Welcome to the MediaTek 2018 Third Quarter Investors Conference Call. Your speakers today are David Kuo, MediaTek's CFO, and spokesman, and just one, Mr. Tak's Manager of Investor Relations. Ms. Jessie Wang will report 3rd quarter results first, and Mr.
Debbie Kuo will prepare our prepared remarks. And after that, we will open Q And A. Now, I would like to turn the call over to Ms. Jessie Wang. Ms.
Wang, please go ahead.
Good afternoon, everyone. Welcome to MediaTech's third quarter 2018 conference call. As a reminder, Full content provided on this teleconference This is for informational purposes only. I intended for investment advice. Under the issuer or any of independent providers, is liable for any actions.
It can be reliance on content content gearing. MediaTek provides non PIFRS financial measures that supplemental information. Earnings distribution is made recorded with financial statements based on PI on our end. I authorize porting or redistribution of the video, audio text, and the presentation contents of this teleconference is truly prohibited. By participating in this teleconference, you agree to accept the foregoing terms and conditions.
Now let's start with the 2018 third quarter financial results. The currency here is in NTDAR. Revenue for the quarter was $57,000,000,000, up 10.8% sequentially. And up 5.3% year over year. Gross margin over the quarter was 38.5%, up to 0.3 percentage points sequentially and up 2.1 percentage points year over year.
Operating expenses for the quarter were $19,500,000,000, compared with $19,000,000,000 in the previous quarter and $18,200,000,000 in the same period last year. Operating income for the quarter was $6,300,000,000, up 54.2% sequentially. And up 27.2% year over year. Operating margin for the quarter was 9.4%. Compared with 6.8% in the previous quarter and 7.8% in the same period last year.
Net income for the quarter was $6,900,000,000 compared with $7,500,000,000 in the previous quarter and $5,100,000,000 in the year ago quarter. Net profit margin for the quarter was 10.3% compared with 12.4% in the previous quarter and 8% in the year ago quarter. EPS for the quarter was $4.39 compared with $4.75 in the previous quarter and $3.26. In the same quarter last year. Please note a net name on the profit margin and EPS in the previous quarters including one of non operating disposal gains, which were not recurring this quarter.
We also provide non PI buyers financial measures which exclude share based compensation, amortization of acquisition related assets and tax effects. Please refer to press release and presentation for details. For the fourth quarter of 2018, we spent revenue to be in the range of $59,000,000,000 to $64,300,000,000, down 12% to 4% sequentially. And a forecasted change rate of $30.80 to $1.00. We are forecasting the gross margin as 38.5 percent plus or minus 1.5 percentage points.
And the quarterly operating expense ratio to be at 32 percent plus or minus 2 percentage points. For the shipment guidance, with the shipments of smartphones together with tablet to be between 101110 million units in the 4th quarter. Now I'd like to turn the call to CFO, Mr. David Group, for prepared remarks.
Thank you, Jesse. Good afternoon. I firstly, I'd like to talk about the 3 major business segments, the overall performance in the 3rd quarters. The first one is mobile computing business, which including smartphone and tablet, for 3rd quarter, revenue coming from mobile computing come from around 30% to 35%. I think specifically for smartphone, think the new product, Helio P22 and 822.
P22 is our management product, and 822 is the entry level product. Both further adopt pretty good, the customer feedback. I think so we're making good team roles in market share gains and, customer like Xiaomi. Vivo, also for Helio P50, which is the main new hybrid product, we also adopted by Copilot Vivo, and started specifically in overseas markets such as India and Southeast Asia. In, end of third quarter and beginning of the 4th quarters, We also start introducing our new Helios price called Helios P70.
That's an, mid to high end product. Basically, that's the, new product after D Sixty. We have, enhanced AI engine and improved overall performance in terms of power consumptions, and the AI capability in P Sixty. I mean, the P Sixty is scheduled to be, mass production in 4Q this year. So I think other than the P50, P70 this year's and also P22 and P22, the new product for 2000 first half twenty nineteen is also, we're preparing it on the way.
