Pixelworks Inc (PXLW) 2023 Q1 法說會逐字稿

Good day, ladies and gentlemen, and welcome to Pixelworks, Inc.'s First Quarter 2023 Earnings Conference Call. I will be your operator for today's call. (Operator Instructions) This conference call is being recorded for replay purposes.

女士們先生們，美好的一天，歡迎來到 Pixelworks, Inc. 的 2023 年第一季度收益電話會議。我將是您今天電話的接線員。 （操作員說明）正在錄製此電話會議以供重播。

I would now like to turn the call over to Brett Perry with Shelton Group Investor Relations.

我現在想把電話轉給 Shelton Group Investor Relations 的 Brett Perry。

Thank you, Liz. Good afternoon, and thank you joining us on today's call. With me on the call are Pixelworks' President and CEO, Todd DeBonis; and Chief Financial Officer, Haley Aman. The purpose of today's conference call is to supplement the information provided in Pixelworks' press release issued earlier today announcing the company's financial results for the first quarter of 2023.

謝謝你，麗茲。下午好，感謝您參加今天的電話會議。和我一起通話的是 Pixelworks 的總裁兼首席執行官 Todd DeBonis；和首席財務官 Haley Aman。今天電話會議的目的是補充 Pixelworks 今天早些時候發布的新聞稿中提供的信息，該新聞稿宣布了公司 2023 年第一季度的財務業績。

Before we begin, I'd like to remind you that various remarks we make on the call, including those about projected future financial results, economic and market trends and competitive position, constitute forward-looking statements. These forward-looking statements and all other statements made on this call that are not historical facts are subject to a number of risks and uncertainties that may cause actual results to differ materially.

在我們開始之前，我想提醒您，我們在電話會議上發表的各種言論，包括有關預計未來財務業績、經濟和市場趨勢以及競爭地位的言論，均構成前瞻性陳述。這些前瞻性陳述和在本次電話會議上做出的所有其他非歷史事實的陳述都受到許多風險和不確定性的影響，這些風險和不確定性可能導致實際結果存在重大差異。

All forward-looking statements are based on the company's beliefs as of today, Tuesday, May 9, 2023. The company undertakes no obligation to update any such statements to reflect events or circumstances occurring after today. Please refer to today's press release, the annual reports on Form 10-K for the year ended December 31, 2022, and subsequent SEC filings for a description of factors that could cause forward-looking statements to differ materially from actual results.

所有前瞻性陳述均基於公司截至今天（2023 年 5 月 9 日，星期二）的信念。公司不承擔更新任何此類陳述以反映今天之後發生的事件或情況的義務。請參閱今天的新聞稿、截至 2022 年 12 月 31 日止年度的 10-K 表格年度報告，以及隨後提交給美國證券交易委員會的文件，了解可能導致前瞻性陳述與實際結果存在重大差異的因素說明。

Additionally, the company's press release and management statements during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms, including gross margin, operating expenses, net loss and net loss per share. Non-GAAP measures include amortization of acquired intangible assets and stock-based compensation expense as well as the tax effects of the non-GAAP adjustments. The company uses these non-GAAP measures internally to assess operating performance. We believe these non-GAAP measures provide a meaningful perspective on core operating results and underlying cash flow dynamics. We caution investors to consider these measures in addition to, and not as a substitute for, nor superior to, the company's consolidated financial results as presented in accordance with GAAP.

此外，公司在本次電話會議期間的新聞稿和管理層聲明將包括以 GAAP 和非 GAAP 條款討論某些措施和財務信息，包括毛利率、運營費用、淨虧損和每股淨虧損。非 GAAP 措施包括所收購無形資產的攤銷和基於股票的補償費用以及非 GAAP 調整的稅收影響。公司在內部使用這些非 GAAP 指標來評估經營業績。我們相信，這些非 GAAP 指標為核心經營業績和潛在現金流動態提供了有意義的視角。我們提醒投資者考慮這些措施，而不是替代或優於公司根據 GAAP 提出的綜合財務業績。

Also note, throughout the company's press release and management statements during this conference, we refer to net loss attributable to Pixelworks, Inc. as simply net loss. For additional details and reconciliations of GAAP to non-GAAP net loss and GAAP net loss to adjusted EBITDA, please refer to the company's press release issued earlier today.

另請注意，在本次會議期間的公司新聞稿和管理層聲明中，我們將可歸因於 Pixelworks, Inc. 的淨虧損簡稱為淨虧損。有關 GAAP 與非 GAAP 淨虧損和 GAAP 淨虧損與調整後 EBITDA 的更多詳細信息和對賬，請參閱公司今天早些時候發布的新聞稿。

With that, it's now my pleasure to turn the call over to Pixelworks' CEO, Todd DeBonis. Please go ahead.

因此，現在我很高興將電話轉給 Pixelworks 的首席執行官 Todd DeBonis。請繼續。

Thank you, Brett, and good afternoon, and welcome to those participating on today's call. Coming off our 27% revenue growth in '22, we acknowledge that revenue would be down significantly in the first quarter due to a combination of the inventory correction in the broader smartphone market as well as anticipated seasonality in the projector market. As outlined in today's press release, our first quarter financial results were consistent with our prior guidance.

謝謝布雷特，下午好，歡迎參加今天的電話會議。考慮到我們 22 年 27% 的收入增長，我們承認，由於更廣泛的智能手機市場的庫存調整以及投影儀市場的預期季節性，第一季度的收入將大幅下降。正如今天的新聞稿所述，我們第一季度的財務業績與我們之前的指引一致。

Today, we are confident that Q1 was the bottom of the correction for our mobile business. As of the end of March, all previous inventory of our mobile ICs, both within the channel and held by customers, was well below normal, clearing the way for renewed growth and momentum in the second quarter.

今天，我們相信第一季度是我們移動業務調整的底部。截至 3 月底，我們之前所有的移動 IC 庫存，包括渠道內和客戶持有的庫存，都遠低於正常水平，為第二季度的新增長和動力掃清了道路。

Taking a closer look at the mobile market, there's recently been ample market commentary from many of the prominent suppliers that sell into the smartphone segment. Rather than reiterating general comments on the market, we will focus on how Pixelworks and our current position is different than some of these other companies.

