Data Storage Corp (DTST) 2022 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Data Storage Corporation third-quarter 2022 conference call. (Operator Instructions)

女士們先生們，美好的一天，歡迎來到 Data Storage Corporation 2022 年第三季度電話會議。 （操作員說明）

It is now my pleasure to turn the floor over to your host, Alexandra Schilt. Ma'am, the floor is yours.

現在我很高興將發言權交給主持人 Alexandra Schilt。女士，地板是你的。

Thank you. Good morning, everyone, and welcome to Data Storage Corporation's 2022 third quarter ended September 30, 2022, business update conference call. On the call with us this morning are Chuck Piluso, Chairman and Chief Executive Officer; and Chris Panagiotakos, Chief Financial Officer. The company issued a press release this morning containing third-quarter 2022 financial results, which is also posted on the company's website. If you have any questions after the call or would like any additional information about the company, please contact Crescendo Communications at (212) 671-1020.

謝謝。大家早上好，歡迎來到 Data Storage Corporation 截至 2022 年 9 月 30 日的 2022 年第三季度業務更新電話會議。今天上午與我們通話的有董事長兼首席執行官 Chuck Piluso；首席財務官 Chris Panagiotakos。該公司今天上午發布了一份包含 2022 年第三季度財務業績的新聞稿，該新聞稿也發佈在公司網站上。如果您在通話後有任何疑問或想了解有關公司的任何其他信息，請致電 (212) 671-1020 聯繫 Crescendo Communications。

Before we begin, I'd like to remind listeners that this conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as amended that are intended to be covered by the Safe Harbor created thereby. Forward-looking statements are subject to risks and uncertainties that could cause actual results, performance, or achievements to differ materially from any future results, performance, or achievements expressed or implied by such forward-looking statements.

在我們開始之前，我想提醒聽眾，本次電話會議包含經修訂的 1995 年《私人證券訴訟改革法案》含義內的前瞻性陳述，這些陳述旨在涵蓋由此創建的安全港。前瞻性陳述受到風險和不確定性的影響，這些風險和不確定性可能導致實際結果、業績或成就與此類前瞻性陳述明示或暗示的任何未來結果、業績或成就存在重大差異。

Statements preceded by, followed by or that otherwise include the words believes, expects, anticipates, estimates, plans, and similar expressions or future or conditional verbs such as will, should, would, may, and could, are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Although the company believes that the expectations reflected in such forward-looking statements are reasonable, it can provide no assurance that such expectations will prove to have been correct.

之前、之後或以其他方式包括相信、期望、預期、估計、計劃和類似表達或將來或條件動詞（例如 will、should、would、may 和 could）的陳述通常具有前瞻性而不是歷史事實，儘管並非所有前瞻性陳述都包括上述內容。儘管公司認為此類前瞻性陳述中反映的預期是合理的，但無法保證此類預期將被證明是正確的。

Important factors that could cause actual results to differ materially from the company's expectations include, but are not limited to, the company's ability to leverage the scalability and performance of flagship solutions, the company's ability to benefit from the IBM Cloud migration underway, the company's ability to position itself for future profitability, and the company's ability to maintain its NASDAQ listing. These risks should not be construed as exhaustive and should be read together with other cautionary statements included in the company's quarterly report on Form 10-Q for the quarter ended September 30, 2022, and annual reports on Form 10-K and current reports on Form 8-K filed with the Securities and Exchange Commission.

可能導致實際結果與公司預期存在重大差異的重要因素包括但不限於公司利用旗艦解決方案的可擴展性和性能的能力、公司從正在進行的 IBM Cloud 遷移中受益的能力、公司的能力為未來的盈利能力以及公司維持其在納斯達克上市的能力定位自己。這些風險不應被解釋為詳盡無遺，應與公司截至 2022 年 9 月 30 日的季度 10-Q 表季度報告以及 10-K 表年度報告和當前報告中包含的其他警示性聲明一起閱讀向美國證券交易委員會提交的 8-K 文件。

Any forward-looking statement speaks only as of the date on which it was initially made. Except as required by law, the company assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances, or otherwise.

任何前瞻性陳述僅在最初發表之日有效。除非法律要求，否則公司不承擔更新或修改任何前瞻性陳述的義務，無論是由於新信息、未來事件、情況變化或其他原因。

I'd now like to turn the call over to Chuck Piluso. Please go ahead, Chuck.

我現在想把電話轉給 Chuck Piluso。請繼續，查克。

Thanks, Ale, and good morning, everyone. We continue to witness strong revenue growth, evidenced by achieving revenue of $4.4 million for the third quarter ending September 30, 2022. This represents a 14% increase compared to the same period last year.

謝謝，Ale，大家早上好。我們繼續見證強勁的收入增長，截至 2022 年 9 月 30 日的第三季度實現收入 440 萬美元就是證明。這比去年同期增長了 14%。

Notably, our revenue for the nine months ending September 30, 2022, increased 80% over the same period last year, reaching $17.9 million. Our decades of experience providing an array of multi-cloud technology solutions, properly allocated investments, and highly skilled employees are the foundation to our success that has allowed us to firmly position ourselves as a leader within the industry.

值得注意的是，截至 2022 年 9 月 30 日的九個月，我們的收入比去年同期增長了 80%，達到 1790 萬美元。我們在提供一系列多雲技術解決方案、適當分配的投資和高技能員工方面數十年的經驗是我們成功的基礎，使我們能夠堅定地將自己定位為行業領導者。

I'd like to note that we provide solutions to a multibillion-dollar marketplace. In fact, according to Fortune Business Insights, the cloud-managed service industry in North America was $16.3 billion in 2019 and has been growing at a rate of 13.8% compounded annual growth rate, bringing the number to $24 billion by the end of 2022.

