Ladies and gentlemen, thank you for standing by, and welcome to Hua Hong Semiconductor second quarter 2021 earnings conference call. Today's call is hosted by Mr. Junjun Tang, President and Executive Director, and Mr. Daniel Wang, Executive Vice President and Chief Financial Officer. Please be advised that your dial-ins are in listen-only mode. However, at the conclusion of the management presentation, there will be a question and answer session, at which time you will receive instructions on how to participate. The earnings press release and second quarter 2021 summary slides are available to download at our company's website, www.huahonggrace.com. Without further ado, I would like to introduce you to Mr. Daniel Wang, Executive Vice President and Chief Financial Officer. Thank you.
Good afternoon, everyone, and thank you all for joining our second quarter 2021 earnings conference. Today we will first have Mr. Junjun Tang, our Executive Director and President, make some remarks on our second quarter performance. President Tang will address in Chinese, and Kathy Chien, our Deputy Director of Investor Relations, will be the translator. After that, I will discuss our financial results and provide guidance for the next quarter. This will be followed by our question-and-answer session. I will now turn the call over to Mr. Tang.
[Non-English content]
Good afternoon, everyone. Thank you for joining our earnings call.
[Non-English content]
The second quarter of 2021 was another record-breaking quarter for Hua Hong Semiconductor, with an unprecedented quarterly revenue of $346.1 million, an increase of 53.6% year-on-year and 13.5% quarter-on-quarter. Both sales volume and unit prices improved significantly, benefiting from growing demand on the domestic market. Market demand for MCU, RF, PMIC, NOR and super-junction is maintaining its strong momentum, which provides a solid foundation for our stable growth. In the second quarter, the combined gross margin of the company's 8-inch business and 12-inch business was 24.8%, a year-on-year decrease of 1.2 percentage points, mainly due to the increase in 12-inch sales revenue share and accompanying substantial depreciation. The gross margin increased by 1.1% from the previous quarter due to the increase in unit prices and a record high in capacity utilization.
The company's shipments surged in the second quarter, and its profitability also increased significantly with a net profit of $37.2 million, a year-on-year increase of 2,848.3%, and a quarter-on-quarter increase of 37.7%. This was the best quarter ever for the three 8-inch fabs. Revenue reached a record high of $262 million. Gross margin increased to 31.6% from 27.3% in Q1 2021 due to improved pricing and operating efficiency. Net profit was $51.3 million, representing 19.6% of total revenue. The three 8-inch fabs continue to be a lucrative business. We will continue finding opportunities to extend our advantages and generate higher profits.
[Non-English content]
Hua Hong Wuxi's 12-inch fab's revenue in the second quarter reached $84.1 million, an increase of 786.8% year-on-year, and an increase of 54% from the previous quarter. EBITDA was $29.9 million, an increase of 208.3% compared to the prior quarter. Our advanced specialty technology has demonstrated its strong market vitality. The smooth and swift rollout of platforms such as embedded flash memory, analog and power devices, and the efficient introduction of customers' products have boosted the growth of capacity. The product mix is reasonable and in line with the market demand.
[Non-English content]
As of May 2021, the monthly capacity of the 12-inch line reached 48,000 wafers and was fully utilized. We will foster closer cooperation with vendors to secure every step of the ramp-up plan and steadily achieve a monthly capacity of 65,000 wafers by the end of this year. We will continue to invest in manufacturing capacity and optimize technology roadmap planning to meet the strong demand and thrive together with the industrial supply chain.
[Non-English content]
With the continuous optimization of the three 8-inch fabs in Shanghai and the rapid expansion of the 12-inch fab in Wuxi, Hua Hong Semiconductor has entered a new development stage with stability and quality. The company, as a vital link in the supply chain, will continue to unswervingly implement and advance our specialty IC+ power discrete strategy. Both 8-inch and 12-inch fabs will support R&D and innovation at the best, fastest, and most stable expansion pace, provide customers with comprehensive and high-quality technical services, and assist in alleviating the global chip shortage.
[Non-English content]
I would like to hand the call over to our CFO, Mr. Daniel Wang, for his comments.
