CSP Inc (CSPI) 2024 Q3 法說會逐字稿

Good morning, everyone, and welcome to the CSPi's third-quarter fiscal year 2024 conference call. (Operator Instructions)

大家早安，歡迎參加 CSPi 2024 財政年度第三季電話會議。（操作員說明）

It is now my pleasure to turn the floor over to your host, Michael Polyviou. Sir, the floor is yours.

現在我很高興將發言權交給主持人 Michael Polyviou。先生，地板是你的了。

Thank you, Matt. Hello, everyone, and thank you for joining us to review CSPi's fiscal 2024 third-quarter results, which ended June 30, 2024. With me on the call today is Victor Dellovo, CSPi's Chief Executive Officer; and Gary Levine, CSPi's Chief Financial Officer. After Victor and Gary conclude their opening remarks, we'll then open the call for questions. (Event Instructions)

謝謝你，馬特。大家好，感謝您與我們一起回顧 CSPi 截至 2024 年 6 月 30 日的 2024 財年第三季業績。今天與我一起參加電話會議的是 CSPi 執行長 Victor Dellovo；和 CSPi 財務長加里‧萊文 (Gary Levine)。維克多和加里結束開場白後，我們將開始提問。（活動須知）

Statements made by CSPi's management on today's call regarding the company's business that are not historical facts may be forward-looking statements as terms identified in federal securities laws.

CSPi 管理階層在今天的電話會議上就公司業務發表的非歷史事實的聲明可能屬於聯邦證券法中確定的前瞻性聲明。

The words may, will, expect, believe, anticipate, project, plan, intend, estimate, and continue as well as similar expressions are intended to identify forward-looking statements. Forward-looking statements should not be meant as a guarantee of future performance or results. The company cautions you that these statements reflect current expectations about the company's future performance or events and are subject to several uncertainties, risks, and other influences, many of which are beyond the company's control that may influence the accuracy of the statements and the projections upon which the segment and statements are based. Factors that may affect the company's results include, but are not limited to, the risks and uncertainties discussed in the Risk Factor section on the annual report on Form 10-K and the quarterly report on Form 10-Q filed with the Securities and Exchange Commission.

可能、將、期望、相信、預期、計劃、計劃、打算、估計和繼續等詞語以及類似的表達方式旨在識別前瞻性陳述。前瞻性陳述不應被視為對未來績效或結果的保證。本公司提醒您，這些陳述反映了目前對公司未來業績或事件的預期，並受到多種不確定性、風險和其他影響，其中許多因素超出了公司的控制範圍，可能會影響陳述和預測的準確性。可能影響公司業績的因素包括但不限於向美國證券交易委員會提交的 10-K 表年度報告和 10-Q 表季度報告的風險因素部分中討論的風險和不確定性。

Forward-looking statements are based on information available at the time those statements are made and management's good faith belief as of the time with respect to future events. All forward-looking statements are qualified in their entirety by this cautionary statement. And CSPi undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events or otherwise after the date thereof.

前瞻性陳述是基於做出這些陳述時可獲得的資訊以及管理階層當時對未來事件的善意信念。所有前瞻性陳述均受此警示性陳述的約束。CSPi 不承擔公開修改或更新任何前瞻性聲明的義務，無論是由於新資訊、未來事件或在聲明日期之後出現的其他情況。

With that, I'll turn the call over to Victor Dellovo, Chief Executive Officer. Vic, please go ahead.

接下來，我會將電話轉給執行長 Victor Dellovo。維克，請繼續。

Thanks, Michael, and good morning, everyone. Earlier this morning, we announced our fiscal 2024 third-quarter results. And with the supply chain issue well passed, I'm pleased to report our business has returned to a more normalized revenue run rate, and we have focused on driving our higher-margin business while building the required infrastructure to drive the success of the emerging AZT product -- PROTECT product line.

謝謝邁克爾，大家早安。今天早些時候，我們公佈了 2024 財年第三季業績。隨著供應鏈問題的順利解決，我很高興地報告我們的業務已恢復到更正常化的收入運行率，我們專注於推動利潤率更高的業務，同時建立所需的基礎設施以推動新興市場的成功AZT產品－PROTECT產品線。

We have been able to consistently grow the service business and fiscal third quarter with no exception as the service revenue increased 10% and contributed 150 basis points improvement to the gross margin percentage over the prior year level. The AZT PROTECT offering has the capability to dramatically reshape our high-performance product business and our entire company. Customer enthusiasm for the product line remains high, and the team is generating leads in building an attractive pipeline.

我們能夠持續成長服務業務，第三財季無一例外，服務收入成長了 10%，毛利率比上年水準提高了 150 個基點。AZT PROTECT 產品能夠大幅重塑我們的高性能產品業務和整個公司。客戶對該產品線的熱情仍然很高，該團隊正在打造有吸引力的產品線方面發揮主導作用。

Moreover, we are continuing to extend the brand awareness of AZT product through multiple awards, including being named winner in the Application Security category at the 2024 Fortress Cybersecurity Awards presented by Business Intelligence Group. Overall, the team has done an incredible job as this was the ninth major industry award for the AZT PROTECT since the launch of the following -- follow success at the Cybersecurity Excellence Award, the Global InfoSec Award at RSA and the Globee Award for Cybersecurity.

