應用材料 (AMAT) 2016 Q1 法說會逐字稿

Welcome to the Applied Materials earnings conference call.

歡迎參加應用材料公司財報電話會議。

(Operator Instructions)

（操作說明）

As a reminder, this conference is being recorded. I would now like to turn the conference over to Michael Sullivan, Vice President of Investor Relations. Please go ahead, sir.

再次提醒，本次會議正在錄影。現在我將把會議交給投資者關係副總裁邁克爾·沙利文先生。請繼續，先生。

Thank you. In a moment, we'll discuss the results for our first quarter, which ended on January 31. Joining me are Gary Dickerson, our President and CEO; and Bob Halliday, our Chief Financial Officer.

謝謝。稍後我們將討論截至1月31日的第一季業績。與我一同出席的有我們的總裁兼執行長 Gary Dickerson，以及我們的財務長 Bob Halliday。

Before we begin, let me remind you that today's call contains forward-looking statements, including Applied's current view of its industries, performance, products, share positions, profitability, and business outlook. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, and are not guarantees of future performance. Information concerning these risks and uncertainties is contained in Applied's most recent Form 10-K and 8-K filings with the SEC. All forward-looking statements are based on management's estimates, projections and assumptions as of February 18, 2016, and Applied assumes no obligation to update them.

在開始之前，請允許我提醒各位，今天的電話會議包含前瞻性陳述，包括應用材料公司目前對其所在行業、業績、產品、市場份額、盈利能力和業務前景的看法。這些聲明存在風險和不確定性，可能導致實際結果與此類聲明中明示或暗示的結果有重大差異，並且不構成對未來業績的保證。有關這些風險和不確定性的資訊包含在 Applied 向美國證券交易委員會提交的最新 10-K 表格和 8-K 表格文件中。所有前瞻性陳述均基於管理階層截至 2016 年 2 月 18 日的估計、預測和假設，Applied 公司不承擔更新這些陳述的義務。

Today's call also includes non-GAAP adjusted financial measures. Reconciliations to GAAP measures are contained in today's earnings press release and in our reconciliation slides, which are available on the investors page of our website at AppliedMaterials.com. Now I would like to turn the call over to Gary Dickerson.

今天的電話會議還包括非GAAP調整後的財務指標。與 GAAP 指標的調節表包含在今天的獲利新聞稿和我們的調節表幻燈片中，這些幻燈片可在我們網站 AppliedMaterials.com 的投資者頁面上找到。現在我想把電話交給加里·迪克森。

Thanks, Mike, and good afternoon, everyone. I'll start by commenting on Applied Materials' results, and talk about our outlook and longer-term strategic goals. Then I'll share our views on the market, and what this means for us in 2016. I'll conclude with my thoughts on each of our major businesses. After that, Bob will provide additional details about our results, and describe how we're optimizing the Company's performance, and delivering strong shareholder returns.

謝謝你，麥克，大家下午好。我先對應用材料公司的業績發表評論，然後談談我們的前景和長期策略目標。然後我將分享我們對市場的看法，以及這對我們2016年意味著什麼。最後，我將談談我對我們各項主要業務的看法。之後，鮑伯將提供有關我們業績的更多細節，並描述我們如何優化公司業績，並為股東帶來強勁的回報。

In both semiconductor and display, we see dramatic technology changes taking place. When we look at the advances our customers are making, materials innovation is at the heart of these changes. I believe this creates great opportunities for us. We have the broadest and deepest talent and technology, to enable the materials innovation that will drive the semiconductor and display industries forward.

半導體和顯示技術都正在發生巨大的變化。當我們審視客戶所取得的進步時，會發現材料創新是這些變革的核心。我相信這會為我們創造巨大的機會。我們擁有最廣泛、最深厚的人才和技術，能夠推動材料創新，從而促進半導體和顯示器產業向前發展。

Our strategy is to develop highly-differentiated materials engineering products and services, that make major technology inflections possible. Our strategy is working, and I'm pleased with our progress. We are turning the investments we've made in new products into profitable growth.

我們的策略是開發高度差異化的材料工程產品和服務，使重大技術變革成為可能。我們的策略奏效了，我對我們的進展感到滿意。我們將對新產品的投資轉化為獲利成長。

When I look at our Q1 results and our outlook for 2016, there are four main drivers of our performance. First, our leadership businesses, including epi, PVD, implant, CMP, and RTP have high market share and unique capabilities. I see these businesses delivering critical enabling technology that our customers need to drive significant innovations in transistor and interconnect for 10-nanometer devices. Second, our high growth businesses, etch and CVD, are winning substantial market share as the 3D NAND inflection and materials-enabled scaling accelerates.

當我審視我們第一季的業績和對 2016 年的展望時，我發現我們業績的主要驅動因素有四個。首先，我們的領先業務，包括外膜、PVD、植入物、CMP和RTP，都擁有較高的市場份額和獨特的能力。我看到這些企業提供關鍵的使能技術，而我們的客戶需要這些技術來推動 10 奈米裝置的電晶體和互連技術的重大創新。其次，隨著 3D NAND 拐點和材料賦能的規模化加速，我們的高成長業務蝕刻和 CVD 正在贏得相當大的市場份額。

Third, we are delivering sustainable growth and service. 2015 was a record year for service revenue, and in Q1, we booked our highest orders ever. And finally, we are growing beyond semiconductor, specifically in display. When I meet with leading display companies, it is clear that the industry is becoming highly dependent on materials innovation, especially as they introduce new technologies like OLED. This plays to our strengths, and significantly expands our market.

第三，我們正在實現永續成長和服務。2015 年是服務收入創紀錄的一年，第一季我們獲得了有史以來最高的訂單量。最後，我們的業務正在超越半導體領域，尤其是在顯示器領域。當我與領先的顯示器公司會面時，很明顯，該行業正變得越來越依賴材料創新，尤其是在他們推出 OLED 等新技術之後。這發揮了我們的優勢，並大大擴大了我們的市場。

Now, let's turn to our market outlook. Like everyone, I'm mindful of the current global economic risks. Even in this environment, we believe 2016 wafer fab equipment spending levels will be similar to 2015. We are seeing industry investment focused on technology inflections, including 10-nanometer and 3D NAND, as well as increased spending in China.

現在，讓我們來看看市場前景。和大家一樣，我也很清楚當前全球經濟存在的風險。即使在這種環境下，我們認為 2016 年晶圓製造設備支出水準將與 2015 年類似。我們看到，產業投資正集中於技術轉折點，包括 10 奈米和 3D NAND，以及在中國增加支出。

For our customers, the inflection-driven investments in foundry, logic and memory are highly strategic. We have been witnessing a fierce battle for leadership in these new device technologies. When I talk to customers about their major competitive challenges, they talk about how critical it is to hit the right timing for major technology transitions.

對我們的客戶而言，在晶圓代工、邏輯電路和記憶體領域進行由經濟拐點驅動的投資具有高度戰略意義。我們目睹了這些新興設備技術領域的激烈領導權爭奪戰。當我與客戶談論他們面臨的主要競爭挑戰時，他們會談到掌握重大技術轉型時機的重要性。

In foundry, we believe 2016 investment levels will be more or less the same as last year. We anticipate that the majority of spending will be for the 10-nanometer node, which will be heavily weighted towards the second half of the calendar year. In addition, we see a broadening of foundry spending, and some shifts in customer mix, shifts that I believe are very favorable to us.

我們認為，2016 年鑄造業的投資水準將與去年大致相同。我們預計大部分支出將用於 10 奈米節點，而這主要集中在下半年。此外，我們看到代工廠支出範圍擴大，客戶結構也發生了一些變化，我認為這些變化對我們非常有利。

In memory, we see NAND investment up about 25% year-on-year, as more customers ramp 3D NAND technology. Our available market at a 3D NAND factory is up to three times greater compared to traditional planar technology. 2015 was a year of heavy DRAM investment, with the highest level of spending in five years. This year, we expect DRAM investment to be down around 20%, coming off this high. And in logic, we expect investment to be relatively flat year on year.

在記憶體領域，我們看到 NAND 投資年增約 25%，因為越來越多的客戶正在加大對 3D NAND 技術的投入。與傳統平面技術相比，我們在 3D NAND 工廠的潛在市場規模要大三倍。2015 年是 DRAM 投資大年，支出水準達到五年來的最高水準。今年，我們預計DRAM投資將從今年的高點回落約20%。從邏輯上講，我們預期投資額將逐年保持相對穩定。

Within the global environment, I look at China as a very significant opportunity. In China, we are seeing growth in revenue and orders both from Chinese manufacturers, as well as multinational customers who are expanding their footprint. I believe that Applied is very well positioned. We were the first company in our industry to establish a presence in China, more than 30 years ago. Today, we have strong customer relationships and great talent to support the new projects that are ramping there.

在全球環境下，我認為中國是一個非常重要的機會。在中國，我們看到來自中國製造商以及正在擴大業務範圍的跨國客戶的收入和訂單都在成長。我認為Applied公司目前處於非常有利的地位。30多年前，我們是業界第一家在中國設立分公司的公司。如今，我們擁有強大的客戶關係和優秀的人才，能夠支持正在當地加速的新專案。

Now that I've given you this background on the market environment, I would like to talk about the progress and priorities for each of our major businesses. In semiconductor equipment, I'm pleased with our momentum. Technology changes are moving the market to our sweet spot in materials engineering, and this means that our served market is now 60% of total wafer fab equipment.

