Tait Sorensen - STMicroelectronics NV Carlo Bozotti - STMicroelectronics NV Carlo Ferro - STMicroelectronics NV Jean-Marc Chery - STMicroelectronics NV

Achal Sultania - Credit Suisse Securities (Europe) Ltd. Gareth Jenkins - UBS Ltd. Sandeep Sudhir Deshpande - JPMorgan Securities Plc Adithya Metuku - Bank of America Merrill Lynch Jerome Ramel - Exane, Inc. Janardan Menon - Liberum Capital Ltd. Andrew M. Gardiner - Barclays Capital Securities Ltd. Mathias Santos Silva - Morgan Stanley & Co. International Plc Robert Sanders - Deutsche Bank AG Stéphane Houri - Natixis SA Amit B. Harchandani - Citigroup Global Markets Ltd. Lee Simpson - Stifel Nicolaus Europe Ltd. Veysel Taze - ODDO SEYDLER BANK AG Gianmarco Bonacina - Equita SIM SpA

Ladies and gentlemen, good morning or good afternoon. Welcome to the STMicroelectronics Q1 2017 Earnings Results Conference Call and Live Webcast. I am Moira, the Chorus Call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. After the presentation, there will be a Q&A session. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Mr. Tait Sorensen, Group Vice President-Investor Relations. Please go ahead, sir. Tait Sorensen - STMicroelectronics NV: Good morning. Thank you, everyone for joining our first quarter of 2017 financial results conference call. Hosting the call today is Carlo Bozotti, ST's President and Chief Executive Officer. Joining Carlo on the call today are Jean-Marc Chery, Chief Operating Officer; Carlo Ferro, Chief Financial Officer; and Georges Penalver, Chief Strategy Officer. This live webcast can be accessed through ST's website. A replay will be available shortly after the conclusion of this call. This call will include forward-looking statements that involve risk factors that could cause ST's results to differ materially from management's expectations and plans. We encourage you to review the Safe Harbor statement contained in the press release that was issued with the results this morning, and also in ST's most recent regulatory filings for a full description of these risk factors. Also to ensure all participants have an opportunity to ask questions during the Q&A session, please limit yourself to one question and a brief follow up. I'd now like to turn the call over to Carlo Bozotti, ST's President and CEO. Carlo? Carlo Bozotti - STMicroelectronics NV: Thank you, Tait, and thank you for joining us on our first quarter earnings conference call. Our agenda today includes an overview followed by a detail discussion of our results and our outlook for the second quarter. But before starting this detailed review of the quarter you might have seen that this morning we also released the main resolutions proposed to our Annual General Meeting of Shareholders. Among the resolutions, I have accepted to the proposal to extend my role as President and the CEO for one more year, and I am fully committed to drive this company forward. And of course this is with the support of the newly appointed Deputy CEO, Jean-Marc Chery and the strong executive team. Our objective for 2017 is to achieve a sustainable revenue growth and margin expansion through our strategic focus on Internet of Things and the Smart Driving. The first quarter represented a very good start towards achieving this objective. Revenues increased 12.9% year-over-year to $1.82 billion. We saw healthy growth across all our regions, product groups and sales channels. On a sequential basis, revenues decreased 2.1%, which was 30 basis points better than the mean point of our guidance. Gross margin increased 420 basis points year-over-year to 36.6%. We benefited from a strong improvement in manufacturing efficiencies, a better product mix, lower unused capacity charges, and favorable currency effects, partially offset by the normal pricing adjustment at the start of the year. On a sequential basis, gross margin came in at 60 basis points, better than the midpoint of our range on better than expected product mix. Operating income before impairment and restructuring grew by $139 million year-over-year to $134 million in the first quarter driven by higher revenues, improved product mix, manufacturing efficiencies, better fab loading and the set-top box restructuring program. In turn, operating margin before impairment and restructuring reached 7.5% of net revenues. Net income also saw a very strong year-over-year swing of $149 million to $108 million. Free cash flow of $62 million doubled already year ago quarter even with the higher capital investments we are making this year to support our growth plans. We ended the quarter with a net financial position of $518 million, stable compared to the Q4 2016, and up by $79 million from the year ago quarter, another indicator of our progress. Now, let's move to a detailed review of our product groups, beginning with Automotive and Discrete. ADG revenues increased year-over-year by 5.6%, reflecting growth in automotive and strong growth in power discrete products. On a sequential basis, ADG revenues posted a better than seasonal results with a decrease of 1.2%. ADG's operating margin was 5.4% in Q1, substantially stable in comparison to the year ago period. Moving to customer activity, bookings in automotive were robust in the first quarter. Thanks to our focus on technologies and products, enabling greener driving, we had important design wins related to car electrification, particularly in the area of battery management and on-board charging. A number of OEMs worldwide selected products such as our MOSFET, both high and low voltage silicon, as well as silicon carbide, our 32-bit microcontrollers and the lithium-cell balancing device. We also captured the Body Control Unit for a module from an American Tier-1, and the Power Control Unit for a door zone application at a major European Tier-1. We also had a number of important wins related to a more connected and safer driving experience. We started production of a 32-bit microcontroller for embedded security in a next generation automotive gateway. We won an award for a seat belt pre-tensioner application with our 32-bit microcontroller for a major Tier 1 European customer. And we had multiple wins with a parking brake application specific product. In our infotainment portfolio, we were awarded new business to our processors, AM/FM tuners, and the Class AB amplifiers from Japanese Tier-1 for the Asian market. In addition, we had design wins and multiple global Tier-1 for rectifiers, protection devices and automotive-grade IPAD devices for powertrain, on-board charger, ADAS and Safety, and high-speed data line networks. Successes in our power discrete business includes a number of wins in Asia for both high and low voltage power supply applications, and a continued expansion of our business on RF integrated passive devices for the IoT market with several large customers. Moving to our Analog and MEMS Group, AMG, revenues increased 19.9% year-over-year, driven by strong growth in