Bloom Energy (BE) 29 Oct 202020 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by and welcome to the Bloom Energy Third Quarter 2020 Earnings Call. At this time, all participants’ lines are in a listen-only mode. After the speakers presentation there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today Mr. Finance Relations. of VP Mesler, and Investor Mark Thank you. go sir. ahead Please

no our could actual discuss XX-Q, ecosystem any liquidity, outlook. XX-K Forms statements filed today's applications, statements. position, today results, and the To financial those Good related will Thank quarter appreciate our we call. of COVID-XX letter call, the and in afternoon server reports contained those for SEC, to that subject SEC XXXX you we with financial periodically risk supporting have our operator. including forward-looking forward-looking with differ and discussing have XXXX recent Investor most this applications, furnished we joining conference earnings in third will specifically factors, cause our that We uncertainties in supplemental company's website. information this forward-looking future to the risks reference to shareholder Energy’s Energy future documents financial the call statements market results posted that business company. detail all. regarding matters to Relations the The you it be made include about in assume the new QX revise the We new with conference These obligation materially call. are on Bloom from demand which to events us earnings the include important statements release supplement and identify the throughout on along and we These and timing statements of and pandemic performance on

in are not we measures addition our GAAP to, not QX During measures. non-GAAP substitute in Generally Principles with to a and this refer U.S. are accordance These and or Accounting and non-GAAP Accepted call XXXX for on shareholder company’s our financial in been Form and measures financial in letter, which financial prepared letter, and financial QX accordance website. included has performance and relations with GAAP XXXX the furnished prepared non-GAAP the A posted measures investor reconciliation to, between is shareholder in of on superior GAAP. X-K

R. Financial review the Joining Executive Chief like of this and today will me we into call take the would Principal Greg K.R. apologize audio Officer. Bloom's that I Officer; are questions. then turn Co-Founder now advance to any dialed operating occur. Chief I for K.R. Greg note the are and Sridhar, also remotely, we and financial call Cameron, so we will on and all that over in may and the quarter, highlights call will issues K. to

Good day across long-term as in upon XX, to XXXX It drive and continue life. I time, March third fourth that first our results, third on we for thank quarter place that to our progress business our progress the made have our us. quarter Area's the industry to of day future. and how Bay in unfolding we would key has joining the Energy and March, leadership. operational discipline the fundamental at that and was substantial bring affect pillars reminded we are Since earnings quarter and was you situation impossible great our know shelter to announced Reflecting agility Bloom innovation made year-end order.

will of into our time. over have we team, and We significantly balance pursued believe our leaders have enhanced that added drive executive additional our initiatives predictability to more and number liquidity, sheet proven a business

of up we well hydrogen, something innovate, to or our values play area. to thank in outstanding to community, continue great ventilators innovation. grow we our hurricane leadership response motivated that intend Even or manufacturing the to me. to our to for nutshell, business March. our challenge. personally a in address collaboration stronger platform, the and resilient redeploying responded team an I’m in need am we culture, and resources I true employees, their I to turmoil, COVID, Bloom core confident how power to in proud our want role is immediate on it is hospital our as core that for announcements Importantly, In was was serving very met whether pop-up exceptionally rapid meaningful drive exceptional our in to and and a times Energy is remain Bloom making response serving to as important [these] team than of the today field including it in devastated our need community. of

is new markets. outlook our embarked to and have on we well, numerous performing initiatives are brighter. This year, large We enter

Now, share some you of with let highlights period. the this me of

financial health enhanced. is our greatly First,

maturities, debt, added is led allowing our us cash more reduced to balance who sheet. to effort, and service will expense, The our extended have provide invest shortly. We reduced successful the interest reduced details expansion. in Bloom’s Greg, debt prudently

in capacity. line and top We manufacturing and are investing and research growth our accelerating development

have strengthened of to parts attributes want country. the gas are more and platform. the disruptions investing in energy solution. Manufacturing, to protect power retail Entergy decentralized solutions on the increasingly bio be have a seeking QX. deployed, in are is have disruption] as Energy's future, always mission we opportunities Second, through Companies, decarbonization. ride stewards that action always-on our our and businesses achieve Bloom wanting the cost The forthcoming with critical are are In now to landscape, microgrid, more see have facilitators In severe change. industry. clear wildfires during new partnering responsible in of tools and of effective, partners, also with to energy addition increasingly, are core with to ravaged resilient, XXX disasters our security. valuing embracing that and time to Businesses have and improve are natural the products. of allowed climate technology a Entergy, to markets face many of grown we in storms, quarter, the providing the technology relationships prolonged take acceleration frequent providing Power third hydrogen [power customers recognize of evidence Busier utility XXX support warehousing, and we and their hurricane, healthcare, to seeking, also increasingly services in Energy like energy we sustainable Louisiana, businesses the and transformation encouraging increasingly to public creating be local environment Together weather. who microgrid the

