Diodes Inc (DIOD) 2016 Q4 法說會逐字稿

Good afternoon and welcome to Diodes Incorporated's fourth quarter and full-year 2016 financial results conference call. (Operator Instructions) As a reminder, this conference call is being recorded today, Tuesday, February 14, 2017. I would now like to turn the call over to Brett Perry. Mr. Perry, please go ahead.

下午好，歡迎參加 Diodes 公司 2016 年第四季和全年財務業績電話會議。 （操作員說明）謹此提醒，本次電話會議將於今天（2017 年 2 月 14 日星期二）錄製。我現在想將電話轉給 Brett Perry。佩里先生，請繼續。

Good afternoon and welcome to Diodes' fourth quarter and full-year 2016 financial results conference call. I'm Brett Perry, Vice President of Shelton Group, Diodes' investor relations firm. Joining us on today's call are Diodes' President and CEO, Dr. Keh-Shew Lu; Chief Financial Officer, Rick White; Senior Vice President of Sales and Marketing, Mark King; and Director of Investor Relations, Laura Mehrl.

下午好，歡迎參加 Diodes 2016 年第四季和全年財務業績電話會議。我是 Brett Perry，Diodes 投資者關係公司 Shelton Group 的副總裁。參加今天電話會議的還有 Diodes 總裁兼執行長 Keh-Shew Lu 博士；首席財務官，里克懷特；銷售與行銷資深副總裁 Mark King；和投資者關係總監 Laura Mehrl。

Before I turn the call over to Dr. Lu, I'd like to remind our listeners that the results announced today are preliminary, as they are subject to the Company finalizing its closing procedures and customer quarterly review by the Company's registered independent registered public accounting firm. As such, these results are subject to revisions until the Company filed its annual report on Form 10-K for the fiscal year 2016.

在我把電話轉給盧博士之前，我想提醒我們的聽眾，今天公佈的結果是初步的，因為它們取決於公司最終確定的結帳程序以及公司註冊的獨立註冊公共會計的客戶季度審查公司。因此，在公司提交 2016 財年 10-K 表格年度報告之前，這些結果可能會進行修訂。

In addition, management's prepared remarks contain forward-looking statements which are subject to risk and uncertainties and management may make additional forward-looking statements in response to your questions. Therefore, the Company claims the protection of the Safe Harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from those discussed today and therefore we refer you to a more detailed discussion of the risks and uncertainties in the Company's filings with the Securities and Exchange Commission.

此外，管理層準備的言論包含前瞻性陳述，這些陳述存在風險和不確定性，管理層可能會針對您的問題做出額外的前瞻性陳述。因此，本公司聲稱受到 1995 年《私人證券訴訟改革法案》中包含的前瞻性陳述的安全港保護。實際結果可能與今天討論的結果有所不同，因此我們建議您參閱有關風險的更詳細討論以及公司向美國證券交易委員會提交的文件中的不確定性。

In addition, any projections as to the Company's future performance represent management's estimates as of today, February 14, 2017. Diodes assumes no obligation to update these projections in the future as market conditions may or may not change. Additionally, the Company's press release and management's statements during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms. Included in the Company's press release are definitions and reconciliations of GAAP to non-GAAP items which provide additional details. Also, throughout the Company's press release and management's statements during this conference call, we refer to net income attributable to common stockholders as GAAP net income.

此外，有關公司未來業績的任何預測均代表管理層截至今天（2017 年 2 月 14 日）的估計。由於市場狀況可能會或可能不會發生變化，Diodes 不承擔未來更新這些預測的義務。此外，本公司在本次電話會議期間的新聞稿和管理層聲明將包括以公認會計原則和非公認會計原則術語討論某些措施和財務資訊。該公司的新聞稿中包括 GAAP 與非 GAAP 項目的定義和調節，其中提供了更多詳細資訊。此外，在本次電話會議期間公司的新聞稿和管理層聲明中，我們將歸屬於普通股股東的淨利潤稱為 GAAP 淨利潤。

For those of you unable to listen to the entire call at this time, a recording will be available via webcast for 60 days in the investor section of Diodes' website at www.diodes.com. And now I'll turn the call over to Diodes' President and CEO, Dr. Keh-Shew Lu. Dr. Lu, please go ahead.

對於目前無法收聽整個電話會議的人士，可在 Diodes 網站 www.diodes.com 的投資者部分透過網路廣播提供為期 60 天的錄音。現在我將把電話轉給 Diodes 總裁兼執行長 Keh-Shew Lu 博士。盧醫生，請講。

Thank you, Brett. Welcome, everyone, and thank you for joining us today. Diodes closed out another solid year in which we achieved record revenue and gross profit, driven by increased content at customers, as well as higher contribution from our new products. We also made solid progress on our integration of Pericom Semiconductor throughout the year, which sets the stage for expanded growth opportunity in 2017. Additionally, our automotive revenue reached a record level, increasing almost 50% over the previous years and representing 7% of our annual revenue.

謝謝你，布雷特。歡迎大家，感謝您今天加入我們。 Diodes 又迎來了堅實的一年，在客戶內容增加以及新產品貢獻增加的推動下，我們實現了創紀錄的收入和毛利。我們在全年對Pericom Semiconductor 的整合方面也取得了紮實的進展，這為2017 年擴大成長機會奠定了基礎。此外，我們的汽車收入達到了創紀錄的水平，比前幾年增長了近50% ，占我們收入的7%。年收入。

Over the past three years, Diodes has significantly advanced our automotive strategy through investment in new products and customer expansion. Going forward, we expect to further expand revenue growth and to capture additional share through new product introduction and design wins.

在過去三年中，Diodes 透過投資新產品和擴大客戶群，顯著地推進了我們的汽車策略。展望未來，我們預計將進一步擴大收入成長，並透過新產品推出和設計贏得更多份額。

Lastly, we end the year with a stronger balance sheet, reducing debt by $36 million, generating $125 million in net cash from operations, and returned approximately 15% of that to our shareholder through the stock buyback. We maintained CapEx at approximately 6% of the revenue, which is at the low end of our 5% to 9% model. We are continuing to make solid progress on process development at our 8-inch fab in Shanghai. Which we expect to complete by the end of the first quarter 2017.

最後，我們在年底實現了更強勁的資產負債表，減少了 3,600 萬美元的債務，從營運中產生了 1.25 億美元的淨現金，並透過股票回購將其中約 15% 返還給我們的股東。我們將資本支出維持在收入的 6% 左右，這是我們 5% 至 9% 模型的低端。我們在上海的 8 吋晶圓廠的製程開發方面繼續取得紮實進展。我們預計在 2017 年第一季末完成。

Our collective achievements throughout the year position the Company for continued growth, market share gains and margin expansion, as we intend to reach our goal of $1 billion in annual revenue. Before turning the call over to Rick, let me provide an update on our Lee's Summit wafer fab, known as KFAB. As previously announced, Diodes experienced a fire on November 18, 2016, in the wet etch wafer fabrication area, resulting in a temporary suspension of production. The cleanup and the repair costs, coupling with the fab idling capacity expense in fourth quarter, were approximately $7.5 million before tax, which was partially offset by an initial $1.5 million insurance payment.

