ACFN - Earnings call transcript Q4 2024

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Operator

Good morning, and welcome to Acorn Energy's Fourth Quarter and Year-end 2024 Conference Call. [Operator Instructions] After some prepared remarks, we will conduct a question-and-answer session. And as a reminder, today's conference is being recorded.

Now I will turn the conference to Tracy Clifford, CFO of Acorn Energy and COO of its OmniMetrix operating subsidiary. Ms. begin. please Clifford,

Tracy Clifford

and operator, all joining for Thank thank call. today's you, you

are the remind its may its as renewal customer or statements disruptions risks of risks the economic first is related financial me future the to operating growing following executing operations rates uncertainties. be company customer high to and The technology, demand, and everyone base environment. These company questions Let as performance operating to risks that business in remarks associated and potential various answers well forward-looking. well periods maintaining in subject to the plan in or as from subject customer and as to the changes financial landscape with competitive

management's is assumptions information and the are assurance Forward-looking Private using safe provisions on There statements data company and achieve Litigation goals. of based XXXX. no available Securities of harbor the to pursuant its that will Act currently Reform beliefs

no under that made our circumstances as and may company The company to of statements to call. our full or today filed events and included in discussion affect website. legation revisions on disclose undertakes morning sec.gov that A future is available risks reflect after of risk forward-looking today's occur factors uncertainties or revise XX-K the to this and on

over Loeb, of CEO Jan Acorn call Jan? to the OmniMetrix. turn I'll Now and

Jan Loeb

fully XX% from to income in XXXX. today. our or joining per share to were am and by and we the for Thanks, proud thank $X.XX million teams the fully or increased us I $XXX,XXX OmniMetrix A all Tracy, net grow share per $X.X XXXX. in you and diluted able revenue just $X.XX Acorn diluted progress incredibly achieved of

share XXXX tax deferred income . include million diluted fee of $X.XX or benefit. results per $X.XX Our

and assets. sustained approximately This of our outlook reflects tax deferred was profitability tax the result total for our of only benefit XX%

or million deferred assets approximately allowance still tax valuation Acorn release, XX% Following remaining of in has $XX the reserves. our

XXXX operating you million by may our provider. As revenues initial know, contract of an $X leading results the from with cellphone a second were bolstered half in approximately

is backup with of shipments of at and sites States. they initial deployed services hardware the cell focused that and of monitoring customers' and ensuring substantial really across thousands the us delivery been number the the position order few this remote needs. executing XX%. contract by profile to currently project customer monitoring highest others The fulfill with for contract opportunities units support hardware could generators the progressing a on We of this of customer during the The customer tower next level customer expect with this remain year has similar monitoring remote knowing increased under of rollout additional retention well. to The plan success with to equipment the We that United quarters XXXX. of for service premium

of result monitoring monitoring renewals course, expect respective from anniversary year the after on Of to ongoing dates service the the services. this from we annual a customer as revenue first of benefit

us Importantly, us an our sheet, balance enabled to strong uplifting substantially XXXX NASDAQ XXXX. markets positioning to performance our in improve capital to the pursue

$X.X in and from of in improved a $X.X to equity $XXX,XXX. position stockholders' XXXX XXXX XXXX million increased cash million in to from Our $X.X XXXX in deficit million

an available criteria of to the listing equity NASDAQ's release Reflecting million our of in our a allowance. improved been the operating results uplifting. valuation our of $X and pursuing portion principal the impact has obstacle shareholder

investors. of next this reach institutional expanding pursue to the of liquidity visibility excited and broader step are in retail even an our to common and base We stock

drivers We should in range for industry-leading backup in these and demand generators release, and control today's detail. of a increase services. demand press we I'd few forward, monitoring a like commercial to on our touch some consumer Looking factors more see that and and of outlined

and for such severe is of increasing periods. natural disaster frequency disrupt events electricity access extended the as foremost wildfires storms, and First weather that floods can and

incidence urgency Adding being individual security, is as and the our for of increasingly support food, growth forecasted applications et commercial grid of reliable backup infrastructure, aging roles and a invest mission-critical challenged cetera. care, to as in energy-intensive cases these in electricity higher variety disruption storage to health by increasing current The electric demand nation's raises power. is to which use in well users

