American Superconductor Corporation

Good morning and welcome to the AMSC fourth quarter fiscal 2024 financial results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one. Please note, this event is being recorded. I would now like to turn the conference over to Nicole Golas, AMSC's Director of Communications. Please go ahead.

Thank you, MJ. Good morning, everyone, and welcome to American Superconductor Corporation's fourth quarter and full fiscal year 2024 conference call. I am Nicole Gólez, AMSC's Director of Communications. Joining me today are Daniel McGann, Chairman, President, and Chief Executive Officer, and John Kasiba, senior vice president, chief financial officer, and treasurer. Yesterday, after market closed, American Superconductor issued its earnings release for the fourth quarter and full fiscal year 2024. A copy is available on the investor's page of the company's website at www.amsc.com. Remarks that management may make during today's call about future expectations, including expectations regarding the company's financial results, plans, and prospects constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including those set forth in the risk factor section of our annual report on Form 10-K for the year ended March 31, 2025, which the company filed with the Securities and Exchange Commission on May 21, 2025, and the company's other reports filed with the SEC, which are also available on our website. The company disclaims any obligation to update these forward-looking statements. Also, on today's call, management will refer to non-GAAP net income, a non-GAAP financial measure. Tables of reconciliation of GAAP to adjusted financial measures can be found in the company's earnings release. With that, I will now turn the call over to Chairman, President, and Chief Executive Officer, Daniel McGann. Daniel?

Thanks, Nicole. Good morning, everyone, and thank you for joining us. We're really excited to share some great news about the company and not only where we are, but where we're headed. I'll begin today by providing an update and sharing a few remarks on our business. John Kasiba will then provide a detailed review of our financial results for the fourth quarter and full fiscal year 2024. He will also provide guidance for the first quarter of fiscal 2025, which will end June 30, 2025. And following our remarks, we'll open up the line to questions from our analysts. AMSE delivered its strongest reported performance in years for both the quarter and for the fiscal year. During our fourth quarter, we outperformed expectations across nearly every key metric. We saw revenue grow sequentially quarter over quarter, and by nearly 60%, against the year-ago period as we reached a recent record level of revenue surpassing the $65 million mark. Our grid business revenue grew substantially by more than 60 percent over the year-ago quarter, while our wind business revenue increased significantly by more than 40 percent for the same period. We achieved our third consecutive quarter of GAAP profitability, our seventh consecutive quarter of non-GAAP profitability, as well as our seventh consecutive quarter of generating operating cash flow. We believe this record quarterly revenue and continued profitability reflect the strong momentum we've built and the discipline behind our success. For the full fiscal year, I'm proud to say that it was a year of exceptional execution and strong growth across our business. We saw total revenue grow over 50% to $222 million. We saw revenue diversity across renewables, industrials, military, utility, and the semiconductor sector. Over a third of our sales were for renewable projects, Manufacturing and traditional energy projects represented also nearly a third. Military was about 15%, and utility came in just over 10%. A significant part of our strong performance was driven by our core business, where we achieved nearly 20% organic growth for the fiscal year. Nearly 70% of our revenue came from the United States markets. We see this as a very important hedge against the changing American trade policy and tariff landscape. We ended the year with over $85 million in cash. Let's now take a look at our order bookings for the quarter, which were extremely strong. Fourth quarter orders grew to $75 million. We are seeing a significant acceleration in our business driven by semiconductors as well as traditional energy projects. We booked nearly $320 million of new orders for fiscal 2024. We closed the year with a robust 12 month backlog of over $200 million. This was $140 million a year ago. The business has expanded and orders appear to be accelerating, albeit we are now booking some products for delivery already in fiscal 2026. We successfully expanded into allied navies for the first time with an order from the Royal Canadian Navy marking a key milestone in our global defense business strategy. Additionally, we successfully delivered three ship protection systems for the U.S. Navy. These accomplishments highlight the growing demand for our solutions as well as our position as a trusted partner domestically and abroad. We expanded our product portfolio through an acquisition, positioning us to capitalize on opportunities in both the military and industrial sectors. In our wind business, we showed year-over-year growth as INOX's business prospects strengthened, and our three-megawatt ECS demonstrated its capabilities. We believe all parts of the business are now aligned and poised to deliver improvement. Now I'll turn the call over to John Cassiba to review our financial results for the fourth quarter and full fiscal year 2024 and provide guidance for the first quarter of fiscal 2025, which will end June 30, 2025. John.

