Sierra Wireless (SWIR) 23 Feb 222021 Q4 Earnings call transcript

Welcome to the Sierra Wireless Fourth Quarter and Year End 2021 Conference Call. I would now like to turn the call over to Mr. David Climie, Vice President of Investor Relations.

Thanks, and good afternoon, everybody. Thank you for joining today’s conference call and webcast.

are CFO. President today Sam CEO; call our Cochrane, the Phil and Brace, and On

reminder, presentations call. a on As today’s our be and website available will following the are being webcast

the regarding include Before started, securities the commentary statements. presentation expectations facts, outlook not certain we contains meaning constitute our laws. our objectives, business. are note and and that on I reference of Today’s information get statements strategy based for regarding goals, company’s the will forward-looking forward-looking statements cautionary These historical within statements

Our assumptions forward-looking be statements of are based on which significantly a number material to could prove incorrect.

statements known statements. forward-looking management’s significantly current statements, draw and implied and uncertainties unknown forward-looking are cause longer expectations, of that based or by those forward-looking time investors to material events differ relate risks caution Additionally, to on could or results particularly periods from attention that are substantial and actual expressed to our those I of we subject your risk our the as being our over be conjunction filings. our and quarterly to in well found update. as of can With our discussion presentation his I’ll release. should EDGAR that, This factors for earnings on which with Form longer Annual and other turn Discussion Analysis, quarterly in viewed to SEDAR & Management’s now also Information Phil regulatory call

two excluding the and years. earnings in call thank first a Thanks, year worked for was million, year-over-year XX% preceding joining business than in $X.X note. with to the revenue generated in XX% Total today. finish and the the the enabling team customers, was sequential guidance. more We In the and a on in Sierra in shipped everyone QX, revenue Adjusted challenging fourth in of David, quarter any sold quarter adjusted diligently positive on $X.X our net you $XXX.X we we and growth the us as delivered EBITDA growth three quarter in us XXXX. late half time million automotive fourth partners, suppliers, devices was the for positive that quarter a million ahead years, and

last demand environment. that to call to our we From with details on that capacity quarter our and and a facility, current our manufacturing production. and market. key now flexibility we to manufacturing existing accomplished the build improved product for We Combined I’d facility update adding to more have and Before our to during like conference building you the manufacturing and add planned production supply Mexican there, Sam supply the manufacturing that standpoint, over site ramping to our on new XG a achieve the facility The production of factor running said by manufacturing the shipped our with multi-factory customers we to quickly U.S. This be turn allowing can financials, year-end in chain us into current manufacturing I the three Vietnamese and chain enterprise capacity diversity capacity up additional of are QX so and view resiliency. customer us globally. and lines locations in ship and situation fourth existing an call Mexico. and XG the giving of was routers we’re provide

offense Regarding material secure strong investing our we industry to sheet raw parts to environment, balance the supply use components type year last supply. and decided chain in play and

strong to our did partners us customers to team procurement an demand. suppliers which our the and with Our quarter, respond exceptional fourth in enabled job

be said, to to into for can goods. be potential lead and strategy and Going components finished chips forward we impact with as remains will see That and continue outbreaks the we components, geographic in continue same times our the and we convert but mitigate believe a continue to to environment much of we make believe tight pandemic. the improved the position parts item, we investments diversity necessary better them so through COVID with a the supply watch us we’re XXXX. long

environments, we entered the regarding and in backlog our demand the XXXX have with devices current to demand history, company continue services. our strongest we Now for solid and

with customers smart We In our management. are in public seeing modules, and edge demand lighting meters, for add seeing infrastructure and and the enterprise, more safety IoT LPWA wanting particularly intelligence to the more we’re markets. energy industrial, great monitoring applications at space in asset doing products, public

