Entegris Inc (ENTG) 2019 Q2 法說會逐字稿

Good day, everyone, and welcome to the Entegris' Second Quarter 2019 Earnings Release Call. Today's call is being recorded.

大家好，歡迎參加 Entegris 2019 年第二季財報發布電話會議。今天的通話將會被錄音。

At this time, I would like to turn the call over to Mr. Bill Seymour, VP of Investor Relations. Please go ahead, sir.

此時，我想把電話交給投資人關係副總裁比爾‧西摩先生。請繼續，先生。

Good morning, everyone. Earlier today, we announced the financial results for our second quarter of 2019. Before we begin, I would like to remind listeners that our comments today will include some forward-looking statements. These statements involve a number of risks and uncertainties, which are outlined in detail in our reports and filings with the SEC. Please refer to the information on the disclaimer slide in the presentation.

各位早安。今天早些時候，我們公佈了2019年第二季的財務表現。在開始之前，我想提醒各位聽眾，我們今天的評論將包含一些前瞻性陳述。這些聲明涉及諸多風險和不確定性，我們在提交給美國證券交易委員會的報告和文件中對此進行了詳細闡述。請參閱簡報中免責聲明投影片上的資訊。

On this call, we will also refer to non-GAAP financial measures as defined by the SEC in Regulation G. You will find a reconciliation table in today's press release as well as on our website.

本次電話會議中，我們也將提及美國證券交易委員會G條例定義的非GAAP財務指標。您可以在今天的新聞稿以及我們的網站上找到相應的調節表。

I'd also like to remind you that there is a slide presentation on the results posted on our website that may be referenced during the call today.

我還想提醒各位，我們網站上發布了關於此研究結果的幻燈片演示文稿，您可以在今天的電話會議中參考該演示文稿。

On the call today are Bertrand Loy, our CEO; and Greg Graves, our CFO. I'll hand it over to Bertrand.

今天參加電話會議的有我們的執行長 Bertrand Loy 和我們的財務長 Greg Graves。我會把它交給伯特蘭。

Thank you, Bill. I will make some comments on our second quarter performance, how we see the industry environment and our expectations for the rest of the year. I will also discuss the organizational changes we announced today. Greg will follow with more details on our financial results, discuss our updated capital allocation framework and provide guidance for the third quarter of 2019. We'll then open the line for questions.

謝謝你，比爾。我將就我們第二季的業績、我們對行業環境的看法以及我們對今年剩餘時間的預期發表一些評論。我也會談談我們今天宣布的組織架構調整。Greg 隨後將詳細介紹我們的財務業績，討論我們更新後的資本配置框架，並提供 2019 年第三季的業績指引。接下來我們將開放提問環節。

During the second quarter, headwinds in the market resulted in a softer-than-anticipated quarter for both the industry and Entegris. Let me provide some additional color. The memory market continued to languish as inventories at memory makers remained high. As a result, utilization rates and wafer starts remained low at most memory customers. In addition, production levels in mainstream fabs were somewhat weaker than expected as escalated trade tensions impacted industrial and automotive end markets.

第二季度，市場逆風導致整個產業和 Entegris 的業績均低於預期。我再補充一些細節。由於記憶體製造商的庫存居高不下，記憶體市場持續低迷。因此，大多數記憶體客戶的使用率和晶圓開工量仍然很低。此外，由於貿易緊張局勢升級影響了工業和汽車終端市場，主流晶圓廠的產量水準略低於預期。

Finally, the industry CapEx continued to weaken during the quarter. However, on a positive note for Entegris, we continued to see great momentum with our advanced solutions in new nodes, particularly in logic and foundry. Our SCEM division, as expected, rebounded from a soft first quarter led by record sales and double-digit organic sequential growth of advanced deposition materials. Our CapEx-driven businesses stabilized and have now a healthy book-to-bill ratio as we start Q3.

最後，本季行業資本支出持續疲軟。不過，對於 Entegris 來說，也有積極的一面，我們看到我們在新節點上的先進解決方案，尤其是在邏輯和晶圓代工領域，繼續保持著強勁的發展勢頭。正如預期的那樣，在先進沉積材料創紀錄的銷售額和兩位數的有機環比增長的帶動下，我們的SCEM部門從疲軟的第一季中反彈。隨著第三季的開始，我們以資本支出為驅動的業務已經穩定下來，訂單出貨比也達到了健康的水平。

Last week, we acquired MPD Chemicals, further enhancing our advanced materials portfolio.

上週，我們收購了 MPD Chemicals，進一步增強了我們的先進材料產品組合。

And finally, we continued to return cash to shareholders with a recently announced 14% increase in our quarterly dividend and over $50 million of share repurchases since the beginning of the year, including $15 million in the second quarter.

最後，我們繼續向股東返還現金，最近宣布季度股息增加 14%，並且自年初以來已回購超過 5,000 萬美元的股票，其中包括第二季的 1,500 萬美元。

While this has been the most challenging year the industry has faced in some time, Entegris has weathered the storm relatively well. Having said that, Entegris' culture is guided by an intense focus on customer centricity and relentless dedication to excellence. Accordingly, we continuously pursue opportunities to improve our customer engagement and create conditions that yield greater leverage in our overall business model. To that end, we are implementing organizational changes that will enable us to be more responsive to our customers, increase our competitiveness and allow for scalable growth as well as result in significant cost savings. These changes are focused on streamlining the organization and optimizing our customer engagement model. We anticipate the efficiencies gained by these changes will result in more than $20 million in annual cost savings or 1 point of EBITDA. These actions will largely be in place by the beginning of the fourth quarter this year.

儘管今年是該行業近年來面臨的最具挑戰性的一年，但 Entegris 相對而言已經很好地度過了難關。儘管如此，Entegris 的企業文化仍然以高度重視客戶為中心，並堅持不懈地追求卓越為指導。因此，我們將持續尋求機會來改善客戶互動，並創造條件，從而在我們的整體商業模式中獲得更大的優勢。為此，我們正在實施組織變革，這將使我們能夠更好地回應客戶需求，提高競爭力，實現可擴展的成長，並帶來顯著的成本節約。這些變革旨在精簡組織架構，優化客戶互動模式。我們預計這些改變帶來的效率提升將帶來每年超過 2,000 萬美元的成本節約或 1 個百分點的 EBITDA。這些措施將在今年第四季初基本落實到位。

Last week, we acquired MPD Chemicals, a provider of advanced materials to the specialty chemical, technology and life sciences industries. MPD will further enhance our engineered and advanced materials portfolio, which was recently expanded with the acquisition of Digital Specialty Chemicals, or DSC, in March. The deposition materials market is one of the fastest-growing market segments in semiconductor applications driven by the adoption of new materials in more complex chip architectures.

上週，我們收購了 MPD Chemicals，這是一家為特種化學品、技術和生命科學產業提供先進材料的供應商。MPD 將進一步增強我們的工程和先進材料產品組合，該產品組合最近透過 3 月收購 Digital Specialty Chemicals（簡稱 DSC）而擴展。沉積材料市場是半導體應用領域中成長最快的市場區隔之一，其成長動力來自更複雜的晶片架構中新材料的採用。

MPD will improve Entegris' scale and synthesis capabilities, particularly in organosilane materials. Existing compatibilities combined with DSC and MPD will give us the technology and proven capability to effectively compete in advanced nodes. In addition, MPD will provide us access to a number of exciting adjacent markets.