Thanks, Daniel, and good morning, everyone. Total revenues for the fourth quarter of fiscal 2024 were $66.7 million. This is an increase of 59% compared to the year-ago quarter of $42 million. Grid business revenues of $55.6 million increased by 62% versus the year-ago quarter. while our wind business revenues of $11.1 million increased by 42% versus the year-ago quarter. Moving on to the full fiscal year, our total revenue in fiscal 2024 were $222.8 million. This is an increase of 53% compared to fiscal year 2023 revenues of $145.6 million. Grid business revenues of $187.2 million increased 53% in fiscal 2024 and represented 84% of total revenue. The year-over-year increase is a result of organic growth within our new energy product lines accompanied by the addition of NWL. Wind business revenues of $35.6 million increased 51% in fiscal 2024 and represented 16% of total revenue. The year-over-year increase is a result of increased ECS shipments to INOX for our 2-megawatt and 3-megawatt class ECS systems. Gross margin for the fourth quarter of fiscal 2024 was 27%, compared to 25% in the year-ago quarter. For the full fiscal year 2024, AMSE generated gross margins of 28%, This was up from 24 percent in fiscal 2023. We saw a full-year gross margin expansion of 353 basis points over the prior year. Now, moving on to operating expenses, research and development and SG&A expenses for the fourth quarter of fiscal 2024 totaled $15.6 million. This was up from $10.3 million in the year-ago quarter. Approximately 17 percent of R&D and SG&A expenses in the fourth quarter were non-cash. For the full fiscal year, research and development and SG&A expenses totaled $54.5 million in fiscal 2024, compared with $39.6 million in fiscal 2023. Approximately 14 percent of R&D and SG&A expenses in fiscal 2024 were non-cash. Our net income in the fourth quarter of fiscal 2024 was $1.2 million or $0.03 per share compared to a $1.6 million loss or $0.05 per share in the year-ago quarter. Our non-GAAP net income for the fourth quarter of fiscal 2024 was $4.8 million or $0.13 per share compared with non-GAAP net income of $1.9 million or $0.06 per share in the year-ago quarter. For the full fiscal year 2024, our net income was $6 million or $0.16 per share. This compared to a net loss of $11.1 million or $0.37 per share in fiscal 2023. For the full fiscal year 2024, our non-GAAP net income was $24 million or $0.65 per share. This compares to non-GAAP net income of $600,000 or two cents per share in fiscal 2023. We ended fiscal year 2024 with $85.4 million in cash, cash equivalents, and restricted cash. In the fourth quarter of fiscal 2024, we generated $6.3 million in operating cash flow. For the full fiscal year, we generated operating cash flow of $28.3 million. Now, turning to our financial guidance for the first quarter of fiscal 2025, we expect that our revenues will be in the range of $64 to $68 million. Our net income on that revenue is expected to exceed $1 million or $0.03 per share, and our non-GAAP net income is expected to exceed $4 million or $0.10 per share. With that, I'll turn the call back over to Daniel.

