Greetings, and welcome to Kornit Digital's Q1 2023 earnings conference call. As a reminder, this call is being recorded. I would now like to turn the conference over to our host, Mr. Andrew G. Backman, Global Head of Investor Relations for Kornit Digital. Mr. Backman, you may begin. Thank you, operator. Good day to everyone, and welcome to Kornit Digital's Q1 2023 earnings conference call. With me today are Ronen Samuel, Kornit's Chief Executive Officer, Lauri Hanover, Kornit's Chief Financial Officer, and Amir Shaked-Mandel, EVP Corporate Development. For today's call, Ronen will provide comments on the Q1 of 2023. Lauri will then review the Q1 numbers and provide our Q2 outlook before we open it up for Q&A. Before we begin, I would like to remind you that forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. security laws will be made on this call. These forward-looking statements include, but are not limited to, the statements relating to the company's plans, strategies, projected results of operations, or financial conditions, and all statements that address the developments that the company expects will occur in the future. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause results to differ materially from those implied by the forward-looking statements. I encourage you to review the company's filings with the Securities and Exchange Commission, including the company's annual report on Form 20-F filed with the SEC on March 30th, 2023, which identifies specific risk factors that could cause actual results to differ materially. Any forward-looking statements are made currently, and the company undertakes no obligation to publicly update any forward-looking statement except as required by law. Additionally, the company will be making reference to certain non-GAAP financial measures on this call. The reconciliation of these non-GAAP measures to the most directly comparable GAAP measures can be found in our earnings press release, which was published today, which is also posted on the company's investor relations website. At this time, I would like to turn the call over to Ronen. Ronen? Thanks, Andy, thanks everyone for joining us for today's call. As we reported earlier today, our Q1 revenues were $47.8 million, in line with the guidance provided in February, which, as a reminder, included the impact from the fair value of issued warrants. Promising indicators emerged during the Q1 in certain parts of our business, despite the persistent macro pressures in the overall operating environment. System sales supporting our customized design customers, which historically represented about 90% of our business, remained challenging during the quarter. However, we see some promising capacity utilization indicator emerge, including double-digit year-over-year impression growth from several of our larger strategic accounts. This included our global strategic account, who is bringing additional systems online to handle their current and expected volume growth this year. Remember, these systems were shipped last year but experienced installation delays due to site completions. Far, impression momentum continued in the Q2, with several of our customers being a bit more optimistic regarding overall growth at the start of 2023. Customers upgrading to our MAX technology drove a strong quarter for service revenues. During the Q1, we received orders from several strategic customers for approximately 60 system upgrades from Atlas to Atlas MAX. Customer choosing to upgrade to our MAX technology are making a clear endorsement of its quality, color vibrancy, durability, and enhanced productivity. We continue to believe MAX is the new industry standard and expect other large customers to upgrade their systems throughout the remaining of 2023 and in 2024. Overall, while capacity utilization in the customized design market is still not optimal, we believe we have just scratched the surface of the immense opportunities unfolding within large social, digital, entertainment, and content online platform seeking to embrace and monetize the power of on-demand digital production by making it easily accessible from within their platforms to the massive global communities of users, creators, artists, merchants, and fans. As such, while not at the same elevated levels experienced during the pandemic, we do expect growth to resume in the customized design category as overall macro conditions stabilize. Over the past several quarters, we have been making steady progress on our strategy of targeting brands and retailers and their global fulfillment partners looking to restructure supply chains in order to address new products paid to market, margin expansion, excess inventory liability, and regulatory enforcement of sustainable textile production. Our MAX technology and our innovative products are the cornerstone of this strategy. We stock retail quality, better cost efficiencies, and new products capabilities. For example. Our Atlas MAX POLY opens up massive new global fashion, athleisure, and entertainment apparel markets for Kornit customers, enabling them to offer retail quality sportswear and fan wear. In fact, we had a strong Q1 for Atlas MAX POLY, mostly with some of our largest strategic customers in North America, EMEA, and in Asia Pacific. I'm also pleased to