慧榮科技 (SIMO) 2021 Q4 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Silicon Motion Fourth Quarter 2021 Earnings Conference Call. (Operator Instructions)

美好的一天，感謝您的支持。歡迎參加 Silicon Motion 2021 年第四季度收益電話會議。 （操作員說明）

This conference call contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 as amended. Such forward-looking statements include, without limitation, statements regarding trends in the semiconductor industry and our future results of operations, financial condition and business prospects. Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them.

本次電話會議包含經修訂的 1933 年證券法第 27A 條和 1934 年證券交易法第 21E 條含義內的前瞻性陳述。此類前瞻性陳述包括但不限於有關半導體行業趨勢以及我們未來經營業績、財務狀況和業務前景的陳述。儘管此類聲明基於我們自己的信息和來自我們認為可靠的其他來源的信息，但您不應過分依賴它們。

These statements involve risks and uncertainties and actual market trends and our results may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to, continued competitive pressure in the semiconductor industry and the effect of such pressure on prices, unpredictable changes in technology and consumer demand for multimedia consumer electronics, the state of and any change in our relationship with our major customers and changes in political, economic, legal and social conditions in Taiwan.

這些陳述涉及風險和不確定性以及實際市場趨勢，由於各種原因，我們的結果可能與這些前瞻性陳述中明示或暗示的結果存在重大差異。潛在的風險和不確定性包括但不限於半導體行業的持續競爭壓力以及這種壓力對價格的影響、技術的不可預測變化和消費者對多媒體消費電子產品的需求、我們與我們的主要客戶以及台灣政治、經濟、法律和社會狀況的變化。

For additional discussion of these risks and uncertainties and other factors, please see the documents we file from time-to-time with the Securities and Exchange Commission. We assume no obligations to update any forward-looking statements, which apply only as of the date of this conference call.

有關這些風險和不確定性以及其他因素的更多討論，請參閱我們不時向證券交易委員會提交的文件。我們不承擔更新任何前瞻性陳述的義務，這些陳述僅適用於本次電話會議之日。

Please be advised that today's conference is being recorded. (Operator Instructions).

請注意，今天的會議正在錄製中。 （操作員說明）。

I'd now like to hand the conference over to your first speaker today, Mr. Chris Chaney, Director of Investor Relations and Strategy. Please go ahead, sir.

我現在想將會議交給您今天的第一位發言人，投資者關係和戰略總監 Chris Chaney 先生。請繼續，先生。

Thank you, Amber. Good morning, everyone, and welcome to Silicon Motion's Fourth Quarter 2021 Financial Results Conference Call and Webcast. As Amber mentioned, my name is Chris Chaney, I'm the Director of Investor Relations here at Silicon Motion. Joining me today on this call are Wallace Kou, our President and CEO; and Riyadh Lai, our Chief Financial Officer.

謝謝你，琥珀。大家早上好，歡迎參加 Silicon Motion 2021 年第四季度財務業績電話會議和網絡直播。正如 Amber 所提到的，我的名字是 Chris Chaney，我是 Silicon Motion 的投資者關係總監。今天和我一起參加這次電話會議的是我們的總裁兼首席執行官 Wallace Kou；和我們的首席財務官 Riyadh Lai。

Following my comments, Wallace will provide a review of our key business developments, and then Riyadh will discuss our fourth quarter and full year results and our outlook for the upcoming year. We'll then conclude with a question-and-answer period.

根據我的評論，華萊士將回顧我們的主要業務發展，然後利雅得將討論我們的第四季度和全年業績以及我們對來年的展望。然後，我們將以問答時間結束。

Before we get started, I'd like to remind you of our safe harbor policy, which Amber read at the start of this call. For a comprehensive overview of the risks involved in investing in our securities, please refer to our filings with the U.S. Securities and Exchange Commission. For more details on our financial results, please review our -- refer to our press release, which was filed on Form 6-K after the close of the market yesterday.

在我們開始之前，我想提醒您我們的安全港政策，Amber 在本次電話會議開始時閱讀了該政策。如需全面了解投資我們的證券所涉及的風險，請參閱我們提交給美國證券交易委員會的文件。有關我們財務業績的更多詳細信息，請查看我們的 - 請參閱我們的新聞稿，該新聞稿在昨天收市後以 6-K 表格提交。

This webcast will be available for replay in the Investor Relations section of our website for a limited time.

該網絡廣播將在我們網站的投資者關係部分限時重播。

To enhance investors' understanding of our ongoing economic performance, we will discuss non-GAAP information during this call. We use non-GAAP financial measures internally to evaluate and manage our operations. We have, therefore, chosen to provide this information to enable you to perform comparisons of our operating results in a manner similar to how we analyze our own operating results.

為了增強投資者對我們持續經濟表現的了解，我們將在本次電話會議中討論非公認會計原則信息。我們在內部使用非公認會計原則財務指標來評估和管理我們的運營。因此，我們選擇提供此信息，以使您能夠以類似於我們分析我們自己的經營業績的方式對我們的經營業績進行比較。

The reconciliation of GAAP to non-GAAP financial data can be found in our earnings release issued yesterday. We ask that you review it in conjunction with this call.

GAAP 與非 GAAP 財務數據的對賬可以在我們昨天發布的收益報告中找到。我們要求您在本次電話會議中對其進行審查。

And now with that, I'd like to turn the call over to Wallace.

現在有了這個，我想把電話轉給華萊士。

Thank you, Chris. Hello, everyone, and welcome to our earnings call. Silicon Motion just wrapped up a stable year, and we believe we are now gearing up for another great year. Our fourth quarter sales were up 84% year-over-year, and the full year sales grew 71%. Our fourth quarter earnings per ADS were up over 120% year-over-year, and full year earnings grew over 90%. Our 2021 business activities were extremely strong, and we are seeing much of this momentum continuing into 2022. Last year, demand for our SSD controllers using OEM program for PC and other client devices as well as our eMMC and UFS embedded storage controllers used in smartphones, automotive, IoT and smart devices was tremendous. And demand from OEMs continue to be very strong.

謝謝你，克里斯。大家好，歡迎來到我們的財報電話會議。 Silicon Motion 剛剛結束了穩定的一年，我們相信我們現在正為又一個偉大的一年做準備。我們第四季度的銷售額同比增長 84%，全年銷售額增長 71%。我們第四季度的每 ADS 收益同比增長超過 120%，全年收益增長超過 90%。我們 2021 年的業務活動非常強勁，我們看到這種勢頭將持續到 2022 年。去年，對我們使用 OEM 程序的用於 PC 和其他客戶端設備的 SSD 控制器以及我們用於智能手機的 eMMC 和 UFS 嵌入式存儲控制器的需求、汽車、物聯網和智能設備是巨大的。來自原始設備製造商的需求仍然非常強勁。

Last year, we delivered corporate record sales. Despite our very strong sales, we could not meet the full demand of customers who are building SSD and other storage devices for OEM in many categories of applications. We are now able to meet their full demand because our business was supply-constrained, constrained by limited availability of foundry wafer supply necessary for fabricating RICs. Today, supply continued to be very tight and we don't expect this situation to change this year. As previously discussed, our audit book was significantly backlogged last year. And today, this backlog remain significant. Early last year, we originally communicated a 20% to 30% sales growth guidance for full year 2021. This revenue guidance was based on both meaningful incremental foundry wafer supply allocated to us as well as existing product mix and pricing arrangements. From that starting point, our operations team was able to meaningfully upsize sale growth to 71% for full year 2021 by optimizing our product mix, customer allocation and pricing.

去年，我們實現了公司創紀錄的銷售額。儘管我們的銷售非常強勁，但我們無法滿足在許多類別的應用中為 OEM 構建 SSD 和其他存儲設備的客戶的全部需求。我們現在能夠滿足他們的全部需求，因為我們的業務受到供應限制，受到製造 RIC 所需的代工晶圓供應有限的限制。今天，供應仍然非常緊張，我們預計這種情況今年不會改變。如前所述，我們的審計書去年大量積壓。而今天，這種積壓仍然很重要。去年初，我們最初傳達了 2021 年全年 20% 至 30% 的銷售增長指導。該收入指導基於分配給我們的有意義的增量代工晶圓供應以及現有的產品組合和定價安排。從這個起點開始，我們的運營團隊通過優化我們的產品組合、客戶分配和定價，將 2021 年全年的銷售增長率大幅提升至 71%。

Now turning to this year. For full year 2022, we have again received meaningful incremental wafer supply from our primary foundry partner. Based on this incremental wafer supply, we will be able to grow full year sales 20% to 30%. We believe, however, that there are opportunity for us to grow even faster than this baseline range. And our operations team has already begun implementing strategic initiatives with the aim of delivering upside to baseline. Upside opportunity include better product optimization, additional wafer supply and pricing. I look forward to sharing with you more on this in the following quarters as we can successfully execute.