MPD 將提升 Entegris 的規模和合成能力，尤其是在有機矽烷材料方面。現有的兼容性，結合 DSC 和 MPD，將使我們擁有在先進節點中有效競爭所需的技術和成熟能力。此外，MPD也將為我們帶來許多令人興奮的鄰近市場。

MPD was acquired for approximately $165 million in cash. It is expected to have sales approaching $40 million for the full year of 2019 and be accretive to earnings in 2020. MPD will be part of our SCEM business.

MPD的收購價格約為1.65億美元現金。預計 2019 年全年銷售額將接近 4,000 萬美元，並在 2020 年增加收益。MPD將成為我們SCEM業務的一部分。

Looking ahead to the second half of the year. To start, we believe the second quarter represents a bottom for Entegris. From an industry point of view, memory makers are still working through inventory, but logic and foundry is solid. But to be clear, our confidence is not a bet on a significant market recovery in the second half. Our confidence instead is based on the strength of our business. As we discussed last quarter, we are benefiting from several important node transitions, which will drive the adoption of many new products across all 3 divisions. In addition, after several quarters of weakness, we believe that we've reached an inflection point in our CapEx-driven products, which are no longer declining and now starting to see steadier order patterns.

展望下半年。首先，我們認為第二季度是 Entegris 的底部。從產業角度來看，記憶體製造商仍在消化庫存，但邏輯電路和代工業務依然穩健。但要明確說明的是，我們的信心並非押注於下半年市場將大幅復甦。相反，我們的信心源自於我們業務的實力。正如我們上個季度所討論的，我們正受益於幾個重要的節點轉型，這將推動所有 3 個部門採用許多新產品。此外，經過幾個季度的疲軟，我們認為，我們以資本支出為驅動的產品已經達到了一個轉折點，這些產品的銷售不再下降，現在開始出現更穩定的訂單模式。

In closing, we believe that secular semiconductor demand will continue to be attractive. Enabled by technologies like IoT, 5G and AI, our society will continue to need more embedded chips. Greater materials intensity and greater materials purity will be the 2 defining factors of the next generation of semiconductor performance.

最後，我們認為半導體產業的長期需求將繼續保持吸引力。在物聯網、5G 和人工智慧等技術的推動下，我們的社會將持續需要更多的嵌入式晶片。更高的材料強度和更高的材料純度將是下一代半導體性能的兩個決定性因素。

Our unit-driven business model is resilient, differentiated and defensible. Entegris has never been better positioned and more relevant for customers to achieve higher yields and targeted levels of chip performance and reliability.

我們以單元為導向的商業模式具有韌性、差異化和可防禦性。Entegris 從未像現在這樣處於如此有利的地位，也從未像現在這樣與客戶的需求如此契合，能夠幫助客戶實現更高的良率以及達到預期的晶片性能和可靠性水平。

As we have shown with the reorganization announced today and the recent acquisitions, we are continually assessing and dynamically managing our portfolio to drive growth and improve returns. And while results were challenging in the second quarter, we have continued to make the necessary capital and R&D investments in our business to enable long-term growth.

正如我們今天宣布的重組和最近的收購所表明的那樣，我們正在不斷評估和動態管理我們的投資組合，以推動成長並提高回報。儘管第二季業績充滿挑戰，但我們仍在業務中持續進行必要的資本和研發投資，以實現長期成長。

Finally, we expect 2019 to be a record year for Entegris, and we are reaffirming our annual guidance. We expect our sales in 2019 to be approximately $1.6 billion, and we expect both GAAP and non-GAAP EPS to exceed $1.90.

最後，我們預計 2019 年將是 Entegris 創紀錄的一年，我們重申我們的年度業績預期。我們預計 2019 年的銷售額約為 16 億美元，我們預計 GAAP 和非 GAAP 每股收益將超過 1.90 美元。

I will now turn the call to Greg for financial details. Greg?

現在我將把電話轉給格雷格，詢問財務細節。格雷格？

Thank you, Bertrand. Our overall second quarter performance was mixed relative to our expectations. Q2 sales of $379 million were at the bottom end of our sales guidance range and were down 1% from a year ago and 3% sequentially.

謝謝你，伯特蘭。與預期相比，我們第二季的整體業績喜憂參半。第二季銷售額為 3.79 億美元，處於我們銷售預期範圍的下限，比去年同期下降 1%，比上年同期下降 3%。

Q2 GAAP diluted earnings per share was $0.91. GAAP EPS included $122 million of net proceeds we received from the terminated Versum transaction. On a non-GAAP basis, EPS of $0.39 was below expectation.

第二季GAAP稀釋後每股盈餘為0.91美元。GAAP EPS 包括我們從終止的 Versum 交易中獲得的 1.22 億美元淨收益。以非GAAP準則計算，每股收益為0.39美元，低於預期。

Moving on to gross margins, GAAP and non-GAAP gross margin were both 44% in Q2. The year-on-year decline in non-GAAP gross margin was driven primarily by the addition of the Pure Gas business acquired from SAES to the portfolio, lower sales volume, weaker product mix and an insurance claim in the prior year that was one time in nature. We expect gross margin to be approximately 46% on a GAAP and non-GAAP basis in Q3, driven by higher sales volumes and improved mix.

接下來看毛利率，第二季 GAAP 和非 GAAP 毛利率均為 44%。非GAAP毛利率年減的主要原因是：從SAES收購的純氣業務被納入投資組合，銷售量下降，產品組合疲軟，以及去年發生的一次性保險索賠。我們預計第三季毛利率（以 GAAP 和非 GAAP 計算）約為 46%，這主要得益於更高的銷售量和更優的產品組合。

GAAP operating expenses were $111 million and included approximately $17 million of amortization of intangible assets and other discrete charges totaling approximately $5 million. Non-GAAP operating expenses in Q2 were $90 million, in line with our guidance. We expect non-GAAP operating expenses to be $92 million to $94 million in the third quarter. The sequential increase from Q2 is primarily due to the additional OpEx related to MPD Chemicals.

GAAP 營運費用為 1.11 億美元，其中包括約 1,700 萬美元的無形資產攤銷和其他約 500 萬美元的單獨費用。第二季非GAAP營運支出為9000萬美元，與我們的預期一致。我們預計第三季非GAAP營運費用為9,200萬美元至9,400萬美元。與第二季相比的環比成長主要是由於與 MPD Chemicals 相關的額外營運支出。

GAAP operating income was $55 million, and non-GAAP operating income was $77 million. Our GAAP tax rate was 25.9% for the second quarter and included a total 6 percentage point impact in discrete items related to new tax regulations and the tax impact of the Versum termination payment. We expect our full year GAAP tax rate to be approximately 23%.

GAAP 營業收入為 5,500 萬美元，非 GAAP 營業收入為 7,700 萬美元。第二季度，我們的 GAAP 稅率為 25.9%，其中包括與新稅務法規相關的離散項目以及 Versum 終止付款的稅務影響，總計 6 個百分點的影響。我們預計全年GAAP稅率約為23%。

Our non-GAAP tax rate was 20.4% and does not include the discrete items previously mentioned. We continue to expect our full year non-GAAP tax rate to be approximately 21%.

我們的非GAAP稅率為20.4%，不包括前面提到的個別項目。我們仍然預計全年非GAAP稅率約為21%。

Adjusted EBITDA for the quarter was $95 million or 25% of revenue.

