FormFactor Inc (FORM) 2018 Q3 法說會逐字稿

Thank you, and welcome, everyone, to FormFactor's Third Quarter 2018 Earnings Conference Call. On today's call are Chief Executive Officer, Mike Slessor; and Chief Financial Officer, Shai Shahar.

謝謝，歡迎大家參加 FormFactor 2018 年第三季度收益電話會議。參加今天電話會議的有首席執行官 Mike Slessor；和首席財務官 Shai Shahar。

Before we begin, Jason Cohen, the company's General Counsel will remind you of some important information.

在開始之前，公司總法律顧問 Jason Cohen 將提醒您一些重要信息。

Thank you. Today, the company will be discussing GAAP P&L results and some important non-GAAP results intended to supplement your understanding of the company's financials. Reconciliations of GAAP to non-GAAP measures and other financial information are available in the press release issued today by the company and on the Investor Relations section of our website.

謝謝。今天，公司將討論 GAAP P&L 結果和一些重要的非 GAAP 結果，旨在補充您對公司財務狀況的理解。公司今天發布的新聞稿和我們網站的投資者關係部分提供了 GAAP 與非 GAAP 措施和其他財務信息的調節。

Today's discussion contains forward-looking statements within the meaning of the federal securities laws. Examples of such forward-looking statements, include those with respect to the projections of financial and business performance; future macroeconomic conditions; foreign exchange rates; business momentum; business seasonality; the anticipated demand for products; customer requirements; our future ability to produce and sell products; the development of future products and technologies; and the assumptions upon which such statements are based.

今天的討論包含聯邦證券法含義內的前瞻性陳述。此類前瞻性陳述的示例包括與財務和業務績效預測相關的陳述；未來的宏觀經濟狀況；外匯匯率；業務勢頭；業務季節性；對產品的預期需求；客戶要求;我們未來生產和銷售產品的能力；未來產品和技術的開發；以及此類陳述所依據的假設。

These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed during this call. Information on risk factors and uncertainties is contained in our most recent filing on Form 10-K with the SEC for the fiscal year ended 2017 and our other SEC filings, which are available on the SEC's website at www.sec.gov and in our press release issued today. Forward-looking statements are made as of today, October 31, 2018, and we assume no obligation to update them.

這些陳述受到已知和未知的風險和不確定性的影響，這些風險和不確定性可能導致實際結果與本次電話會議中表達的結果存在重大差異。關於風險因素和不確定性的信息包含在我們最近向美國證券交易委員會提交的截至 2017 財年的 10-K 表格以及我們向美國證券交易委員會提交的其他文件中，這些文件可在美國證券交易委員會網站 www.sec.gov 和我們的媒體上查閱今天發布。前瞻性陳述截至今天，即 2018 年 10 月 31 日，我們不承擔更新它們的義務。

With that, we will now turn the call over to FormFactor's CEO, Mike Slessor.

有了這個，我們現在將把電話轉給 FormFactor 的首席執行官 Mike Slessor。

Thanks, Jason, and thank you, everyone, for joining us today. As we anticipated during last quarter's conference call, FormFactor delivered third quarter results comparable to our second quarter on the top and bottom lines. The expected gross margin reduction due to product mix was mostly offset by good operating expense control, enabling us to deliver non-GAAP earnings per share at the high end of our outlook.

謝謝杰森，也謝謝大家今天加入我們。正如我們在上一季度的電話會議中預期的那樣，FormFactor 交付的第三季度業績與我們第二季度的最高和最低業績相當。由於產品組合導致的預期毛利率下降大部分被良好的運營費用控制所抵消，使我們能夠在我們的展望高端實現非 GAAP 每股收益。

And as you saw from our press release earlier today, we expect a modest sequential increase in fourth quarter revenue. Given the volatile industry backdrop in a quarter that is often seasonally weak, these healthy results and outlook are a direct demonstration of our leadership across attractive served markets in advanced probe cards and engineering systems.

正如您今天早些時候從我們的新聞稿中看到的那樣，我們預計第四季度收入將出現適度的環比增長。考慮到一個季度的動盪行業背景通常是季節性疲軟的，這些健康的結果和前景直接證明了我們在先進探針卡和工程系統的有吸引力的服務市場中的領導地位。

A primary driver of our financial performance is the structural demand for FormFactor's products and technologies. As we described in the past, probe cards are a consumable that is specific to each and every new IC design. As a result, we benefit from both node transitions and the release of new designs on existing mature nodes. With the stalling of Moore's Law, our opportunities on mature nodes are especially important, providing demand even when new nodes are delayed, an event we saw twice with major customers this year.

我們財務業績的主要驅動力是對 FormFactor 產品和技術的結構性需求。正如我們過去所描述的，探針卡是一種特定於每一種新 IC 設計的消耗品。因此，我們受益於節點轉換和在現有成熟節點上發布新設計。隨著摩爾定律的停滯，我們在成熟節點上的機會尤為重要，即使在新節點延遲的情況下也能提供需求，這是我們今年與主要客戶看到的兩次事件。

Our third quarter results offer a strong example of this demand for probe cards on existing nodes, as our largest customer released several new designs on their 14-nanometer node, which is now nearly 5 years old. This new design activity resulted in third quarter volumes to return to the levels we delivered in the first half of 2017, and in the current quarter, we expect the strong 14-nanometer activity to continue.

我們第三季度的業績很好地說明了現有節點對探針卡的需求，因為我們最大的客戶在他們的 14 納米節點上發布了幾個新設計，該節點現在已有近 5 年的歷史。這一新的設計活動導致第三季度的銷量恢復到我們在 2017 年上半年交付的水平，而在本季度，我們預計強勁的 14 納米活動將繼續。

We also benefit from node transitions, of course. And we expect to generate demand as our largest customer transitions to 10-nanometer production, an event which we continue to expect in 2019.

當然，我們也受益於節點轉換。隨著我們最大的客戶向 10 納米生產過渡，我們預計會產生需求，這是我們在 2019 年繼續期待的事件。

More immediately, we are currently benefiting from other customers' node transitions in Foundry and Logic, with our fourth quarter outlook supported by initial 7-nanometer production volume at the world's leading foundry. As we've discussed in the past, the cornerstone of this expanding relationship is FormFactor's proprietary MEMS-based probe technology and the differentiated advantages it provides, especially in advanced packaging applications like integrated fan-out.

更直接的是，我們目前正受益於 Foundry 和 Logic 中其他客戶的節點轉換，我們的第四季度展望得到了世界領先代工廠的初始 7 納米產量的支持。正如我們過去所討論的那樣，這種不斷擴大的關係的基石是 FormFactor 專有的基於 MEMS 的探針技術及其提供的差異化優勢，尤其是在集成扇出等高級封裝應用中。

We will continue our R&D investments in MEMS probe leadership to further differentiate and increase our share as more silicon is integrated using advanced packaging.

我們將繼續在 MEMS 探針領先地位方面進行研發投資，以進一步區分和增加我們的份額，因為更多的矽是使用先進封裝集成的。

Turning to memory. Amidst the high degree of noise around customer investment plans, the third quarter saw sustained volumes of probe cards for both DRAM and Flash applications. The 3 major DRAM manufacturers continued to exhibit slightly different node transition and design release cadences, helping to stabilize and smooth overall probe card demand from quarter-to-quarter. In addition, our opportunistic Flash strategy continued to pay dividends as we've won several high-end designs where FormFactor's MEMS technology has a substantial performance in quality advantage over our competitors.

