(EMKR) 2023 Q3 法說會逐字稿

Good morning, and thank you for standing by. Welcome to the EMCORE Corporation's Fiscal 2023 Third Quarter Results. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 1 on your telephone. You will then hear an automated message advising you your hand is raised. To withdraw your question, press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Tom Minichiello, EMCOR's Chief Financial Officer. Please go ahead.

早上好，感謝您的支持。歡迎閱讀 EMCORE Corporation 2023 財年第三季度業績。此時，所有參與者都處於只聽模式。演講者演講結束後，將進行問答環節。要在會議期間提問，您需要按電話上的星號 1。然後，您將聽到一條自動消息，建議您舉手。要撤回您的問題，請再次按星號 1-1。請注意，今天的會議正在錄製中。現在我想將會議交給今天的發言者，EMCOR 首席財務官 Tom Minichiello。請繼續。

Thank you, and good morning, everyone, and welcome to our conference call to discuss EMCORE's fiscal 2023 third quarter results. The news release we issued yesterday 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'll then update you on our financial results, and we'll conclude by taking questions. 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，大家早上好，歡迎參加我們的電話會議，討論 EMCORE 2023 財年第三季度的業績。我們昨天下午發布的新聞稿發佈在我們的網站 emcore.com 上。在本次電話會議上，EMCORE 總裁兼首席執行官 Jeff Rittichier 將首先討論我們的業務亮點。然後我將向您介紹我們的財務業績的最新情況，最後我們將回答問題。在開始之前，我們想提醒您，本文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 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當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業績的預測、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，並受到已知和未知的商業、經濟和其他風險和不確定性的影響，可能會導致實際結果、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所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 and subsequent periodic reports. 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.

我們提醒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SEC 網站sec.gov 上提供的公司文件中，包括標題為“風險因素”的部分。公司的 10-K 表格年度報告及後續定期報告。公司不承擔更新任何前瞻性陳述以使此類陳述符合實際結果或我們期望的變化的義務，除非適用法律或法規要求。

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. I will now turn the call over to Jeff.

此外，本次電話會議還將提及非公認會計準則財務指標，我們認為這些指標為管理層和投資者提供了有意義的補充信息。非公認會計準則指標反映了公司核心的持續經營業績，並有助於跨報告期間進行比較。我們鼓勵投資者審查這些非公認會計準則衡量標準，以及這些衡量標準與我們新聞稿中最具可比性的公認會計準則衡量標準的解釋和調節。我現在將把電話轉給傑夫。

Thank you, Tom, and good afternoon, everyone. Well, I guess it is morning. In Q3, EMCORE's inertial navigation business came into its own, growing 10% over the March quarter, representing the fifth sequential quarter of growth. Book-to-bill kept piece with this growth at 1.0, and the business has $68 million in backlog. Non-GAAP gross margin for inertial navigation was 30%, and the A&D segment overall was 29%. Operating expenses for inertial navigation were approximately $9.9 million. Consolidated revenue in fiscal Q3 was $26.7 million. Inertial NAV came in at 26.7%. Defense optical electronics was $300,000, and broadband posted a negative $300,000 in revenue due to a terminated $1.3 million broadband development contract.

謝謝你，湯姆，大家下午好。嗯，我猜現在是早上。第三季度，EMCORE 的慣性導航業務開始發揮作用，較 3 月份季度增長 10%，連續第五個季度實現增長。訂單出貨比保持在 1.0 的增長率，並且該業務有 6800 萬美元的積壓訂單。慣性導航的非 GAAP 毛利率為 30%，A&D 部門的總體毛利率為 29%。慣性導航的運營費用約為 990 萬美元。第三財季的合併收入為 2670 萬美元。慣性資產淨值 (NAV) 為 26.7%。國防光學電子產品為 30 萬美元，寬帶由於終止了 130 萬美元的寬帶開發合同，收入為負 30 萬美元。

Tom will provide additional details on this in his remarks. Simply put, inertial navigation performed significantly better than expectations, setting the stage for the company's evolution into a pure-play aerospace and defense business. Turning now to the broadband business. I'd like to focus on our announcement of the letter of intent to sell the linear part of the business to photonic foundries. Completion of this sale would accelerate EMCORE's ability to narrow its focus on to inertial navigation. It should also meet our objectives to create a seamless transition of supply to our customers and opportunities for our employees.

湯姆將在他的講話中提供更多細節。簡而言之，慣性導航的表現明顯好於預期，為該公司向純粹的航空航天和國防業務的發展奠定了基礎。現在轉向寬帶業務。我想重點關注我們宣布的將線性部分業務出售給光子代工廠的意向書。此次出售的完成將加速 EMCORE 將其業務重點縮小到慣性導航的能力。它還應該滿足我們的目標，即為我們的客戶創造供應的無縫過渡，並為我們的員工創造機會。

We expect to complete the sale during the September quarter. The last remaining component of broadband is the wafer fab, and we expect to conclude production for the last time within the September quarter as originally planned. Since the completed sale of the linear product line would transfer the order backlog for the affected products to (inaudible), we expect that the remaining wafer fab backlog to be approximately $3.2 million. Once the wafer fab production processes are complete in Alhambra, EMS takes over from there, assembling chips on to carriers and completing tests in (inaudible). Since there are production limits in EMS, it will take at least a year to complete all of the orders with just a handful of EMCOR employees remaining to manage the process.

