Hello. I am Ken Hsiang, the Head of Investor Relations for ASE Technology Holdings. Welcome to our Third Quarter 2020 Earnings Release. Thank you for attending our conference call today. Please refer to our safe harbor notice on Page 2. All participants consent to having their voices and questions broadcast via participation of this event. I would like to remind everyone on this call that the presentation that follows may contain forward-looking statements. These forward-looking statements are subject to a high degree of risk and our actual results may differ materially. For the purposes of this presentation, our dollar figures are generally stated in New Taiwan Dollars unless otherwise indicated. As a Taiwan-based company, our financials are presented in accordance with Taiwan IFRS. Results presented using Taiwan IFRS may differ materially from results using other accounting standards. I am joined today by Dr. Tien Wu, ASE Holdings COO, and Joseph Tung, ASE Holdings CFO. For today's call, I will be going over our financial results, Tien will be providing a market overview, and Joseph will provide a recap and our guidance. We will have a Q&A session following the prepared remarks. As with the rest of 2020, the third quarter has proven that there is never a dull moment, especially in the electronics industry. The third quarter was remarkably eventful for us. Typical seasonality ran through August with run rates reaching historical highs. However, in September, the Bureau of Industry and Security, Export Administration Regulation, EAR for short, went into effect. As a result, for our ATM business, we commenced to replace capacities left open by exiting business. This process occurred much more quickly than anticipated, as our overall loading levels snapped back to full utilization. During the quarter, we took two charges related to the EAR: one in cost of goods related to unused inventory and one in non-operation for interface boards used specifically for EAR impacted customers. We also experienced near-term highs in the value of the NT dollar relative to the U.S. dollar. Meanwhile, our EMS business ramped up a bit later in the year in line with a deferred seasonal pattern. We don't believe that EMS business has yet peaked for this manufacturing season. In total, we ended the quarter strong with strength across our core SiP, advanced packaging, and wire bond products. Please turn to Page 3, where you will find our third-quarter consolidated results at the Holding Company level. In this section, we will generally defer business explanations to our ATM and EMS P&L discussions. Intercompany transactions between our ATM and EMS businesses have been eliminated during consolidation. For the third quarter, we recorded fully diluted EPS of $1.54 and basic EPS of $1.57. This means that on a year-to-date perspective, we have fully diluted EPS of $4.01 and basic EPS of $4.12, exceeding full-year 2019 EPS already. Consolidated net revenue was $123.2 billion, representing a 15% increase quarter-over-quarter and a 5% increase year-over-year. We had a gross profit of $19.7 billion with a gross margin of 16%. Our gross margins declined by 1.5 percentage points quarter-over-quarter and 0.3 percentage points year-over-year. The sequential margin decline is primarily the result of the EAR impact, a stronger NT dollar environment, and a higher EMS business mix. The year-over-year decline is primarily the result of the EAR impact and the strong NT dollar. Our operating expenses increased by $0.2 billion during the third quarter to $10.6 billion as the result of higher operating expenses in our EMS business unit offset in part by lower operating expenses in our ATM business unit. Despite the increase, our operating expense percentage declined 1.1 percentage point sequentially and 0.5 percentage points year-over-year to 8.6%. This amount is currently trending below our 2018 operating expense percentage. Operating profit was $9.1 billion, up $0.7 billion sequentially, and year-over-year. Sequentially, operating margins declined 0.4 percentage points to 7.4% while increasing 0.3 percentage points year-over-year. During the quarter, we had a net non-operating loss of $0.1 billion. This amount primarily consists of net interest expense of $0.7 billion and an EAR-related tooling impairment of $0.7 billion. This amount was offset in part by net foreign exchange investment and sale of equipment gains. Tax expense for the quarter was $1.8 billion. The effective tax rate for the third quarter was 20%. Net income for the quarter was $6.7 billion, representing a decline of $0.2 billion sequentially, and an improvement of $1 billion year-over-year. We believe it is important to note the operating margin impact of the strengthening NT dollar and the EAR-related write down. Removing the inventory charge while using the second-quarter exchange rate, we estimate an operating margin of 8.6%. Similarly, using the third-quarter 2019 exchange rate, we estimate an operating margin of 9.7%. Without inclusion of the EAR-related inventory and equipment write down totaling $1.6 billion, we would have basic EPS of $1.84 during the quarter. On the bottom of the page, we have again provided key P&L line items without the inclusion of PPA-related expenses. Consolidated gross profit excluding PPA expenses would be $20.6 billion with a 16.7% gross margin. Operating profit would be $10.3 billion, with an operating margin of 8.3%. Net profit would be $7.9 billion with a net margin of 6.4%. Basic EPS excluding PPA expenses would be $1.84. On Page 4 is our ATM P&L. It is worth noting here that the ATM revenue reported here contains revenue eliminated at the Holding Company level related to intercompany transactions between our ATM and EMS businesses. The third quarter for ATM business was incredibly busy. Usually, that's good. We do a lot of work, and we get a lot of revenue for it. We had a different kind of busy this quarter, in which we were busy stopping EAR devices, re-tooling factory lines, and restarting replacement devices. This happened at a frenzied pace. As a result, despite the EAR disruption, we still saw measured growth. That's actually a significant achievement, given the size of the business lost, more about that later from Dr. Wu. After the third quarter finished, our ATM business outperformed our initial expectations quite significantly. In retrospect, we are somewhat surprised at the efficiency of the supply chain and the pace at which our capacity refill has happened. The refill was not the linear recovery we had initially anticipated. Instead, the business knocked back with new products rushing to replace vacated products. During the quarter, our ATM business continued seeing a strengthening NT dollar environment, in which the NT dollar appreciated 1.6%. Given that our orders are generally denominated in U.S. dollars while our factory costs are mostly denominated NT dollars, a strengthening NT dollar brings a higher cost structure for us. If the NT dollar stays strong for a longer term, we believe that we may be able to adjust pricing to compensate and purchase relatively cheaper U.S. denominated machinery and equipment. Shorter-term movements are more difficult to position. For the third quarter 2020, revenues for ATM business were $71.8 billion, up $2.3 billion from the previous quarter and up $3.9 billion from the same period last year. This represents a 3% increase sequentially and a 6% increase year-over-year. Our ATM