Silicon Laboratories Q2 2025 Earnings Call Transcript

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Provided by Quartr
August 5, 2025

Key Takeaways

  • Positive Sentiment: Silicon Labs reported Q2 revenue of $193 million, up 9% sequentially and 33% year-over-year, with non-GAAP gross margin improving 90 basis points to 56.3% and non-GAAP EPS of $0.11 beating guidance by $0.02.
  • Positive Sentiment: The Series 2 platform drove design win momentum, with 10 of the 12 largest customer ramps on track for 2025 and Series 3 device SLP301 now in volume production as the first IoT chip to achieve PSA Level 4 certification.
  • Positive Sentiment: Home & Life revenue rose double digits year-over-year fueled by smart home applications and connected healthcare ramps, while Industrial & Commercial also grew double digits led by electronic shelf labels, smart metering rollouts and new logistics asset-tracking wins.
  • Positive Sentiment: For Q3, management guides $200–$210 million in revenue (23% YoY, 6% sequential growth), with gross margins expanding to 57–58% and expects to outpace the broader semiconductor market.
  • Negative Sentiment: Evolving tariff discussions and sub-target distribution channel inventory at 51 days (vs. 70–75-day goal) limit visibility and require gradual channel refilling over coming quarters.
AI Generated. May Contain Errors.
Earnings Conference Call
Silicon Laboratories Q2 2025
00:00 / 00:00

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Operator

Hello. My name is Didi, and I will be your conference operator today. Welcome to the Silicon Labs Second Quarter Fiscal twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session.

Operator

To ask a question during the session, you will need to press 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press 11 again. Please be advised that today's conference is being recorded. I will now turn the call over to Giovanni Pacelli, Silicon Labs' Senior Director of Finance. Giovanni, please go ahead.

Giovanni Pacelli
Giovanni Pacelli
Senior Director of Finance at Silicon Laboratories

Thank you, Didi, and good morning, everyone. We are recording this meeting, and a replay will be available for four weeks on the Investor Relations section of our website at investor.scilabs.com. Our earnings press release and the accompanying financial tables are also available on our website. Joining me today are Silicon Labs' President and Chief Executive Officer, Matt Johnson and Chief Financial Officer, Dean Butler. They will discuss our second quarter financial performance and review recent business activities.

Giovanni Pacelli
Giovanni Pacelli
Senior Director of Finance at Silicon Laboratories

We will take questions after our prepared comments and our remarks today will include forward looking statements that are subject to risks and uncertainties. We base these forward looking statements on information available to us as of the date of this conference call and assume no obligation to update these statements in the future. We encourage you to review our SEC filings, which identify important risk factors that could cause actual results to differ materially from those contained in any forward looking statements. Additionally, during our call today, we will refer to certain non GAAP financial information. A reconciliation of our GAAP to non GAAP results is included in the company's earnings press release on the Investor Relations section of the Silicon Labs website.

Giovanni Pacelli
Giovanni Pacelli
Senior Director of Finance at Silicon Laboratories

I'd now like to turn the call over to Silicon Labs' Chief Executive Officer, Matt Johnson. Matt?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Thanks Giovanni and good morning everyone. Silicon Labs delivered second quarter results in line with our outlook, driving strong sequential and year over year growth in both sales and profitability while closely managing operating expenses. We remain laser focused on converting our design win pipeline into production ramps and this quarter's results demonstrate our consistent progress. Our current forecast indicates that 10 of our 12 largest customer ramps are on track or ahead of plan for 2025. As we shared in our March Investor Day, our industry leading Series two platform continues to drive rapid revenue growth and share gains across both of our business areas, including significant growth in Bluetooth and Wi Fi products.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Looking at Q2, our home and life business was up double digits year over year, driven by continued stabilization in smart home applications, as well as shipments to connected healthcare customers as many of these designs began production in early twenty twenty five. In the smart home, we saw strength in home automation applications like gateways and smart lighting. Additionally, our newest Wi Fi device, the nine seventeen is providing battery powered Wi Fi connectivity for the Roku battery camera that is now available on Walmart shelves, as well as Roku battery camera plus. Both models are available at Amazon and online at other major retailers. Silicon Labs enables a high fidelity 1080p camera to operate on battery power for up to two years before needing to be replaced.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

