Q3 2021 Radcom Ltd Earnings Call
Thank you.
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Yeah.
You bet.
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Ladies and gentlemen, thank you for standing by the conference will begin shortly.
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The visibility.
EBIT.
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Ladies and gentlemen, thank you for standing by welcome to the rack Com Limited results conference call for the third quarter of 2021, all participants are present in a listen only mode. Following management's formal presentation.
Instructions will be given for the question and answer session for operator assistance. During the conference. Please press Star Zero as a reminder, this conference is being recorded and will be available for replay on the company's website at www Dot Rad Com Dotcom later today on the call are.
Hey, Y'all, Harare Rad come CEO and I'm here high Rad comes CFO.
Please note that management has prepared a presentation for your reference that will be used during the call. If you have not downloaded it yet you may do so through the link in the investors section of rack com's website at Www Dot rack com dotcom slash Investor Dash relations.
Before we begin I would like to review the Safe Harbor provisions forward looking statements in the conference call involve several risks and uncertainties, including but not limited to the company's statements about the outlook for the fourth quarter of 2021.
Its ability to deliver another growth year in 2021 and the increase of this trend in 2020 to the optimization of five G services on the AWS cloud and Amazon E. K S for on premises implementations, resulting from the integration with AWS.
Launching of the Rakuten five G. Standalone network, the company's sales pipeline momentum sales cycles demand for its products and new requests and potential expansion of opportunities. The company's continued investment in technology and R&D expectations regarding the five G.
And AI market sizes and trends in industry.
Investments demand and spending the companys cash position potential and expected growth the company's expectations with respect to its relationships with rakuten and AT&T the potential for additional grants from the Israel innovation authority the potential for additional technology into.
Gration and its revenue guidance the company does not undertake to update forward looking statements.
Safe Harbor provisions, including risks that could cause actual results to differ from these forward looking statements are outlined in the presentation and the company's SEC filings and this conference call management will be referring to certain non-GAAP financial measures, which are provided to enhance the users.
Overall understanding of the company's financial performance by excluding certain noncash stock based compensation expenses non-GAAP results provide information helpful. In assessing rack com's core operating performance in evaluating and comparing the results of operations consistently.
From period to period the presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with generally accepted accounting principles investors are encouraged to review the reconciliations of GAAP to non-GAAP financial measures include.
Good in the quarter's earnings release available on our website now I would like to turn over the call to where you. All please go ahead, Vince operator, good morning, everyone and thank you for joining us for the first quarter 2021 earnings call.
This morning, we issued a press release, stating that our third quarter results. We started the second hustled to you with solid financial results total revenue was $10.2 million, which represent our ninth consecutive quarter of year over year vehicles. As a result, we've maintained over closes.
The outlook for the fourth quarter.
About the overall ability to deliver another go through in 'twenty or 'twenty, one mobile the we though at times visibility. We believe this trend will continue in 2020, we continue to invest strategically in R&D and advanced our cloud native technology, as we announced our new innovative AI solution is also that comes in August.
This solution automatically analyze millions of day decisions in real time.
As a result, you can review underlying false <unk> networks that otherwise would likely go.
For a more extended period and affect service quality, we received positive feedback from current and potential customers on our new AI solution and continue to engage in several ongoing opportunities for this new offering Additionally, luxury being an independent digital media platform, providing analyses and <unk>.
Sites for the global communication network and can service industry named Broadcom as a finalist in the FMT Copel will discuss it glory during the quarter and.
Annual leading lights awards.
This solution uses the latest advanced artificial intelligence to help rapidly evaluate new telecom deployment scenarios and assisting fast near real time analytics. We are excited about the potential of this solution and believe it can provide real value to operators as they transition to more automated processes for <unk>.
Moving to missiles. Furthermore, we believe these investments will pay dividends in the form of topline growth is 5% issuance requirement and Ti continues to be adopted by moving mobile operators in October the analyst Company Analysys Mason <unk> automated assurance market focused for the next few use the cover.