capitalizing growth Third, accelerate roadmap, we are by will our emerging opportunity. which market advancing technology our on

widespread a based and hydrogen growth power Our generation. cost of bio powering maritime include sustainably carbon enabling developing industry, effective cell hydrogen electrolyzer, and the fuel capture adoption gas solution, implementing initiatives

dealing in during beyond extends Investor a into with our elongating the in factory process. climate our skid Day hook concrete, progress wiring group. in deploy installation essentially the shipped products innovation our In Bloom We construction area pre-assembled ready for eliminated, forthcoming December of on predictability skid are Fourth, system excited installation where change. Delaware. new a our of out Recently, to systems, a installation drop detail us the share first our our our An environment is it and pre-packaged and effort to the and deploying and team rapid is a system installation greater of we our be Energy's part ease to the in construction to upon exogenous improving broader process and product. eliminating impediments simplify our A creates encounters our skid in business. lot up, that example continuously the of allowing given of as world necessary our This pouring we are ready was our to

a to to and the simple of skid operations, is customers customer reduce volume. factory for of short-term to our portion make By integration will work We industry. skid from and have transferring we its will a environment, Bloom thereby The time installation us Energy included power significant the Bloom field geographically in a a a to control picture outsource a emergency presentation. is trained ease to field our of standardized install. more partners, also it manufacturing less It predictable in the integrated product easier basis. process enable contractors installing to Bloom time and location conditions run. unparalleled to the dedicated costs in offers procedures is a deliver our expectation enable enabling Fifth, field It performance final well over on or scale the products assembly will and team that up Bloom in both that in

installation Korea Our is X.XX week power a tower megawatt away anniversary. in from two-year its

the delivered down stand the our than then is XXX turbines XX.X%. a modules around required a factor installation Here power combined factor The are have system, about XX%, of one our have our fraction project Energy's XXX our EIA, the Department provided unrelated of have other wind field turbines gas capacity replacement megawatt of XX%, for unit. Not to capacity XX%. words, availability. maintenance the to Difficulty] in highlights. nameplate solar a capacity as only a According a period, the XX-hour Other XX/X, cycle a had factor of of of amount system customer power initiated panel to has [Technical XXX% servers, at of hours

that been relationships Moore, far EVP leadership me is less and to factor lifetime International installation what of new compares performance XX% Greg regional Bloom efficiency and The has power March this exceed The does best-in-class hired our than we availability XX.X%. Let contractual our will senior of delivering [fuel to is plant solar services a Korea. best, by in CFO; that announce Sharelynn base Shortly, as can customers. level availability. EVP and Energy commitments. CMO; will have focus availability, our products traditional a and and summary, its Development. be Government load its for repeat, capacity in Guardino, have the it which person am and between have trusted our XXX% cell]. to By I efficiency to we XX%, and company, grow attract never win-win on This us responsible XX% SK of Business the qualified leveraging South we’ve the especially continuously reliability of improved level Carl are servers and partners Cameron, years that Bloom and able delighted we call, Affairs the showing by performance our positions. innovating demonstrated exceptionally to In Policy. now talent with the pursuing Since market similar partnership over as been as to footprint, Sixth,

ability we pleased to made their has We forged and This have teams certainly challenges we progress ahead and management with formidable the our XXXX. been stronger. year a have lead. are that case, has overcome In tested in very

ever are out than in are level has at the company position a executing high better We coming a been in. and

Energy. We are our I believe Bloom been Greg. never better will a future for that, over time With turn to it and excited about has there

R. Thanks, K.

third deal As quarter. a we you great said, in accomplished the

a operating in management business to environment. Our execute complicated our and ability teams are demonstrating

improve our prior near As and debt. term my the was calls, simplify address discussed business, our company, liquidity, joined we in when our focus to I

