Logo
Log in Sign up


← Back to Stock Analysis

Earnings Transcript for 6857.T - Q3 Fiscal Year 2023

Yoshitake Kobayashi: Thank you very much for attending today's briefing on Advantest Corporation's Financial Results for the Third Quarter of Fiscal Year 2023. I would like to introduce the company's attendees today
Yasuo Mihashi: I'm Mihashi. I will present the financial results. Please turn the page to four, on the third quarter result for FY 2023. The third quarter sales and profits exceeded those of the second quarter. Unfortunately, as you can see, they are still trending in negative territory year-on-year, but signs of recovery are starting to emerge. In the area of generative AI, sales grew by responding to robust demand for memory testers. In addition, sales of testers for some high-performance SoC semiconductors and system-level test increased quarter-on-quarter. Details will be explained sequentially in the following pages. Let me move on to the next page, on FY '23 third quarter sales by segment. Regarding the third quarter of fiscal year 2023, all segments recorded an increase in sales quarter-on-quarter. Regarding Semiconductor & Component Test Systems, SoC tester sales were ¥63.3 billion, almost flat quarter-on-quarter. Sales for mature processes such as automotive and industrial applications decreased quarter-on-quarter, as there was a lull in customer investment after an elevated level of delivery up until the previous quarter. On the other hand, for advanced processes, an increase in sales for application processors in addition to high-performance computing offset a decrease in sales for mature processes, although such increase in sales does not represent full-fledged recovery. Memory tester sales were ¥25 billion, an increase of ¥6.2 billion quarter-on-quarter. Sales for high-performance DRAM for generative AI increased. For Mechatronics Systems, sales of device interface product increased in tandem with an increase in tester sales. Regarding service, support and others, in SLT business, sales increased for high-end SoC. Please turn to next page, on FY '23 third quarter sales by region. As you can see for Taiwan, in addition to a large increase in sales of SoC tester sales for high-end SoC, sales of SLT increased. Regarding South Korea, while SoC tester sales declined, memory tester sales increased mainly for DRAM. As a result, total sales remained elevated as in the previous quarter. Regarding China, despite a decline in sales for high-end SoC, the overall level of sales remained at high level. Please turn to the next page, on sales, gross profit, and operating income. While sales increased quarter-on-quarter, gross profit margin increased only slightly quarter-on-quarter. SG&A increased ¥3.5 billion quarter-on-quarter. However, second quarter includes approximately ¥3.2 billion of other incomes which includes settlement income. Therefore, SG&A was effectively on par with the second quarter. Now, if you turn to the next page, investments and cash flow. R&D, CapEx and D&A remained on par with the previous quarter. On cash flow, free cash flow was an outflow of ¥7.1 billion due to payment of bonuses and income taxes based on FY 2022 income. Now, if you turn to the consolidated financial position, inventories remain at an elevated level and supply capacity expansion is being implemented for businesses with robust demands such as high-performance memory, while responding to requests for push-out from some customers in other businesses. On the liabilities side, taking into account the working capital needs, we have taken on additional debt funding. In order to monetize inventories as quickly as possible, we will make effort to refine our supply chain management. That's all.