Operator spending in telecom specific automated is fueling solution analysis Nathan stated in doing both the two main drivers for the expected acceleration in the issuance spending.
Neutral.
<unk> driven automation for <unk> and cloud solutions, which is aligned with our R&D investment as mentioned in previous quarters stand alone <unk> networks are built on cloud technology. As a result, we continue to see many collaborations between telecom operators than public cloud providers.
Therefore, we continue Wilkie with technology partners to integrate collateral base with public cloud providers and bingo operators ensure service quality and delivering a superior customer experience for <unk> delivers over the public cloud in August we announced our integration with one of the leading Klaus will vote.
Amazon Web services. This integration enables clinical multiple new tools to use AWS cloud and Amazon managed school Venetic services, along with resumes to simplify <unk> Rollouts and smartly managed network services more domestically on the AWS cloud. This has received positive feedback from potential cut.
The risks and we already have several ongoing opportunities for radical base on AWS. This announcement, followed our press release in the first quarter of 2021 Covenant go integration with Microsoft Azure. In addition, we continue to look into additional integrations to offer our advanced cloud Native assurance technologies.
Operators.
One of the latest fashion trends, we've seen the market is more greenfield operators enter into the telecom space and continually Lopez <unk> network from scratch as seen in Japan with Rakuten Greenfield operators will significant advantage over traditional predictors.
Can deploy the most advanced technology and they will not have back by legacy networks. They are in essence fueled factory in cloud native forms the stuff, we do missile connectivity and data consumption soaring <unk> opens new window of opportunities for companies other than the traditional mobile operators to benefit from this search.
Consumer demand and sales at new verticals in the U S dish TV in southern <unk> is deploying a greenfield strategy Nicole did the plan will serve 70% of the U S population by June 2023 in New York, Joe any one on one is rolling out a greenfield network expect it to be.
First we Virtualized mobile network additional greenfield operators are emerging in the market and plenty of <unk> rollouts.
As processes take time.
The total Macy's assurance solution are vital for operators to deploy cloud native technologies to monitor the entire network lifecycle and ensure ongoing service quality. Furthermore, as Rakuten has demonstrated these greenfield operators tend to choose vendors based on innovation forward looking solutions rather.
The legacy ones. So this is undoubtedly a market segment that is of interest to us turning to our installed base AT&T continues to be significant customer for us with whom we continue to maintain strong relationships. Our business has been solid in D. C. We expect to increase revenue compared to 20.
In addition, we continue providing AT&T with ongoing software releases to monitor service quality and ensure.
Sure a positive customer experience in the most.
Most recent earnings call AT&T stated that they had obtained historical subscriber growth rates and customer satisfaction across the board with lower churn and higher net promoter score NPS, which measures customer experience schools. This was the highest NPS scores that AT&T it David.
We believe that assurance solution, so vital for monitor quality and resolving any network issue quickly during the quarter, we work closely with Rakuten mobile to healthy painful the commercial launch of the <unk> Standalone Nicole expected later this year in August Rockwood Didnt cover the transfusion to Standalone.
Putting their successful data testing with the Tokyo Institute of technology, and citing some advanced use cases enabled only by <unk> Standalone. We are excited about the possibilities <unk> open up and our solution supports rossington as they advanced the nationwide rollout in previous calls we mentioned our.
Integration, we deduct within communications last fall LCP. This platform is now part of Rakuten Symphony launching Oghuz incorporated as a new organization dedicated to setting LCP and other network solutions and managed services to operators worldwide earlier in the call I mentioned, Germany.
And one Greenfield operator. This is one of the first public announcement of an operator adapting rack with its platform one on one contracted with Rakuten to help build its new mobile network and deploy Rakuten Communications platform is that's movies like within service assurance vendor choice being part of this platform.
