Thank you very much for joining the conference call for financial briefing for the third quarter FY 2021 of Advantest Corporation, despite your busy schedule. Today's participants are President and CEO, Mr. Yoshida; CFO, Mr. Fujita; Chief Customer Relations Officer, Mr. Sakamoto; and Co-Chief Strategy Officer and Chief Stakeholder Officer, Mr. Mihashi. Today, Mr. Fujita will present the financial results for the third quarter FY 2021 first, followed by FY 2021 outlook by Mr. Yoshida. Then, we'll take your questions. We're scheduled to close the meeting 4:30 P.M. The presentation material is available on TDnet and on our website. Let me go through disclaimer statement in advance. This presentation contains forward-looking statements based on the current estimates, and they contain risks and uncertainties. Actual results may be different from the estimate, and we appreciate your acknowledgement in advance. Now, Mr. Fujita will lead the presentation. Good afternoon, everyone. This is Fujita. I'll present the financial results for the third quarter FY 2021. Please turn to page 4 of the presentation material for the summary of the third quarter results. Let me review the business environment in the third quarter. As in the previous several quarters, our business environment in the third quarter continued to be favorable. Aggressive tester investment was driven primarily by SoC semiconductor manufacturers amid trends that are structurally boosting the level of tester demand, such as expanding data center investment, higher 5G smartphone functionality, and semiconductor performance gains, including further miniaturization. On the other hand, the shortage of semiconductors remains unresolved. Since semiconductor testers use a significant number of semiconductors, we continued to face production difficulties in the third quarter. However, we made a company-wide effort to secure the necessary parts, and were able to achieve sales and profits that exceeded our expectations of three months ago. As a result, third quarter results include the record high quarterly sales and operating income since we began quarterly disclosure. Details will be explained in the following slides. Please turn to page 5. Third quarter orders by segment. In the second quarter, due to our extended product lead times, customers made production plans farther in advance, and we received many orders placed earlier than the conventional timing with respect to our lead times. Although our product lead times have not come down in the third quarter, the advanced ordering trend that occurred in the second quarter has subsided considerably. We believe this is the reason for the significant quarter-on-quarter decrease in orders in the third quarter. Semiconductor and component test systems. Orders were JPY 102.5 billion, down 39.5% quarter-on-quarter. Orders for SoC testers were JPY 85.7 billion, down by JPY 62 billion quarter-on-quarter. However, as shown in the graph on the right, demand for SoC testers is steadily increasing compared to last year and the year before last, mainly for high-end devices. Orders achieved a level higher than our internal forecast three months ago, and we believe that customers' investment appetite is still strong. Memory tester orders were JPY 16.8 billion, down by JPY 5 billion quarter-on-quarter. Orders for DRAM testers, which had been strong for some time through the second quarter, are taking a pause here, but this is in line with our expectations. Mechatronics systems orders were JPY 11.4 billion, down 35.3% quarter-on-quarter. Mechatronics orders decreased in step with the fall-off in tester orders. Service support and others orders were JPY 22.4 billion, up 34.8% quarter-on-quarter. On top of continuing annual maintenance contract renewals, system-level test orders were strong. Slide 6 shows the third quarter sales by segment. Amidst continuing parts shortages, sales trended above our internal forecast. For semiconductor and component test systems, sales totaled JPY 80.2 billion, up 33.7% quarter-on-quarter. Breaking that down, SoC tester sales were JPY 63.1 billion, and memory tester sales were JPY 17.1 billion. SoC tester sales were higher than expected, mainly for high-end SoC devices used in smartphones and servers. Memory testers performed well overall in both the DRAM and non-volatile memory categories. However, sales undershot expectations as some customers revised their investment plans. Mechatronics systems totaled JPY 10.9 billion, up 14.9% quarter-over-quarter. Services, support, and others totaled JPY 21 billion, about the same as in the previous quarter. Slide 7 shows orders and sales by region. First, the orders. In Taiwan, South Korea, orders decreased in a reaction to the second quarter's surge, triggered by longer lead times for our products, which has now subsided. China saw strong orders for testers for display driver ICs used in TVs and smartphones in the third quarter. As for sales by region, shown on the right, sales to South Korea declined slightly, but overall sales were on a growth trajectory. Slide 8 shows P&L related figures. Gross margin was 57.9%. Our sales mix shifted towards more profitable products. SG&A, including all other income and expenses, totaled JPY 31.3 billion. Support and other expenses increased fractionally following growth in revenues. Operating income was JPY 33.5 billion, with operating margin at 29.9%. Slide 9 shows the third quarter R&D expenses and others. R&D expenses totaled JPY 11.8 