Hello, and welcome to the Soitec Fiscal Year 2025 first quarter revenue call. Please note this call is being recorded and for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad. If you require assistance at any time, please press star zero and you will be connected to an operator. I will now hand you over to your host, Pierre Barnabé, CEO, to begin today's conference. Please go ahead. Hello, everyone, and welcome to Soitec's conference call dedicated to the publication of our fiscal year 2025 first quarter revenue. This is a quarter covering the period from April to June 2024. I'm Pierre Barnabé, Soitec CEO, together with me on this call are Léa Alzingre, our CFO, and Steve Baburek, our EVP Strategy. As usual, we will start with a few comments on our figures, and after that, we'll open the floor to questions. As we had announced in May, we hit in Q1 2025, our bottom, after a very strong Q4 2024 and before the expected rebound foreseen in the second part of the fiscal year. Q1 revenue is in line with our expectations when we disclosed our guidance for the full fiscal year 2025. As we shared with you, the RF-SOI inventory corrections across value chain has continued to weigh on our mobile communication revenue. This correction offsets another very strong performance in POI. Meanwhile, after a long period of very strong growth in automotive and industrial, we faced, in Q1, the impact of a slower automotive market. We are carefully monitoring the automotive market this year, and we remain confident that further digitalization and electrifications of the automotive industry will remain powerful drivers for the years to come. Regarding silicon carbide, we continue to progress on our roadmap and to build an entire ecosystem around our cutting-edge SmartSiC technology. I will come back to it later. To complete the overview of our Q1 performance, we achieved a very solid growth in Edge and Cloud AI. We have rebranded our Smart Devices divisions, now called Edge and Cloud AI, to better reflect the two dynamic markets we are addressing, Edge AI and Cloud AI. There will be no change in perimeter and reporting. All in all, we remain confident that the expected RF-SOI recovery will occur in the second part of the fiscal year, on the back of a recovery in the smartphone market, and we therefore reiterate our fiscal year 2025 guidance. So let me now outline our Q1 figures. Revenue in Q1 2025 reached EUR 121 million. This compares to EUR 157 million achieved in Q1 2024. It represents a 23% decline on a reported basis, breaking down between a 24% decline on an organic basis and a slightly positive currency impact of 1%. Let's look now in more details at our Q1 revenue by end market, starting with Mobile Communications. With a sharp drop in the volumes of RF-SOI delivered in Q1 2025, Mobile Communications accounted for only 40% of our revenue. Indeed, Mobile Communications revenue reached EUR 48 million. This represents a 46% decrease, excluding currency impact, against Q1 2024. As mentioned earlier, RF-SOI sales have continued to be impacted by the ongoing inventory absorption across the smartphone supply chain. We continue to see signs of recovery in the smartphone market, as well as improving inventory levels at fabless and OEMs. In the first quarter of fiscal year 2025, RF-SOI activities were slower to let persisting inventories flow down the value chain, resulting in substantially lower volumes compared to the first quarter of fiscal year 2024. In the context of a resilient smartphone market and healthier inventory level, we are confident that the RF-SOI inventory absorptions among our direct customers will soon come to an end, and that our RF-SOI sales will recover in the second half of fiscal year 2025. To add one more comment about RF-SOI, we continue to strengthen our customer intimacy and bring innovative products to the market. In that perspective, we announced in Q1 2025, an extension of our partnerships with UMC to bring to the market the industry's first 3D IC solution for RF-SOI technology. As we extend the domain of RF-SOI solutions to 3D integration, our customers will be able to integrate more RF front-end modules into a single device by vertically stacking dies and using wafer-to-wafer bonding technology. Future smartphones will accommodate new frequency bands and visions for the 5G-A dvanced and 5G era, while making room for new features to come. Moving on, moving on to POI. The very strong traction that we delivered in fiscal year 2024 has continued into fiscal year 2025, with sales increasing quarter after quarter since the beginning of fiscal year 2024. We recorded a sharp growth in POI wafer compared to Q1 2024. We continue to see an increasing number of customers validating the POI technology as a standard for RF filters. After three new customers who entered into productions in H2 2024, we added another one in Q1 2024. This brings to up to nine our total number of active customers, and we still have more than 10 in qualification phase. Our strong tractions on POI leverages the increasing adoption in discrete filters for the Chinese market. The ongoing second adoption wave is supporting more filter integration in complex MMIC modules. As for FD-SOI, sales were slightly below the level of Q1 2024, illustrating a phasing effect. FD-SOI will continue to benefit from greater millimeter wave penetration, increasingly more premium smartphones, growing