see the progress we have made in direct-to-fabric, which is now starting to contribute more meaningfully to our business. We are penetrating new markets and are building a very good funnel in key textile regions of Latin America, Europe, and Asia Pacific. During the Q1, we added several new customers, including one of the prominent printing houses in Italy and in Germany with an international producer of high-tech functional textiles for a variety of industry, including for some of the world's highest-end brands. We also successfully closed several Presto to Presto MAX upgrades. With our innovative single-step solution, Kornit is the market leader in direct-to-fabric. We continue to strengthen our leading position with Presto MAX and with new innovation, including a revolutionary new ink we will showcase at the upcoming ITMA trade show in Milan that we believe will accelerate the penetration into the mainstream fashion industry. It's an exciting time at Kornit as we gear up for ITMA, where we intend to demonstrate how digital production goes mainstream and showcase sustainable on-demand manufacturing at scale. We will showcase Kornit industry-leading technology portfolio, which offers the apparel and textile industry a complete digital transformation solution to on-demand production. At ITMA, we will officially unveil Apollo, our breakthrough platform suitable for longer run production cycles than what Kornit solution have been addressing to date. This brings digital production into the mainstream and will be a real differentiator. Based on initial feedback from our customers, we are more confident than ever that the Apollo will be a game changer in terms of productivity, automation, quality consistency, and total cost of ownership. In addition to the Apollo, we will showcase our new Atlas MAX PLUS, which will take the Atlas MAX to a new level of productivity. Our new portfolio of smart curing solution based on TESOMA technology, our new RSS palettes, as well as our Atlas MAX POLY, Presto MAX, and KornitX solutions. We hope you will join us at ITMA to experience how Kornit Digital on-demand ecosystem will drive massive needed transformation in the textile and fashion industry. To summarize, as I mentioned on our last call, 2023 is a transition year for Kornit, and we remain laser-focused on executing in three key areas. Approach breakeven during the second half of this year on an adjusted EBITDA and then profitable growth thereafter. Successfully launching Apollo with beta trial expected to begin soon. Scale KornitX, where we are making some good progress with several demand generators. I take immense pride in our entire team's tireless effort and dedication to move the company. As I stated during our last earning call, Kornit's long-term growth drivers remain firmly intact. We are confident that our strategy, product roadmap, and solid balance sheet, combined with improvement in overall market condition, position us well to deliver meaningful, long-term profitable growth. With that, let me turn the call over to Lauri for a closer look at the Q1 number and the Q2 guidance. Lauri? Thank you, Ronen, and good day to everyone. As Ronen mentioned, Q1 revenues were $47.8 million, in line with the guidance range we provided in February. As expected, the year-over-year decline in revenues was attributable to meaningfully lower system revenues, primarily in the customized design market. While we did see double-digit growth in impressions from some customers, consumables revenues were essentially in line with the prior year period, due in part to the timing of some orders from a large global strategic customer. As Ronen described earlier, services revenues posted very strong year-over-year growth due primarily to customers upgrading systems to our MAX technology, higher contract revenue growth, as well as higher sales of print heads and spare parts. In the Americas, we had a very solid quarter of services growth, while overall system sales in the region remain challenging due to the macro environment, which continues to drive longer sales cycles. Looking at the pipeline in the region, we expect a healthy cadence of customer upgrades throughout the year, which will drive services revenues as well as positive trends in consumables as we see some signs of stabilization emerging. In EMEA, consumables growth was exceptional as compared with the same period last year, primarily driven by higher year-over-year volumes and ASPs. As expected, system revenues remained constrained, with customers increasingly seeking financing alternatives for capital expenditures. Our DTF portfolio continues to gain traction in EMEA as we added several high-quality customers during the quarter. The APAC region delivered robust services growth as compared with the same period last year, in addition to strong sales of Atlas MAX Poly systems in South Korea. We continue to focus on developing meaningful opportunities with strategic accounts and partnerships in the region, particularly in India, Japan, Australia, and China. For the balance of this year and for 2024, we believe the upcoming ITMA trade show in Milan will be a catalyst to not only close a number of transactions, but to also help build a healthy sales funnel of new opportunities across the regions. Moving to margins. Non-GAAP