Open up significant opportunities for us to any to the company and that was corporate commitments addressable. We believe this commitment to the environment as well as the social and corporate governance are integral to the success of our business.
Accordingly, our ESG initiatives are part of our day to day activities. We are committed to promoting the highest standards of ethical business conduct which is why our board recently approved an update to our code of ethics that will be published soon on our website. We do employee retention has been.
Key to our company's ability to run on all cylinders, we continue to prioritize the health and welfare will follow employees Julian the ongoing pandemic, we adhere to the local and regional guidelines on safe distancing policies and provide our entire global workforce the ability to work remotely and maintain flexibility.
Ours are.
I am proud of our employees and thank them all for their ongoing dedication and commitment to supporting the company's customer commitments.
Both strategy, we maintain our laser focus on retaining and nurturing top talent and creating a culture of excellence.
We pride ourselves on our cutting edge approach to five year assurance and our commitment to retain key talent remains a critical component of this strategy. This quarter to further catalyze. This practice, we launched an employee retention program to support this objective as I mentioned in the last quarter. Our sales pipeline has increased by one.
Double digit percentage since the beginning of 2021 we continue to work and a significant number of sales opportunities across multiple regions. This includes proof of concept demonstrations in several opportunities.
Reached the advanced stage of the sales cycle. Our pipeline also consist of a good mix of new and existing logos, even though sales cycle is difficult to predict we believe that some of these opportunities will convert into new customer contracts in the short term to wrap up we believe that <unk> is on an upward.
Trajectories and yet still only in its early stages and as a result, we expect that the demand for five year assurance solutions to increase I am pleased with our performance for Q3 and the fiscal year to date, we expect year over year revenue growth in fiscal 2021, and due to our increased visibility and sales pipeline.
Things are looking favorable for 2022.
We remain confident that our product offering a best in class and will play an important role in the 50 transformations as the market ramps up and more opportunities evolve.
We reiterate our full years 2021 revenue guidance of 39 million to $41 million based on our current visibility.
With that I would like to turn the call over to our CFO, who will discuss the financial results in detail I mean go ahead.
Thank you Jan and good morning, everyone.
Now please turn to slide eight.
Some highlights.
We understand the reserves mainly.
Mainly to non-GAAP numbers, which exclude share based compensation.
We ended the third quarter of 2021 was $10 $2 million in revenue increasing four months as we go into it.
The third quarter of 2020, we are pleased with our consistent growth trend.
<unk> consecutive quarter.
After a year of growth our gross margin in the third quarter of 2021, and a non-GAAP basis was 70%. Please note that our gross margin can fluctuate depending on the revenue mix, our gross R&D expenses for the third quarter of 2021, and a non-GAAP basis, well $4 $5 million a slight decrease.
Compared to the first quarter of 2020, we receive are granted $205000.
There is no question authority during the quarter compared to a guidance of $478000.
In the third quarter of last year Phonons, Israel Innovation authority discussions, we expect the Q4 growth to be between 100 to $200000. As a result, our net R&D expenses for the third quarter of 2021.
The basis were $4 $3 million.
$4 1 million daus in the third quarter of 2020.
The code it doesn't mention the launch of voluntary retention program to retain the nurture top talent through outcome.
We deeply appreciate the contribution of our employees and supporting our customer commitments and developing innovative solutions. Therefore spoke of the retention program started in mid October allocates sensitive to significant numbers of employees. This will increase our stock based compensation expenses annually.
And by $2 $7 million on a linear basis for the next two years sales and marketing expenses for the first quarter of 2020 wrong, well $2 2 million daus in the non-GAAP basis, approximately the same as the third quarter of 2020 G&A expenses for the third quarter of 2021 basis.
$777000 approximately the same as the third quarter of 2020 operating loss non-GAAP basis for the third quarter of 2021 was $200000 compared to an operating income $239000 for the first quarter 2020 net loss.
