Ananda Baruah

Ananda Baruah asked if Western Digital anticipates an acceleration in its cost per exabyte reduction beyond the current 10% year-over-year, given the increasing mix of UltraSMR and the upcoming HAMR technology, which is expected to be margin-neutral to accretive. He also inquired about the maximum areal density achievable with CMR and UltraSMR before HAMR becomes fully operational.

Answer

CFO Kris Sennesael confirmed the current ~10% cost per terabyte reduction and stated that continued innovation, higher capacity drives, and increased UltraSMR adoption will drive further cost reductions, potentially accelerating if roadmaps advance. CEO Irving Tan deferred the question about maximum areal density for CMR and UltraSMR before HAMR to the upcoming Innovation Day.

Ananda Baruah asked if Western Digital's cost down per exabyte, currently around 10% year-over-year, could increase in coming years with the growing adoption of UltraSMR and the introduction of HAMR technology. He also inquired about the maximum areal density achievable with CMR and UltraSMR before HAMR becomes prevalent.

Answer

Kris Sennesael, CFO, confirmed the current ~10% cost per terabyte reduction and stated that continued innovation, higher capacity drives, and increased UltraSMR adoption will drive further cost reductions, potentially accelerating beyond 10%. Irving Tan, CEO, indicated that details regarding the maximum areal density for CMR and UltraSMR before HAMR's widespread adoption would be shared at the upcoming Innovation Day.

Ananda Baruah asked for a review of the company's areal density roadmap leading up to HAMR and for clarification on the 'platforms business' opportunity with native AI companies or 'neo clouds'.

Answer

CEO Irving Tan detailed the product roadmap, culminating in a 38TB CMR / 44TB Ultra SMR HAMR drive ramping in calendar 2027. He also confirmed the platforms business targets neo-clouds and storage-as-a-service providers that require storage infrastructure, seeing it as a growing opportunity as these companies scale.

Ananda Baruah of Loop Capital Markets asked about the potential for new data center architectures as different HDD technologies (ePMR vs. HAMR) are deployed. He also questioned if the March quarter's gross margin was held back by a product transition.

Answer

CEO Irving Tan acknowledged that new technologies like HAMR will require some architectural adjustments at the rack and software level, but noted that sophisticated customers are well-equipped to manage these changes. Interim CFO Don Bennett clarified that the ramp of the new 11-disk platform was actually faster and more efficient than expected, which positively impacted and improved gross margin above the original guidance.

Ananda Baruah asked for perspective on the role of flash storage in the hyperscale market, an area traditionally dominated by HDDs, especially in light of a competitor's recent public announcement of a hyperscale flash system win.

Answer

CEO David Goeckeler reiterated his consistent view that storage adoption is use-case driven. While new applications like AI model training are flash-intensive, the resulting data explosion will drive massive demand for cost-effective HDDs. He emphasized that AI is a powerful tailwind for both businesses, noting the record 161 exabytes of HDD capacity shipped to the cloud in the quarter as proof of its continued dominance.

Ananda Baruah asked for an update on Western Digital's conventional technology aerial density roadmap for HDDs leading up to the eventual transition to HAMR.

Answer

CEO David Goeckeler explained that the roadmap is constantly evolving, citing the new 11-platter drive as an example of pushing past previous perceived limits. He stated they have a clear path to drive their current ePMR and UltraSMR platform to 40 terabytes, which will bridge the gap until HAMR is expected to be introduced to carry the portfolio forward. He confirmed there is at least one more generation on the current platform before that transition.

Ananda Baruah from Loop Capital inquired about the recovery of orders post-government shutdown and sought clarification on the impact of rising memory prices on both the ITsavvy business and the traditional print/copier business, including whether the impacts are distinct.

Answer

Steven Bandrowczak, Chief Executive Officer, stated that Xerox is seeing an expanded total addressable market (TAM) in state, federal, and local government due to the ITsavvy and Lexmark acquisitions, leading to growth despite some slowdowns. Regarding memory prices, Mr. Bandrowczak noted industry-wide uncertainty in pricing and availability for both IT solutions and print. He explained that Xerox is helping IT solutions clients navigate this by extending product life, offering as-a-service models (HPE GreenLake, Dell APEX), and leveraging SaaS platforms. For the print business, the impact is expected to be minimal in the first half of the year due to existing product inventory, with potential larger impacts in the second half.

Ananda Baruah inquired about the recovery of orders post-government shutdown, the specific impact of rising memory prices on both the ITsavvy business and the print business, and the potential for price elasticity headwinds and margin impact from these increased costs.

Answer

Steven Bandrowczak (CEO) confirmed an expansion of the total addressable market (TAM) and growth opportunities in the government sector due to ITsavvy and Lexmark acquisitions. Regarding memory prices, he noted industry-wide uncertainty in pricing and availability, outlining strategies for IT solutions clients to navigate challenges by extending product life, adopting as-a-service models (HPE GreenLake, Dell APEX), and leveraging SaaS platforms. For the print business, he anticipated a modest impact in the first half of 2026, with potential for a larger impact in the second half, emphasizing proactive navigation with suppliers and clients.

Ananda Baruah of Loop Capital Markets LLC inquired about the Q2 demand slowdown, asking if it was driven by federal uncertainty and tariffs or broader pricing pressures. He also sought clarification on IT Savvy's growth contribution and its client penetration.

Answer

President and COO John Bruno clarified the softness occurred in April and May, with a June recovery, attributing it to funding pauses in federal/SLED environments and tariff uncertainty causing decision delays, not cancellations. CFO Mirlanda Gecaj and Bruno explained that while legacy IT solutions revenue declined slightly, strong gross billings and the inclusion of IT Savvy drove overall segment growth. Bruno confirmed IT Savvy penetration into the Xerox client base is still in the low single-digits, indicating a significant runway for growth.

