Good day, and welcome to the Itron Inc. Quarter Three 2022 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to the Vice President, Investor Relations, Kenneth Gianella. Please go ahead, sir. Thank you, operator. Good morning, and welcome to Itron's Third Quarter 2022 Earnings Conference Call. We issued a press release earlier today announcing our results. The press release includes replay information about today's call. A presentation to accompany our remarks on this call is also available through the webcast and on our corporate website under the investor relations tab. On the call today, we have Tom Deitrich, Itron's President and Chief Executive Officer, and Joan Hooper, Senior Vice President and Chief Financial Officer. Following our prepared remarks, we will open the call to take questions using the process the operator described. Before I turn the call over to Tom, please let me remind you of our non-GAAP financial presentation and our safe harbor statement. Our earnings release and financial presentation include non-GAAP financial information that we believe enhances the overall understanding of our current and future performance. Reconciliations of differences between GAAP and non-GAAP financial measures are available in our earnings release and on our investor relations website. We'll be making statements during this call that are forward-looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from these expectations because of factors that were presented in today's earnings release and the comments made during this conference call, and in the risk factor section of our Form 10-K and other reports and filings with the Securities and Exchange Commission. All company comments, estimates or forward-looking statements are made in a good faith attempt to provide appropriate insight to our current and future operating and financial environment. Materials discussed today, November 3rd, 2022, may materially change, and we do not undertake any duty to update any of our forward-looking statements. Now please turn to page four in the presentation, and I'll turn the call over to our CEO, Tom Deitrich. Thank you, Ken. Good morning, and thank you for joining us. You will hear third quarter details from Joan coming up shortly. Here's a brief overview of the quarter. Revenue was $421 million. Adjusted EBITDA was $24 million. Non-GAAP earnings per share was $0.23 and free cash flow was $11 million. Turning to slide five. Despite some ongoing macroeconomic crosswinds, we continue to see strong market demand for our technology. This is reflected in our third quarter bookings of $578 million and our total backlog reaching another new record of $4.2 billion. We anticipate the demand for our technology to remain robust as our customers require more insight and control over their energy and water assets. This was extremely evident through the discussions we had with our customers, partners and suppliers in our Itron Inspire conference in September. The alignment of our offerings with the needs of our customers has never been stronger, driven by the proliferation of electric vehicles, the need for distributed energy resource management, and the utility's desire to actively engage with their consumers. Some of our key bookings this quarter highlight how Itron enables the integration of renewable and distributed energy technologies onto the grid with our Optimizer distributed energy management solution. Our customers, Pepco Holdings and Tampa Electric Company, chose our Optimizer solution to allow them to analyze and control their distributed energy resources more efficiently. Next, we're proud to announce Alectra Utilities Corporation as one of our newest logos. Already a leader in utility innovation in Canada, we were selected for their next generation technology refresh, including leveraging our Gen5 Riva network and distributed intelligence-enabled endpoints to enhance the visibility and control at the edge of their distribution grid. Now turning to slide six. I would like to provide some operational updates and insights for the quarter. We see robust market demand with a pipeline that remains plentiful and a regulatory environment that continues at a healthy pace. While the market environment is positive and our backlog is resilient in a case of possible macroeconomic slowdown, we continue to experience macro supply chain constraints, slowing our ability to convert backlog into revenue. These global constraints remain focused in analog, RF, and mixed signal semiconductors that are commonly used in the automotive industry and other industrial applications. Unexpected shortages, inbound shipment delays, and nonlinear deliveries of critical components within the quarter hampered our visibility and created inefficiencies within our factories, resulting in quarterly revenue constraints above our expectations. We remain in an inflationary environment, which was partially offset by pricing actions. While the cost plateaued during the quarter, we recognize volatility may still carry forward. These headwinds have directly impacted the performance of the company, particularly in the Networked Solutions segment during recent quarters. Indirectly, the near term growth of our Outcomes segment has been deferred as