Diodes Inc (DIOD) 2023 Q4 法說會逐字稿

Good afternoon and welcome to Diodes Incorporated Fourth Quarter and Fiscal 2023 Financial Results Conference Call. (Operator Instructions)

下午好，歡迎參加 Diodes 公司第四季和 2023 財年財務業績電話會議。 （操作員說明）

At the conclusion of today's conference call, instructions will be given for the question-and-answer session. (Operator Instructions)

在今天的電話會議結束時，將對問答環節做出指示。 （操作員說明）

As a reminder, this conference call is being recorded today, Tuesday. February 6, 2024.

提醒一下，本次電話會議是在今天星期二錄製的。 2024 年 2 月 6 日。

I would now like to turn the call over to Leanne Sievers of Shelton Group, Investor Relations. Leanne, please go ahead.

我現在想將電話轉給謝爾頓集團投資者關係部的 Leanne Sievers。莉安，請繼續。

Good afternoon and welcome to Diodes' fourth quarter and fiscal 2023 financial results conference call.

下午好，歡迎參加 Diodes 第四季和 2023 財年財務業績電話會議。

I'm Leanne Sievers, President of Shelton Group, Diodes' Investor Relations firm.

我是 Leanne Sievers，Diodes 投資人關係公司 Shelton Group 的總裁。

Joining us today are Diodes' President, Gary Yu; Chief Financial Officer, Brett Whitmire; Senior Vice President of Worldwide Sales and Marketing; Emily Yang; and Director of Investor Relations, Gurmeet Dhaliwal.

今天加入我們的是 Diodes 總裁 Gary Yu；財務長布雷特·惠特米爾；全球銷售與行銷資深副總裁；艾米莉楊；和投資者關係總監 Gurmeet Dhaliwal。

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 customary quarterly reviews by the company's independent registered public accounting firm. As such, these results are unaudited and subject to revision until the company files its Form 10-K for its fiscal year ending December 31, 2023. In addition, management's prepared remarks contain forward-looking statements, which are subject to risks 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 including Forms 10-K and 10-Q.

我想提醒我們的聽眾，今天公佈的結果是初步的，因為這些結果取決於公司最終確定的結帳程序以及公司獨立註冊公共會計師事務所的慣例季度審查。因此，這些結果未經審計，並可能進行修訂，直到公司提交截至2023 年12 月31 日的財政年度的10-K 表格。不確定性的影響管理層可能會做出額外的前瞻性陳述來回答您的問題。因此，該公司聲稱受到 1995 年《私人證券訴訟改革法案》中包含的前瞻性陳述安全港的保護。因此，我們建議您參閱本公司向美國證券交易委員會提交的文件（包括表格 10-K 和 10-Q）中有關風險和不確定性的更詳細討論。

In addition, any projections as to the company's future performance represent management's estimates as of today, February 6, 2024. Diodes assumes no obligation to update these projections in the future as market conditions may or may not change except to the extent required by applicable law.

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（2024 年2 月6 日）的估計。法律要求的範圍內。

Additionally, the company's press release and management 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 statements during the conference call, we refer to the net income attributable to common stockholders as GAAP net income.

此外，該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，在公司的新聞稿和電話會議期間的管理層聲明中，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 90 days in the Investor Relations section of Diodes' website at www.diodes.com.

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 的投資者關係部分透過網路廣播提供為期 90 天的錄音。

And now, I'll turn the call over to Diodes' President, Gary Yu. Gary, please go ahead.

現在，我將把電話轉給 Diodes 總裁 Gary Yu。加里，請繼續。

Thank you, Leanne.

謝謝你，莉安。

Welcome, everyone to our result conference call.

歡迎大家參加我們的結果電話會議。

I'm pleased to be joining you today as Diodes' recently appointed President effective January 2. As announced at the end of last year, my promotion was part of Diodes' multi-year CEO succession plan. Dr. Lu will continue to serve as Chairman and the CEO until at least May 31, 2027, which is consistent with current employment agreement. As many of you may know, I have previous served as Diodes' Chief Operating Officer, and have been with Diodes since 2008. I'm very excited to be serving in this new role and then leading Diodes into the next stage of growth, which will focus on developing a broad portfolio of innovative products to enable customer success in the markets we serve.

我很高興今天加入你們，擔任 Diodes 最近任命的總裁，任命於 1 月 2 日生效。 正如去年底宣布的那樣，我的晉升是 Diodes 多年首席執行官繼任計劃的一部分。陸博士將繼續擔任董事長兼首席執行官，任期至少到2027年5月31日，這與目前的僱傭協議一致。你們很多人可能都知道，我曾擔任 Diodes 的首席營運官，自 2008 年以來一直在 Diodes 工作。產品組合，以幫助客戶在我們所服務的市場中取得成功。

In terms of our 2023 result, this past year proved to be a challenging as the consumer, computing, and the communications market experienced an extended slowdown, coupled with inventory rebalancing in the industrial market late in the year, as well as softness in certain area of automotive market. Despite this global weakness, we made notable progress on improving the quality and mix of our product portfolio. We continue to focus on automotive and industrial markets through expanding design wins and increased investments in new product development, which resulted in over 350 new automotive-compliant products.

就我們 2023 年的業績而言，過去的一年是充滿挑戰的一年，因為消費、計算和通訊市場經歷了長期放緩，加上年底工業市場的庫存重新平衡，以及某些領域的疲軟的汽車市場。儘管存在全球疲軟，但我們在提高產品組合的品質和組合方面取得了顯著進展。我們透過擴大設計成果和增加新產品開發投資，繼續專注於汽車和工業市場，從而推出了 350 多種符合汽車標準的新產品。

The combined revenue from those 2 markets expanded to 46% of product revenue in 2023 compared to 42% last year. Our product mix improvements were especially evident in our ability to maintain full-year gross margin near 40%, meeting our target model despite the lower annual revenue. Throughout the year, we continued to drive manufacturing cost reductions, operating efficiency, while also further developing our process technology for expansion of our internal facility utilization. Overall, we maintained strong cash generation in 2023 that enabled us to reduce total debt by $124 million to $62 million, maintain a solid cash position over $315 million and increase total cash less debt by 67% to approximately $253 million. Additionally, we renewed and expanded our line of credit to approximately $315 million to provide added financial flexibility.

到 2023 年，這兩個市場的總收入佔產品收入的比例將從去年的 42% 增加到 46%。我們的產品組合改進尤其明顯，我們能夠將全年毛利率維持在 40% 左右，儘管年收入較低，但仍達到了我們的目標模型。全年，我們持續推動製造成本降低、營運效率提高，同時進一步開發製程技術以擴大內部設施利用率。總體而言，我們在2023 年保持了強勁的現金產生能力，使我們能夠將總債務減少1.24 億美元，達到6200 萬美元，保持超過3.15 億美元的穩健現金狀況，並將現金減去債務總額增加67%，達到約2.53 億美元。此外，我們更新了信貸額度並將其擴大到約 3.15 億美元，以提供更大的財務靈活性。

As we look to 2024, we remain focused on driving further improvements in the quality and the mix of our portfolio with our analog and our power discrete products, including our newly introduced SiC product family, especially targeted at the automotive and industrial markets. We also continue to make a good progress, ramping our previously acquired fab, SPFAB and our GFAB in terms of our process and our product

展望 2024 年，我們仍然專注於推動產品組合與類比和功率分立產品的品質和組合的進一步改進，包括我們新推出的 SiC 產品系列，特別針對汽車和工業市場。我們也持續取得良好進展，在製程和產品方面提升我們先前收購的晶圓廠、SPFAB 和 GFAB

qualifications, which will support future utilization and that further complements our hybrid manufacturing model.

