Semtech Corp (SMTC) 2023 Q3 法說會逐字稿

Greetings, and welcome to the Semtech Corporation Conference Call to Discuss the Third Quarter Fiscal Year 2023 Financial Results. Speakers for today's call will be Mohan Maheswaran, Semtech's President and Chief Executive Officer; and Emeka Chukwu, Semtech's Executive Vice President and Chief Financial Officer. Please note that this conference is being recorded. (Operator Instructions)

您好，歡迎參加 Semtech Corporation 電話會議，討論 2023 財年第三季財務業績。今天電話會議的發言人將是 Semtech 總裁兼執行長 Mohan Maheswaran； Semtech 執行副總裁兼財務長 Emeka Chukwu。請注意，本次會議正在錄製中。 （操作員說明）

I will now turn the call over to Semtech's Vice President of Investor Relations, Anojja Shah. Thank you. You may begin.

我現在將把電話轉給 Semtech 投資者關係副總裁 Anojja Shah。謝謝。你可以開始了。

Thank you, John. A press release announcing our unaudited results was issued after the market closed today and is available on our website at semtech.com. Today's call will include forward-looking statements that include risks and uncertainties that could cause actual results to differ materially from the results anticipated in these statements. For a more detailed discussion of these risks and uncertainties, please review the safe harbor statement included in today's press release and in the other Risk Factors section of our most recent periodic reports filed with the Securities and Exchange Commission.

謝謝你，約翰。今天收盤後發布了一份新聞稿，宣布我們未經審計的業績，可在我們的網站 semtech.com 上查看。今天的電話會議將包括前瞻性陳述，其中包括可能導致實際結果與這些陳述中預期結果有重大差異的風險和不確定性。有關這些風險和不確定性的更詳細討論，請查看今天的新聞稿以及我們向美國證券交易委員會提交的最新定期報告的其他風險因素部分中包含的安全港聲明。

As a reminder, comments made on today's call are current as of today only, and Semtech undertakes no obligation to update the information from this call should facts or circumstances change. During this call, all references made to financial results in our prepared remarks will refer to non-GAAP financial measures, unless otherwise noted. A discussion of why the management team considers such non-GAAP financial measures useful, along with detailed reconciliations of such non-GAAP measures to the most comparable GAAP financial measures, are included in today's press release.

提醒一下，今天電話會議中的評論僅截至今天，如果事實或情況發生變化，Semtech 沒有義務更新本次電話會議中的資訊。在本次電話會議中，除非另有說明，否則我們準備的發言中所有提及財務績效的內容都將指非公認會計準則財務指標。今天的新聞稿中討論了管理團隊為何認為此類非公認會計原則財務指標有用，以及此類非公認會計原則指標與最具可比性的公認會計原則財務指標的詳細調節。

And with that, I'll turn it over to our Chief Financial Officer, Emeka Chukwu. Emeka?

接下來，我會將其交給我們的財務長 Emeka Chukwu。埃梅卡？

Thank you, Anojja. Good afternoon, everyone. In Q3 fiscal '23, in line with our guidance, Semtech delivered Q3 net revenue of $177.6 million, a sequential decrease of 15% and a year-over-year decrease of 9%. We faced a challenging macroeconomic environment and see sustained softness in the consumer market and overall weakness in China, but we are beginning to see signs of stability on several bright spots. Our focus on regional revenue diversification is showing signs of success. We see accelerating adoption in North America and Europe for Tri-Edge for LoRa and our broad-based industrial and automotive protection business due to our targeted growth efforts with end customers.

謝謝你，阿諾賈。大家下午好。在 23 財年第三季度，根據我們的指引，Semtech 的第三季淨收入為 1.776 億美元，季減 15%，年減 9%。我們面臨著充滿挑戰的宏觀經濟環境，消費市場持續疲軟，中國整體疲軟，但我們開始在幾個亮點上看到穩定的跡象。我們對區域收入多元化的關注已顯示出成功的跡象。由於我們對最終客戶的有針對性的成長努力，我們看到 LoRa 的 Tri-Edge 以及我們廣泛基礎的工業和汽車保護業務在北美和歐洲的採用加速。

Overall, Q3 shipments into Asia, North America and Europe represented 71%, 15% and 14%, respectively. While this represented the ship-to addresses for our distributors and customers, we estimate that approximately 35% of our shipments are consumed in China, 28% in the Americas and 21% in Europe and the balance over the rest of the world. Looking at our end markets, our infrastructure end market grew 5% over the prior year, but declined 17% sequentially and represented 39% of total net revenues. Net revenue from the industrial end market also grew 7% year-over-year but declined 13% sequentially and represented 41% of total net revenues.

整體而言，第三季亞洲、北美和歐洲的出貨量分別佔 71%、15% 和 14%。雖然這代表了我們的經銷商和客戶的收貨地址，但我們估計我們的出貨量中約有35% 在中國消耗，28% 在美洲，21% 在歐洲，其餘的在世界其他地區。看看我們的終端市場，我們的基礎設施終端市場比上一年增長了 5%，但環比下降了 17%，佔總淨收入的 39%。工業終端市場的淨收入也較去年同期成長 7%，但季減 13%，佔總淨收入的 41%。

As I previously mentioned, we continue to see softness in consumer end markets where net revenues for high-end consumer decreased 43% over the prior year and 15% sequentially and represented 20% of total net revenues. Approximately 10% of high-end consumer net revenues was attributable to mobile devices, and approximately 10% was attributable to other consumer systems. Our sales channel remains consistent with distribution, representing approximately 83% of shipments and direct 17% of shipments. Our distributor POS declined during the quarter but remained balanced with approximately 38% of POS coming from infrastructure, 33% from the industrial segment and 29% coming from high-end consumer end market.

正如我之前提到的，我們繼續看到消費者終端市場的疲軟，高端消費者的淨收入比上年下降 43%，環比下降 15%，佔總淨收入的 20%。大約 10% 的高階消費者淨收入來自行動裝置，約 10% 來自其他消費系統。我們的銷售通路與分銷保持一致，約佔出貨量的 83%，直接出貨量佔 17%。我們的經銷商 POS 在本季有所下降，但保持平衡，約 38% 的 POS 來自基礎設施，33% 來自工業領域，29% 來自高端消費終端市場。

So far in Q4, we see signs that our POS is stabilizing and no longer declining. The Q3 bookings decreased sequentially and represented book-to-bill of less than 1. Bookings were generally weaker across all regions and end markets. And just as in POS, we are beginning to see stability in bookings over the past month. Our gross margin remains resilient. In Q3, gross margin increased 30 basis points sequentially to 65.5%. This is a new quarterly record, driven mostly by a lower mix of consumer revenue. For Q4, we are projecting a small decline of gross margin to 64.5% at the midpoint, driven by lower absorption due to the softer overall demand environment. We expect gross margins to hover at current levels, plus or minus 100 basis points until demand recovers.

到目前為止，第四季度，我們看到有跡象表明我們的 POS 正在穩定且不再下降。第三季的預訂量較上季下降，訂單出貨比低於 1。就像 POS 一樣，我們開始看到過去一個月的預訂量趨於穩定。我們的毛利率保持彈性。第三季度，毛利率較上季成長30個基點至65.5%。這是一個新的季度記錄，主要是由於消費者收入組合下降所致。對於第四季度，我們預期毛利率將小幅下降至中點 64.5%，這是由於整體需求環境疲軟導致吸收率下降。我們預計毛利率將徘徊在當前水平，上下浮動 100 個基點，直到需求恢復。

Q3 operating expenses decreased approximately 5% sequentially to $68 million as we took steps to respond to softening demand. For Q4, while maintaining our investments in new products, we will take additional measures to reduce operating expenses by approximately 10% sequentially in response to the weaker demand environment. Managing our cash flow is a focus in these challenging times. In Q3, cash flow from operations was unusually low at $18 million or 10% of revenue, reflecting elevated use of working capital as accounts receivable increased due to timing of shipments and as we continue to pay for prior period long lead time materials.

由於我們採取措施應對需求疲軟，第三季營運費用較上季下降約 5% 至 6,800 萬美元。第四季度，在維持新產品投資的同時，我們將採取額外措施，將營運費用環比降低約10%，以應對疲軟的需求環境。在這個充滿挑戰的時期，管理現金流是一個重點。第三季度，營運現金流異常低，為1,800 萬美元，佔收入的10%，反映出營運資金的使用增加，因為應收帳款因出貨時間而增加，而且我們繼續支付前期的長交貨期材料費用。

We expect our cash flow from operations to rebound in Q4 to normal seasonal levels. Cash, cash equivalents and marketable securities increased approximately $256 million to $618 million. The increase is primarily due to the $319.5 million in convertible notes we issued to help fund the proposed Sierra Wireless acquisition, slightly offset by a $203 million payment on our existing line of credit. The convertible notes resulted in net cash proceeds of approximately $280 million after expenses, sale of warrants and the cost of the convertible not hedged transactions we entered into in conjunction with the issuance of the notes. These convertible notes carry an interest rate of 1.625%, and will mature on November 1, 2027.

