UTStarcom Holdings Corp (UTSI) 2019 Q3 法說會逐字稿

Hello, ladies and gentlemen, thank you for standing by for UTStarcom's Third Quarter 2019 Earnings Conference Call. Please note that we are recording today's conference call.

女士們，先生們，您好，感謝您支持 UT斯達康 2019 年第三季度財報電話會議。請注意，我們正在錄製今天的電話會議。

I will now hand over the call to Mr. Gary Dvorchak, Managing Director of The Blueshirt Group Asia. Please go ahead, Mr. Dvorchak.

我現在將電話轉交給 The Blueshirt Group Asia 董事總經理 Gary Dvorchak 先生。請繼續，Dvorchak 先生。

Thank you, Grace. Hello, everyone, and welcome to UTStarcom's Third Quarter 2019 Earnings Conference Call. Earlier today, we distributed our earnings press release. You can find a copy at our website at www.utstar.com. In addition, we've posted a presentation on our website, which you can download and use to follow along with today's call.

謝謝你，格蕾絲。大家好，歡迎來到UT斯達康2019年第三季度財報電話會議。今天早些時候，我們發布了收益新聞稿。您可以在我們的網站 www.utstar.com 上找到副本。此外，我們還在我們的網站上發布了一個演示文稿，您可以下載並使用它來跟進今天的電話會議。

On today's call, we have Mr. Tim Ti, Chief Executive Officer; and Mr. Eric Lam, Vice President of Finance.

在今天的電話會議上，我們有首席執行官 Tim Ti 先生；以及財務部副總裁 Eric Lam 先生。

Before we get started, let me refer you to the company's safe harbor statement on Page 2 of the slides. This call will include forward-looking statements relating to the company's business and strategic initiatives. Those statements are forward-looking in nature and are subject to risks and uncertainties that may cause actual results to differ materially and adversely from the company's current expectations. The risks and uncertainties include factors identified in the company's latest annual report on Form 20-F and the current reports on Form 6-K filed with the Securities and Exchange Commission.

在我們開始之前，讓我向您推薦幻燈片第 2 頁上的公司安全港聲明。此次電話會議將包括與公司業務和戰略計劃相關的前瞻性陳述。這些陳述本質上是前瞻性的，受風險和不確定因素的影響，可能導致實際結果與公司當前的預期產生重大不利差異。風險和不確定性包括公司最新的 20-F 表年度報告和向美國證券交易委員會提交的 6-K 表當前報告中確定的因素。

All forward-looking statements included in this call are based on information available to the company as of the date of this call. That information may change. If so, the company assumes no obligation to update any such forward-looking statements. Also, please note that unless otherwise stated, all figures mentioned during this call are in U.S. dollars.

本次電話會議中包含的所有前瞻性陳述均基於截至本次電話會議之日公司可獲得的信息。該信息可能會改變。如果是這樣，公司不承擔更新任何此類前瞻性陳述的義務。另外請注意，除非另有說明，否則本次電話會議中提到的所有數字均以美元為單位。

I'll now hand the call over to UtStarcom's CEO, Mr. Tim Ti. Tim?

我現在將電話轉交給 UtStarcom 的首席執行官 Tim Ti 先生。蒂姆？

Thank you, Gary, and thank you, everyone, for joining our call today. We appreciate your interest in UTStarcom. As Gary mentioned, you can download the presentation from the Investors section of our website.

謝謝你，加里，感謝大家今天加入我們的電話會議。感謝您對 UT斯達康的關注。正如加里提到的，您可以從我們網站的投資者部分下載演示文稿。

Now let me quickly recap our Q3 results, as shown on Page 3. Third quarter results were mixed. Revenue was in line with our expectation. Gross margin was excellent, expense control was great, but we had an AR reserve charge that resulted in bottom line loss. I do want to point out that the reserve, which is related to our major customer in India, was the prudent accounting measure to apply our accounting policies consistently and conservatively. The customer, BSNL, is 100% state-owned enterprise is having financial difficulty. The India government is implementing a revival plan to restore BSNL to financial health. In light of that, we are confident we will eventually collect, although the timing of the payment is uncertain. As such, we prefer to be prudent and account conservatively for this situation, in accordance with our AR reserve policy. Eric will provide more details in his remarks.

