Tigo Energy Q4 2024 Earnings Call Transcript

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February 11, 2025
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Operator

Good afternoon, and welcome to the ATEGO Energy's Fiscal Fourth Quarter and Full Year twenty twenty four Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Joining us from Tigo R. Svi, Alon, CEO and Bill Rochelein, CFO.

Operator

As a reminder, this call is being recorded. I would now like to turn the call over to Bill Rochelein, Chief Financial Officer. Please go ahead.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Thank you, operator. We'd like to remind everyone that some of the matters we'll discuss on this call, including our expected business outlook, our ability to increase our revenues and become profitable, and our overall long term growth prospects, expectations regarding recovery in our industry, including the timing thereof, statements about our demand for our products, our competitive position and market share, our current and future inventory levels, charges and reserves, and their impact on future financial results, inventory supply, and its impact on our customer shipments and adjusted EBITDA for the first fiscal quarter twenty twenty five, and our revenue for the first fiscal quarter and full year of 2025 and 2024 and our ability to penetrate new markets and expand our market share, including expansion in international markets and investments in our product portfolio, are forward looking and as such are subject to known and unknown risks and uncertainties, including but not limited to those factors described in today's press release and described in the Risk Factors section of our most recent annual report on Form 10 ks and other reports we may file with the SEC from time to time. These risks and uncertainties could cause actual results to differ materially from those expressed on this call.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

These forward looking statements are made only as of the date when made. During our call today, we will reference certain non GAAP financial measures. We include non GAAP to GAAP reconciliations in our press release furnished as an exhibit to our Form eight K. The non GAAP financial measures provided should not be considered a substitute for or superior to the measures of financial performance prepared in accordance with GAAP. Finally, I would like to remind everyone that this conference call is being webcast and a recording will be made available for replay on Tygo's Investor Relations website at investors.taigoenergy.com.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

With that, I'd like to now turn the call over to Tygo CEO, Zvi Alon. Zvi?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Thank you, Bill. To begin today's discussion, I will highlight key areas in our recent performance to wrap up the past year and provide some commentary on recent operational highlights before turning the call over to our CFO, Bill Roschlein. He will discuss our financial results for the fourth quarter in more depth as well as provide our guidance for the first quarter of twenty twenty five and full year of 2025. After that, I will share some closing remarks, tell you about our outlook for the year 2025 and then open the call for questions from our analysts. Let's get started.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

I am pleased to report that we ended 2024 with yet another sequential quarterly revenue growth, making it four out of four for the fiscal year. Given how 2023 ended, I'm exceptionally proud of what our team at Tiger has managed to accomplish. To give some geographical color on the results, we saw positive sales growth, especially within the EMEA and Americas regions during the quarter. Expanding our sales footprint into markets and doubling down our efforts in key markets has remained an area of focus for us. To share only a few recent highlights, our team has spent time in Malaysia and Hawaii to educate, train and sell our product portfolio.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

In the fourth quarter of twenty twenty four, we shipped 480,000 MLP units bringing our twenty twenty four MLP shipped total to 1,500,000 units. Our Tier four X product line continues to build momentum in the marketplace, and we expect this trend to continue in 2025. Additionally, we achieved multiple utility scale wins in 2024, and our pipeline in this sector of the market continues to grow. Another key focus area is within our AI software solution, where our Predict plus AI based energy consumption and production platform continues to grow. We announced yesterday, since the first quarter of twenty twenty four, Predict plus platform has grown from 15,000 to 140,000 meters under management and covers a total of 600 gigawatt hour of energy at year end.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

As Predict plus expands into Europe and North America, we are bringing machine learning to energy analytics and predictions to a new standard for energy forecasting. Our annual recurring revenue, or ARR, now stands above $1,000,000 per year, and we expect it will continue to grow in 2025. Additionally, we just recently announced another great milestone. Since the inception of the program, GreenLab has now reached 1,000 site arrangements engagements globally, including over 700 C and I installations and over 300 residential solar installations. We are excited to see our efforts towards the total quality solar starting to pay off.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

