EchoStar Corporation Q1 2023 Earnings Call
Okay.
Yeah.
Good day, and thank you for standing by and welcome to the Echostar Corporation first quarter 2023 results conference call.
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I would now like to hand, the conference over to your Speaker today, Dean Manson Chief Legal Officer. Please go ahead.
Thank you good morning, everyone and welcome to our earnings call for the first quarter of 2023, I'm joined today by Hamid Akhavan, our CEO and President Paul <unk>, Our Chief operating Officer, Jeffrey Boggs Senior Vice President of Finance.
Veronica.
Our chief Accounting Officer.
As usual, we invite media to participate in a listen only mode on the call and ask that you not identify participants or their firms in your report. We also do not allow audio recording which we ask that you respect.
All statements we make during this call other than statements of historical fact constitute forward looking statements made pursuant to the safe Harbor provided by the private Securities Litigation Reform Act of 1095.
These forward looking statements involve known and unknown risks uncertainties and other factors that could cause our actual results to be materially different from historical results and from any future results expressed or implied by the forward looking statements for a list of those factors and risks. Please refer to our annual report on Form 10-K for the year ended December 31 2022.
February 22, and our subsequent filings made with the SEC.
All cautionary statements, we make during the call should be understood as being applicable to any forward looking statements. We make wherever they may appear you should carefully consider the risks described in our reports and should not place any undue reliance on any forward looking statements. We assume no responsibility for updating any forward looking statements we refer to adjusted EBITDA. During this call are comp.
Probable GAAP measure and a reconciliation thereto are presented in our earnings release I'll now turn the call over to Hamid.
Thank you Dean.
Good day everyone.
Our agenda for the call today is as follows first who will provide a brief overview of financial activity from the first quarter.
After that we will discuss our business strategy, which includes the three parallel work streams that are called horizons.
And our progress on all three will then move to question and answer session.
Let's start with the financials.
Our revenue in the first quarter of 2023 was 440 million lower by $62 million compared to the same period of prior year.
The revenue decrease in the first quarter was partially driven by our consumer broadband business due to capacity constraints and other related factors as we wait for the in service our Jupiter three satellite.
We also had an anticipated decrease in our enterprise revenue, primarily due to lower domestic and international deployments and shipment timing for Q1.
As mentioned previously most enterprise orders are recognized over several years.
Which can create some variation in irregularity in a revenue stream, which is what occurred in the first quarter. However.
However.
We continue to generate momentum in this area of our business with $215 million of new orders booked in the first quarter.
Increasing 38% compared to the same period last year.
In our total enterprise backlog to $1 6 billion.
We are continuing to see success in our strategy to shift our efforts to opportunities within the enterprise market, which.
Which will continue to grow our backlog.
First diversify our business and provide sustained cash generation through low capital requirements.
And through greater operating leverage.
Our adjusted EBITDA in the first quarter was $135 million.
Decrease of 19% from last year, primarily driven by the lower revenue.
We continue to be disciplined on our cost structure in line with the change in revenue mix to sustain our cash generation performance.
Capital expenditures net of receipt of refunds in the quarter were $44 million.
Compared to $112 million in Q1 last year.
The decrease was primarily due to lower spend on the Jupiter three satellite program and.
In consumer premise equipment as well as $15 million of cash received from Max or the manufacturer of the Jupiter three satellite as part of our agreement with them related to the manufacturing delays.
Operating free cash flow defined as adjusted EBITDA minus capital expenditures was $91 million during the quarter $37 million higher than Q1 of last year.
We ended the quarter with $1 $7 billion of cash and marketable securities.
This balance excludes an additional $148 million of debt repayment proceeds received in early April .
I remain confident about the strength of our balance sheet as it affords us the flexibility to.
To explore investment opportunities.
Let me now I'll turn the call over to Paul who will provide some additional specifics on the quarter and our horizon, one and two activities.
Thank you for me as a reminder.
Cinder horizon, one is our near term priority to maximize our current services and operations, while managing costs as we prepare for the launch of Jupiter three Echostar 24 satellite.