我想指出，我們為價值數十億美元的市場提供解決方案。事實上，根據 Fortune Business Insights 的數據，2019 年北美的雲託管服務行業規模為 163 億美元，並一直以 13.8% 的複合年增長率增長，到 2022 年底這一數字將達到 240 億美元。

Disaster recovery is projected to be at $3.6 billion in the US by the end of 2022, which represents 35% of the overall 10.3 global marketplace based on Grandview Research Disaster Recovery Solutions market size report.

根據 Grandview Research 災難恢復解決方案市場規模報告，到 2022 年底，美國的災難恢復預計將達到 36 億美元，佔全球 10.3 整體市場的 35%。

Our Nexxis solutions fit well, with our dedicated Internet access, are critical component to access cloud services. Further, the steadily growing VoIP market is expected to reach $90 billion worldwide in 2022, with a compounded annual growth rate of 3.1% with $17 billion in the US according to Global Newswire market analysis and insights.

我們的 Nexxis 解決方案非常適合我們的專用互聯網訪問，是訪問云服務的關鍵組件。此外，根據 Global Newswire 市場分析和洞察，穩步增長的 VoIP 市場預計到 2022 年全球將達到 900 億美元，複合年增長率為 3.1%，其中美國為 170 億美元。

Our goal is to aggressively penetrate these markets while executing on our strategy of securing high-margin, recurring subscription-based and managed service contracts. As we see more companies migrating their IBM power infrastructure to the cloud, we believe this propels our solutions to the forefront of the industry, providing us the potential to capitalize on these growing multibillion-dollar markets. We see this migration underway as the future of our industry, and we are well positioned to take advantage of these opportunities.

我們的目標是積極滲透這些市場，同時執行我們確保高利潤、經常性訂閱和託管服務合同的戰略。隨著我們看到越來越多的公司將他們的 IBM 電力基礎設施遷移到雲端，我們相信這將推動我們的解決方案走在行業的前沿，為我們提供利用這些不斷增長的數十億美元市場的潛力。我們將這種正在進行的遷移視為我們行業的未來，我們已準備好利用這些機會。

Given the migration to the cloud within the IBM market that I've been discussing over the past few conference calls, currently, only 15% of the IBM Power Service are utilizing the cloud today despite over 1 million virtual IBM Power Service globally. With limited competition in the market, we have the platform and the talent to capture the migration opportunities in front of us.

考慮到我在過去幾次電話會議上一直在討論的 IBM 市場向雲的遷移，目前，儘管全球有超過 100 萬個虛擬 IBM Power 服務，但目前只有 15% 的 IBM Power 服務在使用雲。在市場競爭有限的情況下，我們有平台和人才來抓住我們面前的遷移機會。

The company has invested millions of dollars in six Tier 3 data centers in the US and Canada. The equipment and technical teams build our solutions. This is not an IBM reseller arrangement. We have the employees overseeing the services and operate our own equipment, cages, and racks in the data centers. Today, we service over 350 companies.

該公司已在美國和加拿大的六個三級數據中心投資了數百萬美元。設備和技術團隊構建我們的解決方案。這不是 IBM 經銷商安排。我們有員工監督服務並在數據中心操作我們自己的設備、籠子和機架。今天，我們為 350 多家公司提供服務。

We compete with just four or five companies that have this expertise, helping companies looking to migrate to the cloud. And yet I believe we do a better job, less painful, more efficiently, and cross competitively. Our company is a leader in this industry.

我們僅與四五家擁有這種專業知識的公司競爭，幫助希望遷移到雲的公司。然而我相信我們做得更好，痛苦更少，效率更高，並且具有交叉競爭性。我們公司是這個行業的領導者。

I would also like to reiterate that the businesses that are increasingly under pressure to improve the effectiveness and efficiency of the information and storage systems, whereby accelerating the migration from self-managed technical equipment and solutions to fully managed multi-cloud technologies to reduce cost and compete effectively.

我還想重申，越來越多的企業面臨著提高信息和存儲系統的有效性和效率的壓力，從而加速從自我管理的技術設備和解決方案向完全管理的多雲技術的遷移，以降低成本和有效競爭。

Additionally, in today's environment, capital preservation is an encouragement to move from a capital-intensive, on-premise technology to a pay-as-you-grow CapEx to OpEx model. These trends create an opportunity for cloud technology service providers and demand for fully managed cloud and cybersecurity services across major operating systems, an addressable market of approximately $48 billion in annual recurring revenue in the US and Canada.

此外，在當今環境中，資本保全鼓勵從資本密集型內部部署技術轉變為按需增長的資本支出到運營支出模式。這些趨勢為雲技術服務提供商創造了機會，並產生了對跨主要操作系統的完全託管雲和網絡安全服務的需求，這是一個在美國和加拿大每年約有 480 億美元經常性收入的潛在市場。

Demonstrating our commitment to security, we achieved ISO certification for our CloudFirst and Nexxis divisions. This third-party certification validates our extensive internal protocols and security measures that ensure our customers' data and information has been addressed, implemented, properly controlled in all areas of our organization.

