Allegro MicroSystems(ALGM) - 2024 Q2 - Quarterly Report

FORM 10-Q This is Allegro MicroSystems, Inc.'s Quarterly Report on Form 10-Q for the period ended September 29, 2023. - Filing Type: Quarterly Report on Form 10-Q for the period ended September 29, 2023[1] - Registrant: ALLEGRO MICROSYSTEMS, INC. (ALGM)[2][3] - Filer Status: Large accelerated filer[3] Forward-Looking Statements This section cautions that forward-looking statements are subject to risks, with no public update planned. - Report contains forward-looking statements subject to known and unknown risks, uncertainties, and other important factors that may cause actual results to differ materially[5][6] - Forward-looking statements are based on management's beliefs and assumptions, which may or may not prove to be correct[6] - The company does not plan to publicly update or revise any forward-looking statements, except as required by applicable law[6] PART I. Financial Information Part I includes unaudited condensed consolidated financial statements, management's discussion, market risk, and controls. Item 1. Condensed Consolidated Financial Statements This item presents Allegro MicroSystems' unaudited condensed consolidated financial statements and notes for the specified periods. Condensed Consolidated Balance Sheets | Metric | Sep 29, 2023 | Mar 31, 2023 | Change | % Change | | :------------------------------------- | :----------- | :----------- | :----- | :------- | | Total Assets | $1,284,937 | $1,181,155 | $103,782 | 8.8% | | Total Liabilities | $186,649 | $214,340 | $(27,691) | -12.9% | | Total Stockholders' Equity | $1,098,288 | $966,815 | $131,473 | 13.6% | | Cash and Cash Equivalents | $370,013 | $351,576 | $18,437 | 5.2% | | Inventories | $173,089 | $151,301 | $21,788 | 14.4% | | Property, Plant and Equipment, net | $312,047 | $263,099 | $48,948 | 18.6% | | Current Liabilities | $134,241 | $165,325 | $(31,084) | -18.8% | Condensed Consolidated Statements of Operations | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :---------------------------------------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Total Net Sales | $275,509 | $237,666 | $37,843 | 15.9% | $553,802 | $455,419 | $98,383 | 21.6% | | Gross Profit | $159,503 | $132,022 | $27,481 | 20.8% | $317,453 | $250,396 | $67,057 | 26.8% | | Operating Income | $72,915 | $59,838 | $13,077 | 21.9% | $143,661 | $74,575 | $69,086 | 92.6% | | Net Income attributable to Allegro MicroSystems, Inc. | $65,617 | $50,614 | $15,003 | 29.6% | $126,467 | $60,861 | $65,606 | 107.8% | | Diluted EPS | $0.34 | $0.26 | $0.08 | 30.8% | $0.65 | $0.32 | $0.33 | 103.1% | Condensed Consolidated Statements of Comprehensive Income | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :------------------------------------------------ | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Net income attributable to Allegro MicroSystems, Inc. | $65,617 | $50,614 | $15,003 | 29.6% | $126,467 | $60,861 | $65,606 | 107.8% | | Foreign currency translation adjustment, net of tax | $(4,348) | $(7,899) | $3,551 | -44.9% | $(4,806) | $(14,717) | $9,911 | -67.3% | | Comprehensive income attributable to Allegro MicroSystems, Inc. | $61,306 | $42,784 | $18,522 | 43.3% | $121,742 | $46,281 | $75,461 | 163.0% | Condensed Consolidated Statements of Changes in Equity | Metric | Sep 29, 2023 | Mar 31, 2023 | Change | % Change | | :------------------------------------------ | :----------- | :----------- | :----- | :------- | | Total Stockholders' Equity | $1,098,288 | $966,815 | $131,473 | 13.6% | | Common Stock Shares Outstanding | 192,469,731 | 191,754,292 | 715,439 | 0.4% | | Additional Paid-In Capital | $683,891 | $674,179 | $9,712 | 1.4% | | Retained Earnings | $436,782 | $310,315 | $126,467 | 40.7% | | Accumulated Other Comprehensive Loss | $(25,509) | $(20,784) | $(4,725) | 22.7% | Condensed Consolidated Statements of Cash Flows | Metric | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :--------------------------------------------------------- | :-------------------------- | :-------------------------- | :----- | :------- | | Net cash provided by operating activities | $96,393 | $91,804 | $4,589 | 5.0% | | Net cash used in investing activities | $(59,926) | $(54,948) | $(4,978) | 9.1% | | Net cash used in financing activities | $(15,767) | $(14,596) | $(1,171) | 8.0% | | Net increase in cash and cash equivalents and restricted cash | $19,726 | $13,483 | $6,243 | 46.3% | Notes to Unaudited Condensed Consolidated Financial Statements This section provides detailed disclosures and explanations for the unaudited condensed consolidated financial statements. 