Good day everyone, welcome to the Infinera Corporation Q4 2022 earnings conference call. After today's prepared remarks, we will take your questions. If you have a question during this time, please press star one on your telephone keypad. It is also star one to remove yourself from the queue. At this time, I would like to hand things over to Mr. Amitabh Passi, Head of Investor Relations. Please go ahead, sir. Thank you, Lisa. Thank you. Good afternoon, everyone. Welcome to Infinera's fourth quarter of fiscal 2022 conference call. A copy of today's earnings and investor slides are available on the investor relations section of the website. This call is being recorded and will be available for replay from our website. Today's call will include projections and estimates that constitute forward-looking statements, including, but not limited to, statements related to our expectations regarding a business model and strategy, market opportunities and trends, competition, customers, capacity growth, the shift to open architecture, market adoption of coherent optical engines, our ability to ramp ICE6 and increase vertical integration, the potential for Infinera's new subsystems products to drive market expansion, increase Infinera's profitability and improve Infinera's competitiveness in the future. Expectations also regarding industry-wide supply chain challenges and the macroeconomic environment, projected year-over-year drivers of demand, revenue, gross margin, operating expenses and operating margin, future investments in our direct sales force, our ability to sell higher margin products to existing customers of line systems and Infinera's financial outlook for the first quarter and full year of 2023. These statements are subject to risks and uncertainties that could cause Infinera's results to differ materially from management's current expectations. Actual results may differ materially as a result of various risk factors, including those set forth in our annual report on Form 10-K for the year ended on December 25, 2021, as filed with the SEC on February 23, 2022, and its quarterly report on Form 10-Q for the quarter ended September 24, 2022, as filed with the SEC on November 2, 2022, as well as subsequent reports filed with or furnished to the SEC from time to time. Please be reminded that all statements are made as of today, and Infinera undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call. Today's conference call includes non-GAAP financial measures, except for revenue, balance sheet items, and cash flow from operations, which are each discussed on a GAAP basis. Pursuant to Regulation G, we have provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures in our earnings release and investor slides for this quarter, each of which is available on the investor relations section of our website. Finally, as a reminder, we'll allow for plenty of time for Q&A today, so we ask you limit yourself to one question and one follow-up, please. I'll turn the call over to our Chief Executive Officer, David Heard. Hey, thanks, Amitabh. Good afternoon, thanks for joining us today. I'll begin with a review of our results, then I'll turn the call over to Nancy to cover the details of our financial performance for the fourth quarter and for the full year. Our fourth quarter performance was remarkably strong in enabling us to beat consensus expectations on revenue and operating profit contributed to record performance on many fronts. Specifically, we reported record revenue of $486 million, up 21% on a year-over-year basis. We achieved product revenue of $399 million, also a high for the company and up 26% on a year-over-year basis. We delivered gross margins of 38.7%, up 150 basis points year-over-year, we expanded operating margins to 10.5%, up 620 basis points year-over-year. Relative to our expectations coming into the quarter, revenue and operating margin came in above the high end of our outlook range, while gross margin was within the outlook range. Demand in the quarter was healthy, with a book to bill ratio above 1. The fourth quarter also marked a great finish to 2022, a year in which we grew company revenue by 10%, consistent with our stated objective of 8%-12%, with product revenue growth even higher at 15%. We kept gross margins stable while absorbing more than $60 million of supply chain costs that adversely impacted our annual gross margins by over 400 basis points. We doubled operating margin to 4.4%, up 230 basis points year-over-year. We ramped ICE6 to 28% of product revenue for the full year, ahead of our stated objective of 20%-25%. We delivered samples of the industry's first software-defined 400G ZR+ pluggables on time with industry-leading reach, power, and performance as validated by Tier 1 customers. I'm extremely pleased with our performance in 2022, especially considering the range of macroeconomic impacts we faced, from a lingering pandemic and persistent supply chain challenges to rising inflation and a backdrop of a conflict in Europe. Despite these headwinds, we outgrew the optical systems market, gained share, improved our balance sheet, and continued to extend profitability for the third consecutive year. As I think about the year, there were two primary factors that presented us with some challenges throughout the year, one micro and one macro. On the macro front, as I mentioned earlier, our most profound challenge was navigating the difficult supply chain environment as we absorbed