gross margin was 30.2% as compared with 41.5% in the same period last year. The year-over-year decline in gross margin was driven primarily by lower systems, volumes, and mix. We continue to expect gross margin improvement throughout the balance of this year, given the historical cadence of consumables as a percent of sales being progressively higher heading into the peak season and longer-term as sales volumes recover to a run rate that generates operating leverage on our reduced cost structure. Turning to expenses. Total Q1 non-GAAP operating expenses were $32.4 million, down approximately 8% from $35.2 million in the same period last year. The year-over-year decline reflects the impact of our previously completed workforce reductions and additional cost structure improvements we implemented across the board. This includes prioritizing R&D and sales and marketing initiatives, and reallocating resources from non-customer facing activities to development and customer engagement functions that enable the acceleration of our long-term growth engines. As a result of the above, adjusted EBITDA loss for the Q1 of 2023 was $14.7 million, as compared with adjusted EBITDA of $1.5 million in the same period last year. Adjusted EBITDA margin for the Q1 of 2023 was negative 31%, in line with the midpoint of the guidance range we provided in February. Our cash balance, including bank deposits and marketable securities at quarter end, was approximately $624 million. Cash used in operations during the Q1 was approximately $14 million, driven primarily by the operating loss and changes in working capital. In this regard, accounts receivable rose due to the timing of collections and a higher level of extended payment terms for system sales to select customers, while inventories were modestly higher to reflect the receipt of raw materials from suppliers and additional new systems, including Apollo. Further, during the quarter, we repurchased approximately 338,000 shares under our share repurchase program for an aggregate amount of $6.8 million, representing an average price paid per share of $19.97. As a reminder, we have an authorized share repurchase program for up to $75 million. Given our strong balance sheet, we believe that we can opportunistically repurchase shares without impacting our ability to execute on the company's growth initiatives. Turning to Q2 guidance. We currently expect revenues for the Q2 of 2023 to be between $54 million and $59 million, and adjusted EBITDA margins to be in the negative 19% to negative 27% range. As a reminder, the guidance for revenue and adjusted EBITDA margin includes the impact of the non-cash expense associated with the fair value of the company's warrants to our largest global strategic account. As I mentioned on our last earnings call, we expect to generate break-even operating results on an adjusted EBITDA basis as quarterly revenues reach a run rate of approximately $70 million, with gross margins in the mid-40% range, obviously depending on mix, and OpEx in the mid $30 million range. We continue to expect to turn the corner during the second half of this year and approach break even, and later on, move to profitability again on an adjusted EBITDA margin basis. With that, let me turn it back to Ronen. Thank you, Lori. Operator, now it's time to open the call for Q&A. Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star one. If you want to withdraw your question, please press star two. Your questions will be pulled in the order they are received. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Tavy Rosner from Barclays. Please go ahead. Hi, good afternoon, and thanks for taking my questions. I wanted to talk about system sales for a minute. You mentioned the challenging environment across most geographies. I'm wondering what the kind of pushback are you getting, especially from potential new customers. Are they pointing to financing issues or operational issues on their end? Do you feel that perhaps there is more, you know, education that needs to be made into the value proposition that you guys offer? Yeah. I'll take it. Thank you, Tavy, for the question. First of all, what we see there is the macroeconomics pressure, which in general it's tough for our customers and new customers to raise capital due to the interest rate. This is one element that we need to deal with. Sometimes we're dealing with longer payment terms in order to assist them, and sometimes connecting them to the right leasing program with third party that's supporting some capital investment. In general, we also see in the segment of the customized design, some customers are still having over capacity in terms of systems. Although as we mentioned on my script, we see an improvement. We see an improvement in utilization of the systems, mainly in key strategic customers, and we believe that they are going to go into a cycle of growth and investment in new systems. This is in general what we are looking ahead. We believe H2 will be stronger, much stronger than H1. We always said that H2 will be stronger. We believe that it will be stronger also in systems. In general, H2 from an ink perspective always much stronger. Peak season is by the end of Q3 and into Q4. On the service side, we expect a major growth in H2 as well due to some of