我們預計我們的營運現金流將在第四季度反彈至正常的季節性水準。現金、現金等價物和有價證券增加約 2.56 億美元，達到 6.18 億美元。這一增長主要是由於我們發行了 3.195 億美元的可轉換票據，以幫助為擬議的 Sierra Wireless 收購提供資金，但我們現有信貸額度支付的 2.03 億美元略有抵消。扣除費用、認股權證銷售以及我們在發行票據時進行的可轉換未對沖交易的成本後，可轉換票據帶來的淨現金收益約為 2.8 億美元。這些可轉換票據的利率為1.625%，將於2027年11月1日到期。

The conversion price of the notes, including the hedged transactions is $51.15. And on a non-GAAP basis, there will be no dilution below this price. In Q3, we did not repurchase any stock because of our pending acquisition of Sierra Wireless. We have approximately $209 million remaining in our share repurchase authorization. Going forward, we expect to primarily use our cash to pay down the expected debt from completing the Sierra Wireless acquisition. In Q3, accounts receivable increased 13% sequentially due to the timing of shipments and days of sales increased 9 days to 39 days.

該票據的轉換價格（包括對沖交易）為 51.15 美元。在非公認會計原則的基礎上，不會出現低於此價格的稀釋。在第三季度，由於我們即將收購 Sierra Wireless，因此我們沒有回購任何股票。我們的股票回購授權剩餘約 2.09 億美元。展望未來，我們預計將主要使用現金來償還完成對 Sierra Wireless 收購後的預期債務。第三季度，由於出貨時間和銷售天數增加 9 天至 39 天，應收帳款較上季成長 13%。

In Q3, net inventory in absolute dollar terms was up slightly sequentially and days of inventory increased 27 days sequentially to 150 days as we continue to receive previously committed long lead time materials despite the decline in demand. We expect net inventory to be flat to slightly down in Q4, reflecting the weaker demand environment. As we look forward to the pending acquisition of Sierra Wireless, we remain excited about the growth potential of the 2 companies when combined. Sierra's reported revenue is consistent with our expectation. And when complete, the transaction is expected to be immediately accretive to Semtech's non-GAAP EPS.

第三季度，以絕對美元計算的淨庫存環比略有上升，庫存天數環比增加 27 天至 150 天，因為儘管需求下降，我們仍繼續收到先前承諾的長交貨期材料。我們預計第四季淨庫存將持平或略有下降，反映出需求環境疲軟。當我們期待即將完成的 Sierra Wireless 收購時，我們對兩家公司合併後的成長潛力仍然感到興奮。 Sierra 報告的收入與我們的預期一致。交易完成後，預計將立即增加 Semtech 的非 GAAP 每股盈餘。

In summary, our business continues to be adversely impacted by the broad slowdown in China and the sustained weakness in the consumer market. Maintaining our financial health is paramount during these uncertain times. We have the management team that have the experience managing through industry downturns, and I'm confident that the proactive actions taken, our focus on new products, design wins, working capital management and geographic diversification will strengthen Semtech and prepare us well for the recovery.

總而言之，我們的業務持續受到中國經濟普遍放緩和消費市場持續疲軟的不利影響。在這些不確定的時期，維持我們的財務健康至關重要。我們的管理團隊擁有應對行業低迷的經驗，我相信我們所採取的積極行動、我們對新產品、設計獲勝、營運資本管理和地理多元化的關注將增強Semtech 的實力，並為我們的復甦做好準備。

I will now hand the call over to Mohan to share more details on the business.

我現在將把電話轉接給莫漢，分享有關該業務的更多細節。

Thank you, Emeka. Good afternoon, everyone. Let me begin by providing a brief update on our proposed acquisition of Sierra Wireless and will then share details of our Q3 fiscal year '23 performance by product group and then provide details on our outlook for Q4. With regards to our acquisition of Sierra Wireless, as previously announced, we received a second request from the U.S. Department of Justice. We are cooperating fully with the DOJ and providing them with their requested documents. In parallel, together with Sierra, we have made significant headway with integration planning and are prepared to close immediately when approval is accomplished.

謝謝你，艾梅卡。大家下午好。首先，我將簡要介紹我們擬議收購 Sierra Wireless 的最新情況，然後將按產品組分享我們 23 財年第三季度業績的詳細信息，然後提供我們對第四季度前景的詳細信息。關於我們對 Sierra Wireless 的收購，正如先前宣布的那樣，我們收到了美國司法部的第二次請求。我們正在與司法部充分合作，並向他們提供所需的文件。同時，我們與 Sierra 一起在整合規劃方面取得了重大進展，並準備在批准完成後立即關閉。

We continue to be extremely excited by the transformation we can drive in the entire IoT industry by bringing together the ultra-low power, long-range sensor benefits of LoRa technology, together with the low latency, high bandwidth network benefits of cellular technology. Our goal is to enable IoT deployment simplification through end-to-end connectivity and deliver a cloud chip IoT services platform that will accelerate our customers' digital transition to the Internet of Everything. We continue to receive very positive feedback from our customers as they start to recognize the disruptive potential of the combination of the 2 companies. A combination of optimizing LoRa and cellular technology is a highly strategic opportunity that will position Semtech as the clear leader in the fast-growing ultra-low power IoT market.

透過將 LoRa 技術的超低功耗、遠端感測器優勢與蜂窩技術的低延遲、高頻寬網路優勢結合在一起，我們可以推動整個物聯網產業的變革，對此我們仍然感到非常興奮。我們的目標是透過端對端連接簡化物聯網部署，並提供雲端晶片物聯網服務平台，加速客戶向萬物互聯的數位轉型。我們不斷收到客戶非常正面的回饋，因為他們開始認識到兩家公司合併的顛覆性潛力。優化 LoRa 和蜂窩技術的結合是一個高度策略性的機會，將使 Semtech 成為快速成長的超低功耗物聯網市場中明顯的領導者。

Now turning to our Q3 performance. Our Q3 net revenue was $177.6 million, slightly above the midpoint of our guidance range. We posted record non-GAAP gross margins of 65.5% and non-GAAP earnings per diluted share of $0.65. Despite the challenging macro environment, we continue to execute well, have solid new product releases, and new design win momentum and are very excited by our future growth prospects across all our target market segments. Let me begin with our Signal Integrity Product Group. Revenue was up 2% from Q3 of fiscal year '22 and represented 44% of total revenues. As expected, the weak economic environment in China is impacting infrastructure demand negatively. Our hyperscale data center business slowed in Q3, following a strong first half performance.

現在轉向我們第三季的表現。我們第三季的淨收入為 1.776 億美元，略高於我們指引範圍的中點。我們公佈了創紀錄的非 GAAP 毛利率 65.5%，非 GAAP 稀釋後每股收益為 0.65 美元。儘管宏觀環境充滿挑戰，我們仍然表現良好，新產品發布穩定，新設計贏得動力，並對我們所有目標細分市場的未來成長前景感到非常興奮。讓我從我們的訊號完整性產品組開始。營收較 22 財年第三季成長 2%，佔總營收的 44%。正如預期的那樣，中國疲軟的經濟環境正在對基礎設施需求產生負面影響。繼上半年表現強勁後，我們的超大規模資料中心業務在第三季放緩。

Despite the softer demand, our FiberEdge revenues doubled over the previous quarter as we increased our PMD penetration in the 400-gig active optical cable segment. In addition to solid FiberEdge momentum, our Tri-Edge platform continues to make excellent design-in progress in global data centers, predominantly in North America. We are pleased to report Tri-Edge has been selected by a major North American hyperscale data center provider in a new high-volume multiyear program to enable low power, low latency and low cost interconnects within their data centers. We expect to be in production on this project in the second half of the fiscal year '24.

