Cognex Q4 2024 Earnings Report

Cognex EPS Results

• Actual EPS: $0.14
• Consensus EPS: $0.15
• Beat/Miss: Missed by -$0.01
• One Year Ago EPS: N/A

Cognex Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $220.68 million
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Cognex Announcement Details

• Quarter: Q4 2024
• Date: 2/12/2025
• Time: After Market Closes
• Conference Call Date: Thursday, February 13, 2025
• Conference Call Time: 8:30AM ET

Cognex (NASDAQ:CGNX) provides machine vision products that capture and analyze visual information to automate manufacturing and distribution tasks worldwide. Its machine vision products are used to automate the manufacturing and tracking of discrete items, including mobile phones, electric vehicle batteries, and e-commerce packages by locating, identifying, inspecting, and measuring them during the manufacturing or distribution process. The company offers VisionPro software, a suite of patented vision tools for advanced programming; QuickBuild that allows customers to build vision applications with a graphical, flowchart-based programming interface; and Cognex deep learning vision software. It also provides a range of inspection tasks, including part location, identification, measurement, assembly verification, and robotic guidance; vision sensors for vision applications, such as checking the presence and size of parts; and the In-Sight product line of vision systems and sensors. In addition, the company offers DataMan, an image-based barcode readers and barcode verifiers. It sells its products to automotive, logistics, consumer electronics, medical-related, semiconductor, consumer products, food and beverage, and others, as well as through a network of distributors and integrators. The company was incorporated in 1981 and is headquartered in Natick, Massachusetts.

Cognex Q4 2024 Earnings Call Transcript

Presentation

[Operator]

Greetings and welcome to Cognex Fourth Quarter and Full Year twenty twenty four Earnings Conference Call. At this time, all participants are on a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Nathan McKern, Head of Investor Relations.

[Operator]

Thank you. You may begin.

[Nathan McCurren, Head Of Investor Relations at Cognex]

Thank you, operator. Good morning, everyone, and thank you for joining us. Our press release was published yesterday after market close and our annual report on Form 10 K for 2024 was filed this morning. The press release, earnings presentation and 10 K are available on the Investor Relations section of our website. Both our published materials and the call today will reference non GAAP measures.

[Nathan McCurren, Head Of Investor Relations at Cognex]

You can find a reconciliation of certain items from GAAP to non GAAP in our press release and earnings presentation. Any forward looking statements we made in the press release, the accompanying presentation posted to our website or any that we may make during this call are based upon information that we believe to be true as of today. Our actual results may differ from our projections due to the risks and uncertainties that are described in our SEC filings, including our most recent Form 10 ks. On today's call, Rob Willett, Agnix's President and CEO, will discuss end market trends and provide an update on our strategic initiatives. Dennis Fair, Cognex's CFO, will discuss our fourth quarter financial results and will conclude with our outlook.

[Nathan McCurren, Head Of Investor Relations at Cognex]

With that, I'll turn the call over to Rob.

[Robert Willett, President & Chief Executive Officer at Cognex]

Thanks, Nathan. Hello, everyone, and thank you for joining us. We began 2024 with the strategic priorities of infusing AI into more of our products and tools, transforming and expanding our sales force and integrating Moratex, our largest acquisition in company history. I am pleased with the progress we made against these strategic priorities in 2024. We expanded our portfolio of machine vision products powered by world class AI.

[Robert Willett, President & Chief Executive Officer at Cognex]

A couple of highlights include the industry's first AI enabled three d smart camera, the Insight L38, and the addition of the modular vision tunnel portfolio featuring the powerful DataMan three eighty barcode reader that uses improved decoding optimized for logistics applications to minimize footprint, maximize depth of field, and read the smallest codes. We successfully executed our sales transformation, deploying a new type of SalesNoid to broaden our sales reach to customers we have not traditionally served. And we successfully integrated our largest ever acquisition, Maritex, which gives us a more complete machine vision solution and contributes positively to our bottom line. This transaction was accretive to adjusted EPS in 2024, which led to a slight increase in adjusted EPS for the year in an otherwise soft market. In 2024, our logistics and semiconductor businesses gained momentum, but conditions across our broader factory automation business remained challenging.

[Robert Willett, President & Chief Executive Officer at Cognex]

Most of these markets stabilized throughout the year. Despite a slight improvement in relevant macro leading indicators such as PMI, we still characterize our core factory automation markets as soft but stable for now. The exception continues to be automotive, where we saw a pronounced step down in 2024. Coming into the year, we expected automotive to grow, helped by significant EV battery spending. But this investment dropped off throughout the year, leading automotive to be our weakest end market in 2024.

[Robert Willett, President & Chief Executive Officer at Cognex]

We continue to see uncertainty in auto as we begin 2025. These mixed market dynamics led to overall revenue growth of 9% or 1% excluding Moritex for the full year. Throughout 2024, while we continued to invest in long term growth initiatives, we stayed disciplined in our approach to discretionary spending and thoughtful about hiring. I now want to provide you with a more detailed update on our strategic initiatives. We are seeing rapid changes in technology with powerful chips accelerating AI innovation.

[Robert Willett, President & Chief Executive Officer at Cognex]

For industrial machine vision, this means moving beyond the world of rules based algorithms towards a more sophisticated suite of powerful artificial intelligence tools. Transformer models are overtaking convolutional neural networks as the foundation of deep learning. As this shift accelerates, customers will need significantly less data to train and configure our products and will be able to ramp up and scale production faster. This will allow Machine Vision to address more applications and reach more customers. Cognex is defining the leading edge of this shift in industrial machine vision technology by launching industry leading products that leverage AI to solve customers' problems.

[Robert Willett, President & Chief Executive Officer at Cognex]

Our new products address the full spectrum of machine vision applications. At one end of the spectrum, new AI allows us to excel at the most complex and difficult inspection tasks, while at the other, it allows us to develop products that are easy to deploy and easy to use. In December, we launched VisionPRO Deep Learning four point zero, illustrated on page four of our presentation. This powerful software, designed to tackle the most difficult problems in machine vision, is Cognex's first ever product to utilize transformer models. Transformer technology, which forms the core of sophisticated large language models such as CHET GPT, can help to vastly reduce the number of images required to train and implement a machine vision model.

