Q3 2021 Synaptics Inc Earnings Call
[music].
For today and add additional colors of our financial results.
In addition to the companies GAAP results management will also provides supplementary results on a non-GAAP basis, which excludes sure based compensation acquisition related costs and certain other non-cash or recurring or non-recurring items.
Please refer to the press release issued aftermarket close today for detailed reconciliation of GAAP and non-GAAP results. Additionally, we would like to remind you that during the course of this conference call Synaptics will make forward looking statements forward looking statements give our current expectations and projections relating to our financial condition results of operations.
Plans objectives future performance of business, including our expectations regarding the potential impacts.
On our business of the COVID-19, the pandemic, although synaptics believes are estimates and assumptions to be reasonable they are subject to a number of risks and uncertainties beyond our control and may prove to be inaccurate synaptics cautions that actual results may differ materially from any future performance adjusted and the companies forward looking statements. We refer you to the company's current and pier.
<unk> reports filed with the SEC, including the Synaptics form 10-K for the fiscal year end of June 27, 2024 important risk factors that could cause actual results to differ materially from those contained in any forward looking statements synaptics expressly disclaims any obligation to update this forward looking information I will now turn the call over to.
Michael.
Thanks, Jason and welcome to today's call, we had a strong start to 2021 and I am pleased with our execution this quarter.
Revenue was in line with our guidance and our continuing efforts to drive Iot growth led to better the normal revenue seasonality with Iot now established is our largest product group profitability remains strong and contributed to another record quarter for non-GAAP gross margins.
Coupled with discipline spending are non-GAAP net income and EPS results were at the high end of our guidance range.
Since Dean and I joined Synaptics, a year and a half ago, we have made meaningful strides in improving the financial foundation of the company.
Are non-GAAP gross margins and operating margins have increased significantly as we shifted our focus and investments toward higher margin products.
Additionally, we built a strong backlog of new design wins across all our product areas.
We've been able to capture new customers and our existing footprint and establish and expand into the adjacent markets setting us up for future revenue growth.
Our profitability has never been better.
And with our strong balance sheet, we are well positioned to pursue growth aggressively both organically and inorganically.
Oh, let me an update you on our business.
And Iot, we continue to aggressively expand and diversify our customer base and and markets across all our product lines.
With our strong backlog and design when momentum we are increasingly confident that we can outpace the 10% to 15% industry growth rate to.
Despite the ongoing impact of supply constraints, we have outsized customer traction that enables us to deliver strong sustainable revenue growth.
Let me share some highlights from our Iot portfolio of this quarter.
Our wireless connectivity solutions continued to scale quickly as many of the new design wins, we've secured over the past nine months and home automation streaming devices and smart watches are beginning to ramp to production.
We are on track of this quarter to double the quarterly revenue run rate for these products from when we closed the acquisition in July of last year significantly exceeding our expectations.
We are confident that the trajectory continues as we begin to market the innovative roadmap products developed for us by broad cop.
Our video interface products continue to outperform as demand for our docking stations remains strong.
As companies begin to returning to the office many will be shifting to a hybrid model, where office hotels becomes more important facilitating reduced corporate real estate needs.
Are universal docking solutions from display link solved many of the problems that can arise in hotels and as a result, we have seen strong demand.
Our traditional one to one docs are also selling well tied largely to the surge in PC unit sales.
New for us as our entry into the protocol adapter and portable docking markets.
Hi, Anne Chip, we announced nearly a year ago as seeing tremendous traction opening up a whole new opportunity within the market <unk>.
Several of products featuring Kyanne are already shipping in retail.
We plan to develop products for lower and higher volume applications in order to extend our video interface franchise.
Our <unk> wins with our two Korean service providers are expected to start production this quarter.
We expect an additional four set top box designs to enter production before the end of this year.
Finally, an automotive we expect additional cars with our TDI solutions will be on the road from a number of Oems in the U S Europe and China as the new model year begins production in the fall.