儘管需求疲軟，但隨著我們提高 PMD 在 400 吉有源光纜領域的滲透率，我們的 FiberEdge 收入比上一季翻了一番。除了強勁的 FiberEdge 勢頭之外，我們的 Tri-Edge 平台繼續在全球資料中心（主要是北美）取得出色的設計進展。我們很高興地報告 Tri-Edge 已被北美一家主要超大規模資料中心供應商選中，參與一項新的大量多年計劃，以在其資料中心內實現低功耗、低延遲和低成本互連。我們預計該專案將在 24 財年下半年投入生產。

The benefits of Tri-Edge align well with the long-term goals of hyperscalers, focused on lowering the power and cost of their interconnects within their data centers. Tri-Edge and CopperEdge are starting to gain traction in advanced data centers in North America that are focused on leading edge, artificial intelligence or high-speed computing applications where both low cost and low latency are critical requirements. In addition to our current FiberEdge and Tri-Edge momentum, we continue to invest in new, higher-performance solutions that will enable further system-level innovation within the hyperscale data center market.

Tri-Edge 的優勢與超大規模企業的長期目標非常契合，即專注於降低資料中心內互連的功耗和成本。 Tri-Edge 和 CopperEdge 開始在北美的先進資料中心獲得關注，這些資料中心專注於前沿、人工智慧或高速運算應用，其中低成本和低延遲是關鍵要求。除了我們目前的 FiberEdge 和 Tri-Edge 勢頭之外，我們還將繼續投資新的、更高效能的解決方案，以實現超大規模資料中心市場的進一步系統級創新。

We recently demonstrated our first 200-gig per channel PAM4 FiberEdge platform. This innovative PMD platform will be used in 800 gigabit and 1.6 terabit optical modules deployed by hyperscalers. We also recently introduced our ultra-low power 50-gig per channel Tri-Edge solution for both ultra-low power 200-gig and 400-gig optical modules. In addition, we are starting to see great interest in our new CopperEdge ReDriver platform targeted at 100-gig per channel copper interconnects. We expect to announce more significant CopperEdge, Tri-Edge and FiberEdge design wins throughout FY '24. We remain confident that our full portfolio of data center platforms, including ClearEdge and Tri-Edge CDRs, FiberEdge PMDs and CopperEdge ReDrivers will enable us to continue to rapidly grow our hyperscale data center business nicely over the next several years.

我們最近展示了我們的第一個每通道 200g PAM4 FiberEdge 平台。這項創新的 PMD 平台將用於超大規模企業部署的 800 Gb 和 1.6 TB 光學模組。我們最近也推出了適用於超低功耗 200 GB 和 400 GB 光學模組的超低功耗每通道 50 GB Tri-Edge 解決方案。此外，我們開始看到人們對新的 CopperEdge ReDriver 平台產生了濃厚的興趣，該平台的目標是每通道 100 GB 銅互連。我們預計在 24 財政年度宣布更多重大的 CopperEdge、Tri-Edge 和 FiberEdge 設計成果。我們仍然相信，我們的完整資料中心平台產品組合（包括 ClearEdge 和 Tri-Edge CDR、FiberEdge PMD 和 CopperEdge ReDriver）將使我們能夠在未來幾年內繼續快速發展我們的超大規模資料中心業務。

In Q3, our PON business also declined sequentially due to weakening demand in China, but was up approximately 36% on an annual basis and is on track to deliver another record year. We continue to see relative strength in 10-gig PON OLTs and ONUs while gigabit PON demand is weakening. While most of our PON revenues today are from China, we are starting to see increasing deployments of 10-gig PON outside China. In addition, we are actively engaged with leading PON system providers globally who are focused on higher bandwidth PON deployments. We expect global PON deployments to continue to accelerate as demand for higher access bandwidth is expected to increase in the future.

第三季度，由於中國需求疲軟，我們的 PON 業務也較上季下滑，但年增約 36%，可望再創歷史新高。我們繼續看到 10 吉位 PON OLT 和 ONU 的相對強勢，而千兆位元 PON 需求正在減弱。雖然我們目前的 PON 收入大部分來自中國，但我們開始看到中國以外地區 10 Gb PON 的部署不斷增加。此外，我們也積極與全球領先的 PON 系統供應商合作，他們專注於更高頻寬的 PON 部署。我們預計，隨著未來對更高存取頻寬的需求增加，全球 PON 部署將持續加速。

While weakness in China is a major headwind at this time, we remain confident this business will grow nicely over the next several years as other regions deploy PON solutions and as our China business recovers. Revenue from our wireless base station business was down in Q3, both on a sequential and year-over-year basis. This was mostly driven by economic weakness in China, which negatively impacted 4G and 5G deployments. However, our 5G revenues grew 75% on an annual basis as European customers start to expand their 5G footprint. In Q3, we announced the production release of our Tri-Edge 5G base station platform, targeted at 50 gigabit per second PAM4 fronthaul links.

雖然目前中國市場的疲軟是一個主要阻力，但我們仍然相信，隨著其他地區部署 PON 解決方案以及我們中國業務的復甦，這項業務將在未來幾年內實現良好成長。第三季我們的無線基地台業務收入較上季和年比均有所下降。這主要是由於中國經濟疲軟對 4G 和 5G 部署產生了負面影響。然而，隨著歐洲客戶開始擴大其 5G 覆蓋範圍，我們的 5G 收入每年增長 75%。第三季度，我們宣布推出 Tri-Edge 5G 基地台平台，目標是每秒 50 GB 的 PAM4 前傳連結。

This Tri-Edge platform is a bidirectional analog PAM4 CDR with an integrated differential driver, offering ultra-low latency and low power and enables the use of low-cost 25-gigabit per second optics to operate at 50 gigabit per second. We already have numerous 5G base station design-ins with both our ClearEdge and Tri-Edge platforms and expect continued adoption throughout FY '24 and enough initial production revenues in the second half of FY '24.

這款 Tri-Edge 平台是一款具有整合差分驅動器的雙向類比 PAM4 CDR，可提供超低延遲和低功耗，並支援使用低成本 25 Gb/s 光學元件以 50 Gb/s 的速度運作。我們已經透過 ClearEdge 和 Tri-Edge 平台進行了大量 5G 基地台設計，預計整個 24 財年將繼續採用，並在 24 財年下半年獲得足夠的初始生產收入。

While overall macroeconomic conditions continue to delay the rollout of 5G infrastructure, we are seeing more global deployments driven by European 5G vendors, which will provide more geographical balance in this business. As a result of demand weakness and excess inventory in China, we expect the infrastructure market to remain weak and expect our Signal Integrity Product Group revenues to decline in Q4. However, we still anticipate that our Signal Integrity Product Group will deliver record annual revenues for FY '23.

雖然整體宏觀經濟狀況繼續推遲 5G 基礎設施的推出，但我們看到歐洲 5G 供應商推動了更多的全球部署，這將為該業務提供更多的地理平衡。由於中國需求疲軟和庫存過剩，我們預期基礎設施市場將持續疲軟，並預期第四季我們的訊號完整性產品組營收將下降。然而，我們仍然預計我們的訊號完整性產品組將在 23 財年實現創紀錄的年收入。

Moving on to our Protection Product Group. In Q3, our Protection revenues were down 27% sequentially and represented 22% of total revenues. Extreme softness from the high-end consumer market negatively impacted our business, lower revenues from our Asian smartphone customers and broad consumer weakness offset record revenues from our North American smartphone customers. We believe we are very well-positioned in the consumer protection market with a strong USB-C protection portfolio, which is expected to be the high-speed interface of choice across most future consumer segments. Our broader industrial protection business, which represents a wide range of end markets across all regions, showed resilience in the Americas and Europe markets.

繼續我們的保護產品組。第三季度，我們的保護收入季減 27%，佔總收入的 22%。高端消費市場的極度疲軟對我們的業務產生了負面影響，亞洲智慧型手機客戶的收入下降以及消費者普遍疲軟抵消了北美智慧型手機客戶創紀錄的收入。我們相信，憑藉強大的 USB-C 保護產品組合，我們在消費者保護市場中處於非常有利的位置，預計 USB-C 將成為未來大多數消費者細分市場的首選高速介面。我們更廣泛的工業保護業務代表了所有地區的廣泛終端市場，在美洲和歐洲市場中展現了韌性。

We are seeing continued positive traction in the automotive segment as our Ethernet shield, display shield and antenna shield products are all gaining momentum as our customers integrate more advanced lithography technologies with higher-speed interfaces into their vehicles. Our Protection Shield solutions also have solid design win momentum at several of the top global EV makers, which is the fastest-growing sub-segment of the automotive market. We recently announced our new HotSwitch platform for industrial and communications applications. This truly innovative system protection platform provides new protection features that will safeguard systems, prolonging the lifespan of electronic devices and reducing electronic waste.