資格，這將支持未來的利用，並進一步補充我們的混合製造模式。

We believe our total solution sales approach that has been successful in the past, along with a further emphasis placed on key account development will continue to deliver increasing content opportunity, design wins, and a profitable growth in the future.

我們相信，我們過去成功的整體解決方案銷售方法，以及對大客戶開發的進一步重視，將繼續帶來更多的內容機會、設計勝利和未來的獲利成長。

With that, let me now turn the call over to Brett to discuss our fourth quarter and the full-year financial results as well as our first quarter guidance in more detail.

現在，讓我將電話轉給布雷特，更詳細地討論我們的第四季度和全年財務業績以及第一季的指導。

Thanks, Gary. And good afternoon, everyone.

謝謝，加里。大家下午好。

Revenue for the fourth quarter of 2023 was $322.7 million compared to $404.6 million in the third quarter 2023 and $496.2 million in the fourth quarter 2022. Full-year 2023 revenue was $1.7 billion compared to $2 billion in 2022.

2023 年第四季的營收為3.227 億美元，而2023 年第三季的營收為4.046 億美元，2022 年第四季的營收為4.962 億美元。為20 億美元。

Gross profit for the fourth quarter was $112.5 million or 34.9% of revenue, which reflects the lower revenue impacted by product mix as well as our wafer service agreements. This compares to $155.9 million or 38.5% of revenue in the prior quarter and $206.2 million or 41.6% of revenue in the prior year quarter. For the full-year, GAAP gross profit was $658.2 million and GAAP gross margin was 39.6% effectively at our target model of 40%.

第四季的毛利為 1.125 億美元，佔營收的 34.9%，反映出產品組合和晶圓服務協議影響的收入下降。相較之下，上一季營收為 1.559 億美元，佔營收的 38.5%；上一季營收為 2.062 億美元，佔營收的 41.6%。全年 GAAP 毛利為 6.582 億美元，以我們 40% 的目標模型計算，GAAP 毛利率有效為 39.6%。

GAAP operating expenses for the fourth quarter were $91.8 million, or 28.4% of revenue, and on a non-GAAP basis, were $89 million or 27.6% of revenue, which excludes $3.8 million of amortization of acquisition-related intangible asset expenses and $1 million in a restructuring costs gain. This compares to GAAP operating expenses in the prior quarter of $102 million or 25.2% of revenue, and in the fourth quarter of 2022 of $109.7 million or 22.1% of revenue. Non-GAAP operating expenses in the prior quarter were $95.6 million or 23.7% of revenue.

第四季GAAP 營運費用為9,180 萬美元，佔營收的28.4%；以非GAAP 計算，營運費用為8,900 萬美元，佔營收的27.6%，其中不包括380 萬美元的收購相關無形資產攤銷費用及100 萬美元重組成本收益。相較之下，上一季的 GAAP 營運費用為 1.02 億美元，佔營收的 25.2%；2022 年第四季的 GAAP 營運費用為 1.097 億美元，佔營收的 22.1%。上一季的非 GAAP 營運費用為 9,560 萬美元，佔營收的 23.7%。

Total other income amounted to approximately $7.2 million for the quarter, consisting of $4.8 million of interest income, $3.5 million of other income, $1.8 million unrealized gain on investments, a $2.5 million foreign currency loss and $0.5 million in interest expense.

該季度的其他收入總額約為720 萬美元，其中包括480 萬美元的利息收入、350 萬美元的其他收入、180 萬美元的未實現投資收益、250 萬美元的外匯損失和50 萬美元的利息支出。

Income before taxes and noncontrolling interest in the fourth quarter 2023 was $27.9 million compared to $60.5 million in the previous quarter and $94.8 million in the prior year quarter.

2023 年第四季稅前及非控股權益前收入為 2,790 萬美元，上一季為 6,050 萬美元，上年同期為 9,480 萬美元。

Turning to income taxes. Our effective income tax rate for the fourth quarter was approximately 9.9%. For the full-year of 2023, the tax rate was approximately 17%, which was within our expected range.

轉向所得稅。我們第四季的有效所得稅率約為 9.9%。 2023年全年，稅率約為17%，在我們的預期範圍內。

GAAP net income for the fourth quarter was $25.3 million or $0.55 per diluted share compared to $48.7 million or $1.05 per diluted share last quarter and $92.1 million or $2 per diluted share in the prior year quarter. Full-year GAAP net income was $227.2 million or $4.91 per diluted share compared to $331.3 million or $7.20 per diluted share in 2022. The share count used to compute GAAP diluted EPS was 46.3 million shares for both the fourth quarter 2023 and the full-year.

第四季GAAP 淨利為2,530 萬美元，即稀釋後每股收益0.55 美元，而上一季的GAAP 淨利為4,870 萬美元，即稀釋後每股收益1.05 美元，去年同期為9,210 萬美元，即稀釋後每股收益2 美元。全年GAAP 淨利為2.272 億美元，即稀釋後每股收益4.91 美元，而2022 年為3.313 億美元，即稀釋後每股收益7.20 美元。每股盈餘的股票數量均為4,630 萬股。

Non-GAAP adjusted net income in the fourth quarter was $23.4 million or $0.51 per diluted share, which excluded net of tax, $3.1 million of acquisition-related intangible asset costs, $2.8 million gain on investments, $1.4 million non-cash mark-to-market investment value adjustment and a $0.7 million gain on restructuring costs. This compares to $52.5 million, or $1.13 per diluted share, in the prior quarter and $79.6 million, or $1.73 per diluted share, in the fourth quarter 2022. For the full-year, non-GAAP adjusted net income was $222.8 million, or $4.81 per diluted share, as compared to $339 million, or $7.36 per diluted share, in 2022.

第四季非GAAP 調整後淨利為2,340 萬美元，即每股攤薄收益0.51 美元，其中不含稅、310 萬美元的收購相關無形資產成本、280 萬美元的投資收益、140 萬美元的非現金計價收益。相較之下，上一季為5,250 萬美元，即稀釋後每股1.13 美元，2022 年第四季為7,960 萬美元，即稀釋後每股1.73 美元。億美元，即4.81 美元稀釋後每股收益為 3.39 億美元，即稀釋後每股收益 7.36 美元。

Excluding non-cash share-based compensation expense of $5.9 million, net of tax, for the fourth quarter and $24.4 million for the full-year, both GAAP earnings per share and non-GAAP adjusted EPS would have increased by $0.13 and $0.53 per diluted share, respectively.

不包括第四季 590 萬美元的稅後非現金股票補償費用和全年的 2,440 萬美元，GAAP 每股盈餘和非 GAAP 調整後每股攤薄收益將分別增加 0.13 美元和 0.53 美元分別分享。

EBITDA for the fourth quarter was $58.4 million, or 18.1% of revenue, compared to $90.6 million, or 22.4% of revenue, in the prior quarter and $129.6 million or 26.1% of revenue in the fourth quarter of 2022. For the full-year, EBITDA was $404.2 million, or 24.3% of revenue compared to $520.4 million, or 26% of revenue for 2022.

第四季 EBITDA 為 5,840 萬美元，佔營收的 18.1%，而上一季為 9,060 萬美元，佔營收的 22.4%，2022 年第四季為 1.296 億美元，佔營收的 26.1%。美元，佔營收的24.3%，而2022 年為5.204 億美元，佔營收的26%。

We have included in our earnings release a reconciliation of GAAP net income to non-GAAP adjusted net income and GAAP net income to EBITDA, which provides additional details.

我們在收益報告中納入了 GAAP 淨利潤與非 GAAP 調整後淨利潤以及 GAAP 淨利潤與 EBITDA 的調整表，其中提供了更多詳細資訊。

Cash flow generated from operations was $38.4 million for the fourth quarter and $280.9 million for the full year. Free cash flow was $11.1 million in the fourth quarter, which included $27.3 million for capital expenditures, and for the full year, free cash flow was $130.1 million, including $150.8 million for CapEx. Net cash flow was a positive $20.9 million, and for the full year, net cash flow was a negative $22.6 million, which includes the net paydown of $124.3 million of total debt.

