Q2 2024 Cambium Networks Corp Earnings Call

August 8, 2024

Stephen: Good afternoon. My name is Stephen and I'll be your conference operator today. At this time, I would like to welcome everyone to the Cambium Networks second quarter 2024 financial results conference call.

Operator: At this time, I would like to welcome everyone to the Cambium Networks' second quarter 2024 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. As a reminder, this call is being recorded. To ask a question during the session, you will need to press Star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press Star 1-1 again. Please limit yourself to one question and one follow-up question. Thank you.

Operator: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. As a reminder, this call is being recorded. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised.

Stephen: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session.

Stephen: As a reminder, this call is being recorded. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again.

Stephen: Please limit yourself to one question and one follow-up question.

Peter Schuman: Mr. Peter Schuman, Vice President of Investor, Industry, Analyst, and Public Relations, you may begin your conference.

Operator: To withdraw your question, please press star one once again. Please limit yourself to one question and one follow-up question. Thank you. Mr. Peter Schuman, Vice President of Investor, Industry Analyst, and Public Relations. You may begin your conference. Thank you, Stephen.

Stephen: Thank you.

Speaker Change: Mr. Peter Schuman, Vice President of Investor, Industry Analyst, and Public Relations, you may begin your conference.

Peter Schuman: Thank you, Stephen. Welcome and thank you for joining us today for Cambium Network's second quarter 2024 financial results conference call, and welcome to all those joining by webcast. Morgan Kurk, our President and CEO, and Jacob Sayer, our CFO, are here for today's call. The financial results press release and commentary referenced in this call are accessible on the investor page of our website, and the press release has been submitted on a Form 8K with the SEC.

Peter Schuman: Thank you, Steven. Welcome and thank you for joining us today for Cambium Networks' second quarter 2024 financial results conference call and welcome to all those joining by webcasts. Working Kirk, our President and CEO, and Jacob Sayer, our CFO, are here for today's call. The financial results press release and commentary referenced on this call are accessible on the investor page of our website, and the press release has been submitted on a Form 8-K with the SEC. A copy of today's prepared remarks will also be available on our investor page at the conclusion of this call.

Speaker Change: Morgan Kurk, our President and CEO , and Jacob Sayer, our CFO , are here for today's call. The financial results, press release, and commentary referenced on this call are accessible on the investor page of our website, and the press release has been submitted on a Form 8K with the SEC.

Peter Schuman: A copy of today's prepared remarks will also be available on our investor page at the conclusion of this call. As a reminder, today's remarks, including those made during Q&A, will contain forward-looking statements about the company's outlook and forecasted performance. These statements are based on current conditions, forecasts, and assumptions; risks and uncertainties could cause actual results to differ materially. Except as required by law, Cambium Networks does not undertake any obligation to update or revise any forward-looking statements for any reason after the date of this presentation, whether as a result of new information, future developments, to conform these statements to actual results, or to make changes in Cambium's expectations or otherwise. It is Cambium Networks' policy not to reiterate its financial outlook.

Speaker Change: A copy of today's prepared remarks will also be available on our investor page at the conclusion of this call. As a reminder, today's remarks, including those made during Q&A, will contain forward-looking statements about the company's outlook and forecasted performance. These statements are based on current conditions, forecasts, and assumptions.

Peter Schuman: As a reminder, today's remarks, including those majoring Q&A, will contain forward-lifting statements about the company's outlook and forecasted performance. These statements are based on current conditions, forecast, and assumptions. Risk and uncertainty could cause actual results to differ materially. Except as required by law, Cambium Networks does not undertake any obligations to update or revise any forward-looking statements for any reason after the date of this presentation, whether as a result of new information, future developments, to conform these statements to actual results or to make changes in Cambium's expectations or otherwise.

Speaker Change: Risk and uncertainties could cause actual results to differ materially.

Speaker Change: Except as required by law, Cambium Networks does not undertake any obligation to update or revise any forward-looking statements for any reason after the date of this presentation

Speaker Change: whether as a result of new information, future developments, to conform these statements to actual results, or to make changes in Cambium's expectations or otherwise.

Peter Schuman: It is Cambium Networks' policy not to reiterate our financial outlook. We encourage listeners to review the full list of risk factors included in the State Harper statement in today's financial results press release for most recent SEC filings, including our most recent Form 10-K and Form 10-Qs. We will also reference both GAP and non-GAP financial measures and specifically note that all sequential and year-over-year comparisons reference non-GAP numbers, except for otherwise noted. A reconciliation of non-GAAP measures to GAAP is included in the appendix to today's financial results press release, which can be found on the investor page of our website, and it's today's press release announcing our results.

Peter Schuman: We encourage listeners to review the full list of risk factors included in the Safe Harbor Statement and today's financial results press release or our most recent SEC filings, including our most recent Form 10-K and Form 10-Q. We will also reference both GAAP and non-GAAP financial measures and specifically note that all sequential and year-over-year comparisons reference non-GAAP numbers except as otherwise noted. A reconciliation of non-GAAP measures to GAAP is included in the appendix to today's financial results press release, found on the investor page of our website, and in today's press release announcing our results.

Speaker Change: It is Cambium Networks' policy not to reiterate our financial outlook. We encourage listeners to review the full list of risk factors included in the Safe Harbor Statement and today's financial results press release for our most recent SEC filings, including our most recent Form 10-K and Form 10-Q s.

Speaker Change: We will also reference both GAAP and non-GAAP financial measures and specifically note that all sequential and year-over-year comparisons reference non-GAAP numbers except for otherwise noted. A reconciliation of non-GAAP measures to GAAP is included in the appendix to today's financial results press release.

Peter Schuman: Turning to the agenda, Morgan will provide the key operational highlights for the second quarter 2024, and Jacob will provide a recap of the financial results for the second quarter 2024, and we'll discuss our financial outlook for the third quarter and full year 2024. Our prepared remarks will be followed by a Q&A. I'd now like to turn the call over to Morgan.

Peter Schuman: Turning to the agenda, Morgan will provide the key operational highlights for the second quarter 2024, and Jacob will provide a recap of the financial results for the second quarter 2024 and will discuss our financial outlook for the third quarter in full year 2024. Our prepared room remarks will be followed by a Q&A session.

Speaker Change: which can be found on the investor page of our website, and in today's press release announcing our results.

Speaker Change: Turning to the agenda, Morgan will provide the key operational highlights for the second quarter 2024, and Jacob will provide a recap of the financial results for the second quarter 2024, and we'll discuss our financial outlook for the third quarter and full year 2024.

Morgan Kurk: I now like to turn the call over to Morgan.

Morgan Kurk: Summary of the performance of Q2-24. Revenues for Q2'24 were $45.9 million. We are pleased revenues were just above the midpoint of the outlook we provided during our Q1-24 financial results call, with revenues up sequentially by 9% due to continued growth in our enterprise business, with higher revenues in all geographies and growth in our point-to-multipoint PMP business. Adjusted gross margin improved again quarter over quarter, although it was muted by higher than expected reserves taken for excess finished goods and raw materials.

Speaker Change: Our prepared remarks will be followed by a Q&A session.

Morgan Kurk: Thank you, Peter. Summarizing performance of Q2-24. Revenues for Q2-24 were $45.9 million. We are pleased revenues were just above the midpoint of the outlook we provided during our Q1-24 financial results call. With revenues ups sequentially by 9% due to continued growth in our enterprise business, with higher revenues in all geographies and growth in our point-to-multi-point PMP. Business. Adjusted Gross Margin improved, again, quarter to quarter, used by higher than expected reserves, taken for excess finished goods and raw materials. Excluding the unexpected ENO charges, adjusted gross margins would have been 44.4% above our guidance for the quarter.

Morgan Kurk: Excluding the unexpected E&O charges, adjusted gross margins would have been 44.4%, above our guidance for the quarter. Operating margins improved sequentially as we continue to control expenses to lower our break-even price. Free cash flow was negative $1.8 million during Q2-24, and our cash balance stood at $42.6 million as of June 30.

Speaker Change: I'd now like to turn the call over to Morgan.

Morgan Kurk: Thank you, Peter.

Morgan Kurk: Summarizing the performance of Q2-24.

Jacob Sayer: Revenues for Q2'24 were $45.9 million.

Morgan Kurk: We are pleased revenues were just above the midpoint of the outlook we provided during our Q1-24 financial results call, with revenues up sequentially by 9% due to continued growth in our enterprise business,

Morgan Kurk: with higher revenues in all geographies and growth in our point-to-multipoint PMP business.

Jacob Sayer: Adjusted gross margin improved again quarter over quarter, muted by higher than expected reserves taken for excess finished goods and raw materials.

Jacob Sayer: excluding the unexpected E&O charges, adjusted gross margins would have been 44.4% above our guidance for the quarter.

Morgan Kurk: Operating margins improved sequentially as we continue to control expenses to lower our rate even point. Re-cash flow was negative $1.8 million during Q2-24, and our cash balance stood at $42.6 million as of June 30th. Cash flow from operations was positive $2.4 million. This is the first time it was positive in six quarters.

Jacob Sayer: Operating margins improved sequentially as we continue to control expenses to lower our break-even point.

Morgan Kurk: Free cash flow was negative $1.8 million during Q2-24, and our cash balance stood at $42.6 million as of June 30.

Morgan Kurk: Cash flow from operations was positive $2.4 million. This was the first time it was positive in six quarters. We believe the business is moving in the right direction financially, operationally, and strategically. Sales of Cambium's products out of the distribution channel as reported by Cambium's distributors were again higher for Q2, 24, and Cambium's reported revenues, and we saw corresponding to clients and channel inventory. We continue to make progress in cleaning channel inventories, and some of our partners are at appropriate levels of inventory, while other partners still have work to do.

