TYGO - Earnings call transcript Q2 2024

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Operator

Good afternoon. Welcome to Tigo's Energy Financial Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Joining us today from Tigo are Zvi Alon, CEO; and Bill Roeschlein, CFO.

As a reminder, this call is being recorded.

to Officer. call like Roeschlein, to now Financial Chief would turn over the Bill I

Bill Roeschlein

position, products operator. demand like call, prospects, long-term you, our EBITDA matters impact our our and our business including Thank expansion financial breakeven are XXXX, markets We'd the in our expectations occurring market share, revenue their revenues impact and we'll for of that results, inventory outlook, statements for future or and flow industry, discuss inventory product expand regarding portfolio quarter in levels customer ability the to some our become reach on to competitive supply on and recovery EBITDA on breakeven, to profitable international growth our fiscal this ability including our future forward-looking. cash and expected to in our about in shipments increase penetrate remind adjusted its adjusted new and third everyone investments and our markets overall our

SEC such, annual as the including, and factors unknown those to, press to report year time XX, are ended Form the XX-K, quarter for on of the to fiscal XX-Q in XXXX, known on our time. for uncertainties, today's limited not section June our Factors and described XXXX, from discussed but Risk release risks in report December and subject may And and with we file quarterly XX, Form ended fiscal the other reports

as date made. cause These statements from expressed call. those and the forward-looking uncertainties materially when could only made on These results actual differ to risks are this of

be and include X-K. of release our an press to measures GAAP. or furnished reconciliations financial not certain non-GAAP with considered Form During our call in as we a today, in for financial accordance GAAP the superior non-GAAP substitute should performance our to measures. financial exhibit measures as prepared We The reference non-GAAP will

is at call at a will this to website everyone recording for like remind would being I be investors.tigoenergy.com. webcast made that conference Relations Finally, replay Investor available and Tigo's

I Zvi would the to over call Zvi? Tigo's CEO, like turn now to Alon.

Zvi Alon

will before our the After you, begin company, for in that, trends discuss call Thank To some more over turning market s its questions. discussion, background discuss Bill of provide for opening he call our the for quarter quarter performance our demand XXXX. recent give before Roeschlein. depth He will outlook share and well and I to as today's on outlook results closing CFO, financial third remarks the will Bill. some financial I

right, let's All begin.

you of solutions. For and our to and systems. solutions those mission global is who in in solar scale leader XXXX, storage cost is yield enhanced safety, and reduce improves that may be energy smart as a residential, operating journey, Established software our intelligent new utility to of provide Energy and Tigo hardware recognized energy commercial

Tigo, to we product lines. of installers diverse worldwide. TSX, MLPE meet range At product, Electronics, offers the needs Power designed flexibly a Level flagship The our MLPE, Module offer solutions which of primarily X

solutions, be storage storage on designed solutions flexible components modular of intuitive a and ESS, Second, to installation. line the energy GO during energy and built

Our Go EV-chargers. GO battery, GO includes GO the and inverter, ESS ATS range Go

includes for energy And EI tool monitoring Intelligence, and third platform, our prediction production AI-based our software flagship the Energy which management one, Predict+ fleet and consumption.

operational results recent demand our discuss and let's Now outlook.

this of roughly our call, market are of of XX% of our last quarter quarterly revenue we a during many during significant sequential year, surpassing first revenue in the our stabilized extended period growth and to mentioned quarter, peers report As pleased the recovery. this

XXX MLPE guidance megawatt devices, XXX shipped to DC, a about size within XXX,XXX the revenue stated and in million panel ] assuming approximately of $XX.X with QX translates conclude which We previously [ watts.

increased an EPC activity largest C&I rapid Our saw Spain, installation in in saw a technology Tigo order solar for marking highlighted business selection power for as shutdown history. large XXX-megawatt the by increased our provider an --

Once we represent installed, believe that MLPE. to project deploy this utility the will largest globally

the introduced deliver in TSX-X class to proud large are scale. at newly our with product best We