我們全年的集體成就使公司能夠持續成長、擴大市場份額並擴大利潤，因為我們打算實現年收入 10 億美元的目標。在將電話轉給 Rick 之前，讓我先介紹一下我們的 Lee's Summit 晶圓廠（即 KFAB）的最新情況。如同先前所宣布的，Diodes 於 2016 年 11 月 18 日在濕蝕刻晶圓製造區域發生火災，導致生產暫時停止。清理和維修成本，加上第四季晶圓廠閒置產能費用，稅前約為 750 萬美元，部分被最初的 150 萬美元保險付款所抵銷。

We received the necessary approval on January 20, and after two qualification, normal production resumed on January 23, 2017. We are working diligently to recover those output so that we can fully support our customers' requirement in a timely manner. I'm also announce today that, after 23 years, the KFAB facility lease is not going to be renewed by the landlord at the end of the lease. As a result, we have begun activities to transfer the wafer manufacturing operation to other internal wafer fabs and external foundries.

我們於1月20日獲得了必要的批准，並經過兩次資格審查，於2017年1月23日恢復正常生產。我們正在努力恢復這些產量，以便我們能夠及時全面支持客戶的需求。我今天也宣布，23 年過去了，KFAB 設施的租約期滿後，房東將不再續約。因此，我們已經開始將晶圓製造業務轉移到其他內部晶圓廠和外部代工廠。

We expect to cease operation in this third quarter 2017 and to vacate the premise no later than November 15, 2017. Employees will be offered retention and the standard severance package. Setup costs are expected to be approximately $10 million to $12 million, which will be incurred throughout the remaining of 2017. Because of low cost and improved utilization of our internal wafer fabs, we expect our annual savings to be $11 million to $13 million once the equivalent volume has been fully transferred to other production sites. Additional detail in the KFAB closures are included in our earning press release issued earlier today.

我們預計將在 2017 年第三季停止運營，並在 2017 年 11 月 15 日之前搬出辦公室。我們將向員工提供保留和標準遣散費。設置成本預計約為 1000 萬至 1200 萬美元，將在 2017 年剩餘時間內產生。由於我們內部晶圓廠的低成本和利用率的提高，我們預計一旦同等數量已全部轉移至其他生產基地。 KFAB 關閉的更多細節包含在我們今天早些時候發布的盈利新聞稿中。

With that, I now turn the call over to Rick to discuss our fourth quarter financial results, as well as first quarter guidance, in more detail.

現在，我將電話轉給里克，更詳細地討論我們第四季的財務表現以及第一季的指導。

Thanks, Dr. Lu, and good afternoon, everyone. Revenue for the fourth quarter 2016 was $232.1 million compared to $250.7 million in the third quarter 2016 and $214.4 million in the fourth quarter 2015. Revenue for the quarter was down 7.4% sequentially due primarily to the KFAB fire combined with typical seasonality. For the full-year 2016, revenue was a record $942.2 million, an increase of 11% over $848.9 million in 2015.

謝謝盧博士，大家下午好。 2016 年第四季的營收為2.321 億美元，而2016 年第三季的營收為2.507 億美元，2015 年第四季的營收為2.144 億美元。該季的營收季減7.4%，主要是因為KFAB火災和典型的季節性因素。 2016 年全年營收達到創紀錄的 9.422 億美元，比 2015 年的 8.489 億美元成長 11%。

GAAP gross profit for the fourth quarter 2016 was $67.3 million, including approximately $5.3 million of fab expenses associated with the KFAB fire, or 29% of revenue, compared to the third quarter 2016 GAAP gross profit of $80.6 million, or 32.2% of revenue, and the fourth quarter 2015 GAAP gross profit of $53.6 million, or 25% of revenue. The sequential decrease in gross profit margin was due primarily to the decline in revenue and the impact on utilization from the KFAB fire. For the full year, GAAP gross profit was a record $286.9 million, or 30.5% of revenue, as compared to $248.6 million, or 29.3% of revenue, in the prior year.

2016 年第四季GAAP 毛利為6,730 萬美元，包括與KFAB 火災相關的約530 萬美元晶圓廠費用，佔營收的29%，而2016 年第三季GAAP 毛利為8,060 萬美元，佔收入的 32.2%。2015 年第四季 GAAP 毛利為 5,360 萬美元，佔營收的 25%。毛利率環比下降主要是由於收入下降以及 KFAB 火災對利用率的影響。全年 GAAP 毛利達到創紀錄的 2.869 億美元，佔營收的 30.5%，而前一年為 2.486 億美元，佔營收的 29.3%。

GAAP operating expenses for the fourth quarter 2016 were $61.9 million, or 26.7% of revenue, compared to $60.7 million, or 24.2% of revenue, in the third quarter of 2016 and $60.4 million, or 28.2% of revenue, in the fourth quarter 2015. Looking specifically at selling, general, and administrative expenses for the quarter, SG&A was approximately $39.1 million for the fourth quarter, or 16.8% of revenue, compared to $38.3 million, or 15.3% of revenue, in the third quarter 2016 and $41 million, or 19.1% of revenue, for the fourth quarter 2015. Investment in research and development for the fourth quarter was approximately $17.7 million, or 7.6% of revenue, compared to $17.1 million, or 6.8% of revenue, last quarter and $16.4 million, or 7.6% of revenue, in the fourth quarter 2015.

2016 年第四季的GAAP 營運費用為6,190 萬美元，佔營收的26.7%，而2016 年第三季為6,070 萬美元，佔營收的24.2%，2015 年第四季為6,040 萬美元，佔營收的28.2%具體來看本季的銷售、一般及管理費用，第四季的銷售、一般及管理費用約為3,910 萬美元，佔營收的16.8%，而2016 年第三季的SG&A 約為3,830 萬美元，佔營收的15.3%，佔營收的4,100 萬美元。2015 年第四季的研發投資約為1,770 萬美元，佔營收的19.1%。第四季的研發投資約為1,770 萬美元，佔營收的 7.6 %，而上一季的研發投資為1,710 萬美元，佔營收的 6.8%，上季為1,640 萬美元。2015 年第四季，佔營收的 7.6%。

Combined, SG&A plus R&D was $56.8 million, or 24.5% of revenue, compared to $55.4 million, or 22.1% of revenue, in the third quarter of 2016 and $57.4 million, or 26.7% of revenue, in the fourth quarter 2015. For the full-year, SG&A plus R&D was 24.2% of revenue. Total other expense amounted to approximately $2.7 million for the quarter, including a $3.2 million nonoperating investment impairment charge due to the Beamreach Solar bankruptcy. Income before taxes and noncontrolling interest in the fourth quarter 2016 amounted to $2.6 million compared to income of $15.6 million in the third quarter 2016 and a loss of $6.9 million in the fourth quarter 2015.

