Pixelworks Inc (PXLW) 2024 Q1 法說會逐字稿

Good day, ladies and gentlemen, and welcome to Pixelworks Inc's first-quarter 2024 earnings conference call. I will be your operator for today's call. And as a reminder, this conference call is being recorded for replay purposes.

女士們先生們，美好的一天，歡迎參加 Pixelworks Inc 的 2024 年第一季財報電話會議。我將擔任您今天通話的接線生。謹此提醒，本次電話會議正在錄音以供重播之用。

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

我現在想將電話轉給謝爾頓集團投資者關係部門的布雷特·佩里 (Brett Perry)。請繼續。

Good afternoon, and thank you for 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 2024.

下午好，感謝您參加今天的電話會議。與我一起參加電話會議的有 Pixelworks 總裁兼執行長 Todd DeBonis；財務長 Haley Aman。今天召開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，公佈該公司 2024 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 this call, including those about our projected future financial results, economic, and market trends, and our 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.

在開始之前，我想提醒您，我們在本次電話會議上發表的各種言論，包括有關我們預計的未來財務業績、經濟和市場趨勢以及我們的競爭地位的言論均構成前瞻性陳述。這些前瞻性陳述以及本次電話會議中所做的所有其他非歷史事實的陳述均受到許多風險和不確定性的影響，可能導致實際結果出現重大差異。

All forward-looking statements are based on the company's beliefs as of today, Tuesday, May 14, 2024. The company undertakes no obligation to update any such statements to reflect events or circumstances occurring after today.

所有前瞻性陳述均基於本公司截至今天（2024 年 5 月 14 日星期二）的信念。

Please refer to today's press release, the company's annual report on Form 10-K for the year ended December 31, 2023, and subsequent SEC filings for a description of factors that could cause forward-looking statements to differ materially from actual results.

請參閱今天的新聞稿、本公司截至 2023 年 12 月 31 日的 10-K 表格年度報告以及隨後向 SEC 提交的文件，以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的描述。

Additionally, the company's press release and management's 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 exclude stock-based compensation expense.

此外，該公司在本次電話會議期間的新聞稿和管理層聲明將包括對公認會計準則和非公認會計準則術語中的某些措施和財務資訊的討論，包括毛利率、營運費用、淨虧損和每股淨虧損。非公認會計準則指標不包括以股票為基礎的薪資費用。

The company uses these non-GAAP measures internally to assess operating performance. We believe the non-GAAP measures provide a meaningful perspective into core operating results and underlying cash flow dynamics. We caution investors to consider these measures in addition to not as a substitute for nor superior to the company's consolidated financial results as presented in accordance with US GAAP.

本公司在內部使用這些非公認會計準則衡量標準來評估營運績效。我們認為，非公認會計準則指標為核心經營績效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，不要將其視為替代或優於公司根據美國公認會計準則提出的綜合財務表現。

Also note throughout the Company's press release and management's statements during this conference, we refer to net loss attributable to Pixelworks Inc as simply net loss.

另請注意，在本次會議期間公司的新聞稿和管理層聲明中，我們將 Pixelworks Inc. 的淨虧損簡稱為淨虧損。

For additional details, a reconciliation 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.

有關 GAAP 與非 GAAP 淨虧損以及 GAAP 淨虧損與調整後 EBITDA 的調節的更多詳細信息，請參閱該公司今天早些時候發布的新聞稿。

And with that, I'd now like to turn the call over to Pixelworks' CFO, Todd DeBonis for his opening remarks. Todd, please go ahead.

現在，我想將電話轉給 Pixelworks 的財務長 Todd DeBonis 致開幕詞。托德，請繼續。

Thank you, Brett. Good afternoon and welcome to everyone joining us on today's call. In terms of our overall results, we had a solid first quarter. As outlined in today's press release, total revenue was just above the midpoint of guidance for this anticipated March quarter seasonality, coming off record mobile revenue in the fourth quarter.

謝謝你，布雷特。下午好，歡迎大家參加今天的電話會議。就我們的整體業績而言，我們第一季的業績表現強勁。正如今天的新聞稿中所述，總收入略高於預期的三月份季度季節性指引的中點，打破了第四季度移動收入的紀錄。

Gross margin expanded nearly 600 basis points sequentially to over 50% due to a favorable shift in revenue mix towards our newer X7 Gen 2 visual processor combining efficiencies and an increase in TrueCut revenue.

由於收入結構向更新的 X7 Gen 2 視覺處理器的有利轉變，結合了效率和 TrueCut 收入的增加，毛利率連續增長了近 600 個基點，達到 50% 以上。

Together with well-managed operating expenses, we utilized minimal cash from operations during the first quarter. For a review of end markets, starting with our mobile business, as previously mentioned, mobile revenue for the quarter reflected seasonality associated with customers' launch cycles for new smartphone models.

加上管理良好的營運支出，我們在第一季使用了很少的營運現金。對於終端市場的回顧，首先從我們的行動業務開始，如前所述，本季的行動收入反映了與客戶新智慧型手機型號發布週期相關的季節性。

Year over year mobile revenue was up nearly 200% and represented a record 61% of total revenue for the first quarter. This growth was driven by increased unit shipments of our X-Series visual processors, centered on the Gen 2 mobile visual processor, and an increase in TrueCut Motion licensing, and motion grading services.

行動收入年增近 200%，佔第一季總營收的 61%，創歷史新高。這一成長的推動因素是我們的 X 系列視覺處理器（以第二代行動視覺處理器為中心）單位出貨量的增加，以及 TrueCut Motion 授權和運動分級服務的增加。

We have continued to expand and gain momentum with a higher X branded gaming experience and ecosystem, which serves to further differentiate the inherent performance of branded premium visual gaming experience that our mobile processors bring customers smart [phones]. Introduced in the second half of last year, IRX, which is short for image rendering accelerator, is an end to end ecosystem solution that we established specifically for mobile games.

