(EMKR) 2022 Q4 法說會逐字稿

Hello. Thank you for standing by, and welcome to the EMCORE Corporation Fiscal 2022 Fourth Quarter Results Conference Call. (Operator Instructions) Please be advised that today's conference may be recorded. I would now like to hand the conference over to your speaker today, Tom Minichiello, Chief Financial Officer. Please go ahead.

你好。感謝您的支持，歡迎參加 EMCORE Corporation 2022 財年第四季度業績電話會議。 （操作員說明）請注意，今天的會議可能會被錄製。我現在想把會議交給今天的演講者，首席財務官 Tom Minichiello。請繼續。

Thank you, and good afternoon, everyone, and welcome to our conference call to discuss EMCORE's Fiscal 2022 Fourth Quarter Results. The news release we issued this afternoon is posted on our website, emcore.com. On this call, Jeff Rittichier, EMCORE's President and Chief Executive Officer, will begin with the discussion of our business highlights. I will then update you on our financial results, and we'll conclude by taking questions. But before we begin, we would like to remind you that the information provided herein may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934.

謝謝，大家下午好，歡迎參加我們的電話會議，討論 EMCORE 的 2022 財年第四季度業績。我們今天下午發布的新聞稿發佈在我們的網站 emcore.com 上。在這次電話會議上，EMCORE 總裁兼首席執行官 Jeff Rittichier 將首先討論我們的業務亮點。然後我會向您介紹我們的財務結果，最後我們將提出問題。但在我們開始之前，我們想提醒您，此處提供的信息可能包括 1933 年證券法第 27A 條和 1934 年交易法第 21E 條含義內的前瞻性陳述。

These forward-looking statements are largely based on our current expectations and projections about future events and trends affecting the business. Such forward-looking statements include projections about future results, statements about plans, strategies, business prospects and changes in trends in the business and in the markets in which we operate. Management cautions that these forward-looking statements relate to future events or future financial performance and are subject to business, economic and other risks and uncertainties, both known and unknown, that may cause actual results, levels of activity, performance or achievements of the business or in our industry to be materially different from those expressed or implied by any forward-looking statements.

這些前瞻性陳述主要基於我們目前對影響業務的未來事件和趨勢的預期和預測。此類前瞻性陳述包括對未來結果的預測、有關計劃、戰略、業務前景以及業務和我們經營所在市場趨勢變化的陳述。管理層警告說，這些前瞻性陳述與未來事件或未來財務業績有關，並受已知和未知的商業、經濟和其他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、活動水平、業績或業務成就或在我們的行業中與任何前瞻性陳述明示或暗示的內容存在重大差異。

We caution you not to rely on these statements and to also consider the risks and uncertainties associated with these statements and the business, which are included in the company's filings available on the SEC's website located at sec.gov, including the sections entitled Risk Factors in the company's Annual Report on Form 10-K. The company assumes no obligation to update any forward-looking statements to conform such statements to actual results or to changes in our expectations, except as required by applicable law or regulation.

我們告誡您不要依賴這些聲明，並考慮與這些聲明和業務相關的風險和不確定性，這些風險和不確定性包含在公司的文件中，可在 SEC 網站 sec.gov 上找到，包括標題為 Risk Factors 的部分公司的 10-K 表格年度報告。公司沒有義務更新任何前瞻性陳述以使此類陳述符合實際結果或我們預期的變化，適用法律或法規要求的除外。

In addition, references will be made during this call to non-GAAP financial measures, which we believe provide meaningful supplemental information to both management and investors. The non-GAAP measures reflect the company's core ongoing operating performance and facilitates comparisons across reporting periods. Investors are encouraged to review these non-GAAP measures as well as the explanation and reconciliation of these measures to the most comparable GAAP measures included in our news release.

此外，在本次電話會議期間將提及非 GAAP 財務措施，我們認為這些措施為管理層和投資者提供了有意義的補充信息。非 GAAP 措施反映了公司的核心持續經營業績，並有助於跨報告期進行比較。鼓勵投資者審查這些非 GAAP 措施，以及這些措施與我們新聞稿中包含的最具可比性的 GAAP 措施的解釋和協調。

I will now turn the call over to Jeff.

我現在將把電話轉給傑夫。

Thank you, Tom, and good afternoon, everyone. Q4 represented a major turning point for EMCORE as it accelerated its move into Aerospace and Defense with the purchase of KVH and the continued integration of the former L3 Harris Space & Navigation team. EMCORE is now the largest independent provider of Inertial Navigation Solutions, putting us on a runway to being a much larger business in the future. Consolidated revenue for fiscal Q4 was $25.6 million, with 82% coming from Aerospace and Defense and 18% coming from Broadband.

謝謝你，湯姆，大家下午好。第 4 季度代表了 EMCORE 的一個重大轉折點，因為它通過購買 KVH 和繼續整合前 L3 Harris Space & Navigation 團隊加速進入航空航天和國防領域。 EMCORE 現在是最大的慣性導航解決方案獨立供應商，這使我們走上了跑道，成為未來規模更大的企業。第四財季的綜合收入為 2560 萬美元，其中 82% 來自航空航天和國防，18% 來自寬帶。

Cable TV represented less than 8% of the company's revenue. Changes of this magnitude presents significant operating challenges under any circumstances and in Q4, the changes created significant turbulence in our operating results generating an operating loss of $10.8 million and adjusted EBITDA of negative $9.4 million. Our non-GAAP operating loss was $6.3 million and adjusted non-GAAP EBITDA was negative $5.1 million. Tom will provide color on Q4's gross margin, but I will start off by saying that margins were affected by a number of events that are not expected to repeat themselves going forward.