Ananda Baruah asked for context on the macroeconomic environment, seeking details on communications from large corporate customers and VARs about SMBs, and requested further color on the successful integration of ITsavvy.

Answer

John Bruno, President and COO, stated that while the environment is volatile, Xerox did not see a real impact in Q1, and early trepidation from SMBs has eased. CEO Steven Bandrowczak added that spending is focused on productivity drivers like AI PC refreshes. Regarding ITsavvy, Bandrowczak highlighted a significant cross-sell opportunity, noting that penetrating just 5% of Xerox's print client base could double the IT Solutions business. He also pointed to an acceleration in pipeline and bookings, which Bruno attributed to a successful 'reverse' integration where Xerox's IT business was absorbed into ITsavvy's effective operational structure.

Ananda Baruah inquired about the operational model of the newly acquired ITsavvy, seeking clarity on its role as a VAR or systems integrator. He also asked about its potential for revenue amplification under Xerox's ownership.

Answer

CEO Steven Bandrowczak described ITsavvy as a Value-Added Reseller (VAR) with strong supplier relationships, capable of addressing over 90% of a CIO's budget by wrapping services around technologies like AI-enabled endpoints and cloud transitions. President and COO John Bruno emphasized the "value-added" aspect, noting ITsavvy's strong equipment margins and lifecycle management capabilities. Bandrowczak added that growth will come from leveraging Xerox's 200,000+ SMB clients and cross-selling print solutions into ITsavvy's customer base.

Ananda Baruah asked for specific details regarding the product launch delays and the lower-than-expected sales productivity, seeking to understand the root causes, the lessons learned, and whether macroeconomic factors contributed to the shortfalls.

Answer

CEO Steven Bandrowczak positioned the issues as part of a non-linear, multiyear reinvention journey. President and COO John Bruno elaborated that the product delay was a forecasting issue between older and newer products, while the sales productivity stall was an after-effect of a major Q1 reorganization, noting that activity levels have now stabilized. CFO Xavier Heiss added that underlying sequential revenue trends are improving. The executives collectively stated that the issues were primarily due to internal execution rather than macroeconomic pressures.

Ananda Baruah asked about the activity in the 'warm tier' of storage, specifically regarding hard drive and flash participation, and the perception that it might be becoming largely a NAND tier in a GenAI world.

Answer

CEO Dave Mosley cautioned against oversimplifying the 'warm tier,' explaining that data center tiering architectures are well-established based on economics and known architectures. He emphasized that hard drives are not just background storage but are working 24/7, optimized for streaming performance, not random small block workloads (which are more memory-dependent). He believes that for large data concepts like checkpoints, physical AI, and video, the architectural tier storing the vast majority of data will remain constant for the next decade.

Ananda Baruah inquired about activity in the 'warm tier' of storage, its growth, hard drive and flash participation, and whether it is increasingly becoming a NAND-centric tier in the context of GenAI.

Answer

CEO Dave Mosley cautioned against equating memory-dependent applications with big data storage, emphasizing that data center tiering architectures are well-established based on economics. He clarified that hard drives are actively used 24/7, optimized for streaming performance rather than random small block workloads, which are typically memory-based. He believes that for large data concepts like checkpoints, physical AI, and video, the architectural tier storing the vast majority of data will remain constant for the next decade.

Ananda Baruah asked about the velocity at which customers will mix up to higher capacity points, questioning if it will be faster than historical rates, especially post-HAMR normalization, and what the gating factors would be.

Answer

Seagate's Chair and CEO, Dave Mosley, noted an immense pull for 40TB and 50TB drives due to a superior TCO proposition, leading to a faster mix-up than with PMR products. He attributed this acceleration to exploding video content and human creativity.

Ananda Baruah asked about the future velocity of customer mix-up to higher capacity points, specifically if shortages and aerial density will accelerate this pace, and if a faster mix-up within HAMR could occur post-crossover, including any gating factors.

Answer

Dave Mosley, Chair and CEO, noted an "immense pull" for 40TB (and future 50TB) drives due to their superior TCO proposition, indicating faster customer adoption compared to older PMR products. He attributed this acceleration to the explosion of video properties and human creativity driving demand.

Ananda Baruah from Loop Capital Markets asked for more detail on the different types of AI-related video drivers and inquired if Seagate is seeing any demand from the autonomous vehicle sector.

Answer

CEO Dave Mosley identified three key drivers: large-scale video storage properties, unstructured video data processing, and emerging AI video generation applications. Regarding autonomous vehicles, he noted that while data is collected for training, a significant opportunity would only emerge if cars began to monetize that data, a trend he has not yet seen.

Ananda Baruah asked for a framework to understand storage consumption in a Gen AI data center compared to a traditional cloud data center and whether more drives are being deployed into existing facilities.

Answer

CEO Dave Mosley explained that it's difficult to quantify as it depends on which AI applications become dominant. He highlighted the architectural trend of disaggregated storage—decoupling compute and storage investments—as a more significant factor. This allows storage to scale independently and more efficiently, which he sees as a positive trend for HDD demand as data-intensive applications grow.

Ananda Baruah of Loop Capital Markets asked if HAMR margins are accretive from the start and questioned the pacing of the HAMR rollout, given the rich margins on existing high-capacity PMR drives.

Answer

CEO Dave Mosley stated that even with the high margins on the current 24/28TB platforms, HAMR technology is still accretive. He explained that HAMR not only provides a compelling value proposition at the highest capacities but also allows for margin uplift across the portfolio by refreshing lower-capacity drives with fewer components. CFO Gianluca Romano added that HAMR's profitability will become more visible as volumes ramp.