And with that, I would like to turn it over to Bill. Bill?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Thank you, Zvi.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Before I start reviewing the results of the fourth quarter, I would like to address the inventory reserve charges that are significantly impacting many line items in our income statement as they are accounted for in the cost of revenue. In 2024, our GoESS Storage and Solutions business represented 6% of total sales compared with 9% of total sales in the prior year, reflecting the fact that this business line has not participated in our business recovery as well as we had anticipated. As you may be well aware of, this segment of the market has many markets participants competing for market share and battery prices in particular continue to fall at a significant rate, all of which negatively impacts companies holding high inventory positions. As mentioned in our previous earnings call, the charges taken in both the third and fourth quarters reflect management's estimate of the inventory's net realizable value and incorporates current and future expectations of the market environment. Now turning to the financial results for the fourth quarter ended 12/31/2024.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Revenue for the fourth quarter of twenty twenty four increased 86.8% to $17,300,000 from $9,200,000 in the prior year period. On a sequential basis, revenues increased 21.3% with improved results coming from many countries in the EMEA and Americas regions, including The U. S. And Germany, along with some recovery in Italy. By region, EMEA revenue was 11,200,000 or 65% of total revenues and a 29.3% sequential increase.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Americas revenue was $4,600,000 or 27% of total revenues and a 57.2% sequential increase. And APAC revenue was $1,500,000 or 9% of total revenues and a decline of 44% sequentially. Gross loss in the fourth quarter of twenty twenty four was $12,600,000 or negative 72.7% of revenue compared to gross profit of $2,900,000 or 31.1% of revenue in the comparable year ago period. The year over year decline was primarily due to the previously mentioned inventory charge of $19,500,000 Operating expenses for the fourth quarter declined 29.8% to 11,600,000 compared to $16,400,000 in the prior year period. The decline was driven primarily by our previously announced cost cutting efforts.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Operating loss for the fourth quarter increased by 77.9% to $24,100,000 compared to $13,500,000 in the prior year period. GAAP net loss for the fourth quarter was $26,800,000 compared to a net loss of $14,800,000 in the prior year period. While we recorded a higher net loss on a GAAP basis for the fourth quarter compared to the prior year period, absent the inventory charge, our results reflect progress towards profitability on a non GAAP basis. Adjusted EBITDA loss in the fourth quarter increased 90.4% to $2,022,100,000.0 dollars compared to an adjusted EBITDA loss of $11,600,000 in the prior year period. As a reminder, adjusted EBITDA is a non GAAP measure that represents net loss as adjusted for interest and other expenses, income tax expense, depreciation, amortization, stock based compensation and M and A transaction expenses.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Primary shares outstanding were $60,800,000 for the fourth quarter of twenty twenty four. Turning to the balance sheet, accounts receivable net decreased this quarter to $8,000,000 compared to $8,800,000 last quarter and increased from $6,900,000 in the year ago comparable period. Inventories net decreased by $24,800,000 or 53% to $22,000,000 compared to $46,800,000 last quarter and $61,400,000 in the year ago comparable period. Cash, cash equivalents and short and long term marketable securities totaled $19,900,000 at 12/31/2024. On a sequential basis, cash increased by $400,000 as we continue to make progress on reducing our inventory and working capital.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Turning now to our financial outlook for our first quarter of twenty twenty five and full year of 2025. As a reminder, Tiago provides quarterly guidance for revenue as well as adjusted EBITDA as we believe that these metrics to be key indicators for the overall performance of our business. For the first quarter of twenty twenty five, we expect revenues and adjusted EBITDA to be in the following range. We expect revenues in the first quarter ended 03/31/2025, to range between $17,000,000 and $19,000,000 We expect adjusted EBITDA loss to range between $2,500,000 and $4,500,000 For the full year of 2025, we expect revenues to range between $85,000,000 and $100,000,000 That completes my summary. I'd like to now turn the call back over to Zvi for final remarks.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Thanks, Bill. As we look ahead, I can say that the industry still faces headwinds, but our track record over the past year 2024 makes us believe that our robust product portfolio solutions allows us to mitigate the industry and market pressure better than others. As demand of our solutions continue to return, we expect revenue to increase steadily throughout the remainder of 2025. After four quarters of sequential top line growth, we believe we have enough visibility into what's ahead for the company to carefully provide an outlook for the fourth quarters ahead of us. We anticipate that our quarterly revenues to continue to improve throughout 2025.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

We firmly believe in the growth prospects of our business and look towards for providing additional updates in the coming quarters. With that, operator, please open the call for Q and

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

A.

