Greetings. Welcome to the Semtech Corporation Conference Call to discuss the First Quarter Fiscal Year 2023 Financial Results. Speakers for today's call will be Mohan Maheswaran, Semtech's President and Chief Executive Officer; and Emeka Chukwu, Semtech's Executive Vice President and Chief Financial Officer. Please note, this conference is being recorded. At this time all participants are in a listen-only made, a question-and-answer session will follow the formal presentation. I will now turn the call over to Semtech's Executive Vice President and Chief Financial Officer, Emeka Chukwu.

Thank you, operator. The press release announcing our unaudited results was issued after the market closed today and is available on our website at semtech.com. Today's call will include forward-looking statements that include risks and uncertainties that could cause actual results to differ materially from the results anticipated in these statements. For a more detailed discussion of these risks and uncertainties, please review the safe harbor statement included in today's press release and in the other risk factors section of our most recent periodic reports filed with the Securities and Exchange Commission. As a reminder, comments made on today's call are current, as of today only, and Semtech undertakes no obligation to update the information from this call should factor circumstances change. During this call, all the prices made the financial results in my prepared remarks and Mohan's prepared remarks, we refer to non-GAAP financial measures unless otherwise noted. A discussion of why the management team considers such non-GAAP financial measures useful, along with detailed reconciliations of such non-GAAP measures to the most comparable GAAP financial measures are included in today's press release. In Q1 fiscal '23, the company delivered net revenue of $202.1 million, a sequential increase of 6% and an increase of 19% year-over-year and was once again above the midpoint of our guidance. These numbers include $2.9 million of revenue from our High Reliability business that we divested at the start of Q2. We continue to demonstrate the leveraging our model by growing earnings at approximately twice the rate of revenue growth. Non-GAAP earnings per share grew 14% sequentially and 51% year-over-year. The strength of the secular drivers behind our growth engines of LoRa, Tri-Edge, PON-X, 5G and systems protection platforms contributed to the strong net revenue performance despite the challenges presented by COVID and supply constraints.…

Thank you, Emeka. Good afternoon, everyone. I will now discuss our Q1 fiscal year '23 performance by product group and provide our outlook for Q2 of fiscal year '23. Our Q1 of fiscal year '23 net revenues of $202.1 million represented a 6% sequential increase and a 19% year-on-year growth and represented another exciting Semtech record. We posted record non-GAAP gross margins of 64.8% and record non-GAAP earnings per diluted share of $0.80. These numbers include $2.9 million of revenue from our high reliability discrete business that we divested at the beginning of Q2. Our Signal Integrity Product Group grew 19% annually and achieved a fourth sequential quarterly revenue record and represented 40% of total revenues. As expected, growth was driven by the data center and PON markets. In Q1, our hyperscale data center business was strong, led by growth from our Tri-Edge PAM4 short reach platform. Design-ins of Tri-Edge in 100-gig, 200-gig and 400-gig PAM4 optical modules and active optical cables continue to gain momentum globally. In Q1, revenue from Tri-Edge increased over 100% over the prior quarter, and we continue to believe our hyperscale data center Tri-Edge revenues will triple in FY '23 as more customers move to full production and we increased our market share over DSP solutions in the 200-gig and 400-gig PAM4 segments. Our customers are also giving us positive feedback on our long-reach Tri-Edge, targeted at 200-gig FR4 optical modules. This will be another growth driver for us over the next few years. These new longer-reach devices approximately double our SAM in the hyperscale data center market. We remain confident that TRI-Edge's ultra-low power, low cost and low latency together with FiberEdge high performance will enable us to continue to grow our hyperscale data center business over the next several years. Our PON business…

[Operator Instructions] Our first question comes from Tore Svanberg with Stifel Nicolas. Please proceed.

Yes, hi good afternoon. This is Jeremy calling for Tore. I guess, first of all, congratulations on the record quarter. A question on the protection business. It's nice to really see that the broad base growing so nicely. When do you expect to see -- or do you expect to see a cross at some point to 50% plus? And which of those three sub segments are driving that growth?

It's a good question. It's something we're striving to achieve, but our consumer protection design wins continue to be very positive as well. So obviously, the automotive is probably the strongest at the moment. I would say communications and then the broader industrial and IoT within our protection business are all doing well. They do take longer. The design wins to revenues take longer in the broader market. So I think the percentages will be volatile, but it's trending in that direction. So probably over the next 3 years, I would expect 50% to be kind of realized for each segment.

