Celestica Inc (CLS) 2024 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Celestica Q2 2024 Earnings Call. (Operator Instructions) This call is being recorded on Thursday, July 25, 2024.

早安，女士們、先生們，歡迎參加天弘 2024 年第二季財報電話會議。 （操作員說明）此通話錄音時間為 2024 年 7 月 25 日星期四。

I would now like to turn the conference over to Craig Oberg, Vice President of Investor Relations and Corporate Development. Please go ahead.

我現在想將會議交給投資者關係和企業發展副總裁克雷格·奧伯格 (Craig Oberg)。請繼續。

Good morning, and thank you for joining us on Celestica’s second quarter 2024 earnings conference call. On the call today are Rob Mionis, President and Chief Executive Officer, and Mandeep Chawla, Chief Financial Officer.

早安，感謝您參加 Celestica 的 2024 年第二季財報電話會議。今天參加電話會議的有總裁兼執行長 Rob Mionis 和財務長 Mandeep Chawla。

Please note that during the course of this call, we will make statements related to the future performance of Celestica that contain forward-looking information. While these forward-looking statements represent our current judgment, actual results could differ materially from a conclusion, forecast or projection in the forward-looking statements made today. Certain material factors and assumptions are applied in drawing any such statement.

請注意，在本次電話會議期間，我們將發表與天弘未來業績相關的包含前瞻性資訊的聲明。雖然這些前瞻性陳述代表了我們目前的判斷，但實際結果可能與今天前瞻性陳述中的結論、預測或預測有重大差異。在繪製任何此類聲明時會應用某些重要因素和假設。

For identification and discussion of such factors and assumptions, please refer to our public filings available at sedarplus.ca and sec.gov. We undertake no obligation to update these forward-looking statements unless expressly required to do so by law.

有關此類因素和假設的識別和討論，請參閱我們在 sedarplus.ca 和 sec.gov 上提供的公開文件。除非法律明確要求，否則我們不承擔更新這些前瞻性聲明的義務。

In addition, during this call, we will refer to various non-IFRS financial measures, including non-IFRS operating margin, adjusted gross margin, adjusted return on invested capital or adjusted ROIC, adjusted free cash flow, gross debt to non-IFRS trailing 12-month adjusted EBITDA leverage ratio, adjusted earnings per share or adjusted EPS, adjusted SG&A expense, adjusted effective tax rate and non-IFRS operating earnings.

此外，在本次電話會議中，我們將參考各種非國際財務報告準則財務指標，包括非國際財務報告準則營業利益率、調整後毛利率、調整後投資資本回報率或調整後投資回報率、調整後自由現金流、非國際財務報告準則尾隨債務總額12 個月調整後 EBITDA 槓桿率、調整後每股收益或調整後 EPS、調整後 SG&A 費用、調整後有效稅率和非 IFRS 營運收益。

Additional information about material factors that could cause actual results to differ materially from a conclusion, forecast or projection in the forward-looking information as well as risk factors that may project future performance results of Celestica and reconciliations of such non-IFRS financial measures to their most directly comparable IFRS measures are contained in our public filings. Unless otherwise specified, all references to dollars on this call are to US dollars and per share information is based on diluted shares outstanding.

有關可能導致實際結果與前瞻性信息中的結論、預測或預計存在重大差異的重大因素的附加信息，以及可能預測天弘未來業績結果的風險因素以及此類非國際財務報告準則財務指標與其財務指標的調節表最直接可比較的國際財務報告準則衡量標準包含在我們的公開文件中。除非另有說明，本次電話會議中所有提及的美元均指美元，每股資訊基於稀釋後的已發行股票。

Let me now turn the call over to Rob.

現在讓我把電話轉給羅布。

Thank you, Craig, and good morning, everyone, and thank you for joining us on the call today. In the second quarter, our strong momentum continued, achieving revenues of $2.39 billion and adjusted EPS of $0.91, both of which exceeded the high-end of our guidance ranges. Our non-IFRS operating margin was 6.3%, which was above the midpoint of our revenue and adjusted EPS guidance ranges. We also continued to generate solid adjusted free cash flow, which came in at $63 million during the quarter, bringing our year-to-date total to $129 million.

謝謝克雷格，大家早安，謝謝您今天加入我們的電話會議。第二季度，我們持續保持強勁勢頭，實現營收 23.9 億美元，調整後每股收益 0.91 美元，均超出我們指導範圍的上限。我們的非國際財務報告準則營業利益率為 6.3%，高於我們收入和調整後每股盈餘指引範圍的中點。我們也持續產生穩定的調整後自由現金流，本季達到 6,300 萬美元，使我們年初至今的總現金流達到 1.29 億美元。

Our CCS segment saw a 51% year-to-year increase in revenues in the second quarter and achieved segment margin of 7.2%, which is 120 basis points higher compared to the prior-year period. The top-line growth and margin expansion continued to be supported by large-scale investments in data center infrastructure from our hyperscale customers, including very strong demand for our HPS offering.

我們的 CCS 部門第二季營收年增 51%，部門利潤率為 7.2%，比去年同期高 120 個基點。我們的超大規模客戶對資料中心基礎設施的大規模投資（包括對我們 HPS 產品的強勁需求）持續支撐著營收成長和利潤率擴張。

In our ATS segment, revenues, as anticipated, were lower year-to-year, primarily driven by continued softness in our industrial business. Despite this demand softness, we remain encouraged by the strength in other parts of our ATS portfolio, in particular, we saw solid double-digit revenue growth in both our A&D and capital equipment businesses in the second quarter.

在我們的 ATS 部門，收入正如預期的那樣同比下降，主要是由於我們的工業業務持續疲軟。儘管需求疲軟，我們仍然對 ATS 產品組合其他部分的強勁表現感到鼓舞，特別是第二季度我們的 A&D 和資本設備業務收入均實現了兩位數的穩健增長。

Overall, we are pleased with our solid performance in the first half of the year. Looking ahead, we feel we are very well-positioned to continue to capitalize on a number of high-value opportunities across our portfolio and strengthen our leadership position in key end markets.

整體而言，我們對上半年的穩健表現感到滿意。展望未來，我們認為我們處於有利地位，可以繼續利用我們投資組合中的許多高價值機會，並加強我們在關鍵終端市場的領導地位。

I would now like to turn the call over to Mandeep, who will provide a detailed review on our second quarter performance and our guidance for the third quarter of 2024. Mandeep, over to you.

我現在想將電話轉給 Mandeep，他將對我們第二季的業績以及 2024 年第三季的指導進行詳細審查。

Thank you, Rob, and good morning, everyone. Second quarter revenue came in at $2.39 billion, above the high-end of our guidance range and up 23% year-over-year. The increase was supported by stronger-than-expected growth in our CCS segment, partially offset by demand softness in our ATS segment.

謝謝你，羅布，大家早安。第二季營收為 23.9 億美元，高於我們指引範圍的上限，年增 23%。這一增長得益於 CCS 領域強於預期的增長，但 ATS 領域需求疲軟部分抵消了這一增長。

Second quarter non-IFRS operating margin of 6.3% was an improvement of 80 basis points over the prior-year period. This expansion was driven by meaningfully higher profitability in our CCS segment due to operating leverage, driven by higher volumes and improved mix.

第二季非 IFRS 營運利潤率為 6.3%，比上年同期提高 80 個基點。這種擴張是由於我們的 CCS 部門的獲利能力顯著提高而推動的，這得益於營運槓桿，以及產量增加和組合改善的推動。

Our second quarter adjusted earnings per share was $0.91, which exceeded the high-end of our guidance range and was $0.36 higher year-over-year. This marked our highest quarterly result in company history.