為了證明我們對安全的承諾，我們的 CloudFirst 和 Nexxis 部門獲得了 ISO 認證。這種第三方認證驗證了我們廣泛的內部協議和安全措施，確保我們客戶的數據和信息在我們組織的所有領域得到處理、實施和適當控制。

We believe this certification will also assist us in accelerating our customer adoption due to the fact many organizations seek this certification prior to implementing certain solutions. We remain committed to adhering to the highest level of security standards for our company and for the trusted support of our clients.

我們相信，由於許多組織在實施某些解決方案之前尋求此認證，因此我們相信此認證還將幫助我們加速客戶採用。我們始終致力於為我們的公司遵守最高級別的安全標準，並為我們的客戶提供可信賴的支持。

Importantly, we are undertaking activities that we anticipate will further improve our margins and profitability as well as accelerate our growth. This includes realigning management and operations. We have recently centralized service delivery and infrastructure. Our sales engineering teams now can better utilize our client proposal tools and software across combined sales teams.

重要的是，我們正在進行的活動預計將進一步提高我們的利潤率和盈利能力，並加速我們的增長。這包括重新調整管理和運營。我們最近集中了服務交付和基礎設施。我們的銷售工程團隊現在可以在合併後的銷售團隊中更好地利用我們的客戶提案工具和軟件。

Additionally, we are establishing a new major accounts team that will be responsible for supporting our large enterprise-level clients as well as continuing satisfying ongoing equipment, software, and IT requirements.

此外，我們正在建立一個新的大客戶團隊，負責支持我們的大型企業級客戶，並繼續滿足持續的設備、軟件和 IT 需求。

We believe the changes stated will significantly improve our infrastructure solutions and recurring revenue to one-time sales ratio and as a result, will enhance gross profit and margins. At the same time, we plan on expanding our international programs and strengthen our established and successful US sales and marketing programs.

我們相信，上述變化將顯著改善我們的基礎設施解決方案和經常性收入與一次性銷售額的比率，從而提高毛利和利潤率。與此同時，我們計劃擴大我們的國際項目並加強我們已建立且成功的美國銷售和營銷項目。

To streamline our operations, we are reducing redundant operating expenses within the organizations. We have realigned our management team to further increase our profitability.

為了簡化我們的運營，我們正在減少組織內的冗餘運營費用。我們重新調整了我們的管理團隊，以進一步提高我們的盈利能力。

I am also pleased to report that we achieved positive adjusted EBITDA for the third quarter of 2022 and believe our initiatives that I have laid out will advance us towards increased profitability and improve margins.

我也很高興地報告，我們在 2022 年第三季度實現了積極的調整後 EBITDA，並且相信我提出的舉措將推動我們提高盈利能力並提高利潤率。

On a final note, we have a strong team, a robust proposal pipeline, and limited competition. With over $11 million in cash in the bank, we are well funded, well positioned to execute on our growth strategy, improve our margins, increase profitability, all while maintaining leadership position in the industry.

最後一點，我們擁有一支強大的團隊、強大的提案管道和有限的競爭。憑藉超過 1100 萬美元的銀行現金，我們資金充足，能夠很好地執行我們的增長戰略，提高我們的利潤率，增加盈利能力，同時保持行業領先地位。

With that, I'd like to turn it over to Chris, our CFO, to discuss our third quarter financials. Please go ahead, Chris.

有了這個，我想把它交給我們的首席財務官克里斯來討論我們第三季度的財務狀況。請繼續，克里斯。

Thank you, Chuck. Total revenue for the three months ended September 30, 2022, was $4.4 million, an increase of approximately $600,000 or 14% compared to $3.9 million for the three months ended September 30, 2021. The increase is primarily attributed to the increase of equipment and software sales. This was offset by a slight decrease in managed services for the three months ended September 30, 2022.

謝謝你，查克。截至 2022 年 9 月 30 日止三個月的總收入為 440 萬美元，與截至 2021 年 9 月 30 日止三個月的 390 萬美元相比增加了約 600,000 美元或 14%。增加的主要原因是設備和軟件的增加銷售量。這被截至 2022 年 9 月 30 日止三個月的託管服務略有下降所抵消。

Cost of sales for the three months ended September 30, 2022, was $2.6 million, an increase of approximately $250,000 or 11% compared to $2.3 million for the three months ended September 30, 2021. The increase was mostly related to the increase in revenue.

截至 2022 年 9 月 30 日止三個月的銷售成本為 260 萬美元，與截至 2021 年 9 月 30 日止三個月的 230 萬美元相比增加了約 250,000 美元或 11%。增加主要與收入增加有關。

Selling, general and administrative expenses for the three months ended September 30, 2022, were $2.1 million, an increase of approximately $200,000 or 11% as compared to $1.9 million for the three months ended September 30, 2021. The increase is primarily attributed to the increase in salaries as a result of new sales and marketing staff and increased marketing expenses.

截至 2022 年 9 月 30 日止三個月的銷售、一般和行政費用為 210 萬美元，與截至 2021 年 9 月 30 日止三個月的 190 萬美元相比增加了約 200,000 美元或 11%。增加的主要原因是由於新的銷售和營銷人員的增加以及營銷費用的增加，工資有所增加。

Adjusted EBITDA for the quarter was $162,390 compared to adjusted EBITDA of $104,985 for the same period last year.

本季度調整後的 EBITDA 為 162,390 美元，而去年同期調整後的 EBITDA 為 104,985 美元。

Net loss attributable to common shareholders for the three months ended September 30, 2022, was $245,619 compared to net income of $135,630 for the same period in 2021.

截至 2022 年 9 月 30 日止三個月，歸屬於普通股股東的淨虧損為 245,619 美元，而 2021 年同期的淨收入為 135,630 美元。

We ended the quarter with cash and cash equivalents of $11.3 million as of September 30, 2022, compared to $12.1 million at December 31, 2021.