第四季營運產生的現金流為 3,840 萬美元，全年營運產生的現金流為 2.809 億美元。第四季自由現金流為 1,110 萬美元，其中資本支出為 2,730 萬美元，全年自由現金流為 1.301 億美元，其中資本支出為 1.508 億美元。淨現金流為正 2,090 萬美元，全年淨現金流為負 2,260 萬美元，其中包括 1.243 億美元的總負債淨償還額。

Turning to the balance sheet. At the end of fourth quarter, cash, cash equivalents, restricted cash plus short-term investments totaled approximately $329 million. Working capital was $794 million and total debt, including long-term and short term was $62 million.

轉向資產負債表。截至第四季末，現金、現金等價物、限制性現金加上短期投資總計約 3.29 億美元。營運資金為 7.94 億美元，總債務（包括長期和短期）為 6,200 萬美元。

In terms of inventory, at the end of fourth quarter, total inventory days were approximately 160 as compared to 124 last quarter. Finished goods inventory days were 49 compared to 34 last quarter. Total inventory dollars increased $46.1 million from the prior quarter to $389.8 million. We increased inventory during the quarter in order to support short lead time orders and also prepare for the lower output expected in the first quarter due to Chinese New Year holiday. Total inventory in the quarter consisted of a $34.6 million increase in finished goods, an $8.1 million increase in work in process and a $3.4 million increase in raw materials.

庫存方面，第四季末總庫存天數約為160天，而上季為124天。成品庫存天數為 49 天，而上季為 34 天。庫存總額較上一季增加 4,610 萬美元，達 3.898 億美元。我們在本季度增加了庫存，以支援較短的交貨時間訂單，並為中國農曆新年假期導致的第一季產量預期下降做好準備。本季的總庫存包括產成品增加 3,460 萬美元、在製品增加 810 萬美元以及原料增加 340 萬美元。

Capital expenditures on a cash basis were $27.3 million for the fourth quarter, or 8.5% of revenue, and $150.8 million, or 9.1% of revenue, for the full-year and within our target range of 5% to 9% as we continue to invest in the future growth and expansion of our business.

第四季以現金為基礎的資本支出為 2,730 萬美元，佔收入的 8.5%；全年資本支出為 1.508 億美元，佔收入的 9.1%，在我們繼續保持 5% 至 9% 的目標範圍內。投資於我們業務的未來成長和擴張。

Now turning to our outlook. For the first quarter of 2024, we expect revenue to be approximately $305 million, plus or minus 3%. We expect GAAP gross margin to be 34% plus or minus 1%. Non-GAAP operating expenses, which are GAAP operating expenses adjusted for amortization of acquisition-related intangible assets, are expected to be approximately 28.7% of revenue, plus or minus 1%. We expect net interest income to be approximately $2 million. Our income tax rate is expected to be 18%, plus or minus 3%, and shares used to calculate EPS for the first quarter are anticipated to be approximately 46.5 million.

現在轉向我們的展望。 2024 年第一季度，我們預計營收約為 3.05 億美元，上下浮動 3%。我們預期 GAAP 毛利率為 34% 正負 1%。非 GAAP 營運費用（即針對收購相關無形資產攤銷進行調整的 GAAP 營運費用）預計約為收入的 28.7%，上下浮動 1%。我們預計淨利息收入約為 200 萬美元。我們的所得稅稅率預計為18%，正負3%，用於計算第一季每股收益的股票預計約為4650萬股。

Not included in these non-GAAP estimates is amortization of $3.1 million after tax, for previous acquisitions.

這些非 GAAP 預估中不包括先前收購的 310 萬美元稅後攤銷。

With that said, I will now turn the call over to Emily Yang.

話雖如此，我現在將電話轉給艾蜜莉楊。

Thank you, Brett, and good afternoon.

謝謝你，布雷特，下午好。

Revenue in the fourth quarter was down 20% sequentially and slightly below the midpoint of our guidance. Our global POS decreased in the quarter and our disti inventory increased slightly, remaining above our defined normal range of 11 to 14 weeks.

第四季營收季減 20%，略低於我們指引的中點。我們的全球 POS 在本季度有所下降，我們的分銷庫存略有增加，仍高於我們定義的 11 至 14 週的正常範圍。

Looking at Global Sales in the fourth quarter. Asia represented 78% of revenue; Europe 14%; and North America 8%. For the full-year of 2023, Asia represented 71% of revenue; Europe 17%; and North America 12%.

看看第四季的全球銷售額。亞洲佔收入的 78%；歐洲 14%；北美為 8%。 2023 年全年，亞洲佔收入的 71%；歐洲 17%；北美為 12%。

In terms of our end markets, industrial was 23% of Diodes' fourth quarter product revenue; automotive 18%; computing, 25%; consumer 19%; and communications 15% of product revenue. Our automotive and industrial end markets combined total 41% of the fourth quarter product revenue, representing the seventh consecutive quarter above our target model of 40%. For the full-year, industrial was 27%, auto 19%, computing 23%, consumer 18% and communications 13%. Auto and industrial revenue in 2023 reached a record 46% of product revenue compared to 42% last year.

就我們的終端市場而言，工業市場佔 Diodes 第四季產品收入的 23%；汽車業 18%；計算，25%；消費者 19%；通訊佔產品收入的 15%。我們的汽車和工業終端市場合計佔第四季產品收入的 41%，連續第七個季度高於我們 40% 的目標模型。全年來看，工業佔 27%，汽車佔 19%，計算佔 23%，消費佔 18%，通訊佔 13%。 2023 年，汽車和工業收入佔產品收入的比例達到創紀錄的 46%，而去年為 42%。

Now let me review the end markets in greater detail. Starting with the automotive market. In the fourth quarter, automotive was 18% of our total product revenue, which is a slight decrease from the last quarter's 19%. We began seeing some slowdown along with inventory rebalancing in Q4 and believe this will continue into the first quarter. For the full-year, revenue reached a record 19% of product revenue compared to 15% last year, which represented a 28% compounded annual growth rate from our initial launch into the auto market in 2013, which was only about 3% revenue at that time. Over this time period, our content per car increased from $28 in 2013 to over $160 in 2024 and Diodes' focus will continue to be on the content expansion going forward.

現在讓我更詳細地回顧一下終端市場。從汽車市場開始。第四季度，汽車業務占我們產品總營收的18%，比上季的19%略有下降。隨著第四季庫存重新平衡，我們開始看到一些放緩，並相信這種情況將持續到第一季。全年營收佔產品收入的比例達到創紀錄的19%，而去年為15%，這意味著自2013 年首次進入汽車市場以來，複合年增長率為28%，而2013 年我們的收入僅佔產品收入的3% 左右。在此期間，我們每輛車的內容從 2013 年的 28 美元增加到 2024 年的 160 美元以上，Diodes 的重點將繼續放在未來的內容擴展上。

In 2023, we introduced more than 350 new automotive-compliance products, demonstrating our commitment to this market segment. New products continue to drive the expansion of our design pipeline and total available market, while also improving our product mix. Even though we still see pockets of softness in the automotive market, design momentum has remained very strong for Diodes.

