安森美 (ON) 2021 Q2 法說會逐字稿

Good day, and thank you for standing by. Welcome to the ON Semiconductor Second Quarter 2021 Earnings Conference Call. (Operator Instructions)

您好，感謝您的支持。歡迎參加安森美半導體 2021 年第二季財報電話會議。（操作員指令）

I would now like to hand the conference over to your speaker today, Mr. Parag Agarwal, Vice President of Investor Relation and Corporate Development. Please go ahead.

現在，我想將會議交給今天的發言人、投資者關係和企業發展副總裁 Parag Agarwal 先生。請繼續。

Thank you, Ren. Good morning, and thank you for joining ON Semiconductor Corporation's Second Quarter 2021 Quarterly Results Conference Call. I'm joined today by Hassane El-Khoury, our President and CEO; and Thad Trent, our CFO.

謝謝你，任。早安，感謝您參加安森美半導體公司 2021 年第二季業績電話會議。今天與我一起出席的還有我們的總裁兼執行長 Hassane El-Khoury；以及我們的財務長 Thad Trent。

This call is being webcast on the Investor Relations section of our website at www.onsemi.com. A replay of this webcast, along with our 2021 second quarter earnings release, will be available on our website approximately 1 hour following this conference call, and the recorded webcast will be available for approximately 30 days following this conference call. Additional information related to our end markets, business segments, geographies, channels, share count and 2021 and 2022 fiscal calendar is posted on the Investor Relations section of our website.

本次電話會議將在我們網站 www.onsemi.com 的投資者關係欄位進行網路直播。本次網路直播的重播以及我們的 2021 年第二季財報將在本次電話會議結束後約 1 小時在我們的網站上提供，錄製的網路直播將在本次電話會議結束後約 30 天內提供。有關我們的終端市場、業務部門、地區、通路、股票數量以及 2021 年和 2022 年財年的其他資訊已發佈在我們網站的「投資者關係」部分。

Our earnings release and this presentation includes certain non-GAAP financial measures. Reconciliation of these non-GAAP financial measures to the most directly comparable measures under GAAP are included in our earnings release, which is posted separately on our website in the Investor Relations section.

我們的收益報告和本簡報包括某些非公認會計準則財務指標。這些非 GAAP 財務指標與 GAAP 下最直接可比較指標的對帳包含在我們的收益報告中，該報告在我們網站的「投資者關係」部分單獨發布。

During the course of this conference call, we'll make projections on other forward-looking statements regarding the future events or future financial performance of the company. The words believe, estimate, project, anticipate, intend, may, expect, will, plan, should or similar expressions are intended to identify forward-looking statements. We wish to caution that such statements are subject to risks and uncertainties that could cause actually events to our results to differ materially from projections. Important factors that can affect our business, including factors that could create actual results to differ from our forward-looking statements, are described in our most recent Form 10-K, Form 10-Qs and our filings with the Securities and Exchange Commission. Additional factors are described in our earnings release for the second quarter of 2021. Our estimates or other forward-looking statement may change, and the company assumes no obligation to update forward-looking statements to reflect actual results, change assumptions or other events that may occur except as required by law.

在本次電話會議期間，我們將對其他有關公司未來事件或未來財務表現的前瞻性陳述做出預測。相信、估計、預期、預期、打算、可能、期望、將、計劃、應該或類似的表達旨在識別前瞻性陳述。我們希望提醒的是，此類聲明受風險和不確定性的影響，可能導致實際結果與預測有重大差異。我們最新的 10-K 表、10-Q 表以及我們向美國證券交易委員會提交的文件中描述了可能影響我們業務的重要因素，包括可能導致實際結果與我們的前瞻性陳述不同的因素。我們在 2021 年第二季的財報中描述了其他因素。我們的估計或其他前瞻性陳述可能會發生變化，除非法律要求，否則公司不承擔更新前瞻性陳述以反映實際結果、變化假設或可能發生的其他事件的義務。

Our Analyst Day is scheduled for Thursday, August 5 in New York City. We look forward to seeing you in person data this week.

我們的分析師日定於8月5日星期四在紐約市舉行。我們期待本週親自見到您。

Now let me turn it over to Hassane. Hassane?

現在讓我把話題交給哈桑。哈桑？

Thank you, Parag, and thank you, everyone, for joining us today. We delivered record results in Q2, driven by strong execution and broad-based strength in demand. We posted record revenue of $1.67 billion, an increase of 38% year-over-year and 13% quarter-over-quarter. The non-GAAP diluted earnings per share of $0.63 grew significantly year-over-year and quarter-over-quarter as a result of the work we have been doing to restructure the company and streamline our business.

謝謝 Parag，也謝謝大家今天的參與。在強勁的執行力和廣泛強勁的需求的推動下，我們在第二季度取得了創紀錄的業績。我們公佈了創紀錄的 16.7 億美元收入，比去年同期成長 38%，比上一季成長 13%。由於我們一直在進行公司結構調整和業務精簡工作，非公認會計準則攤薄每股收益為 0.63 美元，同比和環比大幅增長。

Our sharp focus on gross margin is beginning to show strong results with our Q2 non-GAAP gross margin increasing by 320 basis points quarter-over-quarter and by 760 basis points year-over-year. These sustainable improvements in our gross margin will continue as we rationalize our current portfolio and reallocate R&D investments to high-growth and margin-accretive new product development. To capture the full value of our products, we continue to evaluate our portfolio to eliminate any price to value discrepancies and focus our manufacturing on our strategic products. In addition, we continue to drive efficiency throughout our upstream and downstream supply chains and optimize our operations to reduce costs.

我們對毛利率的高度關注開始產生強勁的成果，第二季的非 GAAP 毛利率較上季成長 320 個基點，較去年同期成長 760 個基點。隨著我們合理化目前的產品組合並將研發投資重新分配到高成長、利潤增值的新產品開發上，我們的毛利率將繼續持續改善。為了充分發揮我們產品的價值，我們不斷評估我們的產品組合，以消除任何價格與價值的差異，並將我們的製造重點放在我們的策略產品上。此外，我們持續提高上下游供應鏈的效率，並優化營運以降低成本。

The demand environment continues to be robust across all end markets. For the second quarter, we posted record revenue for the automotive and industrial end markets. In addition to the company's broad-based strength in these markets, we are benefiting from the strong traction of our power and sensing products. The strong demand that we have seen over the last few quarters continued to outpace our ability to supply certain products, especially those manufactured by our foundry partners. Based on current booking trends and macroeconomic outlook, we expect that the demand will continue to outpace supply through the first half of next year.

所有終端市場的需求環境持續強勁。第二季度，我們的汽車和工業終端市場收入創下了歷史新高。除了公司在這些市場的廣泛實力之外，我們還受益於電力和感測產品的強勁吸引力。過去幾季我們看到的強勁需求繼續超出了我們供應某些產品的能力，特別是那些由我們的代工合作夥伴生產的產品。根據目前的預訂趨勢和宏觀經濟前景，我們預計明年上半年需求將持續超過供應。

We are working collaboratively with our customers to ensure the uninterrupted supply of our products in the future, having entered into long-term supply agreements with many of them already and actively engaging in discussions with several others. Long-term supply agreements, or LTSAs, are a win-win for both customers and us by guaranteeing supply to the customer and at the same time, providing better visibility and allowing us to better plan our capital allocation towards capacity expansion with a committed long-term demand outlook.

我們正在與客戶合作，以確保未來我們產品的不間斷供應，並且已經與許多客戶簽訂了長期供應協議，並積極與其他幾家客戶進行討論。長期供應協議（LTSA）對我們和客戶而言是雙贏的，因為它不僅可以保證向客戶供應，同時還可以提供更好的可視性，並使我們能夠在堅定的長期需求前景下更好地規劃資本配置，以實現產能擴張。

Let me now discuss a few highlights of our strategic end markets, starting with automotive. We set a new record for our automotive revenue in Q2 with revenue of $556 million. The success in automotive was driven by strength in our power and sensing product categories. We have emerged as a strategic supplier of highly differentiated technologies for electric vehicles with customers placing high value on the efficiency and footprint advantages provided by our power solutions. Our engagement with leading global OEMs and Tier 1s continues to expand, and I'm very bullish on our potential in the growing vehicle electrification market over the next few years.

現在讓我來討論一下我們的策略終端市場的一些亮點，首先是汽車市場。我們第二季的汽車收入創下了 5.56 億美元的新紀錄。汽車領域的成功得益於我們動力和感測產品類別的實力。我們已成為電動車高度差異化技術的策略供應商，客戶高度重視我們的電源解決方案所提供的效率和足跡優勢。我們與全球領先的 OEM 和一級供應商的合作不斷擴大，我對我們在未來幾年不斷增長的汽車電氣化市場中的潛力非常看好。

In addition to the industry-leading performance of our FETs, the key source of our differentiation is our expertise in packaging, which is critical for improving heat dissipation, increasing power output in a smaller footprint than our closest competitor and reducing the weight and cost of a power module. The efficiency of our module allows our customers to make no trade-offs between the cost of battery and the range of the vehicle. They get both.

除了我們的 FET 具有業界領先的性能之外，我們差異化的關鍵來源還在於我們在封裝方面的專業知識，這對於改善散熱、在比我們最接近的競爭對手更小的佔用空間內提高功率輸出以及降低電源模組的重量和成本至關重要。我們模組的效率使我們的客戶無需在電池成本和車輛行駛里程之間做出權衡。他們兩樣都得到了。

We continue to strengthen our leadership in automotive safety with new design wins and see the increased penetration of active safety features driving strong demand for our image sensors and ultrasonic sensors. In Q2, we secured significant wins for our image sensors on key platforms in Asia and in a few cases, we displaced the incumbents.

我們繼續透過新的設計勝利加強我們在汽車安全領域的領導地位，並且看到主動安全功能的普及率不斷提高，推動了對我們的影像感測器和超音波感測器的強勁需求。在第二季度，我們的影像感測器在亞洲主要平台上取得了重大勝利，在某些情況下，我們取代了現有供應商。

With increasing sensor content, especially in new electric vehicle platforms, we remain bullish on our ADAS business. We recently announced that AutoX had selected our intelligent sensing technologies to enable 360 vision in its generation 5 fully driverless robo-taxi. On this platform, our 28 image sensors and 4 3D LiDAR sensors eliminate blind spots and power full autonomy.

隨著感測器內容的增加，特別是在新的電動車平台上，我們仍然對我們的 ADAS 業務持樂觀態度。我們最近宣布，AutoX 選擇了我們的智慧感測技術，為其第五代全無人駕駛機器人計程車實現 360 度視覺。在這個平台上，我們的 28 個影像感測器和 4 個 3D LiDAR 感測器消除了盲點並實現了完全自主。

The industrial end market, which includes military, aerospace and medical, contributed revenue of $434 million in Q2 and representing approximately 26% of our revenue. Excluding the impact from geopolitical factors related to a specific customer, our second quarter industrial revenue increased by 29% year-over-year driven by broad-based demand and strong performance by our power and sensing technology portfolio.

