MACOM Technology Solutions Holdings, Inc. (MTSI) 2020 Q2 法說會逐字稿

Good afternoon, and welcome to MACOM's Second Fiscal Quarter 2020 Conference Call. This conference call is being recorded today, Wednesday, April 29, 2020. (Operator Instructions)

各位下午好，歡迎參加 MACOM 2020 會計年度第二季財報電話會議。本次電話會議於今天（2020 年 4 月 29 日，星期三）錄音。（接線員指示）

I will now turn the call to Mr. Steve Ferranti, MACOM's Vice President of Investor Relations. Mr. Ferranti, please go ahead.

現在我將把電話交給 MACOM 投資人關係副總裁 Steve Ferranti 先生。Ferranti 先生，請開始。

Thank you, operator. Good afternoon, and welcome to MACOM's Second Fiscal Quarter 2020 Earnings Conference Call. I would like to remind everyone that our discussion today will contain forward-looking statements, which are subject to certain risks and uncertainties as defined in the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those discussed today. For more detailed discussions of the risks and uncertainties that could result in those differences, we refer you to MACOM's filings with the SEC. Management's statements during this call will include discussions of certain adjusted non-GAAP financial information. A reconciliation of GAAP to adjusted non-GAAP results are provided in the company's press release and related Form 8-K, which was filed with the SEC today. And with that, I'll turn over the call to Steve Daly, President and CEO of MACOM.

謝謝，接線員。各位下午好，歡迎參加 MACOM 2020 會計年度第二季財報電話會議。我想提醒各位，我們今天的討論將包含前瞻性陳述，該等陳述受 1995 年《私人證券訴訟改革法案》中所載之前瞻性陳述安全港條款所界定之特定風險與不確定性影響。實際結果可能與今日討論內容存在重大差異。關於可能導致該等差異之風險與不確定性的更詳細討論，請參閱 MACOM 向美國證券交易委員會（SEC）提交的文件。管理層在本次電話會議中的發言將包含對若干經調整之非 GAAP 財務資訊的討論。GAAP 與經調整非 GAAP 結果之調節表已載於公司新聞稿及相關的 Form 8-K（已於今日向 SEC 提交）中。接下來，我將把電話交給 MACOM 總裁兼執行長 Steve Daly。

Thank you, and good afternoon. I will begin today's call with a general company update. After that, Jack Kober, our Chief Financial Officer, will provide a more in-depth review of our fiscal 2020 Q2 financial results. When Jack is finished, I will provide revenue and earnings guidance for Q3, and then we would be happy to take some questions.

謝謝，各位下午好。我將先就公司整體情況做一般性更新。之後，我們的財務長 Jack Kober 將更深入地回顧 2020 會計年度第二季的財務結果。Jack 結束後，我將提供第三季的營收與獲利指引，接著我們很樂意回答一些問題。

Revenue for Q2 was $126.4 million and adjusted EPS was $0.17 per diluted share. Our Q2 results show positive trends in our performance, and our employees should be proud of these results. We continue to focus on a list of internal initiatives to enhance the overall efficiency of the business. Notably, during Q2, we made progress in our inventory management processes. And the net result was an improvement in inventory turns and a reduction in total inventory levels. While we still have a significant amount of work ahead of us, the operations team is doing an excellent job with this and other continuous improvement projects. Before moving to the details of our Q2 results, I would like to provide an overview of the impact of the COVID-19 pandemic on our business. As you know, MACOM is a global company, and we have employees across Asia, Europe and North America. Since beginning of this pandemic, our top priorities have been to maintain the health, safety and well-being of our employees, keeping our business operational and delivering on commitments to our customers. Among other things, MACOM manufactures certain essential products for U.S. defense and telecommunications infrastructure applications. Accordingly, our U.S.-based manufacturing facilities have remained operational. In addition to following local regulations and guidance, in order to maintain a safe work environment, we practice social distancing protocols, provide enhanced employee screening, restrict on-site visitors and nonessential staff, and conduct enhanced facility cleaning and disinfecting procedures regularly. We've also implemented a work-from-home posture for our employees in nonmanufacturing functions, including customer service, engineering and administration. At the same time, our global sales force has remained actively engaged with customers using video and teleconferencing.

第二季營收為 1.264 億美元，經調整後每股盈餘（EPS）為每股稀釋後 0.17 美元。我們第二季的結果顯示公司表現呈現正向趨勢，員工應以此成果為榮。我們持續聚焦於一系列內部倡議，以提升整體營運效率。值得一提的是，在第二季我們在存貨管理流程方面取得進展，其淨結果為存貨周轉率提升並降低總存貨水位。雖然我們仍有大量工作要做，但營運團隊在此及其他持續改善專案上表現非常出色。在進入第二季結果細節之前，我想先概述 COVID-19 疫情對我們業務的影響。如各位所知，MACOM 是一家全球性公司，員工遍布亞洲、歐洲與北美。自疫情開始以來，我們的首要任務是維護員工的健康、安全與福祉，維持公司營運並履行對客戶的承諾。除其他事項外，MACOM 為美國國防與電信基礎設施應用製造若干關鍵產品。因此，我們位於美國的製造設施一直維持運作。除遵循當地法規與指引外，為維持安全的工作環境，我們實施社交距離規範、加強員工篩檢、限制現場訪客與非必要人員，並定期加強廠區清潔與消毒程序。我們也已對非製造職能（包括客服、工程與行政）的員工實施居家辦公。同時，我們的全球銷售團隊仍透過視訊與電話會議積極與客戶互動。

Our operations team has been working with our global suppliers to mitigate the impact of COVID-19 related interruptions to our business. During the quarter, we experienced both supplier closures and partial shutdowns specifically from certain Asia-based suppliers, including assembly and test subcontractors in Malaysia. We have managed these issues effectively, and we do not believe these interruptions have had a material impact on our business to date. However, the situation is dynamic and it requires daily management by our operations team to support our customers. But simply put, our dedicated employees have rallied to keep our business and operations up and running in an effort to service our customers and meet our commitments.

我們的營運團隊一直與全球供應商合作，以降低 COVID-19 相關中斷對業務的影響。本季期間，我們確實遭遇供應商停工與部分停產，特別是來自部分亞洲供應商的影響，包括位於馬來西亞的組裝與測試分包商。我們已有效管理這些問題，且我們認為截至目前這些中斷尚未對我們的業務造成重大影響。然而，情勢仍在變化，需要營運團隊每日管理以支援客戶。簡而言之，我們敬業的員工齊心協力，確保公司業務與營運持續運轉，以服務客戶並履行承諾。

Our Q2 revenue by end market was as follows: Data Center was $26.7 million. Telecom was $51.6 million, and Industrial & Defense was $48.1 million. Data Center and Telecom had sequential growth rates of 16% and 13%, respectively. Industrial & Defense was down 5% sequentially. On a geographic basis, 45% of second quarter revenue was from domestic customers and 55% from international customers, similar to prior quarters. Our book-to-bill ratio was approximately 1.25:1, and our turns business, or business booked and shipped within the quarter, was approximately 22% of total revenue. Generally speaking, demand for our products was strong in the second quarter. We experienced strong bookings across all 3 of our end markets, and we are pleased with the growth of our backlog. I'll highlight that we have very little consumer electronics or automotive business exposure. We are staying in close contact with our largest customers in closely monitoring channel inventory, general order activity and long-term demand forecasts. We believe the strong Q2 bookings is due to a combination of improved Data Center and Telecom end market demand, market share gains, and to a lesser degree, from customers ordering ahead of end demand due to fear of future component shortages caused by COVID-19 supply chain disruptions.

第二季按終端市場劃分的營收如下：資料中心為 2,670 萬美元；電信為 5,160 萬美元；工業與國防為 4,810 萬美元。資料中心與電信的季增率分別為 16% 與 13%。工業與國防則季減 5%。按地理區域來看，第二季營收中 45% 來自國內客戶、55% 來自國際客戶，與前幾季相近。我們的接單出貨比（book-to-bill）約為 1.25:1，而我們的 turns 業務（即在本季內接單並出貨的業務）約占總營收的 22%。整體而言，第二季對我們產品的需求強勁。我們在三大終端市場皆取得強勁接單，且對在手訂單（backlog）的成長感到滿意。我也要強調，我們幾乎沒有消費性電子或汽車業務曝險。我們與最大客戶保持密切聯繫，持續監控通路庫存、整體訂單活動與長期需求預測。我們認為第二季強勁接單係由多項因素共同促成，包括資料中心與電信終端市場需求改善、市占率提升，以及在較小程度上，客戶因擔憂 COVID-19 供應鏈中斷可能導致未來零組件短缺而提前下單。

For Q2, sequential growth in our Data Center end market revenue was driven by cloud data center demands. Our 100G high-performance analog products and our emerging 200G and 400G analog product lines support this market segment. We view ongoing demand for data bandwidth and associated infrastructure upgrades inside the data center to be a strong growth driver for MACOM in the years ahead, and we see the emergence of 200G and 400G to be opportunities to expand our position in the market. Sequential growth in our Telecom end market revenue was primarily driven by demand for 5G products as well as from new products such as our 64-gigabaud Metro/Long-haul product lines. As a reminder, we have a broad portfolio of 5G products today consisting of receive side RF front-end modules, control products for base stations, high-performance analog ICs for 5G fronthaul and high-performance coherent driver and TIA products for mid-haul.

