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BE Bloom Energy

Participants
Mark Mesler VP of Finance & IR
KR Sridhar Co-Founder, President, Chairman & CEO
Randy Furr Executive VP & CFO
David Katter Baird
Michael Weinstein Credit Suisse
Paul Coster JPMorgan
Stephen Byrd Morgan Stanley
Tahira Afzal KeyBanc
Colin Rusch Oppenheimer
Shereen Undavia Raymond James
Julien Dumoulin-Smith Bank of America
Call transcript
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Operator

Good afternoon, and welcome to the Bloom Energy First Quarter 2019 Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to Mark Mesler, Vice President of Finance and Investor Relations of Bloom Energy. Please go ahead.

Mark Mesler

Thank you. on First us Conference XXXX joining Call. for Bloom Quarter Energy's Earnings Thanks conference posted well we Relations supplement periodically call, To this call. this have information we QX shareholder reference throughout financial website XXXX to letter supplemental as as that will our Investor our matters be include discussing The forward-looking events future regarding we the future the company. will and financial today statements performance of the in most risks that detail subject to reports important statements to and the contained uncertainties those SEC, we identify with are the materially differ XX-K specifically our in could forms forward-looking discuss recent documents on results which and statements. filed These that from in cause XX-Q actual factors risk no obligation revise assume statements to made forward-looking We call. any on today's

in to of as QX we reconciliation principles. These our letter, between in not measures. financial accounting and and GAAP included XXXX non-GAAP financial with non-GAAP shareholder refer part measures non-GAAP are A our letter. GAAP accordance QX prepared XXXX this shareholder During accepted and generally call, is

on the will call will over the Furr, and Randy turn K.R. Executive are K.R. Chief then the and KR highlights to today Sridhar, I the and Co-founder Financial financial of Randy and Principal will Officer; operating Officer. and take review questions. quarter we Chief call me now Joining

KR Sridhar

our XXXX KR, accomplishments Hello. XXXX QX me and call. conference you perspectives QX our This performance. and to Allow on is share good afternoon of to and welcome all to financial my

delivered international of across and acceptances are another markets. quarter diversity strong industry pleased record We to with have a sectors

year-over-year results more QX sectors. life the diversification utility tech, and center care, new that FY higher retroactive QX of revenue benefit XX.X% quarter increased and customers the year-over-year. for revenues the acceptances, Removing we sciences achieved and strategy also XXXX, continued QX in million in FY estimates. increase last momentum Our health XXX a recognized We of in ITC impact sectors in the we data core we achieved our Overall with discussed our delivered and midpoint in onetime 'XX $XXX.X XX% of than XXXX. retail slightly of the

we competitive During value progress our our a proposition advantage. strengthening in strong and made enhancing further of and QX, also saw validation

Bloom predictable Energy lower These our have previous of emissions; to and power; As benefits In resiliency I be our about a option power. reduction a strong customers: X programs. at and delivers for focus. key talked to our cost cost reminder, higher length including the more uninterruptible calls, continue lower

propositions: I During resiliency. this value the and X call, will other emissions focus on

an for emissions on with us X our lowered start our profile, to strategy carbon update Let decarbonization solutions. leading

carbon gas natural is Bloom our power and Our the smog-creating of when solution our when Energy Energy solutions date, carbon have avoid They directed pollutants the for reduced decarbonization strategy also securing utility Server all of running multifaceted. from compared water. offer footprint customers reduced customers fed generation to To power X grid. biogas. primary using their Server Currently, consumption is on by to