billion. R&D expenses to sales ratio was 10.5%. CapEx amounted to JPY 4.8 billion. In the third quarter, we continued to steadily invest in the expansion of our U.S. manufacturing base, which began in the second quarter. Depreciation and amortization totaled JPY 3.9 billion. Cash flow is shown on the right. Free cash flow was net outflow of JPY 16.6 billion. Due to our acquisition of R&D Altanova in November, cash flows from investing activities increased in the third quarter, and free cash flow became negative. Slide 10 shows the balance sheet as of December 31. Total assets were JPY 462.3 billion. Cash and cash equivalents totaled JPY 121.7 billion. Goodwill and intangible assets amounted to JPY 80.7 billion, an increase of JPY 26.6 billion quarter on quarter, reflecting our acquisition of R&D Altanova. As final figures for purchase price allocation, or PPA, are not yet available, we have booked goodwill and intangible assets based on provisional estimates. Among liabilities, short-term borrowings totaled JPY 28.7 billion. As we continue to make aggressive investments in the U.S., such as the acquisition of R&D Altanova, and expansion of our production base there, we have raised the necessary funds through short-term borrowing. Equity attributable to owners of the parent was JPY 281.5 billion. Equity ratio was 60.9%, down 4.9 points quarter-on-quarter. The progress of our share repurchase is disclosed in our filing. By the end of December, 4.68 million shares of common stock had been acquired for JPY 45.7 billion, accounting for 47% of our upper limit of 10 million shares and 65% of our upper limit of JPY 70 billion. That concludes my presentation on the third quarter results. This is Yoshida. I will present the outlook for FY 2021. Please turn to page 12. Semiconductor tester market trends. Ongoing semiconductor performance gains and growing production volumes made 2021 a very active year for the semiconductor tester market. Although this is preliminary figure, the value of the semiconductor tester market in 2021 is thought to have been about $5.4 billion, increase of about 30% year-on-year. Various changeable factors may affect the 2022 tester market, such as our lead time situation, and the visibility is poor, but we expect SoC tester market growth to range from about 10% to slightly over 20% year-on-year. Breaking this down, we expect that automotive, industrial, and consumer-related semiconductors will make further gains in 2022. At the same time, leading-edge products will continue to play the role of growth driver. For the past decade, smartphone application processors have been the forefront of semiconductor performance gains. In 2022, we expect high-performance computing devices to take the lead. Memory tester market growth is expected to range from slightly below 10% to 15% year-on-year in 2022. The trend toward memory device performance gains, including greater density, faster speed, and higher bandwidth, is promoting the growth of the test market. We still cannot make any clear and quantitative predictions about 2023 and beyond. However, we believe, even if the current serious shortage of semiconductors resolved, structural demand for semiconductors will continue to grow. Further miniaturization and further improvement in semiconductor integration through the adoption of advanced packages will generate demand for more sophisticated and more highly integrated test solutions. We believe that the tester market will continue to grow over the medium to long term despite minor adjustment. Please turn to page 13, FY 2021 forecast. Based on our results through the third quarter and our outlook for the fourth quarter, we have revised our full year forecast upward. Orders are now expected to increase by JPY 85 billion- JPY 650 billion. Sales and operating income are expected to increase by JPY 10 billion- JPY 410 billion, and JPY 115 billion, respectively. The net income is expected to increase by JPY 7.5 billion - JPY 86.3 billion. Our current priority is parts procurement, and we cannot yet be optimistic here. Sudden delays in the delivery of parts may occur, and we cannot assume this presents no risk to our achievement of our fourth quarter sales plan. That said, we are working to secure necessary parts and expect to set new sales and profit records for the second consecutive year. Gross profit margin is expected to be around 57% for the full year, as our product mix in the second half is better than it was three months ago. SG&A expenses in the fourth quarter are expected to be flat or slightly down from the third quarter. The forecast is based on the exchange rate assumptions of USD 1 to JPY 115, and EUR 1 to JPY 130 for the fourth quarter FY 2021. Our latest forecast for the impact of exchange rate fluctuation on FY 2021 operating income is +JPY 1 billion per JPY 1 of Japanese yen depreciation versus U.S. dollar, and -JPY 150 million per JPY 1 of Japanese yen depreciation versus euro. As announced in November 2021, we acquired R&D Altanova and started financial consolidation from the middle of the third quarter. However, the impact on our business results for the current fiscal year is expected to be minor. Slide 14, FY 2021 outlook by segment. As for semiconductor and component test systems outlook, our full year sales forecast for SoC testers is JPY 218 billion, up JPY 16 billion from our October forecast. The increasing complexity of testing APU (application processors), HPC (high -performance computers), and other