Symbotic (SYM) 31 Jul 232023 Q3 Earnings call transcript

Company Profile

Participants

Jeff Evanson	VP, IR
Richard B. Cohen	Chairman and CEO
Tom Ernst	CFO
Andrew Kaplowitz	Citigroup
Matt Summerville	D.A. Davidson
Michael Latimore	Northland Capital Markets
Nicole DeBlase	Deutsche Bank
Gregory Palm	Craig-Hallum Capital
Christopher Snyder	UBS
Robert W. Mason	Robert W. Baird
Joseph Giordano	TD Cowen
Mark Delaney	Goldman Sachs
Derek Soderberg	Cantor Fitzgerald

Call transcript

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Operator

Good morning ladies and gentlemen. Thank you for standing by. Welcome to the Symbotic's Third Quarter 2023 Financial Results Conference Call and Webcast. At this time all participants are in a listen-only mode. After the speaker’s presentation there will a question-and-answer session. Instructions]. [Operator today’s recorded. that is conference note being Please I speaker Investor host, hand the Relations. to your conference over Jeff will now Evanson, VP of Please go ahead.

Jeff Evanson

for webcast. Jeff Olivia Symbotic's everyone. here quarter the you third results morning, to introduction. financial Good XXXX Welcome Evanson thank and

and actual will in include release which cautionary in materially those their financial results assumptions this to based forward-looking uncertainties and the today described and to statements including a risk filings Symbotic's result factors qualified entirety. projected subject of during in differ statements are release with factors the risks discussion in made as forward-looking that are press call statements on Our the any that could statements, regulatory cause and from SEC, by forward-looking

will GAAP of reported our file be section available These measures our the Relations measures are included We press during to to which comparable SEC certain measures these not most allocating Accounting this that used may are Generally we performance, financial measures. under in the assist Investor comparable resources. our Principles, with is issuers. is our in measures which and the these on website of forecasting, release, addition, including other Reconciliations non-GAAP in measures believe call, SEC. recognized as and non-GAAP financial U.S. evaluating Accepted planning, business non-GAAP not and management to discuss financial refers non-GAAP measures In by

revenue adjusted Today, we for will EBITDA. quarter, provide fourth and guidance the including

adjusted net or measure most loss GAAP profits, today which are to the We comparable providing guidance is financial for not EBITDA.

items of for financial reconciliations such and of be our such the reasonably stock-based measures able reconciliations to because EBITDA adjusted are compensation. outside for provide to provision not as cannot predicted, control are GAAP required certain We

by our followed for quarter Symbotic's discuss And joined results, some opening by Founder, These now and with Executive Rick? and Chief Officer; Financial turn are Chairman, we outlook it Chief XXXX will remarks. our Rick Tom Symbotic's Rick third to Ernst, that, Cohen, I'll and call, Officer. today's On executives Q&A. over

Richard B. Cohen

Good Jeff. successfully results. last important Since joining you at for demonstrated ability once. things to to least third you, spoke Thank Thank at quarter, two review morning, we quarter our our do everyone. have financial we us

First, and we achieved record were we to quarterly results We part strong the because joint to venture. strategy deployments. of third outsourcing second, launched report our results in GreenBox able quarter related

bear details. ramp. talk We continues are pleased they fruit these ecosystem will with are to our Tom partnerships, quarterly the about to supplier and beginning and more

excited to sizes. all GreenBox automation billion vision value bringing medium a means while these they two are small we have our interest by great offer $XXX I to for AI SoftBank. to more already from to we how We're customers. and our GreenBox to This addressable can had than many three than the GreenBox So it customers. about technology typically realization excited customers. with adds are bring market joint the more instead, automation because about customers capturing of emphasize year companies higher our to enabled for a want venture large sized all is total Warehouse are years per proposition costs of GreenBox I've value of businesses times of potential for and

Fast two, Go join this revenue to own have business. We to a help of that by SoftBank contract through three, were strategy. GreenBox a us that help capture level profitable capital we backed today; and recurring fortunate Big three of XX% margin highly to to one, partner our as is us in We GreenBox with Go three get drive system the value we higher large streams times a ways; get securing SoftBank; by

could have to if C&S, In than early capital, a I larger the even it in much I today. had -- grown is fact, of C&S years I more if company had

the the on -- capture early adopt So I into more more from from technology. GreenBox value Symbotic’s capital through way and to stream our of also more network. recurring the wanted Symbotic to revenue, decision a made higher pricing,

larger Symbotic. in SoftBank wanted stake a

get I negotiations down As I consensus about agreeing XX% to that to family’s of quite was And what happy at Symbotic XX%. to I do about advanced, about sold more X% value by sell ownership decided $XX. we could gave my GreenBox stake to was to we much with for up, dilution will I to no than shareholders. so able confident because do I'm it and create And

know joint the these we was services venture led, customers. attractive launch so be prospective The will GreenBox to demand of

