慧榮科技 (SIMO) 2020 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to Silicon Motion Technology Corp. Q4 2020 Earnings Conference Call. (Operator Instructions)

女士們、先生們，感謝大家的支持，歡迎參加慧榮科技 2020 年第四季財報電話會議。 （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 Securities Exchange Act of 1934 as amended. Such forward-looking statements include, without limitation, statements regarding trends in the semiconductor industry and for the results of operations, financial conditions and business prospects.

本次電話會議包含 1933 年《證券法》第 27A 條和經修訂的 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產業趨勢以及營運結果、財務狀況和業務前景的陳述。

Although such statements are based on our own information and information from the sources we believe to be reliable, you should not place undue reliance on them. 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.

儘管此類聲明基於我們自己的資訊以及我們認為可靠的來源的信息，但您不應過度依賴它們。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有重大差異。

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 the technology and consumer demand of multimedia consumer electronics, the state of and change in our relationship with our major customers and change in political, economic, legal and social conditions in Taiwan.

潛在的風險和不確定性包括但不限於半導體產業持續的競爭壓力以及這種壓力對價格的影響、多媒體消費電子產品的技術和消費者需求的不可預測的變化、我們與客戶關係的狀況和變化。

For additional discussion of these risks and uncertainties and other factors, please see the documents we file from the time to time with the Securities and Exchange Commission. We assume no obligation 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，請參閱我們不時向美國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。

I would now like to hand the conference over to your first speaker today, Mr. Chris Chaney, Director of Investor Relations and strategy. Thank you. Please go ahead, sir.

現在我想將會議交給今天的第一位發言者，投資者關係和策略總監 Chris Chaney 先生。謝謝。請繼續，先生。

Thank you, A.J. Good morning, everyone, and welcome to Silicon Motion's Fourth Quarter 2020 Financial Results Conference Call and Webcast. As A.J. mentioned, my name is Chris Chaney, Director of Investor Relations. And joining me today on this call are Wallace Kou, our President and CEO; and Riyadh Lai, our Chief Financial Officer.

謝謝你，A.J.大家早安，歡迎參加慧榮科技 2020 年第四季財務業績電話會議和網路廣播。正如 A.J.提到的，我的名字是克里斯·錢尼，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執行長 Wallace Kou；以及我們的財務長 Riyadh Lai。

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

在我發表評論後，華萊士將對我們的關鍵業務發展進行回顧，然後利雅德將討論我們第四季度的業績和前景。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 was just read at the beginning 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 refer to our press release, which was filed on our 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，我們剛剛在本次電話會議開始時閱讀了該政策。有關投資我們的證券所涉及風險的全面概述，請參閱我們向美國證券交易委員會提交的文件。有關我們財務業績的更多詳細信息，請參閱我們的新聞稿，該新聞稿在昨天收盤後以 6-K 表格形式提交。

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

該網絡廣播將在我們網站的投資者關係部分限時重播。為了增強投資者對我們當前經濟表現的了解，我們將在本次電話會議上討論非公認會計準則資訊。我們在內部使用非公認會計準則財務指標來評估和管理我們的營運。因此，我們選擇提供此信息，以便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。

For more consistent year-over-year comparison for this quarter and our upcoming fourth quarter, we are internally measuring our performance-based on non-GAAP less FCI, which was divested in May 2019. The reconciliation of the 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.

為了使本季度和即將到來的第四季度的同比比較更加一致，我們根據非 GAAP 減去 FCI（已於 2019 年 5 月剝離）對我們的業績進行內部衡量。在我們昨天發布的財報中找到。我們要求您結合本次電話會議進行審查。

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

現在，我想把電話轉給華萊士。

Thank you, Chris. Hello, everyone, and thank you for joining us today. In the fourth quarter, we delivered $144 million in sales, about 4% more than the high end of our guidance range. Compared to the third quarter, revenue was up 14% sequentially.

謝謝你，克里斯。大家好，感謝您今天加入我們。第四季度，我們實現了 1.44 億美元的銷售額，比指導範圍的上限高出約 4%。與第三季相比，營收季增14%。

Earnings per ADS for the fourth quarter were $0.86, up from $0.76 in the third quarter. For the full year, revenue was $540 million, up 20% compared to last year. Earnings per ADS was $3.24, up 25% from a year ago.

第四季每股美國存託憑證收益為 0.86 美元，高於第三季的 0.76 美元。全年營收為 5.4 億美元，比去年成長 20%。每份 ADS 收益為 3.24 美元，比去年同期成長 25%。

Our fourth quarter results were stronger than expected. The consumer procurement continues to be robust. Sales of our eMMC+UFS controller for smartphones and IoT devices were especially strong. And our SD controller continued to benefit from strong PC demand. Sales of our SSD solutions were, however, seasonally soft.

我們第四季的業績優於預期。消費者採購持續旺盛。用於智慧型手機和物聯網設備的 eMMC+UFS 控制器的銷售尤其強勁。我們的 SD 控制器繼續受益於強勁的 PC 需求。然而，我們的 SSD 解決方案的銷售季節性疲軟。

Based on purchase orders received from our customers, we are expecting the strength of our fourth quarter to strengthen further through the first quarter and stay robust through the rest of 2021. Purchase order received for the first quarter already exceeds our first quarter sales guidance. And purchase order for the full year already meaningfully exceed our full year guidance.

根據從客戶收到的採購訂單，我們預計第四季度的實力將在第一季進一步加強，並在2021 年剩餘時間保持強勁。指導。全年的採購訂單已經大大超出了我們的全年指導。

Our ability to meet customer order is, however, limited by our product supply. Our first quarter sales are limited by a variability of product inventory. And our full year sales growth is limited by the current foundry supply shortage that is also affecting much of the overall semiconductor industry today.

然而，我們滿足客戶訂單的能力受到我們的產品供應的限制。我們第一季的銷售受到產品庫存變化的限制。我們的全年銷售成長受到當前代工供應短缺的限制，這也影響了當今整個半導體產業的大部分。

Demand of our SSD and eMMC+UFS controller remain very strong. We continue to see robust sales of PC driven, especially by the need of working from home and online learning. Additionally, OEM adoption of SSD in PC and other devices continued to grow as more low-cost NAND for SSD facilitates the replacement of HDD.

我們的 SSD 和 eMMC+UFS 控制器的需求仍然非常強勁。我們繼續看到 PC 銷售的強勁成長，特別是由於在家工作和線上學習的需求。此外，隨著更多低成本 NAND 用於 SSD 促進 HDD 的替代，OEM 在 PC 和其他裝置中採用 SSD 的情況持續成長。

And furthermore, we expect our SSD controller market share gains to accelerate based on our pipeline of design wins, both with NAND flash makers and module makers for the OEM market. We are expecting stronger SD controller sales growth this year compared to last year.

此外，我們預計，基於我們與 NAND 快閃記憶體製造商和 OEM 市場模組製造商的設計合作，我們的 SSD 控制器市場份額將加速成長。我們預計今年 SD 控制器的銷售成長將比去年更加強勁。

We continue to see OEM smartphone build activity improve. More meaningfully, the transition from the legacy eMMC mobile embedded storage to newer UFS technology continued to increase rapidly. As OEM pair UFS with new generation of application processors and higher stack cameras.

我們繼續看到 OEM 智慧型手機製造活動有所改善。更有意義的是，從傳統的 eMMC 行動嵌入式儲存到更新的 UFS 技術的過渡持續快速成長。作為 OEM，將 UFS 與新一代應用處理器和更高堆疊的相機配對。

Additionally, sales of eMMC controller to module makers who are building cost-effective storage solution for low-cost smartphones, Chromebooks, smart speakers and other IoT devices remain strong. As previously discussed, NAND flash makers have been turning over legacy eMMC business to module makers, and we benefit from this.

此外，對於為低成本智慧型手機、Chromebook、智慧揚聲器和其他物聯網設備建立經濟高效的儲存解決方案的模組製造商來說，eMMC 控制器的銷售仍然強勁。如前所述，NAND 快閃記憶體製造商已將傳統 eMMC 業務移交給模組製造商，我們從中受益。

We are also expecting stronger eMMC+UFS controller sales growth this year compared to last year. We believe our SSD and eMMC+UFS controller market share gains will accelerate because of our growing design win pipeline. Currently, foundry capacity shortage is also affecting NAND flash makers with captive controller programs as well as other merchant controller suppliers. Because of the shortage issue, we are seeing NAND flash makers rationalize internal controller program and seek to outsource more.