Thanks, John. It really is a different business now. AMSE delivered a terrific year of operational performance, an outcome that reflects our efforts to build a more resilient company. I think this is the first time we're guiding to net income, and we're talking about strong revenue and non-GAF net income as well. We've cultivated growing relationships with our customers across multiple projects that have increased in size, scope, and technical complexity. Today, we're delivering greater volumes to repeat customers. We believe our diverse bookings, strong balance sheet, and operational success in fiscal 2024 have set the stage for long-term improvement in the business. Over the past three years, we've managed well through a sharp increase in revenue. Back in fiscal 2017, our annual revenue was under $50 million. That was annually, not quarterly. By 2021, we had doubled that, and by 2024, we doubled it again. Our quarterly revenues now exceed that annual level from fiscal year 2017. We delivered operating leverage without requiring major capital investment. The business really is in the strongest position in over a decade, and we believe it's still getting better. We enter fiscal 2025 confident in our ability to continue building a more resilient and profitable company. We are guiding to another quarter of expected high revenue levels for our first quarter of fiscal 2025. Again, seeing this $65 million revenue level as possible, the guidance range always depends on customer timing of milestones on many of our projects. It's certainly nice to be talking about $65 million when we were talking about 30 million per quarter only two years ago. With that, let's turn our focus to fiscal 2025, starting with the growing opportunities in our power solutions. Demand for reliable power is rising. Defense priorities dictate a stronger Navy. We see demand for our power quality products across the evolving energy landscape where reliability and performance become more critical than ever. The grid is under pressure. Distributed energy and two-way power flows are adding complexity. The need for smarter, more resilient, and dynamic systems is only increasing. Data centers alone could double global power demand by as early as 2026. Semiconductor fabs in the United States are projected to more than triple by 2032. We've seen a ramp up in our orders pipeline this quarter, securing multiple orders driven by semiconductor fabs under construction. These orders as well as orders from traditional power customers are the main reason that we see such a dramatic increase in our order intake rate. Traditional power production is also making a resurgence, driving industrial growth and grid strain. The U.S. is reshoring advanced manufacturing in many factories where resilient power supply is critical. Our aging infrastructure just can't keep up. Last month, the administration issued an executive order to strengthen grid reliability and security. The Department of Energy is now authorized to use all available power resources to ensure reliable electricity delivery. That's where we come in. Our power solutions, capacitor banks, harmonic filters, and static synchronous compensators are built for energy-intensive industries like artificial intelligence, data centers, steel, and a variety of metals, automotive, chemicals, and semiconductors. Our products are designed to maintain reliability, maximize output, and enhance power quality in distribution networks impacted by industrial loads. We are uniquely positioned to enable industrials to power facilities in ways that scale without adding complexity or size. In fiscal 2024, we expanded our offerings with power supplies and military grade solutions that strengthen our overall product portfolio. These solutions help industries cut emissions, power critical systems, and boost the performance of their plant, as well as powering critical military systems. In each case, these are critical power solutions that need to operate in harsh environments. We have orders and backlog generated from the demand across industrial, utility, and military sectors, where these products are making a significant impact. We're not just responding to grid changes, we're enabling them. We're focused on capturing the many opportunities ahead in both power and defense. We see growth from wind in India. We design and supply electrical control systems, or ECS. They make wind turbines more competitive and efficient. In fiscal 2024, we secured nearly $35 million in orders for our 2-megawatt and 3-megawatt ECS from INOX, as they ramp up to service their growing demand. About half of these shipments occurred during the year. Our proprietary technology is helping INAC scale, supporting what they've called their strongest backlog in recent memory, with over three gigawatts of orders. Let's now turn to our growing presence in the Navy sector. Our Ship Protection Systems, or SPS, helped naval vessels by reducing their visibility to enemy threats. This year marked a major milestone as we expanded our ship protection systems internationally with a breakthrough contract from the Royal Canadian Navy, our first allied Navy customer. We secured a multi-year, multi-unit contract worth about $75 million with Irving Shipbuilding, the leading builder of Canada's naval fleet. We believe this order represents a strong signal of global demand for our defense systems. We're now preparing to deliver our proprietary solutions to support the US Navy and the Royal Canadian Navy. To date, we've secured five SPS contracts from the US Navy for the San Antonio-class ship. We've delivered on three out of the five systems to the following vessels, the USS Fort Lauderdale, the USS Harrisburg, and the USS Pittsburgh. We anticipate delivering our fourth system soon. We're also actively pursuing opportunities beyond the US platforms, including other allied navies. In summary, our progress reflects a company that is delivering strong, consistent results. As we look ahead, We believe AMSC is in a better position than it's ever been. We've delivered consistent profitability, higher revenue, and increased cash generation. We closed fiscal 2024 with a 12-month backlog of over $200 million and over $85 million in cash, which is critical for supporting larger orders and future growth opportunities. We grew our product portfolio and extended a key solution to an international defense customer. We significantly expanded gross margins year over year. None of these accomplishments would be possible without the incredible dedication of our team. I want to thank each and every one of our team members for truly delivering an outstanding year. We are focused, well capitalized, and committed to creating long-term value for our customers, our partners, as well as our shareholders. We closed a fantastic 2024 and are off to a very good start for fiscal 2025 with tremendous opportunities ahead of us. We are at the center of some of the most important transformations of our time, from defense to industrial growth, from renewable integration to grid modernization. Our solutions are helping power the evolution of a grid that is fit for the future, a more reliable and resilient grid built to support and incorporate a broad mix of energy sources. We believe specifically our American-made products, supported largely by a domestic supply chain and supplied to U.S. customers, which account for 70 to 75 percent of our total revenue, and our expanded exposure to recession-resilient industries positions us strongly against tariff risks and global economic volatility. We are executing on our vision and believe that our creativity can meet today's challenges and help us progress to a better future. This means using future-facing technologies to harmonize the world's desire for decarbonization and clean energy with the need for more reliable, effective, and efficient power delivery. We are committed to powering progress by designing, developing, and deploying power control solutions that harmonize an increasingly complex energy system. Thank you for your continued trust and support. We look forward to sharing our progress with you in the months ahead. MJ, can we now open up the lines for any questions from our analysts?