focus We'll of are we like our our these market, well-rounded us point. to in all While the come would associates, our shareholders, Therefore, as this like who success. to culture, up of won't suppliers we well on the intend this the to customers and I large all and operations as we customers. thank creating continue anxious lose We customer have of Northstar with rest brightly made such helped when customers the anticipate care to to of existing Walmart our are quarter same not customers. get partners, will scale before our a sometime customers and to who take Symbotic is for all launch customers. XXXX, bring happy GreenBox the business infuse ready first which GreenBox GreenBox securing

discuss financial will performance Now and outlook. Tom? Tom our

Tom Ernst

third existing Thank by million. ago revenue growth starts. $XXX you, driven strong XX% to was year and to new on Rick. We execution The grew deployment a solid deployments compared quarter our

with our and streamline ongoing our the continue to through as standardize initiatives, rapid see pace as well to our We in platform of efforts of our the deployment processes. acceleration partnership installation of help deployments,

by of The billion. bringing led investors backed by approximately third of from now the SoftBank. GreenBox to was $XX our about joint last we backlog, quarter backlog week end billion billion. $XX Our venture completed capital backlog total $XX the about GreenBox at to $XX another billion the GreenBox’s adds is

full deployments six advanced quarter new the and initiated We system system during one operation. to

fully and XX third XX systems the in year. XX of XX multiple process and third systems quarter, have last customers from end operational last deployment increased the in we of the and systems the quarter of systems with quarter, of As

Our we sales rapid quarter, add continues purchases multiple from customers. for platform progress new deployments at a and pace. deployment Each

example, recently the and started to deployment progress plan warehouse For Walmart of we with of with five second continues facilities UNFI.

as Recurring at to production. revenue grow systems continued sites. to We deployments operating sequentially have moved now XX customer

than should As grow system our much revenue have and to increase, recurring margin revenue. gross higher completions a systems continue

we business. mix, our to it margin recurring as provide in revenue quarter can recurring increasing an posted in improvement This of revenue a and strong leverage our gross share operating time, becomes powerful

margin the last projects. These lower operations. quarter. reflect The our still with associated significant rapidly scaling adjusted through quarter elevated costs associated gross was of results steel third with with and cost burden consistent pass cost Our margin innovation

loss Operating XX% leverage last of again last growth. X% slower consistent year profit to scaling driven rapidly rapid quarter, along sequentially was This Gross improved focus deployment our as gross by we on maintained rate loss margin quarter, with growth achieve as and and expense capability. revenue a operating compared was X% a adjusted rates. with we EBITDA growth last

securities, sequentially to and cash equivalents million restricted million. $XX grew $XXX Our including cash and marketable

to million zero and quarter of of Turning million first for fiscal quarter million report our XXX with adjusted a XXXX, $X positive. revenue and between the outlook fourth profitable to XXX we of expect our EBITDA

related topics our to to joint GreenBox announcement. like I'd venture address Finally, some

GreenBox growth. in structured at future. systems significant great way Symbotic payment in for us scenarios flow very very shareholders. remote capital visible a be GreenBox allows such the with As GreenBox incremental Symbotic. has to SoftBank. a We million all of of excited contract is positive for all that backed a approximately a GreenBox billion its for chain $XX committed cash This Symbotic’s that about ordered, by for initial and non-cancelable times a where Symbotic This and way cash Systems. the of it's protected we is Rick purchase rapidly have large harvest mentioned, in support believe funding, venture GreenBox partnership shareholders the very our are SoftBank backed schedule, means capital net for Symbotic’s are transform opportunity In will by the any billion to investment from deployment the no after and due returns efficient Symbotic joint and segment Symbotic to are contract supply that shareholders a to even of $X the allows $X.X scenario and needed

as and confident signals. venture We're excited about launch this we're of joint demand responding market the to

it, committed In GreenBox sales, addition we believe and revenues to for Symbotic’s will we returns. generate cash interest Symbotic. in flow follow expect stream that can Thus, strong GreenBox a to yield subscription strong the large business XX% recurring order systems,

We with speaking rapidly innovating our an Operator, to to our forward update the our for welcome In open conclusion, you questions. Q&A? quarter to look and we continuing customers. your now scale again on are please progress. to provide We deliver next can you business

Operator

Instructions]. [Operator

question line-up, Our first coming Andy is from Kaplowitz with the Citi.

is line Your open.

Andrew Kaplowitz

good everyone. morning Hey,

Richard B. Cohen

Good morning Andy.