本季調整後 EBITDA 為 9,500 萬美元，佔營收的 25%。

Turning to our performance by division. Q2 sales of $128 million for Specialty Chemicals and Engineered Materials, or SCEM, declined 5% from a year ago. Strong growth in advanced deposition was offset by declines in the rest of the portfolio. Sales trends improved from the decline in the first quarter, with sequential sales up 2% in the second quarter driven by advanced depositions, specialty gases and specialty coatings.

接下來我們來看看各部門的業績。特種化學品和工程材料（SCEM）第二季銷售額為 1.28 億美元，比去年同期下降 5%。高級沉積業務的強勁成長被其他業務的下滑所抵消。銷售趨勢較第一季的下滑有所改善，第二季度環比銷售額增長 2%，這主要得益於先進的沉積技術、特種氣體和特種塗料。

Adjusted operating margin for SCEM was 19.4%. The decline in operating margin was driven primarily by the lower sales, unfavorable mix and investments in manufacturing capacity in previous quarters. In addition, and as a reminder, the second quarter last year included the benefit of a $2.5 million insurance claim.

SCEM 的調整後營業利益率為 19.4%。營業利潤率下降的主要原因是前幾季銷售額下降、產品組合不利以及對生產能力的投資。另外，提醒一下，去年第二季包括了 250 萬美元的保險理賠收益。

Q2 sales of $150 million for Microcontamination Control, or MC, were up 20% from last year. The strong year-on-year growth in the quarter was driven by the addition of the Pure Gas business acquired from SAES. Sales declined 5% sequentially driven by liquid filtration, which had a record quarter in Q1 as we benefited from the initial phases of node transition.

微污染控制（MC）業務第二季銷售額達 1.5 億美元，比去年同期成長 20%。本季強勁的年成長主要得益於從 SAES 收購的 Pure Gas 業務的加入。受液體過濾業務的影響，銷售額環比下降 5%，該業務在第一季創下歷史新高，因為我們受益於節點過渡的初期階段。

Adjusted operating margin for MC was 28.7%. The modest decline from last year was primarily due to the addition of the Pure Gas business to the portfolio.

MC的調整後營業利益率為28.7%。與去年相比略有下降，主要是由於將 Pure Gas 業務納入了投資組合。

Q2 sales for Advanced Materials Handling, or AMH, of $108 million was down 18% from last year. The year-over-year decline in sales was driven by continued softness in capital-driven businesses and the impact from the divestiture of a small noncore cleaning business last year. Sales declined 7% sequentially as industry capital spending continued to decline, and we experienced weakness in sales to certain chemical customers, who were negatively impacted by the continued decline in memory.

先進材料處理公司（AMH）第二季銷售額為 1.08 億美元，比去年同期下降 18%。銷售額較去年同期下降的原因是資本驅動型業務持續疲軟，以及去年剝離小型非核心清潔業務的影響。由於產業資本支出持續下降，銷售額環比下降 7%，同時，由於記憶體持續下降，我們對某些化學客戶的銷售也出現疲軟。

Adjusted operating margin for AMH was 14%. AMH margins were primarily impacted by the lower sales volumes. As Bertrand indicated, sales signals for our capital-driven businesses have improved and that will be helpful to AMH going forward.

AMH的調整後營業利益率為14%。AMH利潤率主要受到銷量下降的影響。正如 Bertrand 所指出的，我們資本驅動型業務的銷售訊號有所改善，這對 AMH 的未來發展將有所幫助。

Cash flow from operations for the second quarter was $231 million, and free cash flow was $205 million. Both operating cash flow and free cash flow were favorably impacted by the Versum termination fee.

第二季經營活動產生的現金流量為 2.31 億美元，自由現金流量為 2.05 億美元。Versum終止費對經營現金流和自由現金流均產生了有利影響。

Uses of cash during the quarter included CapEx of $26 million. We expect to spend approximately $110 million on CapEx in 2019 to support new product introductions, improved technical capabilities and growth in our filtration and liquid packaging businesses.

本季現金使用情況包括資本支出 2,600 萬美元。我們預計 2019 年將在資本支出方面投入約 1.1 億美元，以支援新產品的推出、技術能力的提升以及過濾和液體包裝業務的成長。

During Q2, we used $9 million for our quarterly dividend, and we repurchased 400,000 shares for approximately $15 million at an average price of $36.

第二季度，我們用 900 萬美元支付了季度股息，並以平均每股 36 美元的價格回購了 40 萬股股票，總金額約為 1500 萬美元。

As Bertrand set up earlier, I would like to spend a few minutes to lay out more formally than we've done in the past our capital allocation principles. Over the last 6 years, we've allocated approximately $3 billion of capital, including investing $640 million in ER&D with the goal of growing the business and returning cash to shareholders.

正如伯特蘭之前所闡述的，我想花幾分鐘時間，比我們過去更正式地闡述我們的資本配置原則。過去 6 年，我們投入了約 30 億美元的資金，其中包括投資 6.4 億美元用於研發，目標是發展業務並向股東返還現金。

To start, I'd like to lay out a few principles on our liquidity and capital structure, which is intended to ensure our financial flexibility while retaining sufficient firepower for potential opportunistic acquisitions. We target a minimum cash balance of approximately $200 million globally and a debt rating of Ba1 or better.

首先，我想闡述我們流動性和資本結構的一些原則，旨在確保我們的財務彈性，同時保留足夠的實力進行潛在的機會性收購。我們的目標是在全球範圍內保持至少約 2 億美元的現金餘額，並獲得 Ba1 或更高的債務評級。

Going forward, our capital allocation priorities are the following: the first priority is internal investments in R&D and CapEx; the second priority is value-accretive acquisitions; the third priority is return of capital in the form of dividends and share buybacks.

展望未來，我們的資本配置優先事項如下：第一優先事項是內部研發和資本支出投資；第二優先事項是增值收購；第三優先事項是以股息和股票回購的形式返還資本。

Let's look at each of these more closely.

讓我們更仔細地看一下這些內容。

Internal investments in R&D and CapEx have been a key component to our growth and generated very good returns historically. All R&D and CapEx are decided upon and prioritized based on rigorous ROI analysis. On an ongoing basis, we would expect to continue investing approximately 8% of our annual sales in R&D and 7% in CapEx. Acquisitions have historically been the largest area of capital allocation for us and have been a key component of our growth. As shown with the acquisition of MPD, we will continue to be active in M&A and intend to be a consolidator in the industry.

內部研發和資本支出投資一直是公司發展的關鍵組成部分，從歷史上看，這些投資產生了非常好的回報。所有研發和資本支出都是根據嚴格的投資報酬率分析來決定和優先排序的。我們預計將持續把年度銷售額的約 8% 投入研發，7% 投入資本支出。從歷史上看，收購一直是我們最大的資本配置領域，也是我們成長的關鍵組成部分。正如收購 MPD 所表明的那樣，我們將繼續積極參與併購活動，並打算成為產業整合者。

Our overall criteria are acquisitions to broaden our technology and product portfolio in our core semiconductor market and other adjacent markets, specifically within the scope of engineered materials, filtration technology and advanced packaging. Our targeted financial criteria for acquisitions include accretion by year 2 that is greater than we could achieve through buyback through debt reduction, high single-digit ROIC by year 3 and growth-enabling capabilities or market expansion.

