Fluence Energy (FLNC) 9 May 242024 Q2 Earnings call transcript

Good day, and thank you for standing by, and welcome to Fluence Energy, Inc. Q2 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Lex May, Vice President of Finance and Investor Relations. Please go ahead.

you. Thank welcome Second and Conference XXXX Fluence Call. to morning, Quarter Energy's Earnings Good our release our and presentation, sheet copy Investor financial earnings A of on posted press fluenceenergy.com. and regarding results, the with measures are reconciliations section covering along and at supporting including statements of schedules, Relations disclosures non-GAAP website financial metric supplementary

Boll, Officer. our Julian Chief Executive and me Joining Chief Officer; our Financial Nebreda, on Products this morning's President our and Rebecca Ahmed call Pasha, Chief are Officer;

cause During this various make relating facts. subject company SEC of assumptions to based the forward-looking impact information to certain that are, actual certain not to and Please our are for differ are filings and regarding uncertainties and results. certain and may our course upon therefore, refer materially. certain risks to management and for Fluence call, expectations the could could business statements forward-looking future historical matters regarding statements that factors results statements current our and more risks uncertainties. Many Such our

are undue these speak statements, which today. reliance as to place of You forward-looking only on not cautioned

our the Also, information. comparable non-GAAP or performance call for website. that statements revise also materials to most is new business. A the in earnings our in please of on non-GAAP duty view update to forward-looking GAAP the these company undertakes reference as we measures measures note the company's that will Investor important This no assessing available of Relations reconciliation measure

prepared our session with team. comments, a our we question-and-answer Following conduct will

call, please to the initial I'll to more Julian. participants you now over an turn this to question very give on follow-up. Thank one opportunity During yourself time, this much. speak limit call and one to

on send today's will then strategic I our I outlook. and our details Lex. and warm our business on give and on provide employees review Thank would to then to our objectives. progress who will call. Ahmed a financial you, update participating results are brief welcome like more investors, analysts a on

second on third had our pleased key strong $XXX double-digit We performance with quarter the financial cash gross highlights. we consecutive quarter, margin. increase Slide in revenue gross recognized and that our margin X a generation. I'm flow and of we delivered Beginning of the million to report as

was Our for the million, We million negative the $X EBITDA $XXX adjusted the second million same $XX quarter of increase improved an quarter approximately last from cash, significantly from with ended year. of XX. December period

million of Additionally, we new $XXX recognized more than orders.

X.X solutions hours, XXX business new of X.X orders. business and gigawatts gigawatt services our added business digital megawatts contracted added Our our

$XX.X of line The as billion, March quarter December was XX was confidence and level, number $X.X additional increased the to revenue and backlog year contract couple order revenue additional intake. of which beyond. offset 'XX opportunities signed in our small the pipeline, in which this billion increasing XX $X.X thus growth us of Our as outlook by growth a adjustments in with giving recognized our was of reflected million fiscal our for

gigawatts our digital We business, strong in $X.X our had to quarter backlog. adding contracted a

of March as management March In revenue, services digital recurring XXX of XX. and gigawatts million to $XX annual improved Our megawatts XX. ARR, to digital our under assets summary, by approximately XX.X as increased combined or

measure that I'd guide strategic that on to X our our X. investors also actions. the against. like markers They Slide discuss can important performance to Turning decisions progress objectives are our and and monitor

and significant fiscal of in working that generated capabilities pleased a of of profitable the $XX generation. management we approximately to record our amount proof report year. point have of capital the a half cash business cash free our delivering million on first a of result is This I'm growth. success that First, for amount of flow model

and continue our develop will to solutions that need. customers we products Second,

line the X,XXX more detail. to during that larger in which report to series, discuss is pleased and will more Gridstack which am enclosure, X-megawatt Pro I include I energy-dense we the XX-foot our such, As quarter, a expanded

our Act, or that on our contract incentives signed IRA. domestic from Reduction Additionally, we will first content allow customers Inflation benefit the to incremental

