Welcome to Nanya Technology's 2025 Fourth Quarter Earnings Conference Call. All lines are in the listen-only mode. The conference will be held only in English for investors around the world. Today's conference will be approximately 60 minutes. Nanya Technology's President, Dr. Pei-Ing Lee, will summarize our operations in the fourth quarter of 2025, followed by our guidance for the next quarter and key messages. Then, Nanya Technology's Executive Vice President, Dr. Chin-Su Lee, Vice President, Mr. Joseph Chou, and Financial Executive, Mr. Philip Chao, will join us as we open our Q&A session. Today's presentation materials are available for download at Nanya Technology's website at www.nanya.com. As usual, we would like to remind everyone that today's discussions may contain forward-looking statements that are subject to significant risks and uncertainties, which could cause the actual results to differ materially from those contained in the forward-looking statements. Please refer to the safe harbor notice that appears in our presentation materials, and now, I would like to turn the call over to Nanya Technology's President, Dr. Pei-Ing Lee, for the summary of operations and current quarter guidance. Dr. Lee, please begin. Ladies and gentlemen, welcome to Nanya Technology Q4 2025 Investor Conference. I'm Pei-Ing Lee. The content of my presentation to you first starts with Q4 2025 Revenue and Results, and followed by Year 2025 Revenue and Results. Then followed by CapEx Ambition, Market Outlook, and conclude by Business Review and Outlook. Our Q4 2025, the net sale $30.094 billion compared to Q3 2025, TWD 18.779 billion, Q2Q up by 60.3%. Compared to Q4 last year, TWD 6.575 billion, year-to-year up by 357%. Gross profit TWD 14.759 billion at a margin of 49% compared to Q3, TWD 3.465 billion at a margin of 18.5%. And operating income TWD 11.781 billion at 39.1% compared to Q3, TWD 1.119 billion, 86%. EBITDA at Q4, TWD 14.74 billion at 49% compared to Q3, TWD 4.731 billion at 25%. Non-operating income TWD 1.602 billion, and income-based expense $ 2.3 billion. The net income comes to $ 11.083 billion at 36.8% compared to Q3, $ 1.563 billion at 8.3%. I will explain the reason why in the next few for you. Earnings per share at $ 3.58 per share compared to $ 0.5 per share in Q3. Book value per share $ 54.99 per share compared to Q3 of $ 50.78 per share. For quarterly revenue result comparison, the revenue Q2Q up by 60.3% and year-to-year up by 357%. For, ASP point of view, Q2Q increased by 30s and year-to-year increased by 80s. Shipment-wise, our Q2Q increased by low teens and year-to-year increased by 1.5x. Exchange rate favorable mid-single digit for Q2Q and unfavorable mid-single digit for year-to-year. A little detailed comparison for Q4 2025 and Q3 2025 result. Net sales in Q4, $ 30.094 billion, versus Q3, $ 18.779 billion, up by 60.3%. The reason is ASP increased by 30s and shipment increased by low teens, and exchange rate favorable mid-single digit. Gross profit for Q4, $14.759 billion at 49% margin compared to Q3, $3.465 billion at 18.5% margin. The gross profit increased by 11.3 billion, mainly due to higher ASP and higher shipment. Operating expense at $2.979 billion compared to Q3, $2.346 billion. Operating expense increased by 0.6 billion. Operating income at Q4 comes to $11.781 billion at margin of 39.1% compared to Q3, $1.119 billion at margin of 6%. Operating income increased by $10.7 billion. Net income comes to $11.083 billion at net margin of 36.8% compared to Q3 of $1.563 billion at margin of 8.3%. The net income increased by $9.5 billion due to exchange rate favorable of 0.2 billion and income tax unfavorable of 1.8 billion. Also, operating income increased by $10.7 billion. For operating expense, SG&A comes to $855 million, and the R&D comes to $2.123 billion. And the R&D mostly is normal range, and SG&A expense marginally increased due to we had recognized employee bonus distribution. For cash flow, Q4 last year, beginning balance $52.313 billion, with cash from operating activity. From the right-hand chart, you can see that the cash from operating activity comes in $15.169 billion, minus capital expenditure of $2.24 billion, and then minus the financial activity, basically we pay out the debt repayment of the bottom note, $8.9 billion. And at the end balance comes to $57.738 billion, with free cash flow of $12.929 billion. If you pay a little bit attention to the bottom notes, you see that we have payback debt payment of $8.9 billion, and then we also have net cash by the end of the Q4. Net cash and equivalent comes to $38.5 billion. That means the cash minus the debts comes to $38.5 billion, which, compared to Q3, the net cash is around $24.2 billion. For 2025, the whole year revenue and result. For 2025, net sale comes to $66.587 billion compared to 2024, $34.132 billion. Year-to-year growth