第二季資料中心終端市場營收的季增，主要由雲端資料中心需求所帶動。我們的 100G 高效能類比產品，以及新興的 200G 與 400G 類比產品線，皆支援此市場區隔。我們認為，資料頻寬的持續需求以及資料中心內部相關基礎設施升級，將在未來數年成為推動 MACOM 成長的強勁動能；同時，我們也將 200G 與 400G 的興起視為擴大市場地位的機會。第二季電信終端市場營收的季增，主要由 5G 產品需求所驅動，亦受惠於新產品（例如我們的 64-gigabaud 都會/長途（Metro/Long-haul）產品線）。提醒各位，我們目前擁有廣泛的 5G 產品組合，包括接收端 RF 前端模組、基地台控制產品、用於 5G 前傳（fronthaul）的高效能類比 IC，以及用於中傳（mid-haul）的高效能相干驅動器與 TIA 產品。

We view 5G infrastructure deployments as a key growth driver for MACOM revenue in the years ahead. And in the coming quarters, we anticipate expanding our current 5G portfolio by launching complementary new products, including additional optical components, more discrete RF components and more high-performance analog and mixed-signal ICs. Our Industrial & Defense end market revenue continues to be driven by long-term U.S. defense programs, particularly in electronic warfare applications, along with satellite communication applications and increased sales to test and measurement customers. Ultimately, we believe that revenue growth in our 3 end markets will be driven by our ability to design and bring new products to market quickly and win market share. We are confident that the changes made in our engineering management and broader organization last year as well as the updates to our product development process will enable us to improve MACOM's competitiveness and time to market. Before discussing our notable new product releases for the second quarter, I would like to highlight that in lieu of attending OFC, we hosted virtual product demonstrations. In total, we hosted over 30 demonstrations and interactive private video meetings with customers. We've had 3 engineering test events showcasing MACOM products in real-world optical applications. We believe these demonstrations were well received and served to further educate our customers, and we expect these efforts will ultimately lead to new design wins.

我們認為 5G 基礎設施部署將在未來數年成為推動 MACOM 營收成長的關鍵動能。在接下來幾季，我們預期將透過推出互補性新產品來擴充現有 5G 產品組合，包括更多光學元件、更多分立式 RF 元件，以及更多高效能類比與混合訊號 IC。我們的工業與國防終端市場營收，持續由美國長期國防計畫所帶動，尤其是電子戰應用，同時也包括衛星通訊應用，以及對測試與量測客戶的銷售增加。最終，我們相信三大終端市場的營收成長將取決於我們快速設計並將新產品推向市場、以及贏得市占率的能力。我們有信心，去年在工程管理與更廣泛組織所做的變革，以及對產品開發流程的更新，將使我們能提升 MACOM 的競爭力並縮短上市時間。在討論第二季值得關注的新產品發表之前，我想強調，因未能參加 OFC，我們改以線上方式舉辦虛擬產品展示。總計我們舉辦了超過 30 場展示與與客戶的一對一互動式私人視訊會議。我們也舉辦了 3 場工程測試活動，在真實世界的光學應用中展示 MACOM 產品。我們相信這些展示獲得良好回響，並有助於進一步教育客戶；我們預期這些努力最終將帶來新的設計導入（design wins）。

We had 3 demos. First, we showed a complete chipset for 50G PAM4 transmit and receive links with Ethernet security for 5G mid-haul deployments over 10 kilometers. This chipset featured a total of 5 MACOM ICs, including our PRISM-50 DSP, silicon photonics IC, a 26-gigabyte TIA, high-speed photodetector and a MACSec Phy SoC.

我們進行了 3 場展示。首先，我們展示了一套完整的晶片組，用於 50G PAM4 發射與接收鏈路，並具備乙太網路安全功能，適用於 5G 中傳（mid-haul）在 10 公里距離的部署。該晶片組共包含 5 顆 MACOM IC，包括我們的 PRISM-50 DSP、矽光子 IC、一顆 26 gigabaud 的 TIA、高速光偵測器，以及一顆 MACSec Phy SoC。

Second, we showed a high-speed analog chipset to support 200G modules for use inside the data center, that is compliant with the Open Eye MSA standard. Our demo included customers 200G and 400G QSFP modules and active optical cables built upon the MACOM chipset. These analog modules were plugged into commercial Ethernet switches running live traffic and we're successfully working with other DSP-based optical modules. And third, we showcased 100G single-lambda DR/FR PAM4 link over 2 kilometers of fiber, leveraging MACOM's latest PRISM DSP, 56-gigabaud TIA and high-speed photodiode. This setup is ideal for point-to-point or 4 x 100G breakout applications inside the data center. Our Lightwave engineering teams released a number of new products during the second quarter, including a 25G Avalanche Photodiode or APD.

第二，我們展示了一套高速類比晶片組，用於支援資料中心內部使用的 200G 模組，並符合 Open Eye MSA 標準。我們的展示包含客戶的 200G 與 400G QSFP 模組，以及基於 MACOM 晶片組打造的主動式光纜（AOC）。這些類比模組插入商用乙太網路交換器並承載即時流量運行，且已成功與其他基於 DSP 的光模組協同工作。第三，我們展示了 100G 單波長（single-lambda）DR/FR PAM4 鏈路，透過 2 公里光纖傳輸，並採用 MACOM 最新的 PRISM DSP、56 gigabaud TIA 與高速光二極體。此配置非常適合資料中心內的點對點或 4 x 100G 分拆（breakout）應用。我們的 Lightwave 工程團隊在第二季發布了多項新產品，包括一款 25G 雪崩光電二極體（Avalanche Photodiode，APD）。

APDs are key optical components in 5G wireless and data center applications. Our 25G APD is capable of operating between 1,250 and 1,650 nanometers and features very high sensitivity of minus 22 dBm when coupled to a low noise amplifier.

APD 是 5G 無線與資料中心應用中的關鍵光學元件。我們的 25G APD 可在 1,250 至 1,650 奈米之間運作，並在搭配低雜訊放大器時具備極高靈敏度，可達 -22 dBm。

MACOM will offer the 25G APD as a bare die and in chip-on-carrier formats to provide maximum design flexibility to our customers. As a reminder, our Lightwave engineering team designs best-in-class APD devices as well as a portfolio of over 15 unique laser configurations. Our laser technology is targeting applications in the Data Center, Telecom infrastructure as well as Industrial & Defense markets. We approach customers with a strong knowledge and experience in high-speed data transmission, optical transmission, lightwave detection and communication systems with a goal to win semiconductor component business. We seek applications in all markets where customers transmit and receive high-speed digital signals using optical technology.

MACOM 將以裸晶（bare die）以及載板上晶片（chip-on-carrier）形式提供 25G APD，以為客戶提供最大的設計彈性。提醒一下，我們的 Lightwave 工程團隊設計同級最佳的 APD 元件，並擁有超過 15 種獨特雷射配置的產品組合。我們的雷射技術鎖定資料中心、電信基礎設施，以及工業與國防市場的應用。我們以在高速資料傳輸、光傳輸、光波偵測與通訊系統方面的深厚知識與經驗接觸客戶，目標是贏得半導體元件業務。我們尋求在所有市場中的應用機會，凡是客戶使用光學技術來發送與接收高速數位訊號的領域，皆是我們關注的方向。

During Q2, our high-performance analog team extended our transimpedance amplifier or TIA portfolio with 2 new TIAs optimized for use in applications ranging from 100G DR1 to 800G DR8 and FR8. The first new TIA supports high throughput optical data links in a very low-power profile optimal for use in high-density optical data center interconnects. The device is intended for 50G to 400G receivers using PAM4 modulation. The second new TIA is a quad 26/53 gigabaud linear PAM4 TIA with automatic gain and integrated AGC loop. The TIA consumes very low power and is primarily targeted for single-mode fiber applications. These new TIAs are available to customers in flip chip and wire bonding packages options for flexible deployment.

在第二季，我們的高效能類比團隊以 2 款新 TIA（跨阻放大器）擴充了產品組合，這兩款產品針對從 100G DR1 到 800G DR8 與 FR8 的應用進行最佳化。第一款新 TIA 以極低功耗特性支援高吞吐量光資料鏈路，最適合用於高密度的資料中心光互連。該元件面向採用 PAM4 調變的 50G 至 400G 接收端。第二款新 TIA 為四通道 26/53 gigabaud 線性 PAM4 TIA，具備自動增益與整合式 AGC 迴路。該 TIA 功耗非常低，主要鎖定單模光纖應用。這些新 TIA 以倒裝晶片（flip chip）與打線（wire bonding）封裝選項提供給客戶，以利彈性部署。

Our RF and microwave engineering teams continue to expand their product lines with the goal of gaining further market share in our core Industrial & Defense markets. We are focused on executing our product plans more efficiently, while also challenging our designers and technologists to raise the level of innovation with more best-in-class products. We believe that our MMIC and diode product lines are getting stronger, and we will continue to expand with differentiated performance. The products I've just highlighted and our other recently introduced products provide us the opportunity to gain market share and drive revenue and profit growth in the near to midterm. At the same time, we continue to work on long-term R&D, which will support our next-generation products in MACOM's long-term growth.

我們的 RF 與微波工程團隊持續擴展產品線，目標是在核心的工業與國防市場取得更多市占。我們專注於更有效率地執行產品計畫，同時也要求設計師與技術人員提升創新水準，推出更多同級最佳產品。我們相信，我們的 MMIC 與二極體產品線正變得更強，我們也將持續以差異化效能擴張。剛才我重點介紹的產品以及其他近期推出的產品，為我們帶來在短期至中期提升市占、推動營收與獲利成長的機會。同時，我們也持續投入長期研發，這將支撐我們的下一代產品，並促進 MACOM 的長期成長。

Given the uncertainty in the markets, I would like to highlight to investors that MACOM is a strong company that has a deep and diverse technology portfolio, and we service 3 very large end markets. We have thousands of customers and dozens of product lines. Some of our product lines have extraordinarily long life cycles and they produce revenue years after they've been introduced. Our R&D team continues to complement this strong foundation with new products and technologies, some of which I've discussed today. We are fortunate to have limited customer concentration, limited to no consumer electronics and automotive business exposure and limited product revenue concentration. We believe that these business attributes, along with our improved execution and financial performance will support new successes and new market share gains. We maintain a long-term view on our business. And while COVID-19 may disrupt or impact us in the coming months or quarters, we believe it will not change our fundamental long-term growth opportunity as our business is small relative to the large end markets we serve. That said, we are planning for both best and worst-case scenarios given the risks and uncertainty associated with the COVID-19 pandemic. Jack will now provide a more detailed review of our Q2 financial results.

