CMBM - Earnings call transcript Q2 2022 | Cambium Networks Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon. My name is Jason. I'll be your conference operator today. At this time, I would like to welcome everyone to the Cambium Networks Second Quarter 2022 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. there a remarks, session. speakers the will question-and-answer be After [Operator you. Instructions] Thank Mr. Industry President, you Vice Schuman, Analyst Investor Peter conference. and Relations, your may begin

Peter Schuman

you, press the call of our quarter prepared on SEC. are call. accessible thank for of on the and Thank release all on our page those referenced CFO call, and CFO, of joining webcast. to submitted remarks the release, CEO; are Welcome the today Atul Investor The and be by conclusion available us Bronstein, Bhatnagar, this X-K our our and press call. today's you commentary welcome today's Cambium also A copy and financial financial here with XXXX for second and for joining investor results, website results President will the conference on page Networks' has Jason. been Form Andrew at

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

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

the investment President provide outlook of for the for quarter will XXXX the agenda. Atul recap Andrew results third Turning XXXX quarter CFO, a our & and CEO, Cambium financial second the to will full-year Networks' the the and present XXXX. highlights Bhatnagar, and quarter Bronstein, Cambium's key provide financial for second

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

Atul Bhatnagar

in of regained our of of of lower Thank slightly you, midpoint anticipated quarter to of increasing Cambium Peter. we $XX between as scale, outlook to our improved $X.XX, margin, between million announced during sequentially, due ahead million, had million of significantly, our revenues the tight some our had with with Profitability 'XX controls. QX EPS spending was recovery than $XX ahead call. second cost results to XX% gross quarter higher $XX.X $X.XX, $X.XX and

of a start strategy growth strengthen. new the Our Cambium is technology and roadmap S-curve. to at continued

this During from Cambium for phase, five-year an the phase, slow change, stabilizing time evolutionary before and into initial last maturing. a cycle is performance a we goes starts about was This accelerated and entered XXXX. deployment cycle

increased finished year solutions, XXXX the we We place, our further given for over components distribution now We phase revenues anticipate and during growth business We continued third XXXX. at XXXX, of fully enterprise including of quarter our by calendar record We backlog, sequentially actions chain pricing which X% saw strong late recovery for record the grow expect last XX% exited second of We in X for now with broadband and in enterprise the the the XX% the expect up quarter supply demand revenues. during are year-over-year. improvements higher XXXX. in high-performance our Wi-Fi accelerated year-over-year, second year backlog and now entering announced quarter-over-quarter to XX% cusp grew products of and XX% half are and networks.

challenging, multiple the attractive While situation exited cost calling now 'XX X enterprise we emerging and we Network. are for technologies, of ownership and fabric of record supply of standards wireless quarter QX another products. remains solutions tight and backlog Cambium's which broadband with total cloud-managed Cambium integrate communication

the for with of choice pane management around network solutions a wireless infrastructure Our glass. are single from world compelling a projects

to Turning the of the results XXXX. second quarter

sequentially service our providers sluggish ahead 'XX. products X% and at revenues and PMP PMP for introduction decreased XG cnWave Point-to-Multi-Point, technology lines, expected of due business fixed gigahertz across of Looking the both of year-over-year, XXX ramp XX legacy the our QX XX% decreased X to continued gigahertz revenues product from the demand during products,

China increased business gradually, during products Point-to-Point, to shipments We year-over-year The the QX unlicensed although 'XX. frequencies. a QX the higher product improve, are as PTP seeing benefited XX% sequentially by during shortages 'XX, which while PTP result of for component continue using increased the of to lines reopening X% due ePMP

few enterprise business X mid-market extensive 'XX, an the Outperformer distribution, named last an was during in leader years. XX% strong for our for enterprise the supply May, and robust significant GigaOm opportunity by Cambium served and enterprise improved our X Cambium QX year-over-year, demand to due networking had XX% channels solutions. Our Wi-Fi solutions. by Report and Radar XE built sequentially higher Wi-Fi In and in million revenues increasing to of over a be $XX has XXXX

and meaningful contributor beginning are bookings revenues. a also We to become see software more to

around and An business, XX access demand are business In customer gigahertz the deliver cnWave specialized large Looking win Wi-Fi restaurants MDU city world In order cnMaestro win Airtel and solution. multiple included technology enterprise other and and sizeable home less with providing and the accommodations. small region, Cambium's Cambium wins unit, our focus Europe. to single spectrum infrastructure a for in systems, we deliver X as global smart order Wi-Fi service taking total an was hospitality ordering, same region, X, have on easy Wi-Fi the the can multi-dwelling for from in from selected point-of-sale restaurants cover agreement and Communications, enterprise of Virgin WhiteSky at the their system. equipped we provider, industry, in and X proposition. LTE management have city a for Africa ability PTP region, leader deployment. wireless backhaul wireless plan, Cambium. housing MSP, to In low as mobile focusing venues services CALA, we included With as multiple manage and U.K. for points, for our Cambium service placed operating Wi-Fi orders Federal market, from Germany, leading fast connectivity ability speeds Wi-Fi, Europe cnMaestro dense are an for countries consistently platform. establishment high Cambium's in A cnWave quarters part equipment on product market, large America, our These notable received closed and using wanting cnMatrix than and for for a fixed a cell subscription of few using southeast and cloud providing locations. a larger line XX,XXX first performance the a This upgrade fabric for MSP in Wi-Fi, for East, in hostilities for strong America, to with multimillion-dollar speeds for recent U.S. a portfolio And with breadth in well cnMaestro performance. very reliable and in the it Middle IT continue a our to access handhelds as telecommunications including and we are for new and North deals applications. enterprise. our and with technology selected Eastern broadband enables receiving Cambium for NFL XXX was gigabit deploy, fixed with price optimized managed connectivity equipment selected management leading In and our communications. XG strategic mobile the as Cambium we a switches, billing. provider India network was Rico defense and solution, gigahertz our MDU service a latency market with gigabit landing ePMP Cambium's order placed interoperability fine-tuned developments. and deals defense EMEA, funnel new military U.S. Orderman flagship Ethernet APAC rapid for projects. More student MSP large This including Latin value solutions communications In enterprise high-performance with management the product win superior Asia-Pacific, is Puerto makes solutions. Europe, to Caribbean in order NCR to the Orderman, deployment continue this backhaul and support and unlicensed covering to field. MDUs healthy deals in the and partnering for win affordable for our we significant across XX nations Islands. a had some enterprise

