GSI Technology, Inc.

Thank you. Thank you. Thank you. Thank you. Ladies and gentlemen, you are currently on hold for today's conference call. At this time, we're assembling today's audience and we plan to be on the way very shortly. We appreciate your patience. Please remain on this line. Thank you. Thank you. Thank you. Ladies and gentlemen, thank you for standing by. Welcome to GSI Technologies second quarter fiscal 2021 results conference call for the quarter ended September 30, 2020. 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 the queue for the Q&A. Before we begin today's call, the company has requested that I read the following Dave Harbour statement. The matters discussed in this conference call will include four 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-K files with the Securities and Exchange Commission. Additionally, they've also been asked to advise you that this conference call is being recorded today, which is October 29, 2020, at the request of GSI Technology. Hosting the call today is Leland Hsu, the company's chairman, president, and chief executive officer. And with him are Douglas Shelley, chief financial officer, and Didier Lezere, vice president of sales. And I'd like to turn the conference over to Mr. Xu. Please go ahead, sir.

Good afternoon, everyone, and thank you for joining us to discuss our second quarter 2021 financial results. Throughout the first half of fiscal year 2021, business disruptions related to COVID-19 continued to impact our financial results. The second quarter revenue of $6.7 million was at the midpoint of our revenue guidance. Higher SMA sales in the quarter improved gross margin to 46.7%, exceeding our forecast. Second quarter sales to Nokia were below last year's levels, but were up 89% from the prior quarter, offsetting weakness in other consumer segments, customer segments. Nokia is our largest customer, and earlier this year, they downgraded their outlook for the full year 2020 due to declining demand as customers delay pending plans. We have made significant progress on multiple forms with the Gemini One APU. Our revolutionary in-memory processor has continued to amaze us with its adaptability to new applications and our ability to improve the chip's performance through the software. Our software team has developed NeuroHash, a new algorithm to improve the speed of similarity search for a given accuracy rate. In October, we presented NeuroHash at the 2020 BayLearn Conference held by the Bay Area Machine Learning Symposium. Senior people from companies including Google, Apple, and Netflix, to name a few, make up the BayLearn organization and advisory committees, providing high-level industry exposure for GSI. The Bayland Symposium's goal is to bring together scientists in machine learning from the San Francisco Bay Area. This event offers exposure to key members of the research community and the technology industry. Second, to simplify writing code for the Gemini One APU, we developed a code generator and plan to release a compiler stack in early calendar 2021. The compiler will translate code written in Python to APU machine language. This program will allow developers to write code in high-level language like Python without requiring them to load the chip architecture and the internal logic details. Python is now the most popular programming language with over one-third of the programming market, making this tool key to gaining traction in the market. In the first quarter of calendar 2021, we expect to begin testing the 600 MHz Gemini 1. The goal is to start the qualification and have a final product for mass production in the first half of calendar 2021. Lastly, we have made progress on Gemini 2, the second product in our APU family, with a planned launch in May 2022. With all those of magnitude, performance caused improvement over Gemini 1. In closing, I want to highlight the software capability of the APU. In addition to a novel architecture, the APU has a very sophisticated software components. We have a large team dedicated to APU software development. There are four levels to APU software. First, applications. Integration for specific market applications, like Biovia for job discovery, facial recognition, image processing, and Hashcat for password recovery. Second, machine learning algorithms. We develop dual-level algorithms to enhance APU applications. The apps. We develop a library for specific applications, a solution by developer. And lastly, compiler stack, which I mentioned earlier. It's a stack for algorithm conversion, framework support, and simplified low-level code generation. This software capability will give GSI and APU a competitive advantage because it allows us to improve performance without changing the hardware for various applications. With that point, we are beginning to see the rewards of our software investment. The Israeli Ministry of Defense Research Arm launched the Mass Fat Challenge a series of data science prize competitions. The most recent contest, the MAFET Radar Challenge, a machine learning competition to distinguish between humans and animals in a radar track. The event drew over 1,000 participants and more than 4,300 submissions. I am pleased to announce that MAFET notified the Earth This week, the GSI algorithm is at the top of the leaderboard. In the next few weeks, the market will validate the leader's eligibility and officially announce the winner. If GSI is pronounced the official winner, this prestigious award could bring attention and heightened credibility to our team's software achievements. particularly with the Israeli projects that we are currently working on. The entire GSIT team is working hard to deliver on our goal of monetizing the investment we have made in the APU. Our timeline has been extended due to the COVID-19 pandemic, but we are making material progress on the technology and the marketing to build awareness. I am grateful for everything my team has accomplished. And I thank you for your support. Now I'll hand the call over to Didi, who will discuss our business performance in further detail. Please go ahead, Didi.

Thank you, Lilien. Starting with the sales breakdown for the second quarter of fiscal 2021, sales to Nokia were $3.4 million, or 51.7% of net revenues. compared to 5.3 million or 45.2% of net revenues in the same period a year ago and 1.8 million or 26.9% of net revenues in the prior quarter. Military defense sales were 26.9% of second quarter shipments compared to 23.4% of shipments in the comparable period a year ago and 30.1% of shipments in the prior quarter. Sigma Quad sales were 65.4% of second quarter shipments compared to 63.5% in the second quarter of fiscal 2020 and 46.3% for the previous quarter. For the remainder of the fiscal year 2021, we continue to anticipate a challenging business environment related to COVID-19 restrictions. Changes in customer buying patterns, communications constraints with our customers, The postponement of investment and the restricted activity of our sales force and distributors may impact demand and our ability to close sales across customer segments. With this backdrop, our new product sales process is taking longer than usual. Selling new products requires a longer cycle than selling established products. Ideally, we conduct sales meetings in person and spend the time educating customers on how our new product will change their current practices. Without face-to-face meetings or training workshops, the pace moving the sales process forward has slowed. The targets for radiation-hardened SRAMs are mostly national assets and top secret applications. Sales communications in this channel have slowed due to the lack of access to secure communication facilities. In the late quarter, I'm sorry, in late calendar 2020 or in early 2021, Once funding is released, we anticipate radiation-tolerant SRAM orders for imaging satellites and space applications. Similarly, we are making progress on Gemini 1 customers on several fronts as prospects test the solution. We are working closely with a few potential large customers now. That said, given the business challenges to educate and train new customers, we now anticipate design wins and initial sales of Gemini leaderboards into calendar 2021. On the marketing front, GSI has taken steps to raise awareness in the relevant sectors for the Gemini One APU and our company. We are engaging with industry analysts to gain exposure to leading providers of market intelligence for the technology and telecommunication markets. Our team is expanding its participation in high-profile industry events and conferences where GSI can gain recognition as a leading developer of a revolutionary solution for AI computing and have exposure to leading companies in the sector. Globally, we are redesigning our market-facing collateral, including our website, to align our messaging and image with the technology leader's identity. All of these efforts support our sales teams as they build new relationships and bridge the GSI reputation as a leader in the SRAM memory market to an innovator in the AI market. I'd like to hand the call over to Doug Doug, go ahead, please.