Andrew Kaplowitz

you can talk what XXXX sales. into higher obviously and remain margin you as gross moving said expect you'd steady, your profit relatively FY about Tom, despite on adjusted we go forward as

from you steel So you quarter do gross inflect and least innovation think in margin bit? last quarter, I how mentioned said at diminish a you and headwinds look here more would related QX a that think be a as could I bit at tailwind, why last didn't

Tom Ernst

Andy. question, the for thanks Yeah,

us times, So when over gross track watching annual margin, we continue particularly to an basis. expect that, you're over

margin gross expanding. On be given there some that quarterly our see can expansion. a to expect variability We basis to

albeit It's of It of this flat as growing As we redundant business of we're sequentially just things the we that QX fast. partners with the factors where the we expansion XX.X%. to here costs over be where outsourcing our that time, rate redundant along of seeing our continues coming the Andy, with expansion we're the rate handful have see at same -- seeing shift costs. of where we've associated are in been particularly so to impact a

see We over abating continue those time. to

be XX-year were where last quarter see steel and we ago. four continue look continues to we've when we seen As you this the average. in benefit quarters relative a to modest to headwind do to We benefit three that modest a expect and quarter, think a relative mentioned, to

level However, and the index over a has months average. seems steel XX-year elevated at still recent actually high going the to few the relatively be up to been

there's that for longer think that to term we So over abate time. a opportunity potentially

expansion XX% X% We of recurring rate. expanding. finally, we now ago in gross rate margins are significant a at then loss And recurring year were had a versus margins loss where revenue the

on a recurring continue revenues to that north lot as we where more structural, see over XX% in term. we waterfall see margins side, term gross we However, from recurring recurring long these gain of long scale the power to business,

expect over annual we expansion. see look So again, as an to you basis, should

Andrew Kaplowitz

backlog see We maybe then on quarters. Tom where you stepped up the of your to don't for of strategy over appreciated? of outsourcing your of side, for sort is give the obviously XXXX. revenue thoughts And FY a QX, street revenues guide this the sort you want street initial growth last helpful. sure is the be does ton projecting the and -- for point of any But your at Very just see FY XXXX, support maturation would it's kind I'm nicely few guidance.

Tom Ernst

Yeah Andy. thanks,

we ramping to we're we specific forward of growth XXXX. underpinned we right, deployment basis. revenue and be guidance, are providing for have. looking to is guidance by So in going growth the next fast a quarterly But our year are sites And on you're

why your commentary seeing on we did significantly. We benefits compared that our saw a as sequential growth a up year anticipate see expect flattish as we expectations picking deployments in in our and type look we to we little QX sequential a in we QX also that So into next some our bit little that just expect well, our QX growth in really of creates exceed of do speed the question terms of QX. timing of perhaps healthy

Andrew Kaplowitz

systems quarters? follow continue little quick And six that you from would bit a Tom, to stable see because been the rise like initiated, it's last continue just up to here, few a right, over there

Tom Ernst

so some has it as of and see can kind consistent. lumpiness well been You here

surprising be sequentially. over Timing think you'll systems there, we actually depend won't down customer’s deployment run, growth on well. as see if I we readiness on we're but have have when those quarters starts where does long the it

but as see So we there expect should though. not quarter every to some quarterly variability forward, will move we growth, be

Operator

the Matt is our coming And Summerville line you. Thank with of Davidson. question from D.A. next

is line open. Your

Matt Summerville

Thanks.

out quick about some ahead last or of couple margin can headwinds what from a lies model how Just and quantification the that standpoint in restructuring parse we to quantification this? you Tom, not tangible standpoint, gross you've whether Back regard, and from a as any seen topic of kind benefit think actions the quarter the tailwinds and to a taken from of maybe kind questions. of tailwinds

Tom Ernst

in did Matt. some Yeah, thanks the benefits for question see We the quarter.

us see, a to see though, continue to time. continue that of outsourcing leaves initiatives for We lot over to opportunity our expansion

So our we're only We're benefits. major continuing to as initiatives earliest invest innovation the significantly those seeing of well. in

projects has investing in we're big margin are that So gross redundant that term finally, major rate near autonomous just think time. over us the I Rick's these major occasions, that growing brake something but our we SymBot, be of to pack on that that with we're payoffs. along at then which the has our cost And continues that of in significant think. release have platform the going innovation cost speed mentioned two a line our to multiple project, that that payoff in our bot

expansion kind over and to order of of see in opportunity coming that of we look couple those take expand. the years that's as magnitude we the You forward

Matt Summerville

billion Got it? go And with talk if you sure that what sure the formally guys correctly? Thank that drive And Tom, to respect GreenBox, little I make to you has $X Symbotic just then I want to customer guys. with you situation bit was payment a announced, GreenBox wanted potential over make the you I wondering JV inbound maybe feedback I understood, inbound to then? can heard I can would early qualitatively

Tom Ernst

Matt. Sure,

from we numerous in So interest have received GreenBox. channels

expect provide today management, been warehousing his the up Rick and service, be as First, as to to and this up it's in we customers I'll some to opportunity we've has services only his goal prepared business as demand a for able the although provide cost has just interest been been sometime last huge in and end new has expressed interest inbound week as mentioned hasn't we'll customers expressions quite and to stand remarks, to in what at and vision a time interactions this company vision and you the on hearing old, this quality much and then is received said it's week this had well, we've here get lower model. higher what customers go-to-market so in new with that business running And of we and for XXXX. announcement, our then since of about. first to remind a what bring led

