TTM Technologies Inc (TTMI) 2021 Q2 法說會逐字稿

Good afternoon, ladies and gentlemen. Welcome to the TTM Technologies' Second Quarter 2021 Financial Results Conference Call. (Operator Instructions) As a reminder, this conference is being recorded today, July 28, 2021. Sameer Desai, TTM's Vice President of Corporate Development and Investor Relations, will now review TTM's disclosure statement. Please go ahead, sir.

女士們、先生們，午安。歡迎參加 TTM Technologies 2021 年第二季財務業績電話會議。 （操作員說明）謹此提醒，本次會議將於今天（2021 年 7 月 28 日）進行錄製。請繼續，先生。

Thank you, Travis. Before we get started, I would like to remind everyone that today's call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to TTM's future business outlook. Actual results could differ materially from these forward-looking statements due to one or more risks and uncertainties, including the factors explained in our most recent annual report on Form 10-K and other filings with the Securities and Exchange Commission. These forward-looking statements are based on the management's expectations and assumptions at the date of this presentation. TTM does not undertake any obligation to publicly update or revise any of these statements, whether as a result of new information, future events, or other circumstances, except as required by law. Please refer to the disclosure regarding the risks that may affect TTM, which may be found in the reports on Form 10-K, 10-Q, 8-K, the registration statement on Form S-4 and the company's other SEC filings.

謝謝你，崔維斯。在開始之前，我想提醒大家，今天的電話會議包含 1995 年《私人證券訴訟改革法案》含義內的前瞻性陳述，包括與 TTM 未來業務前景相關的陳述。由於一種或多種風險和不確定性，實際結果可能與這些前瞻性陳述有重大差異，包括我們最新的 10-K 表格年度報告和向美國證券交易委員會提交的其他文件中解釋的因素。這些前瞻性陳述是基於管理階層在本簡報發布之日的預期和假設。 TTM 不承擔公開更新或修改任何這些聲明的義務，無論是由於新資訊、未來事件或其他情況，除非法律要求。請參閱有關可能影響 TTM 的風險的揭露，這些資訊可以在表格 10-K、10-Q、8-K 的報告、表格 S-4 的註冊聲明以及公司其他 SEC 備案文件中找到。

We will also discuss on this call certain non-GAAP financial measures such as adjusted EBITDA. Such measures should not be considered as a substitute for the measures prepared and presented in accordance with GAAP, and we direct you to the reconciliation of non-GAAP to GAAP measures included in the company's press release, which was filed with the SEC and is available on TTM's website at www.ttm.com. We have also posted on our website a slide deck, which we'll refer to during our call.

我們也會在本次電話會議上討論某些非公認會計準則財務指標，例如調整後的 EBITDA。此類措施不應被視為替代根據 GAAP 準備和提出的措施，我們會指導您對公司新聞稿中包含的非 GAAP 與 GAAP 措施進行協調，該新聞稿已向 SEC 備案並可獲取請訪問TTM 網站www.ttm.com。我們還在網站上發布了幻燈片，我們將在通話期間參考。

I will now turn the call over to Tom Edman, TTM's Chief Executive Officer. Please go ahead, Tom.

我現在將把電話轉給 TTM 執行長 Tom Edman。請繼續，湯姆。

Thank you, Sameer. Good afternoon, and thank you for joining us for our Second Quarter 2021 Conference Call. I'll begin with a review of our business strategy, followed by highlights from the quarter and a discussion of our second quarter results. Todd Schull, our CFO, will follow with an overview of our Q2 2021 financial performance and our Q3 2021 guidance. We will then open the call to your questions.

謝謝你，薩米爾。下午好，感謝您參加我們的 2021 年第二季電話會議。我將首先回顧我們的業務策略，然後是本季的亮點並討論我們第二季的業績。我們的財務長 Todd Schull 隨後將概述我們 2021 年第二季的財務表現和 2021 年第三季的指導。然後我們將開始電話詢問您的問題。

I am pleased to report that in the second quarter of 2021, TTM generated revenues and non-GAAP EPS above the high-end of the guided range. All commercial end markets were better than guidance and year-on-year growth was led by strength in the Automotive and Data Center Computing markets. These results were achieved despite supply chain constraints, inflationary challenges, and foreign exchange headwinds. Last quarter, I discussed with you the increasing prices and lead times of laminates, a key raw material for the manufacture of printed circuit boards.

我很高興地報告，2021 年第二季度，TTM 的收入和非 GAAP 每股收益均高於指導範圍的高端。所有商業終端市場均優於預期，較去年同期成長由汽車和資料中心計算市場的強勁帶動。儘管存在供應鏈限制、通膨挑戰和外匯不利因素，但仍取得了這些成果。上個季度，我與您討論了層壓板（製造印刷電路板的關鍵原材料）的價格上漲和交貨時間。

We have been actively managing both supply constraints and higher raw material costs through such measures as supplier diversification, ongoing operational efficiency efforts, and quotation adjustments to mitigate the impact to TTM. The magnitude of the impact to our cost of goods sold will be larger in Q3 and Q4 since higher laminate prices in Q1 and Q2 takes some time to work through our suppliers and inventory. I am proud of how TTM employees have worked to deliver excellent performance despite the formidable challenges of this environment.

我們一直在透過供應商多元化、持續提高營運效率和報價調整等措施積極管理供應限制和較高的原材料成本，以減輕對 TTM 的影響。第三季和第四季對我們銷售商品成本的影響將會更大，因為第一季和第二季層壓板價格上漲需要一些時間來消化我們的供應商和庫存。儘管面臨嚴峻的環境挑戰，我對迅達員工仍努力提供卓越績效感到自豪。

Next, I would like to provide an update on our long-term strategy. TTM is on a journey to transform our business to be less cyclical and more differentiated. We believe that over time investors will be rewarded with more stable growth, strong cash flow performance, and improving margins. As part of this strategic transition, we sold our Mobility business last year. We are now able to generate more consistent cash flow with our strong set of technologies and broad exposure to longer-cycle end markets.

接下來，我想介紹一下我們的長期策略的最新情況。 TTM 正在努力將我們的業務轉型為更少的周期性和更具差異化的業務。我們相信，隨著時間的推移，投資者將獲得更穩定的成長、強勁的現金流表現和不斷提高的利潤率。作為這項策略轉型的一部分，我們去年出售了行動業務。現在，我們能夠憑藉強大的技術和對較長週期終端市場的廣泛接觸，產生更穩定的現金流。

In the second quarter, we generated $56.9 million of cash from operations or 10% of revenue. A key part of our ongoing strategy will be to add capabilities and products that are complementary to our current offerings, both internally and through acquisitions.

第二季度，我們從營運中產生了 5,690 萬美元的現金，佔收入的 10%。我們持續策略的關鍵部分是透過內部和收購增加與我們目前產品互補的能力和產品。

Looking forward, our balance sheet is in a strong position to further acquisition -- to pursue further acquisitions as well as to support our organic investment needs. Another benefit of our strategic shift is the seasonality of our business. Historically, we experienced significant seasonality in revenues with a softer first half and ramping volumes in the third quarter, which usually peaked in the fourth quarter. Post the Mobility divestiture, this pattern has changed. We now experienced modest seasonal softness in the first and third quarters due to holidays and vacation periods in China and North America, respectively. And stronger revenue levels in the second and fourth quarters. This seasonality, combined with some pull-forward of demand from Q3 into Q2, is resulting in a sequential decline in our revenue guidance.