over $60 million of supply chain costs. Without these elevated costs, our gross margins would have been 400 basis points higher for the full year and above 40% for the full year. We expect supply costs to remain elevated for the first half of 2023. On the micro front, as we grew our business with customers into new locations and new geographies, we experienced a higher than anticipated demand for our line systems and non-vertically integrated metro products. These products do come at lower margin initially. The expanded footprint sets us up well for future margin expansion as we add transponders with our own vertical integration. Let me now turn to some of our portfolio and commercial highlights for 2022. Specifically, within the system business group, we had 3 major accomplishments in the year. First, as I mentioned earlier, we successfully ramped ICE6 to 28% of product revenue in 2022, resulting in nearly 30% revenue growth in the combined long-haul and subsea market segments. We exited the year with over 70 ICE6 customers and secured design wins with major service providers, including a U.S. Tier 1 service provider with plans to ramp revenue in 2023 and beyond. Revenue in the metro segment from the GX30 and XTM products grew by a double-digit percentage in 2022, continuing the strong momentum in this segment over the last three years. We continued to advance our suite of automation software, which makes our products easier to use and faster to onboard at open networks over competitors' line systems. We also believe software on our pluggables is a game-changing and differentiator in the industry, helping customers lower operating costs and gain higher levels of visibility and security while maximizing their agility. In the subsystems group, we also had several notable accomplishments. We turned up the first units of our 400G ZR+ software-defined pluggables in live traffic environments in North America with the Tier 1 service provider, delivering industry-leading results in reach, power, and performance. At the upcoming OFC Industry Show, we look forward to sharing additional details on the recent momentum we've had in our pluggables business. Second, we've received commercial validation of these pluggables for the first set of purchase orders of our 400G ZR+ point-to-point and our 400G XR point-to-multipoint pluggables as we exit the year. We remain on track for product availability in the first quarter of 2023. Third, we advanced the development of our 100G XR point-to-multipoint coherent pluggables based on the open multisource specifications being developed in the Open XR Forum. We believe this pluggable will be a game changer in the 5G mobile edge compute and the new access architectures. Membership in the XR forum expanded further with seven new members joining the forum in the quarter, including Lumentum and a Tier 1 North American cable operator. The forum now includes a total of 28 members, including service providers representing about 25% of the global CapEx spend in this category and several network equipment manufacturers, demonstrating our commitment to open networks in the industry. Finally, during the year, we also launched the development of our next generation 800G high-performance pluggables, which we believe will lead the industry in power, performance, and manageability. Looking ahead to 2023, we remain encouraged by the secular drivers of our business, our competitive position, our planned portfolio, and record backlog. The insatiable appetite for bandwidth coupled with the significant investments being made in fiber infrastructure are long-term positive drivers for Infinera and quite frankly, the industry. With that being said, we are mindful of an uncertain macroeconomic backdrop, which may result in some near-term variability in the timing of demand and capital spending as our customers manage their business in a recessionary climate. We see no reason to get ahead of our skis at this time, and we'll take a prudent approach to 2023. While Nancy will cover the specific details of our financial outlook, I'd like to provide some high-level color on our planning assumptions for the year. First, we expect to outgrow the optical systems market again in 2023, resulting in further market share gains. Industry analysts appear to be coalescing around a growth rate of 4%-5% for the systems market in 2023, and we believe we will grow high single digits. Similar to last year, we expect our growth to be weighted more towards the second half of the year. Second, we plan to expand our operating margins and gross margins again in 2023 as we continue to ship more vertically integrated products like ICE6 and as the supply chain costs attenuate in the back half of the year. In addition, we will exit the year with the next level of margin expansion with our own vertically integrated pluggables beginning to fire in our financials. Finally, given the strength of our refreshed portfolio and the market opportunity in front of us, we believe it's an appropriate and opportune time to increase investments in our go-to-market efforts to accelerate top-line growth and drive additional market share gains in pursuit of $1 of earnings per share as our target. Overall, we believe delivering steady and solid improvement across our financials, portfolio, customer service, and employee engagement has served us well over the last three years, despite some significant externalities. Our primary objectives remain unchanged: to grow faster than the market, drive margin expansion, and officially enter the pluggables market, a multibillion-dollar opportunity. Our 8 X 4 X 1 strategy is winning, as evidenced by our customer and portfolio traction, the demand for our products and services remains healthy. We look forward to diving deeper into our strategy, growth plans, and announcing some exciting additions to our robust portfolio of systems, high-end embedded engines, and pluggable products and technologies at our upcoming Investor Day on March 7, 2023 at OFC, the Optical Fiber Communication industry show in San Diego, California. As I close today, I would like to thank the Infinera team for delivering on a solid 2022, and their continued commitment to care to our customers and one another. I would also like to thank our partners, customers, and shareholders for their continued support. I will now hand the call over to Nancy to cover the financial details of the quarter and the outlook for the first quarter and year. Thanks, David. Good afternoon, everyone. I will begin by covering our fourth quarter and full year results, and then provide the outlook for the first quarter and full year of 2023. For your reference, on our investor relations website, we have posted slides with financial details, including our GAAP to non-GAAP reconciliation to assist with my commentary. The fourth quarter was an all-around great quarter for us. We delivered record revenue, a book-to-bill ratio greater than one, higher gross margin, double-digit operating margin, and GAAP profitability. Revenue in the quarter was $486 million, a new high for the company and up 21% on a year-over-year basis, with product revenue up 26%. This year-over-year growth was driven primarily by the strength in the Americas and with ICP customers, the continued ramp of ICE6, and ongoing momentum in our metro business. Revenue in the quarter also benefited from the early completion and acceptance of approximately $30 million of projects that were originally slated for acceptance in the first quarter of 2023. Performance in the services business improved further with revenue up 19% sequentially and 3% on a year-over-year basis as we continued to recover from the supply-related impact earlier in the year. Geographically, we derived 61% of our revenue from domestic customers, a level higher than normal due to the strength of several service providers and ICPs in the U.S. During the quarter, one ICP customer contributed to greater than 10% of our revenue. Q4 gross margin of 38.7% was within our outlook range and up 150 basis points on a year-over-year basis and 90 basis points sequentially. Relative to our expectations from about 100 days ago when we provided our outlook, gross margin came in about 200-300 basis points lower, especially when considering the high performance of revenue compared to our outlook range. Approximately 2/3 of that shortfall was due to the impact of product mix, including higher revenue from lower margin metro and line system products, while approximately 1/3 was from higher supply chain costs. Operating profit in the quarter was $51 million, up approximately 200% on a year-over-year basis, with an operating margin of 10.5% compared to 4.3% in Q4 of 2021. This margin performance in the quarter clearly highlights the operating leverage potential in our business model, which we believe will only get better as we drive a higher percentage of vertical integration in our product mix and with the benefit from the attenuation of supply chain costs in the second half. Operating expenses of $137 million in the quarter were slightly below our outlook range of $140 million-$144 million as we tightly managed spending in the quarter. The resulting diluted EPS in the quarter was $0.16 per share, up from $0.03 in the year-ago quarter. Moving on to the balance sheet and cash flow items, we ended the quarter with $189 million in cash and restricted cash, slightly down from last quarter. The primary use of cash in the quarter was working capital to fund our growth as we strategically built inventory and invested in securing our supply chain, while the use of cash by accounts receivable is typical of the fourth quarter seasonality in our business. Cash flow from operations was approximately flat in the quarter, and free cash flow was an outflow of $9 million. As I reflect on our performance for all of 2022, I am proud of the progress we made with our business model, portfolio, and customers despite operating in a very difficult macroeconomic environment, as you heard from David, for the full year of 2022. We delivered record revenue of $1.57 billion, up 10% on a year-over-year basis and within our stated range of 8%-12% growth. We ramped ICE6 to 28% of product revenue above our stated range of 20%-25%. We set a record for bookings and backlog and exited the year with remaining performance obligations of $983 million, up $220 million year-over-year. We more than doubled operating margin to 4.4%, up 230 basis points year-over-year and within our stated range of 200-300 basis points of operating margin expansion. Furthermore, we strengthened our balance sheet by refinancing a portion of our debt and therefore reducing our 2024 convertible debt to approximately $100 million, down from over $400 million previously. We also put in place a new ABL facility in the year with expanded capacity and better terms. Let me now turn to our outlook for the first quarter of 2023. We remain