Monolithic Power Systems Q4 2024 Earnings Call Transcript

Quartr
Provided by Quartr
February 6, 2025

There are 15 speakers on the call.

Operator

Welcome, everyone, to the MPS Fourth Quarter twenty twenty four Earnings Webinar. My name is Genevieve Cunningham, and I will be the moderator for this webinar. Joining me today are Michael Singh, CEO and Founder of MPS Bernie Blagen, EVP and CFO and Tony Ballo, Vice President of Finance. Earlier today, along with our earnings announcement, MPS released a written commentary on the results of our operations. Both documents can be found on our website.

Operator

Before we begin, I would like to remind everyone that in the course of today's presentation, we may make forward looking statements and projections within the meaning of the Private Securities Litigation Reform Act of 1995. That involves risk and uncertainty. Risks, uncertainties and other factors that could cause actual results to differ from these forward looking statements are identified in the safe harbor statements contained in the Q4 twenty twenty four earnings release and in our SEC filings, including our Form 10 ks, which can be found on our website. Our statements are made as of today, and we assume no obligation to update this information. Now, I'd like to turn the call over to Bernie Blagan.

Speaker 1

Thanks, Jen. Good afternoon, and welcome to our Q4 twenty twenty four earnings call. In 2024, MPS posted its thirteenth consecutive year of growth with full year revenue of $2,200,000,000 up to 21% from 2023. For Q4 twenty twenty four, we had record quarterly revenue of $621,700,000 above Q3 twenty twenty four and thirty seven percent higher than the fourth quarter of twenty twenty three. This performance reflected the strength of our diversified market strategy, consistent execution, continued innovation and strong customer focus.

Speaker 1

Let me call out a few highlights from 2024. We introduced the silicon carbide inverter for high powered clean energy applications. Initial revenue is expected to ramp in late twenty twenty five. Other silicon carbide based applications are expected to be introduced in multiple geographies during both 2025 and 2026. We developed a family of high quality, cost effective automotive audio products utilizing DSP technology from our 2024 Exyne acquisition powered by MPS Solutions.

Speaker 1

For enterprise notebooks, we launched a battery management solution and are sampling a new mini phase power stage. These products enable faster charge time and significantly improved notebook battery life. Building on our first analog to digital converter design win in 2024, we are developing new high accuracy 24 bit converters which are expected to ramp in the second half of twenty twenty five. MPS continues to focus on innovation, solving our customers most challenging problems and maintaining the highest level of quality. We continue to invest in new technology, expand into new markets and to diversify our end market applications and global supply chain.

Speaker 1

This will allow us to capture future growth opportunities, maintain supply chain stability and swiftly adapt to market changes as they occur. Finally, I'm pleased to announce our quarterly dividend will increase 25% to $1.56 per share. And during Q4 twenty twenty four, we completed share repurchases under a twenty twenty three six forty million dollars authorization. This week, our Board of Directors authorized a new $500,000,000 3 year share repurchase program. For the three years ending December 2024, MPS has returned 86% of its free cash flow to shareholders through share repurchases and dividends paid.

Speaker 1

Our proven long term growth strategy remains intact as we continue our transformation from being a chip only semiconductor supplier to a full service silicon based solutions provider. I will now open the webinar up for questions.

Operator

Thank you, Bernie. Analysts, I would now like to begin our Q and A session. As a reminder, if you would like to ask a question, please click on the Participants icon on the menu bar Our first question is from Tore Svanberg of Stifel. Tore, your line is now open.

Speaker 2

Yes. Thank you and congratulations on the solid results. Either Michael or Bernie, could you talk a little bit about the dynamics here in the March, especially by segment? Obviously, we know some end markets are still soft, yet others are actually quite healthy. So any more color on how you see the various segments in the March would be really helpful.

Speaker 1

Sure. As far as our Q1 outlook, I think need to take the perspective that relative to the size of the market, we're a fairly small player. But we have a lot of greenfield design wins, which have been previously delayed that are now starting to ramp as we enter 2025. So when we look at two of the areas that are going to drive most of the growth in the quarter, automotive is continuing to grow and communications, where we launched some new products in Q3, are bouncing back from Q4 and will continue strong. Memory's demand profile is also very good and notebooks look to be having a Q1 uplift.

