Ladies and gentlemen, welcome to the Lattice Semiconductor's Third Quarter 2021 Earnings Conference Call. Your lines are in a listen-only mode. We'll open up question after management's prepared comments. I will now turn the call over to Mr. Rick Muscha, Lattice's Director of Investor Relations. Please go ahead.

Thank you, Operator and good afternoon, everyone. With me today are Jim Anderson, Lattice's President and CEO; and Sherri Luther, Lattice's CFO. We will provide a financial and business review of the third quarter of 2021 and the business outlook for the fourth quarter of 2021. If you have not obtained a copy of our earnings press release, it can be found on our company website in the Investor Relations section at latticesemi.com. I'd like to remind everyone that during our conference call today, we may make projections or other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such statements are predictions based on information that is currently available and actual results may differ materially. We refer you to the documents that the company files with the SEC, including our 10-Ks, 10-Qs and 8-Ks. These documents contain and identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements. This call includes and constitutes the Company's official guidance for the fourth quarter of 2021. If at any time after this call, we communicate any material changes to this guidance, we intend that such updates will be done using a public forum such as a press release or publicly announced conference call. Some financial information that we present during the call will be provided on both a GAAP and a non-GAAP basis. By disclosing certain non-GAAP information, Management intends to provide investors with additional information to permit further analysis of the company's performance and underlying trends. Management uses non-GAAP measures to better assess operating performance and to establish operational goals. For historical periods, we provided reconciliations of these non-GAAP financial measures to GAAP financial measures that can be found on the Investor Relations section of our website at latticesemi.com. Let me now turn the call over to Jim Anderson, our CEO.

Thank you, Rick and thank you, everyone, for joining us on our call today. I'm pleased with our strong results in Q3 as we delivered double-digit year-over-year revenue growth, driven by our expanding product portfolio and multiple growth vectors across our end-markets. Let me start by covering a few highlights from Q3 of 2021. We grew revenue 28% year-over-year and 5% sequentially, with double-digit year-over-year growth in each of our three market segments. We expanded non-GAAP gross margin by 210 basis points year-over-year to a record 63.6% as we continue to execute on our gross margin expansion strategy. We achieved record non-GAAP operating profit of 30.4%. In addition, we drove 49% year-over-year increase in non-GAAP net income. And we continue to expand our hardware and software capabilities with new product enhancements. Let me now provide an overview of our business by end-market. In the communications and computing market, revenue increased 6% sequentially and 26% on a year-over-year basis. As we've highlighted previously, our key long-term growth drivers in this segment are Data Center Servers, Client Computing and 5G infrastructure. In Servers, growth continues to be driven by expansion in both attach rate and ASP as we continue to drive an increase in our dollar content per server with each new server generation. In Client Computing growth is driven by the ramp of customer programs that started last year and have continued into this year. In addition, we're engaged with customers on new programs that will generate revenue in the coming quarters. Lastly, we were pleased with our growth in 5G Infrastructure in Q3 as 5G continues to be deployed worldwide. Turning now to the Industrial and Automotive market, revenue increased 3% sequentially and was up 40% on a year-over-year basis. Q3 growth in the Industrial segment reflects strong customer adoption…

Thank you, Jim. We are pleased with our strong Q3 financial results as we continue to execute to our financial model. We drove strong sequential and year-over-year revenue growth, significantly expanded gross margin and delivered record profitability while continuing to invest in our leadership product road map. We drove strong cash generation and continued to return cash to shareholders. Let me now provide a summary of our Q3 results. Third quarter revenue was $131.9 million, up 5% sequentially from the second quarter and up 28% year-over-year. Revenue grew double digits year-over-year in all three of our end-markets with sequential growth as well. IP revenue was down year-over-year but was up on a sequential basis. Gross margin on a GAAP basis was up 150 basis points to 62.8% in Q3 compared to the prior quarter and was up 230 basis points compared to the year-ago quarter. Our non-GAAP gross margin increased 150 basis points to a record 63.6% in Q3 compared to the prior quarter and was up 210 basis points compared to the year-ago quarter. Both the sequential and year-over-year increases in gross margin continued to be driven by our margin expansion strategy. On a sequential basis, we also benefited from higher IP revenue. Q3 GAAP operating expenses were $55.8 million compared to $53.9 million in the prior quarter and $49.5 million in the year-ago quarter. On a non-GAAP basis, operating expenses were $43.8 million compared to $41.5 million in the prior quarter and $36 million in the year-ago quarter. Our R&D expenses increased sequentially as we continue to invest in our product portfolio. Q3 GAAP earnings per basic share was $0.20 and $0.19 per diluted share compared to $0.16 and $0.15 in the prior quarter and $0.09 in the year-ago quarter. Q3 non-GAAP earnings per basic share was $0.29…

And your first question comes from the line of Alex Vecchi from William Blair. Your line is open.