of 95.1%. Gross profit $14.984 billion at the whole year of margin 22.5% compared to 2024 of loss of $421 million. Operating income $5.243 billion at 7.9% compared to 2024 loss of $10.555 billion. Operating income $2.39 billion. Non-operating income, I'm sorry, $2.639 billion. Income tax benefit this year is the expense $1.279 billion. Net income comes to $6.603 billion at 9.9% compared to last year loss of 2024, loss of $5.083 billion. Earnings per share for 2025, $2.13 profit compared to 2024, loss of $1.64 per share. Book value for 2025, $54.99 per share compared to end of 2024, $53.27 per share. The comparison between 2025 and 2024 financial result, net sale $66.587 billion compared to 2024, $34.132 billion. Year-to-year improvement of 95.1%. The remark there is that ASP increased by 30%, and shipment increased by 50%. Exchange rate unfavorable mid-single digit. For the gross profit, $14.984 billion at margin of 22.5% compared to 2024, loss of $421 million. The gross profit increased by $15.4 billion, mainly due to higher ASP and shipment. For operating expense, $9.741 billion compared to last year is very much similar. Operating income, $5.243 billion at margin of 7.9% compared to 2024, loss of $10.555 billion. The net income comes to profit of $6.603 billion compared to 2024, loss of $5.083 billion. The net income year-to-year improved by 11.7 billion. Exchange rate unfavorable by 2.8 billion. I'm sorry, income tax unfavorable by TWD 2.8 billion, and exchange rate unfavorable by $0.9 billion. A little summary of 2025 sales and EPS by quarter. On the left-hand side of the chart, the net sales improved quarter- by- quarter very significantly. The fourth quarter result is unaudited. On the right-hand side of the chart, earnings per share, Q2Q from the first quarter and second quarter loss of total near $ 2. In the second half of the year, Q3 positive 0.5 per share, and Q4 +$ 3.58 per share. For CapEx and shipment, 2025, CapEx $ 13.4 billion, with around $6.2 billion being postponed to 2026. For 2026, we plan to target $ 50 billion capital expenditure. This is still subject to board approval. Our wafer CapEx is around 30% of this total CapEx for 2026. The rate of 70% will be used for new fab construction and facility. The shipment for 2025 shipment is up by 50% year-to-year. 2026, the shipment target to be up by teens year-to-year. For market outlook, overall market, the AI cloud server and general server continue to drive 2026 [audio distortion] demand. Supply shortage may persist for multiple demand products, such including LPDDR5, LPDDR5, DDR4, LPDDR4, or even DDR3 due to capacity constraint. Bandwidth and high-density DRAM continue to expand across cloud and edge AI application in the next few years. From the supply side, we've seen limited new supply capacity expected for 2026 and first half of 2027. We also see that supplier has been optimized their product portfolio to meet valuable value customer requirement. Demand side for server demand for high- bandwidth memory. Sorry, that's a typo there. And conventional RDIMM is increasing significantly. For PC and mobile, continue to see DRAM content increase per box. For consumer, we're seeing wide range of consumer electronic applications. Sustain solid demand. For business review and outlook, first, Q4 2025, gross margin 49%, net margin 36.8%, and EPS of $3.58 per share. For the whole year 2025, gross margin 22.5%, net margin 9.9%, and EPS $2.13 per share. Nanya has been getting 128 GB DDR5 RDIMM ready for 5600 and 6400 speed, and mono die- mid 7200 speed label. We continue to optimize our supply to DDR4 and Low Power DDR4 to consumer market. Our third generation 10 nanometer and fourth generation 10 nanometer, and also custom-made AI project are going on schedule. And our new fab equipment move-in are expected in early 2027. Also, Nanya has received ESG recognition from CDP for areas in climate change and water security. We also received recognition from TCSA for annual-based corporate sustainability reporting award, top 100 Taiwanese sustainable company, and four leadership awards. With that, now we may move to question and answer session. Yes. Thank you, Dr. Lee. Ladies and gentlemen, before we begin the Q&A session, I would like to remind everyone to limit your questions to two at a time to allow all participants an opportunity to ask questions. We'll begin taking questions from dial-ins, and for webcast participants, please message your questions with your name and company name into Nanya operator in the chat box, and now, for dial-in participants, please press star key and one on your keypad if you would like to ask questions. To cancel your questions, please press star key and two. And as a reminder, it is greatly appreciated that you turn off the speakerphone mode of your device to prevent possible echo effect. We thank you for your cooperation. Thank