Lattice Semiconductor Corporation

Greetings and welcome to the Lattice Semiconductor second quarter 2026 earnings call. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rick Muscha, Vice President of Investor Relations. Thank you, Rick. You may begin.

Thank you, Operator, and good afternoon, everyone. With me today are Fouad Tamer, Lattice's CEO, and Lorenzo Flores, Lattice's CFO. We'll provide a financial and business review of the second quarter of 2026 and the outlook for the third quarter of 2026, followed by a brief overview of AMI and its business model. If you have not yet obtained a copy of our earnings press release, it can be found at our company website in the investor relations section at latticecemi.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 contained in our projections or forward look statements. This call includes and constitutes the company's official guidance for the third quarter of 2026. 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 offer 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've provided reconciliations of these non-GAAP financial measures to GAAP financial measures that can be found on the investor relations section of our website at lattice-semi.com. With that, I'll turn the call over to our CEO, Fouad Tamer.

Thank you, Rick, and welcome everyone to our second quarter earnings call. Lattice delivered exceptional financial results this quarter, reflecting a healthy market environment, compelling catalysts, and our own strong execution. We have a focused and consistent strategy built to create durable value by growing faster than the markets we serve. We do this by expanding into new applications, serving leadership customers, Delivering differentiated innovation and driving sustainable shareholder value as a result. We are executing against each of these strategic elements and the results are increasingly visible across the business. Following last week's clause of the AMI acquisition, Lattice is now positioned to deliver even greater value to customers and our shareholders. You will hear more about this acquisition shortly. First, let me update you on our second quarter results and outlook. Revenue for the second quarter was a record $201 million, representing 18% sequential growth and 62% year-over-year growth, with strengths across all our end markets. Our compute and communications end market reached another record revenue level, growing 18% sequentially and 83% year-over-year, driven by continued momentum in data center AI applications. Demand for latest solutions continue to be fueled by increasing CapEx, increasing AI content per server, expanding FPGA attach rates, rising security requirements, and the shift towards and more complex disaggregated architectures. We also saw a continued recovery in our industrial and embedded end market with revenue up 17% sequentially and 36% year over year. We see momentum building across a diverse set of end markets including industrial automation, aerospace and defense, medical, robotics and other Emerging Physical AI Applications. These applications increasingly require our latest differentiation in low power, small form factor, low latency, and secure processing. With channel inventory at healthy levels and multiple new design wins beginning to run, we expect industrial and embedded to remain an important contributor to growth through the balance of 2026 and beyond. As we had anticipated, profitability continued to grow significantly faster than revenue, with second quarter non-GAAP EPS of 53 cents, representing growth of more than 120% year