現在我已經向大家介紹了市場環​​境的背景，接下來我想談談我們各主要業務的進展和優先事項。在半導體設備領域，我對我們目前的發展勢頭感到滿意。技術變革正將市場推向我們在材料工程領域的優勢所在，這意味著我們服務的市場現在佔晶圓製造設備總量的 60%。

We are investing more than ever in innovation and unique products, to accelerate materials-enabled scaling for our customers. I like how our future pipeline is shaping up, and we have very strong pull for our latest technology. We are projecting that 40% of our 2016 revenue will come from products that we launched in the last three years. In 2015, we believe that we made solid share gains in wafer fab equipment, with almost all of our major businesses growing or maintaining their market position. I expect that 2016 will be an even stronger year for us.

我們比以往任何時候都更重視創新和獨特產品的研發投入，以加速材料賦能型規模化生產，從而更好地服務我們的客戶。我對我們未來的產品線發展方向感到滿意，而且市場對我們的最新技術有著非常強勁的需求。我們預計 2016 年 40% 的營收將來自過去三年推出的產品。2015年，我們相信我們在晶圓製造設備領域取得了穩健的市場份額成長，我們幾乎所有主要業務都實現了成長或維持了市場地位。我預計2016年對我們來說將是更加強勁的一年。

In service, we aligned our strategy to enable customer success. We've done this by bringing together capabilities from across the Company, to deliver more value with our service products. The changes we've made to our strategy drove record performance in 2015, and we are now focusing on sustaining growth in this business.

在服務方面，我們調整了策略，以幫助客戶成功。我們透過整合公司各部門的能力，為我們的服務產品創造更多價值。我們對策略所做的調整在 2015 年帶來了創紀錄的業績，現在我們正專注於保持這項業務的成長。

Because demand for service is seasonal in nature, we believe year-on-year comparisons are helpful. Our Q1 revenues are up 7%, compared with the same period last year. I also look at service contracts as another leading indicator of our future growth. If we look back to 2012 and 2013, the net number of tools under contract was not growing.

由於服務需求具有季節性，我們認為逐年比較是有幫助的。與去年同期相比，我們第一季的營收成長了7%。我還將服務合約視為我們未來成長的另一個領先指標。回顧 2012 年和 2013 年，合約工具的淨數量並沒有增加。

In 2015, we added around 1,250 tools under contract, and I expect us to continue this momentum. As I mentioned in display, customers are also making strategic investments in new technology. We are seeing these investments accelerate, particularly for OLED displays.

2015 年，我們新增了約 1250 件工具的合同，我預計我們將繼續保持這一勢頭。正如我在展示部分提到的，客戶也在對新技術進行策略性投資。我們看到這些投資正在加速，尤其是在OLED顯示器領域。

The display technology inflections significantly expand our available markets. For example, we project that our opportunity at an OLED factory is more than 3 times larger than at a traditional amorphous silicon LCD factory. We have great opportunities and momentum in display, and I am excited about how we are positioned. Our display business has grown consistently for the past three years, and we expect to deliver additional growth in 2016 and beyond.

顯示技術的革新大大拓展了我們的市場。例如，我們預計我們在 OLED 工廠的機會比在傳統非晶矽 LCD 工廠的機會大 3 倍以上。我們在展覽領域擁有巨大的機會和發展勢頭，我對我們的定位感到非常興奮。過去三年，我們的顯示器業務持續成長，我們預計在 2016 年及以後將繼續保持成長。

To summarize, as I look ahead, I am confident about our future growth and performance. We are maintaining a positive outlook for Applied in 2016, because our customers are making strategic inflection-driven investments that play to our strengths. Our leadership businesses where we have unique capabilities are performing well, as the market comes to the sweet spot of our technology.

總而言之，展望未來，我對我們的未來發展和業績充滿信心。我們對 Applied 在 2016 年的發展前景保持樂觀，因為我們的客戶正在進行策略性轉折點驅動的投資，這充分發揮了我們的優勢。我們擁有獨特能力的領先業務表現良好，因為市場正逐漸適應我們技術的最佳應用場景。

Our high-growth businesses, etch and CVD, are making significant market share gains as the 3D NAND inflection accelerates. And we are delivering sustainable growth in service and display. Across the organization, we are focused on delivering enabling products and services, and generating attractive returns for our shareholders. Now, let me hand the call over to Bob, who will provide more details about our quarterly results, performance and priorities. Bob?

隨著 3D NAND 拐點加速擴大，我們的高成長業務蝕刻和 CVD 正在獲得顯著的市場份額成長。我們在服務和展示方面實現了永續成長。整個組織致力於提供有益的產品和服務，並為股東創造可觀的回報。現在，我將把電話交給鮑勃，他將詳細介紹我們的季度業績、表現和工作重點。鮑伯？

Thanks, Gary. Like Gary, I believe we're in a strong position to deliver profitable growth in 2016, as our customers invest in the technology roadmaps across semi and display. Based on the demand outlooks of our customers, I believe we'll make significant progress this year towards our 2018 financial model, and we'll deliver very attractive cash returns to our shareholders.

謝謝你，加里。與 Gary 一樣，我相信我們有能力在 2016 年實現獲利成長，因為我們的客戶正在投資半導體和顯示器領域的技術路線圖。根據客戶的需求預測，我相信今年我們將朝著 2018 年的財務模型取得重大進展，並為股東帶來非常可觀的現金回報。

On the revenue line, I'm encouraged by the progress we're making in semiconductor systems market share. While we expect the WFE market to be about the same size this calendar year, we believe our share of WFE will be higher. We expect our SAM share of WFE to expand this year as well. In fact, we believe it will be up 7 points compared to 2012. Our global services business is on track for a third consecutive year of growth, and we believe our display business will grow for a fourth consecutive year. I'm also encouraged by the progress our teams are making on our gross margin initiatives, and I am still confident that we'll make additional progress in our second half.

在營收方面，我對我們在半導體系統市佔率方面的進展感到鼓舞。雖然我們預計今年 WFE 市場規模與往年大致相同，但我們相信我們在 WFE 市場中的份額將會更高。我們預計今年在WFE中的SAM份額也將繼續擴大。事實上，我們認為它將比 2012 年上漲 7 個百分點。我們的全球服務業務預計將連續第三年實現成長，我們相信我們的顯示器業務也將連續第四年實現成長。我也對我們團隊在提高毛利率方面取得的進展感到鼓舞，我仍然相信我們在下半年會取得更大的進展。

On the operating expense line, we are tightly controlling our discretionary spending, holding OpEx relatively flat, while strengthening R&D. We are making substantial R&D investments to deliver a strong pipeline of new products for emerging inflections. These products are already delivering revenue growth today. At the same time, we are reducing non-GAAP G&A to the lowest level in years. We made further progress with our tax structure, and I believe we're on track to lower the rate once again this year.

在營運費用方面，我們嚴格控制可自由支配的支出，維持營運費用相對穩定，同時加強研發投入。我們正在進行大量的研發投入，以推出一系列強大的新產品，以應對新興市場的變化。這些產品目前已經帶來了營收成長。同時，我們將非GAAP一般及行政費用降至多年來的最低水準。我們在稅收結構方面取得了進一步進展，我相信我們今年將再次降低稅率。

We continue to be aggressive with the buyback program. We've repurchased 112 million shares over the past three quarters, which is equal to 9% of the shares outstanding at the beginning of the program. So while 2016 is shaping up to be a flattish year for WFE, we believe Applied will outperform our markets, making significant progress towards our financial 2018 model, and deliver very attractive cash returns for our shareholders.

我們將持續積極推動股票回購計畫。在過去的三個季度裡，我們回購了 1.12 億股股票，相當於該計畫開始時流通股的 9%。因此，儘管 2016 年對 WFE 來說可能是一個較為平淡的年份，但我們相信 Applied 將跑贏大盤，朝著我們 2018 年的財務模型取得重大進展，並為我們的股東帶來非常可觀的現金回報。

Next, I'll make a few comments about the first quarter, when we delivered financial results that were slightly better than our expectations. Revenue of $2.3 billion declined 5% sequentially, and we slightly increased our non-GAAP gross margin to 42.4%. We held non-GAAP operating expenses within the range, and we delivered non-GAAP EPS of $0.26, slightly above the midpoint of the range.

接下來，我將對第一季做一些評論，我們第一季的財務表現略優於預期。營收為 23 億美元，季減 5%，非 GAAP 毛利率略微提高至 42.4%。我們將非GAAP營運費用控制在預期範圍內，並實現了非GAAP每股收益0.26美元，略高於預期範圍的中點。

Turning to the balance sheet, we used $625 million to repurchase 35 million shares of our stock. We have completed 65% of the $3 billion authorization, and we'll continue to be opportunistic with the program. We also repaid $800 million in short-term debt, and redeemed a $400 million bond, scheduled to mature in June.

從資產負債表來看，我們用 6.25 億美元回購了 3,500 萬股股票。我們已經完成了30億美元授權金額的65%，我們將繼續抓住機會推進該計劃。我們還償還了 8 億美元的短期債務，並贖回了 6 月到期的 4 億美元債券。

Turning to the segments, silicon systems orders were 12% lower sequentially. Within the mix, only DRAM orders were higher. Our silicon backlog remained healthy at $1.6 billion, and while revenue declined in Q1, we believe our demand will increase in Q2 and the second half.

