Good day, everyone, and welcome to the Synaptics Fourth Quarter 2015 Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Alex Wellins from The Blueshirt Group. Please go ahead, sir.

Good afternoon and thank you for joining us today on Synaptics fourth quarter and fiscal 2015 conference call. This call is also being broadcast live over the web and can be accessed from the Investor Relations section of the company's website, at synaptics.com. With me on today's call are Rick Bergman, President and CEO, and Wajid Ali, the company's Chief Financial Officer. In addition to the company's GAAP results, management will also provide supplementary results on a non-GAAP basis, which excludes share-based compensation charges and certain non-cash or non-recurring items. Please refer to the press release issued after market close today for a detailed reconciliation of GAAP and non-GAAP results. Additionally, we'd like to remind you that during the course of this conference call, Synaptics will make forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. Although Synaptics believes our estimates and assumptions to be reasonable, they are subject to a number of risks and uncertainties beyond our control and may prove to be inaccurate. Synaptics cautions that actual results may differ materially from any future performance suggested in the company's forward-looking statements. We refer you to the company's current and periodic reports filed with the SEC, including the Synaptics Form 10-K for the fiscal year ended June 30, 2014, for important risk factors that could cause actual results to differ materially from those contained in any forward-looking statements. Synaptics expressly disclaims any obligation to update this forward-looking information. With that said, I'll turn the call over to Rick Bergman. Rick? Richard A. Bergman - President, Chief Executive Officer & Director: Thanks, Alex, and I'd like to welcome everyone to today's call. I'm really excited today to reflect back on fiscal 2015 – the year…

Thank you, gentlemen. [Operating Instructions] And our first question will come from Paul Coster of JPMorgan.

Yes. Thank you very much for taking my questions. I've got really two. The first one is, you talk of the fiscal year 2016 being back-end loaded, and I also got the sense, Rick, that it's going to be primarily focused on TDDI. Judging by your extreme – your extremely statement. Can you confirm that? And related to that, whether we should see this being very broad-based adoption or is it really concentrated in a handful of customers? Richard A. Bergman - President, Chief Executive Officer & Director: Okay. Thank you, Paul, for the question. So maybe try to clarify where we see our opportunities, is what you're getting at, as we move through the fiscal year. In a couple of product areas, we've been investing in and will continue to invest heavily in development, because we see the growth prospects being quite strong. And that's in our biometric or fingerprint area, and then secondly as you mentioned, in TDDI. Those are – continue to be our two pillars of growth. And as we go through the course of the year, we expect those to start handling the load of the growth as well. Frankly, we also continue to see opportunities to continue to grow the DDIC business. Now there's seasonality and other things there that can impact that in certain customer ramps. But, overall, even with the growth of TDDI, we kind of see that as another opportunity. There's obviously trade-off between the DDIC and the TDDI. In terms of our customer base, we're pretty broadly deployed across the customer base as is, and we would expect that to continue. During my prepared remarks, you heard me rattle off a number of the growing China OEMs. And our success there continues to grow substantially with some great sequential, as well year-over-year growth that we've had with those customers. So the short answer there is, we expect broad growth across a number of customers.

Okay. My follow-up question, for Wajid, I just want to make sure, the 20% to 25% growth includes some non-organic growth in the first quarter still, from not quite lapping the RSP acquisition, is that correct? Wajid Ali - Chief Financial Officer & Senior Vice President: Paul, that's correct.

Okay. Thank you.

And our next question will come from Vijay Rakesh of Mizuho.

Yes, guys. Thanks. So just looking at the guidance here, this is the first time we have RSP broken out, I guess. So when you look at the RSP seasonality, do they usually have a stronger December quarter and a September quarter that's more like flattish or back-end loaded, is that how the seasonality in RSP usually looks? Richard A. Bergman - President, Chief Executive Officer & Director: Well, we didn't spend a lot of time examining RSPs history because this is obviously Synaptics and a lot going on going forward. So I think if you talk broadly, DDIC companies historically have – do have a stronger second half calendar year than first half. Now Synaptics, for those that have followed us, and I look back on this the last three years, we've had a much stronger calendar first half than second half, or in other words, our fiscal year is back-end loaded, by a nontrivial amount of 20%-plus over the last three years, each of those years. Now there were acquisitions in there that helped fuel some of that, but nevertheless, it's those two trends, you could argue, fighting against each other. Now, when you start playing in specific OEMs, certain products and so on, we try to capture all those in our guidance for Q1, as well as our fiscal year guidance.

