Ladies and gentlemen, thank you for standing by, and welcome to the SGH Q2 fiscal 2022 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, please press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, again, press star 1. Thank you. Suzanne Schmidt, you may begin your conference. Thank you, operator. Good afternoon, and thank you for joining us on today's earnings conference call and webcast to discuss SGH's Q2 fiscal 2022 results. Joining me today are Mark Adams, Chief Executive Officer, Jack Pacheco, Chief Operating Officer, and Ken Rizvi, Chief Financial Officer. You can find the accompanying slide presentation and earnings press release for this call on the investor relations section of our website. We encourage you to go to the site throughout the quarter for the most current information on the company, including information on the various financial conferences we will attend. I would also like to remind everyone to read the use of forward-looking statements note that we have included in the earnings press release and the earnings call presentation. Please note that certain of the statements made today may constitute forward-looking statements and that these statements are our present expectations and that actual events or results may differ materially. We also discuss both GAAP and non-GAAP financial measures. Non-GAAP measures should not be considered in isolation from, as a substitute for, or superior to our GAAP results. We encourage you to consider all measures when analyzing our performance. A reconciliation of GAAP to non-GAAP measures is included in today's press release. We will begin the call with CEO Mark Adams, who will provide a business update, and then Ken Rizvi, CFO, will review the financials and forward guidance. After which, we will take questions. Mark? Thank you, Suzanne, and thank you to all who have joined us today. We delivered another strong operating quarter at SGH with total Q2 revenues of $449 million above the midpoint of our guidance range. Non-GAAP gross margins at the high end of our guidance range at 26% and non-GAAP earnings of $0.87 per share, which also came in well above the midpoint of our guidance range. As a reminder, these per share results reflect the 2-for-1 share split that became effective at the beginning of February. In addition, we made progress in the following areas during the quarter. We strengthened our balance sheet with term loan refinancing, increasing our liquidity and extending our overall debt maturities. We announced a $75 million share repurchase authorization today, demonstrating confidence in our business and the growth opportunities that we see over the long term. We continued to improve our corporate governance with the appointment of Penny Herscher as Chair of our Board of Directors. We now have a fully independent Board, except for me and my role as a CEO. Each one of our businesses, Intelligent Platform Solutions, Memory Solutions, and LED Solutions, delivered solid results despite the continuing macroeconomic challenges, including the supply chain constraints facing all companies, the impact of operating in COVID times, and of course, the conflict in Eastern Europe. As many of our peers have also reported, supply chain challenges remain with us, and if anything, have heightened from a few months ago. That said, I am very proud of the operational focus and tireless work of our supply chain teams that set SGH apart, and importantly, place us in a position to drive continued support for our customers, as well as enabling us to deliver strong results for our shareholders. Let me turn to a review of each of our businesses. Starting with Intelligent Platform Solutions Group or IPS, where revenue came in at $82 million for the Q2. As we've stated in the past, the quarterly level of business can vary due to the timing of deployments of various projects, and this was the case in Q2. That said, the business is performing very well with the H1 fiscal 2022 IPS revenue just over $200 million, which is up 33% compared to the H1 of fiscal 2021. An important part of this growth is our investment in services. Q2 services revenue grew by 41% compared with Q2 of the prior fiscal year. Overall, services represented approximately 26% of IPS revenue in Q2. IPS continues to expand customer engagement across the ultra-scale government and oil and gas market segments. Specific to the ultra-scale market, Penguin Computing announced its role in providing both AI-optimized architecture and managed services for Meta's cutting-edge AI supercomputer, called the AI Research SuperCluster, or RSC. In its final build-out expected for mid-2022, the RSC is expected to utilize more than 16,000 NVIDIA GPUs and 1 exabyte of storage, which Meta believes will make it the fastest and largest AI supercomputer in the world. The RSC platform was designed to ensure performance, availability, data integrity, and managed security, all critical elements of an AI-optimized infrastructure. This engagement with Meta has been developed over several years and is a testament to Penguin's ability to address the unique needs of significant high performance and AI compute application environments, highlighting our ability to provide a comprehensive solution of optimized hardware, software, and ongoing services. We also continue to invest in the Edge, a strategic segment of our business where we've experienced success in the telecommunications market as well as the government sector. We will continue