View Inc (VIEW) 2023 Q3 法說會逐字稿

Greetings, and welcome to View, Inc.'s third quarter 2023 earnings call. At this time, all participants are in a listen only mode. A question-and answer-session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Samuel Meehan, Head of Investor Relations at View. Thank you, Samuel. You may begin.

您好，歡迎參加 View, Inc. 的 2023 年第三季財報電話會議。此時，所有參與者都處於只聽模式。正式演講之後將舉行問答會議。提醒一下，本次會議正在錄製中。現在我很高興向您介紹主持人，View 投資者關係主管 Samuel Meehan。謝謝你，塞繆爾。你可以開始了。

Good afternoon, everyone, and welcome to View's third quarter 2023 earnings call. I'm Samuel Meehan, Head of Investor Relations at View. I'm here with Dr. Rao Mulpuri, our CEO; and Amy Reeves our CFO. Before we begin, I'd like to remind you that after market closed today, View issued a press release announcing its third quarter 2023 financial results, which you may access in the Investor Relations section of view.com.

大家下午好，歡迎參加 View 2023 年第三季財報電話會議。我是 View 投資者關係主管 Samuel Meehan。我和我們的執行長 Rao Mulpuri 博士一起來到這裡。和我們的財務長艾米·里夫斯。在我們開始之前，我想提醒您，今天收盤後，View 發布了一份新聞稿，宣布其 2023 年第三季度財務業績，您可以在 view.com 的投資者關係部分訪問該新聞稿。

As today's discussion includes forward-looking statements, please refer to our press release for a discussion of factors that could cause the company's actual performance to differ materially from those forward-looking statements. These forward-looking statements involve risks and uncertainties. Many of which are beyond our control and could cause actual results to differ materially from our expectations. These forward-looking statements apply as of today, and we undertake no obligation to update these statements after our call.

由於今天的討論包括前瞻性陳述，請參閱我們的新聞稿，以了解可能導致公司實際業績與這些前瞻性陳述存在重大差異的因素的討論。這些前瞻性陳述涉及風險和不確定性。其中許多因素超出了我們的控制範圍，可能導致實際結果與我們的預期有重大差異。這些前瞻性陳述從今天起適用，我們不承擔在電話會議後更新這些陳述的義務。

For a more detailed description of certain factors that could cause actual results to differ, please refer to our filings with the SEC, including our most recent annual report on Form 10-K and subsequent filings, including quarterly reports on Form 10-Q. I would also like to remind you that during the call, we will discuss certain non-GAAP measures related to View's performance. You can find the reconciliation of these measures to nearest comparable GAAP measures in the press release. Unless otherwise stated, our comments during the call refer to non-GAAP results of operations.

有關可能導致實際結果不同的某些因素的更詳細說明，請參閱我們向 SEC 提交的文件，包括我們最新的 10-K 表年度報告和後續文件，包括 10-Q 表季度報告。我還想提醒您，在電話會議期間，我們將討論與 View 績效相關的某些非 GAAP 指標。您可以在新聞稿中找到這些指標與最接近的可比較 GAAP 指標的對照表。除非另有說明，我們在電話會議中的評論均指非 GAAP 營運結果。

Now I will turn the call over to our CEO, Dr. Rao Mulpuri. Rao, over to you.

現在我將把電話轉給我們的執行長 Rao Mulpuri 博士。拉奧，交給你了。

Thank you, Samuel, and thank you all for joining us this afternoon. During the call, we will address the results in the quarter, but also up-level the conversation to provide context on where we are and where we're going. Over the past year, with the dual realities of challenges in the real estate industry and the capital markets, we've continuously evolved our product, our operations, and our market approach to sustain our business, serve our customers, and importantly, continue to build long-term value at View. I'm grateful for the support and belief from our customers and Capital Partners, and I'm proud of the View team for focusing on the mission being learning oriented, being nimble and resilient, and delivering key outcomes for our customers and the company.

謝謝你，塞繆爾，也謝謝大家今天下午加入我們。在電話會議期間，我們將討論本季的業績，同時也會提升對話的層次，以提供有關我們目前狀況和未來發展方向的背景資訊。過去一年，面對房地產行業和資本市場挑戰的雙重現實，我們不斷發展我們的產品、我們的營運和我們的市場方法，以維持我們的業務、服務我們的客戶，更重要的是，繼續在View 建立長期價值。我感謝客戶和資本合作夥伴的支持和信任，我為 View 團隊感到自豪，他們專注於以學習為導向、靈活而有彈性的使命，並為我們的客戶和公司提供關鍵成果。

The Q3 results are a testament to that. Now let me provide a quick recap of the key announcements and results we reported today. First, in the third quarter, we showed continued progress on our path to profitability and significantly improved gross margin. We grew revenue 61% year-over-year in the quarter. Gross margin was positive without the impact of the future production outlook adjustments that Amy will describe in detail. Second, we're executing on our plan to reduce structural fixed costs and to lower the required revenue breakeven point in the business.