Operator

Thank you.

Operator

Our first question comes from Eric Stine with Craig Hallum Capital Group. Your line is open.

Eric Stine
Senior Research Analyst at Craig-Hallum Capital Group LLC

Hi, Steve. Hi, Bill.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Hello. Hi.

Eric Stine
Senior Research Analyst at Craig-Hallum Capital Group LLC

Hello. So maybe just on the adjusted EBITDA, I know you called out the charge ex that a loss of $2,600,000 Can you just remind, when you previously guided, were you expecting or factoring a charge into that just noteworthy that at the midpoint excluding the charge you outperformed by $5,000,000

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Yes, correct. In the last call, we did say in our guidance that the EBITDA guidance reflected an expectation of additional inventory reserves. That being said, the amount of the inventory reserve ended up being higher than we had initially anticipated during that call. But we feel that the reserve taken is both adequate and necessary as we move forward.

Eric Stine
Senior Research Analyst at Craig-Hallum Capital Group LLC

And sticking with the charge, I mean, do you feel like this kind of covers it? I mean, you're not expecting I mean, I guess from the guide, it would imply that you're not expecting a charge in Q1 at least?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Right. So, yes, as part of the annual audit, obviously review process, we have to look at the balance sheet in terms of valuation. And at this point, with the reserve taken, we've reserved 90% of the Energy Storage Solutions business inventory. We're left with a net book value somewhere in around the $2,100,000 range, which we think is adequate and justified given what we expect to sell.

Eric Stine
Senior Research Analyst at Craig-Hallum Capital Group LLC

Got it. Okay, that's helpful. And then just looking at OpEx, looks like it came down a little bit more. I'm just curious as you think about fiscal twenty twenty five guidance and maybe where you are exiting the year. I mean, do you have I know in the past you've given some quarterly revenue targets for cash flow positive and EBITDA positive.

Eric Stine
Senior Research Analyst at Craig-Hallum Capital Group LLC

Are those things that you are able to update on this call?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Yes, certainly. So in general, we look to keep the cash OpEx, which is looking at the OpEx and taking out the EBITDA adjustments, stock based comp and amortization, depreciation to come up with an OpEx number that is sub $10,000,000 in this past quarter was around a little bit less than $9,500,000 There was going to be a little bit of lumpiness with Q1 where we have the annual audit and expenses related to that. And then we have some ebbs and flows as it relates to some litigation expense. But we believe that after Q1, we are able to take the OpEx further down somewhat and with some assistance with the OpEx being lower along with kind of not having the continual drag of reserving inventory, which if you recall in Q1, Q3 and Q4, we had reserves. And so for primarily for the Go ESS Solutions product, absent that our margins were mid-30s to Q4 was actually 40%.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

So taking that forward, our outlook for breakeven EBITDA is more like $25,000,000 to $28,000,000 dollars at that mid 30% to high 30% gross margin range. And our guidance of $85,000,000 to $100,000,000 is 8.5% to 15.5% sequential growth, which is fairly consistent with what we've delivered thus far. If you recall, Q2 was about 30%, Q3 twelve %, Q4 twenty one point three %. And so within that range, we expect second half profitability on an adjusted EBITDA basis. And you can see that at the low end 85% that would suggest somewhere more like late Q3, Q4, but the high end that could be Q2, Q3.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

So if you want to take the midpoint of the guidance, we would still expect to see EBITDA profitability in the second half of Q3 to be specific. It would be based on our business model going forward, which is $25,000,000 to $28,000,000 with mid-30s margins. And that's what we're tracking to and that's also what we're we've been delivering in these past two quarters.

Eric Stine
Senior Research Analyst at Craig-Hallum Capital Group LLC

Okay. That's great. Thanks a lot.