Jacob Sayer: Cash flow from operations was positive 2.4 million dollars.

Morgan Kurk: We believe the business is moving in the right direction financially, operationally, and strategically. Sales of Cambium's products out of distribution channel, as reported by Cambium's distributors, were again higher for Q2-24, and Cambium's reported revenues, and we saw a corresponding decline in channel inventory. We continue to make progress in cleaning channel inventory, and some of our partners are at appropriate levels of inventory, while other partners still have work to do. Sales in and sales out are expected to be at equilibrium by the end of the year, which is slightly longer than we had previously thought. A shorter lead time and higher interest rates are driving distributors to a greater level of efficiency than in the past.

Jacob Sayer: This is the first time it was positive in six quarters.

Jacob Sayer: We believe the business is moving in the right direction financially, operationally, and strategically.

Jacob Sayer: Sales of Cambium's products out of distribution channel as reported by Cambium's distributors were again higher for Q2-24 than Cambium's reported revenues, and we saw corresponding declines in channel inventories.

Jacob Sayer: We continue to make progress in cleaning channel inventories, and some of our partners are at appropriate levels of inventory, while other partners still have work to do.

Morgan Kurk: Sales in and sales out are expected to be at equilibrium by the end of the year, which is slightly longer than we had previously thought, as shorter lead times and higher interest rates are driving distributors to a greater level of efficiency than in the past.

Speaker Change: Sales in and sales out are expected to be at equilibrium by the end of the year, which is slightly longer than we had previously thought, as shorter lead times and higher interest rates are driving distributors to a greater level of efficiency than in the past.

Morgan Kurk: Looking forward, lower channel inventories will result in end users' demands more directly driving increased revenues.

Morgan Kurk: Looking forward, lower channel inventories will result in end users' demand more directly driving increased revenue; looking at some customer wins that are key to our future success. In the U.S., CalNet, a provider of high-speed wireless broadband and digital services in the Central Valley and rural northern California, has deployed EPMP4600 to serve residential and commercial users with improved service levels of 400 megabits per second downlink and 200 megabits per second uplink. They're providing high-speed internet service to agricultural operations, local businesses, and residential customers, enabling increased productivity, improved video experience, and a whole host of other broadband services. They selected Cambium as their supplier due to our value proposition: reliable, high-performance service at an affordable cost. This, in turn, allows CalNet to provide faster broadband speeds at a lower cost to its customers than the incumbent service provider.

Speaker Change: Looking forward, lower channel inventories will result in end-users' demand more directly driving increased revenues.

Morgan Kurk: Looking at customer wins that are key to our future success. In the US, CalMAT, a provider of high-speed wireless broadband and digital services in the Central Valley and rural Northern California, has deployed EPMP 4600 to serve residential and commercial users with improved service levels of 400 megabits per second downlink and 200 megabits per second uplink. They're providing high-speed internet service to agricultural operation, local businesses, and residential customers, enabling increased productivity, improved video experience, and a whole host of other broadband services. A selected cambium is their supplier due to our value proposition. Reliable high-performance service at an affordable cost.

Jacob Sayer: Looking at some customer wins that are key to our future success.

Speaker Change: In the U.S., CalNet, a provider of high-speed wireless broadband and digital services,

Speaker Change: in the Central Valley and rural Northern California has deployed EPMP4600 to serve residential and commercial users with improved service levels of 400 megabits per second downlink and 200 megabits per second uplink.

Speaker Change: They're providing high-speed internet service to agricultural operations.

Speaker Change: local businesses, and residential customers, enabling increased productivity, improved video experience, and a whole host of other broadband services.

Speaker Change: They selected Cambium as their supplier due to our value proposition.

Morgan Kurk: This, in turn, allows CalMAT to provide faster broadband speeds at a lower cost to their customers than the incumbent service provider. In England, Bonayas, a rural broadband provider, is leveraging Cambium Networks, CNWade at 60 GHz mesh technology to bring improved connectivity to Wal-Me Island. Bonayas is deploying Cambium technology to make gigabit broadband available to more than 10,000 island residents. This collaboration aims to support the community's economic development and enhance educational opportunities for local students. Cambium was selected due to the speed with which the system can be deployed. This is enabled by leveraging existing physical infrastructure and combining with Cambium's mesh technology, which also reduces the total cost of ownership.

Speaker Change: Reliable, high-performance service at an affordable cost.

Speaker Change: This in turn allows CalNet to provide faster broadband speeds at a lower cost to their customers than the incumbent service providers.

Morgan Kurk: In England, Bonaeus, a rural broadband provider, is leveraging Cambium Networks' CMWave 60GHz mesh technology to bring improved connectivity to Whaleney Island. Bonaeus is deploying Cambium's technology to make gigabit broadband available to more than 10,000 island residents. This collaboration aims to support the community's economic development and enhance educational opportunities for local students.

Speaker Change: In England, Phonais, a rural broadband provider, is leveraging Cambium Networks.

Speaker Change: CM Wave 60 gigahertz mesh technology.

Speaker Change: to bring improved connectivity to Walnut Island. Bonaus is deploying Cambium's technology to make gigabit broadband available to more than 10,000 island residents.

Speaker Change: This collaboration aims to support the community's economic development and enhance educational opportunities for local students.

Morgan Kurk: Cambium was selected due to the speed at which the system can be deployed. This is enabled by leveraging existing physical infrastructure and combining it with Cambium's mesh technology, which also reduces the total cost of ownership. In addition, in the enterprise space, the Indian Institute of Technology, a premier public technical university located in Dhanbad, India.

Speaker Change: Tabby must select it due to the speed which the system can be deployed.

Speaker Change: This is enabled by leveraging existing physical infrastructure and combining it with Cambium's mesh technology, which also reduces the total cost of ownership.

Morgan Kurk: In addition, in the enterprise space, the Indian Institute of Technology, a premier public technical university located in Dunbot, India, selected Cambium's enterprise solutions to connect multiple academic housing blocks across the university's campus.

Speaker Change: In addition, in the enterprise space, the Indian Institute of Technology, a premier public technical university located in Dhanbad, India, selected Cambium's enterprise solutions to connect multiple academic and housing blocks across the university's campus.

Morgan Kurk: Selected Cambium's Enterprise Solution to connect multiple academic and housing blocks across the university's campus. Now let's turn to upcoming product introductions since our last previous quarterly. In June, we announced the release of a new PTP product for our commercial customers in the 80 GHz EVAM. PCP 850-ER. The product delivers 10 gigabit capacity and features a smaller form factor than prior product versions at a very compelling price. The eBend is ideal for building-to-building and other point-to-point connectivity as an alternative to fiber or as a backup to fiber and is used for applications such as backhauling outdoor Wi-Fi and video surveillance. Channel partners, we have introduced a new concierge program called Elite.

Morgan Kurk: Now let's turn to upcoming product introductions since our previous quarterly update. In June, we announced the release of a new PTP product for our commercial customers in the 80 gigahertz EVAM, the PTP 850EX. The product delivers 10 gigabit capacity and features a smaller form factor than prior product versions at a very compelling price. The EVAM's ideal for building to building another point to point connectivity as an alternative to fiber or as a backup to fiber and is used for applications such as back calling outdoor Wi-Fi and video surveillance.

Speaker Change: Now let's turn to upcoming product introductions since our previous quarterly update.

Speaker Change: In June , we announced the release of a new PTP product for our commercial customers in the 80 gigahertz EVAM, the PTP850EX.

Speaker Change: The product delivers 10 gigabit capacity and features a smaller form factor than prior product versions at a very compelling price.

Speaker Change: The eBand is ideal for building-to-building and other point-to-point connectivity as an alternative to fiber or as a backup to fiber, and is used for applications such as backhauling outdoor Wi-Fi and video surveillance.

Morgan Kurk: For channel partners, we have introduced a new concierge program called Elite. Managed Wi-Fi service providers, value-outed resellers, and system integrators are eligible for this select program. The enhanced program introduces a new partner level, offering a host of benefits designed to accelerate growth, reduce risk, and increase sales velocity. The program includes personalized support in the deployment of Cambium-1 solutions from a senior technical staff member assigned to the account as a consultant, an expertise from specialized technical staff for onboarding and customer engagement. Finally, total devices under CM Maestro Cloud Management in Q2-24 increased approximately 6% from Q1-24 and was up 15% year-over-year.

Speaker Change: For channel partners, we have introduced a new concierge program called Elite.

Morgan Kurk: Managed Wi-Fi Service Providers, Value Added Resellers, and System Integrators are eligible for this select program. The Enhanced Program introduces a new partner level, offering a host of benefits designed to accelerate growth, reduce risk, and increase sales velocity. These benefits include Personalized support in the deployment of Cambium One solutions from a senior technical staff member assigned to the account as a consultant, and expertise from specialized technical staff for onboarding and customer engagement. Finally, total devices under CM Maestro Cloud Management in Q2-24 increased approximately 6% from Q1-24 and was up 15% year over year. I will now turn the call over to Jacob for a review of our Q2-24 financial results and Q3-24 and full year 2024 financial outlook.

Speaker Change: Management Wi-Fi service providers, value-out-of-resellers and system integrators are eligible for this select program.

Speaker Change: The Enhanced Program introduces a new partner level offering a host of benefits designed to accelerate growth, reduce risk, and increase sales velocity.