截至 2022 年 9 月 30 日，我們在本季度末的現金和現金等價物為 1,130 萬美元，而 2021 年 12 月 31 日為 1,210 萬美元。

Thank you. I will now turn the call back to Chuck.

謝謝。我現在將把電話轉回給查克。

Thanks, Chris. I'd like to open it up right now for some Q&A. Any questions that we may have?

謝謝，克里斯。我想現在打開它進行一些問答。我們有什麼問題嗎？

(Operator Instructions) Matthew Galinko, Maxim Group.

（操作員說明）Maxim Group 的 Matthew Galinko。

Hey, good morning. Thanks for taking my questions. Can you start off with what the pipeline today looks like for SaaS recovery in cloud infrastructure looking forward?

嗨，早上好。感謝您回答我的問題。您能否從展望未來的雲基礎設施中 SaaS 恢復的今天管道情況開始？

Matt, yes, I can go in more detail on that. We have around approximately $20 million in the sales funnel. And so when we look at the sales funnel, we look at it as total contract value. So there's approximately $6 million or so in one-time charges. That could be IT services, equipment, and software, and approximately $14 million total contract value.

馬特，是的，我可以詳細介紹一下。我們的銷售渠道大約有 2000 萬美元。因此，當我們查看銷售漏斗時，我們將其視為總合同價值。因此，一次性費用約為 600 萬美元左右。這可能是 IT 服務、設備和軟件，總合同價值約為 1400 萬美元。

And if you remember that previous calls, I revealed that we usually get a 36-month term contract. It can be sometimes 12 and as high as 60 months. But I would say, on average, 36 months. So if the number that occurs the most, the mode is $3,000 a month. That's how we'll come up with that $14 million in sales proposals. So a quick number is to kind of divide that by 36 and you'll see what we're working with.

如果你還記得之前的電話，我透露我們通常會簽訂 36 個月的定期合同。有時可能是 12 個月，最長可達 60 個月。但我會說，平均而言，36 個月。因此，如果出現次數最多，眾數就是每月 3,000 美元。這就是我們提出 1400 萬美元銷售建議的方式。所以一個快速的數字就是將它除以 36，你會看到我們正在處理什麼。

But usually, we try to keep it around that level. Most of the times, we won't lose. There's very few competitors. In most cases, people are asking for proposals and quotes, and then what ends up happening is they're not ready to do it yet but are gathering budgetaries. So actually, in our sales force, we rated where we're from a quote to negotiation of an agreement to a win.

但通常，我們會盡量將其保持在該水平附近。大多數時候，我們不會輸。競爭對手很少。在大多數情況下，人們是在徵求建議和報價，然後最終發生的是他們還沒有準備好去做，而是在收集預算。所以實際上，在我們的銷售團隊中，我們對從報價到協議談判再到勝利的過程進行了評估。

So overall, the proposals outstanding today are $14 million in total subscription recurring.

因此，總的來說，今天未完成的提案的經常性認購總額為 1400 萬美元。

Got it. Thank you. And I guess the follow-up to that is, are you seeing any changes to customer behavior in terms of how they structure deals, how they approach cloud versus premise as we've seen the capital market environment change and the macro environment change?

知道了。謝謝。我想接下來的事情是，當我們看到資本市場環境發生變化和宏觀環境發生變化時，您是否看到客戶行為在他們如何構建交易、他們如何處理雲與前提方面有任何變化？

We've seen larger deals come in actually. It's -- you'll see some deals that come in that might be 1,000, but we're seeing deals that could range from $12,000 to $18,000 in monthly recurring revenue that are being proposed. I don't want to go through too much detail on that, but we are seeing an uptick.

實際上，我們已經看到了更大的交易。它是 - 你會看到一些可能達到 1,000 筆的交易，但我們看到提議的每月經常性收入可能在 12,000 美元到 18,000 美元之間。我不想詳細說明這一點，但我們看到了增長。

We had approximately 6,000 or so organic searches off of our CloudFirst division, and it resulted in 100 leads that are being worked by the sales organization. So that's looking -- at this point, what we need to do is increase that by -- we're in the process of hiring salespeople.

我們從 CloudFirst 部門進行了大約 6,000 次左右的有機搜索，結果產生了 100 條銷售線索，這些線索正在由銷售組織處理。所以這就是——在這一點上，我們需要做的是增加——我們正在招聘銷售人員。

But just from the lead flow, it's pretty effective to be able to get leads and work those leads and convert into proposals and sales. So the actual numbers as it relates to the economy, I think people are questioning whether they should refresh their equipment on-premise versus go with a company like ours.

但僅僅從潛在客戶流中，能夠獲得潛在客戶並處理這些潛在客戶並將其轉化為提案和銷售是非常有效的。因此，與經濟相關的實際數字，我認為人們正在質疑他們是否應該在內部更新設備，而不是與像我們這樣的公司合作。

Remember, keep in mind, these systems, we don't compete with AWS, Google, or Microsoft. These systems on the operating system, some of them have the actual tools where the applications have been custom developed. So there wasn't a solution so fast for them before. They may have migrated all their intel over already.

