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22-05-2025
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Q1 2026 Domo Inc Earnings Call
Peter Lowry; Vice President, Investor Relations; Domo Inc Joshua James; Chief Executive Officer; Domo Inc Tod Crane; Chief Financial Officer; Domo Inc RJ Tracy; Chief Revenue Officer; Domo Inc Yi Fu Lee; Analyst; Cantor Fitzgerald & Co., Inc. Jared Jungjohann; Analyst; TD Cowen Eric Martinuzzi; Analyst; Lake Street Capital Markets, LLC Operator Greetings and welcome to the Domo Q1 fiscal year 2026 earnings call.(Operator Instructions) As a reminder, this conference is being is now my pleasure to introduce your host, Peter Lowry, Vice President of Investor Relations. Thank you. Peter, you may begin. Peter Lowry Good the call today, we're joined by Josh James, our Founder and CEO; and Tod Crane, our Chief Financial Officer.I'll lead off with our Safe Harbor Statement. And then, on to the press release was issued after the market closed and is available on the Investor Relations section of our note this call contains forward-looking statements about our business, as defined under Federal Securities Laws. These statements involve risks, uncertainties, and assumptions, including, but not limited to, statements and projections about our future financial performance, growth prospects, cash position, sales efforts, technology developments, new business opportunities, transactions and initiatives, the potential impact of artificial intelligence, and other macroeconomic factors on our a detailed discussion of these risks and uncertainties, please refer to our public filings, including today's press release; our most recent annual report on Form 10-K; and quarterly report on Form 10-Q -- all available on the SEC website. These documents list important risk factors that could cause our actual results to differ, materially, from our forward-looking will also discuss non-GAAP financial measures during the call, which we use as supplemental indicators of Doma's performance. Other than revenue, unless otherwise stated, we will be discussing our results of operations on a non-GAAP measures should be viewed as complements to, not substitutes for, our GAAP results. Please see the reconciliation of our non-GAAP results to the most directly comparable GAAP measure on our Investor Relations website, at that, I'll turn it over to Josh. Josh? Joshua James Thank you, Pete. Hello, everyone. Thanks for joining us on the call, today.I am pleased to report that, in Q1, we demonstrated substantial operating leverage in the business, showing that our model is truly again, we exceeded guidance on billings, revenue, and non-GAAP EPS; and generated positive adjusted free cash flow. Notably, this marks the first time we've achieved a positive operating margin in a saw a significant increase in pipeline activity generated by our ecosystem, a dramatic increase in our sales efficiency, a substantial lengthening of our contracts, and an acceleration in RPO growth -- all reflecting the durable, trusted relationships we have with our a direct result of this momentum and due to continued strength in the business, we are raising our full-year guidance. Tod will have more to say about that, are confident that we have finally achieved a business model that will provide continued operating leverage for years to you'll recall, a few years ago, we identified cracks forming in our business and knew we needed to institute changes to our model. We rapidly converted our business to consumption-based pricing and reconfigured our technology and go-to-market motion to become very substantial changes our team has made, over the last few years, have led to measurably improved performance, with the following metrics highlighting that the new model is working:Subscription Remaining Performance Obligations', or RPO, growth accelerated to 24% year over year. Subscription Total Contract Value, or TCV, was up 69% year over Subscription RPO was up 61% year over year. Net retention was up sequentially for the third consecutive quarter and ARR was also up productivity was up over 60% year over year and up for the third consecutive quarter. Gross retention improved to 86%, from 85% last of these metrics support my belief that we are taking the right steps to return to sustainable long-term profitable growth and give me confidence in our Q2 and FY26 outlook for billings growth in RPO is a direct result of our unwavering commitment to our customers' success. By prioritizing their needs and building trusted collaborative relationships, we consistently deliver meaningful outcomes that lead to higher customer-first approach has led to longer-term contractual commitments, underscoring the trust our clients place in Domo as their strategic partner. The loyalty and confidence of our customers not only drive RPO growth but also strengthen retention, a strong proof point that the model is salesforce productivity increased over 60% in Q1. And, although we won't update this metric every quarter, I wanted to share it because it further reinforces my confidence in our ability to grow efficiently. This metric highlights the success of the improved in Q1. And we see ample opportunity for continued retention for consumption customers, in Q1, was significantly higher than for seat-based customers. Consumption customers now represent over 70% of our ARR, heading toward 90% by the end of the year. And as our renewal base increasingly shifts to consumption, we expect it to be another tailwind to positive retention consumption engine is an integral component that drives the success of this the past several quarters, we have made significant progress in transitioning from cash burn to achieving free cash flow positivity and expanding our operating we look ahead, we expect to exit this year at 5% billings growth and 5% operating margin. And we anticipate exiting FY27 at 10% billings growth and 10% operating achievements demonstrate not only our strengthening fundamentals but, also, substantial progress on our Rule of 40 profile. This shows that our model is working and positions us for sustained profitable growth, going held our annual user conference, Domopalooza, earlier this year. And I'm consistently inspired by the powerful ways Domo is driving transformation and delivering meaningful impact for our heard from a global technology and services firm, which highlighted the remarkable journey toward transformative data integration. Over just the past year, they have rapidly expanded their data capabilities by transitioning from fragmented legacy systems to a cohesive AI-enhanced platform, powered by Domo. This transformation has significantly boosted decision-making abilities for over 100,000 people across the CEO of Filevine, a leading legal technology platform, highlighted the transformative impact of AI on the legal industry, emphasizing the company's innovative strides, with products like Chat with Your Case, which efficiently manages vast amounts of structured and unstructured legal data to allow its customers to effectively manage their cases, at enhances its customers' operations with an analytics offering powered by Domo Everywhere. The CEO mentioned that Filevine's impressive retention rate of over 95% climbs to nearly 100%, when Domo is integrated, showcasing Domo's vital role in optimizing data-driven decision Domopalooza, we also outlined our strategic priorities for FY26, including driving adoption, innovating with AI across the platform; continuing to focus customer relationships and multi-year contracts; and developing our ecosystem of partners.I've already discussed the incredible impact that multi-year contracts are having on our business, which is evidenced by the growth we're seeing in metrics like RPO and the corresponding impacts on retention.I'd, now, like to give a brief update on each of the other three areas of it relates to adoption, the demand for our advanced product capabilities is greater than ever. We continue to accelerate customer adoption by focusing on AI agent deployment, governance best practices, workflow automation, and data pipeline optimization, which are driving deeper engagement and increasing the overall impact Domo has on our ongoing initiatives, including strategic consulting packages and extensive AI academy webinar series, and expanded technical enablement are empowering customers and partners to build sophisticated AI-driven solutions, while reinforcing governance and security are seeing a notable difference in the usage of our products by customers who are actively engaged with our technical teams. And we are actively working to provide more of that support across our customer the AI front, we launched Agent Catalyst at Domopalooza, which leverages our existing ETL data governance, security, and workflow capabilities to allow our customers to rapidly innovate with AI customers are AI-curious and have a sense of urgency about adopting AI. But they struggle with how to drive real business are leaning in to show how Domo is an ideal solution to capitalize on the promise of AI. In fact, in one of the general sessions at Domopalooza, we offered to build a free agentic AI solution for attendees and, unbelievably, over 200 customers signed up on the first day. It's amazing to see what some of those customers have been able to accomplish, so quickly, with Agent fact, just today, we hosted an Agentic AI Innovation Summit for data, AI, and tech leaders, focused on advancing intelligent AI agents that automate workflows and decision making, featuring expert speakers from Google, AWS, Domo, and more. With over 6,000 people registering, the event was a key gathering to explore how agentic AI is reshaping the future of the rapid success and the rapidly building momentum, we've already seen customers build agents that do the following: accelerate the ability to spot, classify, and take action, based on anomalies at solar farms; reduce dropout rates in schools by working with students that are at risk of not graduating; streamlining their charitable operations by making it easier to capture and process tax Information; optimize the performance of hotel locations by providing better summarizations and indicators on ways to improve, redefining the future of their business with AI efficiencies related to data, inventory, tax equipment, and sales also heard from leading data and AI consultants who showcased that they were able to use Agent Catalyst to build powerful agents in less than two a leading Snowflake Systems Integrator, showcased Agent Catalyst's impact by creating an agent that revolutionizes conference networking through intelligent attendee matching, based on shared interests and complementary skills going beyond just job a leading Databricks SI, highlighted their success in using Domo's Agent Catalyst to optimize fleet management operations. By integrating with Databricks for real-time analytics, Koantek has adopted proactive strategies that ensure vehicle up-time and enhance route efficiency. This has been especially critical in a delivery-driven economy, where timely operations are many years of effort and investment, we have built a robust platform that includes seamless data access, advanced ETL capabilities, comprehensive data governance and security, streamlined workflows, automated alerts, approvals, and powerful visualization strong infrastructure positions us uniquely to support the development of AI-driven solutions that address real-world business challenges. Nearly every customer conversation that we are having aligns with some form of AI-driven workflow or agentic moving on to the ecosystem.I'm very happy to report that we continue to make significant improvements to our integrations with our Cloud Data Warehouse or CDW partners, including Snowflake, Databricks, Oracle, Google, and are seeing very encouraging trends in the partner metrics that we track. Conversion rates for partner source deals remains well above those for traditional marketing source early-stage partner pipeline continues to grow at a very rapid pace. Partner-sourced leads and the number of deals that moved from top of the funnel to later stages in the pipeline were up more than 200% from last from just one CDW partner. And we have several more partners we are just beginning to go to market with. So just imagine where that could lead. The model is we build strong relationships with System Integrators linked to several of these CDWs, expanding our ecosystem and market reach even Domo Everywhere solution has also helped us form new customer relationships by enabling Domo customers to securely share data with their customers, just like Filevine, who we mentioned let me highlight a few of our customer wins in the quarter, driven by our complete platform-advanced features and consumption in terms of new logos, a geospatial services company chose Domo, after completing a thorough self-guided POC that highlighted our extensive capabilities, AI/ML, pro-code features like Bricks, Jupyter Notebooks, along with the strong technical expertise of our engagement team. This was a former prospect that returned to Domo, following a failed Microsoft Fabric implementation, [boo].Another new logo in was with a mortgage company that chose Domo to gain deeper insights into their loan portfolios, branch performance, and risk management, addressing limitations in their current legacy reporting systems. They valued the company-wide analytics with unlimited user licenses provided under our consumption terms of upsells, a transportation technology company chose to expand with Domo by 10 times its original contract value, following a successful consulting project that built trust and enabled a company-wide roll-out of thousands of data sets and dashboards. They valued Domo's flexible consumption model, which allowed them to scale to 600 users, following an acquisition without traditional licensing constraints; and leveraged advanced features like Workflows, Governance, and Domo lastly, a healthcare company expanded with Domo to support wide-scale deployment and accelerated project implementation. Our consumption model was critical because the full-platform access and unlimited licenses are enabling rapid adoption and integration into core strategic business initiatives. With strong momentum from successful deployments, the company is positioned to expand further, with Domo, into new business units and embed Domo deeper in the organization through workflow automation and AI/ML has earned top honors, across several leading industry reports and awards. We were the top -ranked vendor in three Dresner Advisory Services market reports: the 2025 Wisdom of Crowds, Cloud Computing, and BI Market Study for the ninth consecutive year; the 2025 Self-Service BI Market Study for the seventh consecutive year; and the 2025 Collective Insights Report for the fourth time. And CRN recognized Domo on its 2025 Big Data 100 list in the Big Data Business Analytics effectiveness of our model is clearly on business delivered beats on all the important metrics and facilitated raises to our annual guidance. Virtually ,every important eternal metric is sales efficiency was stellar this quarter. The pipeline generated through our ecosystem partners has increased, just like we said it would. The strength of our customer relationships delivered outsized improvements in RPO and contract length, which should lead to substantial measurable improvements in gross and net transition to consumption is delivering higher usage, higher customer satisfaction, and higher retention. And our customers are leveraging AI agents at a rapid pace, demonstrating that our technology stack is perfectly set up to capitalize on the AI momentum in the model is dramatically different from three years ago and has us poised for profitable growth.I'm thrilled to be able to say that we're going to exit this year at 5% billings growth and 5% operating margin, on our way to exiting next year at 10% billings growth and 