Q4 2022 SiTime Corp Earnings Call
[music].
Good afternoon, and walk them two five times fourth quarter 2022 financial results Conference call.
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As a reminder, the conference call is being recorded today Wednesday February the first 2023.
I would now like to turn the call over to Brett Perry of Shelton Group Investor Relations you may begin.
Good afternoon, and welcome to <unk> fourth quarter 2022 financial results Conference call on today's call from Si time, a rejection Fischer Chief Executive Officer, and Art Chadwick Chief Financial Officer before we begin I'd like to point out that during the course of the call.
The company May make forward looking statements regarding expected future results, including financial position strategy and plans future operations, the timing market and other areas of discussion.
It is not possible for the company's management to predict all risks nor can the company assess the impact of all factors on its business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward looking statements in light of these risks uncertainties and assumptions the fourth looking at Vince discussed during this call.
<unk> may not occur and actual results could differ materially and adversely from those anticipated or implied.
Neither the company nor any person assumes responsibility for the accuracy and completeness of the forward looking statements. The company undertakes no obligation to publicly update forward looking statements for any reason after the date of this call to conform the statements to actual results or to changes in the companys expectations.
For more detailed information on risks associated with the business. We refer you to the risk factors described in the 10-K filed on February 25, 2022, as well as the company's subsequent filings with the SEC.
Also during the course of the call will refer to certain non-GAAP financial measures, which we consider to be an important measure of company performance.
These non-GAAP financial measures are provided in addition to and not as a substitute for or superior to.
Measures of financial performance prepared in accordance with U S. GAAP the only.
Only difference between GAAP and non-GAAP results is stock based compensation expense and related payroll taxes. Please refer to the company's press release issued today for a detailed reconciliation between GAAP and non-GAAP financial results with that it's now my pleasure to turn the call over to <unk> CEO , Rob <unk>. Please go ahead.
Thank you Brad good afternoon.
First I'd like to welcome new as well as existing investors suicide Times Q4, 2022 earnings call.
<unk> is a leader in a dynamic new product category called precision timing and.
In electronics timing is ubiquitous and ensures reliable functioning of systems.
Si time created precision timing to service the needs of applications like automated driving five G enterprise and Iot.
We are early in our growth as we transform the $10 billion timing market.
<unk> shipped 3 billion precision timing chips to 20000 customers in 300 applications.
We had a solid fourth quarter.
Revenue for the quarter was $60 8 million and revenue for 'twenty, two was $283 6 million.
This is a 30% growth over the previous year, even though the second half of 2022 was challenging.
non-GAAP income was $14 4 million for the quarter and $82 9 million for the year, which is 29% of revenue.
On the product side side time introduced four new products since the last earnings call.
Previously we had introduced four key performance metrics as indicators of future revenue Sam expansion design wins.
Peace and single source business.
While we don't expect to do this on an ongoing basis given the current market conditions, we're giving further insight into our business.
By using these metrics this time.
In 2021, our Sam was $1 billion in 2022, we grew at two 2 billion. We're on track to get to $4 billion by the end of 2024.
With a highly differentiated precision timing products side.
<unk> is creating a market, where we continue to expand our advantages.
Since our last earnings call, we introduced four new products.
And are on track to introduce five more in 2023.
Customer activity for these nine new products, which includes architectural discussions and sampling continues to be robust.
Seven of these nine products are in our focus segments.
<unk> enterprise automotive and aerospace defense.
Okay.
Last week, we introduced two new and Europe product families that expand our presence in the aerospace defense market and applications, such as position navigation and timing PNT Tactical communications.
Network synchronization and surveillance.
<unk> products deliver up to 10 times better environmental resilience, which is crucial for these applications that operate in harsh environments.
Our funnel and design wins continue to grow at a higher rates than in previous quarters.
In Q4, 'twenty to our design wins grew 50% to 55% over the same period in 'twenty one.
Additionally, 65% of these design wins were in our focus segments of Comms enterprise automotive and aerospace defense.
Okay.