and existing Opportunity be throughput a with are results Ultimately, fiber product businesses. an industry gigahertz Rural second miles, real, and out full speeds XXX utilizing under be gigabit wireless way spectrum achieved million per faster wireless utilizing XXXX our FCC's gigahertz already and channel deployed. experimental second multigigabit actual cover introductions higher to customers is in gigahertz The FCC Internet, testing load, next manner. plans ePMP speed wireless expansion their two Cambium's field half NextLink fiber wider subscriber customers, Fund, Megahertz industry-leading NextLink In since fixed program. fixed new out of to NextLink awaiting Cambium over gigabit speeds when license, network gigabit service expected megabit nationwide. is for will full as gigabit is the they spectrum RDOF, economical announced deployments for and previous the XXX May, per to four deployment enables our expansion X fixed NextLink's before enabling position years quarterly of year, the The for dozen to a wireless module an FCC special X more will under update. commercial Approximately have than compared year-end. our for over fixed X an at availability be upload wireless one over each months Turning throughputs. to households Digital can and of takes licenses. testing, of Fixed and to the wireless released channels timely will broadband next-generation promise for rolling eagerly clearing Upon roll download gigabit product including product gigabit of

management, software our Network vendors managed roll out alignment The X Cambium service to Cambium's federal enterprises new remote at switching, our for security This one reliability this will Instead install complements which network And help. deliver Edge, and and antenna spending plan NSE smart complex rich Service enterprises problems, switching a XXX business, expertise business, network PTP launch manner. radio SaaS facilitate Wi-Fi a set manage and cloud will dealing excessive IT without site in of and the building SD-WAN, antenna. our multiple and security utilizing in of before optimizing wireless primary Network fall solutions. performance Cambium the and our significant looking solutions rapid For automated operate can bundles features, mid-market with services and within of and time solution, national for Wi-Fi, a solution and broadband, edge. fixed we networks a NSE efficient subscription applications easy-to-deploy year-end solution. security providers highly from PTP especially are with products to services,

of Our provides operators MIMO this with XG millimeter Multi-User drive residential and that scaled differentiation business suburban, with lowering to available. urban, radio fall, will the will for has Cambium per and be fixed the combined and and speeds contract and our volumes second megabit revenue over second version sizes. multimillion-dollar continents We gigahertz featuring remain will Cambium's solutions scale. high delivers network during quality gigahertz product. we software-defined cnWave We This better into XX for our believe excited upcoming XX presently subscribers quarter XX wave equipment this XXX for of integrated newest technology. for able cost security, become deployments while competitive deal about insights first fixed and architecture XXX four support ownership. Network rural locations in improve large POCs in to overall reducing performance complexity newest version experience at of landed of solution the for PMP this the XG potential our total

manage single end-to-end 'XX software, strong management the pane 'XX, under Looking solution devices glass. network growth. at year-over-year. QX cnMaestro The in user a X% to software our from an cloud of of over XX% cloud-powered continued experience cloud from cloud Total XXX,XXX, to and connectivity increase cnMaestro QX was up our

cnMaestro now premium product. solutions, provider offering, Annual with Revenue, ARR, seeing deal a X cnMaestro in our are we a for ARR For the Recurring booked sequentially for wireless broadband during second fixed quarter. for sizeable both includes which major and fixed quarter and growth this second during the healthy wireless X, XX% enterprise grew service

This of to X,XXX year-over-year. adding the X% channel mid-market net customers 'XX, over net expanding XXX by QX sequentially, which reach an new and channel channel year-over-year, increase Turning sequentially presence In we new partners is XX% our into channel. our approximately and around our world. expanded approximately new partners represents

During Cambium partner Connections, for Cambium strategy and various online the shared throughout the our customers our and webinars quarter, at vision geos. biannual community second end

X QX solution future ePMP upcoming 'XX Andrew the this of Our for I 'XX opening spectrum QX now is use. for and to call and review events commercial gigahertz North will gigabit American results outlook. providers, separate turn particularly the of service connectivity, held of surrounding excitement we with financial lots important our a for over generating