1. Nature of the Business and Basis of Presentation - Allegro MicroSystems, Inc. is a leading global designer, developer, fabless manufacturer, and marketer of sensing and power solutions for the automotive and industrial markets[29] - The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP and include all necessary adjustments for fair presentation[29] - The second quarter of fiscal 2024 ended September 29, 2023 (13-week period), and the second quarter of fiscal 2023 ended September 23, 2022 (13-week period)[30] 2. Summary of Significant Accounting Policies - Financial statements require management to make estimates and assumptions that affect reported amounts, and actual results could differ materially[31] - As of September 29, 2023, two customers accounted for 26.2% of the Company's outstanding trade accounts receivable, net[33] - The adoption of ASU No. 2022-06, Reference Rate Reform, did not have a material impact on the Company's financial position, results of operations, cash flows, or related disclosures[36] 3. Revenue from Contracts with Customers | Application | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :---------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Automotive | $205,936 | $157,398 | $48,538 | 30.8% | $395,634 | $307,047 | $88,587 | 28.9% | | Industrial | $51,114 | $48,176 | $2,938 | 6.1% | $119,298 | $88,316 | $30,982 | 35.1% | | Other | $18,459 | $32,092 | $(13,633) | -42.5% | $38,870 | $60,056 | $(21,186) | -35.3% | | Total Net Sales | $275,509 | $237,666 | $37,843 | 15.9% | $553,802 | $455,419 | $98,383 | 21.6% | | Product | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :------------------------ | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Power integrated circuits | $99,737 | $97,327 | $2,410 | 2.5% | $203,725 | $177,987 | $25,738 | 14.5% | | Magnetic sensors | $175,772 | $140,339 | $35,433 | 25.2% | $350,077 | $277,432 | $72,645 | 26.2% | | Total Net Sales | $275,509 | $237,666 | $37,843 | 15.9% | $553,802 | $455,419 | $98,383 | 21.6% | | Geography | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :---------------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | United States | $47,724 | $25,131 | $22,593 | 89.9% | $96,548 | $53,522 | $43,026 | 80.4% | | Other Americas | $9,539 | $7,244 | $2,295 | 31.7% | $18,047 | $13,731 | $4,316 | 31.4% | | Europe | $46,951 | $40,710 | $6,241 | 15.3% | $102,339 | $76,043 | $26,296 | 34.6% | | Japan | $47,275 | $45,026 | $2,249 | 5.0% | $88,855 | $86,735 | $2,120 | 2.4% | | Greater China | $69,463 | $63,203 | $6,260 | 9.9% | $131,679 | $118,319 | $13,360 | 11.3% | | South Korea | $29,054 | $20,931 | $8,123 | 38.8% | $58,567 | $41,910 | $16,657 | 39.7% | | Other Asia | $25,503 | $35,421 | $(9,918) | -28.0% | $57,767 | $65,159 | $(7,392) | -11.3% | 4. Fair Value Measurements | Asset Type | Sep 29, 2023 (Level 1) | Mar 31, 2023 (Level 1) | | :------------------------- | :--------------------- | :--------------------- | | Money market fund deposits (Cash equivalents) | $105,012 | $102,019 | | Money market fund deposits (Restricted cash) | $8,418 | $7,129 | | Investments in marketable securities (Other assets) | — | $19,929 | | Total Assets | $113,430 | $129,077 | - No transfers among Level 1, Level 2, and Level 3 assets or liabilities occurred during the six-month periods ended September 29, 2023, and September 23, 2022[46] 5. Trade Accounts Receivable, net | Metric | Sep 29, 2023 | Mar 31, 2023 | Change | % Change | | :------------------------------------------------ | :----------- | :----------- | :----- | :------- | | Gross trade accounts receivable | $154,867 | $150,914 | $3,953 | 2.6% | | Less: Provision for expected credit losses | $(88) | $(102) | $14 | -13.7% | | Less: Provision for returns and sales allowances | $(35,257) | $(26,269) | $(8,988) | 34.2% | | Less: Related party trade accounts receivable allowances | $(575) | $(13,253) | $12,678 | -95.7% | | Total Trade Accounts Receivable, net | $118,947 | $111,290 | $7,657 | 6.9% | | Description | Expected Credit Losses (Sep 29, 2023) | Returns and Sales Allowances (Sep 29, 2023) | Total (Sep 29, 2023) | Expected Credit Losses (Sep 23, 2022) | Returns and Sales Allowances (Sep 23, 2022) | Total (Sep 23, 2022) | | :------------------------------ | :------------------------------------ | :------------------------------------------ | :------------------- | :------------------------------------ | :------------------------------------------ | :------------------- | | Balance at March 31, 2023 / March 25, 2022 | $102 | $26,269 | $26,371 | $105 | $14,819 | $14,924 | | Provisions | $(14) | $90,373 | $90,359 | $84 | $52,630 | $52,714 | | Deductions | — | $(81,385) | $(81,385) | — | $(47,884) | $(47,884) | | Balance at September 29, 2023 / September 23, 2022 | $88 | $35,257 | $35,345 | $189 | $19,565 | $19,754 | 6. Inventories | Category | Sep 29, 2023 | Mar 31, 2023 | Change | % Change | | :----------------------- | :----------- | :----------- | :----- | :------- | | Raw materials and supplies | $12,276 | $15,049 | $(2,773) | -18.4% | | Work in process | $114,766 | $98,836 | $15,930 | 16.1% | | Finished goods | $46,047 | $37,416 | $8,631 | 23.1% | | Total Inventories | $173,089 | $151,301 | $21,788 | 14.4% | - Inventory provisions totaled $4.36 million for the three-month period and $9.44 million for the six-month period ended September 29, 2023, compared to $2.95 million and $5.06 million for the respective prior-year periods[53] 7. Property, Plant and Equipment, net | Category | Sep 29, 2023 | Mar 31, 2023 | Change | % Change | | :------------------------------------ | :----------- | :----------- | :----- | :------- | | Land | $20,137 | $15,384 | $4,753 | 30.9% | | Buildings, building improvements and leasehold improvements | $61,028 | $61,500 | $(472) | -0.8% | | Machinery and equipment | $657,734 | $611,459 | $46,275 | 7.6% | | Office equipment | $6,463 | $6,119 | $344 | 5.6% | | Construction in progress | $55,242 | $48,378 | $6,864 | 14.2% | | Total Gross | $800,604 | $742,840 | $57,764 | 7.8% | | Less accumulated depreciation | $(488,557) | $(479,741) | $(8,816) | 1.8% | | Total Net | $312,047 | $263,099 | $48,948 | 18.6% | - Total depreciation expense amounted to $13.59 million for the three-month period and $26.35 million for the six-month period ended September 29, 2023, an increase from $10.98 million and $21.83 million in the prior-year periods, respectively[55] 8. Goodwill and Intangible Assets | Metric | Sep 29, 2023 | Mar 31, 2023 | Change | % Change | | :-------------------------- | :----------- | :----------- | :----- | :------- | | Balance at Period End | $27,707 | $27,691 | $16 | 0.1% | | Description | Sep 29, 2023 Net Carrying Amount | Mar 31, 2023 Net Carrying Amount | Change | % Change | Weighted-Average Lives (Sep 29, 2023) | | :------------------------------------- | :------------------------------- | :------------------------------- | :----- | :------- | :------------------------------------ | | Patents | $22,444 | $21,878 | $566 | 2.6% | 4 years | | Customer relationships | $141 | $166 | $(25) | -15.1% | 3 years | | Process technology | $24,329 | $25,545 | $(1,216) | -4.8% | 10 years | | Indefinite-lived and legacy process technology | $4,689 | $4,696 | $(7) | -0.1% | N/A | | Trademarks and other | $74 | $93 | $(19) | -20.4% | 2 years | | Total | $51,677 | $52,378 | $(701) | -1.3% | | - Intangible assets amortization expense was $1.51 million for the three-month period and $3.01 million for the six-month period ended September 29, 2023, an increase from $1.19 million and $2.23 million for the respective prior-year periods[60] 9. Debt and Other Borrowings - On October 31, 2023, the Company entered into a new $250.00 million Term Loan maturing in 2030, which refinanced the outstanding balance of the previous Term Loan Facility and partially financed the Crocus acquisition[64] - The new Term Loan amortizes at 1.00% per annum, with an initial margin of 2.75% for SOFR-based loans and 1.75% for base rate loans[64] - A new $224.00 million 2023 Revolving Credit Facility was established on June 21, 2023, replacing the 2020 facility, with no outstanding borrowings as of September 29, 2023[62][65] 10. Commitments and Contingencies - The Company is subject to various legal proceedings but does not believe any current matters could have a material adverse effect on its financial position, results of operations, or cash flows[66] - Accruals for legal contingencies are recorded when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated[66] 11. Net Income per Share | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :------------------------------------ | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Basic EPS | $0.34 | $0.26 | $0.08 | 30.8% | $0.66 | $0.32 | $0.34 | 106.3% | | Diluted EPS | $0.34 | $0.26 | $0.08 | 30.8% | $0.65 | $0.32 | $0.33 | 103.1% | | Basic Weighted Average Shares Outstanding | 192,431,094 | 191,284,631 | 1,146,463 | 0.6% | 192,214,210 | 190,959,616 | 1,254,594 | 0.7% | | Diluted Weighted Average Shares Outstanding | 195,100,855 | 192,639,576 | 2,461,279 | 1.3% | 195,055,495 | 192,654,097 | 2,401,398 | 1.2% | - Certain contingently issuable shares under RSUs (22,706) and PSUs (3,695) were excluded from the three-month diluted EPS computation due to their