Question · Q3 2026
Sean O'Loughlin asked about the 'meaningful contribution' from Linear Pluggable Optics (LPO) in Q4, its deployment dynamics (project-specific vs. gradual), and the Q4 gross margin mix shift within IoT. He also questioned potential headwinds from foundry CapEx in silicon photonics and silicon germanium.
Answer
CEO Hong Hou stated that LPO is expected to provide a meaningful mid-single-digit contribution in Q4, with the majority of data center growth coming from FiberEdge. He noted LPO's gradual adoption dynamic and its opportunity to increase Semtech's Total Addressable Market (TAM) by 150% by offering drivers in addition to TIAs. CFO Mark Lin clarified that semiconductor gross margins are healthy and accretive, while IoT systems and connectivity (ISC) gross margins are lower due to growth in cellular modules. Hong Hou addressed foundry capacity, mentioning efforts to qualify manufacturing from other sites for silicon germanium to ensure availability and robustness.
Ask follow-up questions
Fintool can predict
SMTC's earnings beat/miss a week before the call