CRNT - Earnings call transcript Q4 2021

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Operator

Welcome to the Ceragon Networks' Fourth Quarter and Full Year 2021 Earnings Conference Call. At this time, all participants are in listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Maya Lustig, Head of Investor Relations for Ceragon. you. Thank

begin. may now You

Maya Lustig

you, operator, by Ran I joined morning, Ceragon's and Arazi, Ceragon's good Doron and Financial everyone. Chief Chief am Officer. Thank Executive Vered, Officer;

I Act Harbor statements within amended, of Reform meaning this Securities start, XXXX. Before as note of Securities XXXX, provisions and the Private like Securities amended, Litigation that forward-looking information as and of that the we of constitutes the call would of Act includes Safe XXXX, the the to Act Exchange

Ceragon to, Although can uncertainties reflected was but factors not release cause future detailed are XX-F, will include, differ any we that not on that are Ceragon's that may will Securities detailed in such materially Form based upon today, that that the other with Exchange and numbers. any Ceragon's forward-looking These most any there Also, that public and should risks any from believe statements expectations recent forward-looking statements to affect or and assurance be point in the certain to expectations forward-looking the may material. represent of reasonable give our or events uncertainties our in to non-GAAP from our Such could Commission. anticipated. there do other specifically statements assumptions, will Annual would results be no Exchange date. can those that relied filings not and but they the today's risks, and Securities Such as Commission's obtained Report predictions published we available on so. as statements filings website Ceragon's be website deviations from as risks no and results, accurate. views to Such limited be at Ceragon's and at uncertainties further in assurance and the and upon do obtained press call our results, be earlier our such also involve it made to of www.sec.gov, future include not only in as elect be subsequent be prove as these obligation future, are at forward-looking update disclaims are of www.ceragon.com. may representing views and they day purport statements

reconciliation a and see the between the I will attached issued Please please today. release GAAP the table that For press call results, non-GAAP Doron. ahead. over earlier turn go now to to was

Doron Arazi

with a good success morning relatively in and at end the challenging Thank delivered revenue had everyone. our world But you that many range to projected end the our year. challenges good XXXX. and the you, to high of pleased revenues were efforts Maya, highly business overshadowed by $XXX a best we share experienced We delivering I'm million. at in annual

disruptions, previous calls, They in chain ours. supply mentioned increased As global our shipping I component to led bottlenecks, many the and have rattled shortages, including industries prices.

impacted As XXXX. such been financials have our materially throughout

X% around market, It these been for Our for We came that gross was turbulence position gross in quarter weren't at our but belief the in it if maintained strong our would higher. margin XX%. is such it a the industries, margin our cost. fourth strong have

and in looking competitiveness to will an ways of products improve see are crisis component to we half looking without on We the will Looking compromising the then, new view. the down Until and we eventually come cost into XXXX. we quality optimistic ahead, believe and of improvements performance. overcome have shortages our second

shipping all costs. This our our also through expansion are is working part on margin delivery of strategy. We optimizing

all track the non-GAAP we on QX, to with have a expectations Looking been basis. at pleased our to for our income the that overall financial am down I way on operating results report

for to with market regions, continued weren't our the X/X for and XG. bookings. a on from last XG. years, very would these second APAC. best-in-class at elaborate came majority XG if three microwave fact been certain come by higher millimeter two than in business mostly we our Ran on our is over in outdoor, have this That expenses. we for XG that America, win the In our breakeven a year, further. of I'm bookings degree the in all and focusing of up expect financial segments. XXXX, Europe, to pleased fact, in expected business to In all made said, domain wave This of we from In it growing half North will especially XXXX fast, to

don't Our suite the the number market. new our ended short recent great and increasing fact selling passed year quite orders POC’s an quantities of of with especially a the Tier equipment. prominent We relative time this with IP-XXC have engaged available in the frequencies is and all and players as we and given significant IP-XXE the products achievement, IP-XXC yet. launch and the SDN with This others that given market We IP-XXE Xs. such since made strides trials

that share Site provides our to Disaggregated the and opening pleased Disaggregated the with core Routers, network I'm domains, us the OpenRAN with trend Cell era Beyond towards to many XG is strong. you to opportunities. Wireless From Transport,