I think we are kind of expecting before end of this year's we will also announce, the first half of next year products, maybe events or probably launching them, sometime in December. Other end, Helio product, I think we're also working very diligently and aggressively for our 5 g product portfolio. Like what we disclosed earlier this year, I think the first CDO M Seventy, there's a modem product, will be ready in first half of twenty nineteen next year. And also, I think, by end of next year, we will also have about 1st 5 g to 5 g s o c ready by endofnextyear. I think that comes through with, the first patient section about mobile's computing platform.
The 2nd business group is, we call the gross product business group, which includes, IT, power manager IC, the PMIC, and also customer asset. I think for this group of, catalysts, accounted for a good 30 to 35 percent of overall revenue in the third quarter 2018. I think for, for 3rd quarters, especially for the growth sector, we see a pretty strong seasonality, strong, basically, a more than double digit growth in IoT, PMIC, and ASIC. Especially for IoT, I think, the, market share leader in VAD. And now we see, the last drenching problem or dilutive products from the VAD, by our customers, for example, it's like, Amazon, Echo Dot, and, Firing to be state, small plot, and maybe even, microwave.
Automotive is the voice assistant device products. We continue to improve our wireless back and also the AI audio integrations. And for the machine to machine, we also start to ship, Narrowband IoT key products. We believe that will be another growth driver starting from 4th quarter A and also extend to 2019. For power manualized lead business sectors, we see, pretty good revenue growth through group synergy.
On top of PC segment and now actually expand that into the smartphone subdirectory segment. We also expect more revenue contribution from TV on the smartphone side, starting from second half of twenty nineteen. For the customer ethics side, we see a very strong seasonal sales, in the 3rd quarter, especially for gaming asset IC, The other one that gave me is that I see, our high speed transmission 35 p product, which we've been launching successfully. Now we're working, with our customer, the product is getting out, the whole system being validate. I mean, the overall progress actually looks smooth.
We're expecting the product will start to ship, basically, second quarters next year. For the, the last one of the, the business segment is called the Harvest Products segment, which are including TV. Feature phone, audio storage, and DVD. I think for our harvest product segments accounted for 30 to 35 percent of our overall revenue in third quarter. 2018 as well.
I think about 3rd quarters, I mean, the the final round is slightly better than expected. Due to strong season demand, especially for TV. We also, see some early point TV situation basically the 3 orders, from 4th quarters to 3rd quarters. I think for TV, we now did integration with MStar as we progress, the overall, the full integration were happening in January 1, 2019. We expect that the combined synergy will provides, a pretty good saving, and plus we'll continue to enhance the market share and also the profitability.
Other than the business segment updates, I think I also like to take an opportunity to talk about, the 2019 recap. I think for 2019, overall, we see a pretty solid progress on product compared to this improvement. Especially for smartphone and also just the market share gain for the Tier 1 customer. As you can see, we rarely see pretty good operating margin dollar improvement, both from quarter over quarter based in third quarter or year over year basis for the first three quarters 2018, we actually will continue that improvement on profitability, in fourth quarter and hopefully first half twenty nineteen. As well.
I think the overall strength for 2018 and also for the carry over for 2019 is to try to be much more balanced and diversified stroke on fundamental. All three different business units, basically, mobility, growth sectors and also the harvest sectors. For 2019, overall, we find the buzz for the macroeconomy and also the, the industry cycles, the side media cycle. Somewhat at higher uncertainty. So for 2019, we will be a little bit more cautious based on the current view of early information.
But despite of the short term volatility, I think we will continue our investment in 5g, AI, asic, especially for data asic, and also related to new area to increase our product, technology, competitiveness, and platform. And we believe I should continue investing in low share, we will lay down a good foundation for the mid to long term growth going forward. I think that could be my convenience. Thank you.
Thank you, David. We're now ready for Q And A session maybe. The first question please operator.
Yes, thank you. We are now in question and answer session. You. And as a reminder, it is greatly appreciated that you turn off the speakerphone mode of your device, percent. Thank you.
