Sensata Technologies Holding PLC (ST) 2019 Q3 法說會逐字稿

Good day, and welcome to the Sensata Technologies Q3 2019 Earnings Call. (Operator Instructions) Please note, this event is being recorded.

美好的一天，歡迎參加森薩塔科技 2019 年第三季財報電話會議。（操作員說明）請注意，正在記錄此事件。

I would like to turn the conference over to Mr. Joshua Young, Vice President, Investor Relations. Please go ahead.

我想將會議交給投資者關係副總裁 Joshua Young 先生主持。請繼續。

Thank you, Francesca, and good morning, everybody. I'd like to welcome you to Sensata's Third Quarter 2019 Earnings Conference Call. Joining me on today's call are Martha Sullivan, Sensata's CEO; Jeff Cote, Sensata's President and Chief Operating Officer; and Paul Vasington, Sensata's Chief Financial Officer. In addition to the earnings release we issued earlier today, we will be referencing a slide presentation during today's call. The PDF of this presentation can be downloaded from Sensata's Investor Relations website. We will post a replay of today's webcast shortly after the conclusion of today's call.

謝謝你，弗朗西斯卡，大家早安。歡迎您參加森薩塔 2019 年第三季財報電話會議。參加今天電話會議的還有森薩塔 (Sensata) 執行長瑪莎·沙利文 (Martha Sullivan)； Jeff Cote，森薩塔總裁兼營運長；和保羅‧瓦辛頓 (Paul Vasington)，森薩塔科技財務長。除了我們今天早些時候發布的收益報告外，我們還將在今天的電話會議上參考幻燈片演示。本簡報的 PDF 版本可從森薩塔的投資者關係網站下載。我們將在今天的電話會議結束後不久發布今天網路廣播的重播。

Before we begin, I'd like to reference Sensata's safe harbor statement on Slide #2. During the course of this conference call, we will make forward-looking statements regarding future events or the financial performance of the company that involve risks and uncertainties. The company's actual results may differ materially from the projections described in such statements. Factors that might cause such differences include, but are not limited to, those discussed in our Forms 10-Q and 10-K as well as other subsequent SEC filings.

在開始之前，我想參考幻燈片#2 上的森薩塔安全港聲明。在本次電話會議期間，我們將對涉及風險和不確定性的未來事件或公司財務表現做出前瞻性陳述。本公司的實際結果可能與此類聲明中所述的預測有重大差異。可能導致此類差異的因素包括但不限於我們的 10-Q 和 10-K 表格以及其他後續 SEC 文件中討論的因素。

On Slide #3, we show Sensata's GAAP results for the third quarter of 2019. We encourage you to review our GAAP financial statements in addition to today's presentation. Most of the subsequent information that we will discuss during today's call will be related to non-GAAP financial measures. Reconciliations of our GAAP to non-GAAP financial measures are included in our earnings release and in our webcast presentation. The company provides details of its segment operating income on Slides 15 and 16, which are the primary measures management uses to evaluate the business.

在幻燈片 #3 上，我們展示了森薩塔 2019 年第三季的 GAAP 業績。除了今天的演示之外，我們鼓勵您查看我們的 GAAP 財務報表。我們將在今天的電話會議中討論的大部分後續資訊將與非公認會計準則財務指標有關。我們的 GAAP 與非 GAAP 財務指標的調整包含在我們的收益發布和網路廣播簡報中。該公司在幻燈片 15 和 16 上提供了其部門營業收入的詳細信息，這是管理層用來評估業務的主要指標。

Martha will begin today's call with an overall business summary; and Jeff will then provide more details on our investments in our Smart & Connected initiative; and Paul will then cover our financials for the third quarter 2019 and provide guidance for the fourth quarter as well as update full year 2019 guidance. We will then take your questions after our prepared remarks.

瑪莎將以整體業務摘要開始今天的電話會議；然後，傑夫將提供有關我們對智慧互聯計劃的投資的更多詳細資訊；然後，Paul 將介紹我們 2019 年第三季的財務狀況，並提供第四季度的指導以及更新 2019 年全年指引。我們將在準備好發言後回答您的問題。

Now I'd like to turn the call over to Sensata's CEO, Martha Sullivan.

現在我想將電話轉給森薩塔的執行長瑪莎·沙利文 (Martha Sullivan)。

Thank you, Joshua, and thanks to everyone on the call for joining us this morning. We continued to effectively manage our operations in the third quarter and generated solid margins, EPS and free cash flow despite facing meaningful end market decline, particularly in our industrial and HVOR businesses as well as unfavorable movements in foreign currency.

謝謝約書亞，也感謝今天早上參加我們電話會議的所有人。儘管終端市場大幅下滑，特別是我們的工業和 HVOR 業務以及外匯不利變動，但我們在第三季度繼續有效管理我們的業務，並產生了穩健的利潤率、每股收益和自由現金流。

On Slide 4, I list some of the key highlights of the third quarter. For the third quarter, we reported revenues of $849.7 million, which represented an organic revenue decline of 2.8%. We adjusted -- we delivered adjusted EPS of $0.90, which was ahead of our guidance midpoint after accounting for unfavorable movement of foreign currency relative to our guidance.

在幻燈片 4 上，我列出了第三季的一些主要亮點。第三季度，我們報告營收為 8.497 億美元，有機收入下降 2.8%。我們進行了調整——調整後每股收益為 0.90 美元，在考慮到外匯相對於我們的指導的不利變動後，該數字高於我們的指導中點。

We continued to outgrow our end markets, posting outgrowth of 140 basis points in auto and 160 basis points in HVOR. While our level of outgrowth relative to end market production slowed from Q2 '19, much of this is related to launch delays from HVOR customers as they work to reduce their inventories in response to lower demand.

我們的成長持續超過終端市場，汽車領域成長了 140 個基點，HVOR 成長了 160 個基點。雖然我們相對於終端市場產量的成長水準自 19 年第二季以來有所放緩，但這很大程度上與 HVOR 客戶的發布延遲有關，因為他們努力減少庫存以應對需求下降。

We generated adjusted operating margins of 23.5% in the third quarter, which was 30 basis points higher than our guidance, despite generating approximately $9 million of lower-than-expected revenue. This reflects the operating discipline we have in the business. We are focused on quickly driving expense and productivity initiatives in order to align our costs with lower revenue.

儘管產生約 900 萬美元的收入低於預期，但我們第三季的調整後營業利潤率為 23.5%，比我們的指導高出 30 個基點。這反映了我們在業務中的營運紀律。我們專注於快速推動費用和生產力計劃，以使我們的成本與較低的收入保持一致。

Our adjusted EPS of $0.90 reflected a tailwind from foreign currency of $0.04, which was $0.03 lower than our expected tailwind of $0.07 to $0.08, primarily due to the weakening of the Chinese renminbi. After adjusting for this effect, our EPS was approximately $0.03 better than the midpoint of the guidance we provided for the third quarter of 2019.

我們調整後的每股收益為 0.90 美元，反映出 0.04 美元的外幣推動力，比我們預期的 0.07 美元至 0.08 美元的推動力低 0.03 美元，這主要是由於人民幣貶值。調整這種影響後，我們的每股收益比我們為 2019 年第三季提供的指導中位數高出約 0.03 美元。

We continue to make important long-term investments for our future growth. Jeff will talk later in the call about investments in our Smart & Connected initiative and how we believe this solution will bring significant value for commercial truck and trailer OEMs as well as fleet managers.

我們繼續為未來的成長進行重要的長期投資。傑夫稍後將在電話會議中討論對我們的智慧互聯計畫的投資，以及我們如何相信解決方案將為商用卡車和拖車原始設備製造商以及車隊經理帶來巨大價值。

Finally, our free cash flow grew 15% year-over-year, totaling $140 million, which was 97% of our adjusted net income in the quarter. This represented a significantly higher conversion rate than we have posted in recent quarters as a result of better working capital efficiency.

最後，我們的自由現金流年增 15%，總計 1.4 億美元，佔本季調整後淨利的 97%。由於營運資金效率提高，這表明轉換率比我們最近幾季公佈的要高得多。

Slide 4 shows organic revenue performance by end market in the third quarter. I will begin with auto, which posted an organic revenue decline of 40 basis points in the quarter. This was 140 basis points above an end market decline of 1.8% in the third quarter. For the full year 2019, we expect our automotive business to outgrow its end market by approximately 500 basis points.

幻燈片 4 顯示了第三季終端市場的有機收入表現。我將從汽車行業開始，該行業本季的有機收入下降了 40 個基點。這比第三季終端市場下降 1.8% 高出 140 個基點。2019 年全年，我們預計我們的汽車業務成長將超過終端市場約 500 個基點。

We generated solid organic revenue growth in our China auto business during the third quarter, which was a significant sequential improvement from the second quarter of 2019. Most of this improvement was driven by the China auto end market, which declined 5% in the quarter compared to a 20% decline last quarter. We continue to sustain robust double-digit content growth in China.

第三季度，我們的中國汽車業務實現了穩健的有機收入成長，較 2019 年第二季較上季顯著改善。這項改善大部分是由中國汽車終端市場推動的，本季下降了 5%，而上季下降了 20%。我們在中國持續保持兩位數的內容強勁成長。

Our North American auto business generated organic revenue growth in the quarter, but was adversely affected by the GM strike. We estimate that the GM strike represented a 1% revenue headwind for the auto business in Q3 and will be a 3% revenue headwind for our overall auto business in the fourth quarter. In Europe, we continued to be affected by a volatile end market, primarily as a result of a general market decline.

我們的北美汽車業務在本季度實現了有機收入成長，但受到通用汽車罷工的不利影響。我們估計，通用汽車罷工對第三季汽車業務的收入造成 1% 的阻力，並將對第四季度我們整個汽車業務的收入造成 3% 的阻力。在歐洲，我們持續受到終端市場波動的影響，這主要是由於市場整體下滑。

Next, our HVOR business posted an organic revenue decline of 6.2%, which was 160 basis points above a 7.8% end market decline during the third quarter. We experienced considerable end market declines for both the on- and off-road portions of the HVOR business. Large construction and ag customers announced multi-quarter efforts to reduce their inventories because of falling demand. We are seeing a similar trend of inventory reductions and weaker end market demand from our on-road customers in North America and Europe, while our China on-road business continues to post healthy growth as a result of strong content performance. A number of our off-road HVOR customers are pushing out planned product launches by as much as 9 to 12 months as they continue to work down their equipment inventories. These delays have lowered our overall level of outgrowth relative to end market production.

