Plantronics, Inc. (NYSE: PLT) Q2 2021 earnings call dated Oct. 29, 2020
Corporate Participants:
Mike Iburg — Vice President, Investor Relations
Dave Shull — President and Chief Executive Officer
Chuck Boynton — Executive Vice President and Chief Financial Officer
Analysts:
Michael Fisher — Evercore ISI — Analyst
Gregory Burns — Sidoti & Company, LLC — Analyst
Eric — Morgan Stanley — Analyst
Liz Pate — Cowen and Company — Analyst
Presentation:
Operator
Ladies and gentlemen, thank you for standing by and welcome to the Poly Q2 2021 Earnings Conference Call.
Mike Iburg — Vice President, Investor Relations
Welcome to Poly’s financial results conference call for the second quarter of fiscal year 2021. My name is Mike Iburg, Head of Investor Relations. And joining me today are Dave Shull, Poly President and CEO and Chuck Boynton, Executive Vice President and CFO.
The information presented and discussed today includes forward-looking statements which are made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. The risks and uncertainties related to such statements are detailed in our most recent 10-Q, 10-K and today’s press release and earnings presentation. Throughout today’s remarks, we will refer to specific slides from our Q2 FY21 earnings presentation. You should also refer to the materials we provided today for an explanation of the non-GAAP financial measures discussed on today’s call, along with a reconciliation of those measures to the nearest applicable GAAP measures. These non-GAAP measures are indicators that management uses to provide additional meaningful comparisons between current results and previously reported results and as a basis for planning and forecasting future periods. All of our earnings materials are posted on our Investor Relations website at investor.poly.com.
With that, I’ll now turn the call over to Dave.
Dave Shull — President and Chief Executive Officer
Thanks, Mike. First I want to thank the Poly team for the warm welcome when I joined last month. And particularly, I want to thank Bob Hagerty for his leadership as Interim CEO prior to my joining. Bob and the Board were transparent on both the opportunities and challenges at Poly. I appreciate this clear-eye view to the Company. We are focused on executing a rapid turnaround and I am very optimistic about the future of Poly.
The world has changed for all of us. The shift to work from home continues to drive demand for our headsets while our next-gen video solutions are selling well ahead of expectations. Of course, as a counterbalance demand for office phones remained soft. We have increased our supply chain capacity to ship a record number of headsets and video units during the quarter. This strong demand, coupled with cost management, allowed us to deliver revenue and profitability above the top end of the guidance ranges. Based on the strength of the business, we have begun to put our accumulated cash to work, retiring $37 million of debt in the quarter. This is just the beginning of what I believe will be an exciting turnaround for Poly.
Before accepting the CEO role, I spent time looking at the Company, learning about the products and markets and getting an overview of the competitive landscape. Poly’s history of innovation in professional-grade audio and video products stretches back decades. After all we put the first headset on Neil Armstrong as he stepped down to the moon. I also remember while the first time I had an office with a Polycom speakerphone, I felt that I had arrived.
This is now day 50 for me. In the last few weeks, I talked with many of our distributors, resellers and major customers worldwide. It’s clear that we fumbled some of the integration steps between Plantronics and Polycom. However, the feedback has been consistent. They love our products, especially some of our newest releases. But we have been hard to work with because we didn’t properly integrate our sales teams and systems and our supply chain challenges have led to extended lead times on some products. I would add to that feedback that we become a bit complacent about our competition and scattered in our messaging. However, as an incoming CEO this is an exciting place to be because the underlying technology know-how and products are in good shape. All the other problems can be solved with focus and execution.
Let me emphasize the word focus since that will be a change for us as well. We have a set of executives in place with good bench strength. Most of us are quite new. So we’re pulling together rapidly to get Poly on a strong trajectory of profitable growth.
Over the last 15 years, I’ve held leadership roles at DISH Network, The Weather Channel and TiVo. In each case these companies had well-known brands with complex business transformation challenges. At DISH, we focused on transitioning a two-tier distribution channel with thousands of partners from traditional satellite to streaming. At The Weather Channel we spun off the consumer app to IBM, while significantly improving profitability and ratings of the television network. At TiVo we refocused the company to launch new consumer hardware into the streaming wars while preparing the company for an eventual merger. These experiences with business transformation, radical refocusing for growth, cost cutting, channel evolution and new hardware product launches are all relevant as we look to transform Poly for the massive work from home and hybrid working opportunity in front of us.
