Soitec SA (SOI) Earnings Call Transcript & Summary

Good afternoon to you in Paris. Good afternoon, good morning and good evening for those who are listening online. And thank you, everyone, for attending our Fiscal Year '24 Results Presentation. Very excited to have you with us today. The entire management is here to discuss our achievements and of course, talk about our future. Before we start, I will leave you with a second with a disclaimer. There you go. It's a long one. All right, here we go. So here's the agenda. So we have a lot to cover today. So if you know us, you know that typically, we organize a Capital Markets Day every 2 years. So the last Capital Markets Day was last year. So today is not properly speaking, a Capital Markets Day. We want to focus on the fiscal year '24 results. However, given all the important things that happened to us and to the industry over the last 12 months, we felt that it would be a good idea to have a quick check point on some of our key activities in terms of strategy, innovation, our 3 divisions, operations, of course. So without further ado, it's now my pleasure to welcome Pierre Barnabe, our Chief Executive Officer. Welcome Pierre.

Thank you Steve. And good afternoon to all of you in Paris and thank you for those who are joining us online for fiscal year 2014 results presentation. Today is a good opportunity for all of us to explain how we are navigating the current environment and how we are strengthening our fundamentals to deliver our sustainable growth story as the market progressively rebounds. I will start this presentation by sharing the key elements from our fiscal year '24 and my vision for the years to come. As you know, fiscal year '24 was a challenging year, impacted by a severe inventory correction across the smartphone supply chain. We are going through this challenging short-term environment with resilience and agility. That means strengthening our model, starting with our customers, pushing the diversification of our product portfolio, optimizing our cost structure and securing future growth through sustained investment in R&D. Our fundamentals are extremely robust. And we have a clear vision for midterm ambition to reach around $2 billion with significant EBITDA margin improvement, potentially towards 40%. Let's start with a look at the last fiscal year. Our revenue performance down 10% year-on-year, essentially reflects the ongoing inventory correction on RF-SOI across the smartphone value chain. At 34%, our EBITDA margin improves our resilience in the context of lower revenue. And finally, our lower operating cash flow reflects higher working capital needs in line with our delivery profile and our growing supplier base. Let's have a look at our division. In mobile communication, the growing penetration of FD-SOI and the acceleration in POI were offset by the impact of the ongoing RF-SOI inventory correction in the smartphone supply chain. In Automotive & Industrial, our strong growth continued to be supported by two powerful trends: digitalization and electrification, driving the strong momentum and the expansion of our product portfolio. In Smart Devices, the short-term softness in data center investment across market and lower smartphone volumes for Imager impacted our revenue generation. Across these 3 markets, the penetration of our product continues to rise and our market share remains very strong. What does it means for our outlook? In fiscal year '25, we expect our revenue to be flat with inventory corrections among our direct customers expected to wait on our H1 '25 revenue. An EBITDA margin around 35%, leveraging the positive contribution margin of new products and strict cost control. Our CapEx at around EUR 250 million, reflecting our agility in deploying capacity to match the customer demand. The current environment is challenging. We are using it as an opportunity to strengthen our foundation and to deploy our sustainable and profitable growth model as the ongoing inventory correction ends. More concretely, we are focused on investing in innovation and deploying capacity with agility, accelerating our diversification, strengthening our customer intimacy growing our client base and accelerating product adoption. Talking about product portfolio. We continue to develop a comprehensive range of silicon-on-insulator solutions, while some of them have become an undisputed standard. We continue to invest in R&D to strengthen our leadership in SOI solutions. On these solid foundations, we have decided to develop specific compound products for diverse applications such as POI for filter product showing significant traction, SmartSiC for the powertrain to enable the electrification of the vehicles. We have a clear vision to go beyond these strong assets. We leverage our expertise to ramp up compound manufacturing and develop new products. We have a strong ambition to expand our leadership and become a standard on new engineered substrates and product materials. The expansion of our product portfolio is a stronger driver behind the diversification of our customer base. Our SOI portfolio is qualified or in development with all foundries and IDMs, to address our 3 end markets with a strong segment share around 70%. On compound semiconductors, our customers are more numerous and diversified. They see us as a strong innovation powerhouse that enables breakthrough innovation. Every quarter, we are engaging with a growing number of customers. Today, we are serving 50% more customers than in fiscal year '21. We continue to strengthen our sustainable and profitable growth model. Our success starts in our ability to innovate at the edge of physics and to produce in high volumes with both quality and competitiveness. The strong intimacy between innovation and operation enables our division to deliver value to customers across the industry. Ultimately, this value creation benefits all our stakeholders, employees, shareholders, suppliers and partners, communities and of course, our planet. In this regard, we continue to deploy our sustainable model. Sustainability is a fundamental element of our strategy that matters a lot to me. On water management, we have recently announced a new industrial installation, allowing to significantly increase the proportion of water that can be reused in our industrial processes. On climate, we are on track with our CO2 emission reduction targets, and we have passed the inflection point of the curve. Our Scope 1 and 2 emission in calendar year '23 are down 15% year-on-year in absolute terms and already 3% below the SBTi target. Another very important topic is our people. We continue our efforts to make Soitec a workplace that attracts and develops its talent, emphasizing internal promotion and leading the industry on diversity achievements. Finally, on governance, we continue to raise the bar to reach industry-leading practices and standards. On that note, our Board of Directors decided to propose the appointment of Frédéric Lissalde for 3 years terms as Director at the next Annual General Meeting. Frédéric will bring experience at the helm of a global industrial company as well as a deep knowledge of the challenges around the transformation of the global automotive sector. We believe we have a fantastic ESG road map, and we are convinced we are taking the right actions to ensure the value we create is sustainable. As a proof point, I'm proud to share that we have improved our MSCI ESG rating from B to A in 3 years, acknowledging our steady efforts. The strong fundamental behind our value creation model give us great confidence in our $2 billion revenue midterm ambition. How we get there? Mobile Communications will continue to grow significantly, contributing to 50% of our bridge to $2 billion. We capitalize on the ongoing rebound of the smartphone market and the higher share of premium funds. We also see more innovation, both in terms of data rate and artificial intelligence and higher content growth for Soitec. Our F-SOI will benefit from the end of the inventory correction with our customers returning to significant growth and FD-SOI from more innovation. In addition, POI design wins for filters continue to increase, fueling our diversification beyond RF-SOI. The momentum on POI remains very strong in Q4 as we added another new customer in production for a total of 8. More broadly, the advent of AI will radically transform the way we use our phones and trigger the acceleration of smartphone replacement cycles. Moving on to auto, our fastest growing division. We continue to expect significant growth to be fueled by two powerful trends: digitalization and electrification. FD-SOI will benefit from the exponential growth of AI features, embarked on cars, enabling the structural progression in autonomous driving, infotainment and functional safety. Power-SOI will ramp to 300 millimeter, supported by a strong demand for battery management systems. Our latest product, SmartSiC is a fundamental enabler to the adoption of electric vehicles across the industry. We are proud to announce a third partnership on SmartSiC with X-FAB leading foundries. Together, we will begin working to offer our SmartSiC wafers to the extensive fabless network. Going forward, we will continue to gain new SmartSiC design wins to deliver on our ramp-up targets in line with customer satisfaction. Regarding Smart Devices. We will leverage the rise of artificial intelligence. On the edge, enabling the right balance between computing power and energy consumption for AI devices; in the cloud, where our Photonics-SOI product is a key enabler to new AI data center architectures. The ongoing advent of AI means exponential growth of computing power capabilities. The industry needs to deliver innovative data center architectures, while keeping the AI energy build sustainable. The next silicon photonics innovation wave will enable chip-to-chip communication to reduce latency and energy consumption. We are a unique, trusted partner in silicon photonics. And we develop innovative R&D road maps with leading fabless companies globally. Soitec is becoming a truly diversified company with the right product portfolio to address our customers' current and future needs, to reach our midterm revenue ambition at $2 billion. While mobile communication continues to be the largest contributor for more diversified products, Automotive & Industrial is expected to outperform powered by the growth of our current SOI product and the ramp-up of SmartSiC, expected to start in the second half of fiscal year '25. Smart Devices will continue to grow in line with Soitec's trajectory. We are strengthening our customer intimacy and building R&D road maps with key fabless companies globally. We will leverage the potential of Photonics-SOI for co-packaged optics to deliver new architecture for AI. Further evidence of the strength of our fundamentals, profitability. The significant growth ahead for us will unlock strong value creation with an EBITDA margin expected to be around 40% for revenue at $2 billion. Lea will share more details with you later on. With that in mind, I would like to hand over to my team in order to show the progress we have made in one year. It is my pleasure to introduce you to Steve Babureck, our EVP strategy.