Some the Apple selected have path. and our IKEA of this including customers, retailer well-known

contaminants power This sulfur, as a meaningful power not able the been the animal that The expectation plant biogas have QX, directed facility In be electricity. by generation generation, our landfill, produced standards, to biomethane method transported into generated via generation efficient, is minimal landfill program. on-site gas the biogas February. lower that We a a located biogas used and biomethane nuclear Bloom more is customer. we electricity to wastewater generation from integrated grid. purified to penetration and and distributed, type and cost cleaning to biomass reliable The solution to biomethane increases. problems. injected on-site is case, spread Servers Server effectively biomethane of and renewable, and it grid it the of process or we those prior readiness addition Then to the biogas with in a the for plant. In transported since X other electrical then local from pilot from to biogas biomethane module biomass a on-site of is stabilize is electricity highly generate directed commercial XXXX. is as Bloom there pilot and gas is Energy demonstrated clean of gas the always-on utilization. panels directly inexpensive relatively before of California a XX-kilowatt January Bloom a is with intermittent produced baseload landfill in our a method commenced and the solar In In deliver Energy answers play our the to We power By treatment technology. at efficient grid conditioning pipe goes and offer siloxanes energetically, from through generate capital to as a to much moisture, on-site the We biomass began utility. by wastes our the it biogas-powered renewable lower highly to biogas, produced Server system million on-site pipeline as believe power will biogas-powered helping cost pipe feeding XXX% has removes role case cleanup electricity from plants increasing into footprint biogas-powered renewables and our electricity alone, using operated to carbon a source to directed has sufficient from biogas on-site. Energy delivered electricity of converted even and the Legacy will has than

biogas this demonstration commercial in to first and expect have We are deployments have future. excited on-site the to delivered

has recent that second of value study A in which alone. is were power Now EIA the duration let than in to topic more U.S. outages the of cost in X,XXX the Blackout X electric past Eaton around in outages outages it with to resiliency power in Estimates in the the by billion. I highlighted the Tracker, extreme the me and interruptions years the in future. move to wanted to weather the discuss, is annual solutions. being an soar increase will duration proposition total our likely seems $XXX systems U.S. U.S. suggest increasing the that utility With economy XXXX main According cause. on cost doubled frequency there that the

else. high-tech With surprise is the Microgrid more and demand no on U.S. a trend. beneficiary America dependent for digital the as projects in solutions economy particular, almost of rise. it Energy come in electricity should on developed past them than more months, Bloom are resilient is ever for this power anywhere surging new that the of XXX its projects, X in with North industry,

independently microgrids sufficient with of Our deployed years. systems the that supply mode. and those specific grid the We more than the in now electrical utility to grid operate of intelligence meet infrastructure past symbiotically or off operate in have site a microgrid in with define This electrical locality. XX% X to demand has the larger XX normal deployed a as been infrastructure an will

duration able when power site is provide of However, to grid always-on larger from locality the and utility for the grid isolate out of utility to any or service the it is time. also

world, we strain in the These to important accelerate utilities During and under power meet customers we power underscore is QX, to role when are resiliency we time elevating them several announced wins how play microgrid post-climate grid unable fast-growing the our in for customers. demand. help and change a

tell you X me about Let customers.

The outages separate the Our headquarters power impacted problems. outages grid solve Networks at experienced the microgrid X and XXXX. are deployment of Extreme describes engineering we Jose how in San IT aptly to reliability Extreme offices customers of critical helping summer functions. its

deployed grid will uninterrupted fails. a Bloom to Extreme if the Server microgrid an to supply Thereafter, electricity headquarters Energy even its that be provide

win. is cost reducing and cost, reliability, by of XX% that's emissions higher Extreme emissions a its Additionally, reducing lower dioxide and carbon XX%. by Lower electricity triple

has XD-sensing utilities its up timely QX growth New talk are of help about components year illustrates to II-VI Jersey me Warren to another ramped location to needs and its technology. meet at in microgrid we past and remain a in at agile a production facility how The responsive manufacturing in maker, businesses for opportunities can optoelectronics microgrid deployed power when we manner. II-VI. materials engineered the growing meet demand II-VI unable Let

reducing to solution together. the greener work the X also pounds a local enough up is million enabled However, to microgrid emissions to would Bloom seek greater on-site II-VI for an was power supply relative power the reliability months keep growth was The power New growth, selected this X.X-megawatt to per within Jersey by to utility when hit to and from quickly COX have grid. bought year power unable XX electric companies grid-independent II-VI. led it II-VI microgrid system. X II-VI Bloom timely up starting it solution. running of roadblock This the with and a The build growth.