the upgrades that we're expecting from our customer. We already had a very strong quarter this quarter. Q1 and Q2 also going to be strong on the service side from the upgrade. For the systems, ITMA will be a major catalyst in driving the growth on the systems. We are dealing with many customers, some of them new customers that will come to ITMA. We expecting hundreds of meetings there with prospective customers that ITMA will be the point that will take decision. We are very much focused on that, we expect to get many orders during ITMA, which will influence H2 this year. Thanks for that. Just the last one for me. You mentioned the scale-up of KornitX going on. Can you give any granularity of where that stands? Yeah. KornitX is still in a low scale. Although we see a few million dollars coming directly from KornitX, the good indicator that we have is that we see some good progress with few demand generator that are going. Some of them actually driving directly new sales of systems into the GSN. We see in the network of the GSN, the Global Fulfillment Network, some of them buying new systems, of course, more ink, due to the connection into demand generator. In Q1, we had very nice progress. We are working on business development with some major digital platforms, on social media platform, gaming platform, entertainment platform, and we expect some of them to be on board at H2. Of course, you're familiar already with Wix.com and Canva that are on board, but there are other major platforms that we would like to bring on board in H2. All of it will drive growth to system and impression. It's important to look at KornitX not only in the direct contribution of dollar that are going through the transaction, but also on the indirect fulfillment that is going into our GFN customer base, that buying more ink and more system due to additional demand that they're receiving. Great. Thank you for that. Thank you, Ronen. Thanks, Tavy. Next question, please. Thank you. Your next question comes from Brian Drab from William Blair. Please go ahead. Hi, guys. Good morning. This is Blake on for Brian. Hey, Blake. You guys have already talked about the upgrades, that you experienced in the Q1 and that your expectation for them to as we progress through 2023. I was just wondering, if you can give any more granularity there on the upgrades, and the cadence, you expect as we go through the year. What I can tell you, and we mentioned it, that in Q1, we got orders for few key customers, strategic customers for about sixty. They upgrade from Atlas to Atlas MAXes. This is after continued momentum in second half of last year. We expecting this momentum to continue in Q2 and in H2 and into 2024. We have few of our major customers that are now considering to move into the MAX technology, it will influence both 2023 and 2024. What is important to mention that the MAX technology now is becoming the standard of the industry, customer understand that they have to move there. We are expecting to see not only an upgrade from Atlas to Atlas MAX, we are looking now deeply into our install base that using Avalanche and Storm and helping them to trade in and to go into the Atlas MAX technology or the MAX technology, that is now the new standard and the best-in-class quality and durability and productivity in the industry. Got it. Thank you. Then, when you guys talk with customers, have you seen customer buying activity muted, not only by the macro environment, but also sort of frozen ahead of the ITMA show, waiting to see all the new product intros? Yes, absolutely. I mentioned before we are talking with many, many customers across the world and potential customers. We expecting very big delegation coming from Latin America, from Asia Pacific. Of course, Europe is a big, big show for Europe, and even from North America. We have customers and prospective customers are telling us, "We are waiting for ITMA to take final decision. We would like to meet with the senior management. We know that you're probably going to do good deals at ITMA, so we are waiting there." Of course, some of them would like to see the Apollo. We are going to unveil for the first time the Apollo, which is a breakthrough technology, and many, many customer were waiting for it, some strategic customers, some new customers. We are entering with the Apollo to totally new markets, which is the screen market that are providing services for brands and retailers. For the first time, not only we are bringing the MAX technology, but with the highest productivity of about 400 T-shirt an hour or pair per hour, with full automation of 1 operator that can run the entire solution connected to in-line dryers, which is based on the Tesoma technologies that we acquired a year ago. As I mentioned with the best print quality and productivity. ITMA is going to be a milestone. Looking back at 2018, where was the last ITMA in Barcelona, ITMA had a major impact on the last four years for Kornit. We believe that this time, with the MAX technology and what we are bringing to ITMA with the Apollo, with the DTF and demonstration of the new ink that we are bringing, with the Atlas MAX PLUS, which bring the productivity to a new level, with the RSS, with the full line of Kornit Tesoma technology, with smart drying and much more with KornitX. Of