我們預計將在九月季度完成銷售。寬帶的最後一個組成部分是晶圓廠，我們預計將按原計劃在九月季度內最後一次完成生產。由於線性產品線的完成銷售會將受影響產品的積壓訂單轉移至（聽不清），因此我們預計剩餘的晶圓廠積壓訂單約為 320 萬美元。一旦阿罕布拉晶圓廠的生產流程完成，EMS 就會從那裡接管，將芯片組裝到載體上並完成測試（聽不清）。由於 EMS 存在生產限制，因此至少需要一年的時間才能完成所有訂單，而只剩下少數 EMCOR 員工來管理流程。

That said, we have several interested parties conducting due diligence on the chip business and expect to have a decision on the future direction of the fab within the current quarter, bringing the tale of 2 companies to an end. Moving on to inertial navigation. I'll begin my comments by stating that we had a strong performance from our Space & Navigation, Tinley Park and conquered operations. Revenue was up about 10% quarter-over-quarter with a book-to-bill of 1.0. This is a little misleading by itself, considering the fact that inertial navigation has grown 30% from the December quarter, which was the first full quarter in which the former KVH team was merged into EMCOR.

也就是說，我們有幾個感興趣的各方正在對芯片業務進行盡職調查，並預計在本季度內就晶圓廠的未來方向做出決定，從而為兩家公司的故事畫上句號。繼續進行慣性導航。我首先要指出的是，我們的空間與導航、廷利公園和已征服的業務部門表現出色。收入環比增長約 10%，訂單出貨比為 1.0。考慮到慣性導航較 12 月季度增長了 30%，這是前 KVH 團隊併入 EMCOR 的第一個完整季度，這本身就有點誤導。

Backlog came in at a solid $68 million. Please keep in mind that this only includes hard purchase orders against our long-term contracts, not the value of the contracts themselves. In the current quarter, we expect that the book-to-bill will remain above 1.0. Operating expenses came in below budget for research and development and sales and marketing. We are mindful of our high internally funded research development spending, otherwise known as IRAD and are working to drive this down substantially in the coming quarters through nonrecurring engineering contracts from our customers.

積壓訂單達到 6800 萬美元。請記住，這僅包括我們長期合同的硬採購訂單，而不包括合同本身的價值。本季度，我們預計訂單出貨比將保持在1.0以上。研發、銷售和營銷的運營費用低於預算。我們注意到我們內部資助的研發支出（也稱為 IRAD）較高，並正在努力通過客戶的一次性工程合同在未來幾個季度大幅降低這一支出。

Consequently, we should see IRAD approach 10% of revenue within the next few quarters. We received full rate production orders for BAE's armored multipurpose vehicle program and expect this to transition into a solid yearly order pattern from this point forward. For AMPV, foreign military sales and spare orders should look periodically procure onward, providing additional upside. International bookings improved significantly this quarter, most notably in Taiwan and Poland. These included a group of unmanned and iterative platforms.

因此，我們應該會看到 IRAD 在接下來的幾個季度內接近收入的 10%。我們收到了 BAE 裝甲多用途車輛項目的全額生產訂單，並預計從現在起將轉變為穩固的年度訂單模式。對於 AMPV 而言，國外軍售和備用訂單應定期進行採購，從而提供額外的上漲空間。本季度國際預訂量顯著增加，尤其是在台灣和波蘭。其中包括一組無人和迭代平台。

We also saw substantial interest from customers in the EN-300 platform, especially in the space sector, with several key test runs starting this quarter. We've seen some positive results early in the game and eagerly await the full results of these tests to drive additional momentum. On the precision guided munitions side of the business, we have been pursuing a tiered product placement strategy to ease licensing requirements for our international customers. This approach takes a bit more time, but we should begin to see orders this quarter based on this strategic direction.

我們還看到客戶對 EN-300 平台表現出濃厚的興趣，特別是在航天領域，並從本季度開始進行了幾次關鍵測試。我們在遊戲初期就看到了一些積極的結果，並熱切地等待這些測試的完整結果，以推動更多的動力。在精確制導彈藥業務方面，我們一直在推行分層產品植入策略，以減輕國際客戶的許可要求。這種方法需要更多的時間，但我們應該在本季度開始看到基於這一戰略方向的訂單。

Beyond program capture, we are seeing important signs of acceleration of key programs into the low rate of initial production phase. This is a leading indicator of long-term growth. infrared search and track has become a key area of focus and our multiple design wins should benefit in terms of production timing. The Eris program has secured an additional bank of orders that reflect the strength and duration of the program. We are also working with major primes on securing long-term manufacturing partnerships and orders are expected to produce improved production costs and predictability. The space and navigation team has continued to integrate multiple (inaudible) inertial measurement units in support of test and validation as it continues to meet shipment targets for (inaudible), which is the booster gyro.

除了節目捕獲之外，我們還看到了關鍵節目加速進入初始生產階段低速的重要跡象。這是長期增長的領先指標。紅外搜索和跟踪已成為重點關注領域，我們的多項設計勝利應該會在生產時間方面受益。 Eris 計劃已經獲得了一批額外的訂單，這些訂單反映了該計劃的強度和持續時間。我們還與主要的主要公司合作，以確保長期的製造合作夥伴關係，並且訂單預計將提高生產成本和可預測性。空間和導航團隊繼續集成多個（聽不清）慣性測量單元以支持測試和驗證，因為它繼續滿足（聽不清）助推陀螺儀的發貨目標。

These 2 systems are critical, the launch scheduled for United Launch Alliance. The next important milestone should be reached by the end of September. Beyond that, when ULA reaches its targeted launch rates, annual Board are expected to produce $20 million to $25 million in revenue per year and help significantly improve gross margins. Quartz MEMS had a very nice uptick in shipments this quarter and scaled up margin well. We saw a favorable mix in the conquered shipments, but the operations team executed a very clean quarter with no surprises in the way of unplanned variances. We expect to continue to reduce the lumpiness and conquered as we upgrade concurred to a new ERP system in the coming months.

