Welcome to Broadcom Inc.’s Third Quarter Fiscal Year 2018 Financial Results Conference Call. At this time, for opening remarks and introductions, I would like to turn the call over to Tom Krause, Chief Financial Officer of Broadcom Inc. Please go ahead, sir.

Thank you, operator, and good afternoon, everyone. Joining me today is Hock Tan, President and CEO of Broadcom. Today, Hock is going to give you a detailed review on our core business and spend some time outlining the industrial logic behind our recently acquisition of CA. I will then spend time reviewing our Q3 results and Q4 outlook, and most importantly our financial model and capital allocation policy. Quickly on the formality. Today’s call, will primarily refer to non-GAAP financial results. A reconciliation to U.S. GAAP measures is included in today’s press release, which is available in the Investors section of our website at broadcom.com. Information on risks that could cause actual results to differ materially from the forward-looking statements made on this call is also available in today’s press release and in our recent SEC filings. This conference call is being webcast live. A recording will be available via telephone playback for one week and archived in the Investors section of our website at broadcom.com. At this time, I would like to turn the call over to Hock. Hock?

Thank you, Tom. The strength of our business model delivered another quarter of very sustained revenues, strong earnings and free cash flows. Consolidated net revenue for the third quarter was $5.07 billion, 13% increase from a year ago and EPS came in at $4.98, a 21% increase from a year ago, while free cash flow at $2.13 billion is 42% of revenues. We have a lot to cover today. So, let’s dive right into the segments. Starting with wired. In the third quarter, wired revenue was $2.3 billion, growing 4% year-on-year. And this segment represented 45% of our total revenues. Third quarter wired results reflect strong year-on-year growth for both our networking and compute offload businesses, driven by robust demand from the cloud data center markets, as well as traditional enterprises. Networking and compute offload represented approximately 60% of our total wired segment in the quarter and grew over 10% year-on-year in the quarter. This is off the back of growing over 15% annually in the second quarter. So, this part of the wired segment is doing really well. However, cyclical headwind in certain parts of our broadband businesses has impacted year-on-year growth for the wired segment. While digital subscriber line or DSL demand remained stable, demand for PON, fiber-to-the-home in China, as well as video access, particularly North America, has been soft, compared to a very strong 2017. As a result, broadband was down year-over-year in the third quarter after being down in Q2 as well. Turning to the fourth quarter fiscal 2018. We expect networking and compute offload to continue to grow double digits year-on-year as strong demand from both the cloud and traditional enterprise sustain. However, cyclical headwinds we have seen in video access including cable and satellite are persisting into the fourth quarter. And as a…

Thank you, Hock, and good afternoon, everyone. My comments today will focus primarily on our non-GAAP results from continuing operations, unless otherwise specifically noted. Let me walk through our results for the third quarter of fiscal 2018. Third quarter net revenue was $5.07 billion, just ahead of the midpoint of our guidance. Our gross margin from continuing operations was at the high-end of our guidance, the 67.3%, as we benefited from the more favorable product mix in the quarter. Operating expenses were slightly lower than we expected at $874 million, driven by lower SG&A. As a result, operating income from continuing operations for the quarter was $2.54 billion and represented 50.1% of net revenue. Adjusted EBITDA for the quarter was $2.71 billion and represented 53.4% of net revenue. For housekeeping purposes, Q3 depreciation was $129 million in the quarter. Below the line, net interest expense was slightly better than guidance due to high interest income from our cash deposits. The tax provision was in line at 7% of operating income from continuing operations or $170 million. The diluted share count was 453 million shares and includes the weighted average impact of the stock repurchases completed in the quarter. As a result, the Company delivered $4.98 of EPS in the quarter. This represents 21% year-on-year growth, including the impact of share repurchases. Working capital, excluding cash and cash equivalents, increased approximately $209 million, compared to the prior quarter, due primarily to an increase in receivables. This increase was driven by seasonally higher shipments in the last month of the quarter, as well as the effect of a distributor consolidation program for the Brocade business where we are providing a temporary extension to payment terms to facilitate the consolidation. In addition, cash restructuring expenses were $18 million, as we are now at…

Certainly. [Operator Instructions] Thank you. And our first question comes from the line of Tim Arcuri with UBS. Your line is open.

