SYM - Earnings call 4 2023

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Operator

Good day, and thank you for standing by. Welcome to the Symbotic Fourth Quarter and Fiscal Year 2023 Financial Results. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Jeff Evanson, Vice President of Investor Relations. Please go ahead.

Jeffrey Evanson

Hello. Quarter Results Fourth Symbotic's to XXXX Webcast. Financial Welcome of Jeff Evanson, Relations. VP Symbotic's I'm Investor

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

of In believe under discuss the resources. in are certain U.S. these management in measures financial non-GAAP during also as and in available the financial press recognized accounting Reconciliations their including call, accepted with to not which financial our measures of our principles, assist on are measures our these performance, addition, GAAP file we comparable forecasting SEC. included business and and the website generally most SEC Investor planning, this section non-GAAP is Relations We is reported measures which allocating to evaluating measures. will refers release, that non-GAAP

GAAP measures may for net of for loss, which used measures comparable measure do the provide guidance adjusted provide financial revenue comparable We to not 'XX, other not non-GAAP and we'll be including the issuers. Today, These fiscal EBITDA. by quarter to guidance first adjusted most EBITDA. is

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

Designate. Tom our Q&A. as Rick are joined Cohen, our fourth and Executive and Founder, CFO These Carol Hibbard, Financial well outlook, Officer; executives On will Successor followed our Chief results quarter Chief Symbotic's discuss Symbotic's today's XXXX call, Ernst, Chairman as by we Officer; by

take would please? you it away, Rick,

Richard Cohen

XXXX review most of everyone. our to Thank doubles. ahead. us growth year set revenue of I'd some in you past XXXX. the XXXX for year doubling revenue strong first, Good for nearly Fiscal sites year. achievements to deployment, But the our and our discuss important was our a joining doubled highlight Jeff. you, in afternoon, Thank and us results to in like a up By

grew gross Our stores gross more of and increased served number system X,XXX profit stores. doubling by nearly over Symbotic the faster, our even as than as the doubled now margins serves customer technology significantly,

a annual reporting for systems vendors system. declines the contrast growth technologies strong to Such the are and testament and is revenue annually. are cases cases growing a moving per more at to Today, billion many presents process supply we demand Symbotic to of chain of Symbotic are deploying of move in rated another million rated XXX X.X a than currently the the and capacity capacity year, additional goods

compares This cases XXX billion moved of per the annual with total over U.S. market year. addressable

to & see So clearly, for the Glazer's Spirits continued years opportunities newest our to Symbotic we Southern customer, revenue for We come. many recently growth Wine strong welcomed family. significant

alcohol. beverage complex efficiently in SKU This represents operating a with goods verticals the the challenges, manage and the the goods is foods announcement of packaged of world's and of to demonstrates while and system regulated the win Glazer's capability distributor profiles, Symbotic range another all with loading Southern largest outside and handling industry.

operations high our such on primary to ability scale the revenue our with demand is Of systems, growth. governor course, our for

Symbotic chain faster and network hardened production, we our maintain full even continued we units automated generation for in installation, agile, To Concurrently, to We've supply steadily These our outsourcing day, margins. units and now deployments, innovate our improving focus they strengthening bot and continued chain even SymBot can Xth so have rapidly in product revenue every make partners the our in and in that and more position to are running manufacturing X,XXX and development. field on innovation of end, and approaching accurate extending and operation. to invest supply heavily have and continued our we growth is efficient.

as take With can handling, dynamics navigation over generated day vehicle Symbot a that hour generation data typical transactions per terabytes previous the SymBot number system. our improved and of average is Furthermore, of as the a improved engineered well case per bot of X boosts handle by bot. to advantage

serve intelligence SymBot purpose-built efficiency an artificial reliability to our software We to and is multiplier, expect over these time. as and and realize enhancements benefits

stores our [indiscernible] next of every to BreakPack, day, while ramp BreakPack test. and technology, now from pouring first this delivering to we're learnings we prototype, The and our our is prototype into system continue

while of flow. increased all cash and this done We've delivering profitability

margins recurring now substantially, have all are of fourth and achieved cash profitable, adjusted our our consecutive we of gross revenue Our goal while our quarter on hand. improved streams EBITDA, posting positive increased

like and I'd additional All members. thank entire result possible, the work team build our to the we of team pursue hard this all and of enhance to Symbotic Symbotic for the has continue making problem-solving talents success of the to greater this been and team.

deliver our scaling to products the continue new to while profitability of customers, what Symbotic Now both the We'll be solution, year. maintain systems. delivering capability on margins to goal our achieve in plan XXXX, in through increase to our time do as to our to growth the is accelerate and customers same. scale, more for drive in revenue for and rapid recurring systems innovate the will execute focus we we introduce We'll systems invest and for turning to for That new great to expanding innovation deploy continue of to streams.