data grid solutions. increases, proliferation for power from demand the anticipate more ever adoption microgrid As from and edge center will demand aging and robust stressed we become EV

our of to Finally, news X team. to to leadership appointments to execute ability am moving business delighted share on our I plan, overall our

team. made Contec Former position, first Hari we reflecting Pillai, to I'm electronics process has is focus veteran, installed Customer executive time. a strategic and Holdings delighted cycle predictable the accomplished us Hari even Vice and is Executive Sanmina the extremely as our This have has reducing President industry the to joined while he the CEO, more President and and our time Group. scalable this make Installations joined an overseeing logistics dedicated appointment

and Wilkerson successor Sonja for it made incredibly right Barber, find Executive a has our this Energy quarter. People passing Energy, mark to the previous President welcome Bloom Chief and as Chief year. on Bloom Vice sudden Officer, David Officer us an to last indelible also We People following been important

we record With that us. you, retaining Over invite and continued Randy developing through you Furr, the an fit QX Financial I commitment impressive appointment to right perspective, HP at and talent XXXX. estimates operating cultural QX our she is Her and to walk to for leadership incredible recruiting, talent HR Chief our to our an for results is as like for to would Randy. Officer, Sonja track continue Cisco, Infinera, reflects grow. and with our

Randy Furr

my be referring that KR. comments, call slides presentation earnings to Throughout referred to in Mark I'll the Thanks, prepared earlier. the

Note stock-based I reference numbers compensation. exclude First will some highlights. all that profit that

million, the Slide up respectable of $XXX.X at 'XX's So XXXX come XX%. from were very Revenue systems, into adjustment a summary, that was systems. X. ITC In when Acceptances Non-GAAP up flowed year. from XX% onetime approximately last on margin QX excluding gross XXX retroactive XX% XXX in quarter. QX to

profit quarter ended short-term PPA and excludes non-GAAP investments with $X.X $X.XX adjusted $XXX.X million. we of and of slight of Our coming this EBITDA income Adjusted loss a at a $X.X a of cash the EPS in operating was million and was in loss million million $XX cash. with

the QX's X, revenue for QX Slide onto the by color to basis, we Now Bloom, acceptances line a $XXX.X in some for translated seasonally revenue, both on $XXX.X decline to down X% a in from being saw records XXX QX million. Referring quarter. million sequential with historically

However, year-over-year million] [$XX.X revenue was year-over-year. if of by retroactive up revenue on that a up $XX.X by in 'XX, revenue the to 'XX's XX.X% Onto from reported (sic) QX related was basis, you XX% QX XXXX exclude that Slide million and X. billion onetime ITC $XXX.X was included approximately

given the price was of we year-over-year selling QX basis, benefit to $X.X and have $X,XXX depending the international revenue QX. XXX% were will acceptances retroactive lower expecting million line this compensation, $XX.X to ITC or was where installation year. profit the seasonality. our that ASP. from in due Gross $XX.X once at 'XX's upon estimates not received onetime million in $XX.X QX do increased expectations average in generally million in excluding Once coming line mix 'XX again the ASP from This again we kilowatt. our the per On Our with with million QX QX stock-based ASPs down in gross 'XX, to in profit, included the in a was vary excluding volume over of

price as has shareholder with estimates. of As a estimates quarterly installed provided letter, sales as public, QX total going of QX and you cost been our estimates, system in we specific range well our we do provide a process since range average