有線電視占公司收入的不到 8%。這種幅度的變化在任何情況下都會帶來重大的運營挑戰，在第四季度，這些變化對我們的經營業績造成了巨大的動盪，導致經營虧損 1080 萬美元，調整後的 EBITDA 為負 940 萬美元。我們的非 GAAP 營業虧損為 630 萬美元，調整後的非 GAAP EBITDA 為負 510 萬美元。湯姆將提供有關第四季度毛利率的顏色，但我首先要說的是，利潤率受到許多預計不會在未來重演的事件的影響。

In the aftermath of COVID, the Cable TV industry itself continues to struggle underneath the overhang of a demand bubble that caused nearly five years' worth of products that were built within a two-year period. The players in the industry are also changing as well. In our last call, we pointed out that Cisco decided to exit the Cable TV Equipment business. However, just last week, ATX publicly announced that they licensed the entire Prisma II technology platform from Cisco, allowing that technology to move forward. While these developments are expected to improve Cable TV demand over the longer term, we don't expect them to provide a meaningful catalyst for recovery in the next few quarters.

在 COVID 之後，有線電視行業本身繼續在需求泡沫的陰影下苦苦掙扎，導致兩年內生產了近五年的產品。該行業的參與者也在發生變化。在上次電話會議中，我們指出思科決定退出有線電視設備業務。然而，就在上週，ATX 公開宣布他們從思科獲得了整個 Prisma II 技術平台的許可，從而使該技術得以向前發展。雖然這些發展有望在長期內改善有線電視需求，但我們預計它們不會在未來幾個季度為複蘇提供有意義的催化劑。

Semiconductor availability slowed down shipments for wireless and chips within broadband in Q4 as our customers were not able to get enough silicon to ship transceivers and DAS systems to meet their own internal projections. With that said our Chip business continued to get additional traction with customers in the form of engagements and planned growth in shipments. Going forward on the chip business, we expect to see the ramp get a bit steeper during the summer, setting the stage for a much stronger FY '24.

由於我們的客戶無法獲得足夠的矽來運送收發器和 DAS 系統以滿足他們自己的內部預測，因此半導體可用性減緩了第四季度無線和寬帶芯片的出貨量。話雖如此，我們的芯片業務繼續以參與和計劃出貨量增長的形式吸引客戶。展望芯片業務，我們預計夏季的增長會更加陡峭，為更強勁的 24 財年奠定基礎。

To conclude my statements about broadband, I'd like to return to a statement from our last call in which I made the point that Cable TV was increasingly incongruent with our strategic direction. Today, I would update this to say that we've made meaningful progress on resolving the strategic mismatch between non-core assets in our direction in Aerospace and Defense. Turning now to Aerospace and Defense, I'll begin my comments with our Chicago operation, which was formerly owned by KVH. During Q4, the Chicago team met the shipment goals we set during due diligence and began the integration process.

在結束我關於寬帶的發言時，我想回到我們上次電話會議的聲明中，我在其中指出有線電視與我們的戰略方向越來越不一致。今天，我想更新一下，說我們在解決我們在航空航天和國防方向的非核心資產之間的戰略不匹配方面取得了有意義的進展。現在轉向航空航天和國防，我將從我們的芝加哥業務開始我的評論，該業務以前由 KVH 所有。在第四季度，芝加哥團隊實現了我們在盡職調查中設定的出貨目標，並開始了整合過程。

We subsequently identified two development programs that needed help to get back on schedule, and were able to get them back on track. The combined efforts of the extended engineering teams in Budd Lake and Concord allowed shipments of these new products to begin in the December quarter. We also began to lean on coil winding technology and supply agreements that originated in Chicago, validating important scalability and cost synergy arguments that we made in favor of the transaction last summer, Chicago has a strong book of orders and is now able to begin the production ramp for several of their new products.

我們隨後確定了兩個需要幫助才能按計劃進行的開發計劃，並且能夠使它們重回正軌。在 Budd Lake 和 Concord 的擴展工程團隊的共同努力下，這些新產品在 12 月季度開始發貨。我們還開始依賴起源於芝加哥的線圈繞組技術和供應協議，驗證了我們去年夏天支持交易的重要可擴展性和成本協同論點，芝加哥擁有大量訂單，現在可以開始生產他們的幾個新產品的坡道。

I would also point out that they were recently awarded several new contracts, the largest of which is for over $30 million for five years' worth of production. The Space & Navigation team continued to make solid progress on the new TAIMU or TAIMU long-term navigation-grade IMU even as it continues to meet shipment targets for BoRG. These two systems are critical to the launch schedule for United Launch Alliance. BoRG is part of the Boost Stage Flight Control for Atlas Centaur and Vulcan launch vehicles, while TAIMU will be the primary IMU used for navigation.

我還要指出，他們最近獲得了幾份新合同，其中最大的合同價值超過 3000 萬美元，用於五年的生產。 Space & Navigation 團隊繼續在新的 TAIMU 或 TAIMU 長期導航級 IMU 上取得穩步進展，同時繼續滿足 BoRG 的出貨目標。這兩個系統對於 United Launch Alliance 的發射計劃至關重要。 BoRG 是 Atlas Centaur 和 Vulcan 運載火箭助推級飛行控制的一部分，而 TAIMU 將是用於導航的主要 IMU。

Critical milestones for TAIMU are set to happen in the March quarter as well as the beginning of product builds in Alhambra. Our expectation is to complete qualification late in the calendar year to enable significant volume builds and launches in calendar year '24. When these products hit full production, they are expected to produce $20 million to $25 million annually in revenue. The QMEMS product line continues to recover its order book from the civil aviation downdraft that happens during -- happened during COVID. We are getting more 777X orders, along with a significant uptick of demand for inertial systems used in business and regional jets.

TAIMU 的關鍵里程碑將在 3 月季度以及 Alhambra 產品構建的開始發生。我們的期望是在日曆年晚些時候完成資格認證，以便在 24 年日曆年實現大量構建和發布。當這些產品全面投產時，預計每年可產生 2000 萬至 2500 萬美元的收入。 QMEMS 產品線繼續從 COVID 期間發生的民航下降趨勢中恢復其訂單簿。我們獲得了更多的 777X 訂單，同時對用於公務和支線噴氣式飛機的慣性系統的需求顯著增加。

In Q4, we shipped all of a critical precision guide ammunition or PGM order for an important international customer. We're expecting that this will enable us to be qualified for larger domestic contracts as well as exports. As we've said before, PGMs are the largest market segment for inertial measurement systems and are expected to be an area of significant growth for EMCORE in FY '23. Beyond this customer, we are working to test and qualify the SDI170 with defense contractors worldwide. In a recent international trip, I was advised that annual target volumes range from 1,000 to 4,000 units per year with a total value of approximately $30 million.

