Earlier today, MPS released a written commentary on our results of operations for the first quarter ended March 31st, 2026. This document can be found on our website.

Before we begin, I would like to remind everyone that in the course of today's presentation, we may make forward-looking statements and projections within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risk and uncertainties. The risks, uncertainties, and other factors that could cause actual results to differ from these forward-looking statements are identified in the safe harbor statements contained in the Q1 2026 earnings commentary and in our SEC filings, including our Form 10-K and Forms 10-Q, which can be found on our website.

Our statements are made as of today, and we assume no obligation to update this information. Now, I would like to turn the call over to Tony.

Thanks, Arthur. Good afternoon, and welcome to our Q1 2026 earnings call.

In Q1, MPS achieved record quarterly revenue of $804 million, 7% higher than the fourth quarter of 2025 and 26% higher than the first quarter of 2025. Our quarterly performance was a result of our continued innovation, our consistent execution, and the resilience of our diversified market strategy.

Let me call out a few highlights from the quarter. Our communications end market grew 33% sequentially on the strength of our power solutions for optical modules and switches.

The pipeline for our automotive and enterprise data end markets, including server, continued to accelerate as we won multiple new projects across customers and regions. We sampled our first high-speed interface products for DDR5 at major customers, and MPS continued to grow our capacity past our original $4 billion plan with a new goal of reaching $6 billion in the near future.

We continued to adjust to the fluid geopolitical and macroeconomic environment, but our diversified market strategy remains unchanged. MPS focuses on innovation and solving our customers' most challenging problems.

We consistently invest in new technologies that open new end markets and applications and accelerate our transition from chips only to a full-service silicon-based solution provider. Finally, we continue to expand and diversify our global supply chain, allowing us to capture future growth opportunities, maintain supply stability, and rapidly adapt to market changes as they occur.

Operator, you may now open the webinar for questions.

Hi, guys. Thanks for letting me ask a question.

I just wanted to dig a little bit into the enterprise data side of things. Can you just talk about the different trends you're seeing between kind of the XPU side versus the server CPU side?

I know you mentioned in your preamble that the backlog and visibility was improving in both, but given the strength of demand we're hearing elsewhere in the server CPU side of things, I wondered how you guys are doing there.

Both are good. [laughs] Yeah, maybe Tony you can talk about it.

I'll give a little more color. Ross, if you recall, even last year in 2025, we had talked about CPU being a tailwind.

We continue to see that here in 2026. If you look across enterprise data, for us, right, as we've said, it's increasingly hard to differentiate between sort of AI solutions and CPU.

In general, all the growth drivers are intact. We're ramping new customers.

We've been ramping existing customers. We continue to see the transition to modules.

Like I said, plain server has been a tailwind, and we think it will continue to be so.

Thanks for that. I guess the second question will be on the storage and computing side of things that seemed to be a little bit better than feared in the first quarter.

Talk about the tailwinds or headwinds given what's happening from a macro perspective and then potentially the difference between what you guys do on the storage side versus the computing side.

I'll start on that one, and then I'll let Michael and Rob jump in. As right, that segment really has sort of two separate businesses in it.

The storage side obviously has remained strong as it's really been indexed to a lot of the data center business. We've seen strength in DDR5.

We've seen strength in HDD and SSD continue out of last year and into Q1. On the notebook side, we're still more cautious on that side.

As there's really two dynamics there. I'm sure you've heard other companies talk about potential TAM headwinds associated with memory shortages or elasticity from memory prices.

Remember, we also selectively play in that part of the market that has lower margins around consumer. I think as we look forward on that business going through the year, I think we're still very optimistic about storage staying strong, probably much more cautious on the notebook side.

Thank you.

We don't really care this quarter or next quarter as long as we develop the best solutions, our power densities, and our customers' ease of use, and these are design win that we have. The revenue will ramp.

All right, operator, next question?

Great. First, I'd like to ask about manufacturing.

You noted in the press release that you passed the $4 billion target, you're now working to $6 billion capacity. Maybe you can update us as to the strategy around geographic placement of your capacity and maybe remind us what's going on from a technology perspective.

This used to be a big focus, the various BCD iterations that you produce. Can you bring us up to speed as to what is the latest BCD generation?

