各位投资人，各位投资界的朋友们，还有媒体，大家平安。我是联咏科技的副总经理及发言人陈建新。非常欢迎大家再次来参加联咏科技二零二二年第一季的法人说明会。最近国内的疫情变得非常严峻，也在此祝福大家，希望大家都能安康。也是为了大家的安全，我们还是维持在线上来进行。今天的法说会会同时用中文还有英文来进行。今天的会议的议程如下。首先，这里由我这边先用英文报告联咏二零二二年第一季的结果。接下来会由我们的王守仁副董事长针对第一季的结果做进一步的说明，同时也报告第二季的展望。最后，会开放给各位问答的时间。各位可以通过线上发您的问题，先上传给我们，我们 IR 主管 Tony 收到以后会帮忙用中英文来发问，会由我们的副董事长，还有我们的财务长周胜城，还有我本人会用中文来回答各位的问题，然后再翻译成英文。Dear investors, analysts, and media.
Good afternoon. Welcome to Novatek 2022 first quarter online investor conference. This is David Chen, Vice President and Company Spokesperson. I'll be the host for today's conference. As local pandemic situation has become more serious, and considering everyone's safety, we decide to maintain our investor conference online. Please be reminded that all questions can be sent in by text during the conference. The agenda of today's event will be as follows: First, I'll be reporting Novatek's first quarter results in English. After that, our Vice Chairman, Mr. Steve Wang, will provide more details on our Q1 results, and at the same time, give us the guidance for Q2. Following that will be our Q&A sessions. As mentioned earlier, if you have questions, you can send them to us by text. Our IR Director, Mr.
Tony will be processing and reading out the investors' questions one at a time, both in Chinese and English. Our Vice Chairman, Steve Wang, CFO Mr. Zhou, and myself will try our best to answer all the questions, first in Chinese, and then translate them into English later on. As usual, please take a look at our safe harbor notice. It's boring, but important. Let's start with our 2022 Q1 financial highlights. Our net sales in Q1 was TWD 36.51 billion, slightly down QoQ 0.08% from TWD 36.54 billion, YoY up 38.48% from TWD 26.37 billion in Q1 2021.
Gross profit in Q1 was TWD 18.52 billion, down 1.47% from last quarter TWD 18.8 billion, and up 60.99% from TWD 11.51 billion in Q1 2021. Our gross margin in Q1 was 50.73%, down 0.72 percentage point QoQ from 51.45%, YoY up 7.09 percentage point from 43.64%. Our operating expense in Q1 was TWD 5.24 billion, down 2.02% QoQ from TWD 5.35 billion, YoY up 22.07% from TWD 4.3 billion. Q1 operating income was TWD 13.28 billion, down QoQ 1.26% from TWD 13.45 billion, YoY up 84.18% from TWD 7.21 billion.
Our OP margin in Q1 was 36.37% down 0.43 percentage points QoQ from 36.8%. YoY up 9.02 percentage points from 27.35%. Q1 net income was TWD 11.13 billion, up QoQ 1.84% from TWD 10.93 billion. YoY up 89.52% from TWD 5.88 billion. Overall Q1 EPS was TWD 18.3 versus last quarter TWD 17.97, a QoQ increase of 0.33. Last year Q1 EPS was TWD 9.66, a YoY increase of 8.64. Please take a look at our Q1 consolidated income statement. Next is our Q1 sales breakdown by product line.
SM DDIC, which is the small and medium driver, accounts for 41% of our total sales. SoC, which is all non-DDIC, accounts for 31%. LDDIC, which is the large driver IC, accounts for 28%. We have just released our April sales, which is TWD 12.32 billion, month-on-month down 1.2%, YoY up 11.15%. The net sales for the first four months is TWD 48.83 billion, YoY up 30.39%. SoC accounts for 34% of our sales, and DDIC accounts for 65% of the revenue in April. Comparing our 2022 and 2021 monthly sales, we are seeing significant consecutive YoY growth for the first four months. Next, let's look at other key financial numbers.
Our cash and cash equivalents in Q1 was TWD 67.82 billion, increased QoQ by 12.78% from TWD 60.13 billion. YoY increased by 133.23% from TWD 29.08 billion. Accounts receivable. Q1 was TWD 23.93 billion, increased QoQ 1.5% from TWD 23.57 billion, and YoY up 48.49% from TWD 16.11 billion. Inventory. Q1 was TWD 16.34 billion, QoQ up 15.16% from TWD 14.19 billion, YoY up 68.41% from TWD 9.7 billion. Short-term loans. Q1 was TWD 0. The following slide is a recap of our recent major events.
Novatek board of directors approved the date of our AGM, which will be on June 8, 2022. Next will be the Novatek board of directors proposed a cash dividend of TWD 51.5 per common share with total amount of TWD 31.34 billion, which resulted in a payout ratio of 80.63%. Now I'll turn over the call to our Vice Chairman, Mr. Steve Wang, to provide us more detail on Q1 results and Q2 guidance.
Uh.
主要是，这个产品组合，变动的这个影响。Thank you everyone for joining in our Q1 investor conference, and I would like to wish everyone the best of health. Our Q1 revenue pretty much in line with our guidance, and YoY up 38.48%. Our Q1 margin was 50.73%, which reached the high bar of our guidance also.
This is mostly contributed by the product mix. 现在呢，时序也大概进入了这个第二季了，已经过了四月，已经过了。这个Q2啊，看起来这个总经的变数呢，是比较多的。大环境呢，目前看起来受到这个通货膨胀啊，还有升息循环啊，另外还有这个俄乌的冲突，跟中国几个城市的封控的影响呢，有一些这个不确定的因素在干扰。所以看起来终端消费性的产品的需求呢，感觉有比较疲软的情形，客户也有些进入这个调整库存的这个阶段。此外呢，大陆有些城市的封控呢，也影响了一部分供应链的物流了，还有部分厂商的这个生产。所以在这种情况下呢，我们给Q2的这个guidance呢，这个营收呢大概会在TWD 345亿到TWD 358亿之间，这个是用汇率二十九来计算。毛利率的区间呢大概会落在46%到49%之间。而营益率呢，应该会介于32%到35%之间。那这样的一个guidance呢，以我们的三大产品线来看的话呢，如果以QoQ来看的话，就是Q2对Q1的这个情形来看，SoC的这个产品相关产品的这个销售呢，看起来在Q2应该会持续地增加。但是在大尺寸这里呢，看起来呢应该会slightly down，就是会稍微地减少。那在中小尺寸相关的这个driver IC来看的话呢，由于这个手机这里呢修正会比较多一点，所以看起来会有这个衰退的这个情形。那以上简单跟大家把Q2的outlook呢跟做了这个报告。Now the following is the overall guidance on our second quarter.
