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spk03: as a result of a number of risks and uncertainties, including, without limitation, the risk factors set forth under the caption risk factors in our perspectives filed with the SEC on September 3rd, 2021, and in our other documents filed with or furnished to the SEC. The forward-looking statements made today represent our views as of November 10th, 2021. Although we believe that the expectations reflected in these forward-looking statements are reasonable, We cannot guarantee that future results, level of activity, performance, and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Acceptance may be required by applicable law. We specifically disclaim any obligation to update them to reflect future events or circumstances. Before I turn the call over to Peter George, let me briefly bring to your attention a few upcoming investor events. Tomorrow, Thursday, November 11th, we will be at the Steeple Midwest Investor Virtual Conference. On Tuesday, November 30th, we will be at the Credit Suisse Technology Conference in Scottsdale, Arizona. And on Wednesday, December 15th, we'll be at the Imperial Capital Conference in New York City. We will also be hosting a variety of other live and virtual investor events throughout the quarter. For more information or to schedule a meeting with the management team at any of these conferences, please contact me at bnorris at evolvedtechnology.com. With that, I'd like to turn the call over to Peter.
spk02: Peter? Thanks, Brian. Good afternoon, everyone, and thank you for joining us today. We have a lot of exciting news to share regarding the third quarter and our business momentum. But before we start, I want to take a moment to formally introduce Mario Ramos, who joined us last week as Chief Financial Officer of and Chief Risk Officer. Mario brings over two decades of executive experience building and leading high-growth companies, and his financial and strategic leadership will be instrumental in supporting our next stage of growth. He's had a very successful career, which included a six-year run at CVS in a variety of executive leadership roles, including CFO of CVS Caremark. Before that, he was head of CVS's M&A and corporate development group and led the acquisition and integration of Aetna, which, as you know, is a signature transaction in the transformation that CVS has gone through. He has also served as COO of CVS International and spent over 17 years on Wall Street, primarily at J.P. Morgan and Lehman Brothers. We're thrilled to have you on board. Welcome, Mario.
spk01: Thank you, Peter. It's great to be here, and thank you for the warm welcome. I'm excited to join the team, and I look forward to meeting and working with all the members of the investment community. Let me just share a little bit of why I joined the company, which started first and foremost with its mission. I really believe strongly in Evolve's mission of creating a safer world for everyone to work, learn, and play. Also, as we continue on our growth trajectory, I believe we'll need to continue scaling the business to maximize efficiency and maintain our market-leading position. This means building a solid foundation and infrastructure across the company with a special focus in certain areas like supply chain, among others. I'm proud to say I've spent a large portion of my career scaling and leading digital transformations of companies based in the U.S. and abroad. I'm looking forward to putting that experience to work at Evolve a leader in one of the fastest-growing markets across all of technology.
spk02: Thanks, Mario. Great to have you on board. I also want to take a moment to thank Peter Faubert for all his contributions to the business over the last two years and all the contributions he will make as he takes on the challenges of his new role as Senior Vice President of Strategic Finance. In this capacity, he will play an important role in the company's growth initiatives. We're pleased to be reporting strong third quarter results, highlighted by record total contract value of orders booked and record revenues. We continue to extend our leadership position with dozens of new customers and expansions at existing customers, strong new product introduction and acceleration with our key channel partners. We remain on track for a strong finish in 2021 and are well positioned to deliver on our TCV and market expansion goals. Two of the KPIs that we consider to be key measures of our progress are TCV of orders booked and revenue. We delivered record results in both metrics in Q3 and are already off to a strong start here in Q4. TCV was 16.9 million in the third quarter, up 365% year over year. Revenue was 8.4 million in the third quarter, up 473% year over year. While we don't plan to share this level of detail every quarter, we wanted to provide some additional context around the momentum we're currently enjoying. We saw a record number of new customers in the third quarter, a seven-fold increase compared to the third quarter of last year. We had a record number of units booked, more than a five-fold increase compared to the third quarter of last year. We reported five transactions of at least $1 million in the third quarter compared to none in the third quarter of the last year and four seven-figure transactions in the previous four quarters combined. Our ASPs, which is a proxy for average