MEMS, continuing the significant progression begun in the second half of 2016. We also enjoyed solid growth in analog products following second half 2016 rebound. On a sequential basis, AMG revenues increased 1.6% better than seasonal with both product areas growing. The strong improvement in AMG product portfolio and competitive position have translated into a significant turnaround in its operating performance over the last two quarters with operating margins of 9.4% in Q4 2016, and 10.1% in Q1 this year, compared to substantially breakeven results one year ago. Our ability to design in multiple products into flagship smartphone and IoT devices was evident during the first quarter. First, we ramped production of several products inside the Samsung Galaxy S8 and S8+ smartphones, including 6-axis ultra-low-power MEMS inertial measurements unit and optical-image stabilization gyroscope, a barometric sensor, a touch controller, and the multifunction protection switch. And in the new and very popular Nintendo gaming system, the Switch, we have motion sensors and the touch controller, as well as multiple STM32 microcontrollers, and Near Field Communication controller from our Microcontrollers and Digital ICs Group. As well, we continue to gain share with motion and the environmental sensors in smartphones and wearables worldwide, but also in communication systems. Automotive is an important focus area for our sensor business. Moving to IoT, we continued the strong design-in momentum in low-power wireless connectivity with our Bluetooth low energy solutions, as well as the SPIRIT sub-1GHz family for home and building automation. During the quarter, we also launched a partnership with USound to produce the world's first piezo-MEMS speaker with excellent sound quality, targeting IoT applications. In smart industry, we broadened our customer base for our STSPIN32 motion control family, including multiple designs for our newly introduced intelligent motor control devices. We also started production for a 6-axis inertial sensor for high-end industrial applications. In addition, we won multiple designs for a range of analog products for the next-generation smart metering solutions. Our broad analog portfolio strongly complements our other product families, allowing us to design-in more silicon content across our customer base. Now, let me share some highlights on our Microcontrollers and Digital ICs Group. MDG saw a strong progression, with revenues increasing year-over-year by 11.4%, or 14.6% if we exclude discontinued businesses. Key drivers were strong growth in general purpose microcontrollers and growth in digital products. MDG's operating income and margin also had very positive swing, with its operating income up $64 million year-over-year, and its operating margin of 10.2% in the first quarter. With our general purpose microcontrollers, we again set a new quarterly revenue record. With a goal to continue the momentum going forward, we introduced new products for our existing STM32 families, including new STM32L4 MCUs, adding larger memories, enhanced graphics support, and increased power-saving flexibility. We continued to expand the STM32 ecosystem with tools from STM partners. For example, we teamed with DSP Concepts to offer STM32 users free access to an advanced audio design tool. We also introduced the MCU Finder for PC desktops, a new STM32F7 Nucleo board and Discovery kit, a new STM32 board to evaluate low-power, long-range IoT connectivity. Getting our development tools into the hands of embedded developers is a key step in the design-in process. And, with over 1 million STM32 development kits now shipped to the market, we are on the right track to expand our base of over 40,000 customers. Moving to security; we announced the availability of the new advanced Near Field Communication ST20NFCD (sic) [ST21NFCD] (14:50) controller, integrating the recently acquired booster technology. This product was already awarded a design win with a major OEM. We also launched a new STSAFE solution to secure devices connected to the Sigfox low-power wide-area network. And we teamed with Giesecke and FitPay Mobile-Payment to offer a solution to integrate tokenized payments from Mastercard or Visa on wearable devices. Benefiting from our recent acquisition, we captured a key win for our ST25 Near Field Communication reader portfolio at a major car OEM. We also introduced dynamic-tag ICs that support higher speed and greater distance RFID. Also in this area, we are focused on making our products easier for our customers to evaluate and design-in, and we introduced a new ST25 Discovery kit that accelerates time-to-market for NFC applications. To complete the review of our products, let's now discuss our Imaging Product Division, which we report in Others. Imaging revenues in the first quarter more than doubled, to $72 million, compared to the year-ago quarter, driven by ST's innovative Time-of-Flight technology. We had multiple new design wins and continued high-volume shipment of Time-of-Flight ranging sensors to leading smartphone manufacturers. During Q1, our FlightSense technology was integrated in seven new smartphones launched by Asian brands. We also announced a new generation of Time-of-Flight sensor which brings multi-object detection and multi-array scanning to mobile applications. Turning now to our second quarter guidance, we expect to make further progress in revenue and margins. We continue to see strong bookings across all product groups and regions. A careful analysis of point-of-sales data, or sales through distribution, continues to indicate a very healthy demand environment. Therefore, based upon our current visibility, we expect the sequential revenue growth of about 5%, which translates to year-over-year growth of 12.3% at the midpoint. We are targeting a gross margin of about 38.1% at the midpoint. Taking these two data points, it is clear that we see the opportunity in Q2 to deliver substantial year-over-year and sequential growth in operating income and net income. Looking further ahead, we are continuing to prepare for a major program introduction. As anticipated, there is no revenue contribution from this program in our Q2 guidance, and we are on track to ramp substantial revenues in the second half of this year. More broadly, our investments to scale up production in 12 inches, our 6-inch to 8-inch fab conversions, and our technology evolution will help drive wafer cost reductions, benefiting all product groups. Finally, today ST's Supervisory board is proposing to shareholders to declare a cash dividend of $0.24 per share payable in four equal quarterly installments starting with the second quarter of 2017. The 2017 Annual General Meeting of Shareholders is scheduled for June 20, 2017. And my colleagues and I will now be happy to take your questions. And we look forward to meeting with you on May 11 at our 2017 Capital Markets Day in London. Thank you.

