GSI Technology, Inc.

Ladies and gentlemen, thank you for standing by. Welcome to the GSI Technologies fourth quarter and fiscal year 2020 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 who are interested in entering the queue for Q&A. Before we begin today's call, the company has requested that I read the following Safe Harbors 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 forms 10Q and 10K, followed with the Securities and Exchange Commission. Many of these risks are currently amplified by and will continue to be amplified by, or in the future may be amplified by, the COVID-19 global pandemic. Additionally, I have also been asked to advise you But this conference call is being recorded today, May 7, 2020, 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 and Didier Lasserre, Vice President of Sales. I would now like to turn the conference over to Mr. Xu. Please go ahead, sir.

Good afternoon and thank you for joining the call. Today we will explain the status of our business in the current environment, provide an update on our APU products, and report on our fourth quarter and full year fiscal 2020 financial results. Despite the uncertainty created by the COVID-19 global pandemic, we remain focused on our long-term strategy. The COVID-19 global pandemic has created unique circumstances for all our stakeholders, and we have instituted many preventive measures and are regularly evaluating those measures and others as we continue to better understand the environment that we are and will be operating in. We are confident in GSR Technologies' ability to succeed in these difficult times given our strong financial position. Our team's tremendous experience and knowledge in our legacy business that provides funding for our new product line. On March 31, 2020, we had over $70 million in cash, cash equivalent and short-term and long-term investment. We slowed down. Outside of Taiwan, there were, where there are low shelter-at-home orders in place, the majority of our employees around the world are working from home. Our productivity has remained high. and we are moving forward of achieving our product milestones. I am grateful for all of our employees' commitment to delivering excellence in product, service and support during this challenging time. In the fourth quarter, we completed the benchmarking of our initial AP product, Gemini One. In early April, we published The benchmark result was Gemini One in a billion-scale similarity search using the server containing four Gemini APU boards, running at a rate of 400 MHz. The results showed that Gemini One performed extremely fast, accurate search on large data sets with a smaller footprint and lower power consumption for a much lower total cost of ownership. Humanized high performance in speed and accuracy with lower total cost ownership is a significant distinction in today's search solution. Real-time search of large databases is increasingly a critical function that is transforming business, scientific, and governmental process. The ability to replace more expensive solutions and provide better performance et al. were able to end the new market with Gemini One. There are many differentiators in the Gemini One architecture that creates this enhanced performance. The primary differentiator is the memory-centric design that removes the limitation of serial processing. The Gemini APU trained the database into the memory that is also served as processors. This configuration shows the system to use fewer CPUs and GPUs and compressed computation speeds from tens of minutes to seconds, even microseconds, in numerous critical search applications. Another key differentiator is the number of ALUs or arithmetic and a large GPU unit on a Gemini chip. A GPU typically has thousands of AAUs, and a CPU has about a dozen. Gemini One has two million AAUs, allowing the APU to break down the query into a much more granular search. Loss of internal memory and the database load into the APU reduce search time and use less power to perform the to perform the computation. Scalability is another critical differentiator of the Gemini ATU. For large databases that cannot fit in one ATU chip, we can integrate multiple boards with many chips into the server. We can build servers with multiple Gemini boards to scale with the size of the database by retaining our performance and keeping power consumption low. Gemini L1 memory loaded with the entire database allows for extremely fast processing time. In some such applications, kernel solutions require a large number of expensive GPUs and CPUs to deliver performance at scale. The search market is growing, and these new solutions, such as the Gemini APU, that deliver own performance while keeping the total cost of ownership low. Finally, Gemini can serve the broader search market as a universal hardware solution and address many different specific use cases, same to its flexibility and customizable software. Our software library and algorithm can tailor Gemini for unique search applications with a multiple level of custom programming from assembly code and Arthur Tenzerfeld. There are many different applications for search. We will continue to develop our solutions to address more of these applications over time. Despite the unique current circumstances for all of our stakeholders caused by the COVID-19 global pandemic, we remain focused on executing the multiple opportunities that are ahead for GSI. Let's last examine about our progress on Gemini One. The core business will be variable for the real-time, but our SM products continue to be essential for military and defense, as well as telecommunication and the networking customers. Doug will comment on our first physical code outlook in his prepared schema. Now I will hand the call over to Didier. who will highlight the sales and marketing progress on Gemini One and review our business segment performance. Please go ahead, Didier.

Thank you, Lee-Lean. I'm pleased to report that we are actively marketing Gemini. Our marketing team has created sales collateral to educate end users on all the unique performance characteristics and capabilities of Gemini One. Outreach is now ongoing for facial recognition and drug discovery. We are preparing to commence engaging with military and government customers for signal classification, object detection, and cryptography. Due to current COVID-19 shelter-in-place and work-from-home restrictions, we are building remote cloud-based workshops. We plan to use these remote workshops for demonstrations of Gemini One's functionality and conduct training with customers on our algorithms and software libraries. Let me share a couple of specific examples of Gemini One's performance in two applications we are currently pursuing. I am very excited about Gemini's performance in facial recognition search. Our performance data shows prospective customers that the Gemini One facial recognition search engine can process databases of up to 200 million faces with a single APU board. In these searches, Gemini One is delivering highly accurate results while reducing the query times from many minutes to fractions of a second, all with much lower power consumption and edge processing. Another exciting market we are currently developing is drug discovery. You may recall that in the late 2018, we announced a collaboration with the Wiseman Institute in Israel on cheminformatics research. They were an early user of a beta Gemini APU solution. They saw markedly improved productivity with the APU's parallel processing technology with the ability to run multiple molecule queries at speeds that far exceed the CPU search capabilities. Now, researchers at the Wiseman Institute are using newly installed boards containing the Gemini 1 APU. Based on the premise that structurally similar molecules exhibit similar biological activities, scientists are researching for the structurally similar compounds to existing drugs that have been successful in treating diseases and fighting viruses. With boards containing Gemini 1, Wiseman Institute researchers perform quicker searches using more queries to their database to find molecules with similar properties to their query molecules. The ultimate goal is to decrease the time needed to go from research into clinical trials. Shifting to our sales breakdown for the fourth quarter of fiscal 2020, sales to Nokia were $2.4 million or 28.3% of net revenues compared to $5.2 million or 41.1% of revenues in the same period a year ago. and 2.6 million or 26.3% of net revenues in the prior quarter. Nokia sales have been slower in recent quarters, which we expect to continue through the end of June. The situation is somewhat fluid and a subject to change, but at this time Nokia's preliminary forecast shows an improvement in sales in the second half of calendar 2020. Military and defense sales were 30.9% of fourth quarter shipments compared to 22.1% a year ago and 18.9% in the prior quarter. SigmaQuad continues to be our best performing product category with sales of 44.7% of fourth quarter shipments compared to 57.4% in the fourth quarter of last year and 62% in the preceding third quarter. I'd now like to hand the call over to Doug.