我們透過更高的 X 品牌遊戲體驗和生態系統繼續擴展並獲得動力，這有助於進一步區分我們的行動處理器為客戶智慧型手機帶來的品牌優質視覺遊戲體驗的固有性能。 IRX是去年下半年推出的，IRX是影像渲染加速器的縮寫，是我們專門針對手遊建立的端到端生態系統解決方案。

The overall response and our resulting collaborations across industry leading game engines and game studios have been encouraging. Since the introduction of IRX, our work with several leading gaming studios has resulted in a total of nine IRX certified mobile games, and we've tuned our solution to optimize visual performance on over a hundred IRX qualified mobile games.

整體反應以及我們與業界領先的遊戲引擎和遊戲工作室之間的合作令人鼓舞。自從推出IRX 以來，我們與多家領先的遊戲工作室合作，總共推出了九款IRX 認證的手機遊戲，我們還調整了我們的解決方案，以優化一百多種IRX 認證手機遊戲的視覺性能。

When played on an IRX enabled smartphone incorporating our X Series visual processor, IRX certified games deliver a superior, high visual quality. This provides (technical difficulty).

當在配備了我們的 X 系列視覺處理器且支援 IRX 的智慧型手機上玩時，IRX 認證的遊戲可提供卓越的高視覺品質。這就提供了（技術難度）。

In April, we announced that Diablo Immortal, a mobile game co-developed by Blizzard Entertainment and NetEase Studios, was the latest game to incorporate our IRX rendered [visual solutions]. Based on our current pipeline of engagements with studios on new games, we are aiming to double the current number of IRX certified games by the end of this year.

四月份，我們宣布由暴雪娛樂和網易工作室聯合開發的手機遊戲《暗黑破壞神：不朽》是採用我們的 IRX 渲染[視覺解決方案]的最新遊戲。根據我們目前與工作室合作開發新遊戲的管道，我們的目標是在今年年底將目前 IRX 認證的遊戲數量增加一倍。

And among these, we expect some of the highest global ranking mobile games to soon be IRX certified. In terms of year to date, we've announced a series of newly launched smartphones incorporating our mobile visual processors.

其中，我們預計一些全球排名最高的手機遊戲很快就會獲得 IRX 認證。今年迄今為止，我們已經發布了一系列新推出的採用我們的行動視覺處理器的智慧型手機。

First, as highlighted on our last call, in early January, the OnePlus Ace 3 smartphone was the first device launched incorporating our new X7 Gen 2. Also, as a reminder, we [entered] focused on expansion beyond premium domestic models in China.

首先，正如我們在1 月初的最後一次電話會議中所強調的那樣，OnePlus Ace 3 智慧型手機是第一款採用我們全新X7 Gen 2 的設備。國產型號之外的擴張。

Our two-prong strategy includes increasing penetration of the mid to lower tier market, as well as expanded adoption in models targeting for global markets. As evidence of our initial traction in January, OnePlus launched the global version of its OnePlus 12, representing the first flagship international model to incorporate both our X7 visual processor and IRX certification.

我們的雙管齊下策略包括提高中低階市場的滲透率，以及擴大針對全球市場的模型的採用。作為我們一月份最初吸引力的證據，OnePlus 推出了 OnePlus 12 的全球版本，這是首款採用我們的 X7 視覺處理器和 IRX 認證的旗艦國際型號。

And then in April, we announced the X5 Turbo visual processor was incorporated in Vivo's new iQOO Z9 Turbo smartphone targeted at the mid tier market segment. Leveraging our X5 series processor, the iQOO Z9 Turbo features differentiated frame rate optimization as well as diverse gaming display enhancement.

然後在四月份，我們宣布 X5 Turbo 視覺處理器被整合到 Vivo 針對中階市場的新款 iQOO Z9 Turbo 智慧型手機。 iQOO Z9 Turbo搭載X5系列處理器，具有差異化的幀率最佳化以及多樣化的遊戲顯示增強功能。

Most recently, we achieved a meaningful step toward international expansion, when Transsion announced launch of its Infinix GT20 Pro smartphone, with the incorporation of our X5 series processor, Transsion became our fifth tier one mobile customer.

最近，我們在國際擴張方面邁出了有意義的一步，傳音宣布推出 Infinix GT20 Pro 智慧型手機，並採用我們的 X5 系列處理器，傳音成為我們的第五級行動客戶。

More importantly, the Infinix GT20 Pro represents the first integration of Pixelworks' visual processing technology in a sub-$350 smartphone that is primarily targeted for emerging markets outside of China.

更重要的是，Infinix GT20 Pro 代表了 Pixelworks 視覺處理技術首次整合到 350 美元以下的智慧型手機中，該智慧型手機主要針對中國以外的新興市場。

We are encouraged by these recently launched models in support of expanding our [service], as we succeed in securing additional international models and penetration of the sub-premium market, since it will further complement our core strategy, which remains focused on delivering highly differentiated, market-leading visual display performance for the mobile market.

我們對這些最近推出的支援擴展我們[服務]的型號感到鼓舞，因為我們成功地獲得了更多的國際型號並滲透到次高端市場，因為它將進一步補充我們的核心戰略，該戰略仍然專注於提供高度差異化的服務，為行動市場提供市場領先的視覺顯示效能。

With expansion of our served available market, we have the opportunity to drive higher unit volumes, accelerated ecosystem development, and more robust future growth.

