應用材料 (AMAT) 2017 Q1 法說會逐字稿

Good afternoon, everyone. I'm Michael Sullivan, Head of Investor Relations at Applied Materials. We appreciate you joining us for our first quarter of FY17 earnings conference call, which is being recorded. Joining me are Gary Dickerson, our President and CEO, and Bob Halliday, our Chief Financial Officer.

大家下午好。我是應用材料公司投資者關係主管麥可·沙利文。感謝您參加我們2017財年第一季業績電話會議，本次會議正在錄音。與我一同出席的還有我們的總裁兼執行長加里·迪克森，以及我們的財務長鮑勃·哈利迪。

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, revenue growth, 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.

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、收入增長、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，並且不構成對未來績效的保證。

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 15, 2017, and Applied assumes no obligation to update them.

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 2017 年 2 月 15 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 investor relations page of our website at AppliedMaterials.com. And now I'd 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 的投資者關係頁面上找到。現在我想把電話交給加里·迪克森。

Thanks, Mike. I'm happy to report that Applied Materials delivered another record quarter in Q1. With earnings and orders exceeding all-time highs, 2017 is shaping up to be an outstanding year. As I look ahead, I see broad-based strength in our markets as large, multi-year inflections evolve and new, emerging demand drivers layer on top of mobility and computing. I'm also increasingly confident that Applied is positioned to sustainably grow faster than our markets as we realize the benefits of the investments we have been making in our organization and product pipeline.

謝謝你，麥克。我很高興地報告，應用材料公司在第一季再次創下業績新高。2017 年，公司獲利和訂單量均創歷史新高，並有望成為輝煌的一年。展望未來，隨著多年期重大轉折點的出現，以及新興需求驅動因素在行動性和運算領域不斷疊加，我認為我們的市場將呈現全面且強勁的態勢。隨著我們對公司組織和產品線的投資逐漸取得成效，我也越來越有信心，Applied 能夠實現比市場更快的永續成長。

On today's call, I will begin with a quick recap of our strategy and provide an update on the key trends and industry inflections that are driving our growth. I'll then translate these into an outlook for Applied's markets before concluding with a brief overview for each of our businesses. After that, Bob will provide additional details about our performance and his perspective on 2017 and beyond.

在今天的電話會議上，我將首先快速回顧我們的策略，並介紹推動我們成長的關鍵趨勢和產業轉折點的最新情況。接下來，我將把這些內容轉化為對應用材料市場前景的展望，最後簡要概述我們各項業務。之後，鮑伯將提供更多關於我們表現的細節以及他對 2017 年及以後的看法。

The significant changes in semiconductor and display technology that are taking place today depend on materials innovation. At Applied, our strategy is to deliver innovative materials engineering technologies to enable these major inflections. Across the Company, we are focused on extending our innovation leadership and delivering solutions that enable customers to build new devices and structures that were never possible before.

當今半導體和顯示技術領域發生的重大變化取決於材料創新。在應用材料公司，我們的策略是提供創新的材料工程技術，以實現這些重大變革。公司上下致力於擴大創新領先地位，並提供解決方案，使客戶能夠建造以前從未實現過的新設備和結構。

As I have outlined previously, there are five large, multi-year inflections that are underpinning our record performance today, and we believe will fuel our growth for years to come. I'm going to take a few minutes to provide an update on each of these drivers as well as describe how our strategy of inflection-focused innovation positions Applied for sustainable profitable growth.

正如我之前概述的那樣，支撐我們今天創紀錄業績的五大、多年轉折點，以及我們相信將在未來幾年推動我們成長的因素，都至關重要。我將花幾分鐘時間介紹這些驅動因素的最新情況，並闡述我們以轉折點為中心的創新策略如何使 Applied 實現可持續的獲利成長。

Let me begin with 10- and 7-nanometer technologies in foundry and logic. We are seeing significant investments by our customers to meet demand for leading-edge silicon to power increasingly capable mobile devices, 4K video, and new compute-intensive applications like artificial intelligence and smart vehicles. This sustained investment in advanced technology plays to the strength of our leadership businesses where we have unique capabilities and high market share.

讓我先從晶圓代工和邏輯電路中的 10 奈米和 7 奈米技術談起。我們看到客戶進行了大量投資，以滿足對尖端晶片的需求，這些晶片能夠為功能日益強大的行動裝置、4K 視訊以及人工智慧和智慧汽車等運算密集型應用提供動力。對先進技術的持續投資，發揮了我們領先業務的優勢，我們在這些業務領域擁有獨特的能力和較高的市場份額。

The second driver is 3D NAND, which is a great example of materials-enabled scaling. We believe NAND bit demand grew about 45% in 2016 and that 2017 will be similar. Major memory companies are saying this growth rate is sustainable over the next several years.

第二個驅動因素是 3D NAND，這是材料賦能的規模化發展的絕佳例證。我們認為 2016 年 NAND 位需求成長了約 45%，2017 年的情況也類似。主要記憶體公司表示，這種成長速度在未來幾年內是可持續的。

Our opportunity in NAND is also expanding. While 3D NAND has significant performance and power advantages, the bit density increase achieved moving from generation to generation is slower than it was for planar NAND. To compensate, more wafer starts are needed.

我們在NAND領域的機會也在不斷擴大。雖然 3D NAND 在效能和功耗方面具有顯著優勢，但其從一代到一代的比特密度成長速度比平面 NAND 慢。為了彌補這一不足，需要增加晶圓開工量。

The third driver for Applied is patterning, a market which is growing rapidly. It's important to recognize that as customers move to smaller chip geometries, all the layers in the device scale. Some layers will move to EUV and others to multi-patterning. This means that even in the most aggressive EUV adoption case, our patterning opportunity still expands considerably. Patterning is an area where Applied is making significant investments. We increased our patterning revenues more than 60% in 2016, and we have significant room to grow.

應用科技的第三個驅動力是圖案設計，這是一個快速成長的市場。需要注意的是，隨著客戶轉向更小的晶片幾何尺寸，設備中的所有層都會縮小。部分層將採用極紫外光刻技術，其他層將採用多重曝光技術。這意味著即使在最激進的 EUV 採用情況下，我們的圖案化機會仍然會大幅擴大。應用材料公司在圖案設計領域投入了大量資金。2016 年，我們的圖案設計收入成長了 60% 以上，而且我們還有很大的成長空間。

Beyond semiconductor, another unique growth driver for Applied is advanced display, where two major market inflections are underway. The first is rapid growth in large-format TVs, 60 inches and above, which is driving investment in new Gen 10.5 capacity, as customers optimize factories for bigger screen sizes. We're now tracking seven Gen 10.5 projects.

除了半導體之外，Applied 的另一個獨特的成長動力是先進顯示器，該領域正在經歷兩個主要的市場轉折點。首先是 60 吋及以上大尺寸電視的快速成長，這推動了對第 10.5 代新產能的投資，因為客戶正在優化工廠以適應更大的螢幕尺寸。我們目前正在追蹤七個 Gen 10.5 項目​​。

In parallel, there is a battle for leadership in next-generation mobile screens, and demand for OLED manufacturing equipment is broadening. We see half of this demand coming from new entrants. As a result, in the past few months our view of display spending has strengthened further. We now see customers increasing their investments by around $3 billion in 2017, $1 billion more than we thought in November. Our early view of 2018 is also positive.

同時，下一代行動螢幕的領導地位之爭也在進行，對 OLED 製造設備的需求也不斷擴大。我們發現，這其中一半的需求來自新進者。因此，在過去的幾個月裡，我們對展示廣告支出的看法進一步增強。我們現在看到客戶在 2017 年增加了約 30 億美元的投資，比我們在 11 月的預期多了 10 億美元。我們對2018年的初步看法也是正面的。

The fifth driver I will cover is China, which is an important long-term growth opportunity for Applied in both semiconductor and display. While we believe 2017 spending will be similar to last year, based on the new factory projects we are tracking, we expect to see a significant ramp in investment in 2018 and beyond.

我要介紹的第五個驅動因素是中國，對於應用半導體和顯示器領域而言，中國是一個重要的長期成長機會。雖然我們認為 2017 年的支出將與去年類似，但根據我們追蹤的新工廠項目，我們預計 2018 年及以後的投資將大幅增加。

Now I'll translate these major inflections into our market outlook. Due to strong shipments in December, we now believe 2016 wafer fab equipment spending ended the year at around $35 billion. We expect 2017 to be higher still, up 5% or more year on year. Within this spending we see strength across the board, with foundry, NAND, DRAM, and logic investments all growing relative to 2016.

現在我將把這些重大轉折點轉化為我們的市場展望。由於 12 月出貨量強勁，我們現在認為 2016 年晶圓製造設備支出最終約為 350 億美元。我們預計 2017 年的成長速度會更快，年增 5% 或更多。在這些支出中，我們看到了全面強勁的成長，晶圓代工、NAND快閃記憶體、DRAM和邏輯電路的投資都比2016年有所成長。

Our early view of 2018 wafer fab equipment is also positive for a number of reasons. We see foundry investment broadening. We believe memory fundamentals will remain strong, fueled by explosive growth in data and investment in new technologies. When we look at customers' total capital spending, we see healthy investment in new factory shells, and we expect spending in China to accelerate in 2018 and beyond.

基於多種原因，我們對 2018 年晶圓製造設備的初步看法也是正面的。我們看到代工領域的投資範圍正在擴大。我們相信，在數據爆炸性成長和對新技術投資的推動下，記憶體市場的基本面將保持強勁。當我們查看客戶的總資本支出時，我們發現對新廠房的投資相當可觀，我們預計 2018 年及以後在中國的支出將會加速成長。

Looking to the future we are increasingly excited about trends in virtual and augmented reality, big data, and artificial intelligence and smart vehicles. These new applications require major advances in silicon and display technology and create huge demand for memory. These new drivers layer on top of existing demand for mobility, PCs, and other consumer electronics and have the potential to fuel a new phase of industry growth. All of this reinforces our perspective that our markets are becoming stronger and less cyclical.

展望未來，我們對虛擬實境和擴增實境、大數據、人工智慧和智慧汽車等領域的發展趨勢越來越感到興奮。這些新應用需要矽技術和顯示技術取得重大進步，並對記憶體產生巨大需求。這些新的驅動因素疊加在現有的行動裝置、個人電腦和其他消費性電子產品的需求之上，並有可能推動產業進入新的成長階段。所有這些都強化了我們的觀點，即我們的市場正變得越來越強勁，週期性波動越來越小。

I'll now provide a brief update on each of our major businesses. In semiconductor, 2016 was a big share gain year for Applied. While we'll wait for Gartner's final sizing in April before providing all the details, we believe we've gained around 2 points of overall wafer fab equipment share. These gains are broad-based, with especially strong adoption of our new products.