仔細觀察移動市場，最近有許多智能手機領域的知名供應商發表了大量的市場評論。我們不會重申對市場的一般評論，而是關注 Pixelworks 和我們目前的立場與其他一些公司有何不同。

Clearly, an inventory correction has been taking place as many suppliers overbuilt, and both the distribution channel and smartphone OEMs amassed excess inventory due to the weaker-than-anticipated demand in '22, which continued into Q1 of 2023. As a result, multiple component suppliers indicated that digesting that inventory could potentially extend out to the end of this year.

顯然，庫存修正一直在進行，因為許多供應商過度建設，而且由於 2023 年第一季度的需求弱於預期，分銷渠道和智能手機原始設備製造商都積累了過剩庫存。因此，多個零部件供應商表示，消化庫存可能會持續到今年年底。

Specific to Pixelworks, we were capacity constrained for effectively all of 2022, and with that, we managed inventory conservatively. As a result, unlike many others today, we are shipping to fulfill current customer demand and refill depleted channel partners buffer inventory.

具體到 Pixelworks，我們實際上在 2022 年全年都受到產能限制，因此，我們保守地管理庫存。因此，與今天的許多其他公司不同，我們正在發貨以滿足當前客戶的需求並補充耗盡的渠道合作夥伴緩衝庫存。

Regarding China smartphone ODM demand, although there are different views on the pace of the China recovery, most industry commentary suggest that the global smartphone demand is softer than previously hoped, which translates into taking longer to digest excess inventory. While softer demand may be true for the broader mobile market, the flagship and premium segments that we predominantly sell into are outperforming the broader market.

關於中國智能手機 ODM 需求，儘管對中國復甦的步伐存在不同看法，但大多數行業評論表明，全球智能手機需求比之前預期的要疲軟，這意味著需要更長的時間來消化過剩庫存。雖然更廣泛的移動市場需求疲軟可能是真實的，但我們主要銷售的旗艦和高端細分市場的表現優於更廣泛的市場。

In addition, the customers' models that include our visual processors are exceeding preliminary forecast. Since February, we have received order pull-ins and upside demand from mobile customers on a combination of existing models and soon to be launched mobile programs. We have had multiple Tier 1 customers agree to cover the expedite fees to meet their revised demand profile.

此外，包含我們視覺處理器的客戶模型超出了初步預測。自 2 月以來，我們收到了移動客戶對現有模型組合和即將推出的移動程序的訂單拉動和上行需求。我們有多個一級客戶同意支付加速費用以滿足他們修改後的需求概況。

To briefly recap our mobile wins announced year-to-date, we've been in 6 premium smartphone models launched by several of Pixelworks' multigenerational mobile customers, including OnePlus and realme, both OPPO sub-brands, as well as Honor and ASUS ROG. Together, these models represent multiple wins with Soft Iris, X5 and X7, our latest generation visual processor.

簡要回顧一下我們今年迄今宣布的移動勝利，我們已經參與了 Pixelworks 的幾家多代移動客戶推出的 6 款高端智能手機型號，包括 OPPO 子品牌 OnePlus 和 realme，以及 Honor 和 ASUS ROG .這些模型共同代表了我們最新一代視覺處理器 Soft Iris、X5 和 X7 的多項勝利。

As mentioned on the previous call, the OnePlus 11 and OnePlus Ace 2 flagship smartphones were launched at the beginning of the year and were 2 of the first devices to incorporate our latest X7 visual processor. Both of these devices feature the industry's first solution combined ultra-low latency motion engine, low-power super resolution and always on HDR. These functions have now been adapted for optimal performance on over 100 different popular mobile games.

正如在之前的電話會議中提到的，OnePlus 11 和 OnePlus Ace 2 旗艦智能手機於今年年初推出，是首批採用我們最新 X7 視覺處理器的兩款設備。這兩款設備均採用業界首個結合了超低延遲運動引擎、低功耗超分辨率和始終開啟 HDR 的解決方案。這些功能現在已經過調整，可在 100 多種不同的流行手機遊戲上實現最佳性能。

In February, one of the fastest-growing 5G smartphone brands, realme, launched the realme GT Neo5 smartphone, incorporating our X5 Plus visual processor. OPPO's realme GT series continues to embrace the high-quality display differentiation enabled by Pixelworks digital processors, which this latest model, coupled together with other hardware innovations, such as 240-watt fast charging capability.

今年 2 月，增長最快的 5G 智能手機品牌之一 realme 推出了搭載我們的 X5 Plus 視覺處理器的 realme GT Neo5 智能手機。 OPPO 的 realme GT 系列繼續採用 Pixelworks 數字處理器實現的高品質顯示差異化，這一最新型號與其他硬件創新相結合，例如 240 瓦快速充電能力。

Additionally, one of Pixelworks' first-ever mobile customers, ASUS, continued its adoption of our Pixelworks visual processing solutions in the launch of the ROG Phone 7 series, featuring our industry-leading HDR enhancement, professional color calibration and DC dimming technologies.

此外，Pixelworks 的首批移動客戶之一華碩在 ROG Phone 7 系列的發布中繼續採用我們的 Pixelworks 視覺處理解決方案，採用我們行業領先的 HDR 增強、專業色彩校準和 DC 調光技術。

Also during the quarter, Honor released the Magic5 series smartphones with both Honor Magic5 Pro and Honor Magic5 Ultimate incorporating our advanced X5 Plus visual processor. Subsequent to its launch, the Honor Magic5 Pro was listed and ranked by DXOMARK, an independent third-party quality evaluation lab. The Magic5 Pro scored an impressive 151 on DXOMARK's display test, ranking it #1 in global smartphone display performance.

同樣在本季度，榮耀發布了 Magic5 系列智能手機，榮耀 Magic5 Pro 和榮耀 Magic5 Ultimate 均採用了我們先進的 X5 Plus 視覺處理器。發布後，榮耀Magic5 Pro就入圍了獨立第三方質量評測實驗室DXOMARK榜單。 Magic5 Pro 在 DXOMARK 的顯示測試中獲得了令人印象深刻的 151 分，在全球智能手機顯示性能中排名第一。

Complementing our work with mobile OEMs, we continue to expand our initiatives with key partners aimed at establishing an advanced mobile gaming ecosystem. Following our initial collaboration with Unity as a verified solutions partner, we are advancing engagements with other leading gaming engines, including Unreal and multiple studios' own custom gaming engines. Together with the uniquely differentiated visual performance enabled by Pixelworks X7 visual processor and our rendering accelerator, SDK, we are increasing momentum on further collaboration with major mobile gaming studios.

