Good afternoon, and welcome to Diodes Incorporated's Q4 and fiscal 2023 financial results conference call. At this time, all participants are in a listen-only mode. At the conclusion of today's conference call, instructions will be given for the question-and-answer session. If anyone needs assistance at any time during the conference call, please press the star key followed by zero on your touchtone phone. As a reminder, this conference call is being recorded today, Tuesday, February 6, 2024. I would now like to turn the call over to Leanne Sievers of Shelton Group Investor Relations. Leanne, please go ahead. Good afternoon, and welcome to Diodes' fourth quarter and fiscal 2023 financial results conference call. I'm Leanne Sievers, President of Shelton Group, Diodes' investor relations firm. Joining us today are Diodes President, Gary Yu, Chief Financial Officer, Brett Whitmire, Senior Vice President of Worldwide Sales and Marketing, Emily Yang, and Director of Investor Relations, Gurmeet Dhaliwal. I'd like to remind our listeners that the results announced today are preliminary, as they are subject to the company finalizing its closing procedures and customary quarterly reviews by the company's independent registered public accounting firm. As such, these results are unaudited and subject to revision until the company files its Form 10-K for its fiscal year ending December 31, 2023. In addition, management's prepared remarks contain forward-looking statements, which are subject to risks and uncertainties, and management may make additional forward-looking statements in response to your questions. Therefore, the company claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from those discussed today, and therefore, we refer you to a more detailed discussion of the risks and uncertainties in the company's filings with the Securities and Exchange Commission, including Forms 10-K and 10-Q. In addition, any projections as to the company's future performance represent management's estimates as of today, February 6, 2024. Diodes assumes no obligation to update these projections in the future, as market conditions may or may not change, except to the extent required by applicable law. Additionally, the company's press release and management statements during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms. Included in the company's press release are definitions and reconciliations of GAAP to non-GAAP items, which provide additional details. Also, throughout the company's press release and management statements during the conference call, we refer to the net income attributable to common stockholders as GAAP net income. For those of you unable to listen to the entire call at this time, a recording will be available via webcast for 90 days in the investor relations section of Diodes' website at www.diodes.com. And now I'll turn the call over to Diodes President, Gary Yu. Gary, please go ahead. Thank you, Leanne. Welcome, everyone, to our results conference call. I'm pleased to be joining you today as Diodes' recently appointed President, effective January 2. As announced at the end of last year, my promotion was part of Diodes' multi-year CEO succession plan. Dr. Lu will continue to serve as Chairman and CEO until at least May 31, 2027, which is consistent with current employment agreement. As many of you may know, I have previously served as Diodes' Chief Operating Officer and have been with Diodes since 2008. I'm very excited to be serving in this new role and leading Diodes into the next stage of growth, which will focus on developing a broad portfolio of innovative products to enable customer success in the market we serve. In terms of our 2023 results, this past year proved to be challenging as the consumer, computing, and the communications market experienced an extended slowdown, coupled with inventory rebalancing in the industrial markets late in the year, as well as softness in certain areas of automotive market. Despite this global weakness, we make notable progress on improving the quality and a mix of product portfolio. We continue to focus on automotive and the industrial market through expanding design wins and increased investment in new product development, which result in over 350 new automotive-compliant products. The combined revenue from those two markets expanded to 46% of product revenue in 2023, compared to 42% last year. Our product mix improvements were especially evident in our ability to maintain full-year growth margin near 40%, meeting our target model despite the lower annual revenue. Throughout the year, we continued to drive manufacturing cost reductions, operating efficiency, while also further developing our process technology for expansion of our internal facility utilization. Overall, we maintained strong cash generation in 2023 that enabled us to reduce total debt by $124 million to $62 million, maintain a solid cash position over $350 million, and increase total cash less debt by 67% to approximately $253 million. Additionally, we