Earnings Call Transcript - SYNA Q4 2025

Operator, Operator

Hello, and welcome to Synaptics' Fourth Quarter Fiscal Year 2025 Financial Results Conference Call. Please be advised that today's conference is being recorded. It is now my pleasure to introduce Munjal Shah, Vice President, Investor Relations.

Munjal Shah, Vice President, Investor Relations

Good afternoon, and thank you for joining us today on Synaptics' Fourth Quarter and Fiscal 2025 Conference Call. My name is Munjal Shah, and I am 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 at synaptics.com. In addition to a copy of our earnings press release detailing our quarterly results, a supplemental slide presentation and a copy of the 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. Please refer to our earnings press release for a reconciliation of the most directly comparable GAAP financial measures to the non-GAAP financial measures presented. 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 these 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 and 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 or the date specified on the call. 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.

Rahul G. Patel, President and CEO

Thank you, Munjal. Good afternoon, everyone, and thank you for joining our fiscal Q4 2025 earnings call. I am excited to speak with you today. I will start with a brief introduction, outline my initial observations and discuss strategic updates for the company. I will then cover highlights from our fourth quarter and turn the call over to Ken for financial results and guidance. I have spent three decades driving growth in the semiconductor industry, including more than 20 years in senior leadership roles at Qualcomm and Broadcom. At Qualcomm, I led the IoT business, scaling it from under $1 billion to multibillion dollars. This success was built on delivering highly differentiated products and a compelling technology roadmap, strategically positioning the business for sustained growth, market leadership, and enduring customer relationships. I am energized by the opportunity to scale Synaptics into a much larger and differentiated Core IoT and Edge AI semiconductor solutions player. In the past two months, I have engaged closely with customers, partners, suppliers, and our employees to better understand our strengths and opportunities. Synaptics has a strong foundation in analog mixed signal, multi-core processors, and wireless connectivity intellectual property. I believe that the combination of these three capabilities uniquely positions the company in Core IoT to deliver long-term value for our stakeholders. Our engineering talent, technology portfolio, roadmap of differentiated products and solutions, and customer intimacy position us well for leadership and growth. We are leveraging our strong foundation to accelerate growth in Core IoT, investing strategically in engineering, sharpening our go-to-market execution, and delivering innovative, scalable platforms that align with our customers' need for performance, integration, and flexibility. From industrial automation to smart home applications, Synaptics is uniquely positioned to capitalize on a vast emerging opportunity. With unmatched capabilities in sensing, processing, and connectivity, we are driving differentiated solutions in Core IoT and Edge AI. From my vantage point, our priorities are clear. We plan to actively pursue opportunities to expand our share in our existing markets and explore new ones with the goal of accelerating growth in our Core IoT business. We will continue evaluating our product portfolio and shape our products and solutions roadmap that we believe will position us for sustained success over the medium and long term. We expect to maintain a disciplined execution strategy that prioritizes investments in areas that offer the highest potential for sustained and profitable growth. We look forward to providing more details at Synaptics' Analyst Day in 2026. Moving to our results and business update, we just completed our fiscal year 2025 with revenue increasing 12% to $1.074 billion. This growth was driven by strong performance of our Core IoT products, which grew 53% year-over-year and accounted for approximately one-quarter of total company sales. As we enter fiscal 2026, we continue to focus on driving top line growth and increasing earnings while also continuing to invest in our growth initiatives. For our fiscal fourth