Yoshiaki Yoshida: Next, I would like to talk about the FY 2023 outlook. Now, please look at Page 11. Business environment, semiconductor tester market trends. I would like to share with you current outlook. Now, calendar year 2023 semiconductor market was more sluggish than expected. Due to delayed recovery of a major consumer electronics appliances such as smartphones and PC, ramp up of tester demand, which was expected to take place in the second half of calendar year '23 in our initial forecast as of the beginning of calendar year '23, has also been delayed. Therefore, we estimate calendar year '23 SoC test market size to have been between $3.3 billion to $3.4 billion. In calendar year 2024, we expect demand ramp up to take place in the second half, led by high-performance semiconductors such as HPC and AI. We estimate calendar year 2024 SoC tester market size to be between $3.3 billion to $3.6 billion. We estimate calendar year 2023 memory tester market size to have been approximately $1.1 billion. In calendar year 2024, we estimate memory tester market to be between $1.3 billion to $1.6 billion. While non-volatile memory is expected to gradually show tester demand recovery from the second half of the calendar year '24, high-performance DRAM tester demand is likely to ramp up rapidly and stay active throughout the year in tandem with customers' increased production plan and rising quality assurance requirements. We estimate that our market share for both SoC testers and memory testers have reached the upper 50% range in calendar year 2023. Now, please turn to Page 12, FY 2023 forecast. Based on the performance in the first nine-month period and an outlook for fourth quarter, we are revising up our full-year consolidated forecast. Sales forecast is revised up by ¥10 billion to ¥480 billion due to factors including increased demand for memory testers. Gross profit margin forecast remains unchanged from the previous forecast of approximately 50%. Operating income forecast is revised up by ¥5 billion, as there is no change in the forecast for SG&A. Exchange rate assumptions for fourth quarter are ¥145 for the US dollar and ¥155 for the euro. Our latest forecast for the impact of exchange rate fluctuations on FY '23 operating income is plus ¥0.8 billion per ¥1 of yen depreciation versus US dollar and minus ¥0.3 billion per yen depreciation versus the euro. Due to the expected decline in sales from the US dollar-based transactions, we have lowered our sensitivity estimate for the US dollar by ¥0.1 billion from October. Please turn to Page 13. This is the outlook by segment. Let me explain the outlook for the Semiconductor and Component Test System for FY '23. FY '23 SoC tester sales forecast is ¥244 billion, which is ¥4 billion lower compared to the October forecast. For advanced processes, demand recovery is gradually observed. On the other hand, for mature processes, such as automotive and industrial applications, the level of tester delivery, which had stayed elevated, appears to be taking a pause toward the second half. For advanced processes, despite customers production for increased demand in areas such as generative AI, which are gradually prompting the digestion of excess tester capacity, full-fledged recovery of tester demand is likely to take a while longer. FY '23 memory tester sales forecast is ¥81 billion, which is ¥5 billion higher compared to the October forecast. In high-performance DRAM applications such as HBM, which is related to generative AI, robust demand is expected against the backdrop of medium-term demand growth and high reliability requirement. In order to respond to such demand, we are working on expanding our supply capacity and have raised our sales forecast. Please turn to Page 14. This is the outlook for Mechatronics System for FY '23. The sales forecast is revised up by ¥5 billion compared to the October forecast. Owing to an upward sales revision of memory testers, sales forecast for related device interfaces is revised up. FY '23 services, support and other sales forecast is revised up by ¥4 billion compared to the October forecast. For maintenance services, solid demand is expected due to the steady growth of our installed base. System Level Test business is expected to be flat year-on-year due to the impact of specific customers' investment trends affected by the sluggish semiconductor market conditions. Going forward, we will pursue a medium- to long-term sales growth as well as profitability improvement as we move forward to provide solutions and expand our customer base into areas such as for HPC or AI where we can expect adoption of the System Level Test. Please turn to Page 15. This is the summary. We have been expanding our supply capacity structure in response to tester demand growth for high-performance memory. We have revised up our sales forecast by ¥10 billion from the October forecast of ¥470 billion. On the other hand, recovery of SoC tester demand is slower than expected. While tester demand for high-performance semiconductors such as HPC and AI is turning upward, digestion of excess tester capacity is taking longer than originally expected at the beginning of the fiscal year, although signs of recovery are emerging. In 2024, supply-demand balance improvement of semiconductors is expected. In addition to demand recovery of semiconductors for consumer applications, increasing demand of semiconductors and capacity increases on the supply side for generative AI is expected to lead to related CapEx and drive tester demand in the second half. In the mid- to long-term, as generative AI technology advances, structure of industries as well as society at large are likely to change. We aim to expand the scale of our customer base by grasping changes in the semiconductor value chain and providing new solutions in order to pursue further growth. Finally, I would like to touch on profitability improvement. Changes in the past year were significant. However, semiconductor demand is likely to continue to fluctuate going forward. We will work to refine our supply chain management to improve our responsiveness to demand fluctuations. The basic approach to improving profitability will be through the provision of higher value-added solutions in response to technological evolution of new high-performance devices. In parallel, we will review the selling prices in light of rising materials procurement costs and strengthen our cost reduction activities. This concludes my explanation. Thank you for your attention.
