Badger Meter, Inc. (BMI) 2026 Q3 法說會逐字稿

Ladies and gentlemen, welcome to the third quarter 2026 Badger Meter earnings conference call. (Operator Instructions)

各位女士、先生，歡迎參加 Badger Meter 2026 年第三季財報電話會議。(接線員指示)

It is now my pleasure to turn the conference call over to Dan Weltzien, Chief Financial Officer and Treasurer. Please go ahead, Mr. Weltzien.

現在我很榮幸將電話會議交給財務長兼財務主管 Dan Weltzien。Weltzien 先生，請開始。

Good morning. Thank you for joining the Badger Meter third quarter 2026 Earnings conference call. I'm here today with Ken Bockhorst, our Chairman, President, and Chief Executive Officer; and Bob Wrocklage, our Executive Vice President of North America Municipal Utility.

各位早安。感謝各位參加 Badger Meter 2026 年第三季財報電話會議。今天與我一同出席的有：董事長、總裁暨執行長 Ken Bockhorst，以及北美市政公用事業執行副總裁 Bob Wrocklage。

This morning, we posted the earnings release and related slide presentation on our website. As a reminder. Any forward-looking statements made on this call are subject to various risks and uncertainties, most important of which are outlined in our news release and SEC filings.

今天早上，我們已在公司網站發布財報新聞稿及相關簡報投影片。提醒各位。本次電話會議中的任何前瞻性陳述均受各項風險與不確定性影響，其中最重要者已載明於我們的新聞稿與向 SEC 提交的文件中。

On today's call, we may refer to certain non-GAAP financial metrics, including base results, which exclude the impact of UDlive, acquired May 1, 2026. Our release and earnings presentation provide a reconciliation between the most directly comparable GAAP measure and any non-GAAP financial measures discussed. With that, I'll turn the call over to Ken.

在今天的電話會議中，我們可能會提及若干非 GAAP 財務指標，包括基礎結果（base results），其排除於 2026 年 5 月 1 日收購之 UDlive 的影響。我們的新聞稿與財報簡報提供了與最直接可比的 GAAP 指標及任何所討論之非 GAAP 財務指標之間的調節表。接下來，我把電話交給 Ken。

Thanks, Dan, and good morning. We were pleased with the sales and operating profit performance in the quarter. Excluding the solid revenue contribution of the UDlive acquisition, third quarter base sales increased 5% sequentially from the second quarter. This was largely in line with our expectations and the result of the ongoing ramp of previously disclosed awarded projects and solid underlying market demand in the quarter.

謝謝 Dan，各位早安。我們對本季的銷售與營業利益表現感到滿意。若排除 UDlive 收購案帶來的穩健營收貢獻，第三季基礎銷售額較第二季季增 5%。這大致符合我們的預期，主要來自先前已揭露之得標專案持續放量，以及本季市場基本需求穩健。

As noted in the release, we continue to anticipate both sequential and year-over-year improvement in revenue in the fourth quarter and expect to sustain this growth momentum into 2027, which I'll discuss further in the outlook.

如新聞稿所述，我們仍預期第四季營收將呈現季增與年增的改善，並預計將此成長動能延續至 2027 年；我會在展望部分進一步說明。

The team executed well on the profitability front as we continued operating cost management actions to mitigate the uneven 2026 sales cadence. While also addressing ongoing material cost pressures related to broad electronic supply chain dynamics as we described last quarter.

團隊在獲利面執行良好，我們持續推動營運成本管理措施，以因應 2026 年銷售節奏不均的情況。同時也在處理我們上季所描述、與整體電子供應鏈動態相關的原物料成本壓力。

I'll turn the call over to Dan to walk through the specifics of the quarter and then Bob will provide an update on commercial activity, including our formal launch of OneNetwork. I'll then come back to cover the outlook and take your questions. Go ahead, Dan.

接下來我把電話交給 Dan，請他說明本季的具體表現，之後 Bob 會就商務活動提供最新進展，包括我們正式推出 OneNetwork。之後我會回來說明展望並回答各位提問。Dan，請。

Thanks, Ken. Turning to slide 3, total sales in Q3 were $235.9 million in line with the third quarter of 2025. Excluding the benefit of UDlive sales of $5.6 million, base sales were down 2% year-over-year. Sequentially, base sales were 5% higher than the second quarter levels with a number of the previously disclosed awarded projects ramping, including another quarter of process shipments. Utility water sales were flat year-over-year and excluding the acquisition were down 3%, reflecting the same project pacing dynamics mentioned earlier.

謝謝 Ken。請看投影片第 3 頁，第三季總銷售額為 2.359 億美元，與 2025 年第三季持平。若排除 UDlive 帶來的 560 萬美元銷售貢獻，基礎銷售額年減 2%。就季比而言，隨著多項先前已揭露之得標專案逐步放量（包括製程出貨再增加一季），基礎銷售額較第二季水準高出 5%。公用事業用水（utility water）銷售額年比持平；若排除收購影響則年減 3%，反映前述相同的專案進度節奏因素。

Lower AMI-related product sales were partially offset by higher software revenue. It is important to note that base utility sales improved 5% sequentially.

AMI 相關產品銷售較低，部分被較高的軟體營收所抵銷。需要特別指出的是，基礎公用事業銷售額季增 5%。

Sales of the flow instrumentation product line were up 2% year-over-year against the prior year's most difficult comparison as we experienced broad-based water application demand. We continue to see increasing demand in data center applications for our flow instrumentation products, albeit from a relatively small revenue base.

