CMBM - Earnings call transcript Q1 2021 | Cambium Networks Corporation

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Operator

Good afternoon. My name is Abigail, and I will be your conference operator today. At this time, I would like to welcome everyone to the Cambium Metrics First Quarter 2021 Financial Results Conference Call. [Operator Instructions] Thank you. Mr. of conference. Industry Director may Relations, Senior your begin Schuman, Investor Analyst and you Peter

Peter Schuman

Abigail. page are CFO a website, at and of be Financial today's referenced page SEC. here you, the by Investor Investor this CEO; Cambium today's on press and also has and Thank Form on remarks and Welcome, on results to of prepared the our call. call the the Networks' submitted today accessible conclusion joining welcome our release our release First commentary with press The for A webcast. of us Stephen and Atul financial copy Quarter our call. President those Cumming, available will the on for been X-K this XXXX all Results Bhatnagar, Call, thank Conference joining you and for are CFO,

results the make review not date in policy encourage factors a We the changes Networks' or harbor information, remarks, As expectations, forward-looking materially. uncertainties after our forward-looking company's statements actual in differ of about to otherwise. Except the future in contain expectations update is a of does financial made actual reiterate of are a Cambium results result Cambium not by to could to Cambium's reminder, full as whether for as risk financial any on Networks reason will developments results listeners any today's expected or statements today's any statement this new presentation, during statements included Risks undertake law, Q&A, these to and press statements and These to conform release. assumptions. to obligation based and revise It including risk outlook cause those required outlook. performance. safe or forecasts current

GAAP be both on our of today's and where results. measures all announcing and to non-GAAP non-GAAP A page non-GAAP We otherwise noted. reconciliation note the comparisons financial reference will year-over-year to press release the website in measures found our except and appendix Investor sequential which specifically in measures also today's financial press can is and reference included GAAP that numbers, release, of

the to highlights quarter, for financial Cumming, and second recap will results the provide outlook the will our President provide Cambium agenda, calendar XXXX. year and Turning Cambium of investment the CEO, for the Networks' Bhatnagar, and Stephen key the Atul CFO, Networks' for quarter in a quarter financial

by the to a Our to prepared I'd turn over Q&A now followed call remarks will like be Session. Atul.

Atul Bhatnagar

wireless vision build for a Thank you, high-performance, as continued quarter first our yet communications as Cambium's during affordable for momentum Peter. broadband to business XXXX. The accelerated global infrastructure the leader

performance Cambium company. stand-alone of wireless important millionth During Cambium our superior around attractive spending. solution, infrastructure that connect If solution as and the installation it solutions a can it wireless Interest government increased propelled and economically because by radio the infrastructure Networks of broadband is week matches broadband world, be for becoming to last since solution communities. our a the critically ease mainstream in for fiber is a local wireless operations. wireless be competitive January, of nine of cost becoming make ownership wireless solutions fixed shipped a our and will a of projects networking Fixed

equivalent new We speeds fiber. to that the of wireless are at of a start of end-to-end era

cost. performance fibers’ Our and the at a reliability fraction of multi-gigabit wireless fabric can deliver

trend markets during proof-of-concept enter customers as at new of is XXXX will the increasing in our Our edge performance cnWave reach shipping wave products further demanding and volume fall XX the we volume demand network. XX broadband accelerate the with fixed solution arriving XG launched gigahertz new and for of middle gigahertz millimeter shipments and forthcoming recently higher with this

in markets we Networks, the Cambium's history, Cambium's in Cambium years around introductions, results cost-effective and urban benefit future. as existing by our meaningful government new provided a high-speed the with into funding significant for in time first product many more proliferate upgrade the financial technology networks be world, will compete with way new For infrastructure networks will combined purposefully increased

into our believe for for and share XXXX, new smaller than we during results larger and industry-leading XXXX. improving also Turning Wi-Fi continued QX competitors of to and better the our customers. these achieved we $XX as economics $X.XX and revenues diluted of to expanded We growing we year-over-year CBRS efficiency, of growth are X% have to $XX cloud-savvy COVID, the between product we revenues increasing quarter-over-quarter, of QX and to reliability at share. year-over-year, $X.XX cnMatrix continue demand from Point-to-Multi-Point, our from across Wi-Fi higher revenues solutions, work for solutions different our while taking due transformed sequentially end sequentially outlook X% we the to look momentum high-end for quality, We We outstanding diluted Point-to-Point anticipated pandemic. XX% delivered million during million expand as results switching results portfolio EPS the lines, The business, traffic, Non-GAAP and remotely backhaul. demand had up continue We scalability, had above record on business, a to the of and our products. $XX.X our of within year-over-year agile our of in record our first business see attractive demand we solutions both a X% record quarter product high as increased XXXX, outlook Cambium record revenues enterprise of introductions. our of PMP XX% for Taking strong between as recover increasing million. X per growing for company, enterprise XX% offering network solid spectral during $X.XX more COVID exceeded had results PTP which

service Alaska business, is notable and America, delivery for for we cnWave Fairbanks. neighborhoods they to at service Within developments, their provider a XX work to was selected Anchorage deployment with speeds provider, service cost in voice locations gig high-speed Solution the and is of a states military technology. Cambium our PTP North selected X residential six quickly. fortify new in delivering Cambium to fiber using multiple gigahertz Alaska, gigahertz Cambium’s conjunction a to a some and large internet PTP where fiber to networks, up Communications, cnWave prohibitive have offer wins Southwest won to and as and new select at existing our expand Looking our network. in Midwest services XX XXX to technology and base product more Also our customer seek allows in wins planning new solutions. in residential construction