renewed, expanded our line of credit to approximately $350 million to provide added financial flexibility. As we look to 2024, we remain focused on driving further improvements in the quality and the mix of our portfolio with our analog and our power discrete products, including our newly introduced SiC product family, especially targeted at the automotive and industrial markets.... We also continue to make a good progress, ramping our previous acquired fab, FC fab, and a G fab, in terms of process and the product qualifications, which will support future utilization and further complement our hybrid manufacturing model. We believe our total solution sales approach that has been successful in the past, along with a further emphasis placed on key account development, will continue to deliver increasing content opportunities, design wins, and a profitable growth in the future. With that, let me now turn the call over to Brett to discuss our Q4 and the full year financial results, as well as our Q1 guidance in more detail. Thanks, Gary, and good afternoon, everyone. Revenue for the Q4 of 2023 was $322.7 million, compared to $404.6 million in the Q3 of 2023, and $496.2 million in the Q4 2022. Full year 2023 revenue was $1.7 billion, compared to $2 billion in 2022. Gross profit for the fourth quarter was $112.5 million, or 34.9% of revenue, which reflects the lower revenue impacted by product mix, as well as our wafer service agreements. This compares to $155.9 million, or 38.5% of revenue, in the prior quarter, and $206.2 million, or 41.6% of revenue, in the prior year quarter. For the full year, GAAP gross profit was $658.2 million, and GAAP gross margin was 39.6%, effectively at our target model of 40%. GAAP operating expenses for the Q4 were $91.8 million, or 28.4% of revenue, and on a non-GAAP basis, were $89 million, or 27.6% of revenue, which excludes $3.8 million of amortization of acquisition-related intangible asset expenses, and $1 million in a restructuring cost gain. This compares to GAAP operating expenses in the prior quarter of $102 million, or 25.2% of revenue, and in the fourth quarter of 2022, of $109.7 million, or 22.1% of revenue. Non-GAAP operating expenses in the prior quarter were $95.6 million, or 23.7% of revenue. Total other income amounted to approximately $7.2 million for the quarter, consisting of $4.8 million of interest income, $3.5 million of other income, $1.8 million unrealized gain on investments, a $2.5 million foreign currency loss, and $0.5 million in interest expense. Income before taxes and non-controlling interest in the Q4 2023 was $27.9 million, compared to $60.5 million in the previous quarter, and $94.8 million in the prior year quarter. Turning to income taxes, our effective income tax rate for the Q4 was approximately 9.9%. For the full year 2023, the tax rate was approximately 17%, which was within our expected range. GAAP net income for the Q4 was $25.3 million, or $0.55 per diluted share, compared to $48.7 million, or $1.05 per diluted share last quarter, and $92.1 million, or $2 per diluted share, in the prior year quarter. Full year GAAP net income was $227.2 million, or $4.91 per diluted share, compared to $331.3 million, or $7.20 per diluted share in 2022. The share count used to compute GAAP diluted EPS was 46.3 million shares for both the Q4 2023 and the full year. Non-GAAP adjusted net income in the Q4 was $23.4 million, or $0.51 per diluted share, which excluded net of tax, $3.1 million of acquisition-related intangible asset costs, $2.8 million gain on investments, $1.4 million non-cash mark-to-market investment value adjustment, and a $0.7 million dollar gain on restructuring costs. This compares to $52.5 million, or $1.13 per diluted share in the prior quarter, and $79.6 million, or $1.73 per diluted share in the Q4 2022. For the full year, non-GAAP adjusted net income was $222.8 million, or $4.81 per diluted share, as compared to $339 million, or $7.36 per diluted share in 2022. Excluding non-cash share-based compensation expense of $5.9 million net of tax for the Q4, and $24.4 million for the full year, both GAAP earnings per share and non-GAAP adjusted EPS would have increased by $0.13 and $0.53 per diluted share, respectively.... EBITDA for the fourth quarter was $58.4 million, or 18.1% of revenue, compared to $90.6 million, or 22.4% of revenue in the prior quarter, and $129.6 million or 26.1% of revenue in the Q4, 2022. For the full year, EBITDA was $404.2 million or 24.3% of revenue, compared to $520.4 million or 26% of revenue for 2022. We have included in our earnings release a reconciliation of GAAP net income to non-GAAP adjusted net income and GAAP net income to EBITDA, which provides additional details. Cash flow generated from operations was $38.4 million for the fourth quarter and $280.9 million for the full year. Free cash flow was $11.1 million in the Q4, which included $27.3 million for capital expenditures, and for the full year, free cash flow was $130.1 million, including $150.8 million for CapEx. Net