layer parallel, software as best-in-class for routers. IP radio-aware Transport partnered are position delivering In and site best deployment. IP-XXFX software as we Through Wireless In available curve. uses elements with gateway the SW well hardware. of is Our our architecture routers. It open IP-XXFX routing capabilities industry's ahead and cell generally product Infusion. RAON we strategy disaggregated solution. breed the Disaggregated routing just launched is partnership now this the cell us an and site The for hardware X with of transport the we QX, Disaggregated software disaggregated of first decouples wireless sale the that

a elements radio of way providers and I'm Beyond open maintain to as cell so in and provides accelerating solutions. well unit. a award integrates into that, gives router also deployment our upgrade and our the communication worldwide. that listed networks They essential The Ribbon testament you $X been has Compliant awarded by providers, us standards The the community wireless XXFX faster, of to XQ with its edge. and whose more is IP-XXFX effective a mover DIP cell our DIP diverse only technological the billion is IP-XXFX proud for global industry's of cost the site received a XQ grow to share market our Telecom to and based do It and of scalable technological has it so mobile IP-XXFX disaggregated transport deploy sites. single high same connectivity new also our passion sites transport leadership, advantage two and is DIP indoor advance product service markets. quality Project the we that site private as prestigious exchange. is Infra Requirements understanding and goal to to service on in direction need cell solutions Ribbon us routing share and first innovation, to the billion this the $X helping equipment in is wireless the far. adjustments make timelines IP market and

transport us companies complexity, more managed brings offering. to more our their turning to are with more network XG manage wireless services and As

engagement transport us networks our later. which provide private to and full smaller with One as with from recent Globacom turn well, elaborate either I large While network. operating them the or example benefit services will this, to is companies on their carriers partial most for

We have in so. of XXX presence XX a strongly plus them countries,

We customers the served throughout XXXX have than more years.

our on for experience top tools, customers, existing you to one-stop-shop as ones. and we see, well capabilities resources and So, technological become of new a the our software have the as

lumpiness leveraging software customers, our managed our results, Our decision to and the tools, recurring margins. increase our us with focus visibility, offering, business improve our more gross strengthening on relationship revenue, reduce strengthen will services our giving our of our

is expect our about business for and well mid our range We optimistic traditional growth through strategy we With million market, expanding of have phase which with Directors. now $XXX services to revenue challenges comprised increasing the strategy, faced our our expansion. main as and markets, Board a XXXX cell in is into site $XXX new margin of us designed managed as our million. to we of XXXX, just This new routing ratified and long-term more guide such view, as business, the between to

now for us. year bit America, although in per bookings overview a than you a an North was in lower QX give were record region. XXXX Let In previous me ones, over

and Our pleased win I'm than the customers of XG to report successful design continued tests far. been with QX, more so lab have booking generated XX% X for customers In operator region. our our Tier that this

We expect the process year. during of half the the to continue first testing

in North America. We infrastructure markets investments ahead, North to expand significant rural to federal see critical the region's see networks grow. we Looking America,

in This this COVID healthy believe us. future strongly performed strong In year expansions. as saw annual network We had leverage of that since We to surpassing XXXX. our is basis end, are QX industry we in restructuring post and organization an to was developments recovery XQ demand is the quarter Our sustained upgrades for and bright. India goal continued. record very our a India, these for On we a region.

As finished leading another two region, we We XQ in corridors and we be with strong wireless and X will successfully the are developed radio quarter. Tier national provider infrastructure. in their TV transport there the network a PoC tenders In renew operator. Italy's RAI won We had WAY, network maintain with Europe, to RFP. to participate IP-XXFX

in trials with another operator bookings. eight about terms year was operator. IP-XXFX look a we annual The in strong, XG confident wins. basis, When trials years feel SDN We third our we XXXX activity and in and will on of undertaking the future these is Europe be an a with of surpassing record at last continent European all

challenging. Our In variety customer we That a America a that bookings generated pushed remained Mexico who to this a In to of we different the Latin XX% business win new building difficult future South momentum, signs economic potential of than QX environment solid XXXX new impacted decisions evaluate too pipeline Latin for All was region. of there were a XG challenges macro partnerships. of XXXX. while IP-XXFX the a customers experienced expected rest America, annual more XXXX. by The for in is including APAC, year. are was Cone big The crisis. the adversely said, have continued our Many said, design COVID.