Certainly. To ask a question, you may press star then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, you may press star then 2. Today's first question comes from Eric Stein with Craig Hallam. Please go ahead.

Hi, Daniel. Hi, John. Good morning. Hey, Eric. Good to hear your voice. Hey, you too. So I do appreciate the commentary on semiconductors, but I'm wondering, you know, for orders, if you could do, I think you've done this in the past, but just an order breakdown, high level for the grid segment in the fourth quarter, and then what is your expectation, again, high level for how that plays out in fiscal 25?

Yeah, so if I look longer term, I'll start there, and then I can think about what the breakout of the orders are. So if you think about the business really kind of as four or five parts, I think where we're headed in the business we're building, it's going to be about 25% materials, including semiconductor. So all of kind of the industrial chemicals and material processing that we've talked about in the past. I think that what we're seeing is in traditional power generation, we have a unique product offering that we're just learning more and more about where that might be applicable. And if we look at where spending is headed, that potentially could drive to as much as 25% of the business as well. I think renewables will continue to be strong for us, particularly in India and in Europe, which is really where we're focused. I think that'll be about 25%. And then the remaining quarter is probably on the order of, say, 15% military, maybe 10% utility. We're seeing some uptick in utility that could even be stronger. So I think we have a very... diverse business. In the past quarter, it was driven by renewables. We have a number of projects not only in India but in Europe where we see demand as well. Industrials was a big part of that as well. Utilities participated. But I think the main accelerating factor, Eric, really was the demand change or inflection in semiconductor that we've been talking to for the past couple of quarters. is now really beginning. So a big uptick in the orders going from about a $60 million run rate to now delivering 75 of new orders really was a large part delivered by semiconductor. We see that continuing. We see that with the potential for future growth. Those projects are under construction. So these are projects that are real, that are funded, that are happening. They've been on the plans of our partners for a number of years. And they've been funded and are going to happen. So they get our equipment kind of late in the cycle. So I'm really excited at the diversity that we have. I'm excited that we're now talking not only about renewable power, but more traditional power. We're discovering that we have a very unique offering that can help the grid fix a lot of different problems for a lot of different industries.

That is great. I appreciate that color. And then you did mention wind, and I believe this was your strongest quarter since I think fiscal 16 maybe in wind. And I know your orders have been quite good or were in fiscal 24. I don't know if you did. I might have missed it. But did you break out wind? I mean, just a percentage of what those were in Q4. And then based on that and based on the backlog of wind that you have, kind of what are your high-level thoughts for fiscal 25?

Yeah, I think there's a couple pieces in there to get at. So the first thing is, you know, what is it? So we've grown from about 8 at the beginning of the year. I think we were 6 the prior year, and now we're above 10, 11. So the business with INOX is driving that ramp. It's really the three megawatts. That we see demand that's greater than what we're delivering today. I think the news I'm trying to make sure that people understand, Eric, is that the demand for what we have is not singularly going to be driven by wind. It's going to be driven by semiconductors. It's going to be driven by traditional power plants. Longer term, we'll see military. Near term, we'll see some things with utilities as well. But I think this is probably the first call. I'm really saying that we have not the potential of a number of tailwinds. We're feeling those tailwinds now. The order book is driving it. The revenue is converting over a variety of these areas. So I think as we look forward with INOX, the one thing to have you understand and have the audience understand is they're a critical partner to us and a great customer. We love working with them. We love the relationship. We try to do the best we can to support them. They're about to go through what we think is going to be another historic ramp up for their company. And we're really proud of what they've done. We're proud of how they've taken what was basically technology and really turned it into profit in the business. They've really done a fantastic job. We have changed the way and the pacing of that part of the business, though. When it was a larger fraction of our business, we wanted to have stability. So we work very closely with INOX to have long-term contracts. Today, we're more working on the short-term because as we see their ramp, we want to be responsive. So the thing that's different about particularly the backlog is There's not a lot of wind backlog in the 12-month number, and that's because we're converting it pretty fast in the revenue, and then we're trying to get the next order and the next order for six months out, nine months out, and continue to do that. So that's something that's different in the business in 2025 than it certainly has been in the past. We'd like to have stability in that business. Today we see it as a stable business. We're trying to be a good partner and being able to provide product as fast as we can. So that's why when you look at the backlog, there's not a significant amount of backlog. I said that the orders in 24 we delivered were about $35 million. We said about half of those were already delivered. So that's a very light backlog relative to what the demand could be from INOX. And that's because we want to be rapidly responsive to them. They are going to go through a ramp, and we want to support that. Did that help with the color on the lead?