over year. This outstanding performance underscores the operating leverage we have built into the model. We expect this momentum to continue based on demand trends building across our major end markets. This is evidenced by accelerated bookings and our backlog extending well into 2027. At the same time, design wind momentum remains healthy across our FPGA portfolio and end markets. As demand continues to strengthen, we remain focused on working closely with our supply chain partners to ensure that we can support our customers' growth plans. Taken together, we expect these trends to support a sustained multi-year growth outlook. Turning now to AMI, we're pleased to announce the successful close of the acquisition last week. It brings together Lavis' leadership in low-power programmable FPGAs with AMI's industry-leading firmware and infrastructure manageability portfolio. And it positions us to create the industry's most complete secure management and control platform for AI data center infrastructure. We expect that this combination can double our addressable market. In the three months since the announcement of the transaction, we have engaged with about 100 hyperscalers, OEMs, ODMs and ecosystem partners, including many at Computex in Taiwan. And uniformly, they have all given us Thank you. Thank you. We expect the business to be operating at the revenue run rate of more than $200 million with gross margins above 75% and EBITDA margins above 40%. These metrics underscored strengths of AMI's market position, the depths of its customer relationships, and the highly efficient operating model the company has built over many years. The AMI business is well-balanced with approximately 60% of revenue generated from its boot firmware franchise and 40% from its infrastructure manageability solution. Revenue includes firmware licensing, royalties, and platform enablement services. This model creates strong visibility, attractive lifetime economics, and durable customer engagements across long product cycles. We see multiple avenues to grow AMI over time, winning more platforms, increasing content per platform, and expanding further into AI infrastructure and embedded markets. This includes new trends such as rack scale architectures, secure boot, data center manageability, and remote monitoring and control. AMI will continue to operate with the same open silicon neutral approach that has earned it the trust of customers and partners across the industry for decades. We are excited to welcome the AMI team to Lattice and we have already hit the ground running together. Looking forward to the third quarter, our revenue guidance for our FPGA business of $220 million at the midpoint represents approximately 65% year over year growth. When adding two months of AMI revenue contribution, Our revenue guidance becomes $255 million at the midpoint, putting us at over $1 billion annualized revenue run rate. This strong outlook reflects our confidence in the accelerating momentum of the business and the breadth of demand across our end markets. The midpoint of our EPS outlook is 56 cents, which reflects roughly 100% year over year growth. The powerful operating leverage in our model to differentiate the value of our products and our disciplined approach to scaling lattice. We expect that we'll be able to consistently drive earnings growth that significantly outpaces revenue growth. Looking ahead, accelerating AI infrastructure demand, the emergence of physical AI, and the addition of AMI create a powerful foundation for Lattice's next phase of growth. Thank you very much.

