Credo Technology Group Holding Ltd (CRDO) 2022 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by. (Operator Instructions)

女士們，先生們，謝謝你們的支持。 （操作員說明）

I would now like to turn the conference over to Dan O'Neil. Please go ahead, sir.

我現在想把會議交給 Dan O'Neil。請繼續，先生。

Good afternoon, and thank you all for joining us today on our first earnings conference call as a public company. Joining me today from Credo are Bill Brennan, our Chief Executive Officer, and Dan Fleming, our Chief Financial Officer.

下午好，感謝大家今天加入我們作為上市公司的第一次收益電話會議。今天從 Credo 加入我的有我們的首席執行官 Bill Brennan 和我們的首席財務官 Dan Fleming。

I'd like to remind everyone that certain comments made in this call today may include forward-looking statements regarding expected future financial results, strategies and plans, future operations, the markets in which we operate and other areas of discussion. These forward-looking statements are subject to risks and uncertainties that are discussed in detail in our documents filed with the SEC. It's not possible for the company's manager to predict all risks, nor can the company assess the impact of all factors on its business, or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statement.

我想提醒大家，今天在本次電話會議中發表的某些評論可能包括有關預期未來財務結果、戰略和計劃、未來運營、我們經營所在的市場和其他討論領域的前瞻性陳述。這些前瞻性陳述受我們提交給 SEC 的文件中詳細討論的風險和不確定性的影響。公司經理不可能預測所有風險，公司也無法評估所有因素對其業務的影響，或任何因素或因素組合可能導致實際結果與任何遠期所包含的結果存在重大差異的程度- 外觀聲明。

In light of these risks, uncertainties and assumptions, the forward-looking events discussed during this call may not occur, and actual results could differ materially and adversely from those anticipated or implied. The company undertakes no obligation to publicly update forward-looking statements for any reason, after the date of this call to conform to these statements to actual results or to changes in the company's expectations except as required by law.

鑑於這些風險、不確定性和假設，本次電話會議期間討論的前瞻性事件可能不會發生，實際結果可能與預期或暗示的結果存在重大不利差異。公司不承擔以任何理由公開更新前瞻性陳述的義務，在本次電話會議之後，以使這些陳述符合實際結果或公司預期的變化，除非法律要求。

Also during this call, we will refer to certain non-GAAP financial measures, which we consider to be an important measure of the company's performance. These non-GAAP financial measures are provided in addition to and not as a substitute for or superior to financial performance prepared in accordance with U.S. GAAP. A discussion of why we use non-GAAP financial measures and reconciliations between our GAAP and non-GAAP financial measures is available in the earnings release we issued today as well as in our S1, which both can be accessed using the investor relations portion of our website.

同樣在本次電話會議中，我們將參考某些非公認會計準則財務指標，我們認為這是衡量公司業績的重要指標。這些非公認會計原則財務措施是對根據美國公認會計原則編制的財務業績的補充，而不是替代或優於其提供的。我們今天發布的收益報告和 S1 中討論了我們為什麼使用非 GAAP 財務指標以及我們的 GAAP 和非 GAAP 財務指標之間的對賬，這兩者都可以使用我們的投資者關係部分進行訪問網站。

With that, I'll now turn the call over to our CEO. Bill?

有了這個，我現在將把電話轉給我們的首席執行官。賬單？

Thanks, Dan. I want to thank you all for joining our call. Since this is our first earnings call as a public company, I'd like to start with a brief description of what we do. Credo is a pure play high speed connectivity company. Our goal is to deliver high speed solutions to break bandwidth barriers on every wired connection in the data infrastructure market. We've initially targeted the leading edge Ethernet market that's driven by the hyperscalers data centers. We're pursuing an exponential growth curve and speed and that's driving a large, fast growing market that because of its degree of difficulty, is a natural filter on competition. We're building our connectivity solutions to enable these explosive bandwidth increases for every optical and copper connection in the data center. Market forecasters expect the high end of the Ethernet market to grow at almost 50% per year. And we expect this will create a $5 billion plus Ethernet TAM for us by 2025.

謝謝，丹。我要感謝大家加入我們的電話會議。由於這是我們作為上市公司的第一次財報電話會議，我想先簡要介紹一下我們的工作。 Credo 是一家純粹的高速連接公司。我們的目標是提供高速解決方案，打破數據基礎設施市場中每個有線連接的帶寬障礙。我們最初的目標是由超大規模數據中心驅動的前沿以太網市場。我們正在追求指數增長曲線和速度，這推動了一個龐大、快速增長的市場，由於其難度，它是競爭的自然過濾器。我們正在構建我們的連接解決方案，以便為數據中心中的每個光纖和銅線連接實現這些爆炸性的帶寬增長。市場預測者預計以太網市場的高端市場將以每年近 50% 的速度增長。我們預計到 2025 年，這將為我們創造一個價值 50 億美元的以太網 TAM。

Beyond data centers, we have seen other markets begin to experience exponentially increasing speed demands. And we see that as a great opportunity for us to expand beyond Ethernet. I'll talk a little bit more about that opportunity later. Core to our platform is our SerDes technology. High-speed SerDes is a very high hurdle technology that requires leading-edge high-performance analog design and signal processing, and it requires doing it with very low power. We are fortunate to have a team with decades of experience designing to just this type of challenge. With extraordinary focus on optimizing the mix of analog design and DSP, we can deliver differentiated connectivity solutions with optimized power efficiency and cost effectiveness at the highest speeds. This is why we've been successful in engaging with a broad customer base that includes several major hyperscalers, networking OEMs and ODMs as well as optical module manufacturers.

除了數據中心之外，我們還看到其他市場開始經歷指數級增長的速度需求。我們認為這是我們擴展到以太網之外的絕佳機會。稍後我會多談談這個機會。我們平台的核心是我們的 SerDes 技術。高速 SerDes 是一項非常高門檻的技術，需要領先的高性能模擬設計和信號處理，並且需要非常低的功耗。我們很幸運擁有一支擁有數十年設計經驗的團隊來應對此類挑戰。我們非常注重優化模擬設計和 DSP 的組合，能夠以最高速度提供具有優化的能效和成本效益的差異化連接解決方案。這就是為什麼我們成功地與包括幾家主要超大規模製造商、網絡 OEM 和 ODM 以及光學模塊製造商在內的廣泛客戶群打交道的原因。

I would like to give a brief overview of our Ethernet connectivity solutions. The first set of Credo solutions I'd like to talk about are Active Electrical Cables or AECs. We began development more than 4 years ago, and we've been the pioneer in establishing this new category of connectivity solutions. We targeted our first efforts to enable disaggregated racks in the switching and routing layers in the data center. The traditional way of making these connections has been with passive copper cables, known as DACs. Now the problem with DACs, when you move to 56 gig single lane speeds to support either 400 gig or 200 gig ports is that the signal integrity becomes a huge challenge. Also, the thickness, weight and bend radius of the DACs make it very difficult to install and service, especially when you've got installers trying to route more than 200 large cables within very tight space in the front and the side of the rack. The loss of signal integrity though is the real issue with DACs.

我想簡要介紹一下我們的以太網連接解決方案。我想談論的第一組 Credo 解決方案是有源電纜或 AEC。我們在 4 年多前開始開發，我們一直是建立這種新型連接解決方案的先驅。我們的首要目標是在數據中心的交換和路由層啟用分解機架。進行這些連接的傳統方法是使用無源銅纜，即 DAC。現在 DAC 的問題是，當您轉向 56 gig 單通道速度以支持 400 gig 或 200 gig 端口時，信號完整性成為一個巨大的挑戰。此外，DAC 的厚度、重量和彎曲半徑使其安裝和維修非常困難，尤其是當安裝人員試圖在機架前部和側面非常狹窄的空間內佈線 200 多根大電纜時。然而，信號完整性的損失是 DAC 的真正問題。

Now we see the 200 gig and 400 gig market as a crossover generation, where some companies will commit to the struggle with DACs, but many others will move to AECs due to the signal integrity and form factor advantages. However, at 112 gig single lane speeds to support 800 gig ports, we firmly believe that DACs are dead. We also have a growing family of AEC solutions that target server racks with connections from the server NIC to the ToR switch. We're delivering highly innovative solutions driven by our hyperscaler partners. For example, in a collaborative effort with Microsoft, we recently introduced the Switch AEC, which enables a hitless dual ToR architecture. Our switch AEC is able to detect when a ToR port is failing and then instantly switch the data flow to the redundant ToR switch. This kind of innovation is simply not possible with DACs or Active Optical Cables known as AOCs. And over time, we're going to continue to add other equally innovative NIC to ToR AEC solutions to our portfolio.

