Extreme Networks Inc (EXTR) 2023 Q2 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Extreme Networks Second Quarter Fiscal Year '23 Financial Results. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. (Operator Instructions) Please be advised that today's conference is being recorded.

美好的一天，謝謝你的支持。歡迎閱讀 Extreme Networks 23 財年第二季度財務業績。此時，所有參與者都處於只聽模式。演講者的演講結束後，將進行問答環節。 （操作員說明）請注意，今天的會議正在錄製中。

I would now like to hand the conference over to your speaker today, Stan Kovler, Vice President, Corporate Strategy and Investor Relations. Please go ahead.

我現在想把會議交給今天的演講者，公司戰略和投資者關係副總裁 Stan Kovler。請繼續。

Thank you, and welcome to the Extreme Networks fiscal second quarter 2023 earnings conference call. I'm Stan Kovler, Vice President of Corporate Strategy and Investor Relations. With me today are Extreme Networks' President and CEO, Ed Meyercord; and Interim CFO, Cristina Tate.

謝謝，歡迎來到 Extreme Networks 2023 財年第二季度財報電話會議。我是公司戰略和投資者關係副總裁 Stan Kovler。今天和我在一起的是 Extreme Networks 的總裁兼首席執行官 Ed Meyercord；和臨時首席財務官 Cristina Tate。

We just distributed a press release and filed an 8-K detailing Extreme's financial results for the quarter and also an 8-K detailing our CFO transition. For your convenience, a copy of the press release, which includes our GAAP to non-GAAP reconciliations, our earnings presentation are both available in the Investor Relations section of our website at extremenetworks.com.

我們剛剛發布了一份新聞稿並提交了一份詳細說明 Extreme 本季度財務業績的 8-K 以及一份詳細說明我們 CFO 過渡的 8-K。為方便起見，我們網站 extremenetworks.com 的投資者關係部分提供了一份新聞稿副本，其中包括我們的 GAAP 與非 GAAP 對賬、我們的收益介紹。

And I would like to remind you that during today's call, our discussion may include forward-looking statements about Extreme's future business, financial and operational results, growth expectations and strategies. All financial disclosures on this call will be made on a non-GAAP basis, unless stated otherwise. We caution you not to put undue reliance on these forward-looking statements, as they involve risks and uncertainties that can cause actual results to differ materially from those anticipated by these statements, as described in our risk factors in our 10-K report for the period ended June 30, 2022, is filed with the SEC. Any forward-looking statements made on this call reflect our analysis as of today and we have no plans or duty to update them except as required by law.

我想提醒您，在今天的電話會議中，我們的討論可能包括有關 Extreme 未來業務、財務和運營結果、增長預期和戰略的前瞻性陳述。除非另有說明，否則本次電話會議的所有財務披露都將在非 GAAP 基礎上進行。我們告誡您不要過分依賴這些前瞻性陳述，因為它們涉及風險和不確定性，可能導致實際結果與這些陳述預期的結果大相徑庭，正如我們 10-K 報告中的風險因素所述截至 2022 年 6 月 30 日的期間，已向美國證券交易委員會備案。此次電話會議上所做的任何前瞻性陳述都反映了我們截至今天的分析，除法律要求外，我們沒有計劃或義務更新它們。

Now it's my pleasure to turn the call over to Extreme's President and CEO, Ed Meyercord.

現在我很高興將電話轉給 Extreme 的總裁兼首席執行官 Ed Meyercord。

Thank you, Stan, and thank you all for joining us this morning. We had another record quarter, as demand for cloud-driven networking and for Extreme Solutions remains exceptionally strong with good visibility through fiscal year end '23, leading us to raise our full year revenue outlook to the high end of our range.

謝謝你，斯坦，感謝大家今天早上加入我們。我們又創下了一個創紀錄的季度，因為對雲驅動網絡和極端解決方案的需求仍然異常強勁，並且在 23 財年末具有良好的可見性，這使我們將全年收入預期提高到範圍的高端。

Our share gains are evident by a second consecutive quarter of double-digit revenue growth, 17% growth in product revenue, record free cash flow and a sizable backlog. The resiliency of our business combined with a strong execution of our teams and focus on shareholder value continues to position Extreme well for the long-term.

連續第二個季度實現兩位數的收入增長、產品收入增長 17%、創紀錄的自由現金流和大量積壓訂單，這證明了我們的份額增長。我們業務的彈性與我們團隊的強大執行力以及對股東價值的關注相結合，繼續使 Extreme 處於長期有利地位。

The sequential increase in revenue and margins led to continued improvement and our operating model to record levels just shy of 15% operating margin, and we achieved EPS of $0.27 in Q2, up from $0.21 in the year ago quarter. We expect these bottom line earnings trends to continue. Both our fabric and cloud solutions are driving significant differentiation for Extreme, particularly due to our ability to deliver network automation, hyper-segmentation, unmatched security.

收入和利潤率的連續增長導致持續改進，我們的運營模式創下了略低於 15% 的運營利潤率的記錄水平，我們在第二季度實現了 0.27 美元的每股收益，高於去年同期的 0.21 美元。我們預計這些盈利趨勢將繼續下去。我們的架構和雲解決方案正在推動 Extreme 的顯著差異化，特別是由於我們能夠提供網絡自動化、超分段和無與倫比的安全性。

Today, our fabric solutions offer a simple way for customers to tie all the components of their network together, and the branch, campus, data center to the cloud. It removes network complexity, speeds deployments and streamlines operations. The transition to universal products has proven successful, with well over 60% of our bookings now on universal platforms for Wired and Wireless Products. We're on track to achieve this transition by year end calendar '23 with over 90% coverage of our portfolio with the universal platform.

今天，我們的交換矩陣解決方案為客戶提供了一種簡單的方法，可以將其網絡的所有組件連接在一起，並將分支機構、園區、數據中心連接到雲端。它消除了網絡複雜性、加快了部署並簡化了操作。事實證明，向通用產品的過渡是成功的，我們現在有超過 60% 的預訂是在有線和無線產品的通用平台上進行的。我們有望在年底日曆 '23 之前實現這一轉變，通用平台對我們產品組合的覆蓋率超過 90%。

This calendar quarter, we'll be announcing a set of unique innovations, involving ExtremeCloud SD-WAN and our widely deployed Extreme Fabric. These capabilities will enable our customers to improve visibility, management, application performance and security at the edge of the network. This further extends our vision of 1 network, 1 cloud, 1 Extreme over the wide area network with a truly differentiated fabric technology.

本季度，我們將宣布一系列獨特的創新，包括 ExtremeCloud SD-WAN 和我們廣泛部署的 Extreme Fabric。這些功能將使我們的客戶能夠提高網絡邊緣的可見性、管理、應用程序性能和安全性。這進一步擴展了我們通過真正差異化的結構技術在廣域網上實現 1 個網絡、1 個雲、1 個 Extreme 的願景。

We're focused on helping our customers find new ways to deliver better outcomes across their organizations. During the quarter, 44 customers spent more than $1 million with Extreme, up from 37 last quarter, is another signal of how Extreme continues to take share and move up market. The top wins for the quarter included a multinational bank in Hong Kong, where we beat 2 of our largest competitors to modernize the infrastructure for surveillance, digital cornerstone for safety and security.

我們專注於幫助我們的客戶找到新的方法來在他們的組織中取得更好的成果。本季度，有 44 位客戶在 Extreme 上花費超過 100 萬美元，高於上一季度的 37 位，這是 Extreme 如何繼續佔據份額並提升市場的另一個信號。本季度的最大勝利包括香港的一家跨國銀行，我們擊敗了兩家最大的競爭對手，實現了監控基礎設施的現代化，以及安全和安保的數字基石。

After using a competitor for many years, Extreme was able to bid on this project and win. A large school district just outside of Houston was looking to streamline management of its network, which sprawls across 92 buildings and support 60,000 students. Our fabric technology will provide full visibility across the network, simplifying and unifying network management, improving security at every site, and automating network configuration and provisioning to significantly reduce time spent on new deployments.