Loss for the third quarter of 2021, and a non-GAAP basis was $333000 or a net loss of two cents per diluted share compared to a net income of $246000 or a net income of two cents per diluted share for the third quarter of 2000.
On a GAAP basis as you can see on slide seven our net loss for the third quarter of 2021 was $1 1 million.
It says the diluted share.
To a net loss of zero point $4 million or a net loss per diluted share for the first quarter of 2020 at the end of the third quarter of 2021, our head count was 278, turning to the balance sheet as you can see on slide 11, our cash cushion.
Rebalance in short term bank deposits as of September 32021 about $6 million to $7 million, that's and I worked with those remarks I will now turn the call back over to the operator for your questions.
Thank you ladies and gentlemen at this time, we will begin the question and answer session. You have a question. Please press star one do you wish to cancel your request. Please press star two if you are using speaker equipment Congo with the handset before pressing the numbers questions will be pulled in the order they.
A seat please standby, while we poll for your questions.
The first question is from Alex Henderson of Needham and company. Please go ahead.
Hey, guys it sounds like you're making good progress on the pipeline congratulations with that and.
Hopefully that'll metastasized into a good solid growth next year.
I wasn't sure I caught exactly what you said did you say $2 $7 million increase for the next two years, though I'm not sure what that kind.
Kind of missed that one tree right when she said there.
Yes, I will take it.
Basically what I mentioned in the call that we.
We granted a rescue to Cigna.
A significant number of the employees and we are expecting our expenses of $2 7 million dollar per year.
So therefore this grant.
Ah Okay.
I missed that or a few piece.
My primary question right now, it's not so much on the RF side, but rather on the exchange rate side.
The shekel has been.
Uh huh.
That doesn't seem to be.
Denominated then it's hitting a 10 year highs that's as far as my charts go back up but I suspect. It's it's all time highs.
And it's up a ton over the last quarter.
Quarter, and certainly over the last months, even so can you talk a little bit about what are the shekel impact is on your cost structure and.
To what extent.
You use or don't use hedging because I don't recall, a the answer to that question.
Sure I would take it Alex.
Basics.
Basically our second expenses per quarter for about $5 million to $6 million. So every percentage is that 50 to 60000.
<unk> thousand dollars.
Look at the sugar right now and of course, the impact would be in Q4.
About 3% so it's about 152 items.
Yes.
Per quarter.
We are doing short term hedging.
We urge the circle expenses until the end of the year, we may extend the disposition and do more hedging.
And longer term.
Based on the situations.
In the company.
Is it becoming a few weeks.
Yeah. So.
I went to look out into 2022 based on the current exchange rate, which you hedge or it's going to change right.
What would be the quarterly impact.
50 to 180 per quarter throughout 2022, yeah.
Okay.
And then just going back to the or issue a D. R issues are going through the income statement expense as a part of the non-GAAP numbers or is that.
It seems.
Since I've got the numbers in Q3, you don't see it because we are.
Hum.
Then they are granting in mid October so the results would be in Q4 and going forward.
But in the non-GAAP it I assume that does come out of the non-GAAP is that correct. Yes, those expenses will be out of the non-GAAP numbers, yes.
Right.
Perfect.
Going back to.
The business.
<unk>.
It's becoming clear that our we are very rapidly moving away from the <unk> core to more companies doing told true five G.
You guys, obviously are much more positioned against that then you are against the.
The hybrid architecture.
If you were to look kind of globally, where do you think we are in terms of the percentage of companies, making that transition is it.
10% to 20% our service providers today, making that transition and then into next year.
In excess of 25.
And then another year out of 35 to 50.
How do you see that progressing.
So Alex Thank you.
I believe the most important.
We've seen the market is the commitment level to move to the pharmacy is very high I think today most of the top operators I've already have concrete plans to move into <unk>.
But as we know the sports this takes time and usually.
The initial phase the first movers in the market.
