DIOD - Earnings call transcript Q4 2018

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Operator

Good afternoon, and welcome to Diodes Incorporated's Fourth Quarter and Full Year 2018 Financial Results Conference Call. At this time, all participants are in listen-only mode. At the conclusion of today's conference call instructions will be given for the question-and-answer session. [Operator Instructions] As a reminder, this conference call is being recorded today, Wednesday, February 13, 2019. I would now like to turn the call over to Leanne Sievers of Shelton Group, Investor Relations. ahead. go please Leanne,

Leanne Sievers

welcome results fourth Sievers, conference Diodes' Shelton and year President and XXXX Group, firm. Relations financial call. Investor to afternoon, quarter Diodes' full of Good I'm Leanne

Rick and today us Keh-Shew Financial of Yang; Marketing, are Sales President and Investor White; Joining Mehrl. CEO, Director President Vice of Diodes' Lu; Dr. Chief and Emily Worldwide Officer, Relations, Laura

they our today over and Before Dr. company's Lu, and as remind the are firm. to accounting announce results call procedures to registered subject independent company listeners turn year-end the the I like that closing the to finalizing are preliminary I'd public review the by quarterly customary

As the year such, to XXXX. subject its are the revision and fiscal Company these until Form results unaudited files XX-K for

Private prepared claims which risks statements, the management's protection addition, in are may additional forward-looking company contain uncertainties, safe and for contained to statements forward-looking remarks the the to response Therefore, make that the statements management is and forward-looking in of filings Exchange harbor Act XX-K questions. subject your risks In we from therefore XX-Q. Actual discussed XXXX. more those Securities Reform the the of results Form and differ you in company's discussion uncertainties may of today and to detailed Commission the including with and refer Litigation and Securities

future applicable XX, the addition, extent required Diodes in assumes the the as management's to law. not market company's February these change to of or any may projections today XXXX. to projections estimates no In future conditions by performance as except represent update may obligation as

to and items, non-GAAP attributable this statements during to stockholders release income. call, management financial included GAAP the are Also as of press net and net which discussions we will during statements to company's press this non-GAAP of term, provide income and call in the Additionally refer common GAAP release GAAP the company's conference reconciliations certain and measures in press details. company's include release definitions information throughout management additional conference to

be webcast to this you XX website Lu. Lu, via the section Dr. in President available And turn CEO, please days entire For those now, I'll Diodes recording call listen Relations unable Keh-Shew at over to Diodes for and Dr. to of of www.diodes.com. at Investor the go will time ahead. a call the

Keh-Shew Lu

non-GAAP Leanne. growth, you, and prior joining gains with Welcome us year year. in I'm the and financials. for the performing that everyone to driven increase today. XXXX market Thank continued report the you over thank by share record in organic a profitability achievement best revenue history XX% Diodes' of pleased represented XX%

result combined on ongoing automotive growth XX% industrial and Our XX% XX% those and markets is respectively sectors focus from revenue. and total in target of annual revenue of

XX% and Additionally, our storage, in result business grew content our to as almost excluding center product increased Pericom year-over-year primarily of revenue data the a frequency of server, PC, high-end market. XX% control

XXXX applications During and key line, same at position we multi the but Diodes at across customers product customer. made only not gaining also on within significant progress shares,

as all in largest well they diversification customers. which as offer, some greater of customers Diodes use fact, deeper our those provide nearly for content In with a relationship Diodes product

and to Diodes all a agreement, diodes. Also as in and This XXX,XXX as manufacture X-inch GFAB, located those dollar wafer XXX,XXX GFAB. to is our profit More part foot fab expected fab of of closing wafer next accretive. XXXX. with expansion the have also revenue TI engineering over products facility proposed transition strategic transfers other our product creating potential our of to the material growth TI's for transition, wafer completed square knowhow operation several to and the acquisition to plan new fabrication into support leverage This announced as its technical It to additional cross-selling our facility and as applications at have particularly provided is the also significant closing we Texas will Pericom subject wafer about Our the the from or Greenock, and Diodes first TI capacity strategic and end product meets expectations. continue quarter will Diodes multi-year the performance of into fabs. supply equipment to Further, operational our growth capacity in additional equipment be now opportunities end support us automotive extensive in and immediately opportunity skill Scotland wafer monthly our for other in which acquisition a well will is provides offerings. years it initiatives. and acquisitions conditions customary proposed of approximately pleased The I'm and products products Instruments' be greater excellent and enter expect offers for also recently, has acquisition

