Alpha and Omega Semiconductor Ltd

NASDAQ:AOSL

Earnings Call Analysis

Alpha and Omega Semiconductor Sees Strong Growth Across Segments

Alpha and Omega Semiconductor reported Q4 revenue of $151.3 million with a non-GAAP gross margin of 26.4%. Looking ahead, the company expects Q1 revenue of $180 million, plus or minus $10 million, with similar gross margins. Sequential growth is expected in PCs, smartphones, wearables, and gaming. Inventory corrections are largely over, leading to increased demand across segments, especially in AI and gaming. They anticipate continued strength from e-mobility and AC/DC power supplies. The company's move from a component supplier to a solutions provider is expected to drive future growth. Non-GAAP EPS for the quarter was $0.09.

A Year of Recovery and Growth

Alpha and Omega Semiconductor (AOS) reported a strong finish to fiscal year 2024, delivering fourth-quarter results that aligned with prior guidance. Revenue reached $151.3 million, accompanied by a non-GAAP gross margin of 26.4% and an earnings per share (EPS) of $0.09. The results reflect a general market recovery, following inventory corrections that have now largely subsided. While there are still uncertainties regarding the pace of growth, demand is visibly broadening across various segments.

Segment Performance: Strength Across the Board

In the computing segment, revenue rose by 37.6% year-over-year, signifying its crucial role, making up 44.4% of total revenue. Strong demand in tablets, AI applications, and graphics cards helped achieve this, though the PC segment is recovering more slowly than anticipated. The September quarter forecast indicates continued strength, with expected sequential growth driven by PCs and sustained performance in tablets and AI-related sectors. Similarly, the consumer segment is projected to grow low double-digits sequentially, propelled by a seasonal uptick in gaming and wearables.

Communication and Industrial Segments Show Promise

The communications segment performed remarkably well, experiencing a 59% year-over-year rise, largely from a Tier 1 U.S. smartphone customer, and a sequential growth of 2.1%. Looking ahead, AOS anticipates double-digit growth in the September quarter, driven by new smartphone launches. The industrial segment also rebounded with a 15% to 20% sequential growth expected, aided by strong demand in quick chargers and AC/DC power supplies.

Future Outlook and Strategic Directions

Beyond immediate quarterly results, AOS is transitioning into a total solutions provider, aiming to capitalize on the growing demand for advanced computing and greener technologies. The company is optimistic about opportunities in solar, motors, and e-mobility, aligning with global trends toward sustainable energy solutions. Notably, AOS is positioning itself to capture an increasing share of the bill of materials by leveraging its strength in high-performance silicon and intelligent ICs.

Financial Guidance: A Clear Path Ahead

For the September quarter, AOS expects revenue to be around $180 million, with a ±$10 million variance. The company also guides a GAAP gross margin of approximately 25% (±1%) and anticipates a non-GAAP gross margin of 26.4% (±1%). Operating expenses are projected to range between $47 million and $40 million. These solid projections reflect confidence in ongoing growth despite market volatility.

Key Takeaways for Investors

Investors should view AOS's recent performance and future guidance favorably. With inventory corrections largely behind them and a diversified portfolio poised to capitalize on emerging trends, AOS is well-positioned for sustained growth. The transition to a total solutions provider unlocks further potential in new markets, making AOS an intriguing investment opportunity as it targets a revenue goal of $1 billion and aims for a long-term non-GAAP gross margin of over 30%. Continuous innovation in key segments such as AI, graphics, and power management highlights AOS’s strategic outlook amid evolving market demands.

Earnings Call Transcript 2024-Q4

[Operator]

Good afternoon, ladies and gentlemen. Thank you for joining today's Alpha and Omega Semiconductor Fiscal Q4 and Fiscal Year 2024 Earnings Call. My name is Tia, and I will be your moderator for today's call. [Operator instructions]

I would now like to pass the call over to your host, Steven Pelayo with the Blueshirt Group. Please proceed.

[Steven Pelayo]

Good afternoon, everyone, and welcome to Alpha and Omega Semiconductor's conference call to discuss fiscal 2024 fourth quarter and annual financial results. I am Stephen Pelayo, Investor Relations representative for AOS.

With me today are Stephen Chang, our CEO; and Yifan Liang, our CFO. This call is being recorded and broadcast live over the web. A replay will be available for 7 days following the call via a link in the Investor Relations section of our website.