to evolve and grow this business as part of our overall IPS strategy. As we think about Q2, component level supply chain constraints are moving a portion of our expected delivery dates out from fiscal Q3 into fiscal Q4, and in certain cases, into our fiscal 2023. As these constraints are industry-wide, this revenue shift is more of a timing issue and not reflective of our customer demand or lost revenue. This will be contemplated as part of our guidance for Q3 that Ken will provide. We also recently announced a new umbrella brand for IPS called Penguin Solutions. Our customers will now identify all aspects of IPS under this single brand name, and we will leverage this new brand to showcase the full breadth of our capabilities. We will continue to use the name Penguin Computing when referring to current HPC products, including servers, storage, and our data center support. We will use the Penguin Edge name to refer to the new edge-related solutions and legacy embedded and wireless products. The new Penguin Solutions brand also reflects the direction we are taking to innovate and scale our offerings, delivering solutions and services that span the continuum of edge to core to cloud. Overall, we see growth in our new business funnel, both in terms of commercial and federal business by expanding existing engagements and focusing on new customer acquisitions. We are expecting a strong second half of fiscal 2022 and continued momentum as we head into 2023. Now turning to LED Solutions. Our LED Solutions Group, which operates under the Cree LED brand, had another strong quarter of operating performance. Revenues were $107 million in Q2, with product revenues up approximately 5% when compared with Q2 fiscal 2021, when this business was still part of Wolfspeed. Year-over-year revenue growth is being driven by customer wins with our high brightness products into the video, architectural, and landscape specialty lighting markets. We continue to execute on our manufacturing transformation plan, which includes the transition from silicon carbide to sapphire wafers, and from a captive manufacturing model to an outsourced capital-light model. We expect this transition to be largely completed by calendar Q4. On the product front, the team is delivering innovative application optimized LEDs, enabling a variety of lighting designs while achieving the best overall system value. We are seeing good traction with our CB94D products in the video display market, as well as new design wins for the horticultural market, indoor sports lighting, and road signage applications, each representing specialty areas of focus where our technology and product offerings differentiate us versus our competitors. It has now been one year since the acquisition of Cree LED, and I continue to be impressed with the team's focus and ability to drive improvements in their product roadmaps, customer engagement, and operational excellence. With Cree LED's long history of innovation and continuously improving technology in the focus of high-powered general lighting, mid-powered general lighting, specialty and video, we believe the LED Solutions Group can deliver continued strong results in the coming year. In our Memory Solutions Group, operating under the Smart Modular brand name, revenues totaled $260 million, which was up 9% compared with the prior quarter and up 19% compared with Q2 of the prior fiscal year. This growth was driven by sales of our core specialty memory offerings such as DDR3, DDR4, and Flash products to our customers in the networking, telecom, and storage end markets. A favorable mix of higher density products, such as our DDIMM product for the high-end server market. While we continue to support our customers with legacy DDR3 and DDR4 based products, we are positioning ourselves to offer next-generation products optimized for DDR5 and next-generation Flash-based, controller-based memory solutions. We are working closely with our key customers in the development of new products for data center and cloud applications, such as NVDIMM/CXL and CXL add-in card solutions. We were recently selected as a validation partner for a CXL E3.S memory module by a major semiconductor company for their next-generation CPU. Another proof point in the investments we are making in advanced memory solutions. For applications at the edge of the network, we are seeing opportunities for specialization in terms of ruggedness, low power, and smaller form factors, all of which play to our strength of high mix, low volume differentiated solutions. Our custom encrypted SATA product in a USB form factor is expected to ramp from fiscal 2023 and expand our flash storage capabilities targeted for network infrastructure equipment and systems. In Brazil, we have completed the transition to our Manaus facility, where we assemble our system-level products, including our new SSD product line, which we expect to ramp by the end of this fiscal year. Our results for the Q2 clearly demonstrate the benefits of our diversification strategy. While we continue to see supply chain constraints similar to other businesses in the electronic supply chain, we continue to meet the expectations of our customers and are optimistic about our ability to not only expand our footprint with existing customers, but also to grow our business with new customers across all three lines of our business. At this time, I'll hand it over to Ken for a more detailed review of the financials and our guidance for