Silicom Ltd (SILC) 2024 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the Silicom fourth-quarter 2024 results conference call. (Operator Instructions) As a reminder, this conference is being recorded.

女士們、先生們，感謝你們的支持。歡迎參加 Silicom 2024 年第四季業績電話會議。（操作員指示）提醒一下，本次會議正在錄音。

You should have all received by now the company's press release. If you have not received it, please contact Silicom's Investor Relations team at EK Global Investor Relations at 1 (212) 378-8040 or view it in the News section of the company's website, www.silicom-usa.com.

大家現在應該已經收到該公司的新聞稿了。如果您尚未收到，請聯絡 EK Global Investor Relations 的 Silicom 投資者關係團隊，電話 1（212）378-8040，或在公司網站 www.silicom-usa.com 的新聞部分查看。

I would now like to hand over the call to Mr. Kenny Green of EK Global Investor Relations. Mr. Green, would you like to begin, please?

現在，我想將電話轉給 EK 全球投資者關係部門的肯尼·格林先生。格林先生，請您開始吧？

Thank you, operator. I would like to welcome all of you to Silicom's quarterly results conference call.

謝謝您，接線生。歡迎大家參加 Silicom 的季度業績電話會議。

Before we start, I would like to draw your attention to the following safe harbor statement. This conference call contains forward-looking statements. Such statements may include, but are not limited to, anticipated future financial and operating results and Silicom's outlook and prospects. Those statements are based on management's current beliefs, expectations, and assumptions, which may be affected by subsequent business, political, environmental, regulatory, economic, and other conditions and are subject to known and unknown risks and uncertainties and other factors, many of which are outside of Silicom's control, which might cause actual results to differ materially from expectations expressed or implied in the forward-looking statements.

在我們開始之前，我想提請您注意以下安全港聲明。本次電話會議包含前瞻性陳述。這些聲明可能包括但不限於預期的未來財務和經營業績以及 Silicom 的前景和展望。這些聲明是基於管理層當前的信念、期望和假設，可能會受到後續業務、政治、環境、監管、經濟和其他條件的影響，並受到已知和未知的風險、不確定性和其他因素的影響，其中許多不在 Silicom 的控制範圍內，可能導致實際結果與前瞻性聲明中表達或暗示的預期存在重大差異。

These include, but are not limited to, Silicom's increasing dependence for substantial revenue growth on a limited number of customers, the speed and extent to which Silicom solutions are adopted by the relevant markets, difficulties in the commercialization and marketing of Silicom's products and services, maintaining and protecting brand recognition, protection of intellectual property, competition, disruptions to manufacturing and sales and marketing; development and customer support activities; the impact of war in Israel and in the Ukraine, rising inflation, changing interest rates, volatile exchange rates as well as any and continuing or new effects resulting from the COVID-19 pandemic and global economic uncertainty, which may impact customer demand through customers exercising greater caution and selectivity with their short-term IT investment plan.

這些包括但不限於 Silicom 對有限數量客戶的大幅收入增長的依賴日益增加、Silicom 解決方案被相關市場採用的速度和程度、Silicom 產品和服務商業化和營銷的困難、維護和保護品牌知名度、保護知識產權、競爭、製造和銷售及營銷的中斷；開發和客戶支援活動；以色列和烏克蘭戰爭的影響、通貨膨脹上升、利率變化、匯率波動以及 COVID-19 疫情和全球經濟不確定性造成的任何持續或新的影響，這些都可能透過客戶在短期 IT 投資計劃中採取更加謹慎和選擇性的方式影響客戶需求。

The factors noted are not exhausted. Further information about the company's businesses, including information about factors that could materially affect Silicom's results of operations and financial condition are discussed in Silicom's annual report on Form 20-F and other documents filed by the company and that may be subsequently filed by the company from time to time with the Securities and Exchange Commission. Therefore, there can be no assurance that actual future results will not differ materially from anticipated results.

所提到的因素並未窮盡。有關公司業務的更多信息，包括可能對 Silicom 的經營業績和財務狀況產生重大影響的因素的信息，在 Silicom 的 20-F 表年度報告和公司提交的其他文件中進行了討論，並且公司可能會隨後不時向美國證券交易委員會提交這些文件。因此，無法保證未來的實際結果不會與預期結果有重大差異。

Consequently, investors are reminded not to rely on these forward-looking statements. Silicom does not undertake to update any forward-looking statement as a result of new information or future events or developments, except as may be required by law. In addition, following the company's disclosure of certain non-GAAP financial measures in today's earnings release, such non-GAAP financial measures will be discussed during this call. Such non-GAAP measures are used by management to make strategic decisions, forecast future results and evaluate the company's current performance. Management believes that the presentation of these non-GAAP financial measures are useful to investors' understanding and assessment of the company's ongoing core operations and prospects for the future.