我們第二季調整後每股收益為 0.91 美元，超出了我們指導範圍的上限，年增 0.36 美元。這標誌著我們公司歷史上最高的季度業績。

Our second quarter adjusted effective tax rate was 20%, in-line with our guidance. As anticipated, our adjusted effective tax rate included the in-quarter impact of global minimum tax, which was enacted in Canada during the quarter.

我們第二季調整後的有效稅率為 20%，符合我們的指導。正如預期的那樣，我們調整後的有效稅率包括本季加拿大頒布的全球最低稅的季度影響。

Moving on to our segment performance, ATS segment revenue for the second quarter were $768 million, down 11% year-over-year, slightly more than our expectation of a high single-digit percentage decrease. Decline in ATS segment revenue was driven by continued demand softness in our industrial business, partially offset by year-to-year growth in our A&D and capital equipment businesses. Our ATS segment revenues, other than our industrial business, grew 12% year-to-year in the second quarter. ATS segment revenue accounted for 32% of total revenues in the second quarter.

轉向我們的部門業績，第二季 ATS 部門收入為 7.68 億美元，年減 11%，略高於我們預期的高個位數百分比下降。 ATS 部門收入的下降是由我們的工業業務需求持續疲軟推動的，但部分被我們的 A&D 和資本設備業務的同比增長所抵消。除工業業務外，我們的 ATS 部門營收第二季年增 12%。 ATS部門收入佔第二季總收入的32%。

Our second quarter CCS segment revenue of $1.62 billion was 51% higher compared to the prior-year period, driven by very strong growth in both our enterprise and communications end market. CCS segment revenues accounted for 68% of total company revenues in the second quarter. Revenue in our enterprise end market was up by 37% year-over-year in the second quarter, above our expectations of a low 20 percentage increase, driven by strong demand for AI, ML compute programs. Revenue in our communications end market was higher by 64% compared to the prior-year period, which was better than our expectation of mid-40% increase. The growth in our communications end market was driven by accelerating demand for HPS networking products from our hyperscaler customers, primarily in support of their investments in AI, ML infrastructure.

我們第二季的 CCS 部門營收為 16.2 億美元，比去年同期成長 51%，這得益於我們的企業和通訊終端市場的強勁成長。第二季CCS部門營收占公司總營收的68%。在人工智慧、機器學習計算程式的強勁需求推動下，第二季度我們企業終端市場的營收年增 37%，高於我們預期的 20% 的低成長。我們的通訊終端市場營收較去年同期成長 64%，優於我們預期的 40% 的成長。我們的通訊終端市場的成長是由我們的超大規模客戶對 HPS 網路產品的需求不斷增長所推動的，主要是為了支持他們對人工智慧、機器學習基礎設施的投資。

HPS revenue was $686 million in the second quarter, accounting for 29% of total company revenues and was up 94% year-over-year. The very strong growth in our HPS portfolio was driven by an acceleration in demand for networking products from hyperscaler customers, including 800G switch programs.

第二季HPS營收為6.86億美元，占公司總營收的29%，年增94%。我們的 HPS 產品組合的強勁成長是由超大規模客戶對網路產品（包括 800G 交換器計畫）的需求加速所推動的。

Turning to segment margin. ATS segment margin in the second quarter was 4.6%, down 20 basis points compared to the prior-year period, driven primarily by a reduction in operating leverage at select sites. CCS segment margin during the quarter was 7.2%, up 120 basis points year-over-year as a result of operating leverage and improved mix.

轉向細分市場利潤。第二季 ATS 部門利潤率為 4.6%，比去年同期下降 20 個基點，這主要是由於特定地點營運槓桿的下降。由於營運槓桿和組合改善，本季 CCS 部門利潤率為 7.2%，較去年同期成長 120 個基點。

During the second quarter, we had two customers that accounted for more than 10% of total revenues, representing 32% and 12% of sales for the quarter. We continue to remain comfortable with the current level of concentration in our portfolio, supported by our diversification across multiple programs with our largest customers.

第二季度，我們有兩位客戶佔總收入超過 10%，分別佔該季度銷售額的 32% 和 12%。在我們與最大客戶的多個專案的多元化支持下，我們繼續對目前投資組合的集中度保持滿意。

Moving on to some additional financial metrics. IFRS net earnings for the second quarter were $100 million or $0.83 per share, compared to $56 million or $0.46 per share in the prior-year period. Adjusted gross margin for the second quarter was 10.6%, up 90 basis points year-over-year due to improved mix, production efficiencies and operating leverage. Our adjusted ROIC for the second quarter was 26.7%, an improvement of 6.7% compared to the prior-year quarter, driven by higher profitability and effective working capital management.

接下來討論一些額外的財務指標。第二季依照國際財務報告準則計算的淨利為 1 億美元，即每股 0.83 美元，而去年同期淨利為 5,600 萬美元，即每股 0.46 美元。由於產品組合、生產效率和營運槓桿的改善，第二季調整後毛利率為 10.6%，較去年同期成長 90 個基點。在更高的獲利能力和有效的營運資本管理的推動下，第二季調整後的投資報酬率為 26.7%，比去年同期提高了 6.7%。

Moving on to working capital. At the end of the second quarter, our inventory balance was $1.85 billion, down $106 million sequentially and down $493 million year-over-year. Cash deposits were $576 million at the end of the quarter, lower by $143 million sequentially and down $233 million compared to the prior-year period. As anticipated, we are returning some of our cash deposits from certain customers as gross inventory amounts reduce. Cash cycle days were 64 during the first quarter, down 5 days sequentially and 9 days lower than the prior-year period.

轉向營運資金。截至第二季末，我們的庫存餘額為 18.5 億美元，季減 1.06 億美元，年減 4.93 億美元。本季末現金存款為 5.76 億美元，較上一季減少 1.43 億美元，比去年同期減少 2.33 億美元。正如預期的那樣，隨著庫存總量減少，我們將退還某些客戶的部分現金押金。第一季現金週期天數為 64 天，較上一季減少 5 天，比去年同期減少 9 天。

Moving on to our cash flows. Capital expenditures for the quarter were $37 million or approximately 1.5% of revenue compared with 1.7% in the second quarter of 2023. We now expect our capital expenditures for 2024 to be between 1.5% and 2% of revenues, slightly below our previous outlook of between 1.75% and 2.25% due to the higher-than-anticipated annual revenue outlook.

繼續我們的現金流。本季的資本支出為3,700 萬美元，約佔營收的1.5%，而2023 年第二季為1.7%。的預期由於年度收入前景高於預期，公司的利潤率在 1.75% 至 2.25% 之間。

In the second quarter, we generated $63 million of adjusted free cash flow compared to $67 million in the prior-year period. We have generated $129 million of adjusted free cash flow year-to-date in 2024 compared to $76 million during the same period in 2023. We are pleased with our strong cash conversion and consistency in generating positive free cash flow on quarterly basis, while also making the necessary investments to support our growth.

第二季度，我們產生了 6,300 萬美元的調整後自由現金流，而去年同期為 6,700 萬美元。 2024 年年初至今，我們已產生 1.29 億美元的調整後自由現金流，而 2023 年同期為 7,600 萬美元。進行必要的投資以支持我們的成長。

Moving on to some additional key metrics. At the end of the second quarter, our cash balance was $434 million. In combination with our borrowing capacity under our revolver, this provides us with approximately $1.2 billion in total liquidity, which we believe is sufficient to meet our anticipated business needs. Our gross debt at the end of the second quarter was $750 million, leaving us with a net debt position of $316 million. Our gross debt to non-IFRS trailing 12-month adjusted EBITDA leverage ratio was 1.1 turns, up 0.1 turns sequentially and down 0.1 turn compared to the same period last year.