An incredible breakthrough. Meanwhile, our healthcare initiatives are progressing well as we continue to ramp new customers. Overall, we remain confident in the strong growth potential of this market, including in continuous glucose monitoring applications, which we continue to expect will become 10% of our revenue. Our industrial commercial business was also up double digits year over year. Sequentially, the growth was underpinned by strength in the electronic shelf labeling market and an ongoing recovery of broad based industrial applications that are typically served through our distribution channel.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

We're also seeing steady shipments to global smart metering customers, including India's electric metering rollout and expect to begin shipments for Japan's metering refresh cycle later this year. Looking beyond Q2 results, our Series two platform continues to drive the growth of our design win pipeline and positions us extremely well for continued market share expansion. This includes new design wins and applications like commercial building controls, where utility companies are encouraging more efficient power consumption, utilizing our best in class multi protocol solutions and domain expertise. Along with further traction in ecosystems like Matter and Amazon Sidewalk. We're also working towards establishing new partnerships in connected healthcare and are confident that our market share momentum in applications like diabetes management will continue.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

In addition, we have secured design wins in other emerging medical applications like remote vital sign monitors and medicine delivery applications as our products emerge as best in class for many of these market needs. Finally, in our commercial business, we've seen strong engagement for logistics applications like real time asset tracking. In fact, we recently won a new high volume design win with one of the world's largest pallet makers, highlighting increasing customer interest and proximity based tracking of higher value assets moving through their supply chains. Building on our track record of being first introduced new to industry innovative features and capabilities on our Series two platform, we are excited to announce that our first Series three device, the three zero one, is shipping in volume production and now claims the title as the world's first device to achieve PSA level four secondurity certification. This milestone reinforces our long track record of industry first achievements and sets a new benchmark for trusted embedded computing.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Additionally, another Series three device, the three zero two, will be sampling next year and will bring industry leading energy efficiency and wireless performance to battery powered devices that support both Bluetooth and matter applications, setting another industry performance benchmark. Moving forward, our market share momentum driven by our Series two platform and the introduction of our next gen Series three platform positions us incredibly well to sustain outsized growth in our accelerating markets. Looking near term, while the evolving tariff discussions somewhat limit our visibility, we have not observed significant changes to our customers' forecasts. Additionally, our customer surveys do not indicate end customer inventory bills and in many cases reveal lower inventory positions compared to ninety days ago. Our outlook for sequential growth into the third quarter continues to be supported by share gains and secular growth markets, execution of new program ramps and consistent improvements in our order patterns.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

This combination gives us confidence that we're on track to outperform the broader semiconductor market this year. Now, I'll hand it over to Dean for the financial update. Dean?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Thanks, Matt, and good morning to everyone. I will first review the financial results for our recently completed quarter, followed by a discussion of our current outlook. Revenue for the June was $193,000,000 up 9% sequentially and in line with the midpoint of our prior guidance.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Year over year, consolidated revenue was up 33%. In our industrial and commercial business, June revenue was $110,000,000 up 14% sequentially and up 25% from the same period last year. Sequentially, the growth was driven by customer ramps in electronic shelf label deployments, continued smart meter rollouts, and a steady demand improvement for a wide range of industrial applications. Home and Life June revenue was 83,000,000 up 2% sequentially and up 45% from the same period a year ago, driven by new design ramps with medical customers more than doubling versus the same quarter one year ago. During the quarter, distribution made up approximately 69% of our revenue mix.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Sell through at distribution partners continued to grow. And channel inventory increased slightly to end at fifty one days, up from forty eight days in the prior quarter, despite our intention to begin moving toward our target range of seventy to seventy five days. June gross margins saw positive improvements as the long tail channel sales and industrial applications continue to benefit our mix. GAAP gross margin was 56.1. Non GAAP gross margin was 56.3%, which was up 90 basis points from the prior quarter and above the midpoint of our guidance.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

