Good day, everyone, and welcome to the TTM Technologies Second Quarter 2022 Financial Results Conference Call. Sameer Desai, TTM's Vice President of Corporate Development and Investor Relations, will now review TTM's disclosure statement. Please go ahead.

Thank you, April. Before we get started, I would like to remind everyone that today's call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to TTM's future business outlook. Actual results could differ materially from these forward-looking statements due to one or more risks and uncertainties, including the factors explained in our most recent Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. These forward-looking statements are based on management's expectations and assumptions as of the date of this presentation. TTM does not undertake any obligation to publicly update or revise any of these statements, whether as a result of new information, future events, or other circumstances, except as required by law. Please refer to the disclosures regarding the risks that may affect TTM, which may be found in the reports on Form 10-K, 10-Q, 8-K, the registration statement on Form S-4, and the company's other SEC filings. We will also discuss on this call certain non-GAAP financial measures such as adjusted EBITDA. Such measures should not be considered as a substitute for the measures prepared and presented in accordance with GAAP, and we direct you to the reconciliation of non-GAAP to GAAP measures included in the company's press release, which was filed with the SEC and is available on TTM's website at www.ttm.com. We have also posted on our website a slide deck that we will refer to during our call. I would now like to turn the call over to Tom Edman, TTM's Chief Executive Officer. Please go ahead sir.