[Robert Willett, President & Chief Executive Officer at Cognex]

VisionPRO Deep Learning four point zero's signature View Sample mode achieves high levels of accuracy on some of the most sophisticated inspections after training on as few as 10 images. Previous versions would have required hundreds of images to train a vision model with such capability. This is very valuable for customers who require high accuracy but do not have large training data sets, which is often the case as they scale up their production. It is also important for customers whose production cycles are only a few months long and therefore require effective models to be ready in weeks. Few sample mode saves customers time collecting, labeling, and managing image data, which has historically been a costly process.

[Robert Willett, President & Chief Executive Officer at Cognex]

We have also expanded our Data Man series to address more applications for customers looking for easy to use products. As illustrated on page five, our new Data Man series makes identifying and tracking parts and packages across a facility easier than ever. Regardless of industry, code quality, or application complexity, embedded AI in these next generation readers helps deliver exceptional read rates for reliable performance at every stage of production. Our latest DataMan products are examples of the products that allow us to get our highly advanced, powerful technology into the hands of customers with less machine vision experience. We continue to tap into this broader customer base by investing to transform and expand sales coverage.

[Robert Willett, President & Chief Executive Officer at Cognex]

Moving to Page six of the earnings presentation, We are enthusiastic about the progress of our sales transformation in 2024. Our first class of new sales noise continued to ramp with Q4 representing their highest quarter of bookings to date, leading to over 3,000 new customers acquired by this group in 2024. These entry level sales noise are also continuing to gain strong traction in referrals of more complex vision systems to our more technical and advanced salesnoides. The second cohort of new salesnoides entered the field recently, and we expect this to further grow our customer base in 2025. We remain confident in the long term value of our sales transformation strategy, allowing us to serve more customers with easy to use products.

[Robert Willett, President & Chief Executive Officer at Cognex]

We're excited to continue this strategy and introduce a new cohort of sales noise each year. As we plan for future years, we will be flexible about cohort sizes and be responsive to market conditions. Turning now to what we are seeing across our end markets, which you will find on Page seven of the earnings presentation. I will discuss the end market results for the year, excluding the contribution of Maritex. End markets have been mixed as we have seen both continued softness as well as pockets of growth.

[Robert Willett, President & Chief Executive Officer at Cognex]

Starting with logistics, revenue grew 20% in 2024. We continue to see broad momentum in logistics from global e commerce leaders as well as regional e commerce, retail and parcel and post providers. Market growth has improved as large e commerce players return to capacity expansion and broader logistics remains an underpenetrated market. We believe we also gained share with recent product innovations, including the success of the modular Vision Tunnel and DataMan three eighty launched last year. Moving on to automotive.

[Robert Willett, President & Chief Executive Officer at Cognex]

Revenue in automotive was down 14% year on year. We continue to see declines in EV battery investment and tentativeness in large capital projects across the broader automotive business. Coming into the year, we expected strong growth in EV battery investment and for it to be one of our largest growth engines. But as the year progressed, we saw delays, reductions and cancellations of EV battery projects. We still expect EV battery to be a long term growth driver but likely not in 2025.

[Robert Willett, President & Chief Executive Officer at Cognex]

Consumer electronics revenue was down 5% year on year as smartphone design changes remained limited, and we saw conservative CapEx spending across the market. Consumer electronics has positive long term trends. Currently, our expectations for near term be Lastly, Semi is continuing to build with significant year on year growth, albeit off a low 2023 base. Growth is widespread across Semi with investment increases from major machine builders, but we have seen strong demand driven by high bandwidth memory chip investments. As we kick off 2025, we expect momentum to continue in logistics and semi, automotive to remain weak and other factory automation growth to be relatively in line with macro indicators such as PMI.

[Robert Willett, President & Chief Executive Officer at Cognex]

We continue to see disruptive trends playing out in our markets. AI technology is making our products more accessible to an increasing number of customers and applications. We lead the industry in making machine vision technology usable by industrial customers at scale. With this, we can automate more inspection tasks and grow the machine vision market, both by solving more of our sophisticated customers' most challenging problems, but also by making our powerful technology accessible for those less experienced in automation. Let me now hand it over to Dennis to walk you through the financial results and the outlook for the first quarter.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Thank you, Rob. Our quarterly financial highlights can be found on Page eight of our earnings presentation posted to our investor website yesterday. Fourth quarter revenue of $230,000,000 finished at the high end of our guidance range and increased 17% year on year. Excluding Moritex, revenue grew by 12%. As we have now passed the one year anniversary of the close of our Moritex acquisition, I will note that this will be the last quarter we speak to revenue trends excluding this part of our business.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

