微晶片科技 (MCHP) 2025 Q4 法說會逐字稿

Greetings, and welcome to Microchip's Q4 and FY25 financial results conference call. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎參加 Microchip 第四季和 25 財年財務業績電話會議。（操作員指示）提醒一下，本次會議正在錄音。

It is now my pleasure to introduce your host, Mr. Steve Sanghi, the Executive Chair, CEO and President. Thank you, and you may proceed, sir.

現在我很高興介紹您的主持人、執行主席、執行長兼總裁史蒂夫桑吉先生。謝謝您，先生，您可以繼續。

Thank you, operator, and good afternoon, everyone.

謝謝接線員，大家下午好。

During the course of this conference call, we will be making projections and other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such statements are predictions and that actual events or results may differ materially. We refer you to our press releases of today as well as our recent filings with the SEC that identify important risk factors that may impact Microchip's business and results of operations.

在本次電話會議期間，我們將對未來事件或公司未來財務表現做出預測和其他前瞻性陳述。我們希望提醒您，此類聲明僅為預測，實際事件或結果可能存在重大差異。請您參閱我們今天的新聞稿以及我們最近向美國證券交易委員會提交的文件，其中列出了可能影響微晶片業務和經營績效的重要風險因素。

In attendance with me today are Rich Simoncic Microchip's COO, Eric Bjornholt, Microchip's CFO; and Sajid Daudi, Microchip's Head of Investor Relations. I will provide an update on our restructuring Eric will go over fourth quarter fiscal year 2025 financial performance, and Rich will then review some product line updates. I will then provide an overview of the current business environment and our first quarter fiscal year 2026 guidance. We will then be available to respond to specific investor and analyst questions.

今天與我一起出席的還有 Microchip 的營運長 Rich Simoncic、Microchip 的財務長 Eric Bjornholt；以及 Microchip 投資者關係主管 Sajid Daudi。我將提供有關我們重組的最新情況，Eric 將介紹 2025 財年第四季的財務業績，然後 Rich 將審查一些產品線更新。然後，我將概述當前的商業環境和我們 2026 財年第一季的指導。然後我們將回答投資者和分析師的具體問題。

Since I returned as Microchip's CEO on November 18, 2024, I have spent a significant amount of time evaluating key aspects of Microchip's business. On March 3, 2025, I provided an update on our 9-point recovery plan to set the company on a course to achieve its previous premium status of performance. Today, I will give you a brief update on our progress on that 9-point plan.

自 2024 年 11 月 18 日我重返微晶片執行長職位以來，我花了大量時間評估微晶片業務的關鍵方面。2025 年 3 月 3 日，我更新了我們的 9 點復甦計劃，以使公司走上實現先前優質業績的道路。今天，我將向大家簡單介紹一下九點計畫的進展。

The first action was to resize our manufacturing footprint. (inaudible) Fab two is now closed. The actions in our other two fabs, namely Fab 4 in Oregon and Fab 5 in Colorado Springs are complete. The actions in our back-end Philippines facilities are also complete. These actions reduce capacity, but leaves the fabs in a position to ramp capacity rapidly when needed on short notice.

第一個舉措是調整我們的製造足跡。（聽不清楚）Fab two 現已關閉。我們的另外兩座晶圓廠，即俄勒岡州的 Fab 4 和科羅拉多斯普林斯的 Fab 5 的作業已經完成。我們菲律賓後端設施的行動也已完成。這些措施雖然減少了產能，但使得晶圓廠能夠在短時間內迅速提高產能。

The second action was to reduce our inventory. Our inventory at the end of December 2024 was 266 days. Our target inventory is 130 to 150 days. Our inventory at March 31, 2025 was 251 days, making it the first meaningful reduction in days of inventory in three years. In the March quarter, we had reduced production for only part of the quarter, we will have reduced production for all of the June quarter.

第二個行動是減少庫存。截至2024年12月底，我們的庫存為266天。我們的目標庫存是130至150天。截至 2025 年 3 月 31 日，我們的庫存為 251 天，這是三年來庫存天數首次顯著減少。在三月季度，我們僅減少了部分季度的產量，而整個六月季度我們都會減少產量。

Thus, we expect to reduce inventory more substantially in this June quarter. The inventory at the end of June is expected to be between 215 and 225 days. During the fiscal year 2026 ending March 31, 2026, our goal is to reduce inventory by over $350 million, which will liberate cash.

因此，我們預計今年六月季度庫存將大幅減少。預計6月底庫存將在215至225天之間。在截至 2026 年 3 月 31 日的 2026 財年，我們的目標是減少庫存超過 3.5 億美元，這將釋放現金。

The third action was a review of our mega trends and total system solution. We made two changes to our megatrends. First, we replaced 5G with artificial intelligence. And second, we replaced ADAS with network and connectivity. ADAS is now part of network and connectivity, which is essentially the movement of data outside of the data center, such as Industry 4.0 and automotive networking.

第三個行動是回顧我們的大趨勢和整體系統解決方案。我們對大趨勢做了兩項改變。第一，我們用人工智慧取代了5G。其次，我們用網路和連線取代了 ADAS。ADAS 現在是網路和連接的一部分，本質上是資料中心外部資料的移動，例如工業 4.0 和汽車網路。

The fourth action was to conduct a business unit by business unit deep dive. This was completed and resulting organization changes were made.

第四項行動是針對每個業務部門進行深入研究。該工作已完成，並進行了組織變革。

The fifth action was a review of Microchip's channel strategy. This action was also completed and resulting changes have been made in our channel strategy. We have not seen any negative impact from these changes in our distribution channel.

第五個舉措是檢視Microchip的通路策略。這項行動也已完成，並對我們的通路策略做出了相應的改變。我們尚未看到這些變化對我們的分銷管道產生任何負面影響。

The 6-point of evaluation was to strengthen our customer relationships. We met with over 700 customers in the past 130-plus days giving customers a chance to communicate with us candidly. The results are in based on customer feedback. Recall that we had said that at 12% of the customers our relationship has deteriorated through the COVID cycle. Within this 12%, we have already been able to restore 78% of these customers to either approved or preferred status.

評估的6點是加強我們的客戶關係。在過去的130多天裡，我們與700多位客戶見面，讓客戶有機會與我們坦誠溝通。結果是根據客戶回饋得出的。回想一下，我們曾說過，在 COVID 週期中，我們與 12% 的客戶的關係惡化了。在這 12% 中，我們已經能夠將 78% 的客戶恢復到認可或優先狀態。

Leaving only 2.6% of the customers where our relationship remains stressed and in need of more restoration effort.

僅剩下 2.6% 的客戶，我們與他們的合作關係仍然緊張，需要付出更多努力來修復。

At this point, we will continue to work our customer relationships as a normal course of business and believe that this concern is closed and behind us. Point 7 was the long-term business model, which we unveiled on March 3. Point 8 was achieving our operating expense model. We completed a global layup of approximately 10% of our employees to bring our expenses down. We plan to continue to improve our operating expense percentage through revenue growth, attrition and controlling other operating expenses.

此時，我們將繼續按照正常業務流程維護我們的客戶關係，並相信這項擔憂已經消失。第 7 點是長期商業模式，我們在 3 月 3 日公佈了這個模式。第 8 點是實現我們的營運費用模型。我們在全球裁減了約 10% 的員工，以降低開支。我們計劃透過增加收入、減少人員流失和控制其他營運費用來繼續提高我們的營運費用百分比。

The ninth and final area was the chipset activity. We reinitiated our discussions with the chips office. The chip's office is still reorganizing under the new administration. With that, I will pass the call over to Eric Bjornholt.

第九個也是最後一個領域是晶片組活動。我們重新與晶片辦公室展開了討論。在新政府的領導下，晶片辦公室仍在重組。說完這些，我會把電話轉給 Eric Bjornholt。

Thanks, Steve, and good afternoon, everyone. We are including information in our press release and on this conference call on various GAAP and non-GAAP measures. We have posted a full GAAP to non-GAAP reconciliation on the Investor Relations page of our website at www.microchip.com, and included reconciliation information in our earnings press release which we believe you will find useful when comparing our GAAP and non-GAAP results. We have also posted a summary of our outstanding debt and our leverage metrics on our website.

謝謝，史蒂夫，大家下午好。我們在新聞稿和電話會議中提供了有關各種 GAAP 和非 GAAP 指標的資訊。我們已在我們的網站 www.microchip.com 的投資者關係頁面上發布了完整的 GAAP 與非 GAAP 對帳表，並在我們的收益新聞稿中包含了對帳信息，我們相信您在比較我們的 GAAP 和非 GAAP 結果時會發現這些資訊很有用。我們也在我們的網站上發布了未償債務和槓桿指標的摘要。

I will now go over some of the operating results, including net sales, gross margin and operating expenses. Other than net sales, I will be referring to these results on a non-GAAP basis, which is based on expenses prior to the effects of our acquisition activities, share-based compensation and certain other adjustments as described in our earnings press release and in the reconciliation on our website.

我現在將介紹一些經營業績，包括淨銷售額、毛利率和營業費用。除淨銷售額外，我將以非 GAAP 為基礎引用這些結果，該結果基於我們的收購活動、股權激勵以及收益新聞稿和我們網站上的對帳表中所述的某些其他調整的影響之前的費用。

Net sales in the March quarter were $970.5 million, which was down 5.4% sequentially and $10.5 million above the midpoint of our guidance provided on February 6, 2025. We have posted a summary of our net sales by product line and geography on our website for your reference. On a non-GAAP basis, gross margins were 52%, including capacity underutilization charges of $54.2 million, operating expenses were at 38% of sales and operating income was 14% of sales. Non-GAAP net income was $61.4 million and non-GAAP earnings per diluted share was $0.11, which was $0.01 above the midpoint of our guidance.

3 月季度的淨銷售額為 9.705 億美元，季減 5.4%，比我們 2025 年 2 月 6 日提供的預期中位數高出 1,050 萬美元。我們已在網站上發布了按產品線和地區劃分的淨銷售額摘要，供您參考。以非公認會計準則計算，毛利率為 52%，其中包括 5,420 萬美元的產能未充分利用費用，營運費用佔銷售額的 38%，營運收入佔銷售額的 14%。非公認會計準則淨收入為 6,140 萬美元，非公認會計準則每股攤薄收益為 0.11 美元，比我們的預期中位數高出 0.01 美元。

On a GAAP basis, in the March quarter, gross margins were 51.6%, Total operating expenses were $601.4 million and included acquisition intangible amortization of $122.6 million. special charges of $71.6 million, which was primarily driven by foundry contract exit costs and employee separation costs. Share-based compensation was $37.2 million and $1.4 million of other expenses. The GAAP net loss attributable to common shareholders was $156.8 million or $0.29 per share.

以 GAAP 計算，3 月季度的毛利率為 51.6%，總營運費用為 6.014 億美元，其中包括 1.226 億美元的收購無形資產攤銷。特殊費用為 7,160 萬美元，主要由於代工合約退出成本和員工離職成本。股權激勵費用為 3,720 萬美元，其他費用為 140 萬美元。歸屬於普通股股東的 GAAP 淨虧損為 1.568 億美元，即每股 0.29 美元。

For fiscal year 2025, net sales were $4.42 billion, and were down 42.3% from net sales in fiscal year 2024. On a non-GAAP basis, gross margins were 57%. Operating expenses were 32.5% of sales and operating income was 24.5% of sales. Non-GAAP net income was $708.8 million and EPS was $1.31 per diluted share. On a GAAP basis, gross margins were 56.1% and Operating expenses were 49.3% of sales and operating income was 6.7% of sales.

2025財年的淨銷售額為44.2億美元，較2024財年的淨銷售額下降42.3%。以非公認會計準則計算，毛利率為57%。營業費用佔銷售額的32.5%，營業收入佔銷售額的24.5%。非公認會計準則淨收入為 7.088 億美元，每股收益為 1.31 美元。依照 GAAP 標準，毛利率為 56.1%，營業費用佔銷售額的 49.3%，營業收入佔銷售額的 6.7%。

The GAAP net loss attributable to common shareholders was $2.7 million.

歸屬於普通股股東的 GAAP 淨虧損為 270 萬美元。

Our non-GAAP cash tax rate was 13.6% in the March quarter and 14.2% for fiscal year 2025. Our non-GAAP tax rate for fiscal year '26 is expected to be about 12%, and which is exclusive of the transition tax and any tax audit settlements related to taxes accrued in prior fiscal years. Our inventory balance at March 31, 2025, was $1.293 billion and was down $62.8 million from the balance at December 31, 2024. We had 251 days of inventory at the end of the March quarter, which was down 15 days from the prior quarter's level, driven by our inventory reduction actions. Included in our March ending inventory was 18 days of a long life cycle, high-margin products whose manufacturing capacity has been end-of-life by our supply chain partners.