繼續討論一些其他關鍵指標。第二季末，我們的現金餘額為 4.34 億美元。加上我們的循環貸款能力，這為我們提供了約 12 億美元的總流動資金，我們相信這足以滿足我們預期的業務需求。第二季末我們的總負債為 7.5 億美元，淨負債部位為 3.16 億美元。我們的總債務與非國際財務報告準則的過去 12 個月調整後 EBITDA 槓桿率為 1.1 倍，比上一季上升 0.1 倍，與去年同期相比下降 0.1 倍。

During the quarter, we amended and upsized our credit facility, increasing our revolver capacity from $600 million to $750 million, and entering into a new term loan A and B loans for a total of $750 million The proceeds from the new term loans were used to pay down the outstanding balances on and terminate the previous term loans and repay the outstanding amounts under the revolver. As of June 30, 2024, we were compliant with all financial covenant under our credit agreement.

本季度，我們修改並擴大了信貸安排，將循環貸款能力從 6 億美元增加到 7.5 億美元，並簽訂了總計 7.5 億美元的新定期貸款 A 和 B 貸款。償還餘額並終止先前的定期貸款，並償還循環貸款下的未償還金額。截至 2024 年 6 月 30 日，我們遵守信用協議下的所有財務契約。

During the second quarter, we repurchased approximately 200,000 shares for cancellation under our normal course issuer bid at a cost of $10 million. Year-to-date, we have repurchased a total of approximately 700,000 shares at a cost of $27 million under the program. We will continue to be opportunistic towards share repurchases for the remainder of 2024.

第二季度，我們回購了大約 20 萬股股票，並根據正常發行人的出價以 1,000 萬美元的成本取消。今年迄今為止，我們已根據該計劃總共回購了約 70 萬股股票，成本為 2,700 萬美元。在 2024 年剩餘時間內，我們將繼續伺機回購股票。

Now turning to our guidance for the third quarter of 2024. Third quarter revenues are expected to be in the range of $2.325 billion to $2.475 billion, which, if the midpoint of this range is achieved, would represent growth of 17% compared to the prior-year period. Third quarter adjusted earnings per share are expected to be in the range of $0.86 to $0.96, which, if the midpoint is achieved, would represent an improvement of $0.26 per share or 40% compared to the prior-year period. If the midpoint of our revenue and adjusted EPS guidance ranges are achieved, non-IFRS operating margin would be 6.3%, which would represent an increase of 60 basis points compared to the third quarter of 2023.

現在轉向我們對 2024 年第三季的指引。第三季調整後每股收益預計在 0.86 美元至 0.96 美元之間，如果達到中點，則每股收益將比去年同期增加 0.26 美元，即 40%。如果達到我們收入和調整後每股盈餘指引範圍的中點，非國際財務報告準則營業利益率將為 6.3%，與 2023 年第三季相比增加 60 個基點。

Our adjusted SG&A expense for the third quarter is expected to be in the range of $73 million to $75 million. And we anticipate our adjusted effective tax rate to be approximately 20% for the third quarter.

我們調整後的第三季 SG&A 費用預計在 7,300 萬美元至 7,500 萬美元之間。我們預計第三季調整後的有效稅率約為 20%。

Now turning to our end market outlook for the third quarter of 2024. In our ATS segment, we anticipate revenue to be down in the low single-digit percentage range year-over-year, driven by softer demand in our industrial business, partly offset by continuing growth in A&D and capital equipment. We anticipate revenues in our communications end market to be up in the low-30% range year-over-year, driven primarily by continued strong demand for HPS networking products.

現在轉向我們對2024 年第三季的終端市場展望。抵銷了A&D 和資本設備的持續成長。我們預計通訊終端市場的營收將年增 30% 左右，這主要是受到對 HPS 網路產品持續強勁需求的推動。

Finally, in our enterprise end market, we expect revenue to be up in the mid-30% range year-over-year, driven by program ramps in our storage business and continued demand for server programs in support of AI, ML compute.

最後，在我們的企業終端市場，我們預計營收將年增 30%，這主要得益於我們儲存業務的程式成長以及對支援 AI、ML 運算的伺服器程式的持續需求。

I’ll now turn the call back over to Rob for a discussion of our end markets and to provide an update to our annual outlook for the overall business.

現在，我將把電話轉回給 Rob，討論我們的終端市場，並提供我們對整體業務的年度展望的最新資訊。

Thank you, Mandeep. Based on our strong performance in the first half of the year and improving visibility across a number of our businesses for the second half of the year, we are pleased to be raising our annual outlook for 2024. For the full year, we now anticipate revenue of $9.45 billion and adjusted EPS of $3.62, which would represent growth of 19% and 49%, respectively, compared to 2023.

謝謝你，曼迪普。基於我們上半年的強勁表現以及下半年多項業務可見度的提高，我們很高興上調 2024 年的年度展望。相較於分別成長19% 和49%。

Our non-IFRS operating margin is now expected to be 6.3%, which would represent a 70-basis-points improvement compared to 2023. And finally, our outlook for adjusted free cash flow of $250 million for 2024 remains unchanged.

我們的非國際財務報告準則營業利益率目前預計為 6.3%，與 2023 年相比提高 70 個基點。

Now moving on to the outlook for our businesses. Beginning with our ATS segment. As anticipated, our ATS segment revenues declined in the first half of 2024 compared to 2023, primarily due to softer demand in our industrial business. For the full year, we now anticipate our ATS segment revenues to be down in the mid single-digit range compared to 2023 and compared to our prior outlook of approximately flat. We continue to anticipate the second half of the year to be sequentially higher compared to the first half.

現在談談我們的業務前景。從我們的 ATS 部分開始。正如預期的那樣，與 2023 年相比，我們的 ATS 部門收入在 2024 年上半年有所下降，這主要是由於我們的工業業務需求疲軟。就全年而言，我們現在預計 ATS 部門的收入將與 2023 年相比將下降到個位數中間，而我們先前的預期大約持平。我們繼續預計下半年的業績將比上半年持續走高。

In our industrial business, we continue to experience softer demand on a year-to-year basis, driven primarily by macroeconomic conditions and excess channel inventory. We expect the overall demand environment to gradually improve in the second half of the year. In our A&D business, we continue to see solid growth, supported by strength in commercial aviation and ramping new wins in defense programs. We expect that this strong demand environment will persist for the remainder of 2024. The outlook for our capital equipment business continues to improve as we are seeing encouraging signs that our recovery is materializing.

在我們的工業業務中，我們的需求繼續逐年疲軟，這主要是受宏觀經濟狀況和通路庫存過剩的推動。我們預計下半年整體需求環境將逐步改善。在我們的航空與國防業務中，在商業航空實力和國防項目新勝利的支持下，我們繼續實現穩健成長。我們預計這種強勁的需求環境將持續到 2024 年剩餘時間。

Across our portfolio, we continue to anticipate solid growth in the second half of the year, supported by strong demand and the ramping of new programs. The recovery in the wafer fab equipment market is being primarily supported by stronger memory demand across both DRAM and NAND. Our latest market forecast and discussions with our customers lead us to believe that the growth will continue into 2025.

在我們的投資組合中，我們繼續預計在強勁需求和新項目增加的支持下，下半年將穩健成長。晶圓廠設備市場的復甦主要受到 DRAM 和 NAND 記憶體需求強勁的支撐。我們最新的市場預測以及與客戶的討論使我們相信這種成長將持續到 2025 年。

A medium-term outlook for the wafer fab equipment market remains positive, supported by growing demand for advanced processes used in AI and machine learning and the continued growth in applications for semiconductors within products across a number of sectors.