隨著我們所服務的可用市場的擴大，我們有機會推動更高的銷售、加速生態系統的發展以及更強勁的未來成長。

Next, I want to cover updates on our other businesses. And then I will circle back with some additional comments about our near-term expectations for mobile, as part of our closing remarks.

接下來，我想介紹我們其他業務的最新情況。然後，我將回過頭來，作為我們閉幕詞的一部分，對我們對行動業務的近期期望進行一些補充評論。

Turning to TrueCut Motion, as highlighted on our previous conference call, in late January, we announced a multiyear agreement with Walt Disney Studios to bring a collection of TrueCut Motion-graded titles to select home entertainment devices [in the first] Apple Vision Pro.

談到TrueCut Motion，正如我們在1 月下旬的電話會議上所強調的那樣，我們宣布與華特迪士尼工作室達成一項多年協議，將一系列經過TrueCut Motion 分級的影片引入到選定的家庭娛樂裝置（第一款）Apple Vision Pro 中。

Securing Disney as our first home entertainment ecosystem partner was a significant milestone for TrueCut Motion. Today, Apple Vision Pro users can watch motion graded versions of Avatar and Avatar: The Way of the Water on both [digital Apple Vision Pro] and [Apple TV stream networks].

確保迪士尼成為我們的第一個家庭娛樂生態系統合作夥伴對 TrueCut Motion 來說是一個重要的里程碑。如今，Apple Vision Pro 用戶可以在 [數位 Apple Vision Pro] 和 [Apple TV 串流媒體網路] 上觀看《阿凡達》和《阿凡達：水之道》的動作分級版本。

In the three months since our announcement with Walt Disney Studios, three additional new titles have been released to the premium format theaters in TrueCut Motions' cinematic high frame rate format. In February, Matthew Vaughn's Argylle, which was Apple Original Films in association with Marg, was distributed globally by Universal Pictures.

自從我們與華特迪士尼工作室宣布這一消息以來的三個月內，另外三部新影片已以 TrueCut Motions 的電影高幀率格式在高級格式影院上映。 2 月，馬修沃恩 (Matthew Vaughn) 的《阿蓋爾》(Argylle) 是 Apple 與瑪格 (Marg) 合作的原創電影，由環球影業 (Universal Pictures) 在全球發行。

Then in March, DreamWorks Animation's Kung Fu Panda 4 was released by Universal Pictures in TrueCut motion format in select premium theaters. Most recently, Legendary Pictures' Godzilla x Kong: The New Empire, was released globally by Warner Brothers to select premium theaters.

隨後在 3 月份，夢工廠動畫公司的《功夫熊貓 4》由環球影業以 TrueCut 動畫格式在部分優質戲院上映。最近，傳奇影業的《哥吉拉 x 金剛：新帝國》由華納兄弟在全球精選優質戲院上映。

Additionally, in collaboration with our industry partner, Christie, in April, we demonstrated these titles and TrueCut motion format at CinemaCon in Las Vegas. Utilizing a mock theater equipped with world-class CINITY Cinema System, these demos, we see very positive response from exhibitors, and also served as further industry validation that TrueCar motion is the leading premium format.

此外，四月份，我們與業界合作夥伴科視Christie 合作，在拉斯維加斯 CinemaCon 上展示了這些影片和 TrueCut 動畫格式。利用配備世界一流 CINITY 影院系統的模擬影院，這些演示得到了參展商的非常積極的反響，也進一步證明了 TrueCar Motion 是領先的優質格式的行業驗證。

Our near-term focus remains on bringing more high-value titles to theaters in TrueCut motion format over the coming months and quarters, while also continuing to engage in prospective content distribution and consumer device ecosystem partnerships.

我們近期的重點仍然是在未來幾個月和幾個季度以 TrueCut 動畫格式向影院帶來更多高價值影片，同時繼續參與潛在的內容分發和消費設備生態系統合作夥伴關係。

Shifting to our home and enterprise business, which is predominantly comprised of our visual processor SOCs for three LCD digital projector markets, revenue was in line with our expectations and consistent with typical first quarter seasonality, reflecting the standard practice of managing down internal inventories by Japanese OEM customers in advance of their fiscal year end.

轉向我們的家庭和企業業務，主要由我們針對三個LCD 數位投影機市場的視覺處理器SOC 組成，收入符合我們的預期，並與典型的第一季季節性一致，反映了日本管理內部庫存的標準做法OEM 客戶在其財政年度結束之前。

Compared to the first quarter, home and enterprise revenue was down slightly, due to lower contribution from our legacy video delivery solutions, with sales in the projector market effectively flat year over year. As indicated by home and enterprise revenue, end market demand for digital projector has seen a rise in recent quarters.

與第一季相比，由於我們的傳統視訊傳輸解決方案的貢獻較低，家庭和企業收入略有下降，投影機市場的銷售額實際上與去年同期持平。從家庭和企業收入來看，終端市場對數位投影機的需求在最近幾季有所成長。

However, it's about several quarters and represents a challenging environment from a retention perspective, resulting in a steady consolidation of three LCD market share by the industry's leading manufacturer, and also our largest projector customer.

然而，這大約是幾個季度的時間，從保留的角度來看，這代表著一個充滿挑戰的環境，導致業界領先的製造商以及我們最大的投影機客戶穩步鞏固了三台 LCD 市場份額。

In the end, the same projected customer completed final testing and evaluation on production samples of our co-developed next generation projector SOC. I'm pleased to report that we've received acceptance on the new SOC and it will go into volume production in support of our customers' first two models during the second half of this year.