轉向記憶。在圍繞客戶投資計劃的高度喧囂中，第三季度 DRAM 和閃存應用的探針卡數量持續增長。3 大 DRAM 製造商繼續展示略有不同的節點過渡和設計發布節奏，有助於穩定和平滑每個季度的整體探針卡需求。此外，我們的機會主義閃存策略繼續帶來回報，因為我們贏得了多項高端設計，在這些設計中，FormFactor 的 MEMS 技術在質量方面比我們的競爭對手具有顯著的性能優勢。

Another exciting component of FormFactor's opportunity set is the broadening of our served applications space through our engineering systems products. As we've described previously, this business allows us to engage with customers in early development of the devices and technologies that will power tomorrow's electronics industry.

FormFactor 機會集的另一個令人興奮的組成部分是通過我們的工程系統產品擴大我們服務的應用程序空間。正如我們之前所描述的，這項業務使我們能夠與客戶一起參與為明天的電子行業提供動力的設備和技術的早期開發。

Increasingly, these products are in the form of optoelectronic as the industry innovates in sensors, displays and other devices that rely on a combination of electrons and photons. Our team and products have been supporting development and initial production of such innovative devices as VCSELs, MicroLED displays and silicon photonics.

隨著行業在傳感器、顯示器和其他依賴電子和光子組合的設備方面進行創新，這些產品越來越多地採用光電形式。我們的團隊和產品一直在支持 VCSEL、MicroLED 顯示器和矽光子等創新設備的開發和初始生產。

In the silicon photonics application, we have partnered with the instrumentation leader, Keysight, to produce a turnkey integrated system that dramatically reduces the time to data for our customers, accelerating their time to market and increasing their profitability.

在矽光子學應用中，我們與儀器領導者 Keysight 合作生產交鑰匙集成系統，可顯著縮短客戶的數據獲取時間，加快他們的上市時間並提高他們的盈利能力。

Although, still an emerging application, we're excited by the recent momentum in silicon photonics as evidenced by the expansion of our installed base in the quarter to more than 10 systems.

儘管這仍然是一個新興應用，但我們對矽光子學最近的發展勢頭感到興奮，本季度我們的安裝基礎擴展到 10 多個系統就證明了這一點。

Consistent with the well-recognized weakening of customer investments in both DRAM and NAND Flash, we expect memory probe card demand to reduce in the fourth quarter. As a reminder, our lead times are approximately half a quarter. So our visibility beyond that is limited, especially in the current environment. Accordingly, we continue to manage our business with the knowledge that we operate in a cyclical industry, relying on our broad and diversified opportunity sets to generate demand, while maintaining a disciplined and flexible approach to our cost structure.

與公認的客戶對 DRAM 和 NAND 閃存的投資減弱一致，我們預計第四季度內存探針卡需求將減少。提醒一下，我們的交貨時間大約是半個季度。因此，除此之外我們的能見度是有限的，尤其是在當前環境下。因此，我們繼續以我們在周期性行業中運營的知識來管理我們的業務，依靠我們廣泛和多樣化的機會集來產生需求，同時對我們的成本結構保持嚴格和靈活的方法。

The second half of 2018 offered some nice proof points of these. In particular, the fourth quarter strength in Foundry and Logic is expected to offset weaker memory demand and paired with the operating expense control demonstrated in the third quarter is combining to deliver solid profitability and cash flow.

2018 年下半年提供了一些很好的證據。特別是，Foundry 和 Logic 第四季度的強勢預計將抵消內存需求疲軟的影響，再加上第三季度展示的運營費用控制，將帶來穩健的盈利能力和現金流。

In summary, we remain excited about our markets and our position in the industry and are committed to achieving our target financial model. As the share leader in our served markets, we are not immune to short-term industry demand volatility, but we are demonstrating an ability to weather this volatility.

總之，我們對我們的市場和我們在行業中的地位仍然感到興奮，並致力於實現我們的目標財務模式。作為我們所服務市場的領先者，我們無法免受短期行業需求波動的影響，但我們正在展示應對這種波動的能力。

Our engagements in early customer innovation in R&D through our engineering systems business, transitioning into production volumes with our consumables probe card business, is a powerful model that sets the stage for continued leadership, driven by growth in advanced packaging, mobile data and automotive applications.

我們通過我們的工程系統業務參與早期客戶研發創新，通過我們的耗材探針卡業務過渡到量產，這是一個強大的模式，為在先進封裝、移動數據和汽車應用的增長推動下繼續保持領先地位奠定了基礎。

With that, I'll hand the call over to Shai for further details on our third quarter and to provide insights into FormFactor's fourth quarter financial outlook.

有了這個，我將把電話轉給 Shai，了解我們第三季度的更多細節，並提供對 FormFactor 第四季度財務前景的見解。

Thank you, Mike, and good afternoon. As you saw from our press release and heard from Mike's comments, our third quarter results were comparable to our second quarter. FormFactor's revenue for the third quarter of 2018 were $135 million, basically flat with the second quarter.

謝謝你，邁克，下午好。正如您從我們的新聞稿中看到的以及從 Mike 的評論中聽到的那樣，我們第三季度的業績與第二季度相當。FormFactor 2018年第三季度營收為1.35億美元，與第二季度基本持平。

Probe card segment revenues of $111.6 million, and systems segment revenues of $23.4 million were both comparable to the Q2 level. Within the probe card segment, we also saw very similar revenues -- revenue levels in each of the markets we serve.

探針卡部門的收入為 1.116 億美元，系統部門的收入為 2340 萬美元，均與第二季度水平相當。在探針卡領域，我們也看到了非常相似的收入——我們服務的每個市場的收入水平。

Foundry and Logic revenues of $61.2 million decreased less than 2% compared to our second quarter and were 45% of total company revenues in the third quarter, slightly down from 46% in Q2.

Foundry and Logic 收入為 6120 萬美元，與第二季度相比下降不到 2%，佔第三季度公司總收入的 45%，略低於第二季度的 46%。

DRAM revenues were $37.4 million in Q3, down $0.7 million or 1.8% sequentially.

第三季度 DRAM 收入為 3740 萬美元，環比下降 70 萬美元或 1.8%。

In both Q2 and Q3, we experienced sustained DRAM demand as our customers released new design for data center and mobile application. DRAM revenues were 28% of total company revenues in the third quarter, consistent with the second quarter.

在第二季度和第三季度，隨著我們的客戶為數據中心和移動應用程序發布新設計，我們經歷了持續的 DRAM 需求。第三季度 DRAM 收入占公司總收入的 28%，與第二季度一致。

Flash revenues of $13 million were $1.6 million higher than in the second quarter, a 14% increase. We continue to see stronger demand for our technology due to stringent test requirements for high layer count 3D NAND. We are being opportunistic in capitalizing on winning additional Flash designs where we have a technology advantage. Approximately $8 million of the Flash revenues in Q3 were from NAND Flash applications. Looking ahead, we believe Flash will be a single-digit percentage of our revenue in the mid and long-term.

閃存收入為 1300 萬美元，比第二季度高出 160 萬美元，增幅為 14%。由於對高層數 3D NAND 的嚴格測試要求，我們繼續看到對我們技術的更強勁需求。我們正在投機取巧，在我們擁有技術優勢的地方贏得更多的 Flash 設計。第三季度大約 800 萬美元的閃存收入來自 NAND 閃存應用。展望未來，我們相信 Flash 在中長期內將占我們收入的個位數百分比。

GAAP gross margin for the third quarter of 2018 was $53 million or 39.2% of revenues, down 2.3% compared to 41.5% in the second quarter.