Thank you very much, Pierre. And hi, everyone, again. So let's talk about strategy. Let's talk about growth engines and market opportunities. Between 2023 and 2030, we estimate that the size of our addressable market should more than triple, thanks to several factors. #1, solid growth in the semiconductor [Technical Difficulty] of our product portfolio. Reflecting at the semiconductor industry, it's clear that it's been a rollercoaster over the last few years. We've navigated geopolitical tensions, macroeconomic volatility, inflation, supply chain disruption, et cetera. But despite all these challenges, the megatrends, the technology megatrends are pretty much doing their jobs. 5G technology continues to be deployed globally. Electric cars are now produced by millions every month, and AI, of course, is already everywhere. So what's next? And what does that mean for all of us? This technology, this megatrend will continue to scale and impact on daily lives, especially in the second part of this decade. Gen AI has just entered smartphones and PCs. You can use ChatGPT now everywhere you go. That's good news. The low case is that Gen AI only boosts creativity and productivity at home and in the workplace. That's good for innovation. But the high case, it could be a revolution, new apps, new use cases, who knows. We could invent the next big thing in consumer devices for the next decade. In cars, same thing, it's a slow revolution on the road. The mix of 5G and AI will accelerate the development of fully autonomous vehicles. Safer cars will offer the driver decisions in real time. Going further, we should expect to see larger fleet of robotaxis in larger cities, especially in the U.S. and in China. And last, data centers, Pierre mentioned that the computing power is growing exponentially. It is critical, especially for this infrastructure, which are literally the electronic backbones of our daily lives. It's very important that these data centers continue to run faster and remain cost competitive. However, one of the pinpoint is electricity demand, which is growing way too fast and we will need to find more and more energy-efficient solutions for power supply for data centers. So what does that mean for semiconductor chips and especially engineered substrates? Clearly, we will need more and more better semiconductors with better performance. More and more semiconductor chips will require adopting engineered substrates to continue to push the limits. In mobile, engineered substrates provide better experience for the user, longer battery life and connectivity everywhere. In power applications, engineered substrates bring better reliability and safety, especially in autonomous driving, lower energy consumption and more autonomy for electric vehicles. For Edge AI, energy -- engineered substrates allow balancing computing power and energy efficiency to embed AI into all of our mobile devices. And last, in the cloud, engineered substrates can bring higher network speed, lower latency, lower cost and lower energy consumption. Our core business, engineered substrates, we estimate that it reached around 4 million wafers, 200-millimeter equivalent last year in 2023, and we expect this market to reach around 12 million wafers in 2030. Clearly, mobile communication should continue to grow fast and should remain our largest end market for smart phones, but not only -- it's also opening more and more for infrastructure, smart cities and satellites. This end market diversification should continue with higher growth rates and opportunities for Automotive & Industrial and Smart Devices. Looking at the same picture, but now by product. We split our addressable market between SOI and compound semiconductors. In SOI, where we have significant leadership, we estimate that the CAGR between 2023 and 2030 should be in the range of 15%. 15% is pretty much 2x faster than the rate of the semiconductor industry. On the compounds side, we expect even faster growth because of the adoption of new products and new substrates. In our product portfolio, we have POI for filters, SmartSiC for electric vehicles, for instance. This growth should be even higher, and we expect 30% between 2023 and 2030 on average. So for us, in order to capture these business opportunities, first priority is to consolidate our leadership in SOI, where we derive a very large share of our revenues today. Our objective is to maintain a segment share of around 70% high-volume manufacturing capacity and of course, strategic partnerships with customers and suppliers across our 3 end markets. Beyond SOI we need to accelerate and continue to develop at the right pace, our product portfolio into compound semiconductors with POI, SmartSiC, GaN and of course, new products. And this development will essentially be fueled by organic innovation and bolt-on acquisition when necessary. And so far, we've been quite satisfied with this first phase of expansion in compound [ semis ], especially with POI and SmartSiC. Last, our strategy, our innovation, our division teams are putting a great focus also on identifying new technologies, new types of engineered substrates to fuel growth across these trend markets, but also to go beyond these trend markets and potentially new ones, quantum computing, health care, leading-edge logic and much more. To conclude, 3 key messages. #1, megatrends are strong. They will continue to sustain a solid growth for the semiconductor industry. This growth obviously will not be linear, but they will drive and fuel content increase in every market that we serve. Second message, leadership in engineered substrates. Engineered substrates are critical materials to improve and enable new applications. We serve the increasing demand of engineered substrates to expand our leadership in SOI and beyond SOI. And 3, market expansion. We anticipate that our addressable market will triple by 2030 and to capture these opportunities, we must expand our product portfolio at the right pace. Now at the beginning of every growth story at Soitec, it always starts with innovation. And it is now my pleasure to introduce Christophe Maleville, our Chief Technology Officer.

