Greetings, welcome to the Qorvo, Inc. Q4 2023 conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Douglas DeLieto, VP Investor Relations. Thank you. You may begin. Thanks very much. Hello, everybody, and welcome to Qorvo's fiscal 2023 Q4 earnings conference call. This call will include forward-looking statements that involve risk factors that could cause our actual results to differ materially from management's current expectations. We encourage you to review the safe harbor statement contained in the earnings release published today, as well as the risk factors associated with our business in our annual report on form 10-K filed with the SEC because these risk factors may affect our operations and financial results. In today's release and on today's call, we provide both GAAP and non-GAAP financial results. We provide this supplemental information to enable investors to perform additional comparisons of operating results and to analyze financial performance without the impact of certain non-cash expenses or other items that may obscure trends in our underlying performance. During our call, our comments and comparisons to income statement items will be based primarily on non-GAAP results. For complete reconciliation of GAAP to non-GAAP financial measures, please refer to our earnings release issued earlier today, available on our investor relations website at ir.qorvo.com under Financial Releases. Joining us today are Bob Bruggeworth, President and CEO, Grant Brown, CFO, Dave Fullwood, Senior Vice President of Sales and Marketing, and other members of Qorvo's management team. With that, I'll turn the call over to Bob. Thanks, Doug, welcome everyone to our call. Qorvo's Q4 results were consistent with the outlook provided during our February 1st earnings call. Looking at our end markets, the quarter played out largely as expected with lower end market demand in some markets, primarily those with consumer exposure and channel inventory consumption, with the majority of that being in the android ecosystem. We made significant progress clearing channel inventories. At the same time, we continued to introduce new products and secure new designs, positioning Qorvo to best support our customers as end markets recover. We are seeing increased strength in customer design activity across our businesses, and we are confident in our ability to grow. In High Performance Analog, we enjoyed relative strength in power devices and defense markets, offset by our management markets with consumer exposure and inventory digestion at infrastructure OEMs. We continue to enjoy broad-based, multi-year design win activity that we see contributing to long-term growth. In our Connectivity and Sensors Group, relative stability in automotive during the quarter was offset by continued inventory drawdowns and weak end market demand for Wi-Fi-enabled products and cellular IoT. Design activity was strong across a variety of applications, including smart home, precision location, indoor navigation, automotive connectivity, automotive smart interiors, and enhanced human machine interfaces. In Advanced Cellular, total Android revenue was up sequentially on the strength of a large customer flagship ramp with record Qorvo content. We believe March was the low point for China-based android quarterly revenue, and we expect total Android revenue will grow sequentially in June while channel inventories continue to be consumed. Design activity during the quarter continued to be favorable across all leading smartphone OEMs. Now let's turn to some quarterly highlights. In High Performance Analog, Qorvo was selected by an industry leader to supply cell-to-satellite solutions that combine a variety of technologies, including multiple RF components and GaN-based multiplexers. These solutions enable low Earth orbit-based space-to-terrestrial connectivity, helping to provide cellular coverage in the hardest to reach geographies. We achieved a milestone with the delivery of our first prototype RF multi-chip modules to BAE Systems under the SHIP contract with the U.S. Department of Defense. Qorvo is leveraging our State-of-the-Art production capabilities in our Richardson, Texas facility through advanced heterogeneous packaging integration that enables significant savings in power, size, weight, and cost. This early milestone showcases the speed and efficiency of our collaboration with our program partners. It is a critical first step towards the goal of reestablishing U.S. leadership in microelectronics and accelerating the modernization of microelectronic systems for next generation phased array radars, unmanned vehicles, and satellite communications. In our power device business, we booked a multi-million dollar follow on silicon carbide inverter order for residential and industrial solar applications. The Department of Energy forecasts solar power will make up more than half of new capacity in the US in 2023, and the market for silicon carbide inverters is expected to achieve double-digit compound annual growth rate through 2026. This win complements our ongoing business in automotive charging applications and data centers. In our connectivity and sensors business, we were selected to supply ultra-wideband solutions across multiple verticals, including a next generation smartwatch supporting secure car access, Wi-Fi access points enabling indoor navigation, and an additional 2024 flagship Android smartphone. Of note, ultra-wideband design activity for in-car applications has ramped up significantly. We are a member of the Car Connectivity Consortium, and we are proud to be a contributor to the Digital Key Plus program for the Android ecosystem recently announced by BMW. With Digital Key Plus, BMW drivers with compatible smartphones can unlock or lock their car and start the engine without having the key and without removing the phone from their pocket. In automotive connectivity, we collaborated with automotive OEMs and leading third parties to advance smart antennas and next generation shark fin architectures. We also expanded design engagements related to 5G network access devices with automotive tier ones. In sensors, we secured a design win to supply force