Hi. This is Pradeep [ph] on behalf of Timothy Arcuri. I had a question more on the longer term view of CA and the wireless solutions group. And how you view the wireless solutions group from a strategic standpoint, given that the CA acquisition is kind of focusing you guys towards more of an infrastructure company?

That’s a very interesting question and it offers me the opportunity to clarifying how we look at our composite set of businesses. Our business model is very much focused on putting together a portfolio -- on portfolio of what we consider product technology, product franchises. And that’s not necessarily limited to IT infrastructure or networking or data centers in any particular specifics. As you notice, we have a range of products that sells into multiple end markets which ranges from wired and even in wired, we have made a distinction, as I said, of networking, data centers, as well as more service provider spending as it relates to carrier access, and PON and video delivery, and the two sets of end markets by itself. Then, we have enterprise storage, which is very data center centric, I mean. But then, you’re right, we have wireless, which is, as we define it, is very focused on mobilities and smartphones where we put up the best latest technology. And finally, we have industrial where we have a set of products that goes to various industrial product, necessary to make that the data centers. So, they are very disparate, they are very diverse. And there in our view lies our strength. It’s very set of diverse products, franchises and that’s the key to operating, franchises. But each of them is very -- a set of common characteristics. One is, they operate in niche markets typically, those are the niche markets that become mass markets, because mass markets have moved over to these niche markets. And for two is, we have the technology, more technology, we are the leader in technology in each of this niche markets. And we tend to have the highest market share too in each of these end markets. And the common thing we do is, they all sit on our platform, but each of those features keep investing and you’ve seen the level of dollars we invest. We’re investing over $3 billion, $3.2 billion a year just on R&D and product development as we move through each generation and evolve the technology for use of end customers. And we make sure, we lead in each of those. And so, we believe, to answer your question specifically on wireless, we believe our position in wireless, in those wireless products and markets that we are very much in the lead technology, we are lead in market share in the niches we are in. So, it’s satisfying, those considerations of us, of franchises in those specific markets as you would apply to switching and routing in data centers where we’re very well represented too. And the benefit of all this particular franchises is they all are enormously profitable and they all continue to grow.

Thank you. Our next question will come from the line of Pierre Ferragu with New Street Research. Your line is open.

Hey, Hock, and thanks a lot for taking my question. So, I’ll ask you about Computer Associates as well. So, you have demonstrated in the past a rather unmatched ability to create value from your acquisitions. And this is something you’ve mostly done in the semiconductor industry and that’s what you got, a lot of investors are used to. So, today, it’s really clear that we need to better understand the Broadcom model, how Broadcom can create so much value from acquisition and how it can apply to CA? So, in that spirit, my question to the two of you, Hock and Tom, would be, can you tell us what you guys do like nobody else? What makes you unique at integrating the business? You acquire and create value from these businesses like nobody else and in particular like private equity firms for instances would not be able to do. And then, of course, put that in the context of Computer Associate. How are you going to apply these unique capabilities to Computer Associate?

