Good day, and thank you for joining Navitas Semiconductor second quarter 2023 earnings call. I'd like to turn the call over to Stephen Oliver. You may begin, sir. Good afternoon, everyone. I'm Stephen Oliver, Vice President of Corporate Marketing and Investor Relations. Thank you for joining Navitas Semiconductor's second quarter 2023 results conference call. I'm joined today by Gene Sheridan, our Chairman, President, CEO, and Co-founder, and Ron Shelton, our CFO and Treasurer. A replay of this webcast will be available on our website approximately one hour following this conference call, and the recorded webcast will be available for approximately 30 days following the call. Additional information related to our business is also posted on the investor relations section of our website. Our earnings release includes non-GAAP financial measures. Reconciliations of these non-GAAP financial measures with the most directly comparable GAAP measures are included in our second quarter earnings release, and also posted on our website in the investor relations section. In this conference call, we will make forward-looking statements about future events or about the future financial performance of Navitas, including acquisitions. You can identify these statements by words like, "We expect," or, "We believe," or similar terms. We wish to caution you that such forward-looking statements are subject to risks and uncertainties that could cause actual events or results to differ materially from expectations expressed in our forward-looking statements. Important factors that can affect Navitas business, including factors that could cause actual results to differ from our forward-looking statements, are described in our earnings release. Please also refer to the Risk Factors sections in our most recent Form 10-K and Form 10-Q. Our estimates or other forward-looking statements may change, and Navitas assumes no obligation to update forward-looking statements to reflect actual results, changed assumptions, or other events that may occur, except as required by law. Now over to Gene Sheridan, CEO. Thanks a lot, Stephen. In Q2, we saw continued growth in revenues and margins, along with significant customer pipeline progress across all market segments. Q2 revenue increased to $18.1 million, up 110% from the second quarter of 2022, and up 35% sequentially from the first quarter of 2023, with gross margins climbing to 41.5%, up from 41.1% in Q1. Despite continued global softness in the broader consumer market and also some slowdown in the growth of the solar market, given a rise in interest rates, I am very pleased that we are delivering this robust growth across all markets, and in particular, a nice rebound in the mobile market as GaN chargers reach cost parity with silicon chargers, enabling the launch of more mainstream models. With solid shipments in Q2 and continued momentum into Q3, we are excited to announce that as of today, we have shipped a cumulative 100 million GaN devices and over 12 million silicon carbide devices. In our electric vehicle business, we are seeing strong growth, particularly in both onboard chargers and roadside fast chargers. Recently, a consortium of seven global car manufacturers, including GM, BMW, and Stellantis, announced plans to install 30,000 fast chargers across North America. This translates to an additional opportunity of up to $100 million for our silicon carbide business in the next few years. As a reminder, our silicon carbide technology is already used in over 50% of non-Tesla roadside chargers in the U.S. Overall, the opportunity in EV roadside chargers has a market potential of over $600 million per year by 2028. Based on recent developments in the generative AI market, power demands have been doubling every 3.4 months in AI and edge computing, with the latest chips, such as NVIDIA's GH200, consuming up to 1,000 watts just for a single GPU. When considering data centers may utilize many thousands of processors, this translates into a significant opportunity for our GaN power ICs, as silicon-based designs struggle to meet these dramatic increases in the required power, efficiency, and density. We recently announced a 3.2 kilowatt server power supply platform, which delivers an industry-leading 100 watts per cubic inch with over 96% energy efficiency to meet the challenging 80 PLUS Titanium efficiency standard as required by the European Union. This platform is enabling customers to rapidly develop these power supplies with our GaN ICs and has already translated into a doubling of our customer data center pipeline as compared to Q1. In the appliance and industrial segment, we are also seeing a doubling of our customer projects in our pipeline based on the growing need for high-efficiency electrified motor drive applications across home appliances, which includes dishwashers, dryers, refrigerators, washing machines, air