Investing.com
Published May 13, 2025 09:17AM ET
Silicon Labs (market cap: $4.1 billion) reported its Q1 2025 earnings, surpassing expectations with an EPS of -$0.08 against a forecast of -$0.09. The company's revenue reached $178 million, exceeding the projected $175.7 million. Following the announcement, Silicon Labs' stock saw a pre-market increase of 3.32%, reflecting investor confidence in the company's performance and outlook. InvestingPro analysis indicates the company maintains a FAIR overall financial health score of 2.02, with particularly strong momentum metrics.
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Silicon Labs demonstrated robust performance in Q1 2025, with a significant year-over-year revenue increase of 67%. The company's focus on IoT solutions, particularly in connected healthcare and smart home technologies, has driven substantial growth. The introduction of new products, including the BG29 family of Bluetooth Low Energy SoCs, positions the company well in the competitive IoT market.
Silicon Labs reported an EPS of -$0.08, surpassing the forecast of -$0.09, marking a positive surprise for investors. The revenue also exceeded expectations at $178 million, compared to the projected $175.7 million. This performance highlights the company's ability to manage costs and drive sales growth.
Following the earnings release, Silicon Labs' stock rose by 3.32% in pre-market trading, reaching $130.5. With a beta of 1.36, the stock shows higher volatility than the broader market. The company has demonstrated strong recent momentum, posting an 18.37% return over the past week and a 19.31% gain over the last six months. The stock remains within its 52-week range, with a high of $160 and a low of $82.82.
For Q2 2025, Silicon Labs projects revenue between $185 million and $200 million, anticipating a 32% year-over-year growth. The company expects gross margins to remain strong, between 55% and 57%. Silicon Labs aims to outperform the broader semiconductor market by focusing on design win ramps.
CEO Matt Johnson emphasized the company's strategic focus, stating, "We're not looking for broad market strength to drive this year for us." He also highlighted the company's resilience against tariff impacts, saying, "We see a path to outperform the market and drive this growth independent of how this all plays out with tariffs."
During the earnings call, analysts inquired about potential inventory build-ups and the impact of tariffs. Management reassured investors of minimal exposure to these issues and highlighted strong performance in emerging market segments. The potential for higher average selling prices with Series three products was also discussed.
Didi, Conference Operator: Hello, my name is Didi, and I will be your conference operator today. Welcome to the Silicon Labs First Quarter Fiscal twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during the session, you will need to press 11 on your telephone.
You will then hear an automated message advising your hand is raised. To withdraw your question, please press 11 again. Please be advised that today's conference is being recorded. I will now turn the call over to Giovanni Vacelli, Silicon Labs' Senior Director of Finance. Giovanni, please go ahead.
Giovanni Vacelli, Senior Director of Finance, Silicon Labs: Thank you, Didi, and good morning, everyone. We are recording this meeting, a replay will be available for four weeks on the Investor Relations section of our website at investor.silabs.com. Our earnings press release and the accompanying financial tables are also available on our website. Joining me today are Silicon Labs' President and Chief Executive Officer, Matt Johnson and Chief Financial Officer, Dean Butler. They will discuss our fourth quarter financial performance and review recent business activities.
We will take questions after our prepared comments, and our remarks today will include forward looking statements that are subject to risks and uncertainties. We base these forward looking statements on information available to us as of the date of this conference call and assume no obligation to update these statements in the future. We encourage you to review our SEC filings, which identify important risk factors that could cause actual results to differ materially from those contained in any forward looking statements. Additionally, during our call today, we will refer to certain non GAAP financial information. A reconciliation of our GAAP to non GAAP results is included in the company's earnings press release and on the Investor Relations section of our website.
