台積電 ADR (TSM) 2015 Q1 法說會逐字稿

Welcome to TSMC's first-quarter 2015 earnings conference and conference call. This is Elizabeth Sun, TSMC's Director of Corporate Communications and your host for today.

歡迎參加台積電2015年第一季業績發表會及電話會議。我是台積電企業傳播總監伊莉莎白·孫，也是今天的主持人。

Today's event is webcast live via TSMC's website at www.tsmc.com. If you are joining us through the conference call, your dial-in number -- your dial-in lines are in listen-only mode. As this conference is being viewed by investors around the world, we will conduct this event in English only.

今天的活動透過台積電網站 www.tsmc.com 進行網路直播。如果您透過電話會議加入我們，您的撥入號碼 - 您的撥入線路處於只聽模式。由於此次會議將受到全球投資者的關注，因此我們將僅以英語進行本次活動。

The format for today's event will be as follows. First, TSMC's Senior Vice President and CFO, Ms. Lora Ho, will summarize our operations in the first quarter followed by our guidance for the current quarter. Afterwards, TSMC's two Presidents and Co-CEOs, Dr. Mark Liu and Dr. C.C. Wei, will jointly provide a couple of key messages. Then we will open both the floor and the line for the Q&A.

今天活動的形式如下。首先，台積電資深副總裁兼財務長何麗拉女士將總結我們第一季的營運狀況，然後介紹本季的預期。隨後，台積電兩位總裁兼聯席執行長劉德華博士和陳建昌博士分別致詞。魏先生將共同傳遞幾點重要訊息。然後我們將開放現場和熱線供大家提問。

For those participants on the call, if you do not yet have a copy of the press release, you may download it from TSMC's website at www.tsmc.com. Please also download the summary slides in relation to today's earnings conference presentation.

對於電話會議的參與者，如果您尚未收到新聞稿，您可以從台積電網站 www.tsmc.com 下載。請同時下載與今天的收益會議報告相關的摘要投影片。

As usual, I would like to remind everybody that today's discussions may contain forward-looking statements that are subject to significant risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Please refer to the Safe Harbor notice that appears on our press release.

像往常一樣，我想提醒大家，今天的討論可能包含前瞻性陳述，這些陳述受重大風險和不確定性的影響，可能導致實際結果與前瞻性陳述中的結果有重大差異。請參閱我們新聞稿中的安全港通知。

And now I would like to turn the podium to TSMC's CFO, Ms. Lora Ho, for a summary of the operations and current quarter guidance.

現在，我想請台積電財務長何麗拉女士總結一下公司營運狀況和本季業績指引。

Thank you, Elizabeth. Good afternoon, everyone. Thank you for joining us today. My presentation will start with financial highlights for the first quarter and followed by the guidance for the second quarter.

謝謝你，伊麗莎白。大家下午好。感謝您今天加入我們。我的演講將從第一季的財務亮點開始，然後介紹第二季的指引。

First let me summarize our first-quarter performance. In first quarter we have achieved TWD222b in revenue, 49.3% gross margin, 39% operating margin and TWD3.05 in EPS, which are all within our guidance range.

首先，讓我總結一下我們第一季的業績。第一季度，我們實現了2,220億新台幣的營收、49.3%的毛利率、39%的營業利潤率和3.05新台幣的每股收益，均在我們的預期範圍內。

On a year-over-year basis, first quarter showed very strong growth versus last year. Our revenue increased 50%. Gross margin and operating margin went up by 1.8 percentage point and 3.6 percentage point respectively. Net income and EPS both increased 65% versus the same period last year.

與去年同期相比，第一季的成長非常強勁。我們的收入增加了50%。毛利率及營業利益率分別上升1.8個百分點及3.6個百分點。淨收入和每股收益較去年同期均成長65%。

On a sequential basis, the wafer demand for the first quarter remained strong. But NT dollar was stronger than the assumption in our first-quarter guidance by about 1%, which reduced our revenue by TWD1.9b. Despite that, our first-quarter revenue remained essentially flat versus fourth quarter last year.

以環比計算，第一季的晶圓需求依然強勁。但新台幣匯率比我們第一季預測的強約1%，導致我們的營收減少了19億新台幣。儘管如此，我們的第一季營收與去年第四季基本持平。

On the profitability side, gross margin was slightly lower than fourth quarter, mainly due to lower capacity utilization, offset by cost improvement, favorable inventory valuation adjustments and a favorable foreign exchange rate.

在獲利能力方面，毛利率略低於第四季度，主要由於產能利用率較低，但被成本改善、有利的庫存估價調整和有利的外匯匯率所抵銷。

Let's take a look at the revenue by application. During the first quarter, communication and computers declined 9% and 10% sequentially, while consumer and industrial increased 32% and 19% respectively.

我們來看看各應用的收入。第一季度，通訊和電腦領域較上季下降 9% 和 10%，而消費和工業領域分別成長 32% 和 19%。

By technology, 20-nanometer revenue contribution decreased from 21% in the fourth quarter last year to 16% in the first quarter this year due to key customers' product seasonality. Meanwhile customers' demand for our 28-nanometer wafers remained solid and contributed 30% of wafer revenue. Accordingly, these two advanced technologies, 20-nanometer and 28-nanometer, represented 46% of our first-quarter wafer revenue, 5 percentage points lower than the fourth quarter last year.

從技術面來看，受主要客戶產品季節性影響，20奈米營收貢獻從去年第四季的21%下降至今年第一季的16%。同時，客戶對我們28奈米晶圓的需求依然強勁，貢獻了晶圓收入的30%。因此，20奈米和28奈米這兩項先進技術占我們第一季晶圓收入的46％，比去年第四季下降了5個百分點。

Now let's move on to the balance sheet. On the asset side, cash and marketable securities increased TWD82b to a record level of TWD519b at the end of the first quarter.

現在讓我們來看看資產負債表。資產方面，現金及有價證券增加820億新台幣，至第一季末創紀錄的5,190億新台幣。

On the liability side, current liabilities decreased by TWD13b as we paid down TWD17b of short-term bank loans. As cash continued to increase, the debt ratio has come down from 30% level in the past two years to 28% in the first quarter.

負債方面，因償還170億新台幣短期銀行貸款，流動負債減少130億新台幣。隨著現金不斷增加，負債比率已從過去兩年的30%水準下降至第一季的28%。

Working capital remained healthy. The accounts receivable turnover days decreased 3 days to 44 days. Days of inventories decreased by 1 day to 57 days.

營運資本保持健康。應收帳款週轉天數減少3天至44天。庫存天數減少1天，至57天。

Now let me make a few comments on cash flow and CapEx. During the first quarter we generated TWD156b cash from operations and invested TWD49b in capital expenditure. As a result, free cash flow reached a record level of TWD107b and cash balance increased to TWD437b or about $14b at the end of the first quarter.

現在，讓我對現金流和資本支出發表一些評論。第一季度，我們經營活動產生的現金流量為1,560億新台幣，資本支出為490億新台幣。結果，自由現金流達到了創紀錄的1,070億新台幣，現金餘額在第一季末增加到4,370億新台幣，約合140億美元。

So I have finished my report of the financial part. Now let's turn to the second-quarter outlook.

我已經完成了財務部分的報告。現在讓我們來看看第二季的展望。

In the second quarter, a combination of the key customers' business loss to a captive IDM; inventory adjustment, which will be explained in more detail by Mark; and less favorable exchange rate, all three will negatively impact our business. Based on our current business outlook and the forecast exchange rate of TWD31.03, we expect our second-quarter revenue to be between TWD204b and TWD207b, representing a 7% to 8% Q-over-Q decline.

第二季度，主要客戶的業務損失歸於專屬IDM；庫存調整，馬克將對此進行更詳細的解釋；以及不利的匯率，這三者都會對我們的業務產生負面影響。根據我們目前的業務前景和預測匯率31.03新台幣，我們預計第二季營收將在2,040億至2,070億新台幣之間，較上季下降7%至8%。

Gross profit margin to be between 47.5% and 49.5%. And operating margin to be between 36.5% and 38.5%.

毛利率介於47.5%至49.5%之間。營業利益率在36.5%至38.5%之間。

Here I will give you a reminder about tax. As you know, in every second quarter we will need to accrue a 10% tax on undistributed retained earnings. As a result, our quarterly tax rate in this second quarter will go up to 24%. I also want to inform you that the approximately TWD15b gain from ASML share disposal is not a taxable item. After the second quarter, the tax rate will fall back to 11% in the third and fourth quarter and our full-year tax rate will be about 14%.

在這裡我給大家提一下關於稅收方面的提醒。如您所知，每個第二季我們都需要對未分配保留收益徵收 10% 的稅。因此，我們第二季的季度稅率將上調至 24%。我還想告知您，ASML 股份出售所得的約 150 億新台幣收益不屬於應稅項目。第二季之後，第三、四季稅率會回落到11%，全年稅率大概在14%左右。

In addition to the second-quarter guidance, I will also update you on our CapEx. Our 2015 full-year CapEx will be reduced by $1b. So we now expect our CapEx this year will be between $10.5b and $11b.

除了第二季的指引外，我還將向您介紹我們的資本支出狀況。我們的2015年全年資本支出將減少10億美元。因此，我們現在預計今年的資本支出將在 105 億美元至 110 億美元之間。

The reduction mainly came from two areas. The first area, we have continually improved our capital efficiency, which allows us to spend less but still achieve the same capacity. And we are migrating our 20-nanometer to 16-nanometer faster, which allows us to convert more of the 20-nanometer tools to be used for 16-nanometer at a lower CapEx.

減少主要來自兩個方面。第一個領域，我們不斷提高資本效率，這使我們能夠以更少的投入實現相同的產能。我們正在更快地將 20 奈米遷移到 16 奈米，這使我們能夠以更低的資本支出將更多的 20 奈米工具轉換為 16 奈米。

The $1b CapEx reduction will not affect our overall capacity build-up for the whole year. We will increase our 16 capacity while decrease our 20-nanometer capacity.

10億美元的資本支出減少不會影響我們全年的整體產能建設。我們將增加16奈米的產能，同時減少20奈米的產能。

Finally, despite of the lower second quarter, we expect revenue for the second half of the year will recover and the full year will be double-digit growth over 2014.