To that end, we continue to focus on operational efficiencies and yield optimization of our North America satellite capacity in.
In the first quarter of 2023, we again updated our Hughesnet service plans to improve customer experience and upgrade subscribers to higher value plans.
The changes in our service plans have continued to build on our strategy of creating a natural shift to higher capacity higher price plans for our consumers improving our foods, while delivering an enhanced customer experience.
We also remain focused on improving our cost structure through additional automation and improve processes.
The market continues to react positively to our Hughesnet fusion plans, a considerable percentage of our new subscribers select fusion plans, which generate some of our highest arcos.
The plans have been well received by existing and new subscribers and we expect fusion to continue attracting new customers and helping reduce churn while improving arco.
We believe the combination of our enhanced Hughes net in Houston that fusion plans will help us combat the ongoing competitive pressures in our industry.
Moving forward to our North America Enterprise business, we continue to expand our managed services footprint, and notably announced that we completed the rollout of the vitamin Shoppe secure SD Wan network at their 700 plus retail outlets.
We are also pleased to be recognized by Fortinet as their SD Wan partner of the year.
We had a strong quarter for orders in the retail petroleum segment and completed the deployment of two network upgrades that were awarded last year.
And our web program, we continued deliveries of production gateways and systems as planned and expect to complete all the gateways in 2023 scheduled.
As of the end of the first quarter of 2023, we have produced and shipped more than 16000 subscriber satellite subscriber core modules for inclusion in one way of user terminals.
We are also seeing significant interest in our Hughes Leo terminal, which includes our electronically steered antenna and we are very pleased to have been awarded another large contract from a customer for a version of this terminal we.
We will begin deliveries of terminal products. Later this year also enabling sales of our managed Leo services to the enterprise and government markets featuring one web connectivity.
In our defense and government systems Division, we secured numerous numerous service renewables, including follow on orders from Boeing for Pts.
The Navy for additional work on <unk> and one of our digital signage products for the social Security administration.
We are pleased to participate in the ribbon cutting ceremony for our Standalone open ran secure fiber network deployment at wouldn't be island Naval Air station in Washington State on March 30th.
Which helped demonstrate the potential of <unk> services in Dod applications, we look forward to growing our <unk> capability of Whidbey Island Naval Air station as well as on other Dod installations in the near future.
Now to our international operations, we continue to allocate satellite capacity to address various enterprise applications in Latin America.
As one Great example of this effort, we announced a project with Star group to provide cellular backhaul services to hundreds of locations in Mexico.
In other parts of Latin America, we continue to develop enterprise opportunities and are running pilots with several operators.
As for our Hughesnet service in Latin America, we remain focused on adding high value subscribers, which is lowering churn and optimizing the yield in our existing Latin American capacity.
In Brazil, we won a significant expansion of 800 vehicles for our fleet automation customer in India. We received an initial order for cellular backhaul services in support of the operator's Universal service obligation services.
And we were recognized in India by the economic times as best managed service provider a prestigious recognition of the role Hughes plays in the Indian market.
In terms of Jupiter the Jupiter system equipment sales, we continue to win orders around the world. This includes a significant number of remote terminals for deployment on the Euro set connect VHF satellite. Additionally, as we announced <unk> selected the Jupiter system to enable broadband services on EMEA set <unk> satellite.
Which will be help connect the unconnected across Malaysia.
And we announced that using SaaS chose the Jupiter system to help bridge, the digital divide and use Pakistan.
Now let me focus on horizon. Two activities. These include our efforts to bring Jupiter three into service for expansion of our offerings in North and South America, as well as growing and diversifying our global enterprise business.
I am pleased to report that the Jupiter three satellite is in the final stages of Assembly.
<unk> continues to work diligently and expects to complete the ship and shipped to satellite to the launch site and Jim we.
We are coordinating with Spacex to schedule the launch of Jupiter three at the first window that Spacex can allocate to kit.
Which is subject to preemption by certain.
Higher priority government launches once launched Jupiter three we'll deliver new broadband service in North and South America and quickly allow us to focus on growth by addressing the continued demand for high speed broadband throughout the region.