Great. And I guess maybe turning to the Tri-Edge product. This is your -- I guess, your PAM4 analog solution. Can you give us -- are there any partners that you can provide? And any I guess, which maybe regions or areas that you expect to see driving the most in this business?

Yes. We're getting momentum across all regions, I would say. Obviously, very good momentum in China, a very good moment in North America, where the two biggest regions for data centers are today. It's where most of the SAM is. I think with our long-reach products that are now being sampled and getting good feedback will get even more kind of balanced across regions there. But yes, it's pretty broad at the moment.

And by long reach, can you give us the range?

Yes, the shorter reach products are kind of less than 100 meters and the longer reach of kind of in the 2 kilometers to 10-kilometer range.

Great. Thank you very much.

Our next question comes from Tristan Gerra with Robert W. Baird. Please proceed.

Hi, good afternoon. Follow-up question on your protection business, obviously, very strong, driven by automotive and industrial orders. When I exclude the consumer piece of that, which is weakening, what is the sustainability? And could you elaborate a little bit on the longer-term drivers that you see for your protection business?

Yes. So let me start with the consumer, Tristan. I think it's -- I wouldn't say it's weakening, I would say it's more -- that's really driven by macro weakness. We're still doing very well in the consumer space. We get a lot of good design wins in that space. So as customers continue to use leading-edge lithographies, we expect that business to continue to grow as long as the macro grows as well, of course. The Broader Protection business is really doing well. And I think partly that's because we're seeing more advanced lithographies being used in those segments now. If you look inside a vehicle, we've got a lot of different things going on in in a vehicle from displays to Ethernet ports, communications, to antennas, to all USB ports, for example, I mean, so a lot more electronics going into the vehicle. And the same can be said of some of the other segments like industrial and IoT. And some of those segments are using advanced property processes, and that's where Semtech protection really is quite strong. So I think given that this is a new focus area for us over the last couple of years, and we've got a lot more products coming out in this area, my expectation is that this business is going to continue to grow. It's obviously higher gross margin. It's not as high volume as consumer, but not as volatile also, and I think a lot stickier. So it should be a very solid business for many, many years, I would think.

Great. And then for my follow-up question, how should I look at the impact of the lockdowns in China that you think you can recover in the second half of the calendar year versus just weak demand in China where there is a less clear outlook on when that is going to recover?

Yes, there's -- I think there's different elements, Tristan. So first of all, bookings have been weaker, definitely because of -- and China has been a little bit in shutdown mode, I would say, contract manufacturing and some of the supply chain issues have also been a challenge. I think I expect both of those areas to kind of recover as the lockdowns kind of -- as China goes back out of lockdown into more regular mode. Then there are some dynamics related to shipments out of China into Ukraine and Russia. So there's some demand softness there from -- in the smartphone area. I think that's something that may take a little bit longer to come back. But my sense is, yes, China typically, once they've gone through a little period of not growing, we expect to see heavy investment in infrastructure. So that's what I'm expecting in the second half kind of to catch up there kind of growth across the year, but yet to be seen, but that's what we're expecting.

Great. Thank you very much.

Our next question comes from the line of Craig Ellis with B. Riley Securities. Please proceed.

Yes, thanks for taking the question. And I'll start with just a question for Emeka. Emeka, gross margins are tracking a little bit better in the outlook than I expected, albeit consistent with what I think you had called for previously with a 100 to 200 basis point gain this year. The question is, is there any benefit to gross margins from that divestiture? Or are we just seeing the underlying mix dynamics that you've been talking about, just give us another leg up sequentially?

Yes, definitely, there is a slight benefit to gross margin from the divestiture. But given that, that business is pretty small, it was probably about $14 million to $15 million a year type of business. The overall impact is not that huge. The key driver behind our gross margin expansion continues to remain the growth engines that we've talked about. So as we continue to see success with LoRa as we continue to see our Tri-Edge gaining traction out there and continue to increase us, we'll continue to see the benefits of diversification efforts in protection into industrial, automotive. PON-X, our PON platform that has actually got gross margins around the corporate average. I think as we continue to see a higher mix of all of this as part of our revenue, our gross margin should continue to see some slight expansion.

That's great. And then the follow-up question is for you, Mohan. Based on my tally of your comments on the LoRa metrics, it looks like everything is tracking to the metrics you provided a quarter ago. So one, I just wanted to clarify that? And two, it does seem like across every one of them, there's good progress. So is it fair to say that despite what is a very tumultuous macro environment, you continue to have strong engagement with customers deploying LoRa and with or uptake?