Thank you, Fouad, and good afternoon, everyone. I will begin with a review of Lattice's second quarter 2026 financial performance, followed by our outlook for the third quarter. We'll then close with a brief introduction to AMI and its business model. Q2 financial performance was exceptional, exceeding the high end of our guidance. Revenue reached a record $201 million, growing 62% year over year and 18% quarter over quarter. Earnings growth continued to outpace our revenue growth and exceeded the high end of our guidance. Q2 non-GAAP EPS at 53 cents a share demonstrated significant leverage, growing more than 120% year over year and 29% quarter over quarter. Q2 non-GAAP gross margin was above expectation at 71.7%, up 170 basis points quarter over quarter, and up 240 basis points year over year. Q2 gross margin benefited from favorable product and customer mix. Q2 non-GAAP operating expense was $67.1 million, up approximately 10% sequentially and 30% on a year over year basis. The sequential increase was primarily driven by continued R&D investment. Performance-based bonuses and commissions associated with our stronger revenue and profitability also contributed. Our Q2 non-GAAP operating margin expanded 390 basis points sequentially to 38.3%, while our EBITDA margin increased 340 basis points to 43%. Gap net cash flow from operating activities for the second quarter of 2026 was $88.3 million, compared to $50.3 million in Q1. Free cash flow in Q2 was $81.3 million, with a 40.4% free cash flow margin, up from $39.7 million and 23.2% in Q1. Strong financial performance and the fact that we paid out our 2025 annual bonus and Q1 were factors in the sequential improvement of cash flow. In summary, Q2 demonstrated the strength and leverage of our financial model with non-GAAP EPS growth significantly outpacing revenue growth. Now for our guidance, which will include our FPGA business and approximately two months of the AMI business given the closing at the end of July. Our FPGA business continues its accelerated growth trend Revenue is expected to grow into the range of $210 million to $230 million. AMI revenue for the partial quarter is expected to be between $33 and $37 million. In total, lattice revenue is expected to be in the range of $245 million to $265 million. Gross margin for the FPGA business is expected to be 70% plus or minus 1% as we continue to manage our supply chain and costs in the face of increasing pressure. Combined, Lattice Q3 corporate gross margin is expected to be 69.5% plus or minus 1% on a non-GAAP basis. This guidance reflects transitory issues in the AMI business, and I'll discuss those in more detail shortly. We expect non-GAAP operating expense to be between $83 million and $90 million on a combined basis. Most of the growth in OpEx will be in R&D and reflects our continued disciplined investments to drive long-term, sustained revenue growth. We expect income tax rate for Q3 to be between 4% and 6% on a non-GAAP basis. We expect non-GAAP EPS to be in the range of $0.54 and $0.58 per share. In summary, our Q3 outlook continues to reflect strong revenue and earnings momentum, with EPS growth expected to once again significantly outpace revenue growth. This underscores the leverage in our model and our ability to scale profitably while continuing to invest in long-term growth. Earlier, Fouad provided a strategic overview of AMI in his prepared remarks. I'll provide additional color on the business model and the near-term factors that will affect comparability as we integrate AMI. I will also cover the acquisition financing. AMI brings a highly attractive business model that is closely aligned with Lattice's long-term financial framework. We expect the base revenue of greater than $200 million in 2026 will achieve significant growth in 2027. AMI has built a very profitable business with gross margins in the mid to high 70% range and EVA dot over 40%, which should improve our already strong business model. As AMI is integrated with Lattice, we expect to see meaningful accretion to EPS starting in Q4. AMI revenue is primarily driven by firmware licensing, recurring maintenance and subscription revenue, and per-unit royalties that scale with customer platforms over time. AMI also provides platform enablement services that support customer adoption and help establish durable long-term royalty streams. One of the transitory issues referenced above is a low-margin hardware pass-through business that is not core to AMI's strategic value. AMI began proactively divesting this business before the acquisition. While we expect this non-core business to be fully exited by the end of 2026, Q3 and Q4 will include this revenue. Completing the exit in Q4 should structurally expand AMI's margin profile in line with our expected go forward model. We anticipate that any other adjustments will be normalized by the end of 2026 as well. To reiterate, as we integrate AMI, we will show accretion across our business model with meaningful accretion to EPS starting in Q4 while we enable additional strategic growth opportunities. Regarding the acquisition structure, we purchased AMI for $1 billion in cash and 5.2 million shares of our stock. We funded the cash portion of the acquisition with $925 million of financing and $75 million of cash from our balance sheet. We put in place a financing structure with a $1.15 billion credit facility consisting of a $950 million term loan, drawing down only $925 million of it, and a $200 million revolving credit facility. We were pleased with the strong participation from a high-quality syndicate of financial institutions, reflecting confidence in the Lattice AMI combination. Given the strong free cash flow profile of the combined company, we currently plan to reduce leverage to below two times EBITDA by the end of 2027. In closing, this has been an incredible few months for Lattice with our record Q2 results, our closing of the transformational AMI transaction, and our record Q3 guide. We are very well positioned for strong near-term growth as well as the next level of strategic growth with accelerating revenue, earnings, and cash flow generation. Operator, that concludes our formal remarks. We can now open the call for questions.