you. Now, for dial-in participants, please press star key and one if you would like to ask questions. Thank you. The first one to ask questions, Nicolas Gaudois from UBS. Line is open to you now. Yes. Hi, good afternoon, and thanks for taking my questions. In the current environment, do you actually see customers starting to de-spec as they may not be able to get exactly the volumes they need on the DRAM side? And if so, in which markets are currently seeing any signs of de-specing? And I got a couple of follow-ups. Thank you. Okay. D e-spec case, we do see some, but not major of the customer doing de-specing. There are some de-specing maybe in the TV section. Some of the TV users may de-spec from their use of DDR4 and LPDDR4 down to DDR3. But this is not a major quantity. This is a limited quantity. Thank you. Appreciate that color. And on your side, so you just talked about mid-teens mid-growth for full year. Going to a first quarter, I mean, what could be a reasonable range for DRAM shipments for Nanya Tech? DRAM shipment-wise, Nanya will not be Q2Q increase substantially because we are in full capacity already. And also with the depleting in inventory, likely we will not be seeing Q2Q shipment increasing substantially. However, year-to-year, we will be seeing some DRAM shipment increasing, mostly due to beginning of last year, the DRAM shipment is low. And that is makeup in this year. Okay. Great. Thank you. And last thing on my side, considering the environment we're in, I know initially the plan was to roll out new capacity with a new fab in 2027. Is there anything you can do to put in the timeline potentially as clearly you're effectively capacity constrained in the current environment? Yes. As I described, currently our new fab, the fab is almost ready. And we will be doing facilities, clean room for this year, and start to bring in equipment beginning of next year. And hopefully, by that, we can have some output by the end of first half and gradually ramping up in the second half. Great. Thank you. Now, the line is open to. I'm sorry. Maybe next question, I have a little bit of additional comment is that in the beginning, we are not targeted full fab loading. We are targeted for between 15K- 20K of first phase of capacity loading. Okay. Now, the line is open to Charlie Chan from Morgan Stanley. Hey, Pei-Ing Lee. Good afternoon. And also congratulations for very strong results. My first question is that do you plan to change your price quotation behavior? Because one of the major Korean fabs since this year, they changed to monthly quotation. I know you kind of honor all those contracts with your customers, right? But reality is that there are very strong demand, double booking, etc. So, just want to double-check, do you want to change the contract negotiation to a monthly update? As a matter of fact, no, we don't. We don't change our contract behavior. For long-term customer, we will stick with the current price quotation. As a matter of fact, with the uptrend, most of customers want to secure longer term of the negotiation. We are working with the customer case by case to see their need and what we can do for our customer. The answer is no, we don't change our behavior. The second question is double booking. That's a very good question. Under the current business environment, it's very possible that customer would like to secure more delivery so that they can secure making sure that their production will be going on well. Therefore, we have to work closely with our customer. Our sales has looked into this very closely for many years with our customer. We will be looking into customer's typical normal running rate and going from there to arrange our allocation to customer. And we want to make sure that customer do have parts to run their fab, run their business. We want to prevent customer putting their parts into our parts into the inventory, into the spec. So that is all been going around worldwide. And our sales individual has been working on that closely. Okay. Thanks, Dr. Lee. My second question is about do you see any potential supply chain disruption because of lack of DDR4 components? If that's the case, which area do you see the urgency? So we are hearing automotive, networking, even AI server, general server, PC, whatsoever, right? So lots of critical tech device needs your chip. So how are you going to make sure that wouldn't cause the supply chain disruption? And if that's the case, do you think your competitors, no matter Korean or Chinese competitor, to extend their DDR4 offering? I know some of them want to do EOL, but do you expect any extension of the offering of those DDR4? So far, we don't see supply chain disruption yet. For the critical market sector, as you mentioned, BNC, NIC, those is the sector that likely to be priority fulfill, and then you mentioned that the supplier end