Operator

One moment for our next question. Our next question comes from Phil Shen with Roth Capital Partners. Your line is open.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Hey guys, thanks for taking the questions. First one is on the '25 guidance. Can you share what you expect the geographic mix to be? I know for Q4, it was roughly two thirds EMEA and then Americas 20 7 Percent and then APAC9. Would you expect that to maintain as we go through the year?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

So the answer is in general, the answer is absolutely yes. In the 65% to plus for EMEA and in the 30% give or take for North America. We've seen as I said before, we've seen an increase in those two regions also in the last quarter.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Okay. Thank you, Steve. And then in terms of EMEA, I think on the last call, you talked about the top three countries being Germany, Italy and The UK. What were the top countries in EMEA for you in Q4? And then as we go through 2025, what would they be?

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Thanks.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

It's pretty much the same. It's Germany, The UK and Italy. We have not seen any recovery in The Netherlands, as an example. We do see some interesting activity in Eastern Europe, But the main the top three countries are Germany number one and UK and Italy. Got it.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

And so what is your outlook for each of these countries overall? Our sense is Germany might be a little bit flattish. I think WoodMac was sharing with us in a recent webinar that it could be down 5% in 2025, after being down 20% in 2024. So but they do see Germany being down significantly in 2026 and beyond. So with Germany being such a big segment or kind of slice, how do you how would you expect to navigate that?

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Maybe you disagree with the WoodMac team as well. So can you share the outlooks for these countries? Thanks.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

We actually see in Germany a robust market, and it continues to be strong for us. The indications we are getting from the distribution is that at the level that we have been running and increasing, they maintain that they see the same continuing for the rest of the year for us. And also the other side, which is also impressive for us is UK. UK is really coming very strong for us.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Great. Okay. Thanks. And then in terms of The U. S.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Outlook, there been there's a big debate on Powerwall three and the ramp up and how that can take share from inverters and storage companies. And so I was wondering, is there an opportunity for you to pair your optimizers with the internal Powerwall three inverter? So have you is that I mean, is that something that is workable now and is that an opportunity for you? I see with the Section 48E rules that require separation to get the domestic content adder for solar and storage. It seems like there could be something there for you guys.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

What are your thoughts?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Yes. I can tell you, we have seen an increase in requests from customers to go with the POWEROL three to use it with our product. And so we are paying attention to it and we are doing our best to make sure that we obviously comply with Tesla to support it. And we do have a good number of installations already with Powerwall three. So we know that in the market, it's actually working well and we will see how it continues.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Okay. So are you being paired up for with your fire safety device or is it more your optimizer or?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Actually the optimizer. Actually it's a higher price unit.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Great. Okay. So are you able are you qualified to work with the Tesla inverter only product?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

We have installations. You mean the Powerwall two or yes?

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

No, meaning Tesla also sells an inverter that is separate from storage. And so I was wondering if you're able to be matched up with that.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

So the answer is yes, we can. The optimizers can.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Okay, good. So that is maybe an opportunity now that there's the Section 48E requirement to separate solar and storage again for domestic gas. So great. And then shifting, can you share what you think you've talked about the PREDICT plus and the opportunity there and that that's growing for you. Most of your business historically has been DG distributed generation.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

And so when you think about your revenue mix for '25, what is the split between utility scale solar and DG? My guess is utility scale solar is a very small percentage, maybe sub-10s, five ish or so, but was wondering if you think that can grow to a much bigger percentage near term? Thanks.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

So as I said in my remarks, we have seen an increase in large scale installations. And the two we mentioned was the 142 megawatts in Spain, which used 100,000 of our devices. And we also announced another very large scale, 97,000 devices in Brazil. And we don't even release any information on systems which are in the 10 megawatts, 15 megawatts, 20 megawatts and above. We do see an increase in demand and requirements for those larger systems.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

I don't want to yet predict percentage wise from the total, but I can tell you it is becoming a more significant component for us. And this is it's true not just in The U. S. And Europe. We have seen most of our installations in Asia Pacific, the majority are C and I and small utility scale systems.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

And these are direct sales, right, Zvi, it's not through distribution?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

The majority are direct sales. Sometimes we do deliver to the distribution, but the majority are direct sales.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Okay. And then is the margin profile of the direct sales comparable to your sales into distribution or is it a little bit lighter given the volume?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

So what's beautiful about our product, Phil, is that it's the same product that we sell to the residential and to the lounge systems and our pricing is not changing. It's the same. Actually, we've kept this price of the unit equal for the last four, five years. We didn't change it. We didn't lower the price of our product.