seeing we as asset that with unique in strongly for at front such for as applications applications, markets, and enterprise traction seeing market with and gateways, be In IoT the Sierra of I strong demand come, tracking, also markets customers products Wireless, believe emerge. connectivity routers XG and transportation deploying IoT Series, the RV in of board fastest security. end our history. a we tracking solutions which modules, and offering At newest industrial more continue will across wave strong flexible public including SIM our are connectivity strong the we with energy in position to monitoring, IoT and XG, especially grow to as solutions, to our modules and industrial the And line networking. We’re enterprise product are years XR XG industrial demand applications services. demand have is our a and smart ramping for our our these XG, is safety,

to in the balance we his results. and record that in quarter Given sheet, the for IoT year-end going are we current fourth review in our Sam over combined forward. confident With turn backlog I’ll the that, grow with profitably call strong can current trends the

report Good we on and U.S. U.S. everyone, basis. note GAAP Thank financial dollars that a you, our results Phil. afternoon in

same provide website. results non-GAAP is fourth the million our present was XX.X% a to quarter performance, last to a up $XXX.X results our non-GAAP between operating year. the period reconciliation We on better revenue understanding also a GAAP in our Total compared available $XXX.X million and of full

and was $XX.X the efficiency compared XX% Non-GAAP to XX% fourth in IoT million $XXX.X in grew Solutions Enterprise operating was and expenses production $XX.X QX Looking XXXX. prior profit sourcing basis million with year-over-year in was as continued materials, was revenue raw quarter year-over-year. million fourth was initiatives $XXX.X were up million we’ve the XX% margin by year-over-year. to up increased from coupled two performance manufacturing software company. X.X% at $XX.X XXX capacity the or the due as QX fourth QX improved important segments, $X.X been QX as two at to to in In ongoing year-over-year. XX% services quarter strong points our by increase Solutions were XX% certifications of in OpEx quarter our additional up moved Gross demand into manufacturing compared year. brought of QX to Gross down Sequentially reflects and product throughout was product million This additional an the the the components. slightly, parts million QX. that revenue QX was year. that compared improved The $XX.X a revenue up primarily well fourth connectivity profit revenue primary quarter to the prior undertaking on million we due facilities, higher XX.X% the cost

was CapEx across our As of OpEx adjusted mentioned positive ago. areas In million negative call, year to and $X.X of last EBITDA all to continue manage in $X.X tightly our adjusted a million business. QX, the we compared EBITDA our

XXXX, increase was over year year. full X.X% the of the $XXX.X For revenue total million previous an

For was the year. prior XXXX adjusted $XX.X year to full in negative million compared EBITDA $X.X negative the million

million $XX.X XXXX ended balance Moving quarter. fourth we sheet, in with CapEx and million operations from flow of positive $X.X the to $X in million was quarter was cash. Cash the of the QX

an $XX facility facility and greater the support supply we This our balance announced interest and parts we CIBC million. our us inventory to that growth. business strengthens has approximately in components had sheet, a the BDC giving to as debt attractive continued During investing rate grow fourth of In our with mid-January, going forward. quarter, and a and flexibility company secured secure debt operate stable for new of strategy we currently

on global COVID-XX business, continues the overall on our to pandemic experience guidance we uncertain, business effects of the continue remain Regarding first the for our while to and evaluate quarter, the the impact related and of XXXX duration operating beyond for remainder cannot at this of to impacts flows business, reasonably the on and our severity results condition, financial estimated be time. COVID-XX cash adverse and

strong. Phil very global for remains As our products mentioned, demand

turn environment, to guiding Given of quarter a in the we this million $XXX over of please now open lines. call questions. range $XXX.X first to million midpoint the the revenue that, $XXX will are year I a of million. With Operator, with the

question, our Searle [Operator have your first Scott, we is Instructions] line Capital. Roth from Scott open. For

first and had if gross wondering then where Hey impact component another in guidance, given units, Thanks afternoon. we my you quick the on just business gross taking follow-up. any we’ve your some you’re Nice could like about the what freight if for five profile quickly job quantify Hey, otherwise, I and was weeks quarter. left things, given you or I Excellent for the give of the call expedite And margin different clarification. then wondering was the of and maybe good us that and how guys. a Sam, idea sequentially maybe or quarter? I could quarter looks various costs in are thinking got margin the question.