作為與移動 OEM 合作的補充，我們繼續擴大與主要合作夥伴的計劃，旨在建立先進的移動遊戲生態系統。在我們作為經過驗證的解決方案合作夥伴與 Unity 進行初步合作之後，我們正在推進與其他領先遊戲引擎的合作，包括 Unreal 和多個工作室自己的定制遊戲引擎。連同 Pixelworks X7 視覺處理器和我們的渲染加速器 SDK 實現的獨特差異化視覺性能，我們正在加強與主要移動遊戲工作室進一步合作的勢頭。

We've announced 2 of these collaborations, the first of which was GALA Sports on their soccer simulation game, Total Football. The latest version of this game is now being launched internationally. However, when initially launched in Mainland China last year, it ranked among the top downloaded sports games and ranked 6 most downloaded in the free games category. Then yesterday, we announced our second collaboration with Nuverse on its latest release of Crystal of Atlan, which is developed using the Unreal 4 gaming engine. Both of these mobile games incorporate Pixelworks' rendering accelerator, SDK, which, in combination with our X7 processor, delivers an exceptional 120 frames per second visual experience with low power consumption.

我們已經宣布了其中 2 項合作，第一項是 GALA Sports 的足球模擬遊戲 Total Football。該遊戲的最新版本現已在國際上推出。然而，去年首次在中國大陸推出時，它就躋身下載量最高的體育遊戲之列，並在免費遊戲類別中排名第 6 位。然後在昨天，我們宣布了與 Nuverse 的第二次合作，推出其最新版本的 Crystal of Atlan，該遊戲是使用 Unreal 4 遊戲引擎開發的。這兩款手機遊戲都採用了 Pixelworks 的渲染加速器 SDK，它與我們的 X7 處理器相結合，以低功耗提供每秒 120 幀的卓越視覺體驗。

These types of direct engagement as well as other initiatives in our mobile gaming ecosystem have and continue to increase the awareness and recognition of Pixelworks. Looking ahead in the second quarter and second half of the year, we have a robust pipeline of Tier 1 mobile OEM programs. This includes our recently secured first design-in and production orders with our fourth Tier 1 mobile customer. We will begin shipping in support of these orders this quarter with this customer's first device incorporating Pixelworks technology scheduled to be launched in the third quarter. Taken together with our existing design-ins across other Tier 1 mobile OEMs, we expect renewed momentum accelerating into the second half of this year.

這些類型的直接參與以及我們移動遊戲生態系統中的其他舉措已經並將繼續提高 Pixelworks 的知名度和認可度。展望今年第二季度和下半年，我們擁有強大的一級移動 OEM 計劃管道。這包括我們最近與我們的第四個一級移動客戶獲得的第一個設計和生產訂單。我們將在本季度開始發貨以支持這些訂單，該客戶的首款採用 Pixelworks 技術的設備計劃於第三季度推出。結合我們在其他一級移動 OEM 中的現有設計，我們預計新的勢頭將加速進入今年下半年。

Now turning to an update on our TrueCut Motion platform. As we've been communicating to investors since launch, TrueCut Motion is a full ecosystem play, not a standalone solution. We continue to build out this ecosystem from the ground up. Advancing the technology innovation from the 24 frames per second that's been used for decades to cinematic high frame rate will take time.

現在轉向我們的 TrueCut Motion 平台的更新。正如我們自推出以來一直與投資者溝通的那樣，TrueCut Motion 是一個完整的生態系統，而不是一個獨立的解決方案。我們繼續從頭開始構建這個生態系統。將技術創新從已經使用了幾十年的每秒 24 幀推進到電影般的高幀率需要時間。

We've discussed several of the reasons for this in the past. However, over the past 6 months, our TrueCut Motion grading technology has been an integral part of how the biggest movies are shown in premium large format theaters. Starting with the rerelease of Avatar in late last year and then followed by Disney's global theatrical release of James Cameron's The Way of the Water in December, and then 20th Century Studios' rerelease of Titanic in February. James Cameron has truly awaken the industry to what's possible.

過去我們已經討論了造成這種情況的幾個原因。然而，在過去的 6 個月裡，我們的 TrueCut Motion 分級技術已經成為大型電影在優質大型影院中放映的不可或缺的一部分。從去年底重新上映的《阿凡達》開始，接著是迪士尼於 12 月在全球上映的詹姆斯·卡梅隆的《水之道》，然後是 20 世紀工作室在 2 月重新上映的《泰坦尼克號》。詹姆斯卡梅隆真正喚醒了這個行業的可能性。

In addition to each of these titles being released to theaters in 4K, HDR and 3D, they all featured cinematic high frame rate enabled by Pixelworks' TrueCut Motion platform. These films represent 3 of the 4 highest grossing box office films of all time, which is indicative of the high level of interest and consumer acceptance of true cinematic realism. The incredible global success of these titles has also resulted in increased demand from industry participants for additional premium large-screen format content.

除了以 4K、HDR 和 3D 格式在影院上映的每部影片之外，它們都具有由 Pixelworks 的 TrueCut Motion 平台支持的電影級高幀率。這些電影代表了有史以來票房收入最高的 4 部影片中的 3 部，這表明消費者對真正的電影現實主義有著高度的興趣和接受度。這些遊戲在全球取得了令人難以置信的成功，也導致行業參與者對額外的優質大屏幕格式內容的需求增加。

Today, TrueCut remains the only end-to-end high frame rate solution validated by Hollywood and with the proven capability to deliver cinematic high frame rate to any screen and has led to a significant increase in inbound engagement from ecosystem participants.