我們的總體標準是透過收購來擴大我們在核心半導體市場和其他鄰近市場的技術和產品組合，尤其是在工程材料、過濾技術和先進封裝領域。我們對收購的目標財務標準包括：第二年實現的增值大於我們透過債務回購所能實現的增值；第三年實現較高的個位數投資回報率；以及具備成長能力或市場擴張能力。

The third priority is return of capital with dividends and share buybacks. Our target is to return 60% of our annual free cash flow to shareholders through dividends and buybacks. For dividends, we intend to pay an ongoing dividend with incremental increases as free cash flow warrants. For share repurchases, historically, we have targeted approximately $10 million per quarter of ongoing repurchases. Going forward, we expect repurchases to be approximately $15 million per quarter as we did in Q2. In addition, we'll continue with opportunistic buybacks like we did at the end of last year when appropriate. Naturally, these capital allocation parameters could change depending on the level of acquisition activity.

第三項優先事項是透過分紅和股票回購返還資本。我們的目標是透過分紅和股票回購，將年度自由現金流的 60% 返還給股東。對於股息，我們計劃持續派發股息，並根據自由現金流逐步增加股息。從歷史上看，我們在股票回購方面，每季的目標回購金額約為 1000 萬美元。展望未來，我們預計每季回購金額約為 1500 萬美元，與第二季的情況相同。此外，我們將繼續像去年底那樣，在適當的時候進行機會性股票回購。當然，這些資本配置參數可能會根據收購活動的水平而變化。

Turning to our outlook for Q3. As Bertrand said, we expect that Q2 represents the bottom for Entegris, and we expect Entegris-specific drivers will allow us to outgrow the market in the second half. On margins, we expect sequential improvement to come primarily from higher sales volumes, improved mix, better execution and the start of realization of cost reductions associated with the organizational changes discussed earlier.

接下來展望第三季。正如伯特蘭所說，我們預計第二季是 Entegris 的底部，我們預計 Entegris 特有的驅動因素將使我們在下半年超越市場成長。在利潤率方面，我們預計持續改善主要來自更高的銷售量、更優化的產品組合、更好的執行以及之前討論過的組織變革所帶來的成本降低的開始實現。

Putting it all together, in Q3, we expect sales to range from $385 million to $400 million, and we expect GAAP EPS to be $0.29 to $0.34 per share and non-GAAP EPS to be $0.42 to $0.47. In summary, we continue to be confident with respect to the industry and our own prospects for the future.

綜合來看，我們預計第三季銷售額將在 3.85 億美元至 4 億美元之間，GAAP 每股收益預計為 0.29 美元至 0.34 美元，非 GAAP 每股收益預計為 0.42 美元至 0.47 美元。總而言之，我們對產業前景和自身未來發展前景依然充滿信心。

Operator, we'll now take questions.

操作員，現在開始接受提問。

(Operator Instructions) We will now take our first question from Toshiya Hari with Goldman Sachs.

（操作員說明）現在我們來回答來自高盛的 Toshiya Hari 的第一個問題。

I had 3, if I may. First, in terms of the operating model improvements that you guys talked about, I was hoping you could elaborate a little bit more in terms of what you're doing exactly perhaps by segment or product line to the extent possible and kind of the split between COGS and OpEx. That will be my first question.

如果可以的話，我有3個。首先，關於你們提到的營運模式改進，我希望你們能更詳細地說明一下你們具體在做什麼，最好能按部門或產品線來說明，以及銷售成本和營運支出之間的劃分。這將是我的第一個問題。

Yes. So Toshiya, let me give you maybe a high-level context for what we're trying to do here, which is really part of the broad strategic initiatives that we started in the fall of last year and that we've put on hold during the merger discussion with Versum. So as a company, we're always looking at ways to improve our operational efficiency, improve our customer intimacy. And what we really want to do is to make sure that we can find ways to reduce our time to solution and ways to more closely align our development and engineering teams with our customer-facing teams. So you should expect actually the reorganization to have an impact across multiple financial statement lines, most notably in SG&A, but it will really impact each of the 3 divisions. And the whole idea behind that, again, is to make us more responsive to customers, more competitive and also allow us to be more effective in integrating future acquisitions.

是的。所以 Toshiya，讓我給你介紹一下我們正在努力的方向，這實際上是我們去年秋天啟動的廣泛戰略計劃的一部分，但在與 Versum 進行合併討論期間，我們暫停了這些計劃。因此，作為一家公司，我們一直在尋找提高營運效率、增進客戶關係的方法。我們真正想要做的，是確保我們能夠找到縮短解決方案所需時間的方法，以及讓我們的開發和工程團隊與面向客戶的團隊更加緊密地合作的方法。因此，您應該預料到此次重組實際上會對多個財務報表項目產生影響，最顯著的影響是銷售、一般及行政費用，但它確實會對這 3 個部門中的每一個都產生影響。而這一切背後的理念，再次強調，是為了讓我們能夠更迅速地回應客戶需求，更具競爭力，並使我們能夠更有效地整合未來的收購項目。

Got it. And then my second question is on the second half outlook. Bertrand, you talked about setting pretty conservative assumptions for the broader market and more kind of relying on company-specific drivers, and I think that's consistent with what you had said 3 months ago. But curious what sort of assumptions have you embedded in your second half numbers or your full year guide, both in terms of wafer starts as well as CapEx in the second half perhaps relative to the first half. And then more on the company-specific stuff. If you can remind us what the goals are in terms of some of the product line that you talked about 3 months ago, like graphite, specialty coatings, some of the node transitions by your customers and things like that.

知道了。我的第二個問題是關於下半年的展望。伯特蘭，你談到要對更廣泛的市場設定相當保守的假設，更多地依賴於公司特定的驅動因素，我認為這與你3個月前所說的是一致的。但我很好奇，你們在下半年的數據或全年預測中都包含了哪些假設，包括晶圓開工量以及下半年相對於上半年的資本支出。然後是更多關於公司具體情況的內容。如果您能提醒我們一下，您在 3 個月前談到的一些產品線的目標是什麼，例如石墨、特種塗料、您的客戶的一些節點過渡等等。

Yes. So let me start with some of the industry assumptions that we used for the second half of the year. And as you said, we are using what I think is a set of fairly conservative assumptions, we expect MSI to be flat in the second half of the year versus the first half. We expect CapEx to continue to slide. And to put that in a quantitative form, I would say, CapEx down probably another 9% in the second half versus the first half. So a lot of the growth that we expect to generate in the back end of the year will come from node transitions. And we have felt a little bit of that already in Q1 of this year. We expect to see actually additional momentum in logic and foundry in the back end of the year. We also expect to see the benefit of a number of memory customers transitioning to additional layers in the back end of the year. So the impact will be felt mostly in microcontamination and SCEM. And as you mentioned, it's going to be specialty coating, deposition materials, selective etch chemistries as well as advanced liquid filtration solutions.