Very happy to be here with you today. One year after our CMD, I'd like to come back to the innovation vision and share with you some of our key achievements. We continued to strengthen our leadership in SOI and compounds. Another 67 patent families filed this year, we have made decisive progress on our SmartSiC, and we are pushing the limits on our Smart Cut. Let's focus on our end-to-end approach to innovation, innovation that is at the heart of our value creation model. Now how do we proceed to actually bring products to market? First of all, we work closely with the end user to understand their challenges. Then we take the best out of each single layer of material and combine their properties into one compelling solution, one engineered substrate using our toolbox of processes. Our innovation creates differentiation only if we operate with speed, which means focusing on priorities and efficiency and, of course, leveraging our prior experiences to bring compelling products to the market in a record time. This model has allowed us to expand our Smart Cut process to multiple semiconductor materials, opening up the field of possibilities to device makers. We are strongly investing in innovation, structurally more than 10% and specifically 14% this year as a fundamental lever to secure our growth mid and long term. My responsibility as a CTO is to be very thorough in strengthening our leadership and creative in defining what comes next to fuel our expansion. We allocate 80% of our resources to support our current business plan, and deliver next-generation products in SOI and compound semiconductor. And we allocate 20% to address the challenges our industry will face beyond this plan to strengthen Soitec leadership and enable our segment share expansion. This last part is the very creative part of our R&D investment, where we allow ourselves to experience and push the limits of our toolbox to invent potential new solutions such as SOI for new application, and it could even relate to advanced logic, SmartGaN and many more exotic compounds. This brings me to our anything-on-anything table, which illustrates what our toolbox enables us to deliver. It shows you our strengths, our ability to combine different materials to create differentiating substrates. All of these wafers are combinations we've been -- we've demonstrated, combining the best active layer with the range of functional substrates we have used so far. Behind each of these wafers, there is multiple years of R&D, numerous patents and secret recipes. With all of these assets in the bank, we can innovate faster, better and bring unique added value engineered materials to the market. Innovation is what allows us to strengthen our leadership in SOI and support our expansion beyond SOI into POI and compounds. The innovation team of more than 250 researchers and whole Soitec employees have been again very active this year, pushing the boundaries of engineered substrate performance and innovating into new materials. A great example to illustrate our innovation strength lies in one number, 377. This is the number of patents we filed this year, including 67 new families that we deploy across region. We ranked #1 among midsize companies in French patent filers and 25th overall. We have been ranked among the top 50 patent filers for 7 years in a row. And I monitor our efficiency with great scrutiny on how many patents we filed per euro invested. We talked about how crucial speed and efficiency are. SmartSiC is a good example on how we are innovating fast. We brought it from idea to pilot products in a record 4 years, and we keep moving fast. We inaugurated the fab in September and successfully transferred 150-millimeter into production on time, with value now endorsed by 3 customers. We are now working on 200-millimeter SmartSiC and on developing next generations, focusing on ultra-load effectivity and resistivity for higher power applications. The second update I'd like to share with you is our SmartGaN. We introduced this innovative concept to you in June last year. Since then, we've created SmartGaN internal incubator, an internal incubator to align the product value proposition with market needs to accelerate technology maturation and structure for future volume production. We are here leveraging the know-how and experience we gained with SmartSiC, targeting lateral GaN HEMT applications, namely power devices up to 1200 volt, lateral GaN for high-frequency RF devices and high-power vertical gallium nitride devices that will require further improvement in crystalline quality of gallium nitride device layer. Bringing SmartGaN to the market will enable more aggressive road maps for gallium nitride material. We ambition (sic) [ audition ] the first pilot product around 2027. To conclude, 3 messages I would like you to remember today. 1, innovation is at the heart of our value creation model and the engine allowing us to strengthen our leadership across 3 end markets, gained segment shares and potentially expand into new markets. #2, we constantly invest significant resources in R&D focusing on speed, efficiency and strategic partnerships. And #3, Soitec is SOI and more than SOI. We continue to push the limits of SOI, bringing new generations of product year-in, year-out. And we go beyond new generation of POI, new generation of SmartSiC and new engineered substrates. And we are now creating incubators to accelerate our innovation and priority topics. We innovate for our customers and our divisions, which is why I have the pleasure to routinely work with our 3 heads of divisions. Let me introduce you to one of them, Jean-Marc Le Meil, Head of Mobile Communications. Thank you for your attention. And Jean-Marc, the floor is yours?

Thank you, Christophe. Hi, everyone. Today, I'd like to discuss the current market environment for mobile communication and the reasons to be optimistic. In particular, I show you how our ongoing diversification put us in the right position for the future as we are making progress in the current onset inventory correction. My division leveraged 3 long-term growth drivers. Consumer applications, which are rooted to the deployment of 5G, 5G advanced and [ CG ] as well as the future of WiFi road maps with WiFi 6E and 7. Smart connectivity, again, thanks to 5G advanced new IoT protocol. It will address smart transportation, smart cities and smart industries. And last, new infrastructure will support this growing need for communication capacity. Let's start with the smartphone market overview. So smartphone market did not grow as expected across the industry after COVID-19. That was a disappointment, clearly, for all of us, but over the same period, the demand for RF-SOI was much higher than the performance of the smartphones market. Customers were building inventory just in case instead of the usual just in time pattern. So when we combine these 2 parameters, it created a significant inventory across the value chain. This inventory situation is now improving. Downstream at the onset level, at the fabless level, but also [ and a key ], at the foundry level. We see it attested to improve. Consequently, on our side, with 6 months lag, we will reach the bottom of this major inventory corrections in this current quarter, Q1 fiscal year '25. For 2024, 2025, we remain cautious. And we forecast low-single-digit growth in the smartphone sales. 5G deployment continued to progress well in line with expectations for 2 reasons. The second wave is coming through 5G advanced and the equipment of new regions, such as India, APAC and Africa is accelerating. In this context, Soitec remains a content growth story, driven by increased innovation within the phone, new smart phone applications as well as expansion beyond mobile. We also believe AI will enable new ways to leverage connectivity and communications. Our strong customer intimacy and our innovation capabilities allow us to strengthen our leadership in the mobile innovation road map with new product introductions like advanced FD-SOI in IT, low-band POI and GaN-on-Silicon. This brings me to our product portfolio. At Soitec, we developed a comprehensive set of solutions to address our customer needs and to tackle the market challenge. RF-SOI is the standard, integrating in 100% of the 5G smartphones and will remain the standard as well for WiFi applications. So good news is that FD-SOI adoption, of course, due to it's performance is progressing very well. With a growing number of smartphones integrating every technology, such as the latest Galaxy S25 and the Google Pixels. GaN-on-Silicon is also a good fit for higher frequency. It will address FR-3 bands, so-called sub-20 gigahertz with some benefit in terms of linearity, energy efficiency and output power. Finally, POI adoption is strongly picking up. As mentioned earlier, in Q4 '24, another customer has moved to production. Total 8 customers have now adopted our POI substrate. We continue to see strong traction from China, and we are engaged with all leading U.S. fabless. This megatrends and the growing penetration of our products translate into a content opportunity in FY '26, almost tripling its level of FY '21. The RF-SOI ratio is moving from almost 100% to less than 50%, illustrating the diversification of our product portfolio. Going forward, we'll continue to strengthen our unique position in mobile communication by further penetrating switches, LNA, tuners with RF-SOI. By making RF-SOI as our mainstream technology for mmWave SoC, and by ensuring POI adoption across all tier 1 fabless customers for mid-high band, but also low band filters. And we continue to work on further diversifying our serviceable market into new infrastructure systems like fixed wireless access and nonterrestrial networks. To do so, a strong customer intimacy is elemental to ensure we develop the right solutions with the right partner, to be the #1 and the benchmark in our field. And that is something reinforced on a daily basis. To conclude, I have 3 messages to take away. First, again, we have a strong position in the smart phone market, which is recovering. We expect to see greater penetration of premium smart phones, again, thanks to the new AI use case to drive overall the semiconductor content growth. Second, we are diversifying our portfolio beyond RF-SOI and in applications as well beyond mobile. Third, the intimate relationship we have developed and continue to reinforce every day across the entire supply chain are powerful levers to ensure we remain leaders in this market, but also to increase adoption, standardization and expansion of our solutions well beyond mobile. I will now leave the floor to Emmanuel to address the opportunities in Automotive & Industrial.