在第四季度，我們為一個重要的國際客戶運送了所有關鍵的精確制導彈藥或 PGM 訂單。我們期望這將使我們有資格獲得更大的國內合同和出口合同。正如我們之前所說，PGM 是慣性測量系統最大的細分市場，預計將成為 EMCORE 在 23 財年顯著增長的領域。除了該客戶之外，我們還與全球的國防承包商一起對 SDI170 進行測試和鑑定。在最近的一次國際旅行中，我被告知每年的目標銷量為 1,000 到 4,000 件，總價值約為 3000 萬美元。

Before I move on to guidance, I'd like to focus a few comments on the integration of Space & Navigation and the former KVH team. One of our key objectives in this year is to make all four of our manufacturing facilities work like a single entity. As of today, Space & Navigation is now running a common ERP system with the rest of EMCORE and has made the cutover from L3 Harris' IT system. This will enable us to exit the cost of the transition services agreement that was part of the transaction. Chicago is running about a quarter behind Space & Navigation, but we've already moved the Rhode Island engineering team out of the KVH building.

在繼續進行指導之前，我想重點談談 Space & Navigation 與前 KVH 團隊的整合。我們今年的主要目標之一是讓我們所有的四個製造工廠像一個整體一樣運作。時至今日，Space & Navigation 正在與 EMCORE 的其餘部分運行一個通用的 ERP 系統，並已從 L3 Harris 的 IT 系統切換過來。這將使我們能夠退出作為交易一部分的過渡服務協議的成本。芝加哥比太空與導航落後大約四分之一，但我們已經將羅德島工程團隊搬出 KVH 大樓。

While cutting costs is important, the true benefits of scale are only realized when we have all the facilities on common ERP, MES and PLM systems. We began rolling out Camstar MES for shop floor control in Alhambra and expect to integrate this into the other facilities after we complete the ERP upgrades and exit transition services. Ultimately, this will make EMCORE more efficient and will help us improve our processes and reduce OpEx and inventory.

雖然削減成本很重要，但只有當我們擁有通用 ERP、MES 和 PLM 系統上的所有設施時，規模的真正好處才能實現。我們開始在 Alhambra 推出用於車間控制的 Camstar MES，並希望在我們完成 ERP 升級和退出過渡服務後將其集成到其他設施中。最終，這將使 EMCORE 更加高效，並將幫助我們改進流程並減少運營支出和庫存。

Turning now for guidance for the current quarter; we continue to see weakness in the Cable TV and Wireless markets. Although we will make modest gains in chip revenue, it won't be enough to offset the weakness in Cable TV. Inertial Navigation will see growth largely driven by a full quarter's performance out of Chicago. Consequently, we're expecting revenue in the $25 million to $27 million range for the December quarter.

現在轉向當前季度的指導；我們繼續看到有線電視和無線市場的疲軟。儘管我們將在芯片收入方面取得適度增長，但這不足以抵消有線電視業務的疲軟。 Inertial Navigation 的增長主要受芝加哥以外整個季度的業績推動。因此，我們預計 12 月季度的收入在 2500 萬至 2700 萬美元之間。

With that, I will turn the call back over to Tom.

有了這個，我會把電話轉回給湯姆。

Thank you, Jeff. Consolidated revenue for fiscal 4Q was $25.6 million, with 82% coming from Aerospace and Defense and 18% from Broadband. Aerospace and Defense segment revenue was $21 million, a $7.6 million increase when compared to the prior quarter. The A&D revenue growth was largely attributable to the addition of the Inertial Navigation operation in Tinley Park, Illinois located just outside of Chicago that was acquired from KVH Industries on August 9.

謝謝你，傑夫。第四財季的綜合收入為 2560 萬美元，其中 82% 來自航空航天和國防，18% 來自寬帶。航空航天和國防部門收入為 2100 萬美元，比上一季度增加 760 萬美元。 A&D 收入的增長主要歸功於 8 月 9 日從 KVH Industries 收購的位於芝加哥郊外的伊利諾伊州廷利公園的慣性導航業務。

In addition, the rest of the A&D segment was collectively up by $1.5 million or 11% on a sequential quarter basis, a rebound in sales of QMEMS products following supply chain shortages during the prior quarter, increased Space & Navigation revenue and higher FOG shipments all led the way partly offset by lower Defense Optoelectronics revenue. Broadband revenue was $4.6 million, a $5.7 million decrease when compared to fiscal 3Q.

此外，A&D 部門的其餘部分環比增長 150 萬美元或 11%，QMEMS 產品的銷售額在上一季度供應鏈短缺後出現反彈，空間與導航收入增加以及 FOG 出貨量增加領先的部分被較低的國防光電收入所抵消。寬帶收入為 460 萬美元，與第三財季相比減少了 570 萬美元。

$5 million of the drop was due to the continued downward slide of optical transmitters and lasers sold into the Cable TV infrastructure market. These products generated revenue of $2 million in the quarter compared to $7 million the quarter before and compared to $29.5 million in the fourth fiscal quarter of last year. Clearly, this time around, we are in a much deeper Cable TV down cycle than the company has experienced in at least the last 10 years. Non-Cable TV broadband revenue was down $700,000 due mostly to sales of wire -- I'm sorry, to sales to wireless customers.

500 萬美元的下降是由於銷售到有線電視基礎設施市場的光發射器和激光器持續下滑。這些產品在本季度創造了 200 萬美元的收入，而上一季度為 700 萬美元，去年第四財季為 2950 萬美元。顯然，這一次，我們所處的有線電視下行週期比該公司至少在過去 10 年所經歷的要深得多。非有線電視寬帶收入下降了 700,000 美元，主要是由於有線銷售——對不起，是對無線客戶的銷售。

Chips and sensing revenues were essentially flat. Let me now turn to the rest of the operating results, the focus of which will be on a non-GAAP basis. Consolidated gross margin of 2% compared to 18% the quarter before was impacted by several factors that include the following: first, 4Q was the first full reporting quarter for the Space & Navigation business in Budd Lake and included higher-than-normal costs due to the timing of revenue and cost recognition under its percentage of completion accounting method.