well. While Outcomes growth remains at the forefront of our strategic direction, the supply constraints have driven delays of new projects, particularly those involving our distributed intelligence solutions, managed services, software and value-added applications impacting our near-term growth trajectory. As supply stabilizes and our project deployment schedules resume at pace, we are confident the Outcomes business will get back on track. While these headwinds are disappointing, we do not sit idle and continue to proactively work through this difficult macro situation, including taking on more inventory for improved backlog conversion, maintaining controls over discretionary spend, finding new ways to be more innovative and agile in the introduction of new products to the market, improving our operational footprint with our asset light strategy, and of course, maintaining close engagement with our customers to plan the delayed deployments. We do anticipate improvement in these macro-driven headwinds moving forward, allowing us to get back on track. Looking out beyond the current situation, we remain constructive on the long-term secular tailwinds, combined with our market and technology advantage that will allow us to enhance our performance. I will now hand off to Joan to cover our third quarter results in more detail and an update on our fourth quarter outlook. Thank you, Tom. Please turn to slide seven for a summary of consolidated GAAP results. Third quarter revenue of $421 million was down 14% versus last year, or 9% in constant currency. The year-over-year decline was due to the strategic exit of certain Device Solutions product lines, along with continuing semiconductor supply shortages, limiting our ability to fulfill customer demand. Q3 gross margin was 28.5%, 80 basis points higher than last year due to favorable product mix, which was partially offset by inflationary cost pressures and inefficiencies related to the component shortages. GAAP net income of approximately $4 million or $0.09 per diluted share compared with a net loss of $2 million or $0.04 per share in the prior year. Regarding non-GAAP metrics on slide eight, non-GAAP operating income was $15 million. Adjusted EBITDA was $24 million. Non-GAAP net income for the quarter was $11 million or $0.23 per diluted share. Looking at revenue by business segment on slide nine, Device Solutions revenue was $94 million, a $42 million or 27% year-over-year decline on a constant currency basis. The decrease was primarily due to the strategic exit of certain product lines, including the sale of our non-communicating mechanical C&I gas business, combined with component shortages limiting shipments. Networked Solutions revenue was $270 million, a $2 million or 1% year-over-year decline in constant currency as component shortages continued to significantly impact this segment. Revenue in the Outcomes segment was $57 million, a $1 million or 2% decrease in constant currency versus last year, with the declining prepaid business in EMEA as the primary driver. Lastly, foreign currency changes resulted in $21 million lower revenue versus the prior year. Moving to the non-GAAP year-over-year EPS bridge on slide 10, our Q3 non-GAAP EPS was $0.23 per diluted share, up $0.02 from the prior year. Net operating performance had a - $0.02 per share impact due to lower revenue and gross profit driven by the component shortages and cost inflation, partially offset by lower operating expenses. A lower tax rate and FX each had a + $0.02 per share impact versus the prior year. Turning to slides 11 through 13, I'll discuss the Q3 results by business segment compared with the prior year. Device Solutions revenue was $94 million, with gross margin of 15.7% and operating margin of 7.5%. Gross margin was up 90 basis points year-over-year, primarily due to improved product mix, partially offset by inflationary cost pressures. Operating margin decreased 40 basis points due to the fall-through on lower revenue. Networked Solutions revenue was $270 million with gross margin of 30.3%. Gross margin declined 250 basis points from the prior year due to unfavorable mix, inflationary cost pressures, and inefficiencies related to the component shortages. Operating margin of 20.2% decreased 210 basis points due to the fall-through of lower gross profit, which was partially offset by lower operating expenses. Outcomes revenue was $57 million, with gross margin of 41%, an increase of 350 basis points year-over-year. The gross margin improvement is due to the realization of managed services operational efficiencies. Outcomes operating margin was 19.9%, 30 basis points higher than last year due to the flow-through of higher gross profit, partially offset by increased R&D investment. Turning to slide 14, I'll cover liquidity and debt. Free cash flow was approximately $11 million in the third quarter, a similar level as the same period last year. Cash and equivalents at the end of the third quarter were $215 million. Gross debt remained flat at $460 million, and net debt was $245 million. Net leverage was 3.8x at the end of Q3, the same as last quarter. Now please turn to slide 15. As Tom mentioned, during the third quarter, we were hampered by unanticipated supplier decommitments, component