接下來，我們的 HVOR 業務的有機收入下降了 6.2%，比第三季終端市場下降 7.8% 高出 160 個基點。我們經歷了 HVOR 業務的公路和越野部分終端市場的大幅下滑。由於需求下降，大型建築和農業客戶宣布了多個季度的努力來減少庫存。我們看到北美和歐洲的公路客戶也出現了類似的庫存減少和終端市場需求疲軟的趨勢，而我們的中國公路業務由於內容表現強勁，繼續保持健康成長。我們的許多越野 HVOR 客戶將計劃的產品發佈時間推遲了 9 至 12 個月，因為他們繼續減少設備庫存。這些延誤降低了我們相對於終端市場產量的整體成長水準。

Finally, I turn to our aerospace, industrial and other end markets, which are served by our Sensing Solutions segment. For the third quarter of 2019, we posted a 6.3% organic revenue decline in this business as global industrial demand weakened. Weak PMI in all geographic regions is signaling continued demand contraction, and our customers are lowering inventory and slowing production. Our industrial performance in China is particularly weak as a result of global tariff and trade actions. Our HVAC end market continued to see declines, due in part to a slowdown in the production of refrigerated trucks. The strongest performance in Sensing Solutions continues to be our aerospace business, which is posting content growth on top of an expanding end market. We are poised to generate high single-digit organic growth in our aerospace business for the full year.

最後，我轉向我們的航空航太、工業和其他終端市場，這些市場由我們的感測解決方案部門提供服務。2019 年第三季度，由於全球工業需求疲軟，我們該業務的有機收入下降了 6.3%。所有地理區域的 PMI 疲軟都表明需求持續收縮，我們的客戶正在降低庫存並放緩生產。由於全球關稅和貿易行動，我們在中國的工業表現尤其疲軟。我們的暖通空調終端市場持續下滑，部分原因是冷藏車生產放緩。感測解決方案中表現最強勁的仍然是我們的航空航太業務，該業務在不斷擴大的終端市場的基礎上實現了內容成長。我們準備在全年航空航太業務中實現高單位數有機成長。

Turning to Slide 6. I show some of the specifics of our end market outlook for the fourth quarter of 2019 compared to our previous assumption. We expect our end markets to become incrementally weaker in the fourth quarter and we expect our customers to continue to lower their inventories through the end of the year. One of the primary drivers of this lower revenue outlook is the negative effect of the GM strike, which will reduce our North American auto performance. We expect the North American auto end market will be down 12% to 13% in the fourth quarter of 2019, primarily due to the effects of the GM strike. This is significantly weaker than the low single-digit decline we previously expected in North America auto. We are also lowering end market expectations for the European auto, HVOR and industrial end markets for the fourth quarter. As a result, we are forecasting $830 million of revenue in the fourth quarter, at the midpoint of our guidance, which is approximately $50 million less than what we previously expected. This lower outgrowth is largely driven by weaker market demand and unfavorable changes in foreign exchange.

轉向幻燈片 6。我們預計第四季度我們的終端市場將逐漸疲軟，我們預計我們的客戶將在年底前繼續降低庫存。收入前景下降的主要原因之一是通用汽車罷工的負面影響，這將降低我們北美汽車的表現。我們預計2019年第四季北美汽車終端市場將下降12%至13%，這主要是由於通用汽車罷工的影響。這明顯弱於我們先前預期的北美汽車產業的低個位數跌幅。我們也降低了第四季度歐洲汽車、HVOR 和工業終端市場的終端市場預期。因此，我們預計第四季度的營收為 8.3 億美元，處於我們指引的中點，比我們之前的預期少了約 5,000 萬美元。產出下降主要是因為市場需求疲軟和外匯不利變化所造成的。

Before turning the call over to Jeff, I want to close with a few key messages that I show on Slide 7. We have a long history of generating solid levels of margins, earnings and cash flows during many types of end market environments, including periods of more meaningful end market declines. And you saw the strong operating discipline reflected in our third quarter results as we quickly aligned our cost with customer demand to produce solid margin and EPS despite reporting lower-than-expected revenue.

在將電話轉交給Jeff 之前，我想以幻燈片7 中展示的幾條關鍵訊息作為結束語。和現金流水準。您可以看到我們第三季的業績反映出了嚴格的營運紀律，儘管我們報告的收入低於預期，但我們迅速將成本與客戶需求結合起來，以產生穩定的利潤和每股盈餘。

In the past 5 years, we experienced periods of difficult end market environments, but still managed to deliver a 5-year adjusted EPS CAGR of 8%. We've done a lot of work to strengthen our balance sheet over the past few years and our net leverage ratio of 2.8x is at the low end of our historic range, which should be reassuring for our investors. Our business model generates a lot of free cash flow, which gives us a much better cash flow profile than most of our peers serving the auto and industrial markets. So we are less susceptible to major swings in demand.

在過去的5年裡，我們經歷了終端市場環境困難的時期，但仍實現了5年調整後每股盈餘複合年增長率為8%。過去幾年，我們做了很多工作來加強我們的資產負債表，我們的淨槓桿率為 2.8 倍，處於歷史範圍的低端，這應該讓我們的投資者放心。我們的商業模式產生了大量的自由現金流，這使我們比大多數服務汽車和工業市場的同行擁有更好的現金流狀況。因此，我們不太容易受到需求大幅波動的影響。

I'd also point out that our stronger balance sheet has occurred even as we have deployed more than $900 million towards M&A and share repurchases over the past 18 months. We continue to have a balanced returns-driven approach to capital deployment. We continually evaluate opportunities to put capital to work in M&A, share repurchases and other investments alongside our focus to sustain a healthy leverage ratio. This is what enables us to accelerate our investments and initiatives such as Electrification and Smart & Connected in order to drive future growth.

我還想指出的是，儘管我們在過去 18 個月中投入了超過 9 億美元用於併購和股票回購，但我們的資產負債表仍然更加強勁。我們繼續採用平衡報酬驅動的資本配置方法。我們不斷評估將資本用於併購、股票回購和其他投資的機會，同時我們專注於維持健康的槓桿率。這使我們能夠加快電氣化和智慧互聯等投資和舉措，以推動未來的成長。

In the face of weakening end markets and other external pressures, our historically low net leverage ratio and higher pace of returning cash to shareholders speaks to the strength of our organization. This results from the effectiveness of our operating strategy to outgrow our end markets, to continually improve our operating performance, to invest in our future growth and to deliver sustained shareholder value.

面對終端市場疲軟和其他外部壓力，我們歷史上較低的淨槓桿率和向股東返還現金的更快速度證明了我們組織的實力。這是由於我們的經營策略的有效性，以超越我們的終端市場，不斷提高我們的經營業績，投資於我們的未來成長並提供持續的股東價值。

I'd like to now turn the call over to Jeff to talk more about our Smart & Connected initiative. Jeff?

我現在想將電話轉給傑夫，更多地討論我們的智慧互聯計劃。傑夫？

Thank you, Martha. It is a pleasure to join you today. I'm going to talk in detail about the investments we are making in our Smart & Connected initiative and the value this solution brings to our customers. We believe that this initiative is one of our most strategic growth investments and has the potential to establish a new customer segment for Sensata, while further strengthening our relationships with truck and trailer OEMs as well as Tier 1 system partners.

謝謝你，瑪莎。很高興今天能加入你們的行列。我將詳細討論我們在智慧互聯計劃中所做的投資以及該解決方案為我們的客戶帶來的價值。我們相信，這項措施是我們最具策略性的成長投資之一，有潛力為森薩塔建立新的客戶群，同時進一步加強我們與卡車和拖車 OEM 以及一級系統合作夥伴的關係。

On Slide 9, I show an overview of the broad portfolio of Sensata sensors that are deployed on trailers and on-road trucks today. We're a clear industry leader, providing sensors for everything from drivetrain and suspension systems to trailer and cabin comfort applications. We have a strong brand with blue chip customers and we have a track record of success.

在幻燈片 9 中，我概述了目前部署在拖車和公路卡車上的森薩塔感測器的廣泛產品組合。我們是明顯的行業領導者，為從傳動系統和懸吊系統到拖車和駕駛室舒適應用的各種感測器提供感測器。我們在藍籌客戶中擁有強大的品牌，並且擁有成功的記錄。

Since 2017, our HVOR business has averaged 11% organic growth while outgrowing its end markets by nearly 700 basis points.

自 2017 年以來，我們的 HVOR 業務平均有機成長 11%，同時超出終端市場近 700 個基點。

One of the areas where we have a leadership position is in wireless sensing, specifically around tire pressure monitoring. As legislation requires OEMs to include TPMS on new trucks and trailers, our OEM customers will be leveraging our capabilities to significantly expand the data they are capturing on their vehicles and trailers beyond just tire pressure, using our vehicle area network solution.

我們處於領先地位的領域之一是無線感測，特別是在輪胎壓力監測方面。由於立法要求原始設備製造商在新卡車和拖車上安裝TPMS，我們的原始設備製造商客戶將利用我們的能力，使用我們的車輛區域網路解決方案，顯著擴展他們在車輛和拖車上捕獲的數據，而不僅僅是輪胎壓力。

We quickly recognized that this type of solution could also bring tremendous value directly to fleet managers, a growing and less cyclical part of the overall logistics value chain. While we believe the total available market for our solution sold into truck and trailer OEMs today is around $1 billion, the potential market for fleet managers is nearly 6x larger. Today, there are almost 80 million commercial trucks and trailers in North America and Europe alone that could be retrofit with our solution.

我們很快就意識到，這種類型的解決方案還可以直接為車隊經理帶來巨大的價值，車隊經理是整個物流價值鏈中不斷成長且週期性較低的部分。雖然我們相信目前出售給卡車和拖車 OEM 的解決方案的總可用市場約為 10 億美元，但車隊管理人員的潛在市場幾乎是原來的 6 倍。如今，光在北美和歐洲就有近 8,000 萬輛商用卡車和拖車可以使用我們的解決方案進行改造。

While many fleet managers are currently using telematics solutions, they have a desire to capture valuable data that can only be delivered through high-performing sensors and embedded software algorithms in areas such as brakes, weight, wheel ends and other applications.

雖然許多車隊經理目前正在使用遠端資訊處理解決方案，但他們希望捕獲有價值的數據，這些數據只能透過高效能感測器和嵌入式軟體演算法在煞車、重量、輪端和其他應用等領域提供。

Consequently, our market and technology leadership in TPMS is creating an important new opportunity for us to broaden our value proposition and evolve into a more strategic data insight partner for both OEMs and fleet managers.

因此，我們在 TPMS 領域的市場和技術領先地位為我們創造了一個重要的新機會，以擴大我們的價值主張，並發展成為 OEM 和車隊經理更具策略性的數據洞察合作夥伴。

On Slide 10, I show the Sensata vehicle area network, which consists of high-performing sensors developed by Sensata and those provided by third parties. A wireless gateway device to collect and process the data and a high-bandwidth wireless truck-to-trailer link to ensure that data between the truck and the trailer is exchanged seamlessly. Sensata is uniquely positioned to deliver on this opportunity because we understand the sensors that generate the data as well as the vehicle applications and the productivity-enabling use cases.