Thank you. We will now be conducting a question and answer session. If you'd like to ask a question, please press star 1 on your telephone keypad. Confirmation tone will indicate your lines in the question queue. You may press star 2 if you'd like to move your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions.

Our first question is from Quinn Bolton with Needham & Co.

Please proceed with your question.

Hey guys, congratulations on the continuous strong results and outlook. I guess Ford just wanted to start with the comes in the compute business, obviously very strong growth in AI data centers in general purpose as well. But wondering if you could talk about trends you're seeing in terms of FPA attach rate per server, dollar content, or ASP per FPGA. Have you seen those trends continue to increase sort of on a quarter-to-quarter basis here in 2026? And then I've got a follow-up.

Thank you, Quinn. A few things that are worth noting this quarter. Number one, the latest DigiTime report shows the server time is now up to 20 million units forecast for 2026, which is a really strong growth, much stronger than prior year. And so we're seeing the agentic revolution still continuing, and we're seeing that drive and not just the AI server, but more traditional server networking, storage, all the cloud infrastructure that goes along with this inference and agentic revolution. So that has helped our business because we participate in both. We participate strongly in the AI attached server and clients. We also participate in the supporting infrastructure, the cloud infrastructure. So we're really happy about that. The attach rate continues to grow. The capex continues to grow. The new applications continue to grow. The ASP of some of the new products continue to grow because we're coming in now with further and more complex security requirements, as an example. And we continue to be very positive on the characteristic of our FPGAs, such as low latency, determinism, parallel processing, connectivity. Wide range I.O. These are the 1.2 to 3.3 volt I.O. in the data center connecting up to 1,200 sensors and some of these servers together. And so RFPGA continues to find use cases in numerous new applications such as, for example, power and cooling.

Excellent. Thank you for it. And I guess maybe for Lorenzo, as you bring AMI on board, it looks like it has gross margins in maybe the mid to high 70s, I think you said. Thank you for joining us.

Yes, so I'll try to answer your question in near term and long term. We are benefiting right now in our business model from very, very strong revenue growth. But if you look underneath, we continue to invest. AMI is also a R&D-heavy organization because they continue to invest for the future. So the model that you see right now is probably – Approximately what we'll see for the next little bit. And as we get into 2027, and if our longer-term growth aspirations manifest themselves, we see a little bit better performance in our business model than we may have been expecting before. So 70-ish percent on the gross margin and A little bit sooner to 40% on the operating margin level than we had seen in the past. Probably we were taking it. But that's also, if you keep in mind, that's in the face of, or with the accelerated revenue growth we're expecting. So with that model, you'd start to see very significant acceleration in EPS as well. Excellent.

Thank you.

Our next question is from Christopher Rowland with Squana International Group. Please proceed with your question.

Hi there. Maybe just following up on the last question about gross margin. Lorenzo, I think you said there was a hardware business associated with AMI. How much revenue is that hardware business? Was that on top of the $200 or does that Thank you very much.

Divest the hardware part of the business while maintaining the royalty stream. So it's not, from the lattice perspective overall, it's not a meaningful amount of revenue. And by Q4, it won't have an impact on our overall financials or actually even the AMI-specific financials. So it's just something that we wanted to point out because it does cause a Q3 little step down from what we were expecting. Okay.

Okay, and was that revenue on top of the 200?

Oh, thank you. The $200 million a year run rate for AMI would exclude that in the end.

Okay, excellent. Thank you. And then perhaps a follow-up. I'll talk about INA. I think the situation with INA is Maybe they didn't understand we were in a new semiconductor cycle and we're kind of holding back spending. Any update on bookings there? Has it accelerated? Have they finally got the message? And I think we, back in the day, we're talking about maybe a $75 million normalized run rate for that business. But it now appears... Maybe to be higher, particularly with the guide, I would imagine it's higher. Can you talk about INA and what's happening there with the channel, what a new normalized level is? And that would be great. Thank you.

Yeah, thank you, Chris. Our industrial and embedded segment is doing great. INA is doing good. and we have talked about the really strong sequential and year-over-year growth and we see this continue to grow throughout the rest of the year. The PMI now is at levels, they're very positive levels worldwide. There's a bit of a temporary slowdown in China but continue to be very excited about the design wins, the physical high momentum and The recovery of that business. The channel is inventory is now where we needed to be. We're not focused as much on the channel inventory anymore as we focused on supply being the main focus. And very positive on all the different segments, including some of the new robotics and humanoids were doing quite well. Some of the new autonomous vehicles, new medical application, new aerospace and defense. So the list goes on on penetrating a few new market segments and accelerating the growth into 2027.

Let me just add on, one of the things we are not, at Lattice, we are not impacted by is automotive. It's a relatively small business for us. So that end market weakness is not having a drag on us.

Excellent, thank you guys.

Our next question is from Melissa Weathers with Deutsche Bank. Please proceed with your question.

