Ladies and gentlemen, welcome to the 1st Quarter 2019 Earnings Release Conference Call and Live Webcast. I am Myra, the Chorus Call operator. I would like to remind you that all participants will be in listen only mode and the conference has been recorded. The presentation will be followed by a Q and A session The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Selene Befier, Group Vice President, Investor Relations.
Please go ahead.
Thank you, Mara. Good morning and thank you everyone for joining our first quarter 2019 financial results conference call. OSing the call today is Jean Marc Sherry, ST's President and Chief Executive Officer. Joining Jean Marc on the call are Lorenzo Grandie, President of Finance, Infrastructure And Services And Chief Financial Officer and Marc Ocassis, President of Sales marketing, communications and strategy development. This live webcast and presentation materials can be accessed on Investor Relations website.
A replay will be available shortly after the conclusion of this call. As usual, this call will include forward looking statements that involve risk factors that could cause SPS results to differ materially from management's expectations and plans. We encourage you to review the Safe Harbor statement contained in the press release that was issued with the result this morning. And also in ST's most recent regulatory filings for a full description of these risk factors. Also to ensure all participants have an opportunity to ask questions during the Q And A session, please limit yourself to, if possible, to one question and a brief follow-up I'd now like to turn the call over to Jean Marc.
Thank you, Celine. Good morning, everybody. And thank you for joining results, Q2 guidance and full year 2019 expectations. 1st, on Q1. Our revenues at $2,080,000,000 and our gross margin at 39.4 percent were substantially in line with our expectations amid sustained market dynamics.
We were lower than midpoint on revenues. I will say more on that later and better on gross margin. We maintained a solid level of profitability with an operating margin above 10% and a net income of $178,000,000. 2nd So we are still operating under soft market conditions, but today, we are confirming our plan to return to sequential growth in we see 2nd quarter revenues up about 2.4% on a sequential basis. And we see gross margin at about 38.5 percent at the midpoint.
Regarding the full year 2019, is for revenues to be in the range of about 9.45 to $9,850,000,000. This means that we plan for strong sequential growth in the second half of the year across our industrial Automotive And Personal Electronics end markets. This expected level of growth is taking into account already engaged customer programs and new product introductions It is also assuming improving market conditions in the second half of the year. Indeed, our visibility of the market improved as we progressed through the first quarter. In Industrial And Mass Market, exiting the Chinese New Year, we saw no sign of improvement in Q2 demand.
However, March April point of sales revenues at distributors are showing signs of recovery. This coupled with the financial stimulus programs in China is increasing our confidence level for improved market conditions for the second half of twenty nineteen. Automotive is still growing, although tracking at the softer pace and plan. While confirming our revenue dynamics for sequential growth in Q2 and a stronger second half compared to the first half. Our 2019 plan is lower than what we expected until First, on inventory.
Our goal is to decrease it to a level in line with our current revenue expectations, This is an action already embedded in our Q2 gross margin guidance, which includes significant unsaturation charges. 2nd, to adjust our capital spending, we have moderated our 2019 CapEx plan to a range of $1,100,000,000 to $1,200,000,000 The decrease is essentially impacting short term capacity additions. At the same time, we are protecting our strategic programs that support our future growth. In 2019, we will maintain a solid capital structure. Importantly, as part of the proposed Annual General Meeting Resolution.
Our supervisory board is proposing to shareholders to declare a cash dividend of per common share, payable to shareholders in equal quarterly instalments. Now let's move Net revenues decreased 6.7% year over year as sales of microcontrollers and Memories analog and imaging were lower. On the other hand, we had a strong growth in power Discrete And Automotive, as well as growth in Net revenues decreased 21.6%. Compared to our midpoint target, we were lower by 90 basis points. Mainly due to hedging revenues below expectation in discrete and in traditional automotive products.
As expected, all product groups decreased on a sequential basis. Our gross margin was 39.4 percent, 40 basis points higher than the midpoint of our guidance, mainly due to the lower sales pressure and a better than expected product mix. On a seasonally low quarter, our net operating expenses were $607,000,000, within the range already shared with you in January. And has anticipated that included some catch up of 2018 R and D grants. As a result, we maintained a solid level of profitability as our operating margin was 10.2% net income was $178,000,000 and diluted earnings per share were 0.20 Turning to cash generation.