deal size, increased by over 50 percent compared to the third quarter of last year. I am particularly pleased that we saw broad diversification of our TCV activity across nearly 10 target vertical markets, and no one transaction amounted to more than 15% of TCV in the quarter. About a third of our TCV came from professional sports, with important contributions from the NFL's Carolina Panthers and Tennessee Titans. Three other vertical markets each contributed about 10% to TCV in the quarter, including performing arts centers, convention centers, and factory warehouses. We also saw important contributions from hotels and casinos, as well as in two other rapidly emerging markets, healthcare and government. In summary, by any measure whatsoever, TCV in revenues, accelerating sales cycles, growing ASPs, and volume of seven-figure transactions, the accelerated investments we've been making in our customer-facing functions and in our channel partners are paying dividends. This gives us greater confidence to continue this strategy on our path to meet our 2022 and 2023 growth plans. We continue to make great progress on our goal of winning the professional sports market, a market we began investing in just a year ago. At that time, we had virtually no brand awareness and we had no customers. I'm delighted to report that as of the end of the third quarter, 15% of Major League Baseball franchises, including the Chicago Cubs and the San Francisco Giants, are now screening all entering fans with Evolve Express. During the MLB season, we scanned upwards of 250,000 baseball fans on any given night at stadiums across the country. Further, a full 10% of all National Football League stadiums have now adopted Evolve Express to screen all entering fans, including the home venues of the Atlanta Falcons, the Carolina Panthers, and most recently, the Tennessee Titans. On any given Sunday in the NFL, we are now screening over 200,000 professional football fans. The professional sports market is a relatively small part of our $20 billion total addressable market, or TAM. It's part of the $2 billion regulated market, along with aviation, which currently uses outdated analog metal detectors. Our progress in this market reflects our unique ability to deliver vastly improved venue security and transform the fan experience while reducing the need to hire hard-to-find security personnel. We're also seeing more and more team executives, guest services personnel, and fans themselves demanding evolve. These early beachheads across MLB, the NFL, and now MLS are important, too, because of the visitors that attend events at these facilities. These include economic buyers, safety leaders, and facility operators and other verticals, including distribution warehouses, performing arts, casinos, and schools. We believe that all of this newfound awareness It's part of the network effect and force multiplier for evolved technology. Let me tell you a little about a few of these customers. The Tennessee Titans had previously been using walk-through metal detectors and handheld wands that required over 280 security personnel to work the gates at Nissan Stadium. The Titans installed 17 SAS-based evolved express units which have been active now for the last several home games. The result has been a remarkable 66 percent reduction in the number of security personnel needed at their gates and a dramatic improvement in the overall guest experience. Over the last three home games, we've stopped 54 guns, knives, and other prohibitive items from entering Nissan Stadium. And on a scale of zero to five, the average guest gate entry rating has more than doubled from 2.23 to 4.6. This is a perfect example of why customers deploy our technology. Our ability to deliver dramatically increased security posture, greatly improved the guest experience, and lower the venue's operating costs, primarily security labor costs. Another example is the Pittsburgh Cultural Trust, which selected us to provide improved weapons detection and overall guest experience across multiple theaters, performance halls, galleries, and other venues in the Historic Entertainment District. Evolve Express is now in place for the performance halls and theaters in the Cultural District, as well as the Space Visual Arts Gallery. This deployment builds on our success at Pittsburgh Symphony Orchestra's Heinz Hall where we were able to reduce the security screening footprint in the lobby by 60% while also eliminating outdoor queues where guests previously waited in poor weather. One of the most important elements of our long-term growth objectives is of course the leverage we gain from our channel partnerships. Today we have nearly 36 authorized channel partners and several strategic global partners in Motorola Solutions, our OEM, Johnson Controls, and Stanley Black & Decker. I'm delighted to report that our channel program contributed to one third of our TCV order activity in the third quarter. Let me share a few other highlights of our indirect go-to-market efforts. Let's start with our partnership with Motorola Solutions. Since announcing the partnership late in Q2, We've made great progress on cross-training, enablement, activation, and certification of the Motorola solution sales and sales engineering teams. While it's still early, we're encouraged not only by the early wins we've now secured, but by the momentum in the pipeline. We now have nearly 