2023 年，我們推出了 350 多種符合汽車標準的新產品，體現了我們對這個細分市場的承諾。新產品持續推動我們的設計通路和可用市場總量的擴展，同時也改善了我們的產品組合。儘管我們仍然看到汽車市場的疲軟，但 Diodes 的設計勢頭仍然非常強勁。

During the fourth quarter, our TVS diodes, and ideal diode controllers continued to gain traction, while our LDOs are designed into applications for ADAS, smart cabins, Telematics and Infotainment. The adoption of our USB Type-C Re-Drivers, DisplayPort active crossbar mux and MIPI switches has increased significantly in the rear seat entertainment, smart carpet, ADAS and active cable designed for automotive applications. We also achieved several design wins for our crystal oscillators and PCI Express clock generator for the development of new ADAS designs.

第四季度，我們的 TVS 二極體和理想二極體控制器繼續受到關注，而我們的 LDO 則設計用於 ADAS、智慧駕駛室、遠端資訊處理和資訊娛樂應用。我們的 USB Type-C 轉接驅動器、DisplayPort 主動交叉復用器和 MIPI 開關在後座娛樂系統、智慧地毯、ADAS 和專為汽車應用設計的主動電纜中的採用率顯著增加。我們也為新 ADAS 設計開發的晶體振盪器和 PCI Express 時脈產生器取得了多項設計成果。

Our newly updated USB-Power Delivery controller portfolio that supports extended power range is gaining traction from in-vehicle infotainment systems and USB-Type C charging functions. Our SBR products are also seeing momentum in battery management systems, display, lighting and headlight systems.

我們最新更新的 USB 供電控制器產品組合支援擴展的功率範圍，受到車載資訊娛樂系統和 USB-Type C 充電功能的青睞。我們的 SBR 產品在電池管理系統、顯示器、照明和頭燈系統方面也表現強勁。

Also during the quarter, we saw positive design momentum for our newly released N-Channel MOSFETs, specifically targeting the growing demand for silicon carbide solutions in the electric and hybrid-electric vehicle automotive subsystems. These MOSFETs are tailored for applications such as battery chargers, onboard chargers, high-efficiency DC-DC converters, motor drivers and traction inverters. Additionally, our SBR and Schottky product shipments have ramped up significantly for EV applications.

同樣在本季度，我們看到了新發布的 N 通道 MOSFET 的積極設計勢頭，特別是針對電動和混合動力汽車子系統中對碳化矽解決方案不斷增長的需求。這些 MOSFET 專為電池充電器、車載充電器、高效 DC-DC 轉換器、馬達驅動器和牽引逆變器等應用而客製化。此外，我們針對電動車應用的 SBR 和肖特基產品出貨量顯著增加。

In the industrial market, fourth quarter revenue represented 23% of total product revenue, which was a 3 percentage point decrease sequentially due to the weaker demand and inventory rebalancing we mentioned last quarter. Since our last call, we have seen this market witness broaden.

在工業市場，第四季營收佔產品總營收的23%，由於我們上季提到的需求疲軟和庫存再平衡，季減了3個百分點。自從我們上次電話會議以來，我們看到這個市場的範圍擴大了。

For the full-year of 2023, industrial represented 27% of product revenue. Even despite the market softness, our design pipeline remained very strong throughout the year, and we continue to see new application opportunities as our content has expanded.

2023 年全年，工業佔產品收入的 27%。儘管市場疲軟，我們的設計管道全年仍然非常強勁，隨著我們內容的擴展，我們繼續看到新的應用機會。

In terms of progress on the product initiatives, our PCI Express 3 packet switch are winning designs across diverse applications, including Artificial Intelligence of Things, automation, inspection, power plant controllers, test instrument applications. These packet switches enable SoCs to connect to various endpoint devices such as wired/wireless networks, SSD storage and specific industrial controllers over the industrial standard PCI Express bus. We secured new design wins for a range of essential components like HDMI, USB Type-C, DisplayPort, MIPI re-drivers and mux switches in commercial displays, drone and robotic applications.

就產品計畫的進展而言，我們的 PCI Express 3 封包交換器贏得了各種應用的設計，包括物聯網人工智慧、自動化、檢查、發電廠控制器、測試儀器應用。這些資料包交換器使 SoC 能夠透過工業標準 PCI Express 匯流排連接到各種端點設備，例如有線/無線網路、SSD 儲存和特定工業控制器。我們在商業顯示器、無人機和機器人應用中贏得了一系列重要組件的新設計，例如 HDMI、USB Type-C、DisplayPort、MIPI 轉接驅動器和多路復用器開關。

One area of strength in the industrial market has been solar, where our SBR products have gained traction in residential roof solar panels along with our real-time clocks being used in solar systems and our TVS products being designed-in for data line protection in battery management systems for solar energy storage and battery cells. Additionally, our silicon carbide MOSFETs have been gaining traction in industrial motor drivers, solar inverters, data center and telecom power supplies.

工業市場的優勢領域之一是太陽能，我們的SBR 產品在住宅屋頂太陽能板中獲得了廣泛的關注，我們的實時時鐘被用於太陽能係統，我們的TVS 產品被設計用於電池中的數據線保護太陽能儲存和電池管理系統。此外，我們的碳化矽 MOSFET 在工業馬達驅動器、太陽能逆變器、資料中心和電信電源中越來越受歡迎。

Turning to computing markets. Fourth quarter revenue represented 25% of product revenue, which is flat to last quarter. Full-year revenue represented 23% of total product revenue compared to 24% last year. After a few quarters of inventory adjustments, we are seeing customer inventory levels returning back to normal levels. Due to the impact of Chinese New Year holiday on the first quarter revenue, we expect to see some recovery beginning in the second quarter and progressing in the second half of the year.

轉向計算市場。第四季營收佔產品營收的25%，與上季持平。全年收入佔產品總收入的 23%，而去年為 24%。經過幾季的庫存調整後，我們看到客戶庫存水準恢復到正常水準。由於春節假期對第一季營收的影響，我們預計第二季開始並在下半年取得進展。

In terms of design wins, we secured new designs and ramped production for our SBR and Schottky diodes, in notebook adapters and power applications, servers, as well as notebook motherboards. Protection devices for high-speed data lines are being designed into Chromebooks to protect the Type-C port, and our TVS products are being used to protect the power sourcing line of the solid-state drive modules for data center servers. We have also gaining momentum for signal integrity and connectivity products for various protocols in computing applications, including workstations, gaming, notebook/desktop, docking stations and add-in cards. We also secured new design wins for PCI Express clock buffers, crystal oscillators and silicon carbide Schottky diodes in servers, machine learning, and for various Power Factor Correction applications in servers.

在設計方面，我們在筆記本適配器和電源應用、伺服器以及筆記本主機板中獲得了新設計並提高了 SBR 和肖特基二極體的產量。 Chromebook中正在設計高速資料線的保護裝置來保護Type-C端口，我們的TVS產品正在用於保護資料中心伺服器的固態硬碟模組的電源線。我們還在計算應用中各種協定的訊號完整性和連接產品方面取得了進展，包括工作站、遊戲、筆記本/桌上型電腦、擴充座和附加卡。我們還贏得了伺服器中 PCI Express 時脈緩衝器、晶體振盪器和碳化矽肖特基二極體、機器學習以及伺服器中各種功率因數校正應用的新設計。

In the communication market, fourth quarter revenue was 15% of product revenue, which is an increase from 12% in the third quarter. Revenue for the full-year represented 13% of product revenue compared to 15% last year. After a few quarters of inventory adjustments in the smartphones specifically, we are seeing customer inventory levels returning back to normalized levels. In the telecom and networking market, inventory rebalancing continues.

在通訊市場，第四季營收佔產品營收的15%，較第三季的12%成長。全年收入佔產品收入的 13%，而去年為 15%。經過幾季的智慧型手機庫存調整後，我們看到客戶庫存水準恢復到正常水準。在電信和網路市場，庫存重新平衡仍在繼續。

In terms of design wins in the quarter, our timing products, including clock buffers and crystal oscillators are seeing new wins for smart NICs and connectivity products like MIPI switches and our TVS protection products are seeing adoption in smartphone applications.