從各細分市場來看，矽系統訂單季減 12%。其中，只有DRAM訂單量更高。我們的矽晶片積壓訂單仍維持在16億美元的健康水平，雖然第一季的營收有所下降，但我們相信第二季和下半年的需求將會增加。

Our AGS orders reached $773 million, and set another all-time quarterly record. AGS sequential revenue was slightly lower, consistent with seasonal patterns. Our display orders were down 6% sequentially, but remained up year-over-year.

我們的 AGS 訂單金額達到 7.73 億美元，再次創下季度歷史新高。AGS 的環比收入略有下降，這與季節性規律相符。我們的展示品訂單較上季下降 6%，但年成長仍維持成長。

Our display revenue increased 12% sequentially. Bear in mind, the display orders and revenue will continue to be lumpy. EES turned a modest profit, even as revenue remained at low levels.

我們的顯示器收入較上季成長了12%。請注意，展示訂單和收入將繼續波動。儘管收入仍然很低，但EES還是實現了小幅獲利。

Now I'll provide our business outlook for Q2. We believe our overall net sales would be up by 5% to 10% sequentially. Within this outlook, we expect silicon systems net sales will be up by 11% to 17%. AGS net sales should be flat to up 5%. We expect our display net sales to be down by 20% to 30% and EES net sales should be approximately $55 million.

現在我將介紹我們第二季的業務展望。我們認為整體淨銷售額將季增 5% 至 10%。在此展望下，我們預期矽系統淨銷售額將成長 11% 至 17%。AGS淨銷售額預計持平或成長5%。我們預計顯示器淨銷售額將下降 20% 至 30%，EES 淨銷售額約為 5,500 萬美元。

Our non-GAAP gross margin should be approximately flat, and we plan to hold non-GAAP operating expenses in a range of $565 million plus or minus $10 million. We are forecasting a Q2 non-GAAP tax rate of 17%, and we believe non-GAAP EPS will be in the range of $0.30 to $0.34.

我們的非GAAP毛利率應該基本上持平，我們計劃將非GAAP營運費用控制在5.65億美元上下1000萬美元的範圍內。我們預測第二季非GAAP稅率為17%，我們認為非GAAP每股盈餘將在0.30美元至0.34美元之間。

So in summary, we see 2016 as a year when a broad range of our customers invest in leading-edge technology across semi and display. Our investments have put us in a position to grow our served market, revenue, share, and earnings. While we're mindful of the macroeconomic concerns, we believe 2016 will be a strong year for Applied Materials. Now, let me turn the call over to Mike for questions.

總而言之，我們認為 2016 年是眾多客戶投資半導體和顯示器領域尖端技術的一年。我們的投資使我們能夠擴大服務市場、增加收入、提高市場份額和增加利潤。儘管我們關注宏觀經濟方面的擔憂，但我們相信 2016 年對於應用材料公司來說將是強勁的一年。現在，我把電話交給麥克，讓他回答問題。

Thanks, Bob. To help us reach as many of you as we can, please ask no more than one question and no more than one brief follow-up. Operator, please let's begin.

謝謝你，鮑伯。為了幫助我們聯繫到盡可能多的人，請您每次只提一個問題，並且只進行一次簡短的後續詢問。操作員，請開始。

(Operator Instructions)

（操作說明）

Your first question comes from the line of C.J. Muse from Evercore ISI. Your line is open.

你的第一個問題來自 Evercore ISI 的 C.J. Muse 的一句話。您的線路已開通。

Good afternoon. Thank you for taking my question. I guess first question, on the silicon side, so given your outlook for you to outgrow WFE, and where you are in terms of backlog and the orders in the quarter, the math seems to work that orders should be up at least 20%, 25% into the April quarter, and then rising through the back half of the year. Is that the framework you're looking for? And I guess within that, how should we be thinking about mix between foundry, logic and memory through the year?

午安.感謝您回答我的問題。我想第一個問題，關於晶片方面，鑑於你們預計會超越 WFE，以及你們目前的積壓訂單和本季度訂單情況，從數學角度來看，訂單應該至少增長 20%，到 4 月份季度增長 25%，然後在下半年繼續增長。這是你想要的框架嗎？那麼，在這個框架內，我們該如何思考全年架構、邏輯和記憶體之間的融合呢？

Sure. C.J. I'll take a shot at that. We're not giving specific orders guidance, but we have said -- we do believe that the second half is stronger than the first half. We do believe that the first half is a little bit more weighted to NAND, whereas the second half is more weighted to stronger performance in foundry, logic and DRAM. So we do see a stronger second half. And incrementally, we see strong performance for Applied in the second half, because of our position on VNAND throughout the year and also foundry in the 10-nanometer conversion. We think the second half does feel more positive than the first half, and our position is pretty good in the second half.

當然。C.J. 我來試試。我們不給出具體的訂單指導，但我們說過——我們相信下半年會比上半年更強勁。我們認為，前半部分更側重於 NAND，而後半部分則更側重於晶圓代工、邏輯電路和 DRAM 的更強性能。所以我們看到下半年表現更強勁。而且，我們看到應用材料在下半年業績表現強勁，這得益於我們全年對 VNAND 的佈局以及在 10 奈米製程轉換方面的代工業務。我們認為下半場比上半場感覺更積極，我們在下半場的處境也相當不錯。

Excellent. And I guess as follow-up, how should we think about the trajectory here off of a flat gross margin guide into the back half of the year?

出色的。那麼，作為後續問題，我們該如何看待下半年毛利率持平的預期呢？

Sure. We said on the last call that Q -- first half of FY16 would be flattish with the fourth quarter of FY15, when we did 42.2%. We did 42.4% in first quarter this year. We're guiding to about the same in Q2, so we're a little above what we thought we were a quarter ago, and we still believe that the second half is up from the first half. We said last call there would be a 200-basis point, roughly increase from first half to second half.

當然。我們在上次電話會議上說，2016 財年上半年的業績將與 2015 財年第四季持平，當時我們的業績為 42.2%。今年第一季我們實現了 42.4% 的成長率。我們預期第二季業績與上季大致相同，比上個季度的預期略高，我們仍然相信下半年業績會比上半年有所成長。我們上次提到，匯率將上漲 200 個基點，大致相當於上半年到下半年的漲幅。

We think the full year is still positive, as we've said. We think we exit the year, we think we're up in the second half. But given that we're a little ahead of plan in the first half, I don't know that there is a 200-basis point improvement from first half to second half.

正如我們之前所說，我們認為全年情況依然樂觀。我們認為到年底時，下半年我們會有所進步。但鑑於我們上半年比計劃略微領先，我不認為下半年會比上半年提高 200 個基點。

Got you. Makes sense. Thanks so much.

抓到你了。有道理。非常感謝。

Your next question comes from the line of Toshiya Hari from Goldman Sachs. Your line is open.

你的下一個問題來自高盛的 Toshiya Hari。您的線路已開通。

Thank you for taking my question, and congratulations on a solid quarter and a strong guide. I have two questions, as well. The first one is regarding memory CapEx. Just given the pricing dynamics in memory, are you worried at all about DRAM and NAND CapEx in the back half of the year? Or do you think the pending projects are strategic enough for your customers to spend according to plan?

感謝您回答我的問題，並祝賀您本季業績穩健，且擁有優秀的指導意見。我也有兩個問題。第一個問題與記憶體資本支出有關。考慮到記憶體的價格動態，您是否擔心下半年DRAM和NAND的資本支出？或者您認為這些待辦事項是否具有足夠的策略意義，能夠讓您的客戶按計畫支出？

So generally we think this year is flattish with last year, with last year. It was like $31.5 million to $32 million. But the year is a good year for Applied Materials. If you look at the spending this year, we think foundry and logic are flattish, but the mix within foundry and logic spending, in terms of what they are buying and customer profile is very good for Applied.

所以總的來說，我們認為今年與去年相比基本持平。金額大概在3150萬美元到3200萬美元之間。但今年對應用材料公司來說是個好年。如果從今年的支出來看，我們認為晶圓代工和邏輯電路的支出基本上持平，但晶圓代工和邏輯電路的支出組合，就其購買的產品和客戶組成而言，對應用科技來說非常有利。

The second thing is within memory, we think memory, DRAM's down about 20%. We think flash is up about 25%. And the predominant spending in flash is VNAND, so the transition on VNAND is particularly good for Applied on three levels. One, the absolute level of greenfield spending for first and second generation VNAND is higher than the absolute spending for planar NAND.

第二點是記憶體方面，我們認為 DRAM 記憶體下降了約 20%。我們認為快閃記憶體價格上漲了約 25%。快閃記憶體領域的主要支出是 VNAND，因此 VNAND 的轉型對應用材料來說在三個層面上都非常有利。第一，第一代和第二代 VNAND 的全新投資絕對水準高於平面 NAND 的全新投資絕對水準。

The second thing is that the re-use, where they were doing a lot of re-use and the shrink from planar is significantly less than first and second generation VNAND, and particularly around tools that we sell. And thirdly, we're gaining on the transition. So I think that the mix within this for Applied, in terms of our concern, we think the $31.5 million type number, maybe a little more on the year is a fair estimate. We think we've taken the risk you've referenced into account.