Hi there, thank you for the question. I wanted to touch on something you just talked about, the supply side. With everything seeming like it's coming back pretty hard, can you just talk about any constraints that you're seeing on the supply side, how you're managing it, and could this actually gate your growth going into next year?

Yeah, thank you, Melissa. As I said, we're doing good on sort of the fab side at the front end and the testing side on the back end. In the middle, on the assembly side, there are constraints across the industry right now. and so us and the rest of the industry are experiencing these constraints. We are putting capacity agreement in place and then qualifying new capacity that we believe will get us in line, supply and demand in line by September and we should be in good shape in Q4 and definitely for 2027. Great.

And then on AMI, congrats on getting the deal closed. I know you've talked about your SAM I think doubling with the inclusion of AMI. So can you just talk about is there any like new kind of long-term growth rate framework that we should be thinking about for FPGAs? Is there like an adder to whatever percent growth you could have grown in the past? Just any help on how we can think about AMI layering like actually accelerating your FPGA sales. I think that would be helpful.

Yeah, so Melissa, a couple of things I'd like. Number one, from a long-term aspirational goal, we'd like to hit 3 billion by 2030. So that's the goal. We are already ahead by about a quarter. So if you look at, we had three months ago said that we'll hit a billion run rate by Q4. And the combination of LARIS plus AMI, we just hit this on our guide in Q3, a quarter ahead. So we're... You know, seeing the benefit of this, we should exit this year at a 1.2 billion run rate. And so you could see where our growth is accelerating.

Thank you.

Our next question is from Kevin Gerrigan with Jefferies. Please proceed with your question.

Yeah. Hey, team. Congrats on the great results. Hey, Ford, just on the supply question. With these new negotiations that you're doing, are any of your manufacturing partners trying to negotiate higher prices, and can you pass those along to your customers?

Yes, the costs are increasing across the industry, not just costs from supply chain point of view, but a whole bunch of expedite fees because the customers are all under pressure to negotiate. to get supply ASAP. So we're seeing the cost increase across the industry. And we're doing the best we can to absorb some of these costs. And we're going to have to pass some of these costs. So it's going to be a mixture of absorbing some and passing some.

OK, great. And then you continue to see strong bookings, strong backlog kind of all the way into 2027. I mean, has that visibility extended? over the last three months, and how much of that backlog is non-cancelable?

Very good question. The visibility is increasing daily. I mean, it's really unprecedented. We've got visibility all the way to the end of 2027. 2027 is pretty much booked, and so we're seeing that to be very strong. We are putting capacity agreements in place with our supplier where we're going to have to take the capacity. And so we are, in turn, putting capacity agreements with our customers and partners to make sure that our customers provide us with the same commitments. So, yes, I mean, I think you're seeing this across the whole supply chain now, us with our supplier and us with our customers, putting all these agreements in place.

Okay, perfect. Congrats again on the great results. Thank you.

Our next question is from Ethan Potasnik with TD Cohen. Please proceed with your question.

Yeah. Hey, guys. Congrats on the results. Just a near-term question. You guys guided the standalone FPGA business. But I was wondering, could you guys help us think about the sort of the relative growth rates across the various segments as we move through the second half?

Yeah, so we do break down an FPGA business. We do break down our columns and compute and our industrial and embedded. So those have been broken down, and you can see that the columns and compute has been growing very strong. So this Q2 was 83% year-on-year growth, 18% sequential. Industrial Embedded, 36% year-on-year growth, 16% sequential. We haven't broken this up for Q3. On the AMI side, we expect AMI to grow about 25% year-on-year. So that would give you all the three major segments.

We're seeing strong demand across our end markets, though. And I'll just say the industrial and embedded business has been Blumpy in the past and probably going to behave that way in the future, but the general trend is upward.

Okay. Okay, great.

Very helpful.