Turning to GreenBox.

been expectations, GreenBox XX% GreenBox our added is what other any But we well strong of sale, Symbotic for the as for year its other us is will with announcing same recruiting GreenBox be make. own of which for sales for anticipate and team, believe joint is has that generates be an SoftBank. that sale customer XXXX. with GreenBox leadership any important Inbound GreenBox, in is will shareholders. and we just we in GreenBox flow to profitable investment that venture interest because the continue the customer cash a This underway. first benefit Remember, we like has exceeded

Finally, senior I that, and Financial month of we of will to our before the our areas as to Officer judiciously will team. the retirement. engineering talent about continue details. and Hibbard, artificial talk in hardware Tom Chief you, Carol from over the software team as newest Tom in of But Thank role begins data would introduce Carol we Tom. Tom like member take the management next on focus grow more quarterly continue to financial will innovation and intelligence.

have executives talented would a hard ensure fortunate transition, We to between Tom overlap smooth like have thank X these work. his been to for to I and

sharing words now. a mind Carol, So would few you

Unknown Executive

to of supply the I soon. our chain Thank everyone. join What helping to to meeting to and you Tom, as look to take level you, we next efficient to to Symbotic. customers you take Symbotic are to excited Rick. over team make is building greater and Rick the forward look value his results. financial many the and through truly forward more bring agile for I us I'm amazing.

Thomas Ernst

Thank you, team. Carol. Symbotic to Welcome the

pleasure Symbotic. made amazing thus journey. to would like of journey forward the the supply to a entire team such to It proud and progress I to talented and watching and completely personally chain. begin, I'm of work absolute at honor our far I has team with the be been transform look an the Before thank part to

Turning to results. quarterly our

of system improvement. The during market pace of We acceleration was and this Our $XXX installations ago. quarter the X new operation. saw a full quarter and fourth The advanced quarter to system to deployments. X very growth year the to grew systems revenue a revenue faster new XX% system on initiated by compared starts driven up million, execution quarter a deployments strong fourth primarily

deployment. of in As the This of in in systems operational operational last end XX increase the XX we fourth last in systems progress XX and fully from the process fourth systems quarter, year. quarter progress represents and had deployments deployments an and systems and X the XX XX quarter of operational of

important at represents to over increase were progress and last year well leaves about is with quarters systems end ago very for system us deployment starts in this from in a from quarter ahead. growth our think deployment the an in and positioned more that way XXX% systems a XX slightly XX starts strong the growth progress revenue of While quarter, down revenue

ongoing a of deploy system we and in is deployment to also with deployments standardize our streamline our our processes. to platform driving partnership Time our time of efforts revenue growth, well the through important to as help shrink initiatives as and the continue

of our executing As partners network outsourcing Rick well. is mentioned,

network. We as partners we continue opportunities to [indiscernible] efficiencies gain over significant see to more add continue outsourcing and to our time

end of to and well Our that million primarily outsourcing established fourth operations restructuring location Massachusetts the autonomous our manufacturing $XX quarter, materials chose partners Wilmington, in ramping and with associated during bot so the dissolution a reserve, we inventory. are

at by fourth Our which billion of capital backlog end of is over this we will GreenBox expect installations complete, noncancelable agreement year and GreenBox's Once that we quarter from the of venture addition to August. alone includes revenue joint the of overall are per investors a our our the Remember, $XXX was led growth. $XX is recurring in GreenBox of contribute addition the by $XX.X high-margin backlog announced the of million the SoftBank GreenBox revenue commitment. billion, contracted these backed

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

us, example, The base to which reaching It before our streams In with with are all our and XXXX. as For gross with in customer our customers generating recurring second quarter announced deployments important our is is progress of this facilities Walmart more X to XX total, we quarter with considering of plan, revenue Southern first in the We of now warehouse we and recently milestone diverse. this reached note the that different progress agreement UNFI. margin. an of are deployment continues of Glazer's, recently becoming for fiscal X revenue started started customers. is positive scale, important X

model with number leverage of invested with of for the a small being that such systems deployment. in still in recurring while sites revenue number be much business shows high This also can profitable larger we the our active

continue gross to over that we over as recurring scale to expect We time, can margins XX%. the trend

slight turning improvement by a XX.X% primarily from XX.X%, quarter, up increased by profitability, XX margin along to gross gross points adjusted basis streams last in Our margin. recurring system with revenue to driven

pass-through adjusted a sequentially associated significant along gross growth system quarter with loss the on X% burden with our rate compared of a reported slower fourth as innovation that points operations. still weigh last expense results margin percentage can a adjusted X.X% profit gross margin from gross projects, increased revenue protect lower improved XX to but This These margin and gross rapidly last Our rapid associated quarter. to leverage reflect profit dollars, costs costs driven rate costs achieved Operating scaling quarter. again with by we sequentially our and was operating growth. basis EBITDA

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

So and on vendor terms. we positive increased million past the $XXX over Combined, million our working hand. of capital customer these year almost year, benefit ended $XXX with driven the by the invoicing balances

We for XXXX. the also comparison benefits in seeing provide tough we Otherwise, quarter capital XXXX. anticipate a had first to some again a XXXX working of in timing expansion

provide continuing on personally Symbotic, scale Carol business an like I our for to over innovating customers. you interest the to your again update now we're conclusion, speaking deliver first and Carol. hand our as quarter. In the to to for to you forward I'd next will guidance reins We in rapidly our quarter for with progress. our look thank to provide

Unknown Executive

Thanks, Tom.

