Good day, ladies and gentlemen, and thank you for standing by. Welcome to the DZS Q2 2024 Financial Results conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. At this time, I would like to turn the conference over to Mr. Geoff Burke, SVP, Marketing and Investor Relations. Sir, please begin. Thank you, Demi, and welcome to the DZS conference call to discuss Q2 2024 financial results. Joining me today are DZS President and CEO, Charlie Vogt, and CFO, Misty Kawecki. During our call, we will provide projections and other forward-looking statements based on our current expectations regarding future events or the future financial performance of the company. Such statements are subject to risks and uncertainties, and actual events or results may differ materially. Please refer to documents that the company files with the SEC, including the most recent 10-Q and 10-K reports, and the forward-looking statement section of our Tuesday, September third, press release. These documents identify important risk factors which can cause actual results to differ materially from those contained in our projections or forward-looking statements. Please note that unless otherwise indicated, the financial metrics we provide to you in this call will include those determined on a non-GAAP basis. These metrics, together with corresponding GAAP numbers and a reconciliation to GAAP, were contained in the press release issued on Tuesday, September third, which we have posted to our website and filed with the SEC on Form 8-K. We will also discuss historical, financial, and other statistical information regarding our business and operation, and some of this information is included in the press release. I will now turn the call over to Charlie. Thank you, Geoff. Good morning, and thank you for joining us today. I'm pleased to share that we have now filed our restated and delayed periodic reports, including NetComm's two-year audited financials and the DZS and NetComm pro forma financial analysis as of June thirtieth, 2024. This means that we are now current with our required SEC periodic report filings. We understand that many customers, suppliers, and shareholders are disappointed with how long the restatement process has taken. The restatement process required all parties involved to be thorough, definitive, and complete. As a multinational global business with tens of thousands of orders, shipments, and revenue transactions, our finance and external independent audit firm took the necessary steps and time required to ensure this process was thorough and complete. To provide a more detailed timeline, our finance leadership team self-discovered a revenue recognition matter in June of 2023, associated with two customers for which we recorded revenue in Q1 of 2023. The main portion of the audit committee's independent investigation in connection with the restatement was substantially complete in early 2024. We then began a thorough independent auditor RFP process and ultimately selected BDO as our new independent auditor in March of 2024. Over the next five months, our finance team, audit committee, and independent audit partner worked diligently and collaboratively to complete 2022, 2023, and the first half of 2024's quarterly and annual reports, including the divestiture of Asia and our recently acquired NetComm. As a result of the various financial work streams and a compressed timeline, we were unable to file the required filings by the Nasdaq required date. Appreciating that our number one priority from the beginning of this process was to ensure that we followed a thorough and appropriate process. With our SEC periodic reports complete and current, and while it's our goal to relist on the Nasdaq, our number one priority remains delivering for customers, gaining the synergies from our newly acquired NetComm business, and converting $75 million of paid inventory to cash. Throughout this process, our customers, systems integrators, suppliers, and manufacturing partners have been incredibly supportive. We value our partner alignment and support, and together, we are focused on creating incremental momentum with the innovation that spans our networking and connectivity solutions. Following Misty's remarks regarding our financials, I will share more specifics about the investments and advancements we have made over the past eighteen months, including the divestiture of our former Asia business and, most recently, our acquisition of NetComm. I will also provide our insights on the broader market and our outlook for the second half of 2024. Misty? Thank you, Charlie. We are pleased that we are now current with our SEC periodic reports and can once again resume sharing our earnings and financial details. I would like to first review how the restatement unfolded and then discuss our recent financial performance. On June first, 2023, we issued a press release indicating we would have to restate prior period financial results for the first quarter of 2023. Shortly thereafter, our audit committee engaged with our external audit and legal teams to undergo a very thorough investigation. While the investigation was still