Bel Fuse Inc (BELFA) 2025 Q2 法說會逐字稿

Good morning and welcome to the Bel Fuse second-quarter 2025 earnings call.

早安，歡迎參加 Bel Fuse 2025 年第二季財報電話會議。

(Operator Instructions)

（操作員指示）

I would now like to turn the call over to Jean Marie Young with Three Part Advisors. Please go ahead, Jean.

現在我想將電話轉給 Three Part Advisors 的 Jean Marie Young。請繼續，Jean。

Thank you and good morning everyone. Before we begin, I'd like to remind everyone that during today's conference call, we will make statements relating to our business that will be considered forward-looking statements under federal securities laws, such as statements regarding the company's expected operating and financial performance.

謝謝大家，早安。在我們開始之前，我想提醒大家，在今天的電話會議中，我們將做出與我們的業務有關的聲明，這些聲明將根據聯邦證券法被視為前瞻性聲明，例如有關公司預期運營和財務業績的聲明。

For future periods, including guidance for future periods in 2025. These statements are based on the company's current expectations and reflect the company's views only as of today and should not be considered representative of the company's views as of any subsequent date. The company disclaims any obligation to update any forward-looking statements or outlook. Actual results for future periods may differ materially from those projected by these forward-looking statements due to a number of risks, uncertainties, and other factors.

對於未來時期，包括 2025 年未來時期的指導。這些聲明是基於公司目前的預期，僅反映公司截至今天的觀點，不應被視為代表公司在任何後續日期的觀點。本公司不承擔更新任何前瞻性陳述或展望的義務。由於多種風險、不確定性和其他因素，未來期間的實際結果可能與這些前瞻性陳述所預測的結果有重大差異。

These material risks are summarized in the press release that we issued after market closed yesterday. Additional information about the material risks and other important factors that could potentially impact our financial performance, and cause actual results to differ materially from our expectations as discussed in our filings with the Securities and Exchange Commission, including our most recent annual report on Form 10-K and our quarterly reports and other documents that we have filed or may filed with the FCC from time to time.

我們在昨天收盤後發布的新聞稿中總結了這些重大風險。有關可能影響我們財務業績並導致實際結果與預期存在重大差異的重大風險和其他重要因素的其他信息，如我們向美國證券交易委員會提交的文件中所述，包括我們最近的 10-K 表年度報告以及我們已經或可能不時向美國聯邦通信委員會提交的季度報告和其他文件。

May also discuss non-gap results during this call, and reconciliations of our GAAP results, non-gap results have been included in our press release. Our press release and our SEC filings are all available on the IR section of our website. Joining me on the call today are Farouq Tuweiq, President and CEO; and Lynn Hutkin, CFO.

也可以在本次電話會議中討論非差距結果，而我們的 GAAP 結果的調整、非差距結果已包含在我們的新聞稿中。我們的新聞稿和美國證券交易委員會 (SEC) 文件均可在我們網站的 IR 部分查閱。今天與我一起參加電話會議的還有總裁兼執行長 Farouq Tuweiq 和財務長 Lynn Hutkin。

With that, I'd like to turn the call over to Farouq.

說完這些，我想把電話轉給法魯克。

Thank you, Jean, and good morning, everyone. We are very pleased with our second-quarter performance, which surpassed our revenue expectations and delivered gross margins at the higher end of our projected range.

謝謝你，Jean，大家早安。我們對第二季的業績非常滿意，其收入超出了我們的預期，毛利率也達到了預期範圍的較高水平。

The Bel team really came through strong aid came through strong, aided by a few factors including in market performance and an uptick in our intra quarter turns which we have not really seen much in recent quarters, particularly in our power magnetic segments. From an in-market standpoint, commercial air defense and networking led the way along with certain pockets of distribution sales within the power and magnetic segments.

Bel 團隊確實在強大的援助下取得了成功，這得益於幾個因素，包括市場表現和季度內轉變的上升，這在最近幾個季度我們並沒有真正看到，特別是在我們的電力磁性領域。從市場角度來看，商業防空和網路以及電力和磁性領域的某些分銷銷售領域處於領先地位。

These trends signal that we are heading into recovery as we have been anticipating following nearly two years of inventory destocking in the channel. And they reinforce our confidence and continued growth as we move into the second half of the year, setting aside some of the geopolitical noise around tariffs. During our last-quarterly call, the potential effects of tariffs on our sales and margins were uncertain. In retrospect, tariffs had a limited impact in the second-quarter, accounting for about $2 million of our sales and having a minimal effect on margins.

這些趨勢表明，正如我們在通路近兩年去庫存化之後所預期的那樣，我們正在走向復甦。隨著我們進入下半年，這些舉措增強了我們的信心，並推動了持續成長，同時消除了圍繞關稅的一些地緣政治噪音。在我們上一季的電話會議上，關稅對我們的銷售額和利潤率的潛在影響尚不確定。回想起來，關稅對第二季的影響有限，約占我們銷售額的 200 萬美元，對利潤率的影響微乎其微。

Although we have slightly better clarity now, there are still many variables at play regarding tariffs, and we will continue to adapt to this evolving landscape and collaboration with our suppliers and customers. Overall, we are encouraged by the strong results this quarter and are excited by the momentum building within the business as we head into the second-half of the year.

儘管我們現在有了更好的了解，但關稅方面仍然存在許多變數，我們將繼續適應這種不斷變化的情況並與我們的供應商和客戶合作。總體而言，我們對本季的強勁業績感到鼓舞，並對進入下半年業務的成長勢頭感到興奮。

Looking ahead to the third-quarter, we are optimistic about continued growth with sales guidance in the range of $165million to $180 million, and gross margins projected between 37% and 39%. Strong bookings and Q2 support our expectation of sequential growth for the remainder of the year, and we remain confident in our ability to deliver value to both our customers and shareholders.

展望第三季度，我們對持續成長持樂觀態度，銷售額預期在 1.65 億美元至 1.8 億美元之間，毛利率預計在 37% 至 39% 之間。強勁的預訂量和第二季業績支持了我們對今年剩餘時間連續成長的預期，我們仍然有信心為客戶和股東創造價值。

With that, I'll turn the call over to Lynn to run through financial highlights from the quarter. Lynn.

說完這些，我將把電話轉給 Lynn，讓她介紹本季的財務亮點。林恩。

Thank you, Farouq. From a financial perspective, sales for the second quarter of 2025 has reached $168.3 million, reflecting an increase of 26.3% from the second quarter of 2024.

謝謝你，法魯克。從財務角度來看，2025 年第二季的銷售額達到 1.683 億美元，較 2024 年第二季成長 26.3%。

Strong performance in our AMD and market and improved sales in our magnetic segment, helped offset the year per year decline in our consumer, rail, and immobility and markets within our power segment during the second-quarter of 2025 compared to the same period of 2024. Turning to our product groups, sales of power solutions and protection in the second quarter of 2025 amounted to $86.8 million, representing an increase of 48.2% compared to the same period last year.

我們的 AMD 和市場表現強勁，磁性部門銷售額成長，有助於抵消 2025 年第二季與 2024 年同期相比，我們電力部門內的消費者、鐵路和不動產和市場逐年下滑的現象。談到我們的產品組，2025 年第二季電源解決方案和保護的銷售額達到 8,680 萬美元，比去年同期成長 48.2%。

This growth was largely driven by our aerospace and defense exposure, which contributed $32.6 million to the power segment for the second quarter of 2025. On the consumer side, sales decreased by $1.7 million in Q2 '25 compared to Q2 '24, primarily due to the trade restriction imposed on one of our suppliers in China, as mentioned in prior earnings polls.