Ananda Baruah from Loop Capital asked about the process for increasing physical capacity if demand from GenAI and video outstrips the gains from HAMR transitions, inquiring about lead times and the component supply chain. He also asked if aerial density gains alone are sufficient for the foreseeable future.

Answer

CEO Dave Mosley explained that aerial density gains also help address demand in lower-capacity markets more efficiently. By using fewer components per drive at points like 20TB, those freed-up components can be used to make more drives, effectively increasing unit capacity. CFO Gianluca Romano added that the company's focus is on technology transition, not adding more units, as it's the most profitable path, and they will assess demand in future quarters against their supply plan.

Ananda Baruah asked if Logitech could achieve growth above its typical outperformance versus the PC market, given current PC market dynamics, and whether there was any pull-forward of sales due to anticipated component price increases, particularly for memory.

Answer

Hanneke Faber, CEO, acknowledged Logitech's historical ability to perform well in various environments, including when consumers might upgrade peripherals instead of PCs. Matteo Anversa, CFO, noted that Personal Workspace growth outpaced overall company growth in the recent quarter. Both Hanneke Faber and Matteo Anversa stated they did not observe any broad-based pull-forward sales, attributing video conferencing growth to execution and deal tracking rather than memory shortage concerns, and advised a longer-term perspective for the video conferencing business.

Ananda Baruah from Loop Capital Markets LLC inquired about the progress on harmonizing global product portfolios and sought to clarify the distinction between the two potential sources of market share pressure: inventory shortages during price negotiations and the subsequent consumer reaction to higher prices.

Answer

CEO Hanneke Faber confirmed the two share pressure dynamics are distinct. She stated that the first phase, related to inventory shortages during negotiations, is now over, and stock levels have recovered. However, the second phase, the impact of higher consumer prices on demand and share, is yet to be fully seen. On portfolio harmonization, she said the company is in a 'very good place,' with the 'China for China' program being the main source of differentiation, some of which may become global innovations.

Ananda Baruah asked if management was observing an improving spending environment in key categories. He also followed up on the investment strategy, asking if the company's approach to operating leverage might change in the future given the recent increase in OpEx.

Answer

CEO Hanneke Faber noted that the global consumer appears resilient, with positive market trends in the U.S. during Q2 and holiday forecasts aligning with their expectations. Regarding operating leverage, both Faber and CFO Matteo Anversa stated it was premature to discuss fiscal 2026. They reiterated a commitment to operating within the 24-26% OpEx-to-sales framework for the current fiscal year, emphasizing a disciplined approach while intentionally shifting spend to R&D and marketing to fuel long-term growth.

Ananda Baruah of Loop Capital Markets asked for an update on progress against key strategic opportunities, including geographic expansion, B2B growth, and the 'Work and Play' initiative. He also inquired about the company's view on the keyboard business benefiting from an AI-driven PC refresh cycle.

Answer

CEO Hanneke Faber detailed progress on strategic priorities, citing broad-based geographic growth, a 9% increase in the B2B segment driven by new products like MeetUp 2, and 'green shoots' in Work and Play expansion, such as over 20% growth in education. Regarding AI, Faber stated they are bullish on mice and keyboards, viewing a PC refresh as a positive tailwind and highlighting the Logi AI Prompt Builder's 5.5 million user interactions as an early success in linking hardware to large language models.

Ananda Baruah with Loop Capital inquired about any notable or emerging trends related to video and unstructured data within NetApp's customer base or proof of concepts, and whether customer demand aligns with the hard drive industry's shift towards higher density 20TB to 30TB drives.

Answer

CEO George Kurian highlighted that unstructured data is a key focus for customers, citing examples like a semiconductor manufacturer organizing millions of documents for efficiency and a content production house using AI for enriched digital experiences. He noted growing multimodal applications and video analytics. Regarding hard drives, he stated that customers generally seek aerial density improvements, and NetApp works with suppliers to qualify different media types and density points based on performance, cost, and density drivers.

Ananda Baruah inquired about notable trends in video and unstructured data over the last 90 days, particularly in customer use cases and proof of concepts. He also asked if hard drive makers' shift to 30 TB drives aligns with customer demand for aerial density improvements.

Answer

George Kurian (CEO) highlighted unstructured data as a key focus, citing a semiconductor manufacturer's use case for unifying millions of documents. He noted growing use of multimodal applications and video analytics, though not a dramatic inflection. He confirmed customers broadly seek aerial density improvements, with NetApp working with suppliers based on performance, cost, and density drivers.

Ananda Baruah of Loop Capital Markets LLC asked if recent wins in large-scale model training and AI-as-a-service represented a total addressable market (TAM) expansion. He also questioned if the emergence of reasoning agents was impacting the RAG pipeline.

Answer

CEO George Kurian confirmed that NetApp is leveraging its NVIDIA NCP certification to win deals with sovereign cloud providers for AI-as-a-service, viewing it as an opportunistic expansion beyond the core enterprise market. Regarding RAG, he explained that the primary customer challenge is data organization, where NetApp provides value. He also mentioned that NetApp is developing capabilities to make reasoning models more efficient, with more details to come at their user conference.

Ananda Baruah of Loop Capital Markets LLC asked if recent wins in large model training and AI-as-a-service represented a TAM expansion for NetApp. He also inquired if the emergence of reasoning agents was impacting the RAG pipeline.