going, by November of 2023, we determined that we would also restate our financial statements for 2022 and for each quarter therein. We received a readout of investigation findings in early 2024. We hired BDO, our independent auditor, in March of 2024. As you can see from our filings, and to summarize the impact of the restatement on our revenue, on an annualized net basis, $17 million of revenue previously recorded in 2022 was deferred and not recognized in 2022. In 2023, on an annualized net basis, $200K of previously deferred revenue was recognized, which is the result of $3 million in net recognized revenue for the Americas and EMEA, and a net $2.7 million in net deferred revenue for Asia. A net total of $1.8 million of previously deferred revenue was recognized in Q1 2024, and the remaining $15 million of deferred revenue, which represents the amount of Asia revenue still deferred at the time of the divestiture of the Asia business, will not be recognized by the company. As we reflect on our revised financial results, please keep in mind that the divestiture of the Asia business in April 2024 was approximately 50% of the consolidated business and reflected in our results from continuing operations beginning in Q1 2024. Further, in 2023, industry revenue associated with shipments of access equipment declined over 25% relative to 2022 due to a telecom service provider spending pause, resulting from excess inventory at customer locations. This inventory buildup was caused by a surge in lead times to 52 weeks or longer during the pandemic that resulted in panic buying, delayed deployment and trial timelines, and the higher cost of capital due to the rapid increase of interest rates in 2022 and 2023. Accordingly, we experienced an increase in inventory in the second half of 2023. As a result, gross margins for 2023 included a charge for excess inventory of $25 million. Further, in response to the reduction in industry-wide top-line declines, the company reduced operating expenses by approximately 29% during the second half of 2023. Turning to our first half 2024 performance. Our first half results from continuing operations reflect a reduction in top line, but an improvement in profitability as a result of lower revenue conversion, including backlog and bookings and government delays, offset by improved margins and reduced operating expenses. Revenue in the first half of 2024 was $58.7 million, including only one month of NetComm, compared to $74.9 million in the first half of 2023, a decline of 21% year- over- year. Software as a percentage of revenue from continuing operations was 17% in the first half of 2024, and 14% in the same period of prior year. Adjusted gross margin from continuing operations in the first half of 2024 were 39.8%, compared to 38.1% in the first half of 2023. Adjusted operating expenses declined by $14 million, down 29% in the first half of 2024, compared to first half 2023, as a result of cost reduction efforts in the second half of 2023. Adjusted EBITDA in the first half was a loss of $11 million, compared to a loss of $20 million in the first half of 2023, an improvement of $9 million. During Q2, we divested the Asia business, recording a $2.8 million loss on sale, net of transaction fees. Additionally, in June 2024, we acquired NetComm for $8.2 million of total consideration without any accounts receivable or accounts payable, recording an estimated bargain purchase gain of $41.5 million, resulting in positive GAAP EPS of $0.61 per share for the quarter. Turning to the balance sheet. As of June 30, 2024, we had approximately $128 million of working capital on the balance sheet between cash, accounts receivable, and inventory, including acquired NetComm inventory, offset with approximately $49 million of accounts payable. As previously mentioned, at the end of 2023, we undertook a thorough evaluation of our inventory, recording excess reserves of approximately $25 million, providing confidence in the value of the remaining inventory, resulting in a stronger balance sheet. Second half 2024 and full year 2025 focus will be achieving NetComm synergies, drawing down inventory levels, and converting this inventory to cash, converting active trials, profitability, and strengthening the balance sheet. Further, now that we are current on our SEC periodic reports, we have more options to address working capital requirements to align with and fuel our growth as we enter 2025. We are working closely with existing as well as other potential financial sponsors to optimize our current three-year term note of $30 million and upsize our working capital aligned with our anticipated growth during the second half of 2024 and into 2025. We believe that the addition of NetComm was very strategic to the business from both a product and business perspective. The acquisition brought DZS not only complementary and leading-edge new technology in the fixed wireless access, fiber extension, and home broadband connectivity domains, but it also brought a number of marquee Tier 1 customers. Financially, we believe the acquisition will be accretive, adding significant scale and new revenues