隨著我們的客戶將更先進的光刻技術和更高速的介面整合到他們的車輛中，我們的乙太網路屏蔽、顯示器屏蔽和天線屏蔽產品都在獲得動力，我們看到汽車領域持續受到積極的關注。我們的 Protection Shield 解決方案在全球幾家頂級電動車製造商中也擁有堅實的設計贏得勢頭，這是汽車市場成長最快的細分市場。我們最近發布了適用於工業和通訊應用的新 HotSwitch 平台。這個真正創新的系統保護平台提供了新的保護功能，可以保護系統，延長電子設備的使用壽命並減少電子廢棄物。

As the overall macro environment improves, we remain well-positioned to grow in the broader protection market with a well-rounded protection portfolio for high-speed interfaces, such as 10-gig Ethernet, USB Type-C, touch displays and antennas and expect our broader industrial protection business to deliver record revenues in FY '23. While we are starting to see demand levels stabilize due to high consumer inventory levels, we expect the protection business to further decline in the fourth quarter.

隨著整體宏觀環境的改善，我們仍處於有利位置，可以透過針對高速介面（例如10 Gb 乙太網路、USB Type-C、觸控顯示器和天線）的全面保護產品組合，在更廣泛的保護市場中實現成長，並預計我們更廣泛的工業保護業務將在 23 財年實現創紀錄的收入。雖然由於消費者庫存水準較高，我們開始看到需求水準趨於穩定，但我們預期保護業務將在第四季進一步下降。

Turning to our Wireless and Sensing Product Group. In Q3, revenues from our Wireless and Sensing Product Group declined 3% from the same quarter a year ago and represented 34% of our total revenues. Our LoRa-enabled revenues grew 36% annually driven by growth from the smart building, industrial IoT and smart city segments. LoRa revenues increased nicely in North America and Europe, but remained weak in China due to ongoing COVID lockdowns and general economic softness in the region. LoRa continues to be utilized across a broad range of exciting use cases, and we are seeing increasing global adoption of LoRa due to its ultra-low power, long range and low cost connectivity.

轉向我們的無線和感測產品組。第三季度，無線和感測產品集團的營收較去年同期下降 3%，佔總營收的 34%。在智慧建築、工業物聯網和智慧城市領域成長的推動下，我們支持 LoRa 的營收每年增長 36%。 LoRa 在北美和歐洲的營收成長良好，但由於持續的新冠疫情封鎖和該地區總體經濟疲軟，在中國的收入仍然疲軟。 LoRa 繼續在各種令人興奮的用例中得到利用，而且我們看到 LoRa 由於其超低功耗、遠距離和低成本連接而在全球範圍內得到越來越多的採用。

Here are a few exciting announcements from this past quarter. Exeger is integrating Lora Edge with a unique solar cell technology for indoor and outdoor asset tracking and global supply chain logistics, combining Semtech's Lora Edge asset management platform with Exeger's Powerfoyle solar cell technology significantly extends the battery life of asset tracking and environmental sensing devices. CWD introduced a new module combining LoRa and Bluetooth to bring the LoRaWAN capabilities to hazardous work environments such as oil rigs, mines and construction sites where employee safety is the first priority. These easy-to-deploy IoT modules enable the tracking and monitoring of employee safety.

以下是上個季度發布的一些令人興奮的公告。 Exeger 正在將Lora Edge 與獨特的太陽能電池技術集成，用於室內外資產追蹤和全球供應鏈物流，將Semtech 的Lora Edge 資產管理平台與Exeger 的Powerfoyle 太陽能電池技術相結合，顯著延長資產追蹤和環境感測設備的電池壽命。 CWD 推出了一款結合 LoRa 和藍牙的新模組，將 LoRaWAN 功能引入危險的工作環境，例如石油鑽井平台、礦場和建築工地，在這些環境中，員工安全是首要任務。這些易於部署的物聯網模組可以追蹤和監控員工的安全。

Intent Technologies announced its Lora-enabled smart property solution, which enables improvements in the operating performance of a building is being adopted by Nexity, a leading real estate service provider to optimize performance, improve quality of service and reduce the carbon footprint in residential and commercial properties. The platform has already achieved a 10% savings in overall building operational costs. Kiwi Technology introduced a new fully autonomous LoRaWAN-enabled network control unit or gas metering. This new comprehensive NCU will enable multiple remote meter reads per day and allows customers access to their real-time and historical gas consumption trends to identify cost savings and discover waste reduction opportunities.

Intent Technologies 宣布推出支援Lora 的智慧物業解決方案，該解決方案能夠提高建築物的營運效能，領先的房地產服務供應商Nexity 正在採用該解決方案，以優化性能、提高服務品質並減少住宅和商業的碳足跡特性。該平台已實現整體建築營運成本節省 10%。 Kiwi Technology 推出了全新的完全自主的支援 LoRaWAN 的網路控制單元或燃氣計量。這種新型綜合 NCU 將實現每天多次遠端抄表，並允許客戶存取其實時和歷史燃氣消耗趨勢，以識別成本節約並發現減少浪費的機會。

The NCU also anticipates and remotely shuts off gas in potentially dangerous situations. Kiwi Technology expects these meters to remain fully autonomous for 10 years. This week, at Amazon's re:Invent conference, we announced that Amazon Web Services is integrating our LoRa Cloud geolocation capabilities into their AWS IoT core platform and launching a new service to simplify asset tracking solutions using AWS. Customer adoption is already beginning, and we will expect -- and we expect this will enable the broad expansion of our LoRa Cloud geolocation services and our LoRa Edge silicon platform in the future.

NCU 還可預測並遠端關閉潛在危險情況下的燃氣。 Kiwi Technology 預計這些儀表將在 10 年內保持完全自主。本週，在Amazon 的re:Invent 大會上，我們宣布Amazon Web Services 正在將我們的LoRa 雲端地理定位功能整合到其AWS IoT 核心平台中，並推出一項新服務，以使用AWS 簡化資產追蹤解決方案。客戶採用已經開始，我們預計，這將使我們的 LoRa 雲端地理定位服務和 LoRa Edge 晶片平台在未來廣泛擴展。

LoRa's global adoption continues to make very positive progress and our metrics dashboard indicate solid momentum. These metrics include the number of public LoRaWAN network operators grew to 178, up from 173 at the end of Q2. In addition to public networks, private networks are also experiencing significant growth as evidenced by many new use cases and applications. We expect approximately 180 public LoRaWAN network operators by the end of FY '23. There were 5.6 million LoRa gateways deployed at the end of Q3, ahead of our [FY '23] target of 5.5 million. This was driven by growth in Amazon Sidewalk gateway deployments, which were up 14% sequentially and up 120% annually and private network gateway deployments, which increased 13% sequentially and 45% on an annual basis.

LoRa 的全球採用持續取得非常積極的進展，我們的指標儀表板顯示出強勁的勢頭。這些指標包括公共 LoRaWAN 網路營運商的數量從第二季末的 173 個增加到 178 個。除了公共網路之外，專用網路也正在經歷顯著成長，許多新的用例和應用程式證明了這一點。我們預計到 23 財年末將有約 180 家公共 LoRaWAN 網路營運商。截至第三季末，部署了 560 萬個 LoRa 網關，超出了我們 [23 財年] 550 萬個的目標。這是由 Amazon Sidewalk 閘道部署的成長所推動的，Amazon Sidewalk 閘道部署量較上季成長 14%，年成長 120%，而私人網路閘道部署則較上季成長 13%，年成長 45%。

Macro gateway deployments also increased 10% sequentially and 33% on an annual basis. We expect these global gateway deployments to drive an acceleration in end device attach rates over the next several years as numerous new use cases increasingly adopt low-power sensor networks. The cumulative number of LoRa end nodes deployed increased 15% sequentially to 280 million at the end of Q3. We expect this number to exceed 300 million cumulative end nodes by the end of FY '23. With the increased interest in adopting digital technologies to monitor and preserve our natural resources and to help mitigate climate-related issues, we expect end node deployments to accelerate rapidly over the next 3 to 5 years.