Now, let me turn to our PC products. This was another record quarter as we performed significantly better than our typical seasonality.
We continue to benefit from the ongoing strength in the broader PC market.
But are also winning new designs, particularly in chromebooks.
We started shipping to our first chromebook customer of last quarter and of fall of that with new wins of two of the top three P. Coes that are expected to be in production later this year.
Our ability to take cost out of these products enables us to compete and grow share in our core touchpad and fingerprint markets at reasonable margins.
And while we continue to look for opportunities to expand asp's with more complex large touchpad designs and innovative key pad fingerprint solutions.
Finally, let me give you an update on a mobile products are.
Our focus on delivering best in class touch solutions for the flexible OLED market continues to result in design wins.
We are now ramping our second generation controller to high volume production, thereby extending our performance lead.
Those technical advantages of led to meaningful diversification for our mold products, including our second win with the large Korean handset OEM for an upcoming mid range phone.
In addition, we continue to win the significant majority of the new flagship class designs for OLED touch with Chinese handset Oems.
Or two wins with the Korean OEM will begin shipping this quarter, while the additional wins with the Chinese Oems will ramp throughout this year and into the next calendar year.
Overall I am extremely happy with the start to 2021, not only are we winning repeat business, but we are beginning to take sure from our competitors and are finding new markets to sell into.
Due to a solid gross margins for the first time, we can take the offensive in the market of <unk> and aggressively drive revenue.
We will continue the practice the discipline that has carried the company for the last six quarters, but we will have a renewed focus on design wins and top line growth.
Now, let me turn the call over to Dean to review, our third quarter financials and provider outlook.
Thanks, Michael and good afternoon to everyone first I'll start with review of our financial results for our recently completed quarter, then provide our outlook for our fiscal queue for.
Revenue for the March quarter was 326 million slightly above the midpoint of our guidance revenue.
Revenue was down 9% sequentially, but perform better than typical seasonality, reflecting the increased diversification of our business and markets.
During the quarter, we had to customers above 10% of revenue at 13% and 11%.
Iot continues to be our largest product group accounting for 45% of revenue in the quarter, while PC accounted for 30% and mobile accounting for 25%.
Our Iot revenue was down 6% sequentially and up 101% compared with the year ago quarter as we benefited from the two new acquisition that we made last year and as new design wins continue to ramp up across our Iot portfolio.
This was another record quarter for our PC products with revenue up 8% sequentially, the $98 million and up 25% year over year as work from home and now returned to the office demand continues to drive strong PC sales globally.
Revenue from our mobile products was down 27% sequentially due to seasonality and down 54% year over year.
For the March quarter.
Our GAAP gross margin was 47, 7%, which includes $18 9 million of intangible asset amortization, four 3 million an acquisition related inventory step of charges and 800000 of share based compensation costs.
GAAP operating expenses and the March quarter were 123 9 million.
Which includes share based compensation of 24 $3 million.
Acquisition integration related costs of eight 7 million consisting of intangibles amortization.
Amortization of prepaid development costs of 2.5 million and restructuring related costs of 1 million.
Our GAAP tax expense.
Was $10.4 million for the quarter.
In the March quarter, we had GAAP net income of 13 $8 million or GAAP net income of 35 cents per share.
Now turning to a non-GAAP results.
Our March quarter non-GAAP gross margin of 55.1% was the record for the company and above the high end of our guidance range, reflecting a stronger than expected product mix tore the Iot during the quarter.
March quarter non-GAAP operating expenses were in line with the midpoint of our guidance at 87 4 million down to $5 million from the preceding quarter.
Are non-GAAP tax expense was $12 million for the quarter.
We had a non-GAAP net income and EPS for the March quarter of 79, 3 million and $2 and the <unk> per diluted share respectively.
As our focus on profitable growth continues to drive positive earnings for our shareholders.
Now turning to our balance sheet.
We ended the quarter was $756 million of cash on hand.