Midnite Solar as latest welcome This property empowers rapid licensee. safety Tigo's products deploy shutdown agreement innovative to also shutdown We our rapid intellectual compliance with for containing them regulations.

of and Geographically, XX.X% EMEA in sequentially grew the quarter. revenue the region XX% represents our total

and and represents During United the sales solid grew X.X% Italy quarter, Americas our in Germany, during The the revenue the quarter. XX% we growth saw of Kingdom. sequentially

solid than of Pacific our growth driven Asia in in and Brazil, the capabilities revenue for that grew increasing shutdown the During country. saw sequentially quarter, more quarter. during XXX% we region rapid The sales by regulatory XX% requirements represents

During the in the sales Philippines. Australia growth solid quarter, and we in Singapore, saw a

newest MLPE Turning that reminder, The of to key power, industrial maximum all solutions and design and provide with enabling products a designed and alternatives. offer MLPE. a satisfy our several multiyear update TSX-X, higher utility system to an higher while lower family TSX-X TSX-X represents MLPE efforts culmination overall are C&I to edge the marketplace line current needs. The the as flexibility of leading costs the to their

MLPE its to are have cost-effective since and great the safest, flexible received most last pleased and that a reception TSX-X in believe will market. to We quarter's we solution highest continue We pull most reliable, family the power rollout. report -- most

TSX-X, the of also solar Program XXXX. dedication success the of in professionalism solution, chain. Europe Loyalty of installers announcements value Tigo program the Intersolar choose vitality recent highlight residential the who for to the emphasizing the continued of we the recognize supporting Tigo members like the This of installers other all will to and unveiling addition Solar EMEA at some made, TV In have new we would including further

centralized we systems solution Within and recently Software performance of a data, product offering service critical the with introduced line, management. all our view new EI X-tiered a EI paid Professional, under offering flagship health

unlimited-seat as site dashboard management, improved prioritized status, of access performance, into all experience such model, production, management; commissioning portfolio-wide enrollment maintenance, ultimate equipment tagging, trend monitoring the features, systems scalable optimization, flat and location covering includes: company-wide and Beyond subscription simple package tracking; status, view Professional for data time-saving with time under and filtering EI health critical one-click and analysis. grouping price seat including advanced data and a

The and of tools, resolution to and data monitoring monitoring upgrade among includes module named view system-by-system available resolution, third-party free Premium. are standard historical analytics remains insight charge More level Basic monitoring now simple into and via EI EI in-platform hardware. advanced minute-level others,

installers. to pleased every more experience Glove phase announce our XXX solar for been installations premium enrolled C&I Finally, installation system Green than we customer are which of provides Tigo in have that program, for

turn Bill? Bill. like I that, would over with to to And

Bill Roeschlein

Zvi. you, Thank

$XX.X $X.X Turning the EMEA revenues XX, was in XX% quarter year was geography, second and or XXXX APAC to million for the of our for results of $XX.X ended financial quarter XX% or to $X total of now million By of revenue revenues, period. June prior or total million the revenues for from $X.X second XXXX. XX.X% the XX% million was total revenue million decreased Americas Revenue quarter.

ESS million the and from basis, of with and U.K. ago to XX.X% due GO revenue Year-over-year line second XX.X% lower EMEA million XX.X% decline sequential the period. was a to a competitive APAC $X.X region. gross sequential compared profit XXXX On in to Italy Singapore, product coming primarily XXX revenues Gross and or lower of the gross due comparable the primarily revenue QX points region and that basis, $XX.X mix. on in improved year conditions revenue Philippines amid or our product margins quarter increased market. margins in by On of Germany, quarter pricing in was the Australia compared improved the basis and to results