晶圓廠設備市場的中期前景仍然樂觀，這得益於對人工智慧和機器學習中使用的先進製程的需求不斷增長，以及多個行業產品中半導體應用的持續增長。

Now turning to our CCS segment. Our CCS segment saw a very strong growth in the second quarter with revenues up 51% compared to the same period in 2023, driven by solid demand in both our enterprise and communications end markets. The broad-based strength across most our end markets continues to be supported by demand from our hyperscale customers, which grew by 93% in the first half of 2024 compared to the same period in 2023.

現在轉向我們的 CCS 部分。在企業和通訊終端市場強勁需求的推動下，我們的 CCS 部門在第二季度實現了非常強勁的成長，營收與 2023 年同期相比成長了 51%。我們大多數終端市場的廣泛實力繼續受到超大規模客戶需求的支持，與 2023 年同期相比，2024 年上半年成長了 93%。

The strength we are seeing in our hyperscaler portfolio is broad based as our growth is being driven by solid demand across multiple technologies, programs and customers. We expect solid demand to support continued year-to-year growth in the second half. In 2024, we anticipate that revenues from our programs with hyperscaler customers will surpass $4.6 billion and will account for more than 70% of our CCS segment revenues.

我們在超大規模產品組合中看到的優勢是廣泛的，因為我們的成長是由多種技術、專案和客戶的強勁需求所推動的。我們預計強勁的需求將支持下半年的持續年成長。到 2024 年，我們預計超大規模客戶專案的收入將超過 46 億美元，占我們 CCS 部門收入的 70% 以上。

As we enter the second half of the year, we are seeing a mix shift within our CCS portfolio, driven largely by the changing needs of our hyperscaler customers. We anticipate incremental growth in networking, driven by healthy demand for our market leading 400G switch products, and ramping programs in the 800G switch, as well as growth in storage.

進入今年下半年，我們看到 CCS 產品組合發生了組合轉變，這主要是由超大規模客戶不斷變化的需求所推動的。我們預計，在市場領先的 400G 交換器產品的健康需求、800G 交換器的提升計劃以及儲存的成長的推動下，網路業務將出現增量成長。

We expect that this strength will more than offset a slight reduction in AI,ML compute, driven by technology transitions in certain sole-sourced programs. We expect to ramp new AI,ML next-generation compute programs in 2025.

我們預計，這種優勢將足以抵消人工智慧、機器學習運算量因某些獨家專案的技術轉型而略有下降的影響。我們預計在 2025 年推出新的 AI、ML 下一代運算程式。

Overall, the demand backdrop for our CCS segment continues to be highly favorable. And as a result, we now expect revenues to be up in the mid-30% range in 2024. Our total company outlook for the second half of 2024 is very positive and we remain focused on executing to serve our customers across our end markets. And we remain confident that our ability to consistently deliver strong financial results, along with prudent capital allocation will enable us to drive long-term value for our shareholders.

整體而言，CCS 領域的需求背景仍然非常有利。因此，我們現在預計 2024 年營收將成長 30% 左右。我們仍然相信，我們持續交付強勁財務業績的能力以及審慎的資本配置將使我們能夠為股東帶來長期價值。

With that, I would now like to turn the call over to the operator for questions. Thank you.

現在，我想將電話轉給接線員詢問問題。謝謝。

(Operator Instructions)

（操作員說明）

Thanos Moschopoulos - BMO Capital Markets

Thanos Moschopoulos - BMO 資本市場

Hi, good morning, and congrats on the quarter. To begin, can you update us on where you are from a capacity perspective? Remind us the timing of the new capacity coming online and just in terms of where you are right now, whether you’re bumping up against some constraints, or what the dynamic looks like in terms of how much more capacity you still have at the moment?

你好，早安，恭喜本季。首先，您能否從產能角度向我們介紹您的最新情況？提醒我們新容量上線的時間，以及您現在所處的位置，是否會遇到一些限制，或者動態情況如何，即您仍然擁有多少容量片刻？

Hi, Thanos, good morning. Yes, we have two capacity expansions going on. One, in Malaysia. We actually opened doors officially in Malaysia on March 1, that’s Kulim, 02 we call it, and products transitioning and the building is ramping. So, we have plenty of capacity in Southeast Asia. In our Thailand facility, the project is actually going according to plan and we’re open for new business in Q1 of 2025. Between now and then we feel like we have ample capacity to support all our customers. Also in North America, we still have ample capacity in our Richardson, Texas facility as well.

嗨，薩諾斯，早安。是的，我們正在進行兩次產能擴張。一、在馬來西亞。實際上，我們於 3 月 1 日在馬來西亞（即 Kulim，我們稱之為 02）正式開業，產品正在轉型，建築正在擴建。所以，我們在東南亞有充足的產能。在我們的泰國工廠，該專案實際上正在按計劃進行，我們將於 2025 年第一季開放新業務。同樣在北美，我們位於德州理查森的工廠也仍擁有充足的產能。

And in response to the strong demand, you're seeing down, is there any change to your CapEx plans as you look out over the next few months? Or are you maintaining your prior plans of upfront? Right now?

為了因應強勁的需求，您會看到，未來幾個月您的資本支出計畫是否有任何變化？或是您維持先前的前期計劃？現在？

Right now, we’re maintaining our current plans. We don’t anticipate any major investments moving forward, but we’re always keeping a very close eye on it. It’s just very fine line of making sure that we have full factories, but not too full that we’re turning away demand. And so far, we’ve been able to ride that very tight line and keep utilization high and keep our operations and volume productivity very high.

目前，我們正在維持目前的計劃。我們預計未來不會有任何重大投資，但我們始終密切關注。確保我們擁有完整的工廠，但又不會太滿而導致我們拒絕需求，這是非常好的做法。到目前為止，我們已經能夠在非常緊張的情況下保持高利用率，並保持我們的營運和產量非常高。

Thanos, as you know, we’ve been operating between the 1.5% and 2% of revenue CapEx range for a number of years now, and that continues to be the range, I would say, as you look forward over the next three or four years. The vast majority of that is actually targeted towards growth CapEx. Our maintenance is less than 50 basis points. And so, it gives us a lot of discretion on how we allocate those dollars to meet the immediate needs, but also the long-term needs. So, to Rob’s point, the CapEx spending that we’ve been having will likely continue at those levels going forward.

Thanos，如您所知，我們多年來一直在收入的 1.5% 到 2% 的資本支出範圍內運營，而且我想說，當您展望未來三年時，這仍然是這個範圍或四年。其中絕大多數實際上是為了成長資本支出。我們的維持利率低於 50 個基點。因此，它為我們提供了極大的自由裁量權，可以決定如何分配這些資金以滿足眼前的需求，同時也滿足長期的需求。因此，按照羅布的觀點，我們一直以來的資本支出未來可能會繼續維持在這些水準。

Great.

偉大的。

Last one for me. Just regarding the program transitions on the server business, how should we think about that from a timing perspective? So, it seems that Q3 enterprise will be down sequentially. Does that dynamic continue as far to Q4? Or at what point would you expect sequential growth to resume in enterprise as the new programs start to ramp up?

最後一張給我。就伺服器業務的程式轉型而言，我們從時序角度該如何思考？如此看來，Q3企業將季減。這種動態會持續到第四季嗎？或者，隨著新計劃的開始實施，您預計企業將在什麼時候恢復連續成長？

Good question, Thanos. This is the benefit of having a diverse portfolio across all of CCS, but within enterprise specifically within AI compute, what we’re seeing now is this technology transition on the single-sourced program, it will start plateauing and decreasing towards the back end of the year with the new product ramping mid-2025, I would say. The benefit of a diverse portfolio is we’re actually seeing accelerated demand for our HPS networking products and those are actually filling in nicely in the back half of the year and expected to also fill in through all of 2025 as use cases for our networking products increase. Across all of our hyperscaler customers, what we’re seeing now is a move towards more distributed regional data centers due to power constraints. And when you have that, you actually have increased requirement for networking products.