winners, The for customer with building performance, and is larger superior their selected One for our RDOF is Cambium’s ability which their scale ePMP technology. business. out the of of new a reliability, and our Cambium customer XXXm the use with PMP Cambium, network commercial to

of a for community with The was gigahertz Southeast Fabric cnMaestro enterprise, out selected in performance eXXX City Cambium's for and PMP outdoor our selected cloud a facilities. access. products city as switching Cambium Wi-Fi in based and for secure smart management, reliable Cambium for and simple, first policy-based have for In momentum deployment with was products platform, cnMatrix spectrum SaaS continued well U.S. Cambium the CBRS assisted our management the and the to both territories. automation. selected living healthcare as service X.X FCC's status XXX of large and our for reliability was by Cambium mover selected wireless Another sales customer gigahertz NFL a for its city Cambium’s XX our cnPilot Northeast in the MSP an WiFi superior win and significant project. the scalability, value. cnWave for backhaul

alternative become and software Further for providing over-the-air from layer full end-to-end June, Our of they solutions. priority LTE support channel algorithms. cloud-based PAl, including to software solutions support upgrades another differentiation we multi-brand competing high-performance include released access once April, in occur In platform CBRS our with radios, licenses, CBRS solutions. enhancements of online, updates optimized

have larger over of Middle managed few the reported share. by call, devices and we Spain, the a we to region, of Africa QX East include from Europe, increase now our CBRS As an quarter. service, since in we wins strategic over SaaS In today's XX% EMEA, last wins XX,XXX

ePMP gigahertz provider will One of at prohibitive. XXXm X where solutions deploying connectivity cnWave WiFinity for facilities recovery enterprise selected of and a technology, UK. XXX deploying Saudi wellheads managed holiday wireless gigahertz win This the its high-speed, deliver a X,XXX They cost the service the of Melbourne holiday the support. solutions WiFiXEU had high-speed APAC deploy well yet Coast. fiber staycations Spain and government outdoor company and months. at Wi-Fi selected cnMaestro its access across operating high-profile full to leading resort rooms guests is already vendor extended cnWave In vouchers. using Cambium's petroleum recreational Wi-Fi. release another and resort, travel for to and one connectivity to high-speed an solutions and points cover secured Wi-Fi upgrade of broadband selected including areas a office program. XVX-X In-country XXX services the aware closed Melbourne by additional on QX X exhibition Also position, six have cnMaestro and areas, the Cambium as In XXXX. ePMP's nationwide Middle had the Union, operations. multiple network with operations. network. to enterprise XX we superior solutions leading Mediterranean displaced in to interior all due technical launch a exhibition having restrictions under of Cambium technology in front and WiFiXEU still back-office selected their Wi-Fi awarded parks the PMP the XX performance nationwide Wi-Fi our conference to switches our in Spain's Ivory their suite project we very at EU’s Spain, year of areas. the Cambium since The with The municipalities In conference solutions to connectivity win a the solution. already fiber gradual Europe the Cambium's to competitors UK's of major managed X. the of carrier powering Group's exhibition Wi-Fi our establish recreation switching replacing Wi-Fi and this East, The cnMatrix the a at oil countries. enterprise which This high-speed guestrooms, is mobile in high-profile and hospitality WiFinity. largest luxury our to center, as Portugal, of used to security region, Coast Club backhaul the due Resort Wi-Fi popular parks. of the Orange part Cambium its five-star have production products enterprise market over software world's the municipalities a first successful public Cambium in WiFiXEU initiative, Approximately for and and sale cnPilot their are first for convention Cambium’s UK, convention XXX cnMaestro win not across our sponsored Portugal's superior Force wind Africa, Cambium entity end-of-life data in broadband the continues selection was are In sizable leadership operators Aramco, resort seeing Cambium’s European connectivity by high-density have hospitality between was closest provide EU’s program Marbella to across our as we its is

large In is New the to close competitor access Cambium. from Cambium deploying back-office center XXX coverage in a Zealand, operations. the points operation. country, a Altogether, Now front and be will across to the Stratnet, decided transition convention in WISP fully

cost service high-speed We to Government's and of by in residential large a over is Caribbean another underserved Zealand Latin phase, areas. New exceeded provider. CALA, with revenue. the this revenues in customers. with had to Tier we Colombia Broadband Cambium second the first a quarter that had deal in Internet Stratnet $XX connect funded project the In Initiative Rural consecutive XXX ownership, first for was the quarter selected performance overall the and region, country of scalability. America, We part are million In million, X deploying record-breaking the now provide at equipment the Cambium the to $XX.X quarter the deploying has northern region

significant for access Cambium's new Wi-Fi Onda, including technology to Panama, project As coverage sites. to customer The different backhaul ePMP who and portion purchase Cable for PMP number this capacity of that switches. cnMaestro nationwide the and connect is of fixed the our base recently owned XXX system divide. the on country. significant software. In Cambium, our its locations cnMatrix wireless digital bridge in functionality plus They those two spectrum, acquired We Cloud integrators project selected solutions, X both management were selected has its enterprise CPEs operator, at using to Tigo-Millicom won by remote a based access of the service expanding expanding reputation, gigahertz