course, now that we are gaining momentum on the Atlas MAX, Atlas MAX Poly, we believe that ITMA will be very meaningful for Kornit and for our future. Got it. Thank you. I'll pass it along. Great. Thanks, Blake. Sir, the next question, please. Thank you. Your next question comes from Erik Woodring from Morgan Stanley. Please go ahead. Hey. Good morning, guys. Thank you for taking my question. Maybe, Ronen, if I start with you. You know, historically, how should we think about, you know, both the correlation and the lag between, you know, impression growth and then system sales or ink and consumable sales? Meaning, like, if we're seeing good impression growth today from select customers, how does that usually flow through on the Kornit side to actually monetize that? Maybe I'd ask the same kind of question about, you know, the ordering of print heads and spare parts. Is that a leading indicator that we should think about, or is that just a bit more of a unique one-off? Then I have a follow-up. Thanks. It's a good question. I would say, I'll try to do it briefly. Look, the best indicator, leading indicator for our business is the health of our customers. The health of our customer is the what we call impression. What is the trends on the impression? How many impressions they are printing? Is it going up or going down? Last year, we saw the impression in many customer going down. We started to talk about in H2 that we starting to see a new trend that is starting to move up. Definitely in Q1, we saw a growth in the impression in some of our customers, actually strong double-digit growth, including our global customer, global strategic customer, very, very strong growth. This is a major indicator that things are changing. If that's, if the impressions are growing and the utilization per system is growing, which mean the customer needs more capacity, and they will go through a cycle of buying not only more ink, but more systems, and more productive systems. Some of them now will get into finally upgrading their old systems into the MAX technology. It's definitely a very healthy indicator moving forward. Okay, that's super helpful. Maybe I'll direct the second question to Laurie, and that is just, you know, I think today, call it over 70% of your market cap is effectively in cash. I realize that you guys have the buyback authorization for $75 million. You know, I'd imagine when you look at your stock today, you'd call yourselves intrinsic value buyers of your stock. Why not just maybe get a little bit more aggressive on capital returns or buybacks, just given, you know, the strength of the balance sheet, the cash balance you have, where the stock is today? Would just love your thoughts on that. That's it for me. Thanks so much. Okay. As you know, we purchased about $7 million of our common stock in the Q1. Given the points that you just made, we do expect to be more active in the Q2, given these current trading levels. Again, we agree with you that, we believe the company's current low enterprise value severely discounts our prospects to generate long-term growth and profitability. Fair enough. Thank you. Great. All right. Thanks, Chad. Next question, Sergio. Thank you. Your next question comes from Chris Moore from CJS Securities. Please go ahead. Hey, guys. Thanks for taking a couple questions. Yeah, I was hoping that you could talk a little bit about the current competitive environment that you're seeing with respect specifically to Apollo. I would say, Thank you, Chris, first of all. The main competition that we see for the Apollo is, of course, the analog market, is the screen market. There, most of the impressions, 99.9% of the impressions are running there. For the first time, Kornit is going to penetrate the screen market. Just to remind everyone, more than 90% of our businesses of today is coming from the enablement, from customized design. Most of our customers are running very short runs, most of them running 1-off through the e-commerce. Is for the first time we're entering to a much, much bigger market, bigger sum with the Apollo. We couldn't do it before from several reasons. One of the reasons that is print quality. Our print quality was always the best in the digital, but wasn't good enough for the retail and for the brands, and as a replacement for screen. Today, with the MAX technology, our quality not only as good as screen, in many cases, in photographic images, much better, and definitely in durability and other aspects. This is one thing. The another milestone was the productivity. We bought now the Atlas MAX, but the Apollo can bring productivity like 3.5 times of the Atlas MAX, which is in par to the productivity or the speed of running a screen machine, a very large screen machine. However, the productivity is much, much better because if you look at the shift, half of the time of screen machine, screen system is idle because you need to replace screens and clean and change inks. With digital, there is no idle time between jobs, so the machine is much more productive. On top of that, we are aiming with the total cost of ownership to be in a competitive position, definitely in front of screen on every job below 500 run lengths. If we're looking at this market of 500 run lengths and below, we are talking about billions of