包括軍事、航空航太和醫療在內的工業終端市場在第二季貢獻了 4.34 億美元的收入，約占我們收入的 26%。除與特定客戶相關的地緣政治因素的影響外，受廣泛需求和電力與感測技術產品組合強勁表現的推動，我們第二季度的工業收入同比增長 29%。

We are seeing continuing momentum for our higher-power modules and alternative energy applications given the investments in utility scale solar installations that are expected to grow worldwide to reduce the climate impact of fossil fuel-based power plants. With a broad range of power solutions and early engagement with key market disruptors, we are well positioned to grow in the market.

鑑於全球範圍內公用事業規模太陽能裝置的投資預計將增長，以減少化石燃料發電廠對氣候的影響，我們看到我們的高功率模組和替代能源應用持續保持增長勢頭。憑藉廣泛的電源解決方案以及與主要市場顛覆者的早期接觸，我們已準備好在市場上實現成長。

On the industrial automation front, we saw steep year-over-year growth in our imaging revenue, driven by machine vision and Scanning applications.

在工業自動化方面，在機器視覺和掃描應用的推動下，我們的成像收入較去年同期成長迅速。

Now I will turn the call over to Thad to provide additional details on our financial performance and guidance. Thad?

現在，我將把電話轉給泰德，讓他提供有關我們的財務表現和指導的更多詳細資訊。泰德？

Thanks, Hassane. I'm pleased to announce a record quarter as we are seeing the early impact of our transformation initiatives and our financial results. Customer demand remained strong, and the design win pipeline for our innovative power and sensing technologies continue to expand. We have been successful in securing additional supply from our internal manufacturing sites as we optimize our efficiency, which contributed to revenue at the high end of our guidance.

謝謝，哈桑。我很高興地宣布一個創紀錄的季度，因為我們看到轉型舉措和財務表現的早期影響。客戶需求依然強勁，我們創新電源和感測技術的設計獲勝管道持續擴大。隨著我們優化效率，我們成功確保了內部製造基地的額外供應，這使收入達到了預期的高點。

Based on our current outlook, we expect strength and demand to continue through the first half of 2022. The company has been executing on long-term and sustainable actions that have resulted in record revenue, earnings and free cash flow for the second quarter. In a few days at our Analyst Day, we will share our long-term strategy and operational plans to realize the full potential of the company.

根據我們目前的展望，我們預計強勁勢頭和需求將持續到 2022 年上半年。該公司一直在執行長期可持續的行動，這使得第二季的收入、收益和自由現金流創下歷史新高。幾天後的分析師日上，我們將分享我們的長期策略和營運計劃，以充分發揮公司的潛力。

So turning to the results for the quarter. We saw a broad-based strength contributing to sequential revenue growth across all end markets, regions and business units. Secular mega trends in automotive and industrial contributed to record revenue in both of these end markets and together comprised 59% of revenue. Total revenue for the second quarter was $1.67 billion, an increase of 38% over the second quarter of 2020 and 13% quarter-over-quarter versus normal seasonality of a sequential increase of 3% to 5%. Our automotive revenue grew 69% year-over-year and 8% sequentially. Industrial revenue grew 24% year-over-year and 18% sequentially.

我們來看看本季的業績。我們看到了廣泛的力量推動了所有終端市場、地區和業務部門的連續收入成長。汽車和工業領域的長期大趨勢推動這兩個終端市場的收入創下歷史新高，總計佔總收入的 59%。第二季總營收為 16.7 億美元，較 2020 年第二季成長 38%，較上季成長 13%，而正常季節性因素則較上季成長 3% 至 5%。我們的汽車收入年增 69%，較上季成長 8%。工業收入較去年同期成長24%，較上季成長18%。

Turning to the business units. Revenue for the Power Solutions Group, or PSG, was $846.6 million. PSG revenue increased by 37% year-over-year due to strength in automotive and industrial end markets. Revenue for the Advanced Solutions Group, or ASG, was $607.6 million, an increase of 42% year-over-year. In addition to the strength in automotive, ASG benefited from strength in computing, especially in high-end graphics cards. Revenue for the Intelligent Sensing Group, or ISG, in the second quarter was $215.7 million, an increase of 28% year-over-year. Strength in ISG was driven primarily by automotive.

轉向業務部門。電源解決方案集團（PSG）的收入為 8.466 億美元。由於汽車和工業終端市場的強勁成長，PSG 營收年增 37%。高級解決方案集團（ASG）的營收為 6.076 億美元，年增 42%。除了在汽車領域的優勢外，ASG 還受益於在運算領域，尤其是高階顯示卡領域的優勢。智慧感測集團（ISG）第二季營收為 2.157 億美元，年增 28%。ISG 的強勁成長主要得益於汽車產業。

GAAP gross margin for the second quarter was 38.3% and non-GAAP gross margin was 38.4%, a 760 basis point improvement year-over-year and 320 basis point improvement sequentially. Our strong gross margin performance over the last few quarters has been driven by strong execution, a favorable mix to higher-margin products, improved efficiencies in our manufacturing sites and cost-containment initiatives across the company. Our factory utilization was 83%, which was relatively consistent with Q1 at 84%. As we move forward, our fab liner strategy will allow us to continue to reduce our manufacturing footprint and overall cost structure while increasing capacity to support the demand of our customers.

第二季 GAAP 毛利率為 38.3%，非 GAAP 毛利率為 38.4%，較上年同期提高 760 個基點，較上一季提高 320 個基點。過去幾個季度，我們強勁的毛利率表現得益於強大的執行力、高利潤產品的良好組合、製造基地效率的提高以及整個公司的成本控制舉措。我們的工廠利用率為 83%，與第一季的 84% 基本一致。隨著我們的發展，我們的晶圓廠策略將使我們能夠繼續減少製造足跡和整體成本結構，同時提高產能以滿足客戶的需求。

GAAP earnings per share for the second quarter was $0.42 per diluted share. Non-GAAP earnings per share was $0.63 per diluted share as compared to $0.12 per share in the second quarter of 2020 and $0.35 in Q1. As noted earlier, this is the highest-ever quarterly non-GAAP EPS reported by the company.

第二季 GAAP 每股盈餘為每股 0.42 美元。非公認會計準則每股收益為每股 0.63 美元，而 2020 年第二季為每股 0.12 美元，第一季為 0.35 美元。如前所述，這是該公司報告的有史以來最高的季度非 GAAP 每股收益。

Now let me give you some additional numbers for your models. GAAP operating expenses for the second quarter of 2021 was $357.9 million. Non-GAAP operating expenses were $314.2 million, a decline of $10.5 million quarter-over-quarter as we continue to see the favorable impact of our cost reduction initiatives launched in Q1. Our GAAP operating margin in the second quarter was 16.9% as compared to 3.6% in the second quarter of 2020. Our non-GAAP operating margin was at the highest level since 2010, coming in at 19.6% as compared to 7.4% in the second quarter of 2020 and 13.3% in Q1. Our GAAP diluted share count was 443.6 million shares, and our non-GAAP diluted share count was 435 million shares. Please note, we have included an updated reference table on the Investor Relations section of our website to assist you with calculating our diluted share count at various share prices.

現在讓我為您的模型提供一些額外的數字。2021 年第二季的 GAAP 營運費用為 3.579 億美元。非公認會計準則營業費用為 3.142 億美元，環比下降 1050 萬美元，這得益於我們繼續看到第一季推出的成本削減舉措帶來的有利影響。我們第二季的 GAAP 營業利潤率為 16.9%，而 2020 年第二季為 3.6%。我們的非公認會計準則營業利潤率達到了 2010 年以來的最高水平，達到 19.6%，而 2020 年第二季為 7.4%，第一季為 13.3%。我們的 GAAP 稀釋股數為 4.436 億股，非 GAAP 稀釋股數為 4.35 億股。請注意，我們在網站的投資者關係部分添加了更新的參考表，以幫助您計算不同股價下的稀釋股數。

So turning to the balance sheet. Cash and cash equivalents was $1.09 million, and we had -- sorry, $1.09 billion, and we had $1.97 billion undrawn on our revolver. Cash from operations was $488 million, and free cash flow was $383 million or 23% of revenue. Capital expenditures during the quarter of 2021 was $104.8 million, which equates to a capital intensity of 6.3%. As we indicated previously, we are directing a significant portion of our capital expenditures towards enabling our 300-millimeter capabilities at our East Fishkill fab.

因此轉向資產負債表。現金和現金等價物為 109 萬美元，而我們有 — — 抱歉，是 10.9 億美元，而且我們還有 19.7 億美元未動用循環信貸資金。經營現金流為 4.88 億美元，自由現金流為 3.83 億美元，佔收入的 23%。2021 年季度的資本支出為 1.048 億美元，相當於資本密集度 6.3%。正如我們之前所指出的，我們將把很大一部分資本支出用於實現 East Fishkill 晶圓廠的 300 毫米產能。

Accounts receivable was $669 million, resulting in DSO of 37 days. Inventory increased $13.8 million sequentially to $1.31 billion, and days of inventory decreased 8 days to 116 days. Distribution weeks of inventory decreased again by $42.6 million to 7.3 weeks from 8.4 weeks in Q1, which is below our target range of 11 to 13 weeks. Once again, we are proactively reducing the distribution inventory to hold more inventory on our balance sheet to support our customer needs rather than building inventory in the supply chain. Total debt was $3.3 billion, and we paid down $120 million in the quarter.

應收帳款為 6.69 億美元，導致 DSO 為 37 天。庫存較上月增加 1,380 萬美元至 13.1 億美元，庫存天數減少 8 天至 116 天。庫存分銷週數再次減少了 4,260 萬美元，從第一季的 8.4 週降至 7.3 週，低於我們 11 至 13 週的目標範圍。再次，我們積極減少分銷庫存，以便在資產負債表上持有更多庫存來滿足客戶需求，而不是在供應鏈中建立庫存。總債務為 33 億美元，我們本季償還了 1.2 億美元。

So turning to guidance for the third quarter. A table detailing our GAAP and non-GAAP guidance is provided in the press release related to our second quarter results. Let me now provide you with the key elements of our non-GAAP guidance for the third quarter. As mentioned, we believe demand will remain strong for the remainder of the year. Although we continue to increase our supply through operational efficiencies, we'll be limited by supply constraints and are working with our strategic customers to provide long-term support.

因此轉向第三季的指引。在與我們第二季業績相關的新聞稿中，提供了詳細介紹我們的 GAAP 和非 GAAP 指引的表格。現在，讓我向您提供我們第三季非 GAAP 指引的關鍵要素。如上所述，我們相信今年剩餘時間內需求仍將保持強勁。儘管我們透過提高營運效率不斷增加供應，但我們會受到供應限制的限制，並正在與我們的策略客戶合作提供長期支援。

Based on current bookings trends, backlog levels, we anticipate the revenue for the third quarter will be in the range of $1.66 billion to $1.76 billion. We expect gross margin between 39% to 41%, and this includes share-based compensation of $3.7 million. We expect non-GAAP operating expenses of $305 million to $320 million, and this includes share-based compensation of $19.2 million. We anticipate our non-GAAP OIE including interest expense will be $26 million to $29 million. So this results in non-GAAP earnings per share in the range of $0.68 to $0.80. We expect capital expenditures of $100 million to $110 million in the third quarter of 2021, and our non-GAAP diluted share count is expected to be in the range of 436 million shares.