是的。那麼，讓我先從我們針對下半年產業所做的一些假設開始說起。正如您所說，我們採用了一套我認為相當保守的假設，我們預計下半年 MSI 的業績將與上半年持平。我們預計資本支出將持續下滑。用量化的方式來說，我認為下半年資本支出可能比上半年再下降 9%。因此，我們預計今年下半年的大部分成長將來自節點遷移。今年第一季我們已經感受到了一些這種影響。我們預計今年下半年邏輯晶片和晶圓代工領域將出現更大的成長動能。我們也預計，在今年下半年，許多記憶體客戶將過渡到額外的記憶體層，這將帶來收益。因此，其影響主要體現在微污染和SCEM方面。正如您所提到的，它將涉及特種塗層、沉積材料、選擇性蝕刻化學以及先進的液體過濾解決方案。

Great. And then my last one. In terms of some of the geographical information that you give out in your deck, I was positively surprised by how Korea kind of hung in, and I was negatively surprised by how weak Taiwan was in Q2 on a sequential basis. I would have thought, given customer commentary, in memory, I would have expected weaker performance in Korea. And then on the flip side, given the largest foundry customers' comments in the Q3, I would have expected better trends in Taiwan. So if you can kind of comment on both regions, what went on during the quarter and what the outlook was into the second half.

偉大的。然後是我的最後一個。就你在簡報中提供的一些地理資訊而言，我對韓國的表現感到驚喜，對台灣在第二季度環比表現疲軟感到失望。根據客戶的回饋，我原本以為韓國市場的表現會比較弱。另一方面，考慮到第三季最大的代工廠客戶的評論，我原本預期台灣的趨勢會更好。所以，如果您能對這兩個地區的情況做一些評論，說說本季發生了什麼，以及對下半年的展望，那就太好了。

Sure. So let's start with Korea. So Korea, sequentially good performance. We saw a stabilization of level of affectivity in the memory fabs, so no further deterioration, which was good. And we picked up actually some activity on new fab construction in Korea. So that's really what explains the relatively good performance in Q2, given the overall industry context. We expect the picture to continue to improve in the back end of the year as we expect some modest improvement in fab activity and memory in Korea. In the case of Taiwan, if you look at the first half performance, we are growing actually 6% organically in Taiwan, first quarter of this year compared to first quarter of last year. So that's what I would have expected. We knew that we benefited from a number of unusually high orders in Q1 related to a number of ramps and tape-out activity. And as we said in our Q1 results, we really were expecting a softening in microcontamination, in particular, sequentially, and we saw that in Taiwan. Going forward in Taiwan, we expect a big reacceleration in the back end of the year, and we expect Taiwan to have a very, very solid year for us.

當然。那我們就從韓國開始吧。所以韓國，連續幾屆表現都不錯。我們看到記憶工廠的情感水平趨於穩定，沒有進一步惡化，這是好事。我們也了解到韓國正在進行一些新的工廠建設活動。所以，考慮到整個產業的情勢，這就能解釋第二季相對較好的表現了。我們預計，隨著韓國晶圓廠活動和記憶體業務出現小幅成長，下半年市場狀況將繼續好轉。以台灣為例，如果你看一下上半年的業績，我們今年第一季在台灣的有機成長率實際上達到了 6%，與去年第一季相比。所以這跟我預想的一樣。我們知道，第一季我們受益於一些與產能爬坡和流片活動相關的異常高的訂單量。正如我們在第一季業績報告中所說，我們確實預期微污染會有所緩解，特別是按季度來看，我們在台灣也看到了這一點。展望台灣市場，我們預計今年下半年將大幅回升，並預計台灣市場今年將迎來非常非​​常穩健的一年。

We'll now take our next question from Sidney Ho with Deutsche Bank.

接下來，我們將回答來自德意志銀行的 Sidney Ho 提出的問題。

My first question is, I appreciate you reaffirming your full year guidance of $1.6 billion. So based on your Q3 guidance of what implies a pretty healthy rebound of sales in Q4 of at least 10% and EPS of 55% or more, can you maybe walk us through -- I know you talk about Q3 dynamics, but what exactly is driving the Q4 growth assumptions there?

我的第一個問題是，感謝您重申全年業績預期為 16 億美元。根據您第三季的業績指引，第四季度銷售額將出現相當健康的反彈，至少增長 10%，每股收益將增長 55% 或更多，您能否為我們詳細解釋一下——我知道您談到了第三季度的動態，但究竟是什麼因素推動了第四季度的增長假設？

So Sidney, I would probably reiterate what I was just saying, answering Toshiya's question. It's all about the node transitions. We expect additional momentum coming from that, both in logic as well as in memory. That will primarily impact positively the microcontamination and SCEM businesses, and you should expect sequential increase or increases in Q3 and then in Q4 for both of those divisions.

所以西德尼，我大概會重申我剛才說的話，回答俊也的問題。一切都與節點轉換有關。我們預計這將帶來額外的發展動力，無論是在邏輯領域還是記憶體領域。這將主要對微污染和供應鏈管理業務產生積極影響，預計這兩個部門在第三季和第四季將出現環比增長。

Okay. That's helpful. Maybe switching to the gross margin, the gross margin, obviously, in Q2 was a little challenging, and I think you guys talked about the year-over-year decline. I'm just trying to understand the quarter-over-quarter decline as well. And is that kind of seen across the different segments? And related to that, Q3 is going back to 46%. What's driving the recovery of that on a sequential basis?

好的。那很有幫助。或許可以換算成毛利率，顯然，第二季的毛利率有點​​難以衡量，我想你們也談到了同比下降的情況。我也想了解季度季減的原因。這種現像在各個細分市場中是否普遍存在？與此相關的是，Q3 將回落至 46%。是什麼因素推動了這趨勢的持續復甦？

Yes. I can let Greg potentially add some more financial details to your question, but before he does that, I'd like to provide maybe some high-level perspective and what I want you to appreciate is that some time halfway into the quarter, so say, mid- to late May, we realized that the environment would be a little bit softer than expected and then we also realized that the mix would not be very favorable in Q2. So in other words, we realized in May that we would most likely be testing the low-end of our EPS guidance. So as a management team, we looked at our options. We considered slamming the brakes. But in the end, we decided not to do that. And instead what we tried to do is really to curb some discretionary spendings. But again, we chose not to really flex down the labor cost, SG&A or R&D. And I really think it was the right decision.

是的。我可以請 Greg 補充一些關於您問題的財務細節，但在他補充之前，我想先提供一些宏觀的視角。我想讓您明白的是，大約在季度中期，也就是五月中下旬，我們意識到市場環境會比預期略微疲軟，而且我們也意識到第二季的市場組合不會很有利。換句話說，我們在 5 月意識到，我們很可能要測試每股盈餘預期的下限。因此，作為管理團隊，我們考慮了各種方案。我們考慮過猛踩煞車。但最終，我們決定不這麼做。相反，我們試圖真正控制一些可自由支配的支出。但我們仍選擇不真正降低勞動成本、銷售、一般及行政費用或研發費用。我真的認為這是一個正確的決定。

So why was that the right decision? Well, first, if you think about margin and cost of goods sold, we were getting in May and, of course, today, we even have further evidence that the back end of the year will be very strong for Entegris. So we felt that it would have been very foolish to flex down our direct labor in the plans in Q2 only to have to rehire and retrain workers a few months later. So that's the way I would answer your gross margin question. But to extend my comment to other parts of the P&L, I would say that we also chose to continue to spend in R&D. I mean our development teams have been working very closely with customers on a number of promising opportunities, and it was very important for us to allow proper funding, both in CapEx and in R&D, which we did in order to continue to increase the quality of the opportunity pipeline. So it's not -- don't get me wrong, it's not pleasant not to deliver on an EPS number and to be slightly below the guidance, but in this particular instance, it was a calculated choice, and I think it was the right choice.