第二點是，他們進行了大量重複利用，平面結構的縮小幅度明顯小於第一代和第二代 VNAND，尤其是在我們銷售的工具方面。第三，我們在轉型方面取得了進展。所以我認為，就我們所關注的情況而言，Applied 的這部分組合中，我們認為 3150 萬美元左右的數字，或許比今年略高一些，是一個合理的估計。我們認為我們已經考慮到了您提到的風險。

Okay. Helpful. Thank you. The second one is regarding your display business. I know Gary and Bob, you both touched on this. But can you maybe talk a little bit about what you're seeing in terms of order trends primarily in China today, and how big the OLED opportunity could be for you in 2017 and beyond, I'm guessing primarily in Korea?

好的。很有幫助。謝謝。第二個問題與你的展示業務有關。我知道加里和鮑勃，你們倆都談到了這一點。但您能否談談您目前主要在中國觀察到的訂單趨勢，以及OLED在2017年及以後（我猜主要是在韓國）對您來說可能有多大的機會？

Sure. OLED is a great opportunity for Applied. We've talked about the increase in the total available market. Their added CVD, PVD, thin-film encapsulation steps, so if you do a comparison to amorphous silicon LCD, the total available market is up by about a factor of 3 for us.

當然。OLED 對應用科技來說是個絕佳的機會。我們已經討論過市場總供應量的成長。他們增加了 CVD、PVD、薄膜封裝等步驟，因此，如果與非晶矽 LCD 進行比較，我們的市場總規模大約成長了 3 倍。

In display, we've talked about 2016. We're anticipating being a fourth consecutive year of growth. And based on everything we're seeing, we're on track to either hit or exceed the 2018 model that we published for display previously. So display, and we have tremendous momentum. And certainly OLED, especially in mobile, is a huge opportunity for us. The other thing I would say is that this is really a great proof of our ability to expand materials engineering into adjacent markets.

在展覽中，我們談到了 2016 年。我們預計將連續第四年實現成長。根據我們目前所看到的一切，我們預計將達到或超過先前公佈的 2018 年模型。所以，展示出來吧，我們勢頭強勁。當然，OLED，尤其是在行動裝置領域，對我們來說是一個巨大的機會。我想說的另一點是，這確實很好地證明了我們有能力將材料工程擴展到相鄰市場。

Thank you so much.

太感謝了。

Your next question comes from the line of Joe Moore from Morgan Stanley. Your line is open.

你的下一個問題來自摩根士丹利的喬摩爾。您的線路已開通。

Great. Thank you. I wonder if you could talk a little bit about the lumpiness in some of the order patterns, particularly NAND? I mean, for NAND to be as strong as you've talked about, it seems like it's going to come back a lot in the second quarter. Is that the right trajectory? Then longer term, how long do you think this 3D investment sustains, and when do you think that might peak?

偉大的。謝謝。我想請您談談某些訂單模式中的不均勻性，特別是 NAND 快閃記憶體的訂單模式？我的意思是，如果 NAND 像你所說的那樣強勁，那麼它似乎會在第二季度大幅反彈。這是正確的方向嗎？那麼從長遠來看，您認為這種 3D 投資能持續多久，又會在何時達到高峰？

Sure. I'll take a shot at that. So if you look at the disconnect is, we think that NAND is stronger in the second half than the first half, and we think there's an increasing traction around VNAND. I'm sorry. NAND is stronger first half than second half.

當然。我來試試。所以，如果你仔細觀察這種脫節現象，我們會發現，我們認為 NAND 在下半年比上半年更強勁，而且我們認為 VNAND 的發展勢頭越來越強勁。對不起。NAND快閃記憶體前半部比後半部更強。

And you would say well, why did you have bigger DRAM orders, and not NAND? We had already booked some. If you go look back at Q3, Q4 of 2015, we had very large bookings, and some of those were VNAND bookings.

然後你會問，為什麼你們的DRAM訂單量更大，而不是NAND訂單量更大？我們已經預訂了一些。回顧 2015 年第三季和第四季度，我們獲得了非常大的訂單量，其中一些是 VNAND 訂單。

Secondly, we see increasing traction. So if you see why we're beating in Q2, it's around two things in particular. It's around China and a wider proliferation of VNAND. So we do see the momentum in VNAND and we're pretty comfortable it's going to happen.

其次，我們看到市場反應越來越好。所以，如果你想知道我們為什麼能在第二季取得勝利，主要有兩個原因。它主要集中在中國，並且VNAND的普及範圍更廣。所以我們確實看到了 VNAND 的發展勢頭，而且我們相當有信心它會成功。

And then in terms of the length, the duration of this investment.

然後就投資期間而言。

Oh, the duration.

哦，時長。

Does it grow again, you think, in 2017? Do you have the visibility to say that?

你認為它在2017年會再次成長嗎？你有足夠的資格這麼說嗎？

Right now, there's about 1.4 million wafer starts in the world of NAND. Through the end of calendar 2015, 150,000 had been converted. We think cumulatively through the end of 2016, it's going to be 350,000 to 400,000. Through the end of 2016, 400,000 of the 1.4 million available have been converted. We think most of those get converted over time.

目前，NAND 快閃記憶體領域約有 140 萬片晶圓開工生產。截至 2015 年底，已有 15 萬人完成轉換。我們認為到 2016 年底，累計數字將達到 35 萬至 40 萬。截至 2016 年底，140 萬可用資金中已有 40 萬人被轉換。我們認為隨著時間的推移，其中大部分都會轉化。

This year, we think NAND spending is about $8.7 million. We think it's sustained at pretty good levels for the next few years for this conversion. Does it stay that high? I'm not sure, but it's a pretty healthy number.

今年，我們認為 NAND 的支出約為 870 萬美元。我們認為，未來幾年這種轉換率將維持在相當不錯的水平。它會一直保持那麼高嗎？我不太確定，但這應該是一個相當健康的數字。

Very helpful. Thank you very much.

很有幫助。非常感謝。

Your next question comes from the line of Timothy Arcuri from Cowen and Company. Your line is open.

你的下一個問題來自 Cowen and Company 的 Timothy Arcuri。您的線路已開通。

Thanks a lot. Actually, I had two. First, Bob, if I look at the service, orders have been pretty meaningfully above revenue for about a year now, and I thought that service usually had a one-year contract. So I guess I would have thought we would see some catch-up on revenue relative to bookings. Are these contracts now lengthening out beyond the year? Can you bridge that gap for us? Thanks.

多謝。其實我有兩個。首先，鮑勃，如果我看一下這項服務，訂單量已經連續一年明顯高於收入，而我認為這項服務通常簽訂的是一年合約。所以我覺得我們原本以為收入會相對於預訂量有所成長。這些合約的期限現在是否超過一年？你能幫我們彌補這個差距嗎？謝謝。

Yes, the service contracts are a good leading indicator of revenue, and they're also a good leading indicator of sustainability of revenue, because you build in that relationship over time, and customers get greater value from us, frankly. It's a win-win both ways. In terms of how you recognize it through the revenue plan, it is happening.

是的，服務合約是收入的良好先行指標，也是收入可持續性的良好先行指標，因為隨著時間的推移，你會建立起這種關係，坦白說，客戶會從我們這裡獲得更大的價值。這對雙方都有利。從收入計劃的確認方式來看，它確實正在發生。

A couple of things are happening in the quarter. One, you did have the Chinese New Year, and a little bit of slowdown started up earlier in Q1. So we book a lot of contracts typically in Q1. But the revenue, it's not a high revenue quarter. And fab utilization was okay in the quarter, so in terms of tactical sales of spares and services, not super high. And then 200-millimeter tools are in that number, too, and those go up and down a little bit.

本季有兩件事要發生。第一，春節期間經濟放緩，第一季初經濟成長略有下降。所以我們通常會在第一季簽訂很多合約。但就營收而言，本季營收並不高。本季晶圓廠利用率尚可，因此，就備件和服務的戰術銷售而言，銷售額並不算特別高。200 毫米的工具也包含在這個數字中，而且這些工具的數量還會略有上下波動。

Okay, great. Thanks, Bob. And Gary, just a question for you on M&A. Can you just talk at a very, very high level about that? There's just not a lot of stuff in your current SAM that really can move the needle for you. I guess the question is your willingness to think a bit outside the box, and maybe expand your SAM into some new verticals? Thanks a lot.

好的，太好了。謝謝你，鮑伯。Gary，關於併購，我有個問題想問你。能就此問題簡單談談嗎？你目前的SAM中並沒有太多真正能對你產生影響的東西。我想問題在於你是否願意跳脫固有思維模式，或許將你的SAM業務拓展到一些新的垂直領域？多謝。

Thanks for the question. Regarding our current strategy, we like our current strategy. The outlook for 2016, we think, is very strong and beyond 2016, we also believe that there is great opportunities for growth. We have a strong position in transistor and interconnect, as foundry and logic moves to the new technology nodes. Very strong pull for etch deposition tools also, especially in the memory space, but certainly in patterning, in future technology nodes.