Andrew Bronstein

of Thanks, increased quarter-over-quarter Atul. revenues decreased million by Cambium QX had year-over-year. 'XX. XX% Revenues and XX% $XX.X for

of continue especially shipments the had are during enterprise a demand, revenue of significant ease, COVID result we While although months first China have constraints shutdown, pent-up impact to our as the global two to supply the we and quarter products our beginning to of products. still in

and demand primarily XXX increased for X% while revenues benefitting of offset end basis by On solutions, a backlog PMP PTP year-over-year. quarter-over-quarter lower QX enterprise improved due by result revenues were 'XX, demand by higher Our legacy The were and higher sequential PMP with million. softer remained $X.X supply increasing strong, backlog shipments. were revenues the XX% and for to ePMP partly

margin. Moving gross our to

on sequential margin than as as and we instituted in QX of by we non-GAAP of 'XX, quarter-over-quarter Our prior-year by compared the $X.X non-GAAP of shipping. higher hubs increased sequentially points will to to margin the during actions improvements our and XXX was mix compared revenues products. we as from is to of anticipated, mix of progress price although sequential from Shenzhen better scale of congestion fuel the increased XXX notable freight million controls, XXXX by gross tight basis, was The see North margin in from the full-year. higher announced of due costs decreased a by considering increases three due and decline expedited lower million taken increased balance margin in to and benefits the factory profit non-GAAP gross to distribution result enterprise our the note, volumes distribution QX have quarters surcharges lower significantly the ago. 'XX. believe non-GAAP gross America to to improved improved and enterprise to margin products, had component year-over-year higher In million in business EMEA order $XX.X $XX.X QX we We a both continue our dollars through The The the our compared Shanghai shipping gross On COVID. due revenues, gross benefit result freight unlocked our XX.X% already costs, previously to basis higher cost well that to 'XX. approximately was non-GAAP gross expedited positive we higher basis margin and points from decreasing and as the gross a

The outlook marketing QX expenditures $X.XX compensation. remains profit $XX.X XX% and The to expenses was of dollars, timing to operating QX stood of while variable to compared margin lower $X.X per between compared Our and QX for million, in revenues. non-GAAP to income an income was annual improved When year for lower longer-term quarter's compared QX million XX.X% $X.XX or goal approximately target to million, prior of the decrease by QX of XX%. or prior- compared $X gross XX.X% expenses. to due or impacting related R&D of period Non-GAAP share for operating 'XX. decreased to share gross result 'XX, to of the in net the expenses at 'XX to and And revenues compared and million, million 'XX. $XX.X revenues, and when the during the sales non-GAAP net of a slightly for 'XX. R&D compensation. 'XX to non-GAAP Quarter-over-quarter diluted QX operating primarily lower 'XX QX was non-GAAP or and travel, previous expenses of QX higher revenues while ahead decreased and for revenues, diluted timing and $X $X.X share, up 'XX $XXX,XXX, of primarily quarter. QX the of because our related share of million, significantly EBITDA benefitting higher revenues, approximately per by decreased 'XX 'XX, 'XX, margin increased variable results prior-year or $X.XX to the income XX.X% X.X% dollars, million, X.X%, million, operating net profit in $XX.X QX higher compared was of X.X% lower or $X.X compared during the down XX.X% Non-GAAP overall was Non-GAAP operating QX from per compared diluted Adjusted QX was mix, and $X.XX per or from lower primarily expenditures 'XX. income diluted for net for to $X.XX period gross

remains Our operating model solid.

Cambium as EBITDA committed to model revenues. increased XX% leverage We to remain driving some target from are pricing. and to XX% our in improved of beginning revenues adjusted of We business regain benefits our our to operating

provided QX for in operating was our Cash cash for of by and cash used net 'XX. activities operating to and compares by cash moving QX operating flow. $XX activities QX Next for to provided million 'XX, $XX.X 'XX, million activities million $XX.X of

We year. flow expect the positive to the maintain for operating remainder of cash

XXXX, June to reflects capital. increase cash improved totaled Next, sheet. sequential million of our working $X.X from XX, an earnings Cash and higher million in balance as primarily The turning 'XX. of $XX.X QX increase

component as Our and of in million approximately 'XX and 'XX. million business. QX QX $XX finished Inventories sequentially net increase $XX.X goods year-over-year from inventories higher because were increased our about million in $X.X by of we grow an

chain our inventory working we the XXXX. during an increase position are to While remains ongoing selectively challenge, supply

So was a recovery in we summary, anticipated improving China in and supply the the second than due an situation quarter to COVID better chain environment. in

We are now XXXX. the in price increases benefiting from

the Our at backlog are of remains new strong, and product cycles. start we

continue We our operating expect long-term make to scale, achieving toward progress operational to improve model. regain significant efficiency, and target

third financial legal and to $X.X outlook. net visibility $X non-GAAP to our share. XX.X%. enterprise not between and Adjusted adjusted lines. between is in net non-GAAP $XX financial $X.X representing approximately operating to between future XX% to other X% which XX.X%, to expense EBITDA between million, outlook to diluted gross of include possible between and the Cambium and non-GAAP any operating full-year pending to between per Moving million. matters, $X.XX transactions, $X.X Interest income income quarter of XXXX $XX.X product $XX.X million, impact potential approximately million Considering margins between X.X% follows: current our especially million transactions. 'XX $X.X financial $X.X of of Networks' represents EBITDA and margin and sequential QX $X.XX $XXX,XXX, remain acquisitions, XX.X% or million million, of does million Non-GAAP the expenses today, as as growth. million million, constrained, supply of and outlook We $XX the revenues

rate tax expect weighted and XX.X XX% We approximately million average XX% to effective of shares approximately outstanding. a non-GAAP

expect to requirements are as paydown we $XXX,XXX. of be debt Our cash follows: expected of

CapEx flow expect expect approximately interest cash expense $XXX,XXX, We million of $X.X of $X.X to and we million.