Higher average selling prices or asps are an indication of the value that we provide to customers. Our asps continue to grow and are expected to be higher in 'twenty. Three then in 'twenty two.
As in the past few years, we're not seeing any meaningful loss of business to competitors, even though their availability has increased and lead times have shortened.
We attribute this to the highly differentiated nature of our products.
The customer trusts. The tight time has earned is of tremendous importance to us and a metric of that as a percentage of business that are single source.
'twenty three we expect to continue to have 80% of our business is single source.
Looking further out our funnel is in a similar single source position across geographies and market segments.
Now coming to our guidance for Q1 'twenty three.
As we said earlier the shortages of the past few quarters that customers and their contract manufacturers to purchase more than they needed.
<unk> is continuously evaluating the inventory situation at our top 50 customers and there are more than 100 contract manufacturers.
While most customers inventory is as we forecasted earlier.
New development is that our historically largest customer recently informed us that they have more inventory at the subcontractors than they previously thought.
Despite the rest of the business being as expected this will lead to lower revenue in Q1 'twenty three than previously thought.
We continue to believe Q1 2023 will be the lowest quarter of the year as we expect Q2 to be higher than Q1.
And the growth to resume in the second half.
In conclusion and customer demand continues to be generally L. D. R.
Our design wins in Sam expansion continues to grow.
Our connections with customers is close and growing through design wins.
<unk> continues to be the leader in precision timing a category that we created and we are confident about our future success.
Great Thanks, Jeff and good afternoon, everyone.
Today, I'll discuss fourth quarter and full year 2022 results and I'll provide guidance for the first quarter of 2023 and make some comments on the year.
I'll focus my discussion on non-GAAP financial results and refer you to today's press release for a detailed description of our GAAP results as well as a reconciliation of GAAP to non-GAAP results.
Revenue in the fourth quarter was $68 million and revenue for the full year 2022 was a record $283 $6 million up 30% over 2021.
Sales into our mobile Iot and consumer segment were $24 7 million or 41% of total sales.
Sales to our largest customer which is included in this segment were $15 5 million or 26% of sales.
Excluding sales to our largest customer sales into this segment were $9 2 million or 15% of sales.
Yeah.
Sales into our industrial automotive and aerospace segment were $20 3 million or.
Our 33% of sales.
Sales into our communications and enterprise segment were $15 8 million or 26% of sales.
Okay.
non-GAAP gross margins were 63, 1% down about two points from Q3 due to the lower revenue.
non-GAAP gross margins for the full year were 65, 2%.
Yeah.
non-GAAP operating expenses for the quarter for $28 $2 million as we held spending essentially flat with Q3 expenses.
<unk> expenses were $16 6 million in R&D and $11 6 million in SG&A.
non-GAAP operating margins were 16, 8% for the quarter and 26, 7% for the year.
Interest income for the quarter was $4 million up substantially from prior quarters due to higher investment yields.
non-GAAP net income was $14 4 million or <unk> 64 per share.
non-GAAP net income for the year was $82 $9 million or $3 66 per share.
Accounts receivable at the end of the quarter were $41 2 million with Dsos of 61 days compared to $44 9 million and Dsos of 55 days in Q3.
Inventory at the end of the quarter was $57 $7 million up from $45 4 million at the end of Q3 as we bought additional wafer safety stock to provide a cushion in the event of any future geopolitical or other supply chain issues.
During the quarter, we generated $5 million in cash from operations invested $8 million in capital purchases and ended the quarter with $564 million in cash cash equivalents and short term investments.
Essentially flat with the prior quarter.
Okay.
I'd now like to provide some financial guidance for the first quarter of 2023.
The macro environment remains somewhat challenging and it is clearly having an impact on industry wide semiconductor demand.
It also appears that many customers and especially their subcontract manufacturers over ordered when supply bottlenecks eased last year.
This higher inventory coupled with the current demand environment.
Has led many customers to reduce order rates as they work through excess excess inventory.
And that is what we are experiencing now.
