Inseego Corp (INSG) 2023 Q2 法說會逐字稿

Hello, and welcome to Inseego Corp.'s Second Quarter 2023 Financial Results Conference Call. Please note that today's event is being recorded. (Operator Instructions)

您好，歡迎參加 Inseego Corp. 2023 年第二季度財務業績電話會議。請注意，今天的活動正在錄製中。 （操作員說明）

On the call today are Ashish Sharma, CEO; and Bob Barbieri, Chief Financial Officer; and other members of the management team.

今天參加電話會議的是首席執行官 Ashish Sharma；首席財務官鮑勃·巴比耶里 (Bob Barbieri)；以及管理團隊的其他成員。

During this call, non-GAAP financial measures will be discussed. A reconciliation to the most directly comparable GAAP financial measures is included in the earnings release, which is available on the Investors section of the company's website. An audio replay of this call will also be archived there.

在本次電話會議期間，將討論非公認會計準則財務指標。收益報告中包含了與最直接可比的 GAAP 財務指標的調節，可在公司網站的投資者部分查看。此次通話的音頻重播也將存檔在那裡。

Please also be advised that today's discussion will contain forward-looking statements. These forward-looking statements are not historical facts but rather are based on the company's current expectations and beliefs. For a discussion on factors that could cause actual results to differ materially from the expectations, please refer to the risk factors described in our Form 10-K, 10-Q and other SEC filings, which are available on our website. Please also refer to the cautionary note regarding forward-looking statements section contained in today's press release.

另請注意，今天的討論將包含前瞻性陳述。這些前瞻性陳述不是歷史事實，而是基於公司當前的期望和信念。有關可能導致實際結果與預期產生重大差異的因素的討論，請參閱我們網站上提供的 10-K、10-Q 表格和其他 SEC 文件中描述的風險因素。另請參閱今天新聞稿中包含的有關前瞻性陳述部分的警告說明。

I would like to turn the call over to Ashish Sharma, Chief Executive Officer. Please go ahead.

我想將電話轉給首席執行官 Ashish Sharma。請繼續。

Thank you, operator. Q2 was another solid quarter for us, and I'm proud of what our teams have achieved. By all accounts, this was a very good quarter for across the board and gives us confidence that we are on the right path. Each of our businesses performed extremely well during the quarter, and you can see our continued focus on operating efficiency showing up in the financial results.

謝謝你，接線員。第二季度對我們來說又是一個穩定的季度，我為我們團隊所取得的成就感到自豪。從各方面來看，這是一個非常好的季度，讓我們相信我們正走在正確的道路上。我們的每項業務在本季度都表現得非常好，您可以在財務業績中看到我們對運營效率的持續關注。

In particular, we continue to see growth in our 5G FWA business, with revenues up 50% sequentially over last quarter and 2.5x over Q2 2022. While we don't expect FWA to grow this quickly every quarter, it is clearly an indication that market adoption is accelerating. Overall, our 5G product portfolio, which includes both FWA and hotspots, represented over 50% of our quarterly revenues for the first time, with FWA representing roughly 33% of our overall revenues.

特別是，我們繼續看到5G FWA 業務的增長，收入比上季度連續增長50%，比2022 年第二季度增長2.5 倍。雖然我們預計FWA 不會每個季度都增長得這麼快，但這顯然表明市場採用正在加速。總體而言，我們的 5G 產品組合（包括 FWA 和熱點）首次占我們季度收入的 50% 以上，其中 FWA 約占我們總收入的 33%。

This continued migration of our revenue mix resulted in another strong quarter from a margin perspective with gross margin of nearly 36%, which when combined with the continued focus on operating efficiency and cost controls allowed us to deliver our second consecutive quarter of positive operating cash flow.

從利潤率角度來看，我們收入組合的持續遷移導致了另一個強勁的季度，毛利率接近36%，再加上對運營效率和成本控制的持續關注，使我們能夠連續第二個季度實現正運營現金流。

Based on our solid first half 2023 performance, we are very optimistic about the direction of business. As we look ahead to the second half of the year, we are laser-focused on execution and continuing the momentum from the first half of this year. By execution, I mean, delivering on our existing product portfolio, deployments of those products, releasing the next generation of our portfolio and maintaining strong financial discipline.

基於 2023 年上半年的穩健業績，我們對業務方向非常樂觀。展望下半年，我們將重點放在執行上，並延續今年上半年的勢頭。我所說的執行，是指交付我們現有的產品組合、部署這些產品、發布下一代產品組合併保持嚴格的財務紀律。

As an example, in Q2, we released our latest indoor router FX3100 that covers the newly released mid-band previously used by the DoD. We have already launched it with UScellular, and we will be launching it soon with another large carrier.

例如，在第二季度，我們發布了最新的室內路由器 FX3100，涵蓋了國防部之前使用的新發布的中頻段。我們已經與 UScellular 合作推出了該服務，並且很快就會與另一家大型運營商合作推出。

Similarly, we continue to focus on growing our subscription and recurring revenue. We offer multiple cloud packages in different phases of the customer adoption cycle. And we are seeing very good progress in terms of the attach rate across the board. We expect growth will come over next several quarters as FWA customer base expands and universe of Inseego deployments continues to grow. These cloud applications are layered on the top of our 5G FWA product sale and represent step-by-step growth that we are focused on achieving.

