Kornit Digital Ltd.

Ladies and gentlemen, good morning and welcome to the Cornet Digital Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jared Maiman, Investor Relations for Cornet Digital. Please go ahead, sir.

Thank you, operator. Good day, everyone, and welcome to Cornet Digital's third quarter 2024 earnings conference call. Joining me today are Chief Executive Officer Ronen Samuel and Lori Hanover, Cornet's Chief Financial Officer. For today's call, Ronen will provide comments in the third quarter of 2024. Lori will then review the third quarter numbers and provide our fourth quarter outlook before we open it up for Q&A. Before we begin, I would like to remind you that forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. securities laws will be made on this call. These forward-looking statements include, but are not limited to, statements relating to the company's plans, strategies, projected results of operations, or financial condition. And all statements that address developments that the company expects will occur in the future. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause results to differ materially from those implied by the forward-looking statements. I encourage you to review the company's filings with the Securities and Exchange Commission, including the company's annual report on Form 20F filed with the SEC on March 28, 2024, which identifies specific risk factors that could cause actual results to differ materially. Any forward-looking statements are made currently, and the company undertakes no obligation to publicly update any forward-looking statements except as required by law. Additionally, the company will be making reference to certain non-GAAP financial measures on this call. The reconciliation of these non-GAAP measures to the most directly comparable GAAP measures can be found in the company's earnings release published today, which is also posted on the company's investor relations website. At this time, I'd now like to turn the call over to Ronan. Ronan? Ronan?

Good morning, everyone, and welcome to our third quarter 2024 earnings conference call. Today, I'm pleased to report revenues of $50.7 million and adjusted EBITDA margin of 2.9%, both within the guidance ranges we set in August. Achieving positive EBITDA and generating cash from operations this quarter underscores a Our discipline focused on cost control, working capital improvements, and operational infrastructure optimization, all positioning us for sustainable, profitable growth. Our growth margin also saw substantial improvement, climbing to over 50%. This shift reflects a more profitable sales mix and higher margin products and services. showcasing the operational gains we are realizing as we transform our business model. As we discussed during our investor event in September, our revamped go-to-market strategy is unlocking significant new market opportunities. Outdated fashion supply chains are struggling to keep pace which today demands for speed, creativity, and sustainability, and brands are urgently seeking agile production solutions. Kornit's offerings meet these needs precisely, and we are seeing accelerating demand for analog screen production to digital conversion. Our Apollo system, coupled with the new all-inclusive Qlik or AIC model, is driving this shift. with 12 out of 15 Apollos already shipped this year, and the remainder scheduled to deployment before peak season. We are collaborating with industry leaders like Print Palace and T-Formation, and our pipeline of pure play analog screen businesses interested in Apollo and Max technology continue to grow. Our AIC model is a key driver, addressing the multi-billion impression analog screen replacement opportunity by lowering the barriers of entry for high volume manufacturers seeking transition to digital production. AIC provides a predictable cost structure while eliminating the need for capital investment, enabling manufacturers to leverage digital agility while meeting the quality demand of global brands and retailers. This quarter, we also shipped multiple Atlas Max systems on AIC model and have added promising new opportunities for AIC on Max into 2025. This combination of our innovative technologies And this powerful business model is expanding our market reach and accelerating the industry transition to on-demand digital production. Looking ahead to 2025, we are on track to deliver 30 Apollo systems with approximately 20 expected to be on AIC model. We already have a firm visibility on more than half of these systems with some as confirmed orders. This aligns well with our long-term financial targets, which includes double-digit revenue growth and growing base of recurring revenues from AIC and enhanced profitability. Beyond progress with Apollo and AIC, during the quarter, we upgraded some of the Atlas fleets of our global strategic account to the Atlas Maxx. We are also advancing and seeing momentum in the role-to-role business, particularly in the footwear market. In China, we are making significant progress in this market with both existing and new customers. A strategic customer already using our technology has received large orders from major brands and is now ramping up production with our PrestoMark systems. This growth presents potential for expansion with additional systems early next year. We have also secured a new order from another prominent player in China's footwear market, both of whom supplies to major global brands. This progress underscores our competitive edge and positions us for continued success in our role-to-role into 2025. As we enter fourth quarter peak seasons, the market is showing continuous signs of improvements validated by strong consumable and systems order for Q4 delivery. This visibility paired with the growing momentum of AIC support our expectation for gradual recovery and the year-over-year growth in Q4, consistent with our guidance for H2 to be at least 20% higher than H1. In closing, we are seeing good signs of stabilization and recovery, which are driving anticipated improvements in revenue growth and profitability. Cornit is well positioned to lead the digital transformation of the textile industry. Brands and retailers need agility, and our solutions meet these demands of speed, quality, and sustainability. Supported by the recurring revenue from AIC and our industry leadership technology, we are confident in Kornit's path towards 2025, delivering value for our customers, shareholders, and employees alike. Now let me turn the call over to Lori for a closer look at our Q3 results and guidance for the fourth quarter.