Good morning, good afternoon, and good evening. Welcome to Lenovo's Investor Earnings webcast. This is Jenny Lai, Vice President of Investor Relations at Lenovo. Thanks, everyone, for joining us. Before we start, let me introduce our management team joining the call today. Mr. Yang Yuanqing, Lenovo's Chairman and Chief Executive Officer. Mr. Wong Wai Ming, Group Chief Financial Officer. Mr. Ken Wong, President of Solutions and Services Group. Mr. Kirk Skaugen, President of Infrastructure Solutions Group. Mr. Luca Rossi, President of Intelligent Devices Group. We will begin with earnings presentations, and shortly after that, we will open the call for questions. Now, let me turn it over to Yuanqing. Yuanqing, please. Hello, everyone. Thank you for joining us today. Last quarter, we achieved $12.9 billion in global revenue, with a net income of $191 million on a non-HKFRS basis. Despite a challenging market with unfavorable macroeconomic conditions, our service-led business achieved a strong growth and a sustained profitability. With a non-PC revenue mix further increasing by four points to 41% now, continuously demonstrating the effectiveness of our efforts in building diversified growth engines. As we predicted, with PC channel inventory digestion coming to an end, the trends of shipments and activations have become more consistent. Actually, the year-on-year decline of shipment was lower than PC activations for the first time in six quarters. The AUR, or average unit revenue of PC, was under pressure due to declining component price and intensified competition, and impacted our revenue. The entire devices market is facing a similar challenge, including smartphone, tablet businesses. Meanwhile, in the short term, the infrastructure market is challenged on multiple fronts, and that had downward pressure on our top line and bottom line as well. In the next two to three quarters, we remain cautiously optimistic about the business recovery as the economy stabilizes and improves, and the component price bottoms out. The client device market is expected to recover and resume growth in the second half of the year. With a $850 million cost savings plan executed more than committed, we will take more actions to keep our ETR ratio more resilient, and we are still committed to continuously improving our profitability. Meanwhile, the booming of the intelligent technologies, such as AI-generated content, is propelling the wider adoption of AI, accelerating digital and intelligent transformation across industries. For many years, Lenovo has been driving our transformation to become a full-stack intelligent solution provider, and we are well-positioned to capture the significant growth opportunities ahead and transcend the cycle. Also, unchanged is our commitment to doubling our investment in innovation in medium term. Over the next three years, we will invest an additional $1 billion to accelerate AI deployment for businesses around the world, focusing on AI devices, AI infrastructure, and AI solutions. We will continue to empower our customers and consumers in all walks of life to grasp the opportunities in the era of intelligent transformation. Now, I will talk more about each of our businesses. Let's start with SSG, Solutions and the Services Group. Last quarter, SSG again delivered a strong growth and a higher profitability. While we protected the support services business as our core profit engine, we made significant progress in expanding our managed services and the project and the solution services, the revenue of which has now grown to account for more than half of SSG business, four points higher year-on-year. Over the next three years, the trend of digital and intelligent transformation will continue to drive strong growth of global IT spending, especially in IT services. At the same time, overall demand for vertical solutions, including smart city, smart manufacturing, smart education, and smart retail, is expected to see strong growth through 2026 as well. SSG also continued to scale with our hero offerings, such as digital workplace solution, hybrid cloud, and sustainability, and incubate these horizontal building blocks into vertical solutions to help our customers improve employee experience and productivity. Our Infrastructure Solution Group, or ISG. Last quarter, its overall revenue declined year-on-year for the first time in many quarters due to overall cloud service provider, computer server demand softness, GPU constraint impacting full AI adoption, and the industry's slower than expected transition to the next-generation platform. We achieved a hyper growth in storage, software, services, and high-performance computing. In particular, storage achieved a triple- digit year-on-year growth, and made us the fourth largest storage provider in the world. In AI, hardware infrastructure business, based on the latest IDC definition, we grew by triple-digit and is the number three in the world. Driven by AI-generated content breakthrough, the ICT infrastructure upgrade is accelerating even further. We will continue to invest in developing AI-ready and