在使用競爭對手多年後，Extreme 能夠競標併中標該項目。休斯頓郊外的一個大型學區正在尋求簡化其網絡的管理，該網絡遍布 92 座建築物並為 60,000 名學生提供支持。我們的結構技術將提供整個網絡的全面可見性，簡化和統一網絡管理，提高每個站點的安全性，並自動化網絡配置和供應，以顯著減少新部署所花費的時間。

A leading NHS Trust Hospital and Cancer Research Center in London upgraded their networks to continue to offer patients the most modern care. New bandwidth heavy applications, telehealth visits and medical devices are crucial for patient monitoring and require a Wi-Fi 6E fast, reliable, low latency network that could be easily managed by Extreme Cloud IQ. Our competitive position has never been stronger. Given our relative size, even small share gains have a large impact on Extreme's topline.

倫敦一家領先的 NHS 信託醫院和癌症研究中心升級了他們的網絡，以繼續為患者提供最現代的護理。新的帶寬密集型應用、遠程醫療訪問和醫療設備對於患者監測至關重要，並且需要可由 Extreme Cloud IQ 輕鬆管理的快速、可靠、低延遲的 Wi-Fi 6E 網絡。我們的競爭地位從未如此強大。鑑於我們的相對規模，即使是很小的份額增長也會對 Extreme 的收入產生很大影響。

We remain the fastest-growing company in our space. Third-party analysts, industry press and partner community have taken notice and we received numerous accolades and awards for our solutions and service. For the 5th consecutive year, we were named a leader in the Gartner Magic Quadrant for Wired and Wireless Local Area Network Infrastructure. Our innovation, vision and continued execution with solutions like fabric and digital twin were significant factors in our ranking.

我們仍然是我們所在領域發展最快的公司。第三方分析師、行業媒體和合作夥伴社區已經註意到了我們，我們的解決方案和服務獲得了無數讚譽和獎項。我們連續 5 年被評為 Gartner 有線和無線局域網基礎設施魔力像限的領導者。我們的創新、願景和對織物和數字雙胞胎等解決方案的持續執行是我們排名的重要因素。

Our new customer logo wins contributed a higher percentage of our bookings. About half of our new logo wins are coming, because of fatigue and lack of innovation from some of the largest players in the industry. We're taking advantage of these market dislocations and when customers realize, they'll benefit from interoperability between platforms, simpler licensing structures, productivity from Extreme versus our largest competitor, we're quick to capitalize on these opportunities to win new business.

我們的新客戶徽標贏得了我們預訂的更高百分比。由於行業中一些最大的參與者的疲勞和缺乏創新，我們大約有一半的新徽標獲勝。我們正在利用這些市場錯位，當客戶意識到他們將受益於平台之間的互操作性、更簡單的許可結構、Extreme 與我們最大的競爭對手相比的生產力時，我們會迅速利用這些機會贏得新業務。

More customers and partners choose Extreme, because of our ability to offer unlimited end-to-end network that can be managed within a single-cloud platform. Customers also love our universal hardware that offers choice of both cloud-based and on-premise deployments. As product lead times continue to improve, we expect our share gains to accelerate.

越來越多的客戶和合作夥伴選擇 Extreme，因為我們能夠提供可以在單一云平台內管理的無限端到端網絡。客戶還喜歡我們的通用硬件，它提供了基於雲的部署和本地部署的選擇。隨著產品交貨時間的不斷縮短，我們預計我們的份額增長將加速。

Last quarter, we strengthened our go-to-market organization by appointing Pete Brant as Senior Vice President of U.S. Sales. Pete is a proven sales leader focused on taking share and building SaaS organizations coming from leading networking and security companies, such as F5 and Fortinet.

上個季度，我們任命 Pete Brant 為美國銷售高級副總裁，加強了我們的上市組織。 Pete 是一位久經考驗的銷售領導者，專注於從領先的網絡和安全公司（例如 F5 和 Fortinet）獲取份額和建立 SaaS 組織。

We ended Q2 with ARR growth of 29% year-over-year, while SaaS deferred revenue grew at 38% year-over-year. Our innovative cloud solutions are pulling through product sales and we believe the level of organic subscription growth we're seeing is sustainable. In addition, the improvement in supply chain, our ability to deliver products, most notably Wireless LAN this quarter supported a strong pull-through of software subscription for the next several years.

我們在第二季度末的 ARR 同比增長 29%，而 SaaS 遞延收入同比增長 38%。我們創新的雲解決方案正在推動產品銷售，我們相信我們看到的有機訂閱增長水平是可持續的。此外，供應鏈的改善、我們交付產品的能力，尤其是本季度的無線局域網，支持了未來幾年軟件訂閱的強勁增長。

On the supply chain side, our ability to pull in components enabled us to achieve revenue upside, which we believe is sustainable into the second half of the year. As a result, we are raising our revenue outlook to the high-end of our prior 10% to 15% guidance range. We continue to be laser-focused on tactical execution to meet our customer’s needs.

在供應鏈方面，我們引入組件的能力使我們能夠實現收入增長，我們相信這將持續到下半年。因此，我們將收入前景提高到之前 10% 至 15% 指導範圍的高端。我們繼續專注於戰術執行以滿足客戶的需求。

This quarter alone, we qualified an additional 37 component suppliers and significantly reduced our parts shortages. Based on all the actions we've taken with our supply chain over the past year, we now have visibility and confidence that the ramp of our product deliveries will continue to improve and reduce lead times.

僅本季度，我們就新增了 37 家零部件供應商，並顯著減少了我們的零部件短缺情況。基於我們在過去一年中對供應鏈採取的所有行動，我們現在可以預見並相信我們的產品交付速度將繼續改善並縮短交貨時間。

With a strong outlook for bookings growth and the gradual improvement of supply, we expect backlogs to remain relatively stable for the next several quarters. We're in the beginning stages of an accelerated wave of product shipments and revenue growth over multiple quarters.

鑑於預訂量增長的強勁前景和供應的逐步改善，我們預計未來幾個季度的積壓量將保持相對穩定。我們正處於多個季度產品出貨量和收入增長加速浪潮的開始階段。

The majority of our backlog consists of the latest generation universal products that pull-through subscription and service bookings. So when our backlog shifts, it will also unleash subscription and maintenance services revenues over the next several years. Throughout calendar '23, we have several universal product innovations coming to market that will drive better outcomes for our customers.

我們的大部分積壓訂單包括最新一代的通用產品，這些產品可以實現訂閱和服務預訂。因此，當我們的積壓工作轉移時，它也將在未來幾年釋放訂閱和維護服務收入。在整個 23 年日曆中，我們有幾項通用產品創新進入市場，它們將為我們的客戶帶來更好的結果。

In addition to the 5720 switches designed for higher data throughput, such as our Wi-Fi 6E access points will be coming to market with new industrial switches for hardened environments and smart city deployments. New distribution switches to support the higher power over Ethernet and density requirements of Wi-Fi 6E and Wi-Fi 7 in the future. Several new datacenter and core products will also launched throughout the year.

除了專為更高數據吞吐量而設計的 5720 交換機外，我們的 Wi-Fi 6E 接入點等將與適用於強化環境和智慧城市部署的新型工業交換機一同上市。新的分佈式交換機支持未來更高的以太網功率和 Wi-Fi 6E 和 Wi-Fi 7 的密度要求。一些新的數據中心和核心產品也將在全年推出。

Lastly, I want to welcome our Interim CFO, Cristina Tate to the call. Cristina is a proven and highly respected leader at Extreme, and I expect a smooth transition as we enter this new growth phase. Remi accepted a new opportunity with a privately owned software company and will stay on with us through the middle of next month to oversee the transition. He was a great partner and leader, and has set the company up for success.