Hi, everyone. Congratulations on another impressive quarter. I guess to start, I'll hit on -- I'm not sure we used the same margin but the impressive gross margin results, you guys really hit it out of the park there. Can you maybe give a little more color into maybe some of the mix or within each end market, there were certain products that lifted the overall gross margin, given that as a percentage of revenue, the end markets looked relatively stable? And maybe comment on if you've been able to sort of raise prices or push through any increased costs from the constraints out there?

Thanks, Alex. So from a gross margin perspective, we're actually really pleased with the results for the quarter, a record 63.6%, 150 basis point sequential improvement and 210 basis points improvement year-over-year. It's really coming from our gross margin expansion strategy that we talked about at our Investor Day earlier this year and actually that we had put in place back in 2019 as we continue to execute primarily on pricing optimization in Q3 is where you saw a lot of the benefit coming from and really strength in all of our markets driving the gross margin improvement. And when you look to our Q4 guide, at the midpoint, that reflects, again, sequential improvement in gross margin from our gross margin expansion strategy. And as we drive towards the long-term target model that we laid out of 65%.

Perfect. That's helpful. And then just in terms of industry supply constraints, it looks like inventory dollars were roughly flat and days were also roughly flat. Can you maybe comment on if you're seeing sort of any slower growth there because you're unable to meet sort of customer demand? Or I know you guys did a good job back in April of really sort of building up inventory in front of COVID. But maybe if you could touch on that a little bit.

Yes, thanks, Alex. So on supply constraints, yes, certainly, industry wide, there's certainly supply chain tightness. And of course, we're not immune to that. But I do think our supply chain team has been doing a really good job navigating the environment and supporting our customers. And if you remember last year, we actually proactively built strategic inventory to get ahead of the potential supply chain tightness. We started doing that in Q2 of last year and we grew our Lattice inventory in Q2, Q3 and Q4 of last year and that inventory build last year certainly helped us navigate the current environment and support our customers well this year. Now there may be particular silicon package combinations that are tight in terms of supply for us. But in general, I think, again, our team continues to do a good job supporting our customers. I think our customers would agree with that as well. But hopefully, that's a little bit of color, Alex.

Yes, that's very helpful. With that I'll go back in queue.

And our next question comes from the line of Tristan Gerra from Baird. Your line is open.

Hi, good afternoon. A quick follow-up question on gross margin. So is your price optimization strategy benefiting from the current tightness in supply? Is it helping? Or is it completely separate? And if the current environment continues, should we stop thinking about a potential longer-term for your gross margin to be similar to that of high-density FPGAs? And finally, are you de-emphasizing any product that you consider either legacy or low-margin given the tightness in supply that could also help the mix? Thank you.

Yes, thanks, Tristan. So first of all, on the pricing. Remember, we've had a pricing optimization strategy that we put in place back at the beginning of 2019. So that's almost three years now, we've had that strategy. And again, that's really focused on -- we view it as making sure that we're pricing our products correctly in the marketplace for the value and the differentiation that they bring to our customers. And I would say the current supply chain constraints, kind of regardless of that, we've been driving that pricing optimization strategy. But certainly, in the current environment, it makes it even a little bit easier, no doubt. On the second part of your question around, I think you're getting at gross margin target over time. As you remember from the May Investor Day that we did earlier this year, we put a target out of 65%. Certainly, now we're focused on towards that 65% gross margin target. When we get to that target, we'll take a look at if there's a new target for us to set for ourselves. But in the meantime, we're focused on making progress towards our gross margin target as quickly as we can. On the -- I think the third part of your question was around are we de-emphasizing any lower margin product? Yes, that's not the case. What we're trying to do is make sure that we're supporting all of our customers and making sure we're meeting demand for all of our customers across all of our end markets. So yes, not de-emphasizing any particular products.

Okay, great, that's very useful. Just a quick follow-up. How much of the revenue momentum you're seeing is coming from Nexus? And any touch point you could give us on where that could be as a percent of revenue exiting next year?