此外，我們還透過多個獎項繼續擴大 AZT 產品的品牌知名度，包括在 Business Intelligence Group 頒發的 2024 年 Fortress 網路安全獎中被評為應用程式安全類別獲獎者。總體而言，該團隊完成了令人難以置信的工作，這是 AZT PROTECT 自推出以來第九次獲得主要行業獎項 - 繼網路安全卓越獎、RSA 全球資訊安全獎和網路安全 Globee 獎的成功之後。

During the quarter, we also signed some small mid-tier manufacturing customers located in the Midwest. We have many other similar opportunities that are being pursued. To ensure we maintain the momentum and remain focused, we recently hired Greg Pysher, an experienced 20-year OT (sic - see press release, "IT") industry sales veteran as VP of Sales to head up the AZT product -- PROTECT business.

本季度，我們也簽署了一些位於中西部的小型中型製造客戶。我們還有許多其他類似的機會正在尋求。為了確保我們保持勢頭並保持專注，我們最近聘請了Greg Pysher，他是一位經驗豐富的20 年OT（原文如此- 請參閱新聞稿，“IT”）行業銷售資深人士，擔任銷售副總裁，負責AZT 產品- PROTECT 業務。

Throughout his career, Greg has consistently driven sales and is known for building and training high-performance teams in a complex solution sales and mentoring them to achieve ambitious goals. Greg is already transforming our sales team and in just a few weeks, his impact is being felt throughout the organization.

在他的整個職業生涯中，Greg 始終如一地推動銷售，並以在複雜的解決方案銷售中建立和培訓高績效團隊並指導他們實現雄心勃勃的目標而聞名。格雷格已經在改造我們的銷售團隊，在短短幾週內，整個組織都感受到了他的影響。

While our multi-pronged sales strategy includes engaging with Fortune 500 companies, Greg immediate goals to ensure we have the right sales team to focus on small- to mid-tier enterprise because of the shorter sales cycle. We will continue to pursue larger opportunities directly or through our partners despite the longer sales cycle because each one can represent multimillion-dollar contract opportunities, like the one we signed in the second quarter, which helped AZT PROTECT awareness in the market.

雖然我們的多管齊下的銷售策略包括與財富 500 強公司合作，但格雷格的近期目標是確保我們擁有合適的銷售團隊來專注於中小型企業，因為銷售週期較短。儘管銷售週期較長，但我們將繼續直接或透過我們的合作夥伴尋求更大的機會，因為每個機會都可以代表數百萬美元的合約機會，就像我們在第二季度簽署的合約機會一樣，這有助於提高AZT PROTECT 在市場上的知名度。

Greg is also helping the team prepare for several upcoming events such as the American Petroleum Institute Conference taking place in Houston. This conference is the only cybersecurity conference dedicated to oil and natural gas industry and has a loyal and dedicated attendee base.

格雷格還幫助團隊準備即將舉行的幾項活動，例如在休士頓舉行的美國石油學會會議。該會議是唯一專門針對石油和天然氣行業的網路安全會議，擁有忠實而專注的與會者基礎。

As we engage with the largest oil company in the world and the water treatment plants, the process to evaluate AZT in these large oil and water treatments have taken months. Just to get set up in their system to do a proof of concept or a POC has taken four to six months. The team will also attend the industry -- Industrial Control System Cybersecurity Conference being held in Atlanta. This conference is the largest and longest-running event series focused on industrial cybersecurity.

當我們與世界上最大的石油公司和水處理廠合作時，評估這些大型石油和水處理中的 AZT 的過程花費了數月時間。只是在他們的系統中進行設定以進行概念驗證或 POC 就需要四到六個月的時間。該團隊還將參加在亞特蘭大舉行的產業——工業控制系統網路安全會議。本次會議是規模最大、持續時間最長的專注於工業網路安全的系列活動。

Since 2002, the conference has gathered ICS Cybersecurity stakeholders across various industries and attracts operations and control engineers, IT government vendors and academics. We believe these and other conferences are a right opportunity to further expand our brand presence within the OT marketplace.

自 2002 年以來，該會議聚集了各行業的 ICS 網路安全利益相關者，並吸引了營運和控制工程師、IT 政府供應商和學者。我們相信這些會議和其他會議是進一步擴大我們在 OT 市場中品牌影響力的絕佳機會。

We have also successfully executed our AZT PROTECT partnership program over the past few months. We entered a new integration partnership with Forescout Technologies, which offers comprehensive asset intelligence and control across IT, OT and IoT environments, trusted by Fortune 100 organizations, government agencies and large enterprises for over two decades. Forescout serves as a cornerstone for managing cyber risk, ensuring compliance and mitigating threats.