encouraged by the long-term drivers of our business, customer momentum and record backlog. At the same time, we are mindful of the uncertain macroeconomic environment we are operating in and the potential for some near-term impacts to customer CapEx budgets. We expect supply chain costs to carry over from 2022 into 2023, with their impact being more pronounced in the first half of the year. Taking these factors into account, we expect Q1 revenue to be in the range of $380 million ±$15 million, representing approximately 12% growth on a year-over-year basis at the midpoint of the range. Normalizing for the $30 million of higher revenue in Q4 from the early acceptance of certain customer projects, our Q1 outlook is consistent with the typical seasonality we experience in our business. We believe our revenue trajectory in 2023 will mirror the trend of the last two years, with a stronger second half compared to the first half. We expect Q1 gross margin to be in the range of 38.5%, ± 150 basis points, up 230 basis points year-over-year at the midpoint of the range. The primary driver of the year-over-year increase in gross margin is the higher percentage of vertical integration in our mix. Also embedded in the gross margin outlook is our assumption that we will continue to absorb significant supply chain impact in Q1 from elevated costs and expedite fees. We are forecasting Q1 operating expenses to be in the range of $139 million-$143 million, up sequentially as we accelerate investments in global sales and business development to take advantage of the growing market opportunity while continuing to invest in our R&D roadmap. The resulting operating margin in Q1 is expected to be approximately 1.5%, ±250 basis points, up approximately 250 basis points on a year-over-year basis. Below the operating income line, we assume $7 million for net interest expense and $4 million for taxes. Finally, we are anticipating earnings per share in the range of a loss of $0.02, ±$0.04 per share, assuming a basic share count of approximately 222 million shares and a fully diluted share count of 262 million shares. Looking further out to the full year of 2023, we remain focused on making continued progress in our financial performance as we march towards $1 in earnings per share over the next few years. Our outlook for the full year of 2023 contemplates the following. First, revenue growth of approximately 8%. Considering the approximately $30 million of additional revenue in Q4, the uncertain macroeconomic environment, and our record backlog, we believe it is prudent to set our outlook toward the lower end of our long-term 8%-12% growth rate range for now. I want to reinstate that we remain committed to our long-term growth rate of 8%-12%, higher than the growth rate of the market. Second, gross margin of 40%+ for the full year, up approximately 300 basis points year-over-year. The two key drivers of gross margin expansion in the year will be the continued ramp of ICE6 and our expectation of some relief of supply chain costs of approximately $30 million, with most of the benefit expected to flow through the second half of the year. Finally, we are planning for continued operating margin expansion, with operating margin up 125 to 200 basis points year-over-year as we accelerate investments in our go-to-market engine. As I close today, I want to reiterate my confidence in our 8 X 4 X 1 strategy, our long-term business model, and our commitment to a $1 per share in earnings over the next few years. I would also like to extend my thanks to the Infinera team, whose unwavering commitment to innovation, execution, excellence, and to one another is remarkable. I would like to thank our partners, customers, and shareholders for your continued cooperation and support. We look forward to seeing many of you at our upcoming Investor Day at the OFC Industry Show in San Diego on March seventh. Lisa, I'd now like to open the line for questions. Thank you. Just a reminder, everyone, it is star one on your telephone keypad if you would like to ask a question. We will take our first question from Alex Henderson, Needham. Great. Thank you very much. I was hoping you could talk a little bit about the mechanics around your backlog and book-to-bill number in the fourth quarter and how we should think about that backlog slash working down over time. Can you give us some sense of what your expectations are in terms of what you might have in terms of excess orders on the book as you're exiting the year? Do you still anticipate that? Just some color around that would be helpful. Thanks. Yeah, sure. The remaining performance obligations, which is our kind of proxy for backlog, was up $220 million year-over-year at $983 million, which was a record for us. Even though we did see some earlier acceptances in Q4 than we originally expected, we're looking at Q1 and the first half seeing our customers start to work through some of their own backlog, and we would expect to do the same. However, in the back half of the year, as that demand first half, second half, plays out again, we would expect that we will once again be in a position where we're building that backlog in the second half. for the total year book-to-bill- Above one at this point in time, is forecasted to be above one. You're expecting 2023 book-to-bill to be above 1. That's helpful. Thank you. You're welcome. Our next question is Mike Genovese, Rosenblatt Securities. Hey, Mike. Hey there. This is