SYNAPTICS Inc Q1 FY2026 Earnings Call

Good day, and thank you for standing by. Welcome to the Synaptics First Quarter Fiscal Year 2026 Financial Results Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Munjal Shah, Head of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us today on Synaptics' first quarter fiscal 2026 conference call. My name is Munjal Shah, and I'm the Head of Investor Relations. With me on today's call are Rahul Patel, our President and CEO; and Ken Rizvi, our CFO. This call is being broadcast live over the web and can be accessed from the Investor Relations section of the company's website. In addition to a copy of our earnings press release detailing our quarterly results, a supplemental slide presentation and a copy of these prepared remarks have been posted on our Investor Relations website. Today's discussion of financial results is presented on a GAAP financial basis, along with supplementary results on a non-GAAP basis, which excludes share-based compensation, acquisition-related costs, and certain other noncash or recurring or nonrecurring items. All non-GAAP financial metrics discussed are reconciled to the most directly comparable GAAP financial measures in our press release and supplemental materials available on our Investor Relations website. As a reminder, the matters we are discussing today in our prepared remarks, in our supplemental materials, and in response to your questions may contain forward-looking statements. These forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance, and business. Although Synaptics believes that estimates and assumptions underlying these forward-looking statements to be reasonable, they are subject to a number of risks and uncertainties beyond our control. Synaptics cautions that actual results may differ materially from any future performance suggested in the company's forward-looking statements. Therefore, we refer you to the company's earnings release issued today and our current periodic reports filed with the SEC, including our most recent annual report on Form 10-K and quarterly report on Form 10-Q for important risk factors that could cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements speak only as of the date hereof. Except as required by law, Synaptics expressly disclaims any obligation to update this forward-looking information. I will now turn the call over to Rahul.