最後，儘管第二季收入較低，但我們預計下半年營收將會回升，全年營收將比 2014 年實現兩位數成長。

This concludes my remarks. Thank you very much.

我的發言到此結束。非常感謝。

Now our two Presidents and Co-CEOs will deliver the key messages. We'll start with Mark.

現在，我們的兩位總裁和聯合執行長將發表重要演講。我們先從馬克開始。

Good afternoon. I will deliver the key messages.

午安.我將傳達主要訊息。

First on the near-term demand. The demand of TSMC wafers remained strong in the first quarter. This led to our 1Q quarterly revenue to be essentially flat from fourth quarter last year.

首先是近期需求。第一季台積電晶圓需求依然強勁。這導致我們第一季的季度營收與去年第四季基本持平。

In the second quarter, some of our customers appear too optimistic on their own market outlook. As a result, the inventory level of them appeared to be higher than they planned. Recently we saw several mobile customers cut back their delivery schedule because their demand did not come to what they anticipated. Therefore we forecast our second-quarter demand will be below normal and quarterly revenue will decline by about 7% to 8% from first quarter.

在第二季度，我們的一些客戶對自身的市場前景顯得過於樂觀。結果，他們的庫存水準似乎高於他們的計劃。最近，我們看到一些行動客戶縮短了他們的送貨時間表，因為他們的需求沒有達到他們的期望。因此，我們預測第二季的需求將低於正常水平，季度營收將較第一季下降約 7% 至 8%。

Our near-term market demand will then be more moderate than we estimated in January. We now estimate fabless companies exit the first quarter with inventory days higher than seasonal level. However, we think it will be back to normal towards the end of second quarter this year.

因此，我們近期的市場需求將比我們一月份的估計更為溫和。我們現在估計，第一季結束時無晶圓廠的庫存天數將高於季節性水準。不過，我們認為今年第二季末將恢復正常。

So forward looking for full year, we will be continuously working on a double-digit revenue growth year for 2015.

展望全年，我們將繼續致力於 2015 年實現兩位數的營收成長。

Next I want to comment a few on our long-term outlook. TSMC target our long-term revenue, CAGR compound annual growth -- average growth rate to be 10% in the next five years. We intend to maintain our structural profitability and the net profit growth will be in line with revenue growth.

接下來我想對我們的長期展望發表一些評論。台積電的目標是我們的長期收入，CAGR複合年增長率－未來五年的平均成長率為10%。我們打算維持結構性獲利能力，淨利成長將與收入成長一致。

The continuous demand of more functionality and integration in smartphones drives for more silicon content. We expect smartphones will continue to drive our growth in the next several years.

智慧型手機對更多功能和整合的持續需求推動了對矽含量的要求的提高。我們預計智慧型手機將在未來幾年繼續推動我們的成長。

In the meantime, we see IoT appears us -- present us new growth opportunities. The proliferation of IoT not only will bring us growth in the sensor, connectivity and advanced packaging areas, the associated application and services, such as big data analytics, will also further our growth in the computation space, including application processor, network processor, image processor, graphic processor, microcontroller and other various processors. That was the long-term outlook.

同時，我們看到物聯網的出現—為我們帶來了新的成長機會。物聯網的普及不僅將為我們帶來感測器、連接和先進封裝領域的成長，相關應用和服務（如大數據分析）也將進一步促進我們在運算領域的成長，包括應用處理器、網路處理器、影像處理器、圖形處理器、微控制器和其他各種處理器。這是長期前景。

I'll update some of our 10-nanometer development progress. Our 10-nanometer technology development is progressing well. Our technology qualification remains in Q4 this year.

我將更新一些我們的10奈米開發進度。我們的10奈米技術開發進展順利。我們的技術資質在今年第四季依然保留。

Recently we have successfully achieved fully functional yields of our 256-megabit SRAM. Currently we have more than 10 customers fully engaged with us on 10-nanometer. We still expect to have 10-nanometer volume ramp in fourth quarter 2016 and to contribute billing in early 2017.

最近，我們已成功實現 256 兆位元 SRAM 的完全功能產量。目前，我們已經有超過 10 位客戶與我們全面合作進行 10 奈米技術研究。我們仍預計 10 奈米製程將在 2016 年第四季實現量產，並在 2017 年初產生營收貢獻。

This technology adopts our third-generation FinFET transistor and have scaling more than one generation. Its price is fully justified by its value for various applications, including application processor, baseband SoC, network processor, CPU and graphic processors. Its cost and price ratio will comply to our structural profitability considerations.

該技術採用了我們的第三代FinFET晶體管，並且已經超越了一代。其價格完全符合其對各種應用的價值，包括應用處理器、基頻 SoC、網路處理器、CPU 和圖形處理器。其成本與價格比將符合我們的結構性獲利考量。

As for new technology development at TSMC, I'd like to start with -- to update you our 7-nanometer development. We have started our 7-nanometer technology development program early last year. We also have rolled out our 7-nanometer design and technology collaboration activity with several of our major customers. Our 7-nanometer technology developments today are well in progress.

至於台積電的新技術開發，我想先向大家介紹我們 7 奈米技術的發展。我們去年年初就啟動了7奈米技術開發計畫。我們也與幾位主要客戶進行了 7 奈米設計和技術合作活動。我們今天的 7 奈米技術開發正在順利進行中。

TSMC's 7-nanometer technology will leverage most of the tools used in 10-nanometer, in the meantime achieve a new generation of technology value to our customers. The 7-nanometer technology risk production date is targeted at early 2017.

台積電7奈米技術將充分利用10奈米技術所使用的大部分工具，同時為我們的客戶實現新一代技術的價值。7奈米技術風險量產日期預定為2017年初。

Now I would like to give you an update on EUV. We have been making steady progress on EUV. Both our development tools, we have two NXE 3300 have been upgraded to the configuration of 80 watt of EUV power, with an average wafer throughput of a few hundred wafers per day. We continue to work with ASML to improve tool stability and availability. We also are working with ASML and our partners on developing the infrastructure of EUV, such as masks and resists.

現在我想向大家介紹有關 EUV 的最新進展。我們在 EUV 方面一直在穩步取得進展。我們的兩種開發工具，我們有兩台 NXE 3300，都已升級到 80 瓦 EUV 功率的配置，平均每天的晶圓吞吐量為數百片晶圓。我們繼續與 ASML 合作，以提高工具的穩定性和可用性。我們也與 ASML 及其合作夥伴共同開發 EUV 的基礎設施，例如光罩版和光阻。

Although today the process on record of both 10-nanometers and 7-nanometer are on immersion tools, with innovative multiple patterning techniques, we will continue to look for opportunity to further reduce the wafer cost and simplify the process flow by inserting EUV layer in the process.

儘管今天記錄的 10 奈米和 7 奈米製程都是採用浸入式工具，但憑藉創新的多重圖案化技術，我們將繼續尋找機會透過在製程中插入 EUV 層來進一步降低晶圓成本並簡化製程。

Now I'd like to give you an update of our recently announced ultra-low-power technologies. We have offered the industry's most comprehensive ultra-low-power technology portfolio, ranging from 55-nanometer ULP, 40-nanometer ULP, 28-nanometer ULP, to the recently announced 16 FFC, a compact version of 16 FinFET Plus, enable continual reduction of operating voltage and power consumption. Today more than 30 product tape-outs planned in 2015 from more than 25 customers.

現在我想向大家介紹一下我們最近宣布的超低功耗技術的最新進展。我們提供了業界最全面的超低功耗技術組合，從55奈米ULP、40奈米ULP、28奈米ULP，到最近發布的16FFC、16FinFETPlus的緊湊版，能夠持續降低工作電壓和功耗。目前，超過 25 家客戶計劃於 2015 年推出 30 多種產品。

This 55- and 40-nanometer ULP will be the most cost-effective solution for low- to mid-performance wearable and IoT devices. The 28 ULP and 16 FFC will be the most power-efficient solution for high-performance IoT applications. In particular, our 16 FFC offers the ultra-low-power operation at a supply voltage of 0.55 volts, with higher performance than all of the FD-SOI technologies marketed today.

這款 55 奈米和 40 奈米 ULP 將成為中低性能穿戴式裝置和物聯網設備最具成本效益的解決方案。28 ULP 和 16 FFC 將成為高效能物聯網應用最節能的解決方案。特別是，我們的 16 FFC 在 0.55 伏特電源電壓下提供超低功耗操作，其性能高於目前市場上的所有 FD-SOI 技術。

Lastly I'll give you an update of our recent IoT specialty technology development. We have developed the world's first 1.0-micron pixel size 16-megapixel CMOS image sensor, with stacked image signal processor, which was announced in March by our customer for the next-generation smartphone.

最後，我將向您介紹我們最近的物聯網專業技術開發的最新進展。我們開發了世界上第一款1.0微米像素尺寸1600萬像素CMOS影像感測器，配備堆疊式影像訊號處理器，我們的客戶在3月宣布將為下一代智慧型手機推出這款感測器。

Secondly, we continue to drive the best low resistance in BCD technology roadmap, from 0.18 micron to 0.13 micron and from 8-inch to 12-inch production for wireless charging and fast wired charging of mobile devices. We continue to extend our 0.13 BCD technology from consumer and industrial applications to automotive-grade electrical system control applications.

其次，我們繼續推動BCD技術路線圖中最佳的低電阻，從0.18微米到0.13微米、從8英吋到12英吋的生產，用於行動裝置的無線充電和快速有線充電。我們繼續將 0.13 BCD 技術從消費和工業應用擴展到汽車級電氣系統控制應用。

Lastly, recently we have started production in foundry's first 40-nanometer industrial embedded Flash technology that was started from November last year. And this technology recently passed automotive-grade qualification, that was in March, for engine control applications.

最後，最近我們已經開始生產代工廠首個40奈米工業嵌入式快閃記憶體技術，該技術是從去年11月開始的。這項技術最近在三月通過了汽車級認證，用於引擎控制應用。

That was my update of new technology. Now I'll hand the podium to C.C.

這就是我對新技術的更新。現在我將講台交給 C.C.

Okay. Thank you, Mark. Good afternoon, ladies and gentlemen. I will update you the 28-nanometer, 20 and 16 FinFET status and also our InFO business.