During convertible entire of the financing green June notes have in of raised third part through a XXXX, the an debt of offering XX quarter, million balance the our holders retiring XXX successfully now [attractive the float]. promissory convertible We due XX% million. bond of rate in term]. shares new conversion are the we by at been traded [public converted The XXX and former these completed majority

debt the have the debt reduced debt, we have supplemental referenced, and available over outstanding outstanding Additionally, first that that prior highlights. notes our million. the or we've with debt provide XXXX, XXX few entire flexibility less improved have manufacturing These sheet, and that our and clear opportunity additional XX But will net improved that well-positioned be capital. which capital is attractive scale, those Today, financial our debt A million, XX forma reduced by real XX.X on continue our our we and to advance details pro Since have and return only the X. a to the our capital secured around structure, Mark further unrestricted service eliminated growth. leverages. we senior structure be In cash for capital capacity. debt to any actions, pursue million. called off balance deck balance balance the to pay cash slide maturities we our our recourse and want the roadmap technology invested improved and cash I to applications annualized clearly end due by investments million, an meaningful disciplined our XX post-retirement, XX% November we market on quarter, Bloom outstanding will balances, of demand, million With our for XXXX included recourse the develop information ensure of are of

Now, quarter the financial performance. let's third turn to

the we I Similar provided balance key in A financial some information sheet. we've quarter's this prior an context of of sales. with XXXX, large completed a your quarter, million in relevant. For reference versus want couple key that repowering in less results prior making supplemental P&L related and sales in and note the a repeat financials to XXXX provide of last is year items revenue financial a slides, benefited our release some summary include a deferred in comparisons comparisons. previously did not year item highlight also from our metrics to of XX.X additional to along summary results. around unusual and relating Also, this year XXXX. This to

utilities some flat timing, storm the for weeks delays transparency some significantly for revenue for with million, northeast, quarter a fourth deferral the re-establishing adjusting related and accepted adjusted quarter roughly in the to XXX from prior to where margin being first when being These prioritized gross business revenue On acceptances, the up benchmark up recognized metrics in the XX in non-GAAP quarter, So X.X% Reported in performance, item. XX.X%, power revenue two half. from the operating release, the is deferral. first reference revenue excluding impacted that of future as provide mostly rightly this are October. was service. for experienced When achieved for and activity installations third we reported XX.X%. the systems We XXX.X sites

profit, a of kilowatt, this primarily costs, revenue deferral up $X,XXX was prior driven mix Our install acceptances. lower very from quarter, per per economic kilowatt products strong by the profitable excluding quarter $XXX and unit product more and release at

at strong continue and through in we like the remains our partners skid look installations, highlighted. profit R. design, to On approach, margin K. simplify XX%. to Our adapt

We this are the committed to profitability component improving reducing operational complexity and in our of business.

$X.X million third in on basis recorded Our investments increase installed an to as base our we made in loss the non-GAAP output. service a into a fleet business accelerate additional quarter,

we make our number is focus the units increasing fleet business since XXXX. installation required performance XX% output, replacement of an to cell fuel targeted have achieving improved life and by reducing this management, Through Our and profitable our costs. support to reduced by

event, financial period, the the cost to During will continue per XX%. and time same the between service per unit ultimately replacement reduce we time by expand These resulting events improved cost results. improvements reduced our in

a adjusted op was future. million profitable by expanding income non-GAAP million expect in-line XX.X a quarter, XX.X the operating Reported the in operating with a XXX on EBITDA non-GAAP even adjusted margins We we're consolidated quarter million. deferral, this adjusted was to progress ended the our with was with to into and revenue We and million. was have revenue service non-GAAP journey pleased business Last These cash. growth XXXX base income the X.X we installed highlight were extremely XX.X EBITDA. profitability. positive EBITDA for more When with the in metrics adjusted positive pleased quarter, million In income.

long debt capital off down lead our million meet due relative partially both of investment over for usage. last This it we as XXX Our cash reductions our began items prior year November processes secure to facilities. capacity enhancements balance, to Senior will offset Secured costs, additional supply on we term manufacturing convertible XX the equipment manageable million, raise, is management. size an near and XX% to new need in pipeline, product Based by demand, in debt I excluding XXX decrease and pay when through upon the the the increase the the balance The the chain back. and the pay and service commercial such is and reflecting XX% continued Notes XXXX. quarter, million mentioned restricted cash from working

manufacturing double XX over to two to three million We next to the our XX years expect invest capacity. million to

be rollout While absorption, may roadmap. on short-term some to facilitate investment we technology pressure believe our Bloom cost to this put critical and this the of X.X

capital fund expect We in current where structure utilizing to these equipment our appropriate. investments financing real framework estate within