Recently, as you all know, the overall macro environment is full of challenges. We're seeing these inflation and the rate hike issues. Then we have the Russia-Ukraine conflict. This is actually causing a lot of uncertainty. We're also seeing the China's pandemic lockdown in major cities. All these actually have impacted the overall demand. We're seeing that some of the customers are in the process of inventory adjustment. We also think that the China lockdown has also impacted the manufacturing sector, which in turn has disrupted the supply chain.
Based on the above macro situation, our guidance for Q2 will be for the top line, we are guiding for TWD 34.5 billion-TWD 35.8 billion, and this will be at an exchange rate of 1 to 29. The gross margins will be 46%-49% range, and the operating margin will be from 32%-35% range. Basically, if you look at the overall top line, our views on Q2 will be, we are expecting SoC to be slightly up and the large driver segment to be slightly down.
For the small and medium size, due to the inventory adjustment, we are expecting some decline for our small and medium-sized the product line. This will be the overall our guidance for our second quarter. Thank you, Steve, for the Q2 guidance. Next, we'll move on to Q&A section. Please be reminded to send in your questions. We have already received some questions, and we'll start with those questions first.
接下来是请 Tony 这边，针对我们手上已经拿到的问题，开始来发问。那其他的如果还有问题的可以，趁这个机会也可以传进来，我们也会一一地来帮大家来发问。Tony 请。
好，先把几个关于第一季数字方面的问题整理一下，然后我们先从回顾来看。第一个问题是关于营收，在指引的358亿到368亿的上缘。请问三大产品线的季对季表现情况是如何呢？
基本上，三大产品线的结果，跟我们所预期的大致上都符合。也就是说，各位可以看到我们的结果，在 SoC 这里，我们确实是有一些成长，在第一季。那中小尺寸这里，确实有略减，那大尺寸的这个驱动 IC 相关的，大概有一些小幅的衰退。
First, let's wrap up some questions regarding your first quarter results. The first question is regarding your revenue in first quarter. The figure came out at the mid- to high-end of your guidance of TWD 35.8 billion-TWD 36.8 billion. I just wonder if you can provide more color in terms of your three big divisions performance in terms of quarter-over-quarter trends.
As you can see, the Q1 numbers we just reported are all in line with our guidance. If you look at the three major product line, as expected, the SoC slightly up, and small and medium-sized TDDI slightly down, and the large size TDDI decline. This is pretty much as expected.
第二个问题是关于驱动IC这一块，想请问一下，在大尺寸，还有中小尺寸这边的季对季的出货量的趋势是怎么样？然后单价的趋势大概是如何？
以这个中小尺寸的TDDI来看的话，在第一季，这个手机相关的TDDI，我们的出货数量是持平的，但是在平板这里，出货量是有些微的减少。那OLED的部分，因为春节有一些产出来不及，所以OLED看起来有小小的减少，在OLED这里，这个是小尺寸的部分。那大尺寸的这里，
由于这个第一季有春节这个因素，而且是假期，所以看起来TV的需求呢，是比这个IT的需求呢，要比较weak一点，这是大尺寸的这个部分。
Regarding your driver business, could you provide some color in terms of the shipment as well as the ASP trend for your small medium size driver as well as your large size driver?
Well, the overall small and medium-sized driver, it seems that the smartphone TDDI unit shipment was flat, but the TDDI for tablet was down, and the OLED was slightly down QoQ. This mainly due to the Chinese New Year and less number of working days.
第一季是什么表现比较好，那其他的产品线的情况是怎么样？
以刚刚提的是，主要是驱动IC的部分，那如果以SoC的这个产品线的部分来看的话呢，因为我们在营收是刚刚跟大家报告，是有一些成长的，这个成长，SoC的成长的部分主要是在TV SoC呢，或者是在scaler啦，这个影像处理相关的这个产品呢，在第一季呢，是成长的主要来源。
Now switch to the SoC business side, which provide the quarter-over-quarter growth in first quarter. Could you provide more color in terms of individual lines within the SoC business group?
As for the SoC product line, as mentioned earlier, it QoQ slightly went up, and this growth was contributed by TV controller and image-related product and scaler.
刚刚您这边已经有提到毛利率的这个 comment，那可以这边补充一下，关于营业费用率这边的第一季的情况吗？因为这个百分比似乎比第四季有微幅的下降。
第一季的营业费用率是14.36%，相较于去年第四季的14.65%，是减少了0.29个百分点，那金额是减少了1.08亿，那主要是去年第四季有支付一次性的IT使用费用所致。
Okay, now switch to the margin ratios. You already mentioned about your gross margin. Could you also provide some color why your operating expense ratio in first quarter came down slightly quarter-over-quarter versus quarter four?
The operating expense was down TWD 108 million. This is mainly because last quarter, the Q4, we had a one-time IT usage expense.
那我们再往其他的这个财务数据来看的话，我们注意到你的业外获利在第一季有大幅的增加，那请问主要的项目是外汇吗？那金额是什么？
第一季的营业外收入是4.85亿，主要是汇兑利益就有3.08亿，以及股利的收入有1.33亿。
We notice you had a big jump in your non-operating income. What are the major items underneath non-operating? What's the actual amount?
Well, the non-operating, we have basically two major items, and that one is foreign gain, which comes out around TWD 308 million NT dollars, and then stock dividend of TWD 133 million.
