Good day, everyone, and welcome to the Lumentum Holdings Fourth Quarter and Fiscal Year 2021 Earnings Call. All participants will be in a listen-only mode. Please also note today's event is being recorded for replay purposes through August 25, 2021. At this time, I'd like to turn the conference call over to Jim Fanucchi of Darrow Associates. Sir, please go ahead.

Thank you, operator. Welcome to Lumentum's fourth quarter and fiscal year 2021 earnings call. This is Jim Fanucchi from Darrow Associates, assisting Lumentum with its Investor Relations. Joining the call today from the Company's management team, we have Alan Lowe, President and Chief Executive Officer; Wajid Ali, Chief Financial Officer; and Chris Coldren, Senior Vice President of Strategy and Corporate Development. Today's call will include forward-looking statements, including statements regarding the impact of COVID-19 and the responsive actions on our business and continuing uncertainty in this regard; trends and expectations for our products and technology; our markets, market opportunity and customers; and our expected financial performance, including our guidance, as well as statements regarding our future revenue, our financial model and our margin targets. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our current expectations, particularly the risk factors described in our SEC filings, including the Company's quarterly report on Form 10-Q for the fiscal quarter ended April 3, 2021, and in the Company’s Annual Report on Form 10-K for the fiscal year ended July 3rd, 2021, which the Company expects to file within 60 days of its fiscal year end. The forward-looking statements provided during this call are based on Lumentum's reasonable beliefs and expectations as of today. Lumentum undertakes no obligation to update these statements, except as required by applicable law. Please also note, unless otherwise stated, all results and projections discussed in this call are non-GAAP. Non-GAAP financials are not to be considered as a substitute for or superior to financials prepared in accordance with GAAP. Lumentum’s press release with the fourth quarter and the fiscal year 2021 results and accompanying supplemental slides are available on its website at www.lumentum.com under the Investors section. This includes additional details about our non-GAAP financial measures and a reconciliation between our historical GAAP and non-GAAP results. Now I will turn the call over to Alan for his comments.

