Thank you for joining us for Vicor's Second Quarter 2024 Earnings Conference Call. All participants are currently in listen-only mode. Following the speaker's presentation, there will be a question-and-answer session. Now, I would like to turn the call over to Jim Schmidt, Chief Financial Officer. Please proceed.

Thank you. Good afternoon and welcome to Vicor Corporation's earnings call for the second quarter ended June 30, 2024. I am Jim Schmidt, Chief Financial Officer, and I am in Andover with Patrizio Vinciarelli, Chief Executive Officer. Phil Davies, Vice President, Global Sales and Marketing, is joining remotely. After the markets closed today, we issued a press release summarizing our financial results for the three and six months ended June 30th. This press release has been posted on the Investor Relations page of our website, www.vicorpower.com. We also filed a Form 8-K today related to the issuance of this press release. I remind listeners this conference call is being recorded and it's the copyrighted property of Vicor Corporation. I also remind you various remarks we make during this call may constitute forward-looking statements, for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Except for historical information contained in this call, the matters discussed on this call, including any statements regarding current and planned products, current and potential customers, potential market opportunities, expected events and announcements, and our capacity expansion, as well as management's expectations for sales, growth, spending, and profitability are forward-looking statements involving risks and uncertainties. In light of these risks and uncertainties, we can offer no assurance that any forward-looking statement will, in fact, prove to be correct. Actual results may differ materially from those explicitly set forth and/or implied by any of our remarks today. The risks and uncertainties we face are discussed in Item 1A of our 2023 Form 10-K, which we filed with the SEC on February 28, 2024. This document is available via the EDGAR system on the SEC's website. Please note the information provided during this conference call is accurate only as of today, Tuesday, July 23, 2024. Vicor undertakes no obligation to update any statements, including forward-looking statements, made during this call and you should not rely upon such statements after the conclusion of this call. A webcast replay of today's call will be available shortly on the Investor Relations page of our website. I'll now turn to a review of our Q2 financial performance, after which Phil will review recent market developments and Patrizio, Phil, and I will take your questions. In my remarks, I will focus mostly on the sequential quarterly changes for P&L and balance sheet items and refer you to our press release or our upcoming Form 10-Q for additional information. As stated in today's press release, Vicor recorded total revenue for the second quarter of $85.9 million, up 2.4% sequentially from the first quarter of 2024 total of $83.9 million, and down 19.6% from the second quarter of 2023 total of $106.7 million. Advanced product revenue increased 7.1% sequentially to $46.4 million, while Brick Products revenue decreased 2.7% sequentially to $39.5 million. Shipments to stocking distributors decreased 5.2% sequentially and increased 33.1% year-over-year. Exports for the second quarter increased sequentially as a percentage of total revenue to approximately 43.3% from the prior quarter's 42.6%. For Q2 advanced products share of total revenue increased to 54% compared to 51.6% for the first quarter of 2024 with Brick Products share correspondingly decreasing to 46% of total revenue. Turning to Q2 gross margin, we recorded a consolidated gross profit margin of 49.8%, which is a 400 basis point decrease from the prior quarter, primarily due to a change in product mix. During the quarter, we recovered approximately $662,000 in duty drawback of previously paid tariffs. Tariff expense net of duty drawback was approximately $0 in Q2. I'll now turn to Q2 operating expenses. Total operating expense decreased 30.5% sequentially from the first quarter of 2024 to $42.6 million. The sequential decrease was primarily due to a reduction in legal fees and expenses. The amounts of total equity-based compensation expense for Q2 included in cost of goods, SG&A, and R&D was $744,000, $1,757,000 and $930,000 respectively, totaling approximately $3.4 million. Turning to income taxes, we recorded a tax provision for Q2 of approximately $4.2 million. The company's tax expense and the rate for the quarter has been impacted by the capitalization of R&D expenses under Section 174, as well as the full valuation allowance we carry against deferred tax assets. Net loss for Q2 totaled $1.2 million. GAAP diluted loss per share was $0.03, based on a fully diluted share count of 44,855,000 shares. Turning to our cash flow and balance sheet, cash and cash equivalents totaled $251.9 million at Q2; accounts receivable net of reserves totaled $54.9 million at the quarter end, with DSOs for trade receivables at 45 days. Inventories net of reserves decreased 2.9% sequentially to $109.1 million. Annualized inventory turns were $1.7. Operating cash flow totaled $15.6 million for the quarter. Capital expenditures for Q2 totaled $6.1 million. We ended the quarter with a construction in progress balance, primarily for manufacturing equipment, of approximately $12.6 million and with approximately $15.8 million remaining to be spent. I will now address bookings and backlog. Q2 book-to-bill came at above 1 and 1-year backlog increased 2.3% from the prior quarter closing at $153.8 million. As we said on last quarter earnings call, 2024 is a year of uncertainty and opportunity. As of today, the quarterly and annual outcome in terms of top line and bottom line is subject to a relatively wide range of scenarios. Given the wide range of possible outcomes, we are unable to provide quarterly guidance until we are further along resolving uncertainties and capitalizing on opportunities. With that, Phil will provide an overview of recent market developments and then Patrizio, Phil, and I will take your questions. I ask that you limit yourself to one question and a related follow-up so that we can respond to as many of you as possible in the limited time available. If you have more than one topic to address, please get back in the queue.

