Clearfield Inc (CLFD) 2022 Q4 法說會逐字稿

Good afternoon and welcome to Clearfield's Fiscal Fourth Quarter and Full-Year 2022 Earnings Conference Call. My name is Nick and I'll be your operator through this afternoon.

I'll now pass the call over to Mr. Matt Glover from Gateway Group. Please go ahead, sir.

Thank you, operator and good afternoon. Joining us for today's presentation are Clearfield's President and CEO, Cheri Beranek and CFO, Dan Herzog. Following their commentary, we'll open the call for questions. I would now like to remind everyone that this call will be recorded and made available for replay via a link in the Investor Relations section of the company's website. This call is also being webcasted and accompanied by a PowerPoint presentation called the Field Report, which is available in the Investor Relations section of the company's website.

Please note that during this call, management will be making forward-looking statements regarding future events and the future financial performance of the company. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. It's important to note also that the company undertakes no obligation to update such statements except as required by law. Company cautions you to consider risk factors that could cause actual results to differ materially from those in the forward-looking statements contained in today's Press Release Field Report and in this conference call.

The risk factors section in Clearfield's most recent Form 10-Q filing with the Securities and Exchange Commission and its subsequent filings on Form 10-Q provides descriptions of those risks. As a reminder, the slides in this presentation are controlled by you, the listener, please advance forward through the presentation as the speakers present the remarks.

With that, I would like to turn the call over to Clearfield's President and CEO, Cheri Beranek, Cheri?

Thanks. Good afternoon, everyone and thank you for joining us today. It is a pleasure to speak with you this afternoon to share Clearfield's results for the fiscal fourth quarter and full-year 2022 and to provide an update on current business conditions and market trends. Clearfield delivered another phenomenal quarter of financial results in the fourth quarter, continuing our trend of record setting financial performance.

Total net sales for the fourth quarter were $95 million, which includes a $7 million contribution from Nestor Cables acquired on July 26, 2022. We also set a new record for annual results in full fiscal year 2022, with total net sales of $271 million. We are very proud of these results, it reflects the strong execution and tenacity of our team through a challenging macroeconomic environment and industry labor shortage. The significant double-digit growth inorganic Clearfield's quarterly results was driven by a 91% year-over-year increase in Community Broadband revenue.

Clearfield is a major player in delivering high-speed broadband to underserved and unserved communities across the United States. After successfully completing our Now of Age strategic plan in fiscal year 2022, we recently launched its successor, our new LEAP plan to step-up our ability to expand capacity and to rapidly scale our business.

The rising demand for our scalable, craft friendly, high-speed broadband solution is evidence when looking at the backlog for organic Clearfield, which increased 142% at fiscal year end to $150 million. Currently, approximately 2/3 of our backlog is expected to ship within the first two quarters of the fiscal year.

With our focus on continuing strong execution, broadband industry tailwinds that include robust federal subsidies and our current visibility into our backlog and the pipeline behind it, we are guiding to estimated revenue of $380 million to $393 million, representing 40% to 45% growth over fiscal year 2022. For those of you who may be new to Clearfield and our industry, I'd like to provide a brief introduction of who we are and what we do.

Clearfield is a leader in expanding fiber broadband industry. We provide fiber protection, fiber management and fiber delivery solutions that enable the rapid and cost-effective fiber-fed deployment throughout the broadband service provider space. Our primary end-market is Community Broadband, which is predominantly comprised of Tier 2 and Tier 3 incumbent local exchange carriers and an increasing number of municipalities, utilities, co-ops and wireless carriers.

We also serve service providers in the Tier 1 national carrier market and multiple system, cable TV operators or MSOs, as well as some international service providers in Canada, the Caribbean, Central and South America. Our goal and underlying value proposition is to enable the lifestyle that better broadband provides.