如今，TrueCut 仍然是唯一經過好萊塢驗證的端到端高幀率解決方案，並且具有向任何屏幕提供電影級高幀率的成熟能力，並顯著增加了生態系統參與者的入站參與度。

As discussed on previous conference calls, we continue to focus on establishing TrueCut Motion in the global home entertainment ecosystem. A unique and proven video experience is becoming increasingly important to streaming service providers as they look to add higher tier subscriptions that offer superior content that recreates the premium cinematic experience that they enjoy in today's state-of-the-art theaters. We believe the initial commercial success and high level of engagement from leaders in the motion picture industry represents an early glimpse into the significant opportunity that lies ahead for our TrueCut Motion solution.

正如之前的電話會議所討論的那樣，我們將繼續專注於在全球家庭娛樂生態系統中建立 TrueCut Motion。獨特且經過驗證的視頻體驗對於流媒體服務提供商來說變得越來越重要，因為他們希望增加更高級別的訂閱，以提供優質的內容，重現他們在當今最先進的影院中享受的優質電影體驗。我們相信，最初的商業成功和電影行業領導者的高度參與代表了我們對 TrueCut Motion 解決方案未來重大機遇的早期一瞥。

Shifting to home and enterprise market. As anticipated, revenue declined in the quarter with weaker demand primarily reflecting typical first quarter seasonality as Japanese OEMs managed down their inventory prior to the fiscal year-end. Following the extended period of constrained supply for key projector components throughout late all of last year, projector customers have generally indicated incremental improvement in their supply chains. With that said, we currently expect it will take projector OEMs through at least the second quarter to more fully address remaining supply and demand imbalances.

轉向家庭和企業市場。正如預期的那樣，本季度收入下降，需求疲軟主要反映了典型的第一季度季節性，因為日本原始設備製造商在財政年度結束前管理庫存。在去年年底關鍵投影儀組件的供應受限期延長之後，投影儀客戶普遍表示他們的供應鏈正在逐步改善。話雖如此，我們目前預計投影機 OEM 至少要到第二季度才能更充分地解決剩餘的供需失衡問題。

Also, I'm pleased to report that the codevelopment project continues to progress well and remains on track. In fact, we expect to deliver initial samples of this next-generation SoC during the current quarter, triggering the next milestone payment and associated credit to R&D. Once released to production toward the end of this year, we expect this new SoC to become a major revenue driver within the projector business beginning in 2024 and continue through the latter part of this decade.

此外，我很高興地報告，共同開發項目繼續進展順利，並保持在正軌上。事實上，我們預計在本季度交付這種下一代 SoC 的初始樣品，觸發下一個里程碑付款和相關的研發信貸。一旦在今年年底投入生產，我們預計這款新的 SoC 將從 2024 年開始成為投影儀業務的主要收入驅動力，並持續到本十年的後半期。

Another highlight in the quarter that merits mentioning is our successful closing in February of the previously announced strategic investment in our Pixelworks Shanghai subsidiary. As a reminder, this transaction exchanged roughly 3% equity interest in the subsidiary and an implied valuation of more than $500 million. Following the strategic investment, Pixelworks, Inc. continues to hold a majority equity interest of approximately 78%, and the proceeds from the transaction are reflected in our quarter end cash balance of $62.8 million. In addition to helping support our broader ongoing growth initiatives, the strategic investments we secured have also served to properly capitalize Pixelworks Shanghai as we continue preparations for a public local listing on the STAR exchange in China.

本季度另一個值得一提的亮點是我們在 2 月份成功完成了之前宣布的對 Pixelworks 上海子公司的戰略投資。提醒一下，這筆交易交換了該子公司大約 3% 的股權和超過 5 億美元的隱含估值。完成戰略投資後，Pixelworks, Inc. 繼續持有約 78% 的多數股權，交易收益反映在我們 6280 萬美元的季度末現金餘額中。除了幫助支持我們更廣泛的持續增長計劃外，我們獲得的戰略投資還有助於適當地利用 Pixelworks Shanghai，因為我們繼續準備在中國的 STAR 交易所上市。

As an update on where we are in this multiphase process, I'm thrilled to report that we recently retained the #1 investment bank in China, CITIC Securities. CITIC has extensive expertise with listings on the STAR Exchange, and they will serve as an important partner through the remainder of the application and underwriting process. We currently expect our Pixelworks Shanghai subsidiary to begin the formal tutoring process during the current quarter.

作為我們在這個多階段過程中的最新進展，我很高興地報告我們最近保留了中國排名第一的投資銀行中信證券。中信在科創板上市方面擁有豐富的專業知識，他們將在餘下的申請和承銷流程中充當重要的合作夥伴。我們目前預計我們的 Pixelworks 上海子公司將在本季度開始正式的輔導過程。

In conclusion, I am proud of the team's diligent work to efficiently manage through the impacts of the macro and end market-specific headwinds during the quarter. Our prudent management of inventory has positioned us to rebound faster than many of our industry peers. And today, our bookings fully support strong sequential revenue growth in mobile, and we are also seeing the initial improvement in order patterns in the projector market.

總之，我為團隊在本季度通過宏觀和終端市場特定逆風的影響有效管理的辛勤工作感到自豪。我們審慎的庫存管理使我們比許多同行更快地反彈。而今天，我們的預訂完全支持移動領域強勁的連續收入增長，我們也看到投影儀市場訂單模式的初步改善。

Acknowledging there remains uncertainty in the global economy, we are feeling increasingly optimistic about the balance of the year. We are well capitalized to continue executing on our growth initiatives while maintaining our focus on an aggressive new product road map as well as expanded ecosystems for both advanced mobile gaming and TrueCut Motion platform.

承認全球經濟仍然存在不確定性，我們對今年的餘額感到越來越樂觀。我們有充足的資金繼續執行我們的增長計劃，同時繼續專注於積極的新產品路線圖以及為高級移動遊戲和 TrueCut Motion 平台擴展的生態系統。

With that said, I'll hand the call to Haley to review financials and provide our guidance for the second quarter.

話雖如此，我會把電話轉給海莉，讓她審查財務狀況並為第二季度提供指導。

Thank you, Todd. Revenue for the first quarter of 2023 was $10 million, in line with the midpoint of our guidance. The sequential and year-over-year decline was driven by lower demand in mobile related to the industry-wide inventory correction in smartphones, combined with historical first quarter seasonality in the projector market. Additionally, as anticipated, video delivery revenue declined sequentially following higher sales of certain end-of-life products during the fourth quarter.