Answer

CEO George Kurian explained that their NVIDIA NCP certification is enabling wins with sovereign cloud providers, leveraging NetApp's multi-tenancy strengths. While the primary focus remains the enterprise, they are opportunistic. On RAG, he noted that NetApp's data organization tools are key for clients and that new capabilities are being developed to make emerging reasoning models more efficient.

Ananda Baruah of Loop Capital Markets asked how the growth of GenAI in hyperscale environments, particularly with video, impacts the value of NetApp's software and its overall business there.

Answer

CEO George Kurian explained that NetApp's unique value lies in its ability to bring enterprise data to hyperscaler toolchains, citing a gaming company's hybrid AI development environment as a recent win. He noted that AI is driving significant data growth through vectorization and multimodal datasets, which is already visible in customer proofs of concept, indicating a strong future opportunity.

Ananda Baruah from Loop Capital Markets asked how the growth of GenAI in hyperscale environments, particularly with data-intensive applications like video, impacts the value proposition and business opportunity for NetApp's software.

Answer

CEO George Kurian explained that NetApp's unique value lies in its ability to bridge enterprise data to hyperscaler AI toolchains, citing a recent win with a gaming company as an example. He noted that AI drives significant data growth through vectorization and multimodal datasets. While it's still early, he sees clear evidence of this data growth in current customer proof-of-concepts, which amplifies the need for NetApp's data management solutions.

Ananda Baruah of Loop Capital Markets LLC asked how the growth of GenAI in hyperscale environments, particularly with compute-intensive applications like video, impacts the value of NetApp's software and its business there.

Answer

CEO George Kurian explained that NetApp holds a unique position in bringing enterprise data to hyperscaler AI toolchains, which is a growing customer need. He cited a gaming company win that chose NetApp for its hybrid on-prem and cloud capabilities for a global AI game development environment. He also noted that AI use cases, like data vectorization and multimodal datasets, are already showing clear indications of significant data growth in customer proofs-of-concept, which benefits NetApp's storage solutions.

Ananda Baruah asked if the Q3 results and Q4 outlook affect the company's long-term financial target of mid-to-high single-digit growth through 2027, and also requested an early outlook for fiscal 2026.

Answer

CFO Michael Berry reaffirmed the company's confidence in the long-term financial targets set at its Investor Day, stating that nothing from Q3 has changed that outlook. He cited strong product momentum and go-to-market changes as supportive of the goals but declined to provide specific fiscal 2026 guidance, deferring it to the next earnings call.

Ananda Baruah inquired about the importance of the new high-end ASA product and its role in new customer acquisition.

Answer

CEO George Kurian explained that the entire refreshed flash portfolio has been well-received. He clarified that while midrange products typically drive new logo acquisition, the high-end products are key for winning wallet share. The ASA line, as NetApp's first block-optimized product, represents entirely new wallet share for the company.

Ananda Baruah asked how data growth from Retrieval-Augmented Generation (RAG) contributes to the inferencing opportunity and how NetApp's capabilities compare to competitors, including emerging players.

Answer

CEO George Kurian explained that the data growth from RAG and vectorization is a key part of the inferencing opportunity. He expressed strong confidence in NetApp's competitive position, citing its long experience in AI, unique hybrid cloud pipelines, and foundational ONTAP technology. He asserted that NetApp and Dell, as the players with the largest installed bases, are 'super well positioned' for the GenAI market.

Ananda Baruah questioned whether the implied March and June quarter revenue figures, based on the December guidance and full-year outlook, suggest conservatism or a flattening of revenue, and if the current strength is expected to continue through the calendar year. He also asked if the December quarter represents the low watermark for gross margins in the fiscal year.

Answer

Charles Liang, Founder, President, and CEO, stated that the $36 billion full-year revenue guidance is a very conservative number, expressing excitement about the company's expanded global capacity and the potential for continued rapid growth, especially with DCBBS. David Weigand, CFO, confirmed that the December quarter is a fair assessment for the low watermark in gross margins due to the challenges of doubling revenues and scaling new technology.

Ananda Baruah from Loop Capital questioned the conservatism in Super Micro's implied March and June fiscal quarters, given the $10.5 billion December guidance and at least $36 billion full fiscal year outlook, asking if revenue flattening is expected. He also asked if the current strength is anticipated to continue through the balance of the calendar year, considering recent large new cloud deals. Finally, he sought clarification on whether the December quarter represents the low watermark for gross margins in the fiscal year.

Answer

Charles Liang, Founder, President, and CEO, expressed excitement about reaching over $10 billion quarterly revenue, noting that global capacity is now expanded and ready. He stated that the $36 billion full-year outlook is a 'very conservative number' and anticipates continued quick growth and market leadership, with DCBBS improving profitability. David Weigand, CFO, confirmed that the December quarter is a fair assessment for the low watermark in gross margins, attributing it to the challenge of doubling revenues in one quarter and scaling new technology, but did not provide forecasts beyond December.

Ananda Baruah sought clarification on whether elongated customer decision-making cycles, previously seen with new product introductions, are still a factor and asked for more context on the plan to expand its large-scale data center customer base.

Answer

CEO Charles Liang responded that Super Micro works closely with partners to bring new products like the B300 and GB300 to market quickly, and its DCBBS solution helps customers of all sizes. He also confirmed that with a stronger cash flow position, the company is now ready to support more large-scale data center customers.

Ananda Baruah asked if the Blackwell ramp implies sequential revenue growth for the September quarter and whether growth could reach the high orders of magnitude seen during the Hopper ramp. He also asked a technical question about the stacking and liquid cooling capabilities for HGX B200 systems.