同樣，我們繼續專注於增加訂閱量和經常性收入。我們在客戶採用周期的不同階段提供多個雲軟件包。我們看到在整體附加率方面取得了非常好的進展。我們預計，隨著 FWA 客戶群的擴大和 Inseego 部署範圍的持續擴大，未來幾個季度將會出現增長。這些雲應用程序位於我們 5G FWA 產品銷售的頂層，代表著我們致力於實現的逐步增長。

Now let me discuss our quarterly performance. As I mentioned earlier, in Q2, we delivered the second consecutive quarter of positive operating cash flow, which is very positive and something the company hasn't accomplished in a long time. While our cash flow will fluctuate quarter-to-quarter, I'm extremely focused on getting to a point when Inseego is cash flow positive on a consistent basis. In Q2, we generated revenue of $53.6 million and adjusted EBITDA of $4.5 million. We are very proud of our first half 2023 EBITDA result of over $8.5 million.

現在讓我討論一下我們的季度業績。正如我之前提到的，在第二季度，我們連續第二個季度實現了正運營現金流，這是非常積極的，也是公司很長一段時間以來沒有實現過的。雖然我們的現金流會按季度波動，但我非常注重讓 Inseego 的現金流持續保持正值。第二季度，我們的收入為 5360 萬美元，調整後 EBITDA 為 450 萬美元。我們對 2023 年上半年 EBITDA 超過 850 萬美元的業績感到非常自豪。

Our gross margin of 35.7% was consistent with our first quarter results and driven by significant growth in FWA revenue. We expect our gross margins to fluctuate in the mid- to low-30's range based on changes in product mix in any given quarter. But clearly, we are on the right path. Last quarter, we referenced a few onetime items that improved our gross margin. We did not have much of any onetime items in Q2, so it was a much cleaner result from a margin perspective.

我們的毛利率為 35.7%，與第一季度的業績一致，這得益於 FWA 收入的大幅增長。我們預計，根據任何特定季度產品組合的變化，我們的毛利率將在 30% 的中低範圍內波動。但顯然，我們走在正確的道路上。上個季度，我們提到了一些提高毛利率的一次性項目。我們在第二季度沒有太多一次性項目，因此從利潤角度來看，這是一個更清晰的結果。

And as I've mentioned on previous calls, we continue to focus on our controllable expenses and running Inseego as efficiently as possible, which resulted in cash OpEx of close to $17 million for Q2, reflecting our commitment to getting to a point where we are cash flow positive on a sustainable basis.

正如我在之前的電話會議中提到的，我們繼續專注於可控費用並儘可能高效地運營Inseego，這使得第二季度的現金運營支出接近1700 萬美元，這反映了我們對達到目前目標的承諾現金流持續為正。

As it relates to demand, we are seeing a different trend that is shared by the current macroeconomic environment and is impacting the entire industry. First, the demand for both our 5G hotspots and FWA products is solid and growing but inconsistent in any given period. We have seen sudden increases in demand at times, which often lead customers and partners to absorb these shipments prior to placing new orders. Second, our customers and partners are keeping much less inventory compared to pre-pandemic periods, which means we and our supply chain need to react very quickly to these demand variations.

就需求而言，我們看到了當前宏觀經濟環境所共有的不同趨勢，並且正在影響整個行業。首先，對我們的 5G 熱點和 FWA 產品的需求穩定且不斷增長，但在任何特定時期都不一致。我們有時會看到需求突然增加，這常常導致客戶和合作夥伴在下新訂單之前吸收這些貨物。其次，與大流行前相比，我們的客戶和合作夥伴的庫存要少得多，這意味著我們和我們的供應鏈需要對這些需求變化做出快速反應。

Finally, this industry trend is making us leave some demand on the table in any given period as we try to build and ship products well within the lead times, even if those lead times are much shorter than the lead times we have seen over the last couple of years. This has resulted in a dynamic where we have developed backlog from quarter-to-quarter, something I had not seen at Inseego prior to last quarter, and it has now happened 2 quarters in a row.

最後，這一行業趨勢使我們在任何特定時期都留下了一些需求，因為我們試圖在交貨時間內製造和運輸產品，即使這些交貨時間比我們過去看到的交貨時間短得多許多年。這導致了我們每個季度都出現積壓的情況，這是我在上個季度之前在 Inseego 從未見過的情況，現在已經連續兩個季度出現這種情況。

Despite the variability in demand cycle, we are seeing enterprise customers accelerate their investments in 5G as they gain a greater understanding of what 5G can do for their business.

儘管需求週期存在變化，但我們看到企業客戶加速了對 5G 的投資，因為他們對 5G 為其業務帶來的幫助有了更深入的了解。

Now let me share a bit more detail about our FWA deployment progress. We are seeing deployments across both small and large companies. An increasing number of large well-known companies have deployed 5G FWA across their nationwide footprints. Many more are assessing FWA as either a primary or backup connection with small-scale trials that we hope lead to large-scale network-wide deployments. This is a market that is in the early stages of adoption, but based on what we are seeing, is one with huge potential.

