Q2 2026 Daqo New Energy Corp Earnings Call

August 20, 2026

Speaker #1: After today's prepared remarks, there will be an opportunity to ask questions. To ask a question, please press star, then 1 on your telephone keypad.

Speaker #1: To withdraw your question, please press star, then 2. Please note this event is being recorded. I would now like to turn the conference over to Jessie Zhao, Investor Relations Director.

Speaker #1: Please go ahead.

Speaker #2: Hello, everyone. I'm Jessie Zhao, the Investor Relations Director of Daqo New Energy. Thank you for joining our conference call today. Daqo New Energy just issued its financial results for the second quarter of 2026, which can be found on our website at www.dqsolar.com.

Jessie Zhao: Hello, everyone. I am Jessie Zhao, the Investor Relations Director of Daqo New Energy. Thank you for joining our conference call today. Daqo New Energy just issued its financial results for Q2 2026, which can be found on our website at www.dqsolar.com. Today, attending the conference call we have our Chairman and CEO, Mr. Xiang Xu, our Deputy CEO, Ms. Anita Zhu, our CFO, Mr. Ming Yang, and myself. Today's call will begin with an update from Mr. Xu on market conditions and company operations, followed by a translation from Mr. Xu, and then Mr. Yang will discuss the company's financial performance for the quarter. After that, we will open the floor to Q&A from the audience.

Speaker #2: Today, attending the conference call, we have our Chairman and CEO, Mr. Xiang Xu; our Deputy CEO, Ms. Anita Zhu; our CFO, Mr. Ming Yang; and myself.

Speaker #2: Today's call will begin with an update from Mr. Xu on market conditions and company operations, followed by a translation from Mr. Xu for Mr. Xu. Then, Mr. Yang will discuss the company's financial performance for the quarter.

Speaker #2: After that, we will open the floor to Q&A from the audience. Before we begin the formal remarks, I would like to remind you that certain statements on today's call, including expected future operational and financial performance and industry growth, are forward-looking statements that are made under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995.

Jessie Zhao: Before we begin the formal remarks, I want to remind you that certain statements on today's call, including expected future operational and financial performance and industry growth, are forward-looking statements that are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement. Further information regarding this and other risks is included in the reports or documents we have filed with or furnished to the Securities and Exchange Commission. These statements only reflect our current and preliminary view as of today and may be subject to change. Our ability to achieve these projections is subject to risks and uncertainties.

Speaker #2: These statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement.

Speaker #2: Further information regarding this and other risks is included in the reports or documents we have filed with, or furnished to, the Securities and Exchange Commission.

Speaker #2: These statements only reflect our current and preliminary review as of today and may be subject to change. Our ability to achieve this projection is subject to risks and uncertainties.

Speaker #2: All information provided in today's call is as of today, and we will undertake no duty to update such information, except as required under applicable law.

Jessie Zhao: All information provided in today's call is as of today, and we undertake no duty to update such information, except as required under applicable law. Also, during the call, we will occasionally reference monetary amounts in US dollar terms. Please keep in mind that our functional currency is the Chinese RMB. We will offer these translations into US dollars solely for the convenience of the audience. Now I will turn the call to our Chairman and CEO, Mr. Xiang Xu. Mr. Xu, please go ahead.

Speaker #2: Also, during the call, we will occasionally reference monetary amounts in US dollar terms. Please keep in mind that our functional currency is the Chinese RMB.

Speaker #2: We offer these translations into US dollars solely for the convenience of the audience. Now, I will turn the call over to our Chairman and CEO, Mr. Xiang Xu.

Speaker #2: Mr. Xu, please go ahead. 现在请董事长。

Anita Zhu: Hello, everyone. This is Anita, and I will now translate our Chairman, Mr. Xu's remarks. In Q2 2026, market sentiment across the solar PV industry remained cautious amid weak domestic demand and elevated inventory levels, which drove prices lower across the solar value chain. Despite these headwinds, we resumed sales in June, delivering a sequential increase in revenue and a narrowing of our quarterly operating and net losses. Throughout this period, we continued to maintain a robust and healthy balance sheet with zero debt. As of 30 June 2026, we held a cash balance of $555.3 million, short-term investments of $250 million, bank deposits in both of $71.7 million, held-to-maturity investments of $51 million, and fixed-term bank deposit balance of $994.8 million. Together, these readily convertible assets totaled $1.9 billion, providing us with ample liquidity, confidence, and strategic flexibility to navigate the current market downturn.

Speaker #3: 今天各位投资者分析师晚上好。我是徐翔，代表新能源的CEO。感谢大家出席大学新能源2026年二季度的一起交流会。因为时间的关系，我就想请Anita把我今天的这个报告的一些内容翻译一下，直接讲英文，时间的关系。

Speaker #2: Hello everyone. This is Anita, and I'll now translate our Chairman, Mr. Xu's remarks. In the second quarter of 2026, market sentiment across the authority industries remained cautious amid weak domestic demand and elevated unemployment levels.

Speaker #2: Which drove prices lower across the solar value chain. Despite these headwinds, we resumed sales in June, delivering a sequential increase in revenue and a narrowing of quarterly operating and net losses.

Speaker #2: Throughout this period, we continued to maintain a robust and healthy balance sheet with zero debt. As of June 30, 2026, we held a cash balance of $555.3 million, short-term investments of $250 million, bank deposits of $71.7 million, healthy maturity investments of $51 million, and a fixed-term bank deposit balance of $994.8 million.

Speaker #2: Together, these readily convertible assets totaled $1.9 billion, providing us with ample liquidity, confidence, and strategic flexibility to navigate the current market downturn.

Speaker #2: On the operational front, we continue to take proactive measures to navigate challenging market conditions, with our nameplate capacity utilization rate operating at approximately 57% during the period.

Anita Zhu: On the operational front, we continued to take proactive measures to navigate challenging market conditions with our namesake capacity utilization rate operating at approximately 57% during the period. Total production volume at our two polysilicon facilities was 43,675 metric ton for the quarter, exceeding our guidance range of 35,000 metric ton to 40,000 metric ton. With polysilicon market prices remaining below production costs since Q1 2026. We initially refrained from engaging in below-cost sales in line with Chinese self-regulation guidelines and adopted a disciplined wait-and-see approach pending further implementation of the national anti-involution policies. However, after an extended period without clear policy updates, we adjusted our sales and pricing strategies toward a more market-oriented approach in June. As a result, our sales volume increased from 4,482 metric ton last quarter to 15,190 metric ton, with average selling price falling to $4.04 for kilowatt hour.

Speaker #2: Total production volume at our two hospital facilities was 43,675 metric tons for the quarter, exceeding our guidance range of 35,000 to 40,000 metric tons.

Speaker #2: With policy-driven market prices remaining below production costs since the first quarter of 2026, we initially refrained from engaging in below-cost sales in line with Chinese self-regulation guidelines, and adopted a disciplined, wait-and-see approach pending further implementation of the national anti-inflation policies.

Speaker #2: However, after an extended period without clear policy updates, we adjusted our sales and pricing strategies toward a more market-oriented approach in June. As a result, our sales volume increased from 4,482 metric tons last quarter to 15,190 metric tons, with average selling price falling to $4.04 per kilogram.

Speaker #2: Our policy and transaction and shipment volumes have continued to pick up in the third quarter, reflecting increased confidence in the quality and an ongoing preference for our products from customers.

Anita Zhu: Our polysilicon transaction and shipment volumes have continued to pick up in Q3, reflecting increased confidence in the quality and an ongoing preference for product from customers. On the cost side, solar production costs remained flat sequentially at USD 5.95 per kilogram, with cash costs edging down by 0.4% to USD 4.57 per kilogram, and manufacturing costs in RMB terms declining slightly. In light of the current market dynamics, we expect total polysilicon production volume Q3 2026 to be approximately 40,000 metric tons to 45,000 metric tons. For the full year of 2026, we expect production volume to be in the range of 160,000 metric tons to 180,000 metric tons.

Speaker #2: On the cost side, total production costs remained flat sequentially at $5.95 per kilogram, with cash costs edging down by 0.4% to $4.57 per kilogram.

Speaker #2: In manufacturing costs, the R&D terms are declining slightly. In light of the current market dynamics, we expect total polysilicon production volume for the third quarter of 2026 to be approximately 40,000 metric tons to 45,000 metric tons.

Speaker #2: For the full year of 2026, we expect production volume to be in the range of 160,000 metric tons to 180,000 metric tons. Polysilicon market prices came under further downward pressure during the second quarter, which resulted in polysilicon prices falling from 35 to 37 RMB per kilogram at the end of the first quarter to 31 to 34 RMB per kilogram at the end of the second quarter.

Anita Zhu: Polysilicon market prices came under further downward pressure during Q2, with untied polysilicon prices falling from 35 to 37 RMB per kilogram at the end of Q1 to 31 to 34 RMB per kilogram at the end of Q2. Amid subdued demand, depressed pricing, and accumulating industry-wide inventories, polysilicon producers operated at low utilization rates, with aggregate output of 5,308 thousand metric tons in H1 2026, representing a 9.8% year-on-year decrease. As we make our way through Q3, the continued rollout of anti-pollution measures is gaining momentum. In July, a series of mandatory national standards were issued for energy consumption and product efficiency across the solar PV value chain, including the final official version of a new standard setting energy consumption limits per unit of polysilicon output, which will take effect on 1 January 2027.

Speaker #2: Amidst the huge demand, the price pricing and accumulating industry-wide inventories policy, comp producer operated at low utilization rates, with aggregate output of 5,308,000 metric tons in the first half of 2026.

Speaker #2: Representing a 9.8% year-on-year increase, a decrease. As we make our way through the third quarter, we continue to roll out anti-inflation measures and are gaining momentum.