記住，記住，這些系統，我們不與 AWS、谷歌或微軟競爭。操作系統上的這些系統，其中一些具有自定義開發應用程序的實際工具。所以他們以前沒有這麼快的解決方案。他們可能已經遷移了所有的情報。

So now we're seeing, I think, this uptick and this lead flow coming on because they realize the cloud is secure possibly where ISO and is seeing that and feeling comfortable. And I believe that they're evaluating whether they should go put the money to a piece of equipment and for -- and everything that goes along with that with the staff launching that equipment and managing it and doing the backups versus coming to us where I believe we do a better job at disaster recovery than someone that's doing in off-premise. Unless you're talking about Citibank, Deutsche Bank, and firms like that, they do fantastic jobs.

所以現在我們看到，我認為，這種上升和這種領先流動正在發生，因為他們意識到雲可能在 ISO 所在的地方是安全的，並且看到了這一點並感到舒服。而且我相信他們正在評估他們是否應該把錢花在一件設備上以及 - 以及隨之而來的一切，包括員工啟動該設備並管理它並進行備份而不是來我這裡相信我們在災難恢復方面比在外部部署的人做得更好。除非你談論的是花旗銀行、德意志銀行和類似的公司，否則它們的工作非常出色。

But for that mid-range customer, we do an unbelievable job for them for disaster recovery, cybersecurity, and they don't have to spend the money. We charge an implementation fee that's kind of very reasonable, and we keep them. We have a 94% renewal rate. So we're doing something right with that.

但對於中檔客戶，我們在災難恢復、網絡安全方面為他們做了令人難以置信的工作，而且他們不必花錢。我們收取非常合理的實施費，我們會保留這些費用。我們有 94% 的續訂率。所以我們正在做正確的事情。

Thanks. And one more for me before I jump back in the queue, and I probably have more after that, but I don't want to hog the line. I guess with respect to the funnel for cloud deals, and you mentioned the -- I guess, the funnel and the leads that you're generating. How confident are you that you're canvassing and finding customers when they're getting to that decision point of, hey, do we migrate to cloud or do we do another premise purchase? Do you feel like you're touching all of the cloud opportunities and migration opportunities there are in IBM Power? Or do you feel like there's more you can be doing to further expand that net?

謝謝。在我跳回隊列之前再給我一個，之後我可能還有更多，但我不想佔線。我想關於雲交易的渠道，你提到了——我想，你正在生成的渠道和潛在客戶。當客戶到達決策點時，您對您正在拉票和尋找客戶有多大信心，嘿，我們是遷移到雲還是進行另一次內部購買？您是否覺得自己正在觸及 IBM Power 中的所有云機會和遷移機會？還是您覺得可以做更多的事情來進一步擴大該網絡？

I'm -- frankly, I'm never happy, and it's never enough. It's just my personality, Matt, and I know you follow us and write about us. I will say that we're not doing enough. I think there's tremendous opportunity out there. Cable companies today, the only service they're eventually going to end up with is the Internet. And with that Internet, they're looking for increased revenue per customer for businesses like hospitals, financial firms, and all businesses they serve. So there's tremendous opportunity, I think, still to increase, and we're only touching on it. We're in the process of hiring some folks.

我——坦率地說，我從來都不快樂，而且這還不夠。這只是我的個性，馬特，我知道你關注我們並寫下我們。我會說我們做得還不夠。我認為那裡有巨大的機會。今天的有線電視公司，他們最終要提供的唯一服務就是互聯網。通過互聯網，他們正在為醫院、金融公司和他們所服務的所有企業尋求增加每位客戶的收入。因此，我認為仍有巨大的機會增加，而我們只是觸及它。我們正在招聘一些人。

The people that we are hiring though and where we're getting most of our business today other than the lead flow is we work with managed service providers that have sold that equipment and that they know us, the managed service provider is the trusted adviser for that client. They typically have multiple clients because they have a business.

我們正在招聘的人員以及我們今天獲得大部分業務的地方，除了潛在客戶外，我們與已銷售該設備並且他們了解我們的託管服務提供商合作，託管服務提供商是值得信賴的顧問那個客戶。他們通常有多個客戶，因為他們有業務。

And then with that, when the client is ready to look at it, the MSPs are prepared, folks that we call channel partners that have been trained by us, have the marketing materials from us and with us. We do joint calls with us or our sales engineering group and our sales teams.

然後，當客戶準備好查看它時，MSP 就準備好了，我們稱之為渠道合作夥伴的人已經接受了我們的培訓，他們從我們這裡得到了營銷材料。我們與我們或我們的銷售工程團隊和我們的銷售團隊進行聯合通話。

But is it enough? It's never enough. We -- but we are deploying that capital, the $11 billion. We are deploying that so that we can increase our sales organization and also reach into Canada as well on that.

但這就夠了嗎？永遠不夠。我們——但我們正在部署這筆資金，即 110 億美元。我們正在部署它，以便我們可以增加我們的銷售組織，並以此為基礎進入加拿大。

Recently, our partner, Able One, in Canada was acquired by Quadbridge, which is a much larger organization. We met with them during -- in Oktoberfest. We were invited up, and they're having all of their folks trained on our services. So that will increase our reach plus other plans we have in Canada, but we're not doing enough, frankly.

最近，我們在加拿大的合作夥伴 Able One 被 Quadbridge 收購，這是一個更大的組織。我們在慕尼黑啤酒節期間與他們會面。我們被邀請了，他們正在讓他們所有的人接受我們服務的培訓。因此，這將增加我們的影響力以及我們在加拿大的其他計劃，但坦率地說，我們做得還不夠。

There's just a lot more to touch on. And we have to get it to the point where it's not just the folks that sold the equipment, but companies like a cable company that has these customers and they can go out and layer our services onto their Internet.

