Today, and thank you for standing by. Welcome to the Q1 2021 Luna Innovations Incorporated Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question- and- answer session. To ask a question during the session you’ll need to press star one on your telephone. If you require further assistance, please press star zero. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Allison Woody, Director of Administration. Please go ahead. Thank you. Good afternoon, and thank you everyone for joining us today. This afternoon, we issued our Q1 2021 earnings press release. We posted to the Investor Relations section of our website a presentation with supplemental information for the quarter. If you do not have a copy of the release or the supplemental materials, please check our website at lunainc.com. We will also post a replay of this call to our website. Some of our comments and discussions today are based on non-GAAP measures. These adjusted numbers exclude the effects of certain non-cash expenses and other items. The adjusted results are a supplement to the GAAP financial statements. Luna believes the presentation and exclusion of these items is useful in order to focus on what we deem to be a more reliable indicator of ongoing operating performance. Before we proceed with our presentation today, let us remind you that statements made on this conference call, as well as in our public filings, releases, and websites, which are not historical facts, may be forward-looking statements that involve risks and uncertainties and are subject to changes at any time, including but not limited to statements about our expectations regarding future operating results or the ongoing prospects of the company. Actual results may differ materially as a result of a variety of factors. More complete information regarding forward-looking statements, risks, and uncertainties is available in the company's SEC filings, which can be found on the SEC website and our website. We disclaim any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments, except as required by law. After our prepared remarks, Scott Graeff, our President and Chief Executive Officer, Gene Nestro, our Chief Financial Officer, Brian Soller, Chief Operating Officer, and James Garrett, Senior Vice President and General Manager of our Luna Labs division, will be available to take your questions. At this time, I'd like to turn the call over to Scott. Good afternoon, everyone. Thanks for taking the time to join our call. It's amazing to me that as we sat here today in the middle of May 2021, we have more than lapped a year since the beginning of the COVID pandemic. Like many of you, I'm very happy to see most of our colleagues having been fully vaccinated and seeing a return to some level of normalcy. For Luna, we started the year very focused on basic blocking and tackling. You may recall that throughout last year, we continued to put into place many of the processes and systems that will allow us to scale well into the future. We are continuing to roll out the use of new tools, including the January 1st go live of our new ERP system. We made these investments because as we look forward, we see an abundance of opportunities for strong and rapid growth. We need to ensure that we are well-positioned for that growth and can scale comfortably. You should expect to see us continue to invest in our business as we progress through this year and into 2022. Many of you will remember that several years ago, as we approached an important step function in our growth, we spoke frequently about the hiring of sales and engineering talent and other resources to help us drive that growth, and we are in a similar position now. We are incredibly excited about all the opportunities we see. In addition to making appropriate ongoing investments, we also recently undertook a review of our organizational structure to ensure we're configured in such a way that we could capture future growth. We are very clear on our strategy, structure follows strategy. We decided the time was right to create a new position in Chief Operating Officer. I'm pleased to say that we promoted Brian Soller, who has been running our Lightwave division, into that new position. Many of you have met Brian and can likely appreciate that he is the perfect leader for this new executive appointment. I've known and worked with Brian for nearly 20 years, as I said in the original announcement, Brian has a strong strategic mindset and vision, combined with a sharp focus on operational excellence, and is uniquely qualified to drive strategic prioritization and accountability within the company. I want to point out that the timing of making this kind of change was not happenstance. The Board and I believe that this was the right time to appoint a position of this level, as we're at another inflection point in our evolution as an organization and need to further position the company for robust growth. We've worked hard to establish a strong, scalable foundation for this organization, which positions us well to execute the necessary strategic moves, including M&A, and to support a focus on our fiber optic capabilities. Brian's breadth of industry knowledge, decades-long proven track record, and unique mix of business and management expertise make him the perfect candidate to lead Luna's operations into the future. I am confident that Brian will continue to do great things. Reporting to Brian, we made several other