最后一个关于第一季的财务数字，大家投资人可以注意这个存货的金额，我们注意到你的金额季对季的成长15%，到了一个更高的163亿。但是你的第一季，刚刚你也提到是一个季对季持平，可以告诉我们这里的主要原因吗？
由于目前的产能比较紧，生产的cycle time也比较长，所以我们在inventory这里成本上升会有一个递延的效应存在。我们早上检视了一下，这些库存内容事实上是相当健康的，而且是manageable。一般来讲的话，如果市场有些变动，因为生产cycle time比较长，所以一般大概需要两季左右的时间来调整。以现在的疫情不确定因素来看的话，尤其中国大陆有一些封控的情形，因为supply chain有不确定的因素，所以我们也可能会观察目前市场的情况，也会适时地看是不是需要调高一部分的库存来因应这个不确定的因素。
Now we also notice there is a critical financial item, the balance sheet, the inventory number also increased 15% quarter-over-quarter to TWD 60.3 billion, which actually up quarter-over-quarter and versus your flat-ish revenue. What are the major reasons behind that?
Well, due to the tight capacity, everyone knows that the cycle time has been extended. You know, we have actually reviewed our inventory, and in general, our inventory level is very healthy and basically manageable. Usually when there is a tight need for inventory adjustment, usually it takes about one or two quarters to do so. The thing is that if you look at the current situation, the pandemic has actually disrupted the production. We have to take this into consideration. Whenever there is a need, we might need to increase our inventory level to cope with that kind of disruption.
那我们目前大概把第一季的这个回顾的问题大概先做了一次整理。那现在我们把这个问题转向到大家关心的所谓的往前看的这个business outlook。那第一个问题就是overall，刚刚管理层已经给了第二季的营收指引，跟简单提了几个产品线，但是可以多讲一下，就是说在各种的应用的情况，季对季看到的趋势是什么样子呢？
以终端的产品来看的话，由于我刚刚提的那三个因素，就是所谓通膨升息啊，还有这个俄乌的冲突，跟这个中国部分城市的封控。所以我们看到的是有些消费性的产品的终端需求，目前看起来是比较保守的，比如说像手机啦，或者是这个电视啦，还有部分的IT的产品，看起来这个终端产品的需求是有比较保守的。那如果以我们的三大产品线来讲的话，这个刚刚跟大家报告了，就是说我们以季用的销售来看，QoQ来看，就是SoC的部分，我们看到revenue在第二季是会成长的。那在大尺寸这里，应该会slightly down，就是会减少。然后在中小尺寸这里，由于刚刚所提到这个手机会有一些修正的库存调整，所以看起来是会衰退的，在中小尺寸的驱动IC这里。那在非消费性产品这个应用这里，我们看到像一些商用的NB啦，或者一些gaming的NB啦，还有像一些auto的方面相关的驱动IC啦，或者TDDI啦，还有TV SoC呀，scaler方面，我们看到的是以季用的销售来讲，应该会是比较持稳的，会是比较持稳的。
Yes, we've already kind of wrap up the question for first quarter recap. Let's move forward to talk about the business outlook. The first question is, the management already provided the second quarter revenue guidance, and also the trend for your three business lines. Could you also provide more color in terms of various end applications in terms of quarter-over-quarter trend?
Well, as I mentioned earlier regarding the macro environment, with inflation rate high and the Russia-Ukraine conflict, all these lockdown issues, what we see is there are more conservative spending on the consumer side. Like the end applications like smartphone, TV, and some of the IT applications. While we are expecting SoC to be up QoQ, and the large channel drivers to be slightly down, and small medium-sized, because of the inventory adjustment, are expected to decline. Looking at some of the non-consumer side, on the commercial side, like the gaming, or like the commercial notebook, auto or TV-associated scaler, we're expecting it to be more stable.
大家现在，刚刚管理层提到的，现在整个东南充满了很多变数，但是不知道管理层是不是可以跟我们分享一下，目前对第三季的这个整体的趋势需求的一个初步的看法。
往前看的话，我想最重要的是我们要观察我们刚刚所提的这三个因素，在外在环境后续的发展情况如何，我想这是最主要的。那当然我们也有看到一些比较正面的，像我们所了解的，大陆的六一八，事实上会推出不少新机种会launch，所以这里我们也是可以看到有一些可以期待。还有欧美呢，目前看起来对疫情有逐渐开放的情况，所以今年的back to school是不是可以有一些销售的期待呢，这里我们也会持续来观察。
I wonder if management could provide some very preliminary thoughts on the third quarter outlook.
Well, you know, looking forward to third quarter, I think the main thing we need to keep watch, the changes in the environment as mentioned earlier, including the, Russia and Ukraine conflicts and some of the China lockdowns. It depends how these turn out. We need to keep a close watch. On the positive side, we have, you know, the China's biggest shopping festival, which is 618 promotion. We expecting there will be a new model launch. Then of course in North America, Europe, you know, the pandemic is getting under control. Hopefully, you know, the seasonality will return. Like back to school, some of these are something that we can, you know, expect.
在这边的话，因为现在的公务面整个需求的变化也比较大，那管理层之前也提过，有跟客户签一些比较中长期的订单，可以跟我们谈一下这种订单的形式，或者会可以有怎么样的一个变化吗？
基本上，我们跟客户或者是跟供应商之间，我想我们基本上是一个长期的 partnership 的关系。所以任何我们有这个 LTA，基本上我们是跟客户和供应商之间双方有一个 agreement，在这种情况之下来签约的。但是，因为 Novatek 我们的产品线是比较广的，那因为市场有不确定的因素，所以因应这个需求的变化，对 Novatek 来讲，我们的产能可以比较具有弹性的来调整到不同的应用市场，因应市场的变化，基本上是这样。
Also, I wonder, given the increasing uncertainty in the end market, you mentioned before you have signed some commitment or contract with your customers. I just wonder, can you provide more color in terms of how you or your customer can adjust its agreement with you?