在幻燈片 10 中，我展示了森薩塔車聯網，該網路由森薩塔開發的高效能感測器和第三方提供的感測器組成。用於收集和處理資料的無線網關設備以及高頻寬無線卡車到拖車鏈路，以確保卡車和拖車之間的資料無縫交換。森薩塔在提供這一機會方面擁有獨特的優勢，因為我們了解生成數據的傳感器以及車輛應用和提高生產力的用例。

The portfolio that we are developing for this market is generally categorized in 2 areas. One, mechanical condition and safety; and two, load and environmental monitoring. I show examples of sensor applications we are focused on for a trailer on the left-hand side of the slide and the prioritized sensor applications for a truck on the right-hand side of the slide. These sensor applications are brought together in the Sensata vehicle area network, which is a scalable platform that fuses data from various sensors to provide a one-stop shop for valuable vehicle and trailer information. This information ultimately leads to data insights that improves efficiency for all customers. Customers can choose to deploy the entire portfolio along with advanced embedded software features or elect to only deploy one of the applications. This makes it a highly customizable solution that can scale to customer-specific needs.

我們為這個市場開發的產品組合通常分為兩個領域。一、機械狀況及安全；二是負荷和環境監測。我在幻燈片左側展示了我們重點關注的拖車感測器應用範例，以及在幻燈片右側展示了卡車優先感測器應用範例。這些感測器應用程式匯集在森薩塔車輛區域網路中，該網路是一個可擴展的平台，融合了來自各種感測器的數據，為有價值的車輛和拖車資訊提供一站式服務。這些資訊最終會帶來數據洞察，從而提高所有客戶的效率。客戶可以選擇部署整個產品組合以及高級嵌入式軟體功能，也可以選擇僅部署其中一個應用程式。這使其成為一個高度可自訂的解決方案，可以根據客戶的特定需求進行擴展。

Each of the use cases has a compelling value proposition. For example, our weight sensors help fleet managers reduce scale fees, save driver yard and dock time and increase utilization. Our brake sensors decrease maintenance costs and roadside checks, to name a few of the benefits. These applications have a rapid and compelling payback for fleet managers.

每個用例都有一個令人信服的價值主張。例如，我們的重量感測器可協助車隊經理降低秤費、節省駕駛員堆場和碼頭時間並提高使用率。我們的煞車感知器可降低維護成本和路邊檢查，等等。這些應用程式可以為車隊管理者帶來快速且引人注目的回報。

We have already had a number of wins and proof points demonstrating the value of the solution, including the decision by a leading truck OEM to deploy our vehicle area network on all of their new trucks in North America. We have secured a multimillion dollar agreement with a leading trailer manufacturer to deploy our solution on their trailers in Europe. In the third quarter, we initiated engagements with many top U.S. fleet managers to evaluate our solution in live field tests.

我們已經取得了許多勝利和證明點，證明了該解決方案的價值，包括一家領先的卡車原始設備製造商決定在其北美的所有新卡車上部署我們的車輛區域網路。我們與一家領先的拖車製造商達成了數百萬美元的協議，在他們歐洲的拖車上部署我們的解決方案。第三季度，我們開始與許多美國頂級車隊經理合作，在現場現場測試中評估我們的解決方案。

And finally, we have significant pull from partners seeking to integrate with our solution. For example, we recently formed a partnership with Hendrickson, a leading suspension and axle manufacturer in the U.S., to power their wheel-end sensor using our vehicle area network. While it can take 3 to 4 years to see revenue once we close new opportunities with our typical OEM customers, we expect the time line to generate revenue with fleet customers will be much shorter, possibly as fast as 12 to 24 months from the time we close a new business win.

最後，我們從尋求與我們的解決方案整合的合作夥伴那裡獲得了巨大的吸引力。例如，我們最近與美國領先的懸吊和車軸製造商 Hendrickson 建立了合作夥伴關係，使用我們的車輛區域網路為其輪端感測器提供動力。雖然一旦我們與典型的OEM 客戶達成新的機會，可能需要3 到4 年才能看到收入，但我們預計為車隊客戶創造收入的時間會短得多，從我們開始的時間起可能最快12 到24 個月。

On Slide 11, I show how the Sensata vehicle area network will feed a telematics ecosystem that is hungry for valuable sensor data. While we have simplified this slide, there is a lot of complexity in the telematics ecosystem that is required to capture data off the truck and trailer to bring it to the cloud for analytics. We expect to be an important partner for both on-road telematics hardware and cloud service providers that offer fleet management software solutions. We will integrate our solution with their onboard devices in order to pull data off the vehicle and into the cloud to facilitate valuable insights for fleet managers.

在投影片 11 中，我展示了森薩塔車域網路如何為渴望有價值的感測器資料的遠端資訊處理生態系統提供支援。雖然我們簡化了這張幻燈片，但遠端資訊處理生態系統存在很大的複雜性，需要捕獲卡車和拖車的數據並將其傳輸到雲端進行分析。我們希望成為道路遠端資訊處理硬體和提供車隊管理軟體解決方案的雲端服務供應商的重要合作夥伴。我們將把我們的解決方案與他們的車載設備集成，以便將數據從車輛中提取到雲端，為車隊經理提供有價值的見解。

To ensure our offering is strong, we are investing to meet the requirements of OEMs and fleet managers. This investment began 2 years ago and we expect our spending to accelerate in the next 12 months. In 2020, we expect to double our investment on this initiative. This speaks to the tremendous potential that the initiative has to accelerate our long-term growth as well as unlock new opportunities in the broader logistics ecosystem.

為了確保我們的產品強大，我們正在投資以滿足原始設備製造商和車隊經理的要求。這項投資於 2 年前開始，我們預計未來 12 個月支出將加速。2020 年，我們預計對此計畫的投資將增加一倍。這說明該計劃具有加速我們長期成長並在更廣泛的物流生態系統中釋放新機會的巨大潛力。

On Slide 12, I depict how Sensata has evolved over the past 2 years and our aspiration to continue to evolve into a data insight partner for our OEM and fleet customers. This evolution has included moving from sensor design and development to onboard wireless systems such as TPMS, to an integrated vehicle area network solution. We are leveraging our differentiated position in sensor designs, our expertise in embedded and wireless systems, and our industry knowledge in analytics to broaden the value that we can bring to customers and move up the IoT stack. More to come on this very exciting opportunity in the coming quarters.

在投影片 12 中，我描述了森薩塔在過去兩年中的發展情況，以及我們繼續發展成為 OEM 和車隊客戶的數據洞察合作夥伴的願望。這項演進包括從感測器設計和開發轉向 TPMS 等車載無線系統，再到整合的車輛區域網路解決方案。我們正在利用我們在感測器設計方面的差異化地位、我們在嵌入式和無線系統方面的專業知識以及我們在分析方面的行業知識來擴大我們可以為客戶帶來的價值並提升物聯網堆疊的價值。在接下來的幾個季度裡，這個令人興奮的機會還會有更多。

I'd now like to turn the call over to Paul to review our third quarter results in more detail and to provide guidance for the fourth quarter and full year 2019. Paul?

我現在想將電話轉給 Paul，以更詳細地審查我們第三季的業績，並為 2019 年第四季和全年提供指導。保羅？

Thank you, Jeff. Key highlights for the third quarter, as shown on Slide 14, include: revenue of $849.7 million in the quarter, a decrease of 2.7% from the third quarter of 2018. Changes in foreign currency decreased revenues by 0.3%. The net effect of our valves divestiture and the acquisition of GIGAVAC increased revenues by 0.4% year-over-year. The net result was a 2.8% organic revenue decline in the quarter.

謝謝你，傑夫。如投影片 14 所示，第三季的主要亮點包括：該季度營收為 8.497 億美元，較 2018 年第三季下降 2.7%。外幣變動使收入減少 0.3%。我們的閥門剝離和收購 GIGAVAC 的淨效應使收入年增了 0.4%。最終結果是本季有機收入下降 2.8%。

Adjusted operating income was $199.5 million in the quarter, a decrease of 3.9% compared to the third quarter of 2018, due primarily to lower revenue, productivity headwinds partially due to new product launches, and the net effect of acquisition and divestitures, somewhat offset by favorable currency. Adjusted net income was $144.6 million in the quarter, a decrease of 6.1% compared to the third quarter of 2018. Adjusted EPS was $0.90 in the third quarter, a decrease of 1.1% compared to the prior year quarter.

本季調整後營業收入為1.995 億美元，較2018 年第三季下降3.9%，主要是由於收入下降、新產品推出造成的生產力不利因素以及收購和資產剝離的淨影響（部分被資產剝離所抵銷）所致。該季度調整後淨利潤為 1.446 億美元，較 2018 年第三季下降 6.1%。第三季調整後每股收益為 0.90 美元，比去年同期下降 1.1%。

Now I'd like to comment on the performance of our 2 business segments in the third quarter of 2019. I will start with Performance Sensing on Slide 15. Our Performance Sensing business reported revenues of $628.6 million for the third quarter, a decrease of 3.2% compared to the same quarter last year, reflecting both the negative impact from foreign currency of 0.3% and the net effect of acquisitions and divestitures, which reduced revenue by 1.2%. Excluding these factors, Performance Sensing reported an organic revenue decline of 1.7% relative to the prior year.

現在我想談談我們2019年第三季兩個業務部門的業績。我將從投影片 15 上的效能感知開始。我們的績效感測業務第三季營收為 6.286 億美元，比去年同期下降 3.2%，既反映了 0.3% 的外匯負面影響，也反映了收購和剝離的淨影響，導致收入減少1.2%。排除這些因素，Performance Sensing 的有機收入較前一年下降 1.7%。

Our automotive business reported an organic revenue decline of 0.4% in the third quarter, but outpaced the end market by 140 basis points. Organic revenue growth in China and North America was offset by an organic revenue decline in Europe. Our HVOR business reported an organic revenue decline of 6.2% in the third quarter, outpacing the end market by 160 basis points. End market decline, combined with lower content growth due to launch delays, drove most of the decline in HVOR revenues during the quarter.

我們的汽車業務第三季有機收入下降 0.4%，但比終端市場高出 140 個基點。中國和北美的有機收入成長被歐洲有機收入下降所抵消。我們的 HVOR 業務第三季有機收入下降 6.2%，比終端市場下降 160 個基點。終端市場下滑，加上發布延遲導致內容成長放緩，是本季 HVOR 收入下降的主要原因。

Performance Sensing operating income was $165.1 million, a decrease of 7.5% as compared to the prior year. Performance Sensing profit as a percentage of revenue was 26.3% in the third quarter, a decline of 120 basis points on the same quarter last year. The decline in segment operating income and margin was primarily driven by the decline in organic revenues, productivity headwinds, partially due to the effect of scaling new product launches, and the net impact of acquisitions and divestitures. This was somewhat offset by the positive effect of foreign currency.

Performance Sensing 營業收入為 1.651 億美元，較上年下降 7.5%。第三季Performance Sensing利潤佔營收的比例為26.3%，比去年同期下降120個基點。部門營業收入和利潤率的下降主要是由於有機收入下降、生產力不利因素造成的，部分原因是新產品發布規模的影響以及收購和剝離的淨影響。這在一定程度上被外匯的正面影響所抵消。

As shown on Slide 16, Sensing Solutions reported revenues of $221.1 million in the third quarter, a decrease of 1.3% as compared to the same quarter last year. On an organic basis, factoring in a negative impact from foreign currency of 0.6% and a positive contribution from the acquisition of GIGAVAC of 5.6%, we reported an organic revenue decline of 6.3%. The decline was driven by our industrial business as a result of lower end market demand and inventory reductions in major geographic regions. This was partially offset by organic revenue growth in our aerospace business as a result of content growth and a healthy end market.