我們的非公認會計準則現金稅率在 3 月季度為 13.6%，在 2025 財年為 14.2%。我們 26 財年的非公認會計準則稅率預計約為 12%，其中不包括過渡稅以及與前幾財年累計稅款相關的任何稅務審計結算。截至 2025 年 3 月 31 日，我們的庫存餘額為 12.93 億美元，比 2024 年 12 月 31 日的餘額減少了 6,280 萬美元。受庫存減少措施的推動，截至 3 月底，我們的庫存天數為 251 天，比上一季減少了 15 天。我們三月的期末庫存包括生命週期為 18 天、利潤率較高的產品，這些產品的生產能力已被我們的供應鏈合作夥伴終止。

Inventory at our distributors in the March quarter was at 33 days, which was down 4 days from the prior quarter's level. Distribution took down their inventory in the March quarter as distribution sell-through was about $103 million higher than distribution sell-in.

3 月季度，我們經銷商的庫存為 33 天，比上一季減少了 4 天。由於分銷銷售額比分銷銷售額高出約 1.03 億美元，分銷部門在 3 月季度減少了庫存。

Our cash flow from operating activities was $205.9 million in the March quarter. Our adjusted free cash flow was $182.6 million in the March quarter. As of March 31, our consolidated cash and total investment position was $771.7 million. In the March quarter, we completed a $1.485 billion mandatory convertible preferred stock offering with a 3-year term and purchased the cap call that is generally expected to reduce or offset potential dilution to the common stock upon conversion of the preferred stock with such reduction subject to an initial cap price of $71.40 per share.

3 月季度我們的營運活動現金流為 2.059 億美元。我們的三月季度調整後自由現金流為 1.826 億美元。截至 3 月 31 日，我們的綜合現金和總投資狀況為 7.717 億美元。在三月份季度，我們完成了價值 14.85 億美元的強制性可轉換優先股發行，期限為 3 年，併購買了上限要求，通常預計該要求將減少或抵消優先股轉換時對普通股的潛在稀釋，但這種減少須遵守每股 71.40 美元的初始上限價格。

The mandatory preferred convertible transaction was done to reduce our debt and preserve our investment-grade rating. Our total debt decreased by $1.125 billion in the March quarter, and our net debt decreased by $1.31 billion. Our adjusted EBITDA in the March quarter was $200.4 million and 20.6% of net sales. Our trailing 12-month adjusted EBITDA was $1.337 billion, our net debt to adjusted EBITDA was [ 3.66 ] at March 31, 2025. Capital expenditures were $14.2 million in the March quarter and $126 million for fiscal year 2025.

強制性優先可轉換交易是為了減少我們的債務並保持我們的投資等級評級。我們的總債務在 3 月季度減少了 11.25 億美元，淨債務減少了 13.1 億美元。我們 3 月季度的調整後 EBITDA 為 2.004 億美元，佔淨銷售額的 20.6%。我們過去 12 個月的調整後 EBITDA 為 13.37 億美元，截至 2025 年 3 月 31 日，我們的淨債務與調整後 EBITDA 比率為 [ 3.66 ]。3 月季度的資本支出為 1,420 萬美元，2025 財年的資本支出為 1.26 億美元。

Our expectation for capital expenditures for fiscal year 2026 is to be at or below $100 million. Depreciation expense in the March quarter was $41.2 million. I will now turn it over to Rich, who will provide some commentary on our product line innovations in the March quarter. Rich?

我們預計 2026 財年的資本支出將達到或低於 1 億美元。3 月季度的折舊費用為 4,120 萬美元。現在我將把時間交給 Rich，他將對我們三月季度的產品線創新提供一些評論。富有的？

Thank you, Eric, and good afternoon, everyone. During this quarter, we have continued to execute our strategic initiatives that deliver value across multiple markets. Our investments in next-generation technologies like the Switchtec PCIe switches enable us to adapt and deploy technologies initially developed for high-speed data centers into automotive and embedded computing applications. These advancements create new capabilities in applications where accelerated communication performance is critical, such as software-defined vehicles and robotics.

謝謝你，埃里克，大家下午好。本季度，我們持續執行在多個市場創造價值的策略性措施。我們對 Switchtec PCIe 交換器等下一代技術的投資使我們能夠將最初為高速資料中心開發的技術應用並部署到汽車和嵌入式運算應用中。這些進步在加速通訊性能至關重要的應用（例如軟體定義的汽車和機器人）中創造了新的功能。

We are strengthening our core portfolio through advancements in our ARM-based microprocessors for human machine interface applications and our 32-bit microcontrollers integrated with high-performance analog peripherals that serve industrial, consumer, medical and AIML markets. These high-speed peripherals and other analog related functionality, reduce the need for external analog components, decreased system complexity and cost and deliver high-performance solutions.

我們透過改進用於人機介面應用的基於 ARM 的微處理器以及整合高效能類比週邊裝置的 32 位元微控制器來加強我們的核心產品組合，這些微控制器服務於工業、消費、醫療和 AIML 市場。這些高速週邊和其他模擬相關功能減少了對外部模擬元件的需求，降低了系統複雜性和成本，並提供了高效能解決方案。

Our innovative MPLAB AI coding assistant is helping customers accelerate their design cycles, reducing their embedded software development time and increasing productivity by as much as 40%. We continue to enhance this tool with additional features and functionality. Additionally, our new PIC 64 product line continues to gain momentum and new design opportunities for the space, industrial automation, automotive and edge compute. Our recently launched 10 based T1S solutions continue to see market adoption with a growing design funnel. These innovations, coupled with our operational efficiency efforts demonstrate our commitment to driving top line growth and improved profitability as we continue to bringing differentiated solutions to our target markets.

我們創新的 MPLAB AI 編碼助理正在幫助客戶加快設計週期，減少嵌入式軟體開發時間並將生產力提高 40%。我們將繼續增強此工具的附加特性和功能。此外，我們的新 PIC 64 產品線繼續在太空、工業自動化、汽車和邊緣運算領域獲得發展動力和新的設計機會。我們最近推出的基於 10 個 T1S 的解決方案繼續得到市場採用，設計管道也不斷擴大。這些創新加上我們的營運效率努力表明了我們致力於推動收入成長和提高獲利能力，同時繼續為目標市場提供差異化的解決方案。

With that, I will pass the call to Steve for comments about our business and guidance going forward. Steve?

說完這些，我將把電話轉給史蒂夫，請他對我們的業務和未來指導發表評論。史蒂夫？

Thank you, Rich. As Eric described in his prepared remarks, our March quarter net sales were $970.5 million, down 5.4% sequentially and and down 26.8% from the year ago quarter as we navigated through a very large inventory correction following a post-COVID super cycle. Our revenue from our microcontroller and analog business units was down sequentially. FPGA was about flat and other business were up sequentially mainly driven by technology licensing. Geographically, our business was seasonally down sequentially in Americas and Asia and was seasonally up in Europe.

謝謝你，里奇。正如 Eric 在其準備好的發言中所描述的那樣，由於我們經歷了 COVID 超級週期之後的一次非常大的庫存調整，我們 3 月份季度的淨銷售額為 9.705 億美元，環比下降 5.4%，比去年同期下降 26.8%。我們的微控制器和模擬業務部門的收入連續下降。FPGA 基本持平，其他業務則是環比成長，主要受技術授權的推動。從地理上看，我們的業務在美洲和亞洲出現季節性下滑，而在歐洲則出現季節性成長。

Now let's get into our guidance for the June quarter. We believe substantial inventory destocking has occurred at our customers, channel partners and their downstream customers. While we believe the inventory at our customers, channel partners and downstream customers will continue to correct the customers and distributors are starting to increase their purchases. As a result, I am finally calling the last quarter as a revenue bottom for us. Our bookings were up significantly in the March quarter, after nearly three years of book-to-bill ratio well below 1.0, our book-to-bill ratio in the March quarter was a very healthy 1.07.

現在讓我們來看看六月季度的指導。我們相信，我們的客戶、通路合作夥伴及其下游客戶已經出現了大量庫存去庫存的情況。雖然我們相信客戶、通路合作夥伴和下游客戶的庫存將持續調整，但客戶和經銷商也開始增加採購量。因此，我最終將上個季度稱為我們的收入底部。我們的訂單量在三月季度大幅上升，在近三年的訂單出貨比遠低於 1.0 之後，三月季度的訂單出貨比達到了非常健康的 1.07。

Our backlog for the June quarter started out higher than the starting backlog for the March quarter. The bookings in the month of April were higher than any month in the March quarter. Taking all of these factors into account, we expect our net sales for the June quarter to be $1.045 billion, plus or minus $25 million. We expect our non-GAAP gross margin to be between 52.2% and 54.2% of sales. We expect our non-GAAP operating expenses to be between 33.4% and 34.8% of sales.

我們六月季度的積壓訂單量一開始就高於三月季度的積壓訂單量。四月份的預訂量高於三月份當季的任何一個月。考慮到所有這些因素，我們預計 6 月季度的淨銷售額為 10.45 億美元，上下浮動 2,500 萬美元。我們預計非公認會計準則毛利率將介於銷售額的52.2%至54.2%之間。我們預計非公認會計準則營運費用將佔銷售額的 33.4% 至 34.8%。

We expect our non-GAAP operating profit to be between 17.4% and 20.8% of sales. We expect our non-GAAP diluted earnings per share to be between $0.18 and $0.26.

我們預計非公認會計準則營業利潤將佔銷售額的 17.4% 至 20.8% 之間。我們預計非公認會計準則每股攤薄收益在 0.18 美元至 0.26 美元之間。

There are a couple of things I want to highlight in our guidance. The first is the leverage in our business model. With a $74.5 million increase in net sales at the midpoint of the guidance for the June quarter, we are taking approximately 85% of it to the bottom line as non-GAAP operating profit. As the inventory drains further, and inventory write-offs decrease, our gross margin recovery will accelerate. And with the incremental profits going to the bottom line, we will have tremendous leverage.

我想在我們的指導中強調幾點。首先是我們商業模式中的槓桿作用。根據 6 月季度指引中位數，淨銷售額增加了 7,450 萬美元，我們將其中約 85% 作為非 GAAP 營業利潤計入利潤。隨著庫存進一步減少，庫存註銷減少，我們的毛利率恢復將會加速。隨著增量利潤進入最終階段，我們將擁有巨大的槓桿作用。

The second point I wanted to make is on the revenue growth. There are three revenue accelerators kicking in just from the inventory drain. The first is that our distributors' inventory and our distributor customers inventory is getting corrected. We're expecting the first increase in distributor sell-through after many quarters Therefore, our distributors are starting to buy more product to replenish their inventory and feed their customers' growth. Second, the distributors sell-in has to rise to meet the sales out.

我想說的第二點是關於收入成長。光從庫存消耗就可以看出有三個收入加速器在發揮作用。首先，我們的經銷商庫存和分銷商客戶的庫存正在修正。我們預計分銷商的銷售量將在多個季度後首次成長，因此，我們的經銷商開始購買更多產品來補充庫存並滿足客戶的成長需求。其次，分銷商的進貨量必須增加才能滿足銷售量。

Last quarter, sell-in revenue was $103 million lower than sell-through. If sell-in revenue were to catch up with sell-through. The sell-in revenue will rise approximately $103 million higher and will further seed sales growth.

上個季度，銷售收入比銷售總額低 1.03 億美元。如果銷售收入趕上銷售量。銷售收入將增加約 1.03 億美元，並將進一步促進銷售成長。

And third, our direct customers inventory is getting corrected, and we are starting to see the direct customer shipments increase. We believe that this trifecta effect is a compelling setup for sales growth going into this fiscal year. With sales growth, gross margin increasing and inventory declining, we expect to deliver significantly improved financial performance in this fiscal year. Now let me provide an update on our capital return program for shareholders. We are essentially returning 100% of our adjusted free cash flow to investors in the form of dividends right now.

