Q3 2024 Ambarella Inc Earnings Call
Thank you for standing by and welcome to Ambarella third quarter fiscal year 2024 earnings Conference call. At this time all participants are in a listen only mode. After the speaker presentation, there will be a question and answer session.
You will be limited to one question and one follow up to ask a question. During the session you will need to press star one one on your telephone.
Move yourself from the question queue, you May press Star one one again.
I would now like to hand, the call over to D. T corporate development Lewis Gearhart. Please go ahead.
Thank you Latif.
Good afternoon, everyone and thank you for joining our third quarter fiscal year 2024 financial results Conference call.
On the call with me today is Dr. Fermi, Wang President and CEO, Brian White CFO.
John Young VP of finance.
The primary purpose of todays call is to provide you with information regarding the results for our third quarter.
Fiscal year.
2020 for the discussion today and the responses to your questions will contain forward looking statements regarding our projected financial results.
Financial prospects market growth and demand for our solutions among other things.
These statements are based on currently available information and subject to risks uncertainties and assumptions should.
Should any of these risks or uncertainties materialize or should our assumptions prove to be incorrect.
Our actual results could differ materially from these forward looking statements.
We are under no obligation to update these statements.
These risks uncertainties and assumptions as well as other information on potential risk factors that could affect our financial results.
Are more fully described in the documents we file with the SEC.
Access to our third quarter fiscal 2024 results press release transcripts historical results SEC filings and a replay of today's call.
We found on the Investor Relations page of our website <unk> com.
10 of todays call as well as the materials posted on our website, our ambarella <unk> property and cannot be reproduced or transcribed without our prior written consent.
For me will now provide a business update for the quarter, Brian will review the financial results and outlook and then we'll be available for your questions Jeremy.
Perfect.
Thank you Louis and to go after every one.
In a challenging market our fiscal Q3 revenue was slightly above the midpoint of our guidance.
Our business appears to be in the process of stabilizing, whereas our customers seem to be making progress with their inventory management efforts.
We expect our customer to emerge from the cyclical downturn at different times throughout the next year and are considering all of the dynamics at this time, we continue to anticipate we will return to growth in fiscal year 2025.
We remain determined and focused on our strategic R&D priorities for the introduction of our portfolio with <unk> and the silver targeting more sophisticated AI inference workloads our confidence.
In the secular growth opportunity for infants AI processors, and the sulfur we met high.
And our long term serviceable market opportunity CAGR estimate has not changed.
Our <unk> two family of Asos East is expected to lead us out of the cyclical downturn and represent a larger portion of proportion of our total revenue in fiscal year 2025.
As a reminder, the.
This product family establish umbrella in the AI inference market and this asos east I expect it to approach 60% of our total revenue in fiscal 'twenty four.
No single Chip see me too products typically provide both video processing and AI inference processing for one or more cameras.
The average selling price of this product is closer to $20 range below 10 to about $50.
In particular I want to point out that C V. Five the flagship RCV to family and the umbrella first find that will meet our asos C is forecast to generate meaningful revenue next year with more than 10 customers in production.
Our <unk> III platform is expected to generate production revenue from the automotive market in calendar year 2026 MPR.
<unk> pipeline includes a family with asos, Yeah, Sofa, and we began to assemble the C V. Three dash eight associate a year ago.
And today I'm pleased to announce during Q3, we received our first silicon for series 3086 by 685 <unk> the flagship our CV three portfolio.
And we are in the midst of a successful bring up of this extremely sophisticated 10 billion plus transistor Soc.
We expect to deliver engineering samples to customers in Q1 next year and we are on track.
Through the previously announced award for Continental till the first OEM to start production in calendar year 2027.
C. B three <unk> are based on our third generation <unk>.
There is technology and service significantly more challenging AI inference workloads, such as a partial or complete autonomy in vehicles.
In addition to providing it.
Single S O C. The perception processing for multiple camera inputs C. B III associates for the first time enables centralized processing overall rate readout data as well as deep low level fusion with state of art, although sensing modalities.
The <unk> III family Asos, wrenching price from $50 to more than $400 per <unk>.
There are two additional elements of our <unk>, our <unk> III platform, both both of which are software.
Sure.
This includes ocular adaptive AI read a perception software and our complete autonomous driving software stack, both optimized to run with <unk> III.
Since November 23, we have been providing demo rides to Oems and tier ones based on <unk> and the hour.