根據目前的預訂趨勢和積壓訂單水平，我們預計第三季的營收將在 16.6 億美元至 17.6 億美元之間。我們預計毛利率在 39% 至 41% 之間，其中包括 370 萬美元的股權激勵費用。我們預計非公認會計準則營業費用為 3.05 億美元至 3.2 億美元，其中包括 1,920 萬美元的股權激勵費用。我們預計，包括利息支出在內的非公認會計準則 OIE 將達到 2,600 萬至 2,900 萬美元。因此非 GAAP 每股盈餘將在 0.68 美元至 0.80 美元之間。我們預計 2021 年第三季的資本支出為 1 億至 1.1 億美元，我們的非 GAAP 稀釋股數預計在 4.36 億股左右。

So in summary, I'm extremely pleased with our early progress and the execution of our transformation initiatives. I add my thanks to our worldwide teams for their hard work and unwavering commitment to our customers, and I look forward to seeing you all at our Analyst Day in New York in a few days.

總而言之，我對我們的早期進展和轉型計劃的執行感到非常滿意。我還要對我們全球團隊的辛勤工作和對客戶的堅定承諾表示感謝，並期待幾天後在紐約的分析師日上見到大家。

With that, I'll turn the call back over to the operator to open the line for Q&A.

說完這些，我將把電話轉回給接線生，開通問答專線。

(Operator Instructions) Your first question comes from Ross Seymore from Deutsche Bank.

（操作員指示）您的第一個問題來自德意志銀行的羅斯·西摩（Ross Seymore）。

Congrats on the results. Hassane, I want to talk a little bit about the demand and the shortage commentary you had. I believe last quarter, you thought that the demand would kind of stabilize, the velocity might -- of the increase might slow, but shortages would abate in the second half of the year. It seems like you've pushed that out into the first half of next year. So I guess what's changed with any color on the demand side? And how can you be confident that there's no double ordering within that?

恭喜你所取得的成果。哈桑，我想稍微談談你對需求和短缺的評論。我相信上個季度您認為需求會趨於穩定，成長速度可能會放緩，但下半年短缺情況會減輕。看起來你已經將其推遲到明年上半年了。所以我猜需求方面的顏色有什麼變化嗎？那麼你怎麼能確信其中沒有重複排序呢？

Sure. That's a good question. Look, the demand environment, as we've always stated, is very dynamic. We see it basically pushing out into the first half of next year. That's based on our backlog based on customer interactions and really based on the LTSAs that we have been engaging with on customers, either signed or in active engagement. Now as far as the double ordering, we're managing our supply chain to make sure that doesn't happen as far as having it in the channel. So we have been reducing and managing inventory very closely. That keeps the inventory on our balance sheet but allows us to service strategic customers as we see the demand from the end customer without really accounting for any, call it, buffer stocking that you may or may not see in the distribution channel or anywhere in between us and OEM. So that's how we're managing, call it, tactical, but that's what we need to do right now to make sure that we're not going to suffer from the double ordering. So that gives me the confidence, given the numbers of the inventory that have been reducing and building up on our balance sheet, that we are literally tackling end demand on a one-to-one basis with our direct customers.

當然。這是個好問題。正如我們一直所說，需求環境是非常動態的。我們認為這項進程基本上將延續到明年上半年。這是基於我們與客戶互動的積壓工作，也實際上是基於我們與客戶接觸的 LTSA（無論是已簽署的還是積極參與的）。現在就重複訂購而言，我們正在管理我們的供應鏈，以確保這種情況不會在管道中發生。因此，我們一直在減少並嚴格管理庫存。這樣可以將庫存保留在我們的資產負債表上，但使我們能夠根據最終客戶的需求為戰略客戶提供服務，而無需真正考慮您可能在分銷渠道中或我們與 OEM 之間的任何地方看到的緩衝庫存。這就是我們的管理方式，可以稱之為戰術，但這也是我們現在需要做的，以確保我們不會遭受雙重訂購的困擾。因此，考慮到我們資產負債表上庫存數量一直在減少和增加，這讓我有信心，我們實際上是在與直接客戶一對一地解決最終需求。

I guess as my follow-up for either you or Thad on the gross margin side of things, that's probably the most impressive line given where ON has been historically and the challenges it's faced. Can you just talk a little bit about what drove the upside even to your guidance in the second quarter, similarly for the third quarter? And a higher-level question, how much of that do you believe is structural versus just you guys benefiting from some pretty strong cyclical tailwinds that, as we've learned in the past, can come and go at different times?

我想，作為對您或 Thad 在毛利率方面的跟進，考慮到 ON 的歷史地位和麵臨的挑戰，這可能是最令人印象深刻的一句話。您能否稍微談談是什麼推動了第二季的業績預期上漲，第三季的業績預期也同樣上漲？更高層次的問題是，您認為其中有多少是結構性的，而僅僅得益於一些相當強勁的周期性順風，正如我們過去了解到的，這些順風可以在不同的時間出現和消失？

Yes. I mean if you look at the components of the gross margin strength, obviously, we've always said in the first and second quarter now, we have, call it, thousands of line items that we are structurally working on improving our operation and streamlining our business that's going to drive gross margin expansion. Those have been firing on all cylinders, and we are seeing the benefit incrementally and you're going to see that in our guide for Q3. So those, I would call structural.

是的。我的意思是，如果你看一下毛利率實力的組成部分，顯然，我們一直在說，在第一季度和第二季度，我們有數千個項目，我們正在結構性地努力改善我們的營運和精簡我們的業務，這將推動毛利率的擴大。這些都已全速運轉，我們正在逐步看到其效益，您將在我們的第三季指南中看到這一點。所以我將這些稱為結構性的。

If you look at utilization. Utilization has been flat from last quarter, but you see a big gross margin jump. That also is what I would call structural. It's not really tied to utilization per se because utilization is flat. So the jump from Q1 to Q2 is on all the other work that we have been doing. So we continue to streamline our operation, take cost out of our products and portfolio mix and portfolio rationalization. A couple of quarters ago, I was asked if that would be delayed because of the demand environment. My commentary has been it's actually going to be accelerated because it's going to force us to shift faster to our strategic products that will drive higher margin. So you're seeing some of that portfolio mix happening earlier than we anticipated. So all of these components will tell you that it is structural, it is sustainable and forward-looking, I'm very bullish on the capability of our gross margin expansion.

如果你看一下利用率。利用率與上一季持平，但毛利率大幅上升。這也是我所說的結構性的。它實際上與利用率本身並無關聯，因為利用率是持平的。因此，從 Q1 到 Q2 的跳躍與我們一直在做的所有其他工作有關。因此，我們繼續精簡我們的運營，降低產品和投資組合的成本並實現投資組合合理化。幾個季度前，有人問我這是否會因為需求環境而被推遲。我的評論是，它實際上將會加速，因為它將迫使我們更快地轉向策略性產品，從而提高利潤率。因此，您會看到部分投資組合的出現比我們預期的要早。因此，所有這些組成部分都會告訴你，它是結構性的、可持續的和前瞻性的，我對我們的毛利率擴張能力非常看好。

Yes. I would just -- I think you nailed it there, Hassane. I think if you look at the upside compared to our guidance, we were able to get more supply out of our manufacturing sites and then, obviously, we're getting favorable mix out of that as well, which is helping with the gross margin. But absolutely agree, it's structural changes that we're making inside the company.

是的。我只是 — — 我認為你說對了，哈桑。我認為，如果與我們的預期相比，我們的優勢在於，我們能夠從製造基地獲得更多的供應，而且顯然我們也從中獲得了有利的組合，這有助於提高毛利率。但絕對同意，這是我們在公司內部進行的結構性變革。

Your next question comes from Charles Danely from Citi Group.

您的下一個問題來自花旗集團的 Charles Danely。

I think you got the wrong name, but I'll speak up for my unborn son named Charles. It's Chris. Can you just be a little more specific on the gross margin drivers? Was there any pricing involved? Are you cutting specific product lines? It's just a big jump given that utilization rates didn't do anything. Any specifics there would be great.

我覺得你叫錯了名字，但我會為我未出生的兒子查爾斯說話。是克里斯。您能否更具體地說明毛利率驅動因素？是否涉及任何定價？您是否正在削減特定的產品線？鑑於利用率沒有起到任何作用，這只是一個巨大的飛躍。如有任何具體資訊就更好了。

Yes. I mean it's spread across the board. Of course, there is some what I referred to price to value discrepancy. So we have been looking at our pricing from a strategic perspective. What products and what pricing they need to be in the market to extract the value that we provide for our customers. Cost is a big factor, not just product cost, but supply chain costs, upstream and downstream supply chain costs. Some of the increases that we've seen, we've passed those on to customers, as I've described in prior calls. So it's really -- Chris, it's across the board. There's not a big step function that I would anchor on because when we look at incrementally, it came from all of these swim lanes that we have been launched and working on since -- really since the December time frame when I came in, I said we're structuring gross margin. I have a specific owner in the company that drives gross margin improvements for the company. And we have about, call it, 1,000 swim lanes that we are delivering to. And those are starting to come out now because it takes time to get those through the supply chain and now is the quarter where we see it. And they're going to continue in the forward-looking quarters as well given the Q3 guidance range.

是的。我的意思是它已經遍布各處。當然，我提到的價格和價值存在一些差異。因此，我們一直從策略角度看待我們的定價。我們需要在市場上推出什麼樣的產品、以什麼樣的價格為客戶提供價值。成本是一個很大的因素，不只是產品成本，還有供應鏈成本，上下游供應鏈成本。正如我在之前的電話中所描述的那樣，我們已經將看到的一些成長轉嫁給了客戶。所以這真的是—克里斯，這是全面的。我沒有固定一個大的階梯函數，因為當我們從增量的角度來看時，它來自於我們已經啟動和致力於的所有這些泳道——實際上自從我去年 12 月加入以來，我就說過我們正在構建毛利率。我在公司有一位特定的負責人，負責推動公司毛利率的提高。我們正在為大約 1,000 條泳道提供服務。這些現在開始顯現出來，因為將它們通過供應鏈需要時間，而現在是我們看到它的季度。鑑於第三季的指導範圍，他們也將繼續在前瞻性季度中這樣做。

Great. And then for my follow-up, you mentioned you expect the shortages to extend into next year. Can you just talk about where your lead times are these days or what they did sequentially? Did they extend during the quarter? Were they flat, up or down?