接下來我將簡單介紹我們各項主要業務的最新進展。在半導體領域，2016年是應用材料公司市佔率大幅成長的一年。雖然我們會等到 Gartner 在 4 月發布最終規模報告後再提供所有細節，但我們相信我們在晶圓製造設備總份額方面已經獲得了大約 2 個百分點。這些收益是廣泛性的，尤其體現在我們新產品的強勁普及上。

In 2016 about 40% of our revenue came from products that we have launched in the past three years. We have great momentum and fully expect to add to these gains in 2017. In our first quarter, semi equipment revenue and orders were at a 16-year high, with our highest orders ever in etch, [CVD], and process diagnostics and control.

2016 年，我們約有 40% 的營收來自過去三年推出的產品。我們目前發展勢頭強勁，完全有信心在 2017 年取得更大成就。第一季度，半導體設備收入和訂單達到 16 年來的最高水平，其中蝕刻、[CVD] 以及製程診斷和控制的訂單量創歷史新高。

In display, we delivered another strong quarter of revenue and orders. Since 2012 we have grown display revenues around 20% per year, and we believe we will book $2 billion of orders in 2017. As display technology becomes more complex, we are focused on building out our product portfolio to deliver the solutions our customers need. We have great traction with our new thin-film encapsulation and eBeam review products and have more significant new products that we will announce later this year.

在展示品業務方面，我們又實現了強勁的季度營收和訂單量。自 2012 年以來，我們的顯示器收入每年增長約 20%，我們相信 2017 年的訂單金額將達到 20 億美元。隨著顯示技術變得越來越複雜，我們致力於拓展產品組合，以提供客戶所需的解決方案。我們的新型薄膜封裝和電子束檢測產品取得了巨大的成功，今年稍後我們將發布更多重要的新產品。

In service, our strategy is to deliver more value to customers with our advanced service products. We are focused on reducing ramp time, improving device performance and yield, and optimizing output and operating costs for our customers. We are seeing the impact of our investments and are increasing our share of the service opportunity. On a year-on-year basis we now have grown our service business for 13 consecutive quarters, and our orders in Q1 were also an all-time high.

在服務方面，我們的策略是透過我們先進的服務產品為客戶創造更多價值。我們致力於縮短啟動時間，提高設備效能和良率，並優化客戶的產量和營運成本。我們正在看到投資的影響，並且正在增加我們在服務市場中的份額。從年比來看，我們的服務業務已經連續 13 個季度實現成長，而且第一季的訂單量也創下歷史新高。

Before I hand the call over to Bob, let me quickly summarize. Q1 was another record-breaking quarter, and we expect 2017 to be an outstanding year for the Company. The large, multi-year inflections that are driving our business remain firmly in place, and our markets are growing and becoming less cyclical. We expect wafer fab equipment and display investments to be up in 2017, and our initial view of 2018 is also positive.

在把電話交給鮑伯之前，讓我快速總結一下。第一季又是一個破紀錄的季度，我們預期 2017 年將是公司業績斐然的一年。推動我們業務發展的多年重大轉折點依然穩固，我們的市場正在成長，週期性波動也越來越小。我們預計 2017 年晶圓製造設備和顯示器投資將會增加，我們對 2018 年的初步看法也是正面的。

Our inflection-focused innovation strategy is delivering results. We are outperforming in semiconductor with strong share gains, sustainably growing our service business, and we are uniquely positioned to drive significant growth in display. Overall we are increasingly confident that we can maintain our trajectory of sustainable growth and raise the ceiling on our performance. Now I will ask Bob to provide more details about our results and outlook. Bob?

我們以轉折點為導向的創新策略正在發揮成效。我們在半導體領域表現出色，市場佔有率大幅成長，服務業務也持續成長，我們擁有獨特的優勢，能夠推動顯示器領域的顯著成長。總體而言，我們越來越有信心能夠保持可持續成長的勢頭，並提高業績上限。現在我將請鮑伯提供更多關於我們業績和前景的細節。鮑伯？

Thanks, Gary. Applied's momentum continues in the new fiscal year, with record orders and earnings both up substantially from a year ago. And we're guiding for new revenue and earnings records in Q2. For investors with a long memory, this kind of performance raises old questions about peaks and sustainability. However, I'm confident that our markets are materially better, and I believe that Applied's ability to deliver value and profitability is increasingly stronger and more sustainable.

謝謝你，加里。應用材料公司在新財年持續維持成長勢頭，訂單量和收益均創歷史新高，較上年同期大幅成長。我們預計第二季營收和獲利將創下新紀錄。對於記憶力好的投資者來說，這種表現會引發人們對市場高峰和永續性的老問題。但是，我相信我們的市場狀況已經顯著改善，而且我相信應用科技創造價值和盈利的能力也越來越強，越來越可持續。

Last quarter I gave you numbers showing that the industry is now larger and significantly less volatile. Some of you did the math and saw that this is true. I believe investors will come to recognize that the industry truly is more attractive, owing to three important factors.

上個季度我曾向你們提供數據，顯示該產業現在規模更大，波動性也顯著降低。你們當中有些人算了一下，發現這是真的。我相信投資者會逐漸認識到，由於以下三個重要因素，該行業確實更具吸引力。

First is that our customers have fully absorbed a tremendous amount of productivity. The list includes the 300-millimeter wafer size transition, cycle time reductions, supplier consolidation including the IDM to foundry transitions, the shift to highly productive mega fabs, better inventory management, reuse strategies, and disciplined profit-minded investment by our customers.

首先，我們的客戶已經充分吸收了大量的生產力提升。該清單包括 300 毫米晶圓尺寸過渡、週期時間縮短、供應商整合（包括 IDM 向代工廠的過渡）、向高生產力巨型晶圓廠的轉變、更好的庫存管理、再利用策略以及客戶有條不紊的以盈利為目的的投資。

Second is capital intensity. A steadily rising amount of capital equipment is needed to build each type of chip, and customers increasingly need the kind of equipment Applied makes. For example, patenting smaller lines takes more CVD, CMP, and etch steps. Logic and foundry chips need more metal layers and new materials, and 3D NAND memories add bits at a slower rate than 2D shrinks. You can see these factors playing out in the capital intensity curves of the industry.

其次是資本密集度。製造每種類型的晶片都需要越來越多的資本設備，而客戶也越來越需要 Applied 生產的那種設備。例如，申請較小線路的專利需要更多的 CVD、CMP 和蝕刻步驟。邏輯晶片和代工晶片需要更多的金屬層和新材料，而 3D NAND 記憶體增加位元的速度比 2D 縮小的速度要慢。你可以在產業的資本密集度曲線中看到這些因素的影響。

Third is that we are seeing more demand drivers. In NAND, server farms are early in the transition from hard disk to solid-state drives. In logic and foundry, leading technology and automotive companies are designing custom, high-performance chips for artificial intelligence.

第三，我們看到需求驅動因素越來越多。在 NAND 領域，伺服器叢集正處於從硬碟過渡到固態硬碟的早期階段。在邏輯晶片和晶圓代工領域，領先的科技公司和汽車公司正在為人工智慧設計客製化的高性能晶片。

Manufacturers are adding sensors, intelligence, and communications into all kinds of commercial and consumer products, creating the Internet of Things. The additional data that is being created drives further demand for advanced processors and memory, and we have many engagements with new companies in China who are strategically committed to participating in future waves of growth.

製造商正在將感測器、智慧和通訊功能添加到各種商業和消費產品中，從而創造了物聯網。不斷產生的新數據進一步推動了對先進處理器和記憶體的需求，我們與中國許多新興公司建立了合作關係，這些公司都致力於參與未來的成長浪潮。

Gary mentioned that we expect WFE spending to be up by over 5% this year, which would give us the highest level of investment seen to date. 2017 investment does not include a wafer size transition, as in 2000, or a surge in commodity DRAM investment, as in 2007, or an unusually large year of MOCVD spending, as in 2011. In fact, I believe our 2017 forecast reflects measured, prudent customer spending designed to meet strong demand patterns that we are seeing continue into 2018 and beyond.

Gary提到，我們預計今年WFE支出將成長超過5%，這將使我們獲得迄今為止最高的投資水準。2017 年的投資不包括像 2000 年那樣的晶圓尺寸轉型，也不包括像 2007 年那樣的商品 DRAM 投資激增，或者像 2011 年那樣的 MOCVD 支出異常龐大的一年。事實上，我認為我們 2017 年的預測反映了審慎穩健的客戶支出，旨在滿足我們看到的將持續到 2018 年及以後的強勁需求模式。

Our customers will continue to benefit from making big investments in leading-edge capacity to power devices and the cloud. I believe concerns about the cost benefit of Moore's Law are anchored on the value of yesterday's applications. Consider the value being created by companies who are using technology to transform industries like advertising, retailing, transportation, television, and travel. Today they are making massive investments in new applications that depend on further innovations in processors, memories, and displays and a lot more capacity. I see a very healthy future in this for Applied Materials.

我們的客戶將繼續受益於我們在尖端產能方面的大量投資，這些產能將用於為設備和雲端提供支援。我認為人們對摩爾定律成本效益的擔憂源於對過去應用價值的擔憂。想想那些利用科技改變廣告、零售、交通、電視和旅遊等產業的公司所創造的價值。如今，他們正對依賴處理器、記憶體、顯示器以及更大容量的新型應用程式進行大規模投資。我認為應用材料公司在這方面有非常良好的發展前景。

At Applied, we changed the investment model to deliver higher returns. We aggressively shifted dollars from G&A to R&D and from sustaining R&D to impactful new product R&D. We significantly increased the percentage of winning products, and we accelerated our new product development time line. These trends have multiplicative effects and our continuing. As a result, we are outperforming our markets and benefiting from delivering more valuable products and services to our customers.

在應用科技公司，我們改變了投資模式，以實現更高的回報。我們積極地將資金從一般及行政費用轉移到研發，並將資金從維持性研發轉移到具有影響力的新產品研發。我們大幅提高了中標產品的比例，並加快了新產品開發進度。這些趨勢具有倍增效應，而且我們仍在繼續。因此，我們的業績優於市場平均水平，並且透過向客戶提供更有價值的產品和服務而受益。

Let's start with revenue growth. As Gary said, we expect WFE spending to grow by around 5% or more in calendar 2017. In FY17, we anticipate that our services group will grow at twice that rate, our semiconductor systems business will grow at 4 times that rate, and our display business will grow at more than 10 times that rate. As a result, we are gaining share in our markets.

我們先從營收成長說起。正如 Gary 所說，我們預計 2017 年 WFE 支出將增加 5% 或更多。預計在 2017 財年，我們的服務集團將以兩倍的速度成長，半導體系統業務將以四倍的速度成長，顯示器業務將以十倍以上的速度成長。因此，我們在市場佔有率方面不斷擴大。

The best indication of the value we provide is profit margins. Our non-GAAP gross margin was 45.4% in Q1, the second highest since 2008. Our non-GAAP operating margin was 26%, a nine-year high. And next quarter we plan to be higher in both.

