy to take some questions. Revenue for the fourth quarter of fiscal 2024 was $200.7 million, and adjusted EPS was $0.73 per diluted share. For the full year, FY24 revenue was $729.6 million, and EPS was $2.56. We ended our fiscal year with record quarterly revenues and our Q4 free cash flow of just over $57 million. At fiscal year-end, we held approximately $582 million in cash and short-term investments on our balance sheet. Our Q4 book-to-bill ratio was 1.1 to 1, and our turns business, where orders booked and shipped within the quarter, was 22% of our total revenue. Our backlog entering fiscal 2025 is at a record level, inclusive of some of our recent large program awards. New order demand was strongest at our data center and defense customers, while industrial and certain telecom sub-markets remained weak. Given we are at the start of a new fiscal year, I would like to review our long-term strategy, briefly recap some of last year's accomplishments, and then highlight some of our top priorities for fiscal 2025. Simply put, our strategy is to focus on supporting the highest power, highest frequency, and highest data rate applications in our core three markets. We align our R&D and product development resources around these themes, and then, using our annual strategic planning process, establish near and long-term goals to strengthen our portfolio's competitiveness and position the company for future success. Our goal is to have our technical teams work closely with customers and provide unique options for them to consider. By leveraging a wide breadth of unique technologies with world-class manufacturing strength, we believe we can attract many new customers and gain market share. Fiscal year 2024 was a busy year for MACOM, and I would like to highlight four notable accomplishments. First, we are pleased that we were awarded several large purchase orders and contracts by industry-leading customers in each of our three major markets. We expect these program wins will help support our growth over the next 12 months and beyond. Second, we expanded our leadership position in high-performance connectivity solutions for data center customers, and we continue to provide advanced solutions to the leaders in this space. Our full-year fiscal 2024 data center revenue was a record, and we posted greater than 30% data center growth for the year. Third, we continue to execute our strategy to develop industry-leading microwave and millimeter wave frequency processes, products, and solutions. Many of our advanced semiconductor development projects have U.S. government support, as we highlighted in a press release that we issued earlier this week. In total, in recent times, we've been awarded funding of approximately $29 million to develop advanced semiconductor technology. And last, the recent strategic acquisitions have resulted in MACOM being larger, stronger, and more competitive. Expanding our portfolio has increased our serviceable addressable market, or SAM, significantly. While we are pleased with the numerous achievements during the past fiscal year, there are some areas that we recognize we did not meet our targets. First, we fell short of our goal to introduce 50% more IC products year- over- year. More work needs to be done to increase our new product introduction, or NPI, capacity and efficiencies, including expanding automation, streamlining NPI processes, and accelerating fab cycle times. Second, we did not achieve optimal utilization of our low-wafer fab. MACOM's financials are strongest when our internal fabs are fully utilized. We maintain a continuous improvement mindset, and we will certainly be addressing these two important areas in fiscal 2025. As we turn our attention to fiscal 2025, our priorities include extending our leadership in gallium arsenide and GaN MMICs and taking market share in RF and microwave applications, leading the market in 200G per lane high-speed analog solutions for data center applications across copper cable and optical interfaces, further expanding our optical capabilities within the aerospace and defense applications, growing our module and subsystem business in key high-performance applications while leveraging our domestic and international operations, completing the qualification of our European semiconductor center's 6-inch wafer production line before the end of calendar 2025, ramping our high-speed photodetector and CW laser products to support 800G and 1.6T applications, accelerating the pace of new product introductions, which can drive increased fab utilization, and finally, continuing to recruit and attract industry-leading talent to ensure we stay on track with executing our comprehensive strategy. Turning to our end markets, Q4 revenue performance by end market was as expected, with industrial and defense at $92.8 million, telecom at $51.7 million, and data center at $56.2 million. For the quarter, data center was up 14.7% sequentially, and I&D and telecom were both up 2.1% sequentially. I'll note our I&D revenue level was an annual and quarterly record. We continue to identify growth opportunities in the industrial and defense market, spanning radar, electronic warfare, secure communications, and integrated battlefield systems. The trend across all these applications is towards higher frequencies, higher power levels, wider bandwidths, and higher levels of integration. Threats from UAVs, more sophisticated targeting systems, and dramatically more complex electromagnetic environment on the battlefield are driving systems towards higher frequency ranges, including X-band and V-band, to increase system performance. I am pleased to report that earlier this month, MACOM delivered a large S-band high-power GaN-based phased array transmitter to a Navy customer. This was a major milestone for MACOM, and I congratulate our dedicated team on completing this complex project. Our system engineering team was supported by our RF power components team, which resulted in an efficient design and build of this high-performance system. We are pleased that our efforts resulted in a new contract at twice the value to design and build a higher frequency next-generation high-power GaN transmit array. We believe the trends for the I&D market play directly into MACOM's strengths. In particular, we are focused on supporting U.S. and certain international markets