next quarter. Ken? Thanks, Mark. I will focus my remarks on non-GAAP results, which are reconciled to GAAP in our earnings release tables. In addition, my commentary reflects the 2-for-1 share split in the form of a dividend that took effect in February 2022. The second fiscal quarter of 2022 is the eighth consecutive quarter of year-over-year growth for SGH, demonstrating how our strategy continues to yield positive results. A year ago, our Q2 sales were just over $300 million, and our non-GAAP gross margin was 19.5%. In the Q2 of 2022, sales came in at $449 million, and non-GAAP gross margin was 26%. We see tremendous opportunities ahead for SGH to deliver advanced technology solutions for our customers across all three of our businesses. Now, let me turn to our detailed results for the second fiscal quarter of 2022. We reported another strong quarter. Net sales were $449 million, a 48% increase year- over- year for the Q2 of fiscal 2021. In addition, non-GAAP gross margin came in at 26% at the high end of our guidance range, and non-GAAP diluted earnings per share was $0.87 for the Q2, above the high end of our guidance range. Our 48% year-over-year SGH revenue growth was helped by the incorporation of Cree LED into SGH. Excluding Cree LED, our revenues grew 13% year- over- year, driven by strength in our Memory Solutions business. For the Q2, IPS had revenues of $82 million. As we have discussed in our previous earnings calls, the IPS business will continue to have quarter-to-quarter variability in revenue and gross margin based on the timing of hardware, services, and software in any given quarter. That being said, the H1 of 2022 for IPS was very strong, with sales over $200 million and a growth of 33% from the same period a year ago. Our LED Solutions Group had revenues of $107 million in the Q2, which was in line with our expectations from last quarter, and product sales were up approximately 5% when compared to the year-ago quarter when this business was still a part of Wolfspeed. Our Memory Solutions Group had revenues of $260 million in the Q2, 19% higher than the Q2 of the previous fiscal year, and was higher both for our Specialty Memory and Brazil businesses. Non-GAAP gross margin for SGH in Q2 was 26%, up from 19.5% in the Q2 of fiscal 2021. Non-GAAP operating expenses for the Q2 were $59.5 million, up approximately from Q2 of 2021. Operating expenses were up primarily due to the inclusion of LED Solutions and continued investments in our Memory Solutions and IPS businesses. In addition, operating expenses benefited in the Q2 of 2022 from $6 million in financial credits in Brazil. This helped offset our Brazil R&D spending, which is required to realize this credit. This credit was set to expire in January of 2022, but the law enabling this credit was extended through 2026. We do, however, expect the benefits from this credit to be reduced going forward, in part due to some of our production moving to our Manaus facility. As a result, we currently anticipate approximately $2 million-$3 million of credits benefiting us in our fiscal Q3. Non-GAAP diluted earnings per share for the Q2 of 2022 was $0.87 per share, up approximately 100% from $0.44 per share in the year ago quarter. Adjusted EBITDA for the Q2 of 2022 was $66 million, or 14.7% of sales, compared to $31 million, or 10.2% of sales in the Q2 of 2021. Our breakdown of net sales by end market for the Q2 of 2022 was as follows. Mobile and PCs was 23%. Network and telecom, 11%. Servers and storage, 15%. AI, data analytics, and machine learning, 12%. Advanced lighting, 24%. Industrial, defense, and other, 15%. Turning to working capital, our net accounts receivable totaled $386 million, compared with $344 million last quarter. Day sales outstanding came in at 45 days, up 6 days from last quarter. Inventory totaled $334 million at the end of the Q2, up from $318 million at the end of the prior quarter. This growth was driven primarily by higher inventory for IPS as we prepare for builds in the H2 of the year. Inventory turns were 8.1 times in the Q2 versus 8.6 times in the prior quarter. Consistent with past practice, accounts receivables, days outstanding, and inventory turnover are calculated on a gross sales and cost of goods sold basis, which were $789 million and $676 million respectively for the Q2. As a reminder, the difference between gross revenue and net sales is related to our logistics services business, which is accounted for on an agent basis, meaning that we only recognize the net profit on logistics services as net sales. During the Q2, we also completed a refinancing to strengthen our balance sheet, extend our debt maturities, and add to our liquidity. The refinancing was completed via a $275 million term loan A facility and a $250 million revolving credit facility, with the net proceeds from the term loan used to retire approximately $160 million of debt, including the seller notes for the Cree LED acquisition and the outstanding amounts under our ABL. Cash and equivalents totaled $366 million at the end of the, compared with $233 million at the end of the prior quarter. Q2 cash flow from operations totaled $32.2 million, compared with $15.1 million in the prior quarter. With the continued global electronic supply chain constraints, more of our capital has been tied up in working capital over the past year. For those of you tracking CapEx and depreciation, CapEx was $7.4 million in the Q2, and depreciation was $10.2 million. Before turning