important moves. Salvan Farooqui was promoted to Senior Vice President of Worldwide Sales, a new position. You may remember Salvan's name. I mentioned it in connection with the large Lockheed Martin order that we announced at the end of last year. Joe Berte was promoted to Vice President of North American sales, replacing Salvan in that role. Joe's been a top performer with Luna for nearly a decade after leading sales efforts at some of the industry's best technology companies. We are very excited to have him leading our North American sales. Jamie Pollard was promoted to Managing Director and Senior Vice President of EMEA operations. Jamie came to us through the acquisition of OptaSense, which he had run since joining the company in 2015. Previously, Jamie spent 25 years in various executive roles at Schlumberger. Yves LeMaitre was promoted to Senior Vice President of North American operations. Yves also joined us through the acquisition of OptaSense, where he has served as the President of the RIO Laser business. Finally, as you saw from our press release this morning, I'm absolutely thrilled to have Bill Van Anglen joining the Luna team as Senior Vice President and Head of Human Resources. You've just heard me discuss the immense opportunities for growth that we see before us. Without the right human capital strategy and corporate culture in place, obtaining that growth becomes much more difficult. Bill brings years of tremendous experience in scaled, complex, and global organizations. He has served in leadership positions in a variety of technology companies in various stages of maturity. Importantly, Bill has deep experience in acquisition due diligence and integration, which will be critical to our future work in M&A. Bill has extensive experience in building and nurturing the right culture for organizations as they grow. We believe Luna has an outstanding culture, and Bill will be in charge of working directly with me to make sure that we continue to be inclusive, thoughtful, and supportive in the right way of our employees. Congratulations to all these executives, and I'm thrilled to be part of such a great team. This is all about getting the right people into the right positions so that we at Luna are poised and prepared to move quickly to solve customer problems, to innovate with speed, and to be nimble in adjusting quickly to changing market conditions and customer needs. We continue to be focused sharply on our purpose to enable the future with fiber, and we will continue to make the changes necessary to capture the opportunities in front of us. Now, I'd like to move on to some of the financial highlights for the Q1. For the Q1 2021, total revenues were up 53% to $26.3 million compared to the prior year's quarter. The Lightwave segment had an increase of 82% year-over-year to $21 million in total revenues, and Luna Labs revenue was $5.3 million, down 5%. We reported an operating loss of $800,000. The year-over-year decrease in operating income was primarily due to $1.4 million of integration, transaction, and amortization of intangible asset costs relating to our recently completed acquisitions, as well as our continuing portfolio activities. We delivered adjusted EBITDA of $2.1 million in Q1 versus $1.6 million in the prior year period. Now, let me discuss Lightwave in more detail. As a reminder, our Lightwave solutions focus on two areas, sensing and communications testing. For the Q1 2021, total Lightwave revenue was up 82% on a year-over-year basis, driven by both the acquisition of OptaSense and strong commercial sales in legacy Lightwave, particularly in comms testing. Digging a little deeper into the sensing segment, revenues grew over 100%, driven both by organic performance and by the acquisition of the OptaSense product lines. As a reminder, we added the OptaSense Distributed Acoustic Sensing, or DAS technology, to gain access to fully distributed measurement capabilities over long range applications to augment our already industry-leading line of fiber optic sensing products. The addition of long range distributed capability to our offerings establishes Luna as a new global market leader in fiber optic sensing with diversified geographies and applications. An example of this was demonstrated in an announcement we made last week about our partnership with Liberty Oilfield Services. This strategic partnership is introducing FracSense, which is a diagnostic service to help engineering professionals and our oil and gas customers acquire more accurate diagnostic information. We can do this by using Luna's fiber optic measurements acquired through OptaSense, delivering real-time data and visualization. It's important because it will allow our customers to optimize their hydrocarbon production, which in turn allows their operations to have less of an environmental impact. Sticking with the sensing vertical, for the terahertz product line, we saw new wins in process control with large corporate customers in the automotive and aerospace industries, which drove strong double-digit growth in our terahertz and ODiSI product lines. In addition, we have visibility to a strong start in terahertz for Q2, with a significant multiple unit order booked with a prominent auto manufacturer that needs our capability for their electric vehicle battery production line. Switching to the communications test vertical. These product lines grew 42% year-over-year. For some additional