Soitec SA (SOI) Earnings Call Transcript & Summary

All right. Let's get started. Hello, everyone. I'm Steve Babureck, SVP, Strategy and Investor Relations for Soitec. Welcome to Soitec 2023 Capital Markets Day. Pleasure to have you here in Paris here with all of us. Thank you for those on the webcast. They are also tuned in. Before we begin and present the agenda, let me just show you the disclaimer. Okay. So we have a busy afternoon here in Paris ahead of us. We're going to be together for the next 3 hours. As usual, we will start first with the CEO vision, then we will discuss strategy, innovation. We will then go over the 3 divisions: Mobile communications, automotive and industrial, smart devices. We will then have our first Q&A session, short break, and then we will resume with a presentation on operations, finance and then our second Q&A. So a busy agenda. And so let's get started immediately. It's my pleasure to introduce Pierre Barnabe, Chief Executive Officer of Soitec. Pierre?

Thank you, Steve. Thank you very much. Good afternoon to all of you in Paris, and good morning and good evening for the one connected online. Thank you, first of all, for attending this Capital Market Day event of Soitec. After more than a year with Soitec, I am glad to be in front of you today. I already had the opportunity to meet with most of you, and it is always a pleasure to meet with you again. I would like to thank, first the top executives of some of our biggest customers for their testimonials. Tom Caulfield, Chief Executive Officer, GlobalFoundries; Jean-Marc Chery, President, Chief Executive Officer, STMicroelectronics; and Gibong Jeong, EVP, Business Development at Samsung Foundries. Today is a good day to remind you that we are on track on our fiscal year '26 road map. It is also a fantastic opportunity for me to share my vision to expand our sustainable value creation towards 2030. So let's get started. Let me start with some important messages. Technology megatrends sustained massive demand for semiconductors and drives the increasing adoption of engineered substrates. Investing in our innovation and our operations, allows us to expand our footprint and our leadership in engineered substrates. And finally, we are on track with our fiscal year '26 objectives. We will double our EBITDA in the coming 3 years. Beyond fiscal year '26, we have a strong ambition of sustainable and profitable growth. So let's start with the technology megatrends, which fuel massive demand for semiconductors and higher adoption of engineered substrates. Over the last 30 years, the semiconductor market has experienced a very solid growth, sustaining the diverse technology revolutions: analog, digital, wide, wireless across multiple standouts and technologies. Today's market is facing challenges. I consider them as opportunities for Soitec. First and foremost, macro volatility. We manage our business and strictly monitor our global context. In a challenging environment, we delivered fiscal year '23 on our commitment with a 19% revenue growth. This year, we expect to maintain our revenue stable and our EBITDA margin at around 36%. Second, global tensions. We are a global geography-agnostic company and building critical components for multiple end markets. We navigate the global tensions to balance needs and demands. And finally, environmental challenges. Our range of products are a response to climate change. Our Smart Cut technology makes our products more efficient in terms of energy consumption. The more Soitec, the more energy efficiency. More than ever, the search for sustainability will be at stake in the context of the tremendous growth expected in the coming 7 years. The semiconductor industry will reach $1 trillion by 2030, sustaining a 7% annualized growth. This growth will be fueled by the increasing needs for more applications around artificial intelligence, virtual reality, autonomous and electrical vehicle, 5G, computing or Industry 4.0. More devices, more components, improved form factor, less energy. Soitec is a simple and clear answer for customers. Soitec products are a critical element in the semiconductor value chain. By design, our engineered substrates are unique products that deliver superior device and system benefits. Over the last 3 decades, we have developed an expanding toolbox to assemble any types of materials and make them smarter and more efficient. Such a set of technologies enhances the dice, the chips, the boards towards more active applications across 3 markets today: wireless communication, Automotive and Industrial, smart devices. We leverage our unique expertise to bring tremendous differentiation to the end products and applications. Talking about product portfolio. We are still developing a comprehensive range of silicon on insulator solutions. For RF and FD, we are an undisputed standard. We have also developed solutions around Power-SOI, Imager-SOI and Photonics that is particularly promising. We continue to invest in R&D to strengthen and expand our SOI leadership. On these solid foundations, we have decided to develop specific compounds, products and diverse -- for diverse applications. POI for filter products, SmartSiC in the powertrain to enable the electrification of the vehicles, RF, gallium nitride, so the next frontier for very high frequency applications and later on, pro-GaN for very high voltages. Beyond these strong assets, we see clearer and further. The use of Smart Cut for GaN will disrupt the market as well as tiling for InP. We have a strong ambition to expand our leadership and become a standard on new engineered substrates and product materials. Of course, we are going to continue monetizing and valuing our patents and IP portfolio to make our technologies a standard. All in all, we intend to multiply by 3 addressable market. We leverage those 3 key elements I just described. The doubling of the semiconductor market. The increased adoption of engineered substrates that is the only solution towards technological and environmental challenges and our ambitious expansion of products and technologies in the coming years. Let's discuss the unique sustainability value creation model we deploy to leverage these powerful megatrends now. Soitec is a very fast-growing company, outstanding in innovation and excellent in terms of operations. With 4,000 active patents and more than 10% of our revenue invested in R&D and 8 manufacturing units direct or through partnership, we have the right assets and investment level to foster our ambitions. This is not a fixed and definitive picture if we want to continue developing our wind span. More than ever, we are contemplating the possibilities to expand in terms of geographies [indiscernible]. Beyond our excellence in innovation and operations to serve our divisions, our business model will be more than ever reinforced. Better knowing the end user and OEM and understanding their in-depth needs in terms of technical features and sustainability constraints is one of our secret source. This gives us more credibility to engage long-term future-proof conversations with foundries, fabless and IDM. As we engage with fabless at the technology level, we can better anticipate semiconductor architectures. We collaborate to better design and offer the type of engineered substrates they will require to deliver the best performance at the device level. From the historical smartphone value chain we address end-to-end, we have established a clear path towards the automotive sector, industrial world as well as data center and smart devices markets. These are new frontiers, for which we are hiring experts to help Soitec in this transformation. Our operating model stands for reason. Soitec is able to invent at the edge of the physics and to produce massively in quality and competitiveness. This is the perpetual engine of the group, innovation and operations fueling each other from lab to pilot lines, all the way to our fabs. It aims at providing the best-in-class products for the divisions, mobile, automotive and devices. The division are selling aided value, transformation and innovative features into the entire value chain. Ultimately, this value creation benefits all our stakeholders, employees, shareholders, suppliers, communities and of course, our planet. To serve this strategy and to execute this powerful model, I am very pleased and proud to work with an incredible team of ambitious, dedicated, seasoned and diverse leaders. We continue to develop our talents with internal promotions, while we leverage our ability to attract the best in their respective fields. This organization reflects the needs for simplicity, clarity, speed of execution and transformation with innovation and operation at the core engine and the division at the business enablers. ESG matters a lot to Soitec and particularly to me. Regarding sustainability, we are, by design, actively contributing to reduce carbon footprint across the product life cycle. By cutting 10x a donor to provide a very thin active layer, we drive energy savings across the semiconductor value chain. Our products are sustainable, but our group takes its part. We are reducing our carbon emission by 25% in absolute value between 2020 and 2025. Water consumption is also at the top of the list. We are committed to deploying clear actions to halve the water intake per unit by 2030. And that is a very important topic of people. I met almost every employees at Soitec and have been impressed by their expertise, commitment and share values. This is a company with a fantastic mindset. Soitec is a technology standard, but we also want to become a reference and an inspiring company. We target 40% of women in our top management as well as across the whole group by 2030. Selectively promoting 1 employee out of 5 every year will help us to reach this target. 100% of our employees are getting free shares, which is unique in this industry. We monitor ESG performance across the group. I'm the first to be accountable to our ESG objectives and practices. We also monitor our performance at the new ESG committee at the Board level, where around 60% of our directors are independent. Now -- let's talk about key figures now and the concrete illustration of our ambitious plan. After a stable year of fiscal year '24 due to smartphone market decline, compensated by the increasing adoption of FD-SOI and an acceleration on POI and growing automotive and smart devices segments, we forecast around $2.1 billion revenue in fiscal year '26. Our acceleration will be fueled by our POI filters product in mobile, SmartSiC takeoff, the massive adoption of FD-SOI in Photonics and the acceleration and continuous growth of automotive and industrial as well as smart devices. 3 years from now, these 2 emerging divisions will weight close to $0.5 billion each. Regarding profitability, we are going to maintain around 36% EBITDA margin in line with fiscal year '23 and will build up to around 40% by fiscal year '26, thanks to added value products and features to sustain strong pricing dynamics, operational excellence and operating leverage and cost control. We plan to deliver a significant improvement on the EBITDA performance, while continuing to invest more than 10% of our revenue in R&D to prepare our future. This ambitious value creation requires to keep an intense program of CapEx in our 300 millimeter capabilities in SOI for expansion and refresh, in our next product generation, POI, silicon carbide, gallium nitride, in 150 millimeter and 200 millimeter, but also in innovation and sustainability according to our strong determination to be a standard and a reference in our market. So we need to invest. We also continue to optimize our cash management. It gives us freedom to be opportunistic for -- in our expansion strategy. On top of a solid net cash position, our profitable and sustainable accruals will continue to feed our free cash flow, lower CapEx on sales ratio and improve the return on capital employed in the [ mid-2020s ] by fiscal year '26. We see clear and further, and the technological and human potential of the group is very promising. Beyond fiscal year '26, leveraging our strong assets and our universal positioning, we intend to continue increasing our market share, developing new strategic partnerships in fast-growing domains and monetizing our IP toolbox. We will expand our product portfolio, thanks to organic innovation and bolt-on acquisition, to reinforce and expand our leadership. We aim at being a standard and an example to follow in terms of genuine sustainability capacity and enlarging our global footprint. As I said, beyond fiscal year '26, we want to expand, and we have the means to expand. It is now my great pleasure to hand over to Steve Babureck, our SVP, Strategy. Steve, welcome to stage.