10% operating that, I'll hand it over to our Chief Financial Officer, Tod Crane. Tod Crane Thanks, exceeded our Q1 guidance for billings, revenue, and non-GAAP EPS; and were adjusted for cash flow positive. Total revenue was $80.1 million and billings were $63.9 a company, and in my role as CFO, a primary focus is driving operational efficiency and managing the company to achieve positive operating margins and free cash we leverage the early-stage success with our ecosystem partners, it further positions us for growth, while maintaining disciplined control over costs. It allows us to continue to scale our sales efforts effectively and achieve a stronger return on sales investments, supporting sustainable and profitable retention improved to 86%, from 85% in Q4 and 83% a year ago. This is the fourth consecutive quarter at 85% or above. And we continue to expect a 2 percentage point-improvement in gross retention for FY26, compared to the prior year-over-year net retention was 94%, up sequentially for the third consecutive quarter and up more than 4 percentage points year over improving retention rates are another important factor because profitable growth is difficult when retention rates are low. Retaining customers is far more cost effective than acquiring new RPO growth is also significant. Current Subscription RPO grew 5% year over year to $226 million. And our total Subscription RPO grew 24% to $408 million, an acceleration from 14% growth in salesforce productivity, higher retention rates, and accelerating RPO growth all support my confidence that we are well positioned to accelerate our billings growth over the remainder of the year, while also expanding our operating addition to improving operating margin, generating positive free cash flow remains a key focus. In Q1, adjusted for cash flow was $1.3 million, a significant improvement from Q1 last year. Our cash balance increased from $45.3 million in Q4 to $47.2 million at the end of forward, we expect our adjusted free cash flow to be slightly positive in Q2 and positive for the on to margins and profitability. Our non-GAAP Subscription gross margin increased sequentially to 81.6%, a level we expect to maintain in the near term and improve over time. Non-GAAP operating margin was 1.3% and non-GAAP net loss was $3.6 net loss per share was $0.09, based on 39.7 million weighted average shares outstanding. Because we are in a net loss position, all share and per share amounts are the same for basic and for guidance: for Q2, we expect billings of $69 million to $70 million, which represents growth of 1% to 2% year over year. We expect GAAP revenue of $77.5 million to $78.5 million and non-GAAP net loss per share of $0.03 to $0.07, assuming 40.5 million weighted average shares the full year, we are raising our guidance for billings, revenue, and non-GAAP net loss per share. We expect billings of $312 million to $322 million, GAAP revenue of $312 million to $320 million, and non-GAAP net loss per share of $0.18 to $0.26, assuming 41 million weighted average shares conclusion, I am very pleased with both our internal metrics and the results we have discussed today, which indicate that we are on the path towards sustained long-term profitable that, we will open the call for questions. Operator? Operator Thank you. We will now be conducting a Q&A session.(Operator Instructions)Yi Fu Lee, Cantor Fitzgerald. Yi Fu Lee Thank you for taking my question. Congrats on a very strong start, Josh, Todd, and Josh and Todd, can you just flip back to the macroenvironment, just to start off [conversation].Does it seem like with all the trade, tariffs, right, negotiation that's coming along, that's affecting the business? That the fundamentals are clearly affected, positively?And then, on the Domopalooza event, obviously, well attended; you were there, as well. Can you comment more on, like, the -- when you talk about one of the partners who, 2x, in terms of -- who, 2x, (inaudible), how do you get the other partners to be on the same track?Maybe, start with that. And, also, I have a couple more follow-ups. Joshua James Yeah. From a macro perspective, it's definitely not a great environment. But our team seems to be marketing through it. I think that the way that customers view is as a way, a path forward, when it comes to we mentioned, almost every conversation we're having with customers, right now, is how to leverage the data that they have inside Domo and how they can create agents. So that's been a very positive development and, it's driving activity.I think, from a macro perspective, people are definitely more hesitant than they were five years ago. But I don't think it's changed a lot in the last 12 have a few customers that talk about tariffs. But it hasn't been a large issue.I think when it comes to the partners that you're talking about, we do have one partner that's moving faster than the other one, so far. But that's been mostly tied to where we've made the investment and our product was most ready for. And we had to serially go through and get it ready for different so, we've had a lot of activity with Snowflake. And that activity, we expect also, with Databricks and with Oracle and with IBM and with Google and others, internationally. So we're having, actually, a lot of success and a lot of stuff in the pipeline, just that one's further ahead. So we do expect to see the same kind of activity from the other partners and expect that the partners are going to end up being equal amount of new logo activity as all other marketing activities, combined. Yi Fu Lee And then, Josh, can you just tell me a little bit more: like, a 6x increase on self-productivity. Obviously, feel free to have RJ comment, as well, like, in terms of: if you could break it down, why is it that it's 6x better this quarter, that? Is it because you're working more with the partner ecosystem or the combination with the consumption model that's driving it -- the 6x?And then, flipping back to Domopalooza: in terms of the pipeline building activity, obviously, you were on the floor, speaking with all your partners and some of your customers, as well. How is the pipeline building efforts on that? And how does it translate into second-half closure? Joshua James Yeah. Consumption is definitely an important component of our model. And we're, I think, seeing, in this Q1, just, really, leverage in the model work. We worked really hard on changing our model, over the last several years. And we're really starting to see the fruits of that -- and actually get operational leverage, at the same time. So we think there's going to be good profitable growth from the efficiency that we're seeing in the sales organization is, first of all, obviously, interest because of what we're doing, from an AI perspective; and then, also, what we're doing with the CDWs, that really has made our business more defensible and it's created more opportunities and when we look at our pipeline, this will be the quarter that we actually see a meaningful amount of deals closed that have been in the pipeline for the last few quarters. And so, close rates are higher; deals are a little bit think retention is going to be higher. And we go in with relationships with a partner who's espousing the positive attributes of our business and how we help the that's been a really positive development that we've been talking about for a while. This quarter, we're seeing the numbers actually hit. And we'll see those numbers in with the pipeline that we also see building for Q3 and Q4, we feel very good about the fact that, as we enter next year, we'll probably have the same amount of business that's being generated from our partners as we do from all other marketing what we're seeing, right now. And, as that plays out, we'll give more guidance around that. But I think that's what gives us the confidence that we can say, hey, for the last three years, we've been saying we're going to reconfigure the model, we're going to invest, and we're going to get back to growth. And you saw us this last quarter, we -- first-time ever, we've been positive in a Q1, net margin then, the other thing is: we're sitting here saying, not only that, we're going to be 5% margin positive and 5%, growth exiting this year; and double those numbers for exiting next year. There's a lot of upside to we're finally in a different category of company than where we've been the last three years. And this because of all the reconfiguration; the consumption model being able to get the multi-year deals because customers love what we're doing with them; and then, also, all the efforts that we put into those partnerships with CDWs. Yi Fu Lee Thanks for that, Josh. And just one -- the last one on the technology side, before I move on to talk on the financial side, is, obviously, you talked a lot about agentic saw Catalyst launch at Domopalooza. And then, there was another thing called, ML Model Management. Can you discuss what are you most excited about, in terms of the product adoption?And I think it's going to tie into my question later for Tod, like RPO, right? What is it that the customers are adopting, in terms of (inaudible) that leads to the longer duration, long contract sizes? Joshua James Yeah. I think the thing that I'm most excited is that we're teaching customers how to build their own agents. And they're doing a text message I got just this morning, from our team, and it was a customer that said, I just want to provide some feedback on the recent AI agent training, hosted by you, guys, last Wednesday. I followed along the video. I paused only to make a few data sets to use. And by the time I got to the 37-minute mark, I actually had a working AI agent that was looking at my data sets, invoices, intakes, contracts; and composing and delivering a combined weekly category management summary for sourcing managers, based on the little bit of direction I gave boom! 37 minutes, they got an agent working inside their organization because they're already using Domo. The data is already governed. It's already secure. We allowed them to use LMs inside their then, this guy goes on and says, I tried another one today from scratch; specifically to see if I could just ask the AI to iterate through a list of items for me and act on each one. It is nearly production ready. A few hours later, this AI agent accesses a data set of associates who've been recently transferred to another manager and who are corporate cardholders. The AI agent looks at a row of data containing the new manager, the old manager, and the worker who was transferred. It then generates an email based on the prompt I gave it. It then sends the email; then, it does it again until it's done with all the rows. It worked, beautifully, the first time. It composed an absolutely lovely email, even identifying more information from the data, without me telling you you see that kind of stuff. There's two agents that were created by an individual that got trained on our agentic platform. All of that is driving consumption in our product. They're much we're not seen as a visualization tool so we are definitely, here, primetime ready, for the AI agent world. Yi Fu Lee Excellent Josh. I'm going to move on -- thanks for that. I'm going to move on to Tod on the obviously, subscription RPO is a key focus, right? Short term is up 24% this quarter, up from 14% last quarter; long term, even better, 61%. Can you help us break it down, Tod? Why is this metric inflecting so much better? And what are the factors that driving customers go long term with Domo?And, also, you also upped your guidance, right, in terms of, like, beating it, as well as you raised it a little on the EPS side. What gives you confidence that you're able to gain the operating efficiency for the rest of the year? How conservative are you with the model?That's it from me. Thank you, gentlemen, for taking all my questions. Tod Crane Thanks for the question, RPO: very happy with the result there, coming in at over $400 million for Subscription RPO. That's growth of 24% year over year, with current growing 5%, long term growing 61%.I think the technology and the things -- the example that Josh just gave is very powerful, in terms of the ability of our customers to get value from our product very then, you pair that with consumption, which allows them to quickly unlock that value, not being limited by seeds, not being limited by not having access to the full platform, they can try anything. They can go in there and we're seeing that powerful combination of our good technology, our consumption model, contributing to stronger customer relationships, which is, in turn, allowing us to get longer-term the story of RPO. Very happy with the growth terms of the leverage in the model: if you look at our operating expenses over the last four or five quarters, there's been a steady improvement and a steady demonstration that we're getting leverage continuing to do that. We've made great progress there. And, as we look ahead and model out what the rest of this year looks like, we see an opportunity to continue to expand margins. And we will continue to do that. Yi Fu Lee Okay. Thanks, again, Josh. Congrats. Operator Derrick Wood, TD Cowen. Jared Jungjohann Hi, team, this is Jared Jungjohann, on for Derek we incorporate new consumption dynamics and AI elements into your cost of goods sold, how should we be thinking about gross margin trajectory over the medium term? Tod Crane We were at 81.6% subscription gross margin this quarter. We expect it to remain around that level for the near term, with the long-term goal of having it increase from terms of the dynamic related to consumption, it does tie the revenue more closely with the cost. So that's, in large part, the reason why we're expecting that to increase over time, going forward. Jared Jungjohann Awesome, appreciate that color. And then, can you talk to some of the trends you're seeing in your enterprise space versus commercial base?And then, maybe, how do these evolving partnerships impact that? Are you seeing these partnership deals skew larger or -- just some color there? Tod Crane Yeah. I'll jump in on that one. And, Josh, feel free to chime in, On the enterprise side, it's a large portion of our business. It's an important part of our business. We've had great success there over the years. We have a lot of great enterprise if we look at the leads that are coming in from partner, a significant portion of those are enterprise leads. And so, we're seeing this as a real opportunity to continue to expand our presence in the enterprise and to continue to have success there. So we're definitely encouraged by that. Jared Jungjohann Awesome. And then, as you gain more traction with these cloud partners and get adopted into the modern stack, what area of your solution set are you seeing these customers really dive into? Joshua James Yeah. One of the biggest things with the clouds is they're looking to get more and more information into their clouds. They want to hydrate their clouds. And we have a unique ability to do have more connectors than anybody in the industry. And we have a very robust system to be able to help them manage the we walk into an account, instead of the 100 or so people that might be using a CDW; when we're in an account, we might see 10,000, 50,000, even 100,000 so, if you can have all of those people also accessing that data and formats that they want in a secure way, then it just drives more adoption of that CDW and secures the CDW's relationship even of the CDWs are out there trying to build other use cases. And they're all trying to expand beyond IT central functions and go into creating marketing use cases and sales use cases and operations use cases. And that's our bread and it really is a good combination of us with the CDWs. And one of the things that we get out of that is we get a CIO-blessed relationship, which makes our relationship with that customer much stronger in our ability to weather different changes they