Well, regarding the LTA, if there's any, usually, you know, the way it works is that we in order to maintain the long term and a strong partnership with our customers and our suppliers. It depends on the supply and demand situation. We try to resolve this issue together. Okay. On the other hand, you know, as you all know, Novatek has a much broader product lines and therefore, depending on the demand, we can always make adjustment to make the best use of the capacity. Maintaining that kind of flexibility is something that we've been doing.
也想请教一下，因为公司主要驱动IC跟面板的产业紧密相关，可以分享一下目前看到的这个panel产业的趋势，在产能或产能利用率这边的情况和趋势，未来一两季是如何呢？
因为市场的需求的变动呢，是比较快速一点最近，所以呢，我们也看到观察到的是，面板厂呢，他们也是因应市场的需求呢，他们也是动态调整这个生产线的这个 production。
Also, your company's display driver is highly related to the panel business. Just wonder if you can also give us some color or you have seen the trend on the panel production side.
Well, as you can see, recently there is changes going on the demand side on the panel. You know, the panel maker usually they adjust the product mix according to the supply and demand situation.
公司也提到现在看到很多的变数，以及有一些订单的调整，不知道这里可以跟我们分享一下，目前看起来今年整体来看，哪几项产品的成长还是会比较高一点，有一些机会吗？还有也可以提一下特别值得注意的新产品。
我们以现在这样的一个情况来看，我们基本上看的都是稍微比较长期一点，不会只看今年。那如果以这个两年的时间来看，我想大尺寸这里，我们看到的就是说有一些高阶的IT的需求，这个看起来是不错的，而且我们在这上面的产品开发也是比较领先的，像一些gaming的这个应用的display，另外还有像8K的display，看起来采用的客户也越来越多，而且像一些high speed interface的产品，在这里我们觉得这个长期展望应该也是不错的。那如果以中小尺寸的这个driver来看的话，或者是相关的产品来看的话，像手机OLED的这个产品driver，或者是这个notebook跟平板的这个OLED driver，这个是目前刚启动的阶段。那像OLED TDDI，或者像这个汽车使用的这个LCD的TDDI，或者像这个AR/VR，还有一些特殊应用的TDDI的ASIC，我们看到未来应该长期也是有不错的机会存在的。那另外在SoC产品相关方面，像4K UHD一百二十赫兹的TV SoC，我们觉得应该在未来一段时间会成长上来。另外像安防，或者是gaming的产品，还有一些跟PQ或者是display相关的ASIC的chip，我们觉得应该有不错的机会，这个是以比较长期来看的话，我们应该有不错的成长的机会。
Yes, given the recent increase in certain cases and the shareholder adjustment, could management still provide your business outlook in this year or more in the near term in terms of product opportunities?
As we look into the mid- to long-term product opportunity, you know there are a few areas like the large-size driver. We are expecting on high-end side for the IT applications we've been leading and still leading in this area in terms of technology and product offering, and we are expecting there will be more adoption of these high-end solutions. You can see, look at the gaming side. We've been doing very well in the gaming side and we expect it to continue the momentum. The 8K display, we are seeing that more and more designs and more and more customers adopting the 8K display, so there will be more opportunity in that area. You have the high-speed interface product, where you know you need the very high-speed interface and Novatek, we have a lot of good high-speed interface products. On the smaller device area, we have the OLED for smartphone, and then we have OLED for the notebook and tablet, which we just started providing our customers. There are OLED TDDI and then automotive LCD TDDI. We have some ASIC TDDI. We also have AR/VR applications. These are all potential markets and basically we have our technology already ready. On the SoC side, we are seeing the 4K 120 Hz TV SoC to the advanced gaming. Especially you look at on the picture quality and display related side, we are expecting more ASIC business. These are some of the mid- to long-term business opportunity or the product that we are expecting to ramp up in the near future.
那我们把这个问题移到第二个段落，那很多投资人确实关心这个整个供应链的一个状况，那可以请管理层分享一下，整个现在的这个晶圆这边的供需的情况是怎么样？那也提一下，之前也提到有跟供应商这边有提LTA，不知道这边会有什么样的一个影响。
以今年 wafer supply 的这个 slide 来看的话，在大尺寸的 driver IC，或者是在 TDDI 的这个 driver IC 相关的，目前看起来供应是正常的，是比较 balanced 的。但是我们也看到有部分的制程，逻辑制程，像逻辑制程，我们也看到是需求还是比较紧的，因为这些有一些其他的需求，需要做一些调整，所以看起来也是仍然还是相当紧绷的情况。
Now we shift the question to more on the supply chain situation. The first question is about the update on the foundry supply as well as we wonder if you can provide some comments on your LTA with your foundry supplier.
Okay. First of all, looking at the foundry supply side, for the large panel driver or TDDI supply. Currently the supply are normal and, some of the process nodes, for example, the logic process nodes are relatively tight, due to rush orders.
那第二点可以提一下，刚刚提到了，今年这边，那也可以提一下封测的供需情况，那这边价格的趋势也可以跟我们分享一下吗？
以封测这里我们来看，目前看起来，供应应该是正常的，供应应该看起来是正常的，但是有些时候是有一些不可预测的情况，可能有物流上面，有时候会稍微拉长一点，不过供应方面来讲看起来是没有问题的。
In the foundry supply, could you also comment on the supply and demand situation for the packaging and also possibly the ASP trend for this area?
Oh, for packaging side, there's no supply issue, but sometimes, there is a market decline due to some logistics issues.
最后这边除了刚刚提到的Foundry跟Packaging这边，可以提一下有其他的原物料的供需的情况或价格的走势吗？
目前其他的原料看起来应该供应也都是正常，供应也都是正常的。不过在成本上来讲的话呢，我们也是依照依据这个市场的供需状况，然后跟供应商保持一个良好的沟通，去做一些动态的调整。Again呢，我想联咏跟客户或者供应商之间呢，基本上我们都是一个长期的partnership在走的。
I also wonder, can you provide a demand-supply situation for your other top supplier?