Thank you very much, Pierre. So now let's talk about strategy, and let's focus on the first part of Pierre presentation and the 3 engines of growth. In our Capital Markets Day, we love to talk about growth, which is a very important part of our long-term strategy. Soitec equity story is a growth story, sustainable and profitable growth story. And this story starts with the megatrends. So first key message. 5G, AI, energy efficiency, they're not new, of course. We've been talking about them for quite a bit of time. But I think they're becoming more important to all of us. These 3 megatrends will sustain a massive demand for semiconductor chips. Megatrends because behind the term, there are very large ecosystems with very large technology companies, a lot of investments, a lot of innovation in semiconductors, complex supply chains, manufacturing and infrastructure. We also call them mega trends because they're supposed to change the world. Changing the world takes time, so they're going to probably be with us for quite a bit of time. This is good news for the semiconductor industry. This is good news for Soitec. More applications will need better semiconductors and that brings me to the second message, better semiconductors will also require an increasing number of engineer substrate, the foundation of many semiconductor chips. So third message, what does it mean for Soitec. Engineered substrate is our core business. We are the market leader in silicon on insulators. We are expanding aggressively in compound semiconductors and into new engineered substrates, new technologies. And we will discuss the numbers, but we believe that with the growth coming from the semiconductor sector, the growth from engineered substrates, our capability to innovate and expand our footprint, we should be able to triple our addressable market by 2030. So let's go back to the megatrends and clearly, 3 slides to talk about 3 giant megatrends. It's going to be a challenge. So we used our human intelligence to select a few key messages that matter to us. Let's start with 5G. 5G is a mobile communication revolution. It is a major upgrade in terms of data speed, in terms of network capacity, latency, reliability and the ability to deploy a massive number of Internet of Things devices. To support this important growth in data communications, data traffic between humans, human and machines, machines, 5G is steadily being deployed across the world, across multiple geographies. And on the device last year, over 50% of the smartphones were already equipped with 5G. This penetration of 5G within smartphones will continue to raise steadily to 80%, 90% in the next few years. So 5G is being deployed and yet -- we have not seen yet the full potential of 5G. That should happen more and more in the next few years with a larger impact of 5G. 5G will be more deployed in the networks, of course, in the installed base of smartphones, of smart devices, in various places, universities, schools, hospitals, factories, road infrastructure. And at that point, the number of transformational use cases for 5G is likely to increase significantly. Autonomous driving, remote surgery, augmented and virtual reality, just to name a few examples. On the technology side, 5G has also triggered the development of new advanced semiconductor chips, especially on the connectivity side, on the cellular side. Chips that could bring better performance, better connectivity with lower power consumption and all of this at a reasonable cost. 5G is only the latest cellular generation, but 6G is already under preparation. And we're already working with -- on 6G with some of our partners. So you should expect that new chips, new materials related to 6G will be on the market before the end of this next decade. Second megatrend, AI. So artificial intelligence, of course, the topic is even more challenging to discuss in one slide. It's a lot of hype, as you know. And it's been on our radar for quite a bit of time at Soitec. There are probably a few important things that are happening with AI right now. First of all, technology. We're probably seeing an inflection point on the technology side due to the exponential increase in computing power. We used to have the Moore's Law to sustain innovation in computing power. Moore's Law is still here. But on top of this, we have a quite significant development in algorithms. AI is getting more powerful and AI is also being deployed more massively all around us in the cloud, in the data centers with thousands and thousands of servers, what we call hyperscale data centers. But AI is also being deployed at the edge, what we call edge AI or edge computing. It means that we now have AI for smartphones, smart devices, various sensors, and also new environments, cars, factories, cities, transportation networks. Also, back to 5G, AI is able to leverage the massive amount of data that 5G provides through the networks and other devices. So also going forward, we should expect more use cases for AI to be quite impactful. Think about health care, diagnostic, product design development, digital creation, autonomous driving and so on. Last point about AI, a great impact on semiconductors. When it comes to semiconductors innovation, AI is a huge market for both infrastructure and devices. A lot of innovation, whether it's about processing, very high-performance chips like microprocessor or graphic processors in the cloud, but also innovation for processing units at the edge, where chips are able to consume very little to non electricity. Innovation in memories to store all the data in the cloud and special memories at the edge. Innovation for optical components, think about image sensors, but also optical transceivers to accelerate data speed in the service. And last but not least, innovation for power electronics, because data centers consume a lot of electricity and there must be -- there's a need for energy-efficient solutions. So 5G and AI, they feed each other, kind of overlap, they benefit from the same type of semiconductor innovation, that's the good news, right? The bad news is that they also amplify a major global issue, which is energy consumption. So that brings me to the third megatrends, which is related to energy efficiency. The rising demand of electricity comes from industrial activities, buildings, consumer electronics. And there are some new drivers for electricity, which is related to the road electrification, electric vehicles, electric infrastructure for the charges. So the current demand for electricity globally does not seem quite sustainable unless we have major upgrade on the grid, but also, we must find more energy-efficient solutions in the telecommunication networks, in industrial facilities and at the consumer electronic device level. So what does it mean for semiconductors? Energy efficiency is also a formidable driver of innovation for semiconductors and also for engineered substrates. So we'll hear -- we'll talk a lot today about some SOI product, but also silicon carbide, gallium nitride, new engineered substrates to enable energy-efficient solutions. And when we think about the electronic solution, we need to think about the entire supply chain from raw materials to substrate, to device all the way to the system when you think about the carbon footprint and the energy equation. So 5G, artificial intelligence, energy efficiency, these 3 megatrends coexist and they will drive this massive demand of semiconductors and a major semiconductor content increase in multiple verticals and applications. So let's look at a few examples starting with the smartphones. Smartphones, the content increase has started in the middle of 4G. It has continued. In 5G, it will continue for years to come. We will have smartphones with better 5G connectivity chips, more imaging and sensors and of course, more processing power to compute with all the apps and the connectivity features. Same story is automotive, similar trend. Automotive has several areas of innovation, autonomous driving and safety, which drives the demand for new components. Connectivity, connectivity within the car, connectivity between the car and the other cars or the road infrastructure or the smart city. And of course, a lot of innovation and content increase related to powertrain as the car is going electric. Third vertical, smart devices. So we were going to talk about wearables, hearables and other smart watches, but I'm sure you've seen the latest announcement from Apple with the Vision Pro. This is the type of new electronic device that fits the smart devices, example. New device, it could be a great commercial success. You could see competition coming after. But at the end of the day, it's a new electronic device with more connectivity, more sensors, more computing power, more semiconductors overall, and new semiconductors. Going into data centers. This is another area where we must have a significant semiconductor content increase to fulfill all the applications of data centers in terms of AI processing. But also, as I mentioned earlier, connectivity also, if you think about Ethernet switches, optical transceivers to increase data speed. And of course, power electronics to optimize the power consumption of the data center. So megatrend will fuel massive demand for semiconductors, new semiconductors, better semiconductors. The question now is what does that mean for the engineered substrates, for the materials part of the supply chain? More semiconductors, better semiconductors mean that more and more of these chips will require the use of engineered substrates. Engineered substrate in a nutshell at the system level, they bring better performance, lower power consumption, improved integration and overall lower cost of ownership. So looking at the status of the market today. If you think about the entire semiconductor industry, the industry today consumes around 240 million substrates per year. You can see on the left side of the chart, most of it, 90% of it is bulk silicon. A small fraction of this global substrate market is what we call engineered substrate. So engineered substrate, SOI, POI, SiC, GaN and other engineers substrates. You can see the main difference graphically. A bulk substrate is a simple bulk substrate. An engineered substrate contains a bulk substrate, which could be bulk silicon and multiple additional layers on top of it, functional layer, additional layer. We specifically designed the engineered substrate for specific applications, specific devices, specific markets. That portion of the engineered substrate, which was estimated at around 15 million wafers last year, so around 6% penetration, that 15 million wafers will grow dramatically in the next few years. My colleagues will cover extensively the link between the engineered substrates structure and the benefits at the system level. But for mobile, engineered substrate -- the reason why we use engineered substrate today, the reason why we will use more and more engineered substrates tomorrow is because basically engineered substrates, if you think about RF-SOI, can deliver 5G, can deliver this better connectivity everywhere. They can deliver longer battery lifetime, so overall, a better user experience. In automotive, engineered substrate can bring the safety, can bring the autonomous driving capabilities, think about FD-SOI. And of course, they are a must go product for the electrification of the powertrain, of course, with silicon carbide. And now in terms of smart devices, as we define it in our division, there's various attributes to engineered substrates, whether it's to enable ultra-low power consumption for edge AI, FD-SOI or, for example, to bring silicon photonics and optical transceivers for data centers. So back to the numbers and what we expect between now and 2030. The total number of wafers is going to grow from 240 million wafers today to 340 million wafers by 2030. This is the overall semiconductor industry. And that's roughly a 7% CAGR in line with what Pierre was mentioning for the total semiconductor industry, reaching $1 trillion by 2030. Now within that overall global substrate market, engineered substrate is going to grow from 15 million roughly to around 30 million by 2030. So the overall engineered substrate market is expected to double by 2030. And within the engineered substrate market, Soitec addressable market, we estimated it at around 5 million wafers last year, we estimate that it should grow up to 15 million wafers by 2030. So our addressable market for Soitec is going to triple by 2030. How are we going to get there? First of all, as I said earlier, Soitec is the #1 market player in SOI, which is the largest category of engineered substrates. We must continue to strengthen, consolidate this leadership in SOI. We're #1 in revenues. We have, by far, the largest innovation capabilities, manufacturing capabilities and strategic relationships between suppliers and customers, and customers' customers, if you go all the way to the fabless, across the 3 end markets: mobile, Automotive and Industrial, smart devices. So we will continue to expand that leadership in SOI, which is a growing market for the next years to come, and the 3 divisions will cover this. The second objective is what we've already outlined in our fiscal '26 objectives is to continue the expansion into compound semiconductors. In that part of the market, we're leveraging our Smart Cut technology, think about POI, think about SmartSiC. We're also leveraging our intimacy with the ecosystem. Most of this growth is organic, but we've also made a couple of bolt-on acquisitions to strengthen our product portfolio or accelerate our development. Think about frequencies, for IP in filters for POI -- support POI, NOVASIC to accelerate the SmartSiC development. And of course, EpiGaN to enter the epiwafer gallium nitride market a few years ago. So bolt-on M&A is also part of our growth strategy when it comes to expanding our product and technology portfolio. Last, if you think about fiscal '26 and beyond, we will continue and we will continue to invest in new materials, new substrates, new technologies across our 3 end markets and also to enter new markets. There's absolutely no limit today when we look at the technology road maps for each of the markets to not penetrate them through engineered substrates. Strategic partnerships will also be important. We see more and more vertical integration in the semiconductor supply chain. So we need to have the right partnership both on the supply side and on the customer side. So in terms of end markets, as I said, no limit. We have plans, health care, memories, quantum computing. We will talk more in the next presentations about where we could go. So to wrap this strategy presentation, 3 key messages: First of all, the technology megatrends, very important to be positioned on markets -- end markets that are growing and fueling innovation for semiconductors and engineered substrate. Number two, engineered substrates will penetrate further the entire substrate market because they bring unique benefits at the system level. Number three, we will triple our addressable market through more innovation, more product development, more strategic partnerships. With that, I would like now to introduce the next topic. The next topic is innovation. Innovation and strategy are good friends at Soitec. We spent a lot of time discussing long-term trends for 2030 and beyond. So it is my pleasure to introduce Soitec Chief Technology Officer, Christophe Maleville.

Thank you so much, Steve, for this warm introduction. And hello, everyone, and thank you very much for attending our Capital Market Day. Today, I'd like to share with you my vision of innovation at Soitec. But before covering my key messages, let me first bring you back 30 years ago. We were just starting Soitec with one groundbreaking process and one application in target. While coming back today, fast forward, we've adapted it to multiple semiconducting materials, opening up the field of possibilities to device makers. Innovation is at the heart of our value creation model. It's a key growth enabler. There are 3 messages I'd like you to remember from my presentation. We leverage material science to deliver value at the system level. Expanding our technology portfolio is fundamental to bring compelling product to market, and speed is of the essence, and so are our strategic partnerships in the race to intersect market opportunities and gain market share. So I've been working in Soitec technologies for over 30 years from pretty much all possible angles, innovation, product, business, sales. Our funnel has never been storage. One key learning innovation is the engine to gain competitive advantage to have a positive impact on the industry and to drive changes in the semiconductor world. Going further, we have clear drivers for our innovation in order to enable technology to high-volume manufacturing paths and for a wide range of applications. At all stage of our product life cycle, our teams must keep in mind our drivers, on-time maturity, with enhanced performance, energy efficiency, reduced small form factor at the right cost and in a sustainable way. How do we proceed then? First of all, we work closely with the end users to understand their challenges. Then we take the best out of each single layer of material to address those challenges and combine them into one compelling solution, one engineered substrate. This way, we create unique value at the system level. But to make it clearer, let me illustrate with a couple of examples. In facial recognition domain, we've leveraged our know-how in layer transfer to fine-tune layer thicknesses, to maximize signal-to-noise ratio and fit with customer design solution and created a new SOI substrate directly embedded in the end user camera. Another example, with RF applications, increasing the data rate is key. In other words, we need systems capable of working at higher frequencies with lower losses. To do so, we've replaced bulk silicon and [ 35 ] compounds with an innovative combination of layers, allowing for better confinement of electrons and improved RF isolation. That's our RF SOI, a product which is now in 100% of 5G smartphones. Performance is great. Sustainable performance is essential. By design, our products are at the heart of energy efficiency. From the beginning of our innovation process, we minimize energy consumption across the value chain in our fabs to manufacture our semiconductor materials and beyond our fabs, with Soitec customers using higher performance and energy efficiency products. Three numbers to capture our positive impact on the industry. 25% energy savings enabled by the new generation of RF-SOI for 4G and 5G smartphones, 10% additional battery range allowed by SmartSiC for electric vehicles and a massive saving on CO2 emission and 40% saving achieved by wearables based on our FD-SOI substrates in standby mode. Let me now show you our DNA base. This table displays our ability to combine different materials to create differentiating substrates. These are all combination we've demonstrated. We have on the X axis the best active layer and the Y axis, the range of functional substrate we have used so far. This is a synthetic view of the versatility of our Smart Cut we accumulated along the years, and this is a major asset we have in the bank. Behind each of these wafers, there's all process recipes, a solution to adapt materials, know-how and IP to combine all kind of layers. Having demonstrated all of this allows us to innovate faster, better, and bring unique credit value engineered materials to market. Now something new in this table since last -- we spoke last time, polysilicon carbide. Polysilicon carbide demonstrates we are going one step further with a new capability to create new starting substrates serving our targets. We created a new substrate driving value at significant cost reduction that is essential to accelerate the transition for electric vehicles. But why we're doing all of this? Well, to go beyond silicon. Today, we need more sustainable compounds with higher performance. That's SmartSiC for electric vehicles, but also to bring new materials, crystalline layers into the silicon world by combining any kind of substrates such as indium phosphide on anything, pushing the limits for RF, imaging or photonics and also to accelerate breaking some systematic limits by scaling up to 300 millimeter, that's styling indium phosphide for cost-effective usage of InP. To complete this part of our road map, what's next? Next is going beyond engineered substrates. In the future, you could imagine Smart Cut to be used as a module directly within the fab. With the ever-increasing number of integrated functions per chip, 3D layer stacking offers the opportunity to do it all on the same handle wafer, yet using the best layer for its function, and that's our core business. In this section, I'd like to give you some elements to show our ever-growing innovation capabilities. Smart Cut is, of course, the pillar of our portfolio but we completed it with many more decisive capabilities. Epitaxy of silicon and [indiscernible] (52:27) materials, process layer transfer, materials expertise, surface and interface engineering, wafer reuse, advanced process steps, significantly developed with our acquisition of NOVASiC. Mastering these technologies is essential to create leading engineered substrates. Let me pause for a moment on our Smart Cut process as it embodies the essence of our innovation approach. We have reached a maturity allowing us a generic approach for engineered substrate creation. We consider a target application, identify the best active material, transfer a thin layer of it onto a functional substrate and create unique capabilities and greater performance. We opened new possibilities, a new dimension for semiconductor material design. Smart Cut enables the combination of material, which cannot grow on top of each other. Smart Cut goes beyond the limitation of the substrate characteristics, pushes the boundaries of any growth or deposition technique and allow the transfer of the best layer for a target application and a functional substrate and at the end to create a cutting-edge solution. These still look great on paper. What matters is our ability to use them to bring compelling products to the market and SmartSiC is our latest example. SmartSiC is a new and unrivaled generation of SiC wafers, which leverages the combination of a thin layer of MonoSiC and ultra-high conductivity handler of PolySiC. SmartSiC enables high conductivity substrates and benefits power devices such as Diodes and MOSFETs. SmartSiC brings many advantages over bulk SiC. It is greener, faster and better. Greener, as it saves 40,000 tonnes of CO2 for each million wafer produce. Faster, by accelerating silicon carbide adoption in 200-millimeter with more than 10 times mono silicon carbide wafer reusability, and better, thanks to the improvement of device resistivity of up to 20% improvement of yield and performance in manufacturing. In other words, SmartSiC gathers the best of both worlds by combining the performance of monosilicon carbide and the high conductivity of polysilicon carbide. Every 2 years at our Capital Market Day, we like to come up with a surprise. This year, let me introduce you SmartGaN. The same way we created smart silicon carbide to extract the best of silicon carbide material, our ambition is to accelerate benefits of GaN for market. Here, our Smart Cut process allows our customers to completely get rid of the costly and performance limiting buffer layer. For RF, this directly translates into significant cost savings and smaller form factor. For power, it allows for a thicker gallium nitride epi stack to be grown on top of the GaN seed layer without risking wafer breakage during cool down. SmartGaN, therefore, opens the door to voltage over 1,200 volt as required for high-power devices. All these developments are only possible, thanks to our innovation model. Innovation model, which lies essentially in a smart management of short-term and long-term R&D, strategic partnership, speed, speed and speed, and of course, our people. Coming back to my first point, we are globally driving at 80%, 20% baseline. 80% to support our 5-year business plan and deliver next-generation products, 20% to address the challenges our industry will face beyond these 5 years to guarantee Soitec positioning at the forefront and enable our market expansion, our market share expansion. Second key pillar, our strategic collaborations. They are the engine to better understand the market needs and validate our solutions, accelerate innovation as well as time to market and enable the delivery of high-quality prototype in record time. And also anticipate [ tool of record definition ] as well as recipes. Our SmartSiC pilot line, implemented within the Leti facilities is a great example of it. The substrate innovation centers gave us access to key players all across the value chain from leading equipment suppliers to renowned academics and cutting-edge device manufacturers. Again, this hub was a fundamental base for our SmartSiC deployment. Beyond the Leti, our collaboration of no border. Today, we're strengthening our European footprint, and we have a rich ecosystem with academics and LTO leaders. We are joining programs at the forefront of the semiconductor industry. Going forward, we will continue to leverage this partnership and probably expand in Asia and in the U.S. Let me move on to the third pillar of our innovation model. Speed, in our industry, speed is of the essence. It defines our ability to intercept opportunities and gain market share. We must run fast, faster than the others, which guarantees success of our business model, leading deployment of new standards with large player. Speed played a pivotal role in our success to deliver SmartSiC in less than 4 years, including most advanced device right first time validation. Finally, at the roots of Soitec innovation system are its people. Inventors and experts will sustain our growth ambition beyond fiscal year '26. They will leverage efficient processes, a strong and expanding innovation toolbox as well as strategic collaboration all across the semiconductor ecosystem. This is our model and its course to gain competitive advantage in always expanding domains. Well, thank you for your attention. Now I'm very pleased to welcome Jean-Marc, Jean-Marc Le Meil with whom I shared many Smart Cut adventure, Jean-Marc, the floor is yours.