are going seeing -- we have an ability to sit on top of multiple CDWs. And that's actually something that CIOs like; as well as, people are shifting their strategies or adopting one CDW and moving to others. And it really puts us in a unique position. Jared Jungjohann Awesome. I'll just finish up with one last one. But real positive commentary around the guidance and what you're seeing out of the CDW that strength in commentary, I'm wondering how you're thinking of investing in growth versus investing in margins. You've obviously factored in a little bit of op margin expansion. But, maybe, just talk to that a you. Tod Crane Yeah. It's a great question. It's always a balancing act. We feel confident that we're getting the right investments in place and that we have an opportunity to keep that momentum going with the CDWs, while still expanding we're not trying to get to 30% margins overnight. We're going to slow and steady expansion towards that 5% and then, that 10% level, over the next couple of that's going to allow us plenty of room to continue to invest in these partnerships. Operator Eric Martinuzzi, Lake Street. Eric Martinuzzi Curious to learn a little bit more about your pricing policy on your consumption-based contracts. Just as you've got -- as you've been at this for now: we're in our third year or so of the consumption-based pricing these come up for renewal, is there an opportunity to raise prices? Or is it really just more there's a natural -- as the customer uses the product more, they consume more and that's what drives a higher year-over-year growth in that consumption-based installed base? RJ Tracy Yeah. Our focus on consumption pricing is to make sure that -- this is RJ Tracy, CRO, with our real goal with consumption is to align the value that customers get with how they pay. And so, it's a natural motion for us to go work with customers and help them get more value out of the platform. Solve more use cases, get them using agentic AI solutions that help them to take action on the as they use the product, then it drives the usage up; which we want to go in and then, help them get a better rate on their consumption price. So it's a pretty natural motion for we're still figuring out the best methods for adoption. But it's a real natural motion for customers because as they get more value, then they pay more. Eric Martinuzzi Got you. And then, the cohorts: again, we're looking at -- this is a consumption-based question. As you've seen those cohorts come back for renewal, you already talked about, hey, we're up to 70% of the installed -- of the ARR is on a consumption-based pricing those cohorts -- are you seeing the consumption-based cohorts as more likely to adopt the AI and the newer products? Or is it an equal mix between the folks who aren't on consumption-based that are on the per seat-based pricing? RJ Tracy Yeah. They're a lot more likely to adopt because there's not a restriction or a paywall in front of them before they you buy Domo, the entire platform is available to our customers to use. When we were on seat-based pricing, any feature that they hadn't paid for was hidden behind the paywall. And so, it created a barrier of entry for customers to go in and adopt that technology; where, now, if they want to try -- like the customer example that Josh read, if they want to try out one agent, they can go in, and in 37 minutes, build an agent. And that might only take a couple of then, they'll decide whether they're getting value from that or not. If they keep it running, then it will consume more and more over the year. And if not, they can shut it off and they paid, maybe, a couple of credits to try something significant increase in adoption across the entire platform, including users. Eric Martinuzzi Got it. And then, last question is around the progression of the billings growth implied in the I take your Q2 billings growth, midpoint looks like a little over 1% growth. But you're talking about exiting the year: so a Q4 billings growth rate of 5%. Is that based on things that you already have in the pipeline? Or is that yet to be filled in at the top of the funnel? Tod Crane Yeah. It's based on a number of factors. We consider a number of different inputs in our financial is certainly one of them: the trajectory of the pipeline, pipeline generation, quality of the pipeline. And then, just historical trends: what we're seeing, in terms of rep productivity, those kind of yeah, based on everything we're seeing, we have confidence that we'll exit at 5%. And so, you can do the math between what we guided for Q2 and the 5% for Q4 and get to what we're going to be around for Q3. Eric Martinuzzi Got you. Thanks for taking my questions. Tod Crane No problem. Thanks, Eric. Operator Pat Walravens, Citizens JMP. Great. This is [Nick], on for Pat. Congrats on the at Domopalooza and on the call today, you mentioned the 200 customers who wanted to try Agent Catalyst. I was wondering if you could speak a little on what demand looks like today for that then, Tod, one for you. It's been almost nine months since you stepped into the role as CFO. What is one thing that's been harder than you thought? And what is one thing that has been easier than you thought, since assuming your new role? Joshua James Yah. I talked a little bit about the kind of conversations we're having with our customers. They're just ongoing and continual. And they're not just exploratory, right? Like I mentioned, they're actually making things in these trainings and in these I'm going to have RJ talk a little bit more about the opportunities and some of the activities that we're seeing in our pipeline. RJ Tracy Yeah. As we get leads, especially from the ecosystem, we're seeing a ton of customers that want to dive into AI and figure out what that looks like within their company, within their org. And a lot of those AI use cases require need access to data. They need to be able to transform that data. They need a way to surface it out or embed it to where their users are at or where their customers are we're seeing use cases all across our stack. And the great thing is that they can come in and buy just the components that they the entire stack is available to them. So ,at any time, they can start to use other components to help them and will help drive consumption and give more value to our customers. Joshua James From an AI perspective on the agents, talk about some of the ServiceNow stuff that we're seeing, as well. RJ Tracy Yeah. We have a customer, right now. They're surfacing particular use cases in ServiceNow. But it requires a human intervention to come in and to actually do all the work. So we're supplementing some of what they're doing in ServiceNow with our Agentic one of the use cases was helping get data to hydrate a warehouse. And, in this example, customers can start a ticket in ServiceNow. They want to bring data into their typically, that requires, now, a person to then take that ticket, go out, do an integration, upload data; where, now, Domo is automating that entire process. But we still allow for that human in the loop to approve or to reject a request. But if they approve it, then the data is uploaded immediately and that process now takes 30 seconds to a minute instead of, sometimes, several days or weeks to get that human seeing customers that want to automate labor management, where they want to automate the ability to help customer -- their employees that, maybe, can't work the next day and need to fill is helping them find a replacement. It's automating the process for that. It's immediately notifying people and asking if they can accept a shift that they weren't expecting to work. And that entire process can happen in seconds, instead of having someone have to go manage thousands of employees to figure out who can cover those are some of the examples and use cases that we're seeing. Got it. Thank you, RJ. Thank you, Josh. Tod Crane Yeah. And then, on your other question, in terms of (inaudible) harder and easier: I'll probably characterize that a little bit differently, if that's okay. I'll probably put it in categories of things I really want to -- something I really want to fix and things that I've been happy with how they've been for me, we're obviously pleased with the improvement in gross retention over last year and over last quarter. But that's a big, big focus for us, as an Executive Team, to continue that march toward 90%-plus gross retention. So that's the one thing that I'm really focused on in terms of very happy with our RPO performance. We've talked about that, already, a few times. But that 5% current RPO growth, not a huge number but it does point to that 5% exit rate that we talked about earlier and de-risk then, that longer-term portion of RPO also derisks our forward-looking revenue and our forecast beyond this year. Got it. Thank you for that. And congrats, again, on the quarter. Operator Thank that, that concludes today's may disconnect your lines, at this you for your participation.
Yahoo
21-05-2025
- Business
- Yahoo
Q1 2025 Pony AI Inc Earnings Call
George Shao; Senior Director - Financing, Investment & Strategy; Pony AI Inc Jun Peng; Chairman of the Board, Chief Executive Officer, Co-Founder; Pony AI Inc Tiancheng Lou; Co-Founder, Chief Technology Officer; Pony AI Inc Haojun Wang; Chief Financial Officer; Pony AI Inc Ming Hsun Lee; Analyst; Bank of America Bin Wang; Analyst; Deutsche Bank Yiming Qiu; Analyst; Huatai Securities Co., Ltd. Operator Ladies and gentlemen, thank you for standing by and welcome to Pony AI Inc's first-quarter 2025 earnings conference call. (Operator Instructions) As a reminder, today's conference call is being recorded, and a webcast replay will be available on the company's Investor Relations website at I will now turn the call over to your host, George Shao, Head of Capital Markets and Investor Relations at Pony AI. Please go ahead, George. George Shao Thank you operator and hello everyone. We appreciate you joining us today for Pony AI's first-quarter 2025 earnings call. Earlier today, we issued a press release with our financial and operating results, which is available on our Investor Relations website. Joining with me today are Dr. James Peng, Chairman of the Board, Co-founder and Chief Executive Officer; Dr. Tiancheng Lou, Director, Co-founder and Chief Technology Officer; and Dr. Leo Wang, Chief Financial Officer. They will provide prepared remarks followed by a Q&A session. Before we begin please refer to the Safe Harbor Statement in our earnings release which applies to this call as we will be making forward-looking statements. Please also note that we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported under GAAP in our earnings release available on our investor relations website and filings with the SEC. I will now turn the call over to our Chairman, Co-Founder, and CEO, Dr. James Peng. Please go ahead. Jun Peng Thanks, George. This is James Peng, Founder and CEO. 2025 is a year of scaling up for Pony AI and we embraced it with strong growth momentum. Before we dive into our business development, I would like to highlight four key milestones. Firstly, revenue from our Robotaxi services doubled year-over-year for the first quarter of 2025 with fare charging revenues grew approximately eightfold. This is a landmark validating our commercial deployment readiness. Secondly, we launched our seventh-generation autonomous driving system in the Shanghai Auto Show. The Gen 7 system achieves a 70% reduction in bill of materials, basically bond costs, compared with our last generation, the Gen 6. This showcased our technological advancement to effectively drive cost and efficiency. Thirdly, we have secured the production capability and all the relevant components to grow our fleet to 1,000 vehicles by year end, which will significantly increase our fleet density across our operational network. Lastly, we reached strategic partnerships with some key partners, such as Tencent and Uber, to forge comprehensive ecosystems, both domestically and worldwide. Now let me walk you through the details of our business progress. In late April, we showcased the Gen 7 Robotaxi lineup at the Shanghai Auto Show. Gen 7 is a game-changing breakthrough in autonomous driving technology as 100% of the sensors, components, and all the add-ons are automotive-grade, which means that Gen 7 will have an extended product lifecycle, rock-solid reliability, and also next-level safety. Its modular architecture also enables rapid deployment across multiple vehicle platforms, starting with three Robotaxi models we unveiled in the Shanghai Auto Show. Through our strategic partnership with leading OEMs, including Toyota, BAIC, basically Beijing Auto, and the GAC, the Guangzhou Auto, Gen 7 Robotaxis will enter mass production and deployment, and thereby growing our fleet size to 1,000 vehicles by year end. Most importantly, I want to highlight that such technological advancement and large-scale production and deployment capabilities have driven a measurable increase in our efficiency, lowering both the capital expenditure and also operational costs. The two key underlying drivers are, first, on the vehicle economics. Our Gen 7 Robotaxi total cost per vehicle, this includes actually both the vehicle platform and also the ADK, the Autonomous Driving Kit's BOM costs, both have all been reduced, especially with the ADK's BOM costs coming down by 70%. The cost down is driven by multiple design optimizations, including an 80% reduction in autonomous driving computation and also 68% reduction in the LiDAR costs. These efficiencies demonstrate the power of our system integration as well as scalable production approach, positioning us competitively against the industry benchmarks. Second, on operational costs. In this front, we have reached a remote assistant to driver ratio of up to 20. This means that one remote assistant can effectively monitor 20 vehicles. In addition, we largely reduced our insurance cost as our commercial insurance premiums stand at approximately half of the typical cost for traditional human-operated taxis. The aforementioned operational cost reductions are the result of our proven safety track record and also years of Robotaxi operational experience. Now moving to the operational expansion. This is another cornerstone that will empower our quick growth. With strong foundation in place for the future scaling, our total commercialized operational domains across Beijing, Guangzhou, Shenzhen, and Shanghai now span over 2,000 square kilometers. This is nearly 20 times larger than the city area of San Francisco. Our vast coverage includes some high-value transportation hubs such as central business districts, airports, and high-speed train stations. Notably, we secured China's first fully driverless commercial Robotaxi license in Shenzhen's Nanshan District in late March this year, unlocking operations in the city's core economic and transportation hubs. Regarding the market adoption of our Robotaxi service, the number of registered users on our mobile app, basically the Pony Pilot App, increased by more than 20% quarter-over-quarter in the first quarter of this year. We continue to enhance the user experience through innovative operational models, product features, and in-car infotainment systems. Our user growth trajectory will be further amplified by our new strategic partnership with Tencent, which enables us to integrate our Robotaxi services into Tencent's Weixin Mobility Services and also Tencent Maps. As a result, we can tap into China's billions of user base. As we launch Gen 7 Robotaxi later this year, we will expand our capability to meet the fast-growing user demand. It sets a solid foundation to drive our future fare charging revenues through optimized fleet utilization and enhanced customer experience with faster pickup time, superior safety, and premium comfort. Now let me share with you our global expansion progress. At Pony AI, our mission has always been, since