這一成長主要得益於我們的航空航太和國防業務，這為 2025 年第二季的電力部門貢獻了 3,260 萬美元。在消費者方面，2025 年第二季的銷售額與 2024 年第二季相比減少了 170 萬美元，這主要是由於我們在中國的一家供應商受到了貿易限制，正如先前的收益調查中所提到的。

Additionally, given that e-mobility sales were still robust in Q2 '24, we saw a $2.3 million year-for-year decline in the Fen market in Q2 '25. Sales into the rail end market have been normalizing in 2025, coming off a strong 2024, resulting in a $3.3 million reduction during Q2 '25 compared to the same period in 2024. AC clients were partially offset by a $2.3 million increase in sales to our AI customers, bringing total AI sales for Q2 '25 to $2.6 million. Further, circuit protection sales increased by $1.8 million in Q2 '25 compared to Q2 '24.

此外，鑑於 2024 年第二季電動車銷售依然強勁，我們看到 2025 年第二季芬蘭市場年減了 230 萬美元。2025 年，鐵路終端市場的銷售趨於正常化，2024 年的銷售表現強勁，導致 2025 年第二季的銷售額與 2024 年同期相比減少了 330 萬美元。AC 客戶的銷售額因我們 AI 客戶的銷售額增加 230 萬美元而部分抵消，使 2025 年第二季的 AI 總銷售額達到 260 萬美元。此外，2025 年第二季的電路保護銷售額與 2024 年第二季相比增加了 180 萬美元。

The gross margin for the power segment in the second quarter of 2025 was 41.9%, representing a decline of 380 basis points from Q2 '24. If you recall, we had pulled out in last year's second quarter that approximately 400 basis points of the power gross margin resulted from non-recurring items that were reported at 100% gross margin in Q2 '24, such as cancellation fees.

2025 年第二季電力部門的毛利率為 41.9%，較 2024 年第二季下降 380 個基點。如果你還記得的話，我們在去年第二季就指出，電力毛利率中約有 400 個基點來自非經常性項目，這些項目在 2024 年第二季報告的毛利率為 100%，例如取消費。

Adjusting for that, power margins were up slightly from Q2 '24 due to the inclusion of the higher margin intercom products. Turning to our connectivity solutions group, sales for Q2 '25 reached $59.2 million, an increase of 2.4% compared to Q2 '24. Sales for commercial air applications and Q2 '25 were $20.5 million, which represented an increase of $5.1 million or 33% from Q2 '24.

經過調整，由於納入了利潤率較高的對講機產品，電力利潤率較 2024 年第二季略有上升。談到我們的連結解決方案集團，2025 年第二季的銷售額達到 5,920 萬美元，與 2024 年第二季相比成長了 2.4%。2025 年第二季商業空氣應用的銷售額為 2,050 萬美元，比 2024 年第二季增加 510 萬美元，增幅為 33%。

Connectivity products sold into defense applications totaled $13.4 million in Q2 '25, an increase of 12% from Q2 '24. And sales into the space and market amounted to $2.3 million in Q2 '25, the same level as in Q2 '24. The gross margin for this group was 39.2% in the second quarter of 2025, representing an improvement of 30 basis points from Q2 '24.

2025 年第二季度，國防應用連結產品的銷售額總計 1,340 萬美元，較 2024 年第二季成長 12%。2025 年第二季度，該空間和市場的銷售額達到 230 萬美元，與 2024 年第二季度持平。2025 年第二季度，該集團的毛利率為 39.2%，比 2024 年第二季度提高了 30 個基點。

This margin expansion was largely attributable to operational efficiencies achieved through facility consolidations completed in 2024, along with favorable foreign exchange impacts related to the peso compared to the 2024 period. These positive drivers were partially offset by minimum wage increases in Mexico that took effect in 2025.

利潤率的擴大主要歸功於 2024 年完成的設施整合所帶來的營運效率的提高，以及與 2024 年同期相比比索相關的有利外匯影響。墨西哥將於 2025 年上調最低工資標準，但部分抵消了這些積極因素的影響。

Lastly, in the second quarter of 2025, our magnetic Solutions Group recorded sales of $22.3 million, representing an increase of 32.5% compared to the second quarter of 2024. But I rebound in demand from our networking customers and through the distribution channel.

最後，2025 年第二季度，我們的磁性解決方案集團的銷售額為 2,230 萬美元，與 2024 年第二季度相比成長了 32.5%。但我們的網路客戶和分銷管道的需求出現反彈。

This level of growth aligns with expectations discussed during last quarter's earnings call, where we know that this segment would be our highest percentage grower in 2025. The gross margin for the magnetics group improved to 28.7% in Q2 '25 compared to 26.4% in Q2 '24, marking an improvement of 230 basis points year over year. This increase in margin was primarily driven by the higher sales volume in Q2 '25, as well as improved operational efficiencies from the recent facility consolidations in China.

這一成長水準與上個季度財報電話會議上討論的預期一致，我們知道這一細分市場將成為 2025 年成長百分比最高的部分。磁性元件集團的毛利率從 2024 年第二季的 26.4% 提高到 2025 年第二季的 28.7%，年增 230 個基點。利潤率的成長主要得益於 2025 年第二季的銷售量增加，以及近期中國工廠整合帶來的營運效率提高。

R&D expenses reached $8.1 million in Q2 '25, a higher level compared to Q2 '24, primarily due to the acquisition of Entercom. Our annual compensation increases also now occur in March each year, and this also contributed to the higher expense in Q2 '25.

2025 年第二季研發費用達到 810 萬美元，與 2024 年第二季相比有所上升，主要是因為收購了 Entercom。我們的年度薪資成長現在也發生在每年 3 月，這也導致了 25 年第二季的支出增加。

They expect future quarters to generally align with the Q2 '25. Selling, general and administrative expenses totaled $30.9 million, representing 18.4% of sales. Compared to the prior year, SG&A increased by $6.8 million in the second quarter of 2025.

他們預計未來幾季的表現將與 2025 年第二季基本一致。銷售、一般及行政費用總計 3,090 萬美元，佔銷售額的 18.4%。與前一年相比，2025 年第二季銷售、一般及行政費用增加了 680 萬美元。

The increase was primarily driven by Intercom's SG&A expenses, which contributed $6 million in the second quarter of 2025. In addition to annual compensation adjustments that took effect in March 25 and higher than anticipated medical claims during the second quarter of 2025.

這一成長主要得益於 Intercom 的銷售、一般及行政費用，該費用在 2025 年第二季貢獻了 600 萬美元。除了 3 月 25 日生效的年度薪資調整以及 2025 年第二季高於預期的醫療索賠。

One last item to note on the P&L side as we look to Q3 is the foreign exchange environment that we're currently in and the weakening US dollar versus each of the three currencies that has exposure to, namely the Chinese remedy, the Mexican peso, and the Israeli shekel.

展望第三季度，損益方面最後要注意的一點是，我們目前所處的外匯環境以及美元兌三種受影響貨幣（即中國藥品、墨西哥比索和以色列謝克爾）的疲軟。

We have hedging programs in place for each of these currencies to help mitigate some of the financial impacts of the movements in these rates, but our gross margin guide for Q3 of 37% to 39% does factor in some potential downward pressure related to FX. Looking at our balance sheet and cash flow, we finished the quarter with $59.3 million in cash and securities.

我們針對每種貨幣都制定了對沖計劃，以幫助減輕這些匯率變動帶來的一些財務影響，但我們第三季 37% 至 39% 的毛利率指引確實考慮了與外匯相關的一些潛在下行壓力。查看我們的資產負債表和現金流，本季末我們擁有 5,930 萬美元的現金和證券。

During the second quarter of 2025, we utilized $30 million of cash for repayment of long-term debt. This paydown in the second quarter alone results in a $1.7 million reduction in our annual interest expense. Other cash uses during the quarter included $3.9 million on capital expenditures and dividend payments of $800,000.

2025 年第二季度，我們使用 3,000 萬美元現金償還長期債務。光是第二季的這筆還款就使我們的年度利息支出減少了 170 萬美元。本季的其他現金使用包括 390 萬美元的資本支出和 80 萬美元的股息支付。

These payments were largely offset by $20.7 million in cash flow generated from operating activities during the second-quarter. That concludes our commentary on the second-quarter results, and I'd now like to turn the call back to the operator to open the call for Questions.