Thank you, Christophe for developing a Smart Cut-based technology supporting our innovative product map. So good morning, good afternoon, all of you. I'm Jean-Marc Le Meil. I'm the Head of Mobile Communications division. And I've been working with Soitec for more than 20 years on different management positions from product engineering to general managers of the RF-SOI business units and in close collaboration with all our customers. I'm now consolidating 4 product lines. The Connect RF-SOI, the Connected FD-SOI, the Connect POI for filters as well as the new Connect RF-GaN. And today, I'm proud to present all the great opportunities ahead of us for the divisions that I did. Let's turn to our mobile communication business plan for the next 2 years. Our growth is all about 5G. 5G and its global penetration which will drive Soitec Mobile Communication Division growth. 4 drivers will help us size the full potential of Soitec Mobile Communication division. First, 5G Sub-6GHz, which remains to date our main business driver with 5G phones growing at a 15% CAGR. Second, the 5G mmWave adoption, which is still growing fast, at a 15% CAGR and it's already been adopted in dense areas. And we're also increasing our footprint, thanks to the also WiFi 6, 6E & 7 new generations. And last but not least, 5G and WiFi infrastructure rely on all regions, would continue to deploy it. Soitec mobile division will grow at a CAGR of about 20%. We do planning to grow by 1.7x and to reach EUR 1.3 billion due by FY '26. But 5G is not only about smartphones. 5G is pervasive well beyond smartphones. We have already seen new use cases such as extended reality, smart transportation and many others. For instance, the new 5G Advanced, Release-18 will enable the massive adoption of connected objects and of fixed WiFi access to [indiscernible]. 5G is transforming the world of smartphones and beyond. The 4G road map was the initial driver for RF-SOI. Looking forward, we are looking to a counter blip brought by 5G, with 100x network capacity, 10x more speed, response times and energy saving per data, and today, in 2023, 5G Advanced, we're entering the second wave of 5G innovations, which are game changer. 5G Advanced will result in a greater quantity of connected objects together with WiFi 6 access. Allow me to explain on the 5G X-factor. In the current decade, data traffic will be multiplied by 10. As a consequence, the RF front-end module market will more than triple to EUR 45 billion by 2030. So growth will boost the increased requirement for engineered substrates, especially for device like power amplifier, low-noise amplifiers, switches, tuners, filters, and to address the new millimeter wave bands with [indiscernible]. One more word on millimeter waves. Millimeter waves is expanding the boundaries of 5G to address the exponential growth of the data traffic. As you can see, for example, on this network capacity trend chart in U.S., showing the saturation of 5G Sub-6GHz in the coming years. Millimeter wave will provide high data rates and the lowest latency. Today, this particularly fits with crowded areas with the last-mile to own where fiber hasn't been deployed, but also to a large range of new applications, such as AR/VR everywhere, smart factories and other private network. Beyond smartphones, the connectivity market is driven by 3 trends: so next, WiFi generation, 6E & 7, we'll see its market value multiplied by 3 by 2030. So fixed-wireless access market will deliver 5G to [indiscernible] which will be multiplied by 8 by 2030. And the last driver is the adoption of 5G Advanced to enable the proliferation of connected objects everywhere. To address this, we have a comprehensive product portfolio with Connect RF-SOI, FD-SOI, POI for filters and RF-GaN. We bring value to all the figure of merits required by the front-end modules as our technology fits 4G, 5G millimeter wave, WiFi and ultra-high wave band. Taking an example of RF-SOI, which is the standard today for 4G, and obviously, will remain the startup for 5G and WiFi for different components like switches, low-noise amplifiers and antenna tuners. But also FD-SOI solutions across millimeter wave [indiscernible] is progressing very well. POI after some delay in qualification, POI wafer is now adopted for 5G bands to integrate multiplexers and is ramping fast into our installed capacity. Opportunities of market recognize the value of RF-GaN which offer power amplifier with better power efficiency. A few words about the content growth opportunity, which is our story. The high-end premium smartphones is our strongest market. Today, in 2023, the total opportunity is in the range of 100 square millimeter for smartphones. It is again expected to more than double by FY '26 with 5G growing in new bands like Sub-7GHz millimeter wave. RF-SOI will remain the standard, POI for filter, which presents a very significant opportunity for 5G mid-high bands and low bands. 5G millimeter wave will continue to develop based on the RF-SOI or FD-SOI. For RF front-end IC providing more integration. On top of this, WiFi 6, 6E & 7 and ultra-high band will also contribute to much higher content opportunity. Let me now comment on the different road maps of our products, starting with RF-SOI. There is no 5G without RF-SOI. RF-SOI is the industry standard. We are developing high-end as well as low-end solutions. Especially low-end solutions to feed the upcoming 5G IoT growth with a dedicated product, as you can see on the bottom left of this chart. We're also demonstrating the scalability of RF-SOI for adjunctive [indiscernible] nodes below 40-nanometer to address new millimeter wave applications. FD-SOI is already embedded in a few [ hidden ] phones, in particular for millimeter wave, but also [indiscernible]. And FD-SOI will deliver up to 10%, 20% longer battery life with indicated [ PAs ] that deliver a combination of performance, power and thermal efficiency benefits. The road map will include high-end smartphones by the end of 2024 and demonstrate its scalability potential. Finally, to leverage the transition to higher frequency like FR2 plus and later 6G. Soitec is working on combining FD-SOI with a higher resistive substrate. Our next product in product family is Connect POI, again, it is successfully adopted from mid-high bands. This product solve multiple technical challenge in the transition from 4G to 5G, including increased bandwidths, lower thermal issues, and scalability to 8-inch. For these reasons, we are extending our POI road map scaled towards lower bands while working with some partners on mid-high bands. Let me now finish the review of Soitec product road map with RF-GaN. Today, GaN-on-Silicon carbide is a standard for 5G MIMO base stations. In parallel, we are providing GaN-on-Silicon solutions for [ smart cells and CP ]. on top, we are developing GaN-on-Silicon for [ onset ] applications, thanks to low voltage compatibility. Extended performance to the new FR2 and FR3 spectrum, but also the 200 millimeters scalability. To conclude, I'd like you to take 3 key messages. First, 5G Advance, 5G smartphone, penetration and new use case proliferations, thanks to 5G Advanced and millimeter waves are the engines of Mobile Communications division growths. Second, WiFi is a great opportunity for our products to increase our standard coverage. And third, we are deploying a comprehensive product road map, offering high value to the RF front-end market, which is the DNA of our continued success. Before leaving the floor to my colleague, Emmanuel, let me show you a testimonial from Tom Caulfield, CEO of Globalfoundries, talking about the Golden Age of Semiconductor.

I'm pleased once again to be part of Soitec's Capital Markets Day. 2 years ago, I shared an overview of the strong partnership GF has with Soitec. And I'm happy to say that our partnership and collaboration has continued to grow. We all see the megatrends powering the digitization of our industry and the shift from compute-centric to pervasive computing. These shifts are driving exponential growth, building on previous errors, not replacing them. We are adding functionality and better utility. Silicon content in our devices is increasing and must be more intelligent and secure. We need smart and connected sensors working in unison to sense and act at the surface of the edge. This is the next golden age of semiconductors. It is grounded in IoT and is the first era of computing, not driven by Moore's Law scaling. To compete in this new age, it's all about power, power, power. It's about the best RF wins and it's about intelligent and secured digital processing. Our FDX platform and road map is all about innovation beyond transistor scaling. In partnership with Soitec and others, we are providing leading solutions for automotive, smart mobile devices and home and industrial IoT. GF's differentiated solutions leverage the different types of SOI technologies from Soitec. Together, Soitec and GF play a vital role in doubling the size of the semiconductor industry in the next 8 to 10 years, accelerating the transformation for full digitalization and supporting the decarbonization of the economy. I deeply value our partnership with Soitec and look forward to continued collaboration. Thank you for having me.