因此，提醒投資者不要依賴這些前瞻性陳述。Silicom 不承諾根據新資訊或未來事件或發展更新任何前瞻性聲明，除非法律另有要求。此外，繼公司在今天的收益報告中揭露某些非公認會計準則財務指標後，此類非公認會計準則財務指標將在本次電話會議中討論。管理階層使用此類非公認會計準則指標來制定策略決策、預測未來績效並評估公司當前績效。管理階層認為，這些非公認會計準則財務指標的呈現有助於投資者了解和評估公司持續的核心業務和未來前景。

Unless otherwise stated, it should be assumed that financials discussed in this conference call will be on a non-GAAP basis. Non-GAAP financial measures disclosed by management are provided as additional information to investors in order to provide them with an alternative method for assessing the company's financial condition and operating results. These measures are not in accordance with or a substitute for GAAP. A full reconciliation of non-GAAP to GAAP financial measures are included in today's earnings release, which you can find on Silicom's website.

除非另有說明，否則應假定本次電話會議中討論的財務數據均採用非 GAAP 基礎。管理階層揭露的非公認會計準則財務指標作為補充資訊提供給投資者，以便為他們提供評估公司財務狀況和經營績效的替代方法。這些措施並不符合 GAAP，也不能取代 GAAP。今天的收益報告包含了非 GAAP 與 GAAP 財務指標的完整對賬，您可以在 Silicom 的網站上找到。

With us on the line today are Mr. Liron Eizenman, President and CEO; and Mr. Eran Gilad, CFO. Liron will begin with an overview of the results, followed by Eran, who will provide the analysis of the financials. We will then turn the call over to the question-and-answer session.

今天與我們通話的是總裁兼執行長 Liron Eizenman 先生；以及財務長 Eran Gilad 先生。Liron 將首先概述結果，然後由 Eran 提供財務分析。然後我們將把電話轉入問答環節。

And with that, I would now like to turn the call over to Liron. Liron, please go ahead.

說完這些，我現在想把電話轉給 Liron。Liron，請繼續。

Thank you, Kenny. Welcome, everyone, to our conference call to discuss the results of the fourth quarter and full year 2024. We are pleased with our achievement this quarter, delivering financial results in line with the expectations. And even more importantly, we made continuous progress in line with our strategic plan aimed at bringing renewed revenue growth, profitability and ultimately, increased shareholder value. Strategically, I'm happy to say that we are on track. And during the past quarter, we saw strong design win momentum, increasing the visibility of our potential mid- to long-term revenue growth.

謝謝你，肯尼。歡迎大家參加我們的電話會議，討論 2024 年第四季和全年業績。我們對本季所取得的成績感到滿意，財務表現符合預期。更重要的是，我們依照策略計畫不斷取得進展，旨在實現收入再增長、獲利能力再提高，並最終提高股東價值。從戰略上來說，我很高興地說我們已經走在正確的軌道上。在過去的一個季度中，我們看到了強勁的設計勝利勢頭，提高了我們潛在的中長期收入成長的可見性。

Those achievements highlight the effectiveness of our strategy and position us well with the potential revenues from recent wins expected to ramp up from 2026. Our renewed focus on our core product lines, coupled with our strong relationship with our customers and potential new customers, created a significant pipeline, which we hope to convert to even more design wins in 2025. While we continue to overcome short-term challenges, during the quarter, we achieved milestone after milestone with a variety of customers and projects, and we advanced exciting opportunities through our broad pipeline towards future design wins. All this is a clear indication that we are on track for a return to strong double-digit growth in 2026 and beyond.

這些成就凸顯了我們策略的有效性，並使我們有望從最近的勝利中獲得從 2026 年開始增加的潛在收入。我們重新專注於核心產品線，加上與客戶和潛在新客戶的牢固關係，創建了重要的產品線，我們希望在 2025 年將其轉化為更多的設計勝利。在我們繼續克服短期挑戰的同時，在本季度，我們與各種客戶和專案一起實現了一個又一個的里程碑，並且我們透過廣泛的管道向未來的設計勝利推進了令人興奮的機會。所有這些都清楚地表明，我們預計在 2026 年及以後恢復強勁的兩位數成長。

In terms of our financial performance for the fourth quarter, our revenue came in at the center of our expected range at $14.5 million. During 2024, we generated $17.3 million in cash with $10 million, well over half of our cash generation used to repurchase our own shares as part of our ongoing buyback plan. This is aligned with our long-term strategy of shareholder value creation. Our ability to pursue this strategy is due to our strong balance sheet built up over our many years of success and cash generation. This ensures we can maintain adequate investment in our business and its growth engines without compromise and at the same time, take advantage of opportunities to increase shareholder value.