流量儀表（flow instrumentation）產品線銷售額年增 2%，是在去年最具挑戰性的比較基期之上達成，反映水務應用需求呈現廣泛成長。我們也持續看到資料中心應用對流量儀表產品的需求增加，但目前仍是相對較小的營收基礎。

We were pleased with operating profitability this quarter, largely the result of higher sales. Ongoing structural mix benefit to gross margins and effective price cost management. On a year-over-year basis, operating earnings increased 4% with margins up 60 basis points to 20.2%. Base operating profit margins excluding UDlive were 20.9%, up 130 basis points from last year's third quarter.

我們對本季的營運獲利能力感到滿意，主要來自較高的銷售額。毛利率持續受益於結構性產品組合改善，以及有效的價格與成本管理。以年比來看，營業利益增加 4%，營業利益率上升 60 個基點至 20.2%。排除 UDlive 後的基礎營業利益率為 20.9%，較去年第三季提高 130 個基點。

Gross margin was 41.9% up 120 basis points from the third quarter of 2025, reflecting structural mix improvements primarily from higher ultrasonic meter sales and continued growth of our software as a service revenue, partially offset by the dilutive impact of UDlive's inventory fair value step-up amortization in the quarter.

毛利率為 41.9%，較 2025 年第三季提高 120 個基點，反映結構性組合改善，主要來自超音波水表銷售增加以及我們軟體即服務（SaaS）營收持續成長；但部分被本季 UDlive 存貨公允價值調升（step-up）攤銷所造成的稀釋影響所抵銷。

Base gross margin was 42.1% at the top end of our normalized range, indicative of the resiliency of our overall structural mix and pricing discipline.

基礎毛利率為 42.1%，位於我們常態化區間的上緣，顯示整體結構性組合與定價紀律具備韌性。

Last quarter, I called out the increasing level of electronic component cost and availability pressures to gross margins, which are a byproduct of the AI and data center build-out demand. As demonstrated by our margin performance, we have thus far been able to adequately mitigate these impacts. However, the challenges posed by these pressures have not abated.

上季我曾提到，電子元件成本與供應可得性對毛利率的壓力正在上升，這是 AI 與資料中心建置需求所帶來的副作用。從我們的毛利率表現可見，截至目前我們已能充分緩解這些影響。然而，這些壓力所帶來的挑戰並未減輕。

Turning to selling, engineering, and administrative expenses, the third quarter's $51.1 million was $1.3 million higher year-over-year, including $2.3 million from the addition of UDlive, inclusive of the intangible asset amortization. This was partially offset by lower incentive compensation and the benefit of appropriate cost controls. As a reminder, our preliminary expectation for UDlive intangible asset amortization is approximately $5 million annually. The effective income tax rate in the quarter was 25.1% compared to 26.1% last year.

接著看銷售、工程與管理費用（selling, engineering, and administrative expenses），第三季為 5,110 萬美元，較去年同期增加 130 萬美元，其中包含因新增 UDlive 而增加的 230 萬美元（含無形資產攤銷）。部分增幅被較低的獎酬費用以及適當的成本控管效益所抵銷。提醒各位，我們對 UDlive 無形資產攤銷的初步預期約為每年 500 萬美元。本季有效所得稅率為 25.1%，去年同期為 26.1%。

Finally, diluted earnings per share were $1.24, an increase of 4% from $1.19 in the prior year period. Primary working capital as a percentage of sales was 23.6%, up slightly from 22.9% at the prior quarter end. We anticipate continuing to work down the above-average inventory levels resulting from revenue pacing dynamics and electronic safety stock levels as the year concludes.

最後，稀釋後每股盈餘為 1.24 美元，較去年同期的 1.19 美元增加 4%。主要營運資金（primary working capital）占銷售額比重為 23.6%，較上一季季末的 22.9% 略為上升。我們預期在年底前，將持續降低因營收節奏因素與電子元件安全庫存水位所導致的高於平均的存貨水準。

Free cash flow was $40.3 million, down from $48.2 million in the prior year comparable quarter. As always, we remain focused on delivering free cash flow conversion in excess of 100% of net earnings. In the third quarter of 2026, we repurchased 423,000 shares for a total of approximately $55 million and have roughly $35 million remaining on our current share repurchase authorization.

自由現金流為 4,030 萬美元，低於去年同期可比季度的 4,820 萬美元。一如既往，我們仍專注於實現自由現金流轉換率超過淨利的 100%。在 2026 年第三季，我們回購 423,000 股，總金額約 5,500 萬美元；目前的庫藏股回購授權尚餘約 3,500 萬美元。

With that, I'll turn the call over to Bob.

接下來我把電話交給 Bob。

Thanks, Dan. A few weeks ago, we had the opportunity to connect with customers, engineering consulting firms and investors at WEFTEC in New Orleans. During the show, we formally launched OneNetwork, our real-time network monitoring and analysis platform for water and wastewater utilities. For those that attended our Investor Day back in May of this year, you heard an early preview of OneNetwork.

謝謝 Dan。幾週前，我們有機會在紐奧良的 WEFTEC 與客戶、工程顧問公司以及投資人交流。展會期間，我們正式推出 OneNetwork——我們為自來水與污水公用事業打造的即時網路監測與分析平台。今年 5 月參加我們投資人日的各位，當時已聽到 OneNetwork 的初步預覽。

In short, OneNetwork brings AMI, network monitoring, and water quality data together in one platform, enabling customers to identify issues sooner, coordinate responses faster, and make more informed operational decisions.

