Skyworks Solutions, Inc. (SWKS) Q1 FY2026 Earnings Call Transcript & Summary

Good afternoon, and welcome to Skyworks Solutions First Quarter Fiscal Year 2026 Earnings Call. This call is being recorded. At this time, I will turn the call over to Raji Gill, Vice President of Investor Relations for Skyworks. Mr. Gill, please go ahead.

Thank you, operator. Good afternoon, everyone, and welcome to Skyworks' First Fiscal Quarter 2026 Conference Call. With me today for our prepared remarks is Phil Brace, our Chief Executive Officer and President; and Philip Carter, Senior Vice President and Chief Financial Officer for Skyworks. This call is being broadcast over the web and can be accessed from the Investor Relations section of the company's website at skyworksinc.com. In addition, the company's prepared remarks will be made available on our website promptly after the conclusion during the call. Before we begin, I would like to remind everyone that our discussion will include statements relating to future results and expectations that are or may be considered forward-looking statements. Please refer to our earnings press release and recent SEC filings, including our annual report on Form 10-K for information on certain risks that could cause actual outcomes to differ materially and adversely from any forward-looking statements made today. Additionally, today's discussion will include non-GAAP financial measures consistent with our past practice. Please refer to our press release within the Investor Relations section of our company website for a complete reconciliation to GAAP. With that, I'll turn the call over to Phil Brace.

Thanks, Raji, and welcome, everyone. Before turning to the quarter, I want to briefly address our previously announced combination with Qorvo. We believe this transaction is highly strategic and transformative, bringing greater scale, deeper R&D and a broader technology portfolio. Together, this combination is expected to reduce historical mobile volatility, strengthen our competitive position, enhance our broad market capabilities and expand our TAM in the defense and aerospace, while creating a clear path to more than $500 million of synergies over time. As highlighted in our investor presentation on October 28, we believe this combination will deliver substantial financial benefits. We expect to achieve healthy gross margin through the cycles in the 50% to 55% range, supported by significant operating leverage and enhanced earnings power. The combined company will generate robust free cash flow, underpinned by an extremely favorable capital structure with expected net leverage of approximately 1 at close. These advantages position us to drive long-term value for our shareholders and customers and support continued investment in innovation and growth. Since announcing the transaction on October 28, we've made solid progress. We've completed our initial regulatory filings, a shareholder vote has been scheduled, and our teams have begun integration planning. As is typical for a transaction of this scale, we expect a comprehensive regulatory review, and we are working closely with regulators around the world. We still expect the transaction to close in early calendar year 2027, subject to the receipt of required regulatory approvals, approval of both company shareholders and the satisfaction of other customary closing conditions. I'd also like to recognize the Qorvo team for the constructive and collaborative approach they brought to the integration planning process. We're off to a great start and excited about the opportunity ahead when we come together as one stronger organization. I want to emphasize that we are committed to closing the transaction and believe in the long-term value creation opportunity that the deal unlocks for our customers and shareholders. Beyond these prepared remarks, we will not be discussing the transaction as today's call will focus on our results from the first fiscal quarter as well as our outlook for the March quarter. Turning now to Skyworks' performance for this quarter. We stay focused on what we can control, operational execution, customer engagement and disciplined investment in our product road map. Our strategy remains straightforward: focus on our customers, invest in our core technologies and continue to grow broad markets. Broad markets remains a key growth engine for the company, growing faster than the corporate average. Our products are designed into high-growth areas across a wide range of end markets, including connected vehicles, enterprise infrastructure, satellite communications, data center networking and emerging edge AI applications. This breadth supports durability and reduces reliance on any single program. Skyworks delivered strong results, exceeding the high end of our guidance, driven by upside in both mobile and broad markets. We posted revenue of $1.04 billion, delivered earnings per share of $1.54, generated $339 million of free cash flow and paid $106 million in quarterly dividends. Revenue, gross margin and non-GAAP EPS all came in above the midpoint of our outlook. In mobile, we outperformed expectations, supported by healthy sell-through and strong execution on new product launches at our top customer. Smartphone replacement cycles, while still lengthy, are beginning to shorten. This trend is driving increased unit growth as consumers upgrade more frequently, especially with the rise of new AI-capable devices and more integrated features. While we are mindful of broader industry discussions around component pricing and availability, we have not seen an impact on demand to date. Reminder that the vast majority of our mobile revenue is tied to flagship and premium tier devices. Channel inventory remains lean, and we continue to closely monitor customer forecasts. As we look ahead to future business at our top customer, we successfully defended key mobile sockets and gained content where architecture changes created opportunities with mix dynamics potentially moderating some of that progress. Based on what we see today, we currently expect blended mobile content to be roughly flat year-over-year. We will not be commenting on specific sockets, models or launch timing. We remain bullish on the long-term drivers of RF content supported by accelerated replacement cycles, coupled with rising RF complexity tied to AI-driven workloads and higher performance requirements. Broad markets delivered its eighth consecutive quarter of growth with revenue up double digits year-on-year, reflecting strength across edge, IoT, data center and automotive. In edge IoT, WiFi 7 momentum continues to build, supported by bandwidth-intensive applications in the home and workplace. WiFi 7's higher throughput, lower latency and reliability position it as an important enabler as AI inference move closer to the edge. Design win activity remains strong, backlog is healthy, and we're already engaged with customers on early Wi-Fi 8 programs, positioning us well for the next cycle. Automotive demand remains solid, driven by increased connectivity across telematics, infotainment and software-defined vehicle architectures. Our pipeline is broad, global and aligned with long-cycle platforms across multiple OEMs and tiers, giving us good visibility into fiscal 2026. In data center infrastructure, demand signals are improving across our customer base, supported by increasing design win activity. Timing and power management content is expanding as the ecosystem transitions to next-generation 800-gig and emerging 1.6 terabit architectures. We are seeing higher activity, particularly with cloud and networking customers that require tightening timing accuracy, improved power performance and better synchronization across high-bandwidth systems. Broad markets continues to expand its reach across a more diversified set of customers while consistently delivering margins above the corporate average. The demand drivers across these end markets are long cycle and multiyear, positioning the business well as we move into fiscal '26 and beyond. With that, let me turn the call over to Philip for a discussion of last quarter's performance and outlook for Q2 of fiscal '26.