to our guidance, I wanted to discuss the $75 million share repurchase authorization we announced today. This capital allocation decision reflects our strong balance sheet and our expectations for continued cash flow growth. First and foremost, we will continue to invest in our businesses as we see significant opportunities for further organic growth in each of our three business segments. Second, we will continue to review and seek acquisition opportunities for further scale and diversification in a disciplined manner, which we believe can provide strong shareholder returns as we have seen with our most recent acquisition of Cree LED. Finally, the share repurchase authorization provides us flexibility to return capital to our shareholders in an opportunistic and price-sensitive manner, and to utilize the volatility we have seen in the markets and the potential to capture value if there is further divergence between our share price and financial results. Turning to our fiscal Q3 2022 guidance. We expect that net sales for the Q3 of 2022 will range from approximately $435 million to $475 million, up slightly at the midpoint from the Q2 and impacted by some of the supply chain constraints we highlighted earlier. Our GAAP gross margin for the Q3 is expected to be between 23% and 25%. Non-GAAP gross margin for the third is expected to be approximately 24%-26%. Our non-GAAP operating expenses for the Q3 are expected to be in the range of $60 million-$66 million. GAAP diluted earnings per share for the Q3 is expected to be approximately $0.35 ± $0.08. On a non-GAAP basis, excluding share-based compensation expense, intangible asset amortization expense, debt discount, and other adjustments, we expect non-GAAP diluted earnings per share will be approximately $0.75 ± $0.08. Cash capital expenditures for the Q3 are expected to be in the range of $12 million-$16 million. Our GAAP diluted share count for the Q3 is expected to be approximately 57 million shares based on our current stock price. Our non-GAAP diluted share count is expected to be approximately 54 million shares as it includes the benefit of our convertible note capped calls. Our forecast for the third fiscal quarter of 2022 is based on the current environment, which contemplates the current constraints in the global supply chain. Please refer to the non-GAAP financial information section and the reconciliation of GAAP to non-GAAP measures tables in our earnings release for further details. Operator, we are now ready for questions. At this time, I would like to remind everyone, in order to ask a question, please press star followed by 1 on your telephone keypad. Your first question comes from the line of Brian Chin with Stifel. Your line is open. Hi there. Good afternoon. Thanks for letting us ask a few questions. Maybe to kick things off, can you, I guess, provide what your fiscal Q3 revenue guide would have been, were it not for the constraints? Can you also relay sort of which businesses are most affected and what kinds of revenues are impacted all the way out to kind of fiscal 1Q? Sure. Yeah. Thanks for the question. This is Ken. I think similar to other companies in the supply chain, we are impacted by the constraints that folks within the electronic supply chain are seeing. If you look at our business specifically, say we're seeing that within our overall IPS segment, where some of the constraints have pushed out sales as we've talked about into Q3, into Q4, and even into 2023 in certain instances. Now, I just remind you, a lot of the business that we do for IPS is very custom in nature, so it's not a loss in sales, it's just merely a push out into a future quarter. Now, specific to one we've talked about in the past, around some government orders, which totaled about $68 million in size. We announced that several months ago. That specific order, as an example, instead of happening in that Q3 and Q4 time frame, is now more likely to happen in the Q4 and into Q1 time frame. Now, albeit, we still need to lock down some of the components related to that product. That is an example, Brian, of movement that can occur given the constraints we're seeing. Okay. I think also. Got it. Brian, in addition to that, this is Mark. I would add also that that's an example that Ken used. I think we've seen a less dramatic but still noticeable impact across the other businesses, and that's reflected in Ken's guidance. I think the team did a great job and kind of supporting our customers, but you gotta sense the scale of what could have been had we had clear sailing. That being said, I mean, we had a great quarter, a great Q2 if you look at the performance across overall SGH. If you look at the guide for Q3, we're happy given the constraints. We've talked about the backlog overall as we look out into Q4 and even into 2023, looks good. we're very excited about the business and where we are today. Got it. Understood. Just relative to the overall guide in the business, is it right to kinda rank order the segments, maybe some growth highest growth in memory, maybe some growth in LED and then IPS sort of flattish, maybe down a little bit? Is that sort of the right way to think about it sequentially? Sequentially, maybe. Overall growth opportunity, I wouldn't read too much into that trend either because I think our funnel in IPS continues to remain robust, and memory has been a pleasant surprise at the rate it's growing. We thought it was a growth in the kind of mid- to high-single