現在轉向今年。在 2022 年全年，我們再次從我們的主要代工合作夥伴那裡獲得了有意義的增量晶圓供應。基於這一增量晶圓供應，我們將能夠將全年銷售額增長 20% 至 30%。然而，我們相信，我們有機會以比這個基線範圍更快的速度增長。我們的運營團隊已經開始實施戰略計劃，旨在為基線提供上行空間。上行機會包括更好的產品優化、額外的晶圓供應和定價。我期待在接下來的幾個季度與您分享更多關於這方面的信息，因為我們可以成功執行。

Sales of both our SSD controller and eMMC+UFS controller were extremely strong. Now let me talk about each one of these 2 key product lines. Full year sale of SSD controller grew 75% to 80%, significantly faster than the market. In 2021, we likely gained close to 10 percentage points of market share, with full year client SSD controller market share today, that is roughly in the 35% to 40% range. our SSD controller growth was driven by extensive adoption of SSD by PC OEM using our controllers. Sale is almost every one of our key customers involving OEM program, whether NAND flash makers or module makers, grew strongly. And we expect the significance of our sales to OEM to continue to increase. The portion of our SSD controller using OEM program grew to account for well over half of our SSD controller sales in the second half of 2021, significantly higher than 1/3 the year before. To address our controller for channel market, we anticipate the significance of OEM program to grow further and account for close to 2/3 of our overall SSD controller sales this year.

我們的 SSD 控制器和 eMMC+UFS 控制器的銷售都非常強勁。現在讓我來談談這兩條關鍵產品線中的每一條。 SSD控制器全年銷售額增長75%至80%，明顯快於市場。到 2021 年，我們可能會獲得接近 10 個百分點的市場份額，今天全年客戶端 SSD 控制器的市場份額大致在 35% 到 40% 的範圍內。我們的 SSD 控制器增長得益於 PC OEM 使用我們的控制器廣泛採用 SSD。銷售幾乎是我們每一個涉及 OEM 計劃的主要客戶，無論是 NAND 閃存製造商還是模塊製造商，都強勁增長。我們預計我們的銷售對 OEM 的重要性將繼續增加。在 2021 年下半年，我們使用 OEM 計劃的 SSD 控制器部分增長到我們 SSD 控制器銷售額的一半以上，顯著高於前一年的 1/3。為了解決我們的渠道市場控制器問題，我們預計 OEM 計劃的重要性將進一步增長，並占我們今年 SSD 控制器整體銷售額的近 2/3。

Last year, we saw the continued ramp-up in sales of our PCIe Gen3 SSD controller, which have been widely adopted by PC OEMs. And in the second half of this year, we launched the first generation of our PCIe Gen4 series of SSD controller, also to OEM. The rollout of Gen4 with OEM lagged our initial launch for our Gen4 into the channel market by well over a year because of extensive verification and testing by both our direct customers and the PC OEMs. We are now initiating the launch of our second-generation PCIe Gen4 controller and expect Gen4 to account for a majority of SSD controller sales this year, which coincide with accelerating broad-based adoption of PCIe Gen4 SSD by PC OEMs.

去年，我們的 PCIe Gen3 SSD 控制器銷量持續增長，已被 PC OEM 廣泛採用。並且在今年下半年，我們推出了第一代 PCIe Gen4 系列 SSD 控制器，同樣面向 OEM。由於我們的直接客戶和 PC OEM 的廣泛驗證和測試，與 OEM 一起推出 Gen4 比我們首次將 Gen4 推出渠道市場晚了一年多。我們現在開始推出我們的第二代 PCIe Gen4 控制器，並預計 Gen4 將佔今年 SSD 控制器銷售的大部分，這與 PC OEM 加速廣泛採用 PCIe Gen4 SSD 相吻合。

We believe that we will continue to gain market share this year. Based on the design win and sale projection, we expect our controller to be in half of all of PCIe Gen4 socket at PC OEM by the end of this year or early next year when our Gen4 program are scaled.

我們相信今年我們將繼續獲得市場份額。根據設計獲勝和銷售預測，我們預計到今年年底或明年初，當我們的 Gen4 計劃擴大時，我們的控制器將佔 PC OEM 的所有 PCIe Gen4 插槽的一半。

Additionally, our NAND flash customers continue to work with game console OEMs for the adoption of our SSD controller in their next major device upgrade cycle next year. It is likely that PCIe Gen4 will last a few years since Intel, AMD both continue to bring new upgrade variant of CPU with PCIe Gen4 to the market. Similarly, we are preparing for the launch of our third-generation PCIe Gen4 controller next year before transitioning to PCIe Gen5 in the following year.

此外，我們的 NAND 閃存客戶繼續與遊戲機 OEM 合作，以便在明年的下一個主要設備升級週期中採用我們的 SSD 控制器。 PCIe Gen4 很可能會持續幾年，因為 Intel、AMD 都繼續將帶有 PCIe Gen4 的 CPU 的新升級版本推向市場。同樣，我們正準備明年推出我們的第三代 PCIe Gen4 控制器，然後在明年過渡到 PCIe Gen5。

Before moving to our eMMC+UFS controller, let me provide an update on our enterprise SSD controllers. As many of you know, we have been investing actively for several years in enterprise-class SSD controller R&D. We have been investing in our understanding of the large, complex and fragmented market and the technology necessary for bringing differentiated and compelling solution to customers. The design cycle in the enterprise market are also much longer than the client and mobile OEM markets. Our current product before the upcoming launch of our flagship enterprise-class PCIe Gen5 controller are finally completing final customer testing and qualification. And moving to production sales this year. We are currently rolling out our enterprise-class SATA SSD controller for the large-volume, long-tail, well-established enterprise market; and separately, our turnkey PCIe Gen4 SSD controller with robust firmware that is performance-tuned for certain enterprise data center applications. And additionally, we are on track to begin sampling our flagship SM8366 PCIe Gen5 SSD controller in the second half of this year. We believe our Gen5 is uniquely positioned with both very competitive operation performance and robust architecture and is also compellingly differentiated with future design desired by hyperscale and enterprise customers, such as a highly customization firmware, performance shaping capability and optimize data placement technologies.

在轉向我們的 eMMC+UFS 控制器之前，讓我先介紹一下我們企業級 SSD 控制器的更新。眾所周知，我們多年來一直在積極投資於企業級 SSD 控制器的研發。我們一直在投資於我們對龐大、複雜和分散的市場的理解，以及為客戶帶來差異化和引人注目的解決方案所需的技術。企業市場的設計週期也比客戶端和移動 OEM 市場長得多。在即將推出我們的旗艦企業級 PCIe Gen5 控制器之前，我們當前的產品終於完成了最終的客戶測試和認證。並在今年轉向生產銷售。我們目前正在為大容量、長尾、成熟的企業市場推出我們的企業級 SATA SSD 控制器；另外，我們的交鑰匙 PCIe Gen4 SSD 控制器具有強大的固件，可針對某些企業數據中心應用進行性能調整。此外，我們有望在今年下半年開始對我們的旗艦 SM8366 PCIe Gen5 SSD 控制器進行採樣。我們相信，我們的 Gen5 具有獨特的定位，具有極具競爭力的運營性能和強大的架構，並且在超大規模和企業客戶所需的未來設計方面也具有引人注目的差異化，例如高度定制的固件、性能塑造能力和優化數據放置技術。

We believe we are well positioned to repeat the success we have achieving client SSD controller in the enterprise SSD controller area as well.

我們相信我們有能力重複我們在企業 SSD 控制器領域實現客戶端 SSD 控制器的成功。

Now let me turn to our eMMC+UFS controllers. Last year, sale of both eMMC controller and UFS controller roughly doubled, with growth coming primarily from market share gain. Sales of UFS controller grew strongly as our U.S. NAND flash customers continue to expand aggressively to build its market position with smartphone OEMs. Our UFS controller sales also benefited from growing sales to other customers. We are seeing renewed growth in sales of our plastic eMMC controllers from the proliferation of new applications, such as automotive with ADAS, telematics and entertainment systems that use eMMC; but also from the opportunity clearly as many of the NAND flash makers began to exit from this order load capacity storage technology. We have benefited from the supplying controller to module makers stepping into the market. Additionally, a few NAND flash makers who are facing foundry wafer supply issues are also outsourcing eMMC controller from us. This is an attractive market for us because we are the only meaningful merchant supplier of eMMC controllers, and the eMMC market is relatively big with annual market sales volume of approximately 1.5 billion units.