Last quarter, we offered comments on Q1 of 2023 and said that revenue would be down sequentially from Q4 for two reasons.
First we expect the usual seasonal slowdown with our largest customer.
And second we expected a lull in comms and enterprise sales as our customers in those markets work through excess inventory.
Our view on Q1 remains consistent with the comments, we made last quarter with one exception and that has to do with our largest customer.
As we just mentioned it now appears that Theyre subcontract manufacturers have enough inventory to support their needs through the first half of the year.
This means that sales to our largest customer will likely be nominal in both Q1 and Q2.
To be clear, we have not lost any sockets with this customer therefore once they work through this inventory sales should rebound to more normal levels starting in Q3.
As a result, we now expect Q1 revenue will be somewhere between 37% and $39 million.
Gross margins will be down a few points due to the lower sales and will be approximately 60% plus or minus a point.
We will hold operating expenses relatively flat with Q4, so approximately $28 million.
Interest income will increase to somewhere between five and $5 $5 million.
Diluted share count will be approximately 23 million shares.
So at the midpoint of that guidance, we therefore believe Q1 non-GAAP net income.
We'll be approximately breakeven.
We also believe that Q1 will be the low quarter for the year.
That revenue will increase in Q2.
And that once excess inventory gets worked down sales should rebound nicely in the second half of the year.
I'd like to conclude my remarks by saying that even though we're going through this short term dip.
We firmly believe that our long term growth story is intact.
Our process and product developments continue as planned.
We expect to introduce at least five more new product families. This year with each spawning numerous derivative products.
This will expand our Sam from about $1 billion, a year ago to about $4 billion by the end of 2024.
Design win and quote activity has been strong and that coupled with new product introductions and an expanding Sam should lead to continued long term growth.
And on that note I'd like to hand, the call back to the operator for Q&A. Thank you.
Thank you, ladies and gentlemen, as a reminder to ask a question you will need to press star one on your telephone.
Wait to hear your name announced.
To withdraw your question. Please press star one again.
Please standby, while we compile the Q&A roster.
Okay.
Our first question comes from the line of Quinn Bolton with Needham <unk> Company. Your line is open.
Hey, Art and reserve I guess.
I wanted to start with just the environment, obviously, it sounds like inventory correction is going to keep results fairly depressed in the first half of the year, but wondering if you might comment today, where do you think the natural level of demand or what do you think consumption of your products is running at on a quarterly basis, so that as we start.
Snapped back to that consumption, we have some some sense what the revenue ramp might look like in the second half of the year.
Yes, that's a great question.
It's difficult to quantify that precisely clearly the demand is substantially higher than the guide that we gave for Q1.
As both rejection I talked about there is there is a lot of excess inventory in the channel as I mentioned in my discussion.
Thank you.
You can go back to 2021, and there are a lot of shortages in the industry and when those shortages eased a lot of folks a lot of our customers and certainly their subcontract manufacturers.
Took advantage of the supply and over ordered so they ended up with too much inventory that has to get worked down.
So I'm not going to put a number on it but clearly that is suppressing our revenue I would say substantially certainly in Q1 and it will also do that in Q2.
If you just look at our historic numbers I mean for the year, we did $283 million in 2022, and there is some over buying in that I think clearly in the first half of the year, but if you're not that down that's kind of be a normalized number for 2022, and I think longer term or.
At 30% growth rate.
Is intact once we get through this dip so people I think can kind of triangulate what the back half should look like and definitely what 2024 should look like given that kind of growth rate. So I know I didn't give you any numbers there but.
Had some color to what we said earlier.
So maybe.
Just trying to frame it it sounds like that the $2 84 in 2022, obviously included some amount of inventory burn it sounded like it could be ballpark $20 to $40 million and so it sounds like a run rate might be closer to $42 60 is that sound about right.
I would not dispute that number I don't want to get tied down to an exact number but I think the logic there is sound.
Great and then this is sort of a quick follow up just as margins.
Historically.
It trended or followed revenue I assume that debt.
Since you think revenue is trough in the first quarter.
That the 60% guide for Q1.