Thank you, Jean-Marc. And hi, everyone. It's a real pleasure to share with you the results and the road map of the division Automotive & Industrial. This year, we overperformed the market in fiscal year '24. Because we have leveraged the 3 main megatrends, the first more digitalization in the car, more electrification in the car and development of charging infrastructures and renewable energy. For the first one, we see the car more and more digital, more and more autonomous and safer to prevent accidents and cyber attacks. Second, EV penetration targets remain strong and boost the adoption of power devices and modules. We are entering in a sudden [ brief ] of the EV with more mass market and more and more -- and this year, 14 million EVs were sold, which is 35% growth. Finally, the development of charging infrastructure and the [ most indeed ] transformation of the renewable energies to set accelerated significance and drive higher demand for power device. But let's focus now on the semi content of this growth. We see in Automotive, the growth 10% annually. And this is for the next years. This growth is driven by infotainment in vehicle networking, the power management systems and the applications, which have delivered 5% growth over the last decade. It's now completed and accelerated with the ADAS systems. And because there's more EVs, there's more semi content inside. As a EV penetration, it's probably slightly slowing down. But keep in mind, we are coming from a 35% growth, and we are speaking in about 20% growth for the next years. And in this market, the dynamic of silicon carbide is very strong. The penetration growth is moving sector by sector, segment by segment of premium, which will be probably fully silicon carbide, the midrange with increasing numbers of silicon carbide inside, and even the entry range are also driving silicon carbide into the cars, which means 2025, 50% of silicon carbide, hydrogen and 70% for 2030. How do we address these trends? What is our product portfolio? We have developed the right products in the right time to touch the market we want to have. Whether it is electric or not, Soitec delivers differentiated and value solution for the system, the power SOI first. So power SOI is more robust and efficient than bulk silicon. In particularly suit with a wide-bandgap devices and is gaining traction in battery management systems. FD-SOI is a perfect fit for Edge AI into the cars. And we see -- and because they have the lower consumption in terms of a fit [ fab ], it's a perfect fit for the car industry. We see today the radar as a first application, and they are behind the [ ADAS ], some deep learning system already running into the cars today. SmartSiC is a greener, faster and better technology than the single crystal silicon carbide. Allowing for at least one generation gain in power device, accelerating the 200 millimeters for the liters and increasing by at least 25%, the numbers of good dies per wafer. Finally, and Christophe said a word about that. We are thinking about SmartGaN also to complete our portfolio. It's still in R&D, it's still under incubator, but SmartGaN can could be a promising way to address the bidirectional charging home to car, car to home in the future. We have a clear vision how to grow this automotive market. We are strengthening our customer intimacy to accelerate the adoptions of our game-changing device and solutions into one of a century transformation of the car industry. And for the green industry revolution for the planet, we also are pushing our solutions. Looking ahead, the robust adoption of our SOI products will significantly contribute to the revenue growth with a growing appetite for Power-SOI already demonstrated this year, and FD-SOI, which become mainstream for the more AI -- Edge AI into the car. We are delivering on Soitec expansion goal with new wide-bandgap semiconductors with a successful deployment ongoing for SmartSiC toward more than 30% of market share as a standard expected in 2030. Here, let's talk about SmartSiC a second. We are very pleased and very proud to announce the partnership with X-FAB. X-FAB is a pioneer and leader in the foundry models into the fast-growing silicon carbide market. X-FAB will provide access to smart SIC technology to the fabless customers. There are a lot of them in the U.S., but also internationally. The adoption of SmartSiC is progressing as planned. And with Soitec, we have and we know the recipe to make standard into the market. Jean-Marc showed it, and we did it in our [ FSOI ] in the past. The fact that we are able to demonstrate that in each of the market segments, our technology as a value-add and a value proposition is absolutely the right path and the right way to make this technology as a standard into the market. And this is what is behind this X-fab announcement. Obviously, this is only the beginning with the SmartSiC. And we are in our ramp towards the 500k wafers we are targeting in our new fab in Bernin. So growing adoptions and of our products and customers, we address different markets. Here we measure them in square millimeters. So powertrain and power systems for car and green industry, infotainment in vehicle and networking for the car and inside the car and ADAS and functional safety for more intelligence into the car. So as a nutshell, and my takeaway is, one, a powerful megatrend. We leverage growing digitalization and electrifications to deliver steady growth in our markets. Second, customer intimacy. We continuously reinforced our customers intimacy to ensure adoptions and optimize the go-to-market for our solutions with the foundries, the IDMs and the OEMs; and 3, the right product portfolio. We have developed comprehensive and differentiated product portfolio within the right time in SOI and in wide bandgap and enables more autonomous and safe cars, while powering the transition for greener systems. Thank you very much. And I hand over to René, Head of the Division of Smart Devices.