XXXi the won our public Veracruz and PTP government the we safety cameras using to for systems by Finally, plans a a in first Cambium Mexico. XXXi leading PMP being of of state performance numerous The with selected of XXX high-profile Mexico. in reputation because surveillance PMP phase video deploy solutions and transport, as for our used project access. state was the surveillance provider of of XX,XXX our

previous quarterly update. Looking at new since products our

middle expect new to have we product introductions. the of this significant During year, two

heritage strength market strong this outdoor this a Wi-Fi will product, number XVX-XT First, our in in Cambium an in a and particular summer. X be outdoor released verticals, given radios. Wi-Fi market, increasingly the of our Outdoor relevant resilient is has

XX XG the be primary next call. Initially, XG highly product will our focus earnings the gigahertz for for time our our region will our available customers in anticipated cnWave of Fixed around quarterly Second, be POCs EMEA products.

products of in its run high, XG Our ownership Wi-Fi using fixed XG has networks gigahertz lower to and access band, received deployment, gigahertz of its Interest NR EMEA. of XX the Cambium Utilizing at reliability management Cambium's XX cost our of the activity fiber. remains provides architecture, product service our points, yet residential which XX than Cambium video gigahertz of features single access, outdoor of use provider our gigahertz benefits major the standard will wireless in for for XG cnWave and licensed a XX remains high-capacity, and small-cells XX first ahead radio surveillance XX pane benefits gigahertz products customer from strong and and of ease a including backhaul cnWave orders volume spectrum, availability. software-defined cnWave glass. total new scalable from platform

Also this product broadband more as street We poles. product our wavelength and XX in city with will such utilizing and lamps, a for have cnWave existing details furniture high-speed call. our PMP to possible quarter third street utility traffic it PTP during by Cambium's millimeter regarding gigahertz make earnings conference lines, lights provide access

deployed and more it broadband. efficiently As can faster a result, be cost than fiber

POCs high-profile deploy Valley cities. several Silicon that to have selected We in their backhaul have gigabit within Cambium

operating extend costs. revenue to deploying to hybrid We Alaska customer networks traditional are accelerating and seeing fiber using capital as cnWave to premises, operators, such Communications time fiber at lower

cnWave We and solutions a advantage bullish have are nearest to competitors. very XX market gigahertz our time on over

entire end-to-end We continue to XXXX increase connectivity experience XX% manage QX strong XX% growth in accounts cloud utilizing cnMaestro totaled single solution Total Cloud software, the XXXX cloud-powered in XXX,XXX, year-over-year. from QX glass. of pane approximately our a management up under an from network of and to devices

represents to net by XX% net partners Turning sequentially we channel. year-over-year, expanded In presence sequentially. over the our XXX X,XXX channel which and QX partners channel year-over-year. X% And over new of adding an approximately XXXX, channel increase new

for X,XXX held on from attracting Connections Cambium of new years. called is successful event people YouTube. the partner and than the February customers virtual as A both registered, was event our XXX the replay had we was shared where next of vision community. XX the customer and can countries We global and more few industry first-ever existing event headed be end over Our over found on and at our XXth

as review financial recently to the were would customers to voted now Manufacturer our QX for our say will of partners Stephen results Year. Association, outlook. the by Finally, the and Cambium like Networks I I'm the for members Wireless of XXXX call ISP honor. to proud a over I this WISPA, turn and thank the of

Stephen Cumming

of above for to of had service XXXX, On sequentially Act QX networks revenues were for $X.X of outlook million. providers were end grew higher CARES products. shipments for million compatible high million. XXXX, due a quarter-over-quarter record funding capacity, year-over-year. the $XX our X% QX for demand and our scale Cambium XX% $XX.X of new solutions, by driven revenues million of CAFX to X% by $XX increased higher increased by CBRS up and record revenues Revenues higher driven our basis multi-gigabit and which PMP Atul. shipments products, Thanks, The requests continuing to by were higher sequential

better grew performed backhaul. demand Enterprise record quarter-over-quarter, Wi-Fi products. for sequentially driven by revenues solutions new to than growing Point-to-Point increased our products XX% reached a Our our shipments expected, X% of shipments X due and Wi-Fi higher switching and record new cloud-savvy of

region compared and on XX% XX% company North a providers, service of our and PMP revenues QX of during in revenues during in decreased XXXX. geography. EMEA, timing QX with largest quarter a sales represented sequentially, from revenues Looking XX% XX% of shipments result region, that XX% PTP of QX customer our growing basis, number PMP products. PTP a represented X% of and another revenues revenues softer recovery quarter-over-quarter, record second continued by revenues XXXX. at during Wi-Fi, for significant APAC revenues switching region, represented X% during XX% X% America, XXXX North driven primarily record a record had to growing XXXX. driven CALA of and represented of XXXX. compared revenues had QX recovery QX by decreased as XX% of revenues sequentially America strong during XXXX our a and sequential XX% to and quarter wins of by and largest a of including QX reflecting