sensing touch sensors in support of a premium true wireless headset for a leading European OEM. The headset will leverage the ultra-sensitivity of Qorvo's MEMS-based sensors to enable a new industrial design. In Wi-Fi, we secured our first Wi-Fi 7 BAW filter design wins, and we expanded sampling of our Wi-Fi solutions, enabling full coverage of 2.4, 5 and 6 gigahertz bands for smartphones and consumer and enterprise access points. In advanced cellular, we supported the ramp of a Korean-based smartphone OEM's flagship smartphone with multiple Qorvo placements, including low band, mid-high band, and ultra-high band pads, as well as secondary transmit, tuning, and Wi-Fi. We are pleased to support this customer broadly in their flagship tier, and we are seeing expanding opportunity as they migrate their mass market portfolio to integrated 5G solutions. Across the Android ecosystem, Qorvo was awarded broad-based design wins in support of flagship, mid-tier and mass market 5G devices at the top five Android smartphone OEMs. To support new designs, we shipped our first samples of our newest mid-high band PAD to an Android OEM, addressing this customer's most challenging performance and size requirements. This is the industry's most highly integrated front-end placement. It combines main path and diversity receive content for the mid and high bands. As we said previously, this product integrates nearly 2 times the BAW filter content in a smaller footprint than existing main path only mid-high band PAD architectures. It leverages the reduced size and enhanced performance of our newest BAW and SAW filters. We expect the first smartphone featuring this solution to launch in calendar 2024. Across the business, we are leveraging investments in best-in-class technologies to introduce differentiated products that delight our customers. We have many growth drivers in our portfolio and design activity has been strong. In HPA, design wins secured in the March quarter span a variety of applications in aerospace, battery management, defense radar, electric vehicles, and renewable energy systems. In CSG, we secured new business in automotive connectivity, indoor navigation, smart home and wearables. In ACG, we enjoyed broad representation across all leading OEMs. We are increasing our content in the highest volume flagship phones. We believe we have room to grow at our largest customer, including BAW-based content. We are a leading supplier to the Android ecosystem, where the transition to 5G supports long-term content gains. Last year, approximately 40% of the roughly $920 million Android smartphones were 5G. We see Android 5G smartphone unit growth achieving a double-digit CAGR for several years. Over time, we expect HPA and CSG to outpace the growth rate of ACG, increasing our total growth rate and driving leverage as mix increasingly favors our high growth investment businesses. I wanna thank the team for continued operational excellence. We are introducing new technologies and launching new products to align with the industry's growth drivers and broaden our market exposure. We are seeing increasing strength in customer design activity across our businesses, and we expect improved financial performance supported by content gains in large customer programs. With that, I'll hand the call off to Grant. Thanks, Bob, and good afternoon, everyone. As a reminder, our references today will be to our three operating segments, High Performance Analog or HPA, Connectivity and Sensors Group or CSG, and Advanced Cellular Group or ACG. In our upcoming 10-K, we will provide historical financial information that reflects these operating segments. I'll now turn to our latest quarterly results. Revenue for the quarter was $633 million. Non-GAAP gross margin was 41.3% and non-GAAP EPS was $0.26. Relative to our expectations as provided on our February earnings call, results exceeded the midpoint of guidance despite a weak demand environment and channel inventory reduction efforts. As considered in our Q4 guidance, we held factory production at uncharacteristically low volumes, which created underutilization impacts that negatively affected margin. On a non-GAAP basis, gross margin of 41.3% improved sequentially given a modest increase in factory utilization. Charges related to low factory utilization continued to weigh on margins on a year-over-year basis. Non-GAAP operating expenses in the quarter were $227 million. Consistent with our expectations, OpEx was up sequentially given the timing of seasonal employee-related expenses such as payroll taxes, the timing of vacation accruals, and other items. In absolute dollar terms by functional area, the sequential increase was principally driven by R&D as we support our customers and invest in future growth opportunities. In total, non-GAAP operating income in the quarter was $34 million, or 5% of sales. Breaking out operating margin by each segment, ACG was 14%, HPA was 13%, and CSG was negative 51%. During the quarter, Qorvo Biotechnologies reduced CSG operating income by approximately $11 million. As a reminder, we are currently in the process of seeking strategic alternatives for this business. Non-GAAP income was $26 million, representing diluted earnings per share of $0.006. Fiscal Q4 GAAP results were impacted by two notable non-cash balance sheet impairments. These items were recorded during the quarter, address multi-year time horizons and do not reflect the underlying performance during the period. The first impairment is related to Qorvo Biotechnologies. While we are seeking strategic alternatives, it is too early to comment on possible outcomes. We strongly believe in the technology and the team, feel the business will more quickly achieve its highest potential outside of Qorvo. During the quarter, we determined that the investment required to fund the future roadmap would not fit within our business model. Without the internal funding commitment, the forward-looking outlook would not be realized under Qorvo ownership, and consequently, the asset failed the test for impairment. The second impairment is related to the cash deposit asset on our balance sheet tied to a long-term silicon supply