the we our As install fourth expected, server Bloom quarter. X.X site plan in customer the to in first

build we as production operationalize manufacturing will capacity. we XXXX, During our

will in shift X.X from XXXX. Bloom X.X Our Bloom to production primarily

XXXX, other COVID. seen completion with on from we risk chain aggressive of shift, on forward path pandemic manufacturing cost United based climate hurricanes supply in to the most to the potential challenge Like we the estimates our expect events, continues upon continue we reduction. our As States, the and weather in the businesses, suspended storms the in northeast coast, of fires we've capability, increased case, an the In driven and increase southeast. in In installations. west the

pandemic, our While stress the delays caused product the with these and understandable of further resiliency have events in benefits installations. the of our support they coupled

operations building. We have partner contract. reiterating We canceled simplify risks. the the are opportunity despite no relationships to environment, and are these reality we is that manage this adapting to believe customer our worth structuring macro an the to to It has we

to of continue have we product to demonstrates the partners strong Additionally, financing customer our in progress backlog. quality secure and and XXXX. are with several making This a our of pipeline importance the products

cadence comparable first. seeing being revenue in the XXXX than with as stronger and are half We second the profitability our

that I few events marine we in on revenue quarter to For Earlier margins quarter, of better third closing, in teaching] share I'd additional to [held we the on performance this the the slightly other the last future In reported a be income the expect a to When greater we like committed month, have Bloom I CFO, and with transparency we Energy. the provide solution in updates. operating quarter strong initiatives. will this year. of became and coupled fourth our similar discussed year, in fourth

on advancement plants. our well the will made being hold as with hydrogen our electrolyzer. one shipped the progress month, this on an November XX, energy Next on first server, discuss we quarter, as We've to event hydrogen

demonstrate the solid oxide technology. our commercialization During we will the plans, share the hydrogen of and roadmap, advantages technical discussion,

capture expect months. gas similar as in bio coming presentations the You carbon such on can and technologies

attend to presentation we will strategy, where very plan approach, commercialization our financial technology for product and framework XXXX discuss Investor first our please addition, in beyond. Day cost roadmap, In December, and

logistics the to questions. over share and that look open With to feedback that, weeks. forward details line for address to ensure in advance with the I and will you your We gather hope the questions. discussing our coming plans can up we operator,

from with first Stephen line Morgan of [Operator Stanley. Your Byrd question Instructions] comes the

afternoon, my taking for questions. good Him and thanks

Stephen. Hi

margin of the what think XXXX, to fourth I to Wanted you this of in we've I talk to similar quarter, just you quarter. were sure quarter want to the the I'm just – Greg, that messaging that expect outlook fourth similar just make to the there to but of to the margin you want similar sure sort terms kind understood mentioned of margins seen, fourth make average quarter, had quarter in fourth for revenue about year this I be the understanding

Yeah.

margins, So, think we've a made year, in we And think our this margins our better talk call, I quarter revenue the where mid-teens, well our than should really, on the positive tremendous I income of over when deferral, progress reported the a little in amount about first as when be strip-out as we're year you a operating are, XX. about revenue were range, XX mid-XX, the ago. on fourth we we But on in EBITDA. when were we and

better my is you look that I should bit profitability to we expectation as and will little our the forward So, a report quarter, revenue year-over-year, be metrics.

to quarter. third they as operating what very in other as metrics, basis an margin, similar in So, were the the well

profitability. We are maintaining that made on focused very we've on improvements the

additional anything sort that, are installations. you when baking mentioned accepted weeks degree for you delays October, think of fourth delays, storms, think the performance talked or on conservatism in of you of first XX when couple that? performance the – risk the like the for about some in quarter, some of I potential the about think about also you you And And of Understood. the

look Yeah, right. when we

us timing So, fourth have as do but gets on only history's those a day. as offs, the holidays those because on normal XX point, of you've interesting about you you quarter, pressure to there reporting basis the more the alone your told it. either got not the put that well. And fallen could cut from acceptances the have could think side It

that I we anything that thought quarter necessarily plan as that could into if very the R. we operating it, or quarter. So, the the quarter seeing built as fourth K. we on make data and about focused wasn't get on we weren't, December sure were had the for [within it the a earlier role],

tried had say the and to learning’s quarter we've the endgame think we So, the from business? we about about working real I’d know to, take that as of think roll in we third the out from the with of script the them I about quarter. around take through fourth think some mentioned is volatility right, how process, here our you partners. we as

installations, I'm that the find ones that ability the partners take think and to our hopeful think core that partners and we've we to OEMs that of that, into about own around leverage competencies to volatility the a find their we our think it as and past and where like work have I do, process that simplify to talked move that as I through are. operations in equipment as continue ability our out lot the of do

