Ladies and gentlemen, thank you for standing by. Welcome to the Qualcomm second quarter fiscal 2024 earnings conference call. At this time, all participants are in listen-only mode. Later, we'll conduct a question-and-answer session. If you'd like to ask a question during this time, press star, then the number one on your telephone keypad. To withdraw your question, press star, then the number two. If you're using a speakerphone, please pick up your handset before pressing the numbers. Please limit your questions to one question and one follow-up. Just a reminder, this conference is being recorded May 1st, 2024. The playback number for today's call is 877-660-6853. International callers, please dial 201-612-7415. The playback reservation number is 137-45-532. I would now like to turn the call over to Mauricio Lopez-Hodoyan, Vice President of Investor Relations. Mauricio Lopez-Hodoyan, please go ahead. Thank you, and good afternoon, everyone. Today's call will include prepared remarks by Cristiano Amon and Akash Palkhiwala. In addition, Alex Rogers will join the question-and-answer session. You can access our earnings release and its live presentation that accompany this call on our investor relations website. In addition, this call is being webcast on qualcomm.com, and a replay will be available on our website later today. During the call today, we will use non-GAAP financial measures as defined in Regulation G, and you can find the related reconciliations to GAAP on our website. We will also make forward-looking statements, including projections and estimates of future events, business or industry trends, or business or financial results. Actual events or results could differ materially from those projected in our forward-looking statements. Please refer to our SEC filings, including our most recent 10-K, which contain important factors that could cause actual results to differ materially from the forward-looking statements. Now to comments from Qualcomm's President and Chief Executive Officer, Cristiano Amon. Thank you, Mauricio, and good afternoon, everyone. Thanks for joining us today. In fiscal Q2, we delivered non-GAAP revenues of $9.4 billion. Non-GAAP earnings per share of $2.44 was above the high end of our guidance. Revenues from our chipset business of $8 billion reflect strong premium tier demand for Android smartphones and continued momentum in automotive. Licensing business revenues were $1.3 billion. During the quarter, we also made significant progress on our leading technology and product roadmaps, as well as executing on our growth and diversification opportunities. Let me share some key highlights from the business. As we drive intelligent computing everywhere, we're enabling the ecosystem to develop and commercialize on-device Gen AI applications across smartphones, next-generation PCs, XR devices, vehicles, industrial edge, robotics, networking, and more. To that end, we recently launched the Qualcomm AI Hub, a gateway for developers to enable at-scale commercialization of on-device AI applications. It features a library of approximately 100 pre-optimized AI models for devices powered by Snapdragon and Qualcomm platforms, delivering 4x faster inferencing versus non-optimized models. As AI expands rapidly from the cloud to devices, we are extremely well-positioned to capitalize on this growth opportunity, giving our leadership position at the edge across technologies, including on-device AI. In automotive, the Snapdragon Digital Chassis is the industry's leading technology solution, and we're pleased to announce that our design win pipeline has increased to approximately $45 billion. We're growing faster than the addressable market and remain on track to achieve more than $4 billion of automotive revenues in fiscal 2026. In premium and high-tier smartphones, our Snapdragon mobile platforms continue to set the bar for performance and on-device Gen AI capabilities. Recently launched flagship Android devices, powered by Snapdragon 8 Gen 3, are seeing strong demand globally, especially in China. We are extending the most sought-after 8 series capabilities, including on-device AI, to a broader range of flagship and high-tier smartphones with the new Snapdragon 8s Gen 3 and Snapdragon 7+ Gen 3 mobile platforms, launching in the second half of 2024. In cellular modems, we have again established a new industry benchmark with the Snapdragon X80, the world's most advanced 5G Modem- RF system. The X80 supports 5G Advanced, the next era of 5G, in addition to direct-to-mobile, 3GPP-compliant satellite communications and leading Release 18 features. Additionally, our networking solutions continue to gain traction as the Wi-Fi 7 transition expands to the enterprise. We are excited about the upcoming launches of next-generation Windows AI PCs powered by Snapdragon. The Snapdragon X Elite is the leader in performance on-device AI and power efficiency for the