Yoshitake Kobayashi: We will now begin the questions-and-answer sessions. Questions can be raised in the following manner. Please click on the Raise Hand button that appears when you click on to the participant icon on the Webex screen. When you are nominated by the moderator, the Unmute selection button will appear. So, please unmute yourself before speaking. Please identify yourself with name and affiliations and state your questions. Please note that we would like to answer as many questions as possible from the participants and please limit your questions to one per person. If there is still time, questions will be accepted until the schedule end of the session. Please be sure to speak slowly and concisely when stating your questions, as we will be providing simultaneous interpretation in English and in Japanese. Please refrain from asking questions about individual companies. Questions can be raised either in English or in Japanese. We will now begin the Q&A session.
A - Yoshitake Kobayashi: First, Morgan Stanley MUFG, Wadaki-san, please. Wadaki-san, can you hear us? We will come back to you later. Well then, Yoshida-san from CLSA.
Yu Yoshida: Can you hear me?
Yoshitake Kobayashi: Yes, we can hear you.
Yu Yoshida: Thank you. Slide 11, tester market, I have a question. FY '24 outlook has been presented. Thank you very much. If possible, SoC tester, memory tester, for each, if you have the breakdown for FY '23 and FY '24? Could you explain your view particularly regarding SoC, HPC customers -- for computer customers, mobile customers, what's your prospect for the market? And for memory, DRAM particularly, HBM composition, will that change from FY '23 to FY '24? Based on that, what is your prospect of the market share for FY '23? You said that it's around 50% for both. Toward FY '24, what is the forecast, and as well as what's your view of the gross profit? Thank you.
Makoto Nakahara: I'm Nakahara, in-charge of sales. Let me respond. Page 11, FY '24 -- calendar year '24 estimate are provided. SoC first, $3.3 billion to $3.4 billion for -- the projection for this term. We expect a slight growth as was mentioned during the presentation, generative AI-related logic device. Tester demand is the area where we believe the growth is coming. Regarding SoC tester, at test house and/or at OSAT, tester utilization, if it's on the full utilization of the new device to be a purchased. That is the business model that we have. Therefore, with the utilizations has heightened, however, it is not at the full capacity for utilization yet. From the second half of 2024, for large logic device tester, we believe that the growth can start to emerge. So, SoC tester for 2024, AI/HPC-related logic device with the area that will become a big business for the company. At the same time for calendar year 2024, in the latter half, smartphone-related customers, application processors customers, they've been shifting to the new process node. I believe that it is highly likely. Therefore, the smartphone-related demand was slowing down. However, starting from the second half of the calendar year 2024, we may see some movement. And on another point regarding memory, high-performance, high-end DRAM, DDR5, [HDDA] (ph) for calendar year 2024 will become a very big market. At the same time, toward the second half of the year RAM-related business, to a certain extent, can recover, and it can come closer to the upper end of this $1.6 billion. So, HBM may be the main business. Now, talking about the market share for calendar year '23, both for memory and SoC, 50% high, 50% is what we have stated. Now, for calendar year 2024, same level of market share can be secured and maintained.
Yasuo Mihashi:
,:
Yu Yoshida: Thank you for your response.
Yoshitake Kobayashi: Thank you very much. Next, from Goldman Sachs, Mr. Nakamura, please.