Thank you.

I answer your last questions at the first. We are still around the 60 nanometers, and maybe we'll go down to 40 40 45 nanometers.

As a market trend, the power increase, and we increase power densities. It's just old stories.

We keep doing the same things in the last 20 years. We just do better than our competitors.

For the $6 billion goal for manufacturing pipelines, we see our near futures. We see a lot more activity, a lot more potentials, and all these design win is imminent.

They will turn into revenues.

Maybe just to add, Will, I think I'm telling what but on the $4 billion capacity, we talked about that being very geographically diverse, both inside and outside of China. Remember, our strategy really is to maintain that supply chain diversity, we'll continue to try to have that balance going forward.

Hey, guys. Thank you for taking my question and congrats on the results.

Maybe just to start, can you just help us a little bit with the models, any help you can give us on the guidance by segment as we think about the sort of a 12% sequential growth for the June quarter, which segment should be above and below? Thank you.

I think let me start with you guys are more interested the most, okay? Bernie, last times and okay, talk to you guys we'll have a 50% floor, okay, 50% floor, okay, I let Tony talk about it and give you a better news today, okay?

I'm more excited about the other projects that I deeply involved, okay, meaning the building automations and audio project side and as well as robotics. These ones, I will pave the way for our next 2 to 3 years out, and okay, the remained on the same growth trajectory.

I'll follow up a little bit as kind of marching through. Josh, I know the first thing people are interested in is enterprise data, I'll start there.

As you recall, we tend to be fairly conservative how we look at these things, waiting for the backlog to be in place. Late last year, we talked about 30% to 40% growth year-over-year.

In the last call, we kind of rose that to a 50% floor. The strong ordering patterns that we saw start last year have kind of continued through Q1.

At this point in time, I think we're comfortable raising that floor up to around 85% year-over-year growth. That will certainly be one of the drivers of growth for the year for MPS.

I

let Tony deliver [laughs] better than [laughs] of our last CFO, okay.

If you look at the others, Josh, I think we've been signaling on communication as we become increasingly excited about that end market with not only the optical module growth, but due to switches as well. We certainly would expect those to be drivers.

Auto, I think is a very consistent story. We've said that would be roughly flat through the first half of the year and ramping in later in the year.

Then storage and compute, we talked about it a bit already with Ross, right? There's really two different dynamics going in there where we're still very optimistic on storage pulled through by data center, more cautious on notebook.

Here again, overall, we cannot predict which quarter goes ramp what volumes. That's not our business to do that.

Our winning strategy is same in the last 20 years. As long as we deliver the best product and solving our problem for our customers.

I don't see we lose any socket, okay, at the major socket at least, okay. We keep winning.

Those design win will turn into revenues.

Thank you both for all the color there. Unfortunately, when you deliver good news, you still get annoying follow-up questions.

I guess if we think about the incremental upside since last quarter, any help you can give us on how much of that's coming from CPUs as Ross mentioned earlier versus more confidence into either content or visibility into share on the AI accelerator side? Thank you both, and congratulations again.

That's a good try, okay? Now, I'm not going to give it to you, okay?

[laughs] Josh, I think we'll just fall back and when we've talked about all the growth drivers and say they're intact. I don't think we want to try to parse out between volume and content, because it can be very specific.

In reality, okay, it's very difficult, okay, to separate it, okay? What is called AI?

What is called servers, okay? There's a lot of agents, okay, in a small segment, okay, and these are small utility box, okay?

We see a lot of happening, okay, and maybe I don't use the right words and you guys use it, okay, and these are portable AI devices, okay, and just based on GPUs. These are happening.

That's clearly overlapped with the CPU and GPU-powered. Hey, can't

hurt to try. Thank you, guys.

Okay.

thanks, guys, and I'll add my congratulations. Just a wow, I guess, on the outlook.

Maybe if I could just for a second talk about enterprise data. I've got a follow-up for Michael that you'll like better, I think.

The top four CSPs, I think just last night, now we're over $700 billion in CapEx just from them. Seems like you guys are clearly seeing that increased order velocity.

My real question is, are you able to capture all of that upside? Is there anything curbing your supply or your ability to capitalize, Michael?