Thank you, Sameer. Good afternoon, and thank you for joining us for our second quarter fiscal year 2022 conference call. I'll begin with a review of our business highlights from the quarter and a discussion of our second quarter results, followed by a summary of our business strategy. Todd Schull, our CFO, will follow with an overview of our Q2 2022 financial performance and our Q3 2022 guidance. We will then open the call to your questions. The quarter's highlights are also shown on Slide 3 of the investor presentation posted on TTM's website. In the second quarter of 2022, TTM delivered an outstanding quarter with revenues and non-GAAP EPS above the high end of guidance despite a challenging supply chain and labor environment and the continued impact that COVID-19 is having on our business. Revenues were up 10.3% year-on-year, the second consecutive quarter of double-digit growth as our commercial markets drove the year-on-year increase. We saw a significant jump in our profit margins in Q2 as many of the cost headwinds that we have faced over the past year turned into tailwinds. Specifically, we saw improved product mix globally, favorable foreign exchange rates as the Chinese RMB weakened against the dollar, lower metal prices and improved productivity in North America. We also enjoyed very strong levels of quick-turn business that contributed to our profitability. I am extremely proud of our employees for delivering outstanding results this quarter. We had previously discussed pay adjustments that we made in the first quarter of this year in North America to increase our competitiveness. Since then, we have seen a general improvement in our ability to attract and retain talent, though the labor market is still tight in specific regions. The price increases that will offset these higher compensation costs are still anticipated to have a positive impact on our margins through the balance of the year. We expect that the elevated high margin quick-turn business, realized in Q2, will normalize in Q3 and will offset the margin improvements from price increases on a sequential basis. However, our margins are expected to be up on a year-on-year basis. Finally, I would like to mention that TTM published our first corporate social responsibility report or CSR, and it is available on our website on the Sustainability page under the About TTM section. The report highlights TTM's commitment to CSR and the environmental, social and governance or ESG initiatives that are an integral part of the way we do business. I would now like to provide a strategic update. TTM is on a journey to transform our business to be less cyclical and more differentiated. As part of this strategic transition, near the end of the second quarter, we closed the acquisition of Telephonics. Over the past several years, TTM has consistently emphasized that a key part of our strategy is to add value to the product solutions that we deliver to our customers, particularly in the aerospace and defense market. In 2018, we acquired Anaren, which broadened TTM's product portfolio into highly engineered RF components and subassemblies as well as adding critical RF engineering capability and resources. Telephonics builds on Anaren and TTM's customer-driven culture and disciplined approach to engineering and manufacturing by further broadening TTM's aerospace and defense product offering vertically into higher-level engineered system solutions and horizontally into the surveillance and communications markets, while strengthening our position in radar systems. Going forward, the aerospace and defense end market will be approximately 40% of revenues, which will provide growth and stability in a potentially uncertain demand environment for commercial markets. In addition, over 50% of A&D revenues will be from engineered and integrated electronic products with PCBs being less than 50% of the overall contribution. Finally, the transaction will be immediately accretive to EPS. Adding another element of our differentiation strategy, on April 28, we broke ground on a new state-of-the-art, highly automated PCB manufacturing facility in Penang, Malaysia. The decision to build this new factory is a direct response to our customers’ increasing concerns about supply chain resiliency and regional diversification, and in particular, the need for advanced multi-layer PCB sourcing options in locations outside of China. The new facility in Malaysia will assist customers in our commercial markets, such as networking and telecom, data center computing and medical, industrial and instrumentation. Lastly, I would like to update you on our COVID situation. Earlier this year, COVID-19 impacted our employee base with increased cases in North America. However, this was meaningfully reduced in the second quarter, which contributed to our increased productivity. In Asia Pacific, we saw COVID-related disruptions in one of our smaller facilities in Shanghai, but this was more than offset by stronger growth from our larger facilities in Southern China. We understand COVID cases are growing again in China and North America and we are closely monitoring the situation and will adjust our protocols accordingly. Now I'd like to review our end markets, which are referenced on Page 4 of the investor presentation on our website. The aerospace and defense end market represented 30% of total second quarter sales compared to 33% of Q2 2021 sales and 30% of sales in Q1 2022. This market performed better than our expectations and we continue to experience a positive defense climate, with our A&D program backlog at $737 million, excluding Telephonics compared to $671 million a year ago. With Telephonics included, our program backlog is $1.04 billion. The solid demand in our defense market is a result of a positive tailwind in defense budgets and our strong strategic program alignment and key bookings for ongoing franchise programs. During the quarter, we saw significant bookings for several programs, including the Joint Strike Fighter and other space and airborne programs. We expect sales in Q3 from this end market to represent about 39% of our total sales, including a full quarter of Telephonics as the acquisition closed near the end of our second quarter. The medical, industrial, instrumentation end market contributed 21% of our total sales in the second quarter compared to 19% in the year ago quarter and 21% in the first quarter of 2022. The MI&I market set a new quarterly record, as it was up 27% year-on-year, exceeding $100 million in revenue for the fifth quarter in a row and performing much better than expected with broad-based strength across all segments. For the third quarter, we expect MI&I to be 17% of revenues as the elevated quick-turn business in Q2 normalizes in Q3 and select customers face component shortages. Due to the strength in this market year-to-date, we expect this market will be above the long-term third-party projections of 2% to 4%, which is better than the in-line growth rate expectations we had at the start of the year. Automotive sales represented 18% of total sales during the second quarter of 2022 compared to 18% in the year ago quarter and 20% during the first quarter of 2022. Automotive grew 8.6% year-over-year and exceeded $100 million for the third quarter in a row. We continue to see year-on-year growth for automotive PCBs, despite the combined impact of supply chain and demand disruptions caused by COVID, the Ukraine-Russia conflict and semiconductor shortages that are all impacting automotive OEM production. However, growth rates are moderating somewhat and we expect our automotive PCB business to contribute 16% of total sales in Q3. Sales in the data center computing end market represented 17% of total sales in the second quarter compared to 14% in Q2 of 2021 and 16% in the first quarter of 2022. This end market was up 29% year-on-year, due primarily to growth from our data center customers. We expect revenues in this end market to represent approximately 15% of third quarter sales as strong data center demand continues to drive year-on-year growth. Networking, communications accounted for 14% of revenue during the second quarter of 2022. This compares to 15% in the second quarter of 2021 and 13% of revenue in the first quarter of 2022. We saw relative strength on a year-on-year basis in networking as compared to telecom as we continue to allocate capacity for high layer count boards to our data center computing and networking customers. In Q3, we expect this end market to be 13% of revenue. Next I'll cover some details from the second quarter. This information is also available on Page 5 of our earnings presentation. During the quarter, our advanced technology and engineered products business, which includes HDI, rigid flex and RF subsystems and components, accounted for approximately 33% of our revenue. This compares to approximately 31% in the year ago quarter and 33% in Q1. We are continuing to pursue new business opportunities and increase customer design engagement activities that will leverage our advanced technology and engineered products capabilities in new programs and new markets. Capacity utilization in Asia Pacific was 88% in Q2 compared to 88% in the year ago quarter and 85% in Q1. Our overall capacity utilization in North America was 42% in Q2 compared to 49% in the year ago quarter and 46% in Q1. This lower rate was caused by the additional plating capacity that we have added in North America, bottlenecks in non-plating processes and direct labor shortages in certain regions. Our top five customers contributed 30% of total sales in the second quarter of 2022 compared to 33% in the first quarter of 2022. We had one customer above 10% in the quarter. At the end of Q2, our 90-day backlog, not including Telephonics, which is subject to cancellations, was $635.7 million compared to $553.1 million at the end of the second quarter last year and $605.3 million at the end of the first quarter. With Telephonics included, our 90-day backlog at the end of Q2 was $703.7 million. Our book-to-bill ratio was 0.89 for the three months ending July 4. As we look forward to the fourth quarter and beyond, we will continue to closely monitor global economic influences on our commercial business. To date, we have seen minor impacts as specific customers focus on managing inventories to line up with expected semiconductor chip deliveries. Our backlog continues to be robust however and we expect the aerospace and defense market to provide a strong countercyclical element to our commercial business, if conditions should weaken. I'd like to conclude by again highlighting the significant strategic moves that we made in the quarter with the groundbreaking in Malaysia and the completion of the Telephonics acquisition, both of which will further differentiate TTM and our technology solutions. I also want to thank our employees for continuing to contribute to TTM and our critical mission of inspiring innovation for our customers. Our business performed much better than we expected as a direct result of our employees and our supply chain partners' concerted efforts to support TTM and our customers. Now Todd will review our financial performance for the second quarter.