就本季的設計成果而言，我們的計時產品（包括時脈緩衝器和晶體振盪器）在智慧型NIC 方面取得了新的成果，而MIPI 開關等連接產品和我們的TVS 保護產品在智慧型手機應用中得到了採用。

And lastly, in the consumer market, fourth quarter revenue represented 19%, which is a 1 percentage point increase compared to last quarter. Similar to the inventory situation in computing market and also in smartphones, after a few quarters of rebalancing, customer inventory is now mostly clean. Following the Chinese New Year holiday and the typical seasonality for consumer in the first quarter, we expect to see some recovery late in the second quarter and into the second half of the year. For the full-year, revenue in consumer market represented 18% of product revenue compared to 19% last year.

最後，在消費市場，第四季營收佔比為19%，較上季成長1個百分點。與計算市場和智慧型手機的庫存情況類似，經過幾個季度的重新平衡，客戶庫存現在基本上是乾淨的。繼中國新年假期和第一季消費的典型季節性之後，我們預計第二季末和下半年將出現一些復甦。全年消費市場收入佔產品收入的比例為18%，去年為19%。

During the quarter, we have seen strong adoption of our USB Type-C Display active crossbar mux, USB Type-C Display ReDrivers and retimers, PCI Express clock generators, real-time clocks, and signal conditioners in various applications like tablets, docking stations, USB Type-C active cables, cable extenders, cameras, televisions and monitors. We also secured design wins for our MOSFETs and MIPI switches and ReDrivers in gaming and VR/AR applications.

本季度，我們看到USB Type-C 顯示器主動交叉復用器、USB Type-C 顯示器轉接驅動器和重定時器、PCI Express 時鐘產生器、即時時鐘和訊號調節器在平板電腦、擴充座等各種應用中廣泛採用、USB Type-C 主動電纜、電纜延長器、相機、電視和顯示器。我們還贏得了遊戲和 VR/AR 應用中 MOSFET 和 MIPI 開關以及 ReDriver 的設計。

In summary, although the 3C markets have been slower to recover and overall global demand remains soft, we are encouraged by the continuous progress we have made over the past year in the automotive and industrial markets. Our team remains focused on driving new product introductions, product mix improvements, design win momentum as well as a focus on key account development. Diodes' strong cash generation has enabled us to maintain investments in support of the future growth and expansion of our business that positions us well as the global market improves throughout the coming year.

綜上所述，儘管3C市場復甦較慢，全球整體需求依然疲軟，但我們對過去一年在汽車和工業市場的持續進步感到鼓舞。我們的團隊仍專注於推動新產品推出、產品組合改進、設計獲勝動力以及重點客戶開發。 Diodes 強大的現金產生能力使我們能夠維持投資，以支持我們業務的未來成長和擴張，從而使我們在來年全球市場的改善中處於有利地位。

With that, we now open the floor to questions.

現在我們開始提問。

Operator?

操作員？

(Operator Instructions) Today's first question comes from Matt Ramsay with TD Cowen.

（操作員說明）今天的第一個問題來自 TD Cowen 的 Matt Ramsay。

It's obviously been an interesting period here as the inventory and the industry have corrected. What I wanted to start the conversation with is maybe to give a little bit more detail on where you think your sell-in for the March quarter guidance is across the different segments relative to the sell-through and how much inventory we might still need to burn down. If you could give any color by segment, that would be helpful and just where you think you are in terms of getting to that sell-in, sell-through balance, so we can start to have revenue reaccelerate out the back end.

隨著庫存和行業的調整，這顯然是一個有趣的時期。我想開始對話的可能是提供更多細節，說明您認為 3 月份季度指導的銷售在不同細分市場中相對於銷售量的情況以及我們可能仍需要多少庫存燒毀。如果您可以按細分市場給出任何顏色，這將很有幫助，並且正是您認為在達到銷售、銷售平衡方面所處的位置，這樣我們就可以開始讓收入在後端重新加速。

This is Emily. Let me address your question. So, I think from the market segment point of view, right, like I mentioned earlier, to start with automotive, what we're seeing is the inventory rebalancing kind of started in Q4, and it will continue into the first quarter. And then from the industrial market segment, we experienced weaker demand in Q4 plus inventory rebalancing. Unfortunately, we've seen the weakness broaden.

這是艾米麗。讓我回答你的問題。因此，我認為從細分市場的角度來看，就像我之前提到的那樣，從汽車行業開始，我們看到的是庫存重新平衡從第四季度開始，並將持續到第一季。然後從工業細分市場來看，我們在第四季度經歷了需求疲軟以及庫存再平衡。不幸的是，我們看到弱點在擴大。

And from the computing point of view, customer inventory is pretty clean. I think the only concern or estimate that we need to keep in mind is the Chinese New Year. So, this is definitely going to impact some of the production as well as the output. We do expect the recovery in the second quarter and progressing into the second half of the year.

從計算的角度來看，客戶庫存非常乾淨。我認為我們需要牢記的唯一關注或估計是中國新年。因此，這肯定會影響一些生產和產量。我們確實預計第二季將出現復甦，並持續到下半年。

From a communication point of view, I talked about smartphones. Customer inventory is pretty much normalized. But for the typical telecom networking or the enterprise point of view, we see the inventory rebalancing will continue. So, I think from the consumer market segment, because it's pretty wide range of applications, but I think in general, what we see in customer inventory is relatively clean. We do expect more ramp up in the late second quarter based on usual consumer seasonality cycles, right?

從溝通的角度，我談到了智慧型手機。客戶庫存幾乎已經標準化。但對於典型的電信網路或企業的角度來看，我們看到庫存重新平衡將會持續下去。所以，我認為從消費細分市場來看，因為它的應用範圍相當廣泛，但我認為總的來說，我們在客戶庫存中看到的是相對乾淨的。根據通常的消費者季節性週期，我們確實預計第二季末會有更多成長，對吧？

So that's really what we see overall by each of the market segments and the inventory situation.

這確實是我們對每個細分市場和庫存狀況的整體看法。

I guess as my follow-up question, and this maybe will be across the different business segments. I wanted to ask about the pricing environment. So -- and maybe from 2 angles. First of all, we do hear a lot about some of your larger competitors may be getting more price aggressive in certain end markets. So that's one element to it. And then secondly, I wanted to kind of compare, what you guys guided to a bit above $300 million for the March quarter. And if you compare that to, say, 3 or 4 years ago when you were at similar revenue level, maybe what the pricing has done over that period of time? Do you see -- pricing obviously increased post the pandemic when the supply was all tight. Is it coming back down rapidly? Are we -- any commentary that you have on the pricing trends would be really helpful.

我想作為我的後續問題，這可能涉及不同的業務部門。我想問一下定價環境。所以——也許可以從兩個角度來看。首先，我們確實聽到一些較大的競爭對手可能會在某些終端市場上採取更激進的價格。這就是其中的一個要素。其次，我想比較一下你們指引的三月季度略高於 3 億美元的金額。如果你將其與 3 或 4 年前收入水平相似的情況進行比較，也許那段時間的定價會發生什麼變化？你看到了嗎——疫情過後，當供應緊張時，價格明顯上漲。是否會快速回落？您對定價趨勢的任何評論都會非常有幫助。

Yes. So, I think usually, pricing is always a balance between demand and supply, right? So, when you see a weaker demand market, usually you definitely get more of the price pressure. This also varies by the type of product, right? If it's more differentiated, you usually get a little bit less price pressure versus very deep commodity, which is really that you have a lot of competitors within the same arena, right? So, what we've been saying all along is we focus on product mix improvement, which really means that strategically walking away from some of the key commodity area, right?