現在讓我更詳細地分享一下我們的 FWA 部署進度。我們看到小型和大型公司都有部署。越來越多的大型知名企業已在全國范圍內部署5G FWA。更多人正在通過小規模試驗評估 FWA 作為主要或備用連接，我們希望這些試驗能夠實現大規模網絡範圍的部署。這是一個處於早期採用階段的市場，但根據我們的觀察，這是一個潛力巨大的市場。

As we look towards the second half of 2023, I'd like to share a few observations. First, we are expecting to see modest revenue growth in the second half of 2023, driven by our FWA business. This is primarily a function of the shift in mix from 4G to 5G products. 5G will continue to grow in the second half of the year but largely offset by a decline in our 4G business.

展望 2023 年下半年，我想分享一些看法。首先，在我們的 FWA 業務的推動下，我們預計 2023 年下半年收入將出現溫和增長。這主要是由於產品組合從 4G 轉向 5G。下半年 5G 將繼續增長，但很大程度上被 4G 業務的下滑所抵消。

Second, we have a significant pipeline of customers for FWA deployments. In many cases, customers are waiting for better mid-band coverage before rolling out at scale, but we have many trials underway. Third, our financial performance is much improved and reflects the strength of our strategy and the benefits from the investments we have made over the last several years.

其次，我們擁有大量 FWA 部署客戶。在許多情況下，客戶在大規模推出之前都在等待更好的中頻覆蓋，但我們正在進行許多試驗。第三，我們的財務業績有了很大改善，反映了我們戰略的優勢以及我們過去幾年投資的效益。

Our focus on operational discipline and excellence that we've implemented starting late last year is bearing fruit, driving improved margins and cash flow and an increasing number of customer wins. Our cost structure has been rightsized, and will continue to focus on running the business efficiently. This focus has allowed us to generate positive cash flow in the past 2 quarters.

我們從去年年底開始實施的對運營紀律和卓越的關注正在取得成果，推動了利潤和現金流的提高，並贏得了越來越多的客戶。我們的成本結構已經調整，並將繼續專注於高效運營業務。這一重點使我們在過去兩個季度產生了正現金流。

We expect some volatility in cash flows quarter-to-quarter, but this will likely largely be working capital and managing the supply chain and inventory needs of our customers based on the demand patterns I described above. Having said that, we expect to be cash flow positive for the full year even with potential quarter-to-quarter volatility, which is a huge milestone for the company and one that we've been working hard to achieve.

我們預計每個季度的現金流都會出現一些波動，但這可能主要是營運資金以及根據我上面描述的需求模式管理客戶的供應鍊和庫存需求。話雖如此，即使存在潛在的季度波動，我們預計全年現金流仍將為正值，這對公司來說是一個巨大的里程碑，也是我們一直在努力實現的目標。

I'll now turn it over to Bob.

我現在把它交給鮑勃。

Thank you, Ashish. First, I want to extend my thanks to the entire worldwide Inseego team for delivering another very solid quarter, delivering positive profitability and cash flow. Well done. Let me review the results of our second quarter fiscal 2023. Please note that all metrics and comparisons made are on a non-GAAP basis. Please refer to our earnings release for additional details on the GAAP to non-GAAP reconciliation.

謝謝你，阿什什。首先，我要感謝 Inseego 的整個全球團隊，他們又交付了一個非常穩健的季度，帶來了積極的盈利能力和現金流。做得好。讓我回顧一下 2023 財年第二季度的業績。請注意，所有指標和比較均基於非 GAAP 基礎。請參閱我們的收益發布，了解有關 GAAP 與非 GAAP 調節的更多詳細信息。

Q2 revenue was $53.6 million, up 5.4% from the prior quarter. Our FWA and cloud software business comprised 65% of our total revenue and grew 42% over the prior year period. Next-generation solutions, which are comprised of 5G devices and all our cloud software offerings, represented 81% of the total revenue in this quarter. Software revenue accounted for 29% of total revenue.

第二季度收入為 5360 萬美元，比上一季度增長 5.4%。我們的 FWA 和雲軟件業務占我們總收入的 65%，比上年同期增長 42%。下一代解決方案由 5G 設備和我們所有的雲軟件產品組成，佔本季度總收入的 81%。軟件收入佔總收入的29%。

Second quarter IoT & Mobile Solutions revenue was $46.4 million, up 6.5% from the last quarter. The growth was driven by an uptake of our FWA solutions. Enterprise SaaS Solutions revenue was $7.2 million, down 1% sequentially and up 4.5% over the prior year quarter.

第二季度物聯網和移動解決方案收入為 4640 萬美元，較上季度增長 6.5%。這一增長是由我們的 FWA 解決方案的採用推動的。企業 SaaS 解決方案收入為 720 萬美元，比上一季度下降 1%，比去年同期增長 4.5%。

Consolidated gross margin was 35.7%, down 40 basis points from 36.1% in Q1 and up 602 basis points from 29.5%. Gross margin for the IoT & Mobile business was 32.9%, down slightly from 33.4% in the prior quarter and up from 27% in the prior year period. As Ashish alluded to in his comments, the meaningful improvement in gross margin on a year-over-year basis was attributable to a significantly higher mix of FWA revenue. Gross margin for the Enterprise SaaS segment was 54.1%, up from 52.7% in Q1 and up from 49.4% in Q2 of 2022.