And then last quarter, the team suggested AI-related revenue would sort of approach 25% of company revenue in 26. I was wondering if there was an update there and sort of how AI demand tracked during the quarter and where within that opportunity that growth is sort of coming from.

No, we're on track to meet this 25% coming from high revenue and exceeded. We had a discussion, actually multiple discussion around this metric. And what's interesting is the AI, the Atlantic Revolution is driving actually more of the traditional infrastructure. So we're seeing tremendous growth in the traditional supporting cloud infrastructure from servers to networking to storage to memory that drives in turn our FPGA demand. And so... It's a bit harder to just say AI, which if you want to categorize AI as sort of AI with GPU or TPU or XPUs inside, this is the 25%, or where in some cases we assist that. But the other 75% of the business is also growing very rapidly. As you can see, inside our comms and compute industry, Our server business is growing even faster than it comes to compute, which grew at 83% year on year. So you can see the rest of the traditional infrastructure is growing actually at the same rate, if not faster now.

Okay, great. Thank you.

Our next question is from Ruben Roy with Stifel. Please proceed with your question.

Yeah, hi. Thank you. Fouad, maybe just follow up on that last point. Thinking about the server growth, we've heard a lot recently about CPU attach and CPU. You talked about Gentic a little bit in the prepared remarks. I'm just wondering if you could maybe talk about where you are on the CPU side with the core processors. And is that starting to drive some of the growth that you're seeing or is that still on the come? How do you think about that as you think about 2027? Thank you.

Thank you very much. There are some synergy at customers, and we're working together on joint solution. And so that AMI acquisition should be able to help drive a higher growth rate in both the computing comms and the industrial embedded. And in turn, we should be able to help them drive faster growth in AMI itself. So go ahead, Lorenzo.

And just a fresh what Ford said earlier, that in the traditional service, Our attach rate is growing as well. So, you know, one CPU is multiple FPGAs going with it in the infrastructure that's supporting AI. It's a very healthy ecosystem for us.

Yeah, yeah, I got it. Thanks, Lorenzo. Maybe just follow up. Ford mentioned 25% year-over-year growth for AMI. Was that for Q3, your second half? And I guess, you know, kind of the bigger question around that. I think you framed previously that AMI growth was maybe in the high teens, accelerating into 27 off of that rate. And thinking through boot firmware attach rates on servers, could we assume at some point that AMI grows something closer to your own server growth rate?

Right now, just to clarify, when we said 25%, that's our expectations for AMI. I thought that would be helpful for you guys to start building your models. And we are still in the very initial period of integrating. We closed on the 27th of July, and we are beginning to put meat around the bones of the strategy we talked about when we were talking about the acquisition, which is developing these solutions that we'll bring to market in the future that would further accelerate that growth rate. And that we've yet to really quantify, but that is a strategic driver of this acquisition.

Very helpful. Thank you.

Once again, if you would like to ask a question, please press star 1 on your telephone keypad. Our next question is from Srini Pajuri with RBC Capital Markets. Please proceed with your question.

Thank you. For the new products, I think you gave us a target number for this year, roughly 20% to 25%, I believe. Just wondering how that's tracking. And also, given how strong of a growth you are seeing, I just looked at one of your competitors' reporting. and it looks like, you know, you grew 50% over competition. So I'm just trying to understand, you know, is this driven by share gains for you, new products, or is it pricing related? I know you talked about demand being very strong, but just curious to understand how the new product ramp is going. Thank you.

Excellent. Good question, Srini. Thank you. We had guided to that range, and now we're going to exceed the high end of that range. So we expect new products this year to exceed the 25% of total revenue. So as you can see, our new products are doing fine and definitely contributing to that growth rate. And then the growth rate is across all our markets. So we're seeing it in computer comms, we're seeing it in industrial embedded, and we're going to start seeing it with AMI. So we're quite excited. The one thing, Srini, I wanted to point out is recently I've been reading these reports about people talking about the rule of 60. It used to be the rule of 40, now the rule of 60. And the rule was like adding CAGR plus EBITDA percent margin. And I just want to point out we're at a rule of 105 right now. So we're above 100. We'll enjoy it for both Q2 and Q3. We're not promising to do this in the future. But 62% growth and 40% plus EBITDA. It gets us to about 105. So you could see not just the revenue growth, but also DPS and profitability growing faster than revenue growth. So we're excited about that.