鑑於市場的不確定性，我想向投資人強調，MACOM 是一家實力堅強的公司，擁有深厚且多元的技術產品組合，並服務 3 個非常龐大的終端市場。我們擁有數千家客戶與數十條產品線。其中部分產品線具有極長的生命週期，產品推出多年後仍能持續帶來營收。我們的研發團隊也持續以新產品與新技術補強這個堅實基礎，其中部分我今天已經談到。我們很幸運地具備有限的客戶集中度、幾乎沒有消費性電子與汽車業務曝險，以及有限的產品營收集中度。我們相信，這些業務特性，加上我們改善的執行力與財務表現，將支持新的成功與新的市占提升。我們對業務維持長期觀點。雖然 COVID-19 可能在未來數月或數季對我們造成干擾或影響，但我們相信，因為相對於我們所服務的龐大終端市場而言，我們的業務規模仍小，因此疫情不會改變我們根本性的長期成長機會。儘管如此，鑑於 COVID-19 疫情帶來的風險與不確定性，我們正同時針對最佳與最差情境進行規劃。接下來 Jack 將更詳細回顧我們第二季的財務結果。

Thanks, Steve, and good afternoon, everyone. Our fiscal Q2 results demonstrate the continued improvement in the overall profitability and cash flow of the company. We posted sequential improvements in revenue, margins and adjusted earnings per share. We also reported another quarter of positive cash flow, exiting Q2 with our highest combined cash and short-term investment balances since the third fiscal quarter of 2017.

謝謝你，Steve，各位下午好。我們的會計年度第二季結果顯示，公司整體獲利能力與現金流持續改善。我們在營收、毛利率與調整後每股盈餘方面皆呈現季比改善。我們也再度繳出一季正向現金流，並在第二季結束時，合併現金與短期投資餘額達到自 2017 會計年度第三季以來的最高水準。

I would like to thank all MACOM employees for their dedication, not only in keeping our business operations functioning during this COVID-19 pandemic, but also supporting the growth in orders and revenue as well as helping to manage our spending.

我想感謝所有 MACOM 員工的投入與奉獻，不僅在這次 COVID-19 疫情期間維持我們的營運正常運作，也支持訂單與營收的成長，並協助管理我們的支出。

Revenue in the second fiscal quarter of 2020 was $126.4 million, up 6% sequentially. The sequential improvement was driven by positive trends in our Telecom and Data Center markets, including growth from early 5G deployments and strong demand in Data Center upgrades. Overall, Industrial & Defense demand remains healthy despite our anticipated modest sequential revenue decline. On a year-over-year basis, revenue was down 2% from $128.5 million in the second fiscal quarter of 2019. Adjusted gross profit in Q2 was $68.9 million or 54.5% of revenue. Adjusted gross margin was up 100 basis points sequentially. As we've discussed in the past, gross margin improvement remains a corporate priority for us. The team has done an excellent job of maintaining focus on our internal margin improvement initiatives in spite of the COVID-19 pandemic-related operational challenges we faced during Q2.

2020 會計年度第二季營收為 1.264 億美元，季增 6%。這項季比改善主要由電信與資料中心市場的正向趨勢所帶動，包括早期 5G 部署帶來的成長，以及資料中心升級的強勁需求。整體而言，儘管我們預期營收將小幅季比下滑，工業與國防需求仍維持健康。以年比來看，營收較 2019 會計年度第二季的 1.285 億美元下滑 2%。第二季調整後毛利為 6,890 萬美元，占營收比重 54.5%。調整後毛利率季增 100 個基點。正如我們過去所討論的，提升毛利率仍是公司的優先事項。儘管第二季面臨 COVID-19 疫情相關的營運挑戰，團隊仍在內部毛利率改善計畫上保持高度專注，表現非常出色。

We believe these initiatives, which target cycle time improvement, scrap reduction and other operational efficiencies will continue to result in incremental gains in gross margin over the course of fiscal 2020 and beyond. Total adjusted operating expense was $49.3 million, consisting of R&D expense of $31 million and SG&A expense of $18.3 million. Operating expenses were down $1.4 million sequentially. We will continue to balance investments in new product opportunities while diligently managing our discretionary spending. Adjusted operating income in the second quarter was $19.6 million, up $13 million in fiscal Q1, translating into 15.5% adjusted operating margin. We expect the combination of improving gross profits and stable operating expenses will provide continued operating leverage throughout the remainder of the fiscal year. Depreciation expense for Q2 was $7.3 million, and adjusted EBITDA was $26.9 million. Fiscal Q2 adjusted net interest expense was approximately $6.7 million, down around $900,000 from the first fiscal quarter of 2020. The decline was primarily driven by declining interest rates on our term loan. Looking ahead to fiscal Q3, we expect to see an incremental reduction of approximately $500,000 in net interest expense, primarily from the full quarter benefit of lower interest rates. Our non-GAAP adjusted income tax rate in fiscal Q2 continued at 8% and resulted in an expense of approximately $1 million. We expect our non-GAAP adjusted income tax rate to remain at 8% for the remainder of this fiscal year.

我們相信，這些以縮短週期時間、降低報廢率及其他營運效率為目標的計畫，將在 2020 會計年度及其後持續帶來毛利率的逐步提升。調整後營業費用總額為 4,930 萬美元，其中研發費用 3,100 萬美元，SG&A 費用 1,830 萬美元。營業費用季減 140 萬美元。我們將在審慎管理可控支出的同時，持續平衡對新產品機會的投資。第二季調整後營業利益為 1,960 萬美元，較 2020 會計年度第一季增加 1,300 萬美元，對應 15.5% 的調整後營業利益率。我們預期，毛利改善與營業費用穩定的組合，將在本會計年度剩餘期間持續帶來營運槓桿。第二季折舊費用為 730 萬美元，調整後 EBITDA 為 2,690 萬美元。2020 會計年度第二季調整後淨利息費用約為 670 萬美元，較 2020 會計年度第一季減少約 90 萬美元。下降主要由我們定期貸款利率下調所致。展望 2020 會計年度第三季，我們預期淨利息費用將再額外降低約 50 萬美元，主要來自較低利率帶來的整季效益。我們在 2020 會計年度第二季的非 GAAP 調整後所得稅率維持在 8%，對應約 100 萬美元的費用。我們預期本會計年度剩餘期間的非 GAAP 調整後所得稅率將維持在 8%。

Fiscal Q2 adjusted net income was $11.9 million compared to $4.9 million in fiscal Q1. Adjusted earnings per fully diluted share was $0.17 in fiscal Q2, utilizing a share count of 68.1 million fully diluted shares compared to $0.07 of adjusted earnings per share in fiscal Q1.

會計年度第2季調整後淨利為1,190萬美元，較會計年度第1季的490萬美元增加。會計年度第2季每股完全稀釋後調整後盈餘為0.17美元，採用6,810萬股完全稀釋後股數計算，相較於會計年度第1季每股調整後盈餘0.07美元。

Now moving on to cash flow and balance sheet items. Cash flow from operations came in at $25.3 million. Improvements in operating income and inventory management helped to enable strong cash generation for the quarter. CapEx totaled $4.8 million or 4% of revenue. Despite the lower capital spending, we continue to invest in priority programs. We continue to remain focused on achieving appropriate returns on capital that we deploy, and we expect overall capital expenditures in fiscal 2020 to be well below our fiscal 2019 levels. Free cash flow was $20.5 million for the second fiscal quarter and $33.4 million in Q1. These fiscal 2020 improvements in cash flow are a result of revenue linearity improved operating income, reduced CapEx and other working capital improvements. We believe the numerous structural changes we have made throughout the organization will continue to drive positive cash flow as we progress through the second half of the fiscal year.

接下來談現金流量與資產負債表項目。營運活動現金流量為2,530萬美元。營業利益改善與存貨管理提升，有助於本季強勁的現金創造。資本支出（CapEx）合計480萬美元，約占營收4%。儘管資本支出較低，我們仍持續投資於優先計畫。我們仍專注於確保所投入資本取得適當報酬，並預期會計年度2020年的整體資本支出將遠低於會計年度2019年的水準。會計年度第2季自由現金流為2,050萬美元，而第1季為3,340萬美元。會計年度2020年現金流的改善，來自營收線性度提升、營業利益改善、資本支出降低以及其他營運資金改善。我們相信，組織內部所進行的多項結構性變革，將在會計年度下半年持續帶動正向現金流。

Accounts receivable was $53 million, up slightly from $52 million in Q1. Days sales outstanding were 38 days, down from 42 days in Q1. Inventories were just below $100 million at quarter end, down approximately $7 million sequentially. Inventory turns improved 2.3x during the second fiscal quarter. As Steve had mentioned, inventory management remains an area of emphasis, and we see opportunities to continue to improve our inventory metrics going forward. Overall, working capital was $103 million in fiscal Q2, down approximately $2.5 million sequentially. Cash, cash equivalents and short-term investments were $221.5 million, up $11.5 million from fiscal Q1. As a reminder, our short-term investments are comprised of corporate bonds and commercial paper and are classified as held for sale.

應收帳款為5,300萬美元，較第1季的5,200萬美元略增。應收帳款週轉天數（DSO）為38天，較第1季的42天下降。季末存貨略低於1億美元，較前一季約減少700萬美元。會計年度第2季存貨週轉率提升至2.3倍。如Steve所提，存貨管理仍是重點，我們也看到未來持續改善存貨指標的機會。整體而言，會計年度第2季營運資金為1.03億美元，較前一季約下降250萬美元。現金、約當現金及短期投資為2.215億美元，較會計年度第1季增加1,150萬美元。提醒一下，我們的短期投資由公司債與商業本票組成，並分類為持有待售。

Total long-term debt was $683 million, inclusive of finance leases. Our long-term debt of $654 million is covenant-light and has minimal annual principal repayment until its maturity in May 2024. We also have an undrawn $160 million credit line available through November 2021. It's worth noting that our trailing 12-month EBITDA increased in Q2 for the first time since early fiscal 2019 nearly doubling sequentially. We believe that this trend of improving EBITDA should help to improve the leverage ratio of the company over time. As we've discussed in the past, we remain confident in our liquidity position, and believe the structural improvements we have made to increase our profitability and cash flow will provide us with sufficient financial options to execute our strategic objectives.

