Ladies and gentlemen, thank you for standing by, and welcome to Marvell's First Quarter Fiscal Year 2021 Earnings Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker; Vice President of Investor Relations, Ashish Saran. Sir, please go ahead.

Thank you, and good afternoon, everyone. Welcome to Marvell's first quarter fiscal year 2021 earnings call. Joining me today are Matt Murphy, Marvell's President and CEO; and Jean Hu, our CFO. I would like to remind everyone that certain comments today may include forward-looking statements, which are subject to significant risks and uncertainties that could cause our actual results to differ materially from management's current expectations. Please review the cautionary statements and risk factors contained in our earnings press release, which we filed with the SEC today and posted on our website, as well as our most recent 10-K and 10-Q filings. We do not intend to update our forward-looking statements. During our call today, we will refer to certain non-GAAP financial measures. A reconciliation between our GAAP and non-GAAP financial measures is available on our website in the Investor Relations section. With that, I'll turn the call over to Matt for his comments on our performance. Matt?

Thanks. Ashish and good afternoon everyone. During the first quarter of fiscal 2021 we delivered strong financial results and achieved $694 million in revenue, $14 million above the midpoint of guidance. As you may recall, our revenue guidance for the first quarter included an assumption for a 5% headwind from COVID-19. We did in fact experienced some impact on revenue from COVID-19-related issues but stronger-than-expected demand from our data center and 5G infrastructure end markets and our networking business drove consolidated company revenue above the midpoint. Compared to our assumptions when we provided our revenue guidance for the first quarter, the impact of COVID-19 turned out to be greater than expected in our storage business and lower than expected in our networking business. Our GAAP loss per share was $0.17. Our non-GAAP earnings per share was $0.18, above the high end of our guidance range, driven by higher revenue and tight OpEx control. On a sequential basis revenue declined by 3%. However, compared to fourth quarter results, adjusted for the divestiture of Wi-Fi, revenue for the ongoing business was actually flat on a sequential basis, a very solid result under current conditions, and in what is typically a seasonally weak quarter. I'm extremely pleased with our team's ability to deliver great results despite the massive disruption from the COVID-19 pandemic. The vast majority of our employees have been working from home since early March, earlier than most official shelter-in-place orders were announced, as the health and welfare of our employees and their families was our first priority. Our IT team quickly jumped into action to provide secure, remote access for our 5,000 plus employees. Our Worldwide Operations Group battled through a number of supply chain challenges and met the upside in demand in our networking business. Since the start of…

Thanks, Matt and good afternoon everyone. I'll start with a review of our financial results for the first quarter and then provide our current outlook for the second quarter of fiscal 2021. Revenue in the first quarter was $694 million above the middle point of our guidance. Networking represented 57% of our revenue in the first quarter with storage contributing 37%. Revenue from other accounted for 6% of our revenue as we maintain this business consists of products such as print solutions and application processors. As we have stopped investing, so we expect they will continue to decline over time. Our guidance for the second quarter anticipate an approximately 20% sequential decline in revenue for these products. GAAP gross margin was 47.1%, which includes the amortization of both Aquantia and Avera inventory step-up cost. Non-GAAP gross margin was 62.8% of revenue and it reflects the change in product mix compared to our expectations, as Matt discussed earlier. GAAP operating expenses were $423 million. Non-GAAP operating expenses were $300 million, lower than expected, primarily because of our continued focus on OpEx management and the lower travel expenses due to the COVID -19 impact. I'm pleased that we were able to get to our target for non-GAAP operating expenses three quarters than earlier than expected. And we currently intend to manage OpEx at this level through the rest of the fiscal year. GAAP operating loss was $96 million. Non-GAAP operating profit was $136 million or 19.6% of revenue. For the first quarter GAAP loss per diluted share was $0.17. Non-GAAP income per diluted share was $0.18 above the high end of our guidance range. Now turning to our balance sheet, during the quarter, cash flow from operations was $176 million. We returned $65 million to shareholders, through 25 million in share repurchases,…

[Operator Instructions] Our first question comes from the line of Timothy Arcuri of UBS. Your question please.