seeing U.S. domestic on We of products. for are domestic tremendous content first positioned to companies of as the are expect we well momentum interest under IRA. from to we this are products with We the one qualify customers capitalize customers providing we capable believe for that content

year. to This Third, initial we U.S. module facility later battery U.S. for battery for domestic us our is content will meets our product track key provide to at piece enable a storage. and begin the that requirement battery manufacturing are on model a that production this

driver. Fluence about differentiator contract by XX% year's a use will report on this to pleased we from Digital I competitive that as year. basis from dollar backlog this a last increased margin Fourth, am digital and time a -- our

inaugural provides And and our is second disclosure better. its Fluence's report sustainability upon April in Fluence released report, I'm strategy, more will annual builds proud in objective April, state a an touch updates fifth in which the sustainability to 'XX work published to that which moment. I on from sustainability on

X. Slide to Turning

to demand is quarter intake or order consecutive growth showcasing for scale in robust of growth revenue the pacing utility in scale energy XXth energy see continue the We strong utility recognized, storage. This storage systems.

visibility provides billion $X.X future of backlog strong to Our revenue.

revenue conversations midpoint. we're customers, recognized and continued see our 'XX from year-to-date. our by have of with and XX% our in midpoint end, to we XX% we're potential discuss to in ranges guidance fiscal reaffirming backlog revenue EBIT. growth approximately fiscal for we our more the adjusted the of guidance having To plus 'XX that of approximately will customers strong on Ahmed Based expecting both revenue As guidance detail, covered XX% are revenue

from approximately quarter. our grew is outlook 'XX last and which underpinned $XX.X sits billion Our billion $X.X pipeline, at by

over by I the Our expectations is the for pipeline see a around encouraged months. XX opportunities world. XX% number probability conversion at am increasingly growing of the we next

This for new opportunity major scale to of for see can BNEF China. gigawatt as on growth. utility additions is nearly the XXXX, storage continue now a forecasted capacity you us from and XXX As chart slide, our this hours including between global

have strongest market Germany, some growth, the of the expect We and third example, biggest to largest presence significant a see market. European United outside the for States, we in markets where our

and is towards accelerated as out nuclear Battery increasing and reliance transition gaining fossil phase fuels. a in energy country power to on renewable and reduce storage significance aims sources Germany

As a result, BNEF XX capacity nearly gigawatt this sees now new market XXXX. of hours and adding between

now very, is a has largest gigawatt market. opportunities Additionally, come been market. for quickly successful solution, hours this transmission BNEF Australia added between capturing XXXX. XX new of become they and our have Germany market to sees growing Ultrastack, our nearly market we as very and second capacity

continues energy the future, market storage a is sustainable towards experiencing significant As more battery to growth. transition Australia

this been market successful have of we we We to are presence And portion these capturing a our forward. move expand as opportunities. good committed in

domestic Gridstack a of between This gigawatt of Pro offer. enhanced States spurred modernize nation for sees towards XXX Battery and is infrastructure, is Furthermore, standard its largest represents U.S. product energy such playing includes a sources seeks as United capitalize the cleaner resilience XXXX. more our storage power. and an us as demand. is the role significant offering nearly to our amount added BNEF transition and on content amount to line, The which and with our the hours tremendous new increasingly IRA market. vital opportunity now has a U.S. huge grid in capacity and of sustainable

States demonstrated changes and utility to resilience economic chiefs political the the in battery scale importantly, and storage sector administration in has remarkable strong to energy for United infrastructure. foundations parties and clean modernization largely More support and due by grid

cost projects flexibility of in technological battery factors, scale storage success capacity driven and solutions the utility against and technology, The grid battery the increasing of resilience. its economic by States the is for and as advantage need declining other United urgent firming just

fuels. robust the landscape intertwining around the renewal has of storage energy had and support opportunity and and driving to positioned Overall, becomes advancement technological continues utility-scale as very improve most energy spectrum. component sector need that the to energy a American on cost states of source the political increase U.S. energy relied traditionally even continues with economic storage outlooks The the remain resilient economical for its as fossil battery all and

