Orion Energy Systems, Inc. Q3 FY2025 Earnings Call

Good morning, everyone, and welcome to Orion Energy Systems Fiscal 2025 Third Quarter Conference Call. I will now turn the call over to Bill Jones, Investor Relations, to begin.

Thank you, Olivia, and good morning to everyone joining this call today. Mike Jenkins, Orion's CEO; and Per Brodin, CFO, will review the company's Q3 '25 results and outlook. And following the prepared remarks, we'll open the call to investor questions. Today's conference is being recorded. A replay will be posted on Orion's corporate website, orionlighting.com, in the Investors section. As a reminder, prepared remarks and answers to questions that follow will include statements that are forward-looking under the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally include words such as anticipate, believe, expect, project, or similar words. Also, any statements describing future goals or objectives, company plans, or outlook are also forward-looking. Such forward-looking statements are subject to various risks that could cause actual results to differ materially from current expectations. Risks include, among other matters, those that Orion has described in its press release issued this morning and in its filings with the Securities and Exchange Commission. Except as described therein, Orion disclaims any obligation to update or revise forward-looking statements, which are made as of today. Reconciliations of certain non-GAAP financial metrics to the nearest GAAP measures are also provided in today's press release. And with that, I will now turn the call over to Orion's CEO, Mr. Mike Jenkins.