Thank you, Jim. It was good to see our book-to-bill get above 1 for the first time in eight quarters, driven by stronger demand in our industrial and aerospace and defense markets and ramping new programs in high-performance computing. As we discussed at our annual shareholders meeting a few weeks ago, our HPC business is in transition to our new power technology, whose high current density enables scalable vertical power delivery solutions. The AI market is forecasted to continue its remarkable growth, providing significant business opportunities for the leading GPU company and all of its aspiring competitors. Focused on taking a share of the sizable opportunity, we are currently working with customers wishing to capture the value proposition of cutting power delivery network power loss and gaining a competitive edge by moving to scalable vertical power delivery for new higher power GPUs and network processors, and also with wafer scale and chiplet-based AI processor designs utilizing advanced packaging technologies. Our Gen 5 current multipliers occupy one-third of the footprint and are three times thinner than stacked package multiphase solutions. Stacked multiphase vertical power delivery solutions are challenged mechanically, thermally, and from the intellectual property perspective. Preparations for the introduction of our Gen 5 chipset are progressing and we have powered up our first Gen 5 customer evaluation board. A broad business portfolio is necessary to provide greater stability to our business by focusing on 100 customers globally across four main markets and a product development strategy of leveraging technologies and products developed for our HPC and automotive markets for the industrial and aerospace and defense customers; we believe that we are well-positioned. We have also partnered with top distributors globally in supply and logistics support for our broad market business that further amplifies our capabilities and opportunities. At the annual shareholders meeting, we outlined our goal of doubling revenues in our industrial and aerospace and defense markets. New AC to DC and DC to DC converter power modules utilizing advanced packaging technologies from our new chip fab, and advances in control systems and components, enable two to three times higher power density and are being sampled to our top 100 customers in these markets. The movement of automotive OEMs to a 48-volt based zonal architecture has diversified our opportunity base from the battery electric vehicle market into mild and plug-in hybrid powertrain applications, and we are seeing an increase in new business opportunities across EMEA, Japan, and Asia Pacific. I am pleased that in Q2 we were awarded an additional program for onboard charging at a leading high-end automotive OEM, which will begin to ramp in 2026. Overall, our automotive pipeline, which currently stands at $1.3 billion, continues to grow and we are quickly regaining the momentum lost due to the slowdown in new platform development during COVID. Thank you. And with that, we'll now take your questions.

Okay, operator, we are ready for questions.

Thank you. Our first question comes from the line of Quinn Bolton of Needham & Company.

Hey guys, congratulations on the first positive book-to-bill in several quarters. I guess, Patrizio or Phil wanted to ask at the annual shareholder meeting, you guys sort of gave a roadmap for the sampling of the Gen 5 technology and wanted just to double-check that everything's still on track for first customer samples beginning to ship next month in August. Is that still on track?

Demo system display to some select customers towards the end of August, that's what we currently expect.

Perfect. And then I guess, maybe just looking at the mix of business, can you give us some sense? I think there may be a misperception in terms of Vicor's current revenue split between your four targeted end markets. Can you give us a sense, how much of the revenue comes from industrial versus A&D versus HPC versus automotive? I think there's a perhaps misperception out there that you guys are still pretty heavily driven by HPC. And I think at the annual shareholder meeting you were saying that the aerospace and defense and industrial markets might be a much higher percentage of current revenue than investors may expect. And so I just wondered if you could sort of touch on revenue by end market.

