博通 (AVGO) 2020 Q3 法說會逐字稿

Welcome to Broadcom Inc. Third Quarter Fiscal Year 2020 Financial Results Conference Call. At this time, for opening remarks and introductions, I would like to turn the call over to Beatrice Russotto, Director of Investor Relations of Broadcom Inc. Please go ahead.

歡迎參加 Broadcom Inc. 2020 財年第三季財務業績電話會議。現在，我想將電話轉給博通公司投資者關係總監 Beatrice Russotto，請您繼續。

Thank you, operator, and good afternoon, everyone. Joining me on today's call are Hock Tan, President and CEO; and Tom Krause, Chief Financial Officer of Broadcom.

謝謝接線員，大家下午好。與我一起參加今天電話會議的還有總裁兼執行長 Hock Tan；以及博通財務長湯姆·克勞斯 (Tom Krause)。

After the market closed, Broadcom distributed a press release and financial tables describing our financial performance for the third quarter of fiscal year 2020. If you did not receive a copy, you may obtain the information from the Investors section of Broadcom's website at broadcom.com. This conference call is being webcast live, and a recording will be available via telephone playback for 1 week. It will also be archived in the Investors section of our website at broadcom.com.

收盤後，博通發布了一份新聞稿和財務表格，描述了我們 2020 財年第三季的財務業績。如果您沒有收到副本，您可以從博通網站 Broadcom.com 的投資者部分獲取資訊。本次電話會議正在進行網路直播，錄音將透過電話播放 1 週。它還將存檔在我們網站 Broadcom.com 的投資者部分。

During the prepared comments, Hock and Tom will be providing details of our third quarter fiscal year 2020 results, guidance for our fourth quarter as well as commentary regarding the business environment. We'll take questions after the end of our prepared comments. Please refer to our press release today and our recent filings with the SEC for information on the specific risk factors that could cause our actual results to differ materially from the forward-looking statements made on this call.

在準備評論期間，Hock 和 Tom 將提供我們 2020 財年第三季業績的詳細資訊、第四季度的指導以及有關商業環境的評論。我們將在準備好的評論結束後回答問題。請參閱我們今天的新聞稿以及我們最近向美國證券交易委員會提交的文件，以了解可能導致我們的實際結果與本次電話會議中所做的前瞻性聲明存在重大差異的具體風險因素的資訊。

In addition to U.S. GAAP reporting, Broadcom reports certain financial measures on a non-GAAP basis. A reconciliation between GAAP and non-GAAP measures is included in the tables attached in today's press release. Comments made during today's call will primarily refer to our non-GAAP financial results.

除了美國公認會計原則報告外，博通還根據非公認會計原則報告某些財務指標。今天新聞稿所附的表格中包含了公認會計原則和非公認會計原則措施之間的調節。今天電話會議期間發表的評論將主要涉及我們的非公認會計準則財務表現。

So with that, I'll now turn the call over to Hock.

因此，我現在將把電話轉給霍克。

Thank you, Bea, and thank you, everyone, for joining us today.

謝謝 Bea，也謝謝大家今天加入我們。

I have to say that the strength of our broad and diversified portfolio of leadership technology franchises led to record third quarter revenue for Broadcom despite these uncertain times we continue to operate in. We remain well positioned to address the work-from-home environment, especially with many of our networking and broadband products in the cloud and telcos. In addition, we expect to soon start from benefiting from the transition to 5G and new product ramps later this year. While there continues to be ebb and flow in the parts of our business linked to enterprise, this is somewhat offset by the highly recurring revenue of our infrastructure software divisions. So as a result, we remain confident in the strategy we have laid out over the past several years, delivering sustainable revenue and significant cash flow margins while remaining focused on total shareholder return.

我必須說，儘管我們繼續經營在這些不確定的時期，但我們廣泛且多元化的領先技術特許經營組合的實力為博通帶來了創紀錄的第三季度收入。我們仍然處於有利地位，可以解決在家工作的環境，特別是我們在雲端和電信公司中使用了許多網路和寬頻產品。此外，我們預計很快就會開始受益於今年稍後向 5G 的過渡和新產品的推出。雖然我們與企業相關的業務部分繼續出現起伏，但這在一定程度上被我們基礎設施軟體部門的高經常性收入所抵消。因此，我們對過去幾年制定的策略仍然充滿信心，提供可持續的收入和可觀的現金流利潤率，同時繼續關注股東總回報。

Let me now provide further detail on our third quarter results. We delivered net revenue of $5.8 billion, above the midpoint of our guidance and up 1% sequentially and up 6% year-on-year. Semiconductor solutions revenue was $4.2 billion, declining 4% year-on-year. Infrastructure software revenue was $1.6 billion, up 41% year-on-year, which, of course, does include the contribution from Symantec in 2020.

現在讓我提供有關我們第三季業績的更多詳細資訊。我們實現淨收入 58 億美元，高於我們指導的中位數，季增 1%，年增 6%。半導體解決方案營收為42億美元，較去年同期下降4%。基礎設施軟體營收為16億美元，年增41%，當然，這其中確實包括賽門鐵克在2020年的貢獻。

Starting with semiconductors. Our semiconductor solutions segment was up 5% sequentially driven by continued strength in networking and broadband. Networking was up 9% sequentially due to continued healthy demand from our cloud customers as we began to ramp for next-generation Tomahawk 3 and Trident 3 switch products. Routing demand also remains strong as telcos launch our Jericho 2 in the EDGE and core networks. We expect the strength in networking that we have experienced since the beginning of this fiscal year to sustain in Q4, with continued demand from cloud and telcos driving solid sequential growth.