最後，我想歡迎我們的臨時首席財務官克里斯蒂娜·泰特 (Cristina Tate) 來電。 Cristina 是 Extreme 一位久經考驗且備受尊敬的領導者，我希望在我們進入這個新的增長階段時能夠順利過渡。 Remi 接受了一家私營軟件公司的新機會，並將在下個月中旬繼續與我們一起監督過渡。他是一位出色的合作夥伴和領導者，並為公司的成功奠定了基礎。

With that, I will turn the call over to Cristina to cover the financials.

有了這個，我會把電話轉給克里斯蒂娜來處理財務問題。

Thanks, Ed. Q2 results highlight solid execution by the team, as well as an improvement in the supply chain environment. Our ability to deliver product resulted in record revenue and continued the trend of double-digit revenue growth we have achieved in 7 of the last 8 quarters. Our SaaS ARR continued to rise. We improved our margins sequentially, and we generated record cash flow, which enabled us to repurchase 2.6 million shares of our common stock.

謝謝，埃德。第二季度的結果突出了團隊的紮實執行以及供應鏈環境的改善。我們交付產品的能力帶來了創紀錄的收入，並延續了我們在過去 8 個季度中的 7 個季度實現的兩位數收入增長趨勢。我們的 SaaS ARR 繼續上升。我們連續提高了利潤率，產生了創紀錄的現金流，這使我們能夠回購 260 萬股普通股。

Our second quarter revenue of $318.3 million grew 13% year-over-year and 7% quarter-over-quarter, which was above the high end of our expectations entering the quarter. With a product book-to-bill ratio of 0.9x for the quarter, our backlog stands at $542 million, equivalent to 2.5 quarters of product revenue. The slight decrease in backlog primarily reflects accelerated product shipments.

我們第二季度的收入為 3.183 億美元，同比增長 13%，環比增長 7%，高於我們進入本季度的預期上限。本季度產品訂單出貨率為 0.9 倍，我們的積壓訂單為 5.42 億美元，相當於產品收入的 2.5 個季度。積壓量的輕微減少主要反映了產品出貨量的加速。

Product revenue grew a healthy 17% year-over-year and 8% sequentially, attributable to both campus switching and Wireless LAN, partially offset by a decline in data center. The ongoing loosening of the supply of access points resulted in Wireless LAN revenue accounting for 34% of product revenue, up from 30% in Q1.

產品收入同比健康增長 17%，環比增長 8%，這歸因於園區交換和無線局域網，部分被數據中心的下滑所抵消。接入點供應的持續放鬆導致無線局域網收入佔產品收入的 34%，高於第一季度的 30%。

Subscription bookings grew by 30% year-over-year, in line with the long-term guidance of 25% to 35% growth provided at Investor Day last May. SaaS ARR grew 29% to $115 million, up from $89 million in the year ago quarter. Subscription deferred revenue was up 38% year-over-year and 9% quarter-over-quarter to $187 million.

訂閱預訂量同比增長 30%，符合去年 5 月投資者日提供的 25% 至 35% 增長的長期指導。 SaaS ARR 增長 29% 至 1.15 億美元，高於去年同期的 8900 萬美元。訂閱遞延收入同比增長 38%，環比增長 9%，達到 1.87 億美元。

Q2 earnings per share was $0.27 above the high end of our guidance entering the quarter. Revenue on a geographic basis once again reflects the timing of product shipments to our distributors across the regions. Regarding our bookings performance, recall that we experienced very strong demand in Q1, resulting from pull-ins of deals from Q2, ahead of the list price increases as of October 1.

第二季度每股收益比我們進入本季度的指引的上限高出 0.27 美元。按地域劃分的收入再次反映了向我們跨地區的分銷商發貨的時間。關於我們的預訂表現，回想一下我們在第一季度經歷了非常強勁的需求，這是由於第二季度的交易拉動，在 10 月 1 日的標價上漲之前。

Then during Q2, we saw less of a year-end budget flush than we normally see and it's a tight supply environment. This resulted in a slight decrease in bookings in Q2. However, for the first half as a whole, bookings grew low-single digits year-over-year. As a reminder, last year in the first half, our bookings grew in the mid-teens year-over-year. From a vertical standpoint, our mix did not changed meaningfully this quarter, with government and education accounting for over 40% of the total, healthcare at a bit over 10%, manufacturing at approximately 10%, and retail, transportation and logistics approaching 10%.

然後在第二季度，我們看到年終預算激增的情況比往常少，而且供應環境緊張。這導致第二季度的預訂量略有下降。然而，就整個上半年而言，預訂量同比增長低個位數。提醒一下，去年上半年，我們的預訂量同比增長了十幾歲。從垂直的角度來看，本季度我們的結構沒有發生重大變化，政府和教育佔總數的 40% 以上，醫療保健略高於 10%，製造業約佔 10%，零售、運輸和物流接近 10% .

Services and subscription revenue was $94.9 million, up 6% year-over-year. This growth was largely driven by the strength of cloud subscription, up 33% year-over-year. Total Q2 recurring revenue, including maintenance, managed services and subscriptions was at $88 million, or 28% of total company revenue. The growth of cloud subscriptions and maintenance drove the total deferred revenue to $446 million, up 19% from the year ago quarter and 5% sequentially.

服務和訂閱收入為 9490 萬美元，同比增長 6%。這一增長主要是由雲訂閱的力量推動的，同比增長 33%。第二季度的經常性總收入（包括維護、託管服務和訂閱）為 8800 萬美元，占公司總收入的 28%。雲訂閱和維護的增長推動總遞延收入達到 4.46 億美元，比去年同期增長 19%，環比增長 5%。

Our gross margin came in at 58.5%, up 90 basis points sequentially and 30 basis points from the year ago quarter. This was mainly attributable to our product gross margin, which benefited from higher revenue and an improvement in supply chain and distribution costs, partially offset by a change in the product mix with higher contribution from Wireless. Our services and subscription gross margin was at 67% in Q2, consistent with both the prior year and prior quarter periods.

我們的毛利率為 58.5%，環比上升 90 個基點，比去年同期上升 30 個基點。這主要歸因於我們的產品毛利率，這得益於更高的收入以及供應鍊和分銷成本的改善，部分被產品組合的變化所抵消，無線的貢獻更高。我們的服務和訂閱毛利率在第二季度為 67%，與去年和上一季度一致。

Q2 operating expenses were $139 million, up from $127 million in the year ago quarter and from $135 million in Q1 '23, reflecting higher R&D investment and sales and marketing expense to support higher revenue growth. Total operating expense as a percentage of revenue was 43.7%, down 1.7 percentage points versus last quarter. All-in-all, our operating margin was 14.9%, the highest level ever achieved, up from 13.1% in the year ago quarter and 12.1% in Q1 '23.

第二季度運營費用為 1.39 億美元，高於去年同期的 1.27 億美元和 23 年第一季度的 1.35 億美元，反映出更高的研發投資以及銷售和營銷費用以支持更高的收入增長。總運營費用佔收入的百分比為 43.7%，較上一季度下降 1.7 個百分點。總而言之，我們的營業利潤率為 14.9%，是有史以來的最高水平，高於去年同期的 13.1% 和 23 年第一季度的 12.1%。

This quarter, we enjoyed record free cash flow of $67.5 million, driven by the strong increase in our EBITDA, as well as a reduction in operating working capital due primarily to strong collections. Our cash conversion cycle rose 5 days sequentially to 24 days. This strong cash flow enabled us to complete $50 million worth of share buybacks, while also reducing our net debt by $14 million to $59.5 million.

本季度，我們的自由現金流達到創紀錄的 6750 萬美元，這主要得益於 EBITDA 的強勁增長，以及主要由於收款強勁而導致的運營營運資金減少。我們的現金周轉週期連續增加了 5 天，達到 24 天。這種強勁的現金流使我們能夠完成價值 5000 萬美元的股票回購，同時還將我們的淨債務減少 1400 萬美元至 5950 萬美元。

Now turning to guidance. As we enter the second half, our confidence in the revenue outlook is supported by our product backlog of $542 million, our services and subscription deferred revenue balance of $446 million, as well as a product pipeline that is up double-digits year-over-year. We continue to expect that the reduction in expedite fees and shipping costs, combined with the full impact of our recent pricing actions will lead to a continued progressive recovery in gross margin throughout fiscal year '23.