Sure. Yeah. So I guess, with the decline in our Gen 4 HPC business, the industrial and aerospace business, which has been on a very good growth rate for us over the past five to ten years, has almost doubled. Each of those market segments started to take a bigger share, and so we don't typically break things down, Quinn, as you know. So I will say that aerospace and defense plus industrial is a larger share of our business today than HPC was going back a year and a half.

Perfect. And then just maybe a last question on gross margins. It looks like you had a mix shift that accounted for margins being down. Wondering if there's any more color you could give us in terms of that mix shift. And then I know you'll give us the royalty number in the queue when it's filed, but wondering if you might be able to comment just directionally was the royalty payment received in the June quarter, was that flat, up, or down from the level in March? Thank you.

So the shift in the mix had primarily to do with significant shipments within the past quarter of a legacy HPC system with relatively low margins. So that brought the margins down somewhat.

And just to add to what Patrizio said there, Quinn, I would say also there was a higher A&D revenue stream in Q1. Relative to royalties, you're right. You'll see it in the queue. But we're putting together quarters now of sequential increases that are double digits. So it's positive.

Perfect. I'll get back in the queue. Thank you.

Thank you. Our next question comes from the line of Jon Tanwanteng of CJS Securities.

Hi. Good afternoon. Thank you for taking my questions, and also congrats on the positive book-to-bill. I was wondering if you could talk a little bit more about the mix of orders you saw in the quarter where you saw the most strength. I think you mentioned several buckets, but I was wondering which was the strongest, which surprised you and if that included HPC orders that were, I guess, of the current generation or last generation. If you could bring up more color, it would be helpful.

Phil, do you want to take that?

Sure. So no real surprises, Jon, I would say. We've seen the industrial market in recent years growing nicely. Aerospace and defense is a great business for us, particularly with North America and Europe, we've got some wonderful customers, long-term customers over 30 plus years who continue to grow themselves and award Vicor new business as we moved along. So I wouldn't say anything surprising in the quarter other than continued strength in industrial and aerospace and defense, which we are planning on, as I said in my remarks, doubling over the next five to seven years once again.

Okay. Great. And then can you talk about the margins that you’re seeing going forward, just given the rising concentration, I guess, of this industrial and aerospace, is it going to be another headwind on mix just compared to what you’ve seen in the past, or should it be – should there be a reversion?

Jon, I think I would just go back to the prepared remarks and say that we’re just not going to offer guidance at this point given the range of outcomes that we could experience over the coming quarters for a variety of reasons, some of which are going to be fairly sizable and significant potentially. So we just don’t provide the guidance right now.

Okay. Fair enough. I’ll jump back in the queue. Thank you.

Thank you.

Thank you. Our next question comes from the line of Richard Shannon of Craig-Hallum Capital Group.

Well, thanks guys, for taking my questions. Maybe I’ll follow up on a prior question here. Patrizio, when you talked about delivery of, I think it was demo systems or samples kind of late in August. What do you think about the time frame by which customers make decisions? And is there going to be any difficulty in time frames hitting their market timing windows in order to do that?

So the development is primarily driven by where we see the applications landing over the next few years. As you know, at any one point in time with different customers or potential customers, there are opportunities that, in some cases, may not line up perfectly with our capabilities. I mean, certainly within the last couple of years, given how things evolved with respect to the market opportunity for earlier generation-based solutions involving lateral, we did not have an alignment that we might have had under different scenarios. But getting back to upcoming opportunities and how we’re going to be able to address them with a 5G chipset, given the much higher current density, much higher power density, both in terms of footprint thickness, ability to provide scalable vertical power delivery solutions that are cost-effective, inherently robust, and thermally adaptable, we think we have a unique capability that is very well aligned with developing market needs. Now, different customers have different agendas when it comes to this, and some that have been in the forefront might choose to wait for that technology to mature. We think the vertical power delivery capability that the 5G chipset enables will provide those customers that are aligned with us a significant competitive advantage.