Turning of and enhance wide to needs serve X and significantly expertise X,XXX, Slide The operating comprises the line has to consistent Pro project a components, line sharing each systems versatility solution. of ensure X,XXX namely and Gridstack series, the X,XXX board. domain Flu storage to sizes, expanded X. any certifications enclosure the Fluence's its the range core across

different maintaining competitive system the approach per This specific precisely energy Gridstack for enables hour. to issue prices. of configurations, of a enclosure the addresses By kilowatt use modular cost Pro capacity, variety meet while of overbuilding reducing offering line and contributes requirements matching effectively of the to and social projects the allowing of mixing

to utilize ability expansion The to with integrate and the the Gridstack line platform highlight modifications Pro cell is new seamlessly our technology of to our one platform. faster,

hours X-X XX-foot remarkable X,XXX series the Additionally, megawatt in impressive energy a offering has single enclosure. density, an

This high not land prioritizes line usage an only surpassing but or it also for overall making energy space-constrained Gridstack enhances efficiency, developed as successfully commitment and Pro any This of solution ensures size test. Moreover, provider solutions. density safety, attractive project the Fluence's installations. standards a optimizes reinforcing stakeholders store by of industry internally reliable passing [indiscernible] peace safety mind reputation Fluence's customers the to alike, for

related by systems, line to any developed Pro Fluence or Gridstack software, the management issues. controlled and modules, battery fully built mitigate electronics Fluence with all Furthermore, concerns policy is cybersecurity or to

customers, the bonds and only U.S. cells the the adoption eligible offers under to any goals. storage security incentivizes Pro credit pack first Fluence of manufactured nation's the not solutions XX% supports United investment initiative and store Fluence service battery the manufacturing but tax the IRA. line domestically making the This To modules, sector, contributing the States, one domestic energy better Gridstack the technologies of with for sustainability also in

Turning to Slide X.

incremental do tax coming qualifies content we We're As domestic recently as against quarters a content to additional non-U.S. to customers interest tremendous from investment XX% signed first for the additional the is seeing and that product contract we ITC. in include expect priced allowing capture domestic for XX% that for sign competitively our it customers an alternatives our I offering, not contracts mentioned our earlier, credit.

of own which our payment proprietary U.S. per Section also established at the heart incentive of qualify and the manufacturing $XX for will benefits, kilowatt criteria model we by battery IRS our content the it an U.S. domestic offering, to for modules, produced modules battery Our x key meeting battery department. includes XX treasury in is By the is

are on year, our We over subsequent to later up gradually production quarters. ramping schedule begin the this currently initial

proud has on second Fluence's builds provides the disclosures sustainability April in to which sustainability Turning to and in updates from 'XX published I'm X. report, Fluence April, report annual report an inaugural sustainability upon Slide that strategy. released its

business travel into expanded highlights our Fluence include: green to emissions Erlangen reported of renewal footprint Some gas off reduction clarified switching from report XX% including facility our for global and emissions the boundaries. and in from of offset efforts X the X analysis Germany electricity. Scope flights, our We kick XXX% we Scope facility

the I'm pleased conclusion, quarter. with the achievements of second In

Although work progress we're be mindful there's we continue still look will this to through momentum 'XX. as we done, to

will Ahmed. to turn the over now I call

as I financial million the to billion. I revenue million We we than revenue, guidance revenue generated $XXX morning, approximately note our of our good midpoint XXXX $XXX results and XXXX of or at Beginning year XX% able annual in on quarter then complete full second us our to Julian, prior and second you, of Americas million quarter. half everyone. $XXX XX% expectations certain of our third in Thank that of puts the discuss results were or Today, is will like would with in the XX. billion earlier which quarter $X $X projects year-to-date of first review guidance. ahead Slide

margin Siemens results settling of $XX gross generated adjusted litigation we consecutive gross with In pending third also quarter profitability, include modest terms double-digit our expense representing approximately margin. These or a of the million XX.X%, generating from Energy.