Windows ecosystem and is optimally positioned to lead the transition to true AI PCs. I'm also pleased to share that we recently expanded our compute portfolio with the Snapdragon X Plus platform, which is designed to address a broader range of device tiers. In XR, we're seeing good momentum in augmented and virtual reality. In particular, the Ray-Ban Meta glasses, powered by our Snapdragon AR1 Gen 1 platform, continue to gain traction with consumers. Additionally, the Meta Horizon OS, running on Snapdragon, is now open and available to third-party hardware makers. This is a significant milestone, as it will expand the device ecosystem. Finally, at the Embedded World Conference in Germany, we announced two new solutions for the industrial IoT ecosystem: the Qualcomm QCC730 micropower Wi-Fi SoC, and the Qualcomm RB3 Gen 2 platform. The QCC730 is specifically designed for IoT connectivity in battery power, industrial, commercial, and consumer applications, featuring 88% lower power consumption than previous generations. And the RB3 Gen 2 platform is a complete hardware and software solution designed for a wide range of products, including various types of robots, drones, industrial handheld devices, and more. The RB3 is supported by the recently announced AI Hub and also features support for Qualcomm Linux, a comprehensive package of operating system, software, and developer tools for our IoT platforms. In summary, we're very pleased with the continued progress on our growth and diversification strategy. Beyond handsets, we have established leadership positions across automotive, XR, and networking, and we are well-positioned to do the same in PCs, industrial, and edge AI. We're optimistic about the opportunities ahead for the company, and we'll continue to execute on our plan to deliver long-term growth and value for shareholders. I would now like to turn the call over to Akash. Thank you, Cristiano, and good afternoon, everyone. I'll start with our second fiscal quarter earnings. We are pleased to announce another quarter of strong Non-GAAP results, with revenues of $9.4 billion and EPS of $2.44, which was above the high end of our guidance range. QTL revenues of $1.3 billion and EBT margin of 71% were in line with our expectations. QCT delivered revenues of $8 billion and EBT margin of 29%, which was at the high end of our guidance range, reflecting strength across handset and automotive. QCT handset revenues of $6.2 billion included the benefit of flagship Android smartphone launches, powered by our Snapdragon 8 Gen 3 mobile platform. QCT IoT revenues increased 9% sequentially to $1.2 billion, which was slightly better than our expectations. We had another record quarter in QCT Automotive, with revenues increasing by 35% on a year-over-year basis, reflecting increased content in new vehicle launches with our Snapdragon Digital Chassis products. We returned $1.6 billion to stockholders during the quarter, including $731 million in stock repurchases and $895 million in dividends. During the quarter, we also announced an increase in our quarterly dividends from $0.80 to $0.85 per share, consistent with our commitment to dividend growth. Lastly, the sale of the restraint control system business successfully completes the divestitures of the non-Arriver businesses related to our acquisition of Veoneer. We are very pleased with this acquisition, and the Arriver team is executing on the development of our computer vision and drive policy ADAS software stack, targeting vehicle launches starting in late 2025. Now, turning to guidance. Our forecast for global 3G, 4G, 5G handset units remains unchanged for calendar 2024. We estimate that global handset units will be flat to slightly up on a year-over-year basis. This includes expected growth of high single-digit to low double-digit percentage in 5G handsets. For the third fiscal quarter, we are forecasting revenues of $8.8 billion-$9.6 billion and non-GAAP EPS of $2.15-$2.35. In QTL, we estimate revenues of $1.2 billion-$1.4 billion and EBT margins of 69%-73%, reflecting normal seasonality for handset units. In QCT, we expect revenues of $7.5 billion-$8.1 billion and EBT margins of 25%-27%. Consistent with our previous comments, we anticipate QCT handset revenues to decline by mid-single-digit percentage sequentially, reflecting a seasonal trend due to the absence of flagship handset launches in the quarter. We expect QCT IoT revenues to grow sequentially by low to mid-single-digit percentage as we continue to see a gradual recovery from the macro factors impacting the industry. Following our record performance in the second fiscal quarter, we expect QCT Automotive revenues to grow by low double-digit percentage quarter-over-quarter as the increase in our design win pipeline continues to materialize into revenue. Lastly, we expect non-GAAP operating expenses to be approximately $2.2 billion. In closing, we are pleased with