So the that updated on we'll keep and you progress.

only visibility rest efficient so structured execution around in the scenarios all GreenBox, billion slots have such that incorporate also every not this as the it we question, our to including planning business as to the control On our be flow it and interaction cash about the and over growth we that of the the such at but make about $X we along base scenarios think scheduling business. we We we scenarios, purposes of capacity structured customers' growth GreenBox GreenBox. with more that with positive to have have for think aggressive

us the we requirements that where payments -- for to profits GreenBox a to are are the sizable In capital faster our first would support due commitment. for thought funding the out been that our growth recurring what of perceive thought door, that's had entire ownership that billion case, all about we we're cancel. capital that go plus if that XX% in received including order payment on would payments downside means scenarios that's extreme whatever annual case the the we of that the be have every as $X.X that that reason us have any actually So of about possible, position. scenario GreenBox that necessary And due to in

us And to so over $X billion. that nets

capital taking we the investment of are level highlight business. on and in and Just partners here our that belief wanted the to

Matt Summerville

Thanks Tom.

Tom Ernst

Thank you Matt.

Operator

next Latimore Thank you. Northland And the with Mike our Capital. question from coming of line

Your open. line is

Michael Latimore

couple you Great, quarter, think thanks. again exceeding the the think should cash Impressive trend been results of there. as that's last flow about I quarters? a guess fourth EBITDA here about we

Tom Ernst

Mike. question, the for Thanks Yes.

We cash for continue and can we have cash year, to flow flow be to -- be positive variability. the expect

can will flow the should net can spread EBITDA little is that than concentrate not case. flow our and beyond our you're to bit. our revenue bit is our revenue atomically you and guide expect just working of capital a little bit be the where describing customers Cash trend so sometimes a our recognition production per because tend cash completion lumpier be dynamic three purchase, they the I more as flow will or couple So that percentage above generally, be little the system a line. a on cash can a be invoices can But where

Michael Latimore

color you've would the their on fourth rev the And deployments number past, kind rec hitting general in that Got biggest of dynamic it. you Tom, How given that some in then, phase. quarter? of are characterize

Tom Ernst

Mike, seen the that, that past, rec here installation on and -- dynamic expensive in while we into schedule most phase part is strongest have gotten that is. the are systems deployment of physical is generation where rev complete where we've what continues as the the percent to revenue about is the those occurring a basis, the

think revenue of ones we've think XX disposed quarter. in those are in say I systems the and about past contribution you and generating our by deployment deployment, the QX what X started that here of about in the a that those are to as QX, fiscal in in systems So end number strongest fourth the were

Michael Latimore

Got you. it, thank

Tom Ernst

Thank you Mike.

Operator

next of from with Thank question DeBlase Nicole line Bank. you. the our And coming Deutsche

open. is Your line

Nicole DeBlase

morning good guys. Greetings,

Tom Ernst

Hi Nicole.

Nicole DeBlase

a little after I similar UNFI new the for focus guess, are on this what announced bit you you Just going sales a still or $XX to to earlier with customers billion, is backlog guys on now focused being that year management? less

Tom Ernst

always frankly happy first the in customers. focus words, been, Rick our has So

billion now was everything $XX that, customers. in really and $XX deploying happy is in billion So what we're it's $XX billion results sure or that making

we per addition bring In to intend in on twos by new term. near ones year or here that, do customers to the in the

brought we've on GreenBox. this And new launched year customers and two so already

So it's a pretty big us. year for

we're bit foremost, then have you above think forward, should one us a execute little customer to look see backlog first expect and or it right think incremental that sense But or focused you I I that where makes the and as two. to on two.

Nicole DeBlase

Thanks this anything SG&A Q-on-Q a it. this is And bit level then sustainable got highlight in Tom. like SG&A or ticked of quarter, guess, there? I down Okay, to

Tom Ernst

a as But we and of hiring I actually fiscal project some is a in saw offset little at see to This by downtick pretty partially that fiscal think run you forward, our there. continue do QX, being more. as we a rate little see in other we QX, variable activity look Well, bit abate basis slight expanded we have bit. a significant our

is XXX about to count head heads up Our quarter-on-quarter. people about X,XXX

we've think about thought our expansion as should you year but moderate this over of that be growth. against that's kind expect think moving revenue future framed the near-term forward, strong expectation out I that with as expansion we forward, what OPEX consistent would looking you headcount moderate

to strong operating continue we see leverage. some So

Nicole DeBlase

it pass will I Thanks, on.