在過去的幾個月裡，我們也成功執行了 AZT PROTECT 合作夥伴計畫。我們與 Forescout Technologies 建立了新的整合合作夥伴關係，該公司提供跨 IT、OT 和 IoT 環境的全面資產智慧和控制，二十多年來深受財富 100 強組織、政府機構和大型企業的信賴。Forescout 是管理網路風險、確保合規性和減輕威脅的基石。

This full integration will take some time, but we believe the opportunity could be huge. In addition, Ebryx, a managed security service provider, performed a lengthy in-house red-team evaluation of AZT PROTECT prior to adding ARIA to its existing portfolio of technology partners. Ebryx is a leading provider of innovative cybersecurity services and solutions to commercial as well as government and public sector customers in North America, EMEA, and APAC regions.

這種全面整合需要一些時間，但我們相信機會可能是巨大的。此外，託管安全服務供應商 Ebryx 在將 ARIA 添加到其現有技術合作夥伴組合之前，對 AZT PROTECT 進行了長時間的內部紅隊評估。Ebryx 是一家領先的創新網路安全服務和解決方案供應商，為北美、歐洲、中東和非洲和亞太地區的商業以及政府和公共部門客戶提供服務。

Lastly, Worldwide Technology, a large global reseller of IT and cybersecurity solutions will supply the award-winning AZT PROTECT solutions to its customers. I believe this approach ensures we are using our resources and those of our partners to significantly raise the profile of AZT offering and build revenue opportunities.

最後，全球大型 IT 和網路安全解決方案經銷商 Worldwide Technology 將為其客戶提供屢獲殊榮的 AZT PROTECT 解決方案。我相信這種方法可以確保我們利用我們和合作夥伴的資源來大幅提高 AZT 產品的形象並創造收入機會。

In only three weeks, Greg has currently signed multiple resellers. And Greg is confident we can increase the number of OT-focused resellers by December to over a dozen. Locations of these resellers are all over the world, including Chile, Peru, Brazil, Morocco, Norway, India, Australia, and Iberia. Our largest partnership is Rockwell, and we are recently -- we have recently been selected to update the industry on how to measure the cybersecurity risk-facing industrial operations and how to guide against them at the Rockwell Automation Fair in November. The event is being held in Anaheim, California. And Gary Southwell, Vice President and General Manager of High Performance Products segment, will be a guest speaker. He will be presenting an in-depth review of the latest attack techniques in their financial impact.

在短短三週內，格雷格目前已與多家經銷商簽約。Greg 有信心我們可以在 12 月之前將專注於 OT 的經銷商數量增加到十幾家。這些經銷商的地點遍佈世界各地，包括智利、秘魯、巴西、摩洛哥、挪威、印度、澳洲和伊比利半島。我們最大的合作夥伴是羅克韋爾，最近我們被選中在 11 月的羅克韋爾自動化博覽會上向業界通報如何衡量面臨網路安全風險的工業運作以及如何針對這些風險進行指導。該活動在加州阿納海姆舉行。高性能產品部門副總裁兼總經理 Gary Southwell 將擔任演講嘉賓。他將深入探討最新攻擊技術的財務影響。

Gary will outline how insurance providers are measuring the risk of how companies can comply with the new insurance and regulatory requirements, and we'll share a range of use cases to demonstrate how companies can apply reduction techniques to reduce measurable risk, including a high-profile ransomware attack on Merck, which resulted in a $1.4 billion impact and led to a lengthy legal battle with the insurers to recover losses. Working with Rockwell together, we will be delivering new solutions to manufacturing environment that complement existing passive and active defense, and pick up what they miss.

蓋瑞將概述保險公司如何衡量公司如何遵守新的保險和監管要求的風險，我們將分享一系列用例來展示公司如何應用降低技術來降低可衡量的風險，包括高風險對默克(Merck) 的profile勒索軟體攻擊造成了14 億美元的損失，並導致與保險公司進行漫長的法律鬥爭以挽回損失。我們將與羅克韋爾合作，為製造環境提供新的解決方案，以補充現有的被動和主動防禦，並彌補他們所遺漏的東西。

Before I review the Technology Solutions, TS business, I want to spend a couple of minutes highlighting the recent CrowdStrike-induced Windows outage and the opportunity it presents for AZT. While the target market for AZT PROTECT was initially focused on operational technology, or OT, it was always our intent to engage the information technology or IT market professionals.

在回顧技術解決方案、TS 業務之前，我想花幾分鐘重點介紹最近由 CrowdStrike 引起的 Windows 中斷及其為 AZT 帶來的機會。雖然 AZT PROTECT 的目標市場最初專注於營運技術 (OT)，但我們始終致力於吸引資訊科技或 IT 市場專業人士。

We've had already commenced discussion with IT professionals. So the timing of the outage was a benefit to our efforts. We believe -- had AZT PROTECT been previously deployed, the outage would have been controlled at the corporate level. It has been estimated that the cost of the outages in the billions of dollars and a Delta Airlines' CEO has said, it cost his company $500 million.