從半導體開始。在網路和寬頻持續強勁的推動下，我們的半導體解決方案部門連續成長了 5%。隨著我們開始推出下一代 Tomahawk 3 和 Trident 3 交換器產品，由於雲端客戶的持續健康需求，網路業務連續成長了 9%。隨著電信公司在 EDGE 和核心網路中推出我們的 Jericho 2，路由需求也依然強勁。我們預計自本財年年初以來我們所經歷的網路優勢將在第四季度得以維持，雲端運算和電信公司的持續需求將推動穩健的連續成長。

Turning to broadband, which was up 7% sequentially in Q3. We continue to see strong demand for the next-generation cable modem DOCSIS 3.1, which was partially offset by a decline in the satellite set-top boxes. We also continue to see strong adoption of WiFi 6 in next-generation access gateways in telcos and consumer and even in large enterprises. Telecom and consumer have been particularly strong driven by work-from-home environment. But after a strong Q3, we expect the strength in broadband revenue to take a pause and come down on a sequential basis by approximately 10% in Q4. Keep in mind, however, this will still be up 20% on a year-on-year basis.

轉向寬頻，第三季季增 7%。我們繼續看到對下一代有線電纜數據機 DOCSIS 3.1 的強勁需求，但衛星機上盒銷量的下降部分抵消了這一需求。我們也持續看到 WiFi 6 在電信公司和消費者甚至大型企業的下一代存取網關中被廣泛採用。電信和消費者在在家工作環境的推動下尤其強勁。但在第三季的強勁表現之後，我們預計寬頻收入的強勁勢頭將暫停，並在第四季環比下降約 10%。但請記住，這仍將年增 20%。

Moving on, wireless was down 4% sequentially in Q3 due to the expected typical ramp being pushed out this year. This is expected to result in a significant uplift, however, in wireless revenue of approximately 50% sequentially in Q4. Despite this significant sequential ramp and a significant increase in our RF content, we expect revenue to be roughly flat year-on-year in Q4. Now this is due to fewer units of our parts for the next-generation phone being shipped in the fourth quarter this year relative to last year due to this product delay. That being said, we currently expect Q1 revenue in wireless to be up sequentially from Q4 with an increase in expected unit shipments of our parts for the next-generation phone compared to Q1 last year. In other words, the launch ramp this year is expected to complete only in Q1 where it's normally been completed in Q4 of previous years.

接下來，由於今年預期的典型成長將被推遲，第三季無線業務將較上季下降 4%。然而，這預計將導致第四季度無線收入環比大幅增長約 50%。儘管出現了顯著的連續成長以及射頻內容的顯著增加，但我們預計第四季度的營收將與去年同期大致持平。現在，這是由於由於產品延遲，今年第四季我們下一代手機的零件出貨量比去年少。話雖如此，我們目前預計第一季無線業務收入將比第四季連續成長，與去年第一季相比，我們下一代手機零件的預期單位出貨量將有所增加。換句話說，今年的發射預計僅在第一季完成，而往年通常在第四季完成。

In server storage connectivity where the majority of the revenue is tied to enterprise, Q3 was up 10% sequentially. However, expected softness in enterprise demand will likely result in server storage revenue declining in high single digits quarter-over-quarter in Q4.

在大部分營收與企業相關的伺服器儲存連線領域，第三季較上季成長了 10%。然而，預計企業需求疲軟可能導致第四季度伺服器儲存收入環比出現高個位數下降。

Turning last to industrial. Resales and revenues were both down 3% sequentially in Q3. In Q4, we expect resales to continue to hold up. However, we are taking the opportunity to further reduce our channel inventory significantly. And as a result, we expect industrial revenue to be down double digits quarter-over-quarter in Q4.

最後轉向工業。第三季轉售量和營收均較上季下降 3%。第四季度，我們預計轉售量將持續維持成長。然而，我們正在藉此機會進一步大幅減少渠道庫存。因此，我們預計第四季工業收入將環比下降兩位數。

So in summary, our semiconductor solutions segment was up 5% sequentially in Q3. And given the continuing surge of demand in networking and the expected 5G phone ramp in wireless, we expect a mid-teens percentage sequential increase in our fourth fiscal quarter. We should note, on a year-on-year basis, Q4 will mark a return to growth for our semiconductor segment overall, which we think is a key inflection point for Broadcom and which we expect to sustain into Q1.

總而言之，我們的半導體解決方案部門在第三季環比成長了 5%。鑑於網路需求的持續激增以及無線領域 5G 手機的預期成長，我們預計第四財季將出現中位數百分比的環比成長。我們應該注意到，與去年同期相比，第四季將標誌著我們半導體業務整體恢復成長，我們認為這是博通的關鍵拐點，我們預計這一趨勢將持續到第一季。

Now turning to software. CA was up 6% year-on-year, flat sequentially. Bookings at our core accounts continued to grow double digits year-on-year and has offset the expected reduction in the services business. Symantec was flat sequentially and contributed over $400 million in the quarter. Similar to CA, bookings in our Symantec core accounts are growing, offsetting the transition out of the smaller commercial accounts as we continue to rationalize the business. Brocade was up 3% year-on-year and, as expected, was down significantly sequentially. Looking ahead to next quarter on a sequential basis, we expect revenues from CA to sustain and expect Symantec revenue to be up 4%. We anticipate Brocade revenue to be relatively flat on a sequential basis. And as a result, revenue from the software segment is expected to be up by a low single-digit percentage sequentially in the fourth quarter.

現在轉向軟體。 CA年增6%，月增6%，季平。我們的核心客戶預訂量繼續以兩位數同比增長，抵消了服務業務的預期下降。賽門鐵克與上一季持平，該季度貢獻了超過 4 億美元。與 CA 類似，我們的賽門鐵克核心客戶的預訂量正在成長，抵消了隨著我們繼續合理化業務而從小型商業客戶中轉型出來的影響。博科年增 3%，但如預期，季比大幅下滑。展望下個季度，我們預計 CA 的營收將維持不變，並預期賽門鐵克的營收將成長 4%。我們預計博科收入環比將相對持平。因此，第四季度軟體部門的收入預計將環比增長較低的個位數百分比。

So in summary, we expect our fourth quarter net revenue to be $6.4 billion, up 10% sequentially from Q3. This reflects an approximate mid-teens percentage sequential projected revenue increase in the semiconductor solutions side and a low single-digit percentage sequential revenue increase in infrastructure software.

