台積電 ADR (TSM) 2018 Q4 法說會逐字稿

(foreign language) Happy new year to everyone.

（外語）祝大家新年快樂。

Welcome to TSMC's Fourth Quarter 2018 Earnings Conference and Conference Call.

歡迎參加台積電 2018 年第四季度財報電話會議。

This is Elizabeth Sun, TSMC's Senior Director of Corporate Communications and your host for today.

我是台積電企業傳播高級總監 Elizabeth Sun，也是今天的主持人。

Today's event is webcast live through TSMC's website at www.tsmc.com.

今天的活動通過台積電的網站 www.tsmc.com 進行網絡直播。

(Operator Instructions) As this is conference is being viewed by investors around the world, we will conduct this event in English only.

（操作員說明）由於世界各地的投資者都在觀看本次會議，因此我們將僅以英語進行本次會議。

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 fourth quarter 2018 followed by the guidance for the first quarter of 2019.

今天活動的形式如下：首先，台積電高級副總裁兼首席財務官Lora Ho女士將總結我們在2018年第四季度的運營情況，然後是對2019年第一季度的指導。

Afterwards, Ms. Ho and TSMC's CEO, Dr. C.C. Wei, will jointly provide company's key messages.

隨後，何女士與台積電總裁C.C.魏，將共同提供公司的關鍵信息。

Then TSMC's Chairman, Dr. Mark Lu, will host the Q&A session where all 3 executives will entertain your questions.

隨後台積電董事長陸先生將主持問答環節，三位高管將回答您的問題。

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.

對於電話會議的參與者，如果您還沒有新聞稿的副本，您可以從台積電的網站 www.tsmc.com 下載。

Please also download the summary slides in relation to today's earnings conference presentation.

另請下載與今天的財報會議演示相關的摘要幻燈片。

As usual, I would like to remind everyone 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.

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，這些陳述受到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包含的結果存在重大差異。

Please refer to the Safe Harbor notice that appears in our press release.

請參閱我們新聞稿中的安全港通知。

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

現在，我想將麥克風轉給台積電的首席財務官 Lora Ho 女士，以獲得運營摘要和當前季度指導。

Thank you, Elizabeth.

謝謝你，伊麗莎白。

First of all, happy new year, everyone.

首先祝大家新年快樂。

Thank you for joining us today.

感謝您今天加入我們。

My presentation will start with financial highlights as usual for the fourth quarter and a recap of 2018 for the whole year.

我的演講將像往常一樣從第四季度的財務亮點開始，並回顧 2018 年全年。

Then after that, I will provide a guidance for the first quarter.

然後，我將為第一季度提供指導。

Fourth quarter revenue increased 11.3% sequentially to TWD 290 billion as our business benefited from the strong demand for our 7-nanometer technology covering both mobile and high-performance computing applications.

第四季度收入環比增長 11.3% 至 2900 億新台幣，因為我們的業務受益於對涵蓋移動和高性能計算應用的 7 納米技術的強勁需求。

Gross margin increased 30 basis points sequentially to 47.7% reflecting the absence of the virus incident that occurred in the third quarter, an improvement in back-end profitability, higher capacity utilization and the more favorable foreign exchange rate.

毛利率環比增長 30 個基點至 47.7%，這反映了第三季度沒有發生病毒事件、後端盈利能力改善、產能利用率提高以及匯率更有利的情況。

These factors helped offset the unfavorable technology mix.

這些因素有助於抵消不利的技術組合。

Total operating expenses increased by TWD 2.7 billion, thanks to the operating leverage, only represented 10.6% of the revenue versus 10.8% in the prior quarter.

由於經營槓桿，總營業費用增加了 27 億新台幣，僅佔收入的 10.6%，而上一季度為 10.8%。

And operating margin increased by 40 basis points sequentially to 37%.

營業利潤率環比增長 40 個基點，達到 37%。

Overall, our fourth quarter EPS reached $3.86 and ROE was 24.6%.

總體而言，我們第四季度的每股收益達到 3.86 美元，ROE 為 24.6%。

Now let's take a look at revenue by technology.

現在讓我們來看看技術收入。

7-nanometer process technology continued to ramp strongly and accounted for 23% of wafer revenue in the fourth quarter.

7 納米工藝技術繼續強勁增長，在第四季度佔晶圓收入的 23%。

10-nanometer was 6% and the combined 16/20-nanometer contribution accounted for 21%.

10 納米為 6%，16/20 納米的綜合貢獻佔 21%。

Advanced technologies, 28-nanometer and below, accounted for 67% of wafer revenue, up from 61% in the third quarter.

28 納米及以下先進技術佔晶圓收入的 67%，高於第三季度的 61%。

On a full year basis, 7-nanometer contribution reached 9% of wafer revenue in 2018.

按全年計算，2018 年 7 納米貢獻達到晶圓收入的 9%。

10-nanometer was 11%.

10 納米為 11%。

And the combined 16/20-nanometer contributions was 23% of wafer revenue.

16/20 納米的總貢獻佔晶圓收入的 23%。

Advanced technologies accounted for 63% of total wafer revenue, up from 58% in 2017.

先進技術佔晶圓總收入的 63%，高於 2017 年的 58%。

Now let's take a look at revenue contribution by application.

現在讓我們看一下應用程序的收入貢獻。

During the fourth quarter, Communication increased 27%, while Computer, Consumer and Industrial/Standard decreased 2%, 35% and 3%, respectively.

在第四季度，通信增長了 27%，而計算機、消費和工業/標準分別下降了 2%、35% 和 3%。

On a full year basis, Computer, Communication and Industrial/Standard increased 61%, 1% and 3%, respectively; while Consumer decreased 17%.

全年計算，計算機、通信和工業/標準分別增長 61%、1% 和 3%；而消費者下降了 17%。

Moving on to the balance sheet, we ended the fourth quarter with cash and marketable securities of TWD 695 billion, an increase of TWD 91 billion from the last quarter.

轉向資產負債表，我們在第四季度結束時的現金和有價證券為 6950 億新台幣，比上一季度增加了 910 億新台幣。

On the liability side, current liabilities increased by TWD 19 billion.

負債方面，流動負債增加190億新台幣。

On financial ratios, accounts receivable turnover days was 41 days.

財務比率方面，應收賬款周轉天數為 41 天。

Days of inventory decreased 6 days, to 67 days due to stronger wafer shipment during the fourth quarter.

由於第四季度晶圓出貨量增加，庫存天數減少了 6 天，至 67 天。

Now let me make a few comments on cash flow and CapEx.

現在讓我對現金流和資本支出發表一些評論。

During the fourth quarter, we generated about TWD 189 billion cash from operations and spent $114 billion in capital expenditures.

在第四季度，我們從運營中產生了約 1890 億新台幣的現金，並花費了 1140 億美元的資本支出。

As a result, we generated free cash flow of 75 billion and our overall cash balance increased 89 billion to reach 578 billion at the end of the fourth quarter.

因此，我們產生了 750 億美元的自由現金流，我們的整體現金餘額增加了 890 億美元，到第四季度末達到 5780 億美元。

In the U.S. dollar terms, our fourth quarter capital expenditure reached 3.7 billion and a total USD 10.5 billion for the full year CapEx.

以美元計算，我們第四季度的資本支出達到 37 億美元，全年資本支出總額為 105 億美元。

Now I would like to give you a recap of our performance in 2018.

現在我想回顧一下我們在 2018 年的表現。

2018 was another growth year for TSMC as we continue to set new records in both revenue and earnings.

2018 年是台積電的又一個增長年，我們繼續在收入和盈利方面創造新紀錄。

Despite the weakening macroeconomic outlook and demand headwinds in certain end applications, our revenue grew 6.5% year-over-year in U.S. dollar terms and 5.5% in NT dollars terms to reach about TWD 1 trillion.

儘管宏觀經濟前景疲軟和某些終端應用的需求逆風，但我們的收入以美元計算同比增長 6.5%，以新台幣計算同比增長 5.5%，達到約 1 萬億新台幣。

Main contributor was the strong demand for our 7 and 10-nanometer wafers.

主要貢獻者是對我們 7 和 10 納米晶圓的強勁需求。

Gross margin decreased 2.3 percentage points to 48.3% reflecting a lower level of capacity utilization, the unfavorable technology mix and an unfavorable foreign exchange rate during the year.

毛利率下跌 2.3 個百分點至 48.3%，反映年內產能利用率較低、技術組合不利及匯率不利。

Our operating margin decreased 2.2 percentage points to 37.2%, while we continue to increase investment in R&D for 7-nanometer and 5-nanometer technologies.

我們的營業利潤率下降 2.2 個百分點至 37.2%，同時我們繼續增加對 7 納米和 5 納米技術的研發投入。

Our effective tax rate was 11.7% in 2018, which was lower than 13.5% in 2017, due to lower retained earning tax.

由於留存所得稅較低，我們 2018 年的有效稅率為 11.7%，低於 2017 年的 13.5%。

Full year earnings per share was $13.54.

全年每股收益為 13.54 美元。

On cash flow, we generated 574 billion in operating cash flow for the whole year, spent TWD 316 billion or USD 10.5 billion in capital expenditure, leaving $258 billion in free cash flow.

在現金流方面，我們全年創造了5740億的經營現金流，花費了3160億新台幣或105億美元的資本支出，留下了2580億美元的自由現金流。

We also paid TWD 207 billion or $8 per share in cash dividend, which is an increase of 14% from the 2017 level.

我們還支付了 2070 億新台幣或每股 8 美元的現金股息，比 2017 年的水平增加了 14%。

I have finished my financial summary.

我已經完成了我的財務摘要。

Now let's turn to the forecast, first quarter guidance.

現在讓我們轉向預測，第一季度的指導。

Based on the current business outlook, we expect first quarter revenue to be between USD 7.3 billion and USD 7.4 billion representing 22% sequential decline.

根據目前的業務前景，我們預計第一季度收入將在 73 億美元至 74 億美元之間，環比下降 22%。

Based on the exchange rate assumption of USD 1 to TWD 30.6, our first quarter gross margin is expected to be between 43% and 45%.

基於 1 美元兌 30.6 新台幣的匯率假設，我們第一季度的毛利率預計在 43% 至 45% 之間。

And operating margin is expected to be between 31% and 33%.

營業利潤率預計在 31% 至 33% 之間。

This concludes my financial presentation.

我的財務報告到此結束。

Let me follow by making a few comments about the near-term demand and inventory, CapEx, and profitability.

接下來讓我對近期需求和庫存、資本支出和盈利能力發表一些評論。

Now on your trend demand and inventory, we conclude the fourth quarter with revenue of 287.8 billion or USD 9.4 billion in line with the guidance given 3 months ago.

現在根據您的趨勢需求和庫存，我們第四季度的收入為 2878 億美元或 94 億美元，與 3 個月前給出的指導一致。

This result was mainly driven by the continued steep ramp of our industry-leading 7-nanometer technology.

這一結果主要是由我們行業領先的 7 納米技術的持續陡峭增長推動的。

Concluding 2018, semiconductor excluding memory growth was 8%, while foundry grew 6%.

截至 2018 年，半導體（不包括內存）增長 8%，而代工增長 6%。

TSMC's revenue grew 6.5% year-over-year in U.S. dollars mainly due to strong demand for our 7-nanometer technology.

台積電以美元計算的收入同比增長 6.5%，主要是由於對我們 7 納米技術的強勁需求。

Moving into first quarter '19, our business will be dampened by the overall weakening of the macroeconomic outlook, mobile product seasonality and the high level of inventory in the semiconductor supply chain.

進入 19 年第一季度，我們的業務將受到宏觀經濟前景整體疲軟、移動產品季節性和半導體供應鏈中高水平庫存的影響。

Due to the overall softening economic environment, semiconductor supply chain inventory exiting 2018 stay at a much higher level than seasonal.