digits. As Ken highlighted, memory was up 19% versus the same quarter of 2021. We continue to find new application wins, designs that in the memory space. The LED business, as we highlighted, is up year- over- year. I think if you're looking about growth rates per se, I think from just a broad market opportunity, IPS is probably the grower at the highest rate in terms of market opportunity, followed by memory, followed by LED. Sure. Okay, that makes a lot of sense. Maybe lastly, just to close out with Ken, just more of a financial model question. The extension of the R&D credit, $6 million benefit in fiscal 2Q. You're talking $2-3 million benefit in fiscal 3Q. Is the right way to think about that then sort of a $3-4 million sequential increase in R&D, or is some of that budget maybe being- Brian, that's the right way to think about that, and that's embedded in our OpEx guidance. Part of the reason that you see that our guide for OpEx is in that $60 million-$66 million range was as a result of lower credit in Brazil for R&D. Yeah. I was gonna ask, Ken, is there another offset you're getting somewhere else in the P&L to sort of counterbalance sort of the increase, sequential increase in the R&D? All of that is embedded in the guidance that we gave, Brian. If you look at Q3, that is factored in. There are some benefits in terms of being able to manufacture in Manaus. That's a free trade zone, so there are some benefits there. Some of that is on the COGS side, but all of that's baked into our overall guide as we look at Q3. Okay, great. Thanks for the help. Thanks, Brian. Your next question comes from the line of Thomas O'Malley with Barclays. Your line is open. Good afternoon, guys. Thanks for taking my question. I just wanted to dive a little bit more into the outperformance in the Memory Solutions Group. You noted on the call you saw a sequential revenue higher for both specialty and Brazil, but could you dive in a little more there about where you saw the strength, as it did come in a bit stronger than you expected? Yeah. Tom, great call-out. If we look at our overall memory business, as Mark highlighted and I highlighted earlier, we saw very strong sequential growth quarter- on- quarter. That growth was in that 19% range, overall. It actually, if I look sequentially for both of the businesses, meaning the Brazil business and the specialty business, both had very strong growth quarter- on- quarter as well. They were in a very similar range if I look at the sequential growth, Q1 to Q2 of this year. Helpful. Then obviously in the environment we're in right now, you have inflation moving higher, consumer discretionary spend may be at risk in certain areas. Could you just talk about how you're handicapping the Brazil business? When you look out, embedded in your model and what you said at the Analyst Day, is there anything different about the way you've thought about that business as a long-term grower? I mean, the Memory Solutions Group, just with the change in the macro, particularly in Brazil. nothing that I would suggest is a radical change. I think as you're aware, we have a brand new product category in Brazil launching by the end of our fiscal year in solid-state drives. We continue to be the largest player in broad memory semiconductor solutions in Brazil. Of course, if macroeconomic winds go sideways from here there could be an impact. we're looking more at kind of just how to grow these solutions and opportunities. That was a lot of the basis for our move to Manaus. we think there's a good growth from here. Sure, if there's a massive demand shock to the system, we'll have to think differently, but we haven't seen significant headwind yet in our business, and we're not anticipating that in the short term. Helpful. Just if I could sneak one more in. I think Brian asked the question, Mark, you talked about the longer term growth rates, but you guys have been helpful giving color in the past on sequential growth rates. Could you just offer any detail on the sequential growth for each of your three businesses into the next quarter? Thank you. Well, I'm gonna let Ken take the actual numbers. I can just comment on it a little bit. As I said, Ken gave an example of some of the supply chain impact on our Q2, Q3 numbers, and that certainly impacts kind of sequential growth rates. My commentary was around the demand piece of that equation. From a upside growth from here, we continue to remain very bullish in IPS, and seeing strong growth in the Memory Solutions piece as well, and just great overall operating performance and gross margin expansion in Cree LED. It's just been a good recipe for outstanding results. I'll let Ken talk about the actual data behind that, but pretty bullish about the business as we see it. Yeah. As we look at our guide, it is a midpoint up a bit from Q2 levels to that $455 range at midpoint. The way to think about that would be the Memory business overall relatively flat, plus or minus a bit versus Q2. If we think about the LED business, it's also relatively flat, and we would expect that IPS business can grow a bit here, Q2 to Q3. Thanks a lot, guys. Your next question comes from the line of Kevin Cassidy with Rosenblatt. Your line is open. Thank you for letting me ask a question, and congratulations on the great results. Just as we're talking about IPS, and Mark, I think you mentioned that the opportunity funnel is growing. Can you compare it to last year? like, is it up, the opportunity is up 20%, 