Hello, and welcome to the Aviat Networks investor call. All participants are in a listen-only mode. I will now turn the call over to your host, Andrew Fredrickson, Interim Chief Financial Officer. Please go ahead. Thank you, and good afternoon, everyone. Thank you for joining this Aviat Networks investor call. On the call today for Aviat is Pete Smith, President and Chief Executive Officer, as well as myself. An archived webcast of today's call will be available on the company's investor relation website. During the call, management may make forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from management's current expectations. Additional information on factors that could cause actual results to differ materially can be found in the company's annual report on Form 10-K filed with the SEC on September 10, 2025. The company undertakes no obligation to revise or make public any revision of these forward-looking statements in light of new information or future events. I will now turn the call over to Scott Searle, Senior Research Analyst at Roth, for an additional disclosure. Okay, thank you so much. Just real quickly, Roth makes a market in shares of Aviat Networks, and as such, buys and sells from customers on a principal basis. With that, Andrew, Pete, thank you so much for having me and allowing me to conduct this fireside chat. Yeah, great to be here, Scott. Thanks. We're going to cover a couple of things in the call. There is an 8-K out and a new presentation, and there are some details that we'll talk about in that presentation. But first, Pete, why don't we start from a high level in terms of where do you see the growth opportunities in the Aviat microwave business right now? Kind of give us a quick update on what we're seeing. Yeah, look, Aviat's principally a microwave business, and one of the complaints about microwave businesses is that it's GDP plus growth. We are well positioned for the segments that are growing greater than the GDP plus, one public safety. If you want to get a proxy for that, look at the Motorola and Axon research or their performance. When we look at the public safety budgets, we see mid-single digit growth, so great underpinnings of demand. Utilities, there's been 30 years of underinvestment in U.S. infrastructure, and I understand that there's a lot of hype around AI and data centers. Those all need power. Combined, public safety and utilities represent 35-40% of our business. We win there. We think we have a strong value proposition of security, reliability, and radio performance. The overall business, we see growth in private networks. We see the Apriso or 4RF business growing due to automation, machine-to-machine, IoT, and more SCADA. For where we play, we think we have the leading SCADA product on the market. We feel good about the growth drivers underpinning our business. Pete, maybe before going on to some other areas, I want to hit the utility side of the equation again. Good growth there, as you pointed out. There has been a lot of talk from a data center perspective, but underinvesting in the grid. Are you really seeing that translate into orders, and what is the competitive landscape on that front? We think in the U.S., this market for us is principally U.S. We're either one or two in terms of the competitors that serve utilities. It's project-oriented, and we're actually coming into the year-end. There could be use or lose it money, which will factor into the December quarter. I don't think it's particularly competitive. I think we have a good position. It's largely because of our security. Knock on wood, there's never been a problem with security breaches. What's driving the utility are grid security, grid security, productivity in the utility, and then particularly out West, wildfire detection. The wildfire detection and the security are driven by video, and the more video that's consumed, the more there's a need for backhaul. I would say, I think your question was getting at, have you seen new demand due to AI or data centers? Not yet. We think that that would be in front of us. Gotcha. Very helpful. Now, I want to get to some comments on rural broadband and dive in a little bit more on 4RF. But before we go there, what do you see in just in terms of the demand characteristics for tier ones and tier twos today? How is that pipeline and opportunity both domestically and internationally looking? Yeah, we think that the domestic demand is the CapEx cycle has bottomed. We see incremental improvements in the U.S. tier one space. We see episodic growth across the globe. We see a significant replacement cycle coming in India. If you read about Europe, the past couple of months, there's been this Danish network security issue. I think incrementally, Europe is getting more serious about the Huawei replacement cycle. Our funnel of opportunity for Huawei replacement has never been bigger. Lastly, the Pasalink acquisition, what we're seeing is that there is a replacement cycle or upgrade opportunity that will be both in hardware and software. Gotcha. Very helpful. Now, rural broadband, right? Starting