demonstrates that backlog. us, we issues our benefiting behind from are further backlog are execution higher-margin our legacy continued Our and

bottom versus 'XX in improved approach first reflects Our our to This $XX also Overall, 'XX. negative QX of we deliver million in our More $XX million these million, line were improving $X negative from commitments. negative reflect EBITDA operating which quarter, million continued our grow momentum improve revenue XX.X% specifically, our believe this on in to $XX XX% quarterly quarter. top expenses to the our materially EBITDA. results line representing and financial disciplined in is QX and down

X. Slide to Turning

working I capital like would to on free yielded continued positive in share proactive $XX our performance profitability our that Before positive cash our talk has I year-to-date flow This reflects million. and liquidity, focus management of results.

an energy $XXX quarter quarter second fourth ended In total and puts in we our an which have quarter report I terms that increase position. since cash to million pleased of market. last believe cash, growing excellent cash, of capitalize of the of nearly summary, In approximately we million, to with position that million consecutive the am total liquidity on $XXX storage we we total increased us the $XX

XX. to Moving Slide

the midpoint As have this guidance XXXX Julian At in the outlook on of spend of revenue the ARR on the $XX revenue for $X.XX noted, moment by I to track we adjusted revenue XXXX. guidance a ranges year-to-go EBITDA for on second based to both year, our end midpoint first our actual of covered are achieve fiscal our performance of half, at expectations. in of half. Furthermore, projects would a and are plus point our we for we million awarded like reaffirming and approximately recognized respectively. billion, approximately the XX% year-to-date also by

approximately third reflects of and XX% fourth quarter. which second be expect our projects the this we delivered in of in to half in timing factors: XX% first, largely QX quarter This year. split scheduled our be revenue to backlog, Specifically, in the the realized X are

As milestones. our certain a revenue we hit recognized as reminder, is

our factors and $XXX our previously majority secured us deliver QX million for manufacturing slots end, that revenue is our are our QX to control. on within cubes, had confidence from into the of which and example, of revenue To second, QX. pulled logistics. milestones have batteries, delivery For I provide as These we mentioned, of project necessary ability in the we approximately targets. And production

fiscal to to XX% achieve growth range. continue fiscal revenue our from approximately XX% the 'XX that we ahead midpoint Finally, believe year-over-year 'XX, will year we of looking to guidance

back the that, let closing With for remarks. me turn call to Julian his

Ahmed. you, Thank

I XX the and conclusion, to key to want from emphasize results. Turning Slide this takeaways in quarter's

a record for this approximately point free also had success free for $XX generate. strong set year. position proof we million. cash of our flow it million flow of and nearly in the is cash generation of our cash This first generation First, half a the model the can of to This contributed $XXX business liquidity

Second, the new for great opportunity customers. there very to products is to deliver outlook is our for utility storage our And value robust. a scale

do from well not significant our space any importantly, elections, as the insulated More U.S. anticipate is impacts upcoming a demand result. we to and

we U.S. for this position to we domestic year. are on Together are manufacturing to module a the begin for we with So our track customers, content qualify in our that U.S. prime later bonus. demand products believe capture

shareholders. this commitment prepared margins, finally, double-digit take now third consecutive is And to attractive questions. our of we're acquirer to remarks. deliver to gross which concludes my reflects our continuous Operator, returns This ready our

Genuities. question first Gianarikas our from Canaccord comes And from Instructions] [Operator George

all, have traction the much I at was discuss can how maybe center if if changed, you've you data there seen wondering and how your conversations opportunity recently? and

Great. Thank George. you very much,

artificial GenAI happening all GenAI solution, technology what's the or of So As with data providers coming general up seen GenAI and with the what a technology a intelligence -- units, the commonplace we've the centers? with allow needed. they become technology more requires Xx are that energy, lot the chips processing computing. And the graphic require for GPU what chips parallel old happens that you this more which technology