Our net cash from operating activities was $341,000,000 in the first quarter. Our CapEx in Q1 2019 amounted to $322,000,000. After the cash outflow of $76,000,000 of the acquisition of 55 percent of North sale share capital, free cash flow was negative $67,000,000 in the first quarter. We paid cash dividends totaling $64,000,000 and executed a $61,000,000 share buybacks as part of our ongoing program. Now let's move to our second quarter outlook.
In Q2, we plan to return to a sequential revenue growth. We expect revenues to increase about 2.4% at Jimmy Point, Sequential revenue drivers will include growth in Imaging And Power Discrete. On a year over year basis, Imaging, Automotive And Power Discrete, mainly driven by high voltage Mosfet, sorry and silicon carbide Mosfet, we expect that to grow While general purpose microcontrollers and analog products are expected to be the main detractors leading to a year over year decrease of 6.3 percent at the midpoint for our total orders. Our gross margin guidance is 38.5 percent at the midpoint. This represents a decrease of 90 basis points quarter over quarter and 170 basis points year over year, respectively.
The main reason for the sequential gross margin decline about 80 basis points is related to unsaturation charges, resulting from our actions to align inventory with our 2019 revenue expectations. Net operating expenses to be in the range of $625,000,000 to $635,000,000 in Q2 in a seasonally high quarter for this metric Let me now share with you some important business market and product dynamics we saw during the first quarter, starting with Automotive. In Q1, this part of our business grew high single digit year over year. Late in March, we started to see some backlog adjustment in the traditional part of this business. This was due to the decline in the number of car registrations especially in China.
We believe that this trend is likely to be reversed based also on recent market forecasts. The demand for components supporting car electrification and digitalization ADAS and MCUs, continued and continued to be strong. In car electrification, we had a number of significant design wins during Q1, for various electrical car and charging designs. These include smart charging controllers, smart power products for electrical vehicle applications and the 32 bit safety MCU for an vehicle vehicle battery management system for a major European player. For silicon carbide, We announced the agreement to acquire the Wafer manufacturer North 10 on top of the multiyear supply agreement we clear with already announced.
In Q1, we also started to provide global carmakers with sample of our HESPAC drive modules with silicon carbide embedded. In car digitalization, we continue to benefit from our close cooperation with Intel Mobileye, Google and the program for the high Q5 from a European car maker. We also won a major project in Japan with our 32 bit microcontroller family. Moving now to industrial. First, the ongoing inventory correction in the channel, acknowledging shorter lead time.
This is impacting our Analog portfolio general purpose microcontrollers. However, as I mentioned earlier, our business plan assumes better market condition in the second half. With the March and at this point of sales revenues, at distributors showing signs of free robbery. Again, this coupled with the financial stimulus program in China, is increasing our confidence level for improved market conditions in the second half of twenty nineteen. 2nd, power device demand is still strong with the capacity shortage worldwide, and here we have a good backlog visibility.
As you know, industrial is a key area of focus for ST, where we want to accelerate our growth. Progress was visible during Q1 as we continued to our strong push with new product introductions and key design wins across many applications. For example, we announced the next step in our strategy to build a stronger leadership position in embedding processing solutions for industrial. With the launch of our first STM32 microprocessor, we also extended our already broad STM32 ecosystem for micro Proller with further advanced artificial intelligence features and with USB C support. We launched new sensors for the industrial market, including a device with an embedded Machine Learning core, for machine vibration detection.
We also received a word from global player for India grade motion sensor in asset tracking applications. Finally, Q1 also brought many design wins in power discrete for industrial applications. Let me conclude this product and market review sharing with you some points on personal electronics where we target primarily smartphones, wearables and accessories. With a selected approach. The 2019 global smartphone market is forecast to de slightly and foresees the introduction of 1st 5G devices.
Our strategy is to bring more semiconductor content per device and we will benefit from existing and new programs for smartphones as well for wearable and accessories. During Q1, Our Imaging Sensors business was clearly impacted by the anticipated strong seasonality, but we are progressing well on all our engaged programs with major customers. Imaging products are a key component of our selective approach to personal electronics, together with other sensors, secure solutions, power management and analog products. In the first quarter, we brought in wins for motion and pressure sensors and time of flight products in many flagship smartphones and wearables. We also won a motor driver in the smartphone from a major Chinese customer and other designs for smart power and analog products.
