Pixelworks Inc (PXLW) 2025 Q1 法說會逐字稿

Good day ladies and gentlemen and welcome to the Pixelworks, Inc's first-quarter 2025 earnings conference call. I will be your operator for today's call. (Operator Instructions) As a reminder, this conference call is being recorded for replay purposes. I would like to turn the call over to Brett Perry with Shelton Group Investor Relations. Please go ahead.

女士們、先生們，大家好，歡迎參加 Pixelworks, Inc 2025 年第一季財報電話會議。我將擔任您今天電話的接線生。（操作員指示）提醒一下，本次電話會議將會被錄音以供重播。我想將電話轉給 Shelton Group 投資者關係部的 Brett Perry。請繼續。

Thank you, Kevin. Good afternoon and thank you for joining 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 2025. Before we begin, I'd like to remind you that various remarks we make on this call, including those about projected future financial results, economic and market trends, and our competitive position, constitute forward-looking statements.

謝謝你，凱文。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還有 Pixelworks 總裁兼執行長 Todd DeBonis；和財務長 Haley Aman。今天的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，宣佈公司2025年第一季度的財務業績。在我們開始之前，我想提醒您，我們在本次電話會議上所做的各種評論，包括關於預測的未來財務業績、經濟和市場趨勢以及我們的競爭地位的評論，都構成前瞻性陳述。

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. All forward-looking statements are based on the company's beliefs as of today, Tuesday, May 13, 2025. 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 company's Annual report on Form 10K for the year ended December 31, 2024, and subsequent SEC filings for a description of factors that could cause forward-looking statements to differ materially from actual results. 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 expense, net loss and net loss per share.

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大不相同。所有前瞻性陳述均基於本公司截至今天（2025 年 5 月 13 日星期二）的信念。本公司不承擔更新任何此類聲明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、本公司截至 2024 年 12 月 31 日的 10K 表年度報告以及隨後的 SEC 文件，以了解可能導致前瞻性陳述與實際結果有重大差異的因素。此外，本公司在本次電話會議中的新聞稿和管理聲明將討論 GAAP 和非 GAAP 條款中的某些指標和財務信息，包括毛利率、營業費用、淨虧損和每股淨虧損。

Non-GAAP measures exclude restructuring costs and stock-based compensation expense. The company uses these non-GAAP measures internally to assess its operating performance. We believe the 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 US-GAAP. Also note, throughout the company's press release and management statements during this conference, we'll refer to net loss attributable to Pixelworks, Inc as simply net loss.

非公認會計準則指標不包括重組成本和股票薪資費用。公司內部使用這些非公認會計準則指標來評估其營運績效。我們相信非公認會計準則指標為了解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，這些措施應作為公司根據美國公認會計準則呈現的合併財務表現的補充，而不能替代或優於這些業績。另請注意，在本次會議期間的公司新聞稿和管理聲明中，我們將把歸因於 Pixelworks, Inc 的淨虧損簡稱為淨虧損。

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

有關更多詳細資訊以及 GAAP 與非 GAAP 淨虧損以及 GAAP 淨虧損與調整後 EBITDA 的對賬，請參閱該公司今天早些時候發布的新聞稿。現在我很高興將電話轉給 Pixelworks 執行長托德。請繼續。

Thank you, Brett. Good afternoon and welcome to everyone on the phone and webcast. We appreciate you joining us for today's conference call. As reported in our press release earlier today, first quarter results were consistent with our expectations. Revenue reflected anticipated first quarter seasonality in the home and enterprise market, which was partially offset by sequential growth in our mobile business.

謝謝你，布雷特。大家下午好，歡迎大家透過電話和網路直播。感謝您參加今天的電話會議。正如我們今天早些時候的新聞稿中所報導的，第一季的業績符合我們的預期。收入反映了家庭和企業市場預期的第一季季節性，但被行動業務的連續成長部分抵消。

We also realized significant benefits from our previous and continued actions to streamline our cost structure, with first quarter operating expenses down more than $2 million year over year. Similar to the format and flow of remarks last quarter, I'll begin with comments on our TrueCut Motion business in the US and then review the development specific to our majority-owned Pixelworks Shanghai subsidiary, including an update on the strategic review process.

我們也從先前和持續採取的精簡成本結構的行動中獲得了顯著的收益，第一季的營運費用比去年同期下降了 200 多萬美元。與上個季度的評論格式和流程類似，我將首先評論我們在美國 TrueCut Motion 業務，然後回顧我們控股的 Pixelworks 上海子公司的具體發展情況，包括戰略審查流程的最新情況。

Starting with our TrueCut Motion platform. As discussed last quarter, achieving a tipping point for broader adoption and commercialization requires creating momentum across an ecosystem comprised of filmmakers, studios, content distributors and exhibitors, and device manufacturers. We continue to make tangible progress on all these strategic fronts over the last quarter.

從我們的 TrueCut Motion 平台開始。正如上個季度所討論的，要實現更廣泛採用和商業化的臨界點，需要在由電影製作人、工作室、內容分銷商和參展商以及設備製造商組成的生態系統中創造動力。上個季度，我們在所有這些策略方面繼續取得實際進展。

First, with respect to the broader film industry. For the first time since the pandemic, there are indications of an uptick in activity from filmmakers and studios. This includes a positive trajectory for both the planned number and quality of new release theatrical titles, representing a positive shift in the overall industry landscape from prolonged headwinds to a tailwind.