The image on the right of slide four is our patented Clearview Cassette, the foundation of our scalable and modular fiber management platform that is used to pass homes and businesses. Also still here is FieldShield, the core to how we bring fiber into our neighborhoods in order to physically connect homes and businesses. Our entire product-line including a Clearview Cassette and FieldShield technology was thoughtfully designed to be friendly in the field reducing both the amount of necessary skilled labor needed for installation and the level of skill required to install.

This enables our customers to complete their deployments faster and more efficiently, accelerating their time to revenue. Given that skilled fiber technician shortages continue to persist, our connectivity products are particularly advantageous as carriers look for ways to overcome deployment challenges. We are moving forward and on schedule to vertically integrate the supply of our fiber optic cables to meet future customer demand for FieldShield.

Given the current supply-chain challenges, our ability to ensure our supply of fiber-optic cable is critically important, so that our deliveries are maintained and our customers can proceed with their planned deployment schedules. Another potential benefit of the Nestor acquisition is evaluating the opportunity to introduce our cassette based fiber management solutions and FieldShield technologies into the European market, who's fiber deployment legs behind the US. We are exploring options in Finland to increase capacity as we strongly believe Nestor will extend our market leadership and strengthen our position to service the growth in fiber deployment for every community.

With that, I'll now turn the presentation over to Dan, who will walk us through our financial performance for the fiscal fourth quarter and full-year 2022.

Thank you, Cheri and good afternoon everyone. It's a pleasure to be speaking with you today about our fiscal fourth quarter and full-year 2022 results. So looking at our fiscal fourth quarter and full-year 2022 results in more detail, consolidated net sales in the fourth quarter of fiscal 2022 were a record $95 million, a 110% increase from $45 million in the same year-ago period and up 33% from $71 million in our third quarter of 2022. This figure includes $88 million from organic Clearfield and a $7 million contribution from the two month period that we own Nestor cables, which we acquired on July 26th.

The increase in net sales was due to higher demand across our core end-markets particularly in our Community Broadband, multiple system operator and national carrier markets consistent with our past quarters of fiscal 2022. Strong momentum in sales bookings continued into the fourth quarter of fiscal 2022, resulting in a 148% year-over-year increase in our sales order backlog.

Order backlog grew to a record $165 million on September 30, 2022 up from $157 million on June 30, 2022 and up from $66 million on September 30, 2021. As we have previously discussed, we expect the expanded capacity at our Mexico and US-based facilities will enable us to capitalize on the significant revenue opportunities we expect for the quarters ahead.

I'll now review net sales by our key market. Sales through our primary market, Community Broadband comprised 61% of our net sales in the fourth quarter of fiscal 2022, consistent with prior quarters in fiscal 2022. In Q4, we generated net sales of approximately $58 million in Community Broadband, up 91% from the same period last year. In addition, for the trailing 12 months ended on September 30, 2022, our Community Broadband market net sales totaled approximately $181 million, which was up 84% from the comparable period last year.

Our MSO business comprised 22% of our net sales in the fourth quarter of fiscal 2022. Momentum in the MSO market continues to be strong with net sales, growing 204% year-over-year and were up 164% for the trailing 12 month period. Net sales in our national carrier market for the fourth quarter of fiscal 2022 increased 69% year-over-year. On a trailing 12 month basis, net sales in our national carrier market were up 96% from the comparable year-ago period.

The national carrier market seems to be staging their material to have product on-hand before deployment in the spring, resulting in more product in the field than we have traditionally seen. Net sales in our international market increased 166% year-over-year in the fourth quarter compared to the same period last year and up 61% year-over-year on a trailing 12 month basis due to the acquisition of Nestor Cables.

Consolidated net sales for fiscal 2022 increased 92% to a record $271 million from $141 million in fiscal 2021. Revenue for standalone Clearfield was $264 million, up 87% year-over-year. The increase in net sales was due to higher demand across our core end-markets, most notably our Community Broadband, MSO, cable TV, national carrier and international markets.