Because in years past, MPS has kind of made your bones on always being ready for that upside and kind of never being caught short. Just kind of curious if that's still the case or kind of what you're seeing.

I think it's exactly right, okay, although we have a few more players, okay, and let me go back a few quarters ago, okay, and in these AIs, okay, and GPU powers. Given times will be the performance and also the manufacturing capabilities and the reliability will as only a few players.

After a year, couple years, it's being very clear so MPS is the one of a players. As I promised over a year ago or so.

We continue to do well, okay, in many aspects, okay, especially for the power density side. We are the best in the market segment because we provide a total monolithic power solutions.

We can use a single piece of silicons versus our competitor use a multiple piece of silicons. That clearly shows our advantage.

Yet, we don't want to be the dominant suppliers, okay, we just want to be a part of it. Our goal is a diversified growth.

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Got it. For my follow-up, Michael, I'm just curious on physical AI.

Obviously, it's getting a lot more people talking about it and until a lot more focused. I'm just curious if you could flesh out maybe a little more your plans for that segment.

What kind of TAM have you guys identified there? You called out robotics a minute ago on the call.

Can that be a meaningful revenue contributor next year, or when would we start to see robotics start to drive top line?

We see this year and but the volume still low, but it kind of move the needle slightly. If we go up the trends, okay, this is still at the very beginning.

It's very difficult to predict, okay. Many companies launched the first high-volume robotics, okay, though we clearly benefited from it.

After that, we cannot call the market segment growth, but the future is there, okay. Clearly, when more AI adopted in robotics, the application will be widened.

I think what you see is us try to run the typical MPS playbook, which right now we're trying to engage broadly and win all the designs we can. We can't control when the customers ramp, but we can control winning the sockets.

That's the broad engagement you really see happening in 2026.

That's very good point. Yep.

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Great. Thanks, guys.

Hey, guys. I'll offer my congratulations as well on the results and outlook.

Michael, Tony, I guess I wanted to ask on the com segment. It was up 33% sequentially in March.

It sounds like it's going to be one of the faster growing segments in the June quarter. When I look at optical modules, I think 800 gig modules are more than doubling in '26, my question is, do you think that com segment could actually grow as fast, if not faster, than enterprise data this year given those trends?

Again, I follow Tony's answer for the last one, we're not in the business to predicting what the market trend is, okay? We provide these happens, okay, and in this particular segments.

We saw a lot of activities and a lot of demand for high power density product and especially modules. I think as I mentioned about maybe a few quarters ago, and so this quarters it's just jumps out.

From what we learned, the power density of the module with a very confined area, and the data rate keep increasing it, and with optics or with other type of format, okay, the power will keep increasing, okay. In what rate, I cannot predict, but in a small confined areas, and the power density is critical.

That's our basic technologies and that we can apply in that segment, and then we execute fast and then we capture the market.

I think as ordering patterns have continued to be strong and extend, we still don't have them all the way through the year, I think it's pretty tough for us to call all the way through the back half right now, but certainly we'd put that end market above the corporate average.

Got it. Okay.

In the same way, I'll go back to servers, okay, and go back to the server side, okay. In the last years, we don't know, okay, and the server market will pick it up or not picking up, okay.

As far as we listen to our customers, we get our inventory ready, okay, and when they need it, they have those products. We just focus on deliver better product, winning more socket.

I'm a broken record, but I think it's a great example of, again, diversified approach. You land, and you sort of look at the other sockets available to an application and continue to grow your SAM.

Okay.

Great. My follow-up question, Michael, you guys have been sampling your products for 800 or plus minus 400 volts for a few quarters now.

Wondering if you could provide any feedback on how that activity is going and can you give us any thoughts on there's a lot of debate between whether those higher power conversion steps will be more GaN-based or silicon carbide-based. If it goes GaN, will you guys have GaN-based solutions ready for that opportunity?

No, we based on silicon carbide, and that's our solutions. In the past, I openly said I don't believe GaN, okay.

Now, I didn't know what I was talking about, I guess, okay. We started last year, we develop our GaN, but it's not for 800 volts.