Got it. And the 20% to 25% guide year-on-year, how comfortable are you with that guide, especially as you look out into first half next year, when you look at the touch side of the fingerprint sensors side or display integration. If you can give us some more color on the confidence there. Thanks. Richard A. Bergman - President, Chief Executive Officer & Director: Well, again, you have to look at our track record. And as I mentioned in my remarks, after the acquisition of RSP, we re-guided, because basically everything changed here at Synaptics with a major product line coming in and helping us or disrupting some other things. And we gave guidance of 75% and we ended up doing a little bit better at 80%, and prior years, I think would show a similar trend. That being said, again, we roll up all those factors and felt comfortable that 20% to 25% is the right range to provide to the analysts and investor community going forward. As we talked about in prior calls, this is the season of design wins. And so, some we got locked down now. Some are still open. Our product portfolio is just great, whether it's our biometrics, DDIC, TDDI and so on. But some of those designs still have to be locked down, so we have to kind of weigh where we are competitively and where our products are. And I feel good that our competitive position is strong across our product lineup.

Got it. Great. Thanks.

And our next question will come from Rob Stone of Cowen and Company. Rob W. Stone - Cowen & Co. LLC: Hi, guys. Thanks for taking my question. I wanted to ask about fingerprints, in the quarter you just reported, Rick and Wajid. Can you give us any color on whether that mix in revenue has increased? And are you seeing – what kind of shift, is it all touch versus swipe at this point? And then, related to that, how are you seeing the uptake of fingerprint applications within desktop PCs based on the comments you had about new peripheral products? And then I do have a follow-up. Thanks. Richard A. Bergman - President, Chief Executive Officer & Director: Okay. I'll take a crack at it and then if Wajid wants to add anything to it. So I'll take the more general question around, well, what trends are we seeing in fingerprint adoption? So, of course, last year, it was primarily a premium – used in premium solutions. Whether it's Samsung or Apple, we tended to be the higher segment, the high-end of the smartphone marketplace. The big trend is now we're now seeing mid-range adoption. And I mentioned one, the A8 from Samsung. It's a great looking phone. It's a 5.7-inch phone. So maybe it's more of the higher end of the mid-range. But nevertheless, they're selling it in India and China, and I think it will get strong adoption there. And it, of course, uses our fingerprint solution, and it is a touch solution. So we're seeing a strong movement towards touch versus swipe. And I also had mentioned that the Sharp design, for certain reasons, they thought swipe would work better. Some of the performance on that in terms of security is quite high. And that…

Up next, we have Ambrish Srivastava of BMO.

Hi, thank you, Rick and Wajid. On top of the call, Rick, you talked about the moderating growth. But I just wanted to revisit the full year guide, and I'm sure you have visibility into your design wins and their ramping, but what's embedded in the end-market growth assumptions when you look out for the fiscal year? And then a quick follow-up on the fiscal year is, how should we be thinking about gross margin and OpEx? Thank you. Richard A. Bergman - President, Chief Executive Officer & Director: Okay. I'll take the first half and then let Wajid take the second half. So, just to kind of give you how we're rolling into the fiscal year; it was in our comments, but just to reiterate. We see from Q4 to Q1, and Wajid just mentioned this as well, growth in our, call it classic core markets, the touch and the fingerprint business growing sequentially. And for us that's great news, because if you look back last year actually sequentially, we had – in those same businesses – we had a minus 10% sequential growth. So that trend is clearly heading in the right direction. A lot of that is based on some investments that we've made obviously in fingerprint and some of the touch solutions, display integrated solutions, specifically. So we're excited about getting that back on a growth path. As we look over the fiscal year, again we're not going to guide Q2 through Q3 and Q4 individually. But we think we can build on that success and then get those other pillars of growth going in a faster pace – the fingerprint and TDDI – to really fuel that 20% to 25% growth. And then, in terms of the gross margin and OpEx, I'll let Wajid comment. Wajid Ali - Chief Financial Officer & Senior Vice President: Hi, Ambrish. So, in terms of gross margins, we're expecting to see gross margins modulate between 37% and 40%. We've presented that as part of our operating model and we continue to expect to see all of our core product lines fall into a mix that would give us that level of confidence around that. Our OpEx will really modulate so that we achieve our operating margins of 15% or better. We've talked about having operating margins in the mid to high teens and so we'll be modulating our operating expenses so that we achieve that.

Okay. Great, thanks, gentleman.