簡而言之，OneNetwork 將 AMI、網路監測與水質數據整合於同一平台，使客戶能更早識別問題、更快協調應對，並做出更有依據的營運決策。

Why is this important? Utilities today have an immense amount of data, from online sensors to SCADA and GIS information. OneNetwork provides a unified real-time view of this disconnected data to make it usable. By moving from fragmented data to a single operational view, OneNetwork empowers utilities through alerts, advanced analytics and workflows to better manage issues such as pressure events, water quality changes and non-revenue water spikes.

為什麼這很重要？如今公用事業單位擁有大量數據，來源涵蓋線上感測器、SCADA 與 GIS 資訊。OneNetwork 提供對這些彼此分散數據的統一即時視圖，使其可被有效運用。透過從碎片化數據轉向單一營運視圖，OneNetwork 以警示、進階分析與工作流程賦能公用事業單位，更妥善管理如壓力事件、水質變化與非收益水（non-revenue water）激增等問題。

This saves utilities both time and money while increasing their capability to respond faster and act with purpose.

這能為公用事業單位同時節省時間與成本，並提升其更快速回應、且有目的地採取行動的能力。

WEFTEC visitors were able to view one-network demonstrations, and customer and consultant interest was high. It serves as another example of our competitive differentiation through innovation, portfolio constructions, and the benefits derived by customers from our sole focus on value-driven water technology.

WEFTEC 參觀者得以觀看 one-network 的示範，客戶與顧問的興趣相當高。這也再次展現我們透過創新、產品組合建構，以及專注於價值驅動的水務科技所為客戶帶來的效益，形成競爭差異化。

One important way we gain critical feedback and inform our innovation is through our ENGAGE customer community, which encompasses in-person and virtual discussions throughout the year. This week, we had the signature event ENGAGE Live, hosted in our hometown of Milwaukee, where current and prospective customers interacted with our leadership, product management, and sales and customer support teams.

我們獲得關鍵回饋並為創新提供資訊的一個重要方式，是透過我們的 ENGAGE 客戶社群；該社群涵蓋全年面對面與線上的討論。本週，我們在家鄉密爾瓦基舉辦了招牌活動 ENGAGE Live，現有與潛在客戶與我們的領導團隊、產品管理，以及銷售與客戶支援團隊進行互動。

Among other outcomes, the event has served to share best practices for implementations, outcomes and funding sources, as well as gain insight and share feedback on our future product and software plans. It is clear from talking to customers that utility needs for and interest in our tailorable solutions to meet their increasing challenges remains high, and we are well positioned to capitalize on these opportunities to improve customer outcomes.

除其他成果外，該活動也用於分享導入最佳實務、成果與資金來源，同時蒐集洞見並就我們未來的產品與軟體規劃交換回饋。從與客戶的對談可清楚看出，公用事業對我們可客製化解決方案的需求與興趣仍然很高，以因應其日益增加的挑戰；而我們也具備良好條件把握這些機會，以改善客戶成果。

With that, I'll turn the call back to Ken.

接下來我把電話交回給 Ken。

Thanks, Bob. Looking ahead to the fourth quarter, I'll reiterate here what we said in the release, which is consistent with our discussions over the past few quarters. We continue to anticipate further ramping of awarded utility projects, noting as always, the inherent unevenness typical of the business.

謝謝，Bob。展望第四季，我在此重申我們在新聞稿中所說的內容，這也與我們過去幾季的討論一致。我們仍預期已得標的公用事業專案將進一步放量，同時也一如既往地注意到此業務固有的波動不均。

We expect both year-over-year and sequential quarterly base sales growth in the fourth quarter of 2026. Despite fewer total operating days given the holidays, which is a standard annual dynamic. While I won't delve into 2027 specifics at this point, I will note that our conviction in sustaining this growth momentum into 2027, as well as the long-term growth profile for Badger Meter remains intact as we continue to manage usual quarter-to-quarter dynamics.

我們預期在 2026 年第四季，基礎銷售額將同時呈現年增與季增。儘管因假期導致總營運天數較少，這是每年例行的情況。雖然我此刻不會深入談 2027 年的細節，但我要指出，我們對於將此成長動能延續至 2027 年，以及 Badger Meter 的長期成長輪廓，仍深具信心；同時我們也會持續管理一如往常的季度間波動。

We remain committed to the strategic formula that has driven our prolonged success. Focusing on our customers, offering innovative and differentiated technologies, and driving operational excellence. You heard Bob speak to advancements in software outcomes and customer engagement, which reinforce our multi-year opportunities in both metering and beyond the meter growth.

我們仍致力於推動我們長期成功的策略方程式。聚焦客戶、提供創新且具差異化的技術，並推動卓越營運。你們也聽到 Bob 談到軟體成果與客戶互動的進展，這些都強化了我們在計量（metering）以及「表後」（beyond the meter）成長方面的多年期機會。

Our longstanding capital allocation approach of investing in growth while also returning cash to shareholders also supports this long-term growth strategy.

我們長期以來的資本配置方針——在投資成長的同時也將現金回饋股東——同樣支持這項長期成長策略。

For example, in August, we increased our annual dividend rate by 10%, marking the 34th consecutive year of increases and we repurchased $55 million of our outstanding shares, bringing the trailing four quarters to over $130 million.

例如，在 8 月，我們將年度股利率提高 10%，這是連續第 34 年調升；同時我們回購了 5,500 萬美元的流通在外股份，使得過去四個季度的回購總額超過 1.3 億美元。

In summary, I remain optimistic about our team's ability to deliver value creation opportunities for our customers and shareholders alike. With that, operator, please open the line for questions.