首先，就更廣泛的電影產業而言。自疫情爆發以來，首次出現電影製作人和電影工作室活動增加的跡象。這包括計劃發行的新影院數量和品質均呈現正面趨勢，代表整個產業格局從長期逆風轉為順風。

Specific to TrueCut Motion content we are still targeting to double the number of titles year over year from 5 in 2024 to 10 in 2025. In line with this growth in titles, we are seeing announcements of major capital investments from both or by exhibitors in both the standard and large format premium laser theaters that benefit the most from the TrueCut Motion format.

具體到 TrueCut Motion 內容，我們仍計劃將標題數量逐年翻一番，從 2024 年的 5 個增加到 2025 年的 10 個。隨著影片數量的增長，我們看到標準和大格式高級雷射影院以及影院放映商宣布將進行重大資本投資，這些影院將從 TrueCut Motion 格式中受益最多。

As of today, our exhibition EcoSystem includes over 1500 of the world's highest-grossing premium theaters. Additionally, we have maintained our focused efforts to expand the TrueCut ecosystem in support of accelerating future content growth and scaling access to Motion Grading capabilities. As evidence of our most recent progress and traction. During the corner, we formalized a strategic partnership with a market-leading post-production company. Notably, this partnership serves to bring TrueCut Motion further upstream in the larger post-production process, streamlining the accessibility of TrueCut Motion grading tools to more filmmakers.

截至今天，我們的展覽生態系統已涵蓋全球票房最高的 1500 多家優質影院。此外，我們一直致力於擴展 TrueCut 生態系統，以支援加速未來內容的成長和擴大對運動分級功能的存取。作為我們最近取得的進展和動力的證據。在此期間，我們與一家市場領先的後製公司正式建立了策略合作夥伴關係。值得注意的是，這項合作將使 TrueCut Motion 在更大的後製過程中進一步處於上游位置，從而簡化了 TrueCut Motion 分級工具對更多電影製作人的可訪問性。

As this and other partners come on board, we will scale our ability to bring filmmaker awareness of TrueCut, leading to further growth in title releases. With our collective theatrical ecosystem efforts approaching critical mass, we've begun engaging deeper discussions with targeted leading device companies to incorporate TrueCut Motion capability and certification in future devices.

隨著這個合作夥伴和其他合作夥伴的加入，我們將擴大我們的能力，讓電影製作人了解 TrueCut，從而進一步促進影片發行量的成長。隨著我們集體的戲劇生態系統努力接近臨界點，我們已經開始與目標領先的設備公司進行更深入的討論，以將 TrueCut Motion 功能和認證納入未來的設備中。

On our previous conference call, I referred to active dialogue with three major device brands. What I can share today is, we have recently completed rigorous certification testing with one of these brands, allowing us to start jointly engaging with streaming service providers. This robust demonstration of a major improvement in the user experience for film in the home validates our progress towards the end goal of bringing TrueCut Motion to the mass market via home entertainment devices.

在我們之前的電話會議中，我提到了與三大設備品牌的積極對話。今天我可以分享的是，我們最近與其中一個品牌完成了嚴格的認證測試，這使我們能夠開始與串流媒體服務提供者共同合作。這項強有力的證明極大地改善了家庭電影用戶體驗，證明了我們在透過家庭娛樂設備將 TrueCut Motion 推向大眾市場的最終目標方面取得了進展。

Turning to our Pixelworks Shanghai subsidiary which as a reminder comprises all of our semiconductor business including open market and co-developed visual display processing chips for the mobile as well as home enterprise markets. Starting with an update on the mobile business. As expected, mobile revenue increased sequentially in the first quarter, primarily reflecting shipments of visual processors in support of customers previously launched smartphone models. Driving renewed and sustained growth in mobile remains among our top priorities. We are making steady progress on the product transition to our latest visual processing solutions.

談到我們的Pixelworks上海子公司，它涵蓋了我們所有的半導體業務，包括開放市場和共同開發的用於行動和家庭企業市場的視覺顯示處理晶片。從行動業務的更新開始。正如預期的那樣，第一季行動收入環比增長，主要反映了為支援客戶之前推出的智慧型手機型號而出貨的視覺處理器。推動行動領域重新獲得持續成長仍然是我們的首要任務之一。我們正在穩步推動產品向最新視覺處理解決方案的轉型。

This includes expanding our served target market with our new low-cost mobile graphics accelerator solution for the mid and entry level smartphones. Our current focus continues to be on a co-development of capabilities with a lead mobile OEM customer on multiple programs targeted for launch later this year. Separately, we also have multiple active program engagements with additional mobile OEMs for both our X7 prime solution as well as our latest flagship mobile visual processor. Alongside our focused efforts to secure new [design-ins] for our latest visual processor solutions, we are continuing to drive innovation aimed at expanding the mobile gaming ecosystem. In April, we announced our strategic collaboration with Tencent's PerfDog, a well-established platform for performing mobile gaming testing.

這包括利用我們針對中階和入門級智慧型手機的新型低成本行動圖形加速器解決方案來擴大我們所服務的目標市場。我們目前的重點仍然是與領先的行動 OEM 客戶共同開發多個專案的功能，計劃於今年稍後推出。另外，我們也與其他行動 OEM 就我們的 X7 prime 解決方案以及我們最新的旗艦行動視覺處理器開展了多個積極的專案合作。除了我們致力於為最新的視覺處理器解決方案確保新的設計之外，我們還在繼續推動旨在擴大行動遊戲生態系統的創新。今年 4 月，我們宣布與騰訊的 PerfDog 建立策略合作關係，PerfDog 是一個成熟的行動遊戲測試平台。

The motivation behind this collaborative project was to help the gaming ecosystem overcome the specific technical challenges associated with objectively and reliably testing visual display performance across mobile devices that incorporate a dedicated visual processor. As a result, we jointly introduced the PerfDog, the Frame Generation Index -- with PerfDog the Frame Generation Index, which is a multi-dimensional framework for quantifying and evaluating mobile gaming performance. This innovative index for performance testing provides gaming and smartphone developers with precise real time data for benchmarking, enabling enhanced optimization and ultimately superior visual display performance for mobile gaming.