To conclude my remarks. During the first quarter, we executed substantially in line with our expectations and we maintained a solid level of profitability. For the second quarter, we are confirming today our plan to return to sequential revenue growth. For the full year 2019, we plan for strong sequential growth in the second half of the year. Compared with the first half and across our industrial, automotive and personal electronics and markets.
Our revenue expectation is based on clearer visibility It is taking into account engaged customer programs, new product introductions and assuming improving market conditions. We are aligning our production with expected demand and moderating our CapEx based open our plan, we expect to maintain a solid capital structure. Our objective in 2019 is to outperform our served market and deliver sustainable profitability. Thank you for your attention, and we look forward to seeing you at our Capital Market Day in London on May 14, and we are now ready to take your questions.
We will now begin you. Participants The first question is from Alexander Petter from Societe Generale. Please go ahead.
Yes, good morning and thanks for taking my question. Just regarding your reduced CapEx outlook and that compared to your revenue guidance for the full year, So it will appear that this is what you thought at the beginning of the year, we're in the same ballpark, higher revenue broadly flat. And so I'd like to know in which market area and which end market you've seen this reduction that leads you to to moderate some of your CapEx expectations for the year?
Good morning, everybody. I, Lorenzo speaking. I'll take your question. Yes, you're rightly say that in respect to the original expectation, we have some reduction. This reduction in term of revenue for the year has brought some moderate decline review of our capital in which area we see actually lower than expected the rebound, especially in the area of the microcontrollers.
In the area of Analoga in which let's say we were expecting, if you remember, at the beginning, we were saying that we would see the Q1 as of the worst quarter. And then let's say restarting in Q2, some improvement in these products, while in Q2, still we see some difficulties in the area of a microcontroller and analog. So these bring us to believe that actually the overall area for these two lines will be less brilliant that we were expecting at the beginning. On top of that, we have also seen in Q1, some weakening in the market of the traditional automotive. This is one of the reasons as we are shorter in revenues on in respective to our guidance.
Thanks. And just to confirm on Automotive, can you give us your growth rate for all of your automotive end markets in the first quarter year on year?
The growth of automotive in in the first quarter, year over year is above 10% is in the range of 12% to 13% is, so still a significant growth. I would like to remind all of you that I talk about Automotive is not only the group Automotive, but all the sales that the company does in the in automotive. That is encompassing, of course, also power with our silicon carbide, also microcontrollers, memories, all our products.
The next question is from Johannes Schaller from Deutsche Bank. Please go ahead.
In terms of the new design wins and then there's key company specific drivers for the second half, could you maybe give us a bit of an indication how much of the growth they will contribute in H2 and maybe kind of make a bit of a distinction between that and what you assume for the market. I think that would be quite helpful. And then also could you maybe give us an idea just on the underutilization charges in Q1 and what you plan for Q2 and what your fab utilization would be for the 2 quarters? That would be helpful. Thank you.
So I will take the first question and Lorenzo will take the second question. So clearly, at the midpoint of our expectation for the full year 2019, we will grow our revenue in the range of, let's say, $1,250,000,000 US dollar H2 versus H1. I have to say that 65% of these goals will be related to already engaged programs and new product introduction with customers. And around 35% will be related to better market condition both for some OEM and distribution channel.
About the utilization rate, the impact of unsaturation. In Q1, our gross margin aim substantially with no saturation on the front end. If you want, we have around 20 basis points of an efficiency in backend related to the fact that we have some specific line like for instance imaging in which the low level of loading brings some impact in our gross margin. But this was fully embedded in our original, let's say, guidance, the level of 39% for Q1. The overall saturation for the front for the fabs in Q1 was in the range of 88%.
So they were fully loaded. And this wasn't that what we enter in Q1 saying that we would not, let's say, reduce the level of production in Q1 in respect to fully loaded fab. Then in Q2, of course, we started to have some correction in term of loading due to the fact that we wanted to keep under our inventory that has increased, as you have seen, during the course of Q1. So the level of saturation our fab will be more in the range of 83%. And as we said, this is impacting around 80 basis points with the unloading charges, the gross margin of Q2.
Perfect. That's very helpful. And then for the second half of the year, we should assume these unloading charges to go away, I would assume.
Well, for the 2nd part of the year, we do expect still to have a unloading charges. They will not go away immediately because the level of revenue that we do expect is significantly increasing, but or notwithstanding this, we think that at least in Q3, we will still have unloading charges. Then in Q4, for sure, they will be much lesser than it would be in Q3 and in the second quarter, but we do expect that to have some unloading charges also in the second part of the year.