to our connectivity products. In the second half of 2024, we expect improved performance in the form of higher orders and revenue compared with the first half, due to the inclusion of NetComm and the timing of fiber to the home and enterprise projects that are expected to accelerate and convert during the second half of the year. With the addition of NetComm's leading-edge products and the divestiture of our lower-margin Asia business, our gross margins are expected to improve compared to 2023, but slightly lower than first half performance from continuing operations. With our spending optimized over the 12 months, the divestiture of our Asia business, and with our acquisition of NetComm, we expect operating expenses to be in the $15 million-$17 million range, exiting 2024. Our interest payments on our term debt annualized is approximately $4 million, and we expect a 21% non-GAAP tax rate going forward. As Charlie mentioned, it is our goal to be relisted on the Nasdaq, especially as we expect the market and our business to stabilize during the second half of 2024 and into 2025. Our number one priority is delivering for customers, becoming current with our supplier ecosystem, and generating positive cash flow during the second half of 2024. With that, I'll hand the call back to Charlie. Thanks, Misty. The period from 2020 through the first half of 2023 represented an industry-wide acceleration of high-speed broadband access, fueled by the COVID pandemic. At the same time, broader silicon chips and component supplier market was challenged in responding and delivering to meet these unprecedented demands. The work and learn from home phenomena, fueled by COVID, prompted service providers to accelerate their deployment plans of high-speed fiber, fixed wireless, and 5G mobile broadband services, responding to consumer and business requirements. The inability for critical and essential employees within the supplier ecosystem disrupted the timeliness and availability of silicon chips and system components, resulting in unprecedented fifty-two-week lead times, and created an increase of cost of goods sold, as well as freight and logistics costs. In the early days of COVID, DZS embarked on a company-wide transformation. We began with a vision and mission to differentiate our broadband access portfolio from a design, architecture, performance, and scale perspective, aligned with service providers, emerging technology, and business models. During this period, we also advanced our IT systems, outsourced two manufacturing facilities, acquired three companies, divested our Asia business, and most recently, acquired NetComm. Over the past few years, we have invested approximately $130 million in advancing and differentiating our broadband access, optical connectivity, and Cloud Software portfolios. From 2020- 2022, and prior to divesting our Asia business, top-line revenue grew from $300 million- $358 million, and backlog grew from $80 million to approximately $300 million. As we entered 2023 with optimism based on a robust backlog, government stimulus programs that were forecasted to begin, and with numerous technology trials and RFPs that were underway. During the second half of 2023 and into the first half of 2024, our industry and DZS experienced a pause in capital spending due to an over-rotation of inventory consumption that occurred in 2022 and the first half of 2023, and combined with slower-than-expected disbursements of pandemic-inspired government stimulus funds. Pause and timeline shifted by service providers led to delays in backlog consumption and pushouts with anticipated new orders and shipments. The contributing near-term results have shifted more of our working capital to invested inventory, which remains aligned with backlog and anticipated new orders. As of the end of June, we had approximately $75 million of paid-for finished goods and raw materials on the balance sheet. We expect Q3 and the second half of 2024 to experience double-digit growth in orders and revenue compared to Q1 and the first half of 2024, as service providers continue to deplete excess inventory and with the inclusion of our recently acquired connectivity portfolio. As we look forward to 2025, we anticipate a recovery to a more normal pre-COVID investment cycle. The broadband connectivity portfolio we acquired from NetComm includes category-defining fixed wireless access, fiber extension, home broadband, and IoT solutions. We believe the secular demand drivers for high-speed fiber and fixed wireless broadband services remain intact and ultimately will benefit from government stimulus programs, including the United States Build America, Buy America stimulus program that we expect to begin in 2025. DZS has been manufacturing broadband solutions in the United States for more than 20 years. As of today, DZS has certified with the NTIA that we believe to be the industry's broadest range of Build America, Buy America-ready OLT systems and fiber-terminating ONTs with integrated Wi-Fi routing capabilities. As service providers continue to invest in their fiber and fixed wireless networks to deliver multi-gigabit