Only Poly has the headsets, video devices and voice solutions that can stand up to both the largest most stringent enterprise requirements for security, compliance, quality and reliability while also working seamlessly at your home. We have built out the Poly AI for noise blocking, audio fencing, image quality and more so we can handle both the challenges of kids and dogs at home or the massively distributed high-security needs of the world’s biggest banks and insurance companies, governments, oil and gas companies, healthcare and education systems. Our Poly Lens platform will be able to pull all of this AI capability, IT management metrics and consumer enhancement alerts into a single package that is suitable for the world’s biggest companies and the individual worker in their homes.
Let me be specific with some of the customer deployments which I am most proud. My mother has been a nurse for as long as I can remember. Over dinner I’d here about the challenges and stress, but then also the rewards of patient care. Now providing patient care remotely requires crystal clear video, strong audio integrity and reliable monitoring and management of those connections. I am proud that Poly is the technology partner of choice for many first responders, hospitals and healthcare clinics.
For example, Poly products are helping customers like Johns Hopkins Hospital which leverages a fleet of Poly video endpoints to conduct 14,00 remote video telehealth deployments per day or Marietta Memorial Hospital which uses our video and audio solutions to more efficiently connect patients in remote or underserved areas with medical specialists located in any one of Marietta’s 50 locations around the region.
Poly is helping in education too. Like many of you my two school-age children are distance learning. The first time my daughter had a video conference call with their classmates, she was so thrilled. Needless to say that was many months ago at this point and the novelty has definitely worn off. For the first few weeks we all scrambled with whatever devices we had on hand. However, as this become obvious that these remote learning challenges will last for a while, we have seen increasing demand from school districts looking for higher quality and more reliable solutions. And just the last quarter, we closed deals with several dozen school districts across the country to deploy our video solutions to support both their faculty and students. Boston Public Schools, for instance, has standardized on Poly video equipment, deploying several thousand studio video bars across 350 schools to help teachers improve the learning experience for their 54,000 students. Our advanced video features such as speaker tracking and auto zoom coupled with high-quality audio, create a more realistic experience and allows students and teachers to feel as if they are in the same room.
Poly is on the leading edge of one of the most transformative events to affect the delivery of healthcare and education in generations and I’m excited to be part of it. The product portfolio is in good shape and the hybrid work environment creates an opportunity to expand our product offering. In the next couple of months, you will see us launch a range of products more targeted at work from home or work from anywhere.
We announced the first of these earlier this month. Poly Sync is a new family of intelligent speaker phones designed to address the needs of employees in the office or working remote. These USB and Bluetooth speaker phones can be used individually a home or daisy-chained together for a complete conference room solution. They include proprietary microphone technology to track the speaker, can integrate with a voice assistant and offer excellent audio quality. As more employees are now expected to work a hybrid schedule splitting their time between home and office, we have already seen strong reviews and demand for Poly Sync.
I have told the team that I joined Poly to play to win and I intend to do just that. These new product launches targeted for the work from home, work from anywhere, work from office environment will provide strong extensions to our current portfolio. Stay tuned on that front.
Let me make a few comments on our other short-term operating priorities; number one, increasing manufacturing capacity to match the strong sales demand, number two, strengthening our strategic partnerships, and number three, optimizing our costs. First, our immediate focus is to build supply chain capacity to handle the increased demand. In fiscal Q2 we expanded the number of dual-source assemblies, negotiated additional capacity at our contract manufacturers and added to our in-house manufacturing capacity in Mexico. These steps allowed us to ship a record number of Enterprise Headsets and video endpoints. Although we’ve made progress, we are still experiencing extended lead times on select headsets and video bars.
On the partner front, we continue to offer the largest selection of Zoom and Microsoft Teams certified products for working professionals. And our sales teams are working closely with these critical partners. RingCentral announced its room solution featuring the Poly Studio X30 and X50. StarLeaf, a global provider of video conferencing services, announced that they have chosen Poly and their video platform vendor. And Poly and Extron have partnered to deliver room automation and AV controls for Microsoft Teams.
In each of the companies I have led, we have taken focused action to ensure that costs are in line with strong profitability benchmarks. While my first priority at Poly is growth, we are still taking immediate actions to keep COGS and operating expenses in check. We have targeted a couple of areas for cost reduction and implemented more stringent cost controls across the board. I will share more details in future quarterly calls.