這項合作計畫背後的動機是幫助遊戲生態系統克服與客觀可靠地測試採用專用視覺處理器的行動裝置的視覺顯示效能相關的特定技術挑戰。因此，我們共同推出了PerfDog，即幀生成指數——PerfDog幀生成指數，這是一個用於量化和評估行動遊戲性能的多維框架。這項創新的性能測試指數為遊戲和智慧型手機開發人員提供了精確的即時基準測試數據，從而實現了增強優化並最終為行動遊戲提供了卓越的視覺顯示性能。

Shifting to our home and enterprise business which following our completed end of life shipments of transcoding products in the fourth quarter, is now exclusively comprised of our visual processor system on a chips for three LCD digital projector market. Revenue was down sequentially, consistent with the typical first quarter seasonality as Japanese OEM customers managed down internal inventories in advance of their fiscal year end.

繼第四季度完成轉碼產品的生命週期終止出貨後，我們轉向家庭和企業業務，目前該業務完全由面向三台 LCD 數位投影機市場的晶片上視覺處理器系統組成。由於日本 OEM 客戶在財政年度結束前減少了內部庫存，因此收入環比下降，與第一季的典型季節性一致。

Projector only revenue for the quarter was effectively flat year over year. Acknowledging the increasingly dynamic global macro and trade environment, we haven't seen any significant impacts on the projector market nor any change in order patterns from our large co-development customer. Barring any large global economic shifts, we continue to anticipate total projector business in '25 to look similar to 2024. Apart from our primary mobile and home enterprise businesses, I previously outlined several new adjacent revenue opportunities that our team is pursuing. Today all of these engagements remain in play with the potential to contribute meaningful upside revenue in support of our focus on driving renewed growth and paving a path to profitability.

本季投影機的營收與去年同期相比基本持平。儘管全球宏觀和貿易環境日益動態，我們並未看到投影機市場受到任何重大影響，我們的大型共同開發客戶的訂單模式也沒有任何變化。除非全球經濟發生重大變化，否則我們預計 2025 年投影機業務總量將與 2024 年類似。除了我們的主要移動和家庭企業業務之外，我之前還概述了我們的團隊正在追求的幾個新的相鄰收入機會。如今，所有這些活動仍在繼續，並有可能帶來可觀的額外收入，以支持我們專注於推動新的成長和鋪平獲利之路。

Briefly recapping these opportunities and their current status. First, we established a framework to provide ASIC design services, and we are engaged with a large international OEM to become the first customer for turnkey services as well as a potential licensing of our display IP. We are currently in advanced discussions including review and negotiation of technical details with this anticipated lead customer, and we believe this initial design services engagement could contribute meaningful revenue as soon as the third quarter. Separately, we're continuing to advance discussions with several unrelated parties to license specific intellectual property for their products. These respective license opportunities span multiple different end markets and include the potential to accelerate our efforts towards expanding the mobile gaming ecosystem.

簡要回顧這些機會及其當前狀態。首先，我們建立了一個提供 ASIC 設計服務的框架，並與一家大型國際 OEM 合作，成為交鑰匙服務的第一個客戶以及我們顯示 IP 的潛在授權。我們目前正在與這位預期的主要客戶進行深入討論，包括審查和協商技術細節，我們相信，這項初步的設計服務合作最早可在第三季帶來可觀的收入。另外，我們正在繼續與幾個不相關的方進行討論，以獲得他們產品的特定智慧財產權許可。這些各自的授權機會涵蓋多個不同的終端市場，並有可能加速我們擴大行動遊戲生態系統的努力。

Finally, we now have two different prior transcoding customers that have indicated interest in ordering our recently end-of-life transcoding chips that are no longer in production. Our team has recently confirmed that a limited production run of these legacy chips is technically feasible if initiated within a prescribed period. As such, we're prepared to accommodate one or both customers should they choose to move forward. Bringing everything together and looking at the big picture, we expected the first half to be challenging from a total revenue perspective. We proactively took a series of actions to significantly reduce our cost structure and streamline the entire organization.

最後，我們現在有兩個不同的先前轉碼客戶表示有興趣訂購我們最近停產的轉碼晶片。我們的團隊最近確認，如果在規定的時間內啟動這些傳統晶片的有限生產，在技術上是可行的。因此，如果客戶選擇繼續前進，我們準備好滿足其中一位或兩位客戶的要求。綜合考慮所有因素並縱觀全局，我們預計從總收入角度來看上半年將充滿挑戰。我們積極採取一系列措施，大幅降低成本結構，精簡整個組織。

Today we have engagements across a diverse set of primary and secondary opportunities to drive renewed top line growth. Taken together, we are well-positioned to meaningfully benefit from the upside revenue, and we continue to believe that our Pixelworks Shanghai subsidiary is poised to reach profitability in the second half of 2025. As most on this call are aware, we engaged Morgan Stanley and initiated a formal review process in the later part of 2024 after receiving inbound strategic interest in our Pixelworks Shanghai subsidiary.