For ASPs QX TISC came the line 'XX, those with estimates. in, both and in

the delta between and However, as midpoint our estimate of the quarter. estimated the or which on and of margin emphasized, equipment I've per of the a during key represents yielded margin kilowatt. TISC The the ASP delta previously real $X,XXX on $X,XXX metric is installation acceptances X,

on a see Slide margin our delta can number kilowatt, actual was with the As but you X, per better in generally midpoint our line estimate. $X,XXX of

stock-based of seasonal and 'XX's The expectations. $XX.X loss, loss down was As acceptances million income This to volume from increased QX's again profitability profit, decline in The number loss Slide you operating volume our compensation non-GAAP year-over-year line investments reflecting activities. Again, can again with excludes operating quarter-to-quarter see for XX.X% this a expense take on but the mix typical substantial a a and income operating is million general QX $X.X in from $X.X in from of ITC is X, $X.X QX improvement 'XX demand QX, the by million. QX and QX the million benefit. in to out R&D increase. driven adjusted retroactive operating income was improvement onetime number generation

Our EPS million and come loss at Nonoperating in expenses $X.X for were come at plan adjusted adjusted in $X.XX. quarter. EBITDA the a of per

cash. This short-term on sheet PPA $XX Slide We the with ended of X. investments. to and million Turning the million quarter $XXX.X cash of includes balance

cash we favorable a up we $XX.X for cash quarter. million. XX The expectations days flow, generally our actual with of Days less offset sales was capital short-term as essentially operating flow XX Slide $X million by operations So excluding cash, from days working in QX our from PPA million quarter-over-quarter with Referencing come of the X. to Free investments. was non-GAAP quarter-over-quarter. flat in as expenditures, $XXX.X $X.X capital loss capital define net The result balance volume when million This approximate a of cash was the days. with receivable additions sales lower increase accounts changes. line of and in ended factoring which is negative

system was up to QX, days outstanding was expect conversation days on we of to down days normal cycle inventory our in acceptances variations. XX outlook. XX and payable from days QX X QX by days X Changing In XXX Also, to business the and Our operating days be and total $X,XXX kilowatt. between be million and to between be and $XX.X between be million. per cost $X,XXX XXX; we per installed to and ASPs kilowatt; $XX.X expenses $X,XXX to $X,XXX our between expect to

delta trend The the I both important mentioned delta in our the site site whether applicable comment location in number the include international between work includes the does profit. install ASP two. not grid by business of and the include outage see a As to past, expect location, TISC our for tariffs are we TISC factors and bottom impacted the the $X the and approximately the utility of represents larger per the our line the of mission-critical; is or This to and lower and site includes a installation, generally being cost onetime our and/or is final the protection is mentioned, generally the or not basis; not scope installed, One the of on installation. ASP outlook. the as kilowatt the whether size previously the In million of installation, nonproduct benefit element trend QX, profitability. but a on

I your our majority field-replaceable our solutions time, thank the surrounding to for innovative again, and the you call back Q&A. some from the units for Once now profitability. will operator service impacting With coming favorably turn

Operator

comes Your from first David Katter with question [Operator Baird. Instructions]

David Katter

to -- like the be a Can little and it kind dynamics the wanted some for I of start is little midpoint of you guide customers mix about just of down might the looks the next bit talk there? So a your quarter. down margin upfront bit sequentially. of on It

Randy Furr

down be quarter-over-quarter. We question, margin Good David. really expect to don't necessarily Yes.

in the in mix we think margin reason we felt think the general bit I just good of be had we like we QX I even half that business stress about continuing business we're we we not have QX first about well. to that upside year have. of last this at just no of business if at the half as that can't of want work and mix guided to a And of you overdelivered had quarter. the -- going the year. beginning some and that second that of in to was midpoint quarter, And was year, our the as as the look through to the we there's Obviously, $X,XXX in $X,XXX,

So we expect down. be to it don't

a maybe flat, wanted essentially set. up be to slightly we but it bit, expectations some in to we provide expect that the room We

David Katter

on shifting in second kind Understood. point backlog color agreement on half. just then the business of business you helpful. the what And provide and kind the bit you of gears and the margin made backlog That's additional opportunity maybe kind the the last the you're in of of the of Korea, seeing a to there. Can there? And trends little in sort

Randy Furr

Korea diversify wins in KR Korea. -- as pointed continue to locations includes we not domestic is to in that we've be that We grow Look, international obviously for business, our had some expect we've other we'll as has and quarter, expectation strong just business here. business that internationally. but last reported as out And our us well in and that business, the