我們已經開始與 IT 專業人士進行討論。因此，停電的時機對我們的努力是有利的。我們相信，如果之前部署了 AZT PROTECT，中斷就會在公司層級得到控制。據估計，這次停電造成的損失達數十億美元，達美航空執行長表示，這起事件對他的公司造成了 5 億美元的損失。

We believe companies using AZT PROTECT protection capability can prevent both malicious code as well as flawed updating from taking critical systems down. We've proven this capability in the field under real-life operational circumstances. We can ensure that the untested updates do not become active on the systems, helping corporations and organizations at all levels avoid another CrowdStrike type of disaster as it become the norm for IT applications and cybersecurity vendors to send updates directly to their applications.

我們相信，使用 AZT PROTECT 保護功能的公司可以防止惡意程式碼和有缺陷的更新導致關鍵系統癱瘓。我們已經在實際操作環境下證明了這種能力。我們可以確保未經測試的更新不會在系統上激活，從而幫助各級企業和組織避免另一場CrowdStrike 類型的災難，因為IT 應用程式和網路安全供應商直接向其應用程式發送更新已成為常態。

Unfortunately, as a CrowdStrike event has demonstrated a few customers to test these updates and just allow them to update automatically, whether intentional or not, untested supply chain updates can wreak more havoc on a critical system than most cyberattacks. If an update to the system puts lives in danger due to the outage, it should not be deployed without some formal verification test. Same goes for servers running any critical business process.

不幸的是，正如 CrowdStrike 事件所示，一些客戶測試了這些更新並允許它們自動更新，無論是有意還是無意，未經測試的供應鏈更新可能比大多數網路攻擊對關鍵系統造成更大的破壞。如果系統更新因中斷而導致生命危險，則在沒有經過正式驗證測試的情況下不應部署該更新。對於運行任何關鍵業務流程的伺服器也是如此。

The Technology Solution or TS business continues to perform well and generate the majority of the quarter's revenue. The success of the TS continues to be driven by our customers, increased use of implementation, installation, and training capabilities. We continue to add new MSP customers, and we are currently awaiting decisions on several big orders that if they go in our favor could positively impact our results in fiscal 2025 and beyond.

技術解決方案或 TS 業務繼續表現良好，並產生了本季的大部分收入。TS 的成功持續受到我們的客戶以及更多實施、安裝和培訓能力的使用的推動。我們繼續增加新的 MSP 客戶，目前正在等待幾個大訂單的決定，如果這些訂單對我們有利，可能會對我們 2025 財年及以後的業績產生積極影響。

The activity is encouraging. And to add more color, we are in the process of implementing a wireless conversion to over 70 to 80 locations of a global hospitality company. This work will continue through 2025.

這項活動令人鼓舞。為了增添更多色彩，我們正在為一家全球酒店公司的 70 至 80 多個地點實施無線轉換。這項工作將持續到 2025 年。

We also are working with one of the largest freight operators specializing in containerized ocean exports serving numerous ports worldwide, and we will be double the number of container ships for which we are performing equipment conversions and will continue to be their MSP for each and every ship.

我們也與專門從事貨櫃海運出口的最大貨運業者之一合作，為全球眾多港口提供服務，我們將把我們正在進行設備改造的貨櫃船數量增加一倍，並將繼續成為他們每艘船的 MSP 。

We also continued to generate higher levels of interest in our UCaaS offering. And during the current fiscal fourth quarter, we already signed several new customers. The momentum with the UCaaS is building, and we expect to enter the new fiscal year with an annual revenue run rate that is more than double than what it was entering in fiscal 2024.

我們也繼續引起人們對我們的 UCaaS 產品的更高興趣。在目前第四財季，我們已經簽署了幾個新客戶。UCaaS 的勢頭正在增強，我們預計進入新財年時，年收入運行率將是 2024 財年的兩倍以上。

In summary, the strength of the TS business has allowed us to fund and develop AZT PROTECT. The TS business has three lines of recurring revenue: the UCaaS, the cloud practice and managed service practice. This was a slow methodical process over the last few years, but we now have all three generating consistent profits. We are building the AZT practice with the same methodology and determination as we did with the other lines of business. So I'm highly confident we will be generating consistent profits in the near future.

總之，TS 業務的實力使我們能夠資助和開發 AZT PROTECT。TS 業務擁有三個經常性收入線：UCaaS、雲端實務和託管服務實務。在過去的幾年裡，這是一個緩慢而有條理的過程，但現在我們三個都在產生穩定的利潤。我們正在使用與其他業務線相同的方法和決心來建立 AZT 實踐。因此，我非常有信心我們將在不久的將來產生持續的利潤。

Today, we are in the process of deploying additional resources to ensure we have organizational infrastructure to support the business in 2025 and thereafter. AZT PROTECT has the potential to revolutionize on our OT professionals' approach to their responsibilities. And recent events reinforce that IT professionals also need to be vigilant and ensure their business are not compromised, whether from external threats or third-party software update. Our commitment to develop, innovate in high-margin products and services has enabled us to expand our gross margins and grow our cash balance to a near record level.

