Skyworks Solutions, Inc.

I welcome to Skyworks Solutions' fourth quarter fiscal year 2024 earnings call. This call is being recorded. At this time, I will turn the call over to Roger Gill, Vice President of Investinations for Skyworks. Mr. Gill, please go ahead.

Thank you, operator. Good afternoon, everyone, and welcome to Skyworks' fourth fiscal quarter 2024 conference call. With me today is Liam Griffin, our chairman, chief executive officer, and president and Chris Sinisal, chief financial officer for Skyworks. This call is being broadcast live over the web and can be accessed from the investor relations section of the company's website at skyworksinc.com. In addition, the company's prepared remarks will be made available on our website promptly after their conclusion during the call. Before we begin, I would like to remind everyone that our discussion will include statements relating to future results and expectations that are or may be considered forward-looking statements. Please refer to our earnings press release and recent SEC filings, including our annual report on form 10K for information on certain risks that could cause actual outcomes to differ materially and adversely from any forward-looking statements made today. Additionally, the results and guidance we will discuss include non-GAAP financial measures consistent with our past practice. Please refer to our press release within the investor relations section of our company website for a complete reconciliation to GAAP. With that, I'll turn the call over to Liam.

Thanks, Raji, and welcome everyone. Skyworks executed well during the fourth fiscal quarter of 2024. We posted revenue of 1 billion and 25 million. We delivered earnings per share of $1.55 and generated free cashflow of 393 million. Revenue, gross margin, and EPS met or exceeded the midpoint of our guidance. Our business model continues to deliver robust cash generation. For the second year in a row, annual free cashflow was well above 1.6 billion, providing a strong foundation to invest in our technology and product roadmaps to support future growth. In mobile, our revenue grew 21% sequentially, and we expect further growth in the December quarter as customer orders and channel inventory have normalized, and we continue to support seasonal product ramps. Based on our technology leadership position and in close collaboration with our mobile customers, we expand our reach, develop -in-class high-performance connectivity solutions, and drive more integration with advanced packaging, reducing the footprint, and increasing energy efficiency. We believe that AI is poised to ignite a transformative smartphone upgrade cycle, propelling the demand for higher levels of RF complexity. As AI capabilities continue to advance, smartphones will evolve into more sophisticated and intelligent companions, demanding more powerful solutions to support their enhanced functionalities. We are in the early stages of this multi-year trend, and Skyworks is well positioned to capitalize on it. In broad markets, we have seen signs of stabilization and have grown modestly since the bottom in the December quarter of 2023, despite uneven demand dynamics and high customer inventory in certain segments. Long-term, we remain bullish on broad markets, given secular trends in Edge IoT, automotive electrification, and advanced safety systems, as well as AI-enabled workloads, driving cloud and data center upgrades. In Edge IoT, demand continues to improve as customers adopt Wi-Fi 6E and 7 systems, which carry higher dollar content due to increasing complexity and additional bands. We are in the early stages of a multi-year upgrade cycle with Wi-Fi 7 shipments now ramping. As we indicated at the beginning of the year, inventory levels in traditional data center and wireless infrastructure remain stubbornly elevated, which is delaying the recovery. We continue to undership natural demand. However, over the medium to long-term, we remain bullish on our product roadmap and design win funnel, targeting AI data centers. Lastly, global demand remains muted in automotive and industrial markets, as tier ones and OEMs work down excess inventory. Despite near-term headwinds, we continue to convert design wins into revenue across our connectivity, power isolation, and digital broadcast solutions for the connected car and EV markets. Turning to our quarterly business highlight, we secured 5G content for premium Android smartphones, including Google Pixel 9, Samsung Galaxy, OPPO One Plus, and several others. We expanded our Wi-Fi 7 design win pipeline with Linksys, Charter, Netgear, CommScope, and TP-Link. For emerging IoT applications, we powered advanced audio solutions for wireless gaming and clinical-grade hearing aids. Lastly, we increased our design win momentum in automotive, including 5G front-end modules, infotainment, and digital isolators. In summary, the Skyworks team executed well despite a challenging macroeconomic climate. We intend to leverage our robust cash generation to make critical investments that drive long-term profitable growth while diversifying the overall business. With that, I will turn the call over to Chris for discussion of last quarter's performance and our outlook for Q1 of 2025.