Wrapping up, I view today’s results as the first step in a multi-quarter effort to turn around Poly. We have more work to do, but many of the foundational pieces are in place. My goal is to focus the organization immediately on rapid execution on the points above while also positioning us for a strategically differentiated position post-COVID. We will fix what’s broken and drive this Company back to long-term growth. I am competitive. I play to win. I’ve only been here eight weeks and as I’ve said before, we have a lot of work to do. However, after seeing the strength of the product portfolio and the talent in engineering, sales and throughout the whole organization, I am confident that we can turn the corner and go on the offensive.
I’ll now turn the call over to Chuck to review the financials.
Chuck Boynton — Executive Vice President and Chief Financial Officer
Thanks, Dave. Before I begin, I want to welcome Dave to the team and highlight the strong results in our resumption of delevering. To echo Dave’s comments, it’s exciting to see the strong demand for headsets and video and how our products are becoming an important component in the delivery of healthcare and education.
Turning to revenue on Page 18. Non-GAAP revenue declined year-over-year by 12%, but was above the top end of our guidance range. But the decline was primarily driven by lower voice demand and continued declines in consumer and services. This was partially offset by growth in Enterprise Headsets and video as work from home, telemedicine and remote learning are driving strong demand. While lead times continue to improve, aggregate backlog was essentially unchanged from last quarter. Geographically EMEA was flat year-over-year while the Americas and Asia-Pacific declined. However, all regions showed sequential growth.
As you can see on Page 19, our next-gen video solutions continue to experience rapid growth, nearly doubling sequentially and now representing over 40% of total video revenue. As Dave mentioned earlier, we shipped a record number of video endpoints in the quarter and the transition to the new platform has been dramatic. A year ago our next-gen portfolio represented approximately 20% of the units shipped. This quarter they were nearly 80%. In addition, this was the best video quarter since the acquisition of Polycom.
Regarding our supply chain, we still have extended lead times on certain headsets and new video products. New bookings continue to outpace production. So we expect extended lead times to continue.
Moving on to Page 20. Gross margins were 350 basis points lower driven primarily by expedited freight costs, factory expansion and product mix. Given the current level of demand, we expect freight costs to remain elevated for the foreseeable future as we make the trade-off in favor of customer satisfaction over gross margins. As a result, we expect only modest gross margin improvement over the next couple of quarters.
Operating expenses were flat sequentially at $144 million, which was down $21 million from last year driven primarily by cost savings from restructuring and lower T&E. Operating income of $59 million was down 27% year-over-year due to lower revenue. EBITDA of $69 million and non-GAAP EPS of $0.93 were both above the guidance ranges. As discussed last quarter, given the revenue growth we saw an increase in working capital which impacted operating cash flows. Other drivers included cash taxes, restructuring and the legal settlement we discussed last quarter which was booked to the P&L in Q1 but paid in Q2.
On a year-to-date basis, operating cash flow remains significantly ahead of last year. For Q3 we expect working capital to increase because of the projected revenue growth. This demand should reverse in Q4 when working capital should become a source of cash. As Dave mentioned, the continued strong demand for headsets and video gave us enough confidence to resume repurchasing debt. We retired $37.4 million in the quarter and our ending cash balance was $228 million, well above the amount necessary to run the business. As a result, we will likely continue to opportunistically retire debt.
Turning to guidance on Page 24. Today, we are providing guidance ranges for our fiscal Q3. Similar to last quarter, our guidance is based on the current supply forecast for Enterprise Headsets and video endpoints from both our factory in Mexico and our contract manufacturers. The availability of that supply can change depending on many factors outside of our control, including the current pandemic. With that understanding for fiscal Q3, we expect GAAP net revenue of $417 million to $447 million, non-GAAP net revenue of $420 million to $450 million, adjusted EBITDA is expected to be in the range of $70 million to $80 million and non-GAAP EPS is expected to be in the range of $0.85 to $1.05 per share. Non-GAAP tax rate is expected to be 11% to 13% and shares outstanding should be approximately 42 million. Finally, I’d like to mention that these guidance ranges assume our factory and supply chain remain in production for the balance of fiscal Q3.
I’ll now turn the call back to the operator to begin the Q&A. Operator?
Questions and Answers:
Operator
[Operator Instructions] Your first question comes from the line of Amit Daryanani with Evercore.