長期負債總額為6.83億美元，包含融資租賃。我們6.54億美元的長期負債限制性條款較少（covenant-light），且在2024年5月到期前，每年需償還的本金金額極少。我們另有一筆1.6億美元的循環信用額度尚未動用，可用至2021年11月。值得注意的是，我們過去12個月的EBITDA在第2季為自會計年度2019年初以來首次增加，且較前一季幾乎倍增。我們相信，EBITDA改善的趨勢將有助於公司槓桿比率隨時間推移而改善。如同過去所討論，我們對流動性狀況仍具信心，並相信我們為提升獲利能力與現金流所做的結構性改善，將提供我們足夠的財務選項以執行策略目標。

In summary, we feel Q2 was another quarter of solid financial performance, and we are pleased with our progress. We also understand there is still much more for us to do in order to achieve our longer-term objectives, and believe that we will continue to build positive momentum across the business. I will now turn the discussion back over to Steve.

總結而言，我們認為第2季是另一個財務表現穩健的季度，並對進展感到滿意。我們也理解，為達成較長期目標仍有許多工作要做，並相信我們將持續在整體業務上累積正向動能。接下來我把討論交回給Steve。

Thank you, Jack. MACOM expects revenue in Q3 ending July 3, 2020 to be in the range of $129 million to $133 million. Adjusted gross margin is expected to be in the range of 54% to 56%. And adjusted earnings per share is expected to be between $0.19 and $0.23 on based on 68.5 million fully diluted shares. Our Q3 revenue projections include expectations that our 3 end markets will grow sequentially. Specifically, we believe our revenue growth will be driven by the increase in Data Center traffic, 5G network deployments and increased demand for our RF and microwave products and defense applications. We are excited about the multiple growth opportunities in front of us, and we are focused on execution and planning.

謝謝你，Jack。MACOM預期截至2020年7月3日止的第3季營收將介於1.29億至1.33億美元。調整後毛利率預期介於54%至56%。以6,850萬股完全稀釋後股數計算，調整後每股盈餘預期介於0.19至0.23美元。我們對第3季營收的預測包含對三個終端市場皆將較前一季成長的預期。具體而言，我們認為營收成長將由資料中心流量增加、5G網路部署，以及對我們RF與微波產品與國防應用需求提升所帶動。我們對眼前多項成長機會感到振奮，並專注於執行與規劃。

I would now like to ask the operator to take any questions.

我現在想請接線員開始接受提問。

(Operator Instructions) Our first question comes from Harsh Kumar with Piper Sandler.

（接線員指示）我們的第一個問題來自Piper Sandler的Harsh Kumar。

First of all, huge congratulations. There aren't a whole lot of companies that are beating and then actually guiding up on a sequential basis. So a tremendous job. I had 2 quick questions. First of all, Steve, you talked about strength in the June quarter, rising from the March time frame. And you said all 3 end markets would grow. I was curious if you could give us some color just for modeling purposes, whether one will outperform the other? Or where do you think you'll get more traction based on your backlog?

首先，衷心恭喜。能夠優於預期，並且在逐季基礎上實際上調指引的公司並不多，所以表現非常出色。我有兩個簡短問題。第一個，Steve，你談到6月季度的強勁表現，相較於3月期間有所上升，並表示三個終端市場都會成長。就建模目的而言，我想了解你是否能提供一些補充資訊：是否有某一個市場會優於其他市場？或是根據你們的在手訂單（backlog），你認為哪裡會有更大的動能？

Thanks, Harsh. So we think that the data center will lead the growth going into the next quarter, probably a double-digit growth -- strong double-digit growth. And then Telecom and I&D, I would say, mid-single digits, plus or minus, a little bit.

謝謝你，Harsh。我們認為資料中心將引領下一季的成長，可能會是兩位數成長——強勁的兩位數成長。至於電信與I&D，我會說大約是中個位數成長，上下略有一些波動。

Okay. And then for my follow-up, you guys have a bunch of strategic products in the pipeline, I believe, for the rest of the year. We're hearing 10-gig PON is coming back in China in a strong way. I believe you guys were also working on PAM4 analog product. And you might have referred to that in some of the demo information. I was curious if you could give us some idea of some of these critical products. Are they still on track despite COVID and all that's going on here in the world?

好的。那我的追問是，你們今年剩餘時間我相信有一批策略性產品在研發管線中。我們聽說中國的10G PON正強勢回歸。我也相信你們在做PAM4類比產品，而且你們可能在一些展示資訊中提到過。我想請問你能否談談其中一些關鍵產品的情況。在COVID以及全球目前發生的各種狀況下，它們是否仍按計畫推進？

Sure. So I would say, generally speaking, our R&D team is doing a great job holding schedules and continuing to move ahead and make reasonable results given the current situation. I will say that there have been some minor delays in terms of getting product tested in the labs, given the social distancing and whatnot that we're practicing. But generally speaking, we're on plan for where we want to be and where we want to go in terms of product development and product launches. And I'll just highlight maybe as an example, we are well ahead of last year's total product introductions even given the COVID-19 pandemic situation. So the team is really stepping up and doing a great job. In terms of some of those strategic programs that you've talked about, you're correct, we do have quite a few of them. Whether it be some of our silicon photonic work that we're doing, some of our advanced laser work, some of our power amplifier process technology work that we're doing as well as challenging our analog designers to design analog solutions at higher data rates. So there's probably too much there to drill down on and to discuss in any level of detail. But I would say, generally speaking, we have a solid plan. We're executing to the plan. We are not updating any pivots per se on any of those strategic programs that I think you're referring to. So it's really steady progress at this stage.

當然。整體而言，我會說我們的研發團隊在目前情況下仍做得非常好，能夠維持時程並持續推進，也取得合理成果。我也要說，由於我們在實施社交距離等措施，在實驗室進行產品測試方面確實出現了一些小幅延遲。但整體來說，就產品開發與產品上市而言，我們仍按計畫推進，符合我們希望達到的位置與方向。我舉個例子：即使在COVID-19疫情的情況下，我們今年的新產品導入數量仍明顯領先去年全年總量。因此團隊確實挺身而出，表現非常出色。至於你提到的那些策略性計畫，你說得沒錯，我們確實有不少。包括我們正在進行的一些矽光子（silicon photonic）工作、一些先進雷射工作、一些功率放大器製程技術工作，以及挑戰我們的類比設計人員在更高資料速率下設計類比解決方案。這些內容可能太多，無法在此深入或做任何程度的細節討論。但整體而言，我們有一個扎實的計畫，並依計畫執行。就你所指的那些策略性計畫而言，我們目前並未對其進行任何所謂的轉向或更新。因此在這個階段就是穩健推進。

Our next question comes from Quinn Bolton with Needham.

我們的下一個問題來自Needham的Quinn Bolton。

It's Michelle on for Quinn. Congrats on the quarter. I just had one question. In terms of -- for 2Q, you mentioned that customers are pulling in inventory to prevent risk of future supply constraints. I'm just wondering, and maybe I missed this, but I assume you're saying that it's going into the third quarter, and I'm just wondering, is that more on Telecom side or Data Center side or both? Or maybe you can give a little bit of color on which markets you're seeing that?

我是代Quinn提問的Michelle。恭喜這一季的表現。我只有一個問題。關於第2季，你提到客戶正在提前拉貨以避免未來供應受限的風險。我想確認一下，也許我漏聽了，但我理解你的意思是這會延續到第3季。我想問的是，這種提前拉貨比較偏向電信端、資料中心端，還是兩者都有？或者你能否補充一下你們在哪些市場看到這種情況？

Yes, that's fine. And maybe I'll just give some general background, and then Jack can quantify it for us. So I have to say that we've had some tremendous bookings over the past number of months. And so we actually believe the majority of this -- the vast majority of this is end market demand driven, and only a small fraction is actually sort of overreacting and sort of panic buying due to the COVID situation. I would say that the strength in the bookings is coming from Data Center and Telecom, and then to a lesser degree, I&D.

是的，沒問題。而且也許我先提供一些整體背景，然後再請 Jack 幫我們量化一下。所以我必須說，過去幾個月我們的接單表現非常亮眼。因此我們實際上認為其中大多數——絕大多數——是由終端市場需求所驅動，只有一小部分是因 COVID 情況而出現的某種過度反應、帶有恐慌性提前採購。我會說，接單強勁主要來自資料中心與電信，其次才是 I&D。

I'll also highlight that our channel inventory is very healthy right now. We've been monitoring our channel partners and distributors, and their inventories have been moving down over the past 6 months really by our design. And so we're very pleased with the level of inventory in the channel. We see very strong bookings, which we believe are end demand driven. I will say we do see a bit of softness in Europe. If I were to call out any 1 territory or region that's sort of softer than the others, it would certainly be across Europe. And Jack, I don't know whether you want to quantify in terms of levels where we may think customers are buying a little bit ahead of demand.

我也要強調，我們目前的通路庫存非常健康。我們一直在監控通路夥伴與經銷商，而他們的庫存在過去 6 個月確實依照我們的設計持續下降。因此我們對通路端的庫存水位非常滿意。我們看到非常強勁的接單，我們相信這是由終端需求所驅動。我會說，我們確實在歐洲看到一些疲軟。如果要點名任何一個相對其他地區更疲弱的區域，那肯定是整個歐洲。Jack，我不確定你是否想就我們認為客戶可能略微超前需求採購的程度做個量化。

Yes. So with regard to some of those types of orders, we don't believe it's significant. We do have active conversations with our customers to try and get an understanding of the ultimate end use demand or whether they're stocking these items. But if we were to quantify it, it's probably less than 5%.

是的。關於這類型的訂單，我們不認為影響顯著。我們確實與客戶保持積極對話，試圖了解最終的終端用途需求，或他們是否是在囤貨。但如果要量化的話，可能不到 5%。

Okay. That's helpful. And if I can actually just sneak another one in there. Huawei, I know you guys said that they had significantly declined after the -- being placed on the trade restriction entity list. So just wondering, though, did you see any sort of increase in the second quarter from -- of the first quarter? Or what the change, if any, at all, in Huawei orders?