Thanks, Liam. Skyworks revenue for the fourth fiscal quarter of 2024 was $1 billion and $25 million, slightly above the midpoint of our outlook. Mobile was approximately 65% of total revenue, up 21% sequentially, as we successfully supported the ramp of new products at our mobile customers. Broad markets were approximately 35% of total revenue, up 1 million sequentially. Gross profit was 476 million, with gross margin at .5% in line with expectations. Gross margin grew 50 basis points sequentially, reflecting our ongoing cost reduction actions. Also, during Q4, we further reduced our internal inventory, resulting in seven consecutive quarters of reductions. Operating expenses were 203 million, reflecting our strategic investments in our technology and product roadmaps. We delivered 273 million of operating income, translating into an operating margin of 27%. We incurred 2 million of other expenses, and our effective tax rate was 8%, driving net income of 250 million and diluted earnings per share of $1.55, which is three cents above our guidance. During the fourth fiscal quarter, we delivered impressive cash generation, with cash flow from operations at 476 million, capital expenditures at 83 million, resulting in a free cash flow of 393 million, or 38% free cash flow margin. For fiscal 2024, we generated well over 1.6 billion of free cash flow, our second year in a row, and ended the year with a record 40% free cash flow margin, translating into approximately $10.40 of free cash flow per share, and a free cash flow yield of approximately 11.5%. We continue to drive robust cash flow through steady levels of profitability, prudent work in capital management, and moderating CAPEX intensity. During fiscal Q4, we paid 112 million in dividends. Cash and investments grew to approximately 1.6 billion, and we have 1 billion in debt, providing us with excellent optionality. Now let's move on to our outlook for Q1 of fiscal 2025. We anticipate revenue of 1.5 billion to 1.8 billion, up 4% sequentially at the midpoint. We expect our mobile business to be up mid-single digit sequentially, driven by seasonal protocols. In broad markets, we anticipate further modest sequential growth, and a return to -over-year growth. The pace of the recovery is more measured than we anticipated, given access inventory in select segments, like industrial, automotive, infrastructure, and networking. Gross margin is projected to be 46% to 47%, and we expect operating expenses in the range of 209 to 215 million, with sequential increases reflecting typical adjustments made at the start of a new fiscal year, including variable compensation accruals. In addition, we are leveraging our strong cashflow generation to invest in technology and product roadmaps, to drive share and increase diversification. Below the line, we anticipate three million and other income, an effective tax rate of 12.5%, and a diluted share count of approximately 160 million shares. Accordingly, at the midpoint of the revenue range of 1.0 billion and 65 million, we intend to deliver diluted earnings per share of $1.57. Operator, let's open the line for questions.

Thank you. Ladies and gentlemen, to ask a question, you will need to press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, simply press star 1-1 again. Given time constraints, we ask that you please limit yourself to one question and one follow-up. Please stand by while we compile the Q&A roster. Thank you. And our first question, coming from the line of Peter Peng with JPMorgan. The line is now open.

Hey, good afternoon. Thanks for taking my questions and good job on the execution. Can you, on your mobile business, can you talk about your Android portion of this and what kind of trends are you seeing? I think your parents talked about some weaknesses there, so I know this is a small appropriate business, but can you elaborate what you're seeing in the Android part of your business?

Sure, absolutely. In fact, we have a very robust pipeline with the Android players, specifically Google. They've been doing a great, great job, and also Samsung. So we have incredible design wins there. Fortunately, they are investing in technology. The performance that we're seeing in those devices has been amazing for us. It's a great match for Skyworks. It gives us an opportunity, really, to demonstrate our technology reach, our scale, and also moving into a diversified portfolio as well. So we're doing very well as a business, and we expect much more in that company.

