IPG Photonics Corp (IPGP) 2023 Q2 法說會逐字稿

Good morning, and welcome to IPG Photonics' Second Quarter 2023 Conference Call. Today's call is being recorded and webcast. At this time, I'd like to turn the call over to your host, Mr. Eugene Fedotoff, IPG's Senior Director, Investor Relations, for introductions. Please go ahead, sir.

早上好，歡迎參加 IPG Photonics 2023 年第二季度電話會議。今天的通話正在錄音並進行網絡直播。現在，我想把電話轉給主持人，IPG 投資者關係高級總監尤金·費多托夫 (Eugene Fedotoff) 先生，請他介紹一下。請繼續，先生。

Thank you, Rob, and good morning, everyone. With me today is IPG Photonics CEO, Dr. Eugene Scherbakov; and Senior Vice President and CFO, Timothy Mammen. Let me remind you that statements made during the course of this call that discuss management's or the company's intentions, expectations or predictions of the future are forward-looking statements.

謝謝你，羅布，大家早上好。今天與我在一起的是 IPG Photonics 首席執行官 Eugene Scherbakov 博士；高級副總裁兼首席財務官 Timothy Mammen。讓我提醒您，在本次電話會議期間發表的討論管理層或公司的意圖、期望或對未來的預測的聲明均為前瞻性聲明。

These forward-looking statements are subject to risks and uncertainties that could cause the company's actual results to differ materially from those projected in such forward-looking statements. These risks and uncertainties are detailed in IPG Photonics' Form 10-K for the period ended December 31, 2022 and our reports on file with the Securities and Exchange Commission.

這些前瞻性陳述存在風險和不確定性，可能導致公司的實際結果與此類前瞻性陳述中的預測存在重大差異。這些風險和不確定性詳見 IPG Photonics 截至 2022 年 12 月 31 日期間的 10-K 表格以及我們向美國證券交易委員會提交的報告。

Copies of these filings may be updated by visiting the Investors section of IPG's website or by contacting the company directly. You may also find copies on the SEC's website. Any forward-looking statements made on this call are the company's expectations or predictions as of today, August 1, 2023, only.

這些文件的副本可以通過訪問 IPG 網站的投資者部分或直接聯繫該公司來更新。您還可以在 SEC 網站上找到副本。本次電話會議中所做的任何前瞻性陳述僅是該公司截至今天（2023 年 8 月 1 日）的預期或預測。

And the company assumes no obligation to publicly release any updates or revisions to any such statements. For additional details on our reported results, please refer to the earnings press, release earnings call presentation and the financial data workbook posted on the Investor Relations site. We will post these prepared remarks on our Investor Relations website following the completion of this call.

公司不承擔公開發布任何此類聲明的任何更新或修訂的義務。有關我們報告的結果的更多詳細信息，請參閱收益新聞、發布收益電話會議演示文稿以及投資者關係網站上發布的財務數據工作簿。本次電話會議結束後，我們將在投資者關係網站上發布這些準備好的評論。

With that, I'll now turn the call over to Eugene Scherbakov.

現在，我將把電話轉給尤金·謝爾巴科夫 (Eugene Scherbakov)。

Good morning, everyone. I am pleased with our performance this quarter. Second quarter revenue came and is the point of our guidance range. Despite of increased macroeconomic uncertainty, which resulted in project delays and impacted sales and outlook in industrial markets across many geographies.

大家，早安。我對我們本季度的表現感到滿意。第二季度收入來了，這是我們指導範圍的重點。儘管宏觀經濟不確定性增加，導致項目延誤並影響了許多地區工業市場的銷售和前景。

We reported another quarter of solid revenue growth in welding and cleaning applications. Now that were driven by strong sales and e-mobility and handheld welding solutions. Additionally, revenue improved in 3D printing and solar cell manufacturing applications as investment in these markets increased. Sales in flat sheet cutting applications declined year-over-year, mostly due to economic uncertainty and an increased competition in China, and continued to negatively impact on our results. However, cutting sales were up sequentially in China, North America and Japan.

我們報告焊接和清潔應用領域的收入又實現了一個季度的穩健增長。現在，這是由強勁的銷售、電動汽車和手持焊接解決方案推動的。此外，隨著對 3D 打印和太陽能電池製造應用的投資增加，這些市場的收入也有所增加。平板切割應用的銷售額同比下降，主要是由於經濟不確定性和中國競爭加劇，並繼續對我們的業績產生負面影響。然而，中國、北美和日本的銷量環比上升。

Emerging Growth product accounting for 41% of our total sales in the second quarter. We saw continued growth in AMB lasers, LightWELD, green and ultrafast lasers as well as the beam delivery, but sales declined in medical and advanced applications as well as in laser-based system and high-power pulse lasers. We have shipped our first 50-kilowatt AMB laser during the quarter and continue to invest in the international sales platforms for LightWELD. As we said on our first quarter conference call, our medical business was impacted by a large customer working through the inventory, which reduced sales in the second quarter. We expect medical sales to return to a more normal level in the third quarter and continue to focus on additional growth opportunities in the medical market.