Andrew King on for Mike Genovese. Just a quick question around demand in the U.S., particularly around the Tier 1 and the other service providers. Can you just give us any idea as to if any of the demand trends around there have changed? A lot of what we've heard is that advanced ordering has slowed. Can you just talk to us about what those customer conversations sound like now versus a couple quarters ago? Yeah. That's, that's accurate. Alex's question kind of precludes that. As, you know, as we look at the first half of the year this year, I think a lot of people are coming out of the box a little bit slower in terms of their capital planning, trying to eat any of that excess inventory as we do see the actual supply chain beginning to alleviate. Those costs again are still carrying over into the first half of this year. I think you're gonna see a little bit of a slowdown in those orders in the first half, yet picked up in the back half. The CSPs, while they may hold or cut some CapEx, the priority of their CapEx is still on the rollout of fiber, in terms of spending, both fiber access and then obviously driving the speeds to bring that back into the metro and long-haul network. On the web scalers, we continue to see their cloud services business continue to grow despite people talking about layoffs in certain segments of their, of their area. And again, we now have exposure to all seven of the top ICPs. You know, again, we think people are gonna moderate and hold less, order less, sooner. I will tell you the positive element of that is we've seen better planning coming out of the CSPs and ICPs, which is why Nancy and I are able to look better at a long-term or a full year view now versus a year ago today. Great. Really good color there. Did that- And, and then. Yes That's it. Up next is George Notter, Jefferies LLC. Hey, George. Hi, guys. Thanks, George. I'm just curious about the mix of ICE6 in Q4 as a percentage of product sales. I heard the comment for the full year. I was just curious about Q4. Yeah. It approached 40%, getting in that range. Okay. As I think about your gross margin guidance for next year, I think you said 40% for the full year. You know, what kind of mix of ICE6 does that contemplate? Yeah. I said 40%+. I'm giving myself a little room there. 35 to 40 Yeah. Sorry. as it for gross margin. Oh, wait. Yeah. 40%+. Yeah. Yeah. For ICE6, we're thinking 35%-40% for the full year of product revenue. Got it. Okay. Is that, is that a lower mix than you were thinking previously? It feels like the gross margin assumptions for next year are down a little. Like, I don't know this is quite apples to apples, but I think you guys were kinda talking about, mid-40s exiting the year this year. Yeah. Now it's 40% for the year. Is the gross margin perspective a little bit lower? Is there something driving that? Is it mix? Is it something else we're missing here? No. Really good question. A, a piece of that, George, is certainly, we've talked pretty consistently about the supply chain costs. That $30 million that we talked about roughly halving from last year, that'll be very weighted in the front half of the year. We already know based on backlog and purchase commitments out there and the and the PPV we've laid out, that that is more likely to hit a large portion of that in the front half of the year. The second piece is we're continuing to lay out the mix of line systems and metro prior to the vertical integration coming in. Got it. Okay. All right. Thanks very much. I appreciate it. No, no worries. Our next question is Simon Leopold, Raymond James. Thanks for taking the question. First thing I wanted to ask you about was recently there have been a series of press releases from other optical systems players regarding newer generations. I know you're just starting to hit your stride on ICE6, so it seems early to be asking you about ICE7 or whatever you'd like to be calling it. Given the series of headlines and the timeline, what kind of assurance can you offer us in terms of your roadmap towards a next-gen platform? I've got a quick follow-up. It's a, it's a good question, and this always happens, about this time of the year, right, as we get into OFC, and always conveniently around our earnings call. Simon, it's the best I've felt. W e will lay out our roadmap for pluggables, which will be very in line with an 8 X 4 X 1 strategy in terms of our pluggable strategy that you heard us talk about, an 800 gig, a 400 gig, and a 100 gig.Remember, that's attacking about 60% of the market in terms of metro, and getting out to access. On the long-haul side, because of our block technology and us being fully vertically integrated, we are actually working on two generations of technology that we will announce at OFC, and we feel very, very strong about our competitive position. We all know that these product cycles take lots of time. ICE6 will be 800 gig will be a very long product cycle. Again, I think we feel very good we've got a ICE7 and ICE8 beyond that. Great. Just as a follow-up, I wanted to see if maybe you could unpack what you're seeing from the cable TV vertical, particularly given, Charter specifically has laid out a plan, and Comcast has been investing. In the past, those have been good, businesses for you, and just wanna see how you're thinking about the trend in cable TV over the next year or two. Thank you. I hope my sales team isn't listening to this call, 'cause I would say I don't believe they have been great segments for us. That is one of the areas we are growing and putting more investment in, because as they move to these next-generation architectures, I mean, you're hearing not only about 2 gig to the home, but now you're starting to hear about 5 gig and 10 gig to the home. You know, those architectures are going to be very, very reliant on our 8 X 4 X 1 strategy. L ook, what I'm seeing is investment, you're right. We've got the right portfolio at the right time, but we've got to make sure we've got the right go-to-market relationships and channels to be able to get there. But my- My expectations are raising for that. My expectations are raising for that segment. 