Shuhei Nakamura: Hello? HBM tester is my question. So, sales -- memory tester sales was upgraded. That is because of the increase in for HBM tester. Three months ago or in November, there was IR Day. And in comparison to that timing, demand outlook for HBM testers, how has it changed? As to the sales increase revision, is it because of the demand increase? Or is it because of the manufacturing volume increase of yours? Can you tell us that as well?
Yoshitake Kobayashi: Yoshida is going to answer.
Yoshiaki Yoshida: As of around November, already for HBM, demand started to increase. Toward the end of the year, the plan, looking at the following year was fixed among our customers and the outlook for the next full year forecast was given to us by our customers. And according to that, in comparison to the outlook in September and October, there was further elevation from that time. And as for our supply ability, memory testers are manufactured in Japan and how we want to improve the supply capacity of that is one of our challenges. In order to fulfill all the demand increase in the market, we need to make further efforts. Having said that, what I would like you to be cautious about is demand change could always occur. So in our manufacturing, we want to levelize things as much as possible. And at the same time, we want to fulfill the customers' manufacturing plan. So, to the next full year, we want to improve our manufacturing capacity. At this moment, we are not at the stage that we are able to provide sufficient supply. So though we see an increase in sales, but because of the constraint of the manufacturing or supply, the situation is as such. That's the reflection of the reality.
Shuhei Nakamura: Thank you very much. As a follow-up question, what you said is you have visibility up until next year means up to 2025, you have some business inquiries for the manufacturing. Is that the correct understanding? And at the time of IR Day in November, for HBM tester sales toward the next fiscal year versus previous year, so I understand it's increased by 50% or double. Hasn't that been changed?
Unidentified Company Representative: So, when you say double, it may be too much of an assumption, but September, October, November, in comparison to our estimate back then, it could be possible. The amount could be double. And looking at the year 2025, we don't have a clear visibility. But until the end of 2024, we have visibility that the level will be staying at high, which will roll over to 2025. But until what time in 2025 will that continue? We don't have a clear visibility, meaning that at our customers' level, they don't have that much plan.
Shuhei Nakamura: I understand it really well. Thank you very much.
Unidentified Company Representative: So, supplementary comment at the time of memory explanation meeting, what we said is the following. HBM market in terms of CAGR, 50% per year, meaning that as for next year, about 1.5x, the following year, about 2x or double. That's what we communicated. This is a supplementary comment. Thank you very much.
Shuhei Nakamura: Thank you very much.
Yoshitake Kobayashi: Hirakawa-san of BofA Securities. Please go ahead.
Mikio Hirakawa: My name is Hirakawa from BofA Securities. I have a question about SoC testers. In the fourth quarter, SoC tester sales, I believe if you do the math, it is ¥57.1 billion, and this is a plan dropping from the second and the third quarter. And in the fourth quarter, I believe it is supposed to go up, but it is actually coming down. I think it is related to the mature nodes. So, can you please explain the reason? Also, I would like to confirm one thing. As I was listening to you, recovery expected at the time of previous briefing is going to be delayed by six to nine months. And I believe the situation is still the same from three months ago. Is there anything that you can elaborate on, on this matter? Thank you.
Yasuo Mihashi: Hirakawa-san, this is Mihashi speaking. Thank you very much for your question. Towards the fourth quarter, the number for SoC testers seems slow. I believe that is your question. And I believe you have done the math. And as you saw in the fourth quarter, SoC is weaker compared to the third quarter. Normally, in the second half of the calendar year, our SoC customers drive smartphone-related demands. That is normally observed. However, as you all know, smartphone business in the recent situation is becoming weaker. Therefore, normally strong numbers come out for the fourth quarter on a Q-on-Q basis, but that is not the case this year. And related to smartphones, well, there were opportunities, businesses that were pulled up from the fourth quarter. However, the continuation of those opportunities are not guaranteed at this moment.
Mikio Hirakawa: Thank you. SoC tester market recovery is expected to be delayed by six to nine months. Hasn't that changed since three months ago?
Yasuo Mihashi: I believe that is being pushed out to a certain extent.