for Thanks your questions.

is, bit more margin gross in obviously it. color going a we’re inflationary right a So, we’re guidance, we’re on period give to now. What give seeing not I’ll little very but

So, component parts increased we’re costs. from seeing pressure – component

other it, pressure strong demand margin in one on the on which side put bit is part as seeing part, little well. other of we’re of a but that does the exciting very modules, On and gross

margin expect just we’ll of I those to over QX and continue near-term given But in uplift it discussed. the So, in XXXX. sort pieces discussed rise no have to out do flattened two sharp I gross see previously that

in early, and Tremendous Very Got modules. at I is peak in, levels XXX enterprise we’re Phil, guess but Right? to it. is, think days could, I in near it’s the this enterprise side business. I side back module I point still And helpful. turnaround time. know the almost of if

be we’ve the today, us a we these I going and look business, could wondering, that said, could Thanks. more seen just there profile it know of but availability, this that normalized or to if As years. supply gross seen are what to the like are tremendous. think big highest I the I the quarter, act is understand that subject snapback better is sustained level of chain? for kind about the to Is building as demand a component a profile, enter snapback? just those module it’s sustainable the three Is I’m that it’s in this this at we which was is give snap that What environment normalized businesses terms levels? you at looking supply some margin think environment? a up level targets guidelines in in

Yes. Thanks.

my lines. record backlog, mentioned me across that. to mean, basically Let answer kind I not record backlog. we We backlog have our try product basically best of have we that record do

So the is for good. demand products very

We so, in terms underwater see the guidance was the were our that, and said QX, This did the have back I mentioned QX, Having uniquely right, in for seen, in demand QX as some we there of certainly I is in module kind bit business. products strong. a that said QX. is impacted we snap of where volume. think, very most Having of a those into of reflected

and But in the keep company. than frankly, we down, to And improvements and to of to do. what continue that work good good growth as to continued competitive to on cost there what, our continued supply average leveraging dynamic should on gross model really well, such and I’m slightly margins the itself our see that working continue I’m profit. market have we frankly lower and the trying drive growth tends lend to chain, the That’s so

and the of the modules are on enterprise the terms on businesses, lower three higher In side. it’s are side, obviously connectivity

kind of forward. out shapes that how that’s So going

point. all I In to now, XXXX terms sustainable, I this anticipate constrained right environment in going this is at we’re of supply through being mean of look be, a

are for components. we fight is So, strong. to Demand continuing very

just turn It’s finished that. all and them manufacturing parts can have to place the into be capacity the going in meet we We goods? get to

Great. so Great Thanks quarter. much.

Thank you

have For Mike, our Canaccord next from is Mike question, your Walkley we Genuity. line open.

your when and up just I feel the a congratulations get supply given type Scott’s for historically questions demand, for for tightness demand to to ability a I a the return couple components. you’ve Thanks obviously following backlog, low QX to the the on for see. keep know any seasonality non-GAAP quarters. to my taking trying is for at run components, next of record profit, revenue, so to point tough it’s does I’m team the get a just the on environment to questions these guess, great to on up year. thoughts Great. versus catch different get but of you rates for supply,

think as would current think any got environment. perspective focus you of have in the more seasonality I on Yes, sort point of seasonality, that seasonality on data any anyway. And through demand distorted out, we is would we’ve blow frankly, than I historical kind any certainly

seasonality, So, think now really much think quarter. guidance historic on don’t we facilities I globally, stuff get as the in given, securing any you components. that have good really try of and seasonality. we more of And range what have bringing with the been to grow. I what It’s can would think we seasonality. that can and backlog really to doesn’t see has say we continuing our what, reflected just of out continued do recover sort guidance can online we But the as around that I our that any in we’ve historic to

run relevant okay. follow-up $XXX did That’s As And line back XXXX the of Great. investors about $XXX predecessor in of that of report committed and you is targets, you. the million the And focus I your to Phil, million these Sierra still term Thank way you notice all these targets, June, longer change how should metrics just you to believe way on? think for what you items? I you, Wireless not, and a if some see business? the do

