Qorvo, Inc.

Good day, and welcome to the Corvo Incorporated Q4 2021 conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Douglas DeLito, Vice President of Investor Relations. Please go ahead, sir.

Thanks very much. Hello, everybody, and welcome to Corvo's fiscal 2021 fourth quarter earnings conference call. This call will include forward-looking statements that involve risk factors that could cause our actual results to differ materially from management's current expectations. We encourage you to review the safe harbor statement contained in the earnings release published today, as well as the risk factors associated with our business in our annual report on Form 10-K filed with the SEC, because these risk factors may affect our operations and financial results. In today's release and on today's call, we provide both GAAP and non-GAAP financial results. We provide this supplemental information to enable investors to perform additional comparisons of operating results and to analyze financial performance without the impact of certain non-cash expenses or other items that may obscure trends in our underlying performance. During our call, our comments and comparisons to income statement items will be based primarily on non-GAAP results. For complete reconciliation of GAAP to non-GAAP financial measures, please refer to our earnings release issued earlier today, available on our website at corbo.com under Investors. Joining us today are Bob Bruggerworth, President and CEO, Mark Murphy, Chief Financial Officer, James Klein, President of Corbo's Infrastructure and Defense Products Group, and Eric Creviston, President of Corbo's Mobile Products Group, as well as other members of Corbo's management team. And with that, I'll turn it over to Bob.