Thanks, Phil. Skyworks delivered revenue of $1.035 billion, exceeding the high end of our guidance range. During the quarter, our largest customer accounted for approximately 67% of revenue, consistent with the prior quarter. Mobile represented 62% of total revenue and came in higher than our expectations, driven by healthy sell-through at our top customer. Broad markets also outperformed expectations, growing 4% sequentially and 11% year-over-year, driven by growth across edge IoT, data center and cloud infrastructure and automotive. Gross profit was $482 million with gross margin of 46.6%. Operating expenses were $230 million at the low end of our guidance range, reflecting disciplined cost control while continuing to invest in priority growth areas. Operating income was $252 million, translating to an operating margin of 24.3%. Other income was $6 million, and our effective tax rate was 10%, resulting in net income of $232 million and diluted earnings per share of $1.54, $0.14 above the midpoint of our guidance. We generated $396 million of operating cash flow and capital expenditures of $57 million, resulting in free cash flow of $339 million or 33% free cash flow margin. We ended the quarter with approximately $1.6 billion in cash and investments and $1 billion in debt, maintaining a strong balance sheet and ample flexibility to support our strategic and financial priorities. Looking ahead to the second quarter of fiscal '26, we expect revenue to range between $875 million to $925 million. We anticipate mobile to decline approximately 20% sequentially, consistent with seasonality. We expect broad markets to be flat sequentially, representing 44% of sales and up high single digits year-over-year. Gross margin is projected to be approximately 44.5% to 45.5%, reflecting seasonally lower volume. We expect operating expenses to be between $230 million and $240 million as we continue to fund key R&D initiatives while maintaining tight control over discretionary spending. Below the line, we anticipate approximately $4 million in other income, an effective tax rate of 10% and diluted share count of 151 million shares. At the midpoint of our revenue outlook of $900 million, this equates to expected diluted earnings per share of $1.04. With that, I'll turn it back over to Phil for closing remarks.

Thank you, Philip. Before we wrap up, a heartfelt thank you to our employees, customers and partners. Your dedication fuels our success and sets the stage for continued leadership and growth. Operator, let's open the line for questions.

[Operator Instructions]. Our first question comes from Harsh Kumar with Piper Sandler.