Thanks a lot. In the release you had mentioned that you had some impact for the trade -- for what's happening in trade. So Jean, can you just talk about that and talk about maybe what the impact is and maybe whether there is a longer term opportunity, maybe now that High Silicon is going to be quite restricted in sort of what they can build. Will there be an opportunity for you there? And, I guess also -- I just wanted to ask whether you have an update on the $600 million incremental 5G opportunity. Sounds like it's going to be quite a bit bigger than that, maybe it's big as a $1 billion. So I'm wondering if you can comment on that. Thanks.

Yes, hi, Tim. Thank you. Yes, on the trade impact. I think the impact from Huawei it has happened in the past. So we -- it's already impacted our revenue last year. We actually almost have no Huawei revenue anymore going forward. On the other customers, right now based on our assessment we don't see additional impact. And I think the way to think about it is there -- it's uncertain. But right now we don't see other impact. I'll let Matt answer the 5G question.

Sure, yes. And Tim just to clarify on the trade side, yes, as Jean mentioned we felt primarily the brunt of that impact, about a year ago when the initial restrictions were put in place. And so we've worked through that issue. I think the other thing you may be asking is, what's the kind of overall picture if there's an impact to that particular customer in the 5G space and will other vendors take share, will that be a tailwind for Marvell? And the answer to that is in our current base case assumption we're assuming no share shifts. We have strong position at the other four, but certainly to the extent that there are SHARE movements within the 5G players that would be to the benefit of other customers that we supply, that would be a good thing for us. Related to that was your was your second part of the question, which was on the long-term opportunity. Yes, it's actually a little bit larger. It was $600 million when we standalone Marvell, and then when we did the acquisition of Avera, we added another $150 million of run rate business coming over. So, that really framed the whole opportunity at $750 million. We still feel very good about that as you heard in my prepared remarks, as well as even some of the comments from last quarter, we continue to have very strong design win momentum there and content increase at a number of the key players. And we continue to be heavily engaged and we're still in the early stages of this and we hope to update that figure at some point in the future, but just clearly based on what we've won already there is $750 million that's in the pipeline. Probably a little bit more if you look at the Nokia partnership that we announced last quarter. So that's very much on track. Thanks for the question by the way.

Okay, understood, Matt. Thanks.

Thank you. Our next question comes from the line of Gary Mobley of Wells Fargo Securities. Your line is open.

Hey, everyone. Good afternoon. Congrats on a start to -- a good start to the fiscal year. Want to start out by asking about the strength that you've been seeing on the networking side in particular, 5G and cloud as well. And so clearly we've seen some good demand trends there, and I'm just curious to hear your perspective on where we might sit with respect to some of those customers maybe adding some capacity ahead of demand or are they playing catch up and trying to get a sense of whether or not there might be some carry through on the strength in the second half of the year.

Sure, yes, Gary, this is Matt. I'll take that. So we're off to a great start in our first quarter. As I indicated last quarter, there was -- we had a lot of momentum in our business exiting the year. I would also give you a higher level framework to start with, which is remember that the overall semiconductor industry in 2019 went through the third largest down cycle we've seen in the last 25 years, primarily on the back of the trade tensions. And so coming into calendar '20, just kind of broadly speaking inventories were low in the customer base and supply chain, certainly even at Marvell our own inventories through our channel and our customers were low. And so the demand that we had seen exiting the year even before COVID-19 hit has continued and the drivers we see in our business are, we think very sustainable. Certainly in the two areas that you mentioned, we're at the early stages of 5G and you've got the China market, that is expecting to have a very robust demand this year. That's all very sort of publicly announced, and we're at the beginning stages of that. We expect other regions to continue to follow, which would be very good for our customers. On the cloud side I think that demand trend is certainly here to stay. And while there has been some talk about potential digestion and things of that nature, at least from our lens as Marvell, we have very unique product cycles that we mentioned, both on our Smart NICs are brand new LiquidIO III SmartNIC product which is ramping very strongly. Our LiquidSecurity products, storage, I think there is a strong view on the nearline side that, that will be a very good year. So overall, at least from Marvell, we think those are very sustainable. Last comment I would make is in Q1 we had the additional benefit of some very good enterprise strength, primarily and enterprise data center and that helped us as well. So I think we've got a nice setup of various moving pieces, but certainly from a sustainability standpoint, we see 5G and Cloud really driving our business this year, through the remainder of the year.