are There Mexico Peru. of government divide initiatives also We between communities. digital a to solid the built different in close projects funded and pipeline

a strong dollar part We are from million. a multimillion X We second In with received deal Globacom, received doing we such operator $X worth We telecom X projects. booking operator. take Tier Nigerian POs half. to Africa, and Tier best a in a our for had very signed

solution Globacom network. as well We as with be Metro, capacity high long that providing the areas, a customized rural covers will access haul

reach their We further subscribers quality to expand enhance existing experience, will help their market also them to but not only grow their of to share.

will to now that, health well the Deployment We for be Services with support. and providing Ran? monitoring let Services Managed as them Ran turn network quarter. call first me over as for also their With the discuss the to the financials of year

Ran Vered

To referring mainly be Thank you, Doron the results, to non-GAAP good and understand will everyone. help morning, I you numbers.

non-GAAP book-to-bill XXXX we coming saw these For regarding ratio our reconciliations release. see trailing more today's we X. look at Europe. we to you and mentioned, months, information a press of strong financial XX bookings strong measures, of India measures, QX Like Doron from refer When including above we the use during

This actual now highly year. X.X% was compared we ourselves Let the QX found numbers in. quarter review Revenue $XX environment million in the million, were up challenging the despite achieved with with $XX.X last you. for me

We fact most that achievement, were of and our customers' fulfilled. proud of demands are the this

in region region. strong demand line strongest main we terms for in our deliveries in Our quarter for with reflecting in are India, seeing the was this customers of the the revenue region and ongoing

Our our quarter. Latin for second fourth and customers progress customers of had strongest deliveries X we Colombian quarter thanks region the in revenues to we for in XXXX. made operating in Tier March America, two the mainly whose with agreement terms the the We was back announced XX% deployment above

a we the challenging with profit $XXX For a such fourth XXXX. XX% This to margin times. our million, from industry basis of up the demand gross experiencing XX%, were similar $XX.X quarter million, ability Gross XXXX. the us even during were non-GAAP are our fourth to keep almost reflects strong of almost for up giving quarter non-GAAP the revenues on year

for wasn't it shortages, would our surging X% around if costs, gross margin mentioned, component been Doron higher. have the As shipping and

XX.X% to the margin the gross in year, compared For full XX.X% non-GAAP was XXXX.

non-GAAP compensation ongoing lower basis and developing incurred than XXX,XXX the country quarter, we variable come administrative fourth non-GAAP we the large We Research in basis earlier for our given $XX macro on on with are a on other for still a were $X.X expected cash Financial the for achievement, an million expectations. collected quarter in COVID. expenses non-GAAP on basis basis we QX and fourth in. Operating expenses expenses basis $X.X quarter on quarter repatriation were Selling have reflecting million compared a million, $X.X QX XXXX. especially with line the travel marketing environment with and were this development a and $X.X customer significant quarter In amount are as million. that from for a expenses, expectations. million, slightly of our pleased General fourth in in fourth Israel. reduced to a for challenging to financial were fourth million, to the repatriated similar and quarter fourth the expenses the non-GAAP were than the $X.X XXXX a expenses

exchange is something QX, favor can't or addition, was in In not control which the in we forecast. rate our

fourth tax In a and couple of our basis for this $X.X for asset for and basis. the yearly in with big the minutes was full ongoing line on year a now our QX, off expectations. of tax tax as would $X.X This Our caused has an our a quarter expense spend net numbers in income is GAAP on a to our on wrote million. QX we like in line I drop EPS million. GAAP

why. explain me Let

in in assets taxable balance If sheet. result to indication anticipated as of the in you back $X.X well to strong million reflected tax strength. in continued meant back for line, XXXX, in a tax primarily in years. the record following tax our need on that income against as we tax utilizing expected were our of recorded our expenses a benefits higher GAAP an the of following was This Israel also due This we recall basis recall, were years. on the NOLs our as the to day, performance expectations the income This