還有很多東西要觸及。我們必須做到這一點，不僅僅是銷售設備的人，還有像有線電視公司這樣擁有這些客戶的公司，他們可以走出去，將我們的服務分層到他們的互聯網上。

I don't know if that answers it, but the answer is we're never going to do enough. It's just a personality thing for me.

我不知道這是否能解決問題，但答案是我們永遠都做得不夠。對我來說這只是個性問題。

Your next question for today is coming from [Elon Friedman at FKC Capital].

您今天的下一個問題來自 [FKC Capital 的 Elon Friedman]。

How do you anticipate improving your margins, especially as it relates to Flagship?

您預計如何提高利潤率，尤其是與旗艦產品相關的利潤率？

Sure. Flagship primarily, they have relationships with IBM and a few other larger providers, the margins were small. Leads would come in or do come in from IBM, HCL, Red Hat, and organizations like that. And these clients would get entertained that they bring in to those services, which are typically at 20% to 35% margin on that. So we're redirecting all of the events.

當然。主要是旗艦，他們與 IBM 和其他一些較大的供應商有關係，利潤很小。潛在客戶可能來自或確實來自 IBM、HCL、Red Hat 和類似的組織。這些客戶會因為他們帶來這些服務而感到高興，這些服務通常有 20% 到 35% 的利潤率。所以我們正在重定向所有事件。

And Flagship has had -- they have a great Director of Marketing and has done a fantastic job with many events throughout the United States over the 15 months since we purchased Flagship. So we're working with Director of Marketing and moving that -- some of those events more towards not introducing IBM's cloud. But now our cloud, our infrastructure, our disaster recovery.

自從我們購買 Flagship 以來的 15 個月裡，Flagship 擁有一位出色的營銷總監，並且在美國各地的許多活動中做得非常出色。因此，我們正在與營銷總監合作，並推動其中一些活動更傾向於不引入 IBM 的雲。但現在是我們的雲、我們的基礎設施、我們的災難恢復。

So that movement of 20% to 25%, and it could be higher at 35%. We're hoping to see more of the 50% margin products introduced to the folks that are attending these events. So it is part of our marketing plans that we're putting in place for 2023. So I would say that's one way of improving margins.

所以 20% 到 25% 的運動，它可能會更高，達到 35%。我們希望看到更多的 50% 保證金產品介紹給參加這些活動的人們。因此，這是我們為 2023 年制定的營銷計劃的一部分。所以我想說這是提高利潤率的一種方式。

Also, Flagship has a data center in Miami. Chuck Paolillo, our CTO, along with great staff at Flagship and also CloudFirst are going to be migrating that data center to 1 of the 6 Tier 3 data centers we have throughout the United States, with the 4 in the United States.

此外，Flagship 在邁阿密設有數據中心。我們的首席技術官 Chuck Paolillo 以及 Flagship 和 CloudFirst 的優秀員工將將該數據中心遷移到我們在美國擁有的 6 個三級數據中心中的一個，其中 4 個在美國。

And we've also centralized operations between Flagship and between CloudFirst and under Chuck Paolillo, the CTO. And with that, we believe that let's not go add someone so fast to it. Let's see what the talents are in the organization to be able to see who can cover that, and we're uncovering some of those things today.

我們還在 Flagship 和 CloudFirst 之間以及 CTO Chuck Paolillo 的領導下集中運營。有了這個，我們相信我們不要這麼快地添加人。讓我們看看組織中的人才是什麼，以便能夠看到誰可以做到這一點，我們今天正在揭開其中的一些東西。

Although we need to add, if we're going to continue to grow, we need to operate -- we call service delivery and infrastructure, we'll need to add to that. But right now, the situation is Flagship could be using some contractors and looking at those numbers, Chuck Paolillo will see whether we should hire an employee that's more cost-effective.

雖然我們需要添加，但如果我們要繼續增長，我們需要運營——我們稱之為服務交付和基礎設施，我們需要添加。但現在，Flagship 可能正在使用一些承包商並查看這些數字，Chuck Paolillo 將看看我們是否應該僱用更具成本效益的員工。

So I would say on centralizing operations, Miami data center, and moving these marketing events to not say that we're selling IBM's cloud, but selling our own cloud where we have millions of dollars invested in the six data centers. We're also introducing as well -- continuing the marketing programs will continue for cybersecurity and other IT services, But we're not going to bring in IBM and sell their cloud when we know we have greater than a 50% margin, and that's something that we are just not doing anymore, frankly. I hope that answered the question on margins.

所以我想說集中運營、邁阿密數據中心和移動這些營銷活動並不是說我們在銷售 IBM 的雲，而是在銷售我們自己的雲，我們在六個數據中心投資了數百萬美元。我們也在介紹——繼續營銷計劃將繼續用於網絡安全和其他 IT 服務，但是當我們知道我們有超過 50% 的利潤時，我們不會引入 IBM 並出售他們的雲，那是坦率地說，我們只是不再做的事情。我希望這回答了關於邊距的問題。

[Ryan Kay, RKS Capital Partners].

[Ryan Kay，RKS Capital Partners]。

I appreciate your time on today's earnings call. Could you comment a little bit more -- you touched on quite a bit about initiatives related to the sales strategy and the sales pipeline as well as improving margins. Could you comment a little bit more -- give a little more color to timelines as to when some of these initiatives may materialize?