to capture more of the mainstream headlines again, particularly with BEAD funding and getting through the next round of allocations. I think this week or in the last 24 hours, I think the NTIA actually approved 18 plans. So we're starting to see some of that BEAD money coming through. How are you seeing the rural broadband opportunity open up for you, and how does BEAD trickle down to that? Yeah. So we believe we have the best channel and radio combination in the industry. The reason is about seven years ago, we did not understand how to serve cost-effectively the small increments of demand in rural broadband. So we put together an e-commerce platform, and the e-commerce platform, in combination with our radio technology, has established ourselves as a leader for rural broadband. We have most of the large U.S. customers in rural broadband. Our e-commerce solution drives a margin accretive business set for us. If this grows, we are in good shape. Now, with respect to BEAD, we have been pessimistic to neutral for a long time, and we have been right in that conservatism. Now, we believe spending will start in the June or September quarter. It is difficult to discern which one of those two. What we're really encouraged about is we're engaged in project discussions with a variety of our customers, including our top couple. So whether it hits in June or in September and starts to ramp up, we are definitively encouraged. Gotcha. So you're actually having those engagements and those discussions today. Timeline to be determined, but actually active and productive. Correct. Okay. Very good. Moving forward on the BEAD front after many, many years for the industry. Now, 4RF, you've heard that before. Really exciting opportunity there. It's completely new, opening up new markets. You've brought 4RF into North America where it really didn't exist before. I'm wondering if you could talk a little bit about what's really driving the demand there, what kind of growth we should be thinking about. I know it's a small component of your business, but it's an actually exciting area for growth. Yeah. So the 4RF, which we call our Apriso product line, it's principally focused on utilities or what we would call the fixed segments, mostly utilities. What we've done in the first year, year and a half of ownership is cross-sell microwave to the 4RF utilities, the 4RF product to Aviat utilities. At the outset, we talked about public safety, and we believe that we're either number one or number two in U.S. public safety. With 4RF, in combination with some of our product development and our network management software, we've been able to start to do proof of concept and trials in emergency vehicles, right? That channel, we have either one or two in public safety. The person that's responsible for infrastructure procurement, public safety is not the one who buys cellular router, but usually they're one or two doors down. We have a stupendous reputation with respect to public safety, and now we're leveraging it with a new product. Just to follow up on the heart, this is traditionally what I think of as a Motorola stronghold. When I think of public safety, I think of cellular gateways and routers, right? Are you starting to kind of creep into that market opportunity and really gain some mind share in addition to some revenue opportunities? Yeah. Motorola is a very important customer to us. We are not in any way competing with them, but we are competing against in what we would say is an $850 million TAM market. We're competing against the likes of Cradlepoint/Ericsson and Sierra, right? And we think we have a distinct value proposition with respect to unique security features which come from our public safety and our utility business. We're starting from zero. We think there's 300,000 police cars in the U.S. Each of them has a router. What we've chosen to do is do POCs with 10 different state or large municipal governments and see where it goes. I think in the February earnings call, we'll update you with respect to progress, and hopefully we have a win to announce. Okay. Now, moving on to the fun aspect of the call today. In terms of the 8-K filing and the presentation, you had some updated slide in effect talking about MDUs. Can you kind of take us through what's changed, what's different, what you're seeing in terms of the opportunity there? Yeah. On slide nine of the investor deck, we described kind of the architecture of the MDU, right? If you go back to April, we were in some POC proof of concept trials, and those, not through our own effort, but they were by sleuths in the industry, found out that we were competing there. At the proof of concept stage, you have no guarantees. Since April and beyond, over the last seven months, we've worked to prove the technology at 28 GHz and 39 GHz. Very, very recently, since the earnings call, we have received our first order that will be used to support subscriber traffic, right? I draw that distinction because that makes it real. Up to this point, it was demonstrations or POC, and our customers were not making their