如投影片 16 所示，Sensing Solutions 第三季營收為 2.211 億美元，比去年同期下降 1.3%。在有機基礎上，考慮到外幣 0.6% 的負面影響以及收購 GIGAVAC 5.6% 的正面貢獻，我們報告有機收入下降了 6.3%。這一下降是由我們的工業業務推動的，這是由於低端市場需求和主要地理區域的庫存減少所致。由於內容成長和健康的終端市場，我們的航空航太業務的有機收入成長部分抵消了這一成長。

Sensing Solutions operating income was $71 million in the third quarter, a decrease of 3.2% from the same quarter last year. The decline in operating income was primarily due to lower organic revenue, partially offset by the favorable impact of the acquisition of GIGAVAC. The decline in segment margin was primarily related to the dilutive impact of the GIGAVAC acquisition, where we are investing heavily in electrification.

感測解決方案第三季營業收入為7,100萬美元，較去年同季下降3.2%。營業收入下降主要是由於有機收入下降，但部分被收購 GIGAVAC 的有利影響所抵消。部門利潤率下降主要與收購 GIGAVAC 的稀釋影響有關，我們在電氣化領域大力投資。

Corporate and other costs, not included in segment operating income, were $47.6 million in the third quarter, roughly flat with the previous year. Excluding charges added back to our non-GAAP results, corporate and other costs were $34.2 million in the third quarter of 2019.

第三季的企業和其他成本（不包括在部門營業收入）為 4,760 萬美元，與去年基本持平。不包括計入非 GAAP 業績的費用，2019 年第三季的公司成本和其他成本為 3,420 萬美元。

Slide 17 shows Sensata's third quarter 2019 non-GAAP results. Adjusted gross profit declined 5.1% year-over-year to $303 million and gross margins declined 90 basis points to 35.7%. The decline in gross profit and margin were primarily due to lower organic revenues and productivity headwinds related to scaling new product launches, partially offset by foreign currency tailwinds.

幻燈片 17 顯示了森薩塔 2019 年第三季非 GAAP 業績。調整後毛利年減 5.1% 至 3.03 億美元，毛利率下降 90 個基點至 35.7%。毛利和利潤率的下降主要是由於有機收入下降以及與擴大新產品發布相關的生產力不利因素，但部分被外匯不利因素所抵消。

SG&A costs were $9.3 million favorable year-over-year due to lower variable compensation and selling costs as well as lower discretionary spending. As a result, adjusted operating income was down 3.9% compared to the prior year quarter.

由於可變薪酬和銷售成本以及可自由支配支出的降低，SG&A 成本同比有利 930 萬美元。因此，調整後營業收入與去年同期相比下降了 3.9%。

Our tax rate, shown on this slide as a percent of adjusted profit before tax, was down 40 basis points year-over-year. We expect our full year tax rate to be approximately 8.5% to 9%, consistent with our previous guidance of 9%. Finally, adjusted EPS was down $0.01 or 1.1% as compared to the third quarter of 2018, as the decline in operating income was mostly offset by the benefit of share repurchases.

我們的稅率（在這張投影片中顯示為調整後稅前利潤的百分比）年減了 40 個基點。我們預計全年稅率約為 8.5% 至 9%，與我們之前 9% 的指導一致。最後，調整後每股盈餘較 2018 年第三季下降 0.01 美元，即 1.1%，因為營業收入的下降大部分被股票回購的收益所抵銷。

On Slide 18, I show the progress we have made on strengthening our balance sheet over the past few years. Since the end of 2015, we have lowered our net debt by $744 million and reduced our leverage ratio from 4.6x to 2.8x.

在投影片 18 中，我展示了過去幾年我們在加強資產負債表方面的進展。自 2015 年底以來，我們已將淨債務降低了 7.44 億美元，並將槓桿率從 4.6 倍降至 2.8 倍。

During the quarter, we enhanced our capital structure by issuing a new 10-year $450 million bond and refinancing our term loan. We achieved several positive outcomes from these financing actions. First, we took advantage of favorable markets and secured a 4.375% coupon on our bond financing. This historically low 10-year rate in the high-yield market reflects the attractiveness of our business as well as the confidence that bondholders have in our long-term operating performance. In addition, we increased the percentage of our fixed rate debt from 72% to 86% of our total debt to further reduce interest rate volatility. Also, with this bond financing, we extended the duration of our debt portfolio. Finally, we reduced the total amount of our term loan and extended the maturity to 2026. As a result, we have no debt maturities before 2023.

本季度，我們透過發行 4.5 億美元的新 10 年期債券並對定期貸款進行再融資，增強了我們的資本結構。我們透過這些融資行動取得了一些積極成果。首先，我們利用有利的市場，獲得了4.375%的債券融資票面利率。高收益市場10年期利率處於歷史低位，反映了我們業務的吸引力以及債券持有人對我們長期經營業績的信心。此外，我們將固定利率債務佔總債務的比例從72%提高到86%，以進一步降低利率波動。此外，透過債券融資，我們延長了債務投資組合的期限。最後，我們減少了定期貸款總額，並將期限延長至 2026 年。因此，我們在 2023 年之前沒有債務到期。

On Slide 19, I show our financial guidance for the fourth quarter of 2019. Overall, we expect to report revenues between $818 million and $842 million, representing a reported revenue decline between 1% and 3%.

在投影片 19 上，我展示了我們 2019 年第四季的財務指引。總體而言，我們預計報告收入在 8.18 億美元至 8.42 億美元之間，報告收入將下降 1% 至 3%。

At the midpoint of our guidance, we expect that foreign currency will decrease revenues year-over-year by approximately $6 million in the fourth quarter of 2019. And the net effect of acquisitions and divestitures will increase net revenues by approximately $9 million.

在我們指引的中點，我們預計 2019 年第四季外幣營收將年減約 600 萬美元。收購和剝離的淨效應將使淨收入增加約 900 萬美元。

Excluding the impact of foreign currency and the net effect of acquisitions and divestitures, we expect to report an organic revenue decline of 1% to 4% in the fourth quarter. Our current bill rate is approximately 88% of the revenue guidance midpoint for the fourth quarter. We expect to report adjusted operating income between $186 million and $192 million.

排除外匯影響以及收購和剝離的淨影響，我們預計第四季度有機收入將下降 1% 至 4%。我們目前的帳單費率約為第四季收入指引中點的 88%。我們預計調整後的營業收入將在 1.86 億美元至 1.92 億美元之間。

On the bottom line, we expect to report adjusted net income between $135 million and $141 million, which would represent a decline of 12% at the midpoint of our guidance. We expect to report adjusted EPS between $0.85 and $0.89. This earnings performance is down sequentially from the third quarter of 2019, due primarily to lower revenues, mainly from weaker end markets, higher investment in new growth programs and the timing of employee compensation expenses.

總體而言，我們預計調整後淨利潤將在 1.35 億美元至 1.41 億美元之間，這意味著我們的指導中位數將下降 12%。我們預計調整後每股收益將在 0.85 美元至 0.89 美元之間。這一獲利表現較 2019 年第三季連續下降，主要是由於終端市場疲軟、新增長計劃投資增加以及員工薪酬支出的時間安排導致收入下降。

Now let me turn to our guidance for the full year 2019, as shown on Slide 20. Our updated guidance for full year 2019 now anticipates the lower end market outlook that we shared earlier with you on the call. As a result, we expect revenue between $3.422 billion to $3.446 billion for the full year 2019, representing a decline between 2% and 3%. We expect foreign currency to decrease revenues by approximately $29 million and the net effect of acquisitions and divestitures will reduce revenues by approximately $6 million.

現在讓我談談我們對 2019 年全年的指導，如幻燈片 20 所示。我們更新的 2019 年全年指引現在預測了我們先前在電話會議上與您分享的低端市場前景。因此，我們預計 2019 年全年營收將在 34.22 億美元至 34.46 億美元之間，下降 2% 至 3%。我們預計外幣收入將減少約 2,900 萬美元，收購和剝離的淨效應將減少收入約 600 萬美元。

Our organic revenue guide represents a decline of 1% to 2% for the full year. We expect adjusted operating income between $779 million and $785 million, which would represent a decline of approximately 6%. On the bottom line, we expect adjusted net income between $569 million and $575 million and adjusted earnings per share between $3.51 and $3.55 for the full year 2019, which represents a decline of 3% to 4%. We expect to generate free cash flow of approximately $430 million to $450 million. This free cash flow guidance assumes annual capital expenditure of approximately $160 million to $170 million for the full year 2019.

我們的有機收入指南顯示全年下降 1% 至 2%。我們預計調整後營業收入將在 7.79 億美元至 7.85 億美元之間，下降約 6%。總體而言，我們預計 2019 年全年調整後淨利潤將在 5.69 億美元至 5.75 億美元之間，調整後每股收益將在 3.51 美元至 3.55 美元之間，下降 3% 至 4%。我們預計將產生約 4.3 億至 4.5 億美元的自由現金流。這項自由現金流指引假設 2019 年全年的年度資本支出約為 1.6 億至 1.7 億美元。

Now I'd like to turn the call back over to Joshua.

現在我想把電話轉回約書亞。

Thank you very much. Francesca, please assemble the Q&A roster.

非常感謝。Francesca，請整理問答名單。

(Operator Instructions) The first question is from Jed Dorsheimer with Canaccord Genuity.

（操作員說明）第一個問題來自 Canaccord Genuity 的 Jed Dorsheimer。

I guess first one is for Martha and/or Jeff. I guess I'd like to dig into this new initiative to kind of migrate up the stack, if you will, and so my question is, of the personnel, what is the current headcount? And of that, what would you categorize as engineering resources? And of those engineering resources, what percent is software engineers?

我想第一個是給瑪莎和/或傑夫的。我想如果你願意的話，我想深入研究這項新舉措，以實現堆疊的向上遷移，所以我的問題是，在人員方面，目前的人數是多少？其中，您將什麼歸類為工程資源？在這些工程資源中，軟體工程師所佔的比例是多少？

Great. Good question. So there are some skills that we've been able to use from our core business, specifically around the expertise associated with wireless sensor design. So we have reused, if you will, or redeployed a number of those resources. Headcount wise, we're talking about 90 people today with the vast majority of them being engineering, but some very important critical resources in terms of marketing and sales given the new customer base that we're engaging with.

偉大的。好問題。因此，我們可以利用核心業務中的一些技能，特別是與無線感測器設計相關的專業知識。因此，如果您願意的話，我們已經重複使用或重新部署了其中一些資源。就員工人數而言，我們今天談論的是 90 名員工，其中絕大多數是工程人員，但考慮到我們正在接觸的新客戶群，在行銷和銷售方面也有一些非常重要的關鍵資源。

Got it. Two more questions, if I could, or one more and then a follow-up. The -- if we look at the aerospace as a proxy for the data being generated in whether it's autonomous or ADAS, whatever the level may be that you're targeting, for vehicles or heavy vehicle and off road, an airplane will generate basically I think a gigabyte going from Boston to San Francisco, but a car will generate, in a day, over a terabyte. So you had mentioned kind of moving that data and storing it in the cloud. What is your solution in terms of dealing with the massive amount of data that would be generated in terms of this IoT strategy?