現在轉向指導。隨著我們進入下半年，我們對收入前景的信心得到了 5.42 億美元的產品積壓、4.46 億美元的服務和訂閱遞延收入餘額以及同比增長兩位數的產品線的支持。年。我們繼續預計，加快費用和運輸成本的降低，加上我們最近定價行動的全面影響，將導致整個 23 財年毛利率持續逐步回升。

Against this backdrop, we expect for Q3 revenue to be in the range of $315 million to $325 million, gross margin to be in the range of 58% to 60%, operating expenses to be in the range of $140 million to $145 million, and earnings to be in the range of $31.1 million to $38.4 million, or $0.23 to $0.29 per diluted share. We expect to cross the 60% gross margin threshold in Q4. For full fiscal year '23, we expect revenue growth towards the high end of our 10% to 15% outlook, with an operating margin in the mid-teens.

在此背景下，我們預計第三季度收入將在 3.15 億美元至 3.25 億美元之間，毛利率將在 58% 至 60% 之間，營業費用將在 1.4 億美元至 1.45 億美元之間，以及收益將在 3110 萬美元至 3840 萬美元之間，或每股攤薄收益 0.23 美元至 0.29 美元。我們預計第四季度將突破 60% 的毛利率門檻。對於整個 23 財年，我們預計收入增長將達到 10% 至 15% 預期的高端，營業利潤率將達到十幾歲左右。

With that, I will now turn it over to the operator to begin the question-and-answer session.

有了這個，我現在將它交給接線員開始問答環節。

(Operator Instructions) Our first question comes from Alex Henderson with Needham & Company.

（操作員說明）我們的第一個問題來自 Needham & Company 的 Alex Henderson。

I knew there had to be somebody behind Remi doing all the work, so welcome to the call Cristina.

我知道必須有人在雷米身後做所有的工作，所以歡迎打電話給克里斯蒂娜。

Thank you.

謝謝。

It could have been just for Remi. I knew it had to be somebody else. I was hoping you could talk a little bit more in-depth about your commentary around backlog. I think you had said that you thought it would be up slightly in the December quarter, but obviously on a lower revenue guide. So it sounds like the overall orders were actually a little bit ahead of forecast or ahead of what would have built a little bit of backlog. But I think you'd also said that the March quarter, you would expect it to be flat to down here and then the June quarter down a little bit more. So the comment about the backlog relatively stable implies somewhat of a change in the rate of backlog usage bookings would have to be or orders would have to be a little bit stronger than what you had suggested, given the higher comments. So am I reading that correctly that you're actually a little bit more confident on new orders based off of what you said about the flatness of the backlog going into the June quarter?

它可能只是為了雷米。我知道一定是別人。我希望你能更深入地談談你對積壓的評論。我想你曾說過你認為它會在 12 月季度略有上升，但顯然是在較低的收入指導下。因此，聽起來總體訂單實際上比預期提前了一點，或者比積壓的訂單提前了一點。但我想你也說過 3 月的季度，你會預計它會持平到這裡下降，然後 6 月的季度會下降一點。因此，關於積壓相對穩定的評論意味著積壓使用預訂率必須有所變化，或者訂單必須比您建議的要強一點，因為評論較高。因此，根據您所說的進入 6 月季度的積壓訂單持平情況，我是否正確地理解了您實際上對新訂單更有信心？

Alex, this is Ed and then Cristina jumps in behind if you want to add another comment, but I think that's right.

亞歷克斯，我是埃德，如果你想添加另一條評論，克里斯蒂娜會跳到後面，但我認為這是正確的。

So this is, for us, if we look at what happened as Cristina mentioned that, first half of last year we grew 16% in the first quarter and the first half of the year, and then we were up low-single digits in the first half of this year and then a lot of it got pulled-in to the first quarter. But our supply chain teams have done a great job. We talked about all the work that's going on behind the scenes. So we're seeing it loosen. So we've seen an acceleration of the release of products. And at the end of the day, we want to take care of our customers with some of that older aged backlog that's out there. So we took advantage of that.

所以，對我們來說，如果我們看看發生了什麼，就像克里斯蒂娜提到的那樣，去年上半年我們在第一季度和今年上半年增長了 16%，然後我們在今年上半年，然後很多都被拖到了第一季度。但是我們的供應鏈團隊做得很好。我們談到了幕後進行的所有工作。所以我們看到它鬆動了。所以我們看到了產品發布的加速。歸根結底，我們希望通過一些較舊的積壓來照顧我們的客戶。所以我們利用了這一點。

The second half for us, as you know, we see a lot of demand, and we're really confident and our teams are very confident of that demand. So we have booking strength we see in the second half of the year, and that should hold that backlog -- that should hold the backlog very, very stable through the second half of the year.

下半年，如你所知，我們看到了很多需求，我們非常有信心，我們的團隊對這種需求非常有信心。因此，我們在今年下半年看到了預訂強度，這應該會保持積壓——這應該會在今年下半年非常、非常穩定地保持積壓。

Yes. Just to be clear, that's product backlog you're talking about, right?

是的。需要說明的是，您說的是產品積壓，對嗎？

That's correct.

這是正確的。

So that also results in an increase in your services backlog as a result of the releases of services on those bookings.

因此，由於這些預訂的服務發布，這也會導致您的服務積壓增加。

It does. I mean, the other thing that's happened here is that we have and you can see it from a bookings perspective, we talked about universal hardware platforms and those universal hardware platforms typically will have service attach and always subscription attach. So we have a backlog of subscription and services that will be released as we release the product backlog.

確實如此。我的意思是，這裡發生的另一件事是我們有，您可以從預訂的角度來看，我們談到了通用硬件平台，這些通用硬件平台通常會附加服務並始終附加訂閱。所以我們有訂閱和服務的積壓，將在我們發布產品積壓時發布。

Second question I have for you is on the inventory side of things. There is certainly a lot of costs that were inflated over the last year as a result of the supply constraints. When I look at your inventory up considerably over the last 2 years, is there a -- some higher priced inventory in there that needs to be worked down before the full leverage of the upside to universal and lower parts costs plays through? How do we think about the improved availability causing that inventory to come down driving up cash flow?

我要問你的第二個問題是關於庫存方面的問題。由於供應限制，去年肯定有很多成本被誇大了。當我查看您的庫存在過去 2 年中大幅增加時，是否有一些價格較高的庫存需要在充分發揮通用和降低零件成本的優勢之前進行處理？我們如何看待導致庫存下降從而推動現金流增加的可用性提高？

Yes. Well we -- yes, at a high level, we have -- obviously the older inventory shipping out, newer inventory coming in, which is going to come in at the higher COGS and we are building up supply. And the inventory is correlated to getting more supply and we're anticipating getting more supply. So I think, there is a correlation there, and maybe I'll ask Cristina to comment overall inventory.

是的。那麼我們 - 是的，在高水平上，我們 - 顯然，舊庫存出貨，新庫存進入，這將以更高的銷貨成本進入，我們正在增加供應。庫存與獲得更多供應相關，我們預計將獲得更多供應。所以我認為，那裡存在相關性，也許我會請克里斯蒂娜評論整體庫存。

Yes. So at the inventory, I see is another sign of the improvement in the supply chain. So we were able to get more parts in and we're able to have more finished goods. So I think it will definitely lead to being able to ship more of the backlog. And that's a good sign from the supply chain.

是的。所以在庫存方面，我看到的是供應鏈改善的另一個跡象。所以我們能夠獲得更多的零件，並且我們能夠擁有更多的成品。所以我認為這肯定會導致能夠運送更多的積壓訂單。這是供應鏈的一個好兆頭。

Yes. The question really is on the cost of goods sold, relative to the inventory that was maybe inflated part costs to it. Is that in inventory and therefore has to be worked through before you get the benefit of falling parts costs as a result of improved supply chain?