AI-optimized infrastructure, such as Edge AI, AI Hybrid Cloud, as well as server and storage that support AI-centric workloads. We will persist in differentiated competition, aiming to resume premium-to-market growth and sustainable profitability as soon as possible. We remain focused on becoming the most trusted infrastructure partner for our customers in their digital and intelligent transformation. Our Intelligent Device Group, or IDG, is still under a lot of pressure last quarter. Despite all these challenges, we maintained our global number one market share in PCs, with inventory normalized to a healthy level. Our smartphone business achieved a record Q1 activation in 10 years, with our improved channel inventory, which will bring even more growth potential for the future. We further strengthened the premium and the 5G with the successful launch of Motorola Razr. We also demonstrated great growth potential in smarter collaboration and smarter home areas. We remain committed to investing in technology innovations to ride on industry trends and build long-term competitiveness. We are driving collaborations on building the next-generation AI devices, such as AI PC, AI smartphone, to deliver certain level of inferencing. For our smartphone business, we will continue to execute on our three-year growth plan, which has helped us achieve premier growth in our traditional strongholds in North America and Latin America, and make solid progress expanding into EMEA and Asia-Pacific. Meanwhile, we also expanded our smart devices for a more diversified portfolio and enriched software and services to build IDG ecosystem. Lastly, at Lenovo, we believe a challenging business environment only makes innovation more important. AI and computing are our anchor technologies and the critical pillars of our intelligent transformation strategy. We will continue the hard work and drive innovations. Here, I would like to take this opportunity to invite you to Lenovo Tech World, our annual flagship event in October, where we will showcase our AI devices, AI infrastructure, and AI solutions, all for individuals, enterprises, and vertical industries. Looking ahead, we will more effectively control expenses and mitigate risks, so that we can deliver sustainable profitability improvement, and continue to drive transformation and innovation to build a smarter future for all. Thank you. Now let me turn it over to our Chief Financial Officer, Wai Ming. Wai Ming, please. Thank you, Yuanqing. I will now take you through Lenovo's financial and operational performance for Q1 in fiscal year 2024. Next slide, please. Despite the persisting macroeconomic headwinds, the group accelerated service-led transformation with our SSG revenue up 18% year-on-year, and our non-PC sales improved to 41% of the combined sales of its three business groups. Our progress in inventory reduction and strong balance sheet has bolstered agility to capture the future growth opportunities, including AI. We are committed to returning to target profitability. Doubling the net margin in the medium to long term remains the group's priority. The group's strong gross margin reached 17.5%, driven by the increasing contribution from the high-margin service business. The group was disciplined in streamlining its operating expenses structure. Operating expense was reduced by 11% year-on-year, ahead of our committed $850 million run rate savings targets. Persistent headwinds remained in the quarter and impacted IDG and ISG, resulting in a 24% decline in group revenue to $12.9 billion, or down 22% in constant currency. The magnitude of the revenue decline was heavier than expected, which led to a higher ETR ratio. The quarter saw a recent low in net profit margin on non-HKFRS standard. Group profit attributable to equity holders was $191 million, down 66% year-on-year. Global economy starts to stabilize, although challenges remain. The group will continue to focus on controlling expenses, enhancing product competitiveness, and identifying new growth catalysts in order to expedite business recovery and expand profitability. Next slide, please. We continue to optimize the efficiency of group operations for greater responsiveness to challenges and long-term growth opportunities. Cash and cash equivalent balance reached $4.4 billion in June, up 15% year-over-year. For the seventh consecutive quarter, the group delivered a net cash with a balance of $454 million, 15% higher than a year ago. Inventory was reduced by nearly $3 billion, or days of inventory reduced by seven days in the quarter, attributable to accelerated adjustment in raw materials. Days of accounts payable and receivable together improved 17 days. The group shortened its cash conversion cycle by 24 days to -11 days. All of these are critical steps in ensuring a prudent capital management to support future growth and accelerate business transformation. Next slide, please. please. Successful service-led transformation positioned SSG to be a key beneficiary of the new IT era. SSG delivered a year-on-year revenue growth of 18% to $1.7 billion, highest for any first