Earnings Call: Q2 2020

Jul 23, 2020

Hello, and welcome to the MaxLinear Second Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen only mode. Session will follow the formal presentation. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Brian Nugent. Please go ahead. Thank you, operator. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss MaxLinear's second quarter 2020 financial results. Today's call is being hosted by Doctor Kishore Sindripu, CEO, and Steve Lutchfield, chief financial officer and chief corporate strategy officer. After our prepared comments, we will take questions. Our comments today include forward looking statements within the meaning of applicable securities laws. Including statements relating to our guidance for third quarter 2020 revenue, 3rd quarter revenue growth expectations and our principal target markets, GAAP and non GAAP gross margin, GAAP and non GAAP operating expenses, tax expense and effective tax rate, and interest and other expense, In addition, we will make forward looking statements relating to trends, opportunities and uncertainties in various product and geographic markets, including, without limitation, statements concerning opportunities arising from our announced definitive acquisition agreement for Intel's Home Gateway Business Growth opportunities for our wireless infrastructure and connectivity markets and opportunities for improved revenues in our broadband markets. These forward looking statements involve substantial risks and uncertainties, including risks related to our proposed acquisition of Intel's Home Gateway Business such as integration and key employee retention risks, as well as those arising more generally from competition Global Trade And Export Restrictions, potential supply constraints, the impact of the COVID-nineteen pandemic, Our dependence on a limited number of customers, average selling price trends, and risks that our markets and growth opportunities may not develop as we currently expect and that our assumptions concerning these opportunities may prove incorrect. More information on these and other risks is outlined the Risk Factors section of our recent SEC filings, including our Form 10 K for the year ended December 31, 2019, and our second quarter 2020 Form 10 Q, which was filed today. Any forward looking statements are made as of today, and MaxLinear has no obligation to update or revise any forward looking statements. The second quarter 2020 earnings release is available in the Investor Relations section of our website at maxlinear.com. In addition, we report certain historical financial metrics, including net revenues, gross margins, operating expenses, income or loss from operations, income taxes, net income or loss, and net income or loss per share on both a GAAP and non GAAP site. We do not provide a reconciliation of non GAAP guidance for future periods because of the inherent uncertainty associated with our ability to project certain future charges, including stock based compensation and its associated tax effects. Non GAAP financial measures discussed today do not replace the presentation of MaxLinear's GAAP Financial Results. We are providing this information to enable investors to perform more meaningful comparisons of our operating results in a manner similar and a replay will be available on the website for 2 weeks. And now, let me turn the call over to Kishore Sindripu, CEO of MacFoneer. Thank you, Brian, and good afternoon, everyone. We are pleased to report Q2 financial results ahead of our initial guidance. Q22 2020 revenue was up 5% sequentially to $65,200,000 with strong gross margins 63.7 percent and operating cash flows of $9,300,000. In Q2, our Connected Home business stood at 45%, infrastructure at 29% and industrial and multi market at 26% of overall revenues. Our business outlook heading into 2nd half is greatly improved with tailwinds in our cable data backed up by strong bookings for Q3. We are benefiting from the demand for greater bandwidth at home in native work from home environment that we believe is an emerging long term trend. We also saw snap back in demand for our high performance analog products following Q1 low. Still in Q2, there were some pockets of weakness due to COVID-nineteen in our wireless backhaul markets. The by the challenges related to COVID, our geographically diverse team is successfully executing on critical strategic engineering initiatives and customer milestones in 5 U wireless optical data center and high performance analog markets. We are excited about our upcoming acquisition of Intel's Home Gateway business, which is expected to close in Q3. This acquisition more than doubled our TAM to about $5,000,000,000. It consists of industry leading DOCSIS 10 GPON Fiber and even at Broadband Access Gateway So technologies, along with the state of the art Wi Fi Six E platform solution. Combined with an ongoing 5G wireless, and optical data center infrastructure initiatives. We are ideally positioned to address all the network bandwidth expansion opportunities and bottlenecks in the cloud as well as into and throughout the home. The rapidly expanding work from home mandates due to COVID-nineteen are driving bandwidth upgrades, which will strongly benefit our core Connected Home business as well as our companion Intel Connected Home division acquisition. Turning to some of the other highlights. In Optical data center, we continue to support the industry's 1st 400 gig PAM4 deployment. At