Speaker Change: The program includes personalized support in the deployment of Cambium One solutions from a senior technical staff member assigned to the account as a consultant.

Speaker Change: and expertise from specialized technical staff for onboarding and customer engagement.

Speaker Change: Finally, total devices under CM Maestro Cloud Management in Q2-24 increased approximately 6% from Q1-24 and was up 15% year over year.

Jacob Sayer: I will now turn the call over to Jacob for a review of our Q2-24 financial results and Q3-24 in full-year 2024 financial outlook.

Speaker Change: I will now turn the call over to Jacob for a view of our Q224 financial results and Q324 and fully year 2024 financial out.

Jacob Sayer: Thank you, Marvin. Q2-24 top-line results of $45.9 million increased 9% from Q1 due to growth in our enterprise and PMD businesses. Q2-result included additional inventory charges, flyer commitment, and reserves which impact across margins by approximately $7 million, which was $5 million more than we expected at the beginning of the quarter.

Jacob Sayer: Thank you, Morgan. Q2-24 top-line results of $45.9 million increased 9% from Q1 due to growth in our enterprise and PMP business. Q2's result included additional inventory charges and supplier commitment reserves, which impacted gross margins by approximately $7 million, which was $5 million more than we expected at the beginning of the quarter. Had E&O been in line with expectations, non-gap gross margins would have been approximately 44.4%, slightly better than expectations due to stronger enterprise sales. We continue to work hard to manage our operating costs, focusing resources on those products and projects that are most critical to Cambium's future success.

Jacob Sayer: Thank you, Morgan. Q2-24 top-line results of $45.9 million increased 9% from Q1 due to growth in our enterprise and PMP businesses.

Jacob Sayer: Q2 results included additional inventory charges and supplier commitment reserves, which impacted gross margins by approximately $7 million.

Jacob Sayer: How do you know that, in line with expectations, non-GAAP growth margins would have been approximately 44.4%, slightly better than expectations due to stronger enterprise sales. We continue to work hard to manage our operating costs, focusing resources on those products and projects that are most critical for Cambium's future success.

Jacob Sayer: which was $5 million more than we expected at the beginning of the quarter.

Speaker Change: Had E&O been in line with expectations, non-gap gross margins would have been approximately 44.4%, slightly better than expectations due to stronger enterprise sales.

Speaker Change: We continue to work hard to manage our operating costs, focusing resources on those products and projects that are most critical for Cambium's future success.

Jacob Sayer: Turning to revenue in the quarter. The increased revenue was mostly due to growth in the enterprise business, which grew 58% sequentially, as demand improved in all geographies and channels; inventories continued to decline. Our PMP business grew slightly at 1% sequentially, thanks to strengths in our EPMP product lines in Europe and Asia Pacific. Our North America PMP business remains slow as service riders are still working to understand the nuances of the six gigahertz PMP solution before moving to volume deployments. The point-to-point business declined by 5% sequentially due to the completion of a large North American licensed microwave installation in the prior quarter in Q1, partially offset by increased defense orders in Europe.

Jacob Sayer: Turning to revenue in the quarter, the increase in revenue was mostly due to growth in the enterprise business, which grew 58% sequentially as demand improved in all geographies and channel inventories continued to decline. Our PMP business grew slightly, up 1% sequentially, thanks to strength in our e-PMP product lines in Europe and Asia Pacific. In North America, however, PMP business remains slow as service riders are still working to understand the nuances of the six gigahertz PMP solution before moving to volume.

Speaker Change: Turning to revenue in the quarter. The increase in revenue was mostly due to growth in the enterprise business which grew 58% sequentially as demand improved in all geographies and channel inventories continues to decline.

Speaker Change: Our PMP business grew slightly, up 1% sequentially, thanks to strengths in our e-PMP product lines in Europe and Asia-Pacific.

Speaker Change: Our North America PMP business remains slow as service providers are still working to understand the nuances of a 6 GHz PMP solution before moving to volume deployments.

Jacob Sayer: The point-to-point business declined by 5% sequentially due to the completion of a large North American licensed microwave installation in the prior quarter in Q1, partially offset by increased defense orders in Europe. While we typically expect Defense to grow with historical trends during the second half of the year, this year we're seeing a delay in projects due to budget prioritization both for domestic and international defense projects. Looking at it by region.

Speaker Change: The point-to-point business declined by 5% sequentially due to the completion of a large North American licensed microwave installation in the prior quarter in Q1.

Jacob Sayer: While we typically expect defense to grow with historical trends during the second half of the year, this year we're seeing a delay in broad. due to budget prioritization, both for domestic and international defense projects. So looking at it by region, EMEA increased revenue 78% sequentially as a result of recovering the PDP business for defense and higher PMP and enterprise revenues. North America was lower by 18% sequentially on lower PDP and PMP revenues, partially offset by higher enterprise revenues. APEC increased by 25% sequentially on higher enterprise and PDP revenues, and Latin America improved by 8% quarter over quarter.

Speaker Change: partially offset by increased defense orders in Europe .

Speaker Change: While we typically expect Defense to grow with historical trends during the second half of the year, this year we're seeing a delay in projects.

Speaker Change: due to budget prioritization both for domestic and international defense projects.

Jacob Sayer: In me, it increased revenue 78% sequentially as a result of the recovery in the P to P business for defense and higher PMP and enterprise. North America was lower by 18% sequentially on lower P2P and PNP revenues, which hardly offset my higher enterprise.

Speaker Change: So looking at it by Regim.

Speaker Change: EMEA increased revenue 78% sequentially as a result of recovery in the P2P business for defense and higher PMP and enterprise revenues.

Speaker Change: North America was lower by 18% sequentially on lower P2P and PNP revenues.

Jacob Sayer: APAC increased by 25% sequentially on higher enterprise and PPP revenues, and Latin America improved by 8% quarter over quarter. Well, let's move on to gross margin. Our non-gap gross margin for Q2-24 continued to move in the right direction and was 33.5% compared to 22.7% in Q1-20. The higher quarter-over-quarter non-gap gross margin was primarily the result of lower material costs, fewer rebates, and an improved mix of higher-margin enterprises. non-GAAP total operating expenses, including depreciation and amortization, in Q2, stood at $23.3 million, lower by $3 million sequentially as we managed expenses lower and due to certain one-time benefits.

Speaker Change: partially offset by higher enterprise revenues.

Speaker Change: APAC increased by 25% sequentially on higher enterprise and PPP revenues, and Latin America improved by 8% quarter over quarter.

Jacob Sayer: Now let's move on to gross margins. Our non-GAAP gross margin for Q224 continued to move in the right direction and was 33.5% compared to 22.7% in Q124. The higher quarter-over-quarter non-GAAP gross margin was primarily the result of lower material costs, fewer rebates, and an improved mix of higher-margin enterprise revenues. Non-GAAP total operating expenses, including depreciation and the amortization in Q2, stood at $23.3 million. Lower by $3 million sequentially as we manage expenses lower, and due to certain one-time benefits. Our non-GAAP net loss for Q224 was $7.1 million or loss of 25 cents per unit share, and compared to a non-GAAP net loss of $12.7 million or loss of 46 cents per unit share in Q1.

Speaker Change: Let's move on to gross margins.

Speaker Change: Our non-gap gross margin for Q2-24 continued to move in the right direction and was 33.5% compared to 22.7% in Q124.

Speaker Change: The higher quarter-over-quarter non-gap gross margin was primarily the result of lower material costs, fewer rebates, and an improved mix of higher margin enterprise revenues.

Speaker Change: Non-gap, total operating expenses, including depreciation and the amortization in Q2, stood at $23.3 million. Lower by $3 million sequentially as we manage expenses lower and do certain one-time benefits.

Speaker Change: Our non-GAAP net loss for Q2'24 was $7.1 million, or a loss of $0.25 per diluted share.

Speaker Change: and compared to an on-gap net loss of 12.7 million dollars or a loss of 46 percent, 46 cents per diluted sharing Q1.

Jacob Sayer: Adjusted to the DA for Q224 was a loss of $6.7 million compared to a loss of $15.5 million in Q124.

Speaker Change: I adjusted the BDA for Q224 was a loss of $6.7 million, compared to a loss of $15.5 million in Q124.

Jacob Sayer: Now let's move on to cash flow in the balance sheet. Cash provided by operating activities was $2.4 million for Q224 compared to cash used in operating activities of $15.4 million per Q1. We are focused on improving the order to cash cycle, reducing inventories, and managing work in capital closely. Cash totaled $42.6 million as of June 30th, and free cash flow for the quarter was negative $1.8 million. We continue to manage our cost base and have reduced our breakeven point to an approximately $55 million quarterly revenue run rate. Net inventories of $50 million in Q224 decreased by 5.6 million from Q1, driven by both consumption and increased inventory reserves.

Jacob Sayer: Our non-GAAP net loss for Q224 was $7.1 million, or a loss of $0.25 per diluted share, and compared to an on-gap net loss of $12.7 million, or a loss of 46 cents per diluted share, in Q1. Adjusted EBITDA for Q2'24 was a loss of $6.7 million, compared to a loss of $15.5 million in Q1. Now let's move on to cash flow and the balance. Cash provided by Operating Activities was $2.4 million for Q2-24 compared to cash used in Operating Activities of $15.4 million for Q1.

Speaker Change: Now let's move on to cash flow in the balance sheet.

Speaker Change: Cash provided by operating activities was 2.4 million dollars for Q2-24 compared to cash used in operating activities of 15.4 million dollars for Q1.