money off of this. This order, when we deploy, will generate positive economics for our customers. Bottom line here, you've moved past the POC phase to an actual order for commercial traffic starting in the December quarter. How's the timeline going to ramp up? How should we think about it in terms of markets? Yeah. This is really breaking news. If there is revenue in the December quarter, it will not be really material. What we are feverishly working on is what is the ramp up, what are the access to the markets going to be. We want to make sure that we have clarity going into the one-on-ones for the Roth conference tomorrow where we are at. The impact to our financials and the growth of the business is a little bit premature to answer now, but I think we can give better perspective as we figure out the ramp up and the ability to digest the markets. We will provide that in February. Gotcha. Basically, again, live traffic, first orders, the actual slope of the adoption is a little uncertain at this point in time, but you're expected to be commercial in multiple markets at some point over the next couple of quarters is the way that we're going to go. That's very fair. Okay. I want to talk a little about the market for MDUs, but before going to kind of sizing the opportunity, in terms of where you're being deployed, two frequencies, multiple frequencies, is it just new deployments? Is it going to be retrofits? How should we think about that? I don't, my suspicion is that it's going to be retrofits because that's the economics of the MDU, but we don't definitively know what the mix is going to be. The commercial grade or the subscriber traffic will go over the 39 GHz band. Okay. To put some numbers around the market, right? The MDU market is very, very big. I think I was pulling some data recently. I think there were 21 million MDUs there in Starry markets where obviously a large tier one operator was doubling down in terms of an MDU opportunity, buying a company that was operating and using fixed wireless access for broadband deployments. I think covers 4-5 million MDUs in those core markets. How do you think about in sizing the opportunity? If I was to think the next two years, five years, ten years in terms of where broadband wireless fits in versus maybe where fiber fits in? That is a tough question, but it is a big market. I think we are trying to understand just the size of the scope over the next several years. Yeah. When I think about it, there's no argument that it's a big market, right? The reason I somewhat speculatively think that it's going to be not new apartments, but old or existing apartment buildings is because if you build a new, if you do a new build, then maybe it makes sense to just run fiber. What we don't know is what is the short, medium, and long-term mix of fiber to wireless. This is an early stage wireless deployment. You can't go out and buy a market analysis or a market report on what's going to happen with MDUs fixed versus fiber, but we're excited that we're starting the journey. We think the better we execute, the more share we can take from fiber in existing apartment buildings. There's been one large tier one that's largely been associated with some of this dialogue and discussion over the last couple of quarters. Are all the tier ones looking at broadband wireless for MDU connectivity, or is it still earlier embryonic with some of the other tier ones? I would put it as early embryonic. Gotcha. Bottom line here is, again, we're moving from POCs to commercial traffic, commercial orders, slope to be determined, but it sounds like it's going to be a big opportunity as we get into the back half of 2025, really 2026 ramping into 2027, right? That's correct. Gotcha. Okay. A couple of other things while we've got you on the call. I wanted to go through some other balance sheet issues just real quickly. NOLs. Can we talk about Starry? We did briefly, but okay, let's go back to Starry in terms of thoughts that you've got on that front. What does it mean for the opportunity? Certainly, it seems like a large tier one is doubling down in terms of their commitment for broadband wireless into MDUs. How do you interpret that? Also, how do you see the existing infrastructure for Starry? Because Starry was using older Wi-Fi-centric technology that was based on a chip that I think has now since been end-of-life. Is that a big retrofit opportunity? I got about five questions in there, but I'll just throw it out to you. Yeah. I think you understand pretty well the technology set associated with Starry and the generation that it participates in. You kind of would say kindly it's dated. I think the Starry transaction validates the market, right? I believe that it validates the market. It brings a channel. It brings a salesforce. I think that bodes well for us to invest in the space. I think the fact that we've said that we have a purchase order that will be used to satisfy subscriber needs means that we have a valid technology. You combine that with the way you characterize the Starry tech, we think we're in a good position. We