總結來說，我對我們團隊為客戶與股東同時創造價值的能力仍保持樂觀。接下來，接線員，請開放提問。

(Operator Instructions)

(接線員指示)

Nathan Jones, Stifel.

Nathan Jones，Stifel。

I guess, Ken, I'm going to start off with the 4Q guidance. You guys have talked about full year revenue being flat-ish, the 4Q guide being sequentially and year-over-year better. Would be a pretty wide range to get into something that would be flat-ish. So I'm hoping you can put a finer point on what you think 4Q revenue is likely to be. And what's the upper and lower bound for you on flat-ish?

我想，Ken，我先從第四季指引開始。你們談到全年營收大致持平，而第四季指引在季比與年比都更好。要做到「大致持平」會有相當大的區間。所以我希望你能更精確地說明你認為第四季營收可能落在什麼水準。另外，你所說的「大致持平」上下限各是多少？

Yeah, thanks, Nathan. When we put that term out there earlier in the year, you'll recall that at Investor Day when we were asked on flat-ish, I called out don't expect upside, right? So on a year-over-year basis, I was pretty vocal on the best case would be flat year-over-year.

好的，謝謝你，Nathan。我們在今年稍早提出那個用語時，你會記得在投資人日被問到「大致持平」時，我特別強調不要期待上行空間，對吧？所以以年比來看，我相當直白地說過，最佳情境也就是年比持平。

The way things have played out, we're really proud of where we're headed going into Q4, looking at year-over-year growth. We said we'd exit the year with momentum. We're doing that. When we talk about modest growth in the quarter, that keeps in mind the 5% fewer workdays in the quarter, but we expect to be up. So if you needed to peg me on something at this point, I would say that I would expect modest growth in the quarter sequentially and perhaps low single-digits on a year-over-year, full-year basis?

就目前的發展而言，我們對於進入第四季的走勢感到非常自豪，因為我們看到年比成長。我們說過年底會帶著動能收官。我們正在做到。當我們談到本季溫和成長時，也把本季工作天數少了 5% 這點納入考量，但我們預期仍會成長。所以如果你現在要我給一個大致的說法，我會說我預期本季季比溫和成長，而在全年年比的基礎上，可能是低個位數的變動？

I guess my follow-up questions on gross margins, which were much better than I expected them to be in the quarter, given some of the pressures that you were facing from lower gross margins on some of the projects that are ramping up. Obviously, there's inflation that's passing through. So maybe you can just talk a little bit about the dynamics there, what led to those gross margins. Being as strong as they were and how you're thinking about those in the fourth quarter and as we head into next year?

我接著想問毛利率。考量到你們面臨的一些壓力——某些正在放量的專案毛利率較低——本季毛利率比我預期好很多。顯然也有通膨在轉嫁。所以也許你可以談談其中的動態，哪些因素帶動毛利率表現如此強勁，以及你們對第四季與明年展望時如何看待毛利率？

Yeah, sure. So first thing I want to clarify, I'm sure you understood what I meant, but I didn't say the word down, so we expect to be down year-over-year low single-digits, just to be clear.In terms of --

好的，當然。首先我想澄清一下，我相信你理解我的意思，但我剛才沒有說「下降」這個字，所以為了清楚起見，我們預期全年年比會下降低個位數。至於——

Full year, down low single-digits.

全年，下降低個位數。

Full year down low single-digits, 4Q up low single-digits, or is that not what you said?

全年下降低個位數，第四季上升低個位數——還是你不是這個意思？

I'm not providing a digits on the up for Q4.

我不會對第四季的上升提供具體數字。

Okay.

好的。

Modestly up.

溫和上升。

Down low single-digits, full year. Got it.

全年下降低個位數。了解。

Correct. Got it. Perfect. Now, when it comes to margins, yeah, sure thing. When it comes to margins, I'll just reiterate what we've said for several years now. We have this really positive structural mix that regardless of operating conditions, it does tend to get. Incrementally better every year when we have really nice growth in software that's higher margin, beyond the meter is all higher margin. So the structural mix remains greatly intact, which helps us with a really strong floor on margins.

正確。了解。很好。現在談到毛利率，好的，沒問題。關於毛利率，我再重申我們過去幾年一直說的。我們有非常正向的結構性產品組合（mix），不論營運環境如何，它往往會——在每一年都有所改善，因為我們的軟體成長很不錯，而軟體毛利率較高；「表後」業務也都是較高毛利。因此，結構性組合仍然非常穩固，這讓我們的毛利率有很強的底部支撐。

And then also our hallmark, I think, for the last five or six years is when challenged, we've performed in a really operationally excellent way. So, we understood what the challenges are, and I'm really proud of our team, how we handled it. I'll turn it to Dan here for some more specifics, but just generally, I feel really good of how we've navigated the quarter.

另外，我認為過去五、六年我們的一大特色是：在面臨挑戰時，我們仍能以非常卓越的營運方式表現。所以，我們理解挑戰是什麼，我也為團隊感到非常自豪，因為我們處理得很好。我把話交給 Dan 補充更具體的內容，但整體而言，我對我們如何應對本季感到很滿意。

Yeah, and so, Nathan, if I look at the quarter specifically and go back to the remarks that I had in the script, the biggest two drivers within the quarter were what I called out, which was ultrasonic meter mix. Generally across the residential space and then continued software growth.