Okay. And the follow-up question I want to ask about China and 5G. You mentioned some success and market share gains for some of your customers in that region, based on their tender activity and what not. Why don't you anticipate a more meaningful contribution for that specific region?

Well, it's--- in -- a little bit started and helped us even in the first quarter is that again, we'll see more in Q2 with really we see a very, very strong Q3, our Q3 for that particular business. And I would say that's really when the volume starts. So we're still in the early stages of that build with some of that comprehended in our Q2, but a much stronger outlook for Q3 and beyond.

Got you. I appreciate it, thanks.

Thank you. Our next question comes from the line of CJ Muse of Evercore. Your line is open.

Yes, good afternoon and thank you for taking the question. I guess another question on China. Could you walk through your infrastructure exposure there both direct and through Avera and potentially additional opportunities outside of Huawei? Thank you.

Sure. Hey CJ, I'll start with that and then I'll ask Jean to add if she'd like to. So couple of things to note, we definitely have indigenous China revenue. We -- prior to the entity list issues Huawei was our number one customer in China and I think that's been very well-telegraphed what's going on there. As you heard my commentary, we've ended up gaining some share at their biggest competitor in China. And so that's going to service really well in the 5G ramp. And then additionally we supply a number of other OEMs. We haven't broken that number out. But what I'd say is if you look at our historical Qs, they just have shipped to numbers, now like 50%, 47% and that's obviously way overstated because that reflects primarily contract manufacturing activity in the region. So, we've got I think exposure in the right places there both -- in 5G as well as some of the key enterprise OEMs there, and then we have some distribution as well. So I think our business is reasonably diversified outside of the first customer I mentioned.

Thank you.

Thanks, CJ. Can we have the next question, please?

Our next question comes from the line of Vivek Arya of Bank of America. Your line is open.

Thanks for taking my question and congratulations on the improving growth and the execution. Matt, just a clarification, I think you started to mention something about networking continuing growth in Q3. I was wondering if you could elaborate on that. And then the question really is, have you seen any double ordering or excess inventory or any abnormal orders from any of your customers in cloud or data center or the China markets, because I think we conceptually get that certain parts of your customer base are strong, but just given all the macro issues, I think investors are naturally worried about anything abnormal that might be going on because of all the trade concerns that that are ongoing. So any color in terms of actual consumption of your products I think would be very helpful, thank you.

Yes, great. Let me start with Q3 and then I'll move to the over-ordering question as well. So on Q3, just to be clear at the highest level, what I said in my prepared remarks, was that we see -- we do see overall company revenue increasing from Q2 to Q3. At this point given the visibility we have. That's overall company and that's driven by primarily our networking business, which is 5G and Cloud, but also by since custom SSD opportunity I mentioned. And so we see strength actually beyond Q2, both in our networking business and in our storage business. On the subject of double ordering and the concerns out there, look, I a bit on this rodeo for a while. I've seen various shocks to the system. And then the resultant supply-demand imbalances. And I'm very acutely sensitive to those, in watching those like a hawk. From our point of view, I think the interesting dynamic on this one, Vivek, as I mentioned earlier is that the industry exiting '19 was coming out of a very severe downturn where customer inventory levels were low. And so, certainly, there has been, -- there has been a -- now they probably over did it and I think even certainly without COVID-19, I think we were going to see even probably stronger demand, as we indicated for last quarter. So that's one part of the set up. And the second is, we've. I mean we've, at least in Marvell, we really over-indexed on this in terms of spending time on this matter, and trying to look at all the customer ordering patterns. Does their market share add up to more than 100% and how much do we think is buffer versus not. And the end conclusion is I'm very comfortable…

Thank you.

Thanks.

Thank you. Our next question comes from Atif Malik of Citi. Your line is open.