展望未來，我們的資產負債表處於進一步收購的有利地位—尋求進一步收購並支持我們的有機投資需求。我們策略轉變的另一個好處是我們業務的季節性。從歷史上看，我們的收入經歷了顯著的季節性，上半年較疲軟，第三季銷售量不斷增加，通常在第四季達到頂峰。行動業務剝離後，這種模式發生了變化。由於中國和北美的假期，我們在第一季和第三季分別經歷了適度的季節性疲軟。第二季和第四季的營收水準更為強勁。這種季節性，加上需求從第三季提前到第二季度，導致我們的營收指引連續下降。

I would also like to update you on the COVID situation. The vaccine rollout in the United States has resulted in a decline in new COVID cases, and we have seen the same dynamic within our employee base. However, many parts of the world have much lower vaccination rates and the rise of the Delta variant has led to significantly increasing case counts in a number of countries with the potential of another round of lockdowns. We are watching these developments very closely to monitor impacts on demand and supply. We are using a data-driven process, monitoring vaccination rates and the local case counts to determine safety precautions at our facilities as we welcome back visitors, begin traveling again, and return a number of our remote employees back to the workplace. Our global manufacturing facilities have been operating throughout the pandemic.

我還想向您通報新冠肺炎疫情的最新情況。美國疫苗的推出導致了新冠病例的減少，我們在我們的員工群體中也看到了同樣的動態。然而，世界許多地區的疫苗接種率要低得多，而 Delta 變種的興起導致一些國家的病例數大幅增加，有可能實施另一輪封鎖。我們正在密切關注這些事態發展，以監測對需求和供應的影響。我們正在使用數據驅動的流程，監測疫苗接種率和當地病例數，以確定我們設施的安全預防措施，因為我們歡迎回來的訪客，再次開始旅行，並使一些遠端員工返回工作場所。我們的全球製造工廠在整個疫情期間一直在運作。

Given the rapid reopening in the United States, along with the summer holiday season, we are seeing more challenges in attracting and retaining labor, which is resulting in elevated costs and production inefficiencies in North America. Our employees are paramount to the success of TTM, and we actively endeavor to demonstrate their value to our company through a combination of financial and non-financial methods. We are also hopeful that the expiration of elevated unemployment benefits in the U.S. and increased vaccination rates will encourage potential employees to join TTM as we work to support our customers.

鑑於美國的快速重新開放以及夏季假期，我們在吸引和留住勞動力方面面臨更多挑戰，這導致北美成本上升和生產效率低下。我們的員工對於迅達的成功至關重要，我們積極努力透過財務和非財務方法相結合來展示他們對我們公司的價值。我們也希望，美國高額失業救濟金的到期和疫苗接種率的提高將鼓勵潛在員工加入迅達，同時我們將努力為客戶提供支援。

Now I'd like to review our end markets. All historical end market disclosures exclude the Mobility Business Unit and the 2 E-MS plants, which halted production in December of 2020. For more details on end-market disclosures, please refer to Page 4 of our earnings presentation, which is posted on our website.

現在我想回顧一下我們的終端市場。所有歷史終端市場披露不包括移動業務部門和2 個E-MS 工廠，這些工廠於2020 年12 月停止生產。發佈在我們的網站。

The Aerospace & Defense end market represented 33% of total second quarter sales compared to 34% of Q2 2020 sales, and 36% of sales in Q1 2021. We continue to experience a positive defense climate, with our A&D program backlog at $671 million compared to $647 million a year ago. On a year-on-year basis, Defense continues to outperform commercial Aerospace, which saw meaningful year-on-year declines in the quarter.

航空航太與國防終端市場佔第二季總銷售額的33%，而2020 年第二季銷售額為34%，2021 年第一季銷售額為36%。 A&D 專案積壓金額為6.71 億美元，而2020 年第二季銷售額為34%，2021 年第一季銷售額為36%。與去年同期相比，國防領域的表現持續優於商業航空航太領域，商業航空航太領域在本季出現了大幅同比下降。

The relative stability in the Defense market is a result of our strong strategic program alignment and key bookings for ongoing franchise programs. We saw significant bookings in the quarter for Northrop's upgrade of F-16 fighter jets with scalable agile beam radar. We expect sales in Q3 from this end market to represent about 33% of our total sales.

國防市場的相對穩定是我們強有力的戰略計劃調整和正在進行的特許經營計劃的關鍵預訂的結果。我們在本季看到諾斯羅普公司對配備可擴展敏捷波束雷達的 F-16 戰鬥機升級的大量預訂。我們預計第三季該終端市場的銷售額將占我們總銷售額的 33% 左右。

The Medical, Industrial, Instrumentation end market contributed 19% of our total sales in the second quarter compared to 21% in the year-ago quarter and 17% in the first quarter of 2021. The MI&I market exceeded $100 million quarterly run-rate and performed much better than expectations, as Instrumentation customers in the semiconductor capital equipment end market were stronger than expected, and Medical as well as Industrial customers rebounded. For the third quarter we expect MI&I to be 18% of revenues.

醫療、工業、儀器終端市場佔第二季總銷售額的 19%，去年同期為 21%，2021 年第一季為 17%。半導體資本設備終端市場的儀器儀表客戶強於預期，醫療和工業客戶出現反彈。我們預計第三季 MI&I 將佔營收的 18%。

Automotive sales represented 18% of total sales during the second quarter of 2021 compared to 11% in the year ago quarter, and 17% during the first quarter of 2021. Automotive grew almost 80% year-over-year and continued to grow sequentially above our expectations, exceeding $100 million quarterly run-rate, which is a level not seen since 2018. We are aware that the shortage of semiconductors is currently limiting automotive production, but this phenomena has not directly affected our business since we do not purchase semiconductors.

2021 年第二季汽車銷量佔總銷售量的 18%，而去年同期為 11%，2021 年第一季為 17%。率超過1 億美元，這是我們的預期，這是自2018 年以來從未見過的水平。購買半導體。

While we are monitoring this situation closely, to date, it has had very limited indirect impact on our non -- on our PCB demand. We expect Automotive to contribute 19% of total sales in Q3.

雖然我們正在密切關注這一情況，但迄今為止，它對我們的非 PCB 需求的間接影響非常有限。我們預計汽車產業將佔第三季總銷售額的 19%。

Networking, Communications accounted for 15% of revenue during the second quarter of 2021. This compares to 19% in the second quarter of 2020 and 15% of revenue in the first quarter of 2021. We saw relative strength on a year-on-year basis in Networking compared to telecom as the 5G build-out in China faced difficult year-on-year comparisons. In Q3, we expect this end market to be 15% of revenue.

網路、通訊佔 2021 年第二季營收的 15%。 5G 建設面臨艱難的年比比較。在第三季度，我們預計該終端市場將佔營收的 15%。

Sales in the Data Center Computing end market represented 14% of total sales in the second quarter compared to 13% in Q2 of 2020, and 14% in the first quarter of 2021. This end market was up 15% year-on-year, due primarily to growth from our Data Center customers. We expect revenues in this end market to represent approximately 14% of third quarter sales as Data Center continues to drive year-on-year growth.

資料中心計算終端市場的銷售額佔第二季總銷售額的 14%，而 2020 年第二季為 13%，2021 年第一季為 14%。數據中心客戶的成長。由於資料中心持續推動年成長，我們預計該終端市場的營收將佔第三季銷售額的 14% 左右。

Next, I'll cover some details from the second quarter. All of the following operations metrics exclude the Mobility Business unit and the 2 E-MS plants that we closed. This information is also available on Page 5 of our earnings presentation.

接下來，我將介紹第二季的一些細節。以下所有營運指標均不包括行動業務部門和我們關閉的 2 家 E-MS 工廠。此資訊也可在我們的收益簡報的第 5 頁上找到。

During the quarter, our Advanced Technology business, which includes HDI, Rigid Flex, and RF Subsystems and Components, accounted for approximately 31% of our revenue. This compares to approximately 28% in the year ago quarter, and 31% in Q1. We are continuing to pursue new business opportunities and increased customer design engagement activities that will leverage our Advanced Technology capabilities in new programs and new markets.