謝謝你，托德。 2023 年第一季度的收入為 1000 萬美元，符合我們指引的中點。連續和同比下降的原因是與智能手機行業範圍內的庫存調整相關的移動需求下降，以及投影儀市場歷史上第一季度的季節性。此外，正如預期的那樣，在第四季度某些報廢產品的銷售額增加後，視頻傳輸收入連續下降。

The resulting breakdown of revenue in the first quarter was as follows: Revenue from mobile was approximately $3.3 million. Home and enterprise revenue was approximately $6.7 million. As a reminder, home and enterprise now reflects the combination of revenue from projector and video delivery end markets. Projector accounted for approximately 90% of home and enterprise revenue in the first quarter, and we expect it to continue to represent a majority of home and enterprise revenue in future quarters.

第一季度的收入明細如下： 來自移動的收入約為 330 萬美元。家庭和企業收入約為 670 萬美元。提醒一下，家庭和企業現在反映了投影儀和視頻傳輸終端市場的收入組合。投影儀在第一季度約佔家庭和企業收入的 90%，我們預計它在未來幾個季度將繼續佔家庭和企業收入的大部分。

Non-GAAP gross profit margin was 44.1% in the first quarter of 2023 compared to 53.3% in the fourth quarter of 2022 and compared to 53.2% in the first quarter of 2022. Gross margin for the quarter reflected a combination of product mix and reduced absorption rate associated with lower revenue.

2023 年第一季度非美國通用會計準則毛利率為 44.1%，2022 年第四季度為 53.3%，2022 年第一季度為 53.2%。與較低收入相關的吸收率。

Non-GAAP operating expenses were $13.6 million in the first quarter compared to $10.8 million last quarter and $11.6 million in the first quarter of 2022. As a reminder, operating expenses in the fourth quarter benefited from a $2.5 million credit to R&D related to our codevelopment project. Excluding this credit, first quarter operating expenses were largely consistent with the OpEx level in the fourth quarter of 2022.

第一季度的非美國通用會計準則運營費用為 1360 萬美元，上一季度為 1080 萬美元，2022 年第一季度為 1160 萬美元。提醒一下，第四季度的運營費用得益於與我們共同開發相關的研發信貸 250 萬美元項目。不計入此項，第一季度運營支出與 2022 年第四季度的運營支出水平基本一致。

On a non-GAAP basis, first quarter 2023 net loss was $8.2 million or a loss of $0.15 per share compared to a net loss of approximately $800,000 or a loss of $0.01 per share in the prior quarter, and a net loss of $3.5 million or a loss of $0.06 per share in the first quarter of 2022.

按非公認會計原則計算，2023 年第一季度淨虧損為 820 萬美元或每股虧損 0.15 美元，而上一季度淨虧損約為 800,000 美元或每股虧損 0.01 美元，淨虧損為 350 萬美元或每股虧損2022 年第一季度每股虧損 0.06 美元。

Adjusted EBITDA for the first quarter of 2023 was a negative $7.8 million compared to a negative $1 million last quarter and a negative $2.2 million in the first quarter of 2022.

2023 年第一季度調整後的 EBITDA 為負 780 萬美元，上一季度為負 100 萬美元，2022 年第一季度為負 220 萬美元。

Turning to the balance sheet. We ended the quarter with cash and cash equivalents of $62.8 million. As discussed on our last conference call and as Todd just mentioned, during the first quarter, we closed the previously announced sale of equity interest in our Shanghai subsidiary, which was the primary contributor to the increased cash balance at quarter end. In addition to cash used from operations, a portion of the cash proceeds from the transaction were offset by the purchase of 2 mask sets during the quarter.

轉向資產負債表。本季度末，我們的現金和現金等價物為 6280 萬美元。正如我們在上次電話會議上所討論的以及托德剛才提到的那樣，在第一季度，我們完成了之前宣布的上海子公司股權出售，這是季度末現金餘額增加的主要原因。除了運營中使用的現金外，該交易的部分現金收益被本季度購買 2 套口罩所抵消。

Shifting to our current expectations and guidance for the second quarter of 2023. Based on current order trends and backlog, we anticipate second quarter total revenue to be in a range of between $12.5 million and $14.5 million. At the midpoint of this range, total revenue would represent sequential growth of approximately 35%, led by an anticipated increase in sales of ICs into the mobile market.

轉向我們目前對 2023 年第二季度的預期和指導。根據當前的訂單趨勢和積壓情況，我們預計第二季度總收入將在 1250 萬美元至 1450 萬美元之間。在此範圍的中點，總收入將實現約 35% 的環比增長，這主要得益於移動市場 IC 銷售額的預期增長。

Non-GAAP gross profit margin in the second quarter is expected to be between 40% and 42%. This gross margin range reflects anticipated product mix, including higher revenue contribution from mobile. Additionally, the lower than historical gross margin levels in the first half of 2023 reflects previous increases in cost of materials, a portion of which we chose not to immediately pass through to mobile customers during a period of weaker demand associated with the inventory correction in smartphones.

第二季度的非美國通用會計準則毛利率預計在 40% 至 42% 之間。這一毛利率範圍反映了預期的產品組合，包括來自移動設備的更高收入貢獻。此外，2023 年上半年低於歷史的毛利率水平反映了之前材料成本的增加，其中一部分我們選擇在智能手機庫存調整相關的需求疲軟時期不立即轉嫁給移動客戶.

As demand and unit sales of ICs increased in the second half of 2023, we expect to pass through incrementally higher material cost to customers, resulting in improved gross margins, particularly in mobile. We continue to target gross margins returning to levels near 50%.

隨著 IC 的需求和單位銷售額在 2023 年下半年增加，我們預計將逐漸增加的材料成本轉嫁給客戶，從而提高毛利率，尤其是在移動領域。我們繼續將毛利率目標定為接近 50% 的水平。

We expect operating expenses in the second quarter to range between $11 million and $12 million on a non-GAAP basis. This range reflects our expectation to achieve another planned milestone related to our codevelopment agreement. As with previous treatment, the milestone payment will be recognized as a credit to R&D, reducing our anticipated reporting -- reported operating expenses for the second quarter. Lastly, we expect second quarter non-GAAP EPS to range between a loss of $0.08 per share and a loss of $0.12 per share.