最終，同一專案客戶完成了我們共同開發的下一代投影機 SOC 生產樣品的最終測試和評估。我很高興地向大家報告，我們已經接受了新 SOC 的驗收，並將在今年下半年投入大量生產，以支援我們客戶的前兩款型號。

I want to briefly emphasize the significance of this new product milestone, while also recognizing our talented and dedicated team that made this multiyear development project a success.

我想簡單強調這個新產品里程碑的重要性，同時也認可我們才華橫溢、敬業的團隊，正是他們使這個多年的開發項目取得了成功。

Our customers' transition to the new SOC from prior generation will be gradual, as the new projector models are introduced to market. As a result, this SOC will drive revenue over the course of several years, and effectively extend the runway for our profitable projector business through the latter part of this decade.

隨著新投影機型號推向市場，我們的客戶將逐步從上一代過渡到新的 SOC。因此，該 SOC 將在未來幾年內推動收入成長，並有效地在本十年後半段為我們盈利的投影機業務拓展跑道。

Before handing the call to Haley, I want to take a minute to discuss our current outlook based on two recent developments impacting our near-term mobile business. First, our largest mobile customer over the past two quarters recently informed us of a near-term reduction in their demand compared to our previous expectations.

在打電話給 Haley 之前，我想花一點時間根據影響我們近期行動業務的兩項最新進展討論我們當前的前景。首先，過去兩個季度我們最大的行動客戶最近告訴我們，與我們先前的預期相比，他們的需求近期有所減少。

In short, this customers' had some unique sales challenges on some recently launched models that are completely unrelated to Pixelworks. Due to their slower than anticipated sell through, they're pausing orders until their current and soon to be released production models consume existing inventory. We expect this pause to extend into calendar Q3.

簡而言之，該客戶在最近推出的一些與 Pixelworks 完全無關的型號上遇到了一些獨特的銷售挑戰。由於銷售速度慢於預期，他們暫停訂單，直到當前和即將發布的生產型號消耗現有庫存。我們預計這種暫停將延續到日曆第三季。

Separately, we are experiencing a delay on the market introduction of our next-generation mobile visual processor. As alluded to in the past, we have been aggressively working on this yet to be announced new products for the last two years. It will be by far the most advanced market disruptive visual processor that Pixelworks has introduced.

另外，我們的下一代行動視覺處理器在市場上的推出也出現了延遲。正如過去所提到的，過去兩年我們一直在積極開發尚未發布的新產品。它將是 Pixelworks 推出的迄今為止最先進的市場顛覆性視覺處理器。

In addition to being our first ever processor design in TSMC's 12 nanometer LLP process, it integrates a highly advanced feature set that with the collaboration of our IRX ecosystem (technical difficulty).

除了是我們首款採用台積電 12 奈米 LLP 製程設計的處理器之外，它還整合了與我們的 IRX 生態系統協作的高度先進的功能集（技術難度）。

Our targeted timeline for releasing this next generation processor was the end of the current quarter. However, a few technical hurdles have required pushing out its production release to later in the year. As a result, we are unfortunately going to miss a couple of the customer design-in windows for new premium models in the back half of 2024 that we had previously anticipated securing.

我們發布下一代處理器的目標時間表是本季末。然而，一些技術障礙要求將其生產發布推遲到今年稍後。因此，不幸的是，我們將錯過 2024 年下半年新高端車型的幾個客戶設計窗口，而我們預計之前將獲得這些窗口。

Despite this delay, we still have multiple customers that are excited about our next [gen Z solution]. They remain engaged for incorporating it in subsequently planned models.

儘管有這樣的延遲，我們仍然有多個客戶對我們的下一代 [gen Z 解決方案] 感到興奮。他們仍然致力於將其納入隨後計劃的模型中。

While these two developments are obviously very disappointing, I want to emphasize that IRX ecosystem engagement is at an all-time high. I would also add that these expected headwinds primarily impact the timing of our previous expectations, including near term revenue, and they do not change our strategy nor out longer term growth potential.

雖然這兩項進展顯然非常令人失望，但我想強調的是，IRX 生態系統的參與度處於歷史最高水準。我還想補充一點，這些預期的阻力主要影響我們先前預期的時機，包括近期收入，它們不會改變我們的策略，也不會消除長期成長潛力。

With that said, given the anticipated short-term drawdown in revenue, we are reviewing our near-term OpEx and areas to maximize operational efficiencies.

話雖如此，考慮到預期的短期收入下降，我們正在審查我們的近期營運支出和領域，以最大限度地提高營運效率。

Apart from the current headwinds, we were very pleased with the previously discussed expansion of our two-pronged mobile strategy. And we also remain very confident in the ability of our growing IRX ecosystem to drive increased adoption of our current and future mobile visual processors.

除了目前的不利因素外，我們對先前討論的雙管齊下行動策略的擴展感到非常滿意。我們對不斷發展的 IRX 生態系統推動當前和未來行動視覺處理器採用的能力仍然非常有信心。

With that, I'll pass the call to Haley to review finance (technical difficulty).

這樣，我將把電話轉給 Haley 來審查財務（技術難度）。

Thanks, Todd. Revenue for the first quarter of 2024 was $16.1 million, which was just above the midpoint of our guidance. Year over year, total revenue for the first quarter increased 61%, driven by strong [growth].

謝謝，托德。 2024 年第一季的營收為 1,610 萬美元，略高於我們指引的中點。在強勁[成長]的推動下，第一季總營收年增 61%。

The breakdown of revenue in the first quarter was as follows. Revenue from mobile was approximately $9.8 million, or 61% of total revenue, and was comprised primarily of shipments of our X5 and X7 series of visual processors as well as revenue [positive periods to] transition to cloud adoption [for grading services] and licensing fees.