devices due to miniaturization continues to drive strong demand for testers. Customer motivation to invest in automotive, industrial, and display test has remained high, and strong orders for SoC testers continue. Our full year sales forecast for memory testers is JPY 62 billion, down JPY 10 billion from our October forecast. As you can see from our orders, demand for DDR5 - the next generation DRAM - and non-volatile memory is solid, as a whole. We lowered our sales forecast in light of certain customers revising their investment plans in the second half of the year. Slide 15. Our full year sales forecast for mechatronics system is JPY 45.5 billion, slightly lower than the October forecast. We have raised our full year sales forecast for the services and other segment by JPY 6.6 billion to JPY 84.6 billion. Currently, our system level test business mainly targets high-end SoCs. As seen in our SoC tester outlook, test demand in that area is growing more than expected, raising our expectations for the full year. Also, in the system level test business, we plan to strategically increase recurring revenue as a percentage of sales through aggressive M&A and flexible capital investment. We will continue to steadily implement business expansion measures and promote the diversification of our earning space. Slide 16 is the summary. 2021, a very strong year for the tester market, is over, but our business discussions with semiconductor manufacturers indicate that there is currently no sign of demand declining anywhere. The direction of the semiconductor market and the final product markets prefigures continued active investments in test capacity to improve the performance and reliability of semiconductors in 2022. In order to keep up with our customers' appetite for investment, we will continue to make stabilizing parts to procurement a priority. In view of future sustainable expansion of our business opportunities, we will steadily promote measures for medium to long-term business growth and greater resilience. Our sales have almost doubled in the four years since 2017. We see the need to steadily strengthen our internal control system in line with the expanding scale of our business. We will improve operational excellence by responding to shifts, such as changes in work styles and lifestyles triggered by COVID-19, ESG related changes in the capital markets and society, et cetera. Demand is strong, but we are aware of the risk of new issues emerging just when everything seems to be going well. We will work on early achievement of our midterm management plan targets while being fully alert to such risks as worsening of parts procurement due to supply chain bottlenecks and logistical difficulties, decline in demand due to slowdowns in the global economic recovery, potential impacts from U.S.-China conflict, and economic security policies on the semiconductor industry, as well as geopolitical risks, such as the recent Ukraine-Russia tensions. Thank you for your attention. We will proceed to Q&A session. The question is from Mr. Wadaki of Nomura Securities. Thank you for the striking financial results today. One question per person, so firstly, I'd like to ask about the order forecast that you revised upward this time. Let us know its content, and don't you have any concern for the slowdown that was presented by Teradyne? This is Sakamoto. As for the orders in the third quarter which showed upside, I'd like to make some comments. Orders were up by JPY 36 billion, and as for the breakdown, SoC tester was up JPY 27 billion. As mentioned before, the customers' demand for high-end devices, including APU and HPC, has been increasing. The demand for DDIC is also picking up. A mix, the SoC order in the third quarter is 70% by computer communication, 15% by automotive, industrial, and consumer-related, and 15% by DDIC. Memory was in line with expectation. Mechatronics was up JPY 3 billion, boosted by device interface, and service was up by JPY 6 billion, half of the increase was by SRT. As for the full year forecast, it was revised up by JPY 85 billion, with JPY 70 billion upside of SoC tester and JPY 15 billion of service and others. Not only for the leading-edge chips, but overall SoC tester is expected to grow. Service and others growth will be driven mainly by the growth of SRT. Yoshida speaking. You may have the impression of a slowdown due to the peer's announcement, but the difference between us and the peer is that we have extensive customer base for high-performance computing. It remarks the strong growth. That is demonstrated by the growing orders. Test time is getting longer for the leading-edge process, and this strength is a source of the differentiation. Thank you very much. As a follow-up question, Mr. Yoshida now commented on HPC, and it will be the future pillar of the business. When you say HPC, do you mean GPU or Arm core? And if it is GPU, would you give us the background of the longer test time for GPU? Thank you, Mr. Wadaki. This is Mihashi. We categorized as HPC, high-performance computing, and that includes graphics processing unit, as you mentioned, and diverse accelerators for processing and high-end FPGA. High-end applications for data center are included here. This is not only for GPU. Well understood. Thank you. Thank you very much. Thank you for the question. The next question is from Mr. Yoshida of CLSA Securities. This is Yoshida of CLSA Securities. Do you hear me? Yes. You presented the market estimate for this