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follow-up seeing on something increased your storage that as to energy solutions? Is Maybe radar? duration Are that. you long for that's a interest

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comes question from from Brian next Company. our Goldman & Sachs Lee And

the of cadence was revenue. I Kudos had just I one on the -- the but X of solid guess on execution continuing had them, here. question I

significant into talking weighting You're and the versus forward the about XQ. revenue quite pull XQ then

these like of have around a timing projects. the high of So it sounds you confidence degree

the you cadences back-end visibility that's weighted can speak that happening -- to sometimes the outlining. market here sort really gets XQ of XQ, about I anti But with know and you're

over out? would those any time So helpful. of be what's provide color confidence turning frame slipping of risk projects to level that Just any your visibility of and potential into in kind you not there having kind can

I think So because revenue first, it's to to I important know. talk recognition let's get think

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equipment okay, manufactured bulk what the this? And to it, at quarter of the exact transferring be of deliver question, looked our close to We revenue need big you which title and it's great it, title fourth give looked all once but quarter, to transferring it number, at The more is manufacturer, majority the you your title a it this to it to on -- we is equipment. of When need not fourth is now the you significant can you when portion have customers. or to -- significant big of of a a than a -- transfer customer. you

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of is of cubes this here doing XX limited to or title by driven We've projects, good not back, this. been amounts. transferring -- manufactured to delivery very our number huge very, are not at talking XX, mostly we going So customers,

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unless believe trade, is the to should -- do world we this. be that we there so disruption the global stops So able

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over Ahmed more color. I will little a let here add

months' would and have only on thing has project And I last is on executing budget. I look Julian on what question. been the fair mentioned add A we at time every XX if think our just you to performance,

deliver ability that we and in cubes those think in logistics I delivery and for our confidence gives when equipment particularly lined to up additional have QX. us all

that I I additional could color, Maybe more, all guys. in gross one. squeeze a Okay. appreciate one if margin

the I of speaking high XX% the margins XQ. year, still about end to outlook XX% know in XX% But have range, big you're this exiting of to you you're fiscal revenue also to of if gross you've targets, not the EBITDA. the gross have sort of it's that the all about fans momentum You more talking 'XX. for got growth margin XX%

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even gross XX% to -- very adjusted though, with this to is I still I So -- you'll you on of to me said, know margin like don't wanted all XX% let year, first me a come growth EBITDA. you much. as

clear this. So on are we've -- we been

year, this XX% For XX%. to

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over line growth, to our XX% midpoint top this XX% guidance. year's For

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And Research. our Wolfe Nassano from next question comes from Dylan

getting wanted all? read-through So are interconnection been back-end there's to Is your of the et about to the delayed, any check, exposed just guys question a talk issues, answer there at year? you about lot something projects of to solar Is recently to this rages, Brian's equipment cetera. weighting

a sites transferring happens products said, -- transferring the I of most to we ready. manufactured in it cases the site as our very delivery what of when lot is to very mean, I drives Usually, to clear are be and really. back-ended Not title what the our much, title. at --

are usually where contracts they have a the months, in to we EPC we not to connected built our take in in title time, title required know, our but than our are delays, where more to point customers seen we where customers you cases on contracts, specific a have when in in delays, weeks some are had is have backlog in at required stuff time. so what take usually cases that rather things As rule have --

So that's are what works. generally we -- quarter. to get you works. see see we Can 'XX how in have for we we sorry, the ready. fourth are still it -- them for projects civil What are in that the imagine These 'XX,

elements certain related any have delivery that things So exactly customers our delays end that let we could are. at been have not projects. And know I Ahmed working projects the in day, after the are take related to and safeguard required with where that. delayed know we to... or title get a disrupt do We they we customers foresee if the will of we point, on the

No.