conditioners, heat pumps, along with hair care products, and also includes industrial applications which utilize our silicon carbide technology for high efficiency, factory automation, robotics, and HVAC systems. In solar, despite some market softness, we are experiencing a rapid increase in both the GaN and silicon carbide planned adoption into the solar inverters themselves, as well as a dramatic increase in the energy storage attach rates, which have more than doubled in recent years. One installer is reporting over 60% attach rates, adding battery backup to the solar panel installations for residential Californian customers. We anticipate such attach rates will approach 90% in coming years. Given these favorable dynamics, the revenue potential for each customer project has increased over 100% in our pipeline for the solar and energy storage segment. In the mobile market, despite the broader global consumer softness, we are experiencing significant growth, particularly in China and Korea. Major new charger developments by leading smartphone suppliers, including Xiaomi, OPPO, Samsung, and a number of others, are expanding GaN adoption from performance models to mainstream models, translating into a significant increase in both the number of customer projects in our pipeline and the total revenue potential of those projects. Putting it all together, we're happy to announce a total customer pipeline increase from $760 million in Q1 to over $1 billion in Q2, with important growth in both customer projects and revenue potential across all of our target markets. I'm also very pleased with our progress in expanding manufacturing capacity for both gallium nitride and silicon carbide to ensure we can fully capitalize on this fast growth of our customer pipeline. As previously announced, we are in the midst of ramping our silicon carbide capacity by 5x throughout this year and next, as we continue to ship all the silicon carbide devices we can produce. We're on track with our announced $20 million investment for silicon carbide in-house epi, which will start with the first epi reactor installed in Q1 of next year. In aggregate, over the next 3 years, this investment is expected to support epi capacity of $200 million per year in revenue. It will provide appreciable cost reduction and margin expansion. Last year, working closely with our GaN fab partner, TSMC, we are benefiting from a 3x increase in capacity that ensures we have plenty of headroom to support our growth objectives in the next 2 to 3 years. With the benefits of a $92 million follow-on offering in May, we continue to have a very strong balance sheet that can enable additional strategic manufacturing investments to support even higher growth rates in a highly capital-efficient manner. Today, we are also pleased to announce the first Navitas Investor Day to be held at our new global headquarters in Torrance, California, on November 30th. Investors and analysts are invited to participate in a comprehensive agenda that will include our new Electrify Experience Center, that will detail the past, the present, and an exciting vision for the future in the world of electrified power applications. This agenda will also include the announcement of 4 major new GaN or silicon carbide technology platforms, which we believe will transform many of our target markets. We will also provide a detailed review of our customer pipeline, showcase some exciting surprise guest speakers, and provide a high-level view on our 2024 outlook. In summary, I'm very pleased with our accelerating progress across financial results, customer pipeline, market adoption, technology development, and manufacturing capacity expansion. We're excited about the significant opportunities in front of us, which are reflected in our results. Navitas is the only pure-play, next-generation power semiconductor company, and with our vision and our capability to electrify our world, we believe we'll continue to be one of the fastest-growing semiconductor companies in the industry. Now, let me turn it over to our CFO, Ron Shelton, to update on those financial results as well as our guidance. Thank you, Gene. In my comments today, I'll first take you through our second quarter results, and then I'll walk you through our outlook for the third quarter and some of the market dynamics we're seeing. Revenue in the second quarter of 2023 was well above our guidance, growing 110% year-over-year and 35% sequentially to $18.1 million. The beat was driven primarily by strong growth in the mobile market, tempered somewhat by slower growth in the high-end consumer market, attributable to macroeconomic factors. Nevertheless, we had record bookings during the quarter and exited the quarter with record levels of backlog, increasing by more than 50% compared to the first quarter. That's on top of a 50% increase that we experienced in Q1, so we continue to see strong momentum