Thank you for taking my question and good job on results and guide. Jean. I have a question that you have talked about Avera plus Aquantia minus wireless adding about $100 million to fiscal 21 sales in the past, I don't expect you to break out these acquisitions anymore, but can you just talk about if you're running above this run rate currently with Aquantia and Avera.

Yes, so we're very pleased with both acquisitions. I think last earnings call, we said that both Aquantia and Avera have been on track with our expectations, definitely through this year. We think that they are going to perform better than our expectations, just based on the backlog of the order pattern and everything. So overall, very, very pleased with the two acquisitions.

Yes, and I'll just add to back that up. We had a very strong Q4 and Q1. And so the six months that we've owned both of them, we've gained a lot of confidence that not only are those the right acquisitions to do, but the level of top line contribution was going to be not only right where we thought, but probably given all the dynamics I mentioned, with strength in cloud and strength in 5G that is benefiting certainly Avera. And then on Aquantia, as I mentioned, we've had very good enterprise strength in some of these segments. So we do see both of those probably performing better than we had indicated back at the time of announcement for calendar '20.

Thanks.

Thanks.

Thank you. Our next question comes from Harlan Sur of JPMorgan. Please go ahead.

Good afternoon and great job on the quarterly execution. On your DIY SSD controller with your lead customer, good to see the initial ramp this quarter. Given that this is a semi-custom ship, utilizing the vast majority of your I, I assume that you're the sole supplier of this SSD controller. So in other words, your customer may be using different NAND memory suppliers, but they will be using your controller solution irrespective, is my assumption correct, because I'm just trying to size opportunity because your customer's platforms here has a historical cadence of ramping anywhere from 5 million to 7 million units in the first year to around 16 million to 20 million units by year three. So pretty substantial opportunity if you guys are the sole supplier.

Yes.

Harlan, you are right. Yes.

I'll take this, Jean, and then you can add. So yes, no, you're right and in fact, the way to think about it is any -- all of these DIY opportunities are by design proprietary and sole source in nature. And they -- to your point, they typically incorporate pretty substantial and rich IP from Marvell. And then as a result of that we're able to command better ASPs and also add an additional functionality above and beyond what you would sort of normally think of a standard SSD controller is being valued at. So, I think it's a great combination of -- in any of these DIY efforts that we have going on and there are several of them where we have very close collaboration with the OEM to find really something that's very special and unique for what they need. And then, the result of that is they can get pretty significant performance benefits across a wide variety of applications, when it comes to flash-based storage. So yes, proprietary sole-source and on track to ramp.

Great job in the execution.

Yes, I'll just add, right. Matt said earlier, we already started production in Q2, which is much earlier than we expected. And then Q3 certainly that's the major ramp. It's going to happen.

Great, thanks for the insights.

Thanks, Harlan.

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

Hi guys, thanks for letting me ask a question. Matt, I want to go back to the cloud theme that you talked about in your script. And kind of clarification on a question, that greater than 10% number that you talked about, which is up a lot year-over-year, just roughly how is that split between the two segments, storage and networking and more importantly going forward, how do you expect that to grow? Customers can be very, very lumpy, especially on what I would assume would be your networking side of the business. It could be a little bit more steady on the storage side, but give us an idea of how we should think about monitoring the growth and kind of the lumpiness of that going forward.

Sure. Yes, thanks for the question. Ross and I'm glad you brought it up, I mean we definitely wanted to spend time on it. I think if you look at the last year or so, we've been very focused and certainly from an investor point of view, the demand for questions and information and the opportunity for Marvell at least has really been framed around 5G. As I mentioned that continues to be not only a great opportunity, we're actually starting to ship. And so it's nice to see the results now catching up with the thesis. So very pleased about that. And so the thing that's really come together though in parallel, as we did the various portfolio moves last year and even going back farther kind of the Marvell organic investments that we've made, we have been very focused on cloud and hyperscale. We do see that as a big SAM and a big opportunity. And so what's -- we thought it was an appropriate time to talk about that and break it out because a lot of things have come together in that business is now ramping. And it's actually strong in both our networking and storage side and we see both of those opportunities as being quite significant. That's excluding ARM server. I mean ARM server, you just dump that one on top of it, but even ex ARM server, we see the SAM for our networking and storage products, and now the combined company with all the moves we've made as being an equivalently large opportunity as 5G. And while cloud spend can be lumpy, we certainly have that in other markets. The carrier market isn't exactly the hallmark of stability. That thing certainly can move around as everybody that's been involved in base stations…

Thanks, Ross. Can we have the next question please?