Thank you, Emmanuel. Hi, everyone. I'm René Jonker, and I'm heading the Smart Devices division. As this is my first time in front of you since I took over the division recently, let me also share a few elements of my background. So I joined Soitec about a year ago as Head of the FD-SOI for Smart Devices. I have more than 20 years' experience in the semiconductor industry, with an extensive background in semiconductor manufacturing and a strong drive for quality and process improvements. I've worked in Asia, in Europe and in the U.S., collaborating with international teams. More specifically, I've spent more than a decade working for NXP with different positions from innovation and design to various leadership roles in the business units. I also held different leadership positions in Nexperia, which is a spin-off of NXP. And I've been leading operations for the internal back-end equipment manufacturing organization. And I spent 4 years working for ams-OSRAM as Operations Manager for Automotive. So I'm bringing with me a strong application background with chip design experience, which helps reinforcing our intimacy with the decision-makers in our value chain. I'm trying to leverage my end-to-end experience in the semiconductor industry to pilot Soitec Smart Devices division. So I'm very excited about the growth prospects from my division, and today is a great opportunity to tell you more about the why. The advancements of AI boosts the application of sensors and drives the growth in Edge AI and Cloud AI. Sensors proliferates with more and more energy consuming functions and miniaturization specifications. The growth in AI is happening at the Edge as well as in the data centers. The ongoing acceleration of AI pushes existing technologies to their limits and implies the need for new technologies. 2 megatrends are driving the growth for the division. The first megatrend is the proliferation of Edge AI devices. So AI is going to the Edge with more compute power and sophisticated functions. Specifications are challenging, targeting low latency, improved power efficiency, enhancing user experience and securing a better privacy. Compute at the Edge demands low-power consumption devices. The second megatrend is the use of silicon photonics in data centers. Low latency and the low power consumption requirements imply high bandwidth connections using silicon photonics. Connectivity will move from pluggable optics to so-called co-packaged optics, CPOs. The exponential data center growth pushes the need for high bandwidth connections. To push the limits of existing technologies and accelerate AI capabilities, we are leveraging Smart Cuts across our product portfolio. FD-SOI is driving energy efficiency for sustainably-aware electronics. The growth of smart FD-SOI is now and continues to highlight industry-leading merits. Performance on demand can be boosted by up to 25% with power management features such as body biasing. Imager-SOI addresses the secure 3D facial recognition by offering reduced readout noise, improved sensitivity and increased image resolution. Photonics-SOI is now a standard technology platform for high speeds and high bandwidth optical interconnections in the data center. It is adopted in pluggable optics transceivers, and it is the platform used for the development of co-packaged optics. In order to answer the AI and machine learning, demand for [indiscernible] speed in data centers, the electrical connections are replaced by optical connections at different levels in the data center. Photonics-SOI is a standard for the fabrication of pluggable optics and Soitec is a leader in both 200 and 300 millimeter. In the future, co-packaged optics will connect the optical fiber even closer to the IC. Key benefits are a lower cost, estimated to be 40% lower and power savings estimated to be 30% less. Leading fabless have already started to commercialize CPO on an SOI platform. Exciting prospects for the division, where we have a leading position as a supplier for FD-SOI, Photonics-SOI and Imager-SOI, we expect the division revenue will roughly double in the midterm. We can consider 3 waves for the FD-SOI product adoption. We are currently on the first wave with strong 22- and 28-nanometer adoption for microcontrollers dedicated to machine learning and Edge AI influence. For example, in smartphones, smart cities, wearables, hearables. The second wave is the 18-nanometer nodes, which will bring better performance to power ratio, larger on-chip memories and increased digital peripheral density. Advance node FD-SOI has already been endorsed by key foundries and IDMs evidenced by recent announcements around capacity deployments and product adoption. Beyond 18 nanometer, we are already working on next-generation of FD-SOI to bring further scaling and improved performance. Photonics-SOI is a key enabler to AI in the data centers, enabling higher data rates and sustainable energy consumption levels. Photonics-SOI is already adopted in 400 gigabit per second pluggable optical transceivers. It will be more largely deployed with optical transceivers up to 1.6 terabit per second and beyond. The demand will increase, thanks to data center proliferation and the need for high-speed transceivers. The wafer size will shift the 300-millimeter, where Soitec is a leading supplier. The next silicon photonics innovation wave on Photonics-SOI will enable highly integrated silicon photonics and CPO solutions, further reducing latency and energy consumption. Imager-SOI Gen 1 is adopted for secured facial recognition in smartphones. And Gen 2 for event-based imaging is under development and will extend our market coverage beyond mobile devices, into applications like Industry 4.0, AR/VR devices and Automotive. I think we all agree on one thing. AI has started to transform our daily lives, and we have just seen the beginning. AI, whether it happens on the Edge or in the cloud, is a strong megatrend powering the Smart Devices division activities. Thanks to the strong collaboration and technology codevelopment with foundries, IDMs, fabless and OEMs, we have enabled our long-term revenue generation. And this will end my remarks. Thank you for your attention. We are switching gears to operations. Cyril?

Good morning, good afternoon and good evening to all of you. In the past 5 years, the 2 most dynamic growth drivers were SOI 200-millimeter and SOI 300-millimeter. Going forward, our growth will rely on 3 major pillars, to serve our 3 divisions. SOI 300-millimeter, which remain a significant driver. We have our fab in Singapore, 150-millimeter POI in our fab of Bernin 3 and 150-, 200-millimeter SmartSiC in Bernin 4. In the next years, we will install additional capacity for a total of EUR 750 million to support the business acceleration. Our industrial footprint became global with the addition of our Singapore facility. With the extension of Bernin 4 for SmartSiC and Singapore for SOI 300 mm. We are leveraging our expertise and know-how to achieve scalability for our business and agility. I'll come back on this. We will increase our capacity in both POI and SmartSiC, respectively, up to 700,000 and 500,000 wafer per year in Bernin. As a reminder, both POI and SmartSiC in Bernin 3 and 4, are highly flexible on 150-millimeter and 200-millimeter. Talking about SmartSiC, we announced yesterday a new partnership for poly-SiC with Tokai to strengthen our SmartSiC road map. We have built a robust ecosystem with a focus on maintaining our competitive edge. At the same time, we adjust our extension in Singapore, Pasir Ris 1A, to customer demand. We continue to foresee a EUR 1.5 billion for our current investment cycle. We have already invested EUR 750 million. We will deploy another EUR 750 million to address the following topics: the strengthening of our 300 mm SOI capacity; the expansion into compound semiconductor with both POI and SmartSiC; the next wave of expansion of our product portfolio with SmartGaN and other innovation projects; and our ongoing effort in ESG, IT and automation projects. 15% of our upcoming investment support the expansion of our 300 mm building in Singapore. As for the equipment, we will deploy CapEx in line with customer demand. The amount of our investment in fiscal year '25 will be around EUR 250 million. Addressing such growth challenges require ambition. And at the same time, we must keep our fundamental base on a rational approach and agility. We have built a scalable and agile model. Here is why? First, we rely on fab extensions to leverage our existing footprint and accelerate qualification, avoiding longer-time anticipation. Our second pillar relies on margin protection. By leveraging our assets at the earlier stage. For example, we combined new business introduction with the immediate benefit from a large 300 mm refresh activity, lowering breakeven point of new activity such as in Bernin 4 [ these days ]. Third, we have the ability to create synergies by sharing resources in the same organization such as Compounds semi operation in this slide. This helped to create agility between organization to adapt to the different business dynamics. Finally, we continue to scale up by improving our fab performance with state-of-the-art fab automation, scheduling an AI to improve our productivity, yield and ultimately, quality. As Pierre pointed out earlier 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 significantly while reducing our carbon emission, according to science-based target initiative. As a result, our revenue has grown by almost 70% since 2020, while our Scope 1 and 2 carbon footprint is similar in absolute value. We are strongly engaged in dividing our water intake by 2 in Fiscal '30. Recycling more water will be fundamental. Here, we have reached our long-term target and decided to raise the bar to 50% recycled water by 2030. We are using 100% of low carbon energy commitment. Finally, we are aiming at reducing transportation needs through supply chain optimization. Sea freight is now our first transportation choice and that allows us to divide our internal freight emission by 4. We are [ through ] for the finance section. Let me wrap up my part on operation. One, Soitec operating model is scalable, designed to preserve its agility and realize on a larger ecosystem. The ability to execute on time, such as the delivery of our SmartSiC fab as per schedule will enable us to scale up and deliver more than 4 million wafer reaching our midterm ambition. Second, I reiterate we'll always be wise when investing in manufacturing, which are very much about efficiency and flexibility to adjust the customer demand, including CapEx management and supplier contract management. And finally, we care about our people. We are at the core of our daily attention to deliver sustainable growth with ambitious objectives on water management and carbon emission reduction. Thank you very much. I will leave the floor to Léa, our Chief Finance Officer.