Our call will proceed as follows today. Stephen will begin business update, including strategic highlights and a detailed segment report. After that, Yifan will review the financial results and provide guidance for the September quarter.

Finally, we will have a Q&A session. The earnings release was distributed over the wire today, August 7, 2024, after the market closed. The release is also posted on the company's website. Our earnings release in this presentation includes non-GAAP financial measures. We use non-GAAP measures because we believe they provide useful information about our operating performance that should be considered by investors in conjunction with the GAAP measures.

A reconciliation of these non-GAAP measures to comparable GAAP measures is included in the earnings release. We remind you that during this conference call, we will make certain forward-looking statements, including discussions of the business outlook and financial projections.

These forward-looking statements are based on management's current expectations and involve risks and uncertainties that could cause our actual results to differ materially. For a more detailed description of these risks and uncertainties, please refer to our recent and subsequent filings with the SEC.

We assume no obligation to update the information provided in today's call.

Now, I'll turn the call over to our CEO, Stephen Chang. Stephen?

[Stephen Chang, executive]

Thank you, Steve. Welcome to Alpha and Omega's Fiscal Q4 Earnings Call. I will begin with a high-level overview of our results and then jump into segment details.

We delivered fiscal Q4 results in line with our guidance for revenue and gross margin. Revenue was $151.3 million. Non-GAAP gross margin was 26.4%. Non-GAAP EPS was $0.09.

As we mentioned last quarter, inventory corrections across the majority of our end markets are now largely behind us, and seasonality is returning to more normal live trends. While visibility on the slope of the recovery is limited, the increasing breadth of demand is encouraging.

For the June quarter, we saw sequential growth in each of our major segments with relative strength coming from tablets, AI, graphics cards in our computing segment, gaming and home appliances within consumer, e-mobility, PC motors and quick chargers in the industrial segment and a regional shift towards a Tier 1 U.S. smartphone customer within communications.

The PC segment, however, is taking longer to recover than originally expected. Looking into the September quarter, we expect PCs and service to grow sequentially, while tablets sustained the strong current run rate within computing.

The consumer segment will likely see continued strength in gaming and a strong seasonal pickup from wearables, offset by slower home appliances. Smartphones will drive Sequential growth in communication, while AC/DC power supplies and quick chargers are relatively stronger in Industrial.

Looking beyond 2024, AOS is transitioning from a component supplier to a total solutions provider in many areas where we can leverage our core strength in high-performance silicon, advanced packaging and intelligent ICs to penetrate new opportunities and drive higher BOM content.

We are building on customer relationships to capture market share with a broader product portfolio. For example, we are leveraging our strength in graphic cards and introducing newbie core products for opportunities in advanced computing and AI data centers.

Within smartphones, we expect to benefit from trends towards photopic and multiple screens, increasing AI integration as well as dual cell batteries and higher charging currents for faster charging times. Beyond computing and communications segment, we remain optimistic on the underlying power trends in adjacent markets such as solar, motors and e-mobility, gaming, home appliances and power tools.

These examples all represent continued growth opportunities primarily driven by the global shift towards more efficient and sustainable energy solutions. With that, let me now cover our segment results and provide some guidance by segment for the next quarter.

Starting with computing. June quarter revenue was up 37.6% year-over-year and 4.4% sequentially and represented 44.4% of total revenue. These results were slightly below our original expectation for mid- to upper single-digit growth.

As mentioned before, we saw relative strength from tablets, AI and graphic cards in the quarter, offset by a slower PC market recovery. Notably, tablet revenue was a record high, and the contribution from AI and data center-related applications continue to grow.

We are excited about opportunities in AI. Demand for accelerated cards remain steady as the industry prepares for a platform transition ramping next year. We are working on multiple opportunities, leveraging our existing relationship with a key rapid card maker as well as our product portfolio, including new multiphase decor controllers and power space solutions for advanced computing.

We're also seeing some ramp in September from a leading power supply maker that is a key supplier to the same AI graphic customer. We are selling our high-performance medium voltage marks that go into intermediate bus converters for DC-to-DC power conversion.

Looking forward into the September quarter, we expect the Computing segment to grow mid-single digits sequentially as PC see a seasonal pickup, while tablets AI celebrators and graphic cards remain strong.