deliveries below our expectations, and the nonlinear timing of key components arriving at our factories. While we were receiving more positive signals from suppliers, their deliveries did not meet the promised performance, resulting in lower than expected company results. Recent discussions with key suppliers leave us cautiously optimistic about supply availability improving over time. However, we anticipate this volatile supply environment will continue into the fourth quarter. As a result, we are providing a Q4 2022 revenue and earnings outlook. Our expectations for the fourth quarter of 2022 are revenue in the range of $420 million-$460 million, and non-GAAP earnings per share between $0 and $0.15. Now I'll turn the call back to Tom. Thank you, Joan. Thank you everyone for joining us today. Operator, please open the line for some questions. Thank you, sir. A reminder to the participants, if you would like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question. We will take the first question from Noah Kaye from Oppenheimer. Your line is open. Please go ahead. Good morning, and thanks for taking the questions. If I just look at the low end of the 4Q rev guide, it seems to imply basically no improvement sequentially, 3Q to 4Q in the supply chain situation. You know, I know some of the folks in the automotive industry and maybe some smart grid peers have commented to the supply chain improving as we kinda go through the back half of the year here and early into 1Q. I guess, if you could just comment on the visibility you have, you know, now, you obviously touched on some of the surprise in the quarter, but as we kind of sit here in the fourth quarter, can you talk a little bit about your visibility, maybe entering 2023? Sure. Happy to do so. The way I would think about it is, the supply chain river has been frozen for a pretty long period of time, and as that ice starts to break up, it's breaking up in big chunks, and you can end up with some jams accordingly. What we saw in the third quarter was a lot of volatility in the timing of shipments. You can see that even in the third quarter inventory as we ended up with higher inventory at the end of the quarter with components popping in at the end of the quarter. The predominant situation still remains some lumpiness in the supply. Cautiously optimistic based on what suppliers are telling us today for improved supply, but making sure you've got that last golden screw to move something out of a component level and into finished goods is what we are a bit cautious on. I would say that the situation is improving, the ice is melting, but expect it to be a little bit lumpy even during the fourth quarter. That's the outlook that we tried to convey, and it may be a visual to help you understand what it looks like. Yeah. That's helpful, Tom. I guess just to clarify that, I mean, if we see some similar dynamics in 4Q as 3Q, where you're just getting more of that inventory late in the quarter, does that maybe imply a little bit of a higher run rate, kind of even on a month-to-month basis as you exit 4Q and enter next year? Yeah. I think it's probably difficult to draw a line through it. We do expect it to continue to be volatile. While again, cautiously optimistic that it is getting better, it's still difficult to draw a lot of inferences in terms of linear improvement. Demand remains very strong. No customers are canceling or backing off on anything. They're eager for the product and, of course, we're eager to turn it, and we'll work hard to make sure we've got the capability to turn it as quickly as we get the needed components in the door. Yeah. Then as backlog does convert, you mentioned kind of costs starting to plateau a little bit here. You also referred to some pricing initiatives. Can you kinda catch us up on where you're at now in terms of price cost dynamics and, you know, what kind of pricing recoveries you're able to get, you know, both for new products and then potentially even the backlog? Sure. We, as we talked about in prior quarters, we have been working hard on the pricing side of things and saw a decent traction. That is still building for us and it improves a bit quarter-over-quarter. I would say we haven't fully caught up as the size of the backlog and some of that pricing that was in there based on design wins from quite some time ago. It probably is still another quarter or two before we've crossed that threshold. The pricing program continues to gain traction. I would mention that new agreements that we have been putting in place for several quarters now are indexed, so it does give us more protection against inflation volatility in the quarters ahead. Still haven't fully caught up and would look for that to happen over the coming few quarters. Okay. Just if I can reflect back what I'm hearing, price costs may be, you know, set to inflect at least neutral or positive, you know, in the medium term to near term. Then, you know, still some obviously margin headwinds in the backlog that was inked prior to some of these indexing agreements, but that improves maybe as we look through 2023 and into 2024. Is that a fair way to characterize it? Yeah. I think you've got the right dynamic there on the backlog itself. That is absolutely