Mike Crawford

Mike Crawford asked about the timing of the $130 million new bookings flowing into backlog, the company's strategy for achieving top-line growth amidst product mix changes, and any updated plans for addressing the PIK preferred stock obligation.

Answer

Ken Traub, Chairman, President, and CEO, clarified that a portion of the $130 million booking occurred in Q1, with the majority anticipated in Q2. He emphasized Comtech's focus on optimizing cash flow, having strategically downsized to position for future regrowth, and expressed confidence in reaching an inflection point for improved margins and attractive growth opportunities by shifting away from low-margin products. Regarding the PIK preferred stock obligation, Mr. Traub stated the company is exploring various options to enhance its capital structure but is not ready to announce specific plans.

Mike Crawford from B. Riley Securities inquired about the timing of the $130 million new bookings flowing into backlog, the company's strategy for returning to top-line growth given product mix changes, and potential options for managing the PIK preferred stock obligation.

Answer

Chairman, President, and CEO Ken Traub clarified that the majority of the $130 million booking would be recognized in the second quarter. He emphasized Comtech's focus on optimizing cash flow, having strategically reduced low-margin business to position for future growth with higher-margin opportunities. Regarding the PIK preferred stock, Mr. Traub stated the company is exploring options to improve its capital structure but was not ready to provide specific details.

Mike Crawford of B. Riley Securities inquired about the development and production status of next-generation digital backend modems, including the EDEM program. He also asked about any outstanding competitions for the 911 business and the booking trends for the current quarter.

Answer

Daniel Gizinski, President of Satellite & Space Communications, reported good progress on the EDEM program, with certification expected by the end of the calendar year, and noted that other product variants are already in early production. Jeff Robertson, President of Terrestrial & Wireless Networks, confirmed the company is awaiting decisions on several compelling bids for its 911 business but declined to provide specifics. CEO Kenneth Traub stated that the company is not providing guidance and would not comment on current quarter bookings.

Mike Crawford from B. Riley Securities asked about AST SpaceMobile's plans for manufacturing L-band satellites, specifically if L-band and S-band would be integrated onto the same satellites, and if FCC approval was a prerequisite. He also inquired about the Saudi Telecom agreement's commercial service launch in Q4 2026, the spectrum to be used, and if there were additional service revenue commitments beyond the $175 million prepayment.

Answer

Scott Wisniewski, President and Chief Strategy Officer, and Abel Avellan, Chairman and CEO, confirmed plans to interleave L-band and S-band with 3GPP frequencies on satellites, with mid-band satellite launches by end of next year. They stated that commercial services with STC and other partners would primarily use operator spectrum available in devices. Scott Wisniewski clarified that the over $1 billion in revenue commitments are hard commitments, with STC's agreement including both a prepayment and a long-term revenue commitment.

Mike Crawford asked if AST SpaceMobile intends to integrate L-band and S-band capabilities on the same satellites during manufacturing, whether FCC approval was a prerequisite for L-band satellite production, and sought clarification on the spectrum used for the Saudi Telecom agreement and additional service revenue commitments.

Answer

Scott Wisniewski, President and Chief Strategy Officer, and Abel Avellan, Chairman and CEO, confirmed that satellites will include all 3GPP frequencies (low-band and mid-band), including acquired L and S-bands, with mid-band satellite launches planned by the end of next year. They stated that the Saudi Telecom agreement, like others, will start with operator spectrum available in devices, and reiterated that the over $1 billion in revenue commitments are hard commitments, not soft, and include the STC prepayment and long-term revenue commitment.

Mike Crawford inquired about the HaloNet system, its timeline, and specific applications such as launch telemetry, LEO to GEO relay for sensor data, and tasking/command and control. He also asked about the impact of quantum computing on Viasat's cryptographic and encryption franchises and how the company is accounting for the $420 million cash received from Ligado on Halloween and the additional $100 million expected on March 31st.

Answer

Mark Dankberg, Chairman and CEO, explained that HaloNet targets several markets, including launch telemetry and space relay for sensor data and command/control, aiming to reduce latency and address bottlenecks in government assets. He noted that quantum computing drives demand for quantum-resistant cryptography, leading to a refresh in secure systems, and also fuels demand for data center cryptos due to computationally intensive applications like AI. Shawn Duffy, Chief Accounting Officer, stated that most of the Ligado lump sum proceeds would go to deferred revenue and be recognized over the contract life, with interest income being EBITDA neutral. Gary Chase, CFO, added that a chunk would also appear in operating cash flow.