quarter, which ended in June 2025, revenue was $282.8 million, slightly above the midpoint of our guidance and up 14% year-over-year. Non-GAAP gross margin was 53.5%, in line with the midpoint of our guidance, and non-GAAP EPS of $1.01 increased 58% year-over-year and was also in line with the midpoint of our guidance. Our Core IoT product sales increased 55% year-over-year in fiscal Q4 to $84 million, fueled by a strong contribution from our wireless portfolio. As we look to the future, our new Synaptics Wi-Fi 7 solutions introduced last quarter are gaining meaningful traction, offering a range of products from high performance to low-power capabilities. We see design opportunities across a wide range of customers for IoT, enterprise and automotive applications. These designs are expected to ramp throughout 2026 and beyond as customers launch their next generation of products. We have confidence that Synaptics is well positioned to gain market share during the Wi-Fi 7 technology transition. Moving on to our portfolio of processors, the team has done an excellent job taping out our latest Edge AI native Astra processors. This new portfolio integrates a neural processor co-developed with Google Research, which supports transformer-based architecture. This enables native execution of generative AI applications at the edge to support text, video, vision, audio and predictive maintenance workloads. It supports both current AI use cases and emerging AI models across a broad range of IoT applications and delivers high performance and low power consumption at truly disruptive price points. We believe the tight integration with our market-leading wireless connectivity solutions enables our customers to implement differentiated and affordable end applications. We are making great progress with lead customers and engineering samples are expected this quarter. We expect initial revenue contributions to start in the second half of calendar 2026. While we are seeing strong momentum in product development, design wins, and pipeline expansion for our new platforms, our existing processor products are also gaining traction, benefiting from demand recovery and normalized inventories. We continue to see our design wins ramping into various deployments at key customers in 2026. We have secured a marquee win with a leading audio OEM. They chose us because of our ability to provide Edge AI-ready silicon, comprehensive software, robust connectivity, broad IoT ecosystem support, and hardware security. Overall, our Core IoT pipeline continues to grow and gain momentum. Turning to Enterprise & Automotive, we continue to see modest recovery across our Enterprise portfolio. While order trends are improving, we are not seeing a broad-based PC refresh cycle just yet. In Automotive, demand remained soft, in line with the market segment. While we do not anticipate a material near-term recovery, we remain confident in the long-term potential driven by our innovative video display bridge solutions and adoption of OLED screens. Finally, Mobile Touch performed better than our initial expectations and delivered solid sequential growth. Our portfolio is primarily targeted at the high-end Android smartphone market, where we saw healthy demand across multiple customers. We are seeing strong traction for our latest touch architecture designed for foldable phones and other large screen applications. We are optimistic about the opportunity as the share of foldable phones continues to grow. We continue to collaborate with multiple OEMs for their current and next-gen designs. Overall, business continues to improve as orders are steadily increasing, the backlog is growing, and channel inventories remain lean. Our pipeline of opportunities continues to expand, and we remain confident in our ability to maintain our position in Enterprise & Automotive, Mobile Touch, and drive long-term growth in Core IoT. With disciplined execution, we expect to deliver sustainable growth across our portfolio and create long-term shareholder value. In my time here so far, I have focused on deepening connections with our employees, customers, suppliers, and partners. I'm now looking forward to building strong partnerships with our analysts and investors. We plan to be on the road in the coming weeks, and I hope to meet several of you in person. I will turn the call over to Ken to review our fourth quarter fiscal year 2025 financial results and our fiscal 2026 first quarter outlook.