由於整體經濟環境疲軟，2018 年半導體供應鏈庫存遠高於季節性水平。

We expect the excess inventory in the semiconductor supply chain will take a couple of quarters to digest.

我們預計半導體供應鏈中的過剩庫存將需要幾個季度才能消化。

And the overall supply chain inventory will gradually approach to the seasonal level around the middle of this year.

而整體供應鏈庫存將在今年年中左右逐步接近季節性水平。

Now let me make comments about the CapEx.

現在讓我對資本支出發表評論。

As I have said before, we believe USD 10 billion to USD 12 billion capital budget will be sufficient to support our average growth of 5% to 10% per annum in the next few years.

正如我之前所說，我們相信 100 億美元至 120 億美元的資本預算將足以支持我們未來幾年每年 5% 至 10% 的平均增長。

Given the macroeconomic outlook in 2019, we are tightening this year's capital spending by several hundred million dollars to a level between USD 10 billion to USD 11 billion.

鑑於 2019 年的宏觀經濟前景，我們將今年的資本支出收緊數億美元，至 100 億美元至 110 億美元之間的水平。

That said, our commitment to support customers product ramp remained unchanged.

也就是說，我們支持客戶產品升級的承諾保持不變。

Out of this USD 10 billion to USD 11 billion CapEx for 2019, about 80% of the capital budget will be allocated for other advanced process technologies, which includes 7-nanometer, 5-nanometer and 3-nanometer.

在 2019 年 100 億美元至 110 億美元的資本支出中，約 80% 的資本預算將用於其他先進工藝技術，包括 7 納米、5 納米和 3 納米。

A little more than 10% will be spent for advanced packaging and mask making, and about 10% will be spent for specialty technologies.

超過 10% 將用於先進封裝和掩模製造，約 10% 將用於專業技術。

So this is about CapEx.

所以這是關於資本支出的。

Let me follow by making some comments about profitability.

接下來讓我對盈利能力發表一些評論。

Okay, as I stated in our first quarter 2018, earnings call, I said TSMC's profitability is determined by the following 6 factors: Number one is leadership technology development and ramp up and pricing and cost reduction and capacity utilization and foreign exchange rate and last one is technology mix.

好的，正如我在 2018 年第一季度財報電話會議中所說，台積電的盈利能力取決於以下 6 個因素：第一是領先的技術開發和提升以及定價和成本降低以及產能利用率和匯率，最後一個是是技術組合。

All these factors, except capacity utilization, determine our standard gross margin.

除產能利用率外，所有這些因素都決定了我們的標準毛利率。

I have just guided first quarter gross margin to decline by 3.7 percentage points sequentially at the midpoint of the guidance.

我剛剛指導第一季度毛利率在指導的中點連續下降 3.7 個百分點。

This is primarily attributable to a lower utilization due to the overall weakening macroeconomic environment, the mobile product seasonality and the high level of inventory in the supply chain.

這主要是由於整體疲軟的宏觀經濟環境、移動產品的季節性以及供應鏈中的高庫存水平導致利用率降低。

Due to the recent changes in high-end smartphone business condition, our 7-nanometer capacity will see a substantial cutback on utilization rate in fourth quarter -- in first quarter and second quarter which is expected to hit our gross margin by more than 4 percentage points in each quarter.

由於近期高端智能手機業務狀況的變化，我們的 7 納米產能將在第四季度出現大幅削減——第一季度和第二季度，預計毛利率將下降 4 個百分點以上每個季度的分數。

Going forward, to better manage our leading edge utilization rate, we will be working closely with customers for more effective capacity planning.

展望未來，為了更好地管理我們領先的利用率，我們將與客戶密切合作以進行更有效的產能規劃。

Looking at other profitability factors for 2019, our 7-nanometer ramp-up remains very strong.

從 2019 年的其他盈利因素來看，我們的 7 納米增長仍然非常強勁。

We continue to provide value to customer and drive aggressive cost reduction.

我們繼續為客戶提供價值，並推動積極降低成本。

In the meantime, we are increasing our resource in specialty technologies development to backfill our mainstream capacity technology.

與此同時，我們正在增加我們在專業技術開發方面的資源，以回填我們的主流產能技術。

With all the above factors, we expect our gross margin in the second half of this year will be better than first half.

綜合以上因素，我們預計今年下半年的毛利率將好於上半年。

And we believe our long-term gross margin target of about 50% is still a good target.

我們相信我們 50% 左右的長期毛利率目標仍然是一個不錯的目標。

Thank you for your listening.

謝謝你的聆聽。

Now let me turn the podium to C.C. for his remarks.

現在讓我把講台轉到 C.C.對於他的言論。

Thank you, Lora.

謝謝你，洛拉。

Good afternoon, ladies and gentlemen.

下午好，女士們，先生們。

Let me start with our 2019 full year outlook.

讓我從我們的 2019 年全年展望開始。

We forecast a slowdown in global GDP growth from 3.2% in 2018 to 2.6% in 2019 due to the weakening macroeconomic conditions leading to a low growth for the semiconductor industry.

由於宏觀經濟狀況疲軟導致半導體行業增長緩慢，我們預測全球 GDP 增長將從 2018 年的 3.2% 放緩至 2019 年的 2.6%。

For the full year of 2019 we forecast the overall semiconductor market excluding memory will grow 1% while foundry growth will be flat.

對於 2019 年全年，我們預測不包括內存的整個半導體市場將增長 1%，而代工增長將持平。

For TSMC, we estimate our business will grow only slightly in 2019 given the slowing economic environment.

對於台積電，鑑於經濟環境放緩，我們估計我們的業務在 2019 年將僅略有增長。

Our 2019 business will be supported by the continuing demand for our 7-nanometer where we see strong interests from our customer in high-performance computing, mobile and automotive.

我們 2019 年的業務將受到對 7 納米的持續需求的支持，我們看到客戶對高性能計算、移動和汽車的濃厚興趣。

Even with a slow year like 2019, we firmly believe AI and 5G are the megatrends that will drive the future semiconductor growth.

即使像 2019 年這樣緩慢的一年，我們堅信 AI 和 5G 是推動未來半導體增長的大趨勢。

And we reaffirm our long-term growth projection of 5% to 10% CAGR.

我們重申我們的長期增長預測為 5% 至 10% 的複合年增長率。

Now I will talk about our 5-nanometer status.

現在我將談談我們的 5 納米狀態。

Our N5 technology development is well on track, with customer tapeout schedule for first half 2019 and volume production ramp in first half 2020.

我們的 N5 技術開發進展順利，2019 年上半年客戶流片計劃和 2020 年上半年量產加速。

We are already in preparation for N5's ramp.

我們已經在為 N5 的坡道做準備。

All applications that are using 7-nanometer today will adopt 5-nanometer.

今天所有使用 7 納米的應用都將採用 5 納米。

In addition, we are expecting the customer product portfolio at N5 and see expanding addressable market opportunities.

此外，我們期待 N5 的客戶產品組合，並看到擴大的潛在市場機會。

We expect more applications in HPC to adopt N5.

我們預計 HPC 中的更多應用將採用 N5。

Thus we are confident that N5 will also be a large and long-lasting node for TSMC.

因此，我們有信心 N5 也將成為台積電的一個大而持久的節點。

Now I will talk about the ramp-up of N7 and N7+.

現在我將談談 N7 和 N7+ 的升級。

Our 7-nanometer has been a very steep and successful ramp in second half 2018 and we expect continued ramp through 2019.

我們的 7 納米在 2018 年下半年取得了非常陡峭和成功的增長，我們預計到 2019 年將繼續增長。

Our customer portfolio is growing stronger while more applications such as HPC and automotive are coming to N7 as well.

我們的客戶組合越來越強大，同時 HPC 和汽車等更多應用也將進入 N7。

Customer tapeouts activities at N7 continue to be strong despite the cautious macro outlook.

儘管宏觀前景謹慎，N7 的客戶流片活動繼續強勁。

We are actually seeing an increase in silicon content for AI and 5G-related product designs.

我們實際上看到 AI 和 5G 相關產品設計的矽含量有所增加。

We expect that 7-nanometer to contribute more than 25% of our wafer revenue in 2019.

我們預計 7 納米將在 2019 年貢獻超過 25% 的晶圓收入。

Our N7+ yield rate is progressing well and comparable to N7.

我們的 N7+ 良率進展順利，可與 N7 相媲美。

N7+ volume production is scheduled to begin in second quarter this year.

N7+ 計劃於今年第二季度開始量產。

As I have stated before, we are working with several customers on N7+ to support their second and third wave product designs, and we expect the N7+ price contribution to the 7-nanometer family will grow increasingly larger over the next few years.

正如我之前所說，我們正在與幾家 N7+ 客戶合作，以支持他們的第二波和第三波產品設計，我們預計未來幾年 N7+ 對 7 納米系列的價格貢獻將越來越大。

Now I'll talk about TSMC's mature nodes strategy and our new 8-inch facility.

現在我將談談台積電的成熟節點戰略和我們新的 8 英寸設施。

For mature nodes, our strategy is that we do not increase larger capacity at mature nodes but rather we work with customers to develop specialty technologies that create differentiated and longer-lasting value to customers.

對於成熟節點，我們的策略是不增加成熟節點的更大容量，而是與客戶合作開發專業技術，為客戶創造差異化和更持久的價值。

Our recent plan for an extension at Fab6 in Tainan is a part of this strategy.

我們最近在台南 Fab6 擴建的計劃是這一戰略的一部分。

The extension is not an increase of wafer capacity per se.

擴展並不是晶圓容量本身的增加。

But the purpose is to increase the clean room space for more specialty tools.

但目的是為更多專業工具增加潔淨室空間。

With successful execution of our mature node strategy, we believe we will be able to continually deliver good profitability in the future.

隨著我們成熟節點戰略的成功執行，我們相信我們將能夠在未來持續提供良好的盈利能力。

Finally, I will talk about our most important growth contributor in the next 5 year.

最後，我會談談我們未來 5 年最重要的增長貢獻者。

As I just stated, we believe 5G and AI will be the megatrend underlying the ubiquitous computing which will drive the semiconductor growth in the future.

正如我剛才所說，我們相信 5G 和 AI 將成為推動未來半導體增長的普適計算的大趨勢。

With the successful ramp of 7-nanometer, we are able to expand our customer product portfolio and can add applications related to PC and tablets to the HPC platform.

隨著 7 納米的成功升級，我們能夠擴展我們的客戶產品組合，並將與 PC 和平板電腦相關的應用程序添加到 HPC 平台。

With this inclusion, we believe HPC will become the largest contributor to our business in terms of revenue growth in the next 5 years.

有了這一納入，我們相信 HPC 將成為未來 5 年收入增長方面我們業務的最大貢獻者。

Thank you for your attention.

感謝您的關注。

All right.

好的。

This concludes our prepared statements.

我們準備好的陳述到此結束。

Before we begin the Q&A session, I would like to remind everybody (Operator Instructions) Questions will be taken both from the floor and from the call.

在我們開始問答環節之前，我想提醒大家（操作員說明）問題將在現場和電話中進行。

Should you wish to raise your questions in Chinese, I will translate it to English before our management answers your question.

如果您想用中文提出問題，我會在管理層回答您的問題之前將其翻譯成英文。

(Operator Instructions) .

（操作員說明）。

Now let's begin the Q&A.

現在讓我們開始問答吧。

First question will be coming from Crédit Suisse, Randy Abrams.

第一個問題將來自瑞士信貸蘭迪艾布拉姆斯。

The first question I had was on the guidance both for the sales and the CapEx.

我遇到的第一個問題是關於銷售和資本支出的指導。

You're lowering sales outlook to just slight growth but only making a small change to CapEx.

