Good morning, everyone, and welcome to the twenty-sixth Annual Needham Growth Conference for our first in-person day. I'm thrilled to be here with Amir Panush, the new CEO of CEVA. This is his first time at the conference, and as well, Richard Kingston, Head of IR. So, I'll turn it over to Amir now. Thank you.
Thank you very much. Good morning, everyone. Just to introduce myself for a short minute. I'm Amir Panush. I joined CEVA as CEO about a year ago, at the beginning of January 2023. I've been in the semiconductor industry for about two decades, around wireless communication, DSP technology, processing and software. Today, I will present where we are today with CEVA and how we see the future. I would just remind everyone also that just about a month ago, we rebranded the company, and we have a new logo, as well as a new mission statement. We are basically showing how we are delivering our technologies towards the future, and in 2024, all the way to 2027. With that, let me start. Safe harbor, nothing to mention here. Let me move forward.
First, just a quick introduction to those guys that to you that don't know about that much about CEVA. We have been for the last 30 years, shipping to more than 17 billion devices with our IP technology getting embedded into different type of silicon devices and OEM products. We are traded at NASDAQ. Strong, profitable business today with about $160 million in cash and no debt. We have about more than 200 registered patents, around 450 employees, worldwide distribution, headquarters in Maryland, we have operations and R&D in Israel, France, Serbia, Greece, UK, and the US. A little bit about our business model. You can think about it like Arm just went public as a IP standalone company. Our business model is very similar to Arm. We are very complement to what Arm is doing.
We are licensing our IP. First, we generate the revenue from the licensing of the technology, and then we generate royalties over the years as we work with our partners very closely. We have two distinguished IP offering. One is hardware IP, where we sell it directly to the semiconductor companies, and also software IP, which is quite unique in the markets and different than Arm and others, where we complement our technology in terms of innovation directly to the OEM. This is where we generate licensing and royalty faster, and also the royalty per unit is typically higher. But we have been around for several decades. We have shipped more than 17 billion devices across many, many different customers and winners in the market. You can see some of the big brands.
We have started, and our success has been shipping 10 billion devices in the mobile, but in the last few years, we have diversified very, very significantly to other markets. Notably, you can see consumer IoT. We have shipped more than 60 billion devices. This is the biggest market opportunity for us, moving forward. Automotive, where we have started a few years back, already have shipped more than 100 million devices, and we will see strong growth in the automotive space. Industrial, we have shipped also, and this is where we leverage our success from the consumer market and where we develop, differentiate software to the PC and in the infrastructure, we deliver the highest performance, 5G, 5G Advanced for the micro base stations.
Working globally with all the big brands, whether it's a semiconductor in the MCU space, whether it's the micro base stations and around all the different type of markets. Our mission, and, this is as we rebranded the company, and I'm focusing the team on very clearly to be the partner of choice. Very, very important for us to build the long-term success of the company is to win with the winners, work with them very, very closely, especially in IP. We need to help them to be able to innovate in the markets and drive their success in the long run. This is not just the first licensing, it's really delivering with them long-term relationship and building the royalty pipeline. And with that, we need to offer them transformative IP solutions, where we help them to innovate and come early to the markets.
We always focus on very low power and high performance combination for the edge devices, and all those solutions we are focusing for the smart edge. What's unique about CEVA and our technology when we deliver- develop that and partnering in the market, is that our special design is to have so-called hard-coded designs for the lowest power and the highest performance for the smart edge. Speaking of that, what do we mean by smart edge? There are the data centers in the cloud, so-called the big infrastructure, but on the right side, all the devices that are either the gateway to the cloud or to the data centers or the end devices, all these devices are what we call the smart edge.
What we have seen is with those devices, they are all becoming more and more connected, wirelessly connected, but also much more integrated. There has been a survey recently with all the big MCUs players out there, and they were saying that they are all looking to do an integration. More than 70% of them indicated they want first to integrate audio and so-called sensors capabilities into the device. They want to integrate wireless connectivity with the different technologies. Last but not least, those devices are becoming so-called smarter, with the ability to infer, to do AI locally on the device. We see all those things getting integrated together.
So when we, when we look at the smart edges, how we enable those technologies with the right portfolio to be able to be integrated into our customers' products and solutions. The smart edge represents for us very large opportunities moving forward. About 8% CAGR growth between now and 2030, and the TAM overall for IP is about $10 billion, so significant TAM opportunity for us to keep expanding our business. We expect more than 30 billion device annually shipped at the smart edge with the different type of technologies, and specifically, the semi industry in terms of the size, is about $600 billion by 2030. So overall, significant opportunities for us to grow in the smart edge arena.
