Macronix International Co Ltd

TWSE:2337

Earnings Call Transcript 2019-Q4

[Operator]

Ladies and gentlemen, thank you for standing by and welcome to the Macronix International Fourth Quarter 2019 Earnings Conference Call. [Operator Instructions]

Please be advised that today's conference is being recorded. The presentation and discussion contains certain forward-looking statements with respect to the results of operations, financial condition and current expectations. The forward-looking statements are subject to known and unknown uncertainties and risks that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new technologies, ability to ramp new products into volume, industry-wide shifts in supply and demand for semiconductor products, industry overcapacity, availability of manufacturing capacity, financial stability in end markets, and other risks. The forward-looking statements in this release reflects the current belief of Macronix as when of the date of this release, and Macronix undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such date.

And now I'd now like to turn the call over to your first speaker host today, Dr. C.Y Lu, President of Macronix International Company Limited. Thank you, sir. Please go ahead.

[Chih-Yuan Lu, executive]

Okay. Hello, everybody. I am C.Y. Lu. Welcome to today's Macronix International Online Investor Conference. I will just make a financial highlights for you to summarize our results. As you see from this first slide, and you can see our fourth quarter 2019, our revenue is NT$ 9,581 million, our gross margin 26%, and operating margin is 8% as compared with quarter 3, and last year, quarter 4, that's Y-on-Y and Q-on-Q, you can see it's obviously less here. Compared with the third quarter, gross margin and the operating margin is -- both decreased as the season -- as you can see in the quarter 4 from 2018. And also, we have reduced on the wafer start in order to reduce our inventory. So those are the reason this is low, reason -- and are reducing reason, compared Y-on-Y it's about same.

Okay. Next slide, a highlight. Since this fourth quarter, so I highlighted year over last year, 2019 versus 2018. The revenue is NT$ 34,995 million and compared with 2018, it's a 5% decrease, okay? And this is due to the -- major due to the pricing, and the pricing is due to the Sino-American's argument about the trade, okay? And the gross margin is certainly reduced, due to ASP. And the operating margin is now safe, reduced because our operating is -- used about 20%. So 28% became 9% and 38% became 18%.

So this is my financial highlights. I will invite our CFO, Paul Yeh, to give you in more detail finance numbers and information, and I will summarize you with business development. Okay, Paul.

[Pei-Fu Yeh, executive]

Okay. Thank you, C.Y. This is Paul Yeh. Welcome to join the -- our this quarter's press release. I'm going to present our consolidated statement quarterly and yearly. And for the explanation, I would like to use Mandarin for -- from now. [Foreign Language]

[Chih-Yuan Lu, executive]

[Foreign Language]

[Pei-Fu Yeh, executive]

[Foreign Language]

[Chih-Yuan Lu, executive]

[Foreign Language]

[Pei-Fu Yeh, executive]

[Foreign Language]

[Chih-Yuan Lu, executive]

[Foreign Language]

Operator, do we have any telephone Q&A? Questions?

[Operator]

We currently don't have any telephone questions, please continue.

[Chih-Yuan Lu, executive]

Okay. I give another because we already answered a lot of question from text. And I give another 30 seconds. If there is no answer, we will close today's meeting.

Okay. Thank you, everyone.

Thank you for your interest about the Macronix. And then, we completed today's investor conference. Thank you very much.

[Pei-Fu Yeh, executive]

See you next quarter.

[Chih-Yuan Lu, executive]

Yes, see you next quarter.

[Operator]

Thank you. Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may all disconnect.