substantial peace regulatory and actionable tools, data, capabilities expanded mind support functions, and with control provide value solutions efficiency, benefits. Our general of compliance remote mitigation risk that backup generators

a have We medium to use play is and what of support peak response. in electric power enabling the in role generators demand grids also timing positioned Acorn called to standby

engagement, has still response time of support customer a are formalize to early become for building in response standby We It important takes to driver an base broader but the the believe relationships generators. we the and demand business. out days demand long-term from and to our of awareness potential build our the

from first aircraft, small. are received relatively though X payments they have We our

these in factors provide invest as on continue to develop Tracy solutions. as and our these development more leadership to maintain new efforts our a support research, While some to engineering moment. product will well also business in market outlook, we detail

pursuing new U.S. opportunities supporting approximately our the of network can actively are our Canada. dealers believe revenue we really themselves, generated solutions we by XXX across sell and While

is and focused commercial addition, a are that and state opportunities our identifying well our opportunities and large as like profile to large team colleges on cellular universities. customer as pursuing similar sales internal customer government industrial In

these tiered Of and for processes. enterprise course, formal procurement more much involve longer opportunities, the which cycle large sales is

industrial growth forging relationships M&A and providers are generator reach. well opportunities out strategic and with power aligned and manufacturers accretive operations to Moreover, objectives. continue work equipment also that expand process our We market other strategy to ongoing our an to at with includes complementary seek our business

long-term profitability. in we prior be well quarters, said believe growth that we positioned increasing to continues as In have and Acorn summary, for exceptionally

high achieve provide help that customers goals. environmental financial, ROI and solutions mitigation benefits risk their operational, Our

after We have and come. a for for developing years work opportunities growth the this higher to promising outlook year a

Let me now our and her Clifford, financial COO, for to Tracy Tracy? the turn operational CFO insights. review call and

Tracy Clifford

Jan. Thanks,

our also which release, filed XX-K both In morning, available we to online. addition earnings are our this

review provide before of QX a performance the year I'll highlights call Now and full open brief we operating our XXXX for financial questions. and

in increase QX . hardware a On 'XX line, the revenue. XX% in top monitoring by rose $X,XXX,XXX and driven to revenue XX% sales rise a XXX%

contract significant Our $XXX,XXX phone in contributed in hardware revenue provider the TrueGuard QX 'XX. cell with

XX% sales rise and supported grew Full in revenue. QX. XX% Excluding a in in this XXXX XX% by revenue increase monitoring still hardware X% a hardware year increased year-over-year contract, to revenue $XX,XXX,

impact XXXX. sales the revenue grew of versions XX%, product in Excluding September driven the by enhanced introduced material hardware contract, of

hardware enhanced allows independently functionality the The services. to equipment our feature operate of that monitoring

and a shipment As deferred upon rather booked result revenue are this recognized being of functionality, revenue energized. and than to hardware subsequently costs

For period, the then the the customer is to months. service material revenue revenue the when according the booked XX contract, recognized recognized Monitoring into is to are are their is deferred revenue accepted ratably hardware shift terms. until which by installed and typically over units the units the

from QX gross profit XX.X% Gross full blended $X,XXX,XXX, hardware and our 'XX XX.X% a was to gross carries in in in margin XX% while while slightly 'XX, margin reduced lower and hardware profit XX% gross in margin on increased XXXX. in gross from 'XX. 'XX to XX% revenue, in margin Gross in XX% gross to year XX% was in XX.X% in increase XXXX margin on reflecting versus in XX.X% versus monitoring hardware in which 'XX growth an monitoring. grew QX 'XX, declined Similarly, XX%

anticipate in $X,XXX,XXX fluctuate our QX Going QX revenue. 'XX rose from blended depending in we 'XX. forward, hardware margin $X.XXX gross monitoring our to and mix to expenses operating Total on of

percentage expenses from revenue, However, to declined of a XX%. XX% as operating

flat of VP increased For million as increase operating across held were consolidation elimination higher and the our organization and $X.XX sales full spend. position year, offset to base to a IT X% the our commissions the in and employee wages expenses remained