今天，我們透過一系列主要和次要機會來推動新的營收成長。綜合起來，我們完全有能力從上行收入中獲得有意義的收益，並且我們仍然相信我們的Pixelworks上海子公司將在2025年下半年實現盈利。正如大多數與會者所知，在獲得 Pixelworks 上海子公司的策略性投資後，我們與摩根士丹利合作，並於 2024 年下半年啟動了正式審查程序。

Together with our financial advisor, we have since been engaged in due diligence with several qualified parties while also continuing to evaluate potential ownership and collaboration structures to determine a more optimal scenario for enhancing Pixelworks Shanghai's long term growth potential as well as maximizing value for existing shareholders. Although the outcome is yet to be determined, we believe the process itself is nearing closure and likely to result in a clear strategic direction for our Pixelworks Shanghai subsidiary within 90 days.

我們與財務顧問一起，對多家合格方進行了盡職調查，同時繼續評估潛在的所有權和合作結構，以確定更優化的方案，以增強Pixelworks上海的長期成長潛力並最大化現有股東的價值。雖然結果尚未確定，但我們相信該流程本身已接近尾聲，並可能在 90 天內為我們的 Pixelworks 上海子公司確定明確的策略方向。

In summary, we're focused on executing our strategic and operational objectives in a dynamic global macro environment. We've significantly reduced our overall cost structure and expect to realize continued benefits from a more streamlined organization. With respect to our Pixelworks Shanghai subsidiary, we're encouraged by the depth of customer engagements on smartphone programs, particularly for our new mobile graphics accelerator solution. We are also continuing to advance and expect to capitalize on multiple near-term adjacent revenue opportunities over the next several quarters. Additionally, remain committed to the path for our Pixelworks Shanghai subsidiary to reach profitability in the second half of 2025.

總之，我們專注於在動態的全球宏觀環境中執行我們的策略和營運目標。我們大幅削減了整體成本結構，並期望透過更精簡的組織持續獲益。就我們的Pixelworks上海子公司而言，我們對客戶在智慧型手機專案上的深入參與感到鼓舞，特別是對於我們的新行動圖形加速器解決方案。我們仍在繼續前進，並期望在未來幾季內利用多個近期相鄰的收入機會。此外，我們將持續致力於推動Pixelworks上海子公司在2025年下半年獲利。

With our TrueCut business, we are continuing to make inroads towards an expanded ecosystem and achieving critical mass required to bring Pixelworks' TrueCut Motion Platform to more consumers both in premium large format theaters and ultimately to home entertainment devices. With that, I'll turn the call to Haley to review financials and provide guidance for the second quarter.

憑藉我們的 TrueCut 業務，我們將繼續向擴大生態系統邁進，並達到將 Pixelworks 的 TrueCut Motion 平台帶給更多消費者（包括高端大格式影院以及最終家庭娛樂設備）所需的臨界規模。有了這些，我將把電話轉給 Haley，讓她審查財務狀況並為第二季提供指導。

Thank you, Todd. Revenue for the first quarter of 2025 was $7.1 million compared to $9.1 million in the fourth quarter and $16.1 million in the first quarter of 2024. The sequential decrease in revenue reflected a combination of anticipated first quarter seasonality in the home and enterprise market as well as the fourth quarter, including higher sales of end-of-life transcoding products. These were partially offset by sequential revenue growth in mobile in the first quarter. The breakdown of revenue in the first quarter was as follows: Home and enterprise revenue was approximately $5.8 million.

謝謝你，托德。2025 年第一季的營收為 710 萬美元，而第四季為 910 萬美元，2024 年第一季為 1,610 萬美元。收入的連續下降反映了家庭和企業市場第一季以及第四季度預期的季節性因素，包括停產轉碼產品的銷售額增加。但第一季行動業務的連續收入成長部分抵消了這一成長。第一季的收入明細如下：家庭和企業收入約為 580 萬美元。

Revenue from mobile was approximately $1.3 million. First quarter non-GAAP gross profit margin was 49.9% compared to 54.8% in the fourth quarter of 2024 and 50.7% in the first quarter of 2024. The sequential decrease in first quarter gross margin was primarily a result of the shift in product mix between our home and enterprise and mobile businesses as well as less overhead absorption. Non-GAAP operating expenses of $10.4 million in the first quarter were flat with the prior quarter, however, decreased approximately $2.2 million from $12.6 million in the first quarter of 2024. This year-over-year decrease in first quarter operating expenses reflects our previously implemented cost reduction actions through the end of 2024.

來自行動端的收入約為 130 萬美元。第一季非公認會計準則毛利率為 49.9%，而 2024 年第四季為 54.8%，2024 年第一季為 50.7%。第一季毛利率較上季下降主要是由於家庭和企業以及行動業務之間的產品結構轉變以及管理費用吸收減少所致。第一季非公認會計準則營運費用為 1,040 萬美元，與上一季持平，但比 2024 年第一季的 1,260 萬美元減少了約 220 萬美元。第一季營運費用的年減反映了我們先前實施的到 2024 年底的成本削減措施。

We've also taken additional cost reduction measures since the beginning of 2025, which we expect to result in further reductions in operating expenses beginning in the second quarter. Collectively, the cost reductions we have implemented over the past 12 months are expected to contribute to a total year-over-year decrease in operating expenses of approximately $10 million for the full year of 2025. On a non-GAAP basis, first quarter 2025 net loss was $6.5 million or a loss of $0.11 per share compared to a net loss of $4.3 million or a loss of $0.07 per share in the prior quarter and a net loss of $4 million or a loss of $0.07 per share in the first quarter of 2024. Adjusted EBITDA for the first quarter of 2025 was a negative $5.8 million compared to a negative $3.6 million in the prior quarter and a negative $3.2 million in the first quarter of 2024. Turning to the balance sheet.