Thank you, interesting question. Let me try to address that, if I could, one of which, to start with, we don’t own private equity, by no means. Why? We know -- we understand the businesses that operates in the Broadcom very well, and we operate those businesses. We are not financial investors. The financial performance, the capital allocation that comes out, the exceptional cash flow we generate of those making those businesses very successful happens to be just the end product. We run those businesses and we run them as a group. That’s the biggest difference between us and private equity, very, very much. So, the way we see some differentiating tricks in now we identify and acquire those businesses and then integrate them into a whole, as part of Broadcom, is simply this. I think we’re very, very aware of our ecosystem, what product lines, what markets are very sustainable, very good as potential profit and growth opportunities. And we’re very focused. And that’s a key thing. We are very focused in determining what businesses make sense to invest in and what businesses we do not or should not invest in because it won’t generate the return, which is why, as I explained on my reply to the earlier question, today, Broadcom comprises 19 separate product divisions. Each of them leader in their own right in each of those niche markets they are in. And by being extremely focused on continuing to be the technology and market leader, which basically means delivering generation after generation. Because one advantage in technology is you keep, having to evolve with better and better products that your customers can use and/or ask for. As you do that you actually create more and more value to your customers. And the extension of that is…

Thank you. And our next question comes from the line and William Stein with SunTrust. Your line is open.

Hock, one of the biggest questions that we've gotten especially more recently is on the semi-cycle. Now I understand you have 19 or so franchises that you can argue are more specialized, but I think you're certainly exposed to the broader trends in the industry. And there's an expectation that we're seeing a slowdown, in particular, in China, especially potentially related to tariffs. And I'm wondering if you can offer a comment as to where you think we are in that cycle, what you see going on in that regard.

That's a very, very good question and a very timely question. And what we -- I can -- I'm not trying to look out far nor trying to basically postulate a vision here, but short -- but what we're seeing now and what we've seen recently and looking what we're seeing now is that the dynamics of the semiconductor space is constantly changing. I know that's an obvious answer. But what I mean is by different end markets. And we, in some ways, are fortunate in selling to 4, 5 end markets, very, very different end markets. And I can tell you, over the last 2 years, the behavior of all those 5 end markets are very -- had been very different. So it's hard for me to say how's the whole semiconductor industry because it does cover into a lot of spaces. And 2 -- like 1 or 2 years ago, I did say that in 2016, 2017 -- even 2017 and '16, broadband was very strong. What part of the, I guess, of service provider spending -- level of service provider spending worldwide and -- but also -- and leading to business that's kind of cyclical. It's a business I might add that's relatively flat but sustainable and cyclical. So today, as I say, broadband, as I mentioned, is not so strong anymore. Now last year -- 2 years ago, data center spending was okay. This year, 2018, it's extremely strong and continues to look good. So we see different parts of the cycle. Just like even wireless. I mean, wireless, 2 years ago, 3 years ago was great. Content was growing. Then what we've seen over the past year is smartphones literally, not just handset worldwide but smartphones, just kind of flattened out, totally flattened out and where cost becomes a concern more than that demand or innovation becomes limited, and people are now waiting for perhaps a 5G cycle before we see another uptick. And industrial -- oh, yes, automotive was moving away for a few years, drives industrial, continues to do so as we see, though we start to see definitely some slowdown from where we are, both in automotive and industrial. So you're seeing ups and downs across different segment, different end markets that's an -- which uses semiconductors. And I guess, our best saving grace here is, because we are fairly diversified, we cannot keep ourselves stable and secure on a total basis as opposed to riding any particular end market upwards are downwards.

And our next question comes from the line of John Pitzer with Crédit Suisse. Your line is open.

Hock, maybe the short way to ask my question is does this operating margin expansion story have a ceiling at some point? But I guess, the longer term or longer way to ask the question is I wonder if you can just talk a little bit about how you think about R&D. I think, oftentimes, investors get fixated on R&D as a percent of revenue and forget that at your scale, your absolute dollar spend is just enormous. But help me understand, is there something about your IP portfolio that gives it more leverage than a typical digital or SoC company? Or why are you able to drive so much more leverage out of your R&D line than many of your large peers? And again, as you answer that question, maybe you can talk about is there a ceiling to this op margin.