Speaker #2: In July, a series of mandatory national standards were issued for energy consumption and product efficiency across the solar peak value chain, including the final official version of a new standard setting energy consumption limits per unit of polysilicon output, which will take effect on January 1, 2027.

Speaker #2: Policy-comp manufacturers whose unit energy consumption exceeds 6.3 kilograms per kilogram must complete a corrective improvement by that date, or face the risk of plant shutdown.

Anita Zhu: Polysilicon manufacturers whose unit energy consumption exceeds 6.3 kilograms of SCE per kilogram must complete a corrective improvement by that date or face the risk of plant shutdown. Notably, the threshold of 6.3 per kilogram is stricter than the 6.4 proposed in the draft, signaling regulators' commitment to accelerating the phase-out of inefficient capacity. On 27 July, the China Photovoltaic Industry Association issued the General Principles for Cost Accounting Models in the Photovoltaic Industry, an initiative to regulate market competition and advance standardized industry governance to lay the foundation for price regulation enforcement. On 31 July, the State Administration for Market Regulation issued price compliance guidance for the solar PV sector, promoting a structural shift from price competition to value-driven differentiation.

Speaker #2: Notably, this threshold of 6.3 per kilogram is stricter than the 6.4 proposed in the draft, signaling regulators' commitment to accelerating the phase-out of inefficient capacity.

Speaker #2: On July 27, the China Photovoltaic Industry Association issued the general principles for cost accounting models in the photovoltaic industry, an initiative to regulate market competition and advance standardized industry governance that lays the foundation for price regulation enforcement.

Speaker #2: On July 31, the State Administration for Market Regulation issued price compliance guidelines for the solar PV sector, promoting a structural shift from price competition to value-driven differentiation.

Speaker #2: The SAMR emphasized that solar PV companies must conduct price compliance self-reviews and curb irrational low-price competition, and that a CPI shift in industry self-regulation promotes a general principle and guides companies away from illegal pricing practices such as below-cost dumping.

Anita Zhu: The SAMR emphasized that solar PV companies must conduct price compliance self-reviews and curb irrational low-price competition, and that the CPIA should strengthen industry self-regulation, promote the general principles, and guide companies away from illegal pricing practices such as below-cost selling. The SAMR also indicated that it will take enforcement action against non-compliant entities. Together with seven other polysilicon manufacturers, we jointly signed an initiative to eliminate below-cost sales and fully comply with energy consumption standards on 6 August. As a result of these selective measures, polysilicon prices are beginning to show signs of recovery, with spot prices stabilizing and forward prices rebounding by more than 10% from their recent lows. We are also diversifying beyond our core polysilicon business to hedge against solar PV cyclicality, targeting the fast-growing AI data center power infrastructure market.

Speaker #2: The SAMR also indicated that it will take enforcement action against noncompliant entities. Together with seven other polysilicon manufacturers, we jointly signed an initiative to eliminate below-cost sales and fully comply with energy consumption standards on August 6.

Speaker #2: As a result of these collective measures, policy comp prices are beginning to show signs of recovery, with stock prices stabilizing and forward prices rebounding by more than 10% from their recent lows.

Speaker #2: We're also diversifying beyond our core polysilicon business to hedge against solar PV cyclicality, targeting the fast-growing AI data center power infrastructure market.

Speaker #2: On June 3, 2026, we announced the signing of an investment agreement to establish a manufacturing base focused on the R&D, manufacturing, and sale of next-generation energy solutions and related equipment for AIDC.

Anita Zhu: On 3 June 2026, we announced the signing of an investment agreement to establish a manufacturing base focused on the R&D, manufacturing, and sale of next-generation energy solutions and related equipment for AIDC. This includes energy storage systems, solid-state transformers, and solid-state circuit breakers. These technologies support the industry's transition to high-voltage direct current architecture, such as the 800 volt DC standard advanced by NVIDIA and other leading AI infrastructure providers. The platform is anchored by Daqo Group, our affiliated entity under common beneficial ownership with Daqo New Energy, which brings over 40 years of power equipment manufacturing expertise, established technology, deep talent, and customer relationships to accelerate our entry into the segment. We view AIDC power infrastructure as a structural growth opportunity that complements our core business and broadens our earnings base.

Speaker #2: This includes energy storage systems, solid-state transformers, and solid-state circuit breakers. These technologies support the industry transition to high-voltage direct current architecture, such as the 800-volt PV standard advanced by NVIDIA and other leading AI infrastructure providers.

Speaker #2: The platform is anchored by DAQO Group, our affiliated entity under common beneficial ownership with DAQO New Energy, which brings over 40 years of power equipment manufacturing expertise, established technology, and deep talent in customer relationships to accelerate our entry into the segment.

Speaker #2: We view AIDC power infrastructure as a structural growth opportunity that complements our core business and broadens our earnings base. Consistent with our strong track record, having navigated several policy comp cycles, we intend to pursue this extension in a disciplined manner that preserves our balance sheet strength.

Anita Zhu: Consistent with our strong track record, having navigated several polysilicon cycles, we intend to pursue this expansion in a disciplined manner that preserves our balance sheet strength. Despite a challenging environment, the solar PV industry continues to exhibit compelling long-term growth prospects. Growing vulnerabilities in global energy markets have sparked widespread concerns about national energy security, in which the solar PV and renewable energy sectors can play a crucial role. As one of the world's lowest-cost producers of the highest quality N-type polysilicon, backed by a robust balance sheet and zero debt, we remain optimistic about the sector and are well-positioned to capitalize on anticipated market recovery and long-term growth opportunities. We will continue to strengthen our competitive edge through advancements in high-efficiency N-type technology and cost optimization via digital transformation and AI adoption.

Speaker #2: Despite the challenging environment, the solar PV industry continues to exhibit compelling long-term growth prospects. Growing vulnerabilities in global energy markets have sparked widespread concerns about national energy security, in which the solar PV and renewable energy sectors can play a crucial role.

Speaker #2: As one of the world’s lowest-cost producers, at the highest quality, intact policy comp, backed by a robust balance sheet and zero debt, we remain optimistic about the sector and are well-positioned to capitalize on the anticipated market recovery and long-term growth opportunities.

Speaker #2: We'll continue to strengthen our competitive edge through advancements in high-efficiency intact technology and cost optimization via digital transformation and AI adoption. As the world accelerates its transition between energy sources, we're confident in our ability to play a leading role in shaping that future.

Anita Zhu: As the world accelerates its transition to clean energy, we are confident in our ability to play a leading role in shaping that future. Now I will turn the call to our CFO, Mr. Ming Yang, who will discuss the company's financial performance for the quarter. Ming, please go ahead.

Speaker #2: And now I'll turn the call over to our CFO, Mr. Ming Yang, who will discuss the company's financial performance for the quarter. Ming, please go ahead.

Speaker #3: Thank you, Anita, and hello everyone. This is Ming Yang, CFO of Daqo New Energy. We appreciate you joining our earnings conference call today. I will now go over the company's second quarter 2026 financial performance.

Ming Yang: Thank you, Anita, and hello, everyone. This is Ming Yang, CFO of Daqo New Energy. We appreciate you joining on our new conference call today. I will now go over the company's Q2 2026 financial performance. Revenues were $62.7 million compared to $26.7 million in Q1 2026 and $75 million in Q2 2025. The increase in revenue compared to Q1 2026 was primarily driven by higher sales volume. The company resumed normal sales activities starting in June, following a prolonged period with no new policy developments. Gross loss was $82.7 million compared to $139 million in Q1 2026 and $81.4 million in Q2 2025. Gross margin was -132% compared to -520% in Q1 2026 and -108% in Q2 2025.

Speaker #3: Revenues were $62.7 million, compared to $26.7 million in the first quarter of 2026 and $75 million in the second quarter of 2025. The increase in revenue compared to the first quarter of 2026 was primarily driven by higher sales volume, as the company resumed normal sales activity starting in June following a prolonged period with no new policy developments.

Speaker #3: Gross loss was $82.7 million, compared to $139 million in the first quarter of 2026, and $81.4 million in the second quarter of 2025. Gross margin was negative 132%, compared to negative 520% in the first quarter of 2026, and negative 108% in the second quarter of 2025.

Speaker #3: The sequential improvement in gross margin was primarily due to a decrease in provisions for inventory impairment, which was $55.7 million in the second quarter of 2026, compared to $98.9 million in the first quarter of 2026.

Ming Yang: The sequential improvement in group gross margin was primarily due to a decrease in provisions for inventory impairments, which was $55.7 million in Q2 2026 compared to $98.9 million in Q1 2026. The SG&A expenses were $15.8 million compared to $12.2 million in Q1 2026 and $32 million in Q2 2025. The sequential increase was primarily due to higher sales volume in Q2 2026. The year-over-year decrease was also due to the companies recognizing $18.6 million in non-cash share-based compensation costs related to its share incentive plan in Q2 2025. R&D expenses were $1.6 million compared to $0.8 million in Q1 2026 and $0.8 million in Q2 2025. The increase is primarily due to R&D of next-generation energy solutions for AIDC power infrastructure.

Speaker #3: The C&A expenses were $15.8 million, compared to $12.2 million in the first quarter of 2026, and $32 million in the second quarter of 2025.

Speaker #3: The sequential increase was primarily due to higher sales volume in the second quarter of 2026. The year-over-year decrease was also due to the company recognizing $18.6 million in non-cash share-based compensation costs related to its Sharing Census Plan in the second quarter of 2025.

Speaker #3: R&D expenses were $1.6 million, compared to $0.8 million in the first quarter of 2026 and $0.8 million in the second quarter of 2025. The increase is primarily due to R&D of next-generation energy solutions for AIDC power infrastructure.