Would you expect that also to be the trough for the year and that as revenue grows sequentially.
Through the rest of the year that gross margin would trend higher.
Yes, absolutely and we've talked about this before even though we are fabless, we do have a certain amount of what I call fixed manufacturing overhead as the cost of our ops group had some depreciation on some of the back any equipment that we own. This located at our <unk>. So and that's about 10 points of margin. So when the revenue is lower the absorption rate is lower.
And that's what drove lower gross margins from Q2, there was 65 and change down too.
I'm sorry in Q3.
Down to 63% in the quarter that we just announced in my guide down to 60% in Q1. So the direct answer to your question is yes gross margins will increase as revenue increases I would expect that we can exit the year with gross margins close to our historic margins again, we had gross margins just over nine non-GAAP .
Gross margins just over 65% for the full year that we just ended and I think we should be able to get back to that level.
This year 2023.
Perfect. Thank you for the additional color.
Yes.
Thank you.
Please standby for our next question.
Our next question comes from the line of Chris Caso with Credit Suisse. Your line is open.
Yes, good afternoon.
So the first question I just.
I guess based on what you provided in guidance. If you can give some color on the additional segments I mean, it seems like.
The guidance seems to imply sort of flattish revenue for both industrial or auto Aero kind of enterprise and then seasonal decline in the consumer part that's outside of your main customer or is that a reasonable expectation any kind of color you can provide around that.
Yes, I think I think that's a pretty good analysis again comms and enterprise.
Substantially lower from Q4 to Q1 for the reasons that I mentioned and that is our largest customers. That's plural in that segment have enough inventory to get them through the first quarter. So their order rates are relatively low.
For Q1, so the biggest decline would be in comms and enterprise in our auto and industrial segment in total that's going to be flattish from Q4 to Q1.
And then our Iot and consumer space, excluding our largest customer will be flattish.
But our largest customer of course, we'll be down very substantially revenue to them as I mentioned was $15 5 million in Q4, and it will be quite nominal.
<unk> means less than $1 million in Q1.
Okay. That's clear thank you.
As a follow up.
If you could speak about <unk>.
Pricing for the remainder of your products and for gesture made it clear that.
A large number.
Vast majority of products are sole sourced.
Knowing that.
Those customers are buying the product for the performance but.
As you see some of the more conventional quartz products decline in pricing.
Is there a risk that the gap between five times pricings and the more conventional pricing has widened to the point that you do see some pressure.
What are your customers, telling you and kind of what are you seeing in the market right now.
Right.
<unk>.
The way I see it is that there are some products subside times.
That.
Have no comparable product I would say that's significant in comms and enterprise in a significant part of auto and clearly in the military aerospace business. That's also true in some of our other products, but let's just focus on this one and this we see no competition we see.
No quest for lower pricing.
Because our customers clearly understand how unique our products are in providing value.
On the products that are pin for pin compatible.
Higher volume typically in industrial.
Perhaps in consumer.
Maybe in some some lower end of networking telecommunications, even their recall, Chris that we still sell at a premium price.
That means that even in those markets, we sell into higher end of that customer's product, which also means that we don't see any pricing pressure and to the extent we.
We do.
We have been able to adjust for it.
In a particular way that it doesn't impact us and continues to lead to growth in our blended pricing, including our largest customer.
For the last several quarters, so I'm very confident that <unk> is at a good position, primarily because of our highly differentiated products, whether they are in our focus markets or in our not focused markets.
Got it thank you.
Yep. Thank.
Thank you please.
Please standby for our next question.
Our next question comes from the line of Alexander of Becky with William Blair. Your line is open.
Hi, Thanks for taking my question.
Some additional color on on your largest customer.
Should we be thinking about to take that much revenue out for the next two quarters. It really looks like they have been building inventory over.
The last year, plus should we be thinking about like normalized rate for that customer more in the kind of 2019 2020 timeframe or do you think they can get back to 2021 levels at some point in the future.
Yes, I think they can get back to 2021 levels clearly.