Speaker 1

We don't know for sure, but we've had many design wins and believe that those are coming into the market. On industrial consumer, we have a lot of new product ramps, but those are likely to start to contribute at the end of twenty twenty five. And on the enterprise data will be down.

Speaker 2

Very good. And as my follow-up on enterprise data, how should we think about that business throughout calendar twenty five? Again, obviously, a lot of different dynamics, you know, different players, you know, the growth trajectory for that business throughout calendar twenty five. Any color you can share with us there?

Speaker 3

Yeah. We don't talk about it in near terms in the Pacific customers as we always do. The near term is that we can't control our customers' buying pattern, their allocations. And this year's but overall, this is a multi billion dollars market segment. We are getting ready for these next few years growth and it's clearly is a multi billion dollar opportunities.

Speaker 3

But for us let's in in year terms we this year could be even or maybe slightly up. Okay. We this is our best guess. We don't know.

Speaker 1

Yes. Just to add a little bit of color to how we see the year rolling out, we believe that we will be off to a slower start in the first half of the year. But as the year develops, the customer base is expected to broaden as hyperscalers launch their new products. So we have multiple product ramps with both existing customers as well as with these new hyperscalers. So as Michael just said, we believe it's likely to be a flattish year, but we believe that from a quality and supply availability perspective, we're in very good shape.

Speaker 3

Could be up too. We don't know.

Speaker 1

Yes, exactly.

Speaker 2

That's fair. Congrats again on the results.

Speaker 3

Thank you.

Operator

Our next question is from Rick Schafer of Oppenheimer. Rick, your line is now open.

Speaker 4

Yeah. Thanks, guys. I'll add my congratulations. And if I could maybe tack on to the back of Tor's question, I was wondering if you could update us maybe just to give us a sense of the number of the accelerated projects that you expect to ramp this year and and into 2026, just to kind of get a sense. I I heard you loud and clear, Michael, that this is a a billion dollar plus TAM.

Speaker 4

I'm just trying to get a sense of how many

Speaker 3

So multiple billing points.

Speaker 1

Oh, multiple billion.

Speaker 3

Yeah. Don't be shy about that. We're not shy on that. And then, like, we don't wanna lose that. Okay?

Speaker 5

Hey, Rick. This is Tony. I'll I'll jump in. I think I what we want to say is we're engaged across all the hyperscalers. But what you heard Michael say was that the exact timing of the ramp is very difficult for us to call.

Speaker 5

So I don't think we want to put a specific number of customers that are exact ramp times out there other than saying that we're engaged broadly across them? As Bernie said, we believe that's gonna scale through the second half.

Speaker 3

I can give you examples. And we we foresee that these projects are gonna ramp. In the 02/2022, '2 thousand '20 '3, you look at the automotive side, we said that we have a lot of design wins. And, we said all these are gonna ramp up, but we put a lot have a lot of inventories. And 2023 is kind of flattish years.

Speaker 3

Our customer delayed their their launch. So the '23 affected us. And, but I keep saying, we don't really care. And as long as we have a product and designing and designing their new product, especially, and we're turning to a revenue plus minus twelve months, eighteen months.

Speaker 1

And if I could just add to Michael's comments there, when you look at automotive, it was delayed not just in 2023, but also in the first half of twenty twenty four against what we had built inventory against our expectations. But now as you can see, it's very solidly on track with two consecutive quarters of growth. And likewise, you could apply that same formula to what we're seeing in the communications with the release of the fiber optics in the data center. So we have the technology, but we're intersecting some ramps in the market. A lot of that's a little bit out of our control.

Speaker 3

Well, even directly AI powers, and, okay, we have so many projects working with multiple hyperscale companies. And so we cannot tell which one is well ramping first. Okay. I know what the magnitude is ramping. Just we get the supply chain ready, get our quality testing facility ready to to, to get these, to to receive these revenues.

Speaker 3

Okay? Turning to these revenues. And, so the timing, we care less.

Speaker 4

Thanks for all that color, Michael. It's funny you're talking about auto because that's my second question, if I could. The EV conversion to 48 volt power and to 800 volt batteries is sort of set to ramp this year, I believe. And I know you mentioned in the prepared remarks, Bernie, that you're going to be shipping power installation content second half, I think I heard you say. And I believe EV is about three quarters of your auto business.

Speaker 4

So, I just wonder if you could talk us through sort of what your potential content, given all those changes, right, all these additional drivers, you know, what your content looks like last year or potential content per vehicle versus what it looks like, you know, in 2025 with all this with all these new, with all these new jump balls?