我們預計第二季度的運營費用在非 GAAP 基礎上介於 1100 萬美元和 1200 萬美元之間。這一範圍反映了我們對實現與共同開發協議相關的另一個計劃里程碑的期望。與之前的處理方式一樣，里程碑付款將被確認為研發的功勞，從而減少我們預期的報告——報告的第二季度運營支出。最後，我們預計第二季度非 GAAP 每股收益介於每股虧損 0.08 美元和每股虧損 0.12 美元之間。

That completes our prepared remarks, and we look forward to taking your questions. Operator, please proceed with the Q&A session.

我們準備好的發言到此結束，我們期待著回答您的問題。接線員，請繼續進行問答環節。

(Operator Instructions) Our first question comes from the line of Rajvi Gill with Needham.

（操作員說明）我們的第一個問題來自 Rajvi Gill 和 Needham 的對話。

Congrats on really good momentum in your business. In the mobile phone market for second quarter and kind of what you're seeing throughout the year, Todd, you're bucking a lot of the trends that you're seeing in the China handset market, and what a lot of suppliers have been indicating that the correction is steeper and the recovery in the China handset market is going to take longer than expected. You guys are really bucking that trend.

祝賀您的業務發展勢頭良好。在第二季度的手機市場以及你在全年看到的情況，托德，你正在逆勢而行，你在中國手機市場看到了很多趨勢，很多供應商一直在逆勢而行表明調整幅度更大，中國手機市場的複蘇將需要比預期更長的時間。你們真的在逆勢而行。

So I guess my first question is, one, you have managed your channel inventory pretty effectively the last couple of quarters. Maybe you could talk a little bit about that in terms of where your channel inventory is. And then in terms of the rebound that you're seeing in Europe with your customers, can you talk about where the inventory levels are that the customers are sitting on and just clarity on kind of how you're able to kind of divert from those trends?

所以我想我的第一個問題是，一個，你在過去幾個季度非常有效地管理了你的渠道庫存。也許您可以就您的渠道庫存位置談一談。然後就您在歐洲與客戶一起看到的反彈而言，您能否談談客戶所處的庫存水平以及您如何能夠轉移這些庫存水平趨勢？

Yes. Sure. Thanks, Rajvi. So overall channel inventory, we went into the start of Q1 when we guided down significantly. We went in. It would probably be all of Q1 and some of Q2 in the channel for whatever we were projecting for mobile. By February, I was -- for the month of (inaudible) there, it became clear to me that the new programs that we were included in were ramping much harder than I anticipated. And so it became clear that we would burn through that inventory sometime in probably April. So we started while I was there in February ramping up new orders to our supply chain through both our foundry and assembly and test.

是的。當然。謝謝，拉吉維。所以整體渠道庫存，當我們大幅下調時，我們進入了第一季度的開始。我們進去了。無論我們為移動設備預測什麼，它可能都是第一季度和第二季度的一部分。到 2 月，我在那裡的（聽不清）月份，我很清楚我們參與的新計劃比我預期的要難得多。因此很明顯，我們可能會在 4 月的某個時候耗盡該庫存。因此，當我 2 月份在那裡時，我們開始通過我們的代工廠、組裝和測試向我們的供應鏈增加新訂單。

The good news is because we're bucking the trend, getting access in short term to capacity was not a challenge this particular time, right? But even with that, going into March, those programs were doing better than forecasted. Customers were trying to expedite what we had in WIP. They had ran through inventory and then needed to expedite what we had in WIP. And so we have multiple Tier 1s for multiple programs simultaneously for both X5 and X7 that we're paying expedite fees for us to get that product through our foundry quicker than anticipated.

好消息是因為我們逆勢而上，在短期內獲得容量並不是這個特定時間的挑戰，對吧？但即便如此，進入 3 月，這些項目的表現仍好於預期。客戶試圖加快我們在 WIP 中的工作。他們檢查了庫存，然後需要加快我們在 WIP 中的工作。因此，我們同時為 X5 和 X7 的多個程序提供了多個一級供應商，我們正在為我們支付加急費用，以便比預期更快地通過我們的鑄造廠獲得該產品。

So today, the channel is lean, to say the least. With the guidance we gave you, we could probably beat the midpoint if we get expedited wafers quicker than we anticipate, which will be a challenge. So that demand pool is exceeding through into Q3. It's probably too early to -- I mean we have new models being launched in the second half of the year that will add to these models. So we're optimistic, but I want to see if that sticks through with the consumers and how China comes back. But right now, we're pretty optimistic.

所以今天，至少可以說，渠道很精簡。根據我們給你的指導，如果我們比預期更快地獲得加急晶圓，我們可能會超過中點，這將是一個挑戰。因此，需求池已經超過了第三季度。現在可能還為時過早 - 我的意思是我們將在今年下半年推出新模型，這些新模型將添加到這些模型中。所以我們很樂觀，但我想看看這是否會影響消費者，以及中國如何回歸。但現在，我們非常樂觀。

And for my follow-up, the gross margins, you kind of talked a little bit about some of the puts and takes in the near term. Now that you're seeing a pickup in X7, which have higher ASPs, I'm just curious how you're thinking about the pricing environment over the next couple of quarters.

對於我的後續行動，毛利率，你在短期內談到了一些看跌期權和收益。既然你看到 X7 的價格更高，它的平均售價更高，我很好奇你如何看待未來幾個季度的定價環境。

Good question. So we -- X7 does have a higher ASP but has a bunch of new features and definitely is a larger die than X5. And where we priced it, even though it's a higher ASP, it has a lower margin profile than X5 when we kept it that way on purpose to try to increase adoption of it.

好問題。所以我們 - X7 確實具有更高的 ASP，但具有許多新功能，並且絕對比 X5 更大。在我們為它定價的地方，即使它的 ASP 更高，當我們故意保持這種方式以嘗試增加它的採用時，它的利潤率低於 X5。

When we originally priced it, we expected the price increases from the supply chain to abate. I think it's well known out there that they have not fully abated. And there were some new price increases that got extended into '23 through the supply chain. We are no longer absorbing those. So we are now passing through price increases to all of our customers in all of our markets for the -- starting in the second half of this year.