while coming we to anticipated gaining growth to served market, products. As and XXXX, expect continue Pericom and the and storage, rate as theme year prioritizing industrial and servers IoT. across we opportunity Diodes and Underpinning a our across our content XG gains high-end higher-margin for look forward automobile, cars, available market serving that exceeding our in growth share achieve key connected

We XXXX. turn are growth profits now and our to let Rick to across first again over With call more to records quarter expect our discuss financially results detail. and first in the reach that, well business me guidance drive positioned and revenue flow quarter in to financial and cash XXXX on new our operationally both increasing once incremental

Rick White

everyone. Thanks, and afternoon, Dr. good Lu

results, to detailed more today, of well full part my for press will refer our review a change year-over-year fourth significantly on financial year quarter, As third select you the as full my normal X% release as I a fourth would sequential quarter sequential comparisons. for quarter of decrease XXXX a $XXX.X the our year This X% the our the is results, was for million, as focus XXXX. $XXX.X and review Revenue and comments as seasonality. well in below from million the decrease

million or over XXXX and year in record of was full $XXX.X the well an of a XX.X% growth revenue third quarter the at $XXX.X margin product Shanghai billion Gross profit XX.X% ramp over revenue markets. improved increase fourth to compared in quarter increase XXXX. of or to mix, due our the served million The XXXX sequential For revenue well as was of continued facility $X.XX the was as XX.X% in billion, X-inch primarily for fabrication gross our of as the $X.X SFABX.

million compares million including of compared and $X.X $X.X expense. XX% expenses of $XX.X the million year. XX.X% For XXXX revenue taxes which non-controlling other record amounted gross XXXX XX.X% million for in basis. quarter a of the revenue intangible acquisition quarter non-GAAP million the XX.X% in GAAP increased asset XXXX. million the for excludes $XXX.X or to quarter, XXXX of or XX.X% [ph] compared a operating on $X million the million or of full profit with $XX.X to Income a as to or XX.X% Total expenses of expenses. of interest $XXX.X million the of revenue revenue GAAP $XX of fourth of basis, quarter non-GAAP million and [Technical related and revenue approximately third were of prior amounted year amortization of XX.X% $XX.X in of difficulty] interest revenue $XX.X expenses or million fourth before $XX.X operating to on This or to

third impact respectively. quarter full EPS quarter, quarter tax loss fourth XXXX third share XX.X% or for income, diluted revenue or GAAP compared fourth GAAP million million $X.XX with shares. GAAP or $XX.X million diluted quarter the which $X.X share $X.XX quarter quarter in for Reform. XXXX. the reconciliation diluted additional to per the adjusted the diluted net or Fourth quarter fourth a which income of XX.X% net year effective compared full in difficulty] of the in XXXX to compares XXXX $XX.X Tax our EBITDA a included provides a of XXXX taxes, year included or adjusted for $XXX.X Non-GAAP year for income We've million $XX.X details. diluted the to which net per of or compared non-GAAP XXXX. diluted was $XX.X million GAAP with $X.XX in XXXX. per share, of $XX.X million to $XX non-GAAP revenue non-cash $X.XX the for [Technical compared were record per approximately per release of XX.X% $XXX income was XX.X% used share third or full and million was a rates the share to $X.XX costs. and year $X.X diluted million million net per $X.XX amortization income non-GAAP asset intangible per net or of share, full tax income This XXXX was share per loss to count the XX.X for quarter million GAAP income net Turning fourth or our $X.XX related XXXX. net of the million share, the net $XX.X compute income adjusted XXXX million to in diluted or XXXX was The for a adjusted of XX% record earnings XXXX acquisition share, excluded $X.XX increased the

