Q1 2024 Power Integrations Inc Earnings Call
Thank you for standing by my name is Mike and I will be.
Mike: Conference operator today at this time I would like to welcome everyone to the power integrations Q1 earnings call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.
Mike: I'd like to ask a question. During this time simply press star followed by the number one on your telephone.
Mike: If you would like to withdraw your question Press Star One again I would now like to turn the call over to Joe Shiffler Director of Investor Relations. Please go ahead.
Joe Shiffler: Thank you Meg good afternoon, and thanks, everyone for joining us.
Joe Shiffler: With me on the call today are bothered by the Krishnan, Chairman and CEO of power integrations, and Sandeep Nayyar, our Chief Financial Officer.
Joe Shiffler: During this call we will refer to financial measures not calculated according to GAAP non-GAAP measures.
Sandeep Nayyar: Stock based compensation expenses amortization of acquisition related intangible assets and the tax effects of these items.
Sandeep Nayyar: A reconciliation of non-GAAP measures to our GAAP results is included in today's press release.
Joe Shiffler: Our discussion today, including the Q&A session will include forward looking statements denoted by words like will would believe should expect outlook forecast anticipate and similar expressions that look toward future events or performance.
Joe Shiffler: Such statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected or implied.
Joe Shiffler: Risks are discussed in today's press release and in our most recent Form 10-K filed with the SEC on February 12 2024.
Speaker Change: This call is the property of power integrations and any recording a rebroadcast is expressly prohibited without the written consent of power integrations now I will turn it over to <unk>.
Jill: Jill and good afternoon.
Speaker Change: Our first quarter results were on target with revenues up $92 million non-GAAP gross margin of 53% and non-GAAP earnings of <unk> 18 per share.
Speaker Change: Internal inventories fell by more than a week and a half during the quarter and the improvement in bookings that began in December has continued through the first quarter and the month of April.
Speaker Change: We expect revenues in the second quarter to be in the range of <unk>.
Speaker Change: And $5 million, plus or minus $5 million.
Speaker Change: That would be a seasonal increase of 15% at the midpoint.
Speaker Change: We also expect a further increase in gross margin driven by the favorable dollar yen exchange rate and Hyatt backend manufacturing volumes.
Speaker Change: Most importantly design momentum has remained strong, especially in key strategic markets like high power motor drive and automotive.
Speaker Change: Victor trends like energy efficiency clean energy and electrification are expanding the opportunity for our products.
Speaker Change: We also continue to advance along our product and technology Roadmaps with two key developments in recent weeks, starting with the introduction of much too.
Speaker Change: You know what Stu is emblematic of our staff our system level approach.
Speaker Change: The high level of power conversion high voltage power conversion.
Speaker Change: Combining leading edge switch technology novel control schemes and proprietary packaging that is not only cost effective and thermally efficient, but also implements isolation and feedback through our flex link technology.
Speaker Change: Most products with embedded AC to DC power supplies.
Joe Shiffler: I have multiple DC output voltages, but.
Joe Shiffler: <unk> parts of the system.
Joe Shiffler: For example, if that's what today it might be acquired 15 watts for the electronics controlling the compressor motor Twentyfold awards for the interior lighting and Sidewalls for the user facing control panel.
Joe Shiffler: In a typical architecture the power supply provides a single DC output, which is then converted into each of the different downstream voltages by low voltage DC to DC converters.
Joe Shiffler: Energy losses at each conversion stage of compounded.
Joe Shiffler: Significantly reducing the overall system efficiency.
Speaker Change: You know I'm not still offers a single.
Speaker Change: A new architecture, eliminating the need for downstream DC to DC stages by providing up to three independently regulated BC outputs.
Joe Shiffler: This dramatically reduces component count and complexity.
Joe Shiffler: And also enhances efficiency by eliminating the compounding of losses across multiple stages.
Joe Shiffler: The Cherry on the top is that you know them extra features our highly efficient probably again switch, enabling overall system efficiency of better than 90%.
Joe Shiffler: Contrast, this with a traditional architecture, which is an AC to DC stage, followed by a separate DC to DC stage.
Joe Shiffler: Even if both stages are 90% efficient the compounded losses resulted in a total system efficiency of only 81%.
Joe Shiffler: In other words.
Joe Shiffler: <unk> losses have been reduced by nearly half.