Michael Fisher — Evercore ISI — Analyst
Hey guys. This is Michael Fisher on for Amit. Thanks for taking my question and congrats on a great quarter. I just wanted to — I’m wondering if you can kind of give us an idea of the magnitude of both the freight headwind and then also the capacity expansion. I think you mentioned it’s something that will carry on for at least a couple of more quarters until your supply chain normalizes. So just give us an idea of maybe the quarterly run rate if that’s where we expect it for the next couple of quarters.
Chuck Boynton — Executive Vice President and Chief Financial Officer
Certainly, Michael. Thank you. This is Chuck. Freight — as we said in the last call, the freight costs globally have gone up by three to five times what they were pre-pandemic. And so what we’ve seen in terms of incremental freight costs over last quarter was up about $5 million over last quarter and last quarter, I think, it more than doubled from the prior quarter. So I don’t want to get into the details per se. But it’s a pretty significant headwind. We don’t expect any near-term changes this quarter or next quarter, but we do expect over time as the supply chain stabilizes for freight to get back to where it was and ultimately should help margins.
In terms of capacity expansion, in the last two quarters we’ve hired over 2,000 additional people in our factory in Mexico and we’ve expanded lines in contract manufacturers. And what we’ve seen is a record quarter ever for Plantronics for Enterprise Headsets and a record quarter, at least since the acquisition, of video endpoints. So I won’t get into the exact levels of details on capacity size and whatnot. That’s very strategic information. But we have radically expanded capacity, but we’re still not quite meeting the exact demand.
Michael Fisher — Evercore ISI — Analyst
Okay. And then just talk [Phonetic] about video strength. You obviously mentioned the education was a tailwind. I am just curious because I guess some people would think of this maybe as more of an on-prem in the office solution. So, are you seeing Enterprises equipped huddle rooms for the eventual return to work or is this getting some home office setups as well?
Dave Shull — President and Chief Executive Officer
This is Dave. I think there’s a couple of factors here. On the education side, it’s obviously a fairly specific use of the product. And it’s really sort of, what I would call, almost a hybrid consumers/enterprise usage, given that it’s being used by teachers, some of which is at home, some of which is in the classroom, broadcasting to the homes.
A lot of the other video demand is being driven by, what I would call, some preparation of people coming back to the huddle rooms on a video basis as opposed to just a voice basis. And so it’s sort of a mixture across the board there.
Michael Fisher — Evercore ISI — Analyst
Thanks for [Phonetic] taking the question.
Mike Iburg — Vice President, Investor Relations
Thanks, Mike. Operator, next question.
Operator
Your next question comes from the line of Greg Burns with Sidoti.
Gregory Burns — Sidoti & Company, LLC — Analyst
Good afternoon. I think last quarter you talked about your outlook for free cash flow or maybe operating cash flow for the year. Has that changed at all? Do you still expect — what are your expectations in terms of the full year in terms of cash generation?
Chuck Boynton — Executive Vice President and Chief Financial Officer
Yeah, Greg. Thanks for the question. Last quarter we had outlined about $150 million of free cash flow for the year. We don’t have any updates to that. I think that’s still a good planning number. We did highlight this quarter came in stronger from a cash standpoint than we had expected. We thought cash would be a little lower this quarter but it was a quite strong cash quarter based on the robust sales.
In Q3, we see cash being a little more challenged because the revenue growth will have some cash tied up in working capital. But then in Q4, we expect that profile to change and that cash to hit the balance sheet. And so we expect Q4 to be a quite strong cash quarter.
Gregory Burns — Sidoti & Company, LLC — Analyst
Okay. And then as you look at delevering the balance sheet further, is there like any kind of a target? Is there like a commitment to just quarterly cash flow and put that all towards debt repayment? Like how should we think about the pace of delevering?
Chuck Boynton — Executive Vice President and Chief Financial Officer
Yeah, we’re not being as specific as that. I mean clearly we want to — our capital allocation priority is delevering. We are spending some money in capex to expand lines and increase production. But we are really trying to allocate all of our excess cash to delevering. But we have not outlined sort of a formula saying all free cash flow will delever. I think this quarter, given where we expect cash to end, we’ll be opportunistically retiring debt and look sort of quarter by quarter. But clearly, our focus is paying down the debt as fast as we can given the other uses of capital for factory expansion and running the business.