您將銷售前景下調至僅略有增長，但僅對資本支出進行了小幅更改。

Could you talk about the assumptions you're making for further market share gains or demand recovery?

您能否談談您為進一步增加市場份額或恢復需求所做的假設？

And also the assumptions for 5-nanometer and EUV to keep the CapEx intact.

以及 5 納米和 EUV 的假設，以保持資本支出不變。

Okay.

好的。

Good afternoon.

下午好。

And I want to say happy new year again.

我想再次說新年快樂。

Welcome to the investor conference.

歡迎參加投資者大會。

Your first question, I would like C.C. to answer.

你的第一個問題，我想要 C.C.回答。

You're asking about we've only grow slightly but CapEx did not decrease dramatically.

你問的是我們只是略有增長，但資本支出並沒有大幅下降。

Good question.

好問題。

We now become more conservative on CapEx it's because of we forecast a slower -- a lower 5-nanometer demand at the initial ramp.

我們現在對資本支出變得更加保守，這是因為我們預測會放緩——在最初的斜坡上，5 納米的需求會降低。

However, we still have to prepare enough capacity to support our customers.

但是，我們仍然需要準備足夠的容量來支持我們的客戶。

And we believe that today, with more than few hundred million U.S. dollar is to reflect the reality of expecting the high-end smartphone a little bit slower growth.

而我們認為，今天，超過幾億美元是反映了預期高端智能手機增長放緩的現實。

But this year, this year is because of 7-nanometers of capacity has been built.

但今年，今年是因為7納米的產能已經建成。

And the demand -- actually, we forecast the number of the units of the smartphone, especially high-end smartphone, to be negative growth.

而需求——實際上，我們預測智能手機，尤其是高端智能手機的數量將出現負增長。

Although we are still want to say that.

雖然我們還是想說。

For TSMC, the year-on-year from 2019 compared to 2018, the smartphone -- the mobile business, we still grow slightly on this year regardless if the unit is dropping, okay.

對於台積電來說，從 2019 年到 2018 年的同比，智能手機——移動業務，無論單位是否下降，我們今年仍然略有增長，好吧。

And as a result, we expect -- as I just said, we expect the foundry business will be flat, but TSMC still grows slightly.

因此，我們預計 - 正如我剛才所說，我們預計代工業務將持平，但台積電仍會略有增長。

One follow-up to that and then I'll ask a second question, for that capital spending change you mentioned on EUV, could you talk now about kind of magnitude and steepness?

一個跟進，然後我會問第二個問題，對於你在 EUV 上提到的資本支出變化，你現在能談談幅度和陡峭程度嗎？

Like what type of ramp we should expect next year for that node?

比如我們應該期待明年該節點的坡道類型是什麼？

And on the CapEx, are you making any consideration with the slower environment to reuse more equipment?

在資本支出方面，您是否考慮過使用較慢的環境來重複使用更多設備？

So that's a follow-up to the first question.

這是第一個問題的後續。

Yes, we do expect that we -- in the 5-nanometer we'll use some of the 7-nanometer's equipment.

是的，我們確實希望我們——在 5 納米中，我們將使用一些 7 納米的設備。

To answer your question more correctly actually why it only drop a little bit.

為了更正確地回答您的問題，實際上為什麼它只會下降一點點。

A few hundred million U.S. dollar because of EUV tool actually we already buy a lot, all right?

幾億美元因為 EUV 工具其實我們已經買了很多了，好嗎？

And we expect that will continue to grow also.

我們預計這也將繼續增長。

So the ramp-up of the 5-nanometer now definitely was slower than we expected.

所以現在 5 納米的加速發展肯定比我們預期的要慢。

But we still think it's a long-lasting node because of all our customers who are using 7-nanometer today are engaged with TSMC today in their product design.

但我們仍然認為這是一個持久的節點，因為我們今天使用 7 納米的所有客戶都在與台積電合作進行產品設計。

So and in addition to that, we also increased our product portfolio, our customers' product portfolio.

因此，除此之外，我們還增加了我們的產品組合，我們客戶的產品組合。

And that will add something to HPC application.

這將為 HPC 應用程序添加一些東西。

So look, it's not a very promising in this year but we still have the confidence that 5% to 10% CAGR will be sustained.

所以看，今年不是很有希望，但我們仍然有信心保持 5% 到 10% 的複合年增長率。

A change on the second question, a follow-up 1 more.

關於第二個問題的變化，後續1更。

For the 5-nanometer, if you could just talk a little bit more what's driving some of the change in consideration if it's anything about the EUV readiness versus the cost structure, mature 7 versus 5. Maybe if you could go into if now you expect a bigger 7 initially, what the factor for that is?

對於 5 納米，如果你能多談談是什麼推動了考慮的一些變化，如果它是關於 EUV 準備與成本結構的任何事情，成熟的 7 對 5。也許如果你現在可以進入，如果你期望最初是更大的 7，這是什麼因素？

Let's talk about EUV's readiness.

讓我們談談 EUV 的準備情況。

We are progressing really well.

我們進展得非常好。

So that's why I said the 7+, which is using the EUV, will start production in second quarter this year.

這就是為什麼我說使用 EUV 的 7+ 將在今年第二季度開始生產。

And our 5-nanometer's technology development, a lot are based on the EUV's progress.

而我們5納米的技術發展，很多都是基於EUV的進步。

And 5-nanometer's technology development is on track.

5納米的技術發展正在步入正軌。

So that's 1 thing.

所以這是一件事。

Why we lower down CapEx is because we expect the high-end smartphone's growth will not be as strong as we used to project before, okay?

為什麼我們降低資本支出是因為我們預計高端智能手機的增長不會像我們以前預測的那麼強勁，好嗎？

We lower it down a little bit but still, we still think the high-end smartphone will grow because of 5G and AI's application.

我們稍微降低了一點，但我們仍然認為高端智能手機會因為 5G 和人工智能的應用而增長。

I guess the question was more EUV for it to be slower than original.

我猜這個問題更多的是 EUV，因為它比原來的要慢。

What drove the change to the EUV or to the 5-nanometer?

是什麼推動了 EUV 或 5 納米的變化？

I did not say the EUV will be slower.

我沒有說 EUV 會更慢。

5-nanometer.

5納米。

5-nanometer, no.

5納米，沒有。

It will continue.

它將繼續。

The CapEx this year, majority of it has been on 5, not even 3-nanometer.

今年的資本支出，大部分是 5 納米，甚至不是 3 納米。

EUV's productivity continued to improve.

EUV 的生產力不斷提高。

And that modulate the CapEx we need to invest.

這會調節我們需要投資的資本支出。

So from the number we are very confident that our 5-nanometer will ramp according to our previous plan.

所以從這個數字來看，我們非常有信心我們的 5 納米將按照我們之前的計劃進行。

However, we do put a more conservative, tighten up our CapEx under those confidence to improve the productivity and make sure the lead time is tightened up enough to minimize the CapEx.

但是，我們確實採取了更加保守的措施，在這些信心下收緊我們的資本支出，以提高生產力，並確保交貨時間收緊到足以最大限度地減少資本支出。

Okay.

好的。

Lower 5-nanometer initial ramp though, could you talk about that?

不過，較低的 5 納米初始斜坡，你能談談嗎？

Like the rationale for that lower initial 5-nanometer ramp?

喜歡較低的初始 5 納米斜坡的基本原理嗎？

I just say we expect a higher growth, but right now, we're now a bit more conservative on the high-end smartphones.

我只是說我們預計會有更高的增長，但現在，我們現在對高端智能手機更加保守。

(inaudible)

（聽不清）

Yes.

是的。

Next question will be coming from Citigroup's Roland Shu.

下一個問題將來自花旗集團的 Roland Shu。

First question is, C.C, you said for the mobile business this year, you still expect some growth.

第一個問題是，C.C，你說今年的移動業務，你仍然期待一些增長。

But under your overall year, on the whole year revenue growth just slightly.

但在你全年的總體情況下，全年收入增長只是小幅增長。

So how about the growth of the other platform products: IoT, HPC and automotive?

那麼其他平台產品的增長情況如何：物聯網、高性能計算和汽車？

Okay, Roland, you asked a good question.

好的，羅蘭，你問了一個好問題。

Smartphone grows slightly.

智能手機略有增長。

IoT grows double-digit.

物聯網增長兩位數。

Automotive will be flat.

汽車將持平。

HPC, if we're excluding the cryptocurrency mining, HPC also grows slightly.

HPC，如果我們排除加密貨幣挖礦，HPC 也會小幅增長。

But cryptocurrency is a big drop from 2018 to 2019.

但從 2018 年到 2019 年，加密貨幣大幅下降。

So if we put the cryptocurrency together in the HPC, it's a big drop.

因此，如果我們將加密貨幣放在 HPC 中，這是一個很大的下降。

It's almost a double-digit.

幾乎是兩位數。

May we have more color for the breakdown for these four platforms?

我們可以為這四個平台的細分提供更多顏色嗎？

The revenue breakdown in last year in 2018?

2018年去年的收入明細？

This one maybe, Lora, you can directly answer on the number.

這一個，Lora，你可以直接在號碼上回答。

For 2018, smartphone roughly accounts for 45% of our wafer revenue.

2018 年，智能手機大約占我們晶圓收入的 45%。

HPC, about 30%, 32%.

高性能計算，大約 30%、32%。

IoT, single-digit, 6%; automotive, 5%; digital electronics, 6% and there's other 5% here.

物聯網，個位數，6%；汽車，5%；數字電子產品，6%，這裡還有 5%。

And may I know how big of the contribution for cryptocurrency last year?

我可以知道去年加密貨幣的貢獻有多大嗎？

A lot.

很多。

We don't want to specify too much of the segment, particularly it belongs to one of the big customers.

我們不想指定太多的細分市場，特別是它屬於大客戶之一。

So...

所以...

And the other question is Lora said both 7-nanometer utilization will be dropped a lot in first half.

另一個問題是 Lora 表示，上半年 7 納米的利用率將大幅下降。

But the whole year, the 7-nanometer revenue contribution commented by C.C. will be about 25%.

但全年，C.C. 評論 7 納米的收入貢獻。將約為 25%。

So that means that -- above 25%.

這意味著——超過 25%。

That means the second half, the 7-nanometer contribution will be very strong.

這意味著下半年，7納米的貢獻將非常強大。

So may we have more color?

那麼我們可以有更多的顏色嗎？

What kind of application is driving such a strong 7-nanometer demand?

什麼樣的應用推動瞭如此強勁的 7 納米需求？

Okay.

好的。

A lot of it because of seasonality of the high-end smartphone.

很多是因為高端智能手機的季節性。

So in the second half, we expect to ramp up the high-end smartphone again.

因此，在下半年，我們預計將再次提升高端智能手機。

The first half is a little bit kind of cyclical in the high-end smartphone.

上半年在高端智能手機中有點週期性。

To be honest, this high-end smartphone drop in the first quarter is -- came a little bit sudden.

老實說，第一季度高端智能手機的下滑是有點突然的。

So the inventory in the supply chain is quite a lot.

所以供應鏈中的庫存是相當多的。

So that may push the first half drop.

所以這可能會推動上半年的下跌。

But the second half, we expect the new product launch will carry on another wave of ramp.

但下半年，我們預計新品上市將迎來另一波坡度。

So Roland, I'll give you more color.

所以羅蘭，我會給你更多的顏色。

How about that?

那個怎麼樣？

The second half, we already said that we have more customers' product portfolio.

下半年，我們已經說過我們有更多客戶的產品組合。

So that will expand into the high performance computing.

因此，這將擴展到高性能計算。

Some of the product will enter into production slightly from fourth quarter and extended to the next year.

部分產品將從第四季度開始小幅投產，並延長至明年。

For the 7-nanometer follow-up, I think 7+ will be also included in the whole 7-nanometer.