Thanks, Bill, and thank you all for joining us today. As highlighted in today's press release, we have had significant developments and progress in quarter 3, yet our revenue performance was disappointing. I believe the actions we have taken over the past year have put Orion in a stronger position for substantially improved performance in fiscal '26 on both top and bottom lines. I will let Per walk you through our Q3 results, and I will focus my remarks on actions we have taken to position Orion for meaningful revenue growth as well as substantial bottom line improvements as we move forward. On the revenue side, over the past few months, we have landed 7 new LED lighting contracts and opportunities with revenue potential of $100 million to $200 million over the next 5 years. This new business is the result of changes we have been making in our sales, marketing, product, and services offerings to better meet customer needs. Building on this success, we are reorganizing our operations to further enhance and focus our go-to-market approaches, which has been resonating with long-term and new customers. We have also continued to work on business process improvements that lower our overall fixed operating costs to reduce our revenue breakeven level and increase the contribution from incremental revenue. This is work that we needed to do as it is important in helping us to manage through the inevitable variability in the timing of large orders. We have also made substantial progress over the past 18 months in improving product and service margins. In our Lighting business, cost engineering, enhancing our plant layout and supply chain strategies have allowed us to redesign products and processes so that we are able to deliver the same high performance but at a lower cost of goods. As a result, we have been able to remove total cost from our manufacturing site. This engineering and product know-how has also helped us produce TritonPro, which is a line of products designed to provide more price-sensitive customers with a competitive product line with strong performance. TritonPro margins are accretive to our overall Lighting margin, considering they do not require a lot of fixed costs since they are produced through a network of contract manufacturers to Orion specifications. As we have discussed at length, margins in our Maintenance business have made a substantial rebound due to strategic pricing and restructuring decisions made last year. Orion's total quarter 3 '25 blended gross margin percentage improved 490 basis points to 29.4%. This is the second-highest quarterly rate in 7 years as a result of all of our work in the above areas. Considering the increase in gross margin as well as reductions to fixed costs, we have reduced Orion's annual breakeven point by at least 20% to between $78 million and $85 million, depending on our revenue mix from approximately $105 million to $115 million over the past 2 years. Progress on our revenue breakeven was reflected in slightly positive quarter 3 adjusted EBITDA. Stepping back to look at larger industry trends, the lighting industry as a whole has faced headwinds due to higher interest rates, a slowdown in new commercial construction projects, and uncertainty around the economy. Despite this backdrop, as I mentioned, Orion has landed a strong base of new projects that we outlined in today's press release. Looking forward, the substantial return on investment, typically 1 to 4 years moving from fluorescent to LED and better light quality that are provided by our LED lighting solutions should continue to make LED retrofit projects compelling capital investments. Adding urgency for LED retrofits is the rollout of mandates that prohibit the sale of fluorescent lighting fixtures and replacement tubes due to the safety and environmental issues they pose. Of particular concern is the danger of mercury utilized in fluorescent tubes and the safety challenges of handling and disposing of them. In addition, there are substantial energy efficiency, maintenance, and illumination benefits from converting to LED lighting. There are now 14 states which have either, or are in the process of adopting, these fluorescent bans. It is important to note that these mandates are fully state-driven and are not tied to federal regulations nor funding. Please go to our website at orionlighting.com for more information regarding these bans. Turning to our Voltrek EV Charging Solutions business. We expect a strong close to fiscal '25 from projects, including some under Eversource Energy's ‘EV Make Ready’ program that were previously expected in quarter 3, '25. Revenue from the EV Charging segment is up 48% year-to-date, and Voltrek, a pioneer in EV Charging Solutions, is well positioned to continue its growth trajectory in fiscal '26. Of course, the prospect of federal funding for EV charging is now unclear as the new administration has sought to halt disbursements under the $5 billion Electric Vehicle Infrastructure Act or NEVI program. It is too early to tell ultimately where the NEVI funding program is going. Importantly, Orion has very little exposure to NEVI-funded projects in our fiscal '26 outlook, though the elimination or reduction of funding tax credits and rebates could impact the plans of some customers. Despite this near-term uncertainty, we remain bullish about our growth prospects in our EV Charging business as evidenced by the value of our pipeline growing sequentially in the quarter. Orion Voltrek is a strong player in the EV charging solutions space with a broad portfolio of successful projects across the country. As a result, we believe we are uniquely positioned to address the EV charging station needs of larger corporate and public sector organizations with large footprints. Even today, there is a very pressing need to build out additional infrastructure to properly support the current installed base of EVs, and that need grows each day as new vehicle shipments continue to expand the installed base of commercial and consumer electric vehicles. Even with reduced federal support, we believe the market opportunity is sufficiently large to continue Voltrek's growth in fiscal '26 and longer term. Whether EVs eventually comprise 25% or 50% or more of all domestic vehicles, the infrastructure to properly support those vehicles will still need to be substantially expanded. Turning to our Electrical Maintenance business. We believe it provides a very solid long-term platform on which to build a growing base of recurring revenue with excellent cross-fertilization potential with LED lighting. We also believe this business will benefit from the increasing complexity, interactivity, and importance of electrical systems, monitoring, and controls. Following our restructuring of this business, we are now in a position to begin adding new customers, and we have closed one significant account, which will begin in Q4 and is expected to grow to $2 million to $5 million per annum. As we often mentioned, our year-to-date maintenance revenue has been impacted by pricing increases that resulted in the intentional loss of a few large unprofitable customers. Importantly, these actions have allowed us to solidify our business and bring our gross margin percentage back into the range that is positively contributing to our company. The gross margin in maintenance rebounded over 2,000 basis points to 26.4% in Q3 '25, up from 6.2% in Q3 '24. In addition, we have begun to win new business from existing and new customers that provides a solid base to grow upon. With that as a backdrop, I'd like to discuss the reorganization of our business that we disclosed in today's release. The purpose of this reorganization is to focus our team and resources to better serve our customers and enhance our revenue and profit opportunities while also working to streamline our operating overhead. We anticipate $1.5 million of further annual cost reductions through targeted staffing eliminations. Also, senior management and the Board have agreed to forgo 10% of their salaries and retainers through the balance of fiscal '25 and until business performance improves. We are reorganizing our 3 business segments into 2 commercial business units or CBUs, that target very different end customer needs. The first unit, Solutions, is focused on developing and executing our LED Lighting, EV Charging, and Maintenance Services business for large and complex corporate, government, and super ESCOs where we provide turnkey solutions as well as to other private sector accounts. The Solutions CBU focuses on combining leading products and technology with services to create a strong value proposition. Services provided include activities like site audits, custom product and systems engineering, installation, commissioning, system maintenance, and overall project management. The second unit, Partners, will focus on accelerating LED lighting and EV charging product sales by catering to the unique needs and dynamics of Orion's distribution partners, including energy service companies or ESCOs and our distributors and agents. These channels require a portfolio of products to meet their needs for levels of efficiencies and price points. To better serve this market, Orion has developed new product lines such as TritonPro that balance smart design, performance, and energy efficiency with more competitive price points. These new products have been well received, and our partners have built a significant mutual pipeline of new projects using TritonPro. Our focus through the new structure is to get even closer with our customers through dedicated teams to discover our customers' unmet and future needs. We will be able to take this insight into our product and services development process to provide greater value and the ability to capture more new business. Orion has already commenced these realignments and expects the new structure to be fully implemented and effective as financial reporting segments as of April 1, 2025. Orion has built a strong platform of very competitive product and service solutions that help our customers meet their energy savings, workplace safety, and sustainability goals. In addition, we deliver the highest levels of lighting and electrical project expertise with elite customer service and delivery. We now have an expanding project pipeline of opportunities across our business, which gives us strong confidence for the coming quarters. Reflecting the impact of the change in timing of new business projects, we have reduced our fiscal '25 revenue outlook to a range of $77 million to $83 million. This outlook implies Q4 '25 revenue of $19 million to $25 million, which would be approximately in line or better than any of our first 3 quarters of this year. This outlook is based on the current business climate, initial revenue expected from large national LED projects as well as significant sequential rebound in Orion's Voltrek EV Charging Solutions business. Due to stronger-than-anticipated new maintenance service opportunities, we now expect fiscal '25 maintenance services revenue to decrease by approximately $2 million to $3 million in fiscal '25 versus our initial expectation of a $4 million to $5 million decline. Looking ahead and considering a growing base of customers and large projects expected to engage over the next several quarters, we believe Orion is well positioned to achieve double-digit revenue growth and positive adjusted EBITDA in fiscal 2026. We plan to provide a more specific fiscal '26 revenue outlook when we report Q4 '25 results in June.

