Q4 2024 Tigo Energy Inc Earnings Call
Good afternoon, and welcome to Chico industries fiscal fourth quarter and full year 2024 earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation there'll be a question and answer session joining us from Chico RSV, along CEO and Bill Rosemont CFO as it were.
Speaker Change: Reminder, this call is being recorded I would now like to turn the call over to Bill Roth Chief Financial Officer. Please go ahead.
Speaker Change: Thank you operator, we'd like to remind everyone that some of the matters, we'll discuss on this call, including our expected business outlook, our ability to increase our revenues and become profitable and our overall long term growth prospects expectations regarding a recovery in our industry, including the timing thereof statements about our demand for our products our competitive.
Speaker Change: <unk> in market share, our current and future inventory levels charges and reserves and their impact on future financial results inventory supply and its impact on our customer shipments and adjusted EBITDA for the first fiscal quarter 2025, and our revenue for the first fiscal quarter and full year of 2025 and 24.
Speaker Change: And our ability to penetrate new markets and expand our market share including expansion in international markets and investments in our product portfolio are forward looking and as such are subject to known and unknown risks and uncertainties, including but not limited to those factors described in today's press release.
Speaker Change: And described in the risk factors section of our most recent annual report on Form 10-K, and other reports we may file with the SEC from time to time. These.
Speaker Change: These risks and uncertainties could cause actual results to differ materially from those expressed on this call. These forward looking statements are made only as of the date when the date when made during our call today, we will reference certain non-GAAP financial measures. We include non-GAAP to GAAP reconciliations in our press release furnished as an exhibit to our form.
Speaker Change: 8-K.
Speaker Change: non-GAAP financial measures provided should not be considered a substitute for or superior to the measures of financial performance prepared in accordance with GAAP.
Z alone: Finally, I would like to remind everyone that this conference call is being webcast and a recording will be made available for replay on Tiger Tiger Woods Investor Relations website at investors Dot Tiger energy Dot com with that I'd like to now turn the call over to Tiger CEO Z alone.
Speaker Change: Okay.
Z alone: Thank you Bill.
Z alone: To begin today's discussion I will highlight key area.
Z alone: In a recent performance to lift up the past year and provide some commentary on our recent operational highlights before turning the call over to our CFO Bill loss line.
Bill Roth: He will discuss our financial results for the fourth quarter and no debt as well as provide our guidance for the first quarter of 2025.
Z alone: And full year of 2025.
Bill Roth: After that.
Bill Roth: I will share some closing remarks tell you about our outlook for the year 2025, and then open the call for questions.
Bill Roth: Analyst.
Bill Roth: Let's get started.
Bill Roth: I am pleased to report that we ended 2020 full we'd get another sequentially quarterly revenue growth, making get full either.
Bill Roth: For the fiscal year.
Bill Roth: Given how 2023 ended.
Bill Roth: I'm exceptionally proud of what our team at Tyco has.
Speaker Change: As the managed care companies.
Speaker Change: To give some geographical color on the results, we saw positive sales growth, especially within the EMEA and Americas regions during the quarter.
Speaker Change: Expanding our sales footprint into markets and doubling down on those efforts in key markets remained an area of focus for us.
Speaker Change: To sell only a few recent highlights our team has spent time in Malaysia in Hawaii to educate train and sale.
Speaker Change: For our portfolio.
Speaker Change: In the fourth quarter of 2024, we shipped 480000 MLP units.
Speaker Change: <unk> 2020 full MLP ships.
Speaker Change: 215 million units.
Speaker Change: Our DSO X product line continues to build momentum in the marketplace and we expect this trend to continue in 2025.
Speaker Change: Additionally, we achieved multiple utility scale wins in 2024, and our pipeline in this sector of the market continues to grow.
Speaker Change: Another key focus area is with <unk> AI software solution.
Speaker Change: Predict plus AI based energy consumption and production plateau.
Speaker Change: Continues to grow.
Speaker Change: We announced yesterday since the first quarter of 'twenty 'twenty four.