第一季的收入明細如下。來自行動裝置的收入約為 980 萬美元，佔總收入的 61%，主要包括 X5 和 X7 系列視覺處理器的出貨量以及向雲端採用[用於評分服務]和授權過渡的收入[積極時期]費用。

[Omanified] revenue was approximately $6.2 million. First quarter non-GAAP gross profit margin expanded almost 600 basis points sequentially to 50.7%, [seeing an improvement] in the fourth quarter of 2023 and compared to 44.1% in the first quarter of 2023. The sequential and year-over-year improvement in gross margin primarily reflected a higher mix of revenue from newer generation mobile visual processors, increase in TrueCut licensing revenue, as well as the benefit of manufacturing cost efficiencies with our suppliers.

[Omanified] 收入約 620 萬美元。第一季非 GAAP 毛利率季增近 600 個基點，達到 50.7%，與 2023 年第一季的 44.1% 相比，2023 年第四季[有所改善]。反映了新一代行動視覺處理器的更高收入組合、TrueCut 授權收入的增加以及我們與供應商的製造成本效率的優勢。

Non-GAAP operating expenses were $12.6 million in the first quarter compared to $12 million in the prior quarter, and $13.6 million in the first quarter of 2023. Comparing sequential quarter, fourth quarter operating expenses reflected the final credit to R&D related to the co-development with our largest projector customer.

第一季非GAAP 營運費用為1,260 萬美元，上一季為1,200 萬美元，2023 年第一季為1,360 萬美元。研發費用。

On a non-GAAP basis, first quarter 2024 net loss was $4 million, or a loss was $0.07 per share, compared to a net loss of $2.6 million are a loss of $0.05 per share in the prior quarter, and a net loss of $8.2 million or a loss of $0.15 per share in the first quarter of 2022. Adjusted EBITDA in the first quarter of 2024 was a negative $3.2 million, compared to a negative $1.9 million in the fourth quarter of 2023, and a negative $7.8 million in the [third] quarter of 2023.

以非公認會計準則計算，2024 年第一季淨虧損為 400 萬美元，即每股虧損 0.07 美元，而上一季淨虧損為 260 萬美元，即每股虧損 0.05 美元，每股淨虧損 8.2 美元2022 年第一季每股虧損0.15 美元，即每股虧損0.15 美元。負780 萬美元。

Turning to the balance sheet. We ended the first quarter with cash and cash equivalents of $46.2 million compared to $47.5 million at the end of the fourth quarter of 2023. While the company had a small sequential decrease in cash balance, I'd like to highlight that [point forward] Shanghai subsidiary achieved positive positive cash flow from operations for the first quarter of 2024.

轉向資產負債表。第一季結束時，我們的現金和現金等價物為 4,620 萬美元，而 2023 年第四季末為 4,750 萬美元。 2024年第一季營運現金流為正。

Shifting to our current expectations and guidance for the second quarter of 2024. As Todd discussed, total revenue for the second quarter will be lower than previously anticipated, primarily a result of the near term headwinds in our mobile business.

轉向我們目前對 2024 年第二季度的預期和指導。 正如托德所討論的，第二季度的總收入將低於之前的預期，這主要是由於我們移動業務的近期不利因素。

Considering these factors and based on our existing backlog, we currently expect total revenue for the sector in a range of between $8 million and $9 million. I also want to emphasize that we believe the headwinds impacting second quarter mobile revenue are near term, and we expect to return to sequential growth in the second half of the year.

考慮到這些因素並根據我們現有的積壓訂單，我們目前預計該行業的總收入將在 800 萬至 900 萬美元之間。我還想強調的是，我們認為影響第二季行動收入的不利因素是近期的，我們預計將在下半年恢復環比成長。

In terms of gross profit margin for the second quarter, we expect gross profit margin to be between 50% and 52%. We expect operating expenses in the second quarter to range between $12.5 million and $13.5 million on a non-GAAP basis, and lastly, we expect second quarter non-GAAP to be between a loss of $0.16 per share and a loss of $0.13 per share.

從第二季的毛利率來看，我們預期毛利率在50%至52%之間。我們預計第二季的營運費用以非公認會計原則計算將在 1,250 萬美元至 1,350 萬美元之間，最後，我們預計第二季非公認會計原則每股虧損 0.16 美元至每股虧損 0.13 美元。

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

我們準備好的演講到此結束，我們期待回答您的問題。接線生，請繼續進行問答環節。

(Operator Instructions)

（操作員說明）

Suji Desilva, Roth.

蘇吉·德西爾瓦，羅斯。

Hi, Todd. Hi, Haley. Couple of questions on the mobile. First of all, on the mobile customers, just curious how much concentration there is in the $20 million the last two quarters? The customer that's having, I guess, model challenges now, and are other large customers in mobile, just to understand the concentration there?

嗨，托德。嗨，海莉。關於手機的幾個問題。首先，在行動客戶方面，我想知道過去兩季的 2,000 萬美元集中度有多少？我想，現在面臨模型挑戰的客戶，以及行動領域的其他大客戶，只是為了了解那裡的集中度嗎？

So of the $20 million in the last two quarters, a significant portion was with one large customer. We don't break out each customer because we don't want to break out too much information about the models. You know, we're still on a handful of [ROI on a] per customer basis, but we were overweight one particular customer, and that is the customer that is pulling back.

因此，在過去兩個季度的 2000 萬美元中，很大一部分是來自一個大客戶。我們不會分解每個客戶，因為我們不想分解太多有關型號的資訊。你知道，我們的每個客戶的[投資回報率]仍然很低，但我們超重了一個特定的客戶，那就是正在退出的客戶。

Okay. That's helpful color. And then on the new chip, on the pushout in the launch, is that a chip architecture issue? Is it a design issue, or software, firmware, or is it a issue with the manufacturing process? Any color there on the challenge would be helpful.