Understood. That's very clear. Thank you.
The next question is from David Mulholland from UBS. Please go ahead.
Hi, thanks very much. Just wanted to ask on the inventory level that you've got to the end of Q1, if I calculated it right, it's about 128 days. I just wanted to ask how you feel about that. Can you give us some color on the exact areas that you've built inventory up through the quarter? And given the you just made on what the utilization rate will be in Q2?
Should we still be expecting inventory levels to be increasing through Q2? Or can you start to see that trend coverage in absolute terms?
Thank you for your question. About inventory, you're right. Inventory in Q1 increase increased significantly. This was embedded in our numbers. Of course, increased a little bit more than expected due to the fact that our revenue came a little bit shorter in respect to our midpoint.
In the what will happen in the second in the second quarter. In the second quarter, we do expect that the number of days of inventory will remain substantially flat. This means that will be significant reduction of inventory during the second quarter. We will start to see reduction both in number of days significant reduction in number of days and in absolute value during the second half of the year. We do expect that to end the year substantially in with a number of days similar to the one in which we entering in 2019, what it was in Q4 20 So in the range of the end of 90 days or something like that.
The next question is from Achal Sustania from Credit Suisse. Please go ahead.
Hi, good morning, everyone. Just coming back to the the point that you're making on versus one of your peer groups in Germany. Obviously, your peer group is talking about low single digit quarter on quarter growth in June September quarters. You were talking about 2.4 in June and then probably somewhere between 15 to 20 in Q3. Can you just help us understand like what are these new product wins that is giving you this visibility going into the second half?
Can you give us some more color which product areas, which customers? Any color on that would be helpful. Thank you.
I bought the second half, for, engaged programs and new products. Clearly, the main contributors are product related to Automotive And Personal Electronics end markets. And as you know, on automotive, it is clearly related to electrification of the car and digitalization of the car. On personal electronics, it is a blend of our selected approach on sensors, of course, imaging sensors, secure solution, but analog product as well. On the other side, for market condition, obviously it is more related to industrial and mass market and the product involved are more general purpose, analog and microcontrollers.
And how should we think about the the margin profile of these new design wins, is it going to be similar to the group average, or a bit different?
This, okay, we do not comment the gross margin of our new programs and product.
Okay. Thank you, John.
The next question is from Stefan Houri from ODDO. Please go ahead.
Yes, good morning. Question on the second half again. If we look at what you're guiding, basically it's probably above 25% of sequential growth, H2 versus H1. And when you look at it, sorry, really never happened before unless in very good market years. And you've just commented that twothree of the growth was coming.
From engagement from your customers and your products. So where do you think your growth should be at the end of the year, if the recovery does not really happen? And what will be the impact on the gross margin going forward? Thank you.
So thank you for your question. I would simply say that the range of revenue, we share today with you from a 9.45to9.85 are already embedding risk and opportunities more than that today, I would not comment. So we can't comment gross margin within this range. And maybe Lorenzo, you can give some color, but I cannot comment, okay, part of this launch because we do believe today, with, again, a better or clearer visibility entering in the year in January or in December with a clear visibility. We do believe that this range of revenue already umberging the risk and opportunities.
Okay. About the gross margin, let's say, we have a diesel engine today, our plan is moving between these two 9.45,9.85. Of course, gross margin, it depends on the level of the growth that we will be able to post in the second half also because there will be, as I set some level of unsaturation. Of course, I will be glad that during, 3 weeks from now, during the Capital Market Day to let's say drive you a little bit more in detail on the dynamics that we see. What I can say is that if we are a substantially at midpoint of this range, we see something in terms of gross margin slightly above 38%.
Here we would fall in the low end of the revenue range. Most likely we see some thing that is closer to slightly above 37%. Okay. Okay. On the eyes side, let's say for sure, there will be something that is better than this 38% plus.
And we will get back closer to 39%. Then as I said, we will
have the chance 3 weeks from now to go a little bit more
in detail of the dynamics
about this important parameter.