Speaker Change: This plus platform has gone from 15000.
Speaker Change: 140000 meters under management and Cabos, a total of 600 gigawatt hours of energy at year end.
Speaker Change: As predicted plus expense into Europe, and North America, we are bringing in machine learning to energy analytics and predictions two a new standard for MLG is forecasting.
Our annual recurring revenue or <unk>.
Speaker Change: I'll now stands above $1 million per year, and we expect it will continue to grow in 2025.
Speaker Change: Additionally.
Speaker Change: We just recently announced another great milestone.
Speaker Change: Since the inception of the program Green Glob has now reached 1000 site arrangements engagements globally, including over 700 C&I installations in over 300 residential solar installations.
Speaker Change: We are excited to see our efforts towards the total quality solo starting to pay off.
Bill Roth: And with that I would like to turn it over to Bill Bill.
Speaker Change: Zvi.
Speaker Change: Before I start reviewing the results of the fourth quarter I would like to address the inventory reserve charges that are significantly impacting many line items in our income statement as they are accounted for in the cost of revenue in.
Speaker Change: In 2020 for Argo ESF storage and solutions business represented 6% of total sales compared with 9% of total sales in the prior year.
Speaker Change: Reflecting the fact that this business line has not participated in our business recovery as well as we had anticipated.
Speaker Change: As you may be well aware of this segment of the market has many market participants competing for market share and battery prices in particular continue to fall at a significant rate.
Speaker Change: All of which negatively impacted companies holding high inventory positions as mentioned in our previous earnings call. The charges taken in both the third and fourth quarters reflect management's estimate of the inventories net realizable value and incorporates current and future expectations of the market environment.
Speaker Change: Now turning to the financial results for the fourth quarter ended December 31 2024.
Speaker Change: Revenue for the fourth quarter of 2024 increased to 86, 8% to $17 3 million from $9 2 million in the prior year period.
Speaker Change: On a sequential basis revenues increased 21, 3% with improved results coming from many countries in the EMEA and Americas regions, including the U S and Germany, along with some recovery in Italy.
Speaker Change: By region EMEA revenue was $11 2 million or 65% of total revenues and a 29, 3% sequential increase America.
Speaker Change: Americas revenue was $4 6 million or 27% of total revenues and a 57, 2% sequential increase.
Speaker Change: In APAC revenue was $1 5 million or 9% of total revenues and a decline of 44% sequentially.
Speaker Change: Gross loss in the fourth quarter of 2024, it was $12 6 million or negative 72, 7% of revenue compared to gross profit of $2 9 million or 31, 1% of revenue in the comparable year ago period.
Speaker Change: The year over year decline was primarily due to the previously mentioned inventory charge of $19 5 million.
Speaker Change: Operating expenses for the fourth quarter declined 29, 8% to $11 6 million compared to $16 4 million in the prior year period.
The decline was driven primarily by our previously announced cost cutting efforts.
Speaker Change: Operating loss for the fourth quarter increased by 77, 9% to $24 1 million compared to $13 5 million in the prior year period.
Speaker Change: GAAP net loss for the fourth quarter was $26 8 million compared to a net loss of $14 8 million in the prior year period, while we recorded a higher net loss on a GAAP basis for the fourth quarter compared to the prior year period absent the inventory charge our results reflect progress towards profitability.
Speaker Change: On a non-GAAP basis.
Speaker Change: Adjusted EBITDA loss in the fourth quarter increased 94% to 2020, $22 1 million compared to an adjusted EBITDA loss of $11 6 million in the prior year period.
Speaker Change: As a reminder, adjusted EBITDA is a non-GAAP measure that represents net loss as adjusted for interest and other expenses income tax expense depreciation amortization stock based compensation and M&A transaction expenses.
Speaker Change: Primary shares outstanding were $60 8 million for the fourth quarter of 2024.
Speaker Change: Turning to the balance sheet accounts receivable net decreased this quarter to $8 million compared to $8 8 million last quarter.
Speaker Change: An increase from $6 9 million in the year ago comparable period.