好的。這很有幫助。那如果我再偷偷加問一題。華為方面，我知道你們說在——被列入貿易限制實體清單之後——他們的訂單已大幅下滑。不過我想問的是，你們在第二季是否看到相較第一季有任何增加？或者說，華為訂單有沒有任何變化（如果有的話）？

Yes. Thanks, Michelle. So in terms of Huawei, they've been a less than 10% customer for quite a few years now. As we've been stating in some of the prior discussions, their revenue has been declining for us over time. So really no meaningful change to that.

是的，謝謝你，Michelle。就華為而言，他們多年來一直是我們占比不到 10% 的客戶。正如我們在先前的一些討論中所提到的，他們對我們的營收隨時間一直在下降。所以這方面沒有任何有意義的變化。

Our next question comes from Tom O'Malley with Barclays.

我們下一個問題來自 Barclays 的 Tom O'Malley。

Congratulations on the strong results. I just want to start out with the guidance. You obviously are taking some consideration of some COVID impact.

恭喜你們交出強勁的結果。我想先從財測開始。你們顯然把一些 COVID 的影響納入考量。

If you just take kind of the midpoint of what you described as double-digit growth in Data Center and then mid-double digits in Telecom and Industrial, you get a little bit above your range. Can you talk about where you're being cautious? And what areas you think you're giving yourself a little bit of room to get back in the range that you're guiding?

如果把你們所描述的資料中心兩位數成長的中位數，以及電信與工業中雙位數成長的中位數加總起來，會得到一個略高於你們指引區間的數字。你們能談談你們在哪些地方比較保守嗎？以及你們認為在哪些領域給自己留了一點空間，好讓數字回到你們所給的指引區間？

Yes. So I think our ops team is working very closely with our sales organization to make sure that we come up with the most accurate guidance that we can give. I wouldn't necessarily want to carve out any 1 end market or customer or even product line. It's really making sure that operations understands the -- any associated risks with the forecast for the third quarter. Now the good news is we have a very high backlog for the third quarter, and we're already 1 month into the quarter. So we're very comfortable with the supply chain risks that are sort of built into our guidance. And so we think we're doing all the right things in terms of planning. I will say that generally speaking, the supply chain is recovering. So in areas where we've started maybe a month or 2 months ago, where we were seeing impacts and shutdowns, we are seeing our suppliers come back online. That's not only in Asia, but also across Europe and here in the U.S. I will say, by the way, from a supply chain point of view, we effectively had no interruptions from our third-party wafer foundries. So the good news is we were able to receive the materials that we needed. Our fab remained completely operational. So from a raw material point of view, we're in a very good position to service not only the third quarter but also beyond. So I think our guidance is as accurate as we can make it, given all these different moving parts.

是的。我認為我們的營運團隊正與銷售組織非常緊密合作，以確保我們提出能給出的最準確指引。我不一定想把任何單一終端市場、客戶，甚至產品線單獨挑出來。重點是確保營運端理解——第三季預測所伴隨的任何相關風險。好消息是，我們第三季的在手訂單（backlog）非常高，而且我們已經進入本季第 1 個月了。因此對於指引中所納入的供應鏈風險，我們感到非常安心。我們認為在規劃方面我們做了所有正確的事情。我會說，整體而言，供應鏈正在復甦。所以在一些地方，大約 1 到 2 個月前我們曾看到影響與停工，現在我們看到供應商正在恢復運作。這不僅在亞洲，也遍及歐洲以及美國。順帶一提，從供應鏈角度來看，我們基本上沒有受到第三方晶圓代工廠的中斷影響。好消息是，我們能夠收到所需的材料。我們的晶圓廠（fab）也一直完全維持運作。因此就原物料角度而言，我們處於非常有利的位置，不僅能支援第三季，也能支援更往後的需求。所以我認為，在這些不同變動因素之下，我們的指引已經是我們能做到的最準確水準。

Great. And then just a quick follow-up. You mentioned that Huawei revenue was going up, but you're also seeing sequential growth in Telecom. Clearly, there's a number of tenders that are coming out in China right now for optical builds. Where are you seeing the sequential growth in Telecom? Is that U.S.-based? Or are you participating in the Chinese ramps elsewhere outside of Huawei?

很好。接著一個快速追問。你提到華為營收在上升，但你們也看到電信業務的季對季成長。很明顯，中國目前有不少光纖建設的標案正在釋出。你們在電信的季對季成長主要來自哪裡？是以美國為主嗎？還是你們在華為以外，也有參與中國其他客戶的拉升？

Yes. So I would say that it's primarily 5G-driven, and the majority of that activity is China-based. And then as you drill down and look at the OEMs and their customers and their suppliers, we try to service as many as we can. I wouldn't want to call out any 1 particular OEM in terms of our position as it relates to optical infrastructure. I think the key point here is we are seeing more opportunities. The volumes are going up. We have very compelling technology for 5G fronthaul and mid-haul for analog solutions, laser solutions, detector solutions that I talked about. So we actually have a very strong product set for the 5G rollout on the optical side, which is what you're referring to. So I think it's really more than just any 1 customer driving our demand. We see lots of demand from lots of customers.

是的。我會說主要是由 5G 驅動，而且其中大部分活動是以中國為主。接著當你再往下看 OEM、他們的客戶以及他們的供應商時，我們會盡可能服務越多越好。我不想就我們在光學基礎建設相關的布局點名任何單一 OEM。我認為這裡的關鍵是，我們看到更多機會。出貨量正在上升。我們在 5G 前傳（fronthaul）與中傳（mid-haul）的類比解決方案、雷射解決方案、偵測器解決方案（我剛才提到的）方面，擁有非常具競爭力的技術。因此在光學端、也就是你所指的 5G 佈建上，我們其實有非常強的產品組合。所以我認為，驅動我們需求的不只是任何單一客戶。我們看到來自許多客戶的大量需求。

Our next question comes from Richard Shannon with Craig-Hallum.

我們下一個問題來自 Craig-Hallum 的 Richard Shannon。

Steve, in your prepared remarks, you talked about -- finding my notes here, you talked about some market share gains. And I think you're referring to both Data Center and Telecom. Can you give us more detail on where that's coming from, which products in geographies or customers that that's relevant to?

Steve，在你準備好的發言中，你提到——我在找我的筆記——你談到一些市占率提升。我想你指的是資料中心與電信兩個領域。你能提供更多細節嗎？這些提升是從哪裡來的、涉及哪些產品、哪些地理區域或客戶？

Absolutely. So I would probably start with our diode products. So we are -- our team within our diode business unit has really been doing a very nice job, picking up business that previously we may have been losing. There is a renewed effort to drive growth in our Industrial & Defense end markets, which means taking our existing technologies, repackaging, repricing. In some instances, screening. So that is certainly an area where I see market share gains. Typically, our competitors in this technology area are weaker than us. So it's our goal to continue to put pressure on these smaller and weaker competitors and win that business. In terms of the other areas, I would probably also highlight our HPA or high-performance analog team is doing a very good job winning business, not only with 100G analog solutions and picking up new customers, but also going into adjacent markets. Part of our strategy will be to expand beyond the Data Center and beyond Telecom with some of our high-performance analog design capability. And so we're starting to see new opportunities and win business and go after business that maybe a year or 2 years ago we wouldn't have gone after. And then the last thing I'll add is, I just want to emphasize that 5G architecture really plays to MACOM strengths with the very large optical piece of that network. And this is an area where a year ago, 2 years ago, we had no business. So the fact that there's a large optical component there is going to drive our growth in the months and quarters ahead. And that includes, by the way, not only the fronthaul piece, but also the mid-haul piece.

當然可以。我可能會先從我們的二極體產品開始。我們——我們二極體事業部的團隊確實做得非常好，拿回了過去我們可能正在流失的業務。我們重新投入推動工業與國防（Industrial & Defense）終端市場的成長，這意味著把既有技術重新包裝、重新定價；在某些情況下，還會做篩選（screening）。因此這確實是我看到市占率提升的一個領域。通常在這項技術領域，我們的競爭對手比我們弱。所以我們的目標是持續對這些規模較小、實力較弱的競爭者施加壓力並贏得這些業務。至於其他領域，我也會特別提到我們的 HPA（高效能類比）團隊在贏得業務方面做得非常好，不僅在 100G 類比解決方案上拿下新客戶，也在切入相鄰市場。我們策略的一部分，是運用我們的高效能類比設計能力，擴展到資料中心與電信以外的市場。因此我們開始看到新的機會、贏得訂單，並追逐一些可能在 1、2 年前我們不會去追的業務。最後我想補充的是，我要強調 5G 架構確實非常符合 MACOM 的強項，因為該網路中有非常大的光學部分。而這是我們在 1 年前、2 年前完全沒有業務的領域。因此其中龐大的光學組成將在未來幾個月與幾個季度推動我們的成長。而且這也包括——順帶一提——不僅是前傳（fronthaul）部分，也包括中傳（mid-haul）部分。

Okay. A follow-on question, I guess, kind of following the end of your response here to the Telecom market. You've talked about 5G mostly within that segment. And I guess from your other comments, it would be a relatively small piece of the Telecom from a dollar point of view. So how do we reconcile the rather small concentration or exposure there with your fairly strong growth both in March and June quarters here. Is 5G driving most of that? Or is there also some benefit coming from PON and backhaul and other things like that?

好的。我想接著問一個延伸問題，算是延續您剛才對電信市場回覆的最後部分。您談到 5G 主要是在那個區隔之內。而且我想從您其他評論來看，從金額角度，5G 在整體電信裡應該只占相對小的一部分。所以，我們要如何把那邊相對小的集中度或曝險，與您在這裡 3 月與 6 月季度都相當強勁的成長做一致的解讀？是 5G 驅動了大部分成長嗎？還是也有一些來自 PON、回傳（backhaul）以及其他類似項目的助益？

So I would say that there's, this quarter and going into next quarter, less growth on the PON side and it's more on the 5G side. We did have actually some significant growth going from Q4 to Q1 this year. And now we're seeing that growth continue. I think it was just 2 quarters ago or 3 quarters ago, the Telecom market was below $40 million, and this quarter, we're above $50 million. So we like the growth. We like a steady business and the diverse type of business that the 5G market is bringing to us. I will highlight that there are areas of bright spots. Of course, there's also areas where we need to do a lot of work, including on the RF boards within the 5G radios themselves. It's a very competitive market. Today, we support the market successfully with front-end modules and high-power switches. But we have a lot of work to do on the power amplifier side. So that's an area where we are behind and we do need to do a lot of work there, and we recognize that. And so we're going to build that into our strategy as we move ahead.