那麼，為什麼說那是正確的決定呢？首先，如果你考慮毛利率和銷售成本，我們五月的業績，當然還有今天，我們甚至有進一步的證據表明，Entegris 今年下半年的業績將會非常強勁。因此，我們認為在第二季度削減直接勞動力投入，幾個月後又不得不重新僱用和培訓工人，是非常愚蠢的。這就是我對你提出的毛利率問題的回答。但要將我的觀點擴展到損益表的其他部分，我想說，我們也選擇繼續在研發上投入資金。我的意思是，我們的開發團隊一直在與客戶密切合作，尋找許多有前景的機會，對我們來說，提供充足的資金（包括資本支出和研發資金）非常重要，我們也確實這樣做了，以便繼續提高機會管道的品質。所以，別誤會我的意思，未能達到每股收益預期，略低於預期，這當然令人不快，但就目前的情況而言，這是一個經過深思熟慮的選擇，我認為這是一個正確的選擇。

Yes. And, Sidney, just to follow up your question, the decline really was across divisions. Our volumes were down in 2 of the 3 divisions and then the third division, which would be SCEM, our volumes were up. We were impacted more by mix.

是的。西德尼，我再回答一下你的問題，這種下滑確實是各部門都會出現的。我們三個部門中有兩個部門的銷售量下降了，而第三個部門（即 SCEM）的銷售量卻上升了。我們受到的混合影響更大。

Okay. Great. Thanks for the color. That's great. Maybe one last question for me. In terms of the MPD Chemicals acquisition, how much should we expect the revenue contribution from them in Q3? And Greg, when you talk about accretion next year, what magnitude of accretion are you kind of expecting?

好的。偉大的。謝謝你提供的色彩。那太棒了。我可能還有一個問題。就MPD Chemicals的收購而言，我們應該預期該公司在第三季能貢獻多少營收？格雷格，當你談到明年的吸積量時，你預計吸積量會有多大？

Yes. So we would expect next -- in Q3, we would expect revenue to be in the high single digits. We don't own it for the whole of the quarter. And when we think about accretion next year, we think about $0.05 to $0.10 per share.

是的。因此，我們預計第三季營收將達到較高的個位數。我們並非整個季度都擁有它。當我們考慮明年的增幅時，我們認為每股增幅在 0.05 美元到 0.10 美元之間。

(Operator Instructions) We will now take our next question from Amanda Scarnati with Citi.

（操作員指示）現在我們來回答花旗銀行的阿曼達·斯卡納蒂提出的下一個問題。

Just wanted to talk a little bit about the China business. It looked like it was up quite a bit in the second quarter. But I've been hearing a lot lately that China is increasingly tying subsidies or incentivizing subsidies to use sort of non-U. S. suppliers. Have you been seeing any of that in the market? And sort of what drove that strong growth in China this quarter?

想簡單談談中國業務。第二節比賽看起來漲幅相當大。但我最近常聽到，中國越來越多地將補貼或激勵補貼與使用某種非美國產品掛鉤。美國供應商。你在市場上看過這類產品嗎？那麼，是什麼因素推動了中國本季的強勁成長呢？

Amanda, so let me just say that our business has not really been directly impacted by any of the trade tensions or export restrictions, and we don't expect that to be the case going forward. So what drove the nice sequential growth is really a number of new wins at actually some of our large Chinese domestic fab customers. So very, very pleased to see that we've been able to find ways to continue to engage with domestic Chinese fab customers and continue to win new business in spite of being a U.S. supplier. So I agree with you that there is a long-term risk that you characterize that some of the Chinese fab customers may choose to lessen their reliance on U.S. suppliers. But as of right now, we have not seen any of that impact meaningfully our business.

阿曼達，我只想說，我們的業務並沒有真正受到任何貿易緊張局勢或出口限制的直接影響，我們預計未來也不會如此。因此，推動業績穩定成長的真正原因是我們在一些大型中國國內晶圓廠客戶那裡贏得了一些新的訂單。非常非常高興地看到，儘管我們是一家美國供應商，但我們仍然能夠找到方法繼續與中國國內晶圓廠客戶保持聯繫，並繼續贏得新業務。所以我同意你的觀點，即存在你所描述的長期風險，一些中國晶圓廠客戶可能會選擇減少對美國供應商的依賴。但就目前而言，我們還沒有看到這些對我們的業務產生任何實質影響。

And then just going back to the margin question. As you sort of worked through your due diligence with the Versum acquisition, did you notice anything different in how they approach margins in different ways in which you can sort of expand your EBITDA margins? I know you talked today about a little bit of restructuring that you're doing, but is there anything in there that could be something longer term that you could work on in your model?

然後我們再回到利潤率的問題上。在您進行 Versum 收購的盡職調查過程中，您是否注意到他們在利潤率方面有什麼不同之處，例如他們採取了不同的方法來擴大您的 EBITDA 利潤率？我知道你今天談到了一些正在進行的重組，但其中是否有一些可以作為長期發展方向的措施，供你在模式中改進？

Amanda, I think we've implied before we certainly learned some things out from a competitive perspective but around sort of business process and organization. And I think some of what we announced today and Bertrand has already talked about would be a byproduct of that. As it relates to the gross margin, specifically, I would say, we didn't really learn anything specific. I mean I feel good about how we execute and how we manage our gross margin line, more specifically how our team manages the supply chain in the factories.

阿曼達，我想我們之前已經暗示過，我們確實從競爭的角度學到了一些東西，但主要是關於業務流程和組織方面。我認為我們今天宣布的一些內容，以及伯特蘭已經談到的一些內容，都是由此產生的副產品。就毛利率而言，具體來說，我認為我們並沒有真正學到任何具體的東西。我的意思是，我對我們的執行方式以及毛利率管理感到滿意，更具體地說，我對我們團隊在工廠的供應鏈管理感到滿意。

We will now take our next question with Chris Kapsch from Loop Capital Markets.

接下來，我們將向來自 Loop Capital Markets 的 Chris Kapsch 提問。

I just had really a follow-up on formal comments that, Bertrand, you had about sort of witnessing an inflection of sorts or stabilization of orders. I'm just wondering if you could characterize that by either fab, foundry, logic, memory, just any sort of characterization about why you feel that there is some evidence of inflection, any sort of color around that. Then I have one follow-up.

伯特蘭，我只是想對你之前關於見證某種轉折或秩序穩定化的正式評論做一些後續跟進。我只是想知道，您能否從製造、代工、邏輯、內存等方面來描述一下，或者用任何方式來描述一下您為什麼覺得存在某種轉變的跡象，或者說，能否描述一下這方面的情況。我還有一個後續問題。

Yes. So usually, the greater level of visibility that we have is directly related to those node transitions. So -- and we are seeing that in advanced logic and foundry and in advanced memory. The other area, which was actually a very important signal that we've been waiting to see, is really in our CapEx-driven business. And across all of our CapEx-driven business lines, we are actually seeing very, very healthy book-to-bill ratios. And that's the first time in a very long time. So in other words, we believe that we are no longer trying to catch a falling knife on that part of our business, and that gives us a lot more comfort for what's ahead.

