CommScope Holding (COMM) 5 Nov 202020 Q3 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to the CommScope Third Quarter 2020 Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. I would now like to turn the conference over to your host, Mr. Kevin Powers, Vice President of Investor Relations. sir. ahead, go Please

are thank Morgan third joining Kevin quarter Investor Bud Pease, of me President and Executive Chairman and welcome and Watts, Chief Officer; Powers, today, Technology to of Alex today joining And our earnings Financial Relations. Board. Treadway, you morning, President us Chief Officer; for Chief and Vice Chuck Kurk, Good the call. and I'm Officer;

that Investor the on find this that of uncertainties Relations will website. today slides filings, could note of our our based our future can You business, future call contain Please and Please materially. that affect which and recent accompany differ see some view statements SEC comments the our identify actual risks performance. on forward-looking may our results current principal

call be results certain changes All comparing unless over noted. the and call to align second of Treadway. our discussion the morning's classification quarter presentation materials. presentation. to Chuck? the I described materials XXXX certain will we to disclosures are described CEO, the and detail over review. Chuck during other quarterly otherwise to a our and a our All in financial which posted reflects CommScope's are Chuck, references during non-GAAP our rates sequential turn discuss to items basis associated today's contained to few website. earnings measures, earnings growth turn in will today's will on more I Reconciliations adjusted this President Before of housekeeping are financial Today, and measures adjusted on non-GAAP or results just now in to

joining by I'm about and me CommScope what talking to I'd why road Kevin, like call. thank today's Thank and you the brought to all about ahead. excited for you, start

strong I've team legacy a drive takes career, focus and What passion of has most as its a deep and as maintain with into CommScope the team revenue shareholder Industries. a growth insight leadership spent to and I background of value apply and businesses. R&D. revenue me At managing I together. the industrial-focused problem innovation built a to to growth value, global range across business industries, that excited it big experience team joined of meaningful product how Over industry on succeed. increased sales, serving And the years XX businesses of is and for Industries, to above-market a for solving, my understanding this drew and CommScope CEO recently developed Accudyne course I what of creation. including investments to technology marketing CEO. I'm Accudyne my my through role after innovation and I worked my in drive last to and the

strength dedicated solid as cost is team discipline focus pricing, and to addition, around to was few and congruent months, on and In implemented drawn assess G&A CommScope's companies the cash resulting I of and our savings, This to forward I've significant I working business with EBITDA thoroughly focused Over we board led, the our purchasing my with closely in cost next improvement. on management foundation. areas to look work having build management. and initiatives

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level First service. off, teamwork I was strong culture employee the of commitment and struck of by the and

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innovate we Thanks, boundaries Across to entire problems. and business, key the customer technology Chuck, good everybody. solve and push morning, to continue

hurdles. as NovuX a brand X are face we under gaining the progressing networks, to they industry-leading of key architectures Fiber the sealing are In development applications our areas lineup driving solutions support a new customers We for new in migrate our broadband central to and are programs and to traction.

we In with DOCSIS advances our help copper upgrade splits. at and our the equipment fiber and are network with addition, complementing node to solutions capacity customers core

on are indoor Remote and DAA architectures years. in also working virtualization with Remote Campus product MAC-PHY our gain will of future next-generation on addressing to which and new PHY needs Our efforts extensions. be In X.X DOCSIS Venue customers' are solutions, we continue track, features. We're Networks, deployed and

with and indoor of continued critical coverage applications sales bandwidth solid XX% RUCKUS growth, control of cloud access more Wi-Fi with than new for X. the seeing As platforms and becomes all X now being more points demand our Wi-Fi we're introduction

devices. provide solution Our of better provisioning capacity for and cloud a newer now and ease our and speeds both have monitoring on-prem-based devices greater solutions are enabling We which controllers, greater existing for for equipment. complete

with of virtualized ONECELL, a small its to cell, software we solution. values developing continues enhancements version we're new introduce leases feature new Our XG the prove as and

to our flexibility the improve than with fiber quarter-over-quarter increase. XX% we hyperscale, and continues delivered customers, speed of efforts connectivity to another delivery with more and increase resonate in Finally, quarter record

Turning to lines. we're our strides networks, expanding Wireless product immense Outdoor flexibility making in breadth of across the

modularity driving into time. that pre-terminated we're example, manufacturing For dramatically in FiberFeed customer resulting improve efficiencies our delivery HELIAX

to solution to been capability deployed PowerShift has from provides over a extended tower we with compared support as macro with the importantly Metro layer move estimated a This network demonstrating In the building for the layer are cabling. Cell, grid in be is PowerShift the costs will it XG. AC When of fiber cost-effective kilometers. and the now kilowatts an reduction to network and metro XX% critical the addition, fiber, capacity to installation power of discrete hybrid to line our

reallocate macro and the tower loading towards reacting tower, wind to more antenna to developing this and primary takes position streaming low-band resources need quickly continue space techniques to place. to we concerns. new the Finishing by drive devices ensure to invisible addresses we which high-band as with Home elements, a are we're elements transition have see we a Networks, size on minimize making for Lastly, reduces and

which retail would expand and e-learning. to service network platforms a help critical become improve also work-from-home uplink element and both gateways, provider We for and the capability huge continue and to X.X and the to DOCSIS manage of the develop downlink shift for

us and will our technologies, devices in applications New X give like with greater to Wi-Fi XE opportunities even the streaming support future.