Okay. Thanks for those thoughts, Patrizio. Let me follow-up with a question that might overlap this topic somewhat here. But as you’re talking with customers about your 5G products, and as you’ve talked about in the last generation here, you saw a change in mindset from customers moving from performance-oriented solutions to one that prioritizes supply chain certainty here. To what degree are you seeing the tone and tenor of those conversations changing here, particularly as you bring your 5G solutions to them? Are they changing? Are they contingent on other actions like what you have going on in the legal realm, or waiting on manufacturing to mature or have enough volume there? What are – kind of what are the things that build into the change in approach from the last generation to what you hope will be a performance-oriented one going forward?

So, to your point, the priorities as of a few years ago for leading customers in AI switched to scalability and supply chain multisourcing commoditization. And with respect to that particular customer, we don't see a change taking place in the near term. But we do believe, based on our visibility with respect to power system needs, that is not a viable approach in the long term. But we wait to see how things evolve on that general front. With respect to the rest of the world, looking to catch up, their performance is what this is all about, right. And in effect, the general set of priorities are quite different because competitors aspiring to compete, particularly on the hardware front, want to make, want to enable the most competitive, most advanced hardware solution. And their priority is not necessarily one of multisourcing commoditization at this point of performance. Is performance ahead of those other considerations, particularly since with our fab, we have a level of scalability.

Okay, great. Thanks for all the detail, Patrizio.

Thank you. Our next question comes from the line of John Dillon of D&B Capital.

Hello guys. Congratulations on the positive book-to-bill again. Patrizio, I have a follow-up question on the customers who are looking for performance. Do you have any design wins with any of those guys yet or do you expect design wins from them shortly? With the exception of the one customer you've talked about that you've got coming in Q1 2025.

So we have design wins. They are not – when it comes to 5G solutions yet diversified and across a substantial multiple share of customers. We have a few primary engagements that, in our view, represent a great deal of opportunity. So we're focused first on servicing their needs. As we get further along later this year, we're going to be straining our wins somewhat in terms of involving others.

Great. Good to hear. My follow-up is with the legal, with the positive outcomes in the court cases against Delta. Are other infringers now coming to the table and negotiating with you?

So for a variety of reasons, I'm not going to get into any details regarding the evolving IP issues, beyond saying that at this point, our first case is complete. It's with the administrative law judge. We expect the decision at the beginning of October, and we expect that to be a favorable decision that should before too long result in an exclusion order. And we'll see where it goes from there. Fundamentally, we cannot continue to allow certain companies within the industry and OEMs that work closely with those companies to misappropriate intellectual property. We’re going to be extremely firm about it. We have the resources to see to it that these kinds of abusive practices come to an end and there may be lying down situations that result as we progress along with our campaign.

Great. That’s good to hear. Thank you very much.

Thank you. Our next question comes from the line of Alan Hicks of Ainsley Capital.

Yes. Good afternoon. I had a question that’s going to follow up on Advanced Products. Did you say that royalties increased double digits this last quarter?

I think I was kind of – that’s probably in reference to royalty income. So that’ll – the numbers will be in the 10-Q when it gets filed. It has been increasing.

Okay. And then, so it sounds like overall Advanced Products you produced, in fact, they’re also increasing.

I’m sorry, Alan, I didn’t catch that.

So it looks like your Advanced Products rose by about $3 million. So if royalties grew, say, to roughly $1 million, then Advanced Products you produced are now increasing also as part of the overall Advanced Products revenues.

Yes. So legacy products in Q2 declined somewhat.

That’s right.

Okay. And so then in the annual meeting, you announced a series of new products for industrial, aerospace, military. Are those released yet? Were they in this last quarter? Are they yet to come?

Yes. So we have a very deep set of products, both for point-of-load applications, obviously just within the 5G lineup. We have a new class of so-called PRMs, MCMs drivers. It’s a complex landscape to serve a broad set of needs at the point-of-load in HPC, or other applications where the high currents at relatively low voltages are needed in escalating amounts. Then, on a totally different front, but using the same packaging technology, the same fab, we have our system products that, as Phil suggested earlier, range from very high power onboard chargers for electric hybrid vehicles to bus converters to the CDC converters for automotive applications and industrial applications. So it isn’t one product. It’s a very comprehensive set of products that will be continued to expand our capabilities. And it’s not one product in any one week or month. Again, it’s an expanding product portfolio that leverages the converter housing package, proprietary technology that we’ve been developing over now many years, and the foundry capability that we put in place.

Okay. Would you say in this last quarter, the industrial, aerospace, military was a majority of Advanced Products sales?