No, absolutely helps. And, you know, and I guess just it's a new setup that you're, because it is more kind of order to order and potentially orders in, I don't want to say small orders, but just smaller orders that add up to a bigger number. Those are things that you will not announce.

You know, I think the key really is the pacing and the talk about that, and we'll try to highlight that in the call. I think when you look at the financials getting to the $65 million in revenue and wind is representing, you know, $11 million of that, I guess we're just north of $66. I try to look at it as a threshold. We broke through a certain threshold. They're a great customer, you know, but I don't think it's – I think it doesn't behoove us to overemphasize that because the rest of the business, the growth through GRID has happened, the diversification is happening, and all those pieces are put in place. And that's something that INOX really encourages us to do. We are a much better supplier today, I feel, because of the financial performance of the business, that we can react in ways a bit differently than maybe we could have even a few years ago.

Right. And absolutely, I mean, GRID is the the biggest part of the business by far, but this is the first time in a long, long time that I've heard you say that, you know, the confidence very high that both businesses are working, have tailwinds, et cetera. So, okay, thank you.

Yeah, the whole turn on the quarter thing, I think we've turned it and we're not going to look back.

Okay, thanks a lot.

Thank you. The next question comes from Colin Rush with Oppenheimer. Please go ahead.

Thanks so much, guys. Dan, can you talk a little bit about the effectiveness of the cross-selling efforts that you've got now that you've got a couple of platforms integrated? I know you've asked this repeatedly, but I just want to get a sense of how that's impacting your win rate, order size, and the contribution to the overall bookings at the $75 million level.

Yeah, we're not cross-selling anymore. We're just selling. We're selling the whole portfolio to everybody. We're trying to look at it and what do we have that meets the customer's demands and how do we present that as a full series of features that can be designed as their project. So that's something that the team has really worked on over the past 18 months or so. to get us to the point where we're not thinking, we're not positioning, we're not promoting it as a disparate group of energy control systems. It's one system for a semiconductor fab. So we don't really talk to the customer about, hey, well, this is a DVAR, this comes from NEPC, or this is how it all works. Here's how we mitigate sag, right? Here's how we get the fab to have more uptime. And we have more dynamic and we have more static and persistent capability than we had before we made an improvement. Each of these industries, that's what we're talking more and more about. So, you know, I don't even really see the business really as wind and grid so much anymore. It's a series of control solutions that we try to provide a certain set of customers. And there's a bunch of great industries that are going to drive the growth, not just one, it's many. So it's hard for me to delineate, hey, well, we got a win and we got extra because we have this offering because now, I mean, we're five years into this transformation in the business and now we're really seeing the financial performance as a result of that.

Okay, that's actually super helpful. And then from a margin perspective, as you get a little bit more scale and you've got this common platform that you're selling across multiple applications, can you talk a little bit about opportunities for driving cost reduction on the manufacturing side, you know, supply chain, just either through incremental design adjustments or from just leveraging some of the scale purchasing.

Yeah, I think all those are available to us. It's something that we're working across the company. You know, a lot of the ways the systems are built are very similar. So we're trying to look at learning and efficiency in how we produce, but also how we source. The team really learned a lot that is paying off today with supply chain to be very flexible and to be very dynamic with how do we deal with if supply gets constrained or costs change. So we're trying to do the best we can in managing those costs. And to date, we really haven't seen much that impacts the business. That isn't to say that we won't. That isn't to say that we'll talk to customers about how the world's going to change. I think we've done a very good job of being patient with our costs and passing pricing changes on the customers when it made sense, when the customer could accept it, all those things. And I think that, again, we're going to head through another period of that where there's a chance to reestablish the value with the customer and make sure that we're getting the appropriate value out of it. But we do work on supply chain all the time. I don't have today for you kind of goals or objectives, hey, we're going to take this cost out of that cost out on the product. We really are just trying to drive, you know, more through the factory, get efficiencies in buying and bundling, purchasing as we can, and continue to move the needle with gross margin. Gross margin change year to year is pretty dramatic, right? So now we're trying to incrementally improve as the business grows, and if we can do that, I think that would be quite valuable.