The first one we're having here is Randy Abrams, Credit Suisse. Go ahead please.
Okay. Yes. Thank you, David, for the introduction. I wanted to ask the first question, just a follow-up on the macro I guess we can we can also see some of the pressures in the financial markets in some of the segments. I'm curious though from from your business, if you're starting to see that slowdown in customer activity, whether the mobile, or if it's showing up in some of the consumer growth products.
And both from a units, but also from pricing environment, As you look at the 2019 uncertainty, is part of that an ASP and maybe more uncertainty on being able to hold this margin gain that you've been able to achieve over the past year?
Hi, Randy. Actually for the 2019, Hope more, we don't have the detail of its abilities, all the way into 2019. But based on what we see, especially for the fourth quarter, we do start to feel let me see what's the right one. I think the uncertainty involved here, especially is due to the macroeconomic situation and also in the cycle somehow start to get out of it, but it doesn't mean we see any concrete evidence or signal yet, but just when we talk to our customer, when we talk to the channel, I think people just started to feel cautious about the 2019. I mean, I guess there's no surprise part of the reason due to the China, so and also the US, the trade war right now.
But we also understand there's gonna be the ongoing process. Whether or not, there will be a determination that you need. Maybe, maybe not. But I would say, the the MacBook Economy probably just want the factors. We'll just see some other effects as well.
I mean, again, it doesn't really see any company's evidence or signals, just when we talk to our customer, I think people start to cautious about 2019, especially for the first half of twenty nineteen.
Okay. And I did want to ask on the industry cycle. We are, I guess, we up notes late stage 4G. We're coming off in China 2 years. I guess on the official or the MIIT would show it down double digits.
Our customers, I guess, factoring in the macro, are they kind of giving a base view that mobile market may still have a third down year next year. And I guess circling back to the pricing, are you seeing signs that the pricing environment may get a bit more severe? Or is it still ongoing kind of the same pressure you've seen? No real change in the pricing environment?
I would say both for the 3rd quarter and 4th quarter, we generally see since the pricing that I'll be getting was, I would say it's the a similar, it's compacted fashion bound result.
Okay. And on mobile, I guess on a base Stewart. Are your customers giving you a feel that we may have another down year for mobile shipments at this stage for next year?
I think, right now, most of our customers are planning for next year shipment. Besides your problem, obviously, I think most of them have treaties aggressive targets back here. But when you talk to the supply chain, when you do that, truth with other people, I guess, again, doesn't mean that people feel, negative or anything like that for next year, but just people talking about, being prepared for the past, but, somehow, the volatility, the uncertainty, so many beauty problems, if you get kind of feeling, feeling that's an active feeling, it's not a beauty. I'll look at Okay. We don't have it.
It's gonna be it's gonna be a great real impact in 2019. I think that's something that's giving up, sir.
Okay. And I wanted to ask you on the high end product mix. If you could give a flavor, I know you don't have the Healios kind of expanded, but the way you use to think of the category P60, P70, P22, where your unit volume now a kind of a rough range where you're back to on unit volume. And it looks like when Qualcomm kind of moved a product into snapdragon 7 100, it may have slowed the momentum on P60. So if you could talk about maybe expectation for P70, regaining a bit of that mid to high end share in the market?
Well, I think this year is, we have a pretty good market share in through the P Sixty And these are basically just to follow-up products. This is basically is, is, we upgraded a lot of features, both from performance and also a consumption perspective. So far, I guess, the design email, so design win, actually, is, like, the product was all shipped. Customer product was actually in fourth quarter this year. So overall, we feel it would be, not just secure warm up this year for the media line this year.
But we, come 10, maintain their market share. And, hopefully, we can continue to expand both on the p 6p 70 and also data early last year, PAH product.
Okay. And the last question, shifting to networking. For now, you're getting the product kind of finalized to go into production. Could you give us a flavor a bit on the ramp up you're expecting and maybe if you've done some sizing on the type of market, you're coming after as you start moving into this networking category?