Clearly, they overbought or more precisely their subcontractors over bought but we.
Haven't lost any sockets there.
And they're a great customer of ours, we work very closely with them.
So yes, I think we can get back to those types of numbers I think Alex there's been some decline in their natural demand.
It's probably in the in the news as well.
But in generally in general it has to have a very complex.
More than anybody else they have a whole host of CMS.
And I think that between the CMS in them.
They it took a while for them to figure it out but.
<unk>.
But they did.
<unk>.
We look forward to any changed forecasting methods from them.
And we have had some discussions on that.
Perfect. That's helpful. I was just trying to think about a more normalized level and then not to harp on the consumer segment in general but yes.
We've had conversations talking about the non <unk>.
Apple consumer portion.
Being allowed to sort of bleed out.
Over time.
Customers may be go back to court, but didn't.
Fourth quarter, it looks like revenue sort of increased sequentially and I believe you said it would be flattish in Q1 can you can you add some color on what youre seeing from customers in terms of.
Their appetite to go back to court versus stay with you and how we should think about that over the next year or two.
Yes in general as I said earlier.
We see that wherever they have been our customers have differentiated products. They tend to use some time and so we have found very little if any almost de minimis loss of.
Of business as a consequence of the.
The increased availability of course crystal.
So we think that ex our largest customer as well.
That our business with consumer continues quite solidly.
And in fact, we continue to get some nice design wins.
<unk>.
That will help us in the second half of the year I believe.
And Alex I would just add another comment to that we have talked about that segment.
Declining over time.
But not going to zero there are still as <unk> mentioned customers.
In the consumer space, where we provide real value so.
Not expecting those numbers to go to zero and as I mentioned in my script. It was $9 $2 million in the fourth quarter that was up $1 million, maybe a $1 million in half from Q3.
I mean, that's I think a reasonable run rate for us there and over time, if we have the right customers that could even go up.
Great.
Very helpful. Thank you.
Thank you.
Please standby for our next question.
Our next question comes from the line of <unk> de Silva with Ross Your line is open.
Hi, Josh Hi, Art I appreciate it.
Gross margin guidance towards the end of the year and the confidence there I wanted to understand if that I imagine implies steady pricing assumption or if theres improved blended pricing and that assumption to going back to mid sixties from end market or product mix uplift.
Well I mean, one of our basic themes and one of the ways that we got our gross margins to expand from the high <unk> three years ago. When we went public to 65% for the full year that we just finished is that most of our new products are focused on the market segments that <unk> mentioned, which are generally.
Higher performance markets, we get higher Asps and higher gross margins so over time as those new products.
Become a larger percentage of our sales that will continue to help expand our gross margins and I think we'll see some of that certainly in the back half of this year and going out for a number of years.
That's right and the confidence I think the some of the metrics that we gave so G are all related our Asps solidity.
Solidity and growth is related to a single source, it's related to our new products.
And it's related to our Sam expansion Theyre, all four tied together, which is why it's all part of one strategy deliver highly differentiated products that customer just got to have.
And I think.
Of course, we see the benefit of that in the relatively short term in the coming quarters, but the real benefit benefit for that is going to come in growth and stickiness.
In 2024, and 2025 and so on so I think as those products, we talked about nine products as they unfold in.
In the marketplace as we get as we get the design wins.
I think it'll be really good.
Yeah.
Okay, Great and then my follow up question is those new products as they're coming in.
And winning I presume, they're more focused on the non consumer markets auto infrastructure data center, what's the design cycle, there and for those programs to ramp and is there sort of an elbow point. When these new products were announced some of them late in 'twenty two that we start to see them come in through design win ramps.
Yes.
The typical thing would be to say that in the comms enterprise automotive aerospace defense, our rule of thumb would be about 18 months to ramp to revenue that being said, we actually see some times.
Enough of a desire for our products that they get rushed to market quicker than we.
Ever thought also don't forget that while seven out of nine of these products are in fact men for these focused segments. The remaining two are in fact, four for consumer Iot and mobile and those balance it out by a shorter design win let's say less.