Thanks, Mike. As we reported, our Q3 revenue of $19.6 million was impacted by customer changes in the timing in LED and EV charging project starts as well as reduced activity in the lighting distribution channel, which impacted Orion and the overall industry, partly due to slower new construction and economic uncertainties. Q3 revenue in 2025 was $19.6 million versus $26 million in Q3 '24 and $19.4 million last quarter. The year-over-year comparison was impacted by delays as well as a large Department of Defense project in Europe that had benefited the prior year period. As highlighted in today's press release and Mike's remarks, there are several LED lighting projects that we expect to begin in the coming months that will benefit our fiscal Q4 and 2026 results. Our EV Charging segment, which is up 48% year-to-date, was also impacted by project timing in the quarter with Q3 '25 revenues of $2.4 million versus $2.8 million in Q3 '24. We expect a strong Q4, which will benefit from construction service contracts related to Eversource Energy's EV Make Ready program and a large public school bus EV project for Boston Public Schools. In maintenance, $3.9 million of Q3 revenues were higher than expected, driven by new opportunities with existing customers, though below Q4 '24 revenues due to the intentional roll-off of unprofitable Stay-Lite legacy contracts. Our overall gross profit percentage or gross profit margin increased nearly 500 basis points to 29.4% from 24.5% in Q3 '24. Sequentially, gross margin improved more than 600 basis points from Q2. A large portion of that was due to profitability improvement in maintenance services, as we've discussed. Also, as we've demonstrated, margin improvement in lighting, where gross profit was 30.1% versus 27.4% in Q3 '24, even on lower revenues in the current year period. That improvement is due to both mix and structure. By structure, I mean we've taken steps to lower our manufacturing costs on our base products through reengineering and efficiency efforts in the plant. Mix refers to revenue that includes more sourced product, which carries less fixed cost and more variable cost and is above 30% margin, so it's accretive overall. The spend toward more sourced product is a testament to the strength of our TritonPro line and the strategic decision that we made in 2023 with its launch that expanded our reach and leadership in more value-oriented LED market segments. We expect this mix shift and structural changes to continue to positively impact our lighting margins into the future, which should become even more evident in stronger revenue quarters. On prior calls, we've talked a lot about the gross margin improvement in our Maintenance business, and we said we expect it to reach a normalized level in Q3 '25, more in line with the overall business. We demonstrated this in Q3 with a 26.4% gross margin, which is more in line with where our overall business has been and within the range that we expect for maintenance going forward. Our EV gross margin was 30% in Q3 '25, also very strong. And of course, our gross margins will continue to vary some depending on projects and revenue levels due to fixed costs. Reflecting on the turnaround and maintenance and our overall outlook, we expect Orion's blended gross margin to remain strong in Q4 '25 and sustained through fiscal 2026. Operating expenses decreased 16.9% or $1.4 million to $7 million in Q3 '25 from $8.4 million in Q3 '24 due mainly to lower fixed costs, including employee and compensation-related reductions and a $600,000 reduction in Voltrek earn-out expense accrual. As mentioned previously, Orion has been working hard on process improvement, which enables us to remove inefficiencies and costs from our business. The improvement in gross margin, combined with lower operating expenses led to Orion's Q3 '25 net operating loss improving to $1.5 million or $0.05 per share from $2.3 million or $0.07 per share in Q3 '24. Cash generated from operations was $3.8 million in Q3 '25 due to strong accounts receivable conversion. Year-to-date, we generated $1.3 million of cash in operating activities and paid down $2.5 million under our revolving credit facility, including $1.5 million paid in Q3 '25. Our cash balance increased to $7.5 million in Q3 from $5.2 million at prior year-end. Also, in early Q3, we extended the maturity date of our revolving credit line with Bank of America by 1.5 years from December 2025 to June 2027. Current assets less current liabilities or net working capital was $10.5 million at the close of Q3 '25 compared to $13.1 million last quarter and $16.7 million at year-end. Lower current assets reflect our significant efforts to drive our inventory levels down. Considering our growth expectations and Orion's financial liquidity, we believe we are well positioned to fund our business and growth goals through fiscal '25 and beyond. And now, Olivia, you may begin the Q&A session.