綜合毛利率為 35.7%，較第一季度的 36.1% 下降 40 個基點，較第一季度的 29.5% 上升 602 個基點。物聯網和移動業務的毛利率為 32.9%，略低於上一季度的 33.4%，高於去年同期的 27%。正如 Ashish 在評論中提到的那樣，毛利率同比顯著改善歸因於 FWA 收入組合的顯著提高。企業 SaaS 細分市場的毛利率為 54.1%，高於 2022 年第一季度的 52.7% 和第二季度的 49.4%。

Q2 non-GAAP net loss was $2 million or a negative $0.02 per share compared with a loss of $0.03 per share in the prior quarter and a loss of $0.04 per share in the year ago quarter.

第二季度非 GAAP 淨虧損為 200 萬美元，即每股負 0.02 美元，而上一季度每股虧損 0.03 美元，去年同期每股虧損 0.04 美元。

We reported an adjusted EBITDA gain of $4.5 million, which was up from a gain of $4.1 million in Q1 and higher than the $1 million EBITDA loss in the year ago period.

我們報告調整後 EBITDA 收益為 450 萬美元，高於第一季度 410 萬美元的收益，也高於去年同期 100 萬美元的 EBITDA 虧損。

For additional details on our non-GAAP and adjusted EBITDA results, please refer to our reconciliation tables in our press release.

有關我們的非 GAAP 和調整後 EBITDA 結果的更多詳細信息，請參閱我們新聞稿中的調節表。

Cash, cash equivalents and restricted cash at the end of Q1 was $15.2 million. This cash balance was up from our cash balance of $8.7 million in the prior quarter.

第一季度末的現金、現金等價物和限制性現金為 1,520 萬美元。這一現金餘額高於上一季度 870 萬美元的現金餘額。

With that, let me turn it back to Ashish for his closing comments.

說到這裡，讓我把話題轉回阿什什，聽聽他的結束語。

Thanks, Bob. To summarize, our ability to transform Inseego into an FWA solution company was demonstrated by first half results. There remains a huge growth opportunity across many of these enterprise customer segments enabled by our portfolio of 5G hardware and software. As 5G mid-band coverage continues to scale, the breadth of our portfolio gives me confidence in our ability to capture the many opportunities ahead.

謝謝，鮑勃。總而言之，上半年的業績證明了我們將 Inseego 轉型為 FWA 解決方案公司的能力。我們的 5G 硬件和軟件產品組合為許多企業客戶群帶來了巨大的增長機會。隨著 5G 中頻段覆蓋範圍的不斷擴大，我們產品組合的廣度讓我對我們抓住未來眾多機遇的能力充滿信心。

(Operator Instructions) The first question is from Scott Searle of ROTH Capital Partners.

（操作員說明）第一個問題來自 ROTH Capital Partners 的 Scott Searle。

Nice job on the quarter. Ashish, maybe to quickly follow up. I want to make sure I heard some numbers correctly. I thought you said that the 5G FWA solution was 33% of the mix. I wanted to confirm that. Also, I'm not sure if I heard a mix number between 4G and 5G. I'd love to get the update on that front. And is there a comparable software number? I think you said it was 29% of the mix in the current quarter. Is there a comparable number that you had for the first quarter or the year ago period? And then I had a couple of follow-ups.

本季度工作做得很好。 Ashish，也許要快速跟進。我想確保我正確地聽到了一些數字。我以為你說過 5G FWA 解決方案占到了 33%。我想確認這一點。另外，我不確定是否聽到過 4G 和 5G 之間的混合數字。我很想了解這方面的最新情況。還有類似的軟件嗎？我想你說過這是當前季度的 29%。第一季度或去年同期的數字是否可比？然後我進行了一些後續行動。

Scott, yes, let me give you those numbers. I'll start with the last one first. So the software revenue was in the 28%, 29% range of the overall revenue. The -- and I would say about 5G was over 50%, so close to like 52%, and 4G overall was close to 19%, 20% of the overall revenue.

斯科特，是的，讓我給你這些數字。我先從最後一個開始。所以軟件收入佔總收入的28%到29%之間。我想說的是 5G 超過了 50%，接近 52%，而 4G 總體接近 19%，佔總收入的 20%。

Great. Very helpful. And then, Bob, maybe for you on the OpEx front, you guys have tightened things up a little bit. R&D was up this quarter. Wondering if there's anything to read into that and how we should be thinking about OpEx going forward if there's some further tightening or these are the levels we should be thinking about?

偉大的。很有幫助。然後，鮑勃，也許對於您在運營支出方面來說，你們已經把事情收緊了一點。本季度研發有所增長。想知道是否有什麼值得解讀的，以及如果有進一步收緊的情況，我們應該如何考慮未來的運營支出，或者這些是我們應該考慮的水平？

Yes. Let me start -- good questions. Let me start with your second question. I would view OpEx as flat to slightly down as we go forward. So thinking that way.