GAAP operating expenses were $131,000,000 which includes share based compensation of $20,000,000 and intangible asset amortization of 3,000,000 Non GAAP operating expenses of $107,000,000 was consistent with our prior guidance. GAAP operating loss of $23,000,000 and non GAAP operating income was 1,000,000 During the quarter, we recorded a GAAP tax charge of approximately $3,000,000 Our non GAAP tax rate remained 20%. GAAP loss per share was $0.67 and non GAAP earnings of $0.11 per share beat the midpoint of our guidance by $02 Turning to the balance sheet. We ended the quarter with $416,000,000 of cash, cash equivalents and short term investments. Our days of sales outstanding was approximately thirty days.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

During the quarter, our balance sheet inventory remained essentially flat, ending the quarter at $81,000,000 of net inventory. Days of inventory on hand improved to 86, a sequential improvement from ninety four days at March. As it stands today, we have not seen a direct impact to our supply chain from the shifting tariff rules. While the outcome of ongoing tariff discussions and their potential indirect impact on global demand are still uncertain, conversations with our customers do not currently point to any meaningful pull forward in demand. Order patterns from customer bookings and distribution POS continue to show positive improvement, extending a multi quarter trend of positive progressions.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

This supports our view from last quarter that our end markets are making headway in their cyclical recovery. Additionally, our survey showed that our end customers' inventory ticked down in the quarter, and in many cases revealed relatively low inventory positions. Now for our current outlook. We anticipate revenue in the September to be in the range of $200,000,000 to $210,000,000 which at the midpoint would imply a strong 23% year over year growth rate and a 6% sequential growth. Importantly, we believe Silicon Labs is tracking to outperform the broader semiconductor market this year based on the execution of our new customer design ramps and further supported by improving cyclical demand.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

With continued strength in industrial applications and sales through our distribution channel growing, we expect continued gross margin improvements in the September, with both GAAP and non GAAP gross margin expected to be in the range of 57% to 58%. We continue to manage operating expenses tightly and remain committed to our published financial model of growing expenses one third the rate of revenue growth, allowing for rapid earnings acceleration moving forward. In line with that philosophy, we expect GAAP operating expenses in the September to be in the range of $130,000,000 to $133,000,000 We expect non GAAP operating expenses to modestly increase in the September to be in the range of $107,000,000 to 110,000,000 as the employee bonus pool is expected to accrue at a higher contribution given our return to profitability. Finally, GAAP loss per share is expected to be in range of 60¢ loss to a $0.20 loss on a basic share count of 32,800,000 shares. Non GAAP earnings per share is expected to be in the range of $0.20 to $0.40 on an expected diluted share count of 33,000,000 shares.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

This wraps up our prepared remarks. I'd like to now hand the call over to the operator to start the Q and A session. Katie?

Operator

Thank you. As a reminder, to ask a question, please press 11 on your telephone and wait for your name to be announced. To withdraw your question, please press 11 again. In the interest of time, we ask that you limit your questions to one question and one follow-up. Please stand by while we can poll the Q and A roster.

Operator

And our first question comes from Quinn Bolton of Needham and Company. Your line is open.

Quinn Bolton
MD - Equity Research at Needham & Company

Hey guys, congratulations on the continued strong outlook. I wanted to ask a question just on the Home and Life business. I know it's up strongly year on year, but it was sort of up 2% quarter on quarter, perhaps a little bit below my estimates. How are you thinking about that business as you get into the second half of the year? I think you reiterated that target for continuous glucose monitors, they hit 10% of sales.

Quinn Bolton
MD - Equity Research at Needham & Company

Is that still on track for the second by the 2025?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Yes, sure. Quinn, this is Matt. Quick answer is, let's see, big picture, CGM is still on track, still committed to that 10% number on the timeline we've mentioned. I think what's going on big picture here is, as we've said for many quarters, the primary driver of our growth are these share gains in these major ramps. And those ramps can be lumpy, they can be some are ahead of schedule, some are behind, some are bigger, some are lower, but as we shared in the prepared remarks, we're tracking a tremendous amount of ramps and of those, our top twelve, ten of those are on track.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

So in aggregate, we're able to stay on track or better to our expectations. And you know, the easiest way to look at it is, our expectations by segment, by application, and by customer haven't changed. So we feel good about the outlook and no major changes.