偉大的。然後，在我的後續問題中，您提到預計短缺將持續到明年。你能不能談談你們最近的交貨時間或他們的連續交貨時間是怎樣的？他們在本季延長了任期嗎？它們是持平、上漲還是下跌？

Yes, Chris, the last quarter, our lead times were in the low 30-week range. We're now up to about 42 weeks. So they've gone out by about 10 weeks sequentially. Obviously, we're working on that, but that's another reason that is giving us -- on one hand, giving us more visibility, but why we see the supply constraints being limited as we look forward.

是的，克里斯，上個季度，我們的交貨時間在 30 週左右。現在我們已經有大約 42 週了。因此他們已經連續出去了大約 10 週。顯然，我們正在努力做到這一點，但這是另一個原因，一方面，它為我們提供了更多的可見性，但另一方面，我們看到供應限制在有限的範圍內。

Your next question comes from Vivek Arya from Bank of America.

您的下一個問題來自美國銀行的 Vivek Arya。

Congratulations on the gross margin and especially the free cash flow improvement. My first question, Hassane, is that investors are trying to grapple with the situation where, as you mentioned, demand is strong, but will the supply environment stay disciplined. So the specific question is, how undersupplied is the industry right now? And you mentioned the situation could persist until the first half. Is that based on demand levels staying at current levels or what they could be next year? Just basically, what are your views about the supply response from ON and your peer group to give investors the comfort that the supply response from the industry is not going to change this very strong discipline and the pricing dynamic that your industry is benefiting from right now?

恭喜毛利率和自由現金流的改善。我的第一個問題是，哈桑，投資者正在努力應對這種情況：正如您所說，需求強勁，但供應環境是否會保持自律。那麼具體問題是，目前該產業的供應短缺程度如何？您剛才提到這種情況可能會持續到上半場。這是基於需求水準維持在目前水準還是明年的水準？基本上，您對 ON 和同行的供應反應有何看法，能否讓投資者放心，行業的供應反應不會改變這種非常嚴格的紀律和您的行業目前受益的定價動態？

Yes. That's a good question. I can really speak for ON and what we're doing here. Of course, the fear is the reaction you go and build capacity for across the board. But if you look at what we are doing specifically and why I'm comfortable with the forward-looking view of our margin and our posture really with the gross margin expansion is we are selectively adding capacity where we see the growth in our strategic products forward-looking. So we're not adding capacity for the sake of adding capacity. We are first shifting from a lot of what we call the legacy portfolio into the strategic growth and adding capacity there. So as we are increasing our top line, given the supply relief that we're getting through our supply chain, those are coming from strategic growth products. So when I look at our strategic plans moving forward, and we'll give a little bit more color at Analyst Day, that's where we're expanding the capacity. It is not equal for all. So there are demand signals on our -- and our visibility on our customers that we are not servicing beyond what we can today. So I'm not adding capacity there. We're selective. We're very disciplined on where we add capacity, and we're adding it in our growth product that are strategic, and those will be driving the gross margin forward-looking. So very selective, not a shotgun approach.

是的。這是個好問題。我確實可以代表 ON 談論我們在這裡所做的事情。當然，擔心的是你會做出反應並全面建立能力。但如果你看看我們具體在做什麼，以及為什麼我對我們的利潤率的前瞻性觀點感到滿意，以及我們的毛利率擴張的真正態勢，我們正在有選擇地增加產能，我們看到我們的戰略產品的前瞻性增長。因此，我們不會為了增加產能而增加產能。我們首先從大量所謂的傳統投資組合轉向策略性成長並增加產能。因此，隨著我們的營業收入不斷增加，考慮到我們透過供應鏈獲得的供應緩解，這些收入都來自策略性成長產品。因此，當我審視我們未來的策略計畫時，我們會在分析師日提供更多細節，這就是我們擴大產能的地方。並不是所有人都能得到平等的待遇。因此，我們有需求訊號——而且我們的客戶也清楚，我們提供的服務並未超出我們目前的能力範圍。所以我不會在那裡增加容量。我們很有選擇性。我們對增加產能的地方非常嚴格，並將其添加到具有戰略意義的成長產品中，這些將推動毛利率的前瞻性。所以要非常有選擇性，而不是散彈槍式的方法。

Got it. And for my follow-up, actually, a clarification and a question. On the clarification side, any impact from shutdowns or COVID-related issues in Southeast Asia from a supply side? And then, Hassane, you sound really very confident about ON's prospects in the electrification side. So could you help us understand what is your current exposure to EVs? And what kind of content growth do you see both on the powertrain and the ADAS side as the industry moves more towards EVs?

知道了。實際上，對於我的後續問題，我要澄清一下並提出一個問題。澄清一下，從供應方面來看，東南亞的停工或新冠疫情相關問題是否產生了影響？然後，哈桑，你聽起來對 ON 在電氣化方面的前景非常有信心。那麼您能幫助我們了解您目前對電動車的了解程度嗎？隨著產業逐漸轉向電動車，您認為動力系統和 ADAS 的內容將有什麼樣的成長？

So let me answer the EV first. Our exposure, obviously, this is starting to grow. I'm very bullish. I'm not going to -- I can't even hide it. So I'm glad you really picked it up. So I'm very bullish with our posture, both on automotive safety and electrification. Electrification penetration is starting to pick up. We're well positioned with strategic OEMs directly, but also through their Tier 1 supply chain. So that is really forward-looking how I look at the market and really where our R&D investments are happening. If you recall, we did a big restructure at the beginning of the year. That's moving R&D and capacity and capital into those markets, because I see the design wins, I have personally engaged with customers. We have LTSH as it relates to vehicle electrification. All of these make me very bullish, but more importantly, very excited on the potential of ON in these markets.

因此，讓我先回答 EV。顯然，我們的曝光度開始成長。我非常樂觀。我不會——我什至無法隱藏它。所以我很高興你真的學會了。因此，我對我們的立場非常樂觀，無論是在汽車安全和電氣化方面。電氣化滲透率開始回升。我們不僅直接與策略 OEM 建立聯繫，還透過他們的一級供應鏈建立聯繫。所以我對市場以及我們研發投資的真正方向的看法確實很有前瞻性。如果你還記得的話，我們在今年年初進行了一次大規模重組。這就是將研發、產能和資本轉移到這些市場，因為我看到了設計的成功，我已經親自與客戶接觸了。我們有與車輛電氣化相關的 LTSH。所有這些都讓我非常樂觀，但更重要的是，我對 ON 在這些市場中的潛力感到非常興奮。

For your question about the COVID disruption, yes, we have seen disruption related to COVID in some of our supply chain, direct or indirect. But back to the demand environment, I thank our operations and our manufacturing teams worldwide, we were able to really redirect and service more demand by shifting the mix again. So there was disruption, we overcome that disruption and now we're back on track. So let's call it a blip that we were able to sustain given the demand and given the work that we're doing on releasing more capacity.

對於您關於新冠疫​​情中斷的問題，是的，我們的部分供應鏈中確實出現了與新冠疫情相關的直接或間接中斷。但回到需求環境，我感謝我們全球的營運和製造團隊，我們能夠透過再次改變組合來真正重新定向和滿足更多需求。因此，出現了混亂，我們克服了混亂，現在我們又回到了正軌。因此，我們可以稱之為我們能夠維持的一個小高峰，因為有需求，而且我們為釋放更多產能而進行的工作。

Your next question comes from Toshiya Hari from Goldman Sachs.

您的下一個問題來自高盛的Toshiya Hari。

Congrats on the strong results. Hassane, I had a 2-part question on gross margin. You talked about addressing price-to-value discrepancies. Just curious what percentage of the discrepancies have you been able to execute on in the form of price increases? And how much left is there to go? Guessing your tenure at ON, I'm guessing it's still very early innings, but curious how much is left. And then as my second part, in terms of the 300-millimeter transition, again, I believe it's very early in the process, but how do you see that evolving over the next couple of years and the impact on gross margins?

恭喜您取得的優異成績。Hassane，我有兩個關於毛利率的問題。您談到了解決價格與價值差異的問題。只是好奇您能夠以提高價格的形式解決多少比例的差異？還有多少路要走？猜測您在 ON 的任期，我​​猜現在還處於非常早期的階段，但好奇還剩下多少時間。然後作為我的第二部分，關於 300 毫米轉型，我再次認為現在還處於過程的早期階段，但您認為未來幾年它將如何發展以及對毛利率的影響如何？

Sure. So the first question as it relates to price-to-value, obviously, this is an ongoing effort. I would put it under the portfolio rationalization overall. So I don't break it out because of price or because of the shift because all of those are material. If you start moving the shift to high-value products, without touching the price, that's going to impact the value you provide to customers. So I would say, like you mentioned, we're not done yet. That's a continuous improvement. Everywhere we look, there is opportunity. And more importantly, it's the momentum that the company is getting. If you think about it, the first couple of quarters, I've been pushing a lot of that from the top. Right now, it's part of our culture. It's part of how the teams are thinking about pricing strategies from new products and moving forward. So it's not a blip in time where, because of that environment, we're able to extract the value. It is structurally how we're moving forward. So new products are not going to be having those issues of the price-to-value discrepancies because we are pricing the new products and delivering the new products exactly at the value they provide customers. So that's really how I look at it. Does that help?

當然。因此第一個問題與價格價值有關，顯然，這是一個持續的努力。我會把它納入整體投資組合合理化之中。因此，我不會因為價格或轉變而將其分開，因為所有這些都是重要的。如果您開始轉向高價值產品，而不改變價格，這將影響您向客戶提供的價值。所以我想說，就像你提到的那樣，我們還沒有完成。這是一個持續的改進。放眼望去，到處都有機遇。更重要的是，這是公司正在獲得的發展動能。如果你仔細想想，前幾個季度，我已經從頂層推動了很多事情。現在，它是我們文化的一部分。這是團隊思考新產品和未來定價策略的一部分。因此，這並不是短暫的現象，因為在那樣的環境下，我們才能夠提取價值。從結構上來說，這就是我們前進的方式。因此，新產品不會出現價格與價值差異的問題，因為我們對新產品的定價和交付都完全按照其為客戶提供的價值來進行。這就是我的看法。這樣有幫助嗎？

It does. And then the 300-millimeter transition? And sorry, as my follow-up, just on the OpEx side of things, I think you came in below the low end of your range for Q2, roughly 19% of sales. And then for Q3, your guidance implies an OpEx-to-sales ratio of around 18%. That compares with the prior management team's long-term target of 21%. So just curious, is 18% sort of the new normal? Is it going to be a little bit higher, a little bit lower? Any thoughts on OpEx going forward would be helpful as well.