XXXX, For million, Q&A. EBITDA margin both XX% the basis. which represents increasing and open $XX expect to your Operator, the $XXX a please revenue we fiscal between XX% points, year of revenue and over welcome percentage and million million XX year-on-year to growth of EBITDA questions. $XXX adjusted quarter $XX We million now first adjusted on of

Operator

come from D.A. Matt [Operator the from Summerville will of Instructions] Our line first Davidson. question

Matt Summerville

the behind color able of give are of wanted curious where mentioned I disclose on follow-up. to think I you're SymBot. in hour I you're of some quick talk systems? I numerical Xth to deep have bots little I handle about I'd a newer a then to basis if than the next was where higher more trying those wondering that. the innovation trying BreakPack, could you're those Rick, generation a you take to mean more per can technology, generation. if And generation number be you the transactions of do

Richard Cohen

Sure. Thanks for question. the

to to actually these use transitioned able chips actually NVIDIA this SymBot, the packages power essentially of time, to to processing what able in controlled. Xavier blind. going we relatively to So which and today, go see being therefore, they're has is eventually chips, identify has the additional be the to we're actually year, other, bots now avoidance. identify and they're in it, we bots, have past [indiscernible], process the it collision over and bots to be to each centrally be which faster, will are But able They're which on going

that's project us. for major So a

pick that box running to how right I expect happening a that's don't are actually still call thing or in means box is flap and this other to open is maybe because going rates the much the able and get those therefore, be The we transaction to up. and continually a won't of anymore, crushed up. therefore, but bots that the it term, their vision, now where AI, packages stuck popped talk and recognize ability is you they're go about rates

expect And to that working up them addition, on actually to go able of be one But we over to bot. in the next over things year, significantly. remote-control the is time, pretty the we're

today, decisions. all can So the this additional using power bots make

our But small bots will remotely bot world opens We a same process and capability in actually honey use in deck, chips, of will make on and solution over now decision some large time same individual logic, a those a and of chips world, essentially, become the that bots exactly spills in be anywhere which what items. very area instance transactions in We're picking to a say, gets drone. our the because, nobody a minibot, is on able but in the the has our the the the do same allow the of software, box run let's can't but can vision where stuck or essentially to taking BreakPack lots batch system. not similar

similar So but a mini break something deck, on deck case, a drop down a have we a [indiscernible]. put be transfer to minibot, it in minibot very what open take drives to version on and regular a able a pack,

all are acquiring doing where lots we're innovations is very So new hard. is as have the news those that well. the and good working talent we And of we're great, talent

Matt Summerville

that Appreciate like margin longer-term can profitability? about cadence potential kind what go-forward profit profit how And maybe for Carol, move you adjusted talk we gross either then Tom here of from through about for the color. looks gross the just that -- 'XX or and as you gross informs

Thomas Ernst

for Absolutely, Matt. question. the Thanks

in the see level, So we continue margin business, profit well. level the as the operating at to very but leverage strong not gross only in

continue So you progress. I and looking just should timing due improvements variability we're gross as the [indiscernible] may could you when to think particularly some that margin quarters on that what expect you you're company Individual expect line. working of should is, on make impact steady a of will the that the basis, quarters, the things to see year-on-year

kind quarter, really XX.X% profitability gross balance this just think, of we with But we very of healthy posted a [indiscernible] reflects fast. margin, move the

about, new talked be -- as that new us well along outsourcing our as Rick are These SymBot, about us. important well. you So innovations into we're is absolutely are such for working quite to aggressively to and we're for in, asked excited invest BreakPack continuing with technologies investing really network also

redundant There's significant still as up that to level a [indiscernible]. speed getting to [indiscernible] spend we're and network continue of

to an longer-term. So that mid- above you the then strong look see look XX.X% out on out over leverage and basis particularly annual we as

Operator

our And line from next come from question of Kaplowitz the Citi. Andy will

Andrew Kaplowitz

give just before. more color but the your it really you you maybe can spoken little Tom, about vertical, or really haven't Rick Glazer's, us customer, Southern into a

'XX about beyond? customers to talk Southern sort your So new X see continue on such despite one to focus as and maybe if you Glazer's you this TAM the could in and could GreenBox,

Thomas Ernst

Yes. first any to Thanks question, take Andy. on stab pass I'll the and on a Rick if then he Maybe has for comments it.