就我們第四季的財務業績而言，我們的收入達到預期範圍的中間，為 1,450 萬美元。2024 年，我們產生了 1,730 萬美元的現金，其中 1,000 萬美元，超過一半的現金用於回購我們自己的股票，這是我們正在進行的回購計劃的一部分。這與我們創造股東價值的長期策略一致。我們之所以能夠實施這項策略，得益於我們多年來的成功和現金創造所建立的強勁資產負債表。這確保了我們能夠對我們的業務及其成長引擎保持充足的投資，同時不妥協，並利用機會增加股東價值。

Just to highlight the balance sheet strength, at the end of the fourth quarter, our working capital and marketable securities amounted to $121 million, including $79 million in cash, deposits and highly rated bonds with no debt. All this amounts to $21 per share. We remain on track with our long-term strategic plan, which is targeting an EPS above $3 at a revenue level of between $150 million and $160 I want to highlight two recent design wins and highlight the progress that we have made in recent months. We recently announced a new design win with a major US-based cybersecurity company, an existing customer of ours. We received initial orders and expect first revenues in the second half of 2025 with revenue starting to ramp up in 2026 to achieve a full annual run rate of around $2 million.

為了突顯資產負債表的實力，截至第四季末，我們的營運資本和有價證券總額為 1.21 億美元，其中包括 7,900 萬美元的現金、存款和無債務的高評級債券。所有這些加起來就是每股21美元。我們仍在按計劃執行我們的長期戰略計劃，該計劃的目標是每股收益超過 3 美元，營收水準在 1.5 億美元至 1.6 億美元之間。我們最近宣布與一家美國大型網路安全公司（我們現有客戶）成功簽訂了新的設計協議。我們收到了初始訂單，預計在 2025 年下半年實現首筆收入，並於 2026 年開始增加收入，實現約 200 萬美元的全年營運率。

This design win is for the next generation of this customer's leading product line. Our ability to efficiently customize this product for our customer, providing both an edge system and our network interface card were key factors in securing the win. Our capability to deliver both products is highly synergistic from the customer's point of view and provides us with a significant competitive advantage. We believe this trend will gain traction with additional customers, and we have several other accounts in the pipeline looking at a similar approach. This win expands the relationship that we have been building with this customer for several years. Furthermore, we continue to discuss the potential for including additional product for the customer's other product lines.

此次設計勝利是為了該客戶下一代的主導產品線。我們能夠有效率地為客戶客製化該產品，提供邊緣系統和網路介面卡，這是獲得勝利的關鍵因素。從客戶的角度來看，我們提供這兩種產品的能力具有高度的協同作用，並為我們提供了顯著的競爭優勢。我們相信這種趨勢將會吸引更多的客戶，而且我們還有其他幾個客戶正在考慮類似的方法。這次勝利擴大了我們與該客戶多年來建立的合作關係。此外，我們將繼續討論為客戶的其他產品線添加附加產品的可能性。

We also announced a design win with a global networking and security as a service leader, a new customer standardizing on silicon for all its edge deployment scenarios. This makes us their sole edge networking hardware provider, paving the way for additional multimillion dollar design wins. This first design win with this customer encompasses several products, including several of our newest edge networking solutions pre-integrated with Silicom's network interface cards. Initial deliveries should begin in the second half of 2025 with revenues from this design win starting to ramp up to over $3 million annually from 2026. This was the result of a process which began a year ago when we initiated a discussion covering a specific product.