Turning financial to our outlook. full-year XXXX

remarks. call be adjusted EBITDA million, turn $X.XX between million back income to to and for of or XX.X%. Atul revenues the diluted to expect closing some to $XX.X I $XX.X to will expect net non-GAAP and $XXX X.X% $X.XX We share, million, now margin we per to $XXX of million

Atul Bhatnagar

strategy growth remain drivers Cambium's solid. and

from second during which year. We chip supplies, are increasing drive growth this our now benefitting will half of the

arriving and Our growth. savvy in X future as X Wi-Fi investments fixed gigahertz in XX XE, wireless fixed the XX solutions products, revenue cnWave, multigigabit switching wireless later and gigahertz XXXX, XG, for drive wave gigahertz enterprise wireless millimeter will of upcoming products launch such solutions

growth, which is will Our invest of the deploys show start technology our I'd networks, managing calling judiciously our of in total This cost employees, and broadband. federal these maintain benefit like business now The our our as we significant next-generation expect to Network, we and benefiting unprecedented our from of remarks. customers world continuing and costs, are ownership are solutions. on future times. Cambium innovative lower ease of to scalability increased partners, the to of focused for appreciation and products remain scale, X software-as-a-service brings fabric, at together We prepared my now wireless wireless and deployment, high-performance edge, all operating results. this during integrated our concludes

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

Operator

Thank you.

session. We Please begin James. the Our comes from go now Simon [Operator from Instructions] Leopold Raymond question first ahead. will question-and-answer

Simon Leopold

better mix is going to the question. of Thanks in your trying think off wanted happen what understanding start year. for you for taking to to the balance of get I first, a the

the that quarters. that is being down which And lumpy with you a have two in to at walked You kind business tend I'm the us year, But figure the PMP in expected uptick. XX% where to to out stabilizes. quarters by nice products the be comment row. for of looking particular, up Wi-Fi Trying sequentially you

of and I've couple a you're for So in got follow-up. the of quarters then ultimately, some about for I'm looking sense what mix thinking next

Andrew Bronstein

for Sure, question. thanks the yes,

as overall of percentage we business continue expect to business our a terms of grow. to continue the to and strong in to enterprise mix, So be

and cycle downtick do to be In begin quarter. And should in because in. think there product to fourth is that we're product that to new will quarter. begin stabilize that terms think the positive the quarter, of that going that PMP, we're mind late introductions, We fourth continued revenues from drive keep results see when quarter-over-quarter third a fourth will of the we in early quarter, the

Atul Bhatnagar

maybe or And Yes, you'll about have enterprise supply phase. we so. the acceleration the probably on see continues, quarters that. I to And point, the if is, more entered are two entering want add one Simon, we S-curve back now

I fixed S-curve think the funnel gigahertz start we the also it. mature -- QX beginning of because in is start into cusp will XX now at on we're And to QX introduce products. broadband, beta wireless the gigahertz We'll when probably It's X we will test now. deals. right is

we As closed multimillion-dollar we first announced, deal. our

see you products beginning accelerate new because So PTP well think like smart in PTP for And there I is the XXX our of will introducing actually and the business the defense -- defense. we're antenna also and bedrock business is QX. to

the ready new will I to is to in base see the you move is to and significant differentiation S-curve. Cambium fixed installed the of broadband, think which So, wireless with lot of technologies ride general, a new a bedrock with ready

future. we pretty pretty Cambium good two operate as of are little for Both but feel the efficiently, one wheels I to our little see. So -- And is describe wheels as both sometimes a has faster, wheels wheel head might always important more towards way more be will a 'XX motorcycle. going you we

Andrew Bronstein

see Yes, we're and QX. that come specifically, through government because good quarter, think third expecting in you'll uptick business. a I pretty in of PTP the And the

Simon Leopold

both how well take well and to see programs them the on follow-up, longer-term you. near-term then, you I'd as both the like like government of get year a current as my and Thank to the to contributing RDOF, hear longer-term? as business, as I'd view Great, BEAD, that as from sort stimulus

Atul Bhatnagar

give good rundown a me both I'll BEAD. RDOF on let Simon, and that take you question.

touch $X $X.X XX Let so. and $XX billion, to RDOF. or was billion me was, fiber. over out mostly years the billion was overall billion Out RDOF upon then committed, first $XX of promised, billion, of remember, $X next

wireless that. that That's funding participating through year. some year very our and will the much see customers wireless next You or late of awards expectations the either part our early of coming are in -- this

project. called Cambium Collection, is done look that, guess And there a release. through half a are and by It's large be different which the fund. phase think federal communities mapping I no best you that's see Broad all 'XX is BDC, when for billion Until will program, the mapping going first FCC. Data my is now. that $XXX funding right They all about BEAD, will at

guess the things. federal or I were see 'XX, them 'XX early guess. both where we 'XX is you if gives my things, on So the of BEAD, timing side that late And end of probably to

Simon Leopold

you. thank Great,

Atul Bhatnagar

Simon. Thanks,

Operator

Chatterjee The Please next question Samik JPMorgan. comes from from ahead. go

Samik Chatterjee

for thanks Great, taking my question.

of one, follow-up. exited of the terms revenue as first I the the linearity see XQ The the last into in period? were couple know exit of I rate of Thank And you got was I shipment it on where sort months the quarter of and or time month situation heading But trying was you in can the to to quarter. the quarter. a comment you. impacted sort of better just how just a have if see during wanted revenues COVID June by things China and

Andrew Bronstein

Sure.