All year. a of had into that We XXXX. was certainly not shipped backlog in going this

We that continue this booked, want that. and just expect of in -- business. to throughout year have kind continue to Korea to grow The it you and book to business we Anything to at add? I'll leave

KR Sridhar

you think that. answered I No,

not we So changing are guidance. our

I of making see and think what international. points trend guidance expect today, the And between we on key that's and expect have we as you to that to track in U.S. given here sit no we terms mix changes. is he's

Operator

Weinstein Michael Your next Credit question Suisse. with comes from

Michael Weinstein

a half. maybe Can you -- -- status. the half be on And little X.X a how than Gen first stronger guess an little why bit about topic on talk then also second that factors of this same the I update just will

KR Sridhar

Yes.

what mix to is, entering non-mission-critical, the install, things business into are, the fairly the bookings, what depending process our is all much that in all complexity affect utility where a quarter on whether the have to TISC different our based visibility you deltas have we install, what think we the particular these various that new things mission-critical, ultimately they the quarters, those we good All affect know are gave size how and territory, months. Randy whether on the installation geography reasons where Korea the and we we is X the the on because affect a of for we I the the understand of see where of bookings and you and So depending stated have we rates are. ASP XX we slotted through

first for So see it will we we that knew in segments, at have the what we and second domestic in terms And good basis of better in market of visibility we growth, that formed the mix the in we in lighter will between margin margin. be the into into of terms half terms year, Coming the it. terms half see is be international. growth and where see the where of and geographies of what the

that we but call, provided that half first that we're We the to that what I XXs put have during have the in and the we're fairly we're last was our it telling second you reason already and that tracking the in the at this expect expect stated growth plan point. we margin the just clearly in to color be And to half. you be and up tracking to lighter

Randy Furr

I couldn't to X.X? microphone, I understand sorry, but a And me. about little think you a that hear discussion asked on the little closer also I you moved

KR Sridhar

Yes.

track. on is X.X So

didn't first ignore time. that mean the I Sorry, to

and automation process, on me. point, is And the as that speak. it's you X.X the And design design we on reminding for we thanks tell is So at through is this It process track. all track. can yes, going

Michael Weinstein

full in question, of -- that. production? kind be some can up frame time just of And when Maybe you think can an last one and provide kind or on ramp you service then estimate full to you will it maybe

Randy Furr

of certainly current to everything production of very We'll clearly a market. some we the time the that. want fourth Obviously, have the We Yes, line deplete additional product out current in the good calls of generation and the shipments over X.X time. product. in is quarter for with ramp inventory It's all year. next the

X-quarter a at ramp X will a and of more probably be it transition So kind like to -- least up.

can end by up XXXX. the you kind expect of with So that the full said, ramp of

Operator

comes Paul next Your JPMorgan. with from question Coster

Paul Coster

sense potentially Can you numbers, know bookings little bit the and talk a us but of don't I of bookings of us helpful. impacts would plan curtail any the California you to pipeline? the a on customers in gives the is anything pipeline. momentum kind million having to interested that in share I'm particularly X be And about your electricity whether health PG&E to

KR Sridhar

very good question. a Paul, that's

So a significant a And expect point. reliable said that people service service are pretty of with opposed in feel And always-on customer this. gut I where events and they take as do we business last even territory solution. does a relatively can control. Fundamentally get between the continuous out would to a power you about you to reported better your the customer, Clearly and of that kind and breaks We acquiring contract see out that peak we a that for long when utility cycle. a customer week, microgrid the exist outage figuring to I how swath of territory. to give know, start providing X cycle the beyond Street as it an Wall solution because, days safe in to translate Journal that we once came think would they reports potentially is a of definitely their to the

the However, is uncertainty ratepayer is and clarity going going what to bear to or and the exists whether that be it going on going to the today all how is there is economics, is burden taxpayer is no the to state not or on it or still do the passed what investor do. mean to the

shelves. going stores tell all to where a make I Immediately, We like there decision do suddenly in can the solutions product fundamentals favoring consumer the that, what customers going need consumables the out our is then things their see you unlike hurricane, grocery the are shake off next. those they're for So to to if on corporate be to Bloom. a

do. You turnaround kind quick a we for that expect what don't of

Paul Coster

any bookings potential to have Anything is stuff outside to the opportunities moment? growth follow-up momentum going site we India, some then at you my share -- question this are countries? And When regarding see coming business those been Japan, from can U.K. previously.