year, $4.5 billion-$5 billion for SoC, and $1.4 billion-$1.5 billion for memory. You talked about the difference between you and the competitors. How do you see the share dynamics? Presumably, as you mentioned, your HPC customers will adopt more 5 nm, and I assume that will lead to your share gain. Would you comment on the share dynamics of SoC and memory from the previous year to this year? Mr. Yoshida, this is Mihashi. I take that your question is about the comparison between the calendar year 2021 and the calendar year 2022. Is that right? Yes. Share dynamics is clearly affected by customers' business trend. As for the next year, according to our market forecast, though it is slightly hard to tell, competitors' customers' business trend will slow down. Naturally, it will lead to our share gain. Next year, our share in computer communication will grow. Besides the share gain in high-end products, we expect substantial market growth of automotive, industrial, and consumer-related next year as well. We included the share gain in those markets in our forecast for the year. As for memory, I said before that HPC will push up the SoC business. With the growth of high-end performance computing, on memory side, HBM2, GDDR6 graphics, or DDR5, such DRAM application will be growing next year. Based on this, we bump up the market estimate. In these areas, we expect that our customers will move actively next year, and that will result in our share gain. Thank you. You expect to gain share both in SoC and memory in 2022, do you? Sakamoto speaking. As Yoshida mentioned before, we expect in 2022, HPC will gain strong momentum. We didn't have high share with it, and through customer engagement, we will gain share and boost sales. Data center demand will grow and the full-fledged mass production will launch for DRAM and DDR5. As we have strong share in DRAM, we will gain share in this area as well. We will achieve strong share gain in SoC and memory. Thank you. As a follow-up question, you commented on the direction in 2022, but further down the road toward 2023, you gave us some colors before that the growth will be sustained. Toward the 2023, with the rollout of 3 nm, competitors' customers will increase investment. How shall we see your business toward 2023? For 3 nm, you may have new customers who are not the customers of competitors, but can you capture new business at the launch of 3 nm? How should we see your prospect for 2023? Yoshida speaking. Given the 30% growth in 2021, 20% in 2022, you may wonder the sustainability of the growth in 2023. I'm not optimistic either. Currently, with the longer lead time, order level has been high. When the lead time is shortened, the growth in orders will be slowing down. We have high expectation for the node development from 5 nm to 3 nm. With the progress, the testing is technically getting more difficult, and customers are also wondering how to test products. This is the area where we can leverage our strengths with the stronger appetite for technology buy. We may observe overall slowdown, but in our prospect, demand for test for new technology will be sustained in 2023, 2024, and 2025. I see. Thank you. Thank you for the question. Next question is from Mr. Damian Thong of Macquarie Capital Securities. This is Damian Thong of Macquarie Capital. Do you hear me? In your guidance for the fourth quarter, OP margin is considerably high. It might be the record high, 30.9%. Your order backlog is high, and the ratio of SoC tester is also high. As for the OP margin for the next year, will it be sustained, or will it increase further? Would you conceive any upside potential and downside risk? The forecast on page 13 shows the operating margin for the fourth quarter as 30.9%. This is supported by the favorable product mix. Given the order backlog of SoC, I expect the similar level of OP margin is achievable in the process of working on the order backlog. We also expect the cost increase in parts, logistics and labor, so the actual situation is highly uncertain. We have not secured all the parts for 2022 yet. Given those concerns, if we can achieve the guidance for the fourth quarter, you can take the next year will be close to this level. Thank you. Supply tightness of semiconductor will continue everywhere. In your visibility, how much of your need for the next year is already secured? With a growth of 20% for SoC tester, how much can you cover in your supply chain? Are you asking about our supply chain, not about the entire semiconductor? Your supply chain of semiconductor and non-semiconductor, how far order backlog can you manage? 6 months or 9 months? How much remaining risk do you have now? Even for the sales in the fourth quarter, I said in the presentation that I cannot say no risk. In the very tight condition, we are negotiating with our suppliers. Unfortunately, at this moment, we cannot comment about what will happen, in what timings through the year. This is not our unique issue, but automotive and many other companies share the same issue. For some product, due to the economic slowdown in China, inventory built up will halt, and excess generated there might relieve pressure on other semiconductors. This might mitigate the supply-demand tightness. I hope you understand that we cannot specify the timing and how it will be resolved clearly at this moment. Understood. Thank you. However, our customers are also serving as suppliers, so despite the strong customers' request for testers, actually we