Well, in general, I mean, the other parts are pretty much normal. Of course, if there is any supply demand or some of the cost issue, we do sit down with our supplier and work on it. We maintain a long term partnership. Whenever there's any changes or any needs, we collaborate with our supplier.
接下来几个问题是大家对于这个关于毛利率方面，第一个是想问一下，这边有看到竞争对手的库存金额有大幅的增加，我们知道这对于整个市场的，联咏这边的竞争或者出货量会有一些影响吗？
这个库存的增加，我想应该是后面是可以调整的，不过基本上来讲，我想价格跟供需还是息息相关的。那在driver的部分，目前确实如果有需求上的调整，我想这个竞争应该是会存在的，竞争应该是会存在的。
We noted the inventory data for some of your competitors have increased, sequentially and significantly. I just wonder if this will impact the competition or ASP to Novatek ?
Oh, as mentioned earlier, our inventory level is pretty healthy and manageable. Of course, if there is any inventory, it always can be adjusted. Whenever there is any cost or ASP issue, we reduce it down with our supplier to work on it.
第二个问题就是管理层的第二季的指引，有提到整体的毛利率会比第一季看起来是有一些下降。那想请问一下这边是哪几个产品下降的幅度比较大，那可以再往前看一下，如果看到甚至往前看的趋势会是怎么样？
我们跟客户都是一个长期的关系，所以售价上我们也是依市场的情况、供需的情况，跟客户保持良好的沟通。在我刚刚给各位的有关Q2的guidance里面，$0.46到$0.49，事实上我们已经把售价的相关因素也把它考虑在内了，所以我想这个应该是一个可控的范围。
Given your gross margin guidance for second quarter, the range will be down quarter over quarter. Just wonder which product will experience more sequential margin decline. Also could you provide some color for your second quarter.
Well, as mentioned earlier, I mean these issues are always dealt with with our supplier and customer altogether. The overall pricing issue or cost issue is still manageable. The Q2 margin that we not released earlier, basically they have already factored in all these issues.
开始看到公司的毛利率有一些下滑的趋势。想请教一下管理层这边，有采取什么样的行动来让整个售价、出货量或毛利率能够相对比较稳定的。
我想这个最大的重点呢，还是在这个产品的设计技术，或者是制程技术上的这个使用。另外呢，我想开发这个value added的这个新产品呢，还有强化这个product mix呢，来提高毛利率，我想这个是我们一直在做的一个事情，一直在进行的一个事情。
Given your downward margin guidance, I wonder if the management have taken some activities to limit this OP margin downward trend.
Of course, I mean, as a company, this is something that we need to continue to make effort. The best way to do it is, you know, enhance the technology both from the design level and from the advanced nodes that we're using. We also need to develop more new value-added products and also enhance our product mix. These are some of the ways that we can do to enhance our margin.
关于毛利这边，不知道管理层可以提一下对于，今年或中长期这个毛利率趋势的一个看法吗？
基本上，有关Cap我们没有提供这个预测，所以有关这个长期的我们没有办法在这里提供。但是有关毛利率，我想公司我们自始至终，同仁都是朝这个提高毛利的方向来努力，所以提高毛利率我想是我们一贯的努力的一个目标，而且我们也做了很多事情，就像刚刚所提的，除了技术以外，像custom base或者是不同的应用，另外我们也会强化我们的产品组合，来提供给客户，等于是一个total solution的方向，这是我们做的最大的一个努力在这上面。我想长期来看应该是可以看得到一些回报的，应该是可以看得到一些回报。
As for the gross margin trend, I wonder the management can provide your view for 2022 or even a little bit longer term?
Basically, we don't provide annual guidance, but as a company, I mean improving margin is always our top priority and goals. I mentioned earlier, we've been you know effortlessly you know expanding our customer base and providing a more better product mix. Also we provide a total solution to our customers so that to help them add value to their product. These are some of the things that as we are working on it, and this will bring more contribution to our margins.
现在还有几个关于公司整体的问题。第一个就是我们看到公司已经宣布发放一个很高的现金股利，但是看到公司还有很多现金，不知道说还有没有什么其他的一些计划，比如说库藏股。
我想这个主要我们在过去以来都是一直维持着这个high payout ratio，所以我想这个也是我们作为对股东的一个回报。当然我们手中还是维持持有一些现金，我想这些现金可以让我们能够保持一些弹性，可以做一些事情。这个事情呢，我们也是在未来的一段时间，我们一直在观察。
We notice you already announced a pretty generous dividend payout for 2021's ending. Just wonder if you have any other plan for your cash usage such as share buyback.
Well, you know, as I said, I mean, we've been maintaining high payout ratio for a number of years, and this is what we've been trying our best to do to, you know, returns to the investor. Of course, it is always wise to maintain some cash level, especially during this kind of volatile environment. Maintaining this kind of flexibility is a good thing for the company. 开玩笑讲一句话，这个人是英雄，钱是胆，这个会比较好做事。Okay, this is difficult for me to translate, but the cash on hand is always easier to deal with when there's any crisis.
第二个问题就是，看到过去几季这个库存金额有一直往上升，请问一下第二季末的库存金额还会持续往上吗？那想问一下有没有觉得会什么时候才会回到比较安全的水准呢？
这个在刚刚有跟大家回报告过了。基本上我们的库存是不会让它失控的，但是因为过去以来这个生产的cycle time比较长，所以这个库存如果要调整，通常是需要大概两季左右来调整，是比较有可能的，因为生产cycle time比较长。不过我们也考虑观察到最近的这个供应面的不确定因素确实是比较有，所以我们也会视这个需要的情况，我们会去调控这个库存，如果不确定性因素比较高的话，可能会稍微维持比较高的这样的一个水平。
We notice your inventory dollar has been on an upward trend over the past few quarters. Just wonder if this dollar will continue to go up at the end of the second quarter, and also wonder when this amount of days will get more back to normal level.
