Super Micro Computer, Inc.

Good day. Thank you for standing by. Welcome to the Supermicro Fiscal Q3 2021 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the conference, please press star then zero on your touchtone telephone. I would now like to turn the conference over to your host, Mystical Notios with Investor Relations. Thank you.

Mystical Notios Good afternoon, and thank you for attending Supermicro's call to discuss financial results for the third quarter of fiscal 2021, which ended March 31, 2021. By now, you should have received a copy of the news release from the company that was distributed at the close of regular trading and is available on the company's website. As a reminder, during today's call, the company referred to a presentation that's available to participants in the IR section of the company's website under Events and Presentation Staff. We've also published management scripted commentaries on our website. Please note that some of the information you hear during the discussion today will consist of forward-looking statements including, without limitation, those regarding revenue, gross margin, operating expenses, other income and expenses, taxes, capital allocation, and future business outlook, including the potential impact of COVID-19 on a company's business and results of operations. There are a number of risk factors that can cause Supermicro's future results to differ maturely from our expectations. To learn more about these risks in the price leads we issued earlier this afternoon, our most recent 10-K filing for fiscal 2020, and our other SEC filings. All these documents are available on the IR section of Supermicro's website. We assume no obligation to update any for the statement. Most of today's presentation refer to non-GAAP financial results and business outlook. For an explanation of our non-GAAP financial measures, please refer to the accompanying presentation or to our press release published earlier today. In addition, a reconciliation of GAAP to non-GAAP results is contained in today's press release and in the supplemental information attached in today's presentation. At the end of today's prepared remarks, you will have a Q&A session for self-analysis to ask questions. I'd now like to turn the call over to Charles Liang, Chairman and Chief Executive Officer.

Thank you, Nicole, and good afternoon, everyone. Last quarter, we have performed our growth strategy well by winning new key customers, extended our global operation, and introduced a whole new generation of products. Today, we have released our fiscal 2021 third quarter financial results. Let's take a look at some highlights. Our fiscal third quarter net sales totaled $896 million, up 16% year-over-year and up 8% sequentially. For the first time in our company's history since IPO, the revenue from seasonally week March quarter significantly surpassed that of December quarter. Our physical third quarter long gap earning per share was $0.50, above the midpoint of our previously guide range of $0.37 to $0.57. In this quarter, we also generated record revenue from the Asia-Pacific region, demonstrating our continued and expanding traction in Asia. We continue to execute our three-year growth strategy highlights in our recent investor update on March 4th. Our progress, judged by historical industry growth rate had prepared us to resume the position of the fastest-growing EUSA-based server storage manufacturer. Most importantly, we achieved this despite so much of our focus had been on growing the company's long-term foundation. Earlier this quarter, we introduced the industry's most comprehensive server portfolio, leveraging the latest processors from both Intel and AMD. Our application-optimized solutions are gaining traction among the world's most advanced data centers and enterprises. We have several commit earlier ship customers that have deployed thousands of server units. led by our super-series. We also set up optimized systems for many verticals, such as artificial intelligence, telco, cloud, and more. One successful example is our cooperation with Osaka University in Japan with our liquid-cooled HPC solutions, which take full advantage of our new powerful ice bag processor. Hundreds of other customers have already utilized our early sampling program or accessed the new system online through our Jump Start program. These activities to accelerate the deployment ramp of this new generation product and prepare growth for this calendar year. In addition to the system based on the new CPUs, We released an innovative new GPU system architecture last quarter with resource saving in mind. With very strong global demand, the optimized 2U2NOT GPU solution delivers greater cost savings utilizing shared power and cooling. This 2U2NOT system supports three double-width or six single-width PCIe Gen4 GPUs. and is the best platform for video streaming, high-end cloud gaming, and companies' social networking applications. We have been executing a robust manufacturing plan in Taiwan for a few years. With attractive new product lines and strong customer demand, recognize the importance of optimizing operational efficiency and reduce cost, especially with a tighter supply chain. As one of the key elements of our strategy, our Taiwan campus expansion will increase our capacity and capability in production, operation, engineering, and sales to deliver more cost-optimized offerings. Manufacturing costs have been our painful challenge since the company was founded 27 years ago. Now, with the new 1 million square feet of manufacturing and office space added to our Taiwan campus this summer, we will become more profitable by having more control over our global supply chain and manufacturing costs. Now, U.S. campus expansion, which will be online shortly after the completion of the Taiwan expansion, will focus on similar operation goals, but with more emphasis on security and Made in USA initiatives. Again, this expansion will position us well to handle the ongoing logistic challenge and rising costs while further improve our time-to-market advantage and production scale and agility. We are making progress in the key growth factors, as I mentioned in our base center investor event. And we are getting greater traction within the critical segment of our cloud data center and enterprise account. We are securing a new design wing and seeing expanded orders from certain high-profile customers. These customers are choosing Supermicro based on the breadth of our portfolio and our ability to deliver the best optimized system for their 5G, telco, AI, and both public and private cloud workloads. We have been efficiently growing our high-profile account worldwide. and we aim to double this account in the coming two years. Our high-profile customer initiatives is a big portion of our organic growth strategy that has evolved and been fine-tuned over time. We also continue our sales transformation effort by broadly launching our B2B and B2C automation with the auto-configurator tool, which is already in use with many selected customers. This tool will make it much easier to share communication, technical data, and product configurations among our sales engineers and customers, which I believe will accelerate revenue and reduce fulfillment time and cost. Strong positive momentum is building again at Supermicro. I believe our Q3 growth is just the beginning of our journal to gain more market share again. We are returning to our hallmark of consistent growth. To align my interest with the company's growth strategy, the Board of Directors accepted a proposal of reducing my annual salary. to $1 and add an equity compensation package tied to very aggressive revenue and stock price target. Also in our recent investor update, I talked about our path to $10 billion in annual sales in three to six years. Now I have even stronger confidence to achieve this goal. Over the past years, SimpleMango has succeeded in various market segments, such as storage, HCI, cloud, AI, machine learning, 5G telco, and others. We have established our technology leadership through optimized server and storage solutions. I'm excited that our recent booking activity, along with our capacity expansion, and improving COVID outlook give us the confidence to provide a strong Q4 guidance. Our coming fiscal Q4 revenue will surpass $1 billion in the range of $980 million to $1.08 billion. Supermicro is finally back on track for faster growth, and I'm confident that Our growth rate will be getting faster and faster in the coming quarters and years. I will now pass the call to David Wagan, our Chief Financial Officer, to provide additional detail on the quarter and our outlook.