Speaker #3: R&D expenses can vary from period to period and reflect R&D activities that take place during the quarter. Loss on operations was $98 million, compared to $150.8 million in the first quarter of 2026 and $115 million in the second quarter of 2025.

Ming Yang: R&D expenses can vary from period to period and reflect R&D activities that take place during the quarter. Loss from operations was $98 million compared to $160.8 million in Q1 2026 and $115 million in Q2 2025. Operating margin was -156% compared to -560% in Q1 2026 and -152% in Q2 2025. Net loss attributable to Daqo New Energy Corp. shareholders was $81 million compared to $88 million in Q1 2026 and $76.5 million in Q2 2025. Loss per basic ADS was $1.20 compared to $1.31 in Q1 2026 and $1.14 in Q2 2025.

Speaker #3: Operating margin was negative 156%, compared to negative 560% in the first quarter of 2026 and negative 152% in the second quarter of 2025. Net loss attributable to Daqo New Energy Corp. shareholders was $81 million, compared to $88 million in the first quarter of 2026 and $76.5 million in the second quarter of 2025.

Speaker #3: Loss per basic ADS was $1.20, compared to $1.31 in the first quarter of 2026, and $1.14 in the second quarter of 2025. Adjusted net loss attributable to Daqo New Energy shareholders, excluding non-cash share-based compensation costs, was $81 million, compared to $88.4 million in the first quarter of 2026, and $67.9 million in the second quarter of 2025.

Ming Yang: Adjusted net loss attributable to Daqo New Energy shareholders, excluding non-cash share-based compensation cost, was $81 million compared to $88.4 million in Q1 2026 and $67.9 million in Q2 2025. Adjusted loss per basic ADS was $1.20 compared to $1.31 in Q1 2026 and $0.86 in Q2 2025. EBITDA was -$29 million compared to -$83 million in Q1 2026 and -$48 million in Q2 2025. EBITDA margin was -46.8% compared to -311% in Q1 2026 and -64% in Q2 2025. Now on the company's financial condition. As of 30 June 2026, the company had $555 million in cash and cash equivalents compared to $559.4 million as of 31 March 2026 and $598.6 million as of 30 June 2025.

Speaker #3: Adjusted loss per basic ADS was $1.20 compared to $1.31 in the first quarter of 2026 and $0.86 in the second quarter of 2025. EBITDA was negative $29 million compared to negative $83 million in the first quarter of 2026 and negative $48 million in the second quarter of 2025.

Speaker #3: EBITDA margin was negative 46.8% compared to negative 311% in the first quarter of 2026, and negative 64% in the second quarter of 2025. Now, on the company's financial condition.

Speaker #3: As of June 30, 2026, the company had $555 million in cash and cash equivalents, compared to $559.4 million as of March 31, 2026, and $598.6 million as of June 30, 2025.

Speaker #3: And as of June 30, 2026, short-term investment was $215 million, compared to $288 million as of March 31, 2026, and $418 million as of June 30, 2025.

Ming Yang: As of 30 June 2026, short-term investment was $215 million compared to $288 million as of 31 March 2026 and $118 million as of 30 June 2020. As of 30 June 2026, note receivable balance was $71.7 million compared to $20.8 million as of 31 March 2026 and $49 million as of 30 June 2025. Note receivable balance, which represent bank notes with maturity within six months. As of 30 June 2026, held-to-maturity investment was $51 million compared to $50.3 million as of 31 March 2026, and zero as of 30 June 2025. As of 30 June 2026, the balance of fixed term deposits within one year was $928.9 million compared to $1 billion as of 31 March 2026, and $960.7 million as of 30 June 2025. Now on the company's cash flows.

Speaker #3: As of June 30, 2026, our receivable balance was $71.7 million, compared to $20.8 million as of March 31, 2026, and $49.0 million as of June 30, 2025.

Speaker #3: No receivable balance, which represents bank notes with maturity within six months. As of June 30, 2026, held-to-maturity investment was $51 million, compared to $50.3 million as of March 31, 2026, and $0 as of June 30, 2025.

Speaker #3: And as of June 30, 2026, the balance of fixed-term deposits within one year was $928.9 million, compared to $1 billion as of March 31, 2026, and $960.7 million as of June 30, 2025.

Speaker #3: Now, on the company's cash flows: For the six months ended June 30, 2026, net cash used in operating activities was $276 million, compared to $105 million in the same period of 2025.

Ming Yang: For the six months ended 30 June 2026, net cash used in operating activities was $276 million compared to $105 million in the same period of 2025. For the six months ended 30 June 2026, net cash used in investing activities was $159.6 million compared to $242.7 million in the same period of 2025. Net cash used in investing activities in 2026 was primarily related to the purchase of short-term investments and fixed-term deposits. For the six months ended 30 June 2026, net cash used in financing activities was $7.8 million compared to $32,000 in the same period of 2025. Net cash used in financing activities in 2026 was primarily related to $7.8 million in stock purchases made by the company's subsidiary, Xinjiang Daqo, from its minority shareholders. That concludes our prepared remarks. We will now open the call to Q&A from the audience. Operator, please begin.

Speaker #3: And for the six months ended June 30, 2026, net cash used in investing activities was $159.6 million, compared to $342.7 million in the same period of 2025.

Speaker #3: Net cash used in investing activities in 2026 was primarily related to the purchase of short-term investments and fixed-term deposits. For the six months ended June 30, 2026, net cash used in financing activities was $7.8 million, compared to $32,000 in the same period of 2025.

Speaker #3: Net cash used in financing activities in 2026 was primarily related to $7.8 million in stock purchases made by the Company's subsidiary, Xinjiang Daqo, from its minority shareholders.

Speaker #3: And that concludes our prepared remarks. We will now open the call to Q&A from the audience. Operator, please begin.

Operator 2: We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Our first question comes from Philip Shen with ROTH Capital Partners. Please go ahead.

Operator: We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Our first question comes from Philip Shen with ROTH Capital Partners. Please go ahead.

Speaker #1: We will now begin the question-and-answer session. To ask a question, you may press star then 1 on your telephone keypad. If you are using the speakerphone, please pick up your handset before pressing the keys.

Speaker #1: To withdraw your question, please press star, then 2. At this time, we will pause momentarily to assemble our roster. Our first question comes from Philip Chen with Rock Capital Partners.

Speaker #1: Please go ahead.

Speaker #2: Hi, this is Oscar Cham on for Phil. Can you hear me okay?

Oscar Chen: Hi, this is Oscar Chen on for Phil. Can you hear me okay?

Speaker #4: Yes. You're loud and clear.

Ming Yang: Yes, you are loud and clear.

Speaker #2: Okay, I have two questions. My first question is on government support for poly pricing. Even with the recent 10% rebound in forward prices, poly ASP has remained below industry production costs since late Q1.

Oscar Chen: Okay. I have two questions. First question is on government support on polysilicon pricing. Even with the recent 10% rebound in forward prices, polysilicon ASP remained below industry production costs since late Q1. How would you characterize the central government stance on supply rationalization? Are you anticipating any incremental regulatory support that could help establish a sustainable price floor in the near term? I have a follow-up.

Speaker #2: How would you characterize the central government's stance on supply rationalization? Are you anticipating any incremental regulatory support that could help establish a sustainable price floor in the near term?

Speaker #2: And then I have a follow-up.

Speaker #4: Okay, we're going to translate your question in a minute.

Ming Yang: Okay. We're going to translate your question. I will translate for our CEO, Mr. Shi. On 6 August, led by the China Photovoltaic Industry Association, there is a strong initiative for self-discipline. Based on the CPIA cost model, the industry average production cost is estimated to be around CNY 50,000 per ton, about CNY 50 per kilogram. Due to the current market environment where demand activity is relatively low, there's still approximately 500,000 to 600,000 tons of polysilicon inventory in the industry, so we think this price recovery might take a little bit longer than anticipated. There is strong consensus within the industry for self-discipline and also with the urging of the government and the related departments that the consensus is that it's no longer viable to sell below cost.

Ming Yang: Okay. We're going to translate your question.

Speaker #3: Okay, I will translate for our CEO, Mr. Xiang Xu. On August 6th, led by the China Photovoltaic Industry Association, there is a strong initiative for self-discipline.

Ming Yang: I will translate for our CEO, Mr. Shi. On 6 August, led by the China Photovoltaic Industry Association, there is a strong initiative for self-discipline. Based on the CPIA cost model, the industry average production cost is estimated to be around CNY 50,000 per ton, about CNY 50 per kilogram. Due to the current market environment where demand activity is relatively low, there's still approximately 500,000 to 600,000 tons of polysilicon inventory in the industry, so we think this price recovery might take a little bit longer than anticipated. There is strong consensus within the industry for self-discipline and also with the urging of the government and the related departments that the consensus is that it's no longer viable to sell below cost.

Speaker #3: And based on the CPIA cost model, the industry average cost is estimated to be around 50,000 RMB per ton. So, about 50 RMB per kilogram.

Speaker #3: Per kilogram. But due to the current market environment, where demand activity is relatively low and there's still approximately 500,000 to 600,000 tons of poly inventory in the industry, we think the price recovery might take a little bit longer.

Speaker #3: The anticipated, but there is strong consensus within the industry for self-discipline, and also with the urging of the government and the related departments, the industry consensus is that it's no longer viable to sell below cost.

Speaker #3: And what we're seeing in the market is that the quotations for polysilicon pricing from different manufacturers have already exceeded about 40 RMB per kilogram.

Ming Yang: What we're seeing in the market is that the quotations for polysilicon pricing from different manufacturers have already exceeded about CNY 40 per kilogram. We're optimistic about the current policy development, and we're waiting to see how the policies may be enforced going forward.