這些付款大部分被第二季營運活動產生的 2,070 萬美元現金流所抵銷。我們對第二季業績的評論到此結束，現在我想將電話轉回給接線員，開始提問。

(Operator Instructions) Bobby Brooks, Northland Capital Markets

（操作員指示）Bobby Brooks，Northland Capital Markets

Hey, good morning, guys, and congrats on the outstanding quarter. I was curious to hear a bit more about the trends you're seeing that underpin the guidance. The press release mentioned a rebound and networking and some other segments within the distribution along with the strong Q2 bookings which I think you said leads you to believe that you're going to see sequential growth in the back half. Maybe could we just expand on that and is it all customers returning to normal ordering patterns, new customers coming into the fold or maybe something different?

嘿，大家早安，恭喜你們本季取得了優異的成績。我很好奇想聽聽您所看到的支撐該指導的趨勢。新聞稿中提到了反彈、網絡和分銷中的一些其他部分，以及強勁的第二季度預訂量，我認為您所說的這些讓您相信您將在下半年看到連續增長。也許我們可以進一步闡述這一點，是否所有顧客都恢復了正常的訂購模式，還是有新顧客加入，或者還有其他情況？

Yeah, so Bobby, what we had talked about earlier in the year is that orders had started to pick up in the 1st quarter, and we saw that trend continue in the second quarter. A lot of that has to do with the expected rebounding in networking, which largely impacts the power and magnetics groups, and then also within the distribution channel.

是的，Bobby，我們在今年稍早談到的是，訂單在第一季開始回升，我們看到這一趨勢在第二季度繼續延續。這在很大程度上與網路預期的反彈有關，這在很大程度上影響了電源和磁性組，同時也影響了分銷管道。

So, if you recall, with connectivity, distribution had been fairly stable over the last couple of years for the connectivity segment, but it had been depressed with the overstocking situation in the power and magnetic segments. So that's where we're seeing the rebound in orders, and we're that's what we saw coming through in the second quarter, and we continue to see that trend moving forward into the second half of the year.

所以，如果你還記得的話，在過去幾年中，連接領域的分銷一直相當穩定，但由於電力和磁性領域的庫存過剩情況，分銷一直處於低迷狀態。這就是我們看到的訂單反彈，也是我們在第二季度看到的反彈，而我們繼續看到這種趨勢延續到今年下半年。

Got it. So not so it seems like just kind of a return to norm there not necessarily new customers or just any kind of commentary on maybe new business ones.

知道了。所以事實並非如此，這似乎只是一種回歸常態，不一定有新客戶，也不一定是對新業務的任何評論。

Yeah, I would say, I mean, we remember Bobby, we go through distribution. There's some quick term business and things like fuses, right? So there, we do have new wins and customers that do occur. But for given our long cycle on average design business, you need a return to growth both from your OEMs and your DT.

是的，我想說，我的意思是，我們記得鮑比，我們經歷了分銷。有一些短期業務和保險絲之類的東西，對嗎？因此，我們確實獲得了新的勝利和客戶。但考慮到我們的平均設計業務週期較長，您需要從 OEM 和 DT 兩個方面恢復成長。

DT obviously does touch a lot of new customers along the way and some recurring. So, when we look at the channels, yes, we do see some new business and we have some really nice new wins in the quarter programs in our aerospace defense business, for example, so we do see new, but just given the long side on the business, you need your existing people with too much inventory to wake up and get going again. So it's really an amalgamation of those factors.

DT 顯然在這過程中接觸到了很多新客戶和一些回頭客。因此，當我們查看管道時，是的，我們確實看到了一些新業務，例如，我們在航空航天國防業務的季度計劃中取得了一些非常好的新勝利，所以我們確實看到了新業務，但考慮到業務的多頭，你需要現有的庫存過多的人醒來並重新開始工作。所以這其實是這些因素的融合。

Fair enough. That's helpful caller and then just maybe any other strategic growth initiatives or kind of margin enhancements plans through the rest of the year, that should be on your radar or is it more so just a continuous operational excellence and driving just general business efficiency and maybe to dovetail that with the Glen Rock Pennsylvania facility sale. Can you re I think that was in the connectivity segment, but could you remind us kind of the rationale behind that and is there any other facilities that you might be eyeing to sell?

很公平。這對來電者很有幫助，然後也許在今年剩餘時間內任何其他戰略增長計劃或利潤率提升計劃都應該在您的關注範圍內，或者這僅僅是持續的卓越運營和推動總體業務效率，並可能與賓夕法尼亞州格倫羅克工廠的銷售相吻合。您能否重新考慮？我認為這是在連接部分，但您能否提醒我們這背後的理由，以及您是否還有其他可能想要出售的設施？

Yeah, so maybe starting out backwards here a little bit on the Glen Rock piece that was, I think we announced that Q1 last year or February call last year in 2024, if I recall correctly, and we were looking to drive margin improvements and drive efficiencies within the connectivity business, so better aligned internal resources and a physical footprint space.

是的，所以也許從 Glen Rock 的部分開始稍微回顧一下，如果我沒記錯的話，我記得我們去年第一季度或去年 2 月宣布了 2024 年的計劃，我們希望提高利潤率並提高連接業務的效率，從而更好地協調內部資源和物理足跡空間。

So that's kind of really was the just of that, and we've largely kind of moved out of the equipment and we've had the building held for sale for a while, but obviously just given the environment there, it took a little bit longer to sell because we also want to make sure we got good value for it and here we are now we announced that.

所以這確實就是這樣，我們基本上已經搬出了設備，並且我們已經將建築物出售了一段時間，但顯然考慮到那裡的環境，出售需要更長的時間，因為我們還想確保我們能獲得良好的價值，現在我們宣布了這一點。

Which obviously allowed us to generate some cash from the sale and then also pay down some debts. In terms of other buildings for sale, nothing for us to talk about at this point. I think the buildings that we own have significantly gone down in number and count because remember we have one currently kind of held for sale if you will, but nothing kind of new beyond that for the time being.

這顯然使我們能夠從銷售中獲得一些現金，然後還清一些債務。關於其他待售建築物，目前我們還沒有什麼可談的。我認為我們擁有的建築物的數量和數量已經大幅下降，因為請記住，我們目前有一棟建築物處於待售狀態，但除此之外暫時沒有任何新建築物。

When we look at strategic initiatives, we have strategic initiatives going on, seemingly constantly across the organization of different scale and magnitude, and as we've kind of gone into this week here leading up to this call with the senior team and kind of hearing and talking about what we're doing in business and the travels that we've done throughout the second quarter, there's a lot of energy and excitement and quite frankly, the team is very busy.

當我們審視戰略舉措時，我們似乎在整個組織內不斷實施著不同規模和程度的戰略舉措，本週我們與高層團隊召開了電話會議，聽取並討論了我們在第二季度開展的業務和旅行情況，大家充滿活力和興奮，坦率地說，整個團隊都非常忙碌。

And I think the no guiding star here is always for us is how do we grow and how can we grow more, and we got to play to win and be efficient in in our way to go for it. As we've talked in the past putting the margin expansion to your question, Bobby, obviously we have a mixed issue, right, where magnetics is a lower margin business, that kind of was a grower for us.

我認為這裡對我們來說沒有指導星，我們總是在思考如何成長以及如何成長更多，我們必須努力取勝，並以高效的方式去實現目標。正如我們過去談到的關於利潤率擴大的問題一樣，Bobby，顯然我們有一個混合問題，對吧，磁性材料是一個利潤率較低的業務，但這對我們來說卻是一個成長點。

So just putting that aside for a second, we always do challenge margins, where can we do more, where can we do better, how can we be better? I think we also need to be realistic in where we sit today on the margin side. We are probably industry leading if not in the 80th percentile, 75th percentile here if we're going to throw a guess out there.

所以，暫時把這一點放在一邊，我們總是在挑戰極限，我們可以在哪些方面做得更多，我們可以在哪些方面做得更好，我們如何做得更好？我認為，我們還需要現實地看待我們目前在利潤方面的處境。如果我們猜測的話，即使不是 80% 或 75% 的話，我們也可能處於行業領先地位。

So we are in a very good place and a comfortable place. The question becomes, is, can we, there might be some room to go here and there, but we also need to be smart about it, make sure we don't dig out because ultimately we have a, let's say a very high percentage of our ops and R&D sticks we've got to make sure that we are, putting that part of our P&L to work.