我們也宣布與一家全球網路和安全服務領導者達成設計合作，這家新客戶正在針對其所有邊緣部署場景採用矽片標準化。這使我們成為他們唯一的邊緣網路硬體供應商，為贏得數百萬美元的額外設計勝利鋪平了道路。此次與該客戶合作的首次設計涵蓋多種產品，其中包括我們預先整合了 Silicom 網路介面卡的幾款最新邊緣網路解決方案。初始交付應於 2025 年下半年開始，設計勝利帶來的收入將從 2026 年開始增加到每年 300 萬美元以上。這是我們一年前發起有關特定產品的討論的結果。

Over time, the discussion expanded to more products and additional use cases, leading to this design win as well as the potential for others. The fact that we can address all the edge networking needs of this customer confirms the value of our broad product portfolio and the strength of our offering. Those wins underscore the traction of our renewed sales growth strategy, building a robust pipeline and strong base of recurring revenues for long-term growth. The relationships are based on deep trust built over a long period of time and show slow but solid growth, supporting the success of our strategic plans. I want to provide some more color on our pipeline.

隨著時間的推移，討論擴展到更多產品和更多用例，最終贏得了該設計，並具有其他設計的潛力。我們能夠滿足該客戶的所有邊緣網絡需求，這證實了我們廣泛的產品組合的價值和我們提供的服務的實力。這些勝利凸顯了我們新的銷售成長策略的吸引力，為長期成長建立了強勁的管道和強大的經常性收入基礎。這種關係建立在長期建立的深厚信任的基礎上，並呈現緩慢但穩健的成長，支持了我們策略計畫的成功。我想提供更多有關我們管道的資訊。

Today, the pipeline of opportunities and the input of our design win funnel is broader than it has been for a very long time, encompassing edge systems, SmartNICs and FPGAs. Our target is to achieve between seven and nine additional new design wins in 2025. I want to note that the sales cycle for our product is inherently long. In our experience, it takes between 9 and 12 months to achieve a design win from initial contact and then further three to nine months working closely with the customer to initial revenues with up to 12 months for a meaningful ramp-up. It therefore takes significant time from the first achieving a design win to when Silicom experienced significant recurring revenues.

今天，我們設計成功通路的機會和投入比很長一段時間以來都要廣泛，涵蓋了邊緣系統、SmartNIC 和 FPGA。我們的目標是到 2025 年再獲得 7 到 9 項新設計獎。我想指出的是，我們產品的銷售週期本來就很長。根據我們的經驗，從初次接觸到獲得設計勝利需要 9 到 12 個月的時間，之後需要再花 3 到 9 個月的時間與客戶密切合作才能獲得初始收入，最長可能需要 12 個月的時間才能實現有意義的增長。因此，從首次獲得設計勝利到 Silicom 獲得可觀的經常性收入需要相當長的時間。

However, when we do reach a steady state of recurring revenues, those tend to provide a long tail over the lifetime of the customer's product, which can be many years. I want to highlight our new investor presentation, which you can find on the website, which includes examples of some of the many opportunities in our pipeline. It also shows examples of the opportunities which made it through the funnel and have become design wins and a source of revenue growth. We are seeing the positive impact of our focus on small to medium design wins, expanding the pool of future opportunities in addition to the deals with the potential for double-digit millions of dollars in annual revenue.

然而，當我們確實達到穩定的經常性收入狀態時，這些收入往往會在客戶產品的整個生命週期中提供長尾效應，而這個生命週期可能會持續很多年。我想重點介紹一下我們的新投資者介紹，您可以在網站上找到，其中包括我們正在籌備的眾多機會中的一部分的例子。它也展示了透過管道獲得成功並成為設計勝利和收入成長來源的機會的例子。我們看到了對中小型設計訂單的關注所產生的正面影響，除了可能帶來數百萬美元年收入的交易之外，還擴大了未來的機會範圍。

We believe that during the coming years, we will see a lot of additional new opportunities at the input of the funnel, and we expect that more and more of those opportunities will convert into design wins. Furthermore, the potential growth is supported by an increasingly diverse pipeline of design wins, including both new and existing customers. This pipeline includes leading names in the networking, service providers and cybersecurity industries. As we increase the number of those strategic engagements, we believe they will lead to more sustainable revenue growth by reducing our reliance on a few large strategic accounts.

我們相信，在未來幾年內，我們將在漏斗的輸入端看到許多額外的新機會，並且我們預計將越來越多的這些機會轉化為設計勝利。此外，日益多樣化的設計中標管道（包括新客戶和現有客戶）也為潛在成長提供了支援。該管道包括網路、服務供應商和網路安全產業的領先公司。我們相信，隨著這些策略合作數量的增加，它們將減少我們對少數大型策略帳戶的依賴，從而帶來更永續的收入成長。

While our recent design wins will have minor positive impact on our financial results in 2025, we believe those and others that we expect to sign in the coming months will serve as the foundation for much more meaningful growth in 2026. I note that if the opportunities in the pipeline ramp up faster than expected, we could achieve the goals of our strategic plan sooner than currently projected. In terms of our guidance for the first quarter of 2025, revenues are expected to remain stable at levels similar to those of the past few quarters, between $14 million and $15 million. Looking further out, growth in 2025 is expected to be in the low single digits with strong double-digit annual growth rate materializing gradually from 2026.

