MONOLITHIC POWER SYSTEMS INC Q3 FY2024 earnings call

• MPS achieved record quarterly revenue of $620.1 million, 22% higher than Q2 2024 and 30% higher than Q3 2023.
• Performance reflected strength of diversified market strategy with improved ordering trends across most end markets and initial revenue ramps from design wins.
• Automotive revenue up 28% sequentially with improvements in infotainment, lighting, ADAS, and body controls.
• Communication revenue up 65% from prior quarter due to new product ramps for Wi-Fi, optical, networking, and router solutions.
• Storage and Compute revenue up 25% sequentially on demand for DDR5 and SSD memory and notebooks.
• Focus on innovation, quality, and expanding/diversifying global supply chain.
• Transformation from chip-only supplier to full-service silicon-based solutions provider.

MPS achieved record quarterly revenue of $620.1 million. Automotive revenue was up 28% sequentially, contributing significantly to the overall growth. Communication revenue was up 65% from the prior quarter. Storage and Compute revenue was up 25% sequentially. Enterprise data was down about 1.5% sequentially.

• Enterprise data was expected to be in the low-single-digits sequentially.
• Design wins secured in prior years are starting to ramp up into revenue.
• Continued growth expected as new product ramps and diversified segments contribute.

• Supply chain security concerns as customers may seek second or third competitors.
• Potential pricing pressure from competitors, especially Chinese suppliers trying to lower prices.
• Uncertainties in end-market ordering patterns affecting segment performance.

Q: Rick Schafer asked about enterprise data being down sequentially and auto segments' turnaround.

A: Bernie and Michael discussed enterprise data being due to ordering patterns and supply chain security, and auto segments showing broad-based pickup from design wins.

Q: Tore Svanberg asked about enterprise data's performance in Q4 and communications growth.

A: Michael said Q4 enterprise data would fulfill forecast, and Tony Balow discussed sustainable growth in communications through H1 2025.

Q: Joshua Buchalter asked about impact of order patterns vs second sourcing on enterprise data and AI platforms.

A: Bernie and Michael talked about no share position change in Q4 and ramping of tensor processors (TPUs).

Q: Chris Caso asked about Q4 guidance and enterprise data's traditional server part.

A: Bernie said little change in Q4 guidance, and Michael and Tony discussed volumes picking up in traditional server.

Q: William Stein asked about home automation and data converters.

A: Michael talked about MPS's presence in home automation with MCUs and growth in data converters with long design cycles.

Q: Ross Seymore asked about non-enterprise data growth vs peers and pricing pressure.

A: Bernie and Michael discussed both cyclical improvements and Monolithic power-specific dynamics, and Michael talked about competition not affecting MPS due to focus on value and diversity.

Q: Quinn Bolton asked about 10% plus customers and enterprise data growth.

A: Bernie and Michael discussed one or two customers above 10% and confident growth in enterprise data with ASIC designs ramping.

Q: Tore Svanberg asked about vertical power and market acceleration.

A: Michael said vertical power products are shipping in good volumes and will accelerate.

Q: Ross Seymore asked about inventory.

A: Bernie said total channel inventory days fell, and Michael talked about low channel inventory and uncomfortable levels.