to provide on security, us available in rapid our another respond IoT our resources all in requests, IT leverage will have the expand our plans which add to our of focus tools to data and We to to outpace to department we competitors internal a to at ideas rule to continue enable high-level additional space. innovative cyber continue pace our custom customers,

for products. R&D XX% expenses XX% and consulting the higher increased reflecting engineering costs 'XX monitoring personnel and year, next-generation and QX in with developing associated

exploring continued Our line competitive at in our opportunities. are product market driving investments new strengthening redesigning aimed innovation, and position and our expanding

and on the which enhancing Generation of and our our expanding our now growth topic Power is monitoring in While focus primary our on particularly segment, XX% product business remains the existing offerings driver. our solutions, for of accounts R&D,

our has the quarter line call our engineering that X.X excited We our doing to quarter plans the the next-generation about launch May. next which our second XXXX. has are in work more in last in products years, conference for very talk this about in team We'll been culminated of of

of with During more to functionalities, quality XXXX, customers we comply call. new modernized the air their AQI user-friendly X, or enhancements regulations. our index launch features interface and OmniView we user update with significant data a help which quality introduced including This to design the

predictable is consumables solutions. Another prognostic batteries usage high-performance or data such generator from on of development failure as collection focus exhibit automated stem which area for Most and fuel, patterns.

'XX. income customers tax to compared to we or can failures $X.XX results the profitability take share in performance potential 'XX. assets, is outlook a diluted benefit QX to actions backup to proactively benefit, ongoing monitoring income for per per our in closely tax power deferred our or By and $X.XXX,XXX income trends, preventative a Acorn's tax Reflecting deferred allowance release operating net data of when 'XX QX QX resulting valuation empower $XX,XXX in to identify against available $X.XX and our $X,XXX,XXX compared these strong strong XXXX needed. ensure share required improved diluted and

to benefit contributed The deferred income valued EPS. $X.XX tax

full activities, to $XXX,XXX or in perspective, income equipment operating XXXX. From technology the received $XXX,XXX in or income exercise $X.XXX and Acorn a to million net from a $X.XX increase resulting year, from $XXX,XXX. cash the in $XX,XXX flow tax share net and compared $X.XX option $XX,XXX from benefit the impact of invested stock diluted cash $X.XX per generated For including per $X.XX share, impact, rose diluted

earlier, year our $X.XXX a of to as Our year cash $X.X from increased position as improved from receivable $X,XXX,XXX million accounts of and year-end. up XXXX, billion $XXX,XXX to

$X.X debt outstanding. As of position cash no X, with improved our March to million

your our QX on please my you May. to prepare underpenetrated comments. in that, our see updating our That attention, substantial We call I markets. and operator, our and are appreciate and operating concludes Q&A look in favorable forward for growth strong I session. enable will discipline on we proud that financial position leadership, the build to industry and sound given particularly us team, trends our investments believe of ongoing With

Operator

[Operator Chris first Tuttle question from today Instructions] Caterpillar. with The Blue comes

Chris Tuttle

And this again, great performance quarter.

that Just I when large few a to executing X,XXX wanted call range And that the that pretty it, that you is and particular that you to that The -- on you like announced determined? contract sats. -- how the going things said the number customer. clarify percentage that's be then range. what curious like units, a just I'm think, to on of XX,XXX of how broad final I against. of -- you're the is is And number opportunity

Jan Loeb

has -- the the the is. Chris, who's for And they they don't thank cell co-location themselves, on -- customer's sites at to know going what own what you is as customer question. that number well. what for sure in is location. depends I it the PO number really a total customer in the we of generator depends the sends it that your besides are -- us be tower Because our charge for mean,

and XX,XXX. going and their between So we're on on it's cell right towers at monitors cell that We've company's now, tower. generators putting own said the just this X,XXX

is I the think still in that said more we though the opportunity in of range our contract, units. that's that we our they've have double potentially today the guess. even think added my prepared But remarks just is what initial I from XX% about

have it cell on time many a to go. sure it's to depends where to focused they in they're lot where again, their like other But that. working. And want make takes of it factors, generators, not on said remote they that technician monitor they locations companies a clear generators towers, need lot of the own that especially But and have