cash flow was +$20.9 million, and for the full year, net cash flow was -$22.6 million, which includes the net paydown of $124.3 million of total debt. Turning to the balance sheet, at the end of fourth quarter, cash, cash equivalents, restricted cash, plus short-term investments totaled approximately $329 million. Working capital was $794 million, and total debt, including long-term and short-term, was $62 million. In terms of inventory, at the end of Q4, total inventory days were approximately 160, as compared to 124 last quarter. Finished goods inventory days were 49, compared to 34 last quarter. Total inventory dollars increased $46.1 million from the prior quarter to $389.8 million. We increased inventory during the quarter in order to support short lead time orders and also prepare for the lower output expected in the first quarter due to Chinese New Year holiday. Total inventory in the quarter consisted of a $34.6 million increase in finished goods, an $8.1 million increase in work in process, and a $3.4 million increase in raw materials. Capital expenditures on a cash basis were $27.3 million for the Q4, or 8.5% of revenue, and $150.8 million, or 9.1% of revenue for the full year, and within our target range of 5%-9%, as we continue to invest in the future growth and expansion of our business. Now, turning to our outlook. For the first quarter of 2024, we expect revenue to be approximately $305 million, ±3%. We expect GAAP gross margin to be 34%, ±1%. Non-GAAP operating expenses, which are GAAP operating expenses, adjusted for amortization of acquisition-related intangible assets, are expected to be approximately 28.7% of revenue, ±1%. We expect net interest income to be approximately $2 million. Our income tax rate is expected to be 18%, ±3%, and shares used to calculate EPS for the first quarter are anticipated to be approximately 46.5 million. Not included in these non-GAAP estimates is amortization of $3.1 million after tax for previous acquisitions. With that said, I will now turn the call over to Emily Yang. Thank you, Brett, and good afternoon. Revenue in the Q4 was down 20% sequentially and slightly below the midpoint of our guidance. Our global POS decreased in the quarter, and our DC inventory increased slightly, remaining above our defined normal range of 11-14 weeks. Looking at global sales in the fourth quarter, Asia represented 78% of revenue, Europe 14%, and North America 8%. For the full year of 2023, Asia represented 71% of revenue, Europe 17%, and North America 12%. In terms of our end markets, industrial was 23% of Diodes' fourth quarter product revenue, automotive 18%, computing 25%, consumer 19%, and communication 15% of product revenue. Our automotive and industrial end markets combined total 41% of the Q4 product revenue, representing the seventh consecutive quarter above our target model of 40%. For the full year, industrial was 27%, auto 19%, computing 23%, consumer 18%, and communication 13%. Auto and industrial revenue in 2023 reached a record 46% of product revenue, compared to 42% last year. Now let me review the end markets in greater detail. Starting with the automotive market. In the Q4, automotive was 18% of our total product revenue, which is a slight decrease from the last quarter, 19%. We began seeing some slowdown, along with inventory rebalancing in Q4, and believe this will continue into the Q1. For the full year, revenue reached a record 19% of product revenue compared to 15% last year, which represented a 28% compounded annual growth rate from our initial launch into the auto market in 2013, which was only about 3% revenue at that time. Over this time period, our content per car increased from $28 in 2013 to over $160 in 2024, and Diodes' focus will continue to be on the content expansion going forward. In 2023, we introduced more than 350 new automotive compliance products, demonstrating our commitment to this market segment. New products continue to drive the expansion of our design pipeline and total available market, while also improving our product mix. Even though we still see pockets of softness in the automotive market, design momentum has remained very strong for Diodes. During the Q4, our TVS diodes and ideal diodes controllers continued to gain traction, while our LDOs got designed into applications for ADAS, smart cabin, telematics, and infotainment. The adoption of our USB Type-C redrivers, DisplayPort active crossbar MUX, and MIPI switches has increased significantly in the rear seat entertainment, smart cockpit, ADAS, and active cable design for automotive applications. We also achieved several design wins for our crystal oscillators and PCI Express clock generator for the development of new ADAS design. Our newly updated USB power delivery controller portfolio that supports extended power range is gaining traction from in-vehicle infotainment system and USB Type-C charging functions. Our SBR products are also seeing momentum in battery management system, display, lighting, and headlight systems. Also, during the