It's for low voltage and lower power segments. We start to develop these fundamental technologies and in GaN.

To answer your first part of questions, yes, we sampling, okay, co-develop that systems with our customers, okay, and also our customers' customers. We don't talk about those until I guess you guys ask for it, okay.

And 800 volts became household names on the Wall Street, okay, and so we start to talk about it. Our product is working, and I think the overall environment and in the new 800 volts power bus data centers, a lot of things has to be resolved.

For that application is ready, okay, and also have 800 volts, okay, go to a 10,000 volts, okay, that's another segment. Has to be develop a lot more efficient power conversions.

These are all part of the pictures. MPS will play in those segments.

Yes, thanks. Michael, Tony, and congrats on another record quarter.

I had a question maybe as a follow-up to a previous question on power. I do realize there's a lot of focus on 800 volt, but before we get there, there's the move to 2,000 or two to 2,000 watt GPUs.

I know there's a lot of sort of wannabe power management companies out there, Michael. Just hoping you could touch on two or the three things that really make MPS so unique and differentiated to handle those types of power levels, cuz that is not like a 2028 timeframe.

That's already next year. If you could give some color there, that'd be great.

That's a good questions. I can touch and one of them I already said earlier so that MPS is focus on the monolithics.

We do what is the most cost-effective and we do and how we do the integrations. We have the capabilities like to integrate or discrete disintegrate, okay, and the integrations and we we can put it in in a one modules.

That's a huge advantage. With the multiple other chips, okay, and if we use a particularly discrete power components, okay, discrete power power FETs, and it's very difficult to do for manufacturing the modules.

The the second things I should mention that and that we invested in a module development unit for other segments actually in since 2000 2016, we want to move move up, okay, from providing silicon only power conversions, okay, we do a plug-and-play solution. That journey we started 2016.

Immediately, we know how we test these these devices and how we qualify these devices, okay, not and if it's a high volumes and a high qualities, okay, can't be touched by humans. We we develop our own test systems and own reliability systems.

These are fully automated. They're all actually, it's all based on MPS motion product.

These ones are very unique. They before these these systems put in in productions, we can't find anything like these on the on the market.

That's I think it's to to me this is a huge advantage. The other one is the last one is I'll go back to semiconductors, okay.

We we as we talked about us we use a 60 nanometers, okay, and we now we're moving to a 40 nanometers. Those are increased the power density by last time we talk about a three 3 amps per per millimeter cubed, and now we go past that.

Great. Thank you for that, Michael.

As my follow-up, when you mention a new product, I always listen to you because I remember you talked about 800 gig optical components being a new market, and before you knew it, you had a huge business there. You now mentioned you have your first high-speed interface product sampling for DDR5.

Just curious when should we start to see material revenue from that business, and could that also grow into several hundred million dollar business over the next few years? Thank you.

That's absolutely right, okay? Frankly, I don't know anything about this high speed.

[laughs] And we just hire some best engineers and cut them loose, and then they created these, okay? [laughs] And but from a business side is our natural way of expanding the total service market segment the increase our SAM.

We have a pretty good positions in PMIC in memory, then we introduce timer and timing drivers, okay, and a timing control, whatever, and okay, and also temperature sensors. Now these RCD or whatever the things, okay, and I know it's a very difficult, it is beyond my understanding, our engineers, okay, and our peoples, and they pull it off.

We have a few peoples, and compared other company they have a 50 peoples, okay, all that design groups, okay, and we will be able to pull it off in a few years. These are brilliant guys, okay, and they want to make things happened.

The revenue, usually we don't talk about it, okay, and talk about a product, okay, and we sample those product are clearly in that market segment, our customers very much welcome we have another player.

Tore, I'll just help you with the model a little bit. I wouldn't really have that as being a contributor to 2026 revenue.

I think we're really highlighting it as we continue to expand our footprint in that market.

That's fair. Thank you again, and congrats.

Thank you.

Hi, guys. Let me also extend my congratulations.

I'm curious about the coms business. That definitely is a standout for the quarter in terms of growth, upside, and I presume carrying through into the second quarter and for the balance of the year as you previewed already.