'Cause you've, historically, been strong with a couple of those guys and had a, let's say, a, some share loss in the last year or two. I'm just wondering if you're making a comeback. You're referring to one major one MSO here and one in Europe. I think we feel very good about our position without revealing any particulars about the customer. Hey, hey, Simon, just as a reminder, we also mentioned a new ICE6 win with a cable operator last quarter. Just a follow-up. Great. I forgot about that, so thank you. Yeah, no worries. We'll now hear from Samik Chatterjee, JP Morgan. Hey, thanks for the question. This is Joe Cardoso on for Samik. My first question on the sequential improvement in Europe. T he revenue level there is still kind of in the sub $100 revenue run rate. Can you just provide an update on what you're seeing in that region and whether demand trends are still overall positive? More specifically, touch on the Huawei displacement opportunity, whether there has been any encouraging developments on that front and whether you're seeing any share gain or whether you're rather baking any share gains into your guides for 2023 relative to that. I have a quick follow-up. Okay. Well, good, all good questions. I think the subsea segment is reasonably lumpy. As we stated in our prepared remarks, that the long-haul and subsea segment overall was up 30% on a revenue basis year-over-year. We feel really good about our position there, not just now, but as I mentioned, over the long term with our roadmap. Did you have something? Yeah. Hey, Joe, just to clarify, was your question on Europe or subsea? The question was on Europe. On Europe. Look, I think on Europe, we did see a bit of softness in the European region. I think based on a couple of factors, one of which is FX, which we don't disclose by region, but obviously, that's the one that gets impacted the most for us. The second is, look, I think service providers there are digesting a bit as well as looking at their budgets on operating costs. As we've noticed, especially from the conflict between Russia and Ukraine, power costs have gone up. As I talk to the CEOs and CXOs in that area, their power budgets have gone up two to fourfold over the last two years. I still think that we're gonna see nice, robust growth there. The third element of that is where we're continuing to add sales and marketing resources for both Europe and the Middle East. We think that can be a that's going to continue to be a very robust and high growth area for us. Just any progress in terms of the Huawei displacement opportunity in that region, and is any of that baked into your guide for next year? Let's talk about the growth rate. Our growth rate, meaning the revenue that Nancy and I projected 100 days ago when we were contemplating next year, has not changed. The absolute number hasn't changed. We happen to have a bit of business come in in terms of acceptances and supply chain relief in fourth quarter that we assumed would be in Q1. The absolute number for 2023 has not changed, where we talked about having an 8% growth rate in 2022 and maybe 10% next year. It flipped just because of that. The Huawei opportunities, they're becoming harder and harder to decipher because they're just not being invited to new tenders. We are seeing a bigger inflow of future tenders. In fact, we have some very big ones in-house for that particular region where it is just they are not included in that. I do think that we do see opportunity there. Given everything else, I just don't think it pays for us to get ahead of our skis in terms of the growth rate for next year of contemplating anything bigger than that. I think those are some significant tailwinds for our business for the long term, for sure. Don't forget. I appreciate all. Sorry, don't forget that they're 12% roughly of, if you think of their overall market share outside of China, it's about 12%. That continues to be up for grabs for again the best solution provider over the next couple of years. Got it. Appreciate the color, guys. Thanks. Fahad Najam, Loop Capital is up next. Hey, thank you for taking my question. I apologize if you already addressed this, but if I look at your 1Q23 guide, it is a little bit more below typical seasonality. Correct me if I'm mistaken, but you had maybe 14 weeks in the fourth quarter. Is that correct? Can you just help us understand what's driving the above seasonality weakness? In Q4, we saw about $30 million of revenue that, if you look at the exceeding of the outlook range that we had originally anticipated would hit us in Q1, that we were actually able to close down in Q4. If you take that into consideration, the seasonality is about normal, about 9%. That's why you're seeing that higher number, just if you look Q4 to Q1 directly. I also wouldn't