clarity, it's important to know that the RIO Laser business, acquired through the acquisition of OptaSense, is included in our comms test results. With the addition of the RIO Laser products and the General Photonics products we had added in 2019, this business is now about 50% test and measurement for communications devices and 50% optical components and laser modules for a variety of photonic applications such as medical devices, sensing systems, and LiDAR. If we look at the legacy parts of the comms testing, our core products, the OVA and OBR, led Q1 with strong double-digit 17% growth. In general, comms testing drove a significant overall improvement in commercial sales over the last year, with multiple system sales to large corporate customers. You'll remember that last year, we announced the introduction of our newest product, the OBR 6200, a field-portable version of our industry-leading optical backscatter reflectometer, which allows fast and accurate troubleshooting of fiber networks in the field. We also announced our exciting partnership with Lockheed Martin and their order for over 100 units in Q4 2020. Our deliveries to Lockheed have proceeded without interruption throughout Q1, and we're happy to report that our efforts have been well-received. These units are already being deployed in the field to help troubleshoot issues and keep the fleet of the F-35 aircraft ready for service. In terms of new customers for the OBR 6200, we added several important customers in the defense space in Q1, as well as multiple new customers in the data center space for latency testing. In addition, we made progress in commercializing the RIO Laser outside of the core DAS market. We successfully designed, qualified, and built a RIO semiconductor laser to be used in the NASA Navigation Doppler Lidar system. The selection of Luna's RIO laser highlights our unique capabilities in the development and production of rugged, high-quality semiconductor lasers for emerging applications such as LiDAR. Let's move on to a discussion of Luna Labs, where, as a reminder, we leverage third-party contract research to build a portfolio of technologies. These technologies, which are commercialized through direct sales, distributors, or license agreements, are outside our core strategic fiber optic offerings. In terms of the quarter, Luna Labs was down slightly on a year-over-year basis, and COVID was certainly a factor. Several partners had to push out work that they had been planning to do in the quarter, and that affected work on our end. We saw this dynamic across several of the markets into which we sell. We expect to return to more normal levels in Q2 and will be delivering this month an order of our corrosion monitoring product to Lockheed Martin Space for use on the Orion spacecraft. We first talked about this last September. These have been selected for the NASA Artemis missions to bring the first woman and the next man to the lunar surface. We've worked with Lockheed Martin Space and NASA to adapt these units to accommodate lengthy missions in deep space, helping to achieve spacecraft reusability, which is a key cost saver for sustainable exploration of the moon and beyond. In addition to the RIO Laser for LiDAR that I mentioned previously, this is the second Luna technology that has been selected by NASA for the Artemis mission. We also wrapped up a 30-month project with a large technology company. This project was significant because it represents a great example of how the expertise we've developed in the government and defense domains transfers to commercial sectors. As you know, we acquired OptaSense in December and have been actively integrating since then. You have seen us systematically refocus our business to pursue our vision of enabling the future with fiber. We've been aggressive about divesting assets that don't fit with our long-term growth strategy and acquiring other key assets that are in our sweet spot and will help to drive further growth. That's exactly what we did with the OptaSense transaction. We expanded the part of our business with the greatest growth potential, fiber optic-based test and measurement and fiber optic sensing. This is our Lightwave segment. As a reminder, in 2020, we also did a tuck-in acquisition of New Ridge Technologies. New Ridge's solutions are a perfect complement to our communications test and measurement portfolio, and although quite small, it is strategically very important to Luna and helps to advance our product roadmap. As a reminder, the integration of New Ridge's products with Luna's helps our customers to enhance connectivity by developing faster communication networks to support everything from the 5G build-out to the continued expansion of bandwidth inside data centers. New Ridge is already fully integrated into Luna, and we're well on our way with the integration of OptaSense into Luna's Lightwave business. As I mentioned last quarter, certain support services will continue to be provided by the former owner under a TSA for at least a portion of this year. Our sales and marketing teams and our technical teams have been working together for almost six months now. Things are going well, and I'm very pleased with what I've seen. There is no question that the acquisitions from last year have already become an important part of Luna, and I'm excited to say that even in the first several months, we are seeing some incremental opportunities. We will