當我們最初對其定價時，我們預計供應鏈的價格上漲會減弱。我認為眾所周知，它們還沒有完全減弱。並且有一些新的價格上漲通過供應鏈延伸到'23。我們不再吸收那些。因此，從今年下半年開始，我們現在正在將價格上漲傳遞給我們所有市場的所有客戶。

(Operator Instructions) Our next question comes from Suji Desilva with ROTH Capital.

（操作員說明）我們的下一個問題來自 ROTH Capital 的 Suji Desilva。

These new smartphone programs, some of these -- were these paused, Todd, during the lockdowns? And are they resuming now? And I presume some of the newer programs, that they are coming back. They sound like, from what you said, they're coming back fairly aggressively. Are they more for the X7? Or is it a mix of the 2?

這些新的智能手機程序，其中一些——在封鎖期間是否暫停了，托德？他們現在恢復了嗎？而且我認為一些較新的程序會回來。從你所說的來看，他們聽起來像是在相當積極地回歸。它們更適合 X7 嗎？或者是兩者的混合？

It was a mix of the 2. I mean -- so when we went out of '22 with inventory, there was some X7 inventory in the channel, but it was -- if you look at the channel and the customers, it was predominantly X5. I thought, for sure, it would take us 6 to 8 months to burn through the X5 inventory. Some of the expedites are on X5 devices. So some of the phones that I just mentioned, and I mentioned which ones that included X5, they had such strong demand for those models, they went through our excess inventory of X5 and are expediting new wafer starts. And then same with X7. Some of the models were X7. The demand was high, and they went through our inventory and now are expediting wafers through the line.

這是 2 的混合。我的意思是 - 所以當我們離開 22 年的庫存時，渠道中有一些 X7 庫存，但它是 - 如果你看看渠道和客戶，它主要是X5。我想，我們肯定需要 6 到 8 個月才能用完 X5 庫存。一些加速在 X5 設備上進行。所以我剛才提到的一些手機，我提到了哪些包括 X5，他們對這些型號有如此強烈的需求，他們經歷了我們 X5 的過剩庫存，並正在加快新晶圓的啟動。然後與X7相同。其中一些型號是 X7。需求很高，他們檢查了我們的庫存，現在正在通過生產線加快晶片。

They are all -- Suji, to be clear, all of this demand is based upon models that have been released. Yes, I want to make sure -- pretty much all the demand. It's got to be well over 95%. Our models that were released from either later part of December or early January on. So this is not like a rejuvenation of older models that burn through inventory. These are all new models. And you understand, the customers, I think, went into these new models being conservative because they had not been conservative the year prior. And in our particular case, we had 4, 5 different models that all blew through the initial forecast. And when they realized they were blowing through the forecast, we quote 26 (inaudible) these guys came in and were expediting within 8 weeks to when they needed the parts. And the closer you're in to that cycle time, the harder it is for us to expedite, the further out it easier to expedite.

他們都是——Suji，需要明確的是，所有這些需求都是基於已發布的模型。是的，我想確定——幾乎所有的需求。它必須超過95%。我們的模型是在 12 月下旬或 1 月初發布的。因此，這不像是通過庫存消耗舊模型的複興。這些都是新型號。你知道，我認為客戶進入這些新模型時是保守的，因為他們在前一年並不保守。在我們的特定案例中，我們有 4、5 個不同的模型都超過了最初的預測。當他們意識到自己超出了預測時，我們引用了 26 個（聽不清）這些人進來，並在 8 週內加快了他們需要零件的時間。你越接近那個週期時間，我們就越難加快，越遠越容易加快。

Okay. Great, Todd. And then switching over to the projector market. Just to understand, what kind of -- what's your updated view on end demand for '23 versus the typical year? I know it obviously had a headwind starting the year. I'm curious what you're expecting in terms of where that demand starts to come back into normal or not this year.

好的。太好了，托德。然後切換到投影儀市場。只是想了解一下，您對 23 年的最終需求與典型年份的最新看法是什麼？我知道從今年開始顯然有逆風。我很好奇你對今年需求開始恢復正常或不恢復正常的期望是什麼。

We don't really want to give annual guidance, but I will say that right now, we expect mobile to finish the year as a growth business year-over-year compared to '22, even with the trough we had in Q1. We still expect a projector to probably be down low double digits, just 10% to 15% for the year, right, as the correction takes through. We don't give guidance on TrueCut. I do expect us to be through any inventory correction by the end of this year on a projector. But we're expecting this back half of the year to be for mobile growth, year-over-year growth business.

我們真的不想給出年度指導，但我現在要說的是，與 22 年相比，我們預計移動業務將在今年結束時實現同比增長，即使我們在第一季度遇到了低谷。我們仍然預計投影機的價格可能會下降兩位數，今年只有 10% 到 15%，對吧，隨著調整的進行。我們不提供有關 TrueCut 的指導。我確實希望我們在今年年底前完成投影儀的任何庫存修正。但我們預計今年下半年將用於移動增長，同比增長業務。

Our next question comes from Richard Shannon with Craig Hallum.

我們的下一個問題來自理查德香農和克雷格哈勒姆。

I got in a little late and I may have missed some comments here, so apologies for redoing some of this. But I just want to make sure I understand on the guidance for the second quarter about the moving pieces here. Wasn't clear to me whether you expected any growth within the home and enterprise bucket, whether that includes any last-time buys or is all of it comes from mobile.

我來晚了一點，我可能錯過了這裡的一些評論，所以很抱歉重做其中的一些。但我只想確保我了解第二季度關於此處移動部分的指導。我不清楚您是否期望家庭和企業領域的任何增長，無論是包括任何最後一次購買還是全部來自移動。

No, no last-time buy. The last-time buys we had on the transcoding products finished up in the fourth quarter of '22. And we expect overall home and enterprise, which is projector and transcoding, to be slightly, slightly up from Q1, so sequentially up. And then we expect mobile to be significantly up.

不，沒有最後一次購買。我們對轉碼產品的最後一次購買是在 2022 年第四季度完成的。我們預計整個家庭和企業，即投影儀和轉碼，比第一季度略有上升，因此依次上升。然後我們預計移動會顯著上升。

Okay. And if I'm running my model here, Todd, almost in real time here, it seems like that's getting close to kind of doubling [to fluctuate it]. Is that about right?