Total the prior M&A of was million recognized driven second year primarily by period in $XX.X expenses lease as year result in quarter operating The a prior our year-over-year back. period. $XX.X expenses were million, the from for down decrease the

expect that we $XX expenses quarter, GAAP per quarter the basis $XX.X a approximately and operating be on be non-GAAP our efforts to expenses quarter. initiated operating to cost-cutting per million normalized additional million During approximately our and

to the comparable period. million $X.X prior loss quarter totaled million second the year $X.X operating profit Operating for in of compared an

for in loss adjusted second totaled to the in prior net year million $X.X quarter GAAP of prior EBITDA to While million compared million second $XX.X of loss totaled for the period. year net the $XX.X period. quarter the loss EBITDA $XX.X million a compared Adjusted

EBITDA Primary shares adjusted expenses. profit M&A as were million reminder, outstanding represents a operating for As adjusted the transaction and compensation second depreciation, for stock-based XXXX. XX.X amortization, of quarter

period. sheet. million last million net Now $XX.X Accounts second compared balance decreased net and in million to turning in to comparable year the comparable or X% in $XX.X million quarter Inventories and by $X.X ago ago to to million compared the last $X.X the $X.X $XX.X million $X.X million $XX.X to year to the period. quarter quarter receivable million, increased

expect majority inventory, quarter, future decline we and second cash our comprised sold quarters. was the short in and In equivalents million, $X.X into totaled the of us to inventory continue vast cost generate and of of million Cash, This offset to the million long-term goods cash cash. for by to XXXX. of primarily XX, marketable $X.X by at of sequential loss was securities decline adjusted conversion June our existing EBITDA $XX.X due which

on we our As and inventory adjusted approximately $XX of on breakeven quarterly to $XX level quarterly at a basis. a million current cash $XX call, breakeven last level approximately a supply million on expect an normalized we revenue our million at to hand, million point EBITDA $XX considering point mentioned of revenue of a

Before XXXX, Zvi, I to third turn outlook the our over for to minutes provide financial I'll now our few a back call take quarter.

indicators overall we business. performance provides as Tigo believe as revenue adjusted reminder, EBITDA of for guidance a key the to well for quarterly our these metrics As be as

For of to range. in and following be XXXX, adjusted revenues the we EBITDA third the quarter expect

and third between XXXX, $XX to We ended $XX million expect XX, in revenues the range million. September quarter

for quarter. That for adjusted my turn $X.X product reflects loss inventory noncash the million over Zvi back like I'd to third call now expect variability and summary. million final $X.X potential EBITDA We reserve remarks. range and the the mix expenses to in between Zvi? and to completes

Zvi Alon

Thanks, Bill.

the a what profitability was the of fulfill industry reordering navigating market recovery. present, recovery solar discussed pace As growth. Even of prior the quarters, earlier market demand to to the within to year. return however, and now have uncertainty Customers outpace although are environment, are being in current we than and market evidence predicted believe prolonged at we still is can slower we continue in the we products the

second delay XXXX upward XXXX. profitability half early and EBITDA our the sluggish their slowly macroeconomic the environment of profitability trajectory, but we to that more expect revenue For continue into may

long-term look Longer growth the quarter. believe our in term, and business we additional coming update prospects providing firmly the in for forward

the open call please for Q&A. Operator, that, With

Operator

[Operator first Instructions] Capital Shen line of ROTH Philip Partners. Our the comes with question from

Philip Shen

same X time. balancing at So I'm calls the

I if some sorry missed So things.

if you breakeven target. On to until you with in this breakeven talked XXXX I about the path the in year? need be back the you to guide. wondering do on to might last a guys hit 'XX, QX quarter, Or of of EBITDA half your QX EBITDA able was weaker it hit you think

Bill Roeschlein

as Yes, our that, and we made EBITDA in earlier think closing compared year. remarks, of we in and note both analysts profitability XXXX. expect of breakeven mentioned of And the because be continued we us upward more sort alike revenue our the to were what his trajectory muted metrics, to projecting that pushed Phil. that early may recovery we in but

I we our so our in that to thinking prepared moment. at think And the that and remarks, reflects alluded

Philip Shen

it. Got Okay.