the day we were founded, has always been autonomous mobility everywhere. Our global footprint now spans across Europe, the Middle East, South Korea, Southeast Asia, and beyond. Recently, we have achieved multiple breakthroughs in these areas. First, we have forged strategic alliance with key industry partner players. We recently partnered with Uber, which will enable users to access our Robotaxi service directly through Uber's platform. The partnership is expected to first launch in a key market in the Middle East later this year with the goal of scaling deployments to additional international markets in the future. We are also collaborating with ComfortDelGro on a joint Robotaxi pilot program. ComfortDelGro is one of the largest land transport companies headquartered in Singapore and operates in 13 markets covering Europe, China, Australia, and others. Second, we are pleased to see the ongoing favorable regulatory and testing programs globally. During the first quarter, we have secured an L4 Robotaxi testing permit from Luxembourg's Ministry of Mobility. And we also started road testing in Seoul's Gangnam district of South Korea. All these developments collectively demonstrate our platform's adaptability to complex global conditions while positioning Pony AI for future commercial scaling. In summary, I think the mass production and large-scale deployment of our Gen 7 Robotaxis remain a top priority for us. Through continuous technical innovations, we are seeing accelerating production coupled with significant cost reduction. Given the structural efficiency advantages of the Gen 7 Robotaxis, we have a clear line of sight to break even and long-term profitability. With that, I will now pass it over to our CTO, Dr. Tiancheng Lou. Tiancheng Lou Thanks, James. Hello, everyone. This is Tiancheng. So it's a great pleasure to share with you the latest advancement and progress in our technology. So when we showcased our Gen 7 auto driving system during the Shanghai Auto Show in late April, I also shared the progress of our PonyWorld and hardware system. PonyWorld, as an industry-leading AI-powered world foundation model, has built a high-fidelity training environment and evaluation system, breaking through the limitation of imitation learning. Each week, PonyWorld generates test data exceeding 10 billion kilometers. The breadth and complexity of the data accumulated have far surpassed the data that a human driver can ever collect. This generative world model trains our proprietary virtual driver, a full-stack system featuring integrated software and hardware, where the virtual driver in turn provides valuable human feedback. It fosters the virtual cycle of continuous enhancement, accelerating the improvement in safety and reliability of our auto driving technology. The virtual driver has demonstrated our proven L4 auto driving capability in the real world, successfully navigating complex urban environments across all urban cities in China, operating through rush-hour traffic and the inclement weather. By the end of the first quarter, we have accumulated over 6 million kilometers of driverless operation, a clear validation of our technology's maturity and its readiness for large-scale deployment. Next, let me elaborate how this advancement drives operational cost optimization across the board. From a mass production perspective, hardware cost reduction remains a fundamental challenge that no automaker can avoid. With respect to our Gen 7 Robotaxis, our in-house developed auto driving domain controller is world's first to achieve full-scenario Level 4 auto driving built on auto grid chips, featuring extended product lifecycle and a mileage lifespan of 600,000 kilometers. Regarding computing platform, we are the first player in the L4 industry to adopt autonomous-grade SoC. This advancement has successfully reduced the domain controller's size, weight, power consumption, and cost, each by 50% to 80%. Our proprietary where PonyWorld has also effectively improved computing efficiency by three times through AI-influenced optimization, model distillation, and other technological innovations, significantly outperforming the broader L4 industry. As a result, we are able to adopt more cost-efficient computing power with a total capacity of 1016 TOTS. This cost-efficient approach enables us to meaningfully reduce overall costs and reach break-even as we scale up our fleet in the future. In terms of LiDARs, we have also made significant improvements to software algorithms to adapt to cost-efficient LiDARs. For Gen 7 autonomous driving kits, we opt for highly cost-efficient semi-solid-state LiDARs. While this choice may involve many trade-offs in individual sensor performance, we have compensated through advanced software algorithms that reduce the noise point by up to 30 times, ultimately resulting in enhanced overall system performance and a 68% cost reduction compared with the previous generation. For sensors, more broadly, we have achieved significant performance improvements through upgrading not just the hardware but also the algorithms. A key component of overall cost is related to remote assistance. Unlike remote control, overall system features request-based remote assistance providing suggestions to autonomous driving vehicles rather than direct or indirectly controlled. Over virtual technology allows us to achieve industry-leading remote assistance-to-vehicle ratio of 1 to 20, compared with 1 to 3 for the same period of last year. We expect this trend to continue and improve as our technology advances. Over-virtual driving enables smarter navigation and advanced monitoring capability. For instance, in scenarios like traffic police gesture recognition, no additional human support is required. Similarly, during passenger pick-up and drop-off, there is no need to manually confirm passenger status and inspect the vehicle's cabin. This allows us to operate Robotaxi services with a high-efficiency remote assistant to vehicle ratio, significantly reducing operational costs. This metric also shows how far we have advanced beyond industry standards. Moreover, our technical innovations have significantly enhanced the safety of our Robotaxi fleet, leading to a more favorable insurance economics. As James mentioned, over-commercial insurance premiums are approximately 50% of typical costs of traditional government-operated taxes. This reduction is the result of thorough accurate assessment by insurance providers who have verified our assessment log incident and claim rate. This continued decrease in insurance costs is a direct outcome of over-safety performance and a testament to the reliability of our over-autonomous driving system. Moving forward, we still have significant room to further solidify and expand our technological leadership and thereby scale up for future commercialization deployment. Before I conclude, I want to recap the tremendous effort we have made over the past few years to prepare for mass production, both on software and hardware fronts. Our Pony World platform leads the industry in areas such as technology and model training. On the hardware side, we have optimized the key components required for Robotaxi operations, including sensors, LiDARs, and domain controllers. Not only through traditional cost reduction measures, but also through parallel software driven enhancement that significantly boost our overall system performance. This concludes my prepared remarks. I will now pass the call over to our CFO, Dr. Leo Wang, for a closer look at our financial results. Leo, please go ahead. Haojun Wang Thank you, Tiancheng. Hello, everyone. This is Leo. Before reviewing our first quarter financial results, I would like to reiterate that as we enter this pivotal year for scaling up the Gen 7 Robotaxi fleet, we remain fully committed to disciplined investment in mass production and deployment. We will ensure strong operational momentum while maintaining solid financial resilience, all to create long-term value to our shareholders. Moving to our financial performance for the first quarter of 2025, we started this year with a strong note, demonstrating solid execution of our go-to-market strategy. Revenues totaled at USD14 million, up 11.6% year-over-year, mainly driven by rapid growth in Robotaxi services. The quarter-over-quarter volatility was primarily due to the variation in revenue recognition of project-based engineering solution services and product sales, a trend consistent with historical pattern. In the first quarter, Robotaxi's service revenue were USD1.7 million, growing significantly at 200.3% year over year. This growth was driven by both fare charging and the project-based engineering solution services, with fare charging revenues achieving faster growth rate, increasing by roughly 800% year over year. The strong growth rate was attributed to the expansion of our public-facing fare charging Robotaxi operations in Tier 1 cities in China, as well as our optimizing operations for diverse user groups. Robotaxi services revenue grew by 4.2% year over year, to USD7.8 million for the first quarter, primarily driven by contributions from new clients. Licensing and application revenues were flattish year-over-year at USD4.5 million. We saw increasing orders and delivery for Autonomous Domain Controller, ADC sales primarily driven by new robo delivery clients. The total cost of revenue was USD11.7 million, up 17.9% year over year, in line with revenue trends. Our gross profit reached USD2.3 million, resulting a gross margin of 16.6%, down from 21% in the same period last year. This decrease was mainly due to the change in revenue mix on increased ADC sales for new robo-delivery clients in the first quarter. That being said, we are actively working on initiatives to reduce gross margin variability for the coming quarters. Total operating expenses were USD58.4 million, an increase of 56.3% year-over-year. Excluding share-based compensation expenses, non-GAAP operating expenses were USD49.3 million, up 35% year-over-year. The increase was primarily due to investment in the mass production for Gen 7 and one-time expenses associated with share awards settled upon the completion of IPO. Additionally, we increased employee expenses in the first quarter to strengthen our R&D capacity for concurrently developing three Gen 7 vehicle models. Reflecting the investment preparing for our upcoming production of Gen 7, net loss was USD37.9 million, compared to USD20.8 million in the first quarter of 2024. Non-GAAP net loss was USD28.4 million, compared to USD25.7 million in the first quarter of 2024. Turning to our balance sheet, our combined cash and cash equivalents, restricted cash, short-term investments, and long-term debt instruments for wealth management was USD738.5 million as of March 31, 2025, compared to USD825.8 million at the end of 2024. The cash outflow was primarily driven by our Gen 7 R&D effort and supply chain preparation, in which the procurement of some key components kicked off ahead of the mass production. With the imminent scaling up and commercial deployment, we believe our current cash reserve is sufficient for our future growth and will continue to explore more opportunities to ensure sustained support. Looking ahead, we are thrilled to embark on a chapter in our journey towards mass production and deployment, aiming at scalable commercialization. With our core technological advancements as the foundation, we will continue making disciplined investments to strengthen mass production capability and drive long-term cost and operational efficiencies. Our robust go-to-market strategy will also allow us to gradually reduce financial volatility and build a more predictable path to growth. I will now turn the call over to the operator to begin our Q&A session. Thank you. Operator Thank you. (Operator Instructions) Ming Hsun Lee, BofA. Ming Hsun Lee Thank you, James, Tiancheng, and Leo. Congrats for the first quarter results and also your launch of Gen 7 Robotaxi product. So I have one question. As you mentioned, 2025 is a year of scaling up. How should we understand your progress throughout this year, is there any color or pipeline for 2026? Jun Peng I'll take this question. This is James. We actually have a very clear pipeline for the Gen 7 Robotaxi mass production. This will, as I mentioned, this remains to be our main focus for this year. We expect Gen 7 will enter mass production for the second quarter and thereby bring in the total number of our fleet size up to 1,000 vehicles by year end. In addition, the large-scale deployment will ramp up gradually throughout the second half of the year. We are especially working on the following three areas to ensure a quick ramp up. First, we are closely -- working very closely with the OEM partners such as Toyota, GAC, and BAIC for the mass production across the component sourcing pre-installment and the final assembly, thereby ensuring that each Robotaxi meets the highest industrial standards of quality and safety. Second thing we're working on is our agile and flexible approach to sourcing the key components allows us to rapidly adapt to the changing demand, ensuring our stable supply chains and supporting the efficient execution of our mass production plans. Lastly, our years of collaborations with the central and local governments have established a proven track record of our superior safety level and operational capability. This enhances our credibility and positions us to secure the required licenses. Paving the way for commercial deployment of our Gen 7 Robotaxis. With the aforementioned three things that we are working on, we will focus on reinforcing these critical foundations to realize robust growth momentum of our fleet size, ensuring a scalable and sustainable expansion. As for year 2026, I think our scale up will be even more accelerated. We will produce more autonomous driving vehicles and then deploy them in China and also the international markets. With this, back to the operator. Operator [Ting Hong], Goldman Sachs Thank you. Congratulations on the results. I have two questions. And the first one is, while you emphasize China's first strategy last quarter, we have now seen some progress on global markets this time. So could you elaborate more on your evolving global strategy and to what extent does the China market remain a core focus at this stage? Thank you. Jun Peng Sure. This is James again. I think I'll take this one. As I mentioned in my prepared remarks, Pony AI's mission has always been Autonomous Mobility everywhere. While we currently prioritize the China market, giving its relatively mature regulatory environment, we believe our established ecosystem, technological advancement, and the scaled operation in China have empowered us to enter new markets with proven capabilities, experiences, and proven business models. At this stage, we are aiming for markets with strong mobility demand, advanced infrastructure, and welcoming regulations. While the commercialization of these international markets is still at the early stage, we relentlessly work hand-in-hand with our global partners to showcase the technology readiness, move forward local commercial driverless regulations, build momentum for public acceptance, and generate revenues along the course. This approach actually mirrors our achievements that we have already established in the Tier One cities in China over the recent years, which we believe our successful track record in China will also help foster greater confidence for these new markets. Recently, we have formed strategic partnerships with key global players one of them is Uber, with plans to launch our Robotaxi service on their platform, starting in a key market in the Middle East this year and expanding to other international markets. Another partner is ComfortDelGro, one of Singapore's largest transport companies operating across 13 countries, including Europe, China, and Australia. We also continue to make regulatory and