Got you. here. me from Last one

Is appetite limiting usage? biggest for sort What Is would Just on what about growth it issues Is factors as natural as you biggest growth? around growth? installation? the the limiting you gas permitting? of you it the, factors it to are think know, characterize overall,

me let K. and start then I'll it over to R. hand Okay,

only really U.S. think in And I we within about K. South I have think, year a talked for out some the just shareholder had, tremendous as made how are repowering our broke business. Korea, when in we've the you So, much shareholder I not of our where R. out know our growth progress really growing within relationships, on our our letter, we which distribution year, on last letter, this it, U.S. the to show revenues adjust in well.

customers, also growth can internationally. additional also so the tell resiliency I the I U.S. from expand value over right, the as operating the their be pleased map will distributed]. process there we a from of – from current mechanisms, as only couldn't is U.S. markets is an not how our in where view, well [they larger just, within and the the So, product. I the our but relationship, with continue standpoint. long-term, think, operating think I I really they the to you within SK find expand think play its am alignment with to

As leader we and expand new look excited to very internationally our business international we'll who I'm development announce about.

in hope find partner value will is to Our markets can expand we find SK additional cost where to that similar our products.

So, I there's look at and the play been we’re And say there’s as opportunity well. to markets an some opportunity we’ve markets within in other in today.

And had installed to since has you numbers, Greg about Stephen, XX.X you megawatts. this our that, Greg at look say to add what here, to of in SK the talked know, partner Korea out year, if in Korea beginning just

Okay, that that's systems intermediate] [XXX installed. they’ve

to when partners. the we we a the so showing past, have in find us are then this and it. what seen is right do as would potentially And installation what to for And able while need leverage gating item you we

know, bottleneck can that You be overcome, right. significantly

super know, that as And be excited they we're for decarbonisation And resiliency, well like you with on us of are great the you that. are part so what for both partnerships emphasis find, planning that, given we about is hydrogen. putting to going do forward know, to opportunity a sure, that's especially as should

the are those opportunities. So

We across look it ability whether liabilities, out you our attributes place. today, flooding hurricanes, Resiliency the terms put to is important. are see that – the in together. available extremely just limitation, of to don't balancing right comes And becoming see the events, everything In know, to we we when our we sustainability, it's resiliency, best product we all is country, do right? of need wildfires, otherwise, that to

about future is the we to enthusiastic hope going look, So, for. be will what very

good. much. you very Very Thank

the question next from with Credit Weinstein comes Your line Michael of Suisse.

guys. Hi,

Michael. Hi

could the maybe you little and sequentially. costs some some more sold in are that? roughly be to goods talk like declining? driving bit think it's factors down know, direction XX% very drivers system a talk behind the with Seems you about I pretty the of across good you a total the installed that about, of Could

we very Yeah, pulled on were especially together, no, our the after were all economics we them quarter. unit when we second pleased

X,XXX third the XXX quarter second from in the So, in quarter.

If them. is favorable quarter you things apart start to couple the there's to happening the just that mix, that a are of profitability the were very able there. One we a within that and do pulling deals related within

that was without by reduction in that in time. cost that margin had the that was and pricing a that number significantly improved product Our at accelerated same

So, two lot profitability. those to added more things a

would projects get We I'd the also issues, were legacy we of quarter, We through we profitability excited very through. second came as had some that There get done, them, were installs them our work in but the didn't some older say valuable to that going to done. have completed they forward. we have

to loaded you a our this by at that that we about we're basis; loss installation, it I on a installation, fully a basis. quarter, guys an breakeven So, big a as reduction small change operating on well quarter. as quarter-over-quarter driven both give margin on on the look on But versus product, last

going that our continue about forward, think we of out I cost take product. to you will As know,

down quite to our it continue had expectation high, that the going be but into the come on that you're mix the I is is favorability process. a see not number next that My that deals we forward as been may these installation peek – quarter. benefited it down, a it's to short So, probably mix. And average into get We are drift fourth from take – you can are last the term – to slightly know, not definitely the favorable quarter, can each towards over quarter. move we more over an when in

watermark, it drift think I the don't forward look move it, I see X,XXX at dollars great you'll accomplishment. as on short-term, forward. So, we in a down a I few a but think was as as high it

you same of see but forward, what is, or up the don't like decline So anything it expect you’re to creep won’t you kind saying going that?