with our very high-frequency semiconductor MMIC process technologies and products. For example, the opening of our MACOM European Semiconductor Center expanded our wafer manufacturing capacity, added epitaxial growth expertise, and bolstered our presence with European defense customers. Our telecom end market revenues continue to grow, with some MACOM-specific bright spots emerging. While many expect global 5G spending to decrease modestly in 2025 compared to 2024, we are currently seeing strength due to demand from the North American market. Demand from Europe and India remains weak, although we have seen some large 5G award announcements in India, which may benefit MACOM. We are also receiving new demand on older products as inventory at our lead customers has normalized. But more importantly, we believe that we are gaining market share in new platforms for the 5G markets we participate in. This is mainly driven by the need for higher power multi-band radios, where MACOM's products can offer unique advantages over our competitors. The satellite communications market remains very robust. In particular, the market for Low Earth Orbit, or LEO satellite-based broadband access, provides a significant growth opportunity for MACOM. Satellite-based broadband access is increasingly being a more viable solution for rural areas, broadband service for ships and planes, and emergency services. Some networks are incorporating direct-to-cell capabilities, which MACOM also supports. LEO networks are typically constructed in a mesh architecture involving thousands of satellites. For example, one of the leading satellite-based internet service providers has launched over 6,000 satellites to date, and some believe this number could more than double. We anticipate other large LEO constellations will be designed and deployed over the next few years. I'll note, on the DOD side, new satellite constellations are also being developed to support secure communications, robust GPS, and space-based radar systems. Within these satellite networks, MACOM provides semiconductor and module solutions for satellite-to-satellite links, as well as satellite-to-ground links. These typically use a combination of microwave, millimeter wave radio frequencies, and free space optic communications. In some cases, the satellite-to-ground links require linearization to boost the power efficiency of the link. We also provide solutions for ground-based gateway networks. MACOM is executing on multiple programs today involving our MMICs, RF power, light wave, and linearizer product lines. Finally, the cable TV infrastructure market is in the midst of a transition from DOCSIS 3.1 to DOCSIS 4.0. Demand typically goes through a lull during these transitions as new systems are designed and go through qualification. We have seen that lull in demand over the last one to two years, but during that time, we continue to release new products and work with customers on new design wins. We are now starting to see modest demand on our new DOCSIS 4.0 products as certain U.S. providers begin their rollouts. We supply amplifiers, baluns, couplers, and filters for the line amplifiers and nodes in these deployments. We expect some modest revenue growth in fiscal year 2025 from our cable TV customers. The data center end market continues to be dynamic with significant growth opportunities. We see favorable trends continuing as the internet service providers are accelerating capital expenditures to deploy next-generation data centers. In some cases, new data centers may deploy a large number of processors, which can require increased optical and/or copper interconnects, and we support these areas with our products. We remain agnostic as to whether customers select electrical or optical solutions. In certain applications, our market position is strong, and I'll note that our 800G products are in full production and 1.6T designs are starting to ramp. In fiscal year 2024, we executed shipments to support 800 GB per second optical modules, which in some cases was eight lanes of 100G. We expect certain parts of this market will transition to the 1.6T products, and we are well positioned with key design wins and have started to support customers with these 8x200G solutions. While our products support both retimed and linear architectures, DSP-based technologies require higher power consumption to perform retiming signal processing functions, creating major thermal and cost challenges for customers. To address this, linear pluggable optics, or LPO, and linear copper equalizer technologies keep getting mind share, and we are seeing new customers joining the LPO MSA, which MACOM is a founding member. We expect to see these technologies starting to take some share to support 800G applications. MACOM is also supporting new applications that have disaggregated computing, where pools of processors and memory are interconnected via computing interfaces. The longer-reach PCIe interfaces will operate at higher data rates of 64 and 128 GB per second per lane, or PCIe 6 and 7, respectively, and MACOM can service these links with our linear TIAs, laser drivers, and copper equalizers, as successfully demonstrated at the recent CIOE and ECOC trade shows. One of our areas of growth is related to data center interconnect, or DCI, specifically 400G ZR and ZR+, and the emerging 800G ZR and ZR+ due to rapidly growing demand for more bandwidth that supports cloud computing and content delivery. MACOM's 400G and 800G ZR and ZR+ coherent driver and TIA families are well positioned within the market to support this growing demand. Another area of increasing interest from customers is the use of coherent within the data center campus network, also known as Coherent Lite. MACOM is supporting efforts to enable the use of coherent optics in less than 15-km lengths with low-power, cost-effective drivers and TIAs and CW lasers for 400G ZR Lite and eventually 800G. Deployments of these 400G networks have already begun with volume ramps anticipated in calendar year 2025 and an expectation that 800G will be deployed after that. In summary, the data center market continues to be an exciting area for our high-speed analog designers. Finally, in support of our strategy to strengthen and expand our design capabilities, I'm pleased to announce that this week we completed the acquisition