Thank you, Mr. Tang, for the inspiring comments. Let me begin with the summary of our financial performance for the second quarter, followed by an outlook on revenue and the margin for the third quarter. Then we will move on to the question and answer session. First, let me summarize financial performance as of the second quarter. Revenue reached at an all-time high of $346.1 million, 53.6% over the prior year and 13.5% above the prior quarter. Cost of sales was $260.4 million, 56.1% above Q2 2020, and 11.9% over Q1 2021, mainly due to increased wafer shipments and depreciation costs. Gross margin was 24.8%, 1.2 percentage points lower than Q2 2020, primarily due to increased depreciation costs, partially offset by improved average selling price and capacity utilization, and 1.1 percentage points above Q1 2021, primarily driven by improved average selling price and capacity utilization.
Operating expenses were $45.9 million, 26.6% below Q2 2020, and at 22.9% below Q1 2021, mainly due to increased government grants for research and development. Other income net was $11.9 million, flat compared to Q2 2020. It was 67.1% above Q1 2021, primarily due to a foreign exchange gain versus a foreign exchange loss in the prior period. Income tax expense was $14.5 million, compared to $6.7 million in Q2 2020, primarily due to increased taxable profit, and compare up to an income tax credit of $1.1 million in Q1 2021, mainly due to a reversal of the dividend withholding tax in the prior period. Profit for the period was $37.2 million, versus $1.3 million in Q2 2020, and $20.9 million in Q1 2021. Net profit attributable to shareholders of the parent company was $44.1 million, compared to $17.8 million in Q2 2020, and $33.1 million in Q1 2021.
Basic earnings per share was $0.034 versus $0.014 in Q2 2020, and $0.025 in Q1 2021. Annualized ROE was 6.8%, 3.6 percentage points over Q2 2020, and 1.6 percentage points above Q1 2021. I will discuss the operating results for both the Hua Hong 8-inch wafer fabs and the Hua Hong Wuxi 12-inch fab. First, let's have a look at the Hua Hong 8-inch wafer fabs. Revenue reached a record high of $262 million, 21.4% over Q2 2020, and 4.7% above Q1 2021. Gross margin was 31.6%, 3.9 percentage points over Q2 2020, and 4.3 percentage points above Q1 2021, primarily driven by improved average selling price and capacity utilization. Operating expenses were $20.8 million, 20.9% below Q2 2020, and 35.9% below Q1 2021, primarily due to allocation of costs to Hua Hong Wuxi.
Profit before tax was $65.8 million, 57.3% over Q2 2020, and 47.6% over Q1 2021. Let's have a look at the performance of the Hua Hong Wuxi wafer fab. Revenue was $84.1 million, versus $9.5 million in Q2 2020, and $54.6 million in Q1 2021. Operating expenses were $25.1 million, 30.7% lower than Q2 2020, and 7.1% lower than Q1 2021, mainly due to increased government grants for research and development, partially offset by increased service expense. EBITDA was $29.9 million, compared to -$18.5 million in Q2 2020, and $9.7 million in Q1 2021. I provide more details on our revenue from Q2 2021. From a geographical perspective, revenue from China was $255.2 million, contributing 73.8% of total revenue, and an increase of 85.5% over Q2 2020, mainly driven by increased demand for nearly all platforms.
Revenue from Asia was $38.5 million, an increase of 34.9% over Q2 2020, mainly driven by increased demand for MCU and logic products. Revenue from the U.S. was $29.5 million, a decrease of 12.5% over Q2 2020, chiefly due to decreased shipments for MCU products. Revenue from Europe was $16.3 million, a decrease of 14.5% compared to Q2 2020, mainly due to decreased shipments for smart car ICs. Revenue from Japan was $6.5 million, flat compared to Q2 2020. With respect to technology platforms, revenue from embedded non-volatile memory was $103.6 million, an increase of 34.7% over Q2 2020, mainly driven by increased demand for MCU products. Revenue from a standalone non-volatile memory was $18.3 million, an increase of nearly five times over Q2 2020, primarily driven by increased demand for NOR Flash products.
Revenue from discrete was $119.8 million, an increase of 38% over Q2 2020, mainly driven by increased demand for general MOSFET, super-junction, and IGBT products. Revenue from logic and RF was $57 million, an increase of 113.4% over Q2 2020, largely driven by increased demand for CIS and logic products. Revenue from analog and power management IC was $46.9 million, an increase of 48.8% over Q2 2020, mainly driven by increased demand for other power management IC products. Let's now take a look at the cash flow statement. Net cash flows generated from operating activities was $99.1 million, 2.7% lower than Q2 2020, primarily due to increased payments for materials, payroll payables, and decreased receipts of VAT refunds, largely offset by increased receipts from customers as a result of improved customer credit management.