Speaker #3: So, we're optimistic about the current policy developments, and we're waiting to see how the policies may be enforced going forward.

Speaker #4: Will Germany advance or may advance? 大家都处于一种观望的状态。我们的卖方正在报一个合理的价钱，不能亏损的价格。买方还在观察，还在观察，也在一个博弈的过程当中。但我个人认为，反对者基于成本价的销售应该讲是不合规，可能也是一种倾销的行为，也是应该被制止的。所以这当中就是我们需要在法律框架之内合理、合法、合规的方式之下进行一些反对者的工作。但是我想这个应该会有效果，因为近几年所有的中国的光伏企业都因为企业都在亏损大量的现金流。我想这种长时间的亏损是没有是没有任何的商业模式是不允许的。所以我想这个这个局面我想时间不会太长，应该会扭转。其实大家去年的12月份的时候，反对者的第一步的时候，我们大权的现金流是不亏现金流的。去年的最后一个季度，2025年季度，我想这个动作可能会这个行动可能会影响到后续会影响到我们都进入的价钱。

Xiang Xu: 其实大家在去年12月份反内卷第一步的时候，我们大全现金流是不亏现金的。去年是积极的，2022我们知道。我想这个动作，这个行动可能会影响到后续，会影响到我们的价值。

Speaker #3: Okay, so let me translate for Mr. Xi. Right now, in terms of the value chain within the industry, between the buyers and sellers of polysilicon, some of the buyers are still observing the market and policy developments.

Ming Yang: Okay. Let me translate for Mr. Xu. Right now, the industry in terms of the value chain between the buyers and sellers of polysilicon.

Ming Yang: Some of the buyers are still observing the market and the policy development, and they are taking a wait-and-see approach. But in terms of the polysilicon manufacturers, they are expecting a reasonable price where they would not be selling at a loss or below their cost. There is still some, you can call it a wait-and-see between the polysilicon manufacturers and the downstream. But we do believe that the past industry practice of selling below cost, especially in the first 6 months of this year, is likely to end, and where the government is very adamant about preventing dumping of the products and selling below cost. Within the law framework for price laws and for the anti-involution, our expectation is that this is likely to move forward optimistically over the next several months. We know that over the past few years, the polysilicon manufacturers or the whole industry in general have seen significant losses, and we do not think that this is long-term sustainable. In fact, it is very unsustainable, and this is likely to lead the industry in trouble. If we look at DQ, especially in December of last year, when the anti-involution policy was more successful, right?

Speaker #3: And they're taking a wait-and-see approach. But in terms of the polysilicon manufacturers, they are expecting a reasonable price where they would not be selling at a loss or below their cost.

Speaker #3: So there's still some, you can call it, a wait-and-see between the polysilicon manufacturers and the downstream. But we do believe that the past industry practice of selling below cost, especially in the first six months of this year, is likely to end.

Speaker #3: And where the government is very adamant about preventing dumping of the products and selling below cost, so within the law framework for price law and for the anti-involution, expectation is that this is likely to move forward optimistically over the next several months.

Speaker #3: And then we know that, over the past few years, the polysilicon manufacturers, or the whole industry in general, have seen significant losses, and we do not think that this is long-term.

Ming Yang: We know that over the past few years, the polysilicon manufacturers or the whole industry in general have seen significant losses, and we do not think that this is long-term sustainable. In fact, it is very unsustainable, and this is likely to lead the industry in trouble. If we look at DQ, especially in December of last year, when the anti-involution policy was more successful, right?

Speaker #3: Sustainable. In fact, it's very unsustainable, and this is likely to lead to trouble for the industry. So, if we look at DQ, especially in December of last year when the anti-involution policy was more successful, right?

Speaker #3: So in Q4, DQ had no cash loss. So we were able to achieve a positive operating cash flow during that.

Ming Yang: DQ had no cash loss in Q4 of 2025. We were able to achieve a positive operating cash flow during that period. We think that is a more sustainable timing of framework going forward.

Speaker #3: So, we think that that's a more sustainable timing or framework going forward.

Speaker #2: Thank you for the color, Mr. Xi and Mr. Yang. Just my second question is on the self-discipline agreement side signed in August. Previous rounds of self-regulation kind of struggled to maintain compliance once prices fluctuated.

Oscar Chen: Thank you for the color, Mr. Xu and Mr. Yang. My second question is on the self-discipline agreement signed in August. Previous rounds of self-regulation kind of struggle to maintain compliance once prices fluctuated. Just wondering what makes this framework structurally distinct from past attempts? Regarding the energy consumption requirements, what is your estimate of total industry capacity that could be phased out?

Speaker #2: Just wondering, what makes this framework structurally distinct from past attempts? And then, regarding the energy consumption requirements, what is your estimate of total industry capacity that could be phased out?

Speaker #1: Our next question comes from Alan Liu with Jefferies. Please go ahead.

Operator 2: Our next question comes from Alan Lau with Jefferies. Please go ahead.

Operator: Our next question comes from Alan Lau with Jefferies. Please go ahead.

Speaker #3: Louis, we're still answering. Fantastic. Hold on, hold on. Okay, just give us a minute.

Ming Yang: We were still answering, not translating. Hold on. Okay. Just give us a minute.

Speaker #1: All right. We have Philip Chen back on the podium. My apologies.

Operator 2: All right. We have Philip Shen back on the podium. My apologies.

Operator: All right. We have Philip Shen back on the podium. My apologies.

Speaker #4: Yeah. This is what I'm mentioning. You对者是想通过成立一个基金，成立一个公司收购的形式，对吧？这个可能跟中国的市场监管局的反垄断是有冲突的。从法律上说是有冲突的。应该讲涉及的不是太合理。但这一次是大家在制定的基础之上，对吧？还有一个是根据各家公司的自身的情况，比如大权，我们做过现金流，我们做开我们在这个当中我们生产制造的成本，我们的技术的优势就很明显。我们就能往下走。有些企业自身的技术的原因，能耗高，它也不会让能耗的标准不达标，对吧？现金流也不够，所以这些就慢慢会按照市场的规矩会淘汰。所以这次讲的是说根据成本的就是说根据这个成本价，大家都抱着成本来说，如果低于成本，我想还有各种配套的措施，所以来说一般的企业就很难能够活得下来，很难能够活得下来。因为这次还是有一些就是应该讲在这个法律的框架之下能够走得更远。

Xiang Xu: 对，这就是为什么。

Ming Yang: Right.

Xiang Xu: 因为这次是这样的。

Ming Yang: Mm-hmm.

Xiang Xu: 上一次的这个反内卷是想通过成立一个基金、成立一个公司收购的形式，对吧？这个可能跟中国的市场监管局的这个反垄断是有冲突的，从法律上这种冲突，应该讲设计得不是太合理。但这一次是大家在自律的基础之上，对吧？还有一个是根据各家公司的自身的情况，比如大全，我们这个现金流，我们做开，我们在这个当中，我们生产制造的成本，我们技术的优势就很明显，我们就能往下走。有些企业自身的技术的原因，能耗高，它也不会那么能耗的标准不达标，对吧？现金流也不够，所以这些企业慢慢会按照市场的规矩去做。所以这次来讲就是说就不计成本，就是说不计这个成本价，大家都抱着成本来说，如果不计成本，我想还有各种配套的措施，所以来说一般的企业就很难能够活得下来，因为这次还是有一些，应该讲在这个法律的这个框架之下能够走得更远。

Speaker #3: Okay, now let me translate for Mr. Xi. We believe that the current round of anti-involution policy, along with price law enforcement, is likely to be sustained.

Ming Yang: Okay. Now let me translate for Mr. Xu. Okay. We believe that the current round of anti-involution policy and with the price law enforcement is likely to sustain. Well, what we saw in the previous round was that there was this proposal for the industry consolidation platform to accelerate the exit of excess capacity. But the State Administration for Market Regulation stepped in because they were very worried about anti-monopoly practices between the leading manufacturers. So they were worried that this would bring non-market activities or behaviors by the main manufacturers. But this time, the current effort is led by the State Administration for Market Regulation, and this is bringing self-discipline forward. Also, there is no coordination between the manufacturers on pricing or allocation of cell volume, for example.

Speaker #3: We saw in the previous round that there was this proposal for the industry consolidation platform, right, to accelerate the exit of capacity.

Speaker #3: But the state administration for market regulation stepped in because they were very worried about anti-monopoly practices between the manufacturers. The leading manufacturers. So they were worried that this would bring non-market activities or behaviors by the main manufacturers.

Speaker #3: But this time, the current effort is led by the state administration for market regulations. And this is bringing self-discipline forward and also this is not, for example, there's no coordination between the manufacturers on pricing or allocating of sales volume, for example, right?

Speaker #3: So this time it's really based on each individual manufacturer's their own cost, production cost, right, and in terms of their manufacturing efficiencies. And for them to sell products based on their ability to produce products at a lower cost.

Ming Yang: So this time it is really based on each individual manufacturer's own production costs, and in terms of their manufacturing efficiencies, and for them to sell products based on their ability to produce product at a lower cost. Okay, so we think that this time it is actually much more sustainable and is being supported by the government. So we think that through these two efforts, one is by being one of the lower cost producers within the industry, as well as with the regulations on energy usage. We think that this time it will promote a more market-oriented approach to both capacity exits and to the selling of products at reasonable price. And this is all under the current legal framework brought forward by the government. Hello?

Speaker #3: Okay. So we think that this time it's actually much more sustainable and is being supported by the government. So we think that through these two efforts, right, one is by being one of the lowest-cost producers.

Speaker #3: Within the industry, as well as with the regulations on energy usage, we think that this time it will promote a more market-oriented approach to both capacity exits and to the selling of products at reasonable prices.

