MACOM(US:MTSI)2021-11-04 17:28Financial Data and Key Metrics Changes - Revenue for Q4 2021 was $155.2 million, with adjusted EPS of $0.61 per diluted share, marking a 1.7% increase quarter-over-quarter [7][35] - For the full fiscal year 2021, revenue was $607 million, representing a 14.5% year-over-year growth, and adjusted EPS was $2.15, up from $0.98 in fiscal year 2020 [8][41] - Adjusted operating margin exceeded 30% for the first time since going public, with adjusted operating income for Q4 at $46.8 million, up from $43.9 million in Q3 [10][39] Business Line Data and Key Metrics Changes - Revenue by end market for Q4 included Industrial and Defense (I&D) at $75.1 million, Telecom at $46.6 million, and Data Center at $33.5 million [13] - For fiscal year 2021, I&D revenue increased by 44%, Data Center by 10%, while Telecom revenue decreased by 10% [13] - The company reported a book-to-bill ratio of 1.2:1 for Q4 and a diversified customer base with top 10 customers representing 26.5% of total revenue [10][13] Market Data and Key Metrics Changes - Domestic customers accounted for approximately 46% of revenue in both Q4 and fiscal year 2021, an increase from 36% and 41% in the previous year [36] - The company noted supply chain challenges affecting production capacity, particularly in semiconductor and packaging technologies [12][60] Company Strategy and Development Direction - The company aims to achieve at least 10% year-over-year revenue growth in FY 2022, supported by new product introductions and market share gains [51] - MACOM is focusing on diversifying its technology portfolio and customer base, with significant investments in R&D and production capabilities [28][30] - The company is also expanding its presence in the automotive sector, leveraging its technologies for applications like sensors and autonomous driving [30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged supply chain constraints but emphasized that these are viewed as short-term issues that will not hinder long-term growth [60] - The company is optimistic about its backlog and new product introductions, which are expected to drive future revenue growth [55][56] Other Important Information - The company achieved a net leverage ratio of around 1.7x and gross leverage of 3.1x, down from 3.4x and 5.5x in fiscal 2020 [45] - Standard & Poor's upgraded MACOM's credit rating from B to B+, reflecting operational and financial improvements [46] Q&A Session Summary Question: Growth trajectory towards $1 billion in sales by 2025 - Management remains confident in achieving long-term goals, starting the year with a near-record backlog and a strong product pipeline [54][55] Question: Supply chain bottlenecks - Constraints exist in semiconductor technology and assembly capacity, but these are considered tactical issues manageable by the operations team [60] Question: Data Center business outlook - The Data Center segment is expected to grow 8% to 10% in FY 2022, with strong growth anticipated in 100G and 400G applications despite some legacy business decline [66][70] Question: Telecom segment growth - Telecom is expected to see growth in cable infrastructure and PON, with steady demand for 5G front haul products [77] Question: Revenue left behind due to supply issues - Management does not quantify potential lost revenue but emphasizes that forecasts consider customer schedules and material availability [81][82] Question: Margin structure at $1 billion revenue run rate - While difficult to project, management aims to launch products with above-average margins to drive profitability [90][91] Question: New product introductions and gross margins - The company successfully met its new product introduction targets and expects to accelerate this in FY 2022, focusing on profitability improvements [96][97]