First of all, congratulations, guys. We know this is a tough environment, but you guys are doing really well in mobile specifically. Phil, I had a question for you. You mentioned 2 things. You said you won't take specific questions on the deal, but you mentioned you will see increased scale, deeper R&D capability, broader technology suite, et cetera. I was wondering if you could hit upon what maybe specifically or color-wise, what you expect to see out of this deal on these kind of fronts?

Yes. What I'm really excited about, thanks for the question. Look, what's always impressed me is the nature -- complementary nature of our portfolios. In fact, it's pretty clear. I mean, Qorvo has a lot of the antenna side of the house, which we don't really have at all. So I'm really excited about bringing those complementary technologies together, particularly on the RF side, it should result in reduced volatility. It should increase our scale on the RF side, giving us the opportunity to innovate across the RF chain, brings us lots of engineers that we think are highly valuable. And I just think there's just -- the future is super bright in how we do that. And then we bring the combination together, brings a fantastic broad market syn as well. So super bullish about that, and I hope that answered your question.

No, it does. And then as my follow-up, if I can ask you, you will have a pretty broad set of RF products to address your largest customer need. I think that's the biggest customer around that you want to be playing with and you have kind of a pretty broad portfolio. So the question was, how do you see the combined company having the right kind of RF portfolio? What will you be focused on within that portfolio to address your customers' needs?

Yes. Look, I think that we bring a tremendous scale all the way from a lot of the antenna areas all the way back to the pads and a number of different critical RF technologies. And when we see the RF complexity evolving as AI workloads look more to the edge. There's more transmit capability and things coming down the pipe. From what we can see, having the broadest RF portfolio in the industry is going to be a really powerful opportunity for us. And then also, I think, keep in mind, it gives us an opportunity to innovate in a variety of other areas, too. We talked about WiFi or some of the other areas as well. The world is connected wirelessly. There are billions of devices connected wirelessly. And I think it continues to give us a platform to invest in that for the future going forward.

Our next question comes from Karl Ackerman with BNP Paribas.

Two, if I may. Your guide implies broad markets will grow on a year-over-year basis for, I think, at least 6 consecutive quarters, I think you said even 8 on a sequential basis. Could you discuss -- you spoke a little bit about some of the design wins, particularly around WiFi driving demand for edge. But could you also address where you're seeing the most strength of broad markets in the March quarter? And then which areas of this business do you see that you have the most confidence in that can drive growth -- your long-term growth over the next 2 or 3 years? And I have a follow-up, please.

Yes. Thanks. I mean, look, this marks our eighth consecutive quarter of sequential growth with double-digit year-over-year revenue expansion. So we feel really good about that. When I look at kind of underneath the covers, what you asked for, I would, I guess I would point to 3 major areas, right? The first would be WiFi, right? WiFi 7 adoption continues to be very strong. And there are some reasons for that, right? The increased bandwidth, the increased security is really -- as AI moves -- continues to move out there to the edge, we see WiFi continuing to be a major platform for that. And demand there remains robust. And certainly, we see a long push of innovation that leads out to WiFi 8 and beyond. So I'm particularly excited about that one. On the automotive stuff, for us, that's also been an area that we've seen good growth. And there's a lot of headlines in the news about auto markets, but we actually tend to be kind of in the sweet spot of the growth area because we're talking about vehicle-to-vehicle connectivity. We're talking about infotainment and power isolation products, which are really kind of independent of what kind of combustion engine you use. And we've seen pretty broad-based wins across the board globally on that. So that seems to be some tailwind for us. And then finally, on the power and timing, which is really related to the data center side, I mean, we're seeing tremendous uptick in our activity, design wins, particularly as we have a really strong lead in what we call jitter attenuating clocks, which are really important as the frequencies continue to go up to 800 gig or 1.6 terabytes. And then some of our power isolation products, which really have to do with as the servers move to higher and higher voltage, you need to isolate the power that's coming in from the low-voltage power of the actual silicon devices. So I mean, I would characterize WiFi, automotive and then data center with power and timing as kind of being 3 structural tailwind things we have in our broad markets. We're excited about.

Got it. During the prepared comments, you spoke about how you're seeing strengthening position, your 5G position in premium Android handsets, including the upcoming Galaxy S26 launch. At the same time, you spoke about how your overall content should at least be stable, if not maybe a little bit better than that going forward. Having said that as sort of a backdrop, I guess, should we expect that fiscal '25 should be the trough in content at your largest customer? And I guess more broadly, could you describe your positioning at your largest customer and whether Agentic AI could drive higher RF content gains in edge devices than in prior solar technology upgrade cycles as well?