However, the guidelines, government three since was GAAP GAAP off tax the on we we quarter had assets. basis, now on or loss years, past basis $X $X.XX Net share. a a to for in net the recorded per write million according to the losses diluted

a the balance as to our The at up our the of result We as $XX.X million, at key customer for stock lower of XXXX. $XX.X try long to as orders sometimes items shortages. and increase well to As stock environment, from end the reflects was of inventory ongoing end million current XXXX lead levels of sheet, our component the inventory and level, items need lead keep increased items the at but arises. strategic given long need the

of million, end are $XXX.X trade from $XXX.X up receivables XXXX. now at Our at the million

in was Net Our in DSO provided financing activities and as XXXX. quarter for XXX was cash at the used operating $X.X now same stands investing in days, for QX activities fourth the million. quarter million. cash fourth Net $XX.X

demand operative continued expect continue uncertainty. we to strong Looking alongside forward,

believe Although full of positioned maintaining term are control opportunities. advantage good well the to situation we that take remains and volatile, are long we

We targeting XXXX. in growth are revenue

disruption, global between with will calm Assuming component chain our improvement gross revenue $XXX and down, yearly to the shortages, we margin. to shipping billion supply $XXX expect be billion issues in

long term margins remain Operator? Our call I'll the range now for gross to the XX%. non-GAAP With XX% of open questions. that, in will

Operator

line the of today [Operator from Needham. Alex Instructions] first Alex, comes you. go Our ahead. please from call Thank Henderson

Alex Henderson

on XXXX. first the Couple for of is questions, the book-to-bill

like granularity their us unusual a was hoping as most little are bit what it you well. bit backlog characterized granularity could little I "strong" provide yearend giving You a more of because as companies more the and looks to circumstances

Doron Arazi

situation some we obviously gives compared the XXXX. our and our would overall just this of of confidence backlog say the delivering level beginning year, us has higher increased, I to if that in in

Alex Henderson

right. All

of the half? growth you second how half bit you the expectations by think you the quarter, more a be saying the question It's you what are gave Are therefore ask half by do over the you conditions for you in your hard year, growth to year relative full progress? by end constrained be What exactly? give on in I'd is it's us first higher sense the supply like to but the of end that mean year you're supply you X% I now the us that could course a of will you'll is, back imprecise. outlook, first better that And to and of understand. Your no expecting year to language the lower of The conditions the commentary mean in still normalized? XX% qualification or little year a growth? saying in with constrained give growth can becoming to you assume normal supply little us the through first any

Doron Arazi

I answer during the we to to about resolve the try answer year. we obviously issues are other very supply QX, QX, give that will sort supply the chain vagueness resolve component some our that turbulent be had are to about we chain still will and able there specific unclarity some were the of Ran of you and or for an while is creates issues able yet. I And cloud environment to turn then projection over not to QX. The more component

are in, challenges year I so during enable in would Said reliability deliver far. what than so the and we that regular of with level that faced more and that timelines. upcoming us are the the and on the say the Now, commitment back to will have half components will steadier these of we saying of that supply [ph] that need of, of we prices that put be supply, cover the severe-ness second a messages we believe we of we smooth and cautious the this have that, would it us become and start we've I we've up different current will from easing for two And the or not believe the to and during seen of approach, the probably orders our the based therefore, it's say year. second will to for to taking coming seen way quarter crisis far components that terms prior the half vendors, flawless

Alex Henderson

you can the clear, that there distinction. in year? But half just back that the an you issues year therefore back to what supply and get you parts of the constraints no assuming are backlog you in are half is of It's the be or no assuming need, important

Doron Arazi

have items We be the don't assume on able six for concerns confident the the with, believe will supply there year. We we and that feel based on part current probably no on the products our that be that components second challenges it demand we that of us will the and resolve more these months second beyond within to the part. upcoming makes see

situation normal not the are It's back to to We on down bit. a part come second XXXX. a just of going

Alex Henderson

Okay, and floor one, Can an update last then are later. you additional on questions all. for in one us But the mention XXX queue I'll you give on your question product? get at IP-XXX the and I'll didn’t back cede Gig where you