Wi-Fi 6 and 7 penetration, and new application beyond smartphones. Overall, we are confident in both short and long-term prospects for mobile communication business, with the confirmed sign of recovery in the global smartphone market, the expected end of the RF-SOI inventory absorptions among our customers, the very positive momentum for POI, and the strong positionings of FD-SOI. Let's move now to Automotive & I ndustrial, which was not as robust as a very strong year achieved in fiscal year 2024. Automotive industrial revenue reached EUR 26 million. This is a 31% year-over-year revenue decline, excluding currency impact compared to Q1 2024. After several quarters of continuous and significant growth, our Q1 revenue has been impacted by a slower automotive market. The decline in revenue is essentially due to a drop in volumes of Power- SOI, after several quarters of significant year-over-year growth, which led to a very strong Q4 2024. We remain confident in Power- SOI prospects. Power- SOI is supported by a growing number of foundries and IDMs worldwide, and it is a key component for battery management systems, gate drivers, and in-vehicle networking. FD-SOI wafers recorded another strong performance, supported by an increasing adoption for automotive microcontrollers, Imagers, radars, and wireless connectivity. FD-SOI is the greenest technology choice for the development of zonal architectures, advanced driver assistance systems, high functional safety applications, wireless communication, radar, and edge computing. By embracing FD-SOI technology, the automotive industry can significantly reduce its carbon footprint without sacrificing performance. We are delivering on a growing demand for 28 nanometers and 22 nanometers FD-SOI as a platform to drive automotive systems with zonal computing, and the recent adoption of 18 nanometers FD-SOI is a strong endorsement of our product roadmap. Finally, we continue to progress on our SmartSiC roadmap, building up an entire ecosystems around our cutting-edge SmartSiC technology. The number of samples and prototypes that we delivered to more than 25 prospects globally, continues to increase for evaluation and qualification processes. SmartSiC device qualification and SmartSiC wafer productions ramp up in our plant will continue step by step, driven by customer demand and EV penetration. Looking ahead, we are confident on our SmartSiC roadmap and our ability to make SmartSiC a standard in a growing EV market. Finally, we recorded strong growth in Edge and Cloud AI. Edge and Cloud AI accounted for 38% of our total revenue in Q1 2025. Revenue reached EUR 46 million, a strong 47% increase, excluding currency impact, compared to Q1 2024. It reflects different dynamics across our diverse products. Sales of FD-SOI wafers were below the level of Q1 2024 due to a phasing effect on deliveries. They continue to be supported by edge computing devices, and in particular, by the need for ultra-power, ultra-low power edge AI applications. Sales on Imager- SOI were particularly strong in Q1 2025, as we benefited from a phasing effect. Sales of Photonics- SOI wafers were much higher than in Q1 2024. They were driven by the growing appetite for more powerful and more energy efficient data centers to sustain the exponential growth of AI-related computing power capabilities. Photonics- SOI is now a standard technology platform for high speed and high bandwidth optical interconnection in data centers, adopted in pluggable optical transceivers and used for the development of co-packaged optics. Turning now to our fiscal year 2025 outlook. As indicated earlier, we reconfirm our fiscal year 2025 guidance. We expect our fiscal year 2025 revenues to be stable at constant exchange rate and parameters versus fiscal year 2024. After the low point reached in Q1, we are expecting Q2 to improve sequentially, as we confirm that H1 is expected to be at around -15% year-over-year, at constant exchange rate and parameters. Our full year guidance implies a strong recovery in H2. This recovery will be led by a sharp rebound in our FSI as the inventory absorptions among our customers comes to an end in the context of a stronger smartphone market. It will also benefit from our strong growth in POI and Photonics- SOI. In addition, we also confirm expecting our fiscal year of 2025 EBITDA margin to be, to reach around 35%. So as a conclusion, let me highlight that we are leveraging the diversification of our product portfolio. We can now rely on a much better balance between our three divisions. Within each of these divisions, we have developed a much more diverse range of products. We are strengthening our strong leadership in SOI product, RF, FD, power, Photonics, Imager, and are succeeding in our expansions beyond SOI into compound semiconductors, in particular with POI, but also smart sensor. This ends my opening remarks. Thank you for your attention. We are now ready to take your questions. Thank you, sir. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, please press star two. Our first question comes from Aleksander Peterc from Bernstein. Your line is open. Please go ahead. Yes, good morning, and thank you for taking my question. I just have two. So the first one is just on the what exactly is going on in terms of the moving parts of your revenue in the first quarter. It seems to me that Edge AI had a bit of a one-off boost in Imager- SOI. So if you could maybe clarify what you mean exactly by the phasing effect here. We had the big decline in auto. So if that continues into the remainder of the year, it seems to me you'll no longer have the offset of very strong Edge AI that looks like a bit of a one-off. So just correct me if I'm wrong there. So, you know, just explain to us whether automotive declines will, will continue at this pace, or will this soften the remainder of the year in your view? And my second question is really on the qualification of SmartSiC at STM. Can you reiterate that this is still a calendar 2024 event, or could it slip into 2025, given the softness in automotive? Thanks very much, guys. Hello, Alexander. There are indeed several questions, more than two, because there are many moving parts we need to describe a bit more. Then you, you're right to mention that there are moving parts, but the good news, the very good news is the ability now of the Soitec groups, I would like to say the new Soitec groups, to face up and down within a quarter, depending on market demands. And it's very good to see that in front of softened, let's say, automotive market, we managed to develop more activities around the Edge and Cloud AI, thanks to Photonics and Imager. Then to enter more into details. If we look at Edge and Cloud AI, we benefit from Imager orders, that is also showing that in these type of applications, we are providing high-level products.... We managed also to face very important demands in Photonics- SOI, and more and more to sustain the AI adoptions in data centers and also at the edge level. And this is also the ability of our manufacturing and plants to be versatile and to be flexible in the way we need to produce our different SOI, I would like to say, wafers. That's the first point. Second point is on the automotive. There is a slowdown in the growth that is impacting our Q1 revenue this year. We see a market that's going to be more or less flattish for us this year, particularly because the power- SOI demand is a bit slowing down. We had a very good fiscal year 2024, as you know, and we need to see our customers getting more and more, let's say, demands from automotive users. But we see this market more or less in a flattish zone for power- SOI and FD-SOI. Looking at SmartSiC, we are in an adoption phase, as you know. What is very important is I believe we need to start with the original point. The original point coming from us, because we are creating this standard. On SmartSiC, we are exactly on time, as, as a company, as Soitec, that we are on time with what we promised to the market in terms of technology. We are on time in what we promised to the market in terms of product and the features of the product for the 150 millimeters, and then 200 millimeters. We are on time in the, the building up of the ecosystems with poly- SiC, mono- SiC providers. We are on time by having a factory that is up and running to produce massively. Now, it's a question of SiC demands and SiC markets, okay? Then in the range of fiscal year 2024, some qualification events will occur, but in fiscal year 2025, we-- twenty-five, sorry. Some qualification events will occur. In fiscal year 2026, qualification events will occur. Fiscal year 2028, fiscal year, qualification events will occur also. Then it's a question of timings across the different customers. Because as we explained already, the automotive market is a complex market. We need to be qualified through different models, through different IDM or integrators. Then there are calendars of qualification across those 3-4 years to come, and it's where we are working on. What is super important at the end of the day is to keep very strong relationships with our customers, the three customers we have today, the 25 prospects we are working on today. And you're going to see across the quarters that step by step, we're going to expand our commercial footprint, and we're going to make SmartSiC a standard in the years to come. That's very important for our customers and our prospects to feel that we are ready: product, technology, ecosystem, and manufacturing point of view. So just to clarify, because we know of one named tier one customer that you have in SmartSiC at STM. You can no longer commit to the fact that it's actually going to be a 2024 event, calendar 2024? I mean, I'm just asking because that's the only one we know about. So I understand you're going to have more qualifications and so on, but we just need to know where, where, where the STM qualification stands. First of all, we cannot talk on behalf of any of our customers. As you know, we are just talking about what we commit. We still expect one part of the qualification by the end of fiscal year 2024, okay? But we'll have other steps. As I said already, it's a step-by-step qualification process. You have the 150, then the 200, then you have different type of models, and so on. Then it's a step-by-step qualification process, but we expect the first one by the end of fiscal year 2024. Okay. 25, sorry. Okay, great. Thank you very much. Thank you. We will take our next questions from Sebastien Taveau from Kepler Cheuvreux. Your line is open. Please go ahead. Yeah, hello, everyone. Thanks for taking my question. On RF-SOI, could you please comment a little bit more on the level of inventory among your large foundry partners, where they are standing right