of ENGIN-IC, a small private fabless IC design company with offices located in Dallas, Texas, and San Diego, California. ENGIN-IC has approximately 20 employees who are expert in microwave IC and module design. Since their inception more than 10 years ago, the team has primarily focused on supporting defense applications. The three co-founders, Steve Nelson, Chris Eisen, and Jack Giles, are industry veterans who have helped define what's possible in gallium arsenide and gallium nitride circuit and module design. We are excited to welcome the talented ENGIN-IC team to MACOM, and we look forward to collaborating for the benefit of our mutual customers. ENGIN-IC's wideband amplifier design capabilities and know-how complement MACOM's strengths around narrow-band amplifier design suitable for radar and communication applications. I invite everybody to visit our website and learn more about ENGIN-IC. In summary, our strength is to build a unique, best-in-class, and diversified semiconductor portfolio, which enables MACOM to capture a larger share of the market. Our speed and agility help us address opportunities and ultimately beat competitors that are often larger and have more resources. Jack will now provide a more detailed review of our financial results. Thank you, Steve, and good morning, everyone. Before getting into the details of our quarterly results, I would like to summarize a few items associated with our fiscal year 2024 financials. Fiscal 2024 was a year that included sequential quarterly revenue and EPS increases, with our total revenue increasing more than 12% over fiscal 2023. During fiscal years 2024 and 2023, we have maintained solid and consistent cash flow generation, which has allowed us to fund acquisitions with available cash and to also accumulate cash for future corporate priorities. Now, onto our Q4 quarterly results, as well as some additional commentary on our full fiscal year 2024 and our outlook on fiscal year 2025. Revenue for the fourth fiscal quarter was a quarterly record high of $200.7 million, up 5.4% sequentially based on growth across all three of our end markets. On a geographic basis, revenue from U.S. domestic customers represented approximately 45% of our fiscal Q4 results, consistent with Q3. For fiscal year 2024, revenue from U.S. domestic customers represented 45%, down slightly from 48% in the prior year. We've been working to geographically diversify our business and are pleased to have a healthy mix of U.S. and international-based revenue opportunities. Adjusted gross profit for fiscal Q4 was $116.6 million, or 58.1% of revenue, 60 basis points higher than the third quarter. Total adjusted operating expense for our fourth fiscal quarter was $65.9 million, consisting of research and development expense of $43.9 million and selling general and administrative expense of $22 million. The sequential increase in adjusted operating expense of $2 million was primarily driven by higher compensation-related expenses as we continued to grow the business. Depreciation expense for fiscal Q4 was $7.3 million and $28.1 million for fiscal year 2024, approximately $4.3 million higher on an annual basis, primarily due to investments in acquired equipment. Adjusted operating income in fiscal Q4 was $50.7 million, up 11% sequentially from $45.6 million in fiscal Q3. For fiscal year 2024, adjusted operating income was $175 million compared to $189.6 million for fiscal 2023, resulting in a 520 basis point reduction in adjusted operating margin compared to fiscal 2023. We recognize that initially, some of the incremental revenue from our recent acquisitions has reduced our adjusted operating margin from a year-over-year perspective. However, we note that our adjusted operating income and associated margin have been improving over the past few quarters, as we expected. For fiscal year 2025, our team plans to further optimize our acquisitions, executing on incremental operational efficiencies and yield enhancement activities, and as Steve highlighted, our team operates the entire business with a continuous improvement approach, and we will work to further increase our operating margin over the course of the year. For fiscal Q4, we had adjusted net interest income of $5.3 million compared to net interest income of approximately $4.8 million in Q3. Fiscal year 2024 adjusted net interest income was $19 million compared to income of $10 million in 2023. As we move into fiscal 2025, we expect quarterly net interest income to be consistent with Q4 levels as we increase investment balances through additional quarterly cash flow offset by expected lower interest rates and yields. Our adjusted income tax rate in fiscal Q4 was 3% and resulted in an expense of approximately $1.7 million. Our net cash tax payments were approximately $1.6 million for the fourth quarter and $6 million for fiscal year 2024. We expect our adjusted income tax rate to remain at 3% for fiscal year 2025. As of September 27, 2024, our deferred tax asset balances were $212 million as compared to $218 million at the end of fiscal 2023. We anticipate further utilizing our deferred tax asset balances, including R&D tax credits, through fiscal 2025 and into 2026, helping to keep our cash tax payments relatively low over these periods. Fiscal Q4 adjusted net income increased to $54.2 million compared to $48.9 million in Q3. Adjusted earnings per fully diluted share was $0.73, utilizing a share count of 74.5 million shares compared to $0.66 of adjusted earnings per share in fiscal Q3. Now, moving on to operational balance sheet and cash flow items. Our Q4 accounts receivable balance was $105.7 million, down from $106.8 million in fiscal Q3 due to improved shipment linearity and strong collection activity during the quarter. As a result, days sales outstanding were 48 days compared to 51 days in the prior quarter. Inventories were $194.5 million at quarter end, up sequentially from $190.7 million. Inventory turns were flat sequentially at 1.7 times. The quality and mix of our inventory is strong and continues to support our strategic backlog and our growth plans for fiscal 2025. As we move through fiscal 2025, we expect to see improvements in inventory turns. In addition, this marks the fifth quarter in a row where we have reduced channel inventories held at certain of our partners. Fiscal Q4 cash flow from