Paulman Wang

Paulman Wang inquired about the reasons for the lower-than-expected March quarter gross margin guidance and the path to the 30% long-term target. He also asked for specifics on the R&D programs funded by the Chongqing JV stake monetization and the revenue scale required for operating leverage.

Answer

CFO Yifan Liang attributed the March quarter gross margin decline to lower utilization, especially during Lunar New Year, expecting a rebound in the June quarter to prior levels. He reiterated the midterm target of $1 billion revenue, 30% non-GAAP gross margin, and 20% OpEx, driven by new products, better mix, and a normal pricing environment. CEO Stephen Chang specified R&D investments are focused on AI opportunities (expanding product breadth and customer base), PC total solutions, and smartphone battery protection, with bigger impacts expected in 2027.