our tier 1 hyperscale datacenter customer. While this ramp has seen a slight delay, we remain encouraged by our customer's progress. And as mentioned earlier, expect to see revenues in the second half of this year. We're also seeing strong adoption and continued progress with Tier 1 customers for our 100 gig PAM4 offering, leading to early revenues in this year. We believe that single Lambda 100 gigabit 100 gigabit PAMPA solutions will torment cloud and edge data center deployments over the next several years, and we are well positioned with our early traction. Turning to 5g wireless infrastructure, I'm excited to announce that we have started sampling our 2nd generation 5g wireless RF transceiver product which is the industry's first 8x8 MIMO RF transceiver in 14 nanometer CMOS. Our 5G RF transceivers have the highest per volumes doubled the bandwidth at 400 Megahertzandsuperior system level integration and power consumption versus competition. We are working aggressively to get our lead customers to market bolstering the confidence in realizing initial 5G revenues in 2020, and strong multi year growth beyond. In wireless control and backhaul transport, we witnessed a slowdown in the first of the year potentially due to COVID-nineteen related installation delays. However, we do expect a pickup starting in Q3. We continue to see a push towards e band spectrum deployments and channel aggregation features. We are in a very good position to capitalize on these favorable trends with our 20 gigabits per secondmillimeter wave dual modem and RF SoCs. We expect multiple OEMs to launch new products with these features in the second half In closing, our organic initiatives in 5g Wireless Optical Data Center And High Performance Analog Markets along with the upcoming interlong gateway business acquisition, we'll uniquely benefit MaxLeer shareholders by investing in expanding target addressable market of challenging broadband connectivity and network infrastructure platform applications. With that, let me turn the call over to Mr. Steve Litchfield, our Chief Financial Officer and Chief Corporate Strategy Officer for a review of the Q2 results and our forward guidance. Thank you, Kishore. I will first review our Q2 2020 results and then further discuss our outlook for Q3 2020. On revenue of $65,200,000, we saw our connected home business down 10% sequentially, materially less than expected with declines in our legacy business, partly offset by the improvement in MoCA demand. Cable data was down slightly. Our infrastructure business grew 15% driven by a strong recovery across our HPA products and an uptick in high speed interconnect demand, offset by continued macro weakness in wireless backhaul deployments. Our industrial and multi market business was up 38% sequentially as demand returned after an unusually weak Q1 owing to the COVID dynamic and related distributor inventory reductions. GAAP and non GAAP gross margins for the first quarter were approximately 50.2% and 63.7 percent of revenue, respectively. This compares to GAAP gross margin guidance of 49.0 percent to 49.5 percent and non GAAP gross margin guidance of 63.5 to 64%. The delta between GAAP and non GAAP gross margins in the 2nd quarter reflects primarily the amortization of eight point $1,000,000 of purchase intangible assets from previous acquisitions. 2nd quarter GAAP operating expenses were approximately $55,500,000, which was slightly above our GAAP guidance of $54,000,000 to 55,000,000 due primarily to higher stock based compensation expense. GAAP operating expenses included stock based compensation rules of $15,200,000 combined. Amortization of purchased intangible assets of $5,500,000 and acquisition costs of $2,100,000. Non GAAP operating expenses were $32,600,000, which was up 900,000 sequentially due primarily to annual merit increases, impacting payroll and higher prototyping expenses, partly offset by lower travel expenses. This was at the low end of the non GAAP guidance of $32,500,000 to 33,500,000 as a result of continued disciplined expense management. We have been successfully managing the spend during the transitional period with trailing 12 months non GAAP OpEx down 11% year over year. Moving to the balance sheet and cash flow statement. Our cash flow generated from operating activities in the second quarter of 2020 was $9,300,000 versus $6,600,000 generated in the 1st quarter 2020. Our load balance remains at $212,000,000 and our net leverage ratio was 1.7 times. We remain consistent in our intentions around our uses of cash with priorities on debt pay down and strategic acquisitions. Our day sales outstanding for the 2nd quarter was approximately 58 days compared to 66 days in the prior quarter. Our inventory turns were flat at Excludes the acquisition of Intel's Home Gateway Business. Approximately $72,000,000 to $76,000,000, up 13.5% sequentially at the midpoint of the guidance range. We expect connected home revenues to be up roughly 20% quarter over quarter with growth driven primarily by cable data. We are expecting tailwinds from the work from home dynamic as well as new customer program ramps in the second half of the year. We are working closely with our suppliers to fulfill the increased demand. We expect infrastructure revenue to be up roughly 10% to 15%, primarily driven by the recovery in backhaul demand after 2 weak quarters. We expect our industrial and multi market to be flat to up 5%. We expect third quarter GAAP gross profit margin