In preparation for the launch of Jupiter three the team is focused on developing service plans with higher speeds and more data along with higher speed Hughesnet fusion plans, creating the ultimate high speed low latency satellite internet experience to rival any Leo satellite Internet service. We believe the market is eager for these robust offerings and we plan to have a highly competitive suite of service.
<unk> to meet a variety of our customers' needs.
Horizon. Two also has a strong focus on expanding our global enterprise business, including the government sector.
We plan to leverage our managed services portfolio hybrid Leo Geo business solutions, and our manufactured products to pursue growth.
Nascent signs of horizon, two direction can be seen in the large enterprise orders in <unk> activities reported here today increased participation in this vast market segment is a key element of our diversification strategy as is improving our operational scale through potential small acquisitions, which we continue to explore now.
Now, let me turn it the call back over to Hamid.
Thank you Paul that was a good summary of our horizon, one and two activities from the first quarter of this year.
I want to reiterate that while we are in horizon one.
We are working on our other work streams horizon, two and three in parallel and to that end, we've had a busy quarter. Let me now focus on horizon, three and our longer term strategy to expand into new markets through both organic innovation as well as potential acquisitions.
While we continue to evolve acquisition opportunities.
We are also.
Evolving our <unk> prospects.
As we announced during the first quarter, we have begun construction of what we are calling the echostar light our constellation of 2008 Leo satellites.
Moving quickly to launch the first of these satellites to begin offering this store and forward in Internet of things machine to machine and other data services is starting in 2024.
At the same time, we are pursuing many avenues of exploration for our global spend assets for instance, we continue to bring on new customers in Europe for our Echostar mobile.
Lora enabled Iot service and we have recently demonstrated our direct to smartphone capabilities.
Europe , using NTN Iot over our Echostar 21 satellite.
We are testing similar services in North American markets using to dish network satellites, and we are actively working to expand our services into additional global markets.
With what we're learning from these deployments, we continue to refine our plans for bringing the lyra constellation to market.
These activities are not the only business development initiatives, we have undertaken in service of bringing our global <unk> network. We continue to actively engage with companies across the <unk> ecosystem.
To leverage the opportunities of the three GPP released 17 in developing a truly global <unk> non terrestrial network for real anytime anywhere device connectivity it is ubiquitous and transparent.
Let me now turn it over to the operator to start the Q&A session.
If you'd like to ask a question at this time. Please press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
Our first question comes from the line of Ric Prentiss with Raymond James.
Yes. Good morning, everybody can you hear me okay.
Yes, yes, okay. Thanks.
Hey, I wanted to start with obviously EBIT came in a little better than we were looking for and one of the areas that we noticed as cost of service seems a little light year over year and quarter over quarter were there any one time benefits impulses totals and associated with that when should we think about costs coming in ahead of the J three launch that might cause cost.
Serves to go up to a new level.
Well I guess first off what I think you can see there is there has been a focus on cost.
Cost savings efficient spend and.
And Thats true in the operation of the systems as well as <unk>.
Trying to be more efficient with how we spend our sales and marketing dollars. So.
So across those two elements the primary pickup for the quarter.
That's we believe that's a continuing trend till we get to the Jupiter three satellite.
Okay, and when you get to Jupiter, three or how should we think about incremental cost levels to kind of layer in that new infrastructure and support costs.
Well two things one we already have ingest did a lot of the cost since.
Ground network has been in place now for over a quarter. So you kind of see that already in the cost where we'll see additional spend will be in sales and marketing as we ramp up subscribers.
And you would expect it's the same sort of growth you might see from the previous satellite launches.
Okay.
I'm glad you finally have actually getting ready to ship in June it sounds like.
How should we think about how long from launch to in service will it take and is there any indication from Spacex on where in the manifest you might be possibly says we monitor the <unk> going up.
Well in terms of the actual.
<unk> service, we expect that in the fourth quarter and it would depend on exactly when we get the satellite in place and so on but we would expect to be in full service in the fourth quarter.
At the moment Rick at the moment, we are in August is scheduled for launch at a stage six as.
June shipments.
Our satellite will remain at this basic site currently we are in a manifest for an August time timeline.