across the business. Before addressing expenses, I'd like to refer you to the GAAP to non-GAAP reconciliations in our press release earlier today. In the rest of my commentary, I'll be referring to the non-GAAP measures. Non-GAAP gross margin in the second quarter increased to 41.5%, from 41.1% in the first quarter of 2023, and compared to 41.6% in the second quarter of 2022. Non-GAAP gross margins in the second quarter were at the higher end of our guidance. Total non-GAAP operating expenses were $17.0 million for the second quarter of 2023, which is slightly lower than the first quarter and below our guidance, as we experienced lower audit-related fees and consumed fewer materials for research and development. As we've mentioned in the past, we continue to invest in our business in a disciplined manner, the results of which you have seen in the second quarter. Our non-GAAP SG&A expense was $7.2 million. non-GAAP R&D was $9.8 million. Putting all of this together, the non-GAAP loss from operations was $9.6 million, compared to a loss from operations of $8.9 million in the second quarter of 2022, as we continue to invest simultaneously across new markets and focus on growth opportunities. Our weighted average basic share count for the second quarter was 165.6 million shares. Turning to the balance sheet, it remains very strong, with high levels of liquidity and continued improvements in working capital. Cash and cash equivalents at quarter-end were $177.7 million. We continued to carry no debt. As part of our successful public offering in the second quarter, we issued 11.5 million shares for net proceeds of $86.5 million. Leveraging those proceeds, we announced the first in a series of strategic manufacturing investments to increase control over our supply chain, reduce costs, expand margins, and enhance our capacity to meet the needs of our growing backlog and pipeline. The first $20 million investment enables a silicon carbide epi facility at our Torrance headquarters. This facility enables epi capacity that can support over $200 million in annual revenue, while making a meaningful contribution to improved gross margins. Accounts receivable were $15.2 million compared to $7.4 million in the prior quarter, reflecting higher sales during the quarter, which was weighted towards the last month of the quarter. Inventory was flat at $18.9 million, and days of inventory improved nicely as we continued to drive inventory levels to more closely align with the business going forward. Over time, we believe our inventory levels will trend towards our long-term target for inventory turns of better than 3 times. Moving on to guidance. For the third quarter, we currently expect revenues of $21 million ±2%. At the midpoint, this represents substantial year-over-year growth of approximately 105% over the $10.2 million we recorded in the third quarter of 2022, and an expected 16% sequential increase over the second quarter of 2023. Our guidance is based on an increasing supply of silicon carbide products and the expected continued recovery in the mobile market. Throughout the year, we've indicated that our goal was to double revenue this year. Our recent performance adds to our confidence, and we remain comfortable with that guidance. Gross margins for the third quarter are expected to be relatively flat compared to the second quarter, given the upside in the mobile business, which will also translate into a moderation in our gross margin expansion in the short term. In total, our non-GAAP operating expenses in the third quarter are expected to be approximately $18.5 million-$19.5 million, and this excludes stock-based compensation and amortization of intangible assets. We will continue investing in growth, but expenses will generally decline as a percentage of revenue as we continue to scale. For the third quarter of 2023, we expect our weighted average basic share count to be approximately 175 million shares. In closing, we're extremely pleased with the results for the quarter and our near-term and long-term outlook. We saw strength in the mobile market, where we are the leading supplier of GaN ICs. We ended the quarter with record backlog. Our customer pipeline has grown to an unprecedented level, and we ended the quarter with nearly $180 million of cash and no debt. Operator, let's begin the Q&A session. Thank you. At this time, I'd like to remind everyone that in order to ask a question, press star, then the number one on your telephone keypad. Please limit yourselves to one question and one follow-up. Thank you. Your first question comes from the line of Quinn Bolton from Needham & Company. Your line is open. Hey, guys, congratulations on the very strong revenue growth. I, I hate to focus on, on a negative, but, but gross margin, sounds mostly due to mix, but coming in perhaps a little bit, lower than you thought previously. Can you just give a just spend