50%, or what's driving that demand? Well, I guess the best index I can give you is what we just completed, and that's just from data. That's just factual that we H1 fiscal 2022 is up, I think it was 33% year-over-year. Again, we continue to see not only new opportunities, but growth in existing customer relationships. Why that's important, because I think I explained, in the past that the transition from a development platform to a production platform is significant in terms of the scale of relationships and the overall size of the business opportunity with our customers. That's gonna be meaningful as we kinda continue to expand this business. As Ken highlighted, we remain very confident in our opportunity to deliver growth. I would say that just some of these supply chain issues are more timing in nature. By the way, we've talked about that in terms of the timing of deployments. we're very happy with the growth in the H1, and we're very bullish about the opportunity in IPS as we head into the H2. Okay, great. Maybe to there's a lot of questions I get from investors about inventory building in the end customers and in the channel. You're showing great growth in your memory business, and especially specialty memory. That's custom, but would any of your customers be building inventory for custom products? Yeah, I think it. We're very careful with that, and I understand the question. It's a really good question. It's probably a good question across all of our businesses, really. It's less of an issue in IPS, given the nature of our agreements and the custom nature of the products developed for that segment. In specialty memory, very similarly, and a lot of times, not all of them, but many cases, we're sole sourced on a product design, not necessarily at the customer, but sole sourced on a specific design. So there's not much double ordering that we're seeing, and we're, kind of working with the customers on this. Quite frankly, I think it's different. This is much different than a memory cycle in the past. This is a broad electronic cycle across the whole supply chain. I think people are more willing to be in longer supply commitments and not have in a lot of our cases, these orders are non-cancellable. I think we're in pretty good shape on the memory side of the house. Of course, LED on the foundry model, outsource, capital light model, we're in pretty good shape there. We continue to watch channel inventories as well. What you're seeing on our balancing, Ken can comment on this as well, is that given our supply side challenges, we're being strategic in trying to position ourselves so we can deliver and continue to grow the business as we have in the past. Yeah. Kevin, on that, when you think about some of the design wins or even the demand specific to the IPS segment, these are large system orders. They can be $2 million, $3 million, $4 million, $5 million, $10 million plus in size. From a supply chain standpoint, we just need to be able to order all of those components and parts that make up that system. That's where we are, as Mark just highlighted, being a bit strategic just to make sure that we can continue to meet the customer demands and the timelines we're committing to our customers. Okay. Thanks for that clarification. Thanks, Kevin. Thanks, Kevin. Your next question comes from the line of Sidney Ho with Deutsche Bank. Your line is open. Thanks for taking my question. Maybe one more question on IPS side. IPS down 30% quarter-over-quarter was a lot lower than we expected. I hear you that you were supply constrained, but what would it be without those constraints? What were in your expectations? I know you talked about IPS probably growing a little bit in the next quarter. How are you thinking about the growth rates for the full year calendar 2022, especially given that some of the, like, the government contracts got pushed out from fiscal Q3, full Q to basically H2 of 2022. What is the right number to think about for the year? Yeah, fair enough. I think a couple of things. Even as we look at Q2 and Q3 there were some pushouts we talked about. what was the specific number? It is in that neighborhood. I would say $15 million-$20 million of movement. That move from Q2 into Q3, reality is some of that, just because of the constraints, can move into Q4. I highlighted one example of that, where it's a large order that has pushed out, not because of anything except for being able to get all of the components together for that complete system. I mean, that's the reality that we're in. We gotta call it how it is. as we've talked about that IPS business, good demand, good backlog as we look out into back into Q4 and even into the beginning of next year. Hopefully, the supply chain will ease a bit, and we'll be able to fulfill those demand trends. Okay. Maybe my follow-up question is on the gross margin side. I know you don't give out the gross margin by segment anymore, but can you give us some qualitative comments as to how gross margin by segment has done in the quarter on a sequential basis? If you put that mix of software services aside, which business is seeing the most impact from higher logistics costs or input costs, and are you able to offset that with any kind of price increases? You're correct. We do not provide the gross margin specifics quarter- to- quarter. But if I looked kinda Q1 to Q2, I would say memory did come down a little bit in terms of the margins. IPS was flat to up a bit, and LED was pretty flat