好的。如果我在這裡運行我的模型，托德，在這裡幾乎是實時的，它似乎接近於加倍 [to fluctuate it]。這樣說對嗎？

That is about right.

這是對的。

Okay. I might come back to that in a second here. I want to hit a couple of other topics here, specifically on gross margins. I think your number for the year, which I think makes sense here without passing through the cost, but as we think about your passing those through, I'm not sure what kind of pace you're thinking of. But what kind of number could we think if you were trying to adjust this quarter for price increases? What could be key? Is it a couple of points or a few points?

好的。我可能會在一秒鐘內回到這一點。我想在這裡討論其他幾個話題，特別是關於毛利率的話題。我認為你今年的數字，我認為這在不考慮成本的情況下是有意義的，但當我們考慮你通過這些時，我不確定你在想什麼樣的速度。但是，如果您試圖調整本季度的價格上漲，我們會想到什麼樣的數字？什麼可能是關鍵？是幾分還是幾分？

Well, the Q2, we guided -- and the reason we're guiding to a low margin is we get plenty of lead time to our price increases to our customers. So there are no price increases loaded into the Q2 numbers. So that growth is all unit growth. Q3 and Q4, we're passing on price increases across the board to all markets, all customers, various different levels.

那麼，第二季度，我們指導 - 我們指導低利潤率的原因是我們有足夠的準備時間來提高我們對客戶的價格。因此，第二季度的數字中沒有價格上漲。所以增長都是單位增長。第三季度和第四季度，我們將價格上漲全面傳遞給所有市場、所有客戶、各個不同級別。

Depending on the mix, we're trying to get back. There's 2 things happening. One, our mix is more mobile-centric, okay? And it probably will be on a go-forward basis for the foreseeable future. That's going to be just a much faster-growing business than projector in home and entertainment. But we didn't pass through all the price increases that we absorbed or continue to absorb, and we are now doing that.

根據混合情況，我們正在努力恢復。有兩件事正在發生。第一，我們的組合更以移動為中心，好嗎？在可預見的未來，它可能會繼續前進。這將是一個比家庭和娛樂領域的投影儀增長更快的業務。但我們並沒有通過我們吸收或繼續吸收的所有價格上漲，我們現在正在這樣做。

Now with the goal that we get back -- if we get back to a reasonable mix, it's still going to be more mobile-centric that we get back above a 50% corporate-level gross margin with the higher mobile mix. We are still not modeling in any of this significant TrueCut revenue. TrueCut is a licensing business. Once this kicks in, we will readvise to all the analysts what the corporate goals for our margin are, but they're significantly higher than low 50s.

現在我們的目標是回歸——如果我們回到合理的組合，它仍然會更加以移動為中心，我們將通過更高的移動組合回到 50% 以上的企業級毛利率。我們仍然沒有在任何這一重要的 TrueCut 收入中建模。 TrueCut 是一項許可業務。一旦開始，我們將向所有分析師重新告知我們利潤率的公司目標是什麼，但它們明顯高於低 50 年代。

One last question for me, I'll jump out of line, Todd. Obviously, you had a lot of nice milestones and events in your TrueCut business last year. And you've been clear this is a long process developing an ecosystem. So assuming you sign up a streaming customer at any point in time, I'm not trying to apply a time frame to this, but assuming you do that, what kind of milestones would you expect to be able to announce? I don't know with the streaming customer maybe before that with other ecosystem partners to make this a reality.

最後一個問題，托德，我會跳出界線。顯然，去年您在 TrueCut 業務中有很多不錯的里程碑和事件。你已經清楚這是一個開發生態系統的漫長過程。因此，假設您在任何時間點註冊了一個流媒體客戶，我並不是要為此應用一個時間框架，但假設您這樣做了，您希望能夠宣布什麼樣的里程碑？我不知道流媒體客戶可能在此之前與其他生態系統合作夥伴一起實現這一目標。

So that's a good question. I think that's good for any investors that are listening on the call to say how do you keep an eye and see if we're hitting our milestones, given that we're not putting financial milestones in there? I would suggest that we are getting interest, strong interest in helping other studios deliver high frame rate to premium large-format theaters around the world with new releases. So you probably will hear some of that activity sooner than later. I think if people monitor us and see more content partners using our technology to deliver a better experience, I think that's a telling tale.

所以這是一個很好的問題。我認為這對任何正在聽電話的投資者來說都是好事，因為我們沒有把財務里程碑放在那裡，你如何密切關注我們是否達到了我們的里程碑？我建議我們對幫助其他工作室通過新版本向世界各地的優質大型影院提供高幀率產生興趣，強烈興趣。所以你可能遲早會聽到一些這樣的活動。我認為，如果人們監視我們並看到更多的內容合作夥伴使用我們的技術來提供更好的體驗，我認為這是一個有說服力的故事。

Upon announcing our first distribution partner streaming company, to then want to deliver this premium format content to the home and entertainment world, you will quickly see us announce partnerships with device manufacturers that are on the other end of that home entertainment delivery. I think once you see that, that's 0 to 1. Then the next question is, does it expand beyond that first major distributor and those device partners and multiply the multiple streaming companies and multiple device partners? So that's how you -- it rolled out, I think.

在宣布我們的第一個分銷合作夥伴流媒體公司之後，為了向家庭和娛樂世界提供這種優質格式的內容，您很快就會看到我們宣布與家庭娛樂傳輸另一端的設備製造商建立合作夥伴關係。我想一旦你看到了，那就是 0 到 1。那麼下一個問題是，它是否擴展到第一個主要分銷商和那些設備合作夥伴之外，並增加多個流媒體公司和多個設備合作夥伴？所以這就是你 - 它推出的方式，我想。

That concludes today's question-and-answer session. I'd like to turn the call back to management for closing remarks.

今天的問答環節到此結束。我想將電話轉回管理層以作結束語。

For those of you attending today's call, thank you for your time. I hope it was helpful. Look forward to giving you updates as the year progresses.

感謝你們參加今天的電話會議。希望對您有所幫助。隨著時間的推移，期待為您提供更新。

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

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。