第三季的結果證明了這一點。現在讓我快速回顧一下我們今天報告的關鍵公告和結果。首先，第三季度，我們在獲利之路上取得了持續進展，毛利率顯著提高。本季我們的營收年增 61%。如果不考慮艾米將詳細描述的未來生產前景調整的影響，則毛利率為正。其次，我們正在執行減少結構性固定成本並降低業務所需的收入損益平衡點的計畫。

The third quarter results show a steep decline year over year in both our factory fixed costs as well as our operating expenses. Combining the improved gross margins and lower structural fixed costs, we're making significant progress in reducing our quarterly cash burn. Going forward, we remain laser focused on cash management and growing the business to achieve profitability. Third, in October, we were pleased to announce a senior secured credit facility from an Investor consortium comprised of strategic real estate Investors, Cantor Fitzgerald, RXR, Anson and Affinius. These strategic Investors are leaders in the real estate industry, and we're excited to partner with them to unlock the next stage of View's growth.

第三季的業績顯示，我們工廠的固定成本和營運費用均較去年同期大幅下降。結合毛利率的提高和結構性固定成本的降低，我們在減少季度現金消耗方面取得了重大進展。展望未來，我們將繼續專注於現金管理和發展業務以實現盈利。第三，十月份，我們很高興地宣布由策略房地產投資者、Cantor Fitzgerald、RXR、Anson 和 Affinius 組成的投資者財團提供優先擔保信貸安排。這些策略投資者是房地產行業的領導者，我們很高興與他們合作，推動 View 下一階段的發展。

Let's discuss our journey to gross margin and a little more detail. We made significant improvement to our gross margins year over year. This was a result of View team's focus, hard work, and continuous improvements made in several key aspects of our business. Anyone who knows a manufacturing-oriented hardware business with a new product category knows that this is a major inflection point in the business and proves out the unit economics, which in turn forms a basis for profitable growth in the future. For this milestone to materialize, several things needed to be delivered.

讓我們討論一下我們的毛利率之旅以及更多細節。我們的毛利率逐年顯著提高。這是 View 團隊專注、努力工作以及在我們業務的幾個關鍵方面不斷改進的結果。任何了解以製造為導向的新產品類別的硬體業務的人都知道，這是該業務的一個主要拐點，並證明了單位經濟效益，這反過來又構成了未來盈利增長的基礎。為了實現這一里程碑，需要交付一些東西。

First, continuous improvements in product architecture and material selection. Our fourth-generation product has all the key characteristics needed to scale to a high-volume mainstream product. Second, delivering on the key factory metrics while optimizing production and delivery costs and meticulously managing the supply chain. Third, continuing to scale the business with high-quality profitable projects. And fourth, unlocking value for both our customers and View with our fully integrated smart building platform and the investment tax credit.

一是在產品架構和選材上不斷改進。我們的第四代產品具有擴展到大批量主流產品所需的所有關鍵特性。其次，實現關鍵工廠指標，同時優化生產和交付成本並精心管理供應鏈。三是繼續以優質專案做大規模。第四，透過我們完全整合的智慧建築平台和投資稅收抵免，為我們的客戶和 View 釋放價值。

This journey is never a straight line to success given all the inputs and moving parts, but the trend line is clear. Our financial performance continues to improve with scale, and this provides confidence towards the path to profitability. As we zoom out and look at the cost structure of the entire business, we're committed to reducing quarterly cash burn and getting the business to cash flow positive. We took additional actions in October to further lower our structural fixed costs, including reductions in factory fixed costs and operating expenses. These actions are expected to reduce our cost structure below the already realized year-over-year savings that we reported in our Q3 2023 results.

考慮到所有的投入和變化，這趟旅程從來都不是一條通往成功的直線，但趨勢線是明確的。我們的財務表現隨著規模的擴大而不斷改善，這為獲利之路提供了信心。當我們縮小範圍並審視整個業務的成本結構時，我們致力於減少季度現金消耗並使業務實現正現金流。我們在 10 月採取了額外行動，進一步降低結構性固定成本，包括減少工廠固定成本和營運費用。這些行動預計將使我們的成本結構降低到低於我們在 2023 年第三季業績中報告的已實現的同比節省水準。

We're able to make these cost improvements because we have made great progress to date on the product, our market approach, and the factory operations. On the product, as I've mentioned before, we completed the release of our mainstream Gen 4 product. We recently completed the upgrade of unit and the software, and we fully released our multi-family offering. The maturity of the product means we're able to reduce R&D spend substantially.