Speaker Change: Inventories net decreased by $24 8 million or 53% to 2000 $20 million to $22 million compared to $46 8 million last quarter and $61 $4 million in the year ago comparable period.
Speaker Change: Cash cash equivalents and short and long term marketable securities totaled $19 9 million at December 31, 2024 on a sequential basis cash increased by $400000 as we continued to make progress on reducing our inventory and working capital.
Speaker Change: Turning now to our financial outlook for our first quarter of 2025 and full year of 2025.
Speaker Change: As a reminder, tiger will provide quarterly guidance for revenue as well as adjusted EBITDA as we believe that these metrics to be key indicators for the overall performance of our business.
Speaker Change: For the first quarter of 2025, we expect revenues and adjusted EBITDA to be in the following range.
Speaker Change: We expect revenues in the first quarter ended March 31, 2025 to range between 17 million and $19 million.
Speaker Change: We expect adjusted EBITDA loss to range between $2 5 million and $4 $5 million.
Speaker Change: For the full year of 2025, we expect revenues to range between $85 million and $100 million.
Zee: That completes my summary, I'd like to now turn the call back over to Zee for final remarks.
Zee: Thanks Bill.
Zee: As we look ahead I can say that the industry still faces headwinds, but our track record over the past year 2020, full makes us believe that robust portfolio solutions.
Zee: Allows us to mitigate the industry end market pressures better than others.
Zee: As demand for our solutions continues to return we expect revenue to increase steadily throughout the remainder of 2025.
Zee: After four quarters of sequential top line growth. We believe we have enough visibility towards what's ahead for the company to carefully provide an outlook for the fourth quarter is ahead of us.
Zee: We anticipate that our growth really revenues to continue to improve throughout 2025.
Zee: We firmly believe in the goals prospects of our business and look to us for providing additional updates in the coming quarters.
Zee: With that also.
Bill Roth: Bill Please open the coastal Q&A.
Speaker Change: Ladies and gentlemen, if you have a question or a comment at this time. Please press star one on your telephone. If your question has been answered or you wish to move yourself from the queue. Please press star one again, we will pause for a moment, while we compile the Q&A roster.
Speaker Change: Our first question comes from Eric Stine with Craig Hallum Capital Group. Your line is open.
Eric Stine: Hi, Bill.
Speaker Change: Hello.
Speaker Change: Hello, So maybe just on the adjusted EBITDA I know you called out the charge X that a loss of $2 6 million can you just remind.
Speaker Change: When you previously guided where are you expecting or factoring a charge into that just.
Speaker Change: Noteworthy that at the midpoint, excluding the charge you outperformed by $5 million.
Speaker Change: Yes, correct in the last call, we did say in our guidance that the.
Speaker Change: The EBITDA guidance reflected an expectation of additional inventory reserves.
Speaker Change: That being said the amount of inventory reserve.
Speaker Change: Ended up being higher than we had initially.
Speaker Change: <unk> during that call, but we feel that.
Speaker Change: The the reserves.
Speaker Change: Taken as is.
Speaker Change: Both adequate and necessary as we move forward.
Speaker Change: And sticking with the charge I mean do you feel like this this kind of covers it I mean youre not expecting I mean, I guess from the guide it would imply that youre not expecting a charge in Q1 at.
Speaker Change: At least.
Speaker Change: Right. So yes, that's part of the annual audit.
Speaker Change: Obviously, a review process we have to.
Speaker Change: Look at the look at the balance sheet in terms of valuation and at this point with the reserve taken we felt we reserve 90% of.
Speaker Change: The energy storage solutions business inventory, we're left with a net book value somewhere in the around the ones that are $2 $1 million range.
Speaker Change: Which we think is.
Speaker Change: Adequate and justified given what we expect to sell.
Speaker Change: Got it Okay. That's helpful and then.
Speaker Change: Just looking at.
Speaker Change: Opex looks like it came down a little bit more I'm just curious as you think about fiscal 'twenty five guidance.