好的。這是有用的顏色。然後在新晶片上，在發佈時推出，這是晶片架構問題嗎？是設計問題，還是軟體、韌體問題，還是製造流程問題？挑戰中的任何顏色都會有幫助。

So it's not an architecture issue. I mean this is an entirely new architecture. We put several new features and functionality in the device as we were progressing to our first chip in 12 nanometer.

所以這不是架構問題。我的意思是這是一個全新的架構。隨著我們開發首款 12 奈米晶片，我們在該設備中加入了多項新功能和功能。

When you move to a new process node like this, one of the things we have is we have mixed signal analog interfaces, corporate supporting those two new process technology is always challenging.

當您轉向這樣的新製程節點時，我們擁有的一件事是我們擁有混合訊號模擬接口，支援這兩種新製程技術的企業始終具有挑戰性。

Some of the new features are taking us longer to bring up, but it's certainly not anything to do with the process, technology, or our manufacturing partner. It is design related. We got devices back, I think late April, they were in good enough shape that we actually sampled devices to customers on [May].

一些新功能需要我們更長的時間才能實現，但這肯定與流程、技術或我們的製造合作夥伴無關。這是與設計相關的。我們拿回了設備，我認為四月下旬，它們的狀態足夠好，我們實際上在[五月]向客戶提供了設備樣品。

So we wouldn't have done that if there was something architecture fundamentally wrong. But needless to say, we were already running on a tight schedule with the customers that were committed to use it in the near term. So it was already a bit of a risk.

因此，如果架構存在根本性錯誤，我們就不會這麼做。但不用說，我們已經與承諾在短期內使用它的客戶進行了緊張的合作。所以這已經是有一點風險了。

And I would say some of the challenges we have, it was just too much of a risk to engage on those models. So these are companies that put out new models every six months. And so from their perspective, risk became too high to go on the near term, and we have ample time now to bring it up for the subsequent models.

我想說的是，我們面臨的一些挑戰是，參與這些模型的風險太大了。這些公司每六個月就會推出新型號。因此，從他們的角度來看，短期內風險變得太高，而我們現在有足夠的時間為後續模型提出這一點。

Okay. Todd, appreciate the color. Thanks.

好的。托德，欣賞這個顏色。謝謝。

Nicholas Doyle, Needham.

尼古拉斯·道爾，李約瑟。

Hey guys. I guess just a couple of follow-ups on Suji's question. I guess what gives you confidence that the large customer pausing through the third quarter -- what gives you confidence that it will come back in the fourth quarter? And then also how big is the impact that you'll miss the design window for these new premium models? How are you thinking about that? Thanks.

大家好。我想只是對蘇吉的問題進行一些後續行動。我想是什麼讓您對大客戶在第三季暫停的信心 - 是什麼讓您相信它會在第四季度捲土重來？那麼，您錯過這些新高階車型的設計窗口會產生多大的影響呢？你覺得怎麼樣？謝謝。

So Nick, so first of all, (technical difficulty)

所以尼克，所以首先，（技術難度）

By saying that we're inferring that their order coverage will start to come back in partial third quarter. I do not anticipate we will be overweight one customer on a go forward basis. We've had a lot of design activity out over the last six months outside this large customer, that continues with our newest partner, Transsion, and it also continues outside of China, which is good for us.

透過這樣說，我們推斷他們的訂單覆蓋率將在第三季部分時間開始恢復。我預計我們不會在未來的基礎上增持一位客戶。在過去的六個月裡，我們在這個大客戶之外進行了大量的設計活動，我們的最新合作夥伴 Transsion 繼續進行這種活動，並且在中國境外也繼續進行，這對我們有利。

And so even though this customer will be coming back (technical difficulty) And the second question, Nick, was can you repeat the edge?

因此，即使這位客戶會回來（技術困難），第二個問題，尼克，你能重複這個邊緣嗎？

How big of an impact is it that you'll miss the design window for these premium models?

如果您錯過這些優質型號的設計窗口，會產生多大的影響？

Well, for the new device, which was very high ST, it's significant. You know, it will impact our mobile growth for this year. So we'll probably not see mobile growth this year because of that.

嗯，對於 ST 非常高的新設備來說，這意義重大。您知道，這將影響我們今年的行動業務成長。因此，今年我們可能不會看到行動業務的成長。

Okay. And then on the international expansion, what I mean, did you see any trends in the first quarter with the OnePlus Ace? And then kind of moving over to trend in their global OEM, which ties in China, but focused in these emerging markets, including Africa and the Middle East and I think Europe, where are you focused on expanding internationally and what are the biggest challenges you see there? Thanks.

好的。然後關於國際擴張，我的意思是，您在第一季看到 OnePlus Ace 有什麼趨勢嗎？然後轉向他們的全球原始設備製造商的趨勢，該趨勢與中國有聯繫，但專注於這些新興市場，包括非洲和中東，我認為歐洲，你們在哪裡專注於國際擴張，你們面臨的最大挑戰是什麼看那邊？謝謝。

Okay. So the OnePlus Ace 3 was not an international release, it was domestic-only from OnePlus. The one phone that they did put in an international market, so they put both the domestic version and their international, was their flagship their OnePlus 12. Transsion -- and by the way, to go back to OnePlus -- they still probably sell more domestically than they do internationally with [inflation].