It takes them a bit longer than others is the rental community is not always a excuse me too I.
I believe the number we are today are you still on that when we go not only on the commitment.
Because as they look to implementation we are still in the single digits.
<unk> and this should increase.
And next year, but.
As we know once the technology is getting more mature then incur.
<unk> is getting there.
Faster and faster so I wouldn't say that we are now getting.
<unk> numbers wouldn't be too high.
So to quantify because we're all different operators.
And different sizes.
We are still in the early stage, we are still working on that process will take multiple years.
I believe the next deal will start to see significant move into five G. But this is expected to increase.
Once the <unk>.
Technology matures and immigration to five do get easier in <unk>.
And more predictable.
Today, it's still there are still a lot of moving parts on the <unk>, you can picture and how to implement which educate and create complexity for the operators to complete your transition.
Okay. So if I look at the sales pipeline, obviously is very encouraging commentary around their double digit increase since our 2020.
More dance.
The opportunities are.
Within the pipeline so maturing of some of them.
No comment.
Interestingly the over the short term you expect some conversions can you give us some signs of scaling around what those type of conversions might look like and what those programs might look like just give us some sense of.
Some context around that.
So we are seeing that.
In the last probably 18 months, we will engage with.
Multiple operators on there there's quite a few programs and as we know our sales cycle is a.
Usually 18 to 24 months and we see it.
Multiple operators invention in defense likely into two.
Two stages.
We are not expecting dozens of customers to mature into new projects, but.
We are.
Advancing with a.
Very very important customers that we are looking into.
Extending download activity with them and I cannot refer into specific numbers at this stage, but as you know our solutions entry level is required some significant investment it's not that great.
Most of our customers do.
Millions of dollars.
Multiple million dollar range and every we need significantly now.
It was an industry.
So.
I'm encouraged by the advent of the overall pipeline. This is definitely was an amazing global team from the beginning of the year.
We're encouraged by the overall in the industry, because we know it.
Principally the closest that they'll deterministic telecom sales forces alone and we don't have yet.
Some specifics to share.
So just in terms of the scaling of the size of the customer are these tier one customers two to a smaller new.
New new entrants type customers.
Gonna say any characteristics around the ones that you'd think alcohol wattenberg overall, what we what I can share is and as I shared before we are targeting primarily the operators that are there.
Focusing on five.
These carrier so those that are most advanced.
And adopting the new technology. This is what we're targeting.
We are following.
Yoga freeze as well the five gives a more mature in order to capture our market shares. This is this was our strategy all along and we continue to be very focused on that.
And some operators are bigger in the pipe and somewhat smaller but.
Primarily focus on the tier ones in the different countries.
Once the drugs that technology forward.
So it does sound, though that you're more in the rocket and this kind of <unk>.
New or operators as opposed to the larger operators in terms of the.
Focus a little bit more there than than in previous years is that accurate.
We are discussing with many operators globally.
Again, the trend is mainly with the maturity of the factories.
Full year investment in most countries is.
Done years ago.
Vintage is whether you go into Virtualized networking and <unk> implementations. This is where we focus this is the buckets that we want to.
Greg and we are really focused on those accounts.
We like the mix of.
The traditional carriers as I mentioned previously back in Greenfield carriers.
As long as the focus on the new technology.
Because those are the areas that are the sizable and can appreciate our technology and.
We bought these though the one that we are targeting that we have a mix of all of them.
Okay. So let me shift gears. One last question then I'll cede the floor. The AWS situation is obviously quite interesting.
Certainly you've had.
Pretty good success.
And cloudy or environments.
Within that though you said that there were several opportunities.
Opportunities.
But really characterized them at all or are those new opportunities new customers or are those customers that had been working with that said look you gotta have AWS are.
Because we're gonna be moving over there.
You know and obviously with AT&T, having moved to Microsoft.
So this is a necessity we need to be able to do a cloud centric model.
If you don't do it we can't work with you there.