Doron Arazi

QX. no our didn't there's we discussions because in to significant mention it Yes, relative change

not assuming itself by XXXX. forward the timelines productizing So chip In towards That chain hope discussions and the will end we ready on to of start to we presenting productized products or have of the the we'll we've believe chip previous are market or this XXXX. kept we of moving are to products that with and industry beginning my we supply will the parallel, and of by chip, start chip the said end as XXXX has be relative based changed announcements. that and launching the the these developing

Alex Henderson

back and queue. floor the cede get Thanks. I'll in

Operator

Alex. Thank you,

George comes next Our the Iwanyc George, from of today ahead. Oppenheimer. go question line from

George Iwanyc

and Hello, hear can Doron me Ran, you now?

Doron Arazi

Yes, George, hi.

George Iwanyc

Thank you.

grown burn anticipating up look backlog for following starting a guidance year, about little to actually or and move maybe relatively and flat being just the negatively, chain your in are on that expect supply inventory if be within you confidence down the the to able gives your backlog, you do or you range? when things have to you that’s change, and positively the bit So, some then where either you full the hand at you it

Doron Arazi

is the the strong, it, to even our that is of new for booking bookings. nature is but stronger booking new the at filled all, or consume as We backlog going not actually by least that you next of up be than this believe if orders year. First it year

expecting we us obviously we’re our but and all, consume all bookings. because in growth to business in going are So, deliver, but to this backlog, to see the expect in our customers

of be will the if we XXXX, or that higher. the So, look at our at believe you same end value backlog even

George Iwanyc

looks have activity the like XG in like or Are on there that you the of And design new type two wins. do either starting seeing, starting deliver that on to it what With have you Europe? you’re added momentum to you on North America you deliver actually base XG?

Doron Arazi

slightly as XXE reasons. for So, XXC it the increase depends than and we XXC on The just start, basically products and two we traditional are script, less demand for the as ordered such seeing on that are to that year the obviously move amounts obviously but we XXXX launch quite actually believe will a a as least and available XXE, these I than and since into more significant, strong further amounts the were that. at longer delivered said

that see obviously are yet not now regions demand of more or coming rollout. are First that started all, from starting have customers there rollout the secondly, potential some the XG more we because, customers and

it to with the until different procurement labs or the at been the and trialed sometimes not approval are the something field, in So, can of for the even underestimate. has the six X demand that, we and two of you kind time, and the in the markets. takes before especially when least our months, us elements months optimism that trails, XXE gives these combination nine world, of product XXC. operators you talking obviously final takes circles very working It Said start the about prominent about Tier is increased get with

launched process. we our I North they’ve lengthy Europe, second at we the a seeing just start and a believe trials of product that robust will are is and lengthy In the a least that's part longer process. within will which version actually second looking that my couple initiated into America even and they of that more orders in IP-XXFX, from But brand-new perspective, for it's come a months and the first XXXX. the very a So, good just future. experienced for will version be it's a sign

George Iwanyc

more one question Doron and you. for Okay

services the you quickly On does disaggregated you're with customers putting amount that driving meaningful to with of them? becomes the how managed recently and maybe may routing, revenue the selling incremental business opportunity been mix? a new efforts not think of in, to have or an overall this you part that your reengage that some And either do offer

Doron Arazi

generally that of us I tell in I router separately. refer cell router services to all for are domain. think and open domain, I speaking, site lot this the can the that will a interest. you are opportunities we In managed the site getting cell

Some of from coming is this interest existing customers.

Some new from we have discussions. prospects of list is nice very potential that we started of prospects. And have it a coming

more Some are less of advanced some of advanced them stages; stages. in them are in

this have don't them some take expect I to business, do nice are very the very, ramp-up will and trials, move coming but some in us from that have trials, booking. in have It I a time. finished stages. want they XXXX will significant to and a amount of us them of of to Some revenue think next

basically customers, think for I the our deployment. their more that services, the managed and see talk transport to needs the more to we after the run network tools As more sophisticated existing we with operate

with have whom the nice we nice fully, the list a very on there existing or a have customers we same already of engaged customers. list at hand very new token, is one So, partially of

business very trials the of the And just a and Some quarter I us months, finished us. them are have in multimillion they expect quarters. upcoming happy in to two with few or dollars for we get

there in first the position huge. network we a and but Some in of are to private the the domain, them win also potential are win, is

to So opportunities I will we would generally announce speaking, speaking, combination. see be will a we I some obviously generally feel existing them. announcing that the when but say, in there's wins that able more, it's with we Obviously, coming customers, details, from many be But new start prospects. is these