revenue $XXX.X year or or improved of XXXX full in to EBITDA XXXX. the revenue $XXX.Xmillion compared XX% of For million XX.X% with XX% record a

in $XX.X of GAAP operations $XX.X the fourth We for for XXXX capital million additional of a provides cash fourth including and in year entity. a expenditures $XX.X in the $XX.X to additional $XX.X $XX.X including was full year the $X.X million million was Cash million from was fund our a million positive Net which expenditures. corporate was $XXX.X million million for long-term have Free debt. the long-term net included positive included million $XX.X flow quarter cash reconciliation Net a quarter, included full year. income fourth million of the $XX.X flow flow generated committed for earnings cash which and down release pay details. full of flow previously EBITDA, the which shareholder increase million, to quarter debt equity of Chengdu approximately for a the capital the of of company's

$X.X cash in was $XXX.X fourth and decreases, inventory XXXX. million short-term process. third a XXXX XX reducing and were in equivalents quarter including in million investments finished the million. million. inventory on the revenue finished the The in goods $XXX.X Finished the decrease to in debt balance and finished This cash sheet, a of compared decreased $X.X a At quarter the X.X% expenditures from decrease to approximately plus quarter end $X.X quarter of our $XXX.X Capital the were and XXX million million capital quarter XXXX. quarter $X.X materials focus million. inventory totaled for the of quarter $XX.X portion inventory quarter end approximately Turning long-term of third quarter the raw inventory. the days in full approximately the cash million of was the of increase Total or consecutive to a year. inventory were decrease the XX million reflects fourth current third at goods, on the third XX million in fourth $XXX in in revenue for the work goods or days is $XX.X compared to reflecting basis goods Working X.X%

XXXX model We for the our expect revenue. X% of X% CapEx year to of target remain to within full

to XX% down we Now than period be approximately At over in is midpoint seasonality. typical which million represents sequentially, to and XXXX better growth slightly our minus expect year the X.X%. or prior outlook, approximately of of this turning plus revenue the $XXX X% quarter the first

of operating X%. to expenses GAAP GAAP or X%. expect which approximately or plus of intangible plus adjusted XX%, assets acquisition-related minus expenses, are be gross expected XX.X% be to revenue, minus Non-GAAP We are amortization margin for operating

We $X approximately be million. expect expense interest to

the that shares anticipated to quarter Our be over to and X%, or Please are call purchase turn income first be estimates. after-tax expected accounting diluted previous Yang. note plus tax to now to adjustments in of for and for these That used I EPS Pericom calculate approximately said, are Emily $X.X included million. XX.X not will million rate non-GAAP XX%, minus acquisitions is the

Emily Yang

Thank and you, good Rick, afternoon.

strong, channel POS X% Looking was yes, more X.X% sequentially. closely at and POS POS Asia, year-over-year. was But Outside by XX% Asia of inventory of typical this is in deals the down up distributor Year decreased region remains fourth Asia, sequentially POP primary driven quarter as pre-Chinese New X.X% preparation increased by of year. channel for time flat. was inventory at Outside revenue

XX%. XX% Looking sales of the fourth Europe Asia XX% North quarter, revenue, in at America represented the and global

MOSFET automotive terms in new assistance. steering, markets, In market secure largest of power continues industrial once almost revenue. infotainment, total Consumer XX% Starting our end water growth electric battery representative products XXXX increasing on to X% our electric and across and especially XXXX revenue XX%, market management power automotive including over XX% multiple to XX% the XX%, advanced brushless revenue. at of continues was again driving design motor, horn, revenue. Asia, represented end with communication windows, pumps, of to of be wins computing Diodes X% strong with DC

added In infotainment addition, which our design and USB power wire and to wins is mobile charging delivers applications. being of solution driving automobiles, wireless in

products rectifier cars. discharge and the automotive space, the a connected diodes our robust seen has need momentum Additionally, solid driven for the protection in electric by in

also of modules approximately body we industrial achieved year growth introduce XX% than time controllers. control light more We transistors, running full to and to revenues. In of LED saw demand accounting strong like day strong and junction continue new for also the linear products bipolar market, we total as XX%,

for sensors, products short lighting, wins our applications. our and range power design [ph] tools normal During MOSFET DC multiple motors, of data and hall including line applications technology, broad SDR trench e-lock density the we BJT platform, brushless key fan, LED DC quarter, for secured new

continue also our for SASP We see strong demand to products.