Mikio Hirakawa: Can you please elaborate on that?
Yasuo Mihashi: As we explained during the briefing, well, this is related to what Nakahara-san said earlier, computer communications and automotive breakdown, if you compare those two, automotive and consumer products were stronger in the third quarter, but they are becoming weaker, and smartphone-related business has been pushed out or have been becoming slower. That is pushing up the expected recovery of the SoC tester business.
Mikio Hirakawa: Thank you.
Yoshitake Kobayashi: Thank you. Next, Jefferies Securities, Nakanomyo-san.
Masahiro Nakanomyo: Hello? This is Nakanomyo from Jefferies. Can you hear me?
Yoshitake Kobayashi: Yes, we can hear you clearly.
Masahiro Nakanomyo: Thank you. System-level testing third quarter, the sales increased considerably. But on a full year basis, you have revised downwards of the forecast. What are the situations as well as the forecast for next year?
Douglas Lefever: Yes, I can take this question. Thank you. As far as the SLT business goes, we've experienced, because of the downturn, particularly in mobility a little bit of softness, but we've seen some level of recovery in the recent quarter, both from some capacity buys as well as new customers. And then also, we've seen an emergence of some compute level requirements for system-level tests. So still, year-over-year, we expect the situation to be relatively flat but we're encouraged by some of the things we've seen in the past quarter.
Masahiro Nakanomyo: What is the forecast for the next fiscal year?
Douglas Lefever: Next fiscal year, it's still uncertain. But as we see mobility come back, that should drive capacity purchases that are key mobility customers. And then, as in the remarks, we've seen some HPC opportunities come into SLT insertions for extended coverage and for yield improvements. So, difficult to say as it is a very dynamic situation. But long term, we still feel that the SLT insertion will continue to grow.
Masahiro Nakanomyo: Thank you very much. Now, based on what you have mentioned, for 2024 overall, how do you view the next year? Previously, initially '24 will recover to the 2022 level. In the previous briefing, you mentioned that it may be slightly delayed. What is your perspective for next fiscal year? Any general image, general view toward the next fiscal year?
Yasuo Mihashi: 2023 recovery started. And in 2024, should recover to the 2022. That is a scenario that we talked about in the past one year. However, recovery in 2023 is not as high as we expected. There is a push up. That is the actual situation we are in. However, what will happen in 2024 centering on AI. In other words, supply capability of AI would go up considerably. Demand is there. However, the supply is not catching up, and with the improvement in that front, SoC and memory, I believe that the demand itself would increase. Therefore, for 2024, if we reach a higher range of outlook, ¥5.2 billion or maybe the level, which is the level of the 2024 combining the memory and the SoC tester, but the SoC tester was still weak, and the memory is showing more robust recovery. So, for the entire tester market, there is the opportunity to recover to 2022 and 2024. However, the memory tester, even if it becomes stronger for the profitability, we may not be able to catch up. And that is a challenge of our company.
Masahiro Nakanomyo: Understood. Thank you.
Yoshitake Kobayashi: Moving on to Nomura, Yoshioka-san, please?
Atsushi Yoshioka: Can you hear me?
Yoshitake Kobayashi: Yes. Hello.
Atsushi Yoshioka: Thank you. Yoshioka from Nomura. Away from the earnings results, I would like to ask questions of my concerns. North American biggest competitor of tester with a large probe card manufacturer, they formed a partnership that was what happened in November last year. To your business, moving forward, what are the possible impact in the mid to long term -- in the short term and midterm? And what kind of actions or policies are you going to have on this topic? Can you share with us your view?
Yoshitake Kobayashi: Doug in the US is going to explain.
Douglas Lefever: As far as the impact that we'll see that the discussions we've had have been confidential. But the policy we have is that there's an open ecosystem for testers and for probe cards. That's the understanding that we have with the probe card suppliers, it's the understanding that our customers have with us as well as the probe card suppliers. So, we're confident that even though our competitor has made an investment in one of our partners that there will be no effect. So, we have confidence in that point.