Capital expenditures were $136.5 million in Q2 2021, including $119.1 million for the Wuxi fab and $17.4 million for the Hua Hong 8-inch fabs. Other cash flow generated from investing activities was $1.8 million in Q2 2021. Net cash flows generated from financing activities was $40.6 million, including $47.6 million proceeds from bank borrowings and $0.1 million proceeds from share option exercises, partially offset by $4 million of interest expenses for bank borrowings, $2.3 million of repayment of bank borrowings, and $0.8 million of lease payments. Now let's move to the balance sheet. Cash and cash equivalents was $974.5 million on June 30th, 2021, compared to $961.5 million on March 31st, 2021. Inventories increased from $283.8 million on March 31st, 2021 to $355.9 million on June 30th, 2021, primarily due to increased customers' demand.
Other current asset increased from $142.5 million on March 31st, 2021 to $175.6 million on June 30th, 2021, primarily due to increased VAT refund receivables. Property, plant, and equipment was $2,710 million on June 30th, 2021 compared to $2,498.5 million on March 31st, 2021. Total assets increased from $4,682.4 million on March 31st, 2021 to $4,991 million on June 30th, 2021. Our total bank borrowings increased to $754.9 million on June 30th, 2021 from $709.2 million on March 31st, 2021. Total liabilities increased to $1,539.4 million on June 30th, 2021 from $1,326.9 million on March 31st, 2021, primarily due to increased payables for capital expenditures and bank borrowings. Debt ratio increased to 30.8% on June 30th, 2021 from 28.3% on March 31st, 2021. Finally, let me give you a high-level outlook for the third quarter 2021.
We expect revenue to be approximately $410 million, and our gross margin to be between 25% and 27%. This concludes my financial remarks. We would like to start the question and answer session. Operator, please assist. Thank you.
As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, please press the pound or hash key. Please stand by while we compile the Q&A roster. The first question comes from the line of Leping Huang from Huatai Securities. Please ask a question.
Okay. Thank you for taking my question.
Leping, thank you very much for your very wonderful question. I think that it's very clear, Wuxi is ramping up very fast. Most of the growth is coming from Wuxi. I think at the same time, we're going to see ASP improvement as well for both Hua Hong Wuxi and as well the three 8-inch fabs. Okay? I'm not going to be commenting on the ASP specifically, but we expect the ASP will continue to improve. I think our gross margin for the three 8-inch fabs will continue to improve over time. I think you're going to see, as I said before, every quarter we're going to have 3%-5% ASP improvement for both 8-inch and 12-inch fabs. This is very important because this will give us hopefully more than 10% growth on ASP over the year, and the volume will continue to increase.
As for the volume for the 8-inch fabs, I think we will continue to be able to drive more efficiency throughout the three 8-inch fabs. I think the 3-inch fabs will continue to be able to give us more volume over time because of manufacturing efficiency. Thank you.
Okay. Let me ask the second question. The second question is about your mix in the Wuxi fab. Since Wuxi has grown very quickly, what's the current, if possible, share about what's the mix between the power and the logic? And I think you have 40,000 wafer now, and given the very strong demand currently in these mature 12-inch fabs. When you explain to the end of this year and when you plan the new capacity for the next year, what will be the new process or what will be the major products you are bringing to the Wuxi fab?
[Non-English content]
Thanks for your question. Thanks for all the partners' contribution. We have a very fast construction speed, and based on our more than 20 years process experience, we have a very fast R&D process.
We established our technology platforms maybe through one and a half years.
[Non-English content]
As of May, we have completed the construction target as of 48,000 monthly capacity. We first start 48,000 wafers in June, and the product mix is 18,000 power and 30,000 IC. Given the strong market demand, we start the phase one capacity expansion in the end of 2020. We will expand from 48K - 65K. Among the 55K, we keep the power discrete as 18,000 and expand the IC capacity to 47,000. We still have some space in the clean room.
We are still actively planning for further capacity expansion.
[Non-English content]
In IC products, mainly CIS, NOR Flash, and our own embedded eFlash.
[Non-English content].
There will mainly be super-junction IGBT and SGT for the power discrete.
[Non-English content].