現在讓我談談我們的 eMMC+UFS 控制器。去年，eMMC 控制器和 UFS 控制器的銷量都大致翻了一番，增長主要來自市場份額的增長。隨著我們的美國 NAND 閃存客戶繼續積極擴張以建立其與智能手機 OEM 的市場地位，UFS 控制器的銷售強勁增長。我們的 UFS 控制器銷售也受益於對其他客戶的銷售增長。我們看到塑料 eMMC 控制器的銷售額因新應用的激增而重新增長，例如帶有 ADAS 的汽車、使用 eMMC 的遠程信息處理和娛樂系統；但也從機會上看，許多 NAND 閃存製造商開始從這個訂單中退出負載容量存儲技術。我們受益於為進入市場的模塊製造商提供控制器。此外，一些面臨晶圓代工供應問題的NAND閃存製造商也將eMMC控制器外包給我們。這對我們來說是一個有吸引力的市場，因為我們是唯一有意義的 eMMC 控制器商家供應商，而且 eMMC 市場規模較大，年市場銷量約為 15 億台。

Now I will turn the call over to Riyadh to discuss our financial results and our outlook.

現在我將把電話轉給利雅得，討論我們的財務業績和前景。

Thank you, Wallace, and good morning, everyone. I will discuss additional details of our fourth quarter and full year results and then provide our guidance. Please note that my comments today will focus primarily on our non-GAAP results unless otherwise specifically noted. A reconciliation of our GAAP to non-GAAP data is included with the earnings release issued yesterday.

謝謝你，華萊士，大家早上好。我將討論我們第四季度和全年業績的更多細節，然後提供我們的指導。請注意，除非另有特別說明，否則我今天的評論將主要集中在我們的非公認會計原則結果上。昨天發布的收益報告中包含了我們的 GAAP 與非 GAAP 數據的對賬。

In the fourth quarter, sales were $264 million, growing 4% sequentially. Earnings per ADS were $1.90, which was 12% higher sequentially. For the full year, sales were $922 million, up 71% versus the prior year. Earnings per ADS were $6.21, up 92% from the prior year.

第四季度銷售額為 2.64 億美元，環比增長 4%。每份 ADS 收益為 1.90 美元，環比增長 12%。全年銷售額為 9.22 億美元，比上年增長 71%。每份 ADS 收益為 6.21 美元，比上年增長 92%。

Now I'll review the performance of our 3 key products. SSD controller sales grew 15% to 20% sequentially in the fourth quarter, reversing third quarter's approximately -- flat sequential -- fourth quarter approximately flat sequentially as we allocated production back to SSD controllers. Full year SSD controller sales grew 75% to 80%, far exceeding the market's growth rate as we gain significant market share. Full year SSD controller sales accounted for approximately 55% to 60% of our total sales. eMMC+UFS controller sales declined 5% to 10% sequentially, reversing third quarter sharp sequential growth as we production with our SSD controllers. Full year eMMC+UFS sales grew 105% and -- between 105% and 110%, far exceeding market growth as we gained significant market shares. Full year eMMC+UFS sales accounted for approximately 30% to 35% of our total sales.

現在我將回顧我們 3 個關鍵產品的性能。 SSD 控制器銷售額在第四季度環比增長 15% 至 20%，扭轉了第三季度大致持平的趨勢——第四季度大致持平，因為我們將生產分配回 SSD 控制器。全年 SSD 控制器銷售額增長 75% 至 80%，遠遠超過市場增長率，因為我們獲得了可觀的市場份額。全年 SSD 控制器銷售額約占我們總銷售額的 55% 至 60%。 eMMC+UFS 控制器銷量環比下降 5% 至 10%，扭轉了第三季度的急劇環比增長，因為我們使用 SSD 控制器進行生產。全年 eMMC+UFS 銷售額增長了 105% 和 - 105% 到 110% 之間，遠遠超過了市場增長，因為我們獲得了可觀的市場份額。全年 eMMC+UFS 銷售額約占我們總銷售額的 30% 至 35%。

SSD solutions sales in the fourth quarter grew 5% to 10% sequentially. For the full year, SSD solutions sales declined 5% to 10% and accounted for approximately 5% to 10% of our total sales.

第四季度 SSD 解決方案銷售額環比增長 5% 至 10%。全年，SSD 解決方案銷售額下降 5% 至 10%，約占我們總銷售額的 5% 至 10%。

Gross margin in the fourth quarter were 49.9%, consistent with the prior quarter. For the full year, gross margin was 50.4%, 1.3 percentage points higher than the prior year's 49.2%, as we focus on optimizing our product mix and customer allocation and repricing our products to account for higher costs.

第四季度毛利率為 49.9%，與上一季度一致。全年毛利率為 50.4%，比上年的 49.2% 提高 1.3 個百分點，因為我們專注於優化我們的產品組合和客戶分配以及重新定價我們的產品以應對更高的成本。

Operating expenses in the fourth quarter were $50.3 million, $2.7 million lower than the prior quarter primarily due to sequentially lower tape-out expenses. Operating expenses for the full year were $195.5 million, up $47.8 million from the prior year, primarily due to higher bonuses. Tape-out expenses were also higher as were salaries as we expanded our headcount, mainly R&D engineers and implemented routine wage increases. Operating expenses as a percentage of revenue for the full year were 21% for the full year, down from 27% in the prior year.

第四季度的運營費用為 5030 萬美元，比上一季度減少 270 萬美元，主要是由於流片費用環比下降。全年運營費用為 1.955 億美元，比上年增加 4780 萬美元，主要是由於更高的獎金。隨著我們擴大員工人數（主要是研發工程師）並實施例行加薪，流片費用和工資也較高。全年營業費用佔收入的百分比為 21%，低於上年的 27%。

Operating margin increased from 29.4% in the prior quarter to 30.9% in the fourth quarter, the highest in our recent corporate history. Full year operating margin was 29.2%, up significantly from 21.8% in the prior year as we benefited from significant operating leverage and a slightly higher gross margin.

營業利潤率從上一季度的 29.4% 增加到第四季度的 30.9%，是我們近期公司歷史上的最高水平。全年營業利潤率為 29.2%，顯著高於上年的 21.8%，因為我們受益於顯著的經營槓桿和略高的毛利率。

Our effective tax rate in the fourth quarter was temporarily lower at 70%. For the full year, our effective tax rate was 19%, close to our 20% mobile tax rate.

我們第四季度的有效稅率暫時較低，為 70%。全年，我們的有效稅率為 19%，接近我們 20% 的移動稅率。

Stock-based compensation and operating expenses, which we exclude from our non-GAAP results, was $9 million in the fourth quarter at the low end of our $9 million to $10 million guidance. We had $405.5 million (sic) [$415.5 million] of cash, cash equivalents, restricted cash and short-term investments at the end of the fourth quarter, comparable to the $419.4 million at the end of the third quarter.

我們從非公認會計原則結果中排除的基於股票的薪酬和運營費用在第四季度為 900 萬美元，處於我們 900 萬美元至 1000 萬美元指導的低端。截至第四季度末，我們擁有 4.055 億美元（原文如此）[4.155 億美元] 的現金、現金等價物、受限現金和短期投資，與第三季度末的 4.194 億美元相當。

Our inventory levels remain extremely lean as foundry capacity continues to be very tight and demand remains robust. In the fourth quarter, we had 110 days of inventory, 2 days less than the prior quarter and 18 days less than a year ago. Our controller inventory is even leaner as 30% of our inventory at the end of December -- or leaner at the end of December for -- as 30% of our inventory at the end of December are for SSD solution, and SSD solutions are less than 10% of total sales. We currently only have a couple of weeks of controller finished products in inventory to sell.

由於代工產能繼續非常緊張且需求保持強勁，我們的庫存水平仍然非常低。在第四季度，我們有 110 天的庫存，比上一季度少 2 天，比一年前少 18 天。我們的控制器庫存在 12 月底甚至更精簡為 30% 的庫存 - 或者在 12 月底更精簡 - 因為我們在 12 月底的庫存中有 30% 用於 SSD 解決方案，而 SSD 解決方案更少佔總銷售額的 10% 以上。我們目前只有幾週的庫存控制器成品可供出售。

We provide -- we paid $17.4 million in dividend to shareholders, the first quarterly installment of our $2 per ADS annual dividend that was declared last October. We are aggressively repurchasing our shares. In the fourth quarter, we spent $50 million repurchasing our shares. We expect to repurchase another $50 million in January and the remaining $100 million by June of this year.

我們提供——我們向股東支付了 1740 萬美元的股息，這是我們去年 10 月宣布的每 ADS 年度股息 2 美元的第一季度分期付款。我們正在積極回購我們的股票。在第四季度，我們花費了 5000 萬美元回購了我們的股票。我們預計將在 1 月份再回購 5000 萬美元，到今年 6 月再回購剩餘的 1 億美元。

In terms of other major uses of cash, we also had $11.2 million in CapEx.