strategy key industry. will XXXX to and address ahead Looking reshape to our the to is that our technology beyond, leverage trends our

the Before the a greatest to attention. that Alex, over moment think highlight I'll take our I deserve to we call turn ones

increased is C-band, T-Mobile; First, which auctioned; the recently start we with In the between foundation auctioned wireless operators consumer being is by for XG become the drive potential. spectrum This but expect home. in spectrum. spectrum, for will fixed-line was between States, operators that United which and that which in and for gigahertz, the the only collection enables not the competition owned including wireless reach its December, will the battle also let's X.X mobility, wallets of CBRS, to

the other parts of the these just not but in in States, occur world. expect We United will battles

strategies, for high-split particularly to through node fixed-line in now access, demand and the expect mid-splits number this the the As will connectivity to upstream improving and crisis, impact we how Operators continue operators impact likely through the the in given a put essential enhance XXXX, continue networks COVID Broadband segmentation has spectrum were including to the the the foreseeable architectures. available test future. bandwidth uplink, on to increasing become will the and COVID-XX home. throughout focus need world by of

will the continued virtualization see the support transition to to While to is provide to This includes technologies. come. X.X migration focus future. DAA existing well network slow will needs next we place due to long-term years and migration DOCSIS urgent consistent and capacity the capacity network take more expansions, on This expect end-user investments to and decade over lead expected for the to the from into

PON service operators to Digital the even for We companies, United most will States, of allocating America fixed-line To rural improving government competition for companies funding satellite is the also support between is wireless that cable billion in one be and RDOF, market coverage. will the the bring end, technologies. broadband. Opportunity for see exciting toward the new Carriers, and $XX rural creating the connectivity coverage. of next Fund, Rural the or decade compete rural opportunities significant This providers, over increasing builds. In

with wired seeing impact both expect we're of to beginning and fairly wireless mass more the While which soon, we product already, local deployment funding lines. will this start

unlicensed which the aims all the only in of block Wi-Fi for standardization but Wi-Fi spectrum will the Wi-Fi add features XX the were gigahertz XE, frequencies, new months networks. around to world a meaningfully the Finally, X Wi-Fi capability many gigahertz of X, recent band use change of X countries X. the in the launched of after has

increase to will turn like of higher and meet capacity speed. channels needs All Alex? the predictable, call serve higher in systems positioned enterprise problems, quick demand and bandwidth And is prepares and this well to that combined, it and wider Alex. connectivity for see this that for as now, a the more solves CommScope years the the this world. to home around future will driving interference availability bandwidths needs expect and the We over increase adoption of band I'd to come. is to

Thanks, and Morgan, everyone. good morning,

all changes referenced unless sequential a As be otherwise discussion on my during reminder, noted. basis will a

press You can and find our and in XX-Q. comparisons earnings year-over-year disclosures presentation, release

were results. quarter $X.XX a driven turn million was quarter for expectations. of of sales in was ahead Adjusted Orders increased license of Net slide segment, billion X.XX. let's Broadband order and our our and X%, adjusted by which we with software quarter. review in with book-to-bill and our with to so, Profitability the Networks XX% that, that X occur $XX performance And EPS EBITDA of from better-than-expected XX% third benefited of line $X.XX respectively. increased fourth $X.XX which our $XXX of million the expectations, primarily expected to CMTS billion

expense we addition, In efficient control cost focused remain establishing on and structure. more

the we our was generated expectations also operating of year-to-date. reported flow $XXX about For expectations. million, $XXX adjusted cash million million quarter, also than Adjusted below $XXX free and expenses above better we've

XX%, the Cable of strong favorable by regions, Broadband both Cable net the increased move slide quarter bandwidth demand volume both sales Beginning the as Cloud. to demand given million and and of continue as product America. increased Networks, very Sales from Network Turning led higher in as improved highlights. home. all remained primarily segment the XX% X, $XXX operator capacity, EBITDA by & I'll & with to geographic line $XXX Adjusted maintain Connectivity Network driven increased in well customers at mix million to perspective. across North and our the

Act In addition, Fund. upgrades fiber broadband the rural funding strong from cable continue and and US connectivity CARES remained orders support America Connect the as with

strategy. connectivity refocusing cable Looking demand response, strong prioritizing the to RDOF meet continued X as and needs. to with beyond, cable ahead connectivity prudent on to fiber and these we a core fiber we're incremental capacity growth expand expect In spend key Tier XXXX deployment investments fiber customer and driving and

Networks. focused Outdoor we While Wireless, on our extends the C-band Broadband across to and impact include portfolio

$XX quarter, associated we we over of with XXXX. the million expect continue conversion orders throughout to and During benefits third these and C-band received reclamation,