60 qualified opportunities in our pipeline with Motorola across professional sports, schools, hotels, and casinos, healthcare factory warehouses, and government where they have such a strong market position. More to come there, but we're excited about the accelerated opportunities and business that we're finding together. In addition, we recently worked with Stanley to secure an important win at the Indianapolis Symphony Orchestra, one of the most iconic performing arts venues in the nation. Evolve Express was installed at the historic Hilbert Circle Theater to create a seamless and safer entry experience for the ISO's audiences, museums, musicians, and staff. We're proud to partner with them on the journey to digitally transform their physical security and delight their patrons. We also have very strong regional partners which have close, long-standing customer relationships, and in many cases, deep vertical market expertise in the markets we're focused on. A great example of this is VTI Security, based in Minnesota, where we're seeing growing traction, particularly in the healthcare market. We work together with VTI to secure several new customers in the third quarter, including the Mayo Clinic Health System, which has dozens of locations in several states. were now being deployed in emergency entrances of their hallmark location in Rochester, Minnesota to provide patient and staff safety. Our success landing that initial location in the third quarter has led directly to expansion opportunities at other Mayo Clinic locations. This is a perfect example of our land and expand strategy coming together with our scale through partner approach. As you know, first and foremost, we're a technology company. I want to close with a few comments about some exciting technical innovations we introduced in the third quarter. We're very excited about the latest release of Evolve Insights, our web-based portal companion to Evolve Express, which helps companies advance venue security with the power of data analytics to make venues smarter. Evolve Insights has three things. Number one, on demand. New mobile access to key metrics and remote scanner management enables security and operations leaders to make better data-driven decisions about their security posture from any location for more responsive venue management. Number two, it's data-driven. The new analytics in Evolve Insights allows for the integration and interrogation of threat types and alarm rates, informed decisions around sensitivity settings, and better understanding of event characteristics, improving security posture, staffing and training, and venue resource planning. And number three, it's connected. The new remote management capabilities allow administrators to access Evolve Express systems for remote configuration and monitoring, including important notifications and system changes regardless of where they are in the world. I want to thank our entire R&D team for their incredible work, which continues to deliver ever-increasing value to our customers through our AWS-enabled cloud offering and continues to set the standard for innovation across the industry. So, in summary, we're pleased to be reporting strong third-quarter results highlighted by record total contract value of orders booked and record revenues. We continue to extend our leadership position with a record number of new customers and expansion of existing customers, strong new product introduction, and acceleration with our key channel partners. We remain on track for a strong finish in 2021 and believe that we are well positioned to deliver on our TCV and market expansion goals. So with that, let me turn it over to Peter Faubert to review our financial results in more detail and on our outlook for the balance of the year. Peter?
spk04: Thanks, Peter, and good afternoon, everyone. Today I'll cover our financial results for the third quarter and our outlook for the balance of the year. I'll start with our third quarter results. The total contract value of orders booked, or TCV, was $16.9 million in the third quarter, up 365% year-over-year, reflecting strong new customer additions. Total revenue was $8.4 million, up 473% year-over-year, reflecting strong new customer additions across our core vertical markets, as well as an expanded cohort of customers that chose to purchase hardware upfront. Product revenue was approximately $5.3 million, compared to $300,000 in the third quarter of last year. reflecting the decision of two large customers, the Carolina Panthers of the National Football League and a major New England area convention center, to purchase Evolve Express at the beginning of the subscription period. These two transactions resulted in about $3 million of product revenue in the third quarter of 2021. Looking ahead, we expect a greater percentage of our revenue to shift to pure subscription revenue, which tends to provide much higher recurring revenue. Subscription revenue was $2.3 million, up 190% year-over-year, primarily reflecting the strong new customer additions and growth in systems in service. Service revenue, which primarily consists of professional services and training, was approximately $700,000, up 125% year-over-year, reflecting an increased volume of installations. Subscription gross margin expanded to 53% in the third quarter from 43% in the second quarter, as we saw continued benefit from our scaling operations. Product