Our first question comes from Eric Stine with Craig-Hallum Capital Group.

Mike and Per, could we start by discussing the pipeline? I want to clarify something. You mentioned 7 new customers and projects worth between $100 million and $200 million. Are these included in your pipeline? Are you suggesting that these could represent potential awards based on your recent announcements, both for maintenance and projects over the last few months? I'm trying to understand if this is business you already have secured or if you still need to finalize those deals. Additionally, you mentioned several large opportunities nearing the final stages of negotiation. I’d like to know what falls into each category.

Yes. Thanks, Eric. Good question. So what we talked about and what we've released is closed-won business. And so those projections are of the closed-won, which means we do believe that we will actualize revenue in that range from $100 million to $200 million over the next 5 years as a result. Separate from that, as you referenced, there are several other large significant opportunities, which are in the final stages of the pipeline, and we hope to make further announcements in the near future.

Got it. If possible, could you provide some insight into the large projects you mentioned and their potential impact on increasing the revenue from $100 million to $200 million? Specifically, how might that be distributed across lighting, charging, and maintenance? Any information would be appreciated.

Sure. I would say that the scale of those opportunities is definitely in the 8 figures annually. That's about as specific as I'm willing to be at this point since they're still in the pipeline and haven't been finalized yet. What we are observing is that these opportunities, both closed and in the pipeline, are coming from a fairly varied customer base. When you review what has already been announced and secured, as detailed in the press release today, you can see sectors like building products retailers, several major ESCO opportunities, one particularly involved in the municipal university schools and hospital market, alongside continued expansion with core customers and a rebound in our Automotive business as we move into fiscal '26. The other projects in the pipeline also encompass some additional sectors.

Got it. Okay. And for my last question, I understand the ongoing frustration regarding project delays. Have you considered any strategies to better anticipate these changes? Perhaps when developing your annual guidance, you could incorporate this insight more effectively? I mention this because such occurrences have been quite common over the past few quarters and even longer.

Certainly. It is frustrating for management when some projects, whether new business or well-planned ones, are delayed due to the customer's timeline or other reasons despite our continued communication. For the fiscal year 2026, we plan to reset our costs and our breakeven point, which we announced in today's release. This will help us remain profitable even if we encounter revenue delays. Our focus is on growing our top line by double digits, given the new business we have secured, while also maintaining tight control over costs and establishing a new breakeven point to ensure profitability.

Our next question coming from the line of Amit Dayal with H.C. Wainwright.

Just following up on Eric's question about the $100 million to $200 million outlook from the backlog side of things. How much of that is exposure to any government contracts or opportunities?

Yes. None of that pipeline is really focused at all on the federal space. As I mentioned earlier, some of it is in the municipal space. But really none of it is tied to federal.

Understood. And then with respect to the inventory, maybe can you share what the inventory is comprised of right now? And is there anything within that, that may be written off as you go through the reorganization process?

No, we have been working very hard on our inventory as a company over the last 18 months and have reduced it substantially. I think we've got a very productive inventory at this point in time, and we're not expecting any significant write-offs as a result of the restructuring.

Understood. And on the maintenance side, how are you sort of targeting new customer wins? Are you using maybe outside help for this? Or is it just an internal sales force that is trying to go and get deals done to build that customer base out?