our execution and financial performance for the first half of the fiscal year. Specifically, we saw year-over-year handset revenues from our Chinese OEM increase by greater than 40% in the first half of fiscal 2024, reflecting our strong competitive positioning and recovery of demand. Looking forward, our technology leadership positions us to continue to execute on our diversification strategy across IoT and automotive. In IoT, we look forward to normalization and demand across our customer base exiting fiscal 2024. In addition, we're excited about the launch of our next generation AI PCs, powered by our Snapdragon X Elite and X Plus platforms from all leading PC OEMs, starting in mid-2024. These PCs will deliver industry-leading processor performance, advanced on-device GenAI features, and extended battery life. In automotive, we are pleased that our design win pipeline has increased from $30 billion in September 2022 to approximately $45 billion, providing confidence in executing to our long-term revenue targets. This concludes our prepared remarks. Back to you, Mauricio. Thank you, Akash. Operator, we're now ready for questions. To queue a question, press star then one. To withdraw your question, press star two. If you're using a speakerphone, please pick up your handset before pressing the numbers. One moment please, for the first question from Matt Ramsay with Cowen. Thank you very much. Good afternoon, everybody. Cristiano, I wanted to ask you a question about sort of handset, modem, and RF architecture as we move into sort of the era of AI in handsets and mobile devices, where I think it's likely that the compute system and the memory system of the phone take up more battery life, potentially, as we try to compute some of these applications for AI inference on the device. And I wonder how that changes your potential opportunity for your modem business integrated with your RF business. There was one of your competitors talked about a socket loss last night, and I think it went to you guys. I wonder if you might comment on how or why, but I think it's a bigger picture question as the compute subsystem of the phone puts pressure on the modem and RF, does that give you opportunities for further integration? Thanks. Hello, Matt. Thanks for the question. Well, let me unpack this. I think as far as modem RF, we believe we have a very competitive RF front-end portfolio, and we have been really delivering unique features across the modem RF system, especially on power. As a general comment, not related to AI, but a general comment, I think as you look at AI running on device and AI running on the cloud, modem becomes more important, especially things like latency of response or hybrid AI models has a new importance of real-time connectivity. So we're starting to see more and more the modem becoming more important. The real advantage for Qualcomm is, not only on the modem RF, even though I think we're very proud of having the leadership position there, it's the fact that we actually created the ability to run AI pervasive on devices without compromising battery life. And that has been reflected within our NPU performance, both on phones as well as PCs, so, and cars. And I think that's the key, I think, technology leadership position for AI, which is the best possible performance per watt. Thank you. Our next question is from the line of Samik Chatterjee with JP Morgan. Please proceed with your question. Hi, thanks for the question, and maybe if I can start with Cristiano asking, sort of, you mentioned the strong performance you're seeing in the China market, but maybe any more details in terms of just what you're seeing in the market relative to any specific numbers that you can share? Because there's been a lot of conflicting data points about the market being strong in 1 Q and then maybe taking a breather. So curious to understand what you're seeing on the ground there in terms of the China market. Also, it's always been a sort of a leader in adopting new technology, and seems like the AI phones are doing well. So how much of the recent trend do you attribute to AI-led upgrade cycle versus a normal market rebound? And I have a quick follow-up after that. Thank you. Thank you, Samik. So what moves the market for us is premium and high tier. And I think what we're seeing in the China market is that the mix is improving. As the market has stabilized and returned to some form of normality, what we really liked is that within that market, premium and high tier, as a percentage, continue to increase, and that's actually what's driving the results. And we are seeing the very first, you know, instances of on-device AI and GenAI being launched in premium devices, and that has been resonating well with consumers, so it's a positive trend that we like. The other color I'd like to add is, we have not seen signs of weakness in the Android premium market in China, especially with