right. you're So

I the were get product in able of out mentioned two months to still a quarter. result, In prepared this open to the linearity And the gradually terms up, And during I as of begin by customers June. that say and we first ended my more doing would shipping very, as early of still result shipping some backup of pretty until when of as COVID. a were especially of some quarters we didn't remarks. at China But we during that as last shutdown, backlog. mentioned May, that despite that, Atul prior to little a COVID really that or quarter, linearity, of even quarter. terms I a slow they out of weighted was mentioned air, and and versus had But things to the with to as a you shipping month And the were quarter the coming strong late recover heavily out shipping freight the well, bit look as the very situation result certainly,

Samik Chatterjee

I you assuming the if clarify in just And disruptions Okay. supply quarter? further that. third any Are on can

Andrew Bronstein

any I in our still despite fact challenging, wouldn't is we're expectation, supply than year-over-year assuming chain business especially is in say where our enterprise supply but the XX% general supply disruptions, still we're constrained. growing we're by more that

areas are product better, quite The but there's we and in lumpiness within pockets situation chain just availability. challenging. of our that there's where still still seeing freight still issues there's getting lumpiness. where supply There's is is So certainly,

Atul Bhatnagar

see growth taken to want And maybe point XX% what into add this have. enterprise year account plus I business, when one is we we we'll say have we

taken have We that. have could situation account tells better. commitments and supply the improves, do we we all if that that you And into

Samik Chatterjee

And is right just strong a in the resilience everyone thinking about economic two about the for line event you slowdown, question the of legs more talked obviously, seeing particularly you're you, broader the now? where top you How side, have about. of macro is that sort concerned here Atul, reasonable growth of you're level and on of is, business enterprise which the

Atul Bhatnagar

-- who connectivity, over we at are Wi-Fi on That world. education, don't mid-enterprises, really really since an anticipate across be that least Samik, to after we we mid-market providers And need are vantage the need need. that affordable smart we side. slow is for enterprise the see slowed down the for especially in cannot down. hospitality, macro enterprise, bandwidth, That going unabated the our a massively, From enterprises, very point, need managed going providing Wi-Fi service city are

are in they who fixed broadband depending could economical, are on slow economics, wireless side broadband of customers of the of lot buying money, solutions solutions is on anyone are the side, lot our down. But performant. wireless because Now Cambium fixed government

about that. concerned not I'm far, So

Samik Chatterjee

and Yes we're mind in market gaining keep share. that

enterprise that's So very especially the think element, I a on side. important

Atul Bhatnagar

enterprise, very and customers economics, are we on Yes, the example, cusp the segment. are ease for in like and deployment mid-market a at liking early of the

we opportunity in that to significant a emerge So have leader a as segment.

Samik Chatterjee

taking Thanks you. thank it, Got my for questions.

Atul Bhatnagar

you. Thank

Operator

from ahead. comes from question Goldman Rod Sachs. next Please The go Hall

Bala Reddy

and you three Rod. Gross expected were the guess that in my question. better. is had we for This see want the off start better margins also. with Hey back, than I performance Clearly, taking guys, to the thanks quarter. in margins performance Wi-Fi for on Bala I months was feel

in ahead lowest the five like On PMP for et a XX-gig your could there? you. more there. confident maybe demand is that product, I in Or cetera. But or of still million new and of pause of have you maybe segment? see talk more tangibly the for see weak customers And what I more visibility Clearly, have? are is But in at particular the expand I generally number do And performance years commentary revenues the any terms contrary, you the I taking POCs the bit gives that you that quarter feel see more explain that $XX a kind of last a you confidence follow-up. backlog you do you got. why more could got

Atul Bhatnagar

XX-megabit lot XX, points throughputs. good. a and saw was time for of business, in couple expectations of we with timeframe of In maybe the explaining we Bala, product, fantastic or Medusa key had So, feel time S-curve XXXX at we we growth. was second why performing the that last so. a entered very per economical, And the customer PMP the type And

S-curve product. of feeling to That We back. performance, is megabit are some that deliver and XXX new two hence, can deliver XG the good that performance. and very where gigahertz in closed the that we years deals have about are funnel And really per We in Cambium fixed And knew over. announce noisy, quarters in need will deals markets, Tier three over through deal -- the And fantastic is conceived probably large that S-curve last sizable. XX one that deals wider, the just we X, which gigahertz kind history and frequencies, think Tier press band new needs are we in The S-curve deals second. releases customers sizable you XXX less these see need not XXX, to size deal. I you the is maybe funnel, we significant of globally. our are seen you X a next will because we the these and of the XX-year have XX

next-generation product. S-curve So growth product have -- that we us that gives the confidence next-generation

gigahertz products Secondly, channel, gigabit we will wider band, That start full for performance. honest-to-good that release with XX gives volume beta-testing X are customers. already that we the to QX, which the

want This wireless the say government that of new S-curve is years. make when for years least done. money overall, So I is flown has And next growth, the this are five to is we in, now point last not five at the part.

are first go to And see products you'll will very don't see networks. BEAD formula on now. think PMP end, strong, go simple. XX I early the coming 'XX, focus those start We think money half Cambium's high after mid-tier, for the very 'XX, expensive RDOF in. have 'XX, the side, money We performance, access in, that come high very and late and percentile, the We affordability. we you very and after is I

both and are, business So where parts we we new the our feel where of see we going, accelerating are you S-curve. good

Andrew Bronstein

would favorable what about of X% channel about to we -- is one to is backlog so that, see, thing demand which inventory and add I PMP channel well. in working is can more get too, our as terms that the comment just the or from is down beginning through