Your next question will come from Rajvindra Gill of Needham & Co. Rajvindra S. Gill - Needham & Co. LLC: Yeah. Thanks for taking my questions. On the sequential guide, you gave some clarity on the fingerprint and touch being up, which is different from last year. But that would imply obviously that TDDI, the DDI stuff, is going to be down subsequently. And I'm just trying to get a sense of that for September, given the fact that there will be, I would think, a new phone ramping in the fall. So if you could provide some more color on the renaissance (33:51) business, some of the puts and takes in the September quarter? Richard A. Bergman - President, Chief Executive Officer & Director: Sure. Again I'll start out. First, to address one kind of the questions there. And TDDI, I think as we mentioned, it's great to be in volume production, but it's not a huge part of the Synpatics business at this point. So it's not really a major factor in terms of the growth. Specifically around DDIC, there's various product cycles and customer ramps and so on that impact that business. And some of those were favorable in our fiscal Q4 and in Q1, they're down. Now, down is a relative term. It's relatively a small decrease in the grand scheme of things, but it is a little bit lower than what we saw in Q4. And again, we depend on certain customer ramps, inventories, where we are in the BOM and so forth. And it's one of the reasons we talked about, as we go forward, we're investing in this area, as we wanted to continue to build the strength of the DDIC and TDDI product line. And we're in the process of doing it.…

And we'll now move on to Osten Bernardez of Cross Research.

Good afternoon. Thanks for taking my call. I was just trying to get a better handle on the fingerprint business, just following up on the last question and reconciling to prior comments in the past. Would you say sequentially – so June quarter versus March quarter – what type of growth did you see given the changes in the mix of the business? Because if you just kind of "doubled" for the full year, year-over-year, that implies a pretty significant decline quarter-over-quarter. So I'm just trying to get a sense of how we should be thinking about that. Wajid Ali - Chief Financial Officer & Senior Vice President: Could you actually just repeat your question? I'm a little bit... Richard A. Bergman - President, Chief Executive Officer & Director: It's Q4 versus Q3 was the growth in our fingerprint. Now, we don't break that out as a segment. But the general trend is... Wajid Ali - Chief Financial Officer & Senior Vice President: It's flat. Richard A. Bergman - President, Chief Executive Officer & Director: It's flat, as Q4 over Q3. So, yeah, I don't quite get the math how you're saying there's a substantial decline. Now, that clearly wasn't the case, and then we see further growth in Q1.

Okay. And then, just finally from me, just going forward, could you just sort of remind us or tell us whether there's a change in the thinking of the slope of the ASPs within the fingerprint business going forward, given you've talked about how the touch area sensor has – well, you're expecting it to have a sort of 2x premium or to be priced 2x sort of your slide sensors? And we understand that you've introduced other SKUs that could probably also help your overall ASPs, but how do we think about the slope of the touch area sensor ASPs, let's say, within your guidance, at least just for fiscal 2016 relative to the slope of ASPs for prior sensors? Richard A. Bergman - President, Chief Executive Officer & Director: I mean, so our prior guidance has been – because it's a new technology class and we enjoyed relatively high ASPs, especially in last fiscal year, that we would expect about a 15% to 20% ASP decline on any given solution. And then, of course, as we introduce new solutions, there's an opportunity to bump back up to a higher potential ASP. And we're seeing that play out, I would say, over the course of kind of calendar 2014 as well as calendar 2015. And then, we're in the midst of quoting a number of calendar 2016 business. So I would say we're keeping kind of with that 15% to 20% ASP decline.

Thank you very much.

And our next question will come from Charlie Anderson of Doherty & Company. Charlie L. Anderson - Dougherty & Co. LLC: Yeah. Thanks for taking my questions. I want to just sort of beat the dead horse, if you will, on the DDIC business down sequentially. Did you guys lose any content at any major customers or major smartphones and was there any sharing of content with anyone else? Just wondering if that's factoring in or if this is just pure – the customers and the seasonality that you're seeing? Richard A. Bergman - President, Chief Executive Officer & Director: No it's – Charlie, it's more the latter case. Seasonality and product ramps, inventory positions, those type of things. Charlie L. Anderson - Dougherty & Co. LLC: Okay, great. And then how about ASP? Did ASP play a part at all? Richard A. Bergman - President, Chief Executive Officer & Director: No, ASP is not a factor. Again, similar to the prior question, of course, any given resolution or type of product goes through ASP compression through the year. But in the smartphones it's a little easier to put your – or excuse me, in the display driver – it's a little easier to put your hands around typically the higher resolution parts as they're introduced get nice ASPs and then the older, of course, lower resolution parts get compressed over the years. So, I would say our ASPs, in general, are flat as we're introducing new stuff and the older stuff goes down. Charlie L. Anderson - Dougherty & Co. LLC: Great. And then last one for me. I know there's been kind of a lot written inter-quarter about your major customer in DDIC, will they change architecture, will they multi-source, will they take in-house? I know it's a…

And our next question will come from Liwen Zhang of Blaylock Beal Van.