our OEMs. A lot of the strength really coming from premium devices from Xiaomi, HONOR, OPPO, OnePlus, vivo. I think Huawei entering that market actually increased the overall TAM of premium Android. Okay. Maybe, Samik, to add a couple quick data points on top. As we mentioned in our prepared remarks, first half of fiscal 2024, our revenue from Chinese OEMs grew by greater than 40% year-over-year, and that is also reflected in our third quarter guidance. So it's a trend that's holding up as we look forward. And then from a roadmap perspective, as you look into our new premium tier launches coming up later this year, in addition to GenAI, we'll have our Oryon custom CPU core coming in as well. So we're very excited about the roadmap. Got it. And for my follow-up, maybe, Akash, this is more for you. I mean, when you talked about the seasonality into the June quarter, and if seasonality is sort of the typical seasonality that you see, and the aggregate results or revenue being better than seasonal is really being driven by autos here with the low double-digit growth that you talked about. Clearly very strong sort of pipeline of wins, but how sustainable is this sort of pace of improvement quarter over quarter in terms of revenue? Just want to get a sense if this is when we start to see more sort of inflection in auto revenue, is, given the strong pipeline you have, and that drives better seasonal results going forward, even into the September quarter. Thank you. Yeah. From an automotive perspective, as you know, we've given out a target of greater than $4 billion revenue in fiscal 2026, and what you are seeing is really our design win pipeline materializing into revenue on our way to that number. And so that's the framework as to how I'd think about it. Two key kind of data points on our design win pipeline. So as you'll recall, the last number we had given was $30 billion in September, about 18 months ago, September 2022. The updated number that we just provided is $45 billion of design wins. So obviously a very significant increase. And off-note, within that, approximately one-third is driven by ADAS. So we're seeing a tremendous success now in ADAS, and that's adding to our design win pipeline. Our next question is from Mike Walkley with Canaccord Genuity. Please proceed with your question. Great, thanks. Maybe just, just building off, you know, the 40% increase in shipments to the Chinese OEMs holding, you know, through the June quarter guidance, just based on, you know, your expanding on-device AI portfolio, is this level of demand, you know, sustainable into the back half of the calendar year? Or asked another way, do you, do you expect the smartphone market to have kind of normal seasonal trends after the, the June quarter dip? Yeah. So as you'll recall, Mike, we had said earlier that we expect the third quarter to be the low quarter from a financial perspective, just given the seasonality of our business. That still holds true. So as we go from third to fourth quarter and then into fiscal first quarter, which is the December quarter, we expect growth as new launches of phones happen across all major OEMs. And as I said earlier, we're gonna have the launch of our Snapdragon 8 Gen 4 chip as well, and we're extremely excited about what that chip does and the launches that will come through that chip later in the year. Specifically, as you think about fourth quarter, we expect the EPS growth from third to fourth quarter to be consistent with fiscal 2023, and then we'll grow beyond that into the December quarter. Great. That's very helpful. Maybe just for a quick follow-up on the IoT business, it sounds like March is the bottom as you laid out. Can you maybe update us on the, the three segments, just what you're seeing in terms of the inventory correction? Yeah. So, Mike, we'd talked about December fiscal first quarter as the bottom quarter. We grew from that into March by 9% sequential growth, which was better than our expectations, and then now we're guiding low- to mid-single-digit growth into the September quarter. So it's as we'd outlined at the beginning of the year, we would see improvement through the year, and that trend is holding, and we expect it to hold in the fourth fiscal quarter as well. In terms of different parts within IoT, consumer is more aligned with phones, so we've seen that recover faster. And then, the industrial networking is consistent with what our peers are seeing within those industries, and the recovery timeline is aligned with that. If you kind of step back and think about our business there, we're pretty excited about new products that are coming out. So Cristiano talked about the PC set of products coming out later this year, device launch coming out later this year. But then in addition to that, we also have a new product in industrial and Wi-Fi 7 that will drive growth into this IoT segment as well. Our next question comes from