Ladies and gentlemen, thank you for standing by. Good afternoon and welcome to the Knowles Corporation Fourth Quarter and Year-End 2015 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. With that said, here with opening remarks is Knowles' Vice President of Investor Relations, Mike Knapp. Please go ahead.

Thanks, Latoya, and welcome to our fourth quarter and year-end 2015 earnings call. I'm Mike Knapp, Vice President of Investor Relations, and presenting with me on the call today are Jeff Niew, our President and Chief Executive Officer; and John Anderson, our Senior Vice President and Chief Financial Officer. Our call today will include remarks about future expectations, plans, and prospects for Knowles, which constitute forward-looking statements for purposes of the Safe Harbor provisions under applicable Federal Securities Laws. Forward-looking statements in this call will include comments about demand for company products, anticipated trends in company's sales, expenses and profits, and involve a number of risks and uncertainties that could cause actual results to differ materially from current expectations. The company urges investors to review the risks and uncertainties in the company's SEC filings, including, but not limited to, the Annual Report on Form 10-K for the fiscal year ended December 31, 2014, periodic reports filed from time-to-time with the SEC, and risks and uncertainties identified in today's earnings release. All forward-looking statements are made as of the date of this call, and Knowles disclaims any duty to update such statements except as required by law. In addition, any non-GAAP financial measures referenced during today's conference call can be found in our press release posted on our website at knowles.com, including a reconciliation to the most directly comparable GAAP measures. Except for revenue, all financial references on this call will be non-GAAP, unless otherwise indicated. Also, we've made webcast slides available in the Investor Relations section of the website, which we will refer to during this call. With that, let me turn the call over to Jeff, who will provide some details on our fourth quarter results. Jeff? Jeffrey S. Niew - President & Chief Executive Officer: Thanks, Mike. Thanks…

Thank you. First question is from Harsh Kumar of Stephens. Your line is open.

Yeah. Hey, guys. Lots of stuff going on; have a lot of questions. But let me first say that it looks like your largest customer is stabilizing. So congratulations on that, guys. Let me start off with your largest customer. So what should we expect that to be as a percentage of sales after you exit this discontinued business? Jeffrey S. Niew - President & Chief Executive Officer: I don't know if I have the exact number in front of me, Harsh, but what I would just say is, we only have one customer as a company that's over 10% of sales in 2016. And I don't know, John... John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. Harsh, I can – when you look at the 2015 10-K, which will be filed shortly...

Okay. John S. Anderson - Chief Financial Officer & Senior Vice President: ...you'll see our largest customer represents about 25% of our sales in 2015. That will go to less than 20% – we expect that to go to less than 20% in 2016.

Okay. So your largest customer will be less than 20% in 2016 and this is of course – okay, got it. And then, curious, your margins are jumping up nicely in March quarter from a variety of reasons. You're cutting costs in Audience, you're taking out stuff. I was wondering if, John, you could take us through – I think you gave us how much of the OpEx reduction will be from the sale of the existing business. But I was wondering if you could also give us an idea how much Audience are getting – or the acquisition of Audience, how much of that is built-in in terms of continued cost reduction in the March quarter? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. I mean, Harsh, a couple of things. First of all, as I said, we are on track with our goal of getting $25 million in annualized cost reductions by the end of Q1. I also talked about our overall decline in operating expenses being roughly $4 million a quarter due to the reclassification of speakers/receivers into discontinued operations. And then, on top of that, we have other cost takeout in our, I'll call, continuing business. Jeffrey S. Niew - President & Chief Executive Officer: And just to make one other comment, we did talk about a reduction in R&D that – we've talked about this on previous calls, the possibility of taking out some non-core R&D as we look for projects that were very speculative and long term. And we've done some of that already in Q4, which starts taking effect in Q1.

Okay. And then, just one more and I promise I'll get back in queue after this. Your acoustics business, your hearing health business jumped up quite a bit. Is there any specific reason, Jeff, that drove that? Jeffrey S. Niew - President & Chief Executive Officer: There is normal seasonal trends. I think we talked about – it's one of the best quarters we've ever had in our acoustics business. I think the longer-term trends here, Harsh, are still very positive in terms of demographics. Emerging markets starting to buy hearing aids. I also think that we've done pretty well in terms of MEMS microphones in this space. That's relatively new. We've been in the MEMS microphone business for more than 10 years, but the hearing health market has been recently adopting it and that's been a real help to our business.