我們能夠實現這些成本改進，是因為迄今為止我們在產品、市場策略和工廠營運方面取得了巨大進展。在產品上，正如我之前提到的，我們完成了主流第四代產品的發布。我們最近完成了單元和軟體的升級，並全面發布了我們的多戶產品。產品的成熟意味著我們能夠大幅減少研發支出。

On the factory side, we're performing well across key operating metrics, which allow us to reduce overhead and production costs. We are delivering exceptional products to our customers with on-time shipments to large flagship projects across the country. As part of our focus on reducing core quarterly cash burn, we made the strategic decision to rationalize our capacity ramp until we are cash flow positive. Consistent with this rationalized capacity plan and greater focus on our strategic accounts, and given the current demand dynamics, we're updating our full year revenue outlook to be in the range of $110 million to $120 million, representing 13% year-over-year growth for 2023.

在工廠方面，我們在關鍵營運指標上表現良好，這使我們能夠降低管理費用和生產成本。我們為客戶提供卓越的產品，按時出貨到全國各地的大型旗艦專案。作為我們減少核心季度現金消耗的重點的一部分，我們做出了策略決策，以合理化我們的產能提升，直到現金流為正。根據這項合理化的產能計畫和更關注我們的策略客戶，並考慮到當前的需求動態，我們將全年收入前景更新為 1.1 億至 1.2 億美元，年增 13% 2023 年的成長。

Now turning to our customers and the market. While the real estate industry continues to deal with the headwinds of office segment challenges and high interest rates, we see multi-family residential development being a bit more resilient at the macro level. Our dual value proposition of sustainability and delighted users, combined with the affordability of smart windows with the investment tax credit, plays well to the needs of the real estate developers in this segment. With these benefits, we continue to make progress in product evolution, awareness, and growth in the multi-family market. Just today, we announced that View has been selected for 89 Dekalb Avenue in Brooklyn, New York, developed by RXR. Likewise, developers nationwide are showing interest in View to differentiate their portfolios in a crowded market. As we continue to grow in this market, we expect that the multi-family residential segment will be a key driver of demand, enabling View to reach profitability.

現在轉向我們的客戶和市場。儘管房地產行業繼續應對辦公大樓市場挑戰和高利率的不利因素，但我們認為多戶住宅開發在宏觀層面上更具彈性。我們的永續發展和用戶滿意的雙重價值主張，加上智慧窗戶的經濟性和投資稅收抵免，很好地滿足了該領域房地產開發商的需求。憑藉這些優勢，我們在多戶型市場的產品演變、認知度和成長方面不斷取得進展。就在今天，我們宣布 View 已被 RXR 開發的紐約布魯克林德卡爾佈大道 89 號選中。同樣，全國各地的開發商都對 View 表現出了興趣，以便在擁擠的市場中使他們的產品組合脫穎而出。隨著我們在這個市場的不斷成長，我們預計多戶住宅市場將成為需求的關鍵驅動力，使 View 能夠獲利。

With that, I'll hand it over to Amy to cover the financials. Amy, over to you.

有了這個，我會把它交給艾米負責財務。艾米，交給你了。

Thank you, Rao, and good afternoon, everyone. I will be covering the financial results for the third quarter of 2023. As we get started, please note that unless otherwise stated, my comments refer to non-GAAP results of operations as described by Samuel at the beginning of the call. Please refer to the non-GAAP reconciliations in our press release.

謝謝拉奧，大家下午好。我將介紹 2023 年第三季的財務表現。請參閱我們新聞稿中的非公認會計原則調節表。

For the quarter, we reported revenue of $38 million, which represents a 61% year-over-year increase from Q3 2022, primarily due to growth in our smart Building platform revenues, driven by a continued and strategic shift to this line of business. smart Building platform is our fully integrated Smart Window platforms. And given the customer reception and inherent advantages to this product offering, we expect this to be our primary product offering on a go-forward basis.

我們報告的本季營收為3,800 萬美元，較2022 年第三季年增61%，這主要是由於我們的智慧建築平台營收成長，而這項成長是由對該業務線的持續策略轉移所推動的。智慧建築平台是我們完全整合的智慧窗戶平台。考慮到客戶的接受度和該產品的固有優勢，我們預計這將成為我們未來的主要產品。

Our revenues are benefiting from repeat purchases from existing customers and traction in the multi-family residential market. Additionally, the growth that we saw in our smart glass revenues was driven by a favorable product mix shift to our higher priced and higher margin products that are typically shipped towards the end of these projects. As we have fewer early-stage Smart Glass projects with IGUs in production following the shift to smart Building platform. Moving forward, we anticipate Smart Glass revenues to decrease and be a much smaller part of our total revenue.

我們的收入受益於現有客戶的重複購買以及多戶住宅市場的吸引力。此外，我們智慧玻璃收入的成長是由於有利的產品組合轉向價格更高、利潤率更高的產品而推動的，這些產品通常在這些項目結束時發貨。由於在轉向智慧建築平台後，我們的早期智慧玻璃專案較少，並且已投入生產。展望未來，我們預計智慧玻璃收入將減少，並占我們總收入的一小部分。

While we grew revenues year over year. Our Q3 2023 non-GAAP cost of revenues decreased 13% from Q3 2022. Reflecting the benefit of our lower fixed costs in the factory in the field and favorable product mix within and across the three major product offerings, partially offset by $6 million of charges for our changes in estimated future per unit IGU cost. As we have been discussing throughout this year, our lower fixed cost of revenues in the factory in the field, were driven by our cost savings initiatives put in place during the second half of 2022 and earlier this year. Revenue growth, coupled with our lower cost of revenues, resulted in continued significant improvement in gross margin.

