Impinj, Inc.

Welcome to the MPinge Third Quarter 2024 Financial Results Earnings Conference Call and Webcast. 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 on your telephone keypad. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to send the conference over to Mr. Andy Cobb, Vice President, Strategic Finance. Please go ahead.

Thank you, Gary. Good afternoon, and thank you all for joining us to discuss Impinges' third quarter 2024 results. On today's call, Chris DiIorio, Impinges' co-founder and CEO, will provide a brief overview of our market opportunity and performance. Terry Baker, Intentions CFO, will follow with a detailed review of our third quarter financial results and fourth quarter outlook. We will then open the call for questions. Hussein Mekli, Intentions COO, will join us for the Q&A. You can find management's prepared remarks plus trended financial data on the company's investor relations website. We will make statements in this call about financial performance and future expectations that are based on our outlook as of today. Any such statements are forward-looking under the Private Securities Litigation Reform Act of 1995. Whereas we believe we have a reasonable basis for making these forward-looking statements, our actual results could differ materially because any such statements are subject to risks and uncertainties. We describe these risks and uncertainties in the annual and quarterly reports we file with the SEC. We do not undertake and expressly disclaim any obligation to update or alter our forward-looking statements except as required by law. On today's call, all financial metrics except for revenue or where we explicitly state otherwise are non-GAAP. All balance sheet and cash flow metrics except for free cash flow are GAAP. Please refer to our earnings release for reconciliation of non-GAAP financial metrics to the most comparable GAAP metric. Before turning to our results and outlook, note that we will participate in the Baird 2024 Global Industrial Conference on November 13th in Chicago and the UBS Global Technology Conference on December 4th in Scottsdale. We look forward to connecting with many of you there. I will now turn the call over to Chris.

Thank you, Andy, and thank you all for joining the call. Our third quarter results were strong. with revenue and profitability well above our guidance. Excluding last quarter, with its $15 million licensing revenue, third quarter revenue and adjusted EBITDA both set new records. Strengthened supply chain and logistics, steady growth in retail general merchandise, and continued secular growth in both apparel and long tail applications drove these strong financial results. As Kerry will highlight, These results again demonstrate the leverage in our operating model. Starting with silicon, third quarter endpoint IC product revenue exceeded our expectations. Unit volumes set a new quarterly record as parcel shippers and retailers prepared for the holiday season. And for the third consecutive quarter, M800 shipments more than doubled. Looking to the fourth quarter, we expect endpoint IC revenue to decline modestly versus third quarter, with typical seasonal trends partially offset by market strength. We also expect continued M800 adoption as more M800-based inlays achieve market qualification. Turning to reader ICs, third quarter volumes exceeded our expectations, driven by stronger than anticipated demand for both Indy and eFamily ICs. Looking to fourth quarter, project timing at the large supply chain and logistics end user will push eFamily revenue lower. Longer term, as we wind down our legacy indie ICs, we see continued e-family adoption across the broad range market. On solutions, we expect the current phase of the visionary European retailers' ongoing rollout of our self-checkout and loss prevention solution to spike in the fourth quarter, driving strong fourth quarter gateway revenue and growing endpoint IC volumes. At the large North American retailer, IC volumes continue ramping, driven by expanding general merchandise tagging. And we see the second large North American supply chain and logistics end user increasing label consumption this year and next. These very public enterprise successes are driving additional Fortune 500 enterprises to us, both in existing markets like retail general merchandise and new ones like perishable foods. And with them, endpoint IC volumes. Our enterprise account pipeline is much larger today, and our current base. Expect us to continue investing in enterprise solutions, including software and cloud services that we believe are key to our long-term success. Touching now on the broader market, our conviction in food tagging continues, buoyed by multiple supply chain and quick-serve restaurant rollouts, as well as grocery pilots. While we are still in the early days, the endpoint IC opportunity is at least an order of magnitude larger than any of today's markets. In retail general merchandise, we continue seeing retailers piggyback on the pioneering rollout at the large North American retailer. In Qualcomm's statement about ring reading and mobile devices, galvanized expectations of ring as a digital product passport data carrier. It also piqued retailer interest in engaging consumers through their connected items. At the recent Rain Alliance meeting in Florence, I highlighted one potential use case, which is consumers crowdsourcing their location of items in our everyday world. Think Bluetooth trackers, no additional cost, and with 10,000 times today's footprint. With overall rain penetration still less than 1% of the total connectable market, we remain laser focused on winning the race to connect everything. In closing, we delivered a very strong third quarter. Our solutions focus continues paying dividends, and I am personally heartened by the consumer opportunity, which I've been touting for what feels like ages, finally seeming within reach. Looking ahead, we see continued secular endpoint IC growth, category expansion, and burgeoning solutions opportunities. As we continue driving our bold vision, I remain confident in our market position and energized by the opportunities ahead. Before I turn the call over to Kerry for our financial review and fourth quarter outlook, I'd like to again thank every member of the impinged for your tireless effort. As always, I feel honored by my incredible good fortune to work with you.