好問題，薩諾斯。這是在整個CCS 中擁有多樣化產品組合的好處，但在企業內部，特別是在人工智慧運算領域，我們現在看到的是單一來源程式的技術轉型，它將開始趨於穩定並朝著後端下降我想說的是，新產品將於 2025 年中期上市。多樣化產品組合的好處是，我們實際上看到了對HPS 網路產品的需求加速成長，這些產品實際上在今年下半年得到了很好的滿足，預計也將在2025 年全年作為我們的網路用例得到滿足產品增加。在我們所有的超大規模客戶中，由於電力限制，我們現在看到的是朝向更分散的區域資料中心發展。當你擁有這些時，你實際上對網路產品的需求增加了。

Yes. Great. I'll pass the line.

是的。偉大的。我會過線。

Matthew Sheerin.

馬修·謝林。

Yes. Good morning. It’s Matt Sheerin from Stifel. Just regarding the commentary on the strength that you’re seeing in communications and the switch business, it sounds like there’s a refresh of 400 gig, because I know that there was a digestion period last year. So, the question there is how long do you see that strength holding up? And then, in terms of 800 gig, obviously, pretty early, but where would you say in terms of the innings, if you will, in terms of the opportunity over the next few quarters for 800 gig?

是的。早安.我是來自 Stifel 的 Matt Sheerin。僅就您在通訊和交換機業務中看到的實力的評論而言，聽起來好像有 400 場演出的刷新，因為我知道去年有一個消化期。那麼，問題是你認為這種力量能持續多久？然後，就 800 場演出而言，顯然，相當早，但是如果您願意的話，就接下來幾個季度 800 場演出的機會而言，您會在哪裡說？

Hi, Matt. Yes, the 400G actually continues to be very strong through all of 2024 and also into 2025. 800G really starts picking up as we exit the year and also into 2025 and beyond. We’re also seeing an acceleration of 1.6. Again that probably won’t ramp until the outyears, but we’re actually seeing an acceleration of moving to that node and we think we’re very well positioned to capture more than our fair share of that program as well.

嗨，馬特。是的，400G 實際上在整個 2024 年以及 2025 年都將繼續保持強勁勢頭。我們還看到加速度為 1.6。同樣，這種情況可能要到幾年後才會增加，但我們實際上看到了向該節點轉移的加速，並且我們認為我們處於非常有利的位置，可以在該計劃中獲得超出我們應有份額的份額。

Okay. Thanks for that. And then, you talked about very strong margins in CCS at 7.6%. And how much of that was driven by the mix of the higher percentage of HPS and communications? And can you remind us the difference in the margin profile of the server business versus the comms business?

好的。感謝那。然後，您談到 CCS 的利潤率非常高，達到 7.6%。其中有多少是由較高比例的 HPS 和通訊共同推動的？您能否提醒我們伺服器業務與通訊業務的利潤狀況有何不同？

Yeah. Hi, Matt. Mandeep here. We don’t break out margins between the end markets, but a couple of things that we have talked about before. One is margins with the hyperscalers in totality are accretive to our margins in CCS, and then margins in HPS are also accretive to overall CCS. And so, the dynamic that you’re seeing right now with hyperscalers continuing to grow, and with our HPS revenue also continuing to grow, that’s helping pull margins up right now. And so, we do think that we continue to have a nice mix in the portfolio and opportunities for more operating leverage as we go forward.

是的。嗨，馬特。曼迪普在這裡。我們沒有詳細列出終端市場之間的利潤率，而是列出了我們之前討論過的一些事情。一是超大規模企業的整體利潤會增加我們 CCS 的利潤，然後 HPS 的利潤也會增加整體 CCS 的利潤。因此，您現在看到的動態是，超大規模企業持續成長，我們的 HPS 收入也持續成長，這有助於提高利潤率。因此，我們確實認為，隨著我們的前進，我們的投資組合將繼續保持良好的組合，並有機會獲得更多的營運槓桿。

Okay, great. And just lastly regarding that inventory reduction you’re seeing, is that mostly on the ATS side and the fact that component lead times are short, or is there some dynamics going on in the CCS business in terms of consigned inventory and that sort of thing, because I would think that you’d be staging inventory for some of these ramps?

好的，太好了。最後，關於您所看到的庫存減少，主要是在 ATS 方面，以及組件交貨時間很短的事實，或者 CCS 業務在寄售庫存等方面是否存在一些動態。坡道準備庫存？

Yeah, it’s actually we’re seeing nice progressions in both ATS and CCS. From a macro perspective, lead times are starting to stabilize, still a little bit elevated, but passes and semis are not that different from each other and they’re both below 20 weeks. And so, what that has done is it’s allowed us to just level load our planning process a little bit better. We have been seeing, I think five quarters in a row now of gross inventory reductions. It’s allowed us to return some deposits to customers, and despite doing that, another quarter of strong free cash flow. And so, both ATS and CCS are turning their inventory nicely.

是的，實際上我們在 ATS 和 CCS 方面都看到了良好的進展。從宏觀角度來看，交付週期開始趨於穩定，但仍略有上升，但通過和半交付並沒有太大區別，而且都低於 20 週。因此，這樣做的作用是讓我們能夠更好地平衡負載我們的規劃流程。我認為我們已經連續五個季度看到庫存總量減少。它使我們能夠向客戶返還部分押金，儘管如此，我們還是獲得了另外四分之一強勁的自由現金流。因此，ATS 和 CCS 都很好地週轉了庫存。

Okay, great. Thanks so much, Mandeep.

好的，太好了。非常感謝，曼迪普。

Steven Fox of Fox Advisors

福克斯顧問公司的史蒂文‧福克斯

Hi, good morning. I guess just following up on the first couple of questions, is there a way to maybe isolate the impact to year-over-year improvements on margins from mix versus operating leverage a little bit further at the corporate level and also the CCS level?

早安.我想，在回答前幾個問題時，有沒有一種方法可以在公司層面和 CCS 層面進一步隔離混合與營運槓桿對利潤率逐年改善的影響？

And then, I had a follow-up.

然後，我進行了跟進。

First of all, welcome, Steven, to the first call.

首先，歡迎史蒂文打第一通電話。

And it’s really nice to have you on. Look, we purposely don’t start breaking out margins at that level, because it’s sometimes impacted by program dynamics in which sites programs fall into. What I can tell you is this, building on what Rob had talked about earlier, we are having very nice levels of utilization in Southeast Asia in particular at the moment.

很高興有你的加入。看，我們故意不開始突破該水準的利潤，因為它有時會受到程式所屬網站的程式動態的影響。我可以告訴你的是，基於 Rob 之前談到的內容，我們目前的使用率非常高，尤其是在東南亞。

The majority of our HPS programs are being built in a select number of sites, and those sites are -- with high levels of utilization are quite profitable. And so, it’s a combination of both operating leverage and pricing that we have within the HPS programs that are leading to the strong profitability.

我們的大多數 HPS 專案都是在選定數量的站點中建立的，而這些站點的利用率高，利潤豐厚。因此，我們的 HPS 計劃中的營運槓桿和定價相結合，帶來了強勁的獲利能力。

But overall, and we’ve talked about this before in some different discussions with the outside community, HPS margins are accretive to overall CCS. They’re not 20% though. It’s not 20% operating margins. And so, that’s why sometimes whether it’s operating leverage or mix of HPS programs, it can often be one or the other, but gets to the same result.