好的。謝謝你，馬克。女士們、先生們，午安。我將向您通報 28 奈米、20 和 16 FinFET 的狀態以及我們的 InFO 業務。

First, 28-nanometer. This is the fifth year since TSMC's 28-nanometer entered mass production. 28-nanometer has been a very large and successful node for us. Our market segment share at this node has held up well and is in the mid-70s this year. We expect this to continue in year 2016. In comparison, this is better than what we had in the 40-nanometer node.

第一，28奈米。今年已是台積電28奈米量產的第五年。28奈米對我們來說是一個非常大且成功的節點。我們在此節點的市佔率保持良好，今年約為70%左右。我們預計這一趨勢將在 2016 年持續下去。相較之下，這比我們在40奈米節點所取得的成績要好。

The demand for 28-nanometer is expected to grow this year due to the growth of mid- and low-end smartphones and as well as the second-wave segment, such as radio frequency, circuit product and the Flash controllers that migrate into this node.

由於中低階智慧型手機的成長以及第二波細分市場（例如遷移到該節點的射頻、電路產品和快閃記憶體控制器）的成長，預計今年對 28 奈米的需求將會成長。

However, due to some customers' inventory adjustments, which we believe is only going to be for the short term, the demand for 28-nanometer in the second quarter will be lower than our previous quarter, resulting in 28-nanometer capacity utilization rate to be in the high-80s range. But we expect the utilization rate of the 28-nanometer to recover soon and to be above 90% in the second half of this year.

但由於部分客戶的庫存調整，我們認為這只是短期現象，第二季對 28 奈米的需求將低於上一季度，導致 28 奈米產能利用率達到 80% 左右。但我們預計28奈米的利用率將很快恢復，並在今年下半年達到90％以上。

While we are in the mass production, we also continue to improve the performance of our technology. Last year we have introduced our 28-HPC, which is a compact version of 28-HPM. For the purpose of helping 64-bit CPU conversion for mid- to low-end market, this year we further improved the 28-HPC to 28-HPC Plus. For comparison, 28-HPC Plus will have 18% power consumption -- lower power consumption at the same speed or 15% faster speed at the same kind of power.

在實現量產的同時，我們也不斷提昇技術的性能。去年我們推出了 28-HPC，它是 28-HPM 的緊湊版。為了幫助中低階市場實現64位元CPU轉換，今年我們進一步將28-HPC改進為28-HPC Plus。相比之下，28-HPC Plus 的功耗為 18%——相同速度下功耗更低，相同功率下速度提高 15%。

As for the competitive position, we are confident that we will continue to lead in performance and yield. So far we do not see there is a very much effective capacity in High K metal gate at 28-nanometer outside TSMC. And since we have already shipped more than 3m 12-inch 28-nanometer wafers, the learning curve has given us an absolute advantage in cost.

至於競爭地位，我們有信心在性能和產量方面繼續領先。目前我們還沒有看到台積電以外的公司在28奈米高K金屬閘極方面有非常大的有效產能。而且由於我們已經出貨了超過300萬片12吋28奈米晶圓，學習曲線讓我們在成本上具有絕對優勢。

Now let me move to our 20 SoC. TSMC remains the sole solution provider in foundry industry for 20-nanometer process. Our yield has been consistently good after a very successful ramp last year. But recently we have observed customers' planned schedule for product migration from 20 nanometer to 16 FinFET started sooner than we forecasted three months ago.

現在讓我轉到我們的 20 SoC。台積電仍是晶圓代工產業20奈米製程的唯一解決方案提供者。自去年成功提升產量以來，我們的產量一直保持良好狀態。但最近我們觀察到客戶從20奈米到16 FinFET的產品遷移計畫比我們三個月前的預測還要早。

As a result, even we continue to grow 20-nanometer business in the second quarter of this year, our earlier forecast of 20-nanometer contributing above 20% of total wafer revenue this year has to be revised down by a few points to a level about the mid teens. That being the case, we still forecast the revenue from 20-nanometer will more than double that of year 2014's level.

因此，即使我們在今年第二季度繼續成長 20 奈米業務，我們先前對 20 奈米今年將貢獻總晶圓收入 20% 以上的預測也必須下調幾個點至大約 15% 左右的水平。儘管如此，我們仍預測20奈米的營收將比2014年的水準成長一倍以上。

Now 16 FinFET. The schedule for 16 FinFET high-volume production remains unchanged. We will begin ramping in the third quarter this year. And the ramp rate appeared be faster than we forecasted three months ago, thanks to the excellent yield learning that we can leverage our 20-nanometer experience and also due to a faster migration from 20-nanometer to 16 FinFET.

現在有 16 個 FinFET。16 FinFET 大批量生產計劃維持不變。我們將在今年第三季開始加大產能。而且由於我們可以利用 20 奈米經驗獲得出色的產量學習，並且從 20 奈米到 16 FinFET 的遷移速度更快，因此產量提升速度似乎比我們三個月前預測的要快。

In addition to good yield, our 16 FinFET device performance also met all products' specs due to our very good transistor engineering. So we believe our 16 FinFET will be a very long-life node due to its good performance and the right cost. This is very similar to our 28-nanometer node.

除了良好的產量之外，由於我們非常出色的電晶體工程設計，我們的 16 FinFET 裝置性能也符合所有產品的規格。因此，我們相信，由於我們的 16 FinFET 具有良好的性能和適當的成本，它將是一個壽命非常長的節點。這與我們的28奈米節點非常相似。

We are highly confident that our 16 FinFET is very competitive. As we've said repeatedly, combining 20-nanometer and 16-nanometer, we will have the largest foundry share in year 2015. And if we only look at 16-nanometer alone, we still can say TSMC will have the largest 16- or 14-nanometer foundry share in year 2016.

我們非常有信心，我們的 16 FinFET 非常具有競爭力。正如我們一再說過的，結合20奈米和16奈米，我們將在2015年擁有最大的代工份額。如果僅從 16 奈米來看，我們仍然可以說台積電將在 2016 年擁有最大的 16 奈米或 14 奈米代工份額。

Now let me move to our InFO business update. The schedule to ramp up the InFO in second quarter next year remains unchanged. We expect InFO will contribute more than $100m quarterly revenue by next year, fourth quarter next year, when it will be fully ramped.

現在讓我轉到我們的 InFO 業務更新。明年第二季增加 InFO 的計畫保持不變。我們預計，到明年第四季度，InFO 將全面實現成長，並貢獻超過 1 億美元的季度收入。

Right now we are building a new facility in Longtan, that's a city very near to Hsinchu, where our headquarters are, for ramping up InFO. Today a small product line is almost complete and it's ready for early engineering experiment. This pilot line will be expanded to accommodate the high-volume ramp in year 2016.

目前，我們正在龍潭建設一個新工廠，龍潭是一個離我們總部新竹很近的城市，用於加強 InFO。如今，一條小型產品線已基本完工並準備進行早期工程實驗。該試驗生產線將於 2016 年進行擴建，以滿足大批量生產要求。

And that's all. Thank you for your attendance.

就這樣。感謝您的出席。

All right. Thank you, C.C. This concludes our prepared statements. Before we begin the Q&A session, I would like to remind everybody to limit your questions to two at a time, so to allow all participants an opportunity to ask questions.

好的。謝謝你，C.C。我們的準備好的聲明到此結束。在我們開始問答環節之前，我想提醒大家每次提問的次數限制為兩個，以便所有參與者都有機會提問。

Questions will be taken both from the floor and from the call. Should you wish to raise your question in Chinese, I will translate that to English before our management answers your question.

問題將從現場和電話中回答。如果您想用中文提出問題，我會將其翻譯成英文，然後我們的管理層才會回答您的問題。

For those of you on the call, if you would like to ask a question, please press the star and then 1 on your telephone keypad now. Questions will be taken in the order in which they were received. If at any time you would like to remove yourself from the questioning queue, please press the pound or the hash key.

對於通話中的各位，如果您想提問，請立即按下電話鍵盤上的星號，然後按下 1。問題將按照收到的順序進行處理。如果您想隨時退出提問佇列，請按井號或雜湊鍵。

Now let's begin the Q&A session. Our first question comes from -- I see Andrew first, so Barclays, Andrew Lu.

現在我們開始問答環節。我們的第一個問題來自——我首先看到安德魯，還有巴克萊和安德魯·盧。

Thank you, Mark and C.C. Wei and Lora. I have a couple of questions. Thank you, Dr. Sun, because I haven't picked as the first one for a very, very long time.

謝謝你，馬克和 C.C。魏和勞拉。我有幾個問題。謝謝孫博士，因為我已經很久沒有選第一個了。

Earlier C.C. Wei mentioned 16 FinFET ramp-up was faster than earlier expected a few months ago. So can you give us some color on the revenue contribution by Q4? I suppose it should be also a few percentage points higher than a few months ago. I think earlier guidance is 9%, high single digit for Q4 revenue contribution from 16 FinFET.

此前，C.C.魏先生提到，16 FinFET 的成長速度比幾個月前預期的要快。那麼您能向我們介紹一下第四季的營收貢獻嗎？我想這也應該比幾個月前高出幾個百分點。我認為早先的預期是 16 FinFET 對第四季營收的貢獻為 9%，高個位數。

Andrew, I think you already answered the question by yourself, a few percentage more.

安德魯，我認為你自己已經回答了這個問題，還多了幾個百分點。

So no precise number, like 12% or 15% or something like that?

所以沒有精確的數字，例如 12% 或 15% 或類似的數字？

That's too specific.

這太具體了。

Okay. My second question for Mark. I think Mark presented at the Technology Symposium in San Jose mentioned that 16 FinFET versus competing technology is about 10% performance better. So can you elaborate what's 10% performance better? If our die size is larger than our competitors, how can we get the 10% performance better? Thank you.

好的。我的第二個問題是問馬克。我認為馬克在聖荷西技術研討會上提到，16 FinFET 與競爭技術相比，性能大約高出 10%。那你能詳細說明一下 10% 的性能更好嗎？如果我們的晶片尺寸比競爭對手大，我們如何獲得10％更好的性能？謝謝。

In the conference we talked about 16 FinFET Plus. That is our second-generation FinFET transistor. In that we improved our transistor performance a great deal. According to our information, that transistor speed, talk about speed at fixed power, is higher than the competitor by 10%. That's what I meant.