在現金的其他主要用途方面，我們還有 1120 萬美元的資本支出。

Now let me turn to our guidance and forward-looking business trends, starting with our revenue guidance. For the full year, we are expecting revenue to grow 20% to 30%. This is revenue growth forecast -- this revenue growth forecast is based entirely on incremental foundry wafer supply. Also note, we received more incremental wafer supply allocation in the second half of this year versus in the first half. And the timing of this is an important factor for driving our sequential growth through the rest of this year. As well as I'd mentioned, this is our baseline target range, and we are undertaking initiatives to deliver upside to this. The upsizing of our revenue guidance is dependent on the successful execution of certain operating initiatives.

現在讓我談談我們的指導和前瞻性業務趨勢，從我們的收入指導開始。全年，我們預計收入將增長 20% 至 30%。這是收入增長預測——這個收入增長預測完全基於增量代工晶圓供應。另請注意，與上半年相比，我們在今年下半年獲得了更多的增量晶圓供應分配。而這個時機是推動我們今年剩餘時間連續增長的一個重要因素。正如我所提到的，這是我們的基準目標範圍，我們正在採取措施來實現這一目標。我們收入指引的上調取決於某些運營計劃的成功執行。

First quarter revenue is expected to decline 10% to 15% sequentially. This sequential decline is primarily the result of 2 factors: timing of our wafer supply and China channel market inventory cleanup. We received meaningful incremental wafer supply this year, but the timing of the availability of supply is not linear and will impact us in Q1. Wafer supply for certain key nodes in Q1 will be less than in Q4, which means we will have fewer high-demand parts to sell. As I had said a few minutes ago, we are currently operating at very low inventory levels with just a couple of weeks of finished goods of controllers. Furthermore, for parts with better supply availability, module makers offering in China's channel market have reduced procurement to clean up their inventory before the long Chinese New Year holiday. We believe this action is temporary as module makers are trying to reduce their inventory holding risk before the long holiday. Positively, we are seeing recovery of the channel market, both in terms of sentiment as well as business activity as module makers are now more willing to build products than a quarter ago. Our module maker customers targeting the channel market are now actively discussing with us about controllers to support their upcoming NAND flash procurement. Fortunately, our new OEM programs are not affected as these programs -- these new programs are only beginning and will pick up and accelerate over the next few quarters.

預計第一季度收入將環比下降 10% 至 15%。這種連續下降主要是兩個因素的結果：我們的晶圓供應時間和中國渠道市場庫存清理。今年我們收到了有意義的增量晶圓供應，但供應的時間不是線性的，將在第一季度影響我們。第一季度某些關鍵節點的晶圓供應將少於第四季度，這意味著我們將有更少的高需求零件可供銷售。正如我幾分鐘前所說，我們目前的庫存水平非常低，只有幾週的控制器成品。此外，對於供應較好的零部件，在中國渠道市場供應的組件製造商減少了採購，以在春節長假前清理庫存。我們認為這一行動是暫時的，因為組件製造商正試圖在長假前降低其庫存風險。積極地，我們看到了渠道市場的複蘇，無論是在情緒方面還是在商業活動方面，因為模塊製造商現在比一個季度前更願意製造產品。我們瞄準渠道市場的模塊製造商客戶現在正在與我們積極討論控制器，以支持他們即將進行的 NAND 閃存採購。幸運的是，我們的新 OEM 計劃並未受到這些計劃的影響——這些新計劃才剛剛開始，並將在接下來的幾個季度中加速發展。

We are already 1/3 of the way through the first quarter and see good improvement in sales next quarter. We expect sequential growth through the rest of the year with growth coming from the scheduled ramp of new OEM programs, which will be supported by the timing of incremental wafer supply already allocated to us.

我們已經完成了第一季度的 1/3，並且看到下個季度的銷售情況會有很好的改善。我們預計今年剩餘時間將連續增長，增長來自新 OEM 計劃的計劃增長，這將得到已分配給我們的增量晶圓供應時間的支持。

Let me now turn to our gross margin guidance. For the full year, we are expecting gross margin in the 49% to 51% range. We believe we can continue to manage our products around our 50% target gross margin. First quarter gross margin should be in the 49.5% to 51.5% range.

現在讓我談談我們的毛利率指導。全年，我們預計毛利率在 49% 至 51% 之間。我們相信我們可以繼續在 50% 的目標毛利率附近管理我們的產品。第一季度毛利率應在 49.5% 至 51.5% 範圍內。

Turning to our operating margin guidance. For the full year, we are expecting operating margin in the 29% to 31% range. We are delighted that we are now delivering towards our 30% target operating margin. First quarter operating margin should be in the range of 27.5% to 29.5%, lower than in the fourth quarter because of higher tape-out expenses.

轉向我們的營業利潤率指導。全年，我們預計營業利潤率在 29% 至 31% 之間。我們很高興我們現在實現了 30% 的目標營業利潤率。第一季度營業利潤率應在 27.5% 至 29.5% 之間，低於第四季度，因為流片費用較高。

And for our other key modeling assumptions. For the full year, we expect stock-based compensation to be in the $22 million to $24 million range. First quarter stock-based compensation should be in the $5 million to $6 million range. We expect our effective tax rate for 2022 to be approximately 20%. For the full year, we expect approximately $45 million of CapEx, of which $18 million will be for routine CapEx and $27 million for our Hsinchu and Taipei office building construction. First quarter CapEx should be approximately $14 million, of which $6 million will be for routine CapEx and $8 million for our office building.

對於我們的其他關鍵建模假設。全年，我們預計基於股票的薪酬將在 2200 萬美元至 2400 萬美元之間。第一季度基於股票的薪酬應該在 500 萬美元到 600 萬美元之間。我們預計 2022 年的有效稅率約為 20%。全年，我們預計資本支出約為 4500 萬美元，其中 1800 萬美元將用於常規資本支出，2700 萬美元將用於我們的新竹和台北辦公樓建設。第一季度資本支出應約為 1400 萬美元，其中 600 萬美元用於常規資本支出，800 萬美元用於我們的辦公樓。

This concludes our prepared remarks. We will now open the call to your questions.

我們準備好的評論到此結束。我們現在將打開您的問題的電話。

(Operator Instructions) Our first question comes from the line of Craig Ellis from B. Riley Securities.

（操作員說明）我們的第一個問題來自 B. Riley Securities 的 Craig Ellis。

Team, congratulations on the very strong performance in calendar '21. Wallace, I wanted to start off with maybe a bigger picture, longer-term question. So as I look back at [2021], you had strong share gain and growth in really all of your markets, and it looks like that demand strength and that order strength is persistent in 2022. And then it sounds like SSD solutions has a new product ramp that could augment your product mix and growth in 2023. So the question is this, as you look at the business and the share gain potential across SSD controllers, eMMC and UFS, put in context when you last saw this type of growth for the company and your confidence today in the ability to execute against that growth the way that you did last year.

團隊，恭喜您在 21 年日曆中的出色表現。華萊士，我想從一個更大的、更長期的問題開始。因此，當我回顧 [2021] 時，您實際上在所有市場中都有強勁的份額增長和增長，而且這種需求強度和訂單強度似乎在 2022 年持續存在。然後聽起來 SSD 解決方案有一個新的2023 年可能會增加您的產品組合和增長的產品增長。所以問題是，當您查看 SSD 控制器、eMMC 和 UFS 之間的業務和份額增長潛力時，請結合您上次看到這種增長時的背景公司以及您今天對按照去年的方式實現增長的能力的信心。

Great. I think you asked very good questions. If you look at the big picture, if we can secure enough wafer supply, we believe the growth momentum will continue for the next 5 -- 3 to 5 years. And we do see we have a lot of a headroom to grow, particularly in client SSD, eMMC and UFS controller. For clients SSD, we believe by 2023, we should have at least 1 major client SSD project for all NAND makers, and we have confidence to achieve that. And we believe our eMMC controller will continue to grow with benefiting from the NAND maker. They are outsourcing. Some NAND maker are also into us, and we grow with incremental all the new applications for IoT device and smart devices, including low-end smartphone. UFS, we also gained market share with additional customers. We believe the momentum will continue to grow when UFS becomes more popular in the smartphone market. So I think if we can keep execution for all our major project program and we can recruit talent in R&D in time and we get a sufficient wafer, the growth momentum will continue for the next 3 to 5 years.