there. comfortable mean, on the of in our would I really a a you're have X,XXX see job favorable out doing I XX%, what about next yeah. this just mean, Yeah, quarter over I time, on we're product mix should, discipline really you quarter we or price, what quarter. good and versus may look it on talking with I'm coming kind being at right? very following

Right. And is the I replacements do [or cycle per to that for]? servicing to down less think also on you replacement Greg, you costs able that mentioned are expect and side

combination. Yeah, a it's

right. and couple written we've the So, improve stack to there's we've happening cell. One things that blog. you And that papers, about on to could the see continued the life are in on improve. that fuel continued it's there, And a just technical within in is

that thing team Those has that entire in outputs are there. units been things, the being well that that other well achieving the make the the things managing and two done combined. really want we're sure The to managing we optimizing fleet is

longer doing we've this extra that, economic they to for where it having trades So, few had does. of and team. our quarter put life put we [foot] the more a some about good total And the there's a on what ship output there. is, One think has that optimization out the managing can helps reduced around in did into amount sites. individual field unit We a replacement them

look profitability, you growing as did you margins, a gaining to can this near business forward, see as in it when future. and the revenue also just We well as then way

process of a to through we're So, trying accelerate. that’s that

done see with the driving new and The similar profile you the very cost of other units, with it costs a replacement cost a very product total you place team's out. good see similar where job units, to on

there as need being XXXX as OEM from valuable about So, you crossover and lots you think each and we expected every wants. the see very I is should the is trajectory need and them less to gain of go good business well you forward we a get where cost, and that that we one you think out business that very service profitable, talked point we

Is be that by all the at five because that it units even only your that though – five – generation – basically generation point? all [indiscernible] XXXX is will

correct. you Yes, is that know, that is you know,

how not this about it But you of that in liability to right, wrongly so life systems, shows shipping much system megawatt our X technology and know, Michael, K. continuously you the forward data. something kilowatts, know, like a of and astounding, that gives great how Gen are have installation, little XX look speculating you a profitable know, all just is know, with been And speaking sense replaced XXX statistically we replaced [indiscernible], kind that it you [indiscernible], contractually have we you we what right we of and to in mean pretty reliability, even because operate. gave a certain CFO a the them have you we’re would talked the we installation, going important You quality, be publicly It we to reported people each repeat putting reported it and R. reason I far units, here. out is from of legacy lost metrics. with now one would that it continue isn't is, five will years, robust. other statistically lasted our XXXX, that’s them the improving careful if it and and upon, I close and is to telling our saying the at about performance this to know, as life] you be it our business. power you metrics you publically about units have making we but is come again is don't we X.XX everything plants, on you career thing the this will in those [five-year it showing speaking doesn't at average performance here. in have be, to most that And have, our had want look is, though all That

queue get [indiscernible]. you. Thank the in and Alright, I'll back

Colin next Oppenheimer. Rusch question comes with Your from

Thanks much, guys. so

about these know, think [indiscernible] if through think process You reductions rolling into through we service should about, and side, cost you flowing and how in pricing? the scaling, your sales bidding know, on the that you know, you pipeline,

at really, it's So is for Colin, way costs. into it it fuel day, the the to not us, end when the the think For them? the product for of we look proposition them, breaking it costs, value is, costs, what at customer, service about

what get, For attributes them, and quality what of is their is, alternative. do electricity what is at what with price, it the they

attractive dictated proposition will conditions by value customer market make us, an always So, and for for pricing it it pricing on to be us. the for

expand know, attract high cost lower have with it see places, going there coming the is, value we as same more we certain want as for to would proposition get So, see either may forward opportunity That’s as we that? that in add ability see to margins And because proposition to to down the as that very you you it you an value a attractive be our Greg, we market, will to as our structure margin certain customer. cost know, for it. into would economic commence. would good still cases, in, in anything will that's the not we us see that would that our we way other

exactly that's right. think I No,

product all customers as are, reduce our we've for our cost, to been for to as on are value as we our those service our what ourselves. it's where costs, where or think at costs, I customer, costs, create opportunities able prop value our look whether well installation we our can or on

want sure competitive we well we help new make it up markets but open well. to be of using can some as So, maintaining where that, us as to we're

the we how year? balance and on into and about the has on cadence move think the Okay, being how you this year of it working you to factors, about to manufacturing been we a think technology. able it margin, improvements, about should that different of the as can different flowing you product areas Can is side, about through of of number the form next progressing? the know, and talk that there's like then And into materials, talk sounded evolution

