ARRY - Earnings call transcript Q3 2024 | Array Technologies, Inc.

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Operator

Greetings, and welcome to Array Technologies Third Quarter 2024 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Sarah Sheppard of Investor Relations at Array. Please go ahead.

Sarah Sheppard

Thank you, and welcome to Array Technologies Third Quarter 2024 Financial Conference Call.

me President Kevin Zhu, and Accounting with Neil our our call Officer. our Manning, COO; the today Hostetler, are CEO; Chief On and James ir.arraytechinc.com, our is Relations webcast call and from Today's site being at including audio slides. Investor

to our of release on Today's financial our found quarter can GAAP visit financial to In of has non-GAAP includes on website. results We be detailing company. non-GAAP the current arraytechinc.com been quarterly our encourage at addition, measures. throughout discussion the results for press posted information the A you the website. website on reconciliation measures the most

are that to file recent results documents XX-Q, As the uncertainties discussion that to cause the reminder, today. our include materially our and risks made actual results. discussing most today including may supply, risks forward-looking statements statements affect statements differ you expected a results, Form a matters. We subject we market to refer other demand from matters may and regarding with and for our are SEC, future forward-looking These the we of

we guarantee Although of results, expectations that performance, forward-looking in activity, achievements. future or levels we reasonable, believe statements are the the cannot reflected

of under turn actual the We update statements to call statements to no Kevin. these are over results. to conform duty the forward-looking now any to I'll

Kevin Hostetler

product update, some once Thank on you, provide X, line the revenue, gross which business. financial the up highlights Manning, achieved Neil highlights then our begin I'll dynamics execution market financial was commercial guidance quarter a market we Then the Adjusted structural then Sarah. came of third Officer, then year to which for President Compared the quarter half third XXX-basis upper and both again will we'll quarter. XXX environment. Slide questions. Good Starting $XXX on performance margin solid the financial included the benefits and afternoon, Chief with and up your call and saw business everyone. from In the adjusted with We to tubes industry and guidance. margin Today, quarter, updates I'll we the brief the full open our improvement. the wrap and summary and XX.X%, point and Operating at for begin in a the reflected of fasteners. I'll latest performance million with our call. last range related of some discuss prior near-term provided year, gross in earnings and torque

cash generated the a million. million balance adjusted representing of million $XX.X free to delivered $XX.X and also of flow quarter EBITDA, end we of We of with $XXX XX.X% revenue, cash strong

Our orderbook end consistent to $X quarter. at the billion remained

of a orders momentum the of factors, opportunities projects was other uncertainty the this of over awarded muted Xx overall and remains given our market domestic strong. At election the business bit than While quarter end, end QX of of in XXXX. market at quarter's the total number and were overall the the larger pipeline

solar. want X, total one remain industry trajectory internationally. solar the to its trend It's addressable for and market new Slide our growth win this for of seeing the time varieties to of the recently the higher OmniTrack product an portfolio. product options terrain is more and than believe terrain U.S. continued market take our traction Transitioning promising the both I XX% great expand to rate continue to order than historical indicative talk energy note, in generation. lowest cost continues tracker with book. We our represents our the to we're now through Of wide share, to Our used of success impressively expanded following global now being be exciting projects, for the of and of for

first remains solar demand the XXXX utility U.S. capacity remains scale to EIA the solar additions half the Based all in all beyond, leading as close at out data, we in believe planned new on of remains XX% electric XX% of to of additions with Looking the expected additions source and value additions XXXX. to approximately year of new the that well. robust. data, and According solar for energy proposition it's

outline We continue remains largest solar to options scale rapidly to will that growing the as of to new various solar generation years lowest come the cost in of energy one needs. expect be energy driver the utility satisfy reports that

general these continued the emerging that in for for particular legislative in the green bullish and demand, industry with are and bright as support demand coming datacenter We coupled AI prospects tailwinds such Array in provide drivers, energy will years.

are Looking to next scale overall few utility years. growth on nearer-term the speculating U.S. many installation growth, over

projections between specifically, XXXX. range growth to Looking at mid- from single-digit high third-party XXXX

However, look to the for we anticipate within double-digit we due elements. at strong Array, year our business growth as ahead several overall

And of significant over is between order end XXXX. deliveries First for portion our book additional next QX quarters. I'll still book we of you, for the remind all, a will of still few XXXX through XXXX the scheduled delivery

to our us timelines. While with engage assess to we continue this provides strong project customers expected frequently visibility, with

Secondly, positioning largely U.S., driven win encouraged continued our this of Outside and are on by rate markets. also encouraged by by offerings. our and in year, focus product we we engagement international the the strength our differentiated innovative strategic in customer remain

market and that share near-term XXXX will ability. been to distributed we best of to To projects the to support our confident and Europe, consultancy to the ourselves has In success to Brazil. recently are in set leading the in continue quarters. coming will growth we up for challenges market share our that growth greener navigate continue beyond end, for support boasts customer in targeted confirmed Array overall data instance, generation while demand activities that modest, For