An increase of $439 million from the cash and short term investment balance of the preceding quarter.
Driven by the issuance of $400 million of debt and.
And accompany record of $136 million of cash generated from operations during the quarter.
Offset by the pay off during the quarter of $100 million that was previously outstanding under our revolver.
Receivables at the end of March where $234 million and days of sales outstanding was 65 days.
Our days of the inventory was 42 slightly up from last quarter and ending inventories were $69 million in.
Inventory remains low relative to historic levels and below our desired level do the continued supply chain constraints.
Capital expenditures for the quarter were three 3 million and depreciation was five 3 million.
Now turning to our outlook for the fourth quarter.
We anticipate the revenue for the June quarter to be in the range of 310 million to 340 million similar.
The similar to last quarter, our backlog at the start of the quarter was more than 100% of our guidance range as everyone. In the semiconductor industry continues to weather the supply chain constraints that limit our ability of the service our customers bold demand.
We expect our revenue mix from Iot, PC and mobile products and the June quarter to be approximately 49%.
The the growth sequentially, while PC has affected the can do two anticipated component shortages at the customers.
I will now provide GAAP outlook of our June quarter, and follow with non-GAAP outlook.
Quarter and be in the range of 86 million to $89 million.
We expect our non-GAAP net interest expense to be approximately $5 million in the June quarter.
As a reminder, we issued $400 million of 4% fixed coupon debt in March.
Which will result in $4 million of quarterly cash based interest expense in.
In addition to the interest expense from our existing $525 million convertible notes.
We expect our long term non-GAAP tax rate for fiscal 2021 to continue to be in the range of 11% to 13%.
Non-GAAP net income per diluted share for the June quarter is anticipated to be in the range of $1 85.
To $2 15 per share.
On an estimated 40 million dilutive shares for Q4.
Reflecting the anticipated impact of a higher share price used to determine shares potentially issuable related to our outstanding convertible notes.
This wraps up our prepared remarks, I'd like to now turn the call over to the operator to start the Q&A session operator.
Thank you.
As a reminder, inc. I would like to ask the question you May Press Star one on the telephone keypad COVID-19 J. Your question press the pound key.
Most of the Jason woman to compare of the kinase roster.
And our first question comes from the line of Christopher Rolland. Your line is now open.
Thanks for the question.
I guess first gross margin is this the new run rate, we should think about here.
And.
Perhaps remind us gross margins by segment.
And how they differ so that we can kind of.
Understand what this new trajectory could potentially day. Thanks.
Yeah. Good question, Chris So like I alluded to in my remarks, what we think is the sustainable run rate business.
Now in sort of in the near term is similar to our Q3 results around this 55% level.
Margins in the quarter continued to do well.
It's really related to mix right mix continues to be favorable for us as you know we've been hard at work for the last couple of years on on new products, and new design wins, and taking costs out of our supply chain, where we can and all of that is really culminating into the growth and the gross margins that we've seen over the.
The course of the last seven or eight quarters.
And as far as how does gross margin breakdown between the different revenue product group, we don't break that out in front of that guidance, but.
Iot Gen tends to be higher and.
The PC tends to be lower than mobile sort of in the middle of the two.
Thank you Dean and then following up I know you guys have previously talked about.
8% to 10% kind of growth longer term.
Is that something maybe that we could see next year and then.
Particularly as as is mobile.
It was a little bit softer here in March would it be your expectation for that to come back and kind of layer in on top of the.
Some of the progress we've made here in Iot in PC.
Yeah, I think Chris.
We feel good about the 8% to 10% growth the Dean put out in the last call. I think are are constrained certainly in the next.
Few quarters is going to be supply so we're going to be.
Limited by what we can do on the supply chain as I said in my comments right now we feel like we're doing really well in the market in our core areas. We're executing and then we're winning I think the momentum has definitely turned in our favor and were really beginning to.
To win in the market I'm really really pleased for the for the first time, we can really see.