Yes, Craig. I think that is a fair conclusion. Our metrics are all on track, we believe, good momentum, very comfortable with the commentary I made on the expansion of the infrastructure. So lots of gateways. I would say the funnel is very positive at the moment as well. We have to make sure that -- and this is where the work is, is really ensuring that, that funnel converts to revenue, we say typically 24 months. My expectation is if things get -- we go into kind of a recessionary environment that some of that time line might push out. But the reality is when you look at the use cases, a lot of these use cases are about real smarter planet initiatives, they're about energy management, resource management, asset management and things that are going to help as the kind of Smarter Planet initiatives are driven across the globe. So I don't expect any type of slowdown at all. And LoRa is just a fantastic complementary technology for Smarter Planet initiatives. So we're keeping a very close watch on the different use cases across the different regions. And we have a pipeline that's pretty exciting. We just need to work with our customers to make sure there's not any major bottlenecks. Some of the bottlenecks could be sensors, sometimes it's software, but working with those customers and the ecosystem to resolve those really will result, I think, in us kind of hitting our dashboard metrics and then that drives the future growth. So pretty optimistic about it, yes.

Got it. Thanks guys.

Our next question comes from the line of Rick Schafer with Oppenheimer. Please proceed.

Yes, thanks. Congrats on a nice quarter, guys, a nice guide, ex the divestiture. Maybe a follow-up question on LoRa? I mean, by my math, LoRa close to $50 million this past quarter, up better than 50% kind of year-over-year, I think, again, by my math, it seems to be either sort of in line with last year's growth rate or even accelerating. So I don't know if you basically feels like the 40% growth target is covered this year. I was just curious if you guys could talk about where backlog is today and how far it extends out into next year? Just trying to get a sense of your visibility into next year's kind of run rate.

Yes, Rick. So next year is a little bit far out, I would say at Q1. But I think for the rest of -- most of this year, we're in pretty good shape. Obviously, we don't need any turns for Q2. We're keeping a close watch on consumption. I think that's really the key. Obviously, Q1 is another record. We are on track. We are very comfortable with our 40% CAGR. The guide that we've given to you guys for the next few years, and we're on track, I think, to achieve that goal this year. And the key for us is really, as I mentioned, looking at the funnel and making sure the funnel is converting and some of those large opportunities in the funnel, which are fairly broad and more balanced in nature from geographical region standpoint, they really become realized. And I think if they do then we are very comfortable with the ongoing plans for next year. For this year, I think we're in pretty good shape. I don't see any real issues. I think obviously, a lot depends on the macro. But so far, I think we have pretty good visibility for most of this fiscal year.

Okay. And then as my follow-up, I'm just curious, everybody's talking about investing, prepaying and future capacity, and you guys have done such a great job keeping cost down expenses growing, I think, on average about half the top line. So I was just curious if you can level set us sort of what your plans are there? Is there anything kind of coming up that would cause OpEx to sort of accelerate or grow faster than the sort of targets we've seen?

Hi, Rick. Thank you. Like you've noted, we've done a good job of managing OpEx, and we've always done a good job of that. Now as I look ahead, I don't really see anything out of the ordinary. We will continue to make the investments in new products in some of the exciting growth areas that we have. We'll continue to make those investments. I think given the environment these days of employees being able to change jobs and things like that, we are making sure that we are taking good care of our employees, making sure that they are properly compensated. But there is nothing really out there that I would say that is going to drive a significant increase in our operating expenses beyond the levels that we have publicly articulated.

Great. Thanks for the color.

Our next question comes from the line of Trevor Janoskie with Needham & Company. Please proceed.

This is Trevor on for Quinn. And thanks for taking my question. Since we're hearing concerns about consumer weakness potentially carrying into other segments, we're wondering if you could provide more color on the current data center demand, like has there been any changes that could be concerning? And perhaps how is your visibility into the second half?