gross margin increased to 45% in the third quarter from 15% in the second quarter, primarily due to certain credits we received from our contract manufacturer for inventory that we had provided to them. Excluding this benefit, our product gross margin would have been 25% in the third quarter, which again would have demonstrated solid improvement from the 15% in Q2. Total gross margin was 50% compared to 25% in the second quarter of 2021. Excluding the product cost of goods sold benefit that I just described, gross margin would have been 36% in the third quarter. Total operating expenses were $20.8 million in the third quarter, up 205% year over year. The primary drivers of the increase were headcount additions across the company, most notably in revenue generating sales, as well as technical talent for our engineering team, stock-based compensation expense, transaction costs associated with the offering, as well as a modest impairment charge for the write-down of certain assets. We exited the third quarter with approximately 160 employees compared to approximately 50 employees at March 31, 2021. Our loss from operations was $16.6 million in the third quarter compared to $6.2 million in the third quarter of last year. Finally, we reported net income of $23.2 million or 15 cents per diluted share compared to a net loss of $6.3 million or 70 cents per diluted share in the year-ago period. Now turning to the balance sheet. We ended the quarter with approximately $334 million in cash and cash equivalents compared to $4.7 million at December 31st, 2020. This increase reflects the completion of our public offering in the third quarter of 2021 More specifically, our financing activities in the third quarter included $300 million in pipe proceeds and approximately $51.2 million in proceeds from the closing of our merger with Newhold. We ended the quarter with net accounts receivable of $7.3 million compared to $1.4 million at December 31, 2020, reflecting strong new customer acquisition and billing activity. We ended the third quarter with property and equipment of $17.8 million compared to $9.3 million at December 31st, 2020. This growth reflects strong customer adoption of solutions via our pure subscription pricing model under which we retain title of Evolve Express. I'll close with a few comments on how we're thinking about the rest of the year. I will remind you that these forward-looking statements represent our views only as of today. Based on the strength of our third quarter results and our outlook for the balance of the year, we are raising our previously issued guidance for both TCV and revenue. Our current expectations are for full year total contract value or TCV of between $53 and $57 million compared to our previously issued outlook of $53 to $55 million. Though it is our practice to only provide our business outlook on an annual basis, with only one quarter to go in the year, our outlook by extension calls for TCV of between 17 and 21 million dollars in the fourth quarter of 2021. Our current expectations for full year revenue of between 20 and 23 million dollars compared to our previously issued outlook of 20 to 21 million dollars, again, only with one quarter left to go in the year, our outlook by extension calls for revenue between three and six million dollars in the fourth quarter of 2021. This reflects our expectation that more customers will be traditional subscription transactions versus the greater contribution of purchase subscription transactions that we saw in Q2 and Q3. The core drivers that support our overall growth opportunity are intact. The key trends of escalating gun violence, venue reopening, and the demand by visitors for a more frictionless and touchless guest experience are all powerful drivers for growth for us. We expect to continue to invest across the business, mostly in revenue generating and revenue supporting headcount, as well as in engineering resources to continue to extend our leadership position. We believe all of these investments will put us in excellent position to continue to capture the opportunity in 2023 and beyond. We'll provide a detailed outlook during our fourth quarter earnings call in March of 2022. So in summary, we're pleased with our strong third quarter results. We're excited about our plans for the fourth quarter and the opportunity ahead in 2022. And with that, I'll turn the call back over to Brian.
spk03: Thank you, Peter. At this time, we'd like to open the call up for Q&A. Again, we ask participants to limit themselves to one question and one follow-up. Operator?
spk05: And ladies and gentlemen, if you wish to ask a question, please press 1, then 0 on your touch-tone phone. You may remove yourself from queue at any time by pressing 1, 0 again. If you're using a speakerphone, please pick up the handset before pressing numbers. Once again, if you have a question, please press 1, then 0 at this time. Okay, and our first question will come from Mike Lattimore with Northland Capital Markets. Please go ahead.
spk06: Yeah, congratulations. Great quarter there. Great momentum in the business. Thank you. Thanks, Mike. I like the emergency room example. That seems like that's a logical one that could kind of go everywhere. Yeah. So you gave generally an employee headcount update. How is the Sales, hiring going, is that on track? And, you know, what kind of backgrounds of people are you seeing there?