testing progress globally, having secured an L4 Robotaxi testing permit from Luxembourg, and also initiated road testing in Seoul's Gangnam district in South Korea. These successes have provided us with valuable experience as we explore future opportunities beyond the China market. With this, back to the operator. (multiple speakers) My second question is, you deliver very impressive revenue growth in Robotaxi. What factors are driving behind this quarter, and do you believe this is sustainable in the upcoming quarters? Thank you. Haojun Wang Yes, this is Leo, and I'll take this question. So the revenue growth in Robotaxi segment was driven by both fare charging and project-based engineering solution services. With fare charging revenues achieving at a much faster growth rate, increasing by roughly 800% year over year. The strong growth rate was attributed to the expansion of our public-facing fare charging Robotaxi operations in Tier 1 cities in China. We also optimized our operations to cater to diverse user groups, such as interactive reward features. I would also like to take this opportunity to explain our Robotaxi revenue structure. Our revenue are currently generated from two main streams. The first stream consists of engineering solution services, which are recognized upon the achievement of project milestones. Hence, this is project-based and could fluctuate among quarters. The second stream is recurring revenue, primarily from our virtual driver operations, such as our Robotaxi fare charging services. While the project-based revenues currently make a larger portion in our total Robotaxi revenue, we believe the non-recurring revenues we are generating from partners, such as ride-hailing platforms, OEMs, and other parties are very critical to enhance and advance our recurring revenue stream. These collaborations also further pave the way for a robust long-term monetization model. As a result, we anticipate some natural volatility in revenues from-to-quarter in this segment. That being said, we will gradually reduce financial fluctuations and are very confident to deliver a strong growth trajectory in the long term. I'll get back to the operator. Operator Bin Wang, Deutsche Bank. Bin Wang Thank you for taking my question. My small part of technology perspective, you mentioned that in the ADK pricing was quite dramatic. Did you need to upgrade your software to fulfill this ADK cost reduction, in particular, what's the improvements you're doing for computing power, you also mentioned that you actually would decline 48% of the cost for computing power? Thank you. Tiancheng Lou Thank you. I will take this question. So this is Tiancheng. Before I answer your question, I would like to say that we believe in the field of front-driving technology. Pony AI is poised to represent China's leading companies in embracing the deep-thick moment. So by optimizing our PonyWorld and enhancing engineering capabilities, we have designed a cost-effective hardware and software system. This enables us to significantly improve inference performance while reducing associated cost, even with auto grid SoC and the lower-precision LiDAR sensors. So for instance, the old PonyWorld had effectively improved computing power efficiency by three times through AI inference optimization, auto-distillation, and other innovations. Significantly outperformed the broader L4 industry. As a result, we're able to adopt more cost-efficient computing power with a total capacity of [1,016 TATs], compared with industry pairs typically range from 2,000 to 5,000 TATs. In terms of the inference computing, we have implemented numerous optimizations, such as optimizing operators in the AI model, increasing computational parallelism, and improving model memory efficiency to enhance inference performance. So all these efforts help us to improve cost efficiency without giving up performance, proving that we're able to realize the cost-effective and the scale of L4 driverless auto driving. Thank you. I will give back to the operator. Operator Qiu Yiming, Huatai Securities. Yiming Qiu Thank you for taking my question. So congrats on your expansion in Robotaxi services. So we noticed that the Ministry of Industry and Information Technology of China has recently issued some regulatory requirements regarding driver assist. So I just wonder that could this potentially have an impact on Pony AI? Thank you. Tiancheng Lou Yeah, this is Tiancheng. I will take this one. So I think a lot of people mistakenly equate L2 driver assist with L4 auto driving. Recently, the Ministry of Industry and Information Technology, MRIT, issued a notice clearly states that L2 is not equal to L4. The key requirement from MRIT includes, first, the manufacturers or solution providers must avoid using misleading terms, such as auto driving, intelligent driving, when promoting L2 driver assist system. Second, manufacturer solution providers are required to clearly define the capabilities and safety measures of driver assist system. Terms like zero takeover or hands-off must not be used. And the responsibility of the driver for continuous monitoring must be emphasized. So we believe this is a clear beneficial for Pony AI as it helps foster a comprehensive and clear understanding of distinctions between L2 and L4 for the public. That's also the reason why we consistently emphasize that L2 and L4 are fundamentally different in value add to the customer. Being more specifically, only L4 can truly fulfill user's need in the situation where they are looking for relaxation or even wish to take a nap while auto driving system is on. So I would like to go into more detail about the technological difference between L2 and L4 systems. So L2 system widely uses imitation learning. The AI drivers learn by copying human behavior from real-world driving data. The limitation of imitation learning is that AI driver cannot understand the reasoning behind the driving behavior. So as a result, it is not safe enough to handle ever-changing traffic scenarios. For L4 system, we use the reinforcement learning and over generative PonyWorld. So under PonyWorld, our virtual driver teach itself through a large amount of generative data. This allows our virtual driver to understand why by analyzing the outcome of every action, teaching them to make smarter decisions in different scenarios and eventually surpass the safety of human drivers. So over time, our virtual driver trained under PonyWorld developed advanced skills needed for complex tasks such as multi-navigating urban areas, handling unpredictable traffic scenarios, or safely operating for 500,000 hours without any human intervention. More importantly, the key compatible edge differs significantly between the two approaches. For imitation learning requires large amount of data, while reinforcement learning relies on heavily on AI motor type abilities. These underlying distinction creates a considerable barrier, making it challenging to transition from one to another. It basically requires companies to start over and build a whole team from (inaudible) which means it cannot be simply acceleration through prior experience. Yeah, thank you. I will go back to the operator. Operator [Tsa Lei], Jeffries. Hi. Thanks for taking my question. My question is regarding the US-China tariff issue, which appears to be easing at the moment. But I'm still wondering, well, it has to have any potential negative impact on the operations, how many materials are you sourced from the overseas market? Haojun Wang Thank you and this is Leo. I'll take this question. We believe the potential impact from the tariffs issue will be very minimal to our operation. First, the majority of our supply chain is domestically sourced. Second, over the past few quarters, we have enhanced our supply chain resilience in response to the evolving geopolitical landscape. This includes diversifying suppliers and also increasing inventories when necessary. As a result, we are well prepared to manage this risk. In addition, I would like to highlight that our Gen 7 mass production plant has also been reflected with these assumptions and also uncertainties. Therefore, we are confident that our full-year target of deploying 1,000 unit fleet size is on track and will not be affected by the changing trade environment. I will now get back to the operator. Operator Thank you. This concludes our question-and-answer session. I'd like to turn the conference back over to management for closing remarks. George Shao Thank you once again for joining us today. If you have any further questions, please feel free to contact our IR team. We look forward to speaking with you in the next quarter. Operator Thank you. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-05-2025
- Business
- Yahoo
Q1 2025 Sow Good Inc Earnings Call
Cody Slach; Investor Relations; Gateway Group, Inc. Claudia Goldfarb; Co-Founder and Chief Executive Officer; Sow Good Inc Brendon Fischer; Interim Chief Financial Officer; Sow Good Inc George Kelly; Analyst; Roth Capital Partners Igor Novyartsev; Analyst; Lairs Capital Operator Good morning, everyone, and thank you for participating in today's conference call to discuss Sow Good financial results for first quarter ended March 31, us today are Sow Good Co-Founder and CEO, Claudia Goldfarb; and Interim Chief Financial Officer, Brendon Fischer. Following their remarks, we'll open the call for analyst we go further, I would like to turn the call over to Mr. Slach as he reads the company's Safe Harbor Statement within the meaning of Private Securities Litigation Reform Act of 1995 that provides important cautions regarding forward-looking statements. Cody, please go ahead. Cody Slach Good morning, everyone, and thank you for joining us in today's conference call to discuss Sow Good's financial results for the first quarter ended March 31, 2025. Certain statements made during this call are forward-looking statements, including those concerning our financial outlook, our competitive landscape, market opportunities and the impact of the global economic environment on our statements are based on currently available information and assumptions, and we undertake no duty to update this information except as required by law. These statements are also subject to a number of risks and uncertainties, including those highlighted in today's earnings release and our filings with the information concerning these statements and the risks and uncertainties associated with them is highlighted in today's earnings release and in our filings with the SEC. Copies are available on the SEC's website or on our investor relations we will discuss adjusted EBITDA and non-GAAP financial measures on today's call. A reconciliation of adjusted EBITDA to net income or loss, the nearest comparable non-GAAP financial measures discussed on today's call is available in our earnings press release at our investor relations that, I will turn the call over to Claudia. Claudia Goldfarb Thank you, Cody, and good morning, everyone, and thank you for joining us today. We're encouraged by the continued momentum in the first quarter of 2025 with a 79% increase in revenue from the fourth quarter of 2024. This tracks closely with the expectations we laid out during our last there is still work to be done, Q1 delivered meaningful progress across key areas, particularly in operational execution and retail expansion. The strategic actions we took last year to make the business more agile and efficient are paying off, and we're seeing renewed consumer enthusiasm for our freeze-dried candy said, we continue to feel the effects of global CPG giants entering the category we pioneered. These companies have used their scale and spending power to secure shelf space often at the expense of smaller, more innovative brands like we believe the initial novelty and market impact of these launches is wearing off. As we gain momentum, it's clear that consumers are returning to our brand for our superior assortment, unmatched crunch and ongoing innovation. I'll share more on the progress we're making first, I'll turn it over to Brendon to walk us through our Q1 financials. Brendon? Brendon Fischer Thank you, Claudia. Jumping right into our financial performance. Revenue in the first quarter of 2025 was $2.5 million compared to $11.4 million for the same period in 2024. The decline was primarily driven by softening demand due in large parts to increased competitive pressure. Gross profit for the first quarter of 2025 was $1.1 million compared to $4.6 million for the same period in margin was 45% in the first quarter of 2025 compared to 41% in the year ago period. The decrease in gross profit was largely due to lower revenue, partially offset by lower cost of goods sold. The improvement in gross margin for the first quarter primarily reflects the lower cost of goods sold in the expenses in the first quarter of 2025 were $3.5 million compared to $3.7 million for the same period in 2024. The year over year reduction was largely the result of a decrease in bonus compensation and lower legal services loss in the first quarter of 2025 was $2.6 million or a loss of $0.23 per diluted share compared to net income of $511,000 or $0.06 per diluted share for the same period in 2024. The decline reflects lower gross profit, partially offset by reduced operating expenses in Q1. Adjusted EBITDA in the first quarter of 2025 was negative $0.8 million compared to $2.5 million for the same period in to the balance sheet. We ended the quarter with cash and cash equivalents of $1.6 million compared to $3.7 million as of December 31, debt, excluding operating losses was $2.7 million. However, subsequent to quarter end, we entered into exchange agreements with all of our outstanding noteholders with notes payable this year. Under the exchange agreements, existing notes were exchanged on a dollar for dollar basis for new notes maturing five years from the date of new notes are convertible at the option of the holder in whole or in part into shares of common stock based on our price per share equal to the average closing price of our common stock during the five trading days immediately prior to the execution of an entry into the new notes. With such conversion prices ranging from $0.62 to $ concludes my prepared remarks. I'll now turn the call back to Claudia. Claudia? Claudia Goldfarb Thank you, Brendon. I'll focus on our three key strategies executing cost savings and cash conservation initiatives, expanding candy distribution and pursuing new category opportunities where our team has deep we continue to carefully manage operating expenses to drive meaningful savings while maintaining our commitment to production, innovation and quality. In the first quarter, we reduced overhead by approximately $400,000 through targeted cuts related to our Mexico operations and labor reductions. We are targeting an additional $100,000 in savings during the second also enhancing operational efficiency through smart automation. To support scalable growth without compromising quality, we implemented two custom-designed automated packaging machines. These systems partially replace our previously manual hand packaging process, reducing labor costs and increasing speed and consistency, while being specifically engineered to handle the fragility of our freeze-dried candy and preserve our product we are evaluating opportunities to optimize our manufacturing footprint to better align with our current operational needs. As part of this strategy, we have decided to delay the deployment of freeze dryer 7 through 12 and until production demand warrant their approach allows us to maintain maximum flexibility as we explore new category and geographic expansion opportunities. Similarly, given our current priorities and the need for greater visibility into long-term demand, we have postponed the activation of our two candy making to conserve cash and strengthen our balance sheet on March 31, 2025, we revised the annual compensation