So Trevor, you started talking about consumer and then your question asked about data center. So data center is quite strong. We don't see any real issues there. Consumer is weak. Smartphones are definitely weak, and I would say, PC and computing is a little bit weaker related to consumer. Some of that is, I think, people going back into the office and away from home and working in the office now. Some of that, as I alluded to, is related to the war and some of the areas there, which are not being serviced from a demand standpoint, I think. So -- and the demand is obviously not going to be there in the middle of a war. So you've got some of those pockets coming out. I would say it's very regional dependent. I mean China is clearly going through issues at the moment. So -- but just think could bounce back in the second half. A lot depends on the broader macro environment and inflation and things like that, which could drive consumer weakness in the second half. But if that becomes under control, then my sense is also that the semi industry is, to some extent, still a little bit in this supply-constrained environment. So we could see that driving into the rest of this year. For the rest of this year, we could see strong demand in other words. But at the moment, yes, consumer is a little bit weak.

That’s all I had. Thank you.

Our next question comes from the line of Harsh Kumar with Piper Sandler.

Strong congratulations. Very good results and guide. Mohan, I was wanting a little bit more color on LoRa. I was curious now that your gateway business is humming with Amazon. I was curious if you would be able to provide us a rough split of revenues between nodes versus gateways? Or give us some color if you don't want to give us the exact percentages?

So first of all, we're not going to break out the details, Harsh. And part of the reason is it's very different. So macro gateways, we sell devices for $15 a picocell gateway could be $5. In Amazon's case, it's less than that. So the unit volume doesn't necessarily correlate in terms of when you try to kind of figure out how many gateways are and et cetera. What I'll tell you is that across the board, the gateways are expanding very nicely. So I mentioned on my prepared remarks there that Amazon Sidewalk Gateways grew 35%, macro gateways grew 6% and helium gateways also grew over 40%. So we've got good growth in gateway deployments. As you know, the gateways are just infrastructure, right? So the key is now getting sensors connected to those gateways. And that's really the key for future growth. So as we look forward, I don't think the gateways deployed and the number of gateways are really that relevant because we've got a lot of capacity out there. So now the question is, okay, so what's going to drive -- which use case to drive the sensor connectivity to those gateways. And that's really what we're focused on now.

Appreciate it, Mohan. Then I had maybe one or two for Emeka. Emeka, I'm not sure if I heard this correctly, but if I didn't, please correct me. But I thought you said the bookings were down 23-odd percent in 1Q. And I was curious, was that just a function of turns? Or is there something going on that maybe you could provide us some color on? And then my second part of the question was slightly separate. The buyback, you guys stepped up pretty big, obviously, to help the stock out and you talked about $200-something million remaining on our buyback. I guess I'd be curious about your view. Are you of the opinion that you're stacking very cheap here that you'll be very aggressive at these levels, and we should expect similar kind of take-up in buyback from Semtech at this level? Just color, again, looking for color.

Sure. Sure. Harsh, I think you heard it correctly. I did report that our bookings were down 23% in the quarter. But we started out the quarter with bookings being very strong and things can have dropped off around the time that China started to shut down because of COVID. So I think a lot of the decrease is a COVID-driven out of China. The expectation is that our sales start to open up. We're pretty excited. I think today or yesterday, we heard that Shanghai has been in to open back up by some parts of Beijing are also looking to open up. So the expectation is that things will start to get better in that area.

And let me add one other comment on the bookings, Harsh. Bookings have been extraordinarily strong for almost the last I would say the last year. So remember, we are -- we've got a lot of visibility at the moment. Backlog is very strong. So I don't know that bookings is a good metric at this point in time. You probably want to start looking at consumption as a better metric.

And then that's a good point, Mohan. Just going to -- just want to remind you that we reported that our Q1 POS was actually a record for the company. So the consumption is still doing very well. Moving on to the buyback. What we've said in the past is that we're going to buy back shares to just keep pace with dilution from our grants to employees. But with regards to valuation, Harsh, we'll probably leave it up to you guys and investors to just figure out the valuations. And all we know is that we have a business that is actually built on very strong fundamentals right now as Mohan has said in the past. This is the best this company has been positioned in terms of -- from a strategic point of view. We continue to believe that we are just at the beginning of a multiyear double-digit growth cycles here. So with regards to what we are worth, what the valuation is, we'll leave it up to you guys to make that call, but I will just continue to run the business and deliver the numbers.

Emeka, appreciate the color guys and strong execution, very much appreciated. Thank you.

Our next question comes from the line of Gary Mobley with Wells Fargo Securities.

Hey guys. Thanks for taking my question. I had just one question, and it's an extension of what Harsh was asking about. So I'm trying to reconcile the difference between a 23% decrease in bookings and what is essentially 5% sequential revenue growth adjusting for the sale of the high rail business. And so if I presume you're living a little bit off the backlog. And so my question is, will this slowdown in bookings, however long it will continue, manifest itself in the second half of the fiscal year?