quarter, we saw positive design momentum for our newly released N-channel MOSFET, specifically targeting the growing demand for silicon carbide solutions in the electric and hybrid electric vehicle automotive subsystems. These MOSFETs are tailored for applications such as battery charger, onboard chargers, high-efficiency DC-DC converters, motor drivers, and traction inverters. Additionally, our SBR and Schottky product shipments have ramped up significantly for EV applications. In the industrial market, Q4 revenue represented 23% of total product revenue, which was a three percentage point decrease sequentially due to the weaker demand and inventory rebalancing we mentioned last quarter. Since our last call, we have seen this market witness broaden. For the full year of 2023, industrial represented 27% of product revenue. Even despite the market softness, our design pipeline remained very strong throughout the year, and we continue to see new application opportunities as our content has expanded. In terms of progress on the product initiatives, our PCI Express 3 package switches are winning designs across diverse applications, including artificial intelligence of things, automation inspection, power plant controllers, test instrument applications. These package switches enable SoC to connect to various endpoint devices such as wired, wireless network, SSD storage, and specific industrial controllers over the industrial standard PCI Express bus. We secure new design wins for a range of essential components like HDMI, USB Type-C, DisplayPort, MIPI redrivers, and MUX switches in commercial displays, drones, and robotic applications. One area of strength in the industrial market has been solar, where our SBR product has gained traction in residential roof solar panels, along with our real-time clock being used in solar systems and our TVS product being designed in for data line protection in battery management system for solar energy storage battery cells. Additionally, our silicon carbide MOSFET has been gaining traction in industrial motor drivers, solar inverters, data centers, and telecom power supplies. Turning to computing markets, Q4 revenue represented 25% of product revenue, which is flat to last quarter. Full year revenue represented 23% of total product revenue, compared to 24% last year. After a few quarters of inventory adjustment, we are seeing customer inventory levels returning back to normal levels. Due to the impact of Chinese New Year holiday on the Q1 revenue, we expect to see some recovery beginning in the Q2 and progressing in the second half of the year. In terms of design wins and secure new designs and ramp production for our SBR and Schottky diodes in notebook adapters and power applications, server, as well as notebook motherboards. Protection devices for high-speed data line are being designed into Chromebook to protect the Type-C port, and our TVS products are being used to protect the power sourcing line of the solid-state drive modules for data center servers. We have also gaining momentum for signal integrity and connectivity products for various protocol in computing applications, including workstation, gaming, notebook, desktop, docking stations, and app in cars. We also secure new design wins for PCI Express clock buffers, crystal oscillators, and silicon carbide Schottky diodes in servers, machine learning, and for various power factor correction applications in servers. In the communication market, Q4 revenue was 15% of product revenue, which is an increase from 12% in the Q3. Revenue for the full year represented 13% of product revenue, compared to 15% last year. After a few quarters of inventory adjustment in the smartphone specifically, we are seeing customer inventory level returning back to a normalization level. In the telecom and networking market, inventory rebalancing continues. In terms of design wins in the quarter, our timing products, including clock buffers and crystal oscillators, are seeing new wins for smart NIC and the connectivity products like MIPI switches and our TVS protection products are seeing adoptions in smartphone applications. Lastly, in the consumer market, Q4 revenue represented 19%, which is a one percentage point increase compared to last quarter. Similar to the inventory situation in computing market and also in smartphones, after a few quarters of rebalancing, customer inventory is now mostly clean. Following the Chinese New Year holiday and the typical seasonality for consumer in the Q1, we expect to see some recovery late in the Q and into the second half of the year. For the full year, revenue in consumer market represented 18% of product revenue, compared to 19% last year. During the quarter, we have seen strong adoption of our USB Type-C display, active crossbar mux, USB Type-C display redrivers and retimers, PCI Express clock generators, real-time clock, and signal conditioners in various applications like tablets, docking stations, USB Type-C active cables, cable extenders, cameras, televisions, and