Operator

question. our from you, line with of Craig-Hallum. Greg the one next next Thank for coming Palm question moment And

line open. is Your

Gregory Palm

Yeah, thanks. speed Congrats I on mentioned the the think looking terms the in quarter continued upside, progress. of I guess deployment. of back just in you

be deploying little on outperforming, are what mean what the deploying more bit more more quarter, helpful? meaning exactly a revenue within are would than capture the So be initially recognize is you or I faster, to you progress just thoughts thought, able you you're may systems

Tom Ernst

opportunity new with And business target new This launch a were, putting as is it to we're goals through to leaves a phases, system faster deployment. the still there. starting, on. slightly do under still the that each but years expecting we're marginal goes a is the time Greg, little systems What are of systems we're today needed some shave or off with we're not to here we're huge where what two able our also that started plan, we time what consistent bit seeing, we keep from

completed we to use. and begins full that the the customer get deployment ramp So production of

over to term months the over and take process that are to run, long if both and still we Our partners through six can. we cut where that look the move technology long to to time materially goals

Gregory Palm

it. Got

a And Okay. sense. That makes on then gross bit just more little margin.

you So if a on but on maintenance in see systems significantly segment bump least software saw loss at operation we it look support you pretty and sequentially, services. at a higher did based margin,

sort So gross loss view the of I'm terms curious of that in just kind forward looking by of how segment? profit you

Tom Ernst

see and if think line you the more I at non-GAAP static system actually in you'll in Greg, you'll -- -- if it a basis, look you a the see more on consistent static line. bit little more expansion -- recurring

bit a seeing GAAP results. effect on you're comp stock-based accounting the of an little difference created treatment a So of that's to

Gregory Palm

in top the of Do your by comp terms segment head, you proportion? mix the stock-based know off of or

Tom Ernst

release. in have the we think I table that the in reconciliation

Gregory Palm

I can you too. with follow up off-line,

Tom Ernst

on Yes, table the -- though. release it is the in

Gregory Palm

Okay, Thanks. sounds good.

Tom Ernst

thank Alright, you.

Operator

UBS. you. is the our from next And question of Chris line Thank coming with Snyder

open. line Your is

Christopher Snyder

starting Thank because is the the managing little multi-tenant burden that a managing plan ask I -- you. be thank pretty these for facilities, seem could GreenBox does just the with will facilities about these talk Maybe for high? be commercial these you. and bit doing this that SoftBank it JV, can you something

Richard B. Cohen

Yes.

this So Rick. is

as operators some there our today with are Symbotic, acquisition. that the being Symbotic and is frankly, SoftBank, of quite we to three on customer run systems So partner the commercial do PL developed us would customers. The with between many will of like relationship

for just So operator the who that be to it's increased traditional has management there's who be could way, develop have which -- so GreenBox so we're a a of management that to and of -- hire GreenBox partner as so team be the the it of combination a Then we be a system. customer Symbotic GreenBox have for we our think but another sell customers in and some of will operator will this now instance, would port and Symbotic. -- team it will the speak, is developing partners a could assist Symbotic

that, have the going we're to not we'll force. think and outside think to going the of commercial to But probably scale sales couple not a businesses we're We -- of There's real we relationships build buildings. existing or who have there's in have construction already which into built relationship partners the going estate be we're to business. So here. go

and well talking the over and up And it customers. seem. year, And So GreenBox. various we we it's a commercial be the on as on the Symbotic to did outside will been not sales to a have might complex focus, working that But we set a reason different for as will this have develop force SoftBank and on yes, we structure the that and be want simply kind We will force-driven run Symbotic is, not the they involved but customers. the commercial not Symbotic commercial Symbotic did systems Symbotic. keep right to from will pure systems will Symbotic a in the operator will GreenBox partners, finding to overhead. getting the buy and be want burden with as then XPL of play a sales way

Christopher Snyder

you helpful. Thank Rick. Really, really

you grow come on any presumably equity the on more steady we're that out from Will call it to contribute GreenBox? is in us, capital they as last not SoftBank, But on the Another will Thank be XX. deal, week, put you. to that Symbotic that debt capital, that original you're getting taking they -- the to form what continue the going there SoftBank. of GreenBox capital to get incremental through be will in kind are guiding to conference more more of said of need question GreenBox will outside

Tom Ernst

for Chris. Yes. Thanks that,

for that's business. profile anticipate anticipate we growth do the strong require capital, because a very GreenBox that we So will and

is -- the system. the now will is So form to it for to be the that netted in of -- capital due flow that against cash of purchase going come Symbotic

will -- but be we will cash of we funding get. I we out will capital mentioned, flow as it be funding the anticipate So we come

SoftBank growth. will the to directly support capital be in putting

Now over time, be will we bring debt anticipate able as on well. that capacity we to

that anticipate support is GreenBox capital debt the of we can own some subscription to that the positive flow its supplant begin necessary customers, costs that the ahead growth with cash growth. right, So capacity on its being of to are when own