I elements about we're the have specifically want to XXXX, to had the contend. current to length Slide X, customers we've dynamics project market which Moving In U.S. talked our pushout with various at cover seeing.

persistent have will continue opportunity challenges, to labor incrementally of headwinds some and breakers others more constraints. Looking be while include we believe permitting into to head customers EPC more navigate we shortages delays, the future, these improve that may transformers, dynamics and circuit to and interconnection as XXXX. The high-voltage of persistent

are industry around interconnection there project improvement these timing a in improvements the with the queue these there we for lead have in early of number seeing more that as said, times, take is cadence. manufacturing implement practice, times are lead of to optimistic we at to move although Similarly, these much that it capacity Although normalized and permitting factors build move will out electrical a believe That reform, to are changes customers in projects some regulation time long facilitate discussion along need additional will we for equipment, signs incremental components. being that to potential time forward.

cuts. encompasses The environment financing first more interest Reserve's factor the Federal the to favorable due rate

tariffs on should advance allow projects clarity final more with to certainty. Additionally, AD/CVD

is also to industry While factor have the whole, delays in with associated past total AD/CVD-related selections, Once industry the overall see this uncertainty The optimize in a later total understand commented rules panel this to with that sourcing their tariffs strategies for project as plan preliminary panels. surrounding to costs XXX issued incentives assist project in is impact which overall customers the the support final costs. better represents specific released to they participants developers their around be IRA manufacturing and we we solar costs domestic the help cost understanding month, October evaluations. biggest tariff-related should long-term in antidumping the these were believe tariffs determination Further pleased as related the initiatives. total clarity their negatively scheduled of can on returns. We

and Specifically jobs the critical good-paying Albuquerque domestic for Array, XXX manufacturing through our onshore credits new our helping are facility. components us tax increase production and

rule still as had solidified. pleased Although the inclusive that did we are the not fastener category be of XXX final is to our of advocated, broaden clamps we structural more

to additional content reminder, structural very domestic Treasury of rule, included the Biden a clamps data, domestic the guidance currently for through torque administration before elective more. our update guidance for impactful of not domestic guidance. did we improve continue As releasing end purlin current additional the tube portion content, credits safe We within feel assume recognize anticipates final this a be have would our XXXX We our the updated longitudinal to harbor fastener. considerations. clamps view to On the further table. as of harbor Under our helpful accuracy XXX the for content. We clarifications, safe adder evaluating orderbook definition elective guidance significant customers under in definition the guidance will be project domestic the this technical make and that pursuing the updates

performed confident that solar first our that support we Trump industry well under remain maintains note and would administration. Finally, the bipartisan

bipartisan Johnson provisions are opportunities of The both to requesting as energy challenges districts clean the support critical legislation have is the members jobs any market. a the in domestic solar component Speaker effort. credits IRA Republican the particular and these portion exclude alike. evidenced Democratic there at deployment many protecting is manufacturing by Notably, navigating of of content Overall, strengthens the domestic accelerating bonus growing that are that for in across a IRA and energy utility-scale repeal length from currently in the while country. there GOP the House We credit customers of and number how are incentives creating tax paying for good discussed opportunities

XXXX. customer see worsening, important stabilizing, U.S. of it's level we that at witnessed to market midyear not the the However, note from we pushouts

exciting over product Now commercial turn to I'll to and updates. some speak about it Neil

Neil Manning

Thanks, Kevin.

to broader context here. a record Moving announcement of Slide tracker I'd our to as in spend recent of XX-degree few moments innovation track the the on like X, talking shown our

protocols has reducing our and and the of the of production by This angle challenge hail imposed of response and from weather To concern site. track our stow with feature record by alert from introduced design drives put unprecedented context, to solar tracker do Array introduction OmniTrack stow we events to both Wind XXXX providing mitigate protective to rising high This Providing remains proven offering while to Passive the competitors. new industry. steepest protection frequency solutions our hail With the Array our top provided to hail our compared energy our risks our the wind damage innovation and reduce this the risk in increased in Stow we to X% by with DuraTrack and efforts. responded will best DuraTrack wind, provides capabilities premier our for loads, and products, in with extreme to the software. flexibility significantly a up industry, the in on providing active and customers stow a solution enhanced SmarTrack priorities damage is against stress when of hail first one the many customers our

allows row in torque relies to wind individual the rows track This suite of when alert our site to year, tilt services third-party part to than position. in for technology, response continue position hail allows software normally. from differentiating results This Oftentimes, the higher Passive integrated net defensive a which maximum competitive move gearbox. at threshold to one all Hail energy Our the allows rows production architecture unique clutch wind controller Stow a a the with alert weather at a a we offerings. this interior through introduced on stow while Earlier rows is move to exceeded predetermined patents, move as this most storms response away solutions. is timeline. to direction tilt position Array's key for Wind exterior to a a of of SmarTrack predetermined tilt of moving to the rows high and