Gary, the answer to that is it depends. Probably it will start to -- if it continues to be extremely weak, then it will start to have an impact in Q4, I would say, but more likely next year. Remember, we've had very strong bookings as most of our peers in the industry because of supply constraints. And so most of companies, including us, are fully booked in, and we have a lot of backlog. Obviously, we don't need any turns this quarter. Next quarter is in pretty good shape, I think. So -- but Q4 and then going into next year and how next year looks like, I think, obviously, we need to keep some pace on the bookings, but it was unrealistic to actually to have the bookings at the rate it was on. We were on such a tremendous bookings rate previously that I think that was unrealistic. So I think the drop-off is now bringing some normalization back to that. And as I mentioned, I think the key thing is to watch consumption. Obviously, customers are using the materials which we are looking at very closely, then I think everything will be fine. So that's the key metric to look at.

Our next question comes from the line of Scott Searle with Roth Capital. Please proceed.

Hey good afternoon. And thanks for taking my questions. And I appreciate all the color on LoRa and on some of the other businesses, particularly the reinforcement of the 40% CAGR. Maybe just to follow up on a couple of the earlier questions related to LoRa. Mohan, China had been a big portion of the mix in the past, and you guys have been diversifying away from that. I'm wondering if you could update us in terms of LoRa's China contribution, how that factors into the mix? And then looking out to the remainder of this year, you're starting to see the ecosystem develop more and more around Amazon Sidewalk and helium. I'm wondering how you're thinking about that in terms of the contributions to the model, what you're kind of factoring in, how aggressive that is in terms of the build-out of the ecosystem for this current fiscal year?

Yes. Scott, most of the smart home-related opportunities in our funnel, we don't have a tremendous amount of revenue yet from that segment. And I would say that's true of the smart home and the smart campus segment. So when you look at the revenues today, most of the revenues are coming from the use cases that have been in deployment for the last few years. So smart utilities, smart city, industrial IoT, smart ag, those type of kind of more traditional industrial use cases. And a lot of that is China, of course, as we mentioned before, 50% of our business and LoRa comes from China. But the funnel, the opportunity funnel really starts to get interesting as you look at the details. A lot of that is smart home, it's smart asset tracking logistics and driven out of both Europe and North America. So that's what we need to convert and make sure that they realize revenue. We are quite comfortable now that the infrastructure is going in place. That's kind of the first major hurdle, but that's -- that seems to be overcome now, obviously, with gateways going out there. So we've got pretty good alignment there. Now it's a question of getting the other aspects of the use case result and that sensors and software and just the different economics around each one. So which we're very confident about. And a lot of it started to type of smarter planet and sustainability. So I think it's going to happen. It's just a question of timing.

Okay. Very helpful. And if I could, switching gears over to the data center front. Some competitors have talked about the ecosystem and supply chain becoming a little bit more challenged with China lockdowns. I was wondering if you could update us on your thoughts if you're seeing any impact as it relates to supply chain issues into the data center end markets? And also, how we should be thinking about the growth rate in terms of your business for data center? You've got a lot of new products that are coming to market early but getting a lot of traction. Is this something that should be growing 20% plus over the next couple of years? And then I had one last question.

Yes. So on data center growth, definitely double-digit growth Scott, I think high teens is probably kind of what we think -- where we think of it. It will depend on the uptick of PAM4 and specifically the long reach products. We're doing very well in the short reach, and that's going to grow at a much faster rate. But the longer-reach products we have to get design ins there. But we think we will. And so this is going to be a good growth driver for us. On the supply constraints, I think it's not so much supply constrained as so much it is that contract manufacturers just not being able to build the quantities that they were -- the rates that they were building at. And so they've reduced their quantities and now I think with the -- as Emeka mentioned, we're starting to hear that things are getting better and going to get back to some degree of normalcy. We'll start to see that ramp up again. So that problem should go away. We're hoping, obviously, by the end of this quarter, we shouldn't see any of that. But a lot depends on the COVID situation in China. But I think at the moment, that's what we're anticipating.

Got you. And lastly, if I could, in recent history, you guys have not been acquisitive, you've been executing on the internal portfolio and doing a great job of getting them on the right track in organic growth. How are you starting to think about, if at all, inorganic opportunities and how they kind of fit into the overall portfolio in the future? Thanks so much.