現在讓我快速回顧一下我們第三季度的結果，如第 3 頁所示。第三季度的結果喜憂參半。收入符合我們的預期。毛利率非常好，費用控制也很好，但我們有一個 AR 準備金費用導致底線損失。我確實想指出，與我們在印度的主要客戶有關的準備金是審慎的會計措施，以一致和保守地應用我們的會計政策。客戶 BSNL 是 100% 的國有企業，目前正面臨財務困難。印度政府正在實施一項復興計劃，以使 BSNL 恢復財務健康。有鑑於此，我們有信心最終會收款，儘管付款時間不確定。因此，根據我們的應收賬款儲備政策，我們更願意對這種情況保持謹慎和保守的態度。埃里克將在他的發言中提供更多細節。

Looking at operations, we had some encouraging developments in the quarter. First, I want to highlight the product line we consider the future of UTStarcom, our SkyFlux product line. This product bundles our key technologies that address the needs of 5G. They are Segment Routing, FlexE Ethernet, SDN Controllers and the Synchronization. SDN stands for Software Defined Network, an important technology to improve the flexibility and efficiency of network operations. 5G has been brought out around the globe, but the most aggressive network upgrades are here in China. We are marketing our SkyFlux product through a partner that's competing for massive 5G upgrade here in China. The carrier is doing extensive testing on the equipment they intend to buy next year. Our products had already passed the laboratory and the field test. We are very encouraged by this achievement as it keeps our team on track to compete for market share. We are cautiously optimistic and excited about this early 5G opportunity.

在運營方面，我們在本季度取得了一些令人鼓舞的發展。首先，我想強調一下我們認為 UT 斯達康未來的產品線，我們的 SkyFlux 產品線。該產品捆綁了我們滿足 5G 需求的關鍵技術。它們是分段路由、FlexE 以太網、SDN 控制器和同步。SDN全稱Software Defined Network，是提高網絡運營靈活性和效率的重要技術。5G已經在全球鋪開，但最激進的網絡升級卻在中國。我們正在通過一個在中國競爭大規模 5G 升級的合作夥伴來營銷我們的 SkyFlux 產品。該承運人正在對他們打算明年購買的設備進行廣泛的測試。我們的產品已經通過了實驗室和現場測試。我們對這一成就感到非常鼓舞，因為它使我們的團隊保持在爭奪市場份額的正軌上。我們對這個早期的 5G 機會持謹慎樂觀和興奮的態度。

As you can imagine, an upgrade of the whole network around China is a massive undertaking. Carriers will spend multiple periods over the years. And the winner will capture a very large revenue stream for many years. We have made significant investments in R&D to position the company with the most advanced equipment possible to capture the opportunities in China as well as other markets for years ahead.

可想而知，在中國進行全網升級是一項浩大的工程。多年來，運營商將花費多個時期。獲勝者將在多年內獲得非常龐大的收入來源。我們在研發方面進行了大量投資，以使公司擁有最先進的設備，以便在未來幾年抓住中國和其他市場的機遇。

Let's turn to an important element of our 5G product package, Synchronization. Synchronization is critical function for 5G networks as well as incoming 5G. As we continue our sales and the shipment of SyncRing products for the 5G network, our 5G product version is being refined and we'll be ready to support a 5G rollout. We are optimistic about the contribution, the SyncRing product line can make over time. The market is competitive, but we believe our SyncRing product line is the leading solution to address this important technical requirement. Particularly in the 5G rollout, we believe SyncRing will be of significant value to our customers.

讓我們轉向 5G 產品包的一個重要元素，即同步。同步是 5G 網絡和傳入 5G 的關鍵功能。隨著我們繼續為 5G 網絡銷售和發貨 SyncRing 產品，我們的 5G 產品版本正在完善，我們將準備好支持 5G 推出。我們看好 SyncRing 產品線可以隨著時間做出的貢獻。市場競爭激烈，但我們相信我們的 SyncRing 產品線是滿足這一重要技術要求的領先解決方案。特別是在 5G 推出時，我們相信 SyncRing 將對我們的客戶具有重要價值。

Another operating highlight is our participation at India Mobile Congress 2019, or IMC, in October. Although the BSNL situation is difficult, India remains a huge and important target market for us. The country has just completed the 3G to 4G migration. So it's a bit behind most of the developed countries and (inaudible) will be great market as they try to catch up in 5G deployment.