偉大的。我認為你提出了非常好的問題。從大局來看，如果我們能夠確保足夠的晶圓供應，我們相信未來5-3至5年的增長勢頭將持續。我們確實看到我們有很大的增長空間，特別是在客戶端 SSD、eMMC 和 UFS 控制器方面。對於客戶 SSD，我們認為到 2023 年，我們應該為所有 NAND 製造商提供至少 1 個主要客戶 SSD 項目，我們有信心實現這一目標。我們相信我們的 eMMC 控制器將繼續受益於 NAND 製造商的發展。他們在外包。一些 NAND 製造商也加入了我們，我們隨著物聯網設備和智能設備（包括低端智能手機）的所有新應用的增加而增長。 UFS，我們還獲得了更多客戶的市場份額。我們相信，當 UFS 在智能手機市場變得更受歡迎時，這種勢頭將繼續增長。所以我認為，如果我們能夠繼續執行我們所有的重大項目計劃，我們能夠及時招聘研發人才並獲得足夠的晶圓，那麼未來3到5年的增長勢頭將持續下去。

That's helpful. And for my follow-up question, I'll switch it over to Riyadh. Riyadh, one of the things that characterized last year was the 4 different initiatives that the company was executing on regarding cost management, fulfillment, et cetera, to execute gross margin, which played out very well through the year. As we look at the first quarter's guidance and the full year guidance, it does imply some gross margin decrease through the year. The question is this: what is the momentum that you have operationally on things that benefited gross margin last year? And what are some of the potential pressures on gross margin as you look through the year? And what levers do you have to offset those?

這很有幫助。對於我的後續問題，我將把它轉到利雅得。利雅得，去年的特點之一是該公司在成本管理、履行等方面執行的 4 項不同舉措，以執行毛利率，這些舉措在這一年中表現得非常好。當我們查看第一季度的指導和全年指導時，它確實意味著全年毛利率有所下降。問題是：你在去年有利於毛利率的事情上的運營勢頭是什麼？縱觀這一年，毛利率面臨哪些潛在壓力？你有什麼槓桿來抵消這些？

Craig, we are continuing to look at our business and look for ways to improve that, similar to what we were doing with our business a year ago. We are -- there are certain initiatives relating to the product mix, pricing, wafers and other costs that we are looking into which we plan to execute. And so while the growth -- the baseline remains the same. The baseline is what we had communicated. There are potentially opportunities where we can deliver better results in terms of top line and also better results in gross margin relating to the upselling of a richer mix of products that we did last year; optimization of our product mix; allocation to customers, which, again, we also did quite nicely last year; and also better pricing discipline which we will continue to press ahead this year. And furthermore, on the cost of sales side, we also continue to look very carefully about our manufacturing processes. Where there are opportunities to tune our yields to reflect better costing, we'll certainly be pressing on that. So this is in terms of both the fabrication of the products as well as the back end and other elements of our manufacturing processes. There are opportunities that we're continuing to look into in order to improve our profitability.

克雷格，我們將繼續關注我們的業務並尋找改進方法，就像我們一年前對業務所做的那樣。我們正在研究我們計劃執行的與產品組合、定價、晶圓和其他成本相關的某些舉措。因此，雖然增長 - 基線保持不變。基線是我們所傳達的。有潛在的機會，我們可以在收入方面取得更好的結果，並在與我們去年所做的更豐富產品組合的追加銷售相關的毛利率方面取得更好的結果；優化我們的產品組合；分配給客戶，同樣，我們去年也做得很好；以及更好的定價紀律，我們將在今年繼續推進。此外，在銷售成本方面，我們還繼續非常仔細地研究我們的製造流程。如果有機會調整我們的收益率以反映更好的成本，我們肯定會對此施加壓力。因此，這既涉及產品的製造，也涉及我們製造過程的後端和其他元素。我們正在繼續尋找機會以提高我們的盈利能力。

That's helpful. And if I could just sneak in one more before hopping back in the queue. Congratulations on the strong start on the share buyback program. And I appreciate all the visibility into how you execute the program as you go through the first half of the year. And at the risk of putting the cart a little bit before the horse, can you just talk about the executive teams and the Board's view on what could happen after the first half of the year? Is share buyback something the company would entertain in the back half given the level of operating cash flow and the degree to which free cash flow is well above CapEx needs for the new building that's underway and the dividend program that's been nicely enhanced of late?

這很有幫助。如果我可以在跳回隊列之前再偷偷溜進去一次。祝賀股票回購計劃的強勁開端。我很欣賞您在今年上半年如何執行該計劃的所有可見性。冒著本末倒置的風險，您能否談談執行團隊和董事會對上半年後可能發生的事情的看法？考慮到運營現金流水平以及自由現金流遠高於正在進行的新建築的資本支出需求以及最近得到很好增強的股息計劃，公司是否會在後半部分進行股票回購？

Craig, that's a great question. We have a business that's highly cash generative. If you were to look at our fourth quarter, our cash balance at the start of the quarter and end of the quarter is a little changed despite $50 million of share repurchase, over $17 million of dividends paid to shareholders plus CapEx and other elements. So we clearly have the cash flow to continue to do a lot of attractive initiatives to boost our shareholder value. But let us first complete our current shareholder program -- share buyback program, and we can certainly look into other initiatives or continuation of this type of initiative later this year.

克雷格，這是一個很好的問題。我們的業務具有很高的現金生成能力。如果您查看我們的第四季度，儘管進行了 5000 萬美元的股票回購、超過 1700 萬美元的股息支付給股東以及資本支出和其他因素，我們在本季度初和本季度末的現金餘額略有變化。因此，我們顯然有足夠的現金流繼續採取許多有吸引力的舉措來提高我們的股東價值。但讓我們首先完成我們目前的股東計劃——股票回購計劃，我們當然可以在今年晚些時候研究其他舉措或此類舉措的延續。

Our next question comes from the line of Raji Gill from Needham & Company.

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

And my congratulations on the stellar results on the '21. Wallace and Riyadh, when you look to calendar '22, and you were very clear about saying that the 20% to 30% outlook is a baseline target and it will be based on -- and the upside to be driven by certain variables, incremental wafer supply, product optimization, et cetera, I'm wondering how you're thinking about the timing of that. You mentioned in Q1 that the sequential decline in revenue is driven because of the timing of capacity not happening. So my question is, how confident are you that you will get the incremental capacity at the timing that if you need? And what reassurance is TSMC providing you that gives you that confidence, not only to -- to provide a 20% to 30% outlook but essentially say there could be upside to that if we get more supply throughout the year?

我祝賀 21 年的出色成績。華萊士和利雅得，當您查看 22 年日曆時，您非常清楚地說 20% 至 30% 的前景是一個基線目標，它將基於 - 以及由某些變量驅動的上行空間，增量晶圓供應、產品優化等，我想知道你是如何考慮時間的。您在第一季度提到，收入的連續下降是由於產能沒有發生的時機。所以我的問題是，如果你需要，你有多大信心在需要的時候獲得增量容量？台積電給你什麼保證，讓你有信心，不僅提供 20% 到 30% 的前景，而且基本上說，如果我們全年獲得更多供應，這可能會有上行空間？

So I think you raised a very good question. So how confident we are regarding from baseline guidance to move to the upside? I think the primary rely on the additional wafer supply from TSMC as well as how we can pull in the wafer allocation to us from second half to first half. We -- I think, as we mentioned, we are in severe shortage in certain technology nodes, including 55-nanometer and all advanced technology nodes, 16-nanometer and 12-nanometer. However, I think we are comfortable in 28-nanometer wafer supply. We are just [balancing 49-nanometer]. So if we cannot get any additional wafer supply from TSMC, it all depends on how we can fully utilize 28-nanometer with a better product mix and with the pricing with the customer. But so far, we believe we could be benefiting from some of potential wafer supply with our primary foundry supplier. And we are discussing almost every week, and we see there's a positive momentum. In addition, our primary customer also helping us to get wafer supply from TSMC. I think that momentum and direction will be very helpful and positive.

所以我認為你提出了一個非常好的問題。那麼，我們對從基線指導轉向上行的信心有多大？我認為主要依賴於台積電的額外晶圓供應，以及我們如何從下半年到上半年將晶圓分配給我們。我們——我認為，正如我們所提到的，我們在某些技術節點上嚴重短缺，包括 55 納米和所有先進技術節點、16 納米和 12 納米。但是，我認為我們對 28 納米晶圓供應感到滿意。我們只是 [平衡 49 納米]。因此，如果我們無法從台積電獲得任何額外的晶圓供應，這完全取決於我們如何能夠充分利用 28 納米，並提供更好的產品組合以及與客戶一起定價。但到目前為止，我們相信我們可以從我們的主要代工廠供應商的一些潛在晶圓供應中受益。我們幾乎每週都在討論，我們看到了積極的勢頭。此外，我們的主要客戶也幫助我們從台積電獲得晶圓供應。我認為勢頭和方向將非常有幫助和積極。

Okay. Great. That's helpful to understand. And the -- starting on Q1, the channel inventory cleanup in China, which is leading to a decline in Q1 2022. You mentioned that these module makers are starting to build more inventory or indications that they will do that post the holiday season to support the NAND flash procurement. I'm wondering if you could kind of elaborate a little bit further on how the module makers are thinking about their products this year. The OEM programs are very strong, and that's -- and it's great to hear that that's represent 2/3 of the controller sales. But trying to get a bit of understanding of the module makers as we progress throughout this year.