Randy Furr

on once that is tend add would again, pretty do consistent that One backlog, to the not the lumpy. the the a on often Look, update here I've the that international we I backlog orders installation. business, year, stayed be will thing we have

you the contrast If to installation, domestic have do revenue. that have bookings kind between where the acceptance the of the business and time could that the we we or the recognition of

for planning, Given that do, range. all to to all all time, occurred have that, and in that time we it by design the lead the the permit systems. already the to systems, international, place order business that build tends When book all time XX-month to down do be to the it they just X- that's us that we upfront effort it's takes the has

actually we've So and in ship book often, comes we're we think that quarter, you'll certainly, will see in where same order the it the it's international if even we and one where in the quarter. of been and quarter has most early the booked possible, in had I shipped business, enough next the quarter this, have

will the it business. input domestic that hopefully, want different or comes profile when and international bookings that time part... So stress a is or same acceptance -- actual take I the But the there just to shipment between to versus

KR Sridhar

in particular. international the address on Paul, as me couple, markets, and you And them a identified let

And and now India is the But are, talked large create lead lot gas interesting it of come momentum lot in said gas think of to up to really companies will that of I in in the players. you, going has city a I'll the where groundwork market Oil some to to a the gas terms of tell where facility India. opportunities Part other but down things India a companies the and biogas for positive just are the you opened of Indian Corporation located. doing of other recently Chennai are IT the We a have I not and few line. authority they very to

nature robust we action So there's right direction any think are again, very are familiar in the have are that completed. election business not but India the entry you to market any trends fast In will are don't to People action decisions. until we pointing the a terms of be short term, that of growth. that be And market. India in a know going I That make the a there. we building, in very and pipeline the with impending -- slow then is

We are aware that. of

for figured are think I putting regulatory be point, Brexit from policy wait-and-see. think is don't We At in prepared it's it. a energy a people our until this I and that. will out, U.K., perspective, a

Operator

Your next question with comes from Stephen Byrd Morgan Stanley.

Stephen Byrd

to really very obviously operationally prove technical to more you the like you've biogas? Company. just I approach? to prepared your you work very feel the understood wanted that you'd that this into biogas development. about done in I results. Southern make perspective, like like -- from positive essentially imply near encouraging bit you using Would with ties operationally sounds just a product a the I time couple It further India, seems wanted to And a I sure development, that have to start it a operational need but think it's more future deploying Or out do be broad.

KR Sridhar

more big be operate fact from way that's Steve, in than particulates, a other is the were long prototype way, amenable for to out time. that and field clean be particulates for unpleasant Definitely, surprises. a from -- there it it were I has deal. harmful negative we SOx, with expect which the very absence a is out, operated have in carbon that, a working if make methane that fully things NOx, to X go energy the and doesn't means it systems were there client have on the a up XXx operate conventional the mean that SOx, this not that our That good Even no if went By a atmosphere no question. that market it going in lab purified gas footprint. not that into it is it's systems Southern it our the into COX NOx, method, in purified that, that just which to we required and real demonstrated a a to we and to of our surprises it's greenhouse levels the go perspective that for used the the way to in What to put to is molecule. because And pipeline. felt been the a a carbon, Company adds all the technology, the carbon

what -- later about systems year. potentially are go of This to with the year customers, our into and generation. pilot be able quarters and customers, to and it we pilot we tell of one next we and in expect expect the to customers backlog are have and we is to out a signing up this, this few pilot will about take closed expect you go best those solutions with we starting now we So proven this customers, Having and done. to into be next on-site there customers funnel