The first question is from Achal Sultania from Credit Suisse. Please go ahead. Achal Sultania - Credit Suisse Securities (Europe) Ltd.: Hi. Good morning, everyone. Just a clarification on the MEMS business. I think you talked about the several chips being used in the Galaxy S8 and S8+ devices. I think in some of those sockets, in the past you've shared that chip with some other supplier because that device has had two variants, one with Qualcomm chip and one with Exynos chip. Can you give us some color as to whether that is still continuing with S8 and S8+, or are you becoming more of a sole supplier in some of those sockets in this generation? Carlo Bozotti - STMicroelectronics NV: Well, of course, it's difficult for me to comment on such detailed question. But the impression that we have is that certainly our share is lion's share. Achal Sultania - Credit Suisse Securities (Europe) Ltd.: Okay. But if the share is not changing, it's lion's share, but it's not changing from last year. Is that the right way to think about it? Carlo Bozotti - STMicroelectronics NV: Well, you can see, if the share is 100%, it's difficult in general to change. Achal Sultania - Credit Suisse Securities (Europe) Ltd.: Okay. Thank you. And one question on the automotive side of things. I think you've talked about bookings being strong in Q1. I think we're starting to see some data points that China obviously was very, very strong last year, and the year-on-year comps are a bit difficult as we go into Q2, Q3 of this year. Are we seeing any signs of that as yet in the bookings number, or you think that the content increase is enough or is accelerating, which will offset any slowdown in volume growth? Is that the case, or are you not seeing any volume slow down as yet? Carlo Bozotti - STMicroelectronics NV: No. It's the opposite. We see an acceleration of our business in the automotive. Q1, it is certainly a low point for automotive, and we expect to grow significantly. Overall, I also want to make the point that we have, on top of ADG, other products that we sell to automotive customers, of course, including our sensors, and including our digital products (22:55). So they are important products that we sell to our automotive customers that we do not report in ADG. And overall, I want to make sure it's clear, our ambition is to grow significantly this year in the automotive business. And certainly, we do not see any slowdown and we see an acceleration of our automotive business moving from Q1 to Q2 and the rest of the year. Achal Sultania - Credit Suisse Securities (Europe) Ltd.: Okay. Thanks. Thanks a lot, Carlo. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Achal. Next question?

The next question is from Gareth Jenkins from UBS. Please go ahead. Gareth Jenkins - UBS Ltd.: Thanks. Just a couple if I could. The CapEx run rate looks like it's tracking slightly below your full year guidance. So just wondered whether you're finding more efficiencies in CapEx than you thought, or whether we should expect a pick up through the rest of the year, and then I have a follow up. Thank you. Carlo Bozotti - STMicroelectronics NV: Carlo will take this. Carlo Ferro - STMicroelectronics NV: Thank you, Carlo. Good morning, everyone. Now, I will not read the first quarter number as a sign on the run rate (24:08) for the year. We are absolutely on track on the plan of $1.1 billion CapEx spending for the year. We are in the process now to look at the volume and the capacity needed for second half of the year entering 2018. So in this respect, at this stage, I believe you may continue to make reference to the previous guidance. We will meet in a few weeks at our Capital Market Day. That could be an opportunity eventually to tune the numbers, but please do not consider the number of the first quarter as a sign not to be at the high of the range for this year. And capacity (24:49) is what needed in order to serve business and increase the revenues significant for the second half of the year. Gareth Jenkins - UBS Ltd.: That's great. Thank you very much. And just as a follow up, can I just have a follow up take on the under saturation charges, presumably zero in the last quarter and zero going forward from here from that statement? Carlo Ferro - STMicroelectronics NV: Yeah. Very minor, in both cases we are running with the fab almost all at full loading. We are in the process of increasing capacities, improving the service to customer, and building higher revenues for the next quarters. Gareth Jenkins - UBS Ltd.: Thank you. Carlo Ferro - STMicroelectronics NV: You're welcome. Tait Sorensen - STMicroelectronics NV: Thank you, Gareth. Next question, please?

The next question is from Sandeep Deshpande from JPMorgan. Please go ahead. Sandeep Sudhir Deshpande - JPMorgan Securities Plc: Yeah. Hi. Thank you for letting me on. My question is regarding the next-generation technologies in 3D sensing. You have some technologies associated with 3D sensing. Can you, Carlo, possibly help us understand what technology you have associated with this? And is it purely sensing technologies, or are you also selling digital chips associated with this? Secondly, my question is regarding the CapEx you announced earlier this year. What percentage of the CapEx are you spending on front-end versus back-end? Thank you. Carlo Bozotti - STMicroelectronics NV: Okay. Our activity in this field is very broad, and I think, Jean-Marc will comment here. And then, Carlo will take the second question. Jean-Marc Chery - STMicroelectronics NV: So Jean-Marc speaking. So more basically to make history as simple as possible for 3D sensing, we see really two technologies which are key enablers, is what we call structured light; and the second one, we call Time-of-Flight technology, and in Time-of-Flight, it was direct or indirect Time-of-Flight. What I can say at this stage is that, ST from silicon point of view, we own, we develop, we control, we are able to make the manufacturing of all technologies which are key, whatever is the Time-of-Flight or the structured light. Then, in term of module assembly of the key module linked to this technology, we completely control the technology in term of module assemblies. We have the skill to manage all the critical components which are related to the structured light, and we are able to make the manufacturing of the module. So ST is completely well positioned with his specialty imaging strategy to address this market of 3D sensing, whatever are the technology, Time-of-Flight or structured light. Sandeep Sudhir Deshpande - JPMorgan Securities Plc: Sorry. I have one follow up on that, Jean-Marc, which is, does your technology require a separate digital chip beyond the sensing module that you will sell? Jean-Marc Chery - STMicroelectronics NV: Of course. Okay. You need to have a digital chip to embed the software because structured light is very complex request in term of software. So you have the separate chips, digital chips to receive the signal from the various component and create the 3D image. Sandeep Sudhir Deshpande - JPMorgan Securities Plc: And do you supply that digital chip as well? Jean-Marc Chery - STMicroelectronics NV: No. Sandeep Sudhir Deshpande - JPMorgan Securities Plc: Okay. Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Sandeep. Next question? Carlo Ferro - STMicroelectronics NV: I guess, Sandeep has a second question on the capital spend in this year between front-end and back-end. When taking front-end manufacturing and R&D this is about 55%. Probing, assembling and testing will be about 45%. Sandeep Sudhir Deshpande - JPMorgan Securities Plc: Thank you, Carlo Ferro. Carlo Ferro - STMicroelectronics NV: You're welcome. Tait Sorensen - STMicroelectronics NV: Thank you, Sandeep. Next question?