RUCKUS across tight business X%, Venue other by continued expense perspective, our by of in market million and in Campus the growth XX environment. end led North China. a during EBITDA Adjusted pronounced slide unit uncertain of net $XX to grew America higher most growth with BUs. segment, and was and led $XXX Europe, sales modest Turning and grew million XX%, control growth volumes From an

quick-turn, positioning momentum another strengthens cloud fiber high-density with quarter leveraging heavy to counts We due hyperscale key continue customize to dynamics. build and to market work-from-home for usage record We're as our our increases capabilities Wi-Fi benefited outdoor and cloud while continues and need. strong increasing build, as Wi-Fi from technological deployment global expertise, our simultaneous leveraging and connectivity subscriptions size an scale. to RUCKUS in growth X essential be

as we to also ecosystem RUCKUS Google Wi-Fi that During user helping the announced simply quarter, joined customers. the for our a partner, Orion secure experience ensure roaming a and

driven growth mix, perspective, XX to macro XX%, From sales net partially America, Moving the expense both continue control. partially by we declined metro North the Europe and a unfavorable geographic and Latin of weakness with Middle builds. geographic and $XXX Central layer. active slide on perspective, and by in lower network operators and by declined primarily in several East by their offset XX%, of in Outdoor Wireless, offset From million and primarily in million Adjusted unit volumes investments business Africa, in a declined America. XG EBITDA are driven sales discussions $XX operating

geopolitical may gain solutions. dynamics with are well-positioned market Additionally, and present opportunity portfolio share our we best-in-class to

net sales carrier Tier X were year, plans this we first-half-weighted expected. Turning to most as with capital – carrier capital North plans America, soft,

ramping T-Mobile balance which year. However, spend this was track partially for weakness offset by the of the on remains

XXXX, in network to investments the accelerating forward of XXXX. at As we're we close XG edge looking the

earlier, C-band industry. begin exciting for month mentioned time next in the an US the As auctions market Morgan and

technologies by and channel. and value implement become the From than declined carriers, opportunity an for particularly partially CommScope. landscape and on to continue Networks broadband brand mobility the Declines up in available perspective, of creates Europe and shareholder North we for this with sales million in next strong will shape better business driven Central segment slightly significant the in retail Net North and America. $XXX the slide our America a highlights quarter. expectations gateways, design by for drive new XX. As decade XX%, that American offset primarily unit Latin frequency our see Home to Finishing growth the were growth for

more by than million of declined partially cost XX% $XX in actions taken However, driven volumes, Adjusted offset continued was EBITDA year business the by lower this challenging by declines the in the video. offset right-size earlier given the to environment.

generate XX, significant cash. Turning our to slide to continues business proven and model unique

$XXX operations delivered over is we we front, focus cash note, XX of million control. adjusted flow team During from our the from cash flow free benefit impressive are cash working respectively. cash $XXX execution of From Of reduced, drive last to profitability again, days continue million, further expectations. $XXX million driving and for the our strong collections free and flow performance of the from see Once as and months, operations a quarter, the $XXX generated the capital both flow and our free the generation million, above cash on adjusted sales testament operating a to expense outstanding the on great working was perspective, quarter. capital we to

continue in ahead, driving in Looking working see particularly we opportunities inventory to optimization. capital,

liquidity for capital XX overview slide and to of structure. Turning our an

and announced long-term the until the runway proactive took XXXX by and third actions to quarter, our derisk maturities XXXX. than This As maturities in no close debt more notes earnings since action, repayments significant we reinforced the balance acquisition, $XXX early of long our million extending the XXXX. along in with to refinancing last ARRIS with out call, the sheet our during XXXX

billion. and sheet total Our overall cash over liquidity the ended million quarter of $XXX and remains we with the balance $X.X over strong on the liquidity in

notes October the quarter, the XX, In million XXXX same the we additional an our notes. XXXX. due $XXX of end $XXX we addition, third Subsequent August million on redeemed redeemed to unsecured XX, X% on of of

While times leverage remain quarter, consistent. slightly to increased our the priorities X.X during

strategic to that, balance are call our over sheet. and I'd in With market We focused the like manage more long-term strategy assessing to deleveraging on and turn guidance Bud to the Bud? approach opportunities detail. to discuss

good everyone. Thanks, morning, Alex, and

industry the the up market the to call the to From fourth don't for the want see open changes we briefly our full I meaningful we Before outlook from to quarter and quarter and a year. Q&A, third on any touch quarter. perspective,

it said, well would of highest expected. than we depths not Chuck's focus we occurred are an uncertainty Additionally, I'm required quarter. license sure guidance. with software to the all economic the significant the and our as on sale, all as time on noted that that that we for large quarter updated did to have company you the Chuck's use providing earlier with been the But limited which been board on best would and the have review the not given believe him to fourth time update Accordingly, approve fourth see,

and all expect address more our will guidance ahead broadly, policy with we financial reevaluate Looking for in we and detail to greater next year. that policy providing you

some arrival manage and Chuck's a a the way board look term. add a business at context, opportunity we further as the views much-needed me for in reset the Let in long

right are is shift management assessing working his We its is his complete, and strengths, its and to The the drive necessary and you've that board the on plan But board has is confident on to plan. challenges right increase Chuck the the getting the weaknesses, Chuck board state will credible its Toward Chuck share time last price unacceptable. on and over to going an that financial company leader years with laser to significantly price focus end, the this the is its the opportunities. been we on right all good together focused assessment team, and track to process. the Once focused back now. performance heard the a build obvious, the of building committed giving CommScope's that on learn As assess stuff two aggressive share lot are and to value. business to a there's morning, at performance business, shareholder