Obviously, make including that rate, few understood. I things when And to resulted and asking targets frankly, current did really in assume and us to pursue required those as it’s very people that losses for targets I frankly, focus confusing metrics run out, on those decisions. like run to you question. the those were Thanks LTAR pointed realistic [ph] that Yes. new not Yes. that we myself poor think think

this and targets growth. ago seeing an long-term So profitable Having on forward. strategy, be my both in our believe we’re it growing valid not holistically going believe important I profitably that, profitably for revenue demand I’m goal be short-term those part that will do years and going set to be currently building recurring focused growing but company isn’t the the on going very grow is to and strong long-term, are said were company to of I’m that three the the business products. do I a focused

kind it, for Wireless Great. think and that that, Thanks. last for are sheet time How see question it’s assume and competitors One cash strong next to terms quarters? lot area. me, balance high over great couple or about that their I’ll the levels Sierra should really we that should of way capital pass in minding inventory for in we and of to ask working of another line. your levels these just Appreciate the procure answer question, a of you, using Sam, to struggling just components,

Yes, good question.

right? So right? is build right very QX modules to the which going normalize, That gateways shutdown, to there’s routers. both up very, two and but demand on our was There that’s inventory, competing led things us our strong starting into happening,

So, while like protect and to look we’ve strong. remains to the that prices stuff we demand our raise done margins at very continue

having demand. So, to continue customer components meet to our to in we’re invest

is see demand in it of stay the play on So, that said, up where goal any depending half, right our metrics will go out But I the profitably down with you line over it. that sort flow. I you’ll But will this of is and grow in think see would deliver inventory second next of that ultimately few cash up year see free as quarters. inventory don’t movements how over impact now grow kind company, Phil flow. in obviously that play kind as free to out and the and on us cash big

others doing out sense. your better I Great. taking team to questions. said, be than guys the to my as congrats That makes components. And Thanks procurement getting seem like there for you

is Josh next Riley. B. our Josh, from we question, have open. your For Nichols line

the opportunities about Yes. improvement quarters? expect how a taking that pivoting question OpEx cost good free Thanks does cash On back some to the additional my flow should hold note, and of initiatives positive for lot generation. the see or company’s XQs think to some taking remain flow we cuts to to for coming to And free cash relative firm XXXX throughout there. make here,

Yes.

So good question.

we’re said I So before and the I’ll new grab think you up. looking Phil, to if at that it. The sort please way I’ve flat of add anything this is OpEx, have add is

up of the of means, expect which be this will inflation keeping model, and in sort get sort leverage flat. and at of much some range, OpEx wage But to it pace So small higher to call out at X% we lot a X% a most flat OpEx growing things. revenue of these

So OpEx. that’s common on a

Now, free very go demand working strong cash and good into demand. in meet into demand. our flow to to capital that to us visibility again, invest having is It’s going our continued,

sort position of cash working growth depending an those a free on deliver that So with and we flow, be capital capital eye those sense? working profit items, in on numbers. will make Does continued to

revenue demand out does year. just are What how this curious XQ, right. at book-to-bill, have I like the Do And least for of the for backdrop thanks record XQ? far that Anything visibility on, bit you you you much I’m as to you as going backlog, from quantify I look little that the know mentioned orders do could dollar kind that on a it, clarity. value opportunity a have Yes, or then like through mean, now?