Atul Bhatnagar

And announced more the last Bala, the gigahertz they one in just treated will frequency. BEAD part NTIA as CBRS be X.X program, and few that came This of license weeks. point.

to So government the X the CBRS that with gigahertz treated that will be funding means par allow fiber. at basically

are So all you speak. happening as see these will Cambium changes we --

for comes us the think have we ready and good of we next gets growth acceleration I the as So products we curve about we where kind in. which done, feel are, are, kind the of innovations this

Bala Reddy

pipeline it at because, still And And for only much, is Got cetera, guidance, a I follow-up. it's pretty revenues, could et margins, Atul. helpful. you. it to maintaining cause near-term, some QX? that say, uncertainty of customer the probably wider you you products do why have the a would the of that term. new turbulence reason the are near but because transition in terms two range the -- for pretty guidance I in still if be guidance Very you got Thanks Is like quarters still wide adoption look in with left. so of Full-year sort

Andrew Bronstein

I that's say Yes, would I it. part of mean

chips the I room our market, for we sit whole of availability at expansion. where enterprise that limited the the we tightness right within supply when mentioned specific need overall now from macroenvironment for look there's here think products, those that chain I of the you and

up Now we're the into our in our sales there forecasting our commitments chips may are and will what That's what market. and to get products possible. into into know numbers. those be some secondary based that today, we're But always on result we that our get numbers, frees in inventory forecasting on based

for range basically last quarter, later, appropriate macroenvironment. it's and full-year we overall is quarter think where that the I the So while the were think I one we're given

Bala Reddy

enterprise But could backlog, it And that's Yes, quantify is finally, probably assume for you of it for us? most fair. on business. you it about us? that just quantify but maybe talked backlog, I you Wi-Fi significant could in

Andrew Bronstein

but not even than we're we as in complete what a quantify Yes, if had midst said I quarter, X%, about were we remember, going by we mentioned quarter, to China of last though is higher it where it exactly, last the were you shutdown.

the this of of where -- quite we're you're in and as fourth PTP our there is the is margins, out And And strong. projections and you margins coming than right, but business the COVID still in even quite China quarter as in and us over market, of -- that as we look is margin third mind where at quarter last significant reopening, enterprise, portion further well the as quarter. tend those that's So confidence that well. this segment gives Government segment be strong. well enterprise the amount the And also higher lifting benefit Wi-Fi when to with see we a quarter. as keep being stronger that government were

Bala Reddy

much. Thanks very Got it, so helpful.

Andrew Bronstein

Thanks, Bala.

Operator

go Please Scott Searle from comes question next The from ROTH ahead. Capital.

Scott Searle

questions. is looking the you not could, a I for digging go products. Maybe last you've for strength of the can what's levels. year million. But left guidance The back what I left to record could on through back. that Wi-Fi, of new was third towards quarter in federal higher if there? fourth quarter, couple guess to the that nice But that to for the this you've Because sure to revenue quarter. guiding the point-to-point of I'm heard you're the the part to terms bouncing constraints to thinking government second there's my Thanks a see level different at be ways the quarter, how guidance starting in got like some that? for And I you terms know on end taking it $XXX afternoon. table you've given good due coming are you $XX-plus about million $XXX as implies look Hey, some confidence in Wi-Fi question. of referred implies at million, that out certainly fourth good number going demand. I'm wondering in into And the supply that, if your I of of and

Atul Bhatnagar

one, it more than us that so, number even and anticipating Scott, is supply QX. will Yes, QX, leeway are give we chain improving,

hot are as where are good the with they And XG closely So these we When towards in when products. But of The gigabit the with still working where weekly you will in look are within know what QX, terms and progress. community committing. WISP some we as for they're waiting and said, our of that of you products. this at we new it's more in, supply And 'XX, is chip as work in people lot availability so confidence of Wi-Fi our me, or because -- in, positive suppliers I some I ease, very 'XX some normalcy, around lot the verticals optimism especially we're markets, ask QX. good we connectivity. comes going all in will when basis, calendar chain, we on expect semblance feeling, are are normalcy might the you mid-XX X, -- but always markets see the do get as say areas a excitement chips, they some well markets of X gigahertz some

I feel said, well. the good, XX is of charge. Asia the And size very We leading So gigahertz Europe, new we products feel CALA, good. -- deals accelerating are are superior, as

war, because many the fast world driving deals Ukrainian in history. actually defense PTP the not size converging our XXX seen is -- they has business. are have establishments PTP of now want We because That defense, our interoperability. this

the is things work a us the still net-net, thing feel many gives QX. and progress. reason in supply good improving still wider are converging and chain continues there So range we be chain that improving, for have But supply an to

Scott Searle

spectrum, the appreciate could, I that given existing I gigahertz helpful. on Very XE both growing And infrastructure. X color. the follow-up, and a internationally Okay. as amount if given huge there, opportunity of you domestically leverage the Wi-Fi front,

So I'm things. couple -- wondering

through How take on of interest? if quickly the become this of stream? meaningful in is know have how you of don't portion see kind ramp? you're product level And about the revenue available you quickly milestones, What any do that And that how of thoughts quarter. If I could us a front does early the the Thanks. XXXX? thinking we fourth in will terms be