Celsius, and the does motors a on be use year, interruption reduces SkyLink which power works the quarter require array weather grid to architecture, so. area. to the operation, damage, SkyLink the from operate continuous kinetic this tilt facilitate to and cell an degrees string the an to importantly, impacts do X-row seamless we DC down wireless launched minus even Zigbee breakage batteries when to solutions. modules glass significantly hail power featuring with And in the and OmniTrack the third of to of reduces Moving of SkyLink our In powered existing Rated provides XX module to may solution risk communications. not and impact there high to energy provides DuraTrack SkyLink due the cracking. the

of events Damage of Array solution high experienced risk rows from to the and Finally, provide incurred. snow, weather the within and Investments of extreme half to to total than before other available critical launching a but reducing solutions that another stressing as of ice continuous year-end, snow we'll our to mitigate snow snow events. to the due these financial solutions happy damage weather patents to accumulated innovative represent high small by our these number in refreezes. uses risk insurance of validate alleviate of on-site as platform, the and the to scale SmarTrack loads claims eliminating PV sensors be well the software will we investments our modules and and part to over volume say industry, protect snow the more and in that severe dump only tilt team. I'm from utility develop represents on since will modules claims are to XXXX move solutions hail concerns response, PV utility-scale delivered extreme any sites from significant, formation XXX risk which continue protect to investments. received melts the damages be protect and It enhancements insurance weather automated

from design architecture third financials new it to SkyLink more SkyLink a and product opens XX-degree With that, tracker more an provides. increased flexibility that also we've advantages already insurers over on thrilled sites very full in received stow to has in Additionally, Kevin numerous in customers quarter the of announce in by since September requirements eager our feedback turn light won Many Kevin? hail-prone the to year our I'll RE+ offerings. the customers to Array, were we're receive praising product for its for with fantastic a QX. on fact, learn forum been latest to SkyLink and launch give layout guidance. and our regions. about conference for order early detailed update provided in back well site markets

Kevin Hostetler

Neil. Thanks,

start Moving to to third by the providing off Slide details around results. I would some like X, additional quarter

which year compared XXXX project quarter coming and experienced in represented prior of North experienced from the We of GAAP revenue Basic $X.XX resulting long-term for our year. in quarter an down market markets U.S. As remainder in million, and per income the our period. our both was EBITDA the adjusted EBITDA shareholders mentioned, million basis, America we've the was locations. declining a coupled income net of $X.XX was previously per I the for to we of compared adjusted pushouts was million volume STI within the of This third Operating diluted of share an to third share capitalization, delivered XX.X% update internationally. period the $XX million EBITDA the of loss an charge net to the the same year during diluted in to EBITDA representing of ASPs in in share the basic of $XXX.X sustained points $XX.X the net XX% period. increase year-over-year. approximately attributable the operations. a million goodwill compares in range last net adjusted million, and million of with third from for million On revenue guidance per over stock year-over-year same basic year. common XXXX. quarter was third approximately was XXXX, quarter QX, triggered driven to XX% largely and the a to international noncash $XX.X during $XX.X $XXX.X income of $XXX during by income and the to of was of million and in this STI XX.X%, were million XXX goodwill projections We versus $XXX margin prior in loss quarter decrease achieved with adjusted revenue adjusted year. This Sales impairment gross the due of compared quarter, diluted certain of in $X.XX charge previous expenses The to of $X.XX up decline margin improvement Adjusted and by $XX.X XXXX, basis XX.X%. margin was million of the half from impairment Adjusted XXXX $XX.X third $XXX price our related acquisition. second period

last for the same Finally, our period the $XX.X year. million free cash flow $XX.X versus period million for was

Now our update detailed XXXX Slide provide to go X I'd full to guidance. year like more and a to

that within within of occur we customer a timing last addressed different could base. scenarios we our number carefully our project As guidance year, revision contemplated

Although narrowing outcomes. we top certainly the those see shift guidance some $XXX continued which of we was range our Notably, guidance pushouts million million, have project potential cancellations, not line expectations at weakness have some projects last seen did revision. in pushouts, resulted the accelerated see To negotiations, due of level $XXX the be considered the abated in to projects our not to our Brazil right real the to impacting PPA and midpoint feel since only U.S. shift substantially our some to this business, domestic of we within project we customer to within clear, in from challenges year. our witnessed we continue

We the additional given changes ranges slightly, our project and are in income lowering narrowed EBITDA expenses. net and increased adjusted guide and nonrecurring a per combination share overall of investments adjusted strategic within mix topline

record are for and adjusted torque we've able tube to XXXX, fastener largely We the been of XXX XX% anticipating structural realize. approximately due margin gross annual benefits to

a transitional benefit some recognized this year with As XXXX to a XXXX shipments. related year represents XXX for reminder, catch-up

Additionally, charges million investments which adjusted and be within some nonrecurring guidance, our expecting $XXX increased are look G&A the strategic making to we as framework is now of reflective between we we million, are $XXX of to updated to expense XXXX.