Thank you, Jim. Good morning, everyone. The fourth quarter capped off a fiscal 2021 that, by all financial measures, was our best year ever with record revenue, margins, and earnings per share. This was despite the tough macro environment and impact of COVID-19, which caused our Lasers segment to be down more than 25% in fiscal 2021. Growing demand from new customer opportunities grew Optical Communications segment revenue up 7% and total revenue to a new record level in fiscal 2021. We are focused on end-markets that are driven by durable multi-year trends. We have been successful in developing differentiated new products and designing them into market-leading customers for their next-generation solutions, many of which are just starting to ramp. Our demand mix is increasingly shifting towards these products, which we believe could be signaling the start of a new accelerated growth phase in our markets. Supporting this belief were robust demand trends in the fourth quarter. We had very strong bookings resulting in a book-to-bill of 1.2. Telecom transport component revenue in the fourth quarter was higher than it has been in several years. I’ll provide more details on this later, but increased shipments of telecom transport components are typically a leading indicator of higher future telecom demand. Year-on-year, revenue from EML chips for datacenters was up more than 50%. During the fourth quarter, we had record Datacom chip backlog as cloud datacenters are transitioning to higher speeds where we have differentiated market-leading products. In 3D sensing, fourth quarter revenue was up 39% year-on-year. This was the highest fourth quarter 3D sensing revenue we have ever had and demand has been strengthening in the first quarter as well. The recovery in our Commercial Lasers business continued and resulted in a 17% sequential increase in revenue and a lasers book-to-bill of 1.2. We expect a favorable demand environment throughout fiscal 2022. Customers have communicated that they are seeing accelerated end market demand for their next-generation solutions. And this should not be a surprise as our markets are driven by powerful long-term trends. The accelerating transition to digital and virtual approaches in all aspects of work and life is driving staggering amounts of data in the world's networks and cloud datacenters. The proliferation of 5G wireless will remove bandwidth bottlenecks at the edge of the networks and will create the need for even more capacity in metro and core networks, as well as in cloud datacenters. The computer and machine vision resolutions are in their early days, and we expect 3D sensing and LiDAR capabilities will expand to many more applications in multiple markets. Laser-based material processing is critical to the manufacturing of these devices, enabling the digital transformation and the transition to 5G wireless, electric vehicles, and energy storage. Now turning to additional product line details. For fiscal year 2021, Telecom and Datacom revenue was up 4%. Excluding the low margin product lines we exited over the past two years, revenue from Telecom and Datacom each were up by 10% or more in fiscal 2021. While customer demand is very strong, fourth quarter Telecom and Datacom revenue was approximately flat quarter-on-quarter and year-on-year. Revenue growth is being muted temporarily by supply constraints, which have increased recently as we have consumed much of our buffer stocks. In Telecom, revenue growth in higher level module products, including ROADMs, is being constrained by the supply of critical semiconductor components. We are intensely focused on minimizing the impact of these shortages on our customer deliveries. At this time, however, semiconductor supply shortages are negatively impacting our first quarter revenue outlook by more than $30 million. But again, our team is working diligently to improve upon this situation. As I mentioned earlier, in our telecom transport component product lines, which are not impacted by semiconductor shortages, we had fourth quarter revenues higher than we have seen in several years. For example, fourth quarter terrestrial pump laser revenue was at the highest quarterly level in the last three years and the second highest in more than a decade. Fourth quarter submarine components revenue, which is primarily from high reliability pump lasers used in undersea cable applications, was also at the highest quarterly level in several years. These data points are particularly important as pump lasers are critical to lighting up new optical amplifiers, which historically has happened early in both greenfield deployments and network expansions. Because of this, elevated pump lasers shipments have typically been a leading indicator of future deployments of other telecom products. We expect this strong telecom demand to continue to increase in fiscal 2022. Demand for Datacom comp chips for cloud datacenters is also very strong. Our highly differentiated products are enabling cloud datacenters to transition to 200 gig and 400 gig speeds. As I mentioned earlier, during the fourth quarter, we had record high Datacom chip backlog and record high EML revenue, which was up more than 50% year-on-year. This backlog will be delivered over multiple quarters, because we are production capacity constrained on Datacom chips. Our previously highlighted Datacom production capacity expansion is tracking well and will result in significant increased output starting in the second half of fiscal 2022. Due to expected long-term demand growth, we are making additional production capacity increases beyond those we previously discussed. Looking to the first quarter, Telecom, Datacom demand is continuing to grow. However, we expect revenue to be down quarter-on-quarter as the semiconductor shortages I spoke about earlier have in the near-term become increasingly impactful to our ability to meet our growing customer demand. Fourth quarter industrial and consumer revenue was down 25% sequentially, but up 34% year-on-year to the highest fourth quarter level we have ever delivered. We continued to increase our design-ins and traction in the automotive space in the fourth quarter, especially with our high-power five junction VCSEL technology for LiDAR applications, but also with VCSELs for in-cabin driver monitoring systems. In the first quarter, we expect industrial and consumer revenue to be up sequentially as production continues to ramp from major customer new products. Turning to Commercial Lasers. In the fourth quarter, we had significant revenue increases in most major product lines. The most notable increase was in our kilowatt fiber laser. The growth in our Laser Service business was also meaningful, as utilization of our lasers in the field continues to increase. Our Lasers segment is now recovering ahead of our original expectations and will be a contributor to growth in fiscal 2022. We expect first quarter Lasers revenue to be up again quarter-on-quarter. Throughout my remarks, I've highlighted that our markets are driven by strong long-term trends and that we are well-positioned with differentiated new products and key design wins with market-leading customers. We believe the continuing shift in our demand mix towards differentiated products that enable next-generation customer solutions is a leading indicator for growth over the coming years. Before handing it over to Wajid to review the numbers, I want to once again thank and acknowledge all of our employees around the world for their hard work and contributions during these challenging times. Our employees are absolutely the company's greatest asset. They are the ones responsible for our outstanding and record fiscal 2021 results and for putting us in such a great position for growth in the coming years. I would also like to thank our customers, suppliers, and shareholders for their continued support and partnership. The future is truly bright at Lumentum. With that, I'll hand it over to Wajid.