how we think about it and what we see rolling through. Remember that our backlog is probably something three, four years in time lengths. The stuff that went in there three, four years ago was not as robust against inflation volatility. The things that have gone in there in the last year or so have definitely put us on the right side of that. That part of it is still working through the system. Okay. Very helpful. Thank you. Thank you. We will take the next question from Jeff Osborne from Cowen and Co. Your line is open. Please go ahead. Yeah, good morning, Tom and Joan, Ken. A couple questions on my end. I may have missed it, but I think in prior calls you had highlighted the revenue impact from the component shortages. Is that something you quantified for the third quarter? I was just curious if it's getting better or worse. We didn't really quantify through the third quarter. I would say it was, you know, similar levels to what we experienced in the first couple of quarters. It was definitely worse than we expected when we set our guidance in the middle of the year. Got it. Then, you know, Tom, with the variability of components coming in, would you say the sort of peak to trough variability of things getting better or worse, are those peaks and troughs narrowing around the volatility? Is it getting less? I'm just trying to look for green shoots, as it relates to the product coming in. Given your inventory is a bit higher, it seems like maybe things are better, but I'd be curious for your response on that. Yeah. I think that it definitely is getting better. The green shoot that the number of components that are severely constrained by absolute number is dropping, if you will. While we haven't yet seen, you know, things breaking through on those couple of components that are severely constrained, the number of areas that is constrained is dropping and that there's the green shoot that we are optimistic about. Working hard on making sure we have visibility into to those last golden screws, to use the euphemism, and that's what creates a little bit of volatility as to when we get those things is still a bit difficult to predict, which makes us cautious in terms of how we would set the outlook for Q4. Got it. Some other auto and industrial companies are pointing more towards analog as being an issue and highlighting that, you know, things like memory and microcontrollers have gotten better. Is that still your proverbial golden screw or no? Absolutely. Yes. The places that we are constrained are analog, RFs, a little bit of mixed signal, but all kinds of semi categories, in that general vein. The digital side, the memory side is in good shape, and the mechanical side has been in pretty good shape for quite some time. Transportation freight is maybe volatile by something measured in days, but also not material. It really does come down to the analog and associated components in the semi space, which is the problem for us today. Again, cautiously optimistic that the number of those components is getting better in terms of constraints dropping off the list, but not all the way through it just yet. Got it. My last question is just sort of great to see the Pepco and TECO announcement around the Optimizer solution. Can you talk about the funnel for that in particular and when customers that already have that network canopy up and running? I assume there's no lag on when things like that could be implemented versus your narrative there on Outcomes being depressed because you're having to wait for the new networks to be built. I'm just trying to understand the dynamics of. Sure Of cross-selling to the installed base versus new customers. Yeah. The Optimizer portfolio in particular doesn't depend on a network performance underneath there. It obviously gets better with better data to operate on, but it operates quite nicely across the top. There we do see rich pipeline of opportunities, oftentimes over top of our network with our existing customers and in some cases even over competitive products. It is a strong analytics package, strong demand in the marketplace as customers are working hard to understand what's actually happening and better balance supply and demand. The initial use cases are using it for proactive outreach to EV owners to enroll in programs, but obviously, that's the tip of the iceberg and it grows from there with the management and visibility and control over a wide variety of distributed energy resources. Certainly that is a bright spot in terms of recent wins that are coming into the backlog and rolling through, but a rich pipeline of opportunities beyond that. Great to hear. That's all I have. Thank you. Thank you. The next question is from Pavel Molchanov, from Raymond James. Your line is open. Please go ahead. Thanks for the question. As some of the semiconductor suppliers are, you know, reporting literally in recent days that there seems to be a glut forming in the market, you know, presumably that is reflected in your supplier conversations. Is that in fact the case? You know, could we be on the cusp of a pretty dramatic loosening of the supply chain as, you know, we have recession kind of blinking red all around the world? Where you're at least from what I can see, where there