operations was approximately $62.3 million, up $13.3 million sequentially. Capital expenditures totaled $5.2 million for fiscal Q4, and fiscal 2024 annual CapEx of $22.4 million decreased slightly from $24.7 million in 2023. As we move into fiscal year 2025, we expect our capital expenditures to be approximately $35 million for the full year. Next, moving on to other balance sheet items. Cash, cash equivalents, and short-term investments for the fourth fiscal quarter were $581.9 million, up $60.4 million from Q3. I'm pleased to note that we were able to utilize available cash for our RF business acquisition earlier in the fiscal year. And comparing our cash and short-term investments to the book value of our convertible notes, we are in a net cash position of more than $133 million as of September 27, 2024. Our balance sheet and cash generation remain sound, and we continue to exercise leverage over our operations and discretionary spending to support MACOM's target margins through ongoing cyclical pressure. Fiscal 2024 was a solid year for MACOM, and we are pleased with the company's performance and accomplishments and believe the diverse, resilient portfolio we have built will support future growth of the business. As we begin fiscal 2025, we have established financial goals to continue to build a company that can achieve an annualized revenue run rate of $1 billion or more in fiscal year 2026. Carefully manage and allocate our discretionary spending and capital expenditures to growth areas of the business. Sequentially improve quarterly operating margins and increase EPS. Generate quarterly cash flow from operations that exceeds fiscal year 2024 levels, and ensure our capital structure is optimized to provide operating flexibility at a low cost. In addition, we remain committed to investing in our employees through career development opportunities, annual merit increases, promotions, bonus and equity programs, as well as offering competitive healthcare, retirement, and other benefits. I will now turn the conversation back over to Steve. Thank you, Jack. MACOM expects revenue in fiscal Q1 ending January 3, 2025, to be in the range of $212 million - $218 million. Adjusted gross margin is expected to be in the range of 57%-59%, and adjusted earnings per share is expected to be between $0.75-$0.81, based on 75 million fully diluted shares. We expect sequential revenue growth in all of our end markets. We expect data center will lead with approximately 15% sequential growth, followed by telecom and industrial and defense with low to mid single-digit sequential growth. I'll note that ENGIN-IC will not contribute materially to our Q1 financial performance. I would now like to ask the operator to take any questions. Thank you. Ladies and gentlemen, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, simply press star one one again. In consideration of time, we ask you please limit yourself to one question and one follow-up. Please stand by while we compile the Q&A roster. Our first question is coming from the line of David Williams with The Benchmark Company. Hey, good morning, and congrats on the solid performance here. Thank you. I guess maybe, Steve, you talked a little bit, of course, a lot of nice opportunities in the data center, but I wanted to see maybe first if you could talk about the LPO opportunity you mentioned in the script. And you talked about some of the new technology starting to take share to support 800G. Any more color around that and just where you're seeing that develop? Yeah. On the LPO, what we've seen really over the last four months, maybe six months, is increased interest from the industry. We've seen the growth in the MSA organization from about 10-12 members, now up close to 19 members, and we're starting to see customers begin testing of interoperability of LPO solutions, so we find that very attractive, but we have to also just note that it's very early for deployments of LPO solutions, and we think that over the next one to two years, LPO will definitely begin to take a certain portion of the market, so we are in a very strong position. We've been, as you know, one of the founding members of the MSA. And we've certainly got a very strong design team and product portfolio that supports these types of solutions. And the last point I'll make on LPO is we believe it will intersect the market at 800G data rates. So that seems to be a very good sweet spot for this application. In terms of some of the newer technologies, obviously, as the data rates go higher in frequency, the landscape changes. We feel like we are very well positioned not only on the high-performance silicon side, but also with our optical solutions. And I mentioned in my remarks introducing photodetectors as well as CW lasers. And so we believe that 2025 and 2026 will be good years for these particular product lines. Great. Thanks for the color there. And then, maybe just secondly for me, is: have you noticed any changes maybe on the active copper cable side in terms of deployment, or maybe customers thinking about the different strategies and different ways to deploy there? Or does everything still maybe the same as it was six months ago or even 30 days ago? Thank you. Yeah. I think that it's important to highlight, and we say this often to investors and analysts, that the data center market is very volatile. And our customers are constantly changing solutions, changing architectures, ramping programs up quickly and ramping programs down quickly. And again, we always emphasize that this is one of our most volatile end markets. In terms of your question specifically, I would say that there has been some discussion about, certainly from some large customers, of using less copper cable in certain architectures, let's say. And so we certainly follow that commentary. But from our point of view, our data center revenue is very diversified. So we're supporting not only active optical cables, but also active copper cables and various pluggable modules. And so we don't really get too hung up on any one particular portion of the market and what customers may or may not be deploying because of the diversity within our overall data center portfolio. Remember, our strength has been historically short-reach. As I mentioned in my prepared remarks, you're seeing now even the short-reach and medium-reach