How would I characterize this outsized traction and the customer base, but I think we're going to be limited.
In terms of what we're able to do by what we're able to get in terms of supply so I'd answer the.
The question that way.
Thanks, so much Michael.
Thanks, Chris.
Next question is from Karl Ackerman. Your line is now open.
Yes. Thank you.
Two questions if I may.
To that two of the last point.
I think it's well known that display drivers and the touch controllers.
Even TDI products are all in tight supply of the foundry level.
Given the Austin, whether the disruption in an attempt of OLED.
And so perhaps that's impacting your supply constraints as you just mentioned, but as a follow up to that can you discuss your ability to secure capacity.
That would allow you to better service of the upside of demand youre seeing today in backlog.
Yes, Carl first of all good question good to hear from you.
I would say that.
We.
We're in the kind of a unique position as you know we have a pretty diffuse supply chain. That's one of the things that we've been trying to get on top of to consolidate the supply chain a bit.
And rationalize the down.
But actually here in the.
The very immediate point, we have had some benefit from that the fact that we do have.
A good number of supply chain.
Partners.
They've they've been relatively opportunistic in terms of price increases and things like that but it has given us additional ability to go and get supply.
So we probably have.
<unk> done better than average I mean for sure the <unk>.
<unk>. The overall semiconductor problem is is the long pole, but we've probably been able to do better than most in terms of working around some of the supply chain chop the challenges and we got a little bit lucky in so far as that that very very diffuse supply chain.
<unk> has given us some near term benefit.
Thanks for that Michael made different Deane.
Clearly the mix shift toward Iot is helping you progressed rapidly toward the new 57% gross margin target.
At the same time many of your peers have raised prices to offset rising century of cost.
I was hoping you could discuss your ability to exert pricing power despite less of your demand generation coming from distribution. Thank you.
Yeah. Good question Carl.
Here in the news that there's lots of peers that are maybe changing prices.
We certainly have a supply chain the pass along some price to us and we.
We've recently passed along some of those of subset to two of few of our customers, where we're we reasonably can.
We certainly aren't looking at this too.
Extract revs.
Revenue of extract margin from many of our customers I think everybody's sort of in the same boat on this one we're just trying to resolve the supply constraints that are out there.
The other thing I would note.
Our gross margin expansion really it's been happening over the course of the last seven eight quarters.
So this has been happening for us.
It's been a methodical process and journey we've been on so.
A lot of the expansion is sort of just from the hard work that we set up in the beginning.
Thank you.
Thanks, Paul.
Next question from Bill Peterson Your line is now open.
Yes, thanks for taking the question.
This job on the execution of especially the continued gross margin expansion.
I guess in the prepared remarks, you talked about potentially.
Going on the offensive if you were.
The gross margins are at a really healthy state I was wondering if you can go into a bit more detail.
Maybe by by your product segments.
Areas like maybe the OLED display drivers or the.
PC space more more of the consumer space, where you haven't.
<unk> been playing as much in the past until recently or an Iot. There is there any particular segments, where you feel that you can kind of attack the market better maybe with some of the newer products like Qatar and any any color you can give on where you are.
We're trying to grow your business from here, Yes, Bill good again I appreciate the question.
Thanks for the thought.
Youre, absolutely right I think that the top areas for us are DD IC right I think that we've talked about that mobile presents an opportunity for us to inflect.
And the second half of our fiscal year, where we think we can we can pick up some some really meaningful share.
The secondary again, you touched on which was was PC.
And there it's chromebooks, we really haven't had much of a presence in chrome up until maybe a quarter ago. We got qualified our PC team did a good job of getting qualified on the Google reference design.
And we started to make inroads there and.
The third area I would say is our wireless connectivity in the eye.
Coty area, so of wireless connectivity typically has a shorter designing cycle.
We said in the prepared remarks that we've actually already doubled the run rate there from our starting point, we feel like that is an area. That's just doing really really well for us.