George Iwanyc

with Doron, right. couple And to just of up a you. questions All finish

you maybe you about raising the the And this XX%, on success margin side, margin talked On pressure type with prices some gross your much having year offset below to side, of of area the returning gross XX% in are you the do XX% confidence term, relief any own expect there? to seeing long XX%? to maybe

Doron Arazi

challenging, say shortages, relief toll I the the And past we've this few very me with, first which gross is and would quarters. increasing In succeeded to coupled In let it's margin a our So prices actually chain going first the the would for We been contribute more the some in and detailed of the I our of in to have have answer supply successful. a customers. some Yes, but component cases, increased specific XXXX. question cases, plan the we quite about prices launched customers. to us some per for region. some of for been say,

constraints, my if remarks, I As prepared with margin by X%. we in have would our have been mentioned been these would better gross

in So gross ease would in X% that expect some XXXX. gross ease to I say about I the do XXXX all margin and of this XXXX. compared have at to I expect margin. don't will better

George Iwanyc

the on question Great. OpEx side. is last And my

it go basis and and you do market hiring $XX OpEx on that the all you're see well, seeing With your year? engineers having the how to as million up are through impact FX a tight how and that, quarter attractive the do level anticipate a or quarterly you

Ran Vered

actually in the, relatively would represents QX that bit a higher little expect factors. XXXX of think I we because or what two say, I So

on the on although according do salary a bit foreign exchange is negative in we to forecast, second XXXX. engineers in here our expect has little the indeed past and Israel one that a it is months, First pressure Israel impact the on in been rebound a

OpEx the what expect to be we do or more and a XXXX have than average, than QX to to we on all, more in in in all So close little bit that. be higher

George Iwanyc

Thank very much. you

Doron Arazi

George. Thanks,

Operator

Thank you.

Please comes Our today Capital next Corp]. [Aegis the Rommel ahead. question go Dionisio line from of

Rommel Dionisio

Doron and morning, Good Ran.

Doron Arazi

Hi, good morning.

Ran Vered

Hi, good morning.

Rommel Dionisio

that You initiatives? the mentioned, take benefit the improve Ran, it impact some about -- -- Doron, talked that a help to margins about talked you is to reengineering something going will bit gross see those products XXXX that longer of of you was maybe or forward. factor Is or little a that reengineering could Thanks.

Doron Arazi

widespread depends It because this is initiative effort. a

in invested are of them and that need to immediately new Some time after terms the design. that relatively of enjoying small be

our So of this will margins also impact portion positively in a XXXX. gross regard, it in

Some much nice the obviously, answer to we into will the as a of expect of, very kind and well. is, gross XXXX gross so at a have that. redesign But bigger XXXX short speak, partially, initiatives to and this them are have partial profit obviously margin of on beyond and least impact contribution

Rommel Dionisio

Okay.

give you that your on America. -- about, During the could the prepared if plans North a I you were I just comments for rationale think restructuring the please? little wonder as us going you on could you geographies, a just through granularity talked in more

Doron Arazi

Tier private But particular the In was Tier had this to business Yes. on products focus America, basically our with on certain in fruitful a to degree, was yes, X we and some And traditional to networks. operators. a the the smaller primarily X partners North very partnership ISPs our focused operators. region sell

the don't Access strengths, fact while on a they to we continue a good obviously, and networks expertise want slightly X Tier in-house. a focus have for for this not one-stop Tier small if are we vendors core have been we private we a different capacity or we that strong managed to our say, people sensitivity it, very by actually do of terms network serve to unserved we don't them other the the target on the there. are using have private for throat with our so coming the either I have with solution a Obviously, and really part handle for also a what great services. that that ISPs going this, players focus is have that the we full unserved And doing I them also we And changed and that sales to choke with one the organization can that [ph] do win technical have have, and we they with places strategy vendors, has they to and business the we but partnerships X, from it's the market market high, can where strategy. ecosystem In in that in in of call believe the this seeking that, provide see coming regions. of that have would market Now so to knowledge, we the want will opportunity shop, networks one-stop-shop this also who would increase

Rommel Dionisio

Great, thanks very much.