Stacy Rasgon with Bernstein Research. Please go ahead with your questions. Hi, guys. Thanks for taking my questions. For my first question, just on the PC outlook, it does sound like devices are gonna be available for purchase in the back half. So, like, how much PC is actually in the Q3 outlook, and what should we expect for the PC in the numbers, like, into the second half and beyond? Like, when does PC actually get big enough for us to see it? Hey, Stacy, thanks for the question. We have a lot of product momentum right now, and especially with all the launches, I would encourage everybody to go watch the Microsoft Build event, especially on what is happening with on-device AI. There's a lot of product momentum and launches. As those devices start to ramp up in volume, and since a lot of them are gonna be back to school, it's gonna be more of a fiscal 2025, event in terms of being material within the IoT segment. Anything you'd like to add, Akash? Just maybe in our June quarter guidance, there isn't material PC volume forecasted in our numbers. Yeah, one thing we're gonna do. Sorry, just real quick. One thing we're gonna do. Yes. Like we provide an update on auto this quarter, we're gonna provide a more detailed update next quarter on PC, especially as we're gonna have those devices out launched. Got it. That's helpful. And for my follow-up, I wanted to ask about Huawei revenue. So in the queue, it says that you're not expecting any further product revenue from Huawei beyond the end of the calendar year. So I know it's only low-end 4G that's left, but like, how big is that now in the numbers, and how much of that will be going away end of the calendar year? Yeah. So, Stacy, if you look at Huawei, as you've seen, they've launched multiple tiers of 5G devices already with their own chips, and clearly we don't participate in those devices. What we are shipping at this point is the license that we have is for 4G chips, and as you rightly pointed out, it's at the low end of the spectrum. What we outlined in the queue is, since the devices will eventually transition all to 5G, we don't expect any revenue from Huawei product business in 2025. Our next question comes from the line of Chris Caso with Wolfe Research. Please go ahead with your question. Yes, thank you. Good afternoon. Our question is on QTL, and you know, it sounds like that you're starting to see some degree of improvement, you know, particularly among the China OEMs in the QCT business, but that has so thus far hasn't translated to the QTL business. Can you talk about, you know, sort of the lag between the recovery in those segments and, you know, what your level of optimism or not is for, you know, sort of breaking out of this range in the QTL business? Yeah. So as you know, well, QTL business is really driven by the size of the market, and there is a cap on the total ASPs, up to which the royalty rate, the percent royalty rate applies. So as we've seen, the benefit on the QCT side is a lot driven by more units at the premium tier, especially above $400 in price. It's not something that benefits the QTL business directly, the way the royalty program is structured. So that's the disconnect between the two. Got it. That's helpful. As a follow-up, you know, with regard to the AI handsets, you know, a lot of the questions that we receive on this is, you know, sort of why, and you know, what, what are the applications, what are the reasons for a consumer to upgrade their handset to AI? You know, Cristiano, you talked about the developer hub that you're running. You know, perhaps that gives you some insight into, you know, what the developers are doing, you know, what's going on in the pipeline that will drive these AI handset sales. Look, it's, it's a great question, and I, I wanna step back and say, in general, I think, AI is gonna benefit all the devices. I think AI, when it extends to, running on device, besides the benefit of, working alongside the cloud, it has completely new use cases, privacy, security, latency, costs, personalization, et cetera. Here's how you should look into this. In the same way, in the same way that when the smartphone started, you have a handful of apps that eventually grew to thousands and hundreds of thousands of apps, and that was really the user experience. I think we're in the very early stage, and you're starting to see some of those use cases, and you have exactly that moment. Some of the phones have 10 apps, you know, and, and they're growing. One of the reasons we have the AI Hub, because this is a new, I think, moment for the industry. It works a little bit different. It's different than how you think about the traditional app store. You have many models, many in the open source models. They can run on a device, and they can be attached or built into any application. So I think what's starting to see is a lot of developer interest. As we said in the prepared remarks, we