gross was XXXX. to EBITDA from revenues. freight year-over-year of product $XX.X gross our revenues G&A result The compared business in a margin of primarily freight was during higher by higher lower of of leverage mix gross to XX.X% of and points margin increased non-GAAP and We to profitability non-GAAP shows for costs XX.X% On lower result Moving credit R&D or than model revenues, higher and and of resulting from by million to in and XXXX. XX.X%, QX was spend QX increase R&D in our marketing, $XX.X adjusted from revenues. XX% non-GAAP record the to XX distribution operating dollars XX.X% and XXXX continued revenues record to and expenses Non-GAAP of QX timing decrease another from or when X% approximately distribution component the QX non-GAAP quarter QX remain adjusted XXXX. million result had from operating of our to general, was and expenses decrease XX.X% sequentially. QX $XX.X due The for We administrative, stood committed XXXX $XX.X of revenues. from in and non-GAAP million $X.X to Non-GAAP compared by decrease gross higher less with million compensation for due increased reflects a see gross profit costs million shortages expense amortization improved mix quarter-over-quarter margin up The basis expenses sales excellent decreased points incentive and market. gross our research X.X% margin. other marketing basis The quarter-over-quarter market. and XXXX. or XXXX, of $XXX,XXX. basis, by the development, Non-GAAP to XXXX, margin R&D the for up a XXX resulting QX QX regulatory lower by sequential When XXXX tax due in QX events. of the a XXXX and XXXX, EBITDA shortages compared of revenues and margin QX of costs, XX% QX QX expenses, and $X.X higher year-over-year a trade XX% in to compared In target driving at million million non-GAAP to million at of to was and depreciation in of increased increased operating the to our or sales operating and $X.X year majority prior compared lower XXXX component $XX.X XX.X% in

operating QX operating $XX.X the A for $X.XX XXXX the net scale per demonstrating delays fourth increase XXXX. to as to year was quarter-over-quarter million increase activities for diluted in million shipments diluted variable Cash result impacting profit Non-GAAP profit non-GAAP of $X.X the compensation in activities and as higher decrease for provided cash due or primarily was goods we attributable leverage from QX receivable in of to accounts decrease non-GAAP net cash had QX the $XX.X compared income flow in primarily The higher for dollars quarter a first XXXX an to or we primarily the quarter and thereby a share for inventories The and record timing we pre-paid The per collections, income by This was efficiently higher in cash gross in flow. receiving key to used of million XXXX income improved and revenues strategic XXXX. $X.XX used by to delaying accounts and income improved resulting secure was increase of our share compared operating XXXX. was higher operating million as the gross quarter compares $X.X dollars, compared model. components, earnings. revenues, business. Moving our cash XXXX. $XXX,XXX net final net QX of payments by $X.XX diluted prior was or net in for period of share to flow in first offset $XX.X supplies per net payable, million non-GAAP activities revenues for and

of $XX.X sequential business, Turning QX by was growth compensation decreased decreased $X.X of as and decrease payments variable result XXXX Cash increase from strategic to constraints of in million The of a $XX.X million for due from decrease to the as million shipments, million inventories support $XX.X prepaid the offset $X.X affecting increase XXXX. accounts XXXX, accounts in earnings. QX receivable to of sheet. Net linearity secure in improved QX year-over-year in million and payable primarily QX an the supply by in supply XXXX. inventories we by balance totaled the decrease a cash and of

inventory the revenues of we inventories expect gaining growth, modest sight quarters. within summary, we line levels, in improving Given of low few operational target increase accelerating In achieving and next long-term our efficiency. the model over are and operating our rapid in by growth a scale

Our results operating leverage have demonstrate in we business. tremendous our the

continue have visibility into improved business. to our We predictability and

we constrained, expect we our the shortages, supply impact Given remain which global growth QX sequential semiconductor during to XXXX.

Please Networks' of pending that does second financial Accordingly, not any to matters financial Cambium Moving in of financial reasonable. our Networks outlook transactions, XXXX include potential or outlook outlook. only Cambium quarter they such transactions. legal includes financial are note the future impact items the acquisitions, other possible to the extent

diluted XX% expense million EBITDA EBITDA approximately share. results adjusted $X.XX margin $XX.X However, is outlook. $XX Interest million to to as $XX our outlook to our $X.XX income effective Adjusted $X.X outstanding. $XX.X of actual $XX.X financial net million and to of may million. May XX%. $XX.X differ between be from net $XX.X Non-GAAP Considering visibility million million. per approximately revenues as or to of million. XX.X% million to million shares XX% rate X, tax to million XX.X Non-GAAP expenses operating roughly million. QX to operating Non-GAAP Non-GAAP average margin and to between XXXX, current between the between income $XX.X gross $XX.X materially XXXX between weighted Non-GAAP to between diluted follows: million XX% XX.X%. between expected between $X.X

capital excess the and Cash $X.X expense Paydown $XXX,XXX interest of requirements. our $XX.X cash the loan approximately credit reduction flow to cash debt agreement. $X.X million provision scheduled expenditures flow in of principal million required and term debt, by million. additional in an to between $X.X Turning as term

increasing some the between full back Looking to between to at XX%. Revenues now between XXXX and $XXX million, I'll to turn XX% remarks. outlook. to the XX% year call EBITDA $XXX XX%. for margin Atul financial closing million adjusted