Turning to the Consumer segment. June quarter revenue was down 35.5% year-over-year but up 19.7% sequentially and represented 17.5% of total revenue. The results were in line with our forecast for double-digit sequential growth and were primarily driven by gaming and home appliances. It is now clear that the inventory correction in gaming is behind us and in seasonal build, is underway.

The strength in home appliances was better than expected as government incentives in China drove demand. For the September quarter, we forecast low double-digit sequential growth in the consumer segment, driven by strong seasonal pickup from wearables and continued strength in gaming offset by slower home appliances.

Next, let's discuss the Communications segment. Revenue in the June quarter was up 59% year-over-year and 2.1% sequentially and represented 17% of total revenue. These results were above our sequential expectations as we began to see the seasonal pickup from its Tier 1 Smartphone customer, offset by sequential declines from Korea and China OEMs.

Looking ahead, we anticipate double-digit sequential growth in the September quarter on seasonal strength ahead of new smartphone launches in the U.S. and increasing demand from China smartphone OEMs. We are benefiting from a mix shift to more premium phones, and we anticipate rising growth in bomb content as phone makers increase battery charging current.

Now, let's talk about our last segment, Power Supply and Industrial, which accounted for 17.1% of total revenue and was down 33.7% year-over-year, but up 11.3% sequentially. The results were slightly ahead of our forecast for mid- to upper single-digit sequential growth driven by strength in the e-mobility segment for epi and e-scooters and DC pans for applications in areas such as data centers.

The inventory correction in quick charger appears complete as we also saw the beginning of a recovery in the June quarter. Lastly, power tools continued at a steady pace in June. For the September quarter, we expect this segment to grow 15% to 20% sequentially, primarily driven by a solid uptick from quick chargers as well as strength from ACDC power supplies tied to the seasonal build in PC.

In closing, the June quarter was in line with our expectations and marked a solid conclusion to our fiscal 2024 performance. The rolling inventory corrections are we experienced over the past year in nearly every one of our end markets are now largely behind us and some markets like smartphones are starting to return, while new markets when AI are emerging.

We expect seasonal growth in the September quarter, primarily driven by PCs, smartphones, wearables and gaming. Looking to the next cycle, we are poised for growth bolstered by advanced technology, a diversified product portfolio addressing a broadening array of end markets and a premier customer base across all product lines.

Power management underpins key trends such as AI, digitalization, connectivity and electrification, especially as we move towards a sustainable low carbon society. We have set past in executing our technology road map. Customers increasingly view us as a total solution provider, allowing us to capture a greater portion of the bill of materials and ultimately supporting growth that outpaces industry over the long term.

With that, I will now turn the call over to Yifan for a discussion of our fiscal fourth quarter and fiscal year financial results and our outlook for the next quarter.

[Yifan Liang, executive]

Thank you, Stephen. Good afternoon, everyone, and thank you for joining us. Revenue for the quarter was $161.3 million, up 7.5% sequentially and flat year-over-year. Seasonal demand was relatively broad-based in the June quarter and confirmed the inventory correction is largely complete.

In terms of product mix, DMOS revenue was $102.1 million, up 8.8% sequentially and 6.7% over last year. Our IC revenue was $52.7 million, up 5.5% from the prior quarter and down 10.5% from a year ago.

Assembly service and other revenue was $1.4 million as compared to $1.2 million for last quarter and $0.6 million for the same quarter last year. License and engineering service revenue was $5.1 million for the quarter versus $5.1 million in the prior quarter and $6.3 million for the same quarter a year ago.

Non-GAAP gross margin was 26.4% compared to 25.2% last quarter and 28.5% a year ago. The quarter-over-quarter increase was mainly driven by the improved factory utilization. Non-GAAP operating expenses were $39.3 million compared to $38.9 million for the prior quarter and $39.1 million last year.

The slight quarter-over-quarter increase was primarily due to higher professional fees. Non-GAAP quarterly EPS was $0.09 compared to $0.04 loss per share last quarter and $0.19 earnings per share a year ago.

Moving on to cash flow. Operating cash flow was $7.1 million, including $4.5 million of repayment of customer deposits. By comparison, operating cash flow was $28.2 million in the third quarter and negative $28.2 million last year. We expect to refund about $8.4 million customer deposits in the September quarter.

EBITDA for the quarter was $16 million compared to $11.6 million last quarter and $17.7 million for the same quarter a year ago. Now, let me turn to our balance sheet. We completed the June quarter with a cash balance of $175.1 million compared to $174.4 million at the end of last quarter.