在會議上我們談到了16 FinFET Plus。這是我們的第二代 FinFET 電晶體。因此我們大大提高了晶體管的性能。根據我們的訊息，此電晶體的速度（即固定功率下的速度）比競爭對手高出 10%。我就是這個意思。

So how? Because of the transistor?

那麼如何呢？因為電晶體？

Yes, the transistor structure, transistor engineering.

是的，晶體管結構，晶體管工程。

Compared to competing -- is the competing the current competitor's solution or the next-generation competitor's solution? For example, LPE versus LPP or something like that?

與競爭相比——競爭是當前競爭對手的解決方案還是下一代競爭對手的解決方案？例如，LPE 與 LPP 或類似的東西？

The fastest one. The fastest.

最快的一個。最快的。

Their best one?

他們最好的一個？

Yes.

是的。

Thank you.

謝謝。

All right. Next question will go to Bank of America-Merrill Lynch, Dan Heyler.

好的。下一個問題將由美銀美林的 Dan Heyler 提出。

Thanks. Thanks, Elizabeth. So a couple of quick questions. Congratulations on the 16-nanometer success and faster yield ramp than previously planned. As you go to convert your 20 capacity to 16 due to those better yields, I guess two parts to the question.

謝謝。謝謝，伊麗莎白。我有幾個簡單的問題。恭喜 16 奈米技術取得成功並且產量提升速度比之前計劃的更快。由於收益更高，您要將 20 的容量轉換為 16 的容量，我猜這個問題可以分為兩個部分。

What's the implication on margin as you're converting a fab from -- I know you do this a lot, but this is a big transition with limited products. So as you're going from 20 to 16, what are the implications on margin? Can you -- do you take maybe one-quarter hit on margin before you get back to trend? Thank you.

當您將晶圓廠從工廠轉型時，這對利潤率有什麼影響？我知道您經常這樣做，但這是一個巨大的轉變，而且產品有限。那麼，當您從 20 降到 16 時，對利潤有何影響？在回到趨勢之前，您是否會承受大約四分之一的利潤損失？謝謝。

Dan, I will firstly talk about the implication for CapEx, probably that's the more important which will lead to the margin in a later stage. You know conversions, it costs less than adding new capacity. So when we see a node need to be converted, if we can do it faster, that means we can spend less CapEx. That's actually how this $1b reduction coming from.

丹，我首先要談談對資本支出的影響，這可能更重要，它將在後期影響利潤。您知道轉換的成本低於增加新容量的成本。因此，當我們看到需要轉換的節點時，如果我們能夠更快地完成轉換，這意味著我們可以花費更少的資本支出。這其實就是 10 億美元減幅的來源。

In terms of margin, actually it has multiple factors. Depreciation, of course, being number one. Other thing is how fast can you bring up your yield and how does economic scale get into play. So from what we have seen right now, we believe the 16-nanometer margin will begin better than our 20-nanometer margin because we have the basis of 20-nanometer.

對於利潤率，其實有多個因素。當然，折舊是第一位的。另一件事是你能多快提高產量以及經濟規模如何發揮作用。因此，從目前的情況來看，我們相信 16 奈米的利潤率將比 20 奈米的利潤率更好，因為我們有 20 奈米的基礎。

So as we have said many times, we don't want to separate 20 versus 16 and always -- you guys always ask 20 margin and 16 margin separately. So I would say if we combine 16 and 20 margin, it will be a pretty good progress. And we have seen 20 has progressed quite well and 16 will be even better.

因此，正如我們多次說過的那樣，我們不想將 20 與 16 分開，而且你們總是分別詢問 20 的利潤率和 16 的利潤率。所以我想說，如果我們將 16 和 20 的利潤結合起來，這將是一個相當不錯的進展。我們已經看到 20 已經取得了相當好的進展，而 16 將會更好。

So although this 20 plus 16 will still have some small dilution to TSMC in the year in 2015 and 2016, for 2015 maybe 2 to 3 percentage point, in 2016 will be 1 to 2 percentage points, but we are targeting to achieve corporate level margin by year 2017.

因此，儘管這20加上16對台積電在2015年和2016年仍然會有一定的稀釋，2015年可能為2到3個百分點，2016年將是1到2個百分點，但我們的目標是在2017年實現公司水平的利潤率。

Okay. Thank you. And then just as a quick follow-up on that, does 20-nanometer still grow from its lower level in the first quarter sequentially? Will it -- in absolute dollar terms, can you maintain the current level throughout the year? I think you've implied that in your guidance. I think you said mid-single digit, just to confirm that. And is that throughout the year? Does 20 stay at about 15% of revenue throughout the year?

好的。謝謝。然後作為對此的快速跟進，20 奈米是否仍會從第一季的較低水平開始連續增長？以絕對美元計算，您能否在全年維持現有水準？我認為您已在您的指導中暗示了這一點。我認為您說的是中等個位數，只是為了確認這一點。全年都是這樣嗎？20是否全年維持在收入的15％左右？

Dan, would you please repeat your question again?

丹，你能再重複你的問題嗎？

Do you think 20-nanometer will remain at the current revenue level throughout the year? Given that some customers are not successful in 20 products and maybe didn't succeed and some customers are more successful. So if you put everything together, I'm wondering if 20 stays at the current revenue level.

您認為 20 奈米全年的收入水準會維持現狀嗎？假設有些客戶在 20 種產品中都沒有成功，甚至可能沒有成功，而有些客戶則比較成功。因此，如果把所有因素放在一起，我想知道 20 是否能保持在目前的收入水準。

In my statement I say that contributing 20% revenue cannot hold because of our customers' demand. But I also say that second quarter we continue to increase the 20-nanometer business, so that means in the second half, no, we cannot maintain that same level of business.

我在聲明中說，由於客戶的需求，貢獻 20% 的收入是無法實現的。但我也說過，第二季我們將繼續增加 20 奈米業務，所以這意味著在下半年，我們無法維持相同的業務水平。

In dollar terms.

以美元計算。

In dollar terms.

以美元計算。

Okay, cannot. Okay. And then my second question is relating to 20-nanometer. Here you certainly have a lot of growth in 16, with customers taping out aggressively, especially next year. Given your high share at 28, how do you keep 28 full? You obviously have a lot of technology there. Customers will move forward.

好的，不能。好的。我的第二個問題與 20 奈米有關。隨著客戶積極退出，尤其是明年，16 月肯定會有很大的成長。鑑於您 28 人的高份額，您如何讓 28 人保持充實？你們顯然擁有很多技術。顧客將會繼續前進。

So I'm wondering, could you elaborate on new areas that are actually creating new demand at 28, such that you can continue to grow 28 next year. And do you think you can grow? I think previously you said maybe hold it at current levels even with 16 growing. So just maybe revisit that question. Thank you.

所以我想知道，您能否詳細說明實際上在 28 上創造新需求的新領域，以便明年您可以繼續實現 28 的成長。你認為你能夠成長嗎？我想您之前說過，即使增長 16%，也許也會將其保持在當前水平。因此也許可以重新檢視這個問題。謝謝。

Okay. To answer the question, I think the high-end smartphone will move to 16 FinFET. However, the mid- to -- and lower-end smartphones will stay in the 28-nanometer because that's very cost effective. And mid- and low-end smartphone continues to grow significantly. So that will give a very strong demand on 28-nanometer. In addition, we still have a second-wave product, like RF and Flash controller, as I use as an example, move into 28-nanometer.

好的。回答這個問題，我認為高階智慧型手機將轉向 16 FinFET。然而，中階和低階智慧型手機仍將保留 28 奈米工藝，因為該工藝非常具有成本效益。中低階智慧型手機持續大幅成長。因此這將對 28 奈米產生非常強勁的需求。此外，我們還有第二波產品，像是RF和Flash控制器，我以它為例，已經進入28奈米時代。

So summing it up, I think the 28-nanometer's demand continue to grow while we move into the 16 FinFET for high-end smartphone.

總而言之，我認為隨著我們轉向用於高階智慧型手機的 16 FinFET，28 奈米的需求將繼續增長。

Excellent. Thank you. And is there an element of -- as you add value on 28-nanometer -- as you add value, is there an element of being able to hold pricing there because it's an old node and all the old nodes face pricing pressure. And I think we get a lot of questions from investors on old nodes getting pricing pressure. But at the same time you're adding a lot of value there. So maybe give us a little bit of sense of the 28-nanometer kind of pricing environment next year. Thank you.

出色的。謝謝。隨著 28 奈米技術的增值，是否存在能夠維持定價的因素，因為它是一個舊節點，所有舊節點都面臨定價壓力。我覺得投資人對我們提出的許多關於舊節點定價壓力的問題表示質疑。但同時，你也在那裡增加了許多價值。所以也許可以讓我們稍微了解一下明年 28 奈米的定價環境。謝謝。

All I can say is we remain more competitive -- very competitive in our value proposition. That gives you some idea about the capacity support, the yield and performance and also including pricing. But all combined together, we are better than the competitor.

我只能說，我們的價值主張仍然更具競爭力──非常有競爭力。這會讓您對容量支援、產量和性能以及定價有所了解。但綜合起來，我們比競爭對手更優秀。

All right. Next the questions will be coming from Deutsche Bank's Michael Chou.

好的。接下來的問題來自德意志銀行的 Michael Chou。

Hi. Two questions. First one is for EUV. As Mark has highlighted your EUV program, Does that imply you may consider using EUV in the second stage of your 16-nanometer -- 10-nanometer ramp-up, potentially in 2018 or 2019? Thank you.

你好。兩個問題。第一個是EUV。正如馬克所強調的您的 EUV 計劃，這是否意味著您可能會考慮在 16 奈米至 10 奈米生產的第二階段使用 EUV，可能在 2018 年或 2019 年？謝謝。

Yes, we always look for opportunity to insert EUV in both 10-nanometer and 7-nanometer. The EUV technology provides not only some cost benefit, but also simplify the process. That means you can replace multiple layers with one layer that helps your yield improvement. So there's opportunity both in quality and cost always exist so long as EUV's productivity comes to the threshold point.

是的，我們一直在尋找在 10 奈米和 7 奈米中插入 EUV 的機會。EUV技術不僅提供了一些成本效益，而且還簡化了流程。這意味著您可以用一層替換多層，有助於提高產量。因此，只要 EUV 的生產效率達到門檻點，品質和成本方面就始終存在機會。

And in -- as you noticed on 10-nanometer, our capacity build will largely done in 2016 and 2017. So 2018 will be inserted, if inserted, will be combined with some other tools upgrade, some tool upgrade to 7, for example, and replaced by the EUV tools. In that node it will not be a fresh capacity build with EUV at that time because that's a little bit late in the schedule for the 10.