Answer

CEO Charles Liang affirmed his hope and belief that the company could repeat the strong growth history seen with Hopper, starting from the June quarter and continuing into September and December. He emphasized that their second-generation DLC-2 liquid cooling solution is fully ready for Blackwell, offering superior performance in power savings, water usage, and noise reduction, and that they gained significant experience from shipping 4,000 DLC racks last year.

Ananda Baruah asked for guidance on gross margins for the upcoming June quarter and throughout the Blackwell product cycle, seeking to address investor concerns about potential margin pressure. He also requested clarification on the revenue trajectory implied by the $40 billion fiscal 2026 target, including quarterly run-rates and the role of GPUs versus custom ASICs.

Answer

CEO Charles Liang explained that margins are typically better on new products like Blackwell, especially with the growing adoption of liquid cooling, where he believes Super Micro holds a majority share and a competitive advantage. An unnamed executive emphasized focusing on operating margins, which they are driving above targets. CFO David Weigand added that Super Micro's first-to-market position with stable platforms, as seen with the H100, helps margins. Regarding the revenue guide, Liang reiterated that a 65% growth rate for fiscal 2026 is a conservative estimate based on historical performance and new technology opportunities.

Ananda Baruah asked if the company still expects gross margins to improve throughout the fiscal year as previously guided and requested an explanation of the company's access to capital going forward.

Answer

CFO David Weigand confirmed the company's long-term margin target remains intact despite a conservative Q2 guide. CEO Charles Liang added that new technology and total solutions will aid growth. Regarding capital, Weigand highlighted the $4 billion raised in the last year, which provides a strong working capital position, and stated they don't anticipate any issues accessing capital markets if needed.

Ananda Baruah inquired if the shift of hyperscale and AI workloads to NeoClouds necessitates MaxLinear broadening its relationship set to participate in these opportunities.

Answer

CEO Kishore Seendripu explained that generating revenue and winning confidence naturally leads to more dialogues and broadening relationships. He noted that initially, the focus is on narrowing and deepening conversations to prove oneself, especially in challenging data center markets that require significant upfront marketing and support.

Ananda Baruah asked a broader growth question, drawing parallels between MaxLinear's post-COVID growth pattern and the current situation, inquiring if there are meaningful differences in the business, supply chain, or inventory that would alter the growth trajectory this time. He also asked how the shift of hyperscale and AI workloads to NeoClouds necessitates MaxLinear broadening its relationship set to participate in this paradigm.

Answer

CEO Kishore Seendripu highlighted fundamental differences from the COVID era, noting that current growth is infrastructure-driven with brand new revenues, huge total addressable markets, and tiny current shares, unlike the broadband-driven growth of COVID. He stated that the inventory situation is now in balance, and the supply chain is dramatically different due to geopolitical issues, foundry dependencies, and entrenched advanced nodes, requiring more innovation to maintain margins. Regarding NeoClouds, Dr. Seendripu explained that generating revenue naturally leads to more dialogues and the ability to broaden relationships, as success builds confidence. He noted that entering new markets like data centers requires significant upfront investment in marketing and support before revenue generation.

Ananda Baruah questioned the source of expected 2026 PAM4 DSP revenue growth and whether MaxLinear's module-maker relationships position it for emerging neo-cloud and sovereign cloud opportunities.

Answer

CEO Kishore Seendripu clarified that 2026 growth will be driven by existing 800-gigabit Keystone products, with 1.6-terabit Rushmore ramping later. He affirmed that their position as a strong third supplier with module makers is advantageous for new cloud opportunities.

Ananda Baruah asked for confirmation that the order book shows no signs of macro-related impact or tariff-driven pull-forwards, and questioned if the positive demand sentiment extends to the data center business.

Answer

CEO Kishore Seendripu stated it was too soon for tariff news to cause order spikes and that their long lead times would prevent fulfilling such pull-ins anyway. CFO Steve Litchfield added that the booking strength is a multi-quarter recovery trend. Regarding the data center, Dr. Seendripu explained that MaxLinear's focus remains on qualifying its products and gaining share, so their execution plan is unchanged regardless of broader market dialogues.

Ananda Baruah sought clarification on the optical DSP run rate, asking if the company was on a 1 million unit per year run rate or if it would ship 1 million units total in 2024, implying a much higher exit rate. He also asked if the engagement with leading module makers included Chinese companies.

Answer

CEO Kishore Seendripu clarified that the company is exiting 2024 at a 1 million unit per year run rate, not a quarterly rate, though he expects to exceed that pace in 2025. He also confirmed that their engagement with top module makers is global and includes "everyone," implying Chinese manufacturers are included.

Ananda Baruah sought clarification on the 'apples-to-apples' revenue growth, asking if backing out hyperscale hardware and Penguin Edge implied a pro forma 20% growth for FY26. He also questioned if the implied growth for non-hyperscale HPC AI in FY26 could be derived from the guidance and asked about the specific end markets driving potential upside in the HPC AI business.

Answer

Nate Olmstead, SVP and CFO, confirmed that removing the 14% of FY25 revenue from Penguin Edge and hyperscale hardware would result in a calculated pro forma growth rate around 20% for FY26. He indicated that the guidance range for Advanced Computing largely reflects opportunities in the HPC AI space for non-hyperscale customers. Mark Adams, President and CEO, identified financial, federal (government and integrators), education, and sovereign cloud as the primary near-term market opportunities driving a successful FY26, with new CRO Tony Fry also targeting healthcare.

Ananda Baruah sought clarification on the "apples-to-apples" revenue growth rate for fiscal 2026, after accounting for the 14% headwind from hyperscale hardware and Penguin Edge, implying a 20% pro forma growth. He also asked if the implied growth for the non-hyperscale HPC AI business in FY2026 could be backed out from the provided guidance and what specific end markets or aspects of the HPC AI business would drive the potential upside reflected in the wider Advanced Computing range.