因此，我們處於一個非常好、非常舒適的位置。問題是，我們是否可以，可能有一些空間可以去，但我們也需要聰明地對待它，確保我們不會挖掘出來，因為最終我們有一個，假設我們的運營和研發堅持的很高比例，我們必須確保我們將我們的損益表的這一部分投入使用。

So yes, we're always minded on margins. There might be an opportunity to push up. But at the same time we need to be smart about it. So we're comfortable with where they're at today on the gross margin side. We're trending a little bit more in the writer direction on the side, but we just want to be careful that there's not another 1,000 bits expansion here, right?

是的，我們總是關注利潤。或許有機會上漲。但同時，我們也需要明智地對待它。因此，我們對他們目前的毛利率水準感到滿意。我們在編寫方向上更趨向於一些，但我們只是想小心，不要在這裡再進行 1,000 位元擴展，對嗎？

Yeah, great commentary. I'll return it to you. Thank you.

是的，很棒的評論。我會把它還給你。謝謝。

You guys. Bye.

你們。再見。

Christopher Glenn, Oppenheimer.

克里斯托弗·格倫，奧本海默。

Thanks. Good morning. So, yeah, you talked about, improving orders trends in the first quarter, continuing to the second quarter. You also, I think mentioned, improving turns in quarter sounded a little bit more like a pivot dynamic that you saw, I guess perhaps shortly after the last earnings call so just kind wondering if we could dive into that cadence a little bit.

謝謝。早安.是的，您談到了第一季訂單趨勢的改善，並且這種趨勢將持續到第二季​​。我想您也提到過，季度業績的改善聽起來更像是您所看到的一個關鍵動態，我想也許是在上次財報電話會議後不久，所以我只是想知道我們是否可以深入了解一下這種節奏。

Yeah, when we look at normal times, which means you'd probably have to go back four or five years ago, but usually you'd head into the quarter with some expectation of go get. In those days, let's say we have a lot of skews, but generally your lead times are anywhere from 8 weeks to 12 weeks, let's say, right? So, the things that were a little bit more quicker turns, you would see some of that in quarter turn.

是的，當我們回顧正常時期時，這意味著你可能必須回到四、五年前，但通常你會帶著一些期望進入本季。在那些日子裡，假設我們有很多偏差，但一般來說，您的交貨時間是在 8 週到 12 週之間，對嗎？因此，對於轉彎速度稍快一點的物體，您會在四分之一轉彎時看到一些。

Obviously, we headed into COVID and post-COVID year where there was extended lead times, so we didn't really see much of that intra quarter turns and then we head into over inventory in the channel, right, which just kind of slows everything down.

顯然，我們進入了新冠疫情和後新冠疫情時期，交貨時間都延長了，所以我們並沒有真正看到季度內轉變的現象，然後我們又陷入了渠道庫存過剩的境地，這多少減慢了一切的速度。

But today, especially on our shorter lead time businesses, for example fuses, we are seeing, heading into the quarter and not having orders, and then all of a sudden, the order comes in, we ship it out within the quarter. So that is nice to see because that indicates a little bit more healthiness in the channel, and overall the market. So, it is an important indicator, I would say, that the market is functioning a little bit more than it's supposed to function or more in the right way it's supposed to be functioning.

但今天，特別是在我們的較短交貨期業務上，例如保險絲，我們發現，進入本季度時沒有訂單，然後突然間，訂單來了，我們在本季度內將其發貨。看到這一點令人欣喜，因為這表明通路和整個市場更加健康。所以，我想說，這是一個重要的指標，顯示市場運作得比它應有的程度要好一些，或者說，市場運作得比它應有的程度要好一些。

Yeah, thanks, and I imagine it's a little tough to bifurcate, but sense of like actual and market improvement in networking. I know that kind of stage one of lack of destock and back to normal that you just described is powerful considering the depth and duration of the channel adjustments. But are you able to tease out, get the end market is pivoting there?

是的，謝謝，我想分叉有點困難，但感覺就像網路的實際和市場改進一樣。我知道，考慮到通路調整的深度和持續時間，您剛才描述的缺乏去庫存和恢復正常的第一階段是強有力的。但是您能否弄清楚，終端市場正在發生哪些轉變？

Yeah, I think one of the challenges when we look at the distribution channels specifically as a reminder for folks on the call, we do get POS data, right? So, we're effectively seeing what our customers' customers are buying off the shelf.

是的，我認為當我們查看分銷管道時面臨的挑戰之一就是提醒通話中的人們，我們確實獲得了 POS 數據，對嗎？因此，我們可以有效地了解客戶的客戶購買的現成產品。

So, when we look at what was coming off the shelf versus what we're selling to distribution, there was a mismatch, right? So, I would say we, when we look at our percentage decline in our businesses, it was more severe than what we would see, for example, the distribution levels. So, when you achieve a little bit of normalcy, that's a little bit of healthiness.

因此，當我們比較現成的產品和我們賣給分銷商的產品時，會發現有不匹配的情況，對嗎？因此，我想說，當我們查看我們業務的百分比下降時，它比我們所看到的更為嚴重，例如分銷水平。所以，當你達到一點正常狀態時，那就是一點點健康。

So, I think your question, Chris, is the numbers even in the last couple of years were not as bad as ours, if you will, because there was ordering patterns and now it seems like we're closing the delta. We also see the inventory levels and those have come down to very low levels. So now you get to more of that parity where orders go out the door and you're more likely to get an order is the way I can think about it.

所以，克里斯，我認為你的問題是，即使過去幾年的數字也不像我們的那麼糟糕，如果你願意的話，因為存在訂購模式，現在看來我們正在縮小差距。我們也看到庫存水準已經降至非常低的水準。所以現在您可以獲得更多的平等，訂單出去了，您更有可能獲得訂單，這就是我能想到的。

Makes sense and just want to ask about Econ you know you had your second full quarter here. I know you're out in quarter talking about it. It sounds very good, but, yeah, just curious progress on the integration on the commercial sides. I don't think there's a whole lot of operating integration intent there, but, perhaps you could clarify that.

有道理，我只是想問一下經濟方面的問題，你知道你在這裡度過了第二個完整季度。我知道你正在外面談論這件事。這聽起來很不錯，但是，是的，我只是好奇商業方面的整合進展如何。我認為那裡沒有太多的營運整合意圖，但是，也許你可以澄清這一點。

Yeah, so I think it's going, kind of as we anticipate it, obviously it's a great team, doing great products in a great end market, and given where they play in the process supplying the way they go to market with it, it's been, it's been as advertised. And I think the broader comment expand on your questionnaire, Chris, as we think of the defense globally, right? We're seeing it in our connectivity business and we're seeing that expand. So, where we are in those markets today, which is a good place to be, I think the team is excited. We're I'd say collaborating better.

是的，所以我認為它會像我們預期的那樣，顯然這是一支偉大的團隊，在一個偉大的終端市場上生產偉大的產品，並且考慮到他們在供應過程中所扮演的角色以及他們進入市場的方式，它已經，它已經像廣告宣傳的那樣。克里斯，我認為更廣泛的評論會擴展您的問卷，因為我們從全球角度考慮防禦，對嗎？我們在我們的連接業務中看到了這一點，並且我們看到它正在擴展。因此，我們目前在這些市場中所處的位置很好，我認為團隊對此感到興奮。我想說我們的合作比較好。

I think you know we have some way to go as this is a long track design business and regulatory customers are very busy with some replenishment sometimes, but we like the direction that we can go, but we can always do better, right? So I think we're situated very well to really capitalize on that acquisition and especially in that market. So, we're, we remain excited and bullish on it.

我想你知道我們還有一段路要走，因為這是一項長期的設計業務，監管客戶有時會非常忙於補貨，但我們喜歡我們可以走的方向，但我們總是可以做得更好，對吧？因此我認為我們處於非常有利的位置，可以真正利用這次收購，特別是在那個市場。因此，我們對此仍然感到興奮和樂觀。

Great, thanks for the call.

