Good afternoon, and welcome to Marvell Technology's Fiscal Second Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Ashish Saran, Senior Vice President of Investor Relations. Please go ahead.

Thank you, and good afternoon, everyone. Welcome to Marvell's second quarter fiscal year 2023 earnings call. Joining me today are Matt Murphy, Marvell's President and CEO; and Jean Hu, our CFO. Let me remind everyone that certain comments made 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 in the Investor Relations section of our website. With that, I'll turn the call over to Matt for his comments on our performance. Matt?

Thanks, Ashish, and good afternoon, everyone. In the second quarter of fiscal 2023, the Marvell team drove another record level of revenue at $1.52 billion, growing 41% year-over-year and 5% sequentially. Revenue on an annualized run rate exceeded $6 billion, a significant achievement for Marvell. Revenue collectively from our four data infrastructure focused end markets grew 49% year-over-year and 7% sequentially, reaching a new high of 89% of our total revenue. Moving on to the rest of the income statement. Our GAAP gross margin was 51.8%, GAAP operating margin was 2.6% and GAAP EPS was $0.01. Our non-GAAP gross margin was 65%, and our non-GAAP operating margin hit a new record at 36.5% of revenue. Disciplined OpEx management helped drive our non-GAAP earnings per share to $0.57, above the midpoint of guidance. Earnings per share grew 68% year-over-year, much faster than our revenue growth as we continue to drive operating leverage. Now let me provide a brief update on the outlook for demand and supply. We continue to see healthy demand for our products with the exception of consumer HDD, and our overall demand is outpacing supply. The very successful adoption of our new products and strong end market demand has enabled Marvell to grow revenue significantly above our long-term target model. As a reminder, at our last Investor Day in October 2021, we had updated our long-term model for revenue growth to a target range of 15% to 20% from an annualized revenue run rate at that time of $4.3 billion. At the midpoint of the target, it would have taken us two years to achieve $6 billion in annualized revenue run rate. We are very pleased that we were able to cross this milestone this quarter, a full year ahead of our target. As we look forward, we…

Thanks, Matt, and good afternoon, everyone. I'll start with a review of our financial results for the second quarter and then provide our current attribute for the third quarter of fiscal 2023. Revenue in the second quarter was $1.517 billion, growing 5% sequentially and 41% year-over-year. Data center was our largest end market, accounting for 42% of consolidated revenue. Enterprise networking was next largest with 22% of total revenue, followed by carrier infrastructure and 19%, Consumer added 11% and auto industrial at 6%. GAAP gross margin was 51.8%. Non-GAAP gross profit was $986 million, increasing 41% year-over-year. Non-GAAP gross margin was 65% of revenue, slightly below the middle point due to product mix. GAAP operating expenses were $747 million, and included the cost of share-based compensation expenses of $135 million, amortization of acquired intangible assets of $88 million, an $85 million charge of contractual legal disputes segment and $7 million in other acquisition and divestiture-related costs. Non-GAAP operating expenses were $432 million, below the midpoint of our guidance. OpEx increased by 18% year-over-year as we added headcount to deliver the marketable new design we have won with key customers. We continue to drive strong operating leverage to grow OpEx to significantly less than top line revenue growth. GAAP operating income was $39 million. Our non-GAAP operating profit was $554 million, increasing by 67% from a year ago and non-GAAP operating margin was 36.5%, a record for Marvel. For the second quarter, GAAP income per diluted share was $0.01. Non-GAAP income per diluted share was $0.57, increasing by 68% year-over-year. Now turning to our balance sheet and cash flow. During the quarter, we generated $332 million in cash from operations, reflecting our strong earnings offset by continued working capital investments to support our top line revenue growth. We have increased our…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Our first question comes from Toshiya Hari of Goldman Sachs. Please go ahead.