continue to be an acquisitive company, sharply focused on building our capability and expertise in fiber. Of course, we will only do those deals that make sense from both a financial and cultural perspective. One of our key priorities will always be the prudent and thoughtful deployment of capital. Before I turn the call over to Gene, I want to cover our outlook for 2021. We continue to be extremely optimistic about 2021 and are reiterating the 2021 outlook range we provided last quarter, which is total revenues of $122 million-$127 million and adjusted EBITDA of $16 million-$19 million. I also want to remind you again about our typical seasonality, which is the recognition of approximately 44%-46% of annual revenue in the first half of the year, with a larger portion of the annual results being realized in the second half of the year. We're right on track with that seasonality for 2021. In summary, the year for Luna is off to a good start. As I said in the beginning, our activities for the Q1 of 2021 are best described as fundamental blocking and tackling. We've been focused on integrating the large acquisitions, changing our processes to take advantage of our new systems, and making the necessary organizational structure changes to ensure we have the right leadership and teams in place. I am very confident that Luna has the right strategy and will continue to make significant progress against it as we progress through this year. I'll now hand the call over to Gene for more of the financial details on the quarter. Gene? Thank you, Scott. Before I proceed, I want to note that our reported numbers include the results of the two acquisitions we completed towards the end of last year, New Ridge Technologies and OptaSense, and their related integration, transaction, and amortization expenses. In addition, our results also include expenses related to our continuing portfolio activities. With that as background, I'll now shift to cover our Q1 results. As Scott noted, our revenues for Q1 2021 were $26.3 million compared to revenues of $17.1 million for Q1 2020, representing a 53% year-over-year increase. The increase in revenues was composed of an 82% increase in our Lightwave segment and a 5% decrease in our Luna Labs segment. Within the Lightwave segment, year-over-year growth was driven by our acquired businesses and strong performance from both our sensing and communications test businesses, including particularly strong commercial sales in our comms test space, resulting in double-digit growth. As you can see, Luna Labs was down year-over-year. As Scott mentioned, COVID was a factor. We heard from several partners that they were unable to do certain work, which pushed out planned work on our end. As an example, the decrease was driven partly by lower sales of our TrueClot line of bleeding control training products as face-to-face EMS and first responder training were affected by COVID restrictions. Our gross profit increased to $13.4 million for the quarter, compared to $8.4 million for the same quarter last year, representing a gross margin of 51% in Q1 2021 compared to 49% in Q1 2020. Gross margin improved as Lightwave grew and became a larger percentage of Luna sales. Recall that Lightwave has a higher gross margin than Luna Labs. While not material to the quarter, I would like to point out that gross profit does include approximately $0.2 million of non-cash amortization of inventory step-up related to our recent acquisitions. We expect approximately $0.2 million in Q2 with slightly lower amounts in Q3 and Q4. The inventory step-up will be fully amortized in Q4 2021 with no carryover to FY 2022. Operating expenses were $14.2 million in Q1 2021, which includes $1.2 million of amortization, integration, and transaction costs related to our recent acquisitions and ongoing portfolio activities. Our Q1 2021 OpEx as a percent of revenue is up slightly year-over-year, and you may continue to see this as we aggressively invest in our business for our next stage of growth. Just to be clear, Q1 2021 OpEx includes this $1.2 million, which along with the $0.2 million of amortization of inventory step-up included in gross profit, negatively impacted our Q1 2021 operating income by a total of $1.4 million, as Scott previously mentioned. Due in part to this $1.4 million, we recognized an operating loss of $800,000 in Q1 2021 compared to operating income of $400,000 in Q1 of last year. I would like to take a moment to talk about our amortization expense included in our operating expenses. In Q1 2021, we have approximately $840,000 of total amortization expense. This includes amortization of intangibles related to our prior acquisitions and our recent OptaSense and New Ridge Technologies acquisitions, along with amortization of our patents. We expect total amortization expense and operating expense of approximately $820,000 per quarter for the rest of 2021. We do disclose annual amortization by year in our 10-Q, so you can refer to it for future amortization expenses. As a reminder, if we acquire additional companies, we expect to have additional amortization related to those acquisitions. Net loss for Q1 2021 was $300,000 or a loss of $0.01 per share, compared to a net loss of $1.1 million or $0.03 per share for Q1 2020. Adjusted EPS was $0.03 per share for Q1 2021 versus $0.02 for Q1 2020. Income tax benefit for Q1 2021 differs from our statutory rate primarily due to equity compensation. We