好的。偉大的。這有助於理解。還有——從第一季度開始，中國的渠道庫存清理導致 2022 年第一季度出現下降。您提到這些組件製造商開始增加庫存或表明他們將在假期後這樣做以支持NAND閃存採購。我想知道您是否可以進一步詳細說明模塊製造商今年如何考慮他們的產品。 OEM 計劃非常強大，而且很高興聽到這代表了控制器銷售額的 2/3。但隨著我們今年的進展，我們試圖對模塊製造商有所了解。

Okay. Let me try to clarify regarding the situation, the Q1 we faced. I think module makers, they're all opportunity takers. And because of the Chinese New Year is coming, so most of them, our customers, try to reduce inventory to reduce the risk. Because of the NAND pricing, there's still a lot of uncertainty, although the Xian Fab Samsung lockdown impact of Samsung's production output. But I think all the module makers, they are expecting NAND price decline continually. So they hesitate to really capture very large volume of NAND, so they don't need a more controller inventory. However, lately, we do see all the module customers from China, they are actually discussed by the new procurement program, which we see from the backlog from our Q2 and Q3. And these are really very, very actively across all our major customers in China and in Taiwan. So we see this as a very good momentum. And we check with the channel. It looks like the channel inventory now also very low in China, and the activity has become very -- is very actively. So this is a very positive move, and we see the backlog moving up very strong even with mature technologies, particularly in the legacy node. And this is helpful for us to increase our confidence China market will recover strongly from late Q1 to late Q2.

好的。讓我試著澄清一下我們面臨的第一季度的情況。我認為模塊製造商，他們都是機會吸收者。而且因為農曆新年快到了，所以大部分客戶，我們的客戶，都盡量減少庫存來降低風險。由於 NAND 定價的原因，仍然存在很多不確定性，儘管三星生產的西安晶圓廠鎖定影響了三星的產量。但我認為所有的模塊製造商，他們都在期待 NAND 價格持續下降。所以他們對真正捕獲非常大量的 NAND 猶豫不決，因此他們不需要更多的控制器庫存。然而，最近，我們確實看到了所有來自中國的模塊客戶，他們實際上是在新的採購計劃中討論的，我們從 Q2 和 Q3 的積壓中看到了這一點。這些對我們在中國大陸和台灣的所有主要客戶來說真的非常非常積極。所以我們認為這是一個非常好的勢頭。我們與頻道核對。看起來現在中國的渠道庫存也非常低，而且活動變得非常 - 非常活躍。所以這是一個非常積極的舉措，我們看到即使使用成熟的技術，積壓的工作量也非常強勁，特別是在遺留節點中。這有助於我們增強信心，中國市場將從第一季度末到第二季度末強勁復甦。

Our next question comes from the line of Karl Ackerman from Cowen and Company.

我們的下一個問題來自 Cowen and Company 的 Karl Ackerman。

Two questions, if I may. Riyadh, I was hoping you could help me bridge the outlook for March and the full year guide by discussing whether customers have signed or cemented volume orders for these PCIe 4 controllers. That gives you the confidence in a big snapback in the revenue beyond the March quarter. And as you address that question, is there a way to quantify the impact in March from a moderation or pushout of client SSDs given these supply chain disruptions impacting PC assembly?

兩個問題，如果可以的話。利雅得，我希望您能通過討論客戶是否已簽署或確定這些 PCIe 4 控制器的批量訂單來幫助我彌合 3 月和全年指南的前景。這讓您對 3 月季度之後的收入大幅回升充滿信心。當您解決這個問題時，考慮到這些供應鏈中斷影響 PC 組裝，有沒有辦法量化 3 月份客戶端 SSD 的節製或推出帶來的影響？

Karl, for your question relating to PCIe Gen4 purchase orders from our customer, I'll defer that question to Wallace who provide better insight into this.

Karl，對於您與我們客戶的 PCIe Gen4 採購訂單相關的問題，我將把這個問題交給 Wallace，他對此提供了更深入的了解。

I think our PCIe Gen4 program is that we have multiple PCIe Gen4 program with PC OEM from 5 different NAND makers and 4 different module makers simultaneously. So the ramp-up is based on their own internal program process. So there's a very intensive qualification and testing, also NAND procurement. The -- we do not see the schedule. For some of OEM, they are on track. For some, they are a little pushed out due to the delay from both our internal resource issue and then they make their own decision. So I cannot comment on the detail. But the backlog is very, very strong. We did not see any impact from the backlog. Frankly speaking, all the major new PCIe Gen4 are 12-nanometer technology node. And we just don't have enough wafer to support the demand to fill. If we have sufficient, I think we will revise guide immediately. For -- in addition is our UFS controller is 3.1 that uses TSMC 16-nanometer. We also have a severe shortage. Even TSMC increased in amount compared with the 2021, but they're not enough to meet our customer demand in 2022. So we'll continue to work with our customers, with TSMC together to gain additional wafer supply. But so -- but that's our baseline guidance, 20% to 30% growth based on current wafer allocated to us.

我認為我們的 PCIe Gen4 計劃是我們同時擁有來自 5 個不同 NAND 製造商和 4 個不同模塊製造商的 PC OEM 的多個 PCIe Gen4 計劃。所以加速是基於他們自己的內部程序過程。所以有一個非常密集的資格和測試，還有 NAND 採購。 - 我們沒有看到時間表。對於一些原始設備製造商來說，他們正在走上正軌。對於一些人來說，由於我們內部資源問題的延遲，他們有點被推出，然後他們自己做出決定。所以我不能對細節發表評論。但是積壓的工作非常非常強大。我們沒有看到積壓的任何影響。坦率地說，所有主要的新 PCIe Gen4 都是 12 納米技術節點。而且我們只是沒有足夠的晶圓來支持滿足需求。如果我們有足夠的，我想我們會立即修改指南。另外，我們的 UFS 控制器是使用 TSMC 16 納米的 3.1。我們也有嚴重的短缺。即使台積電與2021年相比數量有所增加，但不足以滿足我們2022年的客戶需求。因此，我們將繼續與客戶合作，與台積電一起獲得額外的晶圓供應。但是如此——但這是我們的基準指導，基於分配給我們的當前晶圓，增長 20% 到 30%。

That's very helpful. I appreciate that. For my follow-up, I did want to touch on your PCIe 5 enterprise controllers. You indicated that you are moving into production this year. But could you also discuss the design engagements you have on enterprise controllers broadly, both for PCIe 5 as well as PCIe 4 products that you have available today? And I guess as you address that question, is the growth of enterprise controllers a big driver, a small driver? What sort of driver to your full year outlook?

這很有幫助。我很感激。對於我的後續行動，我確實想談談你們的 PCIe 5 企業控制器。您表示您將在今年投入生產。但是，您能否廣泛討論您在企業控制器上的設計約定，包括您目前可用的 PCIe 5 和 PCIe 4 產品？我想當你回答這個問題時，企業控制器的增長是一個大驅動還是一個小驅動？您全年展望的驅動因素是什麼？

I think probably I did not speak clearly. We are going to sampling our PCIe Gen5 enterprise controller in the second half of this year. It will be production in second half of next year 2023. So the PCIe Gen5 flagship enterprise controller, we believe that will be uniquely positioned for very high-end, high-performance driver for enterprise customers, especially a hyperscale customer and a design for high-end enterprise server as well as data center providers. And we believe this product will win quite a lot of major design. We are in -- frequently discuss with the potential major customers. Currently, this year, we are ramping our SATA enterprise controller with a high volume, and our PCIe Gen4 controller, who is not a leading controller, but we also win some incremental customers. And we're going to ramp up in the second half of this year.

我想可能我沒有說清楚。我們將在今年下半年對我們的 PCIe Gen5 企業控制器進行採樣。將於明年下半年量產 2023 年。所以 PCIe Gen5 旗艦企業級控制器，我們相信它將為企業客戶，特別是超大規模客戶和高- 端企業服務器以及數據中心提供商。我們相信這款產品將贏得相當多的主要設計。我們在——經常與潛在的主要客戶討論。目前，今年我們正在大批量升級我們的SATA企業控制器，以及我們的PCIe Gen4控制器，雖然不是領先的控制器，但我們也贏得了一些增量客戶。我們將在今年下半年加大力度。

Our next question comes from the line of Suji Desilva from ROTH Capital.