From a geographic viewpoint excluding Moritex, year on year revenue grew double digits in both The Americas, led by continued logistics strength and compounded by accelerated demand in the quarter and in other Asia, led by semiconductor. Europe declined slightly due to weaker automotive spending. Year on year revenue growth in the quarter was strongest in Greater China, driven by project timing in consumer electronics as well as an easy year ago comparison. While China revenue has grown year on year the past two quarters, we remain cautious about the overall outlook for this market, which continues to see both significant uncertainty and heightened competitive pressure. Turning to margins.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Adjusted gross margin was 69.4% in Q4, down 130 basis points from 70.7% a year ago, driven by more attacks, negative mix from higher logistics revenue and to a lesser extent, pricing headwinds, most pronounced in China. Adjusted operating expenses increased 3% year on year in the quarter. The increase was driven by more attacks as well as investment in our sales force transformation and expansion. As a result of reallocation and adjustment to our employee base, we incurred $3,000,000 of reorganization costs in the quarter that are excluded from our non GAAP metrics. Even with our investment and sales force expansion, ending headcount for this year was 3% below year ago levels, and we continue to focus on tight cost management.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Adjusted EBITDA margin was 18.5% in Q4, above the high end of our guidance and up nearly six percentage points from 12.6% a year ago. Revenue growth and tight cost management drove high incremental EBITDA margin despite gross margin pressure. Diluted earnings per share on a GAAP basis was $0.16 up from $0.07 in Q4 of twenty twenty three. Adjusted diluted EPS was 0.2 up from $0.11 year on year. Both increases were due to higher revenue and higher margins.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Driven by working capital optimization, we delivered strong free cash flow for the second quarter in a row in Q4, totaling $49,000,000 compared to 7,000,000 in Q4 of twenty twenty three. Cognex returned $57,000,000 to shareholders in the quarter. $43,000,000 of share repurchase was our highest quarterly total since Q1 twenty twenty two, and we intend to continue to be opportunistic with our stock buyback. I will also briefly cover our full year 2024 results, which can be found on Page nine of our presentation. 2024 revenue of $915,000,000 grew 9% year on year or 1% excluding MoraTax.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Geographically, for the full year excluding Moray tax, other Asia delivered the highest revenue growth due to semi. In addition, The Americas grew moderately. Europe declined slightly and China declined more materially in the year. Adjusted gross margin was 69.3% in 2024, down 3.2 percentage points due to Maritex, unfavorable mix and to a lesser extent, pricing. For the full year, adjusted operating expense increased 6%, driven primarily by Moritex as well as our sales force transformation efforts.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Adjusted EBITDA margin declined 140 basis points to 17.1% in 2024 due to lower gross margins and higher operating expense associated with our sales transformation. GAAP diluted earnings per share of $0.62 declined 6% year on year, partially due to a higher effective tax rate. Adjusted diluted EPS of $0.74 was up from $0.73 in 2023 as the accretion from Orytec offset softness of factory automation for the full year. Total free cash flow in 2024 was $134,000,000 representing 105% conversion of adjusted net income. We returned 119,000,000 to our shareholders in the year and ended the year with $587,000,000 in cash and investments and no debt.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

I will now turn to our outlook for the first quarter on Page 10 of our presentation. In the first quarter, we expect revenue between $200,000,000 and $220,000,000 This range continues to be reflective of a mixed and volatile macro backdrop. At the midpoint, this represents revenue line with Q1 twenty twenty four, reflecting our expectation of continued growth in logistics and semiconductor offset by weaker automotive and an approximately $5,000,000 FX headwind. The expected sequential step down is driven by the acceleration in demand from customers in Q4 and an anticipated $4,000,000 FX headwind in the first quarter. We also expect adjusted gross margin to remain in the high 60% range.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Sequentially, mix is expected to be a slight headwind. Expect adjusted EBITDA margin between 1215%. The midpoint of this range represents 150 basis point increase year on year driven by operating leverage and operating expense discipline. Lastly, we're excited to hold our Cognex Investor Day this year on June 9 and June 10 at our Boston area headquarters, and we hope to see you there. Now we will open the call for questions.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Operator, please go ahead.

[Operator]

Thank you. The floor is now open for questions. Thank you. Today's first question is coming from Damian Karas with UBS. Please go ahead.

[Damian Karas, Executive Director at UBS Group]

Hey, good morning, everyone.

[Robert Willett, President & Chief Executive Officer at Cognex]

Good morning, Damian. Good morning.

[Damian Karas, Executive Director at UBS Group]

Yes. Thanks for all the color around the end market. Rob, I wanted to ask you about autos. I know you've talked in the past about this being the worst market environment you've ever experienced in your career. And I know you expect autos to also continue to be your weakest market this year.

[Damian Karas, Executive Director at UBS Group]

But what's your assessment on, you know, how much lower that customer spend could possibly go from here? I mean, the business segment was down, you know, 14, in 2024. Are you kind of thinking like double digit declines again in 2025 or should, you know, we'd be thinking much more modest declines from here?

[Robert Willett, President & Chief Executive Officer at Cognex]

Well, Damian, I think you paint the picture well is that, you know, it was a very, very, very tough year, last year for automotive and our business there in automotive. We entered the year very enthusiastic about what we saw going on in EV and EV battery manufacturing. And to give you a sense of the magnitude of that, I think coming in, we had we're progressive at Cognex. We had stretch goals to really drive a lot of business into EV battery where we have just some great technology. And I think where we ended up relative to where we came on was on the order of $50,000,000 delta.

[Robert Willett, President & Chief Executive Officer at Cognex]

So that was kind of the most difficult thing that we encountered coming into the year. And obviously, that continued as the year went along. Now we think it's going to continue to be a bad year for automotive, but I don't think one on the order of decline that we saw in 2024. There are some reasons to be optimistic about automotive, right? We do great things in automotive when EV battery comes back, when capacity is more utilized and investment returns.

[Robert Willett, President & Chief Executive Officer at Cognex]

And what we're able to do in that space is very good. And certainly, Cognex's technology in the area of sensors on the car, electronics in the car and some of our new technology, what it can do in inspection in the cars, are exciting growth areas for us. And we have a sense that investment might start to return to that market in 2026, which then might lead to sort of a pickup for business for us later in the year. But we don't give full year guidance. We're not optimistic that we're going to see a good year, but I'm hoping that the time of serious decline for us in automotive is over.

[Damian Karas, Executive Director at UBS Group]

That's really helpful. And then I wanted to ask you about consumer electronics, which was down for the second year in a row in 2024. And I know you said you'll have better insight, when the second quarter earnings comes around. But I wanted to ask you, your slides you mentioned kind of limited change to form factors. What's your sense for that aspect this coming year?

[Damian Karas, Executive Director at UBS Group]

Do you think that there should be more consumer electronics product changes this coming year compared to the past few years?

[Robert Willett, President & Chief Executive Officer at Cognex]

So,

[Robert Willett, President & Chief Executive Officer at Cognex]

consumer electronics revenue fell 5% for Cognex last year, excluding Maritex. That said, it did grow in the back half, right? So due to project timing and some strength that we saw coming. It's really difficult and too early to call kind of Cognex's year in electronics, and I will give you more color on that at our next earnings call. There were reasons that we feel confident that in the long run consumer electronics will be a great growth market for us and will continue to be.