這兩個系統至關重要，發射計劃由聯合發射聯盟進行。下一個重要的里程碑應該在九月底達到。除此之外，當 ULA 達到其目標發射率時，年度董事會預計每年將產生 2000 萬至 2500 萬美元的收入，並有助於顯著提高毛利率。石英 MEMS 本季度出貨量大幅增長，利潤率也大幅提高。我們在已征服的出貨量中看到了有利的組合，但運營團隊執行了一個非常乾淨的季度，沒有出現計劃外差異的意外情況。我們預計，隨著我們在未來幾個月內升級到新的 ERP 系統，我們將繼續減少困難並克服困難。

Before I move on to guidance, I'd like to provide some comments on integration, which is a key area of focus this year. We did successfully transition our Chicago operations to Siteline 10, which will end the need for transition services from KDH as well as eliminate the expense. Since it's the last quarter of the year, we will not upgrade Alhambra or Concur to Siteline 10 until the new fiscal year and should complete this work in a quarter or so after getting started. Beyond ERP, we should complete the PLM PDM unification in early October, and we'll integrate Camstar MES into the Comfort and Chicago facilities after we complete the ERP upgrades. Ultimately, this will make EMCORE more efficient and will help us to improve our processes, costs and reduce inventory.

在繼續提供指導之前，我想就集成提供一些評論，這是今年的重點關注領域。我們確實成功地將芝加哥業務轉移到 Siteline 10，這將不再需要 KDH 的過渡服務並消除費用。由於現在是今年的最後一個季度，我們要到新財年才會將 Alhambra 或 Concur 升級到 Siteline 10，並且應該在開始後一個季度左右完成這項工作。除了ERP之外，我們應該在10月初完成PLM PDM統一，並且在完成ERP升級後我們將把Camstar MES集成到Comfort和Chicago工廠中。最終，這將使 EMCORE 更加高效，並幫助我們改進流程、降低成本並減少庫存。

Beyond the systems integration programs I mentioned, EMCORE has a solid road map for stripping out redundancy within engineering programs to streamline our operations and reduce development expense. Over the next few years, you should expect to see a reduction in the amount of manufacturing floor space we require a reduction in inventory and improvements in profitability. Turning now to guidance. We are expecting a few supply chain issues and order delivery dates will tamp down on growth a bit for the September quarter. Assuming that the sale of the linear product line to photonic foundries is completed, we expect consolidated revenue in the $26 million to $28 million range.

除了我提到的系統集成計劃之外，EMCORE 還制定了一個堅實的路線圖，用於消除工程計劃中的冗餘，從而簡化我們的運營並降低開發費用。在接下來的幾年中，您應該會看到製造佔地面積的減少，我們需要減少庫存並提高盈利能力。現在轉向指導。我們預計一些供應鏈問題和訂單交付日期將略微抑制九月季度的增長。假設線性產品線向光子代工廠的銷售完成，我們預計綜合收入將在 2600 萬美元至 2800 萬美元之間。

This includes inertial navigation at $25 million to $27 million, along with approximately $1 million in last time buys from the chip business. Looking beyond that into the December quarter, we expect Inertial Navigation to have a revenue range of $28 million to $30 million. With that, I'll turn the call back over to Tom.

其中包括 2500 萬至 2700 萬美元的慣性導航，以及上次從芯片業務購買的約 100 萬美元。展望 12 月份季度，我們預計慣性導航的收入將在 2800 萬美元至 3000 萬美元之間。這樣，我會將電話轉回給湯姆。

Thank you, Jeff. Let me first start off with the restructuring plan we announced during the June quarter. This plan consisted of a shutdown of the broadband segment and a discontinuance of the Defense Optoelectronics product line within the A&D segment. Because we have been keeping these operations running to fulfill customer last time buy orders, both broadband and Defense Optoelectronics were included in consolidated results as continuing operations for fiscal 3Q. So I'll first start with consolidated and segment results. After that, I'll provide a financial review for inertial navigation.

謝謝你，傑夫。首先讓我從我們在六月季度宣布的重組計劃開始。該計劃包括關閉寬帶部門以及停止 A&D 部門內的國防光電子產品線。由於我們一直保持這些業務的運行來滿足客戶上次的購買訂單，因此寬帶和國防光電都作為第三財季的持續業務納入合併業績中。因此，我將首先從合併和細分結果開始。之後，我將提供慣性導航的財務審查。

Consolidated revenue in fiscal 3Q was $26.7 million, net of $27 million for A&D less $300,000 reported for broadband. In an unusual set of circumstances subsequent to our announced shutdown of broadband, development contracts for chips and sensing products were prematurely terminated since these contracts are under the cost incurred percent of completion accounting method, of which the timing of revenue recognition is independent of the milestone billing and cash collection cycle, a $1.3 million adjustment was recorded in 3Q to properly account for the closeout of these contracts, i.e., true-up final contract revenue to final cash received.

第三財季的綜合收入為 2670 萬美元，扣除 A&D 的 2700 萬美元，減去報告的寬帶收入 30 萬美元。在我們宣布關閉寬帶後的一系列不尋常情況下，芯片和傳感產品的開發合同被提前終止，因為這些合同採用的是已發生成本百分比會計方法，其中收入確認的時間與里程碑無關在計費和現金收款週期中，第三季度記錄了130 萬美元的調整，以正確考慮這些合同的結算，即將最終合同收入調整為最終收到的現金。

Excluding this adjustment, broadband was $1 million. Within A&D, Defense Optoelectronics revenue was $300,000. This brings total last-time buy shipments in 3Q to $1.3 million, slightly above our guidance of $1 million. Turning to the rest of the consolidated results on a non-GAAP basis, consolidated gross margin was 16%, flat with 2Q and for the same reason, the highly dilutive broadband segment gross margin. On the A&D side, 3Q segment gross margin strengthened to 29%, driven by significant improvements for the inertial NAV business, which came in at 30%. For the A&D segment overall, the Inertial NAV 30% gross margin was partly offset by a lower gross margin for the discontinued defense optoelectronics component.