宏網關部署量也較上季成長 10%，年增 33%。我們預計，隨著許多新用例越來越多地採用低功耗感測器網絡，這些全球網關部署將在未來幾年內推動終端設備連接率的加速。截至第三季末，累計部署的 LoRa 終端節點數量較上季成長 15%，達到 2.8 億個。我們預計到 23 財年末，這一數字將累積超過 3 億個終端節點。隨著人們對採用數位技術來監控和保護自然資源以及幫助緩解氣候相關議題的興趣日益濃厚，我們預計終端節點部署將在未來 3 到 5 年內迅速加速。

Excluding China, we expect our FY '23 LoRa-enabled end nodes to increase on an annual basis by approximately 60%, confirming the increasing attach rate of LoRa end devices to installed gateways globally. Our LoRa opportunity pipeline at the end of Q3 was approximately $1.1 billion. We anticipate that, on average, 40% to 50% of the opportunities currently in the pipeline will convert to real deployments over a 24-month timeline. Over 82% of our LoRa opportunity funnel is currently from regions outside of China.

除中國外，我們預計 23 財年支援 LoRa 的終端節點將每年成長約 60%，證實了 LoRa 終端設備與全球已安裝閘道的連接率不斷增加。截至第三季末，我們的 LoRa 機會管道約為 11 億美元。我們預計，平均而言，目前正在醞釀的機會中有 40% 到 50% 將在 24 個月的時間內轉化為實際部署。目前，我們超過 82% 的 LoRa 機會漏斗來自中國以外的地區。

In Q4, we expect our Wireless and Sensing business to decline as weakness in China and a weak consumer business negatively impacted both our LoRa and proximity sensing business. However, driven by record LoRa-enabled revenues, which we will expect -- which we expect will grow approximately 39% in FY '23, we anticipate our Wireless and Sensing business to deliver another record revenue year in FY '23 despite very weak consumer revenues. In Q3, we released 12 new products and achieved 2,189 new design wins, positioning us very well for future growth as macro trends improve.

第四季度，我們預計我們的無線和感測業務將下滑，因為中國市場疲軟以及消費業務疲軟對我們的 LoRa 和接近感測業務產生了負面影響。然而，在LoRa 收入創紀錄的推動下（我們預計該收入將在23 財年增長約39%），我們預計我們的無線和感測業務將在23 財年再創紀錄的收入年度，儘管消費者非常疲軟收入。第三季度，我們發布了 12 款新產品，並贏得了 2,189 項新設計，隨著宏觀趨勢的改善，我們為未來的成長做好了準備。

Looking forward to the fourth quarter of fiscal year '23, we see continued demand challenges in China, resulting in weaker than normal seasonality. However, we are starting to see signs of stability in both demand and POS, including from China. As a result, we expect our Q4 net revenues to be between $145 million and $155 million. To attain the midpoint of our guidance range or approximately $150 million, we needed [terms] orders of approximately 27% at the beginning of Q4. We expect our Q4 non-GAAP earnings to be between $0.44 and $0.52 per diluted share.

展望'23財年第四季度，我們看到中國的需求持續面臨挑戰，導致季節性弱於正常水平。然而，我們開始看到需求和 POS 穩定的跡象，包括來自中國的需求。因此，我們預計第四季淨收入將在 1.45 億美元至 1.55 億美元之間。為了達到我們指引範圍的中點或大約 1.5 億美元，我們需要在第四季初獲得約 27% 的訂單。我們預計第四季非 GAAP 攤薄後每股收益將在 0.44 美元至 0.52 美元之間。

I will now hand the call back to the operator. Emeka Chukwu and I are happy to answer any of your questions. Operator?

我現在將把電話轉回給接線生。 Emeka Chukwu 和我很樂意回答您的任何問題。操作員？

We will now be conducting a question-and-answer session. (Operator Instructions) Our first question comes from the line of Tore Svanberg with Stifel.

我們現在將進行問答環節。 （操作員說明）我們的第一個問題來自 Tore Svanberg 和 Stifel 的線路。

The first question is on your current number there for the January quarter. So I think last quarter, I think you expected 0% churns, obviously now quite a bit higher. Does that mean, Mohan, that kind of like the supply and demand is back in balance? Because I think historically you turn about 20%, 30% on any given quarter. And as a follow-up to that, what gives you the confidence that you can actually achieve the 27% terms?

第一個問題是關於您一月份季度的當前數字。所以我認為上個季度，您預計流失率為 0%，顯然現在要高得多。莫漢，這是否意味著供需已恢復平衡？因為我認為從歷史上看，任何特定季度的成長率都在 20% 到 30% 左右。作為後續行動，是什麼讓您有信心真正實現 27% 的目標？

Yes. I think that is correct, Tore. It's -- supply lead times are starting to normalize and get back to what they kind of historically have been. There are also – there's also inventory in place. So, meeting short lead time orders is not going to be as difficult as it has been in the past. I think also with the POS stabilizing and the general feeling that consumer, for example, has been extremely weak for a long period of time and starting to see some improvement in bookings there gives us that confidence. And as you point out, yes, historically, we've turned 30%, 40% a quarter fairly frequently.

是的。我認為這是正確的，托爾。供應交貨時間開始正常化，並恢復到歷史水準。還有——還有庫存。因此，滿足短交貨期訂單將不會像過去那樣困難。我認為，隨著 POS 的穩定性以及消費者的普遍感覺，例如，在很長一段時間內一直極其疲軟，並且開始看到那裡的預訂有所改善，這給了我們信心。正如您所指出的，是的，從歷史上看，我們每個季度的成長率相當頻繁地達到 30%、40%。

And as a follow-up to Emeka, Emeka, when you talk about OpEx next quarter, you mentioned a 10% number. So is that total OpEx down 10% sequentially? And would this sort of be the new run rate going forward for as we model the rest of the year?

作為 Emeka 的後續行動，Emeka，當您談論下個季度的營運支出時，您提到了 10% 的數字。那麼總營運支出是否比上一季下降了 10%？當我們對今年剩餘時間進行建模時，這會是新的運行率嗎？

Yes, it is 10% down sequentially. As you know, Tore, when we start a new fiscal year, there are additional expenses that will come out, right, higher taxes and things like that. So the operating expenses I would expect going forward, it's probably going to be a little bit up in the first quarter and the first half of next year, but I think the run rate is going to be significantly down from what it was for fiscal year '23. As a matter of fact, I will probably expect the quarterly run rate to be about $63 million, $64 million a quarter.

是的，環比下降了 10%。如你所知，托爾，當我們開始新的財政年度時，將會產生額外的費用，對吧，更高的稅收等等。因此，我預計未來的營運支出，第一季和明年上半年可能會略有上升，但我認為運行率將比本財年大幅下降'23。事實上，我預計季度運行率可能約為 6,300 萬美元，每季 6,400 萬美元。

Just one last house-keeping one. You mentioned that 82% of the LoRa funnel is outside of China, which means 18% in the funnel is China. Why would -- that would be currently as far as revenue is concerned?

只是最後一項家事服務。您提到LoRa漏斗的82%在中國境外，這意味著漏斗中的18%是中國。就收入而言，為什麼會是目前的情況？

Revenues are closer to 45% to 50% of total revenues up from China, Tore. Obviously, I think in the last quarter, it's probably a little lower than that, but I think it’s still -- most of the -- a lot of the revenue is up from China. The funnel obviously takes time to transition into revenue. But the important point there is that we are seeing a lot of success outside China. Now, China also is still doing very well and LoRa is growing in China. And I think it will continue to grow in China. But there are other regions, particularly North America, has taken a while to catch up. But I think now if the funnel -- if we execute on the funnel transition to revenue, then we'll start to see a little bit more balanced geographical business for LoRa.

Tore 來自中國的收入接近總收入的 45% 至 50%。顯然，我認為上個季度的收入可能會略低於這個數字，但我認為大部分收入仍然來自中國。通路顯然需要時間才能轉變為收入。但重要的一點是，我們在中國以外看到了許多成功。現在，中國也仍然表現得很好，LoRa正在中國不斷發展。我認為它在中國將繼續增長。但其他地區，尤其是北美地區，需要一段時間才能趕上。但我認為現在如果我們將漏斗轉化為收入，那麼我們將開始看到 LoRa 的地理業務更加平衡。

Helpful.

有幫助。

And our next question comes from the line of Richard Schafer with Oppenheimer.

我們的下一個問題來自理查德·謝弗和奧本海默的對話。

Hi. This is [indiscernible] on the line for Rick. So in regards to your agreement to license to LoRa Cloud to AWS, I was wondering how this affects your end node forecast. And the long-term 40% CAGR, is this already embedded in -- can we see an accelerated growth in your 40% CAGR?