Thank you, Munjal. Good afternoon, everyone, and thank you for joining our fiscal Q1 2026 earnings call. We had an outstanding start to our fiscal year, delivering strong results that reflect the continued momentum in our business. Revenue in our Core IoT portfolio grew by 74% year-over-year, driving 14% revenue growth for the company. Our strength was broad-based across both processors and wireless connectivity. We delivered strong earnings growth, with non-GAAP earnings per share up 35% year-over-year to $1.09. As a company, we are sharpening our focus and aligning our resources to capture the growing opportunity in Edge AI. In the last quarter, we met with customers across the globe and at our Tech Day here in San Jose. Those discussions have affirmed my confidence in our ability to strengthen our leadership in this market. By bringing together our unique capabilities in analog mixed-signal, multi-core processing, and advanced wireless connectivity, we are enabling customers to bring intelligence to the Edge. This quarter, we reached a major milestone in our Edge AI roadmap with the successful launch of our next-generation Synaptics Astra Edge AI processors. Astra introduces a new class of AI-native silicon, built from the ground up to power the next wave of intelligent devices at the Edge. These products represent a decisive leap forward in our Edge AI strategy and reflect our strong execution and firm commitment to leadership in this market. Importantly, Astra is not just a standalone product, it brings together Synaptics' integrated approach to high-performance solutions by incorporating our processing, wireless connectivity, and mixed-signal capabilities. The response from customers, ecosystem partners, and the media has been very positive for the following reasons: First, we developed the new generation of Astra SL2600 series to enable billions of AI devices at the Edge, from battery-powered devices to high-performance industrial systems. It delivers industry-leading price performance to enable intelligence at the far Edge. Its scalable architecture allows our customers to address a wide range of applications, including those that require multimodal human-machine interface, vision, and voice capabilities across consumer, enterprise, and industrial end markets. Customers can future-proof their designs as requirements for multimodal compute, power efficiency, application features, and AI models continue to evolve. Second, we introduced Synaptics Torq AI in the new generation of Astra processors. Torq combines a future-ready neural processor architecture with open-source compilers, setting a new standard for IoT AI application development. Further, as part of our close collaboration with Google Research, we have integrated their open-source Coral NPU, a machine learning accelerator optimized for energy-efficient AI at the Edge. This silicon-level collaboration enables customers to develop innovative Edge products with AI inference across a broad range of applications. Third, the Synaptics and Google partnership is fundamentally about creating a robust and open software development environment that elevates AI-native Edge IoT product development from a highly fragmented, proprietary ecosystem into a unified, open-source approach. Developers now have access to multiple flexible and scalable programming frameworks, comprehensive software development kits and tools, and a rich repository of resources that include pre-optimized models, multimodal AI applications, and a curated developer experience supporting a wide range of use cases. Our lead customers have begun sampling the new Astra SL2600 devices, and we are already securing design wins. We expect initial revenue contributions to start in the second half of the calendar year 2026. This marks a significant execution milestone for our engineering and product teams, reflecting their outstanding commitment to innovation. Looking ahead, the AI inference compute opportunity is significant as hybrid compute across the data center and the Edge is taking shape. We are already seeing strong early traction and a healthy pipeline of customer engagements. We had hundreds of customers and partners join us at our Tech Day, where we showcased Edge AI use cases such as industrial vision, fleet management, home automation, smart appliances, IoT hubs, and robotics. Moving to our wireless connectivity portfolio, we had a solid quarter with strong execution across our strategic priorities. Our Wi-Fi 7 and broad-market solutions are starting to gain traction, and our roadmap remains firmly on schedule. Development of our wirelessly connected microcontroller with AI, all in a monolithic silicon, is advancing as planned, and we look forward to sharing more in the quarters ahead. Across our Core IoT portfolio, we achieved multiple wireless connectivity and processor design wins spanning a diverse range of end markets, including action and sports cameras, educational and commercial tablets, point-of-sale systems, unified communication platforms, operator solutions, and wearables. We're also seeing increasing customer commitments in home security systems, Matter-enabled IoT hubs, trackers, AI-enabled wearables, and body cameras. As we continue to invest in our roadmap, execute on our engineering goals, and deepen partnerships with our leading customers, we feel confident in our ability to deliver long-term growth across our processor and wireless connectivity portfolio centered on enabling AI at the Edge. Let me now turn to our mixed-signal technology products. In Enterprise & Automotive, our PC products continue to show steady improvement, and our broader enterprise portfolio continues to recover. We have gained market share over the last year, and we expect the momentum to continue into the current quarter. While we continue to see softness in automotive due to subdued market demand, we are benefiting from the continuation of our existing designs and are actively investing in new innovative automotive solutions that will help increase our silicon content. In Mobile Touch, we are seeing strong customer traction with our next-generation touch controller, which features a differentiated multi-frequency architecture designed for foldable OLED phones and other large-screen applications. This new design enables thinner and larger panels and integrates advanced sensing and filtering capabilities to effectively manage display noise. It also supports continuous time sensing, offering customers greater design flexibility and more cost-effective integration. We have secured marquee design wins with a top Android phone OEM and we are also seeing strong interest from OEMs in China for smartphones and tablets. We expect these wins to start contributing to revenue in the next fiscal year. Notably, our content in foldable phones will be more than twice that of our current smartphone designs. As the adoption of foldable phones increases, we are optimistic about the opportunity it creates for Synaptics. Overall, we are seeing steady improvement in our financial performance, with both revenue and EPS increasing sequentially and year-over-year. This progress reflects the strong execution across our organization, particularly from our engineering teams, who continue to deliver on our product roadmap. Our pipeline of opportunities is expanding, and we believe we are well-positioned to build on this momentum. I am confident that our focus, innovation, and disciplined execution can drive long-term growth for Synaptics. I will now turn the call over to Ken to review our first quarter financial results and outlook for our fiscal 2026 second quarter.