知道了。如果可以的話，還有兩個問題，或是再問一個問題，然後再進行跟進。如果我們將航空航太視為自動駕駛或 ADAS 產生的資料的代理，無論您的目標等級是什麼，對於車輛或重型車輛和越野車，飛機基本上都會產生 I想像一下從波士頓到舊金山的1 GB 字節，但一輛汽車一天之內就會產生超過1 TB 的位元組。所以你提到了移動數據並將其儲存在雲端。對於處理物聯網策略中產生的大量數據，您的解決方案是什麼？

And then as a -- maybe for Martha. I was wondering if you could update on dollar content per vehicle as that was a major part of the strategy in auto, and you've always done a nice job of kind of breaking that down by region, with China kind of representing the growth engine for that. I'm wondering what's changed given the end market slowdown?

然後作為——也許是為了瑪莎。我想知道您是否可以更新每輛車的美元含量，因為這是汽車戰略的主要部分，而且您一直做得很好，按地區進行細分，其中中國代表了增長引擎為此。我想知道終端市場放緩有何變化？

Yes. I'll hit both of those. The -- this is a really interesting space that we're focused on as a foray into really more of a solutions-based offering for Sensata, including data. When you look at what that customer base really needs, the data intensity is [now] in the areas that you've talked about, like aero and automotive. It's really getting algorithmic insights on what's actually happening on those vehicles and in those trailers. So the infrastructure today, when you look at telematics providers and even some of the cloud platforms that are there, is really well scaled to be able to accept that data. The challenge is the level of insight and really coming from the vehicle is not what it needs to be to keep those fleet managers happy.

是的。這兩個我都會打。這是一個非常有趣的領域，我們專注於進軍森薩塔基於解決方案的產品，包括數據。當您了解客戶群真正需要什麼時，數據強度[現在]位於您所討論的領域，例如航空和汽車。它確實透過演算法洞察這些車輛和拖車上實際發生的情況。因此，當您查看遠端資訊處理提供者甚至其中的一些雲端平台時，當今的基礎架構確實可以很好地擴展以能夠接受該資料。挑戰在於洞察力的水平，而真正來自車輛的洞察力並不能讓車隊經理滿意。

Also, a little bit of a comment on the initiatives that we have. I'd say relative to content per vehicle, the progression has been quite good. As you know, we're moving rapidly on a small base in EV content, so continue to make good progress there. China continues to be the fastest content grower for us in auto, so we are well along our way of doubling that content over the past 3 years, Jed, so in really good shape there. Some of the parts of the market where we've seen content growth accelerate, GM happens to be one of those, our North America content at General Motors is quite strong. We're feeling that in the face of the strike right now. But that just ties to our clean initiatives that we have in auto as well, so we're continuing to make strong progress there.

另外，對我們所採取的舉措進行一些評論。我想說，相對於每輛車的內容，進展相當不錯。如您所知，我們在電動車內容方面正在小範圍內快速發展，因此請繼續在這方面取得良好進展。中國仍然是我們汽車領域內容成長最快的國家，所以我們在過去三年裡將內容成長了一倍，傑德，所以那裡的狀況非常好。我們看到內容成長加速的市場部分，通用汽車恰好是其中之一，我們在通用汽車的北美內容非常強大。面對罷工，我們現在就有這樣的感覺。但這與我們在汽車領域的清潔舉措有關，因此我們將繼續在這方面取得強勁進展。

The next question is from Wamsi Mohan with Bank of America.

下一個問題來自美國銀行的瓦姆西·莫漢 (Wamsi Mohan)。

In Q3, you reported revenues down 3% and adjusted operating income down 4% roughly, and your guide has revenue down 2%, but adjusted operating margin is down 10%. You might have mentioned that, Paul, a little bit about timing of comp, but I just wanted to ask you if you could address what is creating these worse incremental margins? And how much of that do you view as controllable that you can take actions on? And I have a follow-up.

在第三季度，您報告的收入下降了 3%，調整後的營業收入大致下降了 4%，您的指南的收入下降了 2%，但調整後的營業利潤率下降了 10%。保羅，你可能已經提到了一點關於補償時間的問題，但我只是想問你是否可以解決是什麼造成了這些更糟糕的增量利潤？您認為其中有多少是可控的，可以採取行動？我有一個後續行動。

I think it's all controllable, but the question is over what period of time? The biggest drop that we saw was GM, it was very abrupt. It's a significant drop. It's 3% of the automotive business, so it's significant, and so the volume drop is which is driving most of the margin degradation and we're starting to align our costs. We have been aligning our cost to the lower demand profile. But it doesn't happen instantaneously, and so we're working that very quickly and we have confidence in our ability to get our margins back up as we exit Q4 into 2020.

我認為一切都是可控的，但問題是在什麼時間內？我們看到最大的跌幅是通用汽車，跌幅非常突然。這是一個顯著的下降。它佔汽車業務的 3%，所以意義重大，銷售下降是導致利潤率下降的主要原因，我們開始調整成本。我們一直在根據較低的需求情況調整成本。但這不會立即發生，因此我們的工作速度非常快，我們對在 2020 年第四季結束時恢復利潤率的能力充滿信心。

And Wamsi, one other comment there. We're spending some time profiling an area where we're accelerating investments and that's a phenomena as we move sequentially as well. So the GM phenomena is ugly, but it's compressed and it's a one shot. And we're not taking our eyes off of really important growth initiatives. So that's having some impact as we move sequentially as well.

還有 Wamsi，另一位評論者。我們正在花一些時間來分析我們正在加速投資的領域，這也是我們按順序採取行動時出現的現象。因此，通用汽車現像是醜陋的，但它是壓縮的，而且是一次性的。我們並沒有把目光從真正重要的成長舉措上移開。因此，當我們按順序進行時，這也會產生一些影響。

Okay. And if I could, as the street updates models here, would you say that the exit rate for 4Q is a good base to assume for modeling 2020? Seems like 4Q has some onetime negatives like GM that we just spoke about. So how should we think about seasonality, particularly into 1Q?

好的。如果我可以的話，隨著街道在這裡更新模型，您是否會說第 4 季的退出率是 2020 年建模的良好假設基礎？似乎第四季有一些一次性的負面影響，就像我們剛才談到的通用汽車一樣。那我們該如何考慮季節性，特別是第一季的季節性？

Yes. The same would -- I'm...

是的。同樣的——我...

Yes. The seasonality is going to be the same as you -- typically Q1 is our lowest margin profile. So I would expect the seasonality or the profile for '20 to be similar to what you saw in 2019. Other than that, I would say Q4 2020, we would expect to be better just given the comments we just made about the abrupt drop out of volume this quarter.

是的。季節性將與您相同 - 通常第一季是我們的最低利潤率。因此，我預計 20 年的季節性或概況與您在 2019 年看到的類似。除此之外，我想說的是，考慮到我們剛剛對本季銷量突然下降發表的評論，我們預計 2020 年第四季會更好。

Yes. So to answer your question directly, no, we would not view the margin performance in the fourth quarter as sort of a reset baseline on Sensata. So we're seeing sequential movements on operating profit of 70 basis points down. That's not our normal profile as we move sequentially. So we would expect to -- as we go -- as we get through the fourth quarter and certainly as we enter into the early days of 2020.

是的。因此，直接回答您的問題，不，我們不會將第四季度的利潤表現視為森薩塔的重置基準。因此，我們看到營業利潤連續下降 70 個基點。當我們按順序移動時，這不是我們的正常情況。因此，隨著我們的進展，我們預計，隨著第四季度的到來，當然還有進入 2020 年初的時候。

The next question is from Deepa Raghavan with Wells Fargo Securities.

下一個問題來自富國銀行證券公司的 Deepa Raghavan。

Martha, Paul, just tagging on that -- and Jeff too, sorry, tagging on that margin questions, strong margin, like you pointed out, Martha. This is a broader question, doesn't include GM et cetera, but more broader outlooks into 2020. Can you talk about how we should be thinking about leverage on contribution margin for Sensata in this downcast scenario, given that initial outlooks for 2020 for auto peers are coming in worse than feared. Can you talk about some of the cost actions you might have taken or are considering?

瑪莎、保羅，只是強調這一點——傑夫也是，抱歉，強調利潤率問題，強勁的利潤率，就像你指出的那樣，瑪莎。這是一個更廣泛的問題，不包括通用汽車等，但涉及 2020 年更廣泛的前景。鑑於汽車同行 2020 年的初步前景比預期更糟糕，您能否談談在這種悲觀的情況下我們應該如何考慮森薩塔邊際收益的槓桿作用。您能談談您可能已經採取或正在考慮的一些成本行動嗎？

Yes. We've already taken a number of actions. I'm going to let Paul elaborate a bit more. But we really focus in on making sure we maintain our high-differentiated margins and would expect to do that even in a decrementally down market. Now if we get into something that's extreme, it can have an impact. But we've seen an awful lot of market movement down and you can see how we're doing in the third quarter. So putting the GM strike aside, we've done a really good job of protecting our margins, and we've done that through some cost actions that we took earlier in the year. And Paul, I think you can say more.

是的。我們已經採取了一些行動。我會讓保羅詳細說明一下。但我們真正專注於確保維持高差異化的利潤率，並且希望即使在市場逐漸下滑的情況下也能做到這一點。現在，如果我們遇到一些極端的事情，它就會產生影響。但我們看到市場大幅下跌，您可以看到我們在第三季的表現。因此，撇開通用汽車的罷工不談，我們在保護利潤方面做得非常好，並且我們透過今年早些時候採取的一些成本行動做到了這一點。保羅，我想你可以說更多。

Yes. So we -- as we mentioned in the last call, we've done a lot of restructuring in Q2. There was more restructuring in Q3. We continue to work to align our cost structure to the lower demand and really focusing on fixed cost reduction and allowing the variable cost to come down as the volumes come down in our natural discipline of managing the P&L and managing our cost structure.

是的。因此，正如我們在上次電話會議中提到的，我們在第二季度進行了大量重組。第三季有更多重組。我們繼續努力使我們的成本結構適應較低的需求，並真正專注於固定成本的降低，並隨著我們管理損益和成本結構的自然規律的減少，允許可變成本下降。

Okay. So do these costs come back once GM -- I mean like -- GM's, I mean right now...

好的。那麼，一旦通用汽車——我的意思是——通用汽車，我的意思是現在……這些成本會回來嗎？

No.

不。

Okay. So they don't, okay. The structural strategy...

好的。所以他們不這樣做，好吧。結構策略...

Yes. The fixed cost is not going to come back. I mean clearly, when volumes pick up, we're going to need to support that volume, but in terms of fixed cost, those fixed costs are expected to -- majority of those to go away permanently.