Yes, thanks, Tristan. So Nexus is certainly a contributor to the growth that we're seeing this year. We're quite pleased with our revenue growth for the first three quarters here of the year, this quarter being 28% year-over-year in Q3. And Nexus is certainly a contributor to that. Although our pre Nexus products are driving growth as well. Just as a reminder on kind of where we're at in the Nexus ramp is we've launched four Nexus device families. The first two which is CrossLink-NX and Certus-NX, those have already entered production have been ramping nicely into production. And then we have a third device that goes into production towards the end of this year. That's Mach-NX. And then the fourth device we launched earlier this year, that will start to generate production revenue next year. So yes, all of those products executing on track. We're pleased with the revenue ramp, they're contributing to growth year. And we would certainly expect them to contribute to growth next year as well.

Great, thanks again.

And our next question comes from the line of Hans Mosesmann for Rosenblatt. Your line is open.

Thanks. Congratulations team. Sherry, on your side of the business, you guys are not raising prices. I'm assuming that input costs are going up but you're not passing that on to customers. Is that correct?

Yes. So Hans, thanks for the question. So the way that we're looking at it, if it makes sense for us to pass it on to customers, then we will. But if you recall, we have our gross margin expansion strategy for pricing optimization. We've had that underway since 2019. So we've got a number of initiatives underway where -- that kick in at various points in time to really get the value for our products. So that's really what we're focused on, getting the value for our products from our customers.

Yes. And the only thing I would add, Hans, is certainly, if we see higher product costs, we'll certainly seek to pass that along to our customers as well.

Okay. And then as a follow-on, hey Jim, on these new Nexus products, is the incremental design activity better than the previous generation product? Is that one way to look at it? And then if you can give us granularity on Avant, what's the interest level over the past quarter? Is it -- if you can just give us some subjective kind of commentary, that would be helpful. Thanks.

Thanks, Hans. Yes. So on Nexus, definitely, the design momentum is much stronger than prior product generations. In fact, I think probably our strongest platform launch with FPGA ever, certainly within the last decade for the company. And our sales team, as you can imagine, very happy right now. They're -- in terms of the design win progress on Nexus, multiple new families that we've launched and we're just seeing very strong customer engagement and design win momentum actually across each one of our market segments. And then you asked about Avant, too. we're really excited about that. The execution is going very well. We're continuing to execute towards a target launch in the second half of next year. And then on customer momentum there as well. Customer engagement, very strong. As we shared earlier this year, over 100 customers engaged in Avant. Some -- many of our large strategic customers engaged since the very inception of Avant. And so yes, we're really excited about that. The engineering team is executing well and the sales team is very busy, engaged with many customers and working on many different design wins.

Okay. Thank you

And your next question comes from the line of Matt Ramsay from Cowen. Your line is open.

Thank you very much. Good afternoon. I guess, Jim, I wanted to ask a couple of questions about some particular end-markets that you guys are exposed to and are no doubt driving some of the growth you're seeing in the model. The first one is in the Data Center space. It looks like the comms and computing business is up, I don't know, 25% or so year-over-year which is a great number. And the reason I'm bringing it up is we talked a number of times over the years about the content expansion that you guys expected going from Grantley to Partly to Whitley at Intel when they were in the majority of the market. And you have Genoa from A&B and Sapphire Rapids on the Eagle stream platform and Intel coming in the next, I don't know, several quarters. So both big vendors upgrading systems at the same time. If you could give us a little color on what you're expecting there from a Lattice opportunity standpoint. Thanks

Yes, sure, thanks, Matt. Yes, the server space or data center, in general, this has been a really strong growth area for us for actually several years now. And definitely a contributor to the strong growth we saw in the most recent quarter, the 26% year-over-year growth. Although I will note really quickly, not just servers grew for us in Q3 but so did our client revenue as well as 5G revenue which also fall in that category. But on servers, what our focus has always been is to -- with each new server generation to increase our dollars of content per server. So that with each new server generation, we've got more dollar footprint on that server across all of our customers. And we've been able to do that over multiple generations and certainly focused on that on the next-generation as well. In fact, as we shared at the Investor Day back in May, in the next generation, we're targeting a 50% increase in the dollars of content per server. And the two main drivers of that are attach rates and ASP. And on attach rate, we've seen our attach rates steadily increase on servers and now our attach rate exceeds 1x, meaning that on average, if you take the global number of servers that ship on average, there's more than one Lattice device used on each server. And so our attach rate continues to increase. And then with each new generation, we brought additional content and capability to the servers and that's translated into higher ASPs. And when you multiply those two factors together, you see a strong dollar content increase in each server generation. And so that's certainly what we're focused on, not just for this near-term server generation but over multiple generations with our key strategic customers.