broad So those chain. right Symbotic the to case economy. pallets fundamental a fundamental concentrated the quantities the think the problem that's in solves out Andy, that getting next taking of supply problem that cases and we large and And the exists across homogeneous of

we've Albertsons Wholesale market. exists C&S distribution step first of and in that in next so problem you this But we it well, fundamentally exists kind as and customers Walmart just as Grocers verticals other liquor that know our it such And in won have our see the as several Target. clearly in we strategically and as that does -- addressed

your to so want give this those question, experience do and that from out. new new to the that we customers problem-solving getting of Andy, just technology And bringing and go to fundamental it and per win verticals or that X year those to us out one proving data in continue

So we're Southern excited about Glazer's.

systems customers, twos going or penetrating for captive build the direct to those they're strategy Our ones year's. by per is

gives market market and more to the get us really to as turbocharge and ability then move to and really well down customers out enable whole service more even the the And on broadly us that and penetrate GreenBox help TAM. attack more GreenBox rapidly efficiently

Andrew Kaplowitz

it's be And I quarters, think seasonality to with know increasing And getting the your business, pace there would has then, down deployments but the over quarterly maybe said why an expectations? rate. conservative, in really your what few been the by want about Tom, guidance sequentially own QX in the of that's has understanding versus is be beating talk versus you maybe you quarterly better 'XX? I 'XX been QX last accelerating. that revenue then some revenue

Thomas Ernst

Yes. question, Thanks for the Andy.

phase build do so. of our combination healthy our deployments, installation and things. deliver you in So here, microscope. see a improvements seasonal have business. expect to speed that's ability I should improvement that any experienced a our we've in it of seen our you XXXX What seasonality is don't the meaningful in If there's to very of seen our has spectrum to transpired We've the effects, as -- we've across in X think really particularly phase

think look and expect to systems continue we we're deliver about going faster. that as so as that forward, And to we we

However, see that that quarter. can come every speed accelerations expect We don't [indiscernible] function. we'll

we issues. not from quarters, come you capabilities, can then In just can see it but anticipate some customer can fact, and challenges from our come these own

to tornado So you or a be us or hurricane never going a down. know there's when slows flood that a

XXXX. those that's slowed that our And things not well, have have faster, here down half we so just while are of as control as the had really are particularly second half beyond that we of us other the getting in kinds

to just had in I So Symbotic we've guidance couple quarter. we row. strong should we try amounts think that very all about forward, by together. a of quarters It's setting that expect don't every you our greater numbers beating as be And a their here to of bring kind think

this bit fourth minor did out final considerations of timing little QX in some that quarter, of are QX us timing just that fiscal take maybe helped into One a effect, have as we that things well. revenue

that them I feel exceptionally some strong quarter recently. to So QX is of had we've like relative an

Andrew Kaplowitz

it, to Appreciate you, Tom. luck and Carol. Good welcome,

Operator

of the DeBlase come Our next question from Bank. Deutsche Nicole from line

Nicole DeBlase

profitability Maybe profit just revenues from now starting with the out Is is that prepared positive in turned a that remarks. have the perspective recurring that sustainable expectation that, those you here? recurring that pointed the revenue from

Richard Cohen

Thanks a margins. for it's those significant do the was sequential-wise It improvement Nicole. pretty question, think We sustainable. in

expect is basis, you but see again, you a expansion. I on trend some minor should So retrench, quarterly can the general think

revenue. this as going necessarily Symbotic are, systems as think quarter-wise comes basis that close not -- running, see pieces and expansion, are very expansion XX I meaningful I revenues how recurring of generating Nicole. perhaps out So we're we're the But on would a now yes, revenue expect more to XXXX, though, have to explain up as we The get recurring Carol we beginning some we into encouraged.

of -- have have, Meanwhile, right? in And we we we're for various my running up XX The XX we stages deploying. and total have let XX myself, invested now. systems, we correct have systems

So the total together is XX.

XX for systems, getting but invested XX. we're recurring on revenue only So

that recurring to favorable, as number the into that So recurring of we're more with scale the the I overall in systems to begin think to and paying scale as does platform. time, be more investing we move are revenue forward just ratio kind of

in do recurring begins of eventually I revenues closer guess think over I that -- remarks, mix a to run, us we So margin. and gross this the prepared my then XX% push to said and long through

Nicole DeBlase

forward then there? move anything run And like on are to rate we any it. to the That's can SG&A thoughts line, you out at Got or the or point reasonable as model clear. line you a R&D just XXXX, moving

Richard Cohen

Yes. Nicole. the very question, lines, a think in of do operating of Thanks needing We expand have to for not have strong both the investment we expense level we those. and luxury

development technology investing else We we feel are and continue to automation. more supply in research anybody than chain like in

have. certainly need of SG&A Not extensively there to but has is our think that while some our we spend. SG&A what [indiscernible] as invest that, our competition are scale of SG&A in pointed at whereas line, only product maintaining they we that just innovation, R&D redundant other there that new with to will heavily parts our parts grow, are Similarly, our are

in don't of expand feel need we're where luxury So we those. we to a standpoint

both However, of our continue And modestly given opportunity, scale expand that to our to we expect should revenue stronger looking as forward what growth. in will that be be market operations. we contrast much Symbotic to lines expect those you will

the implicit that's we business. the in leverage see high So operating

Operator

Soderberg Cantor will Fitzgerald. line question next from from of the Our come Derek