Gross profit in the fourth quarter of fiscal 2022 increased 90% to $37.5 million or 39.5% of net sales from approximately $20 million or 43.6% of net sales in the same year ago quarter. As expected, overhead costs associated with our new facilities in Minnesota and Mexico negatively impacted gross margins. Alongside real-estate costs, increased shipping cost and inflationary increases in some components negatively affected margins.

Nestor Cables experienced one-time acquisition costs, reducing gross profit by approximately 400,000 in the -- $400,000 in the fiscal fourth quarter. Gross profit for fiscal 2022 increased 85% to $113 million or 41.7% of net sales from $61 million or 43.5% of net sales in fiscal 2021. Operating expenses for the fourth quarter fiscal 2022 were $15 million, which were up from approximately $10 million in the same year-ago quarter. The increase in operating expenses consisted primarily of higher compensation cost due to increased personnel and higher performance based compensation, increased travel expenses as well as professional fees, mainly associated with the acquisition of Nestor Cables which were approximately $900,000.

Our higher personnel costs are consistent with the company's strategic investment in sales, product management and engineering personnel to establish a firm organizational infrastructure to support the growing business. As a percentage of net sales, operating expenses for the fourth quarter of fiscal 2022 was 16.1%, down 6.8% from 22.9% in the same year-ago period. Our current OpEx at less than 17% of sales continues to reflect strong operating leverage.

Operating expenses for fiscal 2022 were $49 million, which were up from $36 million in fiscal 2021. As a percentage of net sales, operating expenses for fiscal 2022 was 18.1%, down from 25.5% in fiscal 2021. The increase in operating expenses consisted primarily of higher compensation costs due to increased personnel and higher performance based compensation, increased travel expenses, as well as acquisition related professional fees of approximately $1.6 million.

Net income in the fourth quarter of fiscal 2022 increased 129% to $17 million from approximately $7 million in the same year-ago period and up from approximately $13 million in the third quarter of fiscal 2022. Net income increased as a result of higher revenues.

As a percentage of net sales, net income for the fourth quarter of fiscal 2022 was 17.9%, up from 16.4% in the same year-ago period and up from 17.9% in the third quarter of fiscal 2022. In terms of our balance sheet, we had $2.4 million in capital expenditures in the quarter to support increased capacity and new facility build outs and our inventory balance increased from $69 million to $82 million in the fourth quarter due to the acquisition of Nestor. The company did utilize approximately $16.7 million of its line of credit in July 2022 to fund the Nestor acquisition. Since that time, Clearfield has not drawn on the line of credit.

Net income for fiscal 2022 increased 143% to a record $49 million from $20 million in fiscal 2021. As a percentage of net sales, net income for fiscal 2022 was 18.2% up from 14.4% in fiscal 2021.

That concludes my prepared remarks for our fourth quarter of fiscal 2022. I will now turn the call back over to Cheri. Cheri?

Thanks, Dan. As I mentioned in our opening remarks, we recently launched our new multi-year strategic plan, LEAP after successfully executing on our previous Now of Age plan. To us LEAP means jumping higher, further and with greater force. The LEAP plan is our road map to how we will scale as a company in order to seize the opportunity Clearfield was built to achieve. There are four tenants in our LEAP plan, one for each letter. The L is to leverage our decade long excellence in Community Broadband. We are a leader in Community Broadband fiber connectivity and have been focused on serving this market since we were founded. We make decisions by listening to our clients and understanding their evolving needs, building on our decade-plus of proven success in this market.

We've demonstrated that we can nimbly adapt to a changing marketplace and grow with our customers as they grow. One building block of this tenant is our innovative FastPass approach. FastPass uses in (inaudible) placing to significantly reduce fiber distribution hub cabinet cost and speed up installation times. This enables broadband providers to pass twice as many homes as the competition, while also reducing the time to turn up new dwellings by 50%. We were able to leverage our deep expertise in Community Broadband to develop a solution that is particularly well suited for this market, where faster fiber deployments are a clear competitive advantage.