Got it. Very helpful, Jim. I guess a similar question, different end-market drivers, et cetera. But in the automotive space, there's a lot going on, supply constraints, super topical but you have these sort of parallel vectors of electrification and intelligence/autonomy which I think many investors would agree are driving semiconductor content opportunities. I wonder if you might talk about what you're seeing in the automotive market from a design win perspective. And how much of a driver that can be for your company over the next couple of years? Thanks.

Thanks, Matt. Definitely, we see this as a great long-term growth driver for the company. Even in the most recent quarter, Q3 or through the first three quarters of this year, seen really strong growth year-over-year. And so it's been a great growth engine for us this year. Although in that segment of industrial and auto, it's still a relatively small percentage. Industrial is still the larger portion of that industrial automotive market for us. But as we move into future years, we definitely have a very full design win pipeline, design wins across ADAS and infotainment applications. There's a number of different ways that we can get used in automotive electronics that we're getting designed into. So it's certainly an area that we see good growth today but multiple years of good growth that we're expecting in the years to come as well.

Thanks, Jim. So a quick one to squeeze in, for Sherri. If you have any color on the -- by segment breakdown in the guide for the fourth quarter, that would be really helpful. Thank you so much.

Yes. So we don't actually provide the by segment breakdown but in detail. But what I will say is that the -- we're expecting it to be flat to sequentially up for pretty much all the end-markets. So that's probably the best way you can look at it.

All right, thanks so much.

Your next question will come from the line of David Williams from Benchmark. Your line is open.

Hey, good afternoon. Thanks for letting me ask a question and congrats on the quarter. I wanted to kind of touch maybe on just the mix and how you think about that over time, especially as you make progress in the automotive space, industrial has been very strong. But do you think there's an opportunity to grow your automotive content, especially kind of given the transition of perhaps some MCU to over to FPGAs. And just maybe anything in terms of the mix there that you think could benefit in the future.

Yes. I think within the Industrial Automotive segment, within that segment, I think, over time, yes, I think over time, we do expect automotive to become a bigger percentage of that segment over time. At a higher level, at a company level, when you look at comms and compute as one of our large segments in industrial and automotive, as other large segments, in fact those two combined represent over 85% of our revenue. I think that we expect both those segments to grow at a very healthy clip over the coming years. And so I'm not sure there'll be so much mix change between those two bigger segments. But within the industrial automotive segment, automotive could become a larger portion of that over time.

Okay. Great. And then, Sherri, maybe one for you. If we -- we're kind of thinking about the revenue growth trajectory for the next -- over the next year, given where you're tracking today, about 24%, looks like on the guidance, do you think that the new products and the design win momentum that you have, can you continue this growth maybe in the high-teens range, maybe on an annual basis? Or how should we think about maybe the intermediate term kind of growth trajectory here?

Yes. So if you go back to our Investor Day in May this year, where we talked about our targets, we said that when -- we'll sort of the low double-digit revenue growth until we get to our Avant platform that will really drive the double-digit growth in the longer term. And so that's kind of the way you can think about the short-term to the longer-term trajectory and really Avant driving that double-digit long-term perspective.

Okay, that's fair. Thank you. And then maybe just one last one. Just thinking about the solution stack to the 5G O-RAN. Just wondering what the feedback has been and how that's progressing. It's still on track for release next year.

Yes. David, on track for release in the first half of next year. I think our customer feedback has been very positive. Customers looking forward to that and we're working with them and make sure we're fine-tuning the feature set so that it's exactly what the customers need. But yes, remains on track and we'll certainly provide more details on that 5G O-RAN stack as we get closer to the launch.

Fantastic. Thanks so much.

Thanks, David.

And your next question will come from the line of Christopher Rolland from Susquehanna. Your line is open.

Hey, guys, thanks for the question. I guess my question is about ASIC substitution by FPGA here. And we've seen a lot of the large guys out there with de-commits. And I was wondering if you and the team had a thought around how much there was ASIC substitution by FPGA? I don't imagine it's a lot of your revenue but is it any? Have you heard of these stories? And have you guys contemplated how that kind of mix is out or what happens to that over time?