Derek Soderberg

you that talk sort areas a process really time could are the think bit project I finding maybe where this takes Can ongoing deployment speed speed basis, lines. seeing about and you're where average how long up an of deployment -- on little quantify you you you're along can ways point? the guys maybe So at up if to just the you finding

Thomas Ernst

ramping up to expect project so and the be around a acceptance terms or X and customer full start starting, the over run. the Maybe took a of want were of first do And quantification. we we about in became that talk we and systems usage. when talked you the years long things turned start until actually it to company began public it some we launch we about can Rick, we with of from that see we Derek, I'll do those

Those systems years. live north went X.X actually were of that actually first

is these frame going that we're now on experiencing we're where hitting to XX months. now, that [indiscernible] we're what systems hit so effectively we And though be expect the out systems to and that on rolling X-year under time

in the carving meaningful and out meaningfully the that over or carve what to run over see opportunities progress not can a there's partnership long we're innovations continue long we standpoint So only is days or process from we're that weeks that But can run carving a seeing technology but out. occasional from standpoint insertion do we into that.

So -- total we that XX things to the long, that under goal over talk run. do. look to it to drive want try long audacious we our to to under X some months But about is of you deployment the can get time long Rick, months

Richard Cohen

Yes.

I able mean, as things starting doing and to and the things continuously increased, we're some happened. of we're we has our as have that X volume So that produce instead -- of that is stopping and so

into where at factory built. being an getting building better. the products the suppliers quality auditing are they're We're Our

that and on -- And sites. installation manufacturing inspection so we're of thing that And us. for other up able just building powerful the the reduces And to amount continuous is so flow that's building process thing for very site. in time just we're that the of we're now not of a specific

So backlog. we have good pretty a

is. as visibility to it have where We good

sequence much we everything build to before. but accurately not starting than a when more we we're so can And so at that we ahead a deploy enough lot ahead, site, could it ahead,

are is, talked post-COVID thing it sure just lot now our still much we're at better that's and protect the people we getting about it's and But have And supply little happened, more of chain our a a just about getting that we the making and stable. We're we're better -- proactive are chains very we're and manufacturing. at much multiple supply it, -- have getting suppliers sources. other

Derek Soderberg

think just do sort the really Well, or before the systems expanding expanding of to base? as you is help many to deploy that with that how of But plan detail. network supply of I your the Can initiative, would that XX you it capacity slowly basis. keep at sounds to a relates it. today follow-up, supplier And that then outsourcing an quantify be concurrently the get like helpful. augmenting ongoing you're you can on mean as sort it you can appreciate base? or XX us current today, that Got sort

Richard Cohen

So years our solved growth for network X before Derek, feel in we we've for today, our expanding X existing the terms of to of our that network. we coming capacity continue already

So what longer-term network we're data today. just healthy a is actually innovation our doing we growth that the even of solving level flow and to have in for competition that creating and increase and

Operator

line Palm Our next of question comes from Greg the Craig-Hallum. from

Greg Palm

again and congrats Tom, on the aboard. retirement, Carol, welcome

Thomas Ernst

Thank you, Greg.

Greg Palm

guess our a up big slightly Were in was really revenue jump. a based better jump maybe absorption there the I'll a it I just could but been maybe quarter-over-quarter, cost headwinds thought good in up, any a it's pretty based lumpy little that even and maybe QX better. guess, thing though [indiscernible] math, it have standpoint? you I so saw bit I little Systems know goes on what on from I to revenues. results over I I bit relative could one choose just gross thinking margin, mentioned think been have time, you mean

Richard Cohen

a ripe cost our Yes. of the Actually, to very more Greg, we much delivery efficient systems. and see opportunity be in

don't asking costs, about. customers the Some customers bear are costs that and of our ones and bear many you're these of our those the

out the innovation redundant exactly of of to gross your a question, margin we have company, much have but and as lot as focused so as made have, why our time very as conscious and to clearly, wasteful And the we've inefficient we we in on an here team spend the point do as are field at this we at the put executive we line? fast as grow costs choice

fast, know that we're And effort as a the we is intense of a our but team. so moving cost because focus

And flow line that into to And there are tangible in improve we kind leadership our right inventory our so and margin think of a begun sure gross we things some examples, just team, you what as to give clear on the as is time. plan we've that highly order have deal are do very your we these do I process think inefficient flowing with that some partners network over can how of make and do that way. to just with and

can you those of $XX charge our we'd restructure took [indiscernible]. manufacturing example, a operations terminate example As inventory, be for as to and we operations, -- is dissolution of chose just see, we million materials the restructuring one we

That's network, continue flow redundant site include, have supplier line. That dozen in actually -- with as gross think on begin a [indiscernible] I'm affect get as and materials continue not to to giving leaner a more can teams doesn't can the to examples be we our one manner. of that are site. we margin deeper that couple this team. a we to example We procuring as that a get inefficiency. of but just teams really the of examples on materials only those cost-efficient we process Other focus