Got it. That's very helpful. And then on the AMI, you know, the 25%, I just want to clarify that it's 25% over 200 million because you did talk about some hardware cost to revenue. Yes. Okay, that's correct. That's correct. There's 25% over the 200 million. Yes. Got it. So my question on that, Fouad, Lorenzo, is that it's a pretty solid growth. It's a very healthy environment out there. I'm just curious. I mean, I know it's early days, but does it include any of the revenue synergies that you talked about, or is it still kind of early days? Is it more of an organic?

It is early days. It is early days on the revenue synergies. I do believe we're going to have revenue synergies on top of that, but this does not include the revenue synergies.

Thank you.

And they'll take a little bit of time to break the market.

Our next question is from Quinn Bolton with Needham & Co. Please proceed with your question.

Hi, thanks. Just had a couple quick clarifications or follow-ups. On AMI, will you report that as a third segment, or going forward, do you plan to put it into comms and compute and industrial embed it?

That's a great question. What we are thinking right now is, as we close the quarter and we report, we're going to talk about the FPGA business as a segment and the AMI business as a segment. And we'll provide revenue and gross margin by those. And we are working right now on how to best articulate the operating margins, given that we're in the process of developing share in infrastructure and support. Will you break out Coms and Computing and Industrial Embedded within FPGA? Sorry, yes. Yes, I should have said that. Within FPGA, we'll give you the same revenue look we're giving you today.

Perfect. And then I don't know if I missed it. I apologize if I did. But did you say where channel inventory ended the June quarter? Was it below your two-month target that you discussed? Last quarter?

Here's the way we're thinking about it now because we've gone from an environment of having to manage that down to get to the right level. We got there and what we're doing right now with the channel is using it to help us ensure supply to our customers. I think I've said before in different forums, once we got to the two-ish, it would probably fluctuate up and down. That's what we're seeing, but we're staying in that range.

Great. Thank you.

Once again, if you would like to ask a question, please press star 1 on your telephone keypad. Our next question is from Melissa Fairbanks with Raymond James. Please proceed with your question.

Hi, guys. Thanks so much. Can't argue with the rule of 105. That's not a bad target to hit.

It's what we achieved. Melissa, that's not a target.

I know, I know, I know. I'm teasing, I'm teasing. But I had a follow-up question. I know that AMI helps expand your addressable market and how much you can actually address within those markets. In industrial and embedded markets, I'm assuming, especially as we get into more of like robotics or some defense applications, automotive, some of these more highly regulated applications, is the go-to market a little bit different even with AMI than it is in the compute segment?

Yes, I think there's going to be tremendous opportunities for AMI and Lattice to work together industrially embedded because These systems are very big on the need for platform firmware and for infrastructure manageability. And the early meetings, we've had many meetings with Computex in Taiwan, we've had many follow-on meetings with other partners on physical AI, and very excited about how the integration of AMI and FPGA can offer new solutions to customers. Stay tuned. We'll have a lot more to say on that in the future calls.

Great. Thanks so much. That's all for me.

We have reached the end of the question and answer session. I would like to turn the floor back over to Rick Muscha for closing comments.

Thanks, everyone, for joining us on the call today. will be attending the following investor events this quarter. The KeyBank Technology Leadership Forum on August 11th, the Jefferies Semiconductor IT Hardware and Communications Technology Conference on August 26th, and lastly, the Benchmark TNT one-on-one conference on September 10th. Thank you very much for your participation and have a good evening.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.