Q2 2024 Phison Electronics Corp Earnings Call Transcript
Key Points
- Phison Electronics Corp (ROCO:8299) reported a significant year-over-year revenue improvement of 70.5%, reaching $15 billion.
- The company's enterprise segment grew from 5% in CQ1 to 14% in CQ2, indicating a strong shift towards enterprise storage solutions.
- Phison's gross margin improved to 34.86%, with a potential increase to 35.3% after accounting for inventory write-downs.
- The company launched its aiDAPTIV Pro Suite, attracting interest from Tier 1 server makers and receiving an award for Most Innovative AI Application.
- Phison's investment in high-density enterprise storage solutions, such as the 64 terabyte and upcoming 128 terabyte SSDs, positions it alongside major players like Samsung.
- The retail segment remains weak, with Phison expressing no interest in following the low pricing trends, leading to a decline in retail revenue.
- The company faces challenges in the NAND market, with high prices impacting the enterprise business and retail prices being described as 'bloody'.
- Phison's EPS slightly decreased due to an increase in total shares from a treasury share issue in CQ1.
- The company is experiencing a slowdown in consumer demand, particularly in the PC OEM and smartphone markets.
- Phison's inventory levels remain high, with concerns about maintaining sufficient inventory amidst fluctuating NAND prices and market demand.
Good evening, everyone. My name is Jeff Ohlweiler. I'm Head of Research at Macquarie. Very happy to be hosting Phison's second-quarter conference call.
I'm just an amateur NAND enthusiast, so I'll turn it over to a professional, KS Pua, CEO. KS will do a presentation, and then I'll lead the Q&A after that.
KS, over to you.
Yes. Jeff, thanks to you and thanks to everyone to participate in our CQ2 '24 earnings call. Okay. This is a breakdown of our CQ2 revenue. From this chart, you can see consumer wise.
Actually, in the May, in CQ1 earning call, I already emphasized the retail is very weak. We have no any interest to follow the price, total loss in the retail. So the portion of retail will decline a lot because I have no intention to go there.
Controller wise. The reason is that last year's CQ4 and Q1, our NAND company, as the customers, they're putting a lot of controller to get the major share in the
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