to be approximately 51 3.5 percent to 64.5 percent of revenue, up slightly. As a reminder, our gross profit margin percentage forecast could vary plus or minus 2 percent depending on the product mix and other factors. Even as we are focused on reducing our run rate spend levels, we continue to fund strategic development programs targeting at delivering strong top line growth in 2020 and beyond. With particular focus on infrastructure initiatives and our stated goal of increasing the operating leverage in the business. We expect Q3 2020 GAAP operating expenses to increase approximately $5,000,000 quarter on quarter to a range of 60 $61,000,000, driven mainly $400,000 sequentially to a range of $32,500,000 to $33,500,000. We expect GAAP tax expense to be approximately 0 and our non GAAP tax rate of 6%. We expect interest and other expenses in the quarter to be $2,100,000 to 2 $200,000. In closing, we are pleased to report continued progress our infrastructure initiatives with expanding design engagements in the data center market and expanding adoption of our e band modems and RF transceivers the wireless backhaul market and further engineering and customer milestones in our 5G massive MIMO transceiver platform. We're encouraged to see a considerable recovery in our high performance analog offerings as end market dynamics improve from COVID-nineteen impacts. The broadband business, as expected, is seeing a nice recovery in 2020, but the work from home environment is driving an acceleration of this recovery. We remain focused on maintaining strong profitability and cash flow generation, while continuing to execute on our organic infrastructure investments. With these existing initiatives, along with the financially and strategically compelling acquisition in the Intel acquisition, We believe that we're uniquely positioned to deliver strong leverage in our business I'd like to open up the call Our first question today is coming from Quinn Bolton from Needham And Company. Your line is now live. Hey, Keith, short, Steve. Congratulations on the nice results and the strong 3rd quarter outlook. Guys, I wanted to start with the Connected Home business up 20%. Sequentially. Can you give us a sense, is that primarily driven by 1 cable MSO or is it pretty broad based And if it is sort of driven by 1 MSO, do you feel that your share is normalizing that that cable operator with the ramp of the latest generation products? And then I've got a follow-up. Thank you, Quinn. Our demand is is broad based on the operative side. It's not one particular MSO. We are seeing some time expansion happening right now with all the MSOs especially in North America. And we're also well positioned based on the backlog that we are going to start gaining share the other MSO. So and we're also seeing in general a very, very healthy booking for Q3 and beyond we feel very good that the recovery is in progress right now. Great. And then the second question, sounded like the high speed interconnect business was up in the second quarter, but she didn't mention it as a driver of growth in the third quarter. I was wondering You'd mentioned that there might have been a slight delay at your lead 400 gig customer. Can you give us an update there sort of and specifically, are you guys through the interoperability testing at that customer or are you still in the interop test in phase? Thank you. So I think that as we look forward to the uptick of data center, whatever revenues we are speaking about, it's more to give you color how things are progressing, but they're not meaningfully different. It's just a bit volatile based on sample quantities or beyond. We have some revenues in TiEs and drivers that those are the those are the buckets in which we have the high speed connect revenues. So really speaking, we've always talked about these major hyperscale data center transition to 400 Gigabit. We are still in the inter operating phase. When we speak of ours, we talk about our module customers. And really, it's not much in our hands. It's about the qualification process of the hyperscale data center, how these module vendors are progressing with their, they need to reach a certain yields and so on and so forth and reliability of supply. Before that can meaningfully take off. So at this point, at a chip level, we are just supporting our customers as much as we can. But ultimately, they have to be ready with their manufacturing capability. Thank you. Our next question today is coming from Tore Svanenburg. From Stifel. Your line is now live. Yes, thank you. And good job on turning around here. First question on Connected Home. So that business will be slightly more than $30,000,000 in Q3. Could you talk a little bit of, you know, is there still some legacy mix in that 30,000,000 or is it becoming the minimus at this point? Hey, Tore, it's Steve. So I think so the legacy piece is becoming smaller, no doubt about that. And the pickup that we've seen, we highlighted that was really cable data. Some of the weakness that we saw in Q2 was driven by some of the legacy demand, but it is becoming less and less. I mean, one of the legacy areas, I mean, we talked about satellite and that's becoming a much smaller percentage of the business. I mean, consistent with the earlier remarks that'd be less than $10,000,000 this year. Very good. And you mentioned a second generation to telluride I was just hoping maybe you could talk a little bit about what that means from a market