芯片和傳感收入基本持平。現在讓我談談其餘的經營業績，其重點將放在非 GAAP 基礎上。綜合毛利率為 2%，而上一季度為 18%，受到以下幾個因素的影響：首先，第四季度是巴德湖空間與導航業務的第一個完整報告季度，其中包括高於正常水平的成本根據其完工百分比會計法確認收入和成本的時間。

Second, the Chicago Inertial Navigation business was acquired in the middle of the quarter and included prorated costs that resulted in a gross margin for the partial quarter, significantly below levels consistently achieved in the past. Third, our QMEMS operation in Concord included two non-recurring charges, one associated with a revaluation of inventory to a more recent/lower component costs and the other was an adjustment resulting from a full physical inventory count taken at year-end.

其次，芝加哥慣性導航業務是在本季度中期收購的，其中包括按比例分配的成本，這導致該部分季度的毛利率大大低於過去一直達到的水平。第三，我們在 Concord 的 QMEMS 業務包括兩項非經常性費用，一項與將庫存重估為最近/較低的組件成本相關，另一項是由於年底進行的全面實物庫存盤點而產生的調整。

Fourth, for the Broadband segment, the low gross margin was the result of the aforementioned drop in Cable TV revenue and continued under-absorption of overhead costs, including the Alhambra wafer fab. Many of the factors related to the two recently acquired operations in Budd Lake and Chicago are transitional in nature, and we expect once fully integrated, that both businesses will return to their historical margin performances or better. Operating expenses were $11.2 million in fiscal 4Q compared to $10.5 million in the prior quarter, due largely to the inclusion of the Inertial Navigation acquisition for part of the quarter.

第四，對於寬帶業務，低毛利率是上述有線電視收入下降和間接費用持續吸收不足的結果，包括 Alhambra 晶圓廠。與最近收購的 Budd Lake 和 Chicago 兩項業務相關的許多因素在本質上都是過渡性的，我們預計一旦完全整合，這兩項業務將恢復到歷史利潤率表現或更好。第四財季的運營支出為 1,120 萬美元，而上一季度為 1,050 萬美元，這主要是由於在本季度的部分時間包含了對慣性導航的收購。

Before moving to the bottom line, it's important to highlight that EMCORE has undergone a momentous and rapid change to the revenue profile. The first half of fiscal '22 accounted for 60% of total year revenue, during which time broadband accounted for 75% of the business. In just a couple of quarters later in fiscal 4Q, this has completely flipped to over 80% of revenue coming from Aerospace and Defense. The company is now better positioned for higher growth with a broader-based portfolio of Inertial Navigation products, expanded customer reach and in a substantially larger and more stable marketplace than the highly cyclical Cable TV market.

在談到底線之前，重要的是要強調 EMCORE 的收入狀況發生了重大而迅速的變化。 22 財年上半年佔全年總收入的 60%，在此期間寬帶佔業務的 75%。在短短幾個季度後的第四財季，這已經完全轉變為來自航空航天和國防的收入的 80% 以上。憑藉更廣泛的慣性導航產品組合、擴大的客戶範圍以及比周期性很強的有線電視市場更大、更穩定的市場，該公司現在處於更有利的地位，可以實現更高的增長。

There is no doubt A&D is our future. We are now the world's fourth largest and largest independent provider of inertial navigation solutions. Our fiscal 4Q results reflect the significant and swift changes to the size and mix of the top line. Together with the gross margin items I just outlined as well as the need to invest in future growth, 4Q operating loss was $10.8 million, adjusted EBITDA was negative $9.4 million and net loss was $10.9 million or $0.29 per share. Shifting to the GAAP results for a moment; fiscal 4Q net loss was $16.9 million or $0.45 per share.

毫無疑問，A&D 是我們的未來。我們現在是世界第四大和最大的慣性導航解決方案獨立供應商。我們的第四財季業績反映了收入規模和組合的重大而迅速的變化。加上我剛才概述的毛利率項目以及投資未來增長的需要，第四季度營業虧損為 1080 萬美元，調整後的 EBITDA 為負 940 萬美元，淨虧損為 1090 萬美元或每股 0.29 美元。暫時轉向 GAAP 結果；第四財季淨虧損為 1690 萬美元或每股 0.45 美元。

This included one-time transaction costs of $5.2 million associated with the acquisitions. The GAAP results also included two non-cash items excluded from the non-GAAP measures, a $3 million long-lived asset impairment charge associated with the Alhambra FOG operation, and a $3.1 million accounting credit related to the reversal of variable incentive comp accrued during the first three quarters of fiscal '22. Turning to the balance sheet; we had cash of $26.1 million at September 30 compared to $75.1 million at June 30. The $49 million decrease consisted of $55 million to acquire the Chicago Inertial Navigation business, $2.4 million representing the second and final payment related to the Space and Nav acquisition, $5.2 million in acquisition transaction costs and $1.8 million in CapEx.

這包括與收購相關的 520 萬美元的一次性交易成本。 GAAP 結果還包括從非 GAAP 措施中排除的兩個非現金項目，與 Alhambra FOG 運營相關的 300 萬美元長期資產減值費用，以及與期間應計的可變激勵補償逆轉相關的 310 萬美元會計貸記22 財年的前三個季度。轉向資產負債表；截至 9 月 30 日，我們的現金為 2610 萬美元，而 6 月 30 日為 7510 萬美元。減少的 4900 萬美元包括用於收購芝加哥慣性導航業務的 5500 萬美元，240 萬美元代表與 Space and Nav 收購相關的第二筆也是最後一筆付款，5.2 美元百萬的收購交易成本和 180 萬美元的資本支出。

Offsetting these uses of cash was $15.5 million included in cash from financing activities, which represents the borrowing level at September 30 under a credit facility entered into with Wingspire Capital at the time of the Inertial Nav acquisition from KVH. Before we get to questions, I'd also like to cover a couple of other recent events. First, the integration of our two acquisitions involved a recently completed management reorganization and cost rationalization initiative.