Joe Shiffler: Because most products with embedded power supplies required multiple D C voltages.
Joe Shiffler: The addressable market opportunity for <unk> is large and diverse.
Joe Shiffler: We already have a pipeline of design activity across a wide range of applications.
Joe Shiffler: Including displays appliances networking equipment and more.
Joe Shiffler: Our first production design and desktop monitor at the top tier PC OEM is expected to begin ramping in Q3.
Joe Shiffler: The other notable development on our road map is our agreement to acquire the assets of Odyssey semiconductor as announced earlier today.
Joe Shiffler: Odyssey is the developer of vertical Gan technology, which adds higher current capability than lateral Gan devices, and therefore has the potential to address much higher power levels.
Joe Shiffler: Hi, Karl again has been on our development roadmap for some time and we are bringing the Odyssey team on board to augment those effects.
Joe Shiffler: Our integrations has led the way in development of Gan technology for power conversion, starting with our 750, well again in 2018, and we are advancing our technology along multiple fronts.
Joe Shiffler: One is cost as we continue to dry up again towards the cost parity with silicon MOSFET.
Joe Shiffler: I know there is voltage with continued with introductions of 900 volt and $12 50, well Gan technology last year and have even higher voltage technology coming soon.
Joe Shiffler: These higher voltages expand the opportunity for organic power supplies, and we are designing system level products for applications such as data centers.
Joe Shiffler: I'll make it meant an 800 volt evs.
Joe Shiffler: The third vector of Gan development is current.
Joe Shiffler: Today's lateral again is the optimal switch technology, but up to about 10 kilowatts.
Joe Shiffler: But does not support high enough current or deliver more power.
Joe Shiffler: Hi, current technology is the next frontier in game development and will enable <unk> to deliver hundreds of kilowatts of power.
Joe Shiffler: This will dramatically expand the competitive overlap between Gan on silicon carbide.
Joe Shiffler: Make gan a compelling alternative for applications like EV drivetrain inverters.
Joe Shiffler: While there are a number of significant technical challenges to solve before high current Gan becomes a market ready technology. We are pleased with the progress we have made to date and we are doubling down with the addition of Odyssey team.
Joe Shiffler: With that I'll turn it over to Sandeep for a review of the financials.
Sandeep Nayyar: Thanks, <unk> and good afternoon as usual I'll focus my remarks on the non-GAAP results, which are reconciled to GAAP in our press release.
Sandeep Nayyar: First quarter revenues were $92 million slightly higher than the midpoint of our guidance. While non-GAAP earnings were <unk> 18 per diluted share above the level of implied in our guidance as we came in better on both gross margin and operating expenses.
Sandeep Nayyar: On a sequential basis revenue was up 2% with three of the four end market categories up versus the prior quarter.
Sandeep Nayyar: Consumer revenues increased more than 40% partner.
Joe Shiffler: Partly reflecting seasonality and air conditioning, but more importantly, a much improved inventory picture, our distributors and end customers and the appliance market.
Joe Shiffler: Channel inventory associated with the consumer market was slightly below normal entering the quarter and fell even further as the quarter progressed.
Joe Shiffler: The computer category was up more than 30% sequentially on new design ramps in notebooks and an uptick in tablets as a key end customer has largely worked through its excess inventory.
Joe Shiffler: The industrial category was up mid single digits sequentially as seasonal softness in high power was offset by strength in metering application and improvement in broad based industrial.
Joe Shiffler: The communication category was down more than 50% sequentially.
Joe Shiffler: The decline was partially driven by market dynamics, including share gains by while we had the expense of our customers and some of the incremental share gain at Chinese Oems during the pandemic shortages now reverting back to domestic suppliers. However, the decrease also reflects seasonality and continue.
Joe Shiffler: Inventory work Downs and.
Joe Shiffler: And we do expect a healthy recovery over the balance of the year as these transitory factors should be largely behind us.
Joe Shiffler: Revenue mix for the quarter was 41% consumer, 37% industrial 11% communication and 11% computer.
Joe Shiffler: Distribution inventory ended the court at eight eight weeks down more than a week and a half from the prior quarter as sell through exceeded sell in by about $10 million.
Joe Shiffler: Yes.
Joe Shiffler: non-GAAP gross margin for the first quarter.