Thank you, Cyril. Good afternoon to all of you. Fiscal year '24 has been a challenging year in terms of visibility and performance management. Before commenting on our FY '24 results, let me share 3 key messages with you. First, we expect FY '25 to be a transition year, and we are preparing for reacceleration in H2 and beyond. After 2 difficult years in the smart phone market, we continue to feel the impact of the inventory correction at our customers' level. And we are confident that our diversification strategy is paying off, both for markets and for products. Second, to support this strong sustainable and profitable growth, we need to continue to invest at the right pace. And third, we expect our EBITDA in value will more than double in the midterm as we accelerate value creation. Now let's move to the FY '24 results. The main highlights are: we delivered a revenue of EUR 978 million, down 10% year-on-year. In this context, we reached a resilient 34% EBITDA margin, enabled by efficient cost management allowing us to sustain a high level of investment in R&D. Our free cash flow was at minus EUR 43 million due to capacity investments to prepare upcoming growth and an increase in working capital. Pierre already commented on the revenue performance, so let's move directly to our gross margin performance. We delivered a solid gross margin of 34%, thanks to strong industrial performance with improved yields and agility in resources allocation between our fabs. A highly effective cost control, including the renegotiation of some of our raw material long-term agreements to minimize the effect of the inflation and to manage volumes. And we also had a favorable effect of subsidies. Our resilient model allowed us to absorb several headwinds in FY '24. Higher depreciations, as expected, slight underutilization of our SOI fabs, inflation and a lower revenue, as explained before. Let's move now to the current operating income, which reached EUR 208 million, 21.3% margin, 3 points lower than last year. We continued to significantly invest in R&D to support our strategic priorities and our gross R&D expenses before capitalization were up EUR 15 million, representing 14% of our revenue. We remain focused on reinforcing our technological leadership in each of our 3 end markets and across all product lines. Taking a longer-term view, we are also increasing our efforts in upstream R&D, [ our entitlements ] and continuing to build collaborations with innovation platforms. At the net R&D level, we benefited from an increase in subsidies thanks to the signing of a new European agreement. SG&A expenses are down EUR 8 million, a 12% decrease year-on-year. This is a result of strong cost containment actions. Labor costs were contained, thanks to cost management, the decrease of compensation items as well as nonrecurring tailwinds. And we continue to invest in automation to secure our future competitive edge. Finally, our 34% EBITDA margin was pretty much in line with our gross margin, non-EBITDA items being offset by SG&A and R&D expenses. Net profit. Net income reached EUR 178 million, representing around 18% of our revenue. Our financial results improved, thanks to the higher income from cash investments which more than offset the increase in financial expenses. Finally, our income tax continued to benefit from tax loss carryforward. Free earning cash flow. We generated EUR 165 million operating cash flow compared to EUR 262 million last year. This decrease was due to a lower EBITDA, as already explained, and a higher working capital at EUR 142 million. Let's spend some time to look at the key moving parts. First, EUR 19 million from inventory, mainly due to a lot of changes in customer demand over FY '24, leading to additional raw material inventory at the end of the year, driven by lead time for supply. Second, EUR 94 million in trade receivables due to revenue seasonality with a large last quarter, including a very high March month, combined with an unfavorable customer mix. As in the previous years, receivables [indiscernible] EUR 45 million in trade deduct -- decrease in trade payables due to nonrecurring down payments to suppliers. [indiscernible] exceptional down payments to suppliers. We continue to strongly manage our working capital in order to come back to a normalized level that I will comment on later on. Let's continue with cash from investing activities at EUR 208 million, which are split between EUR 276 million cash out from CapEx, slightly below our guidance of around EUR 290 million as we adjusted investments based on customer demand. This was partially offset by EUR 50 million of leasing contracts and EUR 17 million of cash in from investments. So where did we invest our CapEx? In Singapore, for 300-millimeter SOI production. In France, in tools and facilities for SmartSiC and POI as well as for the internalization of 300-millimeter SOI refresh capacity. And we also had ongoing investments in innovation, sustainability and automation. As a consequence of our sustained investments, free cash flow was at minus EUR 43 million compared to a positive free cash flow of EUR 34 million last year. Net debt now. We ended the year with a strong EUR 708 million cash position and a moderate net debt at EUR 39 million. Beyond our cash consumption, this reflects EUR 59 million related to the leaseback contract for our new SmartSiC FAB and EUR 50 million of leasing contracts for tool. Finally, our balance sheet remains very healthy with improved equity and low net debt. This concludes my comments on FY '24. Let's focus now to the future on our FY '25 guidance. FY '25 remains a transition year. Let me give you more details on our confirmed guidance. First, revenue. We anticipate FY '25 revenue to be stable year-on-year at constant exchange rates, with different trends among our divisions. In mobile, while maintaining our market shares, we continue to expect a strong inventory correction during the first 2 quarters, impacting mostly our RF-SOI business. First positive signals from OEMs and fabless fuel our confidence in the H2 rebrand, but inventory level for some customers, especially the foundries remains high. Weaker RF-SOI revenue will offset the strong acceleration of POI sales. Our declining mobile revenue will be compensated by growing semiconductor content in cars with increased electrification and digitalization supporting growth of our Automotive division. And the dynamic around artificial intelligence both in the cloud and at the Edge for our Smart Devices divisions, mainly. We anticipate H1 total revenue to decline at constant exchange rates by around 15% year-on-year with a bottom point during our first quarter close to around minus 25% year-on-year, followed by a strong acceleration in the second half of the year. We'll continue to closely follow the visibility, especially on this RF-SOI business to further adjust our costs and our supply chain, if needed. Let's move to the second part of our guidance, profitability. We expect to hit our gross margin to still overall at -- in the same range as in FY '24, thanks to a more favorable product mix, a solid operating performance. And on the headwinds side, we will face the effect of the capacity increase for POI and SmartSiC in FY '25. On the other hand, we'll continue to manage SG&A expenses to protect FY '25 performance with a strong cost control process. Finally, our investment. Cash flow from CapEx is expected around EUR 250 million, mainly reflecting capacity investments in Singapore for 300-millimeter SOI. In Bernin, for SmartSiC and POI tools and facilities and also ongoing investments in innovation, sustainability and automation projects. As usual, this investment plan will be deployed step-by-step based on the visibility on the demand. Let's move now to our midterm ambition. We disclosed at the end of March that we will stop providing FY '26 financial targets. Nevertheless, we are confident in our engine of growth for the midterm. The growth between FY '25 and our midterm ambition at $2 billion will be supported by, 1, the increase in sales of SOI products, especially with the recovery of the smart phone market and the growth of Photonics, Power-SOI and FD-SOI products driven by the semiconductor market growth. Second, the growing adoption of compounds product POI as SmartSiC. Our growth will continue to be more and more profitable, and we are driving our business to reach around 40% EBITDA margin for this revenue of $2 billion. We'll capitalize on 3 main profitability drivers. First one, the operating leverage coming from higher activity. Our current POI and SOI fabs will be fully loaded for this level of revenue. And we'll continue to improve our industrial performance with a target to offset inflation effects. Second profitability driver, positive mix coming from higher value-added products. And third, higher ASP in a more favorable economic context. At the same time, we plan to continue to sustain a high level of investment in R&D to maintain our competitive edge. This financial model is based on the EUR 1.10 [ to the ] dollar. Remember that a change of EUR 0.05 has a 1 point effect on our EBITDA margin. Overall, we expect our EBITDA [ end ] value will more than double between FY '24, and this midterm ambition. To support this growth we will need to continue to invest in capacity expansion. As Cyril just presented, the amount of remaining CapEx in this investment cycle is expected around EUR 750 million. FY '24 was a peak investment year as we are preparing for growth acceleration in FY '26 and beyond. Of course, we'll continue to adjust investment based on the visibility on customers' demand. We already adjusted the timing for our fab extension in Singapore as well as for some 300-millimeter SOI tools versus our previous plan. A key KPI for us to monitor the performance of our business model is a return on capital employed. After FY '25, that will still be low. We then anticipate a ROCE between 22% and 25%, improving both versus FY '24 and FY '23, thanks to the operating leverage and the working capital improvement. We will finance our investments with the cash generated by our business. Beyond the strong level of EBITDA we anticipate, we will continue to strongly manage our working capital, and we are driving our business to be at the rate of working capital around 35% at midterm. In terms of capital allocation, our priorities are clear. To finance our CapEx plan, to invest in our innovation, and we'll manage our convertible bond OCEANE '25 with a maturity in October '25 based on market conditions. Overall, our financial structure is robust, and we have liquidity tools available, if necessary, including not used credit lines. To conclude, you can see that we maintain a strong level of profitability despite the decrease in revenue, and we continue to invest for the future. We are taking actions on all the items we can control, such as operating expenses and CapEx. And we are well prepared for the market rebound in H2. I will now hand over to Steve to open the Q&A session. Thank you for your attention.