of life, and they may extend their residual capacity. That's well known. And actually, it's very good they do extend that to making sure that customer do have sufficient parts. So point is that for those production line has been relocated to different production, it's very difficult to move in back and forth. So the best that most of supplier can do is to continue to extend the lifetime of residual capacity. Great. So one financial question, if I may, to ask CFO Joseph. So can we get your latest depreciation schedule for 2026 and 2027? So that's why we can calculate your future gross margin trend. Thank you. Yeah. Regarding the depreciation rate, as we mentioned already, that in Q4, we are comparison in lower depreciation result. And moving on to 2026, I think we will keep the similar trend continuous this year. So that's the case as we mentioned already. Yeah. Because existing two- fab, 3A and 3B and our fab, there's quite a few equipment already depreciated and more and more will be more depreciated. So we're seeing our depreciation going to be improved gradually also. Okay. Can you quantify how much year on year in 2026 and 2027? Thank you. Yeah. In 2027, because of the new equipment moving and the new fab, so we need to recalculate in detail later on. Regarding the 2026, it's lower than 2025, maybe 10% around. Oh, okay. So 10% decline in 2026. Yeah. Okay. Great. Yeah. We will ask other questions in second round. Thank you. Ladies and gentlemen, for dial-in participants, please press star key and one if you would like to ask questions. And for webcast participants, please send your questions with your name and company name to Nanya Operator in the chat box. Thank you. Next one to ask question, Simon Woo from Bank of America. The line is open now. Okay. Great. Congratulations, Dr. Lee and Joseph. Great results, right? So the key contributor, obviously, the ASP strength for two consecutive quarters. So 40% up last quarter, I mean, the Q3, and then another 30% up this quarter. So what's the next? Any rough idea? The price trend these days, sir? Q1, Q2, or for 2026? That's a tough question. Yeah. The The reason why the price went up on Q3 and Q4 substantially, one of the key reasons is the price when it started to recover is already way, way, very low. And I mentioned that a couple of times to many gentlemen here is that because of the price downturn since 2023, actually 2022, 2022, 2023, and into 2024. And 2024, by the time of HBM, middle of 2024, by the time of HBM becoming good, HBM pricing recovered quite nicely. But the rest of the market, other than HBM, which is over 90% of the product, continued to go down, continue to go down until middle of 2025, which means that ASP-wise, for this 90% of product that we've been talking about, has been going down in pricing for almost three years. So it's at a very low point, start to climb. So you see that very significant improvement on Q3 and Q4. And on top of that is that, of course, this is all driven by demand and supply. And moving on from here, we are seeing that price in Q1 may continue to improve. As to which extent of it going to be improved, we cannot be describing that now because there are only a couple of months to go. But based on the long-term contract, we can see that the price will be upturned in Q1 as well. Likely will be some exceeding 10% at least, price uptrend. Compared to the December quarter, right? Yeah. Could be in 20% ±. Yeah. But again, it depends on two more months before we can be sure of what is the actual percentage on Q1. As you pointed out, U.S. big tech companies, they are buying HBM more annual contract basis, but not sure for the overall conventional memory. So any rough idea for your sales, what percentage for annual or multiple-year based contract versus quarterly versus monthly,or a little bit spot trading? Or any rough idea, maybe December quarter revenue mix? Well, multiple-year, the deal is very limited, very small number. And as of the market uptrend increasing, we're seeing the quarterly deal become more. And however, I cannot give you a specific number because this is very much on each case-by-case negotiation. And we still have quite a few percentages relying on month-by-month. Yeah. You are saying consumer side, the percentage of month-by-month is still higher than quarterly. So consumer more monthly, but the non-consumer still quarterly? That's still percentage-wise. Yeah. So, not yet many. The annual multiple-year contracts with auto OEMs or some industrial guys? That is, of course, is case-by-case could be treated differently. But generally speaking, year-to-year or multiple-year is limited. Yeah. Very quickly, sir, today you mentioned the new equipment moving for the new fab early 2027. That means your shell already there, infrastructure, power, water also already there, I mean, to be done through this year, the new fab? New fab, the power and water already prearranged. So if you fill out the new shell, what's the total wafer capacity there? 