What I'm most curious about is how much content you have in these 800 gig optical modules and I assume maybe Top of Rack switches. Maybe if you can put it in the context of by how much you see your content increasing in rack-scale solutions for accelerated compute, given this beachhead in these two new applications.

I think it's more than a beachhead now, okay, we're pretty pretty well in the in in the in the be- okay well beyond the beachhead now, okay, and Tony, you want it?

I think we're going to stop short of kind of giving a dollar content. Obviously in the optical modules, right, we have a module in the module doing that, we obviously look at more of that than a discrete device.

If you talk about switches and things of that sort, you have a whole different number of trays, for example. You have switches, you have NIC cards, you have other things like that, which all require power.

I think the opportunity is, right, you have a number of different processors that sit in these racks that we can provide power for and that we've been expanding that all sit within our communication segment. I think as usual, right, we're not going to talk about specific content layers, especially for specific customers.

Okay. As my follow-up, I wanted to ask about distribution channel inventory.

I know it's been running lean. Is it still lean relative to where you would normally place your distribution inventory?

Then as well maybe if you can talk about the sort of inflationary relating pricing trends that you have to pass along?

I'll take that one. With regards to our distribution channel, we don't have a great deal of perfect visibility there, but what we have seen at least in 2025 and carrying into 2026 is that the channel has been very lean.

That implies to us that we're shipping to what demand is at the end market. Beyond that, we're looking good.

Okay. Pricing?

For the pricing, okay, cost the pricing, okay, yeah, that some of the costs is higher, okay, and we see a lot of activities, okay. The goal is that we keeping our margin profile.

I think and just to add to Michael, I think we're not looking at it as a broad-based across-the-board. There are places where input costs have gotten higher.

People are asking for expedited supply chains and things of that sort. In those cases, yeah, you could see us raise prices to stay within our gross margin model.

Thank you.

Thanks for taking the question. Maybe just a follow-up there on the gross margin.

Wondering if you could just share any of the puts and takes on the guide. It just feels like obviously very positive revenue acceleration and kind of not a ton of follow-through on gross margin, kind of still staying in that range.

I again, I said the margins in the last couple of quarters, margins on the low end. Although it's in our models, okay, meaning it's on the low end.

We still want to improve the yields and on the modules. I think that we don't have much of a headwinds, okay, we're moving up.

I won't give you a false hope that we're going to jump very high soon, okay, that's not MPS. We don't do that kind of things, okay.

To expand a little bit on what Michael just said, historically, we've been very consistent with delivering to our gross margin guide. For the last four quarters, we've been flat at 55.5%, which is at the low end of our gross margin model for growth, which ranges from 55 mid-50s to upper-50s.

For Q2, as you noticed, we did have the confidence to increase incrementally our gross margins, mainly because we've gotten better visibility to our backlog. We saw this happening in the fourth quarter of last year and it's continued into the first quarter of this year.

That has again given us some confidence. We do, however, do see some strong headwinds potentially in the second half, and so we're remaining cautious for the guide in the second half of the year.

Got it. That's helpful.

Maybe just on the robotics socket opportunities you talked about up for grabs or to win this year, do we think about those as being incremental? I think you talked about $150 of content per humanoid back at the Analyst Day.

Is that the right way to think about it, or are those expanding opportunities?

It really varies, okay, and humanoid is the most visible. You will see some dancing robots, okay, and what we focus on in robotics, if it's a remote and without a power cord plugging the robot, okay, and those have the battery operations.

Our battery management product plays a role in there. The other one is the AI side, the compute side, okay, for power up the GPUs, okay, and these are autonomous control units, okay, and as well as these sensors.

The other segment is the actuators, the motion side. That's the overall we offer for the robotics companies.

Many applications, and in actuators, and they can be in a medical assist for rehab purposes, okay, we see those kind of things happening. For the dollar content, go back to your dollar content, it's very difficult to say, okay, it's a variety of applications.

We selling chip to selling modules, okay, and so the dollar content is also different. It's very difficult to judge.

The trend is these robot will happen. The world will be a lot more automated and it can assist human to do a lot of things, okay.

Thank you.

Yes, thank you. Good evening.

I guess the first question would be about the ED segment. If you could talk about the growth on merchant solutions versus ASIC solutions this year and what you're expecting with regard to content.