thing contract they would all signed when only permits I add proceed. Dylan, XX, those notice sign customers that's these the when we months contracts ago. think to we already issue and place, a a construction, have And XX I is start generally, the I, in think, or

with reference your pretty nothing that question, feel which the pending our good derail they we there's have because -- as issues. to particularly So about interconnection is such could execution

would Any it. Anything then recent a there just litigation Got helpful. kind outstanding follow-up. And with say [indiscernible] can you of be developments anytime soon? quick the any of expect

Dylan. Thanks, Great.

litigation. remind -- in the settled as we So call, the we have we Siemens AG customer Siemens everybody related shareholder, litigation, Ahmed a the I told is or think may litigation, that was And Siemens business you immaterial shareholder. Energy an mentioned immaterial. litigation, course settled We is normal Energy that of past, Siemens just to be our listening, our not but during to shareholders. who Energy not

And it -- in Energy I customer it's a that even the the past, litigation significant in not claims Siemens customer had. it's the We more have the as terms said than settle is a immaterial that a fraction of customer. and

very little have with done very, we what them. So

you we It's of normal the of litigations litigation, lose when a start business. course So resolve you problem. how part

both the Energy for Siemens that a I think ourselves. resolved at of it day, the way satisfactory and we end in was

pending X, as past, Siemens the nothing was also to said, mentioned, stage, as litigation referred has as the on. -- talked conditions I is parties. on litigation the -- something moved I beneficial repeat incident, stage, that material that really really agreement we is The nothing the no there's it's that. other a one, the And at which well. And and really to landing outlook was there. material the have immaterial to, also Siemens significantly we it inform at nothing Energy, again, nothing is And in the not to litigation there's which most this communicate immaterial, are this settlement you that other both settle there's litigation, to Energy no

issue you. that putting on Siemens behind congrats And

Strouse comes Mark. And our from JPMorgan. Mark from question next

up on there. following So Dylan

But getting that guess -- maybe an there So when a to I when with about your quote, backlog several would delays final a elongation issuing you're order? Any of the anything the you're appreciate you're years, next just I having far my between timing you're as the projects. you're delayed? qualitative projects in kind of getting pipeline, kind of looking you're potentially conversations your be seeing folks as is at not seeing question there when

usually can the queue into the that our mature you -- are projects that are can within convert we -- that usually are months. interconnection XX next are pipeline projects see comes in these not because backlog we into very What deliver

there years delay generally, problem been queue. because you when -- they've are type X of they to in already us, they come So see that already don't the

exactly anything. very, they that connect, more becomes very execution what to So they they It's how it -- and they know need more than one know do. an

something leads, you, are the much that believe all all customers those which planning tell our projects have -- them. less conservative projects ready at We we are -- that that but our a necessarily are pipeline, the long-term mature. of we some is with of at to you customers. Those for view not probably look work don't disclose looked that will that of more we I'll as And have we that are are we we of which

look has seeing deterioration seen were the We know coming timing don't any same. year what -- into the of significantly at from been players. we more if at is It them is getting I will queue more is of lot has queue of pipeline U.S. that all the in huge. Not so into the it a -- whether terms a already almost that a you and see battery in a lot convert. the So ago. terror group storage And

the in and projects explosion, an that what leads, will I lot that, I going seen can a are is give -- we that that -- color of have the you the those. more queue are on those early So things say and a lot

very, our that forward. us going We very has -- spend very we confident strong we of -- not this most tailwind, tailwinds -- time. But that's huge very, makes are that a business where we

any a In issues, any we very, seen and queue. They deterioration haven't And X X, delays, projects these sort very said, very there the much they transmission of they countries, mostly -- happen. I other differently. have it know I issue, in though And U.S. when terms even mature the last to the going queues manage usually of have X pipeline, almost year. -- that in have our as years they're we been already

is happen So a in once mean know systems more something certain a lot other markets a by certain. What certain, a are you I you date. that into going to lot get more line,

so work differently. And they

have the the years, So you that the on years situation the U.S. see you where queues don't line. X in X see you

