From a mixed standpoint, although the annual one-off pricing adjustments, this will lead to a slightly lower blend ASP for Q1, and we expect this ASP will remain firm beyond Q1 ‘24 for the rest of the year 2024, which already factor in including the product mix, LTA terms for example.
Randy Abrams: Okay. No, just to clarify, in first quarter, is mix like how is 28 nanometer doing versus the mature note? Are they coming back a little bit with shipment rebound or is it relatively stable mix across?
Jason Wang : Well, I mean the overall, the Q1 28 nanometer loading is slightly lighter than Q4 ‘23, mainly due to the seasonality effect and some urging order in Q4 ‘23, and our overall 22 and 28 loading continue to be resilient amid the market fluctuation. And we will also continue to grow our 22 and 28 business with our customer for the application of Olay driver, ISP, WiFi, SOC processes, while the further expansion of technology offering in the advanced NCU product and automotive industrial application. Q1 will experiencing a slightly lighter of loading for 28.
Operator: Next one, Nicholas Barrett, Macquarie. Go ahead please.
Nicholas Barrett : Do you hear me okay or not?
Jason Wang: Yes, I think we can.
Nicholas Barrett : Okay, thank you. Sorry. Last quarter, I think you mentioned some weaker end demand in automobile and industrial. Is it still the case and does that contribute to lower loading, lower ASP in 1Q ‘24?
Jason Wang: Yes, for the Q1 for the — on the segment side, we expect that automotive industrial end market will continue to experiencing the inventory correction. Hence, the wafer domain, automotive and industrial seven will remain solved. The communication, computer and consuming segment have stabilized for now and the contribution will remain flattish quarter-over-quarter.
Nicholas Barrett: So, you mentioned $3.3 billion CapEx in 2024, 95% in 12 inch, right? I think that’s correct. Has this entirely include — is it entirely 28, 22 earning per capacity increase? Or is there something else?
Jason Wang : Well, for our 2024 cash-based CapEx our budget is $3.3 billion. Out of that, the 20% of CapEx was a budget total to 22 and 28 expansion in our — the remaining expansion in P6 and the 12X, which was a pushed out during the 2022 and 2023 time. This reflects our effort to managing our CapEx. Around 60% of the 2024 CapEx will be spent on the 12i P3 infrastructure as well as a minimum two end equipment’s. We will expect the ramp rent of the 12i P3 will start at April 2025. So, the infrastructure is ongoing. And we project the CapEx will peak out this year and will not impact company’s cash dividend policy. As we have stated in the past, our CapEx strategy will continue to remain a disciplined ROI-driven phase and our affordability as well, where we invest toward future growth back with a customer commitment. If the market do not rebound as expected in 2025, we will further adjust our CapEx accordingly.
Nicholas Barrett: Understood. Is there a change in the planned capacity of P3 in Singapore?
Jason Wang: I mean, the 12i Singapore P3, the infrastructure as a planet is a pursuit of the plan for the infrastructure means the overall structure of the building and the facilities, but now only with a very minimum two of equipment.
Nicholas Barrett: For 2024, yes. Okay. Thank you very much.
Operator: Thank you, Nico. Next one, Gokul Hariharan, JPMorgan. Go ahead please.
Gokul Hariharan: Hi. Thanks for taking my question. My first question just to follow-up on the Intel collaboration. Would you be also using the same node in some of your future fabs, the 12 nanometer node or like, let’s say, your lateral phase of expansion in Singapore or is that going to be all the 12 nanometer capacity will be only in the U.S. Fabs of your partner?
Jason Wang: I mean, not at this point and we will focus on to ramp this, the Western footprint first and if it comes to the market demands and/or the customer commitment that we are looking to the other option as well, but not at this point, no.
Gokul Hariharan: Okay, understood. Jason, maybe a little bit more on the pricing front. Could you talk a little bit about what you are seeing in various parts of your portfolio, 8 inch, 28 nanometer and metro 12 inch? Are you seeing any very different kind pricing and given your firm pricing strategy, how is your market share holding up with your key customers? Are you seeing any market share losses, given all these concerns about capacity expansion in China?
Jason Wang: I mean, in the foundry landscape, some markets are more likely to become commoditized. However, our strategy has always focused on technology differentiation that will drive our long-term growth and ship away from a commoditized market with a low entry barrier. Right now, there is still a mix of a product within our portfolio and we are gradually moving away from that. We have proactively increased our effort in technology advancement, including 12 nanometer, like we talked about it and 22, 28. For example, we expect to see higher revenue contribution from a technology node such as 22, 28 EHIV [ph 0:27:27.9] 55 nanometer RFSOI in 2024. Beyond 2024, our broader technology offering along with the geographically diverse and manufacturing location and the customer stickiness will elevate our overall competitive, so we expect this action will reduce our exposure by habit in the next couple of years, inherent for our current commoditized product by half in the next few years.