是的。讓我開始——好問題。讓我從你的第二個問題開始。隨著我們的發展，我認為運營支出將持平甚至略有下降。所以就這麼想。

And regarding your R&D question, actually, cash R&D was flat and will remain flat to slightly down. I think what you saw on a book basis is just limited to kind of how we amortize software with the mix of our various products. So that's what drove the book look that way.

關於你的研發問題，實際上，現金研發持平，並將保持持平或略有下降。我認為您在書本上看到的內容僅限於我們如何通過各種產品的組合來攤銷軟件。這就是這本書看起來如此的原因。

Great. And then maybe, Ashish, just from a high level, looking at the opportunity in the pipeline for 5G FWA, I'm wondering if you could give us some metrics to kind of put around it. It's taken some time in terms of building out the mid-band coverage. It feels like we're a lot closer, and you're starting to build up those pilots in that opportunity. I was wondering if there's some either soft metrics or harder metrics you could give us in terms of the pipeline, how big it is, the number of customers, maybe potentially the number of addressable devices that are under discussion.

偉大的。然後，Ashish，從較高的層面來看，看看 5G FWA 中的機會，我想知道您是否可以給我們一些衡量標準來解決它。建立中頻覆蓋範圍需要一些時間。感覺我們離目標更近了，你開始在這個機會中建立這些試點。我想知道您是否可以在管道方面向我們提供一些軟指標或硬指標，管道有多大，客戶數量，可能還有正在討論的可尋址設備的數量。

And going forward, what is the sales cycle looking like? Is that starting to compress? And when do you really think that we start to see the inflection? Does it happen later this year? Or we wait until 2024?

展望未來，銷售週期是什麼樣的？是不是開始壓縮了？您認為我們什麼時候真正開始看到這種變化？今年晚些時候會發生嗎？或者我們等到2024年？

Yes, Scott. So what I would say is, right, the market buildup would be gradual, right, as I've mentioned before. And the main reason really is that there are a number of different factors that every enterprise or SMB customer looks at. The offering itself is really good, like the pipeline of interest from customers. We have thousands of customers, SMB and enterprise customers who have trialed the product, trialed the 5G network, and they love it, but they all have different operational workflows, right, that they're trying to put on 5G and kind of segregate that away from the other broadband connections they have, right?

是的，斯科特。所以我想說的是，市場的建設將是漸進的，正如我之前提到的。主要原因確實是每個企業或中小企業客戶都會考慮許多不同的因素。產品本身非常好，就像客戶感興趣的渠道一樣。我們有數以千計的客戶、中小企業和企業客戶，他們試用了該產品，試用了5G 網絡，他們喜歡它，但他們都有不同的操作工作流程，對吧，他們試圖部署5G，並在某種程度上將其隔離。遠離他們擁有的其他寬帶連接，對嗎？

So the decision-making, the decision process is very different from what we saw from our hotspot business in the past. And so it's a gradual step-by-step build. Lots of interest. Pipeline continues to be super healthy from big Fortune 100, 500 companies, to lots and lots of SMBs. And I would say, like, the deployment cycle really depends on your use case, right? I mean where you have a use case of a remote worker, I mean that sale cycle is quite small.

所以決策、決策過程和我們過去在熱點業務中看到的有很大不同。所以這是一個漸進的一步一步的構建。很多興趣。從財富 100 強、500 強大公司到許許多多的中小企業，管道仍然非常健康。我想說，部署週期確實取決於您的用例，對吧？我的意思是，當您有遠程工作人員的用例時，我的意思是銷售週期非常小。

I mean that could take just a matter of a few weeks for the customer to trial the product and then start handing it out to their workforce, remote workforce, to bigger use cases where our outdoor product is going on connecting like thousands of locations, distributed locations, store locations for their customer and then kind of integrating the 5G band as part of their broader network that's in place, the existing LAN and the existing WAN infrastructure.

我的意思是，客戶可能只需要幾週的時間來試用該產品，然後開始將其分發給他們的員工，遠程員工，以及更大的用例，在這些用例中，我們的戶外產品將連接數千個地點，分佈式位置、為客戶提供商店位置，然後將 5G 頻段集成到現有的更廣泛網絡、現有 LAN 和現有 WAN 基礎設施中。

So those deployments would take a little bit of time, like they take, to give you an example, like you have a large customer who trialed the product maybe 12 to 18 months ago, and they trialed for a few months, they love the product. And it's taken them like 8 to 10 months now to roll it out to multiple thousand locations for the product. So in that case, it took time. But overall, the size of the business with each one of these enterprises is really good.

因此，這些部署需要一點時間，就像他們所花費的那樣，給你舉個例子，就像你有一個大客戶，他可能在12 到18 個月前試用了該產品，他們試用了幾個月，他們喜歡這個產品。他們花了大約 8 到 10 個月的時間才將該產品推廣到數千個地點。所以在這種情況下，需要時間。但總體而言，這些企業的業務規模都非常不錯。

Great. And maybe last one, if I could. Just in terms of the channel for 5G fixed wireless access, you've got relationships with multiple carriers. I'm wondering if there's anything that's particularly productive, either from a carrier standpoint or other channel, VAR or otherwise, that you're seeing a lot of productivity?