Customers require more capacity in both IC and power discrete, and it's a very solid foundation for our next step capacity expansion
[Non-English content]
Along with all the applications, we have a very strong and solid product based off the capacity utilization improvement.
[Non-English content]
Thank you.
[Non-English content] so when you expand the capacity next year，[Non-English content]
[Non-English content]
We will achieve 65K capacity by the end of this year. Year-on-year basis, we will have double-digit growth in the first half next year. For the further expansion, the main point will be the tool delivery. If the tool delivery can be faster, our pace of capacity expansion can be also faster.
[Non-English content]
By the end of the year, the wafer starts every month will be above 60K per month.
[Non-English content]
Thank you.
Thank you. [Foreign language]
Thank you. The next question comes from the line of Wu Liu Yen from Everbright Securities. Please ask your question.
[Non-English content]
[Non-English content]
The average wafer start for the third quarter will be 50k- 52k per month. In December, the wafer start will be around 60k.
[Non-English content]
The major capacity expansion will be IC and for 55 nm and a little 90 nm.
[Non-English content]
[Foreign language] Overall our CapEx expenditures for the 3-inch fab will be around $140 million for the year. The first half we spend about $40+ million. I expect we in the second half will probably be spend another $95 million. As far as the Wuxi, the 12-inch fab, we have spent about close to $260 million in the first half. This thing, the speed will actually get picked up. I think, for the second half, we're looking at about $1 billion, because we have to start pay for the equipment that were secured for the first phase, and also the money, the capital expenditure we have to pay for the second phase, which is go from a 40,000 wafer capacity to about 65,000 wafer capacity. In total, I think, the 12-inch fab will be around $1.3 billion. The 8-inch fabs will be around $140 million.
[Non-English content]
Thank you. The next question comes from the line of Randy Abrams from Credit Suisse. Please ask your question.
Okay. Yeah, thank you, and good result. I wanted to ask a follow-up on the pricing. Daniel, where you mentioned the 3%-5% per quarter, were you referring, is that for second half, where you expect 3%-5%? Curious for 2022, if you've contracted out pricing and also if you're considering any long-term agreement with your customers to lock in pricing further out.
Thank you, Randy. It was pretty clear if you look at our past Q1 and the Q2, I think we have a pretty steady growth on ASP. Okay. I always said, I said many times before that what you're going to see on quarterly basis, every quarter, you're going to see hopefully 3%-5% growth on ASP. I think we have done that. We're hoping that we can continue to do that in the next two quarters throughout the second half. I'm very confident, this year we're going to be able to, in terms of pricing, I think that overall we should do pretty well, for both 8-inch and 12-inch.
Okay. Have you started, is it too early to talk about 2022, if you still see that direction you're locking in? Maybe the other question is for the gross margin where it's showing improvement in guidance. Do you think the direction, also factoring depreciation coming in, you expect gross margin looks like it's on the track to continue expanding, or how do you see that trending?
I think the gross margin, well, as you look at our guidance, I think our guidance show we're pretty confident we're going to be doing better with gross margin. I think we're going to see a very stable growth, in the 8-inch space, I think the gross margin will continue to grow for the 8-inch fabs. As far as for the 12-inch fab, I think we're going to keep the margin. I think the gross margin will be very stable. I think they will, at certain point, once you reach the scale, I think you're going to see a quick sort of pickup on gross margin for the 12-inch fab as well. In general, I think the gross margin will definitely be positive.
Now it is in single digit, I think once we're at a certain scale, I think the margin should improve very quickly for the 12-inch fab.
Okay. For the OpEx, could you talk about that? In the decline sequentially, how much was the subsidy? Was there a depreciation shift into COGS? How much were those? From here, what's the way to think about how much the right run rate for OpEx?
I think for this year, for the 3-inch fabs, the operating expense should be very stable. This year, it'd be around, just overall, I think, for the 8-inch fab will be around $140 million. This includes the government grants. Okay? For the 12-inch fab, it is also around $140 million. Okay? That's the OpEx.
Okay. Should it go back to about $70, because there's only $46 million. It should go back up toward about $70 million a quarter total, or would there be grants or offset?
The quarterly OpEx, is what you're saying?
Yeah. No, it just seems like the quarterly OpEx is running below that now. It would come back up.