Chris Tuttle

it. Got Okay. helpful. That's

the in in says -- press to again, you do already by Another question, year. of What the hopefully in that complete -- accelerate related the end hardware the of the pace high? it's statement of something to of there's line quarters quarters. because there's the mean shipments few to the this by few pace work hardware pretty next to release, next a accelerate

Jan Loeb

The and when said move announced we within has was initially and a little was like year, it go done us to they over that company, this signed a like with we're depends When to to endeavor they contract have it it to period. it on I would quicker. quicker, company a at quicker bit X-year this least would beyond And them to might us going that. to to order really how obviously, they want because it provide but from have us many

think the . pace the quarters, over So few that that's will next we accelerate. why

Chris Tuttle

do. they that to thought the heard there do I've of what Is -- would do telco faster originally I to than into ever driver a insight were wanting for they be? think any going don't you have anything

Jan Loeb

about minds, I phone you in would . your upset. correct? more than today, out your for can't get their area inside just if mean, I hour, Am an you went be if I I think it but cell very think

Chris Tuttle

Well, take I . your try on point. to yes, side bright look of I things, the but

Jan Loeb

Okay.

have I is is information. and mean and up the to storm going are So the monitor their and provide that working, towers. that going there's be power and the because make be to the some cell tower, they they to have -- that running. them generator their on sure just grid to provide cell with up we there's cell that towers can't going the to power running to know

it, if about relatively you it's think it's small make that running. sure a cost . to And

Chris Tuttle

service me, curious It's was being they much to some and the slow. question said, it's to so are than prioritize sense. unusual like just trying case if I last sense -- makes a it, just questions, having on back particular I'll famous are type But circle It it at it's running, you too. their Yes. if to to just customer. want -- I makes and additional outages people little they then for keep that They're for it's then in had up something other least, not. And that. ask of

In you your supply meet demand inventory times to adequate? level the do and chain, for replenish this and inventory the given are demand. cycle supply you -- of chain have levels Do to other this your hardware and feel terms your year, efficiency customer

Jan Loeb

it we in the June so. Again, We back had -- we just XXXX. this overnight believe have this contract is calls like of happened not weekly with customer.

So we understand their needs and desires.

know of X as don't don't problem. going I now, now, in And so as right see shape. any in fine But happen I right we're months. to what's of

Chris Tuttle

going which the bit I One is to I to other expect X further the growth had Okay. is you're interest, Should there hardware in the we've attach revenue this actually or the something we're -- installations huge that respect to of of relative to and -- the in of acceleration line. rate acceleration the hardware given monitoring rate business question did have there think, on hardware installing? general of little we monitoring monitoring a the see acceleration so with see beginning of

Jan Loeb

see No, monitoring. increase increase some cost just the is you in X monitoring a to that in -- should -- annual hardware Xx remember of the continued

to going you're side. that a always the going on see you're going So . to see much you're number bigger hardware monitoring the not side -- to on

Operator

from Instructions] Richard next of The Sosa comes Investor. [Operator question Private

Unknown Attendee

execution customers quarter, proposition as that to Tracy. and to be offering I'm continued see shareholders the excited see but year. not value great growth. you're continues totally met. very surprised, Great your long-term the to super happy maybe

foremost. and first So

We've perfect the really to think, see while. I you're And the been surprised of questions. the for cost a the NASDAQ waiting justified. have the seems uplisting. for you well I was very does it had time, that the be will One, I X growing, opposite, momentum,

think done -- June? I United do timing, up multiple talk there's be really sense still it didn't States. know mean, is in by can the of release, of I Or your you parties the but air the you Just because it end in in about much this

Jan Loeb

comments you continued your thank your and Richard, for not support. NASDAQ Again, first, I'm specialist. a Well,

they're intention to us see my But and can't experts what see XX. So going what make we'll by we'll certainly through, say. hoops that . I June you have but jump our gets it to -- the tell done it's

Unknown Attendee

Great. And on I'm that shareholder assuming you'll update keep we time. call the we few month. timing I approach know as in a on have

Jan Loeb

you management -- mean and accessible exactly. team. a fairly Yes, I we're know

to expect updated. kept can X So be

Unknown Attendee

then I just kind but online is that Or know corporation more And on to the not OmniMetrix? something of of in have -- uplift, thought cards? you you the that I really just with as changing before, asked name about the . that's maybe don't ever