70K possible or just 50K? The new fab will be 45K wafer months. And our first phase is targeted for 15K-20K per month. So it must have at least one EUV layer or a few. So EUV will be there, right, for the first time? No. No. Our new fab will start to manufacture with our 1B, 1C, and 1D, our second, third, and fourth generation of the outside developed 10- nanometer process technology. That we are sure we do not need EUV. Although we are developing EUV technology as we speak using current generation to do the work, and we have proven that we can do it, and the matter is that when it's suitable for us to bring equipment to produce. Also the question from some investors, they are asking to Joseph, CFO, whether you are considering dividend payment with a very good second half result, and then another investor question is whether you can break down your revenue, DDR3 versus DDR4, and a little bit DDR5. Thank you, sir. Appreciate. Okay. Very good. Okay. Regarding the product ratio, right now we are more focused on the DDR4 and the low-power DDR4 is the major. But the DDR5, we will keep the running ratio is around 10% or a little bit higher. And the remaining will be the DDR3 as well. So that's the product mix. And regarding the dividend payout ratios, our guidance is like 50% around. But we will depend on our shareholders' voting, and we will propose to the board meeting and get a final approval. Yeah. So you mean 50, 50% of the maybe? 45%-55% is our guidance, general guidance. Even for the 2025 results? That we're still trying to figure it out. Okay. Could be a little more on the upside or we are still discussing on that. Okay. But important, point in the assignment is that as we're going to be building new fab, we're going to be spending a lot of money in the construction as well as the equipment for the future. Okay. Likely we will be preserving some cash next year. But this year could be a little bit more favorable for distribution. Yeah. The market is already getting bigger, so investors should be happy. But I'm joking. But very quickly, Dr. Lee, so you are saying DDR5 portion is only 10% or a little bit higher in Q4 sales, DDR5. 10%. But the DDR3 maybe around 40%? 20? 20? 20, yeah. Yeah. So the rest around near 70% is LP DDR5 or regular DDR5 altogether, right? DDR4 and low-power DDR4. Oh, sorry, sorry. So DDR3 20%, DDR4 should be what percentage? DDR4 only? DDR4 plus low-power DDR4 around 70%. Okay. 70%. Okay. Makes sense. So 10% for DDR5, DDR3 20%, the rest 70% should be the DDR4. So overall, it's a revenue basis, right? That's including DDR4 and low-power DDR4. Yeah. That's a revenue basis, right? Well, that's a shipment base. Oh, shipment basis? Yeah. That's shipment basis. But DDR3 price premium very high, so DDR3 revenue portion should be much higher than this then. Yeah. DDR5 is a strategic product and technology that we have to move along, prepare for the future. Okay. So we like to grow DDR5 if the market is favorable. Okay. And DDR3 is more of the residual legacy consumer supply. Yeah. All clear, sir. Thank you very much, Dr. Lee and Joseph. Appreciate. Thank you. Thank you. Next one to ask questions, Jay Kwong from JP Morgan. Line is open now. Thank you, Dr. Lee, for having the opportunity to ask a question. I just like to ask, building upon the previous question about the DDR5 mix you said it's around 10%. And I believe the pricing for probably DDR4 on average is currently higher than that of a DDR5. Does it mean with also your stronger DDR4, probably customers' mix will be largely unchanged around 2026? Or do you have any specific target by year 2026 that you are targeting? That's my first question. And also second question, it's been a while since the DDR4 pricing momentum has been stronger than that of a DDR5. By when do you expect the DDR4 pricing to increase momentum to be still stronger than that of a DDR5? Any guesstimate or any range of a probably price increase between the two for the first quarter, as you pointed out, it will be roughly 20% ± range. Thank you. Your question is comparing between DDR4 and DDR5 in ASP, and we've seen that DDR5 pricing also improved quite substantially for the past few months. Okay, and as I indicated, DDR5 is our strategic product and process development that we will continue to pay attention to, and we like to grow DDR5 if market is favorable. Okay, and on top of that is for DDR4, we continue to support our customer and at the best that we can do. Okay, and if anything possible is that we can reduce the DDR3 if the market size shrink to a certain degree. Okay, so overall speaking, we've seen that the market is tight on all market. Okay. DDR5, DDR4, low-power DDR4, and so with DDR3 for now. Okay, and the pricing will be very much