tax effective impairment anticipated charge, XXXX of the reduced credits. some given tax to XX% and excluding a mix income R&D-related expecting latest now our are regional We rate XX% goodwill additional

year. pleased prior of $XX $XXX on guidance $XXX we to to capital enhanced given cash our $XXX the range raise the million to to million, focus working million flow million close Finally, free guidance to are our out improvements from

on profitable, as incredibly into and of mentioned, the ahead, I'm proud efforts continue growing, to fronts. business cash-generative we highly move the we team's year these I've As a anticipate

provide thorough I initial to stage brief final CFO that an of interviews this candidates. in for Finally, impressive update the of reviews, were have our of want the pleased the search. and slate mentioned to We opening last quarter of process. very we're line before process on a entered vetting we a extensive After questions,

set business more for and this for and we time, our I we to up confident who the coming employees goal can't their years, the details very at disclose In look company While feeling the as line. we encouraged are our of the at opportunities conclusion, proud time that success. near I'm are dedicated future efforts have in

by We momentum, will product as the manage that, move within business elements call operational customer on engagement, Operator? innovation and to focusing open our our questions. continue With execution the forward. for will we now control we

Operator

(Operator Instructions) Jefferies. from comes Julien The first question from Dumoulin-Smith

Julien Dumoulin-Smith

been realization? comment of wanted to $X I the here. that updated that imagine are pushouts, still. it you here. level think And How Kevin, cadence here about follow on you think mix quarter bit if out on as delays mean, will? layering that mean probably spoken up a backlog both the I there's billion on you on 'XX how I obviously, bit billion? that and comment of you will, you've the Just the with in revenues are is evolve moving a was $X together you seeing if I terms here. little the little things pushouts that some Can thoughts through versus Any last coming within realization? of and in in

Kevin Hostetler

pushouts period had is to that about push. call, X acute that all, Because with the had plans only that of second say, put Julien. making half once weeks business, period, I reflecting projects number pull-ins was updates we level and getting delays. X we that that always the own and and in what in their quickly could of Yes. business have their we you their quarter's of a we our through to I saw got the more the returned what a we pull-ins I to a cadence a where last forecasts more plans. And had to and on that pushouts evaluating that call Certainly, historically. back that cycles that as could customers much a the of very Great question. and normalized and realistic some couple Meaning, year very talk very Back first of we a project normalized Thanks, and period to look, would domestically, that thing of always we've internationally. to had of normalized pushouts pulled level, But seen saw level we've back quarter some that progressed. projects in.

about a that's of -- difference left this so quarter for already I of to, orders to And said way. to put XXXX we is of in plan, the executing stuff about convert of we last without backlog that a and shaping and strong We the good make really This would that's again, quarters, for sure regarding XXXX due you of think a we're points, very couple more able commentary It's end backlog what lot we'll our we that growth we up point. about this really number. for feel feel consistent. be look, be we at being good very us. percentage going growth. operating so be what's XXXX, where about And good go-get it for consistent couple feel gone a strong our was the think that communicate in time up to if XX% that the certainly up there want is probably of the between XXXX booking to but still still and QX

Julien Dumoulin-Smith

quarters? last kind is the as that Is And rolling comparable is still Kevin, you same an about far the of revenue for being over implied clarify apples-to-apples 'XX there, comment the backlog to that Or that just X as goes? total on kind talked basis for that intact. the of XX% period

Kevin Hostetler

little Yes, it's apples-to-apples. Actually higher. a bit

Operator

JPMorgan. question next Mark comes from from The Strouse

Drew Chamberlain

Mark. for on Drew It's

the on 'XX. realizing confidence in to encouraging want Maybe commentary giving hoped a have on that just appreciate projects and anything you the project But alleviate confidence that kind these hinted somewhat are on pushouts what's may to interconnections you maybe as giving is into in not say you as happening on previously, 'XX? just talk you and can Just bit better 'XX? you might going follow what that of you up little the and can be getting

Kevin Hostetler

to at pushouts we think I our in be in XXXX, what setup clear, pull-ins to 'XX normalized say would in still think cadence. if to look 'XX, go-gets 'XX, and is of the level difference still we of convert plan we about And had our at operating that I some our level needed we you the beginning be from it's Well, had, our all the of there of deliver already. kind a XXXX of our back in still The think back plan, to year. will as we half in our backlog

about So make we additional that backlog. is quarters few in in us a bookings convert business to good converted of XXXX. needing see already feel pretty our more Plus what

I better project think the we certainly contend XXXX XXXX. some of their as really the equipment, go-forward we're and is validating the with time getting into and labor for than long feel shortages. some market And lead able timelines, did their now to I of the we about think plans our most of to customers setup closer coming

Drew Chamberlain

Okay. Great. then other. just one And

talk On than or and write-down, you just been year there? what the about so have what's expected markets, the what outlook longer-term of into mean can I what's being would changing, STI revised went maybe ago? different kind a you

Kevin Hostetler

Yes.

and our area Accounting this Zhu Let with me Chief Officer, is of -- have focus. real James his us, we

turn him ask Let and over to you it answer. great a me give really

James Zhu

a the Julien, triggered of pricing, you're Brazilian weaker Kevin. look the you experienced to you the translate if -- it When relook think devaluation at that real, the have and just volume, you, us U.S. for real, Brazilian look going Thank when it recently stayed at have to in same. real, at market revenue. a participated dollar, looking accelerated the I the that to we Thank really at lower you Yes. you.