是的。因此，通常情況下，我們所擁有的更高可見度與這些節點轉換直接相關。所以——我們在先進的邏輯和晶圓代工以及先進的記憶體中都看到了這一點。另一個領域，實際上是我們一直期待看到的非常重要的訊號，那就是我們以資本支出為驅動的業務。在我們所有以資本支出為驅動的業務線中，我們實際上都看到了非常非常健康的訂單出貨比。這是很久以來的第一次。換句話說，我們相信我們不再需要冒險去應對業務中的這一部分，這讓我們對未來更有信心。

Okay. That's helpful. And then just the follow-up is on the sequential rebound that you're suggesting you see in margins and sort of maybe your -- the answer to my other question sort of explains that, but is it just a function of the node transitions driving demand for advanced products that's helping margins sequentially and continued weakness in some of the equipment side? Or if you could just provide some color there.

好的。那很有幫助。然後，接下來我想問的是，您提到的利潤率的連續反彈，以及您——我另一個問題的答案已經解釋了這一點——但這僅僅是節點轉換推動了對先進產品的需求，從而幫助利潤率連續增長，以及某些設備方面持續疲軟的結果嗎？或者，如果你能給那裡加點顏色就更好了。

The sequential improvement in the margin really, Chris, is we expect things to return to a more normalized level in terms of both mix, and we expect some moderate increase in the volumes. So if you look at -- if you look over the last 6 quarters or so, I mean, we've been right -- with the exception of early last year where we had some peak margins, we've been right at about 46%. There is nothing systemic on the margins. Our ASP trends are good. We continue to execute well. So it really boils down to continuing to see some improvement in mix and some better volumes.

克里斯，利潤率的持續改善，實際上意味著我們預計產品組合將恢復到更正常的水平，同時銷售也將出現適度成長。所以如果你看看——如果你看看過去 6 個季度左右的情況，我的意思是，我們一直都是對的——除了去年年初我們利潤率達到峰值的時候，我們的利潤率一直都在 46% 左右。邊緣地帶並沒有什麼系統性問題。我們的平均售價趨勢良好。我們繼續保持良好的執行力。所以歸根究底，就是要繼續看到混音的改進和音量上的提升。

We will now take our next question from Patrick Ho with Stifel.

接下來，我們將回答來自 Stifel 的 Patrick Ho 提出的問題。

Maybe first up for you, Bertrand. In terms of the materials intensity for logic and foundry, it's clear that their new device structures, the smaller line which are driving more materials engineering. Can you give a little bit of color on whether you're seeing new materials used in either advanced deposition action areas like that? Or is it just that the content for existing materials has increased at some of these new node shrinks?

或許第一個輪到你了，伯特蘭。就邏輯和代工的材料強度而言，很明顯，他們的新裝置結構，更小的生產線，正在推動更多的材料工程。您能否簡要介紹一下，您是否看到在先進沉積製程領域中使用了新材料？或者只是因為在某些新的節點尺寸縮小後，現有材料的內容增加了？

So Patrick, this is actually -- we are seeing both. We are seeing greater materials intensity as a result of greater gate density in the new architectures, but we also -- I mean the material intensity is also defined by the introduction of new highly engineered materials. That is certainly an area where we see growth far exceeding the industry growth. This is an area where we have the objective of establishing Entegris as a leading supplier, and that's really what has led us to the acquisition of DSC and MPD. We wanted to increase our capabilities in that area. We wanted to have access to high-volume manufacturing synthesis capabilities. We wanted to take greater control on our supply chain. We wanted to be in a position to purify the materials that we are supplying to our customers and really offer to our customers a very complete series of capabilities from synthesis to purification and delivery of those new materials, all of which present daunting challenges that I believe Entegris will be uniquely positioned to solve. So again, what we're seeing on the logic side of things in terms of industry road map is very, very exciting. What we're seeing on the memory side is also equally exciting, and that's why we are so focused on those opportunities.

所以派崔克，實際上——我們兩種情況都看到了。由於新架構中閘極密度的增加，我們看到材料強度也隨之增加，但同時——我的意思是，材料強度也是由新引入的高工程材料決定的。這無疑是一個成長速度遠超過行業平均值的領域。在這個領域，我們的目標是將 Entegris 打造成領先的供應商，而這正是我們收購 DSC 和 MPD 的原因。我們希望提升我們在該領域的能力。我們希望獲得大規模生產合成能力。我們希望能更好地掌控供應鏈。我們希望能夠提純我們提供給客戶的材料，並真正為客戶提供從合成到提純和交付這些新材料的非常完整的服務能力，所有這些都帶來了艱鉅的挑戰，但我相信 Entegris 將擁有獨特的優勢來解決這些挑戰。所以，從產業路線圖的角度來看，我們在邏輯上看到的一切都非常令人興奮。我們在儲存方面看到的情況同樣令人興奮，這也是我們如此關注這些機會的原因。

Great. That's helpful. And maybe, Greg, as my follow-up question in terms of the new investments. You guys continue to make -- I mean a stronger play on that front, which has led to a lot of these new products that are now starting to pay dividends. How do you look at R&D spending over the next year or so in terms of, I guess, future product development and opportunities that are still forthcoming with future years, particularly on the material side of things?

偉大的。那很有幫助。格雷格，或許我可以就新的投資提出後續問題。你們繼續加強——我的意思是，你們在這方面投入了更多資源，這催生了許多新產品，而這些產品現在開始帶來回報。您如何看待未來一年左右的研發支出，我想，這關係到未來的產品開發以及未來幾年仍然存在的機會，尤其是在材料方面？

Yes. So first of all, I would just say, on ER&D, all of our -- any project of any significance has an ROI attached to it. And I mean, it's a very sort of analytically driven approach in terms of where we invest our ER&D dollars. I think I said as part of the capital allocation discussion, I mean, we were at 8% of revenue in the most recent quarter. We've been trending sort of around that 7% level. Our commitment going forward is to be in that 8-ish range. So -- and if you look at our OpEx year-over-year, we've been pretty consistent on the ER&D front. I mean in terms of -- that's the lifeblood of the company. So I think you can expect us to continue to prioritize spending on the ER&D even as we make adjustments in other areas.

是的。首先，我想說的是，在研發方面，我們所有的——任何重要的項目都與投資報酬率有關。我的意思是，我們在研發資金的投資方向方面，採取的是一種非常注重分析的方法。我想我在討論資本配置時說過，我的意思是，在最近一個季度，我們的營收佔比為 8%。我們一直徘徊在7%左右。我們未來的目標是保持在 8 左右的水平。所以——如果你看一下我們每年的營運支出，我們在研發方面一直相當穩定。我的意思是，就公司而言──那是公司的命脈。因此，我認為您可以預期，即使我們在其他領域進行調整，我們仍將繼續優先考慮對研發領域的投入。

We'll now take our next question from David Silver with CL King.

接下來，我們將回答大衛·西爾弗和CL·金提出的問題。

I guess a couple of questions. First one would just be kind of on a baseline. So I think, Bertrand, you mentioned that you expect second half of 2019 to be flat sequentially with the first half in terms of MSI. I don't recall, but could you just clarify what your expectations are for the first half, in other words, what the baseline for the first half might be, whether it's MSI or wafer starts or whatever you consider the relevant metric?

我想問幾個問題。第一個只是作為基準。所以，伯特蘭，你提到你預計 2019 年下半年 MSI 的表現將與上半年持平。我不記得了，但您能否澄清一下您對上半年的期望是什麼？換句話說，上半年的基準是什麼？無論是 MSI 還是晶圓開工量，或是您認為相關的任何指標？

Right. So the first half of '19 compared to the first half of '18, MSI was down about 2% as per our estimates, and CapEx was down about 12% as per our estimates. Is that your question, David?