本季度，我們的先進技術業務（包括 HDI、剛性柔性電路板以及射頻子系統和組件）約占我們收入的 31%。相比之下，去年同期約為 28%，第一季約為 31%。我們將繼續尋求新的商機並增加客戶設計參與活動，這將在新項目和新市場中利用我們的先進技術能力。

Capacity Utilization in Asia Pacific was 88% in Q2 compared to 70% in the year ago quarter, and 80% in Q1. Our overall Capacity Utilization in North America was 49% in Q2 compared to 63% in the year ago quarter, and 55% in Q1, as we added plating capacity in 2 of our North American sites for the first time in several years. Our top 5 customers contributed 29% of total sales in the second quarter of 2021 compared to 33% in the first quarter of 2021. We did not have any customers above 10% in the quarter.

第二季亞太地區的產能利用率為 88%，去年同期為 70%，第一季為 80%。第二季我們北美的整體產能利用率為 49%，而去年同期為 63%，第一季為 55%，因為我們幾年來首次在北美的 2 個工廠增加了電鍍產能。我們的前 5 位客戶在 2021 年第二季貢獻了總銷售額的 29%，而 2021 年第一季為 33%。

At the end of Q2, our 90-day backlog, which is subject to cancellations, was $553.1 million compared to $436.6 million at the end of the second quarter last year, and $540.5 million at the end of Q1. Our PCB book-to-bill ratio was 1.26% for the 3 months ending June 28th.

截至第二季末，我們的 90 天積壓訂單（可能會被取消）為 5.531 億美元，而去年第二季末為 4.366 億美元，第一季末為 5.405 億美元。截至 6 月 28 日的 3 個月，我們的 PCB 訂單出貨比為 1.26%。

I'd like to conclude by again thanking our employees for continuing to contribute to TTM, and our critical mission of inspiring innovation with our customers. Despite the raw materials and labor-related challenges we are facing, our business performed better than we expected as a direct result of our employees and our supply chain partners' concerted efforts to support TTM and our customers.

最後，我想再次感謝我們的員工繼續為迅達做出貢獻，以及我們與客戶一起激發創新的重要使命。儘管我們面臨與原材料和勞動力相關的挑戰，但我們的業務表現比我們預期的要好，這是我們的員工和供應鏈合作夥伴共同努力支持迅達和客戶的直接結果。

Now Todd will review our financial performance for the second quarter. Todd?

現在托德將回顧我們第二季的財務表現。托德？

Thanks, Tom, and good afternoon, everyone. I'll be reviewing our financial results for the second quarter, which are also shown in the press release distributed today, as well as on Page 7 of our earnings presentation which is posted on our website.

謝謝湯姆，大家下午好。我將回顧我們第二季的財務業績，這些業績也顯示在今天發布的新聞稿中，以及我們網站上發布的收益簡報的第 7 頁。

For the second quarter, net sales were $567.4 million compared to $570.3 million from continuing operations in the second quarter of 2020. The year-over-year decrease in revenue was due to the closure of our 2 E-MS facilities, which generated $21 million of revenues in Q2 of last year, and no revenues in this most recent quarter. Excluding that impact, revenues of our ongoing business grew 3.4% year-on-year as growth in our Automotive and Data Center Computing end markets more than offset declines in other end markets.

第二季淨銷售額為5.674 億美元，而2020 年第二季持續營運銷售額為5.703 億美元。收入去年第二季的收入，最近一個季度沒有收入。排除這一影響，我們持續業務的收入年增 3.4%，因為我們的汽車和資料中心計算終端市場的成長遠遠抵消了其他終端市場的下降。

GAAP operating income for the second quarter of 2021 was $40.9 million compared to GAAP operating income from continuing operations of $23 million in the second quarter of 2020. On a GAAP basis, net income in the second quarter of 2021 was $28.3 million or $0.26 per diluted share. This compares the net income from continuing operations of $9.3 million or $0.09 per diluted share in the second quarter of last year.

2021 年第二季的GAAP 營業收入為4,090 萬美元，而2020 年第二季的GAAP 持續經營營業收入為2,300 萬美元。淨利潤為0.26 美元分享。相比之下，去年第二季持續經營淨利為 930 萬美元，即稀釋後每股收益 0.09 美元。

The remainder of my comments will focus on our non-GAAP financial performance. Our non-GAAP performance excludes our divested Mobility Business Unit, non-routine tax items, M&A-related costs, restructuring costs, certain non-cash expense items, and other unusual or infrequent items. We present non-GAAP financial information to enable investors to see the company through the eyes of management and to facilitate comparison with expectations and prior periods.

我其餘的評論將集中於我們的非公認會計準則財務表現。我們的非公認會計準則績效不包括我們剝離的行動業務部門、非常規稅務項目、併購相關成本、重組成本、某些非現金費用項目以及其他不尋常或不常見的項目。我們提供非公認會計準則財務信息，使投資者能夠透過管理層的視角了解公司，並便於與預期和前期進行比較。

Gross margin in the second quarter was 18% compared to 18.4% in the second quarter of 2020. The year-on-year decline was largely due to the appreciation of the Chinese currency versus the U.S. dollar in our China facilities, and production inefficiencies in certain North American plants.

第二季的毛利率為 18%，而 2020 年第二季的毛利率為 18.4%。

Selling and marketing expense was $14.2 million in the second quarter or 2.5% of net sales versus $15.7 million or 2.7% of net sales a year ago. Second quarter G&A expense was $28.6 million or 5% of net sales compared to $30.4 million or 5.3% of net sales in the same quarter a year ago. In the second quarter, R&D was $4.1 million or 0.7% of revenues compared to $5.2 million or 0.9% in the year ago quarter.

第二季銷售和行銷費用為 1,420 萬美元，佔淨銷售額的 2.5%，而去年同期為 1,570 萬美元，佔淨銷售額的 2.7%。第二季管理及行政費用為 2,860 萬美元，佔淨銷售額的 5%，去年同期為 3,040 萬美元，佔淨銷售額的 5.3%。第二季研發費用為 410 萬美元，佔營收的 0.7%，去年同期為 520 萬美元，佔營收的 0.9%。

Our operating margin in the second quarter was 9.7%. This compares to 9.4% in the same quarter last year. Interest expense was $10.5 million in the second quarter, a decrease from the $15 million in the same quarter last year due to lower levels of debt as we repaid $400 million of our Term Loan and our $250 million convertible bond, as well as lower interest expense following our debt refinancing in the first quarter.

我們第二季的營業利益率為 9.7%。相比之下，去年同期為 9.4%。第二季利息支出為1,050 萬美元，較去年同期的1,500 萬美元有所下降，原因是我們償還了4 億美元的定期貸款和2.5 億美元的可轉換債券，債務水平較低，而且利息支出也較低繼第一季的債務再融資之後。

During the quarter, there was a negative $1.8 million foreign exchange impact below the operating line. Government incentives and interest income reduces to a negative $0.7 million or approximately $0.01 of EPS. This compares to a gain of $0.2 million in the second quarter a year ago.

本季度，營業線以下匯率產生了 180 萬美元的負面影響。政府激勵和利息收入減少至負 70 萬美元，即 EPS 約 0.01 美元。相比之下，去年第二季的收益為 20 萬美元。

Our effective tax rate was 8.7% in the second quarter. Second quarter net income was $40 million or $0.36 per diluted share. This compares to second quarter 2020 net income of $33 million or $0.31 per diluted share.

第二季我們的有效稅率為 8.7%。第二季淨利為 4,000 萬美元，或攤薄後每股收益 0.36 美元。相比之下，2020 年第二季淨利為 3,300 萬美元，即稀釋後每股收益 0.31 美元。

Adjusted EBITDA for the second quarter was $75.6 million or 13.3% of net sales, compared with second quarter 2020 adjusted EBITDA of $76.8 million or 13.5% of net sales. Depreciation for the quarter was $21.2 million. Net capital spending for the quarter was $22.7 million.

第二季調整後 EBITDA 為 7,560 萬美元，佔淨銷售額的 13.3%，而 2020 年第二季調整後 EBITDA 為 7,680 萬美元，佔淨銷售額的 13.5%。該季度的折舊為 2,120 萬美元。該季度淨資本支出為 2,270 萬美元。

An ongoing focus for us is cash flow from operations. During the second quarter, we continued to deliver consistently strong results, generating $56.9 million or 10% of revenue from operations. Our balance sheet and liquidity positions remain very strong. Cash and cash equivalents at the end of the second quarter of 2021 were $558.3 million, and our net debt divided by last 12 months' EBITDA was 1.4x.