謝謝你的提問。關於我們目前的策略，我們很滿意。我們認為 2016 年的前景非常強勁，我們相信，2016 年以後也存在著巨大的成長機會。隨著代工和邏輯電路向新技術節點發展，我們在電晶體和互連領域佔據了強大的地位。對蝕刻沉積工具的需求也非常強勁，尤其是在記憶體領域，當然在未來的技術節點中，在圖形化領域也肯定會有很大的需求。

We're growing service, growing the display business, and we believe that's sustainable growth in those markets. So overall, we're making tremendous progress toward the 2018 model, and we're optimistic about growth opportunities for Applied, especially when you look at what's driving, what's driving this year and what's going to drive the future. You have 10-nanometer, that is really based on materials, new materials, 10-nanometer, 7-nanometer, new memory technologies, organic LED displays. All of those areas are enabled by materials innovation, where Applied has clear leadership. And we think this is a -- we're in the early innings of these changes, in driving materials-enabled scaling. So I am personally very optimistic about growth for Applied Materials.

我們正在發展服務業，發展顯示器業務，我們相信這在這些市場中是可持續的成長。總的來說，我們在實現 2018 年模式方面取得了巨大的進展，我們對 Applied 的成長機會持樂觀態度，尤其是在考慮驅動因素、今年的驅動因素以及未來將要驅動的因素時。10 奈米技術，這實際上是基於材料、新材料、10 奈米、7 奈米、新的儲存技術、有機發光二極體顯示器。所有這些領域都離不開材料創新，而應用材料公司在該領域擁有明顯的領先地位。我們認為，我們正處於這些變革的早期階段，推動材料賦能規模化發展。所以我個人對應用材料公司的發展前景非常樂觀。

Relative to M&A, our strategy continues to be pretty much the same. We continue to look for good opportunities, but we're very selective in what we look at. There's three criteria: financial return; strategic alignment, especially with our engineering materials technologies; and does the Company have an opportunity for leadership in whatever segments that they are in. So those are the three things we look at. Certainly we keep looking for opportunities, but I am very confident about our growth opportunities, and we are definitely not needy, relative to M&A.

在併購方面，我們的策略基本上保持不變。我們一直在尋找好的機會，但我們對關注的對象非常挑剔。有三個標準：財務回報；策略一致性，特別是與我們的工程材料技術；以及公司在其所處的任何領域是否有領導地位的機會。所以，這就是我們關注的三件事。當然，我們會繼續尋找機會，但我對我們的成長機會非常有信心，而且相對於併購而言，我們絕對不迫切需要。

Thanks a lot for that, Gary. Thanks.

非常感謝你，加里。謝謝。

Your next question comes from the line of Romit Shah from Nomura Securities. Your line is open.

你的下一個問題來自野村證券的羅米特·沙阿。您的線路已開通。

Yes, thank you. You talked about strength in China and I'm seeing orders in this region up 20% sequentially, and up over 50% year-over-year, and in terms of regions, your second-largest region for total orders. Can you talk a little bit about what's driving that strength, and the sustainability of it?

是的，謝謝。您提到了中國市場的強勁勢頭，我看到該地區的訂單環比增長了 20%，同比增長超過 50%，就地區而言，中國是你們訂單總量第二大的地區。您能否談談這種優勢的驅動因素以及其永續性？

I can start, and then, Bob, if you want to add anything. So clearly, there's a lot of activity in China. We see investments by both multinational companies and domestic companies.

我可以先開始，然後，鮑勃，如果你想補充什麼的話。顯然，中國有很多活動。我們看到了跨國公司和國內公司的投資。

Applied has a very strong position in China. We were the first company to build capability there about 30 years ago, very strong team, very strong capability, very good relationships and positions with both the Chinese companies and the multinational companies that are moving to China. So we look at this as certainly an incrementally very good opportunity in 2016, but I would -- my feeling is this is certainly not just a 2016 story, that there is a great opportunity going forward, and for Applied, we're very, very well positioned.

應用材料在中國市場擁有非常強大的地位。大約 30 年前，我們是第一家在那裡建立能力的公司，擁有非常強大的團隊、非常強大的能力，與中國公司和正在遷往中國的跨國公司都建立了非常好的關係和地位。因此，我們認為這在 2016 年無疑是一個非常好的機會，但我的感覺是，這絕不只是 2016 年的故事，未來還有很大的發展機會，而對於 Applied 來說，我們已經做好了非常非常充分的準備。

Okay. Thanks. Thanks, Gary. And then I also had a question on OLED. Your display business was about $700 million to $800 million last year. Can you break down for us, within that, how much was OLED revenue, and when do you think this business actually starts to move the needle for total revenues?

好的。謝謝。謝謝你，加里。然後我還有一個關於OLED的問題。去年你們的展示業務規模約7億至8億美元。能否請您具體分析一下，其中 OLED 的收入是多少？您認為這項業務何時才能真正開始對總收入產生顯著影響？

Sure. We segment it a couple of ways. One, we talk about historically between TVs and smaller screens. And the smaller screens historically have been split between OLED and non-OLED.

當然。我們用以下幾種方式來劃分。首先，我們從歷史角度來討論電視和小螢幕之間的關係。而小尺寸螢幕歷來分為 OLED 和非 OLED 兩類。

Last year, mostly what we sold was OLED, was in encapsulation tools. Those were OLED-like. We talked about bookings last year of $150 million. Many people in the mainstream media speculate that there will be a more rapid transition, particularly in small screens to OLED. We are pretty well positioned for that.

去年，我們銷售的大部分產品是 OLED 封裝工具。它們看起來像OLED螢幕。我們談到了去年1.5億美元的預訂量。主流媒體中的許多人猜測，OLED 的過渡速度將會更快，尤其是在小螢幕領域。我們在這方面已經做好了相當充分的準備。

In terms of split of revenues, we said earlier in the year that our split of revenues that we were projecting for this year between small screens and larger screens, TVs and small screens, I think we were 60% for the small mobile devices and about 40% for the others, mostly TVs. If anything, we think we're better positioned if there's an inflection that goes more strongly in OLED. Over time, we think there's probably more and more of that.

就收入分配而言，我們年初曾表示，我們預計今年的收入分配將在小螢幕和大螢幕（電視和小螢幕）之間分配，我認為小型行動裝置的收入佔 60%，其他裝置（主要是電視）的收入佔 40% 左右。如果有什麼變化的話，我們認為如果 OLED 出現更強勁的成長趨勢，我們反而會處於更有利的地位。隨著時間的推移，我們認為這種情況可能會越來越普遍。

Now, put in perspective, we are much better positioned than we were several years ago there in terms of products and breadth of products. There's about twice as many layers on an OLED devices as an LED screen. I think we're very well positioned. The inflection seems to be happening, but we haven't talked specific numbers. And it won't hit our revenue line right away, because these tools take about nine months to build.

現在，從整體來看，就產品種類和產品範圍而言，我們現在的地位比幾年前要好得多。OLED 設備的層數大約是 LED 螢幕的兩倍。我認為我們處於非常有利的地位。拐點似乎正在出現，但我們還沒有討論具體的數字。而且它不會立即對我們的收入產生影響，因為這些工具的開發大約需要九個月的時間。

Okay. Thank you.

好的。謝謝。

Your next question comes from the line of Krish Sankar from Bank of America Merrill Lynch. Your line is open.

你的下一個問題來自美國銀行美林證券的 Krish Sankar。您的線路已開通。

I have two of them. First one for Gary or Bob, it looks like everyone is bullish on 3D NAND, which makes sense, given the technology transition going on. I'm curious, when you look at the risks to it, where do you think we could be wrong in terms of 3D NAND growth? And along the path, have any of your customers actually looking at 2D NAND, at 12-nanometer or below, or do you think there's really no more 2D NAND development being done? And then I had a follow-up.

我有兩個。首先是給 Gary 或 Bob 的，看起來大家都看好 3D NAND，考慮到正在進行的技術轉型，這很合理。我很好奇，當你審視其中的風險時，你認為我們在 3D NAND 成長方面可能有哪些錯誤？那麼，您的客戶中是否有人真正關注過 12 奈米或更小的 2D NAND 晶片？或者您認為 2D NAND 晶片的研發真的已經停止了嗎？然後我還有後續跟進。

I think relative to 2D NAND, certainly when I'm spending time with customers, there's a tremendous competitive pressure to move to 3D NAND technology. So all the discussions -- I've met with many customers over the last few weeks. All of the discussions are focused on that transition. Not everybody is in the same place relative to the maturity or the yield for that technology, but I certainly see that as an overwhelming focus for all of the memory companies.

我認為相對於 2D NAND 而言，尤其是在我與客戶溝通時，我明顯感受到向 3D NAND 技術轉型的巨大競爭壓力。所以，所有這些討論——在過去的幾周里，我與許多客戶進行了會面。所有的討論都集中在這段過渡時期。並非所有公司都處於該技術成熟度或收益的同一階段，但我確實認為這是所有記憶體公司都非常關注的重點。

Got it. And then a follow-up on the display side. Looks like when you compare to your semi business, your served available market on display is pretty low. I understand that you're riding the OLED wave. Is there any plan to actually make the display like a $2 billion revenue business by organically and inorganically developing products so you can get a better percentage of the display CapEx?

知道了。接下來是關於顯示方面的後續問題。看起來，與你的半拖車業務相比，你所服務的可用市場相當低。我知道你們正在追趕OLED的潮流。是否有任何計劃，透過有機成長和非有機成長的方式開發產品，使顯示器業務真正發展成為年收入 20 億美元的業務，從而獲得更高的顯示器資本支出比例？

We've got, as we've talked about, really good momentum in OLED with a 3X larger TAM than we've had in the past. Bob talked about the number of steps increasing with CVD, PVD. We've entered thin-film encapsulation also, so that gives us another growth driver. We're very optimistic in terms of the growth opportunities in display. We are working on some other areas that would expand our TAM, but we're not ready to talk about those.