I think this is only our 1st or second project, win. So far, based on the schedule, I think most likely we'll start to see some sort of early revenue, maybe after 2nd quarter next year. So so far, Tobi Gallo, the system validation from Wells, I still sometimes bring it up. But the good news is actually, now actually with these successful chair records, we are getting a lot of activity going on. I won't categorize it.
It looks like, you know, it's not wind yet, but obviously, the momentum looks, very possible. But in terms of the overall addressable market, we don't have a fixed number yet, but, given the fact, actually, the data generation. And I guess we do believe actually the addressable market is actually, is the long term growth. It's pretty solid.
Okay. And can you give flavor the scope like what exact opportunities you're targeting? Is it more on the enterprise like ethernet networking or more into carrier networks? Or, like, can you give a little more flavor on the type of, area if you wanna go into here?
Well, I think data switch test won't have to, on top of the list. There's obviously some post data center and also for, that incorporates, the, the, the, the, the corporate is, IT's, name for it that IT rings actually, so I think that's definitely on top of everything. And also, actually, right now, there are lots of different customer applying that technology, new applications for Central Science for maybe for AI collisions, maybe for audio collection. I mean, generally, high speed service is a very fundamental to IP because of climate high speed service, drive different areas on top of data switch business.
Next, we're having Cocoa Hari Haran, JP Morgan. Go ahead, please.
Yeah. Hi. Thanks, David, and Jesse for taking the questions. Couple of things I had. 1, could you talk a little bit about what you seeing in terms of the, next year's high end products and what it means for ASP.
Are you seeing pricing go up on a like for like basis for, let's say, PAT was a 360 or some of your family, And, if smartphone ASPs go up, due to in, in most markets, due to increasing, features, Is there any chance that you could see from ASC increase during the next year?
Well, I think based on the current product portfolio, especially if you cover with the potential 5 g, end of next year. As you know, from the product communication perspective, that should be positive to from the ASP, a blended ASP, perspective. But by saying that, I would say, the ASV, I think problem mix is what drivers, but other drivers would be the competitive landscape. So far, I think, for 2019, that's still something is is on the operations. So q54, I think that looks okay.
Know, okay. That mean good. Okay. It just means, just didn't really get worth getting worth. But for 2019, that's something we still need observed.
So, From product portfolio perspective and suggest continuing to enhance the product portfolio, continue to balance what we call the documentation expansion. Okay, get into a financial level to retry in and, you know, we need to do that. But for the compacted lens, we have, you know, compact pricing, That's what you would still be observing next year.
Yeah. Hello, Dakota. Are you still online?
Yeah. Hi. Sorry. I was on mute. Thanks David for the answer.
Please, I could check on the ASP for this year for smartphone products. How much of the ASPs up on a year on year basis in 2018 roughly?
I think for the full year, I would say, pretty much, it's a 5 days to Maybe 0 to 5%. Yeah.
The flat is okay. Secondly, on the gross margin side, can you talk about what is your thinking about gross margins I know that in the Mandarin call, you guys, we don't want to guide about whether it's upside to gross margin. Could you talk about what are the kind of variables that go into your gross margin expectation going into next year, given that product portfolio is still getting better. Some of your growth points are still exact rating?
Well, I think for 2019 gross margin, we're probably not able to provide, guidance of you here. It means that I just, 2 choices to talk about that. I mean, we we will definitely provide some visibility in the 1st quarter next year, but right now, actually, the inventory to talk about that.
Okay. So on the CV product, you had some gross margin drag in q 2 and q 3, you can already come back in q 4, or is that something that comes back in 1st half of next year?
I think with digital TV, we do basically phasing some of the market pressure this year, mainly due to the embedded DRAM It's a local that KGV is our pricing. The good news is actually the pricing started to soften me and coming back where they started coming from before. But we probably won't see that, effect into our, you know, cost until the first half next year because we still have some inventory issue if we solve that. So, this year, the gross margins, on the digital TV side, so they're building 4th quarter out, so it probably just flattish. Hopefully, starting from next year's, after we can pass about the the viewing issue, memory issues, which you see some solid value of those volume in this year.