雖然我們的收入逐年成長。我們的2023 年第三季非GAAP 收入成本比2022 年第三季下降了13%。 ，但部分被600 萬美元的費用所抵消我們對未來每單位 IGU 成本的估計變化。正如我們今年一直在討論的那樣，我們在 2022 年下半年和今年稍早實施的成本節約措施推動了我們現場工廠固定收入成本的降低。收入成長，加上收入成本降低，導致毛利率持續顯著改善。

This quarter, our gross margin increased by $21 million as compared to Q3 2022 and increased sequentially from Q2 2023 by about $9 million. Turning to operating expenses. We've incurred $8 million in non-GAAP research and development expense in Q3 2023, a decrease of 42% or $6 million from Q3 2022. This decrease was primarily driven by the completion of certain R&D projects as well as the realization of cost savings initiatives we have put in place. We anticipate that R&D expense will continue to reflect lower spending as compared to prior periods for the remainder of this year and into 2024 as we focus on cash profitability.

本季度，我們的毛利率比 2022 年第三季增加了 2,100 萬美元，比 2023 年第二季度連續增加了約 900 萬美元。轉向營運費用。 2023 年第三季度，我們的非 GAAP 研發費用為 800 萬美元，比 2022 年第三季度減少 42%，即 600 萬美元。已經採取的措施。我們預計，在今年剩餘時間和 2024 年，研發費用將繼續反映出與前期相比較低的支出，因為我們專注於現金獲利能力。

We incurred $16 million in non-GAAP SG&A expenses in Q3 2023, which decreased 20% or $4 million compared to Q3 2022, reflecting lower spend on legal fees following the completion of a restatement as well as lower sales and marketing expenses following our cost-savings initiatives. During the quarter, we noted a continued decline in economic and market conditions, including a continued and sustained decline in our market capitalization, rising interest rates, and a prolonged outlook for a continued slowdown in the real estate market. This combined with the limited amount of additional financing we secured and our revised projections for our future operating results culminated in a $170 million impairment charge to write down the value of our property and equipment.

2023 年第三季度，我們產生了1600 萬美元的非GAAP SG&A 費用，與2022 年第三季度相比減少了20%，即400 萬美元，反映出完成重述後法律費用支出減少，以及我們的成本支出後銷售和行銷費用減少。在本季度，我們注意到經濟和市場狀況持續下滑，包括市值持續下降、利率上升以及房地產市場持續放緩的長期前景。再加上我們獲得的有限額外融資以及我們對未來營運績效的修訂預測，最終產生了 1.7 億美元的減損費用，以減記我們的財產和設備的價值。

Additionally, following the revisions to our outlook for future production, we determined that our estimated future cost of IGU production would be higher on a per unit basis and recorded $6 million of charges this quarter. $4 million to increase our warranty liability and $2 million to increase our contract loss accrual. We have further reduced our factory fixed costs as we focus on strategic volume growth with higher quality projects with favorable economics. And we are running the factory with this rationalized capacity model. It is important to note that these charges do not result in higher cash outflows for factory costs.

此外，在對未來生產前景進行修訂後，我們確定未來每單位 IGU 生產成本預計將會更高，並在本季度記錄了 600 萬美元的費用。 400 萬美元用於增加我們的保固責任，200 萬美元用於增加我們的應計合約損失。我們進一步降低了工廠的固定成本，因為我們專注於策略性的銷售成長，以及具有良好經濟效益的更高品質的專案。我們正在以這種合理化的產能模型來運作工廠。值得注意的是，這些費用不會導致工廠成本現金流出增加。

For the third quarter of 2023, we reported a $30 million improvement in adjusted EBITDA with a loss of $23 million compared to $53 million in Q3 2022, reflecting the impact of higher revenues, improving gross margins, and lower operating expenses. Now turning to cash. We ended the quarter with $51 million of cash and cash equivalents compared to $80 million as of June 30, 2023. Cash used in operations for the third quarter of 2023 was $32 million, a $19 million improvement compared to the third quarter of 2022 and a sequential improvement of $15 million from the second quarter of 2023.