Right, and Peter, just to level set our Android revenue in more than a billion of revenue we just did in last quarter is less than 75 million of revenue in the quarter. Roughly half of that is with Google. 30, 40% or so is with Samsung, and less than 10% is with the China players. So we definitely have de-risked our position with China. We've talked about that before. We are very selective as it relates to that part of the Android business with Samsung and China. We are playing with those valued customers, but only in the areas where they value what we bring to the table, which is high-performance RF connectivity. That plays out really well with Google, Google who is making a lot of investments in their product roadmap, who are switching the AI-enabled phones that drives a lot more complexity inside the phones, and that's all music to our ears, and that's why we have a strong relationship with them.

Perfect, thank you. And then on the broad market, it's good to see you guys driving, I think for the December quarter, that'll be probably your fourth quarter of sequential growth. I know there's a lot of puts and takes in that business, but as we kind of look into 2025, can you talk about the sustainability of this recovery, or do you think that there's gonna be some seasonality that might impact growth into 2025?

Yeah, and so you're absolutely right. Our broad markets business bottomed in the December quarter of 2023, and we had now three quarters in a row of modest sequential growth. We are guiding to further modest sequential growth in the December quarter, and a return to year over year growth again, somewhat in the mid single digits, year over year growth in our broad markets business. We do anticipate that at a certain point, the sequential growth is gonna accelerate, but we have not really seen that for now. And we all know why that is. There is still some excess inventory in certain markets like automotive, industrial, infrastructure, and networking. We are under shipping natural demand, but eventually that's gonna clear, and eventually our growth is gonna accelerate. We are very well aligned with some secular growth engines in our broad markets, as we talked about in the prepared remarks, edge IOT devices where we see an upgrade from Wi-Fi 6 to Wi-Fi 6C and 7 in automotive with advanced safety systems and electrification, and as well in AI data centers and networking where we play with our timing solutions. And so when I put this all together, we still believe that in the longer term, in a neutral macroeconomic environment, our broad markets business can grow mid teens year over year.

Thank you. And our next question coming from the line of Edward Snyder with Charter Equity Research, your line is now open.

Thanks a lot. Maybe if we touch on guys, obviously with what's going on with the largest customers cause the kind of a little bit of temporary or appears to be temporary upheaval, what you're feeling in terms of 2025, not only for specific guides, know that but it's already clear from our tear down that there's some content changes on the last flagship phone and from what we can gather, there's gonna be some additional changes. There's a lot of things moving, a lot of moving pieces here. What's your view of, let me put it this way, the long term, say 2025 to 2026 in terms of your ability to gain back content and then when they make the big shift and then perhaps grow it from there. I know we've talked to AI in the past about its impact on the RFID given the roadmap that's stretched out for three years, what are you seeing in terms of generic content growth in that kind of flagship front end from AI? And then I have a follow up, thanks.

Okay, okay, I'll unpack that with you here. Yeah, I mean certainly there's a tremendous opportunity for us to continue to grow in mobile. We've got an incredible technology bench. We have the scale, we have the physical plant and we have the flexibility to do what our customers need and I'm sure as you know, we have a very good partnership with our largest customers. So that back and forth is always going our way. We've got great people on both sides to make it work and we expect to have more growth. Certainly we had the last couple of quarters weren't so great but we're popping up now. If you look at the roadmap that we're putting forward, it's very, very potent and we definitely have the team to make that execution done. It's gonna take a little time of course but we have the scale, we have the people, we have the ambition to make it happen and most important, we have the confidence of our most important customer.

Okay, maybe we wanna get follow up. First off, keeping what was the percentage of the largest customer and the second thing, you've been underrepresented at Samsung for a while and again, the stands are shifting there in terms of the RFSV. What's the prospect for that in the next, let's say a year or so in terms of it becoming a larger customer for you given that I think there are more open slots available to you. Are you seeing good design traction in spring or fall or do you get any indication of that at all right now? Thanks.

So in September quarter, our largest customer was approximately 69% of our total revenue which was up 21% sequentially. So the team really executed well, supporting our largest customer, ramping up their new products and I'll turn it over to Liam for the rest of your question.