Jacob Sayer: We are focused on improving the order to cash cycle, reducing inventories, and managing working capital closely. Cash totaled $42.6 million as of June 30, and free cash flow for the quarter was negative $1.8 million. We continue to manage our cost base and have reduced our breakeven point to approximately $55 million in quarterly revenue. Net inventories of $50 million in Q2-24 decreased by $5.6 million from Q1, driven by both consumption and increased inventory reserves.

Speaker Change: We are focused on improving the order-to-cash cycle, reducing inventories, and managing working capital closely.

Operator: At this time, I would like to welcome everyone to the Cambium Networks' second quarter 2024 Financial Results Conference call. All lines have been placed on mute to prevent any background noise. After the speakers remarks, there will be a question and answer session. As a reminder, this call is being recorded. To ask a question during the session, you will need to press Star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press Star 1-1 again. Please limit yourself to one question and one follow-up question. Thank you.

Speaker Change: Cash totaled $42.6 million as of June 30th.

Speaker Change: and free cash flow for the quarter was negative 1.8 million dollars.

Speaker Change: We continue to manage our cost base and have reduced our break-even point to an approximately $55 million quarterly revenue run rate.

Speaker Change: net inventory is a $50 million in Q2, 24 decreased by 5.6 million from Q1 driven by both consumption and increased inventory reserves.

Jacob Sayer: ENO reserves are primarily driven by estimated long-term demand for our product. These estimates can change over time and are dependent on the market, future technology development, and anticipated technology migration. Our goal for 2024 is to reduce our inventories to approximately 90 days outstanding, and that's down from 157 days. Moving to the third quarter and full year 24. Financial Outlook. Considering our current visibility,

Jacob Sayer: Yeno reserves are primarily driven by estimated long-term demand for our products. These estimates can change over time and are dependent on the market, future technology development, and anticipated technology migration.

Speaker Change: You know, reserves are primarily driven by estimated long-term demand for our products. These estimates can change over time and are dependent on the market, future technology development, and anticipated technology migration.

Peter Schuman: Mr. Peter Schuman, Vice President of Investor, Industry, Analyst, and Public Relations, you may begin your conference. Thank you, Steven. Welcome and thank you for joining us today for Cambium Networks' second quarter 2024 Financial Results Conference call and welcome to all those joining by webcasts. Working Kirk, our President and CEO and Jacob Sayer, our CFO, are here for today's call. The financial results press release and commentary referenced on this call are accessible on the investor page of our website and the press release has been submitted on a form 8K with the SEC.

Jacob Sayer: Our goal for 2024 is to reduce our inventories to approximately 90 days outstanding, and that's down from 157 days at the end of June.

Speaker Change: Our goal for 2024 is to reduce our inventories to approximately 90 days outstanding, and that's down from 157 days at the end of June .

Jacob Sayer: Moving to the third quarter and full year 24 financial outlook. Considering our current visibility, our Q324 financial outlook is as follows. Revenue between $43 to $48 million. Non-GAAP Pro's margin between $41.5 and $43.5%. Non-GAAP net loss between $5.4 million to $3.8 million, or net loss per diluted share between 19 and 14 cents. The Justity of the DA is expected to be between a negative $4.4 to a negative $2.4 million. And the Justity of the DA margin between a negative $10.2 to a negative $4.9%. Our updated full year of 2024 financial outlook is expected to be as follows.

Speaker Change: Moving to the third quarter and full year 24.

Jacob Sayer: Our Q3-24 financial outlook is as follows: revenue between 43 to 48 million dollars, non-GAAPPRO's margin between 41.5 and 43.5 percent, non-GAAP net loss between $5.4 million and $3.8 million, or net loss per diluted share between $19 and $14. Adjusted EBITDA is expected to be between a negative 4.4 to a negative 2.4 million dollars, and adjusted EBTA margin between a negative 10.2 to a negative 4.9. Our updated full year 2024 financial outlook is expected to be as follows.

Speaker Change: Financial Outlook.

Speaker Change: Considering our current visibility, our Q3-24 financial outlook is as follows.

Peter Schuman: A copy of today's prepared remarks will also be available on our investor page at the conclusion of this call. As a reminder, today's remarks, including those majoring Q&A will contain forward-lifting statements about the company's outlook and forecasted performance. These statements are based on current conditions, forecast, and assumptions. Risk and uncertainty could cause actual results to differ materially. Except as required by law, Cambium Networks does not undertake any obligations to update or revise any forward-lifting statements for any reason after the date of this presentation, whether as a result of new information, future developments, to conform these statements to actual results or to make changes in Cambium's expectations or otherwise.

Speaker Change: Revenue between $43 to $48 million.

Speaker Change: Non-GAPPRO's margin between 41.5 and 43.5 percent.

Speaker Change: non-gap net loss between 5.4 million dollars to 3.8 million dollars or net loss per diluted share between 19 and 14 cents.

Speaker Change: The Justice Unit is expected to be between a negative 4.4 to a negative 2.4 million dollars.

Speaker Change: and adjusted EBITDA margin between a negative 10.2 to a negative 4.9 percent.

Speaker Change: Our updated fully year 2024 financial outlook is expected to be as follows.

Jacob Sayer: Revenue is between $180 and $190 million. Non-Gap Pro's margins of approximately 37%. Non-Gap net loss between $29.4 and net loss of $24.6 million or loss of between $1.4 to $87 per diluted share. The Justity of the DA margins are expected to be between a negative $16.2% to a negative 12%.

Jacob Sayer: Revenues between $180 million and $190 million, non-GAAP gross margins of approximately 37 percent, non-GAAP net loss between $29.4 and a net loss of $24.6 million, or a loss of between $1.04 to $0.87 per diluted share. Adjusted EBITDA margins are expected to be between a negative 16.2% to a negative 12%. In summary, excluding the E&O charge, we delivered what we promised in the second quarter. Looking forward, while the incremental steps may not be as large as we would like, the company is moving in the right direction, and we expect it to continue to improve financially from here. I'll now turn the call back to Morgan for his closing remarks.

Speaker Change: Revenue is between a hundred and eighty and a hundred and ninety million dollars.

Peter Schuman: It is Cambium Networks' policy not to reiterate our financial outlook. We encourage listeners to review the full list of risk factors included in the State Harper statement in today's financial results press release for most recent SEC filings, including our most recent form 10K and form 10Qs. We will also reference both GAP and non-GAP financial measures and specifically note that all sequential and year-over-year comparisons reference non-GAP numbers except for otherwise noted. A reconciliation of non-GAP measures to GAP is included in the appendix to today's financial results press release, which can be found on the investor page of our website and it's today's press release announcing our results.

Speaker Change: non-gap gross margins of approximately 37%.

Speaker Change: non-gap net loss between 29.4 and a net loss of 24.6 million dollars or loss of between one dollar four cents to 87 cents per diluted share.

Speaker Change: Adjusted EBITDA margins are expected to be between a negative 16.2 percent to a negative 12 percent.

Jacob Sayer: In the summary, excluding the ENO charge, we delivered what we promised in the second quarter. Looking forward, while the incremental steps may not be as large as we would like, the company is moving in the right direction, and we expect to continue to improve financially from here.

Speaker Change: in the summary.

Speaker Change: excluding the E&O charge, we delivered what we promised in the second quarter.

Speaker Change: Looking forward, while the incremental steps may not be as large as we would like, the company is moving in the right direction.

Operator: Turning to the agenda, Morgan will provide the key operational highlights for the second quarter 2024 and Jacob will provide a recap of the financial results for the second quarter 2024 and will discuss our financial outlook for the third quarter in full year 2024. Our prepared room remarks will be followed by a Q&A session.

Morgan Kurk: I'll now turn the call back to Morgan for closing remarks.

Speaker Change: And we expect to continue to improve financially from here.

Morgan Kurk: Thank you, Jacob. My first year with Cambium has been challenging, but as I assess our progress, I believe we have passed the most difficult point. For the past year, I have outlined three focus areas: improved operational excellence, platforming, and optimizing our go-to-market for enterprise. We have significantly improved our operational performance with increased focus and new processes. We are streamlining our supply chain and reducing channel inventories, which positions us better for the future. Our platforming work is under wary and will bear fruit in faster product development, reduced lead times, improved efficiencies in operations and sales, and lower overall costs.

Speaker Change: I'll now turn the call back to Morgan for closing remarks.

Morgan Kurk: My first year with Cambium has been challenging, but as I assess our progress, I believe we have passed the most difficult point. For the past year, I've outlined three focus areas: Improved Operational Excellence, Platforming, and Optimizing our Go-To-Market Principles. We have significantly improved our operational performance with increased focus and new processes. We are streamlining our supply chain and reducing channel inventories, which positions us better for the future.

Morgan Kurk: Thank you, Jacob.

Morgan Kurk: My first year with Cambium has been challenging, but as I assess our progress, I believe we have passed the most difficult point.

Morgan Kurk: For the past year, I've outlined three focus areas.

Morgan Kurk: I now like to turn the call over to Morgan. Thank you, Peter.

Morgan Kurk: Improved Operational Excellence, Platforming, and Optimizing our Go-to-Market for Enterprise.

Morgan Kurk: Summarizing performance of Q2-24. Revenues for Q2-24 were $45.9 million. We are pleased revenues were just above the midpoint of the outlook we provided during our Q1-24 financial results call. With revenues ups sequentially by 9% due to continued growth in our enterprise business, with higher revenues in all geographies and growth in our point to multi-point PMP. Business. Adjusted Gross Margin improved, again, quarter to quarter, used by higher than expected reserves, taken for excess finished goods and raw materials. Excluding the unexpected ENO charges, adjusted gross margins would have been 44.4% above our guidance for the quarter. Operating margins improved sequentially as we continue to control expenses to lower our rate even point.