Speaker Change: And maybe where you are exiting the year I mean do you have I know in the past you've given some some quarterly revenue targets for cash flow positive and EBITDA positive.
Speaker Change: Are those things that you are able to update you on this call.
Speaker Change: Yes, certainly so in general we look to keep the cash Opex, which is looking at all the opex and taking out the EBITDA adjustments stock based comp.
Speaker Change: And.
Speaker Change: Amortization depreciation.
Speaker Change: To come up with an.
Speaker Change: An opex number that is <unk>.
Sub $10 million in this past quarter, it was around a little bit less than nine and a half there is going to be a little bit of lumpiness with Q1, where we have the annual audit and expenses related to that and then we have some ebbs and flows as it relates to some litigation expense.
Speaker Change: But we believe that.
Speaker Change: After Q1.
Speaker Change: We are able to take the Opex further down.
Speaker Change: And.
Speaker Change: Uh huh.
Speaker Change: And.
Speaker Change: With some assistance with the Opex being lower.
Along with.
Speaker Change: Kind of not having the continual drag of of <unk>.
Speaker Change: Reserving.
Speaker Change: Inventory, which.
Speaker Change: If you recall in Q1, Q3, and Q4, we had reserves and so.
Speaker Change: For primarily for the <unk> solutions product absent that our margins were mid thirties.
Speaker Change: Q4 was actually 40%.
Speaker Change: So taking that forward.
Speaker Change: Our outlook for for breakeven EBITDA is more like $25 million to $28 million.
Speaker Change: At that mid 30 to high 38% gross margin range, and our guidance of $85 million to a $100 million.
Speaker Change:
Is.
Speaker Change: Eight 5% to 15, 5% sequential growth.
Speaker Change: Which is fairly consistent with what we've delivered thus far if you recall Q2 was about 30% in Q3, 12% Q4, 'twenty one 3%.
Speaker Change: And so within that range.
Speaker Change: We expect second half profitability.
Speaker Change: Adjusted EBITDA basis.
Speaker Change: And you can you can.
Speaker Change: You can see that.
Speaker Change: At the low end 85 that would suggest somewhere more like late Q3 Q4, but the high end that could be Q2 Q3. So if you want to take the midpoint of the guidance.
Speaker Change: We would we would still expect to see EBITDA profitability and.
Speaker Change: Second half Q3 to be specific.
Speaker Change: It would be based on.
Speaker Change: Our business model going forward, which is.
Speaker Change: 20% to $28 million with mid <unk> margins.
Speaker Change: And that's what we're tracking to and that's also what we're we've been delivering.
Speaker Change: These past two quarters.
Speaker Change: Okay, that's great. Thanks, a lot.
Speaker Change: One moment for our next question.
Phil Shen: Our next question comes from Phil Shen with Roth Capital Partners. Your line is open.
Phil Shen: Hey, guys. Thanks for taking the questions.
Speaker Change: First one is on the 25.
Phil Shen: Guidance.
Speaker Change: Can you share what you expect the geographic mix to be.
Speaker Change: I know for Q4 it was roughly.
Speaker Change: Two thirds EMEA and then.
Speaker Change: Americas, 27% and then APAC nine.
Speaker Change: Would you expect that.
Speaker Change: Maintain as we go through the year.
Speaker Change: So the answer is in general the answer is absolutely yes.
Speaker Change: In the 65, two plus percent for EMEA.
Speaker Change: And in the 30% give or take four.
Speaker Change: In North America.
Speaker Change: We've seen as I said before we've seen an increase in those two.
Speaker Change: <unk> also in the last quarter.
Speaker Change: Okay. Thank you and then in terms of.
Speaker Change: EMEA.
Speaker Change: I think on the last call you talked about the top three countries being Germany, Italy and the UK.
Speaker Change: What were the top countries in EMEA for you.
Speaker Change: Q4, and then as we go through 'twenty five.
Speaker Change: What would they be.
Speaker Change: It's pretty much the same in Germany, the UK and Italy.
Speaker Change: We have not seen any recovery in the Netherlands as an example.