Hi, everyone. I am Emmanuel Sabonnadière, VP of Soitec Automotive and Industrial divisions. I joined Soitec 2 years ago. Previously, I was leading CEA-Leti, the Research Institute of Microelectronics in France. Before that, I was VP in various competitive positions for Philips Lighting, which become Signify, General Cable and Schneider Electric, with multiple businesses in automobile, automotive and industry. But let's discuss the latest performance of my division and share with you what's next to come. Our last year, we delivered a strong performance with around 80% growth. We expect to multiply the size of the division by almost a factor of 3x by fiscal year '26. By then, around 50% of the division revenue will be generated by SmartSiC. We built our growth on 3 key market drivers. In vehicle connectivity as car becomes increasingly more digital and more demand for functional safety. Edge computing for zonal architectures with a higher need for automotive driving and more robust artificial intelligence. Electrification of the powertrain as the industry is rapidly transforming to electrical vehicle. And finally, Industry 4.0 and renewable energy with more automation and efficiency. Looking further into the auto industry, we are leveraging 2 main trends: the digitalization of the car, and it's electrification. Digitalization will drive growth essentially 2 levels. One, autonomous driving and artificial intelligence will create a need for 10x more semiconductor -- semiconducting, computing power. Second, zonal architecture for better response time, will require more FD-SOI. The second trend, electrification. It is accelerating. More than 70 new EV models were presented at the Shanghai Automotive Show last April. That should give you an idea how intense the market is. In this market, we see the powertrain emerging as a new engine and becoming a cornerstone of competition for IDM and OEMs. From a material perspective, silicon carbide is positioning itself as the new standard. It enables longer mileage, faster charging, and lower system costs. That's why its penetration into the powertrain is increasing and extending into mid-range EVs. GaN power should also have a bright future beyond communication. This should touch both automotive and industry. How do this impact the semiconductor content opportunities? This picture echoes what Jean-Marc just presented. Soitec is a content growth story. This picture -- we show in this picture, an increase about 4x in the millimeter square per car between 2021 and 2026, especially in the powertrain and ADAS as the two main drivers. This is significant opportunities for Soitec product. So now let's dive into our product road maps and value creation for our customers. Power-OI is a critical product enabling superior performance towards more electronics into the cars. We leverage strong momentum, especially around 2 areas. First, every MCU, MPUs is associated with growing numbers of power management integrated circuit, what we call PMICs. Second, the increased needs of functional safety, robustness, noise immunity and high temperature capability owe the Power-SOI key attributes to push performance of modern cars. In our road map, the transition from 200-millimeter to 300-millimeter is accelerating driven by the battery management systems. Second product, FD-SOI. FD-SOI is now entering in the automotive industry. Its material properties enable greater computing power, while maintaining low energy consumption. It has been identified as the solution to accelerate the transition out of CMOS technologies toward more advanced and lower nodes MCU, MPU such as 28 and 22 nano and beyond in FD-SOI. This will deliver increasing RADAR detections by 50% and reducing carbon footprint by 30%. Let's continue with something that was an opportunity not so long ago and is now a reality, SmartSiC. You know it, and as Christophe name it, it's a greener, faster and better solution for EV inverters. It is a disruptive product with the ambition to become an industry standard. Greener by design SmartSiC reduce carbon emission across the whole product life cycle. Faster, SmartSiC enable to reduce tension on the supply chain, especially in 200 millimeters. A year ago, we already demonstrated SmartSiC for 200 millimeters because we know how critical is this next -- in this innovation for the next big steps for the IDMs to accelerate the transition in EV and of course, better on performance, SmartSiC is more conductive enabling cost reductions at device and systems level. All in all, SmartSiC is a game changer. We are progressing as per plan. Since last December, STMicro started the 18-month qualification of our SmartSiC technology in partnership with our teams in France and their teams in Italy and Sweden. Most probably, you will find SmartSiC inside into cars at the end of the next year. And we are not stopping here. SmartSiC, advanced in the road maps, still in R&D, will bring more stability, more repeatability, yield enhancements and repeatability improvements. From a material perspective, SmartSiC combined, as Christophe explained, a final layer of MonoSiC with ultra-high conductivity handler made by PolySiC. This unique combination allows for more than 10x reusability of the MonoSiC donor and about 8x better conductivity. How does this strong attribute benefit the device? And this is on the right part of the slide. The better conductivity allows up to 20% reduction in the key figure of merit of power electronics A-on-A, the intrinsic resistance of the power. This corresponds to a jump of 1 generation of device, which is about 3 to 4 years. Lower A-on-A also means higher current density given device makers the flexibility to choose between a smaller die for the same ohms of current, which means more die per wafer or a higher quantity in the same die, which means higher value per device. That's why today, almost all key players are assessing our SmartSiC solution. SmartSiC has become real. We generated our first revenues this last year with SmartSiC. We brought it into the market in a record time. From the first decision to develop SmartSiC in 2018 to the transfer in production in our new fab, Bernin 4 scheduled in September 2023. Along the way, we met significant milestones. We have demonstrated the maturity of the technology as well as the performance and the product reliability. Soitec is now ready for high-volume production. To conclude, between the rapid growth of SmartSiC, the increasing demand of power SOI, the growing need of FD-SOI and the gallium nitride products still in R&D, the Automotive and Industrial division has a bright future. Please let me hand over to Michael for smart device. Before that, it is a great honor for me to share a testimonial from a very important customer of Soitec, may I introduce Jean-Marc Chery, President and Chief Executive Officer of STMicroelectronics.

So hello, everybody. So my name is Jean-Marc Chery. and I am the President and CEO of STMicroelectronics. Thank you, [ Pierre ], for inviting me today. I am happy to deliver this short video address. Let me start with a quick summary of who ST is and what we do. Before moving to another view of our collaboration with Soitec and how it contributes to ST's business objectives. ST is an integrated device manufacturer with the 14 main manufacturing sites and employing more than 50,000 people around the world. We have a strong long-term commitment to sustainability, including our target to be carbon neutral by 2027. We have a strong focus on the automotive and industrial end markets where ST is a worldwide supplier to the world's leading companies and which represent about 2/3 of our business. For the application supporting these end markets, we aim to provide our customers with technologies and products that are clear differentiating enablers. And this is where our collaboration with Soitec brings important benefits. Soitec is one of our top-tier wafer suppliers, supporting our business ambition. A long-standing procurement of SOI wafers in various flavors. RF-SOI, Power-SOI, FD-SOI, Imager-SOI. These technologies are instrumental to deliver some of the products on which rest our leadership ambition in industrial and automotive and selective leadership in other areas, such as personal electronics. These are other ongoing technology discussions, evaluation or cooperation at R&D level and other specific technologies, including sometimes we see a [indiscernible] I won't go into detail for this short video. But clearly, this is a testament to Soitec's state-of-the-art technologies and expertise. What I can mention in 1 key area where we are moving forward to support ST's ambitious growth, silicon carbide. ST is evaluating Soitec's SmartSiC technology with the goal to integrate it into its substrate manufacturing process as an enabler for additional volume ramp-up. The target is to qualify SmartSiC on ST's SiC MOSFET technology in mid-2024. With products based on SmartSiC to be available from Q3 2024 onwards. Overall, this will support ST's deployment plans for 200-millimeter silicon carbide substrate manufacturing. To conclude, we are looking forward to continuing to work with Soitec. Success will continue to happen if we continue to collaborate as we are doing today with mutual value creation for our respective customers, shareholders and stakeholders globally. Thank you.

Thank you, Emmanuel, for the very motivational talk earlier. Hello. My name is Michael Reiha, and I'm the Head of the Smart Devices division. I joined Soitec about 4 years ago as the General Manager of what was now formerly known as the FD-SOI business unit. And previous to Soitec, I was a Soitec customer as the head of Nokia's 5G RFIC division. So what is a smart device? At Soitec, a device is smart if it can intelligently sense its surroundings, compute data under flexible power conditions, and network data efficiently and with ease. And so therefore, we look at this segment with 4 key questions in mind. Why is compute need to be smart? How do we build smart sensing? What is required for a smart computation and how we at Soitec are prepared to disrupt in this space? And so there are 4 -- 3 key trends that we are following. The first trend is in AI and how can we scale the amount of inferences per watt per dollar. The second is in sensing. And how can we scale resolution. And third out is on compute. So we tend to focus on sensing in terms of providing a need for speed. And most importantly, we refer to devices that can sustainably connect devices between edge and cloud. Our growth is predicated upon 3 trends: meeting higher speeds and lower power consumption in data center interconnects, meeting the tremendous growth for inferencing in terms of inferences per dollar per watt at the extreme edge and for real-time processing and to meet high resolution solutions, including event-based image sensing and expansion of voice recognition. Sensors at the edge are very complicated now in the sense that they require battery operation, lowest cost per bit and longevity in the field. The expectations are sometimes more than 10 years. And this is a very challenging combination. In parallel, sensor data processing such as inferencing is placing a lot of constraints on communication latency and memory size because at the edge computing, memory is competing with compute power. But by meeting these combined demands, we are bringing to the market a very exciting different set of class of products, including intelligent object detection, true wireless stereo and flexible video surveillance that could be quickly deployed. We see significant opportunities in image sensing and image and video capture in the future, and our right to win is leveraging examples of compute through IoT sensing and low leakage memory. Moore's Law, of course, has powered the age of personal and network computing. And previous challenges were met with scale performances on chip architectures such as parallel processing and multicore CPUs. That being said, we are entering an age of computing, where off-chip architectures are becoming paramount. Co-packaged optics otherwise known as CPOs leverage our smart Photonics-SOI technology and will replace copper interconnects with Silicon Photonics interconnects. Increasing speed over distance while limiting power consumption is placing greater demands on the optical interface within data centers. And there's a tremendous amount of R&D work that's still needed to establish Silicon Photonics as a mainstage solution within the data centers. But our right to win is that we have a multigenerational road map that addresses both the data center and telecom demands. So today, AI and ML architectures are straddling between the electrical and optical interfaces. But more cost and more power is not an option. And this is why co-packaged optics or CPOs are envisioned to absorb many of the CapEx and OpEx challenges realized by our customers. The industry estimates that CPOs are going to deliver 30% power savings and equate to 40% cost reduction per bit. But the massive growth of CPOs will only aided by Soitec Smart Photonics technology and our right to win is that we are an established R&D trusted partner in this space. So Soitec is today enabling both the edge and the cloud. Our smart compute addresses an array of products from interconnecting from gateway routers and even network switch ASiCs. And we are meeting AI on several different fronts. First, in enabling low latency transfer required to bridge inferencing and offloading; second, ultra-low power security IP for battery-powered devices; and third, real-time throughput that bridges the edge and training in the cloud. We see tremendous growth in securing data transfer between edge in the cloud, and we will be leaders in Industry 4.0 for automation and where network meets cloud for telco applications. Our portfolio leverages, as Christophe described earlier, Smart Cut, one of our fundamental pillars at Soitec. And our primary target is meeting energy efficiency with sustainably aware electronics. Our Smart Imager SOI and Smart Photonics SOI addresses the sense in network applications, respectively, and our Smart FD-SOI and Smart PD-SOI address our computing endeavors. Our Smart imager SOI portfolio aims to address front side illumination. And we've met the industry with a resounding success. Our Gen 2 is planned to continue on this path to success with supporting 3D stack architectures. With 3D stacked architectures, we can improve the pixel pitch, which in turn will increase image resolution, lower power and increased fill factor. We aim to enable between 4 and 10x increase in resolution with 3D stack architectures, and we believe that this will allow us to continue our success in image sensing realm. The Silicon Photonics is going to play a major role with data center connectivity at the top of the list. Today, we are the leading supplier in both 200- and 300-millimeter foundry supply, and we have a very aggressive road map. Our goals are to improve first substrate uniformity by 40% and by doing so, we will enable higher speeds for data communications in excess of 1.6 terabits per second and higher modulation rates for coherent radio in excess of 64QAM, as an example, will be used in advanced 5G architectures. CPUs enable the co-integration of optics in the ASiC in a common package. And we believe that our Smart Silicon Photonics road map for uniformity will lower power consumption and will aid the industry in achieving lower cost, higher volume yields. This is why we believe we are on the right track to enabling quantum computing. I am very pleased to announce that the growth of Smart FD-SOI is now, and it continues to highlight our industry-leading merits. For example, an ultra-low memory leakage, we have seen repeatedly that ultra-low memory leakage is 10x better than in base using bulk substrates. And this is highly, highly encouraging for systems that use AI and they're therefore, very memory-intensive. Our performance on demand can be boosted by over 25% with advanced power management techniques such as body biasing. And we continue to innovate with our Smart Cut technologies so that we can target 12 nanometers and beyond and even enable other foundries. The future of FD-SOI is tremendous for us, and it is a very exciting time. So we have been evolving Smart FD-SOI has been significant in the past few years at a compounded growth rate of over 70% when considering this application of smart devices. Our Smart Photonics SOI commands over an 80% market share today, servicing 5G networks and also high bandwidth access to compute and storage. So today, we are an enabler. Our Smart Imager SOI is shipped in over 25 billion devices per year. And on the compute realm, we address MPUs, MCUs FPGAs and in architectures such as edge and heterogeneous computing. We are setting ourselves up to become the standard for tomorrow. Smart FD-SOI continues to be developed for supporting future nodes and future foundry partners. And Smart Photonics SOI will meet the industry mark of reducing power by 30% and set up Soitec as a leader in the area of quantum computing. Our success -- and our success alone comes with trusted partnerships. And I'm very pleased to introduce Dr Gibong Jeong, EVP of Business Development from Samsung Foundry. Samsung Foundry has trusted Soitec and our materials such as FD-SOI and bringing an exciting realm of products to market. Products that leverage their best-in-class leadership in memories, therefore, including a very exciting subset of edge computing devices. Thank you. [Presentation]

Hello. Welcome to Soitec Capital Markets Day. I am Dr Gibong Jeong, Executive VP of Foundry business development at Samsung Electronics. It's a great honor to have this opportunity to share with you some of the key focus areas of Samsung Foundry. The rise of new markets and application in HPC, automotive and IoT is driving the growth in shaping the future of semiconductor industry today. This new markets and applications demand more energy-efficient computing devices. We believe that possible solutions are novel computing logic technology like GAA, new memory solutions with wide I/O and low latency and last but not least, advanced packaging for multi-die integration. We, Samsung Foundry will offer all as a one-stop service to our customers. In the last couple of decades, our investments to both R&D and production capacities have enabled Samsung Foundry as a leader in mobile computing and new markets and applications. We believe that collaboration is a key to success in this industry and we are excited to work with Soitec to deliver even greater value to our customers. With the support of Soitec and its evolving FD-SOI technology, Samsung Foundry has demonstrated greater flexibility to its customers, enabling them to realize market differentiating products in low-power IoT devices, UWB connectivity and automotive devices, all using a single platform. I express my gratitude to Soitec for their commitment to Samsung Foundry, and I extend my congratulations to them on their Capital Market Day. Thank you.