That's a great question, John, and I'll try to address that. And you're right. It starts with IP. We sell intellectual property except with productizing. With -- in many -- a lot of our business are semiconductors, and we sell IP embedded in silicon, is perhaps the simple best way to describe. That's what we do. We don't try to license this out. We make it into products that addresses what our end users, end customers need to make, to use or make into -- for the -- make into part of a systems. And it's that intellectual property that drives the technology evolution because we keep feeding that machine. We keep enhancing, innovating on those technologies in any particular markets we're in. And as I mentioned, we have 19 of those markets. In each of them, one -- it's -- we behave very commonly. We have a team of people, and in many cases, we -- or in most cases, I would add, we have the best engineers in the world, architects and engineers in the world in each area -- in the space they are in. We are among the best. And many of these -- and these guys, the other side to IP, they have IP they have developed over the years and innovate to the next better thing. And we keep doing that. And the customers love to have this product because it makes them successful. It makes them more productive. It makes them do things that otherwise they can't do. And when you do that with each evolving technology, each evolving generation of technology, you basically get a higher value added to your product. Always do because you give your customer more value. You get something more for it. I'll give you an example, right?…

Thank you. Our next question comes from the line of Ross Seymore with Deutsche Bank. Your line is open.

Hock, I wanted to focus on your wired business, both in the near term and the long term. In the near term, you did a great job of explaining some of the puts and takes between that 60-40 split of the fast-growing and slower-growing businesses. But to the extent it's 45% of your business today, and we look forward longer-term, how should we think about the growth rates of that 60-40, and what does it mean to the profitability of the Company, either on the gross or operating margin line as the growth rates seem to be so different between those 2 sub-segments?

Well, Ross, thanks for asking that too. But what you say is true right now. In 2016, I loved broadband. It was an on up-cycle. If you recall, there was the Summer Olympics floating around. Everybody was signing up for cable, cable access. So we were booming. That time paid. That thing outperformed data centers, networking, that is. Today, the cycle turned around. We look at broadband and say, "Man, this thing is dragging me." It's not. When the up-cycle happens as we fully expect within the next 12 months also, you'll be great again. So that's one of the interesting things about it, is looking at, say, even wired or even wireless. Every one of this -- a lot of these markets' growth has their ups and downs, and especially if you look at a quarter and much less annually. Quarterly, even worse. What we have to keep realizing is these are all technology-driven applications and market-driven as better and better, more innovative technology comes in. It keeps expanding, some at a slower pace than others, but what it does is it adopts new technology, and which allows us to keep adding more value as we progress through it, even though it goes through its ups and downs. And the key thing to all this is sustainability. These are all very sustainable end markets. The product we see today may be much better than the product in this end market we saw 5 years ago, and the product 5 years from now will be much better than the product we see today. But believe me, the end use continues.

Thank you. Our next question comes from the line of Craig Hettenbach with Morgan Stanley. Your line is open.

I have a question for wireless RF. I mean, you play mostly at the high end of the market. Interesting developments in China, when I think of some of the local brands there, some impressive specs coming out and as they start to ramp the volumes. So I just wanted to know if that potentially could change your opportunity set in RF in the China market over time.

A very interesting question, and it is, again, part of the whole franchise model. And then, yes, because again, in the case of wireless, we have very unique technology. We have very, very differentiated technology that allows us to produce very high-performance products in those smartphones. And so far, it's been the super high-end smartphones that tends to use our products. And I could see a situation where, especially with 5G coming into the mix, with all these difficult bands showing up, where 5G, you start running higher than 3 gigahertz spectrum bandwidth. You start to meet better and better RF components, especially in filtering, very much so in filtering, and we could see that being required across the board in many next-phase or next-generation 5G phones. And we can see that happening, in which case then, it starts to expand beyond just high-end phones, and you're exactly right in that regard. It has happened before, a few years ago, when there were certain bands that were so critical, it can only be done using FBAR. Very difficult FBAR technology, and for a while, that was pretty cool.

Thank you. And our next question comes from the line of Blayne Curtis with Barclays. Your line is open.