becoming more complicated with new protocols, including ZR and coherent light. And so these types of solutions that start to overlay these short and medium-length connections, again, is an opportunity for growth for MACOM. So we don't get too overly excited about any one particular area. We're trying to address all of them and make sure that our customers are successful. Thank you. And our next question coming from the line of Harsh Kumar with Piper Sandler, Your line is now open. Hey, guys. First of all, let me congratulate you guys on some fantastic guidance here. Steve, to that end, I'm seeing the growth pick up materially here for the December guide relative to the last two or three quarters that you've guided to. And I know it's coming from data center, but is it fair for me to think that maybe data centers hit that sustainable level of growth where we could expect these kinds of numbers, maybe not quite 15% sequentially, but good solid growth for the next several quarters, particularly as opportunities like ACC and maybe eventually down the line, LPO come to fruition? Do you grow double digits, for example, sequentially for a couple of quarters in data center? Well, I would temper expectations on continuous double-digit growth. I generally don't believe that would be sustainable. I do think that our fiscal 2025 will be a very strong year for the data center. In fact, I think it may be one of our fastest-growing end markets. And it certainly should deliver double-digit growth for the full year, very strong double-digit growth. But I would never set expectations that things will be linear and constant sequential growth. And for the reasons I stated on the last question, which was about the volatility, the points I made about the volatility are very important to highlight here. It is a volatile market. And as a result, we can see variability on a quarter-by-quarter basis. Now, with that said, I would add one other comment. We are definitely seeing fast movement to 1.6T. And we are seeing some very strong growth opportunities in this area. And so we think that 2025 will be very strong for 1.6T. Behind that, of course, will be more solid performance at 800G as well. So between these two factors, I do believe we could have a very strong year. However, while we may have very strong near-term visibility, I would say as we look to the back half of our fiscal year, obviously that visibility is less clear. Of course. And for my follow-up, maybe I've got a follow-up question or a clarification. So let me ask the clarification first. Jack, you talked about $2 billion in 2026. Did you mean a run rate basis, which is $250 million a quarter, or are you suggesting that you might actually hit a billion dollars for the whole company? And then for my question, Wolfspeed was acquired. That's probably an area that you guys are working on, improving your gross margin. Now we're seeing some RF business come through your way. You're taking share. Do you maybe help us think about when those margins could normalize relative to your core business? Yeah. Thanks, Harsh. And from a clarification standpoint, yes, it was reaching that run rate of $1 billion, which would equate to $250 million in any one particular quarter and not attaining that until sometime in fiscal year 2026. And from a Wolfspeed acquisition perspective, yeah, we're continuing to work through some of the integration items. Things have been going quite well so far. We have been seeing improvements in the business from a top line and a bottom line point of view. And we've touched upon some of the things within our prepared remarks where there's still a bit more work for us to work through there. But overall, we've been quite pleased with what we've seen thus far. Thank you. And our next question coming from the line of Tore Svanberg with Stifel. Your line is now open. Yes, thank you. And congratulations on the strong results. First of all, could you talk about your terms requirement for the December quarter? I think you said 22% terms this last quarter. Just trying to understand if that number will be fairly consistent next quarter. Tore, this is Jack. As we've gone through the past year or so, it's hovered in that 20% range. Some quarters, it'll tick up a little bit higher, and others, it'll go below. But that's kind of where we've been hovering. I don't think there's any expectation that that'll change as we go forward. Very good. And as my follow-up, I had a question for you, Steve. So the market is moving quickly to 200 gig per lane, as you said. And there's sort of a big debate going on between all these various technologies, optical versus copper, linear versus DSP, and so on and so forth. The great thing for you is that you have exposure to everything. So I'm just wondering, from your perspective, and especially in relation to optical versus copper, how do you think the market's going to play out for 200 gig per lane? Yeah. So I'm probably the wrong person to ask that question to. So we are a merchant supplier to the industry, and we engage customers that are really focused on designing the highest performance, lowest cost modules or solutions that they can. All of our customers take a different approach. Some of them are wanting to use traditional DSP-based solutions. Others want to experiment with LPO. Others are moving towards silicon photonics. Some are looking at thin-film lithium niobate. Our philosophy is we will tackle all of those, and we want to leverage our circuit design capability to support our customers where we can provide some value. And I have to emphasize that there are so many unique implementations of these higher data rate solutions, and our team is extremely busy keeping up with the requirements. And at a fundamental level, what we're very good at is high-speed interconnect design. And so whether it's any one of the previously mentioned solutions, our team is able to work with customers and essentially co-design solutions so that they have a high probability of success the first time the solutions are designed. MACOM has the strength to put things into high-volume production very, very quickly. We see that some of the larger industry leaders are really looking at MACOM as a company that has tremendous depth. You're seeing that, and certainly with the 30% growth year- over- year for our data center business, but