Atsushi Yoshioka: Thank you very much. I understood. So, if I may do supplement the probe card is used together with tester. So installed the unit of tester when there is a more installed tester then the amount they use for probe card also increases, so the investment by competitor. When they do business with us?
Unidentified Company Representative: No, that's not the case. So our customer when they use our tester, then it's natural that the transaction will be made with them. And when a competitor having interest in consumable business, as mentioned in our grand design, that is looked from a total solution, it seems our competitor is thinking the same thing as us. So, by observing the competitors' movement, we also have to think about the way of our business.
Atsushi Yoshioka: Thank you very much for your comment. I understood. Thank you very much.
Yoshitake Kobayashi: Thank you, Yoshiyoka-san. Next, We were not able to connect well with Morgan Stanley, Wadaki-san. Can you hear us all right? Wadaki-san, have you joined? Well, I believe we can come back to you later. Shimamoto-san of Okasan Securities. Please go ahead.
Takashi Shimamoto: This is Shimamoto speaking from Okasan Securities. About SoC testers, in the second half of 2024, recovery is anticipated. So, it has been pushed out. But regarding the timing of recovery, to what extent do you have visibility? For example, from receiving orders to delivery, I believe the lead time, if it is six months, then recovery in the second half will have fair probability, I would think. So, the timing of recovery, is there any risk of being pushed out even further? How are you looking at the situation?
Makoto Nakahara: Then I would like to answer your question. The lead time of testers has come back to a normal level. It depends on the model and configuration of course, but it is between two to six-month timeframe. So, market recovery is not anticipated in the second half just because of the lead time. But what we are monitoring is the utilization rate of our testers installed in the market. According to the recovery of the utilization rate, well, if we look at the installed testers, configuration has changed from smartphone to HPC AI, for instance. Such trend is occurring, and that is leading to improvement of utilization rate. When the utilization rate peaks out and larger configuration SoC testers demand will be recovering in the second half of the year, that is our expectation. Since the previous financial results announcement, maybe you are feeling that it's slightly pushed out further. But as Mihashi-san said, automotive industrial-related SoC tester demand is slightly weaker. And that may lead to potential adjustment of the timing. But when it comes to the probability, well, I have to say that the market changes constantly. So we don't have a full visibility. But depending on my experience and depending on customers' plan for next devices, we are trying to develop our plan.
Takashi Shimamoto: Thank you. I have a follow-up question. If possible, the situation of utilization rate three months ago, six months ago, and today, how has it been trending? If it is possible, can you please share it with us?
Makoto Nakahara: Well, it is difficult to give you concrete numbers. But in around spring, I would say, in April, the utilization rate was quite low, and it was the bottom. But compared to six months ago, the situation is improving. The peak is at around 90%. However, it's going to take a while longer to reach that level. That is the current situation.
Takashi Shimamoto: Thank you. That is clear. Thank you. That's it from me.
Yoshitake Kobayashi: Thank you. Next, Daiwa Securities, Sugiura-san.
Toru Sugiura: I'm Sugiura. Thank you. Regarding the SoC tester, particularly the market outlook for high-end SoC tester, in the second half of the year, high end, HPC around smartphone, you expect to see the recovery. That's what you had mentioned. And if this has been expedited and front-loaded, what may be the trigger for that? Take, for example, PC and smartphone without the recovery in the volume and if there will be the expedited schedule, what may be the trigger? Do you have any ideas on that?
Yoshitake Kobayashi: Yoshida will respond.