agreement. There is no cash impact during the period, as the deposit was remitted to the supplier at the time the agreement was executed, and was scheduled to be refunded at the end of the agreement in calendar 2026. We have elected to apply the prepaid cash deposit against portions of monthly purchase commitments in lieu of ordering additional wafers. This will allow us to better align our specific mix of silicon wafer inventory with SKU-level finished goods demand over time. We are comfortable with our current silicon inventory relative to forecasted demand, while mindful of the risk in ordering long lead time materials. A reconciliation between GAAP and non-GAAP results can be found in the earnings release, and more information will be available in our upcoming 10-K. Moving on to the cash flow statement. Capital expenditures were $34 million, resulting in free cash flow of $31 million. During the quarter, we repurchased $150 million worth of shares. The rate and pace of our repurchases is based on our long-term outlook, free cash flow, low leverage, alternative uses of cash, and other factors. Turning to the balance sheet, as of quarter end, we had approximately $2 billion of debt outstanding, with no near-term maturities, and $810 million of cash and equivalents. Our net inventory balance ending the quarter was down $61 million to $797 million. For the full year, we recorded revenue of $3.6 billion, non-GAAP gross margin of 46.3%, non-GAAP operating margin of 21.1%, and non-GAAP earnings per share of $5.99. We had two 10% customers in fiscal '23. Apple accounted for 37% of total sales in fiscal '23 versus 33% in fiscal '22, and Samsung accounted for 12% of total sales in fiscal '23 versus 11% in fiscal '22. Looking forward, we are encouraged by ongoing progress in reducing channel inventories, and we expect to benefit from strong dollar content growth on a large customer seasonal ramp. Turning to our current quarter outlook. We expect quarterly revenue between $620 million and $660 million, non-GAAP gross margin of approximately 41.5%, and non-GAAP diluted earnings per share of approximately $0.15. Our outlook contemplates the current demand environment, further consumption of channel inventory, and seasonal factors. Our non-GAAP guidance for fiscal Q1 includes normal operating spend for the biotechnology unit, but excludes any costs related to its divestiture. We project non-GAAP operating expenses in the June quarter will be up approximately $10 million sequentially due to investments in multi-year customer programs, investments in core systems and other productivity initiatives, and the return of incentive compensation based on our expectations for improved financial performance. Below the operating income line, non-operating expense will be approximately $10 million-$12 million, reflecting interest paid on our fixed rate debt offset by interest income earned on our cash balances, FX gains or losses, along with other items. Our non-GAAP tax rate for fiscal 2024 is expected to be within a range of 13%-15%. We expect our inventory balance will increase in the June quarter as we support a seasonal ramp at our largest customer. In terms of channel inventory, inventories of our components in the Android channel were reduced during the March quarter by approximately 25%. This follows a more than 20% reduction in the December quarter. Our expectations for this quarter are for channel inventories to decline again in the double digits. Later this calendar year, we expect Android channel inventories will normalize. Outside of the Android ecosystem, there are smaller pockets of channel inventory elsewhere in our business that may take longer to digest. For the full year fiscal 2024, we forecast revenue will be above fiscal 2023 and expect to benefit from strong dollar content growth at our largest customers. For the full year, fiscal 2024 non-GAAP gross margin is expected to be approximately 44%, with variability on a quarterly basis, primarily tracking utilization and mix. Looking across the fiscal year, we expect significant sequential improvement in gross margin during fiscal Q2 as we sell new products for our largest customers that are less burdened by higher costs associated with underutilization. We expect sequential declines in gross margin during Q3 and again in Q4, primarily related to utilization and mix. Beyond June, excluding biotechnologies, operating expenses for Q2 through Q4 are expected to be approximately $240 million-$245 million per quarter, with variability related to the timing of product development spend, investments in core systems and related productivity initiatives, the return of incentive compensation based on our expectations for improved financial performance, as well as other items. Qorvo enjoys many growth drivers across our three operating segments. We're leveraging a broad portfolio of technologies and capabilities to grow content this year on large customer programs, and we are uniquely positioned across leading customers and end markets. We are investing to drive outsized growth in diverse businesses to broaden our market exposure and accelerate growth. At this time, please open the line for questions. Thank you. Thank you. We will now conduct a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that you limit to one question and one follow-up so that others may have opportunity to ask questions. One moment while we poll for our first question. Our first question comes from Toshiya Hari with Goldman Sachs. Please proceed. Hi, guys. Good afternoon. Thank you so much for taking the question. I guess my first question, hoping you could talk a little bit about full year 2024 revenue. Grant, you gave, you know, good color on gross margin, and OpEx as well, but how are you thinking about the top line in fiscal 2024? If you can kind of provide context around or color around the three segments, that would be super helpful. I then have a follow-up. Sure. Thanks, Toshiya. I appreciate the question. This is Grant. In terms of the full year fiscal 2024 guidance, based on our current view and barring any macroeconomic deterioration, right, we're not forecasting a significant jump in handset unit sell