我們持續關注的焦點是營運現金流。第二季度，我們繼續取得持續強勁的業績，創造了 5,690 萬美元，佔營運收入的 10%。我們的資產負債表和流動性狀況仍然非常強勁。截至 2021 年第二季末，現金和現金等價物為 5.583 億美元，我們的淨債務除以過去 12 個月的 EBITDA 為 1.4 倍。

We are using that strength to repurchase stock and to avoid issuing new shares related to our warrants. We previously announced $100 million stock repurchase program. And during the second quarter, we bought back 411,000 shares for $6.1 million. We also spent $3.1 million to cash settle 60% of the stock warrants that matured during the quarter, thus avoiding the issuance of approximately 210,000 shares.

我們正在利用這項優勢回購股票，並避免發行與我們的認股權證相關的新股。我們之前宣布了 1 億美元的股票回購計畫。第二季度，我們以 610 萬美元回購了 411,000 股股票。我們也花了 310 萬美元現金結算本季到期的 60% 認股權證，從而避免發行約 21 萬股。

Now I'd like to turn to guidance for the third quarter. As Tom stated earlier, the nature and amount of seasonality we experience has changed since the divestiture of the Mobility business. As a result of that change and the demand pull forward into Q2 that we witnessed, we expect sequentially lower revenue in Q3.

現在我想談談第三季的指導。正如湯姆之前所說，自從剝離移動業務以來，我們所經歷的季節性的性質和數量已經發生了變化。由於這項變化以及我們目睹的需求提前到第二季度，我們預計第三季的營收將連續下降。

In addition, we expect a larger inflationary impact in Q3 which will contribute to lower sequential operating margins. Given that, we expect total revenue for the third quarter of 2021 to be in the range of $530 million to $570 million, and we expect non-GAAP earnings to be in the range of $0.31 to $0.37 per diluted share. The EPS forecast is based on a diluted share count of approximately 109 million shares. Our share count guidance includes dilutive securities such as options and RSUs, but no shares associated with our warrants as the current stock price is under the stock of the strike price of $14.26.

此外，我們預期第三季通膨影響更大，這將導致營業利潤率下降。有鑑於此，我們預計 2021 年第三季的總收入將在 5.3 億美元至 5.7 億美元之間，並且我們預計非 GAAP 稀釋每股收益將在 0.31 美元至 0.37 美元之間。 EPS 預測是基於約 1.09 億股的稀釋股數。我們的股數指引包括選擇權和 RSU 等稀釋性證券，但沒有與我們的認股權證相關的股票，因為目前股價低於 14.26 美元的執行價格。

We expect that SG&A expense will be about 8.2% of revenue in the third quarter, and R&D will be about 0.9% of revenue. We expect interest expense to total approximately $10 million. Finally, we estimate our effective tax rate to be 10%.

我們預計第三季SG&A費用將佔營收的8.2%左右，研發費用將佔營收的0.9%左右。我們預計利息支出總計約 1000 萬美元。最後，我們估計有效稅率為 10%。

To assist you in developing your financial models, we offer the following additional information. During the third quarter, we expect to record amortization of intangibles of about $9.7 million, stock-based compensation expense of about $5 million, non-cash interest expense of approximately $0.5 million, and we estimate depreciation expense will be approximately $21 million.

為了幫助您開發財務模型，我們提供以下附加資訊。在第三季度，我們預計無形資產攤銷約為 970 萬美元，股票補償費用約為 500 萬美元，非現金利息費用約為 50 萬美元，我們預計折舊費用約為 2,100 萬美元。

Finally, I'd like to announce that we will be participating virtually in the Jefferies Industrial Conference on August 3rd, the Needham Industrial Technology Conference on August 9th, and the Jefferies IT Hardware, Communications Infrastructure Conference on August 31st.

最後，我想宣布，我們將以虛擬方式參加 8 月 3 日的 Jefferies 工業會議、8 月 9 日的 Needham 工業技術會議以及 8 月 31 日的 Jefferies IT 硬體、通訊基礎設施會議。

That concludes our prepared remarks, and now I'd like to open the line for questions. Travis?

我們準備好的發言就到此結束，現在我想開始提問。崔維斯？

(Operator Instructions) Our first question comes from William Stein, Truist Securities.

（操作員指示）我們的第一個問題來自 Truist Securities 的 William Stein。

Congrats on the good quarterly results. I think op margin took a nice tick up to 9.7% in the quarter. I recall you have historically had a 12% to 14% target on this metric, but that was before the divestitures that you did. And I'm wondering whether you still think 12% to 14% is a good target and whether you have a time frame that you have in mind to achieve it?

祝賀取得了良好的季度業績。我認為本季營運利潤率大幅上升至 9.7%。我記得您歷來對該指標設定了 12% 到 14% 的目標，但那是在您進行資產剝離之前。我想知道您是否仍然認為 12% 至 14% 是一個好的目標，以及您是否有實現該目標的時間框架？

I'll take that one. Good to hear your voice again, Will. In response to your question, yes, we still believe in those targets. The key for us was a couple of things. One was getting our utilization levels up in Asia, and we're starting to see that point now. So that's a very favorable development. And then second is continuing to grow our Aerospace and Defense business, particularly our RF components and Subassemblies portion of that business, which has better than usual PCB fabrication margins. So that's a key element that needs to continue -- that we need to continue to drive.

我會接受那個。很高興再次聽到你的聲音，威爾。回答你的問題，是的，我們仍然相信這些目標。對我們來說，關鍵有幾件事。其中之一是提高我們在亞洲的利用率水平，我們現在開始看到這一點。所以這是一個非常有利的發展。其次是繼續發展我們的航空航太和國防業務，特別是該業務中的射頻元件和組件部分，該業務的 PCB 製造利潤率高於平常。所以這是一個需要繼續的關鍵因素——我們需要繼續推動。

And then the other thing we have to do is, some of the good news that we would have expected to have seen already from the improved utilization in Asia has been a little bit muted by the inflationary costs that we've been seeing in terms of raw materials that Tom commented on in his opening remarks, as well as we're seeing a tighter labor force. So we have challenges getting the labor. And then obviously, as a result of that, you're seeing some price inflation or wage inflation from the labor too. So those 2 elements are working against us, headwinds, if you will, that are muting the benefit that we would normally see from the growth and the improved utilization in Asia. But those are -- I view as temporary things that we will work through, mitigating through ongoing cost management actions as well as pricing actions. So I view those as transitionary or temporary in nature. But they will be with us here, have been for a quarter or 2 and probably will be for a couple of more quarters.

然後，我們必須做的另一件事是，我們原本期望從亞洲利用率提高中看到的一些好消息，由於我們在以下方面看到的通貨膨脹成本而被削弱了一點：湯姆在開場白中談到的原料問題，以及勞動力緊張的情況。因此，我們在獲得勞動力方面面臨挑戰。顯然，因此，你也會看到勞動力帶來的一些物價通膨或薪資通膨。因此，這兩個因素對我們不利，如果你願意的話，這就是逆風，這削弱了我們通常從亞洲的成長和利用率提高中看到的好處。但我認為這些都是暫時的事情，我們將透過持續的成本管理行動以及定價行動來解決這些問題。所以我認為這些本質上是過渡性的或暫時性的。但他們會和我們在一起，已經待了一兩個季度了，可能還會再待幾個季度。

A follow-up to that, Todd. I appreciate it. But I just want to dig into that a little bit more with regard to the inflationary cost -- input costs. Labor is one thing. But on the material side, we've seen among other component suppliers, in particular, semis, but other components as well. We've seen a very, I'd say, a strong willingness and ability -- well, a willingness among the suppliers and also willingness among the -- pardon, willingness among the sellers, but a willingness also among the buyers to accept higher prices in this environment. Lead times are stretched. Maybe they're not quite as stretched for your parts. Their input costs are going up, in particular, costs at Foundry, semiconductor costs are going up. Semis are raising prices to their customers pretty well across the board, even in markets where you really don't expect this, namely automotive, and the customers are paying it. I'm wondering if this is a matter of -- well, I'm wondering why we're not seeing that in your business really, is what I concern to?