Thanks so much, guys.

Thank you. The next question comes from Justin Clare with Ross Capital Partners. Please go ahead.

Hey, good morning. Thanks, guys. So I wanted to follow up on the semiconductor opportunity here and just wanted to see if you could share a little bit more about the visibility you have into the pipeline of opportunities in semiconductor. And then if you could speak to are you primarily seeing the growth being driven by the U.S. market or are you also seeing healthy international growth. And then lastly, maybe if you just speak to order sizes within semiconductors and how they might be trending.

Yeah, make sure I hit all those points because I think it's tremendous to get people to understand what we're seeing. I mean, the pipeline is huge. It's triple digit potential for us. And again, if we grow the business It could be a triple digit part of the business if it's really gets to the point where if materials and driven by semiconductor, not semiconductor alone, probably could get to that level. And that's based upon projects that we know that are low risk, that we feel that are either about to be constructed or in construction. It's global, so it's not just the U.S. There's definitely a drive in the U.S. to reshore, to bring that capacity and capability here, but there's the broader issue, which is there's a need for more computational power, particularly small device computational power in a variety of applications that really fit into the FABs that we deliver our solution to. You know, today a FAB order could be as, you know, small as 2 million. One time we were trying to get it up to a million, but today I think they're almost all over 2 million. And the larger ones can approach 8 to 10 million. I think we see things on the horizon where a single fab could be 10 to 15 million in a few years, given where we're headed, where the size of fabs are going to grow. and the level of static and dynamic capability that we provide to that business. So we're really pleased. And it's not just with one maker. It's several makers. We're trying to get further and deeper in what our capability is for them so they can understand the value that they get from our offering. And again, as I kind of said a little bit earlier, we're just selling it as an AMSC solution. And the teams are working as one, not necessarily separately on these key accounts. Specifically, like Semiconductor is a great example of that.

Okay. That's really helpful. And then I just guess more broadly on demand and the orders that you're seeing, you know, fiscal Q4 was strong. Wondering if the implementation of the tariffs and then the pause, has that had any notable effect on the cadence of orders that you've seen from your customers? Wondering if you could just speak to how things have kind of evolved into your fiscal Q1 here.

Yeah, I think in the short term, I can say, if anything, it's helped. I think in the future, if anything, it's going to continue to help. The level of reshoring that we're seeing and the level of investment that's being considered, it's extraordinary. And I think we really sit at the center where there's a power quality problem or a power control problem. We have some unique offerings. And in some cases, we're the only American provider to be able to provide. So I kind of saw this as the rhetoric was changing after the election, that this could present itself as an opportunity for the company. I see that today, and I hope to see that going forward as well.

Got it. Okay. And then maybe just shifting over to the Navy here. So you have delivered the three systems to the U.S. Navy now, and wondering if you have any details on how those systems are performing? Have they been in the field? And do you have kind of, you know, demonstrated performance that has advantages over legacy solutions that could help you to, you know, sell more of those systems? I know this information is fairly sensitive given that it's with the military, but to the extent that you have any detail there.

Yeah, all I can really say is yes to everything that you said. It is a differentiated solution that works. it works as well or better than advertised. The U.S. Navy is excited about what we're doing, not just there, but in other parts. We've talked about the power continuum for them. I think getting the Canadian Navy then reaffirms the whole technology again, that this is really valuable and viable. So I know, you know, I had somebody tell me the other day that they, like, did superconductors ever get commercialized? And I'm like, yeah, that happened years ago. This is real. It's effective. It works. They're happy. I don't want to get into the differentiators because that gets into some classified stuff. But we're really happy. It's a pleasure working with the Canadian Navy so far. It's been a very proud moment for us as a company to be able to provide real-world systems for the U.S. Navy. So, yeah. The hope is we can go scale that and be able to bring that to other allies. It's a great offering that we have, and it's real.

Okay. Sounds good. All right. Thank you.

Thank you. At this time, there are no further questions in the queue. This concludes our question and answer session, and I would now like to turn the call back over to Mr. Ghosn for closing remarks.