through. In fact, we actually believe smartphones to be down year-over-year, but 5G phones to be up in the 5%-10% range. That underpins our overall fiscal 2024 view for ACG. We do expect some growth in HPA and CSG as well, especially as the year progresses. Generally speaking, not a terribly aggressive back half of the year. That said, just walking through the quarters, you know, margin will follow mix, as I pointed out in my prepared remarks. you know, although there's no change to our view of returning to 50% in the gross margin line, it's unlikely in 2024. If I take it quarter by quarter beyond the June quarter guidance, our fiscal Q2 in September, we would expect revenue to be up approximately 50% sequentially. Again, this is driven by strong content gains into a large seasonal ramp. Gross margin will also be up in the neighborhood of approximately 400 basis points quarter-on-quarter as mix begins to favor some newer products, which are less burdened by those higher unit costs associated with underutilization. In the December quarter, our fiscal Q3, we expect revenue to be approximately flat and continuing off of September. Gross margin will be down 100 to 150 basis points as utilization begins to ramp down following that large seasonal ramp and mix begins to modestly shift to some of that higher cost inventory. Finally, in the March quarter, our fiscal Q4 of calendar year 2024, we expect Android to be a higher% of our mix, but decline less than might be historic seasonality due to a clean channel and returning to shipping to end demand. However, gross margin will be down 200 to 300 basis points quarter-on-quarter as mix reflects that higher cost inventory. As I mentioned in the prepared remarks, beyond June, I gave some color around OpEx for the year, which would exclude bio in the $240 million-$245 million per quarter with some of the variability there related to product development spend and other items. Generally speaking, you know, we have a good degree of confidence in content for our September period. As we clean the channel in the Android ecosystem in ACG, we feel comfortable of returning to shipping to end market demand. Tax rate's probably in that 13%-15% range, consistent with the fiscal '23. We believe share counts will be approximately 100 million shares or less. Thank you. Our next question comes from Gary Mobley with Wells Fargo Securities. Please proceed. Hey, guys. Thanks for taking my question. Grant, thanks for that very explicit fiscal year 2024 revenue guide. It's quite helpful. You're welcome. I wanted to ask about something, one of your competitors is talking about this evening, that is, some sub-seasonal shipments to their largest customer, I presume Apple, their modem-only customer. I'm wondering, you know, if that factors into your guidance or is factored into your guidance, what may be some of the undercurrents going on there, how that may impact you from a competitive standpoint or just from a customer specific standpoint. Hi, this is Bob. Gary, thanks for the question. As you know, we don't normally talk a lot about our largest customer. I think what I can say is ACG will be down quarter-over-quarter. You know, we are expecting from a smartphone revenue to be down. Historically, it is a lower quarter for our largest customer. You know, I don't know why whoever said whatever you just said, but I think we have a real good handle on the market. We talk a lot about our model and how things work, so we feel good about what we've said for sure. No doubt. Okay. Do you mind if I ask a follow-up? Absolutely. Go ahead, Gary. I guess the $64,000 question is, you know, what will a new normal look like with your Android customers once they're through draining their excess inventory? What's your best feel based on design win traction? Do you think you can achieve a new revenue high at some point in the future in your Android customer base specifically? Gary, thanks for the question. You know, as you pointed out, always forecasting the future is quite difficult. Here's what I do know. You know, if we go back and look at where we're gaining share and what we've been talking about, the great work we've done in the Android ecosystem, whether that's Samsung and Google and already what we believe we've started to win in 2024. You know, as you know, what we've been facing are these headwinds with, you know, not shipping up the demand and reducing the inventories that Grant went through, the 20% last quarter or two quarters ago, 25% last quarter. You know, as that comes and we continue to gain share there, I believe we can get back there or better, no doubt about it. Again, you know, you have to forecast, you know, our largest customer's done quite well in gaining share in some of their markets. You know, the good news is we're positioned, and I think this is what's important, we're the only strategic supplier of the top six Android manufacturers, and we've got a great business that we're growing with our largest customer. When we look at it from that perspective, what we're convinced is we can continue to grow. Our next question comes from Vivek Arya from Bank of America. Please proceed. Thanks for taking my question. Bob, I'm curious, what do you think is the visibility of kind of retaining this new content over the next several years? You know, customers in this market have a habit of making, you know, different architecture decisions every year. As you start ramping this new content, how do you think you're able to sustain it over the next few years? Yeah. I think what's interesting, Vivek, is, I mean, over time, we've done a pretty good job of holding in the areas that we're winning, nice share and growing. As they add content in those areas, we've done well. As we look out, we feel pretty good about things. You know, I even commented, and Grant did as well, that, you know, we believe we can continue to grow content at our largest customer, whether it be BaU-based or our discrete components that we sell there. We feel good about the outlook there for multiple years. All right. Thanks, Bob. For my follow-up, do you think this was a competitive win, or do you think this is a new technology that customers are