另一個運營亮點是我們於 10 月參加了 2019 年印度移動大會 (India Mobile Congress 2019)，即 IMC。儘管 BSNL 形勢艱難，但印度對我們來說仍然是一個巨大而重要的目標市場。該國剛剛完成了 3G 到 4G 的遷移。所以它有點落後於大多數發達國家，並且（聽不清）將是一個巨大的市場，因為他們試圖趕上 5G 部署。

We used IMC to further reinforce our presence in this important market. The IMC is India's premier telecommunications and mobile technology conference. This offers a platform for major telecom service providers and the technology leaders to share insights and showcase their latest products and technologies. During the event, we showcased a comprehensive suite of our products, including 5G offering based on next-generation technologies. This includes a slicing-based transport solution, a 5G indoor coverage solution and solutions for end-to-end network synchronization.

我們利用 IMC 進一步加強了我們在這個重要市場的影響力。IMC 是印度首屈一指的電信和移動技術會議。這為主要電信服務提供商和技術領導者提供了一個分享見解和展示他們最新產品和技術的平台。在活動期間，我們展示了我們的全套產品，包括基於下一代技術的 5G 產品。這包括基於切片的傳送解決方案、5G室內覆蓋解決方案和端到端網絡同步解決方案。

Our products can be used in optimized solution for mobile backhaul, metro aggregation, broadband access, network core, Smart Cities and more. During a CEO panel discussion entitled, Imagine the Connected Future, we shared our view on 5G challenges as well as 5G transport network infrastructures. Additionally, we delivered a keynote speech entitled, Evolving roles of OEM in the digital revolution. The keynote highlight is the evolution of the telecom industry ecosystem.

我們的產品可用於移動回傳、城域匯聚、寬帶接入、網絡核心、智慧城市等領域的優化解決方案。在題為“暢想互聯未來”的 CEO 小組討論中，我們分享了我們對 5G 挑戰和 5G 傳輸網絡基礎設施的看法。此外，我們還發表了題為“OEM 在數字革命中不斷演變的角色”的主題演講。主題演講的亮點是電信行業生態系統的演變。

Final highlight in the quarter was development in the Unattended Retail market, which we are addressing with our goSmart solution. We are expanding our effort in Americas and the Taiwan and actively pursuing promising opportunities there. We are targeting the hotel industry with our goCube line to be deployed in self-service hotel lobbies. In addition, we have designated an exclusive agent in Latin America to market our goSmart products at the point of sale locations such as apartments, hotels and other high traffic areas.

本季度的最後一個亮點是無人值守零售市場的發展，我們正在通過我們的 goSmart 解決方案解決這個問題。我們正在擴大我們在美洲和台灣的努力，並積極尋求那裡有希望的機會。我們的目標是酒店業，我們的 goCube 系列將部署在自助酒店大堂。此外，我們在拉丁美洲指定了一家獨家代理商，在公寓、酒店和其他人流量大的區域等銷售點銷售我們的 goSmart 產品。

So let me conclude, then turn it over to Eric. We fully recognize the challenge we face, new upgrades, travel impacts and the financial challenges of key customers. These are all affecting us now. However, this has never been -- we love challenge. And we have some (inaudible) over the years. As we look forward, we see opportunities. The 5G transition will be a massive opportunity for our industry for several years. Our investment in R&D has produced a strong product line that positions us well for the future. We are seeing earlier signs of success and intended to accept the risk, our effort and capture our share of this great opportunity.