是的。固定成本不會回來。我的意思很明顯，當銷量增加時，我們將需要支援該銷量，但就固定成本而言，這些固定成本預計將 - 其中大部分將永久消失。

Got it. Perfect. And my follow-up...

知道了。完美的。還有我的後續...

But as Martha mentioned, we are continuing to talk -- to invest in these new growth programs, and so that will be an offsetting impact.

但正如瑪莎所提到的，我們正在繼續討論投資這些新的成長計劃，因此這將產生抵消影響。

Got it. That's clear. My follow-up...

知道了。很清楚。我的後續...

The next question is from David Kelley with Jefferies.

下一個問題來自傑弗里斯的大衛凱利。

This is [Gavin] on for David. Looking at Slide 5, you noted that auto outgrowth is expected to improve in Q4. Can you talk about some of the drivers there? Is that region-specific or product-specific? And then I just have a quick follow-up.

這是大衛的[加文]。查看投影片 5，您注意到汽車產量預計將在第四季度有所改善。您能談談那裡的一些司機嗎？這是特定於地區的還是特定於產品的？然後我就進行快速跟進。

Yes. There are a number of drivers. And just keep in mind, we have pretty good visibility on to content growth despite the volatility in the end market. So we do have launches that are underway. So new content actually coming on vehicles despite things like the GM strike. China continues to be a very strong content performer for us. So you saw in Q3, we actually delivered organic growth in China despite a down market of about 6%, so delivering strong double-digit content growth. And that will be what continues to drive an overall performance of about 500 basis points.

是的。司機有好幾個。請記住，儘管終端市場存在波動，但我們對內容成長有充分的了解。所以我們確實正在進行一些發布。因此，儘管發生了通用汽車罷工等事件，新內容實際上還是出現在車輛上。對我們來說，中國仍然是一個非常強大的內容執行者。所以你在第三季看到，儘管市場下滑約 6%，但我們實際上在中國實現了有機成長，因此實現了強勁的兩位數內容成長。這將繼續推動整體表現上漲約 500 個基點。

Great. And then that content outgrowth, that content growth in China, can you just go into more detail there, too, please?

偉大的。然後是內容的成長，中國內容的成長，可以詳細介紹一下嗎？

Yes. There are a number of things driving that growth. So one of the big ones is that we are fulfilling a requirement -- helping our customers fulfill a requirement around National VI standards. You can think of these as being analogous to Euro 6 emission standards. That's driving more sensors in simple passenger cars and also on-road trucks. So some great content there. We're seeing now the mandate around tire pressure sensing play out and that's given us nice share gains in China and additional content, and then we're just continuing to see kind of a modernization of the fleet in China. So things like sensors and climate control systems are adding content growth for us. The use of oil pressure sensors, which are pretty highly installed in mature markets, are continuing to grow in China. So some of the puts and takes.

是的。有很多因素推動了這種成長。因此，最重要的事情之一是我們正在滿足一項要求——幫助我們的客戶滿足國六標準的要求。您可以將這些視為類似於歐盟 6 排放標準。這使得簡單乘用車和公路卡車中的感測器越來越多。那裡有一些很棒的內容。我們現在看到圍繞輪胎壓力感測的任務正在發揮作用，這給我們帶來了在中國的良好份額收益和更多內容，然後我們將繼續看到中國車隊的現代化。因此，感測器和氣候控制系統之類的東西正在為我們增加內容的成長。油壓感知器在成熟市場的安裝量相當高，在中國的使用量持續成長。所以一些投入和採取。

The next question is from Dan Galves from Wolfe Research.

下一個問題來自沃爾夫研究中心的丹‧加爾維斯。

Just wondering if there's anything to report on bidding activity or new business wins on electrification? And maybe more broadly, as we expect hybrid vehicles to be a big part of OEM strategies to meet CO2 targets, particularly in Europe, can you talk a little bit about your content opportunities on hybrid vehicles?

只是想知道是否有任何有關電氣化招標活動或新業務獲勝的報告？也許更廣泛地說，我們預計混合動力車將成為 OEM 策略的重要組成部分，以實現二氧化碳目標，特別是在歐洲，您能談談您在混合動力汽車上的內容機會嗎？

Yes. So let me address the question on hybrid first. We've always talked about the fact that we really like a hybrid solution because it has both powertrains available on it and we can provide content into it.

是的。所以讓我先解決混合動力的問題。我們一直在談論這樣一個事實：我們真的很喜歡混合動力解決方案，因為它具有可用的動力系統，並且我們可以向其中提供內容。

With regard to the progress on the electrified platforms, we continue to see a very strong pipeline of opportunity. The acquisition of GIGAVAC has really been validated in terms of the innovation that we believe that their products bring to the market, and that's been really confirmed from our engagement with customers and as well as the broader investment case that we underwrote on that investment to help propel us from an M&A standpoint.

關於電氣化平台的進展，我們繼續看到大量的機會。收購 GIGAVAC 確實在創新方面得到了驗證，我們相信他們的產品為市場帶來了創新，這一點從我們與客戶的接觸以及我們為幫助該投資承保的更廣泛的投資案例中得到了真正的證實。從併購的角度推動我們。

But we talked last quarter about the number of different initiatives, product design that we're developing, both organically and through acquisition on the electrification front and feel -- continue to feel very good about our positioning in terms of serving customers on that -- in that area.

但我們上個季度談到了我們正在開發的不同舉措和產品設計的數量，無論是有機的還是透過電氣化領域的收購和感覺——繼續對我們在服務客戶方面的定位感到非常滿意——在那個地區。

It's a pretty competitive market right now. So just in terms of any customer announcements, we're always a little bit sensitive to talk about where we're winning business because it's in sort of -- there is intense competition to get new platforms into the marketplace and we're enjoying those engagements.

現在這是一個競爭相當激烈的市場。因此，就任何客戶公告而言，我們總是對談論我們在哪裡贏得業務有點敏感，因為它在某種程度上 - 將新平台推向市場的競爭非常激烈，而我們很享受這些訂婚。

Okay. Great. And Paul, if you could -- you mentioned some productivity headwinds in the quarter from launches. You talked about continued investment in R&D out into 2020. And you also talked about kind of fixed cost reductions. If you kind of put those 3 things together as we look forward, do you expect costs to be lower on a year-over-year basis next year, kind of taking out the effect of kind of just general variable cost movements based on production?

好的。偉大的。保羅，如果可以的話，您提到了本季產品發布帶來的一些生產力阻力。您談到了 2020 年持續投資研發的問題。您還談到了固定成本的削減。如果您將這三件事放在一起，正如我們所期望的那樣，您是否預計明年的成本會同比下降，從而消除基於產量的一般可變成本變動的影響？

So as we look at 2020, and so we're still going through that process planning for next year just at a high level, the scaling of new products were largely behind us. What is impacting this year is the decline in a lot of our higher-margin mature products and the scaling up of these new products, which is more costly. So as those new product start to become more mature, the margin profile will improve. So the margins next year, I expect to be better as it relates to that. With the fixed cost reduction, we'll continue to drive out cost and try to align to the demand that we're seeing. We're going to continue to look, as Jeff mentioned, about increasing our investment in Smart & Connected. It's a very, very important issue for us. So too early to call to margin profile, but I would expect everything to improve, the cost to be lower relative to demand as we go into '20 and through '20.

因此，當我們展望 2020 年時，我們仍在高水準上進行明年的流程規劃，新產品的擴展基本上已經過去了。今年的影響是我們許多利潤率較高的成熟產品的下降以及這些成本更高的新產品的擴大。因此，隨著這些新產品開始變得更加成熟，利潤率將會改善。因此，我預計明年的利潤率會更好，因為這與此相關。隨著固定成本的降低，我們將繼續降低成本並努力滿足我們所看到的需求。正如傑夫所提到的，我們將繼續考慮增加對智慧和互聯的投資。這對我們來說是一個非常非常重要的問題。所以現在談論利潤率還為時過早，但我預計一切都會改善，隨著我們進入 20 世紀和 20 世紀，成本相對於需求會更低。

And it will follow that demand profile that we see from our customers. So that's the -- where the heavy lifting is being done right now to better understand the overall demand profile and what that translates to in terms of a 2020 outlook, and we'll do the work to make sure that our cost structure is aligned to that.

它將遵循我們從客戶那裡看到的需求概況。因此，這就是現在正在做的繁重工作，以更好地了解整體需求狀況以及這對 2020 年前景的影響，我們將努力確保我們的成本結構與那。

(Operator Instructions) The next question is from Amit Daryanani with Evercore.

（操作員說明）下一個問題來自 Evercore 的 Amit Daryanani。

I have two questions as well. First one, Martha, on the HVOR softness, and you talked about lower customer forecast and inventory reductions as well. From your experience, how long do these corrections typically last in the HVOR market? How many quarters does that issue typically persist? And then from a content perspective, do you see your content on the HVOR side remaining stable or accelerating over the next few quarters?

我也有兩個問題。第一個，瑪莎，關於 HVOR 的疲軟，您還談到了較低的客戶預測和庫存減少。根據您的經驗，HVOR 市場的這些調整通常會持續多久？該問題通常持續數季？然後從內容的角度來看，您認為 HVOR 方面的內容在接下來的幾季保持穩定還是加速？

Yes. It's early innings on the market correction when we look across those end market segments. And we went back and looked at things like 2015 where we saw an overall correction. Given that, it ranges from about 4 to 6 quarters. The time of intensity has never been the same throughout every cycle, so some start very intensely, and other sort of build momentum. So not sure I can provide a lot of visibility on that -- what that can look like.

是的。當我們審視這些終端細分市場時，現在正處於市場調整的早期階段。我們回顧了 2015 年的情況，看到了整體調整。有鑑於此，其範圍約為 4 至 6 個季度。每個週期的強度時間從來都不相同，因此有些開始時非常激烈，而有些則是建立動力。所以不確定我能否提供很多關於這一點的可見性——那會是什麼樣子。

The thing that's impacting content growth now, and we think stabilizes as the correction gets underway, is that you're seeing delays in new equipment coming into the market as these customers are trying to actually consume older equipment that has less of the content. So as those inventories come down, we would expect to see content restored, and at the same time, we have growth programs that we would expect to see improve the overall equipment take rate.

現在影響內容成長的因素（我們認為隨著調整的進行而穩定下來）是，您會看到新設備進入市場的延遲，因為這些客戶正在嘗試實際消費內容較少的舊設備。因此，隨著這些庫存的下降，我們預計內容將會恢復，同時，我們也有成長計劃，預計會提高整體設備的使用率。

Got it. That's really helpful. And if I could just follow up with Paul. Paul, the free cash flow conversion was fairly impressive, I think high 90% in Q3. My math suggests it remains high, in the high 90% again in Q4 as well. Hopefully that's right.

知道了。這真的很有幫助。如果我能跟進保羅就好了。Paul，自由現金流轉換相當令人印象深刻，我認為第三季高達 90%。我的數學表明它仍然很高，第四季也再次達到 90% 的高水平。希望這是對的。

That's right.