現在我們將 200 gig 和 400 gig 市場視為交叉一代，一些公司將致力於與 DAC 的鬥爭，但由於信號完整性和外形尺寸優勢，許多其他公司將轉向 AEC。然而，以 112 gig 單通道速度支持 800 gig 端口，我們堅信 DAC 已死。我們還擁有越來越多的 AEC 解決方案系列，這些解決方案以服務器機架為目標，從服務器 NIC 連接到 ToR 交換機。我們正在提供由我們的超大規模合作夥伴推動的高度創新的解決方案。例如，在與 Microsoft 的合作中，我們最近推出了 Switch AEC，它支持無中斷雙 ToR 架構。我們的交換機 AEC 能夠檢測到 ToR 端口何時出現故障，然後立即將數據流切換到冗餘 ToR 交換機。這種創新對於 DAC 或稱為 AOC 的有源光纜是根本不可能的。隨著時間的推移，我們將繼續將其他同樣創新的 NIC 添加到我們的產品組合中的 ToR AEC 解決方案。

Next, I'd like to talk about our solutions for optical modules. The first products we developed are optical DSPs that cover all the optical module deployments today in the hyperscaler data centers, including 100 gig, 200 gig and 400 gig and in the future, 800 gig. In addition to our full family of optical DSPs that we're promoting to the data centers, we're also promoting single lane 50 gig optical DSPs for the 5G infrastructure market as well as 64 gig single lane optical DSPs for the fiber channel market. Over time, you'll also see Credo expanding our optical solutions in the future, starting with laser drivers. This week at OFC in San Diego, we announced and are demonstrating our first laser driver solutions.

接下來，我想談談我們的光模塊解決方案。我們開發的第一批產品是光學 DSP，涵蓋了當今超大規模數據中心中所有光學模塊部署，包括 100 gig、200 gig 和 400 gig 以及未來的 800 gig。除了我們正在向數據中心推廣的全系列光學 DSP 之外，我們還在為 5G 基礎設施市場推廣單通道 50 gig 光學 DSP 以及面向光纖通道市場的 64 gig 單通道光學 DSP。隨著時間的推移，您還將看到 Credo 在未來擴展我們的光學解決方案，從激光驅動器開始。本週在聖地亞哥的 OFC 上，我們宣布並正在展示我們的第一個激光驅動器解決方案。

Next, I would like to talk about our Line Card PHYs. These are solutions optimized for the copper connections needed by switch line card makers for backplane and front panel connections. We also see emerging high-speed server applications as an opportunity. We're selling our Retimers, Gearboxes as well as MACsec devices, devices that provide encryption for applications where security is critical. We've got a complete family of solutions covering the 100 gig, 200 gig and 400 gig port markets. And this week, we announced our products for the 800 gig and 1.6 T port markets.

接下來，我想談談我們的線卡 PHY。這些解決方案針對開關線卡製造商在背板和前面板連接中所需的銅連接進行了優化。我們還將新興的高速服務器應用程序視為一個機會。我們正在銷售我們的重定時器、齒輪箱以及 MACsec 設備，這些設備為安全至關重要的應用程序提供加密。我們擁有涵蓋 100 gig、200 gig 和 400 gig 端口市場的完整解決方案系列。本週，我們宣布了面向 800 gig 和 1.6 T 端口市場的產品。

Finally, Credo has SerDes IP license and chiplet solutions, which we've delivered to highly regarded customers across various end markets. While we are primarily a product company, we believe our IP and chiplet solutions are very strategic, enabling us to engage in highly collaborative relationships with industry-leading customers. We count more than 30 customers that have chosen our SerDes IP and chiplet solutions.

最後，Credo 擁有 SerDes IP 許可和小芯片解決方案，我們已經向各個終端市場的備受推崇的客戶提供了這些解決方案。雖然我們主要是一家產品公司，但我們相信我們的 IP 和小芯片解決方案非常具有戰略意義，使我們能夠與行業領先的客戶建立高度協作的關係。我們統計有 30 多家客戶選擇了我們的 SerDes IP 和小芯片解決方案。

When we talk about our competitive advantage, we start with a term called [N-1] in reference to the process technology that we're using to deploy our solutions. For any given speed, we can engineer a solution in a more mature process and N-1 process technology. And that gives us an advantage on development cost as well as our wafer cost. This is where optimizing analog and DSP architectures and doing it all with low power and very small die sizes results in a remarkable value proposition for our customers. This is a true differentiator for Credo.

當我們談論我們的競爭優勢時，我們從一個稱為 [N-1] 的術語開始，它指的是我們用於部署我們的解決方案的工藝技術。對於任何給定的速度，我們都可以在更成熟的工藝和 N-1 工藝技術中設計解決方案。這使我們在開發成本和晶圓成本上都具有優勢。這就是優化模擬和 DSP 架構並以低功耗和非常小的裸片尺寸完成所有這些工作，從而為我們的客戶帶來非凡的價值主張。這是 Credo 的真正差異化因素。

Next we bring a purpose-built mentality to our solutions. We don't view every link as a one-size-fits-all technology challenge. We engineer solutions that are optimized for the many different links we serve. We've got optimized solutions for optical as well as the many different types of copper links in the data center. We've got a wide range of SerDes architectures to address the many different links. We have both mixed signal and DSP architectures that are optimized for speed, power as well as die size. We believe we're the world's leader in mixed-signal architectures, and we believe we are the most highly differentiated company for DSP architectures, especially at 112 gig speeds and beyond.

接下來，我們為我們的解決方案帶來一種專門構建的心態。我們並不認為每一個環節都是千篇一律的技術挑戰。我們設計的解決方案針對我們服務的許多不同鏈接進行了優化。我們已經為數據中心中的光纖以及許多不同類型的銅纜鏈路提供了優化的解決方案。我們有廣泛的 SerDes 架構來處理許多不同的鏈接。我們擁有混合信號和 DSP 架構，針對速度、功率和芯片尺寸進行了優化。我們相信我們是混合信號架構的世界領導者，我們相信我們是 DSP 架構最具差異化的公司，尤其是在 112 gig 及以上的速度下。

The final source of our competitive advantage is system expertise. We focus on delivering system-level end-to-end signal integrity. We've also developed a tightly coupled (inaudible) base that adds system design flexibility, and we're driving leading-edge system level test solutions. I'd point to our AEC family as evidence of the fact that we've gone very far with our system-level mentality. We're delivering a complete system solution versus just an IC solution.

我們競爭優勢的最終來源是系統專業知識。我們專注於提供系統級的端到端信號完整性。我們還開發了一個緊密耦合（聽不清）的基礎，增加了系統設計的靈活性，並且我們正在推動領先的系統級測試解決方案。我會以我們的 AEC 家族作為證據，證明我們在系統級思維方面已經走得很遠。我們提供的是完整的系統解決方案，而不僅僅是 IC 解決方案。

All of this boils down to Credo delivering optimized signal integrity, power efficiency and cost effectiveness. This is really the key to our success. We feel that our customer engagement is the best validation of our differentiation because when our customers choose to engage with Credo, they're choosing to bet their next-generation platform on our execution, ultimately, it takes a huge amount of trust to make that kind of decision. We're engaged with 5 of the top 7 hyperscalers, and we count more than 20 additional blue-chip clients that include networking OEMs, ODMs as well as optical transceiver manufacturers and many others. So I'm very happy with where we are with customers.

所有這一切歸結為 Credo 提供優化的信號完整性、電源效率和成本效益。這確實是我們成功的關鍵。我們認為我們的客戶參與是對我們差異化的最佳驗證，因為當我們的客戶選擇與 Credo 互動時，他們選擇將他們的下一代平台押在我們的執行上，最終，需要巨大的信任才能做到這一點種決定。我們與前 7 大超大規模廠商中的 5 家進行了合作，並且我們統計了 20 多個額外的藍籌客戶，其中包括網絡 OEM、ODM 以及光收發器製造商等。因此，我對我們與客戶的關係感到非常滿意。

Now let's talk about new opportunities that we see within our sites that are beyond the Ethernet market. Other connectivity standards in the data infrastructure market are also experiencing an exponentially increasing demand for higher speed and higher bandwidth. We're committed to serving the most demanding high-speed markets where we can deliver the same advantages in power efficiency and cost effectiveness. So in addition to the Ethernet market, Credo will deliver high-speed connectivity solutions for the USB and PCIe markets. Our solutions are targeting next-generation speeds, so it will be some time before we ramp our products. Our go-to-market strategy will be similar to our strategy for Ethernet, leading with IP licensing and following with products.

