Allegro MicroSystems, Inc.

and thank you for standing by. Welcome to the Allegro Microsystems Q1 Fiscal 2023 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during that session, you will need to press star 1-1 on your phone. Please be advised that today's conference is being recorded, and I would now like to hand the conference over to your speaker today, Ms. Leanne Seavers. President of Shelton Group Investor Relations. Deceivers, please go ahead.

Good morning, and thank you for joining us today for Allegra's first quarter fiscal 23 results. I'm joined today by Allegra's President and Chief Executive Officer, Vinit Nargawala, and Chief Financial Officer, Derek D'Antigua. They will provide highlights of our business, review our quarterly financial performance, and provide a summary of our outlook. After the presentation, we will answer questions in a Q&A session. Our earnings release and the accompanying financial tables are available on the investor relations page of our website at www.alegromicro.com. This call is being webcasted and a recording will be available on our IR page shortly. Please note that comments other than statements of historical fact made during this conference call include forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. These forward-looking statements include projections and other statements about future events that are based on current expectations and assumptions and as a result are subject to risks and uncertainties that could cause actual results to vary materially from our anticipations and projections. Please refer to the earnings release issued today and other documents filed by us with the SEC including the risk factors discussed in detail in our most recent 10-K filed on May 18, 2022. While we may elect to update forward-looking statements at some point in the future, the company assumes no obligation to update any forward-looking information presented, even if our estimates or assumptions change. Also, unless otherwise noted during the call, all references to income statement-related financial measures other than revenue, will be to financial measures not prepared in accordance with generally accepted accounting principles or GAAP. Please refer to our press release posted to our website for information regarding our non-GAAP financial results, a reconciliation of our GAAP and non-GAAP financial measures, and certain pro forma financial information. The non-GAAP financial measures that are discussed today are to replace or be a substitute for the presentation of Allegro's GAAP financial results and may be calculated differently than similar measures used by other companies. We are providing this information because it may enable investors to make meaningful comparisons of core operating results and more clearly highlight the results of our ongoing operations. It's now my pleasure to turn the call over to Allegro's President and CEO, Vineet Nargalala. Vineet, please go ahead.