雖然我們最近贏得的設計合約對我們 2025 年的財務業績不會產生太大的積極影響，但我們相信，這些合約以及我們預計在未來幾個月內簽署的其他合約將為 2026 年更有意義的增長奠定基礎。我注意到，如果潛在機會的成長速度比預期的快，我們就能比目前預期的更快實現策略計畫的目標。就我們對 2025 年第一季的預期而言，預計收入將保持穩定，與過去幾季的水平相似，在 1400 萬美元至 1500 萬美元之間。放眼未來，預計 2025 年成長率將保持在低個位數，而從 2026 年開始將逐步實現強勁的兩位數年增長率。

In summary, we are pleased with our progress. We are very optimistic about our ability to continue and execute on our growth plan and fully focused on meeting our goal of creating value for our customers and for our shareholders. We are advancing towards our mid- and long-term goals with a robust pipeline that positions us well for double-digit growth from 2026 onwards. As I have mentioned, we aim to achieve seven to nine design wins in 2025, which will serve us as a key indicator of our progress. Looking further out, we continue to focus on creating strong long-term value for our shareholders, aiming at an EPS of above $3 when we reach annual revenues in the range of $150 million to $160 million.

總而言之，我們對我們的進展感到滿意。我們對繼續執行成長計畫的能力非常樂觀，並全心全意專注於為客戶和股東創造價值的目標。我們正憑藉強大的產品線向著中長期目標邁進，這將使我們從 2026 年開始實現兩位數的成長。正如我所提到的，我們的目標是在 2025 年獲得七到九項設計大獎，這將成為我們進步的關鍵指標。放眼長遠，我們將繼續致力於為股東創造強勁的長期價值，目標是在年收入達到 1.5 億至 1.6 億美元時，實現每股收益 3 美元以上。

A fast ramp-up of a few of the potential deals we have within the pipeline may help us achieve this goal faster. We have a strong design win roster, full of Tier 1 customers, coupled with superb products and a robust pipeline of opportunities. We have a strong financial foundation with a solid balance sheet. We continue to generate positive cash flow, and we have an active share repurchase program that underscores our commitment to enhancing shareholder value. The new opportunities and design wins momentum that has grown throughout 2024 has increased the already high motivation and dedication of our excellent team who entered 2025 with excitement regarding Silicom's prospects. We look forward to reporting on our progress as we continue executing on our growth strategy.

快速推進一些我們正在進行的潛在交易可能會幫助我們更快地實現這一目標。我們擁有強大的設計獲勝名單，其中不乏一級客戶，還有卓越的產品和豐富的商機。我們擁有強大的財務基礎和穩健的資產負債表。我們繼續產生正現金流，我們有一個積極的股票回購計劃，強調我們致力於提高股東價值。2024 年不斷增長的新機會和設計勝利勢頭進一步增強了我們優秀團隊原本就很高的積極性和奉獻精神，他們對 Silicom 的前景充滿期待，帶著這種興奮的心情進入了 2025 年。我們期待在繼續執行成長策略的過程中報告所取得的進展。

With that, I will now hand over the call to Eran for a detailed review of the quarter results. Eran, please go ahead.

說完這些，我現在將電話交給 Eran，讓他詳細審查本季的表現。Eran，請繼續。

Thank you, Liron, and good day to everyone. Revenues for the fourth quarter of 2024 were $14.5 million, a decline from revenues of $18.8 million as reported in the fourth quarter of last year. The geographical revenue breakdown over the last 12 months was as follows: North America, 76%; Europe and Israel, 16%; Far East and Rest of the World, 8%. During the last 12 months, our top -- our 2 10% plus customers together accounted for about 26% of our revenues. I will be presenting the rest of the financial results on a non-GAAP basis, which excludes the noncash compensation expenses in respect of options and RSUs granted to directors, officers and employees, impairment of goodwill, taxes on amortization and impairment of acquired intangible assets, impairment of intangible assets and related write-offs as well as lease liabilities, financial expenses.