偉大的。如果可以的話，也許是最後一個。僅就5G固定無線接入渠道而言，就與多個運營商有關係。我想知道是否有什麼特別高效的東西，無論是從運營商的角度還是其他渠道（VAR 或其他渠道）來看，您都看到了很高的生產力？

Yes. I mean we have multiple route to market. As you mentioned, Scott, we have the traditional SD&R channel. We have multiple programs with different carriers. And I would say the initial push, we're getting a lot of assistance from the carriers. I mean they're obviously super motivated to sell a lot of 5G band to enterprises, and they love our solutions. And that's where I would say that we're seeing the biggest success, either through the stock program we have with them or through multiple other co-sell programs we have with the carriers.

是的。我的意思是我們有多種進入市場的途徑。正如您提到的，斯科特，我們有傳統的 SD&R 渠道。我們與不同的運營商有多個計劃。我想說的是，在最初的推動過程中，我們從運營商那裡得到了很多幫助。我的意思是，他們顯然非常有動力向企業出售大量 5G 頻段，而且他們喜歡我們的解決方案。這就是我想說的，我們看到了最大的成功，無論是通過我們與他們合作的庫存計劃，還是通過我們與運營商合作的多個其他聯合銷售計劃。

The next question is from Lance Vitanza of Cowen & Company.

下一個問題來自 Cowen & Company 的 Lance Vitanza。

Congratulations on the quarter. A couple of questions here. The first, so tell me if this makes sense. So you've got a fixed wireless access and cloud business. It looks like it's at about $145 million revenue run rate, and it's growing at 40% year-on-year. So I was just wondering, is it possible to talk about, I guess, 3 things? One, how long do you see -- how long do you think you can maintain that type of growth? Or what does the growth plan look like over the next couple of years?

祝賀本季度。這裡有幾個問題。第一個，請告訴我這是否有意義。這樣您就擁有了固定無線接入和雲業務。看起來它的收入運行率約為 1.45 億美元，並且同比增長 40%。所以我只是想知道，我猜是否有可能談論三件事？第一，你認為這種增長能維持多久？或者未來幾年的增長計劃是什麼樣的？

Two, what is the fixed cost base necessary to support that growing revenue stream?

第二，支持不斷增長的收入流所需的固定成本基礎是多少？

And then -- and finally, what are the incremental margins? I mean, should we think about it -- is it a 35% sort of flow-through once you've covered your fixed costs? Or is it considerably higher? Or is it lower than that, et cetera? I mean I think those questions would really help us triangulate on how to value this growing business.

然後——最後，增量利潤是多少？我的意思是，我們是否應該考慮一下——一旦你支付了固定成本，這是否是 35% 的流通？還是相當高？或者比這個低，等等？我的意思是，我認為這些問題確實有助於我們三角測量如何評估這一不斷增長的業務。

Lance, good question. So let me try to break that down, right? So maybe I'll talk about first in the short term, right? I would say in the short term, the way you look at things is it's step-by-step incremental improvements, right? I mean I would not say that we could see this type of FWA growth every quarter. I mean it would be -- early in developing a new market, you see these up and down jumps. So we'll see that. But in the next longer term, right, 4 to 6 quarters, whatever you have it, that should settle down. And I would say the market opportunity itself is huge. So we're just only seeing a sliver of the market right now. And hence, the variability in the business and the order flow.

蘭斯，好問題。那麼讓我試著分解一下，對嗎？所以也許我會在短期內首先討論，對嗎？我想說，從短期來看，你看待事物的方式是逐步漸進式改進，對嗎？我的意思是，我不會說我們每個季度都會看到這種類型的 FWA 增長。我的意思是，在開發新市場的早期，你會看到這些上下跳躍。所以我們會看到這一點。但在下一個較長時期內，對吧，四到六個季度，無論你有什麼，這應該會穩定下來。我想說市場機會本身是巨大的。所以我們現在只看到了市場的一小部分。因此，業務和訂單流的可變性。

Software business is a lot more stable. It grows at a slower pace, but the way we have tied it up now with our 5G business is when FWA grows, so will our software business will grow.

軟件業務更加穩定。它的增長速度較慢，但​​我們現在將其與 5G 業務捆綁在一起的方式是，當 FWA 增長時，我們的軟件業務也會增長。

So I would say that in the long term, definitely, you're looking at very high growth rates year-over-year, double digits, higher growth rates. How? Within the shorter lifespan of every quarter-to-quarter, how that movie plays out, that just -- it's going to be step by step, if that makes sense.

所以我想說，從長遠來看，毫無疑問，你會看到非常高的同比增長率，兩位數，更高的增長率。如何？在每個季度較短的生命週期內，這部電影的表現如何，這將是一步一步的，如果這有意義的話。

And then your last question about margins. I mean I would just say, look, we're just getting started. I mean we've got more growth on FWA coming. We've got multiple power packages that are very early in the adoption cycle. So as those things kick in, I mean, I definitely see that the overall gross margin target of over 40% is definitely very achievable.