對於7納米的後續，我覺得7+也會包含在整個7納米里面。

And N7+ total revenue will still be somewhere around the TWD 1 billion.

N7+ 的總收入仍將在 10 億新台幣左右。

That's correct.

這是正確的。

7+ is not a major node, but rather it is a technology good for second wave and third wave customers.

7+ 不是主要節點，而是對第二波和第三波客戶有利的技術。

So it is come up slower when the first wave products or first wave customers ready to convert to the lower -- to another improved version.

因此，當第一波產品或第一波客戶準備轉換為較低的版本時，它會變慢 - 到另一個改進版本。

So it's -- it doesn't conflict with our 5. 5 is another major node.

所以它 - 它與我們的 5 不衝突。5 是另一個主要節點。

Next question will be coming from Goldman Sachs' Bruce Lu.

下一個問題將來自高盛的 Bruce Lu。

So I want to ask about smartphone semi content addressable market.

所以我想問一下智能手機半內容可尋址市場。

TSMC management used to provide semi content for high-end smartphone, medium smartphone and low end smartphone in the past.

台積電管理層過去曾為高端智能手機、中端智能手機和低端智能手機提供半內容。

Can we ask what kind of semi content growth either come in 1 or 2 years with different segments smartphone?

我們能否問一下，不同細分市場的智能手機在 1 年或 2 年內會出現什麼樣的半內容增長？

And also, what kind of semiconductor growth for smartphone movie from 4G to 5G, especially for the addressable market for TSMC?

此外，智能手機電影從 4G 到 5G 會有什麼樣的半導體增長，特別是對於台積電的潛在市場？

You want to specify what is semiconductors' content into the high-end smartphone, actually, you want to narrow down to a specific number just like before, I don't think we could do it today because of there's a lot of application, new application that add into, that's one, such as AI and something.

你想在高端智能手機中指定什麼是半導體的內容，實際上，你想像以前一樣縮小到一個特定的數字，我認為我們今天做不到，因為有很多應用程序，新的添加到其中的應用程序，就是一個，例如AI之類的。

We expect in the future AR/VR will be inside.

我們預計未來 AR/VR 將在裡面。

The second thing is 5G itself will increase a lot in frequency band.

第二件事是5G本身在頻段上會增加很多。

And so that will add the silicon content inside.

這樣就會增加里面的矽含量。

I'll give you a kind of feeling that the smartphone unit will drop a few percentage.

我會給你一種感覺，智能手機單元會下降幾個百分比。

TSMC will still grow the smartphone business.

台積電仍將發展智能手機業務。

So that means there's a lot of increase in that revenue, it's because of silicon content, in terms of the smartphone business.

所以這意味著收入有很大的增長，這是因為智能手機業務方面的矽含量。

But moving to 5G, as you mentioned that there are a lot of RF content those kind of semiconductor increase, do we see that having any impact to our business?

但是轉向 5G，正如你提到的那樣，半導體增加了很多射頻內容，我們認為這對我們的業務有什麼影響嗎？

You could -- you have a good question.

你可以 - 你有一個很好的問題。

Yes, move into 5G, the RF become more complicated.

是的，進入 5G，RF 變得更加複雜。

And so you have larger area in the RF chip.

所以你在射頻芯片上有更大的面積。

And so we expect silicon content per se that will increase.

因此，我們預計矽含量本身會增加。

And so the silicon -- the content in the smartphone will increase.

因此，矽——智能手機中的內容將會增加。

But can we somehow quantify the number?

但是我們能以某種方式量化這個數字嗎？

Not very.

不是特別的。

Let me put some color.

讓我塗點顏色。

I mean, this is based on of course forecast number.

我的意思是，這當然是基於預測數字。

So nothing -- may not be accurate but we have a picture about the silicon content supporting C.C. Wei's description.

所以沒什麼——可能不准確，但我們有一張關於支持 C.C. 的矽含量的圖片。魏的介紹。

On a high-end smartphone, we see the silicon content increase.

在高端智能手機上，我們看到矽含量增加。

Actually it's increased every year, very fast.

實際上它每年都在增加，非常快。

On the mid end, it will increase slightly.

在中端，它將略有增加。

On the low end, it's less predictable, but we take the decrease is slightly.

在低端，它不太可預測，但我們認為下降幅度很小。

So that's the picture.

這就是圖片。

And most of our business in the smartphone is -- belongs to the high-end.

我們在智能手機上的大部分業務都屬於高端。

So we are going to enjoy the silicon content with the equipment of our technology, leading-edge technology.

因此，我們將通過我們的技術，領先技術的設備來享受矽含量。

Okay.

好的。

My second question will be that management just mentioned that 5% revenue growth CAGR will maintain.

我的第二個問題是管理層剛剛提到將保持 5% 的收入增長複合年增長率。

Management first mentioned that in 2017.

管理層在 2017 年首次提到這一點。

And with slow growth in 2019, if you do that after-math, you now expect that more than double-digit growth for the coming 2 years?

在 2019 年增長緩慢的情況下，如果你事後計算，你現在預計未來 2 年的增長將超過兩位數？

You can calculate it.

你可以計算一下。

Do I read it correctly?

我讀對了嗎？

I want to reaffirm that the 5% to 10% that CAGR will sustain, we have confidence on that.

我想重申，複合年增長率將維持在 5% 到 10%，我們對此充滿信心。

And you calculate it.

你計算一下。

So the 5-year is 2017 to 2021, right?

所以這5年是2017年到2021年，對吧？

Yes.

是的。

All right.

好的。

Next question will be coming from CL Securities Sebastian Hou.

下一個問題將來自 CL Securities Sebastian Hou。

My first question is I would like to get TSMC's brains on the overall semi-cycle inventory.

我的第一個問題是，我想讓台積電在整個半週期庫存上動腦筋。

Remember, 3 months ago, the company talked about that you are not too worried about the inventory situation compared to the 4Q '17.

請記住，3 個月前，該公司曾說過，與 17 年第四季度相比，您不太擔心庫存情況。

But today, you're talking about -- you just talk about that there's a lot of excess of inventory out there.

但是今天，您正在談論-您只是談論那裡有很多過剩的庫存。

So I was just wondering what has happened in the past 3 months?

所以我只是想知道過去3個月發生了什麼？

Is it more due to demand slowdown a lot or it's still more due to there are some hidden inventory now that emerged?

更多是由於需求放緩，還是更多是由於現在出現了一些隱藏的庫存？

I will say it's more due to the sudden drop in the demand rather than there's some hidden inventory that we cannot see.

我會說這更多是由於需求的突然下降，而不是我們看不到一些隱藏的庫存。

Okay.

好的。

Can you elaborate more on the -- which application, which end application has seen the most significant declined in demand?

您能否詳細說明——哪個應用程序、哪個終端應用程序的需求下降幅度最大？

High-end smartphone is one thing, and then others seeing the drop, actually you can imagine that cryptocurrencies mining, they dropped quite a lot.

高端智能手機是一回事，然後其他人看到下降，實際上你可以想像加密貨幣挖礦，他們下降了很多。

And then related to that might be some of the high-performance computing that you can see from other applications that related to the cryptocurrency mining.

然後與此相關的可能是您可以從與加密貨幣挖掘相關的其他應用程序中看到的一些高性能計算。

And in terms of the inventory digestion, I think Lora talked about that.

在庫存消化方面，我認為 Lora 談到了這一點。

The inventory will go back to a more seasonal average level by mid of this year.

到今年年中，庫存將回到更具季節性的平均水平。

So usually, in the down cycle, we usually see the supply chain will tend to overcut inventory to below normal.

所以通常情況下，在下行週期中，我們通常會看到供應鏈傾向於過度削減庫存至低於正常水平。

So in mid this year that means that we are now ready or is that below normal level can before or after that?

所以在今年年中，這意味著我們現在已經準備好，還是在那之前或之後低於正常水平？

We expect it to be a reasonable level that it can extend the business.

我們希望它是一個可以擴展業務的合理水平。

And we expect that this kind of a demand will recover gradually from first quarter, second quarter and then moving to the second half of this year.

並且我們預計這種需求會從一季度、二季度開始逐步恢復，再到今年下半年。

So that's why we expect at mid--- in the middle of this year all the inventory will go back to the reasonable or seasonal level.

這就是為什麼我們預計在今年年中所有庫存將回到合理或季節性水平。

Whether it will be much lower or something like that, we did not expect that yet.

無論它會低得多還是類似的東西，我們都沒有預料到。

Okay.

好的。

Just one last question from me is if you compare this down cycle to the past, I know that TSMC has not offered utilization rate details for many years already.

我的最後一個問題是，如果你將這個下降週期與過去進行比較，我知道台積電已經很多年沒有提供利用率細節了。

But just to give us a rough idea.

但只是給我們一個粗略的想法。

On the current utilization rate you are seeing now in first half of this year compared to the UTR we've seen in 2015, 2012.

與我們在 2015 年和 2012 年看到的 UTR 相比，您現在看到的今年上半年的當前利用率。

Or say post a financial crisis, is it likely to be the lowest point that we have seen since then?

或者說在金融危機之後，它可能是自那時以來我們所看到的最低點嗎？

This -- as Lora just presented, the utilization impact this quarter is really mostly come from 7-nanometer.

這 - 正如 Lora 剛剛介紹的那樣，本季度的利用率影響實際上主要來自 7 納米。

Although other nodes utilization is lower, but if you compare with the last downturn, if you take 2009 for example it's not that low.

雖然其他節點利用率較低，但如果與上次低迷相比，如果以 2009 年為例，它並沒有那麼低。

So 7-nanometer really is the major underutilized.

所以 7 納米確實是未充分利用的主要技術。

We think it's temporary.

我們認為這是暫時的。

So can we assume -- is it fair for us to assume that the UTR is not as slow as in the 2009 yet but there is already lower than what we have seen in 2011, '12 that cycle in 2015 cycle?

所以我們可以假設 - 我們是否可以假設 UTR 沒有 2009 年那麼慢，但已經低於我們在 2011 年看到的 2015 年周期的 12 週期？

You are right, you are right.

你是對的，你是對的。

Next question will be coming from UBS Bill Lu.

下一個問題將來自 UBS Bill Lu。

First question is we've seen a pretty sharp drop-off in demand.

第一個問題是我們已經看到需求急劇下降。

And Dr. Wei I think made a comment that in the future, we will work with customers to plan for capacity differently.

而魏博士我認為在未來，我們將與客戶合作，以不同的方式規劃產能。

Wondering if you could talk a little bit more about that as far as what can be done.

想知道您是否可以就可以做的事情多談一點。

Is it better planning?

是不是更好的規劃？

Is it diversification?

是多元化嗎？

Is it the different payment terms?

是付款方式不同嗎？

Can we just talk a little bit about what are some of the things?

我們可以談談一些事情嗎？

Well, in fact, this is kind of the way we deal with our customer.

嗯，事實上，這就是我們與客戶打交道的一種方式。

So there will be a better planning process.

所以會有一個更好的規劃過程。

TSMC as well as TSMC's customer, I believe that we are learning a lot during this cycle and then we will be more prudent or have found ways at TSMC and customer can work together for the better planning of the capacity in the future without -- to summarizing in one wording, we will be more conservative.

台積電以及台積電的客戶，我相信我們在這個週期中學到了很多東西，然後我們會更加謹慎，或者已經找到了台積電和客戶可以共同努力更好地規劃未來產能的方法，而無需--一言以蔽之，我們會比較保守。

But again, we will not lose our support to our customer.

但同樣，我們不會失去對客戶的支持。

Wider product portfolio is another factor you mentioned.

更廣泛的產品組合是您提到的另一個因素。

Second question is for Lora.