排除此項調整，寬帶費用為 100 萬美元。 A&D 部門的國防光電收入為 300,000 美元。這使得第三季度的最後一次購買總出貨量達到 130 萬美元，略高於我們 100 萬美元的指導。轉向非 GAAP 基礎上的其他合併業績，合併毛利率為 16%，與第二季度持平，出於同樣的原因，寬帶業務毛利率也被高度攤薄。在A&D方面，由於慣性資產淨值業務顯著改善（達到30%），第三季度分部毛利率增至29%。就整個 A&D 部門而言，慣性資產淨值 30% 的毛利率被已停產的國防光電組件的較低毛利率部分抵消。

Consolidated operating expenses were $11.1 million in fiscal 3Q compared to $12.4 million in the prior quarter. The $1.3 million decrease was largely due to lower material expenses for R&D work on FAA programs as well as lower G&A. Consolidated operating loss in the June quarter improved to $6.5 million compared to $8.1 million in the March quarter. Adjusted EBITDA was also better at negative 4.3% versus 6.5% in fiscal 2Q. Consolidated net loss was $7 million or $0.13 per share compared to $8.3 million or $0.18 per share the quarter before. Shifting to the GAAP results for a moment, fiscal 3Q loss was $9.9 million or $0.18 per share compared to $12.2 million or $0.27 per share in 2Q. GAAP results included a $1.8 million charge for severance costs related to the April 21 restructuring announcement and a $1.2 million credit as a result of insurance proceeds received in 3Q.

第三財季合併運營支出為 1,110 萬美元，上一季度為 1,240 萬美元。減少 130 萬美元主要是由於 FAA 項目研發工作的材料費用減少以及一般行政費用減少。 6 月份季度的綜合運營虧損從 3 月份季度的 810 萬美元改善至 650 萬美元。調整後 EBITDA 也較好，為負 4.3%，而第二財季為 6.5%。合併淨虧損為 700 萬美元，即每股 0.13 美元，而上一季度為 830 萬美元，即每股 0.18 美元。暫時轉向 GAAP 業績，第三季度財報虧損為 990 萬美元，即每股 0.18 美元，而第二季度虧損為 1,220 萬美元，即每股 0.27 美元。 GAAP 業績包括與 4 月 21 日重組公告相關的 180 萬美元遣散費以及因第三季度收到的保險收益而獲得的 120 萬美元信貸。

Let me now turn our attention to the non-GAAP inertial navigation results. Inertial Navigation revenue grew to $26.7 million in fiscal 3Q, a 10% increase compared to 2Q driven by double-digit growth for both our space and navigation site in Bud Lake and for QMEMS shipments in Conquer. Operations in Tinley Park continued on a steady growth path with revenue up 5% sequentially. As noted, inertial navigation gross margin expanded to 30% in 3Q, not only on the higher revenue, but also driven by a better mix and significantly improved Sportsmen's production yields. Inertial NAV R&D expense was $4.2 million in fiscal 3Q compared to $4.7 million in the prior quarter. The $500,000 decrease was due to the lower project material spend noted earlier.

現在讓我把注意力轉向非 GAAP 慣性導航結果。第三財季慣性導航收入增長至 2670 萬美元，比第二季度增長 10%，這主要得益於我們位於 Bud Lake 的空間和導航站點以及位於 Conquer 的 QMEMS 出貨量實現兩位數增長。 Tinley Park 的業務繼續穩步增長，收入環比增長 5%。如前所述，慣性導航毛利率在第三季度擴大至30%，不僅是由於收入增加，而且還受到更好的組合和運動員產量顯著提高的推動。第三財季慣性資產淨值研發費用為 420 萬美元，上一季度為 470 萬美元。減少 500,000 美元是由於前面提到的項目材料支出減少。

Turning to the balance sheet, we had cash of $20.2 million at June 30 compared to $24.8 million at March 31. The $4.6 million change during the quarter included the aforementioned insurance proceeds of $1.2 million and positive operating working capital of $1.5 million, offset by the following uses of cash during the quarter, $4.3 million adjusted EBITDA, $600,000 for litigation-related expenses, $500,000 paid for severance, $500,000 for acquisition-related costs, $900,000 used for financing activities and $500,000 for CapEx. With that, we are now opening up the call for your questions.

轉向資產負債表，截至6 月30 日，我們的現金為2,020 萬美元，而3 月31 日為2,480 萬美元。本季度460 萬美元的變化包括上述120 萬美元的保險收益和150 萬美元的正運營營運資本，被在本季度使用現金後，調整後的EBITDA 為430 萬美元，訴訟相關費用為60 萬美元，遣散費為50 萬美元，收購相關成本為50 萬美元，融資活動使用了90 萬美元，資本支出為50 萬美元。至此，我們現在開始電話詢問您的問題。

Thank you. As a reminder to ask your question, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. Please stand by while we compile the Q&A roster. First question comes from (inaudible) with Lake Street Capital, your line is open.

謝謝。作為提問提醒，請在電話上按星號 1-1，然後等待宣布您的名字。要撤回您的問題，請再次按星號 1-1。我們正在整理問答名單，請稍候。第一個問題來自 Lake Street Capital（聽不清），您的線路已開通。

Good morning guys, first question, I got 2. The first one is related to the supply chain weakness you guys mentioned. I was wondering if you're seeing any material changes in the supply chain in the mean times (inaudible) lead time?