Speaker 3

That's very good questions. And, I'm we mentioned about 48 volt system many, many years ago, Tinuke. And, particularly for auto now, Tanaka, it became a hot topic and we have all these products ready. We're designing those new vehicles and these are based on 48 volt systems, we can capture a lot. And, once their products, once their vehicles are ramping up, put on the market and initially will be another dominant players.

Speaker 1

And I think that this is, the rollout in automotive starts with EV, which is quicker to adapt new technologies onto their platform. But we expect it to continue for a multi year period.

Speaker 3

Yes. Again, MPS, again, we provide a 48 volt integrated solutions. And all of these high power modules are based on the MPS silicon solutions. And those were significantly changed, all these discrete way of doing a crude together the 48 volt solutions. So that definitely sets MPS apart from the rest of our competitor.

Speaker 5

And Rick, beyond just pure 48 volt, remember what you saw beginning Q3 was designs outside of ADAS start to hit the market. We saw more broad based growth in the auto segment, and we'd expect that to continue as additional sockets come to market. So I think that's the other dynamic that's happening as well.

Speaker 4

Great. Thanks, you guys.

Operator

Our next question is from Ross Seymore of Deutsche Bank. Ross, your line is now open.

Speaker 6

Can you hear me now?

Speaker 1

Yeah. Hi, Ross.

Speaker 6

Perfect. Hi there. Just wanted to revisit the enterprise data side of things and not to overplay that, but the market share gains in Dynamics in the server CPU side of things, has that changed at all? Because I think everybody knows what's going on with one key customer and the diversification, you know, market share shifts and those sorts of things. But you guys have other things that are happening as we speak as well.

Speaker 6

So I really wanted to focus on the dynamics outside of those, not just with the ASIC providers and other GPU providers, but also with the CPU market share and servers. So any update on that would be helpful.

Speaker 3

Ross, let me let me say something, else first. Our inventory low our inventory low and the channel inventory is low. We're gonna ramping up.

Speaker 6

Okay?

Speaker 3

Okay. And the rest of our stuff, okay, Bernie.

Speaker 1

To. I don't know if I had to follow-up on that. It's a very good question. And let me let me just give you a little bit of what we're seeing. It's a fast changing landscape.

Speaker 1

And what I mean by that, it's difficult to offer commentary on enterprise data in in its in these different components. The lines between CPU and GPU are becoming blurry. And, in support of both lines of business, we have a lot of standard products. So, while we've historically had better visibility in the separation and could track them a little more easily, it's hard for us to make more than just a generalized comment about what direction either market segments going in.

Speaker 3

Yeah. Let me add it. Okay. We have a we're getting significant shares about on the on the server side. And, once you see the server markets start to ramping up, while the MPS revenue will ramp with it.

Speaker 6

Great. I guess as my non inventory follow-up, on the communication side, you guys did well on that in the second half of the year. It's a little bit choppy still. But can you just give us an idea of the profile of that business? How much is kind of the old comms versus the new comms?

Speaker 6

And give us a little bit more color on what the growth driver is that gives you the confidence for the year? And I assume it's on the optical side of things, but just a little it's just, you guys have been talking about that growing for many, many years and it finally did last year, but I know there's some legacy pieces and some new pieces. So I just wanted to try to get some color on the difference between them.

Speaker 5

Yes. Ross, I think you kind of hit it when you were asking the question, right? If you could comps going forward, their area of strength that we've really been calling out is in optical, and we'd expect that to continue as part of the overall data center opportunity that you you heard Michael talk about. So I think that's probably the biggest inflection point that you've seen over the past couple of quarters versus the legacy business.

Speaker 6

Got it. Thank you.

Operator

Our next question is from Gary Mobley of Loop Capital. Gary, your line is now open.

Speaker 7

Hey, guys. Let me extend my congratulations as well. I wanted to start with a housekeeping question. Were there any greater than 10% customers in fiscal year twenty twenty four? And if you can't name the customer, can you at least give us a sense of how big that customer was in the year?

Speaker 1

Certainly. For the three quarters, Q1, Q3 in our 10 Q, we said that we had, two direct customers which are distributors that were greater than ten percent and one indirect customer that was greater than 10%, and that carries through for the full year as well.