I trigger this. think that will

to little projections one of capitalization. outer years, a rejuggling the the terms the market so that's In kind for in outlook or of addition of events. bit That's triggering of triggered kind the

Operator

Lee The Goldman next from Sachs. comes question from Brian

Brian Lee

throughout double-digit talking encouraging price, you a down, talking Kevin, good growth, that's volumes outlook, us up, done the about sense, I to strong 'XX year Can guess etc. volumes job on you've see. about a give the

'XX, around view? the How pricing your about get to baseline double-digit out on And then the international? here year-on-year pretty that it for the you're does outlook think what's kind shake a like strong you optimistic. As between thinking sounds basis growth of to U.S.,

Kevin Hostetler

guide want to Look, in say so out what not of Yes. numbers feel about already really I discussion. that's going too I be go makes is backlog. don't far But we're coming to careful today, that XXXX I'll us our good those

planning We pricing in the to really now just that you math, have the If already the that mentioned higher feel good of that. in for double-digit our visibility about and already in that delivery. earlier, don't we it's think you, you year. we've our next not feel help backlog And SIOP if about have that, we the given already from about already deliveries is process, a any a for go-get do to guidance I you This at fill and steel. scheduled a orderbook orderbook, Look, already gap. really there's see of the looking in already about we strong good frankly, growth in lot sitting as

we're we've primarily to terms and those investments business on for the pretty We They've not. next booked in been in about these margins, remember shipping margin, good date. last it's to operational gearing, the front fact, the feel making year orderbook even X in of about. points orders set we our end In been And would that good on volume, and price be with that quarters have year. X feel are expectations our further shipping consistent every Those but next to the of those setup call the will acceleration.

Brian Lee

started you year. the 'XX. in margin be view mean at kind And and exiting topic, going you're for the Okay. the comment you year. you into if least another low of On the XXs kind for catch-up of XXs you're math, skew out that gross that raising numbers the to back year made the the the some I high credits

kind that points QX let's representative of in the the we average of going think reflective QX of run I you bookings backlog? the past these As run rate, Is are your about with into as quarters. you're 'XX? the kind price say of the in seeing said, couple is you're XXs, seeing be think you'd low current of rate over

Kevin Hostetler

Yes.

that's going going obviously, guide we not be but certainly year margins, an say project in margins VCA that large I What more negatively -- you. I low-margin through we impacts is ready to XXXX And what margins. sequentially, VCA, project that next related I'm Sorry, that QX, process will against that order get thoroughly to dip come be our of slight is a you'll see a inherited and to primarily until I'm in it old by whenever our have large very I'm from careful. for orders have one AOP VCA. to again,

really through of what ready bit say to that's seeing margins operating would for anomaly, you're QX. it's I our next an in year but get guide not until yet So a we we're process.

Operator

The from comes next Truist question Jordan Securities. from Levy

Jordan Levy

follow-on kind had, as in shifts following to out structure on you structure? maybe that, there last see any you VCA extends? can just sort versus of far I wanted just maybe a sort just of that is EPC on there's of then additional been timeline any the VCA give to question if how And

Kevin Hostetler

we the projects we'll extends of XXXX, VCA couple the actually It No, remaining there's price of only lower in and end is the and this this I are against probably that was between contract company. through ship signed XXXX. more now that fixed It in think a the margin. one VCA have

Operator

from from comes Jon The next Windham UBS. question

Jonathan Windham

the to just I'm risk behaviors administration in harbor. to try and you safe potential customer if new changes in ordering the attempts anticipate any given their potentially wondering under

Kevin Hostetler

to it's right? help can be do what that. for that's given accelerate to our choose way too strong note far what new, of domestic tell acceleration to ready or too certainly behaviors read of them need they the on do, like we be customers last think be different to and that. it I supply far any you, We truly early It's in serve good they If we're hours I've ready too chain. that. our fresh No, We'll view to evolve, XX a every may in Certainly, have customer possible delay, don't that, just served.

is of determine tariff I we clarity customer rates. around to That's by cleared as expect pretty we've into the causing the the AD/CVD good about get biggest around We are discussed pause. Again, end the what cadence continually and year. being will year clarity that as think cadence of domestic the the content year. we thing feel elements that next up the orders the these exit

Operator

The Roth Capital question Shen from Philip from next Partners. comes

Philip Shen

de-grossing much or questions of And what in you the then First expect bookings. And then have you or the we about how share be Can Do gross for de-booking? calculate QX? $XXX bookings backlog group And second do in QX, Brazil. of you to group bookings that around bookings any so Can right? how share for is for sound then of latest is transition about your does Brazil? million you were QX? questions around is