Answer

Nate Olmstead, SVP and CFO, confirmed that removing the 14% revenue from FY2025 (from Penguin Edge and hyperscale hardware) would result in a calculated growth rate around 20% for FY2026 on an "apples-to-apples" basis. Regarding the non-hyperscale HPC AI growth, Nate Olmstead stated that while a range could be estimated, the guidance primarily reflects opportunities in that space, with the wider Advanced Computing range due to pipeline visibility rather than confirmed bookings. Mark Adams, President and CEO, identified financial, federal (government and integrators), education, and sovereign cloud sectors as the primary drivers for a successful FY2026, with new CRO Tony Frey also targeting healthcare and other verticals.

Ananda Baruah asked about the company's view on the ideal long-term mix between modules and components, and also inquired about the potential revenue materiality of the OCS product line.

Answer

President and CEO Michael Hurlston responded that the focus is on profitable growth, not a specific mix, and that they will be selective with lower-margin module opportunities. CFO Wajid Ali suggested modules could be 15-20% of revenue at the $600 million level. Regarding OCS, Hurlston reiterated his belief that it will become a multi-hundred-million-dollar business for Lumentum.

Ananda Baruah asked for the expected timeframe for the new cloud customer to reach a run rate and how Lumentum plans to balance allocating EML chips between external sales and internal use for its own transceivers, particularly in calendar year 2026.

Answer

President and CEO Alan Lowe projected that the first new customer would reach its run rate by the end of the calendar year, while the second would ramp much faster, hitting its stride in the fall. Regarding EML allocation, he explained there is no conflict in 2025 as Lumentum's own transceivers are primarily silicon photonics-based. For 2026, the strategy is to continue growing external supply while using newly added incremental capacity for internal needs, ensuring they do not reduce shipments to merchant customers.

Ananda Baruah of Loop Capital Markets inquired about Lumentum's strategic positioning regarding potential tariffs and whether the company has pricing power for its constrained EML lasers.

Answer

President and CEO Alan Lowe emphasized that the strategy to manufacture outside of China (in Thailand, with chips from the US, UK, and Japan) is independent of politics and positions the company well against tariff risks. He confirmed that due to constrained supply and the need to fund capacity expansion, Lumentum has implemented strategic price optimization for its EML products.

Ananda Baruah from Loop Capital Markets requested clarification on AI-related sales, specifically the context for GPU deals in APAC and North America and the types of customers purchasing these solutions.

Answer

CEO Paul Bay clarified that the company capitalized on large, opportunistic GPU deals in both North America and Asia Pacific. These GPUs are being integrated into server, storage, and networking solutions, which all saw double-digit growth. He noted that the direct customers are Ingram Micro's mid-market and enterprise solution providers (VARs), who then service various end markets.

Ananda Baruah asked for a big-picture framework to measure the progress and potential of the Xvantage platform, and questioned if the high gross profit contribution from Cloud signals a fundamental repurposing of the company's business model.

Answer

CEO Paul Bay outlined three ways they measure Xvantage's success: user engagement (12 million advanced searches), financial/operational impact (tripled self-service orders), and customer acquisition (reactivating thousands of dormant customers). He highlighted that Xvantage is built on the foundation of their $600 million cloud investment and will eventually become synonymous with the company itself, enabling a single-pane-of-glass experience for hardware, software, services, and cloud, ultimately driving differentiation and shareholder return.

Ananda Baruah of Loop Capital Markets asked for context on the cloud services business, including areas of high customer interest and what aspects of the business management finds most exciting for the future.

Answer

CEO Paul Bay highlighted that the company manages over 52 million seats on its cloud platform, which served as the foundation for the Xvantage digital experience platform. He expressed excitement about creating a 'single pane of glass' experience through Xvantage, integrating hardware, software, and cloud transactions. He also mentioned a new collaboration with AWS as part of a broader strategy to integrate with hyperscalers and help partners deliver complete business outcomes.

Asked for clarification on the timeline and process for gaining visibility into production volumes from smartphone OEMs and whether becoming a 'valid supplier' across multiple SKUs by next spring is a reasonable expectation.

Answer

The process involves a multi-month qualification cycle, starting with one product SKU and then expanding. The suggested timeline is reasonable. Once qualified with a customer, expansion to more SKUs and models is expected, with the main variable being the time required to produce new battery dimensions if needed.

Ananda Baruah asked for details on the capabilities of the EX-2M and EX-3M battery models, their expected market entry timing, and potential volumes. He also sought clarification on manufacturing line capacity and the strategy for adding new lines.

Answer

CEO Raj Talluri described the product evolution, with EX-2M offering higher energy density from new materials and EX-3M providing further architectural advances, but stated it was too early to forecast volumes. COO Ajay Marathe explained that Line 1 is a 'universal line' with a capacity of 9.5-10 million units annually. He added that future lines will be optimized for cost and speed, with long-lead-time items being stockpiled with suppliers to accelerate deployment as customer demand solidifies.

Inquired about the capabilities and market timing for the EX-2M and EX-3M battery models, their potential volume contribution, and sought clarification on the manufacturing capacity and expansion plans for the four production lines.

Answer

EX-1M, EX-2M, and EX-3M represent successive improvements in materials and architecture for higher energy density. It's too early to comment on specific volumes. Line 1 is a flexible 'universal line' with a capacity of 9.5-10 million batteries annually. Future lines (2-4) will be ordered based on customer qualification progress and will be optimized for cost and speed for specific cell sizes, with learnings applied back to Line 1.