But what does that mean, and what do we deliver in terms of technologies in order to enable the smart edge for our customers? There are three major pillars of technologies that we introduce to the markets and work with our partners and customers. First and foremost is wireless communication IP. We are the de facto number one leader in that market, with the larger portfolio of technologies, I'll show more later, as well as shipping more than 1 billion device annually with these type of technologies. The second is scalable Edge AI sensing IP. This is where we are delivering so-called, what used to be more our core DSP technology, moving into the AI, with the ability to run neural networks on the edge.
We have powered more than 500 million devices to date, and we see that a significant growth area for us moving forward. Last but not least, which is different than our typical competitors in the IP landscape, we are also offering embedded application software. We have shipped more than 300 million devices, and this is where we partners with lead audio OEMs in the markets to drive innovation related to immersive audio experience and sensing experience. All that addressing six smart edge markets: the consumer IoT, the automotive, the infrastructure, industrial, PC, and mobile. But out of which, as we look at those 6 different markets, our focus is really on the four left ones. We see PC and mobile, while important and large markets, the growth has slowed down, as well as the innovation to some degree.
In addition, there has been significant consolidation in that market. For us, as an IP supplier, it's very important to be in a market where we see significant growth potential for us, and that requires to have multiple companies, that requires the different multiple technologies. So consumer IoT is by far today, the largest business and also the largest growth opportunity for us. Automotive is that where we drive lots of innovation, high performance. When we'll talk later on about our AI, neural processing unit solution, this is where automotive is a great fit for all the ADAS application. Infrastructure, this is the core of us as CEVA, where we develop DSP and wireless communication, today, 5G, 5G Advanced, and later on 6G, for the micro base stations, and moving now into satellite communication as well.
This is where we drive the highest performance and scale it down to the other markets. The industrial, which is a very nice continuation of what we are doing in the consumer IoT. Lots of our customers, they need access both to consumer type of technology as well as industrial, and we offer them both across our product portfolio. So what that means in terms of the use cases and what is our focus? There are three main use cases at the smart edge, that we have laser focus on how to enable that, all combined for our customers. The connect, all the wireless communication. The sense, to provide immersive sensing. All these devices today, again, they need to get in and out the data.
They need to be able to sense the surrounding through the sensors, and as well as now doing infer or localizations of capabilities, in order to understand the data and make decisions. This is going back to what I said about so-called the MCU, the CPU players out there, the SoC players. They have some components, and they really want all the other components to get integrated. We are coming in and helping them to go and deliver that in the market. This is the smart edge as we look at that, the integration of all these use cases at the edge. So at CES, just a week ago, we announced several new products, launches, as well as strong partnership across the ecosystem. Some with customers, some with partners, across the connect, sense, and infer use cases.
As for Connect, we announced our availability of the Wi-Fi 7 IP. We are the first to markets to offer a Wi-Fi 7 IP, which means every customer that want to, to move from Wi-Fi 6, to transition from Wi-Fi 5 or Wi-Fi 6- Wi-Fi 7, is a potential customer for us. And actually, we already licensed this technology, already engaging with many, many customers about the ramp that is coming next year for Wi-Fi 7. We announced with Sunplus, the expansion, not just from audio, but also Bluetooth and audio, partnership. Again, we see customers coming back and requiring multiple technologies from us, from our portfolio. Going back to the integration, and I talked related to the smart edge. As for Sense, we announced a partnership and also delivery of our technologies to boAt.
boAt is the wearables number one in the OEM, and also now number two to Apple worldwide in terms of volume shipments. So this is significant opportunity for us with our immersive audio capabilities, as well as the DSP and wireless communication. We announced partnership with THX in terms of high-end premium audio capabilities, where we deliver together a solution to the markets. And the infer, we announced partnership. Being successful in the AI domain is not just about delivering our silicon IP or the neural processing unit, it's about having the right partnership for a complete software stack and ability to train the networks. And last but not least, also with Actions as OEM, shipping more than 100 million devices so far.