太好了，謝謝您的來電。

Oh nice, Chris.

哦，太好了，克里斯。

James Ricchiuti, Needham & Company LLC.

詹姆斯‧里基烏蒂 (James Ricchiuti)，尼達姆公司有限責任公司。

Hi, thanks. Good morning. So, I just wanted to ask about what was a modest sequential decline in the power solutions gross margins. Is that mainly a function of the sequential growth in the in the legacy power business, the increase in DSD, and it looks like Lynn, if I heard you correctly, it looks like the intercom contribution was roughly flat with Q1.

你好，謝謝。早安.所以，我只是想問一下電源解決方案毛利率的環比小幅下降情況。這主要是由於傳統電力業務的連續成長和 DSD 的成長，如果我沒聽錯的話，Lynn，對講機的貢獻似乎與第一季基本持平。

The Intercon contribution was roughly flat with Q1. Yes, so Jim, are you asking about power margins from Q2 last year to Q2 this year. or Q1 to Q2?

Intercon 的貢獻與第一季基本持平。是的，吉姆，你問的是去年第二季到今年第二季的功率裕度，還是第一季到第二季的功率裕度？

Q1 to Q2. And so, I'm wondering if it's just a function of the legacy power business picking up sequentially. Yeah, so it's.

Q1 到 Q2。因此，我想知道這是否只是傳統電力業務逐步回升的功能。是啊，確實如此。

Right, so the growth was related not to and consequentially, they were flat quarter over quarter from Q1, but it was the legacy power business which historically, is a lower margin, product groups and they recently acquired Under/Comm business.

是的，所以成長與此無關，因此，它們與第一季相比季度環比持平，但這是傳統電力業務，從歷史上看，其利潤率較低，產品組最近收購了 Under/Comm 業務。

Got it. Thanks. You talked about some wins in A&D and it may be still pretty early in where we are with this, but are you seeing, is there anything you can point to in terms of sales synergies as it relates to Econ, or are these just wins separate from what your ultimate plans are to drive more sales synergies with this business?

知道了。謝謝。您談到了 A&D 領域的一些成功，現在可能還處於初期階段，但您是否看到了，在與 Econ 相關的銷售協同效應方面，您能指出什麼嗎？或者這些成功是否與您最終的計劃無關，即透過該業務推動更多的銷售綜效？

Yeah, so if we think of, our connector team and the Intercon team, they're both kind of winning on their own, I'd say merit today. The joint wins, and we've seen some opportunities come across the wall here and there, but as a reminder, Jim, we've said we don't really expect any revenue synergy in 2025 and 2026 is probably our best bet probably in the back half of 2060, I think it is more realistic. Because these are long cycle design businesses, it's a risk averse customer base and then also as we think of just ability to manufacture, there's a fair amount of backlog on the intercom site that that they need to get to.

是的，所以如果我們想想，我們的連接器團隊和 Intercon 團隊，他們都在憑藉自己的力量取得勝利，我想說今天他們功績卓著。聯合獲勝，我們已經看到一些機會在這裡和那裡出現，但提醒一下，吉姆，我們已經說過，我們並不真正期望在 2025 年和 2026 年實現任何收入協同效應可能是我們最好的選擇，可能是在 2060 年下半年，我認為這更現實。因為這些都是長週期設計業務，所以客戶群是規避風險的，而且當我們考慮製造能力時，他們需要到達的對講機站點有相當多的積壓訂單。

So, it is a little bit of a belly fold but really, it's driven by the customers long design cycles, and also, we talked about kind of figuring out, well, what customers are we talking about, right? So, for the Europeans, we need a little bit of a different playbook where we really kind of leverage some of our European manufacturing footprint to service those guys. So, I would say it's, we, the market is just a long cycle design business, but the good news is here is the teams on their own prerogative are seeing some nice wins.

所以，這有點像腹部折疊，但實際上，它是由客戶的長期設計週期驅動的，而且，我們還討論瞭如何弄清楚，好吧，我們在談論哪些客戶，對嗎？因此，對於歐洲人來說，我們需要採取一些不同的策略，真正利用我們在歐洲的部分製造業足跡來為這些人提供服務。所以，我想說，我們的市場只是一個長週期的設計業務，但好消息是，團隊憑藉自己的特權取得了一些不錯的勝利。

Good. Last question from me, just on commercial air, again, if I heard you correctly, Lynn, it sounds like you had some nice growth in that part of the business. What are you what are you seeing there and you know what kind of expectations do you have as you look out beyond the quarter in that part of the business?

好的。我的最後一個問題，是關於商業廣播的，如果我沒聽錯的話，Lynn，聽起來你的業務在那部分取得了不錯的增長。您在那裡看到了什麼？您知道，對於該業務部分在本季之後的發展，您有什麼樣的期望嗎？

Yeah, so Jim, on commercial air, yeah, if you recall in Q1, it was just under $13 million in Q2 it was $20.5 million. So nice sequential growth there, I think the outlook for commercial air tended. Still robust. We do tend to see a bit of, patchy ordering patterns, if you will, in that business. So will it be the exact same level as Q2, unclear at this time, but we do expect it to be robust.

是的，吉姆，就商業廣播而言，是的，如果你還記得的話，第一季的收入略低於 1300 萬美元，而第二季度的收入為 2050 萬美元。因此，連續成長表現良好，我認為商用航空的前景趨於樂觀。依然強勁。如果你願意的話，我們確實傾向於在該業務中看到一些不完整的訂購模式。那麼它是否會與第二季度處於完全相同的水平，目前尚不清楚，但我們確實預計它會很強勁。

Thanks a lot.

多謝。

Greg Palm, Craig-Hallum Capital.

格雷格·帕姆（Greg Palm），Craig-Hallum Capital。

Yeah, good morning. Thanks, and congrats on the results. Going back to the last call that $8 million to $10 million of, so-called paused revenue coming out of China, how much of that was recognized specifically in the quarter and the assumption that, the entirety gets, recognized over the course of Q3 or whatever it wasn't in Q2.

是的，早安。謝謝，並祝賀你所取得的成果。回到上次的通話，即來自中國的 800 萬至 1000 萬美元的所謂暫停收入，其中有多少是在本季度具體確認的，並且假設全部收入將在第三季度或第二季度確認。

Yeah, so we took a look at that, Greg, and it was about 2/3 of it ultimately got shifts in the second quarter, and the balance is expected to go out in the third quarter.

是的，格雷格，我們看了看，大約 2/3 的量最終在第二季度得到轉移，剩餘的量預計將在第三季度轉移。

Okay, and I think you made a comment at the end of your prepared you said expect sequential growth for the remainder of the year. So, are you saying you're expecting sequential growth in the December quarter in Q4 as well over Q3? I just wanted to clarify that.

好的，我認為您在準備結束時發表了評論，您說預計今年剩餘時間將實現連續增長。那麼，您是說，您預計第四季 12 月的銷售額將比第三季實現連續成長嗎？我只是想澄清這一點。

Yeah, that's a good question. I think when we just look at at the second half, we expect more of us. I think when, that's a good point there, Greg, as a reminder for everybody on the call, usually Q1 is our weakest quarter of the year.

是的，這是個好問題。我認為，當我們展望下半場時，我們會對自己有更高的期望。我認為這是一個很好的觀點，格雷格，提醒電話會議中的每個人，通常第一季是我們一年中最疲軟的季度。

And our strongest is usually Q2 and or Q3, but usually they're kind of the strongest quarter sometimes they move around a little bit. And then Q4 is somewhere in the middle, where there's the golden week out in Asia and you go into the holiday seasons, and kind of and so on.

我們最強勁的通常是第二季度或第三季度，但通常它們是最強勁的季度，有時它們會略有波動。第四季處於中間位置，亞洲正處於黃金周，隨後進入假期季節等等。

So we're not ready to sign up for sequential Q4 at this point. Obviously, we have to see the orders coming into Q3 to get a better read on it. But we do expect obviously overall by definition, right, given the strong number in Q3 that we guided to and Q4 Q1, we expect each, the second half to be better than the first half overall.