Palmas, driving stack with centralized radar processing low level fusion and the the Aqua I read a perception a chauffeur.
And we will continue to time all this at the CES in January.
Now I would like to provide an update of our AI platform.
During the last quarter with the implementation of a new era of am software building blocks on the C. V. Three J D will have now successfully demonstrated inference Ronnie.
And by my true 13, P model with Asos using L. P. D D Alpha memory instead of high bandwidth memory.
And the operating at a fraction of the power consumption of incumbent solutions.
Some of our existing customers are evaluating how they will implement AI and larger language models at the age of their networks.
With our successful demos and additional analysis, we have concluded the powerful and highly efficient AI inference processor embedded in our <unk> <unk> is a well suited for this age markets. We all have we will have more updates on our strategy at the CES 2024.
Once a year update of our automotive farnell, which is meant to be a reference for our automotive customer engagements over the next six years.
We completed a formal update in November and it increased 4% from $2 $3 billion to $2 $4 billion.
It's comprised of a one business of about $800 million and the pipeline of about $1 $6 billion.
With our automotive business expected to generate about $80 million in revenue. This year. The $2 4 billion six year Farnell is an indication of the strong growth that we anticipate for the automotive market.
There were significant number of upward and downward revision in our formal calculation this year, including forecast changes and the project delays from both tier ones and Oems.
<unk> won or lost in the pipeline and the English.
Of new projects.
C V Street represents a large portion of the current funnel, even though C. V. Three revenue is not expected to commence until calendar year 2026.
I will now discuss represented customer engagement in this quarter.
In automotive we are continuing to win new designs in China, the world's largest automotive market. The open architecture, our CB flow AIA, saucisse enable leading Chinese tier ones and Adas software provider to develop highly differentiated fully featured solutions during.
During the quarter GAC introduce all new passenger car models, incorporating ambarella is a C V 22, Ecu automotive asos ceased in intelligent eight that assistance.
This include the GAC Cianci, eight and E S nine and IL hyper H D and S. Max.
Also a high kind of introduce it's V O nine minivan with AI assistant also based on our C V 22 <unk>.
And the ACI ACI I see introduce it's a max of Stockyard, seven minivan, including a camera minds assistant, replacing left and right mirrors and the pace of our C. V 22 F S functional safety SLC.
In the automotive aftermarket Asia market leaders think were introduced its <unk> XD.
D V are based on our CV twenty-five AIA Celsius and the there is 200 pro two channel TV outpace our <unk>.
And the European market leader in that space introduce its IQ smart Dash Cam private line using all C V 22 automotive asos.
Featuring <unk> resolution.
<unk> AI based threat detection.
In the enterprise security camera market, a number of the leading manufacturers introduced new cameras based on our flagship find nanometer CPU five and the civic 52 families.
Motorola introduces new age six eight product line, featuring AI based video analytics and up to eight megapixel resolution based on our civic 52 AI processors.
And Japanese market either April analysis, New ex series featuring totaled nine model.
Spending box indoor Ito and Aldo torn models up to eight megapixel base I'll see me, it's like 52 S. Ocs.
And the Korea market leader Hotwire introduced its a C 344, or four multi directional outdoor camera based on our <unk>.
Also during the quarter of a cargo introduce a C. P 52, EU Pan tilt zoom.
<unk> camera based on our C. V 22 S O C offering camera operators family coverage of a Y areas and featuring five megapixel resolution and <unk> optical modules.
And the Germany.
<unk> introduced its first ambarella based camera.
X team Malibu for life.
Imaging analysts of space on our C V 22 associates.
Even small home Sacramento.
Signify the Philips lighting spin off known for its a hue lighting products announced is our Philips hue secret secure cameras.
Based on our C V I a soc the camera is kind of walk was a hue lights to control lighting and the sound allowance to deter intruders.
Also during the quarter equity, a leading home automation companies announced its a smart doorbell camera Apis on OCB 'twenty I 28 <unk>.
In November in SAR 316, introduce its ace pro and <unk> action camera based on our <unk> five and the civic 52 AI Soc.
The Ace probe is the first 8-K consumer action camera and both cameras include advanced AI features such as the noon hour based noise reduction 14, Mega pixel computational photography voice and gesture control and automatic video editing.