Okay. And, lastly, you mentioned that, some of your 5 gs early product is starting to sample the customer talk a little bit about what the feedback on your stand alone 5G modem has been from customers. And, Could you also, remind us in the timeline? I think I've missed that on both, standalone clip modem as well as, embedded grocery for 5 gs.
Well, I think for next year's, the 5 g gold is, the EagleM section 17 will be ready first half next year. I mean, that that notice, why we have a a state of home loan that is actually next year, even from operating perspective, the code, the 5 g is a preconscious which means, I mean, we need to work. I do a lot of work to make sure, the, the IoT with operators that work smoothly. And having the sale of homeowners and working on that is actually much easier and more, efficient. But in the same time, I think we will always have the 5 g s l c product.
Starting, m for 2020 product cycle. And I always actually starting from 2020. I should probably most likely we'll stop, from, mid to high end. And we'll stop earlier and, start to expand the financial product portfolios from top 2 maybe mid-twenty 21.
Okay. And are you seeing anything changed in terms of the pace of adoption that you expect on 5G and, previously, you were expecting more than, like, in 2020 or 2021?
Not really. Not really. I think we, again, that'll be used. 2019 will be, from operator perspective, we are laying out the foundations, which means start to, kick in the CapEx on the base station sunshine. So I'll start working with formulating also just a major to, you know, pre commercial launch for the 5 g image of the networks ready, for the testing, IoT testing, the stretch shaft.
Probably the real, year, the 1st year for the meaningful, a small, meaningful shipment for 5 g when it went for 2020. And if you charge me for all the bases, or maybe by end of 2020, we'll see some more value or shipment. But, you know, basically, if that's all in 'nineteen, you'll be pretty commercial launch, 220
Okay. Got it. Thank you very much.
Right now, we are having Brett Simpson from Arete. Go ahead, please. Yes,
thanks very much. David, just regarding the rising import tariffs into the U. S. I'm just wondering what effect that's having on your business right now. I mean, a lot of talk about pull ins customers pulling in and shipping earlier to avoid the rising tariff in Q1.
Is that something you're seeing? Is Q4 demand sort of inflated because of this tariff hike? And maybe you can talk about what that might mean for Q1. Do we see a bigger than seasonal decline in Q1? Thanks.
Well, I think the point effect we talked about earlier is actually mainly on a digital TV side. So So maybe you might be one of the reasons, for the TV put in, it's actually due to, the US, the input tariff. But, in reality, I guess, I would say that your, input tariffs will impact due between, because there are lots of digital TVs and manufacturers or companies that do have manufacturing national facilities outside China. So, which was just helping to reduce the impact, from Sarah. On the other hand, for auto layout of this, it's actually, it's, especially for this model, mean, most of the smartphone, either of you saw it, China or the emerging country.
So they impacted you, cost by the import tariff. It's actually somewhat humidity made more as well. So overall, I would say, the 4th quarter's demand, I would say it's actually normal, and I would say there's actually inflated due to the full year.
Okay. That's helpful. And anything you can sort of share with us on inventory channel, inventories across the businesses that you service anything unusual you're seeing on inventory side?
From our perspective, especially in emerging market and the smartphone channel, overall, I think, the the channel level is the channel inventory level for our perspective is actually pretty normal. We don't think this is the overstocking, you know, it's too low. Okay.
That's helpful. And then, David, just on 5 g, you haven't announced any design wins per se yet. Can you maybe talk about sort of customer engagements, the level of customer engagements you're having today? And do you think this is an area where we're going to see some significant government handset subsidies, you know, as we start to get into the, the the ramp phase, the meaningful ramp phase, probably more like 2020. But can you share with us what you think, the, the sub on the subsidy side?
Because we haven't we've seen subsidies get cut consistently over the last couple of years in China smartphone subsidies. Is that likely to reverse when 5 gs starts ramping? Thank you.