Jan Loeb

about continue No.We've definitely think it. about it. thought And we to

that. gotten haven't I I far, cost good benefit a by have not So doing

So customers of OmniMetrix. again, shareholders the as our knows Acorn that Energy. It's of I as mean, most know us just kind

So . what a we'll happens. acquisition or have an catalyst uplifting that certainly, see changed? to be name would an And

Unknown Attendee

And beginning and things. of of then question, multiple I the doing my at kind Okay. last probably the was call,

the in Just totally about it I in in addition contract, meant what initial about that contract, to mentioned XX% telco the you am misunderstanding. $X was something XX% unsure exactly. Or the I order? million increase what was hardware. Was

Jan Loeb

add question. Tracy, why -- will Tracy? a .

Tracy Clifford

Yes.

of customer the on on had end what XX% units the from year. was over that of Richard, meant the indication So of indicate received orders we above to and an we purchase percentage the actually as the

So that...

Unknown Attendee

do to the... with nothing million $X the With

Tracy Clifford

makes Correct me to. That sense.

Unknown Attendee

might right? have . a already order assuming does than X.X% grown little in has $X -- Or skimmed it I something. bit, like I'm I like it. so notice the But did I monitoring million? XX-K or the the that larger include that could is Again,

Tracy Clifford

we indications have inclusive million yes, of The is that of to as date, Everything to the $X.X the date. indeed monitoring.

possible Jan back add they as alluded, come Now to it's us and very will more. that

We SOW open have an essentially.

indicated send the to to of original bit be indications because the uncertainty continuously. what POs as in increase from able in XX% the they're POs the was So that's we why he additional units have a opportunity received XXXX. of might already And there full placed

So we're . hopeful that there'll be more. even

Unknown Attendee

but know wants happy And with is faster. my they the makes one, you mentioned That I testing about the hardware. right -- last two, off, that sense. opinion, it and wouldn't either see customer I they're we But can product this away. call, deliver, the they're the want accelerating it are feel you just

it a could mean, I if positive. So as that there a me I'm competitors. there and correct more use a with I'm on potential and assuming positive lot be

So I'm really really, like very make other trying negative to a order, I'm find happy, this mean, excited. to seems seems able lastly, And and grew I still you find there's it it mean and ex like your all one. can't and I -- we're just customers I --

your on So kudos that wasn't again, question. and

I to and will thank go So back queue much. you the very

Operator

Greg comes with next [Operator Instructions] The question Capital. Weaver Invicta from

Unknown Analyst

Again, questions increase, Nice this This little here loop on of I'll job order on is still purchase the the quarter. back. unclear. a X

you was PO original not XX% this $X increase that the and million, said umbrella. size So of the under is

Jan Loeb

million. our originally. -- hardware units said, given as than No. first monitoring. more the hardware Tracy monitoring. year a they've The sell was XX% products, they all ordered original plus first $X we how for that million year and order includes us both new $X That's And

Unknown Analyst

the about told monitoring before was that you total. XX% the And Right. of us

be here. the XX% will just There million hardware and doing be monitoring. idiot $X of of hardware, math So would the $X million other so

order that's as should $X $X.X million, the million. So the increased million $X times there case, be XX% if

Jan Loeb

we not you products, they about we factor other the have put that to have in different Well, right. is have products. talked different have All

mobile, there sensors. a is with there's So then TGX, TG there's mobile Pro, a there's stand-alone

any kind can points full or order different of customer there's of So that mix price from us. a them

Unknown Analyst

Okay.

XX% to said the XX% So right? units, you increase there was

Jan Loeb

units correct. In

Unknown Analyst

on Go back point the that original Okay, that comment price you to your the is incremental of either way X got. top

a And tax taxes. in A million paying. question. other messes rate, a positive. part generally $X thing on congrats from by that But achieve just subtle of cash the your That's speaking, perspective, the right, flip was GAAP Obviously, nice So equity to put not your NOL. up you're way that.