Speaker Change: We do see some interesting activity in eastern Europe, but the main the top three got countries.
Germany number one in UK and Italy.
Speaker Change: Got it and.
Speaker Change: And so what is your outlook for each of these countries overall, our census, Germany might be a little bit flattish.
Speaker Change: I think wood Mac with sharing with us and our recent webinar that it could be.
Speaker Change: <unk>, 5% and 25.
Speaker Change: After being down 20% and 24.
Speaker Change: So.
Speaker Change: But they do see Germany being down significantly in 2006, and beyond so with Germany, being such a big segments or kind of slice.
Speaker Change: How do you how would you expect to navigate that maybe you disagree with the woodmac.
Speaker Change: Team as well so can you share the outlooks for these countries. Thanks.
Speaker Change: We actually see Germany, as a robust market.
Speaker Change: And it continues to be strong for us.
Speaker Change: The indications we're getting from the distribution is that.
Speaker Change: At the level that we had been running.
Speaker Change: And an increasing Dave maintained that they see the same continuing for the rest of the yield for us.
Speaker Change: And also the other side, which is also in proceeds for US is U K U K is really coming very strong for us.
Speaker Change: Great. Okay. Thanks, and then in terms of the U S outlook.
Speaker Change: There.
Speaker Change: Ben.
Speaker Change: There's a big debate on power wall, three and the ramp up and how that can take share from.
Speaker Change: Inverters and storage companies.
Speaker Change: So I was wondering.
Speaker Change: Is there an opportunity for you.
Speaker Change: Two.
Speaker Change: Per your.
Speaker Change: Optimizer is with.
Speaker Change: The internal power wall three and further.
Speaker Change: So.
Speaker Change: Is that.
Speaker Change: Is that something that is working well now and is that an opportunity for you I see with the section 40, AE rules that require a separation to get the domestic content adder for solar and storage.
Speaker Change: Like.
There could be some.
Speaker Change: Something there for you guys what are your thoughts.
Speaker Change: Yes, I can tell you we have seen an increase in requests from customers to go was the power III to use it with our board.
Speaker Change: Product.
Speaker Change: And so we are paying attention suite and we are doing our best to make sure that we obviously complying we comply with Tesla to support it and we do have a good number of installations delayed which fell asleep. So we know that.
Speaker Change: In the market is actually working well.
Speaker Change: And we will see how it continues.
Okay. So.
Speaker Change: Are you being paired up for with your fire safety.
Speaker Change: Device or is it more your optimizer or actually to optimize us actually the higher priced unit.
Speaker Change: Okay.
Speaker Change: Are you able are you qualified to work with the Tesla inverter only.
Speaker Change: Product.
Speaker Change: We had been installations, you mean, the power tool, yes, no meaning Tesla also sells an inverter that is so okay, orange and say, okay. Yes, Im wondering if youre able to be matched up with them.
Speaker Change: So the answer is yes, we can.
Speaker Change: The optimizer.
Speaker Change: Okay. Good.
Speaker Change: So.
Speaker Change: That is maybe an opportunity now that there is no doubt.
Speaker Change: Section 48 requirement separate so on storage again for domestic.
Speaker Change: So great and then shifting can you share what you think.
Speaker Change: You've talked about the predict plus and the opportunity there and thats growing for you.
Speaker Change: Most of your business historically has been DG distributed generation and so when you think about your revenue mix for 25, what is the split between utility scale solar and D. G by guess.
Speaker Change: Utility scale solar is a very small percentage, maybe sub 10, five ish or so but I was wondering if you think that can grow.
Speaker Change: Much bigger percentage near term thanks.
So as I said in my remarks, we have seen an increase in large scale installations.
Speaker Change: The two we mentioned was the 142 megawatts in Spain.
Speaker Change: Used 100, thousands of <unk> devices, and we also announced.
Speaker Change: Another very large scale 97000 devices in Brazil.
Speaker Change: And we've not given.
Speaker Change: We released any information on assistance, which RMB 10, 15, 20 megawatts and above we do see an increase.