是的。所以，我認為通常情況下，定價總是需求和供給之間的平衡，對吧？因此，當您看到需求市場疲軟時，通常您肯定會承受更大的價格壓力。這也因產品類型而異，對吧？如果它更具差異化，那麼與非常深入的商品相比，您通常會受到較小的價格壓力，這實際上是在同一領域內有很多競爭對手，對嗎？所以，我們一直在說的是我們專注於產品組合的改進，這實際上意味著策略性地放棄一些關鍵商品領域，對嗎？

So, in general, that will continue to be our focus, and we believe with this execution of the product mix initiatives, continue to improve. That will help overall Diodes, not only from the margin point of view, but also from the revenue point of view. I think the second part of your question is we guided around 300 some range. And if I just look back to the historic numbers, let me see, I would say probably back to 2000 -- year 2000, so that's a pre-COVID time frame, that's also before the LITE-ON Semiconductor acquisition. I just look at, for example, the 3Q 2000 and that is about 310 revenue quarterly, and our margin is around 35.9%.

因此，總的來說，這將繼續是我們的重點，我們相信，透過執行產品組合計劃，我們將繼續改進。這將有助於整個 Diodes 的發展，不僅從利潤的角度來看，而且從收入的角度來看也是如此。我認為你問題的第二部分是我們指導的大約 300 個範圍。如果我回顧一下歷史數據，讓我想想，我會說可能會回到 2000 年——2000 年，所以這是新冠疫情之前的時間框架，也是光寶半導體收購之前的時間框架。例如，我只看一下 2000 年第三季度，每季的營收約為 310，我們的利潤率約為 35.9%。

And keep in mind that that's actually before the LITE-ON Semiconductor acquisition, and that pretty much gave us about 3% margin degradation. So that will be representing about 32% margin. The other difference is actually also from the underloading capacity point of view. It's quite significantly different from what we have right now versus before. So, I think that's pretty much the reference point, right? So, if you look at the overall margin, I think majority of the pressure is actually coming from the underloading. And that's also the area that we are driving very aggressively to backfill some of the capacities, improve the utilization in the near future, right? So, I would say that's really the second part of your question. I hope I answered it.

請記住，這實際上是在光寶半導體收購之前，這幾乎使我們的利潤率下降了約 3%。因此，這將代表約 32% 的利潤率。另一個區別其實也是從欠載能力的角度來看。這與我們現在的情況和以前的情況有很大不同。所以，我認為這幾乎是參考點，對嗎？因此，如果你看一下整體利潤率，我認為大部分壓力實際上來自負載不足。這也是我們正在非常積極地推動的領域，以回填一些產能，在不久的將來提高利用率，對嗎？所以，我想說這其實是你問題的第二部分。我希望我回答了。

And our next question today comes from Gary Mobley with Wells Fargo Securities.

今天我們的下一個問題來自富國銀行證券的加里·莫布里。

Emily, thanks for the detailed response to Matt's question, and that's where I want to pick up and start. So, you covered the pricing dynamics, the underutilization. But let me ask a question on gross margin in a different way. Given that Q1 should represent a seasonal low point, at least in the near term, would you expect the first quarter gross margin to be the bottom for the year? And maybe more pointedly, do you expect -- what do you expect for gross margin for the full-year? And within that, how much of a headwind does the wafer service agreements represent?

艾米麗，感謝您對馬特問題的詳細答复，這就是我想要開始的地方。因此，您介紹了定價動態和利用率不足的情況。但讓我以不同的方式問一個關於毛利率的問題。鑑於第一季應該代表季節性低點，至少在短期內，您是否預計第一季毛利率將是今年的底部？也許更尖銳的是，您預計全年的毛利率是多少？其中，晶圓服務協議帶來了多大的阻力？

Yes, Gary. So, let me answer the first portion of the question, and then I'll let Brett or Gary answer the manufacturing service agreement, right? So, definitely, Q1 with our guidance, our revenue decreased about 5.5%, matching pretty much our seasonality, right? The market is still extremely dynamic. And definitely, we are not ready to guide the second quarter. But based on the usual seasonality, usually second quarter will be a growth quarter and then the third quarter. Because the lack of, I would say, overall visibility, what we truly believe the second half is definitely going to be stronger than the first half, right?

是的，加里。那麼，讓我回答問題的第一部分，然後我會讓 Brett 或 Gary 回答製造服務協議，對吧？所以，毫無疑問，根據我們的指導，第一季我們的收入下降了約 5.5%，與我們的季節性基本相符，對吧？市場仍然非常活躍。當然，我們還沒有準備好指導第二季。但根據通常的季節性，通常第二季度將是成長季度，然後是第三季度。我想說，因為缺乏整體可見性，我們真正相信下半年肯定會比上半年更強，對嗎？

I think we just need to continue to monitor the overall market. As we grow from the revenue point of view, as we also have time to really qualify, importing additional products into our internal fab, the utilization will continue to improve, right? So, it's difficult for us to forecast the whole year. That's also not something we usually provided. But I think with the expectation of the second half will be stronger than the first half, with the product mix initiative, we continue to drive, with the total solution sales approach that we're confident that our gross margin will improve over time.

我認為我們只需要繼續監控整個市場。隨著我們從收入的角度來看，我們也有時間真正獲得資格，將更多產品進口到我們的內部晶圓廠，利用率將繼續提高，對嗎？所以，我們很難預測全年。這也不是我們通常會提供的。但我認為下半年的預期將強於上半年，透過產品組合計劃，我們繼續推動整體解決方案銷售方法，我們相信我們的毛利率將隨著時間的推移而提高。

Before I ask my follow-up, I did want to congratulate Gary on his new role. I forgot to mention that.

在我詢問後續問題之前，我確實想祝賀加里擔任新職位。我忘了提及這一點。

Well, thank you, Gary. It's my honor.

嗯，謝謝你，加里。這是我的榮幸。

Brett, you want to talk a little bit about the manufacturing?

布雷特，你想談談製造方面的事嗎？

Yes. I would just -- Gary, I would just add to what Emily said regarding what we'd expect transitionally on margin connected to the revenue expectation that we're not guiding, but from a seasonal perspective, that's what we would expect. And then as for wafer service agreement, we believe we've absorbed that transitionally and going forward, hopefully, what we would see is that would kind of be a neutral to tailwind for us as we continue to work on technology qualification and the ability to port our product into these locations as well as ability to ramp revenue and that capacity being available to us.

是的。我只是 - 加里，我只是補充一下艾米麗所說的關於我們對與我們沒有指導的收入預期相關的過渡性利潤率的預期，但從季節性角度來看，這就是我們所期望的。至於晶圓服務協議，我們相信我們已經過渡性地吸收了這一點，並展望未來，希望我們會看到，隨著我們繼續致力於技術資格和能力，這對我們來說將是一種中立的順風車。

It looks like you're bringing down -- excuse me, your non-GAAP operating expenses by about 12%, 13% from where they were a year ago. How much of that is variable versus structural? And the reason I'm asking the question is just I'm trying to get a sense of by how much operating expenses improved when revenue improves.

抱歉，您的非 GAAP 營運費用似乎比一年前下降了約 12%、13%。其中有多少是可變的與結構性的？我問這個問題的原因只是想了解當收入改善時營運費用會改善多少。

Yes. So basically, what you see in that is a combination of things. So, we have taken -- we continue to take action connected to variable things, as you mentioned, but we're also doing actions that provide restructuring inside the company to drive efficiency. We've also impacted with the performance we've had, that's been an impact on variable pay. And we continue to look at where our investments are. I think what you'll see is our continued focus on R&D and that investment being kind of flat or tied with revenue growth. And from an SG&A perspective, continuing to look for opportunities to bring that down to drive structural efficiency and then not bring it up any more than some portion of what the revenue growth would be.