a minute just, just sort of talking about how you see the mix between mobile, consumer, data center, and some of the higher-margin, silicon carbide markets as you look into the second half? You know, Ron, when do you think you might be able to get margins into the, you know, kind of mid-40 range, which I think was your prior target by year-end of 2023? Yeah. Hey, Quinn, thanks for the question. You know, fundamentally, the business is very strong right now, and we talked about pipeline. It's over $1 billion, and backlog was up more than 50%. The good news is, I think, mobile market's strong. It seems to be recovering. We have a great position in it. The other end markets, in terms of pipeline revenue and backlog, continue to grow. What we've indicated in our comments is just based on mix. We see a little bit of a moderation in the growth of gross margins, but we seem to be-- not seem to be, we are executing in all areas to drive margins. When we talked earlier this year about what would drive margins, talked about a transition to Gen-4, that's happening right now. We talked about diversifying end markets. If you look at our pipeline, it's not only growing, but that's happening, and those generally have higher margins. Then costs. You know, we're driving costs. We talked about strategic manufacturing, we're putting in place. The first step is the epi facility. We're executing in all those areas. I think it's just a bit of a, not even a pause, I think it's just a moderation in terms of how quickly margins would grow and, you know, we'll be back on track. I would look at it, and I think we look at it as maybe a 2 quarter slowdown in terms of the rate of growth and margins, but there's no fundamental shift here in terms of our margin profile. ... Hey, Ron, maybe a, a sort of a follow-up on that question. Is, is the sort of gross margin sort of pause really just driven by stronger than expected growth or stronger than expected recovery in the mobile charger market, which I know is the, the lower margin part of your GaN business, or and I guess a perhaps slowdown in, in the higher end consumer appliance market, which I think you referenced on the call. Or is the, the gross margin pause, you know, I guess, are you seeing any, you know, pause or or not slowdown, but maybe just the delay in the silicon carbide side of the business that, that's accounting for the mix? Is the margin really affect that, that the mobile charger market's coming back perhaps stronger than you thought earlier in the year, and that mix shift just to mobile charger is really what's, what's behind the, the, you know, kind of the flattening in the third quarter? Yeah, it's nothing more than that, right? This is really a product mix issue. It says nothing about the strength in silicon carbide. Again, I think it's, you know, silicon carbide is the kind of business, where supply is catching up, but we're still having, you know, we're a little bit supply challenged, and we, we, you know, we ship everything we can make right now. It's, it's a bit of a mix issue. Again, I, I, I suppose I wouldn't characterize it as a pause. I mean, I think it's just a slowdown in, in the rate of growth in gross margins, and the expansion of margins. Like I said, I think it's a, a couple quarters, slowdown and, or moderation, but there's nothing we're doing from an execution standpoint. I think we're doing everything we, you know, we should be doing to drive margin expansion going forward. Maybe if I could just slip in one quick one just on the data center business. You announced the new 3.2 kilowatt platform. Is that data center business now starting to ramp to production here in the second half of 2023? Are you starting to see revenues from the data center power supply market this year? Yeah, we actually the revenues start in Q4. Most of that ramp is next year. We're just releasing the high-power GaN ICs targeted for data centers to production later this quarter, and then the customer revenues start next quarter. Perfect. Okay. Thank you very much. Thank you. Thank you. Your next question comes from the line of Ross Seymore from Deutsche Bank. Your line is open. Hi, guys. This is Melissa Weathers on for Ross Seymore. Thanks for letting us ask a question. Could you give us a high-level summary on where you believe industry inventory levels are today by end market, and maybe particularly in the appliances and industrial end market? How, how do you guys see that inventory situation impacting your pace of market share gains and penetration of new markets, in, like, the medium term? Sure. Thanks, Melissa. Yeah, the industry levels from our view are pretty much in line with what we would expect in the channel. We don't report specific channel inventory, but we did see certainly a buildup in the mobile and consumer space last year. As reported in Q1, we saw an unexpected upside in mobile we couldn't actually