Ken Rizvi, CFO

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. Let me start with our full year fiscal 2025 results. We had strong growth in fiscal 2025, with revenues increasing 12% to $1.074 billion, and earnings per share increasing by 61% to $3.62. Our growth was mainly driven by our Core IoT products, which increased 53% for the year. We also saw a recovery in our Enterprise & Automotive products, which increased by 7%. During fiscal 2025, our revenue trends continued to improve, and channel inventories have been reduced to normalized levels. Non-GAAP gross margin for fiscal 2025 came in at 53.6%. Non-GAAP net income for fiscal year 2025 was $143.9 million or $3.62 per diluted share. We continue to generate strong cash flow, with fiscal year 2025 cash from operations of $142 million. During the year, we reduced total gross debt by approximately $134 million or 14%, repurchased shares of our common stock totaling $128 million, and invested approximately $200 million to acquire certain assets from Broadcom in January, enhancing the capabilities in our Core IoT portfolio. Now let me turn to our Q4 results. Revenue for fiscal Q4 was $282.8 million, above the midpoint of our guidance. Q4 revenues were up 14% on a year-over-year basis and 6% sequentially. The revenue mix in the fourth quarter was as follows: 30% Core IoT, 53% Enterprise & Automotive, and 17% Mobile Touch products. Core IoT product revenues increased 55% year-over-year and 25% sequentially, driven primarily by increased demand for our wireless products. Enterprise & Automotive product revenues improved 4% year-over-year but were down 3% sequentially, mainly due to continued softness in automotive. Mobile Touch product revenues were higher than expected, increasing 8% sequentially and were roughly flat on a year-over-year basis. Fourth quarter non-GAAP gross margin was 53.5%, in line with the midpoint of our guidance. Fourth quarter non-GAAP operating expense was $104.5 million, slightly above the midpoint of our guidance range, mainly due to the foreign exchange impact from a weakening U.S. dollar. We estimate this impact for fourth quarter expense was approximately $2 million. Our non-GAAP operating margin was 16.5%, up approximately 208 basis points on a year-over-year basis and 95 basis points sequentially. Non-GAAP net income in Q4 was $39.5 million. Non-GAAP EPS per diluted share came in above the midpoint of our guidance at $1.01 per share, an increase of 58% on a year-over-year basis. Now let me turn to the balance sheet. We ended the fiscal fourth quarter with approximately $452.5 million in cash, cash equivalents and short-term investments, up approximately $31.1 million from the prior quarter. Cash flow from operations was $57 million in the fiscal fourth quarter, and we repurchased $16 million of our shares in Q4. Our existing share repurchase authorization expired in July of 2025. On August 5, 2025, our Board of Directors authorized a new repurchase program for up to $150 million of our common stock. This new authorization underscores the Board's confidence in our long-term strategy and reflects our continued commitment to delivering shareholder value. We remain disciplined in our capital allocation approach, balancing strategic investments in growth with opportunistic share repurchases. Capital expenditures were $6.6 million, and depreciation for the quarter was $7.1 million. For fiscal year 2025, total capital expenditure was $25.8 million and total depreciation was $28.9 million. Receivables at the end of June were $130.3 million, and days of sale outstanding were 41 days, down from 45 days last quarter. Our ending inventory balance was $139.5 million, which increased by $6.6 million from the previous quarter. The calculated days of inventory on our balance sheet were 95 days, essentially flat with last quarter. Now turning to our first quarter of 2026 guidance. I want to first note that our guidance is subject to the fluid macroeconomic, global trade and tariff environment, which remains uncertain at this time. Please refer to our safe harbor statement in the earnings release and in our supplemental materials. For Q1, we expect revenues to be approximately $290 million at the midpoint, plus or minus $10 million. Our guidance in the first quarter reflects an expected revenue mix from Core IoT, Enterprise & Automotive, and Mobile Touch products of approximately 32%, 53%, and 15%, respectively. We expect non-GAAP gross margin to be 53.5% at the midpoint, plus or minus 1%. Non-GAAP operating expenses in the September quarter are expected to be $105 million at the midpoint of our guidance, plus or minus $2 million. We also expect non-GAAP net interest and other expenses to be in the range of $1 million to $2 million in the first quarter, and our non-GAAP tax rate to be in the range of 13% to 15% for the first quarter and for fiscal 2026. Non-GAAP net income per diluted share is anticipated to be $1.05 per share at the midpoint, plus or minus $0.15 on an estimated 39.5 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.

Operator, Operator

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

Kevin Edward Cassidy, Analyst

Congratulations on the great results. And welcome, Rahul. And my question is for Rahul. I'm certain at the Analyst Day, you'll go into more details, but you had great success in the IoT market at Qualcomm. And I just want to know how this strategy might change as you come to the Synaptics platform?

