Ambarella, Inc.

Good day and thank you for standing by. Louis Kierharty, Vice President, Corporate Development. Please go ahead, sir.

Thank you, Michelle, and good afternoon. Thank you for joining our fourth quarter fiscal year 2026 financial results conference call. On the call with me today is Dr. Fermi Wong, President and CEO, and John Young, CFO. The primary purpose of today's call is to provide you with information regarding the results for our fourth quarter of fiscal year 2026. The discussion today and the responses to your questions will contain forward-looking statements regarding our projected financial results, financial prospects, market growth, and demand for our solutions, among other things. These statements are based on currently available information and subject to risks, uncertainties, and assumptions. Should any of these risks or uncertainties materialize or should our assumptions prove to be incorrect, Our actual results could differ materially from these forward-looking statements. We're under no obligation to update these statements. These risks, uncertainties, and assumptions, as well as other information on potential risk factors that could affect our financial results are more fully described in the documents we file with the SEC. Access to our fourth quarter fiscal year 2026 results press release transcripts, historical results, SEC filings, and a replay of today's call can be found on the investor relations page of our website. The content of today's call, as well as the materials posted on our website, are Ambarella's property and cannot be reproduced or transcribed without our prior written consent. Before starting the call, we hope to see you at one of the following investor events scheduled for our first quarter of fiscal year 2027. March 3rd will be at Morgan Stanley's TMT conference in San Francisco. March 10th at Loop Capital's seventh annual investor conference in New York. March 10th to 12th will be at Embedded World in Nuremberg, Germany, and we're offering a limited number of investor meetings. March 11th at Cantor Camp Tours Global Technology and Industrial Conference in New York. We'll be hosting bus tours at our Santa Clara headquarters with Instanet Nomura, Guate, CLSA on March 12th, 18th, and 20th, respectively. March 16th at Bank of America's 2026 Asia Tech Conference in Taipei, and March 24th at the Roth Conference in Dana Point. As a reminder, we'll enter our first quarter quiet period on April 16th, 2026. Fermi will now provide a business update for the quarter. John will review the financial results and outlook, and then we'll be available for your questions. Fermi?

