Securities code: Verisilicon Microelectronics (Shanghai) Co.Ltd(688521) securities abbreviation: Verisilicon Microelectronics (Shanghai) Co.Ltd(688521)
Xinyuan Microelectronics (Shanghai) Co., Ltd
Record of investor relations activities
Investor relations activities √ specific object research □ analyst meeting
Activity category □ media interview □ performance briefing
□ press conference □ Roadshow
□ site visit □ teleconference
□ others ()
Name of participant: March 11, 2022
Cathay Pacific Investment Trust, xingyin financial management, China Shipping fund, Galaxy fund, Runhui investment, Haifutong fund, CICC capital, ICBC Credit Suisse, Changjian investment, etc
March 17, 2022
Changjiang Securities Company Limited(000783) , Taikang assets, Tian’an life, Bodao fund, Boshi fund, HSBC Jinxin, Harvest Fund, BOC fund, Zheshang fund, Oriental alpha, Morgan Stanley Huaxin, PICC Hong Kong assets, Baoying fund, Shanghai Investment Morgan, etc
March 30, 2022
Hua’an assets, Bodao fund, noan fund, Hongde fund, Huaxia Fund, xingyin fund, Puyin AXA fund, Shanghai Investment Morgan, Cathay Pacific Fund, Xingshi investment, etc
March 31, 2022
Huisheng fund, Guoshou security fund, Fengyan investment, BlackRock assets, Harvest Fund, Taikang endowment insurance, HSBC Jinxin, Tianhong fund, Wanjia fund, China Post venture fund, etc
March 31, 2022
Manulife asset management, harvest global investments, Cephei capital management, Morgan Stanley group, pinpoint group, Samsung asset management (HK), prudence group, etc
Time: March 11, 2022, March 17, 2022, March 30, 2022, March 31, 2022
Research methods: online or offline meetings
RECEPTIONIST: Chairman and President of the company: Wayne Wei-ming Dai
Name: Director of the company, CFO, Secretary of the board of directors: Shi Wenxi
Introduction to main contents of investor relations activities
Verisilicon Microelectronics (Shanghai) Co.Ltd(688521) is an enterprise relying on independent semiconductor IP to provide customers with platform, all-round and one-stop chip customization services and semiconductor IP authorization services. So far, the company has a variety of one-stop chip customization solutions such as high-definition video, high-definition audio and voice, on-board entertainment system processor, video monitoring, Internet of things connection and data center, as well as autonomous and controllable graphics processor IP, neural network processor IP, video processor IP, digital signal processor IP There are six types of image signal processor IP and display processor IP, more than 1400 digital analog hybrid IP and RF IP. The application fields of the main business include consumer electronics, automotive electronics, computers and peripherals, industry, data processing, Internet of things, etc. the main customers include IDM, chip design companies, system manufacturers, large Internet companies, etc.
Xinyuan has excellent design capabilities in global mainstream semiconductor process nodes such as traditional CMOS, advanced FinFET and fd-soi. In terms of advanced semiconductor process nodes, the company has the successful experience of 14nm / 10nm / 7Nm FinFET and 28nm / 22nm fd-soi process node chips. At present, 5nm design projects have been completed, and many design projects are pending. In addition, according to IPnest’s statistics in 2021, the semiconductor IP is the first ranked Chinese mainland and the seventh largest semiconductor IP authorized service provider in the world, ranking the top seven in the world.
Among them, the growth rate of Xinyuan ranks the second, and the IP types rank the top two.
In 2021, the company always adhered to the strategic objectives, adhered to R & D and innovation, and continuously improved its technical capabilities. During the reporting period, the company achieved an operating revenue of RMB 2.139 billion, with a year-on-year increase of 42.04%. The business scale effect has appeared, driving the continuous improvement of the company’s profitability. The net profit attributable to the owner of the parent company was RMB 132924 million, and the net profit turned from loss to profit, an increase of RMB 388587 million over the same period of the previous year.
Question 1: what is the progress of the company’s three strategic R & D projects?
Reply: the company’s three strategic R & D projects are continuously invested according to the project arrangement and are progressing smoothly. Specifically:
(1) The first generation platform of the company’s data center video transcoding project has completed research and development in the second quarter of 2021, and has been adopted and shipped by many customers in the form of IP authorization and one-stop chip customization business. Customers include many large Internet companies and well-known short video service providers; In addition, the one-stop chip customization project of the second generation video transcoding platform based on the company’s IP (including software and hardware collaborative verification) has been basically completed. Based on the original technology, the platform enhances the video transcoding capability of different formats to 8K, increases the support for AV1 format, and adds AI processing capability. In addition, High performance multi-core risc-v CPU and hardware encryption engine are also added.
Exchange Q & A
(2) The 12NM SOC version of the high-end application processor platform project has been completed in 2020. It will be successfully streamed in January 2021, and will be returned and lit up in May 2021. The laboratory test of the hardware module of the engineering sample has been basically completed, and the key technologies such as advanced memory scheme (Ultimate memory / buffer technology) and advanced packaging have been confirmed by the chip engineering; From 2022 to 2023, we plan to promote the iterative research and development of chiplet scheme on the basis of the previous stage of research and development.