好的，Nathan，如果我聚焦在本季，回到我在講稿中的說明，本季最大的兩個驅動因素就是我提到的：超音波水表的產品組合。主要是在住宅市場，以及軟體持續成長。

So as we move throughout the year and as the resiliency of our software growth is in the install base. And so despite the unevenness that we've experienced throughout the year, that software growth has continued.

因此，隨著我們在全年推進，軟體成長的韌性來自於既有裝機基礎（install base）。所以即便我們今年經歷了不均衡的波動，軟體成長仍持續。

All the other things that I've called out -- all the other things I've called out in prior quarters are the same drivers, we're paying attention to both on the positive side from the structural mix perspective, but also on the downside risk perspective from turnkey mix and electronic component availability and supply and cost. So it's really all of the same drivers. It's just how does that particular quarter play out.

我在前幾季提到的其他所有因素——我之前提到的其他所有因素仍是相同的驅動因子；我們一方面從結構性組合的正面角度關注它們，但也從整包交付（turnkey）組合、電子元件可得性，以及供應與成本等下行風險角度加以留意。所以驅動因素都一樣。差別只在於那一季的具體情況如何發展。

No one-time is like power-free funds or anything in the quarter.

本季沒有像是 power-free funds 之類的一次性因素吧。

Nothing meaningful.

沒有任何重大的。

Great. Thank you.

很好。謝謝。

Quinn Fredrickson, Baird.

Quinn Fredrickson，Baird。

Hey, good morning, everyone. Recognize you have these larger AMI projects kicking off, but the release mentioned solid underlying demand trends in the third quarter. I know you don't break it out, but even qualitatively, does the underlying day-to-day replacement business feel like it's getting a little healthier or more normal, just any commentary there?

各位早安。我知道你們有這些較大型的 AMI 專案正在啟動，但新聞稿提到第三季基本面需求趨勢穩健。我知道你們不會把它拆開揭露，但即便是定性來看，日常的汰換／更換需求是否感覺變得更健康或更正常一些？想請你們評論一下。

Yes, just if we circle back to how we talked about this in Q1, we were pointing out that on that shorter visibility window, there is inherent unevenness, can be up, can be down, and. Certainly, we were surprised to how far down in Q1. But Q2 and 3 have been perfectly normal. So obviously, to get to the result that we did, Q2 was better than Q1, Q3 was better than Q1. So structurally, demand feels good to us. And while Q1 was down, the year has really been pretty normal other than that one outlier.

是的，如果我們回到第一季時的說法，我們當時指出在那種較短的可視性窗口下，本來就會有內在的不均勻性，可能上、可能下。當然，我們也對第一季下滑幅度之大感到意外。但第二季和第三季都完全正常。所以很明顯，為了達到我們現在的結果，第二季比第一季好、第三季也比第一季好。就結構面而言，我們覺得需求狀況不錯。而且雖然第一季偏弱，但除了那個離群值之外，今年其實一直都相當正常。

Second, just on PRASA, there's been some headlines about drought and water supply pressures in Puerto Rico, has the urgency around the AMI rollout changed at all with that or does that create any more urgency to create a faster deployment schedule, just any commentary on how that impacts the project there?

第二個問題，關於 PRASA，最近有一些關於波多黎各乾旱與供水壓力的新聞標題；這是否讓 AMI 推動的急迫性有任何改變？或是否會帶來更高的急迫性、促使更快的部署時程？想請你們談談這對當地專案的影響。

Yeah, so it wouldn't be appropriate for me to comment on their ability or desire to go faster or not. The challenges you read about are certainly real, and that's why they're looking to adopt our AMI system. What I can tell you is we've begun shipping product this year. We had mentioned that we began in Q2 and Q3 because they're ramping up to get started with installations.

是的，所以我不適合評論他們是否有能力或意願加快進度。你們看到的那些挑戰確實存在，也正因如此他們才會考慮採用我們的 AMI 系統。我能告訴你的是，我們今年已經開始出貨。我們先前提到，我們在第二季和第三季開始出貨，因為他們正在拉升準備開始安裝。

They've hired the installation contractors, they're in planning, and they're expecting to start installations in Q4. Yeah, I think ideally if they could go faster, they'd love to. But the way these projects are, I should probably point out that just because the projects are ramping, they will also be inherently uneven. Some go faster, some go slower from quarter to quarter as you run into manpower challenges or weather issues.

他們已聘用安裝承包商，正在做規劃，並預期在第四季開始安裝。是的，我想理想情況下，如果他們能更快，他們當然會希望更快。但這類專案的特性，我可能也要指出：即使專案正在爬坡推進，進度本身也會天生不均勻。有些季度會快一些，有些季度會慢一些，因為可能遇到人力挑戰或天候因素。

So the projects starting inclusive of PRASA and the others. Feels great for the long-term, but I do always want to remind people, quarter to quarter, there can be variation even though these projects are in flight.

所以，包含 PRASA 在內以及其他專案的啟動，長期來看感覺非常好，但我也一直想提醒大家，即使這些專案正在進行中，按季度來看仍可能出現波動。

Jeffrey Reive, RBC Capital Markets.

Jeffrey Reive，RBC Capital Markets。

Thank you. Good morning. So given the nine projects ramping UDlive annualizing mid-year next year and have easier comps across all four quarters, is it fair to expect a return to high single-digit organics next year or could that ramp dynamic actually push you above that range?