call 12% year-over-year growth in the Q1 contemplated guidance weakness. No, I think. We're splitting hairs there. For the year, as David was saying, if you look at the full year growth, and if you look at this over two years, right, the CAGR on that is over 9%, for the two years. It's a matter of just timing on when that revenue hit us. Got it. I wanted to ask you a little bit about the supply chain dynamics. One of your contract manufacturers talked about some incremental new challenges for 400G and higher speed systems, I guess, a new component shortage. Anything can you enlighten us about what you're seeing in terms of supply chain? Are you still continuing to see the same level of decommits? Is it getting more challenging? I'd say it's the same 6 to 8 suppliers and a handful of components underneath that are driving a huge portion of expedite and cost. I do believe that we're seeing relief along the way. In the first half, we're gonna see some pretty significant costs continue. In our plans, they dissipate in the back half of the year. In general, the supply chain is much healthier than it was at the beginning of last year. I'm a lot more optimistic. I appreciate the answer. Thank you. Our next question is Meta Marshall from Morgan Stanley. Great. Thanks. Maybe just a second on the product mix on the gross margins. I just wanted to get a sense of that new implementations and just kind of initial deployments that are kind of causing that product mix down, or is there a more fundamental kind of metro gross margin kind of headwind that we should be thinking of? Then just second on the go-to-market efforts and kind of the investment there. I I mean, I think you somewhat alluded to it with cable kind of being a meaningful target market for that. But, or just where should we consider kind of the bulk of those investments being made? Thanks. Sure. On the, yeah, on the metro, I mean, it's new wins, right? We've talked about this now for a couple of quarters, and we look at the growth rate we're seeing there. T he challenge is that the metro today isn't vertically integrated yet, but it will be with our own pluggables. When that happens, we see that margin expansion. We are seeing new wins, whether that be in metro or in line systems. It's not anything that I would say is new in terms of the metro, margin. It's just a matter of that we're winning more business there. Do you want to go? Yeah. I would say the other thing just for everybody to be aware of is, I think, Amitabh, this is like for the second or third year in a row, our line systems, we've under-forecasted their impact, which is, it's bad for the short term, good for the long. Well, I say it's good because those are wins. It's dilutive to the gross margins in the short term. It contemplated into Nancy's first half, second half is, in the supply chain, there were some components that were really holding up everybody's line systems. We are seeing those now come to revenue in the first half of this year, coming out of backlog, and those are dilutive. While ICE6 is going to continue to grow and our operating efficiency is going to continue to get better, what we'll fight is the layout of those line systems, which is great because it means we're winning new routes and new opportunities. that'll be again dilutive in the first half, as well as metro, you know, 40%-50% of that bill of materials is that pluggable. W e have our own pluggable now that will be available, commercially this quarter. as we go to implement that, we won't really see a significant financial benefit until, kind of as we exit the year. that's the margin dynamic. Meta, on your sales and go-to-market question, I would tell you that, without giving away strategy here, certainly the cable, area, the Middle East, Europe in those Huawei replacement opportunity markets. Then there's a lot of jurisdictions that we're not in. We're investing pretty hard in the channel because where we are, missing opportunities the number one root cause when we do a loss analysis is we weren't there. We didn't know the deal was really going down, and we didn't have the relationship there. We feel good enough about our portfolio, the market, and the position that it's time for us to lay that sales and marketing and go-to-market resource down. Did that answer your question, Meta? Yeah. No, that answered. Thank you so much. Thanks, Meta. We'll go to Dave Kang, B. Riley. Thank you. Good afternoon. First question is regarding XR, did I hear you correctly that you guys got purchase orders? How should we think about revenue projection for XR for the next couple of years? I think what we've said in our, in our prior remarks as we did our last Analyst Day is, we'll start to see those external sales as we see today. I get very excited when I see other network equipment manufacturers onboarding that 'cause the reason we've tried, we've stayed in our 8 X 4 X 1 strategy as an optical player and not making switching and routing products is we don't wanna compete with those that we're supplying. I think externally you'll start to see that ramp this year. It's not gonna be a huge number this year, but you will see, we will see design wins that will relate to more marketable revenue in 2024. We will also begin to, again, as we exit the year, we're qualifying in our own metro platform but by the time that rolls through the revenue recognition cycle and the income statement, that'll really be a big story in 2024 in terms of