Thanks, Tom, and good afternoon, everyone. I apologize if I sound a little congested. I'm getting over a cold and I hope you'll bear with me. Today, I'll be reviewing our financial results for the second quarter, which are also shown in the press release distributed today as well as on Slide 6 of our earnings presentation posted on our website. For the second quarter, net sales were $625.6 million compared to $567.4 million in the second quarter of 2021. This year-over-year increase in revenue was primarily due to strong growth in our commercial markets, particularly in data center computing and medical, industrial and instrumentation sectors. GAAP operating income for the second quarter of 2022 was $37.2 million, which included $10.6 million of acquisition-related costs. This is a comparison to $40.9 million in the same quarter of 2021. On a GAAP basis, net income in the second quarter of 2022 was $27.8 million or $0.27 per diluted share, compared to GAAP net income of $28.3 million or $0.26 per diluted share in the same quarter last year. The remainder of my comments will focus on our non-GAAP financial performance, which excludes M&A-related costs, restructuring costs, certain non-cash expense items, and other unusual or frequent items. We present non-GAAP financial information to enable investors to see the company through the eyes of management and facilitate comparisons with expectations and previous periods. Gross margin in the second quarter was 20%, the highest level since the divestiture of our Mobility business, compared to 18% in the second quarter of 2021. This increase was due to better pricing and product mix, higher levels of quick-turn business, and the benefits from higher revenues, partially offset by higher year-on-year labor costs, particularly in North America, where we had a special wage adjustment earlier in the year to remain competitive, as well as higher material costs. Selling and marketing expenses were $16.9 million in the second quarter, or 2.7% of net sales, versus $14.2 million or 2.5% of net sales a year ago. General and administrative expenses for the second quarter were $35.4 million or 5.7% of net sales, compared to $28.6 million or 5% of net sales in the same quarter last year. In the second quarter of 2022, R&D expenses were $5 million or 0.8% of revenues, compared to $4.1 million or 0.7% in the year-ago quarter. Our operating margin in Q2 was 10.8%, an outstanding result given the macro challenges we have been facing, and our highest levels since the divestiture of the Mobility business, compared to 9.7% in the same quarter last year. Interest expense was $10.2 million in the second quarter compared to $10.5 million in the same quarter last year. During the quarter, there was a positive $6.8 million foreign exchange impact below the operating line. Government incentives and interest income increased to $7.6 million or $0.06 of EPS, which compares to a loss of $0.7 million or $0.01 of EPS in Q2 last year. Our effective tax rate was 15% in the second quarter, resulting in a tax expense of $9.8 million, compared to a rate of 8.7% or tax expense of $3.8 million in the prior year. Second quarter net income was $55.3 million or $0.54 per diluted share, compared to a net income of $40 million or $0.36 per diluted share in the second quarter of 2021. Adjusted EBITDA for the second quarter was $96.9 million or 15.5% of revenue, compared with adjusted EBITDA of $75.6 million or 13.3% of revenue in the second quarter of 2021. Depreciation for the quarter was $21.8 million, and net capital spending for the quarter was $26.4 million. Cash flow from operations was $79.3 million or 12.7% of revenue, exceeding our target of 10%. Free cash flow was very strong at $52.9 million or 8.5% of revenue. During the quarter, we completed our $100 million stock buyback program and acquired Telephonics using cash on hand. After all that, our balance sheet and liquidity positions remained very strong. Cash and cash equivalents at the end of the second quarter of 2022 were $266.5 million. Our net debt divided by the last 12 months' EBITDA was 2.2, slightly above our target of 2.0. Our leverage ratio is better than we had expected due to the stronger EBITDA results for the second quarter, and the $300 million cash outlay for the Telephonics acquisition was about $30 million less than we had anticipated as a result of working capital adjustments. Now, I'd like to turn to our guidance for the third quarter. We expect total revenue for the third quarter of 2022 to be in the range of $655 million to $695 million. We expect non-GAAP earnings to be in the range of $0.41 to $0.47 per diluted share. This guidance includes a full quarter of revenue and profit from Telephonics, approximately $69 million and $0.04 of EPS, respectively. We expect that pricing actions taken earlier in the year to mitigate labor cost increases will have a positive impact in the quarter, but we also anticipate lower levels of quick-turn business. The EPS forecast is based on a diluted share count of approximately 103 million shares, including dilutive securities such as options and stock and restricted stock units. We expect that SG&A expense will be about 8.5% of revenue in the third quarter, and R&D to be about 1.1% of revenue. We expect interest expense to total approximately $10.2 million. Finally, we estimate our effective tax rate to be between 13% and 17%. To assist you in developing your financial models, we offer the following additional information. During the third quarter, we expect to record amortization of intangibles of about $11.7 million, stock-based compensation expense of about $5.5 million, non-cash interest expense of approximately $0.5 million, and we estimate depreciation expense will be approximately $24.5 million.