The E is to execute capacity enhancements. This tenant is the successor to the Now of Age pillar augmenting capacity for ongoing growth. For Clearfield, maintain its leadership position, continue to gain market share from competitors and grow the business overall. Our capacity must continue to expand to address the significant market demand for fiber broadband. There are several recent examples of how we have or plan to enhance our capacity.

The acquisition of Nestor Cables brings us in-house cable manufacturing alongside our termination program, optimizing our sign to market. Tripling our Mexican facility footprint and expanding capacity at our Minnesota facility, developing our supply chain partners, allowing us to add additional flexibility and to increase production as well and then virtual programming, such as our cabling centers, which allows us to scale without added overhead.

Furthermore, as I mentioned earlier, we will also look to expand Nestor's capacity to support their growth in Finland and other European market. The A in LEAP is our plan to accelerate infrastructure investment. This tenant reflects our commitment to continue investing in our organizational infrastructure to support the growing business and effectively manage our expanded capacity. This includes adding personnel in sales, product management and engineering, who can navigate Clearfield to achieve scalable growth. This may also include adding headcount at our facilities in the U.S., Mexico and Finland to ensure we can maintain our product deliveries to customers.

The shortage of trained labor in the market continues to be a challenge for our industry. Look for announcements as we expand Clearfield College, adding virtual online instructor-led as well as infield training programs. Finally, the P in LEAP stands for position innovation at the forefront of our value proposition. Accelerating our customers' time to revenue by designing craft-friendly products that require less skilled labor is the foundation of our value proposition.

We intend to achieve this tenant by emphasizing innovation in our product design and increasing the cadence of our product expansions, with the goal of facilitating our customers' fiber broadband deployments. A great example of an innovative new product is our fiber-first [pedicel], which we announced in August 2022. The fiber-first pedicel is the first of its kind in the industry built for the optimal deployment of fiber, particularly in rural market. The pedicel is deployable in any outdoor environment, is cost-effective and exceeds industry standards for strength, reliability and environmental concerns.

We expect to launch more fiber connectivity and fiber management solutions that offer our customers faster, more streamlined installations that are aligned with federal and state funding program requirements. To summarize, our fourth quarter and full-year financial results demonstrate outstanding execution of our proven growth strategy. Demand for fiber-fed broadband remains very strong. In addition to our organic customer demand for high-speed broadband, operators will begin to see additional disbursements of federal funds to support the development of broadband infrastructure.

We continue to remain very optimistic about Clearfield's growth potential. With our new LEAP plan, we will leverage our deep expertise in Community Broadband, continue to enhance our capacity and prioritize innovative product design to meet this robust customer demand and to capitalize on strong industry tailwind. Our backlog currently stands at an unprecedented $165 million, including $4 million from Nestor cables, with roughly 2/3 of that total scheduled for customer deployments in the next two quarters.

We anticipate revenues to follow year-over-year seasonal patterns, resulting in expected strong year-over-year growth in the first half of fiscal year 2023. We will continue to build capacity and expect to reduce order backlog and as a result, the lead time associated with our product line. While our pipeline and outlook remain strong, there continues to be uncertainty regarding the availability of labor necessary for our customers to build their networks that we expect will be most prevalent in the second half of fiscal year 2023.

We are guiding to estimated revenues of $380 million to $393 million, representing 40% to 45% growth over fiscal year 2022. Clearfield is a leader in Community Broadband fiber connectivity and we were built for this generational opportunity that lies ahead of us.

And with that, we are ready to open the call to your questions.

Thank you. (Operator Instructions) First question comes from Jaeson Schmidt, Lake Street. Please go ahead, sir.

Hey, guys. Thanks for taking my questions and congrats on some really impressive results and a fantastic outlook. Want to start, Cheri, with kind of your most recent comments there towards the end about some uncertainty in the second half of your fiscal year. Is this what your customers are already telling you or are already seeing? Or are these considers more due to just the general macro uncertainty out there?