但總的來說，我們之前在與外部社區的一些不同討論中已經討論過這一點，HPS 利潤會增加整體 CCS。但他們還不到 20%。這不是 20% 的營業利潤率。因此，這就是為什麼有時無論是營運槓桿還是 HPS 計劃的組合，通常可以選擇其中之一，但會得到相同的結果。

Great. That’s helpful. And then, just on the ATS business, the end market dynamics you’ve talked about just generally are consistent with what we’re hearing from some others, but like two questions off of that. One is the industrial confidence that like inventories are sort of washing out soon and what kind of growth you can return to? And then secondly, I think you’ve talked about new programs in healthcare as well. Can you sort of talk about how those are ramping and the impact on growth there? Thank you.

偉大的。這很有幫助。然後，就 ATS 業務而言，您所談論的終端市場動態總體上與我們從其他一些人那裡聽到的情況一致，但有兩個問題。一是工業界的信心，庫存很快就會被沖走，你能恢復什麼樣的成長？其次，我認為您也談到了醫療保健方面的新計劃。您能談談這些是如何成長的以及對那裡成長的影響嗎？謝謝。

Sure, Steven. Yeah, so across our ATS, we’re actually seeing some very nice growth with the exception of our industrial business. ATS actually grew 12% year-over-year in the second quarter. So, it’s really isolated to industrial.

當然，史蒂文。是的，所以在我們的 ATS 中，除了工業業務之外，我們實際上看到了一些非常好的成長。 ATS 第二季度實際上同比增長了 12%。因此，它確實與工業隔絕。

Now, within industrial, we’re seeing softness in energy, namely EV chargers and also broad industrial markets, factory automation largely, and it’s being driven by excess channel inventory. As the year gets long, we actually are seeing that channel inventory is being consumed and we’re seeing an uptick in demand as we exit the year and we’re expecting our industrial business to return to growth in 2025.

現在，在工業領域，我們看到能源領域的疲軟，即電動車充電器以及廣闊的工業市場，很大程度上是工廠自動化，這是由通路庫存過剩所推動的。隨著時間的推移，我們實際上看到通路庫存正在消耗，隨著今年的結束，我們看到需求上升，我們預計我們的工業業務將在 2025 年恢復成長。

Again, outside of industrial, we’re seeing some very nice growth with capital equipment and it’s actually improving. Our outlook is improving on a quarter-to-quarter basis. And A&D continues to have very strong demand and we see that demand at least lasting through the end of this year.

同樣，在工業之外，我們看到資本設備出現了非常好的成長，而且實際上正在改善。我們的前景逐季改善。 A&D 的需求仍然非常強勁，我們認為這種需求至少會持續到今年年底。

And just the healthcare piece like the new programs?

只是像新計劃這樣的醫療保健部分嗎？

Yeah, I mean, healthcare, thank you for reminding me. So, within healthcare, this year is largely flattish, but it’s really being driven by some programs that are going end of life and with those new programs starting to ramp in the first half of next year. So, it’s really program dynamics more than anything else, but we do have some one business, some ramps that are just starting right now, which we expect to pay dividends in 2025.

是的，我的意思是，醫療保健，謝謝你提醒我。因此，在醫療保健領域，今年基本上表現平平，但這實際上是由一些即將結束的項目以及這些新項目在明年上半年開始增加所推動的。所以，這實際上是專案動態比其他任何事情都重要，但我們確實有一些業務，一些現在才剛開始的斜坡，我們預計將在 2025 年支付紅利。

Got it. Thank you very much.

知道了。非常感謝。

Daniel Chan of TD Cohen.

TD Cohen 的 Daniel Chan。

Good morning. Rob, you mentioned last year that in the next generation of your AI compute servers, there’s potential to have more Celestica IP in them. Is it fair to assume that these next-generation servers that you’re transitioning to next year could carry a higher ASP and higher margins as well?

早安. Rob，您去年提到，在下一代 AI 運算伺服器中，有可能擁有更多 Celestica IP。假設您明年過渡到的這些下一代伺服器也可以帶來更高的平均售價和更高的利潤，這是否公平？

Yeah. Typically what happens on HPS products, as these products server products transition from high-value EMS into HPS, they will carry higher margins because they have higher value add. If they stay EMS and during the technology transition node, what we see is early in the lifecycle of new product introduction, the ASPs are higher and as the volumes pick up and over time the ASPs tend to come down and normalize over a little bit, and that has been true and continues to be true in all product lifecycle pricing. But again, as products transition from EMS to HPS, the margins will increase because of the higher value add.

是的。 HPS 產品通常會發生這種情況，隨著這些產品伺服器產品從高價值 EMS 過渡到 HPS，它們將帶來更高的利潤，因為它們具有更高的附加價值。如果他們保持EMS 並且在技術過渡節點期間，我們看到的是新產品推出生命週期的早期，ASP 會更高，隨著銷量的增加，隨著時間的推移，ASP 往往會下降並正常化一點點，這在所有產品生命週期定價中都是如此，並將繼續如此。但同樣，隨著產品從 EMS 過渡到 HPS，由於附加價值更高，利潤將會增加。

That’s helpful. Thank you. And then maybe switching over to the communication side, do you have visibility on whether the mix of white box versus OEM networking equipment will be different going forward in these newer AI data centers versus what they had in the non-AI data centers? Thank you.

這很有幫助。謝謝。然後也許切換到通訊方面，您是否了解白盒與 OEM 網路設備的組合在這些較新的 AI 資料中心與非 AI 資料中心中是否會有所不同？謝謝。

Dan, sorry, can you repeat that last part?

丹，抱歉，你能重複最後一部分嗎？

Yeah. Just wondering with your discussions with your hyperscale customers, whether you have any visibility on whether they’re looking to change the mix of white box networking equipment like the ones that you make versus choosing an OEM supplier in these next-generation AI data centers?

是的。只是想知道，透過與超大規模客戶的討論，您是否了解他們是否正在尋求改變白盒網路設備（例如您製造的設備）的組合，而不是在這些下一代人工智慧資料中心選擇 OEM 供應商？

Yeah. Our hyperscale customers are continuing to embrace and adopt disaggregated model and continuing to buy more from folks like ourselves than switching to an OEM model. There is also a new class of customers that are emerging. We are calling them digital natives. And those class of customers have the capability to build and operate their own data centers and they are also adopting an open architecture disaggregated model. And we are very excited about this new class of customers, because they are actually a new source of growth for us with respect to our white boxing and all the technologies that we provide to the data center.

是的。我們的超大規模客戶正在繼續接受和採用分類模型，並繼續從像我們這樣的人那裡購買更多產品，而不是轉向 OEM 模型。還有一類新的客戶正在出現。我們稱他們為數位原住民。這類客戶有能力建構和營運自己的資料中心，他們也採用開放架構分解模型。我們對這一類新客戶感到非常興奮，因為就我們的白盒和我們向資料中心提供的所有技術而言，他們實際上是我們新的成長來源。

Great. Thank you. And then maybe just one more. The storage strength that you’re seeing, are those related to AI data center buildouts as well or are those more traditional cloud data center type deployments? Thank you.

偉大的。謝謝。然後也許還有一個。您所看到的儲存強度是否也與人工智慧資料中心擴建相關，或者是那些更傳統的雲端資料中心類型部署？謝謝。

Yeah, it’s hard to discern, Dan. We think that it’s due to the AI buildout, but every one of our hyperscalers has a different storage architecture, some are going embedded, some are going external. So, what we’re seeing here is more of program dynamics, but we think the overall trend is AI is driving the need for more data and more data driving the need for more storage, hence we are seeing an uptick in demand.

是的，這很難辨別，丹。我們認為這是由於人工智慧的擴展，但我們的每個超大規模伺服器都有不同的儲存架構，有些是嵌入式的，有些是外部的。因此，我們在這裡看到的更多是程式動態，但我們認為總體趨勢是人工智慧正在推動對更多數據的需求，而更多數據推動對更多儲存的需求，因此我們看到需求在上升。

Thanks, lot.