Chuck on the expect We to you In up to quarter present plan I'll in date it next I year. February with progressing this team will with over that, year. Chuck third regularly and you outlook for Thank that work how and And earnings is our this all calls turn Q&A. will keep you. operator his in resulting management meantime, the and of and next to scheduled the May

from from comes Your Jeff first Wolfe Research. question Kvaal

is line Your open.

that this awfully review. Thank question do this right time. a as essentially And may will you like as strategic to for taking three quarters a But long very if That seems you much. wondering be and is I'm caught Chuck. Bud much for Yes. be Alex an that I

XXX-day might it's you I'm may we administration? of just that. teams the a talk us talk if that then, a So, grace opposed been off to think or I items what whatever. could now I'm XXX-day the through could And typically, the process long table that as time, period wondering the leadership you were under given on mean, wondering if table through the under have thought of period bit behind previous that new be back grace

I'll to giving think it So, I'll more a take, committed outcomes him to I in He's and he first knows this can the needs further then it Chuck as will before he let I'll is and words. to board said that. Chuck and over comments, time how foremost, a And really fully few to build on my what start business and that we But say be. assess comment plan. range long of done the the turn

or is on I or table the think the the there's going the what's off off, off nothing of that's terms table, under table coming say or table. In I'll

to want anything be comprehensive to not and review any now. We thinking. say going And expect on Chuck? put that, we constraints we're think this Chuck's I beyond right to don't

what now, really the we I loop Jeff. understand different it's it, that, about And company. inside business take step trying billion value this need XX units I right? think by may the to it's do, as But a step, and down look, you where to all and and just think getting we have Right when $X.X understand that. thing Bud business to going Yeah, and as doing to I'm an do is And this go, we need step back you to with business. we as think really and about want to change thinking we're to share and to they're soon can, then do function what prioritize what in make to they what said,

said, Bud it as I've we're So, sooner, We done step-by-step just quarter. It's before. now process. the saying right but third finish a may

Chuck say, not hands next said, The other what urgency. things I plan. as more build that with it's comprehensive all to certain thing that would more the will to of things, just we become building is we're Jeff, context discover the uncover going though days. on Chuck when our be we'll immediate sitting priorities act I'm for on in XXX a And those

Okay.

do to template you intermediate communicate to inflections, so, make or other. how one trajectory like you sure miss between would now the all and for way And then? we have Just through the don't term a either that

Yeah.

build that take to maybe will on I'll think, Bud it. I So, want and

and to guidance said, there as see at some So in or provide what the we I but the is we and our important I in comprehensive auction until can into said have the I that tailwinds you what is also and conditions Chuck's which plan we in undertaking we QX. this think Bud as of nice whether mentioned, think feel a can we QX Morgan cloud changes like C-band not space. listen and RUCKUS don't from described, you market hyperscale or And market competitors customers, you to number of – XXXX, saw underscore, in earnings think growth and can some the think things, other are to that get release I look

of strongest be to is lot patterns So, get obviously, you outlook is few just I quarters. QX the we on have like. face. think And typically seasonally help quarters seasonally normal a overlook to tend that weaker. QX next weaker. seasonality an look is don't then, typically QX what And QX ought our to then, and that the we tailwinds going

all. that I if I don't So, hope And some know, that least on you to at gives you'd direction. build at like Bud,

No team that you we for want change. to now. comfortable like want Chuck we're pennies just (XX:XX:XX) we cut right environment to or or Chuck like don't operating – going working his to what But Chuck I step function on to. the Look, focused We talking kind in. about want, would quarter we're head completely to be it, term, just that the yes, and toward. down used That's as something all

Okay.

We will sharpen our you, pencils. everyone. Thank

Jeff. Thanks,

Your next from James. question Simon comes Raymond from Leopold

for timing, trajectory Hi, in a guys. Chiu expecting Victor opportunity of you the the us fairly given around what Could maybe help This is and you're forward? you to from opportunity opportunity seem the quantify Simon be Leopold. this size RDOF for the that material guys, and of you contributions emphasizing going this as

to time. then Morgan Yeah. how take Well, let over deploy me we and will talk this of standpoint, expect about sort go ahead and that from quantitative a

it's prepared Morgan his $XX I So, billion about think, mentioned in opportunity. remarks, a

lot it's of money into So, be the a to projected that's system. going

either. go competitors, That Now, go to will to obviously, products and going of that's go to to to all it's us. not not going our number all directly a

Morgan our a of our demand before just Network on strong but think happens. be see Also, making a will demand. Cable have maybe in we slice we'll it mentioned, this & even product to we meaningful. facilities And as of deliver mentioned number RDOF are very quarter or capacity spending did So, that, line, this to I investments I expand in Connectivity

beyond. XXXX some expect about can Morgan, how to is provide clear tailwind give it this going to it's you and we into us a more details So, But that to deploy.