adding in this area? Is this expanding the pie, or do you think this is, you know, kind of a competitive win from something they might have been using from somebody else before? Yeah. I think I answered this question last quarter, I believe, on a similar topic. It was both. We're gaining content through both share gains as well as, to your point, making the pie bigger. Both. Our next question comes from Karl Ackerman with BNP. Please proceed. Yes, thank you. Good morning, good afternoon, gentlemen. I guess based on your comments on channel inventory realignment for Android, why wouldn't channel inventory be aligned with sell through by the end of the June quarter, given the further improvements that you're seeing? As you address that question, how would you characterize the inventory balances and timing of reaching normalized inventory in your infrastructure and IoT businesses? This is Dave. I'll take that question. In the Android ecosystem, you gotta remember, we ship a lot of products into a lot of different customers. It all depends on their program ramps. How well their phones sell through relative to their expectations. In some cases, you're right. We're gonna be in pretty good shape by the end of the June quarter. In other cases, it'll probably take a little longer depending on the customer and their business. But as Grant said, by the H2 of the year, we definitely see the Android ecosystem. We should be clear of all the channel inventory and be back to shipping to the true end customer demand. Base station is gonna take a little longer. I think some of those customers built up more inventory, you know, during the tight supply conditions of last year. It's just gonna take some of those customers longer to burn that off. we see that probably taking through this calendar year and into the early part of next year. Hey, Karl, this is Grant. Let me jump in there, and maybe if I take it up a level. Our view on channel inventories is incorporated in our guide. Our 50% increase in the September quarter is predicated largely on content gains. You know, sequentially, we would expect the channel to begin clearing and us to begin shipping to more normalized demand later in our fiscal year. Again, it doesn't incorporate anything aggressive in terms of unit growth. This would be simply a return to what could be considered somewhat normal, and that would be incorporated in our guide. You can make at least the quantification of it based on that. Clear. Thank you. Our next question comes from Edward Snyder, Charter Equity. Please proceed. Thanks. You guys seem very confident about content gains in the fall. Bobby said both share gains and new content. Maybe we dig a little bit further down to the share gains aspect. Is this areas that you've not shipped before because you guys tended to focus on specific areas, and there's been some kind of back and forth in a couple of slots, or is it gonna be something completely new? You mentioned kind of an all-in-one mid, high band, DRX, et cetera. We're watching that. The channel has been looking at that for some time. It's been attempted in the past, but it's too constrained. It sounds like more Android guys are open to that. Question there is, all-in-one, it gives you more defensible position because you're one of the few companies that actually build an all-in-one, but doesn't it also compress the total ASP or the total revenue available versus selling separate modules? Can you give us a feeling on how that trade-off works? Then I had a follow-up, please. Yeah, thanks, Ed. As you know, for our largest customer, we won't talk about any future architectures, but I'm sure once you tear down the phones, you'll see where we want. As I said, we're very confident in our ability to continue to grow there. And Dave, you wanna take care of the work that we're doing there... Yeah. The second part of his question. Ed, you referred to it as an all-in-one, and what we talked about on the bullet there was a solution that combines the mid, high band plus the diversity receive. That diversity receive, that's all new content for us. We don't traditionally service that part of the phone. In general, we're supporting our customers, I think with a very high performance, small size is what they're looking for. That's creating a lot of value as well. We don't see it as an ASP issue. It's a very high performance, small size solution that's gonna drive. Great. If I could, you took another charge on the silicon supply agreement. I understand things are slow here. By my calculations, you probably have what you've got maybe $60 million-$70 million left on that. Any feelings about how that will play out? You used your deposit, to offset a cash cost this quarter. Will that continue if you're, under-purchasing from that supplier? I'm just trying to get a feel for how that plays out next several quarter. Sure, Ed. This is Grant. I'll take the question. Quarter-on-quarter at a high level, our revenue outlook for fiscal '24 hasn't changed. If anything, it's actually improved. What has changed would be our current forecast of mix over the out years in that contract, right? As you understand, wafers aren't fungible once they've been fabricated, and our demand profile is complex. The supply agreement covers multiple products, technologies, customers across multiple years. There's a significant mix impact. Furthermore, we can't order wafers for products that haven't been designed yet, so there's a timing element as well. Since we have to place those POs well in advance, we have to make sure we manage our inventory accordingly. We're comfortable with our current inventory based on forecasted demand, so we're applying our prepaid deposit, as you mentioned, to the wafers that we don't believe we'd ultimately need. We know there'll be continued variability in the mix over the remaining life of the agreement. Could be better, could be worse, but this is something we analyze each quarter, and we're continuing to work with the supplier in that case to stay aligned. Our next question comes from Matt Ramsay with Cowen and Company. Please proceed. Yes, thank you very much. Good afternoon, guys. Thanks for taking my question. I obviously