Nitrate receivables decreased by $0.7 million sequentially. Day sales outstanding were 12 days for the quarter compared to 15 days for the prior quarter. Net inventory decreased by $2.3 million quarter-over-quarter. Average days in inventory were 148 days compared to 153 days in the last quarter.

CapEx for the quarter was $7.2 million compared to $7.4 million for the prior quarter. We expect CapEx for the September quarter to range from $6 million to $8 million. Now, I would like to discuss September quarter guidance.

We expect revenue to be approximately $180 million, plus or minus $10 million; GAAP gross margin to be 25%, plus or minus 1%. We anticipate the non-GAAP gross margin to be 26.4% plus or minus 1%. GAAP operating expenses to be in the range of $47 million plus or minus $1 million. Non-GAAP operating expenses are expected to be in the range of $40 million, plus or minus $1 million.

Interest expense to be approximately equal to interest income and income tax expense to be in the range of $0.9 million to $1.1 million.

With that, we will open the call for questions. Operator, please start the Q&A session.

[Operator]

[Operator instructions] The first question comes from the line of David Williams with Benchmark.

[David Williams, analyst]

Congrats on the success we get in this volatile macro environment here. Certainly, you're doing a much better job than I think some of your peers have. With that, I guess, Stephen, I wanted to ask a little bit just on the graphics card and some of the data center tolerate DPUs. You talked about this before and starting to see those revenues.

So, I'm trying to understand what you the magnitude of maybe that could be over time? And maybe is there a way to size, understand there's different flavors of varieties of those products. But is there a good way to think about what your content can be and maybe where you're at within that made qualification process? Color around that would be, I think incredibly helpful.

[Stephen Chang, executive]

Sure. Yes. So, an entry into artificial intelligence programs. A lot of that actually is built upon where we've already been with our graphic cards and celebrated cars actually aren't that different from a graphic part in the sense that you're basically powering a high-performance GPU in both cases. But with data center, that performance is requirements are being driven even higher.

So, when we look at the content, actually, the power solution isn't that different in that you have multiple power stages usually drive-up losses that surround that GPU. The same thing happens with the celebrated cards, but in a bigger scale. So, to quantify some of that, so, for example, in a graphic card, you can have anywhere from 9% to 16%, something in that range of number of drive mass per GPU.

But when you move to an AI celebrated card, that number actually jumps up to even up to 50 power stages to power that GPU. And those are the solutions that we are shipping today in our graphics card/AI customer in their existing platforms, and we are working with them on transitioning over to the new platform that they will be launching soon.

So, we believe that for us, the AI celebrated card will be the portion that will grow earlier than other areas, mainly because of our presence already both in graphics cards as well as the AS accelerated heart business that we enjoyed today.

[David Williams, analyst]

And then maybe just can you talk a little bit about the multiphase controller? I know you've mentioned this last quarter, but it sounds like you're getting some nice adoption there some good traction. Just, how is that helping you, I guess, across the breadth of your market? What is the dollar opportunity there? And then maybe what are the benefits longer term as you've introduced that multiphase controller?

[Stephen Chang, executive]

Sure. So, multiphase controller, we first released and deployed that for our client PC business. And you remember that we've been talking about with Intel's latest platforms that bone content is increasing because of what they're doing in bringing back more power rails.

And our solution is actually a total solution. We offer both the multiphase controller, which is new for us in addition to the power stage, and that has helped us to expand the bond content that we can address within a PC application. This is in a notebook or a desktop type of application.

And because we have that foundation, we are working on transitioning that over to the next generation of graphics as well as AI accelerated cards. So, the business I talked about before, in the past, we were only shipping driver losses. And in the future, we're expecting to ship and be able to ship both at the total solution.

So, it's important for us not only to expand the bond content within our current PC application, but it's also allowing us to step into the more advanced say, advanced computing, high-performance GPU area as well.

[David Williams, analyst]

And then maybe one last one for me for Yifan. As you kind of think about the gross margin, you're seeing a bit of an uplift here as we kind of grow through the year, which is positive. But how do you think about the margin profile? And I'm sure I've asked you this almost every quarter. But it seems like that mix is better utilization comes back and then expect to become a larger player in some of these that the EP market or the accelerated market?

It seems like there's some nice room for margin appreciation. Is that fair to say? And maybe how do you think about the margin trending through your FY '25?