是的。問題實際上是關於所售商品的成本，相對於可能誇大了零件成本的庫存。這是否在庫存中，因此在您因改進供應鏈而獲得零件成本下降的好處之前必須解決？

So the benefit that we'll see in our supply chain cost is really related to those incremental expedite fees and higher logistics costs that we've experienced through this challenging supply chain environment. The component costs themselves, we have seen inflation of that and we're not seeing that yet come back down.

因此，我們將在供應鏈成本中看到的好處實際上與我們在這個充滿挑戰的供應鏈環境中經歷的那些增量加速費用和更高的物流成本有關。組件成本本身，我們已經看到它的通貨膨脹，但我們還沒有看到它回落。

I see.

我懂了。

Yes. And Alex, I think another consideration is that, there are 2 other key things that happened. So as a percentage of mix, Wireless was up in the quarter. And so, as the Wireless mix goes up, that tends to have a little bit of a drag on gross margin, as you know, campus switching is slightly higher margin in terms of mix. And I think underlying your question is also timing of when we sell out some of the aged inventory that we took orders before some of the price increases, and so that will help us as we move forward. I think that's what you were underlying your question there. As we move forward with newer orders that we have taken from customers, they will reflect more of the price increase and that will create a tailwind for gross margin going forward.

是的。亞歷克斯，我認為另一個考慮因素是，還有另外兩件重要的事情發生了。因此，作為組合的百分比，無線在本季度有所上升。因此，隨著無線組合的增加，這往往會對毛利率產生一點拖累，正如你所知，校園交換在組合方面的利潤率略高。而且我認為你的問題的根本還在於我們何時售罄我們在一些價格上漲之前訂購的一些陳舊庫存的時間，這將有助於我們前進。我認為這就是你在那裡提出問題的基礎。隨著我們從客戶那裡獲得新訂單，它們將反映更多的價格上漲，這將為未來的毛利率創造順風。

I see. So what are you assuming parts costs are exiting the year above normal?

我懂了。那麼你假設零件成本高於正常水平的年份是多少？

So parts costs are roughly, I would say 2 percentage points to 3 percentage points above the normal percentage of revenue, as part of the standard COGS. And right now, we're not seeing -- we're basically expecting that trend to stay flat and then come down progressively through the next, I would say, 3 to 4 quarters.

因此，作為標準 COGS 的一部分，零件成本大致比正常收入百分比高 2 到 3 個百分點。現在，我們還沒有看到——我們基本上預計這種趨勢會保持平穩，然後在接下來的 3 到 4 個季度中逐漸下降。

We have a question from Eric Martinuzzi with Lake Street Capital.

Lake Street Capital 的 Eric Martinuzzi 向我們提出了一個問題。

Yes. Congrats on the strong quarter. My question has to do with the FY ‘24 language. I want to make sure, I'm understanding this. I think last quarter you talked about FY ‘24 growth in the range of 15% to 17% and this quarter at least in the press release the languages accelerated growth, so wanted to know if that 15% to 17% is still what you're talking about when you say accelerated growth or if it's something different?

是的。祝賀強勁的季度。我的問題與 FY ‘24 語言有關。我想確定一下，我理解這一點。我想上個季度你談到 FY'24 增長在 15% 到 17% 之間，而本季度至少在新聞稿中語言加速增長，所以想知道 15% 到 17% 是否仍然是什麼當你說加速增長時，你是在談論什麼，或者它是否有所不同？

Yes, Eric. I think at this stage of the game, we'll hang on to the long-term CAGR that we put out there as far as 14% to 17%. And so, it's that sort of mid to high teens number and we're very confident of that number going into '24. And the call here given the acceleration of supply and what we've seen here, so the combination of strength of demand that we're forecasting as far as bookings, as well as the supply release we're calling the high end of that 10% to 15% range for the second half of the year, but we do expect it to go up in fiscal '24.

是的，埃里克。我認為在遊戲的這個階段，我們將堅持我們提出的 14% 到 17% 的長期復合年增長率。因此，這是一個中高青少年的數字，我們對這個數字進入 24 年非常有信心。考慮到供應的加速以及我們在這裡看到的情況，所以我們預測的需求強度與預訂的結合，以及我們稱之為 10 高端的供應釋放今年下半年 % 到 15% 的範圍，但我們確實預計它會在 24 財年上升。

Okay. And then you talked about the health of the pipeline. I was wondering if you could take that down to your geographic levels and talk about USA, EMEA and APAC pipeline?

好的。然後你談到了管道的健康狀況。我想知道您是否可以將其降低到您的地理級別並談談美國、歐洲、中東和非洲和亞太地區的管道？

It's interesting, Eric. It's strong across the board. We've been getting a lot of questions about, are we seeing softness? We've heard other companies talking about it kind of macro-tech in general. So we've drilled down and we've been doing RD level calls across all regions. And interestingly across the board globally, our teams are calling strength and it shows up in terms of the leadership and then the directors and literally our direct sellers are rolling up and what they're calling.

這很有趣，埃里克。它在各方面都很強大。我們收到了很多關於我們是否看到了柔軟度的問題？我們聽說其他公司普遍談論這種宏觀技術。因此，我們進行了深入研究，並一直在所有地區進行研發級別的電話會議。有趣的是，在全球範圍內，我們的團隊都在呼喚力量，它體現在領導層，然後是董事和我們的直銷員正在聚集起來，他們在呼喚什麼。

In terms of the pipeline and our funnel analytics, we've got very good visibility and we're getting much better at calling numbers and we have this AI tool that we use that helps us call it. So I'm going to call it across the Board. There's not specific strength or weakness to call out, other than the recovery in APAC. Asia-Pacific and some of our markets there have been hit by currency, other issues and that -- we felt that this quarter, but the teams have a plan and we have new leadership in markets and we're expecting a really strong recovery in Asia Pacific.

在管道和我們的漏斗分析方面，我們有很好的可見性，我們在呼叫號碼方面做得更好，我們有我們使用的人工智能工具來幫助我們呼叫它。所以我將全面調用它。除了亞太地區的複甦之外，沒有具體的優勢或劣勢可以指出。亞太地區和我們那裡的一些市場受到了貨幣和其他問題的打擊，而且 - 我們認為本季度，但團隊有一個計劃，我們在市場上有新的領導，我們預計會出現非常強勁的複蘇亞太地區。

Our next question comes from Mike Genovese with Rosenblatt Securities.

我們的下一個問題來自 Rosenblatt Securities 的 Mike Genovese。

So there was a lot of positive commentary on the subscription and SaaS revenue growth, but the subscription growth went down to 30 from 60 in the quarter before. So can we just get more color on whether tough comps or timing issues, and what do you expect in the second half of the year on that subscription growth?

因此，對訂閱和 SaaS 收入增長有很多正面評論，但訂閱增長從前一季度的 60 下降到 30。那麼我們能否就艱難的補償或時間問題獲得更多的顏色，以及您對今年下半年訂閱增長的期望是什麼？

Yes. So, thanks, Mike. Yes, subscription growth, if we look at quarter-over-quarter subscription growth, year-over-year subscription growth, the trends have been somewhat consistent, what we've call is a long-term range where we've said, you're going to see a 30% to 40% subscription growth. We have a lot of -- as you're well aware, we have a lot of our subscription in backlog. So it's a function of the timing of the release of backlog, and it's the timing of the release of backlog. And then, as you know, when we release subscription, you get -- there is a delay in terms of how you recognize revenue because of the accrual. So one of the things Cristina commented on, was the 38% growth in terms of the accrued subscription revenue, deferred revenue and then we think you'll see that rollout, but the long term model is, I'm sorry, 25% to 35% and that's the normalized level that, that I know we put out for our long-term guidance. And 33% fall is going to right in the middle there, but we would expect that to continue. Cristina, I don't know if you want to add other color to that?