Greg Palm

ago. this and color. X-plus X based to a months on I I be a on year deployment, think, Yes. know little added a or more year like time impressive, XX Appreciate That to makes well the I one exceeded last bit to to I success clear ramping the has, more there? X.X year, overall Is it's relative than that the maybe you last, trying years And been outsourcing are to GreenBox think, XX, conservative you've more just of think been that adding it's some adding it the you a just still the could one talking so. up in know, over be X don't about or maybe customers of sense. year, the you've strategy expectations

Richard Cohen

Greg, new customers with more and do have And are our of comfortable deployments fact than Well, -- added over up in year-on-year. the the we systems XXX% deployment customers. number are that we've X and now with we

forward. of still we right eventually With is as per in near to one addition that forget GreenBox, GreenBox year the we the us we one feel will rate for the move many customer customers continue adding be the is many, term customers. anticipate Don't like X to

we is do is year. right what that do which expand more us or do of direct the the X us now, we number far for per right exactly efficiently. vehicle a We vehicle how that's by customers for just suggesting, for And onboard. to for looking number think a you're But can customers, one GreenBox

Greg Palm

luck. enough. Fair again. of Okay. Congrats, Best

Operator

comes question TD from of the Giordano Joe from Cowen. next Our line

Joseph Giordano

Tom, guidance, just have when on you like systems question a now you give Yes, deployment. and right? XXX% more So project

nature ago? are in because inherently you more have challenging layer these like how guidance all completion a is XX these of XX opposed many now layers Given and adding more every to you to and new the percentage of have as of quarter, give year a so just

Thomas Ernst

that don't it's basis, that the of some more XX means I means surprise negative now get little project inherently right, or less think difficult. bit you a that a deployment and in generating revenue positive anything, have average a little having fact and XXX% Joe. say, variability systems in of either of If we than an the one bit

fast a milestones of revenue. as as can is be challenge meaningful meaningful movement when the a quarter can day X be in at is growing we amount you're key and when of or what end are, a But

But fundamentally, variability it's not anything, we no. marginally decreasing, and no, is visibility So improving. don't that if I think the have

Joseph Giordano

from start GreenBox, obviously, of [indiscernible]? in and them then of needs of customers you to structure strategy I'm management And place this you curious down sure for on enough. kind But revenue from just you standpoint, I'm standpoint, a road, guys at able went be producing kind as what as GreenBox -- [indiscernible] to for standpoint you to kind Fair getting be there.

Richard Cohen

Yes.

I'll Rick. that. is this So take

So really and on when pattern year, which we a it's availability focused say and go that suppliers what and which is through was went would just there's last through a bidding I scaling -- -- reliability. I so

that spending So GreenBox. was time a right about last customers year. I'm with potential now, lot of customers

there's surprising just you. are customers getting so potential to would big smaller right different there And some for the some be some lots very be ones, there be will ones there of will -- that GreenBox, ones,

in and bring of in And But a out lot the but hired time figure consulting also spending lot so together. consultants some a want have brought little kind of mix we We spent I'm that's management of a in as we and some we're we're team, traveling. probably I interviewing so And interviewing out at. people. bit anybody we're stage time to yet, -- of what different from and haven't work we SoftBank more, find the

time have you built And well to have we're some pretty we XXXX. because remember, out for

So with GreenBox. different what what you we're have typical a than why characteristics is might core of customer, may really and Symbotic, talking about picking who that's we're did couple doing we a picking see Symbotic which a couple, customers exactly is with

we'll put Sometime network. this in dig, to then okay, going and build, we're is to XXXX, going out we'll we're say, and will what where is this [indiscernible] build that

Joseph Giordano

would in GreenBox of some want of that your will in-house systems like to also it customers sort from diversify and kind shock kind GreenBox -- mix the of their some Symbotic Rick, when owning ramps of of future, base? up, you renting if

Richard Cohen

that's happen. very to think We Yes. likely

that of than much is our of Symbotic things the providing tenants One automation -- we're more automation there. so out one the basic advanced other with is

pipeline innovation would some our the customers continuing change And of so that supply help of actually grow, our is some to we suppliers supply chains. have large their to

might And and maybe customer. may that afford so a GreenBox large might Symbotic that customer be and that small system a small be a go customers building into XX building feed can't very there a

lot help And the to Symbotic, automation into a be become, so to size people we move -- the the can I the order have change in space. chain that supply think, to of

now, that very things right the selling we're large to of one systems. you're going so is And find

in and warehouse expand lot be be GreenBox, We are in that through to that's of could our think, going center. TAM. systems, small the I it actually sell And at manufacturing be could it going a a and could both consolidation really future, a to

Operator

line of Ken next question the Capital from comes Our Newman KeyBanc Markets. from