Thank you for your attention. So we're now going to move to the first Q&A for about 20 minutes. So for this first Q&A, and I will call back the first batch of speakers on stage. Welcome back. So for the first Q&A, so we will take questions from the room, we'll take questions from the webcast and also from the conference call. We would like to focus on business, strategy, innovation. So the question is related to finance, operations, governance, which I'm sure you have will be taken in the second Q&A when we come back after. So first set of questions related to strategy, business innovation.

Aleksander Peterc from SocGen. I just have 2 product questions. The first one will be related to silicon photonics. Can you confirm did you have very high market share in silicon photonics that is destined to the optical interconnects sort of PAM4 DSPs, for example, that was cited by Maleville, in particular, recently has been a big driver for growth in AI. So if you can confirm that. And the second one would be on silicon carbide. If you could explain why you have a particular advantage at 200-millimeter and also if your process can help with the warping problems that have been encountered by the 200 millimeter silicon carbide wafer manufacturers?

Okay. So first one for Michael and second one for Maleville?

So if I rephrase the question, is to come make a comment on our road map for silicon photonics? Yes. So as alluded, silicon photonics is very exciting for us because we're addressing both datacom and telecom. And you provided a very relevant example for the telecom space. What we need to do is provide a multigenerational road map that was as alluded, where we improve substrate uniformity that would allow for even more modulation schemes and also improved or increased modulation density. And this will allow coherent radio applications such as one that you highlighted to get into spaces that are currently today at IMDD.

So regarding silicon carbide and 200 millimeters because that was it's in the heart of your question. Two things. First, the larger the surface is the better is it for the bonding. So that's something we demonstrate now since years. Then switching to 200-millimeter is for us kind of gift in our road maps. Now regarding 200-millimeter, you're perfectly right. So growing silicon carbide in 200-millimeter is really difficult because just for the seed as a bulk, it takes more than a year to move from 150 to 200-millimeter as a seed and after that, you have to have the growing process working well. So our partners and our clients and our friends are working very hard to get this mono SiC in 200-millimeter life. We work with most of them because immediately, they want to test how it works with Smart SiC, and it works very well. So it's clear that with our new fab of [ Bernard and Cyril ] will develop about it, we did it in 200 millimeters as a focus. So it's a bridge one. We can switch from 150 to 200 millimeters. But the center portion is 200 millimeter. And it's sure that now having the leaders who wants to move fast and quick in 200 millimeters and having our ability to multiply by 10, we can see as a kind of solution for them in order to address this huge market. So yes, I think Smart SiC will be a good element for the 200 millimeters development.

Okay. Thank you. Next question?

It's Mehdi Hosseini from Susquehanna International. Just as a follow-up to SiC, there's a lot of investment in CapEx by some of your competitors. And if you're in evaluation with prospective customers, how will they adjust procurement from these competitors that are in a very aggressive ramp-up linked with capacity. And I asked the question because I'm under impression that your technology doesn't require as much of a CapEx. It's a very capital efficient. At the same time, there's a lot of investment going on. So how can I reconcile these 2? And then as a follow-up, what would it take for you to have additional prospective customers other than ST Micro?

It's clear that the ability we have to cut 10x mono SiC donor, it makes CapEx footprint for, let's say, licenses, customers and so on totally different plus the fact that the concentration of components on the top of Smart SiC were first makes also a big difference. Then it is a game changer, and there is the note that has been diffused last week, independent note, showing clearly these advantages. This is the reason why we believe that SmartSiC will become step-by-step standard where we have STMicroelectronics having selected these solutions first of all, us to provide them to use it as a license. But of course, we are discussing with other big players in the SiC market, big players for which we expect to get some good news in the coming quarters, then this is one of the key drivers for the Smart SiC adoption. Keep in mind also that at the end of the day, the product is making the cars with a better range in terms of, let's say, consumptions, battery consumptions, but also the chargers will get less time for charging. And these are the 2 constraints today that makes electrical vehicle less let's say, spreading out. But it will accelerate this adoptions. And as you know, we are keeping the path to believe that we're going to get at minimum 30% of the SiC market by 2030. But with the drivers we just discussed and you underline, may be better. We are, I believe, a bit conservative for the moment.

Thank you, Emmanuel Matot from ODDO BHF. Two questions, please. First, regarding geopolitical tensions, would you say that there are an opportunity or threat for European players such as Soitec, how is the FD-SOI ecosystem is notably developing in China? Are you regarding the option to have licenses there for that technology? And second, I understood last April that the downgrade of your sales target for fiscal year '26 was only related to the negative evolution of the smartphone market. I'm surprised to see that you are less optimistic also for automotive and industrial and more optimistic for smart devices. What are the reasons for those updates on these 2 divisions?

Okay. On the first question regarding global tensions, as we say, we believe that we have our DNA makes Soitec able to navigate within these global tensions. The fact we are based in France and in Singapore, mainly but of course, with a lot of offices in many countries is making us quite agnostic in our, I would like to say, passports. And as a matter of fact, we are in contact with a lot of authorities in China, in the U.S. elsewhere to continue driving our ability to provide engine substrates everywhere in the world. And of course, we are monitoring very cautiously the sanctions here and there. But today, looking at our portfolio, we see really our ability to really be to some extent, neutral agnostic and being present everywhere. China, as an example, will become more and more important countries in terms of revenue for us as well as the U.S. because we're going to accompany [ outsource ] the rebalancing of productions and decision makers in this world. The fact we are benefiting from subsidized in Singapore, subsidized in France. We are part of the IPCEI Chips Act in Europe, maybe also first key assets, we're going to leverage. For the second part of your question regarding China, FD-SOI and so on. We are not looking for licensing many players today. As you know, on RF-SOI, we have 2 licenses. We have licensees for Smart SiC, seems to be good enough. Then maybe we could be opportunistic in this way of getting additional licenses, but it is not really what we're going to pursue. We're going to be very opportunistic in the way to expand, as I say, geographically speaking. Then we see big areas in the U.S., in Japan and elsewhere as quite interesting, let's say, targets, but we're going to be very pragmatic. At the end of the day, our innovation are keys, our technologies and patents are absolutely keys. This is one of our other secret sauce and it's where Soitec is undisputed. Perhaps, Christophe, if you want to comment on China?

I can just complement from your FD-SOI question is -- China is a planar technology. They are looking like everybody for more performance, less power, reducing the costs and so on. So I guess, for us, selling FD-SOI substrates, which is an easier path to accelerating this power performance couple, I think, is an opportunity for Soitec to sell substrates from France and Singapore. So I'm the optimistic guy. So I'm on the opportunity side.

There was another question on if I remember, on the updates. Then I'm not sure I understood clearly the question because if we look at the evolution of our revenue for fiscal year '23 to fiscal year '26, you see a strong increase in Automotive and Industrial division from 13% of weight in the revenue going to move up to 20%, fueled by, of course, a Smart SiC strong development, but also FD-SOI Power-SOI within the cars, and it's also a very important driver. And smart devices will also take the ride with we discussed about photonics, FD-SOI and so on. Then all in one, we're going to move from 67% mobile communication to 60%. It means it's going to grow. It's going to continue to grow with, of course, a strong takeoff of POI starting now. Let's say, decent growth in the other technologies, especially RF and acceleration in FD-SOI, then all in one, automotive, industrial and smart devices. As I said, we'll wait close to $0.5 billion each. It's another dimension. They're going to really move into another league. This is what we see, and this is our plan. Then at the end, we're going to grow as planned and not less than what we were expecting initially.

Sébastien Sztabowicz for Kepler Cheuvreux. For M&L on SmartSiC, STMicro has been quite bullish on the technology and [indiscernible] is the benefit in terms of cost. Could you help us quantify a little bit the cost benefit for your customers, both on COGS, OpEx and CapEx to understand a little bit. Who you can differentiate from traditional silicon carbide wafers and for Christophe on Smart GaN, when do you expect to start to ramp your product for this specific technology? And what could be the end market that you can address with Smart GaN? Is it onboard chargers, smartphones, base station servers? Do you have any idea of the specific application there?

So as you know, for SmartSiC and it's a recurrent question will not communicate on our cost, but we are only communicating on the value created. So as [indiscernible] has been mentioned, we are highly beneficial for the OpEx of our customers because they gain a lot by using our technology. Additionally, again immediately because the wafer is less resistive as I explained, an additional is more flatness inside and so on. So on the process itself, there are some yield gain, which are obvious. And additionally, there is big CapEx avoidance for them. So as the overall benefits using SmartSiC, it's obvious that they gain in -- they gain a lot.

Yes, for the Smart GaN, so well -- 2019, we talk about silicon carbide 2023, we ramp, '24, we ramp so 4, 5 years. I'll try to do as quickly as the previous time. So let's say, 4 years of reason. In terms of the application, well, the approach is we developed this Smart Cut of GaN and then we know we can associate with all these different substrates to address horizontal GaN, vertical GaN, RF. So you named the applications like from the power, which is the onboard charger, lower voltage to a higher voltage. And on the RF, there's big opportunities for base stations for handset. So we'll try to make it as versatile as possible to adjust to many, many of these base substrates and address all the market. I think this is the best we can give to the technology investment we're doing.

Very happy you mentioned Smart GaN again. It's very important. It will disrupt the market you'll see.

Maybe I can just elaborate a little bit on the market that we can address with Smart GaN. So today, as you know, I mean, GaN on silicon carbide and GaN on silicon mid-market is a base station, so as is MIMO. There is no today GaN introduced on smartphones and on sets. We're working with some partners to develop these solutions, which we're very disruptive, especially with low-voltage compatibility. And moving to Smart GaN, again, it opens the door to more integration. So not only for amplifier. I mean, you can -- I mean, as Christophe explained, you can transfer the Smart GaN on any type of substrates. So we are working with the partners to identify what is the best substrate. It could be SOI, it could be polysilicon carbide, it could be -- and then, I mean, you can imagine -- I mean, everything you can do and not only [indiscernible] on one day because the market is asking for more power density, more integration, more shrink to add more features everywhere in the smartphones. So this is where the marketplace.

Olivia Honychurch from Jefferies. Back to SmartSiC, the $210 million of revenue that you forecasted for 2026. Can you talk a little bit about your assumptions within that between 6 and 8-inch wafer sales? And maybe give us a little bit of color I know you won't be able to be too clear on the cost or ASP differential between the 2? And so what I'm really asking is, is there upside to that $210 million if you were to tread more in the 8-inch wafer territory versus 6-inch than you're currently expecting?

The qualification process and what we will start and how we will start our factory in Bernard in September will be in 6-inch. And -- but almost just after that means less than 6 months after, we'll switch it in 8-inch. So as I said, we'll stay bridge, so we can switch from one to the other pretty easily, but massively, we want to move it in 8-inch because we think this is where the momentum is. After that, it will depend on from our customers. So it's true that the reality today is more in 6-inch. But the huge demand we received is in 8-inch. So 8-inch in terms of the ratio of the surfaces, you know that it's a ratio of 1.81. So there are some massive benefits moving quickly in the 8-inch for the device maker or the car manufacturers. And for us, that's also obvious we have more value in 8-inch than in 6-inch, then we will try to play with all of that and to make our success with that.

Jerome Ramel from BNP Paribas Exane. Two questions. Could you update us on the FD-SOI roadmap 28-nanometer node? We don't really hear [indiscernible] 18 anymore. I think the Chips Act of the European Commission is talking about down to 10 -- 10, 12. So if you could update us on where we could see the road map. And the second question would be on SmartSiC, is it fair to assume that for tranche, the value of SmartSiC is more on the yield improvement you mentioned than the reduction of the RDS on?