The next question is from Adithya Metuku from Merrill Lynch. Please go ahead. Adithya Metuku - Bank of America Merrill Lynch: Yes. Good morning, guys. So my question is firstly a clarification. Could you give us some highlight on the growth rates in the automotive, microcontroller and Analog and MEMS businesses in the past quarter? And then I have a quick follow up on OpEx. Carlo Bozotti - STMicroelectronics NV: So the first question is about the growth rate on automotive. Adithya Metuku - Bank of America Merrill Lynch: Automotive, microcontroller and Analog and MEMS. Carlo Bozotti - STMicroelectronics NV: Right. So I think we can go through Carlo, we'll go through family-by-family if you – we have all the data, of course. Carlo Ferro - STMicroelectronics NV: Your question is in reference to which period, the first quarter? Adithya Metuku - Bank of America Merrill Lynch: Yes. First quarter. Carlo Ferro - STMicroelectronics NV: Okay. It's in the press release, right? Adithya Metuku - Bank of America Merrill Lynch: No. I don't mean the groups. I mean automotive within the division that you disclosed. Carlo Ferro - STMicroelectronics NV: Okay. So I believe that the answer, the best way for characterizing it is that in the area of ADG, both automotive and the power and discrete enjoyed better than seasonal trend overall. Then in the case of AMG, it has been another strong quarter for MEMS, but also a stronger quarter for analog. And certainly in the field of MDG, you may have noted there is some further erosion in the area of the digital business and the legacy business there, while general purpose microcontrollers remain particularly solid. Adithya Metuku - Bank of America Merrill Lynch: Okay. My quick follow up is on OpEx, Carlo Ferro. Could you give us a bit of color taking into the current spot rates what you expect in terms of growth in net OpEx in the next quarter and then the second half of the year? Thank you. Carlo Ferro - STMicroelectronics NV: Yeah. We remain on our target to maintain, in average, the net OpEx in the range of $550 million. We have anticipated that there is some unbalance quarterly due to seasonality, particularly third quarter is cheaper in seasonality, if I can use the word. Second quarter and fourth quarter a bit higher. So I would basically (31:45) between $550 million to $560 million net operating expenses in the second quarter. Adithya Metuku - Bank of America Merrill Lynch: Okay. Thank you. Tait Sorensen - STMicroelectronics NV: Next question, please?

Next question is from Jerome Ramel from Exane BNP Paribas. Please go ahead. Jerome Ramel - Exane, Inc.: Yeah. Good morning. A question on automotive in Q1, I mean, Automotive and Discrete you were up 5.6% year-on-year, and you mentioned that discrete grew faster. So my question is, why the automotive growing not in line with peer, because peer is quite distant to peer in Q1 (32:24) year-on-year, much more than 5.5%. So do you think you're losing market share, or do you see you're going to have an acceleration in, as you mentioned before, in the second half of this year? Thank you. Carlo Bozotti - STMicroelectronics NV: Well, I think, first of all we need to look at the perimeter. As I said, I mean, there will be a strong acceleration of the growth, and this will be across the board for all automotive products. It will be on what we traditionally called APG, which is smart power and microcontrollers and digital automotive. It will be on Power MOS, it will be on SiC, and it will be also on our MEMS, for instance, for automotive applications. And the visibility that we have today for the automotive growth year-over-year is far above the 5.6% that you mentioned. Jerome Ramel - Exane, Inc.: Okay. And maybe a follow up. I had in mind that your MEMS business for automotive was about $150 (33:42) million per quarter. Is that the right number? Carlo Bozotti - STMicroelectronics NV: Well, this is a very detailed question. We are growing significantly. I think it still is below $100 million. Jerome Ramel - Exane, Inc.: Okay. Thank you very much. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Jerome. Next question?