spk02: Yeah. Thanks, Mike. Good to have you on the call. So just your point about the emergency room. So we saw healthcare as one of the big emerging verticals in Q3 that we think is going to be one of the biggest verticals for the company going forward. You may remember last quarter we talked about casinos, and theme parks as being big parts of our growth. This quarter, it was healthcare. So it's a natural place for us. We're excited about what that means. So to capture that demand, we're continuing to add new people across the company. You know, we started the year, as you know, with about 50 people. We're going to exit this year with about 180, and we're adding people in every part of the organization. in particular quota-carrying salespeople, to capture the demand in the market. So we should exit this year with 25 to 30 quota-carrying salespeople. In conjunction with that, another 10 to 15 solution engineers. They team sell with our customers. And then, of course, you heard the work that we're doing to activate the channel. We were thrilled to see the channel represent a third of our business in the quarter, and we expect that to continue. And, of course, our channel partners like Motorola and Stanley, these are big, sizable companies with hundreds of salespeople. And in some cases, Motorola has thousands of channel partners. This is going to be a process and a journey with them, but it's going to have a big impact on our future ability to get operational leverage in our go-to-market model. So between the people we're hiring and then getting that scale through the channel, we'll be able to capture the growing demand in the market.
spk06: Yeah, perfect. And then you talked a little bit about more bookings in the subscription category in the fourth quarter relative to product. Is that tied to a vertical mix or channel versus direct, or is it just kind of a bottoms-up analysis?
spk04: Yeah, hi, Mike. It's Peter Flaubert. You know, again, we talk about a lot of the purchase subscription deals that we're closing being in professional sports. If we just look at the pipeline in Q4, a lot of the pipeline is coming from that $18 billion TAM, the greenfield opportunities. So we expect that there will be a little bit of a shift more towards the subscription deals in Q4. Yeah, okay.
spk06: Great.
spk03: Thanks so much. Good luck. Thanks, Mike. Thanks. Operator, we're ready for the next question, please.
spk05: And next we'll get a line of Brad Reback with Stifel. Please go ahead.
spk07: Great. Thanks very much. Peter, as you think about this really large opportunity within professional sports, it seems like the customer experience gain is so substantial. What's the gating factor for these facilities not to move even faster?
spk02: Yeah, so look, when we thought about our business, we thought about the $18 billion unserved TAM, which are those people that thought about security but didn't want to take the only technology available at the time, which is the metal detector, so they ended up doing nothing. And we began our business going after that market. The truth is we found great success now in professional sports, which is the other regulated area other than prisons and aviation. So now that we've made really good progress with some of the teams and the fan experience in those stadiums is so different than the other fan experiences in the other teams, obviously the physical security people know each other from each of the teams. They're talking to each other, and we think there's going to be a lot of momentum there across the leagues, all the leagues in professional sports, that's going to drive a lot of business for us going forward. So we're really excited about that, so excited that we're standing up a professional sports division. We just hired a world-class executive, formerly with the Nets, knows the space really well, and we're going to aggressively go after this market. And, of course, you have to win at the league level, but you also have to go stadium to stadium. So having people in every geography and every theater that can support and call on these stadiums is really important. We're excited about what that's going to mean, and I think you'll see over the next quarters and years this being a really big part of our business. And, you know, as I mentioned in my comments, one of the biggest values of the professional sports is all the eyeballs that go into those games, whatever sport we're in, that translates, into such a different experience for them that they go back and if they're a decision maker in a performing arts venue or in a theme park, they want to have that same experience and we get that inbound call. So it has a force multiplier effect in terms of people walking through the system and having this transformative experience. So we get a tremendous benefit, not just growing revenue in professional sports, but getting that exposure through the number of people that go to the stadium. So we're excited about it.
spk07: That's great. And then it wouldn't be a conference call nowadays if someone didn't ask about hardware and supply chain. So maybe you can give us an update on where you guys stand in your ability to procure the necessary hardware to meet orders, you know, for the rest of this year and into next. Thanks.
spk04: Yeah. Thanks, Brad. This is Peter Flaubert. Again, you know, as we talked about last quarter, We're still identifying long lead time items. We're aggressively placing purchase orders against those through our contract manufacturer. And we're trying to stock up on raw materials inventory. And I think from a raw materials perspective, we're in great shape through at least the midpoint of 2022. You know, that said, the supply chain, you know, issues continue. And as we ramp into 2022, we're going to continue with that same approach. But, you know, some of these supply chain issues as we're scaling may not allow us to aggressively stock up on these raw materials like we were able to do this year. So it remains to be seen. We're in good shape for now, and we're still actively managing the process.