Collectively you can see over what is that exactly activity is healthy across 13 different representative customers for 17 different projects nine auto in eight in Iot.
Furthermore, 16 of the 17 representative engagement utilize our higher value I E. R. S. Ocs.
You can also see we're successfully implementing more sophisticated AI workload in our asos.
It was highlighted was the identification of a 40 different C D five customer engagements.
Looking forward, we believe our newer products such as the C. Five C V 72, and see me three are well positioned to support increasingly sophisticated AI inference workloads.
And this new product ramp and as we also capture more software value. We believe we can capture more value of parties islands.
Now I would like to give an update on changes to our management team. We previously announced in October 18th 2023.
Brian our CFO will retire from his role as a CFO at the conclusion of the current fiscal year ending January 31 2024.
I would like to thank his contributions to the company, including helping them navigate the challenging inventory correction. The semiconductor industry is currently experiencing.
Well, it's continuing to strengthen our financial team and position us for success as we continued our transition into larger markets.
I'm also pleased to announce that young young currently our VP of finance will assume the role of CFO on February one 2024.
Joe has been with ambarella for more than six years, serving a variety of our finance and accounting roles and we are confident that he will continue to be a valuable contributor as we seek to drive our transformation forward and grow shareholder value.
Now I will hand, it over to Brian to discuss the Q3 results and outlook in more detail.
Thanks, Jeremy.
Before I begin I'd like to thank for me and the board opportunity I've had to be part of the special team here at Kemper Ella.
The timing of my upcoming transition is facilitated by the progress we've made in developing the people processes and tools.
To support Ambarella at the next levels of growth and profitability.
I have complete confidence in John's ability to take over as CFO and the team he has to support and I look forward to their ongoing success.
I will now review the financial highlights for our third fiscal quarter and provide a financial outlook for our fourth quarter ended January 31 2024.
I'll be discussing non-GAAP results and ask that you refer to today's press release for a detailed reconciliation of GAAP to non-GAAP results.
For non-GAAP reporting we have eliminated stock based compensation expense, along with acquisition related and restructuring costs adjusted for the impact of taxes.
For fiscal Q3 revenue was $50 6 million.
Slightly above the midpoint of our prior guidance range down 19% to the prior quarter and down 39% year over year.
As expected the sequential decline in revenue was driven primarily by our Iot end market.
non-GAAP gross margin for fiscal Q3 was 62, 6% in line with our prior guidance range.
non-GAAP operating expense was $44 1 million down $1 9 million from the prior quarter.
And below our prior guidance range of $46 million to $49 million drip.
Driven by our continued expense management and the timing of spending between quarters.
We remain on track to our internal product development milestones.
Q3, net interest and other income was $1.
And our non-GAAP tax provision was approximately 650000.
We reported non-GAAP net loss of $11 million.
Or 28.
Loss per diluted share.
GAAP EPS was <unk> 11, better than the implied midpoint of our prior guidance range.
Driven primarily by lower operating expenses.
Now I'll turn to our balance sheet and cash flow.
Fiscal Q3, cash and marketable securities increased $5 8 million to $222 3 million.
DSO improved from 45 days in the prior quarter to 42 days.
Days of inventory improved from 147 to 145 days down $4 million from the prior quarter.
Cash from operations was $7 9 million and capital expenditures for tangible and intangible assets was $2 4 million.
Free cash flow defined as cash from operations less capex.
Was 11% of revenue for the quarter and 6% on a trailing 12 month basis.
We had three logistics and ODM companies represent 10% or more of our revenue in Q3.
WT microelectronics, a fulfillment partner in Taiwan that shifts to multiple customers in Asia came.
Came in at 54% of revenue.
She kony, an ODM, who manufactures for multiple Iot customers was 12% of revenue.
And her kudo logistics partner or primarily supplies multiple automotive customers in Japan was also 12% of revenue.
Now I'll discuss the outlook for the fourth quarter of fiscal year 2024.
The near term revenue outlook appears to be stabilizing.
While customers continue to manage our inventory levels and some pockets of end demand softness persist.
And patterns and customer feedback suggests that our revenue is leveling out.
Likely to resume growth in our next fiscal year.
For fiscal Q4, we estimate that our total revenue will be in the range of $50 million to $53 million.
With Iot up slightly and automotive about flat.
At this time, we anticipate the sequential revenue growth will continue into our fiscal Q1.
In the low to mid single digit percentage range.