Joe Shiffler: Was 53% up 30 basis points from the prior quarter as a more favorable end market mix was largely offset by the effects of lower manufacturing volumes.
Joe Shiffler: I expect a further sequential improvement in Q2, as we convert more wafers to finished goods and we recognize a further benefit from the favorable dollar yen exchange rate, which affects the cost of wafers from our Japanese foundry partners.
Joe Shiffler: non-GAAP operating expenses for the quarter were $41 $2 million up sequentially as expected due mainly to seasonal factors such as the resumption of resumption of FICA taxes.
Joe Shiffler: Other income of $3 $5 million was up slightly from the prior quarter, reflecting higher returns on our investment portfolio.
Joe Shiffler: non-GAAP earnings for the fourth quarter was <unk> 18 per diluted share.
Joe Shiffler: Diluted share count for the quarter was $57 1 million down about 100000 from the prior quarter driven by share repurchases.
Joe Shiffler: We used $15 million for repurchases during the quarter buying back 207000 shares.
Joe Shiffler: $11 million remained on our repurchase authorization as of March 31.
Joe Shiffler: The other primary uses of cash in the quarter was $11 million for dividends with an additional $4 million for capex.
Joe Shiffler: Cash flow from operations for the quarter was $16 million.
Joe Shiffler: Inventory days were 349 at quarter end up five days from the prior quarter.
Joe Shiffler: We expect inventory days to begin declining in Q2, driven by the anticipated upturn in revenues.
Joe Shiffler: Turning to Q2 outlook, we expect revenues to be $105 million, plus or minus $5 million.
Joe Shiffler: <unk> increase of 15% at the midpoint.
Joe Shiffler: non-GAAP gross margin should be between 53, 554% up 50 to 100 basis points sequentially.
Joe Shiffler: The puts and takes here will be the positive impacts from the favorable yen exchange rate and higher manufacturing utilization.
Joe Shiffler: Offset by a less favorable mix as we anticipate a sequential rebound in the communication category.
Joe Shiffler: I expect full year non-GAAP gross margin to be approximately 54%.
Joe Shiffler: non-GAAP operating expenses should be between 44, and a half and $45 million driven.
Joe Shiffler: Driven by head count growth as well as annual Merit increases, which took effect early in the quarter.
Joe Shiffler: For the full year, I expect non-GAAP opex to be up roughly 7% versus the prior year, including the impact of Odyssey, which adds about 1 million and a half.
Joe Shiffler: Millions of dollars of expenses in the second half of the year.
Speaker Change: Now operator, let's begin the Q&A.
Speaker Change: Thank you we will now begin the question and answer session.
Speaker Change: I would like to ask a question. Please press star one on your telephone keypad to raise your hand and joined the queue. If you would like to withdraw your question simply press Star one again.
Speaker Change: We are called upon to answer your question and our listening via loud speaker on your device. Please pickup your handset and ensuring that your phone is not on mute when asking your question.
Speaker Change: Your first question comes from the line of Christopher Rolland from Susquehanna International Group. Please go ahead.
Christopher Adam Jackson Rolland: Hey, guys congrats on the results.
Speaker Change: And.
Christopher Adam Jackson Rolland: Just a quick clarification Sandeep did you say 54.
Christopher Adam Jackson Rolland: For next quarter and then.
Speaker Change: <unk> sandeep either.
Speaker Change: If you could talk about order trends in Q1 month of March month of April.
Speaker Change: What end markets were affected.
Speaker Change: Or rebounded the most and then.
Speaker Change: And then how that should play into.
Speaker Change: The outlook for next quarter by end market. Thanks.
Speaker Change: What I've said is for the gross margin. It was 53 and a half to 54 for Q2 and I also said for the whole year I expect it to be around 54% all non box okay.
Speaker Change: Okay.
Speaker Change: In terms of bookings as I mentioned.
Speaker Change: December was a strong month and that strength continued throughout Q1, except of course look at.
Speaker Change: Dip in February because of the.
Speaker Change: Lunar new year, which as I expected and then the strength continued through April.
Speaker Change: So thats very good news and in Q1, our book to Bill was more than one for the first time in one in one year.
Speaker Change: So that's again a very good sign in terms of where we saw the strength.
Speaker Change: I would say the biggest is.
Speaker Change: Consumer.