衡量我們所創造價值的最佳指標是利潤率。第一季我們的非GAAP毛利率為45.4%，是2008年以來的第二高。我們的非GAAP營業利益率為26%，創九年來新高。我們計劃下個季度這兩項指標都能有所提升。

Our revenue growth and margin expansion are resulting in strong free cash flow, which grew by more than 300% in Q1 from the same period last year, and we are committed to returning excess cash to shareholders. In addition, we are closely monitoring the policy environment. As a US-based manufacturer with strong exports and a global manufacturing network, we have a great deal of flexibility in adapting to the new policies being considered.

我們的營收成長和利潤率擴張帶來了強勁的自由現金流，第一季自由現金流比去年同期成長了 300% 以上，我們致力於將多餘的現金回饋給股東。此外，我們正在密切關注政策環境。作為一家總部位於美國、出口實力雄厚且擁有全球製造網絡的製造商，我們在適應正在考慮的新政策方面具有很大的靈活性。

Next I'll comment on our performance during Q1 as compared to the same period last year. Orders of $4.2 billion were our highest ever and broad-based. We had a 16-year high in semiconductor systems orders, record orders in services, and very strong display orders of $632 million. In Q1 we grew company revenue by 45% and increased non-GAAP gross margin by 300 basis points.

接下來，我將對我們第一季的業績與去年同期相比的情況進行評論。訂單總額達 42 億美元，創歷史新高，且涵蓋範圍廣泛。我們在半導體系統訂單方面取得了 16 年來的最高成就，服務訂單方面也創下了紀錄，顯示器訂單更是強勁增長，達到了 6.32 億美元。第一季度，公司營收成長了 45%，非 GAAP 毛利率提高了 300 個基點。

Non-GAAP operating expenses grew by 14% to the high end of the guidance range. Our ongoing spending discipline helped us to more than double our non-GAAP operating profit. We have reduced the non-GAAP tax rate by 6.2 points, and we grew non-GAAP earnings per share by 158%.

非GAAP營運費用成長14%，達到預期範圍的高端。我們持續的支出紀律幫助我們實現了非GAAP營業利潤翻倍。我們將非GAAP稅率降低了6.2個百分點，非GAAP每股收益成長了158%。

Next I'll compare our segment performance during Q1 to the same period last year. We grew semiconductor systems revenue by 57% and non-GAAP operating margin by 11.5 points. We grew services revenue by 12% and non-GAAP operating profit by 1.9 points. We also grew display revenue by 66% and non-GAAP operating profit by 8.4 points.

接下來，我將把我們第一季的業務表現與去年同期進行比較。我們的半導體系統收入成長了 57%，非 GAAP 營業利潤率成長了 11.5 個百分點。我們的服務收入成長了 12%，非 GAAP 營業利潤增加了 1.9 個百分點。我們的顯示器收入也成長了 66%，非 GAAP 營業利潤增加了 8.4 個百分點。

On the balance sheet, we grew cash and investments by 23% to $5.1 billion, and about 36% remained onshore. We paid cash dividends of $108 million and used $130 million for stock buybacks, reducing the ending share count by 5% year over year to 1.08 billion.

在資產負債表上，我們的現金和投資成長了 23%，達到 51 億美元，其中約 36% 留在了境內。我們支付了 1.08 億美元的現金股息，並以 1.3 億美元回購了股票，導致期末股份數量比去年同期減少了 5%，至 10.8 億股。

Now I will provide our guidance for the second quarter. We expect overall revenue to be in the range of $3.45 billion to $3.6 billion. The mid-point would be up by 44% year over year. On a year-over-year basis, our semiconductor systems revenue should increase by about 51%. Services revenues should increase by about 9%. And display revenue should increase by about 122%.

現在我將提供我們第二季的業績指引。我們預計總收入將在 34.5 億美元至 36 億美元之間。中間值將比上年同期上漲 44%。與去年同期相比，我們的半導體系統收入應該會成長約 51%。服務業收入預計將成長約9%。顯示器收入預計將成長約 122%。

In addition, non-GAAP gross margin should be about 45.5%. Non-GAAP operating expenses should be $645 million, plus or minus $10 million, and non-GAAP EPS should be in the range of $0.72 to $0.80, the mid-point of which would be up by 124% year over year.

此外，非GAAP毛利率應約為45.5%。非GAAP營運費用應為6.45億美元，上下浮動1000萬美元；非GAAP每股收益應在0.72美元至0.80美元之間，其中價值將比上年增長124%。

In summary, we are raising the ceiling on our expectations for the industries we serve, and we believe our markets will remain stronger. We have fundamentally changed our investment model to deliver greater value to our customers, and we are seeing that value reflected in higher market share and profitability. This stronger performance is sustainable, resulting in greater free cash flow. Now Mike, let's start the Q&A.

總而言之，我們提高了對我們所服務行業的預期上限，我們相信我們的市場將保持強勁。我們從根本上改變了投資模式，為客戶創造更大的價值，而這種價值也反映在更高的市場份額和獲利能力上。這種強勁的業績是可持續的，從而帶來了更大的自由現金流。麥克，現在開始問答環節。

Thanks, Bob.

謝謝你，鮑伯。

(Caller Instructions)

（來電者指示）

Operator, let's please begin.

操作員，請開始。

Thanks, Bob.

謝謝你，鮑伯。

(Caller Instructions)

（來電者指示）

Operator, let's please begin.

操作員，請開始。

Farhan Ahmad, Credit Suisse

法爾漢·艾哈邁德，瑞士信貸

Thanks for taking my question. My first question is in regards to the linearity of the year, some of your peers have indicated a significant decline in the second half of the year, primarily driven by 3D NAND. I just wanted to understand, is that something you are seeing as well?

謝謝您回答我的問題。我的第一個問題是關於今年的線性成長情況，你們的一些同行表示，下半年出現了明顯的下滑，這主要是由 3D NAND 驅動的。我只是想了解一下，你們也觀察到這種情況了嗎？

Sure, Farhan. Let me give you some context for how we think about the year and longer-term. We are really driving for and, frankly, achieving sustainable year-over-year growth in revenue share profitability. That's how we think about the business and look at it. As for 2017, this will be another good year. We see WFE up 5% or more in the year, and then for our fiscal year, as I said in the call, our semiconductor revenue should grow at 4 times that rate, our services revenue should grow at 2 times that rate, and our display revenue would grow at over 10 times that rate. So if you look at it, we gave you actuals for Q1 guide to Q2. Our full-year should model just as I said just now. You would then -- I think you'd get a pretty good feel for the second half of the year for us.

當然可以，法罕。讓我先介紹一下我們對今年及更長遠未來的規劃。我們正在努力實現收入份額盈利能力的可持續逐年增長，坦白說，我們也正在實現這一目標。我們就是這樣思考和看待這個行業的。至於2017年，這將又是美好的一年。我們預計 WFE 業務今年將成長 5% 或更多，然後，正如我在電話會議中所說，就我們的財年而言，我們的半導體收入應該會以這個速度增長 4 倍，我們的服務收入應該會以這個速度增長 2 倍，而我們的顯示器收入將以這個速度增長 10 倍以上。所以你看，我們已經為你提供了第一季到第二季的實際指引。我們全年的模型應該要跟我剛才說的一樣。這樣一來，我想你就能對我們下半年的情況有個比較清晰的了解了。

Thanks, Farhan.

謝謝你，法爾漢。

C.J. Muse, Evercore

C.J. Muse，Evercore

Good afternoon. Thank you for taking my question. I guess a question around display. How should we be thinking about the linearity of spend there first half, second half on a calendar year basis? And then considering -- I think you said in prepared remarks you expect to book roughly $2 billion of revenues there here in the calendar year, how should we think about the trajectory of revenues through calendar 2018? And I guess as part of that, would love to hear your thoughts on new product introductions and when we should think about weaving, I guess, incremental revenues from there in there as well. Thank you.

午安.感謝您回答我的問題。我猜這是關於顯示方面的問題。我們該如何看待以日曆年計算的上半年和下半年的支出線性關係？然後考慮到——我想您在事先準備好的發言稿中提到，您預計本年度的收入將達到約 20 億美元，那麼我們應該如何看待 2018 年的收入走勢呢？我想，作為其中的一部分，我很想聽聽您對新產品推出的看法，以及我們何時應該考慮從中增加收入。謝謝。

Sure. I will start, and Gary can jump in. Display continues to go up for us, frankly. In terms of the market context, when we did the analyst day back in September in New York, we thought that the 2016 would be WFE numbers of around $14.5 billion, as I remember. And we thought that next year would be about a similar number in calendar 2017. Thinking now it's about $17.4 billion in 2017, so the market's up about $3 billion from where we thought.

當然。我先開始，加里可以接著說。坦白說，我們的顯示效果一直在提升。就市場環境而言，我記得，我們​​在 9 月於紐約舉辦分析師日活動時，我們認為 2016 年 WFE 的數據約為 145 億美元。我們當時認為，2017 年的數字也會與此大致相同。現在看來，2017 年的市場規模約為 174 億美元，比我們預想的要高出約 30 億美元。

In terms of our own performance, I will do bookings first. We booked over $2 billion in 2016. We weren't sure we can get that same volume in 2017 because some of those 2016 booking ship through 2017 and 2018. In fact, we now think the bookings are pretty close in 2017 to what they were in 2016.

就我們自身的表現而言，我將首先進行預訂。2016年我們的收入超過20億美元。我們不確定 2017 年能否達到相同的銷量，因為 2016 年的一些訂單要到 2017 年和 2018 年才能出貨。事實上，我們現在認為 2017 年的預訂量與 2016 年的預訂量非常接近。

What's particularly interesting for me in that bookings mix for 2017 is if you go back to history, we used to be about 60% or so of our bookings were mobile, 65% some years, and about 65% for TVs, 35% mobile. It kind of flipped last year. We thought it would continue this year. We are strong in both this year. TV has come back strong. We mentioned the Gen 10.5 add, we see seven more of those we are tracking, so this year we think we will book about 55% for TV, 45% mobile. So strong in both, frankly. Now if you look at the revenues, which you asked about, this year we think our revenues are going to be pretty strong throughout the year. In terms of the quarterization, it's a little lumpy. Our Q3 might be a little stronger than our Q2, but pretty strong every quarter.

2017 年的預訂組合中，最讓我感興趣的是，回顧歷史，我們過去大約 60% 的預訂來自行動裝置，有些年份甚至達到 65%，而電視預訂大約佔 65%，行動裝置預訂佔 35%。去年情況有點逆轉。我們原以為今年還會繼續。今年我們在這兩方面都表現出色。電視產業強勢回歸。我們提到了第 10.5 代產品，我們看到還有 7 款產品正在追蹤中，因此我們預計今年電視廣告佔比將達到 55%，行動廣告佔比將達到 45%。坦白說，這兩方面都很出色。現在，如果你看一下你問到的收入狀況，我們認為今年的收入全年都會相當強勁。就四分位數分割而言，有點不均勻。我們第三季的業績可能比第二季略好一些，但每季都相當不錯。

I could add a little bit more also, C.J., on display. Put display and perspective. It's a great example of our ability to take materials engineering into an adjacent market. And if you go over a four-year period of time from 2012 to 2016, our orders have increased from around $400 million to $2 billion -- over $2 billion, about a 5 times increase in four years in display, which is incredible. But again it shows the ability to take our materials innovation technologies, CVD, [TBD], thin-film encapsulation, into a new market.