我會說，本季以及進入下季，PON 端的成長比較少，更多是在 5G 端。我們確實在今年從 Q4 到 Q1 出現了一些顯著成長，而現在我們看到那個成長在延續。我想就在 2 個季度前或 3 個季度前，電信市場還低於 4,000 萬美元，而本季我們已經超過 5,000 萬美元。所以我們喜歡這個成長。我們喜歡穩健的業務，以及 5G 市場帶給我們多元化的業務型態。我也要強調有一些亮點領域。當然，也有一些我們需要做很多工作的領域，包括 5G 無線電本體內的 RF 板卡。這是一個競爭非常激烈的市場。今天，我們透過前端模組與高功率開關成功支援市場。但在功率放大器端，我們還有很多工作要做。所以那是我們落後的領域，我們確實需要在那裡投入大量工作，我們也認知到這點。因此，隨著我們往前推進，我們會把這些納入策略之中。

Our next question comes from Harlan Sur with JPMorgan.

我們的下一個問題來自摩根大通（JPMorgan）的 Harlan Sur。

Great job on the quarterly execution. Strong gross margin performance, if I look at the March quarter results and June quarter guidance, your incremental gross margins on the incremental revenue growth is falling through at about 70%. Historically, it's been about 60% to 65%, so pretty strong step-up. Is that more a function of mix? Or is that a combination of mix and the manufacturing efficiencies driving lower costs? And going forward, is this how we should think about the gross margin contribution on revenue growth?

本季執行表現很出色。毛利率表現強勁；如果我看 3 月季度的結果與 6 月季度的指引，您在增量營收成長上的增量毛利率大約有 70% 的落袋（fall-through）。歷史上大約是 60% 到 65%，所以這次提升相當明顯。這更多是產品組合（mix）的因素嗎？還是產品組合加上製造效率提升、帶動成本下降的綜合結果？往前看，我們是否應該用這樣的方式來看待營收成長對毛利率的貢獻？

Yes. This is Jack. So in terms of that step-up that we're seeing going from Q2 to our Q3 guide, there's a number of different elements that come into play there. Obviously, the increase on the top line helps in terms of the overall gross margin step-up that we're showing here in the quarter. There's been a number of initiatives that we've been working throughout the company that are ultimately driving that sequential margin improvement that you've been seeing over the past couple of quarters. And this is the next natural step in our progression from a guidance range perspective.

是的。我是 Jack。就我們看到從 Q2 到 Q3 指引的這個提升而言，當中有幾個不同因素在發揮作用。很明顯，營收端的增加有助於本季我們所呈現的整體毛利率提升。公司內部一直在推動多項計畫，最終正驅動您在過去幾個季度看到的那種連續性毛利率改善。而這也是我們從指引區間角度來看，進程中的下一個自然步驟。

So I mean it's going to be kind of a step-by-step process as we continue to work through things and continue to execute along these initiatives that we have that are ultimately improving the margins. And mix is a big piece of how that can come into play in terms of the margin.

所以我的意思是，隨著我們持續把事情一項一項推進、並持續執行這些最終能改善毛利率的計畫，這會是一個逐步的過程。而產品組合在毛利率的形成上，是一個很重要的因素。

Okay. Great. And then on the product side, I know you mentioned some of this in the prepared remarks. But on the 5G sort of mid-haul, backhaul, depending on the distance, like we're hearing customers using 100-gig, they're using 200-gig PAM4. Some cases, they're using coherent. And then in Data Centers, you mentioned, you have customers making the early transition to 200 and 400-gig using 25 gigabaud, 56 gigabaud drivers in TIA and PAM4 DSP. These are -- these new PAM4 opportunities potentially pulls in your PAM4 DSP in addition to your TIA and drivers. Are you guys seeing the adoption of PAM4-based devices in 5G? And do you have design wins on both 200-gig 5G and 200-gig Data Center and also 400-gig for Data Center? And if so, like when would we expect to kind of see that be tangible to the revenue growth here?

好的。很棒。接著在產品面，我知道您在準備好的講稿中提到了一些。不過在 5G 的中段傳輸（mid-haul）、回傳（backhaul），取決於距離，我們聽到客戶在用 100G、也在用 200G PAM4；有些情況下，他們使用相干（coherent）。而在資料中心方面，您提到有客戶正在早期轉向 200G 與 400G，使用 25 gigabaud、56 gigabaud 的 driver，搭配 TIA 與 PAM4 DSP。這些新的 PAM4 機會，除了您的 TIA 與 driver 之外，可能也會把您的 PAM4 DSP 一起帶進來。你們是否看到 PAM4 架構的裝置在 5G 的採用？你們是否在 200G 5G、200G 資料中心，以及 400G 資料中心上都有設計導入（design win）？如果有的話，我們大概何時能期待它對這裡的營收成長開始有較具體的貢獻？

Okay. So I'm going to try to address all of those points, but if I missed some, help me. Just -- when I think about fronthaul, I think about 25-gig links. When I think about mid-haul, I think about 50-gig links. So that's our starting point. So when we think about the products that we can support fronthaul, we're specifically referring to clock and data recovery circuits, TIAs and drivers. We want to introduce 25G FP lasers, and that's something that we talked about in the script. That's something we're demonstrating, and it's a product line that we're sampling customers. When we think about 50G links now, different module form factors, we believe we have a product called PRISM-50, which is essentially a PAM4 DSP. It's a cousin of our PRISM project that we've been working on. It's in R&D. We don't have any design wins, but it's working quite nicely in this application.

好的。我會試著把這些點都回覆到；如果我漏了什麼，請提醒我。就——當我想到前傳（fronthaul），我想到的是 25G 連結；當我想到中段傳輸（mid-haul），我想到的是 50G 連結。這是我們的起點。所以當我們談到能支援前傳的產品時，我們特別指的是時鐘與資料恢復電路（CDR）、TIA 與 driver。我們希望推出 25G FP 雷射，這是我們在講稿中提到的；我們正在展示，也正在把這條產品線送樣給客戶。當我們現在想到 50G 連結、不同的模組外形規格時，我們相信我們有一個叫 PRISM-50 的產品，本質上是一顆 PAM4 DSP。它是我們一直在做的 PRISM 專案的近親。它仍在研發中。我們還沒有任何設計導入，但在這個應用上運作得相當不錯。

And so we demonstrated that just a few months ago with our lead customers and lead prospects, let's say, and we're gaining interest and traction.

因此，我們在幾個月前就已經向我們的領先客戶與領先潛在客戶（prospects）做了展示，我們正在獲得興趣與進展。

On the mid-haul piece, I would also add that the TIAs are generally very high end TIAs, and I would argue that MACOM today has the best TIA in the market. We are winning market share there as a result of that. The last item is the driver for mid-haul. And so that's another area, again, new revenue and new interest on this product line.

在中段傳輸（mid-haul）這一塊，我也要補充，TIA 通常是非常高階的 TIA；我會主張 MACOM 目前擁有市場上最好的 TIA。我們也因此正在贏得市占。最後一項是中段傳輸用的 driver。這同樣是另一個領域——在這條產品線上帶來新的營收與新的關注。

So that's a very concise review of fronthaul and mid-haul. When you go into the data -- did you have a question on that?

所以這是對前傳與中段傳輸非常精簡的回顧。當你進入資料——你對那部分有問題嗎？

No. You're right. That was very concise.

沒有。你說得對。那非常精簡。

And then I just wanted to -- I think you mentioned the Data Center in 400G. And I can tell you that there's parallels. So we are today supporting 400G and 200G applications with our TIAs as well as our 56 gigabaud drivers, okay? And so those would be supporting 200 and 400. And just if you think about the different reaches, those go all the way from short reach or SR, all the way up to long reach, LR. And so that revenue today is small. It's -- these are relatively new products, just gaining traction. It's not -- those products are not what's driving the growth today, but they will, if we go out in time, okay, if we're successful. So I hope I've answered your questions, but I do think that you're asking the right question. And I think the -- all of these products that we're talking about are relatively new. And I think MACOM is a leader in this area.

然後我還想——我想你提到了資料中心的 400G。我可以告訴你，這裡有一些相似之處。我們目前以我們的 TIA 以及 56 gigabaud 的 driver 來支援 400G 與 200G 應用，好嗎？所以這些會支援 200 與 400。再者，如果你想不同的傳輸距離（reach），它們從短距（SR）一路到長距（LR）都有。因此，目前那部分營收還很小。這些是相對新的產品，才剛開始取得進展。它們不是今天成長的驅動因素，但如果我們把時間拉長、而且我們成功的話，它們未來會成為成長動能。所以我希望我回答了你的問題；但我確實認為你問到了重點。我也認為——我們談到的這些產品都相對新。我認為 MACOM 在這個領域是領導者。

Yes. Just one more question, if I may. So on the Industrial & Defense business, as you improve the portfolio, I think much of your portfolio includes catalog products. So is the new development pipeline focused on multi-purpose diodes, multi-purpose high-performance analog and MMIC products to kind of continue to build out the catalog business? Or are you targeting more application-specific products for the various subsegments within I&D?

是的。如果可以的話，我再問最後一個問題。關於工業與國防（Industrial & Defense）業務，隨著你們改善產品組合，我想你們的產品組合中有很大一部分是型錄產品（catalog products）。那麼新的開發管線是聚焦在多用途二極體、多用途高效能類比與 MMIC 產品，以持續擴充型錄業務嗎？還是你們正針對 I&D 各子區隔，鎖定更多應用特定（application-specific）的產品？

So it's a little bit of both, and it's resource-dependent, opportunity-dependent and we want to be -- so a, we want to have our own product plan, where we want to raise the bar in terms of performance in the market. So that's an internal plan. And we always supplement those activities with custom design work, whether it's a diode, a MMIC. This is -- we want to be very friendly to our A&D customers, and we embrace that work. And again, I think this is a change of strategy. We want to do custom MMIC design work for all the major U.S. defense OEMs. And we're going to make sure that MACOM is at the table, looking at the latest specs and bidding very aggressively to win that business, because this is right in our wheelhouse. This is what we do very, very well.