Yes. Good question. Look, I think what I would say, look, we compete for business every single year at our large customer. I don't expect that to change. I'm pleased we defended our major sockets at all the mobile platforms. So I'm pleased we did that. I'm not satisfied that we did because I think we have the opportunity to do even better than that. But I'm pleased we defended the sockets. And I think some of our prepared remarks and from our largest customers suggest there's a strong tailwind with both upgrade cycles, AI demand pushing things to the edge. And we continue to see very strong demand signals, not just on the mobile side, but pretty much broad-based right now as well. We're keeping a close eye on it, just given some of the commentary around component prices and things. But right now, we continue to see a very strong tailwind of unit demand.

Our next question comes from Edward Snyder with Charter Equity Research.

Ed, we're having some difficulty hearing you.

Sorry. Is that any better?

Yes.

Sorry, guys. Yes. So I'm a little confused. You mentioned that you defended your sockets. You've got some good content gains, but you think they may offset by mix. And given what we know about basically the mix here, I would have thought you'd have a little bit more of a tailwind in the second half of this year just from the sheer fact that you've gained back some content and the mix of modems at least is favoring you over what you did last year. I thought last year would be your trough. But -- I know since CES, there's been a lot of discussion about the worst is yet to come, et cetera. So maybe you could help clarify that. Why do you think mix is going to offset your content gains?

I think, Ed, thanks for the question. I think that we got to be careful. It's difficult for us to really comment on specific models and launch timings and things like that. But I think that suffice to say, some of the content varies between particular models. And it's really hard for us to predict what ones they're going to sell, when they're going to launch and how they're going to do. So I think our best guess right now is our blended content should be flat. We defended our key sockets. We gained back some more architecture changes, and we think net overall could be flat. We do expect some tailwind with respect to some of the demand we're seeing, right? I mean it's very strong demand across the board. I'm happy that we did that. I'm not satisfied that we did, but I'm happy we did that, and we've got some more opportunities ahead. So hopefully, that -- we try our best to kind of answer that. That's kind of why we're projecting blended flat at this point.

Okay. And then if I could just ask, you have a so in Japan. I know you're under utilized in a couple of your factories, specifically with the filter factory in Osaka. Is that going to improve in the second half of the year substantially? Or should we expect kind of status quo maybe a little bit better?

Yes. Look, I think right now, it really depends on the technology base. We're not going to talk about specific loading of specific factories. I would say that in general, and the products that are being utilized, we are definitely -- we are at capacity, right? We are definitely hand to mouth from that. We're scrambling to meet REIT demands. And right now, our demand exceeds our supply. And so we're continuing to work that. There are pockets of areas where we talked about, for example, a specific facility, and that really has to do with more technology changes than anything like that. So I think that our gross margin guide, if you're kind of going there, that really reflects what we have best knowledge today of balancing mix right, costs, prices and things where we want to go, right? It's something we keep a close eye on, and we're going to continue to work that going forward.

Our next question comes from Timothy Arcuri with UBS.

I think you have about $1.2 billion left on your repo authorization. The stock has obviously come in. I think you sound super confident on these synergies and the deal closure being on track. So can you buy back stock? I think you can repo stock with Qorvo management approval. Is that right? Can you kind of talk about that?

Tim, yes, this is Phil Carter here. Yes. So our free cash flow this quarter was $339 million, 33% margin. We're sitting with $1.6 billion in cash, $1 billion in debt. So we do have ample opportunity in cash to buy the stock. During the pendency period, there are some requirements, but we're constantly looking on how we can deploy our cash. We did announce in the press release that we are paying a $0.71 dividend to our shareholders. But we are constantly looking at the optionality. We do have to go to the debt markets in the next 12 months or so in anticipation of closing this deal. So we do want to maintain some level of financial prudence as well.

Okay. And then there was a huge amount of focus on the earnings call for your biggest customer around memory pricing and headwinds for their margins. So it seems like maybe it's a risk that they push back on you on pricing. So can you talk about that as a risk? You said content is flat, but is your pricing locked in with them? Because I would think that they are going to try to take everything out of all their suppliers that they can given these memory cost headwinds.