Yeah, this is more general macro environment in that, there's the continuing commentary from everyone about how are we going to put this all together, but not any specific individual organization.

Okay. That's helpful. And then the migration of the Nestor products to Mexico, you mentioned early calendar -- next calendar year. When should we expect to see any potential gross margin benefit from some of these cost savings?

Probably 12 months, yeah, it's not a short-term expectation there. We'll start manufacturing as I said in the first quarter, but that's predominantly to enhance capacity. We will not be reducing the amount of product that we're manufacturing in Finland. We're actually going to be increasing that and using the Mexican plant for augmentation at this point in time. And then over the course of the next 12 months, we'll be looking at when the crossover point comes where it's more effective than to be building more in Mexico than Finland.

Okay. Got it. And then just the last one for me and I'll jump back into queue. If I recall correctly in the past, I think you mentioned you had about 5% or so of your revenue was a result of the government program such as RDOF. I mean when you look into fiscal '23, what do you think this percentage could potentially be?

I actually don't see '23 growing hugely. Certainly, the ARPU funds and the RDOF funds are beginning to enter our world and that will be -- and we'll see more of that in '23. But the big stuff, the stuff associated with the Infrastructure Act, that unfortunately is a long involved process. The -- now in November, the whole orientation around the infrastructure app is that it's going to be distributed through the states and distributed through the states based upon mapped, unserved and underserved communities. So those maps are being released now in November, but released under the guidance that they will have six months by which to review and challenge them, meaning that we won't see distribution of funding probably until next summer, which means we probably won't see bills until late next year and into '24.

So unfortunately, I don't think Infrastructure Act is going to be a big part of the build for next year, but I do believe that what we're seeing today in regard to organic investment, private equity investment, municipal investment, private public partnerships, all of those are underway and making very good progress.

Okay. Appreciate the color. Thanks a lot, guys.

You're very welcome.

Thank you. Next question will be from Ryan Koontz, Needham and Company. Please go ahead.

Hey, good morning, good afternoon and congrats on a phenomenal quarter. Within the Community Broadband segment there, would you -- are you still acquiring a number of new customers in that segment? Or is it more same-store sales? Is it more customers are spending more on their fiber builds?

I would suppose, we're definitely seeing our existing customer group starting to get -- some of them are still struggling a little bit to get into the group and to establish a cadence, but many are beginning to expand the number of solutions that they're able to meet the doors, they're able to penetrate. And then we're seeing a number of new companies, both new start-ups that are kind of new to our industry in general, as well as new spaces that are new to Clearfield, that have been in the market in the past, but are now using our products for the first time.

It's great color. Thanks. And on the cable front, really nice pickup this quarter there obviously. Would you -- how would you characterize that the split between drivers behind fiber-to-the-home versus more of the active cabinet DAA type deployments?

Right. It's with the community -- the biggest portion of that is still Tier 2 cable TVs going to fiber-to-the-home and that is the smaller regional cable providers who are committed to fiber-to-the-home. But there's a growing amount of revenue coming from more of the larger cable operators looking to reduce the size of their serving area by fiber, penetrating their fiber deeper and actively using -- increasingly using our active cabinets.

Got it. Helpful. And then maybe a question for Dan here on the gross margin compare. Can you help us understand on an organic basis, how Clearfield Organic compared sequentially there on Clearfield margins?

Yeah, so Clearfield organic would be just under -- just under for the quarter, just under 42%.

Okay.

So maintain pretty good.

Steady?

Yeah.

Great. That's awesome. And as we think about next year share relative to the nice guide you laid out there, how should we think about your OpEx plans? And it sounds like some you have some pretty aggressive hiring plans in different areas. Should we think about the model remaining pretty consistent with what you've communicated before in terms of OpEx approaching 20% -- around the 15% range, sorry?

Right, yes clearly, that's absolutely right, exactly where we're targeting.

Great, that's it. Super thanks, I'll get back in the queue.