所以這兩者都有一點，而且這取決於資源、取決於機會；我們希望——也就是說，我們希望有我們自己的產品規劃，在市場性能方面把標準提高。這是一個內部計畫。而且我們也一向會用客製化設計工作來補充這些活動，不論是二極體、MMIC。這是——我們希望對我們的航太與國防（A&D）客戶非常友善，我們也擁抱這類工作。再者，我認為這是一個策略上的改變。我們希望為所有主要的美國國防OEM進行客製MMIC設計工作。我們會確保MACOM坐在談判桌上，檢視最新規格並以非常積極的方式投標以贏得這些業務，因為這正是我們的強項。這就是我們非常、非常擅長的事。

And I&D is, as you know, our -- a, our largest revenue segment, but it's also the largest end market. So tremendous opportunities there.

而工業與國防（I&D）如你所知，是我們——a，我們最大的營收部門，但它同時也是最大的終端市場。因此那裡有巨大的機會。

Our next question comes from Tore Svanberg with Stifel.

下一個問題來自Stifel的Tore Svanberg。

Congratulations on this tremendous turnaround. First question, and maybe this is a bit counterintuitive. But obviously, there's a lot of questions about inventory build in the midst of the downturn. But as you talk to your customers, could we actually be seeing something completely different? Meaning, if you think about data center, 5G, are customers actually maybe pulling in some of those deployments, maybe even accelerating them somewhat?

恭喜這次驚人的扭轉。第一個問題，也許這有點反直覺。但顯然，在景氣下行期間，大家對庫存建立有很多疑問。不過當你們與客戶交談時，我們是否其實可能看到完全不同的情況？也就是說，如果你想到資料中心、5G，客戶是否可能正在把部分部署提前，甚至在某種程度上加速？

It's very possible, Tore. And this is a question we're asking as well. As we look at the strong bookings and so as Jack alluded to in some of his comments, when we see large orders coming in, we do a lot of investigative work to understand what's behind this. Are customers placing orders because they have won new business or are they getting ahead of expected future business? And so I think that it's a hard question to answer, but I think it is possible, yes.

很有可能，Tore。我們也在問這個問題。當我們看到強勁的接單時——正如Jack在一些評論中提到的——當我們看到有大額訂單進來，我們會做很多調查工作來了解背後原因。客戶下單是因為他們贏得了新業務，還是因為他們在為預期的未來業務提前備貨？所以我認為這個問題很難回答，但我認為確實有可能，是的。

Very good. And maybe my perception is wrong here. But I think you mentioned some new products for test and measurement. Could that be kind of, like, the fourth leg on the stool here? And if not, is it still going to be embedded in any of the 3 categories?

很好。也許我這裡的看法不對。但我想你提到了一些用於測試與量測的新產品。那會不會有點像是這裡的「第四條腿」？如果不是，它是否仍會被納入這三個類別中的某一個？

It's an interesting question also. So I would say that our typical business in Industrial & Defense and specifically test and measurement, which is a submarket in that category, the order sizes are generally smaller than, say, some of the large, high-volume sockets that we've been talking about over the past few minutes. So I would say that this is building out the base, and it's something that will be done over time as opposed to, let's say, a fast ramp. Okay? So this is -- we look at our Industrial & Defense business, and if you go back 2 years, it's been flat. And we recognize that as a problem. And so the fix will be to design more products for the lead defense OEMs, screen products, repackaged products, and do a better job going after the accounts and -- from a sales point of view. And so there is a big opportunity there. Moving the needle and the I&D end market, it's a slow process. So I would temper expectations in terms of high growth in this area.

這也是個有趣的問題。我會說，我們在工業與國防（I&D）中的典型業務，特別是測試與量測（這是該類別中的一個子市場），其訂單規模通常比方才幾分鐘我們談到的一些大型、高出貨量的socket要小。所以我會說，這是在擴大基礎，會隨時間逐步完成，而不是例如快速爬坡。好嗎？所以這是——我們看我們的工業與國防業務，如果你回到兩年前，它一直是持平的。我們認知到這是個問題。因此修正方式將是：為領先的國防OEM設計更多產品、篩選產品、重新封裝產品，並且從銷售角度更積極地去爭取這些客戶與——帳戶。因此那裡有很大的機會。但要在I&D終端市場「推動指標」是一個緩慢的過程。所以我會在這個領域的高成長預期上稍微保守一些。

Our next question comes from Tom Diffely with D.A. Davidson.

下一個問題來自D.A. Davidson的Tom Diffely。

Kind of following on. I was hoping to get a little bit of your thoughts on exposure and the outlook for specifically the industrial markets. You mentioned you didn't have much auto exposure. I'm curious on the other industrial markets what the exposure is.

延續前面的話題。我想請教你們對曝險與展望的一些看法，特別是工業市場。你提到你們沒有太多汽車曝險。我好奇在其他工業市場的曝險程度如何。

I would say that this is 1 market that we are most concerned about. We have a lot of customers across Europe that are in the industrial sector. And so we have seen a slowdown in bookings and whatnot.

我會說這是我們最擔心的一個市場。我們在歐洲有很多屬於工業領域的客戶。因此我們已經看到接單放緩等等。

I think over the past 2 to 3 quarters, it's been relatively stable, but we are seeing a weakness, not only over the past month, but maybe the last 2 months, things have started to slow down. So the markets that would be in that area would be, for example, folks that are building test instrumentation, people that are building even medical equipments, for example, we provide essentially very unique products for MRIs, and we're seeing a bit of a slowdown there. So the good news is there's lots of customers, but the business level at any 1 customer is at a relatively low level. So we're not too concerned about it. And as I highlighted in my remarks, we have no automotive or consumer electronic exposure, and those are the parts of the semi industry that have been hit the hardest with coronavirus.

我想在過去2到3個季度相對穩定，但我們確實看到疲弱，不僅在過去一個月，可能在最近兩個月，事情開始放慢。那個領域的市場例如：製造測試儀器的人、甚至製造醫療設備的人；例如我們為MRI提供本質上非常獨特的產品，而我們也看到那裡有些放緩。所以好消息是客戶很多，但任何單一客戶的業務量都相對低。因此我們不會太擔心。而且如我在發言中強調的，我們沒有汽車或消費性電子的曝險，而那些是半導體產業中受新冠病毒衝擊最嚴重的部分。

Yes. Okay. I appreciate that. And then just a quick modeling question. We've been using an 8% tax rate. Does that change over time if Data Center or some of these other segments become a bigger piece of the pie?

是的。好的。我很感謝。接著一個快速的模型問題。我們一直使用8%的稅率。如果資料中心或其他一些部門在營收組合中占比變大，這個稅率會隨時間改變嗎？

At this stage, Tom, 8% is where we're looking for the remainder of the year from a tax rate -- from non-GAAP tax rate perspective.

在這個階段，Tom，從非GAAP稅率的角度來看，8%是我們對今年剩餘期間的預期。

Our next question comes from Tim Savageaux with Northland Capital Markets.

下一個問題來自Northland Capital Markets的Tim Savageaux。

I'll add my congrats. A question back on the Telecom side. You were looking for high single-digit growth, I guess, mid to high. For Q2, you ended up around 13%. And I wonder if you could talk about what surprised you to the upside there. I know you've mentioned 5G fronthaul, mid-haul as a driver. You were seeing strength there previously. So if you look at fiscal Q2 in particular, looking across your 5G-related markets, maybe just channel optical transport or PON, can you talk about where the upside was in the quarter? And I have a follow-up.

我也要表示祝賀。回到電信這邊的一個問題。你們原本預期是高個位數成長，我想是中到高個位數。第二季你們最後大約是13%。我想請你談談有哪些超出預期的正面驚喜。我知道你提到5G前傳（fronthaul）、中傳（mid-haul）是驅動因素，你們之前就看到那裡的強勁。如果看財務第二季，橫跨你們與5G相關的市場，可能像是光傳輸通道或PON，你能談談本季的超預期主要來自哪裡嗎？我還有一個追問。

Yes. So I'm not sure I would say that we were surprised by the results for Q2 in any of our markets. They behaved fairly in line with what we were signaling on our last call, where, in fact, we had signaled that I&D was down this quarter, which it was. So in terms of the areas where we saw strength, again, it was the fronthaul market, which is 25G modules essentially. And I would also sort of maybe add on top of that, we had some strong business with some of our metro long-haul products. So that's sort of similar end application, right? So I would probably call out those 2 items as the ones that really drove the upside.

是的。所以我不確定我會說我們在第二季任何市場的結果讓我們感到意外。它們的表現大致符合我們在上次電話會議所傳達的訊號；事實上，我們也曾指出I&D本季會下滑，而確實如此。就我們看到強勁的領域而言，再次，是前傳市場，基本上是25G模組。另外我也可能補充一點：我們的一些都會長途（metro long-haul）產品也有不錯的業務。所以那是類似的終端應用，對吧？所以我大概會點出這兩項是推動超預期的主要因素。

Great. And to follow up on that, you mentioned a couple of quarters ago, you're under $40 million in Telecom, now you'll be at least with your guidance, maybe into the -- close to the mid-50s. If you look at that kind of growth over that time period, I wonder if you can kind of segmented along the same lines in terms of end market or application driver. Should we assume that the bulk of that, the majority is 5G fronthaul and mid-haul driven or are there any -- or should we look at it basically is the same way you just described the upside drivers for Q2? Is there anything else going on there if you look over that longer time period?