你好。這是 Rick 的[音訊不清楚]。因此，關於您向 AWS 授予 LoRa 雲端許可的協議，我想知道這對您的終端節點預測有何影響。長期 40% 的複合年增長率，是否已經嵌入——我們能否看到 40% 複合年增長率的加速成長？

Well, yes, it's kind of embedded in the 40% CAGR, I think, because it drives a lot of end use connectivity. The whole goal here is to use AWS' channel and market power and presence to go out and drive more end node connectivity and more assets that need to be tracked and managed and we feel pretty good about the combined company's efforts here and the thinking here and the platform, but certainly, that's the expectation. Obviously, it will drive in addition to Lora Edge end devices, it would drive cloud services revenues for us and that's significant.

嗯，是的，我認為它已經融入了 40% 的複合年增長率，因為它推動了許多最終用途的連接。這裡的整體目標是利用AWS 的管道、市場力量和影響力走出去，推動更多的終端節點連接以及更多需要追蹤和管理的資產，我們對合併後的公司在這裡所做的努力以及這裡的想法感到非常滿意。顯然，除了 Lora Edge 終端設備之外，它還將推動我們的雲端服務收入，這一點意義重大。

Great. My second question is on LoRa's spectrum. Is there any way you can help parse out how big LoRa is for the unlicensed sub-gigahertz spectrum? And how does this compare to the 2.4 gigahertz variety?

偉大的。我的第二個問題是關於 LoRa 的光譜。有什麼方法可以幫助您解析出 LoRa 對於未經許可的亞千兆赫頻譜有多大嗎？與 2.4 GHz 相比如何？

Majority of the revenues are sub-gig. The 2.4 gig is relatively new. So I would say, yes, 90% and above is probably sub-gigahertz at the moment, yes.

大部分收入都是次級收入。 2.4 gig 相對較新。所以我想說，是的，90% 及以上目前可能是亞千兆赫，是的。

And our next question comes from the line of Harsh Kumar with Piper Sandler.

我們的下一個問題來自 Harsh Kumar 和 Piper Sandler 的對話。

Yes. Hello, Mohan and Emeka, I've got a couple. Mohan, I'm looking at your commentary. You talked about -- both you and Emeka talked about signs of demand stabilization, but when I sort of square that against your commentary, I kind of concur that both industrial and infrastructure are down. So my question is, if you're seeing signs of stabilization, where are you seeing them? And do you think this is happening because of some of the new products that you guys are launching like Tri-Edge getting some traction and CopperEdge getting some traction? Or are you seeing sort of broadband or sort of broad-based sort of pickup in demand which suggests that maybe you're on your way up from here?

是的。你好，莫漢和埃梅卡，我有一對。莫漢，我正在看你的評論。你談到——你和埃梅卡都談到了需求穩定的跡象，但當我將這一點與你的評論進行比較時，我有點同意工業和基礎設施都在下降。所以我的問題是，如果你看到穩定的跡象，你在哪裡看到它們？您認為這種情況的發生是因為你們推出的一些新產品（例如 Tri-Edge 和 CopperEdge）受到了一些關注嗎？或者您看到某種寬頻或某種廣泛基礎的需求回升，這表明您可能正在從這裡開始前進？

Yes. I think obviously, Harsh, we guided down for Q4 and any bookings, POS demand stabilization is really going to impact the first half of next year, right? So as we start to look at it, I would say that the stabilization is more on the existing business, the existing business in China, looks like it's going to recover in the -- starting to recover in the first half. The existing consumer business, which has been down most of the good part of the year, looks like it's starting to bottom out here. So hopefully, Q1 maybe Q2 will start to see pickup there. Now you add on top of that some of the new growth engines and design wins I talked about, we're starting to feel pretty good about certainly the second half of next year from a growth standpoint. But to answer your question, the comment on the stabilization is more on the existing revenues today.

是的。我認為顯然，嚴厲的是，我們對第四季度和任何預訂的指導都下調了，POS 需求穩定確實會影響明年上半年，對嗎？因此，當我們開始審視它時，我想說，穩定更多地取決於現有業務，中國的現有業務，看起來將在上半年開始復甦。現有的消費者業務在今年大部分時間都在下滑，看起來似乎已經開始觸底。因此，希望第一季或第二季能夠開始出現回升。現在，除了我談到的一些新的成長引擎和設計勝利之外，從成長的角度來看，我們開始對明年下半年的情況感覺非常好。但要回答你的問題，對穩定的評論更多是針對今天的現有收入。

Understood. And then you talked about a couple of growth rates for LoRa. So I just want to understand. You talked about, Mohan, I think you said all-in all-out, you ended up with about a 39% growth rate to LoRa for this year, which I think is pretty respectable given your exposure to China and what's really happening in China. And then you talked about a number ex-China of 60% that I didn't catch. Maybe you could clarify that. And then how are you thinking about -- the real question is how are you thinking for growth for next year?

明白了。然後您談到了 LoRa 的幾個增長率。所以我只是想了解一下。 Mohan，你談到，我認為你說的是全力以赴，今年 LoRa 的增長率約為 39%，考慮到你對中國的了解以及中國實際發生的情況，我認為這是相當可觀的。然後你談到了60%的中國以外的數字，我沒有聽清楚。也許你可以澄清一下。然後你如何考慮——真正的問題是你如何考慮明年的成長？

Yes. So the 39% is our estimate for this year's growth. That's correct for LoRa-enabled business. The 60% now refers to end nodes and I simply commented on the fact that if you extract China, if you take out China where the growth has been a little bit slower, end nodes would have grown 60%. So end nodes are growing 60% in North America and Europe. And actually it's about 17% to 20% including China. So it's still pretty good, but I think it just shows that the acceleration in other regions is quite good.

是的。所以39%是我們對今年成長的估計。這對於支持 LoRa 的業務是正確的。 60%現在指的是終端節點，我只是評論這樣一個事實，如果你把中國去掉，如果你把增長慢一點的中國去掉，終端節點會增長60%。因此，北美和歐洲的終端節點成長了 60%。事實上，包括中國在內，這一比例約為 17% 至 20%。所以它仍然相當不錯，但我認為這只是表明其他地區的加速相當好。

Next year, a lot is going to depend on the second half. I mean, obviously China continues to be weak. And -- but we have some very good things going on like the Amazon announcement we just made, we think Sidewalk and some of that is -- some of those areas are starting to gain some momentum. We have a few headwinds, I mean, really what happened in the last couple of years with the Helium gateways is going to give us a little bit of a headwind for growth next year. But still, we haven't given up. We think next year should still be a reasonably good growth. It won't be close to the 40% CAGR, but I think if we can get some momentum on some of these other use cases, I think we'll still see good growth.

明年，很大程度取決於下半年。我的意思是，顯然中國仍然疲軟。而且 - 但我們正在發生一些非常好的事情，例如我們剛剛發布的亞馬遜公告，我們認為 Sidewalk 和其中一些 - 其中一些領域開始獲得一些動力。我的意思是，我們遇到了一些阻力，過去幾年 Helium 閘道發生的事情確實會為我們明年的成長帶來一些阻力。但我們仍然沒有放棄。我們認為明年應該仍然會有相當好的成長。它不會接近 40% 的複合年增長率，但我認為如果我們能夠在其他一些用例上獲得一些動力，我認為我們仍然會看到良好的成長。

And Mohan, very helpful. And if you don't mind, I'll ask another one and I promise I'll get off the line after this. I had a question on the deal. You've got a second request. So that changes the timing of the deal. I guess my question is, where do you think the timing of the deal will lie? And then for Emeka, $319 odd million raised, do you think that's enough to close the deal? And then were you looking at converts the entire time or were you looking at straight debt? And then given the interest rates sort of pivoted to convert and if these are converts, would you have an intent to buy these bonds back so they actually don't convert and dilute?

還有莫漢，非常有幫助。如果你不介意的話，我會再問一個，我保證在這之後我會掛斷電話。我對這筆交易有疑問。您還有第二個請求。因此這改變了交易的時間。我想我的問題是，您認為這筆交易的時間安排在哪裡？然後對於 Emeka，籌集了 3.19 億美元，您認為這足以完成交易嗎？然後你是一直在關注皈依者還是在關注直接債務？然後考慮到利率有點轉向轉換，如果這些債券是轉換的，你是否打算回購這些債券，這樣它們實際上就不會轉換和稀釋？

So let me start with the timing, Harsh, which is obviously out of our control to some extent. I can tell you what we're hoping, which is that towards the end of the year and early next year, we will be closed and we're ready to close and we're ready to move to integration. We're very well-prepared for that. We're excited about doing it. And so far, there's no indications that timeline shouldn't be achievable.