impressions that we are going after. The opportunity here for Kornit is really to disrupt the market and to become a big player in totally incremental market until today we didn't address. Got it. How helpful. Thank you. Just my follow-up, obviously, you guys are very excited about the ITMA show in June. Just trying to get a sense as to, you know, kind of what a reasonable expectation for Apollo is coming out of there. Is it X number of orders? Is it you know, X number of betas that are committed to? Just, you know, kind of your thoughts there. Beta already signed, and actually, we already shipped a machine for one of our customer on the beta, and we already shipped the machine for ITMA. At ITMA is, for us, is a sales event. We are very, very much focused not only selling the Apollo, of course, selling the Atlas MAXes, the Presto MAX, the Poly, and many more solutions that we have on the floor. We have a clear targets on how many orders we would like to get per regions for the Apollo already in 2023, but we are very much focusing also with the Apollo in 2024. We aim to start building a backlog of order for 2024 out of this event. It's a very meaningful event. Our team is very much focused, and I hope to be able to update you immediately after ITMA on the results. Got it. It's helpful. I'll leave it there. Thank you. Thanks, Chris. Sergio next question. Thank you. Your next question comes from Jared Maymon from Berenberg Capital Markets. Please go ahead. Hey, good morning, guys. Thanks for taking the questions. Hey, Jared. Just had, I guess first one. We talked a little bit in the past about kinda pushing the sales team from a transactional model and going to the same pool of customers to a customer growth model. I'm just curious, how has that effort been kind of in the start of this year and into the first half of Q2? Any interesting insights you guys can give us based on who's indicated that they're going to join you at ITMA? Yeah. First of all, if you look at Q1, many of the deals actually, 50% of the deals are net new. Some of those net new are retailers and that looking to change their business models. We see more and more successes of going after those mid-size retailers, brands. Some of them would like to go vertically and buying systems, some of them working through KornitX into the GFN, and we're starting to see more and more success in this business model. On top of that, looking at the replacement market, I was talking before on the screen with the Apollo, but we actually starting to see us entering to the replacement market with the Atlas MAXes. Also it was a very strong quarter for the Atlas MAX POLY, which is going mainly for the replacement market at the athleisure segment. Another area which is starting to be more meaningful and is mainly focused on replacement versus enablement is DTS. We have continued success, but now it's becoming more meaningful. We are entering to much larger players in the market. We expect to see multiple system sales to those players with much larger volume that they are using. The entire market we see moving onshore, looking into on-demand manufacturing of short runs, being able to do changes in different designs on a daily basis. A major factor of moving into Kornit technology is our ink, our pigment ink, which this industry has a lot of pressure now, regulatory pressure, to move from reactive and acid and being very polluted industry, and consuming a lot of water to move into pigment. We have by far the best pigment ink in the industry, in terms of durability, in terms of hand-feel, in terms of vibrance of the ink. At ITMA, we are going to surprise the industry with new type of ink, which I leave it to ITMA to tell you more what this ink is going to do. I'm going to tell you that this ink will drive Kornit to the mainstream of the fashion industry. That's great to hear. Thanks, Ron. I'm looking forward to hearing about the new ink. I guess just one more for me. At this point, the year's kinda flying by, you know, almost halfway through 2023, and ITMA's only about one month away now. Just starting to think a little bit more about the Apollo and kinda the potential in there in the first year. I know you kinda already talked about how beta interest has been, but I'm just kinda curious how you guys are thinking about it. If that system delivers on the specs that you've outlined, anything that you can kinda tell us on what your expectations are for the first year? Are you kind of expecting top 10 customers to come in and purchase a number of these systems, or are you expecting more growth from new customers or non-top 10 customers? Just lastly, I think in the past, correct me if I'm wrong, but you've kind of had this dynamic where rising ASPs have also resulted in a boost to gross margin in some cases between system cycles. Just curious if you're expecting that to continue with the Apollo. Wow! Many question. I hope I capture all of them. First of all, in terms of interest, we have a lot of interest coming first of all from the screen market, from existing customers, but a lot from new incremental customer incremental segments that we are going after. Actually, I give you an example. Last week, we have a full week with two leading customers that today are running our systems, but they are running it mainly