fiscal quarter in SSG history. Operating margin of 21% demonstrated business resilience and robust profitability. Operating profit of $361 million was up 10% year-on-year. SSG continued to enrich its service portfolio across all three segments to meet evolving customer needs and to drive scale and profitability. Management service grew 54% year-on-year, capitalizing on strong demand for TruScale as-a-Service solutions, including first TruScale wins in Gulf countries in the quarter. Revenue of support service increased 9% year-on-year, thanks to rising penetration rates that came with greater popularity of attached services, such as Premium Support and sustainability offerings. Project and solution services revenue rose 9% year-on-year, supported by strong demand for vertical solutions. Next slide, please. After outperforming the sector in growth for past three fiscal years based on server revenue, ISG was ultimately impacted by accelerated weakness in cloud server compute spending, combined with global GPU constraint impacting the AI server supply chain, and a slower-than-expected transition to the next-generation platform. ISG reported Q1 revenue of $1.9 billion, down 8% year-on-year. Its segment operating performance turned into a loss of $60 million as a result of its smaller scale operations. Despite its server sales being impacted by these short-term sector-wide headwinds, ISG achieved multiple sales records across several product categories, showcasing its success in portfolio expansion. Its storage revenue more than doubled year-on-year. Sales of edge product and software increased by strong double digits. In high-performance computing, ISG continued to reign as the top global player, growing at 45% year-on-year in Q1. In terms of server product, since cloud orders tend to be bulky in nature, its sales pattern can be more accurately assessed on a semi-annual basis. ISG first half-year run rate growth in calendar year 2023, reached - 4%, which is at a premium to sector growth. This product strategy plays an important role in enabling a broader adoption of AI by simplifying the deployment of AI solutions for businesses. The group has an AI-ready portfolio of smart devices and edge-to-cloud infrastructure. Lenovo and ISG will invest an additional $1 billion to further expand its portfolio to provide one-stop, state-of-the-art AI enablement and solutions. Most recently, ISG new ThinkSystem model utilizes the most powerful universal GPU accelerator to deliver breakthrough performance for large language model inference and retraining, and graphics and video applications, including 8- GPU support. Another focus area is our investment in building an AI ecosystem. The Lenovo AI Innovators program is now delivering 150+ turnkey solutions, helping businesses implement generative AI, immersive metaverse simulations, and cognitive decisions at scale. Next chart, please. Having navigated through the final phase of inventory digestion in the sector, the magnitude of IDG shipment decline was substantially moderated in Q1. The trends of PC shipment and activations are now more consistent. Nevertheless, our actions to clear inventory across the sector led to more competitive pricing pressure, and as a result, IDG's revenue declined 28% year-on-year. Its segment operating profit decreased by 39% to $650 million. IDG maintained its leadership position in global PC sector. The business made great progress in seizing growth opportunities beyond PC products, with non-PC sales making up 21% of IDG's revenue. Its smartphone revenue declined at the beginning of the quarter. Its activation rate, would represent the actual customer demand, rose double-digit year-on-year towards the end of the quarter. Overall, the group's quarterly smartphone activation set a 10-year record for fiscal year 1st quarter to support demand recovery. The trend is particularly strong across EMEA, Asia-Pacific, and North America. Smartphone premium makes achieve a record high of 18%, driven by successful Razr launch. Next chart, please. Let me shift gears and talk about R&D investments. As we continue to invest in innovation to foster diversified growth engines, R&D spending as a percentage of revenue rose to 3.5% from 3% last year. AI has become a key enabler for many technologies and will unleash higher operating efficiency for us. More importantly, AI has created tremendous opportunities given the group's comprehensive and diversified exposure across devices, infrastructure, and services. As mentioned earlier, we announced in June this year to invest an additional $1 billion over the next three years in AI. We have also extensively collaborated with many key partners to develop next-generation product roadmap and solution portfolios together. This strategic investment and collaboration will build our competitiveness in the long run. Next chart, please. The group was consistently recognized for its ESG performance with numerous accolades, including the Best Employers for Diversity award by Forbes. MSCI upgraded the company's ESG rating to AAA, while EcoVadis acknowledged the group's excellence in