I’m not sure I understood the question. Maybe, Phil, if you understood the question, you can answer it.

Yes. No, I think it’s pretty close to 50-50.

Okay. And then the products you announced at the annual meeting that you announced a series of new products that are coming out.

Yes. Yes.

Are those shipping yet or those yet to come?

Those are being sampled to lead customers in our top 100. We expect a general release in Q4 into industrial through our distribution partners.

Okay.

Just to be clear, this is not the case of some particular event of any one point in time where 50 new products get announced. It is a large multiplicity of different devices, either for point of load or for general power system type applications that come through the various phases of our NPI process and that come out when they're ready in a sequence that has timing scales, one of months. So it's not just a Q4 event. In Q4, there are certain products of particular interest to certain class of customers and applications. In Q3, there's going to be some other things in Q1 of next year, yet other ones.

Okay.

The point I'm trying to get at is that you're going to have a more stable advanced product revenues across a broader base, and it'll increase gradually over time from those industrial aerospace areas. Well, let me address your point in that regard this way. If we look at our factorized power system solutions, leveraging our 5G technology with the new class of PRMs, MCXs, MCMs that we're bringing to fruition, and we're going to be starting to demonstrate through our PCAR demo system board. That's an expansive family of product capabilities, spanning ranges that are quite broad, all the way up to 2,000 amperes and down to hundreds of amperes. And those are going to have a very broad market opportunity, whether they're deployed in lateral configurations or vertical power delivery systems. So the total in the aggregate number of devices and chips involved in that portfolio is quite large, a double-digit number of devices that relate to one another through certain scalability protocols that enable us to have fundamentally common denominator scalable capabilities. So it's not one product one day; it's a class of products aimed at a particular market opportunity with broad coverage.

Okay, so it sounds great.

Thank you.

Thank you. Next question. Our next question is a follow up from Jon Tanwanteng of CJS Securities.

Hi guys, thanks for the follow up. I was wondering if you could break out a little bit more on the licensing and royalties business. Is that increasing due to the number of licensees increasing or are your current licensees or existing licensees just increasing their volumes or a little bit of both? Which one is actually the stronger driver of growth there?

So we're not providing that visibility. So fundamentally, what we need to disclose with respect to that facet of our business will be reported when...

In the 10-Q at the end of this month.

And please look at that for all the detail that we're going to be providing. But for a variety of reasons, we need to keep our licensing engagements from a level of visibility, scrutiny that our licensees would not want to have us disclose. And we obviously respect that.

Okay, that's fair. And then Jim, just a quick question on the taxes. What should be the rate we should be looking at going forward? And kind of what was the impact of the evaluations that you took this quarter?

I would say I can’t give any particular guidance about the rate per se. I wouldn’t be offering up a change to what we talked about earlier. It has been lumpy. We acknowledge that the 174 was a period deductibility. Now it’s amortized over five years. Congress may pass a law to reinstate that tax deduction, and then we have a valuation allowance as well. So that’s a full valuation against deferred tax assets. So, Jon, it’s challenging, I’m sorry to say that, but it’s kind of the unique situation we find ourselves in at this point.

Okay, I hear you. Thank you.

Thank you. Our next follow-up question comes from Richard Shannon of Craig-Hallum Capital Group.

Hi guys. Thanks for letting me follow-up here. I guess my first question is, I think Phil mentioned his prepared remarks about an automotive pipeline of 1.2 billion. Would love to get some sense of what that looks like between EVs versus hybrids and any geographical concentration of that. And then maybe if you’d like to offer it if you can, or characterize in any way what that pipeline looks like for HPC customers as well. Thank you.

Okay. So regarding the automotive pipeline, we started off really focusing on BEV. So the majority of that pipeline, I would say greater than 50% is definitely BEV powertrains. Recently we’ve started to see, as I talked about at the Annual Shareholders Meeting with the 48-volt zonal, we’ve started to see plug-in hybrid and mild-hybrid opportunities and also some ICE applications as well, switching to 48 volts zonal architecture. So I would say out of the 1.3 billion, it’s probably still 50%, 60% BEV, and then roughly equally split between mild-hybrid, plug-in hybrid, and ICE on 48 volts.

Yes. Just characterizing the pipeline and HPC, what does that look like? Do you want to characterize or quantify in any way? That’d be great, Phil.