Atul Bhatnagar

that the Wi-Fi Okay. do very questions, and X much on antennas. focus the approach Good of the The a way innovation our gives lot very to affordable especially cost-effective has affordability. to point-to-multi-point, in us chipset we software fact that a XE, ePMP use Scott. is line, we And we where gone

and with And many service Many markets. dollars -- is no service will countries. have government us providers affordability. fantastic global for many So this it a solution in gives truly gigabit

and will complement very So of very the when performant. challenges. to affordable we in #X, customers many miles, of mile, providers challenges per fiber it and making #X. are these dollars that Cambium government solutions point sure That's fiber. Service to customers Point Many dollars, because government be have they remains or geographies. our revenue no ARPU subscription comes going significant two terrains average are user last kind last have

for of this solution want type they gigahertz. So XX

are customers to STA, Authority, our This acquire. called which QX, going Temporary the STA is license, We Special use will experimental licenses. in

North North QX, and they're evaluating, And what copy America QX, FCC that. will now see So many licenses, POCs are is in America. you QX, the right And of across lots under AFC. STA we testing watching do now countries

is that basically very somewhere there, done QX AFC this And concepts is proof half be used be 'XX, coordinated So the approvals the in will to start a STA will first and and innovative. that of anticipation my license the and in all strategy going. spectrum

good. we feel So

product. to anticipation be my usual, will POCs, 'XX. And of one start probably to be three produce volume quarters We then as two the first is, will second the ramp lots and half of quality of companies

Scott Searle

and much. the looking forward so color Appreciate ramp. the to Thanks Perfect.

Atul Bhatnagar

you. Thank

Operator

comes question Erik Suppiger Securities. Please ahead. JMP next The from from go

Erik Suppiger

and for thanks. taking Thanks enterprise. on great the the question Yes, job

We WISP uncertain haven't of of your seeing slowing end an customers. heard now? customers economy macroeconomy light What too your the of on much in or terms you kind are right in

Atul Bhatnagar

no question is these could new this there RDOF, that money, take side, whether it's whether it's BEAD WISP the they but all On time. they projects, to want also in government-funded participate know that

is for RDOF allocated. said, 'XX so to now to dollars be because first wireless still I money gone As have half fiber far, more billion, the there's right lot $X.X but a

small And that's very CapEx also anticipation. constrained. So WISP are definitely our the

this not there's There could happening there there. So consolidation is countries, dynamics. to there. But story be everywhere. more the different When could different acquisitions go you be

is key sense as and in, gigahertz, WISPs. dollars the you'll these in adopt example, come for many WISP happening government XX So that then other X next-generation is basically my see gigahertz acceleration technologies, that countries, is

one of see will And in In Pentanet customers City fact, the really called deploy gigahertz to connectivity you by Australia. there's XX of in release in our press a Australia Perth. using gigabit they're

is what S-curve new time. and starting, the think entered we I So XXXX last that's I said,

a a years it's mid then S-curve, the I think then two it XXXX, and early Probably in acceleration, of solid and enters phase QX, one in maturity. year good solid late five-year cycle.

that's So S-curve starting year. we late what new this probably see a

Erik Suppiger

of have changing fixed you? wireless for number particular really the access. been T-Mobile, that then is in dynamics competitive And Verizon, embracing the the How telcos, Okay.

Atul Bhatnagar

good that's afterthought. be used Actually, was broadband mainstream. a It thing. to not fixed Remember, wireless

their that XG solutions what I'm think But urban broadband. I world might the Verizon very -- of XG large-scale legitimized solutions it solutions. gigahertz the has because be part of fixed done glad and has AT&Ts or XX pushing are very and

solutions many Our economical. and suburban, in are cases, rural,

that Cambium the we have. have they awareness broadband those if what benefits marketing wireless because increases, fixed don't So dollars overall, of

you net-net think will So -- I see another dynamic.

which these government-funded -- they license subcontract a many providers will that they they win a have is bring providers good that's will these will large second-tier get smaller participate. they the them they win, other service may service will how deal dynamic project are might And or and areas companies providers, or for And engage may Another or may a but Cambium. larger business. enough service these that's

is and broadband So you water see, wireless a quality no down, required. will fixed the in in where Cambium how trickles beneficiary matter anything when be affordability

Erik Suppiger

good, Very you. thank

Operator

from go ahead. question next from Notter The George Jefferies. Please comes

Blake Mielke

for our taking Blake on George. thanks is Hey, for questions. This

model. price able begun have felt that the you've specific is impact from mentioned But increases increases more segment And correct? to price any work through? full pass still been there You into not to along the you where those, have

Andrew Bronstein

numbers So much -- at the point. numbers in enacted last price fully in our increases year this for pretty we QX the that are

you If backlog, we remember, that and this worked didn't through we our backlog, impact at point.

in the look and QX when increases, we're trickle in, at some -- going are and So be look but immaterial. price the at still you you QX, if to the there what that QX those really results then include it's expecting may

components, that's about. increases side also you're the what increases we've in chips, have there. in increases offset cost all costs and certainly think on price that that the we've freight that I and spoken price the So has in We had experienced seeing things

margins the driving mix And increases year. the the more gross from is with overall, heavily by in price nature that So weighted market. so being And the our increases much carry more net-net, that's which really that's than and increase last what's increase impact the of mix, profit by offset by a more gross products, price higher cost were enterprise our increases. what's driving really towards margin

Blake Mielke

mentioned then helpful. still or sequentially And kind or...? or think down of stabilize Was current to lower it. X%. was levels that these work Got year-on-year? around That's inventory you you And do I expect channel then inventory channel

Andrew Bronstein

QX. was of think QX, product for happen that early and a work new to And Yes, PMP as bit I that's introduction late sequentially, And they'll continue that will line. in to that specifically probably for product the waiting the down happen. stabilization terms in in waiting I they're think and

Blake Mielke

much. very you thank Awesome,

Andrew Bronstein

Yes, thanks Blake.