spk03: Great. Thanks a lot. Thanks, Brad. See you at the conference this quarter. Next question, please, operator.
spk05: And once again, if you'd like to ask a question, please press 1, then 0 at this time. The next question comes from the line of Sandy Bondry with Credit Suisse. Please go ahead.
spk08: Hi. Thank you for the question. You know, you open up with some of the drivers of your business, and I think one of the most critical to much of the strength of your business is the post-COVID recovery dynamic versus the organic and kind of, you know, keep the same course kind of dynamic you guys were going to see anyways in your business. So that's, that's question number one. Question number two is when you think about your five, the five deals that were $1 million plus, how many of those actually include a channel partners? And what I'm specifically trying to get at or try to figure out is, is Motorola an enabler for you to push deals that are much larger than you've really ever seen before? Maybe clarification and color on that. How about that? We can start with those two first, then roll into the others.
spk02: Sure. Well, first of all, welcome, and thanks for your question. Your first question broke up a little bit, but let me see if I had it right. If not, ask me again. So, you know, a couple of big kind of secular tailwinds impacting the growth that we're having in the demand in the business. Number one, everyone during the pandemic has gone through an accelerated digital transformation in every part of their business. Well, that's what we do for physical security, right? We take that dumb analog device called a metal detector and transform it into a digital platform. And so that accelerated, I think, people thinking about when it was time to return. They knew that their employees, their fans, their patrons wanted to return in a different way. And digitally transforming their platform and their threshold allows them to do that in a touchless way. So we've gotten the benefit post-pandemic of people having the time to rethink how they want to do security in their venue. And when they understand that we can not only increase their security posture but make their lines go away, and make sure that the experience is such that you walk right into the venue without breaking stride and nobody has to touch your belongings, well, that's transformative for every venue, which is why we're having such great success as North America is opening up. And we see, you know, hundreds of thousands of thresholds or places that are going to want us going forward. So we're excited about that. Most of the reopening and our business is happening in North America right now, and the international market still has a bit of a COVID hangover. As that begins to open up next year, we expect to feel that same kind of momentum. So the combination of digital transformation, the pandemic, people wanting to return in a new way without any friction in a touchless experience, and then get into the venue and be safe, safe from the anxiety and the the proliferation of weapons in North America. There are 400 million guns in North America, and when people get together, they want to get together and know they're safe from all kinds of threats, not just COVID-19, but also people that have a weapon on them, and that's what we do for them. So we're excited about what's ahead of us. Everyone, these secular tailwinds are impacting all the verticals we're focused on, and we're seeing great traction, and there's lots of room there. The second question, I think, was about these number of million-dollar deals and getting them through the channel. So out of those $5 million deals that we did, three of them were with a channel and two of them were direct. And, yes, the answer is companies like Motorola, Stanley, Black & Decker, and JCI, they have been selling to many of the professional sporting teams, schools, theme parks for years. They've been selling lots of security equipment and lots of other equipment. They have contracts. They have relationships. And so it gives us really not only access but a fast path to deploy our system. So we expect those partnerships to play an increasing role in helping us penetrate professional sports, amateur sports, but all the other venues that they have a great position in, like schools. Motorola has a phenomenal position in the federal government, right? And we want to work with them to make sure that we can reach all the markets in the federal government that we haven't staffed for yet. So, yes, we're expecting these partnerships to give us reach both in vertical and across the globe that we're not going to do organically, and we're thrilled about that.
spk08: Got it. Thank you for the call. Yeah. Okay, and then... So thank you for clarifying that and you know, five $1 million plus deals versus I think you, I believe you said none versus the prior year. Is there an internal bar or expectation on number of $1 million plus deals that you guys want to hit on a quarterly basis going forward?