estimate our 2021 effective tax rate to be 22%-25%. Finally, a key metric reflecting our underlying operations is adjusted EBITDA. As Scott mentioned, adjusted EBITDA increased to $2.1 million for the Q1 of 2021 versus $1.6 million for Q1 2020. Let me now move to the balance sheet. We ended the quarter with $11.8 million of cash and cash equivalents, compared to $15.4 million at the end of 2020. The decrease was largely due to the cash payment of accrued deal related expenses. Our working capital was $47.3 million at March 31, 2021, compared to $45.4 million on December 31, 2020. Remember that at the time of the OptaSense acquisition, we announced a new debt facility comprised of two separate financing vehicles, a term facility, and a revolving facility. At the end of the quarter, we had total debt outstanding of $18.9 million. Of that amount, $11.4 million is in term debt and $7.5 million was drawn in our revolver. We have access to an additional $7.5 million in the revolving credit facility should we need it. As I mentioned last quarter, we exited 2020 stronger than when the year began as a result of a series of strategic acquisitions, continued operational improvements, and further investment in our core foundation of the company. I am very comfortable with the reaffirmation of guidance today and am very bullish on the prospects for Luna in 2021. With that, I will turn the call back over to Scott. Thank you, Gene. At this time, I'd like to open the call for questions. Brian Soller, Chief Operating Officer, and James Garrett, Senior Vice President and General Manager of our Luna Labs division, are with Gene and me at this time and also available to address questions. As always, I want to assure that the proper folks were on the call today to address any specific business questions you might have. Lori? As a reminder, to ask a question, you will need to press star one on your telephone. And to withdraw your question, press the pound key. Our first question is from Barry Sine from Spartan Capital Securities. Your line is open. Hey. Good evening. A couple questions. First of all, on the Labs R&D work, do you expect to make that revenue up back in the next three quarters so that the full year is unaffected, or is that revenue kind of gone forever? No, that revenue I'll let James address it because he knows specifically, but what we went through when we went through this, and anyone on the call knows as unusual that is with the Luna Labs being slightly down. That just pushed into Q2, and some of that has already been captured here in early Q2. James, you want to? Yeah, sure. Hey, Barry, this is James. Like Gene said, some of this was COVID related. We had partners and subcontractors that couldn't get work done over the winter. Either people were working remote or just didn't have the resources. That's still work that is on the contracts that we have. That's work that we need to do, and so that'll get captured later this year. It's more of a timing event than revenue that is lost. We're going to pick that up later in the year because that is still on the contracts that we have. It's stuff that still needs to get done. My second question, on the slide deck in the Q1 highlights, the third bullet point talks about functional integration of OptaSense will begin after the first year. Sounds a little curious. What exactly are you not integrating? Are you not integrating the product lines or the sales force, will customers now get calls by two, Luna sales rep and OptaSense and a Luna sales rep? Continuing on that point, the financial impact of that, you had some non-recurring integration expenses. Does that mean that those will continue into 2022 when you actually do the integration? How does that lack of integration impact the margins? I'm assuming the margins will be lower with them not integrated and standalone than they would be if the company was integrated. Thank you. Yeah. Quite a bit in that question. Let me try to address some of it, and I'll let Brian address it. Barry, what we were talking about was, keep in mind, I haven't been able to, Brian hasn't been able to be over to the U.K. yet. Jamie is running that operation, will continue to run that operation. We just haven't been able to integrate some of the sales teams. We have calls. The guys are talking to each other, but we haven't fully integrated some of those operational savings and sales savings yet. They will. You saw the appointment that we made to Salvan Farooqui running all of sales. He will get to know, and as travel opens up, get to see some of these products. There will be some synergies that will be shared over time. Just right now, we just need to continue to focus on delivering. As an example here, this was the biggest bookings quarter we've ever seen. When you see sometimes we're still having some lingering effects, especially in Q1, of some COVID-related items where the order is in-house, but we cannot deliver on the order because the customer may not be working in the field for us to show up. There are some delays, and those are all things that are just being pushed. We've had several orders that were slated to be delivered in Q1 that have already been delivered. Just like we were talking about with Luna Labs, there's things that have been done in April that just kind of slipped due to some movement around on the COVID. I'll let you talk a little bit more, Brian, about the integration of what's going on and why we're