[Yifan Liang, executive]

Sure. As you know, our September quarter's margin guidance, we guided flattish quarter-over-quarter. This is mainly because we expect similar quarter-over-quarter factory utilization and we plan to consume some inventories and reduce inventory balance in the September quarter.

So, other factors impacting the margin like the product mix and ASP is that we expect the similar to the June quarter. So, overall, we expect a flattish margin quarter-over-quarter for the September quarter. So, going forward, yes, I mean, I would expect and as we grow our revenue, then our product mix will continue to improve and the factory station will be higher.

So, those factors will be contributing to our margin improvement.

[Operator]

The next question comes from the line of Maja Paper with B. Riley.

[Maja Paper, analyst]

I'm actually calling in for Fidelis. And I was really just wanted to think about this AI data center brand that's coming up in the second half. So, you guys obviously have a lot of work in some very similar environments and can really pursue this, I think, with a really great angle. So, with all the different configurations and approaches to building these AI centers, are you guys seeing different design wins across the spectrum here with all the different ways that someone can approach them?

[Stephen Chang, executive]

Yes. And our big customer has a lot of different end products, and they're catering it to folks building systems, they're catering to both of them on the total solution or they would just want to celebrate card deficit by itself. So, for us, we actually have quite a bit of a number of opportunities at play. But we believe that the updated accelerated card will come first for us because we already have a track record there.

We're already shipping in their older platforms. And going forward, I mean, both the graphics and the accelerated card is expected to share the same type of architecture. And we believe that for us, in terms of design win, turning to revenue. Now that portion, where we will see first ahead of the other business.

And at the same time, we are working on the other sockets that we're developing products for. We're being working on design wins for at the same time in parallel.

[Maja Paper, analyst]

Just to kind of follow up on that. Do you guys have any like quantification as far as kind of how many designs wins, you're on or how many pockets you've kind of tried to pursue the sign wins?

[Stephen Chang, executive]

We don't really quantify that way. But in general, we are seeing design wins and progress on the celebrated card. This is why we're taking about that more now because we believe is a much more tangible and near term for us and lines up the best for us with our end customer. I do also want to mention that and in addition to this business that our business with this customer, we're also working with one that their suppliers that producing and helping to supply into, I think we mentioned on the call, they're intermediate bus converters.

And we also have revenue even shipping today with our medium voltage MOSFETs. So, this is kind of the power stage before it gets to the point of load. And our customer is a big supplier to the AI solidated card, the ratios card maker.

So, we also expect to see that business continue to grow beyond this year into next year as the AI customer moves into their new platform.

[Maja Paper, analyst]

If I could just ask one last thing. Kind of thinking about how margins are going to change as your business kind of picks up into this new realm. Are we going to see a normalization back to kind of like historic peaks around 30-ish or is this sort of a new normal now with 25% to 28% kind of extending forward?

[Yifan Liang, executive]

Yes. I mean our overall midterm target model is still above 30% non-GAAP gross margin with targeting revenue goal of $1 billion. So, that model will still stay. So, we believe when we continue to grow then the incremental business, we exactly coming in better product mix. So, about that would help us improve the gross margin gradually.

Also, this incremental business would help us increase our utilization at factories.

[Operator]

The next question comes from the line of Jeremy Kwan with Stifel.

[Jeremy Kwan, analyst]

Just wanted to [Indiscernible] of interest, obviously, in the AI accelerator cards. Maybe a couple of questions here. First would be, can you clarify if this is consumer cards that are being adapted for enterprise or small data center applications? Or is this architecture deciding on the ground up to be used in AI acceleration and data centers.

[Stephen Chang, executive]

Yes. Our business today is mostly the first in that they use a similar solution for the air brackets cards from their previous platform to address some of the AI needs today. But we're looking forward to and what I talk talking about is that with the new platform that's coming out from this customer end of this year, beginning of next year and that platform is a ground-up kind of completely designed for AI. And that portion also addressing AI-celebrated cards in that portion, this is what we're looking forward to seeing the transition for.

[Jeremy Kwan, analyst]

And then with the new architecture platform, is the socket, it sounds like there's maybe 3 opportunities here. And please correct me if I'm wrong, but one would be the core power multi-base controller, the second one would be the multiple power stages. That's the 50 kinds of DrMOS that you've been talking about.