Thank you, Rahul, and good afternoon, everyone. I will focus my remarks on our non-GAAP results which are reconciled to GAAP financial measures in the earnings release tables found in the investor relations section of our website. Now let me turn to our financial results for the first quarter of fiscal 2026. Revenue for fiscal Q1 was $292.5 million, above the midpoint of our guidance and up 14% on a year-over-year basis driven by strength from our Core IoT products. The revenue mix in the first quarter was as follows: 35% Core IoT, 51% Enterprise and Automotive, and 14% Mobile Touch products. Core IoT product revenues increased 74% year-over-year, driven primarily by increased demand for our processor and wireless connectivity products. Enterprise & Automotive product revenues were flat year-over-year with strength in our enterprise portfolio offset by softness in Automotive. Mobile Touch product revenues were lower than expected, in part, due to supply chain constraints during the quarter. First quarter non-GAAP gross margin was 53.2%, in line with our guidance range. And first quarter non-GAAP operating expense was $104 million, slightly better than the midpoint of our guidance range. Our non-GAAP operating margin was 17.6%, up approximately 110 basis points sequentially and 90 basis points year-over-year. Non-GAAP net income in Q1 was $43.3 million. And non-GAAP EPS per diluted share came in above the midpoint of our guidance at $1.09 per share, an increase of 35% on a year-over-year basis. Now, let me turn to the balance sheet. We ended the fiscal first quarter with approximately $459.9 million in cash, cash equivalents, and short-term investments, up approximately $7.4 million from the prior quarter. Cash flow from operations was $30.2 million in the first fiscal quarter. We repurchased $7.2 million of our shares during Q1 and a total of $15 million of our shares through today. Capital expenditures for the first quarter were $12.2 million, in part driven by lab build-outs to support our R&D efforts. Depreciation for the quarter was $7.5 million. Receivables at the end of September were $119.5 million and the days of sales outstanding were 37 days, down from 41 days last quarter. Our ending inventory balance was $143.1 million, which increased by $3.6 million from the previous quarter. The calculated days of inventory on our balance sheet were 94 days, essentially flat with the last quarter. Now, turning to our second quarter of 2026 guidance. Our guidance is subject to the fluid macroeconomic global trade and tariff environment which continues to remain uncertain at this time. Please refer to our Safe Harbor Statement in the earnings release and in our supplemental materials. For Q2, we expect revenues to be approximately $300 million at the midpoint, plus or minus $10 million. And our guidance for the second quarter reflects an expected mix from Core IoT, Enterprise & Automotive, and Mobile Touch products of approximately 31%, 53%, and 16%, respectively. We expect non-GAAP gross margin to be 53.5% at the mid-point, plus or minus 1%. And non-GAAP operating expenses in the December quarter are expected to be $106 million at the midpoint of our guidance, plus or minus $2 million. We expect non-GAAP net interest and other expenses to be approximately $1 million and our non-GAAP tax rate to be in the range of 13-15% for the second quarter. Non-GAAP net income per diluted share is anticipated to be $1.15 per share at the mid-point plus or minus $0.15, on an estimated 40.4 million fully diluted shares. This wraps up our prepared remarks. I would like to turn the call over to the operator to start the Q&A session.

Our first question comes from the line of Ross Seymore of Deutsche Bank.

I guess my first one for Rahul is a little bit of a longer-term one. Congrats on launching the Astra platform. I know you talked about significant interest and that the revenue contribution would start kind of in the second half of next year. Could you give us any idea on the metrics that we could maybe track externally as to the success of that product, whether it be the TAM opportunity down the road or the number of design wins? Any sort of color that we could monitor as to the slope of the growth that you see coming forward with that product?

Thank you, Ross, for the question. I think we are really excited about the SL2600 series that we launched. As you can tell, from the opening remarks, we have now secured design wins way ahead of when we thought we would be getting award letters, right? Clearly, there's a very wide range of designs coming into the pipeline as a result of what we are bringing in SL2600 series products. And at this point, I'll share with you that the product is designed in such a way, it future-proofs IoT systems for multiple years, not only from having the ability to run a lot more capability because of the CPU complex as well as the multi-core processing capability, but also from an AI point of view. And we have a SKU map of pin-compatible devices that on the same PCB can be swapped for newer capable devices. And so that scale of technology that's been deployed here in this family of products is very compelling to a wide range of applications. We are seeing from home applications to industrial applications, from things like fleet management applications to robotics, lots of interest. And we have secured designs. And so when I say secured design, we've got award letters already as we sample the part. I would not be surprised if we go to production sooner than what we had planned for given the success that we are experiencing in the bring-up with the product. And given that, I would anticipate our pipeline would develop very nicely over time over the next few months. Having said that, specifically to respond to your question, at some point, we will give you an update on the pipeline in the form of the size of the funnel. And when I say size of the funnel, I would be specifically talking about designs that have been awarded to Synaptics and not the broader marketplace where people talk about the opportunity. We'll be very specific about the designs that have been awarded to Synaptics and the designs that are going into production with Synaptics through that award process. And so that is where we are going to go in terms of giving the ability to track our success with our processor line of products. I believe we are maybe a couple of quarters away from where we can start opening up and giving you that update. The intent also is to give you this update periodically, right? And so I'll keep you apprised of our progress on a going-forward basis.

And I guess as my follow-up, a little bit of a nearer-term question, perhaps for Ken or Rahul for you, if you wanted to answer. But lots of intersegment volatility versus your original expectations. The Core IoT upside significantly, the Mobile Touch downside a bit. Can you just talk about what drove those and perhaps how that applies to the guidance that you're implying for the fiscal second quarter as well?