The next question is from Janardan Menon from Liberum Capital. Please go ahead. Janardan Menon - Liberum Capital Ltd.: Hi. Good morning. Thanks for taking the question. Just going back to a comment that you made that your CapEx in the second half will also depend on what the volume expectations are, et cetera, and you talked about the significant ramp in the second half of revenue. I was just wondering, what is the visibility that you have on that? I mean, is it that you are yet to get your purchase orders and your purchase orders will come later on, and that will give you a better feel for what that revenue ramp will look like, or do you already have a pretty good feel for how that will look like, in terms of volume and ASP? And if there is any sort of movement in that number, is that mainly from a back-end CapEx point of view, or would you consider adding front-end CapEx as well in the second half, if the volume required for that? And second question is, at your Mobile World Congress presentation, I think there was a comment saying that you had a $1 billion run rate on IoT microcontrollers. I was just wondering, can you put together a number for what is your IoT revenue at this point in time, if you go through all the different divisions, and what would you say the ballpark figure of growth for that business right now? Carlo Ferro - STMicroelectronics NV: Maybe Janardan, I take your question quite quickly, to refer like (35:31) Carlo said during the introduction, that the demand environment is very solid, and we enter really the next quarter with a very solid backlog. On the rest of your question, you really want, Janardan, to spoil our Capital Market Day? Let's have a little bit of content to come on May 10 on the second half of the year. Janardan Menon - Liberum Capital Ltd.: Okay. Can I get one more... Carlo Bozotti - STMicroelectronics NV: (35:56) maybe one comment. The visibility is pretty good. And I think, in this moment, we discussed automotive. I think the visibility that we have, in general, with our automotive customers is to grow much faster than the 5.6%. The POS and distribution is at a record level, and inventories are low. And we are perfectly on track with our new major programs. So the three things are working well. So I think we have good confidence to make a substantial step in revenues, moving from Q2 to the second half of the year. Janardan Menon - Liberum Capital Ltd.: Understood. Thank you Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Janardan. Next question, please?

The next question is from Andrew Gardiner from Barclays. Please go ahead. Andrew M. Gardiner - Barclays Capital Securities Ltd.: Hi. Good morning, gentlemen. Thanks for taking the question. Not to belabor the point too much on the second half visibility. But you mentioned the sort of key product ramp for the back half of the year, I think sort of on the sensing side of things. You've also highlighted in the past silicon carbide ramp. Just, how's your visibility there, in terms of so the key customer starting in the back half of the year? And also, can you perhaps shed a little bit more light about engagement elsewhere? I think you said you had a win in Asia for silicon carbide. Just how you expect trends to progress there for 2018 and 2019, based on customer engagement? Carlo Bozotti - STMicroelectronics NV: We are, first of all, in the condition to confirm the ramp, which is not a major program that we have described. And this program is also, as we already said, is also calling for important capital investment. The silicon carbide is an important contributor in the second half. Is starting, I think is pretty nowadays (38:16) because it is high volume, and we are very proud about this growth on silicon carbide. And we see an acceleration of design wins on silicon carbide products. In the press release, we mentioned this design award in Asia, but there are many things moving on also in Europe. This is, I believe, important to underline. So it is a new generation of products, and of course, there will be a contribution in the second part of this year. But we are confident that this contribution will grow materially the next few years. Andrew M. Gardiner - Barclays Capital Securities Ltd.: Thank you, Carlo. Carlo Bozotti - STMicroelectronics NV: Yes. Tait Sorensen - STMicroelectronics NV: Thank you, Andrew. Next question, please?

The next question is from Mathias Santos Silva from Morgan Stanley. Please go ahead. Mathias Santos Silva - Morgan Stanley & Co. International Plc: Hello. Thank you for taking my question. First, regarding to the CapEx ramp, is this entirely related to models to be launched this year, or is there also some in there regarding models to be launched next year? And also, in the application that's going out in the market in the second half that will drive that revenue ramp, do you forecast that kind of application going into broad-based smartphone manufacturers as well, or is it mostly related to that one customer perhaps? Thank you. Carlo Bozotti - STMicroelectronics NV: Well, CapEx (39:39). Carlo Ferro - STMicroelectronics NV: Yeah. On CapEx, as you could expect at the end, intense capital spending is, at the end, addressing all the, I'll say, three relevant objective for us, which is to start the new program in the second half of the year, is to build capacity for expanding revenues in the second half of the year, and preparing a capacity for 2018. And this is almost across all the different process technologies for the company, and to serve a growth for all the three product groups in the Imaging division, or the subset of our business. Carlo Bozotti - STMicroelectronics NV: Yeah. To respond to the second question, when we talk about this major project, of course, it's not one single device. This is obvious. And some of the products are certainly suitable for many, many customers, while some other products are more dedicated to one customer. Mathias Santos Silva - Morgan Stanley & Co. International Plc: Okay. Thank you for that. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Mathias. Next question?

The next question is from Robert Sanders from Deutsche Bank. Please go ahead. Robert Sanders - Deutsche Bank AG: Yeah. Good morning. A question for Jean-Marc. You mentioned you had a capability in structured light. I was just wondering what capability you have today in wafer level optics, or are you partnering with firms like CDA (41:32) or Hynix? And then the second question would just be on the Time-of-Flight. You've launched a multi-object, multi-array scanner. I was just wondering what kind of level of increase of content that could generate versus your simple SPAD-based proximity sensor today. Just a sort of multiple would be interesting. Thanks. Jean-Marc Chery - STMicroelectronics NV: Now, what is important when you would like to control this kind of technology is to have the skill, the technical skill in the critical component. Of course, in structured light one of the critical components is disfactored (42:12) optical elements, and you mentioned Hynix. Of course, Hynix (42:18) is one of the key supplier in the world. What is important for us is to have the technical skill to understand what are the best components and the best offer in the world. It is an example. Then, you have the voxel. Voxel, there is many voxel (42:37), many power, different power for Time-of-Flight, for structured light. For us, it's important to have the skill to be able to know very well the process, to assess the capability of the values (42:55) and to challenge it. (42:59) there is also a component like that, like the filters, lens and so on and so forth. So ST, we have built in our Imaging division, very strong capability to understand this key components from the bill of material to challenge (43:16). And then, one of the key capability we have is engineering and manufacturing capability to assemble and test all these components in a module. By the way, this is what we have demonstrated last year, with one component for (43:37) customer we have delivered in the course of 2016. So really, we have a good control of the supply chain, and we have a good control of the manufacturing of this kind of module. But then from silicon point of view, means the sensors of the Time-of-Flight all-in-one technology that year we have, this is our core competence in term of silicon footprint, and we know the technology. We are very good on that, very aggressive on that, and we position ourself for future generation. Robert Sanders - Deutsche Bank AG: Great. That's helpful. And just on the Time-of-Flight, I think the current proximity sensors is only a $1 component, the one you shipped into the iPhone. But I would assume, with an array, these multi-point Time-of-Flight sensors are significantly higher. Do you have a sort of rough estimate of how much more content this could generate? Carlo Bozotti - STMicroelectronics NV: Well, we cannot comment on the price. Of course, price and complexity are related, and also I do not want to comment on the price of the existing solution. You mentioned it, so certainly not possible for us to comment on the price. But clearly with more content, more complexity, the evolution of the price is in the right direction. Robert Sanders - Deutsche Bank AG: Okay. Thanks a lot. Carlo Bozotti - STMicroelectronics NV: Thanks. Tait Sorensen - STMicroelectronics NV: Thank you, Rob. Next question, please?