depend on individual demand and supply sector product portfolio, basic product mix. Okay. Our strategy is to continue to support our customer. Even though the margin may be varied from one side to the other side somehow, but strategically, our goal is to make profit, but as well as making sure that our key customer requirement is fulfilled. If I may, just one follow-up question, then would you be able to share the key considerations of the product mix strategy between the DDR4, LP DDR4, and DDR5? Can we safely assume the mix will be largely unchanged throughout 2026? Or do you still put DDR5 as a strategic product to increase the shipment mix? As I say that we like to maintain at least 10% or more. If there's a chance to grow DDR5, we will grow DDR5. And, hopefully, it's at the expense of DDR3 instead of DDR4. Clear. Thank you. Next one to ask a question, Charlie Chan from Morgan Stanley. Line is open now. Thanks for taking my follow-up question. So definitely you mentioned about you will grow DDR5 mix if the market is favorable. Right? So I guess the two-part question. So first of all is when do you think this DDR4 upcycle will peak? And secondly, want to get your opinion about the DDR5 supplier, especially Micron seems to sign a contract to convert Powerchip's fab to the future DRAM production, likely DDR5. Right? So, what do you think about the DDR4 and DDR5 cycle in the coming two years? Yeah. I think your question about the news on Micron and Powerchip deal. And I think that's quite normal. Okay. And historically in DRAM industry, there's always partnership, always consolidation as well. Okay. So that in the upmarket, looking for partnership, developing new business opportunity, that's quite normal. And one topic is that requires some time to build a new facility, new equipment, new capacity that requires some time. And also the initial cost for that is pretty high. So that's a factor. If we factor that in, DDR4 or DDR5 supply may not be substantially changed. For next at least one and a half or even two years. Thanks. Yeah. So my next question is a little bit harsh because I feel like you honor all those comments. If it's harsh, I will- excuse me. Let me try to be more modest. But anyway, because I feel like your industry peers, they try to monetize or maximize their profits as much as they can. Because during the down cycle, customers are like, "I don't want to save you." Right? It's your own industry problem. So this is one out of five years or even ten years, right? They can finally receive back all the investments. But based on your answer to your questions beforehand, you don't want to change the price negotiation behavior. So do you think you kind of underestimate your kind of pricing power? So your earning power may not be as great as other DRAM players in this super cycle? I think to be fair, Charlie, is that for the last 13 years, Nanya has made profits for 11. Okay. We lost money on 2023 and 2024. Okay. And you go back, you find that the major supplier also suffered a lot on 2023 as well. Okay. So overall speaking, that Nanya is doing okay. Even though we suffered quite a bit in 2024 when the market recovered with HBM and DDR5. Okay, and we are behind on that. Okay, so to be fair, I think that we need to improve ourselves instead of complain on the market or on the demand and supply. Okay. And from a profit point of view, of course, we are looking for profit for sure. Okay. By saying that we want to meet customer requirement also, that's important because customer is the one who will buy our product, and that's the opportunity for us to do business and working together to gain profit. Customer gain profit, we gain profit as well. Okay. So I don't think your question is too harsh, so I answered direct without asking Joseph to answer. Okay. That's great, so just some feedback, right? I think industry average price hike could be 50%-60% in 1 Q based on what your industry peers' quotation so I wanted to clarify. When you said that 20% price hike, they refer to fourth quarter, not 1 Q, right? 1 Q, you haven't really come out with the price hike magnitude, right? There are so many product portfolios. Okay. So I saw some of your report, actually, you cannot take one product number and make it across the board. Okay. For instance, we're doing DDR5. We're also doing DDR3. And for customer need, we're doing some low-power DDR4. Some is very profitable. Some is not as profitable as well. Okay. So for generality, if you take one number and bring it across the board, your number will be far exceeding the reality that we may be able to deliver. Okay. I just like to remind you when you're doing a model, you need to take into account all the product portfolio. Okay. That's fair. So again, to clarify, the 20% you were referring to last quarter, not the current quarter, right? The 20% ± that I'm referring to Q1 