Alex. Absolutely,

The all cover. It opportunity that in that really actually a So, access, it's out is a is on sorts of next the it is large in depends sending going over not government fixed-line to money the will way users this decade. number be of going just you're access.

geographies pieces various coverage. of different will different different various various and require so, And populations

it So, of customers lines all area. impact product CommScope's various will virtually as our in this compete

of can't equipment equipment and is don't go portion similar will the the system, we such builds of go a significant but for it why of build, a built, But portion a go opportunity $XX and of types company. it a consider is the to, say, that go into we the some injects money make. government I billion that into will FirstNet So, it we enables will types and of specifically, that quantify the installation to significant which a then into lot into this significant wouldn't that ordinarily make, be out

trajectory in expect that come at to or see a uptick to (XX:XX:XX)? more you some Do at going we it gradual sudden pace a of does point? how the ramp are Or

It's that right the funds. on ramp I now Sure. And to hard trying is based say that will these how vary capture it will to customer the work. believe

So, that I here time. is model yet take does ramps. a Clearly, says it don't this have how

not installed So, matter And a be takes normal because equipment it happens. on with to no needs step things that time the the to go what and and be huge going it's function this. permitted, all

So, and gated it should a would take by then, up I ramp to bit say, probably installations.

means that it state up has ramp of and more environment. So, that time steady a then some

you. Thank Great. Okay.

most heard. aggressive typer Vic, you're ever I've the

Just to keep up trying Thanks. guys. with you

Suisse. comes question Sami line Badri the from of next Your from Credit

very – trends. And Thank is - is Chuck, what My you. LLC open. technological of line in I question first hoping Securities you're some for the Badri secular and Hi. Credit was middle are Sami (USA) Chuck. Suisse Your telecom large

You have Wi-Fi X, C-band.

really year from these Just but from the focus you of over perspective. hoping just what place kind we a have could decisioning perspective like XG You treading without trends for understand was a to have as as areas us? well, or could, build-outs rank or criteria taking process thought two? next the should of cabling expect hyperscale you "guidance I you and large projection", if opportunities on

(XX:XX:XX) on equivocal are priorities it over say that I then all for hand of to answer them would Morgan, of kind but be us. I'll and

really time rank how haven't We figure them had all very important. or to enough they're out very, but to one, three, two,

hand to add So, any if see I'll it color over Morgan to it. well, got can he and he's

Sure. Yeah.

why lifeblood So, not competition build to, the why I out or impediment – the people has of spectrum reason the been can the the and think the but say, competition. to you – been has industry, reason people impediment historically, wireless

great One for And that whole deal me T-Mobile, the as already on auction is of to C-band the be and, the is trends, one twofold. importance a quickly, promise spectrum. rank a the industry to one to important done of had deliver has and therefore, people these I if most so, it's build things And us. XG, mid-band has and because out of will good needs that competitor, networks fairly for

most second is the The opportunity in competition the as in deliver between enough to that fixed-line the and the for well wireless spectrum mobile. infrastructure able leaves providers dynamic, type providers I build. of an leads that is that as type to real amount this mid-band home that always to be the critical competition be And reason broadband to consider of to additional to of why it

So if I number that's my had to one. rank it, probably

important. are trends two other The very

you government Are these were been these sort in marketplace Suisse Got wireless RDOF up help. more major a you critical doing like indoor these, intellectual Additional maybe of years? some of are out lumpy a And to of enterprise (USA) expect Right. and could Thank that more of kind spectrum software talk infrastructure, about, couple of they? then you to five come cover sales of virtualized what are how for frame follow providers when we to we it. economically again about where we are new property, against providers without indoor have for companies with executing - as to CommScope's is times their these Credit deals Badri lumpy be Could these and both big of the you, the outdoor thinking wouldn't think where a if One guys the software the And give you. sales? give next like just going opens both how funding back XX%, us and your Morgan, cable us for XX%? viable build should to reference over is up it and Are like about home. you Securities percentage they try big because they the many deals? Sami telecommunications LLC

Sure.