所以讓我從時機開始，很嚴酷，這在某種程度上顯然是我們無法控制的。我可以告訴你我們的希望，那就是在今年年底和明年初，我們將關閉，我們準備關閉，我們準備轉向整合。我們為此做好了充分的準備。我們對此感到很興奮。到目前為止，沒有跡象表明時間表不應該實現。

And so, Harsh, with regards to your question, we do have the financing that we need to close the transaction. We have a combination of our line of credit from our commercial banking partners. We have a term loan from our commercial banking partners and then we do have this convertible debt in addition to our internal cash. So the financing is pretty much in place for the acquisition. In terms of what we were looking at, we were looking at all the options. We were looking at everything and we were trying to -- we had to make the decision that we thought was best in terms of the cost of capital and things like that. With regards to being able to retire the debt, we just have to see how things play along here. So -- but we do have a lot of options on what we can do with regards to the convertible debt, but we'll make those decisions at the right time.

因此，哈什，關於你的問題，我們確實擁有完成交易所需的融資。我們擁有商業銀行合作夥伴的信用額度組合。我們從商業銀行合作夥伴那裡獲得了定期貸款，除了我們的內部現金之外，我們還有可轉換債務。因此，此次收購的融資已基本到位。就我們所關注的內容而言，我們正在考慮所有選項。我們正在考慮一切，我們正在努力——我們必須做出我們認為在資本成本等方面最好的決定。至於能否償還債務，我們只需要看看這裡的情況如何。所以，但對於可轉換債務，我們確實有很多選擇，但我們會在正確的時間做出這些決定。

And our next question comes from the line of Trevor Janoskie with Needham.

我們的下一個問題來自 Trevor Janoskie 和 Needham 的對話。

Yes. Hello. This is Trevor on for Quinn Bolton. So given your comments on demand stabilization, does this mean you see fiscal 4Q and fiscal 1Q '24 as the possible revenue trough with the step-up in the second half of '24?

是的。你好。我是奎因·博爾頓的特雷弗。因此，考慮到您對需求穩定的評論，這是否意味著您認為 24 年第四財季和第一財季可能是收入低谷，而 24 年下半年收入將增加？

That is the hope from what we see today. We certainly see the second half as being sequentially up from the first half. If you look at FY '23, we had a very strong first half. Looks like it's going to be a relatively weak second half, but as you see from our comments that we expect FY '23 to be a record year for us. So when you look at it as a total, it looks like a pretty good year.

這就是我們今天所看到的希望。我們當然認為下半場比上半場連續上升。如果你看看 23 財年，我們的上半年表現非常強勁。看起來下半年將相對疲軟，但正如您從我們的評論中看到的那樣，我們預計 23 財年將是創紀錄的一年。因此，從總體上看，今年看起來是相當不錯的一年。

Now, going into next year, we know the first half is going to be relatively weak. The question is, how strong is the second half going to be if it comes back and how it comes back. And the main drivers of the weakness have been China and consumer. There's some inventory build-up, I think, from the very strong first half. So as those bleed through and China comes back and consumer starts to strengthen a little bit, we could hopefully see a stronger second half next year.

現在，進入明年，我們知道上半年將相對疲軟。問題是，如果逆轉的話，下半場會有多強以及如何逆轉。疲軟的主要驅動因素是中國和消費者。我認為，由於上半年的強勁表現，庫存有所增加。因此，隨著這些因素的逐漸消失，中國的復甦以及消費者開始稍微走強，我們有望看到明年下半年的強勁表現。

Awesome. And you spoke about relative resilience in North America and the EU in broad industrial. Do you expect this resilience to continue moving forward? And is automotive playing a big role in this as well?

驚人的。您談到了北美和歐盟在廣泛工業領域的相對彈性。您預計這種韌性會繼續向前發展嗎？汽車在這方面也扮演重要角色嗎？

Well, automotive is one of the stronger segments today for sure and we expect it to continue to be. I would say, the other industrial markets in North America and Europe are holding up relatively well. It's all relative consumers. It's been extremely weak, particularly Asian consumer business. I guess, it's well-documented that China consumer and Samsung as an example have been very weak. And I would say that the broader consumer market and computing market, PCs, laptops, tablets is also very weak. And then China itself is definitely going through some challenges economically and through -- still through COVID issues. And so demand is weak. I don't anticipate those will remain, but for sure, at the moment, North America and Europe are stronger regions.

嗯，汽車無疑是當今最強大的細分市場之一，我們預計它將繼續如此。我想說，北美和歐洲的其他工業市場表現相對較好。都是相對的消費者。它非常疲弱，尤其是亞洲消費者業務。我想，有充分證據表明，中國消費者和三星的表現非常疲軟。我想說的是，更廣泛的消費市場和運算市場，個人電腦、筆記型電腦、平板電腦也非常疲軟。中國本身肯定正在經歷一些經濟挑戰，仍然是新冠問題。因此需求疲軟。我預計這些不會保留下來，但可以肯定的是，目前北美和歐洲是更強大的地區。

And our next question comes from the line of Craig Ellis with B. Riley Securities.

我們的下一個問題來自 B. Riley Securities 的 Craig Ellis。

Yes. Thanks for taking the question and appreciate all the transparency on what you're seeing in the markets and with the different products groups, guys. Mohan, I wanted to start just digging a bit deeper into China to understand what you're seeing there. You were early in flagging the weakness that started in China back in August.

是的。感謝您提出問題，並感謝您在市場和不同產品組中所看到的所有透明度，夥計們。莫漢，我想開始更深入地了解中國，以了解你在那裡看到的情況。您很早就指出了中國八月開始出現的疲軟狀況。

And in interpreting your comments, I'm trying to discern if the signs of stability that you may be seeing in consumer really related to Lunar New Year builds and therefore more of something that might be near-term oriented versus something that might be related to product cycles that would be up beyond that? So can you just go a little bit deeper into what's actually happening in China and the confidence that you have in consumer and elsewhere that we're near bottom there?

在解釋您的評論時，我試圖辨別您在消費者中看到的穩定跡像是否真的與農曆新年相關，因此更多的是可能與近期相關的東西，而不是可能與農曆新年有關的東西週期會超出這個範圍嗎？那麼，您能否更深入地了解中國實際發生的情況，以及您對消費者和其他地方的信心，認為我們已經接近底部了？

Yes. I think I would say the key thing to remember, Craig, is that it's come down significantly, right? So consumer and China across the board has come down quite significantly in Q3, comes down again in Q4. So we guide down in Q4. And so the indications are that Q1 will start to stabilize and we're seeing demand stabilization. So demand has started to level off. We're also seeing POS starting to improve and also bookings.

是的。克雷格，我想我要記住的關鍵一點是，它已經大幅下降，對嗎？因此，消費者和中國整體在第三季大幅下降，在第四季再次下降。所以我們在第四季進行指導。因此，有跡象表明第一季將開始穩定，我們看到需求穩定。因此需求已開始趨於平穩。我們也看到 POS 和預訂功能開始改進。

So I would say it's fairly broad. I wouldn't say it's one specific thing, but just remember that it's off a very low base rate. So the hope is now we'll start to see, I think, inventory consumed, I think that's the key. So POS increasing and some of the -- even our customers' inventory is starting to flow through over the next 2 quarters and then we'll start to see kind of more of a real demand/supply environment, I think, in the Q2, Q3 time frame hopefully.

所以我想說它相當廣泛。我不會說這是一件具體的事情，但請記住，它的基本利率非常低。因此，希望現在我們將開始看到庫存消耗，我認為這是關鍵。因此，POS 數量不斷增加，甚至我們客戶的庫存也將在接下來的兩個季度開始流動，然後我們將開始看到更多真實的需求/供應環境，我認為，在第二季度，希望第三季度的時間框架。

That's helpful. And then the second question is more of an intermediate term question. As you look out over the course of calendar '23, really fiscal '24 for the company, what businesses in the portfolio, do you have confidence that can grow year-on-year? We clearly have a challenging start given where we exit fiscal '23. But as you look ahead, it seems like LoRa would be set up for good growth. You talked about some real momentum in Tri-Edge. What are the businesses that you think are going to be year-on-year growers next year?

這很有幫助。第二個問題更多的是一個中期問題。當您回顧公司 23 年日曆（即真正的 24 財年）時，您對投資組合中的哪些業務能夠實現同比增長有信心嗎？考慮到我們 23 財年的退出情況，我們的開局顯然充滿挑戰。但展望未來，LoRa 似乎將迎來良好的成長。您談到了 Tri-Edge 的一些真正的動力。您認為明年哪些企業將實現年增？

Yes. So I do think for us the data center business is -- has a good chance of being a very strong grower next year, obviously second half driven, but we mentioned the significant wins actually we have in both Tri-Edge and FiberEdge in my script. And if you look at that, that second half can certainly drive growth in data center. On the wireless side, it's been fairly muted. So I think the question there is really more of a macro kind of comment on 5G base station deployments and some of the 4G stuff coming back. Again, China is a key player in that. But that could certainly grow.

