eMemory Technology Inc. ($3529)

Good afternoon, everyone. Welcome to eMemory's First Quarter 2026 Webcast Investor Conference. Joining us today is our Chairman, Dr. Charles Hsu; President, Mr. Michael Ho; Head of IR, Ms. Li-Jeng Chen; Director of the Finance Department, Mr. Joseph Hsia; and Head of Digital Marketing, Dr. Felix Hsu. The format of today's event will be as follows. First, eMemory's Chairman, Dr. Charles Hsu will give an opening remark. Afterwards, our Financial Officer, Mr. Joseph Hsia will present a review of our financial results. Following that, President, Mr. Michael Ho, will share our business outlook. Next, Head of Digital Marketing, Dr. Felix, who will give a [indiscernible] titled hardware security for AI agents. Then we will conclude today's conference with the Q&A session where our management team will answer your questions. [Operator Instructions] As a reminder, this conference is being recorded, and a webcast replay will be available after the conference is finished. For more information, please visit the company's website under Investor Relations section. As usual, before we begin, we would like to remind everyone that today's presentation may contain forward-looking statements subject to risk factors associated with the semiconductor and IP business. Please refer to the cautionary statement on Page 3 of today's presentation. Now I would like to give the floor over to eMemory's Chairman, Dr. Charles Hsu.

Thank you. Good afternoon, everyone. In the first quarter of this year, eMemory continued to deliver record high operating performance in addition to sustained growth in 3-nanometer licensing for AI server CPU applications. We also successfully expand into new areas such as high-speed interface applications. Meanwhile, as AI infrastructure rapidly evolves industry demand for hardware security is undergoing fundamental upgrade. The Open Compute Project Foundations Chiplet System Architecture introduced in 2025 explicit requires every chip within chiplet system to incorporate hardware of trust. And this signified that average in the future AI system will require billing hardware security mechanism to ensure system integrity and data security. First of all, the rapid advancement of agentic AI together with increasing government requirements worldwide for Post-Quantum Cryptography is driven what we believe to be the most significant hardware security upgrade cycle in the past 2 decades. In response to this trend, we are actively involving from an IP providers into a system-level security solution provider. Our internal developed hardware security module product is expected to be officially licensed for customers' mass production deployment upon completion of U.S. NIST, National Institute of Standard and Technology validation. We believe in memory will be one of the key benefit of this global hardware security upgrade trends. At the same time, the call technological foundation of in-memory remains in the -- as logic nonvolatile memory. We have a long focus on enabling nonvolatile memory technology through standard logic processes in addition to being embedded into SoC in IP form. This technology also have the potential to evolve into stand-alone memory products. Recently, global Flash memory supply has remained constrained. eMemory's key advantage lies in our ability to directly leverage mature logic process capacity to produce nonvolatile memory, avoiding the capacity bottlenecks associated with conventional dedicated flash manufacturing lines. We are currently working closely with multiple foundries to advance the related technology and the commercialization efforts. This development not only carry strong strategic value for foundries and end system customers, but also has the potential to become the next major growth driver for memory revenue and probability following the OTP and the PUF security solutions. So next, I would like to and by our CFO, Mr. Joseph Hsia to present the operating results for the first quarter of 2026.