Yes. We're always looking to use partners and kind of network for opportunities. But the ones that have been announced thus far have been internally generated. Certainly, we've bolstered our sales team with some experienced people from the industry, and those individuals have helped provide some new opportunities to us. We think that we've got the right infrastructure, capabilities, and capacity now to leverage for new business. And now that we've solidified the base, we are profitable. I think we're in a good position to start moving forward with new business.

Our next question coming from the line of Gowshi Sri with Singular Research.

Can you hear me?

Yes.

All right. On the $100 million to $200 million revenue potential, what's the assumptions that are driving the low end to the high end? And how much of that is pricing and how much of that is EV growth?

Sure. In a range like that, we have timing for these projects and new customers, which obviously have different phases. These initiatives are quite large and involve various rollout assumptions. We aim to be clear that there are numerous potential outcomes in new business that we don't always have control over. Therefore, we are attempting to better illustrate what we believe this range could be. We believe this is a realistic range at this time. Regarding electric vehicles, many of these opportunities are more focused on the lighting aspect. As I mentioned earlier, we have sequentially increased our pipeline of electric vehicle opportunities quarter-over-quarter. Despite the ongoing challenges in the federal sector, we are continuing to grow our pipeline. We see promising growth opportunities in that segment as well, but they are not included in the $100 million to $200 million range.

In terms of the project delays, I understand you've indicated that many of these issues stem from macro factors, including customer readiness and funding availability. Looking ahead, is there any conversation about pricing adjustments or enhanced services to encourage clients to move forward with their projects?

Yes. Most of our projects have a very good return on investment for customers, which motivates them. Typically, the factors that cause delays are not usually linked to our pricing. Financial aspects can play a role, along with broader macroeconomic issues or internal business circumstances. Consequently, customers may reallocate their capital and postpone a project. There are many reasons for these delays. We continually assess opportunities and, when there are delays, we investigate their causes and determine if we can address them. This includes exploring financing options through third-party partners we collaborate with regularly.

Okay. And can you give us any color on that $5 million project with the automotive OEMs that you guys have mentioned in your press release?

Yes. We have two main OEMs that we collaborate with extensively. We regularly update their facilities, typically every seven years, and we are noticing improvements in this cycle. Additionally, one of these OEMs is particularly focused on the upcoming fluorescent bans, which is accelerating their efforts to convert any remaining areas to LED lighting.

Okay. And on the final question, with the current political climate as it is, I know you have had a few federal government DoD-like projects. Is there any color on that front in terms of engagement in terms of the change in the policy?

Yes. I think we need to wait and see how this develops. It's clearly evolving quickly. As I mentioned earlier, we don't see any direct impacts from NEVI or federal funding on our projects, and this should not affect our fiscal '26 outlook. We did experience an impact with one project related to a government entity that was placed on hold due to a reorganization within that entity, although it was not due to federal funding. This project was worth seven figures. That's the only impact we've encountered, which is unfortunate, but we do not foresee any issues moving forward. Additionally, we continue to see great opportunities. We've collaborated with the Department of Defense and other government entities on lighting projects, and we expect those projects to progress without any negative effects.

And our next question coming from the line of Bill Dezellem with Tieton Capital Management.

First of all, relative to the new business unit structure that you're doing, would you please walk us through the practical benefits of that new structure and what that ultimately will accomplish from the customer perspective and what the customer will see that's different?

Sure. The new structure aligns our sales and demand creation teams with execution capabilities, establishing a clear distinction between our Solutions or Turnkey business and our Partner business. Historically, our organization has been more functionally oriented, meaning one sales team handled both partner and turnkey opportunities. Our goal is to create strong alignment between the front end of our business and the operational side so that we are closely connected with our customers. This allows us to understand their needs better and to develop varied strategies for product lines, pricing, promotions, and service offerings. With this approach, we have a clear vision of what our customers need and how to effectively sell and execute our offerings.

And Mike, how does that differ from your current structure or the structure before you started implementing those changes?

Sure. So again, this is primarily on the front side of our business and particularly our sales organization has, again, had the ability to focus on a wide variety of opportunities, whether they be ESCOs or distribution or solutions-oriented. What this does is it basically creates clean lines for our sales and go-to-market approach that everybody is focused on either the partner side of the business or the solution side. So again, going back to TritonPro as an example, one of the things that we were hearing loud and clear from our partners was that the market was shifting. They needed additional competitive offerings, which we responded to. I think we did that quite well. And that's driven some growth and opportunities on that side of the business. And that's something that if we had just focused on the solutions side, we probably would have got there, but it probably would have been later than having that insight coming from the ESCOs and then reacting to it. So I think moving forward, this will allow us to be even faster in terms of reacting to market needs and be very tailored in our offering to them.