the with market data DC strong in in IoT across adoption lighting offer end industry. Diodes' suitable for of we high the product SBR for where the Schottky products links. speed temperature important high fact, and and becoming multiple record interfaces this more protection In remain environments. is application fan ESC

as our strong saw over into designed momentum systems, consumer regulators as into Gate revenue grew XXXX fans, as recently We into transistors end also test power for XX% well XXXX, Type introduced as C our power and speakers, a devices, argumentative In DC Bluetooth achieve portable to applications. controllers synchronize reality, we panels, wireless well of market USB charging as and Drivers low such Wi-Fi trackers. wide continue power OLED gaming, across charging, momentum deliveries, earphone, wearable, power displays, variety applications, smart as battery strong

as Type In C A as footprint adapters Type products, traction USB boxes market Type C end to well existing the the to C battery set-top new as addition, is such base. and for gaining the convert expanding install Type its

all signal this market and covers portfolio switching wide Our application's need.

are audio and Bluetooth the the significant alarming product our in Wi-Fi applications. Additionally, driven tracker by increases, for audio demand our revenue achieving high features

revenue achieving We appliance such our market been for home In has this communications, and engaged also design and footprint DFN as air small for conditioner, growth. and been synchronize MOSFET refrigerators. secured our key wins with wins applications, Drivers fans and Gate CSP portfolio have Diodes controllers design actively comprehensive in and

also address demand of increasing sensors to help strong hall to our smartphones for continue LDOs battery and expand MOSFETs also We portfolio to in and protection reduce this and consumption market see power battery life.

oscillators and activity require of strong data win chargers AC/DC of Further, Also base package key new within single we lasso Diodes [ph] high also low along for ultra-fast crystal IC, new profile mobile continued high XXX and mega wins design activities optical shifters of and XL a recovery in with product wide stage the Our Pericom and in to area design seeing quarter low for are also only High-speed the gaming cross demand mentioned, products, jitter Pericom growing charging gig timing active converters address charging portfolio Diodes out crystal in solutions gen-X transceivers applications. bandwidth and for for product rectifier MOSFETs. new stations, data applications range including brought switches, well market speed switches growth XXX and during the see applications line, transistor communications, in is the oscillators, this ReDrivers for smartphones, market. In noise XG the win products LDOs, from very product, of secured XXXX the strong PCI this our continue the MOSFETs build applications. need performance gig we're the as center for packet within factor multiplexers, adapters. a in as reference. opportunity and we Diodes beginning small the in driving form Computing, XG including our low jitter PCI and to with demand phones, Dr. of see beyond. strong infrastructure wireless ultra-low and Lu Also communications, and marks as position [ph] in and server we plus with design us including communications. applications

ReDrivers We C and X.X and also saw USB significant PC opportunities for in Type USB applications. tablet

continue as In adapting market connectors gain fact, options. applications C C USB Type traction, to are USB connector new Type

in notebook stocking commercial activity docking applications and signal reliable by latest our would maintaining signal the while for switching to mode station tablet, USB port sensor Diodes example, the reducing For also C solution expand in Type continue station notebook tablet supporting logos alternative display performance. C USB traction USB are power applications. gaining and for integrity and designing consumption, and signal require masters. supporting Type Hall

Additionally, such past In ATF summary, product of results at we design-ins retrofire Schottky our increased as power very applications pleased momentum, and market to of win our USB portfolio business are with design annual share content win product broad and expanded in technology achievement offerings our Delivery by customers. driven supply. and Power continues record across

continued our to offered Additionally, our automotive of also margin opportunities applications. our Pericom and focus higher on further while across a industrial has wide constituted growth, additional products variety

this With the profitability will open flow driving to the and for continue Diodes to growth questions. that, floor in we expect Operator? We come. years now cash strategy

Operator

Our of [Operator of the comes Benchmark. from line Gary first question instructions] Mobley

line Your is open.