revenues came in somewhat ahead of our expectations due to the stronger snapback of revenue post-EAR impact. Gross profit for ATM business was $14.5 billion, down $0.5 billion sequentially, and down $0.2 billion year-over-year. The sequential and year-over-year gross profit decline was primarily related to a one-time inventory write-off of EAR-related customer substrate of $0.9 billion and a stronger NT dollar. Gross profit margin for our ATM business was 20.2%, down 1.5 percentage points sequentially, and year-over-year. Margin decline was primarily attributable to EAR and NT dollar impact. During the third quarter, operating expenses were $7.7 billion, down $0.1 billion sequentially and $0.6 billion year-over-year. The sequential and year-over-year declines were driven by lower administrative costs. Our operating expense percentage was 10.8%, down 0.5 percentage points sequentially, and 1.4 percentage points year-over-year. During the third quarter, operating profit was $6.8 billion, representing a decline of $0.4 billion quarter-over-quarter and an improvement of $0.4 billion year-over-year. Operating margin was 9.5% declining 0.9 percentage points sequentially, and improving 0.1 percentage point year-over-year. For gross and operating margins, the one-time EAR inventory write-off had a 1.2 percentage point impact. We estimate that the strengthening NT dollar also had a 0.8 percentage point impact on gross margin sequentially, and a 2.7 percentage point impact year-over-year. Without the impact of PPA-related depreciation and amortization, ATM gross profit margin would be 21.5% and operating profit margin would be 11.1%. On Page 5, you'll find a graphical presentation of our ATM P&L. On Page 6, is our ATM revenue by market segment, not much has changed here. On Page 7, you will find our ATM revenue by service type. As stated earlier, capacities snapped back to running near full, outside of certain capacities requiring longer NPI time, and those NPIs are in process. From this chart, you can see here that our wire bonding business is performing particularly well. We believe that our wire bonding business is seeing a resurgence of demand, more about this from Dr. Wu later. On Page 8, you can see the results of our EMS business and its associated revenue by application. For EMS business, the third quarter usually represents the peak quarter in terms of seasonality. However, we anticipated a somewhat delayed manufacturing cycle. With that in consideration demand for our EMS business was stronger than anticipated, driven by strong SiP demand. During the third quarter, we had revenues of $53.1 billion increasing 34% sequentially, and 5% year-over-year. EMS revenues increased quarter-over-quarter primarily because of our seasonal business ramp. EMS revenues increased year-over-year primarily as a result of stronger demand for SiP products offset by a somewhat later seasonal products cycle. Our EMS gross profit was $5.1 billion, improving $1.4 billion sequentially, and $0.7 billion year-over-year. The sequential and year-over-year gross profit improvements were driven primarily by stronger customer demand for SiP related products. Gross profit margin for the EMS business came in at 9.7%, an improvement of 0.3 percentage point sequentially and 0.8 percentage points year-over-year. The margin improvement is primarily the result of product mix changes. Our EMS business units' third-quarter operating expenses were $2.8 billion, increasing $0.3 billion sequentially and $0.4 billion year-over-year. Operating expenses increased primarily as a result of increased employee profit sharing. Operating expense percentage was 5.3%, dropping one percentage point as compared to 6.3% last quarter, and increasing 0.5 percentage points, year-over-year. Our EMS operating profit for the quarter was $2.3 billion, representing a $1.1 billion improvement sequentially, and a $0.2 billion improvement year-over-year. The sequential operating profit improvement was primarily due to increased seasonal demand. Our EMS operating margin was 4.4%, which is a 1.3 percentage point improvement sequentially and a 0.3 percentage point improvement year-over-year. On the chart on the bottom half of the page, you'll find a graphical representation of our EMS revenue by application. Our consumer segment picked up seasonally, and this season we expect to add an incremental SiP product. We would expect that this segment continues to pick up into the fourth quarter. It is again worth noting that our EMS business unit runs under the name Universal Scientific Industrial, and is traded as an A share on the Shanghai Stock Exchange under the ticker number 601231. We currently own 75% of the company, which translates roughly to 5.9 billion U.S. dollars. In regards to our regulatory filings to complete our acquisition of Asteelflash, the current COVID-19 resurgence in Europe is impacting the duration of our regulatory reviews. As of yesterday, France announced its second countrywide lockdown. As a result, we currently expect the completion of our combination with Asteelflash to be somewhat delayed. We now expect for the regulatory process to complete before year-end. On Page 9, you will find key line items from our balance sheet. At the end of the quarter, we had cash, cash equivalents, and current financial assets of $61.8 billion. Our interest-bearing debt increased $7.1 billion to $224.6 billion. Total unused credit lines amounted to $255.6 billion. Our EBITDA for the quarter was $23.2 billion. We continue to target a net debt-to-equity ratio of 60% to 65% by the end of 2021. On Page 10, you will find our equipment capital expenditures. Machinery and equipment capital expenditures for the third quarter in U.S. dollars totaled $415 million, of which $288 million were used in packaging operations, $73 million in testing operations, $52 million in EMS operations, and $2 million in interconnect materials, operations, and others. 2020 is providing us with an unusual situation. We understand that there is an expectation of perfect fungibility where replacement business is entirely the same package types or customer platforms and requires no incremental tooling. In such a perfect scenario, incremental capital investment becomes completely unnecessary when replacement business comes onboard. Unfortunately, this perfect scenario almost never happens. One customer may have used a fan-out process while another one uses bumping and flip-chip. Customers may even use the same model tester with different instruments or configurations. As a result, in many cases, we have to make smaller investments on tooling or instruments to load previously purchased larger investments. In addition to facilitating the refill, we're seeing a significant pickup in our demand in wire bond related capacities. As a result, we do see the need to invest in our wire bond lines, Tien will speak shortly on this also. On Page 11, we have a brief year-to-date recap. All information here is presented on year-to-date terms. Holding Company revenue grew 15% year-over-year in U.S. dollar terms. ATM revenues grew 19% year-over-year in U.S. dollar terms, with gross margins improving 1.9 percentage points. Removing the impact of currency and EAR related expenses, gross margins improved 4.2 percentage points. EMS revenues grew 12% year-over-year in U.S. dollar terms. Year-to-date EPS is $4.12. For an update on the overall market environment, I'll now turn the microphone over to Dr. Tien Wu.