Yeah, sure, I mean as we spoke, we have this just tremendous opportunity there. We're diving much deeper in some of those platforms and I would say the technology pipeline that we have at Skyworks and the investments that we've been making are really gonna yield opportunities for us in growth. So that's kind of what we're looking at right now. There's a lot of opportunity we're executing. Our engineers are making incredible progress on the next generation solutions. There's a lot more going as you get into the AI world and you can expect that Skyworks is right there ready to go. We're under the hood so to speak with some really incredible people on our side and with our partners. So we should look forward to that. That work is being done now and we look forward to putting that into products very shortly.

Thank you. And our next question coming from the line of Timothy Archer with UBS, the line is now open.

Thanks a lot. Chris, can you talk about what's included for the largest customer for December? It seems like you did see some pull-ins in the September just like most others did. It was a little higher than what I think you thought it would be. Usually that customer's about flat in December but maybe it's down a smidge because of the pull-ins. Can you kind of talk about that?

Yeah, first of all, we can't really go into the specifics as it relates with our large customer but I can tell you that the business and the demand is fully in line with our expectations. So we didn't see any surprise in September, didn't see any or don't expect any surprise in December. The demand is in line with our expectations. And so as I just answered the question before, the large customer was up 21% sequentially in the September quarter and we expect it to be up further in the December quarter in the five to 10% range on a sequential basis.

Great, Chris, thanks. And then I noticed that the repo was quite low despite the strong free cash flow. I might have thought it would have been a little stronger. Can you kind of talk?

Yeah, yeah, absolutely. So first of all, I wanna highlight here as well that we do have very strong free cash flow and as we indicated in the prepared remarks, right, for the second time in a row, more than $1.6 billion of free cash flow and that does take into account that we continue to make the necessary investments in our business. We continue to strengthen our technology and product roadmaps and there's no hesitation there. We know where the opportunities are. We are making the necessary investments there to capture those opportunities. In addition to that, we continue to invest in our manufacturing footprint, although at a much more moderate pace as we have seen in the last couple years, but we continue to invest there as well. And so our free cash flow is very strong. Our balance sheet is very healthy. We have $1.6 billion of cash on the balance sheet and only $1 billion in debt with no near term maturities. And so we have plenty of optionality. We have optionality to do M&A, although you know us, we're gonna remain disciplined, but we have that optionality and we have optionality to return excess cash back to the shareholders through a combination of our dividend program and our share buyback program. On the dividend program, we just recently increased the dividend 3% to now 70 cents per share and so that's turning into a really nice dividend yield. And we have the optionality to do buybacks. The board and the management team are taking into account and into consideration multiple elements, but as a matter of policy, I can't really share the details of those considerations. Having said that, it's our intent to continue to return all the excess cash back to the shareholders over time.

Thank you. And our next question coming from the line of Chris Sankar with TD Cowan. Your line is now open.

Yeah, hi, thanks for taking my question and Liam and Chris, thanks for the call on the December quarter and your large customers. I'm just kinda curious, when you look at the December quarter compared to history, how's the demand linearity trending and what does that imply for March quarter seasonality? I had a follow up.

So again, I will repeat what I just answered on the previous question, right? It is fully playing in line with what we expected. A strong ramp in September followed with further ramp going into the December quarter. Obviously, March is seasonally down. And we expect here again, our March quarter, especially at Mobile, to be seasonally down. Obviously, we only got one quarter at a time, so it's too early to be more specific. We do, however, our broad markets business to continue to grow sequentially and we expect broad markets to be up modestly in the March quarter and beyond. But as combined, of course, for Skyworks, we will have normal or expect normal seasonal declines into the March quarter.

Got it, thanks a lot Chris, really appreciate that. And then a quick follow up on the Wi-Fi 7 upgrade cycle. It seems like it's been pretty good for you. I'm just curious, historically, how long has the drought inflection lasted for a Wi-Fi upgrade cycle and how do you think about how this profile would be versus prior cycles? Thank you.

Sure, sure. Yeah, I mean, actually, you're right. The Wi-Fi cycle had been somewhat muted here for a while. Fortunately, with the Skyworks team, we're in great position. The next generation's Wi-Fi solutions, Wi-Fi 7. We're working with companies like Motorola. We're looking at companies like Logitech. We've got some automotive plays in there as well. So the broad market businesses are coming up. It's been, it had been kind of a rough ride there, but we're starting to look better. Netgear's another player we're in there. Charter Communications. We're in industrial markets. We're engaged with Mercedes-Benz even in the auto side. So there's been a lot of activity and strength here in the broad markets. It's just that the Design One pipeline is filling and we'll get that through revenue. So we're very encouraged about the signs we're seeing there.