那麼讓我總結一下，然後將其交給埃里克。我們充分認識到我們面臨的挑戰、新升級、旅行影響以及主要客戶的財務挑戰。這些都在影響著我們現在。然而，這從來都不是——我們喜歡挑戰。這些年來我們有一些（聽不清）。展望未來，我們看到了機遇。未來幾年，5G 過渡將為我們的行業帶來巨大機遇。我們在研發方面的投資產生了強大的產品線，為我們的未來做好了準備。我們看到了成功的早期跡象，並打算接受風險、我們的努力並抓住我們分享這一巨大機會的份額。

Okay. Now I will turn the call over to Eric for comments on our financial performance. Eric?

好的。現在我將把電話轉給埃里克，請他對我們的財務業績發表評論。埃里克？

Thank you, Tim, and thank you, everyone, for joining the call today. As I review our financial performance, please keep in mind that all figures refer to the third quarter of 2019, unless I say otherwise. Also, all comparisons are with the same period last year, unless I specify differently.

謝謝蒂姆，也謝謝大家今天加入電話會議。在我回顧我們的財務業績時，請記住，所有數據均指 2019 年第三季度，除非我另有說明。此外，除非我另有說明，否則所有比較都是與去年同期進行的。

Turning on Page 11. Revenue was slightly up to $13 million, down 75%, within our guidance range. The comparison is skewed due to a sizable project for BSNL in India last year. In contrast, even though our revenue was down substantially, our gross profit decline was modest, mainly due to favorable product mix and our gross margin was 55%, as shown on Page 12. This was far above last year's 19% gross margin. The product mix included some high margin last-time buy product sales to Taiwan as we exit that market. Our exit is driven by political reasons, not operational. Our Taiwan business was steady and profitable. However, as more Chinese entities invested in our company, our proportion of Chinese shareholders had exceeded a limit established by the Taiwanese government. Consequently, we are no longer permitted to sell telecom equipment there.

打開第 11 頁。在我們的指導範圍內，收入略高於 1300 萬美元，下降了 75%。由於去年印度 BSNL 的一個大型項目，這種比較是有偏差的。相比之下，儘管我們的收入大幅下降，但我們的毛利下降幅度不大，主要是由於有利的產品組合，我們的毛利率為 55%，如第 12 頁所示。這遠高於去年 19% 的毛利率。當我們退出台灣市場時，產品組合包括一些高利潤的最後一次購買產品銷售到台灣。我們的退出是出於政治原因，而不是出於操作原因。我們的台灣業務穩定且盈利。然而，隨著越來越多的中國實體投資我們公司，我們的中國股東比例已經超過了台灣政府規定的限制。因此，我們不再被允許在那裡銷售電信設備。

Now before I go any further, I would like to take the opportunity to elaborate on the status of our long-time and major customer in India, namely BSNL. The BSNL situation not only impacted our expenses due to higher AR reserve, it also disrupted our normal revenue stream. As Tim mentioned, BSNL is 100% state-owned enterprise, characterized as a central public sector enterprise, or CPSE. BSNL has been experiencing financial difficulties, and its future is a subject of debate within the India cabinet ministers.

現在，在我繼續之前，我想藉此機會詳細說明我們在印度的長期和主要客戶 BSNL 的狀況。BSNL 的情況不僅由於較高的 AR 準備金而影響了我們的開支，還擾亂了我們的正常收入來源。正如 Tim 提到的，BSNL 是 100% 國有企業，具有中央公共部門企業或 CPSE 的特徵。BSNL 一直遇到財務困難，它的未來是印度內閣部長們爭論的話題。

Now prior to Prime Minister Modi's reelection, all new capital projects at BSNL were suspended until the election results were known. This impacted our bookings and revenue in 2019. Furthermore, payments to suppliers for capital projects were delayed as BSNL's financial condition deteriorated. Now that the election is over, India's Department of Telecom proposed and the cabinet ministry approved a $10 billion revival plan. The plan included a voluntary retirement scheme to reduce people costs as well as the capital infusion plan to upgrade BSNL's infrastructure to 4G. Additionally, the Department of Telecom authorized government loan guarantees to raise funds for BSNL to clear its outstanding payment to vendors and suppliers. Also recently, the Indian Finance Minister announced support for India's 5-year, $1.4 trillion growth plan, which specifically guarantees suppliers payment for all CPSEs. Obviously, we are concerned about the aging of our receivable from BSNL. However, with the revival plan in place, we are confident that eventually we will collect from BSNL; however, the precise timing is uncertain.

