Allegro MicroSystems, Inc.

Good morning and welcome to Allegro Microsystems' four-quarter and full fiscal year 2026 earnings call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jalene Hoover, Vice President of Investor Relations and Corporate Communications.

Thank you, Aliyah. Good morning, and thank you for joining us today to discuss Allegro's fiscal fourth quarter and full fiscal year 2026 results. I'm joined today by Allegro's President and Chief Executive Officer, Mike Duke, and Allegro's Chief Financial Officer, Derek D'Ancilio. They will provide highlights of our business, review our fourth quarter and full fiscal year 2026 financial results, and share our first quarter outlook. We will follow our prepared remarks with a Q&A session. Today's call includes remarks about future expectations, plans, and prospects, which are forward-looking statements. Such statements are based on current expectations and assumptions as of today's date and are subject to risks and uncertainties that could cause actual results and events to differ materially from those anticipated or projected on today's call. The company assumes no obligation to update these statements except as required by law. For a discussion of these risks and uncertainties, please refer to today's press release and the risk factors contained in our periodic violence with the SEC. Additionally, we will refer to non-GAAP financial measures during today's call. Today's earnings press release, which is available on the investor relations page of our website at www.alegro-micro.com, Contains important information about our non-GAAP financial presentation and also includes reconciliations of our non-GAAP financial measures to the most directly comparable GAAP measures. This call is also being webcast and a replay will be available in the events and presentations section of our IR page shortly. It is now my pleasure to turn the call over to Allegro's President and CEO, Mike Duke. Mike?

Thank you very much, Delene, and good morning. Good morning. Thank you all for joining our fourth quarter and full fiscal year 2026 earnings call. We finished fiscal year 2026 with strong momentum, delivering a fifth consecutive quarter of sales growth at $243 million. Fourth quarter EPS was 17 cents, nearly tripling year over year. FY26 sales increased by 23% year-over-year to $890 million, and EPS more than doubled to $0.54 per share. This performance is a result of our team's dedicated execution of strategic initiatives discussed at our February Analyst Day. In automotive end markets, our focus auto sales, which includes XEV and ADAS, increased 30% at FY26. Content expansion and share gains drove this growth. FY26 growth included gains in steering and braking for ADAS applications, increased adoption of high-voltage traction inverters, and ramping programs for VLDC motor drivers in XEV powertrain systems. As a result, total auto sales grew 17% in fiscal 2026, well above our SAR plus 7% to 10% target coming off an inventory digestion period. Industrial and other end markets led fourth quarter sales growth with data center up 41% sequentially to establish a new quarterly record at 14% of total sales. For fiscal 2026, industrial and other end markets grew 38% led by data center and robotics and automation. This is well above our high teen sales growth target for our industrial business. Our high-efficiency motor drivers for three-phase data center fans continue to gain traction. Historically, these fans cooled CPUs and GPUs, but they've now expanded into power supplies and into network switching equipment. We're also seeing growing adoption of our high-speed current sensors in power supplies, battery backup units, and capacitor backup units across the data center. Our data center content is not limited by unit volume growth. We are seeing strong growth as a result of our expanding product portfolio and the adoption of new high voltage data center architectures. As AI racks move from 15 kilowatt to one megawatt of power consumption, Allegro's content scales with power per rack. Because we solve the thermal and sensing challenges that come with extreme power density, Our content opportunity per act scales from approximately $150 in today's servers to over $425 in next-generation AI configurations. I'd like to share a few highlights from my trip to Asia last month, where I met with our top data center customers in Taiwan and Vietnam. Three things stood out. First, customers expect data center fan volumes to grow for the foreseeable future, even as liquid cooling is adopted. Continued growth is driven by fan proliferation into power supplies and into network switching equipment, which use a large number of fans and are rarely liquid cooled. Second, design when activity for our current sensors in power supplies and backup systems is large and growing. Both Hall and TMR current sensors are shipping or will soon ship across multiple hyperscaler platforms in AC to DC, BFC, and DC to DC power stages. Current sensors for data centers are emerging as a meaningful new growth pillar, and we expect this to be an area of significant growth over the next several years. And finally, we're seeing significant design in progress for high-voltage gate drivers and data center power supplies. In addition to the data center's record performance, robotics and automation sales doubled year over year in fiscal 2026. We saw increasing adoption of our sensors in factory and building automation applications during the year, along with growing engagement and design wins with humanoid robotics customers. For example, we secured two design wins with leading Chinese robotic companies for use in robotic joints during the quarter. In the first win, our current sensors were selected over local alternatives based on superior performance and our smaller package size. In the second win, our latest inductive sensor was selected in an approximate 90 IC per robot opportunity, where small form factor, high precision motor control capability, and our local coil design expertise were decisive factors. Initial shipments will begin in calendar 2026. with volumes expected to increase in 2027. Now turning to design win and backlog momentum, our fiscal 26 design wins increased more than 30% year over year. Focus Auto, including XCV and ADAS, led automotive design win activity, with powertrain agnostic safety, comfort, and convenience also achieving strong results. Data Center led industrial design wins for the full year, In addition, we exited the year with total company backlog sitting at a multi-year high. These metrics give us confidence in our forward-looking momentum. Our R&D investments are guided by our core value, innovation with purpose, which drives differentiated sensor and power technology. Great pride in holding the number one position in magnetic sensing, reflecting our broadest portfolio and our leading performance in the market. Allegro's magnetic current sensors enhance our technology and market leadership positions in output accuracy, bandwidth, and power density. To illustrate this leadership, I'll share some recent examples. In Q4, our 10 megahertz TMR current sensor was named EDN's 2025 Sensor Product of the Year. As the industry's first 10 megahertz TMR IC, it offers the highest bandwidth solution available today, enabling the high-speed control required for next-generation gallium nitride and silicon carbide power systems across XEC, data center, and robotics applications. We also expanded our sensor portfolio during the quarter with the release of an ACIL-D passive TMR angle sensor. This IC delivers the fail-safe reliability essential for the industry's transition to steer-by-wire ADAS systems. Those systems support Allegro's 2 to 3X content uplift compared to conventional steering systems. One of our more differentiated and fastest growing technologies in magnetic sensing is TMR. We expect TMR to extend our leading magnetic sensing position. During fiscal 2026, TMR represented approximately 30% of our sensor product releases. offering a superior accuracy, bandwidth, and low power consumption that our customers demand. We are also expanding our lead in power ICs, which we expect to drive continued share gains. In fiscal 2026, we released our first isolated gate driver specifically designed for silicon carbide transistors and are seeing strong customer interest. Our power through architecture delivers up to 40% greater efficiency And we expect to see a $2 to $3 content uplift from isolated gate drivers as customers move toward 800-volt XEV platforms and higher-power AI architectures. This is a clear example of how our differentiated technology translates directly into content expansion and share games. As we enter fiscal 2027, we see demand trends that support continued growth, and we remain confident in our ability to execute towards our target financial model. I'll now turn the call over to Derek to provide additional color on our financial performance as well as our first quarter outlook.