Gary Mobley

of what the just release taking prepared question. your Good million, afternoon, in $XXX it QX clarification in $XXX with press reads million, for you, to everybody. mentioned point exactly you I guidance a I'm is? question Thanks hoping to a it want start your remarks for Rick, or revenue so

Rick White

$XXX it's million. Well

Gary Mobley

million. $XXX

Okay.

quarter. better doing than to in sequentially industry seasonal than X% in is second down question better nobody first is the my the So seasonal

truly a Could give and sense So faring than better much limb guys you guidance the by backed are of now? what a of why you demand on sort right us with how indicators that's a industry and go so not.

Keh-Shew Lu

Okay.

but seasonality I we about year our do product around a very always somewhere similar talking to think see down especially to XX%, from increase. last we content the for winning X% demand strong

during are from product, more new can shares but gaining think the you we see gain increase. the do more I shares not content just speech actually we more

So seniority one line content application due of the QX, by we slow but the effect some in the even see increase to reduced. our to when

Gary Mobley

Okay. question about your I acquisition. GFAB follow did a have

to willing reason So perhaps obviously perhaps TI it's deal with and strategy doesn't they're it. sell the

what just here the So to wondering is you in betting I'm is see facility or that going this benefit don't on they you're what arbitrage that strategically financially?

Keh-Shew Lu

to have they're them, obviously and more we capacity don't capacity want the to especially our have I smaller are don't for for - Diodes but do speak we a need for for X-inch, are X-inch fab really we they their for spending since XX-inch geography, products. moving but but enough

is us So move match the between this the right the of the two product suit into from usage it companies just when X-inch we really view. point portfolio the

profit and it's be the us I we capacity you able fab increase think going skill, and in either to will operations. for this peoples, see do also the in data speech significant can to Diodes the during the very provide the build GP future revenue positive and to be

Gary Mobley

Thank everyone. helpful. that's you Okay,

Operator

you. Thank

next Our of Shawn Research. question Harrison Longbow from comes

is open. Your line

Shawn Harrison

everybody and the Hi, strong on congratulations guidance. results

Keh-Shew Lu

Shawn. you, Thank

Shawn Harrison

the figure press to usually pay out acquiring, trying to like accretion purchase didn't get see Lu, bargain. price I know facility Dr. for provide that a you that you that to lot to in you release I'm can just the us? the you're something is the and TI

Keh-Shew Lu

Number do of disclosed. detail be agreement cannot the have we TI with purchasing one, the

it a fortunately M&A M&A is So able of you, to the cushion. to - accretive one do this acquisition provide things one key be tell my criteria it year immediately two my can remember one I within and criteria need meet is, but

this insignificant pay So two, say on what attention. is now Number I we that's the material. really always

Rick White

immaterial. It's

Keh-Shew Lu

Immaterial.

Rick White

immaterial both the as be So will perspective and and from of were negotiation TI and the disclosed. contracts the Diodes classifying this therefore details not

Shawn Harrison

or right FABX, know that XX,XXX your where something like a you. in enough. I level, current month which capacity, are Got kind terms X-inch of wafers you is that? now the at helpful the of That's versus production target On what

Keh-Shew Lu

last remember or X-inch in on year Yes, if since capacity start we beginning it you actually start of XXXX. working SFABX from

XX,XXX a is production month able in ramp are December first it the about we of XXXX. month March start we to wafer - And The up SFABX XXXX a by X-inch to maximum ramp are continue capacity in and capacity. hoping we is X,XXX to it only

about we're capacity X-inch SBR. so, this, MOSFET is talking And this for for when

somewhere around probably per six typically the So layers. five days

So XXX,XXX layers. X-inch wafer increment

Shawn Harrison

Layers.