第三，我們的直接客戶庫存正在修正，我們開始看到直接客戶出貨量增加。我們相信，這種三重效應將為本財年的銷售成長奠定堅實的基礎。隨著銷售額成長、毛利率上升和庫存下降，我們預期本財年的財務表現將大幅改善。現在，讓我向股東介紹一下我們的資本回報計劃的最新情況。我們現在基本上將 100% 的調整後自由現金流以股息的形式返還給投資者。

Due to depressed net sales, our adjusted free cash flow is currently less than our dividend. In certain quarters, we have had to make higher bond interest payments and tax payments and bond interest payments are generally made every 6 months. So every other quarter, this impacts our adjusted free cash flow and results in our dividend exceeding our adjusted free cash flow.

由於淨銷售額低迷，我們調整後的自由現金流目前低於我們的股息。在某些季度，我們必須支付更高的債券利息和稅款，債券利息通常每 6 個月支付一次。因此，每隔一個季度，這都會影響我們的調整後自由現金流，並導致我們的股利超過調整後的自由現金流。

As we begin to liberate cash from inventory coupled with very low capital expenditures, we expect to bring the adjusted free cash flow above the dividend. In future quarters, we intend to use this excess cash to bring our borrowings back down to at least the levels they were at before our dividend exceeded our adjusted free cash flow. We're not considering any cut to the dividend our financial activity last quarter, in which we raised $1.4 billion in mandatory convertible preferred transaction improved our balance sheet and reaffirmed our investment grade debt rating. With that, operator, will you please poll for the questions?

隨著我們開始從庫存中釋放現金，再加上非常低的資本支出，我們預計調整後的自由現金流將高於股息。在未來幾個季度，我們打算利用這些多餘的現金將我們的借款至少降至股息超過調整後的自由現金流之前的水平。我們沒有考慮削減股息，上個季度我們的財務活動籌集了 14 億美元強制性可轉換優先交易，改善了我們的資產負債表，並重申了我們的投資等級債務評級。接線員，請問您可以調查問題嗎？

(Operator Instructions) Harsh Kumar, Piper Sandler.

（操作員指示）Harsh Kumar、Piper Sandler。

Steve. First of all, let me add my congratulations to the recovery. I know it's been a long time coming, but we've seen you call bottoms in the past, and I'm excited that you see the bottom. But the question we get, Steve, though from a lot of our clients or investors is that maybe talk about the demand signals that you're seeing, which you kind of did, but there is also another aspect of maybe potential pull-ins from tariffs. If you could just help us understand why this may not be a head fake from that?

史蒂夫。首先，我要對你的康復表示祝賀。我知道這已經持續了很長時間，但我們過去曾看到你預測底部，我很高興你看到了底部。但是，史蒂夫，我們從許多客戶或投資者那裡得到的問題是，也許談論您所看到的需求訊號，您確實這樣做了，但還有另一個方面，也許是關稅的潛在吸引力。如果您能幫助我們理解為什麼這可能不是假動作嗎？

And then also, if you could just -- I'll ask my second question here. If you could just talk about the recovery that you're seeing relative to your key end markets, if there's one that's acting better than the other or they're both acting the same?

然後，如果你可以的話——我將在這裡提出我的第二個問題。如果您可以談談您所看到的相對於主要終端市場的復甦情況，其中一個市場的表現是否比另一個市場更好，或者兩個市場的表現是否相同？

So thank you, Harsh. The demand signals we are seeing really began in -- starting early January, our January, February, March, each of those three months bookings were significantly higher than December quarter bookings, and we have shown them on a slide and on the March three conference call that we had, and that was really before any of the tariffs talk appeared. So we're really not seeing any tariff-related activity or pull in. If you look at downstream customers' information, many of the direct customers that were not buying the product are starting to buy it because the inventory is getting depleted.

所以謝謝你，Harsh。我們看到的需求訊號實際上始於 1 月初，1 月、2 月、3 月這三個月的預訂量都明顯高於 12 月季度的預訂量，我們在幻燈片和 3 月第三次電話會議上都展示了這一點，而這實際上是在任何關稅談判出現之前。所以我們確實沒有看到任何與關稅相關的活動或拉動。如果你查看下游客戶的訊息，你會發現許多以前沒有購買該產品的直接客戶現在也開始購買該產品，因為庫存正在減少。

Same way at the distributors they are starting to buy additional amount of product because on many of the SKUs, their inventory has gone back to very much normal. And our distributors' customers also downstream customers their inventory is getting corrected. So all of the signals we have really are related to that and a number of -- large number of designs that we were designed in last year. Many of them are turning to production. So there is also growth coming from new products and new design win activity.

同樣，分銷商也開始購買額外的產品，因為對於許多 SKU 而言，他們的庫存已經恢復到正常水準。我們的分銷商的客戶以及下游客戶的庫存正在修正。因此，我們擁有的所有訊號實際上都與此有關，並且與我們去年設計的大量設計有關。其中許多企業正在轉向生產。因此，新產品和新設計獲勝活動也帶來了成長。

We haven't seen any impact of tariffs. Tariffs are largely exempted on all the semiconductors that we make today, whether shipping into China or shipping into US.

我們尚未看到關稅的任何影響。我們今天生產的所有半導體基本上都免徵關稅，無論是運往中國還是運往美國。

The second one was related to the key end markets.

第二個與關鍵終端市場有關。

So if we look at the last year's data, fiscal year '25 ending March 31, the notable thing that stands out is aerospace and defense. The aerospace and defense used to be 11% of our business in the prior year. In fiscal '25, that is now 17% -- 18%, and it's almost the second largest market now after industrial. And the underlying reasons are that business has stayed strong. Defense budgets have been high NATO has been increasing their defense spending and with two awards going on while the automotive industrial communication consumer, other businesses were weak.

因此，如果我們查看去年的數據，截至 3 月 31 日的 25 財年，最引人注目的就是航空航太和國防。去年，航空航太和國防業務占我們業務的 11%。在 25 財年，這一比例現在為 17% - 18%，它幾乎是僅次於工業的第二大市場。其根本原因是業務保持強勁。國防預算一直很高，北約一直在增加國防開支，並且有兩項合約正在進行，而汽車工業通訊消費者、其他企業則表現疲軟。

So there is a notable shift in our end markets. And if you look at the year that just started on April 1, I think we headed for a first ever over $1 trillion budget for US defense. And I recently met a customer from Europe and the talk of the talk was around -- they were talking about their business growing 2x to 3x over the next three years because US

因此我們的終端市場發生了顯著的變化。如果你回顧 4 月 1 日剛開始的新一年，我認為美國國防預算將首次超過 1 兆美元。我最近遇到了一位來自歐洲的客戶，他們談論的重點是——他們說他們的業務將在未來三年內成長 2 到 3 倍，因為美國

was pushing NATO to dramatically increase their defense spending, and they're a major contractor to NATO and European defense. So I think the opportunities in that segment are very good even this year, and we think that will be a very good segment. Now all the others, industrial, automotive, consumers and others we are seeing a broad-based recovery in all of those segments, embedded in our bookings, fair amount driven by inventory depletion and also driven by new designs and new products.

正在敦促北約大幅增加國防開支，他們是北約和歐洲國防的主要承包商。因此我認為今年該領域的機會仍然非常好，我們認為這將是一個非常好的領域。現在，我們看到所有其他領域，包括工業、汽車、消費品和其他領域，都出現了廣泛的復甦，這體現在我們的預訂量中，相當一部分是由庫存消耗推動的，也是由新設計和新產品推動的。

Chris Caso, Wolfe Research.

克里斯‧卡索（Chris Caso），沃爾夫研究公司。

I guess the first question, and we've been discussing this quite a bit with others during this earnings season. is what sort of macro impact that the tariff environment such will have as we go into the rest of the year? And Steve, I'm judging by your comments about improving bookings in that, that you're not seeing that? And -- but I guess the question is, what are your customers telling you right now? And from an investor standpoint, there's been a concern about pull-ins of demand from second half to now to get ahead of tariffs?

我想這是第一個問題，我們在這個收益季節已經與其他人討論過這個問題了。進入今年剩餘時間，這種關稅環境將會產生什麼樣的宏觀影響？史蒂夫，根據你關於提高預訂量的評論，我判斷你沒有看到這一點嗎？而且—但我想問題是，您的客戶現在告訴您什麼？從投資人的角度來看，人們一直擔心從下半年到現在的需求是否會趕在關稅之前？

What's your view on that?

您對此有何看法？

So I think there are two things. There is a direct impact of tariffs like the tariffs on our products as they ship anywhere into China or US and then there is an indirect effect, which is the effect on global economy and global GDP. The second one impact on global GDP below -- is above my pay grade. The customers that I have met in the last couple of weeks personally, when I ask them how you're thinking about tariffs, they turn around and asking me, how do I think about tariffs?

所以我認為有兩件事。關稅會產生直接影響，例如對我們的產品運往中國或美國時徵收的關稅，也會產生間接影響，即對全球經濟和全球 GDP 的影響。第二個對全球 GDP 的影響超越了我的薪資等級。過去幾週我親自會見的客戶，當我問他們如何看待關稅時，他們轉過身來問我，我對關稅有何看法？

And nobody knows because as we speak today, there are really no tariffs on the semiconductors.

沒有人知道，因為正如我們今天所說，半導體實際上沒有關稅。

So leaving that impact on the global GDP aside, and I'll comment a little more on that afterwards, if you look at the direct impact on us, it's basically nothing. In the [Janardan's] first term, he implemented 25% tariffs on semiconductors made in China coming into US At that time, about 10% or 11% of our parts were made in China. And we moved aggressively to move that production assembly essentially from China to Philippines, Thailand, Vietnam, Indonesia, others. And today, less than 4% of our parts are made in China.

因此，姑且不論對全球 GDP 的影響，之後我會對此發表更多評論，如果您看一下對我們的直接影響，您會發現它基本上沒有影響。在賈納丹的第一個任期內，他對進入美國的中國製造的半導體徵收 25% 的關稅，當時我們大約 10% 或 11% 的零件是在中國製造的。我們積極將生產組裝線從中國轉移到菲律賓、泰國、越南、印尼等國家。如今，我們只有不到 4% 的零件是在中國製造的。

And those don't come to US, they go to Europe, they go to Japan, they go to Southeast Asia. A handful of orders that made in China that might come to US which may become subject to tariff, basically, we passed that tariff to the customers, but it was negligible because there was really very small.

這些產品並沒有銷往美國，而是銷往了歐洲、日本和東南亞。少數在中國製造並運往美國的訂單可能會被徵收關稅，基本上，我們將這些關稅轉嫁給了客戶，但這是可以忽略不計的，因為數量真的非常少。

Now the other thing is if there is a tariff for US-made product going to China, and we're looking at it all passing it together very carefully. Many of our technologies run in US and they also run in Taiwan, and we'll try to portion our production so that the parts that are going into China are made in Taiwan or Europe or elsewhere and are not made in US And I'm sure we'll find that it's not 100%. It's a very small amount.

現在另一件事是，如果對銷往中國的美國產品徵收關稅，我們會非常謹慎地考慮如何將其轉嫁出去。我們的許多技術在美國運行，也在台灣運行，我們將嘗試分配生產，以便進入中國的零件是在台灣或歐洲或其他地方製造的，而不是在美國製造的，而且我敢肯定，我們會發現它不是 100%。這是一個非常小的數字。

So I'm really not that concerned about the direct tariffs because of that setup. Now when it comes to indirect tariff really nobody knows what the overall impact on the economy would be. So what we did for a modeling purpose inside is we took a hypothetical haircut on our revenue, and we wanted to make sure that if that kind of impact were to happen, what would happen to the inventory, what would happen to a manufacturing? Would we have to take additional actions. And the result of that very stress case analysis is that we have already cut back our manufacturing so much that with this haircut, our inventory still declining slower than in the normal plan but inventory is declining because the production rate today would still be lower than the worst-case scenario that we have modeled.

因此，由於這種設置，我實際上並不擔心直接關稅。現在談到間接關稅，實際上沒有人知道它對經濟的整體影響是什麼。因此，我們為了進行內部建模，對收入進行了假設性削減，並希望確保如果發生這種影響，庫存會發生什麼變化，製造業會發生什麼變化？我們是否必須採取額外行動？而這種壓力案例分析的結果是，我們已經大幅削減了製造規模，儘管如此，我們的庫存下降速度仍然低於正常計劃，但庫存下降是因為今天的生產率仍然低於我們模擬的最壞情況。

Therefore, there will be no other actions required we simply would ramp our factories later because the inventory is dropping slow. I hope that's the answer to your question.