現在，在莫迪總理再次當選之前，BSNL 的所有新資本項目都被暫停，直到選舉結果公佈。這影響了我們 2019 年的預訂量和收入。此外，由於 BSNL 的財務狀況惡化，向供應商支付資本項目的款項被推遲。現在大選結束，印度電信部提出，內閣部批准了100億美元的複興計劃。該計劃包括一項旨在降低人員成本的自願退休計劃，以及將 BSNL 的基礎設施升級至 4G 的注資計劃。此外，電信部授權政府貸款擔保為 BSNL 籌集資金，以清算其對供應商和供應商的未付款項。同樣在最近，印度財政部長宣布支持印度 5 年 1.4 萬億美元的增長計劃，該計劃特別保證供應商支付所有 CPSE。顯然，我們擔心 BSNL 的應收賬款老化。然而，有了復興計劃，我們有信心最終會從 BSNL 收集；但是，確切的時間不確定。

After careful deliberation, the company has decided to provide a $3.6 million AR reserve. Now this is a prudent and consistent application of our accounting policy based on AR aging. Of course, we will monitor BSNL's payment status closely and adjust the AR reserve accordingly.

經過慎重考慮，公司決定提供 360 萬美元的應收賬款儲備金。現在，這是我們基於 AR 老化的會計政策的謹慎和一致的應用。當然，我們會密切關注 BSNL 的支付情況，並相應調整 AR 準備金。

Now back to operating expenses as shown on Page 13. Operating expenses were $9.6 million, up 65%. The increase is solely due to the noncash $3.6 million AR reserve charge that we spoke about earlier. We'll focus our spending on what is important. That is R&D, which was up 29%. The increased R&D spending demonstrates our continued commitment to new products and technology development, which we believe will come into fruition in the near future. Overall, the lower revenue and higher OpEx translated into an operating loss of $2.3 million.

現在回到第 13 頁所示的運營費用。運營費用為 960 萬美元，增長 65%。增加完全是由於我們之前談到的 360 萬美元的非現金 AR 準備金費用。我們將把開支集中在重要的事情上。那就是研發，增長了 29%。研發支出的增加表明我們對新產品和技術開發的持續承諾，我們相信這將在不久的將來取得成果。總體而言，較低的收入和較高的運營支出轉化為 230 萬美元的運營虧損。

Turning to Page 14. Net loss for the quarter was $2.1 million or a loss of $0.06 per share compared to an income of $2.1 million or a gain of $0.06 per share last year.

翻到第 14 頁。本季度淨虧損為 210 萬美元或每股虧損 0.06 美元，而去年同期為收入 210 萬美元或每股收益 0.06 美元。

Page 15 summarizes our cash flow. We ended the quarter with $48 million in cash and equivalents, a decrease of $7 million from last quarter. Net cash used in operations was $9.3 million.

第 15 頁總結了我們的現金流。我們在本季度末擁有 4800 萬美元的現金和等價物，比上一季度減少 700 萬美元。運營中使用的現金淨額為 930 萬美元。

With that, let's turn to our revenue guidance, as shown on Page 16. Now before I discuss the numbers, I'd like to point out several risk factors. First, a major customer in Japan is transitioning to next-generation 5G, which introduces uncertainty into their ordering patterns. We did ship signaling products to them this quarter and will continue next quarter, though we are taking a conservative sense about the amount of revenue we can expect from them in the next few quarters. There are trade war restrictions and political concerns in Japan, all potentially impacting procurement decisions involving China suppliers and even China-based suppliers. This makes us very cautious on our business in Japan. Similarly, we are mindful of the uncertainties surrounding emerging -- sorry, emerging new technology opportunity like 5G, which could be slow to develop and highly competitive. However, we are confident of our new technological capability, let's say, of product offerings. Over time, we do see many growth opportunities in new technology trends, new markets, new products and new applications. All in all, we are excited about our long-term prospects.