The next question is from Stéphane Houri from Natixis. Please go ahead. Stéphane Houri - Natixis SA: Yes. Hello. Good morning. Carlo Bozotti - STMicroelectronics NV: Good morning. Stéphane Houri - Natixis SA: I have a question on gross margin because you commented that the unused (45:25) charge is very limited. So what are the ways to improve the gross margin going further, and what's the potential? Thank you. Carlo Bozotti - STMicroelectronics NV: Well, Carlo will comment. I will say, the potential is significant. Carlo Ferro - STMicroelectronics NV: Again, you note, Stéphane, that already in the guidance for the next quarter we are anticipating at midpoint of the guidance another step of progression. I believe really what is nicely coming in as a factor there is that the innovation is making product mix able to somehow compensate the natural, or be till the future of (46:13) the natural price erosion in the industry, and the gross margin can take advantage of higher efficiencies. And efficiencies, of course, is a function on the volume of the fab, not only in respect to the absorption of the unused capacity charges that now is fully done, but also in respect of the big opportunity of scaling up capacity in the fab going forward. When we have entered the year, we have anticipated for the second half of the year a very significant contribution to the wafer cost, particularly in 300-millimeter from scaling up fabs also associated with the new program, and this has really to come for the second half of the year. Stéphane Houri - Natixis SA: Okay. Thank you. And just a follow up, if I may. Looking at your Q2 guidance of 5% growth, could you give us some indication about what's going to happen into the different division which is going to fastest growing and the one who will grow less? Carlo Bozotti - STMicroelectronics NV: Yeah. Carlo? Carlo Ferro - STMicroelectronics NV: As usual, without characterizing specifically growth by sub-groups, I may indicate to you whether we expect more solid growth sequentially for the next quarter, and this is certainly about the automotive and the micromemories, and secure microcontrollers, is in its second level for power discrete and analog. And in the case of digital, will be a further slight erosion associated with the phase out of legacy. Stéphane Houri - Natixis SA: Okay. Very good. Thank you very much. Carlo Ferro - STMicroelectronics NV: You're welcome. Tait Sorensen - STMicroelectronics NV: Thanks, Stéphane. Next question?

The next question is from Amit Harchandani from Citigroup. Please go ahead. Amit B. Harchandani - Citigroup Global Markets Ltd.: Good morning. Amit Harchandani from Citigroup, and thanks for taking my question. Two, if I may. My first question would be around trends in the distribution business and also inventory levels across the supply chain. Could you maybe share your thoughts in terms of the segments? How you've seen the trends in distribution evolve as you've gone through the quarter? And maybe some initial thoughts on the month of April. And then I have a second question after that. Thank you. Carlo Bozotti - STMicroelectronics NV: The visibility, well, first of all, we know, while Q1, and I can say that it was unprecedently strong POS with a very healthy situation, and this is across the board. I have to say that Asia is strong, but Europe that is important for us in distribution of growth, is also very, very strong, even stronger than Asia. And we do not see any change in April. We see a very good trend in the month of April, both in terms of bookings and in terms of POS. I would like to underline again that the situation of inventory is pretty healthy. And of course, what we are trying to do here, for instance, yesterday and the day before yesterday, we had a major event in China on our STM32. We had 2,000 participants to this event, and this is mostly developers, people working with our microcontrollers and building around our microcontrollers with other products. And this is exactly what we want to do, we want to sell more around our STM32. So we are encouraged by this trend. So we see a good momentum. It was strong in Q1. I think somebody mentioned before that our general-purpose microcontroller, it was $1 billion business or so before. I think, today the run rate is more, $300 million per quarter and growing. And this is, I believe, it is a fundamental family for our mass market strategy and for our distribution business. We want to sell more of the rest of our kits together with our STM32. So pretty good visibility in distribution. Amit B. Harchandani - Citigroup Global Markets Ltd.: Thank you for the detailed comments, Carlo. And maybe as a second question, I was looking at the press release this morning with respect to the proposal for the new executive team, and the creation of the position of Deputy CEO. Just wanted to understand your thoughts behind coming up with this new executive team structure. Is it in response to what you see out there in the industry? And also, should we maybe look at the creation of a Deputy CEO position as a step in the succession planning, thinking one year from now, or am I getting a ahead of myself? Thank you. Carlo Bozotti - STMicroelectronics NV: Yeah. Well, I think, first of all, I believe this is a unique opportunity for Jean-Marc. We've been working with Jean-Marc, it's now many, many years, in fact, since the moment of creation of the company in 1987. So it's certainly an important step for Jean-Marc. I mean, Jean-Marc in his career managed manufacturing, technology, certain products, and this is a unique opportunity to expand. We mentioned in our press release that there will be a more stronger involvement of Jean-Marc in sales and marketing. So I think he's well deserved. Times are (52:59) getting better, and Jean-Marc gave an important contribution, very important contribution in the turnaround in this area. Having said that, it's certainly not up to me to comment on the succession. This is not a matter that is discussed at the level of management, but is of course, is our Supervisory Board. Amit B. Harchandani - Citigroup Global Markets Ltd.: And just the rest of the executive team structure, the changes there, I just wanted to understand the thought process behind that, (53:30). Carlo Bozotti - STMicroelectronics NV: Well, there are basically two changes; one change is the unification (53:40) of the regions. I think (53:45), of course, all the organizations can work very nicely or maybe a little bit less. But I think we believe this is the right moment to make the steps. Some of our customers are, of course, very, very global, and this including some of our distributors, our presence with distributors is becoming more and more important. And of course, we also want to make sure that there is a very good global approach in what we do with our global distributors. And the other one is somehow related to the promotion of Jean-Marc, and the promotion of Orio Bellezza that is taking also the digital technologies on top of what he already has in terms of power and analog technologies. The rest is basically continuation, and I think he is actual evolution (55:01). I think, of course, the role of Jean-Marc is unique for all. And I am sure that we will continue with the turnaround. We are better, but certainly not at the level we want to be. And there is the opportunity to make another important steps in the second half of this year. And well, if you do first of all, then in the second half of this year, and of course, also in 2018. Amit B. Harchandani - Citigroup Global Markets Ltd.: Thank you very much, Carlo. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Amit. Next question?