Good afternoon, everyone. Thank you for joining us. Now allow me to walk you through our financial results for the first quarter of 2026. 2026 Q1 revenue was TWD 1.09 billion, increasing 4.4% quarter-over-quarter and 20% year-over-year. Operating expenses were TWD 432 million up 4.6% sequentially and up 10.8% year-over-year. As a result, our operating income reached TWD 662 million, representing an increase of 4.2% quarter-over-quarter, an increase of 26.8% year-over-year. Operating margin was 60.5%, relatively flat sequentially, down by 0.1 percentage point, but increased by 3.2 percentage points year-over-year. Net income for the quarter was TWD 596 million experienced an increase of 5.9% sequentially, an increase of 29.1% year-over-year. EPS for this quarter was TWD 7.98. And next, let's move on to revenue mix by licensing and royalty. Licensing in the first quarter accounted for 34.8% of the total revenue, up 9.9% sequentially and up 58.6% year-over-year -- on a U.S. dollar basis, licensing grew 7.8% quarter-over-quarter and 64.4% year-over-year. Royalties on the other hand, contributed 65.2% of the total revenue, increasing 1.6% sequentially and increasing 6.2% year-over-year. On a U.S. dollar basis, there was a 1.2% decrease quarter-over-quarter but 11% increase year-over-year. Overall, revenue increased by 4.4% quarter-over-quarter and 20% year-over-year. On a U.S. dollar basis, the growth was even stronger at 1.8% quarter-over-quarter and 25.2% year-over-year. And with that, I will break down the revenue contribution by specified IPs. First of all, NeoBit now accounted for around 20% of the total revenue in the first quarter. Its licensing revenue decreased 28.4% sequentially and decreased 13.7% year-over-year. while royalties increased 3.1% sequentially but down 4.2% year-over-year. Secondly, for NeoFuse. NeoFuse accounted for around 59.8% of the total revenue in the first quarter. Its licensing revenue increased 39.8% sequentially and increased 20.7% year-over-year. In terms of royalty revenue, new fees royalty increased by 0.5% sequentially and increased by 7.4% year-over-year. For PUF-based security IP, it contributed around 12.2% of the total revenue in the first quarter. Its licensing revenue increased 21.5% sequentially and increased by 606.9% year-over-year. While its revenue account for around 1% of the total royalties in the first quarter. And lastly, for MTP technology, it accounted for around 8% of the total revenue in the first quarter. as licensing revenue decreased by 5.5% sequentially but increased 37.9% year-over-year. Royalty from MTP was down 3.1% sequentially but increased by 45% year-over-year. And now let's look at royalties for 8-inch and 12-inch wafers. 8-inch wafers accounted for around 33.7% of the royalties in the first quarter down 5.5% sequentially and down 15.9% year-over-year. On a U.S. dollar basis, this represents a sequential decrease of 8.2% and a year-over-year decrease of 12%. On the other hand, 12-inch wafers contributed 66.3% of the total royalties in the first quarter, up 5.6% sequentially and up 22.5% year-over-year. On a U.S. dollar basis, this represents a sequential increase of 2.8% and a year-over-year increase of 28%. The A total of 139 licensed product tape-outs were completed in the first quarter of 2026, and further details will be provided in our management report, which will be released shortly after this earnings call. And next, I would like to pass the floor to our President, Michael Ho, to share more about our future outlook. Thank you.

Good afternoon, everyone. In the following section, I will address our future outlook. Licensing revenue is driven by an increase in the number of license from both foundries and fabless customers as well as higher average selling price per license. Demand remains strong for advanced node technologies, air-related applications, security-related solutions and next-generation fresh technologies. For royalty revenue continued to accelerate, driven by upgrades of existing products, higher ASPs from the new advanced node applications, expanding part of royalty contributions and a growing mix of higher royalty rate MTP products. For the new IP technologies, one, continued development of next-generation OTP and PUF-based hardware security solution targeting sub 2-nanometer process nodes. Two, NeoFlash spending in both embedded and stand-alone 1T-Flash applications, leveraging large process-based architecture for improved scalability and cost efficiency. For business development platforms, one, Chiplet Security Platform. The company is collaborating with ecosystem partners to develop end-to-end chiplet security solutions, covering key technologies, including the supply chain security, chiplet authentication, secure communication and the hardware route of trust. These solutions are designed to address the licensing security requirement driven by AI and heterogeneous integration architectures Two, for Data Center Caliptra Platform, targeting data center and AI server applications, we are developing a comprehensive IP platform that combines PUF-based route of trust with a security subsistent architecture. This platform enable customers to accelerate adoption and mass production of hardware security solutions, compliant with the Caliptra framework and the future data center security standards; three, Root of Trust and CPU platform collaboration. Our hardware security technologies have been successfully integrated into the latest generation AI/AGI CPU platforms of major CPU vendors, providing chip-level Root of Trust, Secure Boot, device identity and secure key protection capabilities. These technologies enhance trustworthiness and secure across the AI system from the chip to system level. For HSM Edge Server Platform. Our PUF-based HSM a server is positioned as a key infrastructure component for future Security-as-a-Service, SECaaS platforms. The platform supports critical applications, including secure OTA updates privacy protection, device identity management and Post Quantum Cryptography migration for the automotive, medical, industrial control, Edge AI and other high security systems helping the customer build sustainable next-generation security architectures. This concludes my comments. I will now hand over to Felix, our Head of Digital Marketing. Thank you.