Okay. And sorry, just to follow-up about the OpEx because it seems that the range is higher than you previously guided. Is it the new guidance, the 625% to635
No, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no,
no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no 30 is this valid. It means that the full year, let's say, if you take the our expense school year and you divide it by 4, you will find that something that will be in this range. Between 620,000,000 dollars, $630,000,000. So it is in the range. Of course, Q1 came at much lower there could be for seasonality, a little bit higher.
Q3 will be a little bit lower and Q4 will be. So at the end, at the end, the 4Q2 is true is a little bit higher than the average. But on the average of the year by quarter, it will be between 62630. I don't know if if it's clear what I try to say.
The next question is from Anthony Stoss from Craig Hallum. Please go ahead.
Good morning, gentlemen. Maybe just to put a finer point on your second half growth. Can you share if you expect your content with your largest smartphone customer to be up substantially kind of generation over generation in this fall's phone. And then also if you wouldn't mind commenting about the number of expected silicon and carbide customers by the end of 2019 and maybe how you see ramping over the next few years? Thank you.
So, as I told you in my previous speech, yes, We'll increase our semiconductor and value content with our major customer. Addressing the smartphone market. So I confirm it to you. Then about silicon carbide. So our revenue target for 2019 is to be about $200,000,000.
So two double the revenue, addressing MOSFET, but also in a certain extent diodes, mainly this revenue will come from our engagement with our main customers but important to say again and to share with you that we are already engaged with 30 important programs with various customers across the various regions in the world to address both electrification of the car and industrial end market. But clearly, in 2019, the main part of our revenue will be linked to our already engaged main customer Ment Gustamil.
Thank you. And as a follow-up, Sean, can you, you already talked about seeing signs of recovery Is there a particular region that you haven't seen a recovery yet?
Well, it is clear that from a region point of view, Europe is, in term of trend is a weaker operation.
Great. Thank you.
The next question is from Jerome Rommel from Exane BNP Paribas. Please go ahead.
Yes. Good morning. Two questions. The first one, what is the outsourcing level and how should we model it going forward to understand how to reconcile the comments you made on the gross margin going forward and the utilization? If we look at the, when you yes.
Sorry, the question is over or I can answer, let's say, I will ask you about the outsourcing. And then if you have a follow on for question, we can listen About the outsourcing in Q1, the outsourcing was in term of front end outsourcing that what is the most important for us. In value of production was in the range of 17%. 17% of our value of production was coming foundry in Q1. What will happen going forward?
There will be 2, let's say, 2 fold. One side that we have some repatriation that will be finalized and not very significant, but still we have some flexibility On the other side, some of the programs that will fool the growth in the second part of the year will be, let's say, from foundry. So that means that at the end, the level of the percentage of what we are sourcing in front end in term of value production, we remain substantially flat in the course of the year at this level.
Okay. Thank you. And just a quick follow-up for Jean Marc. If I look at your guidance for the full year, you will exceed the full year with a substantial higher level of revenues compared to, even compared to Q4 last year. So the question for investors will be, how sustainable are all these new designs you've signed and you're going to ramp up in the second half of this year going forward?
How sustainable is the level of the design in the Q4 will be the sustainability of our design.
The designers are sustainable and Tiki, okay, as far as it concerned on gauge current engaged programs, new product, but of course, okay, you know that all this product have a lifetime as any semiconductor device but today, okay, this product and this program are sustainable. Of course, okay, again, for next year, okay, you will have a seasonality in the year as we are facing this year. And as we faced, okay, during the past year, but the sustainability of our programs today are not questionable.
So to be clear, are we talking about multi year program or how should we understand the sustainability of this new product and new programs?
I guess for the first time, okay, we gave a full year expectation in April, okay, maybe next year, I would give a 3 year let's say visibility, okay. We have a roadmap. We have a product roadmap. We have a technology roadmap. And I do believe that, okay, this product and technology, roadmap are well matching with the specifications and roadmap of our customers.
But as you know, okay, semiconductor is a competitive market. And for us, there is no other way to be the best in the market we address. That's the reason why on a smartphones wearable and accessories, we are very selective because we want to offer the best product and the best technology. Which is the best driver to be sticky and sustainable.
The next question is from Matt Ramsay from Cowen. Please go ahead, sir.
I guess it sounded like, analog and MCUs were a little bit more longer through the first half of the year than you guys had potentially thought about that thought of the year. Maybe you could talk a little bit about the reasons why you think that might be, not surprising given maybe a little bit more tone out of TI last night as well. But, and then the second part of the question is, do you feel like you now started shipping to and sell through levels and there should be some inventory build in the back half of the year as the distributors or are we still waiting to see signs of that?