2023 年第三季度，我們報告調整後 EBITDA 成長 3,000 萬美元，虧損 2,300 萬美元，而 2022 年第三季為 5,300 萬美元，反映出營收增加、毛利率提高和營運費用降低的影響。現在轉向現金。截至本季末，我們的現金和現金等價物為5,100 萬美元，而截至2023 年6 月30 日為8,000 萬美元。增加了1,900 萬美元，年成長較 2023 年第二季較上季增加 1,500 萬美元。

On our last earnings call, we said that we anticipated cash burn would improve in the second half of 2023, driven by leverage from higher revenues with the lower fixed cost structure following our recent cost savings initiatives. And we're seeing these results in the third quarter. On October 16, we announced the closing of a $50 million senior secured credit facility from an investor consortium comprised of real estate investors. Initial net proceeds from this facility were $10 million, and we anticipate additional draws of $37.5 million over the next two quarters, subject to meeting certain covenants within the agreements. We believe cash on hand in combination with the projected draws from the credit facility should be sufficient to fund our currently anticipated operating and capital requirements into but not through the first quarter of 2024. This timeframe gives us runway to continue to execute our business and demonstrate reduction in cash burn as we look to finance the business to cash flow positive.

在我們上次的財報電話會議上，我們表示，我們預計2023 年下半年的現金消耗將會有所改善，這是由於我們最近的成本節約舉措帶來了收入增加和固定成本結構降低的槓桿作用。我們將在第三季看到這些結果。 10 月 16 日，我們宣布完成由房地產投資者組成的投資者財團提供的 5,000 萬美元優先擔保信貸融資。該融資的初始淨收益為 1,000 萬美元，我們預計未來兩季將額外提取 3,750 萬美元，前提是滿足協議中的某些契約。我們認為，手頭現金加上預計從信貸安排中提取的資金應足以滿足我們目前預計的營運和資本需求，但不能持續到2024 年第一季。跑道減少現金消耗，因為我們希望為業務提供資金以實現正現金流。

With that, operator, we will turn it over for questions.

這樣，接線員，我們將把它移交以供提問。

Thank you. We will now be conducting a question-and-answer session. (Operator Instructions)

謝謝。我們現在將進行問答環節。 （操作員說明）

Graham Price, Raymond James.

格雷厄姆·普萊斯，雷蒙德·詹姆斯。

Hey, good afternoon, guys, and thank you very much for taking the questions. I guess first of all, well done on gross margin turning positive, excluding the $6 million charge. I did want to get some clarification on I guess, why that would impact the current quarter if it's tied to future per unit costs and then maybe more broadly -- realizing that you have yet to give guidance for 2024. But just directionally, how do you see margins progressing from here? And then maybe talk a little bit about where you see the longer-term margin profile kind of shaking out?

嘿，大家下午好，非常感謝你們提出問題。我想首先，不包括 600 萬美元的費用，毛利率轉正方面做得很好。我確實想得到一些澄清，我想，如果這與未來的單位成本掛鉤，那麼為什麼會影響當前季度，然後可能更廣泛——意識到你還沒有給出2024 年的指導。影響您看到利潤率從這裡開始提高嗎？然後或許可以談談您認為長期利潤狀況的變化？

Yes. So Graham, this is Rao. Let me take the second question, and I'll hand it to Amy to explain the $6 million charge -- second part of the question. So on gross margins going forward, as you know, our margin line hasn't been a perfect straight line, but the trend line is clear. We have the product, architecture, the materials, which is foundational to margins, as you know, in any hardware company. And then as a manufacturer, we also have the right production metrics and the supply chain all worked out. So basically, the invention and engineering are complete and what's in front of us is scale. And to achieve scale obviously, we need certain number of minimum projects to get there. We have the unit economics worked out. We have the business model proven, and we're going to focus pretty heavily on the multi-family sector, although we still have a really good healthy airports business, we have a healthy institutional business and growing, but importantly, there's still office builds, life science and renovations going on.

是的。格雷厄姆，這是拉奧。讓我回答第二個問題，我將把它交給艾米來解釋 600 萬美元的費用——問題的第二部分。因此，就未來的毛利率而言，如您所知，我們的利潤線並不是一條完美的直線，但趨勢線很清晰。如您所知，我們擁有產品、架構和材料，這是任何硬體公司利潤的基礎。作為製造商，我們也擁有正確的生產指標和供應鏈。所以基本上，發明和工程已經完成，擺在我們面前的是規模。為了實現規模化，我們需要一定數量的最小項目才能實現這一目標。我們已經計算出了單位經濟效益。我們的商業模式已經得到驗證，我們將重點關注多戶住宅領域，儘管我們仍然擁有非常良好健康的機場業務，我們擁有健康的機構業務並不斷增長，但重要的是，仍然有辦公大樓建設、生命科學和整修正在進行中。

But as a growth area, we worked very hard at it and lucky that we've been able to get the product completed and be ready for multi-family specifically. Within that the relationships we've built over the last three, four years with installations in key markets. And obviously, our backers being active in this market is really helpful to us going forward. So the best way I would address kind of how this coming quarter looks and going forward is we have all of the right cost structures in place, including the lower breakeven point. And now it's about growing in that segment, and it will be on a quarter-to-quarter basis, potentially bumpy. But the long-term trend is to use the positive contribution to get to profitability. And as far as 2024, as I said, we're pretty heavily focused on the multi-family sector, and we're not yet guiding for revenues next year. But I think we'll do that in the next call.