正確的。因此，根據我們的估計，2019 年上半年與 2018 年上半年相比，MSI 下降了約 2%，資本支出下降了約 12%。這就是你的問題嗎，大衛？

Yes. Just wondering how you're looking at the market. So thank you for that clarification. And then the second thing, I did -- excuse me, go ahead.

是的。想了解一下您對市場的看法。非常感謝您的澄清。然後，我做了第二件事——不好意思，請繼續。

No. So I was just maybe trying to provide a slightly different perspective on our full year 2019 guidance. I mean we are assuming strong industry headwinds to the tune of minus 8% year-over-year, so '19 over '18. And you get there with the assumption that CapEx will be down into high teens year-over-year and MSI will be down 3% to 4% year-over-year. So to offset that, we expect to pick up about 600 basis point from a number of acquisitions that we did over the last 12 months and then we expect to generate about 500 basis point of organic growth in excess of the industry. So the only thing that has changed really between this quarter and last quarter is the view that the market and the industry is probably a little bit weaker than we were estimating a few months back.

不。所以，我只是想就我們 2019 年全年業績指引提供一個略有不同的視角。我的意思是，我們假設產業將面臨強勁的逆風，年減 8%，即 2019 年比 2018 年下降 8%。得出這個結論的前提是，資本支出年比將下降十幾個百分點，而微服務收入則是年減 3% 至 4%。為了彌補這一損失，我們預計過去 12 個月內完成的一系列收購將帶來約 600 個基點的成長，然後我們預計有機成長將超過業界平均約 500 個基點。因此，本季與上季之間真正的唯一變化是，我們認為市場和產業可能比幾個月前我們估計的要疲軟一些。

Well, no, that's interesting. And just a quick follow-up but the 500 basis points of organic growth above the market baseline, that's higher than your traditional targets, I guess, your longer-term targets for your overall business mix. Is that correct?

嗯，不，這很有趣。最後再補充一點，500 個基點的有機成長高於市場基準，這高於你們的傳統目標，我想，也高於你們整體業務組合的長期目標。是這樣嗎？

That's correct. Our long-term target would be 200 to 300 basis points over the industry. We expect we will be actually beating that target, which is something you would expect us do to given the number of node transitions that we are seeing this year.

沒錯。我們的長期目標是比產業平均高出 200 至 300 個基點。我們預計實際上會超過這個目標，考慮到我們今年看到的節點轉換數量，這也在情理之中。

Yes. That was more than I anticipated. Appreciate it. I wanted to ask a quick question maybe for Greg, and I hope I'm not too confusing, but you laid out your M&A criteria very clearly, and I wanted to focus on accretion with this year's 2 acquisitions, I guess, Digital and MPD. And so more than $200 million of CapEx and -- sorry, of expenditure. And I'm assuming -- or should I assume that the combination of those 2 will be accretive over the next 12 months? And then I also would ask you to maybe parse the $20 million of cost savings. In other words, would the acquisitions be accretive ex the implementation of the $20 million in annualized cost savings? Or is that inclusive, I mean, in other words, is there a little double counting there to -- does a meaningful portion of the anticipated efficiencies come from integrating MPD and Digital? Or is it more broad-based and they would be accretive and meet your targets on a stand-alone basis?

是的。這比我預想的要多。謝謝。我想問 Greg 一個問題，希望我的問題不會太困惑。您已經非常清楚地闡述了您的併購標準，我想專注於今年的兩項收購（Digital 和 MPD）帶來的收益成長。因此，資本支出和——抱歉，是支出——超過了 2 億美元。我假設——或者我應該假設——這兩項措施結合起來將在未來 12 個月內產生增值效應？然後，我也想請您分析一下這 2000 萬美元的成本節約情況。換句話說，如果排除每年節省 2,000 萬美元成本的可能性，這些收購是否會帶來收益成長？或者說，這是否包含所有因素？換句話說，是否存在一些重複計算？預期效率的很大一部分是否來自 MPD 和數位技術的整合？或者，它們的基礎更廣泛，能夠獨立地增加收益並達到您的目標？

Yes. They are really 2 very kind of discrete events or projects, so to speak. With regard to MPD, we had the question a little bit earlier, and we said $0.05 to $0.10 accretive in 2020. So we would expect -- I mean DSC is a much smaller transaction, but we would expect that to be accretive in 2020 as well.

是的。它們實際上是兩個非常獨立的事件或項目。關於 MPD，我們之前已經討論過這個問題，我們當時說 2020 年將增加 0.05 至 0.10 美元。因此我們預計——我的意思是，DSC 是一筆規模小得多的交易，但我們預計它在 2020 年也會帶來收益。

We'll now be taking our last question from Krish Sankar with Cowen and Company.

現在我們將回答來自 Cowen and Company 的 Krish Sankar 提出的最後一個問題。

I had a few of them. First one, Bertrand, do you guys break out your revenue by end customer type like DRAM, NAND, logic, et cetera?

我有一些。首先，Bertrand，你們公司是否會按終端客戶類型（例如 DRAM、NAND、邏輯晶片等）細分收入？

No, we don't do that with a very high degree of precision. We have given some directional perspective to that, but we don't do that on a quarterly basis.

不，我們做這件事的精確度並不高。我們已經對此給出了一些方向性展望，但我們不會按季度進行展望。

Got it. Got it. That is fine. And then how much of the weakness you saw in Q2 was related to some of your memory customers throttling back wafers?

知道了。知道了。沒問題。那麼，您在第二季度看到的疲軟表現中，有多少是由於部分記憶體客戶減少晶圓產量造成的？

So it wasn't really coming from our memory customers directly, but we saw some indirect impact from their supply chains, particularly by chemical manufacturers lowering their production levels and that had an impact on both our pure drums and that's AMH, but also sales of some liquid filters and that would be MC. So those -- and that's something that we have not really probably well forecasted going into Q2.

所以，這實際上並不是直接來自我們的記憶體客戶，而是來自他們的供應鏈的一些間接影響，特別是化學品製造商降低產量，這不僅影響了我們的純桶（即 AMH），也影響了一些液體過濾器（即 MC）的銷售。所以，這些——而這或許是我們在第二季之前沒有做出準確預測的事情。

Got it. Got it. And then the last question, Bertrand, is some of your customers -- memory customers are talking about moving wafers from DRAM into CMOS image sensors. If they do such a thing, is that good, bad or is it agnostic for Entegris?

知道了。知道了。最後一個問題，伯特蘭，你的一些客戶——記憶體客戶正在討論將晶圓從DRAM轉移到CMOS影像感測器。如果他們這樣做，這對 Entegris 來說是好事、壞事還是無關緊要？

I think it's a case-by-case answer, and I wouldn't want to go into customer specifics, but you should not be worried about those types of rumors.

我認為這要視具體情況而定，我不想透露客戶的具體情況，但您不必擔心這類謠言。

That is all the time we have for questions. I'd like to turn the conference back over to the presenters for any additional or closing remarks.

我們提問時間到此結束。我想把會議交還給各位演講者，讓他們再作補充或總結發言。

That will be it for today. Thank you for joining the call. Have a great day.

今天就到這裡。感謝您參加通話。祝你有美好的一天。

This concludes today's call. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線了。