I'd now like to turn the call over to Silicon Labs' Chief Executive Officer, Matt Johnson. Matt?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Thanks, Giovanni, and good morning to everyone. Silicon Labs drove strong first quarter results consistent with our outlook and showing momentum across the business. As we highlighted in our recent Analyst Day, we are well positioned to outperform the broader semiconductor market and our Q1 results illustrate that with both sequential and year over year revenue growth in both of our business units. Our Home and Life business grew mid single digit sequentially, nearly doubling year over year as share gains and connected healthcare continued materializing into production ramps. In addition, smart home applications showed signs of strength in the quarter.
Our industrial and commercial business continued its recovery growing high single digits sequentially and double digits compared to the same period last year. As design win ramps and smart metering and shipments to electronic shelf labeling customers maintain their momentum. While the overall macroeconomic environment remains uncertain, expect to outperform the market given our leadership position in high growth markets and a multi year history of share gains. As we look at the current quarter and the balance of the year, our conversations with customers and distribution partners indicate that we have no reason to change our forecast due to the dynamics of global trade policy at this point. Our outlook for sequential and year over year growth into Q2 is based on continued linear improvement in our bookings patterns and progress on new program ramps and secular growth areas like connected healthcare, smart home, commercial retail and global metering deployments.
Additionally, supply chain diversification is an area we focused on for several years, including as part of the roadmap for our next generation Series three platform. Our current footprint is not significantly affected by the shifting geopolitical landscape, although it's too early to quantify the potential indirect impacts of tariffs on global economic demand. We have not yet seen any significant impact on our customers' forecasts. Our team is focused on delivering innovative products that reinforce our breadth, depth and singular focus on the IoT space. This includes our latest Series two device, the BG29 family of Bluetooth low energy SoCs designed to bring industry leading performance, battery life, security and increased memory capacity to the smallest form factor Bluetooth devices.
The BG29 family represents a breakthrough in our ability to bring highly differentiated technology to connected healthcare applications, including blood glucose monitors as well as other wearable health devices. We also introduced our new BG22L and BG24L SoCs optimized for common Bluetooth applications. Notably, these devices bring the most competitive combination of security, processing power and connectivity for high volume, low power applications, including asset tracking and small appliances. The BG24L SoC also supports advanced AIML acceleration in the latest in Bluetooth channel sounding ideal for radio congested areas like warehouses, smart cities, and residential apartment complexes. Additionally, our recently announced series two multi protocol SoC, the MG26 is now generally available accelerating developers path to designing future proof matter devices in smart home and commercial applications like LED lighting, switches, sensors and locks.
The MG26 also sets a new standard for concurrent Bluetooth and 15 for wireless performance alongside best in class security as well as for machine learning capabilities that enhance performance for critical tasks like predictive maintenance, anomaly, anomaly, and keyword detection. As matter continues to pull thread technology into the mainstream, we're seeing our 15.4 design win momentum accelerate. This reinforces our view that we are well aligned with the increasing matter adoption as both the leader in threat technology and trusted partner internet security providers and ecosystem partners who are building our out matter infrastructure. Finally, at our Analyst Day, I was pleased to announce that our first Series three device, which was sampling last year, is now ramping to production. Series three will continue its broader Alpha sampling this year, We're already seeing strong design win momentum with the first device,
Dean Butler, Chief Financial Officer, Silicon Labs: which is a testament to
Matt Johnson, President and Chief Executive Officer, Silicon Labs: the great execution of the Silicon Labs team. While we believe Series three will be even more impactful than our Series two over a longer time horizon, as we further expand our addressable market in WiFi, compute and AI inference, our ability to offer our customers both Series two and Series three in parallel with co compatibility between the two platforms is a significant competitive differentiator for us. In conclusion, even amid trade uncertainty, we're highly confident in our ability to deliver sequential growth fueled by linear improvements in our order patterns and continued new product ramps across our business units. Looking ahead, we're well positioned to outperform based on our expanding presence in growing markets, differentiated product portfolio and continued share gains. Now I'll hand it over to Dean for the financial update.