So now I, I'll take you a little bit about our position in the connect, sense, and infer, and what we have to offer. So in the connect space, we are, as I mentioned, the number one IP licensor worldwide. We have Wi-Fi technology, we have Bluetooth technology, we have UWB technology, and we have Narrowband IoT technology, which means every customer out there that wants to add wireless communication technology, instead of doing that internally, have a complete access to our, portfolio of IPs, either as a standalone IP or as a combination of those different type of IPs. Overall, more than 5 billion devices already shipped with our wireless communication short-range technologies.
More than 100 distinguished customers or licensees are using our technologies, and more than 500 man-years invested, which means that we are keep adding more and more to our leadership in that market and created higher barrier to entry and more distinguished positioning in that marketplace. In addition to the short-range wireless technologies, we have been also a leader in the wide-area wireless technologies. Started early days in the 2G, 3G, and now we are delivering 5G, 5G Advanced, and in the future, 6G wireless technologies, all the way from the handsets to so-called, what is called the industrial IoT, cellular IoT, satellite technologies.
We have both the ingredients of the wireless communication, L1 protocol stack, but as well as a more complete platform solution, what we call PentaG, that delivers the complete L1 for our customers to go and deploy in the marketplace. We have shipped already more than 300 million devices, and in terms of cellular IoT, more than 10 billion, as I mentioned, in smartphone, and overall, significant, seventy million in infrastructure, as I mentioned also previously, but large, large investments of more than 1,000 man-years that have been going to that, enabling us to create a de facto leadership and sustain it. The next is related to sense and immersive audio, capabilities in terms of the experience. We have, and we acquired about 7 months ago, VisiSonics, a company that specialize in 3D spatial audio.
We combine it with our sensor fusion technology to provide a complete 3D spatial audio experience for headsets, head tracker, hearables, wearables, all these type of devices. And also, in addition, we have AI voice assistance and voice clarity to make sure that the overall experience is not just immersive, but very, very high quality. That's what you saw with boAt as a lead partner and a customer, and we see more and more of those customers that we are enabling in the marketplace. The next, and this is, so-called, what everyone talking about, the next frontier, and where we see a very large potential for growth for our company, related to generative AI and ability to run the large networks on the edge. The expectation is that close to 3 billion devices by 2027 will use generative AI at the edge.
It's also expected that 30% of overall those devices will use it as a hybrid model. But that you can see the numbers. In order to run that large neural networks, you need to improve significantly the performance at the edge in terms of 30x more battery consumption or battery efficiency or power efficiency. The compute will go by 10x, and the size of the number of parameters that each of those, each of these networks will use also is very, very large. That means you need to build a scalable neural processing units from an IP perspective, from, in terms of what we offer at CEVA, that can scale up from the lower levels of the market requirements all the way to the highest performance of generative AI running on the edge.
For that, this year, or sorry, in 2023, last year, we announced new NeuPro-M. This is a new architecture for neural processing unit at the edge, running also transformers in order to enable and support generative AI at the edge. This is a very scalable IP in terms of the architecture, which means with the same amounts of R&D and efforts, we can scale up and down in market requirements, going all the way from 10- 1,000 TOPS. Very high performance and low power efficiency. Again, at CEVA, what we are very proud of and what we are doing uniquely, is the ability to develop IP that is a very low power, as well as running correctly the transformers with high performance as it's needed in the different market segments.
And with that, of course, making sure that it's cost-effective in terms of the size of the solution. This is right now in evaluation by many different customers in the different markets that I mentioned previously, and will provide us significant growth opportunities, as we go through 2024 and even way more in 2025 through 2027 and beyond. So to summarize, we have the IP technology across connect, sense, and infer of the different pieces of technologies. What we are enabling our customers is to combine those things and innovate with a fast time to markets, and we'll continue the innovation of this technology for the smart edge with that integration in mind. Let me summarize with all that, why we win and how we are successful in the markets.
So first and foremost, as an IP supplier, we need to invest early on, work very closely with the partners, and the partners and the customer needs to know that we are there for the long run in order to support them. So we are very perseverance with our technologies, with the early investments, and continue. We have done it from 2G all the way now to 5G Advanced. We have done it from Wi-Fi 4 now to Wi-Fi 7. The same for the early days of the Bluetooth, now to later on, Bluetooth 6.0, and from a DSP technology that started now almost two or three decades ago, moving now all the way to the Edge AI with neural networks capabilities, technology.
The other thing is that, as you can see with the Wi-Fi 7 that we just announced, we always strive to be first to markets with those IP, to enable our customer to be first to markets with what they need, and to cut the time to markets. The reason customers come to us, it's either they need a technology they don't have, but also many times they need to go quickly to markets, and we cutting for them lots of the in- early investments or the investments overall, as well as the time to market. And this is very, very important to them and help us to win very nicely. See lots of the different brands out there, down there.