Hey, congratulations, guys. Looks like you're making progress on your long-term plans. Thanks again. Jeffrey S. Niew - President & Chief Executive Officer: Thanks, Harsh.

Thank you. The next question is from Jaeson Schmidt of Lake Street Capital. Your line is open.

Hey, guys. Thanks for taking my questions. I know in the release you said the speaker and the receiver product line was about $235 million in 2015. How much of – first of all, was that down in 2015? And if so, by how much? John S. Anderson - Chief Financial Officer & Senior Vice President: It was up modestly in 2015. Jeffrey S. Niew - President & Chief Executive Officer: Yeah. Up modestly.

Oh, okay. And then, how much was China as a percentage of Q4 revenue? Jeffrey S. Niew - President & Chief Executive Officer: I think we have that written down here somewhere. I can give you just... John S. Anderson - Chief Financial Officer & Senior Vice President: Maybe go to the next one. We'll pull this up and we'll have it for you in a second.

Okay. Just wondering if you could comment on what you're seeing from the infrastructure market and sort of your outlook for the rest of this year? Jeffrey S. Niew - President & Chief Executive Officer: Yeah. It's hard for me to predict the full year of how we sit there and say infrastructure going, but I would just say this is – 2015 was a pretty tough year in terms of infrastructure. I think, as we said in the last call, I'll say it again, the business has stabilized. We do see, I would say, some modest improvement in the business, but we're yet to see any, like, what I would say wholesale large improvement in the business over the 2015 levels. So I would say it's been very stable now for a couple of quarters. John S. Anderson - Chief Financial Officer & Senior Vice President: Just to follow-up to your question with Chinese OEMs, it was roughly 15% of our Mobile Consumer sales in Q4.

All right. I'll jump back in the queue. Thanks a lot, guys. Jeffrey S. Niew - President & Chief Executive Officer: Thanks, Jaeson.

Thank you. The next question is from Bob Labick of CJS Securities. Your line is open.

Good afternoon. Thanks. Wanted to start – you've said in the past you had mid-term financial targets of gross margins of 39%. And then, the free cash flow is 12% of sales. You also mentioned that this divestiture should improve your free cash flow profile. Can you give us a sense of where those numbers may go? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. I mean, based on the full-year guidance I provided today, you can see we're at our mid-term model in terms of gross profit margin. We're currently investing heavily in R&D. And as we get leverage in the intelligent audio space and grow the top line, we'd expect our operating margins to go up with it.

And is it safe to say that the free cash flow though in the future is expected to be higher than that 12% prior target? John S. Anderson - Chief Financial Officer & Senior Vice President: You know what, at this point, we aren't changing our mid-term model targets, Bob.

Okay. And then, one other obvious outcome from this divestiture is the Specialty Components become a much larger percentage of your overall business. It's hard to tease out in particular the contribution from hearing health, given the changes in the composition of specialty components since you were spun. Is there a way you can help investors see the earnings contribution or the EBITDA or whatever you'd like to for hearing health to maybe value that on its own? It seems like it's a undervalued asset as part of your portfolio if it were a standalone business, but it's hard to tell what they actually contribute. Can you shine some light on that? Jeffrey S. Niew - President & Chief Executive Officer: Well, let me just make a couple of comments. First of all, we've kind of given pretty good guidance on the revenue side, that roughly of specialty or precision devices, roughly – or Specialty Components, sorry, it's about 50%. So we've kind of given the area. Generally speaking, I would say it's very tightly coupled though from an R&D standpoint as we go forward, especially with MEMS microphones into the Mobile Consumer with the MEMS microphone business, as we're seeing quite a bit of uptake on MEMS microphones in the hearing health business. As far as the earnings, we haven't really disclosed that in much detail. I would say the hearing health business is slightly better in terms of margins than the timing and the capacitor business. John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. Where it really comes in is the gross margins are fairly correlated with the precision device business. Operating margins are a bit better just because of operating leverage... Jeffrey S. Niew - President & Chief Executive Officer: So, you're leveraging spreads. John S. Anderson - Chief Financial Officer & Senior Vice President: ...and less operating leverage. Jeffrey S. Niew - President & Chief Executive Officer: We don't – in the hearing health business, we only have about 10 customers that makes up the majority of the sales. So, if you think about from that perspective, you have two separate businesses, capacitors and timing, which each require their own sales teams and R&D and it's very separate, so.