有了這個，讓我們轉向我們的收入指導，如第 16 頁所示。在討論這些數字之前，我想指出幾個風險因素。首先，日本的一個主要客戶正在過渡到下一代 5G，這給他們的訂購模式帶來了不確定性。本季度我們確實向他們提供了信號產品，並將在下個季度繼續，儘管我們對未來幾個季度我們可以從他們那裡獲得的收入持保守看法。日本存在貿易戰限制和政治擔憂，所有這些都可能影響涉及中國供應商甚至中國供應商的採購決策。這讓我們對在日本的業務非常謹慎。同樣，我們注意到圍繞新興的不確定性——抱歉，新興的新技術機會，如 5G，可能發展緩慢且競爭激烈。但是，我們對我們的新技術能力充滿信心，比方說，產品供應。隨著時間的推移，我們確實在新技術趨勢、新市場、新產品和新應用中看到了許多增長機會。總而言之，我們對我們的長期前景感到興奮。

Now moving to our specific guidance, we expect fourth quarter 2019 revenue to be in the range of $12 million to $15 million. Please bear in mind that the fourth quarter revenue mix is unlikely to match that of the third quarter and may affect the level of profitability.

現在轉向我們的具體指導，我們預計 2019 年第四季度的收入將在 1200 萬至 1500 萬美元之間。請記住，第四季度的收入組合不太可能與第三季度相匹配，並可能影響盈利水平。

With that, Tim and I would like to take your questions. Operator, please open the line for Q&A.

有了這個，蒂姆和我想回答你的問題。接線員，請打開Q&A線路。

(Operator Instructions) The first question comes from the line of Tim Savageaux from Northland Capital.

（操作員說明） 第一個問題來自 Northland Capital 的 Tim Savageaux。

I have a number of questions. I guess, with regard to the guidance, let's just maybe take it region by region. I can't imagine, well, what are your expectations for the potential of any new business in India? I assume your guidance for Q4 remains dominated by Japan. Eric, you made a comment on mix. Maybe that refers to the Taiwan last-time buy not reoccurring, but would that be accurate with regard to most of your near-term revenue coming from Japan? And beyond that, I guess, if you could be more specific with regard to the risks to that revenue going into next year? Then I'll follow-up on India.

我有很多問題。我想，關於指南，我們可以逐個區域進行。我無法想像，您對印度任何新業務的潛力有何期望？我假設您對第四季度的指導仍然由日本主導。埃里克，你對混音發表了評論。也許這指的是台灣最後一次購買不再發生，但對於您來自日本的大部分近期收入而言，這是否準確？除此之外，我想，你能否更具體地說明明年該收入的風險？然後我會跟進印度。

Tim, for Q4, it looks -- it appears, at this point, the revenue is going to be a very balance from Japan and from India. So that's -- and you're right that we would not have the Taiwan last-time buy benefits in Q4.

蒂姆，對於第四季度，看起來 - 看來，在這一點上，來自日本和印度的收入將非常平衡。這就是 - 你是對的，我們不會在第四季度獲得台灣最後一次購買的好處。

Okay. Well, that's interesting then. Well, can you say with regard to India, so are you engaging in new projects with BSNL? Is this another Indian customer as you can work on receivables?

好的。那麼，那很有趣。好吧，關於印度，您能說說您是否正在與 BSNL 合作開展新項目？這是您可以處理應收賬款的另一位印度客戶嗎？

There really is a continuation of some of the existing projects with BSNL that we are finishing up. We are at the installation and commissioning phase. So as we complete those installations and commissioning those products, then we will recognize mostly the service revenue. So that's what we are counting on for Q4 from India.

我們正在完成的 BSNL 中確實有一些現有項目的延續。我們正處於安裝和調試階段。因此，當我們完成這些安裝和調試這些產品時，我們將主要確認服務收入。這就是我們對印度第四季度的期望。

Got it. Got it. And can you talk to the size of the overall receivable with BSNL? I know you're taking $3.6 million on a reserve, and they have -- are the subject of this multibillion-dollar revival plan. But can you give us the magnitude for the overall exposure?