Also, as I mentioned, in terms of the best-in-class, first and foremost, when we design our IP, is about low power with the highest performance trader for that market, and completeness. More and more, we'll keep adding, and you have seen that in the last few years, and we announced several acquisition and additional technology that we added this year to provide more complete portfolio of this type of technology. Still focusing, connect, sense, and infer. Focusing on the smart edge on these four markets, but within that scope, enabling more of the technology that are needed to be integrated. That's how we provide more value to our customers. So now let me go a little bit into the financials.
Some of that, or all of them, we basically shared in the analyst day about a few weeks back, but I'll go through that and highlight a few things. So first, if we look at our revenue in the last few years, we have grown nicely, around 11+% year-over-year. And this year, we haven't closed yet, the 2023. But more importantly, in the past, we have been heavily dependent on the smartphone. But not only dependent on the smartphone as a market, but also on few customers, because smartphone has been consolidated significantly.
But what we have been able to do in the last few years is significant diversification away from handset into the smart edge devices, and the diversification is across both the markets, the technologies that we are offering, and the customer base. So the diversification has helped us to significantly stabilize the business and also not be dependent on one customer or specific market or specific technology. The second is, as we look at different markets, here we are showing on the left side 2019 revenue by... in percentage for consumer IoT in white, for mobile in blue, and for industrial IoT, which includes automotive, infrastructure, and industrial. You can see how in the past few years back, we have been heavily dependent on the smartphone and how this is now got diversified significantly into the consumer IoT.
But also, not less importantly, in the industrial IoT, this is still significant business for us, drive additional growth opportunity, and on average, typically, you can have higher ASP or charge more. Those are more complicated system with a stronger stickiness, that drive that long-term success. So as, as I mentioned previously, we are some, to some degree, walking away from handsets, but diversifying significantly across the consumer IoT and the industrial IoT, providing much better stability and future growth for the company. As we look at what that means in terms of... Just sorry. What it means in terms of some expansion for the company.
Across the connect, sense, and infer, and across the four market segments that I mentioned, we have significant opportunity ahead of us with the technology portfolio that I shared, of about 45% between today and 2027, going to more than $2 billion in overall expansion. This is based on some of already the proof points in terms of market leadership that we have in wireless communication, in DSP technologies, and now with the expansion into AI and immersive sensing capabilities. All these technologies together, the connect, sense, and infer coming together, drive for our significant opportunities moving forward. The other thing related to that, we already have a large established customer base that rely on us, trust us, and looking forward to work with us more and more on the different technologies.
We have more, more than several hundred customers using our technology today, and looking to expand, but even more to expand our offering to this customer base that we already have. In terms of the business model that we have, we are back after we divested the Intrinsix design services to pure IP. This means that now we are around 90% gross margin, and also the focus moving forward, and that's what I drive with the team, is to ensure that as we invest in R&D, as we build those products, we made it such that it's scalable up and down, so we can have a leverage of the our OpEx investments. And with that, as revenue grow, the expenses won't grow linearly with the revenue, and we'll be able to drive more efficiency-...
more operational profitability, and that's also where the royalty, as this keeps adding up, will help us to drive more bottom line success and profitability of the business. So what are the key growth driver? I'll summarize here for everyone in the room. There is the ubiquitous connectivity. We are today already very, very successful in wireless connectivity. But in terms of Wi-Fi and the other technologies, we are still early in the ramp of this technology with our customers. We have more than 40 licensings right now to Wi-Fi. We have more than 60 licensings of Bluetooth, and tens in UWB and others.
Those customers haven't ramped their shipments to the level that is expected in the coming few years, as we have accumulated that success in the markets with our customer base, and we see significant royalty growth opportunities for our Wi-Fi technologies and the other wireless communication technologies. The other things, as I mentioned, we historically have developed our 5G and 5G Advanced technology to the micro base stations, and we see now the propagation of this technology into so-called the industrial IoT, with the reduced capabilities 5G, with the satellite communication technologies. So we'll be able to expand this technology to other markets outside handsets, and this overall will drive higher ASP product mix, 'cause we will have more the higher-end technologies of our wireless communication in terms of the overall mix in our royalty.