現在讓我們談談我們在我們的站點中看到的超出以太網市場的新機會。數據基礎設施市場中的其他連接標準也在經歷對更高速度和更高帶寬的指數級增長的需求。我們致力於為要求最嚴苛的高速市場提供服務，在這些市場中，我們可以提供同樣的能效和成本效益優勢。因此，除了以太網市場，Credo 還將為 USB 和 PCIe 市場提供高速連接解決方案。我們的解決方案以下一代速度為目標，因此我們還需要一段時間才能推出產品。我們的上市戰略將類似於我們的以太網戰略，以 IP 許可為先導，以產品為後盾。

I'm happy to say that we've signed our first major USB IP license, and that's with an industry leader in the consumer market. We expect these 2 markets will bring us more opportunity and diversity in our customer base, and we believe this will add roughly $3 billion in TAM in the 2025 time frame. Of course, none of our goals will be obtainable without our tremendous team of employees. We've scaled our organization very quickly over the past several years, and we now employ well over 350 people globally. This team enabled us to achieve strong results in fiscal third quarter ended January 31, 2022. During this most recent quarter, we achieved approximately $31.8 million in revenue and delivered gross margins at approximately 61%.

我很高興地說，我們已經簽署了我們的第一個主要 USB IP 許可，而且是與消費市場的行業領導者簽署的。我們預計這兩個市場將為我們的客戶群帶來更多機會和多樣性，我們相信這將在 2025 年的時間框架內增加大約 30 億美元的 TAM。當然，如果沒有我們龐大的員工團隊，我們的任何目標都將無法實現。在過去幾年中，我們的組織規模迅速擴大，現在我們在全球擁有超過 350 名員工。這個團隊使我們在截至 2022 年 1 月 31 日的第三財季取得了強勁的業績。在最近一個季度，我們實現了約 3180 萬美元的收入，毛利率約為 61%。

With that introduction, I'd now like to turn the call over to Dan Fleming, our CFO, to provide more details on our January quarter results.

通過該介紹，我現在想將電話轉給我們的首席財務官 Dan Fleming，以提供有關我們 1 月份季度業績的更多詳細信息。

Thank you, Bill, and good afternoon. I will first review our Q3 fiscal '22 results and then discuss our outlook for Q4 fiscal '22. As a reminder, the following financials will be discussed on a non-GAAP basis, unless otherwise noted.

謝謝你，比爾，下午好。我將首先回顧我們的 22 財年第三季度業績，然後討論我們對 22 財年第四季度的展望。提醒一下，除非另有說明，否則以下財務將在非公認會計原則的基礎上進行討論。

I'm pleased to share with you that we achieved record revenue of $31.8 million, up 20% sequentially and up 136% year-over-year. This record result was largely driven by strong revenue growth of our products, which also reached a record of $26.7 million for the quarter, up 35% sequentially and up 190% year-over-year. Our product revenue ramp is at an inflection point as our revenue mix shifts from being IP focused to product focused. This revenue mix shift is first being driven by our AEC products, which continue to ramp at our first hyperscale data center customer. Our largest customer in the quarter was 40% of total revenue, which was associated with this AEC ramp. We expect this customer to remain a large portion of our revenue in the coming quarters as their AEC ramp continues.

我很高興與您分享，我們實現了創紀錄的 3180 萬美元收入，環比增長 20%，同比增長 136%。這一創紀錄的業績主要得益於我們產品的強勁收入增長，該季度也達到創紀錄的 2670 萬美元，環比增長 35%，同比增長 190%。隨著我們的收入組合從以 IP 為重點轉向以產品為重點，我們的產品收入增長正處於一個拐點。這種收入組合轉變首先是由我們的 AEC 產品推動的，這些產品繼續在我們的第一個超大規模數據中心客戶中增長。本季度我們最大的客戶佔總收入的 40%，這與 AEC 的增長有關。我們預計，隨著 AEC 的持續增長，該客戶在未來幾個季度仍將是我們收入的很大一部分。

Our IP business generated $5.1 million of revenue in Q3, up 20% year-over-year. IP will remain a strategic part of our business, but our IP results will vary from quarter-to-quarter, driven largely by specific deliverables to preexisting contracts. While the mix of IP and product revenue will fluctuate in any given quarter over time, our revenue mix in Q3 was 16% IP, slightly above our long-term expectation for IP, which is 10% to 15% of revenue. Against the backdrop of a challenging supply chain environment, our team delivered gross margin of 60.7%, up 20 basis points sequentially and up 43 basis points year-over-year. Our IP gross margin generally hovers just below 100%, and our product gross margin was 53.5% in Q3, up 564 basis points sequentially and up 867 basis points year-over-year based largely on leverage from our strong product growth.

我們的 IP 業務在第三季度創造了 510 萬美元的收入，同比增長 20%。知識產權仍將是我們業務的戰略組成部分，但我們的知識產權結果將因季度而異，主要受現有合同的特定交付成果的推動。雖然 IP 和產品收入的組合會隨著時間的推移在任何給定季度波動，但我們在第三季度的收入組合為 16%，略高於我們對 IP 的長期預期，即佔收入的 10% 至 15%。在充滿挑戰的供應鏈環境的背景下，我們的團隊實現了 60.7% 的毛利率，環比增長 20 個基點，同比增長 43 個基點。我們的 IP 毛利率一般徘徊在 100% 以下，我們的產品毛利率在第三季度為 53.5%，環比增長 564 個基點，同比增長 867 個基點，主要基於我們強勁的產品增長的槓桿作用。

Total operating expenses in the third quarter were $18.2 million, up 51% year-over-year as we scaled the organization for growth, but slightly down sequentially as certain R&D project-related spending slipped into Q4. We delivered net income of $2.4 million in Q3. Net income expanded by 20 percentage points sequentially and 41 percentage points year-over-year, a testament to the operating leverage we are driving in the business. Our earnings per share was $0.03 in Q3, up $0.10 year-over-year. Cash flow from operations in the third quarter was $1.7 million, an increase of $7.1 million year-over-year. CapEx was $2.9 million in the quarter and free cash flow was negative $1.2 million, an improvement of $7 million year-over-year. We ended the quarter with cash and equivalents of $240.5 million, an increase of $169.5 million over the second quarter. This increase in cash came from the net proceeds of our successful IPO completed in January.

第三季度的總運營費用為 1820 萬美元，同比增長 51%，因為我們擴大了組織規模以實現增長，但由於某些與研發項目相關的支出滑入第四季度，環比略有下降。我們在第三季度實現了 240 萬美元的淨收入。淨收入環比增長 20 個百分點，同比增長 41 個百分點，這證明了我們在業務中推動的經營槓桿。第三季度我們的每股收益為 0.03 美元，同比增長 0.10 美元。第三季度運營現金流為 170 萬美元，同比增長 710 萬美元。本季度資本支出為 290 萬美元，自由現金流為負 120 萬美元，同比增長 700 萬美元。我們在本季度末的現金和等價物為 2.405 億美元，比第二季度增加了 1.695 億美元。現金的增加來自我們在 1 月份完成的成功 IPO 的淨收益。

Our accounts receivable balance declined 25% sequentially to $21.7 million, while days sales outstanding declined to 71 days, down from 101 days in Q2. Our Q3 ending inventory was $26.1 million, up $4.8 million sequentially as we continue our sequential product ramp.

我們的應收賬款餘額環比下降 25% 至 2170 萬美元，而未償銷售天數從第二季度的 101 天下降至 71 天。我們的第三季度期末庫存為 2610 萬美元，比上一季度增加了 480 萬美元，因為我們繼續我們的連續產品增長。

Now turning to our guidance for the fourth quarter. We currently expect revenue in Q4 fiscal '22 to be between $37 million and $41 million, up 97% year-over-year at the midpoint. We expect Q4 gross margin to be within a range of 59% to 61%. We expect Q4 operating expenses to be between $21 million and $23 million, including the R&D project-related spend that slipped from Q3. And finally, we expect Q4 weighted average diluted share count to be approximately 158 million shares.

現在轉向我們對第四季度的指導。我們目前預計 22 財年第四季度的收入將在 3700 萬美元至 4100 萬美元之間，中點同比增長 97%。我們預計第四季度的毛利率將在 59% 至 61% 的範圍內。我們預計第四季度的運營費用將在 2100 萬美元至 2300 萬美元之間，包括與第三季度相比下滑的研發項目相關支出。最後，我們預計第四季度加權平均攤薄股數約為 1.58 億股。

And with that, I will open it up to questions.