And then the third would be this intermediate bus converter, which is that the 48-volt like 12-setdown power. Am I framing that correctly?

[Stephen Chang, executive]

Actually, the first 2 are more of the same. So, whether it's on an AI celebrated card or on a mean board, power in the GPU is still the up to 50 power stages powering that. So, the first 2, are the same. Our customer will have different configurations. But in the end, it's still a point of load powering the GPU itself.

So, the second category which I brought up just now is, yes, the immediate bus converter using our medium voltage products. We actually have a number of other products also addressing going after AI. As a whole, ALS is very well connected into this ecosystem already. I'll largely ask because we're already in the graphics as well as the computing ecosystem. A lot of that is shared. And to support this OEM, we're already working with the ODMs that are in Asia that are actually producing the both boards as well as systems for this end customer.

We are also engaged with the power supply maker that's making these intermediate bus converters. We're even addressing various ALS makers as well regarding thermal management. So, for us, ALS is very well suited to go after this market, both directly with OEM as well as indirectly with their suppliers.

[Jeremy Kwan, analyst]

And just to clarify again, just is the controller, the multiphase controller, a piece of this? Or is that a [Indiscernible]

[Stephen Chang, executive]

A product, and especially as they move into the new platform, we are selling the total solution controller, multi-paced controller in addition to the power stage.

[Jeremy Kwan, analyst]

And did you size your opportunity here just from a potential SAM whether it's on a per GPU basis, that any insights there would be very helpful.

[Yifan Liang, executive]

Sure. Well, I'll quantify more at the Board level what the content increases. And then the SAM will really depend on how fast they deploy and how many models do they extend our solutions to. But, as I mentioned before, a graph car uses anywhere from 9 to 16 of these on a board, this number can go up to 50 powering HGPU.

So, it really just depends on the performance requirements of the card and that's going into. So, bank contract on a whole of tripling at least per GBU and then dis-base a configuration, and that's how we much the opportunity can increase.

[Jeremy Kwan, analyst]

And how about the intermediate bus converter opportunity as well as the controller opportunity?

[Stephen Chang, executive]

The controller is part of that, and it's usually with one controller appearing with those multiple controllers pairing with those power stages. With the module solution, we're selling medium voltage max going into it. So, I don't really want to dollarize that here, but it's becoming something that's significant enough for us to talk about it in each of the segment reports, let me just put it that way.

[Jeremy Kwan, analyst]

And just switching gears a little bit to the license and engineering. From the license payments that you're receiving, I believe there was maybe $20 million left a couple of quarters ago. It seems if you give us an update how much license payments you're still fee received? And how much of this was engineering versus licensing?

[Yifan Liang, executive]

Sure. I mean, this contract that is up to early 2025. So, we still have like a couple of quarters to go. So, that's the length of this agreement. So, the agreement in total is for a 24-month period.

[Jeremy Kwan, analyst]

And is the payment on a pretty consistent quarterly basis?

[Yifan Liang, executive]

No. Actually, some tied to the products once we qualify and fully verified by our customer and some portion is paid for our engineering services, which, based on the annual basis, in fact every 12 months, they will pay.

[Jeremy Kwan, analyst]

And is this figure included in the operating cash flow?

[Yifan Liang, executive]

Yes, yes. That's in there. Initially when we receive the payment and we recorded as deferred revenue and then because the revenue recognition is based on the engineering hours and we spent relative to the total estimated engineering hours. So, that's kind of a varying each quarter. So, we recognize the revenue from our deferred revenue.

[Operator]

There are no additional questions left at this time. I will now hand it back to the management team for closing remarks.

[Steven Pelayo]

Okay. Steven Pelayo here. Before we conclude, I'd like to briefly mention 4 upcoming events. The management team will be participating in and will be available for one-on-one meetings at the Fifth Annual Needham Semiconductor and Semi Cap Conference, August 21 virtually.

The 2024 Evercore ISI Semiconductor IT Hardware and Networking Conference, August 27 in Chicago, the Jefferies Semiconductor, IT Hardware & Communications Tech Summit, August 28 in Chicago; and the 2024 benchmark Tech Media and Telecom Conference, September 4 in New York.

If you wish to request a meeting, please contact the institutional sales representative at each sponsoring bank. This concludes our earnings call today. Thank you for your interest in AOS, and we look forward to talking to you again next quarter.

[Operator]

That concludes today's conference call. Thank you. You may now disconnect your lines.