Yes. No, I think that -- I mean, first off, when we talk about some of those wild swings in what we've heard about in the market, there's simply no way for any company like Skyworks to be able to dampen that volatility out there. So the short answer is no. There's always competitive pricing dynamics at our largest customer. Having said that, as I mentioned, we are hand to mouth. We are scrambling for every part we can build at this point. And so we're not seeing any pressure associated with that. And I wouldn't really expect to either. Now could that change going forward? Maybe, but we're not seeing it right now.

Our next question comes from Peter Peng with JPMorgan.

Just in terms of your -- the overall unit assumptions that we should be thinking, I think you talked about a pretty strong upgrade cycle going. At the same time, I think there's a lot of concerns about memory, and you guys historically have talked about low single-digit unit growth. Is that still the base case to assume for this year or because of some of the memory constraints that this could be more of a flat market? Maybe just you can share some color on what you're seeing.

Well, look, I think that we're only really guiding one quarter out. But I would say, I think consistent with what has been said publicly on prior calls, I mean, we are seeing very strong unit demand. And we're certainly seeing that. So that's reflected in our numbers, certainly above seasonality, and we're seeing very strong demand. So I'll leave it at that. I don't think we want to project demand going forward because we really don't know. We just take the input from the customers and go look at it there. So -- but we do expect to see stronger unit demand than perhaps you've seen publicly talked about before.

Got it. That's very helpful. And then just in terms of seasonality just given the potential different set of launches and you guys have historically had a bigger in uncertainties. How do we think about seasonalities through like in the year? Is it -- should we kind of just model based on historical seasonality or because of some of the different launch timing that we might just skew the seasonality a little bit?

Yes. Obviously, we can't really talk about launch timing of our customers and what they do. I know there's been a lot of industry chatter on that, and that's not really something we are prepared to talk about, nor frankly do we really know, to be honest. It's not something they don't review their -- none of our customers review their particular plans with us. But I would say that as we look in the out quarters, I mean, I don't -- I think we're kind of what I would characterize as fairly normal. We're not seeing anything abnormal with respect to that. So I would just -- nothing abnormal, just strong demand, and I wouldn't say there's anything -- we're not seeing anything unusual with respect to that.

Our next question comes from Jim Schneider with Goldman Sachs.

Following on the prior comment, realizing you can't comment on your customers' product launch plans. But in principle, what impact would a seasonally more muted business cycle or product launch cycle have on the company operational, either in terms of production, factory loadings, overall gross margins or otherwise?

Well, [indiscernible] , let me -- and look, overall, I think -- obviously, being our large customer, right, any sort of swings in demand are impactful for us in terms of how we manage that. Right now, we are very constrained across the board. We're fighting hand to mouth for products, and we continue to do that. I think we've been an effective. We've done an effective job operationally managing that. I mean having some peaks and valleys with respect to demand is not unusual for that customer as they ramp up and down through the cycles. And so right now, I think that we tend to be in a situation where the demand is just very strong. And we've seen these situations before. We're doing our best to manage them. And should signals change, then we'll deal with that accordingly. I mean I'm not sure I can give you a better answer than that.

That's fair enough. And then maybe just as a quick follow-up. You talked about the sort of recovery in broad markets, which I think is kind of consistent with what your peers have reported. Can you maybe talk about any sort of idiosyncratic product areas that you think are going to drive sort of outsized market growth relative to the market for you this year?

Yes. I think I kind of mentioned them before. I mean some of the areas that I'm excited about, I mean, we talked about Wi-Fi being a big driver there. We talked about being in the auto segment growing faster. The data center spice with power and our timing products continues to be a good one. Longer term, this is not yet big enough to talk about, but I'm excited about what we're doing in satellite comms, too. I mean I just think we've got exposure in a number of areas. I mean I just -- I try and remind everybody I talked to you, the world is connected wirelessly. We're in a very good spot for that. And some of our products that play in the data center, including timing and power, we are also seeing a bit of tailwind. So I think we've got a lot of great stuff going on and our broad markets continues to grow and continues to perform at a better corporate average. I think that will help us continue to get outsized earnings out in the future.

Our next question comes from Gary Mobley with Loop Capital.

I had just one question. In early December, you filed a Form S-4 in which you gave a revenue forecast specific to Skyworks business out through 2030. And I believe that predates your down selection with your largest customer in the next-generation launch. So given what you know today on sort of your content in the upcoming launch, do you still stand behind those revenue forecast outlined in the S-4 filing for 2026 and 2027?