also the fact that we have leading technology in some areas where vertically integrated, including on the lasers and the photodetector side, which makes our ability to do fast learning cycles and quick deployments of solutions to market very appealing to our customer base. So we don't know which will win the day, but we want to make sure that we're present on both sides of that question. Thank you. Our next question coming from the line of Srini Pajjuri with Raymond James. Your line is now open. Thank you. Good morning, guys. Steve, on the data center business, as you go from 400 to 800 and then from 800 to 1.6, could you speak to how that impacts your, I guess, SAM and also the content? Is it doubling, or is it somewhat less than that? Any color on that, I think, would be helpful. Yeah. So generally speaking, as you go to the higher data rates, the pricing of the individual components is higher. But ultimately, the SAM is defined by the number of connections, number of ports, the deployments of the data centers, and the overall architectures. So it seems, based on the information we're reading, that the SAM is expanding. I would say that, generally speaking, our product solution set is not growing. It is a finite number of functions that we sell into the market. That's why we say, over the long term, the data center market will probably be one of our smaller markets. And I'm now looking out three, five years from now. As we grow other parts of our business, we believe we'll grow faster. So I would say that there is certainly SAM expansion going on within the data center due to the increased number of systems being deployed. But from a product set point of view, it becomes very situational. And I'll use an example. A lot of the systems are using integrated drivers inside the DSP. So that's sort of shrinkage of the SAM in certain applications. However, there's other applications where you can't put the driver inside the DSP. And so those opportunities are growing. So you really have to net all these items out to really get a handle on what is the SAM doing. And we have our own internal models. We don't typically share that level of detail because there's a lot of error in the models. But we do keep an eye on that, and we use that as a bit of a guiding information regarding our long-term strategic plan and where do we want to invest our money in new product development as these higher data rate solutions come to market. Got it. Thank you. And then maybe a follow-up for Jack. Jack, on the gross margin side, sequentially, I think you're guiding for relatively flattish gross margins. Just curious if the expectation is still for hitting that 60% level by the end of, I guess, you said this fiscal year or next calendar year. And in terms of where the improvement might come from, is it primarily going to be mixed-driven? Or I mean, I know you talked about some of the factory loadings being suboptimal. If you could give us some color as to how we should think about gross margins over the next few quarters, that'll be helpful. Thank you. Yeah. Thanks for the question there. With regard to our gross margin guide, I think it's just a function of how we guide with round numbers there in the 57%-59% number that we had put out there. We've been pleased with some of the gross margin improvements that we've seen over the back half of our fiscal year 2024. I think we've talked about a number of different initiatives that we have underway to help improve our gross margins as we work our way through 2025 and into 2026. I think if you look at where we're projecting things as we work our way through the year, I think we're looking to exit 2025 with a 59% gross margin. We're still targeting that 60% number. It's just probably going to be a little bit further out in time as we work through some of the mixed issues that we've referred to. You've obviously picked up on some of the things we were talking about from a fab perspective. I know Steve had touched upon that. But these are critical initiatives for us for fiscal year 2025 to focus on loading our fab, to focus on improving some of our NPI metrics that are out there. Still feel pretty good about the new product introductions, and those products are enhancing our overall gross margin. So that's another area that will help support improving towards that 60% number as we look out a little bit further into the future. Thank you. And our next question coming from the line of Karl Ackerman with BNP Paribas. Your line is now open. Yes, thank you. I wanted to speak on data center optics. Within data center, are you seeing breadth of ACC customers beyond the primary customer? And similarly, active electrical cables are also seeing an expanding opportunity set within the copper domain. So I was hoping you could also speak to the opportunity you see with active electrical cables given the demand for both of those products. Thank you. Thank you. So I would say at the lower data rates, we are seeing interest from the broad market on ACCs. So yes, on that point. And then on the AEC question, so that's not a term that we use internally here. So we think of the market as bifurcated as active optical cables, which we call AOCs, or the electrical side, which is ACC. We know there are some of our competitors that manufacture cables, and they refer to the chips that go in those cables as AECs. And we don't typically view our solutions or categorize them in that way. So we would therefore put that revenue in an ACC bucket. I see. I see. May I speak to another one then? As you think about, Steve, as you think about the trajectory toward 1 billion in annual revenue, I guess if we could narrow on the telecom portion of your market for a second, could you, does most of that growth come from the SATCOM opportunity that you speak to today? Or are you also seeing opportunities within the wireline and wireless where those can become a larger portion of your mix? And as you address that, maybe you could discuss some of the dynamics you have seen within wireline and wireless as you think about the December quarter guide. Thank you. Sure. Just in terms of the December guide, a lot of the near-term strength within the telecom is coming from SATCOM and also 5G deployments primarily here to support radios here in the U.S. But bigger picture, long term, yes, SATCOM has tremendous