因此，我們不需要採取其他行動，我們只是稍後擴大工廠產能，因為庫存下降緩慢。我希望這就是你問題的答案。

That's a very helpful color. As my follow-up question, I wanted to dig in a little bit to the margin leverage that you referred to in your prepared remarks as well. And maybe two parts to that question. One is if you could discuss some of the charges that are acting as headwinds to gross margin now, some of the utilization charges and the reserve charges. And with the assumption that revenue starts to come back now, how does that play out over the next few quarters?

這是一種非常有用的顏色。作為我的後續問題，我想深入探討您在準備好的演講中提到的保證金槓桿。這個問題可能分為兩個部分。一是，您是否可以討論目前對毛利率產生不利影響的一些費用、一些利用費用和儲備費用。假設現在收入開始回升，那麼未來幾季的情況會如何？

And how is that leverage realized as the revenue comes back?

那麼，當收入回升時，如何實現槓桿作用呢？

Chris, this is Eric. So the two main headwinds that we have right now are the underutilization charges, which were a little over $54 million last quarter. We don't expect that to really change significantly in the current quarter. We're still going to be running the factories at a low rate as we're focused on bringing inventory down. And then the inventory reserve charges, which we provided a little bit more color on March three and when we went through the 9-point plan.

克里斯，這是艾瑞克。因此，我們目前面臨的兩個主要阻力是未充分利用的費用，而上個季度這一數字略高於 5,400 萬美元。我們預計本季這種情況不會發生重大變化。由於我們專注於降低庫存，我們仍將以低速運作工廠。然後是庫存儲備費用，我們在 3 月 3 日以及我們討論 9 點計劃時提供了更多細節。

Those are still big numbers, and we expect that inventory reserve number to still be large again in the current quarter. but they are going to start dropping pretty dramatically as revenue increases, assuming that's what happens as we go through the fiscal year because inventory is dropping at a rapid pace. Steve mentioned that we're targeting reducing inventory by about $350 million plus in the fiscal year.

這些仍然是很大的數字，我們預計本季庫存儲備數字仍然會很大。但隨著收入的增加，它們將開始大幅下降，假設我們在整個財政年度都會發生這種情況，因為庫存正在迅速下降。史蒂夫提到，我們的目標是在本財年減少約 3.5 億美元以上的庫存。

So the products that are really subject to review for reserve charge is coming down dramatically. So that should start changing pretty soon outside of this quarter. and the leverage in gross margin is going to be really high. So we aren't putting numbers around it for investors today, but it's significant.

因此，真正需要接受保留費審查的產品數量正在急劇下降。因此，本季之後這種情況很快就會開始改變。毛利率的槓桿率將會非常高。因此，我們今天不會向投資者提供相關數字，但它意義重大。

Timothy Arcuri, UBS.

瑞銀的提摩西·阿庫裡。

Eric, just on that point, so given all the actions you've taken, if we sort of get back to a point where, I mean, pick your revenue number, maybe like mid-1s back to 1.5 or something like that, with all the actions you've taken and you assume that the reserves come down and under utilization comes down, too, should we expect margins to be higher this time around than they were at the same revenue level last time? I mean, you've closed three fabs. So I would think that ultimately, margins would be higher at equivalent revenue than they were last cycle. Is that fair?

艾瑞克，就這一點而言，考慮到您採取的所有行動，如果我們回到某個點，我的意思是，選擇您的收入數字，可能是從 1 到 1.5 左右或類似的數字，考慮到您採取的所有行動，並且您假設儲備下降並且利用率也下降，那麼我們是否應該預期這次的利潤率會高於上次的相同收入水平？我的意思是，你們已經關閉了三家晶圓廠。因此我認為，最終，在同等收入的情況下，利潤率會高於上一個週期的利潤率。這樣公平嗎？

So it depends on the slope of the recovery. And I think you said we closed two fabs. We did not. We've only closed one fab, Fab two in Tempe. But it depends on the slope of the recovery and then where we're at in terms of needing to ramp our factories.

所以這取決於復甦的斜率。我想您說過我們關閉了兩座晶圓廠。我們沒有。我們只關閉了位於坦佩的一家工廠和二號工廠。但這取決於經濟復甦的速度，以及我們需要擴大工廠產能的程度。

We have higher cost inventory per unit sitting in inventory today, and that will come out on a FIFO basis. But the cost structure is in really good shape. Obviously, we gave a new long-term model of 65% non-GAAP gross margins, which we're very confident in. And I know all of you will be looking on how to model this going forward. But the leverage is significant.

我們目前庫存中每單位的庫存成本較高，而且將按照先進先出的方式處理。但成本結構確實很好。顯然，我們給了一個新的長期模型，即65%的非公認會計準則毛利率，我們對此非常有信心。我知道大家都在關注如何在未來實現這個目標。但其影響力卻十分巨大。

But I don't want to commit at this point in time in terms of a margin level at a comparable revenue level in the past. It will depend on the slope of how revenue returns there.

但就利潤水平而言，我目前還不想承諾與過去相當的收入水準。這將取決於那裡的收入回報斜率。

Okay. And then, Steve, do you have a way to determine what consumption is in June relative to your guidance? I know [ disti ] sell-through is finally growing in June. I would think that this sellers still going to be below sell-through in June. There's still some sort of slower moving MCU parts that seem to be moving a little slower.

好的。那麼，史蒂夫，你有沒有辦法確定六月的消費量相對於你的指導值是多少？我知道 6 月 [ disti ] 的銷售量終於開始成長了。我認為該賣家 6 月的銷售量仍將低於預期。仍有一些移動較慢的 MCU 零件似乎移動得比較慢。

So where do you think consumption is for June relative to what you're guiding revenue?

那麼，您認為 6 月份的消費情況相對於您預期的收入水準如何？

So our internal modeling shows that the [ disti ] sell-through, will be higher than the guidance we have given you, which is GAAP guidance based on sell-in, last quarter, the difference was $103 million. We expect the difference would be lower than that -- how much lower we can't quantify, but will be below 100%, certainly maybe well below 100%. And that the gap will continue to close in the coming quarters. which will result into one of the things that a trifecta, I talked about where the sell-in will close to equal to sell through. It's not the sell-through coming down, it's a sell-in going up.

因此，我們的內部模型顯示，分銷銷售量將高於我們給您的指導，即基於上個季度銷售量的 GAAP 指導，差額為 1.03 億美元。我們預期差異會低於這個數字——我們無法量化具體低多少​​，但會低於 100%，當然可能遠低於 100%。並且未來幾季差距將持續縮小。這將導致三連勝的結果之一，即我所說的賣出量將接近等於賣出量。這並不是銷售量的下降，而是銷售量的上升。

And the second part of the consumption is on the factory side, what are we producing and what are we consuming. And we have looked at it in our model based on our June quarter guidance we are consuming a lot of inventory and producing significantly less than what we are consuming from the inventory. So therefore, the inventory will continue to come down at an accelerated pace which will eventually lower the write-offs, and it will eventually improve the factory utilization and all of those will move in the right direction as the inventory continues to come down.

消費的第二部分是在工廠方面，我們生產什麼，我們消費什麼。根據我們六月季度的指導，我們在模型中發現，我們消耗了大量的庫存，而生產的庫存卻遠遠少於我們消耗的庫存。因此，庫存將繼續加速下降，最終將降低注銷量，並最終提高工廠利用率，隨著庫存持續下降，所有這些都將朝著正確的方向發展。

Blayne Curtis, Jefferies.

布萊恩‧柯蒂斯，傑富瑞集團。

I had two questions. I wanted to ask about kind of big picture. Your cadence has been different than other companies. If you kind of look at MCU share, maybe you guys gained a little bit too much share during the pandemic and now your share looks quite low as you're correcting where others aren't correcting as much. I'm just kind of curious as you kind of look through here, and there's been a lot of talk about share gainers and MCUs.

我有兩個問題。我想問一些總體情況。您的節奏與其他公司不同。如果你看一下 MCU 的份額，也許你們在疫情期間獲得了太多的份額，而現在你們的份額看起來很低，因為你們正在進行調整，而其他人的調整幅度卻沒有那麼大。我只是有點好奇，當你瀏覽這裡時，你會發現有很多關於份額增加者和 MCU 的討論。

Kind of just curious when things normalize, do you expect to get back to where you were pre-pandemic?

我只是好奇，當一切恢復正常時，您是否希望回到疫情前的狀態？

Well, we certainly expect to gain share. And it's a quarter at a time, but we certainly plan to gain share on the way up here as we recover. I think competitors are more closer to a full recovery than we are. I mean we just began this is the first quarter. So therefore, we should be gaining share.

嗯，我們當然希望獲得份額。雖然每次只增加四分之一，但我們確實計劃在復甦的過程中增加市場份額。我認為競爭對手比我們更接近全面復甦。我的意思是我們剛開始這是第一季。因此，我們的份額應該會增加。

And I want to ask you, there's a lot of kind of debate about China's strategy and I guess who knows how all this trade war works out, and I'm not sure they're tariffing semis in China, but I think there are a handful of companies looking to do a China-for-China strategy. I'm just kind of curious to your perspective if you think that's the right move or the wrong move. I think you're starting to hear that ASPs are lower because the costs are lower. So it might be a headwind for the overall market, that's what everybody does. Just curious to your perspective.

我想問您，關於中國戰略有很多爭論，我想誰知道這場貿易戰將如何發展，我不確定他們是否會對中國的半成品徵收關稅，但我認為有少數公司正在尋求制定針對中國的戰略。我只是有點好奇您的觀點，您是否認為這是正確的舉動還是錯誤的舉動。我想您開始聽說 ASP 較低是因為成本較低。所以這可能會對整個市場造成不利影響，每個人都會這麼做。只是好奇你的觀點。

Well, if you go back to the March three report we gave to the Street, we talked about our China for China strategy in the report. And that was built around -- we have a Chinese partner with a Chinese name and Chinese logo a Chinese website, a Chinese data sheet. And we were going to sell our die to the Chinese partner and then they were going to locally assemble and test it and put a locally made logo and then sell it to Chinese customers as a local part. But the die inside was Microchip. Now there was a time when the rules were Made in China mean, assembled in China.

好吧，如果你回顧我們三月提交給華爾街的報告，我們在報告中談到了我們的「面向中國的策略」。而這一切都建立在——我們有一個中國合作夥伴，有中文名稱、中文識別、中文網站和中文資料表。我們打算將模具賣給中國合作夥伴，然後他們在當地組裝和測試，貼上當地製造的標誌，然後將其作為本地零件出售給中國客戶。但裡面的晶片是微晶片。曾經有一段時間，規則是“中國製造”，意思是“中國組裝”。

And since then, the rules are sort of being changed, where made in China are made in US is where it is diffused, which means where it is fab, not where it's assembled. So with that rule change, our Made in China strategy, which was part made in the fab (inaudible), assembled in China and shipping in China as a local product readily doesn't work. So we are redoing our China strategy. We could still do that based on parts made in Taiwan and we can transfer some of the other products from US

從那時起，規則就發生了變化，中國製造的產品在美國製造的地方擴散，這意味著產品在哪裡生產，而不是在哪裡組裝。因此，隨著規則的改變，我們的「中國製造」策略（部分在工廠生產（聽不清楚））、在中國組裝並作為本地產品在中國運輸）很容易就行不通了。因此，我們正在重新制定中國戰略。我們仍然可以基於台灣製造的零件來實現這一點，並且可以從美國轉移一些其他產品

to Taiwan. So we'll be redoing the strategy and talk to a later point.

去台灣。因此我們將重新制定策略並稍後再討論。

The point I'd like to make on record, which we are communicating to the Trump administration to Secretary of Commerce and all that, is that the current rules are actually incentivizing moving product out of US which is opposite of what they intended. They were trying to get more people to make parts in US And we are moving mask sets as we speak from US to Taiwan, wherever we have dual source so that we don't have to pay a tariff going into China.

我想正式聲明的一點是，我們正在向川普政府、商務部長等傳達這一訊息，那就是現行規則實際上是在鼓勵將產品運出美國，這與他們的初衷背道而馳。他們試圖讓更多的人在美國生產零件，我們正在將口罩從美國運往台灣，因為我們有雙重來源，所以進入中國時我們不必支付關稅。

So we'll come back to you on the China for China strategy.

因此，我們稍後會再次向您介紹中國針對中國的戰略。

Vivek Arya, Bank of America Securities.

Vivek Arya 的美國銀行證券。

On the first one related to gross margins and pricing, so March quarter gross margins were, I think, kind of at the lower end of your outlook even though sales were slightly above. So just anything to call there? And then in general, Steve, what are you assuming for the pricing environment this year versus, say, three months ago?