Phil. ahead, Go

point. placing start Yes. orders not take orders, have to XXXX We customers into started we this at have to say, to

that the quarter, I bit first Well, bit fourth the than question, a usually historically, quarter. is seasonality little guess different me quarter okay. but a then I know for is little mentioned last you And softer this

that I assume have, kind continue revenue to million as of imply business? like progress ballpark you fair that guided would of like be think inventory somewhere how sales but with And base about this to build that’s and going that the of is kind throughout the probably with to out, so, good mean, year? able Is backlog that doing of grow if could a be kind the the it that $XXX the that chance around how to you the in shakes company the I year. you is like, there’s thinking you’re potentially

that to to want want it? take or crack one you me Sam, a at you take

Yes, one. that sure. in I could on jump

So yes, from the good $XXX.X growth look seasonality into you the all year, at million, that It that shutdown. is are midpoint QX. seeing question. we throughout odd sequential this impacts Like we the do a little bit see because still of wasn’t year, QX QX if guidance

going into to that’s of QX as Some go well.

sort of you of So $XXX bit if but little a million. basic start to a that’s of growth there, you sequential do mentioned pretty a $XXX.X math get you close. little and you million, bit mean of I hard, add through bit little

about hard, right. bit So, I but a to about thinking Maybe close tiny think you’re it accurately.

guys. Thanks

in hop queue. the else Someone

our next For question, your Soderberg Derek, line we have Colliers. open. Derek from is

for questions. guys taking Hey, my thanks

your a marks, in growing software connectivity. need prepared for about, Phil So and talked you

Is some a could it devices and attach recurring guess, bit guess would hardware, quarter data you puts in consumption, the number touch want lower be Just monthly I sales, grow and expected of more. would’ve lower on to the a quarters, Thanks. that rate, but I revenue in explain more guess from to I on I going prior year. just the I guess anything with great. strong there? exiting takes

to you of with there Look, pieces a lots that, an that going Having be that great of acquisitions a is the that our said were business overall are in important XX.X% question. as that’s there. of there lot part is know, lots It historically. continue grew made to of segment Yes, year-over-year. combined

strategically be kind up, deeper a There process in want implied some going particular of I’ve, going there aligned that’s area with in the may where little businesses stuff that aren’t we to before I’m to of that’s And go as stuff of frankly, doing that some there’s bit So there. dive down. go. a I some in there’s

doesn’t Just necessarily because MRR for has something us. it’s mean right

to I’ll and revenue is I’m it. going kind at that recurring There’s to and evaluate in different there, puts be be continuing building So important going of takes part, going continue to look to various forward. an

that, off I is declining, those a product that timeline it. out? there sort of Got lines sort when with And of then those just guess for base are

to we’re to, actually Look, business the focus, I’m to trying holistically. trying figure how overall out grow

So, comment premature it’s what’s of to a in there. on kind the of and little out

management you on walk is, away are think I both wheel. got the hands and team the need with what I to

allocating We’re this grow for going are, capital sure to and make drive the that the the areas right best to that profitably business. to we’re business have ROI

could in just think joined squeeze you know, one, on out when profitably, year Got year? laid initiatives near-term you’ve it. XXXX, the point these do in you for again, can you QX went initiatives? And if what strategic this if to of you this sort sort of what updated another Like you I you are I hiccup curious any through Phil divestitures, see of mentioned growing acquisitions, your sort want to you for initiatives

fair lot it I now. longer I’m feels than mentioned the to right actually it’s had days. mean, to stable is trying footing company I turbulence mean, like put think do pretty first what I fix, XXX on a that. think that I, a Scott say we’ve I Yes,

going frankly I’m to future makes think continued What look see areas. of minimum I double-digit we’ve is going expect kind actually EBITDA what of a when revenue some job as kind see we a think portfolio evaluation about the OpEx forward, navigating going whatnot. of focus throughout and pursuing taking margins and a done, growth I some expanding likely, margins unprecedented go expanding be of the to year, that of the kind sense, holding team’s done with I we profit great flat. forward will to on the

do a that. think inevitable I there. lot that’s that, consolidation in there’s the out think talk of about I industry,

for products have are I industry, and company, we in the making for and so, as interesting operate portfolio focused think the some opportunities now but right I’m me there do they best on And as we taking can. the and sure

it. Got guys Thanks

For we line Todd from our open. Todd, next is Coupland CIBC. question, have your

had a a and then Yes. Good just of a point evening question. clarification everyone. I’ve I

grew So being as is services revenue Because that that that those the also million, as that business defined XX%, MRR, recurring I is $XX some well. or connectivity in there’s solutions are interchangeable? think

that basically, right. small close small is see included amount Yes, by amount, that There’s get very essentially divided a for but there doesn’t MRR. three a to the number you

Okay. how and not And as et – businesses, it [ph] long-term that’s not the you’ll That’s cetera, there, stack, point the gets all the piece and the question, the that then LTAR some et keep grew around that around That’s is acquired MRR. all prior and was metric a MRR, relevant. the XX% and commentary takes fits, cetera. puts sure of right?