Thank you, Alan. Good morning, everyone. As Alan highlighted, fiscal 2021 sets a new bar for us financially with record revenue, margins, and earnings per share. On margins, we achieved our previously announced target model a year earlier than originally projected. Based on our confidence in our long-term financial performance, we started aggressively executing on the $700 million share buyback program we announced last quarter, purchasing 3.1 million shares or 4% of our outstanding shares for $241 million. Before jumping into the results, I'd like to highlight some changes we decided to make on how we calculate our non-GAAP tax provision. In order to give a more meaningful perspective of our tax burden over a longer term period, reduced quarter-to-quarter variability in our non-GAAP tax rate and in light of our growing profitability and utilization of our historical tax attributes, beginning in our fiscal fourth quarter, we are changing our method of calculating our non-GAAP income tax provision. For this quarter only, to help with comparisons, we are providing our non-GAAP tax provision using both the prior method and our new method. On our Investor Relations website, we have provided additional data to help with historical comparisons. To be clear, this change in methodology does not affect our non-GAAP operating profit, annual cash tax payments or cash flows. But it should result in more consistent, but higher reported non-GAAP tax provisions going forward, and it will have no effect on any of our GAAP results. Based on our analysis, we expect our non-GAAP long-term tax rate under the new method of calculation to be in the range of 13% to 16%. Now turning to the fourth quarter's numbers. Net revenue for the fourth quarter was $392.1 million, which was in the upper half of our guidance range, down 7% sequentially and up 7% year-on-year. GAAP gross margin for the fourth quarter was 41.5%, GAAP operating margin was 11.7% and GAAP diluted net income per share was $0.28. Fourth quarter non-GAAP gross margin was 47.7%, which was down 220 basis points sequentially as expected, but up 50 basis points year-on-year with a better mix of products, and lower relative manufacturing costs. This sequential decline relates to the seasonal change in product mix and volumes, while the year-on-year growth was driven primarily by improved gross margins in the Optical Communications segment. Fourth quarter non-GAAP operating margin was 24.6%, which decreased 330 basis points sequentially and 20 basis points year-on-year. The sequential decline was driven by the expected gross margin decline and increase in operating expenses quarter-on-quarter. The year-on-year decline was driven by increased operating expenses. Fourth quarter non-GAAP operating expenses totaled $90.6 million or 23.1% of revenue. SG&A expense was $41.5 million, R&D expense was $49.1 million. Fourth quarter non-GAAP operating income was $96.6 million and adjusted EBITDA was $117.5 million. Other income and expense was a net expense of $0.7 million on a non-GAAP basis. Our fully diluted share count for the fourth quarter was 77.5 million shares. Under our prior method of tax calculation, fourth quarter non-GAAP net income was $89.5 million and non-GAAP diluted net income per share was $1.15. Under our new method of tax calculation, fourth quarter non-GAAP net income was $81.9 million and non-GAAP diluted net income per share was $1.06. Our non-GAAP results include the additional cost of goods sold we are incurring related to procuring semiconductor components that are in short supply globally and the measures we are taking to prevent the spread of COVID-19 in our sites. Turning to the full year results. Fiscal 2021 net revenue was $1.74 billion, which was up 4% from fiscal 2020. Excluding the low margin product lines we exited over the past two years, revenue was up 8% in fiscal 2021 over fiscal 2020. GAAP gross margin for fiscal 2021 was 44.9%, GAAP operating margin was 30.2% and GAAP diluted net income per share was $5.07. Full year fiscal 2021 non-GAAP gross margin was 50.9%, which was up 440 basis points relative to fiscal 2020 due to our improving model with a better mix of products and lower relative manufacturing costs. Fiscal year 2021 non-GAAP operating margin at 30.8% increased 420 basis points from that of fiscal 2020, driven by the gross margin expansion offsetting increases in R&D spending year-over-year. Fiscal 2021 non-GAAP operating income was $536.1 million and adjusted EBITDA was $621 million. For fiscal 2021, our fully diluted share count was 78.4 million shares. Under the prior method of tax calculation, fiscal 2021 non-GAAP net income was $495 million and non-GAAP diluted net income per share was $6.31. Using our new method of tax calculation, fiscal 2021 non-GAAP net income was $458.2 million and non-GAAP diluted net income per share was $5.84. On the balance sheet, we ended the quarter with approximately $1.95 billion in cash and short-term investments. We continue to have $1.5 billion in aggregate principal convertible notes and no term debt. Cash flow from operations in the fourth quarter was $124.2 million and for the full year, it was $738.7 million. The full year cash flow from operations includes a net of $207.5 million from the Coherent termination. Turning to segment details. Fourth quarter Optical Communications segment revenue at $355.2 million decreased 8% sequentially due to seasonally lower revenues in industrial and consumer. Fiscal 2021 Optical Communications segment revenue was up 7% over fiscal 2020. Optical Communications segment gross margin at 47.7% decreased 240 basis points sequentially due to lower industrial and consumer in the revenue mix and due to increased cost of procuring certain components impacted by worldwide shortages. Fiscal 2021 Optical Communications segment gross margin at 51.2% was up 470 basis points relative to fiscal 2020 due to a higher mix of higher margin product lines and improvements in operational efficiency and footprints. Our fourth quarter Lasers segment revenue at $36.9 million increased 17% sequentially due to the ongoing recovery from the impact of COVID-19. Fiscal 2021 Lasers revenue was down 25% relative to fiscal 2020 due to COVID-19-related slowdowns and end-market demand. Fourth quarter Lasers gross margin was up 130 basis points sequentially at 48.5%. Fiscal 2021 Lasers segment gross margin was up 30 basis points relative to fiscal 2020. Now on to our guidance for the first fiscal quarter of fiscal 2022, which is on a non-GAAP basis and is based on our assumptions as of today. We expect net revenue for the first quarter of fiscal 2022 to be in the range of $430 million to $445 million. Our revenue projection assumes Telecom and Datacom decreasing quarter-on-quarter, Industrial and Consumer increasing due to normal seasonality in the consumer portions and Commercial Lasers increasing quarter-on-quarter, again, driven by further market recovery from COVID-19. And as Alan noted earlier, demand is very strong, but our revenue outlook includes a negative impact of more than $30 million due to semiconductor component supply shortages. Based on this, we project first quarter operating margin to be in the range of 30.5% to 32.5% and diluted net income per share to be in the range of $1.47 to $1.61. Our non-GAAP EPS guidance for first quarter is based on a non-GAAP annual effective tax rate of 14.5% or $19.9 million at the midpoint. These projections assume an approximate share count of 76 million shares and an other income and expense that is a net expense of approximately $1 million. These projections also include the additional expenses we are incurring related to procuring semiconductor components and COVID-19 protective measures. With that, I'll turn the call back to Jim to start the Q&A session.