SG&A 加上研發費用合計為 5,680 萬美元，佔營收的 24.5%，而 2016 年第三季為 5,540 萬美元，佔營收的 22.1%，2015 年第四季為 5,740 萬美元，佔營收的 26.7%。全年，SG&A 加上研發佔營收的24.2%。本季其他費用總額約為 270 萬美元，其中包括因 Beamreach Solar 破產而產生的 320 萬美元非營運投資減損費用。 2016 年第四季稅前和非控股權益前收入為 260 萬美元，而 2016 年第三季收入為 1,560 萬美元，2015 年第四季虧損 690 萬美元。

Turning to income taxes, our effective income tax rate for the fourth quarter and full-year 2016 was approximately 23.3% and 26.2%, respectively. GAAP net income for the fourth quarter 2016 was $1.3 million or $0.3 per diluted share, including approximately $4 million or $0.08 per diluted share negative impact due to the KFAB fire and $2.1 million or $0.04 per diluted share negative impact due to the impairment charge. This compared to third quarter 2016 of $10.6 million or $0.21 per diluted share and fourth quarter 2015 loss of $4.8 million or $0.10 loss per share.

說到所得稅，我們2016年第四季和全年的有效所得稅率分別約為23.3%和26.2%。 2016 年第四季的GAAP 淨利為130 萬美元或稀釋每股0.3 美元，其中包括因KFAB 火災而產生的約400 萬美元或稀釋每股0.08 美元的負面影響，以及因減損費用而產生的210 萬美元或稀釋每股0.04 美元的負面影響。相較之下，2016 年第三季虧損 1,060 萬美元，即每股攤薄虧損 0.21 美元，2015 年第四季虧損 480 萬美元，即每股虧損 0.10 美元。

The share count used to compute GAAP diluted EPS for the fourth quarter 2016 was 50 million shares. GAAP net income for the full-year was $15.9 million or $0.32 per diluted share compared to $24.3 million or $0.49 per diluted share in 2015. 2016 represented our 26th consecutive year of profitability. Fourth quarter 2016 non-GAAP adjusted net income was $7.7 million or $0.15 per diluted share, which excluded, net of tax, $4.1 million of non-cash acquisition related asset amortization costs. This compares to non-GAAP adjusted net income of $15.1 million or $0.30 per diluted share in the third quarter 2016 and $6.7 million or $0.14 per diluted share in the fourth quarter 2015.

用於計算 2016 年第四季 GAAP 攤薄每股盈餘的股票數量為 5,000 萬股。全年 GAAP 淨利潤為 1590 萬美元，即稀釋後每股收益 0.32 美元，而 2015 年為 2430 萬美元，即稀釋後每股收益 0.49 美元。2016 年是我們連續 26 年盈利。 2016 年第四季非 GAAP 調整後淨利為 770 萬美元，即稀釋後每股收益 0.15 美元，不包括稅後 410 萬美元的非現金收購相關資產攤銷成本。相較之下，2016 年第三季非GAAP 調整後淨利為1,510 萬美元，即稀釋後每股收益0.30 美元，2015 年第四季調整後淨利為670 萬美元，即稀釋後每股收益0.14 美元。

Non-GAAP net income for the year was $38.4 million or $0.77 per diluted share. That compares to $42.3 million or $0.86 per diluted share in 2015. We've included in our earnings release a reconciliation of GAAP net income to non-GAAP net income which provides additional details. Included in the fourth quarter and full year 2016 GAAP net income and non-GAAP adjusted net income was approximately $800,000 and $9.1 million, respectively, net of tax, non-cash share-based compensation expense. Excluding share-based compensation expense, both GAAP EPS and non-GAAP adjusted diluted EPS would've increased by an additional $0.02 per diluted share in the fourth quarter and $0.18 per diluted share for the full year.

本年度非 GAAP 淨利為 3,840 萬美元，或稀釋後每股收益 0.77 美元。相比之下，2015 年為 4,230 萬美元，即稀釋後每股收益 0.86 美元。我們在收益報告中納入了 GAAP 淨利潤與非 GAAP 淨利潤的調節表，其中提供了更多詳細資訊。 2016 年第四季和全年的 GAAP 淨利潤和非 GAAP 調整後淨利潤分別約為 80 萬美元和 910 萬美元，扣除稅費和非現金股份補償費用。不包括基於股票的補償費用，第四季度的 GAAP 每股收益和非 GAAP 調整後的稀釋每股收益將額外增加 0.02 美元，全年稀釋每股收益將增加 0.18 美元。

Cash flow generated from operations was $49.8 million for the fourth quarter and $124.7 million for the full year 2016. Free cash flow was $38.3 million for the fourth quarter, which included $11.5 million of capital expenditures and free cash flow for the full-year was $66.2 million, which included approximately $58.5 million of CapEx. Net cash flow for the quarter was a positive $27.3 million, including the $18 million share repurchase. Net cash flow for 2016 was $29.4 million, which includes the pay down of approximately $36 million of long-term debt and the share repurchase.

第四季營運產生的現金流為4,980 萬美元，2016 年全年自由現金流為1.247 億美元。第四季自由現金流為3,830 萬美元，其中包括1,150 萬美元的資本支出，全年自由現金流為66.2 美元百萬美元，其中包括約 5,850 萬美元的資本支出。該季度的淨現金流為正 2,730 萬美元，其中包括 1,800 萬美元的股票回購。 2016 年淨現金流量為 2,940 萬美元，其中包括償還約 3,600 萬美元的長期債務和股票回購。

Turning to the balance sheet. At the end of the fourth quarter, cash and cash equivalents totaled approximately $248 million and short-term investments totaled $30 million. Working capital was approximately $547 million. At the end of the fourth quarter, inventory decreased by approximately $10.8 million from the end of the third quarter 2016 to approximately $193 million. The decrease in inventory reflects decreases in finished goods by $5.6 million and raw materials by $5.2 million, with work in process essentially flat. Inventory days were 111 in the quarter compared to 112 days last quarter. At the end of the fourth quarter, accounts receivables were approximately $217 million, a decrease of $22 million from the third quarter. AR days were 90 compared to 86 last quarter.