Mike Crawford asked about other providers using Kratos's systems for hypersonics testing and Kratos's opportunities in next-generation command and control.

Answer

Eric DeMarco, President and CEO of Kratos, confirmed that other companies are launching systems on Kratos's platforms, citing Hypersonix's Dart hypersonic drone being launched on Kratos's Zeus. He declined to provide details on next-generation command and control opportunities due to classification.

Mike Crawford inquired about Kratos' involvement in other providers' hypersonic missile testing, specifically mentioning Castellian's Blackbeard, and asked about opportunities in next-generation command and control.

Answer

Eric DeMarco, Kratos' President and CEO, confirmed that Kratos' systems are used for launching third-party hypersonic drones, citing Hypersonix's Dart hypersonic drone being launched on Kratos' Zeus. He stated that he could not discuss classified information regarding next-generation command and control opportunities.

Mike Crawford from B. Riley Securities inquired about the ranking of key missile programs, the status of new facility constructions, and whether Kratos would begin another Valkyrie production run before securing a new award.

Answer

CEO Eric DeMarco confirmed involvement in numerous key missile and radar programs without ranking them. CFO Deanna Lund stated that facility build-outs are mostly on track, though some construction schedules could slip into 2026. Mr. DeMarco declined to comment on future Valkyrie production plans to avoid getting ahead of customers.

Mike Crawford asked about specific missile programs supporting turbojet engine production and how Valkyrie manufacturing impacts financials upon contract award, plus Prometheus reporting.

Answer

CEO Eric DeMarco mentioned missile programs like JDAM and Mace. CFO Deanna Lund explained revenue recognition upon contract. Prometheus will be below the line.

Mike Crawford of B. Riley Securities inquired about the new Indianapolis facility's timing and revenue capacity, the company's capital allocation focus between the Medical CMO and other areas like industrial, and the general impact of tariffs on its global operations.

Answer

CEO Richard Phillips stated the Indianapolis facility will have its grand opening in November and can handle "hundreds of millions of dollars" in business. He confirmed a primary focus on the Medical CMO but noted opportunities exist across all verticals. Regarding tariffs, he explained that Kimball is often not the importer of record, considers tariffs a pass-through cost, and takes "no regrets moves" like qualifying alternative supply sources. CFO Jana Croom added the new facility's capacity could be "well in excess of $500,000,000".

Mike Crawford inquired about the potential gain from remaining narrowband-to-broadband license exchanges, the timing for these conversions, and the company's strategy for spectrum in regions where a utility has dropped out of the pipeline.

Answer

CFO Timothy Gray explained that while Anterix can apply for broadband licenses in 90% of U.S. counties, only 10% have been granted, with over $1 billion in potential gains expected over time. He declined to provide specific timing guidance due to the variability of the FCC approval process. COO Ryan Gerbrandt clarified that the utility mentioned did not fall out of the pipeline; rather, its executive sponsor changed roles, and Anterix remains confident in the opportunity.

Mike Crawford of B.Riley Securities asked for an update on new members of the Anterix Active Ecosystem, questioned the potential impact of a competitor acquiring 800 MHz spectrum, and inquired about the company's goals for new contract signings over the next 12-18 months.

Answer

COO Ryan Gerbrandt noted the ecosystem has grown to over 140 participants, highlighting a recent product offering from Digi International. CEO & President Scott Lang addressed the competitive landscape, stating Anterix is well-positioned with proven deployments, strong economics, and a clear path to 5x5 MHz, making it the preferred choice for utilities. CFO Timothy Gray stated that Anterix aims to significantly grow its contracted proceeds in fiscal 2026, surpassing the $116 million achieved in fiscal 2025.

Mike Crawford questioned the strategy for the engineered and aftermarket products business, asking if its current ~$200M run rate provides enough scale to be a standalone entity and how difficult a separation would be. He also asked for an update on the company's progress in the space and unmanned systems markets.

Answer

SVP & CFO Suman Mookerji highlighted the synergies between the engineered products business and the core contract manufacturing operations, noting they share the same customer base. Chairman, President & CEO Stephen Oswald added that building scale in that segment is a top priority and advised to 'stay tuned' on its long-term structure. Regarding space, Oswald described the market as opportunistic for Ducommun, which supplies key components but remains more strategically focused on defense and commercial aerospace due to high development costs.

