Digi International Inc (DGII) 2024 Q1 法說會逐字稿

Good day, and thank you for standing by, and welcome to the fiscal Q1 2024 Digi International Inc earnings conference call.

美好的一天，感謝您的耐心等待，歡迎參加 Digi International Inc 2024 年第一財季財報電話會議。

(Operator Instructions) Please be advised that today's conference is being recorded.

（操作員指示）請注意，今天的會議正在錄製中。

I would now like to hand the conference over to your speaker today, Jamie Loch, CFO.

現在我想將會議交給今天的發言人、財務長傑米洛克 (Jamie Loch)。

Please go ahead.

請繼續。

Thank you, good day everyone.

謝謝大家，大家美好的一天。

It's great to talk to you again and thanks for joining us today to discuss the earnings results of Digi International.

很高興再次與您交談，感謝您今天加入我們討論 Digi International 的盈利結果。

Joining me on today's call is Ron Konezny, our President and CEO.

與我一起參加今天電話會議的是我們的總裁兼執行長 Ron Konezny。

We issued our earnings release after the market close yesterday.

我們在昨天收盤後發布了收益報告。

You may obtain a copy the press release through the Financial Releases section of our Investor Relations website at digi.com. This morning Rob will provide a comment on our performance and then we'll take your questions.

您可以透過我們投資者關係網站 digi.com 的財務發布部分取得新聞稿副本。今天早上，羅布將對我們的表現發表評論，然後我們將回答您的問題。

Some of the statements that we make during this call are considered forward-looking and are subject to significant risks and uncertainties.

我們在本次電話會議中所做的一些聲明被認為是前瞻性的，並受到重大風險和不確定性的影響。

These statements reflect our expectations of our future operating and financial performance and speak only as of today's date.

這些陳述反映了我們對未來營運和財務表現的預期，並且僅代表截至今天的情況。

We undertake no obligation to update publicly or revise these forward-looking statements, but we believe the expectations reflected in our forward-looking statements are reasonable.

我們不承擔公開更新或修改這些前瞻性陳述的義務，但我們相信前瞻性陳述中反映的預期是合理的。

We give no assurance that such expectations will be met or that any of our forward-looking statements will prove to be correct.

我們不保證此類期望會得到滿足，也不保證我們的任何前瞻性聲明將被證明是正確的。

For additional information, please refer to the forward-looking statements section in our earnings release and the Risk Factors section of our most recent Form 10-K and subsequent reports on filed with the SEC.

如需了解更多信息，請參閱我們的收益發布中的前瞻性陳述部分以及我們最新的 10-K 表格以及向 SEC 提交的後續報告中的風險因素部分。

Finally, certain financial information disclosed on this call includes non-GAAP measures.

最後，本次電話會議所揭露的某些財務資訊包括非公認會計原則措施。

The information required to be disclosed about these measures, including reconciliations to the most comparable GAAP measures are included in the earnings release.

需要披露的有關這些措施的信息，包括與最具可比性的公認會計準則措施的調節，都包含在收益發布中。

The earnings release is also furnished as an exhibit to Form 8-K that can be accessed through the SEC filings sections of our investor relations website.

收益報告也作為 8-K 表格的附件提供，您可以透過我們投資者關係網站的 SEC 備案部分存取該表格。

Now I'll turn the call over to Ron.

現在我將把電話轉給羅恩。

Thank you, Jamie.

謝謝你，傑米。

Good morning, everyone.

大家，早安。

Before we jump into Q&A, a few comments.

在我們開始問答之前，先發表一些評論。

We have begun our next journey to double ARR and adjust the EBITDA to $200 million in the next five years.

我們已經開始了下一個旅程，在未來五年內將 ARR 翻一番，並將 EBITDA 調整至 2 億美元。

The first quarter in our journey resulted in ARR up 13% year over year, now exceeding our quarterly revenue for the first time in the company's history.

我們第一季的 ARR 年增了 13%，目前在公司歷史上首次超過了我們的季度收入。

ARR demonstrated Digi's progression from a product to a solution provider and significantly improves our visibility and profitability.

ARR 展示了 Digi 從產品到解決方案提供者的進步，並顯著提高了我們的知名度和盈利能力。

ARR was the primary driver helping Digi set a quarterly gross margin record.

ARR 是幫助 Digi 創下季度毛利率紀錄的主要推動力。

We've adopted stronger cost controls, enabling strong profitability in the quarter.