是的。所以基本上，你所看到的是事物的組合。因此，正如您所提到的，我們已經採取了——我們將繼續採取與可變因素相關的行動，但我們也在採取行動，進行公司內部重組以提高效率。我們的績效也受到了影響，這對浮動薪酬也產生了影響。我們將繼續關注我們的投資方向。我認為你會看到我們對研發的持續關注，而投資卻持平或與營收成長掛鉤。從SG＆A的角度來看，繼續尋找機會降低這一點以提高結構效率，然後將其提高到收入成長的一部分。

Our next question today -- excuse me, our next question today comes from David Williams with Benchmark.

我們今天的下一個問題 - 對不起，我們今天的下一個問題來自 Benchmark 的 David Williams。

Let me add my congratulations to Gary.

讓我向加里表示祝賀。

Thanks, David.

謝謝，大衛。

Absolutely. So, a lot of my questions were around the gross margin, but maybe just on the order velocity and if you can provide any color there. It sounds like it's still a mixed bag, but inventories are clearing in better -- in a few places. So just as you think about your order velocity through the quarter and maybe how those have trended so far into this first quarter here?

絕對地。因此，我的許多問題都圍繞著毛利率，但也許只是關於訂單速度以及您是否可以在那裡提供任何顏色。聽起來仍然是魚龍混雜，但在某些地方，庫存正在更好地清理。那麼，正如您思考本季的訂單速度以及到目前為止第一季的趨勢如何一樣？

Yes. So, I think we definitely see improvement from the book-to-bill ratio point of view. And so, I think there's a lot of positive signals on the inventory side. I talked about within the 3Cs, it's getting cleaner than ever before. So, I think this is all positive. I think the unknown is really the actual demand, especially after the Chinese New Year, right? I think the China recovery is still extremely slower than anybody's expectation. So, I think overall, unfortunately, still weaker from the visibility point of view, we just need to continue to monitor it very closely. But definitely there's some good positive signs as well.

是的。因此，我認為從訂單出貨比的角度來看，我們肯定看到了改善。因此，我認為庫存方面有很多積極信號。我談到在 3C 範圍內，它比以往任何時候都變得更加乾淨。所以，我認為這都是正面的。我覺得未知才是真正的實際需求，尤其是過年之後，對吧？我認為中國的復甦仍然比任何人的預期都要慢得多。因此，我認為，不幸的是，總體而言，從可見性的角度來看，仍然較弱，我們只需要繼續非常密切地監視它。但肯定也有一些好的正面跡象。

And David, this is Gary. I will put some comment on that, too. So, I know we are going to put a lot of effort to the key account focus. That being said, we're going to put a lot of sales effort to work with key account to create demand. At the same time, when you see the short lead time PO continue to increase during this kind of period, and we kind of work with the distributor to put the right inventory in their warehouse to make sure they can handle this kind of short demand -- short lead time in the PO in time lag basis.

大衛，這是加里。我也會對此發表一些評論。所以，我知道我們將在大客戶重點上投入大量精力。話雖如此，我們將投入大量銷售精力與大客戶合作創造需求。同時，當你看到短交貨期採購訂單在這種時期持續增加時，我們會與分銷商合作，在他們的倉庫中放置正確的庫存，以確保他們能夠處理這種短需求 - -採購訂單中的交貨時間在時滯基礎上較短。

And I guess, do you get a sense that your customers that they are being fairly rational with their inventories and taking them to normal levels or do you get a sense that maybe those are being brought down too low and you might get a bit of a snapback because of replenishment there?

我想，你是否感覺到你的客戶對他們的庫存相當理性並將庫存恢復到正常水平，或者你是否感覺到這些庫存可能被降得太低了，你可能會得到一點因為補貨而snapback還有嗎？

Yes. I think that's a really challenging question, David. I think it's really down to the actual customer and their experience as well as their view. Sometimes it also involves their financial cash flow situation. So, it is a little bit dynamic, right? So what we see, I think what Gary mentioned is we start to see more urgent orders, which is really driven by probably not enough of the inventory buffer that they build into their formula, right? So, because the customer base varies a lot, that also varies a lot as well, right? So that's really where the challenge.

是的。我認為這是一個非常具有挑戰性的問題，大衛。我認為這實際上取決於實際的客戶、他們的體驗以及他們的觀點。有時也涉及到他們的財務現金流狀況。所以，它有點動態，對吧？所以我們看到，我認為加里提到的是我們開始看到更緊急的訂單，這實際上是由他們在公式中建立的庫存緩衝不足所驅動的，對嗎？那麼，由於客戶群差異很大，所以也有很大差異，對嗎？這才是真正的挑戰。

But I think just like Gary mentioned, we focus more on to the quality of the products on the shelf. So, we can actually pretty much quickly adjust our support to the customers with this kind of very short lead time orders, right? So that's really pretty much what we focused on and will continue to focus for the next few quarters as the market continue to evolve, right?

但我認為就像加里提到的那樣，我們更關注貨架上產品的品質。因此，我們實際上可以透過這種交貨時間非常短的訂單快速調整對客戶的支持，對嗎？所以這確實是我們關注的重點，隨著市場的不斷發展，我們將在接下來的幾季繼續關注，對嗎？

Any other questions?

還有其他問題嗎？

Other questions?

還有其他問題嗎？

Hello?

你好？

That was it for me.

對我來說就是這樣。

It just went silent.

它就這麼沉默了。

Our next question today comes from William Stein with Truist Securities.

今天我們的下一個問題來自 Truist Securities 的 William Stein。

Also, Gary, I wanted to offer my congrats.

另外，加里，我想表示祝賀。

Thank you so much, Bill.

非常感謝你，比爾。

I'm hoping you can talk to the split of revenue that went direct versus to the channel in the quarter.

我希望您能談談本季直接收入與通路收入的分配情況。

Yes. So, for the fourth quarter and our split by the channel is actually 65% distribution and 35% direct. This number usually varies a little from quarter-to-quarter. It depends on the customer demand and some of the order situation. I usually say rule of thumb is probably about 2/3 distribution, 1/3 the direct portion.

是的。因此，對於第四季度，我們按通路劃分的實際上是 65% 的分銷管道和 35% 的直接管道。這個數字通常每季都會有一點變化。這取決於客戶的需求和一些訂單情況。我通常說的經驗法則大概是 2/3 分佈，1/3 直接部分。

Also, I wonder to what degree the inventory build helped gross margins for the quarter. Usually when -- it relates to a question I'll ask in -- concurrently with this, and that is utilization. Can you tell us what fab utilization was in the quarter, what you expect it to be next quarter? And then also the dynamic that I expect occurred in the Q4, which is when you build inventory like that, normally, it's a boost to gross margin? And if you can quantify that?

另外，我想知道庫存增加在多大程度上有助於本季的毛利率。通常，當它與我將提出的一個問題同時發生時，那就是利用率。您能否告訴我們本季晶圓廠利用率是多少，您預計下季是多少？然後，我預計第四季度會發生動態，即當您建立這樣的庫存時，通常會提高毛利率？如果你能量化這一點？

Well, I think what you saw, Will, in terms of our -- we've talked about strategically putting availability in place, both from a kind of finished goods availability, but also from the availability as we procure about half of our wafers on the outside so that we can have flexibility in mix to build what we need. And so, as you look at that and you look at utilization and then you also look at typically in fourth quarter, we're building in anticipation and preparing for Chinese New Year. And so, when you look at the combination of that, what we saw from a utilization perspective was something that was pretty consistent.