Yes, sir. Our next question comes from the line of Blayne Curtis of Barclays. Please go ahead.

Hey guys, thanks for taking my question. I was just curious, Matt, you provided a wider range, and kind of curious how you're thinking about that. Clearly the factory shutdown did impact you in storage, it seems like most factories are kind of back on line. So it seems like some of the headwinds or tailwinds, I'm kind of curious what you're thinking about. On the other side of the coin there as you look out into Q2 as well. At the end of the year.

So, I'll give you both sides of the coin. I think on the one hand you could take the argument you just said, which is what we see today, by the way, that things appear to be stabilizing as factories are coming online and countries are reopening and so forth. At the same time though, I mean let's just take a big step back right? The whole world and environment is highly uncertain and the rate at which thing hit us, I think caught everybody off guard and so I wouldn't read too much into it other than we widened the range last quarter. And just out of the abundance of caution, there is no reason to tighten at this point, but we don't see anything -- differently than you mentioned at the beginning. I mean, we -- it seems like we've got our demand -- we've got our demand drivers. We have seen strong orders. We've got good backlog position those types of things. So we have confidence in our business, but it's really just around the broader level uncertainty and I think our range by the way is very consistent actually with a lot of other semi hears or I we'll probably leave it a little bit wider until we -- the world seems to stabilize.

Thanks for that.

Yes.

Thank you. Our next question comes from John Pitzer of Credit Suisse. Please go ahead.

Yes, hi guys, congratulations on the results. Matt, maybe another way to ask Blayne's question, you guys clearly have a different go-to market model than a lot of other semi more direct less distribution and at least relative to some of the broad-based. You have a lot fewer customers, but I'm just kind of curious as I look towards the guide for July, it seems like a lot of your peers significantly discounted their bookings and backlog trends when they gave guide guidance for June, July. Just trying to take a level of conservatism. I'm just wondering if you can give us any color on how you constructed this guide relative just to all the backdrop of the macro uncertainty. And as an example some companies have guided to 100% backlog coverage where they normally guide to 75% to 80% backlog coverage.

Yes. Sure, John. Yes, happy to answer that. And I have seen that commentary, and I think it does have a lot to do with what you mentioned. In particular, probably the analog-mixed-signal guys who have a much broader customer set, highly distribution-oriented consumer and industrial type of exposure in automotive as well, where those types of market seem to have been hit very, very hard. I think our market mix is clearly benefiting us at this point in our strategy that we really have been driving for the last several years, I think is become extremely pertinent in this new world. And so I think we're quite different than maybe some of the other broader based folks who -- I don't blame them for being extremely conservative. And I understand those dynamics, that they may face, but I'd say with us setting in. I mean we also --through the mix changes, because we're not selling as much into consumer anymore. As an example, the lead times that we get are solid. Our terms and conditions are quite solid. The backlog coverage we get is, especially with Avera coming in and think of it as Avera coming in and Aquantia and Wi-Fi going out, and you swap that sort of consumer for infrastructure you're just getting a much better backlog position. And on top of that, we've got the channel quite lean and we're also carrying some delinquency higher than we normally do. And so that gives which is -- which means we've got -- we've got backlog that's out in Q3 that customers would like us to ship into Q2 and that has increased relative to where we normally run it. And so I think that -- those are some of the other data points, John, that give us give us comfort in the guide as well as just our starting backlog position is has been higher than most quarters since we've been here.

Perfect. Great color. Thanks.

Thank you. Our next question comes from Christopher Rolland of Susquehanna. Your line is open.