Thank you. Before we start the question-and-answer session I would like to ask everyone to keep to one question and one follow-up. This should help us get to everyone before the end of our allotted time. Operator, let's begin the question-and-answer session.

We will now begin the question-and-answer session. The first question comes from Tom O'Malley with Barclays. Please go ahead.

Hey, guys. Thanks for taking my question and good morning. It sounds like in the telecom business, trends are really strong on the pump laser side. Can you talk about what you're seeing in terms of transport deployments into the back half of this year? And then, with what you just reported in June, it kind of implies some weaker transmission. Can you talk about is that COVID-related? Or is that some slowing demand in the transmission side?

Yes. Hi, Tom. This is Alan. As we said in the script, the transport component growth usually is a leading indicator for future other growth. And that's what we're seeing play out. What we think is going to play out in the first half of fiscal 2022. And so, we are seeing broad demand of ROADMs, ROADM line cards that usually go along with these transport components that really build out the initial either greenfield or their expansion of existing networks. And so, I think outlook for transport is extremely strong. I need to get some semiconductor chips in to really be able to satisfy customer demand when they want it. As far as transmission is concerned, we are seeing strength in transmission outlook. In coherent components, on our tunable lasers, on our tunable – on our modulators, high-bandwidth modulators, as well as surprisingly enough on 10 gig tunables. And so, across the board, ACOs are continuing to go strong while down from peak levels. But there is a lot of chassis out in the market in networks that are waiting for ACOs. And so, I think we are in pretty good position there. And as we start to get qualified on our 400 gig DCO modules, I think we're going to see a pickup in our transmission business throughout the year.