今天，我們正在部署更多資源，以確保我們擁有支援 2025 年及之後業務的組織基礎設施。AZT PROTECT 有潛力徹底改變我們 OT 專業人員履行職責的方法。最近發生的事件表明，IT 專業人員也需要保持警惕，確保他們的業務不會受到損害，無論是來自外部威脅還是第三方軟體更新。我們致力於開發和創新高利潤產品和服務，這使我們能夠擴大毛利率並將現金餘額增加到接近創紀錄的水平。

With that, I will now ask Gary to provide a brief overview of the fiscal third-quarter financial performance. Gary?

接下來，我現在請加里簡要概述第三財季的財務表現。加里？

Thanks, Victor. For the third quarter ended June 30, we reported revenues of $13.1 million compared to revenue of $17.7 million for the fiscal third quarter ended June 30, 2023. I want to point out that at the year-ago fiscal third quarter, we converted a sizable portion of backlog to revenue as the supply chain issues had eased, and we were able to get key components to complete and ship customer orders.

謝謝，維克多。截至 6 月 30 日的第三季度，我們報告的收入為 1,310 萬美元，而截至 2023 年 6 月 30 日的第三財季收入為 1,770 萬美元。我想指出的是，在去年第三財季，隨著供應鏈問題的緩解，我們將很大一部分積壓訂單轉化為收入，並且我們能夠獲得關鍵組件來完成和運送客戶訂單。

As Victor said earlier, we have returned to a more normalized business environment. In fact, revenue was relatively flat compared to the 2024 fiscal second quarter. Gross profit for the three months ended June 30, 2024, was $4.6 million or 35% of sales, compared to $5.9 million or 33.5% of sales, representing 150-basis-point gross margin percentage improvement despite the lower year-over-year revenue as higher margin services revenue fuel the improvement.

正如維克多早些時候所說，我們已經回到了更正常化的商業環境。事實上，與 2024 財年第二季相比，營收相對持平。截至2024 年6 月30 日的三個月毛利為460 萬美元，佔銷售額的35%，而毛利為590 萬美元，佔銷售額的33.5%，儘管收入同比下降，但毛利率提高了150 個基點由於較高的利潤率服務收入推動了這一改善。

For the third quarter, our engineering and development expenses were $734,000 compared to $741,000. Our SG&A costs include continuing investment required to build out the AZT sales, support and marketing where -- and the amounts were $4.6 million for both fiscal years. For the fiscal third quarter, we reported a net loss of $185,000 or $0.02 per common share compared to a net income of $2.5 million or $0.26 per diluted common share for the fiscal third quarter ended June 30, 2023. In the prior year, our tax benefit was $1.7 million for the fiscal third quarter, primarily for the release of the valuation allowance against our deferred tax asset.

第三季度，我們的工程和開發費用為 734,000 美元，去年同期為 741,000 美元。我們的 SG&A 成本包括建立 AZT 銷售、支援和行銷所需的持續投資，兩個財年的金額均為 460 萬美元。在第三財季，我們報告的淨虧損為185,000 美元，即每股普通股0.02 美元，而截至2023 年6 月30 日的第三財季淨利潤為250 萬美元，即每股稀釋普通股0.26美元。去年第三財季，我們的稅務優惠為 170 萬美元，主要用於釋放遞延稅資產的估價備抵。

For the third quarter, we generated operating cash flow of $2.4 million. And as of June 30, 2024, we had cash and cash equivalents of $28.9 million compared to $13.9 million in the year-ago fiscal third quarter and $25.2 million at the end of our 2023 fiscal year.

第三季度，我們產生了 240 萬美元的營運現金流。截至 2024 年 6 月 30 日，我們的現金及現金等價物為 2,890 萬美元，而去年同期第三財季為 1,390 萬美元，2023 財年末為 2,520 萬美元。

We believe that the continued success of the TS business, our ability to focus on selling higher-margin products and services gives us the flexibility to leverage our resources to execute the multipronged sales strategy to target small, medium, and large enterprises for AZT PROTECT. During the fiscal third quarter 2024, the company repurchased 4,800 shares for a total cost of $70,000. We currently have 9.7 million shares outstanding.

我們相信，TS 業務的持續成功以及我們專注於銷售高利潤產品和服務的能力，使我們能夠靈活地利用我們的資源來執行多管齊下的銷售策略，以AZT PROTECT 為目標的小型、中型和大型企業。2024 財年第三季度，該公司回購了 4,800 股股票，總成本為 70,000 美元。我們目前有 970 萬股已發行股票。

Lastly, the Board of Directors approved a quarterly dividend of $0.03 per share payable on September 10, 2024, to shareholders of record on the close of business on August 23, 2024. With that, I will turn it over to the operator to take your questions.