monitors. We also secure design wins for our MOSFET and MIPI switches and redrivers in gaming and VR, AR applications. In summary, although the 3C market has been slower to recover and overall global demand remains soft, we are encouraged by the continuous progress we have made over the past year in the automotive and industrial market. Our team remains focused on driving new product introductions, product mix improvements, design win momentums, as well as a focus on key account development. Diodes' strong cash generation has enabled us to maintain investments in support of the future growth and expansion of our business that positions us well as the global market improves throughout the coming year. With that, we now open the floor to questions. Operator? Thank you. If you would like to ask a question, please press star then one on your telephone keypad. If your question has already been addressed and you'd like to withdraw your question, please press star then two. Today's first question comes from Matt Ramsey with TD Cowen. Please go ahead. Thank you very much, guys. Good evening. It's obviously been an interesting period here as the inventory and the industry have corrected. What I wanted to start the conversation with is maybe to give a little bit more detail on where you think your sell-in for the March quarter guidance is across the different segments relative to the sell-through, and how much inventory we might still need to burn down. If you could give any color by segment, that would be helpful, and just where you think you are in terms of getting to that sell-in, sell-through balance, so we can start to have revenue reaccelerate out the back end. Thank you. Hi, Matt, this is Emily. Let me address your question. So I think from the market segment point of view, right? Like I mentioned earlier, start with automotive. What we are seeing is the inventory rebalancing kind of started in Q4, and it will continue into the Q1. And then from the industrial market segment, we experienced weaker demand in Q4, plus inventory rebalancing. Unfortunately, we've seen the weakness broaden. And from the computing point of view, customer inventory is pretty clean. I think the only concern or estimate that need to keep in mind is the Chinese New Year. You know, so this is definitely going to impact some of the production as well as the output. We do expect the recovery in the Q2 and progressing into the second half of the year. From communication point of view, I talk about smartphones. Customer inventory is pretty much normalized, but for the typical telecom, networking, or the enterprise point of view, we see the inventory rebalancing will continue. So I think from the consumer market segment, because it's pretty wide range of applications. But I think in general, what we see in customer inventory is relatively clean. We do expect, you know, more ramp up in the late Q2 based on usual consumer seasonality, you know, cycles, right? So that's really what we see overall by each of the market segments and the inventory situation. So, Emily, thank you for that. I really appreciate it. I guess, as my follow-up question, and this maybe will be across the different business segments, I wanted to ask about the pricing environment. So, and maybe from two angles. First of all, we do hear a lot about some of your larger peer competitors maybe getting more price aggressive in certain end markets. So that's one element to it. And then, secondly, I wanted to kinda compare, you guys guided to a bit above $300 million for the March quarter. And if you compare that to, say, three or four years ago, when you were at similar revenue level, maybe what the pricing has done over that period of time. Do you see pricing obviously increased post the pandemic when the supply was all tight? Is it coming back down rapidly? Any commentary that you have on the pricing trends would be really helpful. Thanks. Yeah. So I think, you know, usually pricing's always a balance between demand and supply, right? So when you see a weaker demand market, usually you definitely get more of the price pressure. This also varies by, you know, the type of product, right? If it's more differentiated, you usually get a little bit less price pressure versus very deep commodity, which is really that you have a lot of competitors within the same arena, right? So what we've been saying all along is we focus on product mix improvement, which really means strategically walking away from some of the key commodity area, right? So, so in general, that will continue to be our focus, and we believe with this, you know, execution of the product mix initiative continue to improve, that will help overall Diodes, not only from the margin point of view, but also from the revenue point of view. I think the second part of your question is, we guided around $300-some range, and, if I just look back, to the historic numbers, let me see. I, I would say probably back to, you know, 2000, year 2000, so that's a pre-COVID timeframe. That's also before the