Morgan Kurk: We have significantly improved our operational performance with increased focus and new processes.

Morgan Kurk: We are streamlining our supply chain and reducing channel inventories, which positions us better for the future.

Morgan Kurk: Our platforming work is underway and will bear fruit in faster product development, reduced lead times, improved efficiencies in operations and sales, and lower overall costs. Our enterprise business is growing, and as we change the way we interact with our partners, I expect this to accelerate. Our PMP business is positioned to grow with the approval of both our E-PMP and PMP product lines at 6 GHz, offering faster speeds, improved reliability, and increased bandwidth.

Morgan Kurk: Our platform work is underway and will bear fruit in faster product development, reduced lead times, improved efficiencies in operations and sales, and lower overall costs.

Morgan Kurk: Our enterprise business is growing, and as we change the way we interact with our partners, I expect this to accelerate. Our PMP business is positioned to grow with the approval of both our EPMP and PMP product lines of six gigahertz, offering faster speeds, improved reliability, and increased bandwidth. We expect to see the benefit as our product ramps in North America, as well as with the future opening of six gigahertz spectrum for PMP use in other countries around the world. Our enterprise business is at the start of a new product cycle with Wi-Fi 7, channel inventories have been reduced, and are switching and software businesses up our competitive product lines.

Morgan Kurk: Our enterprise business is growing, and as we change the way we interact with our partners, I expect this to accelerate.

Morgan Kurk: Our PMP business is positioned to grow with the approval of both of them.

Morgan Kurk: Our EPMP and PMP product lines six gigahertz offering faster speeds, improved reliability, and increased bandwidth.

Morgan Kurk: We expect to see the benefit as our product ramps in North America, as well as with the future opening of 6 GHz spectrum for PMP use in other countries around the world. Our enterprise business is at the start of a new product cycle with Wi-Fi 7, channel inventories have been reduced, and our switching and software businesses offer a competitive product line. Finally, I'd like to share my continued appreciation for all those involved in our transformation. The effort and loyalty are appreciated, and I believe will be rewarded in the long run. With that, I'd like to turn the call back over to Stephen and begin the Q&A session.

Morgan Kurk: We expect to see the benefit as our product ramps in North America, as well as with the future opening of 6 GHz spectrum for PMP use in other countries around the world.

Morgan Kurk: Re-cash flow was negative $1.8 million during Q2-24 and our cash balance stood at $42.6 million as of June 30th. Cash flow from operations was positive $2.4 million. This is the first time it was positive in six quarters.

Morgan Kurk: Our enterprise business is at the start of a new product cycle with Wi-Fi 7, channel inventories have been reduced, and our switching software businesses offer competitive product lineups.

Morgan Kurk: Finally, I'd like to share my continued appreciation to all those involved in our transformation. The effort and loyalty are appreciated, and I believe will be rewarded in the long run.

Morgan Kurk: We believe the business is moving in the right direction financially, operationally, and strategically. Sales of Cambiums products out of distribution channel as reported by Cambiums distributors were again higher for Q2-24 and Cambiums reported revenues and we saw a corresponding decline in channel inventory. We continue to make progress in cleaning channel inventory and some of our partners are at appropriate levels of inventory while other partners still have work to do. Sales in and sales out are expected to be at equilibrium by the end of the year, which is slightly longer than we had previously thought, a shorter lead time and higher interest rates are driving distributors to a greater level of efficiency than in the past. Looking forward, lower channel inventories will result in end users' demands more directly driving increased revenues.

Peter Schuman: With that, I'd like to turn the call back over to Steven and begin with the Q&A session.

Operator: Thank you. We will now open the call to your questions. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11. Our first question comes from the line of Scott Searle of Froth Capital. Your line is now open.

Morgan Kurk: With that, I'd like to turn the call back over to Stephen and begin with the Q&A session.

Operator: Thank you. We will now open the call for your questions. As a reminder to ask a question, you will need to press star 111 on your telephone and wait for your name to be announced.

Stephen: Thank you. We will now open the call for your questions. As a reminder, to ask a question you will need to press star 1 1 on your telephone and wait for your name to be announced.

Operator: to withdraw your question. Please press star one more again.

Scott Searle: Our first question comes from the line of Scott Searle of Roth Capital.

Morgan Kurk: To withdraw your question, please press star 1 one again.

Scott Searle: Your line is now open. Good afternoon. Thanks for taking my questions.

Speaker Change: Our first question comes from the line of Scott Searle of Froth Capital. Your line is now open.

Scott Searle: Good afternoon. Thanks for taking my questions. Maybe, Morgan, Jacob, just a couple of quick clarifications.

Scott Searle: Maybe I'm Morgan, Jacob. Just a couple of quick clarifications. Looking at the gross margins into the third quarter, you have them up slightly sequentially, but there were a lot of reserves that were taken in the second quarter. I'm wondering if you could clarify what those reserves or what are you thinking about and is embedded into those, that guidance for the third quarter. And also, you talked about, you know, cell through being higher than cell, and I think from the Wi-Fi product line or enterprise. The last couple of quarters, I think that's been in the 15 to 20 million range.

Scott Searle: Good afternoon. Thanks for taking my questions. Maybe it.

Scott Searle: I'm Morgan. Jacob, just a couple of quick clarifications.

Scott Searle: You know, looking at the gross margins into the third quarter, you have them up slightly sequentially, but there were a lot of reserves that were taken in the second quarter. I'm wondering if you could clarify what those reserves are, what are you thinking about, and is embedded into those, that guidance for the third quarter. And also, you talked about, you know, sell through being higher than sell in, I think, from the Wi-Fi product line or enterprise. The last couple of quarters, I think that's been in the 15 to 20 million range. I'm wondering if you could clarify we're still seeing that demand at those levels, and it sounds like you're expecting that to normalize by the end of this year. And then I had a follow-up.

Morgan Kurk: Looking at customer wins that are key to our future success.

Morgan Kurk: In the US, CalMAT, a provider of high-speed wireless broadband and digital services in the Central Valley and rural Northern California has deployed EPMP 4600 to serve residential and commercial users with improved service levels of 400 megabits per second downlink and 200 megabits per second uplink. They're providing high-speed internet service to agricultural operation, local businesses, and residential customers, enabling increased productivity, improved video experience, and a whole host of other broadband services. A selected cambium is their supplier due to our value proposition. Reliable high-performance service at an affordable cost. This in turn allows CalMAT to provide faster broadband speeds at a lower cost to their customers than the incumbent service provider.

Scott Searle: The last couple of quarters, I think that's been in the 15 to 20 million range. I'm wondering if you could clarify if we're still seeing that demand at those levels, and it sounds like you're expecting that to normalize by the end of this year.

Scott Searle: I'm wondering if you could clarify; we're still seeing that demand at those levels. And it sounds like you're expecting that to normalize by the end of this year.

Jacob Sayer: And then ahead of follow up. Thanks. I'll deal with the first half of that question.

Jacob Sayer: Thanks, Scott. I'll deal with the first half of that question, and I'll pass it to Morgan for the second.

Jacob Sayer: I'll pass it to Morgan for the for the second on the on the excess and obsolete. You're absolutely right. The charges have been pretty large for the last couple of quarters at $7 million each. You know, they stem from a series of tests that we do from an accounting perspective with regard to the component balances and finished good balances that we hold and that are held at our suppliers. For the third quarter, embedded in the guidance is just under a $2 million assumption for you know. We don't have, you know, a current list of those products in terms of where would you expect to see that. You know, it's just a placeholder at the moment.

Morgan Kurk: I'll deal with the first half of that question and I'll pass it to Morgan for the second. On the excess and obsolete, you're absolutely right. The charges have been pretty large for the last couple of quarters at $7 million each. They, you know, they stem from

Jacob Sayer: On the excess and obsolete equipment, you're absolutely right. The charges have been pretty large for the last couple of quarters at $7 million each. They, you know, they stem from a series of tests that we do from an accounting perspective with regard to the component balances and finished goods balances that we hold and that are held at our suppliers. For the third quarter, embedded in the guidance is just under a $2 million assumption for D&O.

Morgan Kurk: a series of tests that we do from an accounting perspective with regard to the component balances and finished goods balances that we hold and that are held at our suppliers.

Morgan Kurk: For the third quarter, embedded in the guidance is just under a two million dollar assumption for E&O. We don't have, you know, a current list of those products in terms of where we'd expect to see that E&O. It's just a placeholder at the moment.

Jacob Sayer: We don't have, you know, a current list of those products in terms of where we'd expect to see them. It's just a placeholder at this point. But we do expect them to decrease substantially from where we've been in the last couple of quarters.

Morgan Kurk: In England, Bonayas, a rural broadband provider, is leveraging cambium networks, CNWade at 60 GHz mesh technology to bring improved connectivity to Wal-Me Island. Bonayas is deploying cambium technology to make gigabit broadband available to more than 10,000 island residents.

Jacob Sayer: But we do expect it to reduce substantially from where we've been in the last couple of quarters.

Morgan Kurk: Second part, sorry, go ahead, Scott. The second part of your question had to do with the level at which our inventory was destocking. It's less than it was in the past, but still on the order of the $10 million range. We destock on a quarterly basis.

Morgan Kurk: But we do expect it to reduce substantially from where we've been in the last couple of quarters.