Hi, this is Tien Wu. I would like to offer you a business environment overview. If you look at Page 12, the assembly capacities are tight. In particular, wire bond capacity is extremely tight. The tightening situation, we expect that to last at least until Q2 of next year. In this environment, because we're seeing the tightness in wire bond as well as in all other assembly capacities, we believe the ASP environment will be favorable in 2021. In fact, we will start seeing margin improvement starting Q4 this year. But we do expect the ASP environment to be more favorable in 2021 compared to previous years. Let me talk about the sectors from our perspective. In the communication sector, we have 5G driving a portion of the growth. We also have a lot of Wi-Fi standards driving multiple upgrade cycles in communication, as well as in automotive. We are seeing a slowdown in automotive in Q1 and Q2. In Q3, we're seeing a remarkable recovery and strength in the automotive sector. We believe this will be reflected in Q4 as well as next year. Computing and consumer demand have been strong and will remain so for Q4. We also believe that computing and consumer demands will stay strong for 2021. A lot of investors are asking us about the COVID-19 effect. I would like to share our perspective with you. COVID-19 has created new value for our technology products. Namely, our technology products are viewed as an alternative to reduce medical risk. I will elaborate a bit more, also facilitating social connectivity in addition to the traditional value of digital efficiencies. What I refer to is the effect of work-from-home and learn-from-home, where people are buying IT products to minimize and reduce their exposure to medical risks due to COVID-19. Social connectivity will be augmented by IT products. In this scenario, we're seeing two fundamental changes in consumer behavior. First, more people tend to buy IT products. Second, people are willing to pay a higher price for IT products with enhanced performance. In this regard, we believe that during the COVID-19 days, IT products in almost all sectors are showing particular strength, especially communication products. With the 5G, Wi-Fi, and all the upgrade cycles, permeating through cell phones, automotive, PC, Bluetooth, and all of the IoT devices, we believe there are fundamental changes in the way people are willing to spend money on IT products. Additionally, we are clearly seeing an increase in product complexity, particularly in wire bond applications. The number of stacked dies that we're dealing with now exceeds what we've seen before. We are increasingly working with dies for RF and Analog applications, and we're seeing more multiple dies requiring wire bonds that we have not encountered previously. In this cycle, it's not just the volume; it's also the number of dies, the number of wires, and the overall complexity. Furthermore, because some of these products are going to medical devices and automotive applications, the quality requirements are different from that of consumer products. For quality wire bond services, we can command a premium this year and I believe continuing into 2021 and beyond. Let me comment on the OSAT overall CapEx expenditure. If you go back to 2018, 2019, and the incomplete view of 2020, you will see that the overall OSAT industry has been under-invested. In that scenario, ASE has been spending CapEx in 2018, 2019, as well as in 2020. Going forward, we will accelerate spending in Q4 so that we can place more capacity in anticipation of fulfilling customer demands. Moving into 2021, we will be moderating on the CapEx, which Joseph, our CFO, will discuss in further detail shortly. Based on our new design wins and long-term forecasts, as of today, we believe we will have a strong 2021 and are quite optimistic about our growth and market share gains. In our calculation, if we exclude the EAR impact, we believe ASE is gaining shares in all sectors and all package types. Please turn to the next page, Page 13. Ken already discussed the painful experience and the sudden nature of the EAR action. The EAR effect on ATM revenue in Q1 and Q2 accounted for about 20% of our overall ATM run rate. In Q3, it was down to about 13%. In Q4, we expect it to be zero. Greater than 75% of the lost revenue and the lost capacity have been impacted, as Ken already mentioned. With the help of all of our partners throughout the supply chain and our customers, the remaining 25% will be backfilled by the end of Q1 2021. So as of today, we're confident that our year-over-year growth in 2021 will remain positive. In other words, all of the tooling and asset disposition have been completed either in Q3 or will be completed by Q4 of this year. Ken already mentioned the one-time write-off included in the Q3 numbers that we just reported. With all the additional work done in Q4 or Q1 of next year, we will not incur any further charges. With that, I will turn the floor over to our CFO, Joseph Tung.