Good afternoon, everyone. Thank you for being here. The industry has spent the last few years building agents that can act on the world, but not enough time building the foundation that makes those actions trustworthy. That serious need for security is what we're going to talk about today. and an agent is not just a chatbot, a chatbot answers an agent acts. It runs in the loop. First, it gathers context, then the reasons. It decides that it executes in the real world and it records a result and provide status update, then it does it again and again. There are 3 key things we need to know about this loop. First is autonomous. The agent decides for itself. There's no human pressing approve between steps Second, it runs at machine speed. We're talking over 1,000 decisions per minute. No compliance officer, no security team, no human reviewer can keep up with that in real time. It is mathematically impossible. And third, this is an important point. Different steps carry vastly different stakes. When the agent is reasoning internally, a mistake is recoverable. But the moment that the loop touches the external world, which involves money, contracts, identity infrastructure. stakes become absolute. There is no undue button on the wire transfer. And there's no roll back on a signed contract. Every single step of the Asian loop, there are 2 distinctive categories of risk. The first 1 one integrity risk, whether the agent is thinking with the right information, whether it's being fed false data, whether it's reasoning engine is one, the one we deployed. Or has been silently swapped, whether it's memory has been tampered with. The second one is authorization risk. Whether the agent is allowed to do what is it about to do, whether the action was approved by a human. Whether the agent is either who it claims to be. There are fundamentally different problems. And here's what the market has missed because most of the security industry today only address one of them, usually its integrity through software signing and model verification. However, the authorization side, no matter who has the right to act is largely being handled by software policies that an attacker or even misaligned agent can route around. You cannot have governance without solving both. A perfectly authentic model executing in unauthorized transaction is still a catastrophe. An authorized agent running tampered logic is still a catastrophe. Both columns have to be risk-free. Today in production AI deployment, they're not. Every major regulatory framework now being written, including the EU AI Act, the emerging U.S. governance frameworks, the financial sector guidelines. They all converge on the same 4 requirements. First, is a human loop approval for high-stakes decisions. Then there's tamper-proof audit logs. Protection of models from theft. And finally, zero-trust authentication on every interaction. Every AI vendor in the world will tell you they offer these things and every one of those promises in current implementations has the same fatal weakness. It lives in software. So in the case where PUF is absent, having software is not sufficient, as shown in the right column. Software signatures can be for software audit trails can be rewritten by anyone with sufficient privilege. Software keys can be extracted. Software identity can be impersonated. What this means in practice is that today's AI governance is to use a phrase, we keep hearing from CISOs, governance theater. It looks compliant on paper. It does not survive contract with a determined attacker. The only way to make these promises enforceable rather than aspirational is to follow the middle column, knowing what governance requires and anchoring the promises and something that we know the exact identity of with signatures that cannot be copied or extracted. Keys that cannot be stolen, which essentially is describing hardware. In other words, it has to be properly of the silicon itself. it has to be a property of the silicon itself. Unique to each chip generated at the moment of need and never stored it anywhere. It can be stolen, all arrows are pointing to PUF. Thus, we, eMemory, provide the foundation there. The hardware root of trust. And on top of that foundation, 3 properties become possible. The properties that no software-only stack can deliver. First is identity. Every AI agent, every device, every triple, every endpoint gets in a unforgeable identity that is intrinsic to its silicone. It cannot be cloned because the physical randomness that derives from cannot be replicated. Even by the foundry that made the chip. Next is integrity, models, prompts and agent logic stay sealed to the hardware that's authorized to run them. If you steal the model file and it's useless. Blob of encrypted bytes. There's no key file to steal alongside it because the key is never written down. Then finally, there's authority, human loop approval, audit logs, policy enforcement, all of these regulators are mandating. Become cryptographically enforceable rather than procedurally promised. The audit log is no longer what the system says happens. It is approvable in court, if necessary, by anyone with the public verification keys. The AI governance platforms, the agent orchestration tools, the compliance dashboards. These are all available, and they are all building real businesses. So eMemory is positioned at the hardware layer that everything else depends on. In summary, by moving security from the software layer to the silicon itself, eMemory enables agenetic AI to operate with the level of autonomy and authority required for high-stakes industries like finance, health care and autonomous infrastructure. Okay. That includes my talk. Thank you for your time.

Thank you, Felix. This concludes our prepared statements.

Next, we will enter the Q&A session. We will now begin the Q&A section. Questions will follow by the formats of answering the Chinese version first followed by the English version. We will now collect the questions and begin our Q&A section.

[Foreign Language] Royalty revenue in April declined compared with the previous quarter, while foundry revenues generally increased quarter-over-quarter in Q1, together with the potential impact from foundry price increases. Is there any particular reason for this difference? Michael, please?