The next question is from Lee Simpson from Stifel. Please go ahead. Lee Simpson - Stifel Nicolaus Europe Ltd.: Great. Thanks for letting me on there. Maybe if I just circle back to OpEx, if I could, and SG&A, in particular. SG&A looked pretty steady last year, but going into Q1, things have picked up perhaps a little higher than just my modeling. But just trying to get a sense for how that pans out to the year. And I'm looking in particular for comments as they relates to restructuring. I mean, obviously restructuring has been heavy for last two years. I just wonder, if the restructuring charges having now peaked means the SG&A, the downside, or the ability to push SG&A down has maxed out already. Thanks. Carlo Ferro - STMicroelectronics NV: I believe the short answer to your question is, the status of progression in the set-top box restructuring (56:39) now at the stage that most of savings are already in, about 74% of the targeted savings are already in the result of the first quarter. And certainly, the portion still to go is the one that could help going forward to reabsorb the normal inflation dynamic in expenses, some strengthening of our firepower (57:09) in sales and marketing. So at the end, as anticipated when we talked in January, we see the combination of the completion of the restructuring plan and other ingredients to be substantially offering the company the possibility to keep expenses in this range of the $550 million net per quarter on one side, and on the other side doing so, taking a full advantage to the operating margin from the top line growth. Lee Simpson - Stifel Nicolaus Europe Ltd.: Great. I guess, in summary, we can expect some further savings in R&D as a result. Carlo Ferro - STMicroelectronics NV: Again, what we could expect going forward in the next quarter is expenses, and (57:57), operating expenses to be substantially flattish. This is also what we are anticipating with the visibility of the second quarter. That will be a few million higher than the first quarter and the third quarter. That will be some millions lower than the second quarter and the first quarter. Lee Simpson - Stifel Nicolaus Europe Ltd.: Got you. That's very clear. And maybe just circling back to the earlier question, I think this one goes to Jean-Marc, you were very good at giving us detail around the expansion to an array solution in Time-of-Flight. But you step back from giving the ASP increase. In the absence of giving us an ASP increase, could you give us perhaps the silicon area increase? Carlo Bozotti - STMicroelectronics NV: This is even worse. Lee Simpson - Stifel Nicolaus Europe Ltd.: Well, I guess, if we can get a ratio on the array itself. I mean, are going from a 0.4 by 0.4 (58:53) to a 1 millimeter squared solution? Is that the way to look at this? Carlo Bozotti - STMicroelectronics NV: No, we cannot comment. Also of course, it's never that clear whether we are talking about exactly the same thing. It is about the evolution of the Time-of-Flight, or is a more complex chipset. I already mentioned that we are not talking about one product here, and I think it's very, very complex. What I can say is that this is a unique capability that we are (59:36) and, of course, we want to (59:38) on this capability. And it is coming from all of these specialty technologies that we have developed in imaging, and we want to have a very, very important return. And now, we are in the phase of the ramp up. We are on track, and I'm sure we can give more information, of course, during (1:00:18). Lee Simpson - Stifel Nicolaus Europe Ltd.: Great. Thanks anyway. Thank you. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: So stay tuned, Lee. Thank you. Next question, please?

