Lattice Semiconductor Corporation

Greetings and welcome to the Lattice Semiconductor first quarter 2025 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rick Mache, Senior Director of Investor Relations. Please go ahead.

Thank you, operator, and good afternoon, everyone. With me today are Ford Tamer, Lattice's CEO, and Lorenzo Flores, Lattice's CFO. We will provide a financial and business review of the first quarter of 2025 and the business outlook for the second quarter of 2025. If you have not obtained a copy of our earnings press release, it can be found at our company website in the investor relations section at latticesemi.com. I would like to remind everyone that during our conference call today, We may make projections or other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such statements are predictions based on information that is currently available and that actual results may differ materially. We refer you to the documents that the company files with the SEC, including our 10-Ks, 10-Qs, and 8-Ks. These documents contain and identify important risk factors that could cause the actual results to differ materially from those containing our projections or forward-looking statements. This call includes and constitutes the company's official guidance for the second quarter of 2025. If at any time after this call we communicate any material changes to this guidance, we intend that such updates will be done using a public forum, such as a press release or publicly announced conference call. We refer primarily to non-GAAP financial measures during this call by disclosing certain non-GAAP information Management intends to provide investors with additional information to permit further analysis of the company's performance and underlying trends. For historical periods, we provide reconciliations of these non-GAAP financial measures to GAAP financial measures that can be found on the investor relations section of our website at latissemi.com. Let me now turn the call over to our CEO, Ford Tamer.

Thank you, Rick, and thank you, everyone, for joining us on our call today. This has been a period of historic volatility and uncertainty around the new tariffs as they affect the global economy and our industry. In general, we're not seeing any material impact from the new tariffs at this time, and we are highly aware of potential indirect impact. As a result, we, like others in the semiconductor industry, are actively monitoring the situation. especially as it relates to potential impact to our second half outlook. To that end, we're being highly proactive by continuing to focus on cost controls, increase operational efficiency, and above all else, deliver value for our shareholders. At the same time, we continue to aggressively execute our strategy, diligently deliver on our product roadmap, and prioritize and support our customers' deployments. We have also expanded our new design win rates on small and mid-range FPGAs at record levels. Let me now turn to Q1 highlights, which Lorenzo will expand upon in his prepared remarks. At a high level, we delivered revenue of $120.1 million in line with our prior guidance. Our non-GAAP gross margin of 69% reflected the resilience of our business and the value of our product in the face of a challenging environment. And our 33.4% adjusted EBITDA demonstrated the results of our financial discipline. In the near term, we continue to shift below estimated true demand as we work closely with customers to ensure alignment with our evolving product needs. As the broader industry navigates a dynamic macro environment, we're encouraged by the continued improvements in our bookings. With respect to end markets, communications and computing delivered its first year-on-year growth in two years, and industrial and automotive grew 6% sequentially. marking its first quarter of sequential growth in six quarters. The broad reach of our innovative and differentiated solutions is enabling us to expand our footprint in both general-purpose and AI-optimized servers, as well as in industrial applications such as factory automation and robotics. Design wind momentum remains at record levels. Revenue from our new products continues to grow at a strong double digit pace, both sequentially and year on year. I'm also pleased to report that we remain on track to hit our goal of high teens percentage of new product revenue for the full year 2025. Our customers continue to express enthusiasm for Lattice's differentiated low power and small size solution for their mission critical applications. Lattice is uniquely positioned to help enable the next wave of innovation across key verticals, which we expect will be a powerful catalyst for our business. In mid-March, we showcased our innovative solutions at Embedded World in Nuremberg, one of the industry's top industrial and automotive events. Our exhibit featured compelling demonstrations of Lattice technology across a broad range of high-growth applications, including security, far-edge AI, video, and connectivity. In addition, we had the full slate of very productive meetings with key customers and partners, during which we reinforced our strategic relationships and aligned our roadmaps. These discussions further built on our pipeline of opportunities that we expect will translate into future designs and revenue growth. We recently wrapped up our internal quarterly business reviews that showed continued momentum in our Nexus and Avant product families. We continue to take share in the small to mid-range FPGA market segments. We're also seeing revenue and design wind growth in exciting areas like generative AI in data centers, robotics in industrial, in-cabin and ADAS in automotive. AR, VR, and consumer, and emerging security needs, including post-quantum cryptography. All of this reinforces our strong belief that LALIS is well-positioned, not just for a recovery, but for sustainable growth. Overall, we have confidence we are in the right market with a leadership product portfolio and more than 11,000 global customers in very attractive long-term growth markets. Looking ahead, we continue to expect a U-shaped recovery long-term. Our Q2 guidance reflects our expectation for steady growth in both revenue and profitability. Another positive indicator is that channel inventory is also continuing to decrease. And as we discussed in my opening remarks, we remain cautious on the second half outlook aligned with the rest of the industry. This will be dependent on the continuing resolution of the tariff situation and corresponding customer demand. To wrap up, Q1 was a solid quarter with results in line with expectations and strong execution across the board. We remain focused on driving innovation and expanding our customer engagements. The team at Thaddeus is confident, energized, and committed to our long-term strategy and excited by the many opportunities ahead. Thank you again for your time and your continued support. Let me now turn the call over to Lorenzo for a detailed review of our results. Lorenzo?