是的。然後是 300 毫米的過渡？抱歉，作為我的後續問題，僅就營運支出方面而言，我認為您第二季的營運支出低於範圍的低端，約佔銷售額的 19%。對於第三季度，您的指導意味著營運支出與銷售額的比率約為 18%。相比之下，前任管理團隊的長期目標為 21%。我只是好奇，18% 是新常態嗎？它會稍微高一點還是低一點？對於未來 OpEx 的任何想法也將有所幫助。

Sure. So on the 300-millimeter, obviously, it's a strategic asset. We have been working with GLOBALFOUNDRY on our transition. We have not taken ownership of that fab yet. However, we're working very closely on starting to move volume into that fab. So when we take ownership, we hit the ground running. And that, of course, is going to be supportive of our gross margin efforts from a product cost perspective. Where we are there, we're on track. I review this regularly as far as how many products have we qualified in the 300-millimeter fab. But more importantly, the customers that have qualified that fab for us to be able to ramp with them over '22 and into '23. So that's all on track. I'm happy with the progress. So that asset is going to be favorable for us in the long run, both from a capacity but also from a cost structure. And I'll let Thad comment on the OpEx.

當然。因此，300毫米顯然是一種戰略資產。我們一直在與 GLOBALFOUNDRY 合作實現我們的轉型。我們尚未取得該晶圓廠的所有權。然而，我們正在密切合作，開始將產量轉移到該晶圓廠。因此，當我們承擔起責任時，我們就會立即開始行動。當然，從產品成本的角度來看，這將有利於我們提高毛利率。我們現在的位置，正走在正確的軌道上。我會定期檢查我們在 300 毫米晶圓廠中有多少產品已達到合格標準。但更重要的是，客戶已經認可了該工廠，使我們能夠在2022年和2023年與他們一起擴大產能。一切進展順利。我對這項進展很滿意。因此，從長遠來看，這項資產對我們來說是有利的，無論從產能或成本結構來看。我將讓泰德 (Thad) 對 OpEx 進行評論。

Yes. On the OpEx side of things, to remind you, in Q1, we did a restructuring activity, and we said we'd realize the benefit of that cost savings over the course of the year. We accelerated that, and we're able to recognize some of that earlier, and that's the impact that you're seeing here in Q2 that's more favorable to our guidance. We still believe we're going to exit the year somewhere just north of $300 million on a quarterly run rate and that becomes the new baseline. Obviously, you've got the reset of FICA and things like that going into next year. But that becomes kind of a run rate that we think we maintain. And then obviously, as we grow, we'll add OpEx back at a much slower pace than our revenue growth.

是的。在營運支出方面，提醒您，在第一季度，我們進行了重組活動，並表示我們將在一年內實現成本節約的好處。我們加速了這一進程，並且能夠更早地認識到其中的一些問題，這就是您在第二季度看到的影響，對我們的指導更有利。我們仍然相信，今年年底我們的季度營業額將略高於 3 億美元，這將成為新的基準。顯然，聯邦保險捐款法 (FICA) 及類似事宜將於明年重新設定。但我們認為這將成為一種可以維持的運作率。顯然，隨著我們的發展，我們增加營運支出的速度會比收入成長的速度慢得多。

Your next question comes from Harsh Kumar from Piper Sandler.

您的下一個問題來自 Piper Sandler 的 Harsh Kumar。

First of all, strong congratulations. These are stunning results. Hassane, I'm going to push you a little bit. In the last 5 years of results, I think the peak happened at $1.5 billion, a 38.5% gross margin. I think it was like 2018 or something like that. You're now talking almost $1.7 billion, 40%. So my question is, you've got a higher run rate, higher margins. How much is it a function of the actions that you've done and the actions that you've implemented in your opinion? And I've got a follow-up.

首先，熱烈祝賀。這些結果是驚人的。哈桑，我要稍微推你一下。在過去 5 年的業績中，我認為高峰出現在 15 億美元，毛利率為 38.5%。我認為那就像 2018 年或類似的年份。你現在談論的是近 17 億美元，40%。所以我的問題是，你的運行率更高，利潤率也更高。您認為它在多大程度上取決於您所做的行為和您實施的行動？我還有後續行動。

Sure. Of course, there's only one answer to that. It's all based on the stuff that we've been working on. But let me talk about the timing of it. Of course, the demand environment has helped accelerate a lot of these, as I talked about before. We've always had part of our structural or restructuring plan to start shifting portfolio and shifting that mix to high-value, high-margin, high-strategic products in our target markets of auto and industrial. That is part of the actions that we have been taking and we started taking since I joined. They got accelerated with the demand environment. Because of the capacity constraints, what we've done is we've released capacity from what I would call the legacy commodity products that we've always wanted to move away from part of my strategy faster into putting that capacity on high-value, high-growth and strategic products that will grow with us over the next 5 to 10 years. So the actions are all there. The timing was accelerated and helped by the current environment.

當然。當然，這個問題只有一個答案。這一切都基於我們一直在研究的內容。但讓我來談談它的時間安排。當然，正如我之前談到的，需求環境有助於加速其中許多進程。我們的結構或重組計畫中一直有一部分是開始轉變投資組合，並將該組合轉向汽車和工業目標市場的高價值、高利潤、高策略產品。這是我們一直在採取的行動的一部分，自從我加入以來我們就開始採取行動。他們隨著需求環境而加速發展。由於產能限制，我們所做的是釋放傳統商品的產能，我們一直希望將其從我的策略中更快地轉移，將產能投入到將在未來5到10年內與我們一起成長的高價值、高成長和策略性產品上。所以所有動作都在那裡。當前環境加快並有助於這一進程。

I got you ...

我接到你了 ...

Does that answer you question, Harsh?

這回答了你的問題了嗎，哈什？

Yes, it does and very helpful. And then on -- following up on Toshiya's question, I wanted to talk fabs and cost cuts. So can you remind us the timing of when you will actually have products running through Fishkill? Because that could be -- it could be a great benefit, also great cost if things don't go well and you're running the fab sort of empty. So when will you be able to point when it's sort of utilized well from a timing angle? And then with that big 12-inch fab coming your way, how many fabs do you think you'll eventually need?

是的，它確實很有幫助。然後 - 接下來是Toshiya的問題，我想談談晶圓廠和成本削減。那麼，您能否提醒我們一下你們的產品實際透過菲什基爾運送的具體時間？因為那可能是——如果事情進展不順利並且你的工廠處於空轉狀態，那麼那也可能是一個巨大的好處，但同時也會帶來巨大的成本。那麼從時間角度來說您何時能夠指出何時它能夠得到很好的利用？那麼隨著大型 12 吋晶圓廠的出現，您認為最終需要多少個晶圓廠？

Yes. So let me talk about East Fishkill first. We are running revenue and running volume today at East Fishkill. Remember, it's a shared fab today with us and GLOBALFOUNDRY. We have capacity or allocation part of that capacity out of the fab and GLOBALFOUNDRY has their capacity part of our original agreement. We are already shipping qualified products to end customers that are generating revenue out of that fab. That revenue will keep increasing through '22, as I mentioned, and we're on track based on customer quals and our own product quals. So that progression is there. And obviously, we will be talking about utilization once we take ownership of that fab in '23 and through '24. But right now, it's more of an allocation because the fab is still not owned by ON. But I measure, in this case, are we shipping what we need to be shipping to our customers based on the quals because that's really the latency that you usually get, and we're on track with that. As far as how many fabs we need to run our operations, obviously, that's not something I can comment on today. My focus is really on rationalizing our manufacturing footprint to going to a fab lighter. So we will have less fabs, but I will be ready to comment more on it as we're ready, and we have communicated plans to that specifically.

是的。那我先來談談東菲什基爾。今天，我們正在東菲什基爾計算收入和收入總量。請記住，今天我們和 GLOBALFOUNDRY 共享一個晶圓廠。我們在晶圓廠擁有產能或分配了部分產能，而GLOBALFOUNDRY 也擁有我們原始協議中的產能部分。我們已開始向透過該工廠創造收入的最終客戶運送合格產品。正如我所提到的那樣，到22年，該收入將繼續增加，並且根據客戶品質和我們自己的產品質量，我們正在按計劃進行。因此，這種進展是存在的。顯然，一旦我們在23年和24年接管該晶圓廠，我們將討論利用率。但目前，這更像是一種分配，因為該晶圓廠仍不屬於安森美半導體。但在這種情況下，我會衡量我們是否根據品質向客戶發送了我們需要發送的內容，因為這實際上是您通常會遇到的延遲，而且我們正在按計劃進行。至於我們需要多少個晶圓廠來維持運營，顯然我今天無法發表評論。我的重點實際上是如何合理化我們的製造足跡，以減輕工廠的負擔。因此，我們的晶圓廠數量將會減少，但當我們做好準備時，我會對此發表更多評論，而且我們已經具體傳達了有關計劃。

Your next question comes from Mark Lipacis from Jefferies.

您的下一個問題來自 Jefferies 的 Mark Lipacis。

First question, sorry to come back to the gross margins, but it sounds like there's something really different going on with ON in the last 10 or 15 years. So Thad, in your script, I think when you talked about the gross margin upside, you said mix efficiency, execution and cost containment. I don't think I heard pricing in there. And then, Hassane, you used the expression price-to-value discrepancy, which I thought was a code word for we took prices up, but it sounds like it's -- you're shifting the mix on your limited capacity to the higher-value products. So -- and so the question is on the last -- so I guess there's a clarification. I just want to make sure I got that right. And for me, the question is over the last 10, 15 years, I covered ON when things are bad, you hear about 6% to 10% price pressure. And then when things are good, you hear about 5% to 10% price improvements. Is that part of your business gone? Is this -- Is ON now a much lower volatility business on the -- much less subject to pricing pressure? And then I had a follow-up.

第一個問題，很抱歉又回到毛利率的話題上，但聽起來安森美蘭在過去 10 到 15 年裡確實發生了一些不同的事情。所以 Thad，我認為，在您的腳本中，當您談到毛利率上升時，您提到了混合效率、執行和成本控制。我認為我沒有聽到那裡的定價。然後，哈桑，你使用了價格與價值差異的表達，我認為這是我們提高價格的暗號，但聽起來像是——你正在將有限產能的組合轉移到更高價值的產品上。所以 — — 問題在於最後一個 — — 所以我想有一個澄清。我只是想確保我理解正確。對我來說，問題是，在過去的 10 到 15 年裡，當情況不好時，我聽到的價格壓力約為 6% 到 10%。當情況好轉時，您會聽到價格上漲 5% 到 10%。你那部分的業務消失了嗎？這是 — ON 現在的波動性是否低得多 — — 受定價壓力的影響是否小得多？然後我進行了後續行動。

So the short answer is yes. Strategically, if you -- I think one of -- it was the first conference that I attended back in January, the CES Conference, where I really put my focus on gross margin improvement through manufacturing footprint rationalization and product portfolio rationalization. Those are 2 strategic directions that I have set as far as what we need to do right now. So what does portfolio rationalization mean in the terms that you described, which are very accurate? One is, look at which products are we going to grow in and which products are legacy where we're not going to be investing in and start shifting that to the high-strategic products where we want to play. Now that's more forward-looking, meaning it is not a point in time where those products are now better mix. And when the market goes the other way, we're going to have to see what you said, the 6%. What we are seeing is we are shifting that to the strategic products that are starting even to grow and will maintain growth over the next 5 to 10 years. That's the structural portfolio mix that we have done.