That concludes our prepared remarks. And now I'd like to open the line for questions. April?

Yes, thank you. Good afternoon. Tom, I was hoping you can give us a little bit more color on some of the end markets. It looks like you had a pretty strong growth in most of the sectors, but you are calling for auto to be down again quarter-on-quarter. And I'm wondering, what you're seeing some other suppliers. And I know that you're sort of at a different spot in the supply chain than maybe the semiconductor guys, but there's expectations of growth over the next couple of quarters just on production and content. So I wanted to get your read on that? And then also, just on the quick-turn business, could you remind us how big revenue it is as a percentage of sales? And then why are you seeing a slowdown or why did you see a pick-up in the quarter?

Sure, let me start with the automotive situation. Overall, we had a strong quarter, especially with regard to year-on-year growth rates. Specifically for automotive, we forecast a sequential decline of about 6%, but we're up approximately 6% year-on-year. A part of this is related to automotive customers and summer shutdowns, which particularly affect Europe, and the impact of inventory pull plans in that region. We are also experiencing some effects from the semiconductor shortage, meaning customers are adjusting their inventory levels while waiting for chips to arrive and only pull inventory once they do. It’s important to note that our situation differs from others in the market. Despite these challenges, the automotive sector remains robust. Regarding quick-turn and premiums, most activity is in North America, but we observed some premium activity in Asia Pacific as well. This activity, especially critical for MII customers, is linked to their need for prototyping support and related development as they create new products. As we approach the third quarter, we anticipate a more normal pace between premium and quick-turn relative to standard levels. We expect to see how the quarter unfolds, noting that the market is beginning to stabilize. Additionally, with summer, there tends to be less prototyping activity. Rather than focusing on percentage versus revenue, it's better to view this as an unusually heightened quarter that we expect to normalize. I'm not sure, Todd, if you have the percentage figures at hand?

Yes, we typically operate on a global basis, which differs between North America and Asia Pacific, as Tom mentioned. Generally, we see around 9%, but in 2021 it was less pronounced. Over the last few quarters, however, there's been a significant uptick. A large part of this increase is related to prototyping activities, while another aspect involves lead times. As demand surged, lead times increased, prompting people to mix and match and expedite orders to better align with their supply chains as parts arrived. We definitely noticed more of this activity. As lead times begin to decrease, we anticipate seeing less of this behavior. Prototyping activity tends to be more consistent over the longer term, despite Tom's valid point about summer seasonality. The lead time factor driving some of our increased activity is expected to gradually lessen as we progress through the year.