大家早上好，第一個問題，我有 2 個。第一個問題與你們提到的供應鏈弱點有關。我想知道您是否在平均（聽不清）交貨時間內看到供應鏈發生任何重大變化？

So the question is, I'm just trying to break it up a little bit is whether or not there are material changes in the supply chain?

所以問題是，我只是想稍微分解一下供應鍊是否發生重大變化？

Yes, sorry, the lead times, I was breaking up there.

是的，抱歉，交貨時間，我在那里分手了。

Yes. It's really not, I wouldn't read a lot into it. One of the things that's become a bit of a flash point is that military grade systems on a chip, FPGAs still remain quite difficult to get, and we see last minute pushouts of deliveries. And unfortunately, you can have 99% of the parts available to build and be missing one and then you're stuck. So it's really that sort of an issue as opposed to an overall supply chain deficiency. There's just a few parts that are military grade that we just don't believe we're going to get on schedule.

是的。其實不是，我不會讀太多。其中一個有點成為熱點的事情是，軍用級芯片系統、FPGA 仍然很難獲得，而且我們看到交付在最後一刻推遲。不幸的是，您可能擁有 99% 的可用零件來構建，但缺少一個零件，您就會陷入困境。所以這確實是一個問題，而不是整個供應鏈的缺陷。只有少數部分是軍用級的，我們只是不相信我們會按計劃完成。

All right. And then my next one is related to book-to-bill. You mentioned is 1.0 this quarter, and you expect to be above 1 in Q4. Just wondering if you could share a few points of confidence that kind of give you that outlook.

好的。我的下一篇與訂單到賬單相關。您提到本季度為 1.0，您預計第四季度將高於 1。只是想知道您是否可以分享一些可以給您帶來這種前景的信心。

Could you repeat that?

你能再說一遍嗎？

So you mentioned that book-to-bill is going to be above 1.0 in Q4. I was wondering if you could share a point of confidence that in that outlook.

所以你提到第四季度的訂單出貨比將高於 1.0。我想知道您是否可以分享一下對這一前景的信心。

Well, there's really a solid demand out there in the market. We see all the product lines doing quite well. But I wouldn't necessarily call it a headwind. One of the things that's occurred because of the Ukraine war, and I don't think this is widely understood, is that when products are shipped to support Ukraine, it gets registered as foreign military sales. But the reality is it comes out of the storehouses of the various branches of service. And so what happens then is the budget priorities get shifted and the service branches that have had product shipped are demanding the cash in the budget to immediately replenish their stores. And sometimes that's at odds with what say, the Navy or the Air Force program managers have budgeted if they have to give up money to the Army where a lot of the material has come from.

嗯，市場上確實有強勁的需求。我們看到所有產品線都表現良好。但我不一定將其稱為逆風。由於烏克蘭戰爭而發生的事情之一，我認為這沒有被廣泛理解，那就是，當產品被運往烏克蘭時，它會被註冊為外國軍售。但現實是它來自各個服務部門的倉庫。因此，隨後發生的情況是預算優先事項發生了變化，已發貨產品的服務分支機構要求預算中的現金立即補充其商店。有時，這與海軍或空軍項目經理的預算不一致，如果他們必須向陸軍放棄資金，而陸軍是大量材料的來源。

So it's really, call it, a phase lag between shipping something from stores and then the push and pull between the branches of service against existing budget priorities, if that makes sense.

因此，這實際上是從商店運送商品到服務部門之間根據現有預算優先事項進行推拉之間的一個階段滯後，如果這有意義的話。

Yes, that makes sense.

是的，這是有道理的。

Thank you. Our next question will come from Richard Shannon with Craig-Hallum Capital Group, your line is open.

謝謝。我們的下一個問題將由 Craig-Hallum Capital Group 的 Richard Shannon 提出，您的線路已開通。

Well, thanks, Jeff and Tom for taking my questions here. I guess I got a few of them in no particular order. Maybe I'll just follow up on the guidance here. Jeff, thanks for the a little bit greater detail here in your prepared script versus the press release here and understanding the lifetime buys. But I also want to get a sense of what you're thinking about for gross margins here. I think at the midpoint of the inertial NAV only revenues, I think it's slightly down from your performance in the quarter, but not much. Would we expect to see an inertial NAV gross margin near that 30% number you just reported?

好吧，謝謝杰夫和湯姆在這裡回答我的問題。我想我得到了其中一些，沒有特定的順序。也許我會按照這裡的指導進行跟進。傑夫，感謝您在準備好的腳本中與此處的新聞稿相比提供了更多細節，並了解了終身購買。但我也想了解一下你們對毛利率的看法。我認為僅慣性資產淨值收入的中點，我認為它比您本季度的業績略有下降，但幅度不大。我們預計慣性資產淨值毛利率會接近您剛剛報告的 30% 嗎？

Yes. I think we should. The only thing that really is going to move around here from this point forward, Richard, is the product mix can shift a little bit quarter-to-quarter. One of the things, for example, that will affect gross margins in the next couple of quarters is the AMPV order, I mentioned from BAE, there are some other TACNAV product order we're expecting those have margins significantly above, let's call it, 30% number. There are also a few products which are not quite as good, but volume drives the margin at EMCOR. And so as volumes pick up, we'll expect to see continued improvement in gross margins in general.