now, what kind of visibility you have, really on the RF-SOI inventory? Or are you sure that by September it will be more or less completed? Thank you. This is the first question. Thank you. Then as we said, we see a rebound on the second half of the fiscal year 2025. We are observing and monitoring very cautiously for the information we are gathering. Of course, they are open, there are also discussions with customers, and it's aggregations of many datas. At the end of the day, we clearly see that at fabless and OEM levels, inventories are in a replenishment mode in many cases. Okay, not everywhere, but in many cases with a strong, let's say, dynamics in China and other parts of the world... a bit less timid in the Western world, but let's say waking up step by step. Regarding the foundries level, it's a diverse picture. Some foundries are already in a replenishment mode. Others are still in a depletion mode, okay? On average, the rebound going to come in second half fiscal year of 2025. But it's what is clear, the depletions is ongoing. Looking at the level of RF-SOI we had in Q1, you can guess that we are in a depletion mode. In Q2, it's going to continue, and we see in H2 replenishment and some active orders coming from the foundries, incoming from China, but also coming from the rest of the world. Okay. And coming back to smart SiC, there is a significant capacity addition around SiC wafers in China with TankeB lue, SICC building up a lot of capacity. There is maybe some risk, maybe some risk of over capacities in China. Is this something that could affect the development of your SmartSiC business going forward? Today, the real trigger point for SmartSiC business is the demand of electric vehicles for the coming years. That's really the point. Because we know already the mono SiC production capabilities in China for years. We know already the level of prices that is expected by calendar 2028, calendar 2029, and we are prepared for that by having a plan to be cost effective, because our SmartSiC is by structures cost effective. And the real differentiations we are bringing is still totally active and accurate, and we are proving it with our 2025 prospect. That means concentration of dyes, better conductivity, lower CO2 consumptions for the productions, but also for the running. Then this is really the three differentiators, four differentiator that are counting for our SmartSiC conquest. Then the real trigger point is not overproduction in China, prices of the mono SiC. I would like to say we are benefiting from it, because we are buying some mono SiC wafer, and we are benefiting from this effect. The real question is the reasons of, let's say, adoption of electric vehicles across the world, that going to give the tempo for the smart SiC adoptions and deliveries. This is really the name of the game. But from a technology and economical point of view, what is happening today in China is not a surprise to us, and we are prepared for it. We thank you, Pierre. You're welcome. Thank you. Our next questions comes from François Bouvignies from UBS. Your line is open. Please go ahead. Thank you. My first question is, you talk about H2 recovery, but you reiterated the 15% decline in the first half, which, after -25% in Q1, that would suggest a very sharp recovery already in Q2, I mean, more than 80% quarter-on-quarter. So I was wondering if you could, you know, explain, you know, what is driving this sharp recovery on a quarter-on-quarter basis by business line would be helpful, and if there is anything we should be aware of? Yes, I first of all, you know, the seasonality of a Q2 higher than the Q1, it's quite classical with Soitec. And last year, we had a 70% increase, I believe, between Q1 and Q2, then something very comparable. We're going to benefit from growth effect in many domains and many products, and we see our RF-SOI growing significantly compared, of course, to Q1, obviously. We see also at the SOI higher figures. We see Photonics that are going to continue, of course, to increase, because the demand for Photonics is higher and higher. Of course, POI, that is going to continue to progress, taking into account that each month we are making some progresses in the yield and the production capacity of our Bernin 3 fa ctories. With these four main line of products, you can guess the big rebound we're going to get between Q1 and Q2. That going to be also the drivers for the full year. The four main products we mentioned going to be the going to fuel the big growth also between H2 and H1, because we're going to get also a very big growth between the two semesters. Right. Thank you. My follow-up would be on POI. You mentioned 10 customers under qualification. Yes. And I was wondering if, you know, is there any customer that could change, you know, the scale of this business line? I mean, because for now, you had these nine customers that you said, and it's growing fast, but I guess from a low base, and you still don't want to disclose the percentage of revenue that POI is. So I guess it's not a bigger portion yet. So I was wondering if, among these ten customers, if there is any that can, you know, move the needle a bit more, in terms of the size of your customer? Of course, we will have more and more customers that are going to move the needle. But at, you know, the ambition we have since the beginning on each product we put on the market is to