第一個問題與毛利率和定價有關，因此我認為，儘管三月季度的銷售額略有上升，但毛利率處於預期的低端。那有什麼可以打電話嗎？那麼總體而言，史蒂夫，與三個月前相比，您對今年的定價環境有何看法？

The pricing environment we have assumed is basically mid-single-digit type of decrease.

我們假設的定價環境基本上是中等個位數的下降。

Yes. And I think on your question on gross margin, why it came in on the lower end versus when sales were above the midpoint it's a number of factors, but the bottom line is we continue to aggressively try to reduce inventory. So our utilization was low. And our inventory reserve charges were still high. So it's really a combination of those factors.

是的。關於毛利率的問題，我認為為什麼當銷售額高於中點時，毛利率卻處於較低水平，這有很多因素，但最重要的是我們繼續積極嘗試減少庫存。所以我們的利用率很低。我們的庫存儲備費用仍然很高。所以這其實是這些因素的綜合作用。

All right. And for my follow-up, Steve, you are calling June an inflection quarter how should this inform us about your visibility for one quarter out in September? Like if we had to think about September, should we be thinking given that June is an infection, that September should be seasonal, above seasonal? Should it kind of be in the same range as June because modeling your business when it is going through these periods of infection gets really tough, so I would appreciate any help that you could provide in how we should be thinking about quarter plus one for your business?

好的。接下來我想問的是史蒂夫，您稱 6 月為拐點季度，那麼這如何讓我們了解 9 月份一個季度的可見性呢？例如，如果我們必須考慮九月，我們是否應該考慮，鑑於六月是感染期，九月應該是季節性的，高於季節性的？它是否應該與 6 月處於同一範圍內，因為在經歷這些感染期時對您的業務進行建模會變得非常困難，因此，如果您能就我們應該如何考慮您的業務的一個季度加一提供任何幫助，我將不勝感激？

So if we look at September quarter backlog today and compare it to the June quarter backlog at the same point in time, which means June 8, just go back a quarter and what June quarter would be at the same point in time a quarter ago, the September backlog is higher than where June quarter was at the same point in time. and the slope of the fill on the crawl chart looks quite good. So if I were to say today, I'm quite optimistic about the September quarter.

因此，如果我們查看今天 9 月份季度的積壓訂單，並將其與同一時間點（即 6 月 8 日）的 6 月份季度積壓訂單進行比較，只需回溯一個季度，看看上一季度同一時間點的 6 月份季度的情況，9 月份的積壓訂單高於同一時間點的 6 月份季度的積壓訂單。而爬行圖表上的填充斜率看起來相當不錯。所以如果我今天說的話，我對九月季度相當樂觀。

Tore Svanberg, Stifel.

托爾·思文伯格，Stifel。

Yes. Thank you. So Steve, one of the organization changes was to combine the 8- and 32-bit market in core development tools under one group I was just wondering if you could clarify or talk a little bit more about what was behind that particular change and how that might impact your share in the overall microcontroller market.

是的。謝謝。史蒂夫，組織變革之一是將核心開發工具中的 8 位和 32 位市場合併到一個部門之下。我只是想知道您是否可以澄清或進一步談談這一特定變革背後的原因，以及這將如何影響您在整個微控制器市場的份額。

So the change was not combining the 8-bit and 32-bit development tools. The change was combining 8-bit and 32-bit business units, the product group, the development tool was only was always one common group, but they reported in a way that they were not totally aligned with 8- and 32-bit. The reason for the change that came out during my deep dives was 8-bit was pursuing 8-bit opportunities and 32-bit we're pursuing 32-bit opportunities. And nobody was mining the store as some of the 8-bit customers wanting to convert to 32 bit. So the 32-bit group was doing a lot of midland and high-end products and leading the low end of 32-bit vulnerable.

因此，變化並不是結合 8 位元和 32 位元開發工具。這項變更將 8 位和 32 位業務部門、產品組和開發工具結合起來，始終只是一個共同的群組，但他們報告的方式表明，他們並不完全符合 8 位和 32 位。在我深入研究後發現，發生這種變化的原因是 8 位追求 8 位機會，而 32 位追求 32 位機會。並且沒有人像一些想要轉換為 32 位的 8 位客戶那樣挖掘商店。因此，32 位部門生產了大量中階和高階產品，並導致 32 位低階產品陷入脆弱。

So when an 8-bit customer wanted to move to low-end 32-bit, we didn't have the appropriate product. So 8-bit will keep fighting with 8 bit trying to compete with a bid, but customer was trying to go to 32 bit. Remember, this 8-bit to 32-bit conversion now has been talked about for about 35 years. People were talking to me about that conversion back in 1994, and it didn't happen for forever. But it did happen during COVID, accelerated.

因此，當 8 位客戶想要轉向低階 32 位元時，我們沒有合適的產品。因此，8 位將繼續與 8 位競爭，試圖透過出價進行競爭，但客戶正試圖轉向 32 位。請記住，這個 8 位元到 32 位元的轉換已經討論了大約 35 年。1994 年人們就跟我談論過這種轉變，但它並沒有永遠發生。但它確實在新冠疫情期間發生了，而且加速了。

Parts were hard to find, so people found whatever they did and whatever parts they could find anywhere. And so a lot more designs we're able to fulfill their needs with 32-bit and they stayed with 32-bit. And going forward, they have adopted 32-bit.

零件很難找到，所以人們盡其所能，在任何地方找到任何能找到的零件。因此，我們能夠使用 32 位元來滿足更多設計的需求，而且他們仍然使用 32 位元。並且，他們已經採用了 32 位。

So since combination of those business units, we have change the developmental priorities to fill that hole. And the first of those products will be introduced to the market in early January. And we're already working with the customers to design it in because customers can design in using our -- one of the other products because the architectures are very compatible. And they would be ready to go in production with our product when it is released. So that was the change we made.

因此，自從這些業務部門合併以來，我們已經改變了發展重點來填補這一空白。首批產品將於 1 月初上市。我們已經在與客戶合作進行設計，因為客戶可以使用我們的其他產品進行設計，因為架構非常相容。當我們的產品發佈時，他們就會準備好投入生產。這就是我們所做的改變。

That's great color. As my follow-up for Eric, Eric, the $90 million to $100 million in operating expenses that you're saving from the recent restructuring, could you just talk a little bit about the linearity of that? I mean, obviously, some of it has already played out that we can see better than numbers. But any more color you could offer us for those savings for -- as we move into fiscal '26.

顏色真棒。作為我對 Eric 的後續提問，Eric，您透過最近的重組節省了 9000 萬至 1 億美元的營運費用，您能否稍微談談其中的線性關係？我的意思是，顯然，有些事情已經發生了，我們可以比數字更清楚地看到。但是，隨著我們進入 26 財年，您能否為我們提供更多關於這些節省的詳細資訊？

Yes. I would say most of it is already played in, right? If you look at where our OpEx came in for the March quarter compared to forecast, I think it was $7 million or $8 million below what our guidance to the Street was because we implemented the RIF beginning in early March. And so most of those actions were fully reflected in the guidance that we gave today for the June quarter. There still might be little small pieces to go, but most of those actions are completed at this point in time.

是的。我想說大部分內容已經播放完畢了，對嗎？如果您看一下我們 3 月季度的營運支出與預測相比的情況，我認為它比我們對華爾街的指引低了 700 萬或 800 萬美元，因為我們從 3 月初開始實施 RIF。因此，大部分行動都充分反映在我們今天給出的六月季度指引中。可能還有一些小部分需要完成，但大多數操作此時都已完成。

Harlan Sur, JPMorgan.

摩根大通的 Harlan Sur。

Steve, you already got the question on tariff-related pull-ins. And you mentioned indirect impact is above your pay grade. But it'd be fair just as a team, if you look back in the 2018, 2019 US China tariff and trade pump flick -- the Microchip team was actually the first to call out seeing order patterns dropping within your China industrial and manufacturing customers due to the demand uncertainty caused by tariff impact at that time. Is that -- does the team has somewhat of a unique profile of having very large exposure to like small and medium-sized manufacturers and they tend to modulate their activity fairly quickly and in real time?

史蒂夫，你已經了解了有關關稅相關吸引力的問題。您提到間接影響超出了您的薪酬等級。但作為一個團隊，如果回顧 2018 年、2019 年的美國中國關稅和貿易刺激計劃，那麼公平地說，微晶片團隊實際上是第一個提出由於當時關稅影響造成的需求不確定性而導致中國工業和製造業客戶的訂單模式下降的團隊。這是不是說——該團隊是否具有某種獨特的形象，對中小型製造商有非常廣泛的了解，並且他們傾向於相當快速且即時地調整他們的活動？

So given the current trade and tariff dynamics, like are you starting to see any signs of a pullback or perturbations in order activity from your small, medium-sized China manufacturing and industrial base?

那麼，鑑於當前的貿易和關稅動態，您是否開始看到中國中小型製造業和工業基地的訂單活動出現回落或擾動的跡象？

So Harlan, I don't recall between then and now, I retired for about a few years. So I don't recall what happened. But I think the tariffs were very pointed at that time only for China. This time, tariffs a lot broader in the whole world. And people are still going to be buying cars and washers and dryers and equipment and appliances.

所以哈蘭，我不記得從那時到現在，我已經退休了大約幾年。所以我不記得發生了什麼事。但我認為當時的關稅只是針對中國。這一次，關稅在全世界範圍內更加廣泛。人們仍會購買汽車、洗衣機、烘乾機、設備和電器。

And what we do see is people from China, our customers in China are rapidly moving production from China to outside of China. For example, a lot of our development tools were made in China and are supplier who builds a development tool, our contract manufacturer has moved their facility to Vietnam.

我們確實看到來自中國的人們、我們在中國的客戶正在迅速將生產從中國轉移到中國以外。例如，我們的許多開發工具都是在中國製造的，並且作為製造開發工具的供應商，我們的合約製造商已將其工廠遷至越南。

So a lot of those changes are happening, and they're accelerating now, but they've been happening for 5 years because this thing, Trump has been saying that for two years now during all these campaigns, so this is not new. So therefore, we just think that People are going to continue to build these products, but there will be a lot of movements out of China. So China may have a problem, but the world may not have as big a problem.

所以很多變化正在發生，而且正在加速，但它們已經發生了 5 年，因為川普在所有這些競選活動中已經說了兩年，所以這並不是什麼新鮮事。因此，我們認為人們將繼續生產這些產品，但中國將有大量的生產活動。因此，中國可能會有問題，但世界可能不會有那麼大的問題。

I appreciate that. And then on the six megatrends focus from fiscal '21 to fiscal '24, megatrend revenues grew at a 20% -- 26% CAGR, right? That's about 2x the growth of the overall Microchip business represented about 47% of your revenues. Can you guys just drew us up, so what was the performance of the megatrend revenues versus your total sales in fiscal '25? And what was the percentage mix of the megatrend revenues in fiscal '25?

我很感激。然後，從 21 財年到 24 財年的六大趨勢重點中，大趨勢收入以 20% - 26% 的複合年增長率增長，對嗎？這大約是整個微晶片業務成長的 2 倍，佔總收入的 47% 左右。你們能否為我們畫個圖，那麼 25 財年大趨勢收入與總銷售額的表現如何？25 財年大趨勢收入的百分比是多少？

So megatrend mix is pretty much held the same. In terms of overall revenue growth with -- in terms of overall percentage growth, that trend has diminished or slowed down mega trends are still growing above the Microchip rate in terms of CAGR. But with all of the inventory correction, megatrends were just as susceptible to inventory correction as our standard markets.

因此，大趨勢組合基本上保持不變。就整體收入成長而言－就整體百分比成長而言，這一趨勢已經減弱或放緩，但大趨勢的複合年增長率仍然高於微晶片的成長率。但隨著所有庫存調整，大趨勢與我們的標準市場一樣容易受到庫存調整的影響。

Joshua Buchalter, TD Cowen.

約書亞·布查爾特（Joshua Buchalter），TD Cowen。

You've been pretty transparent about your limited visibility as we kind of went through the tick of the inventory digested in the last few quarters. And clearly, there's been a lot of digestion and I realize we touched on it a bit, but I was wondering if you could maybe comment on what's improved from a visibility standpoint that's allowing you to conclusively say we hit the bottom here? I mean, is it simply that the bookings have gotten high enough where you're able to get a better pulse on true end demand and consumption versus inventory situation?