是的。我認為我們應該。理查德，從現在開始，唯一真正會發生變化的是產品組合可能會按季度發生一些變化。例如，將影響未來幾個季度毛利率的因素之一是 AMPV 訂單，我從 BAE 提到，還有一些其他 TACNAV 產品訂單，我們預計這些訂單的利潤率將顯著高於，我們稱之為， 30%的數字。還有一些產品不太好，但銷量推動了 EMCOR 的利潤。因此，隨著銷量的增加，我們預計總體毛利率將持續改善。

Okay. Fair enough then. Let's talk about your comments about December quarter inertial NAV getting up to $28 million to $30 million here. The midpoint is a nice growth, it looks like double digits from the midpoint you're telling us for September. So can you talk to us a little bit about some of the drivers there?

好的。那麼就足夠了。讓我們在這裡談談您對 12 月季度慣性資產淨值高達 2800 萬至 3000 萬美元的評論。中點是一個不錯的增長，看起來比你告訴我們的 9 月份中點增長了兩位數。那麼您能和我們談談那裡的一些司機嗎？

Sure. There are some planned delivery date that have moved around a little bit, customers do take advantage of the fact that government fiscal year is the end of September. And so when you look at that, some guys that have additional money will want to pull things in and some guys who don't have money until Q1, I'd like to push things out. So there's a little bit of that in there. But overall, the trend is that you've got new programs that are picking up heading into low rate of initial production, and we're expecting to see those require support in terms of shipments in the December quarter.

當然。一些計劃的交貨日期有所變動，客戶確實利用了政府財政年度是 9 月底這一事實。因此，當你看到這一點時，一些有額外資金的人會想要把東西拉進去，而一些直到第一季度才有錢的人，我想把東西推出來。所以里面有一點。但總體而言，趨勢是新項目正在進入低初始生產率，我們預計這些項目需要在 12 月季度的出貨量方面得到支持。

So we're looking at some AMPV orders that will come in. We're looking for final shipments of one of our development programs. And it's one of these things, it's a little lumpy, but sometimes you get nonrecurring engineering billings and then you have a bit of a chunk at the end of the particular program phase as the prototypes are delivered. But overall, what I'm really trying to get across is that there is a strengthening of demand. There is a consistency within the order patterns that give us confidence to go out a little further to provide guidance where we wouldn't ever have done that as a broadband company. Again, $68 million in backlog, we can see out several quarters now consistently. And we'll expect that to continue to improve.

因此，我們正在考慮一些即將到來的 AMPV 訂單。我們正在尋找我們的開發項目之一的最終發貨。這是其中之一，它有點不穩定，但有時你會得到非經常性的工程賬單，然後在交付原型時在特定項目階段結束時你會得到一點塊。但總的來說，我真正想要傳達的是需求的增強。訂單模式具有一致性，這讓我們有信心進一步提供指導，而作為一家寬帶公司，我們永遠不會這樣做。同樣，積壓金額為 6800 萬美元，我們現在可以看到幾個季度的情況始終如一。我們預計這一情況將繼續改善。

Okay. And then given that visibility, I guess I would assume that your gross margins be in segment here would be at least as high in December as September just because of the growth and all drive growth margin at (inaudible)?

好的。然後考慮到這種可見性，我想我會假設您的毛利率在 12 月至少會與 9 月一樣高，因為增長和所有推動增長的利潤率在（聽不清）？

Yes. That's completely fair.

是的。這是完全公平的。

Okay. Good to hear. Maybe jumping over, I'm not even sure what to call the activities you announced yesterday, disposal of defense opto, et cetera, here. Do I understand correctly that there's no effective purchase price really just a liability transfer and OpEx savings dynamic here for you? Or do you expect some sort of proceeds on the completion of this disposal, I guess, we'll call it?

好的。很高興聽到。也許跳過，我什至不知道如何稱呼你昨天宣布的活動，處置防禦光電等等。我是否正確理解，這裡沒有有效的購買價格，實際上只是責任轉移和運營支出節省動態？或者您是否期望在完成此次處置後獲得某種收益，我想，我們會這麼稱呼它？

Yes. So I would say that it was the former scenario within what you mentioned. There are significant liabilities associated with broadband with one particular supplier in the supply chain. I would also say that I think we've done a reasonable job at getting the factories more correctly moving again. But every time you do this sort of thing, you run into problems as far as gosh, we need a special silver build epoxy. We needed to get it into China, trying to get export restrictions, and it's going to take 8 weeks to get something that you could get here in the States overnight.

是的。所以我想說的是你提到的前一種情況。供應鏈中的某一特定供應商存在與寬帶相關的重大責任。我還想說，我認為我們在讓工廠再次更正確地搬遷方面做了合理的工作。但每次你做這種事情時，你都會遇到問題，天哪，我們需要一種特殊的銀環氧樹脂。我們需要將其運入中國，試圖獲得出口限制，而需要 8 週的時間才能獲得可以在美國過夜的東西。

So what it does is it puts all of that sort of activity that really is amazing how much management cycle bandwidth it takes up to crack these problems. It also enables us to spin out our organization even further. For example, we still have to have quality people and engineers available inside the business to deal with RMAs and service requirements and the sale of the linear portion of broadband essentially solved that problem for us as well. It's just speeds up our ability to focus and works out, I think, well for all parties.

因此，它所做的就是將所有此類活動放入其中，解決這些問題需要佔用多少管理週期帶寬，這確實令人驚嘆。它還使我們能夠進一步擴展我們的組織。例如，我們仍然需要在企業內部擁有高素質的人員和工程師來處理 RMA 和服務要求，而寬帶線性部分的銷售也基本上為我們解決了這個問題。我認為，這只會加快我們集中註意力的能力，對各方都有好處。

Okay. And I guess, can you just kind of give us some sense of what OpEx or cost structure savings that you'll achieve upon close here?