growth potential for MACOM. As I talked about in my script, we're providing solutions, ground-based solutions, satellite-based solutions, chips all the way up to modules and subsystems, and more and more optical content. And a lot of these LEO constellations are using free space optics to communicate. And we have solutions that can support that application. The wireline is slowly coming back. We would consider both PON and cable as wireline, and we are seeing a little bit of strength, and we expect some growth year- over- year in our CATV business. Our PON business, we think, will be flat to slightly up for the full year. I would say, generally speaking, we haven't seen a lot of catalysts of growth in the PON market, so as we think about 2025, we have sort of a muted expectation, but over the long term, we think we can dominate in the RF and microwave telecom industry, and we are seeing companies sort of drop out. We are seeing consolidation or people exiting certain market segments, and our goal is to pick up that business and roll it into our business, let's say. The other thing I'll add is that one of the ways we're going to win more and more market share is we're going to increase our engineering capacity. And you've seen MACOM do that over the past three to four years. And I'll highlight, of course, the acquisition that we mentioned earlier this week or yesterday. We announced ENGIN-IC, which is a design center or a design company based out of San Diego and Plano, Texas. This opens up two markets where we can now set up new beachheads and start to hire and grow off of the base that we will have in these new regions for MACOM. And this is a team of leading chip and module designers that will bring tremendous IP and experience and knowledge immediately to MACOM, which will help drive our growth. And as we talked about earlier in the script, while we were disappointed with our new product introduction rate, we wanted 50% more. We actually ended up with about 15% more, which is still pretty good growth given everything we had going on this year. However, we do recognize we need more products faster to win market share at a faster rate. And so bringing in resources like ENGIN-IC and the great team there with great ideas and a whole different experience than MACOM has, addressing different parts of the market. For example, they are the industry's leading wideband, high-efficiency amplifier design team. There is no doubt about that. And they have experience using MACOM's semiconductor processes. So they're going to come into the company, hit the ground running, and we should be able to very quickly gain market share. Where they will be expert is in wideband electronic warfare. They are expert at servicing this segment of the industry. And so this is an area that is very interesting to MACOM, and it's also very complementary to our microwave radar-based business. Thank you. And our next question coming from the line of Peter Peng with J.P. Morgan. Your line is now open. Good morning, and thanks for taking my questions. And congratulations on the strong results and guidance. From the December quarter guidance to your annualized run rate of a billion, it's $35 million of quarterly incremental revenues to quarterly. Can you get there if telecom doesn't recover? Is there enough juice in your data center business and defense to get to that number? Or do you think that telecom needs to recover to get to that 1 billion annualized run rate? I think in order to get to that number, we would want to see growth from all of our end markets, for sure. And so that would include telecom. Yes. And just looking at the math, if you apply somewhere between 3% and 5% sequential growth on a quarterly basis, you're at a billion-dollar run rate sometime in Q1 or Q2 of fiscal 2026. So obviously, that's just simple math. Getting there is a lot harder. And we're not suggesting we're going to have 5%-6% sequential growth for the next six quarters. We have to make sure that we continue to launch products that are more competitive than our competition. The markets have to be in a reasonable state so that our customers are spending money on new designs and ramping up their end products. Obviously, there's some tailwinds with defense, tailwinds with data center. We believe we're gaining market share at an increasing rate inside of the 5G universe. And so we feel pretty good about where we're at right now. And then the only thing I would add as a caveat is, as everybody knows, the semiconductor industry is a volatile industry, and it has cycles. And so if the industry is hit with a cycle, a down cycle, then obviously that would be a headwind to our future plans. Got it. And then my follow-up on your data center, if I look at some of your historical trends, it's like up three, four quarters and then down one, two quarters. Given that, including your guidance, we're going to be up three quarters consecutively. Do you see these buying patterns for your customers change? Or do you have enough new products coming in that can potentially offset some of these lumpiness in your data center? Because if you just leave to our own device, we probably just model this up every quarter. So maybe if you can give some color on how you're seeing buying patterns and new products kind of drive this kind of pattern. Yes. And again, I think it's an important question to ask because the data center industry is very volatile. And you're exactly right that you have these periods of growth and then steep declines. And so that has been the history, not only with MACOM's revenue, but the industry's revenue. So I don't expect that to change. So that would be the first thing I would highlight. Now, things that are, so I would probably suggest pull back from the quarterly view and look at the annual growth rates. And MACOM has been growing our data center revenue since our fiscal 2019, where it was about $114 million. And in fiscal 2024, we ended just under $200 million. So in that period of five years, we've doubled the revenue. And with the exception of 2021 and 2022, where the revenues were effectively flat, we've seen growth every other year. And so that's an important point to highlight. The other thing I would highlight is that with the more and more of the next generation data center architectures, that is definitely a bit of a transformational