We expect fiscal Q4, non-GAAP gross margin to be in the range of 62% to 63%.
We expect non-GAAP opex in the fourth quarter to be in the range of $45 million to $48 million.
With the increase compared to Q3, driven by CES marketing activities R&D tied to new product development and less favorable foreign exchange impacts.
We estimate net interest income to be approximately $1 5 million.
Our non-GAAP tax expense to be approximately 600000.
And our diluted share count to be approximately 44 million shares.
Ambarella will be participating in a fireside chat and hosting one on one group meetings on December 5th and sixth.
At NASDAQ and Morgan Stanley's wandering conference.
We also will be participating in Nomura CES, one on one conference in Las Vegas on Monday January case.
We expect to host more than 20 investor groups during our CES 2020 for exhibition from.
From January 9th to January 12.
Please contact sell side analysts to make reservations.
We will also present and host one on one and group meetings at the Needham Conference on January 17th in New York, Please contact us for more details.
Thank you for joining our call today with that I'll turn the call over to the operator for questions.
Thank you as a reminder to ask a question you will need to press star one one on your telephone to remove yourself from the question you May Press Star one again.
It will be limited to one question and one follow up please standby, while we compile the Q&A roster.
Our first question.
Our first question comes from the line of Joe Moore of Morgan Stanley.
Yes.
Great. Thank you.
But if you could talk about the adjustments Jeremy that you discussed to the funnel you had said that you've got some business kind of coming out.
I know you had a number of businesses there that were probability weighted what's happening to that when that happens.
Because the programs are just moving more slowly is it competitive.
Is it supply chain can you just kind of give us some indication of why there would be those adjustments.
Thank you Joe I think.
I'll try that question further in our in the script, we talked about 43 factors. The first factor is that forecast change your phone tier one.
Oh, Yes for example for some of the projects that we have won and the forecast of those project would reduce particularly in the last several months, we start seeing that trend. So that's the first factor. The second factor is we start seeing project delays for example for some of the project that we have won the production date is pushing out and also.
Some projects that were in the art of cure.
Face the decision of those Oh over the final decision of the award is also got pushed out so I think thats taking factor.
But also there are sort of the third factor is really that we continue to have a new project or RF killed our bidding on and we have different multiply.
Said differently.
I'll cover this level for different projects and that's a new new project would be done. The last factor is really the project that we won and lost every year. So if you ask me I think the first and second factor really negatively impact our final number by the third or fourth is the net effect in the third and fourth probably <unk>.
US to continue to add numbers into the pipe the funnel. So that's the reason we have this is a.
Minor increase on the final numbers.
Great. That's helpful. Thank you I mean, there's still an awful lot of growth over multiple years.
Five year.
Does that how does that profile look versus a year ago. I know you talked about a lot of success in China do you see more of that.
China's skewed to your numbers and then as you start to ramp the advanced CV features.
Right. So I think that first of all.
This funnel with first of all on the one portion of this the first time, we start seeing a series III contribution there in the pipeline definitely series three continue to getting higher and higher percentage of our final number.
One thing I can say that in addition to the first series three design win we announced last.
Of two times ago with County, all we add extra.
Non Chinese commercial vehicle design wins with <unk> III and the English pipeline. So we definitely continue to make progress on that and the trigger for those design win is after.
We demo the walking 685.
See me 336, 85 chip and also time or this software stack, we talk about our AI software stack that can integrate all of Chrono fusion to the.
Our radar as well as all the past planning so we.
We successfully d'amato's thing to OEM tier was those two factors help us to secure design wins of which we just talked about.
Thank you.
Our next question.
It comes from the line of sorry Swanberg of Stifel.
Yes. Good afternoon. This is Jeremy calling exploring.
I guess first just wanted to follow up a little bit more on the.
Adjustments made to the funnel can you talk about how maybe.
On a broad level how maybe.
Did did the overall market.
In terms of maybe sorry impacted and how much damage are impacted.
The slight increase in the funnel and then.
And then a follow up after that.
I think the global market definitely impacted two things one is our forecasts over the run rate over the project will be one but also I think you can see you can read a lot of article talking about for the seat for the level, two plus or level three card a lot of the new projects that decision got push out because people are having.
And thoughts about their software stack.
What is it a function features and put a particularly hard to compete with China. What was their acquired silver product planning. So I think all of those contribute to the first and second factor I just mentioned.