So early 'XX? you so is have might realistic think suggest it that and mean, that a for do option? QX risk Or would QX? is middle not I

Bill Roeschlein

how define would I That's think mean of I it. as early first half. Yes. I

Philip Shen

Got it.

Okay.

than the as I London taking was -- with longer end As so about you the bit and you Munich June at this is at wondering -- in slower if inventory is expected. think little our bit inventory, as a little the guys channel met channel to event clear. well a London of

longer expected it channel the So outlook perhaps a of like it of is both little weaker bit or it than something kind is of taking view? to altogether. or clear? function a is a Is the Or demand -- slower-than-expected inventory combination

Bill Roeschlein

just were of we I of while and be was with macroeconomic you And taking the And analyst view to to it in earlier Intersolar the London and first, industry appears the could Conference. time at what sort reports that in longer. we ROTH general the market see came muted reports I enjoyed think, thoroughly all and there. both compared our you more out it and in year, Well,

and couple it last call, a in like more last So a looks talked initially a we the improvement about calls, little prolonged function step less bit we than It function. anticipated. recovery more of looks had step

that's out laggards or So most is with we're not situation. for restocking mostly part, done the X what's driving efforts there. always current any But X the

picture participants, including recovery think affecting macro I industry demand all us. the it's and the that's

Philip Shen

the makes need? status longer Or sense. Yes. think update Are do it. not, a channel if give you you us That you much on cleared? inventory? can fully And how Got you

Bill Roeschlein

I we're seeing a few a here Like from there's think and but for mentioned, in customers. -- the laggards us, orders couple largely existing is channel and solid I there, cleared pickup

I really as on call an our that wouldn't having future performance. So that effect

beyond we're recovery, the the and we're channel stage really more talking outlook. sort of I of think demand inventory about

wouldn't I don't So a for that us point use further. think discussion as, any I it's

Philip Shen

Got Yes. it.

Sorry to Again, I'm bring again. calls. that multitasking multiple up with

Zvi. ahead, go Sorry,

Zvi Alon

No, "normal" as said, we the major down to pretty Bill say, much had inventory, fine. I depleted. quarter, mean, where it's as it's places or, you

Italy in and seen the and number increase U.K., of we fact, of you've we've growing them. like a matter seen an the highlighted orders in number Germany As market, And repeat orders. had at a Xx of Germany, our recently. specifically X month-over-month them or repeat the as Xx stated of And matter of that we a in products from just least who of fact, volume grew

So is slow general. we beyond market The are in stage. that

Philip Shen

Right.

Okay. I'll question, on. One last pass it and

trajectory of flat the the and European we European the slowness market, with WoodMac you about years. see -- think like outlook? team, general X-ish Do As for what kind their you recently, can that the -- webinar overall they being of next it relates of to a the market basically resi had talk

be countries see to flat you as while number to And specific have do still of the so because might whole could you that grow exposure have Or a the do continent that see you you you for that countries well? exposure years, think growth.

Zvi Alon

So which was quarters can Republic encouraging. actually countries. of biggest project couple our And Eastern that have give you one X you Czech But very to an in seen activity places, tell is and those I cannot we example. years, in obviously. some increase Europe just we ago, A of of an

see see are number that doing we will we we but mention that the through well that not will growing. of believe exposure, like mainstream we is down, to the specifically, within we So activities, are an exceptionally market increased even though even slowing Germany

Operator

from line of Craig-Hallum Stine Our Capital Group. with next question comes Eric the

Eric Stine

-- going it's if here cash would improvement in just assume, it So the a a so sluggish year? goal I have like assumption reach as recovery, further in QX, you maybe expect breakeven the sounds QX would if be in more on it though, is think but flow you're to decent that about little would of even that modest, we the remainder

Bill Roeschlein

We agree with that.