我們也預計今年 eMMC+UFS 控制器的銷售成長將比去年更強勁。我們相信，由於我們不斷成長的設計贏得管道，我們的 SSD 和 eMMC+UFS 控制器市場份額將會加速成長。目前，代工產能短缺也影響著擁有專屬控制器計畫的 NAND 快閃記憶體製造商以及其他商用控制器供應商。由於短缺問題，我們看到 NAND 快閃記憶體製造商正在合理化內部控制器程式並尋求外包更多。

We are also seeing merchant controller competitors who are all meaningfully smaller than us, face more adverse boundary supply shortage issues, which has led several of bigger customers to redirect business to us.

我們也看到，商家控制競爭對手的規模都比我們小得多，面臨更不利的邊界供應短缺問題，這導致一些較大的客戶將業務轉向我們。

Let me now share with you key objectives from our 3-year strategic plan. With the growing strength of our business and better visibility from our expanding OEM program, we are increasingly confident that we can achieve our strategic plan of delivering USD 1 billion of sales by 2023, with a stable 50% gross margin to represent target operation margin and EPS growing meaningfully faster than revenue. Our orders booked to date, unconstrained by foundry capacity limitation, will already take us to considerable weight beyond our full year guidance towards this $1 billion sales objective.

現在讓我與大家分享我們三年策略計畫的主要目標。隨著我們業務實力的不斷增強以及我們不斷擴大的OEM 計劃帶來的更好的知名度，我們越來越有信心能夠實現到2023 年實現10 億美元銷售額的戰略計劃，並以穩定的50%毛利率代表目標營運利潤率和每股盈餘的成長明顯快於收入的成長。迄今為止，我們預訂的訂單不受代工廠產能限制的影響，已經超出了我們實現 10 億美元銷售目標的全年指引。

With sales growth primarily from our clients need and eMMC+UFS controllers, plus additional contribution from our Ferri industrial SSD. With our new PCIe Gen5 enterprise SSD controller sampling in the second half of next year, we are not expecting our enterprise SSD controller to be a material contributor to our $1 billion sales objective. We are planning a material enterprise SSD controller sales contribution only after 2023.

銷售成長主要來自我們的客戶需求和 eMMC+UFS 控制器，以及我們 Ferri 工業 SSD 的額外貢獻。隨著我們新的 PCIe Gen5 企業級 SSD 控制器將於明年下半年提供樣品，我們預計我們的企業級 SSD 控制器不會對我們 10 億美元的銷售目標做出重大貢獻。我們計劃僅在 2023 年之後對企業級 SSD 控制器的銷售貢獻做出實質貢獻。

In the 500 PLUS gaming units a year client device market, primarily SSD supply to PC, consumer electronics and industrial OEM as well as into aftermarket channels, SSD adoption has increased rapidly and will continue to increase rapidly as HDD are further replaced.

在每年500 PLUS 遊戲機的客戶端設備市場中，主要是向PC、消費性電子產品和工業OEM 以及售後市場通路供應SSD，SSD 的採用率已迅速增加，隨著HDD 的進一步取代，SSD 的採用率將繼續快速增加。

With our design win pipeline, we expect a roughly double our SSD controller sales in 3 years from our combination of SSD adoption in client devices increasing from 60% to 65% last year to 80% to 90% by 2023. And our overall market share increasing to about 40%. Our market share in smaller channel segment is already high, while our share in the larger OEM sector segment is low.

憑藉我們的設計贏得管道，我們預計客戶端設備中 SSD 的採用率將在 3 年內翻一番，從去年的 60% 到 65% 增加到 2023 年的 80% 到 90%。到40%左右。我們在較小通路領域的市佔率已經很高，而我們在較大 OEM 領域的份額較低。

We expect to maintain our high share of the channel market and drive faster growth with OEM, the segment where we have a large and growing pipeline of design wins and rapidly gain market share in the OEM segment. We expect to deliver our SD controller growth objective just based on sales to the existing NAND flash and module maker customers.

我們希望保持通路市場的高份額，並透過 OEM 推動更快的成長，我們在 OEM 領域擁有大量且不斷成長的設計勝利管道，並迅速獲得 OEM 領域的市場份額。我們預計僅根據現有 NAND 快閃記憶體和模組製造商客戶的銷售情況即可實現 SD 控制器成長目標。

Our eMMC+UFS controllers, we are expecting our sales to more than double by 2023, driven by a combination of our market share reverting to about 1/4 from meeting last year, as well as UFS adoption in smartphones and other devices increasing from 45% to 50% last year to at least 80% in 3 years' time.

我們的eMMC+UFS 控制器，預計到2023 年我們的銷售額將增加一倍以上，這得益於我們的市場份額從去年的水平恢復到約1/4，以及智慧型手機和其他設備中UFS 的採用率從45 增加到去年的 % 到 50%，三年後至少達到 80%。

Again, we are also expecting to deliver our eMMC+UFS controller growth objectives just based on sales to existing NAND flash and module maker customers. Separately, we are also expecting meaningful sales growth from our FerriSSD, a part of our SSD solutions.

同樣，我們也期望僅基於對現有 NAND 快閃記憶體和模組製造商客戶的銷售來實現我們的 eMMC+UFS 控制器成長目標。另外，我們也預期 FerriSSD（SSD 解決方案的一部分）的銷售量將會顯著成長。

In past years, most of FerriSSD was sold into diversified set of industrial, commercial equipment and data networking applications. More recently, we also started selling to automotive component supplier, building infotainment system and dashboards for Japanese and German car brands and expect meaningful growth over the next 3 years from sale to these customers.

在過去的幾年中，大部分 FerriSSD 被銷售到多元化的工業、商業設備和數據網路應用。最近，我們也開始向汽車零件供應商銷售，為日本和德國汽車品牌建立資訊娛樂系統和儀表板，並預計在未來 3 年內向這些客戶的銷售將實現有意義的成長。

To summarize, we have high confidence in delivering to our strategic plan, not only because of grown NAND flash and module maker customer base. And the extensive pipeline of business engagement, but also because our order book, that is now limited by foundry supply availability, will already take us to a considerable way towards our $1 billion sales objective.

總而言之，我們對實現我們的策略計劃充滿信心，這不僅是因為 NAND 快閃記憶體和模組製造商客戶群的不斷增長。廣泛的業務合作管道，也因為我們的訂單現在受到代工供應可用性的限制，已經使我們在實現 10 億美元銷售目標方面取得了長足進步。

I would like to thank TSMC for their continued support, without which our ability to support our broad customer base and the extensive NAND flash ecosystem this year will be in jeopardy and our customer for their understanding of the extraordinary supply constraints that we are temporarily facing.

我要感謝台積電的持續支持，如果沒有他們的支持，我們今年支持廣泛客戶群和廣泛的 NAND 快閃生態系統的能力將處於危險之中，感謝我們的客戶對我們暫時面臨的異常供應限制的理解。

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，討論我們的財務表現和前景。

Thank you, Wallace, and hello, everyone. I will discuss additional details of our fourth quarter results and then provide our guidance. My comments today will focus primarily on our non-GAAP results less FCI 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，大家好。我將討論我們第四季度業績的更多細節，然後提供我們的指導。除非另有特別說明，我今天的評論將主要關注我們的非 GAAP 業績，而不是 FCI。我們的 GAAP 與非 GAAP 數據的調整包含在昨天發布的收益報告中。

In the fourth quarter, revenue was $144 million, 14% higher sequentially and 6% lower year-over-year. For the full year, revenue of $540 million was 20% higher than a year ago. In the fourth quarter, earnings per ADS were $0.86, 12% higher sequentially and 11% lower year-over-year. For the full year, earnings per ADS of $3.24 were 25% higher than a year ago.