正如您所注意到的，在 10 奈米方面，我們的產能建設將主要在 2016 年和 2017 年完成。所以2018年會插入，如果插入的話，會結合一些其他工具的升級，比如說一些工具升級到7.0，並且換成EUV工具。在那個節點上，那時不會用 EUV 進行新的容量建設，因為這在 10 的計劃中有點晚了。

7-nanometer, of course it will be higher probability adopting EUV. And the benefit will be bigger because the 7-nanometer has a lot of multiple layers, quadruple, even multiple patterning layers, thus EUV can be more effective in reducing the cost and improve the yield, for example. So that's our current status.

7奈米，當然採用EUV的機率會更大。而且好處會更大，因為7奈米有很多多層，例如四層，甚至多個圖案層，因此EUV可以更有效地降低成本並提高產量。這就是我們目前的狀態。

But today EUV is still in the engineering mode. The productivity, as you heard, will still have some gaps for practical insertion of the technology. So we're still working on that, in that mode. And we have -- although we have one-day performance up to 1,000 wafer per day, but I was talking about average still a few hundreds. And we need to get to more than 1,000 to consider a schedule to put it into the production.

但目前EUV仍處於工程模式。正如您所聽到的，生產力距離該技術的實際應用仍存在一些差距。所以我們仍在以這種模式進行工作。儘管我們單日產量可達 1​​,000 片晶圓，但平均產量仍只有幾百片。我們需要達到 1,000 以上才能考慮投入生產的時間表。

Thank you. Second question is regarding the outlook by segment. That's for CFO. Outlook by segment in Q2.

謝謝。第二個問題是關於各細分領域的展望。這是給財務長的。第二季各細分領域的展望。

Q2?

問2？

Yes.

是的。

Okay. Q2, I have just said, there will be 7% to 8% decline. I think mainly it's in -- from communications segment. As you can see in my presentation, communication, industrial and standard, both segments constitute about 80% of TSMC revenue. So the decline mainly come from those two segments.

好的。Q2，我剛剛講了，會有7%到8%的下降。我認為主要在於──來自通訊領域。正如大家在我的演示中所看到的，通訊、工業和標準這兩個部門佔台積電收入的 80% 左右。因此，下降主要來自這兩個部分。

Thank you.

謝謝。

All right. Next we will -- the questions will be coming from UBS, Eric Chen.

好的。接下來我們——問題來自瑞銀的 Eric Chen。

Hi, Mark, C.C. Wei, Lora and Elizabeth. Okay. My first question probably go to Lora regarding to the CapEx. You just mentioned we cut the CapEx by $1b but we will maintain our capacity schedule. How about for the 28-nanometer process in terms of the capacity, in terms of the CapEx for the 28-nanometer process? The schedule is going to change?

你好，馬克，C.C.魏、勞拉和伊麗莎白。好的。我的第一個問題可能是問 Lora 的，關於資本支出。您剛才提到，我們削減了 10 億美元的資本支出，但我們將維持我們的產能計畫。就產能而言，28 奈米製程的資本支出如何？日程安排要改變嗎？

We only spent very little money on 28, especially in the first half, to add capacity. In addition to that then we have continued productivity improvements. So on overall year, 28 capacity will still grow.

我們只在28號機上花了很少的錢，特別是在上半年，來增加容量。除此之外，我們還持續提高生產力。因此從全年來看，28 的運力仍將成長。

How many percent year-on-year growth are we talking about?

我們談論的同比增長率是多少％？

Well I will not specify the percentage, but it's still growing with the combination of both.

好吧，我不會具體說明百分比，但兩者結合後它仍然在增長。

Okay. To maintain the original schedule, right?

好的。保持原定的日程吧？

Yes.

是的。

Okay. How about the depreciation growth given we cut the $1b CapEx?

好的。如果我們削減了 10 億美元的資本支出，折舊成長情況如何？

I think I have said in last quarter we expect total depreciation will be -- increase will be around 20%. With this $1b cut down, the increase will be in high teens, will not be 20%.

我想我上個季度就說過，我們預計總折舊將——增加 20% 左右。隨著這 10 億美元的削減，增幅將達到 10% 左右，而不是 20%。

Okay. High teens. Okay. The other question probably go to Mark or C.C. Wei regarding to the -- our investment in China. Any update or any improvement or any logic behind? And some newspaper talk about we would like to build a fab of our own. So any strategy behind? Thank you.

好的。十幾歲的時候。好的。另一個問題可能應該問馬克或 C.C.魏先生談到了我們在中國的投資。有任何更新、改進或背後有什麼邏輯嗎？有些報紙說我們想建立自己的工廠。那麼這背後有什麼策略嗎？謝謝。

Okay. Let me take this one.

好的。讓我來拿這個。

Okay.

好的。

You know we have an 8-inch fab and it's running very well in Shanghai and it's making profit. And we are growing our China business quite nicely in the past few years. Now it accounts about 5% of TSMC revenue. We have seen a very big -- a few big, very big fabless company engaging with TSMC more closely. And we have sales office in the north part, the middle part and southern part of China. So we are participating the China's growth. And we will continue to participate the growth in the future.

你知道我們在上海有一座8吋晶圓廠，它運作得很好，而且還在獲利。過去幾年裡，我們在中國的業務發展相當順利。目前它約佔台積電營收的5%。我們看到一些非常大的無晶圓廠公司與台積電的合作更加密切。並在華北、華中、華南地區設有銷售辦事處。所以我們正在參與中國的成長。而我們將繼續參與未來的成長。

Okay. How about the capacity growth for like 8-inch fab in China?

好的。國內8吋晶圓廠的產能成長如何？

We are aggressively evaluating what's the best way for us to do it.

我們正在積極評估對我們來說最好的解決方法。

Okay. And on your evaluation, what kind of geometry you have put as first priority for your 8-inch fab in China?

好的。並且根據您的評估，對於您在中國的 8 吋晶圓廠，您會優先考慮什麼樣的幾何形狀？

It's probably too detailed. We are still evaluating. We will let you know when we have a better picture. Okay?

可能太詳細了。我們仍在評估。當我們有更好的照片時，我們會通知您。好的？

Okay. Thank you.

好的。謝謝。

All right. Next we will ask Credit Suisse, Randy Abrams, for questions.

好的。接下來我們將向瑞士信貸的蘭迪·艾布拉姆斯（Randy Abrams）提出問題。

Okay. Thank you. The first question, I want to ask about the duration of the pullback because second quarter you're seeing the issue from mobile, but inventory exiting near normal levels. And so to what extent do you see a speed-up in second half? And as you go to fourth quarter, how broad is the customer base? Is it a single key product or are you seeing broadening out of 16 FinFET as you ramp that in fourth quarter?

好的。謝謝。第一個問題，我想問一下回調​​的持續時間，因為第二季你看到了行動端的問題，但庫存接近正常水準。那麼您認為下半年的成長速度會有多大呢？那麼進入第四季度，客戶群有多廣？它是單一關鍵產品嗎，還是隨著您在第四季度加大力度，16 FinFET 將會擴大？

The question -- the second-quarter schedule delay is we see in the mobile product area in several of our customers, so it's not one single customer. But of course there is one single customer impact the most, which is last year to the captive IDMs. As for the second half, we think, first of all, the inventory adjustment will largely complete towards the end of second quarter.

問題是——我們發現第二季度的計劃延遲出現在我們的幾家行動產品領域的客戶中，所以並不是單一客戶。但當然，對一個客戶影響最大，那就是去年對專屬 IDM 的影響。對於下半年，我們認為，首先，庫存調整到第二季末會基本完成。

We think the end market of smartphone is still healthy growth this year. Therefore the second half will resume the growth. And, more importantly, our 16 FinFET technology will start to ramp in the second half. So that will contribute a lot of growth, more than the 20-nanometer shipment reduction. So those two factors.

我們認為今年智慧型手機終端市場仍將健康成長。因此下半年將恢復成長。而且更重要的是，我們的 16 FinFET 技術將在下半年開始加速發展。因此，這將貢獻很大的成長，超過 20 奈米出貨量的減少。所以這是兩個因素。

Okay. And the follow-up question, and I'll ask on the 16, if that's multiple customers contributing this year or if it's a single key product. But the second question I wanted to ask about the internalized silicon, one of the impacts was the -- it's well known now that Samsung ramping up with more of its own silicon. If you could talk about how much is that impact versus the broader smartphone weakness in inventory. And as you look forward, do you see that risk staying with you as far as Samsung, Intel internalizing silicon, the ways you can prevent that or mitigate that risk?

好的。後續問題是，我將在 16 日詢問，今年是否有多個客戶做出貢獻，還是只有單一關鍵產品做出貢獻。但我想問的第二個問題是關於內部化矽的，其中一個影響是——現在眾所周知，三星正在加大對自有矽的生產。您能談談這種影響相對於整體智慧型手機庫存疲軟的影響有多大嗎？展望未來，您是否認為三星、英特爾內部化矽片方面的風險仍然存在，有什麼方法可以防止或減輕這種風險？

Well we definitely see the impact on second quarter, yes. But as far as the future, how that internal captive portion will take away from the foundry, it's really hard to say because each product, they always have some competition considerations. So -- but we are on the -- and also this year the two big smartphone sells very well and that squeezed the Android non-Samsung on non-Apple phones at this point. But that part I think will recover. This is probably a competitive -- competition status in the -- for the period of time only.

是的，我們確實看到了對第二季的影響。但就未來而言，內部專屬部分將如何從代工廠中分走，這真的很難說，因為每種產品總是有一些競爭考慮。所以 — — 但我們也看到 — — 今年兩大智慧型手機的銷量都非常好，這擠壓了非三星 Android 手機和非蘋果手機的市場份額。但我認為那部分會恢復。這可能只是一段時期內的競爭狀態。

So -- but we know that we do not compete with our customers. So the relationship with us and our customer to build the best product to compete is still the best solution seen by many of our customers. And that is we are continuing to work on. And so we will try to produce the best product with our customer to compete.