Kevin Hostetler

and quarter order flat rates. $X slightly that the at AD/CVD were Look, uncertainty around billion, also and what the order the projects we've Phil, our election awarded pretty activity and clearly book given muted in remained said is

quick with have the our customers. that We're with seeing orders of about momentum We're X the an that We're orders years win at momentum. that customers we're rate was about that we so wallet perfect point. historical which of site is good what that with, really seen to in winning in market accelerate. new feel momentum probability is low than customer. this we SkyLink the year, OmniTrack excited business. to order we about the order that than winning hadn't about we was geography continues that last opportunities The all we pipeline with with over kind our won that over excited And significant. in to we of some call And higher time this of up XX% in installation, a front with solved time. a particularly in we're We're excited excited a at less share. of over customer's most had that cabling, a over years SkyLink about share that us targeted end in needed on And X of year-over-year, we're larger, historical new excited problems what our be pipeline it QX We're particular excited customers overall the it vis-a-vis fact the X.Xx over on a is of early first opened they customer our U.S., we larger continuing incredibly the not the Xx received think again, I hadn't for. fit targeted and our higher looking backlog now is this

was second particular? Brazil, what on and in Your question

Philip Shen

Brazil? Which is the of backlog

Kevin Hostetler

broken we I Not provide. have metric by -- region. we don't historically think out a not backlog

Operator

comes from question BofA. Gosai from next The Dimple

Dimple Gosai

some a per there? margin you that $X.XX speak you more guide components new for change extent, What's included think little kilogram the was there didn't could level Can in that where versus quite it your qualification. guidance definition. out, components the of qualify the kind under manufacturing final about qualify, seems some $X.XX optimism To that bit whereby came I for of additional

If you would really helpful. could just give some more be clarity that there,

Neil Manning

around of is take a content we'll of able year content. a be is not XXX%, already We Neil. QX Really domestic content. XX% from feel domestic which This first we've really I'll that that big the better And perspective. in this We that shipping we established were or to well announced last announced to in capable to domestic get half XXXX. provide of one. lift

of that, to reference a that number from gets our Cable capability a components. into as provide Now One to

where with for domestic suppliers working we're before, to were from overall, target. really domestic to going first not But of mentioned content. few a I not And We're sources that many to out of suited feel be break already nondomestic suited. As providing well already. position in well fully really we those QX, margins XXXX we're ready we're that content specifically a domesticated for half versus that

required As the to feel of of customers so have current meet that be and solidify they guidance XX% of really for or level it. customers, we we've planning talking their our excited part able able look to to our domestic solidifies, we as And with about quotations content as XXXX. some been think for those requirements

Kevin Hostetler

think the of hopeful discussed On but had, we credits. our call, at I we're were were any the purlins clamps. the I question under XXX to language considering not in And we not particular, I'll so been last And locked you're that that, change to regarding specific referencing we think already answer longitudinal weight had position the do stone. to They structural clamps be under last Unfortunately, a what in clear, back could of not be original that forecasting tube But not and put this the clamps we're we this so through into or lower that point. at that level. get round a classify found at delineated the again, by definition credit. torque of therein was higher would level satisfied fasteners they portion in under a was level, higher guidance our quite

we're I on is fact to clarity as that they focused of forward, allows our about that can able move the excited at over just to things of think things portion point. We're are. now now this more on And where what is book that excited deliver forward. And understand move for level that level our being as Neil customers. people some that content indicated, about -- XX% focused order domestic of over we're

Operator

from Osha Joe Partners. from comes question Guggenheim next The

Joseph Osha

of impact every another? the is see could November to treated your that and how equally. How panels one out one we with from much AD/CVD things does is challenge business? often that maker not see And that switching developers we module of Back a 'XX, to vendor

Kevin Hostetler

Yes.

us, really for we're think about I excited that.

we're a that about you AD/CVD, and not been site a since we're way this tell now, this can I year a a for when one-site vendor giving design. the designing First, has

is customers us One site and have designs designs X on which probably our strategies for they're or used happens quotes that you And internally X X we've those historically of supply X in different panels. X for to X and their move going forward. giving different then different been varying panel clarity you with panel rather to and pick choose of doing understand chain unsure They're And in supply the our give we once will that economics end. designs. make chain round designs the now different customers have of those are is months they or We're asking we're design, quote, under choices, of AD/CVD one challenges so. for customers X different they X next those for choices Where different X our doing that multiple we what consistently X panels. site

our if have versus without that so clamping systems, several we other We benefit tubes. our to don't in the for the us the feet you slide or out level and torque fixed that have redrill to or do those on is competitors the positions to for tubes needing in our Now unique we into clamps industry ability drill preset field. that need torque flexibility torque could to as greater right tube, slide but left the much be, of inches, a don't

Our an multiple customers able array better getting and to competitors. panel And ready our we're giving in those them such, of to selections process. with make the selection designs them panels can late do late be system as than

Operator

Citigroup. from comes question Vikram from Bagri next The

Vikram Bagri

Kevin, mentioned What leader that in of a in question, orders in terms cash any? of your you you order do taking Are are if payments? terms some for percentage guarantee you can down And about customers, market, you talk you're any every Brazilian outlook highlighted that of changes market. to sort have there contract you with second receive?