Atul Bhatnagar

to to solutions goal are and Cambium as gigabit presently Fixed adjusted millimeter our delivering. the products mid-teens our continue gigahertz to top achieve strive long-term such drivers in for a percentage these the we the revenues, gigahertz in XX and has of which year, upper growth this XX reach X, XG of multiple line We teens revenue goals, middle wireless. wireless new Wi-Fi as enterprise wave of including in EBITDA

as list – now expect to the the drivers of software adoption growth as cnMaestro X add inclusion of to compatible can we of with CBRS we our solution. solutions XXXX continue continued We service to a of

benefit while from our will increased business we we manage costs, profitability edge. new to maintain our in in continue to judiciously Our R&D although should scale investments technology fuel our

to show these customers my partners like unprecedented would remarks. This appreciation during our our of for another results employees, and for quarter outstanding I times. concludes Finally, prepared

So that, to turn Abigail call the Q&A with like would the I to over and session. begin

Operator

Instructions] [Operator with first Hall the line Sachs. of you. Thank comes Rod question Goldman from Our

now open. line is Your

Rod Hall

for Thanks taking guys. Hi, the question.

to question first be So my was visibility. going regarding

Are the I here. raised have a follow-up You shortage. a view? ordering that. your your the full of early? to year do visibility if, guidance And visibility going people then showing from you with carrier are particularly of customers and supply more because And What's wondering bit point little on orders here

Stephen Cumming

is Yes, Stephen. this Rob,

time, our invested to visibility. public visibility I actually that we is, we've in continued company. of I And a it's think in systems since improving One improve twofold. effort and think has a really overall business became lot

we really is tools – POS their and and and sooner think for place do gauge sell-through can for We our forth tighter though, the overall your to that such comment distributors from visibility activity a ultimate to our what additionally, given we our the the orders customers tendency have management I sooner are customers. channel and seeing supply customers. constraints, seeing

place, XX% We're of ahead first that. backlog really better enter continue to that month improve. since I of in And with to and in or We've the way like is sort of in of ahead So that that last the things. we've are than QX of entering that exit excess actually quarter of in billings We been quarter. that we're quarter improving the and given think seen QX, XX% of tracking we in north we're and QX. QX, year, certainly of

So better. us. And putting those visibility getting orders as additionally say is I are is into customers longer-term quarters well would future improving that on as visibility

view. picture So overall, our a better much for

Rod Hall

Okay, great.

Atul Bhatnagar

point. are getting more so new introduced, Maybe, I Rod, The applications, products the customers new if new just funnels one I are stronger. think, finding also add we have can

the about as think, definitely, hear next demand. more into will go more So we it, quarters, just, you I few

Rod Hall

as And just guys we that's Okay, this you question, to bit you sort then so online? a you whether the XX% what And that below Are I guys wanted below to below then Atul. you're for this expected. expected had as follow-up thank growth And and We were XX% Wi-Fi. curious numbers was kind have – if they Wi-Fi I'm in expected. what quarter? part thinking was of were the you, – if on talked what of you this what printed Wi-Fi. the about – you still hospitality of the what on I year comes back thinking industry little

Atul Bhatnagar

Yes.

me supply quick fantastic XX% right and then let rundown give enterprise in products, So XX% We think absolutely demand constrained on, to wants on add. if We Stephen a were to good acceleration. is QX.

are So good in. new some Hospitality very we X back. markets, definitely we with traction adoption, coming the the feel which where product getting Wi-Fi the lines, are of strengthening, we

that So hopeful market. actually and pretty we are confident about

Stephen Cumming

Yes.

from in was was it just line pretty to I I quarter. we – with Wi-Fi actually expectations add what pretty guided think to our last – So much think that,

more as of think, becomes than issue it really, Atul situation. demand supply I mentioned, a a

Europe, government world, And to as Wi-Fi Wi-Fi particular, for And opportunities driving see and feeding we're seeing And subsidies product. some we're online, regions rich hospitality. seeing the new the we sort really going logistics quarter. of grounds market new in start hospitality into particularly demand this for WiFiXEU for these last of medical. providing in We're seeing come Europe. are in program They're finding, of markets back We in like also other we mentioned our us.

QX. hit good We actually feel we a about the So numbers. record for

We expect good sequential feel the XX% and increase for XX% to trajectory. about QX growth

Rod Hall

Okay.

You're be risk not worried Do to that year. about later being supplies the the think you Wi-Fi fine? in a growth will

Stephen Cumming

our and No, we calculations factored guidance. into that

think to we So XX% XX% hold.

Rod Hall

guys. right. Thank All Okay. you,

Atul Bhatnagar

where outdoor accelerating Wi-Fi are one maybe a countries, effects is everywhere. we situations want they have one more one because public differentiation. outdoor that's Wi-Fi, data connectivity maybe Rod, COVID accelerating superior point government, many very And of the of is and situations, is

good are. we So feel where pretty we

Rod Hall

you. Thank Great. Okay.

Atul Bhatnagar

Thank you.

Operator

Notter question with comes the from And line our Jefferies. George of next

now Your line is open.

George Notter

very able I a much wanted an sense to supply much the QX here. up. on to also, to give Any impact Can how the And sort ship back might Hi, revenue in go results how on pricing on then had question congratulations of obviously, for margins? of constraints? have because supply you I that guys. component on nice Thanks and weren't you is us guess your going thoughts constraints.