當我們回顧過去幾季所消化的庫存時，您對於自己有限的可見性已經非常坦誠。顯然，我們已經進行了很多消化工作，而且我意識到我們已經稍微觸及了這一點，但我想知道您是否可以從可見性的角度評論一下有哪些改進，讓您可以最終說我們已經觸底了？我的意思是，是因為預訂量已經夠高，您就能更了解真正的最終需求和消費與庫存狀況？

Well, I think there are many pieces of it. So one of them is the distribution sales out is increasing after many, many quarters. So distribution is selling more to their end customers, which means -- in some cases, the end customers' inventory is getting corrected. So distribution is shipping more. So that's one.

嗯，我認為有很多部分。其中之一就是分銷銷售額經過多個季度後開始增加。因此分銷商向最終客戶銷售更多產品，這意味著——在某些情況下，最終客戶的庫存正在糾正。因此分銷就是運送更多的貨品。這就是其中之一。

Number two, the bookings in March quarter were up significantly from any prior quarter and bookings in April were higher than any other month, January, February or March. That's number two. And number three, when you look at the crawl chart, so crawl chart essentially on a daily basis looks at what we have built for the quarter and where do we have bookings aged in the quarter. So if no more bookings come in, in the quarter, that's the number we're going to be for the quarter. And you can compare those crawl charts, one quarter versus the other at the same point in time.

第二，三月的預訂量比前幾季都大幅增加，四月的預訂量也高於一月、二月或三月等任何其他月份。這是第二個。第三，當您查看抓取圖表時，抓取圖表基本上每天都會查看我們為本季建立了什麼，以及我們在本季的預訂情況如何。因此，如果本季沒有更多的預訂進來，那麼這就是我們本季的數字。您可以比較同一時間點的一個季度與另一個季度的爬行圖表。

So the June quarter starting backlog was higher than March quarter on the first day of the quarter. And if I look at it now on May 8 and compare it to February 8 the backlog for June quarter on May is substantially higher than at the same point in time on February 8.

因此，6 月份季度的起始積壓訂單量在本季第一天就高於 3 月份季度。如果我現在在 5 月 8 日查看並將其與 2 月 8 日進行比較，5 月份 6 月季度的積壓量明顯高於 2 月 8 日同期。

And then when you look at the backlog for the September quarter, compared it to March or compared to June, it's higher than both of them and slope at which it's increasing is also higher, which means customers are increasingly thinking of buying more because either the inventory is correcting or they have a new product that's going into production. So it's multifaceted.

然後，當您查看九月份季度的積壓訂單時，將其與三月或六月進行比較，您會發現它比前兩個季度都高，並且增長的斜率也更高，這意味著客戶越來越多地考慮購買更多產品，因為要么是庫存正在調整，要么是他們有新產品即將投入生產。所以它是多方面的。

And then I think you mentioned more sustained shutdowns in the June quarter. Can you elaborate on how you're thinking about the cadence of this? I think in the past, you've done some two weak ones. And clearly, you're getting more aggressive now. Should we think about sort of the sustained lower production levels until you hit, I think it's 130 to 150 day on books inventory targets and similar to where you feel comfortable in the channel?

然後我想您提到了 6 月季度更持續的停工。可以詳細說明一下你是如何看待這個節奏的嗎？我認為過去你做過兩件不太好的事情。顯然，你現在變得更加激進了。我們是否應該考慮持續較低的生產水平，直到您達到，我認為這是 130 到 150 天的圖書庫存目標，類似於您在渠道中感到舒適的水平？

So there are two factories where we are still working a little bit of rotating time off. One is the Oregon facility where we could have brought it down further but we didn't bring it up as low because it will get below a critical mass. We brought it to a point lower, and then we are running at two weeks rotating time out of 13. And the reason for that is that is a factory where all our advanced products are. And by having a 2-weeks rotating time off, we can ramp it very rapidly by just removing the rotating time off.

因此，我們在兩家工廠仍實行輪班休息制。一個是俄勒岡州的工廠，我們本來可以進一步降低產量，但我們沒有將其降低到那麼低，因為它將低於臨界質量。我們將其降低到較低的水平，然後我們以每 13 週一次的輪換時間運行兩週。原因在於，那裡是我們所有先進產品的生產工廠。透過實施兩週的輪班休假，我們只需取消輪班休假就可以快速提高效率。

We're not doing the same thing in Colorado. We're not doing the same thing in Philippines. That facility was unique in the products it builds, that's why we decided to do it that way. Now our plan is to run the production at these levels, which is well below really what we are shipping today so that the inventory could come down.

我們在科羅拉多州沒有做同樣的事情。我們在菲律賓沒有做同樣的事情。該工廠生產的產品獨一無二，這就是我們決定這樣做的原因。現在我們的計劃是以這些水平進行生產，這遠低於我們今天實際發貨的數量，以便庫存可以下降。

But your last part of your question is, would we continue to run this way till our inventory comes down to 130 to 150 days. And the answer to that is not. And the reason for that is, if you wait until the inventory comes down to 130 to 150 days, then for the following quarter, your inventory can't decline anymore because you really kind of size you may have to grow your capacity 40%, 50% in a single quarter because we're running so much below consumption plus revenue is growing. So therefore, you have to model it where you have to start growing capacity or start growing production a few quarters ahead of time. So you don't have a hill to climb that you can climb in rehiring and retraining people.

但你問題的最後一部分是，我們是否會繼續這樣運行，直到我們的庫存降至 130 至 150 天。答案是否定的。原因是，如果你等到庫存降至 130 至 150 天，那麼對於下一季度，你的庫存就不會再下降，因為你可能需要在一個季度內將產能提高 40% 或 50%，因為我們的產能遠低於消費量，而且收入還在增長。因此，你必須對其進行建模，提前幾季開始擴大產能或增加產量。因此，在重新僱用和重新培訓員工方面你不需要克服任何困難。

So we don't believe that inflection point is in this quarter or next quarter. But as we progress through the fiscal year, we could get there where we need to start and start ramping the factories.

因此，我們不認為拐點會出現在本季或下個季度。但隨著財政年度的進展，我們可以到達我們需要開始的地方並開始擴大工廠規模。

William Stein, Truist Securities.

威廉·斯坦（William Stein），Truist Securities。

Great Steve, I appreciate all the clarifications you've provided. I wanted to dig into the question -- earlier question about China for China. And as I recall, the business update the March time frame. I thought that you talked about your -- some of the product in your portfolio little longer being meaningfully competitive in China, especially, I think what you characterized as standard products. And I thought that was the reason for this partnership.

太棒了，史蒂夫，我很感謝你提供的所有澄清。我想深入探討一下之前關於中國的問題。我記得，業務更新的時間框架是三月。我認為您談到了您的產品組合中的某些產品在中國不再具有競爭力，特別是您所說的標準產品。我認為這就是我們建立這種合作關係的原因。

Now it sounds like that strategy has changed. So can you talk about your competitive positioning in China going forward? And how -- if some of your products are less competitive how that influences the total, I think it's called total solution selling strategy that you have?

現在聽起來該策略已經改變。那麼，您能談談未來您在中國市場的競爭定位嗎？如果您的某些產品競爭力較弱，這會對整體產生什麼影響？我認為這就是所謂的「整體解決方案銷售策略」嗎？

I think -- I don't know if you misunderstood, but I don't think we set our products are less competitive. There's a push from the Chinese government to the local industry to design in the local products. And so a lot of the customers want to use a local product to check that box. Now when we talk to the customers, they like the Western product better than the local product, but they're under pressure from Chinese government. So if you can provide them the product with Western quality, Western design, Western Speck, but under a local brand, then you get the best of both world.

我認為——我不知道您是否誤解了，但我並不認為我們所設定的產品缺乏競爭力。中國政府正在推動本土產業設計本土產品。因此，許多顧客希望使用本地產品來滿足這項要求。現在，當我們與客戶交談時，他們更喜歡西方產品而不是本土產品，但他們面臨來自中國政府的壓力。因此，如果您能為他們提供具有西方品質、西方設計、西方特色，但採用本地品牌的產品，那麼您就能獲得兩全其美的效果。

So that's what we were trying to do to provide our Western made product under the Chinese logo from a local company. And many of the customers are telling yes, that's exactly what I want.

因此，我們嘗試透過當地公司的中文標誌來提供西方製造的產品。許多顧客都說是的，這正是我想要的。

Now what happened then is that they changed the definition of where it is made up, it used to be assemblies where the product is formed, changes shape significantly, and they redefine that to where it is diffused, which means where it is fat. So therefore, all of the US-made product won't fit into the China for China strategy, all of our parts made in Taiwan and Germany and Japan and everywhere else will fit, but that's not a complete portfolio. So we are redoing that strategy and may land up building relationships with some of our US-made products are also made in Taiwan or elsewhere, but I don't want to rush to it we are already transferring some of our mask sets where the process already runs in Taiwan at one of the foundries, but we're not forming new relationships to transfer our US product. Instead, we're giving feedback to the government that the strategy is having an opposite effect where there's an incentive to move US

現在發生的事情是，他們改變了產品的組成地點的定義，它曾經是產品形成、形狀發生顯著變化的組裝地點，他們將其重新定義為產品擴散的地點，也就是脂肪的地點。因此，並非所有美國製造的產品都適合「中國產」策略，我們在台灣、德國、日本和其他地方生產的所有零件都適合，但這不是一個完整的產品組合。因此，我們正在重新制定這項策略，並可能最終與一些在美國製造的產品建立關係，這些產品也在台灣或其他地方製造，但我不想倉促行事，我們已經將一些掩模版轉移到已經在台灣的一家代工廠運行的工廠，但我們不會建立新的關係來轉移我們的美國產品。相反，我們向政府反饋，該戰略正在產生相反的效果，因為有動力將美國

production out. But if there is no change in the strategy and the current rules continue another few weeks, then we will probably start to move from US production elsewhere.

生產出來。但如果戰略沒有改變，現行規則再持續幾週，那麼我們可能會開始將生產從美國轉移到其他地方。

Will, I think maybe where some of the confusion came is we talked about how -- where we have seen some and may see more competition over time from China-based companies and semiconductors is in the kind of the lower end of the standard microcontroller and analog products. but we won't see it in kind of our higher-end, more complex products, at least not in the near term.

威爾，我認為也許一些混淆來自於我們談論的——我們已經看到一些並且可能隨著時間的推移看到來自中國公司和半導體的更多競爭，這些競爭集中在標準微控制器和模擬產品的低端領域。但我們不會在更高端、更複雜的產品中看到它，至少在短期內不會。

Vijay Rakesh, Mizuho.

瑞穗的 Vijay Rakesh。

Just a quick question. On the Section 232, talking about bringing product back to the US, what are you contemplating? How are you looking at that? What's the time frame for that? And a follow-up.

這只是一個簡單的問題。關於第 232 條，談到將產品帶回美國，您在考慮什麼？您對此有何看法？時間框架是怎樣的？以及後續行動。

(inaudible) for what?

（聽不清楚）為了什麼？

Just wondering if you're expecting any Section 232 to rulings coming down in terms of trying to bring product back to the US.

我只是想知道您是否期待根據第 232 條做出任何有關將產品運回美國的裁決。

Well, I just finished explaining that we're taking product from US to elsewhere. The current rules are such that produce the product anywhere, but don't produce them in China and don't produce them in US You're in best shape, if you stay away from US and you stay away from China, because China hits US

好吧，我剛剛解釋完我們正在將產品從美國運送到其他地方。現行規則是，產品可以在任何地方生產，但不要在中國生產，也不要在美國生產。最好遠離美國，也遠離中國，因為中國打擊美國

and US in China. So if you produce elsewhere, you love by everybody else. So I think that's the -- those are the rules the way I understand it today. But we are the rules are changing every day, and we will do whatever the appropriate thing to do is, we have a fair amount of overlap in our products where we produce them in US

以及美國在中國。因此，如果你在其他地方生產，你會受到所有人的喜愛。所以我認為這就是——這些就是我今天所理解的規則。但規則每天都在變化，我們會採取適當的措施，我們的產品在美國生產時有相當多的重疊。

and produce them in Taiwan on many of our products. And some other products we produce them in Germany, and we produce them in Japan. But as the rules continue to change, we will evolve that strategy to ensure that we're best positioned with whatever the final rules are.