Dean Butler, Chief Financial Officer, Silicon Labs: Dean? Thanks, Matt. Good morning to everyone. I will review the financial results for our recently completed quarter, followed by a discussion of our current outlook. Revenue for the March was 178,000,000 up 7% sequentially and in line with the midpoint of our prior guidance.
Year over year, consolidated revenue was up 67%. In our Industrial and Commercial business, March revenue was 96,000,000 up 8% sequentially and up 47% from the same period last year. Sequentially, the growth was driven by better than forecasted customer ramps in smart metering and continued electronic shelf label market growth. Home and Life March quarter revenue was $82,000,000 up 5% sequentially and nearly doubling with a year over year growth rate of 99%. As we anticipated, the sequential increase in Home and Life was driven by strength in smart home applications and shipments to connected health customers.
Sell through at our distribution partners continued to gain momentum with channel inventory decreasing by eight days to end at forty eight days, which is down from fifty six days in the prior quarter. This marks a new low level of channel inventory and is well below our targeted level of about seventy to seventy five days. Distribution made up approximately 66% of our revenue mix for the quarter. March gross margins saw positive improvements as long tail channel sales and industrial applications benefited our mix. GAAP gross margin was 55%.
Non GAAP gross margin was 55.4%, which was up from the prior quarter, above the midpoint of our prior guidance and ahead of our forecasted progression. GAAP operating expenses were $130,000,000 which includes share based compensation of $20,000,000 and intangible asset amortization of 5,000,000 Non GAAP operating expense of $105,000,000 reflects the normal uptick of the company's annual merit cycle and reset of the employee bonus programs. GAAP operating loss was $32,000,000 and non GAAP operating loss was $7,000,000 During the quarter, we recorded a GAAP tax charge of approximately 2,000,000 Our non GAAP tax rate remained 20%. GAAP loss per share was $0.94 Non GAAP loss of $08 per share beat the midpoint of our guidance by $01 Turning to the balance sheet. We ended the quarter with four twenty five million dollars of cash, cash equivalents and short term investments.
Our days of sales outstanding was approximately thirty days. During the quarter, we further reduced our internal inventory by $22,000,000 ending the quarter at $83,000,000 of net inventory, which contributed to our positive operating cash flow of $48,000,000 for the March despite operating losses. Days of inventory on hand improved to ninety four days, another sequential improvement from one hundred and twenty five days at the December end. I want to thank our supply chain team here at Silicon Labs for having successfully guided our internal inventory balance to our targeted level, and you should now expect to see an uptick in working capital deployment as we maintain these levels to support the ramp of new customer designs throughout 2025. Speaking of supply chains, we have completed a review of our supply chain and find that there is almost no direct impact to us under the current tariff rules as we know them today.
Given our wide berth of customers and applications, there are likely to be varying degrees of potential impacts to customers. The two outstanding questions are, one, what will the indirect impact of demand be when we are able and when we'll be able to measure that? And two, will the tariff rules change either positively or negatively as we go forward? As it stands today, our order patterns from customer bookings and distribution POS showed sequential improvement in the first quarter and have maintained this trajectory quarter to date into the June. An indication to us that our end markets are progressing in their cyclical recovery.
Additionally, our end customer surveys continue to report that excess inventory is not currently a concern. We are encouraged by these positive trends entering Q2, and as such, our confidence in above market growth this year remains intact, anchored by new product ramps rather than on a reliance of robust end market demand. We anticipate revenue in the June to be in the range of $185,000,000 to 200,000,000 which at the midpoint would imply 32% year over year growth and an 8% sequential growth. Importantly, we have not witnessed any significant customer pull ins and have kept our forecasting methodology consistent with prior quarters. We remain confident that Silicon Labs will outperform the broader semiconductor market this year despite the shifting trade dynamics given our unique new program ramps.