sustainable procurement with an Outstanding Program Leadership Award. Lenovo has once again been named in the Gartner Supply Chain Top 25 for 2023, ranking 8th in the list of global companies with supply chain operations. The company has fully embraced digital transformation across its complex, extensive supply chain network. Additionally, Lenovo was highlighted in the Bloomberg Gender-Equality Index for the fourth consecutive year. Next chart, please. The trend of digitalization will unlock new opportunities in computing and AI solutions. AI is incredibly powerful, and we are leveraging our group's full capabilities to unlock the potential of AI. These opportunities should benefit all business groups, from infrastructure to services and devices. Looking ahead, SSG see promising prospect for digital transformation and will continue to scale with next-generation offerings, including digital workplace, hybrid cloud, and sustainability solutions, while safeguarding its core business with high-value-added support services. Strengthening partnership and channel tools are also key growth initiative for SSG to enhance its contribution to the group's success. ISG has built industry-leading full-stack offerings and expanded to end-to-end infrastructure solutions that include hybrid cloud, HPC, data management, AI, and edge computing. AI provides new growth opportunities for ISG, and its unique ODM+ business model addresses the growing demand for vertically integrated supply chains. The business will continue to diversify its customer base and drive new account acquisitions. The approach will achieve an optimal balance between general purpose and customized cloud offerings, while ensuring an appropriate scale and efficient cost structure to drive revenue growth and profitability. The global PC market is stabilizing and well-positioned for a year-on-year recovery in the later part of 2023. In addition, the increasing popularity of a digital life centered around PC will drive demand structurally higher than the pre-pandemic level. The commercial upgrade cycle and the premiumization trend will help IDG drive premium-to-market growth. IDG will continue to drive efficiency with its lean operations, maintain healthy cash generation, and invest in non-PC areas, including fast-growing accessories and work collaboration solutions. Its smartphone business will focus on portfolio and regional expansion, as well as differentiation to take advantage of accelerated 5G adoption. Meanwhile, the group tries to reinforce its number one position in the PC sector with leading profitability and accelerate innovation-led growth in non-PC and adjacent areas, including accessories. Our strong financial position provide us a solid foundation to proactively pursue growth opportunities ahead. Finally, as always, we remain committed to driving sustainable growth and profitability improvement for our shareholders. Thank you. We will now take your questions. Thank you, Wai Ming. Now we are open the line for questions, and this session will be in English only. Please be reminded to limit yourself to two questions at a time. Operator, please give us your instructions. To submit a question, please type your question in the Q&A box on the right and click Submit. Thank you. Our first question is coming from Duane Tan, from Nomura. The first question is: What would be the reasonable operating margin for IDG business? Would it be going back to the pre-COVID level? Yeah, can, Luca answer the question, please? Yes, of course. Good morning, good afternoon to everyone. Look, in Q1, our IDG operating margin was 6.3%. Looking forward, we aim to maintain a superior operating margin than what was in pre-COVID. We think this could be driven by improved commercial and also premium mix, and higher penetration rate, range, sorry, of attached services, and also a better design to cost, which is helped by our very strong R&D capabilities. Also, higher ASP, average price, will contribute to a better operating scale, paired with tight expense management. Thank you. Thank you, Luca. Luca, I don't know whether 6.3 is higher or lower than the pre-COVID. I think at least it's equal. From profitability point of view, I don't think it's 6.3 is lower than pre-COVID, but definitely we still have room to improve, for sure. Yeah, I think it's in the range of pre-COVID, and depending on the quarter, also the scale plays a very important factor. But for sure, we, we, we aim to do better than pre-COVID, that's for sure. Thank you both. We have the second question also coming from Nomura. Second question is on AI opportunities. Could you elaborate more on the progress of AI server projects by adopting NVIDIA's A/H GPU series? Are we going to have project by using NVIDIA solutions? AI PC, what would be the incremental content goals, and what kind of new ICs or components would be, would be added or upgraded to? Yeah. It was, split into two two answers. Probably, Kirk will answer the first part. Sure, Wai Ming. Definitely, thank you for the question. Lenovo is absolutely committed to deliver real user value on AI from the pocket