感謝您抽出時間參加今天的財報電話會議。你能多評論一點嗎——你談到了很多與銷售戰略和銷售渠道以及提高利潤率相關的舉措。您能否再評論一點——關於其中一些舉措何時可能實現的時間表，請多加一些顏色？

I think there's -- if we were to look at things on a per month basis, I believe we'll start seeing changes if it was December. But for the most part, I think that will be the first, second, and third quarter. I think it will take us two to three quarters to get to where we really want to be on it and having everything matched out.

我認為 - 如果我們按月查看情況，我相信如果是 12 月，我們就會開始看到變化。但在大多數情況下，我認為這將是第一、第二和第三季度。我認為我們需要兩到三個季度才能到達我們真正想要的位置並使一切都匹配。

Chuck Paolillo just took over all the service delivery just a month or so ago and working through that with the staff. So I would say it will take some time on that. When you're talking about sales funnel, sales organization, we're going to be adding to the organization.

Chuck Paolillo 大約一個月前剛剛接管了所有服務交付工作，並與員工一起完成了這項工作。所以我會說這需要一些時間。當您談論銷售渠道、銷售組織時，我們將添加到組織中。

That's an increased expense, but we want to ensure that we're not burning cash. We want to be able to grow from a profitable baseline on it. But in adding individuals that are going to focus on expanding our channel partner program, that will get expensive for a little while.

這是一項增加的費用，但我們要確保我們不會燒錢。我們希望能夠從盈利的基線開始發展。但在增加將專注於擴展我們的渠道合作夥伴計劃的個人時，這將在一段時間內變得昂貴。

But what ends up happening is for these managed service providers that become channel partners, which today is a primary way that CloudFirst sells. They have the customer base. So if their client is looking for cloud, we're in there giving those proposals.

但最終發生的是這些成為渠道合作夥伴的託管服務提供商，這是今天 CloudFirst 銷售的主要方式。他們有客戶群。因此，如果他們的客戶正在尋找雲，我們就會在那裡提供這些建議。

And on top of that, we're handling the leads in most cases directly. Sometimes we pass them out to the channel partners. But we need to increase from the 50 active channel partners we have today, we need to double that, and we're going to be hiring to be able to do that.

最重要的是，在大多數情況下，我們會直接處理潛在客戶。有時我們將它們傳遞給渠道合作夥伴。但是我們需要從今天擁有的 50 個活躍渠道合作夥伴中增加，我們需要將其增加一倍，並且我們將招聘能夠做到這一點。

So on the sales funnel, it continues to grow, some fall off. When we say fall off, it just means they're just not ready at that point. We have what we consider a definition for a qualified prospect, and there's all sorts of ratings within sales force that Hal Schwartz, he is the President of CloudFirst, has put in place, and that's actually being rolled out across both -- it's at Nexxis already, but it needs to now roll out to Flagship.

所以在銷售漏斗上，它繼續增長，有些下降。當我們說跌倒時，這只是意味著他們當時還沒有準備好。我們有我們認為的合格潛在客戶的定義，並且在銷售人員中有各種各樣的評級，他是 CloudFirst 的總裁，已經到位，並且實際上正在兩個方面推出 - 它在 Nexxis已經，但現在需要推廣到 Flagship。

And Flagship folks are anxious to have that all combined as well. So we can really take close looks for forecasting purposes. In the future, we hope to give some guidance.

旗艦公司也渴望將所有這些結合起來。所以我們真的可以仔細觀察以進行預測。未來，我們希望能給予一些指導。

And as we start nailing this down a little bit more with sales force and pulling that together, I think we may be able to do that. So the sales force will grow. They'll be focused on managed service providers, channel partners. Our timeframe basically, I would say, two to three quarters to really see that change.

當我們開始用銷售人員更多地確定這一點並將其整合在一起時，我認為我們可以做到這一點。所以銷售隊伍會增長。他們將專注於託管服務提供商、渠道合作夥伴。我們的時間表基本上，我會說，兩到三個季度才能真正看到這種變化。

So -- and I've talked about improved in EBITDA margins is one thing, but I believe we'll start seeing this gross profit margin start to improve possibly in two quarters.

所以 - 我已經談到 EBITDA 利潤率的提高是一回事，但我相信我們將開始看到這個毛利率可能在兩個季度內開始改善。

Thank you. That gives me a lot of good context. I appreciate the insight and all the transformative growth opportunity and strategy to make sense. That answers my question. Thanks so much.

謝謝。這給了我很多很好的背景。我很欣賞洞察力以及所有有意義的變革性增長機會和戰略。這回答了我的問題。非常感謝。

Your next question is a follow-up question coming from Matt Galinko.

你的下一個問題是來自 Matt Galinko 的後續問題。

With respect to the changes you talked about today, are we going to see any one-time cash or noncash in the fourth quarter or sometime in the early part of 2023?

關於您今天談到的變化，我們是否會在第四季度或 2023 年初的某個時候看到任何一次性現金或非現金？

Are you referring to cash because -- to raise capital? Or are you talking about, let's say, a large equipment sale? What are you referring to?

你指的是現金，因為 - 籌集資金？或者你是在談論，比方說，大型設備銷售？你指的是什麼？

I'm talking about the realignment of Flagship strategy, management, and the organizational structure. Are there any costs related to that?

我說的是旗艦戰略、管理和組織結構的調整。是否有任何相關費用？

Not that we've identified at this point. We have not identified any situations that would cost us cash today.

不是我們現在已經確定的。我們還沒有發現任何會導致我們今天損失現金的情況。

Okay. Great. And then anything you could share about the end markets that you're seeing, changes or increased, decreased traction with? Where are you seeing activity?