Okay, good afternoon, everybody. This is Joseph. Before I delve into further comments on the financials, I would like to give a very brief comment on our third quarter results. We successfully managed through a chaotic third quarter and came out with much stronger-than-expected quarterly results. Such results were made possible through close cooperation among different operating units that allowed us to substantially reduce the negative impact of the EAR restrictions and quickly regain our momentum moving forward. Now, with that said, I want to take a few minutes to update you on the progress we are making towards some of our financial targets set at the beginning of the year. First, our OpEx ratio target is to return to the 2018 level of 9.4%. In the third quarter, it came down to 8.6%, down from 9.7% the previous quarter, which is well below our target level. With continuous effort going into Q4, I strongly believe that not only will we reach our target, but it is more likely we will exceed it. Second, regarding operating margin, we stated we aim for a 2% improvement this year. I believe we are ahead of schedule, especially when taking out the negative impacts from NT dollar appreciation and EAR-induced inventory write-downs. Although it is difficult to quantify the overall improvement in operating margin coming from synergy, part of the overall improvement comes from the synergies created between ASE and SPIL through increased coordination. Moving forward, we will further deepen and broaden such coordination across various parts of our operation, including capacity alignment, business development, procurement, and R&D. Thirdly, on CapEx, after heavy investments in the previous years to support our strong business momentum, our CapEx in 2021 should start to moderate. Currently, I believe the CapEx amount for 2021 should fall between the levels of 2018 and 2019, while leaning more towards the 2018 level. With improved profitability and reduced CapEx, our cash flow position in 2021 will show significant improvement. This will allow us to increase our cash dividend payout to no less than $3 per share while still reaching our deleveraging target of a net debt-to-equity ratio of 60% to 65% by the end of 2021. Now with that, let me provide our fourth quarter guidance. Based on our current business outlook and exchange rate assumptions, management projects overall performance for the first quarter of 2020 as follows: in NT dollar terms, ATM fourth quarter 2020 business should be similar to our first half 2020 levels. ATM fourth quarter 2020 gross margin should also align with first half 2020 levels. Our EMS in NT dollar terms, fourth quarter revenue anticipates sequential growth rates to closely match the average of the second and third quarter 2020 levels. While EMS fourth quarter 2020 operating margin should be slightly better than the averages of the second and third quarter levels. It’s a bit complicated, but I’m sure everyone will figure that out. Thank you very much. Now I’d like to open the floor to the Q&A session.