So, unusual is or lumpiness deals the I in the hasn't of the don't think happened anything that past. anything that

future architecture, capacity the based that centralized the on deals actually on that today, to exists these think not are network. architecture, I architecture the adding current the

future future, build for as to the will next opportunity the foreseeable over there if So both the are how migrating and people software at for we that look we decade, be sales, out. hardware

this the terms that hardware various particular already their business and based that and the software adding augmented. is needs, on they've of capacity augmentation, by determined to In really interest in their ability the do

we how of of deals just to these continue many Securities asking Credit done be period without will roadmap that past. on And then, sort Badri what time, in give as say would you for wrap question I the it. don't of Sami flow. a has my you. available, I can't cash be them any large I to Thank of (USA) how it expect it Alex many up So, that LLC can Q&A over a have - Got Suisse

gave aren't guys were and operating consensus than of flow? does trajectory guidance. XXXX-XXXX, I look you kind of just give today for framework this cash the we you gave to modeling when cash and But then if what Alex, trying guys us anything flow think So, appreciate you free guys about us different to in last cash XQ for prior

Yeah. I'll to a few work markers you give with.

generated, cash terms quarter. we year-to-date, million in that the be of $XXX I to seasonality free the generation. of think, $XXX cash of tends north indicate strongest north half this fourth quarter, second our Typical So, particularly million and would of the year, adjusted

but But and that of balance biggest EBITDA And pull XXXX. operational leverage off the activity a cash were and so, meaningful see did the just growth growth. a obviously, then both reasons of largely variable is (USA) Badri transition sheet next Chuck control Got bring will to getting But able be the cost and We normal every because be cash. We same discipline continue again, the Securities very we is up it under much. LLC take Suisse about board excited demonstrate rock we'll the Credit - fresh demonstrated and the cash. to year he level. I of you to new right. this whole EBITDA very from going it's a that All it. one lot to year. we've about we're sort a leadership generate that generate And discipline. look now Thank don't will changing lot into extremely on to integration through Sami efficiently, continue of set of to before, and eyes

from comes Evercore. question of Daryanani Amit the next Your from line

Your line is open.

thanks would my stock start I I Bud, I look if morning you maybe as Good two but to have at I could on, with question. for appreciate touch or taking well, what just performance, three think you guess two and has the and years, you board what stock said the the the couple the has really you reasons the for or stock performance think are two or has done unacceptable last of it done for do the been why years? when board

I think performance reason and what that's the single is talking we're about financial addressing.

to growth is And is market today I'm picking Could And touch right. guess, that adjusting you (XX:XX:XX) has growth is, from this growth The CapEx shift for on side hyperscale within the revenue broadly about well the guess, hyperscale folks how more talked I hyperscale really the or then. more figure big maybe then, side. and strength do All notable, Campus XX% sustainable on think plus importantly, I just share? you I'll on you been I up because, out coming trying is or you and the it think Venue stream this how company? hyperscale

Yeah.

both. it's So,

it, digits So, double quarters. last hyperscale the or four That's for call millions. is, now growing probably low-triple-digit five right been

and the didn't talk number heard a probably a lot, the capabilities as based XX a to us months needs, The manufacturing back capabilities. of to access we is we to of built have team, a capability, chain unique really like or built the huge plus really to new one So then, customize And be these quick-turn product serve the the management through we line of the going roll company. both wanted fundamentally to so have they one those And Through if footprint, engines the set you've clock we work this on team acquisition, capabilities. growth about operational lot way and of about the quite that, of Exchange hard big the so, players just be the supply didn't frankly, things served. ability Cable the global we for the we built of discipline accounts.

side. long. hyperscale it's business, And have So, going bigger now in our see Venue reason the these we it we're on inside not currently, is copper but plant is, for because right inside dealing headwinds be and you copper to the don't the way that that Campus than segment plant

you'll and Venue very will also at I in that in growth. overtake hyperscale, to RUCKUS think and see some addition strong very, segment we and declines point, to see in begin that growth secular copper, Campus continue contributing grow that sub-BU to to the the

a would last strategic we're cloud yes we've as being momentum of of some segment you strongly lot capability of So, question, which that or feel out. we're different really have We And share excited applications see here. of growth, the yes. market. about side, then, is The part And a by the that and point Software-as-a-Service the we that But don't. scale and, rewarded with that classify is important all all strategic I your last it level important we built a got pretty say, CapEx? And of is on smaller it that will cloud obviously players customers. very very for also the the are our is of being the

So, overall, progress. some exciting pretty

see segmented, I of very believe just could most add this you and segmented, type an I a and want time and with a me to again more team about Amit, lot group. to to I would And What it. that's that's go, you focus. where to was it excited exciting that, this dedicated we what stuff. I they They about some going application, it, that the – found good tell what to said was after spent morning. we're And talk is that to went have and of

Appreciate you. all Thank insights. Perfect. the

Your next George question line Jefferies. comes of Notter from from the

Your open. line is

from looks have with Hi, of rural us love chance? Can guys. business any to an number start I'd you you like the operators, what question. your if by mix very that much. Thanks just RDOF maybe tell off

Yeah.