謝謝，很多。

Paul Treiber of RBC Capital Markets.

加拿大皇家銀行資本市場的保羅‧特雷伯 (Paul Treiber)。

Thanks very much. Good morning. Just wanted to speak about the breadth of the programs you have going on, particularly the large customers. Specifically, can you just speak to or give examples of the magnitude of or the extent of the breadth there? And then, could you also speak to the second 10%-plus customer in terms of what segment that customer is in and the historical relationship with that customer?

非常感謝。早安.只是想談談你們正在進行的計劃的廣度，特別是大客戶。具體來說，您能談談或舉例說明那裡的廣度或範圍嗎？然後，您能否也與第二個 10% 以上的客戶談談該客戶屬於哪個細分市場以及與該客戶的歷史關係？

Yeah. I’ll talk about the second one first. So, the second 10% customer is also hyperscaler. In fact, across all of our hyperscalers, we've experienced some significant growth. We’ve been doing business with this hyperscaler for decades, so very long period of time.

是的。我先談談第二個。因此，第二個 10% 的客戶也是超大規模客戶。事實上，在我們所有的超大規模企業中，我們都經歷了一些顯著的成長。我們與這家超大規模企業開展業務已經有幾十年了，時間很長。

And this customer plus all our customers, we provide them and have the capability to provide them with a full suite of solutions, so everything from networking to compute to storage devices. What they're buying from us varies at different points in time, but we certainly have the capability to provide a full suite of products to all of our hyperscalers.

這個客戶加上我們所有的客戶，我們為他們提供並且有能力為他們提供全套解決方案，從網路到計算到儲存設備的一切。他們從我們這裡購買的產品在不同的時間點會有所不同，但我們當然有能力為所有超大規模企業提供全套產品。

And second question is just on the AL/ML compute program transitions. Is that -- you mentioned sole-sourced, is that primarily one customer, one program, or is it several transitions either at several customers or several programs at a customer at the same time? And related to that, could you speak to just the overall breadth of your AL compute business?

第二個問題是關於 AL/ML 計算程式的轉換。您提到的單一來源，主要是一個客戶、一個項目，還是同時在多個客戶或一個客戶的多個項目上進行多次轉換？與此相關，您能談談您的 AL 運算業務的整體範圍嗎？

Yeah. So, it’s one customer, several programs. And again, those will be (technical difficulty) as customer continues to (technical difficulty) innovation and introduces new products. With respect to our AI compute customer base, right now we have one very large customer on that.

是的。因此，一個客戶，多個程序。再說一遍，隨著客戶不斷（技術難度）創新並推出新產品，這些將成為（技術難度）。就我們的人工智慧運算客戶群而言，目前我們有一個非常大的客戶。

Yeah. And then, to your to the question also, Paul, right now as Rob has talked about before, it's high-value EMS across a number of different programs. Our HPS roadmaps have compute in there as well. We’re starting to gain some nice traction. And so, we do see opportunities as we go into '25 and beyond for our HPS portfolio to not only continue to provide very leading-edge networking gear, but we're also now moving more meaningfully into the server side as well into the compute side.

是的。然後，對於你的問題，Paul，正如 Rob 之前談到的，現在是跨多個不同項目的高價值 EMS。我們的 HPS 路線圖也包含計算。我們開始獲得一些良好的牽引力。因此，當我們進入 25 年及以後時，我們確實看到了機會，我們的 HPS 產品組合不僅繼續提供非常領先的網路設備，而且我們現在還更有意義地進入伺服器端以及計算領域邊。

And lastly, I would also add as the AI, ML compute market continues to grow, especially in custom silicon application, this really plays to our strength. And given our strong track record that we have with our largest customer, we feel we're on a short list of players who can serve this market, especially as it pertains to not just high-value EMS, but JDM and HPS solutions that we could migrate to. So as such, we continue to explore a lot of additional opportunities and we have a lot of confidence that that portfolio will continue to grow within Celectica.

最後，我還要補充一點，隨著人工智慧、機器學習運算市場的持續成長，特別是在客製化晶片應用中，這確實發揮了我們的優勢。鑑於我們與最大客戶的良好往績記錄，我們認為我們是可以服務這個市場的少數參與者，特別是因為它不僅涉及高價值 EMS，還涉及我們的 JDM 和 HPS 解決方案。因此，我們將繼續探索許多額外的機會，我們非常有信心該產品組合將在 Celectica 內繼續成長。

You mentioned that the next generation in ‘25, it sounds like you’ve already won it, so there's good visibility there, but typically, what's the visibility you get in terms of the duration of these programs and how early are they awarded? And then, could you give us a sense of like the pipeline per se for expanding your AI/ML compute business into other customers?

您提到 25 年的下一代，聽起來您已經贏得了它，因此那裡有很好的可見性，但通常情況下，您在這些計劃的持續時間方面獲得的可見性以及它們有多早授予？然後，您能給我們一種將 AI/ML 運算業務擴展到其他客戶的管道本身的感覺嗎？

Yeah, we typically get about a year of visibility. I would say as programs transition from one technology to the next, so we have pretty good visibility when it comes to the transition. Certainly, with our largest customer, that visibility is a bit extended, because we constantly share technology roadmaps. And then, the funnel for additional AI compute programs is quite large actually. We're engaged with a number of different customers across a number of different opportunities as they are all looking to develop custom silicon solutions. And again, for me, it's just a matter of time before we win several of these opportunities and add them to our backlog.

是的，我們通常會獲得大約一年的可見度。我想說，隨著程式從一種技術過渡到另一種技術，因此我們在過渡方面具有相當好的可見性。當然，對於我們最大的客戶來說，這種可見性有所擴大，因為我們不斷分享技術路線圖。然後，額外的人工智慧計算程式的漏斗實際上相當大。我們透過許多不同的機會與許多不同的客戶合作，因為他們都希望開發客製化的晶片解決方案。再說一次，對我來說，我們贏得其中一些機會並將其添加到我們的待辦事項中只是時間問題。

Jesse padlock of Cormark Securities.

Cormark 證券的傑西掛鎖。

Hey, good morning. There are some concerns over overinvestment in AI infrastructure by some of your hyperscaler customers. Can you maybe speak to the sense of urgency you’re seeing from these customers for their buildouts and how that might compare to what it was six to 12 months ago?

嗨，早安。對於一些超大規模客戶對人工智慧基礎設施的過度投資存在一些擔憂。您能否談談您從這些客戶那裡看到的擴建的緊迫感以及與 6 到 12 個月前相比如何？

Yeah. When we talk to our customers, they feel that we’re at the early innings of what they’re calling a transformative era. And they also view that the risk of underinvesting is much higher than the risk of overinvesting. So, they’re actually making the hard decisions within their individual businesses to make sure they preserve the investment in spending on the appropriate technologies to further the AI revolution, if you will.

是的。當我們與客戶交談時，他們覺得我們正處於他們所說的變革時代的早期階段。他們也認為，投資不足的風險遠高於投資過度的風險。因此，他們實際上是在各自的業務中做出艱難的決定，以確保他們保留對適當技術的投資，以進一步推動人工智慧革命（如果你願意的話）。

Just, Jesse, adding to Rob’s comment, I know there’s a lot of conversations around what does hyperscale or AI, ML spend look like going into next year and the year after, and that information is not as widely discussed as any of us would like. But I think what we can talk about are the programs that we are winning and the programs that we are ramping. We typically have up to a year of visibility on when revenue is going to start to materialize and we are not seeing a slowdown right now. If anything, we’re seeing an acceleration on our new wins. And it’s nice because we’re seeing it across a diverse set of technologies and across a diverse set of customers. And so right now, based on the bookings that we’ve been having, it definitely positions us for a strong '25.