有了這個，我將提出問題。

(Operator Instructions) Our first question comes from the line of Vivek Arya with Bank of America.

（操作員說明）我們的第一個問題來自美國銀行的 Vivek Arya。

And congratulations on achieving the IPO milestone during such a tough time for the market. So a few for you. First, on the AEC market, from what we heard at the recent OFC trade show, seems the size and growth of the market could be larger than previously thought, but we also heard of some incremental competition from Marvell and maybe others. So maybe give us a perspective of how large AEC is for you today? Where can it go over time? And how do you see this emerging competition?

並祝賀在市場如此艱難的時期實現 IPO 里程碑。所以給你一些。首先，在 AEC 市場上，從我們在最近的 OFC 貿易展上聽到的情況來看，似乎市場的規模和增長可能比以前想像的要大，但我們也聽說來自 Marvell 和其他公司的一些增量競爭。那麼，也許可以讓我們了解一下今天 AEC 對您來說有多大？隨著時間的推移，它會去哪裡？您如何看待這種新興的競爭？

Yes, that's a great question. Very much appreciate it. Let me talk about the -- what you saw down at OFC in San Diego. So Marvell made an announcement that they're entering the AEC market in a big way, and we think this is great. [Matt] and his team have a strong track record for making good decisions, and we think that he's made another good one. I'll say that this is an important thing for the AEC market in general. For the past several years, many of our potential competitors have been dismissive of the AEC market opportunity, even going as far as to evangelizing a world that will become exclusively optical. And so we see their announcement as a great validation that Marvell and others agree with our long-held belief that AECs really deliver great advantages and will become a de facto solution for short in-rack connections in the future, especially as speeds go beyond 400 gig. And so at OFC, this is where we're demonstrating our AEC solutions, including the 800 gig.

是的，這是一個很好的問題。非常感謝。讓我談談你在聖地亞哥的 OFC 看到的。因此，Marvell 宣布他們正在大舉進軍 AEC 市場，我們認為這很棒。 [Matt] 和他的團隊在做出正確決定方面有著良好的記錄，我們認為他又做出了一個很好的決定。我會說這對整個 AEC 市場來說是一件重要的事情。在過去的幾年裡，我們的許多潛在競爭對手一直對 AEC 市場機會不屑一顧，甚至還宣傳了一個將完全變成光學的世界。因此，我們認為他們的聲明是一個很好的驗證，即 Marvell 和其他人同意我們長期以來的信念，即 AEC 確實提供了巨大的優勢，並將成為未來短機架內連接的事實上的解決方案，尤其是在速度超過 400演出。因此，在 OFC，我們展示了我們的 AEC 解決方案，包括 800 gig。

And I'd be honest with you, Marvell's announcement couldn't come at a better time because it drove huge excitement and interest in our booth.

老實說，Marvell 的宣布來得正是時候，因為它激發了人們對我們展位的極大興奮和興趣。

And so kind of reflect a bit on our belief with our approach. And we've talked about pioneering this product category. We were the first to really invest in a big way. And as a result, we took really a system-level approach. We've built a team internally at Credo that focuses exclusively on the AEC system solution. And so we take responsibility for all aspects, including definition, execution, qualification, quality and reliability of our solutions. And we are fully standing behind our AECs. We're taking the full responsibility with our customers. And so we think this approach has been critical to our success thus far, and we're intending on increasing our investment over time.

因此，我們的方法有點反映了我們的信念。我們已經討論過開創這一產品類別。我們是第一個真正大舉投資的人。因此，我們採用了真正的系統級方法。我們在 Credo 內部建立了一個團隊，專門專注於 AEC 系統解決方案。因此，我們對所有方面負責，包括我們解決方案的定義、執行、資格、質量和可靠性。我們全力支持我們的 AEC。我們對客戶承擔全部責任。因此，我們認為這種方法迄今為止對我們的成功至關重要，我們打算隨著時間的推移增加我們的投資。

Now as far as the size of the market, we've talked about this being a market in the 2025 time frame that is in the $3 billion range annually. Now I think that as different data centers move towards faster speeds in the switching and routing layer as well as in their server racks, you may see that market increase in size. It's kind of hard to peg it right now. I think that we're comfortably sitting with a 100% market share as we're the first to really come out of the gate in high volume. But I think, generally, we're really focused on the large opportunity that's in front of us during the next couple of years.

現在就市場規模而言，我們已經談到這是一個 2025 年時間框架內的市場，每年在 30 億美元的範圍內。現在我認為隨著不同的數據中心在交換和路由層以及它們的服務器機架中朝著更快的速度發展，你可能會看到市場規模的擴大。現在有點難以把握。我認為我們很舒服地坐擁 100% 的市場份額，因為我們是第一個真正大批量生產的公司。但我認為，總的來說，我們真正專注於未來幾年擺在我們面前的巨大機遇。

And for my follow-up, maybe, Dan, one for you on gross margin. How do you see the evolution of gross margins for the next several quarters as your mix changes perhaps more to the product side? And as part of that, if you could just help me clarify the gross margin that you reported because when I take the 19.565 in non-GAAP COGS and divide it by (inaudible) I actually get 61.5% gross margin, not 60.7%. Maybe I'm just missing something simple there, but if you could clarify that and just give us your perspective on how gross margin evolves this year?

對於我的後續行動，丹，也許是毛利率給你的。隨著您的組合可能更多地向產品方面變化，您如何看待未來幾個季度的毛利率演變？作為其中的一部分，如果您能幫我澄清您報告的毛利率，因為當我將非 GAAP COGS 中的 19.565 除以（聽不清）時，我實際上得到了 61.5% 的毛利率，而不是 60.7%。也許我只是遺漏了一些簡單的東西，但如果你能澄清這一點，並告訴我們你對今年毛利率如何發展的看法？

Yes. That's a great -- I'm glad you pointed that out, Vivek, because I like your number more than ours. We had -- because of the way our non-GAAP reporting is done, you might have noticed in the reconciliation, there is a warrant contra revenue item. So for non-GAAP purposes, we add back that contra revenue. So when you're calculating gross margin, you need to make sure you add that back to the denominator in your calculation. So that's the difference between the 60.7% and the 61.5%. So while we have this warrant outstanding and there is contra revenue, we'll continue to recognize revenue on -- or sorry, recognize gross margin on this more conservative approach.

是的。太好了——我很高興你指出了這一點，Vivek，因為我更喜歡你的號碼而不是我們的號碼。我們有 - 由於我們的非公認會計原則報告的完成方式，您可能已經在對賬中註意到，有一個權證對沖收入項目。因此，出於非公認會計原則的目的，我們加回了對沖收入。因此，當您計算毛利率時，您需要確保將其添加回計算中的分母。這就是 60.7% 和 61.5% 之間的差異。因此，雖然我們有未完成的認股權證並且有相反的收入，但我們將繼續確認收入 - 或者抱歉，以這種更保守的方法確認毛利率。

Getting to your broader question, our outlook has not really changed significantly since we last spoke. From -- let me highlight a few things. From Q1 to Q3 of this year, of fiscal '22, our product gross margin, if you calculate that, it's actually expanded more than 900 basis points, a nice expansion sequentially each quarter. And that's largely been driven by our increasing scale as we ramp these new products, especially the AEC product. But now we expect these gross margins to expand from this point forward on a -- in the upcoming years, but we don't expect it to be a purely linear expansion.

談到你更廣泛的問題，自我們上次發言以來，我們的前景並沒有真正發生重大變化。從——讓我強調一些事情。從今年第一季度到第三季度，在 22 財年，我們的產品毛利率，如果你計算一下，它實際上擴大了 900 多個基點，每個季度都有很好的增長。這在很大程度上是由於我們不斷擴大規模，因為我們推出了這些新產品，尤其是 AEC 產品。但現在我們預計這些毛利率將在未來幾年從這一點開始擴大，但我們預計這不會是純粹的線性增長。

So there will be some margin variation from quarter-to-quarter as we're ramping different products and different customers over the course of time. But if we look kind of in a longer view over the next few years, our product gross margins will continue to expand as we gain scale. And really what that's driven by is the relatively fixed portion of COGS becomes a smaller percentage of total COGS. In addition, these product mix changes over the upcoming years will continue to drive margin expansion as well. For instance, optical will become a larger revenue contributor in FY '23 and '24, where that's just starting to ramp currently in FY '22.