Sure, Ross. That's a great question. In our prepared remarks, I mentioned the Mobile Touch products faced some supply constraints, which accounts for the increase from the September quarter actuals to the December quarter forecast. Looking at the Core IoT business, if we reflect on the past seven quarters, we've been averaging over 50% year-over-year growth on a quarterly basis. The strong growth in the Core IoT segment has been propelled by the factors Rahul mentioned earlier, including both processors and the connectivity business. There can be changes in customer dynamics that may affect results from quarter to quarter. However, overall, we've performed exceptionally well in terms of year-over-year growth rates, and I'm very satisfied not only with the results from September but also with our guidance for December.

Yes. To expand on what Ross mentioned, if you examine the September quarter and project from the guidance, considering both quarters, we are experiencing over 60% year-over-year growth for the first half of fiscal year '25. While there may be slight fluctuations, the growth trajectory remains strong. We are confident in our guidance of 25% to 30% growth for fiscal year '26. Analyzing all factors, our current run rate for IoT revenues has reached $400 million annually, indicating significant business expansion at a rapid pace. We are also excited about the potential impact of our newer products. Additionally, our development roadmap is progressing well. I've mentioned in my prepared remarks that we are creating a product featuring a wireless connectivity processor and AI integrated into a single chip. This innovation will be applicable across various markets, enhancing our reach due to what we have already launched and what is in our pipeline over the coming quarters.

Our next question comes from the line of Neil Young of Needham & Company.

So I just wanted to follow-up. You talked about some of those end markets that you're achieving design wins in. Specifically, are you seeing any outsized strength in any of those markets that you listed? If so, what do you think is driving that? And then on the longer-term, which end markets do you see becoming the largest? And then I have a follow-up.

Yes. I think our big area of focus right now is to tap into the existing markets. However, on a going-forward basis, as AI and the need for AI comes to the far end of the Edge, which we believe is 'in design phases in many places,' as you can tell from the AR glasses to many wearable devices to many things that you would have from home automation point of view, we see our marketplace expanding dramatically and in a place where we'll be highly differentiated. And so I'm very excited about markets where at the far end of the Edge, where AI plays a huge role for human machine interface and multimodal processing with voice, vision, and other computes for AI inference, along with industrial applications, such as robotics, humanoids. So the gamut is fairly wide open in terms of applications as we have designed our product and software platform.

And then looking into the second quarter, if you were to force rank the sequential growth across the enterprise, PC and Auto, how do you see each of those markets shaking out? And then if you could maybe talk about what's driving the strength or weakness in each of those markets.

Yes. As we consider the Enterprise, PC, and Auto markets, we do not provide specific breakdowns for those categories. However, in the Enterprise and Auto sectors, we are observing overall strength, which has shown a solid recovery on a year-over-year basis. Looking ahead to the December quarter, our guidance indicates we expect sequential growth in both the enterprise and auto sectors from September to December, reflecting positive momentum. Specifically, for September, the growth is primarily driven by the Enterprise segment, and we anticipate ongoing strength as we transition into December.

And our next question comes from the line of Christopher Rolland of Susquehanna.

Congrats on the results. I guess probably, Rahul, for you, as it comes to mobile, you guys have, I think, one major mobile player using your combo chips. But can you talk about possibilities for more, particularly handset OEMs potentially doing their own APs or elsewhere? And how possible are these opportunities for you guys?

Yes, Chris, excellent question. And you're absolutely right on the money in terms of the opportunity ahead for us in mobile. Clearly, there are many mobile phone OEMs that are going down the path of building their own apps processor, and that effectively presents an opportunity for players like ourselves who have clearly very solid wireless connectivity products to offer; however, don't have the ability to play in a 'bundle' with apps processor offering, becomes an opportunity for us with a provisioning of very differentiated market-leading wireless connectivity for phone OEMs who want to build phones and tablets and use wireless connectivity from Synaptics basically. And so we are very excited about that opportunity. We are also engaging with many OEMs in this area. I would also add, you did not ask, but very similar connectivity products can be extended to multiple other marketplaces because of the high-performance connectivity capability it brings to the table. And so there is also leverage going into high-performance set-top boxes, automotive, and other marketplaces with that level of wireless connectivity. And so there's clearly the opportunity for us to leverage our strength in wireless connectivity beyond the IoT marketplace with mobile and other places basically for wireless connectivity that's going to be high performance.

And you were speaking about your roadmap for new products in the prior question. You also mentioned Astra that you could potentially pull that in. I think it was a 2027 high-volume timetable for shipments. But I was wondering if you could update us in terms of the status on high-volume shipments for the MCU plus combo chip product you are talking about. And perhaps I think you have a broad markets MCU on your roadmap as well.