Kenneth Newman

the fixed take do Just And Tom, that see facility going you forward? the it cost cost quarter. the just just further? circle any -- other on even cost sense out where wanted [indiscernible] -- to how much leverage manufacturing deployment closing on bot absorption back to of fixed to of faster this opportunities maybe

Thomas Ernst

question, Yes. Ken. Thanks for the

So we outsourced That we initiative. margins the manufacture number costs, of was through outsourcing that the reason lower systems. greater isn't expanded expanded all fixed drive we overall It produce primary ultimately our this ability that really to think of margin, see we to overall gross systems. do the see

in a of network. do in the we it, over are getting highly our -- term, ago, we the So outsourcing year a level near we Recall, accelerate has chose step our encouraged did we been costs. we investment with the we're and to on to what our in over long backwards since going much feel more see a margins we But run. actually bit we're that, experience that took strongly actually greater

here it's move term, near done. from about we've the speed the in for outsourcing, and we expanding to where see And expect actually we effectively paying forward which as So margins. is

margin, So overall yet, profit enough costs I would say we're seen we've is the but lower lower for seeing partners far. pay our the margins and to cost so expanding

Kenneth Newman

Or seem asking get by customers delay even obviously, just doesn't customers And some to sense this earnings season. question environment just drives about and then that are like accelerate being decelerate or more Understood. little maybe their higher [indiscernible] this do cautiously bit a through all, have Obviously, of for whether have clarify further? out there, but it my any sense weakness you that deployments? automation customers to just plans follow-up. to the your talked the consumer on at impacted you're

Richard Cohen

Yes.

to the faster. -- I lowering headwinds think costs. that's slowdown. coming Symbotic, anything, have ultimately that -- to their what see seeing go as of we and want have we're is want If want market we're any seeing spaces, customers. they I what -- to fast they think And we in as and to at They They're winning be customers they forefront great think they now so not I the go right want can. with people

Thomas Ernst

to interest add I'll to GreenBox, of wake the With us that. has picked following inbound up. the

our ago. entry bigger funnel So quarter it was than of early the a sales was

Kenneth Newman

in correctly, I mentioned that Maybe I a just just flow. Tom, be one working still Yes. could if going free to on use cash remember this in, if squeeze capital just is expecting more you just -- any structurally year, margin should get whether with sense XXXX through be it the margins on better better in than was year sense to any XXXX? free cash flow the

Thomas Ernst

a flow contributor comment So our capital expanding of positive little positive otherwise, cash to timing gave fiscal working some us XXXX we And that working XXXX. But -- did XXXX in as well. QX. from for events I capital a we do tough that in bit had cash a make actually for working all a flow expanding expect was comp of

Operator

comes question Delaney from next of line Our Goldman from the Mark Sachs.

Mark Delaney

on and my add me Carol. congratulations question Tom quick margins. both Let A to systems

SymBot terms or how in-house. can in expansion? margin that should better take ending production And of long you help You us be much about may spoke Maybe to see savings how it that? understand

XXs longer how the much term systems reductions maybe getting how longer gross much what through might and systems, is bit little And or maybe margins flowing you backlog you level and then even about think today? type in into high priced XX% within for talk I is the announced a term higher levers. much And be the around like mean the how cost more volume?

Thomas Ernst

Certainly, both the Mark, question. over those we long run. the are for drivers. Thanks Yes. look

out it and SymBot proof concept for to our significant was getting almost date of first in terms actuals year in of tested. in getting us So through a experience units now and the was investment fiscal of XXXX X,XXX these [indiscernible] prototype

investment prior So a there's net actuals. to their relative in generation the been

Mark, It's a This way X really anticipate not drivers. primary from kind is forward, forward. going seeing comes something as something we deliver as it that that next we in of changes units that stepwise look we leverage leverage but is do the

drives scale of And and better of partners kind which those it's change brings gets then the down cost out field, drives outsourcing units engineering up it's performance. in release the manufacturing the with final which margin. First,

over coming consistently plan the And over several so anticipate quarters, as that's out to we kind improve time. that of going those we --

Mark Delaney

and But of some but the helpful. perhaps who And [indiscernible] systems, of think to they'd is customer new perhaps what do them customers you? we about put customer when think or other get trying we some may wondering any Albertsons, current a the we course, customers you with my what Target, additional with expand place take customers, that it other maybe in-house was GreenBox that's just those opportunity specific to do customers of for of some plans. of just the in? some might and second other for for when think take you're into backlog That's expand And is and to of Okay. of those might customers have see Walmart it backlog the some GreenBox, some when bookings want these the [indiscernible] to bookings question key something thinking other about but and

Richard Cohen

Yes.

So I'll take that.