Stephen Cumming

Yes.

would tough quantify is So Stephen, say again. it's this I really – that. to

came still guidance. of past end we upper I our the think

QX I for are it to impact think constraints of the going more with supply drilling QX. be a us into possibly

for last And the quarter we down. so tighter be guide, said us. QX our felt sequentially, to would X% you we And saw quarter, we've more from guided be likely

lot chain As of a year company, we've done the building stock. last supply back actually ahead a of We things at get started way this. to looking buffer and

is that's QX really, quarter our But than and think tougher most. we're So into think better situation I in guide. be going the to built us, to a I

Atul Bhatnagar

Yes, to maybe point one add. more

suppliers. kind value indoor/outdoor. the for XX the excellent work our closely that that solutions architects reason is Wi-Fi inputs as company our of gigahertz, with our We cutting-edge, relationships is on have gigahertz, with And X They the them. system of Cambium state-of-the-art, strategic works very XX

as last because we knew So with worked of them as year, the as Stephen November paucity coming. was proactively early chips mentioned, we

we into companies, – are guiding, And taking I So have account. we to think those are well competition everything I compared we're think things positioned. other and we

Stephen Cumming

Yes, margins, with margins to regards question again, XX%. your guided this we certainly, With gross gross is our XX% other to Stephen, again. guide, on

reflected surcharges a bit So obviously, freight costs overall the seeing component little higher as higher we the cost the our as in well. from And result a associated and supply guidance. impact the are of with constraints

You've over XXs. gross to the you've seen, expect still gross last and longer-term see through into we expectations year, materially. company, a come XX%. of quite our margin done expect, improve we you obviously, around as seen I the that back of the model would lot gross a once And we've towards have margins supply these XX% work driving should to constraints, our margins them

George Notter

a is ask in one If subject follow-up. bit could ask more but wanted about I I it. a just X. change Got here, cnMaestro to This of

looks big you're the of There's a going what with and feedback Thanks. that. like trial guys, You customers. initial the that quarter. just in curious introduced your I getting think, acceptance kind on what on I'm

Atul Bhatnagar

Good features, well, And good the we services, storage, as features. platform. now think reception. value-added I And the security data commentary duration the as of some of as mentioned X.X million with deployment very users in have data over – we using storage, a Maestro

manner. then but deploy it's so – helping far positive is I feedback still think good, are winning deals. far, in you're few these broadband of a networks easier a more many And initiatives, early, for customers very we quite government so seeing

deployment management, they monetizing. a One acts And as just reasons through the which additional is cnMaestro as of cnMaestro find features of now for differentiator. of are key ease ease the we

how So that you monetization good part going. every give entire and we'll – is a guys quarter, rundown

George Notter

Thanks.

Atul Bhatnagar

you. Thank

Operator

next ROTH our from And Capital. question with is Searle Scott

open. now Your line is

Scott Searle

Thanks passes, your There and comments. pipeline Hey, And of some there. lot big attributable address programs of If what start ever of big that numbers to RDOF opportunity there are you the some divide. right? bridge subsidy were out you the adding the if wondering potential you is bill, – and to that digital quarter? revenues infrastructure different first up the various how initiatives good afternoon. government from at I for the taking could you questions. a when in that referenced for if Atul, broadband numbers and my in was RDOF, opening if look there, regulatory

a in little where months? that Maybe bit mean could what next frame wonder could the terms are us I XX you of today. we So for over that if

Atul Bhatnagar

RDOF probably early manner, said behind a a think Cambium lot we that. as of think XXXX momentum still see probably I last XXXX, Sure, end we'll in quarter, when I for meaningful is of you'll

RDOF say, my is there. would things. in parts, Wi-Fi, The years. I said when RDOF quite it, six will, they're this And the RDOF And think approximately get Point-to-Multi-Point, with of here of spend we you significant early the And product late I hear means early formula if be real will using products time of of or or the winners, you what few start manner. as year, XXXX early those things a kind And other. is type type the think But still will well Cambium I the wheel in that momentum, of and on a in a positioned is and year RDOF backhaul, the probably of next first access you're to half think, will we see right winning already them, infrastructure, significant but is projects some are until real now early I going. then, early seeing starts you'll for them the those year. are were start this late Cambium moving, very guess Cambium earlier, projects

So that. that's color probably a just of little on bit

Scott Searle

Great. Very like helpful. XX momentum a for And seems it's as you. gigahertz some gaining follow-up,

if how in gig coming is give you. of And think smaller, wondering starting size urban an update I'm year. opportunity the specifically us you the larger different could opportunity, referenced says opportunities. versus bids, you behind larger my XX this you into gig could big think the markets, I product technology, terms Thank different comparable, wondering to bigger? XX solution, now but I'm in move which, XX it, that with mind, gig you if

Atul Bhatnagar

Okay.