antidilutive effect[70] 12. Common Stock and Stock-Based Compensation | Metric | Shares | Weighted-Average Grant Date Fair Value | | :-------------------------- | :------- | :------------------------------------- | | Outstanding at March 31, 2023 | 2,251,224 | $23.85 | | Granted | 907,364 | $38.32 | | Issued | (782,561) | $24.11 | | Forfeited | (60,452) | $25.65 | | Outstanding at September 29, 2023 | 2,315,575 | $29.41 | | Metric | Shares | Weighted-Average Grant Date Fair Value | | :-------------------------- | :------- | :------------------------------------- | | Outstanding at March 31, 2023 | 2,748,347 | $23.47 | | Granted | 298,783 | $40.56 | | Excess shares issued due to achievement of performance condition | 462,739 | $24.99 | | Issued | (215,883) | $24.79 | | Forfeited | (47,414) | $23.28 | | Outstanding at September 29, 2023 | 3,246,572 | $24.32 | | Category | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :---------------------------------------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Cost of sales | $946 | $1,124 | $(178) | -15.8% | $3,552 | $1,956 | $1,596 | 81.6% | | Research and development | $3,602 | $1,711 | $1,891 | 110.5% | $6,470 | $2,839 | $3,631 | 127.9% | | Selling, general and administrative | $6,329 | $5,369 | $960 | 17.9% | $11,897 | $37,545 | $(25,648) | -68.3% | | Total stock-based compensation | $10,877 | $8,204 | $2,673 | 32.6% | $21,919 | $42,340 | $(20,421) | -48.2% | 13. Income Taxes | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :----------------------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Provision for income taxes | $7,400 | $8,438 | $(1,038) | -12.3% | $14,615 | $10,403 | $4,212 | 40.5% | | Effective tax rate | 10.1% | 14.3% | -4.2% | -29.4% | 10.4% | 14.6% | -4.2% | -28.8% | - The effective tax rate (ETR) year-over-year was primarily impacted by reductions in global intangible low-tax income (GILTI), Subpart F, and non-deductible stock-based compensation charges, offset by a decrease in FDII benefits[79] - The ETR was also reduced by discrete tax benefits related to stock-based compensation windfalls realized in the period ended September 29, 2023[79] 14. Related Party Transactions - Sanken Electric Co., Ltd., a related party, held approximately 51.2% of the Company's outstanding common stock as of September 29, 2023[80] | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :-------------------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Net sales to Sanken | $3,579 | $45,026 | $(41,447) | -92.0% | $3,579 | $86,735 | $(83,156) | -95.9% | - The distribution agreement with Sanken was terminated effective March 31, 2023, involving a one-time payment of $5.00 million to Sanken and a $4.20 million sales return[80] | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | Change | % Change | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | Change | % Change | | :-------------------- | :-------------------------- | :-------------------------- | :----- | :------- | :-------------------------- | :-------------------------- | :----- | :------- | | Purchases from PSL | $14,630 | $14,479 | $151 | 1.0% | $30,732 | $29,150 | $1,582 | 5.4% | - As of September 29, 2023, the outstanding balance of PSL Promissory Notes was $10.31 million[81] 15. Acquisition Related - On October 31, 2023, the Company completed the acquisition of Crocus Technology International Corp. for an aggregate purchase price of $420.00 million in cash[84] - Prior to the acquisition, Allegro MicroSystems, LLC provided Crocus with $7.00 million in subordinated promissory notes (Crocus Loans), which were repaid in full upon the closing of the transaction[85] - The purchase accounting for the acquisition has not yet been completed and will be finalized within the measurement period[84] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial condition, operations, cash flows, business updates, performance, and liquidity. Overview - Allegro MicroSystems is a leading global designer, developer, fabless manufacturer, and marketer of sensor ICs and application-specific analog power ICs for the automotive and industrial markets[88] - The company is a leading supplier of magnetic sensor IC solutions worldwide, based on market share, particularly in the automotive market[88] | Metric | 3 Months Ended Sep 29, 2023 | 3 Months Ended Sep 23, 2022 | 6 Months Ended Sep 29, 2023 | 6 Months Ended Sep 23, 2022 | | :---------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total Net Sales | $275,509 | $237,666 | $553,802 | $455,419 | | Net Income | $65,671 | $50,648 | $126,560 | $60,931 | Business Updates - On October 31, 2023, the Company completed