I just want to follow up on that wireless. You were talking about cycles and some years better than others. When you look at wireless, cellular and then WiFi is 2 components. Just kind of curious, as you look out, you mentioned 5G. Maybe kind of what's the content story between now and a couple of years from now, when 5G will be a majority? And then on the WiFi side, can you just talk about timing of that?

Okay. You -- and so actually, 2 questions you're asking here, so let me try to address them separately. WiFi, in many ways, is a more stable, predictable evolution of the technology trends. And today, very much so, everybody uses the standard, WiFi standard called 802.11ac, C as in China, and that's great. It's definitely an improvement from what it used to be 5 years or 10 years ago. But we have a new technology, a new protocol coming in called 802.11ax, which I may have commented on a couple of times in my prepared remarks. What ax does is, in a nutshell, it increases, in layman's language, the bandwidth. Huge. You can imagine easily running data stream wirelessly from your handsets. Upwards and uplink and downlink weigh over 1 gigabit per second, even 2 gigabits per second. You get carried away. But what's even more interesting is it allows for multiple users simultaneously, which is something that's always been tricky. And it requires a lot of technology, hardware and software. And we are in the lead in doing it, as I indicated. We are the first out with our product, they're working, we're designing, and we started launching it with multiple partners starting October next month. By the way, this year, starting with the retail routers and going on to the enterprise access points and then operators by early next year. So it's a big thing, 802.11ax, and I bet you in the spring, you will find at least one big handset maker coming out big-time to push 802.11ax. And our chips will be right in those flagship phones. But -- so it's more predictable, and our technology is so strong. I have to say that we see ourselves in the road map of our key customers over the…

Thank you. Our next question comes from the line of Chris Caso with Raymond James. Your line is open.

Just a follow-up question with regard to the wireless and some of the prepared comments that you made. You talked about expectations will return to double-digit wireless growth next year. You also talked about being in a position to win back some of the FBAR business. Can you reconcile those 2 comments? And is one dependent on the other? For the double-digit growth you're expecting next year, what are the assumptions behind that?

Chris, it's Tom. Let me just clarify the prepared remarks. What we were referring to is double-digit growth in 2020 off the back of a dip in 2019. And just also to clarify, we do feel really good about the prospects of winning back the business that we discussed, that we had lost in the current generation phone, which would impact the very back half of '19, but really would have an influence on the 2020 growth rate we discussed.

Thank you. Our next question comes from the line of Harsh Kumar with Piper Jaffray. Your line is open.

The big question we're getting is what is Broadcom's expectation running a software company? This is the first one for you guys in this area. Could you maybe talk about some of the strengths and challenges you see and maybe some of the plan around running this business? And then also, for the non-mainframe business, what kind of margin opportunity do you expect to see from, for example, enterprise solutions?

Well, I love this question. I'm almost tempted to tell you, hello, the same reason we've put together a bunch of businesses in semiconductor, what we call semiconductor solutions. On one extreme semiconductor solution, I am pulling simple hardware semiconductors, pure hardware analog components. To the extreme, it's not even silicon, in some cases, it's nanotechnology, it's indium phosphide, gallium arsenide, as in lasers, to the more well-known, well-recognized silicon SoCs, silicon on a chip there we built our routers and switches, and deep-learning chips on, with a lot of software, by the way on this thing, lots of software. I have -- in our networking team I have as many software engineers as I have hardware engineers, silicon solution engineers. In our video delivery business, video, which is basically a set-top box with cable modem, I have more software engineers because there are tons of different kinds of software that goes into a set-top box chip thus compared to hardware engineers. We understand software. CA, you're right, is all software. But a set-top box is, to put a number, over 60% software. And if I have to look at the switch, I can make the switch as simple, programmable and install software-defined networks and write a lot of software specs to program this, and that's 70% software, 30% hardware. Or I could hard-code chips as I do in certain other versions of my networking business, which are typically lower-end switches. And I would say I have 80% hardware and 20%, 30% software. So I go -- it varies across a lot of spectrum. One thing that's common is technology. It's technology solutions you provide to your customers, who cannot operate very productively, very efficiently, they don't sometimes operate at all without that, and it's technology solutions that evolve over time and your ability to keep up with customer needs over time. We're very good at managing that. We are very good at understanding how to monetize intellectual property in technology. I think that's a common thing we have.