[Robert Willett, President & Chief Executive Officer at Cognex]

The issue is always on when do these things occur. There are a lot of great new features planned, a lot of innovation coming, whether it's in smartphones or in wearable devices or in other electronics such as augmented reality, virtual reality type technology that I think many of our customers are working hard to try to bring to market. And if and when those are successful and need to be manufactured on a massive scale, I'm very confident that companies will turn to Cognex to help them do that. There's also a lot of human inspection going on and huge amounts of human inspection going on in consumer electronics manufacturing. And if I refer you to some of the comments I made in my prepared remarks earlier on newer technology, particularly transformer technology, allows us to meet the needs of some of those customers very well by allowing them to implement our technology quickly, and to get great results, which make the payback much, much faster.

[Robert Willett, President & Chief Executive Officer at Cognex]

To give you a little context of that, if you think of electronics, often it's a very, very rapid scaling up in a relatively short period of manufacturing at huge scale. So this technology in that market, I think, can be very, very valuable and I think is already being seen to be so by some of our customers in the space. So that's kind of the overview. But to give you a direct Oncideo question, too soon to say let's regroup here in about thirteen weeks.

[Damian Karas, Executive Director at UBS Group]

Understood. Really appreciate your thoughts. Best of luck out there.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Thank you.

[Operator]

Thank you. Ladies and gentlemen, due to the number of callers for today, we are asking you to please limit yourself to one question and one related follow-up if needed. The next question is coming from Tommy Moll of Stephens. Please go ahead.

[Tommy Moll, Managing Director at Stephens Inc]

Good morning and thank you for taking my questions.

[Robert Willett, President & Chief Executive Officer at Cognex]

Hey, Tommy. Hey, Tommy.

[Tommy Moll, Managing Director at Stephens Inc]

Rob, I want to start on logistics and ask what insight you can provide there on the breadth of the strength, whether that's in terms of the geographies, the sub verticals, I'm thinking e commerce versus parcel perhaps, and then the durability of this strength. I mean, there were multiple quarters there where, I guess, we were in an absorption phase for a lot of the capacity built out during the pandemic. Does it feel like we're solidly back into a period where we need more capacity? Or how would you situate us?

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes, Tommy, I think you're right in pointing out that we saw our logistics business peak in 2021 where there was huge, huge investment and then we've been through a period of absorbing that investment. And then we're now back to a period of growth. Logistics business grew 20 year on year last year with strength really across pretty much everywhere, right, U. S, Europe, other Asia. And then as we look in terms of customer tiers, I would say we made good progress in base logistics, seeing some nice growth in that space.

[Robert Willett, President & Chief Executive Officer at Cognex]

We've made great progress with very large e commerce players. And then as you might expect, there's sort of a group more large customers, some of whom didn't grow with us last year and others of them did. Specifically in The U. S, a couple of customers who I think are struggling with their own retail supply chain and execution of various things, so didn't put up growth. But that's those are really very few exceptions to what is a very broad and underlying return to growth.

[Robert Willett, President & Chief Executive Officer at Cognex]

We're positive, very positive about our logistics business and what we're seeing happening. We do see more capacity being added. We do see a lot of technology being invested in this industry, whether it is vision technology and certainly beyond barcode reading, which is a very difficult thing. We do very well, but there's much, much more to be done and we're seeing more and more traction with that. New customer activity is strong.

[Robert Willett, President & Chief Executive Officer at Cognex]

We're bringing more data management with our Edge Intelligence platform to this space. And then as you rightly note, the parcel and post sector is an area we see growth in. I did spend a lot of last week in Europe visiting a lot of parcel and post businesses in that space. I would say they're not overly enthusiastic about the investment environment in parcel and post currently, but I don't think that is going to be a headwind to our opportunity to grow in that space. These are really newer customers for us, us newer technology.

[Robert Willett, President & Chief Executive Officer at Cognex]

So we're coming off a low base and we have a lot to offer. But it's worth keeping in mind some of those possible and host companies have five year capital spending plans that we're we've been starting to muscle in on now for a number of years and will play out, I think, over time. Another thing to point out, of course, is geographic expansion is exciting for us. The highest

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

growth

[Robert Willett, President & Chief Executive Officer at Cognex]

rates we see and would expect to see are markets outside The U. S. Where we have strong penetration. It's really more in markets where they're really starting to really drive e commerce fulfillment and spend significantly on a consumer base that's becoming wealthier and spending more money online. And I'm thinking of markets like India and Indonesia where we're making some great progress.

[Tommy Moll, Managing Director at Stephens Inc]

Thank you, Rob. As a follow-up, and perhaps this is for Dennis, I wanted to ask about what you would highlight for us in terms of OpEx discipline, Dennis? So you've sketched the contours previously on the level of investment for the emerging customer initiative. So I'm thinking elsewhere in the OpEx budget. What can you highlight us whether quantifying or just speaking qualitatively about a philosophy on cost management there?

[Tommy Moll, Managing Director at Stephens Inc]

Thank you.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Yes. No, absolutely happy to do that. I think, as we said in our prepared remarks, we're very focused on tight cost management and keep on looking for areas where we can drive efficiency throughout the organization. And I think a positive thing I really would like to highlight is that we invested successfully emerging customer initiative into the sales transformation last year. But at the same time, our OpEx year over year for the full year grew by 6% and revenue grew 9%.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

So that means OpEx growth was below the revenue growth in 2024. And maybe to help you think a bit about 2025, what we expect is that we will see the OpEx growth also below the revenue growth in 2025.

[Tommy Moll, Managing Director at Stephens Inc]

Thank you, Dennis. I'll turn it back.

[Operator]

Thank you. The next question is coming from Andrew Buscaglia of BNP Paribas. Please go ahead.

[Andrew Buscaglia, Senior Analyst at BNP Paribas]

Hey, good morning guys.

[Robert Willett, President & Chief Executive Officer at Cognex]

Good morning, Andrew.