Thank you. Now, next question coming from the line of Vivek Arya with Bank of America Securities. Your line is now open.

Hi, this is Michael Mani on for Vivek Arya. Thanks so much for taking our questions. To start just across the various end markets that are on market place, which areas have become maybe incrementally worse or better over the last 90 days and just where are you still under shipping to demand?

So in the market side, there's three parts. There is the edge IoT connectivity where we play mostly with Wi-Fi, but any other wireless connectivity protocol. We've definitely seen improvements in that area. Again, in part driven by a big step up in content as the multi-year transitioning is happening from Wi-Fi 6 to 6C and 7. I think we're still somewhat under shipping natural demand there, but there is definitely improvement in that area. Second part is our networking infrastructure and cloud. I think that's very well documented there. There is access inventory that's being worked down. That will take multiple quarters. I think we start seeing some improvements there. Bookings is improving, backlog is improving, but it's still shipping way under natural demand. And then last but not least, you have automotive and industrial. I think that's very well documented as well by many of our peers who talked about that part of the business. We're definitely under shipping natural demand there. Again, I think we're doing fairly well given some design wins that we have able to put on the book a year or two years ago. Those design wins continue to ramp up and turn into revenue, but it's a soft environment. And so I think that will continue to improve over time here. And that's why as a whole, we are pleased on one hand that our markets continue to grow sequentially, although modestly, but eventually that sequential growth will accelerate. Again, December year over year growth and that year over year growth will accelerate over time as well.

Great, thank you. And then just on gross margins, given that broad markets might be taking a more measured upturn expected previously, what are the puts and takes for gross margin expansion from here? I know you guided the semiconference essentially at the midpoint, but how do you think about expansion into 2025? And then maybe more broadly, as you think about an eventual return to 50% per greater gross margins, what would you rank order as the most important drivers achieve this between utilization, product mix, and a recovery in broad markets or any other factors? Thank you.

Yeah, so as it relates to gross margin, we did .5% in September, which was up 50 basis points. So that's a step in the right direction. For December, we guide 46 to 47, so kind of flattish at the midpoint, but the range is 46 to 47. Looking ahead to fiscal 25 and longer term, as you called out correctly, we drive gross margin improvements through better factory utilization, through cost reductions, and we have a mixed tailwind because broad markets has above average gross margin compared to the mobile. I think the team continue to execute well. We start seeing some improvement on the factory utilization. The team is executing well on cost reductions internally as well as externally, but as we talked already, the mixed tailwind is not blowing as strong as we initially anticipated. I think over time, broad markets will accelerate, but currently the sequential growth is modestly, and so the mixed tailwind there is not as strong as expected. As a result of that, for now, we think that fiscal 25 on a full year basis, gross margins is gonna be flattish compared to fiscal 24. It will, of course, start improving towards the end of fiscal 25 and set us up well for further gross margin expansions in fiscal 26 and beyond. We wanna get as fast as we can back to the 50% gross margin, and then we're gonna keep grinding to our long-term target model of 53%.

Thank you. And our next question coming from the line of, Carl Ackerman with DNP Parimba, C-Line is open.

Yes, thank you. Chris, I just wanted to follow up on that gross margin comment with regard to fiscal 25. I guess,

do

you have an inventory days target? Because you can hear them make good strides in reducing inventory days now in the 130 range, broad markets continue to improve, and so if inventory days are at normal, presumably margins should go up. So again, maybe tie in the inventory days comment with what your comments just were around gross margin and how we see it stepping up over the next couple quarters.