Speaker Change: And then also a portion of the industrial also came back.
Speaker Change: The the cell phones was weak that communications is weak.
Speaker Change: Mainly because there is still inventory correction going on.
Speaker Change: And also Q1 is a seasonally low quarter for us.
Speaker Change: We do expect.
Speaker Change: The consumer to sort of communications to come back strongly in Q2.
Speaker Change: Now that the inventory issue is gone away and Q2 is also a stronger seasonally stronger quarter for cell phones.
Speaker Change: That is great color. Thank you very much for that.
Speaker Change: And then I guess.
Speaker Change: I need to know more about this odyssey.
Speaker Change: How big do you think this market could be how much are you investing here.
Speaker Change: Uh huh.
Speaker Change: Or are there synergies how are you looking at it.
Speaker Change: And then just a quick one for Sandeep do you still think you lead the market by one quarter in terms of the cyclical recovery just curious thanks.
Speaker Change: Okay. Let me answer the Odyssey question as we have mentioned before.
Speaker Change: We have been working on higher current Gan technology, because the current technology.
Speaker Change: It goes up to about 10 kilowatts, or so beyond that you really need to change the technology significantly to be able to handle much higher current levels.
Speaker Change: In terms of voltage we have always said, we have already been able to achieve up to $12 50 volts and we expect to go even higher with the current technology.
Speaker Change: The reason we acquired the assets of Odyssey is that the Odyssey.
Speaker Change: People have been working at the vertical Gan technology to achieve very high current levels and very high powered levels as a result of that.
Speaker Change: And we believe with this.
Speaker Change: Acquisition of assets, we have multiple benefits one is it comes with a clean room facility.
Speaker Change: Sure.
Speaker Change: Working on the new technology.
Speaker Change: That you can call it a small fab audits that we wanted to call it flat.
Speaker Change: Fab slash slab lap number two.
Speaker Change: Uh huh.
Speaker Change: Taking on all of the key employees, who will have a lot of knowledge.
Speaker Change: In the high current Gan technology.
Speaker Change: Just to be clear.
Speaker Change: The technology, we are working on is our own technology.
Speaker Change: It is different from what Odyssey and many others have been working on in terms of vertical gas.
Speaker Change: Our technology, we believe we will be very cost effective that's the most important thing assess the cost effective number one.
Speaker Change: And.
Speaker Change: We still have a lot of work to do but our goal is to get Gan to much higher power levels like hundreds of kilowatts.
Speaker Change: We can be a very compelling alternative to silicon carbide silicon carbide is fundamentally more expenses, whereas Gan. There is no fundamental reason why it can't be very much less expensive than silicon carbide. So thats. The reason, we are pushing that power levels.
Speaker Change: And this acquisition of <unk>.
Speaker Change: CSS will speed up that process.
Speaker Change: Yes.
Speaker Change: Robert.
Speaker Change: Other question, Yeah, we typically do see earlier than others, because our product goes into bar supply, but having said that I think the way to look at it as we've been talking about.
Speaker Change: We would still keep seeing growth in our revenue sequentially, even though visibility is lower for the second half Barclays fills a need that we will grow sequentially each quarter through the year.
Speaker Change: You are seeing that are really come back and appliances, which you saw a nice big growth.
Speaker Change: Our industrial segment, we are expecting for that to come back more in the third and fourth quarter, and even communication which are pretty.
Speaker Change: Pretty low quarter should start coming back in the following quarter and we are doing very well in the computer segment with the design wins.
Speaker Change: Excellent. Thank you so much.
Speaker Change: Matt could we have our next question please.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: Thanks.
Matt: Alright folks sorry, we're trying to get to reestablish contact with our operator here bear with us for one minute longer.
Matt: Yes.
Matt: Yes.
Speaker Change: Sorry. Your next question comes from the line of David Williams with the bench company.
David Neil Williams: Please go ahead.
David Neil Williams: Okay.
David Neil Williams: Taking the question first Scott just congrats on the improving backdrop here.
David Neil Williams: And the Odyssey semi acquisition.
David Neil Williams: Thank you.
David Neil Williams: And.
David Neil Williams: I guess kind of think about what Odyssey brings clearly.
David Neil Williams: Different type of different process than what you all are working on can you talk maybe a little bit about how you think.