總而言之，我們預計第四季淨收入為 64 億美元，比第三季環比成長 10%。這反映了半導體解決方案的預期收入環比增長率約為百分之十左右，而基礎設施軟體方面的環比收入增長率較低，為個位數百分比。

With that, I'll turn it over to Tom.

有了這個，我會把它交給湯姆。

Thank you, Hock. Let me provide some additional detail on our financial performance.

謝謝你，霍克。讓我提供一些有關我們財務表現的更多細節。

First, on the P&L, gross margins were a record 74% of revenue in the quarter and up approximately 110 basis points from Q2 and up approximately 320 basis points year-on-year. The year-on-year increase in software as a percentage of our overall revenue drove a large part of the increase.

首先，從損益表來看，本季毛利率創歷史新高，佔營收的 74%，比第二季成長約 110 個基點，年增約 320 個基點。軟體占我們總收入百分比的同比增長推動了這一增長的很大一部分。

Operating income from continuing operations was $3.2 billion and represented 55% of net revenue. Operating margins were up approximately 180 basis points quarter-over-quarter and year-on-year, primarily due to a decrease in operating expenses and better gross margin due to mix. Operating expenses were $1.1 billion, which was down $25 million compared to Q2. Adjusted EBITDA was $3.3 billion and represented 57% of net revenue. This figure excludes $138 million of depreciation.

持續經營業務的營業收入為 32 億美元，佔淨收入的 55%。營業利潤率較上月和年增約 180 個基點，主要是由於營業費用減少以及混合帶來的毛利率提高。營運支出為 11 億美元，比第二季減少 2,500 萬美元。調整後 EBITDA 為 33 億美元，佔淨收入的 57%。該數字不包括 1.38 億美元的折舊。

Looking at cash flow, we had record quarterly free cash flow of $3.1 billion, representing 53% of revenue. This is up a little more than 33% year-on-year.

從現金流來看，我們的季度自由現金流達到創紀錄的 31 億美元，佔營收的 53%。較去年同期成長略高於 33%。

Turning to capital allocation. In the quarter, we paid our common stockholders $1.3 billion of cash dividends. We also paid $192 million in withholding taxes due on vesting employee equity, resulting in elimination of approximately 700,000 AVGO shares. We ended the quarter with 404 million outstanding common shares and 451 million fully diluted shares. Note that we expect the fully diluted share count to stay at 451 million in Q4.

轉向資本配置。本季度，我們向普通股股東支付了 13 億美元的現金股利。我們也支付了 1.92 億美元的員工股權歸屬預扣稅，消除了約 70 萬股 A​​VGO 股票。本季末，我們擁有 4.04 億股已發行普通股和 4.51 億股完全稀釋股票。請注意，我們預計第四季度完全稀釋後的股票數量將保持在 4.51 億股。

On the financing and balance sheet front, we reduced total debt by $1.9 billion in the quarter. As we discussed on our last earnings call, we executed an $8 billion bond refinancing and $3.9 billion exchange offering. Through the refinancing and liability management activities we've undertaken this year, we've been able to push out our weighted average debt maturity to approximately 6 years and reduce our weighted average interest rate to approximately 3%. All told, we ended the quarter with $8.9 billion of cash and currently have $13.9 billion of liquidity, including our $5 billion revolver. We ended the quarter with $44 billion of total debt, of which approximately $800 million is short term. Finally, given our strong free cash flow generation and as we look to further deleverage the balance sheet, we plan to pay down an additional $3 billion of debt in our fiscal fourth quarter.

在融資和資產負債表方面，我們本季總債務減少了 19 億美元。正如我們在上次財報電話會議上討論的那樣，我們執行了 80 億美元的債券再融資和 39 億美元的交換發行。透過我們今年進行的再融資和負債管理活動，我們能夠將加權平均債務期限延長至約 6 年，並將加權平均利率降低至約 3%。總而言之，我們本季末擁有 89 億美元現金，目前擁有 139 億美元流動資金，其中包括我們 50 億美元的左輪手槍。本季結束時，我們的總債務為 440 億美元，其中約 8 億美元是短期債務。最後，鑑於我們強勁的自由現金流產生以及我們希望進一步去槓桿化資產負債表，我們計劃在第四財季額外償還 30 億美元的債務。

That concludes my prepared remarks. (Operator Instructions) Operator, please open up the call for questions.

我準備好的發言就到此結束。 （接線生說明）接線員，請撥打電話詢問問題。

(Operator Instructions) Our first question is Vivek Arya of Bank of America.

（操作員指令）我們的第一個問題是美國銀行的 Vivek Arya。

Actually, just a quick clarification and a question. Clarification, I just wanted to make sure your outlook kind of excludes or reflects if there are any restrictions on shipment to any Chinese customers. And then, Hock, my real question is on 5G. You gave us very good color on the near-term trends. But what have you seen in the first market for 5G, which was China? As the transition happened very quickly, the majority of phones there are now 5G. Do you see that to be the case for your exposure also in that a bigger percentage of the phones you're shipping into can be 5G so you see the content benefits faster than you might have thought before?

實際上，只是一個快速的澄清和一個問題。澄清一下，我只是想確保您的前景排除或反映了向任何中國客戶發貨是否有任何限制。然後，霍克，我真正的問題是關於 5G 的。您為我們提供了有關近期趨勢的非常好的資訊。但你在5G第一個市場——中國——看到了什麼？由於過渡發生得非常快，現在大多數手機都是 5G。您是否認為您的曝光情況也是如此，因為您發貨的手機中有更大比例可以是 5G，因此您看到內容受益的速度比您之前想像的更快？

By the way, to answer the first question, our current outlook covers all aspects, including what you indicated with regard to export restrictions and everything else. All those are comprehended. And as regards to 5G, we see the -- to be honest, we don't know -- if we're talking about devices, phones, it's -- that's an interesting question. It's very consumer-driven. And right now, to be honest about this, we don't know how fast the ramp on 5G will occur. I understand what you said about China and understand how operators might push to make that happen in terms of incentives. Where we stand at this point, we are seeing the demand more coming from our OEM -- key strategic OEM customers. And what we reflect is the demand that has been shared with us from our OEM customers.