<unk>.
As Paul mentioned previously.
There's not that many launch.
Systems in the World right now other than Spacex some of the military and government projects as they call Dx and deal projects take precedence.
We know so far with all of those projects we are still.
And is scheduled for August .
Okay. Good.
Alps.
Last one for me.
Obviously <unk> one hopefully almost done and then as you look for horizon, two and service in the fourth quarter.
How should we think about.
Horizon, three you gave us some color there.
Some of the direct to smartphone doing demos in Europe , and the us, but I would just think about the opportunity unfolding and will you can publicly kind of help us see the roadmap, particularly in that direction device space, which seems to be quite fast, but it might take some time.
Yes, so I'll focus on that one well before our focus on our lesson.
<unk> band opportunity is not the only thing we're working on horizon III.
<unk> seen how actively and aggressively we are pursuing enterprise business.
Our backlog is growing at an incredible pace and we expect that to continue so a horizon III.
As very promising for us in the enterprise sector, and so I'll leave that for now on our side.
Coming back to the S band and directed device we.
We couldnt be busier.
Sure.
We have already.
Mentioned, the Lyra constellation, which will give us a global coverage using the S band of global coverage.
Iot services.
Direct to non smartphone, but other devices and we see a lot of demand for that and this is something as a result of our early trials in Europe last year, using our geo satellites, but.
And we are in the design phase.
In design and engineering phase of a larger system, which we expect to come into service just a couple of years later after later we.
We have not disclosed the exact timing for that and exact specifics of that simply because that is still in development and some of the strategic to our business. We don't want to disclose that until we have secured additional gains before we come to market with additional information, but you should expect that.
In the second half of this decade, we will have.
<unk>, what we call Wideband service.
Just on a new constellation much larger constellation.
That.
That we were working on.
As time goes on and hopefully not too distant future, we will disclose all the details of that but.
We are not able to do it today.
Makes sense, thanks, a lot stay logos.
Thanks.
Our next question comes from Michael Rollins with Citi.
Thanks, and good morning, I'm curious to explore.
The ways in which.
Echostar is working with dish currently I think you mentioned in one of the five open ran.
Samples, where you may be working with dish and the filings for both companies still refers to the possibility.
Additional opportunities to work together and I'm, just kind of curious what the range of possibilities that could include.
And specifically could that include co investment opportunities as well as merger scenarios between the two companies. Thanks.
Look our relationship with dish is very collaborative we obviously have an arm's length relationship with the company.
Youre, both publicly traded stocks in.
We highly guard debt.
That aspect of the relationship to make sure we are.
Obviously protecting shareholders.
Best interest, having said that we find ourselves.
Hi.
A number of cases and opportunities.
Mutual beneficial situations so.
I think we have a number of areas, where we can collaborate so we highlighted a couple of those RF spectrum filings around the world are very complimentary for there in terms of the S band of spectrum. So.
We have satellite S band coverage over Europe , they have stopped like S band coverage over United States and Canada.
And North America, essentially and so to the degree that we can prove a service in Europe , we can.
Collaborate with dish and we have not disclosed all the details of.
The agreements at some of the agreements are preliminary and it has been limited to a small type services, but.
But as we are our aspirations are growing in terms of our.
S band offerings will put in place.
Oral agreements with dish.
For the use of their assets and.
Potentially.
Work with them on.
<unk> core network capabilities, where we probably do not want to build in house at Echostar.
They have the only pure <unk> in the World and also is available unused underutilized I think thats something that we can.
In an outsourced fashion with them, we are not at a point where.
Those agreements are necessary yet but.
But we will in due time, we'll disclose any related party transaction related.
Those activities.
The <unk> with the island.
Has been just the we've used.
Dish is a sub two two or.
So our program. So we've had a number of subcontractors and service providers, whether it be Cisco, whether it be dish, whether it be some of the others that we have worked with US it is a number of.
Pes providers that we have kind of brought together as a complete solution to the navy and for the time being and going forward our relationship with dish will remaining the same.
Same construct as there is no reason to.
For us to consider any other alternative at the moment.