With improved mix of industrial applications and channel strength, we expect the gross margin improvements in the June with both GAAP and non GAAP gross margins to be in the range of 55% to 57%. We expect GAAP operating expenses in the June to be in the range of $129,000,000 to $131,000,000 We expect non GAAP operating expenses to modestly increase in the June, driven by full quarter accounting of payroll related items, including the company's bonus plans and annual merit cycle, resulting in an expected range of $106,000,000 to 108,000,000 Finally, GAAP loss per share is expected to be in the range of $0.55 to $0.95 loss on an assumed basic share count of 32,700,000.0 shares. Non GAAP earnings per share is expected to be in the range of $0.19 to a loss of $01 on an expected diluted share count of 33,000,000 shares. That wraps up our prepared remarks. I'd like to now hand the call back over to the operator to start the Q and A session.
Operator?
Didi, Conference Operator: Thank And our first question comes from Christopher Rolland of Susquehanna. Your line is open.
Christopher Rolland, Analyst, Susquehanna: Hey guys, thanks for the question and congrats on the results here. I guess there is obviously some uncertainty in the back half here. You guys seem pretty comfortable around it and the variability there. But how are you thinking about the September after a little bit of June upside here? Or perhaps just how the second half is shaking up overall?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yeah, I'll start that, Christopher. So first, we're only guiding a quarter at a time, but I think the pieces that are important to think through, and some of them were covered in the prepared remarks, everything that we look at or see, it's customer forecasts, bookings, billings, inventory level at our customers, at our distributors, all these things are behaving very well linearly So right now there's not anything else there to indicate that there's a big shift coming, which is important. Now obviously we're being hyper vigilant watching all these things all the time as I think the rest of the industry is. The other thing that's really important as you're thinking through this, as we've said consistently, we're not looking for broad market strength to drive this year
Giovanni Vacelli, Senior Director of Finance, Silicon Labs: for us.
Matt Johnson, President and Chief Executive Officer, Silicon Labs: We're looking for the performance this year to really come from the design win ramps that we've been talking about and that's what we're seeing here. So we're encouraged by that, happy to see the ramps, they're not singular, they're broad and that's really what's driving our growth, not a broad market recovery right now.
Christopher Rolland, Analyst, Susquehanna: Great, thanks so much Matt. And then I believe you thought maybe last quarter that home and life would outperform I and C but it seems like there was more I and C strength than Home and Life. It was kind of flipped. So perhaps you can talk about what was kind of unexpectedly good and bad between the segments and and how they shook out.
Dean Butler, Chief Financial Officer, Silicon Labs: Yeah. I don't know if there was necessarily unexpected, you know, good or bad, a little bit of timing, change, you know, maybe between the two of them. I would note that on a year over year basis, our home and life business was, almost double, up 99%, and industrial commercial is up 47%. I think our expectation is, hey, could INC grow that fast given sort of the sequential change that it had of about 8%, nine % in the quarter. The metering business, which we've said before, India specifically that business has been ramping faster than what we've historically seen.
And I think we were a little cautious whether that was able to continue and that metering business continues to ramp and actually ramping better than we originally anticipated, Chris.
Christopher Rolland, Analyst, Susquehanna: Thank you very much, Dean. Appreciate.
Didi, Conference Operator: Yep. Thank you. And our next question comes from Thomas O'Malley of Barclays. Your line is open.
Thomas O'Malley, Analyst, Barclays: Hey guys, thanks for taking my questions. My first one is just on inventory in the channel. So you guys have obviously worked that down pretty significantly. I think you said forty eight days of inventory in channel versus a target of seventy days. When you look at your June guidance, what's your target for channel inventory there?
Are you going to refill that or take that to new high levels? Like, just given the stronger demand environment, I'm curious what the strategy is for June.
Dean Butler, Chief Financial Officer, Silicon Labs: Yeah. Tom, the general expectation for the June quarter, we do not want to end June again at 48 or heaven forbid, even lower. I think if we look at the way that we're running our forecast, we would expect the channel forecast to come back above fifty days for the quarter, but certainly below sixty. So I think low 50 is probably where it will likely stand when we forecast into June. Eventually, we want to drive it back to the target level seventy, seventy five days.