Probably it's the quickest answer on the SmartSiC and I give you on the FD. No. The benefits will be on both either for the low resistivity on the wafer itself as in addition, the yield and the flatness we gained due to the utilization of the polySiC, either in crunch or in planar. You've seen in my slides, there were ABCD anonymized clients inside and 2 of them are in tranche. So you've noticed that there's a little difference. But honestly speaking, it's not so significant. It's the overall payback of the SmartSiC for the device maker.

On the FD-SOI, you've correctly highlighted that there was a lot of recent news on investments of the new fab in Crolles, the joint partnership between GlobalFoundries and STMicro. So this addresses 18 FD-SOI. We have a very active roadmap internally in the Soitec in preparation for advances beyond 18. And that includes our advanced SmartCut 3.0 technology. So we expect there to be a very bright future for FD-SOI developments, particularly in the next year.

Unfortunately, we are going to ask you to stop here, this Q&A. We'll go on a break for 5 short minutes, and we will be back for the remaining of the CMD. Thank you very much back in 5. [Break]

Welcome back to the second part of Soitec 2023 Capital Markets Day. We will now continue the agenda with the presentation of our operation. So my pleasure to introduce our COO, Cyril Menon. Welcome, Cyril.

Thank you, Steve. Hi, everyone. I'm Cyril Menon, I'm in charge of operations. I've been with Soitec for 17 years, and it's a real pleasure today to be here for my fourth Soitec CMD. We'll start with 3 key messages I want you to take away. First, we are deploying our industrial model, focusing on its scalability and agility. I guide you to help you understand how we can scale production and remain agile. Second, we care very much about flexibility to adjust to our demand. And finally, we are delivering sustainable growth caring for talents and resources. In the past 6 years, we scale up our operation to grow revenue fivefold from USD 250 million to USD 1.2 billion. Meanwhile, we have created a more global and more sustainable operation organization. Let me detail what we have built and where we are eating. In the past 5 years, the 2 most dynamic, the 2 most growth driver were SOI 200mm and SOI 300mm. Going forward, we will rely on 3 major pillars to sustain our growth and to sustain our 3 divisions. SOI 300mm, which remains a significant driver, 150-millimeter POI for the mobile industry and 150 and 200mm SIC to supply automotive. In the next year, we will install additional capacity with the objective to be ready by end of fiscal year '24 to support the business acceleration expected in fiscal year '25. Our industrial footprint became global with the addition of our facilities in Singapore. With the extension currently ongoing, Bernin 4 for SIC and Singapore for SOI 300mm, we are leveraging both our expertise and know-how to achieve scalability, [ robust ] business and agility. I'll come back to this. Today, we rely on a robust workforce of almost 500 employees in Singapore and of around 1,700 employees in our French hubs production site. Maximum SOI capacity of 1.45 million wafer per year in 200mm SOI and up to 2.75 million wafer per year for SOI 300mm. We will increase our capacity in both POI and SiC, respectively, up to 700,000 wafer per year and 500,000 wafer per year in Bernin. As a reminder, both POI and SiC in Bernin 3 and 4 are highly flexible on the 150-millimeter wafer size and 200mm. Last year, we announced groundbreaking to expand Pasir Ris production site. And basically, we broke ground back in December 2022. Remember that no customer qualification is needed for such an extension. This enabled us to adapt to business need and easily tune the ramp-up towards high-volume manufacturing. The project is on time, and we adjusted its development speed to be ready by Q3 Calendar '25 as opposed to Q1 calendar '25 initially. Let's move on to our new French facility. A year after the Bernin 4 groundbreaking ceremony, the SmartSiC factory and [indiscernible] are ready. And we are currently installing and qualifying the tool to deliver the first qualification samples anytime soon. Such a performance of erecting in a year a new semiconductor plant is outstanding and has been possible, thanks to Soitec amazing teams and partner truly dedicated to the success of our company. Both the 150mm and 200mm pilot line benefit from our engineering experience from the Substrate Innovation Center to achieve high volume manufacturing for this new product. 20% of Bernin 4 will be allocated to refresh 300mm. In addition, it is fully connected to both Bernin 1 and 2 on the left and our logistics platform on the right enabling future synergies. Let me show you how our SmartSiC supply chain is sustainable and agile. First, we have optimized our supply chain with a range of different partners for commercial mono SiC, and we have organized an entirely new ecosystem for polySiC wafers. Second, sourcing monocrystalline SiC is a critical path, which our market technology helps overcome since 1 mono SiC, we can produce 10 SmartSiC. In addition, our SmartSiC is saving up to 70% of carbon emission versus commercial SiC. From fiscal year '22 to fiscal year '26, we now forecast to invest EUR 1.5 billion in CapEx. 35% of this total CapEx is used to upgrade our SOI capacity. 20% will be spent to expand our 300mm footprint in Singapore. 10% is used to support our POI factory, Bernin 3. 15% is spent to support the silicon carbide factory, Bernin 4. 10% will be spent for imaging activities such as gallium nitride and innovation projects and 10% to support ESG project and IT upgrade. Compared to our last communication, this is an increase of our CapEx budget for fiscal year '22 to fiscal year '26 by 6% or EUR 100 million. On the back of an equal impact of foreign exchange, inflation and ESG project. After this review of the status and forecast of our scalability challenges, let's turn to Soitec operations model. We are organized to manage the entire supply chain from planning to execution, from a large number of suppliers, equipment, substrates, utilities, our operation all the way through to our customers. It relies on central planning supported by several global services such as IT, quality, engineering and sourcing, which is ultimately executed by the local operation teams. Addressing such a growth challenge does require ambition. And at the same time, we have to keep our fundamentals based on a rational approach and agility. I'd like you to help you understand better why our model is truly scalable and agile. We have 4 pillars to achieve this. First, we adapt our supply to customer demand, not too late and not too early. Second, we have the ability to create synergies by sharing resources in the same organization, such as compound semi operation in this slide. Third, we protect margin by leveraging our asset at the earlier stage. For example, we combine new businesses introduction with the immediate benefit from a large 300mm refresh activity. This enabled to lower breakeven point of new activities. And our fourth pillar rely on the fab extension to leverage existing footprint and accelerate qualification. This helps to avoid a longer-time anticipation. In addition, Christophe told you, innovation is part of Soitec DNA. So is the ability to continuously improve and to industrialize our innovation. Digital twins to shorten facilities lead times through building information modeling, or enhance the performance of our assets by reducing energy consumption, for example, AI to reduce metrology costs, Smart something is a good example of a search engine initiative or improved detection of pattern recognition and ultimately leading to augmented quality. We also deploy a series of digital tools to continue to improve the team's performance and productivity in SG&A and especially [ interchanging ] self, and accounting. So let me show you now how our standards and methodologies lead to performance. Singapore will be as competitive as Bernin as soon as fiscal year '25, thanks to a better cost absorption when ramping up refresh NAP. Singapore did ramp 10x in 2 years, reaching 150,000 wafer per quarter in Q4 fiscal '23. Bernin POI did ramp 10x in 18 months. And we continue to improve the yield of our product, delivering a better margin and delighted our customer with a higher quality. This ability to industrialize innovation, enhance continuously quality and improved competitiveness is a major asset to continue to secure our market share and to manage an aggressive and profitable growth. After this review of the scalability and agility of our model, let me now dive into our sustainable approach to growth. At Soitec, we care about our people and focus on attracting talent, growing skills and enhancing our work environment. We're engaged in multiple initiatives. Here are a few examples. We are investing more in partnership with success as we broadly earn levels to attract and develop young talent for the industry. As a second example, we offer our employees the possibility to become a shareholder. And last but not least, we are carefully monitoring the quality of life at work regularly pulling our employee to improve it. As Pierre pointed out today, we are very careful about our environmental impact and constantly increase efforts to reduce water consumption and carbon emission. We have set ambitious objectives such as growing more than 2x while reducing our absolute carbon emission by 25%. Deploying a robust management system inspired by ISO 5001 both in France and in Singapore. We are all mobilized to reduce water consumption intensity significantly improved by 30% in the 2 last years. We aim to increase secular manufacturing by recycling water and reuse it looks to further lower energy consumption. And finally, in France, we are using 100% of low-carbon energy and securing around 40% of green energy in Singapore. We work similarly on our extent Scope 3 to the benefit of the entire value chain. First, we are aiming at reducing transportation needs and at reducing carbon by 40% through an optimization of our supply chain organization. Second, we're making sea freights our first transportation choice to reduce emission as sea freight versus air freight carbon emission is 100x lower. And third, we are embarking our supplier on our path. We will seize benefit in the next coming year, fulfilling our firm and ambitious commitment to significantly reduce Scope 3 carbon emission intensity by 35% by 2026. Before handing over for finance presentation, let me wrap up my part on operation. Soitec industrial model is scalable and designed to preserve its agility. Second, I reiterate, we've always been wise when we invest in manufacturing, and we care very much about efficiency and flexibility to adjust to our demand. And finally, we care about our people who are the core of our daily attention to deliver sustainable growth. Thank you very much. Let me introduce Lea, our Chief Financial Officer. Lea, the floor is yours.