最後，董事會批准於 2024 年 9 月 10 日向 2024 年 8 月 23 日收盤時登記在冊的股東派發每股 0.03 美元的季度股息。這樣，我將把它交給接線員來回答您的問題。

Certainly. Everyone, at this time, we will be conducting a question-and-answer session. (Operator Instructions) Joseph Nerges, Segren Investments.

當然。大家好，這個時候我們進行一個問答環節。（操作員說明）Joseph Nerges，Segren Investments。

Well, first, congratulations on all the awards that AZT PROTECT has gotten. And of course, the expansion of the partnerships to some very large organizations is also positive going forward.

首先，恭喜 AZT PROTECT 獲得的所有獎項。當然，將合作關係擴展到一些非常大的組織也是積極的。

My first question is really on the integration of AZT PROTECT into the Forescout platform. Where is that? And how long do you anticipate that to take?

我的第一個問題實際上是關於將 AZT PROTECT 整合到 Forescout 平台中。哪裡是？您預計需要多長時間？

We haven't started it yet. We are planning on -- they're doing planning sessions right now, and it could be anywhere from four to six months for that to be fully integrated in testing and tested through.

我們還沒開始。我們正在計劃——他們現在正在進行計劃會議，可能需要四到六個月的時間才能完全整合到測試中並進行測試。

Okay. So it's going to be obviously some from our end and some from their end. I'm assuming that's --

好的。所以顯然有些來自我們這邊，有些來自他們那邊。我假設那是--

Yeah. They've engaged a team that's been -- that we'll work with to build all the APIs, but it's --

是的。他們聘請了一個團隊，我們將與該團隊合作建立所有 API，但它是--

Lengthy process.

漫長的過程。

It's a lengthy process, right? And you're dealing with these large companies as usually even on the integration. And it could be faster. I'm just not exactly sure -- I don't know how fast the team is going to be, and there's going to be a lot of testing that has to be -- that we have to go through with them. So we're hoping it's faster, but we'll see.

這是一個漫長的過程，對嗎？您與這些大公司打交道時，甚至在整合方面也是如此。而且速度可能會更快。我只是不太確定——我不知道團隊的速度有多快，並且必須進行大量的測試——我們必須與他們一起完成。所以我們希望它能更快，但我們拭目以待。

I'm not aware if they have any outside -- are you unique in this -- in the Forescout, do you know that if you're unique in that almost all their platform was either developed internally or was via mergers, where they have integrated other systems after they bought the company. So do you know if there was any other outside suppliers to their platform? Like, our case would be an outside --

我不知道他們是否有任何外部 - 你在這方面是獨一無二的 - 在 Forescout 中，你是否知道如果你是獨一無二的，因為幾乎所有他們的平台都是內部開發的或通過合併，他們有他們收購公司後整合了其他系統。那麼您知道他們的平台是否有其他外部供應商？就像，我們的案例是外在的--

I didn't ask the question, to be honest with you. When we met them and we said -- we were pretty happy that they saw how we could -- they have a great product and how we can complement that product and not cannibalize anything that they currently already have, right, because they wouldn't want two competing products against each other, whether it was -- I'm guessing whether it was another outside partner or something that they own internally if we were doing the same thing, then I'm sure they wouldn't have signed this up.

老實說，我沒有問這個問題。當我們見到他們時，我們說——我們很高興他們看到了我們的能力——他們有一個很棒的產品，我們如何補充該產品，而不是蠶食他們目前已經擁有的任何東西，對吧，因為他們不會想要兩種相互競爭的產品，無論是——我猜是另一個外部合作夥伴還是他們內部擁有的東西，如果我們做同樣的事情，那麼我確信他們不會簽署這個協議。

Yeah. Well, I don't know of anything where they have a product, let's put it this way, that stops an attack like AZT PROTECT would do. I don't know. Just another follow-up here on with Rockwell. With -- and of course, with the debacle with the CrowdStrike faulty software download, you -- there's got to be a significant number of their clientele or customers that have been -- that were affected. It have to be in the OT environment because of such a dramatic amount of people were affected.

是的。好吧，我不知道他們有什麼產品可以阻止像 AZT PROTECT 這樣的攻擊。我不知道。這是羅克韋爾的另一個後續行動。當然，隨著 CrowdStrike 錯誤軟體下載的崩潰，他們的客戶或顧客中肯定有相當多的人受到了影響。它必須在 OT 環境中，因為受到影響的人數如此之多。

So I would assume that they have a number of customers currently that were going through that problem. Do we know of anything? Have we gotten any update or any feel for what happened at the Rockwell via the CrowdStrike debacle, if you want to call it that?

所以我假設他們目前有許多客戶正在經歷這個問題。我們知道什麼嗎？如果你想這麼稱呼的話，我們是否透過 CrowdStrike 災難獲得了任何最新消息或對 Rockwell 發生的事情有任何感覺？

Yeah, they pointed us to work with their partners that sold the systems, and that's kind of what we're building a food chain with their partners. The biggest thing with the Siemens or Rockwells, the Emersons of the world and the process that we're going through is to get certified on the systems. And that's kind of what we do with Rockwell and they love what we have to offer. I think that's why they invited us to do a talk at the upcoming show. Because like they said, we're very unique on how we go to market with the way we protect applications at the core level.