moment for the industry where people need to and want to move to the higher data rates very quickly with very, very large and complex data centers, which have more interconnectivity. And so that is definitely sort of a theme of the last two years. And we would expect that secular growth to continue for at least another couple of years. And so when you add on top of that, the movement to the data rates, the products are getting more complicated, more expensive to deploy, we think we're in a pretty good position. But it is volatile. I would, yes, I would say you should expect at some point in time our data center revenues will go down in some future quarter. That's a given. But we have a long-term view of our business, and we don't. We ignore those dips. Thank you. And our next question coming from the line of Richard Shannon with Craig-Hallum. Your line is now open. Well, good morning, guys. And thanks for taking my question. Steve, maybe I'll ask a question on data center. As we think about fiscal 2025, I wonder if you characterize. I know you won't quantify. But characterize how much contribution we might see from a few different elements. I think most people would love to hear your thoughts on 1.6T. But also, you've also talked about photodetectors and CW lasers and other things here. How much contribution will we see? There will be noticeable material, meaningful? Just any way you can characterize it would be great, please. Yes. So definitely, we believe that our 1.6T solutions will be one of our faster-growing areas for fiscal 2025 on a year-over-year basis. Of course, there still will continue to be solid growth and expansion of our 800-gig base business. On the optical side, we have some very high-end photodetectors that are very interesting to many customers right now. We have good timing, let's say. So it's possible that our photodetector and CW components could have meaningful contribution in our fiscal 2025. I think it's a little early to tell on that right now, but we do have good timing for both those solutions. I'll also highlight that with the 200-gig per lane, obviously, 1.6T is really this migration to the 200-gig per lane. That's, of course, TIAs, linear equalizers, drivers, and the photodetectors. So when we hear 1.6T, we're thinking all of the products we sell that are 200-gig per lane products. And just as general background, I think I mentioned this on last quarter's call, our team is already working and spending significant time and resource on 400-gig per lane solutions as well. Okay. Thanks for that perspective. Very helpful. My follow-on question probably is for Jack here. If I run the numbers on the guide here, it seems like OpEx is going up more than $2 million here. Just, guys, I just want to verify I'm doing the math right here and this kind of a longer-term perspective here. Obviously, your revenues look excellent here for the December quarter guide. And it looks like there's some really good momentum here, wondering if you're opening up this bucket just a little bit more than you have in the recent past. Yeah, I think that's a fair point as we look at this, Richard. Yeah, we have seen a little bit of a step up in our operating expenses. Some of that is with regard to some of those additional design capabilities that Steve was referring to. Obviously, the new acquisition will add $2 million to that operating expense item. But we're also looking to invest in our employees with some of those additional design activities. We also go through a merit process, which hits us here in the December quarter. So there's a culmination of a lot of things that we have going on to support that growth. We do take a hard look at our operating expenses and think we do a pretty good job in terms of being able to manage those expenses as we go through our strategic planning process as well as our budgeting process. We also look at our operating expenses primarily from an R&D point of view and make sure we're allocating those dollars to growth areas of the business. So that will continue as we go forward. Thank you. And our next question coming from the line of Quinn Bolton with Needham & Company, Your line is now open. Hey, Nick Doyle on for Quinn Bolton. Thanks for squeezing me in. Just kind of following up on Karl's ACC question, what application would be using these lower data rates outside rack-to-rack and NIC-to-TOR connections? And would those also be taking share from AOCs? Thanks. Yeah, that's a very specific question. So I'll answer it at a very high level. So we are seeing international interest in our ACC products for various implementations, whether it's top to bottom of a rack or rack-to-rack. Okay. Thank you for that. And then on the DOCSIS 4.0 demand, you're expecting modest CATV revenue growth next year. I understand we've been in a lull and kind of inventory digestion, but is there anything about the technology advancements or supply chain that's kind of pulling in the transition now? Not so much. I think there's been this sort of multi-year design cycle on next-generation DOCSIS platforms. If we look across the various industries that we serve, we would say that the cable infrastructure market probably did some of the most overbuying of a product during the COVID cycle. And so it's been a while for that inventory to burn down. So that's been happening over the past couple of years. All the meanwhile, they've been working on the next-gen systems. So we are starting to grow our backlog for product sets that we know are for new platforms. And we would expect to generate some revenue this year with that business. The other thing I'll highlight is the DOCSIS architecture is a little bit different than the prior architectures. And so in some cases, that's bringing additional product opportunities to MACOM. Thank you. I'm showing no further questions in the queue at this time. I will now turn the call back over to Mr. Daly for any closing remarks. Thank you. In closing, Jack and I would like to thank the entire MACOM team for their continued dedication, which has made our FY24 results possible. We will continue to work as a team to meet our customers' needs and execute our strategy as we start fiscal year '25. Thank you very much. Ladies and gentlemen, this concludes our conference call for today. Thank you for your participation, and you may now disconnect.