Doron Arazi

Thank you, Rommel.

Operator

you. Thank

Our line ahead. question comes next Alex Henderson's Needham. from from go Please

Alex Henderson

X. of Tier your Can and the whether we you and Great, just -- X talking Cambium growing or is that relationship update questions. you business about through were networks on start couple U.S. thanks. private doing? -- that's how with A Since us just were

Doron Arazi

of month least in America North in because by Cambium, in with I'm and augmenting recurring partnership our collaboration light are basically, the with to almost actually and tuning in other say, would about we least strategy I every speaking we only they and our continue once this every customers great -- are relationship with having, in continuing their the see products our We cases, market. at fine a but and way intend also needs or month, of goals what and some strategizing we the have regions. at Atul discussions not

will We and their fruitful, is so are products, for our continue offering augmenting sure. partnership this with

Alex Henderson

well benefit them meaningful from therefore, Do business, that in RDOF and to acceleration strategy expect potential business? a to as see the of your capture as some you for RDOF here

Doron Arazi

is in between with answer is yes. thing short providing be partnership that longer The us the is about their nice -- involved don't services. our just the They to they between decided Cambium products. that want that answer want and partnership sell to The they've

provide, and And of sure continue this to that a into it and them that across with I'm further. tools, able therefore, and provide can is to very when they will we and with software opportunities are their services just come the we We expecting stream in reserves that robust customer, our seen customer and we couple the have strategy, such recently opportunities taking cannot where I getting we opportunities happens, end funnel, value-added the services. responsibility. many and the be picture a for have hope different we'll of with that the believe provide collaborate experience cases, And them

Alex Henderson

drive should stuff RDOF business. the Cambium Well,

that, that that drive would would base, also demand products your assume Excluding through channel? for I acceleration services that

Doron Arazi

it's my Yes. of true, further natural, in but part and for Yes, America... growth that's for that's North anticipation me,

Alex Henderson

will kick think do When you that in?

Doron Arazi

Sorry?

Alex Henderson

When think in you kick will do driver? as that a

Doron Arazi

more It's lot see let's part we the different of of towards I've asking a next your make filing grants. microwave for It's good and chance of for and grants. to time. ask of because this of forget, reseller process do just amount and the of happens process equipment increase that It's not applications, process, the year not I second to activities you ISPs second. not coming believe that seeing towards I a this is the probably that an amount equipment value-added a of go the business takes start a have decision filing part can and a within something we It second of unlicensed. seen XXXX. believe But for where

Alex Henderson

XXXX to additive Can rate point of it to in in a a more growth You mentioned times. meaningful percentage contribution is or a of it number growth? fashion? the add the growth it Is XXXX, a to XXXX service rate

Doron Arazi

And usually services baked the to beyond the projection. later increase is on. ramp-up our a I we in of into the kind is manage reflected revenue huge are traditional our don't that business aiming services, since in think

for beyond. So I and growth further a it's XXXX in think, buildup

Alex Henderson

the will be And gross Doron? margin benefit by or services hurt

Doron Arazi

customers. remotely provides tools can our that replace to by America, eventually that willing this our to for Remember, used and that be with sophisticated gross value come beings. also software And and just [indiscernible] in pay. assumptions It's for help managed to really not are Our margins. customers, services could are beings human human developed use to the software North cases the is showing Europe, countries bring primarily software value to

do all, gross we So that it believe will contribute our all margins. positively in to

Ran Vered

the same will view contribute to add just positively margin. Doron to gross that be But it the that on as I Alex, see

in a the will agreement. announced usually the months, months have I’ll nine have ago incremental I We been more, period, managed that over We some seeing say require U.S. pay services in first Although six or off nine months year ago the do think we provider. actually it time. investment to with

actually also margin. opportunities contributes improvement, to which positively the So we some engagement see this gross an see upsell, and also in we for