this year. Okay. And maybe that will be a slightly plus or minus situation. I would say mostly will be more than 20 plus instead of 20 minus, most possibility. Yeah. Okay. Sure. Yeah. So I think your pricing strategy will continue into Q2, right? I mean. Yeah. As I described, we will keep our pricing strategy. We don't want too much of opportunities. We need to work with our customer on their need. Okay. Okay. I respect. And thanks for your guidance about how we should do the real assumption for ASP. And lastly, as we ask every quarter about your wafer-on-wafer, there's an AI opportunity. Can you provide more details? Oh, yeah. That's a very good question. As I described that our 3rd generation, 4th generation development on the process and product is going on schedule. So it's our customer-make AI projects. That's going on well. And actually, it's a little bit ahead of our schedule. Originally, I expect that second half this year, we may be generating revenue. Likely, we will be generating revenue first half this year. So again, it's both cloud and edge AI? Yes. Cloud and edge AI. Depends on customer's application. And for that, it's customer confidentiality. And I cannot comment more. Okay. So let me try. And if you don't feel comfortable to comment, then we can skip. Yeah. Because smartphone and also HBM are very important future edge AI markets. Which one or both you think you will have a potential opportunity? I would say both cloud, phone, and also even smart notebook, smart PC. They will gradually increase their AI environment. Okay. And in the longer future, you will start to see that AI moving to automotive, okay, as well as robotic, all will have wonderful AI application. Okay. Sounds great. Thanks, Dr. Lee. Thanks, Joseph. Thank you, Charlie. Thank you. Next one to ask question, Nicolas Gaudois. Go ahead, please. Yeah. Thanks for taking your follow-up. Could you confirm to us when you'll be starting mass production for 1C nanometer? And I think you answered to starting piloting on 1D nanometer in the first half of this year. Is that still the case? Thank you. 1C, we're targeting by the end of this year, we should be able to start our qualification. We are targeted for the end of this year. And how about 1D for piloting? 1B, we are already in full production. 1D, maybe- 1D, maybe one year beyond For qualification. Yes. Okay. Thank you very much. Online question. Okay. And the next one to ask question, Jay Kwong, JP Morgan. Line is open now. Thank you. Just one last quick question, if you don't mind. Nanya has talked about the 16 Gb DDR4 monolithic die with a very long life cycle for a while from consumer side. Are you still seeing the trends continuing, or is there any trends of a customer migrating to DDR5 or given probably the very tight market, customers have no preference in trying to still secure as many DDR4 as possible? Thank you. Yes. Our customer planned to move from 16 Gb DDR4 to DDR5. But also, Loyal customer decided to stay in DDR4. And that's also true for low power. Okay. So we're seeing that the demand for 16 Gb DDR4 and 16 Gb low-power DDR4 are pretty strong. And Nanya is preparing to do some sampling toward the end of this first half of this year. Thank you. Okay. So now can we move into online question? We have the online question from KGI Securities, Michael Shen. He has two questions. His first question is, we have observed a meaningful improvement of variable cost per bit in Q4 compared to previous quarter. And he would like to ask what is the reason. And basically, our cost has been coming down Q4 versus Q3 in depreciation. Q2Q depreciation-wise is coming down by almost 20%. And moving on, as Joseph just described, moving on from now, maybe 10%. Okay. So depreciation is a key and also product mix and also other minor cost reduction as well. And second question is regarding to the news about Micron transferring process technology to one of the DRAM peers. Then do you believe this could have impact on the supply-demand dynamics of DDR4 and low-power DDR4? Now, if so, at what point in time might such effect begin? And additionally, given that the competitor has sold its fab but may receive Micron's process technology, how do you view potential implications of competitive landscape or wafer-on-wafer going forward? I guess it's not suitable for me to comment too much on the competitor or the previous partner, their business actions. However, I could share from our own experience. As I described just now, historically, in the DRAM industry, there are many cycles of partnership as well as consolidation back and forth. Okay. And Nanya do have experience working with a few partners, including IBM, including Infineon, including Qimonda, and including Micron. Okay. And personally, I have been deeply involved with all these projects. Okay. And all these projects from Nanya's side, we do see