QX of So I POCS. year, XX for this and for, QX, lots say, gigahertz, would at least

probably so but performance, think pretty still over Cambium on And north MU-MIMO would customers QX, architecture in of fantastic XX I think reception gigahertz, quality, already. say terms are of has far, QX are I pleased. I XX we POCs and

terms you all generally that POC. the for Cambium T Scott, X, of So, my of of plus after sense happens, the do size deals XX is, in acceleration and that six months

July-ish gigahertz of start year real good next – can early end testing, you early time. the have exploration quick late we start when for But And volume again and XX mid-XXXX XX And a we will be you one start to very is in good gigahertz timeframe. POCs. results. I will QX a would done ship year, maybe would we would actually POC towards then with POCs say very be timing I say then XX to QX. So, will probably say, and wise, see probably the customer in will QX And accelerate. then probably

X differentiate and me products. into design you. plus phenomenal a taken differentiation build. let terrain gigahertz weather. on the XX are lot Now products. little and of of weather us Both and give kilometer two-year for and on a There’s multi-gigabit then lot X depending R&D that, depending again all X you kilometer to Both will have to bit two built say, you, a these start X, terrain give to will gigahertz to XX One, the probably and and

can truly multi on So see is a XX XG the gigabit now edge, you have we gigabit. path. Fixed

EMEA since pretty product. pent-up gigahertz a well a also as because for in multi our really, whereas you've last sizable probably both a XXX, when XX XXX And deals, infrastructure got gigahertz the significant network. will a the deploying So And will that infrastructure hand standard. it already XX hand globally, hand, less more it global lead. be X. in are will go But the they product. demand we have anticipation can that product. And be of And received there is is the gigabit set Wi-Fi in are covers glove, will distance, it you go meters, with

we is So, wireless scaling. be feel you manner. close those significant all world And North our will in in America winners, very – XX coming products a to regions. see fabric the truly lead gigahertz different major has will

So, bit territories. I think you'll differentiation see of a little across

Scott Searle

Great, thank you.

Atul Bhatnagar

Scott. Thanks,

Operator

question next is James. Raymond Leopold our with And from Simon

is now line open. Your

Simon Leopold

that. I appreciate Thanks.

quick just First, a one.

for the in all effect supply components the chain the sounds if your earlier margin what the constraint you June you've like get on and more guidance could sell understanding more it in gross asked revenue assumed March. needed. you I interested were about headwind I'm guess you could headwind, You

that to how trying to quantify headwind. understand Just

Stephen Cumming

certainly, I the lead obviously lower think our the in there we a mix perfect on and the the availability. – case. Yes, out end, upper lower get you But get there's assumption to – try I higher the where that better mean, the and are case at component to scenario I not between pushed deliveries build way Simon that's the think, in situations tried of times components missed. lack and end, get we've end, the an and on assuming always availability

number our upper of at to those much give more end tried to guess, supply aggressive upper little our I do a we've we've risking But guidance. and how so, And if ends. been it's could issue, de lower we an but into that sort you again, a on tough bit more probably on not lower was factor and

Simon Leopold

somebody of you, margin end understand of sales, do of high vice to mean the low assume margin? make of gross the and sure a I just versa, we the end low would sales should gross if end makes you So, end high assumption that

Stephen Cumming

you Yes. referring that's to, Absolutely. what absolutely, If yes, yes.

Simon Leopold

that. Great. No, I appreciate

WISP. of T-Mobile Now, your I which the dynamics see like commentary Charter changing moving if really about markets, about efforts question the of the longer-term about wanted your I specifically, thinking to primary about historically talking more certainly competition, sell and customer operators is heard could base, to you services turf the rural into talk was into urban. I'm

the So, landscape I sense if attack. into want how your to you're necessarily you it's like isn't get and sold? operators you. push technology T-Mobile competitive But the that footprint of you've of as where yours not see, historically making Charter, counter a Thank not

Atul Bhatnagar

good Yes, color by the this. way. Simon, on will a give excellent I question, And

the I we first probably are key the statement that I'm think finding the Cambium time. That's value for chain. making, up moving is

portfolio doors innovation think they're capability not people XX noticing gigahertz I I well. over have kind lots gigahertz, in happening are Tier think Cambium XX of the Xs is the added coming. the noticing product we X, but our Tier months, into the of XX for the say opening quality, And globally just is of what's as last,

names we of you're good regions, throwing. kind different the with have think I So, traction

go. where all software-defined So, and because but years names, maintaining a well, and you anticipating think are I could their through not of will specific that It's software lot doing two you off radios yet features. from quality I or next we're Cambium of far innovation, give the year, not

will we not the your hear as too six next will of name, which to far over quarters you five, be evolve guesses. think I So some say, some start company, from

Simon Leopold

that Thank insight. appreciate you. I

Operator

And our with is next from Suppiger JMP question Erik Securities.

open. now is line Your

Erik Suppiger

was some you're Or is, what fiber broadband primary with at? I alternative that Is time than lead as on are the that of fiber competitor? fixed components to the do today? more much And then my One, you just question the wireless curious, looking how thanks. the competing lead that much are see on Yes, how becoming longer times you today?

Atul Bhatnagar

the into thanks of we it Erik bring lead And start lead that also QX, so we the sense time. because probably my as as is much go proactively as as I XX think products chip as could to down. go much XX times times, time many now, chips weeks frontier, the especially could Okay, on of shrinking for weeks. of questions. as the the have is company Lead you every will Wi-Fi the working But for north be see of many as chips lead the

Stephen Cumming

add just way that, ahead of we this. to earlier, we said got Eric, as But

we were building orders even and as putting as back in last buffer early stocks So, QX year. – in

certainly, most. and But times. some we're There's or well we're perfect. not long obviously always around with probably some than we're So, But risk dealing positioned this. better positioned uncertainties lead

Atul Bhatnagar

Yes.

saw So we this timeframe, last November coming.

had partners. beefed we So, up very our closely working our proactively forecast with

given had for you better February So, much will I because growing – said, a did position us forecast as or much till think company. see and We wait we as I not were we our March. higher

look anticipate coming as would So I easier late early high. it probably QX. do down But to I them times lead QX well. yes, ahead But to say, are a little was

second your fiber. question, Now

Erik Suppiger

Yes.