As Dean indicated if you look at the midpoint of the guide we're at 57% gross margin.
I don't think that that that number is sustainable I think it will come back to the 55 area that where we're at for this quarter and we will use those couple of points us some pricing leverage to really start dialing up the the revenue growth.
Yeah. Thanks for that maybe just from the final segment, you talked about them in the wireless.
The wireless space.
I guess at this stage.
It feels like the.
Already reaching a run rate as of now.
To get a better understanding of how we should think about the growth of that segment from here of what will be driving that growth between Wi Fi Bluetooth any particular commentary on some of the end markets you talked about some of the design wins and I guess finally related to that are there any areas that you're focusing your investments on I guess.
The organically are whereas you're really showing you here.
<unk> tried to augment your portfolio of Inorganically.
Yeah, I think that our strength right now is in products the transfer of video.
So where we've done really well is and streaming devices and security cameras and drones anything Thats moving video.
Is where we've done very well in those segments. Obviously are growing rapidly we're coming from a very very small base.
And so we've been able to pick up outside traction that's mostly Wi Fi at some of Wi Fi, leading but for the most part of our products are Wi Fi Bluetooth combos.
We've also done well as we talked briefly about in the prepared remarks in watches we have that GPS asset with interest.
The relatively unique and so in the.
Sort of wearable market, we've also done relatively well.
Think of as we think about it going forward. We've got these roadmap products that are coming from Broadcom and I think those do open up additional segments for US. We think we can go into industrial we can go into some more low power type applications.
And we're pretty excited about that I think it's.
It opens up it strengthens our current field of use but that opens up some additional fields of use.
And we really really feel good about this business and think it can be of grower for us outsized growth for us over the the.
The next couple of years frankly.
I appreciate the color there. Thank you.
Next question from Kevin Cassidy Your line is now open.
Thanks, and congratulations on the great results.
You mentioned that your backlog is.
More than the 100% of your guidance can you talk about how the customers are reacting how far out of the placing orders in the.
C of time, when you can catch up to the backlog.
Yes. Good question, Kevin I think probably every semiconductor team has probably been asked a similar question.
Alright.
Similar to the most which is.
It's really challenge out there lead times of expanding from our suppliers. We in turn are encouraging customers to place the extended lead times on us. So the we can get the wafer starts and supply lined up for them.
And so we do have actually probably more visibility than we would normally have.
At this point in the cycle.
We we don't have an exact timeframe on when we might be able to service and fully catch up to all customers needs. It does seem like the supply constraint is likely the last all of 2021, if not a little beyond.
So it's just it's hard for all of the supply chain I think to respond in turn if you think about all of the moving pieces to put of semiconductor product together with the lead times in the Fabs and cycle time.
It's just it's really challenging to respond.
All at once.
Okay.
Okay understood.
Yeah. Congratulations on the continued momentum on your set top box designs.
Okay.
Also if you could help out with the dynamics there or are those service providers concerned about supply.
I know you.
We expect them to announce the design wins, but would they start giving you orders.
Earlier than what would be of normal cycle for set top box.
Kevin Yeah, you got it you got it right.
I would say that we are even though the a lot of these are just entering production we talked about the two Korean wins entering production now and.
Set of others for others production in the next couple of quarters, we have seen orders for all of those so people are ordering ahead.
We the there is concerned as any customer about about securing supply.
This is this is on a more advanced process nodes. So as you likely know the more advanced process nodes, there's actually less supply of tension and so that's obviously, where we are with the set top box products. There on more advanced nodes. So the the attention isn't as great there, but we still are.
Getting plenty of lead time to back up our confidence in some of these production starts.
Okay. Thank you.
Yeah.
Next question from Brad should go.
Yeah.
Yes, thanks for taking my questions and congrats as well on all the good momentum.
And Michael just wanted to go to the E.
The kind of dig a little bit further into the growth margin.
Kind of almost of the strategic shift.
That seems to be happening so.
When you're when you feel the 55% gross margin is kind of.