Well, I think for the 3-inch fab should be pretty much in that range. It will be somewhere around $30 million- $40 million each quarter. Okay? That is pretty big number already. Throughout the year, it will be about $140 this year. I think next year, I would expect around $120 million. The OpEx for the Hua Hong Wuxi fab, it will be $140 this year. That is a ballpark number. I think next year it may go up because, some additional R&D activities.
Okay. The last question, just on the expansion. It has been aggressive to go to 65. Are there two steps beyond that to go to 80K, if you have the timing? Beyond that, would you have another site within Wuxi or another location? It seems like by next year, you will need to start planning if you are expanding beyond next year.
Yeah. Good question. 65K is something we will try to achieve by end of this year. We will get to 65K. Equipment for 65K will be installed, be tested by end of this year, so we can definitely have 65K to work on for next year. We still have some space there. I think the plan is to go from 65K, then to 90K- 95K. That is the plan we are looking at, as Mr. Tang earlier has talked about. This is something we try to do in the next phase. You know that we have a big piece of land there, we can potentially build in total three similar fabs there in Wuxi. If the demand continues, sure, we will have plan to build additional fabs.
Great. Thanks a lot, Daniel.
Thank you.
Thank you. The next question comes from the line of Andrew Lu from Sino Link Securities. Please ask your question.
[Non-English content]
Andrew, [Foreign language]. OK. Basically [Foreign language], for the income tax, it is around 15%, OK, 15% income tax, corporate income tax, [Foreign language]. OK. The reason we had a credit is it was because we also do withholding, each year we try to accrue some dividend. Last year we accrue 30% after the income tax of the net income. With that, we assume 10% withholding tax. It turned out to be that the board basically decided not to issue a dividend last year, so we had to reverse that. The credit was virtually coming from the reversal of the withholding tax, 10%, that happened in Q1.
[Non-English content]
[Non-English content]，for income tax，[Non-English content]
OK.
On top of that, you assume 30% dividend. [Non-English content]
[Non-English content]
Andrew，[Non-English content] depreciation expense will become very, very stable. I will not be surprised if the shortage will be easy to get into between 10% - 20%，10%- 20% gross margin [Non-English content]，gross margin [Non-English content]，gross margin is driven by ASP [Non-English content]at some point is going to be reached the peak，[Non-English content] 55 nm technology products[Non-English content] some point，[Non-English content]，40 nm [Non-English content] 55 nm technology[Non-English content]so gross margin, it's just going to be next thing.
This is not something you need to focus right now. Right now it should be cash flow, it should be revenue growth. [Foreign language]
[Non-English content]
Andrew, [Non-English content]
8
[Non-English content]
[Non-English content]
Right.
[Non-English content]
[Non-English content]
[Non-English content]
Right.
[Non-English content]
[Non-English content]
Daniel，[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
Thank you. The next question comes from the line of Sze Ho Ng from China Renaissance. Please ask your question.
Hi, good day, gentlemen, very nice result. I have a few questions on the 12-inch operations. The first one, when we get to the 90,000-95,000 thousand wafer per month capacity milestone. Will the company immediately start more expansion or we will focus more on optimization of the existing capacity?
Sze Ho.
Hi.
Hey, how you doing?
Very good, thanks.
Look, we're moving very quickly. 95,000 milestone is the next phase. We are looking at that already. We're working on the funding, we're talking to investors, we're talking to our shareholders. This is something we will be doing very quick. That's something we have to do next year. Okay? As far as going through the next phase, next fab, as I said, we have enough land there to build the second and third fab. Okay? It's something we're thinking about it because demand is very strong and we expect it will continue to be very strong. You won't be surprised that, by the time we start to expand capacity up to 95k, at that stage, we may be even thinking about the next fab already. It all depends on how the market goes. I think the market will continue to be strong.
I think for us, we're comfortable and we're confident. We still have limited capacity. Demand requests from our customers still cannot be completely filled. I think it's always something that is very good to think about.
Okay, all right. Maybe a hypothetical question. Just assume you hit the 90,000 wafer capacity milestone, and then back to back, you immediately kickstart more expansion. How are you going to fund the expansion?
There are many ways to do that. Many different ways. Okay? We can do a deal just like what we did before. Our 12-inch and 8-inch fabs are generating a lot of, you know, cash flow. We can use that as a sort of equity investment. We can invite the local partners, we can invite the big fund. I think the semiconductor big fund is very important for us. I mean, they can take more stake in the deal in our next fab. There are many different options. We can potentially do a listing. These are all different options.