I know you've got a strong position in both, but do you expect outsized growth in one area than the other? Any color you could provide would be helpful.

Thank you.

We don't divided into the learning side and inferencing side, okay, and frankly, we don't know how to separate it. Because we use the same similar product.

Why we winning all these segment is because the power density, as I said earlier, okay. Nobody want to waste of power, and power density is directly related to power efficiency.

They want a smaller size, and they want to have a high efficiency. It really doesn't matter to us which segment.

Chris, the only thing I'd add, right, is I think as we're comfortable raising the floor from 50% to 85%, not because there's been a fundamental change in the growth drivers or how we're approaching the market, it's really our more comfort about what's in backlog, and we've seen that extended ordering pattern. I think to Michael's point, I don't think we subdivide at the content and volume, but I just want to make sure you know that I don't think anything's changed other than just damn receive more orders in the books going forward.

Got it. Thanks.

As a follow-up, if I could ask about the auto segment, and you talked about that being flattish in the first half with some growth in the second half. Obviously auto's been a little more variable in terms of its recovery.

There was some data out of China which was a little weaker in the beginning of the year. Perhaps you could give some color on the visibility you have in auto and why you think that starts to grow again in the second half?

I don't pay attention to which segment is the strong, which continent it's more strong or weaker, okay, because these are chasing the market. We're not chasing the market.

Whatever happens happens, okay. We have the product ready.

We can deliver. Tony, you can talk about the near term, okay, I don't pay any attention to it.

I can add a little bit more there. I think, Chris, the shape of the year, as you said, right, our expectation there hasn't necessarily changed.

Why we talked about seeing that ramp later in the year is really on our belief in some of these designs that we previously won coming to market. We can't control when our customers ramp, but the pipeline in auto has been expanding, and based on our current belief, we would expect to see that ramp later in the year.

Again, as always, right, we'll monitor as things go through, but that's our belief at the moment.

Thanks.

The bottom line is we winning socket and we expanding our market shares.

Hi, Mike and Tony. Congrats on the results.

Could you talk about the rationale behind focusing on silicon carbide for 800 volt step-down while focus on GaN just for the lower voltage lower power segments? It seems that some of your peers are also using GaN for higher voltage step-down.

How would that influence your competitive positioning?

Oh yeah, it's a long questions. It's a long answer.

Starting, okay, I said I didn't believe GaN, okay, and I still don't believe, okay, for high powers, okay, and we still have to prove that in the market segment. The reason we use silicon carbide, these devices are proven, okay, in the history like a 20 years ago, okay, they making a diodes, okay, the materials are a lot more reliables, okay, and there's some fundamental issues, okay.

We started this try to improve start at 2016. As a result, we have a deep know-how and to use these silicon carbides, okay.

The MPS is unlike other company, we don't sell silicon carbide FETs. These are passive semiconductor pass-through device.

We always integrate into our modules. That's a kind of short story for you, okay.

Thank you. Got it.

I know that the team historically has been able to gain share in tight supply environments. Could you talk more about your supply chain management strategy and also your confidence in meeting customer demand if other suppliers face capacity constraints?

Throughout history, if you look at it, and especially during 2021, these are after COVID, okay, it happens, okay, and MPS always listen to our customers. We don't play a passive role.

When the customers tell you to pull in, too late, okay. We have actively preemptively to build these inventory, get these inventory ready.

Our product life cycle is very long, we don't have any materials, okay, large amount of and scrapping, and we know these one sooner or later will sell. Again, you ask me when these product ramping, I don't know, plus nine plus minus a year, it will sell.

We don't mind have a little high inventory, although in the last recent quarters, we cannot have enough to build up.

I just think the last thing I'd add, just so it's really clear, is nothing about our outlook or anything we've said about enterprise data floor is because we see any constraints in the supply chain. It's something we've continuously stayed ahead of, if the root of your question, Kelsey, was whether or not the 85% floor was limited by something, that's not an issue right now.

Got it. Thank you.

Yep.

Thank you, operator, and thank you all for joining us on this conference call today. I look forward to speaking with you on our next call for our second quarter 2026 results.

Thanks, and have a great day.