因此，隨著我們隨著時間的推移增加不同的產品和不同的客戶，每個季度的利潤率都會有所不同。但如果我們在未來幾年放眼長遠，隨著規模的擴大，我們的產品毛利率將繼續擴大。真正驅動的是 COGS 的相對固定部分在總 COGS 中所佔的百分比較小。此外，未來幾年的這些產品組合變化也將繼續推動利潤增長。例如，光學將在 23 財年和 24 財年成為更大的收入貢獻者，而目前在 22 財年才剛剛開始增長。

And then the last thing I'll mention on margin expansion, in our view, is just the market dynamics of the AEC market, when we get to 400 gig AEC cables, we believe that there's a -- it's a very favorable margin expansion story at that point because of different market dynamics.

在我們看來，關於利潤率擴張，我要提到的最後一件事就是 AEC 市場的市場動態，當我們達到 400 gig AEC 電纜時，我們相信這是一個非常有利的利潤率擴張故事那時因為不同的市場動態。

Our next question comes from the line of Toshiya Hari with Goldman Sachs.

我們的下一個問題來自高盛的 Toshiya Hari。

Congrats on the whole process and the strong execution in the quarter. Bill, I wanted to ask you about the supply side of the equation. Obviously, very tricky times for everyone out there. And during the IPO process, I think you expressed your confidence in your ability to secure supply, whether it be wafers or substrates or what have you. I was hoping to get an update on the outlook there for the next couple of quarters. It feels like things have gotten a little bit more difficult, a little bit more challenging over the past couple of months. But how are you feeling about supply and your ability to address demand for the next, call it, 6 to 12 months? And then I've got a quick follow-up.

祝賀整個過程和本季度的強大執行力。比爾，我想問你關於供應方面的問題。顯然，對於那裡的每個人來說，這是非常棘手的時期。在 IPO 過程中，我認為您表達了您對確保供應的能力的信心，無論是晶圓還是基板，或者您擁有什麼。我希望在接下來的幾個季度中獲得有關前景的最新信息。在過去的幾個月裡，感覺事情變得更加困難，更具挑戰性。但是，您對供應和滿足下一個需求的能力感覺如何，稱之為 6 到 12 個月？然後我有一個快速跟進。

Sure. Sure. Thank you, and thanks for the question. I love the question because it kind of points out another strength that I believe that we've built as we've built the company over the last several years. We've got a deeply experienced operations team that really has deep relationships within the supply chain. A lot of people were starting to treat the supply chain strategically when we first started seeing tightness. We really -- we go back to 2016 time frame when this team was really forming. And so we've taken a strategic approach. We've always stayed very close in terms of our business plan and our forecast with our supply chain. And so really about 12 to 18 months ago, we really formed a much more structured long-term planning approach. And so I feel very good about where we are. I think that even beyond the next couple of quarters, I see no issues with supporting our very quick ramp.

當然。當然。謝謝你，謝謝你的問題。我喜歡這個問題，因為它指出了我相信我們在過去幾年建立公司時建立的另一個優勢。我們擁有一支經驗豐富的運營團隊，在供應鏈中有著深厚的關係。當我們第一次看到供應緊張時，很多人開始戰略性地對待供應鏈。我們真的 - 我們回到 2016 年這個團隊真正組建的時間框架。所以我們採取了戰略方法。在我們的商業計劃和我們對供應鏈的預測方面，我們一直非常接近。大約在 12 到 18 個月前，我們確實形成了一種更有條理的長期規劃方法。所以我對我們所處的位置感覺很好。我認為即使在接下來的幾個季度之後，我認為支持我們的快速增長也沒有問題。

Another thing I'd like to point out is that we've got a deeply experienced customer-facing team. And so the supply chain challenges have been something that we've gone to our customer base with in a sense of bringing a more structured planning approach on that end of it. And so believe it or not, I think that the tightness here has drawn us closer to our supply chain as well as drawn us closer to our customer base. So I feel confident at this point that we're not going to see disruptions.

我想指出的另一件事是，我們擁有一支經驗豐富的面向客戶的團隊。因此，供應鏈挑戰一直是我們向客戶群提出的問題，從某種意義上說，我們為此帶來了一種更有條理的規劃方法。不管你信不信，我認為這裡的緊張讓我們更接近我們的供應鏈，也讓我們更接近我們的客戶群。所以我在這一點上充滿信心，我們不會看到中斷。

That's great. And then as my follow-up, I had a question on the AEC business as well. In your prepared remarks, you mentioned that you had a 40% customer in the quarter, and obviously, that customer is doing a lot with you guys in AEC. How should we think about the broadening of your customer base within AEC over the next couple of years? Again, I suspect this specific customer to be the vast majority of your business in the near term. But if you can talk a little bit about sort of the design-in activity and the back and forth you're having with customers, specifically in AEC, that would be super helpful.

那太棒了。然後作為我的後續行動，我也有關於 AEC 業務的問題。在您準備好的評論中，您提到您在本季度擁有 40% 的客戶，顯然，該客戶在 AEC 與你們一起做了很多事情。我們應該如何考慮在未來幾年內擴大您在 AEC 內的客戶群？同樣，我懷疑這個特定客戶在短期內將成為您業務的絕大部分。但是，如果您能談一談設計活動的種類以及您與客戶的來回交流，特別是在 AEC 中，那將非常有幫助。

Right, right. Another good question. And so generally, let me say that we're really happy about the AEC ramp with that customer, and it really speaks to the overall growth potential, of the overall AEC market opportunity. And so I think you can kind of look at this that this is really the nature of being a small, truly disruptive company in a fast-growing market. There's always going to be a first mover as the new innovative product categories brought to market, proven and ultimately adopted by the first one. And so from our perspective, this is really a validation. And it's really unavoidable that a small company entering a fast-growing market with a limited number of players, it's -- we expected to see a high customer concentration as the revenue scales.

是的是的。另一個好問題。因此，總的來說，讓我說我們對 AEC 與該客戶的合作感到非常高興，這確實說明了整體 AEC 市場機會的整體增長潛力。因此，我認為您可以看到，這確實是在快速增長的市場中成為一家小型、真正具有顛覆性的公司的本質。隨著新的創新產品類別推向市場，經過驗證並最終被第一個產品採用，總會有先行者。所以從我們的角度來看，這確實是一個驗證。一家小公司進入一個快速增長的市場，參與者數量有限，這是不可避免的，我們預計隨著收入的增加，客戶集中度會很高。

And so we believe, really long term, that all hyperscalers will use AECs in some form or fashion, whether in the switching and routing layers or in the server racks, especially as singling speeds increase. And so the question that you ask is when are we going to ramp our second big customer. And we think that's coming in the upcoming quarters. I will say that we're deeply engaged with the second hyperscaler and things have progressed very quickly. And so this is, again, it's more validation. We're also engaged with several other customers in the whole conversation about AECs. This product category is really quite unique in a sense that we're entering into architectural level discussions with the hyperscalers for their next-generation deployments. So the answer to your question is, I see really within the upcoming quarters, we'll ramp our second large customer. And then over time, I see the opportunity expanding really more broadly.

因此，我們相信，從長遠來看，所有超大規模廠商都將以某種形式或方式使用 AEC，無論是在交換和路由層還是在服務器機架中，尤其是隨著單機速度的提高。所以你問的問題是我們什麼時候才能增加我們的第二個大客戶。我們認為這將在未來幾個季度到來。我要說的是，我們與第二個超大規模處理器深入合作，事情進展得非常快。因此，這又是一種驗證。在關於 AEC 的整個對話中，我們還與其他幾位客戶進行了交流。從某種意義上說，這個產品類別確實非常獨特，因為我們正在與超大規模廠商就他們的下一代部署進行架構級別的討論。所以你的問題的答案是，我真的看到在接下來的幾個季度裡，我們將增加我們的第二個大客戶。然後隨著時間的推移，我看到機會真正擴大到更廣泛的範圍。

Our next question comes from the line of Quinn Bolton with Needham.

我們的下一個問題來自 Quinn Bolton 和 Needham 的觀點。

I'll offer my congratulations on the IPO and the first successful quarter post. Bill, I wanted to, again, follow-up on the AEC market. As you walked the floor at OFC, are you seeing any of the AEC competitors looking to develop a switch AEC that could serve as a second source to your product line? And then a follow-up question, you mentioned, I think, today you're ramping 100 gig AECs at your first customer. Dan mentioned, as you get to 400 gig AEC, the margin profile increases dramatically. Can you just give us a sense from a timing perspective, when do you think you start to ship some of the higher-speed AECs, especially the 400 gig and 800 gig AEC versions?