Yes, Chris, we don't -- for our devices, we don't typically see ASIC substitution. Remember, we're focused on the smaller FPGAs, very power efficient, easy to use. It's not -- it's very rare that we see customers substituting out our part for an ASIC. I think most customers are actually designing our chips in or FPGAs in general because of the reconfigurability of them. So for instance, a lot of our customers are designing in artificial intelligence capability. They want to add more decision-making capability to their systems. So they're designing in artificial intelligence or inference processing. And our FPGAs are just a great match for that. They do inference or AI processing incredibly efficiently because it can be programmed as a parallel processor. AI algorithms are inherently parallel algorithms. And they know that those algorithms are going to change over time. And so they want the flexibility of being able to reprogram the FPGA. So yes, we typically don't see ASIC substitution.

I guess what I was saying was, have you seen FPGAs replace ASICs when ASICs aren't available because of de-commits because they can't be the other way around.

Okay. Sorry for the misunderstanding. Yes, what -- I guess the way I would say it is, our -- for instance, I'll give you an example in Industrial. So there's a number of customers we're working with in the industrial space that were already strategically aligned to us to move towards the Lattice road map, the Lattice product portfolio and the road map moving forward. And so we were already -- they were already planning to switch to Lattice devices for the very reasons I just talked about, the artificial intelligence processing, the flexibility and some of the software content that we're providing. I would say that the supply chain constraints are really, in some cases, catalyzing that or accelerating that customer transition. So transitions that the customers were already planning to do, we've seen an acceleration in their timeline because with many of those customers, we've supported them much better than some of their other suppliers through the supply chain constraints. And so they've accelerated their plans to switch or convert to Lattice. And that can mean switching from a competitor's FPGA to Lattice FPGA or in a number of cases, switching from a microcontroller is the most common ASIC -- switching from a microcontroller to a Lattice FPGA. So yes, we are seeing an acceleration in that activity.

Yes. And I guess now that you bring it up, I think, guys, some of your competitors in the high-density space have just incredibly long lead times right now. They just can't service products. And have you -- do you think you're a beneficiary there? Have people moved? I know Avant's not out yet but is there any fungibility between the two platforms?

Yes. We believe that we're benefiting from the fact that we have a very strong fresh product portfolio with Nexus and the multiple device families that we've launched as well as Avant to the road map. The customers see that we've got a very fresh set of products, brand new, strong software content. And then you combine that with the fact that we've generally, we believe, done a really good job of supporting our customers and I think our customers definitely see that as well. And in a number of cases, they've accelerated the transition from one of our competitors' FPGA to us or as I mentioned, microcontroller to Lattice devices. So yes, certainly, we believe we're benefiting from that.

Great. Thanks guys. I'll get back in queue.

Your next question comes from the line of Derek Soderberg from Colliers. Your line is open.

Hi guys, thanks for taking my question. I wanted to start with the supply environment. It seems like you guys have executed well on that front. I'm wondering, first, if you guys need to secure additional supply commitments to sort of meet your long-term revenue growth targets for next fiscal year. And beyond that, just given the demand trends, you feel comfortable with where your supply commitments are today to service quite a bit more than -- more demand than you've sort of been servicing today, if that's the case. So we'll start there. And then just one on top of that. Are your suppliers adding capacity? And if so, when would you expect that to come online?

So on the first part of the question, we're certainly always working with our suppliers on not just next year's capacity but multiple years out. And in fact, all the way back to the beginning of 2019, we were working with our suppliers on multi-year road maps on both product cost as well as capacity. So it's something that we're always engaged with our suppliers over the long-term to make sure that the capacity is in place. And so yes, we are very actively engaged with our suppliers on that. On the second part of your question, yes, certainly, we're seeing all of our suppliers continuing to add capacity in anticipation of future years demand, not just from growth from us but from the growth from the industry in general. So yes, we're seeing our suppliers add capacity at a pretty fast rate.

Got it. And then my -- as my follow-up, revenue guidance was a little bit wider than I think it historically has been, granted only by $2 million. Is there anything out there that's contributing to the wider revenue range -- guidance range? Or should we really not read into that? Just curious if there's anything you're seeing out there that led to a slightly wider revenue guidance range?

Thanks, Derek. No, I wouldn't read anything into that. I think it's -- actually, if you look at the range as a percentage of baseline revenue, I think it's actually pretty consistent with what we've done in the past. I think our revenue has grown and so we've widened the range a little bit but kept the kind of percentage range about the same.

Great, thank you.

And your next question comes from the line of Richard Shannon from Craig-Hallum. Your line is open.