perspective, because obviously this is going to be an 8 by 8 part So, and maybe also talk about when you expect that product to generate meaningful revenue? So, Torey, I think, you misspoke, you're referring to 5G wireless. Yes, we launched the first 8x8 MIMO radio transceiver. The industry from a cost perspective has decided that more integration is warranted to reduce the cost of 5G deployments. And as 5G deployments have delayed a bit, the industry's focus has shifted to the 8x8 platform. So sufficy to say that for the most AES application, which is a large, large, MIMO configurations, 8x8 will become the main mainstay. So we are in a competition to be among 3 players, amongst 3 players, who would be who would be sampling this particular chip and we are ahead because of a technology lead in the CMOS note. And at the same time, for us, it was very, very peditius to execute on this 8 by 8 solution, given that our 1st generation products were the 4 by 4. Regarding revenues, we expect the 4x4 to generate initial revenues towards the end of the year and really, mass revenues really are We are counting on the 8x8 to generate when the platform is fully adapted and ramped by the end of the first half of next year, sometime in the middle of next year. Okay. Right. Very good. Just one last one. Could you just give us an update on the timing of the Intel acquisition? You mentioned Obviously, closing in Q3, but any update on the timing and any other hurdles that you have to pass at this point? Yes, Toreen. So, not a whole lot to update here. We are, as we mentioned in the press release, confident that we'll close this in Q3. There's no more regulatory approvals. So comfortable on that front. And so just working through the final work council issues. And so we hope that we'll be announcing that soon. Great. Thank you very much. Thank you. Our next question is coming from Ross Seymore from Deutsche Bank. Your line is now live. Hi. This is Gee for Ross Seymore. Thank you for letting me ask a question. The industrial and multi market, did quite well, growing 38% sequentially. So I guess beyond the third quarter, how do you see the, IMF segment progressing? Was it some pull in of demand, or, I guess, how would characterize IMF for the second half of the year? Yes. Hey, g. So yeah, we did see a nice recovery. We had seen quite a bit of weakness in Q1 of this year. And so we had already seen bookings picking up an early part of the second quarter. And demand remained very strong throughout the quarter and continues today. So I'm encouraged by the recovery that we've seen as we look out in Q4 and into 2021. I mean, I'm optimistic that we start to see this kind of back to some normalcy we definitely thought, I mean, what amounted to as a real snapback at the beginning of the quarter, but demand has continued sell through has been good. And so So like I said, hopefully, we'll see some stabilization in this market soon. Okay. Thank you. And just a housekeeping, I guess, looks like CapEx as well as stock based comp was up sequentially quite a bit. So can you talk about how those should trend in, the 3rd quarter? Yes. I mean, CapEx is consistent with what we've talked about. We've talked about it being about $10,000,000 a year and really no major developments on that front. Stock based comp definitely was up in the quarter. A lot of that was driven by some of the performance shares. And I wouldn't expect that level of an increase in the future. It was down slightly in Q1 definitely saw an increase in Q2, but shouldn't expect to see that going forward. Thank you. Our next question today is coming from Christopher Rolland from Susquehanna. Your line is now live. Hi, it's David Haberle on behalf of Christopher Rolland. Thank you for taking our question. I guess on Connected Homes, as we think about some of the legacy business in headwinds dissipating there. And I understand from Tore's question earlier that this is not de minimis at this point, but you do have a nice strong kind of tailwind from work from home. How are you thinking about growth in this market going forward as connected home? Do you believe it's bottomed here in 2Q? And can growth from work from home trends and and cable offset kind of the legacy headwinds that are that are still ahead of you? Hey, David. Yeah, so it is encouraging. I think coming into this year, we were really expecting this business stabilize and kind of get back to low single digit growth rates in 2021. So work from home, I think, has definitely accelerated that And I think the question to me is, is, I mean, how long does that continue, right? Or how much increased growth that we can see because it doesn't seem like it seems like the economy in general and a lot of the language and many of many companies out there looking for long term solutions with work from home. So I think this could continue for some time. But I think ultimately getting back to this kind of low to mid single digit growth rates is where our expectations would be. But maybe just to I guess, alleviate some concern. I mean, the legacy business, I don't see that as a headwind at all. I mean, really have no problems with that. I mean, this is dominated by the cable data business as well as connectivity. And so I don't see that as a problem. Problematic whatsoever. Understood. Thank you for that. And then for my follow-up, I want to ask about MOCA there's a comment in the queue about, connected home down year over year and partially attributed to MOCA