Thanks for the question. Matt, in your prepared comments you spoke about Jensen and the DPU and you guys were really pioneers in smart tech -- SmartNIC technology with LiquidIO and Cavium there and you called that out specifically as a driver this quarter. I know Cavium used to have one key partner there that eventually went internal with their own development, but perhaps you can talk about this renewed interest, how broad, is it, what kind of levels are we at, are we close to old levels and is it going to be sustainable in your opinion in this time?

Yes, great, thanks Chris. Great question. So first point on DPU I thought that was really, really well done by our colleagues over at NVIDIA and it's certainly resonated. I think that was the clearest way that I've seen anybody explain what these products do and I think the market in general has gotten confused over with the SmartNIC is on a NIC kind of a commodity thing and it's sort like fungible and liquid and it just -- I think. -- this is a much crisper way to describe it. And so and it certainly fits as you point out, kind of a key IP and a key area that the Cavium really pioneered. And so with respect to our smart NIC offerings that -- I think kind of it's consistent with the question that Ross asked. We spent a lot of time talking about 5G last year but very quietly, we've been continuing those roadmaps. And so that is ramping, it's highly sustainable. We -- and it's -- and we're engaged with multiple OEMs between the ramps that we're getting plus new opportunities and engagements and I actually think we're in, probably one of the best positions of any semiconductor company to truly tailor and optimize solutions based around the smart NIC type of architecture. Because we have all the pieces right. We have the latest generation OCTEON core which is highly programmable, we have network connectivity in Ethernet. We have security, we have access and development in investment in the most advanced node process technologies. And we have ASIC capability, which is a trend that we see as well where some of the large hyperscalers are just saying, let's go skip over a LiquidIO type of solution. Let's go directly to our very special thing that we want and we think we can provide a similar type of solution there just like we do in our co-partner model on baseband where we contribute a big chunk of the IP. The customer can also contribute, we stitch it together, they get exactly what they want. We can do it very quickly, without the customer having to hire a gigantic design team and take three years. So, I think it's a very compelling opportunity, Chris, both on the current ramps we're seeing on the latest generation products as well as our roadmap and the ability to customize and drive this product area forward. Thanks for the question.

Thanks, Matt. Congrats on the quarter.

Yes, thanks. See you.

Thank you. Our next question comes from Joe Moore of Morgan Stanley. Your question please.

Great, thank you. You talked about Thunder and the enthusiasm that you have there. Can you talk a little bit about like some -- what are the key workloads that you're addressing and is this. I think at one point there was the thought that this sort of is a replacement for Intel on a broad base of applications and versus something that's kind of an accelerant for a few key workloads. Like what's just a framework of how you're thinking of that now over the next three to five years.

Sure, Joe. Yes, I think the, the world, the whole thunder investment that we're making has continued to be really focused down. I mean if you went back to sort of pre-acquisition of caveat I think there was a view that said there is a very large market for this, we can sell to a whole ton of customers across a whole bunch of different applications and serve a number of workloads and go head to head with more general-purpose type x86. And really the direction that we've taken is to really focus the product down and tailor it really around a handful of key vendor -- key customers in the cloud area, and within that as an example in our announcement publicly we had with Microsoft, where we are the first property that we're [ph] in is in Azure storage. And the way we developed and defined the product was really ideal for that application but we can certainly do a high level of customization for these hyperscalers because they know exactly what they need. And so we do see opportunities in expanding in the more compute-oriented applications and workloads but that's sort of in the future. But again, I'd sort of transition the Thunder story just to bridge everybody from. hey, it's broad based, it's going to go to take on x86 and take on the world across all kinds of applications to really the evolution over the last few years under a more focused effort to really focus around the hyperscale opportunity and tailor it specifically to those customers and what they need.

Great, thank you.

Yes, thanks.

Thank you. Your next question comes from the line of Tore Svanberg of Stifel. Your question please.

Yes, thank you. Congratulations on the results on the -- the new branding. I really liked the logo. Not to sort of steal your thunder from your Analyst Day in October, but you talked about in the automotive space, you kind of see the zonal architecture, that's very similar in the sort of enterprise networking world, I was just wondering how that's going to play out. Will you be working with networking companies here or will you be working with the hyperscale guys or the auto companies. So just trying to get a head start on how that whole world is going to look like. Thanks.