for me and our Executive Chairman. Approximately 28% and 32% of our respective annual cash salaries will now be paid in company stock pursuant to the Sow Good 2024 stock incentive plan rather than we've taken steps to bolster our short-term cash position by entering into exchange agreements with existing noteholders to push out upcoming maturities by five years incorporating certain conversion and redemption features. These agreements reflect the strong confidence our management team and noteholders have in our recovery plan, long-term strategy and future to sales expansion. Q1 marked a period of meaningful reengagement and growing momentum through targeted retail promotions and key account wins. Albertsons grocery launched approximately 1,500 displays as part of their summer set with Halloween shipments also scheduled for late May. Kroger received seasonal Easter items, continuing our presence in key seasonal hardware stores saw 50 locations order full displays in Q1 and with steady category expansion and encouraging early performance. Orgill mirrored our progress at ACE with positive initial demand and continued orders supporting our entry into the hardware retail channels. KeHE one of the largest US distributors will officially launch Sow Good in May through its new brand program. Winn-Dixie received initial shipments in Q1 and has already placed reorders indicating a positive consumer Below launched our Chamoy and Cotton candy taffy in Q1 and thanks to both new product introductions and renewed velocity due to targeted retail promotions across our existing SKUs, we saw a 124% increase in orders compared to to the strong performance, they've now added our Caramel Crunch SKU, which will launch in June. Although we paused the launch of our in-house the chew candy production we have successfully advanced with in-house production of our Caramel products in both traditional and freeze-dried are handcrafted using a limited selection of high-quality ingredients, completely free from dyes, artificial colors and artificial flavors. This initiative reflects our commitment to meeting the evolving expectations of today's consumers, who are increasingly seeking clean label better for you alternatives without sacrificing demand for transparency, simplicity and ingredient integrity continues to shape purchasing decisions across the confectionery category. By prioritizing cleaner formulations, we are not only differentiating our brand but also positioning ourselves to lead within this growing see this shift as a long-term opportunity to build trust, strengthen brand loyalty and future-proof our product portfolio in a competitive and evolving marketplace. Looking ahead, we are excited to continue innovating with cleaner ingredients while expanding our assortment, ensuring Sow Good remains synonymous with quality, transparency and we're excited to share that we launched our products in the Middle East during the first week of May through our partnership with explorer investments, a leading distributor in the Middle it's still early, initial orders exceeded expectations, and we anticipate having clear visibility into performance by early July. This expansion represents a significant growth opportunity. The Middle East freeze-dried market is still in its infancy with limited competition from high-quality brands and ample space for our market leader to Europe, while we've not yet launched as we continue to navigate regulatory requirements, we were optimistic about the long-term potential of the market. Our strong reception at ISM Germany earlier this year reaffirmed growing interest in premium freeze-dried products within this emerging and relatively untapped will continue to pursue opportunities to open this market, and we'll keep you updated as progress is made. Given the volatility of the emerging freeze-dried candy category, our management team has remained focused on identifying opportunities to further leverage our manufacturing expertise and proprietary freeze-drying a result, we are planning to enter two high potential categories where we have deep expertise, beef jerky and freeze-fried yogurt snacks. Both product extensions will emphasize clean label, better for you ingredients, aligning with consumer demand for simple, high-quality formulations and supporting our long-term commitment to health conscious innovation. As previously shared, initial samples were met with very positive feedback from customers reinforcing our confidence in these on that early enthusiasm, we've advanced R&D and remain on track to potentially launch both categories in the second half of the year. Currently, we're planning for yogurt melts to debut under the Sow Good brand, while beef jerky will launch under a new brand currently in energized by the growth potential these new categories represent and encouraged by the strong early response. We look forward to keeping you updated as these initiatives progress. We're executing on multiple fronts, expanding domestically with new retail partnerships strengthening our distributor network and entering high-growth international a good pipeline and continued emphasis on innovation, quality and cost discipline, we are confident in our ability to deliver sustainable long-term growth. While visibility into our revenue path is improving, it remains dynamic as is typical in emerging product previously shared, we expect Q2 to show modest improvement over Q1 as new partnerships begin to take hold. These early steps are laying the foundation for more meaningful growth in the second half of the remain focused on building a scalable, sustainable business with disciplined cost management in a fast-moving environment. While challenges still persist, we believe we're positioning ourselves to emerge stronger, more agile and ready to reassert our leadership through continued manufacturing excellence, innovation and thoughtful category we'll now open the call for Q&A. Operator (Operator Instructions)George Kelly, Roth Capital. George Kelly Hey everyone, thanks for taking my questions. Maybe one for you, Claudia, just to start. You talked about in your prepared remarks seeing renewed consumer enthusiasm. So I guess the question is, could you share what you're seeing just in weekly or monthly how has that trended maybe over the last, I don't know, six weeks or longer. And then secondarily, how is your retail inventory position right now? Are you still kind of working through excess retail inventory with certain of your large partners? Claudia Goldfarb George. Yeah. No, great questions. So what we're seeing is a slow increase in sell-through data in retailers. We were kind of at about 12, 13 units per door. Over the last few weeks, we've increased to 14. This past week, we increased to 16 units per just like our revenue recovery, which has been slow and steady, we're seeing that same kind of trend in retail environments. What we're hearing is that customers were really excited about the large CPG launches, and they wanted to try them. As they've tried them, the novelty has worn off, and they're returning to our brand because of our superior assortment and the quality of our week over week, we're starting to see that improvement in Circana data. I'll give you a great anecdote. Five Below, when we did the cotton candy, it was supposed to be a one and done order, was a limited edition run and it performed so well that they just placed a reorder for an additional 46,000 bags. And we're seeing that throughout retailers, ACE, Orgill where it was just going to be limited displays are now placing reorders for additional displays. So that's what we're seeing on the retailer regards to retailer excess inventory, Five Below was working through quite a bit of inventory. That has slowly gone away. We did some very targeted promotions at Five Below at HEB to get rid of the excess inventory. Those were successful, and so we're now returning to a normal reorder cadence with those we're excited. There are still challenges, we're still working through reopening doors, but in our existing retailers with our existing customers, we're seeing a return to normal reorder cadences and excitement for the brand, especially our relaunches and I'm probably giving you more information than you want, but like the Caramel Crunch going into Five Below and other retailers, our innovation, our new product launches are being accepted incredibly I think that part of that is, a, they trust us as one of the pioneers in the category. So what we're coming out with these new products, they understand that it's coming in with a really quality freeze-drying process. And we're really focused on cleaner ingredients, which is also being received incredibly well. Like our Caramel Crunch, it's got six ingredients completely free of artificial dyes and flavors. And I do think that, that is going to be a really strong important component of our go-forward strategy. George Kelly That's all helpful information. And a few questions left for you. How many doors are you in currently? Claudia Goldfarb So that is changing, especially right now. We just did the Winn-Dixie launch. We did -- we're increasing in Orgill and ACE. So that's a very dynamic number. But -- George Kelly Maybe at quarter end would be the better question? Claudia Goldfarb Yeah. So somewhere around 1,900, somewhere between 1,900 and 2,000 doors. George Kelly Okay. And then a separate topic. Your inventory grew again sequentially. And so A, how do you feel about the quality of that inventory? Is any of it heat affected or just generally thoughts there? And then what are your expectations for the next couple of quarters? How quickly can you work inventory down. Claudia Goldfarb So in regards to heat-affected inventory, that's really contained to two SKUs, the sweet worms and some of the peach perfect, I feel like we've identified and gotten rid of most of that inventory, there might be some stragglers here and there. In regards to the quality of the inventory or the salability of the inventory that we have remaining, we've got a two year shelf life on most of our products. So we've got time to work through of the things that we're trying to be really strategic about is like the sweet worms, the peach perfect that we want to work through at a quicker cadence looking for opportunities that we can do that overseas and focusing on new inventory that we bring in being those better for you ingredients, cleaner ingredients and kind of restocking with those product that's where we are on inventory. It's going to take us a little bit of time to work through specifically the sweet worms, some of the peach product and those things, but we're actively working on it. George Kelly Okay. And then one last question for me is just about the competitive dynamics. Has any of the big guys that entered the space, do you feel that they're committed? Have you seen them pull back at any retailers? Or is the industry perhaps just not big enough for them to kind of stay interested? Or anything you've observed there? And then also, the smaller competitors that have been around for longer, have you seen any of those exit the space? And that's all I had. Thank you. Claudia Goldfarb No, thank you. Yeah, a lot of the small guys have exited the space. None of them were real competitors. And we've seen a huge inundation of the China product in especially like discount retailers and some of kind of the lower price point retailers, which has affected trial quite a I think that consumers are smart, they're savvy and they're recognizing that the reason there's so much key product in some of those retailers is because it's cheap product. And they're returning to Five Below, an HEB and these other places and purchasing good quality regards to some of the larger -- sorry, one of the other smaller retailers that we've been kind of neck and neck, not retailers, brands that we've been neck and neck with. Looking through the Circana data, they've been affected by the large CPG companies entering the space, much more so than we have, and they aren't seeing the recovery that we again, I think that, that speaks to our assortment, our quality, the fact that we actually freeze dry our products ourselves as you may remember, we were co-manufacturing overseas last year. As of late last year, we no longer do that. Everything is now once again in our Irvine you see that quality really speaking, coming through our product line. In regards to the large CPGs, I haven't heard anything from them or from retailers. Based on what I'm hearing from buyers, consumers and what I'm seeing in the data, I'm surprised that they're not performing better. I would have expected a stronger performance from we're seeing what we would consider some pretty substantial declines in their sell-through rate. And again, I think that, that has to do with the fact that who you choose to freeze dry your product really matters. How you freeze dry, how you package really so I don't know if they're going to evaluate who their co-manufacturers are, I don't know if they're happy with what their performance is. But I think that there is definitely room for improvement on the quality of the product that's out there by some of those larger CPG companies. George Kelly Thanks. Operator (Operator Instructions)[Igor Novyartsev, Lairs Capital]. Igor Novyartsev Hello and thank you for taking my question. And I think a couple of questions already been answered. So I'm happy to hear that. One of the questions, I remember, Claudia, you mentioned that on the previous call that the Q1 will not be materially better in terms of sales of we could say that it was materially better. So revenue has recovered somewhat by more than a $1 million. So was there a lot of sales right after the call? Did you ship a lot of product after the -- at the very end of March. So I'm just curious if something has changed in that respect. Claudia Goldfarb Igor, hi, great question. And yes, we saw much quicker recovery right after that call. And so reiterating what I said to George and on this call, A lot of consumers were really excited about trying some of the new launches on the market. And as those trials kind of happened, they said, you know what we're going back to Sow Good because we love their assortment, we love their quality. And we saw that in the last half of that quarter. And we're seeing that this is still going to be slow. We recovered a little bit more than we anticipated in the first quarter. Second quarter is still going to be marginally better than the first quarter. Third quarter is still going to be marginally better than the second, but it's we're excited to see it happening. And right now, we're incredibly focused on how do we sustain that momentum through targeted partnerships with our strong retailers and with really thoughtful, methodical product launches that are speaking to consumers and what they're looking for at this time. Igor Novyartsev Okay, thank you. My other question is, I think it's fair to say that you have six units and you have a significant spare capacity until your sales recover. What are your plans for the spare capacity can it be utilized in doing some private label or subletting it to somebody? Or what are your thoughts on that? Claudia Goldfarb Yeah. No, definitely. I hate having our machines idle. We want them to be operating, we want to keep our workforce at full force and so we're analyzing and looking for opportunities in all of the areas you just mentioned, home manufacturing, private labeling, we're excited about bringing yogurt melts into our product assortment both on the branded side and a private label side because, again, that's something that will help keep the machines fully utilized. And so nothing is off the table in regards to how to bring our utilization rates back up. Igor Novyartsev My final question, and I know it's sort of a difficult question. So obviously, your cash position has improved somewhat by converting some of the compensation into equity and I'm happy to see that given the circumstances, but it's still a little bit tenuous. Do you have any discussion to improve your cash position? What are your thoughts for the next couple of quarters? What are you planning to do? Claudia Goldfarb Yeah, definitely. As a management team, cash is an important conversation that we're having on a very regular basis. And converting some of our salaries from cash to stock, talking to our noteholders to push those notes we're going to keep evaluating every strategy we can on how to improve our cash position. What our primary focus at this time is, A, being really thoughtful and methodical about evaluating what our expenses are and converting our inventory to cash because that is the easiest way for us to improve our cash have plenty of inventory sitting in our warehouse that we need to work through and convert to cash because that's going to be the most meaningful way for us to improve the cash position. Igor Novyartsev Okay. Thank you so much, and I'm glad to see some green shoots in this quarter. So hopefully, we will see more green shoots in next quarter. So that's all the questions I have. Thank you, Claudia. Claudia Goldfarb Thank you. And I'm looking forward for more green as well. Everyone, thank you very much. I greatly appreciate you being on this call and being on this journey with us. We still have challenges ahead, but we're excited as we see our recovery strategy is taking hold. So have a great day, everyone, and again much appreciated. Operator Ladies and gentlemen, this concludes today's teleconference. You may disconnect your lines at this time for your participation. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