is a glut of inventory and even some of the semi guys are writing down inventory tends to be in other portions of the marketplace. You see it in processors for PCs, for example. The PC market is very weak. Consumer is also reasonably weak, which is a different segment of the semi world than where we stand today. Scraping beneath the surface, I still think that the automotive market and there are some pockets in the industrial space like ours, meaning the part that's a little bit further away from consumers, where supply is still pretty tight. I do believe that capacity is coming online. We see good evidence of that. We do see existing capacity moving more in our direction, which gives us the cautiously optimistic views that we have. As it breaks free, I think it will begin to pick up traction and acceleration in terms of what the supply will look like. It's been difficult to predict exactly when that would happen, which is a little bit behind our outlook. Again, if you look across the tops of the trees, I think it is improving. The devil is in the details as we try to get those last bits of the bill of materials to convert backlog into revenue. It will come. It's a timing question. Okay. My follow-up is on the Outcomes segment. It's certainly more resilient than network and device, but still down year-over-year, even though, you know, most of it is software and services. What's the reason for that decline? Probably the biggest year-over-year decline component of it really has been in the prepaid sector for us, specifically in Europe. Prepaid usage has actually been pretty light given the pricing that is prevalent in the energy space in Europe. That's been the true decline, if you will, in a year-over-year sense. That's in the absolute numbers. The actual SaaS portion of it, the recurring revenue piece has been reasonably flat. What we are looking forward to, though, in terms of what the growth is, as new networks come on board and distributed intelligence, that notion of downloadable agents into the endpoint starts to ramp up as those deployments start to happen. That is the growth sector. It's been a little bit pent up in terms of the growth side that we're waiting to convert in the quarters ahead. All right. Appreciate it. Sure. Again, a reminder to all participants, if you wish to ask a question, please signal by pressing star one on your telephone keypad. We will take the next question from Chip Moore from EF Hutton. Your line is open. Please go ahead. Hi, good morning. Thanks for taking the question. I wanted to ask about 12-month backlog. You know, if we look back, is there a sense of how much lack of components has pushed out some of those deployments in more recent history and maybe how that's trended? Just really trying to get to handicap how likely it is that you can work through that, you know, $1.6 billion over the coming year. I think the way to think about it is, the full backlog is there. There's the normal shifting around in timeline. As we look at the size of the backlog that we've snowplowed or pushed ahead of us based on component constraints, we're trying to work with customers now to make sure we understand what their capacity is and the order in which they want to do various territories. Some of that is what you see rolling through as, I would say, a normal ebb and flow in terms of the 12-month backlog. We feel very good about the strength of the overall backlog. It is very resilient against any sort of macroeconomic ebbs and flows. It's really driven in terms of conversion by, number one, supply, and then planning out the timing of those deployments in terms of installation capacity with our customers. That's the profiling that you see in the 12 months. Honestly, that has been far less of a concern for us. Customers are working very closely with us in a very collaborative manner to plan out that deployment timing. Yeah, that's helpful and good to hear, Tom. Maybe just my follow-up. You know, you talked about building some more inventory here to help. Can you maybe expand on those efforts? I guess, particularly for some of the more critical components, you know, how are those stocks and what's the outlook there? The inventory that we have on board is due to component deliveries at the end of the quarter. We're actually anxious to convert that. It's all good inventory. No concerns from an excess or obsolescence risk. What we need to work through is making sure we get the last pieces of the bill of material to unlock a full conversion. We do expect certainly those constrained components will continue to be a little bit lumpy in terms of the demand, or sorry, the supply coming into our inventory. Feel good about the strength of the inventory and happy to have it on board as it allows us to unlock the conversion faster in the quarters ahead. Got it. That's helpful. All right. Thanks very much. It appears that there is no further question at this moment. I will now hand the call over back to our CEO, Mr. Tom Deitrich, for any closing remark. Please go ahead, sir. Very good. Thank you all for joining us today. Thank you, operator. We look forward to updating everyone next quarter. Thanks much. That concludes today's event. Thank you for your participation. You may now disconnect.