好的。我想，您能否讓我們了解一下您在此處關閉後將實現哪些運營支出或成本結構節省？

Gosh. Well, what we gave you, I think, was there was $9.9 million in OpEx. Yes, I think you go back to the restructuring announcement on the 21st of April, Richard. And those numbers pretty much hold up because most of it was all broadband and defense opto related. So as the business gets transferred and eventually we figure out the wafer fab you save all that money. There's also a slice of it, maybe upwards of around $2 million of it was in the G&A. So that will help the business going forward. So what you're likely to see in operating expenses on a go-forward basis, inertial navigation, pure P&L is around $10 million, $9.8 million, somewhere in that range.

天哪。好吧，我想我們給你的是 990 萬美元的運營支出。是的，理查德，我想你回到 4 月 21 日的重組公告。這些數字幾乎是成立的，因為其中大部分都與寬帶和國防光電相關。因此，隨著業務轉移，最終我們找出晶圓廠，您可以節省所有這些錢。還有一部分，可能超過 200 萬美元用於一般管理費用。這將有助於業務的發展。因此，您可能會看到，慣性導航、純損益的未來運營費用約為 1000 萬美元、980 萬美元，在這個範圍內。

From what will be 12.5% before we started all this. So there's some cost of goods sold savings. So there's your at least $12 million right there. The other point that I'd make, Richard, is that as we get into this. we have identified a few areas where we might be able to take down OpEx a little further. Is it not quite ready to talk about those in detail, but we certainly will in our next call. So you haven't seen the end of OpEx reduction.

在我們開始這一切之前，這一比例為 12.5%。因此，可以節省一些商品銷售成本。所以你至少有 1200 萬美元。理查德，我要說的另一點是，當我們進入這個話題時。我們已經確定了一些可以進一步降低運營支出的領域。是不是還沒有準備好詳細討論這些問題，但我們肯定會在下次電話會議中討論。所以你還沒有看到運營支出削減的結束。

The other point to me, especially as we hit December quarter will be this, we've talked about research and development just as a monolithic number. But you're going to see us talk more about what the IRAD or the internally funded research and development number is, and we're going to make some additional refinements which should help to make it obvious how much we're really spending and how much our customers are supporting.

對我來說，另一點是，特別是當我們進入 12 月季度時，我們將研發作為一個整體數字進行討論。但是你會看到我們更多地談論 IRAD 或內部資助的研發數字是什麼，我們將進行一些額外的改進，這應該有助於讓我們清楚地了解我們真正花費了多少以及如何花費我們的客戶非常支持。

Okay. You kind of hit on my last question around this IRAD. So relative to the numbers that Tom just mentioned, as you get more of this NRE that lets us IRAD shine out, then that will be a further improvement in the OpEx cost structure. Is that right?

好的。你有點切中了我關於 IRAD 的最後一個問題。因此，相對於湯姆剛才提到的數字，當你獲得更多讓我們的 IRAD 脫穎而出的 NRE 時，那麼這將是運營支出成本結構的進一步改善。是對的嗎？

Yes.

是的。

Okay. All right. Great. Then I figure I pick that one up then. Okay. I think that's all the questions from you guys. I will jump on the line. Thank you.

好的。好的。偉大的。然後我想我會選擇那個。好的。我想這就是你們提出的所有問題。我會跳線。謝謝。

Thank you Richard.

謝謝理查德。

Thanks you. Our next question will come from Brian Kinstlinger from Alliance Global Partners. Your line is open.

感謝您。我們的下一個問題將來自 Alliance Global Partners 的 Brian Kinstlinger。您的線路已開通。

Great, thanks so much for taking my questions. You mentioned the $68 million backlog. I'm curious if you could provide the total value of contracts. It's not included in backlog and unfunded backlog, if you will?

太好了，非常感謝您回答我的問題。您提到了 6800 萬美元的積壓。我很好奇你能否提供合同的總價值。如果您願意的話，它不包含在積壓和無資金的積壓中？

Wow, not off the top of my head, but I'll give you 2 big ones, right? Just to give you an example. If you look into, we announced last winter, I think it was a $32 million contract for CROS 5, which will go on for 3 years. We're expecting the first purchase order for CROS 5 coming up here soon, but that would not appear in backlog at all. Another example, TAIMU, TAIMU if you take the time to look into the original documents we signed when we purchased L3 based on navigation, it specifies that a minimum of 222 units will make their way into purchase orders at a minimum. We don't have a final production price for that yet because it doesn't have to be set until after we are done with the production readiness review, which is something that happens after the final configuration is done.

哇，不是我想不到的，但我會給你兩個大的，對吧？只是給你舉個例子。如果你仔細看看，我們去年冬天宣布的，我認為這是一份價值 3200 萬美元的 CROS 5 合同，為期 3 年。我們預計 CROS 5 的第一個採購訂單很快就會到達這裡，但這根本不會出現在積壓訂單中。再比如，TAIMU，TAIMU 如果你花點時間看一下我們購買 L3 導航時簽署的原始文件，它規定至少 222 台將進入採購訂單。我們還沒有最終的生產價格，因為直到我們完成生產準備審查之後才需要設置它，這是在最終配置完成後發生的事情。

And that would be at least $50 million, if not more, and that's just part of it all, right? So double, triple, Yes, possible. But those are just 2 and those 2 alone would double more than double the backlog.

這至少是 5000 萬美元，甚至更多，而這只是全部的一部分，對嗎？所以兩倍，三倍，是的，可能的。但這些只是 2 個，僅這 2 個就會使積壓工作增加一倍以上。

Great. Understood. As it relates to TAIMU, you mentioned September is the next milestone. When do you expect TAIMU deliveries to become mature? Are we a year away? Are we 18 months away to get to that run rate you've discussed?