順便說一下，回答第一個問題，我們目前的展望涵蓋了各個方面，包括你提到的有關出口限制和其他方面的內容。這些都明白了。至於 5G，我們看到——老實說，我們不知道——如果我們談論的是設備、手機——這是一個有趣的問題。這是非常受消費者驅動的。現在，說實話，我們不知道 5G 的發展速度會多快。我理解您對中國的看法，也理解營運商如何透過激勵措施推動實現這一目標。目前，我們看到更多的需求來自我們的 OEM——關鍵的策略 OEM 客戶。我們反映的是我們的 OEM 客戶與我們分享的需求。

Our next question comes from Ross Seymore of Deutsche Bank.

我們的下一個問題來自德意志銀行的羅斯·西莫爾。

Thanks for all the detail on the end markets on the semiconductor side. Hock, I wanted to dive a little bit into the networking portion where you said the cloud side and the telecom side is strong. There's been some fear in the end market as a whole that we're potentially entering a digestion phase from the cloud side of that equation. And then very recently, one of your pseudo-competitors talked about some service provider lull in demand there as well. It doesn't seem like you're seeing that. Is the end market different in your view? Is it weakening or not? Or are you just overcoming that with company-specific new product launches and ramps?

感謝您提供有關半導體終端市場的所有詳細資訊。 Hock，我想深入探討網路部分，您說雲端方面和電信方面很強大。整個終端市場有人擔心我們可能會從雲端方面進入消化階段。最近，您的一位偽競爭對手也談到了一些服務提供者的需求低迷。你似乎沒有看到這一點。您認為終端市場有什麼不同嗎？到底是削弱了還是沒有削弱？或者您只是透過公司特定的新產品發布和升級來克服這個問題？

Well they -- there's clearly -- we have clearly been helped by the fact that we have quite a few new programs, new products. Next-generation products, I would say, have been launched. And these are leadership products, as I've always indicated. So in that sense, we stand in a fairly unique position of being able to harvest or garner a lot of the share in that business. But based on what we are seeing, we're not seeing any weakness in the cloud nor in the telcos. We are, in fact, seeing continued sustained demand for the products -- for our networking products in these sectors.

嗯，很明顯，我們顯然得到了很多新項目、新產品這一事實的幫助。我想說，下一代產品已經推出。正如我一直指出的那樣，這些都是領先產品。因此，從這個意義上說，我們處於一個相當獨特的地位，能夠收穫或獲得該業務的大量份額。但根據我們所看到的情況，我們沒有看到雲端運算或電信公司有任何弱點。事實上，我們看到這些領域對我們的網路產品的持續需求。

Our next question comes from John Pitzer of Crédit Suisse.

我們的下一個問題來自瑞士信貸銀行的約翰‧皮策。

Hock, for obvious reasons, investors focus a lot of attention on the wireless handset cycle and your content growth there. I'm wondering if you could spend just a few minutes talking about the WiFi 6 uptake. You clearly, in your prepared comments, said that that's being a strong tailwind right now. Help us understand what inning of that upgrade cycle you think we're in. How does your content look as we go to WiFi 6? And do you think that this work-from-home phenomenon has put enough attention on the consumer that there's a big installed base upgrade cycle coming or not? How do you -- how could you help us characterize that?

霍克，出於顯而易見的原因，投資者將大量注意力集中在無線手機週期以及那裡的內容增長上。我想知道您是否可以花幾分鐘討論 WiFi 6 的採用情況。您在準備好的評論中顯然表示，這現在是一個強勁的推動力。幫助我們了解您認為我們正處於升級週期的哪個階段。當我們轉向 WiFi 6 時，您的內容看起來如何？您認為這種在家工作的現像是否已經引起消費者足夠的重視，是否會出現一個大的安裝基礎升級週期？你如何——你如何幫助我們描述這一點？

Okay. Well again, that's a very interesting question on WiFi 6 because, with regard to WiFi, that's a key franchise we invest a lot of resources into. We're talking about investing considerable dollars, R&D dollars, in this space because we are needed on 2 areas. As you probably know, we supply WiFi, the latest leadership products, in flagship phones, particularly in our strategic North American OEM. We provide all those WiFi/Bluetooth combo chips, which provides the latest features in those. And that's one area where we have a strong leadership position. We also have a very strong leadership position in WiFi 6, the current 802.11ax generation in access -- what they call, mention, access gateways. Basically, it's almost like home infrastructure, connectivity in the homes, connectivity in the offices, enterprises and offices, and connectivity that's provided now as service providers and telcos bring signals, bring -- basically bring data, video signals into houses -- into your homes.

好的。好吧，這又是一個關於 WiFi 6 的非常有趣的問題，因為就 WiFi 而言，這是我們投入大量資源的關鍵特許經營權。我們正在談論在這個領域投入大量資金，即研發資金，因為有兩個領域需要我們。您可能知道，我們在旗艦手機中提供 WiFi 這一最新的領先產品，特別是在我們的戰略性北美 OEM 中。我們提供所有這些 WiFi/藍牙組合晶片，其中提供了其中的最新功能。這就是我們擁有強大領導地位的領域。我們在 WiFi 6 領域也擁有非常強大的領導地位，即目前的 802.11ax 存取技術——他們稱之為存取網關。基本上，它幾乎就像家庭基礎設施，家庭中的連接，辦公室、企業和辦公室的連接，以及現在提供的連接，因為服務提供商和電信公司帶來了信號，基本上將數據、視頻信號帶入了你的家。家園。

And in this environment of work from home, we are seeing a strong surge of demand from telcos, service providers as they expand this WiFi service as part of broadband to the homes because those terminations, whether it's cable, fiber or copper DSL very often terminates in WiFi access gateways that allows the signals to be in the home. Also, we're also seeing that many homes, many consumers are themselves upgrading connectivity in their homes by going out and buying retail routers. As we all know it, WiFi retail route is the latest generation, which we are very well featured in for the own homes, and that's creating a very strong surge of demand of what I call broadband and what is a lot -- what a lot of it comprises WiFi 6.