to the cloud. As we discussed, we've now further invested $1 billion to accelerate this AI innovation and deployments. I think we're seeing tremendous demand. Let me share with you a few proof points on why we're excited about AI and the growth. First, per IDC's latest report, our infrastructure AI business grew 139% year-over-year, and we've now grown over the past few years now to number three in the world for AI infrastructure. We've said that we now have over $2 billion in revenue from the ISG business on AI. We launched this AI Innovators Program, and we now have over 65 AI-optimized platforms in the market. To your question, we'll be launching additional products as we get through the fiscal year. We've had 45 ISV partners that are now delivering over 150 AI solutions into the market, and we have now over 100 active proof-of-concepts into the marketplace. We also were public that we are the leading provider of Omniverse and OVX in the cloud, partnering with NVIDIA and with Microsoft. We just recently announced a new product called the SR-675, with the new NVIDIA L40S GPU, where we're gonna further extend our leadership with 8-GPU support for generative AI, for metaverse simulations, and for other parts of AI. Lastly, yes, you're correct. We were, we are partnering with Microsoft, NVIDIA, AMD, Intel, and Qualcomm, and plan to have leading solutions across all these areas. With that, we expect the AI market to be growing at at least twice the market. We plan to extend our leadership position. Thank you. Thank you, Kirk. Luca, can you talk a little bit? Yes. A little bit more on the AI PC? Yeah. AI PC will be an inflection point for the entire PC industry, and we believe it will be driving a significant replacement cycle that is valid for commercial and consumer segments. Today, AI is already present in our devices with our own IP, but what we are talking now for the future AI PC is a new class of devices with a dededicated NPU that will allow a certain level of inferencing at the edge. There will be several innovations with great productivity features, security, privacy, improvements in battery life, improvements in form factor. We think that we can be, we will be a great beneficiary of this AI PC trend, given the possibility for us to leverage our pocket to the cloud offering, including our edge to cloud collaboration, multi-OS, multi-device R&D efforts that we have done now for a long time. Thank you. Thank you, Luca. Thank you. Thank you, Luca. you. Thank you, Luca. you. Thank you, Luca. Thank you, Wa i. For now, we have two questions coming from Albert Huang with JP Morgan. Question one, could you elaborate details regarding to where Lenovo is going to invest in AI? Where does Lenovo see the addressable market to be in AI for data center and PC? Question two, how quickly could Lenovo monetize this AI investment, i.e., its contribution to the total revenue, and what is going to be the growth rate in the next two to three years? Okay, thank you, Albert, for the question. Actually, AI is not new for Lenovo. For years, we have been embracing AI from all aspects. We have built our advantages in computing power from client to edge, to cloud and network. As Kirk just said, we are investing a further $1 billion over the next three years in AI-driven innovation. No doubt, recent breakthrough in large language model or AIGC marks a major leap in AI development and application. Although it's just one part of the AI narrative, but we believe it's a catalyst and accelerator that will boost the adoption of AI so that it becomes relevant and real to the average person. This is definitely consistent with our 3S strategy. More powerful infrastructure with GPUs, NPUs, or heterogeneous computing. Certainly more powerful devices, as Luca just introduced. This is because more inferencing, more inferencing will happen at the device side in the future, whether it's for accessibility or privacy protection consideration. We are leveraging this wave to drive our business growth, addressing the real market beyond the hype and executing our strategy. We will spend our money to make our devices more powerful or more AI ready and optimized. Like Kirk and Luca just introduced, AI PC, AI smartphone, AI server and storage are definitely our focused area. Actually, we probably will continue to embed this new AIGC technology into our smart vertical solutions to help our customer, enterprise customer to improve their productivity as well. We are definitely collaborating with partners like Microsoft, Qualcomm, and MediaTek, in Intel, NVIDIA, to build our next-generation product roadmap and solution portfolio together. Our partners value us not just because our road -to- market capability, our design capability, but particularly our capability to develop across ecosystems. Windows, Android, and across the silicons. x86, ARM, et cetera, et cetera. We definitely believe so we are a leading company in providing the AI ready, AI optimized devices and infrastructure. Thank you. Thank you. The next question, two questions are coming from Mr. Howard Kao from Morgan Stanley. First question: Can you talk about your PC inventory levels and how you view PC margins trending over the next couple of quarters? Also, how do you view the total PC time for 2023 and 2024? Question two on ISG: Can you talk about the challenges you are seeing for the cloud? Any color on why the business went to losses again, is it due to ASP pressure or mix change? Where do you think ISG can go back to the profits? Okay, Luca, first question is yours. Thank you, first one, Yuanqing. Our channel inventory level have now been corrected, and we are operating at a similar level of the channel inventory as the pre-COVID. We are comfortable with this level, we look cautiously optimistic at the second half to see shipment grow year-over-year, driven by our record activation share, normalized channel inventory, as I mentioned, improving underlying demand, and of course, more favorable comparison with the second half of last year. In regards to the PC market, we think it will end up at the low end of our guidance for this year, so around 250- 155 million. We expect a single-digit growth in 2024, helped also by the Windows 10 end of life from Microsoft, then an accelerated growth in 2025 with a massive AI PC launch. In regards to the margin, despite the competition has intensified, we are working hard to maintain the same or better margin level, and that is driven by several actions, including mix, segment and product mix, procurement scale, our design to cost ability, and also many product portfolio optimization programs that we have launched one and two years ago, as well as a strong OpEx discipline, among other sections that we are taking. Thank you. Yeah, Kirk, second question for you. Sure. Regarding the cloud and the dynamics we're seeing there, you know, I think inherently the cloud is a little lumpy because of the large customer base of the hyperscalers. We believe that if you look at calendar first half of the year, we actually executed at a double-digit premium-to-market. If we look at this current quarter, I think we had some highlights and then some slowdown areas. As you saw, we grew our storage business more than 120% and crossed over to become the fouth largest storage vendor in the world, and number 1 in price bands 1 through 4. Storage is doing extremely well for us. AI infrastructure, like I said, grew 139% year-over-year, but we are seeing GPU constraints. In general, there's a move from server compute, like general purpose compute, over to AI workloads that's constrained by GPU. There is inventory consumption happening given the global macroeconomic environment. We saw a slower than expected transition to the new DDR5 platforms based on the premiums on DDR5 and the overall value proposition of those. Having said that, I think we are highly confident that as we go through our fiscal year, we're going to see an improvement from this quarter's results in the cloud and in enterprise SMB. As the world pivots more to AI, and we have these 65+ platforms launching into the market, as well as our consistent expansion in storage, which obviously is well over a 100% premium-to-market. Thank you. Thank you, Kirk. The next question is from Mr. Kumar with TechInsights. This is on smartphone. What are the key markets for Motorola smartphone business? What will be the key focus areas for the next one year? How was the foldable phone device performance. Buniac is online? No, not online. Yes. The key markets for Motorola are clearly Latin America, where we hold the strong number two position with over 20% of market share. The second strong hold is North America, where we are number three, and we continue to see opportunity to grow. In EMEA and AP, Asia-Pacific, these are the geographies where we are hyper-growing. When the last quarter, we had more than 20- points of opinion to the market in each of these two geographies. What are the priorities in the next year? I think we are putting a lot of focus on premium franchises, like our Edge and the Razr, franchise, which represented close to 20% of our shipments and revenues in Q1. Within this, you were asking on the foldable, we are very happy with our Razr launch. This is our 4th generation. Just to give you an idea, in the first 120 days from the launch, we have shipped more than 3 x what we shipped for the three generations of the previous Razr combined. We are receiving phenomenal feedback from the channel and end users, so it's giving us a lot of confidence on our strategy to balance the scale with also a presence in the premium segment, particularly in the innovative foldable segment. Thank you. Yeah. Regarding of our smartphone business, although last quarter declined as much as PC, but I'm less worried about that. As I said at my opening, actually, from an activation point of view, last quarter was the highest Q1 in 10 years. This business is just consuming the channel inventory. I think it should leave us more room to grow in the coming quarters. Thank you, Wang Wai. Yes. The next question is coming from West Chen from UBS. Could you comment on the outlook of enterprise server and general servers for 2024? Sure. This