Okay. Fair enough. And then, last one. With the divestiture, are there any loss of microphone sales, any bundled sales in that regard? And what happens with N'Bass? Is that – do you still control that or what goes on with that? Jeffrey S. Niew - President & Chief Executive Officer: Let me start on the question of N'Bass. We are selling N'Bass as part of the speaker/receiver business. And when we sell the business, that technology and product will go with the sale. So, that will be expected. As far as bundling, I would just sit there and say, our focus, as we go forward, if we think about where we were, we were selling more products to the customers. But I think what we're starting to feel very strongly about is, we'd rather sell more advanced products in the areas that we have significant competitive advantage, specifically microphones. So, where we see really the bundling opportunity, where it's much more closely tied, is to sell a system level solution on the voice input side, which includes acoustics, signal processing and software. So, that's where we really see the real bundling opportunity.

Okay. Great. Thank you very much. Jeffrey S. Niew - President & Chief Executive Officer: Thanks, Bob.

Thank you. The next question is from Tristan Gerra of Baird. Your line is open. Tristan Gerra - Robert W. Baird & Co., Inc. (Broker): Hi. Good afternoon. How much cash do you expect to have in your balance sheet exiting Q1? And also, if you could give us a sense of your utilization rates currently? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. Tristan, first of all, at the end of 2015, we had roughly $66 million in cash on hand and I'm sure you probably saw we did file an 8-K with an amendment to our credit facility. If you reflect that amendment and the adjustment to the credit facility, we have roughly $150 million of borrowing available. So, total liquidity, a little north of $210 million. From a cash burn rate in Q1, we would expect roughly – let me come back to you with the exact rate, including the discontinued operations, that's the one that I want to pull up. I mentioned on the call, we'll have cash generated from operations in the continuing business. Maybe we'll go to the next question, I'll pull this up. Jeffrey S. Niew - President & Chief Executive Officer: Your second question is around capacity utilization. Correct, Tristan? Tristan Gerra - Robert W. Baird & Co., Inc. (Broker): Oh, yes. Jeffrey S. Niew - President & Chief Executive Officer: Yeah. So let me just take a step. This is probably a good point I want to bring up at this point. If you think about Q4 last year with our largest customer, remember we deliver microphones much earlier in the process. And I would just sit there and say is, the inventory correction that we're seeing now in Q1 is probably larger than some of the…

Thank you. The next question is from Chris Rolland of FBR & Company. Your line is open. Christopher Adam Jackson Rolland - FBR Capital Markets & Co.: Hey, guys. Thanks for the question. So you guys paid I think a little more than $850 million for the speaker/receiver asset from NXP. How much of that has been written down now? And then, if you can't sell it, how much do you expect to realize in cash restructuring charges? John S. Anderson - Chief Financial Officer & Senior Vice President: So our intention at this point is to sell the business. Let me follow up with you on book value after the $200 million write-down that we had in Q4. Jeffrey S. Niew - President & Chief Executive Officer: We'll have to follow up on that. I don't think we have that right in front of us. Christopher Adam Jackson Rolland - FBR Capital Markets & Co.: Okay. Also, for 2015, it seems like the loss in that business was pretty big. I get the argument that you guys are sub-scale there, but do you think there really is a good chance that there's somebody big enough with enough scale to get a lot of profitability from this business? What do you guys think the odds are of selling the business and how much do you want for it? Jeffrey S. Niew - President & Chief Executive Officer: Well, we're in the process. We're starting the process kind of as we speak. So I think it's a little early or premature to make any comments on that. But let me just take a step back from how I view the business. I think what we look at overall is that there are people who are making money in this business, but…

Thank you. The next question is from Robert Sassoon of Lafferty. Your line is open. Robert Sassoon - R.F. Lafferty & Co., Inc. (Research): Hi. Thank you. You mentioned in your full-year 2016 outlook, modest full-year revenue increase. Assuming that – is that on a like-for-like basis taking out the speaker and receiver's business in 2016? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. That's for the continuing business. Robert Sassoon - R.F. Lafferty & Co., Inc. (Research): And what is the pro forma for 2015 in terms of revenue? John S. Anderson - Chief Financial Officer & Senior Vice President: It's in the investor deck and the supplemental; back in the appendix you'll see quarterly revenue for the continuing business. Robert Sassoon - R.F. Lafferty & Co., Inc. (Research): Right. And I think there was a question about Audience, and is your target still to break-even in the fourth quarter for Audience? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. So I think what we've said is, we're going to deliver the $25 million in the annualized savings which the majority have actually came last year, all right? And we have a little bit more coming this year. We have done some work to reduce, I would say, R&D as a total in terms of what we call non-core R&D that really doesn't have an impact on the long-term growth prospects for Knowles as a company. Short-term, there are some challenges relative to the Korean OEM with mix and what they're buying, but that's more of not just an Audience issue, that's an overall Knowles issue. And I think, the second thing is – the last thing I would say is that we're becoming more confident as we enter Q1 and…