所以——但我們知道我們不會與客戶競爭。因此，我們與客戶之間建立關係以打造最好的產品來競爭仍然是許多客戶認為的最佳解決方案。這正是我們正在繼續努力的方向。因此我們將努力生產最好的產品與客戶一起競爭。

All right. Next one in line actually is Citi's Roland Shu.

好的。下一位實際上是花旗銀行的 Roland Shu。

Thank you, Elizabeth, Mark, C.C. and Lora. My first question is on given the fast ramp of 16-nanometer, so are we going to see meaningful revenue contribution for 16 in 3Q?

謝謝你，伊麗莎白、馬克、C.C.和洛拉。我的第一個問題是，鑑於 16 奈米技術的快速發展，我們是否會在第三季看到 16 奈米技術帶來有意義的收入貢獻？

We ramp up in third quarter this year, but it's many layers of process, plus about one month is back-end. So in 3Q we expect just the revenue just very minimum.

我們在今年第三季加大了投入，但這是一個多層級的流程，另外還有大約一個月的後端時間。因此，我們預計第三季的營收將非常低。

Okay. But we will start reporting 16-nanometer revenue from 3Q?

好的。但是我們會從第三季開始報告 16 奈米收入嗎？

Yes.

是的。

Okay. Thank you. And with this faster ramp on 16-nanometer, so how do you think about your 16-nanometer overall market share this year? Are we going to see a bigger market share than our major competitor on the 16-nanometer this year?

好的。謝謝。隨著 16 奈米技術的快速發展，您認為今年 16 奈米技術的整體市佔率如何？今年我們在 16 奈米領域的市佔率是否會比主要競爭對手更大？

I only can say that it's better than we expected.

我只能說它比我們預期的還要好。

Okay. Okay. Thank you. And my second question is Intel cut CapEx this year, and also we are talking about -- we are also lower CapEx spending by $1b by converting more 20-nanometer to 16-nanometer. And I think this is ASML also today, they also say this is a rising trend to convert the N+1 node to N-1 -- N-1 to N+1 going forward. So the question is will this trend continue whether or not this year CapEx spending is peaking out in the near term to TSMC, the overall CapEx spending? Because I didn't -- Mark also said for 7-nanometer we probably are also going to need similar tool as 10-nanometer as well. So with this continue tool conversion, whether or not the CapEx spending is peaking out this year. Thank you.

好的。好的。謝謝。我的第二個問題是英特爾今年削減了資本支出，而且我們還在談論——透過將更多的 20 奈米轉換為 16 奈米，我們還將降低 10 億美元的資本支出。我認為今天 ASML 也是一樣，他們也說將 N+1 節點轉換為 N-1——從 N-1 到 N+1 是一個上升趨勢。所以問題是，無論今年的資本支出是否在短期內達到台積電整體資本支出的峰值，這種趨勢是否會持續下去？因為我不知道——馬克還說，對於 7 奈米，我們可能也需要與 10 奈米類似的工具。因此，隨著這種持續的工具轉換，資本支出今年是否達到高峰。謝謝。

It's probably too early to say that, peaking out, because we are still ramping our 16-nanometer and we're going to spend more money next year in 16. Go above 7 nanometer and we will continue to spend money. So I won't say it's peaking up for now.

現在說這個可能還為時過早，因為我們仍然在推進 16 奈米技術，而且明年我們將在這方面投入更多資金。超過 7 奈米我們將繼續投入資金。因此我現在不會說它正在達到頂峰。

Okay. So how about the capital intensity? What's the longer-term view or target for the capital intensity?

好的。那麼資本密集度如何？資本密集度的長期觀點或目標是什麼？

What I can say now is capital intensity came down from previous year close to 50% to a 40% range. And at least for now I can see we will at the 40% range. But more specific will have to be wait for later time.

我現在可以說的是，資本密集度比前一年下降了近 50%，降至 40% 左右。至少現在我認為我們將處於 40% 的範圍內。但更具體的還要等到稍後才能知道。

All right. Also in the order of questions received, I have to go to Morgan Stanley's Bill Lu.

好的。另外，按照收到問題的順序，我必須去找摩根士丹利的 Bill Lu。

Yes. Hi. Good afternoon. Thanks for taking my question. This is a follow-up to Randy's question. But I'm going to go over some numbers with you first before I ask the question, which is we did the math. I don't think these are exactly right. But over the last five years we've got IDM zero growth, fabless 8%, but system houses above 20%, right. So system houses, I'm excluding memory, just the system LSI, the logic portion. I think that might be slightly conservative.

是的。你好。午安.感謝您回答我的問題。這是對蘭迪問題的後續回答。但在提問之前，我要先跟你討論一些數字，也就是我們做的計算。我認為這些並不完全正確。但在過去五年裡，IDM 零成長，無晶圓廠成長 8%，但係統公司成長超過 20%，對吧。所以系統外殼，我排除了內存，只包括系統 LSI，即邏輯部分。我認為這可能稍微保守一些。

Now that's a pretty big change. And I'm wondering how you should think about that, how you should -- if you look at TSMC addressing the system houses versus the fabless customers, if you look at, for example, your market share, if you look at your margin for the system houses versus the fabless, how do you think about that? Thank you.

這是一個相當大的變化。我想知道您應該如何看待這個問題，您應該如何看待台積電針對系統公司與無晶圓廠客戶的情況，如果您看看您的市場份額，如果您看看系統公司與無晶圓廠客戶的利潤率，您如何看待這個問題？謝謝。

Yes. Indeed, in the past five years the system houses sourcing and foundry business to us has a much higher growth rate, as you quoted. But remember, that came from a very small base. Okay? But we welcome system house sourcing because we consider them are fabless too, fabless companies, the companies without fabs, bring business to us.

是的。確實，正如您所說，在過去五年中，系統房屋採購和代工業務對我們來說有著更高的成長率。但請記住，這是從一個非常小的群體中獲得的。好的？但我們歡迎系統公司採購，因為我們認為他們也是無晶圓廠的，無晶圓廠公司，沒有晶圓廠的公司，為我們帶來了業務。

It's not necessarily the margin has to do with what type of company sourced. It has to do with our value to that company and also the size, the size of the business. If the business is bigger, of course the -- we probably can enjoy a slightly -- a little bit better price. So it depends on the size of the business, less dependent on what company, system company or non-system company's business.

利潤率不一定與來源公司的類型有關。這與我們對該公司的價值以及業務規模有關。如果生意更大，當然我們可能會享受稍微好一點的價格。所以這取決於業務的規模，而較少取決於是什麼公司、體係還是非系統公司的業務。

I guess my question is pretty simple, which is when the fabless is outgrowing the industry, it's easy for me to understand that foundry's going to benefit, right? When the system houses outgrowing the industry, some of them have their own fabs. And so is it a positive or negative?

我想我的問題很簡單，那就是當無晶圓廠的發展超越產業時，我很容易理解代工廠將會受益，對嗎？當系統廠商的發展超越產業時，有些廠商就會擁有自己的晶圓廠。那麼它是積極的還是消極的呢？

I'm sorry, system company, someone --?

抱歉，系統公司，有人──？

For example, you had said earlier that one of your customers lost market share to an internal solution. I'd consider that to be a system house as well, right? So overall system house could be in IDM or they might outsource.

例如，您之前說過，您的一個客戶由於內部解決方案而失去了市場份額。我也認為那是一個系統公司，對嗎？因此，整體系統公司可能屬於IDM，或者他們可能會外包。

Okay. Our system houses are considered fabless system houses, what you just quoted. Mainly it's the fabless system houses. We have very little business from the system houses with their own fabs.

好的。我們的系統公司被視為無晶圓廠系統公司，就像您剛才引用的那樣。主要是無晶圓廠系統公司。我們與擁有自己晶圓廠的系統公司幾乎沒有任何業務往來。

Sure. Okay.

當然。好的。

So so long as they're a fabless company, how well the business of that system house depends on their business competition.

所以，只要他們是一家無晶圓廠公司，該系統公司的業務表現如何取決於他們的商業競爭力。

Thank you. I guess we'll take it offline. My second question, and I'm not trying to pin you down, but Mark, you said earlier that the inventory correction and by 2Q and second half of the year will be more normal. Now typical normal seasonality, second half is better than the first half. Are we saying that second half of this year's revenue is going to be higher than the first year -- first half?

謝謝。我想我們會將其下線。我的第二個問題，我並不是想逼你回答，但馬克，你之前說過庫存調整到第二季和下半年會比較正常。現在是典型的正常季節性，下半年比上半年好。我們是不是說今年下半年的收入將高於第一年上半年？

Okay. Yes. That's what we see. Second half this year will be better than first half.

好的。是的。這就是我們所看到的。今年下半年會比上半年好。

Great. Thank you.

偉大的。謝謝。

All right. Next one will be from HSBC's Steven Pelayo.

好的。下一位發言者是匯豐銀行的史蒂芬‧佩拉約 (Steven Pelayo)。

For the last three years or so, TSMC's been growing 20%, 30% year-on-year revenue growth rates. First quarter 50% year on year. But to Bill's question there, it does look like in the second half of the year, if I play around with your full-year guidance and what you're doing, low single-digit year-on-year growth rates. And if we exclude maybe 16-nanometer, above 16-nanometer, maybe it's flat to down. Is that the new industry? What are we talking now for industry growth rates for both the semi industry and in the foundry market this year?

過去三年左右，台積電的營收成長率一直維持在20%、30%左右。第一季較去年同期成長50%。但對於比爾的問題，如果我結合你的全年指導和你正在做的事情，看起來下半年的年成長率將處於低個位數。如果我們排除 16 奈米，那麼 16 奈米以上，它可能就會持平或下降。這是新興產業嗎？我們現在談論的今年半導體產業和代工市場的產業成長率是多少？

So your question is the --?

那你的問題是--？

90 days ago you suggested the semi market was going to grow 5% this year with foundries growing 12%. In light of your new guidance, in light of what it looks like you're going to have very slight year-on-year growth rates in the second half of the year, what do you think that means for the overall industry?

90 天前，您預測今年半導體市場將成長 5%，代工廠將成長 12%。根據您的新指引，考慮到今年下半年您的年成長率似乎將非常小，您認為這對整個產業意味著什麼？

We think the semiconductor growth this year currently is indeed we adjusted down from 5% earlier to 4% at this time. Yes. We think it's really due to the macroeconomic situation around the world today. And therefore the foundry market -- foundry growth rate will adjusted down too. We are looking at about 10% range. So that's why we revised our view on the current semiconductor growth.