Okay, great. All right, last question from me. After 55 nm, we'll have the 40 nm, 45 nm supposedly. When would that be ready in terms of the technology offering?
Can you repeat that, please?
I think for the 40 nm, 45 nm offering, when would that be available to our customers?
You know what? I would pass this on to Mr. Tang.
[Non-English content]
Thanks to some new applications for specialty technologies, we can achieve above 100% utilization in our Hua Hong Wuxi fab.
[Non-English content].
After completion of our 48K investment, we will achieve 65K monthly capacity by the end of this year, for the majority growth will be 55 nm technologies.
[Non-English content]
In the communication with customers in the near years, customers have strong demand for the 55 nm in their specialty technology application
[Non-English content]
Our R&D team make a great process along with the capacity expansion. We have some new applications introduced in the 55 nm technologies that will make a bigger contribution going forward.
[Non-English content]
If our customers have this requirement or demand on the next generation technology, say 40 nm, we can always cooperate.
[Non-English content].
We do 40 nm or not, basically will based on the demand on this technology, specialty technology. We take responsibility for our investors. Thank you.
Congratulations.
Thank you.
Thank you. The next question comes from the line of Jian Kuai from Orient Securities. Please ask the question.
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
We start the CIS, the R&D from 2 MB, but now we have mass production for five, even eight. If we do higher density, just based on the customer's demands and requirements.
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]。
[Non-English content]
[Non-English content]
Thank you. The next questions comes from the line of Yang Luo from Credit Suisse, please ask.
[Non-English content]
[Non-English content]
Hua Hong is the first 8-inch fab in China. Up to now we have been operating for more than 24 years. During this long period we have built very good relationship with all the vendors.
[Non-English content]
Based on the good relationship and the long-term partnership, all the vendors give us great support. We have around 200k 8- inch capacity, Now we are going to achieve 65k monthly capacity for 12-inch fab. You can see from the financial statement all the operations are very stable. Along with the operations, our capacity is steadily growing. In the process, our raw materials and wafers, it's very stable. No problem at all.
[Non-English content]
We treat overseas suppliers and domestic suppliers equally as long as the products meet our requirement. We support our domestic tools and domestic raw materials.
[Non-English content]
Thank you.
[Non-English content]
[Non-English content]
Market applications are growing, the demand are growing, the capacity expansion is always a topic for our industry.
[Non-English content]
We have more than 20 years R&D base. We have very diversified experience and we have very many long term customers. We have more than 10 years relationship. For the Hua Hong Wuxi fab, we started some customers from 0.18 micron- 0.11 micron to 90 nm- 55 nm. Customers have good expectations for technologies and we have very good relationships and expectations for the long term cooperation.
[Non-English content]
From our point of view, we can do our specialty technologies, meet customers demand and market demand, and we believe our capacity utilization we can keep at a very high level.
[Non-English content]
Thank you.
[Non-English content]
Thank you. Our last question comes from the line of Ziyuan Wang from CITIC Securities. Please ask your question.
Thank you for taking my question. [Non-English content]
[Non-English content]
We were achieving 65,000 wafers capacity by the end of this year, among which we have 18K power discrete and 47K IC. Among the ICs will be 3/4 will be 55 nm technology and will make great contribution for company's revenue growth.
[Non-English content]
We will have clear planning for the next step. We will make full use of the clean room. We expect can be above 90K monthly wafer capacity, and this part of investment will be started by the end of next year.
[Non-English content]。
We believe the capacity utilization will be very fast to be fully utilized.
[Non-English content]
If we build another fab and how to build the fab, for which technologies, our management team are study and investigate. I believe the plan will be in the near future.
[Non-English content]
If the plan is clear and we have got the board approval, we will make announcement.
[Non-English content]
[Non-English content]
[Non-English content]。
[Non-English content]
[Non-English content]
Well, between 20K-30K for the analog and power management.
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
Ladies and gentlemen, that's all the time we have for questions. I will now hand back to Mr. Daniel Wang for closing remarks.
Well, again, I want to thank you all for joining us today and asking all the wonderful questions. We hope you will join us again next quarter. Please continue to stay safe and healthy. Hopefully we'll be able to meet in person in the very near future. [Foreign language]
Ladies and gentlemen, thank you for your attendance. You may all now disconnect.