Rahul G. Patel, President and CEO

Thank you, Kevin, and thanks for the question. Clearly, I think, as I indicated in my prepared remarks, I'm really excited by what I see in our portfolio at Synaptics and the opportunity to roadmap it further into something that's going to be an even more formidable offering. If you look at the building blocks in most of the IoT systems, you would have a processor, some form of wireless connectivity, and some natural interface or interface with the physical world, which would be largely mixed signal. These three components are exactly where Synaptics is in its core capabilities right now. Mixed signal has been the core competence of the company for almost four decades. It has been consistently delivering best-in-class signal-to-noise ratio solutions, particularly in Mobile Touch for a long time and in many other areas. Second, in processors, we have a solid presence already in the processor market. And with this Google Research partnership, we are bringing AI at the Edge by implementing not only the neural processing engine but also in collaboration with Google, the accelerators that facilitate efficient AI inference, alongside every other co-processor engine available in the subsystem and then wireless connectivity. We have a portfolio of intellectual property as well as capabilities that come from being the best in the marketplace, especially from Broadcom. These are being integrated into products that will ultimately deliver not only high performance but also extremely low-power applications, thereby creating solutions that provide efficient battery life and an extended days of use. So you can see the opportunity here is going beyond selling piecemeal solutions as processors or wireless connectivity or mixed signal capabilities into holistic solutions going forward. You will see a lot more of these discussions come to the forefront as we move into 2026 with Synaptics. This creates an opportunity to add much more silicon content into the end product at the customer and also combine it with the right software capabilities, AI model capabilities and potentially help us to grow gross margin from where it is right now and towards our long-term models. As you can tell, I'm truly excited about the opportunity ahead in Core IoT for the portfolio that Synaptics has to offer today and to grow from there into the roadmap products that we have planned.

Kevin Edward Cassidy, Analyst

That's great color. And maybe just one other is, are there other building blocks you might need to acquire to fill out the whole solution, maybe some other types of connectivity aside from the wireless connectivity?

Rahul G. Patel, President and CEO

Kevin, that's an excellent question again. I believe our philosophy—and mine throughout my career—has been to remain very disciplined financially and not get carried away. These thoughts are common to Ken as well in how he views the business and our investments. Clearly, we have an organic portfolio that can grow. From an investment perspective, our first priority will be organic investments where we can continue to develop products and create a roadmap that is highly differentiated. I am confident that we will continue to deliver differentiated products based on everything that we have in our portfolio going forward. While I won't rule out inorganic opportunities to accelerate our growth in Core IoT, we will certainly do the right thing from a capital allocation perspective if we have surplus capital and will look for ways to return it to shareholders. So, to summarize: we have a lot to do organically, a reasonable operational expenditure envelope to work with, and we will not shy away from considering inorganic options if they help us accelerate growth in Core IoT.

Operator, Operator

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

Christopher Adam Jackson Rolland, Analyst

Perhaps following on Kevin's. So welcome, Rahul. My questions are going to be a little bit more targeted. So have you identified some areas of perhaps product pruning or low ROI investments? And then alternatively, have you found you might have some areas of pricing power or pricing optimization that you may be able to implement? And then lastly, Synaptics has historically not had a great channel presence. Have you thought about how to beef that up?

Rahul G. Patel, President and CEO

Chris, great questions. Thank you. First and foremost, absolutely. During my first couple of months here, I have looked at every potential product category that we are in. I have established a good understanding of their value propositions and how they fit into the larger drive for the company to be a formidable player in Core IoT. I can share that I have early views on what we should focus on and what we may deemphasize in the future. However, I promise that by Analyst Day, I will present a clear direction on our focus areas and any potential areas to divest. That being said, I'm really excited about the engineering talent we have in-house. While we will make some choices, I believe we will need some of our engineering talent to be repurposed into areas that will drive growth in Core IoT. In terms of our channel strategy, our products have recently started to ramp into customers. We are trying to grow from around 10-15 customers to 100 customers. I foresee that we will soon move towards 1,000 customers and beyond. We have established a timeline for when we will start investing in our channel strategy. It is important to formulate this strategy carefully, and I aim to be very judicious about the timing of our investments.

Ken Rizvi, CFO

And Chris, just to add on, if you look at our sales team and go-to-market engine, that is an area we have been investing in over the last six to twelve months, and we will continue to invest in that area as we think about our fiscal '26 in terms of business development, system architects and the like, to develop differentiated products and solutions for that customer set.

Rahul G. Patel, President and CEO

To build upon what Ken is saying, I believe that focusing on selling solutions effectively will also enhance our total silicon content for every sales effort. This will help in increasing our sales efficiency, proving beneficial as we scale our efforts.

Christopher Adam Jackson Rolland, Analyst

Excellent. And then this one is probably for you, Ken. In the prepared remarks, you noted order activity, backlog, and channel inventory levels have improved. Could you talk a little more about that order activity, such as the percentage of book versus turn that you need, backlog, and any metrics like book-to-bill, etc.? Also, when you indicate that channel inventory levels have improved—does that mean that channel inventories have decreased or increased?