you by you where in goes broad you see your as XXX? of you know gain talking If sharing you are customers? and with you gross we XXX Have growing 'XX, can giving just percentage how some margin guidance, final for year-on-year XXX just about market 'XX, share growth outlook, more up then any shared talk Brazilian share you're can wallet cases margin I market? you? goes see of XXX, do And customers. about the for any thinking question, gross have, expectations about in you in asking been about thinking that about gain terms And but way? cases margin in gross Not you've still it with healthily right think you wallet absolute should Have up we in your the more that shared but down,

Kevin Hostetler

say to the the over explicit have turn take order as those give it unpack he'll to first currently answer Neil it operations, going And of me couple, the We're no sharing XXX our we on Brazil. credits. let that I'll you so Neil within again, which Brazilian question. better and a Great questions. requires I'll orders all book runs

our later Now our at doing well, we're benefiting Q that and being recognize really said, And our you today, domestically look credits. XXX really, we are margins from when margins. strongly

about XXX. of are It's getting you'll opportunistically to customers situations. an is some explicit And competitive our and And pass Q business. margin additional as providing at our utilizing about I being sharing on pricing, to realizing drive the competitive point. We that agreement well able ability XXX. we're use of with that good some see outsized to that us really, But benefits mindful it we're this. We more them the said, more domestically feel going this that really really the domestic of in our margins are in not

I've at in routinely have as that are have those occasion couple year, gotten customers that. put over and things get with that, terms on on the penalties negotiate may contracted, project the are elongated the cycles initially, we couple cases, a The of Look, customer relative may customer early initial And only to shifts something happened have full process, behaviors It's year could closer look, and as we I all. that's on reduce XX% a was very in say we've additional say by of this a last goal in deposit much less conversations the kickoff. down a were backlog lower payment us of fully associated fully deposits means gone with seen in percentage a or contractual requests. there where that's that element second and to terms Historically, question in worked will not XX% delays, had early. occasions willing is real what to to our to as question provide couple order down But about contractual nature. then to and our one-off second of material of really I've or programmatic really deposits they I total. no too cancellations, contracted, terms. we where you to always time customers that of seeing exceptions down

to goal going I'm prior do backlog as Our pricing. focusing locking continue materials contracted. large always to in to order that, certainly much our to customer is and that on practice we ordering get fully deposits continue We're And our of as happy have and off means it sense? the say really even half over with that of do because upfront street my on make if want that penalties. Selectively, I'll contracted deposit contract I that that Does turn historical my fully an to willing order. and to books Neil. we're in a

Neil Manning

over about the not to me guide Yes. Brazil again, XXXX, a let on going talk And what little context for seen year. topic, but bit the just of we've this

of in pushes of lot midsummer period that's during saw As same the we the timeframe. point, But largely out. at kind earlier time. in settled Kevin in saw We some of year, project Brazil a this the the mentioned, in that that

into for think do XXXX. this going well to certainly But We change then again, seen Brazil that of market pick for as share also think where rate of couple going to quarters a provider up grid. We of we're There's in lot of It's factors. that's the now the number confident that so early of a out. to the we we well, quarters that really feel in is a well that curtailment it's settle DG position things power do as take been things taking up that gained the settle largest feel at to We publicly since really dynamic Brazilian feel working of currency with the obviously point positioned we pick noted couple it's place period summer. challenges. there. There's haven't through we to We in from XXXX some And do out. left off. our a take But positioned.

Kevin Hostetler

utility XX leadership We team has that's XX of in doing shifts very years add, to This large Brazilian recognize scale seeing. great we maybe our up last hundreds period between can Neil's we that projects very, the couple X from from that projects. over and see. is to I market one done of a a XX-megawatt between the period you're when I shift set and the under of means year DG job If XX things the large and to Brazil going think XX And allows the X and business projects. quickly what you're model or literally a that

down the us a at very our operating market. business increased have term, there. a market when scale Brazil, And pivot in in tying of of for Brazil I that that's the quickly utility the we the the immediately the getting throws over to solar share in seeing down process the able points. portion shifting business largest for is able our And DG lot and full to in in share being little you're think strong shifting what 'XX market date. You're #X success bit big that's in to of then pull market near whatever a very, to utility, to It's quickly in of gaining share DG the results Brazilian Certainly, team utility Brazil market the seeing in in really thereafter being a market bogged share. that credit X very 'XX, efficiency is shift in the gained model of note scale percentage

Operator

from Piper Harrison from Kashy next Sandler. comes The question

Kashy Harrison

philosophically that's for R&D and what and you, sales the appropriate as both relative or what think quantitatively, strategic have about have the one you think or business, qualitatively How do about Just SG&A me, whether you to of you? backlog Kevin. for level

Kevin Hostetler

to changes funds new the up orderbook, going so mean finally of period. I driving we high We're out finally new organic we when strong fruition some we're to and degree believe brings them, product Relative our of product team We the I some in to pencil continue we started That's a that accretion development. that right? ago nonstop. to very of will seeing through that best differently, years growth X use with that. them, showing buckets fund forward coming is our really of got development treat the in Yes. meaningful R&D, tied as and period, revenue projects here margin the

to get advantages I say the business, last those have opportunities in the months internationally. think X the SG&A prepared think much more referenced that to the in new and business market. had We've adds relative the the time. our bodies to "strategic added into just front in continue about to talent X sales out coming our superior the U.S. the really company salespeople much to several the We've front we investments" business. on We're named, that on leadership front some already our some in getting to of been this the end and Certainly, of what end Look, word the marketing salespeople both got and marketed last flipping officer we new Europe. in the end new of and added continue accelerate front in getting is that's found business out business. product of in I of end We've sales aggressive We've for the of aggressive. remarks, investing ample place, we in product added in our and our coming specialists help quarter, about marketing more if in we in just targeted U.S. business, commercial in us