Speaker #3: And this is all under the current legal framework brought forward by the government. Hello?

Speaker #2: Yeah, that's all my questions. Thank you. Thank you, Yang.

Oscar Chen: That's all my questions. Thank you. Thank you again.

Ming Yang: Good. Thank you.

Speaker #3: Thank you, Oscar. Thank you.

Speaker #1: Our next question comes from Alan Liu with Jefferies. Please go ahead.

Operator 2: Our next question comes from Alan Lau with Jefferies. Please go ahead.

Operator: Our next question comes from Alan Lau with Jefferies. Please go ahead.

Alan Lau: Thanks management for taking my question. My first question is a follow-up on the overall initiative to avoid selling below cost. My understanding is that current inventory in the industry is at quite a high level, and the end demand is also quite weak at the same time. When would you expect the polysilicon price, for example, you mentioned their price quotes at above CNY 40 per kilogram. Given that their inventory at the wafer players and demand isn't that strong, when would you expect the first batch of transaction at a higher price to happen? In the past two weeks, all the data has halted. I'd like to know when we would expect the real transaction is coming out.

Speaker #2: Thank you, management, for taking my question. My first question is a follow-up regarding the overall initiative to avoid selling below cost. My understanding is that current inventory in the industry is at a rather high level.

Speaker #2: And the end demand is also quite weak at the same time. So when would you expect the quality price—for example, you mentioned their price quote at above RMB 40 per kilogram.

Speaker #2: But given that their inventory at the wafer players and demand isn't that strong, when would you expect the first batch of transactions at a higher price to happen?

Speaker #2: Because in the past two weeks, all the data have halted. So we'd like to know when you would expect the real transaction to come out.

Speaker #4: Okay. Let me translate

Ming Yang: Okay. Let me translate for Mr. Shi.

Speaker #3: For Mr. Xi. Give us a minute. Okay.

Alan Lau: Yes, thank you.

Ming Yang: Give us a minute.

Xiang Xu: Today in the market, they told me that there were fewer transactions, about 40,000, fewer transactions. Because there is still demand. Although demand is relatively weak, there are still many companies, our downstream companies, that are short of shares. In the context of being short of shares, they have no shares, so they just buy as many as they can. This is the production demand. There is also this transaction. As far as I know, the information is that there have been transactions of more than 40,000. I think this transaction of more than 400,000 is still a gap between our cash cost of $50,000 and everyone's. I think this is a trial balloon.

Speaker #4: So今天我的市场上他们告诉我有少量的去成交，大概在4万左右，有少量的成交。因为这个还是有需求的。虽然需求比较疲软，但是还有些很多公司，我们的下游企业是零库存的管理。零库存的管理当中它没有库存，它就会少量去购买。这样子生产需求就在。就是已经有超过听说了解的信息是有，我们了解的信息已经超过4万以上的成交。所以我想但是4万以上的成交和当时的我们大家的现金成本5万块钱还有一定的差距。我想这次在试探，但是我认为我们讲的是根据现金成本的成交，不是基于成本成交倾销行为，也是一个违法的行为。所以价格法当中我是不合理的。不合理。所以我想这个局面会进一步的应该是加快。我自己认为是加快，但是现在已经有成交。从上次开始一直到博弈大概有两个星期几乎没有成交。现在已经有少量的成交。我想这个事情会我认为可能会加快。这次基于是什么？大家要信任我们的应该讲大家要信任我们的承诺，对吧？因为我们大家都在一个承诺，我们自己成本加销售要行业之力。但是配到反内卷的国家一些措施，我想这个可能速度越来越快。

Xiang Xu: But I think what we are talking about is not a transaction below the cash cost, which is not only an illegal transaction in terms of cost, but also an illegal transaction in terms of law. It is irrational. I think this situation will gradually increase. I personally think it will increase. But now there have been transactions. From last time to May, there have been almost no transactions for almost 2 weeks. Now there have been fewer transactions. I think this progress may increase. So what is the basis for this? Everyone has to trust us. In a sense, everyone has to trust our commitment, right? We all have a commitment here, and we need to implement it in the industry. In addition to internal measures, some external measures may be implemented relatively quickly.

Speaker #3: Okay, let me translate for Mr. Xi. I think he is seeing in the market that there are some transactions happening at roughly 40,000 RMB per ton, or about 40 RMB per kilogram.

Ming Yang: Okay. Let me translate for Mr. Shi. Okay. I think he is seeing in the market that there is some transaction happening at roughly CNY 40,000 per ton or about CNY 40 per kilogram. Although there is a very low volume of transactions right now, even though the overall demand is relatively weak. But there are some wafer producers in the industry that have a very low to no inventory, whereby they are procuring to production. So right now, we are seeing some transactions, although not very high. What we are seeing is some manufacturers are testing the market. So although the full cost model would stipulate around CNY 50 per kilogram, some producers are right now testing the market and selling at approximately CNY 40 per kilogram right now. And it has been about 2 weeks since the announcement of the manufacturers and the guidance from the government.

Speaker #3: Although there's a very low volume of transactions right now, even though the overall demand is relatively weak, there are some wafer producers in the industry that have very low to no inventory, where they are procuring to production.

Speaker #3: And so right now, we are seeing some transactions, although not very high. What we're seeing is some manufacturers are testing the market.

Speaker #3: So, although the full cost model would stipulate around 50 RMB per kilogram, some producers are right now testing the market and selling at approximately 40 RMB.

Speaker #3: Per kilogram, right now. And so it's been about two weeks since the announcement from the manufacturers and the guidance from the government. So we do think that, going forward, we are likely to see more and more transactions happen at this new price range.

Ming Yang: We do think that going forward, we are likely to see more and more transactions happen at this new price range.

Speaker #2: Understood. So, strictly based on the production cost, probably the quality and price will be higher than that. But given that, in this round of the anti-evolution initiative, there is not an acquisition plan afterwards.

Alan Lau: Understood. So strictly based on the production cost, probably polysilicon price would be higher than that. But given that in this round of the anti-involution initiative, there is not an acquisition plan afterwards. So if prices go up to 40 or maybe 45 or 50 RMB per kilogram, what do you think would happen? Because effectively this will reach to the cost level of more players. So who would be able to sell their products, or what do you think the end game of this round of initiative? Or is there some capacities will be shut down because of the higher energy consumption requirement, or how do you see this?

Speaker #2: So if prices go up to 40 RMB, 45, or 50 RMB per kilogram, what do you think would happen? Because effectively, this will reach the cost level of more players.

Speaker #2: So, who would be able to sell their products, or what do you think the end game of this round of initiatives is? Or will some capacities be shut down because of the higher energy consumption requirements, or how do you see this?

Speaker #4: This is internal.

Ming Yang: Let me translate for Mr. Xu first. Just a minute. Let me translate for Mr. Xu. He thinks that the recent energy quota policy from the government, where there is different energy usage requirements for the industry, he thinks this will lead to forced exit of a significant amount of capacity that have a significant or higher energy usage. We are likely to see that happen pretty soon. There is also the industry self-discipline, and there is a commitment from the various manufacturers that there should be a voluntary reduction of capacity or production. There is also a commitment that manufacturers should not be selling below production cost. We think that both of these are likely to happen.

Speaker #3: Let me translate for Mr. Xi first. Okay, just a minute.

Speaker #2: I forgot—this is what I could tell him. He can send it to him. 具体的我记不清楚了。能告诉一个重要的指数，就是因为现在来讲能耗太高，所以你是不够产能，就会被强制淘汰。没有电了，这是第一个。第二个就是国家是根据我们的，是有一些能耗决定了之后，我们就行业之力，就是大家来说要自动地减产。我们要自动地减产，大家要有自动减产。这就主要是基于一个诚信，基于一个诚信，一个承诺，大家要自动地减产。维持我们不能基于成本加销售的这个原则。这个我觉得还是有信心，因为各个公司的施工人都去参加了会议。

Speaker #3: Okay.

Speaker #4: 当然这个方面是说有能力生产的，还有一些企业这当中很多中国还有很多做这些企业，现在你就给他到60他也交不起来，因为他已经没有能力了。因为开动这个租金规的时候还有一个人的问题，培训的问题，时间的问题，对吧？这几个因素要素之后，它有的企业现在已经开不起来了。虽然它号称它能开起来，现在已经开不起来了。

Speaker #3: 这些产能已经到不了这个量，300万辆、200万辆，200万辆都很难。因为这段时间大家都亏钱了，有的人也招不到，有的公司就已经停产了，人已经解雇了，没人了，解散了，然后就。 Okay. Let me translate for Mr. Xi. Okay. He thinks that the recent energy quota policy from the government where there's different energy usage requirements, for the industry, he thinks this is will lead to forced exit of a significant amount of capacity that have significant or higher energy usage.

Speaker #3: So we're likely to see that happen pretty soon. Also, there's industry self-discipline, and there's a commitment from the various manufacturers that there should be a voluntary reduction of capacity or production.

Speaker #3: And then also, there's a commitment that manufacturers should not be selling below production cost. So, we think that both of these are likely to happen.

Speaker #3: Starting the second half of this year. And then there's also the issue that not that many producers actually have the capability to produce, especially now that the industry is running at a fairly low utilization level.

Ming Yang: Starting the H2 of this year. There is also the issue that not that many producers actually have the capability to produce, especially now that the industry is running at a fairly low utilization level. A lot of manufacturers have let go significant number of people. There is actually a lack of employees and also lack of training and time. A lot of capacity that have been shut down is unlikely to restart going forward. Even now, he thinks that, for example, the effective capacity within the industry, even though close to 3 million tons have been built, the effective capacity is already less than 2 million tons right now, it is likely to go lower as well.