We're not looking for joint acquisitions with dish and Thats not.
<unk>.
Not.
Working on any.
Yeah.
As we said in horizon, three we're looking to acquire companies.
If you're asking us whether we are co investing in companies where not to invest in companies with dish, It's Julian Echostar activity.
Thanks, and just one follow up on on Horizon, three what are the things.
That investors should be looking out for.
That could accelerate the timetable in which.
The investment case, and maybe even some of the return opportunities become more.
The ball and tangible.
<unk>.
Quantifying what that would represent for echostar.
So for Echostar to things that we.
Can point you to one is the.
As we go forward, we will report our enterprise backlog.
And these are booked committed contracts. These are not just funnel activities. These are either so.
And I think you should keep a close eye on that and as we will report our progress on a quarterly basis and as you look at that you could see the trend of revenue in the future. I mean this is this is different than a consumer consumer has the disadvantage that you really don't know the trend.
And in a very long horizon, but an enterprise you actually see that one of the advantage of the enterprise business is that he can grow in very large chunks for instance, if there is a as possible.
Within a year Steiner and were within the quarter signed the $5 billion enterprise over there, but how long does it take to get to $5 billion of consumer revenue right. I mean, so enterprise can grow.
Very very large and very quick steps. So first of all we encourage you to take a look at our backlog and carefully examine that because.
That shows that the trend a few years down the road will be how much of our business. He is going to be enterprise revenue.
And how much of it is when a consumer we're not putting any projections today, but be giving you. Some of the one of the biggest drivers which is the backlog.
Is the biggest proof of their future benefits and.
And we try to be more precise with that as we go forward. We tried to give you even more timing as we.
Finding that useful to you and ourselves will certainly we'll disclose more of that potentially second half of this year beginning of next year.
So thats one the second one is as it comes to the S band development.
<unk>.
Look one of the most the timing in this industry as you are well aware to develop satellite systems.
Take several years and so that's.
That's why we call. These horizon three you should start seeing as of 26 2726 27.
The biggest impacts potentially first impacts are shown up and this is not just because of the satellites, but also please think debt.
To provide directed device fluor devices that are <unk> compliant immune release 17, three GPP compliance with directed satellite those devices. The chipsets are just beginning to be manufactured starting now that will take a year and a half cycle for the chipsets to be ready and it takes another year for the chipsets to get.
The phones.
So phones get out the market and on the very first day with the phones are introduced.
Not too many phones I mean.
That very day.
This small number of phones and release right for that base to grow it takes another year. So when you add that up you're talking about a four year window three year window from here two to four year window and Thats exactly the same window that the satellites will take to be prepared. These are these are opponents of satellites.
Large sizes to be produced in.
So as I said this is this will be vastly impactful in the second half of this decade, I would say starting with 27 timeline you should expect to see very material meaningful revenues from that from there forward that debt, but that is only related to the big five the big <unk>.
In between we have the <unk>.
Lyra constellation, which is a 24, which is just next year in 12 months from now potentially in 18 months from now we will be generating revenues.
From that system.
In between while we get to the to the largest system I hope that gives you a bit of a.
Our roadmap for where we think the revenues will fall and we hope to give you more information again potentially.
End of this year beginning of next year as we solidify our segment reporting as some of these plans.
That's helpful. Thank you.
Okay.
As a reminder to ask a question that is star one one.
Our next question comes from Chris Quilty with Quilty space.
Hi can you hear me.
Barely but yes.
Oh, Okay, sorry about that so how many satellites as the new constellation going to have just kidding.
I had to at least ask.
No I actually wanted to follow up on something you were saying about the backlog.
And more specifically can you give us a sense I mean, obviously.
Enterprise in general, but is there a specific area where youre seeing this.
Strongest growth in that backlog, whether it be the.
<unk> side is it retail is it oil and gas any color in that direction.
Okay.
I don't know if I can be disclosing that I think we're seeing growth in a number of areas, including areas and segments that we have not had a historical business.
And I think in hopefully not too distant future maybe needed during the course of the next couple of quarters.
We will give you more.