services, they are being architecturally thoughtful with their network design, ensuring that the technology investments they're making today will allow them to position their networks to be future-ready. As technology shifts to the network edge, DZS is capitalizing on new opportunities fueled by the demands of emerging applications, to which we are responding with embedded software-defined elements, including AI and machine learning. With consumers and businesses fueling fixed and mobile broadband with intelligence and security at the network edge, DZS is better positioned than ever before to capitalize on opportunities created by this transformation due to the investments we have embarked on over the past several years. Our acquisition of Optelian added 100- and 400-gigabit optical transport expertise, complementing our broadband access portfolio. In Q4 of 2023, we began shipping our flagship Saber 4400 optical edge hardened ROADM platform, and today have a growing number of customers that are leveraging Saber's modular form factor and economic cost structure. During the first half of 2024, we also began shipping our Velocity V6 OLT systems, which delivers 800 Gb of non-blocking capacity per slot in a compact 6-slot chassis design, making it the industry's most advanced OLT and architecturally designed to support 50 Gb and beyond. Our network assurance and Wi-Fi software management solutions support more than 100 unique Wi-Fi devices, spanning third-party connectivity vendors, and support more than 50 million subscribers. We expect that our former Asia business, divested in April, will lessen the competitive exposure to markets that continue to deploy high-security risk equipment vendors and will allow us to focus our go-to-market strategy on markets that are adopting open and standards-based platforms. We also expect the divestiture of Asia will improve our gross margins and reduce our exposure to foreign exchange volatility. Most recently, in June of this year, we acquired NetComm, underscoring our commitment to innovation at the network edge and amplifying a broader connectivity portfolio, which now includes fiber extension, fixed wireless, and IoT solutions. The acquisition of NetComm accelerates our Wi-Fi 7 time to market and uniquely extends the reach of high-speed broadband access with differentiated fiber extension and fixed wireless access solutions. These newly acquired connectivity solutions have been standardized and deployed by some of the world's largest service providers, including USc ellular, Brightspeed, and Lumen. The NetComm acquisition also expands our customer footprint across North America and Europe and creates a new customer footprint within Australia and New Zealand. Our technology investments over the past few years have delivered on the vision, strategy, and playbook we outlined in early 2021 and aligns with what service providers around the world require to differentiate their fiber and fixed wireless offerings. As we look ahead to the immediate and midterm future, our sales pipeline and technology trials are expected to result in growth during the second half of 2024 and into 2025, especially as service providers navigate through excess inventory resulting from elongated lead times caused by the COVID-impacted supply chain challenges. With approximately $150 million of backlog, $75 million of paid inventory as of June, and the first half 2024 operating expenses lower by $14 million compared to the first half of 2023, we anticipate our balance sheet to improve over the next 6-12 months. In conclusion, we anticipate an improved demand environment during the second half of 2024 and into 2025. We expect to deliver incremental sales synergies in conjunction with our acquisition of NetComm, and we remain focused on converting active technology trials into new design wins. I want to thank our employees and board of directors for their commitment, resilience, and perseverance over the past year. Furthermore, I want to thank our committed customers who have seen past the external noise related to our restatement matters and self-serving competitor commentary. Finally, I want to thank our technology, manufacturing, and broader supplier ecosystem who remain committed to our next chapter together. Following this call, we expect to post an updated investor presentation. We plan to share our Q3 2024 business and financial results in early November. Until then, thank you for your time today. With that, I'll now turn the call back over to the operator to facilitate questions. Thank you. Thank you. We will now begin the question-and-answer session. If you have dialed in and would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Again, press star one to join the queue. Your first question comes from the line of Ryan Koontz with Needham & Company. Your line is open. Hi, great. Thanks for the question, and great to hear from you guys. Charlie, you know, Europe is showing some resilience here in first half 2024, nice uptick in 2Q, while the Americas business is down just maybe a little bit more than the broader market. Maybe can you shed some light on your thoughts about your