Thank you, Leanne, and good morning and welcome to our first quarter earnings call for fiscal 2023. I'm pleased to join you for my first earnings call as Allegro CEO. It is an exciting time to leave the company as I believe Allegro is at a key inflection point in its growth journey. Before diving into the quarterly business update, I want to take a minute to share with you what compelled me to join the Allegro team. Over my years in the various industrial markets, including automotive, industrial automation, and clean energy, I've always admired Allegro's product and technology focus and its deep relationships with its customers. And the company has built on that by becoming a high quality business with strong fundamentals and solid execution. Allegro has a talented team with a culture of innovation and a strong partner network. The company's solutions and roadmaps are very well aligned to a number of secular mega trends that include electrification, autonomous capabilities, safety, and efficiency. That will have a profound impact across automotive and industrial markets. I've served these markets before from different vantage points in the value chain, and I believe there's a real opportunity to meaningfully scale the business and accelerate the company's growth. Since formally assuming the role in mid-June, I've spent a significant portion of my time meeting with our global teams and customers to gain a deeper understanding of Allegro's business, technology, market positions, and more importantly, what will make us a better partner and employer. These interactions have reinforced my hypotheses and turned them into conviction. I'm fully aligned with our core value of innovation with purpose and believe our products and technology can unlock significant growth, including expanded applications in existing markets, new end markets, and global expansion. As I consider what has made the company successful so far, it is Allegro's unique value proposition with innovative IC solutions, that meet customers' exacting performance requirements as well as its agility and responsiveness to their customer needs. Fundamental to this value proposition is a commitment to and a culture centered around innovation, including the introduction of differentiated technology and products. I believe that innovation leads to market leadership, which in turn delivers differentiated margins and financial performance. While I don't anticipate major changes to the overall strategy that has served us well so far, I do believe there's an opportunity to do more. As part of my initial plan, we will aim to get even closer to our customers and find new ways to energize our growth, while also executing better as a team. While we will continue to focus on and grow with secular growth trends and automotive, I see a future for the right growth. that reaches well beyond auto and extends our growth with these megatrends to industrial markets like clean energy, data centers, and industry 4.0. Our experience and technology serving these trends in automotive will be leveraged to help us grow in these other markets. Electrification and autonomous functionality are large secular growth stories that will play out over the next decade, and I believe Allegro can play a pivotal role in moving technology and the world towards this exciting future. You can expect us to enhance our focus and align our R&D investments towards more growth in these areas. You can also expect us to deploy our capital towards selective M&A to accelerate our strategic growth initiatives. I also believe we have a terrific opportunity to make ESG a foundational part of a value proposition going forward. I look forward to providing more updates as I learn more about the business and the opportunities that lie ahead of us. Now, let me turn to our results for the fiscal first quarter. The company achieved another record quarter of revenue of $217.8 million with both sequential and year-over-year increases. Customer demand remains very strong, especially in our automotive and industrial target markets, and we continue to ramp the capacity of our integrated supply chain to meet it. The top-line performance reflects Elegro's strategic alignment to fast-growing markets, our continued content and share gains, as well as sustained design wind momentum. In terms of underlying business trends and drivers, we continue to realize growing traction with our new products targeted at our strategic growth areas. Design wind momentum was strong, demand continued to increase, and we exited the quarter with record order backlog. Our automotive business had another solid quarter, with sequential and year-over-year growth in all of our automotive applications, led by accelerated adoption of our IC solutions for XCV inverter and onboard charging applications. Complementing our traction in vehicle electrification, we sought continued customer adoption of our cross-portfolio content in ADAS solutions for advanced braking and steering applications. Combined, e-mobility, which represents our XCV and ADAS applications, expanded to a record 38% of automotive revenue in the fiscal first quarter. Key design wins include BLDC motor drivers in electric vehicle HVAC systems and battery cooling, with Allegro winning multiple sockets per system. Our industrial markets saw record revenues, with solid double-digit growth sequentially and year-over-year. Growth was broad-based, punctuated by growth in electric vehicle charging infrastructure and sustained momentum in data center, which increased sequentially for the fourth consecutive quarter and more than doubled year over year. The superior energy efficiency offered by Allegro's power IC solutions for data center cooling continues to resonate with customers. Our overall pipeline of both secured and prospective design wins is very robust, and we expect our recent growth momentum in data center to continue over the coming quarters. This quarter, we were pleased with multiple design wins from our current sensors in solar inverters for renewable energy systems, and we closed key motor driver wins with a leading power tool company where high voltage ICs were required to support their next generation battery technology. From a product line perspective, growth contribution remained well balanced across both our magnetic sensor and power IC solutions, with each increasing sequentially to quarterly records. Specific to magnetic sensors, third-party research has independently confirmed our market leadership, accelerated by recent gains in current sensing across a broad set of automotive and industrial applications and GMR-based solutions delivering leading performance in vehicle ADAS. We see this as a confirmation of our commitment to innovation and our focus on a global customer base that sees Allegro as a trusted innovator, partner, and supplier. At the Sensors Converge Conference in June, Allegro introduced two new magnetic position sensor ICs for ADAS applications. These new angle sensors leverage the first-ever combination of our Hall magnetic sensing technology together with cutting-edge TMR technology in a single package, resulting in significantly improved resolution, accuracy, and safety for vehicle driving automation. Lastly, I want to provide a quick update on Allegro's plan acquisition of Hay Day integrated circuits. We're excited about the Hay Day team joining Allegro and bringing products based on their technology to our customers. All required approvals remain on track, and we look forward to closing the acquisition this fall. In summary, we had a great start to our fiscal year. The strength of our first quarter results is a testament to Allegro's strong alignment with large secular growth trends, persistent innovation, and solid execution. Together with our team, I look forward to building on this foundation and accelerating our growth in our strategic focus areas. I'll now turn the call over to Derek to review the financial results and provide guidance for our fiscal second quarter. Derek?