因此，我們目前還沒有準備好簽約連續的第四季。顯然，我們必須觀察第三季的訂單情況才能更好地了解情況。但我們確實預計，從總體上看，鑑於我們預期的第三季和第一季的強勁數據，我們預計下半年總體上會比上半年更好。

Yeah, okay, that makes sense. And I guess just sort of broadly speaking in terms of what you're seeing currently, I mean, how do you know that some of this is not, pull-ins ahead of tariffs, like what's your visibility levels to suggest that none of this is sort of pulling orders to get ahead of something that's maybe coming.

是的，好的，這很有道理。我想就您目前看到的情況而言，廣義上講，您怎麼知道其中一些不是在關稅之前進行的拉貨，您的能見度如何，可以表明這些都不是為搶在即將發生的事情之前而進行的拉貨。

I mean, listen, if we're to look at one singular order somewhere that chirp, I mean we could see that, but it's not a pervasive thing that we've seen. The other thing I would keep in mind, right, as we said this we got really good bookings in the quarter. So just by definition you're going to be beyond these deadlines that got placed and as we looked at July, we also continue to see robustness in the bookings. Which would be beyond the, let's call it, moving deadline of tariffs, whatever it is now. So -- and also when we look at where it's coming from really all parts of the business.

我的意思是，聽著，如果我們要觀察某個地方發出吱吱聲的單一順序，我的意思是我們可以看到它，但這並不是我們所看到的普遍現象。我要記住的另一件事是，正如我們所說的那樣，我們在本季度獲得了非常好的預訂量。因此，根據定義，您將超越這些已設定的最後期限，並且當我們回顧 7 月時，我們也繼續看到預訂量的強勁增長。這將超出我們所說的關稅變動期限，不管現在是多少。所以 — — 而且當我們查看它實際上來自業務的各個部分時。

And also, if you remember our revenue that we talked about in on the last call, roughly 10% of that from the previous year was going to China, but we're seeing it across the business. The other thing I would say on the tariff commentary is when we look at the tariff levels today and kind of where they're shaking out at, I would say the market has digested that, so it's no longer the boogeyman in the room like when it was in the 100s in terms of tariffs. So, I think the market has recognized that. I think they're okay with these lower levels of tariffs, and we're seeing it come from different parts of our business. So it's not just. People that are usually going to be exposed to terrorism and that's where the orders are coming from. It's much more pervasive than that.

此外，如果您還記得我們在上次電話會議上談到的收入，那麼去年大約 10% 的收入來自中國，但我們在整個業務中都看到了這一點。關於關稅評論，我想說的另一件事是，當我們看看今天的關稅水平以及它們目前的震盪情況時，我想說市場已經消化了這一點，所以它不再像關稅達到 100 多美元時那樣令人擔憂。所以，我認為市場已經認識到了這一點。我認為他們對這些較低水平的關稅感到滿意，而且我們看到它來自我們業務的不同部分。所以不公平。這些人通常會遭受恐怖主義的威脅，而這些命令就是從那裡發出來的。它比這更普遍。

And just to add to that, Greg, we did survey, the global customer service team who would be kind of have their finger on the pulse there to see if there were pull-ins, right, in order for someone to actually have something pulled in from its regular scheduled ship date, they would need to put in that request that would go to our customer service department. So, and we did not. We did not have any, material input from that survey as well.

補充一點，格雷格，我們確實進行了調查，全球客戶服務團隊會隨時關注情況，看看是否有延遲發貨的情況，對吧，為了讓某些商品在正常發貨日期後真正延遲發貨，他們需要向我們的客戶服務部門提出請求。所以，我們沒有。我們也沒有從該調查中獲得任何實質的投入。

Okay, yeah, I appreciate that color. And last one, for me, A&D, which is become the biggest, most important and market, you covered commercial aerospace well, but in terms of defense and maybe this includes Intercon or outside Intercon, just can you remind us like what either programs and markets applications, like what do you have? I know it's broad-based, but is there anything that you have maybe outsized exposure to in the defense side specifically?

好的，是的，我很欣賞那個顏色。最後，對我來說，A&D 已經成為最大、最重要的市場，您很好地涵蓋了商業航空航天，但在國防方面，也許這包括 Intercon 或 Intercon 之外，您能否提醒我們，您有哪些專案和市場應用？我知道它的基礎很廣泛，但是你在防守方面是否有特別大的風險敞口？

I mean, I would say I cave on the answer by saying, there's a handful of crimes, for example, in the US and in Israel, right? So is there a technical customer concentration? Sure, but really what matters is the program concentration, right? So when we look at the program level, at a broader, let's call it belt use A&D, I don't think there's kind of a singular. Kind of high level of concentration. So it's a pretty diverse program, business. So it's not like a commercial air where there is, some concentration, right? So it's a pretty diverse business.

我的意思是，我會說我接受這個答案，例如在美國和以色列就存在著少數犯罪行為，對嗎？那麼是否存在技術客戶集中度？當然，但真正重要的是程式的集中度，對嗎？因此，當我們從更廣泛的角度來看待程式層級時，我們稱之為帶用 A&D，我不認為它是一種單數。有點高度集中。所以這是一個相當多樣化的項目，業務。所以它不像商業氛圍那樣具有一定的集中性，對嗎？所以這是一項相當多元化的業務。

Got it. It, but you have exposure to missile defense. I guess how, where does that sort of stack up in terms of, programs are

知道了。是的，但你已經暴露在導彈防禦之下。我想，就程序而言，這種情況如何？

Missile defense in total, I would say not sure we added that all up, but I would say we're generally heavier lever towards munitions, and generally I would say things that fly, we obviously do other things as well, but just general munitions and planes, it's kind of where we're an average leverage.

就導彈防禦總體而言，我想說我們不確定我們是否把所有這些都加起來了，但我想說我們一般對彈藥的槓桿更大，一般來說我會說飛行的東西，我們顯然也做其他的事情，但只是一般的彈藥和飛機，這是我們平均槓桿的地方。

Got it. All right, appreciate all the color. Thanks.

知道了。好的，欣賞所有的色彩。謝謝。

Luke Huglin, Baird.

盧克·哈格林，貝爾德。

Hi, good morning. Thanks for taking the questions. Lynn, maybe hoping to start with the third quarter guidance to beat the high end this quarter, obviously at the midpoint you're implying a few million of sequential improvement into 3Q, but you were at the high end, it'd be another seven points of growth into the third quarter just. Where should we think that upside leverages in the model? Is it networking, or should we think it's more broad-based, I guess I gearing to your comments about the orders being robust overall, and I don't know if there's any book to build context you could give us also.

嗨，早安。感謝您回答這些問題。林恩，也許希望從第三季度的指引開始超越本季度的高端，顯然在中間點你暗示第三季度將有幾百萬的連續改善，但如果你處於高端，那麼第三季度將再增長 7 個點。我們該如何看待模型中的上行槓桿？它是網絡嗎，或者我們應該認為它具有更廣泛的基礎，我想我正在針對您關於訂單總體強勁的評論進行調整，我不知道您是否也可以給我們任何書籍來構建背景。

Thank you.

謝謝。

Hi Luke Huglin. So, as we look to Q3, I mean, it's really continued strength in Aerospace defense. And then the rebound in networking and the distribution channels. So, if we're looking at Q2 to Q3 and potential growth drivers sequentially, it would really be more in the areas of networking and distribution, coupled with strong defense.

你好，Luke Huglin。因此，當我們展望第三季時，我的意思是，航空航天防禦領域確實繼續保持強勁勢頭。然後是網路和分銷管道的反彈。因此，如果我們連續觀察第二季到第三季以及潛在的成長動力，那麼它實際上將更多地出現在網路和分銷領域，再加上強大的防禦能力。

And I think the range is to take into account the potential for more inter quarter turns. So, they're still not at the level that they were at historically, but we did definitely see an improvement this quarter from where they had been. So, depending on the level of inter quarter turns, turning back on that kind of is the broader range on the higher side.