Thank you for taking my question. Hi, Rick. You commented on the automotive area. Can you remind us the timeframe for Synpatics to have revenue contribution from that end market? Richard A. Bergman - President, Chief Executive Officer & Director: Yeah, that's a great question. Kind of ironically, it's now. So we haven't talked about it a lot, but actually with the RSP acquisition, we picked up a non-trivial amount of automotive DDIC business. And it's measured in many millions of units per year and the same thing on the revenue side. Now, is it 10% of Synpatics? No. It hasn't hit that level. I think what you're referencing is, well, what about, call it expanding in that family, touch pads, touch controllers and those sort of things? That's where we're winning designs. And I also earlier talked about how fast the smartphone manufacturers move versus notebook OEMs. Automobiles are an entirely different beast. So, those are more three to four-year cycle. So we've been fairly consistently saying it's a fiscal 2018 or calendar 2018 kind of timeframe. Clearly, there's some other areas like I just mentioned with the DDICs where we are having success much earlier. We have products that fit there and there's a few automobile manufacturers that will actually move a bit quicker than that. But where we expect it to make a decent size dent in our financial results, it's more in that 2018 timeframe.

Thank you. And another question about your fingerprint, I remember the fingerprint solution for Samsung Galaxy S6 had a little bit of an issue. You used a third-party, kind of cooperate with third party. So is this still be the case or you now are looking to print (46:58) solution all your own solutions? Richard A. Bergman - President, Chief Executive Officer & Director: So to my knowledge right now, there's three different external matchers that run on our fingerprint solution. And then we have our own. And very shortly, all four of those combinations will be used in the marketplace. So, our goal is to best support our customers with a complete solution. And whether it's our own matcher or third-party matcher, we're happy to do that. Our matcher has certain strengths in some areas; in other areas there's third-party software companies that have done a better job than us, or offer a different type of solution than we're able to offer. We simply can't address all of the opportunities out there with the team that we have. So, again, our goal is to provide the best total solution to our customer base. And we're doing that with a variety of different third-party matchers as well as our own.

Thank you. That's all I have.

And we'll hear next from John Vinh of Pacific Crest Securities.

Hi. Thanks for making my question. Hey, Rick, you said that you can expect to see a fingerprint design win from a top five OEM later this year, so that sounds pretty encouraging. But the pace of design wins outside of Samsung seems to be taking a little bit slower than expected to ramp. I know you've been talking about focusing on that major customer for quite some time. Can you talk a little bit about your design win visibility in the fingerprint space and when can we start to see a more meaningful pick-up in terms of design win traction outside of sampling going forward? Richard A. Bergman - President, Chief Executive Officer & Director: Sure. So just to clarify, my remark is you'll see top five China OEM be in mass production by the end of this quarter that we're in, not the end of the year. That was in your question. So it's not far away, I guess, is the message there. And that's what you should expect to see is continuing kind of cadence of additional design wins. Now, we're quite happy with our position at Samsung. As you well know, depending on how it's counted, they're shipping 75 to 80 million smartphones a quarter, which is still number one in the world. And it takes a lot of other guys to get to that volume. So we're thrilled to have them as a partner in the biometrics or fingerprint area and hope our success continues there.

Got it. And then my follow-up question is just on Force Touch. You talked about Force Touch earlier in the call. Can you talk about whether that's a discrete or an integrated solution into your existing touch controller and can you talk about what sort of premium you'd expect to get out of that solution? Richard A. Bergman - President, Chief Executive Officer & Director: Sure, John. Just like all of our solutions, we end up having a family of solutions, depending on the various OEMs and their vision on where they want to take the platform. As of now, it's an add-on feature for our touch controller devices. But you could expect that we'll have high-end solutions, display integrated solutions, TDDI type of solutions over time as Force could eventually become an important feature across smartphones as well as eventually notebooks. So, it tends to be – or what tends to happen – is it's our higher-end products, because it does involve a lot more calculations in math and additional channels and so on. So it's more of a premium to our ASP or, excuse me, let me restate. It's a higher-end product that gets leveraged and so it changes our product mix, effectively.