Lite-On Semiconductor acquisition. You know, I just look at, for example, the 3Q 2020, and that is about $310 million quarterly revenue, and our margin is around 35.9%. Keep in mind that that's actually before the Lite-On Semiconductor acquisition, and that pretty much gave us about 3% margin degradation. So that will be representing about 32% margin. The other difference is actually also from the underloading capacity point of view. It's quite significantly different from what we have right now versus before. So I think that's pretty much the reference point, right? So if you look at the overall margin, I think majority of the pressure is actually coming from the underloading, and that's also the area that we are driving very aggressively, you know, backfill some of the capacities, improve the utilization, in the near future, right? So I, I would say that's really the second part of your question. I hope I answered it. No, no, thank you, Emily. I really do appreciate that. I'll jump back in the queue. Thanks. Thank you. Our next question today comes from Gary Mobley with Wells Fargo Securities. Please go ahead. Hey, everyone. Good afternoon. Thanks for taking my question. And, Emily, thanks for the detailed response to Matt's question, and that's where I want to pick up and start. So you covered the pricing dynamics, the underutilization, but let me ask a question on gross margin in a different way. Given that Q1 should represent, you know, seasonal low point, at least in the near term, would you expect the Q1 gross margin to be the bottom for a year? And maybe more pointedly, do you expect. What do you expect for gross margin for the full year? And within that, how much of a headwind does the wafer service agreements represent? Yes, Gary. So let me answer the first portion of the question, and then I'll let Brad or Gary answer the manufacturing service agreement, right? So, you know, definitely, Q1 with our guidance, you know, our revenue, you know, decreased about 5.5%, matching pretty much our seasonality, right? The market is still extremely dynamic and, you know, definitely we're not ready to guide the Q2. But based on the usual seasonality, usually Q2 will be a growth quarter and then the Q3. Because lack of, I would say, overall, visibility, what we truly believe, the second half is definitely going to be stronger than the first half, right? I think we just need to continue to monitor the overall market. As we grow from the revenue point of view, as we also have time to really qualify and porting additional products into our internal, fab, the utilization will continue to improve, right? So you know, it's difficult for us to forecast the whole year. That's also not something we usually provided, but I think with the expectation of the second half will be stronger than the first half, you know, with the product mix initiative we continue to drive with a total solution sales approach, that we're confident that our growth margin will improve over time. I just got it. Appreciate that, Emily. Before I ask my follow-up, I did want to congratulate Gary on his new role. I forgot to mention that. Well, thank you, Gary, you know, my honor. Brad, you want to talk a little bit about the manufacturing? Oh, yeah, Gary, I would just add to what Emily said regarding what we'd expect transitionally on margin, you know, connected to the revenue expectation that we're not guiding, but from a seasonal perspective, that's what we would expect. And then from a wafer service agreement, you know, we believe we've absorbed that transitionally and going forward, hopefully what we would see is that would kind of be a neutral to tailwind for us as we continue to work on technology qualification and the ability to port our product into these locations, as well as the ability to ramp revenue and that capacity being available to us. Got it. Thank you for that. It looks like you're bringing down, excuse me, your non-GAAP operating expenses by about 12%-13% from where they were a year ago. How much of that is variable versus structural? And the reason I'm asking the question is just trying to get a sense of by how much operating expenses improve when revenue improves. Yeah. So basically what you see in that is a combination of things. So we have taken, we continue to take action connected to variable things, as you mentioned, but we're also doing, you know, actions that provide restructuring inside the company to drive efficiency. We've also, you know, impacted with the performance we've had, that's been an impact on, you know, variable pay. And we continue to look at where our investments are. I think what you'll see is our continued focus on R&D, and that investment being kind of flat or tied with revenue growth. And from an SG&A perspective, continuing to look for opportunities to bring that down to drive structural efficiency and then not bring it up any more than, you know, some portion of what the revenue growth would be. Thanks, Brad. Excuse me. Our next question today comes from David Williams