Yes. Thanks for the question. It's obviously difficult for me to -- for a lot of reasons, can't specifically comment on specific filings with me back then. I just would say that I continue to be incredibly bullish about that combination going forward. I continue to believe in the strategic and financial benefits of that. We are committed to closing the transaction. And frankly, I can't wait to get it closed.

Our next question comes from Christopher Rolland with Susquehanna.

This is Yash Shah on for Christopher Rolland. And I had a question on gross margins. So maybe just looking forward a couple of quarters, are there any gross margin puts and takes we should consider just given the memory dynamics that was expressed by our largest customer? Any trends in mix, pricing? Any additional color there would be helpful.

Yes. So this is Carter. We don't give any guidance beyond 1 quarter. As we look to the next quarter guidance, we did guide margin down 160 basis points, and that's mostly due to typical seasonality in mobile and lower volume in the March quarter as well as slightly higher mix of Android. We also have had 3 quarters in a row of exceeding the high end of our guidance range. And as a result, you can imagine you're getting a little bit more input costs on expedite fees and things like that to meet our on-time delivery targets with our customers. But yes, other than that, I would say we're not seeing anything abnormal from typical seasonality.

And then for Android, I believe last call, you provided color, it was a little less than $100 million. So any update to that revenue? And how should we think about seasonality here through the year?

I would say for the current quarter, as we look at Android, it's down quarter-to-quarter. We are anticipating an increase from the current quarter Q1 into Q2. And so yes, as we look at that, it will be actually double-digit growth from Q1 to Q2. But we do anticipate that to moderate as we go throughout the year. So we're not seeing huge Android growth throughout the year as we're very selective on the devices that we choose to play in.

And our last question comes from Liam Pharr of BofA.

I just wanted to have a quick clarification. When you said that your content gains at your largest customer offset by mix, do you mean that, that offset is from the 17 becoming a greater part of the overall mix or by expected shifts between models of the same generation?

It's really -- I said it could be potentially moderated by mix because we don't really know, right? I mean the issue is that we don't really know, and I don't even think the customer knows how the particular models are going to sell, and that won't be clear for some time. And so I think that we're trying to give guidance one quarter at a time. We defended our key sockets. We made progress where we could. We're just making the best prediction of what we think we can, and we'll give guidance along the way as we go there. We think our content should be stable on a blended basis. And how it actually gets quarter-to-quarter is really going to depend on how the models do, and we'll just continue to keep an eye on that as we go forward.

Makes sense. And then shifting to broad markets. I was wondering if you could touch on just in terms of data center progress. Is it still any -- is it growing faster or slower than the overall segment average? And in WiFi, maybe I don't want to talk too much about the deal, but in terms of how complementary those portfolios are and whether there's any opportunity for competition naturally between your 2 portfolios as you combine them?

Yes. On the data center side, one of the -- yes, the short answer is yes, that is growing faster than our overall broad markets. And let me give you an example of some of the power isolation products we have to put it in context. The power isolation products, what they do is they provide -- they basically isolate the very high voltage from the actual lower voltage microcontrollers and GPUs and things. And so as you -- all the trends with respect to having higher and higher voltage on the data center side, you need to have very specialty products that basically isolate those powers because you can imagine if you put 4 800-volt DC onto a GPU, it's probably not going to last very long. And so all of those products, so we're getting lots of demand in that space. And then the timing products really around 1 point -- about 800 gig and 1.6 terabit with their low jitter attenuating clocks are doing really well as well. So right now, right, those are growing definitely faster than the corporate average. The margins are better than the corporate average. We just wish there'll be a lot bigger. And so we're continuing to work that and invest in those. Those are continue to be core investment areas for us. With respect to WiFi, you asked about the combination, right? I think that both of the products have their unique positions to do that. We'll evaluate that going forward in terms of what we want to do. What we've told the customers is we're continuing to keep our commitments to them going forward in time, and we're going to make the best decisions on how we do that going forward.

Ladies and gentlemen, that concludes today's question-and-answer session. I'll now turn the call back over to Mr. Brace for any closing comments.

Great. Thank you very much for joining the call today, and I look forward to seeing you in person at some of the upcoming conferences. Thanks again.

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