That’s correct. Yes.

grow of without So his holistically, my up of the is just sort profitably whole grow clear to to optic business Phil sort view focus services. trying that, make it on

he’s to point, the there. across that’s think I trying get So,

Yes.

Okay.

Yes. I didn’t no get be about period. to going longer that. The thing, we’re that talking LTAR

of bunch there’s that. So in a stuff

to hard a us was metric That regardless. for reconcile

it of here. business, you business of, how So is, been I Thank about of about is plus number coming pull about, thought that a know sort how you. lots questions your actually beyond right of growth think reference much pressing now? then what’s of you in slowly if of is Like, I’m like, just a the not in that surprised the And on. times or XG XG as Like three the factors tailwind demand. business? Then sort material pandemic maybe I the versus secular up much were kicking the about forward prepared to there’s what the the trends, qualitatively, a thinking think way? like we slow comments are other was and Yes. other two in

Yes.

try that. me Let

to IT One networks, And it’s guess of think, I me, mean, but it, what now, XG or long of grow. decade business behind you business, power a things, like of the a great, opportunities I’m that just about when of work just have, excited from the home meters, the of I in are just infrastructure, about of from think this the long-term feel mean, enterprise smart whole number smart things nascent space. excuse LPWA, is routers when as into energy is small I that us of having, XG the And just I in Right. private This that, not some number but front XG, it’s just deployments think I the manage some translated think about is point Low being growth starting tailwinds there, I there’s now opportunities think part space. out about idea great. our that growth of I in LPWA I get tremendous I excited just infrastructure connectivity. us, gateways, we all you

pandemic from that’s that around, that. going go impact, manufacturing, when to look manage I it was impacting remotely for recovering things think of being to you to only more and think pandemic, globally, back think monitor When idea trend. us, whole the whole this accelerate at to the able I to this our I

think you can That’s when often commoditized, competitive talking what bit you Yes. are have about double about then that advantages this business thought sort growth again helpful. little think a characterize of Sierra’s can And you’re strongest digit people about? drive Okay. that you

in is this. with competitors want Yes, that think is, we compete and I market that got some every look participate to we honestly,

that we space. that RF a key this think for at And I in think modules example, a capabilities, power western some very there’s valuable of I very, when our very as trusted there. are look and provider play can we low role performance,

solutions side, can build appropriately managed customers. They’re performance, I our XG more resonating connect marketplace up space, for anywhere network and value the connectivity the go a are the case, router with that reviews and have And their getting use the in to proposition world new that industrial products on Our a that’s the best is think targeted deploy good great. ruggedized and really ability at very to then their in managed is space. also which

our months to frankly, I about however, position competitive we that. we certainly do. going to work good I focused a can I a days, lot feel be have be lot I don’t mean, a things left my to team six is XXX do on to of more say So, and lot mean, are not And here. there’s competitive that that more and

And place with cash you sort just all of that to Okay. focus perhaps or strategy Sierra consolidator lot. some is consolidation, that, sort speculated on to your for question Thanks where cost last us the signaled understand, you have now Sierra’s and and Wireless consolidated. on commitment a whether Can your sector of the and you’re flow, just clarify as the me, company. a market, hoping help stance take in in

number portfolio a think it the divestiture Yes. is to things, I and likely with grow confusing it some been is mean, and grow equity some, that’s one we I confusing one and to that do frankly, the of story a the was Sierra we’re obviously the do. a Because doing me have an has acquisition. prior story. the company challenges to clean looking it’s what build up really, my value, profitably company, more frankly to and I focus am