Eric Stine

your talked you Okay. a you've that sounds it's you like not -- And the in kind it about, also a the quarter. you're far it I little EBITDA breakeven a are bit further. costs in if hesitate sounds look, bit in like know little not in things But would a transition cut And because of mind of off. is that past, slower, did to

don't want to quarters knowing kind yet that recovery mean, you that is for of be you if how to a it. that away, the eight of ball you couple want be I balance do prepared So behind

Bill Roeschlein

there's Yes, that. takes on puts and

that, do momentum there to of you stuff do making mean you of have it relates real relates you cetera, headcount, But institutional fees, as et vendors a we et of and knowledge. decisions lose cetera, I balance to outsource discretionary difficult the and So that. and do like we rewards more and professional and course, it like will when on can are and taking you the end cost the something to risk actions as that. of doing lose services is

you clear you don't to kind to face see the the see your can to your breakeven, recovery cut spite coming you nose EBITDA get of if path and can the thing. then So

way flexible, restructuring to have we're in of So continue if mindful and that have where about proactive very that cuts to we we we've very been making and to. be will changes and doing

Eric Stine

companies well-known out Understood. lot for issues Okay. of headlines. me. for one And last Obviously, a there's been there in then

exposure about should well any you're we insulated to think that? that these or not, pretty curious, of companies Just from any

Zvi Alon

insulated. completely are We

have whatsoever. no We impact, none

no, have not happy all. potential those don't of with exposure are any But very instances. we some We at

market fact, are us. a couple using In potential changes of those for we a as

Operator

line Wainright. comes the question next of Our from Dayal H.C. Amit

Amit Dayal

were to any the there the from sales, that quarter? respect TSX-X contribution With in

Zvi Alon

and were, grow expected. we to happy they than are so And very were. There we Yes. faster yes,

Amit Dayal

any in sort any relation impact may does that Okay. into the cannibalization? is inventory, future? you of of inventory of to And you the this launch the product in have selling versus what been in there monetization the Or opportunities for what be previously market and

Zvi Alon

the all by components Storage XXX% the facing But the the be to imagination would MLPE, Solutions going in cannibalized soon. side, I the manage the to on inventory will been were other that have we battery, not So the anytime stretch had fine. inverter of is challenges, have and what and of -- batteries we The some on storage say no the itself. auxiliary But able it. be

Amit Dayal

Okay. Understood.

still a the into macro were out. factors are going anticipating we XXXX, pushed the other recovery being sort half, that are out, that that into faster that's it being pushing of the of of play second interest right, recovery et rate is like looks Or of causing at the it are the What that? in driving but pace projects also there is some level, pushed drivers any coming out? Is sort environment Just cetera?

Zvi Alon

resi all the impact, we the Europe market. there in know, in U.S. as big is and a both So in

hand, we a major are a that the in slower are pace, And seen scale fairly utility space. increase having but On C&I have they other and steady.

we many project and scale utility I project order the up in is of received just the on. ended being, MLPE. And and very we have about it's talked a single installation and a working be will for are matter As world projects product largest the of think, one large the we it a fact, Spain largest in with

that market to the product helps and has to the us. our -- helping variations segments. So between bit little is It MLPE us fact sort go agnostic from that different the of inventory market a perspective through is the an

Amit Dayal

from the Spain, order or line -- than it this like And delivery the even Understood. year over the what's Is faster that? next time that? on

Zvi Alon

year, to going it. delivered be this XXX%. all It's of all

Amit Dayal

of the Before end XXXX?

Zvi Alon

XXX%, yes.

Operator

remarks. much. his our like you the this turn concludes Alon over At I'd time, to now this Mr. closing Thank question-and-answer call back so to session. for

Zvi Alon

especially contribution as hard again, Thanks I well their customers their to I for us support. Operator? employees for as partners our continued the our and their ongoing for today. everyone, for joining investors dedicated to to want want also work. thank continued thank

Operator

Thank you Earnings for Tigo Conference joining us Second Call. XXXX today for Quarter

You may now disconnect.

Tigo Energy (TYGO) 6 Aug 242024 Q2 Earnings call transcript