Morgan Kurk: Sorry, go ahead, Scott. No, no, no, please continue. Thank you. The second part of your question had to do with the level at which our inventory was destocking. It's less than it was in the past, but still on the order of the $10 million range. It's destocking on a quarter of this. It was PLS. Yes.

Speaker Change: Sorry, go ahead, go ahead, go

Speaker Change: Oh no, no, please continue. Thank you. The second part of your question had to do with the level at which our inventory was the stocking. It's less than it was in the past, but still on the order of the 10 million dollar range.

Morgan Kurk: This collaboration aims to support the community's economic development and enhance educational opportunities for local students. Cambium was selected due to the speed which the system can be deployed. This is enabled by leveraging existing physical infrastructure and combining with Cambium's mesh technology, which also reduces the total cost of ownership.

Morgan Kurk: was POS.

Morgan Kurk: I'm sorry, Morgan, just to clarify, so the delta in the sell-in versus sell-out,

Speaker Change: It's restocking on a quarter of a day. I think it was a POS. Also.

Scott Searle: I'm sorry, Morgan. Just to clarify. So the delta in the cell in versus a cell through is $10 million. Is that roughly the range that we're talking about for the second quarter? Absolutely. Those are the types of numbers. Yes. Okay. Gotcha. Remember those numbers come from our supply; are our distributors. So they're not, not accurate. So I can only give you a range, but around that range, that number. Okay, fair enough.

Speaker Change: I'm sorry, Morgan, just to clarify, so the delta in the sell-in versus sell-through is 10 million, is that roughly the range that we're talking about for the second quarter? Approximately, those are the types of numbers, yes.

Morgan Kurk: Approximately, those are the types of numbers, yes. Okay. Gotcha. And if I put the...

Speaker Change: Remember, those numbers come from our distributors, so they're not accurate, so I can only give you a range, but around that range, that number.

Scott Searle: Okay, fair enough. And if I could, on the point-to-multipoint front, it's been a couple years of headwinds due to multiple product cycles, spending patterns, et cetera. But I'm starting to hear, it sounds like you're becoming more optimistic about the gigahertz product cycle. So I'm wondering if you could give us some broad-based thoughts in terms of how you're thinking about 2025, in terms of it contributing.

Scott Searle: And if I could, on the point, the multi point front, it's been a couple years of headwinds due to multiple product cycles, spending patterns, et cetera. But I'm starting to hear it sounds like you're becoming more optimistic about the gigahertz product cycle. So I'm wondering if you could give us some broad-based thoughts in terms of how you're thinking about 2025 in terms of its contributing. And maybe wrap that into the B conversation in terms of the dialogue that you're having with customers and how that kind of feathers into that funding opportunity. And in aggregate, then if I look at point to multi point, you know, we're under 20 million on a quarterly basis.

Morgan Kurk: Now let's turn to upcoming product introductions since our previous quarterly update.

Speaker Change: Okay, fair enough. And if I could, on the point-to-multipoint front, it's been a couple years of headwinds due to multiple product cycles, spending patterns, etc.

Morgan Kurk: In June, we announced the release of a new PTP product for our commercial customers in the 80 gigahertz EVAM, the PTP 850EX. The product delivers 10 gigabit capacity and features a smaller form factor than prior product versions at a very compelling price.

Speaker Change: But I'm starting to hear, it sounds like you're becoming more optimistic about the gigahertz product cycle. So, I'm wondering if you could give us some broad-based thoughts in terms of how you're thinking about 2025 in terms of it contributing. And maybe wrap that into the B conversation in terms of the dialogue that you're having with customers and how that kind of feathers into that funding opportunity.

Morgan Kurk: And maybe wrap that into the B conversation in terms of the dialogue that you're having with customers and how that kind of fits into that funding opportunity. And in aggregate, then, if I look at point-to-multipoint, you know, we're under $20 million on a quarterly basis. It peaked at close to $60 million a quarter. When we start to get to a normalized environment, maybe in the second half of next year, what's the bogeyman, you know, in terms of revenue run rate that we should be thinking about? Thanks. Okay.

Morgan Kurk: The EVAM's ideal for building to building another point to point connectivity as an alternative to fiber or as a backup to fiber and is used for applications such as back calling outdoor Wi-Fi and video surveillance.

Scott Searle: It peaked at close to 60 million a quarter. When we start to get to a normalized environment, maybe in the second half of next year, what's the bogey? You know, in terms of revenue run rate that we should be thinking about.

Speaker Change: And in aggregate, then, if I look at point-to-multipoint, you know, we're under $20 million on a quarterly basis. It peaked at close to $60 million a quarter. When we start to get to a normalized environment, maybe in the second half of next year, what's the bogey, you know, in terms of revenue run rate that we should be thinking about? Thanks. Okay.

Morgan Kurk: For channel partners, we have introduced a new concierge program called Elite. Managed Wi-Fi service providers, value-outed resellers and system integrators are eligible for this select program. The enhanced program introduces a new partner level, offering a host of benefits designed to accelerate growth, reduce risk, and increase sales velocity. The program includes personalized support in the deployment of Cambium-1 solutions from a senior technical staff member assigned to the account as a consultant, an expertise from specialized technical staff for onboarding and customer engagement.

Morgan Kurk: Thanks. Okay. I feel like Rodney Dangerfield, one question in 27 parts. So I'll try to make sure I am through all of it. In terms of PMP and how we foresee the future, while I don't think bead will have a measurable impact in 25, probably will happen late 25 or 26 before that really has an opportunity. We speak to customers. They're putting their plans in. They're trying to get state governments, 26 of which now have been called, funded by the sub said. They're trying to get their plans in, and then there'll be a progression to get money, and then there will be a plan to roll out, and eventually that will turn into equipment for us.

Morgan Kurk: Okay, I feel like Rodney Dangerfield. I have one question in 27 parts, so I'll try to make sure I answer all of it. In terms of PMP and how we foresee the future, while I don't think BEAD will have a measurable impact in 2025, it probably will happen late 2025 or 2026 before that really has an opportunity. As we speak to customers, they're putting their plans in. They're trying to get state governments, 26 of which have already been funded by the Fed.

Speaker Change: I feel like Rodney Dangerfield. I have one question in 27 parts, so I'll try to make sure I answer all of it.

Speaker Change: In terms of PMP,

Speaker Change: and how we foresee the future.

Speaker Change: While I don't think speed will have a measurable impact in 2025,

Speaker Change: Probably will happen late 25 or 26 before that really has an opportunity, as we speak to customers, they're putting their plans in, they're trying to get...

Morgan Kurk: Finally, total devices under CM Maestro Cloud Management in Q2-24 increased approximately 6% from Q1-24 and was up 15% year-over-year.

Speaker Change: State governments, 26 of which now have been funded by the Fed. They're trying to get their plans in, and then there will be a progression to get money, and then there will be a plan to roll out, and eventually that will turn into equipment for us.

Morgan Kurk: They're trying to get their plans in, and then there will be a progression to get money, and then there will be a plan to roll out, and eventually that will turn into equipment for us. We've been speaking to them about that, and so that's sort of our view on that. It's late 2025, early 2026. There are still a lot of questions around it because, today, it requires licensed spectrum. And remember, 6 gigahertz is unlicensed spectrum. There are some thoughts that this may change, which could have a material positive impact on us. Um, the reason I'm, I'm, I'm more in, um, I guess.

Morgan Kurk: We've been speaking to them about that, and so that's sort of our view on that. It's a late 25 or really 26. There's still a lot of questions around it because today it requires licensed spectrum, and remember six gigahertz is unlicensed spectrum. There are some thoughts that this may change that could have a material positive impact for us. The reason I'm I'm more in I guess I'm more optimistic is that we've kind of what I think hit a floor in terms of people's low point on their spend, and we're starting to have a better appreciation for what it will take to roll out six gigahertz services.

Jacob Sayer: I will now turn the call over to Jacob for a review of our Q2-24 financial results and Q3-24 in full-year 2024 financial outlet. Thank you, Marvin. Q2-24 top-line results of $45.9 million increased 9% from Q1 due to growth in our enterprise and PMD businesses. Q2-result included additional inventory charges, flyer commitment and reserves which impact across margins by approximately $7 million, which was $5 million more than we expected at the beginning of the quarter.

Speaker Change: We've been speaking to them about that, and so that's sort of our view on that. It's a late 25, early 26.

Speaker Change: There's still a lot of questions around it because today it requires licensed spectrum. And remember, 6 gigahertz is unlicensed spectrum. There are some thoughts that this may change. That could have a material positive impact for us.

Speaker Change: [inaudible]

Morgan Kurk: I'm more optimistic that we've kind of, what I think, hit a floor in terms of people's low point on their spend, and we're starting to have a better appreciation for what it will take to roll out. I am optimistic that it will happen in the next few quarters as people figure out what it takes to avoid the incumbents, deploy these systems, and get the higher data rates and returns they want with their customers.

Speaker Change: I guess.

Speaker Change: I'm more optimistic is that we've kind of, what I think, hit a floor in terms of people's low point on their spend, and we're starting to have a better appreciation for what it will take to roll out.

Jacob Sayer: How do you know that in line with expectations non-gap growth margins would have been approximately 44.4%, slightly better than expectations due to stronger enterprise sales. We continue to work hard to manage our operating costs, focusing resources on those products and projects that are most critical for Cambium's future success. Turning to revenue in the quarter. The increased revenue was mostly due to growth in the enterprise business which grew 58% sequentially, as demand improved in all geographies and channels, inventories continued to decline.