become a standard. Then having 9 customers today, 10 under qualification, meaning 20 at the end of the day, you can guess that among the 20, we have big elephants. And of course, if we manage to get these 20 customers qualified and in productions, we're going to be very close to declare POI as a standard. And this is part of our plan. Then POI is going to continue to grow very fast in the coming 2-3 years at minimum. Of course, in this trajectory, three or four big customers going to be part of this trajectory and the growth, for sure. Thank you. Thank you. We will take our next questions from Olivia Honeychurch, from Jefferies. Your line is open. Please go ahead. Morning. Thank you for taking the question. My first is on the mobile business. So we're hearing quite a lot of positive news flow across the industry around the smartphone market, and you've mentioned it in your comments around seeing the early signs of a recovery. We're also hearing that Apple is expecting pretty healthy builds across its supply chain for the iPhone 16. Is it possible that those trends could help drive a faster depletion, or are helping to drive a faster depletion of our SOI inventories than what you had previously expected? And I guess following on from that, as a result, a quicker or steeper recovery after we get to that bottom in the inventory cycle? Yeah, of course, the rebound of the smartphone market is confirming and strengthening our signals and our VABT to experience a rebound on the second half of fiscal year 2025, and of course, beyond. But of course, it is taking time for us because of inventory depletions we are experiencing right now, prior to the minutes we are talking. That means that H2, we're going to see a replenishment, and for sure, more and more RF-SOI wafers to be delivered. Then come the acceleration of the rebound of the smartphone market, that could fuel a bit a better growth, but that should come in the next years, okay? If we take the example of AI introduction within the phone, and the expectation that people are going to get back to new materials, new devices, this will occur by end of calendar 2024, early calendar 2025. That means that we're going to benefit from this effect right after. Of course, it's good news for Soitec midterm, and that's going to reinforcing our $2 billion midterm revenue target. But this is this will come later. But the good news is that it gives very strong signals of growth and maybe acceleration of this growth in the smartphone industry. And second, it's going to also give us hopes that the footprints in RFFE are going to increase because we are targeting here premium and high-end phones. That, as you know, is benefiting to Soitec. Great, thank you. My second is on FD-SOI for millimeter wave. How much of the market are you penetrated with here today, and how do you see that growing going forward? Is there a chance that you see adoption at some point outside of the Android side of the market? Then for the moment, as you know, millimeter wave is in the range of 15% adoption rate because limited to three main countries, one of which being the States. The block Uncertain would be China, but for the moment, there is no clear signal that China going to adopt a millimeter wave solutions or a millimeter wave-like solutions, and we stick to 15%, and our model is betting on 15%. But what we see is more and more FD-SOI needs to sustain this millimeter wave, let's say, features. If you take the Galaxy S24, we have a 50 mm square RF-SOI for front-end modules, but we have also 50 mm square of FD-SOI to sustain the millimeter wave capabilities for the U.S. model. Then it is also fueling the development of FD-SOI. But, you know, FD-SOI is not only dedicated for millimeter wave. We have also applications like envelope trackers, satellite connectivities and so on, for which a millimeter wave is, sorry, FD-SOI is necessary. Then we see more and more features fueling, of course, the need for a better footprints in the smartphones from Soitec. And the AI adoptions could also fuel the extensions of the footprint. We expect an increase by 10% of the footprint yearly base. That's great. Thank you. Whatever it is, Android, Apple, and so on, it's average. ... Thank you. We will take our next questions from Didier Scemama from Bank of America. Your line is open, please go ahead. Yes, good morning. Thank you for taking my question. I just wanted to go back to, you know, your second quarter guide. I think you guide first half, down about 15%, and obviously there's been much debate, and now your question on, you know, 80% or 88%+ growth in Q2. So I just wanted to go back to what you mentioned, Pierre, which is that automotive and industrial will be sort of flattish from here. So A, did I understand correctly, is that a guide for Q2 and for the rest of the year? And implicitly, if that's the case, where is the growth coming from? Is it mobile and edge and cloud AI? Maybe just give us a bit of color on how do you see the trends for these two markets. I appreciate Q1 is a very depressed level, well below, in fact, where you have been in the past, and in Q2 has happened, you know, this sort of very brutal sequential growth rates. But surely, you know, there is a lot of concern in the market that, you know, you might not be able to deliver on that, on that guide in Q2 and in the second half. So maybe just give us a bit of color, and I've got a quick