doing it in the stage of what we are. Yeah. Hey, Barry, this is Brian. We're just taking a very measured, thoughtful approach to making sure the integration goes properly, given some of the limitations of travel, and Scott already hit on that. This process would take about this long, I think, anyway. These locations, overseas in particular, all have functional groups in engineering, sales, marketing, finance, administration, et cetera. We will integrate all those groups under the different levels of leadership that we've already described some of on this call. That will get to be a little easier to do when we can travel a little bit here going into later in the year. We had always said that for the OptaSense acquisition, we were acquiring a fully functional business that would stand on its own, and it would operate that way for about a year. We're right on track with that. I'll let Gene talk to the financial points. From my perspective, there'll be no impact on gross margin as it relates to these integration elements. No. Thanks. Yeah. Just to be clear, on the IT systems, we had to unentangle them from their parent company and stand them up on their own. From an IT perspective, that's essentially complete. I think we have another week or so to go on that. We'll be off of the IT TSA. In relation to those costs, they were spent about 50% in Q1 and about 50% through this quarter. Financial systems, they're mapped into our consolidation process, from that perspective, I would say we're essentially complete with those. Next year, when you do the full integration, what financial impact should we expect to see when it's fully integrated? On the system side? On the financial side, on the operating margin, I guess. I'm assuming lower overhead costs. They don't have a lot of overhead within OptaSense. Both of us, they run an SAP version that's similar to NetSuite that are both cloud-based, really your only cost there are storage and licensing. There's not going to be a lot of savings from that. We're all fairly lean on the back office accounting side. These integration efforts amongst engineering, sales, and marketing will really result in some more internal efficiencies, and teams working more well together under some common leadership. That's kind of the way to think about those remaining integrations that we have to do. There's not a lot of heavy lifting in terms of systems or any, what I'd say, material costs. Again, I'll let Gene speak specifically to that. The benefits will be more of a coherent approach, for instance, into the market with products and with customer wins. We're already doing all of that. Those teams are already working together to leverage those activities. They'll have a common reporting structure as we get through the end of the year and get fully integrated. Right. Yep. Okay. That's my question. Thank you, gentlemen. Thanks, Barry Sine. Our next question is from Jim Marrone of Singular Research. Your line is open. Yeah. Good afternoon, gentlemen. Just want to talk about the Lightwave revenue. I think you may have mentioned it in the prepared statements. Just in regards to the 82% revenue increase, was there any sense of how much of that was organic revenue stripping out the acquisition impact? Just as a follow-up question to that revenue growth, you mentioned that the Lockheed Martin contract was still ongoing, but you also mentioned other corporate customers. Maybe if you can just shed a little bit more light on that. Is it from a military perspective or is it going into commercial customers? If you could just provide a little bit of color with that. Thank you. Yeah. Hey, Jim. Typically, we look to quickly roll these into the divisions. You've heard me say before, we really don't get into legacy or organic versus inorganic just because of how it can be. This case, it was a larger transaction, so it is a little bit easier. We will have it part of Lightwave. It will roll up into Lightwave. I can tell you for now what it made the impact. I believe the organic side of Lightwave is around 12%-13%, somewhere in that range organically. The big increase happens from rolling in OptaSense into that. What was the other part? The commercial. Yeah, go ahead. Sure. Yeah. The deliveries to Lockheed Martin have gone very well here in Q1, as we mentioned. In terms of other customers, we did have several, on the order of half dozen or so new wins with other defense-related customers or activities. That would be for other either airframe measurements or in this case, we had a win for measuring on submarine application. New product. It takes time to build that customer base up, but that's right on track with what we expect is to be bringing on these new customers on a pretty consistent basis on the defense application side. We also had, as we mentioned in the script, a couple of really nice wins for data center testing. We mentioned in the past that this product has applications in the data center with measuring latency in particular, which is the delay measurement, which is critical for financial data centers. We had several wins on that front as well, which is more on the commercial side rather than the defense side. It was a nice start to the year for that new product. Okay, great. Thank you. Just one other question in regards to the adjusted EBITDA. You guys recorded $2.1, but you're reaffirming guidance from $16 million-$19 million. I'm assuming that guidance is based on having a