Quinn Bolton
MD - Equity Research at Needham & Company

Perfect. And then I guess one for Dean. Dean, you've done a great job here on gross margin getting back to sort of I think your longer term target of 57% to 58%. Do you expect it to kind of hang out in this level going forward? Or do you see room for potential further improvement above that 57% to 58% level in future quarters?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Yeah, this is an area I think the team's done super well on, Quinn. Just to reiterate what our long term financial model, it's 56% to 58%, so midpoint sort of 57%. Where we are now, we're trending toward the high end of that range. We just got at 57 to 58, so in that higher end of that portion. My expectation is that we continue to drive into this higher end of it as distribution channel continues to contribute in a meaningful way, as a lot of our industrial type customers are doing quite well in the marketplace.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

That's going to keep us in the high end of that zone. I do think over time it will probably bounce between this fifty six and fifty eight. I am not at a point where we're going to reassess the long term model and say, hey, we can go higher from that 58 mark. But at least from what we can see on the near term over probably the next couple of quarters, given how distribution is trending, we look like we're going to stay in that high end.

Quinn Bolton
MD - Equity Research at Needham & Company

Perfect. Thank you, Deep.

Operator

Thank you. And our next question comes from Tore Svanberg of Stifel. Your line is open.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

Yes. Let me echo my congratulations, especially on the operating leverage here. My first question, Matt, is on your design win pipeline. The growth is clearly driven by your execution towards that pipeline. Could you perhaps give us any update as far as numbers?

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

Is it growing? Yes, just want a little bit more color on the actual pipeline. Thank you.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Yes, sure. Thanks, Tore. Big picture, we've shared that we've had a tremendous success over the last few years from a design win perspective and we've really tried to pivot to making sure we ramp all those designs that we've secured and that's exactly what we're starting to see here. We've been consistent and the primary driver of our growth this year are those share gains and ramps that are happening. But to answer your question directly, we still like what we see and we still have that momentum.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

The opportunity funnel is the largest it's ever been. We are on track for design wins, are larger than they've been, and we have great momentum. The easiest way to think about it, Series two is still gaining market share and winning. Wi Fi is allowing us to increment up and start growing even faster. And now we're putting Series three in the mix with new to world capabilities and features.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

So no expectation that that'll slow down. So, we like where we're at and we like what we're seeing.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

Very good. And as my follow-up, had a question on the glucose meter business. I know you mentioned multiple customers now. Again, could you perhaps give us some color on how many customers are ramping there? Because clearly, you're gaining share.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

And I think last time you had a call, think you talked about already working with, 10 or a dozen customers, in glucose meters.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Yeah. Specific numbers. I hope I don't screw this up guys from Analyst Day, but, I think what we shared with that is we are engaged with over 60 customers in the space and we are ramping more than 12 in the space. So that's where we're at and as we shared in the prepared remarks, we're continuing to make progress on that in that particular space and even expanding out into additional applications within the medical and healthcare space, where we're just finding our products are really dialed in. Liking what we see there, Tory.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

Great. Thank you. We'll go back in line.

Operator

Thank you. And our next question comes from Tom O'Malley of Barclays. Your line is open.

Thomas O'Malley
Thomas O'Malley
Director - Equity Research at Barclays

Hey guys, thanks for taking my question. I've kind of the inverse question to Quinn and to June. You saw some really strong trends in the industrial and consumer business. You've seen during this earnings period other large players kind of talk about some pull forward in industrial. I was curious, was there any geographic changes in the mix of revenue in the June?