shipments owing to a pause in the ramp think you called out that it was up quarter over quarter. I just want to see if there's any incremental color, on MOCA. Kind of where you stand with your large customer and the ramp And are there other customers, like the breadth of that product? Yeah. Sure. Sure. Yeah. No. Mocha, we're actually very excited about MOCA and that ramp with the large customer, going forward, we definitely saw strong growth in 2019 saw that pause that we had talked about kind of coming into the first half of the year. Those guys are still struggling a little bit with deployments within the work from home environment. And so that has created some, I think, short term issues, but I think those are getting resolved. And that's why we're excited about seeing that pick back up in the second half of Thank you. Our next question today is coming from Tim Savageaux from Northland Capital Markets. Your line is now live. Hey, good afternoon and congrats on the results and outlook. One question. You mentioned, pardon me with an infrastructure, a pickup in high performance analog. I think that's the TIE driver stuff that you referenced. But with backhaul down, I wonder if you could talk a little more granularly about what sort of applications are driving that, pickup in the HPA business. That's question. The other one is did you have any 10% customers in the quarter? And if so, how big? Yes. So with regard to the drivers, I mean, so yes, infrastructure was up quite a bit. A lot of that was driven by the HPA recovery, right? So we had seen some weakness in the first half. Or the first quarter saw a nice improvement there. And I think we expect to see that kind of pick up in the second half. Of the year. And so I mean, as far as giving more granularity, I mean, we've talked about I mean, some of the drivers there server business, for example, there's other business there like, remote radio heads is another one. I mean, there's number of different areas that we sell into infrastructure, but those are probably the 2, largest So, I mean, the one customer that we have is, CommScope. And so they're been the largest and continue to be. Great. Thanks very much. Thank you. Our next question today is coming from Bill Peterson from JP Morgan. Your line is now live. Hi. This is Alex Kim Filing on behalf of Bill Peterson. I just had a question on the infrastructure side, for full year growth outlook, are you still in track for, single digit growth around like 5% to 9% year over year for 2020? I'm sorry, Alex, you're going to have to ask that. You broke up a little bit. Hi. So I just had a question on the infrastructure side. Are you still on track for mid single digit growth around 5% to 9 percent year over year growth for 2020? Yes. So, so we've kind of talked about this a little bit. Just giving 1 quarter's worth of guidance. I mean, coming into Q2, we are expecting to see improvements kind of throughout the rest of the year. And I think we continue to be confident in that. I mean, the one piece that was a little bit different than our expectation was wireless backhaul was weaker than expected in the quarter. But that being said, I think the backlog and the visibility that we have there, we do expect to see nice upticks in Q3 and Q4. Got it. Thank you. And then on the wired side with the Amazon ramp in the second half, what do you think is like the revenue opportunity there? So we haven't broken out exactly what that revenue number would be. I still think it's relatively small numbers in Q3 and Q4. And then start to see a more material contribution in the first half of twenty twenty, twenty twenty one, I'm sorry. Okay, got it. And then what are your thoughts on cloud being sustainable for the second half. I know you mentioned that you've seen a slight delay with your Tier 1 customer. Can you just talk about the overall market in terms of cloud spending being, strong for the second half? Yes. Alex, we're probably not the best to comment on that. But I mean, I think with the regard, we talked about our slight delay, and I think there's a number of reasons, just kind of market environment as a whole, But I would, this is all incremental revenue to MaxLinear. So I don't know that we're kind of the best position to comment because we really don't have any downsides because it's all upside and incremental revenue, to our business. Okay, got it. Thank you so much. Thank you. Our next question today is coming from Ananda Bruva from Loop Capital Markets. Your line is now live. Strong execution. I have 2 if I could. Just starting back out with with Connected Home, sounds like sounds like you guys don't think the longer term growth rate, normalized growth rate, is gonna alter, but you did make mention of share gain opportunities along the way. And if those occur, do you think you can go into those, you know, sort of normalized growth rate to those normalized growth rates from a stronger share position, meaning you can level up your revenue run rate, when that that low to mid single digit growth rate occurs. Does I have a follow-up? Yeah, yeah, no problem. Well, first of all, thanks. Thanks for joining and glad to have you on board here. So, so yeah, I mean, I think the answer is absolutely, right. I mean, we are working hard to sort of commented a little bit on the share gain that we have, we're working diligently to do that. I mean, the call today is really focused around the MaxLinear side and not the acquisition, but it is something