轉向資產負債表。截至第四季末，現金及現金等價物總額約為2.48億美元，短期投資總額為3,000萬美元。營運資金約 5.47 億美元。截至第四季末，庫存較2016年第三季末減少約1,080萬美元，至約1.93億美元。庫存的減少反映出製成品減少了 560 萬美元，原材料減少了 520 萬美元，而在製品則基本持平。本季庫存天數為 111 天，而上季為 112 天。第四季末，應收帳款約2.17億美元，較第三季減少2,200萬美元。 AR 天數為 90 天，而上季為 86 天。

Our long-term debt, net of the current portion, totaled approximately $413 million. Capital expenditures for the fourth quarter were $11.5 million or 5% of revenue. On a cash basis, capital expenditures for the full year totaled $58.5 million or 6.2% of revenue and was at the low end of our 5% to 9% of revenue model. Depreciation and amortization expense for the fourth quarter was $24.2 million and $99 million for the year.

扣除目前部分後，我們的長期債務總計約為 4.13 億美元。第四季的資本支出為 1,150 萬美元，佔收入的 5%。以現金計算，全年資本支出總計 5,850 萬美元，佔收入的 6.2%，位於我們 5% 至 9% 收入模式的低端。第四季折舊和攤提費用為 2,420 萬美元，全年折舊和攤提費用為 9,900 萬美元。

Now, turning to our outlook. For the first quarter of 2017, we expect revenue to range between $220 million and $240 million, or down 5.2% to up 3.4% sequentially. Reflecting typical seasonality as well as a one-month impact from the KFAB fire. We expect gross margin to be 28.5%, plus or minus 1%. Non-GAAP operating expenses -- which are GAAP operating expenses adjusted for retention costs, amortization of acquisition related intangible assets -- are expected to be approximately 25% of revenue, plus or minus 1%. We expect other expense to be approximately $4.3 million, which includes $1.5 million of KFAB cleanup and repair cost.

現在，轉向我們的展望。我們預計 2017 年第一季的營收將在 2.2 億美元至 2.4 億美元之間，即季減 5.2% 至成長 3.4%。反映了典型的季節性以及 KFAB 火災的一個月影響。我們預期毛利率為 28.5%，上下浮動 1%。非 GAAP 營運費用（根據保留成本、收購相關無形資產攤銷調整後的 GAAP 營運費用）預計約為收入的 25%，上下浮動 1%。我們預計其他費用約為 430 萬美元，其中包括 150 萬美元的 KFAB 清理和維修費用。

Our income tax rate is expected to be 29%, plus or minus 3%. And shares used to calculate diluted EPS for the first quarter are anticipated to be approximately 50.4 million. Please note that the purchase accounting adjustments for Pericom and previous acquisitions of $4.2 million after-tax are not included in these non-GAAP estimates. As previously mentioned, Diodes' KFAB facility will cease operations in late third quarter 2017 with production moved to other Diodes' wafer fabs and external foundries, and the premises vacated by November 15, 2017. The pretax closure costs are expected to be $10 million to $12 million in 2017 with approximately $1.1 million in the first quarter 2017. These shutdown costs have not been included in the above estimates.

我們的所得稅稅率預計為29%，正負3%。用於計算第一季攤薄每股收益的股票預計約為5,040萬股。請注意，Pericom 的收購會計調整和先前 420 萬美元的稅後收購不包含在這些非 GAAP 估計中。如前所述，Diodes 的KFAB 工廠將於2017 年第三季末停止運營，生產轉移至Diodes 的其他晶圓廠和外部代工廠，並於2017 年11 月15 日騰出廠房。稅前關閉成本預計為1,000 萬美元。2017 年 1,200 萬美元，2017 年第一季約為 110 萬美元。這些停工成本並未包含在上述估計中。

With that said, I will now turn the call over to Mark King.

話雖如此，我現在將把電話轉給馬克金。

Thank you, Rick, and good afternoon. As Rick and Dr. Lu mentioned, 2016 was a record year for revenue and gross profit, including a breakout year for our automotive strategy reaching 7% of revenue and growing almost 50% year-over-year. Looking at the fourth quarter specifically, revenue was down 7.4% sequentially due to typical seasonality compounded by the fire at KFAB. OEM sales were down 4.9% while distributor POP was down 8.6%. We conserved Diodes' finished goods inventory to support future customer orders due to the fire. Distributor inventory in the quarter decreased 4.2% due to normal reductions, while POS was flat.

謝謝你，瑞克，下午好。正如Rick和陸博士所提到的，2016年是收入和毛利創紀錄的一年，其中汽車策略實現突破，佔收入的比例達到7%，同比增長近50%。具體來看第四季度，由於典型的季節性因素以及 KFAB 的火災，收入環比下降了 7.4%。 OEM 銷售額下降 4.9%，經銷商 POP 銷售額下降 8.6%。由於火災，我們保留了 Diodes 的成品庫存，以支援未來的客戶訂單。由於正常減少，本季經銷商庫存下降 4.2%，而 POS 持平。

Throughout the fourth quarter, customer activity remained strong across all regions with solid design activity and design wins. With the Pericom integration largely complete, we are well-positioned to drive long-term growth with an expanded sales footprint and broadened product line.

整個第四季度，所有地區的客戶活動依然強勁，設計活動和設計成果都十分強勁。隨著 Pericom 整合基本完成，我們已做好充分準備，透過擴大銷售範圍和拓寬產品線來推動長期成長。

Turning to global sales, Asia represented 83% of revenue, Europe 9%, and North America 8%. In terms of our end markets, consumer represented 29% of revenue, communications 24%, industrial 20%, computing 20%, and automotive was a record 7% of revenue. Let me now provide more detail within each of our end markets.

就全球銷售額而言，亞洲佔收入的 83%，歐洲佔 9%，北美佔 8%。就我們的終端市場而言，消費者佔收入的 29％，通訊佔 24％，工業佔 20％，計算佔 20％，汽車佔收入的創紀錄的 7％。現在讓我提供我們每個終端市場的更多細節。

For the consumer market, we released a new quasi-resonant PWM controller with multiple operating modes to maximize power efficiency across a range of load conditions. These devices target AC to DC adapters for set-top box and gaming console applications. Also in the portable consumer space, our PCIe Gen 2 packet switch is ramping up in a Wi-Fi speaker application, and we have seen increasing contribution from our 4 watt Class D amplifiers for Bluetooth speaker applications, including a major win from a leading smartphone and consumer electronics manufacturer.