Gregory Burns — Sidoti & Company, LLC — Analyst
Okay. And in terms of the supply constraints and the manufacturing constraints, your bookings outpacing your current production levels, do you feel like you’ve lost — at least just like it has delayed sales or do you feel like you’ve lost business to competitors because of the lack of capacity? What’s your view on that?
Dave Shull — President and Chief Executive Officer
This is Dave jumping in. I think there is probably two categories of demand. There is what I would call sort of prosumer consumer demand where some of our lower video products such as EagleEye Mini and some of our headsets would probably play. We’ve seen tremendous demand there. We have a backlog there. We’re probably losing some demand to our competition as a result of supply constraints. On the other hand, I know that with regard to specific products we’re seeing in the market that they have constraints as well.
I think with regard to the higher-end enterprise products, there is tremendous demand. A lot of those are being sold into our large-scale enterprise customers through our distribution channel and so obviously there’s a lot of loyalty to our product base there because of the quality, security compliance, all of factors that I mentioned during my comments. So I think yes on the Consumer side, probably not much in the Enterprise side.
Gregory Burns — Sidoti & Company, LLC — Analyst
Okay. And in regards to your comments around cost controls and keeping an eye on spending, is there a target for where you want to get the operating margins for the overall business?
Dave Shull — President and Chief Executive Officer
Yeah. We’re not quite ready to share to be honest. I mean, I think if you look at our competition and benchmark us, we’re below where I believe we should be, right. And so I guess give me another quarter or two, I’d like to be a little bit more specific with regard to the cost changes that we’re making before we execute there. At this point, as I said, my first priority is growth and making sure that we’re all hands on deck to capture the revenue demand here and not to try to confuse the Company with the priorities.
Gregory Burns — Sidoti & Company, LLC — Analyst
Okay. Thank you.
Mike Iburg — Vice President, Investor Relations
Thanks, Greg.
Operator
Your next question comes from the line of Meta Marshall with Morgan Stanley.
Eric — Morgan Stanley — Analyst
Hello, team. This is Eric [Phonetic] on per Meta. Thanks for taking our question and congrats on the quarter. Maybe just a quick one for us. You mentioned kind of a number of new products and capacity investments. But as we’re thinking about just the distribution and sales side, are there other kind of channels that you would need to invest in from a go-to-market perspective to kind to be able to capture more of the direct to consumer demand or is that all built out and is that part of I guess investments in growth as well?
Dave Shull — President and Chief Executive Officer
So I think we’ve spent the last couple of quarters rebuilding the current channel and some of that channel, as you know, has distribution through Amazon and other e-commerce channels. So I think just making that smoother and getting the inventory where it needs to be to meet that demand has been priority number one. But absolutely, I think there is a place for us to do some further investment with regard to e-commerce a bit more directly into some of those channels. It’s not really targeting consumer, it’s much more I think the buying pattern for enterprises has changed. And as we all figure out how to go back to work on sort of a hybrid basis, there will be this sort of a Bring Your Own Device model. And so we want to make sure that we address that demand directly as well. But we’re doing it with sort of the endorsement of our enterprise CIO partners. So, yes, there is an investment required. But it’s something that’s tied, very, very directly to demand as you might imagine.
Eric — Morgan Stanley — Analyst
Got it. That makes sense. And then maybe kind of on that changing buying pattern. Is there a shift in just how tied maybe a headset in a video sale is? Whether were those purchases historically more separate and you’re kind of seeing more demand for a full solution? I think last quarter you kind of mentioned that, but just wondering if it applies also more to in the office as well as maybe some of the bundling, I think, you mentioned in the last quarter.
Dave Shull — President and Chief Executive Officer
Yeah, I think so. It’s early days for all of those trying to figure this out, right. But we’re certainly seeing demand for some of the new video products that we put out there, the Studio X products, which gives you a very sophisticated codec for sort of a huddle room situation, but you can also use them at home tied to a TV, you can also then tie that to some of the other audio products that we have whether it’s a handset or the Sync devices.
And so I think that’s sort of integrated use of our products is going to become even more popular and so we’re monitoring that very closely and making sure that we build that out to make it easier to purchase.
Eric — Morgan Stanley — Analyst
Thank you.
Operator
[Operator Instructions] Your next question comes from the line of Liz Pate with Cowen.