Okay, thank you. And then on the gross margin, I understand why it will be down sequentially, but it still sounds like just backing into that number. Based on the OpEx number you gave us, it still looks like it will still be well above 18%. And as you go forward, given the Telephonics acquisition, are there any cost synergies that you see either on the impacting gross margin or OpEx over the next few quarters or really was that just obviously acquiring that company for the technology and the product set?

We have been very clear about our synergy expectations. We have preliminarily identified $12 million in synergies that we aim to achieve through efficiencies by the end of 2024. A significant portion of that will come from cost of goods sold, including materials and infrastructure, and operational expenses will also be affected. Therefore, we will observe improvements in their margins. While their margins are currently somewhat lower than ours on average, we anticipate that they will surpass our legacy margins once we implement the identified synergies.

Okay. All right. Thanks very much.

Thanks, Matt.

Thank you. I'm pleasantly surprised you're seeing these tailwinds when others particularly are sitting decommits and material not coming in, particularly on semiconductor side. Is there something in particular you knew what your clients are doing that manage that process better than others?

I think it's important to highlight the work we've been doing to meet the accelerated demand from our customers. There are two major factors at play. First, our teams in Asia Pacific and North America have been very responsive, thanks to the entire organization. The sales team has been working closely with our customers to understand their needs, while operations have been quick to adjust by making room for products. They've managed to adapt as customers navigate unexpected deliveries of semiconductor chips and the need to fulfill programs. Our team has shown agility in responding to these challenges, and I give them full credit. In North America, we've faced a challenging labor environment, yet our human resources and operations teams have successfully staffed many of our critical facilities. There's still room for improvement in this area. Production from North America accounted for about 42% of our revenue this past quarter, which is consistent with previous quarters. We are focused on bringing in more labor and, importantly, we've seen productivity improvements in North America that have contributed to better results. Overall, I would emphasize our alignment with customers and our ability to meet their changing demand profiles. Regarding the direct impact of semiconductors on TTM, our Telephonics business is notably more exposed. However, in our integrated products and subassembly work, while we do use some chipsets, the number is manageable. Our supply chain team has effectively organized deliveries as needed.

Okay. Thank you, Tom. And then just one other question on the differentiation front. Part of that is, could you comment on the design wins and activity in automotive, but then more broadly talk about your outlook to get involved with earlier engineering and design work on the automotive side similar to what you're doing with some of your defense customers?

Sure. Regarding the automotive sector, I find it notable that our customers have been somewhat cautious about releasing large bidding packages, likely waiting for clarity on their product build plans. Consequently, our wins have decreased a bit, with a total program value of approximately $60 million from 13 design wins. This is a decline compared to last year, where we saw around $122 million. I attribute this decrease to the current economic conditions and anticipated product changes, which have made customers more hesitant in their bidding processes. However, I anticipate that the pace of opportunities will significantly increase as we move through the year. One of the major shifts we've noticed in automotive over the past few years is the increasing involvement of OEMs in the design and process. While Tier 1s remain our primary customers, we are seeing a greater level of engagement from OEMs, particularly in engineering discussions related to RF and ADAS systems, which are becoming essential in vehicles. This engineering involvement tends to begin early in the design phase. Moreover, our RF and Specialty Components Group, which we acquired from Anaren, has been crucial in enhancing these engagements. Their RF expertise and focus on module solutions with our customers have enabled us to strengthen our collaborations with both Tier 1s and OEMs. Additionally, with the influx of EV companies, many are starting their collaborations directly with us and typically focus on getting the design right before considering assembly services. We are witnessing growth in our partnerships with these EV companies as well. This should provide a clear picture of how the landscape in the automotive sector has evolved over the past few years.

Excellent. Thank you very much.

Thank you.

Next we'll hear from Jim Ricchiuti of Needham & Company.

Hi, thanks. Good afternoon. I wanted to again go back to that quick-turn business which was significantly higher. I don't recall you guys having an instance where you called that out, that kind of strength, at least in recent quarters. And my question is, I'm wondering if you can give us any sense as to how much of a lift that might have given your gross margins in the quarter?

It's a significant lift, essentially reflecting a price increase. We have maintained a relatively steady level of activity, and the additional activity from the last couple of quarters has been quite substantial. In Q2, we saw more than we had anticipated and expected to see some reversion to the mean based on our historical performance. We expect this trend to continue in Q3, but we were pleasantly surprised by the performance in Q2, which provided an additional boost. The reasons for our improved gross margin this quarter were more complex than usual. Revenue-related factors such as volume, mix, pricing, and premium all played a crucial role, significantly offsetting the increased material and labor costs we had experienced in recent quarters. Pricing and premium had a greater impact than volume.