我們的下一個問題來自 ROTH Capital 的 Suji Desilva。

Wallace, congrats on a strong year there. Looking ahead to calendar '22, it sounds like you're kind of setting it up the same way at the beginning of calendar '21, the guide and then the potential for upside with wafer allocation. How does the beginning of '22 feels different perhaps from the setup in '21, where you did upside the numbers just in terms of supply chain and capacity? Just be curious another differences.

華萊士，祝賀那裡有一個強勁的一年。展望 '22 日曆，聽起來您在 '21 日曆開始時採用相同的方式進行設置，指南以及晶圓分配的上行潛力。 '22 年初的感覺可能與 21 年的設置有何不同，您在供應鍊和產能方面確實增加了數字？只是好奇另一個差異。

I think that as we mentioned from the early 2021, we start to what TSMC for 2022 wafer supply. And we understand 2022 wafer supply, in particular, technology node that are more severe than 2021. So we -- I think TSMC recognized the importance of our position as a technology provider for major customer in certain market sector, so we do get an incremental wafer, especially in 16- and 12-nanometer technology node. We -- this year, the difference -- major difference is we have much broader OEM-based customers and much stronger market-leading position from both clients with the -- and eMMC and UFS controller because we have a multiple UFS controller will go production this year. Now we do face the -- even the wafer allocation we got, we can only grow as our guidance, 20% to 30%. However, this opportunity, which is we set a model like last year, our major customer will also helping us to asking additional wafer supply from TSMC. So if there's any customer cancellation or any opportunity, I think we might be able to get an incremental wafer in the second half of this year. So I think that we just keep a focus on what we are doing and try to maximize the wafer we're using for product mix. As I mentioned, 28-nanometer, we are a little comfortable. We could do a better wafer allocation in 20-nanometer to gain incremental sales revenue even without the additional allocation in advanced technology nodes.

我認為，正如我們從 2021 年初提到的，我們開始向台積電提供 2022 年的晶圓供應。我們了解 2022 年的晶圓供應，特別是比 2021 年更嚴峻的技術節點。所以我們——我認為台積電認識到我們作為特定市場領域主要客戶的技術供應商地位的重要性，所以我們確實獲得了增量晶圓，尤其是 16 和 12 納米技術節點。我們 - 今年的區別 - 主要區別在於我們擁有更廣泛的基於 OEM 的客戶，以及來自這兩個客戶的更強大的市場領先地位 - 以及 eMMC 和 UFS 控制器，因為我們有一個多 UFS 控制器將投入生產今年。現在我們確實面臨——即使是我們得到的晶圓分配，我們也只能按照我們的指導增長 20% 到 30%。然而，這個機會，這是我們去年樹立的榜樣，我們的主要客戶也將幫助我們向台積電要求額外的晶圓供應。因此，如果有任何客戶取消或任何機會，我認為我們可能能夠在今年下半年獲得增量晶圓。所以我認為我們只是專注於我們正在做的事情，並嘗試最大化我們用於產品組合的晶圓。正如我提到的，28 納米，我們有點舒服。即使沒有先進技術節點的額外分配，我們也可以在 20 納米上進行更好的晶圓分配，以增加銷售收入。

It's helpful. Thank you for that contrast versus 12 months ago. And then I think your next growth opportunity is really this high-end enterprise SSD controller or just enterprise SSD controllers in general. Can you talk about how, if any way, the competitive landscape there is different from the SSD controller business where you've been so strong and gained 10% share this year? I want to understand the competitive dynamics, how many subtle differences that we should note.

這很有幫助。感謝您與 12 個月前的對比。然後我認為您的下一個增長機會實際上是這種高端企業 SSD 控制器，或者只是一般的企業 SSD 控制器。您能否談談那裡的競爭格局與您今年如此強大並獲得 10% 份額的 SSD 控制器業務有何不同？我想了解競爭動態，我們應該注意多少細微的差異。

Yes. As you know well, we spent investment for enterprise controller for almost 4 years right now. We do gain tremendous lessons. We also gain technology and experience from previous 2 generations. Now I think that we found the, architecture-wise, our second-generation enterprise SSD controller steers behind the leading -- the leader in the market. However, the PCIe Gen5 enterprise controller is our third generation. We really learn enough lessons how to really -- to create a really enterprise-type controller architecture to meet the customer demand and expectations, particularly in latency and also the rewrite combination performance and all the key features and custom adds we all deliver into the silicon. And in addition, we also spent great effort to do the modeling for the computer architecture in SSD and also do the performance-tuning algorithms with dedicated firmware teams. Now we believe our firmware technology and enterprise SSD will be similar or same level with the leader in the market today. And that's why we have a pretty good confidence when we launch PCIe Gen5 SSD controller, we should have a pretty decent position in the market.

是的。如您所知，我們現在在企業控制器上花費了將近 4 年的時間。我們確實獲得了巨大的教訓。我們還從前 2 代中獲得技術和經驗。現在我認為我們發現，在架構方面，我們的第二代企業級 SSD 控制器引領市場領先地位。但是，PCIe Gen5 企業控制器是我們的第三代。我們真的學到了足夠多的經驗教訓如何真正——創建一個真正的企業型控制器架構來滿足客戶的需求和期望，特別是在延遲和重寫組合性能以及我們都提供到矽片中的所有關鍵特性和自定義添加方面.此外，我們還花大力氣為SSD中的計算機架構進行建模，並與專門的固件團隊一起進行性能調整算法。現在我們相信我們的固件技術和企業級 SSD 將與當今市場的領導者相近或處於同一水平。這就是為什麼我們在推出 PCIe Gen5 SSD 控制器時非常有信心，我們應該在市場上擁有相當不錯的地位。

Your next question comes from the line of Anthony Stoss from Craig-Hallum.

您的下一個問題來自 Craig-Hallum 的 Anthony Stoss。

I also wanted to follow up a little bit on the enterprise controller side, Wallace. Ahead of shipping to samples in the second half of this calendar year, you are exuding a ton of confidence entering that market just like you did with the PC OEM side. Is it just based on conversations since you haven't sampled solutions yet? And then also maybe 2 quickies for Riyadh, just updating kind of the order book size. And then also -- and maybe for you, Wallace as well. The Q1 limitation that you're getting now from TSM, when did you learn of this change? Is it something that you've known for a while? Or is it more recent?

我還想在企業控制器方面跟進一點，華萊士。在本日曆年下半年交付樣品之前，您對進入該市場充滿信心，就像您在 PC OEM 方面所做的那樣。由於您尚未對解決方案進行抽樣，因此是否僅基於對話？然後也可能是利雅得的 2 個快速操作，只是更新了訂單簿的大小。然後還有——也許對你來說，華萊士也是如此。你現在從 TSM 得到的 Q1 限制，你是什麼時候知道這個變化的？這是你已經知道一段時間的事情嗎？還是最近的？

I think you have probably 2 or 3 different questions. Let's just try the enterprise side. The enterprise, I think we do start to -- as we said, we do start to have a volume shipment for SATA enterprise controller this year. and our PCIe Gen4 controller is incremental sales. Although we understand that's not the leading controller today, but we are able to secure a few customers to sell the PCIe Gen4 as a vehicle to introduce our PCIe Gen5 enterprise controller, which we'll be sampling in the second half of this year and production in second half of next year.

我認為您可能有 2 或 3 個不同的問題。讓我們嘗試企業方面。企業，我認為我們確實開始——正如我們所說，今年我們確實開始批量出貨 SATA 企業控制器。我們的 PCIe Gen4 控制器是增量銷售。雖然我們知道這不是當今領先的控制器，但我們能夠確保一些客戶銷售 PCIe Gen4 作為介紹我們的 PCIe Gen5 企業級控制器的工具，我們將在今年下半年提供樣品並量產明年下半年。

Regarding the wafer allocation and discussion with the primary foundry maker, I cannot discuss details. But I think the TSMC, they definitely look based on the market need and also to avoid the short side and long side and balance the supply, right? So automotive is probably most critical sector. There's several other market sectors to avoid breakdown. So they look based on the market, surveying the feedback based on end customers' need and to do the allocation. I think we do have a very, very strong design win, specially PCIe Gen4. We believe our program will occupy probably 50% of all PCIe Gen4 from PC OEM. So that's significant. And definitely TSMC would have to consider because our shortage may cause a certain problem for the major supply chain for the node shipment. In addition, I think same thing for smartphone, all the UFS for major smartphone customers, and so this is very, very important for the foundry maker. I believe there are some discussions going on. We cannot comment on the detail. Hopefully, we can get an incremental wafer supply on the second half of this year.