Thank you. The next question is from Harsh Kumar of Stephens. Your line is open.

Yeah. Hey. John, I wanted to get back to some of the longer-term guidance. I tried to put my model out for this year. And I know you can't guide to it, but maybe you can help us think about this. Last year, I just totaled up. You did I think roughly $847 million in continuing operations. First of all, is that a good number to think about where we should be for 2016 or maybe slightly above that? And the question really is, to get to that kind of a number, we have to do a pretty significant increase in the MCE business, like a significant, significant increase in the MCE business, or am I missing something and there is an increase in the SCE business, as you get back some of the $30 million or so you lost in the base station. Can you just help us think about that? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. Harsh, first of all, your $800 million – and I think you said $847 million, very close to what we added, actually $850 million, if you add up...

Okay. That's fair. John S. Anderson - Chief Financial Officer & Senior Vice President: ...the supplemental schedules. And yeah, we are projecting a modest amount of growth on that business. And I would say it's spread across both segments. We are expecting growth in both Mobile Consumer, the continuing business as well as Specialty. Might be weighted a little more towards specialty as we see some recovery in the telecom and 4G infrastructure, but both segments, we do expect some growth.

And again for you, John, I think you had a comment in your – a comment that you made something about 50-50 split. Is that a 50-50 split between the two segments exiting 2016 or is that 50-50 for the whole year as we total up the two businesses? John S. Anderson - Chief Financial Officer & Senior Vice President: Full year.

Full year. Okay. Wow, okay. So, pretty dramatic growth than in the MCE side of the business in the back half as usual. John S. Anderson - Chief Financial Officer & Senior Vice President: In the back half of the year, that's correct. Jeffrey S. Niew - President & Chief Executive Officer: And there's a number of things. You have the normal seasonality. We have also new products that will be coming out that we're pretty excited about in the microphone space as well as we should start seeing some acceleration of revenue from intelligent audio.

That's actually correct. That's helpful. Thanks. Thanks, Jeff. And then, tax rate, I think you said 0% to 5% for this year. I want to make sure I'm right on this as I model out. And then 10% to 15% kind of past that? Jeffrey S. Niew - President & Chief Executive Officer: Yeah. Past 2016. 2016, we're going to continue to benefit from Audience losses, and if you think about it, we're benefiting losses in the U.S. that have rate of 35%. Our income specifically in Malaysia is very close to 0%. So we're continuing to benefit from that. As Audience losses diminish, that rate will go up. But that 5% was a full-year rate for 2016, and then beyond 2016, it's going to go up to the 10% to 15% level.

Awesome. And then, another one for you, either Jeff or John. So let's say last year was kind of you were getting back into your largest customer and this year again starting on funky manner. But in a typical normal year, if let's say 2016 turned out to be a normal year, your Mobile business, is that typically up sequentially from 3Q to 4Q or flat or slightly down? Jeffrey S. Niew - President & Chief Executive Officer: No, typically the Mobile business actually from Q3 to Q4 is down, but the peak quarter for us is typically Q3.

Understood. Thanks, guys. That's all I had. Thank you. Oh, one more – sorry. Interest expense for 1Q, would you have that handy? John S. Anderson - Chief Financial Officer & Senior Vice President: Yeah. Just anywhere between $3 million and $4 million, Harsh. There's not going to be a significant deviation from what we saw in Q4.

Got it. Thanks, guys.

Thank you. There are no further questions in the queue at this time. I'll turn the call back over for closing remarks. Jeffrey S. Niew - President & Chief Executive Officer: Great. Thanks very much for joining us today. As always, we appreciate your interest in Knowles and look forward to speaking with you on our next earnings call. Thanks and good bye.

Thank you. Ladies and gentlemen, this concludes today's conference. You may now disconnect. Good day.