We’re doing of a lot things.

divest clean to, likely term. them an and however businesses I’m prior of acquisition, some so And perhaps long the to smaller up more

space, think from could number, provides. you I in the whose for bigness is would which consolidation there’s a the clear of benefit scale players pretty it’s Sierra including is, argue,

likely right point I’m where now time. businesses think at prior from there. then divestiture go do kind returning have profitable and of profitability building to I the that to them focused likely we see on But is I’m we’ll growth. and in to that so acquisition that is, And we some

Thanks Appreciate the Right. color. all lot. a

you Thank

RBC Paul, your is Treiber next our have Paul Markets. from open. question, we Capital For line

Thanks now QX, that, the that million characterizing QX. also sound right? constraint in Sam, very revenue is $XXX constraint was manufacturing either for in good capacity, those for it availability, demand And then like the the and and doesn’t regards in afternoon. am getting that then QX component a much for to of outlook constraint QX, a is, for is I

our with We kind to back partners, because were I because ramp bringing were was we never up of coming QX a up bringing back we turbulent guess mean, Mexico. I there, were just really, starting I were out. Vietnam. We time,

and QX that I guess, say is probably then would So, manufacturing constrained. component was QX likely I constrained,

probably probably is make, close yes, but our dominated to More this statement I by but that’s think dominated think enough. supply. at this manufacturing point, QX way, own not QX and that’s is I it, by a okay perfect, more dominated fair it’s more component

footprint Okay. is component That’s XXXX, or I at securing but you manufacturing, what XXXX the out manufacturing component term supplies, helpful. And that then you probably mean as point the would to obviously look short on further? would focus through expand look

question. great we’ve talked a that’s about it. Yes, And

the are made have and beginning in strongly product at there ramp years. investments the demand we targeted that their some particular that out the believe We is of some lines part and

be I what that then think capacity, stuck, extra we when can’t and to I don’t get on want is supply. bring do the

components and looking line think terms in then a a to if that, I right. there. one be we’ll you it’s So, around visibility opportunity few for, demand look, to on I do, of enables supply be into a the of that be think many cautious of I’ve solid, balance should be But, of got clearly our us a that. stronger times And going to combination the but going things remains been sheet we’re to we more block I’ve like, that’s strong like that

fixed use if effect idle cautious adding capacity extra it. can’t sitting So, will on that I be I’m pretty

from And you to not if understand there? what’s us Are then, going that including doing customers record perishable? is, like, demand help or connectivity? Are can obviously you? it demand able are help like delaying it not it then, And shipments? supply, And if with it what supply secure like on they looks they the is understand just, us backlog, they’re outpacing you it can is is not

that not is with. that good I a news supply the talk [Technical question is, good Yes, when to dealing – customers, a them I a we bunch, are question. the oftentimes ask, And only my the is Difficulty]

recover situations, major QX were is were I we in to scrambling I own much more with which our mean, our why I be never a want customers. bottleneck, a from we we’re significant when really were in blocking think, situation that. to we dealing

think supply. our minimum are not trying they’re that own sure best in seeing I think what the to meet just I what seeing to we like, make And their we customers right our do quantities, situation. we’re in now is to our are blocker like So,

what doing going are for I think in lead just general, products customers are right. is our times up

that’s tend going times they out reschedule seeing. are just lead what it out and, So I’m what to do is time later in that’s

Okay. Thank you questions. my for taking

Okay.

further have don’t any this questions we at please time, continue. Presenters,

Okay.

The a we’ve done suppliers, very very appreciation XXXX. And express moment and been demand all certainly customers. we’re call. the The call. across challenging, challenging like I for to take bright. point this all the is strong. a collaboration is of the I It’s board. partners, with my Close and the our future employees, at partnership appreciate would a think got I

We to and forward. profitably execute well grow for are Thanks everybody’s joining call and going today. this going support company the

concludes all conference you participating. this call. today’s gentlemen, and Thank for Ladies

You may now disconnect.