第二個問題是給勞拉的。

Can you talk about the depreciation for this year?

你能談談今年的折舊嗎？

And I'm asking that because I feel like TSMC over the last year, 1.5 years has brought quite a few EUV tools.

我這麼問是因為我覺得台積電在過去的一年裡，1.5 年帶來了相當多的 EUV 工具。

And I believe you don't depreciate until these tools are in production, right?

而且我相信在這些工具投入生產之前你不會貶值，對吧？

And so if you look at the CapEx trend versus the depreciation trend, is there a different linearity because all of a sudden the tools you bought, I don't know, 10, 15 tools need to be depreciated.

因此，如果您查看資本支出趨勢與折舊趨勢，是否存在不同的線性關係，因為突然之間您購買的工具，我不知道，需要折舊 10、15 個工具。

You're right.

你是對的。

We started depreciating the tool when it gets into the productions.

當它進入生產時，我們開始貶值該工具。

The depreciation pattern versus the CapEx changes is not linear, also because whether the CapEx is front end loaded, back end loaded also will impact the whole year depreciation.

折舊模式與資本支出的變化不是線性的，還因為資本支出是前端加載，後端加載也會影響全年折舊。

But I can tell you based on the 10 to 11 billion CapEx this year, we expect the depreciation will increase by mid-single-digit, which is versus last year was double-digit.

但我可以告訴你，根據今年 10 到 110 億的資本支出，我們預計折舊將增加中個位數，與去年相比是兩位數。

So you see, it's all about 10 to 11 billion, but depreciation change can be quite different.

所以你看，大約是 10 到 110 億，但折舊變化可能完全不同。

Sorry I need to walk through the math a little bit.

抱歉，我需要稍微了解一下數學。

What is that assuming for, I guess, the 7+?

我猜 7+ 的假設是什麼？

Because I just want to figure out the next couple of years, as EUV ramps up, are we going to see a pickup or how does that work?

因為我只是想弄清楚未來幾年，隨著 EUV 的興起，我們會看到皮卡還是它是如何工作的？

I don't recall there is a sudden increase.

我不記得有突然增加。

It's a more modest increase year-over-year.

同比增長較為溫和。

All right.

好的。

I think it's about time that we should go to the line for the questions from analysts waiting in the line.

我認為現在是時候排隊等候分析師的提問了。

So operator, could you please have the first caller on the line?

接線員，請您讓第一個來電者在線嗎？

Yes, the first question is from the line of Brett Simpson from Arete Research.

是的，第一個問題來自 Arete Research 的 Brett Simpson。

I did have a question on inventory levels.

我確實對庫存水平有疑問。

Can you help me frame where the industry inventory levels are at the moment, maybe the inventory days versus a quarter ago?

您能幫我確定目前行業庫存水平在哪裡，也許是庫存天數與季度前相比？

And what would you say is normal inventory levels in inventory days?

你會說庫存天的正常庫存水平是多少？

Can you look exactly how elevated the inventory levels are at the moment?

你能看看目前庫存水平有多高嗎？

Brett, I think you probably talk to too close to the microphone, so I'm not hearing you quite well, but I think you are asking the inventory level.

布雷特，我認為您的講話可能離麥克風太近了，所以我聽不太清楚，但我認為您是在詢問庫存水平。

The excess inventory that we see it now versus we saw 3 months ago.

與 3 個月前相比，我們現在看到的過剩庫存。

And you like to have a little bit color on that difference.

你喜歡對這種差異有一點色彩。

Is that your question?

那是你的問題嗎？

Yes.

是的。

I think and also just to understand what normal inventory levels are in your view.

我想也只是為了了解您認為的正常庫存水平。

Three months ago, we estimate the inventory exiting 2018 is several days above seasonal.

三個月前，我們估計 2018 年的庫存比季節性高出幾天。

Now we look at it more like a 10 days above seasonal.

現在我們把它看成比季節性高 10 天。

And you said Smartphone seasonality was also going to be weak in Q1.

你說智能手機的季節性在第一季度也會變弱。

What are you suggesting the communication division revenue in Q1 versus Q4 revenue?

您對第一季度的通信部門收入與第四季度的收入有何建議？

Well, I think the main reason is because of high-end smartphone seasonality.

嗯，我認為主要原因是高端智能手機的季節性。

So that's a -- and typically, Q1 is a low season for the high-end smartphone.

所以這是一個 - 通常情況下，第一季度是高端智能手機的淡季。

But this kind of high inventory is because of a sudden drop (in demand) from the 4Q last year and extended to the first quarter this year.

但這種高庫存是由於去年四季度（需求）突然下降，並延續到今年一季度。

And that's why the inventory suddenly increase so much.

這就是為什麼庫存突然增加這麼多。

Did that answer your question?

這回答了你的問題嗎？

Can you help maybe quantify -- thank you.

你能幫忙量化一下嗎——謝謝。

Can you perhaps quantify how big a drop in Q1 your Communication revenue will be because of the Smartphone seasonality?

您能否量化第一季度由於智能手機的季節性因素，您的通信收入將下降多少？

Okay.

好的。

Lora, would you answer this?

洛拉，你會回答這個問題嗎？

So you're asking the by segment how do we see the changes in first quarter.

所以你問的是我們如何看待第一季度的變化。

Communication in the first quarter will drop the most followed by the computer.

第一季度通信將下降最多，其次是計算機。

Consumer actually will grow slightly and Industrial/Standard will grow (decline) very significant.

消費者實際上會略有增長，工業/標準將增長（下降）非常顯著。

So I think the decline in 3 sectors are all double-digit decline in the first quarter.

所以我認為3個板塊的跌幅都是一季度兩位數的跌幅。

And one last question on 7-nanometer, what percent of sales in Q1 do you expect to come from 7-nanometer?

最後一個關於 7 納米的問題，您預計第一季度的銷售額佔 7 納米的百分比是多少？

And you're suggesting a very strong 7-nanometer ramp in second half when the industry gets back to normal inventory levels.

當行業恢復到正常庫存水平時，您建議在下半年實現非常強勁的 7 納米增長。

Is there a risk that demand for 7-nanometer exceeds supply?

7納米的需求是否存在供不應求的風險？

And to what extent can you get customers to pull in 7-nanometer and start ramping earlier in Q2 of this year?

你能在多大程度上讓客戶參與 7 納米並在今年第二季度早些時候開始加速？

We're trying to understand your question.

我們正在努力理解您的問題。

So you're asking us about 7-nanometer since we said that there's going to be a strong cutback on 7-nanometer.

所以你問我們關於 7 納米的問題，因為我們說 7 納米將會有很大的縮減。

Are you asking what percentage of 7-nanometer is part of our Q1 revenue and then what will be the level in the second half for 7-nanometer?

您是在問 7 納米在我們第一季度收入中的比例是多少，那麼 7 納米在下半年的水平會是多少？

Let me answer.

讓我回答。

Let me try to clarify the ramping of 7-nanometer this year.

讓我試著澄清一下今年 7 納米的發展趨勢。

We already ramped the 7-nanometer last year and that's our first generation 7-nanometer.

去年我們已經推出了 7 納米，這是我們的第一代 7 納米。

Coming to the first quarter, the 7-nanometer composition is about 21% of our corporate revenue already.

進入第一季度，7 納米成分已經占我們公司收入的 21% 左右。

Now this year, we are preparing to ramp the second generation 7-nanometer.

現在，今年，我們正準備推出第二代 7 納米。

We don't have a specific name, different customer have different flavors.

我們沒有特定的名稱，不同的客戶有不同的口味。

But overall, it's their second generation products to be launched this year.

但總的來說，這是他們今年要推出的第二代產品。

So or the 7-nanometer number for the second generation will be drastically increased during this ramp in the second half of this year.

因此，或在今年下半年的這個斜坡期間，第二代的 7 納米數量將大幅增加。

I'm sorry, just to clarify, can you indicate what 7-nanometer as a percent of sales might be in Q1 and does this mark the trough for 7-nanometer in 2019?

抱歉，澄清一下，您能否指出第一季度 7 納米佔銷售額的百分比，這是否標誌著 2019 年 7 納米的低谷？

Question is what's the percentage of 7-nanometer in our revenue in Q1 and whether or not that percentage is the trough, is the lowest for this year.

問題是 7 納米在我們第一季度的收入中所佔的百分比是多少，這個百分比是否是今年的最低點。

Lora, can you answer that?

洛拉，你能回答嗎？

Okay.

好的。

Mark just mentioned the 7-nanometer accounts for 21% of our first quarter revenue.

馬克剛剛提到 7 納米占我們第一季度收入的 21%。

We see that percentage of total revenue will continue to grow.

我們看到總收入的百分比將繼續增長。

So I will say that percentage-wise first quarter will be the trough.

所以我會說第一季度的百分比將是低谷。

So operator let's go to the next caller on the line.

所以接線員讓我們轉到線路上的下一個呼叫者。

Next question is from the line of Mehdi Hosseini from SIG.

下一個問題來自 SIG 的 Mehdi Hosseini。

I have 1 follow-up regarding your high-performance compute expectation for 2019.

關於您對 2019 年的高性能計算期望，我有 1 個跟進。

I believe cryptocurrency accounted for only a few of percentage of overall revenues in the first half of '18.

我相信加密貨幣僅佔 18 年上半年總收入的一小部分。

So why is there still an overhang on your HPC revenue mix?

那麼，為什麼您的 HPC 收入組合仍然存在懸念？

I believe you said including crypto, it will be -- HPC will be down double digits.

我相信你說過包括加密在內，它將是——HPC 將下降兩位數。

And I'm just trying to better understand how it has trended from '18 to '19?

我只是想更好地了解它從 18 年到 19 年的趨勢如何？

And I have a follow-up.

我有一個後續行動。

So Mehdi, I think you are asking us about HPC this year, if crypto accounted for a few points of our business in 2018 and how much crypto will be accounting for our business in 2019.

所以 Mehdi，我想你是在問我們今年的 HPC，如果加密在 2018 年占我們業務的幾個方面，以及在 2019 年我們的業務將佔多少加密。

Yes.

是的。

Okay.

好的。

This year, we don't forecast -- we become conservative in forecasting this volatile business.

今年，我們不做預測——我們在預測這個不穩定的業務時變得保守。

So the cryptocurrency mining this year is much, much less than last year.

所以今年的加密貨幣挖礦比去年少得多。

And to what percentage, I don't think it's -- I can release it right now.

至於百分比，我不認為是——我現在可以發布它。

It is a conservative -- this is a conservative estimation of cryptocurrency.

這是保守的——這是對加密貨幣的保守估計。

You have a new HPC customer program.

您有一個新的 HPC 客戶計劃。

How come those ramps are not enabling you to ramp HPC in 2019 rather than just slightly up?

為什麼這些斜坡不能讓您在 2019 年提高 HPC 而不是略微提高？

So Mehdi's comments is that if we have this expanding customer portfolio in HPC, why is it that HPC, excluding crypto mining, can only grow slightly this year?

所以 Mehdi 的評論是，如果我們在 HPC 中擁有不斷擴大的客戶組合，為什麼不包括加密採礦在內的 HPC 今年只能小幅增長？

All right, good question.

好的，好問題。

It's because of our customer we expand in our customer portfolio and product portfolio.

正是因為我們的客戶，我們擴展了我們的客戶組合和產品組合。

But their ramp will start from probably in the second half this year with the small-volume and then going to the mass production next year.

但他們的爬坡可能會在今年下半年開始小批量生產，然後在明年進入量產階段。

That's why this year, we saw just slightly increase on the HPC business excluding the cryptocurrency.

這就是為什麼今年，我們看到不包括加密貨幣的 HPC 業務略有增長。

And my second follow-up has to do with the 5-nanometer ramp.

