Littelfuse, Inc.

Good day, everyone, and welcome to the Little Fuse fourth quarter 2024 earnings conference call. Today's call is being recorded. At this time, I will turn the call over to the head of investor relations, David Kelly. Please proceed.

Good morning, and welcome to the Little Fuse fourth quarter 2024 earnings conference call. With me today are Dave Huntsman, president and CEO, Meenal Sethna, Executive Vice President and CFO, and Greg Henderson, Little Fuse Board Director and incoming CEO. Yesterday, we reported results for our fourth quarter, and a copy of our earnings release and slide presentation is available in the Investor Relations section of our website. A webcast of today's conference call will also be available on our website. Please advance to slide two for our disclaimers. Our discussion today will include forward-looking statements. These forward-looking statements may involve significant risks and uncertainties. Please review yesterday's press release and our Forms 10-K and 10-Q for more details about important risks that could cause actual results to differ materially from our expectations. We assume no obligation to update any of this forward-looking information. Also, our remarks today revert to non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is provided in our earnings release available in the investor relations section of our website. I will now turn the call over to Dave.

Thank you, David. Good morning, and thanks for joining us today. Let's start with highlights on slide four. In the fourth quarter, as both sales and earnings were within our prior guided range. The consistency of our performance reflects our global team's strong operational execution and unwavering focus on our diverse and broad customer base as we delivered solid quarterly results amid a mixed environment across our end markets. For full year 2024, we continue to deliver design wind momentum and drive new product innovations alongside our global customers while navigating a choppy environment. We believe our steadfast commitment to our customers positions us to deliver continued long-term top-tier growth. We exited the year with the electronics de-shocking cycle behind us and signs of distribution inventory replenishment emerging. Notably, our electronics segment, Book to Build, Our passive business book-to-bill is above 1, and while power semiconductor remains below 1, we observed improved order rates in the quarter relative to levels seen earlier in the year. As order rates are gradually improving, we continue to see broader design and strength across our diverse technology offering and in-market exposures. We remain confident in our content, a key enabler of sustainability, connectivity, and safety megatrends. We also strove for improved operational performance in 2024 and delivered meaningful profitability enhancements across our businesses, driving solid second-half margin expansion. Into 2025, we continue to align our cost structure to reflect current business and market conditions, while positioning our company for a return to growth and further margin expansion. Finally, we generated strong free cash flow conversion in 2021. strategy. Taking a step back, we are confident our actions in 2024 will support growth and solid earnings expansion in 2025, as well as meaningful long-term momentum beyond the new year. I want to thank our global teams for their focused efforts and persistent hard work in the fourth quarter and throughout 2024. Now let's turn to our in-markets and design activities, starting with the electronics on slide six. Electronics market trends were mixed but improved through the fourth quarter. Data center remained a strong growth driver, in part driven by AI application. Medical demand was mixed, while demand for consumer products, appliances, and building technologies remained subdued. Yet as the quarter progressed, we observed some emerging signs of stabilization, particularly in North America and Asia regions. Broadly, electronics remains healthy, and we delivered another strong wind rate across a broad set of applications in the quarter. Of note, we saw strong taxes, opportunities, and conversion in China, driving meaningful order expansion in the region in the fourth quarter and full year 2024. In North America, we continue to observe some ongoing design wind order conversion delays, but a pickup in order trends late in the quarter was encouraging. Turning to our electronics in-market design wins in the quarter, we secured a meaningful data center win for a cooling application in North America and an infrastructure application in Japan. We secured datacom, server, and compute wins in North America, China, and Taiwan. We also delivered global wins for appliance applications that utilize our broad technology capabilities. Similarly, we secure business for multiple building technology and automation applications in regions including North America, China, Taiwan, and India. Finally, we deliver meaningful wins for medical applications in North America and Europe in the quarter. Moving on to transportation and markets and design wins on slide seven. Starting with our passenger car exposure, we benefited from our global positioning and balanced technology offerings. actions associated with our sensor product line. We delivered solid growth in China as we leveraged our technology expertise, experienced local teams, and strong partnerships with local OEMs. Outside of China, solid demand for our low voltage products partially offset weaker North American and European production volumes in EV sales. In 2025, we believe our exposure to multiple Regarding our commercial vehicle exposure, while SOPS underlying market trends continued in the fourth quarter, we delivered solid volume expansion and continued to drive favorable pricing. Into 2025, we see some initial, albeit early signs of improvement in certain commercial vehicle markets led by construction and heavy duty truck, with recovery likely weighted to the back half of the year. Given our strong content commercial vehicle positioning, and are excited about long-term opportunities across our broad exposures. In the quarter, we secured solid new transportation business across both passenger and commercial vehicle end markets. In passenger vehicles, we secured several meaningful high-voltage opportunities with customers in South Korea, China, and Europe. We also delivered multiple low-voltage fuse winds, including in North America, Europe, South Korea, and China. which demonstrates the global scale of our business. Finally, we secured ADAS application opportunities for customers in China and Europe. In commercial vehicle end markets, we secured several construction and agriculture equipment wins for customers in North America and Europe. We also delivered multiple recreational and specialty vehicle wins in the course. Turning to slide eight, industrial markets and design activities. In the fourth quarter, we observed mixed in-demand trends across our broad industrial exposure. We benefited from continued strong HVAC and industrial safety application demand. However, we observed continued soft industrial equipment, factory automation, and charging infrastructure trends. We continue to see more pronounced softness across our industrial power semiconductor products, where we have more meaningful exposure to weaker European and Asian industrial market Importantly, our industrial secular growth drivers remain intact, and we see continued strong momentum headlined by renewables, automation, and industrial safety. Regarding our design wins in the fourth quarter, we secured meaningful renewable opportunities, including for a solar application in North America and for a solar and energy storage application in China. We also secured several commercial HVAC wins in the quarter, so our teams continued to leverage core to drive new market expansion. In Japan, we secured a win for a rail traction drive application that will utilize our semiconductor capability. Finally, we delivered a variety of wins across heavy industrial markets, including construction, mining, and oil and gas in the quarter. Across our businesses, we continue to partner with our broad customer base to drive innovative solutions for our diverse in-market exposures. We will remain focused on operational execution as we strive to deliver leading performance in 2025. I will now turn the call over to Meenal to provide additional color on our financial performance and outlook.