Stephen Byrd

relatively level purchases, follow-on a great shift cycle you're I of it, to sort large That's think to high-level little customers. have extremely I'm moved your helpful. purchases with but terms cycle large customers. to customers? At call existing Obviously, high trends curious, are there success any from in of that I of existing with large some to converting over a respect that small very Randy a with bit, to touched move customers into just you to wanted the very your from, on seeing I'll that just small this

KR Sridhar

is that typically trends And clearly. the noteworthy. than rule, to brand-new very with larger see average. of something customers. we a repeat that transaction That shorter a is orders repeat is couple a than tend a order. repeat are But that orders it those time also customer with than to are a cycle The on time as to transaction first become first order single the cycle There be purchase the customer

scale existing with us. focus on from focus So much a But the as getting who perspective, perspective, signed heavily up. from we initial on, a repeatability perspective volume customers on we and numbers customers

Operator

with Your Tahira next from comes question KeyBanc. Afzal

Tahira Afzal

installed on K.R., are for guys first that question seems you're acceptance your is meeting in rate. track the as back me it base predicting you

the year to put year, more there any and you plan? you this other next into the of into up in cleared think see As back are half need growth initiatives

KR Sridhar

we're I and we very addition by looking building existed putting are team for now adding half think ramp in leadership dedicated we that it. people, getting before second the ready a strong more to and but team the are to really in

that trend. feel steps to all to like sit we up necessary adequate we As are we be to the here, able step taking

Tahira Afzal

in breakeven more territory? And back a maybe Randy. be positive of Randy, flow we quarter last and free see second to of may Any free we positive cash one when move the got could question cash flow line sight glimmer for up year.

Randy Furr

if more we And in the loss to look contribution roughly -- news from guidance, in Obviously, $X favorable the Look, We that where certainly lot good continue cash we $X million we're into the expenditures. expect million million less lost we pretty million, than had expecting future. QX. midpoint free working capital, capital $X something QX. -- Yes. a which or tracking is I We favorable million, our $X flow to well $X it roughly had of our sense. had roughly is in at makes we you

So coming the expected positive. flow with obviously, we we flow this quarter, then go half second cash expect that to cash could to QX. year, see think free profits the And we of free that in neutral

there. So I think I'll stop

your answers that question. think I

Operator

from question Oppenheimer. Colin next with Rusch Your comes

Colin Rusch

could guidance. acceptances replacements how and revenue guidance, many delta material the are you And many the XQ stack builds. Guys, a break are there? new between and XQ Is there the revenue down how and

Randy Furr

No.

what say you mean though, you by replacements, do that? when stock So

Colin Rusch

replacing I then stack and existing mean the installation. you're the if

Randy Furr

yes. Yes,

managed that replaceable an There's And to or reported shift look P&L, service. end to you we reported P&L field, acceptances, the service customer get. part letter, it's our new if up again, we have product, we through that the shareholder in included they or So that when for service as sell a at financials financed the in offset we that's stuff services equipment, there our on our expense of and leasing revenue in and by new either that's that these is which revenue out the transactions. units refer that installations all our as to we the CapEx either PPA field directly as front isn't the in

the systems, the stuff the service, that the revenue providing when we of guidance a field new replaceable expense the deteriorate to anything that's point out and efficiency. that all back the as So midpoint that and part new we of ship we're a FRUs, all out there QX, for units, guidance is field or we're up shipping that of do that ends in XX% the to it, we the systems about call

So hopefully question. that answers your

Operator

from next Undavia Your question comes James. with Shereen Raymond

Shereen Undavia

the regarding battery a solution the storage to in these been microgrid Are Bloom essentially systems storage. display core has So of with opportunity. I the aiming Traditionally, had you microgrid the question Servers?