Thanks, Doug, and welcome, everyone. Corvo concluded our fiscal 2021 with an exceptionally strong March quarter. Quarterly revenue, gross margin, and EPS were well above guidance. Outperformance was driven primarily by 5G smartphones and Wi-Fi 6 and 6E. Demand was broad-based across customers. and design activity suggests continued strength in fiscal 22, supported by multi-year trends in wired and wireless connectivity markets. In smartphones, the adoption of 5G is driving demand for higher value content. Device architectures are increasing in complexity as higher frequencies with wider bandwidths are added, transmit is introduced in the diversity path, MIMO architectures are adopted, and new receive path featuring carrier aggregation. This is placing a premium on Corvo's highly differentiated semiconductor technologies and enabling us to supply an expanding portfolio of products to industry leaders. For calendar 21, we expect 5G smartphones to double versus last year. Within these phones, we expect the RF content to increase $5 to $7 per phone when compared to 4G, including in the mid-tier. Turning to the March quarterly highlights, Corvo achieved record shipments of low, mid-high, and ultra-high band main path solutions and Wi-Fi 6E FEMs in support of leading Android OEMs. On the design front, we continue to expand our content opportunity with the leading Android OEMs by securing complete main path solutions and secondary transmit in the diversity path. In Ultra Wideband, Corvo was selected by a leading provider of consumer IoT products to integrate Ultra Wideband into a broad set of connected home devices. More customers are looking to add Ultra Wideband to their products to take advantage of its superior location accuracy, security, and latency compared to other wireless technologies. Customer interest in Corvo's ultra-wideband solutions has been robust, and we continue to see adoption in smartphones as the catalyst for an expanding ecosystem of connected devices that includes associated peripherals, automobiles, consumer and industrial IOT applications. Finally, in mobile, we're very pleased to have been honored by Samsung with the Best Quality Award recognizing Corvo's innovation and outstanding performance in support of their Galaxy product family. In IDP, Wi-Fi revenue, including Wi-Fi 6, was a record. The rate of adoption of Wi-Fi 6 is outpacing the adoption we experienced for Wi-Fi 5, and the rollout is forecasted to span multiple years across enterprise, retail, and service providers. Corvo is seeing a strong attach rate given the performance advantages we enable related to range, efficiency, signal integrity, and form factor. To that end, we recently secured the entire bill of materials in support of a major US MSO gateway. We also released multiple 5 gigahertz IFEMs that deliver improved band isolation and enhanced capacity and range in tri-band Wi-Fi 6 home mesh networks. In broadband, MSOs are increasing downstream and upstream data capabilities by upgrading to DOCSIS 3.1 infrastructure. During the quarter, we expanded shipments of DOCSIS 3.1 GaN power amplifiers to major US MSOs, offering greater efficiency, longer range, and increased bandwidth to maximize upstream and downstream data connectivity. In automotive, Corvo has for years been successful supporting the increased demand for in-vehicle infotainment. During that time, we've expanded our automotive portfolio and engaged with customers to enable the transition to connected car through cellular V to X. In the March quarter, these efforts helped to generate the first production orders for our cellular V to X front-end modules and bought coexistence filters to support the leading European automotive OEMs. Of note, Corvo's high-frequency block coexistence filters also enable the concurrent operation of cellular VDACs and Wi-Fi. In programmable power management, customer demand has been strong in support of two trends. First, the transition to solid-state drives is ongoing, primarily in laptops and gaming consoles. During the quarter, Corvo's programmable PMICs continue to support this transition with expanded shipments to and new engagements with multiple leading solid state drive providers. Second, the transition of brushless DC electric motors is accelerating, enhancing efficiency and a broad set of consumer products, including power tools and appliances. Corvo increased shipments of motor control solutions during the quarter, supporting multiple major consumer brands. In defense applications, the shift to higher frequencies the adoption of phased array radar, and the proliferation of GAN are among the trends supporting demand for Corvo's products. For radar applications, we released a reconfigurable dual-band GAN power amplifier mimic for the S and X bands, enabling more compact next-generation radar systems. Over 30 million miles away, the successful landing of NASA's JPL Mars Perseverance rover was supported by our components integrated into the rover's descent radar. In infrastructure, we continued to ramp shipments during the quarter to a base station OEM in support of U.S. C-band massive MIMO deployments, and we captured initial design wins for massive MIMO deployments in Canada, Japan, and Korea. Corvo brings decades of technology leadership and wireless infrastructure and we are leveraging the full breadth of our GaN power and small signal portfolio to support OEMs on upcoming 5G deployments. We have strong customer engagements, we are investing in critical enabling technologies, and design activity remains robust. We see tremendous opportunity in 5G infrastructure globally over the next four to five years as deployments continue to roll out. After the quarter closed, we received an emergency use authorization from the FDA for our Omnia COVID-19 rapid antigen test, which leverages high-frequency BOS sensors for high sensitivity and specificity. Corvo began efforts to use BOS sensors to develop diagnostic test solutions in 2013 in a manner similar to how we leveraged our BOS filters to achieve superior frequency selectivity in RF applications. Now with the authorization from the FDA, we are preparing to scale production to help support ongoing public health efforts. To that end, CURVA was awarded a contract with the National Institutes of Health through the Rapid Acceleration of Diagnostics, or RADx, initiative. With $24 million, From the Biological Advanced Research and Development Authority, or BARDA, the award is helping to advance the production and market launch of our Omnia diagnostic test platform. Also after the quarter closed, Corvo acquired NextInput, a pioneer in the emerging field of force-sensing solutions for the next generation of human-machine interface. NextInput will be part of the mobile products providing MEMS-based sensors in innovative products for customers in existing and new markets. They have shipped tens of millions of MEMS-based sensor solutions to leading manufacturers of smartphones, wearables, automobiles, and other applications. We see multiple opportunities for their solutions to augment or displace capacitive touch and mechanical buttons with smaller, more reliable, and airtight solutions that are applicable to any surface, including glass, polycarbonate, aluminum, and carbon fiber. We welcome the next input team to the Corvo family, and we are excited to expand our technology portfolio and accelerate the deployment of the technology to our broad customer base and new markets. Before handing the call over to Mark, I want to acknowledge the entire Corvo team for their commitment to supporting our customers and keeping the world connected. Corvo is enabling multi-year upgrade cycles in existing markets and introducing disruptive technologies, including ultra-wideband, RF-based biotechnology testing, and MEMS-based solutions. We expect broad-based end-market demand for our products and another year of strong financial results. And with that, I'll hand the call over to Mark.