2018 年第三季度 GAAP 毛利率為 5300 萬美元，佔收入的 39.2%，較第二季度的 41.5% 下降 2.3%。

Similar to Q2, Q3 cost of revenues included $6 million of GAAP to non-GAAP reconciling items, which we outlined in the reconciliation table available on the Investor Relations section of our website and in our press release issued today.

與第二季度類似，第三季度的收入成本包括 600 萬美元的 GAAP 與非 GAAP 對賬項目，我們在我們網站投資者關係部分和今天發布的新聞稿中提供的對賬表中概述了這些項目。

On a non-GAAP basis, gross margin for the third quarter was $58.9 million or 43.7% of revenues, down 2.2% from the 45.9% in the second quarter and slightly above the midpoint of our outlook range.

按非美國通用會計準則計算，第三季度毛利率為 5890 萬美元，佔收入的 43.7%，比第二季度的 45.9% 下降 2.2%，略高於我們預期範圍的中點。

As a reminder, product and customer mix, including mix within the different markets we serve, have the biggest impact on our gross margin, and the decrease in Q3 was primarily due to a less favorable product mix in the third quarter as compared to the second quarter.

提醒一下，產品和客戶組合，包括我們服務的不同市場內的組合，對我們的毛利率影響最大，第三季度的下降主要是由於第三季度的產品組合不如第二季度四分之一。

Our probe card segment gross margin was 42.7% in the third quarter, a decrease of 2.6% compared to Q2 due to the product mix factor I mentioned before. Our Q3 systems segment gross margin was very similar to Q2 at 48.1%, 0.5% lower than Q2 on slightly lower revenues.

由於我之前提到的產品組合因素，第三季度我們的探針卡部門毛利率為 42.7%，比第二季度下降 2.6%。我們第三季度系統部門的毛利率與第二季度非常相似，為 48.1%，比第二季度低 0.5%，收入略有下降。

Our GAAP operating expenses were $43.6 million for the third quarter, $1.3 million lower than the second quarter. The third quarter operating expenses included $6.1 million of GAAP to non-GAAP reconciling items.

我們第三季度的 GAAP 運營費用為 4360 萬美元，比第二季度低 130 萬美元。第三季度運營費用包括 610 萬美元的 GAAP 與非 GAAP 調節項目。

Non-GAAP operating expenses for the third quarter were $37.5 million or 28% of revenue, down $2.1 million compared to Q2.

第三季度非美國通用會計準則運營費用為 3750 萬美元，佔收入的 28%，比第二季度減少 210 萬美元。

The decrease is mainly due to employee-related costs, including lower performance-based compensation and benefits and disciplined spending.

減少的主要原因是與員工相關的成本，包括較低的基於績效的薪酬和福利以及紀律支出。

Company noncash expenses for the third quarter included $7.5 million for the amortization of intangible assets, $4.5 million for stock-based compensation and depreciation of $3.6 million.

公司第三季度的非現金支出包括 750 萬美元的無形資產攤銷、450 萬美元的股票薪酬和 360 萬美元的折舊。

Amortization of intangibles and stock-based compensation were both slightly higher than in the second quarter due to timing of annual stock grants and updates to the amortization schedule.

由於年度股票授予的時間安排和攤銷時間表的更新，無形資產攤銷和股票薪酬均略高於第二季度。

The non-GAAP effective tax rate for the third quarter was 7.1%, similar to the 7.5% for the second quarter. We entered 2018 with over $240 million of remaining U.S.-based NOLs. As such, we continue to expect to have a non-GAAP effective tax rate of 5% to 8% while we utilize our U.S. NOLs.

第三季度的非美國通用會計準則有效稅率為 7.1%，與第二季度的 7.5% 相似。進入 2018 年，我們在美國剩餘的 NOL 超過 2.4 億美元。因此，我們繼續期望在使用我們的美國 NOL 時，非 GAAP 有效稅率為 5% 至 8%。

GAAP net income was $7.7 million or $0.10 per fully diluted share for the third quarter compared to net income of $9.1 million or $0.12 per fully diluted share in Q2.

第三季度 GAAP 淨收入為 770 萬美元，即每股完全攤薄收益 0.10 美元，而第二季度的淨收入為 910 萬美元，即每股完全攤薄收益 0.12 美元。

Third quarter non-GAAP net income was $19.6 million or $0.26 per fully diluted share compared to $20.4 million or $0.27 per fully diluted share in Q2.

第三季度非 GAAP 淨收入為 1960 萬美元或每股完全攤薄收益 0.26 美元，而第二季度為 2040 萬美元或每股完全攤薄收益 0.27 美元。

Moving on to the balance sheet and cash flow. We generated $13 million of free cash flow in the third quarter compared to $16.8 million in Q2, taking our total cash to $143 million at the end of the quarter. The $3.8 million decrease in free cash flow in Q3 as compared to Q2 is primarily due to an increase in inventory to meet Q4 customer demand.

轉到資產負債表和現金流量。我們在第三季度產生了 1300 萬美元的自由現金流，而第二季度為 1680 萬美元，使我們的現金總額在本季度末達到 1.43 億美元。與第二季度相比，第三季度自由現金流減少 380 萬美元，這主要是由於為滿足第四季度客戶需求而增加庫存。

We spent $13.2 million on principal and interest payments on our term loan during the quarter, including $5 million of prepayments. Going forward, we expect to repay the term loan principal based on the original amortization schedule. Our total cash balance exceeded the balance of our debt by $71 million at quarter end, an increase of $12 million.

我們在本季度支付了 1320 萬美元的定期貸款本金和利息，其中包括 500 萬美元的預付款。展望未來，我們預計將根據原來的攤銷時間表償還定期貸款本金。截至季度末，我們的總現金餘額超過債務餘額 7,100 萬美元，增加了 1,200 萬美元。

In line with our annual capital spending plan of $16 million to $20 million, we invested $3.8 million in capital expenditures during Q3.

根據我們 1600 萬至 2000 萬美元的年度資本支出計劃，我們在第三季度投入了 380 萬美元的資本支出。

Turning to the fourth quarter non-GAAP outlook. We expect Q4 revenue to be in the range of $132 million to $140 million, and non-GAAP gross margins to be in the range of 42% to 45%. Non-GAAP earnings per fully diluted share is expected to be in the range of $0.23 to $0.29. A reconciliation of our GAAP to non-GAAP Q4 outlook is available on the Investor Relations section of our website and in our press release issued today.

轉向第四季度非 GAAP 展望。我們預計第四季度收入將在 1.32 億美元至 1.4 億美元之間，非 GAAP 毛利率將在 42% 至 45% 之間。非 GAAP 每股完全攤薄收益預計在 0.23 美元至 0.29 美元之間。我們網站的投資者關係部分和今天發布的新聞稿中提供了我們的 GAAP 與非 GAAP 第四季度展望的對賬。

With that, let's open the call to questions. Operator?

有了這個，讓我們打開問題的電話。操作員？

(Operator Instructions) Our first question comes from the line of Craig Ellis from B.Riley FBR.