Now let's get into the Q&A session. So we'll take questions, of course, here from the audience. We have some questions on the webcast, and we'll take some questions also online. So maybe first question, the audience.

Emmanuel Matot from ODDO. So 3 questions for me, please. Why have you decided not to give any more clear deadline, Pierre, for achieving our $2 billion sales model? This may come as a surprise because you are saying that destocking should come to an end for RF and that product diversification is going well. So that implies for me a better visibility and, no more deadline. So that's my first question. Second, regarding RF, excluding customer destocking, would you say that growth drivers have not changed? What should be the normative sales growth for that product with flat volumes of smart phones and I would say, continuous penetration of 5G? And last question, if I may. Are you concerned by the downturn seen by some semiconductor companies in automotive and industrial. Do we have...

For the question number one, we are changing our model because exactly what you said, we are more and more diversified. Then we used to have in the past years a model that was one product, very limited list of [ planned ] geographies. You remember what I said several times, a few customers who are making 90% of our revenue in [indiscernible] confirming that our engine for growth are very strong, and that we have the ability to look at each of these product and each of these customers and business to make it happen. Then that's really the diversification that makes us stronger, but with a view that is midterm. Then today, the model is to give you a yearly guidance that is clear and detailed and the model midterm, giving you the magnitude of our development and also reflecting the good diversification and the good development of the company across those different markets. Jean-Marc?

Thank you for the question on the RF growth model. Okay, so you can say that smart phone sales will become flat, but there is still, I mean, some growth which are forecasted like between 3%, 4% year-on-year. Obviously, I mean, what you see is that the market is moving to flagship models to put more premium models. So again, it means for us more content. In the smart phones, I mean, in the coming quarters, let's say, there is not only RF-SOI, there is now POI, I mean, being integrated. Also the good news is that, as I mentioned during the talk, the FD-SOI for me to wave applications, and we can still question. I mean, why is this [ getting implemented ]. But I mean it's [ hard for me to waive and why need to waive ] but I mean it's a fact today and it will continue. And it will continue probably because AI will also need more, I mean, capacity, more bandwidth, more [ dedicated ], and there is a real need to add more frequency to be able to deliver these capabilities, this capacity. So overall, in my model in the coming years, I still see a CAGR for RF-SOI of roughly 10%. POI, I will not tell you, but because, I mean, starting from scratch, so it's huge. But I mean, on FD-SOI, we will continue to penetrate. So today, I mean, it's already integrated in the iPhones, so a form of a tracker. As we mentioned, I mean, it's the worst year, I mean, [ meter waiver ] I mean also using FD-SOI for the Galaxy models and Pixel models. So of course, I mean, we bet that it will come soon also on iPhone. So I mean this is the future, and we will continue to assist to the growth of mobile communication.

And from Emmanuel to Emmanuel, from the last part of your question. Yes, we -- as I said, we see a slight slowdown in the EV at the beginning of the year, it's not fantastic. We are not totally immune of the market conditions, especially for Power-SOI and FD-SOI. But I don't see the stock corrections that we have seen in the smart phones. So the automotive had to rebuild their safety stocks after the COVID, where it destocks much too much, and it took them 3 years to reconsolidate their own safety stocks, stock of safety, of security. And now they manage, they adjust but I don't see any big stock corrections as you have seen in the smart phones.