正如我們之前討論過的，我們在 OLED 領域取得了非常好的發展勢頭，市場規模是過去的 3 倍。Bob 談到 CVD、PVD 會導致步數增加。我們也涉足薄膜封裝領域，這為我們帶來了另一個成長動力。我們對顯示器領域的成長機會非常樂觀。我們正在研究一些其他領域，這些領域將擴大我們的潛在市場，但我們目前還不方便談論這些領域。

Got it. Thank you.

知道了。謝謝。

Your next question comes from the line of Farhan Ahmad from Credit Suisse. Your line is open.

你的下一個問題來自瑞士信貸的法爾漢·艾哈邁德。您的線路已開通。

Thanks for taking my question. Congratulations on solid results and guide. My first question is on 3D NAND. In your guidance of up 25%, can you tell us if you are including cross-point or any of the new memories in there? And secondly, if you could tell us what portion of the non-CapEx was 3D last year, and how much of it is on 3D this year?

謝謝您回答我的問題。恭喜你取得如此優異的成績和指導。我的第一個問題是關於3D NAND的。您給出的高達 25% 的指導意見中，是否包含了交叉點或任何新的記憶功能？其次，能否告知我們去年非資本支出中有多少是 3D 支出，今年又有多少是 3D 支出？

I can take on the cross point. Cross point still is really in the early phases, so really almost no CapEx for cross point in our forecast. What was the other question?

我可以承擔十字路口的責任。交叉點目前仍處於早期階段，因此我們的預測中幾乎沒有交叉點資本支出。另一個問題是什麼？

The other question was what portion of the CapEx within NAND is 3D in 2016, and what portion of it was 3D in 2015?

另一個問題是，2016 年 NAND 資本支出中有多少是 3D 的，2015 年又有多少是 3D 的？

We think in 2015, it was a little under 50% and we think in 2015 it's probably mid-80%s.

我們認為 2015 年這個數字略低於 50%，而 2016 年這個數字可能在 80% 左右。

Got it. And then one question on China. I wanted to probe a little bit more on China. There are two things we have seen from China. One is like we have seen new announced, fab announcements from new entrants.

知道了。然後還有一個關於中國的問題。我想更深入地了解中國。我們從中國看到了兩件事。一方面，我們看到了新進入者發布的精彩公告。

So I wanted to understand if you have seen any of the orders or any activity from new companies that are coming up in China, like XMC or some of the other memory companies that have been announced. Secondly, there have also been some large equity investments in some of the tech companies in US, from Chinese private equity companies. I want to hear if you have received any interest from any private equity firm in China?

所以我想了解一下，您是否注意到中國一些新興公司，例如 XMC 或其他一些已經宣布成立的記憶體公司，有任何訂單或活動。其次，一些中國私募股權公司也對美國的一些科技公司進行了大規模股權投資。我想了解您是否曾經收到來自中國任何私募股權公司的問詢？

So the first question, have we seen memory orders from new Chinese manufacturers in China?

所以第一個問題是，我們是否看到來自中國新興製造商的記憶體訂單？

Memory or interest like even activity, like joint development projects or R&D lines or any activity.

記憶力或興趣，甚至活動，例如共同開發專案或研發線或任何活動。

Let me try to help. Most of the activity we're seeing tactically is from existing customers. Existing customers in China already, and existing customers outside of China, who are increasing their footprint in China. We hear about people interested in technology and acquisitions, but we're not really involved in that.

讓我來幫忙。我們看到的大部分戰術活動都來自現有客戶。在中國已有的客戶，以及在中國以外正在擴大業務的現有客戶。我們聽說有人對技術和併購感興趣，但我們實際上並沒有涉足其中。

I would say we are engaged with some of these companies, but relative to business coming from those companies right now, it's very minimal. We are engaged with some companies that have future opportunities, but by far and away, the majority of the business today is from existing companies.

我想說，我們確實與其中一些公司有過接觸，但相對於目前來自這些公司的業務而言，接觸量非常少。我們正在與一些具有未來發展機會的公司進行洽談，但目前絕大多數業務仍來自現有公司。

Thank you. That's all I have.

謝謝。這就是我全部的資料了。

Your next question comes from the line of Harlan Sur from JPMorgan. Your line is open.

你的下一個問題來自摩根大通的哈蘭‧蘇爾。您的線路已開通。

Nice job on the quarter's execution, and the strong guide. On the foundry investment for this year, I think you were previously looking for slight growth for foundry this year and now you're guiding for flattish. I'm curious what's changed. Do you see a slower 10-nanometer conversion cycle, or maybe slightly lower 14 and 16-nanometer capacity adds? Any color here would be appreciated.

本季業績執行得不錯​​，業績指引強勁。關於今年的鑄造投資，我認為你預計今年鑄造行業會略有增長，而現在你預計會持平。我很想知道發生了什麼變化。您是否觀察到 10 奈米製程週期變慢，或者 14 奈米和 16 奈米製程的容量增加略有減少？這裡任何顏色都歡迎。

I don't think we've changed much, frankly. I think we are flattish, slightly up last time. We're flattish now. I don't think there's been much change, frankly. I wouldn't read too much into it.

坦白說，我認為我們並沒有發生太大變化。我認為我們目前處於平穩狀態，比上次略有上升。我們現在地勢比較平坦。坦白說，我認為並沒有太大變化。我不會過度解讀這件事。

There has been some change in mix.

成分發生了一些變化。

Yes, I think mix has changed a little bit. In other words, we think some of our foundry customers are more committed to spending, advance orders, some of the others seem to be hesitating. So we think the mix has changed a little bit from last quarter.

是的，我覺得混音風格稍微改變了一些。換句話說，我們認為我們的一些代工廠客戶更願意花錢，提前下訂單，而另一些客戶似乎還在猶豫。所以我們認為，與上個季度相比，產品組合發生了一些變化。

And those changes are also positive for us in 2016.

這些變化對我們2016年的發展也是正面的。

Got it, okay. And then on DRAM, you expect it to be more second-half weighted. Are you starting to see the 1X nanometer DRAM conversion in your pipeline for the second half of this year, and is this part of what's driving the second-half bias?

明白了，好的。至於DRAM，預計其成長將更集中在下半年。您是否開始在今年下半年的產品線中看到 1X 奈米 DRAM 的轉換？這是否是導致下半年產品線偏向的原因之一？

We see some of that happening this year, but we're not getting a lot of orders yet.

今年我們看到這種情況有所發生，但目前訂單量還不多。

But it is a big focus. There's no question, 1X is also another one of these competitive battlegrounds where there's a lot of focus.

但這是我們關注的重點。毫無疑問，1X 也是另一個備受關注的競爭激烈的戰場。

All right. Thanks a lot.

好的。多謝。

Your next question comes from the line of Steven Chin from UBS. Your line is open.

你的下一個問題來自瑞銀集團的 Steven Chin。您的線路已開通。

Gary and Bob, nice execution also in silicon. Just a follow-up question on China. Can you share your thoughts on the competitive landscape in semi cap equipment from local Chinese semi cap suppliers? Applied has been there for many years. Do you see any meaningful local Chinese semi cap competitors, different from other regions in the world?

Gary 和 Bob，矽晶片上的實作也很棒。關於中國，還有一個後續問題。您能否分享一下您對中國本土半導體設備供應商競爭格局的看法？Applied公司已經在那裡經營多年了。您認為中國本土有哪些與其他地區不同的、有競爭力的半導體公司？

As you said, we have been there for a long time. We have extremely strong relationships. I mean, certainly you have the -- some investment from multinationals moving to China, and the transitions that are happening there are areas where we have strong share, strong momentum. And the domestic companies that are there, we also have a very strong share position. Historically, those positions have been some of the best that we have within the Company, and that's really -- we expect to continue that outlook in 2016.

正如你所說，我們已經在那裡待了很久了。我們關係非常牢固。我的意思是，當然，一些跨國公司正在向中國投資，而中國正在發生的轉型，正是我們在這些領域擁有強大份額和強勁發展勢頭的領域。而且，對於已經進入這些市場的國內公司，我們也佔據了非常強大的市場。從歷史上看，這些職位一直是我們公司最好的職位之一，而且我們預計在 2016 年將繼續保持這種前景。

Okay. Thanks, Gary. Then just a follow-up question for Bob, on how to think about modeling gross margin in the second half of this year. It sounds like foundry customer mix is helping Applied's revenue in the second half of the year. But should we also think about that helping drive gross margin higher in the second half too, because of the favorable foundry customer mix? Thanks.

好的。謝謝你，加里。那麼，我還有一個後續問題要問鮑勃，關於如何考慮今年下半年的毛利率建模。看來晶圓代工客戶組合的變化有助於應用材料公司在下半年實現營收成長。但我們是否也應該考慮到，由於代工廠客戶組合的有利因素，這也有助於在下半年推高毛利率呢？謝謝。

Yes, it should help some. If you go look at why it would be up from the first half to the second half, it would be because some foundry mix, some cost reduction is helping us, and some is maturing of new tools. The thing that helped us a little bit ahead of schedule in the first half is we had some pull-in a little bit of some of the foundry customers, where we have -- this is some of the lagging node stuff, as much as anything, where we have strong share and positions. So foundry does help us generally, because it's -- the mix of tools is more advantageous for us there.