（操作員說明）我們的第一個問題來自 B.Riley FBR 的 Craig Ellis。

Mike, I wanted to go back to your points on the Foundry and Logic business and just see if I could dig into some of the details that we have coming up. So nice to see a strong performance from your U.S. customer. The question is, since they've been public in August with their 3-year road map with a late 2018 -- late 2019 and 2020, 14, 14 and 10 transition. What does that mean for that part of Foundry and Logic? Does it mean it should be steady from levels we're seeing in the back half of the year? Or is there an opportunity to grow that part of that business?

邁克，我想回到你關於 Foundry 和 Logic 業務的觀點，看看我是否可以深入了解我們即將提出的一些細節。很高興看到您的美國客戶表現出色。問題是，自從他們在 8 月公開了他們的 3 年路線圖以及 2018 年末 - 2019 年末和 2020 年、14、14 和 10 過渡期。這對 Foundry 和 Logic 的那部分意味著什麼？這是否意味著它應該與我們在今年下半年看到的水平保持穩定？或者是否有機會發展該業務的這一部分？

Thanks for the question, Craig. Obviously, with that customer, it's been a very volatile year, starting with the 10-nanometer delay at the beginning of the year. As you've seen, we're pretty pleased with the growth of that business as they've transitioned some products onto 14-nanometer and generated probe card demand on these new designs.

謝謝你的問題，克雷格。顯然，對於那個客戶來說，這是非常不穩定的一年，從年初的 10 納米延遲開始。如您所見，我們對該業務的增長感到非常滿意，因為他們已將一些產品過渡到 14 納米，並產生了對這些新設計的探針卡需求。

I think, as you say, the cadence is going forward of continued 14-nanometer designs and then transitioning much of the wafer start volume to 10-nanometer is something that the customer has been fairly transparent publicly about their plans in 2019. And we continue to stay very, very close in from a planning perspective with them to make sure we're prepared to make that transition in lockstep with them. There may be some upside associated with a 10-nanometer transition. As we discussed in the past, typically, node transitions have higher test intensities. Given that the bulk of our volume right now is on 14-nanometer, there is some potential upside to 10-nanometer. But I want to caution people that it's also not purely additive. It's not going to be 10-nanometer on top of 14-nanometer, there will largely be a substitution factor there with maybe a little more test intensity.

我認為，正如您所說，持續 14 納米設計的節奏正在向前推進，然後將大部分晶圓起始體積過渡到 10 納米，這是客戶在 2019 年公開其計劃的相當透明的事情。我們繼續從規劃的角度與他們保持非常、非常密切的聯繫，以確保我們準備好與他們同步進行過渡。10 納米過渡可能有一些好處。正如我們過去討論的那樣，通常，節點轉換具有更高的測試強度。鑑於我們目前的大部分體積是在 14 納米上，因此 10 納米有一些潛在的上升空間。但我想提醒人們，它也不是純粹的加法。它不會是 14 納米之上的 10 納米，那裡將主要有一個替代因素，測試強度可能會更高一些。

Got it. That's helpful. And then switching gears to Taiwan foundry. That's been a nice growth story for you. And it sounds like there's good 7-nanometer traction. That customer seems to have a growing customer base itself. So can you talk about the potential for that business as you look out over the next 3 to 4 quarters to provide growth? And what are the prospects that business can provide solid year-on-year growth in 2019 versus 2018?

知道了。這很有幫助。然後切換到台灣代工。這對你來說是一個很好的成長故事。聽起來好像有很好的 7 納米牽引力。該客戶本身似乎擁有不斷增長的客戶群。那麼，在您展望未來 3 到 4 個季度提供增長時，您能否談談該業務的潛力？與 2018 年相比，企業在 2019 年實現穩健的同比增長的前景如何？

Yes. So you're absolutely right. That is one of the nice growth stories in our business in 2018. I think there's 2 components to it. First of all, our opportunity in serving this foundry is really associated with 10-nanometer, 7-nanometer and below, with a very strong growth vector around advanced packaging, in particular, integrated fan-out. So as we see more of that foundry's wafer starts and more fabless customer designs moving to those nodes and the advanced packaging technologies, that grows the opportunity for us. We said in the past, we expect long-term this opportunity to be comparable to the business we have with our largest customer. And nothing we've seen so far has changed us -- has changed our view on that. We continue to make good progress towards it. And I think you'll see us having gained share in 2018 over 2017 of that customer growing the business, and we expect in our planning to do the same thing in 2019 as we grow towards, again, the magnitude of business we have with our largest customer.

是的。所以你是絕對正確的。這是我們 2018 年業務中的一個不錯的增長故事。我認為它有兩個組成部分。首先，我們為這家代工廠服務的機會確實與 10 納米、7 納米及以下工藝相關，在先進封裝方面具有非常強勁的增長向量，特別是集成扇出。因此，隨著我們看到更多代工廠的晶圓開始，更多無晶圓廠客戶設計轉移到這些節點和先進的封裝技術，這為我們增加了機會。我們過去說過，從長遠來看，我們希望這個機會能夠與我們與最大客戶的業務相媲美。到目前為止，我們所看到的一切都沒有改變我們——改變了我們對此的看法。我們繼續朝著它取得良好進展。而且我認為你會看到我們在 2018 年比 2017 年獲得了該客戶增長業務的份額，並且我們希望在我們的計劃中在 2019 年做同樣的事情，因為我們再次朝著我們擁有的業務規模發展最大的客戶。

That's helpful. And then Shai, I'll flip it over to you with 2 clarifications. One, with respect to gross margin. It seems like gross margin is performing well. You've got certainly volume working more to your favor. Can you give us a sense for just the growth -- gross margin gives and takes in the fourth quarter? And sticking with the middle of the income statement, were there any onetime or special items in the meaningful decrease in the third quarter's operating expense? And is that an operating expense level that it is sustainable going forward?

這很有幫助。然後是 Shai，我將通過 2 個說明將其轉交給您。第一，關於毛利率。毛利率似乎表現良好。你肯定有更多的音量對你有利。您能否讓我們了解第四季度的增長——毛利率的變化？並堅持損益表的中間部分，第三季度營業費用的顯著減少是否有任何一次性或特殊項目？這是一個可持續發展的運營費用水平嗎？

Thanks for the 2 questions, I think, Craig. I'll start with gross margin. So as I said in my remarks and we said before, mix is the biggest impact on our gross margin. And we saw that evident in the difference between Q2 and Q3. And gross margins -- and Q4 gross margin is expected to stay in the same level because of these changes of the mix. And that's -- this has been consistent. No surprises there. When it comes to OpEx, we have communicated before range of $36 million to $39 million of quarterly OpEx. We are within that range in Q3 and Q4. No special onetime items that we saw. We continue to monitor our OpEx. We remain disciplined. And we are keeping our expenses -- and that's our plan, to keep our expenses in line with our revenue going forward.

謝謝你提出的兩個問題，我想，克雷格。我將從毛利率開始。因此，正如我在發言中和我們之前所說的那樣，混合對我們的毛利率影響最大。我們在 Q2 和 Q3 之間的差異中看到了這一點。由於這些組合的變化，毛利率和第四季度毛利率預計將保持在同一水平。那就是 - 這一直是一致的。那裡沒有驚喜。談到 OpEx，我們已經溝通了 3600 萬至 3900 萬美元的季度 OpEx 範圍。我們在第三季度和第四季度處於該範圍內。我們沒有看到任何特殊的一次性物品。我們繼續監控我們的運營支出。我們保持紀律。我們正在保持開支——這就是我們的計劃，讓我們的開支與未來的收入保持一致。

Your next question comes from the line of Edgar Roesch from Sidoti & Company.