在這種在家工作的環境中，我們看到電信公司和服務供應商的需求激增，因為他們將WiFi 服務擴展為家庭寬頻的一部分，因為這些終端（無論是電纜、光纖還是銅纜DSL）經常會終止在 WiFi 存取網關中，允許訊號進入家中。此外，我們還看到許多家庭、許多消費者自己透過外出購買零售路由器來升級家中的連線。眾所周知，WiFi 零售路線是最新一代，我們在自己的家庭中擁有非常出色的特色，這創造了對我所說的寬頻的需求的強勁增長，以及什麼是很多——什麼是許多其中包括WiFi 6。

Our next question comes from Craig Hettenbach of Morgan Stanley.

我們的下一個問題來自摩根士丹利的克雷格·赫滕巴赫。

Hock, I wanted to ask about the ASIC business and the building blocks you have there. I know you've seen strong growth in compute off-load. There was a story out last week, you might be working with Tesla on ASIC design. Can you just talk about the competitive strength you have for this technology and, importantly, how you allocate resources? Because I'm sure there might be more opportunities in terms of how you allocate and what you commit to.

Hock，我想詢問一下 ASIC 業務以及你們那裡的建置模組。我知道您已經看到計算卸載的強勁增長。上週有一個故事，你可能正在與 Tesla 合作進行 ASIC 設計。您能否談談您在這項技術方面的競爭優勢，以及更重要的是您如何分配資源？因為我確信在你如何分配和你承諾什麼方面可能會有更多的機會。

The ASIC business is something we've been doing for many, many years, and we got -- it's gone through various evolutions. But in many ways, we have gone from strength to strength simply because of the breadth of our portfolio of IP cores in silicon. Obviously, ASIC is still tied to silicon. We have a lot of it. We have lots of intellectual property capabilities, and we've been doing it for a long time. And I'll be honest, you make a lot more money -- it's a much more sustainable model running merchant silicon than in ASIC. It's a broader market. You create products that can be more innovative in many ways because you -- we include software with many of our merchant silicon, whether it's our switch, whether it's our broadband chips, WiFi chips. We provide SDK. We provide interface, software-driven, makes it programmable. All that gives it flexibility. ASIC is still a very core part of our business, and we do very well by it. And it's a business, though, we see that has certain limitations.

ASIC 業務是我們多年來一直在做的事情，而且我們經歷了各種演變。但在許多方面，我們的實力不斷增強，只是因為我們矽 IP 核子產品組合的廣度。顯然，ASIC 仍然與矽緊密相連。我們有很多。我們擁有大量的知識產權能力，而且我們已經這樣做了很長時間。老實說，你可以賺更多的錢——這是比 ASIC 更可持續的運行商業晶片的模型。這是一個更廣闊的市場。你創造的產品在許多方面都更具創新性，因為你——我們的許多商業晶片中都包含了軟體，無論是我們的交換機，無論是我們的寬頻晶片、WiFi 晶片。我們提供SDK。我們提供接口，軟體驅動，使其可編程。所有這些都賦予了它靈活性。 ASIC 仍然是我們業務的一個非常核心的部分，我們靠它做得很好。不過，我們認為這是一項業務有一定的限制。

Our next question comes from Stacy Rasgon of Bernstein Research.

我們的下一個問題來自伯恩斯坦研究中心的史黛西·拉斯貢（Stacy Rasgon）。

I wanted to ask you about lead times. I know you talked a lot about supply constraints last quarter and constraints that were potentially extending into the second half. Can you give us some feeling of where your lead times were maybe entering the quarter and now where they stand exiting the quarter? Have they come in? And what's the state of that -- of those supply constraints that you've talked about previously?

我想問你關於交貨時間的問題。我知道您談到了上個季度的供應限制以及可能延續到下半年的限制。您能否讓我們了解一下您進入本季的交貨時間以及現在離開本季的交貨時間？他們進來了嗎？您之前談到的供應限制狀況如何？

Good question, and especially following up from our last earnings call 3 months ago in the midst of COVID-19 situation at that time, as we are still by the way. But as you know, pre-COVID-19, as we got into fiscal '20 and the semiconductor industry started to improve, we had indicated and you all inferred, there were certain constraints, supply chain constraints, particularly in regard to wafers, especially leading-edge wafers, leading -- the most advanced node, leading-edge wafers and even then, substrates, particular substrates, that needed to package semiconductors. COVID-19 shows up, just creates a layer of complexity on supply chain. And the reason was, as we indicated 3 months ago, depending on where you outsource -- or where factories are, especially in Asia, parts of Asia, you face situations of lockdowns, operating under capacity.

這是一個很好的問題，特別是在 3 個月前，當時正值 COVID-19 疫情期間，我們對上次財報電話會議進行了跟進，因為我們仍然處於這種狀態。但如你所知，在COVID-19 之前，隨著我們進入20 財年，半導體產業開始改善，我們已經表示，你們都推斷，存在某些限制，供應鏈限制，特別是在晶圓方面，尤其是在晶圓方面。領先的晶圓，領先——最先進的節點，領先的晶圓，甚至是封裝半導體所需的基板，特別是基板。 COVID-19 的出現，只會讓供應鏈變得更加複雜。原因是，正如我們 3 個月前指出的那樣，根據您外包的地點或工廠所在的位置，尤其是在亞洲、亞洲部分地區，您將面臨封鎖、產能不足的情況。

And we faced them. We faced that for several months. Now that has normalized somewhat in terms of the back end where we have 10 assembly factories that were locked down or running below capacity. Most of that has been resolved. Having said that, the constraint on supply chain, constraint on wafers and substrates continues. And that's what we still face today. And so lead -- to be honest, our lead times are still very extended based on the technology nodes and the particular products that we produce and sell. And given the kind of products we do, we see some of that constraint. And I'll be direct, we could have shipped more in Q3 if such constraints were not as tight.