But is I when highlight, me repeat is and you think I'm going never this of -- But a the ask tera X at looked great you blowing if to news to this quarter, opportunity. nationally -- almost point. and which connect number queue the we're to capacity, of in great X,XXX X it's the U.S., tera grid, a looking mind gigawatts the of to

looking quite Congrats there. folks great conversations necessarily on That's I that for Julian, your specifics a imagine on having Yes. but you're follow-up. first other domestic few with a content to contract. Not contract, signing hear. quick

You've your would kind past range. of still credits target you margin in put said the gross tax XXx in that the manufacturing

commentary if of gross to an now impact. more margin curious Just that these contracts provide you update we're hitting, more and getting can about on closer that

the in -- able sign we As of the content have that, the our all significantly most Because because content our ability manufacturing any is an working said margins. first offerings to what domestic wants our customer some I we we in because on XXx said We're XX%. from other we deliver believe to the our be one. And the XX% first-mover the first-mover the opportunity advantage within trying $XX we we have we that us. potentially have It around we domestic past to to are the to of of there players only is secure been to a out. Not way are that's -- should who module to expand to What going of for not are U.S., move the us capture said, have advantage it. offer. believe risk per the

we we advantage, to of way, detail I many in early secure but the the we the the point, it's eats which don't looked think by the risky myself have mentioned to comes far at because But our negotiate still against when are times we mover communicate that. competitors other that I not because offering, that stuff then way what most less announcing I capture that me. and in and of said it. are want too it's only believe -- have because something is past, it's to first

one able I the the competitive provide certainty be that a Our think offering that. capture is will most robust, customers higher that that to And will advantage. also is

So I feel are staying tuned. we

forward. But on it of this content to domestic an dependent and will content, 'a mostly of 'XX 'XX is revenue domestic and order going for 'XX our anyway. said back intake in none always not onward This revenue go 'XX, not -- have is -- we is just XX revenue generally, will We -- more.

question comes And from Clare Justin MKM. next from our ROTH

seeing here. that demand strong on content you're It the just products adder. the very follow-up will domestic like domestic qualify for content So a sounds for

much cells into domestically battery U.S. wondering, just this how So include into think your a your we Could XXXX, total produced of as in XXXX the considerable of market? battery portion head you sales even sales do and modules? then the in U.S. and be will

content that players demand stakes U.S. the happen time, overtime. this table U.S. we I'll -- that as table main in be believe will is be over immediately. the It going stake will not domestic to you say this will will --

of be to to revenue now the only view How majority be So 'XX, will long 'XX, and combination there of a along. It's the distribution represent most the these this will will projects. get great -- will of our market. exactly lead difficult is the forward U.S. time, our time content? over designed tell way domestic domestic content -- of the 'XX much the and be than it much plan will will some be we -- the -- move what as on we that in will because you But be have the how

Got it.

in then could magnitude us And of just potentially the expand U.S. you be update expansion? your plans the potentially What potential or footprint just the that, your can internationally? manufacturing given to then Okay. and either on timing

Yes.

to continue our work in U.S. the Utah We at facility in

not moving looked have today, of plans some some We the have of at been we have set. -- the But dates cells. production battery those -- near

So plan U.S. is now, in Utah. staying in current for our the

in that markets the biggest facility U.S. expand. quickly. seen western capability most can expansion of still our have has to the double are and the the We We today side of

dates even the though have So to -- set Eastern any potential on U.S. side real we the any the plans have we not side expansion for any the not closer not of eastern of

continue it. to of terms look Europe, at In we

So that an be continues evaluating. we to are that opportunity

dates haven't We yet. set

it build -- ecosystem. We requires are to an

set base So we and bigger -- that's looking economies as scale, for. what and we're commitment. reach build are we will ecosystem And we that of

companies our and -- great faster at I manufacturing that we only manufacture believe create ecosystem out can manufacture we India in can And but products, then we're can combine probably there's detail to for than we in India, create looking would of market, -- will India APAC, say, we an we that we that build Vietnam, to ecosystem place serve great a an what be could today, -- not Europe. more be

to we our capabilities -- in Eastern where India the are Western manufacturing So or next were in that U.S. announcements -- our than the will in terms if be -- first probably of I rather today, Europe. probably