Philip Shen
Managing Director, Senior Research Analyst at Roth Capital Partners, LLC

Great. Okay. Well, look forward to following that story as well. Thanks for taking my questions. I'll pass it on.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Thank you.

Operator

One moment for our next question. Our next question comes from Sameer Joshi with H. C. Wainwright. Your line is open.

Sameer Joshi
Senior Equity Research Analyst at H.C. Wainwright & Co., LLC

Hey, good afternoon.

Sameer Joshi
Senior Equity Research Analyst at H.C. Wainwright & Co., LLC

Many of my questions have been answered, but just digging a little bit into the gross margins. I think, Bill, you did mention in response to one of the questions that probably your fourth quarter gross margins were over 40%. And so going forward, do you expect that level of margins? Because I think you've guided mid-30s as during the commentary as well. So just was wondering whether 40% was sort of because of some kind of a product mix or some other reason?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

I think between thirty five and forty is where we're tracking. One quarter doesn't make for a trend, but Q3 again, ex reserve was 36.5% Q4 ex reserve was 40.2%. So we are there are our trend and our product set is set up for that mid third, mid to upper 30s figure. And so we're comfortable with that range. The inventory reserve that we've had to take over the past few quarters have dampened that and eliminating uncertainty around that helps to better explain what the underlying margin should be like and that's what they that's where they are.

Sameer Joshi
Senior Equity Research Analyst at H.C. Wainwright & Co., LLC

Understood. And then larger picture, you have given guidance for 2025 and maybe we can understand the 1Q guidance. You probably have good very, very good visibility on it. But for the year, what is the level of your confidence and what areas are you looking at when you're looking at this buildup, revenue buildup?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

Yes. So, we've got four quarters behind us here of sequential growth and coming out of the downturn in Q1, we had 6.5 growth, Q2 '20 '9 point '6 percent, Q3 '12 point '1 percent, Q4 '20 '1 point '3 percent. So we're giving a conservative, a realistic range here of a low point of $85,000,000 being 8.5% sequential growth up to $100,000,000 being 15.5%. So just look at what we've done over the last four quarters, you can see that I think we've done our best job to incorporate the highest probability of outcomes in 2025. And the book of business continues to remain strong for us.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

And so we've got confidence that the range we're providing is a good range.

Sameer Joshi
Senior Equity Research Analyst at H.C. Wainwright & Co., LLC

Got it. And just one last one, is there any impact likely impact of any tariffs that might materialize over the next few quarters that will impact your margins?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

So that is a you never say never question, but we moved our production for the most part, a lot of it to Thailand back in 2017, '20 '18 when we went through version Trump version one. And we have not had any indication that any of our products would be targeted in any way at this point. So best I can answer is that way.

Sameer Joshi
Senior Equity Research Analyst at H.C. Wainwright & Co., LLC

Got it. Thanks for taking my questions and congrats on the progress.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Thank you.

Operator

At this time, this concludes our question and answer session. I'd like to turn the call back over to Mr. Alad for his closing remarks.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Thanks again, everyone, for joining us today. I especially want to thank our dedicated employees for their ongoing contribution, as well as our customers and partners for continued hard work. I also want to thank the investors for their continued support. Operator?

Operator

Thank you for joining us today. Thank you for joining us. One moment, we do have another person in the queue for a question. Our next question comes from Gus Richard with Northland. Your line is open.

Gus Richard
MD & Senior Research Analyst at Northland Capital Markets

Yes. Thanks for asking. Thanks for letting me ask questions. Sorry to be a 05:00 Charlie. Just real quick on the gross margins, I think that's a record for you all.

Gus Richard
MD & Senior Research Analyst at Northland Capital Markets

And I just was wondering what drove such strong performance in gross margins in the quarter?