Yes, thank you. Ladies and gentlemen, we are now in the Q&A session. The first question comes from Gokul Hariharan, JPMorgan. Go ahead, please.

Yeah, hi. Congrats on managing through the situation in Q3, and the good results. A quick question on IC ATM. Could we talk a little bit about - we talked about some price adjustments potentially and could we talk a little bit more in detail about what discussions you're having with customers? Given that this year, currency has clearly affected margins and taken away a fair bit of the margin improvement, could you elaborate on the conversations you are having with customers regarding potential price adjustments on the currency side? That is my first question. Second is, we do hear that there is some degree of capacity shift happening towards non-China OSATs. What does ASE see in terms of your customer base both for advanced packaging and wire bond? And how should we think about capacity build for ASE, given you also sold a small fab in China by announcing meaningful investments in Kaohsiung? Thank you.

So to answer your first question, we will not comment on any specific customer engagement. However, in the overall scenario, the wire bond gap, as of today, is anywhere between 30% to 40%. It is not a 3% to 4% gap; the gap is quite substantial. ASE today, we have the largest install base for wire bond as well as the best efficiency and quality. A lot of customers are either moving business from somewhere else or are based on organic growth or new product ramps; the demand is very strong. The kind of conversation that we're having is, for example, there is a lead frame and substrate cost increase and the gold prices have fluctuated. Whenever there is expedited delivery, that cost will be reflected. Particularly, we are engaging with multiple customers in longer service contracts. For example, we're talking six months to one year, and in some cases, we're discussing two-year take or pay arrangements. In other words, all the capacity we have put in place since 2018 has been utilized. Right now we're cautious in terms of adding capacity because we understand the tightening situation. We believe all of the capacity we are currently adding has long-term service contracts behind it. We observe that the assembly equipment lead time is now quite long. I don't believe we are overbuilding capacity by any standard, which is why I need to comment that the tightness situation will last at least until Q2 of next year, right? So, that addresses your first question. For the second question, I can't comment on which of our customers could be moving from China. I believe there are movements on both sides. Obviously, we do have customers intending to have more of the supply chain out in China. We have also seen those cases, but I believe we also have other cases.

Thanks, Dr. Wu. Just one confirmation: 30% to 40% is the supply to demand gap in wire bonding, right?

As of today, that is correct. But I am making a comment on behalf of ASE.

Next to ask a question is Bruce from Goldman Sachs. Go ahead, please.

Hi. My question is for mainly for Ken. I think that from our perspective, we are happy to see that management is commenting on some of the dollar content growth for the packaging. Can you elaborate more? For example, for 5G smartphone chips, we see a lot of dollar content growth from the wafer side, from production side. But for packaging and testing, maybe a little bit different for testing. The entire dollar content for the packaging is not growing, or it's growing a lot slower than the wafer at the foundry side. So can you comment a little bit more about what kind of dollar content growth for packaging is moving forward, based on industry standards?

That is a very difficult question. I believe in general, people are complaining that packaging is becoming a higher percentage of cost within the total. If you comment based on the automotive sector, we have already seen more semiconductors in the latest 5G phones. You've seen the AIP, you have seen the front-end module, the PA, and you're also observing more semiconductor content. Overall, I don't believe packaging costs should be going up as fast as foundry because the foundry's investment versus return must differ based on the business model. However, I do believe the packaging content—when normalized—will show an upward trend.