抵消這些現金使用的是來自融資活動的現金中的 1550 萬美元，這代表了 9 月 30 日在從 KVH 收購 Inertial Nav 時與 Wingspire Capital 簽訂的信貸額度下的借款水平。在我們開始提問之前，我還想介紹一下最近發生的其他幾件事。首先，我們兩次收購的整合涉及最近完成的管理重組和成本合理化計劃。

This included a reduction in force designed to reduce costs and expenses by a total of approximately $3.6 million annually, split between roughly 55% cost of goods sold and 45% OpEx. We expect to record a charge in the December quarter for related severance costs, which we anticipate will comprise a combination of accelerated stock vesting and cash over time. Second, as announced last week, we completed the sale and leaseback transaction of the Tinley Park property obtained as part of the Inertial Nav asset acquisition from KVH. This transaction generated $10.3 million in net cash proceeds.

這包括裁員，旨在每年減少總計約 360 萬美元的成本和開支，其中約佔 55% 的銷售成本和 45% 的運營支出。我們預計將在 12 月季度記錄相關遣散費的費用，我們預計這將包括加速股票歸屬和現金的組合。其次，正如上周宣布的那樣，我們完成了作為從 KVH 收購 Inertial Nav 資產的一部分而獲得的 Tinley Park 物業的售後回租交易。該交易產生了 1030 萬美元的淨現金收益。

So with that, we are now opening up the call for your questions.

因此，我們現在開始徵求您的問題。

(Operator Instructions) Richard Shannon, your line is now open.

（操作員說明）Richard Shannon，您的線路現已開通。

Okay. Great, guys. [I think] the first one on gross margins. Tom, you mentioned a number of items here that you're seeing are one-time in nature. I don't want to repeat them. I think there were four of them. The broadband one certainly makes sense. It seems like other ones are potentially transitional here. I wonder if you could help us understand how much magnitude that added to COGS in the September quarter. And ultimately, how do we think about what are you thinking about for gross margins for December?

好的。太好了，伙計們。 [我認為]第一個關於毛利率。湯姆，你在這裡提到了一些你看到的物品本質上是一次性的。我不想重複它們。我想他們有四個。寬帶當然是有道理的。似乎其他人在這裡可能是過渡性的。我想知道您是否可以幫助我們了解 9 月季度 COGS 增加了多少幅度。最終，我們如何看待您對 12 月份毛利率的看法？

So Richard, the total of -- let's just stick with the A&D side where we had the two acquisition gross margins and our -- the charges that I mentioned for Quartz MEMS and Concord. So when you take all of those and the impact in the quarter and you adjust for that, you've taken an A&D gross margin up to, call it, high -- mid- to high teens, 16%, 17%, just with that alone. And so you're getting back to even better than where it was last quarter. And there's other activities and things that we have done with this business as we integrate the acquisitions and as we do things in the Quartz MEMS operation with yields and prices and things like that, that put us on a much healthier trajectory.

所以理查德，總的來說——讓我們堅持 A&D 方面，我們有兩個收購毛利率和我們的——我提到的 Quartz MEMS 和 Concord 的費用。因此，當你考慮所有這些以及本季度的影響並對此進行調整時，你已經將 A&D 毛利率提高到，稱之為高——中高青少年，16%，17%，只是那一個人。所以你會回到比上個季度更好的狀態。隨著我們整合收購，以及我們在 Quartz MEMS 業務中以收益率和價格等方式開展業務，我們在這項業務中還開展了其他活動和事情，這讓我們走上了更健康的軌道。

Okay. Do you want to try to quantify what you're thinking about that for December? I think given your 11 days from the end of the quarter or so here, it seems like you'd have a good view on what that is. So a good start with the A&D number here in the mid-teens, 16%, 17%, but how would you put this all together here?

好的。你想嘗試量化你對 12 月份的想法嗎？我認為考慮到您從本季度末開始的 11 天左右，您似乎對那是什麼有很好的看法。因此，這裡的 A&D 數字是 16%、17% 的一個良好開端，但您如何將所有這些放在一起？

Yeah. I think that number is if you just sort of adjust for the items that I outlined in the prepared remarks, the way to think about it is -- so A&D between the changes we're doing in Quartz MEMS and the acquisition integration, I would call it mid to sort of low to mid-20% range for A&D. And if you -- so the issue then becomes for the consolidated gross margin, broadband isn't going to be all that much better because it's Cable TV down cycle we're in is not going to improve for several quarters. So you'll see that continue to struggle because of the -- just the size of the revenue alone.

是的。我認為這個數字是，如果你只是對我在準備好的評論中概述的項目進行某種調整，那麼考慮它的方式是——所以我們在 Quartz MEMS 中所做的更改和收購集成之間的 A&D，我會將其稱為 A&D 的中低到中等 20% 範圍。如果你——那麼問題就變成了綜合毛利率，寬帶不會好得多，因為我們所處的有線電視下行週期在幾個季度內都不會改善。所以你會看到它繼續掙扎，因為 - 僅僅是收入的規模。

So when you put it together, you're looking at a consolidated number, 20%, plus or minus, maybe a little bit higher 20%, 21%, 22% if things go well. That's just in the December quarter because a lot of the things that we're doing have some impact in the fourth -- in the December quarter. But for example, the reduction in force that we -- I just talked about, that happened late in the quarter, kind of early December.

所以當你把它們放在一起時，你會看到一個綜合數字，20%，正負，如果一切順利的話可能會高一點，20%、21%、22%。那隻是在 12 月季度，因為我們正在做的很多事情都會對第四季度產生一些影響——在 12 月季度。但是，例如，我們——我剛才談到的裁員發生在本季度末，大約在 12 月初。

So we'll get a little bit of that in the December quarter, but that will -- most of that will take full effect in the March quarter. So as we take those kinds of actions and we do other things to -- on the integration front, some of the things that Jeff mentioned in terms of getting everybody onto a single system that would come sort of towards the end of the March quarter, and you'll start to see an improvement through the fiscal year on gross margin.