針對消費市場，我們發布了一款具有多種工作模式的新型準諧振 PWM 控制器，可在各種負載條件下最大限度地提高電源效率。這些裝置針對機上盒和遊戲機所應用的交流電轉直流轉接器。同樣在便攜式消費領域，我們的PCIe Gen 2 數據包交換機在Wi-Fi 揚聲器應用中的應用不斷增加，我們已經看到我們的4 瓦D 類放大器對藍牙揚聲器應用的貢獻不斷增加，其中包括領先智能手機的重大勝利和消費性電子產品製造商。

In the set-top box market specifically, we are seeing new market trends for increasing functionality to track usage patterns and strengthen protection against unauthorized content downloads. This represents a significant, high-volume opportunity for our crystal oscillator line acquired from Pericom, and we are in the process of being included on a major Chinese set-top box reference design platform.

特別是在機上盒市場，我們看到了新的市場趨勢，即增加追蹤使用模式的功能並加強對未經授權的內容下載的保護。這對我們從 Pericom 收購的晶體振盪器產品線來說是一個重要的大批量機會，而且我們正在被納入中國主要的機上盒參考設計平台。

In the mobile communications market, including portable device charging, Diodes developed and released 3.3 volt and 5 volt TVS devices in close collaboration with leading mobile communications customers which feature industry-leading performance. We secured an immediate design-in for a next-generation mobile phone from a major Asian manufacturer. Diodes also launched three more 100 volt and 120 volt devices from our new cost performance optimized Trench Schottky platform, which is designed to improve efficiency of budget chargers and adapters using conventional architectures.

在包括便攜式設備充電在內的行動通訊市場，Diodes 與領先的行動通訊客戶密切合作，開發並發布了 3.3 伏特和 5 伏特 TVS 裝置，這些裝置具有業界領先的性能。我們立即從一家亞洲主要製造商那裡獲得了下一代手機的設計。 Diodes 還透過我們新的成本性能優化 Trench 肖特基平台推出了另外三款 100 伏特和 120 伏特裝置，該平台旨在提高使用傳統架構的廉價充電器和適配器的效率。

In the computing market, we continue to see acceleration of USB Type C adoption across a broad range of computing and portal consumer applications. Our Type C USB Mux devices continue to ramp in several market-leading notebook and gaming controller applications, as did our sleep and charge port controller in notebook computing. Also for notebook applications we released a new USB signal multiplexer that enables switching across a wide range of signal types.

在運算市場中，我們繼續看到 USB Type C 在廣泛的運算和入口網站消費應用中的採用加速。我們的 Type C USB Mux 設備繼續在多個市場領先的筆記型電腦和遊戲控制器應用中普及，筆記型電腦中的睡眠和充電端口控制器也是如此。此外，針對筆記型電腦應用，我們也發布了一款新型 USB 訊號多工器，可實現多種訊號類型之間的切換。

For the industrial space, Diodes launched three new second-generation, high-voltage 600 volt half-bridge gate drivers for brushless DC motor drive applications. Also new for Q4 were two additional 100 volt MOSFET products to broaden our existing portfolio based on Diodes' Shielded Gate technology. Additionally, we released two new families of LED drivers, one targeted for industrial applications that operate from a higher input voltage, and a second family for dimmable LED lamp applications. This family of LED converters and controllers has met with strong early market adoption, securing five significant new design wins for LED retrofit bulb applications within the first months of production.

對於工業領域，Diodes 推出了三款新的第二代高壓 600 伏特半橋閘極驅動器，用於無刷直流馬達驅動應用。第四季的新產品還包括另外兩款 100 伏特 MOSFET 產品，以擴大我們基於 Diodes 屏蔽閘極技術的現有產品組合。此外，我們還發布了兩個新的 LED 驅動器系列，其中一個系列適用於在較高輸入電壓下工作的工業應用，第二個系列適用於可調光 LED 燈應用。此 LED 轉換器和控制器系列已獲得早期市場的廣泛採用，在生產的頭幾個月內就獲得了針對 LED 改裝燈泡應用的五項重大新設計勝利。

We also saw design win strength in security camera and surveillance market with major wins on an omnipolar Hall sensor, a primary side high-frequency controller, a four-port PCIe packet switch, and an active HDMI switch. Other notable industrial market wins generated from the metering and industrial control space. And finally in the automotive market it was another busy quarter. Our PCIe clock solutions in automotive audio applications continue to ramp while also generating increased activity for our Gen 2 packet switches from a broad range of major automotive module makers. We have been receiving strong confirmation on the value of our packet switches from the emerging market requirements for telematics, infotainment, and ADAS applications.

我們還看到了安全攝影機和監控市場的設計優勢，在全極霍爾感測器、初級側高頻控制器、四埠 PCIe 封包交換器和主動式 HDMI 交換器上取得了重大勝利。其他值得注意的工業市場勝利來自計量和工業控制領域。最後，汽車市場又迎來了繁忙的季度。我們在汽車音訊應用中的 PCIe 時鐘解決方案不斷發展，同時也為我們的第二代資料包交換器帶來了來自眾多主要汽車模組製造商的更多活動。遠端資訊處理、資訊娛樂和 ADAS 應用的新興市場需求已充分證實了我們的資料包交換器的價值。

We also launched a number of new products during the quarter from our MOSFET, bipolar transistor, TVS and SBR platforms. Diodes expanded our range of high temperature 175 degree capable MOSFETs with the addition of two new 60 volt devices in SO packaging for brushless DC motor and other auto applications. For the last four quarters now, MOSFETs from Diodes' innovative automotive qualified Shielded Gate process have continued to enhance our growing automotive product portfolio. MOSFET products from this family have accounted for a consistent stream of customer qualification activity and design-ins across our automotive customer base, which has contributed greatly to Diodes' revenue growth in this end market during 2016.

本季我們也透過 MOSFET、雙極電晶體、TVS 和 SBR 平台推出了許多新產品。 Diodes 增加了兩款採用 SO 封裝的新型 60 伏特元件，適用於無刷直流馬達和其他汽車應用，擴大了我們的耐高溫 175 度 MOSFET 的範圍。在過去的四個季度中，採用 Diodes 創新的汽車級屏蔽閘極製程製造的 MOSFET 不斷增強我們不斷成長的汽車產品組合。該系列的 MOSFET 產品在我們的汽車客戶群中獲得了持續的客戶資格活動和設計，這為 Diodes 2016 年在該終端市場的收入成長做出了巨大貢獻。

In summary, we had a solid year of record revenue, gross profit and growth in our automotive market. With our acquisition of Pericom, we are well positioned to capitalize on a number of cross-selling opportunities across our expanded product portfolio and global customer base. As we look to the coming year, we continue to focus on increased content and penetration of several large and growing markets such as automotive, wearables, Internet of Things, wireless and portable charging, as well as USB Type C connectors.