– past. about you know, Yeah, it's in talked this the we've

it's to we As it. of any I'd on part out XX% think about as tell number anywhere product, our In a quarter, our are of part XX%, cost we you out, cost think ways. about targets different particular our teams as our our operating year-over-year from It's high of XX% D&A. to get it through

their kind from give – but operating year-over-year, achieve aggressive that give may deliver team working it we to there and for within it In with back to in our that coming And engineering take improve supply how do and steps resources our and processes move forward. our to able product. cost come to product All is Our simplify may to take D&A variable with cheaper whether demonstrates we the yields, quarter-out the our on additional to we product start be forward, which manufacturing with things and that out assembled our going I'm and as help as fairly targets a part cost that, quarter-in supply manufacturing quarter, out. it ways any make the has working engineers out optimize, them them project different up as the to of we come our of been expect in out really and well it, core it of with team quarter-over-quarter, the and process, can those to sophisticated etcetera. that cost. it's they manufacturer; tools fairly the chain, particular at from look team the you vendors itself processes, chain very as our it impressed but through improve

think we we on as So, you of little add we have the how When we on cost about absorption. going capacity, bit that a the to to count are grow here business. challenge

metric. of of increase investments will run not company around. how team the and of but very much can they target is they recapture cost that some going and the our we the about is number product volume a ahead they through the on that, output use units – those is thinking that an increase It capital So, as bring to

Great, thanks so much.

Baird. Next question comes from Benjamin Kallo with

evening. good guys, Hey,

history couple hydrogen you just are project? about about, Greg, about management having change? And or marine there? developed Head new just, are those electrolyzer announcing then the and And from guys Thanks. team you some that anything know, us project of guys And about think, just you if in? product [holes] where Europe, announcements can good the you you need lines talked initially products were of or could you I to you and new talk just the a to You coming know, started have a talk there with when lab

Yeah, then I'll it asked Ben, history. you Greg on to pass sure. started because get I'll and

were generation my heat, Even a started electrolyzer. hydrogen. So, used work electricity, single the I generation going look, history That's be the very days the this [for as is with electricity, did, early that heat, about, in an of thinking of of our we Mars]. know, to technology particular and and electricity generation company, of company's product you

decarbonization we automotive, And of strong sector. one thought far then forms, is of a that make we same why and coming and place have why that for a other area, other areas is need have world are or is and of some about in way solid generating can has and coming wanting and one, in heat that in putting very this to it a places up way. it's the policy cost it coming Number industrial this matter ubiquitousness you the forms of to two, electricity down. would in it the saying regulation to a in renewable go the the attractive, realizing certain makers and come it enable that use combination, with heart transportation very hydrogen down policymakers number that like intensive the And so of things timing. coming decarbonize rather along carbon know, that, they that market oxide about we you practically it company, are about direction And is and so that. electrochemical from and research, we another regenerative SORFC, only solid I fuel is have doing and patents fuel as spoken we timing? process uniquely, of early hydrogen the can speaking It patents this be in on papers oxide XX the a run So, but is as over device and have very the as cell in that an it the reversible now? electrolyzer the run and It and process a is effectively cell direction not manner, have lot been a of in because called

temperature there This is on that So, academic to electrolyzers. the the purely if oxide far the superior This literature, in look research. you consensus is DOE based electrolyzer technology, is low solid is research.

just just not look It's research. can that. You at company

important we terms in play rolling the economy I'll it that also will product, hydrogen of a our know, and you. international out feel very you contributing addressing pass is right. and in first, So, the we development, market first Greg, confident to And transformation timing on the

R. K. Yeah, thanks,

time are only roadmap. was around resiliency, when looking that applicability its what not had first I know, its excited what pillars the five company the we with. product today, to you you that attracted Bloom, was So, and we me the at team and started know, internally, call spent the growing with We got technology them but I company really I about that

about with a So, some whether forms fuel electrolyzer. gas, be of it's the the think be carbon make unique talked of fuel is can part that I solid exciting and attractive. really really do we've our fuel cell that capture a processing there. cell, ability server play, cell just And it oxide of to that bio our Marine, hydrogen which the both then opportunity and or

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the as think team going around the forward. I conversations leadership the board with

is exists that's a what you're For it's a million bringing see And it they've seeing people around the me, do And to from really the organizations. that whether company that have size you different do take you been grow? $XXX how it's you And as hopefully that to to need quarter how that scalability. that scalable, grow the in. on and in take leaders a complexity we're business It's joined, so and make backgrounds it grows it it the that operationalize you'll simpler. way a in

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team an and have like we're So, company. feel are like here. I'm as really as about And team pulling the inflection we in a I feel a together really excited I we point. nicely

Great. guys. Thanks

Thank you.