是的。所以，謝謝，邁克。是的，訂閱增長，如果我們看一下季度環比訂閱增長、同比訂閱增長，趨勢在某種程度上是一致的，我們所說的是我們所說的長期範圍，你訂閱量將增長 30% 到 40%。我們有很多 - 正如您所知，我們有很多訂閱積壓。所以它是積壓發佈時間的函數，它是積壓發布的時間。然後，正如你所知，當我們發布訂閱時，你會得到 - 由於應計費用，你確認收入的方式有所延遲。因此，克里斯蒂娜評論的其中一件事是應計訂閱收入、遞延收入增長了 38%，然後我們認為你會看到這種推出，但長期模型是，對不起，25% 到35%，這是標準化水平，據我所知，這是我們為長期指導而提出的。 33% 的跌幅就在中間，但我們預計這種情況會持續下去。克里斯蒂娜，我不知道你是否想給它添加其他顏色？

Yes. It is in line with our guidance, long-term guidance. And so, that is according to expectations and there is a bit of a timing with regards to attached product as well. So some of our subscription bookings are attached to wireless bookings and so, there will be a little bit of fluctuation quarter-to-quarter due to that.

是的。它符合我們的指導，長期指導。因此，這是符合預期的，附加產品也有一些時間安排。因此，我們的一些訂閱預訂與無線預訂相關聯，因此，每個季度都會有一些波動。

Okay. Great. And then I know this is hard to call out at this time and make an accurate forecast, but in terms of fiscal '24 gross margins versus fiscal '23 gross margins, I'd love to get your thoughts on, how -- roughly how many points of improvement that supply chain and other factors like software mix could drive in the gross margin for '24?

好的。偉大的。然後我知道現在很難說出來並做出準確的預測，但就 24 財年毛利率與 23 財年毛利率而言，我很想听聽你的想法，如何 - 大致如何供應鍊和軟件組合等其他因素可以推動 24 世紀毛利率的許多改進點？

Yes. I'll take a shot at this Mike, and then open it up for the rest of the team, but we continue to see the step function. We are seeing a slightly higher concentration when we look at mix. Wireless comes in with a lower gross margin, then campus switching and data center switching, certainly. And then because of the strength of product that we're seeing, we wind up with more product mix, which has lower gross margin than our subscription and service revenue. So as a result, that's why we've tempered our outlook for the rest of the year. But we're very confident and crossing over that 60% gross margin number as we head into our fourth quarter of this year and we expect a step function to continue into fiscal '24.

是的。我會在這個 Mike 上試一試，然後為團隊的其他成員打開它，但我們會繼續看到階躍函數。當我們查看混合時，我們看到濃度略高。無線的毛利率較低，其次是園區交換和數據中心交換。然後由於我們看到的產品實力，我們最終擁有更多的產品組合，其毛利率低於我們的訂閱和服務收入。因此，這就是我們調整今年剩餘時間前景的原因。但我們非常有信心，並在進入今年第四季度時超過 60% 的毛利率數字，我們預計階梯功能將持續到 24 財年。

Exactly. We expect to hit 60% in Q4. We've seen a gradual progressive improvement in our gross margin throughout fiscal year '23. So roughly about a percentage -- 0.5 percentage point to 1 percentage point of improvement in each quarter. And we expect that trend to continue in fiscal year '24. I mentioned that unusual or an inflated costs related to the supply chain environments such as expedite fees, and higher than normal freight costs, we expect those to gradually come down and continue to come down through FY '24. So roughly, I would say that we expect gross margin to improve roughly 3 points to 4 points by the end of Q2 -- fiscal year '24.

確切地。我們預計第四季度將達到 60%。在整個 23 財年，我們看到毛利率逐步提高。所以大概是一個百分比——每個季度 0.5 個百分點到 1 個百分點的改進。我們預計這一趨勢將在 24 財年繼續。我提到過與供應鏈環境相關的不尋常或膨脹的成本，例如加急費，以及高於正常的運費成本，我們預計這些成本將逐漸下降，並在 24 財年繼續下降。所以粗略地說，我想說我們預計到第二季度末 - 24 財年毛利率將提高大約 3 個百分點至 4 個百分點。

We have a question from Greg Mesniaeff with West Park Capital.

West Park Capital 的 Greg Mesniaeff 提出了一個問題。

Yes. Congrats on a good quarter. I have an R&D question for you guys. As you look at your product mix, and you look at component costs, the fact that they've gone up and they've remained sticky. What kind of initiatives are you -- do you have in place right now to basically engineer out some of the hardware component costs, particularly in switching and campus switching in areas where you know, it's kind of component heavy, if you will? Any insights on that would I think be kind of helpful to see how you can essentially move beyond some of the higher component costs that go into the products and the switches?

是的。祝賀一個好的季度。我有一個研發問題要問你們。當你查看你的產品組合時，你會查看組件成本，事實上它們已經上升並且仍然很粘。你有什麼樣的舉措——你現在是否已經制定了一些硬件組件成本，特別是在你知道的區域的交換和園區交換中，如果你願意的話，它有點重？我認為對此的任何見解都有助於了解您如何從根本上超越產品和交換機中的一些更高的組件成本？

Yes. Well, Greg, thanks for the question. I'll lead off. One of the things that I mentioned is that, during the quarter that we qualified an additional 37 component suppliers. And there is a question of our resiliency around availability and supply chain constraints. And then there's also the question around how we drive our gross margin through the qualification of new suppliers and new components and new parts.

是的。好吧，格雷格，謝謝你的提問。我先走。我提到的一件事是，在本季度，我們對另外 37 家組件供應商進行了鑑定。還有一個問題是我們在可用性和供應鏈限制方面的彈性。然後還有關於我們如何通過新供應商和新組件和新零件的資格來提高毛利率的問題。

One of the lessons learned for us is that, we have the ability to enhance this qualification process and the qualification process that was solely focused on availability will be turned towards driving and improving gross margins as we go forward. So it's a good question. I can tell you, it's something that we're very focused on.

我們吸取的教訓之一是，我們有能力加強這一資格認證流程，並且隨著我們的前進，僅專注於可用性的資格認證流程將轉向推動和提高毛利率。所以這是個好問題。我可以告訴你，這是我們非常關注的事情。

Great. Also did you guys give a DSO number for the quarter?

偉大的。你們也給了這個季度的 DSO 編號嗎？

Yes. Greg that should be in the presentation. And if you look there, we talked about DSO in the 44 day range, it's on Page 14 of our...

是的。 Greg 應該在演示文稿中。如果你看那裡，我們討論了 44 天範圍內的 DSO，它在我們的第 14 頁......

And our next question comes from Dave Kang with B. Riley.

我們的下一個問題來自 Dave Kang 和 B. Riley。

Just my first question is on your key verticals, I assume there is still positive. Any verticals that is turning negative?

我的第一個問題是關於你的關鍵垂直領域，我認為仍然是積極的。有哪些垂直行業正在轉為負面？

Dave, I think we have -- yes, the one area which for us is a small percentage of our business, but you have seen some softness in service provider. I think you've probably heard that more broadly in the marketplace. We have some very targeted service provider customers and through the quarter, we think that some of the capital spending programs with some of the larger end-users has slowed down a bit. That being said, as we forecast the second half of the year, we're seeing healthier demand coming from our service provider team, in terms of the call for the second half. But that would be the one to call-out, otherwise, I would say, relative strength for us.