但作為一個成長領域，我們非常努力地工作，幸運的是我們已經能夠完成產品並為多戶住宅做好準備。在過去的三、四年裡，我們在主要市場的安裝中建立了良好的關係。顯然，我們的支持者在這個市場上的活躍對我們的前進確實有幫助。因此，我要解決下一個季度的情況和未來發展的最佳方法是，我們擁有所有正確的成本結構，包括較低的損益平衡點。現在，該領域的成長將按季度進行，可能會出現坎坷。但長期趨勢是利用正面貢獻來實現獲利。正如我所說，就 2024 年而言，我們非常關注多戶住宅領域，而且我們尚未對明年的收入做出指導。但我想我們會在下次通話中這樣做。

With that, Amy, do you want to address the $6 million question?

那麼，艾米，你想解決 600 萬美元的問題嗎？

Yes. Graham, so we have two liabilities on our balance sheet that require us to project future cost of manufacturing on a per unit basis. First, on the warranty liability, we took $4 million charge. As we've explained in the past, with the fixed nature of our manufacturing costs, our unit economics can vary significantly with volumes. And so given the reduced outlook that we have for future production requirements, those unit economics for our future warranty replacements are now expected to be higher than we previously estimated.

是的。格雷厄姆，所以我們的資產負債表上有兩項負債，要求我們以單位為基礎預測未來的製造成本。首先，在保固責任方面，我們收取了 400 萬美元的費用。正如我們過去所解釋的，由於我們的製造成本是固定的，我們的單位經濟效益可能會隨著產量的變化而顯著變化。因此，鑑於我們對未來生產需求的預期降低，我們未來保固更換的單位經濟效益預計將高於我們先前的估計。

Now I know on the contract loss accrual, we estimate -- we have to record a liability for the total amount of cost that would be in excess of a contract revenue price, and that total cost includes the cost of manufacturing. So essentially what we have is a higher percentage of our factory fixed costs that are being allocated to the smart building platform projects that are currently being manufactured.

現在我知道應計合約損失，我們估計 - 我們必須記錄超過合約收入價格的總成本金額的負債，並且總成本包括製造成本。因此，從本質上講，我們的工廠固定成本中有較高比例被分配給目前正在製造的智慧建築平台專案。

Okay. Understood, and thank you both for the color on those items. I think, Rao, you touched quite a bit on my second question, but obviously, we're still seeing a lot of pressure in the commercial office market. Was wondering if you could talk about some of the other end markets, which you did a little bit, airports, health care, obviously multi-family housing and maybe specifically on the impact from interest rates that your customers are experiencing in each of those markets?

好的。明白了，感謝你們為這些物品提供的顏色。我認為，Rao，你對我的第二個問題有很多了解，但顯然，我們仍然看到商業辦公市場面臨很大的壓力。想知道您是否可以談談您做過的一些其他終端市場，機場，醫療保健，顯然是多戶住宅，也許特別是您的客戶在每個市場中經歷的利率的影響？

Yes, I think our business can be broadly broken into, let's say, infrastructure and government spending and let's say, private sector. My comments, obviously the interest rates and the dynamics apply to the private sector, so let's focus on that for a moment about what's going on with our customers' businesses. One lens is how are their economics looking? And this is a generic answer. Obviously, every project is different. But they have a trifecta of issues that our customers are facing. Number one, construction costs are still somewhere around 10% to 20% higher than they were before the pandemic, let's say, if you take the baseline of about two years, ago. And that's driven by a variety of factors -- probably -- labor cost is the biggest one, but clearly cost to build is higher than it was.

是的，我認為我們的業務可以廣泛地分為基礎設施和政府支出以及私營部門。我的意見是，利率和動態顯然適用於私營部門，所以讓我們暫時關註一下我們客戶業務的進展。一個鏡頭是他們的經濟狀況如何？這是一個通用的答案。顯然，每個項目都是不同的。但我們的客戶面臨三重問題。第一，如果以兩年前為基準，建築成本仍比疫情爆發前高出 10% 至 20% 左右。這是由多種因素驅動的——可能——勞動力成本是最大的一個，但顯然建造成本比以前更高。

The second is cost of debt and which a lot of our commercial customers take on debt, at least during the construction phase, and then they either refinance or sell the property after they stabilize it. So cost of debt is a very important metric for them in total cost and their own returns. And as you know, interest rates are about double where they were. So their cost of debt is twice. On the revenue side, for a while, the leases and rents were going up, especially in the multi-family segment. And now the rents are a little bit more in threat, and it's either an unknown or a potential stabilization of rents. So when you take the three factors together, it's a less competitive time or it's a less lucrative time to be building.