Yeah, first of all, we have been reducing our internal inventory for seven quarters in a row now. It peaked at well above 1.2 billion, and we are down now to less than 800. I think we can continue to drive inventory down a little bit more. Obviously, that's not helping from a factory utilization point of view, it's not helping from a gross margin point of view, but I think it's the right thing to do. We wanna right size the inventory, and I think we still can reduce that a little bit. And so again, when you put it all together there, I think gross margins gonna be flatish, and fiscal 25 start improving towards, and we will have seasonality there, right? We will have seasonality. Typically, gross margins go down in the March and June quarter and then starts improving in the September and December quarter. Inventory days, again, there is seasonality, and so revenue goes up and down. The inventory doesn't follow necessarily the seasonality on the revenue side, but from an absolute dollars point of view, we're sub 800, continue to drive it down a little bit further.

Got it, thank you. As my follow-up, do you believe the M&A environment is more favorable from a regulatory and funding perspective than 25, and if not, because of your very strong free cash regeneration and perhaps ability to further reduce inventory, can you be more aggressive on the buyback, if so, thanks.

Yeah, I mean, there's all kinds of options that we have with the cashflow that we've been putting forth, which is a great, great tool for us. So we're always looking for the optimal mix, whether it's an M&A play or whether another factor. So those are great options for Skyworks, and it's a testament of the ability to drive that cash, and it's gonna be a hallmark of this company. So we look at everything, we're very disciplined, we think about our shareholders, we think about the longevity of the technology, and it's been a strategy that's worked quite well, and I think it will continue to be really purposeful for us as we go forward.

Thank you. And our next question coming from the line of Ruben Roy with Stiefel, Yalan is now open.

Thank you, Liam, I had a question on Edge IoT to start with, and just wondering, how are you thinking about AI impact, if any, on the Edge IoT business? You've talked a lot about the smartphone side of it, just wondering if there's anything that you're thinking investors should be thinking about in terms of AI and potential impacts as we look out over the next 12, 18 months?

Yeah, absolutely, so I think we've got a couple of things. Certainly, on the smartphone side, we are deeply entrenched with the most important customers, learning together, executing, and driving excellence, so that's really, really key, and we're doing great work there. But then now flipping back to the broad markets, we're doing very, very well in the IoT space, and really engaging with companies that are real hallmarks in the business, we talked about Google and Samsung, but also the broad markets businesses. We've got design wins with Mercedes, we have design wins with Nectar, Cambium Networks, Motorola, really, really meaningful companies that are now part of that portfolio that we have in broad markets. And I'm 100% confident our team will continue to drive that with more opportunities, more diversification, and more cash, and more earnings for us. So look forward to that, but things look much better there in that market.

Thanks, Liam. And a couple of quick ones for Chris. Chris, can you tell us about the impairment charge during the quarter and what that was related to, and then finally on CatBags, picked up a little bit. Any initial view on how we should think about CatBags for fiscal 25, thank you.

Right, so we did take an impairment charge in Q4 of fiscal 24, which was related to in-process R&D related to the INA acquisition we did with Silicon Labs. As you probably know, at the time of an acquisition, you have to identify all the in-process R&D projects and have to put evaluation around that. As time goes by, some projects are being accelerated, some projects are being pushed out, some projects are being redefined, and so that's all being taken into account and could potentially result in an impairment charge, which we took in Q4. The business itself that we acquired is part of our broad markets business. We are going through some inventory correction there because a lot of that business plays in the industrial automotive area, but we are still very pleased with that business. That business has great technology, great people, good customer contacts, and as we get through the inventory correction is well positioned for growth. As it relates to CAPEX, CAPEX is running in fiscal 24 on about 3% to revenue, which has been one of the lowest in many, many years. Part of that, of course, is we didn't have to do any capacity expansion CAPEX during fiscal 24, but all the CAPEX we did was mostly for technology reasons. Going forward, we think CAPEX will remain moderate, mid to longer term in the mid single digits as a percent to revenue.

Thank you. And our next question coming from the line of Trini Patchery with Raymond James. Your line is now open.

Thank you. A couple of follow ups. Chris, on the broad market side, there are a lot of moving parts in there, just trying to understand how big auto industrial and IOT and infrastructure businesses are individually. And also you talked about some inventory on the infrastructure and cloud networking. I think you have a bit more exposure on the teleco, so I just want to make sure because from everything that we see and hear, the cloud business is very strong right now. So I'm just curious as to what's causing that inventory build.