我還可以再添加一些東西，C.J.，用於展示。注重展示和視角。這是我們將材料工程技術應用於鄰近市場的絕佳範例。如果將時間跨度從 2012 年到 2016 年這四年，我們的訂單金額從大約 4 億美元增加到 20 億美元——超過 20 億美元，四年內增長了大約 5 倍，這令人難以置信。但這再次表明，我們有能力將我們的材料創新技術（CVD、[待定]、薄膜封裝）帶入新市場。

And we have talked about -- Bob talked about the TV sizes increasing and the seven Gen 10.5 projects. OLED mobile is also expanding to new customers, 50% of our demand going forward for this year is new customers for the mobile OLED. And then we have been focused on inflections and increasing our total available market. We have talked about tripling our served market as we go forward, and certainly as these new technologies like OLED or flexible OLED are adopted, that increases our total available market.

我們也討論過——鮑勃談到了電視尺寸的增大以及七個第 10.5 代項目。OLED 行動產品也正在拓展新客戶，今年我們 50% 的需求都來自 OLED 行動產品的新客戶。然後，我們一直專注於尋找轉折點並擴大我們的總市場規模。我們已經討論過，隨著我們不斷推進，我們將服務市場擴大三倍，而且隨著 OLED 或柔性 OLED 等新技術的普及，我們的總市場規模肯定會擴大。

We have been driving new technologies like thin-film encapsulation and eBeam review, again, reusing technologies that we have within our semiconductor business into display. You ask about the new products that we've talked about, and what we've said is that we will announce those sometime during 2017, but what I would say -- and we're not going to do that today, but what I would say is that those projects are on track and tremendous customer pull and investment for those new opportunities.

我們一直在推動薄膜封裝和電子束檢測等新技術的發展，再次將我們在半導體業務中擁有的技術應用於顯示器領域。您問到我們之前討論過的新產品，我們說過會在 2017 年的某個時候公佈，但我想說的是——雖然我們今天不會公佈——這些項目進展順利，而且這些新機會也獲得了巨大的客戶需求和投資。

Thanks, C.J.

謝謝，C.J.

Timothy Arcuri, Cowen and Company

提摩西‧阿庫裡，考恩公司

Thank you. So I just wanted to try to ask a question again, Bob, just on the loadings for the year. So if you look at your run rate based upon what you just booked, and if I assume roughly 25% WFE shear, which is what's in your model, you are run rating at roughly $44 billion -- not you but the industry. And if the year is going to be $37 billion, the math would say that you have to get to $30 billion sometime during the back half of the year now.

謝謝。所以，鮑勃，我只是想再問一個問題，關於今年的貨運量。所以，如果你根據你剛剛預訂的訂單來查看你的運行率，並且假設 WFE 剪切率約為 25%（這是你的模型中的值），那麼你的運行率約為 440 億美元——不是你個人的，而是整個行業的。如果今年的營收目標是 370 億美元，那麼根據計算，你必須在今年下半年達到 300 億美元。

Maybe things don't fall off that much, but I'm just wondering if you can sort of take those numbers and tell us if you think shipments are going to fall off during the back half of the year because the math seems to say that either shipments are going to fall off quite a bit or WFE is going to be a lot better than $37 billion this year. Thanks.

也許情況不會那麼糟糕，但我只是想知道，您能否根據這些數據告訴我們，您認為下半年的出貨量是否會下降，因為根據計算結果，要么出貨量會大幅下降，要么今年的WFE（全球出貨量）會遠超370億美元。謝謝。

So Tim, I gave you some color this first half, second half for us. I'll give you a little more specific to your question. I don't know that the industry is running at quite $44 billion now, and our model was to get to 25.5% market share in 2019. We think we are well on track for that. I'm not sure we're at that point right now in terms of the mathematics a little bit different.

提姆，我為你上半場和下半場都增添了一些色彩。我來更具體地回答你的問題。我不知道現在這個產業的規模是否真的達到了 440 億美元，而我們的目標是在 2019 年達到 25.5% 的市佔率。我們認為我們正朝著這個目標穩步前進。就數學層面而言，我不確定我們目前是否已經達到那個階段，情況略有不同。

Further what I will say to you is that the stuff I said to you earlier would imply the first half is strong. I don't disagree with that, but what I will also tell you is that we have seen the Q3 and Q4 numbers for us firm up as we go month by month the last few months. So my take on it, 2017 is a strong year. It's going to be a particularly strong year for Applied as we gain more share and display goes well for us. We also think that 2018, 2019 we see growth drivers that are really good for us in the industry the next couple of years. Will the second half be as strong as the first half? Not sure it is, but the overall trends are positive.

此外，我要告訴你的是，我之前跟你說的那些話表明，前半部很精彩。我並不反對這一點，但我還要告訴你的是，在過去的幾個月裡，我們看到第三季和第四季的業績數據逐月穩定成長。所以我覺得，2017年是個強勁的年份。對於應用材料公司來說，這將是業績格外強勁的一年，因為我們獲得了更多市場份額，而且展示業務也進展順利。我們也認為，2018 年和 2019 年的成長動力對我們產業未來幾年的發展非常有利。下半場會像上半場一樣精彩嗎？雖然不能確定，但總體趨勢是積極的。

Thanks, Tim.

謝謝你，提姆。

Atif Malik, Citi

阿提夫‧馬利克，花旗銀行

Hello, thanks for taking my question and congratulations on strong results and guide. Gary, some investors are still skeptical on China spending coming in 2018. Can you just provide a bit more color details on how your engagements are going with Chinese domestic projects?

您好，感謝您解答我的問題，並祝賀您取得如此優異的成績和提供的指導。Gary，一些投資者仍然對2018年中國的支出持懷疑態度。能否更詳細地介紹一下您參與中國國內計畫的情況？

Sure. Let me give you some color on China. What we are looking at in 2017 for China for Applied Materials is up versus 2016, maybe something like 10% up overall for us. And if you look at 2017 versus 2015, it's up maybe an additional $1 billion overall. Semi is slightly lower in that mix. Display is higher, and service is higher.

當然。讓我來跟你介紹一下中國。2017 年應用材料在中國的業務預計比 2016 年有所成長，整體成長幅度可能在 10% 左右。如果將 2017 年與 2015 年進行比較，整體上可能又增加了 10 億美元。半成品在這個比例中略低。顯示效果更好，服務也更好。

If you look at 2015 versus 2017, we've had 2 times growth -- or anticipating 2 times growth in semi revenue and about 50% growth in service and display. And China is really one of our strongest regions both with the multi-national companies and the domestic companies there. As we spend a lot of time and we have very deep relationships with the companies that are there, basically what we hear is that there is a big strategic drive in investment in China. There is a big gap in terms of domestic supply versus demand, and then there is also a drive to build a secure supply chain. So I think all of us see announcements and very large investments over the next several years in China.

如果將 2015 年與 2017 年進行比較，我們會發現半導體收入成長了 2 倍，預計服務和顯示器收入將成長約 50%。中國是我們實力最強的地區之一，那裡既有跨國公司，也有本土公司。由於我們花費了大量時間，並與當地公司建立了非常深入的關係，我們基本上了解到，中國正在進行大規模的戰略投資。國內供給與需求之間存在較大差距，同時，也需要建立安全的供應鏈。所以我認為我們都會看到未來幾年中國會發布一些公告並進行巨額投資。

In talking to those customers, they, I believe, understand that this is a long-term strategy. They have Phase I, Phase II, Phase III, and in the beginning those investments aren't going to be as efficient, especially in the more advanced technologies. But what I would say is that very consistently we see strong drive from a strategic perspective for increased investment in China, and really what we're seeing is 2018 and beyond significant increase. Again, we increased semi revenue 2 times from 2015 to 2017. If you ask me what do I think 2017 to 2019, that's going to be up a significant amount in semiconductor opportunity.

我相信，透過與這些客戶的交談，他們能夠理解這是一個長期策略。他們有第一階段、第二階段、第三階段，在初期階段，這些投資不會那麼有效，尤其是在更先進的技術領域。但我想說的是，我們一直看到從戰略角度來看，對中國的投資有著強勁的推動力，而且我們看到的是，2018 年及以後會有顯著成長。2015 年至 2017 年，我們的半導體收入再次成長了 2 倍。如果你問我對 2017 年至 2019 年的看法，我認為半導體產業的機會將會大幅成長。

Great. Thanks, Atif.

偉大的。謝謝你，阿提夫。

Stephen Chin, UBS

瑞銀集團 Stephen Chin

Thanks. Hello, Gary and Bob. Nice quarter and guidance, too. I have a follow-up question on the display order guidance. Can you share, Gary, how much of the display orders this year, the $2 billion, likely come from the Chinese display customers? Because I know we're all waiting for domestic China semiconductor spend to happen, but can sales to China's display customers bridge us over until the domestic semi CapEx happens in China next year?

謝謝。加里和鮑勃，你們好。本季業績和業績指引都很不錯。我還有一個關於展示順序指南的後續問題。Gary，可以透露今年20億美元的顯示器訂單中，有多少可能來自中國的顯示器客戶嗎？因為我知道我們都在等待中國國內半導體投資的到來，但是向中國顯示器客戶銷售產品能否幫助我們渡過難關，直到明年中國國內半導體資本支出到來？

I'll start, and we'll pull up some slides to help us. So total bookings this year will be over $2 billion in display. We see a lot of the big orders out of China for TVs in particular and some for mobile. So the numbers are large numbers for China. I would say the majority of the display stuff is probably China. Okay, so the majority of $2 billion, my guess -- I'm looking for the slides, frankly -- is probably, of the display bookings, probably half or more is China.

我先開始，我們再調出一些投影片來幫助我們。因此，今年展覽展示的總預訂額將超過20億美元。我們看到很多來自中國的大訂單，特別是電視機的訂單，還有一些是手機的訂單。所以，對中國來說，這些數字非常大。我認為大部分展示品可能都產自中國。好的，所以 20 億美元的大部分，我的猜測——坦白說，我正在尋找相關數據——可能，在展位預訂中，一半或更多來自中國。

Thanks.

謝謝。

Krish Sankar, Bank of America Merrill Lynch

克里什桑卡爾，美國銀行美林

Hello. Thanks for taking my question. I also have a display question. So Bob, if you look at last year, you did about $2 billion in bookings and about $1 billion in revenue. Should we expect that gap to close as you roll forward with new products and OLED gets more traction, or do you think the book to revenue is going to still have a lag effect here? And along the same path, what percentage of your bookings or revenue last year was OLED versus traditional displays? Thank you.