is Kirk. I think if you look at our fiscal year and you look at the IDC reports, generally speaking, they're expecting a flat market. I think there'll be another quarter of inventory digestion by the large clouds and a pivot over to AI. As we get into the second half of this year, we believe we'll have significantly improving results, based on the portfolio and the demand we see. As I, as I said earlier, we're seeing records across the business in general purpose and enterprise. We've had nine consecutive quarters of growth on our edge server business, with another double-digit growth quarter. We had 45% growth in HPC, retaining our number one position on the TOP500 and number one on the Green500. Server-based storage is growing, like I said, for us, well over a 100 point premium-to-market. Our profit drivers underneath that, storage, services, and software, are all growing at records this quarter as well. It really is just a pause by the hyperscalers, I think, and that we see in the second half of the fiscal, AI and overall demand coming back. Thank you. Thank you, Kirk. The next question is coming from Ben, with Technology Business Research. His question is, TruScale DaaS deals. Since the launch of ThinkPhone, have you seen the material increase in terms of the number of TruScale DaaS deals, including the smartphone? Overall, how would your TruScale DaaS signs trending in the last couple of quarters? Yeah. Ken Wong, our SSG President, will answer the question. Okay. Hey, thank you, Ben, for your question. Good afternoon, good morning, everyone. Overall, we see, we continue to see a strong demand from overall as-a-Service, which cover from pocket to the cloud, right? Starting from smartphone, PC, tablet, all the way to infrastructure. This is also in line with the market data that we have seen from Gartner and IDC. This is continued to be the sweet spot of the market in terms of growth. Now, regarding some of the demand that we see in the market, right, definitely, device as-a-Service continue to grow. We see pockets of opportunity around high-performance computing and hybrid cloud, even faster, more demand coming from our customer. Especially about phone, right? When we look at the past few quarters, right, even, especially when we look at our internal data and also to our interaction with the customer, the demand for phone in the business scenario is getting more, right. As a result, right, our TruScale offering is exactly addressing the customer requirement. At the end of the day, the customer is looking for a one-stop solution, spanning across all devices and infrastructure within the enterprises. Thank you. Ken. Next one. Thank you, Ken. Yes, the next question is coming from Mr. Desmond Ling from DBS. The company has been showing strong working capital management in the current quarter. Can you give some guidance on working capital trend, going forward? Yeah, Wai Ming, as CFO, will answer the question. Desmond, thank you for the question. We definitely put a lot of effort in improving our working capital. Especially if you look at our balance sheet, we actually kept the inventory down by nearly $3 billion year-over-year, as well as continuing to improve. That trend will continue. We will continue to improve how we actually manage our capital, because one of the key priority for us is to keep the company very liquid, so that we will generate more cash, I think, to invest in the growth area. Thank you. Thank you, Wai Ming. We have the next question coming from Mr. Dutt, with Canalys. On commercial PC recovery in end of 2023 and start of 2024, are you seeing any difference in demand, strength between SMB and enterprise? Thank you. Yeah. So, Luca? We see our commercial relational segment at this point of time to be stronger than the SMB. Also with a good outlook for the second half and the pipeline for 2024. SMB has been impacted in terms of the shipment, also by the channel inventory correction, is that SMB is a business model where channel plays a bigger role than the pure commercial. That is probably a significant difference that shows up in the performance so far year to date. We think SMB will return to grow as well, with the inventory, as I said, being normalized and the underlying demand stabilizing in the near term. The demand in SMB, I would probably say that is the one more impacted by the macro, macroeconomic condition. Hopefully, we will also see a relaxation in 2024 of that macro to get more natural demand from SMB. Commercial, at this point of time, we see it stronger than SMB. Thank you. Thank you, Luca. The next question is coming from Dino Chen, from Grand Alliance Asset Management. Could you please share with me the label of both margin and operating margin of AI server business, compared with those of general server business, please? Thank you. Yeah, Kirk. Hi, Kirk? Yes. You unmuted. I'll answer the question, sure. The answer is probably based on segments. I think in the edge, we're seeing amazing new use cases with these over 150 solutions and these POCs, where our edge margins are likely improving because of the AI workloads that