It is difficult for us to see that from the revenue growth side. Because, for example, the smartphone chip is clear for the wafer side but not clear at all for the packaging side. So it's difficult for us to ask for certain qualitative analysis for that.

I apologize, but I don't have the specific numbers.

Now the line is open to Szeho Ng, China Renaissance. Go ahead, please.

Hi, good afternoon, gentlemen. My first question is regarding CapEx. You mentioned next year's CapEx will return to the 2018 level. That would represent a sharp drop compared with this year's level. So I just wonder which areas you will hold back investments for next year?

If you look at ASE in 2018, we started the major investment ramp. In 2019, when everybody backed off—our spending was around $1.4 billion, $1.5 billion. In 2020, we were actively investing as well, anticipating another supercycle. That's why Q1, Q2, Q3, we managed to spend a good amount. But in Q4, we will continue to spend. After three years of supercycle, we believe we have all the technology and basic elements in place. However, we could also consider optimizing and maximizing the capacity that has already been put in place. Over the last three years, much of the CapEx has gone towards automation. So ASE has been exploring and expanding the efficiency of our LiDAR factories.

I think a little bit as about the moderating CapEx in 2021 is that we are actually upping our CapEx this year, going into Q4 because of the overall retooling and realignment. We are trying to fill the gap that exists today on wire bonding. So the overall CapEx for this year is actually going to exceed our original target.

So what role will ASE play in heterogeneous packaging?

When we talk about heterogeneous integration, we are referring to silicon passes, sensors, optical, audio, different components, and functionalities. Our SiP products integrate diverse functionalities through packaging. This is slightly different from the SOC approach, which combines memory and logic chips together, but both require consideration of different material characteristics.

Thank you. And my last question may be on the financial part, what is the company's gross margin sensitivity to FX? Any ballpark indication would be helpful.

For each percentage point appreciation of the NT dollar, that will have a 50 basis point impact on our gross margin on the ATM side; at the holding level, the total impact will be approximately 30 basis points.

Next one to ask questions is Roland Shu from Citigroup. Go ahead, please.

Hi, good afternoon. I think my first question is concerning the EAR impact, where you mentioned 75% of the demand has been backfilled, and the remaining 25% will be backfilled in the first quarter next year. What kind of demands have been delayed or backfilled, and how confident are you that this is achievable?

We are seeing strength from all sectors, particularly the communication sectors, thanks to the release of capacity after September 15. We are currently retooling a lot of bumping facility capacity to serve customers in other sectors. The 75% has already been backfilled, and we are confident that the remaining 25% will be filled by the end of Q1 2021. Customer demand is strong, and we have received firm indications from our customers either via contracts or commitments.

Understood. So these are the main constraints based on capacity. My second question hinges on your Q4 guidance, specifically for IC ATM. If I combine your Q4 IC ATM revenue with Q3, the total increase for the second half is around low single digits annually. In contrast, TSMC and UMC's second halves are growing 17% and 13% year-over-year respectively. Why do you think your growth is lower? Is it because of capacity constraints or competition?

The capacity impacts the EAR effects, where our Q1 Q2 run rates were around 20%. Q3 dropped to about 13%, in Q4 it will be zero. Therefore, we need to work towards compensating revenue losses. Overall, if examined over the full-year performance, I believe we remain reasonable compared to the OSAT sector, particularly when excluding the EAR effects, our growth rate exceeded competitors. The EAR caused a temporary setback, but we are on our way back up.

May I ask about utilization rates for 3Q and 4Q for all product lines?

In Q3, assembly utilization was above 80%, and testing was around 80% as well. For Q4, assembly capacity will remain at above 80%, while testing may reduce slightly to about 70% to 75%.

What causes the test revenue or utilization to go down—will it be due to a multi-interest?

Part of the EAR impact is that the customers affected by EAR typically have a higher turndown rate.

Understood. Thank you for your insights.

Thank you for your time. In summary, we had a strong third quarter and are seeing improvement heading into Q4 as the EAR situation is largely resolved. Business remains strong, and we are in a pricing-friendly environment. We have made significant CapEx investments over the past few years that position us well to capture future growth opportunities. The synergies created through our operations are reflected in our improved margin and declining OpEx ratio. We remain optimistic about our business prospects for 2021 and are looking forward to improving cash flow and financial standing in the future. Thank you all for joining the conference call today.