總而言之，我們今年的營收、毛利和汽車市場的成長均創歷史新高。透過收購 Pericom，我們能夠充分利用我們擴大的產品組合和全球客戶群中的大量交叉銷售機會。展望來年，我們將繼續關注汽車、穿戴式裝置、物聯網、無線和便攜式充電以及 USB Type C 連接器等幾個大型且不斷增長的市場的內容增加和滲透率。

With that, I'll open the floor to questions. Operator?

接下來，我將開始提問。操作員？

(Operator Instructions) Tristan Gerra, Baird.

（操作員說明）Tristan Gerra，Baird。

It looks like you've reduced pretty nicely channel inventories, if we look at your POP versus the point-of-sales. How much of that was due to the Kansas City production disruption? And if so, would you try to rebuild inventories as production comes back in line later in Q1 and Q2?

如果我們看看您的 POP 與銷售點，您似乎已經很好地減少了通路庫存。其中有多少是由於堪薩斯城的生產中斷造成的？如果是這樣，隨著第一季和第二季晚些時候生產恢復正常，您會嘗試重建庫存嗎？

I would say that 50% of that, or some percent of that -- I don't have it actually quantified to, but there was some percentage of it was due to the fire. And some of it was generally due to end of the year inventory reductions, but we had a little stronger POS than expected in Asia, so it's hard to really quantify all of it. Yes, we do expect to -- actually, we expect to see a little bit more inventory decrease in this month and through February and maybe start to be able to build again in March and beyond, but we still have some restocking that will be required from the FabTech incident.

我想說其中 50%，或者說其中的某個百分比——我沒有實際量化，但其中有一定百分比是由於火災造成的。其中一些通常是由於年底庫存減少所致，但我們在亞洲的銷售點比預期要強一些，因此很難真正量化所有這些。是的，我們確實預計——實際上，我們預計本月和整個二月份庫存會減少一點，也許在三月及以後能夠再次增加庫存，但我們仍然需要補充一些庫存來自 FabTech 事件。

I think our FabTech priority will be supporting the customer on the sole-source product. And therefore, I'm putting the priority to support the customer demand and sort of build up the inventory in the channel, it will be second priority. And therefore, I probably don't expect that was done in 1Q. Maybe when we go into the second quarter we have enough capacity, then we'll do that. But right now, the priority for the KFAB is supporting customer demand for the sole-source product. At the same time, start building some inventory, prepare for the shutdown. Those would be the priorities.

我認為我們 FabTech 的首要任務是為客戶提供獨家產品支援。因此，我將優先考慮支援客戶需求並在通路中建立庫存，這將是第二優先事項。因此，我可能預計不會在第一季完成。也許當我們進入第二季時我們有足夠的產能，然後我們就會這樣做。但目前，KFAB 的首要任務是支援客戶對單一來源產品的需求。同時，開始建立一些庫存，為停產做好準備。這些將是優先事項。

Great, and then just a quick follow-up. So presumably your gross margin should benefit as you start rebuilding. And I'm assuming that it's more the Q2 type of trend, but any comment around that would be great. And then also, in terms of timings of when the savings begin, I'm assuming it's going to be 2018, first half of 2018.

太好了，然後就是快速跟進。因此，當您開始重建時，您的毛利率應該會受益。我假設這更像是第二季的趨勢，但對此的任何評論都會很棒。另外，就儲蓄開始的時間而言，我假設是 2018 年，也就是 2018 年上半年。

Well, let me answer your first question. Really the capacity utilization issue, other than in the KFAB, is our assembly site because KFAB cannot support enough wafers such that the assembly site production is really sold out. So when we're talking about utilization cost, it's really coming from both: coming from KFAB production and coming from assembly. So, that is what happened to the first quarter, because we basically lose one full month of the wafer output. But then, when we start to ramp it up and we gradually go back to the run rate before we have a fire. And when that happens, then the assembly capacity will be start to realize. And so, I would expect the second quarter -- we don't give a guidance yet, but I would expect the second quarter, our backend utilization to be back to normal.

好吧，讓我回答你的第一個問題。實際上，除 KFAB 之外，產能利用率問題是我們的組裝廠，因為 KFAB 無法支援足夠的晶圓，導致組裝廠的生產實際上已售罄。因此，當我們談論使用成本時，它實際上來自兩個方面：來自 KFAB 生產和來自組裝。所以，這就是第一季發生的情況，因為我們基本上損失了整整一個月的晶圓產量。但是，當我們開始提高速度時，我們會逐漸回到起火之前的運行速度。當這種情況發生時，組裝能力將開始實現。因此，我預計第二季度 - 我們尚未給出指導，但我預計第二季度我們的後端利用率將恢復正常。

And then to answer your second question -- okay, you were talking about when benefit would be start to come back. And we start to prepare the transfer the technology, the process, to house our SFAB. Now, the one transfer back to -- transfer to the OFAB. Some of our technology already existed in OFAB and then we transfer the product line to OFAB. Those should be they power this year after the qualification. It should recover those. But for us to develop the process in the SFAB, Shanghai fab, we would expect to gradually qualify some in the second quarter, end of second quarter; some will be end of third quarter, and that's our current schedule.

然後回答你的第二個問題 - 好吧，你正在談論福利何時開始恢復。我們開始準備轉移技術、流程，以安置我們的 SFAB。現在，我們將轉回 — 轉回 OFAB。我們的一些技術已經存在於OFAB，然後我們將產品線轉移到OFAB。這些應該是他們今年資格賽後的動力。它應該恢復那些。但對於我們在上海晶圓廠 SFAB 開發的製程來說，我們預計在第二季、第二季末逐步獲得一些資格；有些將在第三季末進行，這是我們目前的時間表。

And so I would expect -- but this year requirement will try to build inventory from the KFAB. Because it takes time for customers to approve the technology in the Shanghai fab. So I expect in the first quarter of next year, we will start to ramp in our SFAB for those products. And probably, depending on the customer approval time, I would expect probably second half of the next year to fully recover.

所以我預計 - 但今年的要求將嘗試從 KFAB 建立庫存。因為客戶認可上海晶圓廠的技術需要時間。因此，我預計明年第一季度，我們將開始增加這些產品的 SFAB。根據客戶批准時間，我預計明年下半年可能會完全恢復。

That's very useful. Thank you.

這非常有用。謝謝。

Steve Smigie, Raymond James.

史蒂夫·斯米吉，雷蒙德·詹姆斯。

This is Vince Celentano on for Steve. I wanted to follow-up on the KFAB shutdown. So should we expect in 2017 and 2018, of there to be maybe a decrease in OpEx in each year, given all the shutdowns as well as the severances?

我是文斯塞倫塔諾 (Vince Celentano) 替史蒂夫發言。我想跟進 KFAB 關閉的情況。那麼，考慮到所有的停工和遣散費，我們是否應該預期 2017 年和 2018 年每年的營運支出可能會下降？

Of OpEx?

營運支出？

Of OpEx, yes.

