GSI Technology, Inc.

Standingby. Welcome to GSI Technologies' fourth quarter fiscal 2019 results conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. At that time, we will provide instructions for those interested in entering their queue for the Q&A. Before we begin today's call, the company has requested that I read the following Safe Harbor Statement. The matters discussed in this conference call may include forward-looking statements regarding future events and the future performance of GSI technology that involves risks and uncertainties that could cause actual results to differ materially from those anticipated. These risks and uncertainties are described in the company's Form 10 case filed with the Securities and Exchange Commission. Additionally, I have also been asked to advise you that this conference call is being recorded today, May 2, 2019. at the request of GSI Technology. Hosting the call today is Lee-Lean Shu, the company's Chairman, President, and Chief Executive Officer. With him are Douglas Schirle, Chief Financial Officer, and Didier Lasserre, Vice President of Sales. I would now like to turn the conference over to Mr. Shu. Please go ahead, sir.

Good afternoon, everyone, and thank you for joining us. GSI has a strong year in fiscal year 2019. We grew our revenue 21% and expanded gross margin by over 800 basis points. These gains help offset the increase in our research and development expenses on our APU as we continue evolving our business and bringing new products to market. As a result of strong revenue growth and increased gross profit, we narrowed our operating loss significantly and the year with positive late income. Our capital allocation strategy is to fund the commercialization of our APU, our patented input-associated computing technology for artificial intelligence applications. Our APU utilizes a unique architecture that greatly improves computation, search and response time. while reducing power. The configuration of the APU is designed to be optimal for technology search applications in stock discovery, e-commerce, and facial recognition. These are the initial markets we are pursuing with our device. We have identified bugs in our first-gen device. However, we are able to work along the bugs for the device to perform in the target application, and we have successfully demonstrated that ABU exceeds the performance of existing processors for similarity search. In the target category of Ken Informatics, which are computer methods used by pharmaceutical companies in drug discovery, we successfully demonstrated our ABU from the board and Paulette, our customers. The computation rate in our demo accelerated molecular search from minutes to seconds. The Weissman Institute team was very happy with the APU's performance. We anticipate that with the final silicon of the APU, we can further accelerate this search time down to milliseconds. In e-commerce, search is advancing to perform visual search online. In fact, a number of large e-commerce platforms currently have the ability to search with images as well as text. We believe that the APU improves the accuracy and speed in visual search, resulting in better outcomes. Similarly, for facial recognition, the APU can quickly, with high accuracy, identify faces, in suboptimal conditions such as low light, far distance, and moving of blurry image. These are large markets that we are confident the APU can surpass existing solutions. Our team is engaged with several target customers who are looking to enhance performance and outcomes. The next APU milestone is receiving our second silicon device from TSMC in two to three weeks. At that time, we will test the device and then build demo goals. This will allow us to determine if we have a device we can utilize for general demo. Anticipate that the second silicon device will perform to our expectations. We have a few customers, training facility at our headquarters in Sunnyvale, and have started creating our marketing materials. As a reminder, GSi currently holds 20 grand patents and 23 pending patents for our APU in the US. Our team of over 70 engineers based in Israel and Egypt is focused solely on our AI roadmap. These individuals have decades of product experience and AI expertise. Together, we have made solid progress in the goal of commercializing our APU. At this time, I'd like to hand the call over to Didier, who will discuss our business performance in further detail. Please go ahead, Didier. Thank you, Lee-Lean.

Switching gears to our new RadHard production of our Sigma QuadPrives, I am pleased to announce that we have successfully completed the series of critical testing for these parts. The internal qualification of this has been initiated. We expect the qualification to be completed in the second half of this calendar year. As we stated before, we anticipate having the RadHard chip available for shipments later in calendar 2019. On our sales breakdown, sales to Nokia were 41% of revenue during the fourth quarter of fiscal 2019 compared to 37% a year ago and 45% in the third quarter. We expect sales to Nokia to continue being strong for the remainder of the calendar year 2019. Military and defense sales were 22.1% of fourth quarter shipments as compared to 29.5% a year ago. The decrease was primarily due to higher sales to Nokia this year. We saw an increase in military and defense sales which increased from 16.7% in the fiscal third quarter due to shipments of RadHard engineering samples in this fourth quarter. Sigma Quad continues to be our best performing product category, sales of 57% of fourth quarter shipments compared to 45% last year and 70% in the preceding quarter. The preceding quarter Sigma Quad sales were unusually strong due to a one-time sale in a supercomputing application and also a very strong Q3 with Nokia, which we didn't expect to repeat in Q4. I'd now like to hand the call over to Doug.