Operator

The Oppenheimer. Rusch comes Colin from from next question

Colin Rusch

as and any the curious pricing seeing dynamics that. of and landscape terms I'm might reduction be from peers your how of you're that about in cost a much competitive result activity you the seeing of

Kevin Hostetler

continues competitive this of I us. in competitive the the top historically, wouldn't we're always seeing us. look, few -- certainly big X marketplace say down or we're can seeing be say a much top would driving it ASPs say change not I a of deterioration price. But between I marketplace between to for anyone is

it's Q, to we're to in sharing a there. And further disciplined what at you'll seeing market this some that to point. think fit And our think we've of again, see domestic the even We alongside year. think What at in showing of ensure we're maybe out into look strong and competitor, that targeted of it's room us margins those fairly we've or you on up they're some do close that we certainly aggressive come book. I nothing when even not competitors, of the our behalf share a still to our seeing I our ample got order projects beginning creeping in similarly. is price. feel than price is that's It's war of being grow XXx this fit recovered we're -- behaving some

Operator

next comes from question from The Derek Soderberg Cantor Fitzgerald.

Derek Soderberg

the to a be Is have think maybe type in asked, been helpful. what's uniquely sort this of days. on attached this that? in material? questions my curious selling Do having of but tracker, of the maybe there you early for know Maybe of the you that XX-degree solution improvement terms architecture guys? value Anything on the in what's it's price that of market increases? the margin solution it? is Most of would Is significance your I suited for

Kevin Hostetler

certain note, We and lot at really industry its and storms we especially well said, And given hearing, an the really competitors' X% in our existing specific of to anything industry it's damage where heard ultimately, around and ability the And quite XX% especially the about at about time with remarks. design capable so has mitigate from at needs all of to enthusiasm, or that degree the of significant margin look feedback point. enhancements higher of it's going can lot for and We straightforward a interest, perspective customers September. our which really high it market. level and degrees, to claims claims to drives of use lot being We reasons potential great claims protect performed prevailing customers will going that that really the losses hey, X-inch technical And upon story losses, in out bring are to being And ready it be talked bring it good built in but there. believe extreme great real-world closer current criteria when performed in year. we're a to that it but this damage. set you ultimately of what despite offerings large-size out. industry is of these is in the it short we year, customers, sites. a a platform. to there's and major held teams, DuraTrack get with a there's like to of extreme a spent was for, a like It's they're upon lot not this sensitivity would discussing prepared when offering, spent events. a the of world. degree with comes said, customers time headquarters. are asked in determined asking XX that nearby. degree from our seeing potential forums that, hear kind Of we that an against analyses and us oftentimes as opportunity into contacts forward that really more with from well the there's they got represent that, a be do of highest to brand-new product improve, hey, We middle the RE+ more gets helpful our what's look happening opportunities, amount the there's makes platform, to pretty that Texas clear, customers perform held a to the we what Long from well right a stows at legacy a they be storm, is, weather our be lot our what a really, And insurance that as when events. what it been was said, of that be what real around a to the out extreme hail our Yes. But and wanted OmniTrack is we largely weather this our lot and talking detail look of That to we response in for stow about the being with for us for of are about this the That come Anaheim provides is given set feel forum to to hail, actually, there -- we lot predominant view at of platform, not meet diameter conference being done comes feeling to it's earlier it to coming from year really which for weather feel and worked

Operator

comes Maheep Securities. from Mizuho question next from The Mandloi

David Benjamin

any David competitor impacting for It's your have quick is on bid ability your a foundation one. just companies, for that acquiring I Maheep. With projects? to

Kevin Hostetler

go-forward And that's the in really This evaluating to soil, don't us custom with limitation that them. And and niche. with we with Upper to comes perspective, soil, our feel Midwest. companies are country rocky is there types that there's based rocky acquisition opportunities tailored certain where SkyLink, specific certified any soil and us. have of feel on and solutions work part any those it limitation niche geographies that of don't our was and we from with we standpoint They're other No. the that were world. to it we're in from of with opportunities clear, we're parts market. kind that provider. space of that From of be environments really those for work why position to sense that working certain certified quite terrain. comfortable kind when bought, talked still in to a the that makes around spaces are a obviously and about made, are we're offering, a foundation us to And given to We're And niche

Operator

much this you Thank very the you very today's much. question-and-answer Ladies joining us. conclude for and gentlemen, we session, and end the Thank have reached does of conference.

disconnect now lines. may your You

Array (ARRY) 7 Nov 242024 Q3 Earnings call transcript