運營支出，是的。

Yes, I wouldn't think so, because most of the KFAB expense is in the cost of goods sold area. Some of it will transfer and be cut down a little bit because of the engineering and those level people, but most of their cost is in the overhead line.

是的，我不這麼認為，因為 KFAB 的大部分費用都在銷售成本部分。由於工程和這些級別的人員的原因，其中一些會轉移並被削減一點，但大部分成本都在架空線路中。

Okay, great. And have you seen any impacts yet from the ON-Fairchild acquisition as far as any particular industry looking now for a second source? Have you guys seen any -- well, any impact?

好的，太好了。您是否看到收購 ON-Fairchild 對任何正在尋找第二來源的特定行業產生了任何影響？你們有看過任何影響嗎？

I think we see these consolidations, whether it be ON and Fairchild or IR and Infineon, we see a lot of opportunity from all of those. As the vendor base shrinks, customers are looking for a new vendor to fill those positions, so we view those as both opportunistic situations for us.

我認為我們看到了這些整合，無論是 ON 和 Fairchild 還是 IR 和 Infineon，我們都從所有這些整合中看到了很多機會。隨著供應商基礎的縮小，客戶正在尋找新的供應商來填補這些職位，因此我們認為這對我們來說都是機會主義的情況。

Okay, great. And just one quick follow-up, if I can sneak one in. It looks like last quarter your share-based comp dropped down to about $1 million. Do you expect that to return to a more normalized level starting in the March quarter?

好的，太好了。如果我能偷偷地講一下，我只想快速跟進一下。看起來上個季度你們的基於股票的補償下降到了大約 100 萬美元。您預計從三月季度開始會恢復到更正常的水平嗎？

Yes, it will. That has to do with some changes we've made in the executive compensation. And we will -- when we do the proxy you will see that we have a new executive compensation which will put us back to a more normal situation.

是的，它會。這與我們對高階主管薪酬所做的一些改變有關。當我們進行代理時，您會看到我們有新的高階主管薪酬，這將使我們回到更正常的情況。

Okay, great. Thank you.

好的，太好了。謝謝。

(Operator Instructions) Shawn Harrison, Longbow Research.

（操作員說明）Shawn Harrison，長弓研究中心。

Rick, if I may, you went to the buyback this quarter. In preceding quarters it was focused in on debt reduction. How would you expect to deploy excess free cash in either in the first quarter or 2017?

里克，請容許我告訴您，您本季進行了回購。在前幾個季度，它的重點是減少債務。您預計如何在第一季或 2017 年部署多餘的自由現金？

First quarter of 2017, it's going to be debt reduction.

2017年第一季度，債務削減。

And then what's the decision-making process as you move throughout the year, between debt pay down versus buyback?

那麼，全年在償還債務和回購之間的決策過程是怎麼樣的呢？

Well, it really ends up being how much money we have available. A lot of our money is overseas and it's dependent upon the availability of getting that money to the US. And so, we have a methodology of paying off the debt by not bringing that money back directly to the US. So it's -- if the money is here, we can use it for stock buyback. If the money is overseas then we have to use it for debt repayment.

好吧，最終的結果就是我們有多少錢。我們的許多資金都在海外，這取決於能否將這些資金轉移到美國。因此，我們有一種透過不將資金直接帶回美國來償還債務的方法。所以，如果錢到位了，我們就可以用它來回購股票。如果錢在海外，我們就必須用它來償還債務。

Okay. And then as you bring the 8-inch capacity online -- maybe I missed this, I'm sorry -- but do costs ramp up as you bring that online exiting the first quarter, so there will be an incremental drag as you load that business? Or is the cost of ramping that already within the guidance here in the first quarter?

好的。然後，當你將8 英寸容量上線時——也許我錯過了這一點，我很抱歉——但是，當你在第一季度退出時將其上線時，成本會上升，所以當你加載它時，會出現增量阻力商業？或者說，增加成本是否已經在第一季的指導範圍內？

Okay. When I say qualify in the first quarter, we may not ramp it in the first quarter. What I'm saying, expect we build the technology by end of first quarter. Then we need to get the sample. We need to get PCN, and we probably won't start to ramp production right away. Now, if we had the loading, then it might a little bit hurt. But from when we started loading it, start to ramp it, after you fully ramp, it won't cause the problem. And we're slowly getting the capacity. The first chunk of the capacity is 3,000 wafers per month. It's not a big capacity. We just carefully develop the technology, develop the product, the PCN, get the customer to accept it.

好的。當我說第一季晉級時，我們可能不會在第一季提高它。我的意思是，預計我們會在第一季末開發出這項技術。然後我們需要取得樣本。我們需要獲得 PCN，但我們可能不會立即開始提高產量。現在，如果我們有負載，那麼可能會有點痛。但是從我們開始加載它開始，開始斜坡它，當你完全斜坡之後，它不會導致問題。我們正在慢慢獲得容量。第一部分產能是每月 3,000 片晶圓。這不是一個很大的容量。我們只是認真開發技術，開發產品，PCN，讓客戶接受。

Then when the production started and when you fully utilize that capacity, then we're going to expand that capacity to the next step. So, you won't see a major cost problem when we ramp up that capacity, that capability. For long-term, it's going to be good for us.

然後，當生產開始並且充分利用該產能時，我們將將該產能擴展到下一步。因此，當我們提高產能時，您不會看到重大的成本問題。從長遠來看，這對我們來說是有好處的。

Perfect. And then lastly, if I may, Mark, I believe you said Asia was a little stronger exiting the year than anticipated. Was that because of the early Chinese New Year, or are you seeing signs of true underlying demand accelerate in the signs you are seeing from distributors and customers?

完美的。最後，馬克，我相信你說過亞洲今年的表現比預期強。這是因為中國新年較早，還是您從分銷商和客戶的跡像中看到了真正的潛在需求加速的跡象？

Yes, we had a solid fourth quarter with POS in Asia as compared to the rest of the world. And signs are that, going into first quarter and beyond, that that business is relatively strong.

是的，與世界其他地區相比，我們第四季的 POS 在亞洲表現強勁。有跡象表明，進入第一季及以後，該業務相對強勁。

Yes. Actually, right after the Chinese New Year, since the recover -- our customers recover is quite strong. (multiple speakers) That's why when we give the guidance, we really look at, is KFAB -- actually today, our problem is a supply issue, not a demand issue. As I said, our big problem is the KFAB wafer support issue. And from business point of view, if we can get KFAB effective production back to normal support, we should -- it should be looking good.