the acquisition of Crocus Technology International Corp. for $420.00 million in cash[89] - A new $250.00 million Term Loan maturing in 2030 was entered into on October 31, 2023, to refinance existing term loans and partially finance the Crocus acquisition[91] - Prior to the acquisition, the company provided Crocus with $7.00 million in subordinated promissory notes, which were repaid upon closing[89] Other Key Factors and Trends Affecting our Operating Results Operating results are influenced by inflation, design wins, demand seasonality, product mix, and tax law changes. Inflation - Inflation has led to higher costs, including labor, wafer, materials, transportation, and energy costs[93] - The company has generally offset cost increases through productivity, cost reduction initiatives, price adjustments, and new products with improved gross margins[93] - Sustained high inflation could materially adversely affect business if price increases cannot fully recover costs[93] Design Wins with New and Existing Customers - Future sales are highly dependent on continued success in winning design mandates from customers[94] - The time from design initiation to sales can be lengthy (typically 2-4 years), requiring significant design and development expenditures without assurance of selection[94] - Average selling prices (ASPs) are expected to decline over time, making new design wins critical for future success[94] Customer Demand, Orders and Forecasts - Demand for products is highly dependent on market conditions in end markets, which are generally subject to seasonality, cyclicality, and competitive conditions[95] - Customer forecasts do not commit to minimum purchases and can be revised or canceled, posing risks of lost sales or excess inventory[95] - Most of the current customer order backlog is noncancellable, which helps mitigate exposure to unforeseen order cancellations[95] Manufacturing Costs and Product Mix - Gross margin is affected by ASPs, product mix, material costs, yields, and manufacturing efficiencies[96] - Long-term ASP declines are expected to coincide with improvements in manufacturing yields and lower wafer, assembly, and testing costs, offsetting margin reduction[97] - Gross margin fluctuates quarterly, generally decreasing with lower production volumes and increasing with higher volumes[97] Cyclical Nature of the Semiconductor Industry - The semiconductor industry is highly cyclical, characterized by rapid technological change, product obsolescence, competitive pricing pressures, and fluctuations in supply and demand[98] - Periods of rapid growth and capacity expansion are often followed by significant market corrections, leading to sales declines, inventory accumulation, and underutilized facilities[98] - Margins generally improve during expansion cycles and decline during periods of slower growth or industry contractions[98] 2017 Tax Cuts and Jobs Act - The 2017 Tax Cuts and Jobs Act requires capitalization and amortization of domestic and foreign R&D expenditures, increasing annual cash taxes by approximately $20.00 million for fiscal 2024[99] - This tax impact is partially offset by an FDII benefit of $9.00 million[99] - There is no assurance that Congress will modify or reverse this provision, despite potential retroactive effects[99] Results of Operations This section analyzes financial performance for three- and six-month periods, detailing sales, costs, and income drivers. Three-Month Period Ended September 29, 2023 Compared to Three-Month Period Ended September 23, 2022 For the three months, net sales and income increased significantly, driven by e-Mobility products and improved margins. Total net sales - Total Net Sales increased by $37.84 million (15.9%) to $275.51 million for the three-month period[101][103] - The increase was primarily attributable to higher shipments of e-Mobility products (ADAS, EV, and safety, comfort, and convenience applications)[103] - Growth was partially offset by declines in consumer and smart home markets[103] Sales Trends by Market | Market | Sep 29, 2023 | Sep 23, 2022 | Change | % Change | | :--------- | :----------- | :----------- | :----- | :------- | | Automotive | $205,936 | $157,398 | $48,538 | 30.8% | | Industrial | $51,114 | $48,176 | $2,938 | 6.1% | | Other | $18,459 | $32,092 | $(13,633) | -42.5% | - Automotive net sales increased primarily due to higher demand for ADAS, EV, and safety, comfort, and convenience applications[105] - Industrial net sales increased due to demand for clean energy and automation applications, partially offset by declines in data center applications[105](index=105&type=chunk