我們採取了更強有力的成本控制，從而在本季度實現了強勁的盈利能力。

Our efforts to optimize our supply chain brought our inventory levels down and helped us generate significant free cash flow.

我們優化供應鏈的努力降低了庫存水平，並幫助我們產生了大量的自由現金流。

We expect our debt refinancing will reduce the amount of cash needed to service our debt by at least $4 million this year.

我們預計今年債務再融資將減少至少 400 萬美元的償債所需現金。

During our first fiscal quarter, we paid off approximately $0.5 a share in debt to reduce our gross debt to approximately $195 million.

在第一個財政季度，我們償還了每股約 0.5 美元的債務，將總債務減少至約 1.95 億美元。

Digi's portfolio of industrial Internet of Things solutions is broad and deep.

Digi 的工業物聯網解決方案組合廣泛且深入。

Enabling us to service the most demanding applications and customers around the world.

使我們能夠為世界各地最嚴苛的應用程式和客戶提供服務。

We will relentlessly innovate and service our customers in an ever-changing security, regulatory, technology, and business environment, helping our customers adapt and succeed.

我們將在不斷變化的安全、監管、技術和商業環境中堅持不懈地創新和服務客戶，幫助客戶適應並取得成功。

At this time, I'd like to turn the call back to the operator for questions and answer session.

此時，我想將電話轉回給接線生進行問答。

Thank you, operator.

謝謝你，接線生。

(Operator Instructions) Tommy Moll, Stephens Inc.

（操作員說明）Tommy Moll，Stephens Inc.

Good morning and thank you for taking my questions.

早上好，感謝您回答我的問題。

Morning, Tommy.

早安，湯米。

I wanted to start on the ARR trends for solutions.

我想從解決方案的 ARR 趨勢開始。

So you're up a little bit quarter over quarter, up year over year but in the low to mid-single percent range on a percentage basis, which is below the long-term trend and aspiration.

因此，季度環比、同比都有小幅增長，但按百分比計算，處於低至中個百分點的範圍內，低於長期趨勢和期望。

So I wonder if you could just unpack some of the dynamics there?

所以我想知道你是否可以解開其中的一些動態？

And do you have any visibility into things, some of the higher growth rates returning anytime soon?

您是否對一些很快就會恢復的較高成長率有任何了解？

Thanks.

謝謝。

Yeah, thanks Tommy, good question.

是的，謝謝湯米，好問題。

We do think solutions has a bright future.

我們確實認為解決方案有著光明的未來。

We in the recent quarters been dealing with delayed decision making, that we think we're going to be improving here.

最近幾個季度，我們一直在處理決策延遲的問題，我們認為我們將在這方面有所改善。

In addition to -- I'd say some rightsizing, especially in the financial services sectors with the ATM networks.

除此之外，我想說一些規模調整，特別是在擁有 ATM 網路的金融服務領域。

But we think the combination of Ventus and SmartSense really over the long term are going to be producing that strong double-digit growth.

但我們認為，從長遠來看，Ventus 和 SmartSense 的結合確實將帶來強勁的兩位數成長。

Thank you, Ron.

謝謝你，羅恩。

As a follow-up, I wanted to turn to capital structure.

作為後續行動，我想轉向資本結構。

Looks like the cash flow management in Q -- in the quarter you just completed was pretty strong, it led you to pay down some debt.

看起來Q中的現金流管理——在你剛完成的季度中相當強勁，它導致你償還了一些債務。

And then there was also the refinancing.

然後還有再融資。

So it's really a two-part question as we go forward.

因此，隨著我們的進展，這實際上是一個由兩部分組成的問題。

How do you think about the level of debt outstanding as we progress through the year?

隨著這一年的進展，您如何看待未償債務水準？

How aggressively do you want to continue to pay that down?

您想多積極地繼續償還這筆費用？

And then just to level, set everyone on your run rate interest expense now.

然後為了平衡，現在將每個人設定為運行利率利息支出。

Maybe your best guess on the second fiscal quarter?

也許您對第二財季的最佳猜測是？

Just give us something to work with, given the changes that have gone in there.

考慮到其中發生的變化，給我們一些可以使用的東西。

Thank you.

謝謝。

Yeah, Tommy, I think the restructuring of the debt was a great deal for us.