Speaker #3: So, a lot of manufacturers have let go a significant number of people. So there's actually a lack of employees, and also a lack of training and time.

Speaker #3: So, a lot of capacity that has been shut down is unlikely to restart going forward. So even now, he thinks that, for example, the effective capacity within the industry is close to 3 million tons.

Speaker #3: Have been built, the effective capacity is already less than 2 million tons right now. It's likely to go lower as well.

Speaker #2: I'm trying to think if my last question is about the AIPC initiative as a second growth driver for the company. I wonder if there's any update on the backlog or progress to share on this new business.

Alan Lau: Thank you. My last question is about the AIDC initiative as a second growth driver of the company. I wonder if there is the backlog or progress to share on this new business. Thank you.

Speaker #2: Thank you.

Speaker #3: Okay, let me translate it. Okay, hold on.

Ming Yang: OK, let me translate. OK, hold on.

Speaker #4: Why is there AIPC that's not 因为我们综合考虑这个光伏的租金规，目前的现状要有一个大的增长，就是有很大的难度。大家都很清楚，市场的需求，还有光伏发电的这个规模都是可以预见的，还有国内还有这么多企业进去。所以大全作为我们是做电气产业的这个行业的这个应该讲对国内在做中国这个市场上，我们有很高的地位，做高低压承造开关，做这样的。而且今年AI的发展之后呢，我们知道了我们对市场的了解，因为我们做电气设备，应该讲开关、变压器是市场来讲我们是应该讲供不应求。所以我们经过市场的调研之后，我们觉得我们应该更做AIDC，就是AI有关的AIDC相关的一些。我们最最熟悉的行业来增加我们的一个必要的这个增长曲线。这基于是什么呢？我们的专业，我们的人才优势，我们的研发优势，非常厉害。上次在这个上个季度的时候，我们公布了这个我们的做法，我们的决定之后呢，我们没有和投资者来参加这个投资者的一个会议，因为我一个特殊情况，所以没来得及参加这个会议。正好今天也趁这个机会跟各位投资者可以来解释一下关于这个大全的AIDC，大全能源的AIDC方面的这个一些产品的优势。因为我们是做这个产品，大全基于这个方面电力行业的这个基因，所以我们对AI的这个电力需求的事情，电力需求是市场是比较了解的。所以我觉得呢，AIDC这个行业我们来讲跟我们来说做这个电力设备，包括它里面呢，电力厂，对吧？包括它里面的这个IT厂，包括它的发电厂，我们都非常熟悉。这是我们在AIDC的一个现成的产品，投资来说，现在大家都清楚。我们的AIDC当中呢，SST、SSCB、固态开关和固态变压器，现在来说都是全球应该讲是一个未来的一个方向。虽然明年没有SST没有太多的市场，包括英伟达，英伟达的这个方案，英伟达的这个DC800的方案和现在中国阿里的阿里的巴拿马的方案，对这个电力的需求是很大，而且大全这个方面优势是非常非常明显。所以我们想在这个方面我们应该这个运用我们现在大全能源，大家New Energy这里面呢，资金的优势，我们现在有资金的优势，加上这个是应该讲是一个巨大的一个增长的增长的风口，我们来投入这个行业的这个市场的这个投入，市场的这个加上研发市场。这是我们优势的体现，优势的体现，也是这个行业我们就非常熟悉。现在我们在做的是什么呢？我们有一个自己的一个研发的队伍，我们现在在上海成立研发的队伍，所以我想呢，在2026年、2027年我们应该有销售，应该有销售，因为大家都是把行业有很多的客户资源，有应该讲有一流的，我们研发团队，我们也想做到实际上一流的研发工程师加入我们团队。所以AIDC电力这个系统，电力市场的SST这个方面能够作为行业的领先者，甚至全球的领先者，这是我们的优势。而且我们现在也有现金流，我们有自己现金流，我们可以大胆地去投入，大胆地去说这句话，大胆地去投入，应该讲我们做到做建成一个一流的工厂，一个一流的人才的队伍，人才的队伍，还有一流的制造设备，在尽管讲的时间之内形成我们销售，形成我们收入，为我们这个公司创造利润。因为首先这个人讲的强调一点，就是我们这个行业非常熟悉。

Xiang Xu: 关于AIDC的事情，其实这是大全的第二赛道。因为我们综合考虑光伏的多晶硅目前的现状，要有一个大的增长其实有很大的难度，大家都很清楚。市场的需求，还有光伏发电的规模都是可以预见的，国内还有这么多企业。所以大全作为电力产业的行业的，应该讲在中国这个市场上，我们有很高的地位，做高低压成套开关。而且经过今年AI的发展之后，我们知道了，我们对市场的了解，因为我们做电气设备，应该讲开关、变压器，对市场来讲，我们是拥有话语权。所以我们经过市场的调研之后，我们觉得我们应该跟做AI有关、AIDC相关的一些我们最熟悉的行业来增加我们第二个增长曲线。这基于是什么？我们的专业，我们的人才优势，我们的研发优势。你看上次在这个月，上个月初的时候，我们公布了我们的做法，我们的决定之后，我们也有和投资者来参加投资者的一个会议。因为一个特殊情况，也没有一次参加这个会议。上次也有这次机会跟各位投资者来解释一下关于大全的AIDC，Daqo New Energy AIDC方面的产业。因为我们是做这个产品，大全基于电力行业的这个基因，所以我们对AI对电力需求的市场是比较了解的。所以我觉得AIDC这个行业，我们来讲，我们做这个电力设备，包括它里面的电力厂，包括它里面的IT厂，包括发电厂，我们就非常熟悉，这是我们在AIDC一个现成的产品。同时来说，甚至大家都很清楚，我们的AIDC上，我们的SST、SSCB负荷开关和负荷变压器，现在来说都是全球应该讲是一个未来的一个方向。虽然明年SST没有太多的市场，我们英伟达就英伟达的这个方案，英伟达的这个800V DC的方案，和现在中国阿里的巴拿马的方案，对这个电力的需求是很大，而且大全在这个方面优势是非常非常明显。所以我们想在这个方面，我们应该利用我们现在大全能源，Daqo New Energy这里面的资金的优势，我们现在有资金的优势，加上这个应该讲是一个巨大的一个增长的峰值，我们来投入这个行业的市场，市场的投入，市场的加入，研发制造，这是我们优势的体现。这个行业我们就非常熟悉。现在我们在做的是什么？我们有一个自己的一个研发的队伍，我们有一个上海的研发的队伍，所以我想在2026年、2027年，我们应该有销售。因为大家这个行业有很多的客户资源，有应届奖，有一流的我们研发团队，我们也想做到世界上一流的研发队伍加入我们的团队。在AIDC电力这个系统上面，SST这个上面，能够作为行业的领先者，甚至全球的领先者，这是我们的意思。而且我们现在也有现金流，我们可以大胆地去投入，那里是手中有万，胆子有四的投入。应该讲，我们做建成一个一流的工厂，一个一流的人才的队伍和一流的制造设备，这尽管讲的是实现我们的销售，实现我们的收入，为我们这个公司来创造利润。所以这边整个强调一点，就是我们这个行业非常熟悉。

Speaker #3: Okay, let me translate for Mr. Xi. So, we do see that the AIDC-related power infrastructure and equipment market is actually a very viable sector. It's going to be a significant growth driver for the company, and it's the second sector that the company is entering into.

Ming Yang: Okay, let me translate for Mr. Xu. We do see that the AIDC related power infrastructure and equipment market is actually a very viable sector where it is going to be a significant growth driver for the company, and it is the second sector that the company is entering into. I think as most investors are probably aware, that we do think that the growth for the polysilicon market going forward is likely to be relatively low in terms of volume demand as well as for solar. The company is actively looking for other areas of growth. Because Daqo Group has more than 40 years of experience in the power equipment sector and being one of the leading manufacturer and supplier of high and low voltage power equipment such as a transformer and circuit breakers.

Speaker #3: So, I think small investors are probably aware that we do think the growth for the polysilicon market, going forward, is likely to be relatively low in terms of volume demand, as well as for solar.

Speaker #3: So the company is actively looking for other areas of growth. And because DAKO Group has more than 40 experience 40 years of experience in the power equipment sector and being one of the leading manufacturer and supplier of high and low voltage as, for example, power equipment such as transformer and circuit breakers, so DAKO Group is seeing a very strong demand especially in AI data center related power equipment demand.

Ming Yang: Daqo Group is seeing a very strong demand, especially in AI data center related power equipment demand. We do think this is a very significant and real opportunity for the company. Daqo Group brings many years of experience and advantage in manufacturing, in R&D, in technology capability, in terms of products as well. With the growing AI power demand, and especially for the next generation power infrastructure for AIDC, where led by NVIDIA, there is this future development of a new next generation of equipment under the 800 volt DC infrastructure. We are targeting initially in the solid-state transformer and solid-state circuit breaker market. The industry is starting in 2027, next year. Then we expect to see very significant growth from 2028 to 2030 with power demand from these new AI data centers based on the new 800 volt DC technology.

Speaker #3: So we do think this is a very significant and real opportunity for the company. And Daqo Group brings many years of experience and advantage in manufacturing, in R&D, and in technology capability.

Speaker #3: So in terms of products, as well, so with the growing power demand and especially for the next generation power infrastructure for IDC, where led by NVIDIA, there's this future development of a new next generation of equipment under the 800-volt DC infrastructure for so we're targeting initially in the solid-state transformer and solid-state circuit breaker.

Speaker #3: So the market, the industry, is starting in 2027—next year—and then we expect to see very significant growth from 2028 to 2030. And with power demand from these new AI data centers based on the new 800-volt DC technology, with DAQO Group, it brings significant experience and advantage.