deliver, which reflected a lot of those inventory levels being depleted, and now we're shipping in part from inventory and in part from brand new builds. I'd just highlight that particular market, where we've seen a nice reduction in channel inventory, a nice pickup in demand. I think from the broader markets, we see things pretty balanced and reasonable. If anything, as, as Ron highlighted, silicon carbide, we're shipping everything we can build, so we have pretty limited inventory, both, at Navitas and in the channel. Okay, great. Kind of building off of that. For your September quarter guide, you guided to mid-teens sequential revenue growth. Can you talk about what you're expecting by end market and how much of that should be driven by the mobile kind of refill or recovery there versus your other end markets? Yeah, it's pretty broad-based, actually. Certainly, the mobile growth continues into Q3. That's seasonally a pretty strong quarter. We see that even into Q4. We really see good stability and growth in the other markets, the one exception being data center, where we're not shipping yet, but as we commented earlier, those data center shipments start in Q4 and then grow strongly throughout next year. Great. Thank you so much. Thank you, Melissa. Thank you. Your next question comes from the line of Kevin Cassidy from Rosenblatt. Your line is open. Yeah. Thank you. Thanks for taking my question, and congratulations. Great quarter, great outlook. Well, I wonder if you could give us a little more details around the industrial, and even appliance market, the white goods, if that's just starting to ramp and, you know, where, what areas, what geographies are they ramping in? If you can give us an idea of the average dollar content you would have. Yeah, great questions, Kevin. Thanks for that. It's pretty broad-based. I listed a number of the applications from the home appliances, washers, dryers, refrigerators, air conditioners, HVAC. We're particularly excited about fuel pumps, which are fundamentally moving from fossil fuels to more electrified electricity and clean energy semiconductors, like gallium nitride or silicon carbide. As you look at the industrial segment, that tends to be more about automation, HVAC using silicon carbide technology. Very broad base across both gallium nitride and silicon carbide, across lots of different applications and even regions. We've talked about it before. Europe is really the starting point for us. There's a big focus and a big strength in Europe in these segments, we're now seeing that picking up into more customer projects... and revenue opportunities across Asia and across US. We highlighted the fact that the number of customer projects has more than doubled just in a quarter. Most of those are ramping. Some are ramping in 2024, many more are ramping in 2025, so it's not the fastest-growing segment, but brings great stability and certainly a lot of growth and conversion from silicon to gallium nitride or silicon carbide over the next couple of years. Okay, great. Great. Thanks for all the details. On the gallium nitride Gen-4, can you say, is that tracking as expected, and which end markets do you think will adopt it the fastest? Yeah. No, great question. Generation Four is our next major platform. We launched it late last year. This year is expected to be a big transition from Generation Three to Gen Four, and that's exactly what's happening. It's actually being adopted by all of our gallium nitride markets. Even customers in production are switching over from Gen Three to Gen Four, getting performance advantages, cost reductions, and margin enhancement for us. All of the high-power GaN chips that I mentioned that we're launching into data center, solar, EV, and other markets, are also launching directly into Gen Four. We actually expect virtually all of our shipments will have transitioned to Gen Four by the end of the year or Q1 at the latest. Great. Sounds good. Thank you. Thank you, Kevin. Thank you. Your next question comes from the line of Blake Friedman from Bank of America. Your line is open. Hi, thanks for taking my question. I just wanna focus on the mobile market. You've highlighted, you know, strong traction with OEMs in Korea and China. I was just hoping anything you can comment on, developments or relationship, relationships with North American OEMs would be helpful. Yeah, you bet. Thanks, thanks, Blake. We're seeing pretty broad-based adoption. We highlighted the fact that this year, and we've predicted this for the last couple of years, this is a big year for gallium nitride to achieve system cost parity with silicon-based power systems. That's true for many of the charger markets, and it's true of many of the others. In particular, what we're seeing is a transition from the high-end flagship or performance-based mobile charger models to more mainstream models. In particular, we highlighted