Great. Thank you.

And we'll hear next from Kevin Cassidy of Stifel. Kevin E. Cassidy - Stifel, Nicolaus & Co., Inc.: Yes. Thanks for taking my question. Your thoughts on gross margin modulating through the year between 37% and 40%. Can you give us what some of the moving parts would be for that? Wajid Ali - Chief Financial Officer & Senior Vice President: Yeah. Hi there, Kevin. Obviously, a lot of that has to do with product mix. We've talked about the range of our products, anywhere from TDDI and display driver products to fingerprint products, all having various level of gross margins across the band. So, although all of them have got different gross margins at a product level, we believe that the mix is going to be such that we're going to be able to modulate between 37% and 40%. If you take a look at our post-RSP transition, Q2, we were a little bit under that range, but kind of starting in our Q3 of fiscal 2015, we were able to start modulating kind of right in the middle of 37% to 39%. And in Q4, we guided the same and we achieved a performance right in the middle. And for Q1, we're seeing very much the same. And so, although our fingerprint and touch products are going to do a little bit better sequentially and our display driver business is going to be a little bit down, we're still expecting that type of range, even with our overall revenue levels coming down a tad bit subsequently. So we're feeling very comfortable with that range as a target. Kevin E. Cassidy - Stifel, Nicolaus & Co., Inc.: Okay. And just as TDDI goes into volume production, is that higher gross margin product than say the DDIC products? Wajid Ali - Chief Financial Officer & Senior Vice President: Yes, it is. Kevin E. Cassidy - Stifel, Nicolaus & Co., Inc.: Okay. So, I guess the long-term model, is that changing for gross margin? Wajid Ali - Chief Financial Officer & Senior Vice President: No, it isn't. It isn't. We've modeled that through and we've taken a look at various scenarios and we're feeling quite comfortable that we'll be able to meet that targeted range. And like I said earlier, what gives us confidence is that now we've got three quarters almost, two quarters behind us and one quarter ahead of us, of being able to achieve within that targeted range. So that's giving us a lot of comfort level around that. Kevin E. Cassidy - Stifel, Nicolaus & Co., Inc.: Okay, great. Thank you.

And we'll now move on to Anthony Stoss of Craig-Hallum.

Hey, guys, Rick and Wajid, if you wouldn't mind, gives us what percentage of your overall revenue is in China and also your view on, I guess, your customer base in China, if you think that will be, up, down, sequentially in September and just your view on what you see across the board from China. Thanks. Richard A. Bergman - President, Chief Executive Officer & Director: Okay, I'll let Wajid dig out the China revenue question. In terms of the marketplace, I think everybody in the industry, looking at results and input over the last few weeks, and there's clearly a lot of churn around, well, how strong is the China market going to be as we go through the second half of calendar 2015. And we're kind of in that same mode as well. In some ways it's good news, where last year Q2 was so strong, there was a bit of inventory build-up. We don't see that effect this year. So we think we're seeing good natural sell-through in the marketplace. And overall, I would say we see a pretty solid market. But we're playing it conservative at this juncture and expecting fairly modest growth rates in the China market. Wajid Ali - Chief Financial Officer & Senior Vice President: Yeah. Just at a percentage level of our overall mobile revenue, in Q4, we were in the upper teens from a revenue percentage standpoint for China mobile products and actually moving into Q1, we expect similar levels of mix from China mobile? Richard A. Bergman - President, Chief Executive Officer & Director: For those that have followed us, that's an uptick. We kind of said low to mid-teens over the past few quarters. So, as I said, we're seeing a nice overall bump there as we see our display integrated products take a more prominent role with the China OEMs.

And then the next, Rick, you mentioned Force Touch. I'm just curious if there's a call from any of your customers related to Force Touch for haptics and curious your view on haptics? Thanks. Richard A. Bergman - President, Chief Executive Officer & Director: So haptics is clearly linked with Force. And I think any implementation that you will see on Force, for the most part, will probably have some type of haptic response. And that can range from a variety of things, from just auditory to the actual, the physical vibration that you get in some solutions. So we'll see a range of haptic implementations going forward.

Thank you.

And it does appear we have no further questions at this time. I'll turn the conference over back to management for any additional or closing remarks. Richard A. Bergman - President, Chief Executive Officer & Director: Okay. Well, again,, thank you, everyone. We had a good, robust set of questions there. I appreciate it everyone getting in on the call today. And we look forward to talking to you in a few months. Thank you very much.