All right. Super thanks.

Thank you. (Operator Instructions) Our next question is from Greg Mesniaeff, WestPark Capital. Please go ahead.

Thank you for taking my question and congrats on a great quarter and a guide. Question on your customer profile. Are you seeing any growing interest from larger carriers for your products? And part two of that question would be or any of your larger mainstream competitors starting to sniff around in the smaller tier market that you are dominating in?

Right, if you -- see if you look at some of the material that I guess I call your attention to, I think it's Slide 4 or 9 I think, show some of the increase in regard to our national carrier business and how it relates to our overall growth. National Carrier, the big guys increased 100% from $12 million to $25 million for the period and represents about 6% of our business. I think what are the things that was crucial to our product line and our positioning in the marketplace is that while our initial solutions were used by small carriers, it was because that was our target at the time that we started the company, with the product lines are meant to scale to the largest of networks and are effectively used in many of them.

In regard to Community Broadband, our larger competitors have always been part of the Community Broadband initiative. However, they were using products and continue to use products that are more designed for larger or more density cities and communities rather than for the diversity of networks and the lack of density in more rural markets. And so as a result, their products continue to have that competitive advantage.

Thank you for that color and just a quick numbers question. Did you disclose -- what are the DSOs in the quarter, the day sales outstanding?

We didn't disclose, those will come out in our K, but they increased this year or I'm sorry, this quarter here to around -- I think it's around 50.

Great, thank you.

Just those -- yeah, you're welcome.

Okay.

Thank you. Next question will be from Tim Savageaux of Northland Capital Markets. Please go ahead.

Hey and congratulations as well on the great results and I'll follow-up right there on the receivables front and just wanted to see to what extent the acquisition contributed to that increase and maybe ask a question about kind of overall shipment linearity throughout the quarter? And then I have a couple of follow-ups.

Yeah, Nestor did not contribute that much to the DSO a little bit, but Clearfield continues to do business with larger and larger customers. And while they may be under 10%, they may only slightly under 10% and some of those customers and the larger they are, sometimes little bit longer payment terms and that's pretty standard in the industry.

And then as far as shipping linearity, we were pretty consistent. If you just take the quarter, take out the $7 million of Nestor, you take out the quarter, I think we average about 29% is it and that's -- we were right within that range of 29% to 30% each month -- each month of the quarter.

Great. And kind of got to another question in mind there about customers, which has historically been pretty well distributed for you guys. Is that commentary for the quarter, I know you're finishing up the year here. I'm assuming though 10% customers for the year, but I guess I'll ask the question or the quarter or you have one for the year -- one for the year.

[Great].

Okay. And moving on to cable and it's pretty impressive kind of step function here really the last couple of quarters. I wonder if you can give us any color on kind of how you expect that to proceed going forward, right? You've been moving up pretty significantly here, is this kind of a new run rate? Or do you expect that cable number to bounce around a little bit with -- given the bigger operators you're working with?

Well, parts of that business are consistent on a month-to-month with a long-term scheduled manufacturing program and so that will be consistent. And then on top of that, the regional carriers tend to be more project-based, with a little more volatility in regard to their world. And they'll -- and because they're regional and many are located in more northern climates, see and with the excessive cold that we've had now sort early this quarter, I think we'll see the rate of cable TV go down just a little bit more consistent with our overall growth projections rather than the explosion that we've seen the last six to nine months.

Right. That's very, very helpful. And I guess last question for me is sort of coming back on the competitive side. I think we did see something out of Corning and Nokia trying to target the rural broadband market with via distributors. I imagine you've had a chance to see that and I'd be interested if you have any more specific comments about expectations for increased competition from those larger guys as we head forward here? Thanks.

Well, certainly, the amount of revenue that is coming to Community Broadband from the infrastructure actively is certainly one that is attractive to all of us. And our competitors across the board are looking at that and seeing how they can get a piece of the pie, a bigger piece of the pie than what they've got over the course of the last calendar year. And all of our competitors are very formidable and very sizable organization.