So that what's Tracy, non-GAAP to apples-to-apples? maybe of could to GAAP presentation give fiscal tax type you And 'XX shows . the some you going rate? are be

Tracy Clifford

the don't disclosures. disclose that Well, on measures any we non-GAAP problematic

through of it's what So a as wouldn't -- to there over materializes X aware, sure with to be you're progress X tax projections currently of to on But largely non-GAAP. it be, year-end we assets, what at release the projected the the dependent how as XXXX to XXXX to reconciliation next relates deferred quarters. have going our future I'm the from

largely after the the DTAs existing that been opportunities might any other adjustments 'XX to remainder for this closely the the able of certainly -- to all be be releases very made. made time that have at and first release a substantiate release So June is be the forward have see quarter to post material shipments tax on are -- most since looking we looking is all of assets. other need out XX. the will what look been each how the this able other to or into to year projections, that specifically because the any very 'XX this and and -- the we've already of remainder deferred contract We'll drive under of

very we're focused on So that. .

Unknown Analyst

right, earnings Right. is you the issue I rate of you're going type and no when paying But historically, federal. state have guess to that I tax some where totally taxes now, understand concept. report only you're

EPS just cash case. the will even it smaller make from a not though that's So look the perspective,

Jan Loeb

That's correct.

Unknown Analyst

that won't I'm -- . -- earnings that folks the on text upset, is body cash or something, saying body indicators this is EPS say get for say, cash to is something some is the So our the our this in EPS?. so just or asking,

Tracy Clifford

in the carved could quarter. the obvious we I year-end for it imagine the release it earnings and will be that Well, as just out fourth

carve ongoing of it that that We will related sure portion will make the to to clear DTA we try related out. EPS what and activities, is is to operation portion . is what

Unknown Analyst

you're year-end either when not thing year but deferred a tax, any assuming taking you the a reassess way gains generally I'm . Okay.

Tracy Clifford

part that, of come Futurally, is be nature in between we'll to of based business, have But doing our shipments difficult there course, quarter. quarter-to-quarter. when and it the on the of reassess very every orders of the significant because swings can

not move year, So result as quarterly a especially we the on it's we will to fashion through if be just very react careful a major in timing. on . based

that's timing. If really it's based what we're and on seeing, just

So numbers we It's actual but might the will impact certainly, whether very careful and there's in year-end. quarterly be end it ultimately quarters to not the about. year-end, an projections year. guidance at or to you a make and to we and of doesn't the wait to just the only substantiation until at at the we they year-end period not adjustment or look allow The we will the if consider fluctuations need enough how believe

Unknown Analyst

you. Got

Okay.

could be even to as . negative opposed be tax So a a it could rate could -- be. it it

Tracy Clifford

. we always possible. certainly, it's case, not that's the mean, but I hope

Operator

private from comes question Joel investor. Skyler, Next

Joel Skyler

the very just made about others remarks potential have and NASDAQ. uplifting Tracy, I'm echo the quarter I'll excited year. that outstanding to

demand demand terms response. there? for and going start Just you when streams on Jan. question X may response from color provide what's revenue Can bit more seeing little significant on a we of And you, in

Jan Loeb

wish the I you answer. don't tell I could know. I

much even can they the everybody. program -- manage to, -- to And what's is new amount. commit this operators -- and are we how As brand-new grid for need, know themselves how don't brand this, dollar relatively how much the they a

spaces I in remarks my the prepared and think that influx. said say, So I I

there We have know it's necessity that power we and our We not software are available to peak power, a already. we it's today. And there. is because need --

are there. I small. got relatively is position we actually that checks of couple said And a Our

will will it's be something middle, we and right there our think And to foreseeable so be going of advantage to But as it we I how in be out take that's see the impact not the in positioned it. future right when numbers will we now, everybody today. this understands priced perfectly to

SPX Private Shai companies? -- Investor. for could discussed for anything and from opportunity, calibrate opportunity that, Does of Dardashti terms generator Okay. is next I in recall Thank opportunities Asha you SP-X once question size The exists I any -- And exist? please? calibrate but company outlook you -- what November still cannot this or white of with comes exists? the manufacturing the opportunity in -- this opportunity label still it certainly still the any again, opportunity the like possibility what

