Tower Semiconductor Ltd. (NASDAQ:TSEM) Q3 2023 Earnings Call Transcript

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Russell Ellwanger: It’s a very good question and one that I don’t have the greatest answer for you because the Silicon Photonics market is not as mature as far as its establishment as is the Silicon Germanium. We’re certainly in with the leaders there. I think what we do with SiPho is very strong. I couldn’t give you an exact market share number at this moment. I expect that we will have a substantial if not the major market share of SiPho as the ramps occur, as the 800G and beyond really start moving quickly. But I could not tell you right now what our exact market share is. I really couldn’t. I know that we’re very well positioned, but it’s a little bit difficult to know. I think that at the moment, the major market share belongs to an IDM.

Natalia Winkler: Understood, thank you. That’s very helpful. And then if I may, and just kind of, if we’re thinking about the long-term model, how should we think about the mix within that long-term model? And I guess another way to put it is if we’re thinking about the capacity additions that you guys are doing in Agrate and Intel, are there any kind of Silicon Germanium additional capacity that’s coming online, or is that largely kind of focused on the non-Silicon Germanium, non-Silicon Photonics applications such as the CMOS and Analogs?

Russell Ellwanger: That’s a very good question. The bulk of the reasons for driving the capacity increases in Agrate is the RF-SOI, and in the Fab 11X in New Mexico, it’s for the BCD as I mentioned before. That’s not to say that we’re not doing activities to expand Silicon Photonics, both at 200mm and at 300mm, we are. But the biggest growth drivers right now and impetus for the Agrate as well as the New Mexico was RF-SOI and Power management and particularly 5 BCD and an extendable roadmap for that.

Natalia Winkler: This is very helpful and if I may, just a quick follow-up on this. On the 300mm Silicon Photonics, is that something you guys are already shipping, or is that kind of part of the future roadmap?

Russell Ellwanger: We have shipped prototypes. So yes, we have shipped. And yes, it is part of the future roadmap.

Natalia Winkler: Thank you.

Russell Ellwanger: So it’s not something that doesn’t exist now. We do have some prototypes that’s gone out.

Natalia Winkler: Thank you.

Operator: This concludes the question-and-answer session. Mr. Ellwanger, would you like to make your concluding statement?

Russell Ellwanger: Yes, thank you. Firstly, again, really much appreciation to everyone that has given well-wishing during this period of war. Secondly, as far as the company, I don’t believe we’ve ever been in a more exciting position than we are now. So much advancement in technology platforms, so much advancement in customer partnerships, we sit extremely confident that in areas where there has been market weakness, the market will return. And we will return with higher market shares than we had in the past. And that’s how you outgrow the market. So we thank everybody. And my biggest appreciation, as stated, to our employees that still come to the factory and put everything they can to take up for the burdens of those that can’t presently come to the factory here in Israel. So thank you very, very much.

Operator: Thank you. This concludes Tower Semiconductor conference call. Thank you for your participation. You may go ahead and disconnect.

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