Thank you. Our next question comes from the line of Matt Ramsay with Cowen. Your line is open.

I think it would be helpful for either one of you guys to talk a little bit about the M&A philosophy going forward. I think, Tom, you did an excellent job in sort of reiterating the capital return policy. It sort of struck me on a lot of the questions that we got from investors were it was sort of a surprise at the size of the CA deal, given some of the prior commentary around maybe focusing on smaller M&A deals. So I just kind of open it up and I'd love to hear some philosophy, conversation about how you're thinking about maybe verticals or size or any of those things, if there's anything that's off limits going forward, or we should just think about the capital return policy only and nothing's really off the table in terms of M&A. And I'll just open it up at that.

Good question, Matt. I think that the important message is not much has changed. The business model and what we think drives the returns of the acquisitions that we do is very consistent. And we understand and appreciate that CA was a bit of a surprise and certainly larger than maybe what many people expected, but the reality is it was the right deal for us at the right time as we think about how to grow the earnings base of the Company and how to drive value for shareholders over time. And if you think back, and this follows up on Harsh's question a minute ago, when we bought LSI, we were getting into what you could argue as a very different business. We had a largely mobile business at Avago, RF business that's sustained today has grown organically very rapidly, but we're getting into businesses that included rechannel SoCs, preamps for hard disk drives. We were getting into enterprise storage and SaaS connectivity, serving -- delivering to the server market. And these were all businesses that we frankly didn't know very well, but it was the characteristics of those businesses, just to follow in on what Hock discussed in terms of the intellectual property, the barriers to entry, the sustainability of the businesses, and by focusing on those businesses, that's what allowed us to drive the returns we've seen. And we have obviously expanded from there. We've done smaller transactions, but we've also more recently done Brocade. Clue, that's a systems business. It's largely software. It has an end-user sales force. It's opened our eyes to end customers and what we can do with those end customers. But more importantly, it's proven to us that we can manage these businesses. The performance of Brocade over the last year, and we've obviously been quite familiar with the business for more than that time period, has been quite exceptional. And so CA is really an extension of a strategy that we've been pursuing for a number of years and has driven a tremendous amount of value for shareholders. So we look to continue to do that as a way to drive value. Obviously, we're going to deliver on the dividend, which is really important to us. But we have a lot of financial flexibility off the back of significant and substantial operating cash flows to continue to do buybacks and to do accretive M&A, and we see opportunities going forward to do that.

Thank you. And our next question will come from the line of Edward Snyder with Charter Equity Research. Your line is open.

One of the things that struck me though in your initial comments, when you were talking about your new customer base with see CA because they do open up a lot of clients that you don't have with the semiconductor business. You were talking about porting in some of your networking and compute solutions, storage solutions to them. But right now, you're selling semiconductors, and a number of your big customers, you mentioned them, Google, Facebook or Google, Amazon, Microsoft, build their own boxes using your silicon. I would imagine, most of the CA's customers do not do this. So how are you going to port your -- how do you think you could port your semiconductor products to these new customers without getting into boxes? Or are you thinking about that? Or do you think they will start up such endeavors to start porting through? So I guess I don't understand how your existing products are going to be ported to these new clients without some sort of intermediary or white box guy or something. Maybe I'm a little bit confused there, but if you could explain that, I would appreciate it.