follow up on filters. Thank you. No, of course. Then, as if you remember last year, how the Q1, Q2 sequence was plus 70%, then this year it's plus 80%, and we are really in the same range. And it's a performance we're going to reiterate this year, fueled by a rebound in RF-SOI. Because really, we have reached the lowest point in RF-SOI in Q1. Then we're going to increase significantly between Q2 and Q1 on RF-SOI. We're going to continue to grow and to accelerate the growth in POI, to accelerate the growth in Photonics. And we also see a good momentum on FD-SOI. Whatever the applications, of course, for edge and cloud AI applications, for automotive application, and also smartphones, mobile communication applications. Then these are the four engines of growth: RF, POI, Photonics, FD-SOI. That's going to bring us to around -15% decline in H1 from -24% in Q1. This is really what we see. Taking the last part of your question on flavors and the filters and POI. As we say, the fact that we don't, you remember, six, no, nine months ago, I was talking about 5 customers. We have today nine customers. We are in qualification with 10 new customers, amongst which, you understood my answer, there are big, big customers, very significant, let's say, game changers. Then you can imagine that the filters POI activity is going to continue to fuel the growth, not only in Q1, in Q2 as well. That's helpful. But just clarify, your, your flattish commentary for autos, is that from the Q1 level for the rest of the year, which implies obviously a very significant decline for the full year? Or is it flat for the full year, so compared to the 163, even if you carry it 2024? Flattish for the full years. Got it. Flattish for the full year. Okay. Taking into account, if you remember, that there are three big lines of products now within the automotive: power, FD-SOI, and smart safety. Absolutely. And I think you sort of answered my follow-up on the filter business. But on the sort of nine plus one customers you have, I know you've got ambition to get to 30% market share in filters over time, and obviously you seem to be quite enthused about your design and momentum with, you know, the other sort of big elephants in the market, as you call them. If you look at your 10 customers currently, how much market share do they have in RF filters? If you were to convert the additional 10, would that give you, you know, that, that sort of magic, more than 50% market share, at least in terms of, you know, you're talking to them, you're shipping to them, you've got technology designed in, in those, in those guys, you know, over time. So can you maybe just clarify that? That would be lovely. Thank you. Yes. Then indeed, you know, the filters market is a quite big market. We are with our technologies targeting the SOI segment, and a part of the BAW, then the surface acoustic waves layers, and a bit of the BAW also layers. And there are other technologies, of course, existing to, let's say, provide filtering capabilities in the phones. Then amongst this market, what we are targeting, but perhaps we could revise a bit this target. But today, what we are targeting is 30% market shares in the filtering business, thanks to our POI technology. Looking at the trend and the trajectory today, this is a reachable target. It could be perhaps revised up, but for the moment, this is what we are looking for. Fantastic. Thank you. Thank you. We will take our next questions from Emmanuel Matot from ODDO BHF. Your line is open. Please go ahead. ... Good morning, Pierre. Emmanuel speaking from ODDO. Two questions on my side. First, what normative level will you, will your customers decide to keep for FD-SOI inventories in this new positive cycle for smartphone? Will it be lower in line or higher than what we have seen before Covid, according to you, what are your customers telling you on that topic? Second, you had your shareholder assembly yesterday. When will the board decide on the next chairman? What is the timetable? Thank you very much. Thank you, Emmanuel. Then for the first question, we do believe that the level of inventories expected in the foundries particularly, but also in the whole value chain, supply chain, going to be comparable to, let's say, a pre-COVID level, even higher. Because, what we see, first of all, keep in mind that this level of inventory is made on the consumptions as it is today, but the consumptions will accelerate. That means that, to be sure, nobody will miss, you know, new designs to come, they need to get a high level of inventory. We said it several times, but between the time a design is won by foundries, and it is delivered into the phones, it's between 12-6 months, depending on the quality of the phones. That means that you can guess the level of inventory you need to have, including a buffer. Because what's going to be the next battle for the smartphone business to come, particularly with the next generation of smartphone embarking AI, going to be to hit and to win the deals and to be able to deliver. That's to be sure, they're going to be able to deliver, they need enough inventories to catch these new deals to come. That's the reason why we do believe that the level of inventories will be quite comparable to pre-COVID, post-COVID in the middle effect. But we will never see the pre-COVID level of inventory that were too low, way too low, because they want absolutely