And a year and shorter time to time to revenue less than a year and so.
You know.
To get to its full glory I think it takes maybe three years for a product and then in the focus areas.
But again, a reminder, that none of our products have ever been obsolete. It from the time, we introduce them 12 years ago 13 years ago. So they still continue to sell so that's an important way of understanding the value.
Very helpful. Josh Thanks, guys.
And again these new products. This looks forward, but we also introduced a lot of products last year and in 2021 and going back to 2020, so even though some of these design cycles can be one two or three years.
We have a number of products that are in the middle of those design cycles.
Okay, Great sounds good thanks, guys.
Thank you.
As a reminder, ladies and gentlemen that star one to ask the question.
Please standby for our next question.
Yeah.
Our next question comes from the line of Toric benchmark with Stifel. Your line is open.
Yes. Thank you Rajiv Thank you Ed.
I had a question about your largest customer.
Especially as far as then moving manufacturing around I mean, I think this is sort of in the public domain two and I'm just wondering if some of this inventory build and subsequent reduction.
Has anything to the diversification of the manufacturing base or where do you think this is just more purely their contract manufacturers building tumor supply when supply was short.
Yes, it's a tricky question to ask and there are some things we don't want to talk about too much.
But I think they do have more CMS than anybody else that's 0.1.
Second point is that.
We understand that in tough times.
All CMS many CMS overall for a variety of reasons, some good ones and some not so good ones.
In the case of our largest historically largest customer we have spent a lot of time in the past years.
Looking at forecast directly from them and comparing it to forecast from the CMS.
You can almost say that in some ways we were somewhat instrumental.
In.
Helping all parties understand what the real situation was.
So <unk> has been a value added player in all of this.
Yes, that's great perspective, and as my follow up.
Your inventories.
So again, you know given that you are.
Sales to your largest customer is going to be basically nominal next two quarters.
Can you just give us some confidence in that $58 million of inventory you mentioned most of it should be in wafer or in raw materials. So again just.
Wondering how we should think about that 58 million given the.
A big drop at least in the first half of the year, yes. So first of all we consciously increased our inventory as you mentioned $57 7 million at the end of last quarter.
And the increase is all in wafer stock so as we've talked about many times, we get our Mems wafers for Bosch, It's our process with their factory and we get our Cmos waivers from TSMC.
And we bought wafers from both boss and TSMC and we did it.
To provide a buffer stock if theres any type of geopolitical issues out there. If there is any type of supply chain issues out there we have wafer stock that can support a number of quarters worth of sales and remember wafers do not go bad they do not go obsolete. These can sit on the shelf for years and years and years if needed.
They are not going to sit on the shelf for that long, we will start to work it down over the next couple of quarters. So you would expect it to come down during the course of the year to a certain extent, but wafers do not go bad and that gives us a lot of comfort and quite honestly. This gives our customers a lot of comfort.
For the reasons that I just mentioned if there are any type of supply chain issues out there with so many of our customers being single sourced with us. They can hide a forward for us to not be able to ship something to them right. So yeah wanted to underlying some more on what art said I am very comfortable with our inventory and we have done this.
We're deliberately for two or three reasons. One reason is as you as we pointed out none of our products have been obsolete. It in the history of the company and wafers quote Unquote don't go bad Thats. One the second is 80% of our business single source and as we head into the palms enterprise automotive and aerospace defense markets.
It's important for us to reassure our customers that they are in safe pair of hands. The third is.
Less defensive and more opportunistic or offensive.
Nobody knows whether the back half of this year is.
A big.
<unk>.
The curve right, we definitely expect it to be more than first half, but there is a case to be made for it to be made for that to be a big snap back to be a real snapback in demand in the second half I'm, not saying that it will be I'm, just speculating that if it is I think it gives <unk>.
<unk>, a great position to be able to capitalize on that with our programmability.
With our value proposition and we think that that it makes sense for that reason as well.
Very helpful. Thank you so much.
Thanks Terry.
Thank you.
Please standby for our next question.