were excited when we digested the Starry transaction and what it means for the growth prospects of a market that we're just entering. Just to clarify as well, right, some of the initial deployments, it sounds like, are 28, 39 GHz where you already have existing solutions that are operating in those bands. Yes. Okay. Anything else on the Starry front? No. All right. Let's move on to a quick comment on NOLs, right, in terms of the size of them, how you're thinking about them and the deployment. Yeah. So we've got a little over $450 million of NOLs still, which allows us to minimize our cash taxes that we'll pay for the foreseeable future. In the U.S., with our federal NOLs, they don't expire for or start to expire for a few years still. We've really got a nice long runway to be able to utilize the NOLs, which will help us convert our earnings to cash at a higher rate than we would be able to otherwise. Okay. Let's stay on that cash theme then, if you will. Been some questions more recently about basically the size of unbilled receivables. Take us through what's on the balance sheet right now, how do you start working that down, and how we should be thinking about then what cash flow and free cash flow is going to look like over the next couple of quarters. Sure. Yeah. We've got just about $110 million of unbilled receivables on our balance sheet as of our quarter end. The unbilled receivables is a natural part of our project-based business. The flip side of that is the unearned revenue line. We're focusing pretty aggressively internally on the unbilled receivable balance and working to unlock that line item to convert to future cash in future quarters. Really, I think what you should start to see is that the balance of unbilled receivables and the balance of unearned revenue starts to become closer to offsetting each other. That's what we're working on. That's going to help us to generate more cash that we can turn around and use for some of the growth opportunities that we've talked about today. Maybe just quickly, since we're talking about cash, you do have a buyback in place. It's pretty creative down at these levels. What's left on the buyback? How are you thinking about that? Sure. So we've got a little over $6 million remaining on our authorization. I won't comment on any specific buyback activity, but it remains a potential use of capital for us. Pete, I don't know if there's anything else you want to add. I'll move on to that, Andrew. I guess the last item, not related to sales growth and otherwise, material weakness in terms of financial controls and otherwise. What's the update on that front? Yeah. Year over year, we have improved our material weakness. This quarter, I talked to the lead audit partner with our auditor late last week. She indicated that we are continuing to improve, and we should be successful in driving some remediation. When we get into the year-end test, we need to prove that we have gotten full control. What I can—the problem with material weakness is you need to prove it over a period of time. I think we are taking the right steps. We have increased our spend on internal audit. We have brought in some outside help. We are taking it seriously. If the problem set does not move, it has not moved in a quarter, we will make a big dent in the control environment. We feel good. We need to prove it over time, and we need to get our auditor to agree with us. Just to follow up on that front, from showing it over time, does that kind of imply that we're thinking about this being a fully addressed situation by the end of the current fiscal year? That's the goal, right? If we do everything and then the audit that we're planning on doing and the auditor agrees that we've successfully accomplished that, we will be deemed remediated. If, unfortunately, we don't achieve that, I think the severity of our—the severity of the material weakness will be reduced no matter what. Okay. We have walked through a lot of aspects of the business very quickly in terms of the growth initiatives, what is going on from an MDU perspective. This is meant to be a quick update call. Is there anything else that we are missing while we have got you? We should pick your brain about it. Look, we're excited. We think our two biggest growth initiatives in cellular router and the MDU are showing positive signs. The public safety and utilities are great growth drivers. We did have the material weakness, and we think we're bouncing back from that. We feel better than we have about the business over the last 18 months. Now is the time where we feel the best. It is really a great opportunity to spend this time with you, Scott, ahead of the conference tomorrow. Thank you so much for doing this. Thanks for making the time. Thanks for letting me pick your brain here in a little fireside chat. With that, thank you very much for joining us. Andrew, pass it over to you for any final comments. No, that's it, Scott. Thank you very much. Okay. Thank you. Okay. Thank you. Thanks, everyone. Thank you all for joining today's conference call. You may now disconnect.