China and Korea with companies like Xiaomi, OPPO, and Samsung, because these are a few that we can publicly talk about. That's not to say we aren't seeing similar transitions and successes in North America and around the world. In some cases some customers are more sensitive to disclosing, those public names, so we tend to shy away from them. It is broader based than we spoke about, and announced for the reasons I described, and we're also looking for a lot more details on the customer profile, the specific products, and the major product launches, at our Investor Day in late November. More details will be coming. Great, thanks for that. Just as a quick follow-up, just following the capital raise that occurred in this quarter, just curious about your thoughts on cash position? You broke up a bit. Could you repeat the last part? The capital raise? Yeah, I was just curious about thoughts on your cash position following the capital raise and thoughts about raising capital in the future? Cash position. Yeah. Yeah. Hey, Blake, this is Ron. I, I, in a, in a nutshell, we feel really good about the balance sheet and our cash position. I think the equity raise, as we've indicated, was for targeted reasons, strategic manufacturing being one. I think, I think going forward, when you think about us and our capital needs, and planning, what I would say right now is, to the extent we raised capital, going forward, it would be for strategic reasons. You know, we've been active in M&A in the past or, or additional strategic manufacturing, but it would be strategic and accretive. In terms of the business and ongoing operations, we don't see a need right now to raise more capital. Hello, Blake? Blake? Oh, yeah. Thanks. Sorry. Yep, thanks. Yep. Thank you. Your next question comes from the line of Jack Egan from Charter Equity Research. Your line is open. Hey, guys. Thanks for taking the questions. I had a few on silicon carbide. Recently there's been a bit of talk about falling prices for silicon carbide wafers and just more suppliers entering the market. I was curious, what are you guys seeing just in terms of wafer pricing or the broader supply landscape right now? Thanks, Jack. I think in general, silicon carbide supply chains are still reasonably tight. As we mentioned and highlighted, we're shipping everything we can build. We're in the midst of a pretty significant ramp-up with silicon-- with X-FAB. We signed a 500% increase in capacity with X-FAB. That includes materials, so substrates or bare wafers, as you alluded to, as well as the epi wafers, and we're gonna be adding our own in-house epi wafers next year, as Ron described in the call. With all of that said, I do think it's improving. I think we're seeing pockets of improved material availability. I think that's true with the bare wafers or substrates, as we call them, as you said, and I think we're seeing prices start to come down. I wouldn't call it very dramatic at this point, and there are new suppliers coming on board, but quality, yield, the ability to use those for higher performance MOSFETs, all has to be evaluated. I think these things, these things take time, but I think the trends are favorable in terms of getting a more balanced, demand and supply for the industry over the next year or 2. Sure. Okay, that's helpful. On the device side, Your devices can be above 50% gross margin, which is a bit higher than what some of the large device manufacturers are at right now. How much of that is due to Navitas just being fabless and having a lower fixed cost base versus other factors like end market or product mix? It's hard to say. Obviously, we don't have the benefit of knowing cost structures of other suppliers. Many don't break out their detailed silicon carbide business, let alone gross margins and cost structures. I think we feel good about our cost structure. We benefit from our technology being very robust as a trench-assisted planar silicon carbide technology that can mix and match with different substrates, different epi vendors. I think that gives us more flexibility, especially as prices come down, as we talked about on the substrates and maybe on the epi and using our own in-house epi. I think all of that gives us a pretty good cost structure, but I actually think the main reason we might be doing better on margins than others is because the performance of the technology. We have the best high performance in-circuit test results of anybody. We did heavy benchmark testing 1 year ago before we bought GeneSiC. We also have the most robust avalanche-rated, 100% avalanche, tested to the highest values in the industry. We also offer the widest voltage range, from 650 volts to 6,500 volts. In that upper voltage range, there's very, very few competitors that can technically do that, and it allows our customers to use fewer high voltage chips in place of multiple stacked lower voltage chips, making their