David Neil Williams: This will integrate just kind of given the differences between the vertical Gan that theyre working on relative to your your process just trying to understand how youre going to incorporate that in as the two different roadmaps and progress points or do those come together over time.
Speaker Change: Thanks, David.
David Neil Williams: So the best way I can explain it is that there are a number of companies working on vertical Gan technology that they've been working on it for some time now there's another company called Nextgen, We've just closed down.
David Neil Williams:
Speaker Change: There are a lot of challenges with the type of technology that they were working on.
Speaker Change: We think we have a very different way to achieve the same result.
Speaker Change: And where we can get.
Speaker Change: The help from Odyssey is their knowledge of Gan.
Speaker Change: Michael Gan devices.
Speaker Change: They have number of patterns that will cut that as part of the assets we are purchasing.
Speaker Change: A clean room, which is also very useful for us too.
Speaker Change: To try our new technologies.
Speaker Change: Those are the reasons.
Speaker Change: It didn't do that it would we could've done it on our own but they are taking more time.
Speaker Change: And this really helps us.
Speaker Change: Reduce.
Speaker Change: The time to market of this technology.
Speaker Change: Some of it in the one to two year range.
Speaker Change: So it speeds up our process because of the knowledge they bring because of the patents because of the.
Speaker Change: Clean room.
Speaker Change: Okay. All right. Thanks I appreciate the color that's very helpful.
Speaker Change: And then we didn't talk much about automotive this quarter like you have in the past just wondering if you could give us an update there how those design wins are tracking and maybe if there's any been any positive.
Speaker Change: Or developments during the quarter. Thank you.
Speaker Change: A good question.
Speaker Change: The only reason we didn't talk about it as we have talked about it in the past and we have a lot of other things to talk about today, but really automotive is doing exceedingly well.
Speaker Change: We already have it doesn't.
Speaker Change: Cause in production today.
Speaker Change: We'll have another dozen introduced this year and another as of next year.
Speaker Change: And we really expect this to grow nicely. The inflection point is probably couple of years away before we see a strong growth in terms of dollar revenue.
Speaker Change: And our expectation is by 2028 this could be something in the order of $100 million in revenue.
Speaker Change: So it's doing really well overall.
Speaker Change: The product is an incredibly compelling to.
Speaker Change: To customers.
Speaker Change: The one example, I can give you is.
Speaker Change: Yeah.
Speaker Change: A Japanese tier one customer who just recently qualified us daily.
Speaker Change: They did the audit of our assistance.
Speaker Change: Systems quality management systems.
Speaker Change: And they have qualified.
Speaker Change: We passed the audit with flying colors.
Speaker Change: So that shows that we can address the Japanese market, which is one of the hottest markets to address in terms of automotive.
Speaker Change: So thats also a great sign for us.
Speaker Change: Yeah.
Speaker Change: Thanks.
Speaker Change: Each with TD colleagues. Please go ahead.
Speaker Change: Thank you very much good afternoon guys.
Speaker Change: I loved the dramatic pauses I had a question.
Speaker Change: Set it up.
Speaker Change: Yeah.
Speaker Change: But one of the questions I had.
Speaker Change: If you don't mind going into a little bit more detail on the <unk> product.
Speaker Change: And specifically.
Speaker Change: What end markets you think are the most attractive there it seems like an architecture that might be.
Speaker Change: Suited for the data center market and I Wonder if you.
Speaker Change: <unk> gotten a toehold there or how those conversations are going if in fact, they're happening in the data center power space.
Speaker Change: Thanks, Matt.
Speaker Change: The.
Speaker Change: The first product, we introduced which is the <unk>.
Speaker Change: One I guess.
Speaker Change: It was really directed towards displace displaces the really the only market. It was designed to address.
Speaker Change: <unk> two is much broader it can address.
Speaker Change: Any embedded power supplies that has more than one output requirement at the system level.
Speaker Change: So that includes appliances that includes industrial applications.
Speaker Change: That includes.
Speaker Change: Servers as you said data center servers server power supplies typically inside a server you need multiple output voltage designate 12 wells for the fans and they need firewalls and three three roles.
Speaker Change: Perfect match for that as an auxiliary power supply.
Speaker Change: So in terms of design wins, what we are seeing is that a lot of activity across all of those markets.
Speaker Change: First design win that we received is a.
Speaker Change: A major OEM.