KR Sridhar

without the the operating. never because and gives of operate able microgrid battery be days, put So in a without never with amount real months microgrid definition of storage storage and of and operating. storage A minutes for grid in to would should grid place. the in operates you operation single a that weeks And battery you hours microgrid

that the distinction. is So

the power a uninterruptible So can battery. of service the with done availability be UPS,

no service. needs battery. a supply how the It So out can on to of for the by any matter is combination is truly all that by provide we predetermined which customer the means, grid this been replacement adequate meet demands technologies no of the to stay long have is, with that generation a

available. run that was needing large as So for time commercial without did for such a customers, a not other in past, than could the diesel potentially for interruption a large few days at the customers, fuel exist as genset long supply industrial solution

from the because don't our no in know grid transition to need for they've already Here, going goes There systems even out is when operation. on. been from idle

So the not out and most X coupled our depend and these which independent one fail each power of customers only highly, is same unlikely. gas the understand different on the are at if of that getting is other the of highly both that a electric grid power the it's of systems are to time, grid ways reliable infrastructures that

have. the our offering That's is of customers it. our can and It's the best a So love microgrid. definition solution this one of unique customer a always-on

Operator

final will America. from Bank Your question from come Dumoulin-Smith of Julien

Unidentified Analyst

[Eric] actually is This for on Julien.

on safe upon, touch follow-up any particularly step question one intention down updates the So to harbor into as that. we And first just to pursue an ITC foremost, fuel are and for XXXX. subs after wanted there the ITC

Randy Furr

projects And that goes started the will where from even use down way we've works, down commence ITC construction XX%, we have to occur it construction. even the will X for all to that as that, the was the into the with opportunity In that step years. to step XX% we we good Look, the for with XX% it on the even was start extended the forward. identified -- go and future, same continue

saying ITC we've been talks in new change the as that looking year X Washington even consistent we the really been in year already from even into pretty going there's rules extends possibly well -- old X to for the operating future. have So today into And at of in we're as some maybe and this these rules that is under with us the forward.

that's question, or hopefully What's ITC. a [Eric]? on follow-up good the second the the So

Unidentified Analyst

on ITC. was to expansion, the question second just sorry, but touch on The

through wondering mainly value would say, wondering... you or boxes to X% haven't the extend nuance. That's you procure whatnot, of any what that ahead fair identified. market I'm ITC allow expected I'm just projects of understand that I to, the So 'XX, is for year-end plan steel there such as

Randy Furr

we plans when get year. we'll nearer and in But more about yes. is the have talk this we the Obviously, that end place of answer

Unidentified Analyst

it. Got Okay.

sure. far then different last quarter? upfront the first Primarily something are on with half? talked know with geographical discuss margin I particularly expansion that's lastly first make identified mix. the how so to you depending the Is Could Northeast with wanted on you Just expansions driving you call heavily about the being the And that into guys Northeast. been progressing pretty

Randy Furr

Yes.

savings So that industrial probably XX the about are that give of operate charged better margin to answer or today why? rates the to and think that savings we It's is states yes. the lets their with takes Bloom states, the -- some of customers achieve it to utility highest are in where rate targeted the transact And being the is business. the tariff customer our in way or U.S. commercial a because Look, a that us hurdle XX

customers, we or as every in lets us enter utility the costs and that operate. more come the that Even California, utility charge C&I you very down single Bloom is doesn't other in areas. California that tariff know, state the the more our rates in As that like of significantly, state of in states these mean the

and However, moving into move over other as come our down, costs states as regions well time to territories forward. able those we'd as be

So Coast. can Back the clearly, even just East differ. we're so in Again, we're from utility and not our land strategy, approach to within really it's the today. expand which customers, with the and even on on that which West depending our focus East Northeast we tariff Margins comment within differ portfolio or can a Coast Coast operating that differ on not It margins can Coast to West upon in. uncommon.

some when Coast, we of some East an lower the a rates, hurdle. look give in target one very high Coast, in it's that the We order that customers tariff both the in will our common West some have on approach most at some in portfolio book blended very, fact, In customers the they from ones. this both to sites utility all

from mix that's from [Eric]. within headed with with obviously, really be And depending region the could that time period. to we're earlier that comment, So that, that there us are region for upon where to acceptances time accepted

Operator

call. conference today's concludes This

now disconnect. may You