第四季營收為 1.44 億美元，季增 14%，年減 6%。全年營收為 5.4 億美元，比去年同期成長 20%。第四季度，每份 ADS 收益為 0.86 美元，季增 12%，年減 11%。全年每 ADS 收益為 3.24 美元，比去年同期成長 25%。

Now for some details, starting with performance of our 3-key products. SSD controller sales increased 5% to 10% sequentially, in line with our sales plan. Full year sales were up 15% to 20%, meaningfully faster than client SSD controller market revenue growth. SSD controller sales remained 50% to 60% of total revenue, similar to the prior year. eMMC+UFS controller sales rebounded 65% to 70% sequentially, after a sharp decline in the prior quarter, as our large NAND customer worked down its inventory and started actively restocking.

現在介紹一些詳細信息，首先從我們的 3 個關鍵產品的性能開始。 SSD 控制器銷售量較上季成長 5% 至 10%，符合我們的銷售計畫。全年銷售額成長 15% 至 20%，明顯快於客戶端 SSD 控制器市場營收成長。 SSD控制器銷售額仍佔總營收的50%至60%，與前一年類似。隨著我們的大型 NAND 客戶減少庫存並開始積極補貨，eMMC+UFS 控制器銷售額在上一季大幅下降後，季減 65% 至 70%。

Full year sales grew 35% to 40%, sequentially faster -- substantially faster than market revenue growth. eMMC+UFS controller sales increased to 25% to 30% of total revenue from 20% to 25% in the prior year.

全年銷售額成長 35% 至 40%，環比成長速度更快，大大快於市場收入成長。 eMMC+UFS控制器銷售額佔總收入的比例從前一年的20%至25%增加到25%至30%。

SSD solutions sales were seasonally soft and declined 30% to 35%. Full year sales grew 35% to 40% with positive contributions from both Shannon and Ferri. SSD solution sales increased to 10% to 15% of total revenue from roughly 10% the prior year. Gross margin in Q4 increased slightly to 49.3% from 49.1% in the prior quarter.

SSD 解決方案銷售季節性疲軟，下降了 30% 至 35%。在 Shannon 和 Ferri 的積極貢獻下，全年銷售額成長了 35% 至 40%。 SSD 解決方案銷售額佔總收入的比例從前一年的約 10% 增至 10% 至 15%。第四季的毛利率從上一季的 49.1% 小幅上升至 49.3%。

For the full year, gross margin decreased to 49.2% from 50.1% in the prior year due to a higher mix of lower gross margin SSD solutions sales as well as a slight decrease in controller gross margin. Operating expenses in Q4 were $39.5 million, $6.6 million higher than the prior quarter, primarily due to higher R&D tape-out related expenses. Also, OpEx was roughly 4.5% higher because of NT dollar and renminbi foreign exchange appreciation.

全年毛利率從去年的 50.1% 下降至 49.2%，原因是毛利率較低的 SSD 解決方案銷售增加以及控制器毛利率略有下降。第四季的營運費用為 3,950 萬美元，比上一季增加 660 萬美元，主要是由於研發流片相關費用增加。此外，由於新台幣和人民幣匯率升值，營運支出增加了約 4.5%。

For the full year, operating expenses were $147.7 million, 14% higher than the prior year, primarily due to higher headcount and compensation-related expenses, but also due to higher R&D tape-outs. 60%, 65% of our operating expense is headcount related, and roughly half of the remainder is related to R&D tape-out, IP and other project-related expenses. Last year, over 80% of our R&D project expenses were for SSD controllers, and roughly 1/4 of this was for enterprise SSD controllers. For the full year, operating expenses were roughly 1.7% higher because of the NT dollar and renminbi foreign exchange appreciation.

全年營運費用為 1.477 億美元，比上年增長 14%，主要是由於員工人數和薪酬相關費用增加，但也由於研發流片增加。我們的營運費用中有 60%、65% 與員工人數相關，剩下的大約一半與研發流片、IP 和其他項目相關費用有關。去年，我們80%以上的研發項目費用用於SSD控制器，其中約1/4用於企業級SSD控制器。全年營業費用因新台幣及人民幣匯率升值而增加約1.7%。

Operating margin in Q4 was 21.9%, slightly lower when compared to 23% in the prior quarter due to higher operating expenses. Full year operating margin was 21.8%, up from 21.2% in the prior year. Our effective tax rate in Q4 was 7.5%, below our 15% to 20% tax rate guidance due to certain onetime benefits and timing differences. Stock-based compensation in our operating expenses, which we exclude from our non-GAAP results, was $8.7 million in Q4 within our $8.4 million to $9.4 million guidance range.

由於營運費用增加，第四季營運利潤率為 21.9%，略低於上一季的 23%。全年營業利益率為 21.8%，高於前一年的 21.2%。由於某些一次性福利和時間差異，我們第四季的有效稅率為 7.5%，低於 15% 至 20% 的稅率指引。第四季度，我們營運費用中基於股票的薪酬（我們將其排除在非 GAAP 業績之外）為 870 萬美元，在我們 840 萬美元至 940 萬美元的指導範圍內。

We had $369.2 million of cash, cash equivalents, restricted cash and short-term investments at the end of Q4 compared to $368.4 million at the end of the prior quarter. We paid $12.1 million in dividends to shareholders. The first quarterly installment of our $1.40 per ADS annual dividend that was announced last October.

截至第四季末，我們擁有 3.692 億美元的現金、現金等價物、限制性現金和短期投資，而上一季末為 3.684 億美元。我們向股東支付了 1210 萬美元的股息。去年 10 月宣布的第一季分期付款為每 ADS 1.40 美元的年度股息。

Let me update everyone about our Shannon product line, which has continued to underperform in terms of sales, profitability and cash flow. Shannon was an acquired asset. We are required to test for asset impairment at least annually. During our recent assessment, we determined that our asset was impaired and wrote off the remaining $17.5 million of Shannon goodwill on our balance sheet. Additionally, we wrote down $4.9 million of inventory, primarily NAND flash components to fair market value and Shannon SSDs for obsolescence.

讓我向大家介紹我們香農產品線的最新情況，該產品線在銷售額、盈利能力和現金流方面繼續表現不佳。香農是一項收購資產。我們需要至少每年進行一次資產減損測試。在我們最近的評估中，我們確定我們的資產已減值，並註銷了資產負債表上剩餘的 1,750 萬美元香農商譽。此外，我們還減記了 490 萬美元的庫存，其中主要是 NAND 快閃記憶體組件，以達到公平市場價值，並減記 Shannon SSD 以便過時。

Although sales of our Shannon data center SSDs grew last year, sales significantly underperformed internal plans. Gross profitability was also significantly lower, and excluding the inventory write down, our Shannon product line incurred an operating loss of about $5 million.

儘管去年香農資料中心 SSD 的銷量有所成長，但銷量明顯低於內部計畫。毛獲利能力也顯著降低，不包括庫存減記，我們的香農產品線產生了約 500 萬美元的營運虧損。

Sales of differentiated open channel SSDs to Alibaba were in line with expectations, but sales of standard NVMe SSDs to other data center customers were off considerably because of the soft demand environment in China for enterprise SSDs and brutal competition from the NAND flash makers. We continued to restructure our Shannon operating team, which included the departure of many senior managers last year and are working to restore this product line to growth and profitability.

差異化開放通路SSD向阿里巴巴的銷售符合預期，但由於中國企業級SSD需求疲軟以及來自NAND快閃記憶體製造商的殘酷競爭，向其他資料中心客戶的標準NVMe SSD銷售大幅下降。我們繼續重組香農營運團隊，其中包括去年許多高階主管的離職，並正在努力恢復該產品線的成長和獲利能力。

We expect Shannon sales in 2021 to contract meaningfully as our large customer worked down its elevated inventory of SSDs procured from us and other suppliers last year before restocking. And we focus on fewer but higher-margin sales. With lower levels of sales, we are also expecting our Shannon operating loss to widen further this year.

我們預計 2021 年 Shannon 的銷售額將大幅收縮，因為我們的大客戶在重新進貨之前減少了去年從我們和其他供應商購買的 SSD 的高庫存。我們專注於數量較少但利潤較高的銷售。由於銷售水準較低，我們也預期香農今年的營業虧損將進一步擴大。

Now let me turn to our first quarter and full year guidance and forward-looking business trends. For the first quarter, we expect revenue to increase 7% to 12% sequentially to approximately $154 million to $161 million. For full year 2021, we expect revenue to increase 20% to 30% to $650 million to $700 million.