Based on what we have heard, foundry price increase generally start from the second quarter or expect to take effect in the second half of the year. Therefore, the impact was not yet reflected in the first quarter royalty. The decline in royalty revenue was mainly due to a temporary disruption caused by the sale of one Taiwan-based foundry customer. The foundry happened to be the production site for certain end customer applications, which led to a short-term decline in royalty contribution. We expect this impact will be temporary as the chip customers ship production to other foundries, the related royalty revenue should gradually recover.

What was the reason behind the decline in 8-inch royalty revenue in the first quarter? Will the recent increase in 8-inch foundry pricing provides support going forward. Michael, please.

The royalty revenue recognized in Q1 reflect the foundry shipment from the fourth quarter of last year and therefore, still reflect last year's foundry pricing. Since foundry price increase are being implemented gradually this year, the impact of our royalty revenue is expected to be reflected in the second half of the year.

As ramp becomes increasingly important and die size or density continue to grow. There is a stronger incentive for customers to adopt repair IP. Could you share the company's development progress in AI-related projects in this area? How many projects are currently in the pipeline? And could we start to see royalty contributions in the coming years? Michael, please?

Our OTP has long played an important role in SRAM repair applications. We have already worked with Siemens to integrate our technology with their Tessent software. Offering the validated solution that helps simplify the design process and accelerate customer adoption. Currently, the company has multiple AI-related SRAM repair design-ins mainly focused on the advanced node chips such as AI data center processors, memory controllers and CSL-related devices. As these designs are finalized and moved into mass production, we expect the related royalty contribution to become increasingly visible.

Could you provide more details on the development of the company's 1T-Flash architecture and technology, can this technology be used for both nor and multi-level cell or MLC applications. Are there any foundries or IC design customers currently engaging with the company? And Charles, please?

1T NeoFlash adopts an innovative right architecture that overcomes the limitation of the conventional IT design and remove the address [indiscernible] component. And this significantly reduced the memory [indiscernible] area. Essentially, this is a fresh technology built on the standard logic processes and its key advantage to include the ability to support both embedded flash and the stand-alone flash, shorter development cycle, lower cost and higher yield and greater manufacturing capability. We believe this represents a significant innovation as both embedded and stand-alone flash. It can be more easily implemented using existing logic process platforms. the technology can support no flash, 2D non-flash and the multi-label flash cell all MLC applications. The technology has now entered the active development stage, and we are already cooperating with several foundries and fabless companies.

What are the key differences between embedded memory technology and stand-alone memory products? Can the know-how we have accumulated in embedded memory, be directly applied to stand-alone memory also who are the potential customers, Charles, please?

eMemory has long built its core technology platform around lodging on volatile memory. This platform helps customers achieve a faster development, higher and lower cost across both advanced and mature process nodes. The key advantage is our technology platform include every first -- fast development since our technology can be implemented using a standard logic process. It does not require a major process change or modification to the existing device model. This helps significantly shorten the development and also adoption cycles. And the second is higher because the technology is fully compatible with a stand logic process and does not require complex special device or additional critical processes that it is easier to maintain higher and stable mass productions. And the third point is lower cost with a simpler process flow and the shorter cycle time and also higher overall wafer manufacturing and the system costs can be effectively reduced. On our 1T logic flash platform, the same core memory technology can support both embedded flash and also stand-alone flash. In fact, the core memory array design is quite similar between the embedded and also stand-alone flash. The main difference lies in the system interface for embedded flash. Interface is customized based on the requirement of each SoC system for stand-alone flash, the interface follows the industry standard in order to support our wide range of system platform and also end applications. Therefore, our 1T Memory platform can support both embedded and stand-alone flash and also has the potential to extend into both non-Flash and also NAND flash architectures. More importantly, because this technology can leverage existing logic processing capacity. It does not require customers or partners to build dedicated traditional flash production line or make larger-scale additional CapEx investment, and this gives the technology significant development potential and the strategic values, especially as the global flash supply chain evolves and also AI-related demand continues to grow. The potential applications are very broad including AI servers, Edge AI and smartphones and electrical vehicle, industrial control, networking equipment and various high security and also high-performance compute systems.

Traditional IP companies such as ARM, Rambus and [ Alpha Wave ] have been expanding into cheap products. Is eMemory moving into stand-alone memory similar. Could this become a future industry trend trials, please?