是的，他們指示我們與銷售系統的合作夥伴合作，這就是我們與他們的合作夥伴建立食物鏈的方式。對於西門子或羅克韋爾、艾默生以及我們正在經歷的過程來說，最重要的事情就是獲得系統認證。這就是我們與羅克韋爾所做的事情，他們喜歡我們提供的服務。我想這就是為什麼他們邀請我們在即將舉行的展會上演講的原因。因為正如他們所說，我們在進入市場以及保護核心層級應用程式的方式方面非常獨特。

So that's kind of what we've been doing now that we've got approved and we're working with the marketing team in the magazine and all that stuff, now they've -- we've had their blessing and now we're setting up each and every one of their partners. But there's a process that goes through that.

這就是我們現在一直在做的事情，我們已經獲得批准，我們正在與雜誌的營銷團隊以及所有這些東西合作，現在他們 - 我們已經得到了他們的祝福，現在我們'正在建立他們的每一位合作夥伴。但這是有一個過程的。

And I think that's part of the thing. I think everybody has to understand is that when you sign up new partners, you have to educate them and then you have to get mind share. And it's not the only thing they do all day and every day. So it's definitely a process and putting training material from -- and then we had to put training material for companies outside the country and changing the language so they could read it. There's a lot that goes in.

我認為這就是事情的一部分。我認為每個人都必須明白，當你與新夥伴簽約時，你必須教育他們，然後你必須獲得思想分享。這並不是他們每天所做的唯一事情。所以這絕對是一個過程，然後我們必須為國外的公司提供培訓材料並更改語言，以便他們可以閱讀。有很多東西要進去。

And because we're a small company, you can only do so much so fast, right? So I feel like we're building the base, the partnerships, getting inside these resellers, doing training material, marketing material -- there's a process. We're setting the foundation at this stage.

因為我們是一家小公司，所以你只能這麼快做這麼多，對吧？所以我覺得我們正在建立基礎、建立合作關係、進入這些經銷商、製作培訓材料、行銷材料——這是一個過程。我們現階段正在打好基礎。

Well, I guess my only point on the Rockwell question was basically, a number of their customers were affected. And let's put it this way, there's more urgency from a customer standpoint when they are being affected with different things as to how we could stop it. And I'm sure Delta does not want to go through what they went through again. And it has to be the same case with the Rockwell Group. There's got to be a lot of them that were affected that don't want to go through it again.

好吧，我想我對羅克韋爾問題的唯一觀點基本上是，他們的一些客戶受到了影響。讓我們這樣說，從客戶的角度來看，當他們受到不同事情的影響時，我們如何阻止它變得更加緊迫。我確信達美航空不想再經歷他們所經歷的事情。羅克韋爾集團的情況也必須如此。一定有很多人受到了影響，不想再經歷一次。

So -- well, I'd say that there's an urgency there for correction, some -- a solution, let's put it that way. And I'll take one quick more follow-up here. What's different with your IT version of AZT PROTECT? You say you've come out with an IT version. And how do we differentiate ourselves a little bit? Can you add a little color to that or attempting to do with the IT version?

所以——嗯，我想說，迫切需要糾正，一些——解決方案，讓我們這樣說。我將在這裡進行進一步的快速跟進。您的 IT 版本的 AZT PROTECT 有什麼不同？你說你出了一個IT版本。我們如何讓自己與眾不同呢？您能否為此添加一點色彩或嘗試使用 IT 版本？

Well, the IT version, because of all these updates, they -- in the OT space, it's kind of more locked down, right? Everything is kind of scheduled. So it's a more stable environment. With the IT, where there's constant updates, whether it's any type of your -- any software you're running, we had to build a product that scans all the updates, looks at if it's from a valid source. And then in a lot of cases, the way we built it was for the individual to approve the update.

好吧，IT 版本，由於所有這些更新，它們——在 OT 空間中，它更加鎖定，對吧？一切都是有計劃的。所以這是一個更穩定的環境。對於不斷更新的 IT，無論您執行的是任何類型的軟體，我們都必須建立一個產品來掃描所有更新，檢查它是否來自有效來源。在很多情況下，我們建構它的方式是由個人批准更新。

We're going to tell it's from a source, a valid source. And then it will -- at that stage, it will be up to the individual to basically approve the update. And that's kind of where in the CrowdStrike, it wouldn't have been an automatic update. We would have basically stopped it and looked at it and would have given the customer the time to test it and not just automatically let it go through.

我們將告訴它來自一個來源，一個有效的來源。然後，在那個階段，基本上將由個人批准更新。這就是 CrowdStrike 中不會自動更新的地方。我們基本上會停止它並查看它，並給客戶時間來測試它，而不是自動讓它通過。

And that's kind of where I think some of the messaging on the CrowdStrike is like nothing happens unless you approve it, you analyze it. And then you should be testing it, but that's, of course, not every company is going to do that, and that's kind of where they get into some problems.