really appreciative of all the additional fiscal 2024 detail and guidance color, and I know there's content things that are happening. I guess I just wanna think about philosophically right now, giving all that additional detail and guidance on a per quarter basis all the way through the fiscal year. I mean, a lot of us are listening to the MediaTek commentary out of Asia, just got off the Qualcomm call listening to their comments, where certainly it seems like a lot more uncertainty in the handset market all the way around, at your largest customer, in terms of volumes and in terms of the market recovery in China. I guess the question I have is really just about the choice to give all that granular detail right now through the next four quarters and the level of confidence sort of underpinning those estimates, just given all that's going on in the macro despite the content gains you have. Thanks. Sure, Matt, this is Grant. Let me take the question. First off, we usually give some color around the forward fiscal year as we start it. It's something that we do as a matter of practice. I think it's extremely helpful in this case, given the volatility in the market. I hope that it's helpful for you as you're putting your models together. In terms of the quarter by quarter guidance, it's so specific to the margin profile, given the mix of products and the inventory balances we're carrying, that I wanted to make sure that we were upfront and helping people understand the margin is gonna follow that mix and to a degree, the utilization associated with those customer ramps. It's important to understand it will vary on a quarter by quarter basis. I wanted to make sure that we gave as much color as we could there. Underpinning our overall view, again, is nothing overly aggressive from a recovery or a step function jump in handset unit sales. I don't wanna be, you know, overly conservative, but there's nothing aggressive there. As we've said, we're really looking to just clear the channel inventory. We've been working aggressively to do so, and I think we're making a lot of progress there. As we return to normal in the channel later in our fiscal year, we should see some incremental improvement, just simply being able to ship to what would be considered end market demand. No, thank you for all the detail there. As my follow-up, it's great to see the inventory in Android coming down. I think you guys mentioned 20% reduction last quarter and then another 25% reduction now. It maybe just could you level set us on an absolute dollar terms or maybe a unit terms of where you see the inventory that needs to still be worked through in the Android community? Or how much of a drag is it still for another couple quarters? If there's any kind of quantification there, that'd be helpful as we think about maybe modeling beyond the inventory burn over the next couple quarters. Thanks. Yeah. Matt, I'll make a couple comments and then turn it over to Dave. You know, we really don't wanna get into giving dollars and units and all that because it moves around based on future demand. I think what we can say is that, you know, we're gonna continue to reduce the channel inventory, so we have a ways to go. You know, what we said was we'll reduce it this quarter, and we'll probably continue to reduce some in September. It's probably gonna take till December on the overall overall channel inventories. You know, I think we were one of the first saying, "Hey, we were gonna do this," to your point. I can't speak for the others that you're listening to, but, you know, we started to throttle back on this a long time ago, and others are just seeing it. I also think our lead times are much shorter than theirs, which is why we saw this before they did and saw it now coming back differently. Coming back in the sense, not the market's coming back, that we've made significant progress on reducing the inventories in the channel. The headwinds are subsiding, and you know, slight tailwinds are gonna be behind us as we start shipping into the end demand, even though it's significantly lower than what we saw a year ago. I think I'd couch it that. Dave, if you wanna add any color to that, feel free. No, I think they're all good comments, Bob. You know, we did see that the Android sales, we think that bottomed in December, and our sales into China bottomed in March. As Bob said, we've still got some work to do to clear that inventory in the next couple of quarters, but we do see that improving already. Bookings are up, customer demand is coming back, and so it's only a matter of time at this point. Thank you. The next question comes from Ambrish Srivastava with BMO Capital. Please proceed. Hi. I actually had Matt ask a good question. I was just similar along those lines. Excuse me. On the gross margin side, Grant, is that largely a factor of utilization? Could you please quantify for us, 'cause it's not under your watch, but gross margin performance has been, excuse me, pretty volatile. Just help us understand, is utilization at its lowest ever or in the recent past? Is that the biggest driving factor that gives you the confidence on the gross margin side? Sure, Ambrish. This is Grant. I'll take the question. Yes, by far, in the Pareto, underutilization is the largest item. I think last quarter we quoted over 900 basis points, and it's in this Q4 period just ended, it was approximately 1,000 basis points. Very consistent headwind there from an underutilization standpoint, again, the largest factor. That underutilization plays into higher unit costs that we're carrying for the products that we have in inventory. As those work their way through the P&L via COGS, you're gonna see that continued pressure from underutilization going forward for some period of time, which was the comments we made last quarter as we began to talk to fiscal '24 and reinforced by my guidance today. Underutilization, to your point, is by far the largest item. The next item, which I've commented again on before, is the headwind associated with inflation. We're seeing, you know, in the neighborhood of 80 basis points, maybe 100 basis points there. A distant second to underutilization. Okay, super