Mike Crawford of B. Riley Securities requested specifics on the improvements in on-time delivery, the revenue potential of the 60 dedicated medical machines, the expected timing of the CARES Act tax refund, and the execution plan for entering the electrical harness market.

Answer

SVP & COO Tim French detailed the operational turnaround, moving from 'red' to 'green' scorecards with all customers over the past 18 months. CEO Harold Bevis and French estimated the current medical machine footprint provides about $40 million in available annual capacity. CFO Christopher Bohnert confirmed the tax refund is imminent, expecting it within weeks. Bevis explained the electrical harness entry is a lower-cost initiative than medical, enabled by a newly hired, experienced team.

Mike Crawford of B. Riley asked for metrics on on-time delivery performance, whether there was a correlation between improved deliveries and new business wins, and for a breakdown of products from the China JV that are exported versus those that remain in China.

Answer

COO Tim French explained that while a formal on-time delivery metric isn't tracked, past-due backlogs have dropped significantly, leading to 'green scorecards' from all customers. Both French and Executive Harold Bevis confirmed a direct correlation between this improved performance and new wins, with Bevis noting 77% of new business came from customers who previously had them on 'new business hold.' Bevis also confirmed that parts from the China JV are increasingly exported as end customers like BYD expand globally, and that overall demand in China is increasing as European Tier 1s shift production there.

Mike Crawford of B. Riley Securities asked about NextNav's next steps in the FCC process toward a Notice of Proposed Rulemaking (NPRM) and for an update on potential partnerships with space-based PNT providers.

Answer

CEO Mariam Sorond stated that NextNav has submitted a complete and robust technical record to the FCC, which she believes is sufficient for the agency to proceed with an NPRM. Regarding partnerships, Sorond confirmed the company's belief in a 'system of systems' approach and continues discussions with satellite players, but had no specific updates to share at this time.

Mike Crawford of B.Riley Securities inquired about the capacity expansion plans in Penang, the project timeline for the Syracuse facility, capital plans for the new Wisconsin site, and the current environment for potential M&A in the defense and RF sectors.

Answer

President & CEO Thomas Edman detailed that Penang's Phase 1 has ~$200M in revenue capacity, with a potential 20% increase in Phase 2, and the new land purchase secures long-term options. He confirmed the Syracuse facility is on track for production in H2 2026, while capital plans for Wisconsin are undefined pending customer commitments. On M&A, Edman noted a recent pause but expects more opportunities in the microelectronics and RF microwave space to emerge over the next 12-18 months.

The analyst inquired about the potential for securing more than the forecasted EUR 200 million from Bpifrance and asked for clarification on the timelines for both the KfW due diligence and the Bpifrance funding process.

Answer

The EUR 200 million from Bpifrance is the current best guidance based on the project's spend and eligibility. The 6-to-8-week timeline for KfW due diligence is from the present time. The company declined to speculate on the specific timing for the French (Bpifrance) process to respect the ongoing procedures.

Mike Crawford of B. Riley Securities asked about the amount of capital needed to complete the ODM transition, the specifics of the D&O insurance deductible for ongoing legal expenses, and the revenue recognition policy for the new channel distribution strategy with partners like SYNNEX.

Answer

CEO Tom Wilkinson and CFO Bob Tirva clarified that they are shoring up the balance sheet as a precautionary measure against uncertain legal costs and the gap between legacy and new product cycles, rather than for a specific capital need. Tom Wilkinson confirmed the legal costs relate to an SEC matter with a $7.5 million D&O deductible. Bob Tirva explained that revenue from distributors is now recognized upon shipment, with a reserve for returns.

Mike Crawford of B. Riley inquired about Sonim's channel business model, specifically regarding revenue recognition for new tablets and revenue expectations for the latter half of the year. He also asked about the proprietary nature and recurring revenue potential of Sonim Scan software, and whether the disruptive pricing for new products is a long-term strategy.

Answer

CEO Tom Wilkinson explained that the goal is to recognize revenue upon shipment to channel partners. While declining to provide future guidance, he noted strong Q1 sales for the RS80. Wilkinson clarified that basic Sonim Scan functionality is integrated into the new hardware and is not a separate recurring revenue stream, but part of the broader SonimWare suite which drives customer loyalty. He confirmed that the company's price-differentiated strategy is intended to be permanent and long-term, not just an introductory offer.