Christopher Snyder

If I it's squeeze of one last appreciate that. one I just could another question. in, common kind

capacity could under now, I kind Where right months deployment just XX of be, the ordering can say, in? that trying from deployment. GreenBox much. guess, XX for under sense so next get year. do systems think I layer start how there's will to you Thank units think, XX now, GreenBox a growth you for or

Tom Ernst

our building to that I to scale $XX partners the outsourcing in per customers along for build as the than ensure on Chris, and support create for one to billion network have model. more supplier really whole capacity open backlog, time to to for the operations those we mentioned, existing potentially additional we us two our with just new don't that to want and we've I So we're we provide our frame, customers year but bringing on. set want and the we network business is a think goal to been our really up target supplier our to

do deepen that. capacity believe today. to do so and the to visibility harden us can And what create we we're that the chain we've date progress more do is made gives already that that looking So outsourcing beyond supply we that to that

Christopher Snyder

it. Thank you. Appreciate

Tom Ernst

Thank you.

Operator

you. Thank

from coming Baird. line Mason of question the Rob with next Our

is line open. Your

Robert Mason

This on a be morning. good the follow to Yes, may just last question.

industry, they out automation were can secure you the to the do been is the what some step in you're of those some there's you warehouse to come if am by is stronger you about insulate I which industry how partner players three deployment if guess, and resources or than two of steps resources? larger back how I today, against years back, on it market out pull on the Just that curious these your pool resources a stronger taking far also for insulate, systems thinking look

Richard B. Cohen

Yes.

Rick. is So this

a over there's spent I two and we're So lot months this things the last time of that on doing. six

said, suppliers want new continue for backlog us. you as to also down. may partners to seeing find build we their systems cut new So We're that find to continuing that greatly have,

developing we're a relationship with so And different of kind these suppliers.

we're So C&S. partnerships. what in are my past I life with is real this did -- These developing

large very and to we're to be of anything, are customer long-term sourcing we're the single lot suppliers these partnerships around are So world. and suppliers, going quite we but finding a frankly, be going to not a

feeling So pretty chains we're I think running. ability our to the keep good about supply

six the One I -- I the visibility backlog. are has community think how where kind really a five but whole of actually suppliers is, seen, that to mean, times very has there things few seen these predictable. have of or supplier is we the community year

And have. so what that's we

into suppliers. then and asking go before, faster, their So you down very the didn't systems The as higher buy the times we more and build higher install systems. about suppliers we're and excited question and quality were the more products, installation

So of in last -- very about to we're breaking, sure us. that on what very years happened happen supply focused making very, very, the of chains we're and couple doesn't aware

Robert Mason

with an into they deploy contract And a have going this think GreenBox, secure good. or to with customers forward, place you on on some respect just sounds order launch they'll about early systems pursue would or your you? before would them. customers as to would systems you it that they Very before expect like need under follow-up they But you spec would

Richard B. Cohen

spent of of did I I think I went of from prior -- spent so and be our to one that Japan and on couple of champion the create sites SoftBank Masa. times, Board one great. that do reasons -- we they're GreenBox speculative, both. The lot who's been if this that my willing mean, reasons of with with a these deal take. a was that's going risk idea. is But a this I believe great a some to that of the a should will Vikas, to I we SoftBank time we in be network returns -- has

that not but I company. automation public it's as have risk a as started taken company so that a out worth a think it's warehouse Symbotic And it should

single operators from with other that's I multi-tenants So this. them. put we're so last saying, why over they is we this is customers there We and and for million have hard talking the cases, will build mean that months. facilities because to very ship think Symbotic, under we're have might right errors could even will and then are it's that. XPL over hearing might a and we partnered and they does facility, why what million -- But for I be but will know the error, to GreenBox we for customer a don't reason XPL what build control. that the that miss-picks, is I is if didn't are X wait we keep have And we have we come. seeing now operators. X special facilities to orders there very very, and that you six will And know that it where a we in over would as inventory not hard have think we we we cases, one be demand

a perfect way accuracy, whole these XPL industry that accuracy, inventory enables and perfect creating of new shipping nearly operations. we're So whole a and new

systems, really So about And they're excited. operators excited partners are we're really, XPL some talking us and they is it really the who about. could our SoftBank excited about, buy to and of even

this -- think I is is people a a this big very don't and we understand, new market So think very, market. fully it's that

Robert Mason

appreciate good, it. Very

Operator

Jose with our coming the Thank Giordano of Cowen. you. line TD next And from question

is open. Your line

Joseph Giordano

Hey, guys. morning good

how spec extent. Just a because it's comes self-funding some couple been that out through that about its seems things this that to to coming been over of not the definitely company clients to and days can the last be Rick, GreenBox, operational kind of a works. of lot kind go us a of have in of a Maybe own from questions JV a of some way, kind does confusion couple there revenue asked. since I have of

this I but organically mechanism? of to to if still yourself stand some up like, you to what of do you had have about to accomplish you capital talk what didn't it if meant what in do is if bandwidth, through wanted terms doing, this all in route, not organically GreenBox, were maybe us do to think going go instead you confusion. would GreenBox do this organization, Symbotic want Can to terms would of at that have that's Symbotic you management you to driving were this