簡短的回答是肯定的。從策略上講，如果你——我認為其中之一——那是我 1 月參加的第一次會議，即 CES 會議，我真正把重點放在透過製造足跡合理化和產品組合合理化來提高毛利率上。這是我為目前需要做的事情設定的兩個策略方向。那麼，您所描述的投資組合合理化究竟意味著什麼呢？它非常準確嗎？一是，看看哪些產品我們會成長，哪些產品是我們不會投資的傳統產品，然後開始轉向我們想要發揮的高策略產品。現在，這更具前瞻性，這意味著這些產品不再是現在更好混合的時間點。當市場朝另一個方向發展時，我們必須看到你所說的 6%。我們看到的是，我們正在將其轉向開始成長並將在未來5到10年保持成長的策略產品。這就是我們所做的結構性投資組合。

So what's different from the last 15 years is I don't need fab fillers. When you have fab filler products, which are low-value, discrete commoditized products, you steep shoving them in the fab and they go up and down with the market. We're moving away from that. We are moving to strategic high-value products that are going to grow over time, and that capacity has been taken away from the discrete commodity product that caused that volatility. So in summary, when you shift your mix to strategic growth products, that volatility disappears because that's a growth trajectory and a growth trajectory only whatever demand does, it's going to be growth. Maybe it's not high growth, but it's still growth. That's the structural impact of the portfolio rationalization. I'm ready for your follow-up.

與過去 15 年不同的是，我不再需要填充劑了。當您擁有晶圓廠填充產品（即低價值、離散的商品化產品）時，您會將它們猛推到晶圓廠，它們的價格會隨著市場的變化而漲跌。我們正在遠離這一現狀。我們正在轉向隨著時間的推移而成長的策略性高價值產品，而該產能已從造成波動的離散商品產品中剝離出來。總而言之，當你將產品組合轉向策略性成長產品時，波動性就會消失，因為這是一種成長軌跡，而成長軌跡就是無論需求如何，它都會成長。雖然這可能不算是高速成長，但仍然是成長。這就是投資組合合理化的結構性影響。我已準備好接受你的跟進。

Yes, great. That's really helpful. The -- what are you looking at ON for leading indicators to tell you that customers are getting over their skis on their orders? And maybe can you talk about any dynamics you're seeing on any cancellations or pushouts or anything like that?

是的，太棒了。這真的很有幫助。您正在查看哪些領先指標來告訴您客戶是否已經超出訂單要求了？也許您可以談談您所看到的取消或推遲或類似情況的動態？

Yes. Look, there are many signs that we look at. I have analytics to be able to see. Obviously, you're not always going to see 100% around the corner. But I'm comfortable with the visibility we get. Both Thad and I review it more than once a week in order to make sure we don't miss anything. But not to be joking about it, but the biggest gauge is how many escalation calls I get from customers is the biggest indicator. When I -- when my phone start ringing, it stops ringing off the hook 50 times a day, then I know we're not where we are today. So both of these, you have the analytics, but you also have that, call it, subjective feel that you get, and both of those lead me to believe that this is going into the first half of '22.

是的。你看，我們看到了很多跡象。我有分析數據可以看到。顯然，你不可能總是能看到 100% 的結果。但我對我們獲得的可見度感到滿意。為了確保不遺漏任何內容，塔德和我每週都會複習多次。但這不是開玩笑，最大的衡量標準是我從客戶那裡接到了多少個升級電話，這是最大的指標。當我——當我的電話開始響起，它不再每天響 50 次，那麼我就知道我們已經不再處於今天的境地了。因此，您既有分析能力，也有主觀感受，這兩者都讓我相信這將持續到 22 年上半年。

And Mark, just to add, we're not seeing any meaningful cancellations or push outs at this time. We've also taken the inventory in the channels down so that we can manage that escalation process, whether that customer is in the channel or direct and essentially making sure customers are getting the inventory just as they need it rather than stockpiling it. So we're doing our best to manage it, and I think we've got good analytics and visibility on what's happening right now.

馬克，補充一下，我們目前沒有看到任何有意義的取消或延遲。我們還減少了通路中的庫存，以便我們能夠管理升級過程，無論客戶是透過管道還是直接購買，並從本質上確保客戶在需要時獲得庫存，而不是囤積庫存。因此，我們正在盡力管理它，我認為我們對現在發生的事情有了很好的分析和了解。

Your next question comes from Raji Gill from Needham & Company.

您的下一個問題來自 Needham & Company 的 Raji Gill。

Congrats as well on great momentum across the board. Thad, just picking up on your commentary around the inventory. I think last quarter you had talked about that you wanted to build inventory on your balance sheet while reducing inventory in the channel and that you're actively reducing channel inventory while holding more inventory on your own balance sheet in order to allocate the right products to the right customers and therefore, preventing any excess inventory sitting in the channel. Wondering how that strategy is playing out this quarter and how do we think about that over the next couple of quarters in a continuation of a supply-constrained environment.

也祝賀大家各方面都取得了良好的發展動能。泰德，我只是想了解你關於庫存的評論。我認為上個季度您曾談到過，您希望在資產負債表上建立庫存，同時減少渠道庫存，並且您正在積極減少渠道庫存，同時在自己的資產負債表上保留更多庫存，以便將正確的產品分配給正確的客戶，從而防止任何過剩庫存積壓在渠道中。想知道該策略在本季如何發揮作用，以及在供應持續受限的環境下，我們如何看待未來幾季的這項策略。

Yes. So we were at 8.4 weeks in the channel last quarter. We're at 7.3 weeks this quarter. So on a revenue value, that was a decrease of almost $43 million in channel inventory. At the same time, our balance sheet inventory went up slightly in terms of dollars, about $14 million, but down in terms of days, it went down in 8 days. So we're still executing to that strategy of pointing that inventory. Obviously, as inventory becomes -- finished goods become available, we're shipping them. So as we look forward, we think we'll continue the strategy through the remainder of this year. I think inventory in the channel is going to stay in this level, kind of plus or minus. And I think our inventory on our balance sheet will probably remain relatively flat to down slightly, just depending on our capacity to get more supply. So through the remainder of this year, we don't see a change in our strategy of holding that inventory.

是的。因此，上個季度我們在該頻道的時長為 8.4 週。本季已持續 7.3 週。因此從收入價值來看，通路庫存減少了近 4,300 萬美元。同時，我們的資產負債表庫存以美元計算略有增加，約 1,400 萬美元，但以天數計算則有所下降，為 8 天。因此我們仍在執行指向庫存的策略。顯然，隨著庫存的增加——成品可用，我們就會發貨。因此展望未來，我們認為我們將在今年剩餘時間內繼續實施這項策略。我認為渠道中的庫存將保持在這個水平，有增有減。我認為我們資產負債表上的庫存可能會保持相對穩定或略有下降，這只是取決於我們獲得更多供應的能力。因此，在今年剩餘時間內，我們的庫存持有策略不會改變。

And just a couple more follow-ups, if I can. Thad, you had mentioned that you had secured additional supply internally. Wondering if you could elaborate further on how much supply you're able to get. What were the steps that you did in order to kind of alleviate that supply and increase more supply? And how do we think about more supply coming online, whether internally or externally? And just Hassane, I just have a question on the automotive revenue. You've had record automotive revenue. You obviously want to shift to electric vehicles, energy -- renewable energy infrastructure. Maybe you can give us some updated thoughts on your silicon carbide power products and power modules for charging stations and onboard chargers?

如果可以的話，我還有幾件後續事情。泰德，你曾提到你已經在內部確保了額外的供應。想知道您是否可以進一步詳細說明您能夠獲得多少供應。為了緩解供應問題並增加供應，您採取了哪些措施？我們如何看待更多供應的出現，無論是內部還是外部？哈桑，我只想問一下汽車收入。你們的汽車收入創下了歷史新高。你顯然希望轉向電動車、能源——再生能源基礎設施。也許您可以給我們一些關於用於充電站和車載充電器的碳化矽電源產品和電源模組的最新想法？

Yes. So Raji, in terms of the supply and what we saw, our utilization was relatively flat quarter-on-quarter, but we got more supply out. So this is really the optimization and the efficiency of our manufacturing site. Now we manufacture about 65% of our own product in-house, 35% outside. We still remain severely constrained on the outside, but we've got more control on the inside with what we can do. So as our manufacturing team has executed, we've been able to just squeeze more out of the existing footprint. And then if you look forward to our Q3 guide, which is up at the midpoint, you can see we're getting more supply coming into Q3 as well. So again, this is just really the optimization of that -- of the existing footprint.

是的。因此，拉吉，就供應而言，我們看到，我們的利用率與上一季相比相對持平，但我們的供應量有所增加。這確實是我們製造工廠的最佳化和效率。現在，我們約 65% 的產品在內部生產，35% 在外部生產。我們在外部仍然受到嚴重限制，但我們在內部對自己能做的事情有了更多的控制。因此，正如我們的製造團隊所執行的那樣，我們已經能夠從現有的空間中榨取更多的效益。如果你期待我們的第三季指南（該指南位於中點），你會發現我們在第三季也獲得了更多的供應。所以，這其實只是對現有足跡的最佳化。

Yes. And as far as your second question about our power products, obviously, I mentioned renewable energy. I mentioned electric vehicles, which for me is both traction and onboard charging. So as the power demand goes up as far as the need from customers, think about the fast charging, whether it's onboard charging or infrastructure, the charger on the road or the traction. Where we are winning and why we are winning is our highly competitive efficiency metric that comes from the prowess and technology that we are flexing but more importantly, our packaging technology. When you put those 2 together, you get a lighter and more efficient traction module. Lighter is obviously good for EVs for distance, but lighter and smaller is also good for packaging. So we're able to get the same, call it, equivalent power output of our silicon and silicon carbide modules. And I talk about module being the device and the packaging better than the equivalent competitor power output. That's where we win. You'll hear a little bit more about that at the Analyst Day, but that's what I tie our current wins to. And when I look at the funnel and talk to the customer, since I've taken over, a lot of customers I call is why do we win? Why do you pick ON? And those are the ones that I'm pushing into our strategy to do more of and where they say we lack, we're putting R&D in order to leapfrog the competition. So all of these give me the confidence, one, on our posture today, our posture with the design win forward-looking that's going to fuel our growth; and more importantly, where we are investing R&Ds to sustain that momentum forward-looking.

是的。至於您關於我們的電力產品的第二個問題，顯然我提到了再生能源。我提到了電動車，對我來說，它既意味著牽引力，也意味著車載充電。因此，隨著客戶對電力的需求不斷增加，請考慮快速充電，無論是車載充電還是基礎設施、道路上的充電器或牽引力。我們成功的地方以及成功的原因在於我們極具競爭力的效率指標，而這個指標來自於我們所展現的實力和技術，但更重要的是我們的包裝技術。將這兩者結合在一起，您將獲得一個更輕、更有效率的牽引模組。對於電動車來說，更輕的車顯然有利於行駛距離，但更輕更小的車也有利於包裝。因此，我們能夠獲得相同的、所謂的等效矽和碳化矽模組的功率輸出。我所說的模組是比同等競爭對手的功率輸出更好的設備和包裝。這就是我們的勝利。您會在分析師日上聽到更多關於此的內容，但這就是我將我們當前的勝利歸因於此。自從我接手以來，當我查看漏斗並與客戶交談時，我打電話問的許多客戶都是為什麼我們能成功？為什麼選擇 ON？這些都是我正在推動納入我們策略以進一步實現的目標，而對於他們所認為的我們所欠缺的，我們正在投入研發以超越競爭對手。所以所有這些都給了我信心，第一，我們今天的態勢，我們前瞻性的設計勝利態勢，這將推動我們的成長；更重要的是，我們正在投資研發以保持這一發展勢頭。

Your next question comes from John Pitzer from Crédit Suisse.