是的。因此，我確實認為對我們來說，資料中心業務明年很有可能成為一個非常強勁的成長者，顯然是下半年推動的，但我們在我的腳本中提到了我們在Tri-Edge 和FiberEdge 方面實際上取得的重大勝利。如果你看一下這一點，下半年肯定會推動資料中心的成長。在無線方面，它相當安靜。因此，我認為問題實際上更多的是對 5G 基地台部署和一些 4G 相關內容的宏觀評論。中國再次是其中的關鍵參與者。但這肯定會成長。

Again, it's been very weak this fiscal year. So next year could be a strong [grower]. PON has had -- will have a record year in FY '23 for us. So not sure we'll see the same level of growth. So it will grow, but probably it will be a smaller, a lower grower -- low growth rate versus the other segments. And then the consumer is the big question because I think it's had such a poor fiscal year '23 that one has to believe that that has a good chance to come back in FY '24 and that includes our protection business and our proximity sensing business in Asia, particularly in Korea. And then of course, LoRa, as I mentioned, if you take out the Helium challenge that we have, the business should grow.

同樣，本財年的表現非常疲軟。所以明年可能會是個強勁的[種植者]。 PON 在 23 財年已經取得了創紀錄的成績。所以不確定我們會看到同樣水準的成長。所以它會成長，但可能會是一個規模較小、種植速度較低的企業——與其他細分市場相比，成長率較低。然後消費者是一個大問題，因為我認為它的 23 財年非常糟糕，以至於人們必須相信它有很好的機會在 24 財年捲土重來，其中包括我們的保護業務和接近感測業務亞洲，特別是韓國。當然，LoRa，正如我所提到的，如果你解決了我們面臨的氦氣挑戰，業務應該會成長。

And Craig, I also think our broad-based industrial and automotive protection, which is a record -- which is expected to have a record this year, should also grow next year. That is the anticipation.

克雷格，我還認為我們基礎廣泛的工業和汽車保護，這是一個創紀錄的——預計今年將創紀錄，明年也應該會成長。這就是期待。

Great. And then my last question is for you, Emeka. And it's just a follow-up to comments made 3 months ago around the capital costs, so really the debt interest cost for the [square] deal. I think 3 months ago, you were thinking 5% to 5.5% would be a reasonable blended interest cost. Is that still the expectation or has it changed?

偉大的。我的最後一個問題是問你的，艾梅卡。這只是三個月前圍繞資本成本發表的評論的後續，所以實際上是[平方]交易的債務利息成本。我認為 3 個月前，您認為 5% 至 5.5% 是合理的混合利息成本。這仍然是期望還是改變了？

I think it's going to move slightly because of all the increase in the rates at this point depending on where the rates are. At the time we close the transaction, I'll probably expect it to be between 5.5% and 6%.

我認為它會略有變化，因為此時利率的上漲取決於利率的位置。當我們完成交易時，我預計利率可能會在 5.5% 到 6% 之間。

Okay. So pretty close, but a little bit hard. Got it.

好的。非常接近，但有點困難。知道了。

And our next question comes from the line of Christopher Rolland with Susquehanna.

我們的下一個問題來自克里斯多福羅蘭與薩斯奎哈納的對話。

Hello, guys. Either of you guys, you know perhaps you can illustrate the weakness we're seeing in China, perhaps you can illustrate it for us. I think for the full year, you're expecting 34% of end consumption to be in China. I guess the first question is, what's a more normalized number? And then where do you think this trough in Q4? Are we talking like 20%? Is it less than that? How sort of deep is this? I guess that's my first question.

哈嘍，夥計們。你們中的任何一個人，也許你們可以說明我們在中國看到的弱點，也許你們可以為我們說明這一點。我認為全年終端消費的 34% 將來自中國。我想第一個問題是，什麼是更標準化的數字？那麼您認為第四季的低谷在哪裡？我們說的是 20% 嗎？是不是比這個還少？這到底有多深？我想這是我的第一個問題。

So with regards to the consumption by region, it is an estimate, right? We currently have a size that's 35% and it is still at that range. Maybe we'll just have to see how the POS and everything continues by the end of the year. But Chris, my gut feel at this time is that it is probably going to be at that level, maybe slightly lower, but I can't really give you a number at this point.

那麼對於分地區的消費來說，這是一個估計，對嗎？目前我們的尺寸是 35%，並且仍然在這個範圍內。也許我們只需要看看 POS 和一切在年底前的進展如何。但是克里斯，我目前的直覺是，它可能會達到這個水平，也許會稍微低一些，但目前我無法給你一個數字。

Okay. Maybe you can talk about -- I think you mentioned inventories in China. I don't know if that was for a specific product or not. But can you talk about that where you think inventories are? I know you've talked about demand weakness, but inventories, is that coming into play here as well? And the reason I mentioned that is April, I think, in -- the April quarter for you guys can go either way, up or down. If there is some inventory being chewed through here, do you think that would indicate perhaps a positive sequential into April?

好的。也許你可以談談——我想你提到了中國的庫存。我不知道這是否適用於特定產品。但您能談談您認為庫存在哪裡嗎？我知道您談到了需求疲軟，但是庫存也在這裡發揮了作用嗎？我之所以提到這是四月的原因，我認為，四月的季度對你們來說可以是任何一種方式，上升或下降。如果這裡有一些庫存正在消化，您認為這是否表明四月份可能會出現積極的連續變化？

Yes, I think so. I have to look at it by product group. For sure, in our infrastructure business and I'm just referring to China now. We had a very, very strong first half across all of our businesses. And I think particularly, PON has perhaps a little bit more inventory than the other segments. And that's reflected in a weaker Q4 expectation, I think. So yes, I would say, in China, it's infrastructure, data center, and PON mostly, a little bit of 4G wireless, I think, there. And then on the consumer side, again, that's both for protection and proximity sensing. Again, we had a pretty strong previous fiscal year.

是的，我想是的。我必須按產品組來查看它。當然，在我們的基礎設施業務中，我現在指的是中國。我們所有業務的上半年表現都非常非常強勁。我特別認為，PON 的庫存可能比其他細分市場多一點。我認為，這反映在第四季預期疲弱。所以，是的，我想說，在中國，主要是基礎設施、資料中心和 PON，我認為還有一點 4G 無線。然後在消費者方面，這又是為了保護和接近感測。同樣，我們上一財年的表現相當強勁。

And I think what we are seeing is that consumers have been fairly soft for the whole year, but particularly I would say in China and Korea. So those are the 2 main areas. On the LoRa front, there's -- obviously there's some excess inventories from the Helium drop-off there. But I think that will eventually be utilized. The Helium gateway chips are the same chips that can be used for other gateways. So I'm not so concerned there. It's just more of a macro softness kind of thing for China. So we'll see how that plays out.

我認為我們看到的是消費者全年都相當疲軟，尤其是在中國和韓國。這些是兩個主要領域。在 LoRa 方面，顯然有一些來自氦氣供應的過剩庫存。但我認為這最終會被利用。 Helium 閘道晶片與可用於其他閘道的晶片相同。所以我對此不太擔心。對中國來說，這更像是一種宏觀疲軟的情況。所以我們將看看結果如何。

Okay. And at this time, I'm not seeing any further questions. I would like to turn the floor back over to management for any closing remarks.

好的。目前，我沒有看到任何進一步的問題。我想將發言權交還給管理階層，讓他們發表結束語。

In closing, our global teams are executing well in a challenging economic environment. While we are facing more macroeconomic challenges in Q4, Semtech is a very resilient company and I am confident that with the solid progress of our exciting growth engines and the diversified nature of our business, we will successfully manage through the headwinds we currently faced and deliver yet another record year in FY '23. With that, we appreciate your continued support of Semtech and look forward to updating you all next quarter. Thank you.

最後，我們的全球團隊在充滿挑戰的經濟環境中表現良好。雖然我們在第四季度面臨更多宏觀經濟挑戰，但Semtech 是一家非常有彈性的公司，我相信，憑藉我們令人興奮的成長引擎的紮實進展和業務的多元化性質，我們將成功應對當前面臨的逆風並交付23 財年又創歷史新高。在此，我們感謝您對 Semtech 的持續支持，並期待在下個季度向您通報最新情況。謝謝。