我們面對他們。我們面對這個問題已經好幾個月了。現在，在後端方面，情況已經正常化，我們有 10 家組裝工廠被鎖定或低於產能運作。大部分已經解決了。儘管如此，供應鏈的限制、晶圓和基板的限制仍在繼續。這就是我們今天仍然面臨的問題。因此，老實說，根據技術節點以及我們生產和銷售的特定產品，我們的交貨時間仍然很長。考慮到我們生產的產品類型，我們看到了一些限制。我會直接說，如果這些限制不那麼嚴格，我們本可以在第三季發貨更多。

Our next question comes from Harlan Sur of JPMorgan.

我們的下一個問題來自摩根大通的哈蘭‧蘇爾。

Congratulations on the solid execution and strong free cash flow. If I look at the free cash flow for the first 9 months of the fiscal year and your EBITDA guidance for Q4, sort of back of the envelope, I'm coming up with free cash flow growing year-over-year to around $11.5 billion for the fiscal year, which would imply that the team should be in a position to raise the dividend to at least $14, or probably more, from December of this year? Number one is, am I in the ballpark? And Tom, anything that we should be aware of in terms of working capital or collections that could impact the normalized free cash flow this fiscal quarter?

恭喜您穩健的執行力和強勁的自由現金流。如果我看一下本財年前 9 個月的自由現金流以及第四季度的 EBITDA 指導（大致情況），我會得出自由現金流逐年增長至 115 億美元左右對於本財年，這是否意味著團隊應該能夠從今年12 月起將股息提高到至少14 美元，或者可能更多？第一是，我在球場上嗎？湯姆，在營運資金或收款方面，我們應該注意哪些可能影響本財季正常化自由現金流的事情？

No, Harlan, your math is fairly spot on. I think we clearly are going to assess the dividend at the end of the year. But keep in mind, we are in a recession. We're still dealing with COVID. We've got an election coming. And so I think we want to wait, obviously, until we get to the end of the year, talk to the Board, look at the outlook for '21 before we jump to any conclusions. But you're right. I mean our capital allocation policy is to allocate approximately half of our free cash flow back to shareholders in the form of the dividend. We've had that in place now for several years, and we think that's the right approach. We're going to continue to take the other 50%, manage the balance sheet as we are this year.

不，哈倫，你的數學相當正確。我認為我們顯然將在年底評估股息。但請記住，我們正處於經濟衰退之中。我們仍在應對新冠肺炎疫情。我們即將舉行選舉。因此，我認為我們顯然要等到年底，與董事會交談，看看 21 年的前景，然後再得出任何結論。但你是對的。我的意思是，我們的資本分配政策是將大約一半的自由現金流以股利的形式分配給股東。我們已經這樣做了好幾年了，我們認為這是正確的方法。我們將繼續拿走另外 50%，像今年一樣管理資產負債表。

We paid down a considerable amount of debt by the end of this year, $5 billion, which we're happy with. We think the balance sheet is in a very good place as we exited fiscal '20. And then we're back to sort of, I think, a normal behavior in terms of looking at how to drive the total shareholder return above and beyond the dividend, allocating capital, either to M&A and/or to buybacks. And so we'll address the dividend question, as we always do, at the end of the fiscal year but look forward to executing in this quarter, posting results and then having that discussion.

到今年年底，我們還清了相當多的債務，達到 50 億美元，我們對此感到很滿意。我們認為，隨著 20 財年的結束，資產負債表處於非常好的狀態。然後，我認為，我們又回到了一種正常的行為，即考慮如何推動股東總回報高於股息，分配資本，無論是併購還是回購。因此，我們將像往常一樣在財政年度結束時解決股息問題，但期待在本季度執行，發布結果，然後進行討論。

Our next question comes from Toshiya Hari of Goldman Sachs.

我們的下一個問題來自高盛的 Toshiya Hari。

I wanted to ask about margins long term, your aspiration specifically. You're clearly executing really, really well in the near term, both at the gross margin level as well as the operating margin level. Tom, I guess, historically, you've talked about product mix and business mix being the key driver for gross margins. Is that still the case? Or are there specific levers that you can pull to potentially improve gross margins further? And I guess more importantly, how should we think about go-forward OpEx leverage given the current mix between semis and software?

我想詢問長期利潤率，特別是您的願望。顯然，無論是在毛利率水準還是營業利潤率水準上，你的近期執行情況都非常非常好。湯姆，我想，從歷史上看，您曾談到產品組合和業務組合是毛利率的關鍵驅動因素。現在還是這樣嗎？或者是否有可以進一步提高毛利率的具體手段？我想更重要的是，考慮到目前半成品和軟體之間的組合，我們應該如何考慮未來的營運支出槓桿？

Let me take the first part. Tom can give you the second part as we put in software. But on semiconductors particularly, and this is not a philosophy -- or this is not a model that we're just coming out with. It's always been there. It's the nature of technology and nature of the semiconductor technology markets. As you know, we have a broad portfolio of this franchise leadership products. And we come out with them, come out with next-generation products, in a very steady cadence of product life cycle. For instance, in wireless, our products come out every 12, 18 months, a new generation of products; in networking, 2, 3 years; storage, 4, 5 years; industrial, anywhere from 4 to 8 years. But it comes on.

讓我來看第一部分。湯姆可以為您提供我們放入軟體的第二部分。但特別是在半導體領域，這不是一種哲學，或者說這不是我們剛推出的模型。它一直都在那裡。這是技術的本質和半導體技術市場的本質。如您所知，我們擁有廣泛的特許經營領先產品組合。我們以非常穩定的產品生命週期節奏推出了它們，並推出了下一代產品。例如在無線領域，我們的產品每12、18個月就會推出新一代產品；網路專業，2、3年；儲存期4、5年；工業，4到8年不等。但它來了。

And that's why we put in the R&D to make sure our products create value for customers, each new generation adding more value. And with each generation that we add value, we have the opportunity to extract and ratchet up the value, financial value, for delivering on this much better, higher-performance products. It's a natural cycle. And so with revenue generation, your margin improves. Think about it, we have a range of about 16, 17 broad range of products in various end markets with different product cycles. You do go through that model. What we have seen empirically, over the last 10 years, is the gross margin of this mix of products grows naturally -- expands naturally 50 to 100 basis points each year. It comes with the nature of the business.