謝謝你，Liron，祝大家有個愉快的一天。2024 年第四季的營收為 1,450 萬美元，較去年第四季報告的 1,880 萬美元有所下降。過去 12 個月的地理收入分佈如下：北美，76%；歐洲和以色列，16%；遠東和世界其他地區，8%。在過去的 12 個月中，我們最大的 2 個 10% 以上的客戶合計貢獻了我們約 26% 的收入。我將以非 GAAP 為基礎呈現其餘財務結果，其中不包括授予董事、高級職員和員工的選擇權和 RSU 的非現金薪酬費用、商譽減損、攤銷稅和收購無形資產減損、無形資產減損和相關注銷以及租賃負債、財務費用。

For the full reconciliation from GAAP to non-GAAP numbers, please refer to the press release we issued earlier today. Gross profit for the fourth quarter of 2024 was $4.2 million, representing a gross margin of 29.1% and compared to a gross profit of $5.3 million or gross margin of 28% in the fourth quarter of 2023. As discussed previously, in the near term, our gross margin is expected to be towards the lower end of our expected 27% to 32% range. And as our revenues grow from current levels over the longer term, it is expected to increase towards the upper end. Operating expenses in the fourth quarter of 2024 were $6.9 million compared with $6.8 million reported in the fourth quarter of 2023.

有關 GAAP 與非 GAAP 數據的完整對賬，請參閱我們今天早些時候發布的新聞稿。2024 年第四季的毛利為 420 萬美元，毛利率為 29.1%，而 2023 年第四季的毛利為 530 萬美元，毛利率為 28%。如前所述，短期內，我們的毛利率預計將處於預期 27% 至 32% 範圍的低端。而且隨著我們的收入在長期內從現有水平增長，預計收入將向高端增長。2024 年第四季的營運費用為 690 萬美元，而 2023 年第四季的營運費用為 680 萬美元。

Operating loss for the fourth quarter of 2024 was $2.7 million compared to operating loss of $1.5 million as reported in the fourth quarter of 2023. Net loss for the quarter was $3.4 million compared to a net loss of $0.5 million in the fourth quarter of 2023. Loss per share in the quarter was $0.58. This is compared with net loss per share of $0.07 as reported in the fourth quarter of last year.

2024 年第四季的營業虧損為 270 萬美元，而 2023 年第四季的營業虧損為 150 萬美元。本季淨虧損為 340 萬美元，而 2023 年第四季淨虧損為 50 萬美元。本季每股虧損 0.58 美元。相比之下，去年第四季每股淨虧損為 0.07 美元。

Now turning to the balance sheet. As of December 31, 2024, our working capital and marketable securities amounted to $121 million, including $41 million in high-quality inventory, accounts receivable net of accounts payable of $3 million and $79 million in cash, cash equivalents and highly rated marketable securities with no debt. During 2024, we used $10 million for the repurchase of about 650,000 shares.

現在轉向資產負債表。截至 2024 年 12 月 31 日，我們的營運資本和有價證券總額為 1.21 億美元，其中包括 4,100 萬美元的優質庫存、300 萬美元的應收帳款減去應付帳款的淨額以及 7,900 萬美元的現金、現金等價物和無債務的高評級證券。2024年，我們使用1000萬美元回購了約65萬股。

That ends my summary. I would like to hand back over to the operator for questions-and-answer session. Operator?

我的總結到此結束。我想將電話交還給接線員進行問答環節。操作員？

Ryan Koontz, Needham & Company.

瑞安·孔茨 (Ryan Koontz)，Needham & Company。

Hi. This is Jeff Hopson on for Ryan Koontz at thank you for the very comprehensive presentation today. It's very helpful to visualize all the opportunities and design wins at Silicom. Maybe if we could just go into some of those design wins. As you laid out the time line, it does take a long time from design to revenue. What is then the typical contract length or yearly engagements for each of these design wins on average?

你好。我是 Jeff Hopson，代表 Ryan Koontz 感謝您今天非常全面的演講。將 Silicom 的所有機會和設計成果形象化是非常有幫助的。也許我們可以深入討論其中一些設計勝利。正如您所列出的時間表，從設計到收益確實需要很長時間。那麼，這些設計得標的典型合約期限或年度合約期限平均是多少？

We estimate usually it spans around four to five years. So it's quite a lot of work to get started and win. But once we are there, usually, a customer would go for us for four or five years and then discussions would start on the next generation, but that's very typical for us.

我們估計通常需要四到五年左右的時間。因此，要開始並取得成功，需要做很多工作。但一旦我們到達那裡，通常情況下，客戶會與我們合作四到五年，然後再開始討論下一代產品，但這對我們來說很典型。

And then for these new products or new designs, are there any architectural design changes? Or what's kind of the underlying competitive advantage that Silicom has for these new opportunities?