是的，湯米，我認為債務重組對我們來說意義重大。

It lowers our interest rate; it puts in a more flexible structure that we can be more aggressive on the paydowns and not leave ourselves overly exposed from a capital perspective.

它降低了我們的利率；它提供了一個更靈活的結構，使我們可以更積極地支付付款，並且從資本角度來看，不會讓自己過度暴露。

So I would anticipate similar to FQ1, continued aggressiveness in paying down the debt.

因此，我預計與第一季類似，將繼續積極償還債務。

It's our primary objective with our working capital allocation.

這是我們營運資金分配的首要目標。

And so we will continue that on for the foreseeable future.

因此，在可預見的未來，我們將繼續這樣做。

In terms of interest expense, I would mouth about just do the math and say that we could reasonably expect about a $4 million interest bill here at FQ2 based on debt levels and where the rate is at.

就利息支出而言，我想說的是，根據債務水平和利率，我們可以合理地預計第二季的利息費用約為 400 萬美元。

All part of why we would aggressively pay that down to continue to work that down sequentially as we move through the year.

這就是為什麼我們會積極地降低費用，以便在這一年中繼續按順序降低費用。

Thank you, Jamie.

謝謝你，傑米。

I'll turn it back.

我會把它轉回來。

Thanks, Tommy.

謝謝，湯米。

Scott Searle, Roth MKM.

斯科特·塞爾，羅斯·MKM。

Hey, good morning, thanks for taking the questions.

嘿，早上好，感謝您提出問題。

Hey, Ron, I'm wondering as we look sequentially into the March quarter, it sounds like there's some stabilization in some of the channels at end markets.

嘿，羅恩，我想知道，當我們按順序查看三月季度時，聽起來終端市場的某些管道有些穩定。

So I was wondering if you could kind of walk through where you're seeing demand strength, where there's still some pockets of inventory, how you're feeling overall about that.

所以我想知道你是否可以介紹一下你所看到的需求強度，哪裡仍然有一些庫存，以及你對此的整體感受如何。

And also wondering if you're seeing an impact as it relates to some of the China Quectel/Fibocom issues.

我還想知道您是否看到了與中國移遠/廣和通問題相關的影響。

Are you seeing some benefits related to demand on that front?

您是否看到了與這方面的需求相關的一些好處？

Hey, good morning, Scott, thanks for the question.

嘿，早上好，斯科特，謝謝你的提問。

One of the things about Digi that I think is a unique attribute is that we're very broad company.

我認為 Digi 的一個獨特屬性是我們是一家非常廣泛的公司。

We service a number of companies across different industrial verticals, across different geographies.

我們為不同行業、不同地區的眾多公司提供服務。

And that portfolio really holds up well in good times and bad.

無論順境或逆境，該投資組合確實能保持良好狀態。

And so there are certain sectors that are softer.

因此，某些行業的表現較為疲軟。

Residential solar for example, is a soft area.

例如，住宅太陽能就是一個軟區域。

But commercial solar, solar farms is very strong.

但商業太陽能、太陽能發電場非常強大。

Medical devices remains really consistent strong.

醫療設備仍然非常強勁。

Mass transit is coming back after being really shattered during COVID.

公共交通在新冠疫情期間遭受嚴重破壞後正在恢復。

So we think that portfolio really holds up well for Digi.

因此，我們認為該投資組合確實適合 Digi。

And we oftentimes stated, we don't necessarily run as fast as the cheetahs, but we're much slower than the turtles.

我們常說，我們不一定跑得像獵豹那麼快，但我們比海龜慢得多。

Now on your second question, we haven't seen the dramatic impact on say, Quectel and Fibocom and the concern around Chinese sourced cellular radios, there certainly are pockets of them.

現在關於你的第二個問題，我們還沒有看到對移遠通訊和廣和通等公司的巨大影響，以及對中國來源的蜂窩無線電的擔憂，但肯定有一些影響。

And obviously those -- the competitors to those companies are advocating further case to be made.

顯然，這些公司的競爭對手正在主張採取進一步的行動。

I do think it's good for us to have choice, both from Western suppliers and some suppliers out East.

我確實認為對我們來說有選擇是件好事，無論是來自西方供應商還是來自東方的一些供應商。

But it hasn't been a dramatic impact on the business as of yet.

但到目前為止，這還沒有對業務產生重大影響。

Great.

偉大的。

And as a follow up, one of my multi-part questions.