Question.
Our next question comes from the line of Doug <unk> with fabricate acknowledge your line is open.
Hey, Art Hamer Josh.
I was just wondering for the full 2023 will you be shipping below the run rate demand I mean, we just don't know what the second half looks right now I was wondering.
Yes.
If theres a possibility that the entire the entirety of the year youll be moving down inventory.
All up.
Yes, so we will clearly be shipping below end demand right because our customers have to work through some of their inventory. So whatever we end up shipping the end demand will have been higher so I don't know if thats your question or if it has to do with our inventory okay.
So I was more just trying to get the trajectory of the second half like there really is no way to know right now, but like for example at some point in Q3 Q4 is your largest customer goes from essentially zero to someone else.
I'm, just trying to get a better shape.
Essentially trying to ask what Q3 and Q4 could look like on the other side, but I understand that's pretty hard to others.
Forecast so.
Yes.
Let me provide some comment on that yes, we believe that sales to our largest customer will come back strongly in the back half for two reasons one in the first half they're going to have to consume inventory that disappear that situation disappears in the back half and the second piece of this is that our strongest business with this customer is always traditionally been in.
The second half of the year. If you go back and look at preceding years that as we shipped a lot more to them in the back half of the year than the first half of the year. So I firmly believe that our sales to that customer will come back relatively strongly in the back half of the year.
Okay, perfect and then on the design win side, you talked about 300 applications in the prepared remarks is is there some kind of do you guys track the application expansion and is there a way to see how much that's expanded overstay, 'twenty, one or 'twenty or 2020.
We don't track it as a primary metric it's one of the secondary metrics what we what we track are our design wins in particular segments rather than in particular applications, but I think it's safe to say that from the time that we went public we are gone.
We've about doubled the number of applications. So in other words, we've probably gone from sub 150 to 300 applications.
And we continue to add applications.
Every month really.
Okay, and then going forward with these design wins do you think youll be able to double that again like I'm, just trying to get a kind of magnitude of the number of design wins like from the longer tail or is it going to be like a similar group of current applications that are just being sold into more and more if that makes sense right.
Our funnel is very strong right. Our funnel continues to grow very very solidly year on year every year that we've been here, it's been growing a lot and thats not a surprise given that we've been adding new products.
And we have been marketing stronger and so on so as long as our funnel growth continues, particularly around single source, particularly around our focus markets, particularly around our higher differentiated products I think that the design wins will follow.
Quite naturally, but we think that they will grow but I couldnt say, whether the double.
And I Couldnt give you that level of precision.
So Doug another way to think about it as we talk about our Sam a lot and we calculate that Sam by looking at the different applications and how our products will apply to those different applications.
Sam was $1 billion a year ago.
Just recently as <unk> mentioned on the call. We think it's about 2 billion now and by the end of 2024, we think it goes to $4 billion and a lot of that Sam expansion comes from new products that are essentially going into new applications.
Okay perfect. Thanks, guys.
Thank you.
I'm showing no further questions in the queue I would now like to turn the call back over to management for closing remarks.
Yes, I'd like to just say that I feel very comfortable.
The decline in our largest customers revenue is not to our liking, but we understand the situation very well.
Because as I said, we helped get some clarification in it so we have.
Good insight into that.
We are also on the second half of the year as mentioned by art quite confident in the growth of their business ex that business. The rest of our business continues to do well. We continue to believe that Q1 is in fact the bottom.
And that we start to get back in Q2.
Q3 Q4.
It starts to ramp up what the level of that ramp is.
We are watching carefully we obviously have strong views on that but we're just watching for now and we'll let you know as it unfolds clearly, though what makes me feel.
Very good about the place where we are is that in all of this our asp's.
Continuing to grow.
Our single source position continues to be at 80% our funnel continues to grow.
Our.
Our products are right on time and given the even in spite of the complexity, we are able to bring them out and connect with our customers. So all in all I think we're in a great shape and we.
Love to give you more information as we go further in the quarter.
Thank you very much great. Thank you everybody.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.
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