all of them to take the wave, because the market shares to be taken will be expensive, and it's now. Battle is starting now. Then, regarding the general assembly, we had a very good general assembly, and of course, with the change of chairman with Christophe Gégout taking the interim, it's a very smooth move. Eric also keeping a role as advisor, strategic advisor to me. The board is looking at profiles who could take over the chairmanship. There is no, let's say, timing pressures, particularly, because, again, we have a very good interim chairman who knows the company by heart, and who is accepted by everyone. Then let's say that in the course of one year, the board is going to be in a position, but I'm not talking on their behalf, but they're going to be in a position to find a new chairman for the group. Thank you very much. Thank you. Thank you. We will take our next questions from Adithya Metuku, from HSBC. Your line is open, please go ahead. Yeah, good morning, guys. Thank you for taking my questions. So firstly, just on Imager- SOI, I'm not sure I understood the response on phasing. I just wondered if you could give us some additional clarity on what exactly happened with Imager- SOI and the quarter that drove the revenues to be so, so strong. And secondly, I believe last quarter, you said autos and industrial will grow in the double digits for the year. So now, if autos and industrial is going to be flat for the year, what is helping you keep your fiscal year 2025 guidance unchanged? Where are you more optimistic on demand versus a few months ago to make up for the, you know, slower expectations in the automotive and industrial division? Thank you. I will come back to Imager, but let's start with your question on automotive. That's right. A few quarters ago, we were looking at forecasts by our customer. That has been revised, reflecting automotive demands and markets, and we need to be adaptive, and we need to reflect what we see on the market demands and what we hear from customers. The very good news is that we are not losing market shares. I would like to say that we are gaining market shares. If I just look at POI SOI, we are getting more and more qualifications in this market, in this product. And we are talking about 300 millimeters now with many customers, then from 200 millimeters, we prepare the future for 300, but we need to be adaptive to our demand. And it's where Soitec is becoming more and more resilient and more and more flexible is that we are able to, let's say, compensate this, let's say, slowdown in the automotive market by better, let's say, better forecast coming from Edge and Cloud AI, particularly coming from Photonics, but not only, and also FD-SOI. Also compensated by a better POI forecast, as we can see, and RF-SOI that has been starting with Q1, a bit better than we were expecting. Then all-in-one, we see clearly a flattish fiscal year of 2025, because we are able, looking at the up and down in the demands, thanks to the diversification of our product and customers, to be in a position to compensate, if any. Regarding the Imager, you know, it's a business quite concentrated. We have a seasonality effect on Q1. We're going to continue to sell some Imager, of course, along the years. But there are some peak, and we had a peak in Q1. We're going to get other orders later in the years to come. But this is a particular application for particular, let's say, type of customers I cannot disclose. Understood. Thank you. Maybe just a quick follow-up. On the automotive and the industrial side, would it be fair to assume that the slowdown is mainly due to Power- SOI, and nothing else has changed in your expectations from a few months ago? Yes, it's a slowdown, really, in terms of demand, nothing else. It's really linked to the market, because, again, when we look at the market shares we have in Power- SOI and the needs to come, it's intact. And I would like to say we are more and more traction in terms of qualifications. When I look at FD-SOI, we see more and more adoptions in FD-SOI, which was part of my speech in introductions. The fact to introduce AI in the cars going to be an incredible driver, an incredible leverage for FD-SOI adoption in the cars for the coming years. Because, you're going to need FD-SOI to support AI application, to support new type of safety, entertainment, and so on. And you're going to get also, a need, a particular need, for reducing power consumption in the cars. Power- SOI being, of course, also particularly, fitting with, for the battery management system in, in reduction of power consumption. And SmartSiC, the fact that we are working with 25 prospects today, on top of the three customers we have, is also giving us a lot of confidence that this technology going to be, going to be adopted as a standard in the coming, 5-7 years. Got it. But my question was specifically for this year. The reduction in expectations on the automotive and industrial division, they're driven by Power- SOI and not by the other bits of automotive and industrial. Is that—is my understanding correct, or? No, it's an overall view that the combination of the main three product lines giving us a flattish yearly view for automotive industry. Okay, thank you. Thank you. Our next question comes from Daniel Schafei, from Citi. Your line is open. Please go ahead. Yes, morning. So just again, on autos and industrials. So I