我的第二次跟進與 5 納米坡道有關。

And I'm trying to better understand your visibility and tapeout engagement.

我正在努力更好地了解您的知名度和流片參與度。

Should we expect a 5-nanometer ramp in 2020 to look more like a 7 or is that going to be a steeper?

我們是否應該期望 2020 年的 5 納米斜坡看起來更像 7 納米，還是會變得更陡峭？

Any color would be appreciated.

任何顏色都將不勝感激。

Well, let me comment on that.

好吧，讓我對此發表評論。

5-nanometer are ramping in 2020.

5 納米將在 2020 年加速發展。

I would expect that product portfolio is expanding more as compared with the 7-nanometer in 2018.

我預計與 2018 年的 7 納米相比，產品組合的擴展更多。

How much of a steeper of that one, it will be similar or probably we're a little bit conservative.

那個陡峭多少，它將是相似的，或者我們可能有點保守。

But today, we saw the better product portfolio, better customer portfolio.

但是今天，我們看到了更好的產品組合，更好的客戶組合。

But steeper ramp probably will be similar.

但更陡峭的斜坡可能會相似。

Sure.

當然。

Should we assume that 5 would become bigger than 7 in 2021?

我們是否應該假設 5 會在 2021 年大於 7？

Is that when the true benefits of 5 and the customer diversification that will materialize?

那是當 5 的真正好處和客戶多樣化將實現的時候嗎？

From today's situation and customers we engage with, yes, 2021 5-nanometer will be bigger than the 7-nanometer's same period of time.

從今天的情況和我們接觸的客戶來看，是的，2021 年 5 納米將比 7 納米的同期更大。

All right.

好的。

Let's come back to the floor.

讓我們回到地板上。

Next question will be coming from Morgan Stanley's Charlie Chan.

下一個問題將來自摩根士丹利的查理陳。

So my first question is about smartphone semi-demand for this year because the management attribute the weakness in 1Q to a seasonality.

所以我的第一個問題是關於今年智能手機的半需求，因為管理層將第一季度的疲軟歸因於季節性。

But do you see any structural issues?

但是你看到任何結構性問題嗎？

For example, the lengthier replacement cycle (inaudible) issue of the smartphone semi-demand?

例如，智能手機半需求的更長更換週期（聽不清）問題？

And also I can because high-end smartphone, even it's a higher content it should be contributing more for your revenue.

而且我也可以，因為高端智能手機，即使是更高的內容，它也應該為您的收入做出更多貢獻。

But you're assuming this segment will decline and units will decline, right?

但是你假設這個部分會下降，單位會下降，對吧？

So why can you get a number that a full year mobile revenue can still grow slightly?

那麼為什麼能得到一個全年移動收入還能小幅增長的數字呢？

Good question.

好問題。

Actually, high-end smartphone this year at least for the first half still have some kind of inventory issue.

實際上，今年至少上半年的高端智能手機仍然存在某種庫存問題。

But in the second half, we expect that new model coming out.

但在下半年，我們預計新模式會問世。

It's ramping up starting from the second quarter and all the way to the end of this year with a new model coming out.

從第二季度開始一直到今年年底，隨著新車型的問世，它正在加速發展。

However, the total units as we expected or we forecasted that what we drop slightly.

但是，總單位如我們預期或我們預測的那樣略有下降。

The content will increase more than the unit drop in the percentage-wise.

含量將按百分比增加超過單位下降。

So TSMC still grow slightly on the mobile business.

所以台積電在移動業務上仍有小幅增長。

That's why.

這就是為什麼。

And your question is...

而你的問題是...

So I just want to get a confidence why you think second half that recovery could happen, right?

所以我只是想確定為什麼你認為下半年會出現復甦，對吧？

Because it's possible that a new product may disappoint again.

因為新產品可能會再次令人失望。

And also, yes, if I can get more color, do you think it's kind of a specific brand issue or is that across different brands for the high-end smartphone demand issue?

而且，是的，如果我能獲得更多顏色，你認為這是一個特定的品牌問題，還是針對高端智能手機需求的不同品牌之間的問題？

All right.

好的。

Second half, that's a good question also.

下半場，這也是個好問題。

Second half, why we still expect a recovery, because we have a better customer portfolio.

下半年，為什麼我們仍然期待復甦，因為我們擁有更好的客戶組合。

That's all I can say.

這就是我能說的。

Okay, fair enough.

好吧，夠公平的。

So market share again there.

所以市場份額又在那裡。

And also I want to follow-up the previous question regarding HPC, right?

我還想跟進上一個關於 HPC 的問題，對吧？

So because compared to your previous target to grow 20% year-on-year every year for HPC, I feel like except for crypto there's also some demand issue, right?

因此，因為與您之前的 HPC 每年同比增長 20% 的目標相比，我覺得除了加密之外還有一些需求問題，對吧？

For example, I'm not sure what you will see the demand in AI cloud and those telecommunication, right?

例如，我不確定你會看到 AI 雲和那些電信的需求，對嗎？

Because that will be some demand issue to get only kind of slightly growth for HPC versus your targets of 20%.

因為這將是一些需求問題，與您的 20% 目標相比，HPC 僅略有增長。

Can you comment on the demand?

你能評論一下需求嗎？

Okay, let me comment on that.

好的，讓我對此發表評論。

We used to be very optimistic.

我們曾經非常樂觀。

We're still very optimistic because of the AI and 5G.

由於人工智能和 5G，我們仍然非常樂觀。

But AI and 5G -- AI is picking up.

但人工智能和 5G——人工智能正在興起。

5G will start from this second half.

5G將從下半年開始。

Start to install some of the base station, the infrastructure will start to build out.

開始安裝一些基站，基礎設施將開始建設。

So we did not expect the 5G smartphone will be a big number this year.

所以我們沒想到今年 5G 智能手機會是一個大數字。

It will be a big number next year.

明年將是一個很大的數字。

And all the smartphone we expect that the AI will be included inside with some kind of a content that we did not get the full picture yet but we know is increasing.

我們預計所有智能手機都將包含人工智能，其中包含某種我們尚未了解全貌但我們知道正在增加的內容。

And you are talking about HPC.

你說的是高性能計算。

We used to say the 20% CAGR.

我們過去常說 20% 的複合年增長率。

Did we say that?

我們說過嗎？

Last year and the year before.

去年和前年。

Oh no.

不好了。

The last year compared with a year before because there is a 1 uncertain -- not 1 uncertain, 1 surprise that's called cryptocurrency mining.

去年與前一年相比，因為存在 1 個不確定——不是 1 個不確定，1 個驚喜，這被稱為加密貨幣挖礦。

It suddenly increased dramatically.

它突然急劇增加。

And TSMC because of the technology offering, so we have to say that we are the -- we get most of the benefit of the cryptocurrency's mining business.

而台積電由於提供的技術，所以我們不得不說我們是——我們從加密貨幣的採礦業務中獲得了大部分利益。

Now we saw volatility drop.

現在我們看到波動性下降。

However, without the cryptocurrency, we still see strong momentum on the high-performance computing: one, because we have very competitive or actually I want to say the industry leading technology which fits the requirement of HPC business; second, again, I would have to say we have a stronger customer portfolio.

但是，在沒有加密貨幣的情況下，我們仍然看到了高性能計算的強勁勢頭：一是因為我們有非常有競爭力或者實際上我想說的是符合HPC業務需求的行業領先技術；其次，我不得不說我們擁有更強大的客戶組合。

Let's look beyond 2019, right.

讓我們看看 2019 年以後，對吧。

So for 2 or 3 very high growth profile segment, HPC, IoT and auto, which I was very surprised that your company is only flat year-on-year.

因此，對於 2 或 3 個非常高增長的細分市場，HPC、物聯網和汽車，我很驚訝貴公司僅與去年同期持平。

So for coming in maybe 2 or 3 years, what do you think should be the right CAGR for HPC, IoT and auto?

因此，對於未來 2 或 3 年，您認為 HPC、物聯網和汽車的正確複合年增長率應該是多少？

I think the strongest growth is high-performance computing.

我認為最強勁的增長是高性能計算。

The second strong growth in terms of the dollar increase is still smartphone, yes.

是的，就美元增長而言，第二個強勁增長仍然是智能手機。

So that's a dollar increase.

所以這是一個美元的增長。

But auto includes those kind of EV -- I'm not sure how you classify the autonomous driving, right?

但是汽車包括那種類型的電動汽車——我不確定你如何對自動駕駛進行分類，對吧？

But auto I think it used to be kind of a segment the company expects strong growth.

但汽車我認為它曾經是公司預計強勁增長的一個細分市場。

Why this year we don't...

為什麼今年我們不...

Yes.

是的。

Auto if you look at the past 2 years, it's a very strong growth, 27%.

如果你回顧過去兩年，汽車行業的增長非常強勁，達到了 27%。

But as you know, since last year, suddenly the automotive markets almost stopped growing.

但如您所知，從去年開始，汽車市場突然幾乎停止增長。

Many of our customers say the same thing.

我們的許多客戶都說同樣的話。

Very consistently.

非常一致。

And some of them has attributed to the steel and aluminum tariffs.

其中一些歸因於鋼鋁關稅。

And that is I think is the structure of the automotive.

這就是我認為是汽車的結構。

In terms of the long-term, we still see the innovation of automotive will come out of this.

從長遠來看，我們仍然看到汽車的創新將由此而來。

So yes, I guess 1 question from a lot of investors it's about dividend payout expectation right, because comment was steady growth every year.

所以是的，我猜很多投資者的一個問題是關於股息支付預期的，因為評論是每年穩定增長。

But you have had some over the past 2 years EPS growth of around 3% per year and this year, I'm not sure, right.

但是在過去的 2 年中，EPS 每年增長約 3%，而今年，我不確定，對吧。

It will be flat, right?

它會是平的，對吧？

So does the company think this year you want to increase the dividend dollars again?

那麼公司認為今年你想再次增加股息美元嗎？

Despite the short-term market weakness, if we look at free cash flow that we can generate remain very strong.

儘管短期市場疲軟，但如果我們看看我們可以產生的自由現金流仍然非常強勁。

So we plan to further increase dividend in 2019.

因此，我們計劃在 2019 年進一步增加股息。

We will get the board approval in February.

我們將在二月份獲得董事會的批准。

So will make announcement after that.

所以之後會發佈公告。

All right.

好的。

Next question will be coming from JPMorgan's Gokul.

下一個問題將來自摩根大通的 Gokul。

My first question, could you talk a little bit about any recalibration in the China expansion given what we have seen with cryptocurrency and some the China demand as well?

我的第一個問題，鑑於我們在加密貨幣方面看到的情況以及中國的一些需求，您能否談談中國擴張的任何重新調整？

Could you talk about the plans on China expansion?

您能談談中國擴張的計劃嗎？

The last time, you mentioned maybe go up to 20k in phase 1 and then potentially expand beyond that.

上次，您提到可能會在第一階段達到 20k，然後可能會擴大。

Was there any timeline difference on the Nanjing fab?

南京工廠的時間線有什麼不同嗎？

The plan did not change, because this is so short-term different kind of market softening.

該計劃沒有改變，因為這是短期不同類型的市場疲軟。

No, it did not change our strategy.

不，這並沒有改變我們的策略。

The plan continues.

該計劃仍在繼續。

Is there any timing differential in terms of when you get to phase 2 given (inaudible)

給定的第 2 階段是否存在時間差異（聽不清）

It will depend on the business situation, definitely.

這肯定取決於業務情況。

But 20,000 wafer per month is a plan, continue to be executed.

但每月20,000片晶圓是計劃，繼續執行。

Okay.

好的。

Next question I had was on N5.

我的下一個問題是關於N5。

Just building on some of the questions as well.

也只是建立在一些問題上。

It is for many customers it's going to be the first node with significant EUV insertion.