Yes, Chris, that's an excellent question, and I appreciate you bringing it up. First, regarding the two products you mentioned, we have launched a product classified as a microprocessor, which is currently with multiple customers in the sampling phase and receiving design awards. This is part of the SL2600 series, which will go into production in the second half of 2026. That's when we expect to start seeing revenue from these products. We anticipate significant momentum and revenue growth as we move from the end of 2026 into 2027 and beyond. The highly integrated MCU class processor, along with Wi-Fi 7 and Bluetooth in a single die, is expected to sample in the second half of 2026, with the earliest revenues likely appearing in the second half of 2027, and we expect that to ramp up from there. This aligns with what I mentioned in my prepared remarks. Additionally, our teams are developing the next generation of products, including a semi-custom solution aimed at a major customer, which is expected to sample in the fall. So, those are the key products we're working on, along with a few others that are in early design stages. Overall, our roadmap is progressing well with the Astra line of products and the MCU class products.

Our next question comes from the line of Kevin Cassidy of Rosenblatt Securities.

Congratulations on the great results. I would like to explore the strong growth you're experiencing in the Core IoT segment. On the wireless side, is this growth being driven by an increase in units, or is there a notable upgrade cycle resulting in a higher average selling price?

So Kevin, excellent question. On the wireless side, we are in a ramp-up phase basically. And so the contribution to the revenue is broad-based. And so it's a lot of new designs that are going into production that are contributing. So I can't tell you exactly today there is one particular market segment that's pushing the envelope more than the other. However, I do believe in 2 or 3 quarters from now, things would get to a steady place in terms of one marketplace emerging as a faster-growing segment than the other. And at this point, we'll be able to highlight where the growth is primarily coming from. But at this point, broad-based ramp-up stage, both in wireless as well as connectivity.

Yes, on the enterprise side, are you seeing any potential for a refresh cycle in docking stations? Or is the growth going to come just from PC components?

I think, Kevin, as we look at that overall enterprise space, I would expect actually both areas as we think about calendar year 2026. I think what we've talked about on previous calls, we haven't seen this year any step function in terms of PC and enterprise upgrades. It's been more steady in terms of the growth. It's been positive, but more steady. And I think that's the opportunity as we look into calendar year '26 if we see a significant upgrade cycle as a result of either Windows 10 or just the longevity of the PCs, which the last time we've had a significant upgrade was back in that '21, '22 period. So that's an opportunity for us as we think about calendar year '26.

Our next question comes from the line of Peter Peng of JPMorgan.

Congratulations on the results. The first question I have is just on expanding into outside your core consumer markets now into industrials, especially with the SL2600 launch and then also the broad markets. Maybe if you can just an update on the initiative there as you kind of build out that channel on that long tail of customers.

Thank you for the question, Peter. I appreciate it. We recently uploaded some demonstrations from our Tech Day to our YouTube channel, which just went live yesterday. I encourage you to check them out. You will find several industrial applications featuring our processors, such as a robotic arm created by a partner that incorporates our touch controller and multiple instances of it. The arm uses our Astra processor and includes wireless connectivity. This showcases the potential of our products. As I mentioned in the last quarterly call, our analog mixed-signal capabilities, combined with connectivity and processing for AI inference, provide a comprehensive solution from human-machine interfaces to processing. This was highlighted during our Tech Day demo, which is also available as a video on our YouTube, along with multiple other demonstrations, including fleet management using our Astra processors. It's important to note that consumer markets tend to grow much faster than industrial ones. We anticipate that industrial applications will take longer to ramp up in our IoT business compared to the quicker growth and quicker refresh cycles seen in consumer markets. We are actively developing our product line and engaging with customers to build solutions for industrial applications, but significant designs for industrial will take somewhat longer compared to consumer markets.

There's a lot of optimism surrounding smart glasses. Can you discuss your engagement in this area and the types of content opportunities you expect to have?

Yes. I think I really don't want to kind of tip a whole lot on this topic, but you are touching a sweet spot for Synaptics' Astra line of products on a going-forward basis. With the product capabilities that I described earlier in the earlier question, clearly, the scale at which the volume needs to experience economic value is out there to be delivered by a solution supplier like Synaptics. And that in itself is a huge opportunity for us that we have our eyes set on in not just AR glasses, but also many variable opportunities on a going-forward basis. The combination of general-purpose CPU with the optimal GPU, with the optimal audio processor, with the optimal vision processor and all working with a newer processor embedded. And also, like I said in my prepared remarks, taking the Coral NPU, open-source Coral NPU made available by Google, collaborating with Google to build out that system in the Astra 2600 series is an indication of exactly where we could be going for the variable sets of applications, AR glasses being one of them. And we are really excited about that opportunity, largely because the economic value equations that get addressed through Astra line of products is today up for grabs basically in the marketplace.

