GSI Technology, Inc.

Ladies and gentlemen, thank you for standing by. Welcome to GSI Technologies second quarter fiscal 2024 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 the 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 involve risk 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 filed with Securities and Exchange Commission. Additionally, I have also been asked to advise you that this conference call is being recorded today, October 26, 2023, at the request of GSI Technology. Pulsing the call today is Li-Lin Xu, the company's Chairman, President, and Chief Executive Officer. With him are Douglas Shirl, Chief Financial Officer, and Didier Lazare, Vice President of Sales. I would now like to turn the conference over to Mr. Hsu. Please go ahead, sir.

Good afternoon, and thank you for joining us to review our second quarter fiscal 2024 financial results. I am pleased to share that we have achieved two significant milestones since we reported Q1 2024 earnings. First was the successful launch of the alpha version of our Copperhead compiler suite, a Python-based tool that can harness the capabilities of the Gemini APU. We anticipate releasing the general release of the Copperhead compiler suite in early 2024. A full production version will be available later in 2024. Currently, we have partners learning, using, and developing algorithms with our compiler, including Swag, a consortium of universities and companies developing next-generation technology for space, and academic research groups exploring the future of computing architecture, like MIT and the University of California, Riverside. The second milestone was the completion of the Gemini 2 table, which was launched last week. As a result, we are on track to have the chip back in our hands early next calendar year and begin sampling the device in the second half of 2024. We are targeting Gemini 2 partners and the customers in low-power data center expansion and enabling data center functions at edge. Examples of edge applications could include advanced driver assistance systems and HPC in delivery zones, autonomous slow bus, unmanned aerial vehicles, and satellites. Turning to our financial results for the second quarter, revenue of $5.7 million was at the high end of our guidance. Also, it's worth noting that our second quarter fiscal year 2023 revenue was boosted by inventory builds with several key customers, which presents a challenging year-over-year comparison. In addition to advancing the table of Gemini 2, a significant area of recent focus has centered around our ongoing engagement with a key hyperscaler partner, I am delighted to report that these discussions are making notable progress. Through our constructive dialogue with these leading cloud computing providers, we have gained invaluable insights into the precise design specifications required for Gemini 3 to align with their requirements. This collaborative effort has enabled us to chart a roadmap for identifying potential partners who can bring the essential financial engagement engineering resource to the table for the successful development, manufacturing, and the launch of Gemini 3. The evolution will leverage the incorporation of high bandwidth memory into the APU architecture, thereby harness the full potential of in-memory compute advantage. Now, I will hand the call over to Didier, who will discuss our business performance further. Please go ahead, Didi.

Thank you, Lilien. Following up on the projects I mentioned last quarter, throughout the second quarter of fiscal 2024, our team continued to pursue opportunities with GeminiOne to advance our customer engagements. Currently, GSI has a fast vector search plugin available that allows cloud vector search users to seamlessly add APU accelerated search to their major cloud-provided hosted workloads. with minimal latency from GSI's hosted data centers. This FVS plugin provides accelerated approximate nearest neighbor search response times, enabling access to a large enterprise service at low power that also meets price points for small and medium-sized businesses. This will be opening up larger markets for us. Switching to our SAR opportunities, due to customer feedback, we have decided to launch our low-powered, highly efficient SAR processing as a SAS offering, along with, of course, also the on-prem version. We are now engaging to bring that service to market. Moreover, we favorably completed benchmarking on a customer's data set. One target we are engaged with, a startup building satellites that can provide computational capabilities on satellites in space, has identified the Gemini APU as its preferred provider for computing solutions for space. The big differentiator, in addition to low power performance, is the product's radiation-tolerant feature. On that note, we will be conducting full radiation-tolerant testing on Gemini 1 next month. By this, I mean the full range of tests required for customers considering using Gemini 1 in space. One of the applications for that radiation-tolerant Gemini 1 would be ideally suited for SAR, and ATR, which is automatic target recognition, and computing in space, to name a few. This summer, we announced that GSI was awarded an SBIR contract to perform a feasibility study to adapt Gemini 2 to perform computing at the edge in collaboration with the US Air Force and Space Force. We are currently working on a second SBIR based on the Gemini 2 software development. which is very promising and potentially a similar financial award as the first win. We continue to file more SBIRs as they bring two key benefits. Number one, a source of revenue, and they also create use cases within the U.S. government for future APU opportunities. Let me switch now to customer and product breakdowns for the second quarter. In the second quarter of fiscal 2024, sales to Nokia were 1.2 million, or 20.3% of net revenues, compared to 1.2 million or 13.6% of net revenues in the same period a year ago, and 1.9 million or 33.5% of net revenues in the prior quarter. Military defense sales were 34.8% of second quarter shipments compared to 22.4% of shipments in the comparable year, I'm sorry, comparable period a year ago, and 33.8% of shipments in the prior quarter. Sigma quad sales were were 55.8% of second quarter shipments compared to 58.1% in the second quarter of fiscal 2023 and 58.6% in the prior quarter. I would like now to hand the call over to Doug.