systems more cost-effective, but also giving us higher gross margins. I think it's more about the performance and capability of that technology that's translating into maybe above average gross margins in the industry. Got it. That makes sense. Thanks so much. Thank you, Jack. Thank you. Your next question comes from the line of Natalia Winkler from Jefferies. Your line is open. Hi, thank you so much for taking my question. Gene, I wanted to ask about the epi, the in-house epi capabilities you guys are going to be investing in. Could you please speak a bit more about, you know, how you view them? Is that going to be a cost improvement? And, and to extent, you know, you have a time horizon that we should think about that, the project, going forward? Yeah, definitely. Thanks, Natalia. It's a $20 million investment over a 3-year period. The first phase is the first epi reactor. It's on order to be received late this year, early next year. We expect it to be fully operational and contributing to revenue by middle of next year. I said the first half of next year. It will both give us incremental capacity that's very important as the market's still tight, but it also will give us incremental cost reduction, which can allow us to be more aggressive on price and drive even more top line, but also put some of that cost reduction into enhanced gross margin throughout next year, which Ron alluded to earlier. I did say 3 years. We expect additional reactors to be involved in years 2 and years 3. We'll be placing those orders as we see the demand and time it to fit that demand profile. We'll continue, even once it's online, to use a blend of outsourced epi as well as insourced epi to maximize kind of the cost and capacity profile. Understood. Thank you. That's very helpful. Then the second question I had was on the data center. Gene, could you please explain how should we think about the GaN and silicon carbide applications in, in data center? It sounds like I think historically, we always thought about GaN kind of being the, the first, you know, to be designed into those markets, but I believe you just mentioned silicon carbide as well. So could you please speak about those, the, you know, the different type of program you have in, in that end market? Yeah, it's a great question. Obviously, it's a very, very dynamic one, with generative AI fundamentally changing the processors that will be used in the future, the power profile, the efficiency demand. It's pretty exciting. It's also the newest because we're not shipping into it yet, but our data center is already bringing out system-level design centers, as we highlighted one of them, the 3.2 kilowatt just announced. That particular one uses all GaN ICs inside, but we do continue to do advanced system R&D work, looking at the combination, actually, of silicon carbide compared to GaN or in combination with GaN. I don't want to pre-announce something, but that's one of the benefits of Navitas as the only pure play next gen power semiconductor guy. We have the world's leading GaN, world's leading silicon carbide. In a very objective way, we can evaluate what's going to be best for the system, depending upon customer priorities around efficiency, density, power delivery, cost, reliability, et cetera. I think there is a potential for silicon carbide to be used in combination with GaN, but we definitely see data center being heavily a GaN IC market, and we expect you'll see that as we announce more products and ramp that revenue starting next quarter. Thank you. Thank you. Again, if you'd like to ask a question, please press star and the number one on your telephone keypad. Your next question comes from the line of John Tanwanteng from CJS Securities. Your line is open. Hi, thanks for taking my question. My first one, just going back to the gross margins. I was wondering, Ron, how should we think of margins exiting 2023 or exiting Q1 of next year, just based on the mix forecast and the adoption of next gen products? You know, when you look further out, with the addition of the epi equipment, is your target margin changing there, and when should we expect that to be incremental to the margin versus if you didn't have that equipment at all? Yeah, good questions. Thanks, John. Getting back to the near term, as we indicated in the comments, you know, we talked about a short-term moderation in the growth of margins. I think that gives you some indication that, you know, we expect them to grow off Q3, just not at the rate of our previous guidance, which was mid-forties. I think over time, you know, again, it looks to us like a couple quarter push out effectively from what we had previously indicated on margin growth. We feel very good about the margin growth. We feel very good about the margin profile. It's just that in the very short term here, we had this, this pause or moderation in our margin growth. With respect to