這就是為什麼我們投入研發以確保我們的產品為客戶創造價值，每一代產品都會增加更多價值。隨著我們每一代產品的增值，我們都有機會提取和提升價值、財務價值，以提供更好、更高性能的產品。這是一個自然循環。因此，隨著收入的增加，您的利潤率也會提高。想想看，我們在各個終端市場擁有大約 16、17 種廣泛的產品，具有不同的產品週期。你確實經歷了那個模型。根據我們的經驗，在過去 10 年裡，這種產品組合的毛利率自然增長——每年自然增長 50 到 100 個基點。它與業務的性質有關。

Yes. So I mean I think when you take that and you look at -- and we highlighted in the prepared remarks the semiconductor business turning the corner and now returning to growth, which I think is important. You layer in increasing diversification from software and the scale that affords us and, of course, the margins that it brings, especially with the synergies on the go-to-market that we're driving, I think over the horizon here, I think we see a path, frankly, of 30% to 60% EBITDA margins. I think that's the next stop. But I think Hock's right, we have consequently, over many, many years, by driving more content increase through R&D investments, been able to drive margins up incrementally and that will contribute to the overall success of the margin increases that we see coming.

是的。所以我的意思是，我認為當你考慮這一點時，你會看到——我們在準備好的評論中強調了半導體業務正在扭轉局面，現在正在恢復成長，我認為這很重要。你可以從軟體和規模上不斷增加多元化，當然還有它帶來的利潤，特別是我們正在推動的進入市場的協同效應，我認為在地平線上，我想坦率地說，我們看到EBITDA 利潤率為30% 到60%。我想那是下一站。但我認為霍克是對的，多年來，我們透過研發投資推動更多內容的增加，能夠逐步提高利潤率，這將有助於我們看到的利潤率成長的整體成功。

Our next question comes from Blayne Curtis of Barclays.

我們的下一個問題來自巴克萊銀行的布萊恩‧柯蒂斯。

I just want to ask on the networking segment, and thanks for all the detail on the segments. I guess, if you put all that in there, it looks like networking growth would actually accelerate, I mean, at double digits. So I'm just kind of curious, if you look at the 3 segments, service provider, data center and enterprise, just some comments. I know you have product cycles that are driving a lot of the growth but just kind of curious on your thoughts on the market embedded in that guidance.

我只想問有關網絡部分的問題，並感謝有關這些部分的所有詳細信息。我想，如果你把所有這些都放在那裡，看起來網路成長實際上會加速，我的意思是，以兩位數的速度。所以我只是有點好奇，如果你看看服務提供者、資料中心和企業這三個細分市場，我只是一些評論。我知道你們的產品週期推動了很大的成長，但我只是對你們對該指導中嵌入的市場的想法感到好奇。

Yes. So Blayne, I mean I think Hock talked about it, but I think it's clear cloud continues to grow for us. I think we have a very strong product cycle in telcos, which probably gets underappreciated, especially in the routing side. And then, look, we have a lot of different angles into enterprise, obviously, with the software portfolio, with Brocade on the fiber channel side, things we do within the server market. I mean it's clear that's slowing down. We saw that at the end of the third quarter. We're seeing that as we get into the end of the year. There's some indication, given the lead times we have, that actually that's stabilizing at these lower levels. I think it's a little bit too early to tell what's going to happen as we go into the beginning of the calendar year. But it's obvious to us, at least right now, it's cloud and telco driving that growth.

是的。 Blayne，我的意思是，我認為 Hock 談到了這一點，但我認為很明顯，雲端對我們來說持續成長。我認為我們在電信公司擁有非常強大的產品週期，但這可能沒有得到充分重視，特別是在路由方面。然後，看，我們對企業有很多不同的角度，顯然，透過軟體產品組合，博科在光纖通道方面，我們在伺服器市場中所做的事情。我的意思是，很明顯這種速度正在放緩。我們在第三季末看到了這一點。當我們進入年底時，我們就會看到這一點。有一些跡象表明，考慮到我們的交貨時間，實際上已經穩定在較低的水平。我認為現在判斷新年伊始會發生什麼事還為時過早。但對我們來說很明顯，至少現在是雲端和電信推動了這種成長。

Our next question comes from Harsh Kumar of Piper Sandler.

我們的下一個問題來自 Piper Sandler 的 Harsh Kumar。

First of all, congratulations on strong execution. Hock, I wanted to ask about, when I look at your software businesses, I see sometimes bookings in double digits, but the revenue growth is a lot lower than that. And I wanted to understand that mechanism why the revenues are always lagging your order growth rate. And then, are you done with the attrition of customers in Symantec? Or what is the expected time frame for that?

首先，祝賀執行力強。 Hock，我想問一下，當我查看你們的軟體業務時，我看到有時預訂量達到兩位數，但收入增長卻遠低於此。我想了解為什麼收入總是落後於訂單成長率的機制。那麼，賽門鐵克的客戶流失已經結束了嗎？或預計的時間範圍是多少？

Okay. By the way, the first part of that question is pretty interesting. Yes, that's almost -- the simplest way to look at it is we sign software contracts, whether it's on subscription or even on license and maintenance, for a 3-year term contracts, 3 years. So at any point in time, at any 1 year, you're really seeing only roughly 1/3 of our outstanding contract backlog coming up for renewals. And so we -- so for those 1/3 contracts, we are seeing that double-digit booking growth as we renew those contracts, bookings being referred to as renewals of those contracts. So when you take that part, and keep in mind, you still have the other 2/3 backlog that continues, we recognize revenue ratably, very much so.