That is a multi quarter progression. I would not expect to see us fill the channel in the June. Really, we're almost hand to mouth in a lot of these smaller long tail customers, but you won't see any big step up progression, at least the way that we see it to Datan.
Thomas O'Malley, Analyst, Barclays: Helpful. And then you guys have talked for a long time now about specific company wins driving the growth versus broad market recovery. For just context, can you help us understand as like a percentage of your revenue today, how much kind of in the March and the June, maybe if that snapshot is easier, is new product versus stuff that you would deem like broad based product? And then can you try to walk us through what the pricing difference is between some new products and something that you would sell on a broad based? I understand it needs to be probably loose commentary, but I think that'd be some helpful perspective just given how focused you are there.
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Sure. This is Matt. I'll take a shot at that. I mean, answers. Easy way to think of it, we don't break out the total revenue that way, but I can say a majority of the incremental revenue you're seeing is definitely coming from those new ramps.
That's a very easy way to think of it. And on pricing, not meaningfully different. In fact, I think you're seeing our gross margins progress each quarter even with this new ramp growth. So not meaningfully different and we see a path to being able to drive sequential revenue growth on design win ramps and sequential gross margin progression as well. So hopefully the sum of those two things gives you the the full picture.
Didi, Conference Operator: Thank you. And our next next question comes from Tore Svanberg of Stifel. Your line is open.
Dean Butler, Chief Financial Officer, Silicon Labs: Yes, thank you and congrats on the results. So Matt, I think in the past we've talked about, especially three new segments, you know, potentially each one representing 10% of revenues this year. I think we're talking about the shelf label glucose meter and smart meter. Are things sort of still tracking towards that number?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yeah, so big picture, Tory, are the three areas we've talked about the most, and we're seeing good progress in all three is the quick answer. And one thing that we covered at our Analyst Day that I'd also like to reinforce, not backing off of those three areas at all, those are going be growth engines for us for many years to come. And, you know, we also have introduced additional growth engines, such as Matter. We mentioned that Wi Fi is growing 40% for us, BLE growing 80%, both of those represent significant share gains. And we're really starting to see AIML start to increase as well.
So quick answer is those areas are going well. And you heard Dean mentioned, you know, maybe a little faster than expected in areas like metering in India, And we're also seeing additional growth vectors come online as well. So the combination, you know, is what's giving us that confidence to say we see a path to outperform the market and drive this growth independent of how this all plays out with tariffs.
Dean Butler, Chief Financial Officer, Silicon Labs: Tore, let me just give you one quick modification on a quantified number. You said 10% across all three. We had previously said the blood glucose is expected to be a 10% application. We had not quantified the other two, just so you have the right data point.
Matt Johnson, President and Chief Executive Officer, Silicon Labs: So 10% for one of them, not all three combined.
Dean Butler, Chief Financial Officer, Silicon Labs: Got it. No, that's fair. And my follow-up question is on Series two and Series three. Obviously, Series three is still very, very small. First of all, is Series two now more than half of revenues?
And how should we think about ASP increases as Series three starts to ramp more meaningfully?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yeah, so we haven't broken out the Series two specific, but it's increasingly larger and larger piece of the total revenue and it's what's driving the incremental growth you're seeing. All these design win ramps right now we're talking about are Series two ramps, which is worth pointing out. As I mentioned in our Analyst Day, we have shipped over a billion units in Series two lifetime to date, and we've secured or won five or 6,000,000,000 more units that we'll be shipping in the coming years and quarters. So there's still a lot more to come out of Series two. At the same time, we've already started production shipments on Series three and, you know, to answer your question on ASPs and expectations there, content's higher with, you know, increased wireless performance, increased compute, AI, ML, more memory scalability.