Hi good afternoon. thanks so much taking the question. Matt, I wanted to ask a question on calendar 2023 or fiscal 2024. You gave some brief comments as it pertains to some of the big growth drivers that you've talked about in the past. I was hoping you could remind us perhaps the top three drivers that are idiosyncratic to Marvell as you look out into fiscal 2024? And how you're thinking about the supply side of the equation. Do you think by fiscal 2024, you'll be shipping to demand or you'll still be constrained, whether it be wafers or substrates? And the third part of my question, I think consensus has you growing top line by about 17%. Is that a fair number to start off with, or is that too high, too low? Any comments on where Street consensus is today would be helpful. Thanks so much.

Yeah. Thanks, Toshi. And we'll go ahead and do the trifecta of questions here. No problem. So on the first one, for next year, as you point out, there are a number of Marvell specific growth drivers, which we're very excited about. I'll cover three of them. And then, of course, there's other things going on as well. So the three biggest buckets and then the number one of all three is our cloud optimized silicon ramp. What we've talked about in the last few quarters and even year is a number of new design wins that we achieved over the last couple of years in this cloud optimized silicon area. And we sized it for those of you on the call that haven't been following it at about $400 million of incremental revenue for next year and then $800 million the year after. And that's still tracking extremely well. We have good line of sight on those programs. They're quite diverse in nature, by the way. So there's a number of them that are going to have to ramp and that's all tracking well. The second is, and you saw even in the most current quarter, again, another strong performance out of our 5G business in wireless, and the adoption of 5G will absolutely continue next year. And really, on top of that, which is more specific to Marvell is we have incremental content gains and SAM expansion coming as well. So that's also in front of us. And then on the third, our automotive business, which in general, has been about doubling on a year-on-year basis, if you go back over the last few quarters. This is automotive Ethernet. That also has a very strong outlook as well for next year. And again, this is really based on…

Thanks so much.

The next question comes from C.J. Muse from Evercore. Please, go ahead

Yes, good afternoon. Thank you for taking the question. I guess, a question around data center, particularly as it relates to the October quarter guide. I'm surprised that cloud is tracking only flat. And I guess, is that kind of a supply constraint that caught you by surprise, or otherwise, less than 3% sequential growth seems a little bit light. I would love to hear your thoughts around that.

Yes, no problem, C.J. Yes, a couple of things. One is, I said some of this in the prepared remarks. As we've battled through on the supply side, like a lot of other companies this year, it's been quite lumpy in terms of when the supply comes in and by what end market. And so, on an average quarter, we're not exactly, even over the last few quarters, able to perfectly forecast how much we can deliver. Now that said, in data center just for perspective, we had a huge step up starting in our Q1 of this year. We were constrained last year. We made a lot of great progress. Our Q1, I believe, was up something like 12% sequentially from our Q4 with -- and then we've sort of held at that level, maybe slightly increased a little bit through that time frame. And on the year-over-year basis, cloud has been absolutely on fire. And the final point would be, in the fourth quarter, we see a step up again, both on a sequential basis. So I wouldn't say it necessarily surprised us. I think we've known these programs, and we're doing our best. But at this -- and we're going to try to do better for this quarter, by the way. But at this point, this is how we see it. The cloud business for us has been extremely strong and overall for Marvell, remains healthy. I would say, it's more of a supply timing issue, and our operations team is all over it to try to obviously make sure we meet what our customers need and ramp when they want to ramp.

Thank you.

Yes.

The next question is from Ross Seymore from Deutsche Bank. Please, go ahead.

Hi. Thanks for letting me ask a question. Matt, I want to talk about the cloud optimized side. I know you answered to a previous question that, that should be an idiosyncratic driver for you next year. But how do I blend together, frankly, the answers to the first and the second question that was already asked, where the cloud side is lumpy, have ups and downs, but the good part is it's idiosyncratic, and you expect it to grow. So I guess the net of it all is, do you see risk to that $400 million over the next year and then another $400 million the year after there it's macro and/or supply stays lumpy, or do you think the customer-specific very customized aspect of those businesses will allow that to grow and deliver those numbers even in a more choppy environment?