That’s helpful. And then my follow-up is on the Commercial Lasers business. If you look at your peers, there has been just calls for weakness kind of across the board. You obviously have a different customer concentration than some of your peers. Can you talk about your success there? Is that more related to the geography? Or are you really seeing a balance off the bottom that's related to some weakness over the past year? Can you just walk through the puts and takes of what's driving that strength versus others who are seeing some weakness?

Sure. I think twofold. You're right. Our customer base is different. We have limited exposure into China, especially with our kilowatt fiber laser customer. And from that perspective, we are seeing a good bounce back in overall demand on our kilowatt fiber lasers that typically go outside of China end markets. We are seeing certainly, as everyone has seen, a pickup in semiconductor demand and that's why we commented on our service – our Laser Service business picking up, which is usually a good indicator of usage of our lasers in the field. And then we are seeing also our micro machine business pick that typically goes with semiconductor upswings, both be it on the dealing of semiconductors or the components that they go on in PCBs and things like that. So, I do think it's a different customer base and a different end market that we address compared to some of our peers.

Yes. Good morning, guys. Thanks for the question. I guess, I wanted to kickoff with 3D sensing share. I know last quarter you guys had talked about - you talked pretty cautiously about share and now the numbers look pretty good. So, I'm just curious how share is tracking for you now and on into the back-end of the year relative to what you were thinking last quarter? And then I have a follow-up.

Yes. Rod, thanks for the question. Our commentary last quarter was around the market size and in our expectation for average selling prices due to the smaller chips in the next-generation of our leading customer products. And so, I'd say, given the Q4 revenue, our biggest Q4 ever in 3D sensing, I think, we bode pretty well with respect to share. I do think that the product is in – it has not even been announced yet. So it's really in the early stages with respect to how share is going to play out over the long-term, but I would say that we are positioned very, very competitively. And as we've proven to our lead customer, we are there for them with high-quality, meeting their production outputs and their expectations. So, I feel really good about our share.

Okay. Great, Alan. That's good. Thank you. And then my follow-up with on the $30 million. I know you commented ROADM was supply constrained, Datacom is capacity constrained. I am just curious like how that $30 million kind of breaks down across the business. Is it mostly ROADM? Is it - could you give us any color on what's in the $30 million? What particular lines are affected there?

Yes. In the $30 million, we did not include our internal capacity constraints, like, to your point on Datacom. This is our product that our customers want that we can't deliver because we can't get the semiconductors. And that is mainly around our transport products ROADMs, ROADM line cards, a little bit on our transmission products, but most of the $30 million really comes from our telecom transport area.

Thanks. So, going back on to the 3D sensing for a second, clearly, the supply conditions broadly are causing everybody to be very anxious about supply. And so, it seems like the 3D sensing production probably is anticipating potential risks to supply as the products get launched. So, are we pulling forward some of that demand into the June quarter that might have been something that was produced later in the year? Does it change your outlook for the overall FY 2022 outlook to have pulled that much volume into the - to the June quarter?

Hey, Alex, this is Chris. I would say, it's a little early to tell exactly what's going on overall. But we don't believe this is necessarily a significant pull forward. You got to remember last year, there was a delay, if you will, in the customers’ product cycles due to COVID-19. And so, kind of if we look back in years before, in more normal seasonal trends and then considering the additional dollar content and volume relative to, say, two years ago, three years ago, things look relatively normal that - but again with that caveat that it's very early to tell what's going on in this product cycle.

So, have you changed your thought on the full year FY 2022, kind of growth potential?

Yes. I would say, we have not changed our view necessarily on the market outlook. But I think as Alan indicated earlier that market outlook has a lot of variables like what, overall market pricing and what volumes and mix are going to be. And those - we only - only have guesstimates to one quarter’s worth of the product cycle so far. So, our previous views on the aggregate opportunity are not changed materially at this point.

Great. Thanks. Maybe wanted to ask a question. In the last quarter, you had noted not expecting kind of a tick up in transport until kind of early 2022. Just trying to get a sense of, is this - some of those projects you got one hit until calendar 2022 hitting today? Or just any commentary about how it's tracking to kind of previous expectations? And then, the second just being China has clearly had a build of some inventory that you were expecting to clear later on in the year, just any update there?