我將祝賀首次公開募股和第一個成功的季度發布。比爾，我想再次跟進 AEC 市場。當您在 OFC 走訪時，您是否看到任何 AEC 競爭對手希望開發可作為您產品線第二來源的交換機 AEC？然後是一個後續問題，你提到，我想，今天你正在為你的第一個客戶增加 100 gig AEC。 Dan 提到，當您達到 400 gig AEC 時，保證金情況會急劇增加。您能否從時間的角度告訴我們，您認為您什麼時候開始發布一些更高速的 AEC，尤其是 400 gig 和 800 gig AEC 版本？

Yes. I'll make one correction. I think Dan meant to say the 800 gig is really where we see an opportunity. And it's really a shift from single lane speeds being 56 gig, shifting to 100 gig single lane speeds. And so please make note of that. The -- I think that the way that we view the opportunity is really there's 2 distinct markets. One market is in the NIC to ToR server racks. And then the other one is with disaggregated chassis or disaggregated switch racks and routers as well. And so that's really -- we're shipping to customers. These customers are smaller. They're not the top 7, but we've had customers make a very, very quick decision to adopt our technology. And so we're shipping in production for 400 gigs. But it's not material in a sense of comparing it to our first NIC to ToR customer.

是的。我會做一個更正。我認為丹的意思是說 800 場演出確實是我們看到機會的地方。這實際上是從 56 gig 的單車道速度轉變為 100 gig 的單車道速度。所以請注意這一點。 - 我認為我們看待機會的方式實際上是有兩個不同的市場。一個市場是 NIC 到 ToR 服務器機架。然後另一種是分離的機箱或分離的交換機機架和路由器。所以那是真的 - 我們正在運送給客戶。這些客戶規模較小。他們不是前 7 名，但我們已經讓客戶非常、非常迅速地決定採用我們的技術。因此，我們正在為 400 個演出交付生產。但從某種意義上說，它與我們的第一個 NIC 到 ToR 客戶相比並不重要。

And so it's really a function of each data center, when they really make the conversion and ultimately it comes down to an architectural decision. And so I think that what we'll see is during the next, say, 12 to 18 months, we'll start shipping in a much bigger way for the 400 gig.

因此，當他們真正進行轉換並最終歸結為架構決策時，這實際上是每個數據中心的功能。所以我認為我們將看到在接下來的 12 到 18 個月內，我們將開始以更大的方式為 400 gig 發貨。

And anything on this competition wise to the switch AEC that you provide?

對於您提供的交換機 AEC，這場比賽有什麼明智的嗎？

Well, of course, our data center customers, of course, they want multiple sources. This is part of the rules of the road for them. And so we've had a couple of competitors try to come up with the switch AEC that we're shipping in production. I think one of the competitors hit the end of the road, and they're no longer trying to build the solution. But I think there's another company that has possibly delivered samples and is in the process of trying to get qualified.

好吧，當然，我們的數據中心客戶，當然，他們想要多個來源。這是他們道路規則的一部分。因此，我們有幾個競爭對手試圖提出我們在生產中交付的交換機 AEC。我認為其中一個競爭對手已經走到了盡頭，他們不再試圖構建解決方案。但我認為還有另一家公司可能已經交付了樣品，並且正在努力獲得資格。

And then just moving to the line card ICs. You guys introduced the Sparrow and Heron retimers and gearboxes this week. Can you just give us a sense, I think at least one of them is currently sampling or maybe already shipping in production, but can you give us a sense of the timing for the revenue ramp on those new solutions?

然後只是轉移到線卡 IC。你們這週介紹了 Sparrow 和 Heron 重定時器和變速箱。您能否給我們一個感覺，我認為其中至少有一個目前正在提供樣品，或者可能已經在生產中發貨，但是您能否告訴我們這些新解決方案的收入增長時機？

Well, it's really -- it's going to be based on when the 100 gig -- the 100 gig single line switches start shipping. And so I think, generally, we're encouraged. Our line card business is a very nice business for us. It was the first business that we ramped and it's very stable and steady. It's not maybe the largest market opportunity, but we think that the trend towards faster singling speed on switches will drive growth in the market. So I think we're really very well positioned when that market takes off. It's hard for me to guess, but I would say that it's going to be maybe more than 6 to 12 months from now.

嗯，這真的 - 它將基於 100 gig 的時間 - 100 gig 單線交換機開始發貨。所以我認為，總的來說，我們受到鼓勵。我們的線卡業務對我們來說是一項非常好的業務。這是我們開展的第一個業務，它非常穩定和穩定。這可能不是最大的市場機會，但我們認為開關單速度更快的趨勢將推動市場增長。所以我認為當這個市場起飛時，我們真的處於非常有利的位置。我很難猜測，但我會說從現在起可能會超過 6 到 12 個月。

Our next question comes from the line of Tore Svanberg with Stifel.

我們的下一個問題來自 Tore Svanberg 和 Stifel。

This is actually Jeremy calling in for Tore. A question, I guess, on the -- following up on the Sparrow and Heron and specifically for the retime, the Heron. Is there -- are there any advantages in pairing it with your high wire AECs, whether on the AEC side or on the line card side?

這實際上是傑里米在召喚托雷。一個問題，我猜，關於- 跟進麻雀和蒼鷺，特別是重播，蒼鷺。將它與您的高線 AEC 配對是否有任何優勢，無論是在 AEC 端還是線卡端？

Yes. So that's -- it's interesting. I'll also note that some of the 100 gig per lane switches will go with a 2 RU form factor on the front panel and they'll use 400 gig ports. And so that's in an effort to try to get to market quickly without having to wait for 800 gig solutions to be available. And so the Heron part, there's a gearbox mode where it can receive 100 gig lanes from the switch and then it can speed shift to 50 gig lanes for the 400 gig modules.

是的。這就是——這很有趣。我還要注意，每通道 100 gig 的交換機中的一些將在前面板上採用 2 RU 外形尺寸，它們將使用 400 gig 端口。因此，這是為了嘗試快速進入市場，而無需等待 800 個演出解決方案可用。所以蒼鷺部分，有一個變速箱模式，它可以從開關接收 100 個演出通道，然後它可以為 400 個演出模塊快速切換到 50 個演出通道。

And so naturally, if you're using a combination of products, there's going to be extremely straightforward interop. But again, we're building -- the whole industry is building towards an IEEE standard. And so I wouldn't expect that there's a huge advantage. We're not building in secret features if we're following the standards. So I would expect that it would be very straightforward, maybe more straightforward than connecting with another solution, but no huge advantage.

因此很自然，如果您使用產品組合，就會有非常簡單的互操作性。但同樣，我們正在建設——整個行業都在朝著 IEEE 標準建設。所以我不認為會有巨大的優勢。如果我們遵循標準，我們就不會構建秘密功能。所以我希望它會非常簡單，可能比連接另一個解決方案更簡單，但沒有太大的優勢。

And then as we look to opportunities beyond Ethernet, you mentioned USB and PCIe and with the first customer on the consumer side. Can you tell us, for USB, can you tell us what kind of applications specifically you see ramping first? And then over time, what's the balance between USB and PCIe in terms of the TAM?

然後，當我們尋找以太網以外的機會時，您提到了 USB 和 PCIe，以及消費者方面的第一個客戶。你能告訴我們，對於 USB，你能告訴我們你首先看到的具體應用是什麼類型的應用嗎？然後隨著時間的推移，就 TAM 而言，USB 和 PCIe 之間的平衡是什麼？

Good question. And so I think that the folks that follow the standards in the USB space know that there's typically a doubling of speed every generation. And we expect that laptops, tablets will be the first application that adopted the fastest speeds. We expect that the peripherals that you plug in to laptops or tablets will need to go to that same speed to really take advantage for the applications that want to take advantage of the bandwidth. And then I think there's a large market in cabling as well. Because of that speed, there is a necessity to have some sort of active solution for cables that are over even 2 feet or less. So we expect those will be the first markets to ramp. And I think there are other applications that will drive high bandwidth that will follow.

好問題。因此，我認為遵循 USB 領域標準的人都知道，每一代的速度通常都會翻一番。我們預計筆記本電腦、平板電腦將是第一個採用最快速度的應用程序。我們預計您插入筆記本電腦或平板電腦的外圍設備將需要達到相同的速度，才能真正利用想要利用帶寬的應用程序。然後我認為佈線也有很大的市場。由於這種速度，有必要為甚至超過 2 英尺或更短的電纜提供某種有源解決方案。因此，我們預計這些市場將是第一批崛起的市場。而且我認為還有其他應用程序將推動隨後的高帶寬。

And TAM expectations in terms of USB versus PCIe.