Liz Pate — Cowen and Company — Analyst
Hi, guys. Thanks for taking my question. Chuck, maybe just to follow up a little bit on the backlog. Maybe you can just talk about how long you expect the supply constraints to last. Is it another quarter or two or is it just impossible to tell at this point?
Chuck Boynton — Executive Vice President and Chief Financial Officer
Yeah, I would say, Liz, in general, it’s hard to tell. We have decreased the lead times. So we feel better that now we’re getting product to our customers faster. And I think there is a dynamic happening where the aggregate backlog is actually up just a little bit from where it was at the end of last quarter, but the weeks have gone down because revenue has grown, the supply chain has grown.
We’d always like to have some backlog. So backlog is a good thing. We want to have backlog. Today we have too much for certain categories. And I would expect that hopefully by Q1, we’d be at normal lead times for all products. But we don’t know exactly because it’s partially — it’s demand driven. So I’d say probably we will not be out of the woods by the end of March. But I would expect to be out of the woods in sometime in the June quarter for sure.
Liz Pate — Cowen and Company — Analyst
Okay. Are there certain components that are particularly tight or is it more just labor intensive issues?
Chuck Boynton — Executive Vice President and Chief Financial Officer
It’s both. So there are constraints on PCBs and ICs, chips and whatnot. There are also physical constraints on molds for the components that we make and our contract manufacturers make. So we have done quite a bit of capital investment in increasing the ability to make more. But we also don’t want to overshoot and over invest and then have another issue. So we are being very thoughtful in how we expand because the lead times are quite long in some cases. So I would say the answer is both.
Liz Pate — Cowen and Company — Analyst
Okay. Great. Good problem to have. Thanks.
Chuck Boynton — Executive Vice President and Chief Financial Officer
Thank you. Liz.
Dave Shull — President and Chief Executive Officer
Thank you, Liz.
Operator
And you do you have a follow-up question from the line of Greg Burns with Sidoti.
Gregory Burns — Sidoti & Company, LLC — Analyst
Hi. I just wanted to dig into the — some of the integration issues you mentioned when you were putting together Polycom and Plantronics, particularly in the Enterprise Headsets side. I know you’ve been still implementing a lot of changes, brought in some new leadership and tried to rectify some of the issues. Can you discern whether those are having a positive impact? Yeah, it’s kind of hard to tell, given obviously the work from home demand has been so strong. So maybe we’re not seeing explicitly some of the benefits of those changes. But is there any way to discern whether you are seeing green shoots or positive — the positive impacts from those changes yet?
Dave Shull — President and Chief Executive Officer
So, Greg, this is Dave Shull. So it’s day 50 for me. So let me give you sort of a very high-level view based on my conversations so far and then Chuck can provide a little bit more of a historical view. The issues that I’ve heard from our distributors and our resellers and the end customers have been twofold, I guess, right. One has been with regard to the sales friction. It’s been — we’ve had a very complicated sort of pricing, contracting and rebate model. And that’s been an evolution that’s taking quarters — multiple quarters to fix.
And when I’m talking to them we’ve done a series of round robins with all the distributors or resellers around the world and there is still issues of complaint. I won’t expect anything less. These guys are aggressively running their own businesses. And so we still have things that we need to fix. But I’m also hearing acknowledgment that we’ve made a lot of progress versus what it was a couple of quarters ago. So I highlight sort of Carl Wiese and sort of the sales team in terms of the plans that they have put in place there.
Chuck Boynton — Executive Vice President and Chief Financial Officer
And it’s Chuck. I would just add. Bob and I mentioned last quarter, I think, some of the systems issues. A lot of those have been sorted out. We’ve done a lot of work on having systems that enable that agility that — and nimbleness that Dave was talking about. And then we have hired additional specialists. And I think the team has done a really good job working with our distribution partners and resellers to get them the tools they need and then having the right account coverage and specialty in the field. And so the team is performing really, really well. A lot of the team is new, but they are performing quite well.
Gregory Burns — Sidoti & Company, LLC — Analyst
Okay. Great. Thank you.
Mike Iburg — Vice President, Investor Relations
Thanks, Greg.
Operator
And there are no further questions at this time.
Dave Shull — President and Chief Executive Officer
Thank you all very much for the time. We look forward to getting to know many of you in person here shortly, or at least, virtually, so to speak, and look forward to keeping you updated on the turnaround. Thank you, all.
Operator
[Operator Closing Remarks]