Okay. The companies mentioned mainly above, mainly IP design company. They typically develop IP product based on the existing process technology and the standard transistor architectures. And -- but the eMemory core competence however, lies in the invention of -- and the platformization of the memory technology itself. We are not only design IP. We evolve from the -- innovate from the underlying memory device process integration and the architecture label to build our complete technology platforms. As a result, in addition to developing and the sale of IP by ourselves, we can also license our core memory technology to other companies, allowing partners to further develop them into IPO and products. And from a business model perspective, we will continue to operate our IP business directly in order to maintain technology leadership and market influence. On the product side, we can enable more partners to participate in the productization and mass production through technology licensing. While eMemory collects a royalty based on the products shipments. Since the product licensing is closer to the end market in the value chain the potential royalty scale is typically much larger than our traditional IP licensing. This has always been an important growth direction for eMemory. We -- to evolve -- we focus on the -- evolve into a technology licensing company with strong core technology platform. and the broader influence across the product ecosystem.

What are the key drivers of revenue growth this year, Michael, please?

Revenue growth this year is driven by both upgrades of existing applications and the ramp-up of new applications. For existing applications, product upgrades have led to a higher royalty such as OLED DDI for affordable smartphone at 16-nanometer and the PMIC migration from 8-inch process to 55-nanometer. At the same time, several new applications are gradually entering mix production, including the smartphone or then-related chips, AICP BMC's embedded controllers, SSD controllers CSL controllers, [ TIM ] and high-speed networking interface applications. These new ramps are expected to further support the revenue growth.

As mature non foundries raised prices, while consumer smartphone demand remains weak. How does the company view the effectiveness and sustainability of this price increase, Joseph, please?

We believe the [indiscernible] price adjustments are supported by structural factors. First, leading foundries are allocating more resources to the most advanced process nodes and defense packaging. And this indirectly reduces the effect of capacity available for other mature nodes. And second, AI-related applications still require a significant amount of mature capacity, whether in data center, in Edge AI or in physical AI, many supporting components such as high-voltage and high-current power devices are still being manufactured on mature nodes. And I think a good example is the recent development of CPU architecture. In the CPU architecture, usually only the most critical components such as switch ASIC or DSPs, they adopt [indiscernible] 5-nano or 3-nano for maximum computing efficiency. But many surrounding optical analog and power-related components, they continue to use mature nodes to achieve the best balance of performance, power, area and cost. So we have also observed that some foundry customers are reallocating capacity and resources. For example, certain power-related businesses are being shifted to other foundry partners while more resources are being directly towards developing CPU relate processes.

With the continued advance of advanced nodes and growing demand for high-performance computing, are you seeing more adoption opportunity for your solutions on ARM-based platforms? And Charles, please?

As Edge AI CPUs move into mass production, demand for root of trust solution among advanced node CSS customers has increased significantly. And we have already seen multiple customers adopt related solutions.

Could you share the progress of the company's collaboration with Intel Foundry, Joseph, please?

Yes. Our collaboration with Intel foundry is mainly focused on even OTP and PUF-based security IP. We are actively working with Intel to bring our PUF-based IP on to Intel [indiscernible] to address the supply chain security requirements from the U.S. government and the related markets.

What is the potential from the ring module-related applications, which product lines would benefit the most? Joseph, please?

Yes. [indiscernible] module related applications represent an important growth opportunity for our OTP, MTP and security IP businesses. And this is mainly driven by AI servers, which are increasing demand for DDR5, CX memory, HBM and high stream memory modules. And these products require stronger yield management module configuration and security production. So for our OTP, the main application of repair and identification, such as memory repair. And for MTP, the main applications are updatable configuration and module management, such as SPD Hub and [ PMIC ] setting in DDR5 DIMs. And for security IP, the main applications are data security and a root of trust. And going forward, the DRAM module will no longer be viewed simply as memory component. They will become keynotes in AI servers in [ CX ] memory ports and in data center architectures. And therefore, as a result, the security requirement for DRAM.

As the company expands into more technologies, will this require significant R&D investment and lead to a sharp increase in operating expenses? Joseph, please?

Yes. So most of our technologies are built on years of accumulated know-how and our extensions of our existing core technology platforms. our technology are ultimately implemented by fund fees and chip customers. And under our business model, customers and partners, they pay licensing fees to help cover the cost of our R&D teams. And in addition, CapEx during the development process, such as test chips and related equipment are typically borne by customers entirely as well. And this has been our long-standing business model. It also reflects the trends of our core technology and the significant value our technology brings to the customers. Otherwise, this model will not be sustainable. So for the technologies, we are currently expanding into much of the core R&D and pattern development has already been completed. So going forward, the additional expenses will mainly come from execution-related R&D headcount. And as licensing projects increases, the related licensing revenue should also be sufficient to support the car R&D investment. Therefore, we do believe the OpEx will remain within a [indiscernible] range. Thank you.