Therefore, you know became a necessity or are these just flat out new.
New leads.
We haven't been talking to before.
So when we look today on the on the cloud.
Strategy of telecom operators, we see that.
The Hyperscale cloud providers.
I think an increased role in this transformation some carriers understand that it's not cost effective, though it's not our core business to run and maintain their cloud platforms.
And we see in the late in the last few quarters and increased activity for those players.
Is that a solution is a cloud native platform.
We are the we build it in a way that we need to adapt to the operating environment.
And operator with select strategic partners to do is all cloud network and cloud infrastructure.
We see that we need to integrate into that environment.
So the leading cloud providers.
It wasn't a clean out the top of the list and priority for integrations. So we will enable our slope into dosing to walk through with you.
To your question, we have a mix of.
Opportunities, we identified before and this is why we prioritize our Lucky weekly a weekly.
AWS and Azure, but once you have it.
Do you start to be exposed into additional opened hotels that are walking with them and this would be driven into.
The opportunities that we were not in before I believe we are sitting at every stage of the transition to the cloud, but we really for us. It's a very good news to see that the cloud providers.
Because one of the things that.
Holds back the industry is the maturity.
More of the cloud in order to move to full <unk> Standalone solutions the more activity in this market.
The bold investments constantly local bankers in this market I believe this will increase.
The speed of integration Society and this is as I said will be focused.
So we are not expecting at this stage and I talked about it when we discussed about as you expected now.
He wants to grow with fairly small at this stage in order to be neighbors men and exposed to the ecosystem and I think it's a good proof of our technology and our ability to be really cloud agnostic and when you have a product that is billed in the lightweight you can run it on multiple.
So popcorn is I expect telecom telecom industry to be in the next few years.
Great I'll see the floor. Thanks.
Thank you Alex.
If there are any additional questions. Please press star one if you wish to cancel your request. Please press star two please standby, while we poll for more questions.
The next question is from Bob ancillary of William Blair. Please go ahead.
Hey, guys.
For taking my question.
It was good to see sort of the ramp and the visibility improve I think that that's really exciting.
I guess, let's start off with the win in Germany as an example, so.
Obviously, you are a service provider to rocket Ted can you just help us understand how.
How linearly does your revenue ramp as rocket tens revenue ramps or robertson's usage grows with these other providers that are using rocket town. So help us think through how that relationship at one derivative relationship works.
And I'd love them so.
Without getting into specifics for Washington, and then obviously that we've been doing with Germany significant people thought eventful day.
Hold them as this is the first global operator.
Out of Japan.
How quickly and the wins.
What we stated before our business with Rakuten.
As of the.
Our previous contract is in order to cover the.
Operation in Japan, when you initially signed with them before this molecule into insurance and we expanded with them end of last year into the five Jeep as you'll recall this was the fifth largest stand alone.
Our industry.
As of them.
The way our contracts are not covering any international operation and we our potential to expand redirect Luton is where they expand into additional operations globally.
Our solution is the.
<unk> business model is more leaning into a subscription base, we are today, mainly focusing on.
Right.
Increasing the revenue by adding additional functionality as opposed to necessarily additional capacity.
Final box solution that you were selling books off the books. So we all are.
We'd always top carriers will typically engage with an enterprise.
Enterprise license agreement, which is the leaner payment in a subscription based model, where the expansions are coming while you all expanding beyond account functionality absolutely Casey.
Like we did before from fold your two five G. But then if any international openings.
And.
Additional revenue.
I'll go all out of it.
Expected revenue from a monopoly for a reason related to the operator.
Which is the mix of the operational side and the output.
On the subscribers because the.
The value we bring is related to the overall revenue that predictable genetics will be subscribers is always Q. All these to improve the customer satisfaction and improve the retention of the subscribers. So we typically.
The size of ours.
Our solution based on the on the revenue base or their subscriber base with the opening to win this revenue stream to output that it gets when they get from their subscribers.