continuing this margin accretion that we've been on. I would say at our Analyst Day, we plan to kind of walk through how that transpires over the next several years and show the impact that it can have on our overall business model. I think it, in the past, you talked about XR SAM to be about $1 billion-$2 billion. Maybe you'll go over that, during the Analyst Day. What do you think the, you know, your market share, will be? That's not something, let's talk more at the Analyst Day. I will tell you, if you're a pluggable player in the industry, having the vertical integration, the fab capabilities, the advanced packaging capabilities, all the assets we have, you're not a small player. There are no niche players in that market, so it's kind of an oligopoly, and so the numbers of market share tend to fall within that structure. We'll talk more about that in the Analyst Day. It's a good question though, Dave. Got it. Thank you. A reminder, it is star one if you have a question. We'll go to Jim Suva, Citi. Thank you. David, Nancy, I think both of you mentioned dollar of earnings per share. I just wanna calibrate and make sure you weren't referencing for 2023, I'm quite certain of that, but do you have a timeframe of when that is? No, I was not referencing 2023. Rather you could think about that in the 2025, 2026 timeframe, and we'll walk through what has to happen during Analyst Day to whether it falls on the 25 line or the 26 line. Great. That's exciting. When you mentioned in Q4 you had some early customer acceptances, does that mean that in 2023, that these are potential customers that are going to be doing future rollouts and purchases faster than expected? Is that how we should kinda think about those early customer acceptances that you referenced? I think some of them, yes. I mean, some of them it was a matter of whether it fell in December or January and when we thought it was gonna hit. Certainly they were new wins. We're pleased, right, that we have them as customers and would expect them to grow. The second is on the line systems, where we had line systems coming in in December. That allows us to start that process and that timeframe in order to fill those line systems earlier, which is good. Okay. Then my final question, probably for Nancy as CFO, how should we be thinking about kinda cash flow for 2023 seasonality or variability as we progress through the year for cash flow? Yeah. I certainly, our plan would have us generating cash from operations in the year and modest free cash flow. Again, we are gonna be absorbing about $30 million in terms of additional supply chain costs in my contemplation there. Our, you know, I, we saw in Q4, the additional supply chain, the ability to bring on additional inventory, which we took advantage of and wanna get that turned out to our clients. I'm pleased that we were able to do that. One of the things I did not mention is we don't have anything drawn on our ABL at this time either, that still remains available to us if we need it to for working capital. For 2023, for the year, generating free cash flow, generating cash flow from operations and modest free cash flow. Great. Thank you, David and Nancy, for the details. Thanks, Jim. Everyone, at this time there are no further questions. I'll hand the call back to management for any additional or closing remarks. No, I appreciate it, and all very good questions. Look, overall, 2022 was a very solid year. W e grew the top line 10%, ahead of the market, gained share, and more than doubled our operating profit in the year. That's the third consecutive year of improving our financial progress. We think that steady, consistent approach is gonna be great for executing our 8 X 4 X 1 strategy. That strategy is working and it's winning. We delivered this performance while we really addressed some really tough macros. I mean, absorbing over $60 million of supply chain costs and continuing to improve the margin level at the rate we did while we executed our product portfolio to the timing, to our expectations and the performance ahead of our expectations in terms of the products. Want to remind you all that having the right elements of vertical integration has never been more important. As people talk about increasing the speeds of baud rates and wave sizes having our own components baked into photonic integrated circuits, our own U.S.-based fab, our own U.S.-based advanced packaging allows us to have our own low, low noise, high output lasers, our own modulators, photodetectors, advanced RF packaging to facilitate higher baud rates. That's why we're so comfortable that these block technologies are allowing us to move faster through our development cycle at greater R&D efficiency for both a subsystems business that we intend to be a leader in and a systems business that we intend to continue to gain share. This year, I think what we're seeing is people going through their budgets, I believe we're gonna see again that dynamic of beating in the backlogs for the first half and gaining overall book to bill in the second half of the year and for the year. Demand continues to look strong. We will give you lots more guidance as we lay this out at OFC. We look forward to seeing you there. Again, look forward to your continued engagement. Thank you all for your continued support. Have a wonderful day or evening. Thanks, everyone. Once again, everyone, that does conclude today's conference. Thank you all for your participation. You may now.