[Andrew Buscaglia, Senior Analyst at BNP Paribas]

Yes, I just want to get

[Andrew Buscaglia, Senior Analyst at BNP Paribas]

an update into year end on the emerging customer initiative. In terms of your expectations, it seems like it's going well. And do you care to provide any context around incremental revenue from the strategy going forward maybe in 2025?

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes, thanks. So, yes, I think you characterized it well. This has been a major initiative for Cognix. We've onboarded and got to improve the productivity of a large first cohort of emerging customer salespeople. Their performance in Q4, I think, was in line or better than what we had expected and communicated to you at the last call.

[Robert Willett, President & Chief Executive Officer at Cognex]

They've completed over 80,000 customer visits in 2024, adding over 3,000 customers, achieving bookings rate of around $1,000,000 a week, and then referring significant business to the rest of our sales team that's turning into larger and more sophisticated opportunities for customers. So we're really starting to see much better penetration of the market, but this is just the beginning, right? And we hired a second cohort as we went through last year, and they're now entering the field. And they're going to really help us expand our sales coverage. So I think we can sort of be cut and pasting the numbers we saw with the first cohort, but hopefully doing better because we're getting better and we're understanding how to do this more.

[Robert Willett, President & Chief Executive Officer at Cognex]

And then I would say, and I think as I communicated, we've adjusted how we're managing them and what we're doing based on what we've learned. And so they're better integrated with our existing sales force now and so better able to cover accounts, some larger accounts where we've been really underpenetrated. They're making more calls on different customer profiles within those large accounts. And then we're also giving them really great new technology. And I think the best example would be the DataMan two ninety and three ninety series that is now in their hands great AI technology that's easy to sell and easy to use.

[Robert Willett, President & Chief Executive Officer at Cognex]

And the sales force was designed with technology like that in mind. So that's our playbook that we will continue to iterate on with as we go through future cohorts. I think in terms of other things, the business that we're winning has over 75% gross margin. So it's again as we expected in that regard. Then, yes, so you asked about 2025 and I think we're going to see that continue, our progress continue and we've got the metrics and the way to manage it.

[Robert Willett, President & Chief Executive Officer at Cognex]

And we continue to be pleased.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

And maybe just to add on that to your specific question on the incremental side, right? We've been talking in the last earnings call and Rob said also just before that we really integrated that new sales noise, this entry level sales noise into the larger sales organization and let them go to also to existing customers. In that regard, we're not really able to give you like a number here is what is incremental. Like Rob said, we're tracking their bookings metrics and other sales efficiency KPIs very closely. But just that one particular question, we just can't answer you in that way.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

So I hope that gives you a bit more color to that as well.

[Andrew Buscaglia, Senior Analyst at BNP Paribas]

Okay. And what are the you guided to gross margins in the high 60s. And what are the biggest levers there that could provide some tailwind to margins going above 70% again? Is it really just volume coming back or can this emerging customer initiative have an impact in 2025 on gross margins already?

[Robert Willett, President & Chief Executive Officer at Cognex]

I'll kick off at a high level, but then I'll throw it to Dennis to give you more detail. So, the wonder of Cognex is implementing great technology to factory automation and logistics. We've got a lot of great technology coming and the DataMed two ninety is an example of that for sure. And then all the sales force that we have now in the field making tens of thousands of sales calls to sell. It should be a tailwind for us as we move forward.

[Robert Willett, President & Chief Executive Officer at Cognex]

And then there is certainly a volume story where we've seen volumes not growing anywhere near our expectations over the last few years. We've built an infrastructure ready to supply a much larger business. And as that business comes and as markets recover, certainly the fall through on incremental revenue should be high.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Right. And we guided for the first quarter to the high 60s, so pretty much in line to what we have guided previously, right? So in the near term, there's certainly some effects that we have strong growth in logistics, which typically is slightly dilutive to the gross margins. So there's a bit of a mixed headwind on that side. Certainly, the growth in logistics has a fantastic flow through to the bottom line, right?

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

You have seen if you look back at Q4, it's coming out at the high end of the revenue range. We had a nice earning speed from that regard. If you think about the logistics impact to the total P and L, very positive on the bottom line, but certainly in the near, it's a slight headwind towards gross margin. But then as Rob said, in the long term, the sales transformation, sales expansion of coverage is a nice measure to bring up gross margin with the incremental or the accretive gross margin we are getting from that initiative. We have strong leverage also in terms of using the infrastructure.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

We have new NPIs, right, we talked in the prepared remarks about like the DM290, for example, that product family. So they're really areas where we can drive gross margin increases and that's really what we'll be focused on in the mid to long term.

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes. Thank you.

[Operator]

Thank you. The next question is coming from Jamie Cook of Truist Securities. Please go ahead.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Hi, good morning. I guess two questions. One, Rob, just on the total market serve, the $6,500,000,000 that you guys have put out there. Just wondering, understanding you probably still feel comfortable with that number. I'm just wondering if perhaps as you're thinking going forward, do we pivot which end markets we want to focus on, perhaps markets that are less cyclical like automotive or consumer electronics may be focusing more on medical or other markets so that I just get your sales over time can be less cyclical versus some of the markets that you focus on.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

So wondering if it will be a pivot there over time. And then I guess my second question, obviously you're still sitting with a very strong balance sheet sitting in net cash with more techs behind you. I'm just wondering what your appetite is or the environment is for acquisitions in 2025 relative to where we sat in 2024? Thank you.

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes. Thank you. Let me talk about our markets and how we think about that and volatility and opportunity within them first, and then I'll ask Dennis to address the second part of your question about capital. So, we'll give you an update on our view of our serve markets in June at the Analyst Day. I think I look forward to sharing that with you and our view about how we expand them.

[Robert Willett, President & Chief Executive Officer at Cognex]

Obviously, we did expand with the acquisition of Maritex when there are adjacencies and other markets we're moving into that where we see opportunities to grow that serves market and we'll give you more color on that. In terms of where our interests lie and where how to think about volatility within those markets, we see our logistics market is still our largest served market and the one we expect to grow fastest. And that was true when we last gave you an update and it's still true today very much that those are exciting growth markets for us and will continue to be a great focus of innovation and investment. And so that's exciting and witness the modular vision tunnel, the progress we're making with parcel and host companies, our great success with the technology leaders in that space. And we think that has a long way to run.