Yes. Hi, Meta. Yes. I would say that we have seen a bit of a demand change from expectations of three months ago in that the demand for transport. And I think it's real demand. I don't think it's a bunch of double ordering. But it's hard to say. And I can usually gauge that by how many CEOs call me and ask for deliveries and I can tell you it's brisk. So, I would say that the transport demand is real. It's picked up more than we had expected. And if we were able to get the semiconductor chips that we need, I think we would be able to really, really ramp up our transport revenue. But we're continuing to work on that. So don't get me wrong. I think the challenge we had is, we built up some semiconductor inventories that - for flex demand and more demand came in than we had expected. And therefore, we're unable to satisfy all of that demand. I would say that the longer term demand trends from our perspective are very solid as we talked about the transport components and some marine cables going in throughout the world really are leading indicators for future demand and our product positioning for our end-by-end where now it's starting to proliferate significantly outside of China is very, very strong.

And - well, I think you had mentioned last quarter that, you thought there may be some inventory within China that should be clearing kind of in the calendar Q4 period. And so, just trying to see if any of the pickup you were seeing in China is kind of ahead of expectations.

Yes. I'd say, for the inventory, we were specifically talking about our 5G Datacom chip inventory that in fact we've had a revenue deferral in prior quarters. We have seen activity around 5G, but that inventory is slow moving so far. We expect that to start picking up over the next several months. And to your point, hopefully that will be flushed through the system by the end of the calendar year and then start meaningful DML laser chips shipments into calendar 2022.

Hey. Good morning. Thanks for taking my questions. I guess, Alan, if I could just start with the supply constraints here and from the tone of your conversation it does sound like things are getting a bit lowered. So, just wanted to get a sense, I know it's a bit early for fiscal 2Q and onwards, but should we be thinking about more material headwinds than the $30 million or maybe some headwinds on margins as you go out and procure inventory? And as a second part to that, seasonally, we've seen Telecom and Datacom move up from 1Q to 2Q. Does the supply constraints limit your ability to deliver to that in this year? Thank you.

Yes. I would say, it's a little early to say, because, I am having discussions with the executives at the semiconductor companies that are continuing to work to try to support us. And we're hopeful we can make further progress with them and we booked out long, long lead times, orders for these critical semiconductor chips that will not – we will consume, because their long tails, long life in our ROADMs and ROADM line cards. And so, I think from that perspective, it's hard to say what's going to happen in Q2, because, in fact, later today, I've got a call with the CEO of a semiconductor chip company that's one of our big bottlenecks and I'm hopeful to get good news. But that news would only impact Q2. I would say that on the margin front, unlike others, we've included the cost of expediting semiconductors or paying brokers higher charges, we've included those costs in our non-GAAP numbers. And so, you saw that impact in Q4 and it's in our guidance to continue to pay those higher prices and expedite fees to semiconductor companies in our Q1 guide and I expect them to also be in our Q2 performance, as well.

Hi guys. Thanks very much. I guess, I wanted to dig into the - sort of Huawei discussion going back year, year-and-a-half ago. And if I look back, I think the narrative from you guys was really around as the Huawei business ramp down, given the U.S. Government controls, you would see opportunities to win more sockets, more market share in other traditional system suppliers if they take share from Huawei around the world. And I am kind of wondering like if you can revisit that narrative and what are you seeing in the marketplace in terms of share your traditional customers B2B Huawei?