現在讓我談談我們的第一季和全年指導以及前瞻性業務趨勢。我們預計第一季營收將季增 7% 至 12%，達到約 1.54 億至 1.61 億美元。對於 2021 年全年，我們預計營收將成長 20% 至 30%，達到 6.5 億至 7 億美元。

As Wallace had discussed, we already have purchase orders for significantly more than our revenue guidance range, but are limited by foundry capacity available to us. If more foundry capacity were made available to us, we could grow even faster. The guidance range that I had just provided is based on current uncertainties primarily relating to foundry capacity allocation.

正如華萊士所討論的，我們的採購訂單已經遠遠超出了我們的收入指導範圍，但受到我們可用的代工產能的限制。如果我們能夠獲得更多的代工產能，我們的成長速度將會更快。我剛剛提供的指導範圍是基於當前主要與代工產能分配相關的不確定性。

In the first quarter, we are expecting strong SSD and eMMC+UFS controller sales growth and more modest SSD solutions sales growth. For the full year, as Wallace had highlighted, we are expecting both our SSD controllers and eMMC+UFS controller sales to grow much faster than last year and our SSD solutions sales to be flat.

在第一季度，我們預期 SSD 和 eMMC+UFS 控制器銷售成長強勁，而 SSD 解決方案銷售成長較為溫和。對於全年，正如 Wallace 所強調的那樣，我們預計我們的 SSD 控制器和 eMMC+UFS 控制器的銷售額將比去年增長得更快，而我們的 SSD 解決方案的銷售額將持平。

First quarter gross margin should be in the range of 48% to 50%. For the full year, based on certain assumptions, we are expecting gross margin in the 47% to 49% range. Assumptions are substrate and packaging costs are increasing, and we expect the whole prices flat unless they are subject to contractual pricing arrangements in supply agreements. However, our gross margins could be higher if we're able to negotiate higher prices and separately successfully execute initiatives to reduce product cost. If we're able to increase our prices and lower our costs, our gross margin could be higher than guidance.

第一季毛利率應在48%至50%之間。就全年而言，基於某些假設，我們預計毛利率在 47% 至 49% 範圍內。假設基材和包裝成本正在增加，我們預期整體價格持平，除非它們受到供應協議中的合約定價安排的約束。然而，如果我們能夠協商更高的價格並單獨成功執行降低產品成本的舉措，我們的毛利率可能會更高。如果我們能夠提高價格並降低成本，我們的毛利率可能會高於指導值。

We expect first quarter operating margin to be in the range of 21% to 23%. For the full year, we expect operating margin in the 24% to 26% range. As many of you know, the NT dollar and renminbi had strengthened considerably, especially in the second half of last year. If exchange rates are maintained at year-end rates for the rest of the year, which we are assuming, we estimate the impact to our operating expenses compared to last year is approximately 2% to 2.5%.

我們預計第一季營業利潤率將在 21% 至 23% 之間。我們預計全年營業利益率為 24% 至 26%。大家都知道，新台幣和人民幣都大幅升值，尤其是去年下半年。如果匯率在今年餘下時間維持在年底匯率（我們假設），我們預計與去年相比，對我們營運支出的影響約為 2% 至 2.5%。

In the first quarter, we expect stock-based compensation in the range of $3.1 million to $3.3 million, amounts consistent with the seasonal timing of RSU grants in past years. For the full year, we expect stock-based compensation in the range of $14 million to $16 million, consistent with the prior year. We expect our effective tax rate for the year in the 15% to 20% range with tax rate in the first quarter in the lower half of the range.

我們預計第一季的股票薪資將在 310 萬美元至 330 萬美元之間，這筆金額與過去幾年 RSU 撥款的季節性時間一致。我們預計全年的股票薪酬將在 1,400 萬美元至 1,600 萬美元之間，與前一年一致。我們預計今年的有效稅率將在 15% 至 20% 的範圍內，第一季的稅率將在該範圍的下半部分。

On February 24, we will break ground for the construction of our Hsinchu office building. We spent $59 million in 2018 for the purchase of land. Construction is budgeted to cost $77 million with $7 million spent this year and $34 million spent next year. We expect to complete construction in 2024. Upon completion, we plan on a sale and leaseback of the building.

2月24日，我們新竹辦公大樓將破土動工。 2018 年，我們花了 5,900 萬美元購買土地。建設預算耗資 7,700 萬美元，其中今年支出 700 萬美元，明年支出 3,400 萬美元。我們預計於 2024 年竣工。

This concludes our prepared remarks, and now we'll open the call to your questions.

我們準備好的演講到此結束，現在我們將開始回答大家的問題。

(Operator Instructions) We have the first question from the line of Karl Ackerman from Cowen.

（操作員說明）我們收到來自 Cowen 的 Karl Ackerman 的第一個問題。

First question for me. I appreciate the full year outlook you provided. And in your prepared remarks, Wallace spoke about how competitors are facing challenges with supply, enabling you to bring some new customers on to your platform. And you also spoke about how some NAND OEMs are easing on their willingness to move to internal solutions.

我的第一個問題。我感謝您提供的全年展望。在您準備好的演講中，華萊士談到了競爭對手如何面臨供應挑戰，使您能夠為您的平台帶來一些新客戶。您還談到了一些 NAND OEM 如何放鬆轉向內部解決方案的意願。

So my question is, are these volumes ad hoc and opportunistic? Or what sort of volume commitments are you able to secure that would help support both your full year guide and view through 2023?

所以我的問題是，這些卷是臨時的還是機會主義的？或者您能夠獲得什麼樣的銷售承諾來幫助支持您的全年指南和 2023 年展望？

So as we stated, our current committed wafer supply from our foundry makers, we are -- can fulfill our full year guidance 20% to 30%. There's no question. If we have additional incremental wafer allocation for our foundry makers, our guidance will be higher.

因此，正如我們所說，我們目前從代工製造商承諾的晶圓供應，可以實現全年指導目標的 20% 至 30%。毫無疑問。如果我們為代工製造商提供額外的增量晶圓分配，我們的指導將會更高。

Okay. I appreciate that. I guess then relative to your SSD solution business, could you discuss how the shift in the consignment model will impact at least qualitatively your revenue and profitability in 2021 versus 2020? I guess the -- is the widened operating loss expectation coming only from enterprise SSD? That's my question.

好的。我很欣賞這一點。我想，相對於您的 SSD 解決方案業務，您能否討論一下寄售模式的轉變將如何至少在質量上影響您 2021 年與 2020 年的收入和盈利能力？我想－營業虧損預期的擴大是否僅來自企業級 SSD？這就是我的問題。

Yes. That's related to the operating loss and the consignment, that relates specifically to our Shannon data center SSD product line. So as we talked about during the call, our Shannon product line had under-delivered in terms of revenue growth, profitability and cash flow generation.

是的。這與營運損失和寄售有關，特別與我們的香農資料中心 SSD 產品線有關。因此，正如我們在電話會議中談到的那樣，我們的香農產品線在收入成長、獲利能力和現金流生成方面表現不佳。

And so we -- as part of our regular testing of our acquisition, the valuation of our acquisition, we have determined that the assets were impaired and so took a full write-down of the remaining goodwill.

因此，作為對收購的定期測試和收購估值的一部分，我們確定資產已受損，因此對剩餘商譽進行了全額減記。

So in terms of the profitability of our business, our gross margins have been below our corporate average by a significant amount because of the products that we're building, requiring the purchase of NAND. So as part of that -- or this issue, last year, we started for one specific customer, for Alibaba, moving to a consignment business model where Alibaba procures NAND and we build the SSDs based on what they -- on the NAND they give us. So our margins -- our gross margins are significantly improved because of this.

因此，就我們業務的獲利能力而言，由於我們正在生產的產品需要購買 NAND，因此我們的毛利率大大低於公司平均值。因此，作為這個問題的一部分，或者說去年這個問題，我們開始為阿里巴巴的一個特定客戶轉向寄售業務模式，阿里巴巴採購 NAND，我們根據他們提供的 NAND 來構建 SSD我們。因此，我們的毛利率顯著提高。

But we also have a lot of other customers. Most of -- majority of our sales of our Shannon products are in fact standard NVMe SSDs to non-Ali customers. And for these customers, we're buying NAND, and so our gross margins are a lot lower.