have over 100 different models, from models from OpenAI to Llama 3 and many, they are quantized and optimized to the NPU. When they are optimized using the tool, they run 4x faster than the model without optimization. Those models and those use cases started to be implemented in apps, whether it's an image or associated with a camera, it's associated with language. So we're in the beginning of that transition. We really like what we see because it's really creating reason for people to buy a new device. It's gonna be the same on PCs, it's gonna be the same as they come to cars as well, and industrial. So it's an exciting tailwind, I think, for our strategy of actually driving computing and connectivity at the edge. Our next question is from the line of Timothy Arcuri with UBS. Please proceed with your question. Thanks a lot. I wanted to ask about the mix of the business, and, you know, as you said, Akash, China's, you know, holding up quite well. It's up, you know, 40% year-over-year in the fiscal first half. But it's within shouting distance of kind of where it peaked, on a quarterly basis back in fiscal 2022, when they were obviously, you know, overbuilding at that time. So can you talk a little bit about what's happening there? How much of the year-over-year growth is units versus pricing? Yeah. Thanks, Tim. As we said earlier, it's really the biggest benefit we are seeing is the mix being stronger, and as you know, we are strong competitive positioning is stronger at the higher tiers, and so that's helping us. The second is when you look at generation over generation, the chips at, especially at the premium tier, are getting more capable as more, not just GenAI, but other additional capabilities are being integrated into the chips and there's strong competition between the OEMs, so there's demand for those capabilities. So, we're seeing that come through as well, and it's really a combination of those things that is driving strength versus a unit upside. The unit size we are seeing is very much aligned with the market forecast, which says flat market versus last year. I got it. Okay, and then just as a quick follow-up, how sustainable are these RF wins that you've, you know, obviously gotten for this upcoming phone? Should we consider that as kind of part of the modem, so when the modem goes away, the RF wins also go away? So of course, we'll not talk about any specific customer here, but I think I'd go back to the very first question that Cristiano answered. The key thing for us is the modem RF architecture and how when we develop the end-to-end together, it creates an advantage for us in terms of performance, in terms of time to market for our customers as well. And that's a sustainable advantage that will stay going forward for us. Our next question is from the line of Tal Liani with Bank of America. Please proceed with your question. Hi, guys. When I look at your numbers, you beat the numbers mainly on handsets. It's both for QTL and QCT, of course, and I'm trying to understand how much of the outperformance is just China versus the rest of the world. So when you look at the rest of the world, what were the trends when it comes to your QCT shipments and QTL? And then within China, where are we in the recovery cycle, right? There is ongoing growth, but there is, w hat we're seeing now in the first half of the year is mainly recovery from last year. So are you now at normal levels, and from here, it should trend normally based on demand, or are we still recovering from the lull of last year? Thanks. Yeah. So, a couple comments. First is on the overall picture across OEMs. So China saw a very significant benefit, but we had strength across other parts of the Android ecosystem as well. And so, it's not something that was isolated to one or two OEMs. It was a broad trend that is just representative of the overall market and the mix shift that we discussed in the overall market. On your second question, as we think about our strength in handsets, we are very optimistic that as we go forward, this is a trend that holds forward. This is not about inventory. As I said earlier, the units are actually aligned with the size of the market, and the trends are really driven by mix and increased content. Got it. Okay. Second question, just on the AI, I don't know if it's possible to quantify at all, but if you look at the non-AI QCT contribution versus an AI QCT contribution, when AI is included in the mix, is there a number where it comes to the increase in content per phone? Does it mean that the semiconductor there is gonna be more expensive, higher price for you? So even if the market doesn't grow, can you grow just by the market shifting to AI? That's theoretical, but I'm trying to isolate the impact of AI. Thanks. A lot of people are Tal, but let me try to give you maybe an answer that to help explain this. In first step, a lot of the increased content in ASP on