Thomas O'Malley
Thomas O'Malley
Director - Equity Research at Barclays

I think you called out self labeling, the distichannel and then India smart metering, but anything to note in terms of geo differences in that June?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Yeah, Tom, this is Matt. Quick answer is no. Pretty consistent across the board. In fact, it's worth pointing out, we're seeing that broadly that we acknowledge all the uncertainty that's out there around tariffs and we're watching closely for signs of build aheads, pull ins and there has to be something going on out there around that, but the data is encouraging. We see bookings consistent with what forecast was, no major anomalies there, customers are in line with expectation, consistent improvements, but linear, and inventories in line, right?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Our internal inventory looks good, Just the inventory, if anything's low, as we're trying to build that up and end customer inventory, on average is actually down over the last ninety days. So the data, you know, the uncertainty that's out there, the data is encouraging and going in the right direction.

Thomas O'Malley
Thomas O'Malley
Director - Equity Research at Barclays

Helpful. And then when I look at the gross margins, are very impressive going into September, it looks like the incremental gross margin is close to 80% quarter over quarter. That's the highest you've done in the last couple of years. So if you look at the divergence in revenue trends in the September, do you continue to see more disty and by that measure more industrial and commercial into the September? But maybe give us a little color on segment trends into September and then why you're seeing such a big step up on the gross margin side? Thank you.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Yeah, Tom. I think you got it right on sort of segment and business mix. As you know, a lot of the industrial tends to go through the channel, and the channel customers generally are long tail, lower unit count, and therefore, generally higher ASP. So we do get a a better margin step up as more and more things, you know, close the channel. A lot of that is industrial based.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

There are other, like, small benefits that you get through as revenue increases. Right? You get some efficiencies on some of the fixed costs that you run your supply chain. But the majority here is really the dynamic around industrial customers, you know, going through channel.

Operator

Thank you. And our next question comes from Christopher Ron of Susquehanna. Your line is open.

Christopher Rolland
Christopher Rolland
Senior Equity Analyst - Semiconducters at SIG Group

Hey, guys. Thanks for the question. Yeah, just regarding distribution in the channel, are there opportunities to refill the channel, to grow the channel here? And, like, as we look over the next few quarters, maybe in terms of dollars, what could that opportunity be?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Yeah. I mean, answer, Chris, is we've been trying for the last couple of quarters to actually fill the channel back to where it should be. We had this call ninety days ago, and we said, hey. Channel inventory at that point was forty eight days. Now this quarter, it's fifty one.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

We said, hey, we'd like to build the channel back up and start working toward our target. And in fact, during the June, we anticipated trying to get more inventory in. But the reality is the dynamic that's happening within the channel is as we shift into channel and try to refill, customers actually are taking that inventory in terms of POS, and we can see it go out the other side in POS. We then follow-up with a subset of our end customers that we can reach and we survey them and ask them, hey, what's happening with the inventory? Are you just taking POS and putting on your shelf?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

And in fact, that doesn't seem the case. In fact, majority have to have lower end customer inventory. So we're sort of trying to track as it moves through channel. It looks like this is largely being consumed and deployed. I think it's a bunch of customers that are coming back slowly over time and we're seeing continued positive momentum.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

If we can refill the channel, we can. And like the last two quarters, we've been trying. I don't think you'll see any sort of big step up in any given quarter, but our intention is to move the channel from where we are this fifty one days to start to move it toward our target of seventy, seventy five days. I just think it's going to take a few quarters, Chris.

Christopher Rolland
Christopher Rolland
Senior Equity Analyst - Semiconducters at SIG Group

Excellent. Thank you, Dean. That's actually a lot of fill at seventy to seventy five. It'll be nice to see. I guess for my second question here, how are you got you mentioned tariffs.