Great and then moving to the.
AI inference accelerator business.
That you've successfully demonstrated.
Is it a rewrite to.
Read into it that it sounds like this is something that you are moving.
Ford with and can you talk about you know maybe your competitive positioning relative to whether it's the current incumbents. The number of private companies that are in the space and maybe other large competitors that might start to move in.
Can you just talk a little bit about.
I think you are referring to the area of am So I think first of all this tie a little bit.
It's different than the last the last time, we can talk about global a lot of different applications. Because we haven't spent enough time on the marketing side at this time, we kind of zooming to say well, we understand our strengths as an H server H H devices, particularly because we were in that we are in the market and where we know a lot of customers there and we've also done enough.
Demos and also talking to customer to understand our strengths against our competitor opposed for larger companies startup companies and and our strength is first of all we have a walking silicon that we can give it time will at a very good performance very low power consumption I think that's the key the second thing is.
For us is not just a silica in fact, we also have bundled software we're going to show a development environment that we are interested we already introduced our customer well, but public introduce tour.
Yes.
How are we using our sulfur environment bundle with our current solutions that enable H device or <unk> servers quickly moving to.
Our model to help H H O cases, so I think that's where we're focusing on right now and it's not that we don't we don't want to focus on bigger cloud or hybrid.
A much bigger applications really that I think with our current so they can and our current resources, we would like to focus on areas, where we know that we were familiar with and we want to know that we can win.
That's where we are sitting on with the current plan of course that we are not giving we definitely need to build.
Roadmap about hybrid backup we said last time.
Our current commitment to M is using our current engineer resource, which is enough for to do sampling systems developing the application developing software for H applications those are.
Most applications using current your current resources.
How do we decided to extend our roadmap or doing other applications. So we probably need to talk about different engineering resource haven't commit to that yet.
Thank you.
Our next question.
Comes from the line of Christopher Rolland of Susquehanna.
Yeah.
Hey, guys. This is Matt Meyers on for Chris.
So you guys talked about first quarter potentially growing mid single digits, maybe there's a little bit slower than we were thinking about so I was curious if this is more end demand driven or inventory driven and how should we think about the inventory dynamics into the April quarter by auto or Iot with an enterprise or consumer to with them. There and then how are you thinking about the shape of end demand into the first.
And then through next fiscal year.
Well I think that the data points that we're looking at and supportive.
Growth, we talked about for fiscal Q1 is based on number one looking at our bookings and backlog trends.
Which has absolutely improved book to Bill was much better in Q3 than what we've been experiencing for a number of quarters.
And as we look at the backlog build into Q1.
It's tracking well above.
The prior quarter and is supporting the growth range that we talked about and so when we combine the data from.
From bookings and billings and we.
We compare that to the feedback that we're getting from our customers.
As well as the <unk>.
The requests that we're getting relative to push outs versus pull in of shipments which have become much more balanced than they have been in the past.
That gives us the confidence to talk about the beginning of growth in fiscal Q1, and then growth for the full fiscal 'twenty five, but certainly we have a ways to go.
So that that recovery is certainly helped by.
The turnaround of the inventory situation.
End markets also seem relatively healthy and in support of that growth, but I would say the primary driver at this point is getting to the bottom of that inventory cycle and getting through that excess material customers.
Got it thanks, Brian and then.
I also wanted to question on video processors based off of your talking about Jimmy Choo being about 60% of revenue, there's clearly a big drop off in video processor revenue this year and the C. V. T was going to continue increasing next year, what's your outlook here, particularly for video processors and are you still investing a lot in this business or getting new wins here and how should we just think about this.
Over the next year.
Right. So first of all.
I'll also point out, although we havent really tape out a video processing only chips, but video processing technology continued to be a very important part of our offering.
Our AI chip, so CV too all of CV family Chip has a big portion of the <unk> sorry, the image processing of video processing technology in there. So that's just to clarify that so the.
This year, our CV total revenue approached 60% obviously it was what I just said and also if you look at the design win momentum. We have majority of that is C. V. So I think the percentage of <unk>.
Go to a favor OCB, but however, I think the decline of our video processor will slow down because that you know we have a big job.
It's actually in the last two years, but we still have a loan payoffs over video processor chip they're selling to.
Different market, including the enterprise.
Enterprise.
Security camera as well as the automotive so I think that we should expect.