And are you finding with your salespeople that some of them are just better suited, whether it's their genetic makeup or their relationships that they have for direct business or through ESCOs?

Absolutely, great question, Bill. Yes, some individuals do have an advantage based on their experience and ability to manage things, as there is a distinction between solutions-based service-oriented selling and working with partners. Therefore, we are aligning our team according to their capabilities, experience, and aptitude for one of these two segments as we move forward.

Maybe taking this one step further, it appears that you are winning new business at a faster rate. So congratulations on that success. The question is why? And how repeatable is that? And maybe tied into that question is, to what degree have you already been at some level, your salespeople been kind of falling into line of focused on the OEMs or focused on the partners? And as a result, that's actually what's leading to this success at closing business?

Yes. We have added some new salespeople, as I referenced before, some other people from the industry. I think they've brought us some great skills, talents, and accounts that we could go after and win. As often is the case, it's not one single thing that we do. It's a combination or accumulation of actions that we've been taking, both on the marketing side of the business and the sales side of the business that is allowing us to pick up these new accounts. Certainly, moving forward, we see the value of focus, and that's really what we want to do. And we believe through that focus in the organization, we'll continue to see this level of momentum and acceleration.

Great. And then additionally, relative to the incentives, and I guess this question is most focused on the lighting side of the business. The incentives that your customers are receiving, are those coming from the federal level, the state level, the utilities themselves? Where are the predominant originators of the incentives?

Great question. It's primarily the utilities, local utilities, which are providing the vast majority of lighting incentives.

And so all of the things that we're hearing in the news relative to the federal government and cutting back really has no impact. This is all tied to the utilities trying to manage the additional watts that they need to produce as time goes forward?

Absolutely. Yes, well said.

Congrats on the margin improvement.

Thanks, Bill.

And our next question comes from Andrew Shapiro with Lawndale Capital Management.

Just 2 follow-up questions with respect to your press release. One was the management and Board were taking a 10% salary and retainer cut. Can you clarify, is this a deferral and thus accrual or a complete give up or give back?

Yes. We're foregoing that for the balance of this year and then until business performance improves in general. So we're foregoing it.

Can you clarify the word forgo? Again, is it a giveback? Or is it deferral and accrual, meaning the cash savings only for the time being?

It's a give up.

We will not be accruing funds for the compensation.

Okay. And then I appreciate you sharing the pain. And can you update us on the company's NASDAQ listing status, the timeline and various milestones and where we're at on the clock?

We are currently in the initial 180-day period in which we can regain compliance, which ends around mid-March, specifically March 19. If we do not achieve compliance by that date, we can request an additional 180-day extension. Should we not be compliant by mid-March, I expect that we will apply for this extension. Our expectation is that through effective execution of our plan, we should regain compliance either within this period or the following one.

And in an application for extension, typically, you have to present a roadmap or a plan for what the company would do to regain compliance. Is the thought, as you just described, solely based on execution of said plan? Or are there other options that you are preparing to or would be prepared to put on the table to maintain said listing?

That's something that is subject to further evaluation as we move toward that timeframe. But if there are other things that we believe we need to do, we would include that in that application.

Okay. And when does the company's annual meeting typically take place and when you'd have to decide whether you're putting forward a reverse split or some other kind of shareholder vote action?

Not sure I heard that quite right, but if the question was when our typical annual meeting timing is, that's usually in early August of each year.

Okay. In the next window, if you consider a reverse stock split, which may not be the best solution, but it is an option, that would be the time to decide if you want to put the matter up for a shareholder vote.

Yes, I believe that's true.

This concludes our Q&A session. I'll now turn the conference back to Mike Jenkins for closing remarks.

Thank you all again for joining us today. We look forward to updating investors on our fiscal 2025 fourth quarter call, and we hope to see or speak with you at upcoming investor conferences, which we will announce separately via press release. Please contact our Investor Relations team for any additional questions regarding today's call or to schedule a meeting. Their contact information is in today's press release. Once again, thank you for attending our call.

Thank you. That concludes today's conference call. Thank you all for your participation. You may now disconnect.