helpful, and we all appreciate the details. Just real quick on the assumptions for the +50% quarter-over-quarter growth. Is that largely of inventory normalizing? Cause you pointed out that demand continues to be uncertain. Is that largely driven by some sense of normalization on the Android side, and then the second factor being the content gains at your large customers? Is that the right way to think about it? I would turn that around. I, very little expectation of the channel clearing in time for the September quarter. Very much dependent on content gains and in a large seasonal ramp. The next question comes from Ruben Roy with Stifel. Please proceed. Thanks. Thanks for taking my question. Grant, wanted to just talk a little bit about HPA and CSG in terms of how you're seeing the rest of the year play out. You mentioned that you're not terribly aggressive, but do you do think there's gonna be some growth progressing through the year? Wonder if you could talk a little bit about the pricing environment in those markets. There's been a lot of discussion around pricing, you know, when things were tight last year and, you know, how you're thinking about that as we flow through this year. You know, also if you just comment on, you know, where we are in inventory and when you, when you think, you know, that normalizes when we get back to sort of your longer term, you know, kind of growth targets for those two businesses, that'd be great. Thanks. Thanks for the question. I'll take the first part. I'll let Dave comment on pricing. In terms of our HPA and CSG businesses, we would expect to see strength in defense and power devices within our HPA business that will grow over the course of the year. In our CSG business, we'll see growth in Wi-Fi business and then the other connectivity elements, including UWB. A strong sense and confidence on those businesses given where they're standing today and the growth trajectory over the, over the year. Dave, if you don't mind commenting on pricing. Yeah. I mean, certainly the pricing environment that you referred to, a year or two ago is a little different now, but we don't see anything, you know, out of normal from what we see in the market. We're pretty excited about in 5G entry. I think Bob mentioned that only 40% of Android phones last year had converted to 5G, we still got a long way to go there. We see that growing at double digits for the next several years. That's all new content for us because we really haven't participated in the 4G entry space for many years. As customers start to migrate more and more of their portfolio to 5G, that's all new opportunity for us. We're pretty excited about that growth opportunity as well. Ruben, maybe I'll give you just a little bit more color here on the segment revenues in Q4, and then I'll compare it to a year ago just for reference. HPA in Q4 was $133 million in revenue, CSG was $82 million in revenue, and ACG was $418 million. If we look back one year at the March quarter in our fiscal '22, HPA was $211 million, CSG was $179 million, and ACG was $777 million. You know, as we get back to those levels of growth we would expect over time, you know, we should see some forward progress throughout the fiscal '24 year. That's great. Thanks for that perspective, Grant. Appreciate the breakout for Q4 before the K came out. If I could just really quickly, Bob, on, I guess following up to Ed's question on ASPs. With all the content, you know, kind of moving up to kind of the BAW filter content in one of your placements, is $5-$7 still the right way to think about, you know, kind of the ASPs in a, in a typical 5G asset, or do you think at some point we start to, you know, push that higher with the value being added? Yeah. I think your number is probably on the low side. If we look at, you know, the average smartphone, it's much higher than that. but we see that pretty stable over time. I mean, of course, there's gonna be ASP erosion, but the conversion from 4G to 5G is gonna be a big driver to offset that. There's also new content. you know, Wi-Fi 7 is gonna add new content. We talked about our BAW filters there. Also as you look backwards in time, in a lot of cases, Wi-Fi 5 and prior, there wasn't even a FEM involved. Wi-Fi 6 and now Wi-Fi 7, there's opportunities there for us with our FEMs and our Wi-Fi portfolio, and we're well represented across all the reference designs there. Even in 5G, there's continues to be new capabilities, new requirements coming in 5G-Advanced, and that's gonna increase complexity, increasing the performance requirements, and in a lot of cases, there's new content opportunities there as well. All that's gonna be, you know, easily enough to offset any ASP erosion that we see. Thank you. Our next question comes from Srini Pajjuri with Raymond James. Please proceed. Yeah, thank you. Bob, just a question on China. I think you're guiding for sequential growth in Q2, June quarter. I'm just curious, it's slightly more optimistic than what we heard from some of your peers. Is this driven by the smartphone side, or is it more non-smartphone business that you're seeing a little bit of a pickup there? In general, if you can talk about what you're seeing in China, because there's been a lot of expectation. I think, we're still kind of, not seeing a whole lot of pickups since the reopening. Any comments there I think would be helpful. 