但我們還有很多其他客戶。事實上，我們向非阿里客戶銷售的 Shannon 產品大部分都是標準 NVMe SSD。對於這些客戶，我們購買 NAND，因此我們的毛利率要低得多。

We have our next question coming from the line of Rajvindra Gill from Needham & Company.

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

And congratulations on the momentum, very impressive. Wallace and Riyadh, when you're putting up this $1 billion sales target, which is very ambitious, I just wanted to get a sense in terms of how to think about the cadence of that. If you look at your full year guidance in 2021, it's at $675 million at the midpoint. I believe that's the highest in recent history for your company in terms of overall revenue. Correct me if I'm wrong there. But it's extremely high, and that could be higher if you get more wafer allocation.

恭喜你們的勢頭，非常令人印象深刻。華萊士和利雅得，當你們提出這個非常雄心勃勃的 10 億美元銷售目標時，我只是想了解如何思考這一目標的節奏。如果您查看 2021 年全年指導，您會發現中間值為 6.75 億美元。我相信，就總收入而言，這是貴公司近期歷史上最高的。如果我錯了請糾正我。但它非常高，如果你獲得更多的晶圓分配，這個數字可能會更高。

So I wanted to get a sense from working off that base to get to $1 billion, that's about 50% growth. How do we think about the cadence on a kind of year-over-year basis? And is this really being driven by the combination of kind of higher attach rates that you're seeing in other adjacent markets outside of PCs? Is it being driven by consistent, sustainable market share gains? I'm just curious in terms of some of the color there.

所以我想從這個基礎上努力達到 10 億美元，也就是大約 50% 的成長。我們如何看待逐年的節奏？這真的是由您在個人電腦之外的其他鄰近市場看到的更高附加率的組合推動的嗎？它是由持續、可持續的市場份額成長所推動的嗎？我只是對那裡的一些顏色感到好奇。

Yes, I think you asked a very good question. We're definitely prepared to answer the questions. We have a very strong confidence to achieve our financial objective, $1 billion within 3 years. It is through our major design pipeline from client SSD controller as well as mobile eMMC+UFS controller.

是的，我認為你問了一個非常好的問題。我們絕對準備好回答這些問題。我們對在 3 年內實現 10 億美元的財務目標充滿信心。它是透過我們從客戶端 SSD 控制器到行動 eMMC+UFS 控制器的主要設計流程來實現的。

I think that we start to really cook the design win pipeline since 2 years ago, and we're really gaining momentum and market share, focused on technology for new product development, moving to 16-, 12-nanometer, mobile, we're going to move to 7-nanometer 3 years from now.

我認為我們從兩年前就開始真正完善設計贏得流程，我們確實獲得了動力和市場份額，專注於新產品開發技術，轉向 16 奈米、12 奈米、移動，我們正在三年後將轉向 7 奈米。

But I think for a lot of R&D investment, that's why you see our increased R&D expense in the last 2 years, year-by-year. I think from this current design pipeline from the backlog in our hand, PO in our hand, our sales, there is no restriction constraint for wafer supply will be much higher than our current full year guidance, 20% to 30%.

但我認為，對於大量的研發投資，這就是為什麼你會看到我們過去兩年的研發費用逐年增加。我認為從目前的設計管道來看，從我們手中的積壓，我們手中的PO，我們的銷售情況來看，沒有限制的晶圓供應限制會比我們目前的全年指導高很多，20%到30%。

That's why it gives us significant confidence and we can continue to carry the momentum from this year to next year. Yes. That's why we start to work with TSMC right now for 2022 wafer supply for all the different technology node, from 55-, 40-nanometer to 28-, 16-, 12-nanometer and make sure we can get sufficient supply to meet our major OEM customer requirement for 2022.

這就是為什麼它給了我們很大的信心，我們可以從今年到明年繼續保持這一勢頭。是的。這就是為什麼我們現在開始與台積電合作，為所有不同技術節點（從55 奈米、40 奈米到28 奈米、16 奈米、12 奈米）提供2022 年晶圓供應，並確保我們能夠獲得足夠的供應來滿足我們的主要需求。

Of course, I think TSMC -- we have a long-term relationship with TSMC and we have a significant good support from them in the past 10 years, then we probably can get more allocation in the second half of this year. There's no commitment right now. So we can only base on the committed wafer supply to make a full year guidance to the investor. But for 3 years for $1 billion target, we have a much better confidence to achieve the goal. Maybe it will be earlier.

當然，我認為台積電——我們與台積電有長期的合作關係，在過去的十年裡我們得到了他們的大力支持，那麼我們可能會在今年下半年獲得更多的分配。目前還沒有任何承諾。所以我們只能根據承諾的晶圓供應量來給投資者做出全年的指導。但對於3年10億美元的目標，我們更有信心實現這個目標。也許會更早一些。

Thank you for that. That's excellent news. And Riyadh, I know it might be hard to quantify, but just if you could give us some sense if you get more wafer allocation from TSMC, which you have a great relationship with to begin with. Any way to think about what the potential upside would be on that $675 million target?

謝謝你。這是個好消息。至於利雅得，我知道這可能很難量化，但如果你能從台積電獲得更多晶圓分配，你能給我們一些感覺嗎？有什麼辦法可以考慮 6.75 億美元目標的潛在上漲空間嗎？

Raji, that's another excellent question. The way to think about this is our operating infrastructure has the ability to have considerable operating leverage. The operating expense infrastructure that we have built, our R&D teams, our sale and marketing teams, the rest of our operating infrastructure, it's an infrastructure that we can load a lot more revenue on.

拉吉，這是另一個很好的問題。思考這個問題的方法是我們的營運基礎設施有能力擁有相當大的營運槓桿。我們建立的營運費用基礎設施，我們的研發團隊，我們的銷售和行銷團隊，我們其餘的營運基礎設施，這是我們可以加載更多收入的基礎設施。

And so for what we have today, and if we're able to achieve much higher levels of revenue this year, in the event we're able to secure additional wafer, there is no -- beyond what we have guided. If we're able to secure additional wafer, this would just flow through our P&L and deliver the incremental profitability on our bottom line.

因此，就我們今天所擁有的情況而言，如果我們今年能夠實現更高水準的收入，如果我們能夠獲得額外的晶圓，那麼就沒有超出我們指導的範圍。如果我們能夠獲得額外的晶圓，這將直接計入我們的損益表，並為我們的利潤帶來增量獲利能力。

The next question comes from the line of Craig from B. Riley Securities.

下一個問題來自 B. Riley Securities 的 Craig。

This is Carlin Lynch on for Craig. Congrats. And I just wanted to drill down on something that Wallace said on the last question. Did -- Wallace, when you said the 20% to 30%, is that the amount of supply constraint that you're currently seeing right now?

這是克雷格的卡林·林奇。恭喜。我只是想深入了解華萊士在最後一個問題上所說的內容。華萊士，當您提到 20% 到 30% 時，這就是您目前看到的供應限制嗎？

So in theory, if there were no supply constraints, the guidance would have been 20% to 30% higher. Did I understand that right?

因此理論上，如果沒有供應限制，指導價會高出 20% 至 30%。我理解對了嗎？

No. I'm saying is, we've guided 20% to 30% growth from 2020 based on our current variable wafer committed. But we can grow much higher and guide much higher if we can get an incremental with allocation from our foundry supplier.

不，我的意思是，根據我們目前承諾的可變晶圓，我們指導從 2020 年開始實現 20% 到 30% 的成長。但如果我們能夠從我們的代工供應商那裡獲得增量分配，我們就可以成長得更高，指導也更高。

Got it. Okay. Sorry about the miscommunication. So my second question is, on the new -- you mentioned that a bunch of smaller suppliers or a bunch of customers have kind of come your way due to the supply constraints. What are you guys doing? And how confident are you that you can hold on to these new customers as they come towards you, given that you're already supply constrained?

知道了。好的。很抱歉溝通不良。所以我的第二個問題是，關於新的——你提到，由於供應限制，一些較小的供應商或一些客戶已經來到你的身邊。你們在做什麼？鑑於您的供應已經受到限制，您對能夠留住這些向您走來的新客戶有多大信心？

Yes. Most of these new demands are really not a major customer. As you know, some of our customers maybe 80% use our controller, 20% use other controller maker in order to bargain the price with us in the past many years.