好的。偉大的。然後你可以分享關於你所看到的終端市場的任何變化或增加，減少牽引力？你在哪裡看到活動？

Well, companies are recycling. They're on the three- to five-year recycle mode. So some of the very large accounts that we have that are related to equipment sales and software renewals, that continues with the existing accounts with proposals that we have outstanding, hopefully, to close in this quarter. So the folks that buy equipment, they'll continue to buy equipment based on their cycle.

好吧，公司正在回收。他們處於三到五年的回收模式。因此，我們擁有的一些與設備銷售和軟件更新相關的非常大的客戶，這些客戶繼續使用現有的客戶，我們有未完成的提案，希望能在本季度關閉。所以那些購買設備的人，他們會繼續根據他們的周期購買設備。

And as to leads coming in on subscription-based -- we -- that just continues as a steady flow. I don't think that the end of the year accelerates that at all for the most part. Because it takes several months to migrate someone's cloud infrastructure onto our cloud infrastructure from on-premise. Disaster recovery is a lot faster. So it's really when the company is ready to kind of do that.

至於基於訂閱的潛在客戶——我們——只是源源不斷。我認為年底在很大程度上不會加速這一進程。因為將某人的雲基礎設施從本地遷移到我們的雲基礎設施需要幾個月的時間。災難恢復要快得多。所以這真的是公司準備好這樣做的時候了。

There's no race that someone's going to say, I need to do this immediately unless something went on unusual in their environment. But we hope to close out some equipment sales that folks may have budgets this quarter to be able to do that.

沒有人會說，除非在他們的環境中發生異常情況，否則我需要立即執行此操作。但我們希望結束一些人們可能在本季度有預算的設備銷售，以便能夠做到這一點。

Got it. Thank you. Maybe just last one on the cost side. I saw that your SG&A line was lower sequentially and sort of lower than it was over the last three quarters -- in the third quarter. What changes -- were there any specific changes that resulted in the lower G&A expense this quarter? And is that a number that you'll reinvest into? Or how should we think about that number?

知道了。謝謝。也許只是成本方面的最後一個。我看到你的 SG&A 線連續下降，並且有點低於過去三個季度——第三季度。有什麼變化——是否有任何具體變化導致本季度的 G&A 費用降低？這是一個你會再投資的數字嗎？或者我們應該如何考慮這個數字？

Are you saying because SG&A went up? Is that what you're referring to?

你是說因為 SG&A 上漲了？那是你指的嗎？

So it went down sequentially, at least my model is correct. So I think you were at about $2.6 million in the June quarter and $2.1 million in the September quarter. So I was just curious why the dip sequentially.

所以它依次下降，至少我的模型是正確的。所以我認為你在 6 月季度約為 260 萬美元，在 9 月季度約為 210 萬美元。所以我很好奇為什麼會依次下降。

Well, a lot has to do with commissions. The commission -- when you start seeing that, when you have more new sales come in, you'll see that. Or software renewals, the account executives are paid commission when a software renews on that.

好吧，很多都與佣金有關。佣金——當你開始看到它時，當你有更多的新銷售進來時，你就會看到它。或者軟件續訂，當軟件更新時，客戶經理將獲得佣金。

And if you see equipment sales, you're going to see commissions being up, and that's because also the sales engineers and the account executive or the channel partner has commissioned that relates to that.

如果你看到設備銷售，你會看到佣金增加，那是因為銷售工程師和客戶主管或渠道合作夥伴也委託了與此相關的佣金。

So if there's an account executive sales engineer, it could vary with that, Matt. So commissions. But as to the salaried in quarter, we had any reductions there. I would say that that would be more in the third quarter that we had some reductions in project management, things like that.

因此，如果有客戶執行銷售工程師，它可能會有所不同，馬特。所以佣金。但是關於季度工資，我們在那裡有任何減少。我想說的是，第三季度我們會減少一些項目管理，諸如此類。

But I would say commissions and minor when it comes to headcount reduction. I'd have to look at it a little closer to give you an exact answer. But typically, it relates to either some reductions we did in headcount and commissions. It's more likely a larger part of that.

但在裁員方面，我會說佣金和次要費用。我得再仔細看看才能給你一個確切的答案。但通常，它與我們在員工人數和佣金方面所做的一些削減有關。它更有可能是其中的一大部分。

There appear to be no further questions in queue. I would like to turn the floor to management for any closing remarks.

隊列中似乎沒有其他問題。我想請管理層發表任何結束語。

Okay, thank you. To wrap up, we've established ourselves as a leader within the industry. We had continued to generate strong revenue year over year. We are focusing our efforts on high margin recurring subscription-based cloud and managed service contracts, as we believe it's the future of our industry.

好的謝謝。總而言之，我們已經確立了自己在行業內的領先地位。我們繼續逐年產生強勁的收入。我們將精力集中在高利潤、經常性的基於訂閱的雲和託管服務合同上，因為我們相信這是我們行業的未來。

Given our initiatives, our continued execution, and knowledgeable team, we are well positioned to further penetrate this market. I look forward to providing meaningful updates to the shareholders as developments unfold. And thank you all for your questions today. And thank you for joining. Have a good day.

鑑於我們的舉措、持續的執行力和知識淵博的團隊，我們有能力進一步滲透這個市場。隨著事態的發展，我期待為股東提供有意義的更新。感謝大家今天提出的問題。感謝您的加入。祝你有美好的一天。

Thank you, ladies and gentleman. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.

謝謝你們，女士們，先生們。這確實結束了今天的電話會議。此時您可以斷開電話線，度過美好的一天。感謝您的參與。