你好。謝謝您回答我的問題。我也有一個顯示方面的問題。鮑勃，如果你看看去年，你們的預訂金額約為 20 億美元，收入約為 10 億美元。隨著新產品的推出和OLED技術的普及，我們是否應該預期這一差距會縮小？或者您認為帳面收入與營收之間仍存在滯後效應？同樣地，去年您的預訂量或收入中，OLED 顯示器佔比是多少？傳統顯示器佔比又是多少？謝謝。

So your question is the book-to-bill, what's it going to stay for display and then how much was OLED? I guess that's the question --

所以你的問題是，從預算到最終成交價，顯示器的價格會是多少，OLED 的價格又是多少？我想這就是問題所在——

That's right.

這是正確的。

Last year we booked over $2 billion, and we billed -- now, remember we moved the web business in there and the service upgrade business, and we billed about 55% of that. This year we're going to book over $2 billion, but we will build a higher percentage of that. It will still be north of $1 billion. In terms of the outlook beyond 2017, 2018, we see a continuing strong bookings, but the book-to-bill kind of narrows. Last year was like a 1.6 or 1.7 or something like that. It was a big number. So that is going to trend down over time, but it will stay positive for a while.

去年我們預訂了超過 20 億美元的收入，並且我們開出了帳單——請記住，我們將網路業務和服務升級業務也納入其中，我們開出了其中約 55% 的帳單。今年我們的營收將超過 20 億美元，但我們將實現更高的建築面積佔比。仍然會超過10億美元。展望 2017 年、2018 年後，我們看到預訂量將持續保持強勁成長，但預訂量與實際出貨量之間的差距將會縮小。去年大概是1.6或1.7左右。這是一個很大的數字。所以隨著時間的推移，這個數字會呈現下降趨勢，但還會維持一段時間的正成長。

Thanks, Krish.

謝謝你，克里什。

Oh, OLED was -- if you look at last year, OLED mobile bookings were 65% of the total. And of the mobile piece, which was 65%, the majority of that was OLED.

哦，OLED 螢幕——如果你看看去年的數據，OLED 行動螢幕的預訂量佔總預訂量的 65%。在行動裝置市場佔有率中，65%是OLED螢幕。

Okay. Thank you.

好的。謝謝。

Harlan Sur, JPMorgan

哈蘭‧蘇爾，摩根大通

Hello. Good afternoon and congratulations on the solid execution. I think in the prior question you answered you talked about 50% roughly of your bookings for flat-panel being kind of China-focused. I'm assuming most of this is large-screen, but if we look at the Tier-2 OLED players in China, these guys are trying to play catch-up to the leaders in the market. Our research indicates that China is probably going to account for about 30% of the OLED CapEx spend in 2018, which is up significantly from this year's mix level. So I'm just wondering if you guys are starting to see this trend and just wondering if this is already starting to show up in the order books or the backlog, or is that still on the come?

你好。下午好，祝賀你們出色地完成了任務。我認為在你回答的上一個問題中，你提到大約 50% 的平板顯示器訂單都集中在中國市場。我估計大部分都是大螢幕電視，但如果我們看看中國的二線OLED廠商，就會發現他們正努力追趕市場領導者。我們的研究表明，2018 年中國 OLED 資本支出可能佔全球 OLED 資本支出的 30% 左右，比今年的比例大幅上升。所以我想知道你們是否開始注意到這種趨勢，以及這種趨勢是否已經開始體現在訂單簿或積壓訂單中，還是說這種情況還在醞釀中？

That's true. So you got a couple questions there. You got the China question and the OLED proliferation question. So if you look at China, as I said earlier, we sell for TV and mobile. TV is pretty big in China this year, but drilling into your question more around OLED mobile, as we said on the call last time and I think we repeated this time, we had orders from 10 different OLED manufacturers in the last year, predominantly in the last couple of quarters.

這是真的。所以你還有幾個問題。你遇到了中國問題和OLED普及問題。所以，如果你看看中國市場，正如我之前所說，我們的產品銷往電視和行動裝置。今年電視在中國市場非常火爆，但更深入地探討一下你關於 OLED 行動電視的問題，正如我們上次電話會議上所說，而且我認為這次我們也再次強調了，去年我們收到了來自 10 家不同 OLED 製造商的訂單，主要是在最近幾個季度。

Nine of those were for mobile phones. One was a lighting guide. So if you look at the mobile guide that's proliferating such that beyond the number one leader in OLED, we think that in 2017 our orders for OLED mobile is going to be probably over half from the followers -- not just in China, though.

其中九部是手機。其中一位是燈光指導。所以，如果你看看正在迅速發展的行動指南，就會發現，除了 OLED 領域的領導企業之外，我們認為 2017 年我們 OLED 行動訂單的一半以上可能來自其他廠商——而且不僅僅是在中國。

Joe Moore, Morgan Stanley

喬摩爾，摩根士丹利

Great. Thank you. It looks like you made nice progress on the operating margin on the display side. Can you talk about where that can go, and can you remind us where that business stands on gross and operating margins versus the semi business? Thank you.

偉大的。謝謝。看來你們在顯示器方面的營運利潤率取得了不錯的進展。您能否談談這項業務的未來發展方向，並提醒我們一下，與半導體業務相比，這項業務在毛利率和營業利潤率方面處於什麼水平？謝謝。

Sure we did make nice progress on the display business. So if you go look at it, we're up significantly this year on the operating margins for display, in the quarter in particular. We think the year's going to be up a fair amount year-on-year. We are well on track to hit the margins in the model in display [the FY19], but not every quarter's going to be exactly the same in display. My guess is Q2 may not be quite as high as Q1, but the year is going to be up significantly from last year.

當然，我們在顯示器業務方面確實取得了不錯的進展。所以如果你去看一下，你會發現我們今年的顯示器業務營業利潤率大幅成長，尤其是在本季。我們認為今年的業績將比上年有相當大的成長。我們預計在展示模型中實現利潤率目標（2019 財年），但展示方面每季的業績不會完全相同。我估計第二季可能不會像第一季那麼高，但全年業績肯定會比去年大幅成長。

Great. Thank you.

偉大的。謝謝。

Romit Shah, Nomura

野村證券的羅米特·沙阿

Yes, thank you and congratulations. At the analyst meeting in September you talked about earnings $2.80 on I think it was like a $35 billion WFE. This quarter it looks like you're run rating closer to $3 two years earlier than what you anticipated. So if WFE is coming in at $37 billion this year, and you guys think it will hold up again next year, Bob, what's maybe a more reasonable range to think about earnings in FY19 because the $2.80 does look increasingly conserved?

是的，謝謝，也恭喜你。在9月的分析師會議上，你談到了每股收益2.80美元，我記得當時WFE的規模是350億美元。本季你的股價似乎比預期提早兩年接近了 3 美元。所以，如果 WFE 今年的收入達到 370 億美元，而且你們認為明年還能保持這個水平，鮑勃，那麼對於 2019 財年的盈利，更合理的預期範圍是多少呢？因為 2.80 美元的預期看起來越來越難以實現了。

There's a few things -- I think we will do very well against that model. That model had a few assumptions. It kind of assumed a $34.5 billion WFE, and right now we're running a little north of that, frankly. There was a $37 billion model we showed that same day, which was $3.17.

有幾點需要注意——我認為我們能夠很好地應對這種模式。該模型有一些假設。它大致假設了 345 億美元的全球財政收入，坦白說，目前我們的實際收入略高於這個數字。當天我們還展示了一個價值 370 億美元的模型，每股價格為 3.17 美元。

The second thing there would have been market environment in that model was we assume the display equipment spending was going to be north of the historical number of eight but not necessarily up to what we realized last year, 14.5. So I would say market environment condition number one in those models, I'm more optimistic that the environment in 2019 is north of the $34.5 billion, and I'm more optimistic that the market environment for the display spending is north of what we have in that model. So the market is positively biased towards our base model last year, which is $2.80.

第二點是，該模型中的市場環境假設顯示設備支出將高於歷史平均 8，但不一定會達到我們去年實際實現的 14.5。因此，我認為在這些模型中，市場環境條件排名第一，我比較樂觀地認為 2019 年的市場環境將超過 345 億美元，而且我比較樂觀地認為顯示器支出的市場環境將高於我們在該模型中的預測值。因此，市場對我們去年的基本模型（2.80 美元）抱持著正面的偏好。

The second thing is the share position we have in both semi and display. We said we'd do 25.5 points in semi and we thought we'd be in a strong position in display. We are very confident of that. We gained two points in 2016, up to about 22, so we've got to get about a point a year the next three years. We will hit those numbers, I think, probably some upside. And then in display, the market and our products look good against the revenue in that plan, so I would say that the function of share and market result in a revenue opportunity against that model.

第二點是我們在半導體和顯示器領域的股份佔比。我們說過我們會在半決賽中拿到 25.5 分，我們認為我們會在比賽中處於有利地位。我們對此非常有信心。我們在 2016 年得了 2 分，達到了 22 分左右，所以接下來三年我們每年都要得大約 1 分。我認為我們會達到這些數字，而且可能還會有所超出。然後，從展示來看，市場和我們的產品與該計劃的收入相比表現良好，因此我認為，市場份額和市場的功能為該模型帶來了收入機會。

I think what kind of pleases me as much as anything, frankly, what we announced today and for next quarter is the margin profile. We had in the past iteration of the model -- we didn't move much on the margin. We said at the base model we would give 44.6% gross margins. Some people were a little skeptical because we hadn't moved too much. We reported today -- what was it, 45%, 45.4% actuals -- and then what we've said about gross margins last quarter was that in FY17 we'd be up to about 44% in a year, and that was a gain of 8/10 of a point. We now think in FY17 alone, instead of 8/10 of a gain versus 2016, we're going to gain a point half.

坦白說，最令我滿意的莫過於我​​們今天以及下個季度的業績，那就是利潤率狀況。在先前的模型迭代中，我們在邊際方面並沒有做出太多改變。我們說過，基本型號的毛利率將達到 44.6%。有些人有點懷疑，因為我們並沒有進行太多的搬遷。我們今天公佈了——實際值是多少來著，45%、45.4%——然後我們上個季度說過，2017 財年毛利率一年內將達到 44% 左右，這比上個季度增長了 0.8 個百分點。我們現在認為，僅在 2017 財年，與 2016 年相比，我們將獲得 0.5 個百分點的成長，而不是 0.8 個百分點的成長。

So if you look at that on the model you ask about, we're probably very comfortable that we can hit the 44.6% gross margin, which is at the $34.5 billion and the 45.1%, is the [$37 billion], we're probably pretty comfortable. And then we maintain pretty damn tight control on the operating expenses too. If you back calculate the guide we give for next quarter -- [now, if] next quarter is a good quarter, its operating margin's north of 27%. So in the annual models we showed for 2019, we showed operating margins of about 25.1% in the $34.5 billion and 26.4% in the $37 billion environment.