quarter- to- quarter overall for the margins. But we don't provide the specifics in terms of an actual gross margin%. And sorry, the second part of that question? Yeah. It's more about which business is impacted most from whether higher logistics costs or higher input costs, and are you able to offset that with any kind of price increases? Yeah. On some of the products, actually, we don't bear those costs in terms of the logistics, so those are pass-through costs, essentially. All of that, when we think about our guidance, we have baked that into Q3 in terms of our overall guidance, both on the margin side and on the COGS side to get to our gross margin. Those have been baked into our outlook here for Q3. Okay. Thank you. Your next question comes from the line of Rajvindra Gill with Needham & Company. Your line is open. Yeah. Thank you, and congrats on the recent momentum. A question on the gross margin on the guidance. Can you mention the guide is 25%. If I look at the incremental revenue, it's about $6 million, and then it implies that the gross profit will be down about $3 million, despite the fact that revenue's going up by about $6 million. Since I know you mentioned kinda lumpiness in IPS in terms with respect to the software service component, but I wonder if you could kind of give some clarity on kind of the mix effect that you're seeing in the gross margin in the May quarter. Yeah. No, no problem. Good question. If we look at the margins from Q2 to Q3, there's a couple of factors. One, I would say there is some margin impact on the memory side, albeit very small. Then even within IPS, you've already highlighted it, and we talked about it before. Even within the LED business, there's some geographic mix, so depending on where our sales are geographically throughout the world, there can be some mixed benefits or headwinds. This quarter in Q3, based on the geographic mix, there will be a little bit of a headwind, and that gets us to that 25% ±1 point on margins. Great. That's helpful. When we're looking you talked about expectation for a strong fiscal, particularly around the IPS business. You talked about $15 million-$20 million worth of kinda sales that were being pushed into the Q2 and into the Q3 and beyond, and you kinda left it a little bit vague, saying it could get even pushed into the next fiscal year. I guess my question is how confident are you in terms of securing a certain amount of components in order to meet this demand and this funnel, particularly around these kinda large government orders? Kinda maybe if you could provide a little more detail on where the constraints are with respect to your position, and what specific components are you seeing the most acute constraints? I won't give you specific components, but I would say some of these are around the semiconductor supply chain. I won't name names, but I think you've seen it through others in the electronics industries where there are some shortages of specific semiconductor chipsets. That along with even things like power cords and the like that have impacted when we can ship out these large systems. We're talking about small components in the scheme of an overall system, but those still have an impact when you're looking to ship out these large scale systems overall. The only other comment I would add is that some of this is also just due to the sequential nature of a deployment. If something moves from Q3 into Q4, that might be the beginning of a push to the next quarter, only because we're deploying a system that has to get validated until we go add incremental capacity or technology beyond that. These deployments are not just necessarily within a quarter or a one-time event. The growth of potentially adding capacity to a system might lead a Q3 push into Q4, impacting a Q4 ship. By the way, I just wanna make sure everyone understands. A, all of this was contemplated in Ken's guidance, and B, the business continues to be robust. We're not able to call Q4 yet as we are still working on getting the components lined up for finishing our fiscal year. But the commentary you're hearing is pretty bullish. We're just being transparent about the supply chain challenges, and we're also being transparent that the demand side looks pretty good. Got it. Great. Thank you. There are no further questions. I'll turn the call back to Mark Adams for closing remarks. Thank you, operator, and thanks to all of you for your continued interest and support. When I started less than two years ago, we committed to delivering on our growth and diversification strategy by focusing on operational excellence. Our top line continues to grow, and we've expanded gross margins from less than 20% in fiscal year 2020 to the mid-20% range today, up some 600-700 basis points, all of which allows us to deliver strong earnings per share results to our shareholders. In addition, we are delivering on our goal to operate as a best-in-class company from an ESG perspective. Last fall, we delivered our first-ever ESG report, highlighting our performance to date and future goals. We've also made great strides in the area of corporate governance, including shifting to an independent board of directors and the naming of Penny as our Chair. Our commitment to our shareholders is to make continuous progress and operate SGH as a best-in-class public company. We appreciate all of you for joining today's call. This concludes today's conference call. Thank you for joining. You may now disconnect.