是的。這些新需求大部分其實都不是大客戶。如您所知，在過去的幾年裡，我們的一些客戶可能80%使用我們的控制器，20%使用其他控制器製造商，以便與我們討價還價。

But now because wafer is shortage globally. So many small player controller player, they even probably cannot get even worse wafer supply to their demand. That's why a lot of the customer before is maybe 80% come to us not gave us a 90%, 95% order to us.

但現在因為全球晶圓短缺。如此多的小型控制器玩家，他們甚至可能無法獲得更差的晶圓供應來滿足他們的需求。這就是為什麼之前很多客戶可能80%來找我們，而不是給我們90%、95%的訂單。

But that is now our really main goal. I think from the existing original estimation for our business is stronger than 30% growth year-over-year. But with additional fee demand just make our allocation even worse than what we can offer to the customers.

但這是我們現在真正的主要目標。我認為從現有的原始估計來看，我們的業務年增超過 30%。但額外的費用要求只會使我們的分配比我們能為客戶提供的更糟糕。

Got it. Okay. And then one last quick one for me. Obviously, I understand what's going on with gross margin, given the higher kind of inputs this year and not wanting to provide any insight about price increases at this point.

知道了。好的。然後是我的最後一個快速的。顯然，鑑於今年的投入較高，目前不想提供有關價格上漲的任何見解，我了解毛利率的情況。

But as I look out to fiscal '22, and you mentioned the 50% gross margin target, with Shannon now kind of a much smaller percentage of sales expected moving forward. Would it be fair to say that gross margin in calendar '22 can get back to the 50% maybe quicker than expected beyond all -- assuming that all of the things that are impacting gross margin this year come out of the model? It just seems to me that -- and then, ultimately, why isn't that number -- why couldn't that number be higher? We saw 50.1% in calendar '19. Just trying to get the sense of upside gross margin from the 48% guided to in calendar '21?

但當我展望 22 財年時，您提到了 50% 的毛利率目標，而香農現在預計未來銷售額的比例要小得多。假設今年影響毛利率的所有因素都來自該模型，那麼可以公平地說，22 日曆年的毛利率可能會比預期更快恢復到 50%？在我看來——然後，最終，為什麼不是這個數字——為什麼這個數字不能更高？我們在 19 年曆中看到了 50.1%。只是想從 21 日曆年指導的 48% 中了解毛利率上升的感覺嗎？

I think you are correct. Theoretically, we definitely show -- improve our gross margin in 2022. I think this is now the goal we're looking for. However, I think we all have some major program with the contract price. It all depend on our foundries provider, whether they will continue some regular wafer discount annually. Because of a severe shortage, they are not going to reduce the wafer price, instead, they increased wafer price.

我認為你是對的。從理論上講，我們肯定會在 2022 年提高毛利率。不過，我認為我們都有一些合約價格的重大項目。這一切都取決於我們的代工廠供應商，他們是否會每年繼續保持一些定期的晶圓折扣。由於嚴重短缺，他們不會降低晶圓價格，而是提高晶圓價格。

So we have to prepare all the different scenario to play conservative model. I think that's our obligation to the shareholder to make sure we give you conservative guidance, then we can have a better result than expectation.

所以我們必須準備好所有不同的場景來玩保守模型。我認為這是我們對股東的義務，確保我們為您提供保守的指導，然後我們才能得到比預期更好的結果。

We have the next question from the line of Gokul Hariharan from JPMorgan.

我們有來自摩根大通的 Gokul Hariharan 的下一個問題。

Congrats on the great results. So just wanted to understand, when we think about our $1 billion revenue target, do you think that the product mix is going to be reasonably similar to what we have right now? I think right now, we are probably about 55% to 60%. The controller is roughly about, I think 25% mobile or 30% mobile and about 10% to 15% SSD solution.

祝賀取得的優異成績。所以我想了解一下，當我們考慮 10 億美元的收入目標時，您認為產品組合會與我們現在的產品組合相當相似嗎？我想現在我們可能是55%到60%左右。控制器大約是，我認為 25% 移動或 30% 移動，大約 10% 到 15% SSD 解決方案。

Is the mix going to be fairly similar when we get there? Could you talk a little bit about how we think about that? And then I had a follow-up question.

當我們到達那裡時，混合會相當相似嗎？您能談談我們對此的看法嗎？然後我有一個後續問題。

I think, roughly, the mix will be maintained the same. As I said in our statement, we don't count the new customer -- customers we don't have today. We based on existing NAND maker and module maker customer, we are able to achieve the $1 billion target within 3 years.

我認為，粗略地說，混合將保持不變。正如我在聲明中所說，我們不計算新客戶——我們今天還沒有的客戶。我們基於現有的NAND製造商和模組製造商客戶，我們能夠在3年內實現10億美元的目標。

So we have enough design pipeline from PCIe Gen3 to PCIe Gen4, from eMMC to UFS 2.0, 3.1. We don't even count enterprise controller. We don't count on even UFS 4.0, we think we can achieve $1 billion target within 3 years.

所以我們有足夠的設計管道，從 PCIe Gen3 到 PCIe Gen4，從 eMMC 到 UFS 2.0、3.1。我們甚至不計算企業控制者。我們甚至不指望UFS 4.0，我們認為我們可以在3年內實現10億美元的目標。

Gokul, let me also add, while -- when we achieve $1 billion of sales, the product mix should be quite similar to what it is today, but I would also add that our mobile controllers, our eMMC+UFS, we're expecting to grow a little bit faster than our SSD controllers over the next 3 years.

Gokul，我還要補充一點，當我們實現 10 億美元的銷售額時，產品組合應該與今天非常相似，但我還要補充一點，我們的行動控制器、我們的 eMMC+UFS，我們期望在未來3 年內，其成長速度將比我們的SSD 控制器快一點。

Got it. Just related questions. What gives you the visibility? And pardon me for asking, but revenues have essentially been in the $500 million to $550 million range for probably 3 to 4 years, right?

知道了。只是相關問題。是什麼給了你可見性？請原諒我問，收入基本上在 5 億至 5.5 億美元範圍內持續了 3 至 4 年，對嗎？

So I just wanted to understand what gives us the visibility given the business nature, especially for the mobile side and to some extent, for the module makers also in consumer have been fairly volatile. So what is the confidence interval on this? And what gives you that visibility suddenly to change that?

因此，我只是想了解，考慮到業務性質，尤其是行動端，以及在某種程度上，消費者領域的模組製造商一直相當不穩定，是什麼讓我們能夠獲得可見性。那麼這個的置信區間是多少呢？是什麼給了你突然的可見性來改變這一點？

Second, then we have foundry shortages like this in the past in, let's say, 2017 or 2014, we've clearly had a lot of kind of concerns about inflated orders from customers, especially like PC module customers, eMMC customers, et cetera. How do you discount for that factor when you think about your forecast and your POS from customers?

其次，我們過去曾遇到這樣的代工短缺，比如說2017年或2014年，我們顯然對客戶訂單膨脹有很多擔憂，尤其是PC模組客戶、eMMC客戶等。當您考慮您的預測和客戶的 POS 時，您如何考慮該因素？

Okay. Let me just give you answer first. So first question, the reason we have high confidence to achieve a $1 billion target by 2023 is based on current -- the booking backlog PO in our hands for 2021. As we said already, we -- based on our variable wafer -- committed wafer supply, we have the 100% confidence to reach 20% to 30% growth from 2020.

好的。我先給你答案吧。所以第一個問題，我們對在2023 年實現10 億美元目標充滿信心的原因是基於當前——我們手中的2021 年訂單積壓訂單。圓－承諾晶圓供應方面，我們有100%的信心從2020年起達到20%至30%的成長。

But our backlog and the PO in hand are much bigger than this number. So this going to carry -- continue to 2022. And because that is a major design pipeline, very hard to customer -- major customer to change the design. And we also continue work with TSMC. Hopefully, they can provide more wafer. But as you know very well, it's a very difficult moment.