因此，我們將在 12 月季度獲得一些，但這將 - 大部分將在 3 月季度全面生效。因此，當我們採取這些行動並做其他事情時——在集成方面，Jeff 提到的一些事情是讓每個人都進入一個單一的系統，這將在 3 月季度末出現，你會開始看到整個財政年度毛利率有所改善。

Okay. So to catch to that last part here, so going back to the reduction of force you said $2.6 million annually with 55% of that in COGS here. So it sounds like there's been relatively little if any of that happened so far. It happened fairly late in the December quarter, but it sounds like it won't be coming into COGS necessarily immediately. So it might take a couple of quarters to see the benefit from that rip.

好的。所以要趕上這裡的最後一部分，所以回到減少力量，你說每年 260 萬美元，其中 55% 用於 COGS。所以聽起來到目前為止發生的事情相對較少。它發生在 12 月季度的相當晚的時候，但聽起來它不一定會立即進入 COGS。因此，可能需要幾個季度才能看到這種撕裂帶來的好處。

So just one correction. It's $3.6 million. If I heard you correctly, I thought you said $2.6 million.

所以只有一個更正。這是360萬美元。如果我沒聽錯的話，我以為你說的是 260 萬美元。

I think I said three, but I think I said three, but that's what (inaudible).

我想我說了三個，但我想我說了三個，但這就是（聽不清）。

Yeah, yeah, yeah, okay. I hope I said three, yeah. Okay. So yeah, $3.6 million, and so that's $900,000 a quarter. So you're looking at roughly $500 million in cost of goods sold and $400 million in operating expenses on a full quarter. And since we took the action at the early part of the last month of the December quarter, just a few weeks ago, you'll see the full impact of that in the March quarter.

是的，是的，是的，好的。我希望我說的是三個，是的。好的。所以是的，360 萬美元，也就是每季度 90 萬美元。因此，整個季度的銷售成本約為 5 億美元，運營費用約為 4 億美元。自從我們在 12 月季度的最後一個月的早些時候採取行動以來，就在幾週前，您將在 3 月季度看到它的全部影響。

Richard, let me -- this is Jeff, let me give you two other little pieces of color here. So for example, one of the things that we're not expecting to repeat on the gross margin line, hey, the good news is that we nearly doubled yield of Quartz [forks] for the Concord (inaudible) products. Bad news is we took an inventory valuation hit that was significant in the quarter. So that's the sort of thing that we're actually expecting to see some benefit from, but it hurt us in Q4.

理查德，讓我——我是傑夫，讓我在這裡給你另外兩塊小顏色。因此，例如，我們不希望在毛利率線上重複的一件事，嘿，好消息是我們將 Concord（聽不清）產品的 Quartz [forks] 產量幾乎翻了一番。壞消息是我們在本季度遭受了重大的庫存估值打擊。所以這就是我們實際上期望從中看到一些好處的事情，但它在第四季度傷害了我們。

The other thing to think about in terms of the risk is that really as EMCORE continues to simplify its business we are going to simplify the management structure and remove the folks that had positions that were more, let's call it, more broadly considered part of a larger set of BUs, right? So what it does is it just -- it collapses the BU structure, eliminate positions because we're simplifying the mission of the company.

就風險而言，要考慮的另一件事是，隨著 EMCORE 繼續簡化其業務，我們將簡化管理結構並移除那些擁有更多職位的人，讓我們稱之為，更廣泛地認為是更大的 BU 集，對吧？所以它所做的只是——它瓦解了 BU 結構，取消職位，因為我們正在簡化公司的使命。

Okay. Okay. Fair enough. Jeff, let's talk a little bit about kind of top line here. Your guidance for the quarter is clear. It sounds like it's mostly coming from the additional month of the KVH operation here. I think we've been hearing about some constraints in supply chain in parts of the business, and QMEMS among other things. So maybe kind of talk about the trends here, how much is being held back by supply or other dynamics here? And then how do we think about that going forward into the March quarter?

好的。好的。很公平。傑夫，讓我們談談這裡的頂線。您對本季度的指導很明確。聽起來它主要來自這裡的 KVH 操作的額外月份。我認為我們已經聽說部分業務的供應鏈存在一些限制，以及 QMEMS 等。所以也許可以談談這裡的趨勢，這裡的供應或其他動態阻礙了多少？然後我們如何看待進入三月季度的情況？

Yeah. So it's an interesting problem because the supply chain issue and primarily semiconductors, we weren't hit too badly in some other places where connectors oddly enough, are still an issue. But what we've seen is customers push back for -- that are expecting chip shipments because they actually can't get enough silicon to build transceivers and/or the distributed antenna systems used in wireless. But what we're expecting to see because we are now getting shipments of circuit boards that aren't going to help us much in the current quarter, but they will help us in March. So I would expect to see March look better from a supply constraint perspective.

是的。所以這是一個有趣的問題，因為供應鏈問題，主要是半導體，我們在其他一些連接器奇怪的地方並沒有受到太嚴重的打擊，仍然是一個問題。但我們看到的是客戶的反對——他們期望芯片出貨，因為他們實際上無法獲得足夠的矽來構建收發器和/或無線中使用的分佈式天線系統。但我們期待看到的是因為我們現在收到的電路板在本季度不會對我們有太大幫助，但它們會在 3 月份幫助我們。因此，從供應緊張的角度來看，我預計 3 月份會好一些。

Okay. Fair enough. And then last question, I'll jump in line here, see if there's other ones out here, but just kind of putting this all together and thinking about when you guys get to breakeven and what that looks like. If you could give us any thoughts, I guess I'm probably more interested in the structure than timing because it seems like we're looking at a few quarters at least here. But maybe both of you can talk about the structure here when you get to breakeven.