作為後續，我的多部分問題之一。

In the quarter, IoT solutions had a tremendous step up in terms of gross margins.

本季度，物聯網解決方案的毛利率大幅提升。

I'm wondering if you could dive into that a little bit.

我想知道你是否可以深入探討。

Is that sustainable?

這是可持續的嗎？

It sounds like a lot more improved profitability on the SmartSense front.

聽起來 SmartSense 方面的獲利能力有了很大提高。

I'm assuming there's less hardware in there, like as part of that Ventus was down in the quarter.

我假設那裡的硬體較少，就像 Ventus 在本季出現故障一樣。

I'm wondering what you could see from a visibility standpoint of the recovery, kind of what are the headwinds specifically on that front.

我想知道從復甦的可見性角度你能看到什麼，特別是在這方面的阻力是什麼。

And then on the other side of the table with products.

然後桌子的另一邊放著產品。

Console Server, I think you'd called out last quarter as being a little bit soft, some inventory in the channel.

控制台伺服器，我認為您在上個季度指出有點軟，渠道中有一些庫存。

I'm wondering if that is starting to rectify itself when we start to see a recovery of growth there and on the cellular products front.

我想知道當我們開始看到那裡和蜂窩產品的成長復甦時，這種情況是否開始自我糾正。

Thanks.

謝謝。

Yeah, thanks for the question, Scott.

是的，謝謝你的提問，斯科特。

Yes, I think you're picking up on a couple of really important trends.

是的，我認為您正在了解一些非常重要的趨勢。

One is, SmartSense's gross margins and the solutions gross margins, we do think that that's sustainable.

一是 SmartSense 的毛利率和解決方案的毛利率，我們確實認為這是可持續的。

It's showing the power of an ARR model for -- as a reminder, our solutions group is subscription only.

它展示了 ARR 模型的強大功能——提醒一下，我們的解決方案小組僅供訂閱。

We also are seeing some opportunities in SmartSense move to more of what we call an asset model or an OpEx model, where there isn't as much product or one-time revenue because that revenue is baked into a multiyear contract.

我們還看到 SmartSense 中的一些機會更多地轉向我們所說的資產模型或營運支出模型，其中沒有那麼多產品或一次性收入，因為該收入被納入多年合約中。

And for some customers that's their preferred way of doing business.

對於某些客戶來說，這是他們首選的開展業務的方式。

We don't force that model, but we do embrace it for those customers that want to pursue more of an OpEx model.

我們不會強制採用這種模式，但我們確實會為那些想要追求更多營運支出模式的客戶提供這種模式。

The Ventus situation, as I mentioned in an earlier question, we did see some pressure in 2023 from a particular financial services.

Ventus 的情況，正如我在先前的問題中提到的，我們確實在 2023 年看到了來自特定金融服務的一些壓力。

We all know about the regional bank crisis, that did have an impact on some ATM networks.

我們都知道地區銀行危機確實對一些 ATM 網路產生了影響。

We think really that's behind us.

我們認為這確實已經過去了。

And so as you look forward, we think Ventus has stabilized and now ready to grow.

因此，當你展望未來時，我們認為 Ventus 已經穩定下來，現在已經準備好成長。

So the last question on Console Server and Opengear.

最後一個問題是關於控制台伺服器和 Opengear 的。

I want to highlight that the team does an amazing job with their channel.

我想強調的是，該團隊的頻道做得非常出色。

And so Opengear and Console Server really does a nice job making sure the channel does not have too much inventory, and that has never really been a challenge for us.

因此，Opengear 和控制台伺服器確實做得很好，確保頻道沒有太多庫存，這對我們來說從來都不是真正的挑戰。

We highlighted a few major customers that had slowed their deployments and deferred some of their shipments to future quarters.

我們重點介紹了一些已放慢部署並將部分發貨推遲到未來幾季的主要客戶。

And these are a couple of larger customers.

這些是一些較大的客戶。

We didn't see a huge impact from those customers in the December quarter.

我們沒有看到這些客戶在 12 月季度產生巨大影響。

We do expect as the years go on -- sorry, the quarters go on, excuse me, that they will start to return based upon the communications we've had with them.

我們確實期望隨著時間的推移——抱歉，抱歉，這些季度還在繼續，對不起，他們將根據我們與他們的溝通開始回歸。

And so that will contribute positively.