I think currently, to be honest, actually, would you really see any aggressive subs that are probably ready yet? Because, from my perspective, maybe it's a little bit too early to mature to talk about that. After all, even for 2019, for an operator perspective, especially in China, probably the main goal of the major task is to start to build out the network. So, if there's gonna be anything, on 5 gs model, we I can most likely, it will be very small balance on a trial on trial basis for 2019. So, in terms of time stamps, we probably need to weigh second half of next year to help us get more about, you know, all three, major operators view or plans about subsidy program for this year.
Okay. And then in terms of customer wins for 5 g, anything you can how many customers are you engaging on 5 g today?
I think it's, all the, obviously, the lead from customer in China right now is, I'll tell you about 5 g color portfolio. From a smartphone perspective and we're in discussion with most of them.
And just shifting gears to AI, David. We we're seeing guys like Google come out with some standalone dedicated AI chips for the handset. The Google visual, the visual, core, most, most guys like, like, media tech are putting AI cores into the SOC today, do you think we're gonna the how is this gonna develop? Because I guess looking at camera specs, we're gonna see a lot more AI process requirements in the next couple of years. Do you expect to see dedicated standalone AI processors to emerge?
Is that something that you think is inevitable in smartphones over the next sort of 1 or 2 years?
From our perspective, especially for, mainstream and maybe even to, mainstream high end if we don't come in on a flagship product yet, we do believe actually an embedded AI processor, but our perspective, we have some for the MD08, the machine learning accelerators, probably make more sense, both throughout the cost, and also from a performance perspective. For example, our, currently 70 and also our next generation product here in E. We will all include, pretty powerful MBO in theirs. And after talking to the customer and also lots of the developers, they are all happy about our gut performance. Whether or not they will have a requirement for a stand alone, separate ad professors, I'll not do this as a super high end flagship products, overall view, specifically on the smartphone side, for the mainstream, they mean, you know, mentioned high end, I think the embedded processor should be true enough.
And then and then just for
unless unless when we are getting just with the next phase of AI, people truly go crazy about, you know, trying to leverage more AI calculation capability. But from our perspective, at least for the 1st batch, you know, taking pictures, you know, project, recognitions, almost to the found AI function. We've served well already for the MBOA, but whether or not it's just just because the 1st batch of the application, you know, going forward, people find more air application, they will find more, you know, superior new power that will lead to a separate chipset. My book. Okay.
But at least for this, for next years, and that's not mostly.
And just maybe final question on AI, ASICs going into, data centers. I guess you have a lot of the IP that's needed to develop these AI, ASICs. And you mentioned 30s, 112 gig, 56 gig 30s is something you, your, you're offering today, are you guys developing any AI ASICs for the cloud either on behalf of customers or independently for for yourself?
No. Actually, currently, I think the the major AI building block was doing right now is actually, the sort of NDA, the basic AI point we got in is our CPU. For our expectations right now, we generally be using AI as a for our customers.
Next one to ask questions is Michael Joe from Deutsche Bank. Go ahead, please.
Hi, Davy. Just a quick question. Regarding the smartphone GSP, what is the training to 3 in the Q4 this year?
I think for, smartphone, for Q2 and Q3, in general, it's actually flattish. I would say
pre fax. 2 free faxes. 2 4 as well. Right?
2. Yep.
Thank you so much. Then I have no questions. Thank you so much.
Ladies and gentlemen, we are now in Next, we are having Charlie Chan, Morgan Stanley. Go ahead and ask your questions.
Hi, David, just I want to make sure for the autogist disposal again, is that going to happen again in next quarter? And what what is the amount?
I think we recognized, for this year, we recognized in Q2 already. So, that's all for this year. So we might have a much smaller portion for maybe Q1 and Q2 next year. I think the overall amount probably around, a slightly less than a 1,000,000,000 in tea. Maybe, 1st quarter than next year or even more than next year.
I think for the expected timing of those are the long, but depends on the, the, the performance this year. So that's still something that we'll evaluate. But for this year, that's all basically all been recognized in reporting Q2 financials in Q2's non operating income already.
Yeah. So 2Q was around $3,500,000,000, right? So are you saying 1Q 1Q next year will be around the 1,000,000,000 only?