Yes, so our broad markets, it's roughly 40, 50% is the edge IOT connectivity. 35, 40% or so is our networking infrastructure in cloud. And then 20, 25% is industrial and automotive. As it relates to cloud and data center, we do see some good traction in the AI related investments that where we play with our timing solutions, but investments in the more traditional cloud and data is somewhat muted and there is still some ongoing inventory correction in that part of the market.

Okay, that's clear. And then I guess on the December guidance, you kind of mentioned that everything is kind of tracking as you expected originally, but it is slightly below your normal seasonality. I think historically you have done kind of high single digits in December. So my question is, is that primarily on the Android side, the weakness or broad markets? And then given the lower base, should we expect your March quarter to be slightly about seasonal? Thank you.

Right, so the revenue and the business with the large customer is fully in line with expectations and more normal from a seasonal point of view. We're guiding slightly below street expectation mostly because of broad markets. Again, on one hand, please that we continue to see for the fourth quarter in a row, sequential growth, but the sequential growth is less than what we anticipated three or six months ago.

Thank you. And our next question coming from the line of Vijay Rakesh with Missile Group, your line is now open.

Hi, Liam and Chris, just wondering on 2025, if you were to take a look at how do you see how should growth year on year and within that 5G and then a follow up.

So we only guide one quarter at a time and we're gonna stick to that. I mean, we're gonna stick to the same thing visibility is I think okay, it's not bad or great, but as a matter of we only got one quarter at a time and we're gonna stick to that.

Right, I was talking more of the industry, but as you look at one of the things that one of your peers have talked about is in China, there's been a trend towards internal and some of the other side moving to discrete. Have you seen any of that? That's it, thanks.

Yeah, we actually don't do much in China in those markets and if we were, they're really low end stuff and so we're naturally kind of out of that space and upgrading more with some of the other players that we talked about earlier, the Googles and Samsungs, et cetera. So we still have a great Android business, it just happens to be a much more important strategic one.

Thank you and our next question coming from the line of Nicola Stoll with Beatham and Company, your line is now open.

Hi guys, thanks for taking my questions. You mentioned tremendous opportunity in Android, can you be any more specific in terms of products or maybe the connectivity, if it's RF or a Wi-Fi type opportunities and I guess I assume that's mostly with Google, thanks.

Yeah, I mean, you have two really strong players here that we're engaging with Google and Samsung and what I really like about those companies is that these are enterprise companies. It's great that they're smartphone players and we can engage, that's wonderful, but they're also technology companies, they're companies that play in AI and other markets. So it's really a great opportunity for us, we're pleased that we're able to engage at that level. We're learning a lot from those customers, very, very smart people with a lot of ideas and a lot of applications. So it's a broad market business of its own within the portfolio. So you should expect more from us with those companies. We're making great progress and looking forward to continuing to raise the bar. So we're happy to be there.

Okay, thanks and maybe just a broader strategy question. You've seen broad markets grow modestly -over-quarter yet you've been under shipping kind of this whole time. So why not halt those shipments more aggressively at the beginning of the year and kind of burn through that inventory quicker? Is there any sort of business strategy around that decision or that's just how business goes, thanks?

I mean, we're always very careful. And when we talk about inventory, we talk about inventory in the channel and at the customer level. And we're always trying to get a good read about that and there's no advantage or any good reason to go and build up channel inventory or access inventory at the customer level. We're always trying to ship in line with real end-customers and customer demand. Now, sometimes our customers don't have it right either and they are pounding the table to get more parts and then their end-customer demand doesn't materialize and you end up with access inventory somewhere in the channel could be at the distribution or could be at the end customer. Nobody wants that and we're always trying to manage that very carefully.

Thank you. Ladies and gentlemen, that concludes today's question and answer session. I will now turn the call back over to Mr. Griffin for any closing comments.

Thanks for participating on today's call. We look forward to talking to you at upcoming investor conferences during the quarter. Thank you.

Ladies and gentlemen, this concludes today's conference call. We thank you for your participation and you may now disconnect.