好的。順便說一下，這個問題的第一部分非常有趣。是的，這幾乎是 - 最簡單的看待它的方式是我們簽署軟體合同，無論是訂閱還是許可和維護，為期 3 年的定期合同，3 年。因此，在任何時間點、任何一年，您實際上只會看到大約 1/3 的未完成合約積壓需要續約。因此，對於這 1/3 的合同，我們在續簽這些合約時看到了兩位數的預訂增長，預訂被稱為這些合約的續約。因此，當您考慮這一部分時，請記住，您還有另外 2/3 的積壓訂單仍在繼續，我們會按比例確認收入，非常如此。

Every contract we sign up at renewal, we rate -- we recognize revenue ratably over 3 years so you have to dilute that in. And that's why what happens is that double-digit bookings rate increase translates when it's diluted with the rest of the backlog that is chugging along steadily flat to effectively a mid-single-digit growth rate in revenue. That's the way the math works. And we've been able to do that very, very well, especially in our core accounts.

我們在續約時簽訂的每份合約都會進行評級——我們會在3 年內按比例確認收入，因此您必須將其稀釋。這就是為什麼會出現兩位數的預訂率增長，當它被其餘的積壓訂單稀釋時，就會發生這種情況。收入穩定且穩定成長，實際上達到了中個位數的成長率。這就是數學的運作方式。我們已經能夠做得非常非常好，特別是在我們的核心帳戶中。

Next question comes from Edward Snyder of Charter Equity.

下一個問題來自 Charter Equity 的愛德華·斯奈德。

Your wireless business is booming, obviously, on the 5G release with your largest customer, but maybe we can talk about a little bit longer term. There's no secret, your largest customers' largest initiative is to do their own baseband modem. And I mean that's a job unto itself. The interface, the entire RF front end, has to usually be designed by somebody other than the baseband guys. That's the case for all baseband providers now. In fact, most baseband from MediaTek to Qualcomm are turning to the incumbents, the large RF semi companies, to do the actual architecture design itself.

顯然，隨著您最大客戶的 5G 發布，您的無線業務正在蓬勃發展，但也許我們可以討論更長遠的問題。眾所周知，您最大的客戶的最大舉措就是製作自己的基頻調變解調器。我的意思是，這本身就是一項工作。接口，整個射頻前端，通常必須由基帶人員以外的其他人設計。現在所有基帶提供者都是如此。事實上，從聯發科到高通，大多數基頻都轉向現有的大型射頻半導體公司來自行實際的架構設計。

Since you are the strategic partner for the largest portion of that, is it fair to assume that you will be intimately involved in this? And does that change the nature of your relationship in terms of revenue growth or margins? Because this is a once in a company history event for your largest customer, if they can get it working, they're going to need all the help they can get. So how does this affect the margin profile and, more importantly, the revenue growth over the next 2, 3 years in wireless?

由於您是其中最大部分的策略夥伴，是否可以假設您將密切參與其中？這是否會改變你們在收入成長或利潤方面的關係性質？因為對於您最大的客戶來說，這是公司歷史上一次的事件，如果他們能夠讓它發揮作用，他們將需要他們可以獲得的所有幫助。那麼，這將如何影響無線業務的利潤率，更重要的是，未來 2、3 年的營收成長？

Ed, I love the fact that you know so much about this business. And equally, you will know, I can't comment on that, sorry.

艾德，我喜歡你對這個行業如此了解。同樣，你會知道，我無法對此發表評論，抱歉。

Our final question comes from of C.J. Muse of Evercore.

我們的最後一個問題來自 Evercore 的 C.J. Muse。

I guess just a follow-up. You talked about extended lead times, you talked about wireless growing into fiscal Q1 and you also highlighted the semiconductor solutions sustaining into Q1. So as we put all that together and obvious strength, particularly of the networking side, is it fair to say that semiconductor should grow again into January?

我想這只是後續行動。您談到了延長交貨時間，談到了無線業務發展到第一財季，您也強調了持續到第一財季的半導體解決方案。因此，當我們將所有這些和明顯的優勢（尤其是網路方面）放在一起時，可以公平地說半導體應該在 1 月再次增長嗎？

Yes, C.J. I mean I think what we wanted to highlight was, given the shift in the product launch for the big phone customer, we wanted to give some color on how that translates into Q1 since that doesn't happen very often. I think I can recall it happening a couple of years ago, it doesn't happen very often. And I think we also wanted to be clear, given the lead times, that we do have reason of visibility, especially into some of the growth areas like networking that we talked about. And so we do feel comfortable. I think this is the first quarter in a while where semiconductor is going to be up year-over-year. And as you look into Q1, we feel comfortable that we can sustain that.

是的，C.J. 我的意思是，我認為我們想要強調的是，考慮到針對大型手機客戶的產品發布的轉變，我們希望對第一季度的情況進行一些說明，因為這種情況並不經常發生。我想我還記得幾年前發生過這樣的事，但這種情況並不常發生。我認為我們還想明確一點，考慮到交付時間，我們確實有理由提高可見性，特別是在我們談到的網路等一些成長領域。所以我們確實覺得很舒服。我認為這是一段時間以來半導體行業同比增長的第一個季度。當你看到第一季時，我們感到很放心，我們可以維持這一點。

Thank you. I would now like to turn the call back over to Ms. Russotto for any closing remarks.

謝謝。我現在想將電話轉回給 Russotto 女士，讓其結束語。

Thank you, operator. So in closing, we did want to note that Hock will be presenting virtually at the Deutsche Bank Technology Conference on Tuesday, September 15.

謝謝你，接線生。最後，我們確實想指出，Hock 將於 9 月 15 日星期二在德意志銀行技術會議上進行虛擬演講。

And with that, that will conclude our earnings call today, and we thank you all for joining. Operator, you may end the call.

我們今天的財報電話會議到此結束，我們感謝大家的加入。接線員，您可以結束通話了。

Thank you. Ladies and gentlemen, this does conclude today's conference. Thank you for participating. You may all disconnect. Have a great day.

謝謝。女士們、先生們，今天的會議到此結束。感謝您的參與。你們都可以斷開連線。祝你有美好的一天。