Okay. Next question, Sébastien?

Another for you, Emmanuel. On SmartSiC. How do you see the volume ramp at your first customers, STMicro in the coming months? Are you still on track? Are you comfortable with the progress made there? And secondly, attached to that, do you see any kind of adoption acceleration in the adoption of SmartSiC among the other silicon carbide device player in the market? That would be the first question. The second one for Léa, your forecast for top line is flattish for this year. How do you see the 3 divisions trending in fiscal year 2025? What kind of growth -- sales growth or sales decline do you expect in the 3 main divisions?

So Sébastien, regarding the road map, I think Christophe is clear, and we are perfectly on line on our road map on SmartSiC.

Yes, yes. We will -- we -- as said in the slide, we've been working on the plan, and we are on time with our SmartSiC development. So now moving into...

[Technical Difficulty] [ GF ] standards because the name of the game is to be a standout into the market, and that's what is behind your questions. To make a standout, we have the board to have a good technology. It is. And we also need to be clear about is this technology fit or the different segment of the market where it started late or they prefer to wait or they want to see the first wave of SmartSiC going on, and they want to take the second wave or the third wave. And they really want to enter into the market with a very competitive edge, competition coming from innovation. This is the one who are adopting SmartSiC because they are really convinced that they will gain market share quick and fast, thanks SmartSiC. And OEM, we couldn't name it, you can see clearly. And the third one, and this is the one we just at the press release yesterday is the foundries. Those are market at the beginning because it was a new market created by Tesla 5 years ago. The first reaction of the manufacturer was to be vertically integrated to try to control at minimum the supply chain of the silicon carbide. But now as we see that in most of the big markets, big growing, fast-growing market in semicon industry, the foundries have started to be involved, and they are manufacturing some designs that are done by the fabless. And this is extremely important for us to see also the value of SmartSiC also for this segment. So a year ago, for instance, for POI, we announced fabless because in our recipe of installing our technology as a standard, we have to tick this box, and we're extremely pleased that this box has been ticked today as far as the SmartSiC, because [ that thing is ] that we are accelerating really in SmartSiC. So the fab is on time. We did it perfectly on the right time because we are now qualifying, and we have to qualify it only with a fab which is itself qualified. So the reason why the job is done by Cyril and Christophe were outstanding to do that from R&D to the fab in a record time. And now we are in this digestion by the market, full adoptions. And meanwhile, we are ramping, and the ramp is really on track and as per plan.

Regarding FY '25 revenue. So we are not disclosing guidance by divisions, however, what I can see. In Mobile division, we are seeing a decline for FY '25 due to this inventory digestion during the first 2 quarters. We will see significant growth for POI, but it will not be enough to fully compensate. And for the 2 other divisions, Smart Devices and Automotive, we see significant growth, double-digit growth.

Okay. Thank you. Maybe just two follow-up questions from the live. One regarding mobile from [ Alexsei ]. It would be really helpful to understand at a product level, where FY '24 finished. How big would you say was RF-SOI and POI and FD-SOI? So the kind of the weights of revenue contribution for the mobile division.

For FY '24, we showed it. I mean it was 62% overall for -- of course, for Mobile Communications. So the breakdown, I mean, yes. So again, I cannot tell the breakdown. RF-SOI is still the large majority. And you've seen, I mean, we did a very strong [ FQ4 ]. POI has been more than doubling compared to FY '23 and FD-SOI, both at the same pace. So we see [ a sync of ] more benefit this year for FD-SOI than last year.

And another question regarding Automotive. So for you, Emmanuel, from [indiscernible]. Regarding the [ V ] slowdown, what sort of visibility do you have in Automotive in general with your customers?

Directionally, they give us a pretty okay visibility. Even in the EV market, which is a fast-growing market, today, there are two things in this slight slowdown in the automotive, especially in the EV. So first, the cost of the cars are too high. So somewhere, it's the name of the game, into their own market -- on their own market, they are transforming well, but there are more than 100 cars manufacturers in China. Only 40% of them could export really, and now this balance between internal market China, which is really in terms of price a kind of brutal market, the price are really terrible over there because there's internal competition, which is hard. And the ability to export, that creates a little bit questioning into the market. That's the reason why there are this kind of momentum in the second wave of the EV. And of course, there's the charging station, but it's ongoing to be well resolved, especially with a different balance with the battery EVs, again, the hybrid EVs. So we see the market rebalancing. So directionally, we know how the things are moving. And yes, everything is coming a little bit in the same time at the beginning of 2024. But yes, at the end of the year and the remaining portion of the next year looks strong. And once again, we are coming from a 35% growth in EV. We are talking here about 20% growth. This is numbers which are very solid and very strong.

Just a question on finance regarding the EUR 250 million CapEx plan. How will you finance this spending? And would you need a new convertible bond. A question from [ Judy ].

Okay. So there are two parts in this question. First part regarding the CapEx. So we will continue to finance our CapEx, as usual, in France with leasing contracts for tools. And we do not plan to do additional new financing, except these leasing tools. Second part of the question is maybe as a management of our current convertible bond, OCEANE 25 with a maturity in October '25. So we will decide on the reimbursement or conversion. It's how we will manage this convertible bond.

Any question. Jerome.

Jerome Ramel, BNP Paribas Exane. Maybe a question for Emmanuel. Last time we met, I think you said on SmartSIC, you were engaged with like 23 or 24 clients and 2 in qualifications. You announced one client. Could you update us on where you are in terms of engagement and phase of qualification on SmartSiC? And the question I have behind is your target of 30% market share by 2030. How many clients do you need to reach that market share?

[ So, yes. ] We are we are more than 25 today, but I don't expect now any more other customers because with all the segments, we cover most of the big games -- big players into our markets. And the second number, the figure I was giving you is how many wafers into the field for test, qualification, prototypes and so on. So we are above 2,000 today. And of course, a lot of 200-millimeters on top of the 150. In terms of the numbers of clients -- customers, it's difficult to say. But by segment, we should expect in the top 5, 2 of them. In the challenger, it's a kind of pocket between 3 to 5, not more. And on the foundries, I think with 2 or 3 foundries will cover what we want to have. After that, it will depend how quick the market will turn from vertically integrated systems again, a pure foundry system. So it will never be a pure [ foundries ]. It will be a number of full vertical -- it will be a balance in between both systems. But roughly with these numbers of customers, I think we will well cover our 30% market shares for this SmartSiC into the SiC market, and we addressed 2 markets, automotive one, which is big and will be big in 2030. But probably even bigger, but later on will be the green industry. We included the chargers, and we include inside the renewable energies. So we know that we have the perfect right solution to feed these 2 markets.

And maybe just a follow-up question. On the guidance for this year of flattish revenues, what is the ASP assumption?

For FY '25, we are not planning a significant increase in ASP as compared to FY '24.