謝謝。早安。所以，考量到九個專案正在爬坡、UDlive 會在明年年中進入年化貢獻，且四個季度的比較基期都更容易，是否可以合理預期明年有機成長回到高個位數？還是說這種爬坡動能其實可能把你們推到高個位數以上？

Yeah, I think the math equation of that sounds correct, right? As we head into Q4, that's an easier year-over-year comp and the first couple of quarters are certainly easier than the back half will be. I'm not going to peg a year because of all the inherent unevenness I just talked about when short cycles can be and how projects can ramp or not, but we feel really good about the year in general in terms of our ability to get back on our strategic growth horizon of high single-digits.

是的，我覺得從數學上來看，你的推導聽起來是對的，對吧？進入第四季後，同比基期會更容易，而前兩個季度肯定也比下半年更容易。但我不會把某一年「釘死」在一個數字上，因為我剛剛提到短週期本來就有很多內在的不均勻性，以及專案可能爬坡、也可能不如預期爬坡。不過就整體而言，我們對明年很有信心，因為我們有能力回到我們策略性成長軌道，也就是高個位數成長。

But to peg the year is probably not great at the moment, but we feel good about it.

只是此刻要把整年精確定錨可能不太好，但我們對此感覺良好。

Fair enough. And then last quarter, you flagged increasing electronic component costs and availability pressures tied to AI and data center demand. Have those pressures escalated further and have you needed to take any incremental pricing or sourcing actions?

了解。另外，上季你們提到因 AI 與資料中心需求帶動，電子元件成本上升、供應可得性也有壓力。這些壓力是否進一步升高？你們是否需要採取任何額外的調價或採購／供應鏈策略行動？

Yeah, so they have escalated. So we do continue to see some price escalation. We do continue to see availability challenges. Again, I want to point out. Our team has been excellent this time and the last time we faced a similar situation.

是的，確實有升高。所以我們仍持續看到一些價格上漲。我們也持續看到供應可得性的挑戰。再次強調，我們的團隊這次以及上一次面對類似情況時都表現非常出色。

We understand the challenge in front of us. Our team is working hard on it. Fortunately for us, our portfolio is highly valued by our customers. They understand what we do for them and we're able to extract the value that we deserve. So the word I'd rather talk about that than pricing, but yes, we can balance price-cost dynamics pretty effectively.

我們理解眼前的挑戰。我們的團隊正在努力處理。對我們而言幸運的是，我們的產品組合在客戶心中價值很高。他們理解我們為他們做了什麼，而我們也能夠取得我們應得的價值。所以我更想用「價值」來談，而不只是「定價」；但答案是肯定的，我們能相當有效地平衡價格與成本的動態。

James Ko, Jefferies.

James Ko，Jefferies。

Good morning.Thanks for taking questions here. Just one quick clarification question.When you say low single-digit decline for the full year, is that organic or inclusive of all you did life here?

早安，謝謝讓我提問。我先快速釐清一點：你們說全年低個位數下滑，這是指有機成長，還是包含你們這裡所做的所有 UDlive 相關影響？

That is organic.

那是有機的。

Awesome. Yeah, thanks for that. I guess, yes, can we talk about like the non-metering businesses like UDlive and SmartCover, how they are doing, whether those are going like above the company average and whether those are kind of trending in line with your deal case?

太好了。謝謝釐清。那我想談談非計量（non-metering）業務，例如 UDlive 和 SmartCover 的表現如何？它們是否高於公司平均？以及它們的走勢是否大致符合你們當初交易案（deal case）的預期？

Yes, so as those are also in our utility bucket that we talked about more broadly. UDlive is still very public. We're really excited about the opportunities as we were when we acquired both of these companies. It's an absolute need that every utility customer deals with.

是的，這些也都屬於我們先前更廣泛談到的公用事業（utility）業務範疇。UDlive 仍然非常公開、透明。我們對機會非常興奮，就像我們收購這兩家公司時一樣。這是每一家公用事業客戶都必須面對的絕對需求。

It's an innovative product. We've got the right sales channels. So feel good about the progress on UDlive, feel equally as good about Smart Cover, and that will continue to be part of this high-digit growth story that we talk about for years to come.

這是一個創新產品。我們也有正確的銷售通路。所以我們對 UDlive 的進展感覺良好，對 SmartCover 也同樣有信心；而且這也會持續成為我們未來多年所談的高個位數成長故事的一部分。

Awesome.

太好了。

Scott Graham, Seaport.

Scott Graham，Seaport。

Hey, good morning. Thanks for taking the question. I have two questions for you. First is, I know you talked about underlying demand in a previous question. I'm just wondering, the other two of the big three, so to speak, are talking about the category having been fairly sluggish all year.

嗨，早安。謝謝讓我提問。我有兩個問題。第一個是，我知道你們在前一題談到基本面需求。我想問的是，所謂三大廠中的另外兩家都在談這個類別今年整體相當疲弱。

And it's hard to say if they're parsing out their software businesses, but certainly the metering units seems to be an issue this year. Could you talk about that a little bit and kind of why that weakness has kind of pervaded all year and perhaps what you're thinking that the category looks like in units, meter units next year?

很難說他們是否把軟體業務拆開來看，但很明顯今年計量表（metering）出貨單位似乎是個問題。你們能否談談這點，以及為什麼這種疲弱會貫穿整年？另外你們對明年這個類別、也就是電表出貨單位的看法是什麼？

Yeah, so that's a great question. So with 50,000 utilities of different sizes and shapes and geographies, it's hard for me to tell you across the board a cookie cutter answer that the market is down X percent. I don't know what the other big two have in terms of projects like we detailed for you. They may have different unevenness in their business that, well, actually I'm certain they have it. I just don't know what their particular mix is. So it wouldn't be appropriate for me to comment on what their issue is.