Speaker Change: That.
Speaker Change: <unk> has a display.
Speaker Change: Requirement efficiency of equipment that we can very easily meet with <unk> and that will go into production next quarter.
Speaker Change: That particular customers already using in our MX, one, but it still will be a much broader application across a broader number of models. So we are looking forward to that.
Speaker Change: But we're also working with the Tvs.
Speaker Change: Good match for Tvs.
Speaker Change: Then appliances, we have a number of designs going on in appliances and several industrial applications will also use that as far as data centers go. We are just beginning to sample customers and we'll keep you updated on that this is for the what they call the standby and auxiliary power supply is in the 50.
Speaker Change: 70 <unk> range.
Speaker Change: And that will require multiple outputs.
Speaker Change: <unk>.
Speaker Change: I think the question you had is on the main power supply now that is evolving as we speak for artificial intelligence they need to dramatically improve the power level.
Speaker Change: Now most of the solar power supplies are in that two and a half to three kilowatt range.
Speaker Change: But now for AI.
Speaker Change: Racks, they need a five kilowatt power supply in the same form factor, which makes it really challenging.
Speaker Change: Especially without wideband gap solutions. So there I think our Gan will play an important role, but that's still being defined as we speak.
Speaker Change: He will work with multiple customers Oems and Oems to understand the requirements and we are working as you know on products for that and that those products are not quite ready yet that.
Speaker Change: That'll take.
Speaker Change: A couple of years, but in the Meanwhile, we can.
Speaker Change: Get into the oxalate power supply, which also has to be extremely efficient so our gan technology.
Speaker Change: With our zero voltage switching capability will be very attractive for that.
Speaker Change: Application with the <unk> device.
Speaker Change: Scott. Thank you by the way I appreciate all the color that was really helpful.
Speaker Change: I guess that's my.
Speaker Change: Next question Sandeep, a couple of things one.
Sandeep Nayyar: You talked a little bit about in your script, how you are seeing channel inventory levels and order patterns.
Speaker Change: I Wonder if you might comment a bit about.
Speaker Change: Customer level inventories that to the extent that you have visibility how does that visibility improve any as you've worked through these challenges some of the challenges in the channel with with the customer base and I guess the second question totally unrelated on gross margin you said 54 for the year I guess, if you could help with the puts and takes there.
Speaker Change: And what kind of assumptions you have on the yen that 54 number that would be helpful. Thanks guys.
Speaker Change: Yes, I think definitely especially in the consumer segment you have you seen the not only the channel, but even customer inventory as you remember in the past we talked about our major customers in Korea.
Speaker Change: We hadn't taken for a long time, and we are starting to see orders there. So clearly youre seeing a movement in the channel inventory and consumer is well below our what I call a normal average.
Speaker Change: But industrial is still a bit higher so that we know will work out but I think definitely if you really look at it it's playing out as we expected as.
Speaker Change: As far as the gross margin.
Speaker Change: The yen is going to be.
Speaker Change: Favorable volume increase for the backend utilization is better as we go.
Speaker Change: Obviously, the Mexico goal a bit unfavorable as the quarter progressed.
Speaker Change: Year progresses as communication starts coming back, but if you want to look at the whole year.
Speaker Change: It is really everything mix yen and.
Speaker Change: Basically the utilization by the input cost is the headway NAND even for next year I think that's going to be the case, where again continues now in Q1 the yen.
Speaker Change: Really a little bit down the reason being if you remember last year. The yen had moved down to about 130 level for a period of time and it takes a while for it to flow into the P&L, but as you can see the yen has strengthened.
Speaker Change: I mean, the dollar has strengthened and as a result with the inventory accounting I think that benefit will even flow quite a bit into next year. So I kind of feel that even for next year, we will stay at a higher level.
Speaker Change: Even though input costs, maybe are a headwind, but will remain if you're looking at a model on the higher end of our model.
Speaker Change: Thank you. Your next question comes from the line of Morris <unk> from Stifel. Please go ahead.
Speaker Change: Okay.
Morris: Yes. Good afternoon. This is Jeremy calling for Tori.
Speaker Change: Yes.
Jeremy: Two things here, maybe if we could just circle back on the intermix too it looks like a really fantastic product here.
Jeremy: I was wondering.
Jeremy: In terms of the DC to DC power conversion.