這是正確的。

I'm wondering is this something onetime in nature that's helping this high free cash flow conversion in the back half. Or is this something structural that we should start to think about as we model longer term numbers in free cash flow for you guys?

我想知道這是否是某種一次性的東西，有助於後半部分的高自由現金流轉換。或者說，當我們為你們建立自由現金流的長期數字模型時，我們應該開始考慮這個結構性問題嗎？

If you saw, last year, it was similar -- kind of similar where the second half had stronger cash flow conversion than the first half. But what we're seeing is very strong execution around reducing past dues on the receivables. Past dues had very good collections in Q3. We continue to work our inventory to streamline our inventory -- work our inventory levels down, improve our terms and conditions of the suppliers. So driving better working capital efficiency is a process improvement initiative we've had for a while, and you're seeing the results of that. But the seasonality is relatively the same where the second half is typically stronger in terms of conversion.

如果你看到，去年的情況是相似的——有點相似，下半年的現金流轉換比上半年更強。但我們看到的是在減少應收帳款逾期欠款方面執行力非常強。第三季的逾期款項收款情況非常好。我們繼續管理我們的庫存，以精簡我們的庫存——降低我們的庫存水平，改善我們的供應商條款和條件。因此，提高營運資金效率是我們已經實施了一段時間的流程改善舉措，您已經看到了其結果。但季節性相對相同，下半年的轉換率通常更強。

Next question is Samik Chatterjee with JPMorgan.

下一個問題是摩根大通的 Samik Chatterjee。

This is Bharat on for Samik. So my first question relates to the aerospace end market. And can you give us a sense of what trends are you seeing in end market? You have been reporting very strong organic growth numbers there. So how sustainable is the trend as we particularly move into 2020? Is it more a function of favorable end market in general or more content growth for Sensata? And just as a quick follow-up, can you also give us an update of how much restructuring remains to be undertaken in the fourth quarter?

這是巴拉特 (Bharat) 代表薩米克 (Samik) 發言。我的第一個問題與航空航太終端市場有關。能為我們介紹一下您在終端市場看到的趨勢嗎？你們在那裡報告了非常強勁的有機成長數字。那麼，隨著我們進入 2020 年，這趨勢的可持續性如何？對森薩塔來說，這更多的是有利的終端市場還是更多的內容成長？作為快速跟進，您能否向我們介紹第四季度仍有多少重組工作的最新情況？

So why don't I hit the aerospace one and then Paul can hit the second part of the question. So aerospace is one of these end markets that has the luxury of a very long lead time around the booked business. And so I suspect that many of you are tracking the aerospace industry in the 8- to 10-year backlog of orders that are out there. So that provides for some very, very long visibility into the revenue stream that we would have associated with that. We also have similar pipeline around content growth for new products that we're launching into that space that we have high visibility to as well. So the combination of the very long cycle and the visibility gives us a pretty good look. We track a number of metrics, cancellation of orders, which there has been some, but not anything that would cause anybody to be alarmed regarding that backlog of business, and we also watch things like passenger miles and so forth to really gauge the health of the overall industry. And we're seeing that be -- continue to be quite resilient despite some of the challenges associated with grounded aircraft and so forth.

那為什麼我不先解決航空航天問題，然後保羅就可以解決問題的第二部分。因此，航空航太是這些終端市場之一，它在預訂業務方面擁有很長的交貨時間。因此，我懷疑你們中的許多人都在追蹤航空航太業 8 到 10 年積壓的訂單。因此，這為我們提供了與之相關的收入流的非常非常長的可見性。我們在新產品的內容成長方面也有類似的管道，我們正在將這些新產品推出到我們也具有很高知名度的領域。因此，非常長的周期和可見度的結合給我們帶來了非常好的外觀。我們追蹤了一些指標，取消訂單，雖然有一些指標，但不會導致任何人對業務積壓感到震驚，我們還觀察乘客里程等數據，以真正衡量業務的健康狀況整個行業。我們看到，儘管存在與飛機停飛等相關的一些挑戰，但仍具有相當的彈性。

At the same time, we have been able to bring new content into that growth rate. So you're seeing a combination of the strong end market as well as content.

同時，我們已經能夠將新內容帶入這一成長率。所以你會看到強大的終端市場和內容的結合。

So you mentioned restructuring. So in the third quarter, we did have more restructuring action. We consolidated a site in Germany, and we continue to reposition transformation initiatives within our current existing sites. And I expect this activity to continue given the weak end market demand that we're seeing.

所以你提到了重組。所以在第三季度，我們確實有更多的重組行動。我們整合了德國的一個工廠，並繼續在現有工廠內重新定位轉型計畫。鑑於我們所看到的終端市場需求疲軟，我預計這項活動將持續下去。

The next question is from Joseph Giordano with Cowen.

下一個問題是約瑟夫·佐丹奴和考恩提出的。

This is Robert in for Joe. I just had a quick question. As we head into 2020, which end markets do you think are most at risk next year versus your current expectations? And then I have a quick follow-up after that.

這是羅伯特代替喬。我只是有一個簡單的問題。當我們進入 2020 年時，與您目前的預期相比，您認為明年哪些終端市場面臨的風險最大？之後我會進行快速跟進。

Yes. I think, as Paul mentioned earlier, we're doing a lot of work to try to understand the landscape for 2020. So I want to be very careful to tell you that these are preliminary thoughts at best. I think when we think about what's at risk going forward, we're looking at where we're already seeing quite a bit of contraction. And so we're beginning to recognize that things like China PMI are stabilizing it, but unfortunately, it's still a contraction rate. So probably not a risk of accelerated declines like we've seen, but we don't see recovery, at least in the first half of the year most likely.

是的。我認為，正如保羅之前提到的，我們正在做大量工作來嘗試了解 2020 年的情況。所以我想非常小心地告訴大家，這些充其量只是初步的想法。我認為，當我們思考未來面臨的風險時，我們會考慮哪些地方已經出現了相當大的收縮。因此，我們開始認識到中國 PMI 之類的因素正在穩定它，但不幸的是，它仍然是收縮率。因此，可能不會像我們所看到的那樣加速下滑的風險，但我們看不到復甦，至少在今年上半年最有可能。

The one end market that we've not seen have a lot of correction is North American auto. So the GM strike notwithstanding, that's a market that has been operating, I think, above expectations, slightly down, but above expectations. So that's another area we're watching quite closely.

我們沒有看到出現大量調整的終端市場是北美汽車。因此，儘管通用汽車罷工，我認為這個市場的運作情況一直高於預期，略有下降，但高於預期。這是我們正在密切關注的另一個領域。

When we look at the balance of our end markets, our HVOR segment is definitely in correction territory and will probably remain there as we move into 2020. So don't expect a surprise, but definitely not counting on an improved outlook for a good portion of 2020. So those are very preliminary thoughts. We would encourage everybody to do their work on those end markets themselves, but those are the ones that affect Sensata.

當我們審視終端市場的平衡時，我們的 HVOR 細分市場肯定處於調整區域，並且在進入 2020 年時可能會保持這種狀態。因此，不要指望會出現意外，但也絕對不要指望 2020 年大部分時間的前景會有所改善。所以這些都是非常初步的想法。我們鼓勵每個人自己在這些終端市場上進行工作，但這些才是影響森薩塔的因素。

Okay. Perfect. And then my follow-up would be, just have you seen any sequential bottoming or sign of a sequential bottoming within the industrial end market?

好的。完美的。然後我的後續行動是，您是否看到工業終端市場有任何連續觸底或連續觸底的跡象？

For us, what we see in that particular end market, just given where we operate in the supply chain, we see an awful lot of inventory takeout. And while that occurs, our conclusion is that it has -- it has not yet sort of stabilized. So we'll be watching that one closely, but that's one of the phenomena that's affecting our reguide in the fourth quarter.

對我們來說，我們在那個特定的終端市場看到的情況，考慮到我們在供應鏈中的營運位置，我們看到大量的庫存被消耗。當這種情況發生時，我們的結論是它已經——但尚未穩定下來。因此，我們將密切關注這個問題，但這是影響我們第四季重新指南的現象之一。

The next question is from William Stein from SunTrust.

下一個問題來自 SunTrust 的 William Stein。

I'd like to follow up on the investment in Smart & Connected. I think most of us are aware that the initial foray into this market is from Schrader and acquisition. And now there's organic investment. It would seem that there may be opportunities for M&A in this area to broaden and deepen the portfolio. Should we anticipate this as an M&A focus area of the company?

我想跟進一下對智慧互聯的投資。我想我們大多數人都知道，最初進入這個市場是來自施拉德和收購。現在有有機投資。看來該領域可能有併購機會來擴大和深化投資組合。我們是否應該將其視為公司的併購重點領域？

Well, certainly, as you pointed out, a major element of the foundation of this did come originally through an M&A activity. And at the time of that, when we acquired Schrader, we knew there would be more opportunities for use of wireless sensing. We do have a healthy pipeline. Smart & Connected and Electrification are among that pipeline in terms of opportunities. So we will continue to look at it.

嗯，當然，正如您所指出的，這一基礎的一個主要元素最初確實來自併購活動。當時，當我們收購 Schrader 時，我們知道無線感測的使用將會有更多機會。我們確實有一個健康的管道。就機會而言，智慧互聯和電氣化屬於其中。所以我們會繼續關注。

I think it's important to note also that it's not just the wireless capability that was brought to us in terms of the ability to serve this new segment, it's also the strong position we have with our core HVOR business, and it's the tough-to-do applications that can be converted into a wireless capability to bring it to this vehicle area network solution. So it's a combination of those organic and inorganic to really bring this to market into where it is today.

我認為還需要注意的是，這不僅是我們為這個新細分市場提供服務的能力所帶來的無線功能，也是我們在核心 HVOR 業務中所擁有的強勢地位，而且是難以-開發可以轉換為無線功能的應用程序，以將其帶入此車輛區域網路解決方案。因此，它是有機和無機的結合，才能真正將其推向市場，達到今天的水平。

I think that the one thing you can really count on is that when we do acquisitions, they are very much aligned to our strategy. You've seen that in electrification with the GIGAVAC acquisition. You look at our acquisition of Schrader, very much tied to the sensor strategy. So to the extent that you're understanding our strategy, and we appreciate the work that folks do to do that, you'll not be surprised by the acquisitions we make.

我認為你真正可以信賴的一件事是，當我們進行收購時，它們與我們的策略非常一致。您已經透過收購 GIGAVAC 在電氣化領域看到了這一點。你看看我們對 Schrader 的收購，這與感測器策略密切相關。因此，只要您了解我們的策略，並且我們欣賞人們為此所做的工作，您就不會對我們的收購感到驚訝。

Okay. Appreciate that color. One more, if I can. There've been other -- one acquisition recently, GIGAVAC, you provided a little bit of color a minute or 2 ago. But if you could maybe go a little deeper as to traction with the products coming out of that business and sort of as it's developed a little bit more of a standalone business relative to the way you've typically integrated these much more, well, much more completely, let's say, as opposed to letting acquisitions stand alone. So an update there? And then also the partnerships with Quanergy and Lithium Balance, any update on those would be helpful.