您的下一個問題來自瑞士信貸的約翰‧皮策 (John Pitzer)。

Congratulations on the solid results. Hassane, I'd like to go back to kind of the significant gross margin upside you've seen over the last couple of quarters. I'm just kind of curious, what inning do you think you're in as far as repositioning the portfolio to higher margin? And I guess, was there any meaningful sort of advantage to kind of trying to price yourself out of certain businesses right now and customers didn't walk away, so that we saw some cyclical pricing advantage to either the June gross margins or the September gross margins?

恭喜您取得堅實的成果。哈桑，我想回顧過去幾季你所看到的毛利率的大幅上升。我只是有點好奇，您認為在重新定位投資組合以獲得更高的利潤方面您處於什麼階段？我想，現在試圖將某些業務的價格定在較低水平，而客戶又沒有流失，這是否有任何有意義的優勢，以便我們看到 6 月份毛利率或 9 月份毛利率出現週期性定價優勢？

Yes. So look, we're -- as far as inning, call it, we're in early innings as far as what we're able to do. You're starting to see the momentum of the work we've done in Q1 and Q2 starting to kind of come about. We haven't seen the benefit from some of the manufacturing rationalization, the actual fab divestitures that, at least the ones that we've talked about, you haven't seen that benefit yet. So that's going to fuel our more of the gross margin expansion forward-looking. Right now, it's on cost, product mix, product costs, product value, et cetera, all of those are what you're seeing today. So there is more to come as you -- as we deploy and execute our strategy forward-looking. So that gives me the comfort of where we are as far as in our trajectory in the gross margin expansion.

是的。所以看，我們 — — 就局而言，可以這麼說，就我們能夠做的而言，我們正處於早期局。您開始看到我們在第一季和第二季所做工作的勢頭開始顯現。我們還沒有看到一些製造合理化、實際的晶圓廠剝離帶來的好處，至少是我們談到的那些，你還沒有看到好處。因此這將進一步促進我們毛利率的擴大。現在，它涉及成本、產品組合、產品成本、產品價值等等，所有這些都是您今天所看到的。因此，隨著我們部署和執行前瞻性策略，還會有更多事情要做。因此，這讓我對我們的毛利率擴張軌跡感到安心。

That's helpful. And then Hassane, the gross margins were impressive. I would argue that free cash flow was even more impressive. And if you looked at your shared schedule on your website, there's not a lot of dilution coming down as the stock price goes up. So I'm kind of curious how you guys are thinking about sort of the use of cash and cash return, given how strong the free cash flow generation looks like it was in the quarter and should continue to be.

這很有幫助。然後哈桑 (Hassane)，毛利率令人印象深刻。我認為自由現金流更加令人印象深刻。如果你查看網站上的分享時間表，你會發現，隨著股價上漲，股權稀釋現象並不嚴重。因此，我有點好奇你們是如何考慮使用現金和現金回報的，考慮到本季度自由現金流的強勁增長並且應該繼續保持這種勢頭。

Yes, John, it's Thad. You're right. Now that we took out that convert and swapped it out for a new convert, that old one was heavily in the money, so the dilution impact isn't as significant as what you're seeing in the past. And if you look at our guidance for next quarter, 436 million shares, it's just up a small tick, right? So as we think about the cash generation right now, it's balance sheet flexibility; it's continue to pay down the debt; long term, we'll look at returning capital to shareholders; but right now, it's reinvest in the business and have balance sheet flexibility.

是的，約翰，我是泰德。你說得對。現在我們已將該可轉換債券取出並將其換成新的可轉換債券，舊的可轉換債券已處於高價位，因此稀釋影響並不像過去那麼顯著。如果你看我們對下一季的預期，4.36 億股，這只是小幅上漲，對嗎？因此，當我們考慮當前的現金創造時，它是資產負債表的靈活性；它繼續償還債務；從長遠來看，我們將著眼於向股東返還資本；但現在，它正在對業務進行再投資，並具有資產負債表靈活性。

Your next question comes from Harlan Sur from JPMorgan.

您的下一個問題來自摩根大通的 Harlan Sur。

Congratulations on the solid results and execution. The image sensor business again undergrew both auto and industrial on a quarter-on-quarter and year-over-year basis, and I know most of this business is outsourced. You talked previously about being supply-constrained into the first half of next year. Has that supply normalization actually pushed out given the strong demand you're seeing? And then just given the strategic nature of sensing to your strategy and portfolio, is this a technology and product segment that the team is actually thinking about potentially bringing in-house?

恭喜您取得了堅實的成果和執行力。與上一季和去年同期相比，影像感測器業務的成長再次低於汽車和工業領域，我知道該業務大部分都是外包的。您之前談到明年上半年供應將受到限制。鑑於您所看到的強勁需求，供應正常化是否真的實現了？然後考慮到感知對您的策略和投資組合的戰略性質，這是團隊實際上正在考慮可能引入內部的技術和產品領域嗎？

Look, so that -- you're absolutely right. This is a very constrained because majority of all of it is foundry based. Now as far as over the long-term strategy about what we do outside or inside, we'll be talking more about that in our Analyst Day. But it is fundamental to our strategy. And therefore, the supply constraint is not something we can solve right now. Right now, it's more on optimizing the existing supply chain that we have because imagine that technology is not you can pick up a fab, whether internal or external, and get some expansion. There's a lot of R&D work that needs to go into qualifying and running that image sensing technologies in very specific fabs that require CapEx and R&D. Obviously, we're looking at all options. But right now through, call it, '22, it's what more can we get out of the foundry partners.

瞧，所以——你完全正確。這是非常受限制的，因為其中大多數都是基於代工廠的。現在關於我們在內部和外部所做工作的長期策略，我們將在分析師日上進一步討論。但它對於我們的戰略而言至關重要。因此，供應限制不是我們現在能夠解決的問題。現在，我們更需要優化現有的供應鏈，因為想像一下，技術不是你可以選擇一個晶圓廠（無論是內部還是外部）並進行一些擴張。需要投入大量的研發工作來鑑定和運行影像感測技術，這些技術在特定的工廠中需要資本支出和研發。顯然，我們正在考慮所有的選擇。但現在，我們稱之為‘22’，我們能從代工合作夥伴那裡得到更多。

Got it. And then normally, the team's December quarter from a seasonal perspective is flat to down slightly sequentially, but just given the strong demand velocity, given the backlog visibility, combined with your supply additions coming on in the second half, would the team anticipate a better-than-seasonal growth trend for the December quarter?

知道了。通常情況下，從季節性角度來看，該團隊的 12 月季度是持平或環比略有下降的，但考慮到強勁的需求速度，考慮到積壓訂單的可見性，再加上下半年的供應增加，團隊是否會預計 12 月季度的增長趨勢會好於季節性？

Look, I don't think we can talk about seasonality, but I'll let Thad comment. But seasonality at this point is really we don't -- we have the demand. Right now, our top line and our forward-looking is based on the supply and the mix we were able to get out of our footprint.

看，我認為我們不能談論季節性，但我會讓泰德發表評論。但此時的季節性其實是我們沒有的——我們有需求。目前，我們的營收和前瞻性是基於我們能夠從我們的足跡中獲得的供應和組合。

Yes. So Hassane is right. We're limited by supply, and so the demand is there. So as we look into the fourth quarter, we think we're going to be at the top end of our normal seasonality, which normal seasonality is kind of flat to down 2%.

是的。因此哈桑是對的。我們受到供應的限制，所以有需求。因此，當我們展望第四季時，我們認為我們將處於正常季節性的最高端，正常季節性基本上持平或下降 2%。

Your next question comes from Vijay Rakesh from Mizuho.

您的下一個問題來自瑞穗的 Vijay Rakesh。

Hassane and Thad, congratulations on a great quarter and guide. Just wondering on the EV and ADAS, it looks like very strong growth there. If you could give us some color on how that grew sequentially? And as you exit the year, if you can talk to what the mix you see, especially with your traction on the EV side? How that EV and ADAS mix grows year-on-year as a percent of revenues?

哈桑 (Hassane) 和薩德 (Thad)，祝賀你們度過了一個美好的季度並提供了出色的指導。只是好奇一下 EV 和 ADAS，看起來那裡的成長非常強勁。您能否向我們介紹一下其如何持續成長？在結束這一年之際，您能談談您所看到的組合，特別是在電動車方面的牽引力嗎？EV 和 ADAS 組合佔收入的百分比年增率如何？

We are not breaking up by technology or by subsegment. We're just looking at the automotive. We expect automotive to maintain the growth. Obviously, it is limited by what I mentioned earlier in the prior question on the ADAS side from the supply and the imaging, which we are highly constrained on. As far as the rest of our power products or, call it, the silicon non-imaging product -- power products, that's going to be on -- based on how much we are able to get more out of our supply chain footprint, as Thad mentioned, through the efficiencies that our supply chain team has been working on. So I still see the momentum there. There is growth built in. The demand is there. And right now, it's how much of that demand can we service.

我們不會依照技術或細分市場進行細分。我們只關注汽車。我們預計汽車產業將保持成長。顯然，它受到我之前在 ADAS 方面的問題中提到的供應和成像的限制，我們在這方面受到嚴格限制。至於我們其餘的電源產品，或稱為矽非成像產品 - 電源產品，正如 Thad 所提到的，這將取決於我們能夠從供應鏈足跡中獲得更多收益，透過我們的供應鏈團隊一直致力於提高的效率。因此我仍然看到那裡的勢頭。其本身俱有增長能力。需求是存在的。現在的問題是，我們能滿足多少需求。

Got it. And as you look out, I know Thad mentioned going into Q4 more like the top ends were flattish. But wondering if you can give us some idea on how the book-to-bill is trending. How it was in Q2? How you see Q3, Q4? You can give us some idea there in terms of how orders are coming in.

知道了。正如您所看到的，我知道 Thad 提到進入第四季度，頂端情況更加平穩。但我想知道您是否可以告訴我們訂單出貨比的趨勢如何。第二季的情況如何？您如何看待第三季和第四季？您可以向我們介紹訂單的接收情況。

Yes, Vijay, I mean, the book-to-bill is strong, right? It's remained strong. We think it's going to continue through the remainder of the year. Again, it's supply that's the issue. We're not seeing major cancellations or pushouts. We're seeing just consistent strength right now. So we're not seeing any major swings in the book-to-bill.