So I would expect, you know, overall higher ASPs on Series three Tori. So, you know, the most important thing for people to take away, Series two, is doing just fantastic in the marketplace and still has a lot to go. Series three, our goal is to meaningfully outperform Series two. And we're liking what we're seeing right now. We're already ramping production with a lot of products to follow.
So that combination of current gen, next gen, just bringing what it brings, we we like our positioning is is the best way to say it.
Dean Butler, Chief Financial Officer, Silicon Labs: Excellent. Thank you for that color.
Didi, Conference Operator: Thank you. Our next question comes from Cody Acree of The Benchmark Company. Your line is open.
Cody Acree, Analyst, The Benchmark Company: Thanks guys for taking my questions and congrats on the progress. Maybe if you can just give me a bit of a split for your expectations for the June between your Home and Life and Industrial and Commercial?
Dean Butler, Chief Financial Officer, Silicon Labs: Yes, Cody, we expect that the mix between those will probably be pretty consistent over the last couple of quarters. Last quarter to a first order, it landed industrial commercials about 55% and home and life about 45%. And that's been plus or minus a percent or two for the last sort of three quarters in a row. I would expect that to also be the case as we go into the June. And it's going to depend a little bit as all these you know, new programs ramp.
You know, we might be off of a point here or there. But to a first order, kinda 55, 40 five.
Cody Acree, Analyst, The Benchmark Company: Excellent. Thanks for the help. And then maybe just back to the tariff situation. Can you just talk about some of those end markets, those end applications that you believe are more exposed to tariffs than others? I have a hard time thinking through your end application mix and finding a lot that have tariff sensitivity, but maybe I'm just missing something.
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yeah, I think well, I think the quick and honest answer is it's difficult to answer because we really cover so much in terms of geos, end customers, applications, markets, etcetera. So extremely broad across, you know, tens of thousands of these, as we've said before. But, you know, maybe a way to abstract it up, and Dean just talked about it, you know, we do have a industrial consumer split of around 45, 50 five with industrial being the larger piece. So, you know, that's that's one way to think about it. The big picture, we haven't found any one of our end markets or major markets that's uniquely susceptible or exposed to this, at least as they are presented and out there so far.
But obviously we'll keep watching that closely. It's it's no, it's
Cody Acree, Analyst, The Benchmark Company: All right. Thanks, guys.
Didi, Conference Operator: Thank you. Our next question comes from Quinn Bolton of Needham and Company. Your line is open.
Quinn Bolton, Analyst, Needham and Company: Hey, Dennis. Let me offer my congratulations on the nice results and outlook. I wanted to follow-up on the inventory question, Dean. It looks like you're going to modestly increase channel inventory in the June. You said it would take several quarters to get back to the seventy, seventy five day target.
Is that something you would anticipate getting back to, say, by the end of the calendar year? Is that a good time frame for us to be thinking about when you would normalize or look to normalize channel inventory?
Dean Butler, Chief Financial Officer, Silicon Labs: I think that's without a stake in the ground, directionally right. I mean, I think the problem that we face, Quinn, is as POS continues to grow as the channel outflow due to the sale to all long tail end customers, we're sort of chasing a catch up, right? So as outflow increases, inflow sort of needs to increase in addition to that. And I think we are likely to pipeline material in there to slowly grow it over the next few quarters. Is it get to 70 by the end of the calendar year?
Maybe. It could take a quarter or two longer than that. Just depends on how the POS side of that equation is going, if that makes sense, Quinn.
Quinn Bolton, Analyst, Needham and Company: Yes, it sounds like it takes some time to stage the inventory on the way in. And if POS is better or worse than expected, that obviously affects inventory. So yes, I think it makes sense. And then I guess, Matt and Dean, just a question. There continues to be sort of some chatter out there, sort of bottom of the cycle that pricing continues to be pretty aggressive.