Speaker Change: In demand and requirements for those larger systems.
Speaker Change: I don't want to yet predict percentage wise of the total but I can tell you. It is becoming a more significant component for us and this is true not just <unk>.
Speaker Change: In the U S and Europe, we have seen.
Speaker Change: Most of our installations in Asia Pacific the majority.
Speaker Change: C&I and small utility scale systems.
Speaker Change: And these are direct sales rates not through distribution.
Speaker Change: The majority of our direct sales, sometimes we do deliver to the distribution, but the majority of our direct sales.
Speaker Change: Okay, and then is the margin profile of the direct sales comparable to your sales into distribution or is it.
Speaker Change: It's lighter given the volume decline so what's beautiful about our product team is that it's the same product that we sell to the residential and to the allowance systems and our pricing is not changing its the same actually we've kept this slice of the unique.
Speaker Change: Equal for the last four five years, we didn't change it.
Speaker Change: We didn't flow of the slides to sell products.
Speaker Change: Great. Okay, well look forward to following that story as well.
Speaker Change: Thanks for taking the questions I'll pass it on.
Speaker Change: Thank you one moment for our next question.
Speaker Change: Our next question comes from Sameer Joshi with H C. H C. Wainwright your line is open.
Sameer Joshi: Hey, good afternoon.
Sameer Joshi: Many of my questions have been answered, but just digging a little bit into the gross margins.
Speaker Change: Bill you did mention.
Speaker Change: Once at one of the questions that broaden your fourth quarter gross margins were over 40%.
Speaker Change: Bob.
Speaker Change: So going forward.
Speaker Change: Do you expect that level of margins, because I think youre guiding to mid <unk>.
Speaker Change: During the commentary as well. So just was wondering within 40 was sort of because of some kind of a product mix or some other reason.
Speaker Change: I think between $35 million 40 is where we're tracking.
Speaker Change: One quarter doesn't make for a trend, but Q3 again Act reserve was $36 five Q4 ex reserve was 42.
Speaker Change: So we are.
Speaker Change: Our trend in.
Speaker Change: Our products that is.
Speaker Change: It's set up for that mid <unk> mid <unk> mid to upper Thirty's.
Speaker Change: Figure and so we're comfortable with with.
Speaker Change: With that range.
Speaker Change: The the.
Speaker Change: On the inventory reserve that we had to take over the past few quarters.
Speaker Change: And have dampen that and eliminating uncertainty around that.
Speaker Change:
Speaker Change: It helps helps too.
Speaker Change: Better explain what the underlying margin should be like in and that's what they that's where they are.
Speaker Change: Understood.
Speaker Change: And then larger picture yoga and guidance for 2025.
Speaker Change: And.
Speaker Change: Maybe we can understand the <unk> guidance, you probably have good very very good visibility on it but for the year what is the level of your confidence and.
Speaker Change: What are you looking.
Speaker Change: Got it.
Speaker Change: When youre looking at this a buildup of any buildup.
Speaker Change: Yeah.
Speaker Change: Yes so.
Speaker Change: We've got four quarters behind us here of sequential growth.
Speaker Change: Coming out of the downturn in Q1, we had six 5% growth.
Speaker Change: Q2, 29, 6% Q3, 12, one Q4 'twenty one three.
Speaker Change: So we're giving.
Speaker Change: Conservative, but realistic range here.
Speaker Change: Our low point of $85 million being eight 5% sequential growth.
Speaker Change: Up to $100 million being $15 five so if you just look at what we've done over the last four quarters.
Speaker Change: You can see that I think we've done our best job to incorporate.
Speaker Change: The highest probability of outcomes in.
Speaker Change: In 2025, and the book of business continues to remain strong for us and so.
Speaker Change: We've got confidence that.
Speaker Change: <unk>.
Speaker Change: But the range, we're providing is a good range.
Speaker Change: Got it and just one last one.
Speaker Change: Is there any impact the likely impact of tariffs that might materialize.
Speaker Change: Over the next few quarters that would impact your margins.