但我們的積壓訂單和手頭上的 PO 比這個數字大得多。因此，這將持續到 2022 年。我們也繼續與台積電合作。希望他們能夠提供更多的晶圓。但正如你所知，這是一個非常困難的時刻。

And as to the -- to answer your second question, yes, we suffered one of the major NAND makers for eMMC business from the peak of 2016, and they start to use internal controller, then we suffer the sale revenue decline, a down to very, very slow last year, then that actually will be gone. For UFS 2.0, 3.0, I think it's going to stay for next 3 years, UFS 4.0 will start to picking up from 2024. So we have very high confidence our business model and growing our eMMC customers are very, very strong. We are the dominating eMMC provider outside the NAND makers.

至於- 回答你的第二個問題，是的，我們從2016 年的eMMC 業務高峰期開始遭遇了eMMC 業務的主要NAND 製造商之一，他們開始使用內部控制器，然後我們遭受銷售收入下降，下降到去年非常非常慢，那麼實際上就會消失。對於UFS 2.0、3.0，我認為它將持續3年，UFS 4.0將從2024年開始回升。我們是 NAND 製造商以外的主導 eMMC 供應商。

So we probably own 80% of the market share, if you don't count on NAND maker customer. That's why we have confidence to grow mobile controller business as well as the client SSD business, which are very strong today. And that gave us the confidence to show how we can reach the outline for $1 billion sales target.

因此，如果不考慮 NAND 製造商客戶，我們可能擁有 80% 的市場份額。這就是為什麼我們有信心發展行動控制器業務以及客戶端 SSD 業務，這些業務如今非常強勁。這讓我們有信心展示如何實現 10 億美元的銷售目標。

Got it. Could you also tell us like, I think -- are you taking some discount or something for the POs that you get from your module maker customers or OEMs, even at times like this when we hear about shortage across the board. Clearly, there is some degree of inflated order books that is usual.

知道了。您是否也可以告訴我們，我想，您是否對從模組製造商客戶或 OEM 那裡獲得的採購訂單採取一些折扣或其他措施，即使在我們聽說全面短缺的時候也是如此。顯然，訂單簿存在一定程度的膨脹是很常見的。

So can you talk a little bit about how you think about the PO and the book -- order book and how you think about the health of that order book?

那麼您能否談談您對採購訂單和訂單簿的看法以及您對訂單簿健康狀況的看法？

I think some module maker POs, that's a very small portion, for our -- as a contribution for revenue. The major visibilities are OEM because they are also worried they cannot get a supply. That's why they gave us visibility much better because normally, they only give us 3 months PO and the 6 months forecast. Now they gave the full year PO, that's why we can see through the 2021 demand for our major OEM customer.

我認為對於一些模組製造商的採購訂單來說，這對我們來說只是很小的一部分——作為收入的貢獻。主要的知名度是 OEM，因為他們也擔心無法獲得供應。這就是為什麼他們為我們提供了更好的可見性，因為通常他們只給我們 3 個月的採購訂單和 6 個月的預測。現在他們給了全年的 PO，這就是為什麼我們可以看到我們主要 OEM 客戶在 2021 年的需求。

We have the next question from the line of Anthony J. Stoss.

我們有安東尼·J·斯托斯 (Anthony J. Stoss) 提出的下一個問題。

Boy, in the 10 years of covering Silicon Motion, I've never seen this kind of visibility from you guys and excitement. Maybe you can talk about if you've scrubbed the pipeline for 2021, if you think there's a chance that there's double ordering in that pipeline or if it's just mainly market share strength from you guys?

天哪，在報道慧榮科技的 10 年裡，我從未見過你們有如此高的關注和興奮感。也許你可以談談是否已經取消了 2021 年的管道，如果你認為該管道中有可能存在雙重訂購，或者這只是你們的市場份額優勢？

And then also, not including the enterprise controller in the 2023 revenue goal. I'm curious, maybe you can give us more detail. Is that behind plan? Or any more color would be helpful.

此外，2023 年收入目標中不包括企業控制器。我很好奇，也許你可以提供我們更多細節。這落後於計劃了嗎？或更多的顏色會有所幫助。

And then lastly, maybe for Riyadh, if Shannon continues to underperform, why not just walk away from Shannon? Why do we still keep it in operational?

最後，也許對利雅德來說，如果香農繼續表現不佳，為什麼不直接離開香農呢？為什麼我們仍然保持它的運作？

So let me comment for your first question. I think, last year, we have so many major designs for PC OEM, not just from NAND maker, but also from module maker, and they all start to ramp-up in 2021. That's why we see we gained market share for global client SSD controllers. And we expect to ship much more for this year.

那麼讓我對你的第一個問題發表評論。我認為，去年我們有很多針對 PC OEM 的主要設計，不僅來自 NAND 製造商，還來自模組製造商，它們都在 2021 年開始增加。器。我們預計今年的出貨量會更多。

However, due to the wafer shortage from the foundry makers, we can only provide such a guidance, but we originally expect to have even much stronger momentum if we can get a full supply from our TSMC major partner. This is depending on how we see the migration from the technology node from SATA, the PCIe Gen3 from PCIe Gen3 to PCIe Gen4, I think we will continue the momentum pipeline for clients SSD.

然而，由於晶圓代工廠商的晶圓短缺，我們只能提供這樣的指導，但我們原本預計，如果我們能夠從台積電主要合作夥伴那裡獲得全面供應，將會有更強勁的動力。這取決於我們如何看待技術節點從 SATA、PCIe Gen3 從 PCIe Gen3 到 PCIe Gen4 的遷移，我認為我們將繼續推動客戶端 SSD 的發展勢頭。

Regarding the mobile controller for eMMC and UFS, and we -- as I stated, we have more than 80% of global design outside the NAND makers. And a lot of these module makers has been prepared -- practice in the past 5 to 6 years. Now finally, they are entered design to smartphone in low-value line smartphone and from Chromebook and to set-top box and Smart TV. They are gaining market share.

關於 eMMC 和 UFS 的行動控制器，正如我所說，我們在 NAND 製造商之外擁有超過 80% 的全球設計。許多模組製造商已經做好了準備——在過去的五六年裡進行了實踐。現在，它們終於進入了低價值智慧型手機、Chromebook、機上盒和智慧電視的設計領域。他們正在贏得市場份額。

And please understand these module maker mobile controller revenue add together are close to the NAND maker sale revenue. So it's not like a very big gap between module maker and NAND maker. So we see the transition is very, very strong. And some module maker, or eMMC customer also turning into UFS. They give us a much broader angle looking for the pipeline, not just 2021, also beyond this year to 2022 and 2023.

請注意，這些模組製造商的行動控制器收入加起來接近 NAND 製造商的銷售收入。所以模組製造商和NAND製造商之間的差距並不是很大。所以我們看到這種轉變非常非常強烈。而一些模組製造商，或是eMMC客戶也開始轉向UFS。它們為我們尋找管道提供了更廣闊的視角，不僅是 2021 年，還包括今年之後到 2022 年和 2023 年。

We also have several major programs, which we cannot comment right now. When it's become materialized, we will talk to the -- our investors.

我們還有幾個主要項目，目前無法發表評論。當它成為現實時，我們將與我們的投資者交談。

Tony, let me also address your third question about Shannon. Shannon clearly has been a disappointment to us. But we're -- it's also a strategically important piece of business to us. And so we're actively working to restore this product line's growth and profitability. What I mean by strategically important is because without Shannon, we will not be able to sell SSD controllers, enterprise-grade SSD controllers directly to Chinese hyperscalers as they do not have the engineering capabilities to develop their own SSDs using merchant controllers, right?

東尼，讓我也回答你關於香農的第三個問題。香農顯然讓我們感到失望。但我們——這對我們來說也是一項具有戰略意義的重要業務。因此，我們正在積極努力恢復該產品線的成長和獲利能力。我所說的戰略重要性是因為如果沒有Shannon，我們將無法直接向中國超大規模企業出售SSD 控制器、企業級SSD 控制器，因為他們不具備使用商業控制器開發自己的SSD 的工程能力，對吧？

So Shannon designs these SSDs using our controllers and therefore, helps facilitate our sell into this market and also provide street credibility to our enterprise-grade controllers. Where, as you know, we're new to the enterprise SSD controller market, and so it's important to develop street credibility in Shannon. Through our experience, our exposure at Shannon with the Chinese hyperscalers, we're also gaining a lot of street credibility.