托德，後續行動。我很感激。但我只是想更深入地探討通貨膨脹成本——投入成本。勞動是一回事。但在材料方面，我們看到了其他零件供應商，特別是半成品，但也看到了其他零件。我想說，我們看到了一種非常強烈的意願和能力——嗯，供應商之間的意願，以及賣家之間的意願——赦免，但買家也願意接受更高的價格。環境下的價格。交貨時間被拉長。也許他們對你的部分沒有那麼充分的支持。他們的投入成本正在上升，特別是代工成本、半導體成本正在上升。半成品公司正在全面提高向客戶的價格，即使在你真正意想不到的市場（即汽車市場），而客戶正在為此付費。我想知道這是否是一個問題——好吧，我想知道為什麼我們在你們的業務中沒有看到這一點，這就是我所關心的嗎？

Yes. So Will, this is Tom. Let me cover that. First of all, just to explain some of the dynamics of work here in the printed circuit board business in particular, but also in our entire business. We have a set of businesses approximately, it depends on the given quarter, but if you think about 40% to 50% of our commercial business is related to more spot type non-contractual business. And then if you think about our A&D business, about half of the business in A&D is related to either, again, spot or non-contractual business, or contracts with escalation provisions. So the balance of the business, about 50%, would be related to contracts that we have with our customers. So we have, obviously, immediately as we receive increases or even forecasted increases, we're able to incorporate that in our quote models and take care of the 40% to 50% of commercial and the 50% of A&D that I talked about. It's the balance that we're really addressing now. And that takes negotiations.

是的。威爾，這是湯姆。讓我來介紹一下。首先，我想解釋一下印刷電路板業務以及我們整個業務的一些工作動態。我們大約有一組業務，這取決於給定的季度，但如果你考慮我們 40% 到 50% 的商業業務與更多現貨類型的非合約業務相關。然後，如果你考慮我們的 A&D 業務，A&D 中大約一半的業務與現貨或非合約業務或帶有升級條款的合約有關。因此，業務的其餘部分（約 50%）將與我們與客戶簽訂的合約有關。因此，顯然，當我們收到成長甚至預測成長時，我們能夠立即將其納入我們的報價模型中，並處理我談到的 40% 至 50% 的商業和 50% 的 A&D。這是我們現在真正要解決的平衡問題。這需要談判。

Obviously, the best time to negotiate with the contractual customers is when the contract comes up for renewal, which we which they do. We -- most of our contractual relationships come up for renewal every year, if not more often. And so that's when you have your price negotiation. In some cases, we've had to go back to even those customers and talk about the present situation and ask for their understanding. I would say that on balance, we've been able to mitigate approximately 75% of that -- of the increases that we've been receiving. And frankly, I consider that that's pretty good given the portion of our business that is contractual.

顯然，與合約客戶談判的最佳時機是合約續約時，我們也是這樣做的。我們——我們的大多數合約關係每年都會更新，甚至更頻繁。這就是您進行價格談判的時候。在某些情況下，我們甚至不得不回到那些客戶那裡，談論目前的情況並請求他們的理解。我想說的是，總的來說，我們已經能夠減少大約 75% 的增量——我們已經收到了增量。坦白說，考慮到我們的合約業務部分，我認為這相當不錯。

We've also, of course, as we always do, we're focused on the cost side of the equation and improving our operational efficiencies, and that's a constant for us. So that continues to be the other area of focus. And as we go through contractual negotiations with our customers, we'll be talking through the pricing situation. So that's how -- that's really the how it works in the printed circuit board world, and we're going to continue to work through this. And as Todd said, we have confidence that we'll be able to mitigate. It's just a question of time as we work through those mitigation strategies.

當然，我們也像往常一樣，專注於成本方面並提高我們的營運效率，這對我們來說是一個常數。因此，這仍然是另一個重點領域。當我們與客戶進行合約談判時，我們將討論定價情況。這就是印刷電路板世界的運作方式，我們將繼續解決這個問題。正如托德所說，我們有信心減輕影響。我們實施這些緩解策略只是時間問題。

(Operator Instructions) Our next question comes from Jim Ricchiuti, Needham & Company.

（操作員說明）我們的下一個問題來自 Needham & Company 的 Jim Ricchiuti。

I may have missed it, but you're talking about pull-ins. Can you say -- elaborate on where you are seeing the pull-ins, which market verticals? And maybe what was driving and how unusual is that to see?

我可能錯過了，但你說的是拉入。您能否詳細說明您在哪些地方看到了拉動，哪些垂直市場？也許是什麼在驅動著這一切，這有多麼不尋常？

Yes, sure. And predominantly, where we saw that was in our -- in the Data Center Computing end market and a little bit in the Networking, on the Networking side as well. And not unusual, Jim, the -- if you look at the blending of Q2, Q3. And so I would consider that sort of not -- it's normal to think about it in terms of multiple quarters. And generally, we were -- because in Q2, as we highlighted, Q2 we have that many more days of production in North America, coupled with the excellent utilization rates that we have in Asia Pacific. So we were able to push that product out and our customers were pulling that product. As we go into Q3 here in those 2 areas, we're expecting that we'll see a little bit of a more subdued demand, but really on the edges, if you will, still a very strong environment. And then the other factor is just the ability with vacations in North America, Q3 is always going to be, from a production output standpoint, a lower production output quarter for us versus Q2. So those are the 2 factors that we're absorbing at this point in Q3.

是的，當然。我們看到的主要是在資料中心計算終端市場以及網路方面。吉姆，這並不罕見——如果你看看 Q2、Q3 的混合。因此，我認為這種情況不是——從多個季度的角度來考慮它是正常的。總的來說，我們是——因為在第二季度，正如我們所強調的那樣，第二季度我們在北美的生產天數更多，再加上我們在亞太地區的利用率很高。因此，我們能夠推出該產品，而我們的客戶也正在撤回該產品。當我們進入這兩個領域的第三季時，我們預計需求會減弱，但如果你願意的話，確實處於邊緣，仍然是一個非常強勁的環境。然後另一個因素是北美的假期能力，從產量的角度來看，第三季我們的產量總是低於第二季。這些是我們在第三季此時吸收的兩個因素。

And I don't know if you want to size it, quantify it, Tom. And the other question, the last question I have is just on the utilization rates. You guys alluded to the higher utilization rates in Asia Pacific. But I'm just wondering, are you at all concerned about your North American utilization rates?

我不知道你是否想確定它的大小、量化它，湯姆。另一個問題，我的最後一個問題是關於利用率。你們提到了亞太地區更高的利用率。但我只是想知道，您是否關心北美的利用率？

Yes, I think the way to look at it on -- in terms of sizing is just look at the end market forecast that we provided. And if you look at sort of Q3 versus Q2, you'll see in the Data Center area down about 6% and Networking telecom down about 2%. Bulk of that's going to be related to the inventories and sort of that quarter-to-quarter blurring, if you will, of the demand. And then if you look at A&D Q3 to Q2, down about 3%, and a portion of MII, which is down again about 6%. That's more related to production limitations in North America. So that's how -- a good way to look at it.