Alex Henderson

is Could your you in go margins talk swings about as forward? XXXX. we the the strong geography has into. of India that selling you're biggest in One gross of mix mix the been

Europe into in shift very both every think perspective and and had in the in much see higher-margin strong carry wins XXXX? excuse margins a U.S., higher and from XXXX me, I available. You've XXXX geographies we make take feature you and Will which to geographic mix --

Doron Arazi

of in past will North stronger in that the higher than the and business believe business America trend We continue. Europe, up and

fully make of chain unfortunately, expect, converted will of partially issues we consumed the the strong a or of Europe come yet case, North Just in for we America of down America India for to will because Generally and to part year. be be is gave. revenue was next in unless component us very three speaking, Europe converted actually, if the revenue the exceed we portion India our backlog guidance to supply are nice very we obviously, planning had we'll seeing growth in even we'll this the In bigger. you expect satisfied and be as or into the our not our see year do to the the the absolute regions a maybe bigger become in issues into due remember, and able to revenues both opposed as very, even North numbers just to go which will we that obviously

Alex Henderson

The a is Just completed? of couple quick that now Peru build-out, ones.

Doron Arazi

the held would about shortly, are to of at with impact on two be delays. some yet. finished the continue given to regions were And project, they other some challenges some in there. that the government of want Not I project due economy how to progress. due say basically this one changes Obviously, situation regions COVID very the pending us will COVID and that there government, There the and this with and the least also the is the to discussions follow. the the

XXXX. believe slip but probably ended not first will of it we the XXXX, that end yet, will into end up of it's towards half maybe also So

Alex Henderson

question, Europe, in Last say America. Latin in three floor. The I'll one IP-XXFX, Okay. cede trials and you the then trial heard I

that aggregate mean, expect U.S. little think of better or the disjoined? little so that it, and I trials for said totality them you half bit in in XXXX. the have that you I it's the a we trials a expectations of you trial are Is bit second feel of a your us if all can there, give

Doron Arazi

in talking it But operators this there Tier which are about slightly they we we don't product all, And the to different. yet actually are the in the by in plus, of list focused so trials the But not the what across significant in all Europe, globe. X in at I stages XG missed point, that exists. they are capacity. America introduced North -- expanding America, priorities, numerous talking are Asia, of already is We is is their of this were because a of region know we Latin terms seeing way, think, past, tens call any trials or one. trials. I the approach

Africa now. in even that think a there's trial I starting

Alex Henderson

trials thing? XX-plus So of tens of implies kind trials

Doron Arazi

Yes.

Alex Henderson

okay. Yes,

Doron Arazi

XX of We plus trials. list have a

able have so even Some for trials. of much them equipment were start because to we not didn't available

this are going QX are and in - up quarter in catch We we speeding intend to up, we

Alex Henderson

this impact of that pull it's it on it it's product I to ramps? points Thanks. does two the lot accretive margin of as well? what's And therefore, a assume other gross once your and last it line Just gross software your margins? products in Is question. -- One, a

Doron Arazi

would this is with is by be speaking, product by only third-party to we solutions. for an the market will give flexibility region idea not software much as expect more higher. serve all-outdoor region, be yes, we're connect seeking that And still is this can able mode region. of customers the future something margins contact that also radio the also higher buy indoor solutions one generally cost our So even radios and in that the much And analyzing to to potential unit gross the that, to versions, region Obviously, that split wear of and hopefully efficient.

Alex Henderson

Perfect, thanks.

Operator

We questions. further no Please proceed. have

Doron Arazi

we to in sincerely the that enormous contain revenues. these crisis our In creativity strong showed of times. me us. extraordinary they thank to We reiterate allow employees the the in for and endurance impact I XXXX, able enjoyed healthy closing, around were bookings and

same continued we in expect short to us demand optimism. While run, be the dealing with issues, brings the our strong customers by

share expansions run. market margin and expect in growth mid long the We and

bring forward reliable opportunities good Our communication equal a are I next for area. digital you. and whether world rural on in work everyone, an look a Have you people the updating capabilities goal in to they is or day, all thank around urban to create our further We setting call. to everywhere.

Maya Lustig

bye. Good

Ceragon Networks (CRNT) 7 Feb 222021 Q4 Earnings call transcript