這就是我認為 CrowdStrike 上的一些消息就像什麼都不會發生一樣，除非你批准它，你分析它。然後你應該測試它，但當然，並不是每個公司都會這樣做，這就是他們遇到一些問題的地方。

And this is not really available, outside of -- in many other cases. In other words, this idea of testing before has not been implemented too often other places -- on the software competitors.

在許多其他情況下，這並不是真正可用的。換句話說，這種測試的想法之前並沒有在其他地方（軟體競爭對手）經常實施。

Yeah. Well, see, the other thing we do, too is, while -- a lot of these patches is because they have a gap, right? And then -- so they're vulnerable potentially without that patch. Where if you had AZT to complement all these products, we would still protect you 100% while a CrowdStrike or Sophos or Trend Micro or whoever else that's out in the marketplace ran their testing and before they were updated.

是的。好吧，你看，我們做的另一件事也是——很多補丁是因為它們有間隙，對嗎？然後——所以如果沒有那個補丁，它們可能很容易受到攻擊。如果您有 AZT 來補充所有這些產品，當 CrowdStrike、Sophos、Trend Micro 或市場上的其他任何人在更新之前進行測試時，我們仍然會 100% 保護您。

Okay. Well, great. It sounds -- like pieces in place, just a matter of time to (multiple speakers)

好的。嗯，太好了。聽起來——就像各個部分都已就位，只是時間問題（多個發言者）

Yeah, yeah, we got -- we're building the -- it's -- I had mentioned it, at least the last two quarters, so everybody has a clear understanding that we have built three other profitable practices under the umbrella. It takes time. You build a food chain, you build a sales force, you have to build rebate programs, you have to build marketing. And the sub-30 people in the HPP, just to give a concept of how many people are doing all this. And most of those guys are engineers, so -- that developed the product. So -- and we hire sparingly, and we try to do it [at] what makes sense, and we try to hire the right -- I can't hire enough salespeople.

是的，是的，我們正在建立——我已經提到過，至少在過去兩個季度，所以每個人都清楚地了解我們已經在保護傘下建立了其他三個盈利實踐。這需要時間。你建立了一條食物鏈，你建立了一支銷售隊伍，你必須建立回扣計劃，你必須建立行銷。HPP 中的 30 位以下人員，只是為了讓大家了解有多少人在做這一切。這些人大多都是工程師，所以──他們開發了產品。所以——我們很少僱用員工，我們努力在有意義的地方做事，我們努力僱用合適的人——我無法僱用足夠的銷售人員。

We can't afford it. So what we're trying to do is to build a -- the food chain using partners and getting the right partners and getting the right OT, right? We've never been in the OT space historically. So all these partners -- and that's kind of why when we chose to bring Greg on, he has 20 years of working basically for the same company that only sold into the OT space. Nothing else.

我們買不起。因此，我們正在努力做的是建立一個——利用合作夥伴、找到合適的合作夥伴並獲得合適的 OT 的食物鏈，對嗎？我們歷史上從未涉足過 OT 領域。所以所有這些合作夥伴 - 這就是為什麼當我們選擇讓 Greg 加入時，他基本上在同一家只向 OT 領域銷售的公司工作了 20 年。沒有別的了。

Just a matter of time, guys. That's for --

只是時間問題，夥計們。那是為了--

Yeah. Like I said, we built three other little businesses inside. The MSP are recurring revenue models, by the way. It took a little time, but guess what, it's a consistent business now that generates profits, month in and month out.

是的。就像我說的，我們在裡面建立了另外三個小企業。順便說一句，MSP 是經常性收入模式。這花了一點時間，但你猜怎麼著，現在這是一項穩定的業務，每個月都會產生利潤。

(Operator Instructions) Thank you. That concludes our Q&A session. I will now hand the conference back to Victor Dellovo for closing remarks. Please go ahead.

（操作員說明）謝謝。我們的問答環節到此結束。現在我將把會議交還給維克多·戴洛沃（Victor Dellovo）致閉幕詞。請繼續。

Thank you. As always, I wanted to thank our shareholders for your continued interest and support. Good things are happening, and the industry is taking notice of CSPi's award-winning AZT PROTECT. The activity we are experiencing is exciting, and we look forward to sharing our progress in fiscal 2024 fourth-quarter and full-year results quarter in December. Until then, be well, stay safe, and enjoy the rest of the summer.

謝謝。一如既往，我要感謝我們的股東一直以來的關注與支持。好事正在發生，業界正在關注 CSPi 屢獲殊榮的 AZT PROTECT。我們正在經歷的活動令人興奮，我們期待在 12 月分享我們在 2024 財年第四季和全年業績季度的進展。在那之前，祝你身體健康，保持安全，享受夏天剩下的時光。

Thank you, everyone. This concludes today's event. You may disconnect at this time, and have a wonderful day. Thank you for your participation.

謝謝大家。今天的活動到此結束。此時您可能會斷開連接，並度過美好的一天。感謝您的參與。