Of the appropriate level.
Is that a margin that you think you want to achieve in the relative of medium term and how do you balance of that versus kind of your long term target, which of which is of 57%.
Is this kind of of short term kind of medium term tactic in order to the.
The drop the price to get more.
Revenue growth and then kind of return back to 57% gross margin is kind of.
I'm kind of struggling how to how to think about kind of the drop in margin and then kind of going back up again, 57% how does that practically work, yes, that's right Rajeev I think you have it.
Short term medium term where.
Effectively we're going to choose to get a little bit more aggressive on our pricing.
You know to go after.
From revenue.
Honestly, what we're trying to do is accelerate our top line revenue potential for big slugs of revenue that we can drop to high operating income right. So the operating at the operating margin line I think is a great trade off for us.
Couple of points here in the near term.
<unk> 57 in the longer term is still our goal and we're still driving toward that as we try to step on the gas here in the near term.
I think rajeev many people accused dean of of Sandbagging at our analyst day.
From a year or so ago, we hit the long term targets like within three or four quarters. This time, we've hit two or three of our long term targets within one quarter. Okay.
We're trying to take the foot off the gas a little bit on operating margin.
And particularly on gross margin to drive topline growth and as Dean said My view is we need to get that engine going we see opportunity right in front of us where we as he said there are big slugs of revenue that we think we can we can capture.
And we're going to do that at the <unk>.
Slight expense of gross margin here to get the revenue profit really going.
And from my follow up.
If you look at the mobile business kind of following the divestiture.
It's been declining kind of on a sequential basis.
And now.
Kind of indicating to be around the $78 million range.
The kind of falling from.
133 of the peak and then kind of falling down to 78 again post the divestiture.
Yes.
How do we think about the mobile business is this an area that.
To your point about.
Kind of being more aggressive on price.
Getting into the DVD IC market is this an area that you want to try to reaccelerate.
Of the revenue growth in the mobile segment specifically.
Again, yes, I think you've got it right.
I think what we'd say right now.
We've had this conversation I'd say, we're sort of now.
At the bottom of our mobile revenue curve.
Scene.
Significant.
Erosion on one of our large north American handset customers in a touch opportunity there.
I think that we feel like that those numbers are out of our go forward guidance and so.
That we feel like that business the.
The number we just described is kind of the bottom.
And from here, we will built there are opportunities for us as you correctly characterized in D C.
We continue to feel good about our OLED touch that continues to do well in the market is weeks to continue to accumulate. These wins those numbers are going to grow and then we have that traditional LCD driver that we think is it now at steady state. So we feel good about our.
Position Rajiv and near term as you correctly said, that's the single biggest opportunity for us to start.
Getting the top line going again.
Alright I appreciate it thank you.
Again to ask the question you May press the star one on your telephone keypad.
Again, Thats star one on your telephone keypad.
Okay.
And we have a question from Harrison of Merit. Your line is open.
Hi, guys. Thanks for taking my question.
Do you have any updates on the opportunity for the coupon of products the low.
<unk>.
And to the industrial market and just the market. You think you can break into on the right or might this be an area for an acquisition.
Yes, the Harrison.
A couple of pieces to that I think we're in the early innings with with Katana, we've actually.
Just put one of our best leaders on this to sort of drive it to engage with the customer base and then figure out a road map.
And I think we've talked about in our previous call. We are partnering up with the third party of company called at of compute that's helping us with some of the software that would go into that so just started its early innings I would say the customer traction has been.
The relatively surprising.
We're probably the most sizable player now in a low power AI application, particularly one that leads with vision rather than voice.
But we're quite a ways away I think from from seeing revenue, probably a year out from turning the design traction into something material.
But I like our chances and I think it's going to lead to a full product roadmap and as I say part of our story to mitigate our expense has been to partner of bit.
Both of the software, which we've announced and then we've done some some other hardware partnerships.