Thank you.

with Osborne the comes question line from next Cowen Your Jeff of and Company.

I working industry meet know that or digital bookings virtual my afternoon. and folks. transitioned being COVID, solar then of I talk a but couple A was that, if qualitatively is face-to-face or could I as ones the wasn't and you sales, lack the sales with the quick you able season just on is but well discuss coupling wondering about you know that to for I Good about end. fire backlog, to don't sure you?

look, very customers. So, face-to-face. team are once is little don't and clearly, year. to Jeff, give those to say I you able And we're trying sales But get meetings getting a than sales very as our have doing only go bit guidance a yeah, and you easier a to then it's know, virtual they reaching what out we would for doing know, is you now probably well a on other they're because lot remarkable time more know pretty don't you our of to are I pretty things calls adapted that essential than and seeing we virtual But think it's not what extremely ecosystem how we there. well, remarkable. digital need this, see people are processes those process and the where spending know, everything for their you everywhere people in production traveling, I else. out online, it’s like

would I good. we use that during the The heard about talk say seeing you've script. So, would is you the say one Entergy and traction. us momentum I are And know,

by new a the way. resiliency day. no, is You the normal, the trend it getting is want the in hurricanes know, think where about not to making there it are of a country is people a different very This parts you beginning worse really of know, that’s are

service, to grid in hurricanes, how, prices is wildfires you we unit about in up. and can are that, we are top the day, effectively our know, California, the know, these we or markets whether to And quality know, are needs the the economics that, a you where prices to last whether past. some you going not but play you in it our not on And seeing Greg that the get it's of it's as are be, so talked where people not not of here going able could to up, certain, of only place

the all direction. right pointing it's So, in

you or when Is owning, multi-partner, what know, was selling? or they'll it a they will similar it. actually And they're bookings? providing you on you talk doing? referenced? A, Duke microgrids is just actually Can up who cash a it or [indiscernible] would you couple And my then sale? would about just own own, and where the actually B, anticipate operate follow to Got know, financing and customer Entergy, you is are And you're Southern the that be

relationship. is a No, this new

interest resiliency the in is common Here Their extremely interest. high.

Just know higher. you think category the, parts different the Louisiana XX hurricanes or of last two within about three days,

Nature impacted. having been devastating. devastating. It know, You been has Mother has

is in certain So, their for thinking power And of you very like know, common forward their is team their were is are And that resiliency a fraction These mind. interested top interests. decarbonisation. the leadership customer of base leaning they distributed is on something – in.

these It is it We together. interest. opportunities is exploring a mutual are

We when, share make we we discussing we just will you will and you [indiscernible], with know are progress. that find as

That's it? Got so much. had. Thanks I all

concludes time. are no There today's This questions participating. this call. conference for at other you Thank

may… You

… a is There

Yes, sir.

I just to going remark. was concluding give a

is Okay, still no problem. Everyone connected.

much. so Thank you

Investor of VP have services. good as thank So, first has as analyst Relations. thank [forged] a leaving He's done Bloom we're And Mesler. company. Finance you. public work his Mark guided our to the his I CFO. meeting and Bloom over is investor really The you proud for want Valley Mark we your and this is startup a Silicon to last join wish all year. base to team promising a community the for opportunity Mark, excited take we a very we and the with you as of the adequately in and future strong This last year connection

showed our have up We financial position.

efficient, have safety as through solution public hurricanes, Customers are shutdown. we more are Our business wildfires, operations effective. and nimble, power increasingly powered valuing our and

against expressing stakeholders the being journey. fight good they're with and change. Bloom’s affordable, trailblazing public for to you future Our joins to a and planet's much. climate utilities with with is carbon me scalable, power in Have commercial in actively our and distributions. partners They’re our low Thank partners Bloom and bright. us generation Team zero collaborations our gratitude engaging very very new their are and investors, integral robust, developing evening.

disconnect. may you gentlemen and Ladies