新興增長產品佔第二季度總銷售額的 41%。我們看到 AMB 激光器、LightWELD、綠光和超快激光器以及光束傳輸的持續增長，但醫療和先進應用以及基於激光的系統和高功率脈衝激光器的銷售額下降。我們在本季度發貨了第一台 50 千瓦 AMB 激光器，並繼續投資 LightWELD 的國際銷售平台。正如我們在第一季度電話會議上所說，我們的醫療業務受到大客戶庫存的影響，這導致第二季度的銷售額減少。我們預計第三季度醫療銷售將恢復到更正常的水平，並繼續關注醫療市場的額外增長機會。

Despite a challenging operating environment, the positive results were driven by our progress in diversifying revenue and reducing our exposure to low-margin and highly competitive business. We have been focusing on products and applications, which benefits from global investment in e-mobility and renewable energy, and this strategy is yielding good results. IPG had another quarter with strong sales and e-mobility applications driven by an increase in sales to geographies outside China, primarily in North America, Europe and South Korea. EV-related investments in China slowed during the quarter, particularly into traditional prismatic cell batteries. But we are seeing the increased investment into new technologies such as large cylindrical sales and also more investment into batteries for storage applications. Our team is working on a new business opportunity for all cutting applications and electrical motor assembly. With continued adoption of electric vehicles and growth in energy storage globally, demand for batteries should quickly catch up with recent capacity additions, and we expect investment in battery manufacturing in China to be stronger next year. Meanwhile, we are seeing the increased investment in EV battery capacity outside of China and expect e-mobility orders to remain strong in the third quarter.

儘管經營環境充滿挑戰，但我們在收入多元化和減少低利潤且競爭激烈的業務方面取得的進展推動了積極的業績。我們一直專注於產品和應用，受益於全球對電動汽車和可再生能源的投資，這一戰略正在取得良好成果。 IPG 在中國以外地區（主要是北美、歐洲和韓國）的銷售增長推動了 IPG 另一個季度的銷售和電動汽車應用的強勁增長。本季度中國電動汽車相關投資放緩，尤其是對傳統棱柱形電池的投資。但我們看到對新技術的投資增加，例如大型圓柱形銷售，以及對存儲應用電池的投資增加。我們的團隊正在為所有切割應用和電機組裝尋找新的商機。隨著全球電動汽車的持續採用和儲能的增長，對電池的需求應能迅速趕上最近產能的增加，我們預計明年中國對電池製造的投資將更加強勁。與此同時，我們看到中國以外的電動汽車電池產能投資增加，預計第三季度電動汽車訂單將保持強勁。

Our welding sales are benefiting from growth and e-mobility applications where our complete solution, which includes AMD lasers and welding heads combined with our real-time weld monitoring and measuring technology, which has become as an industrial standard. LDDs real-time measurement can significantly reduce testing time, scrap costs and failed parts for the customer, making a very strong value proposition and exceptional return on investment given the yield and cost benefits. LDD also getting great acceptance in applications outside of batteries, where the final cost of defect can be very high and lead to significant recalls. We are proud to deliver multiple solution, which can significantly reduce environment impact for our customers, including our high-efficiency ECO lasers, its industry-leading wall-plug efficiency over the 50%, environment-friendly cleaning solutions and high efficiency laser diode drying and heating system.

我們的焊接銷售受益於增長和電動汽車應用，我們的完整解決方案（包括 AMD 激光器和焊頭）與我們的實時焊接監控和測量技術相結合，該技術已成為行業標準。 LDD 的實時測量可以顯著減少客戶的測試時間、報廢成本和故障零件，從而在產量和成本效益方面提供非常強大的價值主張和卓越的投資回報。 LDD 在電池以外的應用中也得到了廣泛的認可，在這些應用中，缺陷的最終成本可能非常高，並導致大量召回。我們很自豪能夠為客戶提供多種解決方案，可以顯著減少對環境的影響，包括我們的高效 ECO 激光器、業界領先的超過 50% 的電光轉換效率、環保清潔解決方案和高效激光二極管乾燥和加熱系統。

During the quarter, we continued to see strong results in our laser cleaning solutions in e-mobility and other automotive and nonautomotive applications. Laser cleaning provides sustainability benefits by reducing the use of abrasives, chemicals and dry ice cleaning. Unlike chemicals, abrasive and heat treatment cleaning process, laser cleaning doesn't impact the material that has been cleaned, does not leave toxic waste and also create a safer and cleaner environment for employees. It can be also significantly reduced water consumption, and we are seeing an increase in interest in our laser cleaning solutions for a number of different processes and applications, including the paint and corrosion removal. Another recently introduced laser solution, which is replacing the less efficient infrared bulbs for the drying and heating is gaining interest, and we have booked our first order for EV battery applications, which will be shipped in the third quarter.