這將產生積極的貢獻。

Opengear did grow quarter over quarter, even though we're still down year over year.

Opengear 確實實現了逐季成長，儘管我們仍同比下滑。

But it was down almost really exclusive on the back of what we would label as our strategic customers.

但在我們將其標記為策略客戶的背景下，它幾乎是排他性的。

Great.

偉大的。

Thanks, I'll get back in queue.

謝謝，我會回去排隊的。

Mike Walkley, Canaccord Genuity.

麥克沃克利 (Mike Walkley)，Canaccord Genuity。

Thanks for taking the question.

感謝您提出問題。

Nice to see the guidance's keep for the year.

很高興看到今年的指導方針。

Especially, with Qualcomm highlighting kind of excess inventory they're seeing the industrial IoT channel.

特別是，隨著高通強調庫存過剩，他們看到了工業物聯網通路。

Yeah, I guess, and Jamie, speaking to that inventory, you're working it down on your balance sheet.

是的，我想，傑米，談到該庫存，您正在將其記入資產負債表。

But how much do you think is still tied up in working capital in terms of excess inventory as you improve your cash flow versus where you think your inventory will be maybe exiting this year?

但是，當您改善現金流時，與您認為今年庫存可能退出的情況相比，您認為在過剩庫存方面仍有多少與營運資金相關？

Yeah, Mike, thanks for the question.

是的，麥克，謝謝你的提問。

I do think there's still dollars that are tied up in there.

我確實認為那裡仍然有美元。

Namely, part of the investment that we talked about last year that we made, was our ability to procure components where we were seeing shortages.

也就是說，我們去年談到的投資的一部分是我們採購短缺零件的能力。

And so really where a lot of that inventory relief will come from us as those components work themselves into finished goods.

因此，隨著這些組件自行轉化為成品，我們將減少大量庫存。

So I think it will be kind of a slower run off, because those components are obviously part of finished goods.

所以我認為這將是一種較慢的流失，因為這些組件顯然是成品的一部分。

And it'll take us -- I would say, reasonably the year to be able to work through those.

我想說，我們需要相當長的時間才能解決這些問題。

I think we saw a good step down here in the first quarter, you'll probably get something that's less of a straight line.

我認為我們在第一季看到了一個很好的進步，你可能會得到一些不那麼直線的東西。

And you could see a quarter where maybe it flattens out a little bit and then you take another step.

你可能會看到四分之一的地方可能會變平一點，然後你又邁出了一步。

Or maybe it's a couple of steps and then it flattens out a little bit and continues to step.

或者也許是幾步，然後它變得平坦一點並繼續前進。

But the real movement will come on that component side.

但真正的變化將出現在組件方面。

And I would say that that's something that we would look out over the next four quarters just continuing to work itself through.

我想說的是，我們將在接下來的四個季度中繼續關注這個問題，並繼續努力解決這個問題。

Yeah, to be even more specific.

是的，更具體地說。

We've got an excess of $30 million of components, and that's much higher than traditionally what we have.

我們擁有超過 3000 萬美元的零件，這比我們傳統上擁有的要高得多。

We have maybe $5 million, worst case $10 million component fees we last time buy.

我們上次購買的組件費用可能是 500 萬美元，最糟的情況是 1000 萬美元。

So there's $20 million to $25 million worth of inventory that we in normal times, we should not have or hold.

因此，我們在正常情況下不應該擁有或持有價值 2000 萬至 2500 萬美元的庫存。

But those will be worked off overtime.

但這些都將透過加班來解決。

Yeah, so there's a bit of an inventory dividend that we certainly expect to benefit from over the following quarters.

是的，所以我們肯定會在接下來的幾個季度中受益於一些庫存股息。

Great, that's helpful.

太好了，很有幫助。

And Ron, maybe just a follow-up question.

羅恩，也許只是一個後續問題。

You've been successful in integrating a lot of acquisitions to build out Digi to a solutions from a product -- point product company, as you highlighted in your script.

正如您在腳本中所強調的那樣，您已經成功地整合了大量收購，將 Digi 打造為產品解決方案——點產品公司。

But it seems like the capital structure now you're focused on paying down that debt.

但現在的資本結構似乎專注於償還債務。

But what you did is restructure the debt.

但你所做的是重組債務。

There is an option maybe to take on more debt given your strong adjusted EBITDA generation.