以及 TAM 在 USB 與 PCIe 方面的期望。

We see that USB has the larger potential. I would probably break it down to maybe 60% to 65% of that number that I said would be TAM driven by USB and then the balance would be for PCIe.

我們看到USB具有更大的潛力。我可能會將其分解為我所說的由 USB 驅動的 TAM 的 60% 到 65%，然後餘額將用於 PCIe。

Congrats on a great quarter.

祝賀一個偉大的季度。

Our next question comes from the line of Vijay Rakesh with Mizuho.

我們的下一個問題來自瑞穗的 Vijay Rakesh。

Hello, Bill and Dan, I'll add my congratulations on a solid IPO and a good first quarter here. Just on the -- on your visibility. I was wondering, your peers have talked about very strong visibility into first half. So just wondering how your visibility was. And if you -- how the backlog looks like as well? And I have a follow-up.

你好，比爾和丹，我要在這裡祝賀首次公開募股和良好的第一季度。就在你的知名度上。我想知道，您的同行已經談到了上半年非常強大的知名度。所以只是想知道你的知名度如何。如果你 - 積壓的情況如何？我有一個後續行動。

Yes. So just to make sure that we understood your question. You're asking about our visibility in the first half as well as…

是的。所以只是為了確保我們理解你的問題。你問的是我們上半年的知名度以及……

Yes, as you look out.

是的，當你向外看的時候。

Yes. So as I mentioned before, part of the process that we've gone through with our customers due to the supply chain challenges is to really get as far a look possible at what their demand profile will be. And so I would say that we've got good visibility right now. And we're on a very regular basis, trying to refresh that visibility with our customer base. It is critical to make sure that we've got products that we can supply. So I think that our visibility is probably better now than it was prior to the kind of supply chain tightness.

是的。因此，正如我之前提到的，由於供應鏈挑戰，我們與客戶一起經歷的部分過程是真正盡可能地了解他們的需求概況。所以我想說我們現在有很好的知名度。我們會定期嘗試更新我們的客戶群的可見性。確保我們擁有可以供應的產品至關重要。所以我認為我們現在的能見度可能比供應鏈緊張之前更好。

And on the -- going back on the Marvell question, I know they are doing this probably with Amphenol. But I think where you differentiate is, you have a much more integrated cable that goes in sync with your SerDes steps. And obviously a much broader portfolio with speed and phase shift and (inaudible) as you have noted before. But it also took 2-plus years to kind of get this out in the feet and qualify it, right? So is that -- shouldn't that be a pretty significant proprietary moat for you going forward? That's it.

關於 - 回到 Marvell 的問題，我知道他們可能正在使用 Amphenol 這樣做。但我認為你與眾不同的地方在於，你有一個與你的 SerDes 步驟同步的集成度更高的電纜。顯然，正如您之前提到的，具有速度和相移和（聽不清）的更廣泛的產品組合。但也花了 2 年多的時間才把它搞定並獲得資格，對吧？那麼——這不應該是你前進的一個非常重要的專有護城河嗎？而已。

Yes. It's a very good question. And I can speak to our approach. I don't feel great about speaking towards a competitor's approach and playing that game. What we found as we were in development on these AEC solutions is that it was not straightforward to hand off our device to a partner and expect a partner to take it forward, even if I provide the firmware as a starting point. And so that's why we quickly decided to assemble our own team internally that took ownership of every aspect of the design, all the way through qualification. We defined the test, the equipment that's used to test our cables. We wrote all the firmware for the test. We wrote all the firmware on the cable side. We optimize every single pair of wires for signal integrity as part of our manufacturing process. But we are defining every step.

是的。這是一個很好的問題。我可以談談我們的方法。面對競爭對手的方法和玩那個遊戲，我感覺不太好。我們在這些 AEC 解決方案的開發過程中發現，將我們的設備交給合作夥伴並期望合作夥伴推進它並不簡單，即使我提供了固件作為起點。這就是為什麼我們很快決定在內部組建自己的團隊，負責設計的各個方面，一直到資格認證。我們定義了測試，用於測試我們的電纜的設備。我們為測試編寫了所有固件。我們在電纜端編寫了所有固件。作為我們製造過程的一部分，我們優化了每一對電線的信號完整性。但我們正在定義每一步。

And so we felt like taking the full responsibility and really standing behind it with our customer base was the right approach, very similar to our IC solutions. It's the single throat to choke mentality. If something happens to go wrong, you can't be pointing at each other saying, it's not my problem. And so this is our approach. And we feel like it was critical for our success. It's not to say that others couldn't overcome the hurdles of trying to divide the work and divide the responsibility.

因此，我們覺得承擔全部責任並真正支持我們的客戶群是正確的方法，與我們的 IC 解決方案非常相似。這是扼殺心態的唯一喉嚨。如果發生了什麼事，你們不能指著對方說，這不是我的問題。這就是我們的方法。我們覺得這對我們的成功至關重要。這並不是說其他人無法克服試圖分工和分工的障礙。

(Operator Instructions) Our next question comes from the line of Suji Desilva with ROTH Capital.

（操作員說明）我們的下一個問題來自 ROTH Capital 的 Suji Desilva。

Hello, Bill, hello, Dan. So the initial customer that's ramping up here. Can you talk about whether there's an initial ramp volume or whether it should be steady going forward, Dan, in terms of this lead customer that's kicked in initially?

你好，比爾，你好，丹。所以這裡的初始客戶正在增加。丹，您能否談談最初啟動的主要客戶是否存在初始坡道量，或者是否應該穩定向前發展？

Yes. Unfortunately, we can't really talk about specifics about customer engagements like that at that level of detail.

是的。不幸的是，我們不能在那個細節級別上真正談論有關客戶參與的細節。

I would probably add that we're in the early stages of the ramp. We expect it to continue to ramp throughout the calendar year. And it's really a function of their own plan. And that's ultimately, we're trying to stay as close as possible, and we're getting forecasts that go out in time even to the order of 12 months. And so I think it's something you'll see continuing to ramp.

我可能會補充一點，我們正處於斜坡的早期階段。我們預計它將在整個日曆年繼續增長。這實際上是他們自己計劃的一個功能。最終，我們正努力保持盡可能接近，我們得到的預測甚至可以達到 12 個月的時間。所以我認為你會看到它繼續上升。

And then just for the other customers that are coming, following on, can you remind us the length of the qualification cycle on average? And is that what is going around right now? Or is it more driven by the customers transitioning to various platforms that would bring you in? Any distinction there would be helpful.

然後對於即將到來的其他客戶，您能否提醒我們平均資格週期的長度？這就是現在正在發生的事情嗎？還是更多地由客戶過渡到將您帶入的各種平台驅動？那裡的任何區別都會有所幫助。

Sure. So it's very interesting. If we look at some of the cables that we're targeting for the switching and routing layers. These are 400 gig or 200 gig solutions. And it's really great because when a customer decides to qualify the cables, it is a very straightforward thing. We ship them enough cables to build a rack. They have some of the rack, they qualify the solution, and they can begin production really quickly. So from start to production could be as short as 6 months because this is a fully baked solution.

當然。所以這很有趣。如果我們看一下我們針對交換和路由層的一些電纜。這些是 400 gig 或 200 gig 解決方案。這真的很棒，因為當客戶決定對電纜進行鑑定時，這是一件非常簡單的事情。我們向他們運送足夠的電纜來構建機架。他們有一些機架，他們對解決方案進行了驗證，他們可以很快開始生產。因此，從開始到生產可能只需 6 個月，因為這是一個完全成熟的解決方案。

When we're looking at a line card design, you get involved in the first stages of a big switch maker laying out their PCB. And sometimes it takes on the order of 18-plus months to go from first effort to production. And so it's really nice, the work on the AEC, because it is a system solution has done before and it can be very quickly qualified. The first ramp that we've had, this was really a collaborative effort. This was one where kind of core to our values are the concept of listening to customers, helping them solve problems and making them successful.

當我們查看線卡設計時，您會參與大型開關製造商佈局 PCB 的第一階段。有時從第一次嘗試到生產需要 18 個月以上的時間。 AEC 上的工作真的很棒，因為它是一個以前做過的系統解決方案，並且可以很快獲得認證。我們擁有的第一個坡道，這確實是一項協作努力。我們的價值觀的核心是傾聽客戶的意見，幫助他們解決問題並取得成功。

And so this is an opportunity where we earned enough credibility for our customer to approach us and say, "Do you think this is possible. And from start to production was on the order of 18 months in that case. But again, this is evidence of the fact that there's real innovation opportunities that have never been seen before because nobody has really taken approach to make an active solution like we have.