並在我們的許多產品上採用台灣生產。其他一些產品我們在德國生產，也在日本生產。但隨著規則的不斷變化，我們將改進策略，以確保無論最終規則是什麼，我們都能處於最佳位置。

Got it. And then talk about visibility. Just wondering how you are looking at utilization, I guess, across the fabs as you go to the back half, if you have some visibility there in terms of demand or how we should see that going?

知道了。然後討論可見性。我只是想知道，當您進入後半部分時，您如何看待整個晶圓廠的利用率，您是否對需求方面有一些了解，或者我們應該如何看待這種情況？

We guided that the June quarter inventory is somewhere between 215 and 225 days. If I just kind of project ahead in September, I think it drops below 200. I don't know what the exact number would be. And our goal is 130 to 150 days longer term. So somewhere between that 150 and 200 there is a number at which we need to start rehiring people and start growing production because if you wait until the inventory gets into that band, then we'll have to create the full output of a quarter fresh without being able to take it from the inventory would be a growth unachievable because that's a hill to climb.

我們預計 6 月季度庫存將在 215 至 225 天之間。如果我對 9 月的情況進行預測，我認為它會降至 200 以下。我不知道確切的數字是多少。我們的目標是長期維持 130 至 150 天。因此，在 150 到 200 之間的某個數字，我們需要開始重新僱用員工並開始增加產量，因為如果等到庫存進入這個範圍，那麼我們就必須在沒有從庫存中提取的情況下創造四分之一的新鮮產量，這將是一個無法實現的增長，因為這是一座難以攀登的高山。

So we understand that how much we can grow per quarter. And based on that model, we think we will start growing the production well before it hits 150 days.

因此我們知道每個季度可以成長多少。基於該模型，我們認為我們將在達到 150 天之前開始增加產量。

Quinn Bolton, Needham & Co.

奎因·博爾頓，尼德漢姆公司

Just a quick follow-up on that last question. As you guys start to -- you get below the 200 days, somewhere between 200, 150 you start increasing production. Is that where you could see the incremental margin that you talked about being 85% in the June quarter. Is that where it could start to tick even higher? Or is there a scenario where you could see better than 85% incremental margins before that point, maybe just because of the reduction in inventory reserves.

我只是想快速回答最後一個問題。當你們開始——你們將生產時間控制在 200 天以下時，在 200 到 150 天之間的某個時間，你們就會開始增加產量。您是否看到您所說的 6 月份季度增量利潤率為 85%？那是它開始走高的地方嗎？或者是否存在這樣一種情況，即在此之前，您可能會看到超過 85% 的增量利潤率，這可能只是因為庫存儲備的減少。

There are a lot of moving parts. There are a lot of moving parts. There is -- as the inventory comes down, your write-offs go away because even the slow-moving parts are no longer higher than 18 months of inventory, your utilization starts to improve and you ramp the fab, so there are a lot of moving parts. But I think we can roughly keep that sort of incremental margin falling to the bottom for a few quarters. That's sort of the best I can describe.

有很多活動部件。有很多活動部件。有的——隨著庫存下降，您的註銷就會消失，因為即使是滯銷部件也不再高於 18 個月的庫存，您的利用率開始提高，並且您增加了晶圓廠的產能，因此有很多活動部件。但我認為我們可以大致保持這種增量利潤率在幾個季度內降至最低。這大概是我能描述的最好的了。

Chris Daneley, Citibank.

花旗銀行的克里斯丹利 (Chris Daneley)。

Thanks, guys. Steve or Eric, just a question on the inventory write-downs, write-offs, et cetera, et cetera. How much of that has been written off written down? And then when will you start to sell that? And what's the impact going to be on the P&L for planning purposes.

謝謝大家。史蒂夫或艾瑞克，我只想問一下關於庫存減記、註銷等等的問題。其中有多少已被註銷？那你什麼時候開始銷售它？這對於規劃目的的損益表有何影響？

Well, it's a bit unpredictable on when we will see it, right? If we had an order on the backlog today, we wouldn't have written it off this last quarter. So it's just based on the pattern of orders that come in, we know that we are building very long-life products that are going to sell over time. It's just that predicting that is difficult. But every quarter, we have sell-through of previously written off inventory and because we've written off so much over the last 5 or 6 quarters, that tailwind to gross margin is going to come.

嗯，我們什麼時候能看到它有點難以預測，對吧？如果我們今天有積壓訂單，我們就不會在上個季度將其註銷。因此，僅根據收到的訂單模式，我們就知道我們正在生產壽命非常長的產品，這些產品將會隨著時間的推移而暢銷。只是預測起來比較困難。但每個季度，我們都會售出先前註銷的庫存，而且由於我們在過去 5 或 6 個季度中註銷了大量庫存，因此毛利率將會出現順風。

We don't necessarily think that's happening this quarter. But I think as we progress through fiscal '26, we're going to start to see benefits of that.

我們認為本季不一定會發生這種情況。但我認為，隨著 26 財年的進展，我們將開始看到其好處。

Okay. And then as a follow-up, so either Steve or Rich, Steve, now that you've been there for several months would you -- I guess, what would be your take on just Microchip's product positioning in the microcontroller market, maybe how it's gone over the last year or so. And -- do you think that anything needs to change? Do you guys think you need to add on anything to the product lines or do anything differently? Or is it sort of autopilot right now?

好的。然後作為後續問題，史蒂夫或里奇，史蒂夫，既然你已經在那裡待了幾個月，你對微晶片在微控制器市場上的產品定位有何看法，也許可以談談過去一年左右的發展。而且—您認為有什麼需要改變嗎？你們認為需要在產品線中添加什麼內容或做一些不同的事情嗎？或者現在它是某種自動駕駛儀？

I just appreciate your thoughts on the market share and the product positioning.

我只是很欣賞您對市場佔有率和產品定位的看法。

Well, I mean, there's certainly nothing out of pilot. There is an extreme sense of urgency, Rich and I have brought back to the group. And we've made a number of organization changes, 8-bit combining with 32-bit is the most visible to you, but we made other changes across the company and there is a new sense of vigor and a new sense of urgency. And you're starting to see essentially, when I look across the company, every indicator is starting to move in the right direction. Revenue growth, gross margin growth, operating margin growth, EPS growth, inventory reduction, product schedules, pricing, everything else is really just lining up and.

嗯，我的意思是，試點肯定沒有什麼進展。我和里奇為團隊帶來了極度的緊迫感。我們已經進行了一些組織變革，8 位與 32 位的結合是最明顯的，但我們在整個公司範圍內也進行了其他變革，並且帶來了一種新的活力感和緊迫感。當我放眼整個公司時，你會發現，每個指標都開始朝著正確的方向發展。收入成長、毛利率成長、營業利潤率成長、每股盈餘成長、庫存減少、產品計畫、定價，其他一切其實只是排隊而已。

Customer accounts

客戶帳戶

So all those things are happening. So it's nothing business as usual. But I think when it gets to specific products, you can't have a CEO admit on a conference call to all the competitors that his products are I No, our products are great. But where we missed the board was in some of the 8-bit to 32-bit transition at the low end, And I did admit that. I highlighted that, and we are correcting it.

所以所有這些事情都在發生。所以這和平常沒什麼兩樣。但我認為，當涉及到具體產品時，你不能讓執行長在電話會議上向所有競爭對手承認他的產品是「我不，我們的產品很棒」。但是我們忽略了主機板在低端從 8 位到 32 位的轉換，我承認這一點。我強調了這一點，我們正在糾正它。

But no, beyond that, I think products are good.

但除此之外，我認為產品還是不錯的。

Yes. It's more of this conversion to even in development tools, we're going to make it much easier for customers to move between our product lines. A great deal of automation is being given to our customers to help them design in our products. So we are moving very aggressively on a number of fronts here. Very aggressively.

是的。甚至在開發工具方面，這種轉變也更加明顯，我們將使客戶能夠更輕鬆地在我們的產品線之間移動。我們為客戶提供了大量的自動化功能，以幫助他們設計我們的產品。因此，我們正在多個方面採取非常積極的行動。非常具有攻擊性。

So one other thing I would highlight is really kind of on the development tools. So the past strategy was that Microchip has its own unique development platform on 32-bit microcontroller that was harmony and customers have to adopt that development platform to design with our products. Now that was required when our products were with either the proprietary architecture, which the third parties didn't support or when -- where originally, we were trying to do MIPS-based products which were not supported by the third-party ecosystem. Since we now are doing most of our 32-bit products on ARM-based architecture, most large customers are using either [ Kyle or IAR ] or many a number of these development platforms, which are pretty standard. So Microchip was pushing its own platform to the people who already had a platform this providing a sort of resistance path for adopting our products.

我要強調的另一件事是關於開發工具。因此，過去的策略是，Microchip 在 32 位元微控制器上擁有自己獨特的開發平台，客戶必須採用該開發平台來設計我們的產品。現在，當我們的產品採用第三方不支援的專有架構時，或者當我們最初嘗試製造第三方生態系統不支援的基於 MIPS 的產品時，就需要這樣做。由於我們現在大多數 32 位元產品都是在基於 ARM 的架構上開發的，因此大多數大客戶都在使用 [Kyle 或 IAR] 或許多此類開發平台，這些平台非常標準。因此，Microchip 正在向已經擁有平台的人推銷自己的平台，這為採用我們的產品提供了阻力路徑。

So I think what we have done very recently is change that strategy. And now we are up and running to all of these third-party platforms. So therefore, when we go into a large customer, we just have to position our products and not ask them to change their development platform. and that has really dropped on barrier, and we're succeeding getting new designs.

所以我認為我們最近所做的就是改變這個策略。現在我們已經開始運行所有這些第三方平台。因此，當我們接觸大客戶時，我們只需定位我們的產品，而不是要求他們改變他們的開發平台。這確實降低了障礙，我們成功地獲得了新的設計。

Joe Moore, Morgan Stanley.

摩根士丹利的喬摩爾。

I know the dividend has always been a big priority. Is there any scenario where you could see that coming down in different economic circumstance. I'm just asking I get the question a lot.

我知道股息一直是個重中之重。在不同的經濟環境下，您是否會看到這一數字下降？我只是問，我常被問到這個問題。

So there is an absolute commitment that dividend reduction has not been a consideration when we were threatened that our debt rating could be downgraded, we took strong action last quarter by raising this $1.45 billion mandatory convert and brought our debt level down by about $1.1 billion. With that, we reaffirmed our investment-grade rating by both rating agencies and kept the dividend intact. Now as we look at it going forward, with our revenue increasing cash getting liberated from inventory, gross margins rising. We're talking about 85% of the incremental revenue fall through I don't really think we are any situation where there is risk. So I think we have put that behind us.

因此，我們絕對承諾，當我們受到債務評級可能被下調的威脅時，我們不會考慮減少股息，上個季度我們採取了強有力的行動，提高了 14.5 億美元的強制轉換率，並將我們的債務水平降低了約 11 億美元。因此，我們重申兩家評級機構對我們的投資等級評級，並維持股利不變。現在我們展望未來，隨著我們的收入增加，現金從庫存中解放出來，毛利率也會上升。我們談論的是 85% 的增量收入下降，我真的不認為我們處於任何有風險的情況。所以我認為我們已經把這件事拋在腦後了。

Okay. I appreciate that. And then I've also gotten questions on the non-GAAP adjustments, the preferred dividend coming out of the non-GAAP numbers? Can you just describe the rationale for that?

好的。我很感激。然後我還對非 GAAP 調整、非 GAAP 數字中的優先股股息有疑問？您能描述一下這樣做的理由嗎？

Well, it's a dividend, right? So for GAAP accounting purposes, the preferred dividend is shown on the income statement. But there are many companies that have these mandatory preferreds in place and exclude them from the non-GAAP results because it's really an equity instrument. It's not a debt instrument.

嗯，這是股息，對吧？因此，出於 GAAP 會計目的，優先股股息顯示在損益表中。但許多公司都設有這些強制性優先股，並將其排除在非公認會計準則結果之外，因為它實際上是一種股權工具。它不是債務工具。

Janet Ramkissoon, Quadra Capital.

Quadra Capital 的 Janet Ramkissoon。

Yes. Steve. Thanks. Great job and what you've been able to accomplish in such a short period of time. I wanted to drill down a little bit on the aerospace and defense I was a little bit surprised that it's up to 18%.