Sandler. final Kashy And Harrison final Piper our from And question for one comes moment our question. from

is just events, have Just customers still from take a And you? saying of them your the there contracts if outside taking securing any Julian. scenario you could title in even a require which then to clarifying equipment majeure question force be title. in critical that them you, delay there that for Were issues

are require take our to contracts customers What delays. our if if I title said, there significant

the have is or there ones our the of If site think doesn't I title to ready usually of site. at have in [indiscernible], So the they end the close safeguard customer who process. the equipment, take a day warehouse a certain by

-- but that more a which happen all communicate as makes but time, -- fourth to -- our doesn't me use, feel message safeguard, confident So I'll say that safeguard the it's quarter trying -- 'XX was I pad had revenue able much a that the a customers is for putting we've take problem if or that we last very, our said years, we are the the doing very one anything, been -- be where customer. But to even in locks will good. is today secure seldom very

very have very, been good. customers Our

a We here week delays, nothing or have not maybe seen a there, way significant. any any major that's there, week but in

understand you that I complicated, our And the for the were to -- the Yes, I customers, revenue to fourth wonderful. not this more to issues. well X.X things provide mentioned, was can do very as something do very it's contracts we contract hey, of things all And major always this been XX, was XX or to last you very, So logistics, -- And in I it. work. give amicable do I constantly. But is you get this not and great. It wonderful, know still use we said, it. provisional a a something with not how that's it confidence very, bad do the all for the year generally, not that way can reason, we in this essentially that if that is years, exercise many we've customers, Ahmed quarter, any because if we, manufacturing have safeguard. doing

I will it way the out. put that's So

equipment, of through transit time very couple I the have different to Red passes situation But Sea, force But volume added Red that XX%, within with it even in today the our a mentioned that, we except the weeks majeure, X-X to very manage that's the Sea, able it, Sea, our world. a we the low. through very, time. lot don't even more -- a think of as Red our were of then something you for we said, that

Middle we situation, able very, do it well. let in a it. manage a very We East, war were the even to in can So say,

to that's where will our in order really it happen So could capabilities. but have unfortunately, to be disruptive really, It something disrupt we...

helpful. very, That's Yes. all very

a And number. pointed follow-up maybe the you comments XX% slide is so question, about As for the just in more deck. out, big my

growing, ERCOT, is specifically CAISO demand highlight You in MISO. and

Just discussions secure just and selling your of you customers, -- have wondering PPAs merchant difference your in your they to take. on in are what whether approach if proportion any which financing signing a customers ability depending of with have there's versus their sense

Yes.

with Global the generally, Tier -- On the U.S., and X. in say we, financing, worked with have

view will don't exactly much PPA U.S. mostly financing hasn't have number. But PPAs. really you, I been conversations, what know mostly don't they because they I about from cannot tell the from are I But they PPAs. me. how of I -- from it is So the how tell an you my merchant. XX%, the And versus KPIs, a I but what -- want issue. for they know have my want I in that,

the to KPIs, to connected they PPA committing their Our are counterparties.

just We'll of know So was we much have majority, the of top versus our -- a of order say number. the that's is to the merchant. know how with from the question get don't a I point get intake. a how of I sense. good don't firm what I really great That's the of a my head. make number. PPAs But number I'll It

May back to call to Thank closing comments. like And the for turn you. I would now over Lex

on and Justin, you, thank today's for you, participating Thank call. everyone,

results. forward report a good to free Have with when to to reach day. you third our please feel have If out speaking We questions, you any look me. again we quarter

today's concludes for participating. call. This Thank conference you

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