Speaker 7

Okay. But you can't give us a number that we'll publish in the 10 k in terms of the percentage of revenue from that direct customer?

Speaker 1

Not at this time.

Speaker 7

Okay. I tried. Alright. I wanted to ask about revenue diversification outside of your traditional power management market. And if I count correctly, there's maybe four shots on goal and you highlighted some of those in your press release and that would be data converters, silicon carbide, DSP audio, and battery management systems.

Speaker 7

So my question is, you know, how big in revenue terms can that be in the fiscal year twenty six time frame? Or said differently, how much of a growth catalyst can it be on top of what you're producing in traditional power management?

Speaker 3

Traditional power management is they're talking about these are low voltage things. If it's what you mean. And, okay, the silicon carbide is, of course, to me is also in the power management. And, but these are much higher powers, very high power management. And we don't want to put on numbers, but these are, again, it's a billing a couple billion dollar opportunity for all of them for for MPS.

Speaker 3

I don't wanna put a timeline on it. Okay.

Speaker 5

I was and the only thing is, you know, we picked a couple for the script, but we only, could put a few in for time. But I think our strategy continues to be plant a lot of seeds in a lot of different areas that can turn into revenue as the market decides what to prioritize.

Speaker 3

Well, that's a good point. And they are only yeah. We had a March 20, so we have an Analyst Day, okay. And this time you come over, you will see a lot of showcase on the MPS new technologies. And these all will contribute in the next few years of growth.

Speaker 3

Okay. And, if you wanna paint on what what is the numbers and, okay, I would say that, okay, if you look at the past for NPS, what the, model is, we will I don't see anything any any reason we should change. Okay? So faster or slower.

Speaker 7

Thanks, guys.

Operator

Our next question is from Quinn Bolton of Needham. Quinn, your line is now open.

Speaker 8

Hey, guys, Alfa. My congratulations as well. I guess Bernie and Michael, obviously, a very strong start to the year in the March. Your comments about enterprise data certainly sound like that business might be more second half weighted. And so I guess I'm just trying to think, what sort of revenue pattern would you expect through 2025?

Speaker 8

Is the first half slower the second half materially stronger? Do you think that you have some puts and takes and so it's a kind of more linear ramp through the year? Just any sort of thoughts on the shape of revenue through '25 would be helpful.

Speaker 1

Yeah. So the comment that we made as far as the outlook for the year, really looks at, you know, the design wins we've secured and an expectation of what is going to be ramping. Keep in mind though that particularly in the AI side of enterprise data that that has tended to be very volatile and that we have relatively short lead times as far as when we get hard information or POs for actual delivery. So I think that within the context of what we believe is most likely to happen, we're very secure by saying a flattish year that's weighted to the back half, but how that curve actually plays out over the quarters is to be determined.

Speaker 3

Yes. Let me add it. Okay. Bernie said volatile means that this industry is not okay. This applications, if you will, and again, and very at the is at the initial ramp.

Speaker 3

And so you're only involved with a we have a few customers. Now, so like we talked about it before, so we have multiple customers, okay, and they start to ramp. So it's very good for NPS. We focus on the diversifications and even within a single segment.

Speaker 8

Kenneth, I guess that was going to be my sort of second question, just thinking about the enterprise data segment. Can you just give us a sense what you're seeing in terms of one, like for like pricing pressure and then two, I think some of the newer designs really move away from a silicon only solution to much more of a module solution and I assume that those carry, you know, much higher dollar content for you. And so do you see, you know, as you mix the customer, you ramp some of the new hyperscaler designs. Do you think the blended ASP trends in that business, even if you see some like for like pricing, can that go higher through the year as these new platforms ramp?

Speaker 3

Well, NPS is going to stick with our models in that game and margin models, gross margin model. We provide performance. And if it doesn't fit the MPS business model, we don't take those business. And so far, we're the leading suppliers in silicon as well as the power modules. And so, this is the reason we in a very short time in the last twelve, twenty four months, we have engaged with all these hyper scales.

Speaker 3

We have all these projects DesignLink. And also, we have future products where many future products are in the development.

Speaker 8

Got it. Thank you, Michael.

Operator

Our next question is from Chris Caso of Wolfe. Chris, your line is now open.

Speaker 9

Yes. Thanks. I guess just to start, I just want to make sure I understood correctly some of the comments. So when you hear about the enterprise data flattish for the year weighted to the back half, and I'm assuming that's the entirety of the enterprise data segment, not just that associated with AI. And maybe you could talk about how, you talked about some of the hyperscalers, some of the custom ramps happen in the second half of the year.