Yoshiaki Yoshida: The possibility of front-loading of the schedule, what we are closely monitoring is the supply side. The demand is there. AI chip itself, but we are not manufacturing the amount that is required. Foundry, the largest foundry has increased the production from January and it is constantly going up. And I don't think it is highly likely that the schedule will be front loading. However, if the capacity increase will proceed in-line with the plan, and then sometimes in June and in July, they can reach to a ramp-up stage to increase the production. The testers, there may be some shortfall in the testers that is up and running. But for mobile, can it be further reactivated? We don't -- we cannot say that for certain. Take, for example, what was announced by Samsung, AI chip to be incorporated into the mobile phone. And if that will further spread. So, set a new product that will be launched in a larger volume, then there is a possibility that the things will be front-loaded. However, that we have not seen a sign of that.
Toru Sugiura: AI for the mobile device is what you have mentioned. Now even without the increase of the numbers of the unit for mobile, with the enhanced feature of the AI, then there will be the increase on the bottom demand. Is it correct to understand that?
Yoshiaki Yoshida: Well, yes, that is what we expect, inclusive of the possibility of the new entrant.
Toru Sugiura: Thank you.
Yoshitake Kobayashi: Thank you, Sugiura-san. Next, so we had a connection issue. Once again, Morgan Stanley MUFG Securities, Wadaki-san. Hello?
Unidentified Company Representative: So, there is noise. [indiscernible] So I was not able to hear you clearly at the beginning. What were you asking? About what did you ask? Did you say AI? AI smartphone, did you say? Wadaki-san, can you repeat? Maybe you are on the mute. Wadaki-san, can you hear us?
Tetsuya Wadaki: I can hear you. It's about AI smartphone. Can you elaborate on AI smartphones?
Yoshitake Kobayashi: So, AI smartphones. Doug-san, can you respond?
Douglas Lefever: I didn't quite catch the question, but I think it's referencing AI smartphone. And what I can say, everybody is hopeful that there's going to be new applications in handsets using AI that will drive a new replacement cycle for phones. Already, most of the APU manufacturers have built-in AI course into the AP. So, capabilities are in some of the phones already and the use cases are what's coming. So, it's been very public from many CEOs in the industry about the need to do more edge compute using AI because of a lot of the power consumption, privacy, workloads. And so, we see that coming. And when it does come, that's going to drive a lot of volumes. So, in the time right now, we've seen pivot from mobility into HPC that is digesting a lot of capacity in the cycle. And then on top of that, there's going to be the addition of mobility and consumer using AI at the edge, which should drive some very, very large growth for the industry.
Yoshitake Kobayashi: Did that answer your question, Mr. Wadaki? Most probably, he was able to hear us. So, sorry. So, we would like to conclude our answer. Thank you. Now, we are almost at 5 p.m. So, I would like to take the last question from the ones raising their hand. Yoshida-san of CLSA. Please go ahead.
Yu Yoshida: Thank you. This is my second time. Thank you for this opportunity. I have a question about the market share outlook for 2024. In 2024, in SoC AI, HPC, and application processor and the memory and tester, DDR5, HBM demand are expected to grow, especially in the second half according to your explanation. These applications have a relatively high market share of advantage. So, I think we can anticipate a further growth, not flat year-on-year. But do you think you can realize the growth higher than the market growth in 2024?
Yasuo Mihashi: Thank you, Yoshida-san for your question. Regarding the market share, it is not easy to give you a direct response. The two companies are dominating the market. However, there are other competitors, too. We have high 50% market share. And it is not easy for us to say we will aim at even higher market share. But according to the market situation, there's HPC and HBM, high-performance semiconductor testing demand, which are our strength. And there is high expectation for our company. That is true. However, setting a concrete target for market share, we're seeing that explicitly is something we choose not to do in order not to offend other competitor.
Yu Yoshida: Then I believe that is still a possibility, right?
Yasuo Mihashi: Well, looking at the customer base and our product portfolio, we believe there is a fair probability. That is my personal view.
Yu Yoshida: Thank you. That's it from me.
Yoshitake Kobayashi: Thank you. We have used up all the time available for Q&A session. Thank you very much for raising questions with us. We would like to end fiscal year 2023 third quarter of financial briefing for Advantest Corporation. Thank you very much for your participation.