Yes. Sure, Ross and a great question. Maybe just before I answer it, I'll just give a higher level view. And your question is cloud-specific, but if I just frame the overall Marvell strategy that we've put together and the business model we've put together, it's been one where diversification and breadth of product offering and technology and obviously, the financial model to go with it has been our North Star, right, since I joined the company and since this management team has driven this transformation. So you can even see it in the short term where like, for example, we've got constraints in cloud this quarter, but enterprise and automotive, when you look out to next quarter are doing extremely well, and that’s because of our diversification of our model, all focused around data infrastructure, by the way So while there may be lumpy 'parts' of our business from time to time, that is by design, how we've architected the business model of Marvell. And it's taken a long time to get here. And I think it's actually proving to be very resilient when you look at our Q3 being up and then our Q4 actually accelerating. So that's the bigger picture around how we think about it and managing lumpiness. Now with respect to the cloud, I might want to put a little asterisk by the 400, 800 and that we've actually talked about it being 400-plus and 800-plus in prior calls, which means the 400, 800 was identified last year. And then subsequently, in our communications with investors, including earnings calls, we've said we've actually won more business since then with incremental revenue both in fiscal 2024 and fiscal 2025. So next year and the year after. So think of it as kind of 400-plus, 800-plus diversified across a number of programs. So the bottom line is we feel very good about that ramp. Some of them, I'm sure, will require a lot more than we're planning for at this point. And I'm sure a few of them will require less than we're planning. But in aggregate, when we judge the outlook, and we just did a refresh of this just very recently, not only internally, but even with my key customers in terms of planning for next year, that ramp looks very solid in both of those years.

Thank you.

The next question is from Timothy Arcuri with UBS. Please go ahead.

Thanks a lot, Matt. I also wanted to ask about data center. And last quarter, I think the expectation was that you were going to see some reacceleration as the supply was going to improve into the back half of the fiscal year. So I know that the enterprise portion of that business is weak. But maybe can you help us understand sort of what's going on there? Maybe tell us how much cloud is as a portion of the total data center business? And then also into fiscal Q4, it sounds like total revenue is going to be close to $1.7 billion for you to be up high 30s, and that's up nearly 10% Q-on-Q. But I'm wondering how much data center will be up. I mean you said it's going to be up Q-on-Q, but I would think it should easily be up double-digits with more supply, you have the 5-nanometer products ramping. So I wonder if you can help with that. Thanks.

Sure. Yes, a couple of things. So on the first part on the data center, what we've said is that our -- the larger portion of the total is in cloud. So the exact number, we haven't quite disclosed it, but call it closer to 60%, 60-plus percent versus 40%. So that's been -- and that's why we said even in this prior quarter on the year-on-year, cloud grew much faster than the total just because of the enterprise of the mix. Now reminder, a little bit on the enterprise side, it's not a great proxy of what I would call enterprise data center from the standpoint that those products we sell into that market are fiber channel and Ethernet adapters, which are somewhat of a legacy type of business for Marvell. So that one we've been pretty upfront about this. That doesn't have a lot of growth per se ahead. And so really, it's been all about the cloud. The -- in Q4, as we said, the overall company revenue, we expect to accelerate off of Q3. We haven't pegged the number. I think the range you're discussing looks a little on the high side. But if you just back in to the high 30s comment we made and you take the two quarters we've already produced, we take our Q3 guide and look at Q4, you'll get to a range that seems to make sense. So yeah, I guess bottom line is we do -- and I think the acceleration we thought we would get in the second half on cloud is more a Q4 type of story than Q3, and that's how it's playing out primarily on the basis of supply.

Okay. Thank you.

The next question is from Blayne Curtis with Barclays. Please go ahead.

Hey, good afternoon, and thanks for taking my question. I just wanted to go back to the demand part of the equation. I thought you said in the beginning, consumer HDDs were the only thing weak, but you have two segments that are down. So just maybe just revisit that even in the areas like enterprise that are up a bit, it sounds like supply. So I just wanted if you could revisit the demand outlook and I think you said data center is lumpy, but I mean is it all lumping in timing and supply even for the businesses that are down, or have you seen any broader downticks on that demand side?