Speaker 9

Is that what's driving that strength in the back half of the year? What's kind of driving that back half waiting?

Speaker 1

Chris, that's an accurate observation. As we look at the ramps for those SoCs and some of the tensor processor products that are expected to come out, We've been prototyping those, but the revenue ramps are really weighted to the second half. And in addition, some of our existing customers in the AI business in particular have multiple new products that they're ramping and those will have different demand profiles as well. And then that's just within the enterprise data. I think another important ingredient is what we've referred to as the trickle down effect, as we see the other applications that are allied to enterprise data or AI specifically in memory, optical and networking.

Speaker 1

And all three of those are areas for growth as well during 2025.

Speaker 5

Right.

Speaker 9

And I guess, as you look at the full year, obviously, from what you guys are seeing and the better than the seasonal Q1, I'd safe to say you're starting out a little better than some of the others in this space. What's your thought as you go through the year? I mean, is there any lumpiness with regard to some of the opportunities that are ramping early in the year that we should consider as we go through the year? Or is excluding the enterprise data's business, do you see revenue kind of on a fairly stable upslope trajectory as you go through the year?

Speaker 3

Yes. I can tell you something. It's very difficult to say. Surely, you go by year by year. We don't go by year by year.

Speaker 3

But although we have to report a year by year. And I'll give you examples. Our large customers start to push out some product, pulling a lot of other ones. So we can't really tell. And other customers, other hyper scales start to ramp, okay, start telling us we're going to keep a ramp.

Speaker 3

Whether the ramp have effective move our revenue needles in Q4 over this year or Q1 over next year, we can't tell.

Speaker 5

Yeah. Maybe the only thing I'd add on, Michael, is it just comes back to the focus on what you can control. Right? And the organization looking at providing the best products with the best quality and that's what we can do right now and as the market then plays through that will turn into revenue. So I don't think we're trying to get into a quarter by quarter debate here, Chris.

Speaker 5

I think that's how we've more landed kind of in a first half, second half dynamic at this point.

Operator

Our next question is from Joshua Bukalter of Cowen. Joshua, your line is now open.

Speaker 10

Yes. Thank you for taking my question. A couple of times, you've talked about the hyperscale program sort of driving growth more so in the back half of the year. I guess if we compare these sockets to, you know, what you've already done in in AI and the accelerator side, there's a lot of companies in the analog space that are saying that they have power engagements with ASIC vendors as well. Would you expect the majority of these merchant the ASIC programs to be dual sourced?

Speaker 10

And I I know you're not gonna necessarily quantify share, but I'd just be curious to hear how you're seeing the competitive environment in these sockets. Thank you.

Speaker 1

Sure. Let me take the first opportunity there. If you look at our most recent track record in the new, and I'd say new, relatively new AI business, the reason we were able to secure a lead position initially is because of our ability to innovate and our time to market along with our overall performance characteristics. So to the extent that that is valued in these product launches, those are the qualities that give us an opportunity to have a first mover advantage. But as we've said a couple of times on this call that when we look at our customers, we don't necessarily control what their decision process is or why.

Speaker 1

And so again, we lead with our strengths and believe that we're well positioned and then we'll see how the numbers turn out towards the end of the year here.

Speaker 3

Yeah. You you mentioned the second half. You're paying that down as on the second half of the ramp. What we mean is in in the very near futures. Yeah.

Speaker 3

It could be q one q one of next year's or could be q three of this year's or even even overlapping in q two. And a lot of things as I said earlier, okay, and our large customers, some of the push out, other ones are pulling to, okay, I mean, pulling very urgently. Again, so we cannot tell.

Speaker 1

I guess to put a punctuation statement, we remain cautiously optimistic, but our momentum is certainly in the right direction.

Speaker 3

Oh, that's the that's the professional way to say it.

Speaker 10

We always get the more professional answers from Bernie. Okay. No. Thank you. Thank you both for the color there.

Speaker 10

As my follow-up, I guess, you know, you're kind enough to give sort of a a rough outlook for enterprise data growth for 2025. Any more clues you can give us on how you're expecting either at the company level, 02/1945 growth to shake out and any sort of which segments you would expect to be the biggest contributors to growth? Thank you.