是的，應該會有一些幫助。如果你去探究為什麼產量從上半年到下半年有所成長，那是因為鑄造過程的調整、成本的降低以及新工具的成熟。上半年我們能夠提前完成部分進度，是因為我們爭取了一些代工廠客戶，尤其是在一些落後節點方面，我們擁有強大的市場份額和地位。所以鑄造廠總體上對我們有幫助，因為那裡的工具組合對我們來說更有利。

Okay. Thanks, Bob.

好的。謝謝你，鮑伯。

Your next question comes from the line of Patrick Ho from Stifel Nicolaus. Your line is open.

你的下一個問題來自 Stifel Nicolaus 的 Patrick Ho 的一句話。您的線路已開通。

Thank you very much. And congrats on a nice year. Bob, first on the display side, typically it's always had a little bit of a lower gross margins relative to your silicon system. As the transition to OLED begins, is there any potential, I guess, margin improvements you see with the product portfolio, and things that you have done on the display side of things?

非常感謝。恭喜你度過了美好的一年。鮑勃，首先說說顯示方面，通常來說，相對於你的矽系統，它的毛利率總是會稍微低一些。隨著向 OLED 過渡的開始，您認為產品組合以及您在顯示器方面所做的工作，是否有任何潛在的利潤提升空間？

Yes, I think display gross margins will improve over time. I think that in this year of early adoption, some of these new tools I think are okay and then they get better through the end of the year, into next year. The second thing which we talked about, I think on earlier calls is that the mix of tools we sell into small screens versus TVs, TVs is the sweet spot for us in terms of mix of tools and gross margins. It's a little bit different mix now that the smaller screen size, a little lower gross margins, as we mature our positions there, they should get pretty good. By the time we're done, you'll see gross margins more attractive in display over the next year or two.

是的，我認為隨著時間的推移，顯示器毛利率會提高。我認為在今年的早期應用階段，一些新工具可能還不錯，但到了年底甚至明年，它們會變得更好。第二點，我想我們在之前的電話會議中也討論過，那就是我們銷售給小螢幕和電視的工具組合，就工具組合和毛利率而言，電視是我們的最佳選擇。現在情況略有不同，螢幕尺寸變小，毛利率也略低，但隨著我們在該領域的地位日趨成熟，情況應該會好轉。到我們完成的時候，您將在未來一兩年內看到更具吸引力的毛利率。

Great. That's helpful. And Gary, maybe a question on bigger picture related to EUV, and potential capital intensity increases on future technology nodes on the logic end. Have you had any customer discussions that have highlighted, hey EUV could be further delayed, what are you going to do to help us out, and maybe potentially, especially since your models are based on EUV, getting the 7-nanometer logic node, maybe on a big picture basis, what are some of the additional incremental opportunities for Applied, if EUV misses this next node?

偉大的。那很有幫助。Gary，或許可以問一個關於 EUV 的更宏觀的問題，以及未來邏輯端技術節點可能出現的資本密集度增加的問題。您是否與客戶進行過任何討論，其中提到“EUV 可能會進一步延遲，你們打算如何幫助我們？特別是考慮到你們的模型是基於 EUV 的，能否獲得 7 奈米邏輯節點？從宏觀角度來看，如果 EUV 錯過了下一個節點，Applied 還有哪些額外的增量機會？”

Thanks for the question, Patrick. We have a number of very deep engagements with customers in patterning. Certainly patterning cost is one area that's a big focus. But also from a yield standpoint, edge placement errors are another area that is a big focus for customers. And this is another area where, again, the materials innovation, materials engineering, there are some really great opportunities for us.

謝謝你的提問，派崔克。我們在模式識別方面與客戶進行了許多非常深入的合作。當然，控製成本是重點關注的領域之一。但從良率的角度來看，邊緣放置誤差也是客戶非常關注的另一個領域。而這又是另一個領域，材料創新、材料工程，對我們來說有很多非常好的機會。

So as we continue to drive new capabilities with the new products that we've introduced over the last three years, the combinations of those products, we also see tremendous opportunity. So the engagements that we have with customers, I would say are, are further out, broader, deeper than we've ever had. This particular area is one that is a huge focus for all of our customers.

因此，隨著我們不斷透過過去三年推出的新產品推動新的功能，以及這些產品的組合，我們也看到了巨大的機會。因此，我認為我們與客戶的互動比以往任何時候都更加廣泛、深入和深入。這一領域是我們所有客戶都非常關注的重點。

Great. Thank you.

偉大的。謝謝。

Your next question comes from the line of [Sidney Hill] from Deutsche Bank. Your line is open.

你的下一個問題來自德意志銀行的[西德尼·希爾]。您的線路已開通。

Thanks for taking my questions. And congrats on the quarter and guide. My question is on the foundry side. With improved visibility of your 10-nanometer orders, do you think 10-nanometers will be a smaller node, similar to 20-nanometer, or is closer to full node? And related to that, how much of 10-nanometer capacity do you expect by the end of this calendar year? Lastly on this topic, what's the incremental equipment for 2016, 14 versus 10, and maybe between 10 versus 7? If you could give some color, that would be great.

謝謝您回答我的問題。恭喜你取得季度佳績並發布指導報告。我的問題是關於鑄造廠方面的。隨著 10 奈米訂單的可見度提高，您認為 10 奈米會是一個更小的節點，類似於 20 奈米，還是更接近完整的節點？與此相關的是，您預計到今年年底，10 奈米技術的產能將達到多少？最後，關於這個主題，2016 年的增量設備是多少？是 14 台對比 10 台，還是 10 台對比 7 台？如果能添加一些色彩就太好了。

Sure. Let me see if I can do this efficiently. Our customers tend to think of these as sister nodes now, 20, 16, 14, then 10,7 They do the interconnect more on the first leg, and they do the transistor stuff more on the second leg. They're thinking of them as, they tend to ramp quickly through the first leg, whether it be 20 or 10, to get to 16, 14 or 7, all right?

當然。我看看能不能有效率地完成這件事。我們的客戶現在傾向於將這些節點視為姊妹節點，即 20、16、14，然後是 10、7。它們在第一條腿上更多地進行互連，在第二條腿上更多地進行晶體管相關工作。他們認為，他們往往會在第一階段迅速加速，無論是 20 還是 10，以達到 16、14 或 7，明白嗎？

And so my guess, 10 won't be a long node. They are obviously going to start doing parallel work on 7, and so it won't be a long node. The total node of 10, 7, the sister might be an attractive node. But they are going to get to 7. Okay. That's step one and two.

所以我猜測，10 不會是一個很長的節點。他們顯然會在 7 號節點上開始並行工作，所以它不會是一個很長的節點。總節點數為 10、7，姊妹節點可能是一個有吸引力的節點。但他們肯定會達到7。好的。這是第一步和第二步。

In terms of comparing 20 to 16, 14 to 10, 7 there are differences. You have to look at what the backfill is from the previous node on a lot of this stuff. So if you look at 20-nanometer, they chose interconnect, but it was the last planar transistor. It wasn't a finFET, right?

如果將 20 與 16、14 與 10、7 進行比較，就會發現它們之間存在差異。很多這類問題都需要查看前一個節點的回填內容。所以，如果你看看 20 奈米工藝，他們選擇了互連技術，但那是最後一個平面電晶體。它不是鰭式場效電晶體（FinFET），對吧？

So the attractiveness in terms of processing power and battery, processing speed and battery is a lot better on a finFET, so that you didn't have a lot of people pulled to go to 20, they waited to 16. You don't have that disadvantage when you're going from 16 to 10, so there will be a lot of tape-outs coming from 16 from people that went from 28 and so forth. You're not going to have this backfill gap you had at 20. Point number one -- 10, 7 are probably attractive, they'll get through 10 pretty aggressively. You won't have as big a gap as you had at 20 because 16 will backfill and tape-outs will increase.

因此，就處理能力和電池而言，FinFET 的吸引力要好得多，所以並沒有很多人被吸引到 20，他們都等到了 16。從 16 級降到 10 級就沒有這種劣勢了，所以會有很多從 28 級降到 10 級的人跑出 16 級的成績。你不會再像20歲時那樣出現填補空缺的情況了。第一點——10、7 可能很有吸引力，他們會非常積極地完成 10 項任務。你不會像 20 歲時那樣出現那麼大的差距，因為 16 會回填，膠帶的延伸也會增加。

Great. Switching to a different subject, how should we think about your buybacks in the April quarter, now you're down to roughly $1 billion remaining authorization? Are you restricted somehow by a domestic cash balance to do more buybacks beyond the existing program?

偉大的。換個話題，鑑於你們目前剩餘的授權額度約為 10 億美元，我們該如何看待你們在 4 月季度的股票回購計畫？國內現金餘額是否限制了您在現有計劃之外進行更多股票回購？

Sure. The total authorized buyback was $3 billion through the end of fiscal Q1. We had done $1.950 billion, so we have $1.050 billion left on the existing authorization. The way we execute the authorization is we look at multiple valuation metrics for the Company and we set up a table. If the stock price is attractive, based on frankly longer-term metrics, then we will buy stock.