Would we acquire in the space that we think it's an exciting space. It's early innings I think what we're trying to do is test it out and find out where the opportunities are.
And as we figure out this market will better chart, our forward looking course.
Great. Thanks, and then I think this was touched on in a few of the questions, but do you have any additional color.
On the opportunity in the OLED display drivers.
Is there any color around the types of customer is this.
Just opportunistic given the tight supply environment or are there any sort of some longer term roadmaps that you're engaged in.
Yeah.
Probably more of the latter than the former I think that as the market has shifted from Korean glass to Chinese glass and opportunity window has opened up for us and so we've been carefully selecting LCD.
<unk> OLED panel manufacturers that we partner with.
And we think that we bring some performance advantages to bear.
As we've characterized we see this sort of a step in our journey I think we want to enter with the Standalone <unk>.
And partner up with the Chinese glass guys, but as we think about this on a longer.
Road, we would want to really go after the TDI opportunity that we talked about several quarters back. So I think that debt. Our first our first engagement point is relatively opportunistic but gets us in there get some meaningful revenue going we lead with performance.
We do follow that with supply and some other things that we think that are obviously very important and then as we look further out it would be of more of a <unk> type of play.
Great. Thanks, Thanks Harrison.
There are no further questions.
Like can you turn it back to Mike Farrell Sterne.
Yes, sorry.
We do have one question here from Martin Young.
Sure go ahead.
Your line is now open.
Thanks for taking my question. So can you maybe talk about almost all of them.
Digging into the Iot and the Mark.
The dynamics of the there's more are you still seeing.
The supply chain of supply shortages of regarding the wireless segment and when do you see that resolving itself.
Most definitely I mean, we're certainly seeing some supply chain shortages and wireless.
Martin we've talked about.
That one being particularly challenging because it was of new business for us. So we sort of had on forecasted growth now we've successfully been able to.
Move our supply chain. So we've moved among a couple of different foundries and I think we've found the spot now where we can successfully keep.
Keep up with demand we've been able to qualify some of our old devices on new foundries and Thats opened up our supply chain a bit.
So that gives us the confidence that we can continue to keep that growth engine engine going but it certainly has been a challenge we've had to work hard to sort of re duplicate our supply chain first frame the supply chain from Broadcom to Synaptics and then maneuvering around some of the founder.
<unk> challenges by Reduplicative the die.
Hi at different places.
Thanks.
The next one.
As part of the PC business day.
Do you think that the.
The strength returning to something else in the sense that were.
There may be a broader set of opportunities also of laptops for you on the ongoing.
Going forward basis, where maybe there was a step up on the need for.
Don't docking stations for instance.
Yeah, we talked about that in the in the.
Remarks, certainly docking station there absolutely has been a step up in demand that's been driven by first work from home people brought docs.
<unk> now as people return back to the office, we think of hotels is going to be a common configuration. So the Doc has been good.
In the PC area, we think that we have additional opportunity as well in terms of.
Products that we currently don't really engage in for example, touch on the screen itself rather than the touch pad. So we think we can expand the set of products that we offer to the PC customers.
And then we're going after entirely new applications, we talk about wireless monitors wireless docking stations, we think that those will become increasingly prevalent as as time moves forward. So there's a lot of things going on in the PC space, We're obviously doing well in our core business, but we see opportunities to <unk>.
Put up new markets and actually new set.
Segments of the PC, so we can sell more content into the existing boxes.
Yeah, the other thing sorts of here.
The trend within sort of the PC laptop world.
Moving to expand the size of the touch pads and Thats an opportunity for us going forward. There's also a number of accessories PC accessories. That's also doing quite well in the marketplace. So all opportunities for us.
Got it thank you very much thank.
Thanks Barton.
I'd like to thank everyone for joining us today, we certainly look forward to speaking to you at our upcoming virtual investor conferences.
I hope everybody stays well and see you all soon.
Okay.
This concludes today's conference. Thank you everyone for participating you may now disconnect.
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