Operator

Tim question from from The Markets. ahead. Please Northland Savageaux go comes Capital next

Timothy Savageaux

we something I'm One, little And I want and forgive Hi, me to here. But a on if late, repeat focus on perspectives. good different so PMP just not of afternoon. I'm from couple sort QX of guidance driving guess trough should gave quarter. growth as what the the looking first I question? about you But for sequential be what's PMP sure at revenues, is next

Andrew Bronstein

No, in then QX, QX. decline then will QX. further expect so late PMP QX. And to stabilize there will expect early that in that be we uptick And an we it you'll a begin see in

Timothy Savageaux

Okay, great.

is So or at I QX the trough we guess, least, hope.

big sizes you think XX they including these booked that's the pretty QX, past. I of you've seen to mentioned, comment. are should side, pretty were in you'd like the of but some mentioned what they gigahertz terms drivers big be 'XX. that PMP-specific if on And relative federal for know you've PTP don't the on a in recently. deals side, the deal that calendar In the mentioned And deals seem context I was

tens maybe characterize Should XX these in thing. of you'd those order type millions magnitude? of we gigahertz about think similar I a thinking deals in be

Atul Bhatnagar

Let on rundown me quick give Tim a that.

service deal So reason scale have for And XX XX said, these providers larger. buy larger money have who licenses the is to gigahertz. that for as I larger are that the gigahertz, sizes networks. are They

So the going we to want have XX four And right off faster. gate, continents. in POCs monetize they

contract working XX we announce But one is you still because So we deals, start now these 'XX probably as to is and phase deals. this the of through other to press time gigahertz My is done, the sense close close acceleration. move of time, closed see to will One that them. needle early we from are have releases. will we will

for coming these network. And look are differentiations building good And I we Remember, taking these at service deals. towards the this MU-MIMO, providers. said providers throughputs per products these at differentiation very size service sizable are years pleased is we they XxX we out. And the are pretty pretty deal, and I'm two also now megabit a So when our conceived the back, earlier, are we some XXX in and the as XG. building of scale, XG product, second we're

acceleration, of that might confidence But a really deals, S-curve. start we announce terms closing in product, in gives contracts, are the have 'XX. contracts So of And more would the beginning this and terms we of we new say to close. we close as that fact right me I is

Timothy Savageaux

on more that. one just Well,

those do quantifying a go should want of you So POCs at shot aggregate deployment? XX the they full to take opportunity to

Atul Bhatnagar

contracts. specific one-year five off far contract. of Tim, I these of are Almost generally, year you're are will you're long number, not them too deals contracts, deals. you give a off are wouldn't These dollars. range. but not rarely And those say They millions or tens far four-year are terms of in all four contracts five-year -- when be long-range of --

Timothy Savageaux

right. All

question product that standpoint, Sounds question an X enable good. ramp? happen from guess operator, Cambium-specific Last on And is, or my to from need gigahertz. more does regulator, to licensing standpoint I a

Atul Bhatnagar

feel Excellent question, very product view, we Very good. From of insightful Tim. question. point

as I said, customers say, XX approximately, we we As have I beta to close would speak.

going do. something So to this we not is are

to STA volume. software. Special we Authority, that be in like ship POCs license the ability doing We Temporary production will And to as and going. is what right units said, This now. QX, used have FCC's will And will I are be get production

needed is think FCC and coordinated success more spectrum. I And got algorithm, is the testing is from CBRS AFC months a for probably more band. X a gigahertz good -- what gigahertz next for is finish of experience the the X.X tremendous to story has evaluation over FCC a the CBRS. six

be and FCC operational start think they early I'm guessing, all want QX, I networks. those then because is QX, there, done, end to sometime somewhere operators see So can allowed see money make that is of for to will testing in, you're going what when high-performance it to this

be by be ready affordable. to So is providers multigigabit networks, FCC together be ready management, with and with are the to little products. needs Cambium I enable cloud be done algorithm, ready And will a which think Cambium will service with ready. more will AFC very working Cambium Cambium the

pushing in ready possible great will we CBRS side, X.X our gigahertz. did QX. we and be with and our So And they from in job everything are that launching. to educating And a be power doing FCC

as So we're confident. not algorithms CBRS And AFC very sophisticated as is were.

think they half. they gigahertz, first in this if with great could CBRS X.X I a do job So did on

So we feel good. pretty

Timothy Savageaux

much. very thanks Okay,

Atul Bhatnagar

Thanks, Tim.

Operator

conference Peter Schuman I This for to any concludes our the question-and-answer closing turn back to would like Session. remarks. over

Peter Schuman

Jason. you, Thank

company Jefferies August virtually; at Sachs on (XXX) you Research, Semiconductor, tour Xst Infrastructure Communications QX Summit During XXXX Chicago, the Conference September with XXst Internet the will 'XX, Oppenheimer with Department XX held a Cambium XXth you for any in hold In Technology September Investor Relations August on questions joining us. Networks the earnings facilities presenting Cambium be today's will are at Rolling on with present of at meantime, will the meeting on Thank and our and at and XXX-XXXX and Francisco. Conference Hardware, Barrington IT to the in XXth contact And Communications Goldman that one-on-ones this our Meadows always welcome can investors call. concludes headquarter San arise. host

Operator

for attending today's Conference you has concluded. presentation. Thank now

disconnect. You may now

Cambium Networks (CMBM) 7 Aug 222022 Q2 Earnings call transcript