Well, again, our inventory level is well under control, so the increase in inventory, as mentioned earlier, is mainly due to longer cycle time. In all of the adjusting inventory level, it usually takes about one or two quarters. As mentioned earlier, we also have to take into consideration the current supply chain uncertainty. If we think the uncertainty is high, then we might need to increase the inventory level. So far, I think the inventory level is very well managed and it's pretty much under control.
下一个问题就是，最近这边也看到很多关于公司的好消息，关于薪资方面这边的调整，那不知道公司今年这边对员工的招募有什么目标，还有目前进展的一个情况。
我想人才呢是联咏一贯以来我们需要去招募的。那我们今年预期来讲的话，希望能够招募到研发人才大概至少有500人。那说话目前进展呢看起来都还OK，我想这个是作为我们在先进技术的研发的投入呢，是很好的一个base。
We know you have paid a pretty competitive base salary as well as the bonus over the past six months. I just wonder if you have any target for your headcount increase for 2022, and how about the progress?
Well, as you know, as the fastest IP design house, talent is the most important thing for us. For this year, we are expecting to hire at least 500 engineers, and so far, so good.
下一个问题是，最近我们看到金管會跟投资人都越来越注重公司的ESG，那想管理层跟我们分享一下，不知道您这边有一些近期的目标，还有目前的进展情况是如何。
因为ESG，我们公司的这个主委就是David Chen，就是陈副总，所以我想这个问题由他来回答最适合。好的，谢谢Steve。基本上，联咏在过去这些年来，我们也被纳入到好多的成分股，包括FTSE4Good，或者说TWSE RAFI Taiwan High Compensation 100，还有TWSE RA Taiwan Employment Creation 99，还有我们在一些Corporate Governance 100 Index里面，都在里面。另外我们在ESG的报告也是得了不少的奖，也拿到一些不错的成绩。我们往前看，我们也会把这个TCFD跟SASB，陆续也都已经加入到我们ESG的这样的一个reporting framework里面。然后有关一些GHG，就是碳，还有这个greenhouse gas这方面的很多certification，ISO、TCS，或者cyber security方面的ISO 27001，这些我们陆续也都在完成的阶段。那我们在2022年开始也会用一些green energy，我们目标是在2030年，希望能够达到25%这样的一个比例。那我目前也花很多的effort在如何去减少水的用量，然后怎么样去recycle，然后再重新reuse这个水的资源。那我们在2021年ESG的报告很快就在六月份就会出版，当然也欢迎大家到我们的网站那边去download，里面的资料非常的完整。Uh, let me repeat that in English.
Well, regarding the ESG, Novatek. Over the past many years, Novatek was selected as a constituent stock for the FTSE4Good, for the Taiwan High Compensation 100 Index, Taiwan Employment Creation 99 Index, Corporate Governance 100 Index. We also received a lot of awards on ESG reports. Recently we are adding the TCFD and SASB into our ESG reporting framework. All related greenhouse gas, all these certifications, will be completed soon. We also have started to use green energy in 2022, and our goal is to reach 25% green energy in 2030. We also are putting a lot of effort in reducing, you know, and then recycling, and then reuse of our water resources.
that would be a very big drop in terms of reduction. Our 2021 ESG report will be published around June, very soon. Feel free to download it from our website for details.
那我们现在进入到比较细的，就个别的这个主要的产品线。那第一个先讲到我们这个现在最大的在手的产品线，中小尺寸，那其中的大家最在乎的一条产品OLED，可以请管理层提一下目前对今年的出货的成长率。那对于这边大家也担心一些整体的竞争情况，还有一些在客户的这个布局，或者还有提一下最近一些新的技术的演进的趋势对公司的机会或影响，谢谢。
有关 OLED driver 相关的在用在中小尺寸这里，我们看到的是今年，联咏来讲，在 OLED driver 这里，我们今年的出货应该是一定会成长的，而且我们在 wafer 的这个布局上，我们会多元化地在这个布局，在 wafer 的这个布局这里。另外，我们今年应该也会陆续推出一些新的产品，来保持我们在 OLED driver 这里的一些技术的这个领先。至于说这个在面板，或者是在客户这里，这个 again 是我们一贯的这个目标，我们一定会扩大这个customer base，然后用这个先进的设计的技术，还有精致的产品组合，另外还有我们的交货能力，来受这个客户的这个肯定。目前一切的这个进展，看起来是相当的，这个机会是不错的，应该相当是不错的。
Now we're moving to more color on the individual business line. First start with the small medium size driver, which is our biggest product group. First will be on the OLED. Could management provide some more color in terms of the shipment target, your foundry partnership, the competitive landscape as well as your relationship with the key customers?
In terms of the OLED driver for the small and medium size, we are expecting our unit shipment to grow this year.
As you know, we consume a lot of wafer each month, and for these kind of new product, it's always wise to diversify to make sure that the supply is enough. This year, we have also, you know, continued to launch new products and to retain our technology competitiveness, especially on the OLED side. We're seeing a lot of progress. You know, our goal is to, you know, penetrate all the OLED panel makers to extend our customer base and, you know, to win our customers trust by providing, you know, more advanced design technology, you know, value added product and of course, maintaining our strong supply capability. So far, all these progress are actually pretty on track and we're getting good results.
接下来，管理层可不可以也提一下今年整体TDDI的一些outlook，也提到像成长率啦，竞争的情况这边。
以TFT LCD的TDDI来看的话，我们今年觉得在手机application这里，我们觉得成长会是比较保守的。但是在其他应用这里，我们看到也有不错的机会，像刚刚提到的那个auto的这个TDDI，还有一些这个ASIC的这个TDDI，我们觉得我们看到也有不错的这个机会。
Now switch to the TDDI, could you also provide some guidance or outlook for your shipments, also the competition from other suppliers as well?
Regarding the LCD TDDI for smartphone, we are relatively conservative on the growth in 2022. We are positive on other application like the automotive TDDI and some other ASIC TDDI. These are some of the areas that we see potential growth.