然後是關於利潤的最後一個問題。我的意思是我只想說，看，我們才剛剛開始。我的意思是我們的 FWA 將會有更多的增長。我們擁有多個處於採用周期早期的電源包。因此，隨著這些事情的發生，我的意思是，我確實看到超過 40% 的總體毛利率目標絕對是可以實現的。

Okay. That's actually really helpful. Next bunch of questions on free cash flow, where you did a nice job there. You generated some free cash flow. We were expecting you to burn cash on a comparable kind of EBITDA number, so that was good. I'm just trying to understand the variance. It looks like your CapEx was pretty close to what we had expected. So that doesn't explain it. But can you -- is it possible for Bob, maybe could you walk us just from EBITDA to free cash flow, $4.5 million of EBITDA, $3 million I'm calculating of sort of levered free cash flow. I'm guessing you had an inflow from working capital, working capital generated some cash. Is that accurate?

好的。這實際上非常有幫助。接下來是關於自由現金流的一系列問題，您在這方面做得很好。您產生了一些自由現金流。我們預計您會在類似的 EBITDA 數字上燒錢，所以這很好。我只是想了解差異。看來您的資本支出與我們的預期非常接近。所以這並不能解釋它。但是鮑勃可以嗎？也許你可以引導我們從 EBITDA 轉向自由現金流，450 萬美元的 EBITDA，我正在計算 300 萬美元的槓桿自由現金流。我猜你有來自營運資金的流入，營運資金產生了一些現金。準確嗎？

Our working capital did moderate in a positive direction from a cash standpoint. I'm just digging out a couple of other things. The other things we had working for us is basically we, I should say -- and again, against our expectation. We also, again, skimming down CapEx. We think we're in a good spot. We had a positive effect from working capital, as you mentioned. And then lastly -- and you probably saw this from the balance sheet, we also worked on inventory levels as we've been kind of aiming to do over the last 2 or 3 quarters. We're not -- just from a forward expectation standpoint, we're not saying we could do that indefinitely, but we did skinny it down quite a bit versus prior year. That's the big movement.

從現金的角度來看，我們的營運資本確實朝著積極的方向發展。我只是在挖掘其他一些東西。我應該說，我們為我們工作的其他事情基本上是我們的——而且，這又違背了我們的預期。我們還再次削減資本支出。我們認為我們處於一個好的位置。正如您提到的，營運資金對我們產生了積極的影響。最後，您可能從資產負債表中看到了這一點，我們還研究了庫存水平，正如我們在過去兩三個季度的目標一樣。我們不是——只是從未來預期的角度來看，我們並不是說我們可以無限期地這樣做，但我們確實比去年減少了很多。這就是大運動。

Okay. And then I did see something below the sort of the cash flow line. It looks like you raised $5.5 million in the quarter from a public offering. And I'm wondering if you could provide more detail on that transaction or if I'm misreading that?

好的。然後我確實看到了現金流量線下方的一些東西。您本季度似乎通過公開募股籌集了 550 萬美元。我想知道您是否可以提供有關該交易的更多詳細信息，或者我是否誤讀了？

Yes. No, no. Good, Lance. Yes, the other thing that was a contributor, kind of a nonoperational contributor, more of a financing, is we still had open capacity in the ATM facility that was in place for the last couple of years. And then working with our Board, one of the things we wanted to achieve was just maximum liquidity and flexibility. So we did execute against that, and that's where we raised, it's about $5.4 million.

是的。不，不。很好，蘭斯。是的，另一件事是貢獻者，一種非運營貢獻者，更多的是融資，是我們在過去幾年建立的 ATM 設施中仍然擁有開放能力。然後與我們的董事會合作，我們想要實現的目標之一就是最大的流動性和靈活性。所以我們確實執行了這個計劃，這就是我們籌集的資金，大約是 540 萬美元。

Next question is from Tore Svanberg of Stifel.

下一個問題來自 Stifel 的 Tore Svanberg。

This is Jeremy on for Tore. I guess, yes, just let me offer my congratulations on the solid free cash flow performance as well. And just a quick follow-up on that last question. The ATM, is there -- is that complete now? Are there plans to continue raising capital? Or is this $15 million sufficient in the near to medium term?

這是托雷的傑里米。我想，是的，請允許我對穩健的自由現金流表現表示祝賀。對最後一個問題進行快速跟進。 ATM 機在那裡——現在完成了嗎？是否有繼續籌集資金的計劃？或者說，這 1500 萬美元在中短期內是否足夠？

We -- right now, I think the best way to handle it is we don't have -- we're not active in the market right now. So that's first. And we'll reserve to see if we have any new financing. But we have correctly sized the company factors. We've taken some additional cost reduction actions that are not yet in the financials, but they will accrue positively to the latter part of this year. So we think we're very, very well positioned from a cost stack standpoint.

我們——現在，我認為最好的處理方法是我們沒有——我們現在在市場上並不活躍。這是第一。我們將保留看看是否有任何新的融資。但我們已經正確衡量了公司因素。我們已經採取了一些額外的成本削減措施，這些措施尚未納入財務數據，但它們將在今年下半年產生積極的影響。因此，我們認為從成本堆棧的角度來看，我們處於非常非常有利的位置。

And just on those cost reductions in the latter part of the year, is that -- is there a way to quantify that for us? How should we think about that? I know you did state for this next quarter we should think about being down a little bit sequentially, but how about in Q4?