本季度，我們的激光清潔解決方案在電動汽車以及其他汽車和非汽車應用中繼續取得強勁成果。激光清潔通過減少磨料、化學品和乾冰清潔的使用來提供可持續性效益。與化學品、磨料和熱處理清潔工藝不同，激光清潔不會影響已清潔的材料，不會留下有毒廢物，還為員工創造了更安全、更清潔的環境。它還可以顯著減少水消耗，我們發現人們對我們的激光清潔解決方案的興趣增加，用於許多不同的工藝和應用，包括油漆和腐蝕去除。最近推出的另一種激光解決方案正在引起人們的興趣，該解決方案正在取代效率較低的紅外燈泡以進行乾燥和加熱，我們已經預訂了電動汽車電池應用的第一份訂單，該訂單將於第三季度發貨。

The drying solution are well-received by customers and are gaining market acceptance because they significantly cut down energy consumption and reducing environment impact on legacy processes. And today, I'm happy to announce that the Board of Directors has elected Kolleen Kennedy as a new Director of the company. I'm looking forward to working with Kolleen and believe she will be a great contributor to IPG's strategy, particularly with our growth in medical applications, given her 25 years of experience in the medical system manufacturing industry.

該干燥解決方案深受客戶好評，並正在獲得市場認可，因為它們顯著降低了能源消耗並減少了對傳統工藝的環境影響。今天，我很高興地宣布，董事會已選舉科琳·肯尼迪 (Kolleen Kennedy) 為公司新董事。我期待著與 Kolleen 合作，並相信她將為 IPG 的戰略做出巨大貢獻，特別是考慮到她在醫療系統製造行業擁有 25 年的經驗，尤其是我們在醫療應用領域的增長。

I would like to thank our employees for their strong contribution in the quarter, and will now turn the call over to Tim to discuss financial highlights.

我要感謝我們的員工在本季度做出的巨大貢獻，現在將電話轉給蒂姆討論財務亮點。

Thank you, Eugene, and good morning, everyone. My comments generally will follow the earnings call presentation, which is available on our Investor Relations website. I will start with the financial review on Slide 4.

謝謝尤金，大家早上好。我的評論通常會在收益電話會議演示之後發表，該演示可以在我們的投資者關係網站上找到。我將從幻燈片 4 上的財務審查開始。

Revenue in the second quarter was $340 million, a decline of 10% year-over-year, partially due to foreign currency headwinds, which accounted for approximately 2% of the decrease and the telecom divestiture that reduced revenue by approximately 1%. Revenue from materials processing applications decreased 8% year-over-year while revenue from other applications decreased 23%.

第二季度收入為 3.4 億美元，同比下降 10%，部分原因是外匯不利因素（約佔下降的 2%）以及電信剝離導致收入減少約 1%。來自材料加工應用的收入同比下降 8%，而來自其他應用的收入則下降 23%。

GAAP gross margin was 43.4%, a decrease of 230 basis points year-over-year due to higher cost of products sold and charges for scrap, which were partially offset by lower inventory reserves, reduced shipping costs and tariffs as well as an improvement in absorption of manufacturing costs as a percentage of sales. On a sequential basis, gross margin continued to improve as we focused on reducing costs and improving manufacturing efficiency. We also benefited from slightly lower inventory provisions and shipping costs.

GAAP 毛利率為 43.4%，同比下降 230 個基點，原因是銷售產品成本和廢品費用增加，但庫存儲備減少、運輸成本和關稅減少以及生產成本改善部分抵消了這一影響。吸收製造成本佔銷售額的百分比。從環比來看，由於我們專注於降低成本和提高製造效率，毛利率持續改善。我們還受益於庫存準備金和運輸成本的略微降低。

As mentioned before, FX headwinds also had a negative impact in the quarter. If exchange rates relative to the U.S. dollar had been the same as 1 year ago, we would have expected revenue to be $9 million higher and gross profit to be $5 million higher. GAAP operating income was $72 million, and operating margin was 21.2%. Net income was $62 million or $1.31 per diluted share. The effective tax rate in the quarter was 24% and was benefited by certain discrete items.

如前所述，外匯逆風也對該季度產生了負面影響。如果相對於美元的匯率與 1 年前相同，我們預計收入將增加 900 萬美元，毛利潤將增加 500 萬美元。 GAAP 營業收入為 7200 萬美元，營業利潤率為 21.2%。淨利潤為 6200 萬美元，即稀釋後每股收益 1.31 美元。本季度的有效稅率為 24%，受益於某些離散項目。

Foreign currency transaction expense related to remeasuring foreign currency assets and liabilities to period-end exchange rates had a negative impact on operating income of $1 million, with net of a tax benefit had no material impact on earnings per share. Excluding the currency transaction loss and a restructuring charge, operating expenses declined year-over-year, primarily in research and development and general and administrative categories as we reduced spending on telecom product development implemented tighter cost controls and reduced expenses.