Modulus reduction on the <unk>.
PTO processor and it was a very long tail.
Yes.
Okay.
Thank you.
Our next question comes from the line.
Kevin Cassidy of Rosenblatt Securities.
Sure.
Yes, thanks for taking my question.
This quarter.
No.
The Japanese auto distributor came up as a 12% customer for the first time in a year or more.
Is there anything happening there.
Does the overall revenue was down or is there some new.
There's nothing happening.
Part of that.
Well I think it's really that if you compared with previous quarter out other business dropped quickly and the Japan automotive usually they just take at a fixed rate and it's starting to change the forecast. So it's not particularly anything happening in Japan, but it's really that outside Japan. The trop is significant.
Okay. Thanks.
Just going.
Going forward with.
Humor, and even as a consumer.
Consumer surveillance cameras and with large language models are being used.
Is there a time line.
The input for the consumer.
Number will be.
Their voice that can program the device is that something youre working with.
We are working now with just a light language or working a multi multi modality I think fact, we think that the L. R.
And for us for our customers' application. Most important thing is processing tax law also speech as well as image all of them together, that's the biggest advantage to our customer and also that that's probably one unique function that we can we can really differentiate against other area.
Yeah.
Suppliers.
Thank you.
Our next question comes from the line of Quinn Bolton of Needham <unk> Company.
Yeah.
Hey, guys. This is actually Neil young.
Brian Thanks for taking my question.
I wanted to ask so it's been about a year since you announced the partnerships.
When do you believe will start to hear about design wins from these partnerships.
Well, we only announced a design win with County, which you mentioned the name, but I think we'll get to you that you should be expanded and further I can say that our relationship with the county.
Continuing to improve and we are bidding on projects with Oems together.
In fact that you know well.
We cannot announce OEM design win with our customers approval, but one thing I can say is that the activity was county is.
As Harvey and also we continue to believe that the.
Engagement between counting on us.
Are getting tighter and tighter both on the hardware design as well as us over to you.
Okay, great. Thanks, and then just another follow up so theres been some press reports, suggesting that continental is considering divesting of some automotive assets, including its autonomous mobility business.
How would a divestiture of this business affect you guys as a partnership.
Well, yeah, we heard a similar.
The reports I think one thing I can say is based on our conversation County, we continue to believe this.
A division that we're working with is continuing to be a strategically important for both Edinburgh and also county, and like I said and with the.
The close development that we continue to have we don't see any signs of a slow slowdown on the accounting side. So we continue to believe this relationship is important and also the product working on is considered important for both amber ambarella and accounting.
Okay.
Yes.
Thank you again to ask a question. Please press star one one on your telephone again Thats Star one one to ask a question.
Our next question comes from the line.
Martin Yang of Oppenheimer <unk> company.
Hi, Thank you for taking my question.
Just one question can you maybe comment on the progress of our customer design engagements regarding your CD 72 products in automotive.
Yes C V 72 is automotive.
Automotive product is designed for Chinese market, because it's not a so so that's the only Chinese is only applicable to the Chinese market and also last time, we talk about we have multiple tier one design wins and also at that time. The last time, we talk about multiple all of the tier ones are walking.
On building a demo central show to Oems and in fact, one of our tier one just yesterday demo life in a broadcast live demo driving a car based on CB 70, <unk> pharma.
Shanghai Airport to the downtown Shanghai.
Or how much driving so I think that we continue to make huge progress and we are ready to in fact, what it stopped them wanting to Oems and <unk> and.
And also like I said before I think <unk> 72 positioning in a very.
Favorable price performance for them.
Mito and level.
Two Pos solution in China, and we continue to believe that we have a competitive solution.
That particular market and we are working closely with tier one to talk to our Oems hopefully that we can announce some devaluation.
Thank you for me a quick follow up on that signatories to activity can you maybe remind us on.
The expected timeframe of design wing and.
Shipments.
The older project, we're bidding on is production the end of 2025 and driving.
Revenue coming from 2026, so the design win has to be maybe a first half of next year and spending 18 months of development cycle to get it done.
Got it thank you.
Yes.
Thank you I would now like to turn the conference back to Dr. Fermi Wang for closing remarks, Sir.
Thank you and thank you everybody for joining us today and I'm looking forward to talk to you soon thank you.
This concludes today's conference call. Thank you for participating you may now disconnect.
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