所以這是一個機會，我們贏得了足夠的信譽，讓我們的客戶接近我們並說，“你認為這是可能的嗎？在那種情況下，從開始到生產大約需要 18 個月。但同樣，這是證據事實上，存在前所未有的真正創新機會，因為沒有人像我們一樣真正採取方法來製定積極的解決方案。

And so I will say that the second effort that we've got underway, the second engagement is in a -- it's a similar type of engagement, where they're not picking up a standard cable that we've developed. It's something that's, again, an idea that comes from listening to our customers and helping them solve their problems. And so that one is not going to ramp so quickly. But I would say in the upcoming quarters, we'll see the initial ramp.

所以我會說，我們正在進行的第二次努力，第二次參與是在 - 這是一種類似的參與，他們沒有拿起我們開發的標準電纜。再次，這是一個來自傾聽我們客戶並幫助他們解決問題的想法。這樣一來，它就不會如此迅速地上升。但我想說，在接下來的幾個季度，我們會看到最初的增長。

Our next question comes from the line of Richard Shannon with Craig-Hallum.

我們的下一個問題來自 Richard Shannon 與 Craig-Hallum 的對話。

Congratulations on the first quarter out of the gate here. Maybe I'll just ask a quick tactical question for Dan on the guidance here. I think you're suggesting from your prepared remarks that cables will be the kind of the big sequential driver here. So I just wanted to check to see if that conclusion is right and if you're expecting IC growth, product IC growth to also grow. And then just kind of as a corollary to that, you talked about a 40% customer in the last quarter. Is it safe to think of this concentration being at least with that high in the April quarter as well?

恭喜第一季出這裡。也許我會就這裡的指導向 Dan 提出一個快速的戰術問題。我認為您從準備好的評論中暗示，電纜將成為這裡的主要順序驅動器。所以我只是想看看這個結論是否正確，如果你期望 IC 增長，產品 IC 的增長也會增長。然後作為一個推論，你談到了上個季度 40% 的客戶。認為這種集中度至少在 4 月季度也達到如此高的水平是否安全？

Yes, those are all astute questions. We -- the last question, yes, we would expect in Q4 a similar type of concentration as customers are going through that ramp right now. And as far as what's driving growth in Q4 in our guidance, it really is, you're correct in your assessment. It really is AEC. We expect our IP revenue to be relatively healthy as well. And generally speaking, yes, you're accurate. You're correct.

是的，這些都是精明的問題。我們 - 最後一個問題，是的，我們預計第四季度會出現類似的集中度，因為客戶現在正在經歷這個坡道。至於我們指導中推動第四季度增長的因素，確實是，您的評估是正確的。真的是AEC。我們預計我們的 IP 收入也將相對健康。一般來說，是的，你是準確的。你是對的。

Bill, a question for you, since I had heard a question here on your optical ramps here. Just want to get your latest update, especially as your team goes through OFC and your thought process and timing of when you're expecting to see a real ramp-up in production volumes on the TAM for DSP side?

比爾，問你一個問題，因為我在這裡聽到了一個關於你的光坡道的問題。只是想獲得最新的更新，尤其是當您的團隊經歷 OFC 以及您的思考過程和時間安排時，您希望看到 DSP 方面的 TAM 產量真正增加？

Sure. Yes, it's been a big week for us at OFC. We've got a large team down in San Diego. We feel like we're in great position on our optical products, and this is a product development that is a little bit longer in nature to get to production because we've got to get through qualification with our customers, and they've got to get through qualifications with the hyperscalers. I'm happy to say that we've started production shipments to several customers. Not a material amount of revenue yet. It's small, but we do expect that the large number of design engagements that are ramping in the upcoming quarters will generate material revenue in our fiscal year '23. And so it's also interesting. We've got solutions that cover the 50 gig per lambda market as well as the 100 gig per lambda market.

當然。是的，這對我們在 OFC 來說是重要的一周。我們在聖地亞哥有一支龐大的團隊。我們覺得我們在我們的光學產品上處於有利地位，這是一個產品開發本質上要花一點時間才能投入生產，因為我們必須通過客戶的資格認證，他們已經通過超大規模的資格認證。我很高興地說，我們已經開始向幾個客戶發貨。還沒有實質性的收入。它很小，但我們確實預計，在接下來的幾個季度中，大量設計業務將在我們的 23 財年產生實質性收入。所以這也很有趣。我們的解決方案涵蓋每個 lambda 市場 50 gig 以及每個 lambda 市場 100 gig。

And going back 5 or 6 years or so, I was new to the market and the market was basically -- the forecasters were saying that 100 gig per lambda is coming, and that's the only market that you should target. Ultimately we made the decision to invest in 50 gig per lambda. And although many industry watchers believe that the 50 gig per lambda market was cast in stone, we're now playing the role of disruptor. We've got multiple engagements, including 200 gig, 400 gig, singling 50 for 5G and also 64 gig for fibre Channel. And so it shows that although it's important to be on the leading edge, there's still great opportunity in existing markets.

回溯 5 或 6 年左右，我是市場新手，市場基本上是 - 預測者說每個 lambda 100 gig 即將到來，這是你應該瞄準的唯一市場。最終，我們決定為每個 lambda 投資 50 gig。儘管許多行業觀察家認為每個 lambda 市場 50 gig 是一成不變的，但我們現在扮演著顛覆者的角色。我們有多個參與，包括 200 gig、400 gig、5G 單選 50 和光纖通道 64 gig。因此它表明，儘管處於領先地位很重要，但現有市場仍然存在巨大的機會。

And I think everybody is aware that 3 major data centers are going with a 200 gig module approach for their ramping next-generation architecture. We also have several design engagements for 100 gig per lambda, including both 100 and 400 gig. Down at OFC this week, we're demonstrating a broad set of our solutions, including 200 gig, 400 gig, 800 gig as well as the single lane products I described. I'll note that our module partners played a big role in helping us with demonstrations. II-VI, Accelink, [CIG], Hisense, Luxshare and [ONET] all provided Credo-based modules that are being demonstrated this week. So I think a little bit more on it. I think key to this market is driving best performance with best power efficiency and doing it with the best possible cost. It can make or break the customers in this market, depending on how cost-effective your solution is.

而且我想每個人都知道，3 個主要的數據中心正在採用 200 gig 模塊的方法來實現他們不斷發展的下一代架構。我們還有幾個設計項目，每個 lambda 為 100 gig，包括 100 gig 和 400 gig。本週在 OFC 上，我們展示了一系列廣泛的解決方案，包括 200 gig、400 gig、800 gig 以及我描述的單通道產品。我會注意到我們的模塊合作夥伴在幫助我們進行演示方面發揮了重要作用。 II-VI、光迅科技、[CIG]、海信、立訊精密和 [ONET] 都提供了本周正在演示的基於 Credo 的模塊。所以我想多了一點。我認為這個市場的關鍵是以最好的功率效率驅動最好的性能，並以盡可能好的成本做到這一點。它可以成就或破壞這個市場的客戶，這取決於您的解決方案的成本效益。

And so we are demonstrating 800 gig at OFC and I'll say that we're probably never going to win the competition on press releases. We're just a little bit more conservative in our approach. But I'm really confident that we'll have equal or better performance in power. But for sure, we're going to deliver the most cost-effective solution. And that's really based on our N-1 process approach.

所以我們在 OFC 展示了 800 場演出，我會說我們可能永遠不會在新聞稿上贏得比賽。我們的方法稍微保守一點。但我非常有信心，我們將在功率方面擁有相同或更好的表現。但可以肯定的是，我們將提供最具成本效益的解決方案。這實際上是基於我們的 N-1 流程方法。

I'm showing no further questions in the queue. I would now like to turn the call back over to Bill for closing remarks.

我沒有在隊列中顯示更多問題。我現在想把電話轉回給比爾做結束語。

Yes. So thank you, everybody, for participating -- actively participating in our first earnings call. We very much appreciate your ongoing interest in Credo. So with that I'll say take care until the next time we talk.

是的。所以，謝謝大家的參與——積極參與我們的第一次財報電話會議。我們非常感謝您對 Credo 的持續關注。因此，我會說要小心，直到我們下次談話。

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.

女士們，先生們，今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。