fiber, your core fiber, opportunities across those two markets? You know, where you're most excited about. I know you had some Tier 1 traction going in Europe, last we heard from you. Maybe give us an update on some of the, some of the fiber opportunities as you, as you see it, that could impact, say, the next few quarters. Thanks. Sure, sure. It was good, good to hear from you, Ryan. You know, first, I think the most important thing for everybody to appreciate is just, you know, the dynamics that happened in 2023. As I sort of highlighted in my scripted remarks, you know, the first half of 2023, we had a lot of backlog that we were aligned to, and we obviously went into 2023 with an outlook that a lot of the pacing of a lot of the trials that we were involved with would convert during the second half. That didn't happen, I think, frankly, for a lot of reasons. I think one was just where a lot of service providers were in the management of the inventory that they had acquired over the previous, let's call it, 12 months. And so there was, in our view, a different sort of pacing in the second half of 2023 and maybe into the first half of this year, with the general, you know, sort of grouping of at least our customers. As it relates to a lot of the new trials that we've invested a lot of time and energy into over the last eighteen months, we're still very optimistic about the outcome of those. I would say that a lot of those in 2023 got pushed out just because they were prioritizing their core business and just deploying as much inventory as they had before they brought on a new technology supplier like us. We certainly feel like getting through this restatement, which was obviously very unfortunate and disappointing for all of us, has created, I guess, a bit more resilience in everything that we're doing. But at the same time, we feel like a lot of the larger scale Tier 1 or Tier 2 trials that we talked about back in late 2022 and early 2023 are still very much intact, and we believe that a lot of those will convert, you know, in the second half of this year, giving us an opportunity to deploy and ship in 2025. You know, as it relates to the comment that you had around just the mix, you know, I would say that it was our goal in the second half of 2023, and the first half of this year, to ship as much as we could to those who, you know, had the ability to take products and that still had a very active deployment schedule that wasn't dependent on and reliant on the inventory that they already had. So I think a lot of the sort of regional mix and the product mix that you saw, I think from us, at least in the second half of last year and the first half of this year, had a lot to do with that. I think as we go forward in the second half of this year, things seem to be a bit more clear. I think most of our customers have worked through the bulk of the excess inventory that they took on, you know, in the previous 12 months. So we feel like the second half of this year will begin to look a bit more traditional, and certainly as we go into next year, we think that next year becomes a much more normalized year for the space and for us. Got it. That's helpful, Charlie. And on the middle mile opportunity with Saber, you know, how are you feeling about that? The product's been shipping for a little while now. Have you kind of narrowed in your key niche that you're looking to enter that market? Because I'm sure the product's not featured to do everything for everybody. So, do you have a good feel for where the opportunities are and what the competitive landscape is there for the new Saber 4400? Yeah, no, I mean, a great question, and I appreciate the question. You know, look, we launched Saber to really wedge our way between the gap that we saw in last mile and where the high-density DWDM optical transport, metro and long-haul market was. And so, you know, what we were beginning to see over the, let's call it two years, as more and more XGS-PON was being deployed and as more service providers and technology companies were talking about 25 and 50 gig, you know, it became very evident to us that there was gonna be a bottleneck issue at the Access Edge, and that, you know, it was a great opportunity for us, especially with the acquisition of Optelian, to turn a lot of the resources to building a next gen access optical transport product that would sit collocated right at the OLT and more economically aggregate last mile fiber and hand that off to, you know, the Ciena and the Infinera and the Nokia of the world that are driving higher DWDM bandwidth. So, we think that that's a big market opportunity for us. I would tell you, we were probably six months late in getting that product to market. And with most new products, you know, you're looking for two or three new customers to really help validate the product, to work out some of the early kinks and issues that don't get determined until, you know, you're first deploying. And I say we're sort of past that window right now, and we're now into that reference cycle where we now have a couple of customers that are very happy, and that we believe will become