Keh-Shew Lu

and good Layers. It's addition increase. a MOSFET to SBR especially our discrete capacity

Rick White

to X,XXX where the in SFABX. quarter between was in to actually got to fourth goal we So and and X,XXX that's the get

Shawn Harrison

first how it be you have able quickly Okay. will this base year? within it of customer to Is And that calendar port then half into fab the qualified. your and

Keh-Shew Lu

way. no No,

site another there do and the if actually we one. First, you qualification, which long, whole process and be of to take our need then already taking remember we year this process, fortunately the to process, to months to equipments the develop take do move it to probably on not six equipment, may probably that this the SFABX, three implement XXXX one develop like on need but in months we

we'll go customer say notice put customer all But it's to currently time them a demand that's notify approval event, down, and and immediately need one expect the will the and so TI, continue. need maybe keep able Then we continue I it and up future fab And to our important of our when sample. I give the to the accretive the probably for this probably may give up TI so end the it and supporting us year to will And while. customer product demand take go the start the to TI's why it's loaded. us

Emily Yang

Right.

say I depends, four the customer. really quarters one range from customer quarter would So three, for on the depends to probably qualification it

take going to it's So some time.

Keh-Shew Lu

it automotive for the industrial take we this Yes, it for to designing a and and while. call or the acceptance support that expect and fab to customer agree convert grand a especially, to

and half automotive required one one year somewhat year. And or

to take us into while very is able capacity continue run bringing don't so product want for TI, to critical to the support or our And a be of time is we we capacity problem so it's empty really to wasting.

Shawn Harrison

so Got you. much. Thanks

Operator

Thank you.

Gerra of Our question Baird. comes from next Tristan

is open. line Your

Tristan Gerra

Hi, corporate good to offering TI. average? fab on profile business margin for question afternoon. them, Follow-up that is foundry the that the you're this What's from below

Keh-Shew Lu

we I agreement of the time No, going accretive operation and say I TI, like disclose immediately, with Tristan, detail the disclosed, to have cannot. I okay. more cannot we it's one cannot but am emphasize

Tristan Gerra

access And then, years your get to fab How fab, full Okay. bring going what does a once to that few increase that once is you full incremental percentage much this to capacity relative presumably current access wise give total you you production few today? have percentage years? in

Keh-Shew Lu

loading This I of and give but still some - of X-inch probably the cannot today the thing now from agreement is will fully any key we But Diodes the additional cannot the fully will the too accretive do gain much I loaded say be additional have X-inch I you detail, it I is almost really with not not be can any is to gain. loaded. Therefore we're like able immediately.

too will loading probably for of detail. show I how more able Right. disclose you cannot much much are the sure. Now, because profit, we that's then But gain be to from tell Diodes

Rick White

put per in layers the equivalent months we XX,XXX is approximately which plus over one And month. of GPAD wafers thing total Yes, press approximately XXX,XXX what if release, capacity we capacity that X-inch process, can X-inch that's per disclose wafers go through X,XXX currently the so capacity. per you the and Tristan, month has of whole X-inch

Keh-Shew Lu

wafer, product used in I why wafer layer. layers different a XX CMOS are probably not much less, give and is is the to which wanted wafer, when XX And layers the that's talk all of to XXX CMOS and of for the using our like you much for higher, product Diodes same XX average is instead X,XXX use traditional discrete, in mention layer especially for product total to layers, but layers number in is wafer SBR the is that's we much, why the month reason about of X,XXX use way I number a to and that's and typically MOSFET

Tristan Gerra

then quick than Okay, capacity too on that a what you type you over. order And are of that's an to last able Chinese year you activity the you have, Chinese relative is And or question. is capacity bit you the expected. week now it up starting backend post Year to therefore that New early initial coming earlier had Year Is this more labor specifically that New probably useful. you see from do back demand follow-up shaping had and Chinese Year? How little more with basically expected New

Keh-Shew Lu

Tristan, we of a Year actually that give New guidance the in today Chinese Okay. ago. see can over you the couple just days

already And so, during the we is week, New do Chinese Chinese, And last Sunday, over people already is know week. means how the last Year Sunday. which many come Year back New last

So we consideration give the guidance supporting. and that guidance is already in of the the capacity,

the a is big from that to Year. performance the return point not Chinese be New anymore. and people guidance surprise My people think reflect so I the And going

Tristan Gerra

you. Okay, thank

Operator

next of of comes [Operator Edgar Roesch Instructions] line Our Sidoti. question from the

Your line is open.