Ken Rizvi, CFO

Sure, Chris. Let me know if I don't answer everything. Regarding order activity, we've mentioned in previous quarters that overall order activity and backlog entering the quarter have improved. We have great visibility into our September quarter, our Q1, and the backlog is healthy and continuing to build as we look into Q2. I think these are good trends, and we measure them regularly. In terms of the channel, we have very lean channel inventories as a company, reaching pre-COVID levels. In Q4, our channel inventory slightly decreased from Q3 levels, but overall, we are very lean. So as demand trends improve, I would expect our channel inventory will replenish to normal levels, although we're not forecasting that for our September outlook.

Operator, Operator

And our next question comes from the line of Krish Sankar with TD Cowen.

Krish Sankar, Analyst

Welcome, Rahul. And Ken, first one for you, just to follow up on the previous question. With channel inventory getting lower and backlog improving, how sustainable is this given the fact that IT spending budgets are still very tepid? How should we think about December or March quarter revenue trends overlaying any kind of seasonality we should expect?

Ken Rizvi, CFO

Sure, Chris. Good question. We typically have visibility 3 to 6 months, and within that 3-month window, we often have fairly healthy visibility. As we consider the September quarter, we're guiding to approximately $290 million at the midpoint, and you can assume we have pretty good line of sight to that midpoint and the range around it. As we consider December, our visibility is improving, and the backlog levels starting from this period and looking into December look healthy. However, it's a bit too early to call for the March quarter. Generally, there is some seasonality in the business, especially within consumer-oriented markets. Historically, we would expect some seasonality in the March quarter, although we are not guiding for that today.

Krish Sankar, Analyst

Super helpful, Ken. As a follow-up for Rahul, I understand you'll present more about your strategy at the Analyst Day. Synaptics historically has not had strength in industrial IoT. Do you think it is worth pursuing as a segment, or is it tough to gain traction organically or might it require an acquisition?

Rahul G. Patel, President and CEO

Yes. Krish, first and foremost, thank you for welcoming me. Regarding your question, I want to highlight our mixed-signal analog capabilities combined with AI at the processor level. This leads to applications like factory control, process control, charging infrastructure, EV charging infrastructure, point-of-sale scanners, drones, and robotics, which scale into industrial IoT. So we will build platforms that can scale across the entire opportunity from industrial IoT to consumer IoT. I believe we can achieve significant traction based on the capabilities we currently possess, particularly in our processors, which range from high-performance microprocessors to value-oriented microcontrollers.

Operator, Operator

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

Kaykin Peng, Analyst

Welcome, Rahul. When you assess your three business segments, where do you see potential prioritization? How do you perceive Synaptics is progressing towards its transformation journey to an IoT company? Is divestiture something that you're contemplating?

Rahul G. Patel, President and CEO

Thank you, Peter, for the welcome. To address your last question first, I am conducting a comprehensive review of all assets and product categories within Synaptics. I'm diligent in evaluating the engineering capabilities associated with every category. While there may be deemphasis on certain product categories, our core engineering capabilities remain highly valuable and will be repurposed as necessary to support the growth of Core IoT. As for clarifying the categories of products that will remain or be deemed non-essential, I will provide more clarity at the Analyst Day.

Kaykin Peng, Analyst

Got it. And a more near-term question—are there signs of demand pull-forward? In light of your comments on typical seasonality in March, what does that look like for you?

Ken Rizvi, CFO

Yes. Peter, regarding seasonality, historically, we would typically see a decline in the March quarter due to consumer applications. While we are not calling or guiding for that today, it is reasonable to anticipate a seasonally lower performance in the March quarter given those factors. Regarding demand pull-ins, it can be challenging to categorize demand accurately. We've seen strong demand in our fiscal Q4 and there are globally-based incentives that may have contributed to this boost. However, it is challenging to segregate pull-ahead from regular demand trends; we have guided mobile to be down slightly for Q1. Demand recovery has been observed across other areas as well.