所以，如果你看一下你問的那個模型，我們可能很有信心能夠達到 44.6% 的毛利率（即 345 億美元），而 45.1% 的毛利率（即 370 億美元）我們可能也相當有信心。而且我們對營運費用也控制得非常嚴格。如果按照我們對下一季的指導方針進行反向推算——[現在，如果]下一季是一個好季度，其營業利潤率將超過 27%。因此，在我們展示的 2019 年年度模型中，我們在 345 億美元的營業額環境下實現了約 25.1% 的營業利潤率，在 370 億美元的營業額環境下實現了約 26.4% 的營業利潤率。

So with the operating margin we're making progress. And then if you finally go down to the loss, we said we'd shrink the share count to 1044 -- we are confident we will hit that. So we're not going to redo the model today, but around the market environment relative to that model, around our share position relative to the model, around our execution on gross margins, OpEx, and share count we are pretty confident that we will hit or potentially beat that model.

因此，我們在營業利潤率方面取得了進展。如果最終出現虧損，我們說過我們會將股票數量減少到 1044 股——我們有信心達到這個目標。所以我們今天不會重新制定模型，但是考慮到與該模型相關的市場環境、我們與該模型相關的市場份額、以及我們在毛利率、營運支出和股份數量方面的執行情況，我們相當有信心能夠達到甚至超過該模型。

Thanks, Romit.

謝謝你，羅米特。

Patrick Ho, Stifel Nicolaus

Patrick Ho，Stifel Nicolaus

Thank you very much and congrats on the quarter and the projected outlook for 2017. Gary, maybe just looking at 3D NAND and the market opportunities still going forward, you guys obviously have made great inroads in terms of etch and deposition, capital intensity but also your own share gains. As you look at the industry moving to 64 layers and then eventually to 96 layers, one, how do you see the capital intensity trends for the market overall? And maybe secondly for Applied, how do you see your competitive positioning increasing as the industry progresses?

非常感謝，恭喜您本季業績出色，並對2017年的業績展望表示讚賞。Gary，或許應該看看 3D NAND 以及未來的市場機遇，你們顯然在蝕刻和沈積、資本密集度以及自身市場份額的成長方面都取得了巨大的進展。當您看到產業發展到 64 層，最終發展到 96 層時，您如何看待整個市場的資本密集度趨勢？其次，對於應用材料公司而言，隨著產業的發展，您認為貴公司的競爭地位將如何提升？

Let me take on our position, and then Bob can talk about maybe capital intensity. So as we talked about overall, we gained 2 points of share in 2016 and actually our strongest gains are in 3D NAND. One of the really big drivers for our company is that 3D NAND is materials-enabled scaling versus litho-enabled scaling.

讓我先闡述我們的立場，然後鮑伯可以談談資本密集度的問題。正如我們之前討論的，總體而言，我們在 2016 年獲得了 2 個百分點的市場份額，而我們最大的成長點實際上來自 3D NAND。對我們公司而言，一個真正的大驅動力是 3D NAND 是材料驅動的規模化，而不是光刻驅動的規模化。

I met three of the top four memory CEOs in the last month. All of them are very bullish. The pull that they have for 3D NAND is really tremendous. And if you look in servers for instance and the total cost of ownership and the power consumption -- I was in our data center -- it's 80% less power consumption, and total cost of ownership is significantly better. So all of the people I am talking to our very bullish about 3D NAND.

上個月我見到了四大內存產業CEO中的三位。他們都非常看好市場。他們對 3D NAND 的需求真的非常巨大。例如，如果你看一下伺服器，看看總擁有成本和能耗——我去過我們的資料中心——能耗降低了 80%，總擁有成本也明顯更低。所以我接觸的所有人都非常看好 3D NAND。

Our position in 3D NAND, as we have talked about, we increase our TAM, our total available market, by a factor of three. When we're talking also about operating margins and our opportunities and display or in semi, our strategy is to focus on inflections. So we're winning share in inflections, and we're also delivering new capabilities. And so that comes through in 40% of our revenue being introduced from products that were introduced in the last three years. Just in 2016 our etch revenue was up 30%, CVD 33%, CMP revenue up 33%, our eBeam products, another area where there is a big inflection, the largest part of our PDC business, up 33%.

正如我們之前討論過的，憑藉我們在 3D NAND 領域的地位，我們的 TAM（總可用市場）增長了三倍。當我們談到營業利潤率、機會以及顯示器或半導體產業時，我們的策略是專注於轉捩點。因此，我們在轉折點上贏得了市場份額，同時也提供了新的能力。因此，我們 40% 的收入都來自過去三年推出的產品。僅在 2016 年，我們的蝕刻收入成長了 30%，CVD 成長了 33%，CMP 收入成長了 33%，我們的電子束產品（另一個大幅成長的領域，也是我們 PDC 業務的最大組成部分）成長了 33%。

So we see tremendous pull, and as you go to these future generations of 3D NAND, it's really all about materials innovation, how you scale to those additional numbers of layers, and we're in a really great position. The pull that we have from our customers is earlier, deeper, and broader than we have ever seen in the past. And then Bob can talk maybe about the capital intensity.

因此我們看到了巨大的市場需求，隨著未來幾代 3D NAND 的發展，一切都取決於材料創新，以及如何擴展到更多層數，而我們正處於一個非常有利的位置。我們現在感受到的客戶需求比以往任何時候都更加強烈、更加廣泛。然後鮑伯或許可以談談資本密集度問題。

Of 3D NAND? So what was your comparison again, Patrick, which to which? Which layer to which layer? I'll see if I can fill in.

3D NAND？派崔克，那麼你剛才的比較對像是什麼來著？哪個跟哪個比較？哪一層對應哪一層？我看看能不能頂。

So the capital intensity for 3D NAND if you go from planar to, say, 50 layers, the total CapEx is about $3.5 billion on planar, and 48 layers it's about $5 billion for greenfield. Now, I think the thing that's interesting is as we go from a planar reuse to a 50-layer, 48-layer the total CapEx to upgrade is $3.2 billion, almost the same as the opportunity in planar at $3.5 billion. What's really interesting for companies like us in way of materials is very etch and deposition intensive.

因此，如果從平面 3D NAND 升級到 50 層，平面 3D NAND 的總資本支出約為 35 億美元，而 48 層 3D NAND 的總資本支出約為 50 億美元。現在，我認為有趣的是，當我們從平面再利用升級到 50 層、48 層時，升級的總資本支出為 32 億美元，幾乎與平面再利用的機會 35 億美元相同。對於像我們這樣的公司來說，真正有趣的材料是那些需要大量蝕刻和沈積過程的材料。

Now, what's particularly interesting for Applied Materials additionally to that, to be frank, one, we didn't have the products or incumbent positions at the planar position, so the level of reuse for Applied is very low. You can see in our share gains, which have really been driven in etch, CVD, and some in CMP, is around the share gains we have made within etch, CVD, and CMP around some of these conversions from planar to 3D NAND and also some on DRAM. So one, total spend is bigger, two, it's really etch and deposition intensive, and three, it has been really good for Applied Materials within those products in the transition.

坦白說，對應用材料公司而言，特別有趣的是，首先，我們在平面位置上沒有產品或現有職位，因此應用材料的再利用率非常低。從我們的市佔率成長可以看出，這主要得益於蝕刻、CVD 和 CMP 的一些應用，也得益於我們在蝕刻、CVD 和 CMP 領域取得的市佔率成長，這主要與平面 NAND 向 3D NAND 的轉換以及 DRAM 的一些應用有關。所以，第一，總支出更大；第二，它確實需要大量的蝕刻和沈積；第三，在轉型過程中，這對應用材料公司在這些產品方面真的很好。

Thanks, Patrick.

謝謝你，派崔克。

Edwin Mok, Needham

埃德溫·莫克，尼德姆

I wanted to ask you guys about foundry logic. Just from your last report to this report, have you seen more broadening of demand in seven, five nanometer or in the trailing edge? Sounds like you got those beat on China. And then on [AMS], specifically around 7 or 5 nanometer, in terms of optional growth in 7-5, is it more just complex transistors [MRG] that demand more of your product because you guys are strong around transistor technology, or is it like you expect share gain around patterning a 7-5 nanometer that allows you to grow as those nodes go into production?

我想問大家關於代工邏輯的問題。從您上一份報告到這份報告，您是否看到對 7 奈米、5 奈米或後緣製程的需求更加廣泛？聽起來你們在中國那邊佔了上風。那麼，關於[AMS]，特別是7奈米或5奈米工藝，就7-5奈米工藝的可選增長而言，是因為你們在晶體管技術方面實力雄厚，所以更需要你們的產品來滿足複雜的晶體管[MRG]的需求，還是因為你們預計在7-5奈米工藝的圖形化方面獲得市場份額增長，從而隨著這些節點投入生產而實現增長？

I will do the first one, and Gary will do more the second one. So on broadening, this has been a year that's interesting in foundry. What might surprise you that of the trailing edge -- and I will define trailing edge as 20-nanometer, 28-nanometer, and above 45 -- it's 40% in 2017 will be those nodes. And you've got 55%, we think, for 7-10, and about 5% 14-16, so what's the point? 40% of spend this year in the foundries is 20-nanometer or above, so it's really strong. Last year was about 38%. It's been a bigger spend year. It takes actually a bigger percentage, which is interesting.

我來做第一個，加里主要負責第二個。所以，從更廣闊的角度來看，今年是鑄造業非常有趣的一年。可能會讓你感到驚訝的是，在後沿製程（我將後沿製程定義為 20 奈米、28 奈米和 45 奈米以上）中，2017 年的 40% 將是這些節點。我們認為，7-10 歲年齡層的人口占 55%，14-16 歲年齡層的人口占 5% 左右，那麼這有什麼意義呢？今年晶圓代工廠支出的 40% 都用於 20 奈米及以上工藝，所以這部分市場非常強勁。去年約為38%。今年支出較往年增加。實際上需要更高的比例，這很有趣。

So what you have this year is spending by the biggest foundry leader pretty strong and pretty big spending at the trailing nodes, and the opportunity you have to sustain foundry spending, which people are questioning about next year, is that we think that in 2018 we are going to have continued spending at the trailing edge. We think secondly that we're going to have a broadening of foundry spending, particularly next year. You asked about broadening spend -- I think it's a bigger impact next year because if you look at the shells they're putting up and opportunities in SMIC and GlobalFoundries in China and places like that, you're going to see some broadening of that.