只是，Jesse，補充 Rob 的評論，我知道有很多關於明年和後年超大規模或人工智慧、機器學習支出的討論，而這些資訊並沒有像我們任何人都願意。但我認為我們可以談論的是我們正在贏得的項目和我們正在推進的項目。我們通常對收入何時開始實現有長達一年的了解，而且我們目前還沒有看到收入放緩的情況。如果有什麼不同的話，那就是我們看到了新勝利的加速成長。這很好，因為我們看到它跨越了不同的技術和不同的客戶。因此，現在，根據我們一直以來的預訂量，這無疑使我們在 25 週年的表現中處於有利地位。

Thanks. That’s helpful. And then just --?

謝謝。這很有幫助。然後只是——？

The last thing I’ll add is when we look at customer CapEx spending, which we do all the time, the second and third question we ask ourselves is within those broad numbers, what actually are they buying and who are they buying it from. And we feel based on those two questions that we are very well positioned to participate in future growth.

我要補充的最後一件事是，當我們專注於客戶資本支出支出時（我們一直在這樣做），我們問自己的第二個問題和第三個問題是在這些廣泛的數字中，他們實際上在購買什麼以及他們從誰那裡購買。基於這兩個問題，我們認為我們處於參與未來成長的有利位置。

Got it. And then, just tariff and trade restrictions have been in the news headlines past couple of weeks. Can you maybe just speak a little bit to the conversations that you’re having with your customers on these topics? And then, just thinking about your footprint and your customers’ needs, what would the opportunity be like to win more programs if some of these restrictions get enacted?

知道了。然後，過去幾週的新聞頭條中只有關稅和貿易限制。您能否簡單談談您與客戶就這些主題進行的對話？然後，只要考慮一下您的足跡和客戶的需求，如果頒布其中一些限制，贏得更多計劃的機會會怎麼樣？

The beginning part broke out, Jesse. You’re talking about China restrictions?

開始部分爆發了，傑西。你是在談論中國的限制嗎？

Yes, that's correct.

對，那是正確的。

US? Okay. Yeah, we’ve been keeping a very close eye on that. Stepping back, it has not been new news that advanced chips and semiconductor capital equipment, advanced equipment has been restricted. For a while, there is some noise out there that those restrictions will increase with respect to a new class of chips. And we’re keeping close eyes on that. But based on where our factories are and where our design centers are and our ability to be able to ramp those centers up, we feel comfortable that we’re going to be able to move in a very agile way depending on what happens or what doesn’t happen in the future. We have ample capacity in all our regions with respect to Southeast Asia, Mexico, Europe and North America. We operate in 16 countries. So, based on our vast footprint and our scale, we think we could actually move pretty quickly such something unanticipated happen.

我們？好的。是的，我們一直在密切關注這一點。退一步來說，先進晶片和半導體資本設備、先進設備受到限制已經不是什麼新鮮事了。一段時間以來，有一些聲音稱，對於新型晶片，這些限制將會增加。我們正在密切關注這一點。但根據我們的工廠所在地、設計中心所在地以及我們擴大這些中心的能力，我們感到放心，我們將能夠根據發生的情況或情況以非常敏捷的方式採取行動未來不會發生。我們在東南亞、墨西哥、歐洲和北美等所有地區都擁有充足的產能。我們在 16 個國家開展業務。因此，根據我們龐大的足跡和規模，我們認為我們實際上可以很快採取行動，以免發生意想不到的事情。

Thank you. I’ll pass the line.

謝謝。我會過線。

Todd Coupland of CIBC.

CIBC 的托德·科普蘭。

Thanks, and good morning, everyone. I was just wondering if you’re able to put any context around the new servers, the custom chip-based servers relative to the business you’ve seen thus far. Do you view it as an incremental step up from a volume point of view? Any way to give us some color on that?

謝謝，大家早安。我只是想知道您是否能夠對新伺服器（與您迄今為止所看到的業務相關的基於定制晶片的伺服器）提供任何背景資訊。從數量的角度來看，您是否認為這是一個增量步驟？有什麼辦法可以讓我們對此有所了解嗎？

Yes. Good morning, Todd. From a volume perspective, we do see that the next generation of AI compute servers will be, I’d say, comparable to a bit higher than the current generation of AI compute servers. Obviously, they’ll be more powerful, but at the same time, the demand continues to increase. So, the volumes that we’re anticipating, I would say, would be a touch higher. That being said, these technology transitions, there is a little bit of a gap in between one going down and the other one going up, so it’s not an instant transition. But for our earlier Q&A, we are filling in that gap with HPS networking products.

是的。早安，陶德。從數量角度來看，我們確實看到下一代人工智慧運算伺服器將比當前一代人工智慧運算伺服器稍高一些。顯然，它們會更加強大，但同時，需求也在增加。因此，我想說，我們預期的銷量會略高一些。話雖如此，在這些技術轉型中，一種技術的下降和另一種技術的上升之間存在著一點差距，因此這不是一個即時的過渡。但對於我們先前的問答，我們正在使用 HPS 網路產品來填補這一空白。

Yes, good morning, Todd. And from a volume perspective, we do see that the next generation of them and AI compute servers will be, I'd say, comparable to a bit higher than the current generation of AI compute servers. Obviously, there'll be some more powerful, but at the same time, the demand continues to increase so the volumes that we're anticipating, I would say would be a touch higher. That being said, is these technology transitions on the there is a little bit of a gap in between one going down and the other one going up. So it's not an instant transition, but for our earlier Q&A, we are filling in that gap with HPS. networking products it, Todd.

是的，早上好，托德。從數量角度來看，我們確實看到下一代人工智慧運算伺服器將比當前一代人工智慧運算伺服器稍高一些。顯然，將會有一些更強大的產品，但同時，需求繼續增加，因此我們預期的數量，我想說會更高。話雖這麼說，這些技術轉型是否存在一種下降與另一種上升之間的差距。因此，這不是即時過渡，但對於我們先前的問答，我們正在使用 HPS 填補這一空白。網路產品吧，托德。

We're having discussions with customers right now on programs that are going out into 2027. And we're seeing based on demand, not only the chip next generation technology on the chip volume levels that are at today's levels or higher. And again, that's on programs stretch out to 27. But I don't know if you have a follow-up or not.

我們現在正在與客戶就 2027 年之前的計劃進行討論。再說一次，這是關於延長到 27 個項目的情況。

Thank you. (Operator Instructions) And there are no further questions at this time. I’d now like to turn the call back over to Rob Mionis for closing comments.

謝謝。 （操作員說明） 目前沒有其他問題。我現在想將電話轉回給羅布·米奧尼斯 (Rob Mionis) 徵求結束意見。

Thank you. And thank you all for joining us this morning. I’m pleased that we posted another solid quarter and the strong momentum is giving us confidence to increase the outlook for 2024. I’m also pleased by continued strong execution and encouraged with our strong market position, especially with new products like 800G in strong and growing markets. Thank you again for joining today’s call, and Mandeep and I look forward to updating you next quarter.

謝謝。感謝大家今天早上加入我們。我很高興我們又發布了一個穩定的季度業績，強勁的勢頭讓我們有信心提高2024 年的前景。等新產品在強勁且不斷成長的市場中。再次感謝您參加今天的電話會議，曼迪普和我期待下季向您通報最新情況。

Ladies and gentlemen, this concludes today's conference. We thank you for participating and ask that please disconnect your line.

女士們、先生們，今天的會議到此結束。我們感謝您的參與，並請斷開您的線路。