the epi, as Gene said, I'll just echo Gene's comments. You know, part of the benefit of epi is lower cost, but again, I think you know, we don't wanna get that granular. I think the way to look at our margin or our margin profile is a little bit of a pause right now, a little bit of moderation in the growth. Again, nothing's changed in our longer-term thesis. We have an Investor Day, again, at the end of November, and I'm sure we'll touch on it. At that point, we'll give, you know, indications of a longer-term model and where you should expect to see margins go longer term. Okay, great. Gene, just wondering on the pipeline, where, where are the areas that you're seeing the, the quickest conversion from pipeline to orders to, to being able to deliver, you know, whether it's by end market, by, by customer type? Could you just give us a little more color on, you know, where you see the most immediate strength in, in that, in that pipeline you're developing? Yeah, I mean, if you look at the development cycles, those are pretty predictable by market. Of course, mobile consumer converts the fast from an opportunity to a revenue ramp that could be 12 months or less. Data center is the second quickest, 18-month development cycles are common from opportunity creation to shipping and revenue. Renewables tends to be about three years, and EV is four, trending back down to three. You're in that sort of range, 2-3 years, I should say, on renewables. With that said, many of the opportunities in our billion-dollar pipeline are well along in terms of development stage. They're obviously not all at the early stage. We'll see them kicking in throughout this year, next year, even EV, some of those programs are late-stage development programs contributing to short-term growth. Same thing with solar. It's a little hard to characterize when you've got a billion-dollar pipeline that's expanding so quickly across so many different markets and so many different customers. That gives you a little bit of flavor about the, the rough timelines of converting from pipeline early opportunity to actual shipping, and revenue ramping. Great. Just if I could, another one. The increase from Q1 to Q2 in the pipeline opportunity was pretty sizable. Was that mostly from existing customers changing their forecast and maybe adding some new applications, or did you actually add a lot of new customers or applications in there? Yeah, we actually added, in the solar space, let me specifically highlight. Appliance industrial more than doubled the customer projects within that pipeline. Data centers, we more than doubled the number of customer projects within that pipeline. Solar actually saw nearly a doubling of revenue per project, which is an interesting dynamic. While it didn't diversify as fast, we see more people looking to sort of double down or go bigger as they convert from silicon to either GaN or silicon carbide. It varies a little bit by market, but those are, you know, a couple of facts and figures to give you a sense of the, the dynamic. It's certainly broadening, quite dramatically in terms of number of customer projects, while the overall revenue pipeline grew, of course, from 30% to over $1 billion. Great. Thank you so much. Thanks, John. Thank you. Again, if you'd like to ask a question, please press star one on your telephone keypad. The last question comes from the line of Shadi Mitdali from Craig-Hallum. Your line is open. Any question there from Craig-Hallum? Hey, can you hear me? Yep. Yeah, we can. Thank you. Hey. Hey, congrats on the solid quarter. I just got a question on how far from prior highs are GaN gross margins, and do you have any visibility into them if returning near those levels, either through mix or cost declines? Yeah, we don't break out our gross margins by, you know, technology or, or in further granularity, but it's fair to say that gross margins took some hit with the TSMC price increases that we spoke about over the last year, year and a half. First one, it was 20% almost a year and a half ago, another 6%. At the start of this year, we made the strategic choice to continue to drive towards system cost reduction and revenue growth. With that said, we don't anticipate further price increases. We have a lot of cost reductions coming. We highlighted a number of them in our pipeline that Ron went through, including the in-house epi on the silicon carbide side. We're also completing a major transition from Gen-3 to Gen-4, which is very important to driving incremental gross margins to that business, bringing it much closer to the average corporate and ultimately driving towards our long-term model. I think some of that gross margin adjustment or, or, or negative impact is certainly behind us, and we see a pretty attractive path of incremental gross margin improvements on the GaN business going forward. Thanks, fella. That was, that was very helpful. You bet.