好的。欣賞那個顏色。如果可以的話，再來一張。還有其他的——最近的一次收購，GIGAVAC，你在一兩分鐘前提供了一點顏色。但是，如果你可以更深入地了解該業務中產品的吸引力，並且相對於你通常集成這些產品的方式，它開發了更多的獨立業務，那麼，更多比方說，更徹底地進行收購，而不是讓收購單獨進行。那麼有更新嗎？然後還有與 Quanergy 和 Lithium Balance 的合作關係，任何有關這些的更新都會有所幫助。

Yes. So we'll tag team this a bit. They're really important topics inside Sensata. Just to put the frame around what's happening at GIGAVAC. The engineering expertise, the technical expertise that we acquire with that business is really important, but we already have highly commingled technical teams. So we've staffed from legacy Sensata into California where the Electrification team sits, the contactor team sits. We've already launched manufacturing inside core Sensata sites in China and in Mexico, for example, and that's all about expanding our position in the automotive market. So things are progressing quite well. We've had some wins and some design-ins that would not have happened for standalone GIGAVAC, just given our ability to engage globally with auto and industrial customers as well. So I think nice progress there.

是的。所以我們會稍微標記一下團隊。它們是森薩塔內部非常重要的主題。只是為了了解 GIGAVAC 正在發生的事情。我們透過該業務獲得的工程專業知識和技術專業知識非常重要，但我們已經擁有高度混合的技術團隊。因此，我們從傳統的森薩塔公司調派了人員到加州，那裡是電氣化團隊和接觸器團隊所在地。例如，我們已經在中國和墨西哥的森薩塔核心工廠啟動了製造業務，這一切都是為了擴大我們在汽車市場的地位。所以事情進展順利。我們已經取得了一些勝利和一些設計，這些對於獨立的 GIGAVAC 來說是不可能發生的，只要我們有能力在全球範圍內與汽車和工業客戶進行互動。所以我認為這方面取得了不錯的進展。

Not a lot to say about Quanergy. We see the overall level 4, level 5 autonomous driving opportunity really pushing out there. And so as we think about the pace of our investments, that's an area where we probably turned down a bit versus where we've been in the past. And Jeff, you want to say anything?

關於 Quanergy 沒什麼好說的。我們看到 4 級、5 級自動駕駛的整體機會確實在不斷湧現。因此，當我們考慮我們的投資步伐時，與過去相比，我們可能會在這個領域有所拒絕。傑夫，你有什麼想說的嗎？

Yes. On the Lithium Balance side, we spoke a fair amount on the last call regarding this topic in terms of not only Lithium Balance, but the other organic activities that we've been undertaking, wireless battery management and so forth, and how they fit together to form what is Sensata's Electrification strategy. More to be done there, but we feel really good about the progress and the integration, which varies depending on the partnership or the acquisition that we're talking about, to optimize for the outcome rather than having a one-size-fits-all. And it's been really good progress in terms of Lithium Balance and the engagement that we've had with our customers and the help that is provided to us in terms of our continued progress on Wireless Battery Management. So good progress there.

是的。在鋰平衡方面，我們在上次電話會議上就該主題進行了大量討論，不僅涉及鋰平衡，還涉及我們一直在進行的其他有機活動，無線電池管理等，以及它們如何組合在一起形成森薩塔電氣化戰略。還有更多工作要做，但我們對進展和整合感到非常滿意，這取決於我們正在談論的合作夥伴關係或收購，以優化結果而不是一刀切。在鋰平衡方面以及我們與客戶的互動以及在無線電池管理方面的持續進展方面為我們提供的幫助方面，這確實是一個很好的進展。那裡進展順利。

The next question is from Craig Hettenbach with Morgan Stanley.

下一個問題來自摩根士丹利的 Craig Hettenbach。

Yes. Just a question on kind of operating margin, just thinking longer term. In particular, Jeff, as you kind of laid out some of the growth initiatives, should we think of -- is there any kind of reallocating of resources or just kind of within what footprint you're expected to kind of invest to drive margins longer term?

是的。只是一個關於營業利益率的問題，只是考慮更長遠的問題。特別是，傑夫，當你列出一些成長計畫時，我們是否應該考慮一下——是否有任何形式的資源重新分配，或者只是在你預計投資的範圍內，以延長利潤率學期？

Yes. That's a great question. So to date, we've talked about the fact that we've been investing in the Smart & Connected initiative for about 18 months to 2 years already. And it's been a sizable investment, it's been in the $15 million range per year that we've been invested in. We've done that by doing exactly what you've just said. We've reallocated investments to where the biggest opportunities are long-term for Sensata.

是的。這是一個很好的問題。到目前為止，我們已經討論了這樣一個事實：我們已經投資智慧互聯計畫約 18 個月到 2 年了。這是一項相當大的投資，我們每年的投資額約為 1500 萬美元。我們正是按照您剛才所說的做到了這一點。我們已將投資重新分配到對森薩塔而言具有最大長期機會的領域。

I think the question that Martha was sort of getting at when she talked about the frame there, is there may be a point in time where we need to invest incrementally and we'll speak to that and we'll call it out. We're not talking about huge amounts of money here, but the example we gave is we want to double down, if you will, double the investment on Smart & Connected as the proof points continue to come in. That's the kind of range to be thinking about to help transform as well as what other people have mentioned around some of the inorganic activity that we might be able to do there.

我認為瑪莎在談論那裡的框架時所提出的問題是，可能在某個時間點我們需要增量投資，我們會對此進行討論，我們會指出這一點。我們在這裡談論的不是巨額資金，但我們給出的例子是，如果您願意的話，隨著證據不斷出現，我們希望將智能與互聯的投資加倍。這就是需要考慮幫助轉型的範圍，以及其他人提到的我們可能能夠在那裡進行的一些無機活動。

Got it. And then just a follow-up question for Martha. I appreciate the color on kind of the macro and end markets, but -- and as you said, none of these cycles are the same in terms of how they play out. But just the recent deterioration or inventory adjustments in heavy vehicle and industrial, any other signals you're seeing from the customers in terms of where they are in terms of the progress to kind of realign inventory to lower demand?

知道了。接下來是瑪莎的後續問題。我很欣賞宏觀和終端市場的色彩，但是──正如你所說，這些週期的表現方式都不一樣。但是，最近重型車輛和工業領域的情況惡化或庫存調整，您從客戶那裡看到了任何其他訊號，表明他們在調整庫存以降低需求方面取得了進展？

Yes. I would say not much beyond what I've already described. There's generally a phenomena of us keeping a really tight eye on what's happening with their orders to the extent that we can and then with production. And usually, it's more what they do versus what they say. So our call-offs will often reflect what we can expect to see in terms of inventory takeout on both their end and also in our own component level inventory. So those are the things that we look at.

是的。除了我已經描述過的內容之外，我不會說太多。一般來說，我們會盡可能密切注意他們的訂單以及生產情況。通常，更多的是他們所做的而不是他們所說的。因此，我們的取消通常反映出我們可以預期在他們的庫存消耗以及我們自己的組件級庫存方面看到的情況。這些就是我們所關注的事情。

The last question is from Jim Suva with Citi.

最後一個問題是花旗銀行的吉姆·蘇瓦 (Jim Suva) 提出的。

I believe it was either Martha or Jeff mentioned an inventory correction in HVOR takes about 4 to 6 quarters, if I heard that right. So does that put us basically exiting 2020, assuming demand doesn't get much, much worse, but exiting 2020 is likely the equilibrium for much better growth? And I think that was for HVOR, the comment.

我相信瑪莎或傑夫提到 HVOR 的庫存調整大約需要 4 到 6 個季度，如果我沒聽錯的話。那麼，假設需求不會變得非常非常糟糕，那麼這是否會讓我們基本上退出 2020 年，但退出 2020 年可能是實現更好成長的均衡？我認為這是針對 HVOR 的評論。

And then on the auto side, was there inventory we have to think about working through that? And how long should that take? I know you mentioned the GM strike a lot on the auto side, but I was curious about the inventory.

然後在汽車方面，我們是否需要考慮解決庫存問題？那需要多長時間？我知道您多次提到汽車方面的通用汽車罷工，但我對庫存感到好奇。

Jim, it's Martha. Yes, I was responding to a question around how long do we -- does it generally take the HVOR market to cycle. So that was less about inventory takeout relative to those end markets than just studying past corrections in those end markets and how long do they take to play out. That was what the sort of 4 to 6 quarter phenomena I described. And there's outliers on either side of that. So it's information that's probably available for everybody to do their homework on.

吉姆，是瑪莎。是的，我正在回答一個關於 HVOR 市場通常需要多長時間才能週期的問題。因此，這並不是關於相對於這些終端市場的庫存消耗，而是只是研究這些終端市場過去的調整以及它們需要多長時間才能發揮作用。這就是我所描述的那種四到六季的現象。兩邊都有異常值。因此，每個人都可以利用這些資訊來做功課。

On the auto piece, so yes, in addition to that correction, we're seeing inventory correction on top of end order rates.

在汽車領域，是的，除了調整之外，我們還看到最終訂單率之外的庫存調整。

On the auto side, the vehicle inventory is more visible. Generally speaking, the industry is in control on vehicle inventory given the GM strike, actually North America is quite low, GM is quite low right now in vehicle inventory and they will be trying to build that back. And there's much less component level inventory in the overall supply chain. So the places we have to keep our eye on in terms of inventory corrections are in Europe. That's -- we're expecting more -- some of that as we get into the fourth quarter. That's some of the thinking that's in our guide as well.

在汽車方面，車輛庫存更加明顯。一般來說，鑑於通用汽車的罷工，該行業控制了汽車庫存，實際上北美的汽車庫存相當低，通用汽車目前的汽車庫存也相當低，他們將努力恢復這一庫存。而且整個供應鏈中的組件級庫存要少得多。因此，我們在庫存調整方面必須關注的地方是歐洲。當我們進入第四季度時，我們預計會有更多。這也是我們指南中的一些想法。

This concludes the time we have allotted for today's call. I'd like to now turn the call back over to Joshua Young for closing remarks.

我們為今天的電話會議分配的時間到此結束。我現在想將電話轉回約書亞楊（Joshua Young）做總結演講。

I'd like to thank everybody for joining us this morning. Sensata will be attending the Robert Baird Industrial Conference in Chicago next week as well as the Cowen Industrial & Technology Summit on November 19 in New York. We invite you to visit us at these conferences or our headquarters in Attleboro, Massachusetts. Thank you for joining us this morning and for your interest at Sensata. You may now end the call.

我要感謝大家今天早上加入我們。森薩塔將參加下週在芝加哥舉行的 Robert Baird 工業會議以及 11 月 19 日在紐約舉行的 Cowen 工業與技術高峰會。我們邀請您參觀我們的這些會議或參觀我們位於馬薩諸塞州阿特爾伯勒的總部。感謝您今天早上加入我們以及對森薩塔的興趣。您現在可以結束通話了。

Conference call has now concluded. Thank you for attending today's presentation. You may now disconnect.

電話會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。