Rick. is this So

-- a regulated. would announced them, and is Vegas so Las Glazer's, But for think space been first I Southern be a big they that it's is site. site but good it's with So example our

it's so by And state state.

they expect have reliable. smaller So they may want end less parts systems, of have more we in up smaller more to difficult be actually But smaller systems customers, if and of wanting systems in easier number surprisingly, are think the all a some you And other they our to they're sense I of to them, places. build.

remotely. ability been the about, the very we've so run artificial the working the a was And very, what talking that's intelligence, site reliability, to hard, chipsets, new I

the we're similar opportunity put to out save So [indiscernible] if people now, we're with instance, money. any for in put discussions the I capital now, those capital, having I a I people, GreenBox out want having think don't don't with don't discussions but I

system those money and participate attacking same all all the and it's rather play, But or are at factors so time. because I'll GreenBox them save that's do least of we're I'd a one-size-fits-all. in So of small at not --

Thomas Ernst

to Mark. I'll just add that,

those, we're deployments The a strong them have we with So at of a time. customers majority system X [indiscernible]. giving

that move a as backlog. I amount not forward, we think so add have of strategy customers is large the to And

giving [indiscernible]. the kind see customers mix probably we're have more of You'll where we now of

Operator

Our from next Needham. Ricchiuti the line comes Jim of question from

James Ricchiuti

this play about different When in role, much to any, you systems, of of deployments? talk begin think about does you types smaller a as how if BreakPack

Richard Cohen

Yes.

we tremendous customers We've X So learned well, still very It's have point a few BreakPack innovation that this working prototype. there's and have is a amount, very something and we've BreakPack about. actually BreakPack a it's site. seen it's but will lot the talked of at the operation, that on

us let lot of have are saying, a customers it's ready, We know. when that please

James Ricchiuti

don't will just a you -- offer the customers we necessarily should smaller to traditional have pursue system smaller key a be as deployments? about able that see be But you down deployment? you go think scaled element forward and Or -- this this for

Richard Cohen

Yes.

but So answer is your the question -- to both.

we BreakPack supports So could small system in a could that system. a sell -- so you

is the So more main is their somebody fast-moving items. let's has system, say a slower-moving they or have items and system for But retailer, still But smaller selection then our a storage provides solution. sortation smaller good quantities solution. with [indiscernible] be would that a somebody shipping small to shipping in that drug put regular system convenience, or BreakPack combined instance, or they a and very a could

James Ricchiuti

was it. to of that level into drove Got QX upside the out of revenues came fiscal And final mentioned that I there some question. heard modest of that revenue. potentially QX you some thought I

wonder quantify I if So you can it.

Richard Cohen

right. right. That's That's

a level. So modest

that, mid-single percent. So it want to about think quantify digit but I don't

Operator

question Baird. today will from of from And last for our line Rob the come Mason

Robert Mason

your a had just about I starts. system question

new in year-to-year? kind starts add high new So to about Is double if up XX, so digits figures roughly in go-forward were This XX. that low of year, of how system system stack roughly we basis stepped about I that a correct, Is XX. terms to on digits? able XX, XXXX, they're single think have starts trajectory or should my you're the

Richard Cohen

company think Rob, the about we quantify culture we it looking forward. I day here is But don't happy we way customers. for the and [indiscernible] say every think [indiscernible] it that

that after ensure [indiscernible] fast And as is want then So first as goal done. our customer when foremost, they're grow just is can. the that the [indiscernible] we and to we

want So as us to can. we as move fast our customers

XX want goals people each the more we're other. about of going X and really have we We of that think add terms become balance it about in We a customers think against don't to so to those year.

Robert Mason

see. I helpful. see. I That's

around question Southern a as well. Glazer's Just

a BreakPack customer in that that terms BreakPack, as BreakPack? run? way lot the opportunity there of but as that just assumed opportunity mix of I'm Is curious, with is a case well You for me of mentioned an operations strikes just their

Richard Cohen

lots of for applicable is technology the think customers. I different

would it. be applicable it's But So different why things look different yes, to we have might to of It lots I slightly customers. do. that's at

Robert Mason

quick. notice real the regions. I at some that question, point period last added Just did for during VP a international senior the was there new

in and about of would in seeking any how it respect commentary Just customers? you're customers first there international or thinking curious, I'm pursuing new with existing likely expansion, terms more be that

Richard Cohen

leader is that [indiscernible] about global are when targeted plans as GreenBox distribution at the talked expect we good that captive a it the say well. we operating see help a we so potentially with our markets, a European, attractive -- Europe. can also the of about with opportunity more we having We begin we a that in global do did of the network. thinking customers Well, to being one And a announced reach business what felt point how that time GreenBox us connection was

Robert Mason

Makes Congrats, sense. sense. Tom, Makes and welcome, Carol.

Operator

questions That's would all now any Jeff time for back the I we turn remarks. to have like for it today. Evanson for closing to

Jeffrey Evanson

and we you, Thank and joining call Symbotic many when Victor, look investor we you, you, of quarter. on We or seeing next goodbye. everyone, conferences, at tours for our appreciate and tonight. you thank interest talk in again forward facility Thank to your

Operator

for you today's participation does Thank conference. your This conclude program. the in

You may now day. disconnect. Everyone, have a great

Symbotic (SYM) 20 Nov 232023 Q4 Earnings call transcript