Yes. That's a good question, Scott. We've always been acquisitive. We've also -- if you look at our businesses, they all come from acquisitions. For a period of time, certainly over the last 5 years, I would say, with the instability in the geopolitical environment and with some of the macro events and then the pandemic and things like that. We haven't really put a lot of priority on that. I think as things start to stabilize, we'll be looking at our balance sheet a little bit more and trying to figure out if there's strategic deals that we can do to help us even further. So it's always been part of that tool kit. I think I would say that we haven't been so much in the last 5 years. But I think going forward, that's still part of our toolkit.

Great. Thanks so much. Nice quarter.

Our next question comes from the line of Christopher Rolland with Susquehanna. Please proceed.

Thanks for the question, guys. As you guys know, I've been into helium and Mining helium for a couple of years now. And unfortunately, the price of helium like a lot of crypto's has gone down pretty considerably. And with that, at least aftermarket price of a lot of gateways have also gone down. And it's our opinion that gateway demand is also going to go down. So we're trying to figure out what that headwind might be? And some of the math that Mohan maybe you gave $5 for pico, $15 for a macro. I guess the first things are helium hotspots really kind of on the pico side of things? And then total helium deployments are almost $900,000, call it, another $100,000 in the channel. So call it $1 million. Are we talking about a total helium sort of content of $5 million for that whole network? Or would you consider it larger than that? So if this were to slow, I guess my point is, is this kind of de minimis for your business? Is this really only a $5 million headwind? Or is it something larger?

Yes. I think, Chris, the first thing is that, look, it varies. We don't price it by every single gateway, it is the same. So I would say it's a little bit more than that. It's certainly more than $5 million, but I think the way to think about this is that the community-based networks have 2 values. One is the crypto side of it, but the other is that they create a community-based network. And those have real use cases that are very valuable for tracking of assets, for tracking, for decarbonization, I mean there's much more value than just the crypto side of things. The crypto value doesn't buy up anything by -- from a company standpoint, we don't really look at that, that much. Obviously, if you're generating crypto while you're using it for something that's used to someone or some enterprise, then that's a benefit to you as you're mining. But I think that's a secondary way to look at it. So we expect over the next 3 to 5 years that the gateways will still continue to grow, probably not at the rate it has been growing. But as I point out that one of the things we look at is, okay, how much capacity is out there now to support sensor growth? Because what it does is for us is really drive the opportunity now for every gateway that's out there to drive additional 30, 40, 50 centers connected to them.

Yes. For sure. Also, I wanted to -- you had mentioned too, I kind of might consider the free options or opportunities that I wanted to follow up on. The first was you guys have PAM for analog products and CDR products. I guess my first question is, have you considered or is there a technological opportunity to enter the active electrical cable market? And then my second question is around proximity sensing. You mentioned the Asian regulations over there. Would love to know what you think in terms of maybe dollars or percentage growth, how you could really reaccelerate that market?

Yes. Let me touch on that one first, Chris. I think that market is definitely going to grow. The challenge is, it's really driven by regulations. When you have regulations, the smartphone manufacturers are forced to include a sensor into their phones. So for sure, in North America, in Europe, most of Europe, they have to have them in there. But for many other countries in Asia, like China and India, those regulations don't exist, they may be kind of recommended, but they're not mandatory. So what we're looking for is those regulations to drive -- to mandate essentially, you've got to have some a way to reduce the radio power in your phones when you are close to the human body, and that's what we're looking for. And if that happens, and that was expected to happen last year, it got pushed out, obviously, with the pandemic and now with everything that's going on. Our hope is in the second half, it happens, it may go into next year. But eventually, it's going to and then that's going to drive very positive growth, I think, again, probably in the high teens, double-digit growth. And then your question on...

Active electrical cable market? I don't know if it's transferable or not, but would love your thoughts.

Yes, the answer is yes.

This concludes our question-and-answer session. I'd like to turn the call back to Mohan Maheswaran for any closing remarks.

Thank you. In closing, we were very pleased with our record Q1 results. Despite the challenging pandemic and supply chain environment, our multi-sourcing initiatives and our investments in inventory, infrastructure and tools continue to enable us to support our best-in-class business operations. Our innovative growth engines driving our Smarter Planet initiatives are all doing very well. We expect FY '23 to deliver another record year for Semtech. With that, we appreciate your continued support of Semtech and look forward to updating you all next quarter. Thank you.

This concludes today's conference. Thank you for your participation. You may now disconnect.