Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| Statement |
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| And Gary, with respect to Q2, we feel really good about the Q2 guidance |
| Double-digit market growth projections for our strategic growth areas and our design win momentum continue to give us confidence in the low double-digit long-term growth targets that we articulated at our March Analyst Day |
| We've also achieved record non-GAAP earnings per share of $0.39, an increase of 63% year-over-year |
| Our financial performance demonstrates the progress we are making towards executing the strategy that we laid out at our recent Analyst Day event |
| Having said that, we see the EV market continue to grow nicely and the added incentives that exist in China or were renewed in China around EVs, I think are going to be really good for the long-term growth of the EV market |
| E-Mobility, which includes the increasing electrification of vehicles and higher adoption of ADAS feature sets, continues to drive Allegro's above-market growth |
| Total Q1 automotive revenue grew 27% year-over-year, outpacing auto production growth of approximately 6% over the same period |
| Gross margin was 57.8%, consistent with Q4 and above our guidance range of approximately 56% due to favorable product and channel mix as well as favorable foreign exchange |
| And so we feel really good about the stickiness of that pricing as we go forward |
| Operating margin dollars increased by 56% year-over-year on a comparable sales increase of 28%, demonstrating the continued leverage in our operating model |
| Our design win momentum and the significant content opportunity associated with those design wins, continues to drive our above-market performance in automotive |
| Growth in Clean Energy and Automation drove 70% year-over-year sales increase in Q1, resulting in record Industrial sales |
| First quarter Industrial design wins leverage our sensor technology for DC charging, residential solar inverter and energy storage applications, where we see expanding opportunities for our solutions |
| And as Derek pointed out, it's a little hard to pinpoint the quarter-to-quarter transition exactly, but we feel really good about the mid- to long-term perspectives in China |
| So we're really confident and have a lot of conviction in our mid- to long-term thesis around China and the China OEMs |
| So we had a very favorable product mix in Q1 |
| I'm pleased to report that we had a strong start to fiscal year 2024, including record sales of $278 million, up 28% year-over-year |
| This helps designers achieve their efficiency and power density goals in Clean Energy and e-Mobility applications |
| And so on the mid- to long term and certainly the visibility we get into our forward-looking business makes us feel really confident about the growth rates that we committed to at the Analyst Day |
| Our design wins continue to be really good |
| That said, our order patterns continue to be very strong |
| But on the whole, we are very pleased with the progress we've made |
| I would say that, I think starting with lead times, we're really pleased with the work the teams have done to bring our lead times back into what are so called industry standard lead times |
| Global auto production remains robust and is expected to increase by 5% in calendar '23 to nearly 87 million units and EV sales are projected to grow by approximately 30% |
| As we -- after the need for more clean energy with innovative, efficient, socially responsible and environmentally conscious solutions, we're building long-term value for all our stakeholders |
| I want to thank our teams who delivered another outstanding quarter, while further accelerating our strategy with the launch of innovative new products and moving our ESG initiative forward |
| It's really China, and the commentary was very China-specific that it's hard to sort of pinpoint exactly the quarter-to-quarter transitions, we're really bullish about the mid to long term |
| We've also benefited from the transition in Japan from Sanken as a distributor -- as a Tier 1 distributor to the distribution channel, and that's been marginal |
| Q1 sales were a record $278 million |
| I'm excited about the launch this quarter of the first device in our new Power-Thru portfolio that leverages technology from our acquisition of Heyday Integrated Circuits last October |
| Statement |
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| Other sales, which includes Consumer and Computer Applications were $20 million, declining 30% sequentially and 27% year-over-year |
| Our sales in China in Q1 declined 13% sequentially or 7% on a comparable 13-week basis |
| We are, however, cautious in the near term given the macroeconomic uncertainty with increasing interest rates, inflation and geopolitical concerns |
| And that has driven some excess inventory of the leftover models that are perhaps not compliant to the new emission standard |
| And I think your comments said that they were down about 30% in the first quarter |
| Derek pointed out that auto production declined in China in the first half |
| Near term, like we said, it's going to be a choppy market |
| And I guess we've heard some commentary from others, perhaps some uncertainty about what will happen with foundry pricing as we go into next year |
| More specifically, we are monitoring China closely, where auto production declined 15% in the first half of calendar '23 |
| You mentioned it declined 7% in the quarter |
| So within Q2, I'd expect sales to distribution to be down marginally and sales to OEMs to be up slightly |
| Now China does have some specific issues that it's dealing with |
| And so you can expect us to continue to bring down our lead times |
| But we believe that in the near term, there is going to be choppiness across all our end markets |
| The Industrial segment, it seems like it's going to be down after a couple of quarters of very strong growth |
| It sounds like you're seeing perhaps some volatility in the auto business in China |
| Industrial continues to be, from an inventory standpoint, still elevated |
| Gary Mobley I appreciate the qualitative comments with respect to visibility, but maybe if you can quantify things a little bit more and quantify what your customer order lead times are given that, I believe, the link with backlog as you cited, is down 30% sequentially |
| And as we've said before, as lead times come back into a normal range, we expect the backlog to moderate |
| As you know, that troughed about a year ago |
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