Ananda Baruah asked for clarification on the new smartphone OEM agreement, questioning if the announced volume customer for late 2025 is a new or existing relationship. He also inquired which battery models, EX-1M or EX-2M, are slated for volume production next year.

Answer

CEO Raj Talluri confirmed the agreement is with a new smartphone OEM, with a commitment to launch in 2025 upon successful qualification. He explained that the EX-1M is currently being sampled and refined based on customer feedback, while the next-generation EX-2M will begin sampling in Q4 with a goal to accelerate it into production.

Ananda Baruah of Loop Capital Markets LLC asked for clarity on the timeline for gaining visibility into production volumes from smartphone OEMs and whether Enovix could become a 'valid supplier' across multiple SKUs by next spring.

Answer

CEO Raj Talluri detailed the multi-month qualification process, which involves sampling, customer testing, and then a gradual ramp-up starting with a single product SKU before expanding. He confirmed that becoming a valid supplier for multiple SKUs by next year is a reasonable way to think about the progression, noting the process will accelerate after the first successful qualification.

Ananda Baruah asked for context on Enovix's broadening engagement across verticals like IoT, auto, and power tools, and questioned if this creates a revenue bridge before the smartphone ramp. He also sought clarification on which customers would be visiting the new Malaysia facility.

Answer

CEO Raj Talluri explained that mastering the difficult smartphone battery market allows Enovix to apply its technology to other, less stringent markets, creating new opportunities. CFO Farhan Ahmad confirmed that IoT growth could serve as an additional revenue vector. Regarding the facility visit, Raj Talluri confirmed many customers, including smartphone and cloud OEMs, were scheduled to visit the new Malaysia factory but could not disclose specific attendees or their exact timing.

Ananda Baruah sought clarification on Hyve's growth metrics, the impact of complex hyperscaler engagements on margins, and the source of networking improvement. He also followed up on whether 'Made in America' trends are driving more conversations with hyperscalers.

Answer

CFO Marshall Witt clarified that the difference between Hyve's total growth and its 45% ODM/CM growth was due to a year-over-year decline in its supply chain business. CEO Patrick Zammit confirmed the strategy is to move up the value chain with ODM and SMT investments, which is stabilizing margins. He noted that while Hyve had a strong networking quarter, the distribution business also returned to growth, and confirmed interest from new customers due to Hyve's expertise and manufacturing capabilities.

Ananda Baruah of Loop Capital questioned if the Hyve softness was part of a broader industry dynamic where hyperscalers and other customers over-bought server components, leading to excess inventory.

Answer

CFO Marshall Witt addressed this by stating that nearly all inventory purchased for Hyve customers is to fulfill their specific demand forecasts. He emphasized that TD SYNNEX has full protection to recover carrying costs and faces no obsolescence risk, insulating the company from potential customer inventory buildups.

Ananda Baruah asked if it is reasonable to anticipate higher peaks in AI systems revenue and backlog during the Blackwell cycle, similar to what was observed during the Hopper cycle.

Answer

CEO Antonio Neri acknowledged the potential but emphasized the lumpy nature of the business, driven by large service provider deals that take months to convert from order to revenue. He noted that while large deals in the pipeline are now mostly for Blackwell systems, the next-generation GPUs will not be available at scale until late 2025 or early 2026, affecting the timing.

Ananda Baruah asked about the expected mix of GenAI server revenue in fiscal 2025, specifically the split between GreenLake subscription-based sales and traditional CapEx purchases.

Answer

CEO Antonio Neri explained that enterprise AI deals typically include a GreenLake component, where the software is sold as a subscription on the platform attached to a CapEx infrastructure sale. In contrast, recent deals with large service providers and model builders have been straight CapEx purchases. This results in a mix of CapEx-only deals and hybrid CapEx-plus-subscription deals.

Ananda Baruah of Loop Capital Markets asked about HPE's current "sweet spot" in the generative AI market, including the types of deployments and workloads it is targeting, and how this strategy might evolve over the next two years.

Answer

CEO Antonio Neri identified HPE's sweet spot as its expertise in building and running large, complex liquid-cooled AI systems. For the enterprise, he emphasized simplicity and security delivered via the HPE GreenLake platform. He noted the future strategy involves integrating Juniper's networking to offer a full, hybrid AI stack from networking and compute to software and services.

Ananda Baruah from Loop Capital Markets asked about the customer conversations supporting the reiterated 2025 guidance amidst macro uncertainty, and also inquired about Stratasys's involvement in the broader GenAI and factory automation ecosystem.

Answer

CEO Yoav Zeif described a dual environment of high customer engagement for additive solutions despite capital spending constraints, reinforcing their strategy to focus on profitability and be ready for a market rebound. He enthusiastically confirmed active involvement in AI, noting that additive manufacturing is a digital solution ideal for robotics and automation. He highlighted a dedicated AI unit, leveraging the Riven acquisition for AI-based part correction, and collaboration with their Customer Advisory Board (including Boeing, Toyota, GM) to align on AI-driven innovations.

Ananda Baruah asked a strategic question about the potential impact of AI factories and Gen AI-driven automation on Stratasys's production business.

Answer

CEO Yoav Zeif called AI 'essential' to Stratasys's future, citing the acquisition of Riven for AI-based part correction and development of features like predictive maintenance via the new GrabCAD IoT platform. He positioned additive manufacturing as a critical tool for the broader transition to digital manufacturing, stating that AI-centric production systems will be a strong tailwind for the industry.

Ananda Baruah asked about the durability of the traditional server refresh cycle and the mechanics of increasing the storage attach rate to GenAI server sales.