鑑於您的調整後 EBITDA 生成強勁，您可以選擇承擔更多債務。

So what's your view maybe in this capital market in terms of acquisitions?

那麼您對資本市場的收購有何看法？

And if you're still acquisitive, what are some of the areas you might be focused on to drive longer value for Digi shareholders?

如果您仍然有收購欲，您可能會關注哪些領域來為 Digi 股東帶來更長期的價值？

Yeah, thanks for the question.

是的，謝謝你的提問。

But the IoT market is just -- the industrial IoT is massive.

但物聯網市場是巨大的——工業物聯網是巨大的。

There's a ton of fragmentation opportunities, and we think Digi will continue to be a leader in both organically growing but also complementing that with select inorganic opportunities.

有大量的零碎機會，我們認為 Digi 將繼續成為有機成長的領導者，同時也透過精選的無機機會進行補充。

So we are still very active.

所以我們還是很活躍的。

We maintain a really strong funnel of opportunities out there, but we're also very patient as well.

我們保持著一個非常強大的機會管道，但我們也非常有耐心。

I can say we have certainly I think, more disciplines here as interest rates have risen and we've been looking to pay down our debt.

我可以說，我認為，隨著利率上升，我們當然有更多的紀律，而且我們一直在尋求償還債務。

And we really needed to bias our capital structure and especially in '22 and '23 towards inventory to service our customers.

我們確實需要調整我們的資本結構，特別是在 22 年和 23 年，偏向庫存以服務我們的客戶。

That is, you can see from this recent quarter and some of our comments that Jamie and I had.

也就是說，您可以從最近一個季度以及傑米和我的一些評論中看到。

We're really not needed to have that type of posture with inventory now we can move more strongly into paying down debt, giving us more capacity for the right opportunity.

我們確實不需要對庫存採取這種態度，現在我們可以更強有力地償還債務，從而為我們提供更多的能力來抓住合適的機會。

So we are working as hard as ever on sourcing and developing potential acquisition targets.

因此，我們一如既往地努力尋找和開發潛在的收購目標。

But I'd say again, we're still, I think, pretty disciplined on making sure it's the right opportunity, it's got the right value proposition, and Digi -- can help Digi succeed, but also improve our model.

但我想再說一遍，我認為，我們仍然非常自律，確保這是正確的機會，它有正確的價值主張，而 Digi 可以幫助 Digi 取得成功，同時也可以改進我們的模式。

In particular, we look at companies that have a significant amount of annualized recurring revenue, they're growing, they're profitable, and we have a right to partner with them.

我們特別關注那些擁有大量年化經常性收入、正在成長、獲利的公司，我們有權利與他們合作。

Great, thanks for taking my questions, I'll pass the line.

太好了，謝謝你回答我的問題，我會掛斷電話的。

Harsh Kumar, Piper Sandler.

嚴厲的庫馬爾，派珀桑德勒。

Yeah, hey guys, solid guide.

是的，嘿夥計們，可靠的指導。

All things considered, given the state of economy.

考慮到經濟狀況，考慮到所有因素。

And Ron, to that end, you maintained your full-year guide, as Mike pointed out.

羅恩，為此，正如邁克指出的那樣，您保留了全年指南。

If I look at your quarterly numbers, you should have started high about a year or so ago.

如果我看一下你們的季度數據，你們應該在大約一年前就開始走高。

And then you're maintaining your guide, which suggests you're expecting a pickup in the back half of the year.

然後你會維持你的指南，這表明你預計下半年會回升。

So with that tune, can I safely assume that the inventory correction that everybody was worried about particularly, you yourself and your business.

因此，透過這種調整，我可以放心地假設每個人都特別擔心的庫存調整，你自己和你的企業。

Is that correction coming to an end?

這次修正即將結束嗎？

And can we safely assume that we're close to the bottom of it?

我們可以放心地假設我們已經接近底部了嗎？

I think without a doubt, our annual guide assumes really sequential improvement in our performance over the fiscal year.

我認為毫無疑問，我們的年度指南假設我們在本財年的表現確實連續改善。

I think it's a combination of customers digesting and normalizing their demand and inventory levels.

我認為這是客戶消化和規範其需求和庫存水準的結合。

I think it's also in part driven by our previous comments we made around our Opengear teammates that we -- the strategics coming back in the second half of our fiscal year.