那麼對於這些新產品或新設計，架構設計有什麼變化嗎？或者說 Silicom 在這些新機會中擁有什麼樣的潛在競爭優勢？

I mean, first of all, we are really at the -- I would say I would say, at the edge of the newest technology working with the best silicom vendors out there and working very, very closely with them to make sure we are usually the first to be out with a product as long as the silicom launches, we are also launching our product -- but I mean, that's not the only thing. We're also providing a full solution for our customers in the sense that we also understand software very well, and we can give them all the supply chain capabilities they need around the product to be successful. But always being first and we invest quite heavily in R&D that puts us in a very strong position to be a great, let's say, also consultant to our customers about what to do.

我的意思是，首先，我們確實處於——我想說，處於最新技術的前沿，與最好的矽晶片供應商合作，與他們密切合作，以確保我們通常是第一個推出產品的公司，只要矽晶片推出，我們也會推出我們的產品——但我的意思是，這不是唯一的事情。我們也為客戶提供完整的解決方案，因為我們也非常了解軟體，我們可以為他們提供產品成功所需的所有供應鏈功能。但我們始終是第一，並且在研發方面投入了大量資金，這使我們處於非常有利的地位，可以為客戶提供出色的顧問服務，指導他們該做什麼。

Many times, they come to us and ask us, we have that kind of problem, how can you help us solve that? And then we're able to give them. And one thing that really distinguish us from others is our very rich product line that we can actually also integrate our network interface cards, SmartNICs, FPGA cards or acceleration cards into our own systems and basically become a one-stop shop for our customers to get everything they need on hardware from one company.

很多時候，他們會來找我們問我們，我們有這樣的問題，你們能如何幫助我們解決？然後我們就可以給他們了。真正讓我們區別於其他公司的一點是，我們的產品線非常豐富，我們實際上還可以將我們的網路介面卡、SmartNIC、FPGA 卡或加速卡整合到我們自己的系統中，基本上成為客戶的一站式商店，讓客戶可以從一家公司獲得他們需要的所有硬體。

Thank you. And for then the investment in R&D, are there any initial thoughts? I know for sales for 2025, you're thinking low single digit. Do you have any initial estimates on R&D spend or hiring salespeople for the new year?

謝謝。那麼對於研發的投資，有什麼初步想法嗎？我知道，對於 2025 年的銷售額，您認為會是一個低個位數。您對新一年的研發支出或招募銷售人員有什麼初步估計嗎？

In general, we are not expected to expand dramatically. If at all, it will be something very specific that we need here or there, but nothing dramatic.

整體來說，我們預計不會大幅擴張。如果有的話，那也將是我們在這裡或那裡需要的某些非常具體的東西，但不會有什麼戲劇性的東西。

Thank you. I'll reach you and let more questions.

謝謝。我會聯絡您並回答更多問題。

(Operator Instructions) Ryan Koontz, Needham & Company.

（操作員指示）Ryan Koontz，Needham & Company。

Hi. Jeff Hopson again. Just maybe two more for me. I know you guys had the long-term target for gross margins of 28% to 32%. Is there any variability in the gross margin expectations for the three segments of opportunities that you laid out in the presentation?

你好。再次是傑夫霍普森。對我來說可能只需要再多兩個。我知道你們的長期目標是毛利率達到 28% 至 32%。您在簡報中列出的三個機會部分的毛利率預期是否有變化？

It's changing from product to product, from use case to use case. Still, we think the average that we'll see eventually after all -- taking all the different opportunities into play would be in the range that you mentioned, 27% to 32%. Some products obviously have more, some products have some less, but that's what we expect overall to stay in that range.

它隨著產品的不同、用例的不同而變化。不過，我們認為，考慮到所有不同的機會，最終我們看到的平均值將在您提到的範圍內，即 27% 到 32%。有些產品的含量顯然較多，有些產品的含量較少，但我們希望整體保持在該範圍內。

Perfect. Maybe just one more. You did have AI data infrastructure as one of the opportunities in SmartNIC. I guess, overall, for AI, is the technology at the edge yet? Or is that something that's too out in the future for being a real driver?