自 2025 年初以來，我們還採取了額外的成本削減措施，預計這將導致從第二季開始進一步降低營運費用。總的來說，我們在過去 12 個月內實施的成本削減預計將導致 2025 年全年營運費用年減約 1,000 萬美元。以非公認會計準則計算，2025 年第一季淨虧損為 650 萬美元，即每股虧損 0.11 美元，而上一季淨虧損為 430 萬美元，即每股虧損 0.07 美元，2024 年第一季淨虧損為 400 萬美元，即每股虧損 0.07 美元。2025 年第一季的調整後 EBITDA 為負 580 萬美元，而上一季為負 360 萬美元，2024 年第一季為負 320 萬美元。轉向資產負債表。

We ended the first quarter with cash and cash equivalents of $18.5 million compared to $23.6 million at the end of the fourth quarter. As previously discussed, we have and continue to take actions to reduce overall costs and preserve our existing cash balance. Shifting to our current expectations and guidance for the second quarter of 2025. Based on our existing backlog, we currently expect total revenue for the second quarter to be in a range of between $8 million and $9 million. For the second quarter, we expect non-GAAP gross profit margin to be between 41% and 43%.

第一季末，我們的現金和現金等價物為 1,850 萬美元，而第四季末為 2,360 萬美元。如前所述，我們已經並將繼續採取行動來降低總體成本並保持現有的現金餘額。轉向我們對 2025 年第二季的當前預期和指導。根據我們現有的積壓訂單，我們目前預計第二季的總收入將在 800 萬美元至 900 萬美元之間。對於第二季度，我們預計非公認會計準則毛利率將在 41% 至 43% 之間。

This range primarily reflects a unique product mix that includes a newly ramping product with lower initial yields and margins that will meaningfully improve in the third and fourth quarters. With respect to our operating expenses, we expect second quarter operating expenses to be in a range of between $9 million and $10 million on a non-GAAP basis. Note that this range reflects the initial expected benefits associated with our cost reduction actions in March and anticipates only partial realized benefits from our most recent cost actions taken in early May. Lastly, we expect second quarter non-GAAP EPS to range between a loss of $0.11 per share and a loss of $0.08 per share. That completes our prepared remarks, and we look forward to taking your questions.

該範圍主要反映了獨特的產品組合，其中包括新推出的產品，其初始收益率和利潤率較低，但將在第三季和第四季得到顯著改善。關於我們的營運費用，我們預計第二季的營運費用將在非 GAAP 基礎上將在 900 萬美元至 1000 萬美元之間。請注意，該範圍反映了我們 3 月採取的成本削減行動所預期的初步收益，並且預計我們在 5 月初採取的最新成本行動僅能實現部分收益。最後，我們預計第二季非公認會計準則每股收益將在每股虧損 0.11 美元至每股虧損 0.08 美元之間。我們的準備演講到此結束，我們期待回答您的問題。

Operator, please proceed with the Q&A session. Thank you.

接線生，請繼續問答環節。謝謝。

(Operator Instructions) Suji Desilva, ROTH Capital.

（操作員指示） Suji Desilva，ROTH Capital。

Todd, you talked about Pixelworks Shanghai reaching profitability. Can you give us some help with what the revenue levels that might be achieved at? And maybe what portion of the OpEx is attributable to Shanghai so we can understand that operating model?

托德，您談到了 Pixelworks 上海公司獲利。您能否幫助我們了解可能實現的收入水平？也許有多少部分的營運支出歸因於上海，以便我們能夠了解這種營運模式？

So OpEx is approximately, I think, going into the back half of the year, we'll be down at $7 million a quarter, something like this, $7 million to $7.5 million, right, for Pixelworks Shanghai. As far as revenue, it's a mix of home and entertainment [coming back] projector, mobile, IP licensing and design services.

因此，我認為，到今年下半年，我們的營運支出大約會下降到每季 700 萬美元，對於 Pixelworks 上海來說，大概是 700 萬到 750 萬美元。就收入而言，它包括家庭和娛樂（回歸）投影機、行動、IP 授權和設計服務。

And to reach profitability, you don't need all of it to happen. You need a chunk of it to happen. And so the mix depends on how it falls in. If all of it happens the way we anticipate, then you'll be -- the unit will be profitable for both Q3 and Q4. But it's still early to say.

而為了實現獲利，你並不需要實現這一切。你需要一大塊才能實現。因此，混合取決於其如何融入。如果一切都按照我們預期的方式發生，那麼該部門將在第三季和第四季實現盈利。但現在說還太早。

Right. Okay. So OpEx for Shanghai, $7 million a quarter. Got it. And then switching over to TrueCut.

正確的。好的。因此上海的營運成本為每季 700 萬美元。知道了。然後切換到 TrueCut。

I'm just curious, your device discussions, are those Chinese brands given TrueCut's early kind of traction there? Are those global non-Chinese smartphone OEMs?

我只是好奇，在您的設備討論中，那些中國品牌是否給予了 TrueCut 早期的吸引力？這些是全球非中國的智慧型手機 OEM 嗎？

So you asked me about TrueCut and you're asking me about mobile OEMs.