Morgan Kurk: We thought this would happen faster, but I am optimistic that it will happen in, I'll call it the next few quarters, as people figure out what it takes to avoid the incumbents, deploy these systems, and get the higher data rates and returns they want with their customs. Well, Morgan, I don't know if you'd be willing to go this far, but, you know, I'll call the quote-unquote normalize more, more normalized environment.

Speaker Change: 6GHz services.

Speaker Change: We thought this would happen faster, but I am optimistic that it will happen in, I'll call it the next few quarters, as people figure out what it takes to avoid the incumbents, deploy these systems, and get the higher data rates and returns they want with their customers.

Morgan Kurk: Morgan, I don't know if you'd be willing to go this far, but, you know, in a, I'll call it a quote-unquote normalized, more normalized environment, what do you think point-to-multipoint revenues would look like on a quarterly basis?

Morgan Kurk: Very helpful, thank you. Morgan, I don't know if you'd be willing to go this far, but, you know, in a, I'll call it a quote-unquote normalized, more normalized environment, what do you think point-to-multipoint revenues look like on a quarterly basis?

Jacob Sayer: Our PMP business grew slightly at 1% sequentially thanks to strengths in our EPMP product lines in Europe and Asia Pacific. Our North America PMP business remains slow as service riders are still working to understand the nuances of the six gigahertz PMP solution before moving to volume deployments. The point-to-point business declined by 5% sequentially due to the completion of a large North American licensed microwave installation in the prior quarter in Q1, partially offset by increased defense orders in Europe.

Scott Searle: What do you think point-to-multi-point revenues look like on a quarterly basis?

Morgan Kurk: So, I'm not prepared to answer that at this point, but I will take that for future reference for you. Thanks, Scott.

Scott Searle: I'm not prepared to answer that at this point, but I will take that for future reference to you. Thanks. Sure enough, thank you so much. Thank you.

Morgan Kurk: So I'm not prepared to answer that at this point, but I will take that for future reference to you.

Scott Searle: Thanks, Scott. Fair enough. Thanks so much.

Morgan Kurk: Thanks. Thanks so much. Thank you.

Simon Leopold: Our next question comes from the line of Simon Leopold, Framian James.

Simon Leopold: Our next question comes from the line of Simon Leopold, Framon James. Your line is now open.

Morgan Kurk: Thank you.

Simon Leopold: Here, line is now open. Thanks for taking the question. I want to see if maybe you can unpack your thoughts about the four-year forecast because basically you've given us September or given us a four-year so that allows us to determine what you're assuming for the fourth quarter and basically it looks like you average 36 millionish in 3Q and 4Q. I'm just wondering if there's a good reason why the fourth quarter shouldn't be showing further signs of improvement.

Morgan Kurk: Our next question comes from the line of Simon Leopold, Framon James. Your line is now open.

Simon Leopold: Thanks for taking the question. I want to see if maybe you could unpack your thoughts about the two-year forecast because basically, you've given us September or given us a full year, so that allows us to determine what you're assuming for the fourth quarter, and basically, it looks like you averaged 36 million-ish in 3Q and 4Q. I'm just wondering if there's a good reason why the fourth quarter shouldn't be showing further signs of improvement.

Simon Leopold: Thanks for taking the question. I want to see if maybe you could unpack your thoughts about the full-year forecast, because basically you've given us September , you've given us the full year, so that allows us to determine what you're assuming for the fourth quarter. And basically it looks like you average...

Jacob Sayer: While we typically expect defense to grow with historical trends during the second half of the year, this year we're seeing a delay in broad, due to budget prioritization, both for domestic and international defense projects. So looking at it by region, EMEA increased revenue 78% sequentially as a result of recovering the PDP business for defense and higher PMP and enterprise revenues. North America was lower by 18% sequentially on lower PDP and PMP revenues, partially offset by higher enterprise revenues. APEC increased by 25% sequentially on higher enterprise and PDP revenues, and Latin America improved by 8% quarter over quarter.

Speaker Change: 36 million-ish in 3Q and 4Q. I'm just wondering if there's a good reason why the fourth quarter shouldn't be showing further signs of improvement.

Simon Leopold: I'm looking for a trajectory and whether or not you think I'm misinterpreting it or if there's some aspect of the maximum you're concerned about. Just tell folks to unpack what it applies for the fourth quarter. Thank you. Yeah, so if you unpack the guidance at the midpoint of that 185, you can kind of back into a number close to 51 million for Q4. That's a pretty simple, simple math. So it is an improvement sequentially. It's what we're expecting in the fourth quarter. These are down from our prior expectations with regard to weakness and defense, which we mentioned on the call, and some slow ramps, especially in the six-figured space for PMP.

Simon Leopold: Basically, I'm looking for a trajectory, and whether or not you think I'm misinterpreting it, or if there's some aspect of the macro you're concerned about, just help us unpack what's applied to the fourth quarter. Thank you.

Mason: Mason, looking for a trajectory and whether or not you think I'm disinterpreting it, or if there's some aspect of the MAC that you're concerned about, just tell folks what's applied for the fourth corner.

Jacob Sayer: Yeah, so if you unpack the guidance at the midpoint of that 185, you can kind of back into a number close to 51 million for Q4. That's pretty simple math. So it is an improvement sequentially, and that's what we're expecting in the fourth quarter. You know, these are down from our prior expectations with regard to weakness in defense, which we mentioned on the call, and some slow ramps, especially in the 6 gigahertz space for PMP. But we are expecting sequential improvement, especially as we go into the fourth.

Mason: Yeah, so if you unpack the guidance at the midpoint of that 185, you know, you can kind of back into a number close to 51 million for Q4. That's pretty simple math. So it is an improvement sequentially. It's what we're expecting in the fourth quarter.

Jacob Sayer: Now let's move on to gross margins. Our non-gap gross margin for Q224 continued to move in the right direction and was 33.5% compared to 22.7% in Q124. The higher quarter over quarter non-gap gross margin was primarily the result of lower material costs, fewer rebates, and an improved mix of higher margin enterprise revenues. Non-gap total operating expenses, including depreciation and the amortization in Q2, stood at $23.3 million. Lower by $3 million sequentially as we manage expenses lower, and due to certain one-time benefits.

Speaker Change: Yeah, these are down from our prior expectations with regard to weakness in defense, which we mentioned on the call, and some slow ramps, especially in the 6 gigahertz space for PMP. But we are expecting sequential improvement, especially as we go into the fourth quarter.

Jacob Sayer: But we are expecting sequentially improvement, especially as we go into the fourth quarter.

Simon Leopold: And there are some thriving ones, I guess, is what I'm looking for.

Jacob Sayer: So what's driving that, I guess, is what I'm looking for. What's driving the lower forecast in prior, or what's driving it off sequentially? What's driving the sequential improvement? So, sort of where is the recovery coming from? Yeah, it's coming from sequential enterprise growth and then some growth in PMP. Thank you.

Simon Leopold: So what's driving the lower forecast than prior?

Speaker Change: It's what's driving that, I guess, is what I'm looking for.

Jacob Sayer: What's driving the sequential improvements? So sort of, you know, where is the recovery coming from? Yeah, it's coming from sequential enterprise growth and then some growth in PMP.

Speaker Change: So what's driving the lower forecast than prior, or what's driving it off?

Speaker Change: What's driving the sequential improvements? Where is the recovery coming from? It's coming from sequential enterprise growth.

Jacob Sayer: Our non-gap net loss for Q224 was $7.1 million or loss of 25 cents per unit share, and compared to a non-gap net loss of $12.7 million or loss of 46 cents per unit share in Q1. Adjusted to the DA for Q224 was a loss of $6.7 million compared to a loss of $15.5 million in Q124.

Mason: [inaudible]

Speaker Change: Thank you.

Operator: As a reminder, to ask a question, you'll need to press star 111 on your telephone and wait for your name to be announced. We'll give it one, two, three seconds here.

Operator: As a reminder, to ask a question, you'll need to press star 1-1 on your telephone and wait for your name to be announced. Give it one, two, three seconds here. All right, I am showing no further questions at this time. I would now like to turn it back to Peter Schuman for closing remarks.

Speaker Change: Do what?

Speaker Change: Thank you.

Speaker Change: As a reminder, to ask a question, you'll need to press star 11 on your telephone and wait for your name to be announced. We'll give it one, two, three seconds here.

Operator: All right, I am showing no further questions at this time.

Peter Schuman: I would now like to turn it back to Peter Schumann for closing remarks.

Speaker Change: All right, I am showing no further questions at this time. I would now like to turn it back to Peter Schuman for closing remarks.

Peter Schuman: Thank you, Stephen. During Q3-24, Cambium Networks will be meeting with investors in Chicago on Tuesday, August 27th at the Jefferies Technology, Media, and Consumer Conference. In the meantime, you're always welcome to contact our Investor Relations Department at 847-264-2188 with any questions that arise. Thank you for joining us, and this concludes today's call.

Peter Schuman: Thank you, Stephen.

Peter Schuman: During Q324, Cambium Networks will be meeting with investors in Chicago on Tuesday, August 27th at the Jeffrey's Technology, Media, and Consumer Conference. In the meantime, you're always welcome to contact our Investor Relations department at 847-264-2188 with any questions that arise.

Peter Schuman: Thank you, Steven. During Q324, Campeham Network, we're meeting with investors in Chicago on Tuesday, August 27th at the Jeffrey's Technology Media and Consumer Conference. In the meantime, you're always welcome to contact our investor relations department at 847-264-2188 with any questions that arise.

Peter Schuman: Thank you for joining us, and this concludes today's call.