Christopher Rolland
Christopher Rolland
Senior Equity Analyst - Semiconducters at SIG Group

How are you thinking about tariffs? And would you be passing this on to, customers? Or would you eat some of it? What what's your strategy here?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Yeah. I think, generally speaking, from our review of TRS, which, you know, as you know, rules sort of keep changing. It's all about the specific rules when they get published and and how those get rolled out. We've looked at a number of options among our supply chain. For the most part, it's relatively modest in its most extreme cases that we can of model out.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

It's a relatively modest impact on the company. I think our intention would largely be to pass them along if that comes. Again, we think the impact in itself is modest, so we don't think that would cause any undue harm across the customer base if that were to come to play. And there are some geographic sort of differences when we look at what is the amount of inventory that comes across The United States border was sort of the big contentious one. For us, it's kind of in the 10% range.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

So if whatever rate you want to assume on tariffs and every country has a different rate, generally we're shipping directly in by Silicon Labs only about 10%. So that's how we get to this sort of pretty modest impact, if you will, Chris.

Christopher Rolland
Christopher Rolland
Senior Equity Analyst - Semiconducters at SIG Group

Thanks, Dean. Congrats.

Operator

Thank you. And our next question comes from Cody Acree of The Benchmark Company. Your line is open.

Cody Acree
Equity Research Analyst at The Benchmark Company LLC

Thanks guys for taking my questions and congrats on the progress. Maybe, Matt, if you can help us with just any of the WiFi strength that you mentioned, just any of the application wins and any of the ramps that you're seeing there?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Yeah, sure. Continued progress in WiFi. Biggest The one that we just shared in the prepared remarks, which is really worth pointing out is the Roku design. What's unique about that is where we have shined, where we have focused in this space is playing to our strengths, which is battery powered applications. Long battery life, as we've shared our device, know, longest battery life in the world for a Wi Fi application and that's what Roku is taking advantage of.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

So they put a 1080p camera out there that can operate for up to two years on battery power, which is pretty remarkable. That's on store shelves at Walmart, available at Amazon and other retailers. And I think that is a good example and indicative of what we're seeing in Wi Fi overall, where as we bring this capability to bear in the market, customers are starting to take advantage of it, especially in battery powered applications to do things they could not do before. So we like what we see there. We like the progress.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

As always, it's a new market. It always takes longer than you want, but it's going in the right direction.

Cody Acree
Equity Research Analyst at The Benchmark Company LLC

Thanks for that. And maybe just lastly, with your September back now above $200,000,000 a quarter, your trajectory is definitely promising. But any thoughts on, given your pipeline and your visibility, when you would expect to be able to challenge your prior '22 highs? Do you think that that's something you can achievably get into a range in '26?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

So we're not guiding beyond the quarter, but maybe the most helpful thing that we can share is kind of in line with what we shared not that long ago at our Analyst Day. We have been securing a tremendous amount of design wins over the last few years. And those are just now starting to ramp. And to help make that real, one stat that we shared was in our Series two platform, kind of the current or prior gen, however you want to think of that, of what we've secured, we've only shipped a little over a billion units in that space. We've secured more than another 6,000,000,000 units of wins that we haven't shipped yet that are starting to ramp or will be ramping.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

So that kind of gives you a sense of what's been won and what's to come. As we said at the same time, we're still many more designs in Series two. It is still ultra competitive while we're bringing in Series three the next generation. You know, had a press release yesterday where we brought you know the highest level security to the IoT at the PSA level four, which is just an indication of what's going to start to come out on this platform as we introduce it new to industry, new to world capabilities, features and performance. So that combination I think positions us really well for continued growth going into next year.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

But you know not specific on timeline and that's obviously not easy to call.

Cody Acree
Equity Research Analyst at The Benchmark Company LLC

Of course, thanks for the color guys.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Thanks Cody.

Operator

Thank you. And our next question comes from Peter Pan of JPMorgan. Your line is open.

Peter Peng
Equity Research at JP Morgan Chase & Co

Hey guys, thanks for taking my questions and congratulations on the strong results. I think back at your Analyst Day, you gave a number on your new customer ramps being 50% of your year over year growth in 2025. And if I kind of work on what the consensus numbers are, that's about $100 plus million. Just given some of the commentaries about how you said 10 of those numbers are on track, does that are we surpassing that number? And more importantly, I guess, does that number start to grow in 2026 as well?

