Calix, Inc

Greetings, everyone, and welcome to the Calix third quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the brief prepared remarks. If anyone should require operator assistance during this conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jim Finucchi, Vice President of Investor Relations. Sir, please go ahead.

Thank you, Kat. And good morning, everyone. Thank you for joining our third quarter 2023 earnings call. Today on the call, we have President and CEO Michael Vaney and Chief Financial Officer Corey Sintelar. As a reminder, yesterday after the market closed, Calix issued a news release, which was furnished on a Form 8K, along with our stockholder letter, which was also posted in the investor relations section of the Calix website. Today's conference call will be available for webcast replay in the investor relations section of our website. Before I turn the call over to Michael for his opening remarks, I want to remind everyone on this call we will refer to forward-looking statements, including all statements the company will make about its future financial operating performance, growth strategy and market outlook, and actual results made different materially from those contemplated by these forward-looking statements. Factors that could cause actual results and trends to differ materially are set forth in the third quarter 2023 letter to stockholders and in the annual and quarterly reports filed with the SEC. Calix assumes no obligation to update any forward-looking statements which speak only as of their respective dates. Also in this conference call, we will discuss both GAAP and non-GAAP financial measures. reconciliation of gap to non-gap measures is included in the third quarter 2023 letter to stockholders unless otherwise stated all financial information referenced in this call will be non-gap with that it is my pleasure to turn the call over to michael michael please go ahead thank you jim in the third quarter of 2023 the calix team continued our track record of improved financial performance across four measurable objectives that we've outlined for investors first

Deliberate revenue growth continued as we achieved our 10th consecutive quarter of sequential growth while delivering record revenue. Our demand frontier remains strong as broadband service providers, who we call BSPs, continue to recognize that building fiber is not enough. As speed as a go-to-market strategy will not win in the long term. At Connections, our Customer Success and Innovation Conference held last week We focused on how BSPs can transform their business with the Grow Your Community Playbook, which is their recipe for success as they take on the legacy and consumer giants. The playbook clearly lays out how a BSP can leverage the Calix platform and managed services to simplify, which yields the highest margins and the fastest time to market, excite, which creates the subscriber experiences that yield the highest net promoter scores, and grow for their investors, for their members if they are cooperative, and for the communities they serve. Second, gross margin expansion continued with our fifth consecutive quarter of margin growth while we delivered record gross margin as strategically aligned VSPs continued to expand their use of the Calix platform and managed services to achieve their business and financial goals. We executed disciplined operating expense management following the model outlined in the investor letter and continued to invest fulsomely to take advantage of the once-in-a-generation growth opportunity ahead. Fourth, ongoing predictability continued as we met or exceeded the guidance that we laid out for investors in July. In third quarter, I continued to invest a significant amount of time meeting with customers, prospects, partners, and team members. I have just returned from our most successful connections ever. Attendance set a new record at almost 3,000 attendees, and the excitement in the room was palpable as Calix is perfectly positioned to be the catalyst for the biggest disruption our industry has ever seen. Our mission and the disruption we are enabling is evidenced on the main stage, which you can see on the videos at calix.com. Tom Bigby-Fiber shared how their cooperative leveraged the Kallus platform and managed services to beat the industry's norm of a new broadband provider requiring seven years to get to cash flow positive. They achieved cash flow positive in two and began generating seven-figure monthly profits in year three. In addition, they launched Spark in two weeks for employees and subscribers to protect children from cyberbullying and deploy smart towns cover nine football fields with a return on investment that was significantly higher than traditional advertising. It is easy to see why their net promoter score is 91. Hunter Communications shared their journey from serving businesses to serving the entire community by leveraging the end-to-end Talix platform and managed services such as Smart Home and Smart Biz. Our platform and managed services have enabled their team to lead their market with average online reviews of 4.8 out of 5 when competitors are as low as 1.1, exceeding 30% take rates in only 18 months and growing revenue by 300% and EBITDA by 400%. United Fiverr, founded in 1937 as an electric cooperative, shared how by leveraging the unique Calix broadband platform and growing managed services portfolio, They transformed their economics. Broadband revenue has enabled them to freeze electric rate increases since 2015 and return 9 million to members. They were told it would take 12 years to achieve cash flow positive, and they did it in four. They have continued that success, growing to 32,000 subscribers across 45 communities. Through the quarter, our broadband platform continued to enhance our partner ecosystem that enables BSP success. Most notable, we announced a significant expansion of our partnership to a joint roadmap with NISP, the leading OSS, BSS, and solution provider to rural broadband and electric cooperatives. Our ongoing focus on our purpose-driven culture, which is constantly evolving to meet the needs of our team members, customers, and partners, remains a focal point and a key driver on why people want to join Calix. In the investor letter, we highlighted that the industry continues to acknowledge our culture and products through awards, such as the Best Tech Culture from TMC and Calix Marketing Cloud winning a technology award for superior marketing insights and analysis. It remains a great time to be part of the Calix team as we continue to embrace the notion of constant improvement through our better, better, never best mindset. And our leadership team continues to believe that we're just getting started. Before I close, I'll turn it over to Corey to expand on the team's stellar performance in the third quarter. Corey? Thank you, Michael.