好的。很公平。然後是最後一個問題，我會在這裡插隊，看看這裡是否還有其他人，但只是把所有這些放在一起，想想你們什麼時候能達到收支平衡，這是什麼樣子的。如果你能給我們任何想法，我想我可能對結構比時間更感興趣，因為看起來我們至少在這里關注幾個季度。但也許當你們達到收支平衡時，你們倆都可以在這裡談論結構。

Sure. So yes, it's several quarters out, Richard. And with improvement quarter-by-quarter until, call it, sort of the back half of the fiscal year, potentially early FY '24. It's going to depend on a lot of factors. The revenue will need to grow into the $30 million to $35 million range on a quarterly basis. And if we can hit sort of the middle of that range with a mid-30s gross margin or if we can get up to like [35%] with a sort of maybe even a lower gross margin? I mean there's a lot of moving pieces here. So somewhere in that sort of [32% to 35%] top line with a gross margin in the low to mid-30s would put you at adjusted EBITDA breakeven if you tack on sort of the forecast for operating expenses.

當然。所以，是的，已經有幾個季度了，理查德。隨著逐個季度的改進，直到，稱之為財政年度的後半部分，可能是 24 財年的早期。這將取決於很多因素。每個季度的收入需要增長到 3000 萬至 3500 萬美元之間。如果我們能以 30 多歲左右的毛利率達到該範圍的中間水平，或者我們能否達到 [35%] 甚至更低的毛利率？我的意思是這裡有很多動人的片段。因此，如果您對運營費用進行某種預測，那麼在這種 [32% 至 35%] 的收入中，毛利率在 30 年代中期的某個地方將使您處於調整後的 EBITDA 盈虧平衡點。

Yeah. So Richard, the other thing to point out here, and it echoes Tom's remarks a bit is that the gross margin number is constrained more by overhead absorption than you might think, right? When people look at gross margins, oftentimes they say, oh, prices are collapsing in the market or your costs are out of control. But the reality is overhead absorption, high fixed costs in facilities that have 30,000 gallons of liquid nitrogen, for example, are a significant factor.

是的。所以理查德，這裡要指出的另一件事是，毛利率數字比你想像的更多地受到間接費用吸收的限制，這與湯姆的言論有點相呼應，對吧？當人們查看毛利率時，他們通常會說，哦，市場價格正在崩潰，或者您的成本失控了。但現實是開銷吸收，例如，擁有 30,000 加侖液氮的設施的高固定成本是一個重要因素。

And so as I mentioned in my comments, one of the important things that's about to start happening in the March quarter is we are going to be building a high volume, high-end navigation product, long-term navigation product that was designed in Budd Lake for ULA. And that will make a significant dent in this volume margin constraint that we've been feeling for a while now. I think also the signs are positive in Chicago. Now that we've collectively cleared out a few things with a new product, which we just announced, I believe you asked me about is TAC-450 and the whole generation of those products from the former KVH team, they are now shipping in volume.

因此，正如我在評論中提到的，即將在 3 月季度開始發生的重要事情之一是我們將構建一個大容量、高端導航產品，這是在 Budd 中設計的長期導航產品ULA 湖。這將顯著削弱我們已經感受了一段時間的體積保證金限制。我認為芝加哥的跡像也是積極的。既然我們已經用我們剛剛宣布的新產品集體清理了一些東西，我相信你問過我的是 TAC-450 和前 KVH 團隊的整代產品，它們現在正在批量出貨.

So all of that will start to really make an impact, I would say, in the March quarter, right? So Tom's got the numbers right. Qualitatively, it's about overhead absorption. It's not about driving the material cost down or the price is up, although we are instituting a 10% price increase on Quartz MEMS. It doesn't affect all of our contracts because some of those are locked in for a period of time. But certainly, for new orders, that is going to help us a bit. It's just about recovering the higher cost of semiconductors, mostly.

所以所有這些都將開始真正產生影響，我想說，在三月季度，對吧？所以湯姆的數字是正確的。定性地說，這是關於開銷吸收。這與降低材料成本或提高價格無關，儘管我們將 Quartz MEMS 的價格提高了 10%。它不會影響我們所有的合同，因為其中一些合同會被鎖定一段時間。但可以肯定的是，對於新訂單，這會對我們有所幫助。這主要是為了收回更高的半導體成本。

Yeah. Okay, great. That was good detail. I will jump out of line, Jeff and Tom.

是的。好，太棒了。這是很好的細節。我會越界，傑夫和湯姆。

Our next question comes from Tim Savageaux with Northland Securities.

我們的下一個問題來自 Northland Securities 的 Tim Savageaux。

My first question, at least is on the cable side. I know it's a small part of your business now and I guess, getting very small. I mean looking at the guidance I think we must be headed to zero in the December quarter or somewhere pretty close to that. And you frame it in the context of kind of a broader down cycle in CapEx, but that's not really what we're seeing, right, with regard to Charter talking about a multiyear investment program and most suppliers actually having pretty decent years even near-term.

我的第一個問題，至少是在電纜方面。我知道它現在只是您業務的一小部分，而且我想，會變得非常小。我的意思是看指導，我認為我們必須在 12 月季度或非常接近那個的某個地方走向零。你將它置於資本支出更廣泛的下行週期的背景下，但這並不是我們真正看到的，對，關於 Charter 談論多年投資計劃和大多數供應商實際上有相當不錯的年份甚至接近 -學期。

So I guess my question was I'm kind of searching for the disconnect there and there are several potentials, whether it's Cisco abruptly exiting the business. I know you've mentioned inventory builds before among several customers. And of course, the final factor, maybe we are at a point where some of the linear analog technology is moving out of the network more quickly. If you look at those three factors, how would you assess at least what looks from my perspective, covering half a dozen plus names in the universe sort of disconnect between what EMCORE is seeing in cable and what others are seeing.