I don't – a ahead, have Alex. mix go

color. We was details. specific you'll customer I say obviously to going don't additional just provide disclose

add in from these customers. cases, know have do many of we X disclosures Tier to. you actively some color Tier of Tier X, even of markets tend large But XX% early had going we X up, the make out Chuck number in smaller long times But our a we as Morgan days, operators in to will cater to very pointed as You the several has well. customers were tail very a that

go. companies. product everybody basically competing space, wireless the the into to our both It's it's operators, it's That's where it's impacts lines. it of so most was cable And traditional the I WISPs, going

it. Got

program of Okay. the numbers when RDOF, RDOF $XX CAF of the program. And you million the sort you prior then are replacing, subsidy talk you that mentioned is netting number, out the

a smaller. number the billion of not But the was No, old what in. the bring net was a significantly to years program program. new is It's old expected $XX of over is program the and

goes versus We so to also are how much like goes how not us and installation much things forth. quantifying to

We haven't detail. that got to

it. Got

opportunities your Could just for you balance you And to by in the sheet. meant quick commentary, strategic what about one manage you mentioned that. talk then Bud, market Bud. one Okay.

I'm I remember to don't think remarks. my anything about that. said trying I

commentary. there and Bud, maybe curious at. I'm know I'm it looking guys that Chuck, I was put the into was in that kind why what about you sorry, but of are was just comment

and repeat to that. make it that we please just sure got you Can understood

Yeah. balance opportunities It's to now sheet". from my the notes, "strategic market manage

remarks. my were those Oh,

Sorry, wasn't it's I out of taken just so context, it's sure.

have and was of said is, the uncertainty maintain deleveraging sheet. sheet. continue balance basically And we on to I so our But the on the think board we the team commitment sheet in much why that focus to any balance the to deviation managing the on the balance market, relation talking given is which directed financial we're maximum management what not is cash what in the has right level now, flexibility, deleveraging. about cash from the

I that does So, clarify that – think it?

Yeah. enough. Fair

very Thanks much, guys. Okay.

question Stanley. Marshall Your Meta line the of from comes Morgan from next

open. is line Your

Thanks. Great.

changes not of Tier to you what You in remainder for to seeing. in (XX:XX:XX). you the Tier expected that of the that front-half-loaded clarify and Xs I there from what noted incremental that the your Wireless expecting you're no be Xs were wanted kind of had business Outdoor were kind just kind quarter year would of was

expect really with of Wireless was a say We've of our acquisitions, started really news of the in And operators' spending was good and to with line little the the that I'd along completion one that bit they've it communicating And front-end-loaded. the begun spending in we QX going expectations. Outdoor again. and got be segment to QX year been ramp that all the ramp to absolutely No, in we beyond.

this I was some news. with internally had that that positive is But good in expectations think well. the directly So, and as externally communicate at we line tried certainly we, least, to

of within I maybe growing noted to customer kind that a wanted growing Got within on the that specific is customers? deployments you ONECELL, growing footprint of Just then, is that. it is or just certain count or customer customers? sense, just with it. kind growing get is success deployments growing And just

bit So, it's a little both. of

think which North we getting the X our American market, more a on We're extremely at qualified that operators. now Tier success think, operator, the exciting. traction qualifications, we're So, is major – in we at working generate North which additional gaining additional American will we're

better intelligent increasingly looking be people a it's and space, as deployments have a to come with has. providing the enterprise else XG. relevant And aware the into it's Europe serve get ONECELL, we're Meta, creates And solution. indoor we about. just in is to up how nobody wireless a a RUCKUS what an the are product propagation, you're spectrum solution of and seeing at quite platform for better intelligent that wireless excited We in that with enterprise as – honestly, line just do here, us conjunction criticality increasingly unlicensed you really the option, going the that, space they're of also indoor But is really, becoming

Thanks. Great.

Jim Suva next Your the comes from line Investment. question Citigroup of from

Your line is open.

March things and for ago need the you are you or expectations, to framework, your, (XX:XX:XX) though, comments, months mentioned I said that than to and the for And is lot December more take much. to compared of QX my other hey, then, should but your softer. very in and progressing you And a changed software gave review QX where necessarily, that, you months definitely also a you think you well QX, strategic understand had sequentially when seasonality from from seasonality. the three a But do in memory hasn't remember, Thank outlook quarter necessary not time. I said are typically be pull the quarter QX. winter if today up correct, remember

months calibrated seem the much software what today it just your is remarks correctly strength kind you to up consensus ago it calibrate from and expectations, said I'm So, to of three and trying like from of consensus on kind we the because so the just to pencils to of re-sharpen pull it, work-from-home be for QX appreciated. is in need or our QX, seasonal, would some better QX framework

Yeah.

going to guidance QX. to is try for to providing not bait unintentionally, And we so, why aren't provide guidance the I'm reason because there a take

deployments of did You will mention down. We strong a that downturn gets slow have and consider. Bud which bit pull think note in an to that seasonal little I important in, QX mention extremely license QX weather quarter. as and the is do crew was the generally colder I

issues sort to in. So, of factor those are

I that. got accelerating spending about think also good T-Mo. And You've feel we at

the in segment. activity node high-split and mid-split broadband continued got You

mentioned and we conditions see takes. thing QX So, I material the QX. you market underscore that have the in a between really is don't what think of puts and But number change important Bud to

to external nothing philosophy the guidance. around or really, the company to internal the change in market So, to there's that led

are or still bit declines products, declines? or stable, are of normal, the getting it be or broadband the average or you. little And and about much pricing better other given useful. pricing they a about is, talk kind such, COVID, in That's can and cycles work-from-home where demands pricing, gotten times price question there your Thank Okay. environment, has then, than the and selling better, and been you normal much And in less network gotten whether maybe customers my has worse. on follow-up has the necessitating

mean, a customers. very question I'll large is is that market very the way with operate competitive answer I something Yeah. attention the And we in always we price pay to.