More specifics on that our enterprise business is growing in a number of directions and we are.
Primarily focusing on.
Obviously, you're focusing on our highest margin highest profitability segments. We are we have vastly.
De prioritizing in fact discontinued anything that had low margins lower margin. So.
Don't look at our enterprise businesses.
As compared to some of the undifferentiated enterprise businesses ours includes.
Hi expertise a lot of manufacturing of our own products solutions that we create and unique IP involved in some of those so.
We are very excited about.
Enterprise business again, lower capital requirement vastly lower capital requirements and that in very large size orders coming.
I think for now we are not yet.
In position for competitive reasons, we are not yet in position to to kind of dissect the new business that we're getting but you should assume that.
It involves some groundbreaking new areas, where we have not done business before.
Great.
Maybe turning in a different direction.
Can you give us your sense of what you are seeing regionally in terms of demand in different parts of the world.
And perhaps maybe a little bit higher level thought on what you are seeing obviously, good backlog and good orders, but in terms of the economic environment and the demand from your customers.
Sure well I guess sort of generically.
If you look let's start with South America, we sort of mentioned the cellular backhaul world, we're seeing a lot of projects for connecting the unconnected. So thats a very active market.
That theme continues pretty much across most of the rest of the world except for <unk>.
Western Europe .
So that's a pretty strong theme both the unconnected.
Aspect as well as the cellular backhaul aspect.
We are seeing.
Growth in the broadband where you have direct terminals to homes and schools and so on and that that.
We talked about the EMEA SAP project, we obviously have a lot of activity in other places like Indonesia.
<unk> certainly is the case in point and then in Western Europe Eutelsat is actively deploying broadband. So so we have a whole series of these broadband projects all the way from end users up to schools and communities.
In North America, as a whole series of industrial projects, a lot of connectivity where in North America. The object is to have more than one path.
To the broadband services most of the of the corporations and users can afford to be down anymore, especially with cloud services. So so we see a lot of activity in that space.
Great.
Also you talked about the fusion.
Service offering can you give us any sense of how quickly that that product line is growing.
Maybe even.
Percent of the installed base or some other metric that might be useful and what sort of impact are you seeing on those plans in terms of the monthly arm.
Yes, I guess two parts one I think we can in future.
Quarters give you a little more background, we haven't completed our rollout across the U S. Yet so I think once we have that we can give you a better sense of it.
And then I think.
As we as we look forward.
If you look at our service plans I think you can see the base pricing is that there is a $99 plan. So so certainly that's skip above most of the plans we sell today and the Geo service. So so we would expect some combination of blending of customers buying that kind of a plan as well as our standard Goto plans, which are.
Our lower priced.
Great.
There was a mention on Capex.
Obviously, one of the $15 million receivable from Max or can you just remind us are there any additional payments that you expect throughout the course of this year.
Yes.
Yes, we expect that the second quarter will continue to receive payments and have disclosed that in their filing so our payments will continue at the same pace through.
End of June and if for any reason, which we don't anticipating at the moment.
The satellite.
Deliveries further delayed there'll be to be additional payments beyond June , but we're not expecting that.
Okay.
So there will be.
There'll be another $30 million of additional payments.
$15 million $15 million for the quarter $15 million over the next quarter.
Okay.
Also the <unk>.
Sure.
And electronically steered antenna that aviation antenna it sounds like you've gotten.
Surprisingly good traction there haven't been that many announcements of aviation installs.
Can you give us a sense of what your expectations are for that product line and how broadly you're shopping that and for no other airline customers.
Well certainly.
One of the attributes of the aviation World as it's quite a rigorous certification process. So.
So actual antennas that go on aircraft will be delayed until we complete that process, but we think what we've done is is technologically quite sophisticated.
It provides a lot of.
I think.
Very good benefits to an airline that might consider it.
So we hope that as time goes on we'll see.
See pickup of that.
I think the main thing we've announced is of course, the antenna, we're going to be supplying to Gogo business aviation.
Which is a nice fit for for that kind of an aircraft. So so I think we will continue to get that developed and get it approved.
Approved and out to market and then at which point, we'll be able to see how big an opportunity. It is.