Yes, George. Thanks. This is Chris. And I'll take first stab at it and let Alan come in and add to it. But certainly, on the Huawei fronts, right, we continue to have business with Huawei. It has significantly declined year-over-year. And that's really driven by the fact that they have opportunities to buy some of what we were supplying from non-U.S. suppliers, they are tending to buy from non-U.S. suppliers when they can do that. Fortunately for us, many of those situations are product lines that prior to the U.S. actions against Huawei, we decided to get out of, for example within high band modulator and Datacom modules. Countering that is some of our more leading-edge technology, for example in ROADMs, there may not be a non-U.S. supplier and there may not be another supplier in the world with our capabilities. And so, we've seen those product lines grow within Huawei and sort of push back a little bit on the headwind, the net headwind we have with them. That said, there certainly is activity around the world where service providers are looking to use western suppliers more extensively and that has resulted perhaps in some near-term increased sales for our western network equipment manufacturers. But to be clear, that's a long term opportunity for our customers and therefore us, given you can't switch network vendors overnight. That's a multiple quarters if not multiple year process to do that. And as we've highlighted in the past, our share of wallet with our western customers is significantly higher than with Huawei. And therefore, as that transition continues to unfold over the next few years, we should be a net beneficiary of that given that share of wallet.

Thanks for taking the question. I wanted to see if you could update us regarding the comments you made on the prior earnings call on the 3D sensing market, when you indicated you expected the market would be down 20% to 25% in your fiscal 2022. I discern, maybe a little bit more optimism on today's call with the additional commentary around the automotive opportunities. If you could just update us on how you are thinking there and then I've got a follow-up.

Sure. Simon. This is Alan. Thanks for the question. I would say that, again, our commentary around our fiscal 2022 3D sensing market was really around the average selling price of chips going into next-generation devices, going down as a result of smaller die sizes. And so, two things. One of which is, again, record Q4 results position very well. That's not part of our perspective on market because share is still not clear. But we're feeling pretty good about that. I would say, until a device gets announced and the traction that the end-user – end-customer really comes through, it's going to be hard to say what is going to happen to overall unit demand. And so, our commentary was around, hey, if unit demand is flat, we believe the market is going to be down 20% to 25%. Now does it look like that's playing out? Maybe you might sense a softening with respect to with those numbers. But it is going to be down assuming units are flat. Now, is our lead customer gaining share? I think so. And therefore, maybe, there could be higher unit volume that would offset some of that average sales price per chip in our fiscal 2022. Yes. And then, as far as your other question about, is that demand there when we are able to satisfy it, I'd say, yes, mostly because, a lot of that demand is very high-end ROADMs where we are the leader and in most cases, if not all cases sole source. And so, that's why we're working extremely hard to get the semiconductor we need because our customers bet on us and we certainly don't want to let them down. So, I'd say that demand is there when we are able to satisfy.

Hi. Good morning guys. Congrats on the strong execution and thanks for taking the question. Questions two, if I could? I guess, the first one is on 3D sensing - going back to 3D sensing. Is there any opportunity to get more favorable pricing through fiscal 2022 than what you were originally thinking 90 days ago? Any context there would be great. And then I have a quick follow-up. Thanks.

Yes. I mean, we're not going to talk specifically about our price discussions with our customers. I would say that, we do sign up for multi-year agreements and those tend to be intense negotiations that we're very happy with where we ended up, I'll put it that way.

Sorry. This is Chris. On 5G chips, in China, what I would say is, it’s - I would - well there is probably an element of requalification where our customers have needed to obtain alternate sources of semiconductor chips for their base station designs. But I think the way that a lot of folks are tracking, it is around tender activities and tender awards for base stations. And this summer, there has been some tender activity, tenders awarded to network equipment manufacturers by the China mobiles, China telecoms of the worlds to deploy additional base stations. I would say the activity there was moderate. There wasn't a huge uplift, if you will, in expected volumes but on the other hand, good to see that those tenders were released and awarded. And we expect, as Alan highlighted earlier, that once the overall supply chain works down the inventory of product that we've already provided, which should happen over the next few quarters that as we get into the middle of our fiscal year or into the new calendar year that we would then see a resumption in growth for us for those products.

Yes. And maybe if I could just add, as well. The good news is, there is a lot of activity in China not with just our large customer, but with others on transport deployment. So, metro and long haul deployments are continuing. And I believe that's usually an indicator that there is a commitment to build out the 5G networks, because once you do that, then the bottleneck at the edge of the network really gets alleviated and you need to make sure you have the metro and the core networks built out and we're seeing a lot of activity in that area.

Great. Thank you, Drew. This does conclude our call for today. We would like to thank everyone for attending. And we look forward to talking with you all again when we report the first quarter fiscal 2022 results in early November. Thank you, and have a great day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.