strong second half to 2021 based on a 55% leap to business in the second half. That's correct. Yeah. All right. It's still being reaffirmed. There's really no other risk in regards to hitting those numbers. [crosstalk] Yeah. Jim, the way that we approach this, it doesn't do us any good to get out ahead of ourselves. When we give guidance, it's what we see in front of us. All I can do in all these times, be transparent with everyone and lay out what I see in front of us. I think when you look historically, if you look the last five, six years, 44%-46% of our revenue comes in the first half of the year, and then the remainder in the second half. Right now, with what we see and the bookings that we've seen in Q1 and what we're seeing halfway through Q2, it has us very confidently reaffirming the guidance both on the top, on the revenue side, and on that adjusted EBITDA. Because of the different things that we're looking at, the acquisitive things, we guide on the adjusted EBITDA on the bottom. We feel good about with what we see today and what's in front of us reaffirming that guidance that we gave back last quarter. All right. Fair enough. Thank you very much. Yeah. Thanks, Jim. All right, next. Our next question is from Robert Silveira of R.E. Silveira & Associates. Your line is open. Thank you. Gentlemen, well done in difficult time frames. I noticed that the diluted share number has climbed by just over 800,000 year-over-year. I was wondering, is that share number climbing because of stock-based compensation or f rom what else? No, it's from stock-based compensation. Okay. Is that the exercising of options? I think there's exercising of options. I think there's incentivizing senior management. When we do the acquisition with OptaSense, we want to make sure that everyone is simpatico with all of us and making sure that we buy. Yeah, tying our performance to performance stock units. Yeah. Also, because you're referring to diluted, when they're issued, and we do the dilution calculation, they get added in there as if they were issued. Right. Okay. The other thing I had is a question on the debt that you have. Do you have any intentions of trying to accelerate debt reduction? Not on the term. We have two pieces, and the term is three years with four quarterly payments each year. We're planning to pay that off roughly $1 million a quarter. The revolver, what we'll do is we'll pay that down if we think that's the best use of our cash. We do plan, if that's the case, that we would pay the revolver down, but not the term. Yeah. If the revolver stands out there at $7.5 available, $7.5 drawn right now, there's no reason not to use excess cash to pay that down and knowing that it's always there on your availability. No one here is big on paying interest just to pay interest. I think we'll probably use that as a fluctuation of excess cash. I like that idea. Okay. Thank you very much, gentlemen. Well done. Keep going. I appreciate it. [crosstalk] Our next question is from Dave Kang of B. Riley. Your line is open. Thank you. Good afternoon. My first question is actually a clarification. Regarding Luna Labs, you talked about COVID impact. Can you kind of quantify, is it about $1 million or so? James, I don't know whether you quantify. You can talk about it, and I know there's contracts that we were planning on as we sit here and do forecasts and budgets, that was going to happen in Q1. Some of the labs that we were dealing with, some of the customers we were dealing with, saw a spike coming out of the holidays that trickled into Q1, and it's certainly a number. I don't know what we were flashing at the beginning of the year, but I would bet it's a number. It's $500,000 - $1 million that was pushed out of Q1 into Q2 and further. Is that fair, James, somewhere in that range? I think that's the right ballpark. Like Scott said, we're down about 5% year-over-year from Q1 of last year. I don't think it's much bigger than that. I think that's the order of magnitude that we're talking about. We probably would've seen growth over last year. That's typical for us to be growing year-over-year compared to the same quarter last year. For us to be down this year is unusual, as Scott said earlier. Something in the $500,000-$1 million range is probably about the right range. Like we said earlier, it's more of a timing issue. That revenue's not really lost. It's more delayed through the rest of the year. We expect to pick it up. Yeah, I think you'll see a different story in Q2 with Luna Labs, Dave. Got it. Certainly, a lot of comm equipment companies, they've been talking about supply chain constraints because of chip shortages. Were you impacted, or do you expect to be impacted during the upcoming quarters? Hey, Dave, this is Brian. We don't expect to be impacted in a material way. We've been managing that very closely. We've talked about it every quarter now for three or four in a row, I think. We certainly have seen lead times grow and delays. For the size of our business and for what we consume and what we need, we've been able to manage through those delays and garner more inventory where needed, and put emergency buffers in place. We've been able to manage through it, and so we don't anticipate that it's going to have a big impact, but something we're keeping a very close eye on. Got it. Regarding Lightwave, you said our comm test was strong. Any particular areas that you can point to where you saw