What is the company progress in next-generation AI computing platforms such as the [indiscernible] platform? Joseph, please?

Yes. The [indiscernible] platform is the first computing generation to adopt [indiscernible], which was released by OCP back in March of '24. And this is also the first specification to include OTP and into the design requirements. And based on this specification, our technologies have started to be adopted in CPUs and BMCs in SSD controllers, CXO controllers and other networking-related trips. So more importantly, OCP specifications are not limited to [ vararubin ] Architecture itself. They are also applicable to other cloud service providers to telecom operators to large enterprises building their own private cloud data centers. And after that, OCP further released Collibra.0, which includes PC as well as the foundation chiplet system architecture, which was mentioned by our Chairman in the beginning of this earnings call. And that clearly requires a higher root of trust in their standards as well. And this reflects the market's growing need for a unified hardware security architecture and persistent data management. And under this trend, functions such as ship repair, data storage and how we trust are gradually being adopted across different computing components, and we believe moving forward towards a more consistent architecture. And as each new generation of AI platform evolves, we do expect our penetration in AI-related applications to continue to expand over time.

As the company expands its security business towards system-level solutions, what would the business model look like? Who are the potential customers? Joseph, please?

Yes. in the development of our hardware security systems, our core strategy has 2 main directions. First, we are using PUF as the core foundational technology to develop our next-generation hardware security modules, which we call the HSM. And second, we plan to use HSM as a security platform to further develop security-as-a-service related applications and services. And through this architecture, customers will be able to build hardware security systems with a high level of security and trust. And these systems can protect not only the operation of devices and systems themselves. But also broader application layer security needs, including things like AI, like communication, data protection, identity, authentication and cloud services. And in terms of business model, eMemory will continue to focus on technology licensing. We plan to license the HSM platform and related security technologies to OEMs and to system companies for productization and mass production. And we'll be collecting royalties based on the end product sales. Potential customers include telecom operators, our security equipment providers or Edge AI OEMs, industrial PC, AI infrastructure providers and various AI and cloud system operators that will be having a growing demand for the [indiscernible] and higher root of trust. Thank you.

In the interest of time, we will begin the last questions. What is the company's progress in system-level hardware security? How should we think about future HSM or security as a service opportunities? Joseph, please?

Yes. Okay. So the company's development in hardware security is gradually expanding from our existing IP licensing business into a system-level security solution. Overall, we can look at the architecture in 3 layers. First, the HSM core computing layer at the bottom, the key and certificate management layer in the middle and the application service layer on the top. At the HSM core computing layer, we are using PUF technology as the foundation for higher root of trust. And based on this foundation, we are developing different types of HSM products to support personal devices, compliance needs for SMBs and high-end network HSM applications. And going forward, these products will further integrate [indiscernible] and PUF technologies with the goal of meeting international cybersecurity certification standards and requirements and this will help strengthen the product ratability and market acceptance in high-security applications. And at the key and certificate management layer, we are also working with external certificate and PKI ecosystem partners. The goal is to integrate our underlying hardware security capabilities, certificate management systems and provide a more complete HSM plus PKI solution. This will help customers adopt how we're based security architecture more efficiently for applications like identity authentication, key management, digital signatures and system trust management. And lastly, at the application service layer, we have completed the development of our Signing-as-a-Service platform. In the future, this platform can support applications such as digital signature such as device identity, trusted data verification and DID wallets. And this means the company can not only provide how are security IP, but also has the opportunity and capability to participate in the Security as a Service business model. And to conclude the things, overall, the HSM Security as a Service represents an important direction for the company as we expand from an IP provider into a system-level security solution provider. And in the near term, our focus remains on technology integration and application validation. And over the medium and long term, we see the opportunities to build new business models and growth drivers through our HSM platform licensing through PKI integration solutions and upper layer security services.

And we will begin the closing comments. Charles, please proceed.

Thank you once again for your patience and the support for eMemory. We will continue to work on technology and IP innovation. And the PUF-based hardware security solution for our customers and also bring a higher return for our shareholders. Thank you.

Thank you, ladies and gentlemen. Please be advised that the conference recording will be accessible within the next 3 hours. Thank you, everyone, for joining us today. We hope you will join us again next quarter. You may now disconnect. Goodbye, and have a good day.