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

There's a couple of points. We continue to improve our cost and our product. And so a lot of work continues to go into costing down the cost of the product and we continue to expand margin. And that's just a continual process that we do. We've introduced the X as well and the X provides a very healthy margin.

Bill Roeschlein
Bill Roeschlein
Chief Financial Officer at Tigo Energy

And so the family of TS4 for us is just on a variable basis, very attractive margins. And so when you get a quarter where you're selling most of most product is these TS4s, you're going to get the high margin that you're seeing here.

Gus Richard
MD & Senior Research Analyst at Northland Capital Markets

Got it. And then, you recently signed or got on an approved vendor list at a large company. And I'm just wondering, is some of the visibility that you're getting just channel full for that customer? Or I just want to sort of wrap my mind around the visibility for the full year given how dynamic the environment is.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

So our visibility, I guess, if we talk about EMEA, it's coming from the three countries I mentioned with the very strong distributors and very sizable distributors there, which provides us confidence as far as the continuation. Obviously, we've seen also an increase in footprint in The U. S. And no, we did not rely just on this last one we signed, even though it will be a contributor as it evolves and continues to grab additional footprint within our offering. But my point is that the visibility is not just based on that one.

Gus Richard
MD & Senior Research Analyst at Northland Capital Markets

Got it. And then just last one for me. In terms of sell in versus sell out and the health of the channel, can you just comment on what you see geographically?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

I can tell you that I believe that 100% of all the orders we've received for the last two plus quarters are brand new into inventory, which is getting depleted almost in no time. So we don't have much leftover or any additional inventory in the channel.

Gus Richard
MD & Senior Research Analyst at Northland Capital Markets

Okay. All right. Thank you for squeezing me in. Sorry again for being late.

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Most welcome.

Operator

Mr. Alon, were you finished with your closing remarks?

Zvi Alon
Zvi Alon
Chairman & CEO at Tigo Energy

Yes, I am.

Operator

Okay. Well, I just want to thank everyone for joining us today for TAGL's fourth quarter twenty twenty four earnings conference call. You may now disconnect and have a wonderful day.

Executives
    • Bill Roeschlein
      Bill Roeschlein
      Chief Financial Officer
    • Zvi Alon
      Zvi Alon
      Chairman & CEO
Analysts
    • Eric Stine
      Senior Research Analyst at Craig-Hallum Capital Group LLC
    • Philip Shen
      Managing Director, Senior Research Analyst at Roth Capital Partners, LLC
    • Sameer Joshi
      Senior Equity Research Analyst at H.C. Wainwright & Co., LLC
    • Gus Richard
      MD & Senior Research Analyst at Northland Capital Markets
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Key Takeaways

  • Atego ended FY24 with four sequential quarterly revenue increases, reporting Q4 revenue of $17.3 M, up 86.8% year-over-year and 21.3% sequentially, driven by EMEA (+29.3%) and Americas (+57.2%) growth.
  • A $19.5 M inventory reserve in Energy Storage & Solutions led to a Q4 gross loss of $12.6 M, but on a non-GAAP basis ex-reserve gross margin was ~40%, reflecting improved product mix and cost efficiencies.
  • Operating expenses fell 29.8% year-over-year to $11.6 M, yet Q4 Adjusted EBITDA loss widened to approximately $20 M; management targets breakeven Adjusted EBITDA at $25–28 M quarterly revenues with mid-to-high-30s% gross margins.
  • For Q1 FY25, Atego guides revenue of $17–19 M and an Adjusted EBITDA loss of $2.5–4.5 M, and full-year FY25 revenue of $85–100 M, implying 8.5–15.5% sequential growth and H2 2025 Adjusted EBITDA profitability.
  • Product and operational highlights include shipping 480 K MLP units in Q4 (1.5 M units in FY24), momentum in the Tier 4X line, and growth of the Predict+ AI platform to 140 K meters under management covering 600 GWh, driving over $1 M in ARR.
AI Generated. May Contain Errors.
Earnings Conference Call
Tigo Energy Q4 2024
00:00 / 00:00

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