您的下一個問題來自 Sidoti & Company 的 Edgar Roesch。

On that theme, I wanted to ask because your guidance implies you'd have kind of 3 quarters in a row right around the $135 million, $136 million, if you use the midpoint for Q4. So I wanted to ask if the pacing of revenues within the quarter also was pretty evenly distributed? Or if you saw any kind of fall off and then acceleration towards the end of the quarter or vice versa? Any color would be appreciated.

關於這個主題，我想問一下，因為你的指導暗示如果你使用第四季度的中點，你將連續 3 個季度在 1.35 億美元、1.36 億美元左右。所以我想問一下，本季度的收入節奏是否也分佈得相當均勻？或者，如果您看到任何類型的下降然後在本季度末加速，反之亦然？任何顏色將不勝感激。

Sure, and thanks, Ed. I think I'll start by summarizing that, although, the top line results, Q2 to Q3 to our midpoint view of Q4 are very similar at sort of this mid-130s stretching to $136 million in Q4 are very similar to each other, there are an awful lot of moving parts underneath there. In the fourth quarter, in particular, we're expecting to see a substantial shift from memory to Foundry and Logic. And inside each of the markets we serve, there's quite a bit of variability in between each customer and individual designs and some of the cadences they go through on even a week-to-week basis. So the ebbs and flows both from a mix perspective and from a timing perspective within the quarter are much more dynamic than the top line results would lead you to believe.

當然，謝謝，埃德。我想我首先要總結一下，雖然頂線結果，第二季度到第三季度與我們對第四季度的中點觀點非常相似，在這個 130 年代中期延伸到第四季度的 1.36 億美元彼此非常相似，有下面有很多活動部件。特別是在第四季度，我們預計會看到從內存到 Foundry 和 Logic 的重大轉變。在我們服務的每個市場中，每個客戶和個人設計之間存在相當大的差異，甚至每週都會經歷一些節奏。因此，從混合角度和時間角度來看，本季度的潮起潮落比頂線結果讓您相信的更具活力。

Okay. I appreciate that. And then your business touches a lot of different aspects of the industry here. And I was just wondering if you could provide any kind of color on the issue of tariffs? And whether -- if you can even offer some general comments on any kind of change in behavior or demand modification that you're -- that you've borne witness to, maybe not in your own business, but that you're -- you would say, you've seen as a result of some uncertainty around the tariff issue?

好的。我很感激。然後您的業務涉及這裡行業的許多不同方面。我只是想知道你是否可以就關稅問題提供任何顏色？以及是否——如果你甚至可以就任何類型的行為改變或需求修改提供一些一般性評論——你已經見證了，也許不是在你自己的業務中，但你是——你會說，你是否看到過關稅問題帶來的一些不確定性？

Your next question comes from the line of...

你的下一個問題來自......

In particular the tariff issue for us is pretty squarely focused, as I think it is for most people on China. We've had a significant footprint in the region for more than a decade and has been investing fairly heavily in that business as the indigenous Chinese semiconductor industry sort of bootstraps itself up, especially in memory to full production. Just to benchmark people, it still typically represents less than 10% of our revenue in any given time period. But we do view it as most other suppliers in this space do, as interesting growth.

特別是對我們來說，關稅問題是非常明確的重點，因為我認為對中國的大多數人來說都是如此。十多年來，我們在該地區擁有重要的足跡，並且隨著中國本土半導體行業的自我提升，特別是在內存全面生產方面，我們一直在該業務上投入相當大的資金。僅作為基準，它在任何給定時間段內通常仍占我們收入的不到 10%。但我們確實像該領域的大多數其他供應商一樣將其視為有趣的增長。

Okay. And then one final question. Engineering systems, revenues year-to-date are pretty flat year-over-year. The original intent seemed like that might be an interesting area to consolidate. Just wondering if the viewpoint on that industry is still pretty consistent. And once you get your balance sheet where you want it, maybe could get a little more active on that front.

好的。然後是最後一個問題。工程系統，年初至今的收入同比持平。最初的意圖似乎是整合一個有趣的領域。只是想知道對該行業的觀點是否仍然非常一致。一旦你把資產負債表放在你想要的地方，也許可以在這方面變得更加活躍。

Yes. And maybe, Ed, I don't know whether we had some technical difficulties there, but I wouldn't mind finishing my thought on the tariffs issue. We have seen...

是的。也許，埃德，我不知道我們在那裡是否遇到了一些技術困難，但我不介意結束我對關稅問題的思考。我們已經看到...

I apologize.

我道歉。

No problem. We have seen a few discussions with -- mostly with suppliers, where we're importing from the region. I would say limited impact to our customer engagements at this point, but it's something we're monitoring and evaluating pretty closely. Because I think we, along with most suppliers operating in a global industry, have a hard time viewing this as being positive. So moving then, I'll...

沒問題。我們已經看到了一些討論——主要是與我們從該地區進口的供應商進行的討論。我會說目前對我們的客戶參與度的影響有限，但這是我們正在密切監控和評估的事情。因為我認為我們以及全球行業中的大多數供應商都很難將此視為積極的。那麼動起來，我會...

(technical difficulty)

（技術難度）

The priority we've talked about continuing to delever being a useful use of -- being a use of our capital. We applied essentially all of our free cash flow to delevering in the third quarter. But we continue to be pretty active in prospecting and building an M&A funnel around the themes of electrical test and measurement in some of these emerging growth year markets. So I'd agree with you. I think there are some opportunities there. We're still in the prospecting phase and debt reduction, delevering still remains our top priority.

我們談到的優先事項是繼續去槓桿化是一種有用的使用——是一種使用我們的資本。我們在第三季度將基本上所有的自由現金流都用於去槓桿化。但我們繼續非常積極地圍繞這些新興增長年市場中的一些電氣測試和測量主題進行勘探和建立併購漏斗。所以我同意你的看法。我認為那裡有一些機會。我們仍處於探索階段，減少債務、去槓桿化仍然是我們的首要任務。

Our next question comes from the line of David Duley from Steelhead.

我們的下一個問題來自 Steelhead 的 David Duley。

You mentioned that you've done well with a Taiwan foundry. But when we look at your breakout of results in the quarter, geographically, Taiwan is down pretty strong. Could you just elaborate a little bit more on the timing of your business there? And as a follow-on, with a lot more people adopting 7 nanometers with that foundry than at 10 nanometers, would you expect that business to smooth out or be left first half loaded?

你提到你與一家台灣代工廠合作得很好。但是，當我們看一下您在本季度的業績突破時，從地域上看，台灣的表現非常強勁。您能詳細說明一下您在那裡開展業務的時間嗎？作為後續行動，與 10 納米相比，該代工廠採用 7 納米的人數要多得多，您是否預計該業務會順利進行或上半年負荷？

Yes. And I think the second part of your question hits on the core issue. Our historical, even through the middle part of 2018 engagement with this customer, has been pretty focused and concentrated in essentially a handful of application process or projects. And part of what we're trying to convey about the fourth quarter is we see for the first time us having a significant fourth quarter contribution from that customer as we broaden the relationship, as we generally gain market share there. But also as the relationship expands and we serve more customers and more designs, we do expect it to start to smooth out as we move through the fourth quarter and into 2019.