Joel Skyler

please the to if follow not, on I'd like commercial has, contribution XXXX with if dealer And a relationship that reseller if what a might November mentioned progressed? a retail And the -- I'm release is? X, press curious a up it eventually please? has And units also leading agreement that if happen,

Jan Loeb

they So the and generator opportunity that monitoring services our buy more equity thought dealers dealers do thought agreement equity already a The for their private buying than has monitors with from some could not to the up their get firm and was the customers. found because was that with monitoring private money us bulk, it were was a us. firm from services, panned The mainly out. difficult and in of to they terms deal dealers rolling in dealers us thereby save

put their a customers us with the group were didn't wasn't and they and of that to dealers And the private foot want to were the up down to willing this rolling deal change of "You equity private firm that Some dealerships had private and ours just because equity subsequently, do really firm. have then equity different this. competitors sold say, pat or parent to

didn't has through panned fault own. out question to -- answer simple it is our it of no not So your

Operator

Jones. question next Bill from The comes

Unknown Analyst

received for correct customer that cash for revenue deferred example, This show monitoring question was e-mailed an is still for hardware the versus received long revenue. the -- and monitoring. will current of hardware for cash from as pays is, a show deferred term, up or revenue, Could And is question private may share whereas up year, as rarely investor. you when never that a now deferred it revenue percentage entire

Jan Loeb

want on mute. Tracy, could you Tracy, take that. to be

Tracy Clifford

a has and that footnote and at could don't that the was has And it's the the Of recognized of be But small term. million $X.X 'XX. additionally, will this and $XXX so in problem. 'XX -- in was statement breakout. December XX, total know that million was that of actually hardware. in I is deferred reference, the refer recognized million. XXXX, Okay. table throughout -- ease of in And million short X.X investor million XX portion then financial of then total be revenue for will that actually $X.X monitoring with revenue, that to $X.X 'XX, deferred $X.X what our very

to will monitoring be of period. continue revenue over deferred the and Now service course, amortized

that deferred see is of to But fluctuate or to table that in XX financial that million So the in statements. will fully is XXXX. revenue revenue hardware change unlikely footnote otherwise of the table of increase amortized after whereas in continue is it $X $X.X the you

Unknown Attendee

Right.

. So sales deferred. hardware the of are new not

Tracy Clifford

Correct. .

Unknown Attendee

Right.

Okay.

recurring hardware answers gross in shared monitoring monitoring gross Can I line you hardware prior drops two, margin. fulfill calls versus about think recent margin that relative revenue. revenue to of you the the And question. and XX% to question revenue onetime than expenses gross discuss drops of revenue to or filings, the XX% number that whereas more the below margin needed

XX% XX% you drop for of monitoring for way, hardware roughly recurring before to margin line. Is and this another likely to is said expectation operating revenue. same operating incremental the Said that revenue income revenue incremental the

Jan Loeb

Okay.

we the first have margin the the profit of all expenses. below the line, of the our -- gross in So part below answer SG&A question, to

recurring our goes receiving that checks from renewal customers. building, And to also revenues well, for the monitoring that of the some the revenue. hardware And goes

side the expense revenue for on again, side. current both Engineering and monitoring the revenue, hardware we tech some hardware but tech then for on is support support, we have and IT have mainly some recurring monitoring the

to. we margin in of the So I both I've the more hardware higher the monitoring hardware the that incremental recurring below some growth of revenue that line the monitoring the gross recurring of -- before what obviously, so for are believe -- said much combination those And XX% the expenses hardware that and drops for margin have, revenue the revenue. It's sales. than the

income operating can incremental line, revenues infrastructure because the believe, So fall revenues, our I is XX% of there. to overall

I We that a incremental expenses grow have dollar to efficient an very of much add to don't team, expect sales. and

Unknown Attendee

Right.

blended is and XX% hardware between the monitoring. So correct

makes think that sense. I

Operator

Q&A Showing no e-mail. from have the session. This no I questions. concludes further further questions

turn call I'll remarks. Loeb closing for to Now back the Jan

Jan Loeb

always speak and appreciate with happy we're We investors. to support, your

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Operator

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

You disconnect. may now

Acorn Energy (ACFN) 6 Mar 252024 Q4 Earnings call transcript