Sure. I think that's a very, very insightful question you came out with, and you're right 100%. One, we're not interested in going to the boxes, you got that right, or systems. We don't need to do that. But we have the key ingredients. We have the chips, the engine. So you take a box, be it in the industry that you're out to, any of those things. Where -- and we have the software. Or if you want to sum up all of these end users now, and you're probably aware of that and to some extent, some of the big operators now are starting to want to build their own data centers and they have come to us and asked us to enable them to build their own data centers. And what -- that's very similar. And these guys are very, very aware of how the cloud guy is doing. The cloud guys use our own silicon engine -- our own merchant silicon. In many cases, some of our initial -- our software, SDK, by -- in many cases, they even write their own software and they then go to ODMs, the ODMs in Taiwan, in China, anywhere else, to put a box to build a system, a box. We have to enable that. Obviously, we have to. And the cloud guys do it. There's no reason why an operator like AT&T with Domain 2.0 cannot and is, in fact, executing on that basis or any other large enterprise users who build -- who had to build out on their own scale fairly substantial data centers, why they can't even do that on their own because as Tom had said, the core IP, the core technology, which is the engine, the software. Everything else ties together, and there are lots of ODMs out there. You call that white boxes, I believe, and they have a choice of doing that or continuing to buy from their traditional sources. What we are able to do now with our direct access to CA customers is establish strategic and strong engagements with those end users, and substantial end-user enterprises or end users, who would want to start doing it themselves in order to not just do it at low economics, but in order to access directly the latest, call it, leading-edge silicon software products, technology, which will enable them to build data centers just as leading-edge as what's available in the cloud. But we have seen that requirement, that request coming in, and we are basically responding to it. This is not a pipe dream.

Thank you. Our last question will come from the line of Romit Shah with Nomura Instinet. Your line is open.

I definitely appreciate that you guys think very strategically about the deals you do, but if I just go back and think about your M&A track record over the last several years, it just struck me as being financial deals, first and foremost. And Hock, the playbook has been, at least my impression has been, you'd slash SG&A by a significant amount, you'd cut R&D while basically raising prices at the same time. And CA, given the kind of legacy nature of their technology, has a lot of people believing that this business may turn out to not be as sticky if you take the same approach. So could you just comment on that, please?

Absolutely. That's a question that's wrong on so many fronts, I don't know where to begin. Let me start, let me try. Number one, we acquire -- we have a history of acquisitions and integrating very, very well. Those are not financial deals. They end up, as I say, as great financial returns. They're not -- we operate them under a single umbrella. We operate them, I hate to say, very, very well, but we also operate them very, very focused. And when you're focused, as I said before, you don't overinvest in R&D. When you're focused, you don't overinvest in even selling. When you run your company in a business model that is simple, you don't need a huge amount of SG&A. As already mentioned, it's not about cutting SG&A, it's about simplifying a business process with very strong -- a portfolio of very strong businesses, where you focus your spending on R&D to enable you to keep being ahead of the pack. And that's really our business -- our model, it's a business model and that we have executed over the last 6 years through multiple acquisitions. And it's also, as I mentioned in an earlier response, how well we integrate into the model, which ties to being very focused on what you pick as core businesses you want to keep investing in and divesting. You can't cut a business that you don't have. Businesses that you do not see as being sustainable, part of it being sustainable is really a chance of them in franchise. When we buy companies over the last 5, 6 years, just as many companies and businesses we are in. If you look at the finer print and we have that data, we divest as many businesses out there. We just let it go because those are businesses that we believe are not sustainable, are not strong, are commoditized and where you don't have an advantage for whatever reasons that comes into play. So in that sense, you might call that financial. I don't. I call it a very strategic focus on businesses you can win. And that's how we look at even looking towards CA, which is an interesting part of what you say because, Romit, the mainframe business is very alive and well. Investments are still continuing in the mainframe business. And to put it in simple terms, transactions, online transactions, a lot of them in the largest enterprises in the world cannot run without mainframe, with hardware or the software tools that drive it. So that's basically all I say to that. But obviously, ours is an operating model and a business model, and the financials is what comes out of a very strong, sustainable and secure business model.

Okay. Thank you, everybody, for participating in today's earnings call.

Thank you.

That concludes Broadcom's conference call for today. You may now disconnect.