與根據期末匯率重新計量外幣資產和負債相關的外幣交易費用對營業收入產生了 100 萬美元的負面影響，扣除稅收優惠後，對每股收益沒有重大影響。不包括貨幣交易損失和重組費用，運營費用同比下降，主要是在研發以及一般和行政類別，因為我們減少了電信產品開發支出，實施了更嚴格的成本控制並減少了費用。

Moving to Slide 5. Sales of high-power CW lasers decreased 10% and represented approximately 43% of total revenue. Sales of ultra high-power lasers above 6-kilowatt represented 50% of total high-power CW laser sales with customers outside of China moving to higher powers. The decline in revenue was primarily due to lower demand in flat sheet cutting applications as a result of softer demand and competition in China. Pulse laser sales decreased 24% year-over-year as strong growth in cleaning and solar cell applications was offset by lower demand in foil cutting and marking applications. System sales declined 1% year-over-year with growth in LightWELD, offset by a decline in other laser and non-laser systems. Medium power laser sales increased 18% driven by increased demand in welding and 3D printing applications, while QCW laser sales were down 2% year-over-year. Other product sales decreased due to lower revenue in medical and advanced applications.

轉到幻燈片 5。高功率連續激光器的銷售額下降了 10%，約佔總收入的 43%。 6千瓦以上超高功率激光器的銷量佔高功率連續激光器總銷量的50%，中國以外的客戶正在轉向更高功率。收入下降的主要原因是中國需求疲軟和競爭加劇導致平板切割應用需求下降。脈衝激光器銷售額同比下降 24%，原因是清潔和太陽能電池應用的強勁增長被箔片切割和打標應用需求的下降所抵消。隨著 LightWELD 的增長，系統銷售額同比下降 1%，但被其他激光和非激光系統的下降所抵消。由於焊接和 3D 打印應用需求增加，中功率激光器銷售額增長了 18%，而 QCW 激光器銷售額同比下降 2%。由於醫療和先進應用領域的收入下降，其他產品銷售額也有所下降。

Looking at our performance by region on Slide 6. Revenue in North America decreased by 11% with strong growth in welding and cleaning applications, offset by lower sales in advanced and medical applications, lower cutting revenue and the divestiture of the telecom business. In Europe, sales increased 4%, driven by growth in welding and cleaning applications despite overall uncertainty in the economy. At the recent laser show in Europe, the tone of our business was muted with most customers expecting a slowdown in the second half of 2023. Revenue in China decreased 28% year-over-year as demand declined across most markets and applications compared to the prior year with the exception of cleaning and 3D printing.

從幻燈片 6 中按地區劃分的業績來看。由於焊接和清潔應用領域的強勁增長，北美地區的收入下降了 11%，但被先進和醫療應用領域的銷售額下降、削減收入下降以及電信業務剝離所抵消。在歐洲，儘管經濟總體存在不確定性，但受焊接和清潔應用增長的推動，銷售額增長了 4%。在最近舉行的歐洲激光展上，我們的業務基調很平靜，大多數客戶預計 2023 年下半年業務增長放緩。由於大多數市場和應用的需求較去年同期下降，中國的收入同比下降 28%與去年相比，清潔和 3D 打印除外。

Moving to a summary of our balance sheet and cash flow on Slide 7. We ended the quarter with cash, cash equivalents and short-term investments of $1.1 billion and repaid $16 million of debt in the quarter. Cash provided by operations was $67 million, and capital expenditures were $26 million during the quarter. We now expect capital expenditures to be between $130 million and $140 million this year. Our inventories decreased slightly, and we continue to target further reduction in inventories during the second half of the year. While maintaining a strong balance sheet, we have been returning a significant amount of capital to shareholders over the last year and in the first quarter. We did not repurchase shares in the second quarter. As previously reported, the Board announced a new $200 million share repurchase authorization in May, and we have a new 10b-18 repurchase plan in place. We intend to repurchase shares opportunistically.

接下來是幻燈片 7 上我們的資產負債表和現金流的摘要。本季度結束時，我們的現金、現金等價物和短期投資為 11 億美元，並在本季度償還了 1600 萬美元的債務。本季度運營提供的現金為 6700 萬美元，資本支出為 2600 萬美元。我們目前預計今年的資本支出將在 1.3 億至 1.4 億美元之間。我們的庫存小幅下降，下半年我們繼續目標是進一步減少庫存。在保持強勁的資產負債表的同時，我們在去年和第一季度向股東返還了大量資本。我們第二季度沒有回購股票。正如之前報導的，董事會於 5 月份宣布了新的 2 億美元股票回購授權，並且我們已經制定了新的 10b-18 回購計劃。我們打算趁機回購股票。

Moving to our outlook on Slide 9. Second quarter book-to-bill was below 1. We continue to see uncertain macroeconomic condition and soft orders in all major manufacturing regions. Leading indicators in North America and Europe point to contraction in the industrial markets, while the timing of demand recovery in China remains uncertain. However, despite the weaker business conditions overall, the e-mobility sector was not affected in Europe and North America, and we're still seeing solid activity in orders in e-mobility for the third quarter. Furthermore, we expect to see normalizing demand in medical and advanced applications as well as the systems business, which should help to offset headwinds in the rest of the business.