Yeah. Blayne, I think when I look at your question there, the enterprise side and particularly the on-prem, I do think that, that has been more lumpy in terms of the supply we've gotten and how we've delivered it. We haven't really seen a lot of demand changes there per se. But we certainly, in our first quarter and a little bit of our second quarter, we're able to produce more supply than we had hoped. So when we talk to customers, the demand signals there don't look anything out of the ordinary versus what we have seen historically. This because it kind of feels like we're going back to a little bit of where we were before this huge up cycle. But it's all within the normal range. I think the comment on consumer HDD was really -- it's down, it's pronounced. We can quantify it. But the other part you mentioned is it's more around the lumpiness of our supply delivery rather than demand being down.

Thanks Matt.

Yeah.

The next question is from Matt Ramsay with Cowen. Please go ahead.

Yeah. Thank you very much. Good afternoon. I don't know, just for a change of pace, maybe something not engage.

You can go there, Matt, no problem.

I wanted to ask about the enterprise networking segment. The big upside there and guiding for almost 25% growth or 70% year-over-year. Is that -- maybe you could talk about the specific product cycles that are going on there, or is it, in fact, that's where you're able to upside in supply and just disaggregate what's driving that to be the fastest-growing segment right now? Thanks.

Yeah. Thanks. Yeah. Actually, it's a combination of both where we have very strong demand for our products. I'll cover that in a second on why that's a little bit unique to us. But then also, I would say, we're -- we have been -- we called this out a couple of quarters ago. This had been one of our more pronounced areas of delinquency, and we're starting to finally catch up. So it's a combination of both, Matt, which I think is producing a very strong result, obviously, as we guide out not only in the Q3 guide, but also the quarter we just finished. So, on the demand side, I mean, we've -- I think a couple of things, right? In our sort of classic Marvell portfolio we've had very consistent share gains and new product introductions with a lot of success in the enterprise class Ethernet switch and PHY area. In some of those cases, we sell the two products together as part of a total solution. And one trend that I think we had talked about for quite a while, and it's actually here, and it's right in front of us, and it's showing up in our numbers is the adoption of multi-gig PHY technology. The large enterprise OEMs, and you can listen to their commentary, they're seeing a big uptick. A lot of that is driven by WiFi 6, which at some point, the wireless rate line rate was going faster than the wired rate. So, that's driven a pretty big adoption. And the content and the per port has gone up dramatically as you switch to multi-gig. And it's not like 10%, 20%, 30%. It's sort of multiples on a per port basis of where it was before. And that's hitting, okay? So, you've…

Thanks for all the detail Matt.

The next question is from Gary Mobley from Wells Fargo. Please go ahead.

Good afternoon everybody. Thanks for taking my question. I had a couple of questions on the -- some of your foundry relationships. Jean, I believe you mentioned that you're purchase obligations with your foundry partners ticked up about 15% sequentially. It sits in about a half years' worth of revenue. I'm wondering if given that capacity seems to be freeing up a bit, might we see that those purchase obligations level off? And what are the risks there of maybe not being able to take all that commitment in the future? And then as well, have you -- or do you anticipate any additional price increases from your foundry partners that you may eventually have to pass on to customers?

Yes. Hey Gary, thanks for the question. First, on the long-term purchase commitment. As Matt mentioned, right, we focus on data infrastructure. Our products tend to have a very long product cycle and most of our products were so soft. So, based on the design wins we have and the product ramp and the business planning, we struck strategic relationships with our suppliers to ensure we can secure the capacity in the longer term. So when you look at the purchase commitment, those are very long-term commitments like two, three, five to seven or even beyond the years. Our team has done a great job to really analyze what we need and what we should strike as a long-term purchase agreement. Typically, it's only a very small portion of our overall supply needs. So we actually feel very comfortable by analyzing the need, the product ramp or the customer relationship and what we are committing. If you look at it each year, it's actually very small month, right, its spread into seven years and beyond. So we feel pretty good about that. On your second question about supply chain input cost, it's still very tight supply chain environment. We continue to believe in next year we are going to continue to face challenges in complex substrate and some of the component and even older generation wafer side. So, for us, we definitely -- if there's input cost increase because of supply-demand imbalance, our strategy and our approach has been really working with our suppliers and the customers to make sure we share the cost to increase overall. So that's our current expectation.