[Robert Willett, President & Chief Executive Officer at Cognex]

In terms of other markets, what I would say is I think we all understand that Cognex is highly indexed on the technology leaders and the big leaders in the premier customers in our markets, whether it's automotive or consumer electronics, right? And those tend to have more they have tend to put more volatility into our business overall. But our emerging customer initiative really allows us to broaden our customer base, going from serving about 30,000 customers as we do to going down more into more mid tier and more entry level customers and really broadening that. So we would expect that to to take some volatility out of our business in future. And with volatility, you can see that we can underperform in difficult periods and outperform as I think we did in the fourth quarter as a result of some very strong relationships we have in some very good markets.

[Robert Willett, President & Chief Executive Officer at Cognex]

But that's not ideal in terms of running a stable business. And I think the emerging customer program allows us to do that quite well. You asked about other markets, medical, which in a big bag of medical businesses, including pharmaceutical, life science, medical device representing about 10% of our business overall. Those markets haven't been good over the last few years since COVID. I'm confident, I think everyone is that they will return to growth.

[Robert Willett, President & Chief Executive Officer at Cognex]

And that's the type of market again where we will be having much more sales activity as a result of our emerging customer sales force and much more appropriate products for the level of technical expertise that those industries have to adopt them. So I would expect over time that we would see smaller markets, packaging related medical, even aerospace markets where we've been very underpenetrated, but we're seeing some nice progress in terms of activity. And as those markets recover, hopefully, a broader base of customers with less

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

volatility. Let me take it from here in regards to the M and A question. Maybe I'll start first with a quick summary of the overall capital strategy and then talk a bit more about M and A specifically. So on overall capital strategy, I've been always saying like our number one area is our organic investments. Think about like the sales transformation and sales expansion, which we're investing into.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

And second comes M and A. Third, share buybacks and fourth, the dividends. So it's kind of your one off priority. It means M and A quite high in that stack. And we have been coming out of the Moritex acquisition, which I think we feel extremely positive and successful about.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

We talked about how that has helped to be accretive to adjusted EPS and bring actually it up by a penny there. So in that regard, I think we made very good success story on the Moritec side, and that clearly means like that we are looking for continued M and A. But it's also clear that we are looking for quality deals, and that means we'll be thoughtful when we're making these decisions. And at the same time, I think there's probably a lot further to discuss where I probably doesn't have the time right now, but I'm really looking forward to continue a bit more in this conversation at our Investor Day so we can talk then a bit more about like, hey, what could be potential markets? How do we think about like the balance sheet in that regard?

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

So a lot of good topics to cover there and I think we'll address these at Investor Day.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Thank you. Very helpful.

[Operator]

Thank you. The next question is coming from Piyush Abbasi of Citi. Please go ahead.

[Piyush Avasthy, Analyst at Citi]

Hey, good morning guys. Thanks for taking my questions.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Hey, good morning.

[Piyush Avasthy, Analyst at Citi]

So the current U. S. Administration appears to be more pro U. S. Manufacturing.

[Piyush Avasthy, Analyst at Citi]

Speaking with your customers across the auto or consumer electronics end markets, have you at least begun to see a step up in conversations that your customers are talking about reshaping their manufacturing footprint and maybe adopting more automation and machine vision?

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes. Thanks for the question. I would say there's certainly an increase of discussion and interest around that topic, no question. And I think every manufacturer in America is thinking very much about the risks and upside associated with tariffs and other actions that are going on. I would put a little in the context, though, that there's just a huge amount of uncertainty and confusion.

[Robert Willett, President & Chief Executive Officer at Cognex]

So I think it's not that sort of interest isn't really leading to, I think, action at the moment. It's leading to confusion. And hopefully, we'll see more clarity and then more actually action. But maybe to give you a little context, if we think about our Q4 performance and our Q1 guidance, I think there was quite a lot of excitement and positivity that we saw in the back end of last year, really post election in November and December, which did account for some higher spending in prior years, I might have called it budget flush type spending that went on in November and December in Americas really only, I'd say. And I might size that at about $6,000,000 to $7,000,000 of business that I think we received in Q4 as a result of that enthusiasm that really came straight out of Q1.

[Robert Willett, President & Chief Executive Officer at Cognex]

So I think there's that. We do have FX is, I think, a worry in general for companies where the strength of the U. S. Dollar is a $5,000,000 or so headwind for us in Q1 as well. And then there are a lot of policy changes, obviously.

[Robert Willett, President & Chief Executive Officer at Cognex]

When we were talking a year ago, there was a lot of enthusiasm about the Inflation Reduction Act and other things. Clearly, there's a lot more confusion about that. So certainly, that's all at play. I do think if we see major investment in manufacturing and major on shoring going on in The United States, Cognex should be a major beneficiary of that given our strength in this market.

[Piyush Avasthy, Analyst at Citi]

Helpful. I was a bit late on the call, so maybe you addressed this. But I think you highlighted pricing challenges in the quarter, particularly competing in the China region. Can you update us on that? Like how would you characterize the pricing environment as it doesn't seem that the demand outlook has changed much?

[Piyush Avasthy, Analyst at Citi]

And are competitors in other regions being disciplined from a pricing standpoint? Or are you seeing more incidence of lowering prices to win contracts?

[Robert Willett, President & Chief Executive Officer at Cognex]

I would say we've been talking for a few quarters now about price the pricing dynamic in China. China certainly is an extremely competitive market for us and our customers, right? I don't think there's much change to report from that situation in the last quarter compared to what we're generally seeing. But China is a market where there are strong and emerging competitors in our industry and to us specifically. I think everyone's been seeing this as an extremely difficult market.

[Robert Willett, President & Chief Executive Officer at Cognex]

Some of the larger players that we see emerging state owned enterprises have actually been cost cutting and reducing some of their spend. So certainly, they're feeling the sort of pain that we're seeing in that market. Our strategy, taking a leaf out of the innovator's dilemma, is we want to maintain share. And we want to maintain customers and share as we go through this in China. We have very strong technology and good gross margins even at difficult prices.