Yes, no, I mean, I think it’s fair to say that with Gen 5, the objective is to rebuild, if you like, the HPC pipeline across GPUs. We talked about network processors. There’s some very high current network processor companies that we’re working with on vertical power delivery, and also some exciting stuff on chip scale, well, sorry, wafer scale and chiplet with advanced packaging, down in the APAC area. So I think we’re excited about what we’re seeing out there and what we believe Gen 5 is going to be able to bring to our company as we launch it out there in Q3, Q4.

Wonderful. Thank you, Phil.

Thank you. Our next follow-up question comes from John Dillon of D&B Capital.

Hey, it’s John Dillon. Hey, Phil. I was wondering if the bookings have legs or is this a one quarter anomaly? Can you guys hear me?

Yes, I can, John. Sorry. I was on mute. So I think what we’re seeing is aerospace and defense and industrial markets continue. The variable in the bookings is going to be what happens in HPC, and even with some new automotive programs where we can book orders based upon collaborations and payments from automotive OEMs or Tier 1. So I think the aerospace and industrial markets seem to be continuing their strength, and the variable that we talk about, so we can’t provide the guidance is really all about HPC and what happens there for us.

So it sounds like HPC could go up or down depending on what happens and may be a good assumption, or do you see HPC kind of remaining flat and possibly going up?

Again, like John, my comments are that’s why we don’t provide the guidance. It could go up, it could go down, it could stay flat. I mean, there’s lots of variability in that for us right now, and we’re very, very focused on Gen 5 and getting as many design ins and design wins with that as we can. That’s the way to really build that back up.

Correct. Okay. Got you. And you are seeing design wins on Gen 5 then for the HPC?

We're seeing lots of opportunities, John, where we've still got to get through that demonstration phase in August, September. And from there, we can start to get design ins and then secure programs, which are the wins in our pipeline. So it's going to be a process, but lots of interest.

Great. Thank you very much. Congratulations again. Thank you.

Thank you. Our next question is a follow up from Quinn Bolton of Needham & Company.

Hey, guys, I wanted to follow up on Richard's question on the automotive side. I know at the annual shareholder meeting you talked about some of the initial wins or sort of the very high-end vehicles, but you're sort of looking to try to secure wins with higher volume platforms through 2024. You mentioned, I think, an onboard charger win that you secured this quarter. Wondering if that's starting to move you into some of those higher volume platforms and if that particular design doesn't. How are you feeling about your engagements with OEMs or Tier 1s for some of those higher volume platforms you'd referenced at the shareholder meeting? Thank you.

So the design wins that we have today are still higher performance vehicles. I would call the design ins that we are starting to come down into the, if you like, the high performance of the next level of platforms, down from OEMs globally. So we're certainly not down into the 500,000, a million vehicles a year type of platforms where we're still working at the high performance end. And also then the higher performing vehicles of big car manufacturers around the world as they move to 48-volt zonal with applications like active suspension, the onboard charging application that you've talked about there. And it's really, as I talked about earlier, a really exciting mix of different BEV, mild-hybrid, plug-in hybrid, and ICE opportunities now that are starting to develop, but it's still in the higher end, higher performance vehicles, Quinn.

Got it. Thank you, Phil.

Thank you. Our next question comes from the line of Don McKenna of D.B. McKenna & Company.

Patrizio, if my memory is correct, a number of years ago you had a seat at the table for the open compute project. I was curious as to whether or not you're still participating in that. And the second question I had is, what's the current headcount?

So I think we're around 1,100 people. And to be honest with you, I was never active with respect to open compute. Our general model of innovating and anticipating what the market needs are going to be years down the road is a bit at odds with the process of evolving the power system solution based on what has been known and what can be seen through the kind of common approach that open compute represents. It's fundamentally a different approach to addressing future needs. One, I would say, is trying to anticipate what will work, but primarily based on rear view mirror visibility. Whereas the methodology revolves around looking beyond the corner of what is going to be enabling the next generation of solutions. The two are not entirely compatible.

Okay, and how about current headcount? Can somebody give me a number on that?

Around 1,100 people. Yep.

Thank you.

Thank you. Our next question comes from the line of Al Doyle of Vicor.

Hello?

All right, your line is open. Oh, he's actually left. All right, ladies and gentlemen, that does conclude today's conference call. Thank you for participating. You may now disconnect.

Thank you.

Thank you, everyone. Take care.