You're going to have to take?
I take only the first question. Again, for the first question, what we have a we have seen in Q1 and the reason why we said the visibility is more clear is that we have seen no sign of, let's say, a short term demand increase for Q2 for mass market and industrial market. And of course, impacting the capability to grow our analog product and microcontroller. And I have to say this view is well shared, among our peers. Okay.
That occasion short term demand is, is basically flat. However, as I already explained in some previous call, in order to understand the market dynamic, especially when you are facing a soft market condition as of today. We short backlog visibility, but basically the short backlog visibility is not alarming our self more than that. It's simply the translation of short lead time. So when the industry is offering shortly time, customer offer short backlog visibility.
What is important for us is to monitor the point of sale revenues of our distribution channel. And as I told in Q3 and Q4 last year, when we have seen the first sign of POS decreasing and the first sign of inventory correction and as an impact, revenue decrease for ST, Now in March and in April, we are seeing the first positive sign in POS. It is not yet translating in shore term better demand for ST. Why? Because there is still some inventory correction and still people are cautious on inventory level in the distribution channel.
But what is very positive is that March April has shown positive trend in POS. This is making us comfortable, coupled with the fact that the incentive provided by Chinese authorities about taxes have not been taking into consideration in Q1. People wait to see what is the materiality of this incentive. So with this incentive on taxis by shiny authorities, We do believe that the dynamic of the market on top of what we have already shown in Q1 met us in a good position to expect better market condition in the second half. Then as I told, okay, to as following your question from one colleagues, now in our revenue range, we have taken account opportunities and risk linked to what we call better market conditions.
But we do believe that we have a really good confidence level in this range of revenues 2 third link to programs, 1 third link to better market condition, both for our distribution channel and some other OEM than those which we engage on specific programs.
This is Marco speaking and for the second part of your question, of course, we are expecting that by the end of the year, the level of inventory at distributor will be lower than what we have now, but more important than that, thanks to the lower level inventory, we expect this to be translated in more demand to support the increase of POS by end of the year.
Got it. That additional detail is really helpful. Thank you very much.
This last question is from Gunther Holfelder from Robeco Sam. Please go ahead.
Yeah, many thanks. Just on your automotive business, you mentioned that Silicon Carbide growth this year is mainly driven by your largest customer. I assume that your, the exclusive supplier for the silicon carbide MOSFET and We also, I think there were some indications recently that this technology is also now being used in other models or previous models of your largest customer? Is your growth, let's say, in the second half also including that you are penetrating these other models at your largest customers with your technology?
The $200,000,000 goal, which is part of the full year 2019 revenue range share with you today is encompassing as a full customer demand.
Maybe a second one, if you allow, I mean, right now, there's a lot of discussions in Europe also regarding B2X using CB2X Technology or the, Wi Fi based V2X. And, I remember in the past you had some agreements, foundry agreements with Autotalks. Could you update us on this situation here and what's your road map and also let's, let's say, outlook for, related sales.
Marco speaking. As you correctly said, we have an ongoing collaboration auto talks. And we are very happy about how the collaboration is ongoing. And of course, having deployment around the world of V2X standards, let's say, we are well positioned to leverage on what will happen in the market. But again, and it is clearly a widening and increasing.
But if your question
is a before it was about the Wi Fi, yes, only But now it's covering both Wi Fi and 4g5G connectivity.
Yes. Yes. And you're mainly engaged with order talks on the Wi Fi side, or
On both now.
On both sides. Okay. Good. Many thanks.
Okay. If there's no is there any further question or?
There are no more questions.
So I think with this, This will conclude our, our, call for, for today. Jean Marc, do you want to
No, again, we will, very pleased, okay, to receive you in London on the next May 14th. Clearly, we would really pleased to discuss with you our plan or we want to improve our leadership in the market we address or we want to accelerate in industrial. All we want to improve our leadership in embedded processing solution for industrial or we want to take advantage of our selective approach in the smartphone wearable and accessories. I think it would be a great opportunity for all of us, to share the ambition of ST again to outperform the market and being a sustainable, a profitable company, growing better than the market we sell. So looking forward to see you in London.
I wish you a good day.
Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call and thank you for participating in the conference. You may now disconnect your lines. Goodbye.