我們認為，目前今年的半導體成長率確實是從早期的5%下調到了4%。是的。我們認為這確實歸因於當今全球的宏觀經濟情勢。因此，代工市場－代工成長率也將下調。我們正在觀察大約 10% 的範圍。這就是我們修改對目前半導體成長看法的原因。

I was just trying to get some specific numbers there. For you, Lora, spending $1b less on CapEx is going to help with what already is a pretty good free cash flow story this year. Can you talk a little bit about maybe the free cash flow targets for this year and what you'll do with some of that excess cash? You had $14b in cash but now it sounds like you have an extra $1b coming from a lower CapEx budget too. I think you're going to generate free cash flow that's maybe double your dividend payment this year. Can you talk a little bit about free cash flow goals and dividend plans?

我只是想得到一些具體的數字。對你來說，Lora，減少 10 億美元的資本支出將有助於今年原本就已經相當不錯的自由現金流狀況。您能否談談今年的自由現金流目標以及您將如何處理部分過剩現金？你們有 140 億美元現金，但現在聽起來你們又從較低的資本支出預算中獲得了 10 億美元額外資金。我認為你將產生自由現金流，這可能是你今年股息支付的兩倍。能談談自由現金流目標和股利計畫嗎？

We are confident with our free cash -- capability to generate free cash flow. If we want to use all the money to pay dividend, which is not a good idea, but certainly we have some capability to do so. Our view on dividend is that we need to sustain the level without going down. And we will try our best to maintain that level. So the cash may go up and then we have several ways to consider. Mark was mentioning we have new target for the five years. We want to grow 10% revenue and EPS. And for that we need to continue to invest, also in capacity and also in R&D. So we need to have some bullet to do that too. Okay? Thank you.

我們對我們的自由現金——產生自由現金流的能力充滿信心。如果我們想用所有的錢來支付股息，這不是一個好主意，但我們當然有能力這樣做。我們對股利的看法是，我們需要維持現有水平，不能下降。我們將盡力保持這一水平。因此現金可能會增加，然後我們有幾種方法可以考慮。馬克提到我們有五年的新目標。我們希望營收和每股盈餘成長 10%。為此，我們需要繼續投資，包括產能和研發。所以我們也需要採取一些措施來做到這一點。好的？謝謝。

Can I just quickly add, how much cash do you need on your balance sheet to support a 10% revenue CAGR over the next five years? Is $14b a year -- $14b enough?

我能否快速補充一下，您的資產負債表上需要多少現金來支持未來五年 10% 的複合年收入成長率？每年140億美元——140億美元夠嗎？

It's difficult to make a quantify. It depends on how much we need to spend to keep that 10% growth. So I would not answer this question for now. Okay?

這很難量化。這取決於我們需要花多少錢來維持10%的成長。所以我暫時不會回答這個問題。好的？

All right. I think it's about time for us to actually go to the line. So we will now take our next question from the call. Operator, please proceed with the first caller on the line.

好的。我認為現在是我們真正行動的時候了。我們現在將回答電話會議中的下一個問題。接線員，請繼續接聽線路上的第一位來電者。

Mehdi Hosseini, SIG.

Mehdi Hosseini，SIG。

Thanks for letting me ask a question. Two follow-ups. You talked about converting 20 to 16-nanometer. Can you elaborate on the magnitude of this conversion? And I have a follow-up.

感謝您讓我提問。兩次後續行動。您談到了將 20 奈米轉換為 16 奈米。能詳細說明一下這種轉變的程度嗎？我還有一個後續問題。

Without going too specific, what I can say is early of this year we expect to have more 20 than 16 capacity. Now with the conversion more aggressively, we now see 16-nanometer capacity will be bigger than 20-nanometer for this year.

不用說得太具體，我可以​​說的是，今年年初我們預計容量將超過 20 個，而不是 16 個。現在，隨著轉換更加積極，我們看到今年 16 奈米的產能將大於 20 奈米。

Sure. As this conversion actually takes place, would that impact the installed base of the equipment and therefore would that help you with a one-time positive impact to gross margin?

當然。當這種轉換實際發生時，這是否會影響設備的安裝基礎，從而幫助您對毛利率產生一次性的正面影響？

It -- I don't think it would help our one-time improvement in gross margin. As I said earlier, the two technology nodes share the same facilities. So the depreciation has to go to the two nodes for a period of time. Okay?

我認為這不會幫助我們一次提高毛利率。正如我之前所說，這兩個技術節點共享相同的設施。所以折舊必須在一段時間內轉到兩個節點。好的？

Okay. And then just one quick follow-up on the CapEx cut. What -- can you help me better understand what has happened over the past few months that has given you the confidence that you can reuse the equipment? I imagine the reuse is something that has happened very often in the past. What happened in the past couple of months that made you decide to cut the CapEx?

好的。然後只需快速跟進一下資本支出削減。什麼——您能否幫助我更了解過去幾個月發生的事情，讓您有信心重複使用設備？我想像這種重複使用在過去是經常發生的事情。過去幾個月發生了什麼，促使您決定削減資本支出？

There were two things that made us do this decision. Number one is we did improve our capital efficiency, meaning we are reducing our CapEx per K investment. That's pure savings. Another thing is the conversion faster from 20 to 16 as we see customer migrate to 16 faster than we thought. So there will be some excess capacity for 20-nanometer going forward if we don't do it.

有兩件事促使我們做出這個決定。首先，我們確實提高了資本效率，這意味著我們正在降低每千元投資的資本支出。這是純粹的儲蓄。另一件事是從 20 到 16 的轉換速度更快，因為我​​們看到客戶遷移到 16 的速度比我們想像的要快。因此，如果我們不這樣做的話，未來 20 奈米的產能就會過剩。

It's not a magic, and at the very beginning we know these two nodes has very, very high commonality in equipment. The commonality is about 95%. So it's just a matter of timing, what's the timing to do this transition. And we decided to do it now.

這不是一個魔術，一開始我們就知道這兩個節點在裝置上有非常非常高的通用性。共同性約為95%。所以這只是一個時間問題，什麼時候才會進行這個轉變？我們決定現在就這麼做。

Great. Thanks so much.

偉大的。非常感謝。

All right. We will continue on the line. Operator, please have the next caller on the line.

好的。我們將繼續前進。接線員，請接聽下一位來電。

Brett Simpson, Arete Research.

Arete Research 的 Brett Simpson。

Yes. Thanks very much. My question on 10-nanometer, I know it's still 18 months away from ramp-up, but can you talk about how fast this ramp might scale relative to 20-nanometer or 28-nanometer?

是的。非常感謝。我的問題是關於 10 奈米的，我知道距離量產還有 18 個月的時間，但您能否談談相對於 20 奈米或 28 奈米，這一量產的速度會有多快？

And as you ramp up 10-nanometer for high-end smartphones, would you expect low-end smartphones to start migration from 28 with 16 FinFET in 2017? Thank you.

隨著高階智慧型手機採用 10 奈米工藝，您是否預計低階智慧型手機將在 2017 年開始從 28 奈米 FinFET 遷移到 16 奈米 FinFET？謝謝。

All right. So, Brett, we just want to make sure we hear you correctly. Your question seems to say that if we ramp 10-nanometer in the future, which will be targeting the high-end smartphone, will the low-end smartphone be migrating from 28-nanometer into 16-nanometers. Is that your question?

好的。所以，布雷特，我們只是想確保我們聽清楚了你的意思。您的問題似乎是說，如果我們未來採用 10 奈米工藝，瞄準高端智慧型手機，那麼低端智慧型手機是否會從 28 奈米遷移到 16 奈米。這是你的問題嗎？

Yes. And just to add to that, Elizabeth, how quickly will 10-nanometer scale up relative to the scaling of 20-nanometer -- the ramp-up of 20-nanometer and 28? Will it be as fast?

是的。另外，伊莉莎白，相對於 20 奈米的擴展（20 奈米和 28 奈米的擴展），10 奈米的擴展速度有多快？會一樣快嗎？

Okay. All right. So the profile of the 10-nanometer ramp, will that be steeper than the profile of the 20 or the 28-nanometer?

好的。好的。那麼 10 奈米斜坡的輪廓會比 20 或 28 奈米的輪廓更陡峭嗎？

Yes.

是的。

Yes. Thank you.

是的。謝謝。

Okay. The first part of the question has to do with 10-nanometer ramp for the high-end smartphone, will the mid/low-end move to 16? I think we -- this is up to our customers' product portfolio. We definitely know a lot of customer is looking at 28-nanometer to use -- to do as the low end. But the specification, the smartphone processor specification changes constantly. So what portion of that product will move to 16-nanometer? We think definitely there are some portion, but how a big portion really depends on their product strategy.

好的。問題的第一部分與高階智慧型手機的 10 奈米製程有關，中低階智慧型手機會轉向 16 奈米製程嗎？我認為這取決於我們客戶的產品組合。我們確實知道很多客戶正在考慮使用 28 奈米作為低階產品。但是規格，智慧型手機處理器的規格不斷變化。那麼該產品中有多少部分將轉向16奈米？我們認為肯定有一部分，但具體佔多大比例，確實取決於他們的產品策略。

On the 10-nanometer ramp, I wouldn't say it's bigger. But at least it's similar scale of our ramp as we do in 16 and as we do in 20.

在 10 奈米坡道上，我不會說它更大。但至少我們的坡道規模與我們在 16 年和 20 年的坡道規模相似。

Great. Thank you. And let me just have a follow-up here. There's been a lot of talk in the industry about one of your larger customers planning to introduce a new application processor on both Samsung's 14-nanometer process as well as your 16 FinFET for the same chip later this year. And we haven't really seen a single chip get taped out on two new processors at the same time before in the industry.

偉大的。謝謝。請允許我在此進行後續跟進。業界有很多傳言稱，你們的一家大客戶計劃在今年稍後在同一晶片上推出一款採用三星 14 奈米製程和 16 FinFET 製程的新應用處理器。在業界，我們還沒有真正見過一款晶片同時搭載兩種新處理器的情況。

So my question, how does this really work between the two foundries? Does it mean that that one customer can adjust dynamically, month to month, how they allocate wafers between you and Samsung? Or am I -- or how might this work? Thank you.