Great and final question I think you mentioned.
That you had shipped 16000 core modules for integration into one web terminals remind me youre not assembling the terminal that someone else here just shipping the core module.
And second question since one web products are now shipping are you guys seeing any activity in your Indian operations.
Okay on the first.
Part.
So the industrial structure that was created was we build the core module, which any any partner of <unk> can use them in whatever aspect of a terminal or a set of services they might create so so we're just in enabling component.
And so in that respect we ship these out to various partners and their partners than.
Make use of them in their applications.
And as far as.
India, I think mainly deferred to one web to describe there.
Plans, there obviously, we standby ready once the services are lit up but they can I think speak more to that.
Alright, great. Thank you very much gentlemen.
Our next question comes from the line of Ric Prentiss with Raymond James.
Yes.
At the time, we got for a few more follow ups I won't fall back up on one of Michael's questions.
I think your answer alluded to it but.
What are any circumstances, where it makes sense.
For Echostar shareholders for dish and Echostar to recombine is there any potential out there scenario that says that should happens even.
A thought.
That is not a topic that.
We have contemplated and we can discuss here in the call. We do have as I mentioned earlier, we're not limited.
<unk>.
With respect to any opportunities in the existing situation, we have with dish. So we have a great working relationship with them.
We've not had any issues with respect to.
The company is not being able to come to at arm's length agreement on any aspect of the opportunities.
That said, we find ourselves in a number of cases, where this mutually beneficial opportunities that seem to have somewhat of a complementary assets to us in many ways, but we have not had any.
Any limitations on being able to put those two assets classes of assets to using an opportunity. So we're not we're not hampered by anything at the moment.
Okay.
And to follow up on some of <unk> questions. Obviously, some concern about global economy out there potential recessions enterprise what are you seeing as far as enterprise. It obviously in the backlog can speak for itself, but any concerns you are hearing from the customer base about economic concerns are purchase orders or timing and trends.
Well I think nothing specific obviously the customers we've talked to are in different positions, depending on what part of the world they're in.
There are certainly some concerns, especially with enterprise customers, but we do we do.
Do see them proceeding to make decisions, perhaps a little bit slower in some cases, but they are proceeding so we're not seeing yet.
<unk>.
Forecasted effect that people feel is out there in the market.
And.
Sure.
I want to also say that at the moment, we're not seeing we're not exposing ourselves in any sort of.
Any material or meaningful way to bad debt.
Our business our enterprise business.
It stands on solid credit ground, we're not.
Using our balance sheet to.
Float or the enterprise businesses.
And some of our manufacturing activities, we actually get paid beforehand.
Equipment and materials. So we are in.
We are not exposed to bad debt in any material way.
In the enterprise business.
Okay, and then last one for me.
Any update on the CFO search as far as.
Candidates timing when we could expect someone joining the team.
Alright, Joe Joe, Yes, joking with my teammates and I love to jump so much myself that I, just I might as well not net never fill it but.
But kidding aside.
The nature of our business has been first of all we've been very busy interviewing a number of candidates I have not I have a complete team now and I'm happy with everybody that I have on my team. So we're not in any way.
It can assured of leadership here and see if it was the only open position that I have that that debt is still open I have been Kennedy part of it has been.
My own schedule, and just lining things up getting the right candidate, but part of it is that as the nature of our business has been changing we doing this shifting towards.
Enterprise, taking a look at the S band and others have been very picky about the profile, that's changing continuously changing and Jonathan <unk>, who is the right person to join us.
But I do expect that.
This will not take hopefully too much longer.
But I wanted to say that as you've seen from our results from our ability to focus on.
Harper financials in developing the business that we are not in any way.
Limited by lack of a sitting CFO .
Great. Thanks for the follow up questions have a government.
Yes.
That concludes today's question and answer session I would like to turn the call back to Dean Manson for closing remarks.
Okay, well. Thank you Liz I think we're ready to bring the meeting to a close thank you everyone for calling in.
Thank you Jim.
This concludes today's conference call.
Thank you for participating you may now disconnect.
Okay.
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