所以今年最大的代工廠領導者支出相當強勁，下游節點的支出也相當大。至於明年能否維持代工廠的支出，人們都在質疑，我們認為 2018 年下游節點的支出將會持續。其次，我們認為晶圓代工支出將會擴大，尤其是明年。你問到擴大支出範圍的問題——我認為明年影響會更大，因為如果你看看他們正在建造的廠房，以及中芯國際和格羅方德在中國等地的機會，你會看到這方面的一些擴大。

In terms of the leading edge on 10-7, by the end of this year you're going to have 120,000 to 140,000 wafer starts of capacity for 10 and 7. We think that could probably at its peak double, so there's still some chance we'd run out 10-7 next year. So next year we're not pessimistic on foundry. We think there's opportunity, A, that trailing edge be strong, number one. Number two, we see some still significant additions for 10-7 where those conversions [are greenfield]. And three, we see broadening among some of the customer base.

就 10-7 晶圓的領先優勢而言，到今年年底，10 和 7 晶圓的產能將達到 12 萬至 14 萬片晶圓。我們認為，在產能高峰期，這個數字可能會翻一番，因此明年我們仍然有可能出現 10-7 晶圓產能耗盡的情況。所以明年我們對鑄造業並不悲觀。我們認為，第一，後緣優勢是強大的，這是一個機會。第二，我們看到 10-7 賽季仍然有一些重要的新增項目，這些項目都是全新的。第三，我們看到部分客戶群正在擴大。

So on the share gains, we have, as Bob talked about, I think pretty good line of sight on 7-nanometer and very strong pull for our transistor and interconnect products where we have extremely high share. And we're seeing more steps and an increase in our total available market as you go to 7-nanometer. In addition to the three memory CEOs I met, I also met the head of R&D for our largest logic and foundry customers within the last month. And what I would say is that we have stronger pull for earlier, deeper, and broader collaborations than we've ever had in the history of Applied Materials. And one of the things that we're really focused on if you go past 7-nanometer is how do we enable our customers to build devices that they could never build before?

所以，就市場佔有率的成長而言，正如鮑伯所說，我認為我們在 7 奈米製程方面有著相當清晰的前景，而且我們的電晶體和互連產品也擁有非常強勁的需求，我們在這些產品中擁有極高的市場份額。隨著技術發展到 7 奈米，我們看到了更多進步，我們的總可用市場也不斷擴大。除了我遇到的三位記憶體公司執行長之外，上個月我還見到了我們最大的邏輯晶片和代工客戶的研發負責人。我想說的是，與應用材料公司歷史上的任何時期相比，我們現在更渴望進行更早、更深入、更廣泛的合作。如果突破 7 奈米製程，我們真正關注的問題之一就是如何讓我們的客戶製造出他們以前從未製造過的設備？

So certainly we have great pull for new products, like Selectra, which, again, gives designers the capability that they never had before in designing new types of devices, and you will definitely see and we are seeing the ability to grow as fast as we can qualify with this kind of new capability. We have new films that our customers are adopting for 5-nanometer and beyond that also enable them to design devices in different ways. And certainly the transistor interconnect patterning is another area we have talked about where we have tremendous pull with Sym3 across the board for logic and foundry customers, the Selectra, Olympia, Precision CVD, PROVision, the LK Prime for CMP -- we're in the early innings of adoption of many of those products.

因此，我們對像 Selectra 這樣的新產品當然有很大的吸引力，它再次賦予了設計師們以前從未有過的能力來設計新型設備，而且你肯定會看到，我們也正在看到，只要我們能夠憑藉這種新能力獲得認證，我們就能以最快的速度發展壯大。我們擁有客戶正在採用的 5 奈米及以下尺寸的新型薄膜，這些薄膜還能讓他們以不同的方式設計裝置。當然，電晶體互連圖案化是我們討論過的另一個領域，在這個領域，我們與 Sym3 合作，為邏輯和代工客戶帶來了巨大的吸引力，例如 Selectra、Olympia、Precision CVD、PROVision、用於 CMP 的 LK Prime——我們正處於採用其中許多產品的早期階段。

And as you go beyond 7, the opportunities for us even become much larger for these products and other products that we have in our pipeline. So for me those conversations with those people running R&D are incredibly exciting, and the pull is really tremendous for Applied.

當產品數量超過 7 時，這些產品以及我們正在研發的其他產品的機會將會變得更加大。所以對我來說，與那些負責研發的人員進行對話令人無比興奮，而且對應用材料公司來說，這種吸引力真的非常巨大。

Thanks, Edwin.

謝謝你，埃德溫。

Weston Twigg, Pacific Crest Securities

韋斯頓特威格，太平洋證券

Hello. Thanks for taking my question. I just wanted to dig into, I guess, China and NAND a little bit more directly. A company a couple weeks ago, small cap, said that they thought their revenue from NAND memory customers would increase in the second half, partly driven by domestic Chinese memory producers, so some of these new fab projects that have been in the works. Just wondering if you're actually seeing any of that kind of demand that you would actually commit to maybe delivering some equipment in the second half, or if you still think those domestic projects might be more of a 2018 event.

你好。謝謝您回答我的問題。我只是想更直接地深入了解中國和 NAND 快閃記憶體之間的關係。幾週前，一家市值較小的公司表示，他們認為下半年來自 NAND 記憶體客戶的收入將會增加，部分原因是受到中國國內記憶體生產商的推動，因此一些新的晶圓廠項目一直在籌備中。我只是想知道，您是否真的看到了那種需求，以至於您會承諾在下半年交付一些設備，或者您是否仍然認為這些國內項目可能更適合在 2018 年進行。

Well, we definitely see -- we are engaged with all those different companies. Our share in China is the highest or near the highest that we have for any region, so our engagement those companies are very strong. We don't really see in 2017 significant revenue growth coming from those companies. Again, our overall revenue in China we anticipate in 2017 is somewhere around $2.6 billion, so for us having something that moves the needle for us has to be fairly sizable. We are definitely deeply engaged with all of those companies, and we look at 2018 and beyond as a much bigger opportunity.

嗯，我們當然看到了——我們與所有這些不同的公司都有合作。我們在中國的業務份額是所有地區中最高的，或接近最高的，因此我們與這些公司的合作關係非常密切。我們預計這些公司在 2017 年不會有顯著的營收成長。再次強調，我們預計 2017 年在中國的總收入約為 26 億美元，因此，對我們來說，能夠真正推動業務成長的因素必須是相當大的。我們與所有這些公司都有著深入的合作，並將 2018 年及以後視為更大的機會。

All right. Thank you.

好的。謝謝。

Craig Ellis, B. Riley

克雷格·艾利斯，B·萊利

Thanks for taking the question and congratulations on the good execution. I wanted to return to the comments regarding reduced industry volatility because some of the measures we have for upstream semiconductor industry volatility show about a 75% reduction over the last five years versus the proceeding 15. So it seems like for a company like Applied Materials in that environment there should be certain parts of the business that benefit from increased operating efficiency. So the first part of the question would be are you seeing that, and to what extent is that realized?

感謝您回答這個問題，並祝賀您出色地完成了任務。我想回到關於產業波動性降低的評論，因為我們對上游半導體產業波動性的某些衡量指標顯示，過去五年與前 15 年相比，波動性降低了約 75%。因此，對於像應用材料公司這樣的企業來說，在這種環境下，其業務的某些部分應該會受益於營運效率的提高。所以問題的第一部分是：你是否看到了這一點？以及，這一點在多大程度上得到了實現？

And the second part of the question is there should also be in that environment increased free cash flow predictability, and how does the company think about in a more stable environment, more seasonal environment, increasing systematic cash return or cash actions to create value? Thank you.

問題的第二部分是，在這種環境下，自由現金流的可預測性也應該提高，公司在更穩定的環境、更有季節性的環境中，如何考慮增加系統性的現金回報或現金行動來創造價值？謝謝。

There's probably about three levels to that question. One, the volatility question. Two, was the benefits to the operating margins from volatility. And three, the benefits to cash return. So in terms of volatility, I completely agree with you. The volatility is trending down. Almost every metric we look at indicates that. The long-term metrics are the demand drivers for the industry are much more diverse and sustainable, and then layer on that you get all these technology conversions.

這個問題可能包含三個層面。第一，波動性問題。第二，波動性對營業利益率帶來的好處。第三，現金回報的好處。所以就波動性而言，我完全同意你的看法。波動性呈下降趨勢。我們考察的幾乎所有指標都顯示了這一點。從長遠來看，產業的需求驅動因素更加多樣化和可持續，再加上所有這些技術轉型。

I was just looking at some data today that the volatility is down but within Applied it's down, too, because we are a much broader company. So I'll give you a couple of data points that I hadn't shared before. So if you just look at our revenue split in semi in 2015, 2016, and 2017, 5% was memory -- stayed pretty steady at 48%, 47%, 47%. And then there's percent that's been foundry has ranged from 38% to 42%, and logic is 12% or 13%. So within device type, we are much stronger than we used to be, and we project in 2017 that our market share by device type in NAND, DRAM, foundry, and logic in all four of the major categories will be 21.5% or above, whereas we used to have a 10- or 15-point spread from our low memory ones in a high foundry. We've gotten a lot stronger in memory.

我今天查看了一些數據，發現波動性下降了，但應用材料公司的波動性也下降了，因為我們是一家業務範圍更廣的公司。所以，我將提供一些我之前沒有分享過的數據點。所以，如果你看看我們在 2015 年、2016 年和 2017 年半導體業務的收入佔比，5% 是記憶體——在 48%、47%、47% 之間保持相當穩定。此外，鑄造廠的佔比在 38% 到 42% 之間，邏輯電路的比例為 12% 或 13%。因此，就裝置類型而言，我們比以前強大得多，我們預計到 2017 年，我們在 NAND、DRAM、代工和邏輯這四大主要類別中的市場份額將達到 21.5% 或更高，而我們過去在低內存領域和高代工領域之間存在 10 到 15 個百分點的差距。我們的記憶力增強了很多。

The volatility in the industry is down and the volatility within Applied is down a lot. And then you layer in the strength in the service business, which has grown a lot, and the display business, which has grown a lot and is sustainable. So I agree with you on the volatility. Where will we see the benefits on the operating margin? We are going to see them in a few places.

產業波動性下降，應用材料公司內部的波動性也大幅下降。此外，服務業（快速成長）和展示業（成長迅速且可持續發展）的強勁勢頭也發揮了重要作用。所以我同意你對波動性的看法。我們將在哪些方面看到營業利益率的提升？我們將會在幾個地方見到它們。

One, we will grow our revenue line, and it will be more predictable. So that results in a few things. One, you tend to use factory utilization higher, so cost of goods sold, gross margins tend to trend up. So if you look at the benefits on gross margin, we are just grinding away on material cost and factory utilization, and that's helping us on these gross margins.