是的，維傑，我的意思是，訂單出貨比很強勁，對吧？它依然保持強勁。我們認為這種趨勢將持續到今年剩餘時間。再次強調，供應才是問題所在。我們沒有看到大規模的取消或延遲情況。我們現在看到的只是持續的力量。因此，我們沒有看到訂單出貨比有任何重大波動。

Your next question comes from William Stein from Truist.

您的下一個問題來自 Truist 的 William Stein。

I want to add my hearty congratulations to great results and even better outlook. First, the compute end market was particularly strong in the quarter. I think you attributed that or you at least highlighted graphics cards to part of the success there. I'm wondering if you can talk about trends in that end market as we look out over the next couple of quarters. There's been some concern about perhaps aggregate inventories or mismatched bills of materials that might cause a hiccup in that end market. I wonder what you're seeing in terms of the outlook there. And then I do have a follow-up.

我要對優異的成績和更加美好的前景表示衷心的祝賀。首先，本季計算端市場表現尤為強勁。我認為您將此歸因於或至少強調顯示卡是其成功的部分原因。我想知道您是否可以談談未來幾季終端市場的趨勢。人們擔心總庫存或不匹配的物料清單可能會導致終端市場出現問題。我想知道您對那裡的前景有何看法。然後我確實有一個後續行動。

Yes. Look, we're seeing strength in both cloud and the server market. So that -- it's over market growth. If you look what customers are doing, there is more and more capacity for expansion in these markets, and that's what we're correlating on our demand. So I think the market took a pause in 2020 and maybe at the beginning of '21, and now it's starting to pick up. From an investment side, I don't see that kind of slowing down. We're going to keep monitoring it just like we are every other market. And our focus in these is limited to what we want to do on the product side. Those are what I would call adjacent markets where we have very compelling and competitive products that we are able to service in these markets, and we're going to be pushing that through to our customers. But from the science and the data I get from our customers directly, there is capacity expansion on their side, and that gives me the visibility on the confidence in the demand that we have in our backlog for these markets.

是的。你看，我們看到雲端運算和伺服器市場都表現強勁。所以 — — 這是市場成長的結果。如果你觀察一下客戶在做什麼，你會發現這些市場的擴張能力越來越強，這就是我們的需求所對應的。因此，我認為市場在 2020 年甚至可能是 21 年初暫停了一段時間，現在開始回升。從投資方面來看，我不認為會出現這種放緩的現象。我們將繼續監控它，就像我們對其他市場一樣。而我們的重點僅限於我們想要在產品方面做的事情。這就是我所說的相鄰市場，我們擁有非常引人注目和有競爭力的產品，我們能夠在這些市場上提供服務，並且我們將把這些產品推向我們的客戶。但從我直接從客戶那裡獲得的科學數據來看，他們的產能正在擴大，這讓我對我們在這些市場積壓訂單的需求充滿信心。

Great. And then as a follow-up, you talked about capacity expansion in the next few quarters. I may have missed it, but is there an aggregate sort of unit growth or dollar growth that's getting built in as we think about demand and supply perhaps rationalizing or coming into somewhat of a stasis in the first half of next year as you've highlighted? What should we think about your total capacity as we progress into that time frame?

偉大的。然後作為後續問題，您談到了未來幾季的產能擴張。我可能錯過了，但當我們考慮需求和供應時，是否存在總體單位增長或美元增長，也許正如您所強調的那樣，在明年上半年需求和供應可能合理化或進入某種停滯狀態？隨著我們進入這個時間範圍，我們應該如何看待您的總容量？

Well, I would say like we've got a couple of things going on. We've got the 300-millimeter fab coming online in '23. We're continuing to push production in there. We are supply constrained. We'll continue to optimize, but I would look at just our supply as being -- at least through the time horizon you're talking about the first half of next year as being pretty steady with some small increase as we continue to optimize and get more output.

嗯，我想說我們有幾件事要做。我們的 300 毫米晶圓廠將於 23 年上線。我們將繼續在那裡推動生產。我們的供應受到限制。我們將繼續優化，但我認為我們的供應量至少在你們談論的明年上半年的時間範圍內是相當穩定的，隨著我們繼續優化並獲得更多產量，供應量會略有增加。

Your next question comes from Christopher Rolland from Susquehanna.

您的下一個問題來自薩斯奎哈納的克里斯多福羅蘭。

Congrats as well on all the progress you've made in just a few quarters, guys. The first question is for Hassane. Hassane, LTSAs were a big deal for you guys at Cypress. Can you expand there? Perhaps what end markets you're looking to do long-term supply agreements for? How they're being used strategically? And ultimately, do you guys have a goal of kind of what percent of revenue you ultimately want under long-term agreements?

大家好，我也祝賀你們在短短幾季內的進步。第一個問題是問哈桑的。Hassane，LTSA 對賽普拉斯來說意義重大。能擴展一下嗎？也許您希望與哪些終端市場簽訂長期供應協議？它們是如何被策略性地運用的？最後，你們的目標是什麼？根據長期協議，你們最終希望獲得多少比例的收入？

Yes, Chris. So obviously, our focus is to start with, number one, our strategic markets; and two, strategic products and strategic customers in those markets. So that's kind of the priority that we are doing because -- and that's the start because think about it from a strategic perspective, I wouldn't want to lock in supply before I get all of my automotive customers taken care of, for example. And once that happens, then you start going automotive, industrial, and it's based on customers and the breadth of customer within -- for ON. Are they buying multiple products where cross-selling plays a big impact in our decision or is it a one product? So that helps us strategically assess where we are. Obviously, our goal is to remain and support all of the customers that we have, and that's how we're going to maintain the growth. But as far as LTSA, I'm starting with strategic market, strategic customers and breadth of customers because that's what's going to fuel, one, our growth, but more importantly, our stickiness. The broader we are, the more sticky we are because that's where the value comes in not from a product, but from a company perspective. So to answer your question about a percent, given that I really don't have a percent target, what I want is to drive the right strategic behavior because if I throw a percent out there, I guarantee you we will need it. My view is, I'm looking at it strategically. Whatever the percent ends up, it ends up. But I -- we do have, based on the product lines, so not at the group level, but at click below that, they have kind of targets where we may not want to go up to 80%, for example, because you want to keep 20% or 30% dynamic for the growth that we get from new customers that are not yet at the level we want to do in LTSA. So there's a lot of play in there, and we're taking it very, very surgical on an account, market and really segment basis.

是的，克里斯。因此顯然，我們的重點首先是我們的策略市場；二是這些市場中的策略產品和策略客戶。所以這是我們正在做的優先工作，因為——這是一個開始，因為從戰略角度考慮這個問題，例如，在我照顧好所有汽車客戶之前，我不想鎖定供應。一旦發生這種情況，您就會開始進入汽車、工業領域，並且取決於客戶及其內部客戶的廣度——對於 ON 而言。他們是否購買多種產品，其中交叉銷售對我們的決策有很大影響，還是只購買一種產品？這有助於我們從策略上評估我們所處的位置。顯然，我們的目標是保住並支持我們所有的客戶，這就是我們保持成長的方式。但就 LTSA 而言，我從策略市場、策略客戶和客戶廣度開始，因為這將推動我們的成長，但更重要的是，推動我們的黏性。我們的範圍越廣，我們的黏性就越強，因為價值不是來自於產品，而是來自於公司的角度。因此，要回答你關於百分比的問題，鑑於我確實沒有百分比目標，我想要的是推動正確的策略行為，因為如果我給出一個百分比，我保證我們會需要它。我的觀點是，我從戰略上看待這個問題。無論百分比最終是多少，它都會結束。但我 — — 我們確實有基於產品線的目標，所以不是在集團層面，而是在其下方，他們有某種目標，我們可能不想上升到 80%，例如，因為你想保持 20% 或 30% 的動態增長，因為我們從新客戶那裡獲得的增長還沒有達到我們在 LTSA 中想要達到的水平。因此，這其中有很多玩法，我們會根據帳戶、市場和真正的細分基礎，非常精確地進行操作。

Excellent. And then a question around the fab footprint. First of all, any updates on your existing fabs for sale? And then secondly, on East Fishkill, the prior management team talked about $2.3 billion in additional revenue. Do you have an update there? In this environment, do you think that could be substantially higher?

出色的。然後是關於晶圓廠足跡的問題。首先，您現有的待售晶圓廠有什麼最新消息嗎？其次，關於東菲什基爾，前管理團隊談到了 23 億美元的額外收入。您那裡有更新訊息嗎？在這種環境下，您認為這個數字還可能會大幅上升嗎？

Yes, in terms of the fab footprint, we continue to look at it. We're in deep discussions with a couple -- well, quite a few parties actually on the 2 fabs that we publicly announced. So those are tracking along. As you know, it takes time to exit a fab, right, but getting the structure in place is more important than the timing of the exit. So even though we haven't announced something, we're still along our path of timing, but it does take time, but things are progressing nicely there.

是的，就晶圓廠的佔地面積而言，我們會繼續關注。我們正在與一些各方進行深入討論，實際上是與許多方就我們公開宣布的兩座晶圓廠進行討論。所以這些都是在跟蹤。如你所知，退出一家晶圓廠需要時間，但建立結構比退出時機更重要。因此，即使我們還沒有宣布什麼，我們仍然按照計劃進行，但這確實需要時間，但事情進展順利。

Look, on the East Fishkill fab, obviously, we are in a path to -- we're changing even the mix of what goes in that fab based on our new strategy and our new direction. I wouldn't put yet a number to it. Of course, we're getting it because it's going to drive incremental growth that is part of the strategy, but I'll be more comfortable disclosing that number and that target and how we progress against it once we have ownership of that fab.

你看，在 East Fishkill 工廠，顯然，我們正在根據我們的新策略和新方向改變該工廠的產品組合。我還沒給它定一個數字。當然，我們之所以獲得它，是因為它將推動增量成長，這是策略的一部分，但是一旦我們擁有該工廠的所有權，我會更願意披露該數字和目標，以及我們將如何實現這一目標。

I would now like to turn the call over back to Mr. Hassane El-Khoury, President and CEO.

現在我想將電話轉回給總裁兼執行長 Hassane El-Khoury 先生。

Thank you all for joining us today. I once again thank our worldwide team for their hard work in driving our transformation and solid results. It's been an exciting few quarters, and we are firing on all cylinders. We remain focused on our execution and our drive to streamline our business and unlock our value. I look forward to seeing you all at our Analyst Day in a few days for a deeper look into our strategy and our transformation.

感謝大家今天的參與。我再次感謝我們全球團隊為推動我們的轉型和堅實成果所做的努力。過去的幾季令人興奮，我們正全力以赴。我們將繼續專注於執行，並努力簡化業務並釋放價值。我期待幾天後在分析師日上見到大家，深入了解我們的策略和轉型。

This concludes today's conference call. Thank you all for joining. You may now disconnect.

今天的電話會議到此結束。感謝大家的加入。您現在可以斷開連線。