是的，我認為在規模方面看待它的方法是看看我們提供的最終市場預測。如果你比較第三季和第二季度，你會發現資料中心領域下降了約 6%，網路電信領域下降了約 2%。其中大部分將與庫存以及季度與季度之間的需求模糊（如果你願意的話）有關。然後，如果你看看 A&D 第三季度到第二季度，下降了約 3%，而 MII 的一部分又下降了約 6%。這更與北美的生產限制有關。這就是看待問題的好方法。

If -- in terms of utilization, I can't tell you how excited we are about -- it's funny to say that. Yes, North America utilization rates are down. But what that really signifies is the fact that we added 2 plating lines in the quarter. And those are vertical plating lines. They are core to our process, represents a -- our ability in the future here to respond to the robust demand that we are feeling out there in the marketplace and to continue our ability to respond to quick-turn requirements as well in those facilities. We obviously have to continue to work on our staffing in our North America facilities, but this gives us the equipment capacity that we need, particularly in those 2 facilities that were bottlenecked by plating. And again, adding plating lines, great indicator to our customers that we are prepared to service their heightened demand levels.

如果——就利用率而言，我無法告訴你我們有多興奮——這麼說很有趣。是的，北美的利用率正在下降。但這真正意味著我們在本季增加了 2 條電鍍線。這些是垂直電鍍線。它們是我們流程的核心，代表我們未來有能力響應我們在市場上感受到的強勁需求，並繼續我們有能力響應這些設施中的快速週轉要求。顯然，我們必須繼續在北美工廠的人員配備上進行工作，但這為我們提供了所需的設備能力，特別是在那些因電鍍而受到瓶頸的工廠中。再次，增加電鍍線，向我們的客戶表明我們已準備好滿足他們更高的需求水平。

Next question comes from Matt Sheerin, Stifel.

下一個問題來自 Stifel 的 Matt Sheerin。

Just a question regarding the margin headwinds that you're seeing both on the labor side and on the materials side. It sounds like -- and you're not the only one saying conditions have probably worsened today since a quarter or 2 ago. Do you have any visibility into sort of when this stabilizes? And it sounds like you're catching up a little bit on passing those costs along. But do you see any further progress in the December quarter?

只是一個關於您在勞動力方面和材料方面看到的利潤逆風的問題。聽起來——而且你並不是唯一一個說自一兩個季度以來情況可能已經惡化的人。您是否知道這種情況何時會穩定下來？聽起來你在轉嫁這些成本方面正在趕上一些。但您認為 12 月季度有任何進一步進展嗎？

So kind of to add to what Tom said earlier about the process and how we can deal with pricing in our process. What we've seen now is increases over a period of time. They've been working themselves through the pipeline at our suppliers and then to our inventory and then out to customers. And as we try to balance that cost increase, which we've seen pretty steadily and significantly over the last few quarters. We're now -- we're working to kind of try to get in front of that and work with our customers on pricing. But on that 50% or so of the revenue stream that takes longer to deal with, that Tom was referring to earlier, we're making progress. Q3 has got a bit of a gap.

因此，對湯姆之前所說的有關流程以及我們如何處理流程中的定價的內容進行補充。我們現在看到的是一段時間內的成長。他們一直在我們的供應商的管道中工作，然後到我們的庫存，然後到客戶。當我們試圖平衡成本成長時，我們在過去幾季中看到成本成長相當穩定且顯著。我們現在正在努力解決這個問題，並與我們的客戶就定價進行合作。但湯姆之前提到的 50% 左右的收入流需要更長的時間來處理，我們正在取得進展。第三季有一些差距。

We did really well, I think, in Q2. It was a smaller hill decline. The team did a really good job getting in front of it and working with customers and more or less mitigated the impact of that particular component of inflation for our business. In Q3, though, these costs keep ramping. And we've been working with our customers, and we see it into Q4.

我認為我們在第二季度做得非常好。這是一個較小的山坡。團隊在應對這一問題並與客戶合作方面做得非常好，或多或少減輕了通貨膨脹這一特定因素對我們業務的影響。然而，在第三季度，這些成本持續上升。我們一直在與客戶合作，我們預計將在第四季度實現這一目標。

At this point, we don't -- it's hard to forecast all of customers -- all of our suppliers are going to be -- continue to increase pricing on us in August and September. But where we are today, we're implementing solutions to mitigate what we see today. And that will have a better benefit in Q4 than in Q3. We have better coverage already. Tom alluded to the 75% or so. I liken it a climbing a mountain and we're 75% of the way up that mountain in Q3, and the team is still working hard to try to get over that hump, but it's going to be tougher this quarter. But the Q4 piece of that, we're in a better position because we have more runway, and we've been working that issue for a longer period of time. That is, of course, subject to what our suppliers might continue to do to us here over the next few months. That is a moving target that has been increasing here over time. But we think we've got a plan in place. We're executing, we're closing that gap. We think Q3 at this point looks to be the most challenging quarter from that perspective, but that's subject to what happens in the marketplace from our suppliers, as we go forward here.

目前，我們不會——很難預測所有客戶——我們所有的供應商都會——在八月和九月繼續提高我們的價格。但我們今天所處的位置，正在實施解決方案來緩解我們今天所看到的情況。這將在第四季帶來比第三季更好的效益。我們已經有了更好的覆蓋範圍。湯姆提到了 75% 左右。我把它比作爬山，第三季我們已經完成了 75% 的任務，團隊仍在努力克服這個困難，但本季會更加困難。但在第四季度，我們處於更好的位置，因為我們有更多的跑道，而且我們已經花了更長的時間來解決這個問題。當然，這取決於我們的供應商在接下來的幾個月中可能繼續對我們做的事情。這是一個不斷變化的目標，隨著時間的推移，這個目標一直在增加。但我們認為我們已經制定了計劃。我們正在執行，我們正在縮小這一差距。我們認為，從這個角度來看，第三季度似乎是最具挑戰性的季度，但這取決於我們的供應商在市場上發生的情況，因為我們在這裡前進。

Yes. And I'd only add, Matt, that we -- so that -- what Todd was talking about also is inclusive of what we are seeing or forecasting with -- from our vendors as we look at their -- what we understand to be their plans. And as you know, this is sort of -- these are the times when you really understand the true partnership with vendors. The vendors that are able to forecast and that are doing their utmost to meet demand requirements in a transparent fashion. Those are the 2 partners, and we have a number of them that really have stepped up. And so from that standpoint, we really are trying to understand where the market is going and make sure that our customers understand that as well.

是的。馬特，我只想補充一點，托德所談論的內容也包括我們從我們的供應商那裡看到或預測的內容，我們了解他們的情況他們的計劃。如您所知，這是您真正了解與供應商的真正合作夥伴關係的時候。供應商能夠預測並盡最大努力以透明的方式滿足需求。這就是兩位合作夥伴，我們有很多人確實已經挺身而出。因此，從這個角度來看，我們確實在努力了解市場的走向，並確保我們的客戶也了解這一點。

Okay. And could you remind us what percentage of cost of goods is represented by the laminate, the copper-clad laminate?

好的。您能否提醒我們層壓板（覆銅層壓板）佔商品成本的百分比是多少？

So it is probably our single largest material cost that goes into our overall cost of goods sold. And in total, if you look at laminate as a percentage of our total cost of goods sold, it's about 14.5%. If you look at all of the copper-related stuff and precious metals that we use, it's maybe in aggregate about 20% of our total cost of goods sold, is really what we're talking about here.

因此，這可能是我們最大的單一材料成本，占我們銷售商品的總成本。總的來說，如果你看看層壓板占我們銷售商品總成本的百分比，它約為 14.5%。如果你看看我們使用的所有與銅相關的材料和貴金屬，它們總共可能占我們銷售商品總成本的 20% 左右，這正是我們在這裡討論的。

Okay. That's helpful. And then just secondly -- my second question, just regarding M&A, Tom, and obviously, that's been a key part of your growth strategy and you've had a lot of success with integrating acquisitions and Anaren, obviously, broadened your product portfolio. What's your thoughts there in terms of opportunities? Obviously, your balance sheet has been improving. What should we think about the M&A here?