所以你問我關於 TrueCut 的問題，你問我關於移動 OEM 的問題。

No, no, device discussions for TrueCut.

不，不，關於 TrueCut 的設備討論。

Okay. Okay. Yes. But you mentioned mobile OEMs. I wouldn't -- they're mobile OEMs, first of all, okay?

好的。好的。是的。但您提到了移動 OEM。我不會——首先，他們是行動原始設備製造商，好嗎？

And they could be, but I wouldn't conclude that. And they are -- the one that I talked about certification testing is not a Chinese OEM. And to be clear, just to give a little bit further clarity there. Our focus with TrueCut has about -- we do want to bring it on a global basis to premium home entertainment devices. But I would say that we've been focused on content generation here in Hollywood for the most part.

有可能，但我不會得出這樣的結論。而且──我談到的認證測驗不是中國 OEM。為了清楚起見，我們在此進一步澄清。我們對 TrueCut 的關注重點是——我們確實希望將其推廣到全球高端家庭娛樂設備。但我想說的是，我們大部分時間都專注於好萊塢的內容創作。

And we've been focused on home entertainment devices that would be marketed to North America and Europe, eventually globally, but we're very focused in North America and Europe for the home entertainment ecosystem for TrueCut.

我們一直專注於在北美和歐洲銷售並最終在全球銷售的家庭娛樂設備，但我們非常關注北美和歐洲的 TrueCut 家庭娛樂生態系統。

That's helpful, Todd. And then my last question is on the ASIC design services engagements, which are relatively new here. What's the -- how would you give a framework for sizing those opportunities and the revenue models associated?

這很有幫助，托德。我的最後一個問題是關於 ASIC 設計服務業務，這裡相對較新。您如何給出一個框架來衡量這些機會以及相關的收入模式？

Well, so you're talking about design services?

嗯，您說的是設計服務嗎？

Yes. And I guess there's IP layered in there, so I'm not sure how to --

是的。我猜這裡面有 IP 層，所以我不確定如何--

So you offer design services. Other companies offer design services. We're not the first company to do this, right? There are large system OEMs that want custom semiconductor content, but don't have an SoC design team that is proficient to start to finish tape out of a 12-nanometer SoC. So they can hire and outsource to other firms.

所以你提供設計服務。其他公司提供設計服務。我們不是第一家這樣做的公司，對吧？一些大型系統 OEM 需要客製化半導體內容，但卻沒有能夠熟練完成 12 奈米 SoC 設計的 SoC 設計團隊。因此他們可以僱用其他公司並將其外包給其他公司。

We have done this as co-development in the past or taken NRE for an ASIC. The difference between design services are you can open yourself up to an intermix of model where you can just do a portion of the design as a design service. You can do all of the turnkey for the design service. You may buy the [mask set] yourself, the customer may buy the mask set. The customer may do assembly and test.

我們過去曾以共同開發的方式進行過此工作，或將 NRE 用於 ASIC。設計服務之間的差異在於，你可以開放自己對混合模型的理解，其中你可以將部分設計作為設計服務來完成。您可以完成所有設計服務的交鑰匙工作。您可以自行購買【面膜套裝】，也可以顧客購買面膜套裝。客戶可以進行組裝和測試。

So what you've done is you've opened yourself up to anywhere in the process of design on how you can help this large system OEM get the custom silicon that they're looking for. So to get to your question, revenue size really would depend on how much you do for the customer.

所以，您所做的就是在設計過程中向任何方面​​敞開心扉，幫助這個大型系統 OEM 獲得他們想要的客製化矽片。所以回到你的問題，收入大小實際上取決於你為客戶做了多少。

To give you -- if you did a full turnkey and didn't do production, the customer went and did the production themselves. depending on what intellectual property is involved in large SoCs in 12-nanometer, I mean, they can range anywhere from probably a low of $10 million in cost to a high of $20 million in cost. Now that doesn't mean you'll do all of it on a turnkey basis, you may do part of it.

如果您完成了全部交鑰匙工程但沒有進行生產，那麼客戶就會自己去進行生產。根據 12 奈米大型 SoC 所涉及的智慧財產權，它們的成本可能從最低 1,000 萬美元到最高 2,000 萬美元不等。這並不意味著您將以交鑰匙的方式完成所有工作，您可以只完成其中的一部分。

So I'm not giving you clarity on the design project we're doing on because we haven't closed it yet, but I'm trying to give you a range on what design services at 12-nanometer would look like.

因此，我無法向您清楚地介紹我們正在進行的設計項目，因為我們還沒有結束它，但我試圖向您介紹 12 奈米設計服務的範圍。

(Operator Instructions) Richard Shannon, Craig-Hallum.

（操作員指示）理查德·香農，克雷格·哈勒姆。

I guess the first one I'll ask here is on mobile. Todd, I think in the last call, you talked about kind of a range of outcomes here, one of which would be, maybe on the lower side, be kind of flat or slightly up this year and then maybe on the high side being more like 2023. Maybe you could just help us understand how the engagements are lining up to anywhere in that range.

我想我要問的第一個問題是關於手機的。托德，我想在上次通話中，你談到了一系列結果，其中一種可能是，今年的低點可能比較平穩或略有上升，而高的可能更像 2023 年。也許您可以幫助我們了解該範圍內的參與情況。

Well, I would say, given the guidance we just gave for Q2, it would probably be hard to replicate 2023 revenue in mobile, which for everybody on the call was approximately $30 million, right? So we definitely expect an uptick in the second half of the year. But I would say we're probably closer to looking at a 2024 year-over-year or slightly above.