是的，這是個很好的問題。因為有 50,000 家不同規模、型態與地理分布的公用事業公司，我很難給你一個放諸四海皆準的答案，說整體市場下滑了 X%。我也不知道另外兩大廠有哪些像我們剛才向你們詳述的專案。他們的業務也可能有不同的不均勻性——其實我可以確定他們一定也有。只是我不知道他們各自的組合是什麼。所以我不適合評論他們的問題是什麼。

But what I see and when we talk to customers and as Bob pointed out, we saw customers at WEFTEC, we saw customers this week in Milwaukee and I get all the noise that's out there about the market and all the things that people have talked about in the past around funding, but our customers are looking forward to the future to deal with the issues that they have to deal with.

但就我所看到的，以及我們與客戶的對話——如 Bob 所提到的，我們在 WEFTEC 見了客戶，這週也在密爾瓦基見了客戶——我理解外界對市場有很多雜音，也有過去大家談到的各種議題，例如資金等，但我們的客戶正著眼未來，去處理他們必須面對的問題。

They have to upgrade their infrastructure. They have to be better informed about what decisions to make with their limited resources. And we're just really happy that they're choosing our portfolio. So I shouldn't comment on the other guys?

他們必須升級其基礎設施。他們必須更充分掌握資訊，以便在資源有限的情況下做出正確決策。而我們也非常高興他們選擇了我們的產品組合。所以我不應該評論其他競爭對手嗎？

Thank you. I wanted to just also ask about the gross margin in the backlog. And I know the backlog has been burned down a lot in the last couple of years with supply chain getting better. I'm just wondering, you have a little bit more visibility now on these projects, which are now starting to ship.

謝謝。我也想再問一下在手訂單（backlog）的毛利率。我知道過去幾年隨著供應鏈改善，在手訂單已經消化了不少。我想了解的是，現在這些專案開始出貨，你們對這些專案的能見度也更高了一些。

I was just sort of hoping if you can just tell us that the gross margin backlog, how much of that is linked to CPI? And for the rest of it, how are you handling price increases?

我只是希望你們能告訴我們，在手訂單的毛利率中，有多少是與CPI連動的？至於其餘部分，你們如何因應價格上漲？

So I would just reiterate that even though we've been operating at the higher end, just given all the mixed things that can happen and some of the lack of visibility on short-term, as you pointed out, we feel really good about our ability to operate within the 39% to 42% gross margin range that we talked about. We feel great as we resume growth, being able to get back to that really good leverage of SEA that we've talked about before. So all in, it feels manageable to us to stay within the margin ranges that we've consistently communicated.

我只想重申，儘管我們一直在較高端運作，但考量到可能發生的各種組合因素，以及如你所指出的短期能見度不足，我們對於能在先前提到的39%到42%毛利率區間內運作仍然非常有信心。隨著我們恢復成長，我們也很有信心能回到我們之前談過的SEA的良好槓桿效益。總體而言，對我們來說，在我們一貫對外溝通的毛利率區間內維持表現是可控且可管理的。

Thank you, Ken.

謝謝你，Ken。

William Griffin, Barclays.

William Griffin，巴克萊。

All right. Thanks very much. Appreciate the time and the opportunity here. Apologies to come back to the margin question again, but your commentary last quarter when you called out some of the supply chain cost pressures, it felt to me like maybe you were trying to signal something, right? And then here with third quarter results, clearly margin was quite good at the high end of your long-term target range.

好的。非常感謝。感謝你們撥冗並提供這個交流機會。抱歉又回到毛利率的問題，但你們上季在提到一些供應鏈成本壓力時的評論，讓我覺得你們可能是在釋放某種訊號，對吧？而這次第三季結果顯示，毛利率顯然相當不錯，處於你們長期目標區間的高端。

Are you trying to signal something in terms of how we should expect margin to trend in the fourth quarter or even into next year as some of these larger projects start to ramp and perhaps, I don't know if there's any notable differences in your contract structures we should be aware of there?

你們是否想在第四季，甚至明年，隨著一些較大型專案開始放量時，釋放關於毛利率走勢的訊號？另外，我不確定是否有任何我們需要留意的合約結構上的顯著差異？

Yeah, so when I signal those things, I'm trying to signal the whole of all of the components that go into our gross margin picture. And again, I always remind people structural mix is the biggest driver. And so when we call out in the quarter what's happening with ultrasonic meter mix and what's happening with software mix, maybe that's masking some of what's happening on the electronic side, but we're also managing that dynamic as well.

是的，所以當我提到那些事情時，我是想傳達所有構成我們毛利率全貌的各項要素。而且我也一直提醒大家，結構性產品組合（structural mix）是最大的驅動因素。因此，當我們在季度中點出超音波水表的組合變化、以及軟體組合的變化時，這可能掩蓋了電子產品端正在發生的一些情況，但我們也同樣在管理那樣的動態。

And so me calling that out as a particular risk isn't trying to, in the next quarter, tell you what's going to happen. It's just trying to show you that there's multiple levers that contribute to what our margin performance is in any given quarter or year. And at the time where we are right now, we started to talk about that pressure here in the second quarter and as of the end of the third quarter, I would say the challenges still exist.