除了这两个产品线外，公司也一直提到 auto 这边的 outlook 不错，也可以给我们加个 update 吗？
刚刚跟大家报告了，就是，像使用在auto的这个，不管是DDIC driver，或者是在TDDI这里，今年看起来应该也是相当的不错，尤其是一些EV呀，采用这个TDDI的趋势看起来是机会相当的好。我们在一些new model的这个design，看起来现在进展都是相当的顺利。
Now moving to the automotive, could management also provide some color on your progress on the automotive driver business?
Oh, yes, it's very exciting as to the automotive, no matter on the DDIC or the TDDI. As you can see that the adoption of TDDI for the electric vehicle EV, I think it's a trend, and it's definitely positive for Novatek. Recently we've seen a lot of good progress in new model designing in, so we have a lot of high expectation on automotive side.
那最后一个是除了这几大产品线外，那公司也可以提一下过去这一年提到的一些新产品的进展，像是屏下指纹或者是 wearable 的 OLED driver。
有关这个屏下 OLED 面板的指纹辨识的 chip，或者是 wearable 的这个 OLED 的 DDI，目前我们这个都已经在量产当中了，所以今年我们的这个最大的目标呢，是怎么去扩大这个 customer base。所以现在的进展看起来是蛮顺利的。
All right. Now, due to your mainstream product is small- and medium-size driver, could you also provide some update on your new product such as the under-display fingerprint as well as the wearable OLED driver?
Regarding the fingerprint OLED or the wearable OLED, TDDI, I mean, these products are already in mass production. I think our major goal this year is to expand our customer base.
我们讲到这个关于大尺寸这边，第一个也想问一下整体今年2022年大尺寸这边出货的一些展望，还有一些跟一些重要品牌客户的关系的一些机会跟互动。
以大尺寸这里来讲，我们现在看到的是，像UHD一百二十赫兹的这个TV，或者像8K的TV，我们看到这个机会应该是相当不错的。另外在一些这个，我们看到一些NB，尤其是commercial的NB，它从这个HD的resolution，今年看到migrate到Full HD，我们看到这个趋势也是相当肯定的，应该相当明显确定的。那在monitor这里，我想是往这个高阶的gaming啊，或者是industrial啊，这里的这个monitor，或者是一些医疗用的这个monitor，监视器看起来我们在这上面这个机会都是相当不错的，这个是在大尺寸的应用方面。那当然在一些品牌的关系，各位也知道，这个韩国的厂商慢慢也退出TFT LCD的这个市场了，所以我们在这里，应该有看到这个，应该也是机会是蛮好的。
Now switch the question to the large size drivers. Could you also provide the business outlook for your large size driver in 2022 in terms of the shipments, new product as well as the relationship with your key customers.
Looking at some of the applications, we are expecting like the large panel driver for the UHD 120Hz for TV applications or for the higher resolution, so 8K or the commercial notebook, you know, it's migrating from HD to Full HD and it is ongoing. For some of the gaming monitor and then we also seeing the industrial applications and also the medical applications. These are some of the areas that we're seeing, you know, more opportunity. Regarding some of the customer or some of the industry change, for example, now we see the Koreans exiting the TV market, and this is a good opportunity for Novatek.
那大尺寸这边，因为毕竟产品是比较成熟的，那最近也有一些外资报告特别提到一些大陆这边的竞争，那可以管理层提一下这边您怎么看待这些竞争，或联咏能够跟竞争对手的这个差异化在哪里？
在大尺寸这里，Novatek我们所强调的，是一个total solution的provider。这个除了我们在driver以外，我们还有TCON，或者是PMIC，甚至一些画质的picture enhancement的chip相关的，是怎么去跟客户大家共同合作，来往这个附加价值的产品的方向来提供。在不同的应用领域，大中小尺寸这里，我们也是全面来跟客户做这个配合。所以简单讲一句话，如何能够提出或者做出具有附加价值的产品？这个是联咏一直往前走的一个方向。虽然是commodity的产品，我们应该也有机会能够走出一个自己的不同的路。这个路就是怎么去提高我们的附加价值。
The large size driver product, more legacy product, which you also have seen some newcomers from China. Just wonder how Novatek can differentiate itself from the competitor?
Well, as you all know that Novatek, we provide a total solution for our customer, like the driver, timing controller, power management, or even we provide some of those, picture quality enhancement chips. You know, for us, our main job is to provide value-added product to our customer, how to resolve the issue, how to bring value to the product. I think that Novatek, we are in the best position to provide all these technology for various applications, different technologies and different panel sizes. I think even though it's a commodity, but it still can make a big difference by providing all these technologies.
最后我们这边的问题关于SoC这边。关于SoC这边整体的展望中，管理层有提到，像第一季甚至第二季TV SoC的成长都是相对比较亮眼的，但是您刚刚也提到TV这边的需求是遭弱的，这边可以再补充一下吗？然后，TCON这边也可以多提一下这边跟竞争的一些新产品这边的进展吗？谢谢。
以2022年来看，我们看到在UHD 4K 120赫兹的TCON周期，我们看起来今年的市占应该是可以增加的，而且这个看起来目前都是进展得相当顺利。另外第二个在这个TCON的产品，我们看起来机会也相当不错，尤其刚刚跟大家报告有一些高阶的产品，比如说像一些TED的产品，甚至未来有一些eDP 1.5的这些产品，我想这些新产品的高阶产品的机会，我们看到也是相当好。另外像这个TCON，像那个OPPO使用了这个TCON，我们目前看起来进展也相当不错，甚至客户也都已经开始要使用。然后在power方面，我们觉得display power以外的这个应用，我们觉得应该未来可以有一些成长的空间。
Now we switch the question to the SoC line. Could you also provide a color on your performance within your SoC line? Particularly you mention about the outperformance for your TV SoC in both first quarter and the second quarter compared with the softness on the driver business. Also, could you also provide more color on your T-CON business? Thank you.
Well, in 2022, we're expecting more UHD 4K 120 hertz, you know, to increase the market share. So far the progress is very positive, so we expect to gain more market share in that area. Regarding the timing controller, I think there is a great opportunity, especially for the high-end application, like the new TED, or as we move forward, we'll be also launching the eDP 1.5. On the automotive side, we also have provided timing controller solution for our customers, and they're starting to adopt those solutions. On the power management side, we are also working on the applications beyond display, and we do expect the business to grow there too.