是的。事實上，就在農曆新年之後，自從復甦以來，我們的客戶復甦就相當強勁。 （多名演講者）這就是為什麼當我們提供指導時，我們真正關注的是 KFAB——實際上今天，我們的問題是供應問題，而不是需求問題。正如我所說，我們的大問題是 KFAB 晶圓支援問題。從商業角度來看，如果我們能讓 KFAB 的有效生產恢復到正常支持，我們應該——看起來應該不錯。

Perfect. Thank you, Dr. Lu.

完美的。謝謝您，盧醫師。

Lena Zhang, Summit Redstone.

張莉娜，峰會紅石。

Regarding the KFAB transfer process, given that there are 5-inch and 6-inch facilities in the KFAB and their utilizations you provided on the September quarter, and it seems that only the Shanghai fab can take all of the products from the KFAB. So, if after you fully shut down the KFAB, would you please provide us some estimates for the percentage of the outsourcing?

關於KFAB轉移流程，鑑於KFAB內有5吋和6吋設備以及您在9月份季度提供的利用率，似乎只有上海晶圓廠可以從KFAB拿走所有產品。那麼，如果您完全關閉 KFAB 後，您能否向我們提供一些外包百分比的估計？

I don't think we have exactly those percentages now. But I think that the Chinese 6-inch fab is not the only opportunity. There is some movement around between multiple different products, some moving out of our OFAB facility into outsource on our SBR products, all bipolars. Really, the center of our bipolar technology is located in OFAB. So, the transistors will go there. We've had a very long relationship, for 20 years, with a Japanese supplier, and a lot of our products are already qualified in those locations. So, I don't think everything is required to go there, but it definitely will help our utilization in our SFAB facility going long-term.

我認為我們現在還沒有確切的百分比。但我認為中國6吋晶圓廠並不是唯一的機會。多種不同產品之間存在一些變化，一些產品從我們的 OFAB 工廠轉移到外包我們的 SBR 產品，所有產品都是雙極性的。事實上，我們雙極技術的中心位於 OFAB。所以，晶體管會去那裡。我們與一家日本供應商有著長達 20 年的長期合作關係，我們的許多產品已經在這些地區獲得了資格。因此，我認為不需要一切都去那裡，但這肯定有助於我們 SFAB 設施的長期利用。

And actually, we are going to transfer some of the product from our SFAB1 to the SFAB2 to clear some rooms to move the demand from -- to move the requirement from KFAB to SFAB1. So at the end, you're going to have both SFAB1, SFAB2, and including OFAB, that will all help the utilization. So that's why when we put it with -- after all these move was completed, we should see the benefit of $11 million to $13 million. That's because the utilization of all of our internal fab will be all helped.

實際上，我們將把一些產品從 SFAB1 轉移到 SFAB2，以騰出一些空間來轉移需求——將需求從 KFAB 轉移到 SFAB1。所以最後，您將擁有 SFAB1、SFAB2，並包括 OFAB，這都將有助於利用率。因此，這就是為什麼當我們將其放在所有這些舉措完成之後，我們應該會看到 1,100 萬至 1,300 萬美元的收益。那是因為我們所有內部晶圓廠的使用率都會得到幫助。

Thank you. And the next one is -- yes, you did mention cost saving after fully shut down the KFAB. But this cost savings included negative impact for the increasing of outsourcing?

謝謝。下一個是——是的，您確實提到了完全關閉 KFAB 後節省成本。但這種成本節省是否對外包的增加產生了負面影響？

I don't know.

我不知道。

Well, it includes the costs associated. So the way that analysis was done is we took the SFAB wafers and cost, the KFAB wafers and cost now. And then we said okay, what happens when the SFAB wafers go up? That we go to the outsourcing facility, and then we compared the cost after that. And that's the $3 million to $3.5 million a quarter that we put in there for -- I think we said $11 million to $13 million. So, that includes the cost of those outsourced wafers. But in the analysis, those outsourced wafers are not as significant as moving the product to SFAB1.

嗯，它包括相關的成本。因此，分析的方式是我們現在採用 SFAB 晶圓和成本、KFAB 晶圓和成本。然後我們說好吧，當 SFAB 晶圓上漲時會發生什麼？我們去了外包工廠，然後我們比較了成本。這就是我們每季投入的 300 萬至 350 萬美元——我想我們說的是 1,100 萬至 1,300 萬美元。因此，這包括那些外包晶圓的成本。但在分析中，那些外包晶圓並不像將產品轉移到SFAB1那麼重要。

I see. But also, if I remember correctly, last quarter earnings call you mentioned the utilization rate of 85% is considered as fully utilized, right?

我懂了。而且，如果我沒記錯的話，上個季度的財報電話會議上您提到 85% 的利用率被視為已充分利用，對吧？

Okay. Lena, let me correct some of the things. In the beginning of last year, or 2015, SFAB capacity is much bigger. And because when we -- at that time, when we see the demand is not there, we actually cut the capacity. We return the fourth floor and move out some of the equipment, reduce the capacity almost one third to improve the utilization. Then, when we see we are going to -- we're going to reduce the deals, we have a difficulty to renew. We actually go back to asking to take the fourth floor, that space back. And therefore, now we have enough space.

好的。莉娜，讓我糾正一些事情。去年年初，也就是2015年，SFAB的產能就大得多。因為當我們看到需求不存在時，我們實際上削減了產能。我們返回四樓，搬出了一些設備，減少了近三分之一的容量，以提高利用率。然後，當我們看到我們將要減少交易時，我們就很難續約。我們實際上又回到了要求收回四樓的那個空間。因此，現在我們有足夠的空間。

And after KFAB is shut down, we'll move some of the KFAB equipment into the SFAB. Therefore, when we took inventory in the third quarter, that utilization, that capacity will be different from the capacity at the end we're going to have, because we will have more space and we will move the equipment from KFAB to SFAB.

KFAB 關閉後，我們會將部分 KFAB 裝置移至 SFAB。因此，當我們在第三季盤點庫存時，利用率、產能將與我們最終擁有的產能不同，因為我們將擁有更多空間，並且我們將設備從 KFAB 轉移到 SFAB。

Thank you. That's very helpful. Thanks. That's all I had.

謝謝。這非常有幫助。謝謝。這就是我所擁有的一切。

Thank you. I'm seeing no other questioners in the queue at this time, so I'd like to turn the call back over to management for closing remarks.

謝謝。目前我在隊列中沒有看到其他提問者，因此我想將電話轉回管理層以進行結束語。

Thank you for your participation today. Operator, you may now disconnect.

感謝您今天的參與。接線員，您現在可以斷開連接了。

Ladies and gentlemen, I'd like to take the time to thank everyone again for your participation in today's conference. This now concludes the program and you may now disconnect your phone lines at this time. Everyone, have a great day.

女士們、先生們，我要再次感謝大家參加今天的會議。現在程式結束，您現在可以斷開電話線。大家，祝你有美好的一天。