是的。我認為你問題的第二部分觸及了核心問題。我們的歷史，甚至在 2018 年中期與該客戶的接觸中，一直非常專注並集中在少數幾個申請流程或項目上。關於第四季度，我們試圖傳達的部分內容是，隨著我們擴大關係，我們第一次看到該客戶在第四季度做出了重大貢獻，因為我們通常在那裡獲得了市場份額。但隨著關係的擴大以及我們為更多客戶和更多設計提供服務，我們確實希望隨著第四季度進入 2019 年，它會開始變得平穩。

Excellent. And then did you have 10% customers during the quarter? And what percentages were they?

出色的。然後你在本季度有 10% 的客戶嗎？他們的百分比是多少？

Yes, this is Shai. We had our largest customer, Intel, at -- let me give you the percentage, just a second, at 24% in the quarter, and Micron was #2 this quarter at 12%.

是的，這是沙伊。我們最大的客戶英特爾——讓我給你一個百分比，只是一秒鐘，本季度為 24%，而美光本季度排名第二，為 12%。

Excellent. And then the Flash revenue that you're capturing now and that you've seen growth in versus last year. I think you mentioned it had to do with higher layer counts. Would you expect your Flash revenue to perhaps ramp up with 96-layer Flash parts? Or is that -- is there some correlation between this? Or what is the driver to this business to grow further?

出色的。然後是您現在獲得的 Flash 收入，並且與去年相比有所增長。我想你提到它與更高的層數有關。您是否預計您的閃存收入可能會隨著 96 層閃存部件的增加而增加？或者是——這之間有某種相關性嗎？或者是什麼推動了這項業務進一步發展？

Yes. It's a very good question, David, and one that we debate a lot internally. Certainly, our Flash business today as we've opportunistically go -- gone after designs and parts of the market where we really have a differentiated advantage have been pretty strongly correlated to higher layer counts. They've also been correlated pretty strongly to higher densities and higher test speeds associated with certain customers and their test strategies. So I'm not sure I'd draw one-to-one correlation between 96-layer Flash and FormFactor Flash growth. I think it's one of the components that certainly helps us as it drives up complexity in the required performance at the wafer test step where we participate.

是的。這是一個很好的問題，大衛，我們在內部爭論了很多。當然，我們今天的閃存業務就像我們機會主義的那樣 - 追求我們真正具有差異化優勢的設計和部分市場與更高層數密切相關。它們還與某些客戶及其測試策略相關的更高密度和更高測試速度密切相關。所以我不確定我會得出 96 層閃存和 FormFactor 閃存增長之間的一對一關係。我認為它是肯定能幫助我們的組件之一，因為它在我們參與的晶圓測試步驟中提高了所需性能的複雜性。

And I guess one final question for me is along those same lines. It sounds like, not only the higher layer counts help, but that these Flash parts have higher speeds, so longer test times. And so my question is, do you see an increase in test time intensity with these Flash parts? And maybe you could just share with us what that increase in intensity is. And then just to double-check. In the past, I think you've mentioned that advanced packaging, such as InFO, are roughly 20% or 25% more test intensive and probe card intensive. I was wondering if that is still the view or if that's the accurate view?

我想我的最後一個問題是沿著同樣的路線。聽起來，不僅更高的層數有幫助，而且這些閃存部件具有更高的速度，因此測試時間更長。所以我的問題是，您是否看到這些 Flash 部件的測試時間強度有所增加？也許您可以與我們分享強度的增加是什麼。然後只是仔細檢查。過去，我想您已經提到，先進封裝（例如 InFO）的測試強度和探針卡強度大約高出 20% 或 25%。我想知道這是否仍然是視圖，或者那是否是準確的視圖？

Sure. So generally, on test intensity and test time increase is associated with different things. It's a pretty complicated function of a whole bunch of variables. Not the least of which is what the yield of the native die are. I think the ballpark estimate associated with advanced packaging being 20%, 25% more test insensitive -- more test intensive than, if you like, a plain silicon die, I think it's a reasonable estimate and that's been triangulated by, I think, a couple of other test suppliers as well. 3D NAND is a little bit more complicated because it goes to the yield ramps, the layer counts and then, of course, the individual architectural decisions that each of the customers are making and their test strategies, where they choose to spend their test dollars, whether it be a wafer test or final test. So that one is a little more variable. It does seem to be more test intensive as you go up in layers. And certainly, as we see your die stacking and advanced packaging moving into some of the regions of nonvolatile memory, that offers the opportunity associated with advanced packaging as well.

當然。所以一般來說，測試強度和測試時間的增加與不同的事情有關。這是一大堆變量的相當複雜的函數。其中最重要的是原生芯片的產量。我認為與先進封裝相關的粗略估計是 20%，測試不敏感程度高 25%——測試強度比普通矽芯片更高，我認為這是一個合理的估計，而且我認為，這是一個三角測量還有幾個其他測試供應商。3D NAND 稍微複雜一點，因為它涉及良率提升、層數，當然還有每個客戶正在做出的個人架構決策和他們的測試策略，他們選擇在哪里花費測試資金，無論是晶圓測試還是最終測試。所以那個有點多變。當您逐層上升時，它似乎確實需要更多的測試。當然，當我們看到您的芯片堆疊和先進封裝進入非易失性存儲器的某些區域時，這也提供了與先進封裝相關的機會。

(Operator Instructions) Your next question comes from the line of Patrick Ho from Stifel.

（操作員說明）您的下一個問題來自 Stifel 的 Patrick Ho。

Mike, maybe as a follow-up to Dave's comments about test intensity on the memory side. If we can look at DRAM for a second. Obviously, the industry is undergoing a lot of node transitions which helps you on the design phase. But talking to people in the industry, test intensity for DRAM is also becoming higher with -- the higher speeds and bandwidth and things of that nature. Can you comment on how that potentially can increase, I guess, the market opportunity, especially in the near-term as you're going through several node transitions in the industry?

邁克，也許作為戴夫關於內存方面測試強度的評論的後續行動。如果我們能看一下 DRAM。顯然，該行業正在經歷大量節點轉換，這有助於您進入設計階段。但與業內人士交談時，DRAM 的測試強度也越來越高——更高的速度和帶寬以及類似的東西。我想，您能否評論一下這可能如何增加市場機會，尤其是在您正在經歷行業中的幾個節點轉換的短期內？

Yes. So similar things in the last question as you noted, Patrick. I think DRAM, because of the node transitions that all the major customers are going through, we do see generally the test intensity going up there. Any time there's a move to a new node, higher densities and higher speeds, this does demand the increased test intensity to make sure customers are resolving their yield challenges and ramping effectively. That's part of FormFactor's value proposition for them.

是的。帕特里克，上一個問題中的內容與你提到的非常相似。我認為 DRAM，由於所有主要客戶都在經歷節點轉換，我們確實看到測試強度普遍上升。任何時候轉移到新節點、更高的密度和更高的速度，這都需要增加測試強度，以確保客戶解決他們的良率挑戰並有效地提升。這是 FormFactor 對他們的價值主張的一部分。

I think the other thing I'd like to highlight though in DRAM is a theme that you've seen in our DRAM business in 2018 and that's high bandwidth memory, which is one of these advanced packaging applications. Each of those die, as we've discussed in the past, that goes into the stack die HBM, or high bandwidth memory package, requires significantly higher test intensity essentially to make sure that it doesn't kill its neighbors in this stack. And so that's one of the other big drivers associated with test intensity in DRAM is the innovation associated with advanced packaging like HBM, driving the need to ensure maybe not quite known good die, but pretty good -- pretty close to known good die.