cannot produce due to the lack of semiconductor. Such situation has been ongoing. Through various channels, now we are trying to build momentum to prioritize SPE in supply of semiconductor. Thank you for your detailed explanation. Thank you for the question. Next question is from Mr. Hirakawa of BofA Securities. Thank you. I'm Hirakawa of BofA. I also would like to ask about the parts procurement. I'd like to hear about the current parts procurement environment compared to three months ago. Has it changed, or remain unchanged, or getting worse? Has the parts shortage changed? Let us know the change from three months ago. The issues visible three months ago remain unsolved. In our case, the parts shortage is very limited in that they have not expanded. Since they are semiconductor parts, for the sudden production increase demand, if fabs have extra capacity, that will be duly responded. Actually there is no such extra capacity, and that's ongoing. If there is a demand for production increase, priority in the fabs needs to be adjusted. As a result, whether any improvement is observed from three months ago, we do not feel so. We do not see the aggravation either. Orders have been increasing further, and we need to place additional orders for suppliers, but suppliers cannot respond immediately. I see. Thank you. A follow-up question. I'm always impressed with Mr. Yoshida's cautious remarks. Now, you are expecting the SoC tester market to grow by 10%-20%, and you are expecting over 20% growth in your revenue. True, you did say you haven't fully secured all of the necessary parts for that, but I got the impression that you actually have pretty good prospects for satisfying the procurement requirements. Can you elaborate on that? We are providing our suppliers with a longer-term forecast together with purchase orders being placed early on. True, we believe that the volume of secured parts should increase from what it is today. But the question is, can we really secure all the amount for sure with absolute certainty? Well, many things could happen with semiconductor supplies, including some unexpected defects. In that sense, we do not have a full visibility. There are some wafers that have yet to be loaded. There are risks in that sense. Keep in mind that we will start from the order backlog of JPY 350 billion. At the current rate, that JPY 350 billion worth should be shipped in less than a year. We do have actions in place to procure the necessary parts. The point is, we are taking actions, but whether they would ensure the full amount is not 100% sure. I see. Thank you. Next is Mr. Nakamura from Goldman Sachs. Thank you. You said system level test demand at the present moment is very strong. Can you elaborate on the background? I understand that it is in conjunction with strong demand for SoC testers, but is it due to an increase in the number of customers or is it due to increase in applications? This is Mihashi speaking. The background for strong SLT demand is, as you indicated, the system market itself growing, basically starting from APU and other mobility applications to high-end and/or automotive applications. In addition, we are focusing on recurring consumables business related to SLT hardware and system sales. The combination of the two are driving the current strong order levels. I see. In that sense, it's not the increase in customers but increase in applications. Am I correct? Yes, but increased applications also entail increased customers. I see. A follow-up question on profitability. Current profitability or the operating, the profit margin of a system level test is what I have a question on. How does it compare to your overall company-wide profit margin? Profit margin of system level tests is not very different from that of ATE profitability overall, so pretty high. The new acquisition has yet to be included, but the profit margin of the two previous acquisitions, as well as the business for SSDs, is not very different from that of SoC tester or ATE overall. I see. So that means a margin of over 30%, correct? Do you mean gross margin? No, operating margin. Actually, none of our businesses have reached over a 30% operating margin yet. It's a little less than that. Our internal projection of a 30% is overall for the fourth quarter, so it could be close to 30%. Maybe ATE is a bit higher. I see. That's helpful. Thank you. That's all. Next is Mr. Hasegawa from Mitsubishi UFJ Morgan Stanley. Thank you. I would like to ask further on memory testers. I know it's a delicate subject, but you mentioned some customers revising their investment plans. Can you elaborate on that to the extent possible? Also, what about other factors? This is Sakamoto speaking. Yes, some customers revised their investment plans, but I will refrain from giving specifics. One thing I can say for sure is that while we revised the guidance downward by JPY 10 billion, it is not due to order cancellations or competitors taking our market share or slowing down of the market. We regard this as the postponement, which shall contribute to the FY 2022 sales. I see. What about other customers or applications such as DRAM and NAND? Market is very strong. As for DRAM, as mentioned earlier, customers are investing to prepare for the mass production of DDR5, the same for LPDDR5. As for NAND, manufacturers are adding more layers. They have plans for that and are executing that. Both DRAM and NAND-related investments are very active, so we will make sure we capture