spk02: You know, we're, we track all the metrics that you might imagine, all the SAS metrics because we're a SAS company. That's one of them, which is number of seven-figure deals. So we're excited about what our pipeline looks for that. And all the leading indicators like ASP growing, sales cycle contracting, upsell opportunities with our customers, all those metrics, including seven-figure deals, we track and we feel very good about what's ahead of us. In terms of the pipeline, what's really interesting is because the competitive landscape is not very aggressive right now. We like to have three times the pipeline in the forward quarters to feel comfortable about landing our numbers. So we have a really good marketing team and channel team helping us build that pipeline. And at the end of the quarter, the deals that we don't get, we may lose a few, but we don't lose a few to competition. We lose a few to no budget. But the deals that we don't get in the quarter typically move to the next quarter. So, you know, we have this really great corpus of pipeline deals to go after every quarter. And if it doesn't close this quarter, then it normally moves to the next one. And it gives us a lot of confidence that we can continue to grow at the rate that we're growing.
spk08: Got it. And then my last question is a technology-related question. Does the Evolve API or information flow directly into, say, a Motorola command center type software suite, or is it currently an independent pane of glass type of software or web page interface?
spk02: Yeah, it's a great question. So we have an open API, which is one of the things I didn't mention in my remarks is Because we're a digital platform and we have an open API, we can connect into both the physical and the cyber infrastructure that we go into. So think about connecting to Motorola's VMS system, their video analytics capability, their license plate readers, that whole lineage of premium products that they have we can connect to. So specifically with our open API, we can send an alert to a Motorola stock and have that connection happen immediately. So yes, that's available for Motorola, but also through all the other partnerships that we're building as well. That open API allows us to integrate into the physical and the cyber infrastructure of all the different ecosystems that customers deploy. But we're excited about what it's going to mean for the partnership with Motorola because they're creating some premium products on our platform that are going to be really unique and compelling and differentiate them in the market in a way that we're excited about, and I know they are too.
spk08: Got it. All right. Thank you. Thank you for your time.
spk03: Sammy, thanks for those questions. We look forward to participating in the conference, the Credit Suisse Conference next month, or later this month, I should say. Operator, I think we have time maybe for one more question.
spk05: And the next question comes from the line of Brian Ruttenberg with Imperial Capital. Please go ahead.
spk09: Yes, thank you very much. Okay, hopefully I'm coming through. Yes, we can hear you, Brian.
spk03: Go ahead.
spk09: Yeah, I'm getting weird feedback, so I apologize. So in terms of EPS, you had been giving guidance of loss of 80 cents to loss of 75 cents on 84 million shares outstanding. Is there an update to that?
spk04: Yeah, just on the EPS in general, we booked all of our D-SPAC transaction accounting entries, obviously when we closed the deal. As part of those entries, we re-evaluated a lot of the derivative liability, earn-out liability, and common stock, contingent common stock liability balances from the closing date. So the big swing in EPS is really around booking those gains based on the reduction in the stock price. And so that was the big swing in the EPS from the loss to the gain.
spk09: Great. Do you have an update on year for adjusted EPS or gap EPS?
spk04: Yeah, we don't really want to talk about it because obviously the stock volatility is outside of our control, so it's really tough to forecast that for the year. All I can say is the ETF swing is not coming from operations. It's really coming from these technical accounting entries.
spk09: Okay, understand. Last question is on Disney Trial. Can you give us an update on whatever happened with the Disney trials? Is there still ongoing trials? And what is the overall status there at the theme park?
spk03: So, Brian, this is Brian Norris. I don't know that we've ever discussed that as a customer of the company. Obviously, we're very focused on the theme park space in general, and I think our technology plays very, very well there. And we're certainly excited to continue to expand our leadership position in the theme park. Vertical. in all parts of the country. How about that? Okay. Thank you very much. Brian, any other final questions there? Anything else we can help you with? Otherwise, we'll look forward to seeing you in December at your conference in New York.
spk09: Yes. Thank you very much. That's it.
spk03: Eric, are there any other questions? Did we get to all of them? I think we did.
spk05: And we have no further questions in the queue at this time.
spk03: Terrific. Okay, well, on behalf of Peter and Mario and Peter and the whole management team and all employees of Evolve, we thank you for participating in this evening's call. We look forward to reaching as many of you as we can in our outreach period. Again, we'll have three conferences during the period. Feel free to reach out to me at bnors at Evolve Technology for more information. Thank you so much.
spk05: And ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using ATT Teleconference. You may now disconnect.
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