很好。針對這點追問，你們幾個季度前提到電信營收低於4,000萬美元，現在依你們的指引，至少可能到——接近5,000多萬美元的中段。如果看這段期間的成長，我想請你大致按終端市場或應用驅動來拆分一下。我們是否應該假設其中大部分、主要是由5G前傳與中傳所驅動？或者——或者我們是否應該基本上用你剛才描述第二季超預期驅動因素的方式來看？如果拉長到這段期間，還有其他因素嗎？

Yes. So the Telecom category is actually a large category for us. So it includes more than just 5G. It includes access, a whole variety of wireless and applications. So it would be a fair amount of work to kind of go down that list of sort of takes and puts. It includes VoIP as well, which has been a legacy business that we've had. So I wouldn't necessarily want to call out any 1 of the submarkets. I will say that some of our most exciting technology that we're developing, including the laser technology, the analog solutions, the power products including power switches and power amplifiers for this end market are compelling products. And so we're pleased with the growth. We recognize we have a lot of work to do. We recognize that we're still below some of the prior year peaks in this area, especially when 2.5G PON was running. So we recognize we have a lot of work to do in this area.

是的。所以電信其實對我們而言是一個很大的類別。因此它不只包含5G。它包含接入（access）、各式各樣的無線與應用。要把那份清單逐一說明各項增減，會需要相當多的工夫。它也包含VoIP，這一直是我們的傳統業務之一。所以我不一定想特別點名任何一個子市場。我會說，我們正在開發的一些最令人振奮的技術，包括雷射技術、類比解決方案、電源產品（包含電源開關與功率放大器）在這個終端市場都是很有吸引力的產品。因此我們對成長感到滿意。我們也認知到我們還有很多工作要做。我們也認知到在這個領域，我們仍低於過去年份的一些高峰，特別是在2.5G PON運行得很旺的時候。所以我們知道在這個領域還有很多工作要做。

Our next question comes from Mark Lipacis with Jefferies.

我們的下一個問題來自 Jefferies 的 Mark Lipacis。

The Department of Commerce introduced some new export control actions. Looks like it's targeted at the military area to prevent acquisition of technologies under civilian use pretenses for military end uses. I'm wondering if you guys had a chance to look at that yet. And if you had any view of that if that might impact you? And then separately and related, given all the focus on China, can you give us a sense of what percent of your products are actually consumed in China?

商務部推出了一些新的出口管制措施。看起來是針對軍事領域，旨在防止以民用名義取得技術、但最終用於軍事用途。我想請問你們是否已經有機會研究過？以及你們是否認為這可能會對你們造成影響？另外，且相關地，鑑於大家都很關注中國，你們能否讓我們了解一下，你們的產品實際在中國被消費的比例大約是多少？

Sure. So we are aware of the new BIS announcement that came out, I think, on Tuesday. Jack and I have both been briefed by our internal counsel as well as our trade compliance folks to understand the details of that. Our initial assessment is that it really won't impact our business. A lot of the categories and the additional restrictions that are being put into place at first review don't look like they're going to impact us. So -- but we are aware of that. And to the extent that we need to make adjustments to any of our procedures or policies, we'll certainly do that. In terms of our exposure to China, I think our last output on that number was...

當然。我們已注意到新的 BIS 公告，我想是在週二發布的。Jack 和我都已由我們的內部法務顧問以及貿易合規團隊進行簡報，以了解其細節。我們的初步評估是，這應該不會影響我們的業務。許多新增限制所涵蓋的類別，初步看起來不太會影響到我們。所以——但我們確實已知悉此事。若我們需要對任何流程或政策做出調整，我們當然會去做。至於我們對中國的曝險，我想我們上一次對外提供的數字是……

It's running in the low 30% range from a ship-to perspective.

從出貨目的地（ship-to）的角度來看，大約落在 30% 出頭的區間。

So low 30s.

所以是 30% 出頭。

That's ship-to. And do you have a sense of what the consumption is by any chance?

那是出貨目的地（ship-to）。那你們是否大概知道實際消費量（consumption）是多少？

Unfortunately, at this stage, we -- it's a tough one to figure out in terms of what's being consumed internally there versus reexporting.

很遺憾，就目前階段而言，我們——要判斷其中有多少是在當地內部消費、又有多少是再出口，這很難釐清。

Our next question comes from C.J. Muse with Evercore.

我們的下一個問題來自 Evercore 的 C.J. Muse。

You talked earlier on the call about winning share in TIAs. And curious, how big of a market do you think that is? Can you share with us how accretive that is to margins? And then, I guess, interestingly, does the market share shift there enable you to bundle other components? And do you get to kind of double the win because of it?

你們先前在電話會議中提到在 TIA 上取得市占。想請教，你們認為那會是一個多大的市場？能否分享一下，這對毛利率的增益有多大？另外，我想也很有意思的是，那裡的市占轉移是否讓你們能夠把其他元件一起打包銷售？你們是否因此能某種程度上「一魚兩吃」，等於拿到雙重勝利？

So probably it'd be difficult for me to explain the margin -- answer the margin question. We don't typically breakout gross margins by product line. And today, it's a small piece of our revenue. So it's really not accretive at this stage.

所以，毛利率——要我回答毛利率的問題可能會比較困難。我們通常不會按產品線拆分揭露毛利率。而且目前它在我們營收中占比很小，所以在這個階段其實還談不上對毛利有明顯增益。

In terms of the bundling piece, we want to provide the customer value on a part-by-part basis. And oftentimes, when you bundle 2 parts and force a customer to buy something they really not want to buy, it -- you get a blowback effect. Our go-to-market strategy is to put the best products out there that we can, have a very compelling price. And whether they buy our TIA or our laser diode or our CDR, we want to provide a very professional approach to make sure that they pick the parts they want and they're not penalized if they don't buy all of it, let's say. So we really don't practice the bundling the way you've sort of described. In terms of the size of the market, I'm sure if I gave you a number, it would probably be incorrect. So I want to shy away from that.

至於打包（bundling）這一塊，我們希望在每一個零件（part）層級都能為客戶提供價值。很多時候，當你把兩個零件綁在一起，迫使客戶購買他其實不想買的東西時——會產生反彈效應。我們的市場策略是推出我們能做出的最佳產品，並提供非常有競爭力的價格。不論他們買我們的 TIA、雷射二極體（laser diode）或 CDR，我們都希望以非常專業的方式，確保他們選到想要的零件；即使他們沒有把所有東西都買齊，也不會因此受到懲罰。也就是說，我們並不會像你所描述的那樣去做打包銷售。至於市場規模，如果我現在給你一個數字，可能反而是不正確的，所以我想先避免回答。

Okay. That's helpful. And if I could just follow-up. In terms of kind of this new world with COVID, and hopefully, it doesn't last that long. But how are you thinking about cash that you want to have on-hand today? And therefore, how do we think about the pay down of debt as your cash level exceeds that perhaps new level?

好的，這很有幫助。如果我可以再追問一下：在 COVID 這種「新世界」之下——希望不會持續太久——你們現在對於需要保留多少手頭現金是怎麼思考的？因此，當你們的現金水位超過那個可能的新目標水位時，我們應該如何看待你們償還債務（pay down of debt）的節奏？

Great question. Jack, do you want to maybe start with that?

問得很好。Jack，你要不要先談談？

Yes. So C.J., obviously, we've done quite a bit of modeling going back over to the summer of 2019 time period. And there's a fair amount of modeling that we've put together some upside, some downside as we work our way through it. So to some extent, we've had a head start on the modeling aspects and what a potential downturn might look like and how that might impact us. But where we stand today, we're fairly confident in our liquidity position and the cash balances that we have. So we're looking to keep our heads down and keep moving forward.

好的。C.J.，很明顯地，我們做了相當多的模型分析，回溯到 2019 年夏天那段時間。我們建立了不少模型，包含一些上行情境、一些下行情境，並在推進過程中持續調整。所以在某種程度上，我們在建模面向上已經有了先行的準備，並思考潛在衰退可能長什麼樣子、以及可能如何影響我們。但就我們目前的狀況而言，我們對自身的流動性部位以及現金餘額相當有信心。因此我們會專注把頭埋下去，持續向前推進。

We feel like the additional improvements we've made in the profitability and the cash flow generation will provide us with quite a few options as we go forward from a liquidity standpoint.

我們認為，我們在獲利能力與現金流創造方面所做的額外改善，將在流動性角度上，為我們未來提供相當多的選項。

Yes, and I'll just add to that. It's kind of interesting, if you look back over the past period of times, we just delivered the lowest OpEx in 14 quarters. We delivered better gross margins for all of our fiscal '18 and '19. So the team has done a great job there. And our operating income as a percentage of total revenue is, I think, better than what we've done over the past 10 quarters. So it's really, as Jack said, doing the things that we're doing to prepare for uncertainty and to build a strong business regardless of COVID or losing a main customer or a main market or having a competitor come in. We run a very diversified solid business that our goal is to make it a business that is very strong. And I think the employees of MACOM are doing a fantastic job to that end.

是的，我再補充一下。這其實滿有意思的：如果你回頭看過去一段時間，我們剛剛交出了 14 個季度以來最低的營業費用（OpEx）。我們在 2018 與 2019 兩個會計年度的毛利率也都更好。所以團隊在這方面做得非常出色。而我們的營業利益占總營收的比例，我想也比過去 10 個季度的表現更好。正如 Jack 所說，這就是我們正在做的事情：為不確定性做好準備，打造一個強健的企業，不論是面對 COVID、失去主要客戶或主要市場、或是有競爭對手加入。我們經營的是一個非常多元且穩健的業務，我們的目標是把它打造得非常強大。我認為 MACOM 的員工在這方面做得非常出色。

Thank you. This concludes our question-and-answer session. I would now like to turn the call back over to Steve Daly for closing remarks.

謝謝。問答環節到此結束。接下來我想把電話交回給 Steve Daly 作結語。

Thank you. In closing, Jack and I would like to thank our employees for their extraordinary efforts and accomplishments during the past quarter. Thank you, and good evening.

謝謝。最後，Jack 和我想感謝我們的員工在上一季度所付出的非凡努力與所取得的成就。謝謝，祝各位晚安。

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.

各位女士、先生，今天的電話會議到此結束。感謝各位參與。您現在可以掛線。