因此，Shannon 使用我們的控制器設計這些 SSD，有助於促進我們在這個市場的銷售，並為我們的企業級控制器提供街頭信譽。如您所知，我們是企業 SSD 控制器市場的新手，因此在香農建立街頭信譽非常重要。透過我們的經驗，以及我們在香農與中國超大規模企業的接觸，我們也獲得了許多街頭信譽。

So it's important for us to -- strategically important to us. We're working to fix the financial profiles of Shannon. But eventually, if we cannot fix this, then we may have to consider strategic options.

因此，這對我們來說很重要——對我們來說具有戰略意義。我們正在努力修復香農的財務狀況。但最終，如果我們無法解決這個問題，那麼我們可能不得不考慮戰略選擇。

Let me add a comment too, Riyadh. I think we underestimate the complexity for enterprise controller and enterprise business. Our competitor, the NAND maker, they spent 20 years' experience in the front end, then they are leading in the technology and product. We are just about 4 to 5 years, and we only focus on enterprise controller just about 2 years.

讓我也加入一則評論，利雅德。我認為我們低估了企業控制器和企業業務的複雜性。我們的競爭對手，NAND廠商，他們在前端花了20年的經驗，所以他們在技術和產品上都是領先的。我們大概只有4到5年的時間，我們只專注於企業控制器也就2年左右的時間。

So we learned so much from Shannon customer, especially from Alibaba, Baidu and [Biden] and several leading hyperscalers. Then we understand the complexity almost find time in client SSD. But we are improving fixes. We are filling the gap. We are gaining confidence and continue improving our firmware algorithm and our AC architecture. That's why we are so excited about enterprise PCIe Gen5 controller, which we will tape-out in early next year and assembling in the second half of 2022.

因此，我們從 Shannon 客戶那裡學到了很多東西，特別是從阿里巴巴、百度和 [拜登] 以及幾家領先的超大規模提供者那裡學到了很多東西。然後我們了解客戶端 SSD 的複雜性幾乎找不到時間。但我們正在改進修復。我們正在填補這一空白。我們正在獲得信心並繼續改進我們的韌體演算法和 AC 架構。這就是為什麼我們對企業 PCIe Gen5 控制器如此興奮，我們將在明年初流片並在 2022 年下半年組裝。

We believe this will bring us a big momentum and coming to enterprise. As you know well, client SSD in the next 3 to 5 years will be slowing down and saturated after 5 years from now. So we are preparing for another momentum to growth for enterprise controller. It's very important for a company to maintain the growth momentum continually and to the shareholder.

我們相信這將為我們企業帶來巨大的動力和動力。眾所周知，客戶端SSD在未來3到5年內將放緩並在5年後達到飽和。因此，我們正在為企業控制器的另一個成長動力做準備。持續保持成長動能對於公司和股東來說都非常重要。

If I'm not mistaken, didn't you say that you're not including any revenue from the enterprise controller in your $1 billion 2023 forecast? Is that just to play conservative given what you just said about...

如果我沒記錯的話，您不是說您在 2023 年 10 億美元的預測中沒有包括來自企業控制器的任何收入嗎？鑑於你剛才所說的，這只是為了保守嗎？

Exactly. Exactly. That's correct.

確切地。確切地。這是正確的。

We have our next question from the line of Mehdi Hosseini from SIG.

我們的下一個問題來自 SIG 的 Mehdi Hosseini。

Yes. This is Mehdi Hosseini from SIG. Just 2 follow-up. Riyadh, did you say that any wafer price increase is already dialed into your gross margin guide for 2021?

是的。我是 SIG 的 Mehdi Hosseini。只有 2 個後續行動。利雅得，您是否說過任何晶圓價格上漲都已納入您 2021 年的毛利率指南中？

Mehdi, we are not expecting wafer cost increase this year. We are, however, expecting cost from substrates and packaging, and that's reflected in the gross margin guidance that we have provided.

Mehdi，我們預計今年晶圓成本不會增加。然而，我們預計基材和包裝會產生成本，這反映在我們提供的毛利率指引中。

Okay. Clear. Just curious, if there is incremental capacity becoming available, but at a higher cost, would you be able to offset that?

好的。清除。只是好奇，如果有可用的增量容量，但成本更高，您能抵消嗎？

Depends on the pipeline. For very important mobile product line, high end, we definitely need to because our customers desperately need more supply.

取決於管道。對於非常重要的高端行動產品線，我們絕對需要，因為我們的客戶迫切需要更多的供應。

Okay. Got it. And then I joined the call a little bit late, so I apologize if the question has already been asked. But when you think about mobile opportunities, UFS and comparing it to SSD controller for 2021. Which segment do you expect to offer higher growth?

好的。知道了。然後我加入電話會議的時間有點晚了，所以如果問題已經被問到，我深表歉意。但是，當您考慮 2021 年的行動機會、UFS 並將其與 SSD 控制器進行比較時。

I think Riyadh has already mentioned, for total dollar amount client SSD is still bigger, where for the growth rate, mobile controller will be a little higher and faster because the base is smaller. And we -- because I think for mobile, major is only 3 NAND makers has a mobile DRAM. So it's very easy to figure out that's why the momentum will grow stronger if you have design in the 3 major NAND maker with mobile DRAM.

我認為利雅德已經提到，就總美元金額而言，客戶端SSD仍然更大，而就成長率而言，行動控制器會更高、更快，因為基數較小。而我們——因為我認為對於行動裝置來說，主要只有 3 家 NAND 製造商擁有行動 DRAM。因此很容易看出，如果你在行動 DRAM 的 3 大 NAND 製造商中進行設計，那麼勢頭將會變得更強。

Great. And then would you expect your mobile mix, especially from China or contribution from China, to increase as demand capacity comes online -- NAND capacity from domestic players?

偉大的。然後，您是否預期您的行動產品組合（尤其是來自中國或來自中國的貢獻）會隨著需求容量（來自國內廠商的 NAND 容量）的上線而增加？

When the China NAND maker increase the output, we definitely will benefit from these output because a lot of our module customers will also use the NAND from the China NAND makers. But I'm not sure how much they're going to impact for the mobile business because there probably will be in value line eMMC, but now in the high end eMMC or UFS.

當中國NAND製造商增加產量時，我們肯定會受益於這些產量，因為我們的許多模組客戶也會使用中國NAND製造商的NAND。但我不確定它們會對行動業務產生多大影響，因為可能會有價值線 eMMC，但現在是高階 eMMC 或 UFS。

If there are no further questions, I would like to hand the call back to our presenters for any closing remarks.

如果沒有其他問題，我想將電話轉交給我們的主持人，讓他們發表結束語。

Thank you, everyone, for joining us today and for your continuing interest in Silicon Motion. I would like to leave you with some final thoughts.

感謝大家今天加入我們並感謝您對慧榮的持續關注。我想留下一些最後的想法。

Our business continues to be quite resilient in spite of the volatility to our business caused by the pandemic, we continue to achieve well. I have never been more confident about our business. We look forward to a safer world free of devastation caused by the coronavirus. We also look forward to sharing with you the expected rapid growth of our business this year and our progress towards our 2023 $1 billion revenue target.

儘管疫情造成我們的業務波動，但我們的業務仍然具有相當的彈性，但我們仍然取得了良好的成績。我對我們的業務從未如此有信心。我們期待一個更安全的世界，沒有冠狀病毒造成的破壞。我們也期待與您分享我們今年業務的預期快速成長以及我們在實現 2023 年 10 億美元收入目標方面取得的進展。

We will be attending several virtual investor conferences in the next few months, the schedule of which will be posted on our Investor Relationship website. Thank you for continued interest and for listening to our call. Goodbye for now.

我們將在接下來的幾個月內參加幾次虛擬投資者會議，其時間表將發佈在我們的投資者關係網站上。感謝您的持續關注並收聽我們的電話。暫時再見了。

Thank you. Ladies and gentlemen, that does concludes the conference for today. Thank you for participating, and you may all disconnect now. Thank you.

謝謝。女士們、先生們，今天的會議到此結束。感謝您的參與，現在您可以斷開連接了。謝謝。