as a screen replacement. They were running the Apollo here in Israel for the full week. I can tell you, they were blown away. They were blown away. They, of course, learned a lot about the system before coming here. They saw videos and all those things. To run it live is unbelievable. The systems run at the speed of up to 400 shirts an hour in full automation on only one operator helping the system a bit to load, but most of the work are being done by the system. The quality is phenomenal. This machine is really going to change the industry. In terms of you asking in terms of gross margin, the way we are looking at it is really about the ink. As you know, we have nice gross margin on the system, but much better gross margin on the ink. Those systems are going to generate a lot of ink usage because of the productivity, because of those that buying it is going to use it at least two shifts and around the clock. We believe that those will contribute both to the revenue meaningfully, but definitely to the gross margin moving forward. Loud and clear. Thanks, Ron, and looking forward to seeing you guys in November. Any other question I missed? Any other point that you wanted to hear that I missed? Nope. I think you hit on it all. Appreciate it. Thank you very much. Thanks, Erik. Sergio, next question. Of course. Our last question comes from Greg Palm at Craig-Hallum. Please go ahead. Yeah, thanks. This is Danny Eggerichs on for Greg today. Just hoping to touch quick on your thoughts on the path to profitability. I think the verbiage is to approach break-even EBITDA in the second half. I guess just given where we are at in the macro right now, I mean, is actually achieving break-even profitability, does that get pushed out at all? What are your thoughts on that? I'll start. Maybe Lori can add on top of that. As we promised to the market, we are aiming to approach break-even during the H2 of the year, and we feel confident achieving it. Now, on what does it based? We mentioned very clearly, to be break-even, we need a run rate of $70 million of revenue. We need to be somewhere in the mid-40s% for gross margin, and in terms of OpEx, in the mid-30s% on the OpEx side. It all depends now on end revenue, because the major impact that we have in gross margin is on the volume, on the systems, on the revenue. When we break the revenue into three parts, which is systems, inks, and services, we feel very confident, and we have very good line of sight to the service business. We have very good confidence and line of sight to the ink business and how much it will impact into H2. We are walking and counting on ITMA to help us to ramp up the system volume at H2. When we're looking now at the funnel that we're building into ITMA and what we're expecting to come out of ITMA, I can tell you, we feel confident to deliver what we promised, approaching break-even during the H2 of this year. Got it. makes sense. I guess your global strategic customer sounds like they're starting or they've been installing some of those delayed systems, I guess. Since the last time we talked, any update there? Still expecting to, you know, restart contribution, system contribution again in 2024? In terms of the relationship, we have a great relationship with our global strategic customers. We are meeting with them on a daily basis and a weekly basis, and QBR with the senior management on a quarterly basis. They're sharing with us our three years plans, and we are working very, very closely. They had a very good peak season. They continued to grow in Q1, strong double digit, and we start to see them in beginning of Q2 with nice orders of ink, which indicate again, another strong quarter. This is on top of now delivering or installing the system that they purchased last year, and there were delay in those sites that we wanted to open. Now the sites are almost ready. We are installing the systems now, and they will be ready to run before the peak season. We expect to see accelerated growth of impression and ink usage during H2 and mainly into Q4. We are looking forward to continue growing with our global strategic customers. There are different paths of growth. One area of growth is, of course, upgrading the fleet into the MAX technology. We went through a deep qualification. We qualified, they understand the value of the MAX, and we are waiting now to get the POs, and probably it will happen only in 2024. There are other paths of opening new sites. They are very deeply involved in the Apollo and looking forward to start testing the Apollo early 2024, and later on, of course, to open sites based as well on the Apollo. We are looking on expanding our business with them on the fashion side. There's many, many areas, of course, they've also aged fleets of other launches that we are looking forward to trade them, upgrade them with new technology for the Atlas MAX or the Apollo in the future. All right. Got it. I'll leave it there. Thanks. Thanks. Thank you. Thank you. Mr. Backman, there are no further questions at this time. You may proc eed. Great. Thank you, Sergio. Thank you all for joining us today. As always, if you have any follow-up questions, please do not hesitate to contact me directly. Sergio, will you please close the call? Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Thank you.