Android Market Impact
Q: How is the shift in Android affecting your revenue outlook?
A: We expect fiscal '25 revenue to be down slightly compared to fiscal '24, by a few percentage points, due to a shift in Android 5G towards the entry-tier market. - This shift has impacted unit volumes and content per model, especially with our largest Android customer where revenue in their highest volume fall models is less than last year. - We're intentionally pivoting away from entry-tier areas that are more margin-compressed to focus on higher tiers and profitable mid-tier segments. - -

Gross Margin Outlook
Q: What is your long-term gross margin target amidst current headwinds?
A: Despite current headwinds, there's no change to our long-term gross margin guidance of 50% plus. - In fiscal '25, we expect margins in the mid-40% range, comparable to last year. - Near-term margins are impacted by mix shifts to entry-tier Android devices and underutilization charges, but structural changes like moving to 8-inch BAW and shifting capacity will help us reach our target. - - -

Pricing Discipline and Revenue Mix
Q: Are you changing your strategy in the entry-tier Android market?
A: Yes, we're exercising pricing discipline and have chosen not to compete in the entry-tier Android market due to compressed margins. - - This decision leads to a reduction of approximately $1 billion in TAM, but allows us to focus on profitable segments. - We're shifting resources to areas where we add the most value and can maintain healthier margins. - -

Strategic Shift and Diversification
Q: How are you adjusting your business strategy amid market changes?
A: We're reallocating R&D dollars to Defense & Aerospace (D&A), Power Management, and High Performance Analog (HPA). - Our D&A business is now larger than our China Android-based cellular business. - We're also investing in ultra-wideband, automotive, and maintaining our share in Wi-Fi within our Connectivity and Sensors Group (CSG), aiming for double-digit growth in both HPA and CSG this year. -

Long-Term Growth Expectations
Q: Has the Android market shift affected your long-term growth targets?
A: No, we're still confident in achieving a strong single-digit growth rate in our Mobile Products segment (ACG). - We believe we can grow this business even as the wider Android market declines. -

Seasonality Expectations
Q: What are your expectations for the upcoming March quarter?
A: For modeling purposes, we anticipate being down 5% to 10% sequentially in the March quarter, which aligns with typical seasonality. - While ACG may decline due to seasonal factors, we expect substantial growth in HPA and growth in CSG during this period. -

Operating Expense Reductions
Q: How are you managing operating expenses in light of revenue changes?
A: We've reduced OpEx to reflect changes in the Android business, focusing resources on the best investment areas. - This realignment ensures we're utilizing our resources efficiently and positioning ourselves for long-term profitability. -

Content Variation with Largest Customer
Q: Does your content vary across different models for your largest customer?
A: Yes, our content varies by model and SKU with our largest customer, affecting overall content levels based on product mix. - This variation is consistent with prior years and influences our revenue depending on the sales mix. -

Growth in SAW Filters
Q: Do you anticipate growth in SAW filter opportunities?
A: Yes, we're seeing growth in SAW filters, particularly with our next-generation LRT SAW technology performing well in mid-band and high-band spectrums. - This opens up opportunities across various frequency bands and is available to all customers, not just limited to Android devices. -

Exposure to Entry-Tier Android Market
Q: How significant is your exposure to the entry-tier Android market now?
A: Our revenue from China-based Android is now under $100 million and expected to trend lower in fiscal '26, reducing our exposure significantly. - - We've seen a 75% decline from the peak in China Android revenue and are focusing on more margin-accretive opportunities moving forward. - -