就今年下半年的成本削減而言，有沒有辦法為我們量化？我們應該如何思考這個問題？我知道您確實表示下個季度我們應該考慮連續下降一點，但第四季度怎麼樣？

Jeremy, so what I would say is the $17 million cash OpEx we have right now, as Bob mentioned earlier, I think you can take that as slightly moderate to down later in the year. And that right there is about over a $40 million cost that we have taken out of the company going back to last 4 quarters or so?

傑里米，所以我想說的是我們現在擁有 1700 萬美元的現金運營支出，正如鮑勃之前提到的，我認為你可以認為今年晚些時候這一數字會略有下降。那麼，從過去 4 個季度左右的時間來看，我們已經從公司中扣除了超過 4000 萬美元的成本？

Got it. And then maybe switching to the backlog commentary, Ashish, that you provided, you said it was up sequentially in the second quarter in a row. Can you help quantify that for us?

知道了。然後也許切換到您提供的積壓評論，Ashish，您說它在第二季度連續上升。您能幫我們量化一下嗎？

And then when you talk about having some of the orders that you're leaving some on the table, are these basically getting pushed out in the future quarters and being added to backlog? Just help us to understand kind of your visibility.

然後，當您談到要保留一些訂單時，這些訂單是否基本上會在未來幾個季度被推出並添加到積壓訂單中？只需幫助我們了解您的可見度即可。

Yes. Good question, Jeremy. Yes, I mean, those orders that we can't fulfill get pushed out to the next quarter. For this quarter, like, look, we just finished the first month of the quarter and we are in a really good shape in terms of our target revenue for this quarter, and it's all on supply chain now, right? So we're driving our CMs really hard to fulfill that -- those orders that you got. So bulk of the revenue demand for this quarter, we already have orders for you.

是的。好問題，傑里米。是的，我的意思是，那些我們無法履行的訂單會被推遲到下個季度。對於本季度，我們剛剛結束了本季度的第一個月，就本季度的目標收入而言，我們的狀況非常好，而且現在一切都在供應鏈上，對吧？因此，我們正在非常努力地推動我們的 CM 履行您收到的訂單。因此，本季度的大部分收入需求，我們已經為您準備了訂單。

Got it. And sorry if I missed it, but did you provide expectations for this quarter? You said you had the bulk of the demand already in place.

知道了。如果我錯過了，抱歉，您是否提供了對本季度的預期？你說大部分需求已經到位。

Yes. I mean, look, we're not providing exactly like the dollar number for the orders we have. I would just say like it's coming from what multiple different customers. And we're just -- we have unloaded everything we have in inventory for those specific products, and we're now quickly trying to refill that inventory so we can ship the products to the customers.

是的。我的意思是，你看，我們提供的金額與我們訂單的美元金額並不完全相同。我只想說它來自多個不同的客戶。我們只是 - 我們已經卸載了這些特定產品的所有庫存，現在我們正在快速嘗試補充庫存，以便我們可以將產品運送給客戶。

Got it. And then last question before I jump back in the queue. But on the inventory side, it sounds like it's lower than you'd like and you're trying to refill that inventory. Can you give us what kind of targets you might have internally? And if you have any commentary in terms of channel inventory, whether at your -- the VARs or supply -- or carriers?

知道了。然後是我跳回隊列之前的最後一個問題。但在庫存方面，聽起來比您想要的要低，並且您正在嘗試補充該庫存。您能否告訴我們您的內部目標是什麼？如果您對渠道庫存有任何評論，無論是您的 VAR、供應商還是運營商？

Yes. I mean, look, not a lot of inventory at the channel and at the carriers right now. And I'm not anticipating building up a lot more inventory. I think we're going to just run pretty moderate to what we have right now. And again, the whole reason we don't want to bulk up a lot of inventory is just the demand cycles, the variability of the demand cycles within the quarters are still with the macro, or they're still up and down. And so we just -- we're trying to be very cautious on trying to maximize the demand that we have with our customers and yet not load up the inventory as we had last year.

是的。我的意思是，看，目前渠道和運營商的庫存並不多。我預計不會增加更多的庫存。我認為我們將按照目前的情況進行適度的運行。再說一次，我們不想增加大量庫存的全部原因只是需求週期，季度內需求週期的變化仍然與宏觀有關，或者仍然是上下波動。因此，我們非常謹慎地努力最大限度地滿足客戶的需求，但又不會像去年那樣增加庫存。

This concludes our question-and-answer session. I would like to turn the conference back over to Ashish Sharma for any closing remarks.

我們的問答環節到此結束。我想將會議轉回阿希什·夏爾馬 (Ashish Sharma) 發表閉幕詞。

Thank you, operator, and thank you, everyone, for joining us on the call today. We look forward to updating you all next quarter on our continued promise. Thank you again.

謝謝接線員，也謝謝大家今天加入我們的電話會議。我們期待在下個季度向大家通報我們持續承諾的最新情況。再次感謝你。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連接。