introducing As for legacy technologies as price with supply in different new X% chain and of operations. we've generally, erosion better and plan our products offset about by functionalities the well as value said combination is ongoing just that we a previously, excellence

one is that's as been aren't the margins But introductions you micro steps pricing I've macro the described the operational the as would excellence more because that's just seeing with say, now environment able stability business. at a seen macro why well erosion. say, we've than you long see we're take to that to more of do level. So, technology we kind as of fundamentally anything I different through I that trend new level, price I what reasons offset natural from At a as the the would

Thank greatly you so for It's much the detail. appreciated.

question. your for Thanks

question Samik from Chatterjee of last Your the from line comes JPMorgan.

line open. Your is

here. in guys. Hey, squeezing Thanks for me

questions. of Just couple

appear but positive you can guide, kind we for thinking trying how of of trend how as Wireless of Alex, the of think And the your think metro that into you think to mix? think should kind environment margins macro Wireless, And XQ. you don't particularly just you for should kind that about I Outdoor impacting you're drivers XXXX, on ask the of segment there? up following of given we kind that how on to just sales, on – between well an and want just Outdoor about do me if thoughts to into Firstly, give business

Sure. Morgan. hand I'll I'll and then start it over to

couple a just developing that of things front-end-loading the me operators we've seen. of plans the of process in spending. are detail let So, mentioned capital the their of record. now XXXX right The We

space some been of from There the seen in beyond. peers for is metro layer COVID around certainly a as of XXXX and there delays number lot what portends the impacting a that that our excitement permitting at You've timeliness. competitors and have XG and

stage seen currently in would XG is I where an we've and what nature, will software and a still play gets of the into XG we're at antenna early XXXX more evolve very So, play spectrum a a say, of that and more more wave of transitory largely is introduced. as this radio lot in new of

real comments the then level So, really spectrum capital market, the where competition important, to this what also and you that? into Morgan's first from will introduction the Morgan, And T-Mo acceleration to become C-band is because XG a around becomes really of create which networks. out important the spending auction of is of add this the build would

Yeah.

competitors What said T-Mobile to out you has been this it as is additional So, Alex. well, spectrum, whatever their very pressure available. places spectrum started build they've to doing utilize on

one competitors anybody but it first for to they but and not late of be the C-band their competitors So, on. are the C-band money, from spent a available good all licenses. themselves expected spectrum, is of a licenses building dollars will of does the the of And of limit that deal those on turning next couple it expected sites, year, not CBRS and billion may their bid that

as the think other toward lose after build going compete in matter, they're that in or, everybody so as the to industrial So, segment to gain they home. I to new possible that fact, having out in that these or optimism is IoT for that and, do or networks applications there subscribers not quickly segments

connectivity wireless, it. access and going to is that of fixed to that fixed be question understand into technology there fibers If this maybe is a more business, follow-up of is part of connectivity kind I Got that the any would with kind that and to wireless that? on opportunity with to certain choice to be play maybe have today a your I – Okay. from get able any opportunity done. cater portfolio front? like you Morgan. and is you fiber outside of where would on But RDOF, And can just falls

Yes.

build fiber think trifecta. fiber be be for networks build There'll new competition. Tower these to I will predominantly you're for predominantly outs satellite areas, in fiber. the as coax Fiber some expansion to the Fiber There Perhaps, So, areas. new some the absolutely hybrid Home but as and correct. well

may a the in for any For this. that variety or fixed be of we used have wireless of satellite, products

wireless, likely look If to traditional a you system. lot fixed consider a it's cellular like

everything game goes for the but So, fair on radio, tower, is the that us.

opportunity a have good think rebroadcast just there. is home. the If so, money going not there's for a And satellite industry matures, This to there's of as satellite, the as other on I it's I well satellite, be to to cellular will points access homes side for and other and for other ecosystems, systems. the equipments the of cities, like so Wi-Fi that lot towns say, would enable

service technologies So, have to I because why help competition, this each exciting we'll this of us, able against think is they these all other. customers you all compete it's our so And converging. when it's to be as type

Got it. Great. you. Thank

Thanks for the question.

Presenters, our continue. will That please be last question.

look that's we're appreciate to think last if following our forward the question. really everybody complete up. taking I I we time. So, And

So, Kevin be obviously, for Powers And, also ourselves need make will myself, will available Chuck, questions. Bud available, be. if

support. And safe hope your everybody So, I there. for out stays thanks

your day. you wonderful conference. participation and for today's this and Ladies a gentlemen, concludes have Thank

all may disconnect. You