Applied Optoelectronics, Inc.

Good afternoon. I will be your conference operator today. At this time, I would like to welcome everyone to Applied Opto-Electronics First Quarter 2025 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. To ask a question, you may press star, then 1 on your telephone keypad. To withdraw your question, please press star, then 2. Please note this event is being recorded. I will now turn the call over to Lindsay Savarese, Investor Relations for AOI. Ms. Savarese, you may begin.

Thank you. I'm Lindsay Savarese, Investor Relations for Applied Optoelectronics. I am pleased to welcome you to AOI's first quarter 2025 financial results conference call. After the market closed today, AOI issued a press release announcing its first quarter 2025 financial results and provided its outlook for the second quarter of 2025. The release is also available on the company's website at ao-inc.com. This call is being recorded and webcast live. A link to the recording can be found on the investor relations section of the AOI website and will be archived for one year. Joining us on today's call is Dr. Thompson Lin, AOI's founder, chairman, and CEO, and Dr. Stephan Murray, AOI's chief financial officer and chief strategy officer. Thompson will give an overview of AOI's Q1 results, and Stephan will provide financial details and the outlook for the second quarter of 2025. A question and answer session will follow our prepared remarks. Before we begin, I would like to remind you to review AOI's Safe Harbor Statements. On today's call, management will make forward-looking statements. These forward-looking statements involve risks and uncertainties, as well as assumptions and current expectations, which could cause the company's actual results, levels of activity, performance, or achievements of the company or its industry to differ materially from those expressed or implied in such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as believes, forecasts, anticipates, estimates, suggests, intends, predicts, expects, plans, may, should, could, would, will, potential, or thinks, or by the negative of those terms or other similar expressions that convey uncertainty of future events or outcomes. The company has base forward-looking statements on its current expectations, assumptions, estimates, and projections. While the company believes these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the company's control. Forward-looking statements also includes statements regarding management's beliefs and expectations related to the expansion of the reach of its products into new markets and customer responses to its innovations, as well as statements regarding the company's outlook for the second quarter of 2025. Except as required by law, AOI assumes no obligation to update these forward-looking statements for any reason after the date of this earnings call. to conform these statements to actual results or to changes in the company's expectations. More information about other risks that may impact the company's business are set forth in the Risk Factors section of AOI's Reports on File with the SEC, including the company's annual report on Form 10-K and quarterly reports on Form 10-Q. Also, all financial results and other financial measures discussed today are on a non-GAAP basis unless specifically noted otherwise. Non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation between our GAAP and non-GAAP measures, as well as a discussion of why we present non-GAAP financial measures, are included in the company's earnings press release that is available on AOI's website. Before moving to the financial results, I'd like to note that the date of AOI's second quarter 2025 earnings call is currently scheduled for August 7th, 2025. Now, I would like to turn the call over to Dr. Thompson Lin, AOI's founder, chairman, and CEO. Thompson?

Thank you, Lindsay, and thank you for joining our call today. We are pleased to deliver fourth quarter results that were in line or better than our expectations. We continue to see strong demand in the CATB market and achieve the highest quarterly CATB revenue in AOI's history. During the fourth quarter, we continue to make progress on our data center business with three new design wins with NGCity hyperscale data center customers during the quarter. During the fourth quarter, we delivered a revenue of $99.9 million, which was in line with our guidance range of $94 million to $104 million. We recorded non-GAAP gross margin of 30.7%, which was above the top end of our guidance range of 29% to 30.5%. Our non-GAAP loss per share of $0.02 was in line with our guidance range of a loss of $0.07 to pray even. Total revenue for our data center products of $32 million increased 11% year-over-year, but was down 28% sequentially due to inventory digestion on one product by one of our customers. During the quarter, we began several new qualification efforts to support existing qualifications on 800G products with several large hyperscale customers. Total revenue in our CATV segment was $64 million, which increased more than six times year over year and increased 24% sequentially, largely driven by continued shipment of our 1.8 gigahertz amplifiers for one of our major MSO customers. As we have discussed on our prior earning calls, our MSO customers are in the process of upgrading their outside plan networks so that they can support higher bandwidth in the return page direction and eventually enable DOSIS 4.0. With that, I will turn the call over to Stephan to review the details of our Q1 performance and our Q2 statement.