轉向我們對幻燈片 9 的展望。第二季度訂單出貨比低於 1。我們繼續看到宏觀經濟狀況不確定，所有主要製造地區訂單疲軟。北美和歐洲的領先指標表明工業市場萎縮，而中國需求復甦的時間仍不確定。然而，儘管整體商業狀況疲軟，歐洲和北美的電動汽車行業並未受到影響，我們仍然看到第三季度電動汽車訂單的強勁活動。此外，我們預計醫療和先進應用以及系統業務的需求將正常化，這將有助於抵消其他業務的不利因素。

For the third quarter of 2023, IPG expects revenue of $300 million to $330 million. The company expects third quarter gross margin to be between 40% and 42%. IPG anticipates delivering earnings per diluted share in the range of $0.85 to $1.15 with approximately 47.5 million diluted common shares outstanding. As discussed in the safe harbor passage of today's earnings press release, our guidance is based upon current market conditions and expectations, assume exchange rates referenced in our earnings press release and is subject to risks outlined in the safe harbor and the company's reports with the SEC.

IPG 預計 2023 年第三季度收入為 3 億至 3.3 億美元。該公司預計第三季度毛利率將在40%至42%之間。 IPG 預計稀釋後每股收益將在 0.85 至 1.15 美元之間，稀釋後流通普通股約為 4750 萬股。正如今天收益新聞稿的安全港段落中所討論的，我們的指導基於當前的市場狀況和預期，假設我們的收益新聞稿中引用的匯率，並受到安全港和公司向 SEC 提交的報告中概述的風險的影響。

With that, we'll be happy to take your questions.

這樣，我們將很樂意回答您的問題。

(Operator Instructions) Our first question comes from Ruben Roy with Stifel.

（操作員說明）我們的第一個問題來自 Stifel 的 Ruben Roy。

Tim, I wanted to drill in a little bit further into the commentary around cutting. It sounded like the weakness was sort of weighted more towards the softer demand than competition in China. But can you remind us where -- kind of as a percentage of revenues in China cutting stat stands? And was the comment on competition in China broader, meaning that did it encompass EV as well?

蒂姆，我想進一步深入了解有關剪輯的評論。聽起來這種疲軟更多地是由於需求疲軟而不是中國的競爭造成的。但您能否提醒我們，削減統計數據佔中國收入的百分比是多少？對中國競爭的評論是否更廣泛，意味著它也包括電動汽車？

No, the comment on competition in China was really around the cutting market and not around the EV market. We continue to have a very strong presence on foil cutting, cleaning and welding applications globally. Our cutting within China is certainly a much smaller share of the total sales there now. We had said at the end of last quarter that it was less than 10% of consolidated sales, and it remains quite well below that level, the high-power cutting business in China. It was pretty stable from Q1 to Q2, but it certainly didn't perform well.

不，對中國競爭的評論實際上是圍繞切割市場而不是電動汽車市場。我們在全球箔片切割、清潔和焊接應用領域繼續保持強大的影響力。目前，我們在中國的銷售量佔總銷售額的比例肯定要小得多。我們在上季度末曾表示，這一比例還不到合併銷售額的 10%，而且仍遠低於中國大功率切割業務的水平。從第一季度到第二季度，它相當穩定，但表現肯定不佳。

I appreciate that. And as a follow-up, Tim, can we talk a little bit about gross margins and some of the puts and takes? Good quarter here. Obviously, we're going into a little bit of a lower revenue environment in Q3. So thinking through sort of the rest of the year, you've got potentially some improving productivity coming up in the new factory in Poland and potentially New Hampshire. How are you thinking about gross margin playing out through the rest of the year?

我很感激。作為後續行動，蒂姆，我們可以談談毛利率和一些看跌期權嗎？這裡好季度。顯然，我們在第三季度將進入收入略有下降的環境。因此，考慮到今年剩下的時間，波蘭和新罕布什爾州的新工廠的生產力可能會有所提高。您如何看待今年剩餘時間的毛利率？

Yes. We were actually very pleased with the sequential improvement in gross margin following the sequential improvement in Q1. So getting back up to a more reasonable level, certainly below our longer-term target level still. In Q3, really, the difference is just on lower revenue levels, the absorption of manufacturing costs will be lower. So going through the remainder of the year, it will really depend upon where the tone of the business ends up and into next year, hopefully, with an improving outlook, we'd expect to see gross margins pick up again. But it really is just on the fixed cost base. You start to see some under-absorption at the guidance level we're at in Q3.