我認為這個範圍要考慮到更多季度間轉彎的可能性。因此，他們仍未達到歷史水平，但我們確實看到本季的水平有所改善。因此，根據四分之一轉彎的水平，這種轉彎的範圍在較高側更為廣泛。

Okay, that, that's helpful. Thank you. Maybe taking a step back, just bigger picture, I'm thinking of the efforts you've taken in terms of salesforce so efforts, be it leadership, be it the in some structure, and just the timing of starting to see some of that bear fruit relative to your longer design cycles and the sales cycle, maybe you can just give us a snapshot of some of the progress markers that you're seeing as of mid-year here that maybe aren't obvious in the business from the upset looking in, but maybe contribute later this year into 2026.

好的，這很有幫助。謝謝。也許退一步來看，從更大的角度來看，我正在考慮您在銷售人員方面所做的努力，無論是領導力還是某種結構，以及相對於您更長的設計週期和銷售週期而言，開始看到其中一些成果的時間，也許您可以將您在年中看到的一些進展標記，這些標記可能從業務的角度來看並不明顯，但可能會在今年晚些時候做出貢獻。

Yeah, I think given the diversity of our business geographically in markets and skews, I think it's hard to say this thing did exactly this thing, and then we have had so many shots on goal that we're seeing the outcomes of that.

是的，我認為考慮到我們的業務在市場和地理上的多樣性，我認為很難說這件事確實起到了作用，然後我們已經進行瞭如此多的嘗試，我們看到了其結果。

So for example, one of the comments you mentioned was around the commission structure. So we initially put that in place back in 2024, and then we modified it and enhanced it heading into 2025. So the results of I think maybe some of the winds that we're seeing is probably a little bit of modification on the incentive structure really starting out last year.

例如，您提到的其中一條評論是關於佣金結構的。因此，我們最初在 2024 年就實施了該計劃，然後在 2025 年對其進行了修改和增強。因此，我認為我們所看到的一些風向的結果可能是對去年開始的激勵結構進行了一些修改。

As we also think around just setting targets and pushing out surprise and getting after things a little more efficiently, I think that mindset and then that we play to win that attitude we're seeing that come through, but also remembering that for the sales folks to win, you have to be able to produce things in a cost efficient manner.

當我們考慮設定目標、推出驚喜並更有效地完成任務時，我認為這種心態以及我們為贏得勝利而努力的態度正在顯現，但也要記住，為了讓銷售人員獲勝，你必須能夠以具有成本效益的方式生產產品。

So when we look at the facility footprints, we started that work maybe two to three years ago at this point where we've been investing a lot in CapEx and automation the last two years in 2023 and in 2024 to automate our factories and lean into more LeanTech concepts, we're seeing the benefits of that. So if you have a sales team that's heading and shooting in the right direction, we have a manufacturing team that's doing great in terms of manufacturing effectively, but also procurement is very important, right? We've got to make sure that we're procuring things.

因此，當我們查看設施佔地面積時，我們大概在兩到三年前就開始了這項工作，過去兩年我們在資本支出和自動化方面投入了大量資金，即 2023 年和 2024 年，以實現工廠自動化並傾向於更多的 LeanTech 概念，我們看到了這樣做的好處。因此，如果您擁有一支朝著正確方向前進的銷售團隊，那麼我們就擁有一支在高效製造方面表現出色的製造團隊，但採購也非常重要，對嗎？我們必須確保我們正在採購東西。

At a good price point, especially places in our in our like legacy power and magnetics group, right? We want to make sure we're getting things at a decent price point so we can make our margins. So that's also good as we think, quite frankly, on the executive team compensation reign that 2023 was the first year where we really set out clear revenue and even dot targets for the team to hit, and now we're in our year three heading into 2025.

價格合理，特別是在我們傳統的電力和磁性集團中，對嗎？我們希望確保以合理的價格獲得產品，這樣我們才能獲得利潤。因此，坦白說，我們認為，在高階主管團隊薪酬制度方面，2023 年是我們真正為團隊制定明確的收入甚至點目標的第一年，現在我們已經進入 2025 年的第三年。

So as we look at the ranges of what drove this, I think it's amalgamation of these things. So I would say it's a robustness, it is a team effort and orchestra whether it be from customer service, to sales, to R&D, to manufacturing, to procurement. Everything matters, and I think that's kind of the mindset we're leading with.

因此，當我們觀察導致這現象的因素時，我認為這是這些因素的融合。所以我想說這是一種穩健性，是一種團隊的努力和協調，無論是從客戶服務、銷售、研發、製造或採購。一切都很重要，我認為這就是我們所秉持的思維方式。

So I'm generally not a fan of, one trick ponies because if that goes the other way, then you may get burned. I think what I like about it is the swelling of team effort to win. We're not perfect and we got room to grow and get better, but we like what we're seeing and obviously I think some of the outputs of what we're seeing today is that work that we've seen in the last few years.

所以我通常不喜歡只有一招的小馬，因為如果反過來，你可能會被燒傷。我認為我喜歡它的原因是團隊為贏得勝利而不斷努力。我們並不完美，我們還有成長和進步的空間，但我們喜歡我們所看到的，顯然我認為我們今天看到的一些成果是我們過去幾年所看到的工作。

Appreciate the color. I'll leave it there. Thank you.

欣賞色彩。我就把它留在那裡。謝謝。

Thank you.

謝謝。

Theodore O'Neill, Litchfield Health Research.

西奧多·奧尼爾，利奇菲爾德健康研究中心。

Yeah, great. Congratulations on the good quarter. Lynn, you sort of touched on this, but connectivity solutions was up fairly significantly, sequentially Q1 to Q2. Were the trends any different there than what you're seeing year over year?

是的，很棒。恭喜本季取得良好業績。林恩，您提到了這一點，但連接解決方案的增長相當顯著，從第一季到第二季。那裡的趨勢與您每年看到的趨勢有什麼不同嗎？

So from Q1 To Q2 versus sequentially.

因此從 Q1 到 Q2 是依序進行的。

Versus sequentially versus year over year.

與上一季相比，與上一年度相比。

Right, so we did see, so if we're looking year over year, there was an increase in commercial air, not as pronounced, versus the sequential increase from Q1. So commercial air in Q2 last year was just over $15 million, versus just under $13 million in Q1 '25 and then the $20.5 million in Q2 '25.

是的，我們確實看到了，如果我們逐年觀察，商業航空有所增加，但與第一季的連續成長相比，增幅並不那麼明顯。因此，去年第二季的商業航空收入略高於 1,500 萬美元，而 2025 年第一季略低於 1,300 萬美元，2025 年第二季為 2,050 萬美元。

I guess looking year over year, we did see a drop in their distribution sales. So, while we saw distribution waking up in power and magnetics during the quarter, we did see a slight setback in connectivity distribution. So that was also a driver from Q2 last Year to Q2 this year.

我想，從年比來看，我們確實看到他們的分銷銷售額有所下降。因此，雖然我們看到本季度電力和磁性領域的分佈有所復甦，但我們確實看到連接性分佈略有倒退。因此，這也是從去年第二季到今年第二季的驅動因素。

Sure. And on depreciation, it's almost doubled year over year. What's happening there.

當然。就折舊而言，其折舊額幾乎比去年同期翻了一番。那裡發生了什麼事。

So, with the acquisition of Intercon in November, we brought on their, all of their PT&E and we have the step ups, so depreciation and the amortization went up quite a bit, year over year just because of the new tangible and intangible assets that we brought onto the books.

因此，隨著 11 月對 Intercon 的收購，我們引入了他們所有的 PT&E，並且我們進行了升級，因此折舊和攤銷同比大幅增加，僅僅是因為我們記入帳目的新的有形和無形資產。

Okay, thanks very much.

好的，非常感謝。

Thank you. Hendi Susanto, Gabelli Funds.

謝謝。Hendi Susanto，Gabelli Funds 基金。

Good morning, Farouq and Lynn. Congratulations on strong results.