[Robert Willett, President & Chief Executive Officer at Cognex]

So we're willing to take a hit to pricing to maintain share and that's been the situation it continues to be. As we bring new technology to market, we're hopeful that we'll have bigger deltas that we can assert, the Dataman two ninety being an example of something we might see in that space. But I'd say in terms of the pricing discussion, it's a very distant gross margin topic compared to some of the volume things that hit our gross margin or the dilution of Martex, which we're getting to grips with and should improve also. Dennis, what

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

would you add? Yes. No, absolutely. I think if you think about both 2024 as a full year or Q1 Q4 specifically, I think really the biggest topics we have seen working in the gross margin is really more attacks and then mixed effects like the strong growth of logistics. And it's also very clearly that like volume plays a big role as well, right?

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

So that means we have infrastructure and fixed costs are there. So higher volume or lower volume really drives leverage there. And then pricing is really the fourth item there in the stack, which is really to a lesser extent. But it's very clearly that we are seeing these dynamics and therefore wanted to be transparent and clear about it, what we are seeing and that's particularly in China and I think Rob covered that well.

[Piyush Avasthy, Analyst at Citi]

Appreciate all the color guys. Good luck.

[Operator]

Thank you. The next question is coming from Jacob Levinson, Amelius Research. Please go ahead.

[Jacob Levinson, Analyst at Melius Research LLC]

Hi, good morning everyone.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Good morning. Good morning. Just

[Jacob Levinson, Analyst at Melius Research LLC]

to attack the M and A side of things from a different angle, I know you folks have bought some really interesting machine learning assets at Sula Lab in Viti before AI was cool, so to speak. Has the as as the, you know, the the rise of AI and the broader public consciousness, does that increase the competition for those types of deals or or are they just are they just too niche for most buyers that would be looking at the things that interest you guys?

[Robert Willett, President & Chief Executive Officer at Cognex]

So Jake, to be clear on your question, you're asking kind of are those assets still out there? How are they kind of priced and how are we thinking about them?

[Jacob Levinson, Analyst at Melius Research LLC]

Yes, exactly.

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes, yes. So, excuse me. At Cognex, we really excel at finding the best technology for our kind of specific market industrial machine vision. We're very well known. We have a great reputation and we cultivate the companies, the small companies that we think are doing great work.

[Robert Willett, President & Chief Executive Officer at Cognex]

And Oviedi is a great example of that, really an excellent Swiss based company with some phenomenal engineers doing things that when we really got to understand them, blew us away, and we were delighted to acquire them. So I think that was eight years ago, I guess. And I think probably that the general investor community saw the potential for advanced technology in manufacturing. So there are a lot of companies that kind of were very heavily invested in the years following that time that are now, I'd say, kind of for sale. And so there's a lot of them to see.

[Robert Willett, President & Chief Executive Officer at Cognex]

But a note of caution is when we really get in and look at those companies, they may have raised $50,000,000 of capital on a business plan to have sales of $30,000,000 now and their sales are 10% of that amount and they're really more around consulting or other things. They really haven't achieved the potential that they expected. So I think the valuation of those companies is not what people thought they would be five years ago, which is an opportunity for Cognex because some of them have good technology they haven't been able to bring to market. But certainly, the kind of the realism about what they actually have and where they are is one I would say is a strong theme that I would observe, overall. And I think it kind of underscores that to play well in our market, it's not enough to have great technology.

[Robert Willett, President & Chief Executive Officer at Cognex]

You have to understand customers. You have to have applications engineers who really understand the application. And that's where the 3,000 or so strong cognoids that we have who are out there every day, the 30,000 customers or so with the, who know some of them are the most sophisticated suppliers of technology. That's great opportunities for us to take technology and apply it, which isn't quite as easy as it might appear to someone who eight years ago launched off on a plan. So I'd say that's the current state of it.

[Robert Willett, President & Chief Executive Officer at Cognex]

My hope is that some of those really good companies and great engineering teams will join Cognex over time. And there's the potential for that to happen certainly.

[Jacob Levinson, Analyst at Melius Research LLC]

Okay. Appreciate it, Rob. I'll keep it to one question today. Good luck.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Thank you. Thank you.

[Operator]

Thank you. The next question is coming from Joe Ritchie of Goldman Sachs. Please go ahead.

[Joe Ritchie, Managing Director at Goldman Sachs]

Hey guys, good morning.

[Robert Willett, President & Chief Executive Officer at Cognex]

Hi Jim. Good morning.

[Joe Ritchie, Managing Director at Goldman Sachs]

So Rob, I thought your comments on infusing AI into your tools and the fact that you now require less images to train a model were really interesting. I guess I'm just curious. On one hand, I can think of that as being a competitive advantage if you are, you know, first mover and your technology is advanced relative to others. On the other hand, it also kind of seems like it may potentially lower the barriers to entry for additional competitors, startups, maybe Chinese competitors. I'm just curious, like how do you get comfortable that you can sustain your technology advantage and this isn't just going to increase competition for your end markets?

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes. Great question, Joe. Thanks so much for it. It is both a great opportunity and a potential threat for Cognex. There's no doubt about that.

[Robert Willett, President & Chief Executive Officer at Cognex]

The technology is allowing us to do things for customers very quickly and very well that we and they couldn't do before. And it'll spread the technology more broadly within existing customers, and that's very exciting. And here it's worth pointing out that there's a lot of kind of great public technology from Silicon Valley kind of coming out of companies, but that technology isn't ready for industrial application. And there's a lot of expertise we have in taking publicly available models and applying them and really making them work. They don't work well when just applied even with experienced programmers to our industry without deep domain and technology and customer knowledge that we have.

[Robert Willett, President & Chief Executive Officer at Cognex]

I think where this technology is also really both very exciting for us but also will change our industry is it's making machine vision much easier to apply and implement, right? And you can really see that we're leading in that space as a result of applying technology and edge learning. Deep learning went to edge learning and transformer models are in a way a future that's to almost no learning, right? And that is something that we do extremely well and are leading the industry in, but it will change the sale and it will change who we sell to and how we sell and what we provide for them. Less application engineering, more pure technology that they can implement.