好的。這很有幫助。其次，我的第二個問題，關於併購，湯姆，顯然，這是您成長策略的關鍵部分，您在整合收購和 Anaren 方面取得了很大成功，顯然，擴大了您的產品組合。您對機會有何看法？顯然，您的資產負債表一直在改善。我們該如何看待這裡的併購？

Yes. I think you pointed out, it has been core to our strategy, and it will continue to be a critical element of our strategy. We're still working the revenue synergies, if you will, on the Anaren side, and that certainly on the commercial side of the business, that involves the cross-selling efforts that we're involved in. And then there's a very close relationship between our RF component design efforts and our printed circuit board support. And so we've -- obviously, it's now -- we're approaching -- well, we've been 3 years. And that relationship now is just optimal.

是的。我想你已經指出，它一直是我們策略的核心，並且將繼續是我們策略的關鍵要素。如果你願意的話，我們仍在努力實現收入協同效應，在 Anaren 方面，當然在業務的商業方面，這涉及我們參與的交叉銷售工作 然後有一種非常密切的關係我們的射頻元件設計工作和印刷電路板支撐之間的關係。所以我們——顯然，現在——我們正在接近——嗯，我們已經三年了。現在這種關係剛剛好。

And so we have a product now that is out in the market. We've been building our catalog beyond just couplers and resistors and adding transceivers and other components there and actively working on new markets beyond telecom, where we've done very well, but continuing to look at opportunities in Automotive, some in optical networking as well. So I really would like to complement our team on how they continue to focus on that business development. That's really about differentiation and direction that we are going in as a company.

因此，我們現在有一款產品已推出市場。我們一直在建立耦合器和電阻器之外的目錄，並在其中添加收發器和其他組件，並積極致力於電信以外的新市場，我們在電信領域做得很好，但繼續尋找汽車領域的機會，其中一些是光網路領域的機會出色地。因此，我真的很想補充我們的團隊如何繼續專注於業務發展。這實際上關係到我們作為一家公司的差異化和發展方向。

As we look at M&A, absolutely looking at building on that capability on the RF component side, looking at our Aerospace and Defense strength and adding engineering capability there. And then continuing to build out, make sure that we have the right footprint to support our customers on the commercial side of the business is the third element.

當我們考慮併購時，絕對會考慮在射頻組件方面建立這種能力，考慮我們的航空航太和國防實力，並增加那裡的工程能力。然後繼續擴展，確保我們有適當的足跡來支持我們的客戶在業務的商業方面是第三個要素。

And so we're continuing to work on -- work that pipeline. That's a longer-term effort for us. Strategically, the first sort of hurdle, if you will, internally, is to make sure that there's a strong strategic fit. But then over and above that, we need to make sure that acquisitions satisfy financial criteria. We continue to see elevated multiples in the market and elevated multiple expectations that will change here going forward. It always does adjust. That certainly, as we look at our second critical hurdle, which is the financial metrics, that's going to open up some of those strategic opportunities. So we're going to continue to work that. And it's a process that is very much alive and well and a critical part of our strategy, Matt.

因此，我們將繼續致力於該管道。這對我們來說是一項長期的努力。從策略上講，如果你願意的話，第一個障礙是在內部確保有強大的策略契合度。但除此之外，我們還需要確保收購符合財務標準。我們繼續看到市場的本益比不斷上升，多重預期也不斷提高，而這些都將在未來發生變化。它總是會調整。當然，當我們審視第二個關鍵障礙（即財務指標）時，這將帶來一些策略機會。所以我們將繼續努力。這是一個非常活躍和良好的過程，也是我們策略的關鍵部分，馬特。

Our next question comes from Mike Crawford, B. Riley Securities.

我們的下一個問題來自 B. Riley Securities 的 Mike Crawford。

Regarding the Automotive business, can you talk about design wins and conventional mix versus EV, which I think in the past have been around 77%? And also regarding design wins, I think in '19 and '20 combined, you had over $1 billion of design wins. So where does that stand today in 2021 and the outlook for the future?

關於汽車業務，您能談談設計勝利以及傳統組合與電動車的對比嗎？關於設計勝利，我認為在 19 年和 20 年加起來，您獲得了超過 10 億美元的設計勝利。那麼 2021 年的情況以及未來的前景如何呢？

Sure. Yes. Let me start with the design wins. We, in this most recent quarter, won about 47 new automotive design wins lifetime program value of about $121 million, and a good -- a decent portion of that was on the non-conventional side of the business. So that gives -- should give you a flavor of this most recent quarter. And what I would say in terms of the overall automotive product mix, relatively constant with what we reported last year, about 26% of the overall business was non-conventional, so Advanced Technology capability for about 26%. The balance would be conventional. And clearly, our focus continues to be on building that advanced technology content in that automotive business. And with that focus on new design wins.

當然。是的。讓我從設計勝利開始。在最近一個季度，我們贏得了約 47 個新車設計項目，生命週期項目價值約 1.21 億美元，其中很大一部分來自非傳統業務。因此，這應該能讓您了解最近一個季度的情況。我想說的是，就整體汽車產品組合而言，與我們去年報告的情況相對穩定，整體業務的約 26% 是非傳統業務，因此先進技術能力約佔 26%。平衡將是常規的。顯然，我們的重點仍然是在汽車業務中建立先進的技術內容。並透過對新設計的關注贏得勝利。

So good progress -- solid progress, I would say, in the quarter and certainly strong prospects here. And finally, just to comment on the revenue. I think we're hitting again 2018 levels, very nice to see. In particular, we saw a demand growth in Europe as a region. North America and Asia still remained at high levels, but to see Europe come in into the mix and grow was really the change quarter-to-quarter for us. So, good strong demand there.

如此良好的進展——我想說，本季度取得了堅實的進展，而且前景肯定很強勁。最後，只是對收入發表評論。我認為我們再次達到 2018 年的水平，很高興看到。特別是，我們看到歐洲地區的需求成長。北美和亞洲仍然保持在高水平，但看到歐洲加入其中並實現成長，對我們來說確實是每個季度的變化。所以，那裡的需求很好。

Okay. Thank you. And then just further regarding Advanced Technology, what percent of revenue -- I know, I assume it's quite slow as attributable to i3. And given that you divested some capabilities with the Mobility business, how important are differentiated solutions you can provide with the i3 intellectual property and assets that you acquired a couple of years ago?

好的。謝謝。然後進一步關於先進技術，收入的百分比是多少——我知道，我認為 i3 的速度相當慢。鑑於您剝離了行動業務的一些功能，您可以利用幾年前收購的 i3 智慧財產權和資產提供差異化解決方案有多重要？

Yes. So, you're right. It's, from a percentage of total revenue, still pretty small. We do track the opportunity set that comes out of our ATC, as we call it, our Advanced Technology Center. And that Advanced Technology Center in Chippewa Falls, Wisconsin, is where we moved the i3 assets. In that facility, we're doing substrate-like printed circuit board capability. We supply our own needs there for that.

是的。所以，你是對的。從佔總收入的百分比來看，它仍然很小。我們確實追蹤來自 ATC（我們稱之為先進技術中心）的機會集。位於威斯康辛州 Chippewa Falls 的先進技術中心是我們轉移 i3 資產的地方。在該工廠中，我們正在生產類似基板的印刷電路板能力。我們在那裡滿足我們自己的需求。

So fine lines and spacing, and you can think about very dense circuits. We don't break that out in terms of revenue. But I can tell you that particularly as we look at our Aerospace and Defense customer road maps, the capability is lining up very well with their interest and as well as with their own technology road maps going forward. So today, we're supporting down to about a 25-micron lines and spacing kind of area. We expect that to continue to push downward here as we go through the course of the next 5 years or so. And our plan is to support that need. So that's probably the -- what I can tell you, Mike, just good, solid progress there coming out of the ATC.

如此精細的線條和間距，你可以想像非常密集的電路。我們不會根據收入來細分。但我可以告訴你，特別是當我們查看我們的航空航太和國防客戶路線圖時，該功能與他們的興趣以及他們自己的未來技術路線圖非常吻合。所以今天，我們支援細至約 25 微米的線條和間距類型的區域。我們預計，在未來 5 年左右的時間裡，這一數字將繼續下降。我們的計劃就是支持這種需求。這可能就是——我可以告訴你的，麥克，ATC 取得了良好、堅實的進展。

Okay. And then final question, a little switching gears, but it looks like you guys are getting back into actual live trade show circuit in September with the Defense Show in London. But is that -- how does that affect business development going forward?