完美的。或許只剩下一個了。您確實擁有 AI 資料基礎設施，這是 SmartNIC 的機會之一。我想，整體而言，對於人工智慧而言，這項技術是否已經處於前沿？或者這對成為真正的車手來說還太過遙遠？

We think that for the edge, it's still, I would say, POC level at the moment. It's not full production right now. But definitely, it's something that comes up with customers from time to time. And we see -- still we see on the other side on -- let's say, on the training side, on the big data center side, some of our customers are providing products to that -- to those goals, those use cases. So we enjoy through them. And some other opportunities are actually maybe us doing something more direct with those kind of customers. We are pursuing both opportunities.

我們認為，就邊緣而言，目前仍處於 POC 級別。現在還沒有全面投入生產。但可以肯定的是，這是客戶時不時會遇到的問題。我們看到——我們仍然看到另一方面——比如說，在培訓方面，在大數據中心方面，我們的一些客戶正在為此提供產品——為了那些目標，那些使用案例。所以我們透過它們來享受。實際上，其他一些機會可能是我們針對這類客戶採取更直接的行動。我們正在尋求這兩個機會。

Perfect. Thank you very much for the questions.

完美的。非常感謝您的提問。

Jeff Meyers, Cobia Capital.

傑夫·邁爾斯（Jeff Meyers），Cobia Capital。

Hi. Good morning. Maybe you could talk a little bit about the FPGA opportunity, where you've been with those products, what you see going forward? And maybe also talk a little bit about gross margins on that front?

你好。早安.也許您可以稍微談談 FPGA 的機會，您已經使用這些產品了，您對未來的展望是什麼？也許還可以談談這方面的毛利率嗎？

Absolutely. So with FPGA, we see several opportunities. We've been always pretty active in the high-frequency trading. We continue to be there, but we also see the opportunities growing much more than that. We see actually opportunities together with many of the IP partners that we are partnering with. We see opportunities in streaming. We see opportunities from security. We see opportunities in network equipment companies.

絕對地。因此，借助 FPGA，我們看到了許多機會。我們在高頻交易方面一直非常活躍。我們將繼續留在那裡，但我們也看到更多機會。我們實際上與許多 IP 合作夥伴一起看到了機會。我們在串流媒體中看到了機會。我們從安全領域看到了機會。我們在網路設備公司中看到了機會。

So we see quite a lot of opportunities, either we provide the IP through one of our partners, and we're actually building quite an impressive network of IP partners working with us or actually the customer is taking upon themselves to do the actual IP development.

因此，我們看到了很多機會，要么我們透過我們的一個合作夥伴提供 IP，我們實際上正在建立一個與我們合作的令人印象深刻的 IP 合作夥伴網絡，要么實際上客戶自己承擔實際的 IP 開發任務。

So we have a few very nice opportunities, I would say, at the top of the pipeline right now. We hope that they will materialize. And definitely, from a gross margin perspective, usually, those products are somewhat better. And we hope that indeed, we can maintain a higher GP on those products. And -- but at the end of the day, I think with looking at all the opportunities we have, I don't think that the range of our overall GP will change. But definitely for those opportunities, we will probably see higher GP than the average. Operator?

所以我想說，目前我們有幾個非常好的機會處於管道的頂端。我們希望它們能夠實現。當然，從毛利率的角度來看，這些產品通常會好一些。我們確實希望這些產品能維持更高的毛利率。而且——但最終，我認為，考慮到我們擁有的所有機會，我認為我們的整體 GP 範圍不會改變。但對於那些機會，我們肯定會看到高於平均的 GP。操作員？

Okay. Thanks, guys.

好的。謝謝大家。

There are no further questions at this time. Before I ask Mr. Eizenman to go ahead with his closing statement, I would like to remind participants that a replay of this call will be available by tomorrow on Silicom's website, www.silicom-usa.com. Mr. Eizenman, would you like to make your concluding statement?

目前沒有其他問題。在我請艾森曼先生繼續他的結束語之前，我想提醒與會者，本次電話會議的重播將於明天在 Silicom 的網站 www.silicom-usa.com 上提供。艾森曼先生，您願意做最後發言嗎？

Thank you, operator. Thank you, everybody, for joining the call and for your interest in Silicom. We look forward to hosting you on our next call in three months. Good day.

謝謝您，接線生。感謝大家參加電話會議並關注 Silicom。我們期待三個月後在下次電話會議上與您會面。再會。

Thank you. This concludes Silicom's fourth-quarter 2024 results conference call. Thank you for your participation. You may go ahead and disconnect.

謝謝。這就是 Silicom 2024 年第四季業績電話會議結束。感謝您的參與。您可以繼續並斷開連線。