所以我把那點提出來作為特定風險，並不是想告訴你們下一季會發生什麼。而是想讓你們看到，有多個槓桿會影響我們在任何一個季度或年度的毛利率表現。以我們目前所處的時間點來看，我們在第二季開始談到這個壓力，而截至第三季末，我會說這些挑戰仍然存在。

We've been able to manage it. We feel over the long-term, we'll be able to continue to manage it. But quarter to quarter, there can be leading and lagging impacts of that.

我們一直能夠加以管理。我們也相信從長期來看，我們將能持續管理。但就季度對季度而言，這其中可能會有領先或落後的影響。

Appreciate that color. And then maybe a bit of a long shot here. Are you able to share how much [profit] contributed in the third quarter to top-line?

感謝這些補充說明。接著可能是一個比較勉強的問題。你們是否能分享第三季有多少[利潤]對營收（top-line）有所貢獻？

No, we're not going to get into that. I think the other thing, William, that's important to notice too is. Throughout the year, we have won other projects too, like the year has gone on and been normal. So I know there's a lot of focus on process and rightfully so because it's very large.

不，我們不會深入到那個層面。William，我覺得另外一個也很重要、需要注意的是：在整個年度中，我們也贏得了其他專案，整體年度進展是正常的。所以我知道大家很關注那個流程（process），而且這樣的關注是合理的，因為它規模非常大。

But, the year has played out really well and really, I guess, normalized for us. So we're not going to get into quarter by quarter any project on what it is, but we're happy that, iWe've seen these projects beginning to start. And what that does is quarter to quarter can be uneven, but how we look at the business over the five-year horizon, we feel fantastic that these are all now moving to in-flight status.

但是，今年的表現對我們來說進展得非常好，而且我想可以說是回到常態化。因此，我們不會逐季拆解任何單一專案的情況，但我們很高興看到這些專案開始啟動。這會使得季度之間可能不均勻，但以五年期的視角來看整體業務，我們對於這些專案如今都進入執行中（in-flight）的狀態感到非常振奮。

All right. That's all for me. Thanks for the time.

好的。我這邊就到這裡。謝謝你們撥冗。

Michael Fairbanks, JPMorgan.

Michael Fairbanks，摩根大通。

Hey, good morning. On one of those last points you made, Ken, beyond the cohort of projects that you've talked about extensively, how would you say the pipeline and awards or even backlog beyond that are trending compared to this time last year?

嗨，早安。針對你剛才提到的其中一點，Ken，除了你們已經詳細談過的那一批專案之外，你會如何描述相較於去年此時，其他部分的商機管線（pipeline）與得標（awards），甚至在手訂單（backlog）的趨勢？

Yeah, so throughout the past several years, when we look at the universe of utilities that are currently working with consultants to scope out doing metering projects, which are revenue later in our five-year horizon, or the people that are currently in RFP that are going through the selection processes up to and including in-flight projects, that whole piece feels as robust as it has over the past several years.

是的，所以在過去幾年中，當我們觀察目前正在與顧問合作、規劃計量（metering）專案範疇的公用事業客戶群（這些會在我們五年期展望的較後段帶來營收），或是目前正在進行RFP、走選商流程的客戶，一直到已在執行中的專案，整體而言，這一塊的強勁程度與過去幾年一樣穩健。

Okay, great. And then we saw share buybacks accelerate this quarter. How are we thinking about capital allocation from here?

好的，很好。另外，我們看到本季股票回購加速。接下來我們應該如何看待資本配置？

Yes, our capital allocation priorities remain the same. So we're going to continue to invest in the business and extend our lead in R&D and innovation. We're going to continue to return cash to shareholders in 34 years of increased dividends. We're certainly in position to continue on that trend.

是的，我們的資本配置優先順序維持不變。因此，我們會持續投資於業務，並在研發與創新方面擴大我們的領先優勢。我們也會持續回饋現金給股東，並已連續34年提高股利。我們當然有條件延續這個趨勢。

And in terms of share buybacks, we still have $35 million on the authorization. Even before this period when we weren't buying shares, we've always had an authorization open. So I would imagine as long as we feel great about our superior position of being a cash generator. We'll be able to do that.

至於股票回購，我們的核准額度（authorization）仍有3,500萬美元。即使在這段期間之前、我們沒有買回股票的時候，我們也一直保有回購核准額度。所以我認為，只要我們對自身作為優質現金創造者的優越地位感到非常有信心，我們就能夠進行這件事。

And this year, we also did a really exciting acquisition. So regardless of this being a pretty challenging year for us, we've been able to navigate through this, execute on all three of our important capital allocation priorities, and we'll continue to do that going forward.

而且今年我們也完成了一項非常令人振奮的併購。所以即便今年對我們而言是相當具挑戰的一年，我們仍然能夠一路應對、並在三項重要的資本配置優先事項上都確實執行到位，未來也會持續如此。

Thank you.

謝謝。

You're welcome.

不客氣。

We have now reached the end of the Q&A session. I will now turn the call back to Dan Weltzien for closing remarks.

我們現在已到問答環節結束。我現在把電話交回給Dan Weltzien作結語。

Thank you, operator. Just a quick note for your planning purposes that our year-end 2026 earnings release is tentatively scheduled for January 28, 2027. Feel free to reach out to me if you have any follow-ups at investors@badgermeter.com.

謝謝，接線員。提供一個簡短提醒供各位規劃之用：我們2026年年終財報的盈餘發布，暫定於2027年1月28日。如有任何後續問題，歡迎透過investors@badgermeter.com與我聯繫。

Have a great day.

祝各位有美好的一天。

This concludes today's call. Thank you for attending. You may now disconnect.

今天的電話會議到此結束。感謝各位參與。您現在可以掛線。