Thanks, Jean.

The next question comes from Harlan Sur with JPMorgan. Please, go ahead.

Good afternoon. Thanks for taking my question. On the cloud optical connectivity business, this is both inside and between data centers, the upgrade cycles have been this really great multi-year tailwind for the team. And if I look into next year, I believe that there's still at least one of the top four US hyperscale titans that's going to start the 400-gig PAM4 transition. You still have China CSPs that need to fire. You've got multiple customers on DR that's going to fire as well. Historically, like these transitions, I don't think have been impacted by a slowing macro demand environment. They're viewed as, I think, very strategic. But is that how your cloud customers are thinking about these upgrades and your views on continued upgrade momentum in this segment for next year? And just relatedly, is the Innovium team on track to drive $150 million in revenues this year?

Hey. Thanks, Harlan. Yes, I think the first part of it, you got pretty well in terms of the transition on 200 and 400 gig PAM4 inside the data center. And then, the new ramps we're seeing in 400 gig ZR for DCI between data centers. What I'd add on top of that is -- which has been extremely strong and also, in some ways, a little bit of a constraint we've seen in terms of being able to keep up is, the demand on 800 gig, which is happening right now really around, obviously, very advanced AI workloads. That is an area where, if we could obviously produce more material, we would be shipping it in Q3. So that's also a positive trend. So you've got sort of the transition going on all the way up to 800 gig, and that continues to look pretty good. On the data center switching side, we are on track for the $150 million of data center switching this year. And we see very good traction in the market to -- in the solutions, we're talking about now at 51.2 with our PAM4 DSPs as kind of a total solution. So that's also going well. The team has been integrated very well into the company. Road map looks very strong. It's pretty exciting. So that was another growth vector that I did not mention upfront, but I guess you could lump -- it's not part of our 400, 800 cloud, the $1 million ramp. But that's also incremental opportunity for us in cloud switching.

Perfect. Thanks, Matt.

Yes.

The next question comes from Tore Svanberg with Stifel. Please go ahead.

Yes. Congrats on another record quarter. Just kind of staying a little bit on what's to come, especially in the next few years. You talked quite a bit about CXL. I was just wondering when will that business start to ramp? I mean we're talking about more than $1 billion SAM here? And when could that business sort of become bigger than the Consumer HDD business. Just to kind of put into perspective, unique growth drivers versus market drivers? Thank you.

Yes. Well, Tore, that would be a great day. We can crack the champagne if we can get CXL, up to where the consumer or the HDD business used to be. But in all seriousness, this is new. This is a new technology transition that's happening. It's actually very exciting for the team to look at now really enabling these solutions to -- in the memory ecosystem. The -- we have a full road map that's well underway in terms of product development but it's still early. So we're still a couple of years out. And by the way, just to be clear on the opportunity, that's the SAM, we said was over time. The $1 billion-plus or multibillion. So it's still a ways out. We're not ready to sort of talk about when the timing exactly of that, but we're very encouraged. It's an absolute real trend. We intend to be a leader here. We're investing ahead of the curve. Tremendous traction on our road map and the breadth of what we can do in CXL. So it's an exciting one, and we just thought it was appropriate to flag that for investors is yet another opportunity to leverage a lot of the great technology we have into the same set of accounts. And in the case of CXL actually helped enable them, right, to architect these solutions for the future. So I think it's going to be a pretty exciting one, but it's a little ways out. And none of that is sort of in the -- like the $400 million next year, as an example. That's not part of it. That would all be incremental a few years out.