是的。事實上，我們對第一季度毛利率的連續改善感到非常滿意。因此，回到更合理的水平，肯定仍低於我們的長期目標水平。事實上，第三季度的區別只是收入水平較低，製造成本的吸收也會較低。因此，在今年剩下的時間裡，這實際上取決於業務的基調最終如何，到明年，希望隨著前景的改善，我們預計毛利率將再次回升。但這實際上只是基於固定成本。您開始在第三季度的指導水平上看到一些吸收不足的情況。

Our next question comes from James Ricchiuti with Needham & Company.

我們的下一個問題來自 Needham & Company 的 James Ricchiuti。

So it sounds like you're seeing -- you've seen some softening in the EV-related business in China. I'm wondering if you could talk more broadly about what you're seeing in the market outside of China. And Tim, maybe you could help size this EV business in Q2, how it fared just versus Q1? And to the extent you can, what that represents of that EV business, how much is battery welding right now?

所以聽起來你看到了——中國的電動汽車相關業務出現了一些疲軟。我想知道您是否可以更廣泛地談談您在中國以外的市場上看到的情況。蒂姆，也許你可以幫助調整第二季度電動汽車業務的規模，與第一季度相比，它的表現如何？在某種程度上，這代表了電動汽車業務，目前電池焊接的費用是多少？

Yes. So the -- we are seeing some softness in the demand cycle in China really related to the capacity additions that have already been built out there. You also started to see a transition more of the cylindrical battery investment. We think that's actually going to be a big driver next year as capacity utilization picks up. In the rest of the world, the demand cycle for EV has actually been pretty robust and strong. I'd say it's strongest in North America and then followed by Europe. There's good demand out of South Korea and even in Japan as well. It's still dominated by battery applications. We're diversifying the battery applications. Again, we've got the first orders for the drying equipment. We're starting to see some demand for additional foil cutting applications. There are some cleaning applications on some of the main body in -- mainly in North America, that's coming from, and there are some complete systems. We're selling into that. I'd still say, though, it's still very much battery-driven motor manufacturing is still a sort of ancillary application in that area.

是的。因此，我們看到中國需求週期的一些疲軟確實與那裡已經建成的產能增加有關。您還開始看到更多圓柱電池投資的轉變。我們認為，隨著產能利用率的提高，這實際上將成為明年的一大推動力。在世界其他地區，電動汽車的需求週期實際上相當強勁。我想說北美最強，然後是歐洲。韓國甚至日本的需求也很大。它仍然以電池應用為主。我們正在使電池應用多樣化。我們再次收到了乾燥設備的第一批訂單。我們開始看到對額外箔片切割應用的一些需求。主要在北美的一些主體上有一些清潔應用程序，並且有一些完整的系統。我們正在推銷這一點。不過，我仍然想說，電池驅動的電機製造仍然是該領域的一種輔助應用。

And this where (inaudible) is roughly -- what is your rough...

這（聽不清）大致是——你的大致情況是什麼……

Yes. So we're still well above 20% of went above 20% of sales in Q2.

是的。因此，我們第二季度銷售額的 20% 仍遠高於 20%。

And also we'll see in Europe trend to achieve this production, shift production or better it to the final production of cars. And you see it indefinitely for a few of our customers in Europe and also in the United States.

我們還將在歐洲看到實現這種生產、轉移生產或更好地轉向汽車最終生產的趨勢。對於我們歐洲和美國的一些客戶來說，您會無限期地看到這種情況。

Got it. And my follow-up question is on the bookings trends. You mentioned book-to-bill below 1, and I'm wondering if you could provide any more granularity on that. And how it may be varying by region and including what you're seeing perhaps in the consumer electronics market, which I don't think you mentioned at all in your prepared text?

知道了。我的後續問題是關於預訂趨勢。您在 1 以下提到了訂單到賬單，我想知道您是否可以提供更多詳細信息。以及它可能如何因地區而異，包括您可能在消費電子市場中看到的情況，我認為您在準備好的文本中根本沒有提到這一點？

Yes. We said that it was softer, of course, all of our major industrial geographies that would be Europe, U.S. and China. We actually had some pretty positive order flow out of Japan, which is holding up quite well. And South Korea also performed pretty well too. That's sort of the -- sort of married up to what you're seeing on some of the PMI data out there. Sorry, James, what was the second part of your question?

是的。我們說過，當然，我們所有的主要工業地區，即歐洲、美國和中國，都比較疲軟。實際上，我們從日本流出了一些相當積極的訂單，而且勢頭良好。而韓國隊的表現也相當不錯。這有點與您在一些 PMI 數據中看到的情況相結合。抱歉，詹姆斯，你問題的第二部分是什麼？

Well, just on some of the end markets, I mean, I assume that the legacy automotive is slower. I didn't hear any comments about some of the other end markets, including consumer electronics, which in the past, you've seen some seasonality in terms of orders. What does that market look like for you?