Operator: All right, ladies and gentlemen, this does conclude today's quarterly earnings call. Thank you for your participation.

Operator: All right, ladies and gentlemen, this does conclude today's quarterly earnings call. Thank you for your participation. You may now log off.

Speaker Change: Thank you for joining us and this concludes today's call.

Speaker Change: Alright ladies and gentlemen, this does conclude today's quarterly earnings call. Thank you for your participation. You may now log off.

Operator: He may now log off.

Jacob Sayer: Net inventories of $50 million in Q224 decreased by 5.6 million from Q1 driven by both consumption and increased inventory reserves. Yeno reserves are primarily driven by estimated long-term demand for our products. These estimates can change over time and are dependent on the market, future technology development, and anticipated technology migration. Our goal for 2024 is to reduce our inventories to approximately 90 days outstanding, and that's down from 157 days at the end of June.

Jacob Sayer: Moving to the third quarter and full year 24 financial outlook. Considering our current visibility, our Q324 financial outlook is as follows. Revenue between $43 to $48 million Non-Gap Pro's margin between $41.5 and $43.5% Non-Gap Net Loss between $5.4 million to $3.8 million or net loss per diluted share between 19 and 14 cents. The Justity of the DA is expected to be between a negative $4.4 to a negative $2.4 million. And the Justity of the DA margin between a negative $10.2 to a negative $4.9% Our updated full year of 2024 financial outlook is expected to be as follows.

Jacob Sayer: Revenue is between $180 and $190 million. Non-Gap Pro's margins of approximately 37% Non-Gap Net Loss between $29.4 and net loss of $24.6 million or loss of between $1.4 to $87 per diluted share. The Justity of the DA margins are expected to be between a negative $16.2% to a negative 12%.

Morgan Kurk: I'll now turn the call back to Morgan for closing remarks. Thank you, Jacob.

Morgan Kurk: My first year with Cambium has been challenging, but as I assess our progress, I believe we have passed the most difficult point. For the past year, I have outlined three focus areas, improved operational excellence, platforming, and optimizing our go-to market for enterprise. We have significantly improved our operational performance with increased focus and new processes. We are streamlining our supply chain and reducing channel inventories, which positions us better for the future. Our platforming work is under wary and will bear fruit in faster product development, reduced lead times, improved efficiencies in operations and sales, and lower overall costs.

Morgan Kurk: Our enterprise business is growing, and as we change the way we interact with our partners, I expect this to accelerate. Our PMP business is positioned to grow with the approval of both our EPMP and PMP product lines of six gigahertz offering faster speeds, improved reliability, and increased bandwidth. We expect to see the benefit as our product ramps in North America, as well as with the future opening six gigahertz spectrum for PMP use in other countries around the world. Our enterprise business is at the start of a new product cycle with Wi-Fi 7, channel inventories have been reduced, and are switching and software businesses up our competitive product lines.

Operator: With that, I'd like to turn the call back over to Steven and begin with the Q&A session. Thank you.

Operator: We will now open the call for your questions. As a reminder to ask a question, you will need to press star 111 on your telephone and wait for your name to be announced, to withdraw your question. Please press star one more again.

Scott Searle: Our first question comes from the line of Scott Searle of Roth Capital. Your line is now open. Good afternoon. Thanks for taking my questions.

Jacob Sayer: Maybe I'm Morgan, Jacob, just a couple of quick clarifications. Looking at the gross margins into the third quarter, you have them up slightly sequentially, but there were a lot of reserves that were taken in the second quarter. I'm wondering if you could clarify what those reserves or what are you thinking about and is embedded into those, that guidance for the third quarter. And also, you talked about, you know, cell through being higher than cell and I think from the Wi-Fi product line or enterprise.

Jacob Sayer: The last couple of quarters I think that's been in the 15 to 20 million range. I'm wondering if you could clarify, we're still seeing that demand at those levels. And it sounds like you're expecting that to normalize by the end of this year. And then ahead of follow up. Thanks. I'll deal with the first half of that question. I'll pass it to Morgan for the for the second on the on the excess and obsolete.

Jacob Sayer: You're absolutely right. The charges have been pretty large for the last couple of quarters at $7 million each. You know, they stem from a series of tests that we do from an accounting perspective with regard to the component balances and finished good balances that we hold and that are held at our suppliers. For the third quarter, embedded in the guidance is just under a $2 million assumption for you know. We don't have, you know, a current list of those products in terms of where would you expect to see that, you know, it's just a placeholder at the moment.

Jacob Sayer: But we do expect it to reduce substantially from from where we've been in the last couple of quarters. Sorry, go ahead Scott. No, no, no, please continue. Thank you. The second part of your question had to do with the level at which our inventory was destocking. It's less than it was in the past, but still on the order of the $10 million range. It's destocking on a quarter of this. It was PLS.

Jacob Sayer: Yes. I'm sorry Morgan, just to clarify. So the delta in the cell in versus a cell through is $10 million. Is that roughly the range that we're talking about for the second quarter? Absolutely. Those are the types of numbers. Yes. Okay. Gotcha. Remember those numbers come from our supply are our distributors. So they're not not accurate. So I can only give you a range, but around that range, that number. Okay, fair enough.

Morgan Kurk: And if I could on the point, the multi point front, it's been a couple years of headwinds due to multiple product cycles, spending patterns, et cetera. But I'm starting to hear it sounds like you're becoming more optimistic about the gigahertz product cycle. So I'm wondering if you could give us some broad based thoughts in terms of how you're thinking about 2025 in terms of it contributing. And maybe wrap that into the B conversation in terms of the dialogue that you're having with customers and how that kind of feathers into that funding opportunity.

Morgan Kurk: And in aggregate, then if I look at point to multi point, you know, we're under 20 million on a quarterly basis. It peaked at close to 60 million a quarter. When we start to get to a normalized environment, maybe in the second half of next year, what's the bogey? You know, in terms of revenue run rate that we should be thinking about. Thanks. Okay. I feel like Rodney Dangerfield, one question in 27 parts. So I'll try to to make sure I am through all of it.

Morgan Kurk: In terms of PMP and how we foresee the future, while I don't think bead will have a measurable impact in 25 probably will happen late 25 or 26 before that really has an opportunity. We speak to customers. They're putting their plans in. They're trying to get state governments 26 of which now have been called funded by the sub said. They're trying to get their plans in and then they'll be a progression to get money and then there will be a plan to roll out and eventually that will turn into equipment for us.

Morgan Kurk: We've we've been speaking to them about that and so that's sort of our view on that. It's a late 25 or really 26. There's still a lot of questions around it because today it requires license spectrum and remember six gigahertz is unlicensed spectrum. There are some thoughts that this may change that could have a material positive impact for us. The reason I'm I'm more in I guess I'm more optimistic is that we've kind of what I think hit a floor in terms of people's low point on their spend and we're starting to have a better appreciation for what it will take to roll out six gigahertz services.

Morgan Kurk: We thought this would happen faster but I am optimistic that it will happen in, I'll call it the next few quarters as people figure out what it takes to avoid the incumbents, deploy these systems and get the higher data rates and returns they want with their customs. Well, Morgan, I don't know if you'd be willing to go this far but, you know, I'll call the quote-unquote normalize more, more normalized environment.

Morgan Kurk: What do you think point to multi-point revenues look like on a quarterly basis? I'm not prepared to answer that at this point but I will take that for future reference to you. Thanks. Sure enough, thank you so much. Thank you.

Simon Leopold: Our next question comes from the line of Simon Leopold, Framian James. Here line is now open. Thanks for taking the question. I want to see if maybe you can unpack your thoughts about the four-year forecast because basically you've given us September or given us a four-year so that allows us to determine what you're assuming for the fourth quarter and basically it looks like you average 36 millionish in 3Q and 4Q. I'm just wondering if there's a good reason why the fourth quarter shouldn't be showing further signs of improvement.

Simon Leopold: I'm looking for a trajectory and whether or not you think I'm misinterpreting it or if there's some aspect of the maximum you're concerned about just tell folks unpack what it applies for the fourth quarter. Thank you. Yeah, so if you unpack the guidance at the midpoint of that 185, you can kind of back into a number close to 51 million for Q4. That's a pretty simple, simple math. So it is an improvement sequentially.

Simon Leopold: It's what we're expecting in the fourth quarter. These are down from our prior expectations with regard to weakness and defense, which we mentioned on the call and some slow ramps especially in the six-figured space for PMP. But we are expecting sequentially improvement especially as we go into the fourth quarter. So what's driving that I guess is what I'm looking for. What's driving the lower forecast in prior or what's driving it off sequentially?

Simon Leopold: What's driving the sequential improvement? So sort of where is the recovery coming from? Yeah, it's coming from sequential enterprise growth and then some growth in PMP. Thank you. As a reminder, to ask a question, you'll need to press star 111 on your telephone and wait for your name to be announced. We'll give it one, two, three seconds here.

Jacob Sayer: All right, I am showing no further questions at this time.

Peter Schuman: I would now like to turn it back to Peter Schumann for closing remarks. Thank you, Stephen.

Peter Schuman: During Q324, Cambium Networks will be meeting with investors in Chicago on Tuesday, August 27th at the Jeffrey's Technology, Media and Consumer Conference. In the meantime, you're always welcome to contact our Investor Relations Department at 847-264-2188 with any questions that arise.

Operator: Thank you for joining us and this concludes today's call.

Operator: All right, ladies and gentlemen, this does conclude today's quarterly earnings call. Thank you for your participation.

Operator: He may now log off.

Q2 2024 Cambium Networks Corp Earnings Call

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