好的。因此，OnePlus Ace 3 並不是在國際上發布的，而是 OnePlus 僅在國內發布的。他們確實投放到國際市場的一款手機，所以他們同時投放了國內版本和國際版本，這是他們的旗艦產品 OnePlus 12。比國際上的[通貨膨脹]好。

Transsion does not sell domestically. They are a [ace share] publicly-traded company [that particularly from one of the significant functional product model], they sell throughout emerging markets throughout the world. And they're and they were the fastest growing mobile phone customer by unit growth in Q1. I think they grew over 80% year over year.

傳音不在國內銷售。他們是一家[王牌股票]上市公司[特別是來自重要的功能性產品模型之一]，他們的產品銷往世界各地的新興市場。從第一季的銷售成長來看，他們現在是成長最快的手機客戶。我認為它們同比增長超過 80%。

And all of that growth is by selling phones in what I would call low to mid tier price ranges, throughout the emerging markets. So engaging with them on this design, Transsion, has been a very good thing for our international expansion.

所有這些成長都是透過在整個新興市場銷售我所說的中低價格範圍的手機來實現的。因此，與他們合作設計 Transsion，對於我們的國際擴張來說是一件非常好的事情。

When we started with them, we had modest expectations for this first model. We believe there will be more. By the time we launched the model, we've been working with them probably eight months on this model. By the time we launched the model, their forecast had tripled.

當我們開始使用它們時，我們對第一個模型抱有適度的期望。我們相信還會有更多。當我們推出該模型時，我們已經與他們在該模型上合作了大約八個月。當我們推出該模型時，他們的預測增加了兩倍。

Meaning the emerging markets they serve, there is pent-up demand for gaming centric mobile phones, and not a lot of companies have been targeting those emerging markets with these capabilities at this price point. And what we've seen is there's a strong demand for them. So let's hope that continues.

意味著他們所服務的新興市場，對以遊戲為中心的手機的需求被壓抑，並且沒有多少公司在這個價位上瞄準那些具有這些功能的新興市場。我們看到對它們的需求強勁。所以我們希望這種情況能夠持續下去。

Thanks.

謝謝。

Richard Shannon, Craig-Hallum.

理查德·香農，克雷格·哈勒姆。

Well, hi, Todd and Haley. Thanks for taking my questions here on time. Todd, maybe I'll hit on gaming and IRX. I think you talked about I know it was 100% to 200% increase in the number of games announced by the end of year. Apologies, if I missed it. My line was garbled at times. Is that the same numerical goal as what you talked about a couple of quarters ago, when you're talking about a 400% increase? I don't have the numbers in front of me to do the math, but is that the same goal?

好吧，嗨，托德和海莉。感謝您準時在這裡提出我的問題。托德，也許我會喜歡遊戲和 IRX。我想你談過，我知道到年底宣布的遊戲數量增加了 100% 到 200%。抱歉，如果我錯過了。我的線路有時會出現亂碼。這個數字目標與您幾個季度前談論的 400% 成長的數字目標相同嗎？我面前沒有數字可以進行數學計算，但這是同一個目標嗎？

It's consistent with what I think I've talked about in the past. I mean what I said in the prepared remarks is we have nine IRX certified games as of today. And our current goal is to double them by the end.

這與我認為我過去談論過的內容是一致的。我的意思是我在準備好的發言中所說的是，截至今天我們有九款經過 IRX 認證的遊戲。我們目前的目標是到最後將其翻倍。

And okay --

好吧——

I also said one other thing, Richard. I also said for the first time, I brought up something besides certified, I brought up what we call qualified. And we have over 100 IRX-qualified. The difference between certified and qualified is a certified game is we work directly with the studio, and they incorporate our game engine SDK to support their game playing on an IRX enabled phone.

我還說了另一件事，理查。我還第一次說，我提出了除了認證之外的東西，我提出了我們所謂的合格。我們擁有超過 100 個 IRX 合格產品。認證和合格之間的區別是認證遊戲是我們直接與工作室合作，他們整合了我們的遊戲引擎 SDK 以支援他們在支援 IRX 的手機上玩遊戲。

An IRX qualified again, is where we work with the phone manufacturer to make sure that game works well with our visual processor. It's more one-sided, but we do optimize the hardware to play with that game, and we qualify it. And then the OEM whitelists those games.

再次獲得 IRX 資格，是我們與手機製造商合作的地方，以確保遊戲與我們的視覺處理器配合得很好。這比較片面，但我們確實優化了玩該遊戲的硬件，並且我們對其進行了資格認證。然後 OEM 將這些遊戲列入白名單。

Today, they're we don't have any phone manufacturer that just turns on our visual processor to play with the game that somebody can download. It's a controlled environment. So it's either a whitelisted qualified IRX game, or one of our IRX certify games that we have engaged directly with the studio and collaborate.

今天，我們沒有任何手機製造商只是打開我們的視覺處理器來玩別人可以下載的遊戲。這是一個受控環境。因此，它要么是一款列入白名單的合格 IRX 遊戲，要么是我們直接與工作室合作並獲得 IRX 認證的遊戲之一。

Okay. That's helpful. And thanks for that description there, Todd. Maybe to touch on on IRX here, obviously introduced this last summer here, and that is to the degree a branding exercise. Obviously, there's a little bit of a chicken-and-egg dynamic here is establishing a brand, which clearly isn't very easy to do.

好的。這很有幫助。感謝托德的描述。也許在這裡談談 IRX，顯然是去年夏天在這裡介紹的，這在某種程度上是一個品牌推廣活動。顯然，建立品牌有點像先有雞還是先有蛋的問題，這顯然不是很容易做到的。

Maybe wanted to get your kind of qualitative scorecard on how well that has taken hold so far, and what are the things should we look for to show further entrenchment and success there?

也許想要獲得一種定性記分卡，了解迄今為止該計劃的實施情況，以及我們應該尋找哪些東西來顯示在那裡的進一步鞏固和成功？

Was that TrueCut you were asking there, Richard, or IRX?