Okay. And I'm wondering if there's any read-through on the PCB book-to-bill being below 1? And Tom, you kind of very quickly alluded to some minor impacts where you're seeing some signs of change in demand. Obviously, we're all looking for any indications that business may start to weaken. So I was just wondering if you could elaborate on that?

Certainly. If you analyze the overall book-to-bill, the main factor related to the recovery of bookings on the commercial side is our success in reducing lead times in our plans. Although lead times remain elevated, their reduction allowed customers to delay their orders. This ties into what Todd discussed regarding quick-turn needs; as lead times stretch, customers require more quick-turn premium work. With the normalization in the commercial sector, we began making lead time adjustments, which was the most significant factor. Additionally, specific customers, particularly in computing and networking, faced semiconductor issues that prompted them to adjust their inventory. Inventory adjustments served as a secondary factor. Lastly, we experienced a weaker quarter for A&D bookings, but those bookings have shifted to the upcoming quarter, indicating that we can expect a strong bookings performance in the third quarter. These shifts also played a role in our bookings metrics, highlighting three key factors.

Got it. Congrats on the quarter and on closing Telephonics. Thanks.

Thank you, Jim.

Next we'll hear from William Stein of Truist Securities.

Great. Guys, congratulations on these very strong results, especially the margins. First, I'm hoping you can talk to us a little bit about how ramping of capacity and production in the India facility might influence your gross margins if that's going to have a meaningful impact?

I think, Todd, you can answer on that. Yeah, Malaysia facility.

In Malaysia, the impact will be negligible this year. Next year, as we start to incur infrastructure costs, bring on leadership, and hire employees mid-year, there will be a drag on performance. We haven't updated the numbers since our initial announcement, and I'll have more information as we get closer to it since we haven't provided any insight for 2023 yet. We anticipate some negative impact as we ramp up in 2023. We likely won't achieve what we consider to be normal run-rate margins until late 2024, and we expect to be operating at full capacity by the end of 2024 or early 2025. Margins will lag a bit because we need to hire and train people before we can build products, which will be a headwind during the ramp-up. However, we do expect to reach normalized margins around late 2024 or early 2025.

The follow up…

Yes, go ahead.

No, no. Please continue after.

I want to emphasize that one of the main reasons for this facility is that we had customers ready to commit, and we now have long-term agreements with them. This gives us confidence in our sales, revenue, and product mix, which will help us streamline the ramp-up process as we bring the facility online. Having this foundational assurance is very beneficial.

Great. The follow-up relates to the CHIPS Act. I'm aware you're not a semiconductor device company, but I wonder if there might be a secondary influence on your business. Is there any potential for a primary direct effect on your business?

Thank you. We have certainly supported these efforts through the IPC and the PCB Association of America, reminding Congress that chips are part of a larger electronics ecosystem. This message has been consistent for us. While it's true that the funding won't directly impact us significantly, it will benefit our customers, and semiconductor customers are essential to our business. We conduct testing and burn-in board production, so we anticipate interesting developments from a demand perspective. Additionally, we're excited about the $2.5 billion allocated for microelectronics. Our microelectronics business in Syracuse generates around $50 million annually, and we recognize the importance of microelectronics and advanced packaging within the broader ecosystem. We will work with our customers to address infrastructure needs for both microelectronics and advanced printed circuit board technologies. We are looking forward to seeing these developments and will stay engaged with consortia and associations to ensure appropriate support is provided. Overall, it's encouraging to witness investment in infrastructure in North America.

Great. Thank you.

Thank you.

And it appears there are no further questions at this time. I'll turn the call back over to Tom for any additional or closing comments.

Great. Thank you. Thanks, April. I'd like to just close by summarizing some of the points I made earlier. First, we delivered revenues and earnings above the high end of guidance. And the fact that we've seen many of the cost headwinds of the past year really turn into tailwinds in this past quarter. Second, our end market diversification really enabled solid year-on-year revenue growth of 10.3%. Third, we generated strong cash flow. And fourth, we took important steps in advancing our strategy of differentiation with the acquisition of Telephonics and the breaking ground of our new facility in Penang, Malaysia. In closing, I'd really just like to thank our employees, our customers and our investors for your continued support. Thank you very much.

That does conclude today's conference. Thank you all for your participation. You may now disconnect.