Rahul G. Patel, President and CEO

To add to Ken's point, despite a sequential decline in mobile relative to Q4, the overall revenue continues to grow in fiscal Q1 primarily driven by growth in Core IoT, which is expected to grow over 50% year-over-year. Therefore, our focus on new products and segments is contributing to sequential growth in Q1, mitigating what could be a weak fiscal period for Mobile Touch.

Operator, Operator

And our final question comes from the line of Jacob Grandstaff with Mizuho.

Jacob Daniel Grandstaff, Analyst

This is Jacob on for Vijay at Mizuho. Rahul, welcome as well. First one is going to be on margins. You guided it flat quarter-over-quarter, which would be the third straight quarter with GMs at about 53.5%. At the last Analyst Day, you guys targeted 57% for margins. Can you walk us through the puts and takes to get back into that high 50% range? Would that just be an acceleration of Enterprise & Auto? Or are there other factors to consider for reaching that goal?

Ken Rizvi, CFO

Thank you for the question. As we think about our margin profile, several factors contribute to our current position. We've executed well over the last few quarters; our margin results have translated into positive earnings. When considering our margin profile, it largely depends on the product mix we offer and the shifts in that mix over time. To improve margins, it involves a combination of enhancing our product differentiation and optimizing our offerings.

Rahul G. Patel, President and CEO

To build on what Ken mentioned, I referred to the new Astra product launches, especially within Edge AI. Our collaboration with Google Research—integrating neural processing and transformer support—positions us favorably for margin enhancement as we see the mix shifting increasingly towards our processors and wireless solutions. So, I believe we have the capability to drive margin growth in the long term, and we will provide further updates at the Analyst Day.

Jacob Daniel Grandstaff, Analyst

Awesome. I appreciate the color, and that's a good segue into my second one. I wanted to ask about Astra. Last quarter, Ken mentioned a $300 million incremental design funnel from Astra. Could you update us on what that looks like now and how quickly you think you can ramp wins? You mentioned revenue starting to come in the second half of '26.

Ken Rizvi, CFO

Yes. Regarding the design funnel, the number I provided last quarter referenced the September quarter of last year. The funnel continues to expand nicely, and we typically provide an annual update. You can expect more details either on our next earnings call or during the Analyst Day. Progress is promising, and customer excitement is growing regarding the new Astra processor capabilities. We anticipate solid traction as we move forward.

Rahul G. Patel, President and CEO

I am optimistic about our long-term growth projections within the Core IoT market segment right now. We expect to provide further specifics on this growth trajectory during upcoming calls.

Operator, Operator

And our final question comes from the line of Nick Doyle with Needham & Company.

Nicolas Emilio Doyle, Analyst

Also welcome, Rahul. Congrats on a successful Astra tape-out. I think that was executed a bit ahead of expectations. About that Core IoT audio OEM marquee win, can you expand on that win? What allowed you to win so quickly after the first tape-out? What does that audio customer need that you're offering? What other short-term opportunities do you see for that Astra SoC?

Rahul G. Patel, President and CEO

Nick, first and foremost, thank you. To clarify, the chip that was taped out was done ahead of schedule. Congratulations to our engineering team for their execution. However, the design win with the audio OEM was based on a predecessor chip that included elements of AI processing through our audio processor capabilities. I must be careful not to disclose too much information about our end customer, but they are a leading brand in North America, known for high-end speaker systems and wireless connectivity. This chip facilitates synchronization of audio quality without compromising fidelity, thanks to the AI capabilities we offer in this equation of audio synchronization at high fidelity levels. When the right time comes, we will share more details about this exciting development. Regarding opportunities for Astra in the near term, the majority of the growth stems from the wireless and Wi-Fi 7 sectors, where we have seen significant demand for our new processors.

Operator, Operator

And I'm showing no further questions, so with that, I'll hand the call back over to President and CEO, Rahul Patel, for any closing remarks.

Rahul G. Patel, President and CEO

Thank you, Andrew. Before we conclude, I would like to reiterate that I am confident in our path forward as Synaptics stands at the forefront of Core IoT and Edge AI innovation. I want to express my sincere gratitude to all our employees for their unwavering dedication, and to our customers, partners, and shareholders for their continued support and trust in us. Thank you very much.

Operator, Operator

Ladies and gentlemen, thank you for participating. This does conclude today's program, and you may now disconnect.