偉大的。明白了。就 TAIMU 而言，您提到 9 月是下一個里程碑。您預計TAIMU的交付何時成熟？我們還有一年嗎？我們還需要 18 個月才能達到您所討論的運行率嗎？

I think you're probably looking at about a year from now. The thing that you need to understand about this is you're already seeing bits of TAIMU within the Bud Lake number. So we were able to recognize the revenue for an item in backlog, which is over $9 million, which is an advanced by long lead materials, okay? It's not all of the material. It's just the longest lead parts. And as our customer and we complete critical design review as the configuration gets locked down, you'll see that progress into more production. The interesting part is, of course, that just recognizing revenue for the material, there's not that much margin in it.

我想你可能會考慮一年後的情況。您需要了解的是，您已經在 Bud Lake 數字中看到了一些 TAIMU。因此，我們能夠確認積壓訂單項目的收入，該收入超過 900 萬美元，這是由長周期材料預支的，好嗎？這不是材料的全部。這只是最長的引線部件。當我們的客戶和我們完成關鍵的設計審查並鎖定配置時，您將看到更多生產的進展。當然，有趣的是，僅僅確認材料的收入，並沒有那麼多利潤。

But even with that, we're doing just the sheer amount of work flowing through Bud Lake has improved the operating results significantly. So I've said this, I think, in every conference and a very large number of conversations, you don't think TAIMU as a hockey stick, what you're going to see is continued sequential improvement in the revenue number for Bud Lake as we progress through the program.

但即便如此，我們所做的大量工作流經巴德湖已經顯著改善了運營業績。所以我說過，我認為，在每次會議和大量對話中，你不會將 TAIMU 視為曲棍球棒，你將看到的是 Bud Lake 的收入數字持續連續改善當我們完成該計劃時。

Okay. My last question. I'm not sure if I understood correctly, but as it relates to the shortages, you've talked about them for a couple of quarters. Are they related to a different component or the same components, the circuit board you talked about? And are you hearing or seeing or expecting any change in the near future on these shortages? How much revenue are you able to generate as a result of these shortages? And does the customer wait for you to get these products? Or are they urgent needs where they have to go find them elsewhere?

好的。我的最後一個問題。我不確定我的理解是否正確，但由於它與短缺有關，你已經談論了幾個季度了。它們與不同的組件還是相同的組件（即您所說的電路板）有關？您是否聽到、看到或預期這些短缺在不久的將來會發生任何變化？由於這些短缺，您能夠產生多少收入？客戶會等你拿到這些產品嗎？或者他們是否有迫切需要，必須去其他地方尋找？

Well, in the Aerospace and Defense business, nothing happens quickly and it's rare that you have a situation where any supplier would have a large number of these components or even the final end product on the shelf, the lead times tend to be very long in this business. The particular components are, again, primarily driven by temperature range and reliability requirements.

嗯，在航空航天和國防業務中，任何事情都不會很快發生，而且很少會出現供應商擁有大量這些組件甚至貨架上的最終產品的情況，交貨時間往往很長這項業務。同樣，特定組件主要由溫度範圍和可靠性要求驅動。

And so this set of things we're chasing is different from, let's call it, general supply chain issues, which I think have gotten better over the past few quarters. But when you get to these high rel microprocessors, FPGAs, systems on a chip that go down to minus 55 degrees centigrade. There are very few people that can make them and everybody has what are called DPAS ratings, which set priorities for acquisition.

因此，我們正在追求的這一系列問題不同於一般的供應鏈問題，我認為後者在過去幾個季度已經有所改善。但是，當您使用這些高可靠性微處理器、FPGA 和片上系統時，溫度可降至 -55 攝氏度。能夠做到這一點的人很少，而且每個人都有所謂的 DPAS 評級，該評級確定了收購的優先順序。

And so what we may be able to buy for TAIMU and get our hands on because it has a DFAS rating of DXA2, we can't get them for some of the other products because they don't have a DFAS rating. So it's sort of complicated, but it's really confined to only several components. Hopefully, we'll see this start to ease as we get into '24. But I don't think this is very much across the entire spectrum of aerospace and defense companies in terms of getting their hands on these parts. Does that make sense?

因此，我們可以為 TAIMU 購買並拿到手，因為它的 DFAS 評級為 DXA2，但我們無法為其他一些產品購買它們，因為它們沒有 DFAS 評級。所以它有點複雜，但它實際上僅限於幾個組件。希望進入 24 年後我們會看到這種情況開始緩解。但我認為，就獲得這些零件而言，這對整個航空航天和國防公司來說並不重要。那有意義嗎？

Yes. Appreciate all your time. Thank you.

是的。珍惜你所有的時間。謝謝。

Thank you, I am sure no further questions in the queue. I'd like to turn the call back to Jef Rittichier for closing remarks.

謝謝，我確信隊列中沒有其他問題了。我想將電話轉回給 Jef Rittichier，讓其致閉幕詞。

Thank you. And again, I apologize for bringing back a bug from the far reaches of the customer base. But I'd like to thank everyone for their interest in EMCOR and recognize especially our aerospace and defense team for turning in such a strong effort in the past quarter. And we look forward to the next chapter of EMCORE's in Aerospace and defends business.

謝謝。再次，我為從遙遠的客戶群帶回一個錯誤而道歉。但我要感謝大家對 EMCOR 的興趣，並特別感謝我們的航空航天和國防團隊在上個季度做出的巨大努力。我們期待著 EMCORE 在航空航天和捍衛業務領域的新篇章。

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

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。