對於許多客戶來說，它將成為第一個具有大量 EUV 插入的節點。

So could you help us understand what is the feedback you're getting from customers.

那麼您能否幫助我們了解您從客戶那裡得到的反饋是什麼？

Are customers planning to stay on at N7 longer even N7 has been successfully proven node and as you mentioned a lot more customers are coming through there or do we expect to see the same number of tapeouts like 50 tapeouts that you had by the end of 2017?

客戶是否計劃在 N7 上停留更長時間，即使 N7 已成功驗證節點，正如您提到的那樣，更多的客戶正在通過那裡，或者我們是否希望看到與 2017 年底相同數量的流片，例如 50 個流片?

Are we going to be at similar kind of levels as we get into end of this year?

進入今年年底，我們是否會處於類似的水平？

Can you give us some idea about how that progress from our breadth of customer base is progressing in N5?

您能否告訴我們一些關於我們廣泛的客戶群在 N5 中取得的進展如何？

Okay.

好的。

On the N5 progress, I just reported that our progress is on track and we work with the customers.

關於 N5 的進展，我剛剛報告說我們的進展正在正常進行，我們正在與客戶合作。

And you say that whether our customers have worry or concern on EUV's readiness or stability and those kind of things, no, they are happy with us.

你說我們的客戶是否擔心或擔心 EUV 的準備或穩定性以及諸如此類的事情，不，他們對我們感到滿意。

We worked with supplier, we worked with the customer on both side and our progress is so far, so good.

我們與供應商合作，我們與雙方的客戶合作，到目前為止，我們的進展非常好。

Now whether that they want to move into N5 or stay in the 7, all I say is all the customer who are working with us on N7 are engaging with us at N5.

現在，無論他們是想搬進 N5 還是留在 7 號，我只想說在 N7 上與我們合作的所有客戶都在 N5 與我們接觸。

The product, when they want to introduce into the market that is our customer's judgment.

產品，當他們想推向市場時，是我們客戶的判斷。

Because N5 did offer very good performance per se as compared with N7.

因為與 N7 相比，N5 本身確實提供了非常好的性能。

So some of the high-speed computing, some of the high-end smartphone, they still need to go into N5.

所以一些高速運算，一些高端智能手機，還是需要進入N5的。

So you would expect those customer will adopt the N5 immediately that when it is available, okay.

所以你會期望那些客戶會在 N5 可用時立即採用它，好吧。

So number of the tapeouts, I cannot tell you right now.

所以流片的數量，我現在不能告訴你。

But I already told you that all the customers are engaging with us.

但我已經告訴過你，所有的客戶都在和我們打交道。

Next question will be coming from Crédit Suisse with Randy Abrams.

下一個問題將來自 Crédit Suisse 和 Randy Abrams。

I wanted to follow-up on your guidance for 2019.

我想跟進您對 2019 年的指導。

Last year, you gave a guidance at the beginning of the year for first half year-over-year growth and also the second half year-over-year.

去年，您在年初給出了上半年同比增長和下半年同比增長的指導。

So if you could give a view or maybe split how you see in first half versus second half?

所以，如果你能給出一個觀點，或者可以分開你對上半場和下半場的看法？

Lora, can you give the number?

勞拉，你能給個電話號碼嗎？

Second half definitely is better than first half, okay?

下半場肯定比上半場好，好嗎？

That's good, much better.

這很好，好多了。

First quarter of '19 is quite weak, and we think it's going to take another quarter to recover.

19 年第一季度相當疲軟，我們認為還需要一個季度才能恢復。

So from what I have seen now for this year, if you compare year-over-year, our first half may not be higher, maybe worse than last year.

所以從我現在看到的今年來看，如果你與去年同期相比，我們的上半年可能不會比去年高，甚至可能比去年差。

But second half definitely will be better.

但下半場肯定會更好。

A follow-up on the application and inventory issue, could you talk how broad?

關於應用程序和庫存問題的後續行動，你能談談多廣泛嗎？

Because you did flag smartphone as inventory, but could you flag how broad you think that inventory issue is?

因為您確實將智能手機標記為庫存，但您能否標記您認為庫存問題的範圍有多大？

Will cross applications in the guidance per product had industrial up significantly, consumer up slightly.

將交叉應用在每件產品的指導下有工業大幅上漲，消費略有上漲。

If you could talk a bit about that factoring in the inventory comments, what's driving those increases.

如果您可以談談庫存評論中的因素，那麼是什麼推動了這些增長。

You mean supply chains inventory?

你的意思是供應鏈庫存？

Yes, because you mentioned it's a broad inventory or you have an inventory issue.

是的，因為您提到這是一個廣泛的庫存，或者您有庫存問題。

How do see it across the other applications and what's driving the segments.

如何在其他應用程序中看到它以及驅動這些細分市場的因素。

Exiting 2018, I think the inventory increase is broad range, because of the macroeconomic uncertainty in this trade tension.

離開 2018 年，我認為庫存增加幅度很大，因為這種貿易緊張局勢中的宏觀經濟不確定性。

Pretty much put people really on hold very careful.

幾乎讓人們非常小心。

So there's used to be across the board.

所以曾經有過全面的。

Okay.

好的。

Then I guess, the rationale then for industrial up significantly and consumer up slightly.

然後我猜，工業顯著上漲和消費小幅上漲的理由。

Well, I think that the industrial...

嗯，我認為工業...

Randy, your question is industrial segment is down in first quarter.

蘭迪，你的問題是工業部門在第一季度下降。

No, I think you said industrial was up significantly and consumer up slightly (inaudible)

不，我認為您說工業顯著上升，而消費者略有上升（聽不清）

No, no, I said industrial down significantly.

不，不，我說工業下降明顯。

Only consumer up slightly.

僅消費小幅上漲。

The other sector all down, okay?

其他部門全都下來了，好嗎？

And if I could squeeze 1 more in the backend, it's still another significant CapEx.

如果我可以在後端再擠 1 個，這仍然是另一個重要的資本支出。

Could you talk maybe a snapshot what you expect for the backend business this year and what you're seeing for InFO and CoWoS expansion this year?

您能否簡要介紹一下您今年對後端業務的期望以及您對今年 InFO 和 CoWoS 擴展的看法？

The backend business is this year it will grow double-digit.

後端業務今年將實現兩位數增長。

Still a very good business because of we offer the solution to the customers so that they can get the higher performance and better cost structure that they can find in other piece?

由於我們為客戶提供解決方案，以便他們可以獲得其他產品中可以找到的更高性能和更好的成本結構，因此仍然是一個非常好的業務？

The back-end last year is about 2.5 billion.

去年的後端大約是25億。

And going forward, currently, we see the double-digit growth at least year-over-year.

展望未來，目前，我們看到至少同比增長兩位數。

To clarify, backend business still is in initial stage because as you remember initially, our backend was adopted by the smartphone.

需要澄清的是，後端業務仍處於起步階段，因為正如您最初記得的那樣，我們的後端被智能手機採用。

But now more and more, we see the high-performance computing customer in the 5-nanometer.

但現在越來越多，我們看到了5納米的高性能計算客戶。

Almost all of them adopt -- wants to adopt what we call advanced packaging.

幾乎他們都採用——想要採用我們所說的先進封裝。

So we see the advanced packaging business is coming to support our high-performance computing products across the leading edge customers.

因此，我們看到先進封裝業務正在支持我們面向前沿客戶的高性能計算產品。

Just to make the record, from now on, we call -- we don't call backend.

只是為了記錄，從現在開始，我們調用 - 我們不調用後端。

We call that advanced packaging because we realize that packaging is very different than the OSAT business we used to know.

我們稱其為高級封裝，因為我們意識到封裝與我們過去所知道的 OSAT 業務非常不同。

Follow-up question from CL Securities, Sebastian Hou.

CL Securities，Sebastian Hou 的後續問題。

First follow-up is can you provide us some update on the tapeout numbers that you have received on 5-nanometers now or your expectation by the end of this year?

第一個跟進是您能否向我們提供一些關於您現在收到的 5 納米流片數量的最新信息，或者您對今年年底的預期？

Well, I just say that I cannot give you the numbers today.

好吧，我只是說我今天不能給你數字。

But I repeat it again, all the 7-nanometer customers are working with us right now on their designed.

但我再說一遍，所有 7 納米客戶現在都在與我們合作進行他們的設計。

Okay.

好的。

And the 7-nanometer tapeout number still on track to exceed 100 by the end of this year?

到今年年底，7 納米流片數量仍有望超過 100 個？

It's still.

它仍然。

Or it could be earlier?

或者它可能更早？

Well, it will depend on how quickly that our customer can adopt our N7, N7+.

嗯，這將取決於我們的客戶能多快採用我們的 N7、N7+。

But still, the numbers still meet our expectations on the HPC probably even more higher, yes.

但是，這些數字仍然符合我們對 HPC 的預期，可能更高，是的。

And given the current macro uncertainty, have you noticed any of your customers which are during the tapeout on 7 right now, become more hesitant or cautious in terms of the production schedule?

鑑於當前宏觀的不確定性，您是否注意到您的任何客戶現在正在 7 流片期間，在生產計劃方面變得更加猶豫或謹慎？

No, they are being very aggressive because of 7-nanometer has very good performance.

不，他們非常激進，因為 7 納米具有非常好的性能。

So they can sell them to gain the market -- to their product going to the market.

所以他們可以賣掉它們來贏得市場——把他們的產品推向市場。

So it's not slowing down.

所以它並沒有放緩。

It's actually accelerating a little bit.

它實際上正在加速一點。

Okay.

好的。

So I think last year and this year, I think probably only not a big portion of these 7-nanometer tapeout with customers are reaching production.

所以我認為去年和今年，我認為這些客戶的 7 納米流片中可能只有不是很大一部分進入生產階段。

Is that a fair assumption?

這是一個公平的假設嗎？

Just...

只是...

Yes.

是的。

Just one of the big customers account for big wafer volume but the tapeout number is small.

只有大客戶之一的晶圓量很大，但流片數量很少。

Which means do you expect more of this smaller volume type customers but to get account of the big numbers of the tapeout will reach production in 2020.

這意味著您是否期望更多這種小批量類型的客戶，但要考慮到大量的流片將在 2020 年投入生產。

Well, I just mentioned yes, some of the second wave or third wave of product design get into the 7, 7+ will start to ramp probably second half or the fourth quarter of this year.

好吧，我剛才提到是的，一些第二波或第三波產品設計進入 7、7+ 可能會在今年下半年或第四季度開始上升。

Mass production will be expected in 2020.

預計2020年量產。

Okay.

好的。

So it sounds like you don't notice or feel any bubbling in terms of the tapeout booming.

因此，就流片的蓬勃發展而言，您似乎沒有註意到或感覺到任何冒泡。

No we did not see that.

不，我們沒有看到。

Okay, it's great.

好的，這很棒。

My next question is -- sorry, I won't have another question.

我的下一個問題是——抱歉，我不會再有其他問題了。

Okay.

好的。

The right, follow-up questions from Citi's Roland Shu.

花旗的 Roland Shu 的右圖是後續問題。

Last year, the raw wafer negatively impacted gross margin.

去年，原始晶圓對毛利率產生了負面影響。

How about this year?

今年怎麼樣？

Are we going to still see the same change or we happen to see will be reversed maybe a benefit for this raw wafer price on margin?

我們是否還會看到同樣的變化，或者我們碰巧看到會逆轉，這可能對這個原始晶圓價格的利潤有利？

We have signed a long-term contract with our suppliers in 2017 and '18.

我們在 2017 年和 18 年與供應商簽訂了長期合同。

So lock in the long-term supply and also lock in the price.

因此，鎖定長期供應並鎖定價格。

So we do not see any further price deterioration for us, yes.