好的。最後一個問題，稍微轉換一下，但看起來你們將在 9 月的倫敦國防展上回到實際的現場貿易展巡迴演出。但這對未來的業務發展有何影響？

It's always better to be face-to-face. So you're absolutely right, Mike. I mean I think the -- it's been challenging for our field application engineering team and our sales team to -- they've done a great job of interacting with our customers remotely, but to be face-to-face to be able to get out to trade shows and participate again, more than anything else, it's just that as our mission is really to inspire innovation at our customers and the best way to inspire innovation is to be sitting together and helping on the design process. And also designing to meet specifications that are laid out on the table by our customers. So closer interaction is a real positive.

面對面總是更好。所以你是完全正確的，麥克。我的意思是，我認為——這對我們的現場應用工程團隊和銷售團隊來說是一個挑戰——他們在與客戶的遠程互動方面做得很好，但要面對面才能獲得信息參加貿易展並再次參加，比其他任何事情都重要，因為我們的使命實際上是激發客戶的創新，而激發創新的最佳方式就是坐在一起並幫助設計過程。並且也進行設計以滿足客戶提出的規格。因此，更密切的互動是真正積極的。

Our next question comes from Christian Schwab, Craig-Hallum.

我們的下一個問題來自克雷格·哈勒姆 (Craig-Hallum) 的克里斯蒂安·施瓦布 (Christian Schwab)。

This is Tyler on behalf of Christian. First, last quarter, you guys outlined or quantified the impact from these commodity prices and labor and FX impacts of $13 million, I believe. And I don't think I heard you quantify it this quarter, if you could. And then it appears that your Q3 guidance at the midpoint implies gross margins are going to be up sequentially, above 18%, I guess, first, is that correct? And then what's kind of the driver there?

這是泰勒代表克里斯蒂安。首先，我相信，上個季度，你們概述或量化了這些大宗商品價格以及勞動力和外匯影響的影響為 1,300 萬美元。如果可以的話，我想我沒有聽到您在本季度對其進行量化。然後，你的第三季指引似乎意味著毛利率將連續上升，超過 18%，我想，首先，這是正確的嗎？那麼那裡的司機是什麼樣的呢？

Well, to answer your first question on the second quarter, the headwinds from the inflationary issues, primarily raw material costs, we were able to mitigate those. So that really wasn't a big factor in the quarter. It will be a little more challenging in the third quarter as we look at expectations because there's a bigger mountain to climb, and we have not solutions or mitigated all of the cost pressure that we're seeing in the third quarter. So we have a bit of a shortfall there and that will impact and factors into our guidance.

好吧，回答你關於第二季的第一個問題，通貨膨脹問題（主要是原物料成本）所帶來的阻力，我們能夠減輕這些阻力。所以這確實不是本季的一個重要因素。當我們審視預期時，第三季將更具挑戰性，因為還有一座更大的山需要攀登，而且我們還沒有解決方案或減輕我們在第三季度看到的所有成本壓力。因此，我們在這方面存在一些不足，這將影響我們的指導。

When you look at our Q3 forecast and just contrasting that with Q2 because of the similarity with the inflationary factors, that becomes a bit of a challenge. Yes, you're right. Our margins -- actually, our margins are stable to -- in terms of gross margin, probably stable to slightly down. But when you get down to operating margins, that's going to trickle through, you'll see a similar effect. So, from a margin percentage standpoint as our EPS guidance would suggest, you're seeing a little bit of reduction there. And that shortfall or that decrease sequentially is really being driven by the inflationary pressures. That's the gap between our costs that are increasing and what we've been able to mitigate now. We're going to work to try to close that gap, but that's what we see as of this point in time.

當您查看我們的第三季預測並將其與第二季進行比較時，因為與通膨因素相似，這變得有點挑戰。你是對的。我們的利潤率——實際上，我們的利潤率是穩定的——就毛利率而言，可能會穩定到略有下降。但當你考慮到營業利潤率時，你會看到類似的效果。因此，從利潤率的角度來看，正如我們的每股盈餘指引所建議的那樣，你會看到那裡有點減少。這種短缺或連續減少實際上是由通膨壓力驅動的。這就是我們不斷增加的成本與我們現在能夠降低的成本之間的差距。我們將努力縮小這一差距，但這就是我們目前所看到的。

Okay. Great. And then second question, a little bit of a follow-up. Your utilization rates in the United States, you said, I think, it was 49% this quarter and below Asia. But you're encouraged with the plate and machinery you added as a bottleneck. I guess, what's kind of a target rate there at some point in the future, what's the rate in the United States?

好的。偉大的。然後是第二個問題，有點後續。你說，你在美國的利用率，我認為，本季是 49%，低於亞洲。但您對作為瓶頸添加的板材和機械感到鼓舞。我想，未來某個時候的目標利率是多少，美國的利率是多少？

Sure, sure. Yes. So we're -- in North America because so much of the business base is quick tur, you have to have excess capacity available to meet those needs. And then you also have bottlenecks that move around because of that high mix, low volume nature of the North American business. So utilization's not a great indicator of profitability, if you will, because of that. But if you were to ask, what are we -- what would we really like to see there? When we're at 60%, we're doing awfully well. If we ever started pushing to 70, we need to dramatically address that. So hopefully, that gives you a flavor. As we bring up the equipment that we've now installed, as we bring in labor, and we certainly hope we're going to start seeing better labor availability in the fall. That will help us to raise up that utilization rate above the 50% area and point towards that 60% again.

一定一定。是的。所以我們在北美，因為很多業務基礎都在快速變化，你必須有多餘的產能來滿足這些需求。此外，由於北美業務的高混合性、低產量性質，也會出現一些瓶頸。因此，如果您願意的話，利用率並不是獲利能力的重要指標。但如果你問，我們是什麼——我們真正希望在那裡看到什麼？當我們達到 60% 時，我們做得非常好。如果我們開始向 70 邁進，我們需要大力解決這個問題。希望這能帶給你味道。當我們拿出現在安裝的設備時，當我們引進勞動力時，我們當然希望在秋季開始看到更好的勞動力供應。這將幫助我們將利用率提高到 50% 以上，並再次邁向 60% 。

There are no further questions in the queue at this time. I would now like to turn the call back over to Tom.

目前隊列中沒有其他問題。我現在想把電話轉回給湯姆。

Okay. Great. Yes. Thank you, and I wanted to first thank all of you for attending. Hopefully, you understand, and I'll just highlight a few of the factors from the quarter. We delivered revenues and earnings above the high-end of guidance. We did that despite COVID-19 related and supply chain challenges. And our end market diversification, again, really pulled through for us. Solid year-on-year growth of 3% for our ongoing business. And then thirdly, we generated strong and consistent cash flow, a nice demonstration of financial discipline on the part of our team. And finally, I'd just like to thank you again and thank our employees and customers and vendors as well for your continued support. Thank you very much.

好的。偉大的。是的。謝謝大家，我首先要感謝大家的出席。希望您能理解，我將重點介紹本季的一些因素。我們的收入和收益高於指導值的上限。儘管面臨與新冠肺炎 (COVID-19) 相關的挑戰和供應鏈挑戰，我們還是做到了這一點。我們的終端市場多元化再次為我們帶來了真正的成功。我們的持續業務年穩定成長 3%。第三，我們產生了強勁且持續的現金流，這很好地體現了我們團隊的財務紀律。最後，我想再次感謝您，並感謝我們的員工、客戶和供應商以及您的持續支持。非常感謝。

Thank you, ladies and gentlemen. This concludes today's teleconference. You may now disconnect.

謝謝你們，女士們、先生們。今天的電話會議到此結束。您現在可以斷開連線。