strength? Well, we started the year with some deliveries for the OBR 6200 platform for Lockheed Martin, and we've talked a lot about that on our last couple of calls. That was a nice driver. We had a nice large order at the end of last year and that drove revenue this year. The good news was, as Scott mentioned, bookings were strong, book-to-bill was good. The commercial sector, I think we specifically mentioned in the comments, was strong in Q1, and we had a really nice order flow for communication systems providers. For our test equipment driving volume on their sides and build-outs for their manufacturing using our equipment. Which is part of our growth strategy, is to get our equipment more into manufacturing type applications, and we saw that in Q1 start to pick up on the commercial side. Got it. My last question is regarding OptaSense. I think that you said last year, oil and gas verticals, they under-spent because of the pandemic. Have we seen any kind of signs of improvement from those verticals? Yeah. Q1 was a very interesting quarter. OptaSense, the business unit, had a good strong performance. It was not particularly driven by oil and gas in Q1 per se. With the price of oil reaching in Q1 $65 or so, what we're seeing now already in Q2 was a really strong start to that segment in April, and we're seeing that carry over into May. We had good performance in Q1 with a little bit of a lag in the oil and gas side of the equation, and that's picking up now in Q2. That'll add to what was already kind of a good start to the year. Got it. Thank you. Thanks, Dave. As a reminder, to ask a question, please press star one on your telephone keypad. Again, in order to ask a question, please press star one. Our next question is from Tim Savageaux of Northland Capital Markets. Your line is open. Good afternoon. Just wanted to focus back in on the commentary on strong bookings. I think you gave a little bit more color there on equipment manufacturers and mentioned data center earlier as well as being drivers organically. My question is, does that commentary include OptaSense on a comparable basis in terms of record bookings for the company? Is there a comparability issue there? Yeah. I'll let Brian talk about that, Tim, but yeah, it does. Keep in mind of the business model that they have, in many ways, you book the business and you have to go out into the field to do some installation and things like that. You are at the mercy of the customer being available to be out in the field to be there. You kind of need them as part of the process. When I mentioned the very strong bookings in Q1, I was including OptaSense, and Brian, you can talk about that as well. Yeah. The bookings numbers do include OptaSense, but even without, the order flow was very strong in Q1, and the book-to-bill was very good. Historically, Q1 is our lowest quarter from a bookings and revenue perspective, but we actually had a very strong Q1 from a bookings perspective. I think that's the way to look at it. As I said, the commercial side relative to last year, where in those spaces, Tim, as you mentioned, the communications and data centers, we actually had a good year. Commercial was okay, but military defense type spending was actually stronger. This year, we had, I think our best Q1 ever on an apples-to-apples basis for bookings of that type of equipment in that segment by a fair amount. It was a really good start to the year. Okay. Great. If I could just follow-up on that particular comment. You mentioned, well, I don't know if there's some easier compares here or what have you, but is it safe to say that on the commercial communication side, revenues were not only up year-over-year, but orders and bookings came in stronger than you would've expected at the beginning of the quarter? I think that's a fair assessment. Yep. The order book was very good, as I said, and the commercial element was a strong driver. A lot of work in silicon photonics and semiconductor photonic applications, and a number of other really nice applications as well outside of that specific area. Then, as I already mentioned, the portable handheld product we introduced at the end of last year and have talked about for Lockheed Martin also had some nice new wins in Q1. That all added up to a good start to the year. Great. Got it. Thanks very much. Thanks, Tim. As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, press the pound key. Again, to ask a question, please press star one. There are no further questions on queue. I would now like to turn the call over to Scott for final comments. All right. Well, thank you everyone for joining us today. You've heard me say repeatedly that we believe we are on the right path with the right vision. We continue to believe in our potential and that we're on the right side of a market shift in trends towards lightweighting and 5G. In fact, our capabilities can help to accelerate those trends. That's why we're investing heavily in our business and are also very focused on making sure that we have the right leaders and bench strength in place. Feel free to reach out to myself, Gene, Allison, James, or Brian with any questions that you may have, and I look forward to speaking with you guys soon. Thank you for your time and interest in Luna Innovations. Now, Lori, I'm going to turn it back to you to end the call. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation, and have a wonderful day. You may all disconnect.