Atul Bhatnagar

wins. Alaska of we one just are We finding them. of actually Communications, talked significant

said, and solutions of any very I that on appropriate as always initiative, we RDOF, are So, match economics. government will mix in you focused other and see

a areas or extend neighborhoods, Cambium; tough to economics, need of which partner. Cambium. they they be already they I high-density where actually And for to performance, And fiber. to they fiber to finding great think solutions low-density come fiber, win, where extend, are them they sense come many guys ultimately areas are the win because where going there have Cambium terrain, are are hand-in-hand. But dispersed to there which it makes they are

are why think RDOF really you relationship. some fiber winners not but I finding So, as when competitive this winners, do a with, of they And even be we're the a well. we this is RDOF at working the symbiotic to look

well a and very is enabler be to Cambium wireline. of broadband actually So, wireless significant positioned to both

current are wins that. Now showing and current that deals us

Erik Suppiger

very Very you good. Thank much.

Atul Bhatnagar

Eric. Thanks,

Stephen Cumming

Thanks, Eric.

Operator

Jon is with Lopez Instructions] [Operator Group. next Our from question Vertical

now open. is line Your

Jon Lopez

two. had I much. very Thanks Hi.

intact, and little there thinking relative the kind right? your or Wi-Fi, even The kind factors Or first second other flatten if annual that at not bit around the I I of Point-to-Multi-Point first. half taking maybe trend take Point-to-Point, that look a in commentary are to don't out of guidance, down being about and the into know, implies account? one aspirations it Am I those I'm we

Stephen Cumming

Well, Stephen. I mean, this is Jon

you Point-to-Multipoint think at looking still pretty QX comparisons, are I when XX had strong growth percent. right, that in year-over-year QX. for in you year-over-year it's saw something like odd And

look So, going a relation is perspective, when second it percentage the half comps, year-over-year, at those in from to lower. you to be

be north a of mature. I to think Point-to-Point, expecting we're XX% growth. more overall, it's of sort Point-to-Multipoint of

bit exposure little we the a that and to lumpier the obviously, have some contracts. defense So of given

and the think that's numbers be between to And I XX% already XX%. flattish, your right going that's assumption obviously, there. So given we've Wi-Fi

some that put it. color hope I to around So –

Jon Lopez

I second outset and topic wanted smaller against, competition. guys a picking some come helps and the think that question, said, share helps I Now competitors. a you. to larger mentioned that Point-To-Multi-Point, comfort at lot. to And that think Thank the you of Yes, My I you up you're back lot.

tangible competitor, share like the a you of of issue. or long profile ago they the You high that fact, that are, peer this competitor, sort is set? up to relative anecdotal that business relative sort that to of more your see in not at picking you evidence – looking wondering, have I'm with guess of couple had have security one missteps, relatively do one large I sort of them

Atul Bhatnagar

No, I think, Jon, anecdotal. this is more

or more think lot competition in as competition, well are share I think Not we picking Europe CALA Asia. broad a I regional a basis. or but large we of on have just

have, point, the of products highly all broadly, would new this are because from glass. managed at are say a think they type differentiated. pane we I I more They single of of

it's one at to this company. not point, I So just think, me

I frontier. is a think this more broad

getting what's driving are up picking picking applications. We it. territories, We're new new customers. share. in new That's We're

Jon Lopez

that. asking commentary? kind saying, of Okay. than you're I'm sorry, we've you're growth business than at I your more displacements peer to say, I to is, just so better the your guess identified, about set clarify was that or sort of saying your and looks right think the there. way what competitive looking Is here

Atul Bhatnagar

think you are saying I anecdotal, for across we No, broad-based, the rising tide us more front. I'm is just our are right.

Jon Lopez

I got you.

much thoughts. I it. Okay. the Thanks very appreciate for

Atul Bhatnagar

Jon. Thanks

Stephen Cumming

Jon. Thanks

Operator

closing And Director, will Mr. to I for turn Schuman, there Peter are Industry further Relations and no call Analyst the now questions. Senior back Investor over remarks.

Peter Schuman

Abigail. you, Thank

Communications Technology the Global Needham at Media this concludes for Investment Spring arise. Conference; Morgan During meeting Virtual contact Media QX with Conference; always XXXX & Technology XX May James at May you Cambium questions J.P and us May (XXX) Raymond will any presenting our XX In and Research call. virtually XXX-XXXX be you Barrington and the Networks that with and are investors with on XX Virtual Department joining the at Conference; Virtual at May Thank Tour. Bus XX, Relations to welcome today’s Investor meantime, the

Operator

Thank call. today's participation. earnings for your Ladies and quarterly concludes you gentlemen, that

now log off. may You

Cambium Networks (CMBM) 9 May 212021 Q1 Earnings call transcript