Great. That was a wonderful articulation of my name. I just want to close up on growth because I think that the main question is we come out of a great year and position to continue to get better and better. I think the question on your mind might be, and I know that's what we're trying to drive the team, is what's really going to drive our growth in the near term? I think it's semiconductors right here, right now. I think it'll be followed up pretty quickly with traditional energy. I think we have a unique offering there. We're learning about it. We're working with partners to better understand that. And utilities, a lot of the kind of problems that we see are becoming more commonplace across different utilities. We've really seen the beginning of an acceleration in these parts of our business. So semiconductors are expected to be a key driver for orders, and we're already seeing that impact with the acceleration of to the 75 million in orders this quarter. This momentum position is really to benefit from the continued expansion that's coming in the sector, as I commented in the questions. It's global, it's not just domestic, but there is a strong driver domestically for sure. We're now really involved in seeing orders come from traditional energy. I've talked a little bit about it briefly, but I haven't really gotten into it. What we've learned is the combined offering of the different pieces that we've put together may be very uniquely positioned for traditional energy. And if you think about that market, it's really divided into kind of three main stages, upstream, midstream, and downstream. So upstream involves drilling and extraction. Midstream refers to storage and transportation via pipelines. They're supported by compressors and pump stations. They all need critical power to ensure flow. So think about what we're doing is, just like we would do with a semiconductor fab, just like we would do with a chemical plant, you're trying to power a pipeline. How do you do that in a resilient way? How do you do that in an effective way? How do you drive all that equipment? It has to be in harsh and hardened environments. The other market we've seen some recent wins in is downstream, which handles the refining and distribution to users. of the energy products. So we're really not just about renewables. We've diversified now to energy in a broader sense. We're now involved in all three phases, upstream, midstream, and downstream. And our solutions mitigate power impacts from the equipment or processes at each stage, and we try to boost productivity and efficiency in each of these traditional energy operations. The third area I talk about is we're really involved in a variety of different utility projects that enhance grid resilience and support the energy transition. And now what we're seeing is a utility may do one of these And now multiple utilities are doing many of these, right? And again, these are projects that take a little bit longer to be able to deliver. The scope might be a bit higher as well. But we see, and I think this is a key one to highlight as we kind of close out the call, and this is new news for us. We're strengthening substation power quality to support the demand from data centers. We are seeing direct demand now. I talked before we didn't have a direct solution. We're seeing the solution as we have now that we can directly add that into capital projects for data centers to support this rapid build-out. It's new. We're excited. It's a big part of our future pipeline. It's a whole kind of pivot where we're going. I had some hope and some kind of indications that maybe we would get in that direction, and now we're starting to see it. We have the proof that we've delivered, and we have the proof that we've been able to secure additional orders in that area. We're implementing reactive power systems for voltage stability. You guys know about that. We've talked about that for years. But kind of one of the new applications is for the retirement of thermal plants. And we're seeing more and more of these plants where older plants are going to be taken offline. That provides disturbances on the grid that we can uniquely be able to mitigate and manage. We talk a lot historically, but to remind you about reinforcing transmission infrastructure, to support industrial load growth. A good example is large mining operations on vulnerable lines. We're seeing that globally as there's a drive to be able to process and refine materials. And semiconductors is a highly refined, highly processed material that's really key here in the short term as well. So we're really trying to build a diverse business driven by materials like semiconductors, power and energy both from traditional and renewable sources So each of those three pieces really could represent about a quarter of our future business. The remaining quarter is probably going to come from military and utilities combined. Military might be a bit bigger. We'll see where utilities and data centers, where that goes. Maybe that becomes a bigger part of it. But I think the business is clearly aligned for not only the energy transition, but also to support the reshoring of domestic manufacturing in America. And I think that's different. It's a different business I talked to you today about than we did in 2017 or 2020 or even 2022. We're evolving, we're growing, we're trying to meet customer demands, we're trying to extend our product portfolio where we're capable. I'm really happy with what the team did. I think just to recap, big orders over the year that we had, diversified, more navies involved. I think a big part of it is really a testament to the overall team trying to drive this change in the company. And we're starting to see the manifestation of that now. So again, all these calls, everybody says, oh, you sound really excited. If I can't say it enough, I'm really excited not only about what we just did, but what we're going to go do. So thank you, everybody, for your trust, your patience with me. We are really in a great position, and thanks for the time.

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