Richard B. Cohen

Yes.

question. So great

very, the So been outsourcing these our buildings realized long ourselves spec or the Symbotic GreenBox what where it has, have for fell that Symbotic have was I and about to and all hard thought building backlog doing or very start-up they obviously, onto with costs but confusing I investors.

it very what while that Symbotic creation a value Symbotic, to to So percentage returns offering the we GreenBox did we both is, of and still is has great pricing separated large understand out software because a margins and what getting through we big we're the to profits SoftBank. through

we own lesson took outside any a and XXX% I not get right business, which XXX%. and because wanted time capital couple that is a learned the owning if of which an would large I earlier, take have still massive acquisitions, if So we at And up but at shares. capital because give outside I didn't the capital it's just of, I done I never we -- C&S, liked the I done

it I hurt so the run. And C&S long Symbotic, really think will in that hurt

I a need but about thought infrastructure market, of capital play. -- new one GreenBox So whole things to we're early, keep also to create get we pure create to is with going the need a Symbotic the to as we

lot in we about for talked of SoftBank, was what why get SPAC. partner we We it this GreenBox, really the And license the very we but something a margins, we so it's a we early out them get invested -- is fees looked for with with very today. Symbotic first -- our SoftBank this of business than get we higher when then on. help created software healthy of And healthy did because

GreenBox to profit will come So Symbotic of our XX% back as of a the distribution.

waited And the long-term, I or to did do in lot myself, had at in taken it. would as think confusion the when it you I if good I think do going been streams, a I three but if to than of have be six more this. Symbotic. as it's years years think to it So five early lot a profitable those would it's not have profit And there add I

why that's way. now this I to it do So chose

answered hope I so your I question. And

Joseph Giordano

color. this Appreciate Because suggested confusion talk registration was response maybe great the and I the time, That's of there did maybe Yes. legacy that that what position, about worried you seem it. like same mean it share needs And at what the cash your was Can capital that people a actual were happened also there like the then maybe about liquidity Symbotic necessary? shelf the I initial primary near-term really one. given doesn't at -- last time event. registration some are issuance just and think is

Tom Ernst

This first shelf, saw you SX Joe. that our opportunity a did Yes. for to that. as registration. in question, do Thanks We was feel

governance that a actually we be to a So expanding have year. you right, month business, future subsequent are this And it you and you're any the our margin cash for that forward. good or raise. positive GreenBox enhancing place basis. anticipate have year with capital equity will that in then business we want listing We in we either shelf on and at flow And anniversary quarters been cash margins on top add your when the for GreenBox, per look before to row can looking streamlined expect and that's like public three should was that flow then that. to have And file is as process felt debt we

this general for really don't we the at business core see operational So need point. a

cash to So our as look generation. forward we

Joseph Giordano

thanks Perfect, guys.

Tom Ernst

you. Thank

Operator

And you. Delaney Sachs. with Thank question our line the Mark of, Goldman from next coming

is open. Your line

Mark Delaney

good for very And thanks taking Yes, morning. much my questions.

on development capability? how you on how is feedback and First, update could I provide an BreakPack was please hoping has that progressing been

Richard B. Cohen

Yes, sure.

product. up break a of starting progressing the work on look It's a lot from and the there. time -- whole cheaper. starting a have we basically, It's pack that of new it's time quite whole We're team track. us. system first now will all line Walmart already The business. going lot new system whole It's to like, for on new is is of There's with and learnings spending issues the well. a which better, to lot the product So I'm But been there. be second a great what would be faster a spending

happy say think out to whole very So a and very the to we're going I with it's good would to be roll for product we us BreakPack marketplace.

Tom Ernst

of do concept to add Mark, I'll feedback to with customers proof making prospects we this we'll we interest just but is I it in agree one more that, that our from product. that likely Rick, and our generally before continue And available existing the get intense expect that that add

Mark Delaney

eventually reach I that. And my helpful question not second color. believe margin. has the for to the XXs, I time. even gross over systems high the articulated was all potential That's appreciate company if on the XX% that

current sort any how detail the add relative you key Thanks. much on more level? that the gross comment of margins? margin various get So the in to rough then factors be factors could to would to could what to And of sizing

Tom Ernst

the for Thanks Yes. Mark. question,

continue to over a on blended take higher that on to emphasize pre-GreenBox So to structural have the as pre-existing which a structural as as that. we type think we see than our we margin can here to we that we coming do I'll you margins have we of that that system well recurring backlog, that think revenues, higher gross run closer the on layer a gross begin that high XXs structural about gross years basis. long XX% the gross that time, backlog over can approach margin that margin over

new that business, our on business than coming higher margins are in As new we're bringing at that. is

unchanged that's COGS that where lot we're providing through for income innovation statement SymBot. that continued things a you support some to as our factors asked margin gross power margins. The are the So as comes longer-term projects biggest about The lower such of margin line. are and flow BreakPack, really as in revenues from. and they are investing Those

nature Just delivering as product. of a the we're that

second our COGS how actually the costs of moving the with factor So outsourcing the moving portion through fast we're and flow along significant biggest innovation is just with partners.