好吧，我的意思是，就某些終端市場而言，我認為傳統汽車的速度較慢。我沒有聽到任何關於其他一些終端市場的評論，包括消費電子產品，在過去，您在訂單方面看到了一些季節性。您認為這個市場是什麼樣的？

Yes. I mean that will be reflected mostly in the QCW sales, which were down slightly year-over-year. So there's no great traction in consumer electronics. The other positive areas on applications were really cleaning and then additive manufacturing was actually -- cleaning was very strong globally. Additive manufacturing is okay in Europe and was actually very strong in China with a couple of the OEMs that we work very closely with there, and additive there, we've been qualified because of the quality and the reliability of the lasers.

是的。我的意思是，這將主要反映在 QCW 銷量上，該銷量同比略有下降。因此，消費電子產品沒有太大吸引力。應用的其他積極領域是真正的清潔，然後增材製造實際上是——清潔在全球範圍內非常強大。增材製造在歐洲還不錯，實際上在中國也很強大，我們與那裡的幾家原始設備製造商密切合作，在增材製造方面，我們由於激光器的質量和可靠性而獲得了資格。

And cleaning application for us is very important because we are shipping not only pump laser or CW laser for the size kind of applications, but final systems for cleaning.

清潔應用對我們來說非常重要，因為我們不僅運輸用於尺寸類型應用的泵浦激光器或連續激光器，而且還運輸用於清潔的最終系統。

(Operator Instructions) Our next question comes from Michael Feniger with Bank of America.

（操作員說明）我們的下一個問題來自美國銀行的 Michael Feniger。

The inventories came down 3% quarter-on-quarter. I know that's been a target for you guys to make improvements there. But with book-to-bill less than 1x and some of the PMIs low, I'm just curious to how you're thinking about inventories in the back half? Do we need to take out more? Are you trying to position to get to a certain level to get -- just to position yourself for 2024, any ways to kind of think about that in the back half?

庫存環比下降3%。我知道這一直是你們改進的目標。但由於訂單出貨比不到 1 倍，而且一些 PMI 較低，我只是好奇你們如何看待下半年的庫存？我們需要取出更多嗎？您是否正在嘗試定位以達到某個水平，以便為 2024 年做好定位，有什麼方法可以在後半段考慮這一點嗎？

Yes, we continue to be very focused on managing inventory. And we're not seeing some of the same supply chain issues that we had experienced for the last couple of years. So we continue to target bringing inventory down during the second half of the year and generating cash out of that. In the medium term, let's say, we want to get down to less than 200 days inventory on hand and ultimately get back to a more normalized inventory level, which would be somewhere around 180 days, but that may take a bit longer to get to. But we're definitely looking to take some additional cash out of inventory and are pleased with the progress that we've made to date this year. And certainly, it's a significant change as compared to the investment in inventory we felt that was necessary last year.

是的，我們仍然非常注重庫存管理。我們沒有看到過去幾年遇到的一些相同的供應鏈問題。因此，我們繼續致力於在下半年降低庫存並從中產生現金。比如說，從中期來看，我們希望將手頭庫存降至 200 天以下，並最終恢復到更正常的庫存水平，即 180 天左右，但這可能需要更長的時間才能達到。但我們肯定希望從庫存中獲得一些額外的現金，並對今年迄今為止取得的進展感到滿意。當然，與我們去年認為必要的庫存投資相比，這是一個重大變化。

Great. And Tim, just following up on the question around the production footprint. It sounds like what's weighing on the gross margin, among other things, is the under-absorption that you kind of talked about the volumes. Are you still confident with the change with the Poland and raising production in the U.S. that -- with your cost base as we think about those gross margin targets, maybe not for obviously Q3 or Q4, just maybe longer term?

偉大的。蒂姆，只是跟進有關生產足蹟的問題。聽起來，影響毛利率的因素之一是您所說的銷量吸收不足。您仍然對波蘭的變化和美國產量的提高充滿信心嗎？當我們考慮這些毛利率目標時，您的成本基礎可能不是明顯的第三季度或第四季度，只是可能是長期的？

Definitely, our goal to optimize our cost. First of all, for production of some of components like fiber blocks and others for our lasers. And of course, working (inaudible) this way. By the way, in Poland, we will increase our production dramatically and we will increase further to the end of this quarter. The same situation in Italy. We also increased our production for these components and also in Germany. And every time we -- of course, it's under our control to cost of these components because it's influenced finally exactly to our gross margin. Situation in the United States, much more farther because it's an expensive country. But nevertheless, we are looking forward to make the final optimization of our cost first of all, for fiber components production.