are getting put on them. We now have the densest edge server in the world, with more GPU support, and we're seeing proof-of-concepts at more than half of the global fast food chains, for example, because of that. In the cloud, I think it's a very aggressive and fierce competitive market. I would say in storage, our growth of 120% year-over-year is driven again, because we're putting more and more AI into our storage business as well. You can see that in the most recent announcements we've had. I would say it's a mix. In the cloud, it's very fierce competition and probably lower margin. In edge, storage and general purpose, we're delivering real value to the customer that's helping us improve margins a bit. Thank you. Thank you. Thank you. Yeah. Thank you, Kirk. This is going to be another question for Kirk as well. It's from Mr. Fong with TBR. He is asking, "Given ISG's strong storage business over the last year, how should we think about the growth potential over the medium term, specifically one to three years, with regard to the ODM+ contract ramp-up versus enterprise? Yes. Yeah. I think we're very excited about our storage growth that we've had. Again, in a market that's growing at low single digits, we're well over 100% year-over-year, with 120% growth. Again, we crossed over to be number four in the world overall, and now number one in price bands one through four, under $25,000. Our growth is in the entry, traditional NAS and SAN, in the mid-range, in software-defined, in cloud, in high-performance computing. We're seeing records in our storage business, essentially in almost every part of the world and every piece of our of the segments we participate in. Relative to the growth rates, I think we're challenging our segment managers to continue to grow at a premium-to-market in every piece of the business. We will have new cloud storage designs, and we think we'll continue to grow at a significant premium market in cloud. We've also had new partnerships with partners like Weka, where we're seeing growth as well. I would say all aspects of our storage business continue to be very exciting for the horizon. Thank you. Thank you. Now we also have our next question from Mr. Guo with Fullerton Fund Management. His question is on ISG as well, which recorded operating loss of $16 million. Is this related to investment in AI products or revenue bookings? Yes, I would say we have confidence in our long-term strategy, we think we'll continue over the long term to ramp our revenue at a significant premium-to-market while continuing to improve profitability. Again, if you look at the first half of the year calendar, we executed a premium-to-market. I think this is a temporary issue as the cloud pivots to AI. They're consuming inventory of server compute and pivoting that to storage and AI use cases. As we get into the second half of the year, that will significantly improve. In the meantime, because of the lower than expected revenue, we're continuing to invest, for example, in AI and in storage, to generate these 100+% growth rates like we've shown in AI and storage, 50% growth in software, 45% growth in HPC, nine consecutive quarters, now double-digit growth in the edge. I think this is a temporary phenomenon, and we're confident in our long-term revenue and profit improvement strategy as we go towards the second half of this fiscal year. Thank you. Thank you, Kirk. This is our last question for this webcast. I would like to invite Yang Yuanqing to give us a very short remark. Yuanqing, please. transcript of a speech given by an individual. Yeah, so definitely, the short-term macro economy is very challenging. It impacted our last quarter's performance. But for the remaining quarter of the fiscal year, we are still cautiously optimistic. We think the overall device market is stabilizing. We have finished the channel inventory digestion. From now on, shipment will be consistent with the activation. We are confident quarter over quarter We will, we will see the improved performance, no matter it's in the top line and or in the bottom line. To protect our bottom line, we, we, we announced our $850 million cost saving plan. We are, so far, we have been above the track, but probably we, we will take even more actions to ensure our expense is consistent with the forecasted revenue, so that we still can deliver a rather stable profitability to our, to our shareholders. Definitely AI is our another opportunity. We will invest more money in that space based on our current edge server, edge cloud, and network and intelligent architecture. We think we will be a leading company in the AI-related devices, AI-related infrastructure and AI-related vertical solutions and services. That's my summary for for the last quarter and the future. Thank you. Thank you, Yuanqing. We also want to thank you everyone for joining today's call. If you have any further questions, please feel free to contact the IR team directly, and the replay of this webcast will be available in the next couple of hours on our investor relations website. Thank you again for joining us. Bye-bye. Bye-bye.