Speaker 3

Biggest ones, we're thinking there's a multiple of them. Yeah. And, where the multiple of them will will ramp in a different many different segments. And sometimes we pick the numbers and like it was wrong, okay, but other ones are coming up. And, we focus on the diversified growth that is the key strategies.

Speaker 3

We've been playing the same, principles in the, for last twenty five years. And, if this thing doesn't work and then other things will work. Okay. That's always our strengths. And, as long as we bring up the best performance highest performance product in the market, we will if this segment slows down for whatever the reasons, other segment will pick up.

Speaker 10

Thank you both and congrats on the results. Thank you.

Operator

Our next question is from Will Stein of Truist. Will, your line is now open.

Speaker 11

Great. Thanks for taking my question. We start with, what everyone's been asking about is enterprise data. I think you highlight, Bernie, that it's gonna be down sequentially. Can can you give us a little help on the modeling?

Speaker 11

Because, you know, down could be down, like, 3% or, like, 30%. Maybe just dimensionalize it a little bit to give us some context, please.

Speaker 1

Yeah. I I think that it'd be really hard again, what Michael just said is that the strength of our model is the diversification. And I would probably point to the outlook that we've given in total for Q1 as being a risk profile that we believe we can deliver comfortably against based on what we can see in our backlog and the continuing the ongoing ordering patterns. But again, trying to actually stratify with a level of precision on the end market at this point might be difficult.

Speaker 3

Yes. You may looking for precision. And the realities in the business, we go for long terms and, we go for long term. It doesn't mean near term would have uplifting. Okay.

Speaker 3

You know, in in our revenues. Okay.

Speaker 11

Yeah. Clearly, my ability to model the near term is is problematic. A follow-up if I can. Maybe let me switch gears a little bit. Michael, I think in the past, you talked about having some capability in microcontrollers.

Speaker 11

Historically, you know, I I know that it's not like a focus, or it's it's not a meaningful part of your revenue as well as I understand. Should we expect that to change? There's so many new products. You talk about silicon carbide power and converters now and DSPs even, should we expect microcontrollers or or another any other digital sort of logic technology to become a bigger part of your revenue over time?

Speaker 3

Very good questions. And, we don't list out a microcontroller as a standalone standard product that we sell. As a matter of fact, we as a as we have a many, we sell many microcontroller now. Okay. And, as I recall in my mind can come up twelve, thirteen microcontroller projects is ongoing.

Speaker 3

Some of the stuff is shipping, but what we sell microcontroller is on the system level. And as Bernie earlier said in the last field conference, so this NPS is evolving to a silicon based solution company. Microcontrollers plays a key role and all these powers, all these other lighting, all these other audios and including power supply, including AI's, they all have a microcontrollers in it and we don't list separate the items in the standard microcontroller part, but a

Speaker 1

lot

Speaker 3

of clearly also a lot of microcontroller were integrated. And, that's the reason we don't list it apart. This is separated. Okay.

Speaker 11

Thank you.

Operator

Our next question is from William Kerwin of Morningstar. William, your line is now open.

Speaker 12

Hey, everyone. Thanks for letting us get a question in here. A lot

Speaker 8

of good questions so far, so

Speaker 12

I'll try not to beat any dead horses. But maybe it sounds like at least in the March, automotive, communications seem to be driving some of the growth. So I'm wondering if you could just give a broader view into the demand for those markets for 2025 and your opportunities for share gains in in those two.

Speaker 1

Sure. Well, good to hear you in the Q and A, by the way. When you look at the end markets, most of the ones that we have are long design cycles. And automotive probably lends itself to being the most predictive because we secure a design win two to three years for an EV in advance of when it gets launched or as many as four to five years for a traditional internal combustion. Now having said that, the timing of those ramps, when we get the design win comes to market, still remains a question mark.

Speaker 1

But within the context of six to nine months, we can be reasonably predictive. So in automotive, we see continuation of what's been driving our last two quarters of growth as far as EVs in China. And those will be supplemented in the second half of the year more likely by a European OEM that is going to be bringing up a autonomous driving ADOS solution as well as additional content opportunities in North American EV company. And then when you look at the communications side, I think that is we're very early stages of being able to ramp the revenue opportunities, particularly in fiber optics. We started out with two primary customers, but that we expect that customer base to diversify over the year.

Speaker 3

As always the pattern. Yeah.