that momentum. I see. Investment plan changes are limited only to specific customers. As far as other customers and applications are concerned, strong investment momentum continues. Am I correct? Yes. You talked about gaining more market share next year. Is it fair to say that that should be carried over to FY 2022? Yes. Thank you. That's all. Next is Mr. Yoshikawa from Morgan Stanley MUFG Securities. Thank you. I think my question has been generally answered by your previous comments, but just for clarification. Your projection for 2022 SoC tester market is between $4.5 billion-$5 billion, with growth rate of 10% to over 20%. That's a pretty wide range. I take it that given the large order backlog, this wide range is not due to demand, but that it depends on the parts procurement level. Am I correct? Yes, we believe that will be a big factor. Plus the investment level of semiconductor manufacturers where our exposure is small, which is not yet clear. So it's a combination of those two factors. I see. So let's use this midpoint of over 15% growth. Based on what you said, your market share is expected to increase in 2022, so it could be higher, closer to 20% or even higher on a calendar year basis. Am I correct? For SoC overall, yes, that is our expectation. I see. A follow-up question. Regarding SoC, you said you have great expectation for HPC. Maybe it's an awkward question, but looking at HPC communication and other automotive applications, how would you rank them in terms of growth rate? This is Mihashi speaking. You mentioned HPC communication applications, meaning mobile and automotive and industrial equipment. Automotive and industrial equipment are small in terms of TAM, but they have highest growth rate, followed by HPC. Mobile market is still large, but in terms of growth, I think it's fair to say it's close to flat growth. I see. Thank you. What about display driver? For display driver, flat to slight increase is what we project for calendar year 2022. I see. Thank you. That's all. Next is Mr. Maekawa from Credit Suisse. Thank you. I have a question on your market share. Earlier, you mentioned as a factor major semiconductor manufacturer where your current share is low. I'm wondering if you'll be able to comment on that factor starting 2023. I say that because right now, that company is only doing APU, but most probably from next year it will start using its own modems. I believe you have a 100% market share in the conventional modem suppliers, so I'm wondering if we can expect you to win that business next year. Also, I don't know if we can call them the new customers, but I'm interested in hyperscalers, which are increasingly using their own chips. Could they be added to your customer base? What's your expectation for this year and the next? In terms of expectation, yes, we have a great expectation for hyperscalers. What will be the volume is still not clear. Regarding the start of in-house production at the company where our current exposure is low, of course, we are making marketing efforts aggressively, and similarly, our competitor, our peer, is approaching our customers aggressively. Our current exposure is limited, but we are making efforts to increase that. What are our expectations for 2023 and 2024? Since we are competing head-to-head, frankly, we wouldn't know until we actually see the results. In terms of the market share, even for SoC testers, it's currently 50%-50%, evenly split between the peer and us. I see. Thank you. Thank you for your detailed response. That's all. Next is Mr. Hanaya from SMBC Nikko Securities. Thank you. I have one question regarding your production capacity. For parts procurement, you have already explained in detail, so I understand. Now, given the market outlook and projected increase in your market share for next fiscal year, if we assume that your revenue goes up by 20% from this fiscal year's JPY 410 billion, on a quarterly basis, the sales will be over JPY 120 billion. My estimate is that perhaps JPY 120 billion level is the upper limit of your current capacity, is the upper limit of what your current capacity can handle. I'm wondering if you see the need for additional capital expenditure going forward, or would you stick to your conventional policy of not increasing fixed cost and resort to external resources? Can you comment on that? In terms of the production capacity expansion, our basic policy is to handle incremental demand for systems through external resources, outsourcing. We can respond to JPY 120 billion sales with the current capacity, with the current system, as long as we can secure part supply. We don't have any plans to drastically change our business model and switch to increasing in-house production capacity. If there are incremental demand, we will respond by enhancing external production capacity. We will respond through outsourcing. Having said that, for some of the consumables, it is more efficient to produce in-house, closer to customers. For such some consumables, there is a possibility of a capacity expansion. For the sales level of JPY 120 billion per quarter or JPY 480 billion or JPY 500 billion per year, I believe we can handle that with our current capacity. Conversely, even if they were to shrink to JPY 400 billion or JPY 350 billion, for example, we would not be affected because of this production style. I see. Very clear. Thank you. That's all. Thank you for your questions. With this, we end the Q&A session. Thank you for your participation.