所以我的問題是，這兩家代工廠之間究竟是如何運作的呢？這是否意味著一個客戶可以逐月動態調整如何在您和三星之間分配晶圓？或者我——或者這怎麼可能起作用？謝謝。

Brett, I think I tried to understand your question while the photographer's camera is very noisy here. Okay. So your question seems to say that there is a customer that appeared to be working with two different foundries on the 14 and 16-nanometer node. And the products are about to arrive. You would like to understand how this customer will be allocating month by month the -- what's the production or the orders with both of the two foundries. Is that your question?

布雷特，我想我已經嘗試理解你的問題了，但攝影師的相機在這裡噪音很大。好的。所以你的問題似乎是說有一位客戶似乎正在與 14 奈米和 16 奈米節點上的兩家不同的代工廠合作。且產品即將抵達。您想了解該客戶將如何逐月分配兩家鑄造廠的產量或訂單。這是你的問題嗎？

Yes, that's right. Whether they can move around dynamically how they allocate wafers. That's right.

是的，沒錯。他們是否可以動態地調整晶圓的分配方式。這是正確的。

Well my answer is very typical. Our 16 FinFET is really very competitive. And we did not know that customer going to -- how they're going to allocate. I cannot even make any comment on that.

我的回答非常典型。我們的16 FinFET確實非常有競爭力。而且我們不知道客戶將如何分配。我對此甚至無法發表任何評論。

So, Brett, did you hear the answer?

那麼，布雷特，你聽到答案了嗎？

Yes.

是的。

Okay.

好的。

Maybe instead if I can perhaps just ask, you previously said 16 FinFET will be high percent of -- high single-digit percent of sales in Q4. What's the latest update on that?

或許我可以問一下，您之前說過 16 FinFET 將佔第四季度銷售額的高百分比 - 高個位數百分比。最新進展是什麼？

All right. I think that question has already been asked earlier, that I think it was Andrew, right? Yes. He -- Andrew suggested that whether it will be 12%, right?

好的。我認為這個問題之前已經問過了，我認為是安德魯，對嗎？是的。他——安德魯建議是否會是 12%，對嗎？

Thank you.

謝謝。

Okay. Now we come back to the floor. Next the questions will be coming from Goldman Sachs, Donald Lu.

好的。現在我們回到討論現場。接下來的問題來自高盛的 Donald Lu。

(Spoken in foreign language). My first question is about InFO. Just to confirm you said by Q3 next year the quarterly revenue from InFO will be $100m? And also -- Q4, sorry. What would be the gross margin for this business and also how many customers you have? So that's question number one.

（用外語說）。我的第一個問題是關於 InFO。只是想確認一下，您說到明年第三季度，InFO 的季度收入將達到 1 億美元嗎？還有 —— Q4，抱歉。該業務的毛利率是多少？您有多少個客戶？這是第一個問題。

The question number two is I think Mark talked about 10-nanometer and 7-nanometer. Will TSMC offer 8-nanometer similar to 20-nanometer? Thank you.

第二個問題是，我認為馬克談到了 10 奈米和 7 奈米。台積電是否會提供與20奈米類似的8奈米？謝謝。

Well on InFO, you asked about what is the margin. The margin is line with the TSMC's back-end business. That I can say. I'm pretty sure for that.

嗯，在 InFO 上，您詢問利潤是多少。利潤率與台積電的後端業務一致。我可以這麼說。我非常確定這一點。

And how many customers, that I cannot tell you. Many.

至於有多少顧客，我無法告訴你。許多。

So you will have more than one customer next year?

那麼明年您將有多位客戶嗎？

Yes.

是的。

Thank you.

謝謝。

To answer your question, we will not offer 8-nanometer.

回答你的問題，我們不會提供 8 奈米。

Okay. Next we'll go to JPMorgan's Gokul.

好的。接下來我們來談談摩根大通的 Gokul。

Thanks for taking my question. First of all on 16-nanometer, since Dr. Wei mentioned that next year a lot of demand on entry-level to mid-end smartphone is still going to stay at 28-nanometer, could you talk about your visibility for second-wave demand for 16-nanometer?

感謝您回答我的問題。首先關於16奈米，由於魏博士提到明年許多入門級到中階智慧型手機的需求仍將停留在28奈米，您能否談談對16奈米第二波需求的預見？

And a related question would be would your combined 20/16-nanometer capacity plan, as it stands right now, how much below 28-nanometer would it be or it would be at the same level of whatever you built for 28-nanometer in the last five years? Thanks.

一個相關的問題是，就目前的情況來看，您合併後的 20/16 奈米產能計劃會比 28 奈米低多少，或者會與您過去五年為 28 奈米建造的產能處於同一水平嗎？謝謝。

So you talk about the second wave for 16 FinFET?

那麼，您談論的是 16 FinFET 的第二波浪潮嗎？

Yes. What is the visibility that you have? Is it going to be really strong? Because you mentioned that a lot of the cost-sensitive customers would still stay on 28, at least for next year.

是的。您的能見度如何？它會變得很強大嗎？因為您提到許多對成本敏感的客戶至少明年仍會留在 28 號。

Okay. For 28-nanometer I said mid to low end this year that, and next year probably, that smartphone will stay in 28-nanometer because it's very cost-effective and performance-wise is very good. For 16 FinFET I think that people will start to move with their product plan and some of the mid-end smartphone will move into 16-nanometer. That's for sure.

好的。對於 28 奈米，我說今年是中低階，而明年可能，智慧型手機仍將採用 28 奈米，因為它的成本效益很高，而且性能非常好。對於 16 FinFET，我認為人們將開始轉變他們的產品計劃，並且一些中階智慧型手機將轉向 16 奈米。這是肯定的。

In addition to that, we also see improving our 16 FinFET ultra-lower-power Mark just mentioned. And that will have a lot of application. And every product, lower power consumption is one of that advantage. And so that would be our second wave of 16 FinFET.

除此之外，我們也看到了剛才提到的16 FinFET 超低功耗Mark的改進。這將會有很多應用。對每款產品來說，較低的耗電量就是其中一個優勢。這將是我們的第二波 16 FinFET。

Okay. Just wanted to add on to that, so when you think about capacity planning for 20 combined with 16 or 16 right now, given that you've accelerated conversion, would you be building similar level of capacity as 28 that you built over the last three, four years?

好的。我只是想補充一下，當您考慮 20 與 16 或現在 16 相結合的產能規劃時，考慮到您已經加速了轉換，您是否會構建與過去三、四年內構建的 28 類似的產能水平？

Well that is too early to say right now. But we expect 16 FinFET is a long-lasting node and very similar to 28-nanometer.

嗯，現在說這個還太早。但我們預期 16 FinFET 是一個持久的節點，與 28 奈米非常相似。

Okay. Thank you.

好的。謝謝。

All right. Dan Heyler has a follow-up question. Dan.

好的。Dan Heyler 有一個後續問題。擔。

Thank you, Elizabeth. So on 16, this FinFET compact which is getting introduced, when would we expect to see that in volume production?

謝謝你，伊麗莎白。那麼，16 日推出的這款 FinFET 緊湊型產品，我們什麼時候可以預期實現量產？

16 FinFET?

16 FinFET？

Compact FFC?

緊湊型 FFC？

FFC.

FFC。

FFC? That will be ready next year. And we expect that high-volume production starts probably two years later. That's year 2017. 2018 will reach the high volume.

FFC？明年就可以準備好了。我們預計大概兩年後才開始大量生產。那是 2017 年。2018年將達到高峰。

Okay. So is there a -- so the cost-down version for mid-end phones FinFET that you alluded to, plus low power, when is that available?

好的。那麼，有沒有您所提到的適合中階手機 FinFET 的成本降低版，而且功耗更低，什麼時候可以上市？

Probably in 2017 second half.

大概是2017年下半年。

Okay. Great. And then on just number of customers that are in volume production in the third quarter and fourth quarter of 16 FinFET, just the number of customers that are in volume production.

好的。偉大的。然後，關於第三季和第四季投入量產的 16 FinFET 的客戶數量，僅是投入量產的客戶數量。

You ask a very specific question now. We have a few customers in the volume production, but not as -- I cannot tell you it's 10, 20 or -- I cannot say. No.

您現在問了一個非常具體的問題。我們有幾個客戶在進行量產，但是——我不能告訴你是 10 個，20 個還是——我說不出來。不。

A few meaning three?

幾個意思是三個嗎？

Too specific.

太具體了。

Thank you very much.

非常感謝。

All right. Michael. Yes.

好的。麥可。是的。

A follow-up question for InFO. As your customer may be concerned about concentration rate for your InFO, is that possible for you to consider outsourcing to -- licensing to OSAT vendor or you will try to do InFO in the long term since you are developing 10-nanometer InFO?

關於 InFO 的後續問題。由於您的客戶可能擔心您的 InFO 的濃度率，您是否可以考慮外包給——授權給 OSAT 供應商，或者您會嘗試長期使用 InFO，因為您正在開發 10 奈米 InFO？

Whether we are going to license this technology out to OSAT, it will all depend on the business. At the beginning, when we ramp it up, of course it will be 100% inside TSMC. After that we will work with customer, see whether the business need or not and whether we work with the OSAT. There is a lot of flexibility and possibilities.

我們是否要將這項技術授權給 OSAT，完全取決於業務。一開始，當我們加大產能時，當然100％在台積電內部進行。之後我們將與客戶合作，看看業務是否需要，以及是否與 OSAT 合作。具有很大的靈活性和可能性。

Well it seems that we have answered everybody's question successfully today. And then that way we will end our conference here. Thank you for coming.

好吧，看來今天我們已經成功回答大家的問題了。這樣，我們的會議就在這裡結束了。感謝您的到來。

Before we conclude, we will -- the replay of this conference will be accessible within three hours from now, transcript will become available 24 hours from now, both of which will be available through TSMC's website at www.tsmc.com.

在結束之前，我們將——本次會議的重播將在三小時內提供，文字記錄將在 24 小時後提供，兩者均可透過台積電網站 www.tsmc.com 取得。

So thank you for joining us today. We hope we will -- you will join us again next quarter. Goodbye.

非常感謝您今天加入我們。我們希望—您能在下個季度再次加入我們。再見。