the references that we need for that. But as it relates to the actual application and the design, we think that the market opportunity for Saber is very encouraging for us. Great, Charlie. That's all I got for now. Thank you. Thank you. Next question comes from the line of Tim Savageaux with Northland Capital Markets. Your line is open. Hey, good morning. Wanted to drill down a bit on the second half guidance. Clearly, you're gonna include a full quarter of NetComm here in Q3. I don't know if that gets you an incremental $10 million or so. And I guess the question is, in terms of the growth commentary, you know, to what extent do you expect the kind of organic DZS business to grow in the second half? And, you know, kind of what order of magnitude. And, you know, if you add all that up, along with your OpEx commentary, and again, I imagine gross margins might come down a bit with a full quarter of NetComm in Q3. But it seems like you could have a reasonable shot at breakeven exiting the year. I'd be interested in your comments on that. Thanks. Oh, it's good, good to hear your voice, Tim. I think you got it right. You know, obviously, we're purposely being thoughtful about, you know, what we're going to guide to, especially coming out of a pretty challenging, let's call it, 12 months. And so our thought process right now is that we would soft guide in the second half of this year and hopefully get to a more formalized guidance profiling starting in 2025. I think, you know, if you're us and having endured what we just did, you know, there's not a lot of upside for us right now to be overly ambitious with investors and analysts. And so, you know, I mean, look, I mean, you know, you're absolutely right. I mean, you know, we've now provided pro forma financials for anyone to look at as it relates to the business that we acquired. I mean, you know, acquiring NetComm, the way we were able to acquire it for the price that we were able to pay was extremely favorable for us. And we certainly see a lot of favorability from the customers that we acquired. There seems to be a lot of continuity. There's certainly a lot of sales synergies. We're, you know, the former Casa team wasn't very focused on a lot of the products, especially in North America and EMEA. They had a very, I'd say, robust business in Australia and New Zealand. But as it relates to accelerating things in North America and Europe, they just didn't have the sales focus and the customers to really take advantage of the technology, which, you know, that was a big part of our investment thesis, was looking at our customers, looking at their technology, and how we could gain the sales synergies just within our own customer base, not to mention their run rate business. So I think you're looking at it right. There's no reason why we can't exit 2024 as a break-even business and really position ourselves to be better positioned in 2025. Okay, great. And then I wanted to ask a question about the kind of U.S. rural fiber market. You know, what we've seen this year is, you know, kind of the, at least initial approvals piling up in the BEAD process. I wonder if you can give us an update on the opportunities you're seeing develop there, understanding that, you know, probably don't get any big flow of funding, until next year. But I'd be curious as to the kind of activity pipeline that you're seeing, across that part of your business. Yeah, I would say that, and it's probably the same with our peers, what we're seeing is, for the first time, and maybe that's a really good indication that progress is being made, you know, with the local state broadband offices and the allocation of funds, is just the application formality and process and helping, you know, at least our core customers who are planning on using our products to apply for and ensure that we qualify. And I think that was one of the reasons why we wanted to go out of our way in my script to highlight the fact that we have most recently certified with the NTIA our products that would align with our customers that would qualify for BEAD funds, which is a big deal. I mean, that is one thing, Tim, I'd say that is really now starting to be scrutinized is, you know, what vendors are certain service providers planning on using, and are they truly certified? And there is a process to qualify and certify, and we've done that with our OLTs and ONTs. And so, you know, that, I think, is a leading indicator, at least for us, with our customers, that, you know, the process is working. I think you're right. I think, you know, we don't expect to see meaningful dollars really show up on our doorstep until probably the second half of next year. I mean, I think the way the funds are gonna ultimately work is on the precursor side before electronics are being purchased and installed. As you know, there's a lot of phases in the construction process and in the deployment process. But I do think that we're seeing progress, and I do think funds are gonna roll into our segment with us and our peers. I think by the second half of next year, for sure. Great. Thanks very much. I'll pass on. Thanks, Tim. Thank you.