關於晶圓分配和與主要代工廠商的討論，我無法討論細節。但是我覺得台積電，他們肯定是看市場需要，也避免做空做多，平衡供給，對吧？所以汽車可能是最關鍵的部門。還有其他幾個市場部門可以避免崩潰。所以他們立足於市場，根據最終客戶的需求調查反饋並進行分配。我認為我們確實有一個非常非常強大的設計勝利，特別是 PCIe Gen4。我們相信我們的程序可能會佔據 PC OEM 的所有 PCIe Gen4 的 50%。所以這很重要。而且台積電肯定要考慮，因為我們的短缺可能會給節點出貨的主要供應鏈帶來一定的問題。此外，我認為智能手機也是如此，主要智能手機客戶的所有 UFS，所以這對代工製造商來說非常非常重要。我相信正在進行一些討論。我們無法對細節發表評論。希望我們能在今年下半年獲得增加的晶圓供應。

Tony, I'll now try to address your other question, your third question relating to our -- the sizing of our order book. Our order book has continued to grow. Wallace had briefly touched upon that in his comments a little while ago. So our order books continue to grow. And one way to look at this is to look at our order book versus our actual sales. This ratio last year versus today has remained just as broad -- the ratio remains similar to what it was a year ago. So we -- our order book -- the strength of our order book has remained quite strong and quite sizable. But bear in mind, when we look at our -- when we talk about our order book, we're also talking about our adjusted order book where we're discounting the orders from our module makers that are more opportunistic with more limited visibility and focusing more on the higher quality stuff. But even with the higher quality visibility, it still remains very significant to what we're able to deliver this year comparable to what it was a year ago.

托尼，我現在將嘗試解決您的另一個問題，您的第三個問題與我們的訂單簿的大小有關。我們的訂單繼續增長。華萊士不久前在他的評論中簡要提到了這一點。因此，我們的訂單繼續增長。看待這一點的一種方法是查看我們的訂單與我們的實際銷售額。去年與今天的這一比率仍然很寬泛——該比率與一年前相似。所以我們——我們的訂單——我們的訂單的實力仍然非常強大並且相當可觀。但是請記住，當我們查看我們的 - 當我們談論我們的訂單時，我們也在談論我們調整後的訂單，我們正在對來自我們的模塊製造商的訂單進行折扣，這些製造商的機會主義更加有限，知名度和更多地關注更高質量的東西。但即使具有更高質量的可見性，與一年前相比，它對於我們今年能夠交付的內容仍然非常重要。

Our next question comes from Donnie Teng from Nomura.

我們的下一個問題來自野村的 Donnie Teng。

CEO and CFO, congrats on a very strong 2021 results. Two questions. So first one is, I'm interested in the game console business opportunity for this year, if I heard correctly. So one, could you kindly elaborate more on this opportunity? Is this for OEM or aftermarket? And also, are you replacing the existing suppliers? Or it's like you are the additional suppliers to this game console opportunity?

首席執行官兼首席財務官，祝賀 2021 年取得非常強勁的業績。兩個問題。所以第一個是，如果我沒聽錯的話，我對今年的遊戲機商機很感興趣。那麼，您能否詳細說明一下這個機會？這是 OEM 還是售後市場？此外，您是否正在更換現有的供應商？或者就像您是這個遊戲機機會的額外供應商？

So as I mentioned, this year is no -- the new generation, it will be 2023 launch. This year is a refresh. So we are not in the refresh cycle. Game console customers want to -- player want to maintain the same solution continually. I think we will go through 2 NAND makers to win the game console socket next year. I cannot comment whether we replace existing player or additional controller maker.

所以正如我所提到的，今年不是——新一代，它將是 2023 年推出。今年是一個更新。所以我們不在刷新周期中。遊戲機客戶希望——玩家希望持續保持相同的解決方案。我認為我們將通過 2 家 NAND 製造商來贏得明年的遊戲機插槽。我無法評論我們是否更換現有播放器或額外的控制器製造商。

Got it. Is it an OEM business or aftermarket business?

知道了。它是 OEM 業務還是售後市場業務？

OEM. OEM business.

OEM。代工業務。

And my second question is regarding to the UFS. So I think so far, we have a very powerful 2754-UFS 3.1 controller, right? I'm just curious, do we have any new generation or new upgrade for this IC maybe beyond second half this year with our leading U.S. customer? And also, considering UFS has been also replacing eMMC controller quickly this year, right? So just curious, regarding to your full year sales growth guidance, 20% to 30%, how would you think about the growth momentum between SSD controllers and the UFS controllers?

我的第二個問題是關於 UFS。所以我認為到目前為止，我們有一個非常強大的 2754-UFS 3.1 控制器，對吧？我只是好奇，今年下半年之後，我們是否會與我們的主要美國客戶一起為這款 IC 提供任何新一代或新升級？而且，考慮到今年 UFS 也在迅速更換 eMMC 控制器，對吧？所以很好奇，關於你們全年銷售增長指導，20% 到 30%，你如何看待 SSD 控制器和 UFS 控制器之間的增長勢頭？

Okay. Let me just -- I probably cannot probably to give you the whole product road map. But I should tell you, our UFS is going to have 2 more new product coming for this -- for the second half of this year. One is the also 3.1, the other is 4.0. The 3.1 is really is to support the new generation of NAND. Because a new generation of NAND, the DDR go to 2400 or DDR over 3000. So you don't need that many channels for NAND. So in order to be more cost-effective and also high performance, especially in (inaudible), we have a new architecture design for this new controller. And cost will be cheaper than [2754]. Performance could be even better. And because -- more suitable for the 176 layer or beyond, especially above 200-layer TLC as well as QLC NAND. And for UFS 4.0 is redesigned for a very high end, and we want to be ahead of even some NAND makers so we can provide the value-add to the NAND maker customers. Regarding the UFS sale revenue, I cannot comment for that because I just cannot -- I can just tell you the demand is much more than I can support. So even our customers try very hard to consign additional wafer. Still not enough to support the demand.

好的。讓我 - 我可能無法為您提供整個產品路線圖。但我應該告訴你，我們的 UFS 將為此推出另外 2 款新產品——今年下半年。一個也是3.1，另一個是4.0。 3.1真的是支持新一代的NAND。因為新一代的 NAND，DDR 達到 2400 或 DDR 超過 3000。所以 NAND 不需要那麼多通道。因此，為了更具成本效益和高性能，尤其是在（聽不清），我們為這款新控制器提供了新的架構設計。而且成本會比[2754]便宜。性能可能會更好。而且因為——更適合176層以上，尤其是200層以上的TLC以及QLC NAND。 UFS 4.0 針對非常高端的產品進行了重新設計，我們甚至希望領先於一些 NAND 製造商，這樣我們就可以為 NAND 製造商的客戶提供增值服務。關於 UFS 的銷售收入，我無法對此發表評論，因為我不能——我只能告訴你，需求遠遠超出我的支持範圍。因此，即使是我們的客戶也非常努力地委託額外的晶圓。仍然不足以支撐需求。

Don, let me also add, this year, our growth is not only quite strong, but it's also very balanced. We have very strong growth from our client SSD controllers. We also have very strong growth from our eMMC+UFS controls. And when you look into that one layer below, growth is not coming just because of 1 of the 2 legs of UFS + eMMC, but rather growth is coming from both legs of eMMC. So strong growth from our eMMC controllers as well as strong growth from our UFS controllers, and we believe this will carry over into next year.

唐，我還要補充一點，今年，我們的增長不僅非常強勁，而且非常平衡。我們的客戶 SSD 控制器增長非常強勁。我們的 eMMC+UFS 控制也有非常強勁的增長。當您查看下面的一層時，增長不僅僅是因為 UFS + eMMC 兩條腿中的一條，而是來自 eMMC 的兩條腿。我們的 eMMC 控制器的強勁增長以及我們的 UFS 控制器的強勁增長，我們相信這將延續到明年。

Thank you. There are no further questions. I'll now turn the call back to CEO for closing remarks.

謝謝你。沒有進一步的問題。我現在將電話轉回給 CEO 以結束髮言。

Thank you, everyone, for joining us today and for your continuing interest in Silicon Motion. We will be attending several virtual investor conferences over the next few months. The schedule of these events will be posted on the Investor Relationship section of our corporate website. Thank you, everyone, for joining tonight. Goodbye for now.

感謝大家今天加入我們，感謝您對 Silicon Motion 的持續關注。在接下來的幾個月裡，我們將參加幾次虛擬投資者會議。這些活動的時間表將發佈在我們公司網站的投資者關係部分。謝謝大家今晚的加入。暫時告別。

Thank you. That does conclude our conference for today. Thank you for participating. You may all disconnect.

謝謝你。這確實結束了我們今天的會議。感謝您的參與。你們都可以斷開連接。