戴夫，我認為我們有——是的，對我們來說，一個領域只占我們業務的一小部分，但你已經看到服務提供商有些疲軟。我想您可能在市場上更廣泛地聽說過這一點。我們有一些非常有針對性的服務提供商客戶，並且在整個季度中，我們認為一些較大的最終用戶的一些資本支出計劃有所放緩。話雖這麼說，正如我們預測的下半年，我們看到我們的服務提供商團隊對下半年的需求更加健康。但那將是一個需要大聲疾呼的人，否則，我會說，我們的相對實力。

The other high-level comment that I would make is that, we are in a position from being a somewhat smaller player with a lot of other larger players in the industry for us to take share. So in some of the verticals and we'll be coming out and announcing some wins that we've got, we've been able to win significant share in some of these markets, where there's a meaningful share shift that sort of transcends what's going on and maybe more the general macro sense, which will be coming out with. So, I would say in general, pretty steady across the board in terms of the verticals and service provider, which was soft. With our very focused applications, we see strengthening from where we were in the first half through the second half.

我要發表的另一個高級別評論是，我們處於一個相對較小的參與者的位置，行業中有許多其他較大的參與者供我們分享。因此，在某些垂直領域，我們將站出來並宣布我們已經取得的一些勝利，我們已經能夠在其中一些市場中贏得重要份額，這些市場發生了有意義的份額轉移，這在某種程度上超越了正在發生的事情關於，也許更多的是一般的宏觀意義，這將隨之而來。所以，我想說的是，就垂直行業和服務提供商而言，總體上相當穩定，這是軟的。通過我們非常專注的應用程序，我們看到從上半年到下半年的情況有所加強。

And speaking of service providers on Ericsson, they talked about the 5G market a little bit choppy this year, especially first half. Do you still expect to achieve your target of $100 million in 5G, despite Ericsson's comments?

談到愛立信的服務提供商，他們談到今年 5G 市場有點波動，尤其是上半年。儘管有愛立信的評論，您是否仍期望在 5G 方面實現 1 億美元的目標？

We do. We still see strength. We don't think 5G is going away. We think there is a pause with some of the buyers, as they're tightening their budget, but the long-term opportunity is a resounding, yes. The service providers are going to upgrade their infrastructure. And fortunately, we're in a very strong position as part of that infrastructure upgrade. And so, we think that's the case. The other thing is that, they are more with Ericsson, they have more service providers in the queue. So in terms of the number of proof-of-concepts and then proof-of-concepts turning into a meaningful go-live launches, that funnel continues to build nicely.

我們的確是。我們仍然看到了力量。我們認為 5G 不會消失。我們認為一些買家正在暫停，因為他們正在收緊預算，但長期機會是一個響亮的，是的。服務提供商將升級他們的基礎設施。幸運的是，作為基礎設施升級的一部分，我們處於非常有利的地位。所以，我們認為是這樣的。另一件事是，他們更多地與愛立信合作，他們有更多的服務提供商在排隊。因此，就概念驗證的數量以及概念驗證轉化為有意義的上線發布而言，該漏斗繼續良好地構建。

And any other potential customers in the pipeline that you can talk about or is it still the North America service provider and the European equipment vendor?

您可以談談管道中的任何其他潛在客戶，還是北美服務提供商和歐洲設備供應商？

Yes. Those are the -- I mean, they remain the big 2 and what I would say is, we see more opportunities with both of those customers. As we look at service provider, we have a sell to. From a traditional IT perspective, we have a sell with where we're part of their solution from an OEM. And now we see opportunities to sell through to be their partner, their enterprise partner. And so, these are the 3 prongs that we're attacking the service provider market with. And there are significant growth opportunities that we see in the market.

是的。那些 - 我的意思是，他們仍然是大 2，我想說的是，我們看到了這兩個客戶的更多機會。當我們查看服務提供商時，我們有一個賣給。從傳統的 IT 角度來看，我們有一個銷售，我們是 OEM 解決方案的一部分。現在我們看到了通過銷售成為他們的合作夥伴、他們的企業合作夥伴的機會。因此，這些是我們用來攻擊服務提供商市場的 3 個分支。我們在市場上看到了巨大的增長機會。

And my last question is, I may have missed it, but did you give out the backlog composition in the mix?

我的最後一個問題是，我可能錯過了，但是你有沒有給出混合中的積壓成分？

I don't believe we did give the composition of backlog mix. When you're saying mix, you're referring to?

我不相信我們確實給出了積壓組合的構成。當你說混音時，你指的是什麼？

Wired and Wireless.

有線和無線。

We don't break it down, Dave --

我們不會分解它，戴夫——

Actually broken that down.

實際上把它分解了。

We give a general number.

我們給一個大概的數字。

I think, I would say that we would expect it to be fairly consistent with the overall business mix that we report.

我想，我會說我們希望它與我們報告的整體業務組合相當一致。

And Dave, I would just add that, you know, we did say in our prepared remarks that the backlog has a good contribution from universal platform products. And so, those are the newer products that we have come out to market with. So we did talk about that.

戴夫，我只想補充一點，你知道，我們在準備好的評論中確實說過，積壓工作對通用平台產品有很好的貢獻。因此，這些是我們推向市場的新產品。所以我們確實談到了這一點。

(Operator Instructions) Our next question comes from Christian Schwab with Craig-Hallum.

（操作員說明）我們的下一個問題來自 Christian Schwab 和 Craig-Hallum。

This is Tyler on behalf of Christian. So I didn't hear and I was wondering if you could give any update, I think you said last quarter that you expected that your backlog would take multiple years to return to normalized levels. And it probably wouldn't be back to $50 million to $100 million type normalized level until fiscal '26. I guess, any update or (inaudible) of that?

我是泰勒，代表克里斯蒂安。所以我沒有聽到，我想知道你是否可以提供任何更新，我想你上個季度說過你預計你的積壓需要多年才能恢復到正常水平。在 26 財年之前，它可能不會回到 5000 萬至 1 億美元的標準化水平。我想，有任何更新或（聽不清）嗎？

Yes. We still have the same outlook and the way we've guided that is, that we see backlog returning to normal by the last quarter of fiscal '25. And then sort of being normal as we enter '26. And so, that's how we model it. And that's how we've seen it. And it's a combination of strength of demand, because we continue to see strong bookings. And then also just this -- the release of backlog in terms of how we forecast supply chain.

是的。我們仍然有相同的前景和指導方式，即我們看到積壓在 25 財年最後一個季度恢復正常。然後在我們進入 26 年時有點正常。所以，這就是我們建模的方式。這就是我們所看到的。這是需求強度的結合，因為我們繼續看到強勁的預訂。然後就是這個 - 在我們如何預測供應鏈方面釋放積壓。

And it looks like we have a follow-up. One moment. From Alex Henderson with Needham and Company.

看起來我們有後續行動。一瞬間。來自 Alex Henderson 和 Needham and Company。

Great. So I wanted to ask a question around the realized pricing and discounting. There was a lot of discussion about very steep price hikes over the last 18 months, pretty much out of everybody in the category as components were going up. But the realization of those prices, even as supply is starting to improve seems a little less than what we would have expected. And it sounds like there's probably a little bit more discounting going on as the economy is weakened, particularly out of your competitors. So can you talk a bit about what you're seeing in the pricing arena and how much of the price benefits that you've announced or increases you've announced are now being discounted out?

偉大的。所以我想問一個關於已實現定價和折扣的問題。在過去的 18 個月裡，有很多關於價格大幅上漲的討論，隨著組件的上漲，幾乎沒有人討論過這個類別的價格。但這些價格的實現，即使供應開始改善，似乎也比我們預期的要少一些。聽起來隨著經濟疲軟，尤其是你的競爭對手，可能會有更多的折扣。那麼，您能否談談您在定價領域看到的情況，以及您已經宣布或宣布的漲價中有多少現在被打折了？

Yes. We're you know, that's always the phenomenon Alex, there's always a price increase and then a portion of the price increase gets discounted away. And so, it really is -- it's kind of a combination of art and science and trying to handicap and forecast that. One thing that I can say is that, the supply chain environment is complicated things. Because as we sell and we put orders into backlog, we have different vintage orders that have different levels of pricing in them, if that makes sense.

是的。我們是你知道的，亞歷克斯總是這種現象，價格總是上漲，然後部分價格上漲被打折。所以，它確實是——它是一種藝術與科學的結合，並試圖阻礙和預測它。我可以說的一件事是，供應鏈環境是複雜的事情。因為當我們銷售和將訂單放入積壓訂單中時，如果有意義的話，我們有不同的老式訂單，它們具有不同的定價水平。

Yes.