I think Clearfield continues to have an advantage not only because of the product lines which we promote here in the time savings and labor savings that we promoted within -- in the Field Report. But one of the things that is really core to who we are is the fact that we built a national sales team for Community Broadband, which is very distributed across the country and is very technical with a very hands-on approach matched with a team of smart guys via so we call them our smart guys that have come either with their previous employee -- customers who become employees or many are military personnel who have deployed fiber in the harshest environments.

And I think that sales organization, which deals directly with our customer base on a technical perspective is one of our biggest competitive advantages. Now we also support our distributors as well and about 50% of our business does go through distribution based upon customers request for a financial or a fiduciary relationship. But being able to have that technical relationship and that training relationship on a direct basis and think will be what strengthens our relationship or our revenue opportunities over the long term.

But we certainly respect what our competitors are doing and expect that there's going to be a big enough market there for all of us to get an increasing amount of revenue moving forward.

Great. Thanks and congratulations again.

Fair enough. Thank you.

Thank you. (Operator Instructions) Next, we have a follow-up question from Ryan Koontz, Needham and Company. Please go ahead.

Hi, thanks for the quick follow-up. I want to ask about backlog and composition of backlog, I see that coming down as a percentage of total revenue as your revenue grows at. Does that mean your lead times are coming down? And what does that mean for your customers as your lead times come down? Does that give you more opportunity for share gain?

Yeah, we are -- even though that our backlog went up as a dollar value, we are aggressively working to increase capacity. And whether that is in Minnesota, whether that's in Mexico, whether that's in Finland, capacity increase is core because we see this market just continuing to grow and grow for the next really five to 10 years. And so -- and in fact I will talk to people and say we are limited only by our ability to scale as fast as our quality systems will scale and that's the gating factor for our revenue and our quality systems have done a fabulous job as we have hit to this point. And so we'll kind of hit that kind of rhythm now. And I think we're going to see moving forward to normalization.

And so as a result that will mean that our backlogs will come down, the dollar value is going to come down as we increase that capacity, eat into the backlog, reduce lead time and provide the opportunity for the organization, for our customers to depend upon us more and more as they have in the past.

So absolutely, we think that will be a competitive advantage for us and we'll work to be able to not only have limited lead times, but more or equally importantly is to be able to ship to our promise dates because we need our service provider customers to be able to really maximize their labor teams and that ability to shift to those commitment dates is really core to ongoing savings and I think growth for Clearfield.

Sure. That's really great to hear. And on the mix of backlog, any changes there? Or is it pretty -- is it pretty representative of the current mix of revenue in general? Or how would you kind of characterize the mix in the backlog total?

I mean the backlog is a little more oriented toward the larger carriers right now and that we do have -- we changed over the course of the last quarter -- 90 days ago, 75% of our revenue was with shipping in the next six months, now we're at about 65%, which means we got more orders associated with those longer scheduled events. And so it's a little bit of a skew towards the larger carriers in cable TV and the national carrier community, but not so significant that it really kind of warps the outlook.

Perfect. Super. Thanks for the help.

Thank you. At this time, this concludes the company's question-and-answer session. If your question has not been taken, you may contact Clearfield Investor Relations team at clfd@gatewayir.com. I'd like to turn the call back over to Ms. Beranek for closing remarks.

Right. Thank you, everyone. It's -- I've had a wonderful day being able to speak with many of you over the course of the last week, also been able to speak with my employees about some exciting things that we're doing and being able to provide their bonus checks and just time to celebrate and that's one of the things that I would encourage you all to do is to celebrate with your families, service -- share the gratitude you have of being a part of this wonderful broadband community and just a time to share with your family. So happy Thanksgiving. I'm grateful for your support in Clearfield and grateful for everything that our employees do for our customers.

Thank you for joining us today for Clearfield's fiscal fourth quarter and full-year 2022 conference call. You may now disconnect.