Itron, Inc.

Welcome to ITRON's first quarter 2025 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. Please note that today's conference is being recorded. I will now hand the conference over to your speaker host, Paul Vincent. Vice President, congratulations. Please go ahead.

Good morning, and welcome to ITRON's first quarter 2025 earnings conference call. Tom Dietrich, ITRON's president and chief executive officer, and Joan Hooper, senior vice president and chief financial officer, will review ITRON's first quarter results and provide a general business update and outlook. Earlier today, the company issued a press release announcing its results. This release also includes details related to the conference call and webcast replay information. Accompanying today's call is a presentation that is available through the webcast and on our corporate website under the Investor Relations tab. Following prepared remarks, the call will open for questions using the process the operator described. Before Tom begins, a reminder that our earnings release and financial presentation include non-GAAP financial information that we believe enhances the overall understanding of our current and future performance. Reconciliations of differences between GAAP and non-GAAP financial measures are available in our earnings release and on our investor relations website. We will be making statements during this call that are forward-looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from these expectations because of factors that were presented in today's earnings release and comments made during this conference call as well as those presented in the risk factor section of our Form 10-K and other reports and filings with the Securities and Exchange Commission. All company comments, estimates, or forward-looking statements are made in a good faith attempt to provide appropriate insight to our current and future operating and financial environment. Materials discussed today, May 1st, 2025, may materially change, and we do not undertake any duty to update any of our forward-looking statements. Now please turn to page four of our presentation as our CEO, Tom Dietrich, begins his remarks.

Thank you, Paul. Good morning, and thank you for joining our call. ITRON performed well during the first quarter. A favorable product mix and continued strong execution supported margin expansion and earnings growth ahead of expectations. The team is focused on the execution of our strategy, and the results from the past quarter further demonstrate its effectiveness. Financial highlights for the first quarter are detailed on slide four and include revenue of $607 million, adjusted EBITDA of $88 million, non-GAAP earnings per share of $1.52, free cash flow of $67 million. Turning to slide five, the record gross margin and strong earnings growth were driven by our disciplined manufacturing and the ability to meet our customers' core needs for robust solutions for their mission-critical operating challenges. Customer demand for our solutions is driven by the breadth of our offerings, particularly customer adoption of ITRON's great edge intelligence platform. Our customers are benefiting from increased distribution capacity, improved infrastructure agility, and enhanced reliability of successful scale deployment. Turning to slide six, bookings in the first quarter of $530 million were in line with our expectations and equate to a book-to-bill of 0.9 to 1 for the quarter. This is an increase of $169 million when compared to last year, and as a result, our $4.7 billion backlog at quarter end remained near record levels. The network solutions and outcomes segments continue to dominate our bookings. representing over 95% of our total backlog. Deployment of distributed intelligence solutions also continued during the quarter, and by quarter end, we have shipped 14.4 million distributed intelligence-capable endpoints with another 10-plus million in backlog. Some of the key bookings for the quarter include a major project with longtime customer First Energy, which will expand infrastructure to detect and locate outages more quickly and enhance data management solutions. These improvements will provide consumers with more detailed information, enabling them to better understand and control their energy usage. ITRON will support a grid modernization project for Public Service Company of New Mexico, the state's largest electricity provider. This project will deliver several benefits, including distributed intelligence capabilities to enhance efficiency, reliability, resilience, and security of PNMs operation. It will also enable real-time energy usage information for consumers and improve the integration of distributed energy resources. Before I turn the call over to Joan to cover the financials, I want to briefly discuss the tariff landscape from both a demand and bottom line perspective. For demand, we have not seen a change in customer behavior to this point. While we are mindful that prolonged uncertainty could ultimately impact demand, our customers currently remain focused on addressing the critical needs in the management of energy and water. With respect to the bottom line, our regional supply strategy is serving us well. A great majority of our global manufacturing is done regionally, for instance, in South Carolina for the United States. However, we do import components from global sources, with Mexico being the largest country of origin for components used in U.S. products. Our Mexico imports are generally USMCA compliant and currently not subject to tariffs. The EBITDA impact for the year under the current tariff protocol is estimated to be approximately $15 million net of mitigation measures, such as alternate sourcing and pricing adjustments. It is important to note that the tariff environment is extremely dynamic, and the current estimate may change. Despite this fluid environment, we remain balanced and well positioned to drive our business forward. Now, Joan will provide details for our first quarter and our outlook for the second quarter.