嗯，我想說，鑑於我們剛剛給出的第二季度指引，2023 年行動業務的收入可能很難複製，對於電話會議中的每個人來說，這個數字大約是 3000 萬美元，對嗎？因此我們肯定預計下半年會上漲。但我想說，我們可能更接近看到 2024 年同比增長或略高於去年同期的水平。

Okay. And then how do we think about the profile of this because you talked about some lower and mid-range kind of ASPs here. How do we think about this profile over this year?

好的。那麼我們如何看待這個問題，因為您在這裡談到了一些低端和中端的 ASP。我們如何看待今年的這項概況？

It will be predominantly on the low end at those revenue levels. And ASPs are sub $2.

在這些收入水平中，其收入將主要處於低端。平均售價低於 2 美元。

Okay. Let's jump over to TrueCut. You talked about a collaboration with a post-production house here. I guess, this collaboration mean it's a done deal? Or is there still something to be worked out here?

好的。讓我們跳到 TrueCut。您在這裡談到了與後製公司的合作。我猜，這次合作意味著一切都已成定局？或者這裡還有一些事情需要解決？

And then how do we think about the -- this partner here, this collaborator in terms of how they -- how informed they are about how the ecosystem is building? Is this more of a build it and they will come thing? Or is this highly informed and they know something is about to happen soon?

那我們該如何看待這個合作夥伴、這個合作者，他們對於生態系統的建構方式了解多少？這是否更像是一種建好之後就會來的事情？或者這是高度知情的並且他們知道某事即將發生？

So let's be clear, this is -- we haven't announced the name because we would prefer to announce the name with projects that the two of us have engaged in with a film. And so until that's done, we probably won't announce who it is, but it is a signed agreement. And the nature of the company is that the company is a mature, large post-production house that does color grading and other forms of post-production processing for theatrical titles. They get to see a lot of -- we're targeted. If you go look at what we're targeting, we did 5 films last year.

所以讓我們明確一點，我們還沒有宣布名字，因為我們更願意透過我們兩人參與的電影項目來宣布名字。因此，在完成之前，我們可能不會宣布具體是誰，但這是一個簽署的協議。該公司的性質是，該公司是一家成熟的大型後製公司，為影院片頭進行調色和其他形式的後製處理。他們看到了很多——我們成為了目標。如果你看看我們的目標，你會發現去年我們拍了 5 部電影。

We're trying to double it this year. But these are all meant to be top 50 type budgeted films for the year, right? This post-production house deals with many of these films already, right? They get access -- I mean, we have access to some of these filmmakers through the studios that we have relationships with. They have access to the filmmakers through other means.

我們力爭今年將其翻一番。但這些都是今年預算最高的 50 部電影，對嗎？這家後製公司已經處理了很多這樣的電影，對嗎？他們獲得了訪問權限——我的意思是，我們可以透過與我們有關係的製片廠接觸到一些電影製片人。他們可以透過其他方式接觸電影製作人。

So we believe that -- and what they see is a benefit for it, I think, which is the most important thing. I mean, clearly, we're small, any way for us to expand our reach is good for us. But why would they do it? If they're a large mature post-production company, why would they want to do it? And the reason is, is they clearly see the benefits of what motion grading does to the content and what it brings to premium large format experience. That's one. But two, they want to expand their stickiness, their capabilities to their filmmaker customers.

所以我們相信——而且我認為他們看到的是它的好處，這是最重要的。我的意思是，顯然我們的規模很小，任何擴大影響力的方式對我們都有好處。但他們為什麼要這麼做呢？如果他們是一家大型成熟的後製公司，他們為什麼要這樣做？原因是，他們清楚地看到了運動分級對內容的好處以及它為優質大格式體驗帶來的好處。那是一個。其次，他們希望增強對電影製作人的黏性和能力。

(Operator Instructions) Nick Doyle, Needham & Company.

（操作員指示） Nick Doyle，Needham & Company。

Could you just expand on the two comments you made on mobile? You talked about multiple programs with your lead customer and then additional engagements. I guess the question is, do you mean you're in multiple phones now with that lead customer and those unit shipments are getting us to the revenue levels you just talked about? And then would any additional engagements that you're working on now, would they come in 2025? would we see revenue in 2025?

您能否詳細說明一下您對行動裝置發表的兩則評論？您與您的主要客戶討論了多個計劃，然後討論了其他合作。我想問題是，你的意思是現在你們已經為該主要客戶提供了多款手機，而這些手機的出貨量使我們達到了你剛才談到的收入水平嗎？那麼，您現在正在進行的任何其他活動會在 2025 年舉行嗎？我們會在 2025 年看到收入嗎？

So the additional engagements are booked design wins with actually the X7P, right? The co-development or collaboration with this lead customer, this is for a new solution that we haven't offered to the market yet, right? And it's a complete rework of the software for our visual processor. And it is focused not just on enhancing the gaming experience but enhancing all graphical experience. So what's happening here is high frame rate displays are moving down because the cost of the display itself, the panel, there's no adder anymore to 120 frame per second LCD display.