第二個是債務成本，我們的許多商業客戶至少在施工階段承擔債務，然後在穩定後再融資或出售房產。因此，債務成本對他們來說是總成本和自身回報的一個非常重要的指標。如您所知，利率約為原來的兩倍。所以他們的債務成本是兩倍。在收入方面，有一段時間，租約和租金都在上漲，特別是在多戶住宅領域。現在租金面臨的威脅更大一些，租金要么是未知的，要么是潛在的穩定。因此，當你將這三個因素結合在一起時，你會發現這是一個競爭較少的時期，或是一個利潤較低的建設時期。

Having said that, there's still a very heavy housing shortage. And there are haves and have-nots. There are customers that are able to finance in this segment in this -- in this timing. And the customers that are able to still build. And some of our development customers instead of building four or five projects a year, they may be building two or three. And then geographically, there are submarkets that are very hot, and people are continuing to build. So with all those while the macro is depressed, there's still enough business for us to go after in the multi-family segment.

話雖如此，住房短缺仍然非常嚴重。也有富人和窮人。有些客戶能夠在這個時機為這個細分市場提供融資。以及仍然能夠建立的客戶。我們的一些開發客戶不是每年建立四個或五個項目，而是可能建立兩個或三個項目。然後從地理上看，有些子市場非常熱門，人們正在繼續建設。因此，儘管宏觀經濟不景氣，但多戶住宅市場仍有足夠的業務可供我們追求。

Specifically, if you look at our value proposition, we help our customers to differentiate their properties, right? So in a tighter market environment and a flight to quality where they're trying to one-up each other to gain that tenant or get a little more rent. We provide an important amenity. We are long-term and sustainable for them with their goals for building more efficiently -- providing a path to net zero, saving a little bit of energy. But importantly, this is an amenity users love. That's actually the main and we're being successful in this segment. We have very strong user affinity. And now the Inflation Reduction Act and the tax credit on the smart windows makes smart windows now affordable. Their either same cost net of the tax credit. But in a few cases, we're actually saving them a little bit of money. So that's why we're bullish and focused on the multi-family segment.

具體來說，如果您看看我們的價值主張，我們會幫助客戶使他們的財產脫穎而出，對吧？因此，在更緊張的市場環境和對品質的追求中，他們試圖互相競爭以贏得租戶或獲得更多的租金。我們提供重要的便利設施。我們對他們來說是長期且可持續的，他們的目標是更有效率地建造——提供一條實現淨零排放的道路，節省一點能源。但重要的是，這是使用者喜愛的便利設施。這實際上是主要的，我們在這一領域取得了成功。我們有非常強的用戶親和力。現在，《通貨膨脹減少法案》和智慧窗戶的稅收抵免使智慧窗戶現在變得負擔得起。扣除稅收抵免後，它們的成本相同。但在某些情況下，我們實際上為他們節省了一點錢。這就是我們看好並專注於多戶住宅市場的原因。

To your question on other segments, airports, as you know, primarily, they're owned by cities or local counties. There's a lot of investment going on in airports across the United States, perhaps partly because for decades, there have been an underinvestment in infrastructure in general and specifically airport facilities. But secondly, as you know, passengers have gone back up to pre-pandemic levels. Airlines are demanding that the facilities to be built to a better standard because a better on the ground experience provides a better in the air experience. And airports are building and renovating pretty much across the board. We are in about 15 US airports and growing and have significant repeat business where they're building another terminal or renovating in that space. Healthcare also is facing some of the same financial challenges, but there are hospitals and medical office buildings being built.

對於你關於其他領域的問題，如你所知，機場主要由城市或當地縣擁有。美國各地的機場正在進行大量投資，部分原因可能是幾十年來，一般基礎設施特別是機場設施的投資不足。但其次，如您所知，乘客數量已恢復到疫情前的水平。航空公司要求設施按照更高的標準建造，因為更好的地面體驗可以帶來更好的空中體驗。機場正在全面建設和翻新。我們在美國大約 15 個機場開展業務，並且不斷成長，並且擁有大量重複業務，他們正在建造另一個航站樓或在該空間進行翻修。醫療保健也面臨一些相同的財務挑戰，但醫院和醫療辦公大樓正在興建中。

And then finally, in the office sector. While everyone talks about work from home, I think you're seeing major employees or employers are bringing people back to work maybe at least three days a week, in some cases, five days a week. And obviously, they're filling up their existing footprints. But importantly, the key sub trend to note, which really makes a big difference for View is the flight to quality is most evident in this sector. For example, in New York City, there are $150 per foot offices that are full, under $50 per foot offices, not too many blocks away that are empty. And what it does show is every employer is, obviously, not only having a strong desire or requirement to bring employees back, but they're using their facilities, the buildings as amenities to create a type of environment and culture that they want to bring their employees place back to.