SoC刚刚提到了这几大主要产品，那我不知道管理层这边有没有什么新的产品的一些机会可以跟我们分享一下吗？
我想刚刚也跟大家报告了，除了以上所说的以外，如果以比较长期来看的话，未来一两年我们觉得AR/VR呢，对Novatek来讲，我想长期我们应该看起来有不错的机会的，那这个也是可以期待的。另外呢，在未来我们在看到的还有一些跟PQ或者跟display相关的ASIC呢，这个business，ASIC business呢，我们觉得应该也可以往前有不错的这个发展。尤其呢，跟display相关的，这个是我们这个core competence的所在。所以，跟王守仁刚刚跟大家报告的，我们怎么能够在commodity这里呢，能够做出一些不同的地方呢，我们基本上就是用这个技术，或者是用这个process node怎么来提升我们在这上面的这个附加价值。
Let me also ask, could management provide some color on the new business opportunity regarding your SoC line?
Oh, for the new product, you mentioned some of them already, but just to sum up, as in the mid terms, I think AR/VR will provide a good opportunity for us, and we do expect to gain more business in this area. Of course, as you all know, for Novatek, display the image, this is the core competence for Novatek. Moving forward, we expecting to have more picture quality or display related business, and this will be something that we're looking forward to.
再整理一下，好像还有几个新的投资人的问题。那刚刚管理层有讲到第二季整体这个中小尺寸的方面，季环比会掉。但是想请问一下，里面的OLED DDIC的第二季的出货跟第一季相比会是怎么样的一个趋势？
目前我们看到的第二季对第一季，这个OLED应该是持平的，出货的数量应该会是持平。
Okay, management did mention about the sequential decline on the small medium size driver in second quarter, but wonder how about the trend for your OLED DDIC shipment in second quarter?
Our OLED DDIC shipment in second quarter will be flat.
第二个是关于财务的数字的问题，不知道可以请财务长这边再给一下今年对营业费用率的这个指引吗？还是除前面两季到——
15之间，营业费用率。
Okay, the next question is about financial guidance regarding the OpEx ratio, just wonder if the full year OpEx guidance.
The OPEX ratio will be roughly around 14%-15%.
第三个还是关于第二季的财务数字的guidance。刚刚公司有提到第二季的营收是345亿到358亿，刚刚报告的是四月的营收是124亿，想请教一下现在五、六月的这个趋势大概会是一个怎么样子呢？
目前看起来，如果用这个去把算的话，各位可以去计算一下。
Just wonder, your management already provide your second quarter revenue guidance, and also release the April revenue. Just wonder, can you provide more, monthly trends, for the second quarter?
Yes, we already announced the release of our April numbers. Basically, the guidance for the whole quarter are maintaining at what we just mentioned.
蛮多投资人有一些问题，刚刚管理层尤其在大尺寸这边有提到，联咏如何跟竞争对手，尤其来自于大陆竞争对手去差异化，那可以提一提，对于像在中小尺寸或者甚至SoC这边，管理层这边也可以多跟我们分享一下吗？
刚刚跟大家报告了这个，怎么提出，怎么去做出这个具有附加价值的产品呢？这个是我们一个大的方向。在大尺寸这里是这样，在小尺寸这里呢，我相信我们的这个技术应该算，以现在这个 display technology 来讲，我想我们应该算是一个相当领先的公司。所以在这里呢，我们一定可以除了在 driver 以外，我们可以提供一些不一样的售后服务之外，比如说像 high speed interface 啦，或者各种不同的这个应用的场合之下呢，怎么做到比其他的同行做到更省电呢，类似这样的一个方向哦。所以我们的 core competence 呢，是我刚刚提的，我们的这个 PQ，或者是我们的这个 image 处理相关的这个 core competence 这里呢，我们一定应该可以在这上面做出一些差异化的方向出来。而且我们现在发现在这里，客户对我们的这个刚刚所提的这些 technology 呢，客户是相当 appreciate，客户是相当 appreciate。
Management already mentioned about how to differentiate itself from competitors for small medium-sized driver. Sorry, for large-size driver, just wondering if management can provide more color, how to cope with the competition for other product lines, such as large-size driver, small medium-sized driver and SoC product.
Well, we've already mentioned earlier that for the large size panel driver, we've been always trying our best, you know, to bring value or the value-added products for customers. As you all know, when you look at the small and medium size, currently you'll notice that technology-wise, we are the clear leader in this area, and we'll continue to maintain that kind of lead by introducing or launching more better product, for example, high speed interface, or some of the better picture quality or lower power consumptions. So far, I think most of our customers are very much very happy with our product and really appreciate for those kind of products that help them in terms to win in the market.
有一个问题是，大家——投资人问关于比较OLED技术面这边，想问一下对RAMless产品今年的这个渗透率，那这个产品会对ASP竞争，或者对wafer的consumption会有影响吗？
基本上，有些客户为了降低成本可能会考虑RAMless，但是有些客户为了这个picture quality，还是会keep这个RAM存在。所以我们的看法是这两个产品都会同时存在的。所以基本上是看客户对这个的需求跟要求是什么。因为比如说你有RAM，你可以做到更省电，你可以做到这个picture quality可以更好，类似这样。
The next question is about some technology migration on the so-called RAMless. Just wondering if you can provide the progress for this RAMless OLED driver.
Well, depending on different customers, some of them, due to cost, they might select or adopt some of them using RAM. But, as you know, if you use the RAMless, of course, cost will be lower, but performance-wise, with the RAM, in order to have better picture quality, and then you can have a lower power consumption. So my view is, I think both of them will exist at the same time. Yeah, let me see if there is any more questions. I know it's about time. Okay, I think, pretty much we already went through most of the questions. Thank you so much for your time, and wish you all the best, and keep safe, and keep healthy. 谢 谢 各 位 。