with Benchmark. Please go ahead. Hey, good afternoon, and let me add my congratulations to Gary. Thanks, David. Absolutely. So a lot of my questions were around the gross margin, but maybe just on the order velocity, I mean, if you can provide any color there. It sounds like, you know, it's still a mixed bag, but inventories are clearing and better in a few places. So just as you think about your order velocity through the quarter and maybe how those have trended so far into this Q1 here. Yeah. So, I think, you know, we definitely see improvement from the Book-to-Bill Ratio point of view. And, you know, so I think there's, you know, a lot of positive signals on the inventory side. I talk about, you know, within the three Cs, it's getting cleaner than ever before. So I think this is all positive. I think the unknowns is really the actual demand, especially after the Chinese New Year, right? I think the China recovery is still extremely slow than anybody's expectation. So I think overall, you know, unfortunately, still weaker from the business visibility point of view. We just need to continue to monitor it very closely. But, you know, definitely there's some good positive signs as well. Okay, great. Yes, and then, David, this is Gary. I would put some comment on that, too. So, you know, we're. I know we are going to put a lot of effort to the key account focuses. You know, that being said, we're going to put a lot of sales FA to work with key account to create the demand. At the same time, you know, when you see the short lead time PO continue to increase, you know, during this kind of period, and we kind of work with the distributor to put the right inventory in their, you know, in their, their warehouse to make sure they can handle this kind of short demand, you know, short lead time PO in timely basis. Okay, great. And I guess, do you get a sense that your customers that they are being fairly rational with their inventories and taking them to normal levels? Or do you get a sense that maybe those are being brought down too low, and you might get a bit of a snapback because of replenishment there? Yeah, I think that's a really challenging question, David. I think it's really down to the actual customer and their experience as well as their view. Sometimes also involve their financial cash flow situation, so it is a little bit dynamic, right? So what we have seen, I think what Gary mentioned, is we start to see more urgent orders, you know, which is really driven by probably not enough of the inventory buffer that they build into their formula, right? So because the customer base varies a lot, that also varies a lot as well, right? So that's really where the challenge. But I think just like Gary mentioned, we focus more onto the quality of the products on the shelf, so we can actually pretty much quickly adjusting our support to the customers with this kind of very short, you know, lead time orders, right? So, you know, that's really pretty much what we focused on and will continue to focus for the next few quarters as the market continue to evolve, right? Thanks so much. I appreciate the help. Any other questions? Hello? That was it for me. It just went silent. Yeah. Apologies, everyone. Our next question today comes from William Stein with Truist Securities. Please go ahead. Great. Thanks for taking my questions. Also, Gary, I learned out from my con- Thank you so much, Will. Sure. I'm hoping you can talk to the split of revenue that went direct versus to the channel in the quarter. Yeah. So, for the Q4, and our split by the channel is actually 65% distribution and 35 direct. This number usually varies a little from quarter to quarter. It depends on the customer demand and some of the order situation. I usually say rule of thumb is probably about 2/3 distribution, 1/3 the direct portion. Great. Thank you. Also, I wonder to what degree the inventory build helped gross margin for the quarter. Usually when, you know, it relates to a question I'll ask in concurrently with this, and that is utilization. Can you tell us what fab utilization was in the quarter, what you expect it to be next quarter, and then also the dynamic that I expect occurred in the Q4, which is when you build inventory like that, normally it, it's a boost to gross margin, and if you can quantify that. Thank you. Well, I think what you saw, Will, in terms of our, you know, we've talked about strategically putting availability in place, both from a kind of finished goods availability, but also from the availability as we procure, you know, about half of our wafers on the outside, you know, so that we can have flexibility in mix to build what we need. And so as you look at that and you look at utilization, and then you also look at typically in Q4, we're building in anticipation and preparing for Chinese New Year. And so when you look at the combination of that, what we saw from a utilization perspective was something that was pretty consistent. We continue to run below where we want to be. You know, we're and