You guys are showing nice margin expansion. So it doesn't look like you're seeing any adverse effects from pricing. But just wondering if you could talk about what you're seeing in pricing on a like for like basis. I know the mix shift to Series two and Series three is a tailwind. But are you seeing fabbed competitors in particular get more aggressive with pricing sort of as we're near at the bottom of the cycle?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yes, I guess it felt you know, the quick answer on pricing is, you know, nothing has really changed. It's been consistent with what we've been seeing for a while now, where a lot of companies would like to have more revenue and they're trying to use pricing to get more revenue. Haven't seen that meaningfully move the needle at all in terms of share shifts or anything out there in our space. You know, we obviously need to be competitive on pricing, but we thrive relative to our competition on differentiation, bringing features, performance, capabilities, that no one else has. And that's how we have a premium gross margin versus anyone we compete against.
And, that's how, you know, we've been able to do, I think exactly what we said we'd do, which has been incrementally we start working back our gross margin coming through the cycle. So, foot cancer is no meaningful change. I think the market's behaving as the market behaves and no change in what we've been saying or our expectations.
Quinn Bolton, Analyst, Needham and Company: Got it. Thank you.
Didi, Conference Operator: Thank you. Our next question comes from Joe Moore of Morgan Stanley. Your line is open.
Joe Moore, Analyst, Morgan Stanley: Great. Thank you. You sort of talked about customers, you haven't seen any evidence of pull ins, seems like inventories are still under control. Can you talk about what those conversations are like? Because I just imagine, we've seen two years of inventory leaning out and now we're dealing with on again, off again tariffs all over the world.
It seems like if I were running your customers' business, I would want to hold more inventory, I would want to build ahead of
Quinn Bolton, Analyst, Needham and Company: some of that. Can you
Joe Moore, Analyst, Morgan Stanley: just give us some sense of what the interaction with customers is like during all of this?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yeah, Joe. This is Matt. I think the quick answer is, and I'm not being wise about this, but fortunately just having been through this inventory cycle, those numbers are all fresh and we've been taking the inventory assessment of our end customers all along, and we had to stop that. So, you know, this has just been a continuation of coming out the other side of the inventory correction cycle. And I think the fast way to answer what you're asking, no meaningful changes in end customer inventory, no one trying to build positions, that type of thing.
But what we do see is a lot of people saying the same thing, wondering what the trade policies will do over time. What will stick? What will go away? What the implications will be over time? And the honest answer is no one knows.
So, you know, I think, you know, uncertainty is the easy way to define it. So what that uncertainty hasn't done is driven behavior around inventory, and we're watching that super close.
Joe Moore, Analyst, Morgan Stanley: That's very helpful. Thank you. And then I want to follow-up. At the Analyst Day, you had talked about sources of inorganic growth that you would be willing to think about larger M and A, things like that. How do you see that in the current environment?
Are those deals more difficult to do in this kind of global tension? Or just how are you thinking about that?
Matt Johnson, President and Chief Executive Officer, Silicon Labs: Yeah, no change in our strategic desire there or direction. I think the quick answer is, right now there's just a lot of uncertainty around trade and where this will land and how it will play out. So haven't seen any meaningful changes as a result of that. I think it's probably too soon to say.
Joe Moore, Analyst, Morgan Stanley: Okay, great. Thank you.
Didi, Conference Operator: Thank you. I will now hand the call back to Giovanni Pacelli.
Giovanni Vacelli, Senior Director of Finance, Silicon Labs: Thank you, Didi, and thank you all for joining this morning and your interest in the company. Before concluding today's call, I would like to announce our upcoming participation in JPMorgan's fifty third Annual Global Technology, Media and Communications Conference in Boston tomorrow, May 14. We'll also be participating in Stifel's Cross Sector Conference in Boston on June 4 and Baird's Global Technology Conference on June 5 in New York City. Thanks again, and this concludes today's call.
Didi, Conference Operator: This concludes today's conference call. Thank you for participating, and you may now disconnect.
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