that it's going to take time. It's going to take cost, take money to build the capability. Okay. And likely, because of that, we're seeing that the impact may be one and a half to two years from now. Okay. And then we have the next question from Capital Securities by Diane Chen. Okay. And the question is, what is the current year of roadmap status of the 1B process? And what is the target procurement contribution for 2026? Okay. And 1B is already in full production. Okay. And yield is already pretty reasonable at a pretty high range. Okay. And our target procurement will be around 40% of output shipment. We're looking for that percentage. With the industry-wide shift of capacity toward HBM, how is Nanya capitalized on the resulting supply shortage on DDR4 market? To answer your question on Q4. First, we're not totally shifting to HBM. We are working with our customer on what we call custom-made AI project. That's going on well. Second, Nanya has been optimizing our capacity and delivery to DDR4 as well as low-power DDR4 market, as we just described in the past few minutes. And your question three is, what is the projected revenue mix for DDR5 by the end of 2025? How will this impact the overall blended average selling price? I also commented that in my previous answer to the question is that DDR5 is Nanya's strategic product line that we will continue to support and develop. If we see opportunity to increase our contribution to DDR5 market, we will do so. Okay. And overall speaking, we are looking for at least 10% or more. And yes, it may be impacting somehow, okay, on DDR overall ASP. Okay. However, DDR5 pricing also improves substantially over the past few months. And your question four is regarding to customer-made HBM strategy. What is the status of collaboration with the ecosystem partner for edge AI and automotive application? Our partner decides their application. Either it's going to be in the cloud or in edge, in PC or mobile phone, or any other automotive. Okay. Our customer decides that. Okay. And so far, that has been going on well, as I say. It's ahead of my previous expectation. Originally, I was expecting that second half, this year may start to generate some revenue. It looks like it's ahead of schedule. We will be generating revenue in the first half this year. Your question five, well, long list. What is the 2026 CapEx for new fab equipment moving? 2026 CapEx, as I described, will be 30% out of our total CapEx of TWD 50 billion targeted. And your question six, given the return to profitability, what is the full current stance on 2026 dividend policy? If you're talking about earnings from 2025, okay, likely will be a little different from earnings from 2026. And for 2025, first of all, our general guidance is between 45%-55% of our earnings. Okay. And but that's the general guidance. For 2025, we may be looking for a higher percentage. For 2026 earnings, we're looking for a lower percentage to preserve cash for our future CapEx requirement for new fab. The next question is from Yuanta Securities by Michael Hsu. You have four questions. Okay. Let me quickly answer one by one. At DDR4, 16 Gb started ship to client? No. We target to ship toward the end of the first half. Any update on mass production schedule about wafer-on-wafer? Yes. We have moved in the equipment, and we have done early engineering setup. And that is going on schedule very well. Your question three, have companies signed LTA? If so, what percentage of capacity booking for LTA? Yes, we signed LTA. However, I cannot give you the precise percentage of LTA. Okay. And this we'll discuss case by case as needed. Question four is financing plan for 2026 and 2027. Looks like launching debt or new shares. Both are possible. First of all, looking into our current net cash situation is that by the end of 2025, we had net cash of around $1 billion, more than $1 billion US dollars. And we are looking for by the end of this year, 2026, we will be generating another $2 billion from Nanya's net cash point of view. So likely, we will have around $3 billion of net cash by the end of this year. So with that, we have at least a large percentage of what we need for building a new fab first phase. However, we will continue to consider debts and new shares. Okay. And that will be arranged in the future. Okay. With that, end of all questions. Thank you so much for your questions and comments. Yes. Thank you, Dr. Lee. Thank you, ladies and gentlemen. That concludes our conference call today. Please be advised that the replay of the conference will be accessible within three hours from now, which will be available through Nanya Technology's website at www.nanya.com. We hope you would join us again next quarter. Thank you for your participation and have a wonderful day. You may disconnect now. Thank you and goodbye. Thank you. Thank you for your support.