[Robert Willett, President & Chief Executive Officer at Cognex]

I would say I'm pretty optimistic about what that means for Cognex in the next few years. I think the technology that you're seeing coming out of Silicon Valley is still going to be too hard to apply really to our customers and the people who are going to apply it first are going to be us and we're going to see it kind of driving. And that's I also feel really good about the emerging customer sales force we're putting in place. You can just get that technology out to so many more users and sell it much more quickly than we have before. So that's the overall picture.

[Robert Willett, President & Chief Executive Officer at Cognex]

But we're a technology company, right? The business is always the technology is getting better and faster and easier to use. Prices come down, applications expand, new markets appear. It's wild and wooly and fun business. And we've been doing it for forty three years and we're going to go on taking those same principles that have made us successful to this new revolution.

[Joe Ritchie, Managing Director at Goldman Sachs]

Thank you, Rob. I'll keep it there.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Thank you. Thanks.

[Operator]

Thank you. The next question is coming from Ken Newman of KeyBanc Capital Markets. Please go ahead.

[Katie Fleischer, Equity Research Associate at KeyBank Capital Markets]

Hi. This is Katie Fleisher on for Ken. I'll keep it short here. I just was wondering how your positioning for tariffs and any potential margin impacts from those of another trade war materializes.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

Yes, happy to take that. I would say the headline statement here is that based on the tariffs which have been announced so far, there's no material impact to COGX and direct on the COG side. Certainly, things are uncertain, right? More tariffs may come, but in general of what is announced so far, no direct impact. Then of course, there could be a secondary impact from the tariffs, right?

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

So in the near term, again, there's a bit of uncertainty. We talked about like we have seen a lot of positive momentum in the November timeframe and that has shifted towards more near term uncertainty in some of our customer side. Think about the automotive supply chain across Mexico, Canada and The U. S. So that's not necessarily helpful.

[Dennis Fehr, Senior VP of Finance & CFO at Cognex]

But then if you think about it in the mid and longer term, the reassuring opportunity for Cognex is tremendous, right? So that means if that is really starting to happening, then there's a tremendous additional market upside for us.

[Katie Fleischer, Equity Research Associate at KeyBank Capital Markets]

Great. Thank you. I'll leave it there.

[Operator]

Thank you. We're showing time for one final question. Our last question today is coming from Jerm Nathan of Daiwa. Please go ahead.

[Jairam Nathan, Executive Director at Daiwa Capital Markets]

Hi. Thanks for squeezing me in here. So I just wanted to go back to your Molitex acquisition. I think when you made the acquisition, the objectives were expanding beyond Japan and using more of Moltex optics into Cognex equipment. So I just wanted to kind of understand how you guys how it was done in the year, what's the progress?

[Jairam Nathan, Executive Director at Daiwa Capital Markets]

And I just had one more question, please.

[Robert Willett, President & Chief Executive Officer at Cognex]

Yes, great. We're about 1.25 into owning MarTechs and we're very pleased with how we're taking that technology and selling it to our existing customers. And That's one way in which we can increase gross margin and grow our business. So that's kind of awesome. We're taking that technology to many customers because they were very much primarily a Japanese focused business.

[Robert Willett, President & Chief Executive Officer at Cognex]

We're globalizing it for them. And then, yes, you're going to see more and more of it integrated into our core products. So it's a lot of good progress and increasing excitement around that.

[Jairam Nathan, Executive Director at Daiwa Capital Markets]

Do you need to do any validation? Like would does it take longer to kind of get into get Moltex components into the products? Is that a bottleneck or something? Or

[Robert Willett, President & Chief Executive Officer at Cognex]

It's something we're very used to doing. It's very sophisticated. We got PhD Photonics people and optics people who work on that, but we're very comfortable and we know how to do it.

[Jairam Nathan, Executive Director at Daiwa Capital Markets]

Okay. And just finally, some of the logistics companies seem to be, especially on the parcel side, seem to be they're talking about moving from moving to sensing from scanning. I just wanted to understand how would that impact Cognex, if that trend kind of continues. I just wanted to understand it could be good for you. I just wanted to understand that.

[Robert Willett, President & Chief Executive Officer at Cognex]

Sure. I'll keep my answer brief. But today, kind of the barcode is the defining way in which packages are identified. I don't expect that to change. But certainly, there is the opportunity to have more package recognition using machine vision on it.

[Robert Willett, President & Chief Executive Officer at Cognex]

Right? And, you know, some packages are complicated, and being able to use vision to inspect them, something we're extremely good, is somewhere that our customers would like to go. And it's certainly a journey we're enjoying exploring with them.

[Operator]

Thank you. This brings us to the end of the question and answer session. I would like to turn the floor back over to Mr. Rob Willett for closing comments.

[Robert Willett, President & Chief Executive Officer at Cognex]

Well, thank you so much for joining us this morning. I enjoyed the discussion and we look forward to speaking with you again on next quarter's call.

[Operator]

Ladies and gentlemen, thank you for your participation and interest in Cognex Corporation. This concludes today's event. You may disconnect your lines or lock off the webcast at this time and enjoy the rest of your day.

Participants

Executives

• Nathan McCurren, Head Of Investor Relations
• Robert Willett, President & Chief Executive Officer
• Dennis Fehr, Senior VP of Finance & CFO

Analysts

• Damian Karas, Executive Director at UBS Group
• Tommy Moll, Managing Director at Stephens Inc
• Andrew Buscaglia, Senior Analyst at BNP Paribas
• Jamie Cook, Managing Director - Equity Research at Truist Securities
• Piyush Avasthy, Analyst at Citi
• Jacob Levinson, Analyst at Melius Research LLC
• Joe Ritchie, Managing Director at Goldman Sachs
• Katie Fleischer, Equity Research Associate at KeyBank Capital Markets
• Jairam Nathan, Executive Director at Daiwa Capital Markets