Answer

COO and Vice Chairman Jeffrey Clarke stated that the server refresh dynamic, driven by data center consolidation for power and space efficiency, is expected to continue for another four quarters. Regarding storage attach, he explained that AI's need for data creates opportunities for hot/warm storage and parallel file systems. Dell is addressing this with its leading unstructured data platform (PowerScale), its upcoming 'Project Lightning' parallel file system, and by incentivizing its sales force to attach storage to AI deals.

Ananda Baruah asked about the baseline business outlook for 2025 given the recent performance of the Industrial and Healthcare segments, and also inquired about the potential impact of tariffs.

Answer

CEO Jeffrey Graves expressed optimism for 2025, citing positive trends in printer and consumable demand, strong interest in new industrial applications, and steady growth in healthcare. He believes these factors, combined with cost management opportunities, position the company for a better year. Regarding tariffs, particularly on Chinese metal printers, he noted that they, along with a focus on defense and onshoring, could be a positive for a U.S.-based company like 3D Systems.

Ananda Baruah from Loop Capital Markets asked for a breakdown of the expected Print market decline between commercial and consumer segments, and what underlying dynamics are driving the commercial outlook.

Answer

CEO Enrique Lores detailed the segment expectations for FY25. He anticipates the consumer print market will continue to decline. In the office segment, he distinguished between the transactional market (expected to decline) and the contractual/Managed Print Services market (expected to perform better), identifying the latter as a key focus area for HP due to its lower relative share. He also noted that the industrial space is expected to continue growing.

Ananda Baruah of Loop Capital Markets asked for a long-term perspective on Cirrus Logic's smartphone business, questioning whether future growth would be driven more by content increases or by unit volume growth.

Answer

CEO John Forsyth explained that Cirrus Logic's strategy is to be positioned for growth even if smartphone unit volumes are flat. He emphasized that the company sees significant long-term opportunities for growth through both incremental additions to existing sockets and by capturing new sockets in areas like camera and power. He stated that R&D investments are targeted at these areas to deliver better solutions and leverage the company's execution capabilities.

Ananda Baruah inquired about the source and resolution of supply chain constraints, whether the company is actively seeking a new CFO, and if the retirement of the [AO] product series was a planned decision.

Answer

CEO Richard Knaley explained that the supply chain constraints were a market-wide issue affecting scanner and peripheral components, which are now abating due to alternative sourcing and reduced lead times. He confirmed that NUBURU is actively searching for a new CFO to allow him to focus on the CEO role. Knaley also stated that the [AO] series was intentionally sunsetted as part of a planned transition to the newer BL-250 and 1-kilowatt systems.

Ananda Baruah inquired about the source and resolution of the supply chain constraints that impacted Q3 results. He also asked for clarification on the company's search for a new CFO and whether the retirement of the AO series laser was a planned event.

Answer

CEO Richard Knaley confirmed that the supply chain constraints were related to market-wide shortages of scanner and peripheral components, which are now abating due to alternative sourcing initiatives. Knaley also stated that the company is actively searching for a new CFO and that the AO series was retired as part of a planned product transition to the newer BL series.

Ananda Baruah inquired about the source and resolution of supply chain constraints, whether they were market-wide, the company's plan for the CFO position, and if the retirement of the AO series was a planned event.

Answer

CEO Richard Knaley explained that the supply chain constraints on scanner components were market-wide and are now abating due to alternative sourcing and reduced lead times. He also confirmed that NUBURU is actively searching for a new CFO and that the AO series retirement was planned to coincide with the launch of the new BL series.

Ananda Baruah of Loop Capital Markets inquired about the source and resolution of Q3 supply chain constraints, the company's search for a permanent CFO, and whether the retirement of the AO series product line was a planned decision.

Answer

CEO Richard Knaley explained that the supply chain issues stemmed from market-wide constraints on scanner and related peripheral components, which are now abating due to alternative sourcing. He confirmed that NUBURU is actively searching for a new CFO to fill his former role. Knaley also stated that the sunsetting of the AO series was a planned transition to focus on the newer BL series products.

Ananda Baruah asked for clarification on the source of the supply chain constraints mentioned, whether they were market-wide or company-specific, the status of the search for a new CFO, and if the retirement of the AO series was a planned event.

Answer

CEO Richard Knaley explained that the constraints were related to scanner and peripheral components for the BL product line and were a market-wide issue, not specific to NUBURU. He confirmed the company is actively searching for a new CFO to allow him to focus on the CEO role. Knaley also stated that the retirement of the AO series was a planned sunsetting to coincide with the launch of the newer BL series products.

Ananda Baruah of Loop Capital Markets inquired about the nature of the increased interest from blue-chip customers beyond NASA and asked for any notable upcoming technical milestones for the BL-1000 product.

Answer

Executive Mark Zediker explained that NUBURU is engaging with a range of government and commercial customers, using its application center to validate the performance of the new BL-250 and BL-1000 products. He noted they are verifying the BL-1000's capabilities for battery manufacturing and expect to release technical papers on the results. Additionally, the BL-250 is being validated for use with scanners in applications like soldering and welding for electronics and medical manufacturing.

Ananda Baruah of Loop Capital Markets inquired about the expected cadence for the company's annual guidance and sought context on the Department of Defense (DoD) multi-party award contract, specifically the $75 million ceiling.

Answer

CFO Richard Knaley stated that guidance will be reviewed and updated quarterly, reiterating the current full-year 2023 outlook. Executive Mark Zediker explained the DoD contract is a multi-company award where NUBURU will receive requests for bids, and the $75 million ceiling is the total value across all seven contractors. Zediker also noted progress on a separate Air Force contract, with updates to follow.