As we look at the industrial IoT, I mentioned when we started the presentation about automotive, that we have shipped more than 100 million devices so far, but automotive takes many years. So this is so-called we are in the early phase of that, and we expect more those licensing that we have. We have several tier ones that work with OEMs, that have start deploying our solution for AI, for ADAS systems, and we expect that to ramp nicely in the coming several years. And overall, within the automotive and industrial space, this is where we see significant pipeline opportunity, leveraging what we have from the consumer IoT going into those markets in terms of additional growth opportunity.
AGI, this is a new frontier, not just for us, for many in the industry, as everyone knows, but it is significant growth opportunity. We have already the product, so it's not that we need to develop and get to markets in a few years. NeuPro-M, it's a scalable neural processing unit, ready for GenAI all the way to transformers and generative AI. We have also other solution related, based on our DSP technology for AI, and that hasn't yet materialized in significant revenue, and the expectation as the market really ramps in the coming several years, that that will drive significant growth opportunity for us. Last but not least, software IP. This is where we have added additional investments. We acquired VisiSonics for 3D spatial audio.
We now have the second volume shipments worldwide, customers using this technology, and will ramp nicely in volume over the years, and we expect also other customers to adopt our technology and to drive that growth. So let me summarize all that means, what all that means in terms of our business model moving forward. 2023, we haven't closed yet Q4, but the guidance that we gave to the streets back then means that overall revenue is between $96 million and $98 million, about 89% gross margin, and about $0.13-$0.15 EPS for the year in 2023. 2024 will provide more guidance as we go to the earnings call in February.
But in terms of the long-term model, based on what I've shown here, in terms of the portfolio of technology that we have across connect, sense, and infer, and integration of these technologies, we are expecting revenue growth of between 8% and 12, and 12% CAGR between 2025 and 2027. We are back to above 90% gross margin IP business model, and we expect that to continue. In terms of OpEx expansion, we expect that to grow between 4% and 8% year-over-year. As I mentioned, lots of the technologies that we have already developed are-- is ready to go, so we don't expect that we need to increase OpEx to the same level as the revenue growth.
All the things related to GenAI, all the things related to the immersive sensing and some of the wireless communication, those are the investments that are already in place. With the growth of the revenue, we expect to be able to sustain it while OpEx is not growing to the same level. And that will drive operating margin all the way to about 20%, and we have a target to achieve $1 EPS. Let me summarize the session, and then, of course, I'll be happy to take questions. I'll go counterclockwise from left to right. A few months back, we divested the Intrinsix design services business. My focus with the team is to drive a pure IP business model similar to Arm, where we offer both hardware and software IP to our customer base.
We are addressing high growth, smart edge opportunities. Our focus is consumer IoT, automotive, industrial, and infrastructure. This is where we see more innovation and more growth in the coming few years. We are highly diversified in terms of our customer base, in terms of our markets that we are addressing, and the technology portfolio that we have. I've shown how we transition from smartphone to the smart edge and overall ability to drive it moving forward. We have innovative technologies that we're already winning with the winners in the market, and we expect to continue doing that. Driving with the team a financial disciplines, we have kept the OpEx flat this year in order to drive the top line and operating profits growth as we move forward.
With the cash that we have in hand and no debt, definitely I'm working with the team to see how we expand also inorganically with M and A opportunities. Overall, the IP landscape is such that there are multiple opportunities out there, and the ability to scale IP requires also more integration and scalability of the different assets out there. Thank you very much, everyone. Yeah.
Yeah. Amir, can you talk a little bit about the competitive landscape? So you go to a customer, what are their choices, and how can we perhaps price a little bit more for the value that we're providing? What are they looking at in terms of options instead of CEVA? Is it internal build? Is there another IP set?
Right. So it depends which technology we are talking about. I would say wireless communication, overall, we are the de facto leader in the market. So to the most part, the competition, if there is, is with against so-called internal design. So that's where it's about being early on with the technologies and delivering very good experience to our customers. Also depends on their overall investment portfolio, where they want to invest more or less. This is also why it's important to have the different ingredients, so some of them will have one ingredient but not the others, and then we can come and offer and complement. In terms of the pricing that you asked, we're always looking at whether we can, and that would make sense to so-called adjust pricing.
There is opportunity as we move forward to do some of that, but also the product mix that we are offering will drive a higher average ASP of our offering overall.
It just seems a little frustrating that you're providing a lot of value-
Mm-hmm.
and our royalties are just so meager, and-
Right.
you know, can you do more going forward?