我認為這在一定程度上也是由我們先前對 Opengear 隊友發表的評論推動的，我們的策略將在本財年下半年回歸。

We see also, I think some of the comments from our solutions teammates that really are starting to now in a be much better position to grow.

我們也看到，我認為我們的解決方案團隊成員的一些評論確實現在開始處於更好的成長位置。

They've got some of the pruning that their customers, they're behind them.

他們對他們的客戶進行了一些修剪，他們支持他們。

So I think that combination of things has us feeling confident about our annual guide.

所以我認為，這些因素的結合讓我們對我們的年度指南充滿信心。

Great.

偉大的。

And then I think you were making a push or Digi was making a push to incorporate software into hardware sales.

然後我認為你們或 Digi 正在推動將軟體納入硬體銷售。

And I've seen a lot of other companies that make hardware do that at very profitable margins.

我見過很多其他製造硬體的公司都以非常高的利潤率做到這一點。

I was just curious if you could give us an update on how that's going.

我只是好奇你能否向我們介紹最新進展。

I certainly think that's the right way for you guys to go.

我當然認為這對你們來說是正確的選擇。

But I'll be curious on how things are going.

但我很好奇事情進展如何。

Yeah, thanks for the question.

是的，謝謝你的提問。

That is the number one priority, for this company is to progress from being more of a product-oriented company to solution-oriented company.

這是第一要務，因為這家公司要從以產品為導向的公司發展為以解決方案為導向的公司。

We're going to leverage our rich and long history in providing outstanding edge devices.

我們將利用我們豐富而悠久的歷史來提供出色的邊緣設備。

But increasingly, we're going to differentiate and satisfy our customers with software, both quite frankly on the device but also in the cloud and remote deployment.

但我們將越來越多地透過軟體來區分並滿足我們的客戶，坦白說，無論是在設備上，還是在雲端和遠端部署中。

So those things are going to be mega things that are going to last.

因此，這些事情將成為持久的重大事情。

And we're seeing customers and quite frankly, internally response.

坦白說，我們看到了客戶的內部反應。

I was at -- brief story, I was at CES this year and had an opportunity with one of our larger prospects.

我參加了——簡單來說，我今年參加了 CES，並有機會接觸到我們更大的潛在客戶之一。

And for the first time in my nine-year career, they asked me what the software subscription program was for the product.

在我九年的職業生涯中，他們第一次問我該產品的軟體訂閱計劃是什麼。

Which almost brought me to tears.

這幾乎讓我流淚。

But I think what's happening, the constant changes in security, regulation, technology, business opportunities, and challenges.

但我認為正在發生的事情，安全、監管、技術、商業機會和挑戰的不斷變化。

It is no longer set it and forget it.

它不再是設定它然後忘記它。

You'd have to actively manage your remote IoT solution and the things that is connected to.

您必須主動管理遠端物聯網解決方案以及所連接的事物。

And I think the market is really coming and embracing that context and providers that can help them on that journey.

我認為市場正在真正到來並接受能夠在這一過程中為他們提供幫助的環境和提供者。

Great stuff guys.

很棒的東西，夥計們。

I'll get back in queue.

我會回到隊列中。

Congratulations on maintaining full year guidance.

祝賀維持全年指引。

Seems like hitting the bottom.

看來要觸底了。

Anthony Stoss, Craig Hallum.

安東尼·斯托斯，克雷格·哈勒姆。

Good morning, guys, nice execution.

早上好，夥計們，執行得很好。

Ron, for you, I'm just curious if you're seeing any pricing pressures above what you'd normally expect in any of your business segments.

羅恩，對於您來說，我只是好奇您是否在任何業務部門中看到了超出您通常預期的定價壓力。

I'm curious, which is better, and which is worse.

我很好奇，哪個比較好，哪個比較差。

And then maybe for Jamie, can you give us a view?

那麼傑米，你能給我們一個看法嗎？

Do you expect gross margins to be stable for the rest of the fiscal year?

您預計本財年剩餘時間的毛利率會維持穩定嗎？

Hey Tony, good morning.

嘿托尼，早安。

We're not seeing really price pressures.

我們沒有看到真正的價格壓力。

I would say price increases have certainly moderated from COVID era, where it's really tough to get inventory.

我想說，從新冠疫情時代以來，價格上漲肯定已經放緩，因為在新冠疫情時代，庫存確實很難取得。

Quite frankly, we see more conversations around terms in price.