Great. Thank you.

The next question is from Srini Pajjuri from SMBC Nikko. Please go ahead.

Thank you. Hi, Matt. My question is on 5G, in particular. Now that India 5G auctions are behind us, I'm just curious as to how we should think about that opportunity, Matt? I think you have a pretty strong position there, but could you put that into perspective versus a US opportunity or Europe opportunity? And then the second half strength, is that what's driving it? I think you're guiding 5G to be up even in the third quarter. So I'm just curious if you're seeing any action from India as yet? Thank you.

Yes. And Jean, you can chime in, but I think India for us is still -- I think that's still a next year type of event, although the -- as you mentioned, the tenders have gone through. We're well positioned for that. I think we've historically through our partners, had a strong position there. But I would say it's -- the way to think about our 5G business now is more broader, diversified and a consistent performer. So I don't think you're going to see it take some enormous leap in a given quarter as an example. I mean, it's been performing extremely well. If you go all the way back to kind of the initial ramps two-plus years ago, we basically had sequential growth, I think about every quarter, except one, maybe, I don't know, seven quarters ago where we were flat or something, right? So it's -- I think, again, it's a good example maybe at a smaller scale of the diversification strategy we've tried to drive, whereas, we go into these markets, we do try to find a number of key partners to line up with such that we're -- we try to reduce volatility and perform well in any environment. So I think India is just another example. But I think there's also other geographies that are going to be laying in as well. And I think maybe even the bigger tailwind is just increased content as new systems roll out with more and more Marvell silicon per base station. I think that's really where will be a bigger impact than a particular geography ramping up in a given quarter. But Jean, any thoughts on that to add?

Yeah. Matt, to just add to what you just said is this year, we have seen significant growth, and the run rate is already over $600 million now. And that's actually largely benefited by North America, right? And the North American adoption of 5G has been really strong this year. Going forward, India definitely maybe next year or beyond. But Matt is right, is our 5G business will continue to be a very significant growth driver next year for us. It has a really long product cycle and the visibility actually is pretty good in this market.

Got it. Thanks Jean. Thanks Matt.

The next question comes from Harsh Kumar with Piper Sandler. Please go ahead.

Yeah. Hey, Matt, I had a question for you. So if I layer in your thoughts on the $400 million odd of custom cloud silicon, that's about 15% growth by itself to your cloud business. And then I assume your business will grow at least that much, if not more, organically. So is it fair for us to think for January 2024 for that data center business to be somewhere in the 30-something odd percent range or even better than that? Yeah.

Yeah, I think I'd have to probably get out a spreadsheet to go figure that one out, Harsh. But I think directionally, I think you're right in that. You have an estimate of what our cloud revenues are and certainly layering in the $400 million would get you to a certain number. And then you're absolutely right, what I didn't bring up is that the base business, right, which doesn't include the new wins is also ramping up. So we haven't sized that piece of it exactly, but clearly, that's going to grow as well next year, the kind of existing run rate portfolio because some of those programs whether it's in cloud switching, whether it's in electro optics, some of the things we've already talked about today that are already in the run rate are certainly going to grow. So yeah, I think that's -- I think from there, you'll have to kind of -- I think when you say 2024, I got a -- I don't know that exact number off the top of my head so.

No, very helpful. Thank you Matt. Appreciate it.

Yeah.

The next question comes from Quinn Bolton with Needham. Please go ahead.

Hey Matt, I wanted to follow-up on Matt Ramsay's question on enterprise networking. If I look at the business in the October quarter, it looks like you'll be over $400 million, and that's up probably two and a half times over two years. So, phenomenal growth, but clearly well ahead of the market. I know -- some of that is content gains, some of its market share. But if you look at inventory in the networking space, OEM inventory levels are probably up 2x over that two-year period. And so -- do you guys have any way of knowing whether there's any inventory that's accumulated in that channel? Do you think you can sort of sustain this $400 million quarterly run rate into next year, or do you think you may see some ebb and flows especially after a very strong October levels looking beyond October?