當然，我們的目標是優化成本。首先，用於生產一些組件，如光纖塊和其他激光器組件。當然，以這種方式工作（聽不清）。順便說一句，在波蘭，我們將大幅增加產量，並將進一步增加到本季度末。意大利也有同樣的情況。我們還增加了這些組件以及在德國的產量。當然，每次我們都會控制這些組件的成本，因為它最終會影響我們的毛利率。美國的情況要遠得多，因為它是一個物價昂貴的國家。但無論如何，我們期待首先對纖維組件生產的成本進行最終優化。

Great. And then just on Europe, Europe, we're hearing from other industrial companies that kind of are flagging a weakening in Germany and Europe, the last month or so. Your growth was pretty resilient, even up a little bit in Germany. Just curious what you're kind of seeing there with the underlying demand versus your ability to offset that it looks like in some areas?

偉大的。然後就歐洲而言，歐洲，我們從其他工業公司那裡聽到，上個月左右德國和歐洲的經濟疲軟。你們的增長相當有彈性，甚至在德國還有一點增長。只是好奇您在那裡看到的潛在需求與您在某些領域抵消這種需求的能力之間的關係如何？

Yes. I mean, certainly, during the quarter, Europe was performing pretty reasonably and particularly compared to a year ago. The weaker guidance reflects some of the softness that other people are seeing. For us, that's translating into Q3. There are positives and negatives, right? Some of the industrial OEM business is a bit weaker, where some of the welding applications have held up quite well and things like cleaning are also performing well in Europe. But yes, I mean the PMIs in Europe are at 43%. They're some of the weakest they've been for quite a long time. And I think that the German economy is quite weak at the moment. So we'll have to see how long it takes for that to turn around.

是的。我的意思是，當然，在本季度，歐洲的表現相當合理，尤其是與一年前相比。較弱的指導反映了其他人看到的一些疲軟情緒。對我們來說，這就是第三季度。有積極的一面，也有消極的一面，對嗎？一些工業 OEM 業務稍弱一些，其中一些焊接應用表現良好，而清潔等業務在歐洲也表現良好。但是，是的，我的意思是歐洲的 PMI 為 43%。他們是很長一段時間以來最弱的人之一。我認為德國經濟目前相當疲軟。所以我們必須看看這種情況需要多長時間才能扭轉。

Our next question comes from Mark Miller with The Benchmark Company.

我們的下一個問題來自 The Benchmark Company 的馬克·米勒 (Mark Miller)。

You mentioned there was a large customer inventory adjustment in the U.S. Could you give a little more color what type industry was that from?

您提到美國進行了大規模的客戶庫存調整，您能否詳細說明一下，該調整來自什麼類型的行業？

Yes. Mark, obviously, medical applications, which we'd called out on Q1 would be weaker in the second quarter, and now we're expecting a recovery in medical application sales in Q3, the customers worked through their inventory adjustment that they've signaled to us would happen in the second quarter.

是的。馬克，顯然，我們在第一季度呼籲的醫療應用程序在第二季度將會疲軟，現在我們預計第三季度醫療應用程序銷售將復蘇，客戶已經表示他們已經進行了庫存調整對我們來說，這將在第二季度發生。

Any opportunities such as in the consumer or consumer electronics area related to AI UC coming up?

諸如在消費或消費電子領域等與 AI UC 相關的機會即將出現嗎？

I mean there's some announcements out there that there's one of the major smartphone manufacturers -- is going to be using more additive manufacturing in their processes. That would be an opportunity for us, given the strength that we have within the additive manufacturing processes around the world. I think -- I mean that would be one of the more significant opportunities that's been talked about. As you mentioned, the consumer electronics investment cycle overall with QCW lasers and even pulse lasers being relatively anemic is not strong outside of that right now.

我的意思是，有一些公告稱，主要智能手機製造商之一將在其流程中使用更多增材製造。考慮到我們在世界各地增材製造工藝方面的實力，這對我們來說將是一個機會。我認為——我的意思是，這將是人們討論過的更重要的機會之一。正如您所提到的，除了 QCW 激光器甚至脈衝激光器相對貧乏之外，消費電子產品的整體投資週期目前並不強勁。

We have reached the end of the question-and-answer session. I would now like to turn the call back over to Eugene Fedotoff for closing comments.

我們的問答環節已經結束。我現在想將電話轉回尤金·費多托夫（Eugene Fedotoff）以徵求結束意見。

Thanks for joining this morning and for your continued interest in IPG. We will participate in a number of investor events this quarter and are looking forward to speaking with you over the coming weeks. Have a great day, everyone.

感謝您今天上午的加入以及您對 IPG 的持續關注。本季度我們將參加許多投資者活動，並期待在未來幾週內與您交談。祝大家有個美好的一天。

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.

今天的會議到此結束。此時您可以斷開線路，我們感謝您的參與。