好吧，我認為你所看到的，威爾，就我們而言，我們已經討論了戰略性地落實可用性，既來自成品的可用性，也來自我們採購大約一半晶圓的可用性。可以靈活地組合來建立我們需要的東西。因此，當你看看這一點，看看利用率，然後再看看第四季度的情況時，我們正在為農曆新年做好準備。因此，當你將其結合起來時，我們從利用率的角度看到的是非常一致的。

We continue to run below where we want to be. We're -- and we believe that is something that's going to help us as we go forward as revenue starts to hopefully strengthen and we're in a position to be able to drive more inside the factory. So, we didn't really -- obviously it is all related. But as we look at fourth quarter, it wasn't something that we drove utilization up in order to deliver those results.

我們繼續在我們想去的地方運行。我們相信，隨著收入開始有望增強，我們相信這將有助於我們前進，並且我們能夠在工廠內推動更多業務。所以，我們並沒有真正——顯然這一切都是相關的。但當我們回顧第四季時，我們並沒有為了實現這些結果而提高利用率。

And our next question today comes from Tristan Gerra with Baird.

今天我們的下一個問題來自 Tristan Gerra 和 Baird。

So just going back on gross margin, what's the impact on the utilization in terms of bids? And sorry, if I missed, if you quantified what the utilization rates are currently? And then is there a way to break down how much of the underutilization is from the service agreements where I know you're qualifying new products to fill capacity as opposed to just a general weakness in demand?

那麼，回到毛利率，對出價利用率有何影響？抱歉，如果我錯過了，您是否量化了目前的使用率？那麼，有沒有一種方法可以細分有多少未充分利用是由於服務協議造成的，我知道您正在驗證新產品來填補產能，而不僅僅是需求的普遍疲軟？

Well, what we've talked about, Tristan, was we talked about the fact that from an overall utilization perspective, we ran pretty consistent from third to fourth quarter. We continue to run below where we want to be. In doing that, we have, I think, successfully been able to get better availability in place to support a short-time ordering that we're seeing. We've also been able to address getting -- our hybrid manufacturing model services about half of our wafers outside the company. So, we've put some more availability in place on that. That's not something that really drives up our utilization. And we believe that from a wafer service contract perspective, we've pretty much absorbed the negative impacts in transition, and we believe going forward, that's a kind of neutral to positive thing as we continue to qualify our technologies internal.

好吧，特里斯坦，我們談論的是這樣一個事實：從整體利用率的角度來看，我們從第三季到第四季的運行情況相當一致。我們繼續在我們想去的地方運行。我認為，透過這樣做，我們已經成功地獲得了更好的可用性來支持我們所看到的短期訂購。我們也能夠解決我們的混合製造模式為公司外部大約一半的晶圓提供服務的問題。因此，我們為此提供了更多可用性。這並不能真正提高我們的利用率。我們相信，從晶圓服務合約的角度來看，我們幾乎已經吸收了轉型過程中的負面影響，並且我們相信，隨著我們繼續在內部驗證我們的技術，展望未來，這是一種中性到正面的事情。

We can bring loadings internal, and we can help enable revenue growth. But in total, we're running below where we want to be, and we have been at that place for really all of this year. And we continue to be there in anticipation for things to strengthen as Emily had kind of gone through and what we anticipate kind of going into '24.

我們可以將負載引入內部，並且可以幫助實現收入成長。但總的來說，我們的表現低於我們想要的水平，而且今年我們實際上一直處於這個位置。我們繼續在那裡期待事情會加強，因為艾米麗已經經歷了一些事情，以及我們預計進入 24 年的事情。

Yes. And one comment I would like to put here, Tristan, and this is Gary, and when we're facing several key account customers, they kind of talk about the utilization of our internal wafer fab. I think that really kind of -- think about it is like in the future growth, they really want to make sure Diodes have this kind of capability, can support their growth in the future. So, I would say like we are still in the kind of underutilization level, as Brett mentioned about, but for the future as long as we qualify our product and process into our own internal fab and we should have this kind of capability to support more business to our customer.

是的。我想在這裡發表評論，特里斯坦，這是加里，當我們面對幾個大客戶時，他們會談論我們內部晶圓廠的利用率。我認為這確實是——想想在未來的成長中，他們真的想確保 Diodes 擁有這種能力，能夠支持他們未來的成長。所以，我想說，正如布雷特所提到的那樣，我們仍然處於利用率不足的水平，但在未來，只要我們將我們的產品和工藝納入我們自己的內部工廠，我們就應該擁有這種能力來支援更多為我們的客戶提供業務。

And then for my follow-up, I believe most of your pricing agreements are in automotive. So outside of automotive in terms of your revenue that's not locked into pricing agreement, I mean what type of feedback are you getting from customers? Are people trying to ask for better pricing or is it relatively stable? And how do you think that evolves through the rest of this year?

對於我的後續行動，我相信你們的大部分定價協議都是在汽車領域。因此，在汽車行業之外，就您的收入而言，未鎖定在定價協議中，我的意思是您從客戶那裡得到了哪些類型的回饋？人們是否試圖要求更好的定價或相對穩定的定價？您認為今年剩下的時間這種情況會如何發展？

Yes. I think, Tristan, it really varies a lot. It depends on the end market, right? So, you're absolutely right. Usually, in the automotive market segment, we actually have a longer time price matrix type of agreement in place with the customers. And for example, in the computing market segment, it's going to be a lot more function and feature protocol-driven discussion than some of the others. So of course, price competitiveness is a given, right? If we take more extreme in the consumer market, because the overall cost is very sensitive. The demand is weaker, you tend to get more of the pricing discussions, right?

是的。我認為，特里斯坦，這確實有很大不同。這取決於最終市場，對嗎？所以，你是完全正確的。通常，在汽車細分市場中，我們實際上與客戶簽訂了較長時間的價格矩陣類型協議。例如，在計算市場領域，與其他一些市場相比，將有更多的功能和特性協議驅動的討論。當然，價格競爭力是理所當然的，對嗎？如果我們在消費市場採取更極端的做法，因為整體成本非常敏感。需求減弱，您往往會得到更多的定價討論，對吧？

So, I think it varies a lot. It also varies from customer to customer. But in general, right, definitely as the demand is weaker, you definitely get a little bit more price pressure. It's almost going back to my discussion earlier. It depends on the product type. If it's a function feature rich type of product, you get less of the competition. If it's a deep commodity, you get more. And just keep in mind that pre-COVID, Diodes actually had a 1.5% to 2% built in quarterly price reduction. So, we are actually definitely structured to support this kind of overall pricing, I would say, trend. And the way to really focus on is actually improve the manufacturing efficiency and the cost down to really balance this kind of pressure that we're seeing in the market.

所以，我認為差異很大。它也因客戶而異。但總的來說，隨著需求的減弱，你肯定會受到更大的價格壓力。這幾乎又回到了我之前的討論。這取決於產品類型。如果它是功能豐富的產品類型，那麼您的競爭就會較少。如果它是深度商品，你會得到更多。請記住，在新冠疫情之前，Diodes 實際上每季降價 1.5% 到 2%。因此，我們的結構實際上肯定是支持這種整體定價趨勢的。真正關注的方法實際上是提高製造效率和降低成本，以真正平衡我們在市場上看到的這種壓力。

Thank you. And this concludes today's question-and-answer session. I'd like to turn the conference back over to the company's President, Gary Yu.

謝謝。今天的問答環節到此結束。我想將會議轉交給公司總裁 Gary Yu。

Thank you, everyone, for participating on today's call. We look forward to reporting our progress on next quarter's conference call.

謝謝大家參加今天的電話會議。我們期待在下個季度的電話會議上報告我們的進展。

Operator, you may now disconnect it.

接線員，您現在可以斷開連接了。

Thank you, sir. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful day.

謝謝您，先生。今天的電話會議到此結束。我們感謝大家參加今天的演講。您現在可以斷開線路，度過美好的一天。