是的。史蒂夫。謝謝。幹得很棒，你在這麼短的時間內就取得了這樣的成就。我想深入了解航空航太和國防領域，我對這一比例高達 18% 感到有點驚訝。

And there are a lot of changes in the default area. Where we're seeing a lot of the traditional defense companies working more with some of the newer players in the market, SpaceX and [rural] industries and guys who are making drones and robots. Can you give me a sense of what your exposure is to some of these new markets? And I noticed you did say that one of the focus was to switch from 5G to AI. How does that tie into this defense business and some addressing some of the newer opportunities with some of these more innovative players in the space.

並且預設區域有很多變化。我們看到許多傳統國防公司正在與市場上的一些新參與者、SpaceX和[農村]工業以及製造無人機和機器人的公司進行更多的合作。能否介紹一下您對這些新市場的了解程度？我注意到您確實說過重點之一是從 5G 轉向 AI。這與國防業務有何關聯？如何與該領域一些更具創新精神的參與者一起應對一些較新的機會？

So good question on that. So when it comes to new space, we've been working with those customers for quite some time. And now there's this new generation of new defense customers coming up. And what we've been doing is taking some of our products instead of rad hard, you become rad-tolerant. We've been now introducing more plastics into our aerospace and defense product line and then working with our different product BUs to convert more products to that rad-tolerant or plastic product line that is more focused towards the new defense or new space customers.

這個問題問得好。因此，當談到新空間時，我們已經與這些客戶合作了很長一段時間。現在，新一代國防客戶正在湧現。我們一直在做的是，讓我們的一些產品不再受到輻射的傷害，而是變得具有抗輻射能力。我們現在已經將更多的塑膠引入我們的航空航太和國防產品線，然後與我們不同的產品部門合作，將更多的產品轉換為更側重於新國防或新太空客戶的耐輻射或塑膠產品線。

Could you give me a sense of how you characterize the opportunity for you? How large is it? Is this just a small thing? Or could this be inversion to a good growth area for you.

您能否告訴我您如何描述這個機會？它有多大？這不就是一件小事嗎？或者這對您來說可能是一個向良好成長領域的轉變。

So I think, Janet, all these new things is an opportunity, and we're engaged with everyone. But I think where the real growth is going to come from is two factors: Number one, US defense is talking about rebuilding its arsenal. They are depleted on missiles and bullets and rifles and tanks and plans and everything is aging, fleet is all. So they're going to be a substantial rebuilding of our defense arsenal, and we are in everything.

所以我認為，珍妮特，所有這些新事物都是一個機會，我們與每個人都接觸了。但我認為真正的成長將來自兩個因素：第一，美國國防部正在討論重建其軍火庫。他們的飛彈、子彈、步槍、坦克和計劃都耗盡，一切都在老化，艦隊就是一切。因此，他們將對我們的國防武器庫進行大規模重建，我們將參與其中。

There's nothing in our US defense, no better tank, no plan, no missile, no nothing that Microchip is not in it. We are in everything. So I think that's where the growth comes in US Now you can add to that drones and SpaceX and all that, but those are not multibillion-dollar opportunities.

我們的美國國防中沒有任何東西，沒有更好的坦克，沒有計劃，沒有飛彈，沒有微晶片不在裡面的東西。我們存在於一切事物之中。所以我認為這就是美國的成長點，現在你可以增加無人機和 SpaceX 等等，但這些都不是價值數十億美元的機會。

And the second piece on the growth is really what's happening in NATO. NATO is going to double and triple its budget over the next two years, three years. And because they're being pushed to really invest for their defense. So they are rebuilding their arsenal, rebuilding missiles and tanks and rifles and drones and radars and all that. And we are in all that stuff.

關於成長的第二個部分實際上是北約正在發生的事情。北約計劃在未來兩三年內將預算增加一至兩倍。因為他們被迫真正投資國防。因此他們正在重建軍火庫，重建飛彈、坦克、步槍、無人機、雷達等等。我們都身處其中。

So we're already hearing from defense customers in Europe about a significant opportunity.

因此，我們已經從歐洲國防客戶那裡聽說了一個重大機會。

Just about 4 weeks ago, one of the major customers from France heard about that we were closing Fab 2, Tempe fab and he flew down to Chandler to come see me confronting me on he's planning to double his business, why am I closing fabs, then I explained to him that his products were not made in Fab two products are rare hard or whatever they made in other fabs and one or two items that may be in Fab 2,we have inventory, and we're transitioning them to other fabs. So you could kind of see that customers are looking for significant growth, and they want to ensure that Microchip is in a position to meet their needs.

大約四周前，一位來自法國的大客戶聽說我們要關閉 Fab 2，即坦佩工廠，他飛到錢德勒來找我，質問我他計劃將業務翻一番，為什麼要關閉工廠，然後我向他解釋說，他的產品不是在 Fab 2 生產的，產品是稀有硬件，或者是他們在其他工廠生產的任何產品，Fab 2 中生產的，產品是稀有硬件，或者是他們在其他工廠生產的任何產品，Fab 2 中可能正在庫存。因此你可以看出客戶正在尋求顯著的成長，他們希望確保 Microchip 能夠滿足他們的需求。

Christopher Rolland, Susquehanna International.

薩斯奎漢納國際公司的克里斯多福羅蘭 (Christopher Rolland)。

Thanks for the question. I'll try to be brief. Steve, how do you see market share dynamics in Microchip, the actual MCU market playing out do you see China taking share? Are there any more formidable competitors? And do you expect your share to increase?

謝謝你的提問。我會盡量簡短地講。史蒂夫，您如何看待微晶片的市場份額動態，實際的 MCU 市場表現如何，您認為中國會佔據市場份額嗎？還有更強大的競爭對手嗎？您預計您的份額會增加嗎？

I absolutely expect our share to increase in MCU in the coming couple of years. And so it has to be -- some of it is driven by many of our microcontroller customers that have been sitting on a significant inventory, haven't been buying the full boat of products. And just starting this quarter, we're starting to see increased bookings from them, purchasing from them. Our guidance for the June quarter is on the upper end of the industry, and I think market share gains are reflected in them.

我絕對相信未來幾年我們在 MCU 中的份額會增加。所以必須如此——部分原因是我們的許多微控制器客戶都持有大量庫存，並未購買全部產品。從本季開始，我們開始看到來自他們的預訂量和購買量增加。我們對六月季度的預期處於行業高端，我認為市場份額的成長已經反映在其中。

One other, and I apologize if this was asked, but AI as a percentage of revenue. And you had a bunch of new looks like AI product announcements, optical, power, PCI. Are you expecting any of these to be really needle-moving and of particular emphasis for you guys moving forward?

另外，如果有人問到這個問題，我很抱歉，但人工智慧佔收入的百分比。您還看到了許多新事物，例如 AI 產品公告、光纖、電源、 PCI。您是否期望其中任何一個能夠真正起到推動作用並且對您未來的發展起到特別的強調作用？

So we continue to see the percentage of sales that increasing. I think we had given a number last year, it was about 4% of sales. as of the latest measurement, it's just over 6% of sales. So we continue to see strength in that particular marketplace for us. And we continue to introduce new product lines within that area.

因此，我們繼續看到銷售百分比正在成長。我認為我們去年給了一個數字，大約佔銷售額的 4%。根據最新測量，其銷售額僅佔 6% 多一點。因此，我們繼續看到該特定市場對我們而言具有優勢。我們將繼續在該領域推出新的產品線。

In fact, one of the reorganizations that we did was we created an AIML product group to help. We've got almost eight different BUs within the company that need either models or model zoos or accelerators on their products, and that group is helping coordinate that activity within the organization.

事實上，我們所做的重組之一就是建立一個 AIML 產品組來提供協助。我們公司內部有近八個不同的業務部門，它們的產品都需要模型、模型動物園或加速器，而該部門正在幫助協調組織內部的活動。

Craig Ellis, B. Riley Securities.

克雷格·艾利斯 (Craig Ellis)，B. Riley 證券。

Yes. I wanted to go back to the point that Rich made earlier about the significant changes that Microchip had made to improve product development and product development, deficiency for customers. What I was hoping you could do is just share an example or two of what those changes are and and more importantly, help us understand when would investors see the benefit of the changes that you've made and how material could they be in, say, 2026 and years beyond?

是的。我想回到 Rich 之前提出的觀點，即 Microchip 為改善產品開發和產品開發缺陷而做出的重大改變。我希望您能分享一兩個例子來說明這些變化是什麼，更重要的是，幫助我們了解投資者何時能看到您所做的改變帶來的好處，以及這些改變在 2026 年及以後會有多大的實際意義？

That's -- what we've helped customers do is essentially speed up their development time. And so it becomes a productivity tool in terms of time to market. So we've been training an internal model for almost two years in terms of writing code for our products. We've decided to provide that tool that we've been using internally with over 1,000 engineers for their own productivity, free of charge. And so we've essentially handed our customers an internally trained tool that we found is 40% plus percent productivity improvement to help their own embedded control designers.

這就是－我們幫助客戶做的本質上就是加快他們的開發時間。因此，它成為了一種提高上市時間的生產力工具。因此，我們在為我們的產品編寫程式碼方面已經訓練了一個內部模型近兩年了。我們決定免費提供這個我們內部使用的工具，供 1,000 多名工程師使用，以提高他們的工作效率。因此，我們基本上向客戶交付了一款內部訓練的工具，我們發現該工具可將生產效率提高 40% 以上，從而幫助他們自己的嵌入式控制設計師。

And we continue to -- any enhancement that we make internally for our internal designers. We are now passing that on to our customers as well. And so we've gotten great feedback from customers that have started using it in terms of productivity improvements. In terms of relating that to revenue, that is difficult to say at this point. Our goal is to make our customers' life easier and to make the transition to Microchip development environment are using Microchip as a whole, easier, right?

並且我們將繼續為我們的內部設計師進行任何內部改進。我們現在也將這個理念傳遞給我們的客戶。因此，我們從已經開始使用它的客戶那裡得到了關於生產力提高的良好回饋。至於這與收入之間的關係，目前還很難說。我們的目標是讓客戶的生活更加輕鬆，並使向 Microchip 開發環境的過渡以及使用 Microchip 整體變得更加輕鬆，對嗎？

And also making customers tend to choose Microchip over someone else because of the ease of designing in a Microchip product. That's the goal.

而且由於 Microchip 產品設計簡便，客戶也傾向於選擇 Microchip 而不是其他公司。這就是目標。

And is there anything about those tools, Rich, that would help them -- if they're going to use Microchip in one product on a system board more easily designing Microchip products for other parts of that system board so that the total system solution ambition that Microchip has had is something that's facilitated with the capability you've developed.

那麼，Rich，這些工具有什麼作用呢？如果他們要在系統板上的某個產品中使用 Microchip，那麼這些工具是否能夠幫助他們更輕鬆地為該系統板的其他部分設計 Microchip 產品，以便 Microchip 實現其總體系統解決方案的宏偉目標，而您開發的功能則能夠幫助他們實現這一目標。

Yes. So we have work going on. So we actually have AI product recommenders that actually do that now for customers. We've started unleashing that to them. But later in the year, we will actually be offering Board-related support for TSS type solutions.

是的。所以我們的工 作還在繼續。因此，我們實際上有 AI 產品推薦器，可以為客戶做到這一點。我們已經開始向他們公開這一點。但今年晚些時候，我們實際上將為 TSS 類型的解決方案提供與董事會相關的支援。

And so you can see where we're going now you've got product recommenders, now you've got software development tools. Now you can start to combine product recommended with software development tools and you could start recommending block diagrams and putting that all together.

所以你可以看到我們現在要去哪裡，你有產品推薦器，現在你有軟體開發工具。現在，您可以開始將建議的產品與軟體開發工具結合，並且可以開始推薦框圖並將它們整合在一起。

Thank you. There are no further questions at this time. And now I'd like to hand over to Mr. Sanghi for closing remarks.

謝謝。目前沒有其他問題。現在我想把發言時間交給桑吉先生作結束語。

Well, thanks, everyone, for joining us. As you can see from our report that we turned the corner and we're looking for a significant improvement in our financial performance in this fiscal year. And I will see many of you on the road as we go to the conferences this quarter. Thank you.

好吧，謝謝大家加入我們。從我們的報告中您可以看到，我們已經走出了困境，並期待本財年的財務表現有顯著改善。本季度我們參加會議時，我會在路上看到你們中的許多人。謝謝。

Thank you very much. Ladies and gentlemen, that does conclude today's teleconference. Thank you very much for joining us. You may now disconnect your lines.

非常感謝。女士們、先生們，今天的電話會議到此結束。非常感謝您加入我們。現在您可以斷開線路了。