Lattice Semiconductor Corp The KeyBanc Technology Leadership Forum 2026

Thanks, John. Great to have you.

Yeah. I'm going to start with my best understanding, but I think I'll provide a little bit more color around the overall growth dynamic, which might actually be more helpful. At the beginning of the year, I think everybody in the industry was looking at industry expectations from about 15 million units for total servers. There was something about a 20% AI mix, and then it grew up to 16. Now, the latest past three weeks, we've seen the estimate for overall servers, about 20 million units, and with a higher AI mix to them. I would say that in parallel, as we've gone through the year, we've continued to see our demand going up and up and up. At first we were a little bit surprised and went back and tried to understand it.

What's really going on is, sure, AI servers are growing, but also just the more standard foundational CPU-based server infrastructure that is enabling this agentic workload being broadly deployed. At the highest level, both phenomenon, growth in the AI servers and in the more general purpose servers, it's very beneficial to us. We've historically been really strong and had a pervasive footprint in standard servers. As you know, and we've talked about many times, we have a really great opportunity in AI servers as you build out the racks with many more attach points for us, up to 100 attach points or even greater than that in an AI server rack because of the complexity.

When we looked at what's going on, and honestly, in real time, it's a challenge to parse those different drivers because our ship timing and the end customer ship timing don't necessarily align. What we saw is a really strong unit volume growth, in our products going to servers. That's driven by our attach rate is growing. As we've talked about, historically, let's say five, four years ago, it was 1.x, then it went to 2.x. Now it's 3.x, and it's now even higher. We've been providing higher value FPGAs into those opportunities. We've gone from our MachXO2, MachXO3, MachXO3D, MachXO5, and some Nexus parts as we are now seeing an expansion in our ASP from 3 to 4, and so on.

You have this multiplier effect for us, greater unit volume growth driven by higher attach rates as the complexity of the servers in both AI and general purpose applications grow and increasing ASP. So we've seen great growth. It's setting the foundation for future growth.

Great. I know I didn't only answer your question, but I thought you'd get there anyway.

What we've been looking at is our overall AI penetration, and some are on the data path, some are in the server domain. We don't do very much direct AI compute. That's grown into the high 20% of our overall business, which means it's a greater percent of the compute business. But again, we know where our design wins are. We know customers we're shipping to, how they're actually using the devices, not yet fully transparent to us. But in a way, it's like we'd like to know. More importantly, we want to ship all the units to them and drive the growth.

Great. I think actually back when it was a lower attach rate, it was primarily bridging, an I/O expansion type of applications. What we see then, we saw the security capabilities, including root of trust layer on. Then now we're beginning to see an expansion into manageability applications like power and cooling. Then the basis for our acquisition of AMI builds on that growing functionality that we've seen in the FPGA business and the broader application set that's available to us and their capabilities, which really augment us. We used to say we're first on, last off in a machine, and they're first on, last off right with us. Then they've layered on top of their boot capability, this management capability, and it meshes really, really well with how we see our FPGA application set growing. Right. Yeah, that's how the attach rate grows, and then that's the growth path that AMI had intrinsically.