Thank you, Cyril Menon. Good afternoon, everyone. Before speaking about our FY '23 performance, let me share with you 3 key messages. First message, we expect fiscal year '24 to be a transition year after a reacceleration in FY '25 and in FY '26. We are currently operating in a complex semiconductor environment. And after several quarters, during which our challenge was to manage the demand being above our supply capacity. We are now driving our business in a weaker smart phone market, with this inventory digestion. We are pleased to see that our diversification strategy is paying us both for markets and for products. The automotive and smart devices market are offsetting the effect of the temporary weaker smart phone market for FY '24. And beyond FY '24, the engineered substrates beyond SOI such as POI, SmartSiC are becoming very strong growth drivers. Second message, to support this strong, sustainable and profitable growth, we need to continue to invest at the right path. This is why we expect to invest EUR 1 billion in CapEx between FY '24 and FY '26 with a very good return on capital employed, around twice ROI at the end of FY '23, up to 25% at the end of FY '26. Third message, profitability. Our EBITDA will double between FY '24 and FY '26 as we accelerate value creation. Let's start with our FY '23 results. In line with Pierre's closing introduction, we are proud to report that we achieved a robust performance in FY '23 in terms of revenue, profitability and cash generation. We delivered a record revenue above EUR 1 billion, up 19% at constant exchange rate, in line with our guidance. Our EBITDA at 36%, slightly higher than last year, in line with our guidance. Our net profit increased by 15% year-on-year and we achieved a strong cash generation while continuing to invest. Finally, we maintained a very strong cash position. This strong performance in the current challenging micro environment illustrates the resilience of our model and our ability to manage our cost base. We released our revenue in April, so no surprise there. We delivered 26% growth. It breaks them between 19% organic growth, driven mainly by volumes increase and a positive currency impact of 7%. This performance was supported by sustained growth across each of our 3 divisions. Gross profit. Our gross profit reached EUR 402 million, a 37% margin, slightly up year-on-year, thanks to a strong operating leverage due to the increase in activity. All our SOI fabs have been fully loaded during the year, a positive product mix and a strong industrial performance with highly efficient cost control. This is a strong achievement considering the headwinds we faced. As expected, inflation effect, including the increase in the raw material cost in our long-term supply agreements, the margin dilutive effect of currency impact due to the difference between the spot rate at the hedging rate and nonrecurring effect related to inventory depreciation. Operating income. Operating income reached EUR 267 million a margin above 25% improved year-on-year. We continue to significantly invest in innovation and our net R&D expenses increased by 13% year-on-year. Gross R&D expenses before capitalization increased by EUR 15 million. We invested to strengthen our position in each of 3 end markets and across multiple product lines in order to maintain our leadership in SOI business. Continued POI developments for the next generation of products, accelerate on silicon carbide, especially on 200-millimeter and prepare for further expansion. This translated into hiring new talents and strengthening collaboration with innovation platforms. SG&A sales are down to 6.5%, the increase is a number of staff and salaries was offset by the decline in share-based compensation. During the year, we adapted our spending plan and we adjusted our cost structure for FY '24. At the net income level, we also improved profitability which reached EUR 233 million, more than 21% margin. Our financial result is negative at EUR 10 million compared to negative EUR 1 million last year due to less favorable exchange results. Finally, our income tax continues to benefit from tax loss carryforwards and our effective tax rate is at 10%. This is higher than last year because of nonrecurring favorable effect in FY '22. Let's conclude the P&L chapter with EBITDA. We delivered a record EBITDA at EUR 391 million, a 36% margin, slightly above last year. This is our best EBITDA margin ever. Our EBITDA margin results from higher gross margin, lower [indiscernible] sales, higher depreciation and sales. This favorable effect has been partially offset by the decrease of share-based payment expenses and non-EBITDA expenses. The strong level of profitability, despite the macroeconomic situation and especially the effect of inflation reflects the resilience of our business model. Moving on, let's take a look at cash flows. We were able to generate a EUR 34 million positive free cash flow while continuing to invest to support our group expansion. This free cash flow is slightly lower than in FY '22. The EBITDA growth has been offset by the increase in working capital, higher tax paid and increased investments. We already covered EBITDA. Regarding working capital, the increase of EUR 96 million is mainly explained by the increase in activity and lower than payments received from customers due to the timing of our long-term agreements. We continue to drive our group carefully to monitor the working capital needs. About taxes, we had higher cash outs due to nonrecurring favorable effect last year. Regarding cash out from invested activities, we invested EUR 228 million. This amount does not include tools finance through leasing contract. If we include them, total CapEx cash out will amount to EUR 244 million, slightly below our initial estimate of EUR 260 due to the timing of payments. So where did we invest our CapEx? They are mainly related to capacity investment carried out in Singapore for 300-millimeter wafer production, including additional capacity for refresh and epitaxy and, to a lesser extent, in Bernin 4 POI wafer production and renewal investments. They also include investments in innovation, including capitalized range. All in all, our cash position increased by EUR 60 million to EUR 788 million. Financing flows were positive at EUR 20 million. It includes new loans to finance tools both in France and in Singapore. Let's move directly to our financial structure. As you can see, we ended FY '23 with our strongest balance sheet ever both on equity and cash side. Equity exceeded EUR 1.3 billion, up EUR 262 million compared to March '22. Our net cash position remained stable around EUR 140 million. The positive free cash flows generated during the period have been compensated by the increase in financial debt related to new leasing contracts. Let's move to our FY '24 guidance. FY '24 will be a transition year. Let me give you more details about the 3 parts of our outlook: revenue, EBITDA and CapEx. First, revenue. We anticipate FY '24 revenue to be stable year-on-year at constant exchange rate. However, dynamics among our 3 divisions will not be the same. In our mobile division, we expect a strong inventory correction during the first 2 quarters due to a weaker smartphone market, impacting mostly our RF-SOI business. This will be offset by our 2 other divisions, for which the increase in revenue will be driven by strong market dynamics. Growing semiconductors in [indiscernible] with increased electrification and digitalization, in automotive market, where assets are solid. And the dynamic around artificial intelligence both include in cloud and edge computing for our Smart Devices division. Further adoption of FD-SOI products and a rebound in POI product sales, will contribute to the FY '24 revenue and will offset the decrease in RF-SOI product sales. Overall, we have a good level of contract and POI coverage for this fiscal year. We have free discussion with our direct end customers in order to anticipate as much as possible and to adjust if needed. We anticipate our H1 total revenue to decline at constant exchange rate by around 15% year-on-year with a bottom point during our first quarter followed by the strong acceleration during the second half of the year. Even if we are used to have a strongest H2, the significant difference in revenue between H1 and H2 will need to be closely monitored. To manage our production, we must find the right balance between optimizing the use of our usual capacity while managing our inventory and of course, to further adjust costs if needed, depending on the timing of the rebound, then P&L. We expect to maintain our EBITDA margin around 36%. We anticipate our gross margin to stay overall in the same range than in FY '23. We'll benefit from favorable currency effects. Our EBITDA estimate is based on the EUR 1.10 rate, while our average rate for FY '23 was around EUR 1.18. Of course, our strong operational performance will continue to fuel our gross margin. Overall, we expect a good level of loading without any inventory building effect. Our Bernin 2 fab dedicated to 300-millimeter will be still fully loaded and as shown by SOI just before. Our cost per wafer in Bernin 300 millimeter will remain flat, while improving in Singapore due to higher volumes in epi and refresh leading to better cost absorption. We leverage our agile organization to reallocate people from one fab to another in order to optimize our financial performance. On the headwind side, we will face the effect of inflation, including the raw material costs based on long-term supply agreements. We plan to continue to significantly invest in innovation to support growth beyond FY '24. On the other hand, we will contain SG&A expenses to protect FY '24 performance, and we have reinforced our cost control process. Finally, CapEx. Cash flows from CapEx is expected around EUR 300 million, essentially reflecting capacity investment plan to support the growth beyond FY '24, in FY '25 and in FY '26. Of course, this investment plan will be deployed based on the visibility we will have on business for FY '25 and FY '26. Let's move to our financial model. As explained by Pierre, we have several very solid growth drivers with focus on value-added products with 2 main engines of growth. The semiconductor market growth impacting each of Swiss business, end markets and the adoption of new engineered substrates beyond SOI. The growth between FY '24 and FY '26 will be supported by the increase in sales of SOI product, half of this growth coming from volumes and the other part from ASP and mix as well as the adoption of compound product POI, SmartSiC and to a lesser extent, GaN. Our growth as well as being sustainable will continue to be more and more profitable as we are guiding our business to reach a 40% EBITDA margin in FY '26. From FY '24 to FY '26, will capitalize on stream and profitability drivers. First one, the operating leverage coming from higher activity. Our current SOI and POI fabs will be fully loaded in FY '26. Our Bernin 4 fab, mainly dedicated to SmartSiC will still be in the ramp-up basis. But will have the positive effect of the European industrial fundings that will compensate the effect of the underabsorption. Our extension in Singapore will just start. However, the under absorption will be offset by the performance of the other fabs given the productive size of our group. Of course, we'll continue to improve our industrial performance. Second profitability driver, ASP and third positive mix coming from higher value-added products. At the same time, we plan to reinforce our R&D efforts. This financial model is based on a EUR 1.10 rate. Remember that a change of $0.05 as a 1 point effect on our EBITDA margin. Overall, our EBITDA in value will double between FY '24 and FY '26. To support this growth, we need to continue to invest in capacity expansion. As Cyril represented just before, we only see a slight increase in the amount of CapEx communicated before. Our estimate for the FY '22, FY '26 period is now at EUR 1.5 billion, including the building, even if our Bernin 4 building will be financed through leaseback. Over this EUR 1.5 billion, we already deployed 30% in FY '22 and FY '23, and we plan to invest around 20% in FY '24. FY '24 will be our peak investment year. We are preparing for the future growth in FY '25 and '26. A key KPI for us to monitor the performance of our business model and our investment choices is a return on capital employed. In FY '23, post-tax return on capital employed was at 20%, meaning around 2x WACC. We anticipate a post-tax return on capital employed around 25% in FY '26. We'll find out our investments with the cash generated by our business. Beyond the strong level of EBITDA we anticipate, we'll continue to strongly monitor our working capital needs, and we are driving our business to be at an average rate of working capital on revenue below 30% in FY '26. We follow closely our inventory level and we try to find the right balance between inventory optimization and production agility. On the financing side, I would like to highlight that we have hedged the variable rate part of our debt. In terms of capital allocation, we will use our cash to finance our investments, to finance our innovation, and we do not exclude buying back partially or fully our convertible bond, OCEAN 25. Overall, our financial structure is already robust. And we have liquidity tools available, if needed, such as credit lines and the possibility of further drawing on our loan. To conclude, we achieved a strong fiscal year '23. FY '24 will be a transition year, both from a business and from a monitoring point of view as we are preparing to reaccelerate for FY '25 and FY '26. I will now hand over to Steve to open the second Q&A session. Thank you for your attention.

Thank you so much, Lea. So let's go to the second Q&A, I'd like to call Pierre and Cyril back on stage for this session. So once again, we will take questions from the audience and from the webcast. Maybe earlier, we started short. So maybe we can start here. Any questions?

Sébastien again, on your guidance because you are still guiding on a flat revenue for this year and flat margins and we have seen weakening trends on the smartphone market. It seems that maybe you have some boost that was not expected previously, maybe coming from new products ramping up. I'm seeing about maybe POI or FD-SOI. Could you explain a little bit how the adoption of these 2 technology is moving right now that would be quite nice. And the second question is on the pricing environment, could you help us understand maybe they are -- who do you see the prices trending in fiscal year 2024? And what was the price impact in the fiscal year 2023?

Then I'm going to take Sébastien. The first question is on -- under the stability of fiscal year '24, there are a lot of changes, a lot of dynamics. First of all, H1 to H2, Q1 to Q2, but underneath, if you look at the smartphone business that dropped last year and for which we have the inventory adoption to be done in this semester. We have different dynamics with RF-SOI, clearly declining before a rebound. But within these dynamics, Keep in mind that the footprints we are getting in the phones is increasing, especially in the high-end phones, first point. The type of substrates is also expanding RF-SOI, FD-SOI that is growing very fast and POIs that is taking off, as we said several times within the market. And third, I would like to say engines is 5G penetrations within the smartphone industry. Then under the stability and despite H1 to H2 discrepancies, we have engines within the dynamics that make us confident on the stability of fiscal year '24, taking into account last element that, as you understood, there are 3 divisions and automotive industrial as well as smart devices going to continue to grow steadily. Then all in one, underneath stability, a lot of changes, but a clear view to see this revenue around $1.2 billion for fiscal year '24.

On the other question regarding the pricing. So between FY '22 and FY '23, we don't see a significant increase in ASP overall, but we have various dynamics. We embedded some increase in ISP in some contract 200 millimeter FD-SOI especially, but it will be offset by other contracts on the RF-SOI part for which we were in the last year of the contract. They are over several years. So it was a contract signed much before I will see. Between FY '23 and FY '24, overall, the effect of ISP will not be very significant. We'll have some increase in ISP but offset by the mix. So we don't -- we cannot say that this is ISP having a significant effect on the gross margin between FY '23 and FY '24.

This is Aleksander in from SocGen. Just to reformulate a little bit the question that's Sébastien just asked. So I'd just like to understand, to what extent do you think that the smartphone market has to normalize in order to get to the H2 growth that you're currently anticipating? And a slight query is, what is your usual seasonality of H2 versus H1 over the past 2 years, I think it was about 30%. So this year's guidance is well over 50%. Is that something that we should expect as being normal or is there any risk attached to this forecast? And then a second point is just for full year. If you could explain exactly how much of your revenue is hedged and how much is -- are the spot rates so we can kind of model that if the FX moves around a little bit? And what is the hedging rate?

And on the smartphone business, what we see is the calendar H2 to show a rebound after the inventory absorption and then the kind of replenishment of the inventories to fulfill the needs, second part. And of course, ready for 2024 calendar, then this is what we see, meaning that starting on the H2 of this -- our fiscal year, we got to see starting this rebound, taking into account that Q1 will be the lowest point than Q2 for better and then this rebound. And of course, it's -- it will be not a normal, let's say, discrepancies between H1 and H2. You're right to say that between H1 and H2. Usually, we see 30%, 35% discrepancy, it will be clearly above 50% more in the range of 60% discrepancies. But we have the factories ready to absorb that. And it's going to mean that we're going to produce a bit more on H1 to be ready to absorb these additional rebounds to deliver on time what our customers are looking for with, of course, some mix in products that's going to be different compared to what we experienced in the past. I was talking about very strong growth in FD-SOI, across all the divisions. And of course, POI that is taking off very seriously, plus, of course, other products that are also in a very good shape.

Regarding the -- maybe before to answer on the hedging rate, just a reminder for everybody. So a large part of our revenue is in dollars, around 90% and half of our costs are in USD. We are hedging our net exposure basically, it means that we are -- that half of revenue is converted at the spot rate and the other half at the hedged rate. For FY '24, we hedge half -- we hedged 40% of our net exposure at a rate around EUR 1.12. So it means 20% of our revenue.

Okay. Next question, maybe.

Yes, 2 follow-ups. You talked about the EUR 1.5 billion of CapEx FY '22 through '26. And then Steve talked about Soitec TAM expanding by 3x. Is there any way we could quantify the revenue multiplier due to this investment through '26, like if you're investing EUR 1.5 billion and expanding the TAM by 3x, should we think about a revenue multiplier that this investment and TAM expansion could bring? And I have a follow-up.

I believe what could be interesting for us to stick to the ROCE ratio we described where we are targeting to be in the mid-20s by fiscal year '26. That is reflecting this kind of crossovers between the investment we are making, the increase in revenues. And then the fact that the more we're going to grow, the less in ratio we're going to invest the more we're going to generate cash. Then meaning that, of course, ROCE going to be clearly improved. And on the long run, we see also clear improvements. But it's very important to keep a certain level, a minimum level of investment in CapEx because, as you have seen, behind fiscal year '26, we see a lot of things to be done, a lot of market to be captured and that's also one of the clear engine, as I said, of Soitec is to bet on innovation and to invest massively on operations to really serve what is needed.

Sure. And then just a follow-up. There is a EUR 1 billion of incremental revenue '22 through '25. And as Steve talked about EUR 200 million attributed to silicon carbide. So 1/4 or 1/5 goes to silicon carbide. Is that a conservative assumption? Because given all the activity in silicon carbide and previously, you talked about how aggressively engage with prospective customers. How should we think about the conservatism dived into that EUR 100 or EUR 200 million-ish of incremental revenue?