that just from an they're being able to add content going forward is a big opportunity as well as share gains. So both of those are a focus for the company. And, we think we've got some good potential to reduce Excellent. Excellent. Thanks for that. And then just the delay that you guys mentioned, is that Is that on the hyperscale cloud side or is that on the telecom side? Can you, can you give any context there? On the hyperscale side. Got it. Okay. Cool. And just is that earlier in one of you in in some of the remarks you made mention of, like, not my paraphrasing, but not to read too much into it. Does is that with regards to the delay, or is that a was that a separate distinction? Can we not collapse this too? So, I'm not sure which part you're referring to. But I mean, with regard to the optical business, the HSI business, we continue to work with a large hyperscale customer excited about seeing these early revenues come in in the second half and then expect to see more material contribution next year. That's awesome. Okay. Thanks so much. Appreciate it. All right. Thank you. Thank you. Our next question is a follow-up from Torzvanberg from Stifel. Your line is now live. Yes, thank you. And I apologize for getting my ski resort mixed up here in the middle of the summer. And thank you for addressing the Blackcomb question. But on Telluride, will there be a follow-up to this product? And I know, Kasher, in the past, I've asked you about the move to 7 nanometer. So, any updates there? So, hey, Tore, of course, there's a follow-up to the the industry trend right now is that on the 400 gig, everybody is going to converge on their I don't want to get into the technical details here, but on the electrical interface today, you know, it's a 50 gigabit electrical interface. Basically, You get 4 by 100 optical lanes, 4 lanes of 100 gigabit, and then the electrical side of 8 lanes of 50 gigabit, the industry is converging towards 4 lanes of 100 gigabit and 4 on the optical side and 4 lanes of 100 gigabit on the electrical side. That's the convergence point next. And that's the next generation chip. That's also called a 400 gigabit PAM4 chip, but there's going to be two flavors of that for the industry. 1 is a 400 gigabit. Another one is going to be 800 gigabit, basically 8 lanes of 100 gig optical lanes and 8 lanes of 100 gig electrical lanes. So yes, we are following through on the next generation ship. And we are working on a fine nanometer solution, not a 7 nanometer solution. And I think it will be the 1st month out with the fine nanometer solution based on what our industry knowledge tells us because we feel that the yields on the 7 nanometer are they do not use EUV lithography and our analysis tells that the power and the yield performance of 5 nanometer is going to be superior to 7 nanometer. The timing will be just right for fan animator. And we have a lot of interest from the industry to do that. Okay. I never mentioned 7 nanometer for that reason. Got it. Okay. No, that's fair. My last question is back to Connected Home. So with this, work from home trend that you're seeing, are you also starting to see new products launch faster from some of your customers. I'm thinking about perhaps XB7 from Comcast, could that potentially be a catalyst in an upgrade cycle for you? And if so, are you starting to see some of those deployments already? Very, very good question, Toree. You're absolutely right. They are trying to accelerate their XB7 take the several versions, but XB-seventy deployments, hopefully we are the beneficiaries of the share shift our ships are wrong. We're gaining our ultimate share. And so that should give us a growth and we're seeing backlog associated with that. Having said that, at the end point, basically, at the customer throughput, that is still not in full steam, but you should expect entered market is shift to a mix piece of it very, very rapidly. And similarly, you're seeing moves being on the Wi Fi side over the other operators to enhance the Wi Fi as well. So XB7 platform benefits from an increased what I call Wi Fi 6E deployment. The reason I talk about this is that it portends very, very well for us because with the acquisition of Intel's Connected Home Assets together with our product portfolio and their gateways, OC, plus their Wi Fi and our MoCA and ethernet and their internet, we would own the full platform. And we should really see a benefit of that share growth, which we have suffered from not having in the last year or so. So yes, that is happening more rapidly, but not rapid enough for us, but it'll okay. We're happy with that, okay? Thank you. We've reached end of our question and answer session. I'd like to turn the floor back over to management for any further or closing comments. Thank you, operator. Just want to note here that we'll be participating at the BMO Virtual Technology Conference in August 24th 28. At the Jefferies 2020 virtual semiconductor IT Hardware And Communication Infrastructure Summit on September 1st 2nd, and the Deutsche Bank Technology Conference at September 14, 15. Just want to reemphasize that all these conferences are virtual. And we hope to connect with many of you there. With that said, I want to thank you all for joining us today and we look forward to reporting on our progress to you next quarter. Hopefully sooner than that. Thank you very much. You. That does conclude today's teleconference. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation.