Allegro MicroSystems, Inc.

Good morning and welcome to the Allegro Microsystems first quarter fiscal 2025 earnings conference call. 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 the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Delene Hoover, Vice President of Investor Relations and Corporate Communications at Allegro Microsystems. Please go ahead.

Thank you, Steve. Thank you, Steve. Good morning, and thank you for joining us today to discuss Allegro's first fiscal quarter 2025 results. I'm joined today by Allegro's President and Chief Executive Officer, Vineet Nagarwala, and Allegro's Chief Financial Officer, Derek D'Antilio. They will provide highlights of our business, review our quarterly financial performance, and share our second quarter outlook. We will follow our prepared remarks with a Q&A session. Our earnings release and prepared remarks include certain non-GAAP financial measures. The non-GAAP financial measures that are discussed today are not intended to replace or be a substitute for our GAAP financial results. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in our earnings release, which is available in the investor relations page of our website at www.elegromicro.com. This call is also being webcast and a replay will be available in the events and presentation section of our IR page shortly. During the course of this conference call, we will make projections and other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution that such statements are based on current expectations and assumptions as of today's date, and as a result are subject to risks and uncertainties that could cause actual results to differ materially from projections. Important factors that can affect our business, including factors that could cause actual results to differ from our forward-looking statements, are described in detail in our earnings release for the first quarter of fiscal 2025. and in our most recent periodic and other filings with the Securities and Exchange Commission. Our estimates, expectations, or other forward-looking statements may change, and the company assumes no obligation to update forward-looking statements to reflect actual results, changes to assumptions, or other events that may occur, except as required by law. It is now my pleasure to turn the call over to Allegro's President and CEO, Vineet Nagarwala. Vineet?

Thank you, Jolene, and good morning, everyone. Thank you for joining our first quarter fiscal year 2025 conference call. We delivered results towards the higher end of our commitments while making progress on inventory rebalancing across automotive and industrial markets. Q1 sales were $167 million above the midpoint of guidance and non-GAAP EPS was 3 cents at the high end of guidance. During the first quarter, we made progress reducing inventory in direct and distribution channels. We believe that inventory rebalancing in automotive will continue into our second quarter, and customers are returning to a more normal ordering pattern, which we expect to drive low double-digit growth in the second quarter sales. While industry estimates project a slight decline in calendar year 2024 automotive production, we remain encouraged with the estimates for continued double-digit growth in XCVs, which includes battery electric vehicles and full hybrids. Our industrial outlook reflects the impact of higher interest rates and ongoing inventory digestion. We believe that our industrial and other sales are hovering at the bottom and remain cautiously optimistic about a potential recovery in the second half of our fiscal year, though a return to normal could be well into fiscal year 2026. As we manage Allegro through the recovery, we remain excited about the fundamentals that are driving our end markets and the opportunities that are available to us. We continue to invest for growth, and remain focused on those aspects of the business that we control. To that point, we continue to execute a product and technology roadmap with some major new product introductions in Q1. During the quarter, we announced the launch of the third product in our high-voltage power-through portfolio. Allegra's two-chip isolated gate driver IC solution works with external transformers to provide the freedom to design and maximize power efficiency for clean energy applications. such as solar inverters, XEV charging infrastructures, energy storage systems, and data center power supply units. In our sensor portfolio, we launched new sensor solutions to replace traditional shunt resistors. Our newest plug-and-play sensors provide customers with smaller designs, cooler operation, a lower bill of materials, and simplified implementation to reduce design cycle time. This resonates strongly with customers in fast-growing applications like ADAS, renewable energy, and industrial automation, positioning Allegro for continued success in these markets. We also highlighted our market-leading 48-volt portfolio, which continues to gain traction in automotive and industrial applications, enabling more efficient power supply. Allegro's 48-volt solutions are used today by the leading North American XEV OEM, and we are finding increasing application in the data center market. Our roadmap calls for continued expansion with more 48-volt products expected to hit the market in fiscal 2025. Based on third-party 2023 data, we increased our leadership position in magnetic sensing. The increase in our leadership position is a direct result of our relentless drive to innovate. At Allegro, we take great pride in our market-leading magnetic sensing position. As our solutions continue to build momentum across strategic growth areas, I will share a few highlights from our first quarter design wins. In automotive, we had a multi-portfolio win with the North American OEM for a steering system using our power and magnetic sensor IC solutions. In industrial, our high-voltage power portfolio was awarded its first win with a European solar manufacturer for microinverters, and we secured a large design win using our TMR technology for blood glucose monitoring. During the quarter, we released our second ESG report, where we highlighted ambitious 2030 goals that align with global sustainability trends and focus on renewable energy, gender diversity, and global pay equity. Before closing, I'd like to say a few words about the recently announced transaction to repurchase shares from our largest shareholder, Sanken, who had owned a majority of Allegro since 1990. This event marks the first time in nearly 35 years that Allegro has not been controlled by another company and opens a new chapter in our journey of growth and transformation. The transaction also brings significant governance improvements. Sanken reduced the board presence by one seat immediately after falling below majority ownership and no Sanken appointed director can chair any of our board committees. Our updated shareholder agreement also lays out a transition path for Sanken's presence on our board commensurate with their ownership. The reduction in Sankar ownership combined with the departure of one equity partners from Allegro enables us to be completely independent in our strategies and actions. I'm very thankful to our teams and advisors for the hard work over the past few months to plan and execute this transaction. We believe the increased liquidity, improved governance, and clarity and certainty about our future will act as a catalyst for further value creation. And the timing couldn't have been better. With an improving cycle on the horizon, We are poised for re-acceleration towards the goals outlined in our target financial model. I'll now turn the call over to Derek to review the Q1 financial results and provide our outlook for the second quarter. Derek.