Speaker 12

That that's excellent. And then, you know, maybe one just on, you know, some of the new products that were introduced at the start of the call. Really just which one of these maybe excite you the most and, what are the new markets that you might be able to enter with these that are, the most attractive do you think from a growth perspective? Thanks.

Speaker 3

The most exciting product we haven't announced yet. Come over come over to our analyst date. March 20. March twentieth. Okay.

Speaker 3

And these are equal babies and okay. They all grow should be very same same rate.

Speaker 5

Again, we we picked four, but there's many more behind that. So it's it's hard

Speaker 1

to pick just one. Actually, we wanted to have a teaser to make sure we had the best turnout for the investor day.

Speaker 12

Okay. Excellent. Well, we'll, we'll wait for more detail in March. Thanks, guys.

Speaker 3

Alright. Okay.

Operator

Our next question is from Hans Mosesman of Rosenblatt. Hans, your line is now open.

Speaker 13

Thanks. Congrats, guys. I'll be quick. What is the split for your enterprise data between AI and non AI, if if that's possible? And I have a follow-up.

Speaker 1

Yeah. Again, I think we already answered that question by saying that those lines are getting blurry. So we really don't have a meaningful meaningful way to make that divide.

Speaker 3

And and our customers are not and, we're not we're not, not appreciated. We are we are disclosed those numbers. And, our customers have made it very clear.

Speaker 13

Is, is, non AI considered memory and optical

Speaker 1

historically? Just out of curiosity? Different market segments.

Speaker 5

Optical and communication, memories and storage.

Speaker 13

Fine. Okay. At the risk of upsetting your customers, if you answer, what is the share between your historical AI customer for this year versus accelerator, customers? What's the split? Is it ten ninety or fifty fifty?

Speaker 3

For this year and at the end of end of the year, and we we probably have a more or in the near term where we have a more clear pictures, but then now we don't. And we are in a frankly, as Bernie said, we're not in a position to answer it. And again, and also by either by product, they share the same product and, and also, so like our customers doesn't want us to release these informations.

Speaker 13

Okay. Thank you very much.

Operator

Our last question is from Joe Cucracki from Wells Fargo. Joe, your line is now open.

Speaker 14

Yes. Thanks for taking the questions. Just curious on the notebook strength that you guys are talking about into the first quarter. Wondering this, what's driving that? Is that strength from that you're starting to see pull for AIPCs or is that channel refill?

Speaker 14

Just trying to understand some of those dynamics.

Speaker 1

That's a great question. In fact, we believe that a lot of the design wins that we've had in notebooks more recently are tied into new AI product demand. But as I said, it's a little bit of an atypical ramp for Q1. So we really don't have a definitive answer on the why behind it.

Speaker 14

Got it. And then just trying to think about the new projects that are ramping in the second half for enterprise data. Any help that you can provide and just try to think about like the architectures of those solutions that you're shipping to your customers? Are you still largely seeing those as being lateral power opportunities? Or are they starting to move to more vertical solutions?

Speaker 5

Yes. I think you heard us talk a couple of times that we're not going to talk specific to any customer or their particular architectural solution. I think for us, what you see us again, folks in is providing a portfolio of products with the best quality, the best performance, and then the customers can choose what works for them.

Speaker 1

And going back to Michael's earlier comment as far as basically the value proposition of the principles we operate under, what we're most interested in doing and continuing to do is winning sockets.

Speaker 3

Yeah. Our customers particularly does not want us to reveal the lateral power or vertical power.

Speaker 6

Got it. That's helpful. Thank

Operator

you. This concludes our Q and A session. I would now like to turn the webinar back over to Bernie.

Speaker 1

I'd like to thank you all for joining us for this conference call. As a quick reminder, we will be hosting our Investor Day on 03/20/2025. Michael and other MPS executives will showcase our vision for innovation and outline key elements of the company's long term growth strategy. The event will be held at our San Jose offices and will include live presentations, a Q and A session and demos of our latest solutions for a number of applications and a lot of a number of other markets. If you haven't done so already, please email your RSVP to mpsinvestor, one word, dot relationsmonolithicpower dot com.

Speaker 1

You can also access a live stream of the event on our Investor Relations website. Separately, I look forward to talking to you again during our first quarter twenty twenty five conference call, which will likely be held in May. Thank you, and have a nice day.

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Earnings Conference Call
Monolithic Power Systems Q4 2024
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