Thanks for taking my question. Jim, I've got kind of a 3-part question on competition and it may slightly overlap with some of the previous questions but love to kind of put this all together here. So in the last few years, you've really been aggressive and fast in introducing new product lines in global and the FPGA space. And then more recently announced one in kind of the mid-range here. Wondering if you've seen any change in competitive dynamics with the kind of legacy competitors in this space, whether they increased their level of competition or alternatively even decreased -- that's clearly not where their focus is. And then to add to this, when you look at your kind of emerging competitor base here in microcontrollers, are you seeing any increased competitive dynamics coming from that set of companies as well?

Thanks, Richard. So on the first set, kind of our traditional FPGA competitors, I don't think we've seen a significant change in the competitive environment. Where Lattice is focused is -- today is really focused on the small FPGAs with our Nexus platform, small, very power efficient, easy to use, lots of software content to get to market quickly for our customers. And where we see our two traditional competitors is really at the other end of the spectrum, making -- focused on very large complex FPGAs, optimized ground, for instance, data center, compute and offload. And we really haven't seen a significant change in that strategic focus. And then as you mentioned, we're certainly executing on our new Avant platform which is targeted at mid-range FPGAs. And there, again, we haven't seen any significant change in the competitive landscape of where Avant is targeted either. In terms of on the MCU competition, I would say that we're in a very good competitive position in -- against certain parts of the MCU market. And it has to do with what I talked about earlier, is if you look at customers and what they're doing with their system design is in a number of cases, they're trying to add more intelligence, more decision-making capability to their systems. And what that means is adding more AI and inference processing. And FPGAs in general but Lattice FPGAS, in particular, are really good at doing inference processing, especially in edge applications because of the parallel nature of FPGAs and that's a great match for those algorithms and the fact that the FPGA can be programmed -- reprogrammed as the algorithm changes, it just makes it a really good fit for a number of applications. So we are seeing a good conversion from microcontrollers to FPGAs as those customers want to add more intelligence and AI capability to their systems.

Okay, great, thanks for answering my question. That's all for me.

And your next question comes from the line of Christopher Rolland from Susquehanna. Your line is open.

Thanks for the follow up, guys. It's been a while since we've talked about M&A and that could be the next leg for your story as well. I guess, maybe talk about your interest in doing M&A and kind of what you see out there and whether you're more interested in pursuing kind of an FPGA centric technology out there or something maybe more broad IP that you could fold into the FPGA category?

Thanks, Chris. So on M&A, certainly something that we're actively looking at. I would start by saying, though, that we're never confused about what job one is. Job one is always to grow our organic business, to make sure our organic business is growing as fast as possible. But that said, we're always scanning the environment, the landscape for inorganic options. The way we look at it is we're looking for things that are very complementary, very adjacent to our existing product portfolio and strategy, really looking for things that would accelerate our organic strategy. And those type of things could be more hardware-centric acquisitions, those could be more software-centric. And they would really fall into, I think, two or three buckets. One would be -- could be product-related inorganic options, one could be, as you mentioned, technology related, where we're looking for a particular piece of technology that we think will be important in the future and one could be for customer or market access, to access new customers or markets. So those are the kind of three categories that we think about it in. But yes, it's something that we are actively looking at in parallel.

Thanks, guys.

And your last question comes from the line of Hans Mosesmann from Rosenblatt. Your line is open.

Hey, Jim. If you look at Avant as a mid-tier FPGA offering, can we expect those products to address both control plane and data plane type applications or sockets?

Yes. Good question, Hans, and the answer is definitely yes. It would address both. Yes. Whereas today, our products are mostly control plane applications. Avant would open up not just control plane applications but data plane applications as well.

What would the mix look like over time? If you can estimate that?

Yes, good question. I think we'll probably talk about that as we get closer to the Avant launch because when we get to the Avant launch, we'll talk about the features, the capabilities, the surety, speed, the communication speeds, et cetera. And then it will be easier to explain where we see the potential in terms of both control and data plane.

Excellent. Thanks a lot.

And that concludes our question-and-answer session. I will now turn the call back to Lattice's CEO, Mr. Jim Anderson, for closing remarks.

All right. Thank you, operator and thanks, everybody, for joining us on the call today. We're pleased with our revenue and profit growth in Q3 as we continue to execute to our strategy and expand our product portfolio and we look forward to providing more updates at our next earnings call. Operator, that concludes today's call.

And that concludes today's conference call. Thank you for participating. You may now disconnect.