所以我們沒有看到任何進一步的價格惡化，是的。

Okay, yes but given now that demand is declining and are we going to renegotiate these longer contracts with the wafer suppliers?

好的，是的，但是鑑於需求正在下降，我們是否要與晶圓供應商重新談判這些更長的合同？

Yes.

是的。

So this is for 2019 and 2020 or going forward?

那麼這是針對 2019 年和 2020 年還是未來？

Going forward.

往前走。

Going forward, we hope we achieve some cost saving.

展望未來，我們希望能夠節省一些成本。

Second question is by when you will see your CPU revenue to reach 1% of your total revenue and also by when you will see the CPU foundry also coming from multiple customers?

第二個問題是您何時會看到您的 CPU 收入達到總收入的 1%，以及何時您會看到 CPU 代工廠也來自多個客戶？

That's some very specific 1% but just say that we started working with the CPU customers and starting from 7, 7+ and all the way to 5, okay?

這是一個非常具體的 1%，但只是說我們開始與 CPU 客戶合作，從 7、7+ 一直到 5，好嗎？

And when time's up I'll report it here, say what is percentage that we got from the CPU, okay.

當時間到了，我會在這里報告，說我們從 CPU 得到的百分比是多少，好的。

I think you can calculate from our customers' financial.

我想你可以從我們客戶的財務上算出來。

Okay.

好的。

Just to clarify, C.C, you said that you start to work with a CPU customer or customers.

澄清一下，C.C，你說你開始與一個或多個 CPU 客戶合作。

Customers.

顧客。

All right.

好的。

Next question will be coming from UBS is Bill Lu.

瑞銀的下一個問題是比爾·盧。

A couple of questions on the trade tension in tariffs.

關於關稅貿易緊張局勢的幾個問題。

With tariffs becoming, I guess more prevalent, does that change your outlook on where to place the fabs?

隨著關稅變得越來越普遍，我猜這是否會改變您對晶圓廠佈局的看法？

And secondly, you've got more competition at the trailing edge if you look at the Chinese fabs.

其次，如果你看看中國的晶圓廠，你就會在後緣面臨更多的競爭。

Are you seeing an opportunity to for it to take share with the trade tension?

您是否看到了與貿易緊張局勢分擔的機會？

Okay.

好的。

You talked about fab location, right?

你談到了工廠的位置，對吧？

It is -- as you know, we have -- when we build fab, nowadays we only build the leading edge fabs.

它是——如你所知，我們有——當我們建造晶圓廠時，現在我們只建造領先的晶圓廠。

That is we're doing 5-nanometer fabs, preparation and we're building 3-nanometer.

那就是我們正在做 5 納米晶圓廠，準備工作，我們正在建造 3 納米。

And the decision was made to build in Tainan, okay?

然後決定建在台南，好嗎？

And of course, with across-the-board support from the local and administration here.

當然，在當地和行政部門的全面支持下。

Upon the trade tension, I think it appears that we will, at this point, it seems that there are much -- it is good to build a fab in Taiwan.

在貿易緊張的情況下，我認為我們似乎會，在這一點上，似乎有很多——在台灣建一個晶圓廠很好。

But actually, we have almost none request from our customers to change the plan we have.

但實際上，我們幾乎沒有客戶要求我們更改我們的計劃。

We -- but however we do constantly assessing and deliberation about what's the pros and cons of that plan and whether there are other options.

我們 - 但是我們會不斷評估和考慮該計劃的利弊以及是否有其他選擇。

But so far, we haven't changed our plan.

但到目前為止，我們還沒有改變我們的計劃。

The prime reason is this: When we ramp the leading edge fabs, as you know those are really for the high-performance computing or smartphone launch, the ramp is very tight.

主要原因是：當我們提升領先的晶圓廠時，正如您所知，這些晶圓廠確實是為高性能計算或智能手機推出而設計的，但坡道非常緊張。

Time-to-market is critical.

上市時間至關重要。

And to have a leading edge fab ramp not only this fab has to be closely coupled with an R&D fab, which is in Hsinchu, the 2 teams also work as 1 team, also this fab has to collaborate with other fabs in TSMC.

為了擁有領先的晶圓廠斜坡，不僅這個晶圓廠必須與新竹的研髮晶圓廠緊密結合，這兩個團隊也作為一個團隊工作，而且這個晶圓廠還必須與台積電的其他晶圓廠合作。

As our founder mentioned, there are thousands of engineers, transport from fab to fab to cope with this sudden ramp of those resources needed.

正如我們的創始人所提到的，有成千上萬的工程師從一個工廠運送到另一個工廠，以應對所需資源的突然增加。

So those are the background of those leading edge fabs.

因此，這些就是那些前沿晶圓廠的背景。

When we open book with our customers, this is the best sure way to ensure their product announcement and product launch and the request conversation will take them back.

當我們與客戶一起打開書本時，這是確保他們的產品發布和產品發布以及請求對話將把他們帶回來的最好方法。

But we're constantly watching this on bigger geopolitical change.

但我們一直在關注更大的地緣政治變化。

Of course, at this present time, we do not have plan to change that.

當然，目前我們沒有計劃改變這一點。

The second part of the question is are you seeing an opportunity to take share, for example?

問題的第二部分是，例如，您是否看到了分享的機會？

A few of our customers don't want to use Chinese fabs?

我們的一些客戶不想使用中國晶圓廠？

The question is say that again?

問題是再說一遍？

Is there an opportunity at the trailing edge 28-nanometer, 8 inch to take market share?

28 納米、8 英寸的後緣是否有機會搶占市場份額？

From Chinese Fab?

來自中國工廠？

(inaudible)

（聽不清）

Well, most of the U.S. customer -- currently, the Chinese Fab is still not used by the local customers, when you put it this way.

好吧，大多數美國客戶——當你這樣說的時候，中國的 Fab 仍然沒有被當地客戶使用。

Intention of the other U.S. customer, we didn't encounter those comments.

其他美國客戶的意圖，我們沒有遇到這些評論。

All right.

好的。

Follow-up questions coming from Morgan Stanley's Charlie -- Charlie Chan.

來自摩根士丹利的查理——陳查理的後續問題。

Yes.

是的。

So I want to follow up a little bit about the trade tension issue because another topic is Huawei's 5G and information security issue.

所以我想稍微跟進一下貿易緊張問題，因為另一個話題是華為的5G和信息安全問題。

So how does the company kind of evaluate this kind of business risk?

那麼公司如何評估這種業務風險呢？

I mean exposure to Huawei's supply chain and have you got any concern from governments or U.S. governments on this topic.

我的意思是接觸華為的供應鏈，你有沒有得到政府或美國政府對這個話題的關注。

No, and we are everybody's foundry.

不，我們是每個人的代工廠。

And we did not see any kind of instruction or information from the government so business as usual.

我們沒有看到任何來自政府的指示或信息，所以一切照舊。

And also, another question is regarding your specialty semiconductor strategy.

此外，另一個問題是關於您的專業半導體戰略。

As you mentioned, you want to build up a new 8" fab in Tainan.

正如你所提到的，你想在台南建立一個新的 8 英寸晶圓廠。

I would guess is for lots of niche demand.

我猜是為了滿足大量的利基需求。

But how do you deal with this kind of outsourcing or partnership with your subsidiary Vanguard going forward in the 8-inch business?

但是您如何處理這種外包或與您的子公司 Vanguard 在 8 英寸業務中的合作關係？

Well, if you look at the market, 8 inch as a business that is actually some time the capacity is in shortage.

好吧，如果你看市場，8英寸作為一個業務實際上是有一段時間產能短缺的。

But regardless of Vanguard or not, TSMC did not increase the capacity.

但不管先鋒與否，台積電都沒有增加產能。

We increased the specialties capability and also our service to the customer.

我們增加了專業能力，也增加了我們對客戶的服務。

So we built the new building to give more room to put the specialty tool inside to support our customer.

因此，我們建造了新大樓以提供更多空間來放置專業工具以支持我們的客戶。

Okay, okay.

好吧好吧。

And that's the -- I guess, this year could be tough, right, could be the first downturn that 2 gentlemen become the new management, right?

這就是——我想，今年可能會很艱難，對，可能是兩位先生成為新管理層的第一次低迷，對吧？

So is there any initiative that you want to take the company, get through this potential downturn?

那麼，您是否想採取任何舉措讓公司度過這個潛在的低迷期？

Any new initiatives in the company?

公司有什麼新舉措嗎？

Why do you say this is a new management?

為什麼說這是新管理層？

We have been here for more than 20 years at least.

我們已經在這里至少 20 多年了。

The new measure -- I mean, that's -- we follow a very good guidance from the previous chairman.

新措施——我的意思是——我們遵循了前任主席的非常好的指導。

And so far, so good.

到目前為止，一切都很好。

The strategy continues, the management style continues.

戰略繼續，管理方式繼續。

So new management, hard to say.

這麼新的管理層，很難說。

Sorry for the phrasing, sorry.

措辭抱歉，對不起。

Let me comment.

讓我評論一下。

This is -- we, over the years, I mean, right now, probably is the -- in terms of technology portfolio TSMC has built, both leading edge and specialty, I think this is the strongest position at present time.

這是 - 我們，多年來，我的意思是，現在，可能是 - 就台積電建立的技術組合而言，無論是領先優勢還是專業，我認為這是目前最強大的位置。

Do you agree?

你同意嗎？

And also about the customer engagement or customer portfolio, this time, it's about the widest customer portfolio we ever have.

還有關於客戶參與或客戶組合，這一次，它是關於我們擁有的最廣泛的客戶組合。

And C.C. is talking about getting into high-performance computing even the CPUs, including data center CPU, accelerators and the client CPUs.

和 C.C.正在談論進入高性能計算甚至 CPU，包括數據中心 CPU、加速器和客戶端 CPU。

It's probably the widest addressable market we ever have.

這可能是我們擁有的最廣泛的潛在市場。

So we're going to continue these 3 thrusts.

所以我們將繼續這三個推力。

We're going to invest further on the R&D and we're going to continue to engage with our customers' design, closely building the team.

我們將在研發上進一步投資，我們將繼續參與客戶的設計，密切建立團隊。

Actually we sent people to our customers to build the design of 5-nanometer some of the 3-nanometer discussion.

實際上我們派人到我們的客戶建立5納米的一些3納米的設計討論。

And also, we just want the high-performance computing can adopt our technology development features more tightly.

而且，我們只是希望高性能計算能夠更緊密地採用我們的技術開發特性。

So we think this is a -- although we're facing some headwinds on the macroeconomy and just another uncertainty is not our control.

所以我們認為這是一個——儘管我們在宏觀經濟方面面臨一些逆風，而另一個不確定性不是我們所能控制的。

It's the trade dispute tension, we just hope the 2 country can come to a win-win or at least not lose-lose solution.

這是貿易爭端的緊張局勢，我們只希望兩國能夠達成雙贏或至少不是雙輸的解決方案。

I think we're on the road to the -- to climb our next peak, yes.

我認為我們正在通往——攀登下一個高峰，是的。

With TSMC's business under the steady stable hands and the expanding addressable market, we will conclude today's conference.

台積電業務穩中求進，目標市場不斷擴大，今天的發布會到此結束。

So please be advised that the replay of the conference will be accessible within 4 hours from now.

因此請注意，會議的重播將在 4 小時內提供。

The transcript will become available 24 hours from now, both of which will be available through our website at www.tsmc.com.

成績單將在 24 小時後提供，兩者都將通過我們的網站 www.tsmc.com 提供。

Thank you for joining us today.

感謝您今天加入我們。

We hope you will join us again next quarter.

我們希望您能在下個季度再次加入我們。

Goodbye, and have a good day.

再見，祝你有美好的一天。

Thank you.

謝謝你。

Thank you very much.

非常感謝。