So that is a you never say never question, but.
Speaker Change: We moved our production.
Speaker Change: For the most part a lot of it to Thailand.
Speaker Change: Back in 2017 18, when we went through version Trump a version one <unk>.
Speaker Change: We have not had any indication that any of our products.
Speaker Change: Would be targeted.
Speaker Change: In any way at this point.
Speaker Change: So.
Speaker Change: Best I can answer is that way.
Speaker Change: Got it.
Speaker Change: Thanks for taking my questions and congrats on the progress.
Speaker Change: Thank you.
Speaker Change: At this time. This concludes our question and answer session I would like to turn the call back over to Mr. <unk> for his closing remarks.
Speaker Change: Thanks again, everyone for joining us today, I, especially want to thank our dedicated employees for their ongoing contribution as well as our customers in both the continued hard work.
Speaker Change: I also want to thank the investors for their continued support.
Speaker Change: Rachel.
Thank you for joining us.
Speaker Change: Thank you for joining us today. Thank.
Speaker Change: Thank you for joining us.
Speaker Change: One moment, we do have another person who are queued up for question.
Speaker Change: Our next question comes from Gus Richard with Northland. Your line is open.
Gus Richard: Yes, thanks for asking.
Gus Richard: Thanks for letting me ask a question, it's hard to be a five o'clock Charlie.
Gus Richard: Just real quick on the gross margins.
Gus Richard: I think thats a record for you all and I just was wondering what drove such strong performance in gross margins in the quarter.
Gus Richard: There's a couple of points.
Gus Richard: We continue to <unk>.
Gus Richard: Improve our cost and our product and so a lot of work continues to go into go into.
Gus Richard: Costing down the cost of the product in and and we.
Gus Richard: We continue to expand margin and Thats, just a continual process that we do.
Gus Richard: We've introduced the acts as well in the X provides a very healthy margin.
Gus Richard: And so the family of <unk> four for us.
Gus Richard: As is.
Gus Richard: Just on a variable basis very attractive margins.
Gus Richard: And so when you get a quarter, where youre selling most of most product as these <unk> youre going to get the high margins that youre seeing here.
Gus Richard: Got it and then.
Gus Richard: You've recently signed.
Gus Richard: Got on an approved vendor list.
A large company.
Speaker Change: Company and I'm, just wondering is some of the visibility that you're getting just channel fill for that customer or.
Speaker Change: I'm, just just wanted to sort of wrap my mind around.
Speaker Change: The visibility for the full year, given how dynamic the environment is.
Speaker Change: So.
Speaker Change: Our visibility I guess, if we talk about EMEA is coming from the three countries I mentioned with the very strong distributors in various sizes and distributors do well.
Speaker Change: I would like to this confidence as far as the continuation.
Speaker Change: We have seen also an increasing footprint in the U S.
Speaker Change: No we did not rely just on this last quarter, we signed even though it will be a contributor.
Speaker Change: Both <unk> and continues to grow additional footprint within our offering.
Speaker Change: But then but my point is that the visibility is not just based on that one.
Speaker Change: Got it and then just.
Speaker Change: Last one for me in terms of sell in versus sell.
Speaker Change: Sell out in the <unk>.
Speaker Change: The channel can you just comment on what you see geographically.
Speaker Change: I can tell you that.
Speaker Change: I believe that 100% of all the orders we have received for the last two plus quarters.
Speaker Change: Brand new into inventory, which is getting depleted almost in no time. So we don't have much left over or any additional inventory in the channel.
Speaker Change: Okay Alright, Thank you for squeezing me in again for being late.
Speaker Change: Okay.
Speaker Change: Most welcome Mr. Alon, where you are finished with your closing remarks.
Alon: Yes, I am okay.
Alon: Well I just want to thank everyone for joining us today for <unk> fourth quarter 2000 towards four earnings Conference call. You may now disconnect and have a wonderful day.
Alon: Okay.
Alon: [music].
Alon: Okay.
Alon: Okay.
Alon: [music].