06-05-2025
- Business
- Yahoo
Q1 2025 TG Therapeutics Inc Earnings Call
Jenna Bosco; Senior Vice President - Corporate Communications; TG Therapeutics Inc Michael Weiss; Chairman of the Board, President, Chief Executive Officer; TG Therapeutics Inc Adam Waldman; Chief Commercialization Officer; TG Therapeutics Inc Sean Power; Chief Financial Officer, Treasurer, Corporate Secretary; TG Therapeutics Inc Tara Bancroft; Analyst; TD Cowen Michael DiFiore; Analyst; Evercore ISI Roger Song; Analyst; Jefferies Mayank Mamtani; Analyst; B. Riley Securities Prakhar Agrawal; Analyst; Cantor Fitzgerald Operator Greetings and welcome to TG Therapeutics first quarter conference call and webcast. (Operator Instructions) As a reminder, this conference is being is now my pleasure to introduce your host Jenna Bosco, Chief Communications Officer. Thank you. You may begin. Jenna Bosco Thank you. Welcome, everyone, and thanks for joining us this morning. I'm Jenna Bosco, and with me today to discuss the first quarter 2025 financial results are Michael Weiss, our Chairman and Chief Executive Officer; Adam Waldman, our Chief Commercialization Officer; and Sean Power, our Chief Financial our Safe Harbor Statement, Mike will provide an overview of our recent corporate developments. Adam will share an update on our commercialization efforts and Sean will give a summary of our financial results before turning the call over to the operator to begin the Q&A we begin, I'd like to remind everyone that we will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements about our anticipated future operating and financial performance, including sales performance, projected milestones, revenue guidance, development plans and expectations for our marketed cautions that these forward-looking statements are subject to risks that may cause our actual results to differ materially from those indicated. Factors that may affect TG Therapeutics' operations include various risk factors that can be found in our SEC addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any later date. We specifically disclaim any obligation to update or revise any forward-looking statements. This conference call is being recorded for rebroadcast on TG's website at where it will be available for the next 30 I'd like to turn the call over to Mike Weiss, our CEO. Michael Weiss Thanks, Jenna, and good morning, everybody, and thanks for joining us on today's call. It's a pleasure to be here with you and to provide an update on TG's continued progress, both in the successful launch of BRIUMVI and in building a company committed to improving the lives of those living with multiple sclerosis.I'm excited to share that we kicked off 2025 with another strong quarter of performance, underscoring the sustained momentum behind BRIUMVI. As you may have seen in the press release this morning, BRIUMVI US net sales reached nearly $120 million in the first quarter, once again exceeding our growth reflects both the increasing adoption by health care providers and a rising tide of patient interest and confidence in BRIUMVI. Over the past month, I spent a significant amount of time in the field, meeting with prescribers and it's energizing to see firsthand of BRIUMVI's becoming the go-to anti-CD20 therapy for many of what's even more gratifying is hearing directly from people living with MS. At a recent MS walk, I spoke with two individuals who shared their experiences switching to BRIUMVI from another approved IV anti-CD20 therapy. They both described how they previously felt unwell for days or more after each infusion but not with stories echo findings from a recent paper in Frontiers in Immunology which highlighted seven case reports of people with MS who switched to BRIUMVI from a prior anti-CD20 due to issues like tolerability, disease activity, wearing off effects or incomplete B-cell each case, the unwanted effect either resolved or did not recur with BRIUMVI. These real-world experiences support the idea that not all CD20s are the same, and that switching within the class may make a point is reinforced by another recent publication in CNS drugs, which explores how structural and mechanistic differences among CD20 therapies may drive variations in efficacy and tolerability. Word of mouth within the MS community is powerful, and we believe these success stories are helping to drive continued growth and I often say, more people who start BRIUMVI, the more people will start BRIUMVI. And even in a highly competitive market, our team and BRIUMVI's unique profile are rising to the challenge, I couldn't be more proud of how our team has executed our multiphase launch strategy and the strong start we've made in 2025 as we pursue our long-term goal of making BRIUMVI the number one prescribed anti-CD20 as measured by dynamic market a moment, Adam Waldman, our Chief Commercialization Officer, will walk you through the commercial performance in more detail. As well as our investment priorities and updated guidance for Q2 and full year 2025. But first, I'd like to highlight our pipeline and efforts to enhance the BRIUMVI core focus of our innovation strategy is simplifying the patient experience. Our enhanced clinical trial is designed to help us evaluate a number of these strategies and has already yielded some encouraging previously presented the data from this study, demonstrating the safety and tolerability of a 30-minute maintenance infusion as well as initiating BRIUMVI treatment with a single full dose 450-milligram fusion for patients switching from another CD20 who had low B-cell most recently at AAN last month, we shared new data showing the safety and tolerability of starting all patients on BRIUMVI with a single 600-milligram dose on day one effectively eliminating the need for a day 15 dose. Feedback on this streamlined approach has been very believe patients will appreciate the simplicity of starting treatment with just one infusion visit, making BRIUMVI a true twice-a-year therapy from day one. We are now preparing to advance this regimen into its registration directed exciting initiative is the development of a self-administered subcu BRIUMVI. While the vast majority of patients continue to prefer to receive their anti-CD20 as an IV infusion, there is a growing minority we're now choosing a self-administered subcutaneous option of which there is only one available today. We see a clear opportunity to expand access and choice with a self-administered subcu ongoing Phase 1 safety and bioclobin study is showing promising results. The subcu injection appears to be well tolerated with bioavailability that appears to support every other month or even potentially quarterly dosing. We're pleased with the progress so far and are on track to launch a pivotal trial this also believe the subcu formulation may open new doors for us in new indications. One area that we are currently exploring is the potential for subcu BRIUMVI and myasthenia gravis, and we're evaluating potential additional indications as on the pipeline front, we continue to be excited about azer-cel, our allogeneic CD19 CAR-T cell therapy. It's early days for CAR-Ts and autoimmune diseases, but we see great potential across multiple indications. We are excited to launch our Phase 1 for azer-cel in progressive forms of MS a segment of the MS population with limited treatment options and poor closing, 2025 is off to a very strong start. We're executing on our commercial strategy, advancing our clinical programs after expanding our manufacturing capacity to meet the growing demand. I want to thank the entire TG team for their dedication and hard work is our commitment to our mission that enables us to deliver meaningful progress for individuals with relapsing forms of now I'll turn the call over to Adam Waldman, our Chief Commercialization Officer. Adam, go ahead. Adam Waldman Thanks, Mike, and good morning, everyone. I'm excited to share the details of another strong quarter of commercial execution, delivering meaningful growth and further validating our belief in the long-term potential of BRIUMVI in the RMS net sales for BRIUMVI in the first quarter of 2025 were approximately $119.7 million, exceeding our internal expectations and reflecting a strong start to the year with 137% year over year growth and 16% sequential quarter over quarter growth. Based on this performance and the strength of leading indicators, we are increasing our full year 2025 BRIUMVI US net revenue guidance, which I will detail at the end of my continue to see strength across our key performance drivers. The first three months of the year marked our highest months of total new patient enrollments since launch, a clear indication that demand continues to accelerate. This is despite the headwinds typically seen in the first quarter and an ongoing competitive product launch. Importantly, March was also our highest month ever for repeat prescribers with physicians coming back to prescribe BRIUMVI again, a strong signal of growing prescriber confidence and we saw continued strength in the hospital setting, which contributed approximately 60% of enrollments in March, the highest percent to date, highlighting our deepening footprint among institutional discontinued growth for the first time repeat prescriptions have now surpassed new prescriptions, a key inflection point in BRIUMVI's life cycle demonstrating strong persistence trends at week 24 and week 48. While we remain in a competitive marketplace, BRIUMVI continues to stand out. Our five year data, consistent real-world safety and efficacy profile combined with our unique one hour twice-a-year infusion, remain highly compelling to both physicians and we are seeing both an expansion of the CD20 market overall and continued dynamic market share gains for BRIUMVI and the anti-CD20 IV segment, driven by both newly diagnosed patient starts and an increasing volume of switch from my point of view, the field team has executed with excellence. We've deepened our reach among high-volume infusion centers, community neurologists and leading academic institutions, and we continue to receive positive feedback on our team from our we look ahead to the remainder of 2025, we are focused on several key growth drivers. First, continuing to accelerate uptake among community neurologists, academic and broader practice types. Second, we will be launching our first ever direct-to-patient BRIUMVI television commercial campaign, including full digital surround sound strategy, to educate, inspire and activate eligible patients to seek out BRIUMVI treatment. Third, our teams will continue to build and leverage a real-world evidence to support BRIUMVI's position as a differentiated and trusted anti-CD20 fourth, we will start preparing for life cycle innovations, including our subcutaneous formulation, which we believe represents a significant long-term growth opportunity. In summary, we are off to a strong start in Q1 results reflect growing demand, increasing prescriber confidence, growing patient awareness and broad commercial execution. Looking ahead, we are optimistic about the continued growth and potential of BRIUMVI. As I mentioned, based on current trends in both new patient accumulations and persistence, we are raising our full year 2025 US net revenue guidance for $525 million, which we highlighted at JPMorgan in January to $560 million for the full year Q2 was already off to a strong start with April being another record month for enrollments into our hub. And while we are still early into the quarter, we're currently targeting $135 million for the second a robust foundation in place, multiple catalysts on the horizon and a highly differentiated product, we believe BRIUMVI is well positioned to become a market-leading therapy in RMS. I want to thank our commercial team for their tireless commitment to drive. Your work is making a meaningful impact on the lives of people living with MS. We're proud of the momentum we've built, and I'm more excited than ever about what lies with that, I'll turn the call over to Sean to walk through our financials. Sean? Sean Power Thank you, Adam, and good morning, everyone. Earlier this morning, we reported our detailed first quarter 2025 financial results in a press release, which is available on the investors and media section of our website.I'd like to start today with a quick overview of our first quarter revenue, something Adam and Mike both already touched on briefly. We're very pleased to report US net product revenue of $119.7 million for the first quarter of reflects 137% growth compared to the same period last year and a 16% increase over the fourth quarter of 2024. This continued momentum underscores the strong demand that we're seeing for to operating expenses. Excluding noncash items, our total OpEx for the quarter, which includes both R&D and SG&A expenses came in at approximately $82 million for the quarter. That's tracking slightly ahead of our full year guidance of approximately $300 million. This increase during the quarter was primarily driven by about $20 million in manufacturing investments for subcutaneous expect these costs charged to R&D to fluctuate from quarter to quarter. But importantly, we remain confident in our full year OpEx guidance of approximately $300 million. On the bottom line, thanks to the continued strong performance of BRIUMVI, we reported GAAP net income of approximately $5 million or $0.03 per diluted share for the quarter ended March 31, finally, a quick note on our balance sheet. We closed the quarter with $276 million in cash, cash equivalents and investment securities. We believe this puts us in a strong financial position to continue executing our commercial strategy, advancing our pipeline and supporting our operations for the foreseeable concluding, I'd like to offer some initial perspectives on the recent discussions regarding potential tariffs. As you may know, BRIUMVI is currently manufactured in South Korea. Given our relatively low cost of goods, we do not anticipate that the currently proposed tariffs will have a material impact on our gross margins or overall financial performance. Nonetheless, we are actively monitoring developments and evaluating all of our that, I will now turn the call over to the conference operator to begin the Q&A. Operator (Operator Instructions)Tara