Those costs provide costs effectively quarters those the going outsource abate are So anticipate the lift but time and to out and we redundant us internally. near in continue as with continue roll that costs startup to over significant startup shutdown we have shutdown costs help partner’s and expansion. costs redundant term,

Mark Delaney

Thank you.

Operator

our Thank question Derek from line with Fitzgerald. you. And Soderberg the of coming next Cantor

open. Your line is

Derek Soderberg

earlier my questions. wanted around some guys. taking Thanks the remarks hey to model. Yeah, outsourcing clarify I for

do guys to point how over so. with build backlog next list need that work getting left you or on out, or you for sizable fulfill supply you six very backlog, can Can the partner that your the to of to backlog or five do outsourcing that that can years where at model feel the existing partners continue that you looking to deliver list the today, today? fulfill you much have more you outsourcing outsourcing do like Just

Tom Ernst

It can, answer Derek. can. is it Short

as network we this have tested it stress have today. We

further. our as Now get and outsourcing more it hardened than contract, have that to But adequate. our expanded enter we're efficient even we is plan partners that and network GreenBox continuing we as now we're confident work to the

Derek Soderberg

it. the great? is I'm firms, of change your anything as my follow-up in about would the firms this of priority laid business one of firms, curious sort big-box this on this great. smaller And growth this size or for Rick, Got your just who then be is sort way on GreenBox, talk does maybe to and large with sort That's wins out better selling in you other for retailers strategy, of any the can Thanks. that model,

Richard B. Cohen

Sure.

that guys, with to them. second wholesalers, all, they're big-box our system first the just continuing -- UNFI we're the announced sell So of

the we of pipeline, and that type customers which in in get the sign those a when -- will So deals with pipeline. we a still of there's them. of announced have lot But lot

market in do So the frankly, for to one things that little how is. bit was the big this to of just is is going considering didn't surprised so -- years ago I and much thought XX a I automation this how know, I wanted out product one of things find that quite I demand C&S do really

Big about and even more have Box, talk continue the we projects. still existing customers to in So to we

or as supplier at a might thing. Whole be example GreenBox, -- before let The that small they're me buy of you makes online small spaghetti you Foods an sauce products that GreenBox could Mama one give that's somewhere. as something might Browns they're a buy so warehousing on and So you shipping

So a building that X could somebody XX,XXX million. case holds be that that in positions takes

a It customer. be of a be that small lot customers. small So would could

or for then wealth about, the of And the which excited one all is is them have we've talked work of as funds, SoftBank the owners hand, things and all operators. we're ports that Singapore the On ports. about why people partner, it's they the to Saudis, of one other of large so a reasons warehouses sovereign they that build whether way the them UAE basically they're very or the

be if the world, would So automated customer. you probably all the the that largest world's in ports

So big customers small and they're both customers.

So into who unloading to got would containers store that go has everybody the stuff that's somewhere. ports,

shoe big XX of to because today their have they warehouses they could they where that wise, have do so instead customers want that are much efficient these systems. somebody that we themselves. they could And might you warehouses the management warehouse like massive shoes, put freight more of companies some only can't have big massive now today do having offer that And six warehouses with

million of in we and could XXX,XXX could our store boxes X you instead around so say, And spread country. the boxes facility

we're created a I it it, great that combination themselves. whole But understood secure everybody is Iron business way going the course, a and that's a online. the everything not started, business that because it's about, business created it Mountain, which So of describe of stored nobody for storage a when anymore really talking because records concept of their

building, have more how they out. Every idea built being country, big built and other big business nobody focus never they these thing them the XX years sheds build are had So there were they any If storage building they and I that them. That they all an then build customers -- ago. small and would that extreme the storage had, customers. was is stop these all that on time around apartment

offering small So different they chain large that we're a never both supply customers flexibility customers before. whole had and

Derek Soderberg

thanks Awesome, guys.

Tom Ernst

Thank you Derek.

Operator

back Thank turn over further I'll remarks. time. no at the queue questions closing you. in I'm any for Evanson call showing this the Jeff to

Jeff Evanson

or investor today. of all to call conferences, talk at and Thank our We facility everyone, forward seeing many again quarter. Alright. again. your Goodbye. in Symbotic look on Thanks next interest when tours, we appreciate you you, we for joining

Operator

conclude our that does your for Ladies you participation. and Thank gentlemen, conference for today.

may You disconnect. now

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