那麼額外的約定實際上是 X7P 的預定設計勝利，對嗎？與該主要客戶共同開發或協作，是為了提供我們尚未向市場提供的新解決方案，對嗎？這是對我們的視覺處理器軟體的徹底重新設計。它不僅注重增強遊戲體驗，還注重增強所有圖形體驗。所以現在發生的情況是高幀率顯示器的成本正在下降，因為顯示器本身的成本，面板，不再有每秒 120 幀的 LCD 顯示器的成本增加。

Video mode display. It is almost met parity, if not met parity with 60 and 90 frame per second displays. So what you're seeing is it moved down to -- and I talk in RMB because we're talking to Chinese OEMs that target certain market segments. So this is RMB1,000 or RMB1,500 type market segment. And they're sold globally, but they're low cost.

視訊模式顯示。它幾乎達到了奇偶校驗，如果沒有達到每秒 60 和 90 幀的奇偶校驗。所以你看到的是它下降到了——我用人民幣來談，因為我們正在與針對特定細分市場的中國原始設備製造商進行談判。所以這是人民幣 1,000 元或人民幣 1,500 元類型的細分市場。它們在全球銷售，但價格低廉。

And as you put high frame rate displays in these lower-end phones, the APs were not designed to take advantage of a high frame rate display. So if you add our graphics accelerator, it can look like a flagship experience. And this is not just from a gaming experience standpoint. This is from like anybody that has a phone in front of them right now listening to this call, if you have a promotion display from Apple, this thing is a variable display up to 120 frames per second. If you scroll up and down on it, the faster you scroll up and down on it, it will adjust to what you're doing.

當您在這些低階手機中安裝高幀率顯示器時，AP 的設計並不能利用高幀率顯示器的優勢。因此，如果添加我們的圖形加速器，它看起來就像是旗艦體驗。這不僅僅是從遊戲體驗的角度來看的。就像任何現在拿著手機收聽這個電話的人一樣，如果你有蘋果的促銷顯示器，這個東西就是每秒高達 120 幀的可變顯示器。如果您在其上上下滾動，則您上下滾動的速度越快，它就會根據您正在做的事情進行調整。

It will do high speed, or it will do low speed. If you try to do this on these low-end phones, you'll see lots of visual artifacts. It doesn't -- the GPU doesn't keep up with the pixel rendering or the frame generation. And so what we're doing is bringing an accelerator to this low-end market. What we've done with this co-development customer has worked with their engineering team, their system engineering team and software team to vet out all the little issues.

它會以高速運行，或以低速運行。如果您嘗試在這些低階手機上執行此操作，您會看到很多視覺偽影。但事實並非如此——GPU 無法跟上像素渲染或幀生成的速度。因此，我們正在做的是為這個低端市場帶來加速器。我們與這位共同開發客戶所做的就是與他們的工程團隊、系統工程團隊和軟體團隊合作，審查所有小問題。

There's lots of little issues between us and the AP that's involved and Android. We've reached a point where system engineering has approved the solution to be marketed internally to all the program managers and product planners that we're targeting. We're at that stage in the process. We anticipate it will generate multiple design wins, not only with that customer, but eventually with multiple customers. There are no designs in the bag as of yet. There are designs that are available to us this year.

我們與所涉及的 AP 和 Android 之間存在著許多小問題。我們已經達到了這樣的程度：系統工程已批准將該解決方案內部推銷給我們所針對的所有專案經理和產品規劃人員。我們正處於這個進程的這個階段。我們預計它將贏得多個設計勝利，不僅針對該客戶，而且最終將贏得多個客戶的勝利。目前包包裡還沒有任何設計。今年我們有一些可用的設計。

Got it. And second, could you help pull out the gross margin impact regarding the yield issues? Where are the meaningful yield improvements coming from? And can that get you back to mobile gross margin levels in the mid-30s?

知道了。其次，您能否幫忙解釋一下收益問題對毛利率的影響？顯著的產量提升從何而來？這能讓您的行動毛利率回到 30% 左右的水平嗎？

So the product issues are not with mobile. The product issues are with a new projector chip we have that it's not a big thing. When you ramp a chip, sometimes you need to get your yield up. And until you run volume, it's hard to do that. And so the first quarter or so of high volume, you can experience lower-than-expected yields.

因此產品問題不在於行動裝置。產品問題出在我們擁有的新投影機晶片上，這不是什麼大問題。當你提高晶片產量時，有時你需要提高產量。除非你運行音量，否則很難做到這一點。因此，在交易量較高的第一季左右，您可能會遇到低於預期的收益率。

And sometimes you recapture these devices, you don't always throw them away. Sometimes it's just enhancing your test program. But if it's within a quarter, then it will look like lower-margin product. So I think what we're trying to articulate to you, this is not a pricing low margin mix issue. This is us ramping a product that we expect -- we're already making yield advancements.

有時你會重新獲得這些設備，但並不總是將它們扔掉。有時它只是增強你的測試程序。但如果在一個季度內，那麼它看起來就像是利潤較低的產品。所以我認為我們試圖向您闡明的是，這不是定價低利潤組合的問題。這是我們預期的一款產品的提升——我們已經在提高產量。

So I expect it to be back -- on that side back to where our target yields were. But with that said, as we ramp mobile, mobile margins will be lower than projector. So the mix will become more important as we re-ramp mobile again.

因此我預期收益率會回到我們的目標水準。但話雖如此，隨著我們擴大行動業務，行動利潤率將低於投影機。因此，當我們再次重啟行動業務時，組合將變得更加重要。

And I'm not showing any further questions at this time. And as such, this does conclude today's presentation. You may now disconnect and have a wonderful day.

我現在不想再問任何問題。今天的演講就到此結束了。現在您可以斷開連接並享受美好的一天。