The next question is from Veysel Taze from ODDO. Please go ahead. Veysel Taze - ODDO SEYDLER BANK AG: Yeah. Hi. Good morning. Thank you for taking my questions. I have one question regarding your MEMS business. It was a little bit difficult to read the development in the MEMS business if you look at the inventory – or the news flow from China about inventory correction there, et cetera. But your MEMS business has grown very strong in Q1. I see the point that, Samsung, you had one additional design win versus the prior generation with the touch controller. Was that the main driver, or are there other factors which drove the business here? Carlo Bozotti - STMicroelectronics NV: The touch controller is not reported in the MEMS. The touch controller is reported in our Analog. So there is no relation. I mean, of course, it's reported in AMG, but you talk about MEMS. So I wanted to be accurate. Now, what we see, MEMS, it is strong demand, the month of March was pretty strong bookings. I have to say that in February, with the Chinese New Year, it was a correction, but very, very strong March booking on MEMS. Carlo mentioned before that we will grow sequentially on MEMS, moving into Q2, so the growth year-over-year will be substantial growth. And the priorities are always the same. I think we wanted to diversify this business, diversify in terms of technologies, so not only MEMS sensors, but also MEMS micro-actuators. We want to diversify in terms of customers. So you mentioned Samsung, but we want to be more spread with many customers, including important customers in China. And we, importantly, want to diversify in terms of market segments. And I mentioned before that what we do in MEMS for automotive is not yet the level, I believe, of the potential that we have in this area, and this is certainly an important priority. So I tried to give you the three axes; diversification in terms of technology, diversification in terms of customer base, and diversification in terms of market. The momentum is good, and we see a good trend. The month of March was pretty strong, and the demand is strong. Veysel Taze - ODDO SEYDLER BANK AG: Sorry. I think I missed – the touch controller is part of which segment? Carlo Bozotti - STMicroelectronics NV: Analog. Veysel Taze - ODDO SEYDLER BANK AG: Okay. And second question, regarding the gross margin, and what Carlo Ferro mentioned regarding the scaling up of the volumes and the fabs. If I look your gross margin profile, first half this year versus first half of last year, so it seems like around 400 basis points year-over-year growth. So the question would be, what could be the kind of leverage you're trying to get in the second half of the year as indication? I mean, last year, you had roughly 37% in second half of the year. Is there – what would be like the opportunity there? The 400 basis points, I guess, in first half would be too high. Carlo Ferro - STMicroelectronics NV: You see, for the time being, it's nice to see that now is several quarters in a row that each quarter, gross margin is (1:04:45) 4 points higher than the prior year quarter. Carlo Bozotti - STMicroelectronics NV: So, we cannot give the guidance for Q3. I think, as I said, we believe there are significant opportunities. Carlo mentioned already very well, I mean, what is the effect and all, (1:05:10) that is a very important thing to do. Due to the turn of inventory, we'll have a positive effect in Q3, starting from Q3. Veysel Taze - ODDO SEYDLER BANK AG: One final one on your auto business, if I may. In the auto business, you mentioned that growth will accelerate for the rest of the year. And if I look at the growth in Q1, it was above 5% year-end. But nevertheless, if I look some of the peers, they are expecting for this year double-digit growth in their auto business. And also Q1 for some of them, look really stronger than your Q1. So any indication how strong this acceleration could be? So could we move into double-digit range or high single-digit? Carlo Bozotti - STMicroelectronics NV: Yeah. Well, my comment before was year-over-year. And I was saying that when we compare with others, we need to take in consideration also the organization of the company. And we have products that are important products for automotive that are maybe not in ADG or in APG (1:06:41), particularly. For instance, let's make a couple of examples. The silicon carbide growth is certainly for automotive, and this will be in ADG. It will be in the discrete part of ADG. We expect a strong growth on digital in the automotive. And this will be in what we call ADG (1:07:10), that is still part of ADG. But there are other families, very important families for us in the automotive. As I mentioned before, it's of course, MEMS. There are other companies that are reporting the sensors for automotive together with the business segment. For us, of course, is automotive in terms of customers, and this is going to be reported under MEMS. And so if you put all together year-over-year, we want to be close to double-digit growth. Yes. Veysel Taze - ODDO SEYDLER BANK AG: Thanks a lot. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Veysel. Based on time, we'll take one more question, Moira.

The last question is from Gianmarco Bonacina from Equita SIM. Please go ahead. Gianmarco Bonacina - Equita SIM SpA: Yes. Very good morning. Just a quick one about car electrification. You mentioned new design wins in Q1. I read in the press release, in particular, there is one on SiC MOSFET with Asian OEM. Can you give a little bit more detail? Is this in Japan or in China? And then more broadly, can we say that the bill of material for you is pretty similar, either if it's hybrid or a pure electric, or let's say, on average, there is in lot of (1:08:44) because we are basically trying to track the announcement in terms of new products from the different OEMs. Thank you. Carlo Bozotti - STMicroelectronics NV: Well, first of all, on the customer, every time we can mention the customer, we tend to do. When we cannot, we are not in the position of comment on the customer name, and we do not do. I think what is important for us is the two applications; one of course is the inverter; and then it's the system that is driving the electric model. And our proposition here, of course, is to start replacing IGBT with our SiC Power MOS. And there are many, many Power MOS per inverter. And now, I cannot say the number, but there are many, many Power MOS per inverter, tens of Power MOS per inverter. And this is one opportunity. Every time there is an inverter, so every time there is an electric model in the car, so of course, including hybrid, there is another application where we believe that the SiC is also a very good solution, is the on-board charger. And I think our products are suitable both for the inverter and the on-board charger. For the customer, I've been told the other day, maybe I can say the region, not the customer. Yeah, I can say the region of the customer, so it's China. Gianmarco Bonacina - Equita SIM SpA: Okay. Thank you. Carlo Bozotti - STMicroelectronics NV: Thank you. Tait Sorensen - STMicroelectronics NV: Thank you, Gianmarco. Tait Sorensen - STMicroelectronics NV: At this point, we'll go ahead and wrap up. And as Carlo mentioned earlier on, we will have our Capital Markets Day on May 11 in London. If you need any information on that, please contact Investor Relation. And again, thank you for participating. Carlo Bozotti - STMicroelectronics NV: Thank you. Carlo Ferro - STMicroelectronics NV: Thank you.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call. And thank you for participating in the conference. You may now disconnect your lines. Good-bye.