知道了。知道了。你能和 BSNL 談談整體應收賬款的規模嗎？我知道你準備了 360 萬美元的儲備金，他們已經——是這個數十億美元復興計劃的主題。但是你能告訴我們整體風險的大小嗎？

Well, the receivable has been building up because of -- we -- as we complete the project, which we started last year. So the receivable are probably in the magnitude of over $50 million as of Q3. So now we -- as we mentioned, we were very -- of course, we were concerned about the nonpayment of BSNL because of their financial difficulties and the time it took for the government to decide to, I guess, revive this enterprise. So finally, they have made that decision, and that's very good news for us because as far as we know, there's no reason to believe that we won't get paid. So the question for us is really the timing of the payment. Things are not moving the quickest in India. So -- but then things are already in motion. So we do expect payment very soon. So again, the precise timing is a thing that's always been in question. So that's the reason why we decided to continue our reserve practice and policy and reserve a fair amount based on the aging of our receivables.

好吧，應收賬款一直在增加，因為我們完成了去年開始的項目。因此，截至第三季度，應收賬款可能超過 5000 萬美元。所以現在我們 - 正如我們提到的那樣，我們非常 - 當然，我們擔心 BSNL 的不付款，因為他們的財務困難以及政府決定重振這家企業所花費的時間。所以最後，他們做出了那個決定，這對我們來說是個好消息，因為據我們所知，沒有理由相信我們不會得到報酬。所以我們的問題實際上是付款的時間。印度的發展速度並不是最快的。所以——但是事情已經開始了。所以我們確實希望很快付款。因此，準確的時間再次成為一個一直存在問題的問題。因此，這就是為什麼我們決定繼續我們的準備金做法和政策，並根據應收賬款的賬齡準備公允數額的原因。

Okay, got it. Fair enough. And look, obviously, you've got to express some reservations about Japan over time. And -- well, you can tell me whether post resolution of this receivables issue, whether you expect kind of potential new projects with -- in India, but, Tim, you did describe kind of new product, the trial in China as the future of UTStarcom. And I wonder if you can speak to or give us some estimation of the timing of transitions from a trial to deployment for the 5G trials you're engaged in China.

好，知道了。很公平。很明顯，隨著時間的推移，你必須表達對日本的一些保留意見。而且 - 好吧，你可以告訴我這個應收賬款問題是否得到解決，你是否期望在印度開展一些潛在的新項目，但是，蒂姆，你確實描述了一種新產品，在中國的試驗是未來UT斯達康。我想知道您是否可以與我們談談或給我們一些關於您在中國從事的 5G 試驗從試驗到部署的過渡時間的估計。

Tim, right now we still have one major test we need to pass, okay? So once we pass the test, so the next year, the forecast is significant, okay? I currently cannot disclose the number, but that was -- the size of China. So that will be a major contributor for our revenue in 2020.

蒂姆，現在我們還需要通過一項重大測試，好嗎？所以一旦我們通過了測試，明年的預測就很重要了，好嗎？我目前無法透露具體數字，但那是中國的規模。因此，這將成為我們 2020 年收入的主要貢獻者。

(Operator Instructions) The next question comes from the line of David King from UTStarcom.

（操作員說明）下一個問題來自 UTStarcom 的 David King。

Why would management allow themselves to not be paid by a major customer? This sounds like management incompetence. I've listened to prior management conference calls. I've been a shareholder of this company for some time. This is just another long-winded, bull(expletive), meaningless presentation. The company appears to be systematically gutted. I was just...

為什麼管理層會允許自己不接受主要客戶的付款？這聽起來像是管理無能。我聽過之前的管理層電話會議。我成為這家公司的股東已有一段時間了。這只是另一個長篇大論、公牛（咒罵）、毫無意義的演講。該公司似乎被系統地摧毀了。我只是...

(Operator Instructions) This is the end of the question-and-answer session.

（操作員說明）問答環節到此結束。

Okay. Thank you, operator. We are optimistic about our future. We are confident of our technological direction and our leading-edge product and the service offering. We look forward to updating you on our business progress in a few months. Thank you.

好的。謝謝你，運營商。我們對我們的未來感到樂觀。我們對我們的技術方向以及領先的產品和服務充滿信心。我們期待在幾個月內向您通報我們的業務進展情況。謝謝。

That will conclude today's conference call. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。