Thank you, Louis, and good afternoon. Thank you for joining us, our call today. Fiscal 2026 established a new revenue record for Amborella. Revenue increased 37% year-over-year, well above the growth in the overall semiconductor industry and most of our semiconductor company peers. Our 5-nanometer new product cycles, together with our customers' new product launches, combine to drive 50% year-over-year growth in our HAI revenue. About 80% of our full-year fiscal 2026 revenue is HAI. all of which is also defined as a fiscal AI. Overall, auto and IoT revenue both grew with company-wide growth in both unit shift and averaging selling price. Our fourth quarter revenue results follow a seasonal pattern with revenue down 7% sequentially, slightly above the midpoint of our original guidance. Our new third-generation 5-nanometer CV75 and the CV72 AI SOCs are rapidly growing, reaching a high single-digit percent of total revenue in Q4, and these new products are poised to be an important source of incremental revenue in the new year. Looking further into fiscal 2027, we anticipate total revenue growth in the 10% to 15% range. with non-GAAP growth margin within our long-term model over 59% to 62%. For the year, we expect our new product cycle to continue to drive both units and the average selling price increase, with revenue growth in both auto and IoT. In addition to the anticipated revenue ramp from CV75 and CV72, the recently announced CV7 our first full nanometer chip is expected to begin to generate revenue in the fourth quarter of this year. By a variety of measures, our team's achievements in the last year have strengthened our edge AI leadership, and we continue to enhance our market position. Financially, in fiscal year 2026, we continue to commercialize our AI investment and deliver premium revenue growth, returning to full-year non-gap profitability. Fiscal 2026 was our 17th consecutive year of a positive free cash flow, with free cash flow for the year of $58 million, or 15% of revenue. We ask you to both our operational and R&D priorities. While facing a variety of industry-wide supply chain constraints, we shipped more than 25 million units across more than 15 SOCs with many variants. And we take out our first full nanometer chip and our first two nanometer gate over around AI SOCs, while successfully bringing CB75 and the CB72 mass commercialization. Our Cooper development platform, while already powerful and well-established, is in a constant state of enhancement, including new agentic capabilities. Strategically, we announced during our CES 2026 product and technology briefing, we are augmenting our direct-to-customer go-to market with incremental initiatives we expect to materially contribute to our long-term revenue growth. First, we are incrementally building an indirect sales channel during including independent software developers, distributors, and the system integrators. We expect this to improve our ability to address the age infrastructure market, as well as the highly fragmented robotic market. Furthermore, in the long run, our existing portfolio should benefit with long tails revenue from small to mid-sized customers we have not directly supported in the past. The second strategic development is the establishment of a semi-customer, semi-custom slash customer ASIC business, where we have strong interest from a variety of companies. Our deep intellectual property, perception engines, AI accelerators, software development platforms, and advanced VLSI capabilities, and established position in the AI market are increasingly valued by companies considering semi-custom or custom ASIC projects. Stepping back for a minute, there continues to be significant industry development with AI agents, applications, content models, and the services that, when combined with our enabling AI SOCs, create an environment where more age and physical AI use cases can practically emerge. Techniques developed in the industry such as distillation and the mixture of experts are enabling age models to become smaller yet smarter, which we expect will enable applications to evolve from early adopters to the mainstream. Altogether, we see a variety of enterprise and the consumer age AI system become real-time, proactive, and able to make close-loop decisions autonomously fully end users through agentics. Of course, with all the breakthroughs, our customers have a lot to learn and evaluate as they consider new AI business cases. The various components of our comprehensive Cooper development platform together with our engineering support are enabling customers to implement new technologies. For example, a power constraint application may need a hybrid AI workload split between cloud and edge. But in other cases where no latency is acceptable, we need to support a vast majority of AI processing on our silicon. Overall, you can see there are many different edge AI applications, use cases, and the trade-offs we must support. And our broad edge AI products portfolios and established powerful development platforms are must-haves to drive the proliferation and diversification of the edge and the physical AI market. I will now discuss some representative customer engagement during the quarter. I want to start by highlighting our industrial automation robotic design wing as the warehouses of a large US-based e-commerce provider. They leverage our N1655 AI SOC to develop a perception hub for the warehouse floor. a fleet of this system is being deployed to enable a high-speed, accurate, and efficient storage and retrieval system at their large-scale warehouses across the country. We are seeing several such physical AI designs starting to emerge on our SOCs. In other IoT applications, we were awarded several projects in the video conference market this quarter. Insta360 launched their Link2 Pro and Link2C Pro high-end web camera based on our H22 SoC. And QSC, a cloud-native audio, video, and control ecosystem company based in California, announced their QSYS high-definition video conferencing PTZ camera designed on our CV72 SoC. They are leveraging our AISP for enhance the video quality and use ai for face detection and intelligent presenter tracking in enterprise security idus a leading security technology customer announced their dcd 3168 security camera based on our 7 cv72 soc and our customer delmeyer based in germany launched their Domira RDF6140 drone camera based on CV25 this quarter. They leverage our AI accelerator to offer several AI features like motion detection, temper detection, intrusion detection, and the line closing. Finally, one of our leading customers, IQSight, previously known as Bosch, announced two new AI products both based on CV72. The FlexiDome 7100i anonymized the image inside the camera for enhanced privacy and compliance. And the D-Linear 7100i detects people and the vehicle accurately with maximum detail in dark, low-light conditions. In our automotive safety, ADAS, and telematics business, I would like to share some key customer wins during the quarter. Ford recently launched the dealer-fit truck bed camera last quarter. It's a smart security camera for the truck bed built on our CV25. It provides real-time truck bed monitoring, leveraging AI-powered intrusion monitoring and threat detection. ThinkWare system in South Korea launched their QXD2 in cottage for video recorder system, which is the first of the kind to leverage our AI ISP neural network on our CV25SLC. Thinkware also used Ambarella's ADAS software stack to enhance perception capability for their forward-facing ADAS. Garmin announced their innovative dual-view based on CV25. It's a rugged two-camera system that enables professional truck drivers an edge in situational awareness. In summary, this 11 representative customer engagements represent the implementation of a wide variety of applications and AI workload. Inherent in these wings is the high degree of programmability and flexibility in our SOC and software platform, enabling us to serve a wide variety of applications with minimal incremental investment while the customer benefits by having the ability to reuse their software and scale. While we are seeing edge AI green shoes emerging in a very diverse range of edge applications, we currently see the largest long-term growth opportunities in the robotics, automotive, and edge infrastructure markets. The robotic market is diverse market in a variety of occasions, fixed factory automation, humanoid, mobile terrestrial aerial drones, and more. we are already shipping into the fixed factory automation market. And Q4 was our first full quarter of a production revenue from the aerial drone market, which we believe is one of the highest value mobile robotic market today. With our industrial automation robotic engagement announced today, we are establishing ourselves in yet another form factor in the diverse and the nascent robotic market. In the automotive market, we have two business, one safety telematics ADAS business, which represents most of our revenue and a majority of our near-term growth opportunity in autos. And also our auto atonement business, starting at the level two plus, which offers long-term growth opportunity. At this time, the auto opportunities, we have either won or been invited to bid upon in the next six years. from fiscal year 2027 to fiscal year 2032 is approximately $13 billion, with the one proportion similar to the last year. In the edge infrastructure market, we are observing early customer opportunity with two different design architectures, one physical AI and the second digital AI. First, enterprise buyers want to run physical AI inference on a local edge gateway to aggregate multi-modal data from multiple sensors pre-processing it in real-time for use cases such as fleet management, physical security, industrial robots. They typically design fully self-efficient agent solutions to process data locally on devices for real-time low latency and secure decision-making that can be summarized and sent to data centers for training and analytics. Second, we see early customer opportunities from enterprise IT buyers for digital AI application that pushes centrally trained and high capacity models to be distilled, quantized and deployed in edge nodes to enable low latency, closed loop automation for secure digital application while still maintaining centralized control in the cloud. In summary, We are an AI market leader across a broad set of criteria. First is our credibility. We have an install base of 42 million AI associates with more than 370 unique customers, AI customer products reaching production, and approximately $1 billion in cumulative AI revenue, primarily from our second-generation CV2 family. Next is our portfolio breadth. We have 12 AG AI SoCs supporting models ranging up to 34 billion parameters. We support up to 100 billion parameters in the future, covering the full breadth of AG AI applications. Finally, our development platform is an established and a critical enablement tool. The Cooper development platform scales across our AG AI portfolio, and multiple applications with customer implementing and region production with more than 200 different model architectures. In conclusion, I'm very proud of the resilience, commitment, and execution of our team in the last year. I'm very excited about our prospect in fiscal 27 and the years ahead. We are committed to our AGIS strategy and driving earnings growth. With that, John will now discuss the Q4 and the fiscal year 2026 results, as well as the first quarter outlook in more detail. John?