Core Insights - TestGrid has launched CoTester for ServiceNow, the first testing agent specifically designed for the ServiceNow ecosystem, enabling end-to-end testing with adaptive AI and zero-maintenance execution [1][5] Group 1: Product Features - CoTester for ServiceNow automates the testing process, generating test cases from workflows and healing broken scripts in real time, ensuring continuous quality and faster release cycles [2][3] - The solution utilizes a multi-modal AI engine that analyzes screens, text, and layout to detect subtle UI changes, while its self-healing module, AgentRx, updates scripts automatically [4] - Key capabilities include AI-powered test generation, automatic self-healing during upgrades, prebuilt test libraries, and seamless integration with popular DevOps tools [6] Group 2: Performance Metrics - Early adopters report significant improvements, including a 45% faster upgrade validation and a 60% reduction in maintenance effort, with zero workflow disruption during platform updates [7] - The solution offers up to a 70% reduction in test maintenance effort, 50% faster upgrade validation cycles, and 40% lower overall testing costs [6] Group 3: Market Impact - CoTester for ServiceNow is already deployed across Fortune 100 enterprises in sectors such as banking, telecom, healthcare, and eCommerce, expanding its reach in critical automation spaces [5][7] - The product is compatible with both standard and heavily customized ServiceNow instances, making it versatile for various enterprise needs [7]

Financial Data and Key Metrics Changes - The company recorded fully diluted EPS of $1.64 and basic EPS of $1.75 for the first quarter, with consolidated net revenues declining by 9% sequentially but increasing by 12% year over year [9][12] - Gross profit was NT$24.9 billion with a gross margin of 16.8%, improving by 0.4 percentage points sequentially and 1.1 percentage points year over year [10][12] - Operating profit was NT$9.7 billion, down NT$1.5 billion sequentially but up NT$2.2 billion year over year, with an operating margin decline of 0.4 percentage points sequentially and an improvement of 0.9 percentage points year over year [11][12] Business Line Data and Key Metrics Changes - In the ATM business, revenues were NT$86.7 billion, down NT$1.7 billion sequentially but up NT$12.8 billion year over year, representing a 2% decline sequentially and a 17% increase annually [15] - The EMS business reported revenues of NT$62.3 billion, declining NT$12.6 billion or 17% sequentially, while increasing NT$2.9 billion or 5% year over year [23] Market Data and Key Metrics Changes - The company noted a potential shallower seasonal dip in EMS business due to customers adjusting order flow patterns, indicating a more stable demand environment [6][23] - The computing segment within the ATM business saw significant growth, particularly driven by stable high demand for AI products, while other segments like handsets were seasonally impacted [19] Company Strategy and Development Direction - The company aims to minimize short-term noise to focus on long-term signals, emphasizing the importance of technological trends and process improvements to maintain competitive advantages [7][8] - The company is committed to increasing its market share in the testing segment, targeting a contribution of 19% to 20% of overall ATM revenue by year-end [21][22] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the second quarter outlook, expecting ATM revenues to grow by 9% to 11% quarter over quarter, while EMS revenues are projected to decline by 10% year over year [30][31] - The management acknowledged the challenges posed by macroeconomic volatility but remains focused on long-term strategic investments [6][8] Other Important Information - The company anticipates a peak in net debt to equity ratio at around 60% in the third quarter of the year, with total unused credit lines amounting to NT$358.4 billion [26] - Capital expenditures for the first quarter totaled NT$892 million, with significant investments planned for machinery and equipment to support future product demands [27][28] Q&A Session Summary Question: AI test market share and CapEx on testing - Management confirmed aggressive investments in the test segment, aiming to increase market share, particularly in AI chip testing, with a target of reaching 20% of ATM revenue by year-end [34][36] Question: U.S. investments and capacity planning - The company is evaluating opportunities for operations in the U.S. to support customer demand, with no specific investment size or timing details available yet [42][44] Question: Market share in AI testing across different products - Management indicated that while they do not have a detailed breakdown of market share by product, they are focused on expanding their test business across all areas, including AI chips [47][49] Question: Impact of tariffs on business - Management stated that the direct exposure to U.S. tariffs is minimal, with less than 10% of EMS shipments going directly to the U.S., and they do not anticipate significant impacts from potential tariffs [93][94] Question: General demand outlook for consumer electronics and automotive - Management noted a gradual recovery in most sectors, with high-end automotive showing better momentum, while lower-end segments are still undergoing inventory corrections [97]

Financial Data and Key Metrics Changes - The company reported fully diluted EPS of $1.64 and basic EPS of $1.75 for Q1 2025, with consolidated net revenues declining by 9% sequentially but increasing by 12% year over year [8][12] - Gross profit was NT$24.9 billion with a gross margin of 16.8%, improving by 0.4 percentage points sequentially and 1.1 percentage points year over year [9][10] - Operating profit was NT$9.7 billion, down NT$1.5 billion sequentially but up NT$2.2 billion year over year, with an operating margin of 7.1% [11][13] Business Line Data and Key Metrics Changes - ATM business revenues were NT$86.7 billion, down NT$1.7 billion sequentially but up NT$12.8 billion year over year, representing a 2% decline sequentially and a 17% increase annually [15] - EMS business revenues were NT$62.3 billion, declining NT$12.6 billion or 17% sequentially, while increasing NT$2.9 billion or 5% year over year [22] Market Data and Key Metrics Changes - The company noted a potential shallower seasonal dip in EMS business due to customers adjusting order flow patterns [6] - The computing segment within the ATM business saw significant growth, driven by stable high demand for AI products, while handsets and communications devices were seasonally impacted [18] Company Strategy and Development Direction - The company aims to minimize short-term noise to focus on long-term signals, emphasizing the importance of technological trends and process improvements [7][8] - The company is committed to expanding its test business, targeting a market share increase to 19%-20% of overall ATM revenue by year-end [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about volatility impacting long-term planning but remains focused on core industry trends [6][7] - For Q2 2025, ATM revenues are expected to grow by 9% to 11% quarter over quarter, while EMS revenues are projected to decline by 10% year over year [30][31] Other Important Information - The company anticipates a peak in net debt to equity ratio at around 60% in Q3 2025, with total unused credit lines amounting to NT$358.4 billion [25] - Capital expenditures for Q1 2025 totaled NT$892 million, with significant investments in testing operations [26][27] Q&A Session Summary Question: AI test market share increase - Management confirmed that the focus is on expanding market share in AI chip testing, particularly for GPUs, and emphasized the economic returns from test investments [34][37] Question: U.S. investments and capacity - Management is evaluating opportunities for U.S. operations to support customer needs but has not finalized investment details [40][42] Question: Market share in AI testing - Management stated they are a dominant player in wafer sort testing and are aggressively moving into final testing, expecting significant growth in the second half of the year [48][50] Question: Tariff impact - Management indicated that the direct exposure to U.S. tariffs is minimal, with less than 10% of EMS shipments going directly to the U.S. [94][96] Question: General demand outlook - Management noted a gradual recovery in consumer electronics, with automotive demand showing better momentum, particularly in high-end segments [97][98]