QCT chipsets, including premium, has been driven by the compute part, and it's more performance on the compute, CPU, GPU, the NPU. Second, the NPU, it has been the largest area of silicon growth in those chips. So generation over generation, one of the largest improvements has been the NPU for AI, and AI is driving a lot of silicon content in those devices because the expected computational capability to run those models. The benefit financially, I think it's gonna come probably in the way that is, that you're starting to see the beginning of it right now, which improves the mix. Users will wanna buy a more capable phone that can run AI, so drives the market towards a richer mix of higher implement tier, share gains, and then an upgrade cycle as people wanna buy a new phone. That's how we should think about it in phones. PC is a little different. As we enter the PC, I think the AI and the ability to run on-device AI better than any of our peers on a laptop, I think it's gonna be a tailwind to the capability. Car, it builds more value on top of the platforms that are being commercialized and design win with the increase of the pipeline, especially in many of those platforms, we can do a softer upgrade to be able to run GenAI on those vehicles. I think that's how this is gonna materialize for Qualcomm. The last part of my answer is industrial, which is a new area that we're trying to upgrade to higher performance, from microcontrollers to higher performance compute and connectivity. I think edge AI is proving to be a key attribute of this market going forward. Our final question is from the line of CJ Muse with Cantor Fitzgerald. Please proceed with your question. Yeah, good afternoon. Thank you for taking the question. I guess I was hoping you could speak to QCT gross margins. They impressively held flat despite revenues down 5%. And I guess the real question here is not just, you know, how you did it this quarter, but, you know, how should we be thinking about as you bring on non-handset revenues to the model, what incremental gross margins might look like for QCT, particularly as we think about the AI PC and IoT, as well as, you know, auto, given that growing backlog? Yeah, thanks, CJ. Yeah, I think the first couple quarters of this fiscal year, we've definitely seen strength in margin, and it's driven by the richer mix that we've discussed on the call. What we're guiding for the third quarter is a sequential decline, again, reflecting kind of lack of flagship launches in the quarter. No change to what we've said on gross margins before. We've given a range, and we've been operating at the high end of the range, but no kind of fundamental change on the framework of it going forward. Great. As a quick follow-up, on the auto side, you know, you talked about the higher backlog, reiterated the $4 billion+. Should we be thinking about, you know, kinda amortizing that 26%+ growth equally into fiscal 2025, 2026, or might that come in sooner with faster growth into 2025? Yeah. So I mean, obviously, we're not gonna guiding quarters that far out at this point. But, if you kinda take the current run rate and extend it forward towards the $4 billion target, kind of generally a sloping growth increase between the two data points is a reasonable way of thinking about it. Thank you. That concludes today's question-and-answer session. Mr. Amon, do you have anything further to add before adjourning the call? Yes. Just a few comments. I think we're incredibly pleased with our technology and product roadmap evolution, and we're really looking forward to our next generation PCs with Snapdragon. As I said during the call, I encourage everyone to look at the announcement from Microsoft at Build and how that's gonna drive much more AI onto the Qualcomm platform. And I was just gonna leave you all with a thought. I, one of the great things about the execution of the company, every time we enter a new market or we set ourselves to go to a new market, and we end up building a very strong position. We went from mobile to our front end, we became number one. Same thing when we went to Wi-Fi. Automotive, it was something that we had ambition to build as part of the diversification. I think we're quickly becoming the industry partner of choice. We believe that there's a long-term opportunity with virtual reality, augmented reality, and now we have the absolute majority of the designs. And with PC, we clearly build the leading platform, and we have the product momentum that we hopefully will translate into financial in the coming years. So I just wanted to state that we feel good about the company technology capabilities and how we're driving growth and diversification for shareholders. Thank you very much for the support. Thank you to all our employees, and I'm looking forward to talk to you in the next call. Ladies and gentlemen, this concludes today's conference call. You may now disconnect.