當然。截至第一財季末，已核准的回購總額為 30 億美元。我們已經完成了 19.5 億美元，所以在現有授權範圍內還剩下 10.5 億美元。我們執行授權的方式是，我們會查看公司的多個估值指標，並建立表格。如果從長期指標來看，股價有吸引力，那麼我們就會買入股票。

So we pretty aggressively bought stock the last three quarters. We started to get a little bit tight on US-sourced cash in September, so what we did was we were able to trigger some $800 million of cash as a repatriation of capital without paying tax, and secondly, we raised some money through debt. Right now, about 50% of our cash is on shore at the end of the fiscal quarter.

所以過去三個季度我們相當積極地買入了股票。9 月份，我們在美國境內的現金開始有些緊張，所以我們採取的措施是，我們能夠觸發大約 8 億美元的現金作為資本回流而無需繳稅，其次，我們透過債務籌集了一些資金。目前，在每個財政季度末，我們約有 50% 的現金在境內。

So we think we have enough cash to execute the buyback. And then if we want to continue, we are committed to long-term cash returns to shareholders, through dividends and buyback. If we want to continue to buy back after discussion with the Board, we believe we can find other sources of cash.

所以我們認為我們有足夠的現金來執行回購計劃。如果我們想繼續發展，我們將致力於透過股利和股票回購為股東帶來長期現金回報。如果與董事會討論後我們想繼續回購股票，我們相信我們可以找到其他資金來源。

Okay, great. Thanks so much.

好的，太好了。非常感謝。

Your next question comes from the line of Weston Twigg from Pacific Crest. Your line is open.

你的下一個問題來自太平洋山脊的韋斯頓·特威格家族。您的線路已開通。

I just have a couple of questions. First, operating expenses looked like they are creeping up a little, based on the guidance. Just wondering if you think that flattens out moving forward or if that grows a bit more in the second half?

我只有幾個問題。首先，根據指引來看，營運費用似乎略有上升。我只是想知道你認為這種情況會在接下來的時間裡趨於平緩，還是會在下半程有所增長？

Yes, we said -- we're about $5 million over in Q1, about $5 million over the midpoint in Q2. So I think we're a $5 million over model for a quarter or two, but I think we're pretty much holding the line.

是的，我們說過——第一季我們超支了大約 500 萬美元，第二季我們超支了大約 500 萬美元（按季度中點計算）。所以我認為我們未來一兩個季度的盈餘將達到 500 萬美元，但我覺得我們基本上能守住盈餘。

Did you say 555 or 565 for Q2?

你第二季說的是555還是565？

I think we're flat from Q2 forward.

我認為從第二季開始，我們的情況將趨於平穩。

Okay. The other question is just related to the inspection segment. You have a new UVision tool, a new optical tool. KLA had a pretty good quarter and outlook, they had orders up 26% last quarter and they have a new inspection platform launching this year. You said you'll get more aggressive in that segment. I'm wondering if you can walk us through what you think happens in the inspection segment. Do you think you can gain some share or grow your SAM this year, or is it more of a 2017 event?

好的。另一個問題只與檢驗環節有關。您現在擁有了全新的UVision工具，一款全新的光學工具。KLA本季業績和前景都相當不錯，上季訂單成長了26%，今年將推出一個新的檢測平台。你說過你會在這個領域採取更積極的策略。我想請您詳細介紹一下您認為檢查環節會發生什麼。您認為今年能否獲得一些市場份額或擴大您的SAM（銷售和市場規模）？還是說這更可能要等到2017年？

Yes, we're pretty optimistic on wafer inspection in our view for 2016. Our UVision Brightfield tool has a good position in foundry and logic. Last quarter we talked about receiving our first revenue for our new e-beam inspection platform in both memory and foundry.

是的，我們對2016年晶圓檢測的前景相當樂觀。我們的 UVision Brightfield 工具在晶圓代工和邏輯電路領域佔有一席之地。上個季度我們談到了我們的新型電子束檢測平台在記憶體和晶圓代工領域獲得首筆收入。

e-beam technology is the largest part of PDC revenue, our PDC division. We're number one in e-beam review. Now taking that technology into an inspection where we have significant pull from customers. So I think overall in 2016, we're pretty optimistic about that business.

電子束技術是PDC（我們的PDC部門）收入的最大組成部分。我們在電子束檢波領域排名第一。現在，我們將這項技術應用到檢測領域，而檢測領域正是我們擁有龐大客戶需求的領域。所以我認為整體而言，我們對2016年的業務前景相當樂觀。

Okay. Good. Thank you.

好的。好的。謝謝。

Thanks, Weston. Operator, I think we have time for two more questions, please.

謝謝你，韋斯頓。接線員，我想我們還有時間再問兩個問題，謝謝。

Your next question comes from the line of Tom Diffely from D.A. Davidson. Your line is open.

你的下一個問題來自 D.A. Davidson 的 Tom Diffely 的一句話。您的線路已開通。

Quick question on the mature side of the business. What is your view right now for 200-millimeter business this year, and what impact does that have on margins in general?

關於公司成熟業務方面，我有個小問題。您目前對今年 200 毫米鏡頭事業的看法如何？這對整體利潤率有何影響？

200-millimeter business ticked up last year, 200-millimeter business is driven mostly for things like sensors, CIF devices. There is a growing content of those in your mobile devices, and also in things like automobiles. Last year spiked up, as they added capacity. We think sales of 200-millimeter tools this year might be down a little bit, but healthy.

去年 200 毫米業務有所成長，200 毫米業務主要由感測器、CIF 設備等驅動。你的行動裝置中，以及汽車等物品中，這類內容都在不斷增加。去年由於產能增加，價格出現了飆漲。我們認為今年 200 毫米工具的銷量可能會略有下降，但整體情況良好。

Okay. Over the next few years, do you think that's still an IoT growth market for you?

好的。在未來幾年，您認為這仍然是物聯網成長市場嗎？

Generally speaking, we're positive on IoT growth in sensors and things like that. How it translates into used 200-millimeter tool sales, we're not sure past this year.

總的來說，我們對物聯網在感測器等領域的成長持樂觀態度。明年以後，這種趨勢將如何影響二手 200 毫米工具的銷量，我們還不確定。

I would say those, the other way for processing CIS, CMOS image sensors, power devices, RF sensors, all of those areas are definitely areas of growth, and some we're seeing in China, with some of the business incrementally in 2016, but definitely that will continue to grow. Whether it's 200-millimeter or 300-millimeter, I think that -- it may not be 200-millimeter far into the future. But certainly, that is definitely an area of growth and opportunity for Applied.

我會說，另一方面，對於 CIS、CMOS 影像感測器、功率元件、射頻感測器等處理領域，所有這些領域肯定都是成長領域，我們在中國已經看到一些成長，2016 年的一些業務是逐步成長的，但肯定會繼續成長。無論是 200 毫米還是 300 毫米，我認為——在不久的將來可能不會是 200 毫米。但可以肯定的是，這絕對是應用科技的一個成長和機會領域。

Okay. Thank you.

好的。謝謝。

Your last question comes from the line of Mark Heller from CLSA. Your line is open.

你的最後一個問題來自里昂證券的馬克海勒。您的線路已開通。

Thanks for squeezing me in. Two questions on OLED. I guess first, on the display business you're guiding down I think 20% to 30% on revenues for the April quarter. I was wondering if you could give any color on expectations for display orders in the April quarter?

謝謝你擠出時間陪我。關於OLED的兩個問題。首先，關於顯示器業務，你們預計4月季度的營收將下降20%至30%。我想請問您能否透露一下對四月季度展示品訂單的預期？

Again, these tools take nine months to build, Mark, so I wouldn't read too much into the Q2. I think that the general direction is positive, and our position is positive on display. So I think I wouldn't read too much into Q2. That's more of a result of what we booked six to nine months ago.

馬克，再說一遍，這些工具需要九個月的時間才能開發出來，所以我不會對第二季的結果過度解讀。我認為整體方向是正面的，我們目前所處的位置也展現了正面的優勢。所以我認為不必對第二季的問題過度解讀。這更多是我們六到九個月前預訂的結果。

Okay. But any color on direction of orders for the April quarter for display?

好的。但對於四月季度的展銷訂單方向，是否有任何消息？

We don't usually guide explicit orders, but we're directionally positive.

我們通常不會給出明確的指示，但我們的方向是積極的。

Okay. And then it sounds like most of the interest or activity is on small screen displays, but I was wondering if you have any thoughts on OLED TV, pickup in investment there.

好的。聽起來大部分興趣或活動都集中在小螢幕顯示器上，但我很好奇您對OLED電視有什麼看法，以及是否值得投資。

Certainly the big inflection right now is in mobile, and we see tremendous opportunity there. TVs is really a longer-term opportunity.

目前最大的轉折點無疑在行動領域，我們看到了那裡的巨大機會。電視行業確實是一個更長遠的機會。

Okay. Great. Thank you.

好的。偉大的。謝謝。

Thanks, Mark, for your question. We would like to thank everyone for joining us this afternoon. A replay of this call will be available on our website beginning at 5:00 PM Pacific time today. Thank you for your continued interest in Applied Materials.

謝謝你的提問，馬克。感謝各位今天下午蒞臨。本次電話會議的錄音重播將於今天太平洋時間下午 5:00 起在我們的網站上提供。感謝您一直以來對應用材料公司的關注。

This concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連線了。