100% agree with your last comment. We're not seeing any pickup either. What we've been making clear now for the Q2 now, we continue to reduce the channel inventories. As you do that, you know, we've reduced the inventory, customers do need to order some parts. All we're saying is in our revenue, we're gonna see an uptick. That has nothing to do with end demand. It means we're signaling we're heading towards the bottom of cleaning up the channel. I think Dave just mentioned that our bookings were up strong. In fact, we had the largest bookings in China for almost two years now. All we're showing is the momentum is changing, not in the end market, not in the end market. We don't disagree with anything that you guys have heard from others. We've done a very good job over the last two quarters of significantly reducing the channel inventory. All we're saying is we're starting to see that bottom. As I mentioned earlier, you know, the headwinds are subsiding and the tailwinds are starting to come. That's not an end market comment. That's a comment about our revenue. Got it. Thank you for that clarification. Then, Grant, on the gross margin, I know a lot of questions have been asked about utilization. If I take your, I guess, guidance, looks like you're gonna exit the year in low 40s. I'm just trying to bridge the gap between that and your long-term model. Is it primarily utilization or, are there any other factors that, you know, are gonna, I guess, you know, help you get to that 50% plus levels? Sure. It's really the two factors, right? There's both utilization and mix. As we're selling newer product that didn't run through the factories when they were underutilized, obviously they carry better unit costs, and you see that in gross margin, in the September quarter. In the December and March quarters, you start to see more sell-through of product that we have already got on the shelf, and that incorporates higher unit costs due to prior underutilization. It's a bit of mix and utilization. Okay. Is there any revenue level, Grant, that you think you need to get to before, you know, we see a five handle on the gross margin side? I wouldn't tether it to revenue. Again, it goes really back to mix. It depends which products we're selling through, and what kind of content are in those products. It's not an absolute revenue level, but again, really related to mix. Thank you. The next question- Sorry, just to follow up on that. I do feel confident in the path back to 50%. As I pointed out earlier, you know, in the Pareto of gross margin, it's dominated by underutilization. You know, really in terms of the path back, it's just a question of filling up the factories in order to get there. Thank you. The next question comes from Atif Malik with Citi. Please proceed. Hi, thank you for taking my question. Grant, I have two questions. How do we look at, kind of the strategic exposure to your largest customer? You said fiscal '23, Apple was 37%, Samsung, 12%. It sounds like based on the content gains this year, you will, you know, grow those percentages, both these customers. Historically, Apple is, you know, in terms of profitability, has not been the best exposure name. How are you balancing content growth with profitability? Sure. Well, as Bob pointed out, you know, high degree confidence in our, in our content there. We're fully supporting all of our customers, that one, of course, as well. You know, as we look forward, we've never guided to any particular customer as a percent of revenue, so I'd hesitate to do that now. You know, as we mentioned, we do feel good about our positioning there. In terms of managing profitability going forward, as I pointed out in my prepared remarks, we are heavily investing in multi-year opportunities at multiple customers. You know, those R&D dollars are spent today for revenue in the out years. We feel like we're positioned to win. We have the technology in place to do so, and we're confident in our development and the investments we're making. Understand. Then on the power devices, silicon carbide, I understand you're growing from a small base, and you have the multiple million-dollar order on the inverter side. How strategic is this business to Qorvo? How are you investing your R&D dollars towards this business? Could this be, you know, a 10% type business maybe in a couple of years? We think it's a very strategic investment for Qorvo, right? It's similar to a lot of the other compound semi work we do. We have a differentiated solution with our GaN FET technology. We have a lot of customer demand. In terms of the investment there, you know, I think it's well-placed. We, we do expect to grow significantly. As you'll see in the 10-K, we will be paying a contingent payment to the shareholders of United Silicon Carbide, which reflects a lot of success in that business that we've seen since we've taken it over. The next question comes from Harlan Sur with JP Morgan. Please proceed. Hi, good afternoon. Thanks for taking my question. As you guys are set to ramp into new smartphone models across your customers in the H2 of this year, you know, I appreciate the new and higher content gains. How are the pricing trends on a like for like components on these new model ramps, either versus prior generation or on a year-over-year basis? Yeah, I don't think we can comment on a like for like. I mean, every generation, there's always new challenges to solve, we're just excited about the content gains that we have. As Bob mentioned, in some cases, that's new content, in some cases it's share gain. That's probably true as you look across the customer base, you know, similar story plays out. Okay, perfect. I believe it's spread across both your HPA and Connectivity segments, but wanted to get your views on the broadband access markets, cable, fiber to the home. On the infrastructure side, you know, where are we in the DOCSIS 3.1 upgrade cycle? Seeing lots of activity on DOCSIS 4.0. On the gateway side, hearing Wi-Fi 7 home gateways may be starting next year. The team has multiple tailwinds here. What is the team's sense on timing? More near term, like what's the state of the access markets demand-wise? Are you guys also burning through excess inventories here? Yeah, I think the timing of what you said, I think that's pretty consistent with what we're seeing. We do see a lot of new design activity in the newer standards, and we're very well positioned there with our technology. And to your point, we do see some inventory challenges there as well that we're working through. We think that's relatively near term, but there will be a little bit of challenge there to get through in that business. Thank you. At this time, I would like to turn the call back over to management for closing comments. We wanna thank everyone for joining us today. We appreciate your time. We look forward to meeting with you at upcoming investor conferences. I hope you have a good night. Thank you. Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.