Right.
- with pricing?
Yeah.
It's really something that investors would love to see.
Right. We need to keep in mind that so-called. When you look at the royalty for the last few years, there has been significant migration from the legacy royalty base that was based on handsets, and to replace it with the new technologies. So that has been in the making. But now we see, in addition, that additional growth coming from the wireless communication and technology that we have shipped in the markets, but haven't yet materialized all the way to the high volume royalty, like what we mentioned about Wi-Fi and other technologies. And also this technology, again, if you compare it to the high volume Bluetooth shipments that we have, this is higher royalty per unit. That's why I'm saying the product mix will also drive higher royalty. Yeah.
Just to follow up, you know, the most of your revenues still come from the shipments. It's Bluetooth, which is very low royalty.
Mm-hmm.
And then you have the mobile, which is kind of just counted down.
Right.
If you look in here, if you think that's over 90% of your shipments, when, when are we gonna have the next real big wave from some of these other things? So infrastructure-
Right.
Haven't really come in the-
Right.
Mobile powers.
Right.
So what is the thing that you see that's going to really change the equation so that you really have a higher growth path?
Right.
'Cause this projected growth path is not huge. Is there anything upside to the growth path and upside to maybe having this new royalty stream that can happen as well?
Yeah. So, first, Wi-Fi, we expect to drive significant royalty growth. So we expect to get to the same market share. With roughly today in Bluetooth, we have 30% of the market share outside handsets, so we expect Wi-Fi to get there as well, which on average is about 2x-3x more ASP than Bluetooth. So-
$0.03-$0.01.
Yeah, but significant volume opportunities. The other thing, as I mentioned about the automotive, where we haven't generated significant royalty so far, we have several designs that already so-called are populating in the marketplace, and this is where the volume is smaller than Wi-Fi, but as you said, the average ASP per device that that we get-
What was that again?
Automotive. Yeah.
The value set is a long tail seller.
But we already have been there for the last few years, so so-called our technology is already embedded, and now it's the ramp that will come in the coming one to two, three years, right? Yeah.
I'll just add on that from what Amir is saying. When we talk about our connect, sense, and infer strategy, with this huge customer base in connectivity that we have today, as they're adding more capabilities and integrating more technologies that Amir talked about, we already have a customer base that we can take our technologies and license additional cores, additional applications to, and we're already seeing that happen. Two of the customers that we announced at CES are using us for audio and connectivity. So that's not just a typical low ASP just for Bluetooth, we're now getting an audio socket in addition. As they add more inference capabilities and we have the right solutions, we can continue to license more technologies to our customers, which means more sockets and more royalty revenue.
That's all part of CEVA's strategy under Amir to really reinforce with that customer base that we are their trusted partner for all their connectivity needs, all the needs to do sensing, be it audio, visual, sound, or motion. And on top of that, when you want to take that data and run some sort of AI with it, that we have the right solution to do the inference side of it as well. So this is just step one, I really think, in the strategy under Amir, to really reinforce our IP portfolio with our customer base. And then beyond that, as Amir said, we're looking as well at other ways to scale the business. The IP industry in general is pretty much subscale when you step out from the big, big players like Arm, Cadence, Synopsys, and so on.
After that, there's a lot of companies that are subscale. There's opportunities there that we look at, that potentially we can look at other assets that we can take in, that plug in well with our existing customer base and, and enable us to license that more broadly. These are also part of the strategy and plan that we're trying to look at today.
Yeah. The other thing I would add to your questions is that if you look at our software IP, and that's why I put also more basically focus on the partnership that we just announced with boAt using our technology. On average, the software IP is 5x-10x more royalty than the silicon IP, especially the lower end of the device that you were talking about. And this is also faster time to markets, because their deployment into the end product is faster, and this is also where we work directly with the OEMs, not necessarily with the semiconductor partners, which help to drive more value and more stickiness of the technology. So boAt while it's just starting, they drive very, very significant volume in the market, and that's an example where we can see significant royalty growth. And you can-
Is the software IP on a device basis, or is it more fixed?
No, on a device basis. It's all... The business model is exactly the same, hardware and software. Licensing at the beginning is much lower than hardware for software, but the royalty per unit is higher, and the time to markets in terms of embedding that into the solution is typically faster. 'Cause they can do software upgrades into the device. Yeah. Yeah, definitely. Okay. No more questions? Okay. Thank you very much, everyone. Thank you.