是的。

So one of the things that we have done last quarter, and that we're looking to do this quarter is released a much older backlog, and that older backlog will not have as many of the pricing moves, if you will, or the price increases in the ASP. So that's part of kind of what we have to balance. Our view is that the margins are going to come. And we fully expect to see that the step function right now, given the mix issues that we talked about in the quarter, and then the March quarter, we see it stepping into the June quarter before we cross over 60%.

因此，我們上個季度所做的事情之一，以及我們希望在本季度做的事情是發布一個更舊的積壓訂單，如果你願意，那麼舊的積壓訂單不會有那麼多的定價變動，或者價格ASP 的增加。所以這是我們必須平衡的一部分。我們的觀點是利潤率將會到來。考慮到我們在本季度和 3 月季度討論的混合問題，我們完全希望看到階躍現在發揮作用，我們看到它在超過 60% 之前進入 6 月季度。

I get it on the margin side, then you're pretty clear on your guidance there. I guess, my question really is how much of the revenue growth is a function of price versus volume, within the both the December quarter and back half outlook?

我在保證金方面得到了它，那麼你在那裡的指導就很清楚了。我想，我的問題確實是，在 12 月季度和後半期展望中，收入增長有多少是價格與數量的函數？

Yes, I think we would point to -- I think we would point to low to mid-single digits for that pricing number.

是的，我認為我們會指出——我認為我們會指出該定價數字的低到中個位數。

Great.

偉大的。

The other comment that I'd make Alex is that the largest competitor in the industry has raised price. And fortunately for us, it creates an umbrella and gives us the flexibility to consider potential pricing moves as well.

我要向亞歷克斯提出的另一條評論是，該行業最大的競爭對手已經提高了價格。對我們來說幸運的是，它創造了一個保護傘，讓我們也可以靈活地考慮潛在的定價變動。

How much do you think Cisco's prices are up?

你認為思科的價格上漲了多少？

We think in the high-single digit, low-double digit range.

我們認為在高個位數、低兩位數的範圍內。

All right. Any thoughts on the trajectory of interest income and tax lines for the next couple of quarters? Obviously, your cash position is improving, your debt is coming down. Makes a little hard for us to calculate that number. What is the march expectation for interest and other income? And for that matter, any sense of the June quarter would be great as well.

好的。對未來幾個季度的利息收入和稅額軌蹟有何想法？顯然，您的現金狀況正在改善，您的債務正在減少。讓我們計算這個數字有點困難。 3 月份對利息和其他收入的預期是多少？就此而言，六月季度的任何感覺也都很棒。

Cristina, you jump in on that one.

克里斯蒂娜，你插手那個。

Yes. Thank you. So we expect interest expense to remain fairly stable as we do bring down our debt. So we don't see a large increase in that. And we're basically affecting our non-GAAP results with roughly an 18% to 19% effective tax rate.

是的。謝謝。因此，我們預計隨著我們降低債務，利息支出將保持相當穩定。所以我們沒有看到這方面有很大的增加。我們基本上以大約 18% 到 19% 的有效稅率影響我們的非 GAAP 結果。

So the net of the numbers, because we don't see the components of it. The net of the numbers, because we don't see the components of it. The net and that number on the interest and other income line should be continuing at around $2.9 million expense? Is that what you're saying?

所以是數字的淨值，因為我們看不到它的組成部分。數字的淨值，因為我們看不到它的組成部分。利息和其他收入線上的淨額和那個數字應該繼續保持在 290 萬美元左右的支出？你是這麼說的嗎？

Should be higher than that for both interest and (inaudible).

應該高於利息和（聽不清）。

That's what you posted in the -- no, interest in the interest line?

那就是您在興趣專欄中發布的內容 - 不，對興趣專欄感興趣嗎？

Yes. That's right. Let's call it 3 -- roughly $3 million to $3.5 million something in that range.

是的。這是正確的。讓我們稱之為 3——大約在這個範圍內的 300 萬到 350 萬美元之間。

And is there a reason why that's not coming down as cash balances are getting better rates and the…

隨著現金餘額的利率越來越高，而且……

Rates are increasing as the balance goes down.

隨著餘額下降，利率正在上升。

Okay. So the rate -- the floating rate on the debt is going up and offsetting the floating rate on the interest -- the cash balances.

好的。所以利率——債務的浮動利率正在上升，並抵消了利息的浮動利率——現金餘額。

Right.

正確的。

Okay. I got it. And the taxes you already gave me. Thanks.

好的。我得到了它。還有你已經給我的稅。謝謝。

Alex, the other thing I would just mention is that the share count, you'll see a drop in share count based on the share repurchases during the second quarter.

亞歷克斯，我要提到的另一件事是股票數量，你會看到基於第二季度股票回購的股票數量下降。

Great. Actually, before I get off of 1 last question that what are you seeing in terms of employee retention and employee wage rates inflation?

偉大的。實際上，在我回答最後一個問題之前，您對員工保留率和員工工資率通脹有何看法？

Well, this is the quarter where we have, from a benefits perspective and from a merit increase, this is when that gets whizzled into our numbers. But you're familiar with that, because that's always the March quarter. We are in a really strong position and really fortunate we have first of all, our turnover is very low, the lowest among the tech industry peers.

好吧，從福利的角度和績效增長的角度來看，這是我們擁有的季度，這是我們的數字中出現的時候。但你對此很熟悉，因為那總是三月季度。我們處於非常有利的地位，我們真的很幸運，首先，我們的營業額非常低，是科技行業同行中最低的。

We do a lot of comparison, evaluation and analysis and our voluntary turnover is incredibly low. And along with that we are in the market and we're hiring, because we're investing in growth, because we have this unique growth opportunity over the next several years, and we have a lot of different growth opportunities that we can invest in. So Extreme has been hiring and our turnover has been low.

我們做了很多比較、評估和分析，我們的自願離職率非常低。與此同時，我們在市場上招聘，因為我們在投資增長，因為我們在未來幾年有這個獨特的增長機會，我們有很多不同的增長機會可以投資. 所以 Extreme 一直在招聘，我們的營業額一直很低。

I'm showing no other questions. I'd like to turn the call back over to management for closing remarks.

我沒有顯示其他問題。我想將電話轉回管理層以作結束語。

Thank you. I'd like to thank everybody for participating in the call today. Obviously, it's a record quarter for Extreme, record revenue, record cash flow. We just missed that 15% operating income number and the momentum as it relates to our bookings and our customer growth continues to be very strong. So we have a lot of different people listening in the call, so shout out to all the Extreme employees, our partner community that's helping us drive growth, our end users out there and of course, all the investors for participating on the call today.

謝謝。我要感謝大家參加今天的電話會議。顯然，這是 Extreme 創紀錄的季度，創紀錄的收入，創紀錄的現金流。我們剛剛錯過了 15% 的營業收入數字以及與我們的預訂相關的勢頭，我們的客戶增長仍然非常強勁。因此，我們有很多不同的人在聽電話，所以向所有 Extreme 員工、幫助我們推動增長的合作夥伴社區、我們的最終用戶，當然還有今天參加電話會議的所有投資者大喊大叫。

We would encourage everyone to participate in the upcoming investor conferences over the next couple of months. And as I said before, there's never been a better time to be at Extreme either employee, partner, customer, investor. And another welcome to Cristina, for joining us today on the call and stepping into her new role. Thanks, everybody. Have a great day.

我們鼓勵大家在接下來的幾個月裡參加即將舉行的投資者會議。正如我之前所說，無論是員工、合作夥伴、客戶還是投資者，現在都是加入 Extreme 的最佳時機。再次歡迎克里斯蒂娜，她今天加入我們的電話會議並開始擔任她的新角色。謝謝大家。祝你有美好的一天。

This 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。