Richard，你問的是 TrueCut 還是 IRX？

No, IRX.

不，IRX。

You know, we're trying to establish two brands.

你知道，我們正在努力建立兩個品牌。

I'm asking IRX.

我在問IRX。

Okay. I just want to make sure. So, I mean within establishing brands, how do you do it? You go out and you spend marketing dollars in making sure that that brand is recognized with the businesses that you're targeting.

好的。我只是想確定一下。那麼，我的意思是，在建立品牌方面，你是如何做到的呢？你出去花費行銷資金來確保品牌得到你所瞄準的企業的認可。

We've been able to do that. And we don't have a huge budget where I think we've done a pretty good job of people talking about IRX, given the budgets that we have. Secondly, the thing we do is we leverage our customers. So when they talk about -- sometimes they call it a dual processor architecture or they call [well at the multiprocessor] that they actually talk about it being an IRX certified processor in supporting the IRX ecosystem.

我們已經能夠做到這一點。而且我們沒有龐大的預算，我認為考慮到我們的預算，我們在人們談論 IRX 方面做得相當不錯。其次，我們所做的就是利用我們的客戶。因此，當他們談論時，有時他們稱之為雙處理器架構，或者他們稱之為[多處理器]，他們實際上談論的是支援 IRX 生態系統的 IRX 認證處理器。

Most of the customers support us in that activity. And for evidence, I suggest you go see how the Infinix GT20 phone [were trained in] how to advertise their phone, and they talk about Pixelworks. They talk about our IRX certification.

大多數客戶都支持我們的這項活動。作為證據，我建議您去看看 Infinix GT20 手機如何[接受培訓]如何宣傳他們的手機，他們談論 Pixelworks。他們談論我們的 IRX 認證。

The last thing we did is if you go look at these nine gains that are IRX certified, we've actually worked with the game manufacturer itself. So there is a setting in the user setting section that if you want to increase the performance on the output of the game, they have an IRX button in the menu of the game itself. And so that is another way for us to promote the IRX brand.

我們做的最後一件事是，如果你看看這九個經過 IRX 認證的增益，我們實際上已經與遊戲製造商本身進行了合作。因此，用戶設定部分有一個設置，如果你想提高遊戲輸出的效能，他們在遊戲本身的選單中有一個 IRX 按鈕。這是我們推廣 IRX 品牌的另一種方式。

So when you have Tencent, or NetEase, or Perfect World, actually incorporate your IRX logo and explanation of what IRX is in their game. That gives us a lot of exposure.

因此，當你擁有騰訊、網易或完美世界時，請在他們的遊戲中實際加入你的 IRX 標誌和對 IRX 的解釋。這給了我們很多曝光機會。

Okay. Thanks for that, Todd. And my last question, I can't remember who mentioned this, but just kind of thinking past second quarter here, United States, again, the comments are a bit garbled here about how to think about the second half.

好的。謝謝你，托德。我的最後一個問題，我不記得誰提到了這一點，但只是想了一下美國第二季度的情況，這裡關於如何看待下半年的評論有點混亂。

I think there was some expectation sequential growth, and I wasn't sure if that was the thought was there that would happen in third quarter or fourth quarter? Not sure. But could you clarify what your thoughts are, what you see right now?

我認為存在一些預期的連續增長，我不確定這是否會在第三季或第四季發生？沒有把握。但你能澄清一下你的想法是什麼，你現在看到了什麼嗎？

No, what we said -- I hope my answers aren't garbled. You sound perfectly clear so I don't know what's going on with that -- what we said was in the second half of the year, the Q3 would be sequential growth over Q2 and Q4 would be sequential growth over Q3.

不，我們所說的——我希望我的答案沒有亂碼。您聽起來非常清楚，所以我不知道發生了什麼 - 我們所說的是在今年下半年，第三季度將比第二季度連續增長，第四季度將比第三季度連續增長。

Okay, perfect. I certainly heard that one. (multiple speakers) Okay. Thanks for repeating that again. I didn't hear very well before. So I think that's all the questions from me. Thank you.

好的，完美。我當然聽過這件事。 （多個發言者）好的。感謝您再次重複一遍。我之前聽得不太清楚。所以我想這就是我提出的所有問題。謝謝。

Thank you.

謝謝。

Thank you. And I'm not showing any further questions in the queue. I'd like to turn it back over to management for any closing remarks.

謝謝。我不會在隊列中顯示任何其他問題。我想將其轉回管理層以供結束語。

All right. Well, thank you. Thank you for joining Pixelworks Q1 2024 earnings call. Even though the management team is disappointed in our near term guidance, we remain extremely confident in our long-term strategy as demonstrated by expanding our mobile [system] and TrueCut progress in the recent quarter.

好的。嗯，謝謝。感謝您參加 Pixelworks 2024 年第一季財報電話會議。儘管管理團隊對我們的近期指導感到失望，但我們對我們的長期策略仍然充滿信心，最近一個季度擴大我們的行動[系統]和 TrueCut 進展就證明了這一點。

Additionally, our expanded corporate gross margins demonstrate the value that our visual processing solutions bring to customers as well as our execution on cost efficiency initiatives. The team is very focused on the elements of the business we can control, and we look forward to progress over the next coming months. Thank you.

此外，我們擴大的企業毛利率證明了我們的視覺處理解決方案為客戶帶來的價值以及我們對成本效率計劃的執行。團隊非常關注我們可以控制的業務要素，我們期待在接下來的幾個月中取得進展。謝謝。

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.

感謝您參加今天的會議。這確實結束了該程式。您現在可以斷開連線。大家，祝你有美好的一天。