Bancroft, TD Cowen. Tara Bancroft Hi, good morning, and thanks for taking the question. So I was hoping maybe you could provide a little bit more color on competitive dynamics, especially with Ocrevus de novo? And like what are you seeing with new patient share there. I asked because Roche had a small but meaningful miss this quarter. So I'm wondering what you're hearing, if anything, on preferred uptake of BRIUMVI in new patients versus other treatments. Thanks so much. Michael Weiss Adam, do you want to go ahead and take that one? Adam Waldman Yeah, sure. I think, as I mentioned in my comments, Tara, that we saw the highest three months ever on patient enrollments. We saw a really strong month in April. So we believe we'll continue to drive market share gains. We sat back at JPMorgan, we think we're getting about 25% of the IV assume that's up from there, and we continue to see good traction in the marketplace. So we're really encouraged by what we're seeing. On the question on de novo, but what we can tell, we've seen zero impact on BRIUMVI. Tara Bancroft Great. Thank you so much. Michael Weiss Thank you. Operator Michael DiFiore, Evercore ISI. Michael DiFiore Hey guys, hope all is well. Thanks for taking my question. Just two for me. Just any update on gross to net trends this quarter, a figure in how the Part D redesign that may have affected this. And any comments on how this may affect gross net for the balance of the also with regards to gross margin, when can we expect you to fully deplete, I guess, the prelaunch reserves in gross margin? And perhaps when could we expect maybe kind of a decrease there. Thank you. Michael Weiss Adam, let's take the GTM and maybe, Sean, on the gross margin? Adam Waldman Sure. On the gross to net question, no material change in gross to net in the quarter. Part D redesign is not really relevant for our drug, which we look like Part B drugs. Sean? Sean Power Yeah, sure. Thanks, Mike. So we fully depleted that pretty that pre-commercial inventory reserve that you're seeking at. So the margins you're seeing this quarter and going forward to be the fully big number and consistent quarter to quarter. Michael DiFiore Thanks. Michael Weiss Thanks, Michael. Operator Roger Song, Jefferies. Roger Song Great. Congrats for the quarter and then thank you for taking our questions. So maybe the question related to the subcu of BRIUMVI, you said you will start pivotal this year. So just curious what is current thinking about how many doses you will move forward and then when we will start to see the PK data second half. Thank you. Michael Weiss Sure. Thanks, Roger. Yeah, I mean we're still leaning toward having two dosing regimens in there. So the every other month and the quarterly as part of the pivotal. Obviously got a little time to make a final decision, but that's definitely where we're leaning in terms of PK data coming out probably later this year, you just haven't been focused and we continue to collect more data. So I think we're continuing to work on that study. It's going to lead us right into the trial, and then we'll figure out when we present some of the data. But again, I think we're being super conservative in having to dosing regimens in the pivotal trial, if we do that. And if we don't do that, it's because we're so confident in one or the other. Roger Song Thank you. Michael Weiss Thanks, Roger. Operator Mayank Mamtani, B. Riley Securities. Mayank Mamtani Yes, good morning. Thanks for taking our questions and congrats on the quarter. On the 30-minute infusion data that also we saw at AAN an update, Mike, could you touch on the physician feedback there? And also, how might your data be tracking in depleting -- depleted and non-depleted patients as you obviously try to understand the switch profile in ENHANCE broadly about your Phase 3 trial, scale and scope. If you could comment on that, that would be helpful. Michael Weiss Sure. So with respect to the 30-minute infusion, the feedback has been positive. Actually, maybe, Adam, you've talked to a lot of folks about that as well. Maybe you want to touch on the 30-minute infusion, any thoughts there? Adam Waldman Yeah. I think there's been very positive feedback on the 30-minute infusion. Physicians think it's a convenience for their busy infusion centers. Patients think it's a much more convenient option. And the data so far is showing that it's well tolerated. So it's been a very positive and physicians have encouraged us to continue to develop. Michael Weiss Thanks, Adam. Yeah. So -- sorry, did I cut you off, Mayank? Mayank Mamtani No, no, go ahead. You were going to comment on Phase 3. And my question, the second part was actually around the R&D spend also, which seems like it's tracking higher yes, if you could factor in the Phase 3 comments there that would stand this year, for example? And then also, as you thought kind of commented on the SG&A spend, for second half, given the DTC spend commitment if you could comment on how you're thinking about profitability going forward? Michael Weiss Yeah, Mayank, you've got a lot in there. So I'll try to take it in a few steps, and you can follow up if you like. But the -- just in terms of the pivotal program, so I'll just be clear, there's two pivotal programs that we're is for the combined day 1 and day 15 dose, that study again should simplify the onboarding of patients. So we're looking at the 600-milligram dose on day 1 and day 15, and that study should start hopefully in the next one, two, three months a little that's ongoing 30-minute infusion is probably something we're going to look at getting going later in the year or early next year. There's a little more logistics involved in that program than the 600 terms of the R&D spend that Sean mentioned, again, I think the only delta is just the materials that we have to produce to make the subcu that hit the R&D line instead of the CMC manufacturing line. So I think in terms of our overall R&D spend, we're right on target to what we thought would in terms of profitability, I'll let Sean discuss two or three things you can add. But I don't think we're highly focused on profitability this year. And I think in terms of the way we view the world, we're not using cash, we should be driving cash through the I don't think we're prepared to start targeting profitability and earnings per share on an ongoing basis. I think we'll stick to revenue guidance for now and some OpEx guidance that we do have plans to not use cash during the course of the year, that's for sure. Is there something else I missed in there, Mayank, you had a few points. Mayank Mamtani You discovered it all. Thank you, Mike. And lastly, on -- I have to ask a traffic question. How far along is your North Carolina plant in being able to produce commercial scale manufacturing, if you could just update on that. And thanks for taking my questions. Michael Weiss Yeah, you got it. Yeah. So moving manufacturing is not an easy task. And so I think we've said only several years before we'd be able to manufacture out of that North Carolina facility. So for the moment, I don't think it's a near-term event. It will take several years, I know the group is he's working processes to get there, including potentially even starting out in Europe to perfect it while they're actually working on the facility it's a long-term process. It was never really meant that all occurred as everyone may remember before any of this tariff talk. It was not a design program for avoiding tariffs. Or is it a design program to have backup manufacturing. So we're working on it as quickly as we can. But again, as Sean mentioned, I don't think we feel that we're going to be impacted too much from any of the tariff stuff. I don't know what the final outcome is. Mayank Mamtani Understood. Thank you, Mike. Operator Eric Joseph, JP Morgan. Hi guys. This is Ron on for Eric. Congrats on the quarter. And just wanted to ask, I believe you previously cited expectations with about 20% product adherence between biannual infusions. Do you have a sense of that matter in Q1 and any anticipated fluctuations going forward? Thanks. Michael Weiss Sure. Adam, you want to grab that one? Adam Waldman Yeah, sure. Can you just clarify the question? I didn't care the first you said -- did you -- what was the percentage you said? 70% adherence between biannual infusions. Adam Waldman Yeah. I don't remember saying that. But what I would say is the persistence trends, as I said in my remarks, remain very much very positive and persistence remains strong and above our expectations. Michael Weiss Thank you, guys. Operator Prakhar Agrawal, Cantor Fitzgerald. Prakhar Agrawal Hi, thank you for taking my questions and congrats on the quarter. So firstly, on subcu BRIUMVI, when is the phase pivotal trial expected to start. I think previously, you had mentioned targeting midyear 2025 as the time line. Is that still on track?And secondly, a question on BRIUMVI outside of MS, what do you need to see for BRIUMVI's profile and indications like myasthenia gravis to make the decision to invest further, especially given you have some income interesting data from the CD19 drugs in this space, especially Amgens. Michael Weiss Yeah. Thanks, Prakhar. So in terms of subcu, yeah, still on track, as we said in the prepared remarks, still on track with the subcu timelines. And in terms of MG data. Yeah, I mean, we're definitely moving cautiously forward in that been speaking to lots of KOLs, I will keep you here in the data, we'll get a chance to see how the CD19 is received in the marketplace. So I think we're not prepared to go diving into the pool just yet, but we've got more than a toe in, and we'll continue to evaluate.I don't think it's one piece of information. I think there's an aggregate of information. And I don't think most of that information is necessarily related to our drug and the performance of our drug. I think it's more related to the marketplace and how things evolve. So we are going to stay on top of it, we're going to keep pushing forward. in a moderate basis were an ability to accelerate at any moment, we feel the time is right. Prakhar Agrawal Got it. And maybe just one last question. What percentage of BRIUMVI patients right now are switches from Ocrevus? And is this a trend that you're seeing more of an inflection this year? And if so, why is that the case? Michael Weiss Adam, you want to go ahead? Adam Waldman Yeah. We haven't seen -- I wouldn't say we've seen material changes in the percent of which is we still see a healthy amount of switches from Ocrevus. And that trend has stayed consistent since launch. So no material change, and I'm sorry, I don't remember the second part of the question. (multiple speakers) Prakhar Agrawal Okay, thanks. Operator At this time, I would like to turn the floor back over to Mr. Weiss for closing comments. Michael Weiss Great. Thank you, operator, and everyone, thanks for joining us. As you can see, we're off to a very strong start in 2025. And we're looking forward to keeping that momentum positive going forward into the rest of the got a number of key objectives that we're still looking to achieve and we discussed on today's call, of course, meeting our revenue targets that we've set, commencing pivotal trials for a simplified starting dose for IV BRIUMVI and for subcu BRIUMVI as well as executing on our Phase 1 trials for BRIUMVI patients with myasthenia gravis and for azer-cel patients with progressive forms of that, we continue to evaluate opportunities to expand our portfolio of product opportunities across autoimmune and autoinflammatory diseases and we'll continue our share buyback closing, I want to extend a heartfelt thank you to all the individuals living with MS and health care providers to place their trust in TG and BRIUMVI. It their courage that inspires everything that we do here at TG. So we really do appreciate it. And again, thanks, everyone, for joining us today and have a nice day. Operator Ladies and gentlemen, this concludes today's event. You may disconnect your lines or log off the webcast at this time, and enjoy the rest of your day.
Cision Canada
24-04-2025
- Business
- Cision Canada
Drilling permit and other updates Français
TORONTO, April 24, 2025 /CNW/ - CUPANI Metals Corporation (" CUPANI" or the " Company") (CSE: CUPA) updates shareholders regarding several developments. Our exploration program, including geophysics, fieldwork, trenching, and drilling has been approved under Quebec's ATI program. Prior to permitting Cupani presented its plans to the Naskapi Nation in late February. Permits are valid until April 2027. The company has staked additional exploration claims adjacent to its Doublet zone. These new additional blocks are shown above in blue. As result of this staking, the most southernly point of the claims block is now the Doublet zone. The new total count of exploration claim blocks will be 1069. Cupani is pleased to announce that our long-time consultant Mike Muggridge, (PEGNL) has committed further to the corporation by accepting the role of Vice President of Exploration. Mike has already led both the May 2024 exploration campaign as well as the February 2025 logistics campaign. His experience with critical minerals began with Cu-Pb-Zn exploration for majors in 1989, then working as geologist at Voisey's Bay from 1995 until 2001. Mike's experience with mine operations includes 16 years with Iron Ore Company of Canada, and 3 years as Superintendent and Mine Manager during restart of the Scully open pit mine. His role with Cupani focuses on design and execution of the 2025 exploration season. In conjunction with personnel changes in recent weeks, the Company has issued incentive options to officers and directors for the first time since July 2022. Cupani announces that it has granted a total of 5,100,000 stock options (the "Options") to its directors, officers and consultants pursuant to the Omnibus Long-Term Incentive Plan of the Company (the "Plan"). The Options, subject to the terms of the Plan, are exercisable at a price of $0.17 per common share of the Company for a period of 5 years. About CUPANI CUPANI Metals Corp. provides shareholders with long-term capital growth exposure by investing in mineral exploration properties and other assets. The Company is listed on the CSE under the symbol "CUPA". To learn more about the Company please visit Forward-Looking Information Forward-Looking Statement (Safe Harbor Statement): This press release contains forward-looking statements within the meaning of applicable securities laws. The use of any of the words "anticipate", "plan", "continue", "expect", "estimate", "objective", "may", "will", "project", "should", "predict", "potential" and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company cannot give any assurance that they will prove correct. Since forward-looking statements address future events and conditions, they involve inherent assumptions, risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of assumptions, factors and risks, many of which are beyond the Company's ability to control or predict. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to, conditions in the equity financing markets, stock market volatility, unquantifiable risks related to government actions and interventions, the termination of any agreement, changes in laws or permitting requirements, failure to obtain necessary regulatory approvals as well as those risks identified in the Company's annual Management Discussion & Analysis. Management has provided the above summary of risks and assumptions related to forward-looking statements in this press release in order to provide readers with a more comprehensive perspective on the Company's future operations. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive from them. These forward-looking statements are made as of the date of this press release, and, other than as required by applicable securities laws, the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise.