我想在 DRAM 中我想強調的另一件事是你在 2018 年的 DRAM 業務中看到的一個主題，那就是高帶寬內存，這是這些高級封裝應用程序之一。正如我們過去討論過的那樣，進入堆疊芯片 HBM 或高帶寬內存封裝的每個芯片都需要顯著更高的測試強度，本質上是為了確保它不會殺死堆棧中的鄰居。因此，與 DRAM 中的測試強度相關的其他重要驅動因素之一是與 HBM 等先進封裝相關的創新，推動了確保可能不太為人所知的好芯片的需求，但非常好——非常接近已知的好芯片。

Great. That's helpful. And maybe going to the engineering systems business for a bit. There is, I guess, multiple applications and multiple products, which you have, whether it's on wafer or advanced packaging. Is anyone of those segments or any one of those segments, I guess, outperforming in the near term? Are you seeing more advanced packaging applications more so than the others? Or is it pretty balanced?

偉大的。這很有幫助。或許還可以從事工程系統業務。我想，無論是在晶圓上還是先進封裝上，你都有多種應用和多種產品。這些細分市場中的任何一個或其中任何一個細分市場，我猜，在短期內表現出色嗎？您是否比其他人更多地看到了更先進的封裝應用？或者它非常平衡？

I think overall what we're seeing is something I tried to convey in the prepared remarks. A lot of our engineering systems business, both the interaction with customers and the development in shipment of systems is really starting to shift towards photonics applications. Whether they be sensors like VCSEL or CMOS image sensors, some of the stuff we're doing with next-generation displays like MicroLED, we're seeing that be a fairly strong segment both from an activity perspective, but also from a business perspective. It's starting to impact our results in a pretty significant way, which is why we try to draw attention to it, in particular the silicon photonics example, driving an installed base now of more than 10 systems, which for an engineering business, is a significant footprint worldwide.

我認為總體而言，我們所看到的是我試圖在準備好的發言中傳達的內容。我們的許多工程系統業務，無論是與客戶的互動還是系統出貨的開發，都真正開始轉向光子學應用。無論是像 VCSEL 還是 CMOS 圖像傳感器這樣的傳感器，我們正在用 MicroLED 等下一代顯示器做的一些事情，我們認為無論是從活動的角度還是從業務的角度來看，這都是一個相當強大的細分市場。它開始以相當重要的方式影響我們的結果，這就是為什麼我們試圖引起人們的注意，特別是矽光子學的例子，推動了現在超過 10 個系統的安裝基礎，這對於工程業務來說是一個重要的足跡遍布全球。

Great. And final question maybe for Shai in terms of the free cash flow and CapEx needs. Given that, we're few -- it's a couple of years from the Cascade Microtech deal. As your free cash continues to grow, I guess, where are some of the priorities? Is there a need to increase CapEx as some of your product and markets grow? Where are we looking at putting that cash to use?

偉大的。最後一個問題可能是關於自由現金流和資本支出需求的 Shai。鑑於此，我們很少——距離 Cascade Microtech 交易還有幾年時間。隨著您的自由現金持續增長，我猜，一些優先事項在哪裡？隨著您的某些產品和市場的增長，是否需要增加資本支出？我們打算在哪裡使用這些現金？

So specifically about CapEx our plan in the last couple of years and going forward will be to invest between $16 million to $20 million a year on capital expenditures. I see that we -- I see ourselves staying in that range next year as well. And regarding capital how we deploy our cash, we said before, our first priority is to deleverage our balance sheet and repay the loan. We've been prepaying our loan in the last few quarters. Q3 of '18 will be the last quarter we're going to do advance prepayments on the loan. Going forward, we are going back to the original amortization schedule and moving into our second priority, which is to expand our SAM through an M&A as Mike discussed before. We believe it will -- can create more value to our shareholders.

因此，特別是關於資本支出，我們在過去幾年和未來的計劃將是每年投資 1600 萬至 2000 萬美元用於資本支出。我看到我們 - 我認為明年我們自己也會保持在這個範圍內。關於我們如何配置現金的資本，我們之前說過，我們的首要任務是去槓桿化我們的資產負債表並償還貸款。在過去的幾個季度裡，我們一直在提前償還貸款。18 年第三季度將是我們要提前償還貸款的最後一個季度。展望未來，我們將回到原來的攤銷時間表，並進入我們的第二個優先事項，即通過 Mike 之前討論的併購來擴大我們的 SAM。我們相信它會 - 可以為我們的股東創造更多價值。

Your next question comes from the line of Christian Schwab from Craig-Hallum.

你的下一個問題來自 Craig-Hallum 的 Christian Schwab。

This is Tyler on for Christian. So first, your largest customer moving to 10-nanometer as you spoke about, their time line has been pretty well transparent. But I was just wondering if you could remind us what's the time line for your business in relation to that customer's 10-nanometer products?

這是克里斯蒂安的泰勒。所以首先，正如你所說，你最大的客戶轉向 10 納米，他們的時間線非常透明。但我只是想知道您是否可以提醒我們您的業務與該客戶的 10 納米產品相關的時間線是什麼？

Sure. Thanks, Tyler. Well, I mean, As we said about this node transition and the transition to 10-nanometer, historical comparisons have led us astray a couple of times. But if I do rely on some of the historical node transitions we've been through as a 4-generation supplier with this customer, typically, I'd expect us to lead their broad market launch of products by a quarter or 2, maybe 3. So we see this, to put it different way, as long as they stay on track with the late 2019 production release they've talked about publicly. We see this probably being a mid-2019 event, where you'll start to see significant activity for us. Now that's true more generally throughout much of our customer base. There are some projects in RF that have shorter cycle times or lead times between probe card delivery and customer shipment. But by and large, you'll see us -- our business leading -- our customer -- our customer product releases by a quarter or 2, sometimes 3.

當然。謝謝，泰勒。好吧，我的意思是，正如我們所說的這個節點過渡和向 10 納米的過渡，歷史比較讓我們誤入歧途了幾次。但是，如果我確實依賴於我們作為該客戶的第 4 代供應商所經歷的一些歷史節點轉變，通常情況下，我希望我們能夠領先他們廣泛的產品市場推出四分之一或 2 個季度，也許是 3 個季度. 所以我們看到這一點，換句話說，只要他們在 2019 年底的生產版本上保持正軌，他們已經公開談論過。我們認為這可能是 2019 年年中的事件，屆時您將開始看到我們的重大活動。現在，在我們的大部分客戶群中，這種情況更普遍。RF 中的一些項目在探針卡交付和客戶裝運之間具有更短的周期時間或提前期。但總的來說，你會看到我們——我們的業務領導者——我們的客戶——我們的客戶產品每季度或 2 次發布，有時是 3 次。

Great. And then a second one on the memory side, DRAM side. This quarter your DRAM business is pretty stable. I believe you guys noted due largely to some new devices. So I was just wondering as we go into this next year and memory customers make the transition to this next node, how -- what's the magnitude of that or what's the expected magnitude out of the DRAM business versus normal new devices on the current node?