Edgar Roesch

finishing terrific Yes. a Congratulations year. up on

Keh-Shew Lu

you. Thank

Edgar Roesch

be bit assume traditional going wanted you whether would and more And it's quarter automotive first side. systems steering, slower. newer a like to into here? great. I applications. growth or is driving little what the this the in good throughout Well, just systems, growth connected you're And But power alike bit I XXXX? that would Certainly could trended premium speak some how on windows about, a ask seen the automotive seeing being ADAS you

Emily Yang

Right.

let is address the this maybe Emily, So question, right. me

the like power traditional like that you the mentioned, the windows some with even of stuff and So that. applications steering,

We a content seeing lot lot emphasizing the been that implemented start which also there of a especially change on of for last we've this over few brushless side. see diode change quarters, the DC motor with and we improvement,

really seen. we've what So that's

content and of switching now, newer it we've models, kind really functionality traditional to about. function, really enriched expansion lot but a that the of talking the same the features helping So is the been even from

Edgar Roesch

years for Thanks a that that. that up see couple faster adequate? than revenue X% do Lu, or just budget mix say, more terrific. grow maybe we continue of R&D Okay, to the into being would at point? devices, to in expect the future, And some Let's complex little Dr. you then as you a

Keh-Shew Lu

I when XXXX always intend remember remember that And is to motto discrete about to to forget X% the that And driving I both both don't our is the X%. probably to building but print R&D analog. of numbers, talking number You the we we're $X.X go and you two of X% same R&D revenue you'll XX% billion R&D is, say GP on up more, about, have to hoping talking do okay? the increase on is growth total same we're [ph] XX% that and

So keep as revenue discrete, R&D the same the the growth. we'll

don't And need X%. see a Yes, increase think, I so our X% our significant X%. model. X%, R&D from business And from I - of therefore,

is So, key is and increase of use the efficiency really good the R&D think the in money. thing I a it that

to been money. R&D Okay. driving I've I'm doing, how in effectively more to use

far And Pericom - last GP. able product Pericom and purchased speech efficiently Pericom so in take frequency in Diodes year. increase thing already money. the XX% I XX% that IC, increasing actually now you talking of is our IC efficient another our XX%, the their to product using R&D control And of And and IC, in we know Pericom you Emily Pericom, XX% our am the IC, if IC grow increased about control Pericom, product

are that grow we we are year. XX% money, you and R&D the So can not see that the we to same last about even able increasing with keep

think our I money. are very we R&D answer your to to well question, So utilize

Edgar Roesch

it prescribed the kind And the Yes, I structure? one, expansion for was investment in geared you understand Chengdu change or towards one the additional then ownership last that is eventual it agreement. Is any just that. in equity of kind of thank

Rick White

investment that we to the the Chengdu, spend What's the talked on in future talking expansion? about fourth quarter. He about equity that be in going is

Keh-Shew Lu

have Okay, constantly that we one is do expansion. support for - to we the CapEx items, two increase need capacity our

Now we another the building. money still continue, the is big

building. are remember manufacturing [ph] we of Chengdu we building you building. one If we majority of the our build and R&D X building, at one And when manufacturing up using beginning one the up painting phase all kind

going fully one to that manufacturing a think next And there go to plan do a building our can see consume phase, money try the and another of to little we and on the our is five So, utilize building space we just am to floor see I floor. big expansion. bit which is

next and have ongoing to up it's building still the manufacturing a So, we we start need when building. will

Edgar Roesch

evening. that Thanks Thanks. good and have for a

Emily Yang

Thank you.

Rick White

Thanks, Ed.

Operator

this Thank over I'd you. Lu? to to Dr. call any for like Dr. remarks. At the turn Lu, time closing

Keh-Shew Lu

Thank you for your on call. participation today's

on We next business update forward quarter. disconnect. providing another you our are may looking now Operator, to

Operator

participation and day. you this for Thank conference. you, Thank wonderful Ladies your sir. have today's a concludes and gentlemen

may at lines disconnect time. your You this

Diodes (DIOD) 13 Feb 192018 Q4 Earnings call transcript