坦白說，我們看到更多圍繞價格條款的對話。

People are looking to have more discussions on MSAs and things like that.

人們希望就 MSA 之類的事情進行更多討論。

But price I would say, gone are the base of necessarily rapid price increases, but not necessarily price decreases either.

但價格方面，我想說的是，價格必然快速上漲的基礎已經消失，但價格也不一定會下降。

Yeah Tony, I think on the gross margin side, we certainly think that the gross margins will be stable.

是的，托尼，我認為在毛利率方面，我們當然認為毛利率將會穩定。

In fact, I think we're running on multi quarters now, kind of that 10, 15, 20 basis point improvement sequentially.

事實上，我認為我們現在正在多個季度運行，依次提高了 10、15、20 個基點。

And I think we'll continue to see gross margins stay at or even continue to click up by basis points here for the remainder of

我認為，在剩下的時間裡，我們將繼續看到毛利率保持不變，甚至繼續增加基點。

--

--

Yeah, the dynamic there Tony, is really ARR.

是的，托尼那裡的活力確實是 ARR。

And we've been very prominent that ARR will grow faster than our top line.

我們非常清楚，ARR 的成長速度將超過我們的營收成長速度。

We'd like to leave with ARR as the first metric because it's so indicative of our journey to be a solutions provider.

我們希望將 ARR 作為第一個指標，因為它非常能體現我們成為解決方案提供者的歷程。

It has higher gross margins than our product gross margins.

它的毛利率高於我們產品的毛利率。

And it really, with good operational discipline leads to higher, both gross and EBITDA margins.

事實上，良好的營運紀律可以帶來更高的毛利率和 EBITDA 利潤率。

And so that's been our mantra.

這就是我們的座右銘。

We're not going to be perfect, but that's the trend.

我們不會做到完美，但這就是趨勢。

And I think to Jamie's point, we've exhibited that, especially in the recent quarters.

我認為就傑米的觀點而言，我們已經展示了這一點，尤其是在最近幾季。

Got it. one quick follow-up.

知道了。快速跟進。

A couple of quarters ago Ron, you're talking about deals taking longer to close.

幾個季度前，羅恩，你談論的是交易需要更長的時間才能完成。

Is that now generally behind us or is still kind of with us?

現在這種情況已經過去了還是仍然存在？

I would say it's improved a little bit, but I wouldn't say it's back to the way things used to be.

我會說它有所改善，但我不會說它又回到了以前的樣子。

I think people are still pretty exacting.

我覺得人們還是比較挑剔的。

And you're seeing this from a lot of companies that are being rewarded for cost control, whether that's in the form of personnel or other expenses.

你可以從許多因成本控製而獲得獎勵的公司中看到這一點，無論是人員費用還是其他費用。

So we have to -- I would say we have to work harder to earn the business.

所以我們必須——我想說，我們必須更加努力才能贏得業務。

The business is there, but you do have to put more time.

生意是有的，但你確實需要投入更多的時間。

You're going to have to be working more as a team as well, getting help from your teammates, and finance and legal, to make sure those large opportunities make it through the final stages.

您還必須更多地作為一個團隊工作，從隊友、財務和法律方面獲得幫助，以確保這些巨大的機會能夠度過最後階段。

But I do think we will return to a more assertive posture.

但我確實認為我們將恢復更自信的姿態。

Right now, I'd still say it's taking a little bit longer than traditionally for opportunities to close.

現在，我仍然想說，機會比傳統情況下需要更長的時間才能結束。

Very good, guys.

非常好，夥計們。

Thank you.

謝謝。

And thank you.

謝謝你。

And I am showing no further questions.

我沒有提出任何進一步的問題。

I would now like to turn the call back over to Ron Konezny for closing remarks.

現在我想將電話轉回 Ron Konezny 致閉幕詞。

We appreciate everyone joining earnings -- our earnings call today.

我們感謝大家加入我們今天的財報電話會議。

And for your continued support, a huge and heartfelt thank you to our customers, distributors, suppliers, and of course, to the Digi team.

對於您持續的支持，我們向我們的客戶、經銷商、供應商，當然還有 Digi 團隊表示衷心的感謝。

Have a great day.

祝你有美好的一天。

This concludes today's conference call.

今天的電話會議到此結束。

Thank you for participating.

感謝您的參與。

You may now disconnect.

您現在可以斷開連線。