偉大的。然後是內存方面的第二個，DRAM 方面。本季度您的 DRAM 業務非常穩定。我相信你們之所以注意到，主要是因為一些新設備。所以我只是想知道，當我們進入明年，內存客戶將過渡到下一個節點時，DRAM 業務與當前節點上的正常新設備相比，其規模或預期規模是多少？

Well, that's also a situation that's been pretty dynamic over 2018 and even over the last couple of years. It used to be 4, 5 years ago that our business was purely driven by node transitions. But as nodes have -- as shrinks have gotten tougher, as node transitions have been drawn out, we've tried to draw people's attention to the fact that we also derive significant demand from new designs on existing nodes. And currently, there is an awful lot of our DRAM revenue that's supporting new designs on existing nodes. I think if we expect that some of the node transitions to things like 1Y in the first part of 2019, maybe the first half of 2019. I think those will be events that probably cause a little bit of growth in our DRAM business off the fourth quarter levels. Again, reminding you that we're seeing a little bit of weakness off the third quarter levels going to fourth quarter in our DRAM probe card demand. If we see those node transitions kick in, I think you could see it come back up to the Q2, Q3 levels.

好吧，這種情況在 2018 年甚至過去幾年都非常活躍。4、5 年前，我們的業務完全由節點轉換驅動。但是隨著節點的出現——隨著收縮變得越來越困難，隨著節點轉換的進行，我們試圖引起人們的注意，我們也從現有節點上的新設計中獲得了巨大的需求。目前，我們有大量的 DRAM 收入用於支持現有節點上的新設計。我想如果我們預計一些節點會在 2019 年上半年過渡到 1Y 之類的東西，也許是 2019 年上半年。我認為這些事件可能會導致我們的 DRAM 業務在第四季度水平上略有增長。再次提醒您，我們看到 DRAM 探針卡需求從第三季度到第四季度的水平略有疲軟。如果我們看到這些節點轉換開始，我想你會看到它回到第二季度、第三季度的水平。

Your next question comes from the line of Craig Ellis from B. Riley FBR.

您的下一個問題來自 B. Riley FBR 的 Craig Ellis。

Mike, I just wanted to cycle back. You've touched a number of times in different comments on the automotive opportunity and mobility, and advanced packaging. But I just wanted to go back to the $130 million opportunity that you see longer-term there. And can you can just catch us up on where you think the company is in terms of harvesting some of the growth that exists in those 3 areas?

邁克，我只是想騎車回去。你在不同的評論中多次談到了汽車機會和機動性，以及先進的封裝。但我只想回到你在那裡看到的長期 1.3 億美元的機會。您能否跟我們談談您認為公司在收穫這三個領域中存在的一些增長方面所處的位置？

Sure. So to get everybody on the same page, we've talked about these 3 components, advanced packaging, mobile data and automotive, as essentially being the constituent growth drivers that get us to our target model, which delivers $650 million on the top line and $1.50 of non-GAAP earnings per share. As I break down the 3 of those, I think far and away, the leader from our perspective in executing against those opportunities is advanced packaging. Whether it be HBM in memory, which we've talked about previously and a little bit on this call or integrated fan-out, which is one of the key drivers for our expanding foundry business at 10 and 7-nanometer. Advanced packaging, we're probably 2/3, 3/4 of the way there to achieving the opportunity that we laid out. But we see more headroom beyond that with advanced packaging. This is a very exciting trend for us. Mobility, with the pullback in handset growth over the past year or so. Anybody who follows the industry knows that, I think, RF components growth has slowed a little bit, but I think that's offset going forward especially here in 2019 by some really exciting 5G projects. We're working now on first silicon with all the leaders in the industry as they build not just the filters, but the modems and some of the 5G unique beam steering silicon that's really going to be part of what gives 5G the inherent advantages. So we're still probably early in our achievement of the incremental mobile demand. And automotive, I know there's been customers talking about the weakening of that market, continues to be pretty steady Eddie for us. A business that's not growing as fast as the other 2 opportunities in advanced packaging and mobile data, but we continue to see some solid performance out of that.

當然。因此，為了讓每個人都達成共識，我們討論了先進封裝、移動數據和汽車這 3 個組成部分，它們本質上是構成我們實現目標模型的增長驅動力，該模型帶來了 6.5 億美元的收入和非 GAAP 每股收益 1.50 美元。當我分解其中的 3 個時，我認為從我們的角度來看，在執行這些機會方面的領導者是先進封裝。無論是內存中的 HBM，我們之前已經在本次電話會議上討論過，還是集成扇出，這是我們在 10 納米和 7 納米擴展代工業務的關鍵驅動力之一。高級封裝，我們可能已經完成了實現我們所佈局的機會的 2/3、3/4。但我們看到了先進封裝之外的更多空間。這對我們來說是一個非常令人興奮的趨勢。移動性，隨著過去一年左右手機增長的回落。任何關注該行業的人都知道，我認為 RF 組件的增長有所放緩，但我認為這抵消了一些非常令人興奮的 5G 項目的影響，尤其是在 2019 年。我們現在正在與行業中的所有領導者合作開發第一塊矽，因為他們不僅構建濾波器，還構建調製解調器和一些 5G 獨特的波束控制矽，它們真正將成為賦予 5G 固有優勢的一部分。因此，我們可能仍處於實現增量移動需求的早期階段。而汽車，我知道有客戶在談論那個市場的疲軟，對我們來說埃迪仍然非常穩定。該業務的增長速度不如先進封裝和移動數據領域的其他兩個機會，但我們繼續從中看到一些穩健的表現。

That's a real helpful summary. And Shai, maybe I just can get your commentary. I don't -- as we look at the target gross margin level of 46%. How can we think about bridging the gap between where we are today with gross margins around 43.5%, up to another 250 basis points to 46%? If we broke that down into 3 or 4 buckets, how would we get from where we are now to 46%?

這是一個真正有用的總結。Shai，也許我可以得到你的評論。我沒有——因為我們看到的是 46% 的目標毛利率水平。我們如何考慮彌合我們目前毛利率約為 43.5%，再提高 250 個基點至 46% 之間的差距？如果我們將其分解為 3 或 4 個桶，我們將如何從現在的位置達到 46%？

So first, I want to remind you that in prior quarter, we have reached 45.9%, right, so -- of gross margin. So that was a great -- indicative for us that we can reach that target model. And we -- one of the things that will impact improving our gross margin as a target model is, of course, the volume. $650 million we can achieve more leverage and that will contribute to the increase. And mix, as I mentioned before, will continue to have a big impact on our business. And operational execution is also something that we focus a lot on improving yields in our factories. And we think we can also achieve more -- more leverage by cost initiative that we're taking with our companywide initiatives such as ERP integration that we made a lot of progress this year and we're going to continue to invest in next year plus specific BU initiatives, cost reductions in specific areas.

所以首先，我想提醒你，在上一季度，我們的毛利率達到了 45.9%，對，所以——毛利率。所以這對我們來說是一個很好的指示，表明我們可以達到該目標模型。而我們 - 作為目標模型將影響提高我們的毛利率的因素之一當然是數量。6.5 億美元，我們可以實現更多的槓桿作用，這將有助於增加。正如我之前提到的，混合將繼續對我們的業務產生重大影響。運營執行也是我們非常關注提高工廠產量的事情。我們認為我們還可以通過成本計劃實現更多——更多的槓桿作用，我們正在通過我們公司範圍內的計劃，例如 ERP 集成，我們今年取得了很大進展，我們將在明年繼續投資加上具體 BU 舉措，具體領域的成本削減。

I am showing no further questions at this time. I would now like to turn the conference back to Mike Slessor.

我現在沒有進一步的問題。我現在想把會議轉回 Mike Slessor。

Great. Thank you, everyone, for joining today. And we'll talk to you again in a quarter.

偉大的。謝謝大家今天的加入。我們將在一個季度內再次與您交談。

This concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連接。