Ming Yang: With Daqo Group, it brings significant experience and vantage at the same time matching with Daqo New Energy's strong balance sheet and capital position to capture this growth driver. Now we have built an R&D team in Shanghai, and we expect to have an initial product ready by year-end. Then with prototypes and then by achieving sales starting in 2027 and then capturing the growth opportunity 2028 to 2030. Our goal to become an industry leader within this AIDC power equipment sector by being a Tier 1, both in terms of product and the team. That is our current end goal right now.

Speaker #3: And at the same time, matching with Daqo New Energy's strong balance sheet and capital position, right, to capture this growth driver. So now we have built an R&D team in Shanghai, and we expect to have an initial product ready by year end, and then prototypes, with sales starting in 2027. Then we will capture the growth opportunity in 2028 to 2030, with our goal to become an industry leader within this IDC power equipment sector by being tier one, both in terms of product and the team.

Speaker #3: So that's our current goal right now.

Speaker #1: Yeah, thanks a lot for the management. Good explanation. I'll pass on. Thank you.

Alan Lau: Yeah, thanks a lot for management detailed explanation. I will pass on. Thank you.

Speaker #3: Great. Great. Thank you, Alan.

Ming Yang: Great. Thank you, Alan.

Speaker #2: Our next question comes from Mona Wang with Goldman Sachs. Please go ahead.

Operator 2: Our next question comes from Mengwen Wang with Goldman Sachs. Please go ahead.

Operator: Our next question comes from Mengwen Wang with Goldman Sachs. Please go ahead.

Speaker #4: Sure. Thanks, management, for taking that question. I have two questions: one is related to the Poly business, and another to the AIDC business. So first, in terms of the Poly business, I think you just mentioned that currently, the industry's upstream and downstream players are kind of in a wait-and-see mode, and given that downstream inventory is at a relatively high level, I'm not sure what outcome you expect after the wait-and-see period?

Mengwen Wang: Sure. Thanks, management for taking my question. I have two questions. One is related to the poly business and the other to the AIDC business. First, in terms of the poly business, I think you just mentioned currently the industry upstream and downstream players is kind of wait and see, and given the downstream inventory is at a relatively higher level. I am not sure what outcome do you expect for after the wait and see period? Particularly, we had this kind of self-discipline in H1. We uphold our pricing and then we record a lower shipment. I am wondering, do you have any shipment guidance though, towards the end of the year? What is our priority going forward? Will we uphold the pricing to the higher level, like CNY 50,000 per ton, or we are kind of want to reach the balance between price or shipments?

Speaker #4: And particularly, we had this kind of self-discipline in the first half; we upheld our pricing and then recorded lower shipments. So I'm wondering, do you have any shipment guidance towards the end of the year?

Speaker #4: What's our priority going forward? Will we uphold pricing at the higher level, like $50,000 per ton, or are we trying to reach a balance between price and shipment?

Speaker #4: So, I want to hear more about the poly business operation strategy. Thank you.

Mengwen Wang: I want to hear more about the poly business operations strategy. Thank you.

Speaker #3: Okay. Okay. Thank you, Mona. So let me translate your question for Mr. Xi, and then he will respond. Okay. Just a minute. 怎么看发货?

Ming Yang: Okay. Thank you, Mona Wang. Let me translate your question for Mr. Xu and then he will respond. Just a minute.

Speaker #5: 这个我认为我的概念是下半年我们对我们来讲就是发货应该讲我们产品质量比较好。发货不是问题，主要还是价格的问题。价格的问题。价格的问题当中是什么? 就是说今年上半年我们发货的比较少。按照我们这个行业制定大型的产能应该是能发货应该超过这个应该能达到15%到15%的至少份额之间。超过这个份额是合理的。所以说这个呢是呢我们还会进一步的按照我们当时的想法就是合理的价位我们去发货。但是今年是怎么因为全行业已经亏损了不是一年了，所以很多企业很难支撑得下去。未来的时候我认为一定有一些成本高的企业建立一个不好的企业会被淘汰。第二，能耗不高，能耗的能耗指标不达标的，它会被政府强迫淘汰。所以这都是对我们是一个利好的事情。所以我觉得是大权能源我们大权能源有足够的这个现在有这样的这个好的良好的财务状况和良好的质量标准和良好的质量还有我们下游客户的这个评价好的这个优势，我想我们下一步我们想在这个应该讲反类的大环境之下我们想就是能够把我们的库存降到最低。这是我觉得未来从未来来说今年我还不敢明确的讲我认为明年的形势会更好。因为今年正在大家现在来看下来现在这个价格也在提升，当然不仅仅是我们贵贱的问题，包括我们的贵贱不仅是贵价的问题，包括我们的贵贱介质价格也在上涨。因为现在的价格都基于现金成本价，这完全不合理的，完全不合理。也不是也应该讲是这种倾销的行为，也是我认为也是个违法的行为，因为价格反倾销。所以我想这个应该会有点也必须有点这种这种评估。

Xiang Xu: 我认为我的观念是下半年对我们来讲，发货方面，我们产品质量比较好，发货不是问题，主要还是价格的问题。价格问题当中是什么？就是说今年上半年我们发货的比较少。按照我们这个行业，大全的产能应该是能发货应该超过15%到18%，至少范围之间。超过这个范围是合理。所以在这个前提下，我们还会进一步的按照我们当初的想法，以合理的价位去发货。但是今年因为全行业已经亏损了不是一年了，所以很多企业很难支撑得下去。未来的话，我认为一定有一些成本高的企业、现金流不好的企业会被淘汰。第二，能耗不高，能耗指标不达标的，会被政府强制淘汰。这都是对我们利好的事情。所以我觉得大全能有足够的现金，有良好的财务状况和良好的质量标准，还有我们下游客户评价好的优势，我觉得下一步我们想在这个应该讲白热化的大环境之下，能够把我们的库存降到最低。从未来来说，今年我还不敢明确地讲，我用明年的形势会更好。因为今年大家现在看下来，价格一直在提升。当然不仅仅是我们硅料的问题，包括我们的硅片，不仅是硅料的问题，包括我们的硅片，现在价格也在涨。因为现在的价格是基于现金成本价，这完全不合理。也不是要灭掉这种倾销的行为，也是我认为这个违法的事情，应该加个括号。所以我想这个应该会有点，也必须有点这种情况。

Speaker #3: Let me translate for Mr. Xi. So, in the second half, what we believe is that, because Daqo New Energy has a superior quality of product in the market...

Ming Yang: Let me translate for Mr. Xu. In H2, what we believe is that because Daqo New Energy, we have a superior quality of product in the market. Selling and shipping our product is really not an issue. I think the question is really price. In H1, because we adhere to self-discipline, we did not sell as much products as our normal market share. Because our competitors were engaged in low-cost sales practices. But if we look at our market share in the past, we believe that we can achieve approximately 15% market share within the industry, and we continue to expect that going forward. Our target is to sell at appropriate price or a reasonable price, so be fully compliant with the government guidance and the price law.

Speaker #3: So in selling and shipping, our product is really not an issue. I think the question is really price. So in the first half, because we adhered to self-discipline, we did not sell as many products as our normal market share.

Speaker #3: So, because our competitors were engaged in below-cost sales practices. But if we look at our market share in the past, we believe that we can achieve approximately 15% market share within the industry, and we continue to expect that going forward.

Speaker #3: So our target is to sell at an appropriate price, or a reasonable price, and also be fully compliant with the government guidance and the price law.

Speaker #3: So, what we expect is that, in the next six to eighteen months, we're likely to see a forced exit or a market-based exit of manufacturers with high production costs, or manufacturers with poor cash positions or poor cash flow.

Ming Yang: What we expect is that, in the next 6 to 18 months, we are likely to see a forced exit or a market-based exit of manufacturers with high production costs or manufacturers with poor cash positions or poor cash flow. Companies with not a good stance are likely to continue to struggle going forward. While Daqo New Energy with our cash position and our strong balance sheet, also our high product quality at low cost, we expect that we are likely to do better and to do well in the market. Especially in 2027, where we expect to see a much improved and better market environment. Then we expect to continue to lower our inventory going forward to relatively low inventory levels. That is our target.

Speaker #3: So, companies with not a good balance sheet are likely to struggle and continue to struggle going forward. While Daqo New Energy, with our cash position, our strong balance sheet, and also our high product quality and low cost, we expect that we're likely to do better.

Speaker #3: And to do well in the market. So, especially in 2027, we expect to see a much improved and better market environment. Then we expect to continue to lower our inventory going forward, to relatively low inventory levels.

Speaker #3: That's our target. Okay.

Mengwen Wang: Okay, thank you. Can I conclude that we will hold up the price in your turn, and we will wait the rest of the marginal players to exit, and then at that time we will see fast inventory depletion and the recovery of the shipment is likely to occur in the next 6 to 18 months?

Speaker #4: Okay, thank you. So, can I conclude that we will hold up the price in your term, and we will wait for the rest of the marginal players to exit, and then that's the time we will see?

Speaker #4: We see fast inventory depletion and recovery of the shipment. It's likely to occur in the next six to eighteen months.

Speaker #3: I think in terms of pricing, right? So, I mean, we definitely cannot sell below cost, right? So we're going to adhere to that.

Ming Yang: I think in terms of pricing, we cannot sell below cost. We are going to adhere to that. At the same time, we will look for opportunities to sell at a reasonable price. Then wait for the market to have additional capacity exits. Yes.

Speaker #3: And then, at the same time, we'll look for opportunities to sell at a reasonable price. And, yeah, then wait for the market to have additional capacity exits.

Speaker #3: Yes.

Speaker #5: When I had to answer your question.