早上好，Farouq 和 Lynn。恭喜您取得優異的成績。

Thank you.

謝謝。

Farouq, my first question is about the market recovery and inventory rebuild. Some sales will go toward inventory rebuild. On the other hand, like short lead times may not necessitate inventory rebuild to be done like in the past, and there's also some.

法魯克，我的第一個問題是關於市場復甦和庫存重建。部分銷售額將用於庫存重建。另一方面，較短的交貨時間可能不需要像過去那樣進行庫存重建，而且也存在一些情況。

Uncertainty on the tariffs that may drive customers to be more cautious when it comes to building inventory. So, let's say like in 2025 you will see some benefits on inventory rebuild, but at the same time, like how should we manage our expectation and, what are some guideposts so that we are not overly optimistic because inventive rebuild may take some time.

關稅的不確定性可能會促使客戶在建立庫存時更加謹慎。因此，假設在 2025 年，您將看到庫存重建的一些好處，但同時，我們應該如何管理我們的預期，以及有哪些指導方針可以讓我們不要過於樂觀，因為創造性的重建可能需要一些時間。

Yeah, I would say, that's your question. I think maybe a couple of things is our industry and Bellus obviously has been in this, trough for a very long time, let's call it maybe the industry has been in there roughly two years, and when we look at that two-year context compared to history, that is, a very long time.

是的，我想說，這就是你的問題。我認為也許有幾件事與我們的行業有關，而 Bellus 顯然已經處於低谷很長一段時間了，我們姑且這麼說吧，這個行業可能已經處於低谷大約兩年了，當我們將這兩年與歷史進行比較時，就會發現這是很長的時間了。

So, now we're coming out of a two-year prolonged trough cycle. I think we do see customers being overall more cautious and hesitant, and quite frankly, we potentially thought growth would have come maybe end of last year or where we would have seen those really low inventory levels. So, we are operating from a customer universe where people are just more hesitant given tariffs and geopolitical concerns and the world we come in.

所以，現在我們正走出長達兩年的低谷週期。我認為我們確實看到客戶總體上更加謹慎和猶豫，坦白說，我們可能認為成長可能會在去年年底到來，或者我們會看到庫存水準非常低。因此，我們是在一個客戶世界中運作的，在這個世界中，人們由於關稅和地緣政治問題以及我們所處的世界而更加猶豫。

But at the same time, in a normal cycle, people are not necessarily building inventory, right? They are trying to order things to make products and get out the door. And sure, you build up some inventory along the way, but when inventory builds up, usually the system is not working appropriately. So now we're heading into hopefully the other side of the cycle where the system is working a little more appropriately.

但同時，在正常週期中，人們不一定會增加庫存，對嗎？他們正在嘗試訂購物品來製造產品並運出門。當然，您會在過程中累積一些庫存，但當庫存累積起來時，系統通常無法正常運作。因此，現在我們正朝著充滿希望的周期的另一端前進，屆時系統將運作得更正常。

Okay, and then my next question is, the fact that you choose special Chinese supplier situation, that has started like couple quarters ago, can we revisit that whether it is now fully behind?

好的，我的下一個問題是，您選擇特殊的中國供應商的情況，這種情況在幾個季度前就開始了，我們能否重新審視一下現在是否已經完全落後了？

I mean, it's fully, I caution with that because the generally the Chinese suppliers we were selling, some consumer in markets and distribution. So, with the weakness in that channel, it was a little bit, obviously we lost the revenue and that hurt.

我的意思是，我對此持謹慎態度，因為我們銷售的一般是中國供應商，一些市場和分銷商是消費者。因此，由於該管道的弱點，我們顯然損失了一點收入，這很痛苦。

So, step one to rebuild that lost revenue is to find alternative suppliers and the team has done a really good job at finding alternative suppliers. So I think we've replaced from a concentration perspective, a lot of those skews. Now the question becomes is can we put those in the market and get them designed in and therefore get the orders going. I would say the team's done a great job of rebuilding supplier base.

因此，重建損失收入的第一步是尋找替代供應商，而團隊在尋找替代供應商方面做得非常出色。因此我認為從集中度的角度來看我們已經取代了許多偏差。現在的問題是，我們能否將它們投放到市場並進行設計，從而獲得訂單。我想說團隊在重建供應商基礎方面做得非常出色。

I would say that we're definitely more robust on that business as we look out to the year end here and we think we'll, we might recover some of that revenue. So we'd like where we're going and I would say they're a little bit ahead of schedule in terms of what we thought they'd rebuild that business into.

我想說的是，展望年底，我們的業務肯定會更加強勁，我們認為我們可能會恢復部分收入。因此，我們對我們的發展方向感到滿意，而且我想說，就我們預期的重建業務而言，他們比計劃提前了一點。

And hey, just to add to that Chinese supplier, the revenue related to that, dropped off in May of last year. So, if you're looking at the year over year. Headwinds, that is behind us for the costs will be apple to apple starting to be great.

嘿，補充一下，中國供應商的相關收入在去年 5 月下降了。因此，如果你逐年觀察的話。逆風已經過去，因為成本將開始變得巨大。

And then, I mean, would you talk about the pricing plans this year, whether there's some pricing decline embedded in the contract and what is the usual timing of pricing trend or whether or not you are able to sustain your pricing.

然後，我的意思是，您能否談談今年的定價計劃，合約中是否存在一些價格下降，以及定價趨勢的通常時間是什麼，或者您是否能夠維持您的定價。

Yeah, I think that's a very big question, Hindi, and I think I want to caution we're not, kind of like more of a semi cycle where, there's so much inventory and prices down. Our products are designed in and it really depends what in market we're talking about. Aerospace defense, we tend to think of it as a price flat price up the environment, right?

是的，我認為這是一個非常大的問題，印地語，我想提醒一下，我們不像半週期那樣，庫存太多，價格下降。我們的產品設計確實取決於我們所談論的市場。航空航太國防，我們傾向於認為它是一個價格平價上漲的環境，對嗎？

Some of the other areas sure be a price flat price down, but overall, I would say we haven't really seen the pricing pressures, but generally pricing pressures come in better markets where you will have also new products launching hopefully with higher margins.

其他一些領域的價格肯定會持平下降，但總體而言，我想說我們還沒有真正看到定價壓力，但一般來說，定價壓力來自於更好的市場，在這些市場中你也會推出新產品，希望它們能帶來更高的利潤率。

So we tend to think about pricing we're in maintenance mode versus, we're heading to growth or and everything gets priced down like maybe doing a more of a semi side of things. So, for us, obviously we're always mindful of it, we'll have customers ask for it, sure, but we're also launching new products at a higher margins, but we've got some good defense business that is a usual price flat price up environment. So, it's a big question for us given the diversity of our skews and pricing powers.

因此，我們傾向於考慮處於維護模式的定價，而不是正走向成長，或是所有東西的價格都會下降，例如可能做一些半成品的事情。因此，對我們來說，顯然我們始終牢記這一點，當然，我們會有客戶要求這一點，但我們也會以更高的利潤率推出新產品，但我們有一些良好的國防業務，這是一個通常價格持平、價格上漲的環境。因此，考慮到我們的傾向性和定價權的多樣性，這對我們來說是一個大問題。

Thank you, Farouq. Thank you, Lynn.

謝謝你，法魯克。謝謝你，林恩。

Thank you. At this time, I'll turn the call back to Farouq for closing remarks.

謝謝。現在，我將把電話轉回給法魯克，請他作最後發言。

Thank you for joining our call here this morning. We are excited about the results that came in here and look forward to connecting with you again as we go through the second half of the year. I appreciate everyone's time and have a good day.

感謝您今天上午參加我們的電話會議。我們對所取得的成果感到非常興奮，並期待在今年下半年再次與您聯繫。感謝大家的時間並祝大家有愉快的一天。

This will conclude today's conference. May disconnect your lines at this time and thank you for your participation. Have a wonderful day.

今天的會議到此結束。此時可以斷開您的線路並感謝您的參與。祝您有美好的一天。