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

Peter, it's Matt. I don't remember the exact number you're quoting, but maybe the most helpful thing around that is we mentioned, I think 10 of our top 12 ramps, and just to be clear, there's many more ramps that we're tracking as part of that. So that's just kind of the biggest ones that have the easiest to track most visibility, but tip of the iceberg in terms of the ramps that we're working on and managing. Tough to correlate that to a specific number, But going back to the prior question and comments, we do expect continued ramps and continued growth based on design wins and share gains. That's the fastest and easiest way I can say it.

Matt Johnson
Matt Johnson
President, CEO & Director at Silicon Laboratories

We have been gaining share and we believe we're going to continue gaining share and we have opportunity funnel and design win momentum to support that.

Peter Peng
Equity Research at JP Morgan Chase & Co

Got it. Okay, that's helpful.

Peter Peng
Equity Research at JP Morgan Chase & Co

And then when I kind of look at your some of the seasonal trends, typically your December quarter is flattish, but you guys have been kind of driving above seasonal trends for the past several quarters. And so just given some of these positive booking trends and design win ramps, is there is it possible to drive sequential growth through the remainder of the year?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Yes. Peter, you're asking about a Q4 guide, which we're not at a point we're ready to comment on. Look, most of our momentum really has been on design wins coming into production. And if that's the case, you should actually outperform seasonality. One of the sort of notable things which, just so everybody has it, is all throughout 2025, lead times that we're getting orders have been more and more turn space.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

So it limits some of our visibility a little bit to be able to comment on, hey, what does seasonality look like in a quarter or two from now and how that's evolving? But I think to the extent that design wins continue to be the primary growth driver, you should continue to do a little better than sort of a steady state market driven only number.

Peter Peng
Equity Research at JP Morgan Chase & Co

Thank you.

Operator

And we have a follow-up from Tore Svanberg of Stifel. Your line is open.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

Yes. Thank you. Just one quick one for you, Dean. 20% tax rate, obviously, you know, with the big beautiful bill, that number is probably gonna change. So I don't know if you have any comments there.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

Should we just sort of wait to see how things develop? Or do you have an early read on 26 tax rate?

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Well, so our non GAAP long term tax rate of 20%, we tend to assess that on an annual basis or as needed In fact, this one big beautiful bill that ended up passing on July 4 actually was on the very last day of our quarter. Our quarter ended on July 5, just given the fiscal cycle this time. So we have included all of the tax related adjustments that we think are in, but those are on the GAAP side of the books. On a non GAAP basis, we haven't yet assessed what that impact would be longer term.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

I think it's sort of marginally lower, but whether that ends up changing sort of the longer term sort of time horizon that we have yet to come to a conclusion on, Tori.

Tore Svanberg
Tore Svanberg
Managing Director & Senior Analyst at Stifel Financial

That's fair. Thank you.

Dean Butler
Dean Butler
SVP & CFO at Silicon Laboratories

Yep.

Operator

Thank you. I will now hand the call back to Giovanni Pachelli.

Giovanni Pacelli
Giovanni Pacelli
Senior Director of Finance at Silicon Laboratories

Thank you, Didi, and thank you all for joining this morning, and thank you for your interest in the company. Before concluding today's call, I'd like to announce our upcoming participation in KeyBank's Technology Leadership Forum on August 11 in Deer Valley, Utah. This now concludes today's call. Thank you.

Operator

This concludes today's conference call. Thank you for participating and you may now disconnect.

Executives
    • Giovanni Pacelli
      Giovanni Pacelli
      Senior Director of Finance
    • Matt Johnson
      Matt Johnson
      President, CEO & Director
    • Dean Butler
      Dean Butler
      SVP & CFO
Analysts
    • Quinn Bolton
      MD - Equity Research at Needham & Company
    • Tore Svanberg
      Managing Director & Senior Analyst at Stifel Financial
    • Thomas O'Malley
      Director - Equity Research at Barclays
    • Christopher Rolland
      Senior Equity Analyst - Semiconducters at SIG Group
    • Cody Acree
      Equity Research Analyst at The Benchmark Company LLC
    • Peter Peng
      Equity Research at JP Morgan Chase & Co
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