Yes. Okay, Quinn, it's a great question. And certainly, we're very aware of kind of the broader inventory growth that's gone on in a number of the end markets that we serve. And this one, in particular, I think a couple of things give us a lot of comfort. The first is we've still been ramping into some of these new designs. So, they're not -- it's not business we had two years ago and it was at x run rate, and now it's at x times two run rate. I mean almost all of this is effectively new programs that have ramped up. I guess the silver lining is on the supply constraint so far is that we haven't been able to get over our skis on over shipping. And so -- and we continue to have escalations by the way, even within enterprise networking today, in terms of trying to meet the demand. And again, as I said, because we're in the new systems and the new programs, those are the ones typically our OEMs are the most short on, and they're trying to sell. So, I think it's a very fair question. And certainly, for somebody that's got a lot of market share in a given end market that had a run rate business, that had been going on for a while and it got inflated because of inventory growth over the last few years, one would get concerned. But that's not as much of a concern for us overall in enterprise networking today. And so I think we feel pretty good about the run rate we're on and the fact that we're running a lot farther ahead than we thought, and we still have some growth ahead of us, but we're watching it closely for sure, Quinn. No question.

Great. And just as a quick follow-up, can you comment about how much of your cloud business or hyperscale business maybe driven by the Chinese hyperscalers? I know some of the -- your peers in the industry have commented that they've seen a recent weakening demand out of the China hyperscalers? Thanks.

Yes. We're -- go ahead Jean.

Hi Quinn, this is Jean. I'll answer, Matt, can add. Our cloud business are primarily US hyperscale data centers. So, we actually have a very limited revenue exposure with the Chinese hyperscale data centers today.

Great. Thank you.

The next question comes from Joe Moore from Morgan Stanley. Please go ahead.

Thank you. I wonder if you could talk about the supply constraints. I think a quarter or so ago, probably our biggest problem was analog parts, I know substrates have also been an issue trailing-edge wafers. Are those priorities shifting? You talked about a little bit at the sort of more complicated parts that are giving you trouble. Can you just talk a little bit about where is supply getting better? What supply chain is getting better and what's getting worse? Thank you.

Yes. Great. Thanks, Joe. No, I think you're right. I think certainly -- I mean, there's independent of us, right, there's been broader constraints within the analog peer group that have caused sort of golden screw issues and things like that with -- and remains to be seen when all those sort themselves out. For our purposes, and again, some of those constraints overlap, because we do -- in some of our mixed signal technology, we do have a pretty broad usage of some of the older nodes relative to CMOS or by CMOS technology, which would be 28-nanometer, 40-nanometer, 55/65. Those have been historically over the last two years, very constrained. They continue to be constrained. We've -- but it's gotten better for sure. It's gotten better. And some of that -- some of those older nodes have been where the lumpiness of our supply has come in. You can see actually even when you look at our guide for the automotive business, those -- the five portion of that business uses some of this older technology. And you can see we're very strong sequential guide there. So that is starting to work itself out. There's still constraints where we're having a little bit more trouble. And I think some of the peers are too, is just when you get into these larger, more complex packages, Joe, that use flip-chip BGAs and large complex substrates, that's still in very rough shape. And you have to plan way in advance, even now, for the capacity that's going to be required there. That trend on ABF especially is only going to go up. And so, I think, the more complex products is where it continues to be a pain point. And I do think over time, as the cycle plays itself out, probably some of the legacy nodes and the analog stuff probably lightens up. But I think for high complexity, there's just such a move in the industry, companies like Marvell and a lot of our large peers who more and more are just producing tremendous amounts of compute power and high-performance computing broadly, whether it's in networking or custom-silicon or CPUs or GPUs, you name it, it's all going to this complex technology, and that's where we have to just continue to be tactical and keep our heads down and match supply and demand and get what we need.

Very helpful. Thank you.

This concludes our question-and-answer session as well as our conference. Thank you for attending today's presentation. You may now disconnect.