Probably, I left it. Again, that that's a 40 numbers, because we didn't see you. I find it was, performance
Okay. So it is something due to the accounting rule change, right? It's just the the the timing you you booked the, the disposal again?
Right. Right. Right.
Okay. And secondly, can I get some breakdown for your, smartphone shipment, by region today? Yeah, I just want to get a sense, you know, your exposure to different end markets, China, India, so, Africa, etcetera. Thanks.
Sorry. We actually didn't provide, that level of details. So maybe just, export versus China. I think for this year, I mean, exporting is around 60 to 70%. China is about 30 to 40.
My intern insurance, but not China area. I would say it's in India. It's definitely on top of the, internal market shares.
Okay. Okay. And let's see. So so, several, you must have asked about the pricing, competition, right? So So do you see more competition now using mid to high end like a P series or coming from those low end 4G segment?
I'll say both because, if we based on what we see for pricing environment, both Q2 and Q3, I think, both for entry level and also for mainstream, which is the usual piece here are all facing pretty strong pushback from our competitors. As you know, I mean, if you look at the market shares, the first half versus second half, what I say market share is referring to our market share for the, should be the top 4, top 5 guy. I mean, overall, we do mortgage share comes in to expand and balance sheet, put lots of pressure on our competitors. So you can assume that it definitely comes back. With pretty aggressive pricings, you know, competition.
So, this is, like I said, it's a retired leader during this call. I think the completions, especially for the pricing completions, it's, it's stabilizing. It's actually the same. And but the good news is actually out. We don't see it's getting worse yet.
Okay. Yep. Because, You just said that blended that fee seems to be quite flattish in the recent quarters, right? So if we want to take a look at, Apple to Apple ASP erosion. This year, you know, how much it would be for this year, ASP erosion?
I think it's, a like a like basis. I think it's still coming down. I would say it's, 5% plus minus. Okay. Maybe you can put the temperature.
I mean, the reason we have a slightly less about here is because the problem is against
Okay. So it is around 5 5 to 10%.
Oh, correct.
Okay. I I think for full year. That that sounds quite quite, reasonable, healthy, I I would say. Okay. That that's all my questions.
Thank you.
Now we're having Gokulhali Harlan, JP Morgan. Go ahead, please. We are not able to hear you clearly. Got a lot of static.
Hello? Can
you hear me?
Yeah. Now it's better. Go ahead, please.
Yeah. Sorry about that. So on the growth segment, David, could you talk a little bit about what is your growth outlook for next year, given some of the macro uncertainty? Are you still looking at, double digit growth, next year. And, within the growth systems, maybe you could, rank which are the areas where you see the most promise going into 2019.
Thanks.
So can you repeat the question again? I'm I realized you have some problem here.
Yes. Hi. So my question was, could you talk about what is the expectation for the growth engine segments in terms of growth next year? Are we still at double digit, maybe closer to 20% kind of growth. 2nd, within the growth segments, what are the areas where you see the most promise from our growth perspective next year.
Okay. I think for the growth sectors, for next year, again, there may be a little really talk about the detailed growth rate, but just in general, based on, the sophistication of the product line on the new the growth sectors and also, the spreadsheet officially on the gaming side. I can know who would feel, is, still having the chance to develop these growth next year.
Okay. And what would be bionic and the NB IoT or, it's basic for by next year?
No. For I think for next year, the MDL, she definitely would one of the drivers. In general, it's actually X IoT, especially Wi Fi for next year, we still see, those from the product upgrade and also the, the market share gain on the on the Wi Fi side. And PMIC was the more and more PMICs, our our smartphones, our sub payment, and also for the payment organic growth, which is on the PC and the monitoring side. I mean, it's, that's what we see for the 3, some potential growth drivers automist growth sectors.
Thank you for all your questions. Now, I'll hand it over to Ms. Jeshua for closing comments. Jesse, please go ahead.
We would like to thank you for your participation, and thank you. You may now disconnect.
Yes, we thank you