we believe that is something that's going to help us as we go forward, as revenue starts to hopefully strengthen, and we're in a position to be able to drive more inside the factory. So, we didn't really obviously, you know, it is all related, but we look at Q4, it wasn't something we drove utilization up in order to deliver those results. Okay. Thanks. Thank you. Our next question today comes from Tristan Gera with Baird. Please go ahead. Hi, good afternoon. So just going back on gross margin, what's the impact of underutilization in terms of fabs? And sorry if I missed if you quantified what the utilization rates are currently. And then is there a way to break down how much of the underutilization is from the service agreements, where I know you're qualifying new products to fill capacity as opposed to just a general weakness, you know, in demand? Well, what we've talked about, Tristan, was we talked about the fact that from an overall utilization perspective, we ran pretty consistent from third to Q4. We continue to run below where we want to be. You know, in doing that, we have, I think, successfully been able to get better availability in place to support short time ordering that we're seeing. We've also been able to address getting. You know, our hybrid manufacturing model services about half of our wafers outside the company, so we've put some more availability in place on that. That's not something that really drives up our utilization. And we believe that from a wafer service contract perspective, we've pretty much absorbed the negative impacts in transition, and we believe going forward, that's a kind of neutral to positive thing. As we continue to qualify our technologies internal, we can bring loadings internal, and we can help enable revenue growth. But in total, we're running below where we want to be, and we have been at that place for, you know, really all of this year, and we continue to be there, in anticipation for things to strengthen, as Emily had kind of gone through, and what we anticipate kind of going into 2024. Yeah, and one comment I would like to put it, Tristan, this is Gary. And when we visit several key account customer, you know, they kind of talked about the utilization of internal wafer fab, you know? That's - I think that's really kind of think about it, is like in the future growth, they, they really want to make sure that have this kind of capability can support the growth in the future. So I would say, like, we're still in the kind of under, you know, utilization level, as Brad mentioned about, but for the future, as long as we qualify our product and the process into our, our own internal fab, and we should have this kind of capability to support more business to our customer. Okay, that's great. And then for my follow-up, I believe most of your pricing agreements are in automotive. So outside of automotive, in terms of your revenue, that's not locked into a pricing agreement, I mean, what type of feedback are you getting from customers? Are people, you know, trying to ask for better pricing, or is it relatively stable? And how do you think that evolves, you know, through the rest of this year? Yeah, I think, Tristan, it really, varies a lot, depends on the end market, right? So you're absolutely right. Usually, in the automotive market segment, we actually have a longer time price matrix type of agreement in place with the customers. And, you know, for example, in the computing market segment, it's going to be a lot more function and feature, you know, protocol-driven discussions, than some of the others. Of course, our price competitiveness is given, right? If we take more extreme in the consumer market, because, you know, the overall cost is very sensitive, the demand's weaker, you tend to get more of the pricing discussions, right? So I think it varies a lot. It also varies from customer to customer, but in general, right, definitely as the demand's weaker, you definitely get a little bit more price pressure. It's almost going back to my discussion earlier. Depends on the product type. If it's a function feature, rich type of product, you get less of the competition. If it's a deep commodity, you get more. And just keep in mind that pre-COVID, Diodes actually had a 1.5%-2% built-in quarterly price reduction. So we actually definitely structured, you know, to support this kind of overall pricing, I would say trend. And, you know, the way to really, you know, focus on is actually improve the manufacturing efficiency and the cost down to really balance this kind of pressure that we're seeing in the market. Okay, great. That's very useful. Thank you very much. Thank you. This concludes today's question and answer session. I'd like to turn the conference back over to the company's president, Gary Yu. Thank you, everyone, for participating on today's call. We look forward to reporting our progress on next quarter's conference call. Operator, you may now disconnect it. Thank you, sir. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.