Got it that was really helpful. Thank you.
To touch on the AI piece too obviously, the AI piece makes sense.
But there's a number of players that do sort of network monitoring network optimization not on a telco side, but certainly for cloud providers somebody observer ability players do there some of the newer vendors.
On the software side, we'll do network monitoring network management, I'm not sort of quite what you do but help me understand the overlap of the competitive nature with some of the observer ability players, especially as you go to a pure software.
Loud based approach.
Help me think through is there competition. It depressed it's not your traditional competitors for the AIP and sort of how relevant that is.
Yeah. So so we have a specialized vendor that is our expertise come with understanding the fiber network. We are expert on analyzing the different network functions and the flows between the functions. When you go to those generic.
The AI companies, usually they give more generic.
Engines, and so on but they like the special network expertise. This is usually where we play we're not.
We don't see today competition from these guys.
Also on the technology, there might be some overlaps.
Cause the telecom still require a lot of that specific information.
I do believe that there is a this is something that we monitor and look both in terms of.
The opportunity and also in terms of risk is the move to the cloud opens not only.
We talked on this from the from the fire, but it open up some additional.
Additional views as they are.
There are other players other solutions other alternative both of them the risk side and both on the opportunity side.
But as of today, we don't really see any competition from the non let's say non traditional.
Rentals in the telecom space.
Gotcha Gotcha Gotcha couple quick tactical question for me just an update on Latam progress I guess, a completion of our timing of completion.
And then one quick one on Ace, but let's talk about lifetime first.
So.
The Latam project is still ongoing.
To do equally.
Good progress in there.
And currently as planned.
Yeah.
I'm not sure if you have any.
Additional to add on that.
Maybe I will take you to make an important.
The reminder, there.
We talked when we won this success.
Just blow this order that we got Oh.
This was part of a bigger all the fee.
And we are continuing to engage in part of our pipelines is also to expand into additional lean.
And he is in the natural and this is still active and followed by clinical attention.
Gotcha Gotcha Gotcha, and then just on Ace quickly you know I'd love to understand sort of how you think it's tracking with the expectations.
I know, you're not giving guidance, but you've certainly got visibility you talked about pipeline strength, you've talked about some of the wins <unk> had.
You've had.
How do you think that's going to sort of potentially track over the next three to five years.
So the Russell Macy's.
Right product at the right time, we we took the.
Time, and the experience we got when we started to work on social virtualization back in 2014 2015.
<unk> decided to invest in a whole new solutions. It is really a beach club basically from scratch.
Using the container architecture using micro said when he says he says though this includes the <unk> technology as part of the of the coals to capabilities.
What we are seeing in the market is that the feedbacks are very positive it looks like the right time and adding to that all the increased focus of the cloud providers.
The telecom space is another good example, why the Ace product is exactly what was necessary because we've just technology was not really optimized all capable to run on those environments.
I believe this essentially go side to side with the <unk> development and it was still in the early stage of the five G. If you look few years down the road any carrier that will adopt.
<unk> five <unk> Standalone five gene it was located equal weight.
We'll need a solution like the reticle mace.
I am I am.
Sure this is something.
That is clear to everyone.
Some work at home solution that you can do in the short term, but on the long run you will need to have a.
Fully containerized cloud.
Platform. If you will the network is going to be fully containerized cloud platform as their assurances typically tightly integrated into the other network functions and tools. So overall.
What can be market is mainly they're not gourmet product. Most followed type thing is already based on that article based products.
Overall as I mentioned I feel positively encourage full day advancement.
The visibility we have.
Fair enough fair enough.
That was Oh, great. Thanks for the color and I think taking my questions I appreciate it.
Thank you very much.
There are no further questions at this time. This concludes the Rad Com L. T D third quarter 2021 results conference call. Thank you for your participation you May go ahead and disconnect.
Okay.
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