Yes, great question. Here's what I'd say, it's very much with the automotive customers themselves and it's very much with the OEMs themselves. And a little bit like if you go back in time, the automotive OEMs, probably in the mid-2,000 to kind of 2010 era started taking a lot more control over their semiconductor strategies and that was really generally around things like infotainment, EV, ADAS and you all of a sudden started seeing these gigantic automotive OEMs with full semiconductor teams. First, it was sort of purchasing and quality, then they started adding design capability and resources, and they've built up over the years quite a capability. So, they take very seriously. They want to control their own destiny when it comes to their future car architecture. So we have a huge head start because of our Ethernet opportunity where were designed in. I have talked couple of times, we're in 16 different OEMs are going to use -- are using or are going to use our Ethernet solutions to provide in car networking and that provided a nice beachhead to go in and also show them all these other types of IPs we have, and now we're getting traction there. And so this is a longer-term opportunity but it can be quite significant in nature, because I would -- the analogy I would give you would be, I think the sea tide shift, we saw in automotive in the kind of mid-2,000s in sort of the infotainment revolution that benefited all kinds of customer companies, all kinds of semiconductor companies. The new wave of automotive suppliers came out of that. One was my prior company but also many others had huge benefit on the Infotainment revolution. I think this data-centric evolution in automotive is going to be just as substantial and really plays to our strengths. And so we look forward to articulating this in more details at our Investor Day. This is a long haul type of opportunity, but we've got enough traction now that it's going to be worth calling out and explaining to investors and the analyst community what we're up to, and what the opportunity could look like, especially for our long-term investors who want to -- who are now asking me hey, this is all great with what you're doing in 5G and what you're doing in cloud, what's next? And so we think there is a story to be told there about what's beyond these other cycles that can drive the company for a long time in the future.

Thank you for that.

Thank you. Our next question comes from Srini Pajjuri of SMBC. Your line is open.

Thank you. Thanks for asking squeezing me in. Matt, I just want to go back to the 5G topic, you alluded to Q3 being potentially up. I'm just curious, I mean are you getting better visibility as some of these regions roll out 5G. Is that what's giving you confidence and it looks like it's mostly coming from China, your Q3 commentary. Could you also talk about what's going on in some of the other regions like US or Japan and Korea and also touch upon India because that's been a big market for Samsung historically. Thank you.

Yes, thanks for the question. So a couple of things. I think one is, given the ramp that's coming and the lead times associated with these products, we have strong backlog today and we have strong bookings in this area, both in Q4, as well as in Q1 that certainly give us confidence that Q2 and Q3 are going to look very, very, very good in this area and the reason at least that we're hearing and that we can infer both from looking at the outside market outside in, as well as from our customers is that primarily -- it's primarily driven by China. But I think the OEMs are all gearing up to your point for the other markets. We see that Japan will start to roll out later this year. There was a concern that, that would get pushed or pause completely due to the Olympics moving out and then COVID-19, but it looks like that you all may not be as robust and we don't know yet, any of these things what the slope will look like but Japan is certainly talking about rollouts starting later this year. The US carriers, once they can start putting people back out and selling things, they're planning on second half in more robust deployments and then India --they've got a -- and the US, by the way, both have pretty important spectrum auctions that needs to get completed we think to really drive 5G. As you know, in India, we still have a strong 4G presence through our lead customer, but really it's 5G that's going to drive the growth. So we -- things may be moving around a little bit, they may be moving out but it's definitely a when, not an if and I think what's nice is, it's hard to handicap these. But what I'd say is, even though some of the other one -- if you looked at where we started the year some regions are probably pushing out a little bit more. And what we thought, but then the China opportunity actually sort of dwarfs that and offsets it. So I think net-net, we do see countries that are going to roll this out. It's going to take time, but it's encouraging to see at least a large deal [ph] really driving this forward and then ultimately that's rippled back to orders on our books that we need to go fulfill. So, appreciate the questions.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.