Xiang Xu: 我来讲一个事情。

Mengwen Wang: Okay, that is super clear. My second question about AIDC. I think we have put out an announcement, like we have CNY 6 billion total investment, CNY 2 billion in the first phase. You just mentioned we will have sales volume recorded in next year. Just wondering, can you share a bit more about the plan for the AIDC business specifically? Like our CapEx timeline and the source of capital for this CNY 6 billion or CNY 2 billion investment, and what is our expected payback duration for the first phase of the production phase, and what is the normalized profitability from this business do we expect we will achieve. Also for other operating metrics, will we have more other sources allocated for this new business development? Or we can use some of the synergies from our Daqo Group, the aligned company.

Speaker #4: Okay, that's super clear. And my second question about AIDC: I think we have put out an announcement—like, we have RMB 6 billion in total investment, with RMB 2 billion in the first phase.

Speaker #4: And you just mentioned we will have sales volume recorded next year. So, just wondering, can you share a bit more about the plan for the AIDC business—specifically, like our CAPEX timeline and the source of capital for this $6 billion or $2 billion investment?

Speaker #4: And what's our expected payback duration for the first phase of the production phase? And what is the normalized profitability from this business that we expect we’ll achieve?

Speaker #4: And also for other like operating metrics, will we have more other sources allocated for this new business development or we can use some of the synergies from our DAIKO group, the aligned company, so a lot of details that can you share a bit more regarding to these metrics?

Mengwen Wang: A lot of details about, can you share a bit more regarding to these metrics? Thank you so much.

Speaker #4: Thank you so much.

Speaker #3: Okay, okay. Let me translate your question first, quickly. Okay, hold on.

Ming Yang: Okay. Let me translate your question first quickly. Okay, hold on. Okay. Let me translate for Mr. Xu. I think first of all, let me just clarify on the investments involved. Even though the total project anticipated investment is CNY 6 billion, we are only committing the first phase right now, which is about CNY 2 billion, which will cover all of solid-state transformer, solid-state circuit breaker, and also our e-house total solution for AI power infrastructure, and also some related to energy storage. The remaining CNY 4 billion is not committed as of today, and will be planned sometime in the future. In terms of our strategy, we are focusing on AIDC-related power infrastructure or equipment. We expect to have three primary products, right?

Ming Yang: Okay. Let me translate your question first quickly. Okay, hold on.

Speaker #5: 好。这个大田这次投资AIDC的相关的设备，主要是这里面是我们的放长记号、SST、SSCB。明年去年看到的是跟电力有关的记号机。这块我认为明年我们是有销售，因为讲爬坡应该是爬坡阶段，但很快。同时这是一块，这是一个产业，明年能看到我们的销售。我想这个销售应该讲跟我们对大田的这种应该讲整体的系统大体就能协同。所以这个能力我们很强，应该讲我们应该讲应该讲有我认为有足够的订单来支撑我们这个产业，这个产业。至于现在是什么，我们新的投资能够把我们的工厂尽快建成，其实要是能够把我们的设备尽快地安装到位，制造的设备到位，当然人才的队伍是继续市场和大田集团原来的一些专业的工程师，我们会让他找新的工程来工作，新的工程工作。这是我想我们在做的。同时我们要启动我们正在研发SST。SST应该讲今年明年的市场还没有全面的爆发。我想在未来的爆发之后之前，我们从充分的准备来迎接这一次应该讲一个新的机遇和机会。这是我们在AIDC。所以我也相信我明年我们AIDC一定有销售，一定有应该讲爬坡速度非常快的局势。这个我对这个行业我非常熟悉。因为现在前期的市场调研，大家对大田我们的客户，我们的做成的合作伙伴，对大家来讲做AIDC方面的一些设备，大家是充满了信心不信任。

Speaker #3: Okay. Let me translate for Mr. Xi. Okay. I think, first of all, let me just clarify the investment involved. So even though the total project’s anticipated investment is RMB 6 billion, we’re only committing to the first phase right now, which is about RMB 2 billion. This will cover all of Southeast Transformer, Southeast Circuit Breaker, and also our eHouse total solution for AI power infrastructure.

Ming Yang: Okay. Let me translate for Mr. Xu. I think first of all, let me just clarify on the investments involved. Even though the total project anticipated investment is CNY 6 billion, we are only committing the first phase right now, which is about CNY 2 billion, which will cover all of solid-state transformer, solid-state circuit breaker, and also our e-house total solution for AI power infrastructure, and also some related to energy storage. The remaining CNY 4 billion is not committed as of today, and will be planned sometime in the future. In terms of our strategy, we are focusing on AIDC-related power infrastructure or equipment. We expect to have three primary products, right?

Speaker #3: And also, some are related to energy storage. The remaining $4 billion is not committed as of today, and it will be planned sometime in the future.

Speaker #3: And then, in terms of our strategy, we're focusing on AIDC-related power infrastructure equipment. We expect to have three primary products, right?

Ming Yang: One is the total solution or a package solution which is going to be a plug-and-play kind of solution for AI power infrastructure, which has all the related power equipment. Also on solid-state transformers and solid-state circuit breakers, this will include the related software and control. There is very significant synergy with Daqo Group because of Daqo Group's experience and know-how, and also their position within the market. We think that we can receive significant orders from customers. We are now in the phase of doing R&D, and also the building of related manufacturing facilities. The R&D team is now in place, and we continue to expect to have our prototype ready by year-end and getting these products. In terms of 2026 and 2027, it is really a preparation period and introduction of the products into the market.

And then um, we expect to have a 3 a primary a products, right, right. So 1 is a a total solution or a package solution for with, which is the 1i power infrastructure, which, which has all the related, uh, Power Equipment and then also our solid state Transformers and solid state. It's a kit Breakers and it will include, uh, the related software, and, and control. And there's very significant Synergy with Taco group where we because of Dr. Coops experience and know-how and, and also their uh,

Ming Yang: We think that the market will see a high growth phase from 2028 to 2030, and we do expect a significant ramp-up of revenue during this period for these related products and business. All right. Thank you, Mengwen.

Uh the building of of related manufacturing facilities and the R&D team is now in place and we we continue to expect to have our prototype ready by year end and getting this these products. Uh so in terms of 2026 and 2027 is really a preparation period and production of the uh product

Into the market. And we think that the market will see a high growth phase from 2028 to 2030, where we do expect a significant ramp-up of revenue during this period.

For these related products and business.

Xiang Xu: 我补充一点。

All right, thank you. One moment.

Mengwen Wang: OK.

Ming Yang: OK.

Mengwen Wang: Hi, Ming. Just one very small question. For the CNY 2 billion committed investment, we will extend in 2026, right?

For the $2 billion committed investment, we will expand into 2026.

Ming Yang: Over the next two years. This year is only about, I think maybe $30 million to $40 million US dollars this year. The remaining will be over the next two years.

Uh, over the next two years—this year is only about...

uh,

I think too, yeah, it's only maybe $30 to $40 million US dollars this year.

And then the remaining will be over the next two years, actually.

Mengwen Wang: OK, thank you very much.

Xiang Xu: OK, thank you very much.

Mengwen Wang: That is all from me. Thank you.

Sure.

Ming Yang: Thank you. Our CEO will make additional comment.

Xiang Xu: 我讲一句话，就是关于半导体的事情。大体上除了12点的事情，当初在爱尔兰募集资金的时候，有个投资项目，半导体项目。半导体项目一年一直在做认证。原来时间周期比较长，但是现在半导体，明年的半导体市场的需求，全球我了解是7.6万吨，7.5到6万吨。明年的市场产量只有5.7万吨。所以我们现在还是希望能够尽快把半导体的项目能够拿到认证。半导体的行业给我们带来更多的价值，这当然需要我们整个团队把它做起来。

Thank you. Uh, and then, our COO will make additional comments.

Again.

Ming Yang: Mr. Xu will provide an update on our semiconductor polysilicon business. The company has spent a total investment, including land and related equipment facilities of about 1.2 billion RMB into the business. We have been doing product trial production, also in terms of qualification with our customers. The qualification cycle has been much longer than we anticipated, but we are continuing to do this. He is very optimistic that he is looking at very significant market demand. The expected demand for semiconductor poly is roughly 75,000 tons per year, while right now the current industry production for semiconductor poly is only about 57,000 tons per year. He is expecting a very significant growth for this product, this market sector. We are going to wrap up and reinvigorate our activities for this.

Okay, and, and Mr. She will will provide an update on our semiconductor policy and and business where the company has spent a total of investment including land and related equipment facilities of about, uh, 1.2 billion R&B into, uh, the business. And, you know, we've been doing um, product, uh, a trial

Production and also in terms of qualification uh and with our our customers and and the site uh the qualification cycle has been much uh longer and then we anticipated but we're continuing to to do this and and he's very optimistic that he's looking at very significant market demand.

And where -- and speaking math for something, not the poly, roughly 75,000 tons.

Per year. Well, right now the current industry production for semiconductor poly is only about 57,000 tons per year, so he's been suggesting a very significant growth for this.

Uh, uh, uh, uh, ah, ah, product that this, this Market sector. So, so we're going to wrap up and re re re in theory, our activities, uh, uh, for this

Xiang Xu: 好了吧。

Operator 2: This concludes our question and answer session. I would like to turn the conference back over to Jessie Zhao for any closing remarks.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Jessie Zhao for any closing remarks.

This concludes our question and answer session. I would like to turn the conference back over to Jessie Zhao for any closing remarks.

Jessie Zhao: Thank you everyone again for participating in today's conference call. Should you have any further questions, please don't hesitate to contact us. Thank you and have an awesome day. Goodbye.

If you have any further questions, please don't hesitate to contact us. Thank you, and have an awesome day. Goodbye.

Operator 2: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

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