Well, if we look at our target to get more than 30% of SmartSiC within the SiC market, it will -- it's going to drive to more investment in CapEx to sustain this growth for sure. Then of course, beyond the Bernin 4 capabilities, we just described we're going to think on having clear extensions in these capacities. Afterwards, we're going to look around the options. Take also into account that the revenue in SmartSiC will be mainly driven by wafers we're going to manufacture, but also some royalties coming from the licenses we got, and we expect STMicro to be extremely successful to bring also good royalties and licensing from the deliveries.

Yes. It's Adam Angelov here from Bank of America. So what do you think -- what's the feedback you're hearing from customers on silicon carbide in terms of what's holding them back from adoption or...

If you allow me, I would like Yvon Pastol, our salesman of course, to give you some flavors on the silicon carbide perception by customers.

Thank you, Pierre. So the traction on silicon carbide is very, very good. And we have demonstrated at every customer we have engaged. Technology works and again, we are very confident. Today, we have 22 customers engaged with us at several stages between evaluation, qualification of silicon carbide. And if we project the way this technology is going to ramp, it's going to be the fastest ramp in the history of the company. So again, we have a lot of confidence in our ability to bring this technology to market and to ramp it.

Okay. Just a quick follow-up. Do you think you could get to the silicon carbide revenue target you have with just the one customer you've already announced?

So we will have multiple customer by FY '26.

Jerome Ramel, BNP Paribas Exane. Just a quick question. You said capacity will move from 3 million wafers to 4.5 million. Revenues will move from $1.1 billion to $2.1 billion. So the ASP per wafer increasing by 30%. Is that just the impact of SmartSiC wafers?

Thank you, Jean, for the question. So basically, obviously, as we explained, I mean, our SOI 200 mm will be kind of, let's say, still ramping at a very low pace compared to the and SOI 300 and SmartSiC and POI. So I don't -- yes, in terms of pace, people in time of mix for sure, SOI 300, SIC and POI in terms of value is much higher compared to the SOI 200. And the SOI 200, I just want to recall that this represent today 1.45 million wafer out of 3 million, which is 50% of our total capacity and total revenue. For sure, this one won't grow because we didn't disclose any capacity upgrade on this one, and we will upgrade SOI 300, POI SiC and value is much higher compared to SOI 200.

I just want to ask about the addressable market, where you're going 3x by 2030 between FY '22 and FY '30, your revenues were $1 billion in FY '22. So directionally, what should we think about your FY '30 revenues? Is that 3x? Are you guiding to or should there be any market share gains, ASP increases, mix shifts, which should change that number one way or the other?

Well, as you know, we are not delivering figures beyond the fiscal year '26, then you do your math. I cannot comment.

Question. But the direction -- you're in the right direction.

It seems to be a good mathematicians, but I cannot comment more.

Alex.

This is Aleksander Peterc, Societe Generale. A follow-up on CapEx, we are getting now a little bit more CapEx than we thought before. Are they going to be a little bit less revenue by fiscal '26 than before as well. So there's a bit of a CapEx creep in terms of CapEx intensity. Could you in simple words explained. Is this a trend? Or are we still going to see a lower CapEx intensity in outer years? Question one. And then the second one would be more on the chips Act in Europe. We see STMicro, Infineon getting substantial funds for the new fabs? Are you guys part of any plans to have any CapEx indications from Europe?

So on your first question, Alex. So basically, the EUR 1.5 billion, obviously is a EUR 100 million higher than [ EUR 1.4 billion ] what most probably the target revenue for fiscal year '26 is something like 10% lower compared to what we announced last year. It's a really valid question. Thank you. So basically, we tried, obviously, to explain the reason behind and the driver for such a difference. Inflation is one. I'd say this is 1/3 of the kind of increase. The foreign exchange has an impact obviously in one direction for the margin, but it has an impact as well from a CapEx, considering that we buy part of it in USD, part of it in yen as well because the Japanese supplier has pretty high, let's say, the total addressable market on the different supplies that we get. And the third part which is important as well is that we believe that we have to reinforce our investment regarding sustainability, sustainability in order, for instance, when we move from LPG to electricity, it's better in terms of sustainability. It's better in terms of energy consumption because it's much more efficient. And even in terms of, let's say, robustness, we had some concern about the LPG some months ago. And we want to be sure that we will go in that direction, and this make our performance more robust for sure, be degraded in terms of CapEx intensity. I'm sorry for that. But robustness is important as well to deliver the value as per plan.

And regarding Alex, chips Act, there is a very strong ambition by European Union and the commissioner, Thierry Breton, I met on Monday and really bringing Europe back into the semiconductor industry. There were communication today where Soitec were quoted as one of the, let's say contender of the first batch of IPCEI subsidized. And of course, Bernin 4 is one of the recipient. But of course, it's a beginning. And even if we are not systematically, importantly, directly impacted indirectly, there is an impact very positively for us, as a call conclusion of the agreement on Monday, for EUR 7.5 billion investment is indirectly extremely fruitful for us because a large part of this factory will drive for FD-SOI based components, then you can imagine that, of course, it's an appeal to us and we are on the other side of the river. And it's really something very important for us. But as I said, we are navigating within global tensions. And of course, we're going to continue also to sell our solutions in the States, in China, everywhere in the world. That's our ambition.

We're now going to take a question from the conference call. Next question from Sandeep Deshpande from JPMorgan.

Can you just quickly talk about how you see your OpEx trending in FY '24, please? And then I have one quick follow-up.

Okay. So thanks for the question. Regarding the OpEx. On the gross margin side, as I said before, we see a flat gross margin as compared to FY '24. We will offset the effect of the inflation to our industrial performance. On the R&D side, we'll continue to invest significantly. But on the SG&A side, we'll contain the increase due to the cost control measure. We already implemented since now, I would say, more than 6 months. So overall, we anticipate a level of OpEx totally under control.

And my second question is regarding the pickup that you're seeing in the second half of the year. Can you talk about what your customer orders are at this point for the second half? To response to an earlier question, you said that you expect the market be better second half of this year, which will mean that your second half of your fiscal year will be better. Are you already seeing those orders coming in for the improved production that you would need to improve revenue performance that you will see in the second half of the year?

Yes. I have 2 parts in the answer to your question. So first of all, most of our revenue, about 85% of it is coming from long-term agreement with customers. And these have specific boundaries in terms of price, volume, duration and mix. So that's one part of it. Now if you look at our backlog for FY -- I'm sorry, if you look at our backlog for FY '24, 77% of our revenue is covered already.

Thank you, Sandeep. Yes...

Can we just come back to the millimeter wave story. It's got a bit quiet and the adoption of the technology hasn't been great. In the U.S., for example, Verizon has lost sort of interest, I think, is fair to say. So how much of your business plan is kind of dependent on millimeter wave adoption? And what assumption are you assuming within the smartphone market on millimeter wave?

And Jean-Marc, if you can answers on the 15% market share of millimeter wave. But beyond the also of adoption of other opportunities like WiFi 6, WiFi 6e, WiFi 7, that is also -- that are very important to understand the expansions of our footprint within the smartphones.

Yes. So obviously, there is already a first wave of, I mean, adoption of what wavers with the meter wave antenna in package. So you've seen that there are already a few phones in the market using the FD-SOI technology. I mean, first of all, thanks to MediaTek, to Samsung. The next wave is expected for next calendar year, addressing high ends. And then I mean in the future. The big question is the capacity of company. I mean going to adopt and which solutions they are going to adopt depending on the architecture. And then there is many options that I cannot really comment. But this will probably create another strong adoptions of meter wave technologies. Then in terms of -- I mean, I sure showed in the presentation showing where the Sub-6GHz will start to situated, and it will situate it in terms of capacity starting calendar '27 around 27 years. So the meter wave makes really sense. Of course, in the meantime, you could see that the C-band was adopted, for example, by Verizon. We still question ourselves. Will there be some competition by CY '27, '28 between next wave of meter wave and what [indiscernible] between 7 giga and 20 giga. So where our products already, I mean, fits very well, all of them, RF-SOI, FD-SOI, GaN. So -- and so the question is what about China? So China, today, we strongly believe that they will also adopt [indiscernible] technology, so we need it. Because this is [indiscernible]. So far, the spec are not defined, it's about substrate. And maybe you have seen in the press that some of our customers already announced some technology ready for meter wave using our substrate. So for us, it's not a question on how it's just a question of when and I believe it will happen definitely.

Just a quick follow-up on silicon carbide. I was hoping to answer this before. But in terms of SmartSiC, if you just take a very long term view, there are a lot of people in the industry that think silicon carbide is the kind of next sapphire that eventually the substrate production will move to China. So -- and commoditized. So are you willing to license SmartSiC today to Chinese substrate vendors because obviously, in a commoditization scenario, you'd probably rather get a royalty than build massive capacity in France. So is that something you're willing to do today?

Well, as you know, on the SmartSiC, we have already licensed STMicro that is clearly becoming #1 in the world okay, in the SiC, including in China. Then in the automotive industry, you need to be sure that the car manufacturers are getting systematically at minimum 2 suppliers. Then we have the 2 suppliers, SmartSiC, it should be good enough. And the technology is so advanced and so enabling compared to classical SiC solutions in terms of CapEx investment, in terms of concentrations of components, RDSON, in terms of sustainability that we do believe that SmartSiC will become a standard everywhere, including in China, but without having the opportunity to license it. We don't need on the paper and additional licenses.

Sébastien again from Kepler Cheuvreux. Following up on this question on silicon carbide, we are seeing -- so Chinese SiC substrate vendor coming to the market with low-cost substrates, talking about 20%, 25% discount versus the price of PolySiC, for instance. Is this something that could put pressure on the prices of your own SmartSiC substrates going forward or you are not competing there?

So as you can imagine, we are -- we need our supply chain, different PolySiC player and different MonoSiC player and we sample all of them in terms of MonoSiC to comprise is important and quality is important as well. So far, we don't see anyone having high quality and kind of competitive cost even in China. You have some Chinese player with a high quality, but believe me, the cost is not the same as a low-quality player with low quality. And this is on 150 mm and on further extent on 200 mm, the discrepancies, I mean, the gap is even higher.

Let's have a quick wrap up.

Thank you. So before Cyril and Lea, you can go back to your seats. So before saying goodbye, and saying thank you to [Foreign Language] and the IR team for this great event. I will leave the floor to Pierre for a few closing remarks. Thank you.

Thank you. And I will make it short because we are a bit late, but I would like to thank Steve, all the team for the organization of this event. I would like to thank the ExCom team who did a very good job, the speakers, but also Yvon, Caroline, Emmanuel, Pascal were there. And of course, all the team were in the team, welcoming you in the different workshops. Thank you for them. You see that Soitec is not a sole men company. It's a company of a lot of leaders, a lot of professionals and very genuine people. That's very important to underline it. Thank you to you for your attention. And also for the way you have absorbed immense amount of data's, I'm sure you can absorb it and you're going to get a lot of questions, and we will be more than happy to answer the thousands of questions you will have in the coming days and weeks. It will be my pleasure and the pleasure of the team. Just to -- in a nutshell, and if we take 5 key elements to help you to digest and to summarize. The first one is that we have -- I believe you have seen it. We have a clear vision and strategy on where we are going and how we're going to multiply by 3 our addressable market in the coming 7 years. You see it, you feel it everywhere across. So guys you have seen and you're going to meet later. Second, we have foundations -- strong foundations with our customers. Faithful, grateful customers. This time, I've asked Tom, Jean-Marc and [ Song ] for Samsung Foundries to make a testament. In 2 years from now, I'm going to ask Russell, Cristiano, Greg, Jensen, Pat. Okay, I know now to be part of this testimonial, okay? But just showing that we are in a long-term relationship with these guys. You heard it. And it's extremely important to keep that in mind. The third element is that we have a range of products that are totally amazing. Across the lines, you have seen the SOI family and on top of it, a SmartSiC family to come. So POI that is ticking off the revolutionary smart gun and more to come, anything on anything as a kind of focus point of our portfolio of products. So fourth element is that we have an incredible powerful model, operating model, innovation fueling operation -- operation fueling innovation, inventing at the edge producing massively to serve the 3 divisions, we have today 3 divisions, could be 4, 5 in the coming future, but today focusing on the 3 divisions to serve our customers, very powerful model, very powerful model, very efficient. And fifth point, I have the right team to deliver. I have the right team to deliver fiscal year '24, fiscal year '26 and going beyond. [indiscernible] because now we have a dedicated, simplified organization, they're going to make execution quicker, quicker but in quality. And with behind, as you've seen a very solid management team. As I said, Soitec is made of 2,200 talents really from the operators to the doctors. And we're going to continue to grow this culture in this mindset. Then thank you again for your attention and very excited to discuss with you in the coming days and weeks, all about our future and what we're going to bring to this market as added value, sustainable added value. Thank you very much.