Our next question comes from the line of Robert Mertens of TD Cowen.

This is Robert Mertens on the line for Krish Sankar. I guess, just the first one, I know we talked a lot about your strategy going into Edge AI applications. But are there any core technologies that you think you need to develop either in-house or small tuck-in acquisitions or working with partners to bring into your Edge AI portfolio to be more attractive to the broader customer base, whether it's ultra-low power processing side or integration of your connectivity suite. Just anything there would be really helpful.

Yes, Robert, excellent question. I think our strategy has been largely to enable best-in-class solutions for our customers. And in many situations, it would mean that we would provide a total solution. In some situations, it would mean that we may provide a processor, and the customer may choose some other components to build out the solution. And so we are fairly open in our engagement with our customers. Having said that, the biggest differentiation in our processor strategy is to not go down this path of building out walled gardens. We are a firm believer in open-source. Our software development platforms support multiple open-source communities. Our ability to enable our customers to work with the vast ecosystem of models that are being developed for various applications in the form of AI inference capabilities is to enable them to bring those to our platforms much more easily and with very little effort from Synaptics' team. And so, this is our strategy to operate at scale. And this strategy is developed in combination with Google Research. And so here, you have a company that also believes in open-source and enabling the software ecosystem, supporting the Synaptics approach in the bigger picture. And so that is how we are differentiating ourselves versus some of the peer set in the marketplace that have gone down this path of owning software development platforms. And effectively, in our opinion, it holds us back from scaling faster and enabling our customer base and the developer community as a result. And so that is our largest strategy. Having said that, we are always going to be on the lookout for opportunities to inorganically fuel our growth in IoT. And that option is definitely on the table.

If I could just have one final question. Sorry about that. Just real quick, looking into your Enterprise and Automotive business, I know you've mentioned that the channel inventories have been improving over the last couple of quarters. Backlog levels seem to be normalizing. So just in that framework, what sort of other signs of improvement on a quarterly basis do you see there? I know you expected to rebound a bit into the December quarter. Is that something you expect to continue through the beginning of next year? Or is that more just pull-ins from various projects?

So I would say, overall, if you looked at the Enterprise and Automotive segment, within that, the Enterprise segment has done better over the last years; it has continued to improve. I think automotive has been more sluggish, but the enterprise piece has really performed nicely over the last 12 months or so. And I think as we think about and look forward into calendar year '26, which is not too far away, the one other opportunity that's out there is around some of the upgrade cycles and not only for the PCs but as you think about RTO activities and the like and as people refresh the workstations, those are great opportunities for Synaptics as well. So we're excited about that business in terms of the share that we have and the franchise positions we have, and there's some great opportunities ahead of us as we think about 2026.

To build on what Ken mentioned, in the Enterprise segment, we are increasing our market share in the PC business, even though the overall market is mostly flat with GDP-like growth. Our success is largely due to gaining share, which stems from our strong analog mixed-signal capabilities. We are performing well compared to our competitors in the market, and this is particularly evident in our Mobile Touch division. As I noted earlier, our next-generation product, set to launch in the second half of 2026, highlights the uniqueness of our analog mixed-signal capabilities, especially in the touch area. We are committed to investing wisely and releasing high-quality products that are boosting the total silicon content in phones. I am very optimistic about the potential of this business in the latter half of 2026 and beyond.

I'm showing no further questions at this time. I'll now turn it back to President and CEO, Rahul Patel, for closing remarks.

Before we conclude, I would like to reiterate that the Synaptics team executed very well this quarter. We strengthened our leadership position in Edge AI with the launch of our new generation of AI-native Astra processors, and we continue to innovate on the next-generation of processors, wireless connectivity, and mixed-signal products and solutions planned for delivery in calendar 2026 and beyond. Our financial results reflect our ongoing commitment to disciplined execution. I want to thank all my teammates in engineering and across Synaptics for their dedication and hard work in delivering on our commitments. Equally importantly, I would like to thank all our shareholders for their continued support of Synaptics. I look forward to connecting with many of you at upcoming industry events and conferences. Have a great rest of the day.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.