Bryan Murray, CFO of NETGEAR, added, "We expect to continue to experience strong underlying demand in the SMB business and the premium portion of our CHP product portfolio. However, on the retail portion of CHP we expect a normal seasonal decline coming off the holiday period, and we will continue to work with our retail channel partners to optimize their inventory levels. This should lead to improving results in CHP retail as we progress through the year. Given the strong performance in the fourth quarter, which allowed our service provider customers to improve their supply positions, we expect first quarter revenue from the service provider channel to decrease to approximately $25 million. Given these factors we expect our first quarter net revenue to be in the range of $185 million to $200 million. We expect the SMB business to continue to see improving supply which should allow us to lower our reliance on higher-cost air freight spend. This will offset the impact of reduced topline leverage relative to our recently completed fourth quarter. Accordingly, our GAAP operating margin for the first quarter is expected to be in the range of (4.7)% to (3.7)%, and non-GAAP operating margin is expected to be in the range of (2.0)% to (1.0)%. Our GAAP tax rate is expected to be approximately 30.0%, and our non-GAAP tax rate is expected to be 5.0% for the first quarter of 2023."
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