thought, given that initially you were thinking more of double-digit growth for the year, now it's more flattish growth. What-how do you see the pace of recovery for this sector going forward? And yeah. For the auto. Well, what we see, we just listen to the supply chain, and we listen to the main players in the automotive industry. There is a slowdown in electric vehicles, okay? In the slowdown in the growth of the electric vehicles, because there is still a growth. The market is supposed to get back to an intense growth level in the coming years. Then we're going to follow the demand, and we're going to anticipate also the demands. You know, again, what are the main drivers for the automotive transformation? Is whatever the model, EV, hybrid, conventional. It's digitalization for any models and electrification for hybrid and EV. We are providing products that are enhancing, enabling digitalizations and electrifications. Then our portfolio of products is exactly answering these two main growth drivers. Then this is at the end of the day the main point, and the fact that we are increasing our market shares and the adoption level, I cannot disclose any names, but we are in discussions with customers, very important customers in automotive industries, that are not today using SOI solutions for the moment. Then this, if these prospects are becoming customers, it's going to be an acceleration in our market share then. We're going to be when the automotive market, we're going to grow steady again. We're going to benefit more from this growth, because in the meantime, we are preparing the ground to increase our market shares in Power- SOI, FD-SOI, and of course, SmartSiC. Great. And if you could also give us a little bit more color on how much growth of this in the auto and industrial sector will be driven by demand from China? Well, China, of course, is a very important market for us. As you know, we are growing more and more in China overall, whatever our portfolio, and POI has benefited at the beginning from a very active Chinese market that was a kind of greenf ield for new technology adoptions. We see this phenomenon everywhere. Then, if you look at the automotive market, of course, the EV market in China is very important. It's the first one. But overall, we believe that for automotive, China should weight something like 30% for automotive industrial business, let's say midterm. This is what we expect, reflecting more or less finally the car manufacturer and market volumes and value. Perfect. Thank you. Thank you. We will take our next questions from Robert Sanders from Deutsche Bank. Your line is open, please go ahead. Yeah, good morning. Thanks for taking my question. I guess on SOI power, I was just wondering what your split is between 200 and 300 at the moment. I guess the reason I'm asking is because some of the Power- SOI tech is moving to 300 millimeter, and I know NXP, which is your largest customer, I think, in SOI Power, has just announced a large expansion in 300. I was just interested to know if that is potentially something you can benefit from? And I have a follow-up. Thanks. Your question is on power only, yeah? Yes, Okay. SOI power, yes. Okay. On power, for the moment, it's only 200 millimeters, okay? Then we are working on, let's say, qualifying the 300-millimeter solutions. That is ongoing amongst many customers, including the one you mentioned. But there are, let's say, a list of, among five customers, more or less, in which we are in a qualification phase, 200- and 300-millimeter. But for the moment, the products we are commercially selling and that are equipping the cars, is 200-millimeter based. Thanks for that. And the other thing is just on millimeter wave. I noticed the latest iPad doesn't actually support millimeter wave anymore, which does kind of worry me that, you know, Verizon is kind of losing interest in millimeter wave. Because Apple just discontinued millimeter wave support on the iPad Pro. I mean, how meaningful would it be if Apple was to, you know, drop millimeter wave support altogether on the iPhones? Thanks. Well, we keep going that the penetration going to be around 15%. After a while, some telecom service providers could have some specific strategy, let's say, reflections, that is not really impacting this 15%. We sell FD-SOI more and more to support millimeter wave, let's say, handset deliveries, particularly in the U.S. And as I said, if we take the S24 Galaxy by Samsung, dedicated for the U.S. market, 50 millimeter square is dedicated for FD-SOI in order to mainly support, with several modules, millimeter wave adoptions. Then this, we don't see some softening or slowdown in FD-SOI sales and adoption within the handset regarding millimeter wave. Got it. Thanks a lot. Thank you. It appears there are no further questions, so I will hand back to Mr. Pierre for any additional or closing remark. Please go ahead. It appears we have no more questions, so I will hand back to Pierre for any additional or closing remarks. Please go ahead, sir. Thank you. Thank you for your interest, your interest in Soitec and the dynamic exchange this morning. The next date in our agenda will be the combined release for Q2 25 revenue, and our H1 results on the twentieth of November, after market close. This ends our call for today. Thank you again. This concludes today's call. Thank you for your participation. You may now disconnect.