所以我想我的問題是我正在尋找那裡的斷開連接並且有幾種可能性，無論是思科突然退出業務。我知道你之前在幾個客戶中提到過庫存構建。當然，最後一個因素，也許我們正處於一些線性模擬技術正在更快地從網絡中移出的地步。如果你看看這三個因素，你會如何評估至少從我的角度來看，涵蓋宇宙中六個以上的名字在 EMCORE 在有線電視中看到的東西與其他人看到的東西之間有點脫節。

Sure. I'll tackle that one, Tom. Real simple. It's five years' worth of lasers and transmitters that shipped in two years for COVID and a large fraction of that was never installed. And so it's sitting in the warehouses of CommScope, and it is sitting in the former major distributor of Cisco product in the U.S. And so the overhang is there. EMCORE is not a broad-based supplier of many different cable optics products. And so that's where the concentration is. We had a terrific run up, big profits because we were so efficient during the trip down. But I'm sorry, during the time that we were running at big numbers.

當然。我來解決那個問題，湯姆。真的很簡單。用於 COVID 的激光器和發射器在兩年內交付了五年的價值，其中很大一部分從未安裝過。因此，它位於 CommScope 的倉庫中，位於美國思科產品的前主要分銷商中。所以懸垂就在那裡。 EMCORE 並不是許多不同光纜產品的廣泛供應商。這就是集中的地方。我們取得了驚人的成功，獲得了豐厚的利潤，因為我們在下降過程中非常高效。但我很抱歉，在我們大量奔跑的時候。

But the interesting thing is here we are with $2 million worth of cable. And believe it or not, it's still making a little bit of a profit. And it's because we became efficient, that's how we were able to do what we did during COVID but the reality is that the pile of inventory is there is what our customers are telling us. They are actually selling more linear EML transmitters to try to clear out their warehouses. And there's just nothing we can do about that. There's no competitive losses. And the back end of the cable business, certainly with nodes and amplifiers is -- has done very well and will continue to do well. But no, for us, it's mostly about inventory that's out there.

但有趣的是，我們在這裡擁有價值 200 萬美元的有線電視。不管你信不信，它仍在賺取一點利潤。這是因為我們變得高效了，這就是我們能夠做我們在 COVID 期間所做的事情的方式，但現實情況是，我們的客戶告訴我們的是一堆庫存。他們實際上正在銷售更多的線性 EML 發射器，以試圖清理他們的倉庫。我們對此無能為力。沒有競爭損失。有線電視業務的後端，當然還有節點和放大器——已經做得很好，並將繼續做得很好。但不，對我們來說，這主要是關於那裡的庫存。

Great. And just a follow-up on that, you made a comment about making progress, I guess, on the strategic front in terms of cable. I mean, it sounds like you guys are preparing to exit that business. Do you have any color you want to add on that?

偉大的。只是對此的後續行動，你發表了關於取得進展的評論，我猜，在有線電視方面的戰略方面。我的意思是，聽起來你們正準備退出該業務。你想在上面添加什麼顏色嗎？

Wish I did. I wish I could, Tim. As soon as we've got something to say we're going to get it out there as fast as we can.

希望我做到了。我希望我能，蒂姆。一旦我們有話要說，我們就會盡快把它說出來。

Okay. And then last one for me. I wonder if you might be able to take just a quick moment and because you went through a number of programs that you were working on, on the chip side, I think last quarter or maybe a couple of quarters ago, spanning datacom, telecom sensing. It sounds like you've been making some progress there? Have you added to that? And I know you mentioned supply issues as maybe a gating factor, but how does that opportunity look compared to what you saw a quarter or two ago?

好的。然後最後一個給我。我想知道你是否可以花點時間，因為你經歷了一些你正在研究的項目，在芯片方面，我想上個季度或幾個季度前，跨越數據通信、電信傳感.聽起來你在那裡取得了一些進展？你添加了嗎？我知道你提到供應問題可能是一個門控因素，但與你一兩個季度前看到的相比，這個機會看起來如何？

Yeah. So there are -- I believe -- and I'm trying to think of exactly when it happens, so I could be off a little bit. I believe we picked up one more program in Q4 from an existing customer. And the production shipments that we talked about are moving, as we said, they would. They just haven't picked up as fast as we'd hoped and what our customers are telling us is, yeah, because we can't get enough silicon. Oddly enough, the sensing piece over in China, which is run through China Rail and Shanghai, for example, they've had COVID issues and continue to.

是的。所以有——我相信——我正在努力思考它發生的確切時間，所以我可以稍微偏離一下。我相信我們在第四季度從現有客戶那裡又獲得了一個程序。正如我們所說，我們談到的生產出貨量正在移動。他們只是沒有像我們希望的那樣快速增長，而我們的客戶告訴我們的是，是的，因為我們無法獲得足夠的矽。奇怪的是，在中國的傳感部分，例如通過中國鐵路和上海運行，他們遇到了 COVID 問題，並且還在繼續。

And so you have people even in the offices, I know it seems a little strange given how much progress there's been in Europe and the U.S. But in parts of China, it's still an issue. So I would say that the -- and we've talked about them being transceivers, these are chips that are used in tunable lasers. Beyond that, I'm not allowed to mention customer names, but hopefully, that gives you just a little more insight into what's going on. There's just a lot of silicon shortages in that business right now.

所以你甚至在辦公室裡都有人，我知道考慮到歐洲和美國取得瞭如此大的進步，這似乎有點奇怪。但在中國的部分地區，這仍然是一個問題。所以我想說——我們已經討論過它們是收發器，這些是用於可調諧激光器的芯片。除此之外，我不允許提及客戶名稱，但希望這能讓您對正在發生的事情有更多的了解。目前該行業存在大量矽短缺。

I would now like to turn the call back over to Jeff Rittichier for any closing remarks.

我現在想將電話轉回 Jeff Rittichier 以聽取任何結束語。

Sure. I'd like to close by thanking you all for your interest in EMCORE. I also want to recognize our team for their perseverance as we reinvent the company as an Aerospace and Defense business. And finally, I'd like to wish you all a wonderful holiday season and a Happy New Year. Thank you.

當然。最後，我想感謝大家對 EMCORE 的興趣。我還想表彰我們的團隊在我們將公司重塑為航空航天和國防企業時的毅力。最後，祝大家度過一個美好的假期，新年快樂。謝謝你。

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

謝謝你。今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。