最後，在辦公領域。雖然每個人都在談論在家工作，但我認為你會看到主要員工或雇主讓人們重返工作崗位，可能每週至少三天，在某些情況下，每週五天。顯然，他們正在填補現有的足跡。但重要的是，需要注意的關鍵子趨勢對 View 來說確實有很大的不同，那就是對品質的追求在這個領域最為明顯。例如，在紐約市，每英尺 150 美元的辦公室已經滿員，而每英尺 50 美元以下的辦公室則沒有太多街區空置。它確實表明，顯然，每個雇主不僅有強烈的願望或要求讓員工回來，而且他們正在利用他們的設施、建築物作為便利設施來創造他們想要帶來的環境和文化。到了那裡。

So in that sense, even though on a per square foot basis, it's a higher cost to build a better spec building, to get into a lease with a better spec. Those are getting more traction, which means you should see, even if there isn't a new build, renovation of these old, tired properties in order to reposition them for a more modern and more leasable environment. And we already have done renovations over the years. We continue to have renovation business in the right markets with the right locations. And that will continue to be a segment. But may make no mistake, we're heavily focused on multi-family as a segment for us to get to profitability.

因此，從這個意義上說，即使以每平方英尺為基礎，建造更好規格的建築、簽訂更好規格的租賃合約的成本也更高。這些越來越受到關注，這意味著即使沒有新建，您也應該看到這些舊的、陳舊的房產進行翻新，以便將它們重新定位為更現代、更可出租的環境。多年來我們已經進行了翻修。我們繼續在合適的市場和合適的地點開展裝修業務。這將繼續成為一個部分。但毫無疑問，我們非常關注多戶住宅，將其作為我們實現盈利的一個細分市場。

Okay, understood. And maybe last one for me. I wanted to ask about the Mississippi factory. I think you're still running at less than 10% utilization. So just as a way to get some extra revenue in the door and light of, I guess the revised growth outlook, would there potentially be a possibility of -- for example, leasing out some of that space or maybe partnering with another manufacturer?

好的，明白了。也許對我來說是最後一個。我想問一下密西西比工廠的狀況。我認為您的運行利用率仍然低於 10%。因此，作為獲得一些額外收入的一種方式，我想考慮到修改後的成長前景，是否有可能——例如，出租部分空間或與另一家製造商合作？

Yes, good question. Obviously, Graham, we're always looking at how can we cut our structural costs and why while ramping thoughtfully to get to profitability. I mean, this is a purpose-built facility. We have about $400 million of hardware. If you go inside and look at the facility, it's a large infrastructure, industrial tech combined with semiconductor technology. So its purpose built to make smart windows.

是的，好問題。顯然，格雷厄姆，我們一直在考慮如何削減結構成本以及原因，同時深思熟慮地獲利。我的意思是，這是一個專門建造的設施。我們擁有價值約 4 億美元的硬體。如果你走進去看看這個設施，你會發現它是一個大型基礎設施、工業技術與半導體技術的結合。所以它的目的是製造智慧窗戶。

It's not really capable of being broken up and used for other purposes. Our goal is to fully fill this facility as we ramp up. And as you've noted, at a fraction of the full capacity, we will be cash flow positive. So we've cut our cost structure quite a bit and continue to look for ways to be more and more efficient. I think breaking it up and using it for other uses is not one of them. But using the facility we have thoughtfully and ramping our business appropriately is what we're focused on.

它實際上並不能夠被分解並用於其他目的。我們的目標是隨著我們的發展，充分填滿該設施。正如您所指出的，僅佔全部產能的一小部分，我們的現金流量就會為正。因此，我們大幅削減了成本結構，並繼續尋找越來越有效率的方法。我認為將其分解並用於其他用途不是其中之一。但我們的重點是深思熟慮地使用我們擁有的設施並適當地擴大我們的業務。

Got it. Understood. Thank you for taking my questions. I'll jump back in the queue.

知道了。明白了。感謝您回答我的問題。我會跳回到隊列中。

Thank you, Graham.

謝謝你，格雷厄姆。

Thank you. We have reached the end of our question-and-answer session. I would now like to turn the floor back over to Rao Mulpuri for any closing comments.

謝謝。我們的問答環節已經結束。現在我想將發言權交還給 Rao Mulpuri，徵求結束語。

Thank you all for joining the call today. View continues to make progress on our path to profitability and our third quarter results demonstrate our steadfast focus on cash management and reducing cash burn. We've taken the right actions to lower our structural fixed costs and lower the required revenue breakeven points for the business. Importantly, we continue to make progress on delivering high-quality products at scale, keeping our promises to our customers and moving the industry forward. We look forward to speaking with you again when we report the full year 2023 results. Thank you.

感謝大家今天加入電話會議。 View 在實現盈利的道路上繼續取得進展，第三季度的業績證明了我們對現金管理和減少現金消耗的堅定關注。我們採取了正確的行動來降低結構性固定成本並降低業務所需的收入損益平衡點。重要的是，我們在大規模提供高品質產品、信守對客戶的承諾並推動產業向前發展方面不斷取得進展。我們期待在報告 2023 年全年業績時再次與您交談。謝謝。

Thank you. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.

謝謝。今天的電話會議到此結束。我們感謝您的參與。此時您可以斷開線路。享受你一天剩下的時間。