(3) TWS Bluetooth connection platform project entered the development stage in 2020 and is currently in the software platform development stage. At present, the company has cooperated with international leading MCU companies to help customers develop and design industry-leading MCU chips with very low power consumption and Bluetooth integration.
Question 2: the company’s chip design business revenue has increased significantly in 2021. What is the driving force of growth?
Reply: in 2021, the company achieved a chip design business revenue of 548 million yuan, a significant year-on-year increase of 104.48%, while the overall number of R & D personnel of the company increased by about 16.8% in 2021. Therefore, the growth of the company’s revenue is not a simple stacking of R & D personnel. Compared with increasing the number of personnel, we believe that having advanced chip design ability is more important for maintaining the core competitiveness and customer service level of Xinyuan. The company attaches importance to improving the chip design capability of advanced processes. By the end of 2021, the company has implemented 90 chip design projects, of which the number of projects with process nodes of 28nm and below accounts for 44.44%, the number of projects with process nodes of 14nm and below accounts for 27.78%, and the number of projects with process nodes of 7Nm and below accounts for 5.56%; In the design business income, the income of process nodes of 14nm and below accounts for more than 70%, and the income of process nodes of 7Nm and below accounts for about 50%. In the future, the company will continue to actively maintain and continuously improve its business capabilities in advanced processes and enhance its core competitiveness. Question 3: how will the company plan its future IP development?
Reply: through years of R & D accumulation, the company has its own six processor IP, more than 1400 digital analog hybrid IP and RF IP. The IP is highly complete and the market competitiveness of each IP is also very strong. With the development of the market and industry, our original IP will continue to iterate according to the needs of customers and the market. On this basis, we will also enrich the company’s IP territory in a planned way according to the technology and market development trend and combined with the company’s own advantages, and multiple IP lines form a “combination fist” to better meet the needs of customers in different scenarios.
At present, we have launched a platform authorization business model based on semiconductor IP. This authorization platform usually contains multiple IP products of the company. The organic combination between IP forms subsystem solutions and platform solutions, which optimizes the efficiency of collaborative processing between IP, reduces system power consumption and simplifies system design. In addition, each self owned IP can also be organically combined to realize technological innovation. For example, the NPU IP of Xinyuan can be combined with other processor IP of Xinyuan to support the upgrading and development of artificial intelligence in a variety of application scenarios. At present, our ai-isp series has been widely favored by mobile phone and machine vision related application customers. Similar AI video technology and the combination of AI and GPGPU all play a significant role in the products of leading customers in relevant industries.
Question 4: the company has always adopted the wafer factory neutrality policy. What is the current capacity of the company? Reply: under the current tight global production capacity environment, many companies are even difficult to obtain the same production capacity as the previous year, but Xinyuan’s mass production business in 2021 still achieved good results, and the revenue of mass production business in 2021 increased by 35.40% year-on-year. The guarantee of production capacity mainly benefits from the wafer factory neutrality strategy and good supply chain management mechanism of Xinyuan. The company adheres to the principle of Wafer Factory neutrality and maintains close contact and long-term cooperation with wafer factories. In the long-term cooperation, Xinyuan has established a good business reputation, which is more conducive to booking production capacity under the condition of tight production capacity. The tight production capacity of wafer factories in the industry will indeed have a certain impact on the company, but the company has made a positive response. By maintaining a good cooperative relationship with many wafer manufacturers, purchasing and booking production capacity in advance, it is expected to reduce the risk caused by production capacity as much as possible and meet the needs of customers for normal chip production. Question 5: does the company have any pressure on talent development this year?
Reply: in recent years, the talent problem in the semiconductor industry is relatively serious, but Xinyuan has maintained a low turnover rate in the industry. In 2021, the turnover rate of employees in China was 6.8%, far lower than the active turnover rate of 18.2% in the semiconductor industry. Xinyuan has always attached great importance to talent training. Adhering to the introduction and training of excellent talents is not only the key to the survival and development of the company, but also the basis for the company to continuously improve its core competitiveness.
In terms of introducing external talents, the company not only recruits experienced talents through internal recommendation, online recruitment and other ways, but also attracts and recruits graduates from top universities at home and abroad by jointly carrying out technical lectures with major universities, “Xinyuan Cup” circuit design competition, special campus recruitment fair and other ways, so as to provide talent reserves for the sustainable and stable development of the company. In terms of internal talent training, the company continues to implement perfect and effective training programs and open and transparent promotion mechanism, including improving the comprehensive development ability of employees through Wuxi Online Offline Communication Information Technology Co.Ltd(300959) ‘s technical and management training; Actively create a good working environment and improve the cohesion of employees from the aspects of corporate culture, salary and welfare, talent incentive and so on. In addition, with the establishment of the company’s port R & D center, the company will