第一，我們的收入將會增加，而且收入也會更可預測。這樣就產生了以下幾個結果。第一，工廠利用率往往較高，因此銷售成本和毛利率往往會上升。所以，如果你看看毛利率帶來的好處，你會發現我們一直在努力降低材料成本和提高工廠利用率，這有助於我們提高毛利率。

As I said earlier in the call, we thought our gross margins would be up this year by 8/10 of a point to 44 points. We now think we're going to be up a point and a half, and a lot of this kind of is just sufficiency grinding away, sustainability looks more predictable, less volatility we talked about. And then I said earlier in the call that we predict our operating margin in Q2 to be north of 27%, so we are seeing in the numbers the company is becoming more efficient, more effective with the products we're doing but also with this less volatility is contributing. We are now, for instance, in our factories looking to be much more aggressive in what we ship in the first four weeks of a quarter to even more level load our factories. So you are 100% right.

正如我之前在電話會議中所說，我們認為今年的毛利率將上升 0.8 個百分點，達到 44 個百分點。我們現在認為我們會上升 1.5 個百分點，而且很多時候這只是適度增長的結果，可持續性看起來更可預測，波動性也更小，我們之前討論過這個問題。我在之前的電話會議中說過，我們預計第二季度的營業利潤率將超過 27%，因此我們從數據中可以看到，公司正在變得更加高效，我們正在生產的產品也更加有效，而且波動性降低也對此有所貢獻。例如，我們現在正在工廠裡尋求在每個季度的前四周更加積極地增加出貨量，以使我們的工廠負載更加均衡。所以你的說法完全正確。

In terms of the benefits to the investors, we are starting to generate more significant cash returns. So if you look at the operating cash flow was 20% this quarter, which is very high for us in Q1. Last year Q1 was kind of like 9%, so we do it now the question is getting back to the investors. We are going to do it. We didn't do too much last quarter because we were looking at boundary conditions around what's going to change in the tax laws, movement of cash between overseas and US. But we see, one, we are committed to do it, two, I think we will have the flexibility to do it, and three, some of the changes that are being proposed in Washington may be beneficial to us in multiple ways -- long-term tax going to territorial system, we're on a worldwide system. So I think it's a great opportunity for the investors of Applied on this.

就投資者收益而言，我們開始產生更顯著的現金回報。因此，如果你看一下本季的經營現金流，會發現它達到了 20%，這對我們來說，在第一季是非常高的。去年第一季成長率大概是 9%，所以我們現在的問題是能否讓投資人滿意。我們打算這麼做。上個季度我們沒有做太多事情，因為我們當時正在研究稅法變化、海外匯款與美國之間的流動等方面的邊界條件。但我們看到，第一，我們致力於這樣做；第二，我認為我們將有靈活性去做；第三，華盛頓提出的一些改革可能會在多方面對我們有利——長期稅收轉向屬地制度，而我們採用的是全球製度。所以我認為這對Applied的投資者來說是一個絕佳的機會。

Great. Thanks Craig for the question, and, operator, I think we have time for just one more, please.

偉大的。謝謝克雷格的提問，接線員，我想我們還有時間再問一個問題，謝謝。

Sidney Ho, Deutsche Bank

西德尼·何，德意志銀行

Great. Thanks for taking my question. Your DRAM orders have bounce back to where it was a year ago. Obviously you are gaining share there as well, but can you talk about what you expect [midgrove-wise] that could translate into for DRAM? And do you share the view that DRAM suppliers are remaining disciplined in capital spending during the period where pricing is pretty good? Any color would be helpful, thanks.

偉大的。謝謝您回答我的問題。您的DRAM訂單量已回升至一年前的水平。顯然，你們在那裡的市場份額也在不斷增長，但你們能否談談你們預期（就 Midgrove 而言）這會對 DRAM 產生什麼影響？您是否也認為，在價格相當優惠的時期，DRAM供應商在資本支出方面保持了謹慎？任何顏色都可以，謝謝。

I can start, and Gary can jump in. I'll tell you what's encouraging for me on some of this stuff, if you look at NAND and DRAM -- I look at NAND now and DRAM in a second -- we look at NAND bit growth and supply as pretty much in line and growing about 45% a year. That's 45% over a bigger and bigger install base, so the end-use demand for NAND is pretty damn strong. And DRAM is pretty similar. We see bit demand in 2016 up about 30%, and then we see server DRAM up about 40%, 45% in 2017. And supply has been a little tighter. We see 2017 it's only supply bit growth is only about 25% to 30%. And we see a lot of smartphone consumption up for new Android 6GB and Apple third-generation.

我可以先開始，加里可以加入。讓我告訴你，關於這些方面，有些事情令我感到鼓舞。如果你看看 NAND 和 DRAM——我現在看 NAND，稍後再看 DRAM——我們看到 NAND 的比特增長和供應量基本上一致，每年增長約 45%。在不斷擴大的安裝基數上，NAND 的成長率達到了 45%，因此終端使用者對 NAND 的需求非常強勁。DRAM 也非常類似。2016 年，我們預計位元需求將成長約 30%，2017 年伺服器 DRAM 將成長約 40% 至 45%。而且供應也稍微緊張了一些。我們看到 2017 年只有供應量成長，增幅僅 25% 至 30%。我們看到新款安卓 6GB 和蘋果第三代智慧型手機的銷量大幅成長。

But what's good for Applied is our market share within DRAM is up about five points from 2012 to 2015. We think we're going to get another point in 2016. So we think, one, that this market in demand for DRAM and NAND is growing pretty healthily, two, it is growing pretty disciplined, even with the NAND capacity additions, what we see is big demand drivers for more NAND versus other factoid, I don't think we gave you is as the solid-state drives become more and more cost effective, there's probably going to be a need for up to about 500,000 more wafer starts greenfield to add capacity to what they have today. In other words if you look in the world, there used to be about 1.4 million wafer starts in NAND. Now we might be 1.6 million wafer starts. But that's not even enough.

但對應用材料公司來說，好消息是我們在DRAM市場的市佔率從2012年到2015年成長了約5個百分點。我們認為2016年我們還能再得一分。所以我們認為，第一，DRAM 和 NAND 的市場需求正在健康成長；第二，即使 NAND 產能增加，其成長也相當穩健。我們看到，相較於其他因素，對更多 NAND 的需求才是主要驅動力。我之前沒有提到的是，隨著固態硬碟的成本效益越來越高，可能需要新增約 50 萬片晶圓的生產，以增加現有產能。換句話說，放眼全球，NAND 快閃記憶體晶圓的開工量曾經約為 140 萬台。現在我們可能已經有160萬片晶圓啟動了。但這還不夠。

Over the next four years they probably have to add another 500,000 just for servers. Each 100,000 of NAND is worth about $5 billion. That's about $5 billion that they have to have to reach their growth in their markets. So what's the point? Good growth drivers for NAND and DRAM, number one. Number two, pretty disciplined, even with the capacity to do it on NAND because their market is expanding. Three, our position is gone up where we would gain, by the time we're done in 2016, we'll probably have gained about seven points of both NAND and DRAM from 2012.

未來四年，他們可能還需要新增 50 萬台伺服器。每10萬個NAND快閃記憶體晶片價值約50億美元。他們要想在各自市場成長，大約需要50億美元。所以這麼做的意義何在？第一，NAND 和 DRAM 的成長動力良好。第二，他們非常自律，即使有能力在 NAND 上開發，因為他們的市場正在擴大。第三，我們的排名上升了，到 2016 年結束時，我們 NAND 和 DRAM 的市佔率可能都會比 2012 年成長約 7 個百分點。

Okay, great. Thanks for that question, and then, Bob, if you'd like to summarize it all before we close the call?

好的，太好了。謝謝你的提問，鮑勃，在結束通話之前，你能不能總結所有內容？

We talked about a lot of esoteric stuff here: bit growth and materials engineering. When I step back even more than a few years ago, I think Applied has a really good business. If you look at our markets in which we compete, we're doing really well. Better than they were years ago. Our position is much better, and as somebody answered on the call, our better execution and the less volatility of the market is resulting in significant improvement in operating margin to cash flow, so we have a really good business. And what we are doing here is driving sustainable year-over-year growth in revenue share profitabilities.

我們在這裡討論了很多深奧的東西：比特生長和材料工程。如果把時間再往前推幾年，我認為應用科技的業務真的非常成功。如果你看看我們所處的競爭市場，你會發現我們做得非常好。比幾年前好多了。我們的處境好多了，正如有人在電話會議上回答的那樣，我們更好的執行力和更小的市場波動性正在顯著提高營業利潤率與現金流的比率，所以我們的業務真的很好。而我們在這裡所做的，是推動收入份額和盈利能力實現可持續的逐年增長。

So that three things as I summarize again is one, our markets are getting better, bigger, and less volatile. WFE and display are both strong with positive long-term outlook. We have strong share, as I said in all device types. We're up in memory, in particular, and foundry we've always been strong and then display is doing very well. And if you look at our service business which was $2 billion back in 2013, we're going to hit the $3.2 billion in 2019, so that's grown a lot and that's a very strong baseline business.

所以，我再次總結這三點：第一，我們的市場正在變得更好、更大、更波動。WFE 和顯示器業務均表現強勁，長期前景樂觀。正如我所說，我們在所有設備類型中都擁有強大的市場份額。我們在儲存領域，尤其是晶片製造領域，表現非常出色；晶片鑄造領域我們一直很強；顯示領域也發展得非常好。如果你看看我們的服務業務，2013 年的規模是 20 億美元，到 2019 年我們將達到 32 億美元，所以成長了很多，這是一個非常強勁的基礎業務。

Second, our execution is better. Our deep pipeline of products enabled by the product development engine where 40% of our equipment revenue now is generated from products we've introduced in the last three years. We have multiple years of share gain, and which I don't think we mentioned on the call, we have record backlog of $5.5 billion at this point. So that's all around better execution. And finally the question I just got asked, the ability to return cash is better than ever. Revenue is outpacing our markets. Operating margin is growing. As I said, we're going to be over 27% next year, and we have a great deal of flexibility to return more cash to shareholders. So I just think Applied has got really good business when you cut through it, so I feel really good about the business.

其次，我們的執行力更強。我們強大的產品線得益於產品開發引擎，目前我們 40% 的設備收入都來自過去三年推出的產品。我們連續多年實現市場份額成長，而且我認為我們在電話會議上沒有提到，目前我們的積壓訂單額達到了創紀錄的 55 億美元。所以，整體執行力都提升了。最後，回答剛才被問到的問題，退款的便利性比以往任何時候都更好。營收成長速度超過市場平均。營業利潤率正在成長。正如我所說，明年我們的收益率將超過 27%，而且我們有很大的靈活性向股東返還更多現金。所以我覺得，仔細分析一下，Applied 的業務其實非常好，所以我對這家公司很有信心。

Great. Okay. Thanks, Bob. And we would like to thank everyone for joining us this afternoon. A replay our call is going to be available on the website beginning at 5:00 PM Pacific. Thank you for your continued interest in Applied Materials.

偉大的。好的。謝謝你，鮑伯。我們衷心感謝各位今天下午蒞臨。本次電話會議的錄音回放將於太平洋時間下午 5:00 在網站上提供。感謝您一直以來對應用材料公司的關注。