Jeremy: It seems like you've had developed some expertise there.
Jeremy: Is there.
Jeremy: Are there other areas, where you want to take this.
Jeremy: It's maybe more standalone DC to DC conversion products or where is the.
Jeremy: <unk> plus D C D C market big enough.
Jeremy: Near term.
Jeremy: To take up all your.
Jeremy: Resources at this point.
Speaker Change: Thanks, Jeremy.
Speaker Change: Just to clarify we don't actually implement DC to DC converters.
Speaker Change: What we have done within a month's too is that the single power supply and single magnetics that a single transformer.
Speaker Change: We are able to deliver multiple output voltages.
Speaker Change: Our current for that matter.
Speaker Change: That are individually regulated meaning that they can be independently.
Speaker Change: Trolled unregulated.
Speaker Change: For example, one output could be an LCD driver, where the voltage can vary with the intensity of priority and so on.
Speaker Change: But the rest of the outputs will not be impacted by that and that's a unique topology. We have developed we have a number of patents on that.
Speaker Change: No it actually eliminates the DC to DC converter. So we don't build visit because whereas we just eliminate them.
Speaker Change: Because you don't need them anymore.
Speaker Change: So we are still focused on high voltage, we're still a single stage high voltage power supply.
Speaker Change: Now this user set flyback topology, which is useful up to several hundred watts. So anything that falls within that power range at that requires more than one output voltage.
Speaker Change: He is a good market for that so basically that's everything other than adapters adapter is typically only have one output voltage, but literally everything else thats inside the product whether it's the TV monitor appliance.
Speaker Change: Any industrial application.
Speaker Change: It requires more than one output voltage and Thats, where <unk> becomes very attractive it is actually a quite a amazing invention I think.
Speaker Change: When we tell people there as they are quite surprised and is made possible by two things. One is a very unique controls game number two of our flagship technology without flex link you cannot implement this because it requires very precise control of how much energy is delivered to each output through the same platform, but that's just one.
Speaker Change: <unk> moment.
Speaker Change: Got it. Thank you that's very helpful for the clarification there.
Speaker Change: And I guess, maybe switching gears again back to Odyssey.
Speaker Change: Is it was there.
Speaker Change: I guess a couple of questions within here first is in terms of the technology is that something where you are it sounds like youre integrating their vertical again and see what you already developing internally or do you see like a slight bifurcation within the supply of Gan, where there's there's one focus on low cost is a different technology focused on this.
Speaker Change: Very high power and you need both technologies North Sea address.
Speaker Change: The full range of Gan applications.
Speaker Change: Okay. Good question I had mechanical how far I want to go with this.
Speaker Change: We normally don't discuss our R&D.
Speaker Change: Efforts.
Speaker Change: Let me see how I can answer this question, but let me make it one thing very clear.
Speaker Change: What Odyssey was doing what nexgen is doing and others are doing.
Speaker Change: Are very different from what we're doing.
Speaker Change: The reason to acquire Odyssey is to get the expertise not their technology, but the expertise.
Speaker Change: There are many aspects to our development.
Speaker Change: There are two or three challenges to overcome.
Speaker Change: And we believe that the.
Speaker Change: The team at artist he can help us with that because they just have fundamental background in Gan.
Speaker Change: Especially vertical again, so we think they can help us accelerate our efforts.
Speaker Change: And beyond that I'm, not comfortable giving a lot of information because it's very competitive.
Speaker Change: Inflammation.
Speaker Change: I think.
Speaker Change: For competitive reasons, we would like not to discuss it too much in detail.
Speaker Change: Okay.
Speaker Change: Fair enough. Thank you very much.
Speaker Change: You're very welcome Jeremy.
Speaker Change: Okay.
Speaker Change: Again, if you would like to ask a question press star one on your telephone keypad.
Speaker Change: Press Star one on your telephone keypad.
Speaker Change: Yeah.
Speaker Change: Alright, well it seems as if we have no further questions. So thanks, everyone for listening there will be a replay of this call available on our website, which is investors power com. Thanks, again and good afternoon.
Speaker Change: Ladies and gentlemen that concludes today's call. Thank you all for joining you may now disconnect.
Speaker Change: Please wait.
Speaker Change: France will begin.
Speaker Change: [music].
Speaker Change: <unk>.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: [music].