Good day, ladies and gentlemen. Welcome to the Maxeon Solar Technologies third quarter 2022 earnings call. Currently, all participants are in listen only mode. Later, we will conduct a question and answer session, and instructions will follow at that time. As a reminder, this conference call is being recorded. I would now like to turn the conference over to our host, Mr. Robert Lahey of Maxeon Solar Technologies. Sir, you may begin. Thank you, operator. Good day, everyone, and welcome to Maxeon's third quarter 2022 earnings conference call. With us today are Interim Chief Executive Officer, Mark Babcock, Chief Financial Officer, Kai Strohbecke, and Chief Strategy Officer, Peter Aschenbrenner. Let me cover a few housekeeping items before I turn the call over to Mark. As a reminder, a replay of this call will be available later today on the investor relations page of Maxeon's website. During today's call, we will make forward-looking statements that are subject to various risks and uncertainties that are described in the Safe Harbor slide of today's presentation, today's press release, the Form 6-K, and other SEC filings. Please see those documents for additional information regarding those factors that may affect these forward-looking statements. To enhance this call, we have also posted a supplemental slide deck on the events and presentations page of Maxeon's investor relations website. Also, we will reference certain non-GAAP measures during today's call. Please refer to the appendix of our supplemental slide deck, as well as today's earnings press release, both of which are available on Maxeon's investor relations website for a presentation of the most directly comparable GAAP measure, as well as the relevant GAAP to non-GAAP reconciliations. With that, let me turn the call over to Maxeon's CEO, Mark Babcock. Thank you, Rob, and good day, everyone. I was appointed Interim CEO of Maxeon in September when our board and Jeff Waters made the mutual decision to transition to new leadership. We are very thankful for Jeff's nearly four years of service to the company, during which we successfully spun out of SunPower, refreshed the majority of our manufacturing fleet, launched our Beyond the Panel initiative, and commenced shipping our first Performance line product into the United States. As we look forward to the next four years, we expect our focus to be primarily on panel manufacturing capacity growth, expansion of our footprint in the U.S. market, and increasingly material contributions from our Beyond the Panel initiatives. The board's search for a new CEO is well underway, and in the meantime, it's a privilege for me to serve the company during the transition. With that said, I'll now provide a detailed update on Maxeon's key transformation initiatives and progress toward achievement of our long-term financial model. Then Kai will review our financial performance and outlook, and we'll conclude with Q&A. Now let's talk about progress of our business, starting with distributed generation. We were thrilled to formally launch our U.S. channel expansion initiative at the RE+ conference in September. Our largest DG customer, SunPower, had a significant presence there and expressed strong interest in our products for 2023 and beyond. While this partnership has evolved since the spin-out, their relationship remains mutually beneficial, and we look forward to continuing to be a key supplier to SunPower well into the future. We also began booking our first sales of Maxeon branded products destined for the DG market through a new partnership with Greentech Renewables, previously known as CED Greentech. This new channel is busy selling systems for delivery starting in January. Feedback from new installer customers was excellent, with many noting the value and differentiation of our 40-year warranty. As demand for premium solar products increases and the number of alternative suppliers decreases, we believe this new partnership should deliver material market share expansion in 2023 and beyond. Maxeon will also cultivate touch points with installers and end customers via our new channel program. By moving closer to end customers in the U.S., we expect to drive ASP expansion beyond our current global average. ASPs are also increasing materially in core E.U. markets like France and the Netherlands, where modules integrated with power electronics accounted for more than 60% of sales in the third quarter. Beyond the Panel revenue also grew sequentially in Belgium, Germany, Italy, the U.K. and Australia. Our channel partners are preparing to integrate storage, which starts shipping next quarter, as well as our new EV charging products. We're making our installers' lives easier by shipping pre-integrated systems from a single source and providing a point of differentiation for their sales professionals to increase close rates at the kitchen table. We believe Maxeon is uniquely positioned for success in this portion of the downstream value chain by virtue of our channel structure, respected brand, and unique and differentiated solar panels. The initial results are very encouraging, and we believe we're just starting to scratch the surface of this opportunity. Overall, DG sales in Q3 were up 25% year-over-year as we benefited from additional price increases and a higher mix of our Maxeon 6 product, which has now replaced all of our previous Maxeon 5 capacity. Europe set new volume and revenue records for the sixth consecutive quarter. We were particularly pleased with our business results in France, where we crossed the 60% threshold for AC Module mix and increased our residential market share to north of 20% in the third quarter, up from mid-teens in 2021. Beyond the Panel, contributions were also strong in Australia, where AC Module mix increased to approximately 40% and where we began booking orders for storage product sales with delivery scheduled for Q1. We continue to maximize global DG profits by leveraging supply of our Performance line products in certain markets and redirecting IBC volume to our highest ASP segments, such as the residential markets in the U.S. and European Union. We plan to continue this margin optimization strategy in 2023, and expect to liberate a significant amount of Maxeon 3 supply to support sales into our new U.S. residential channel. The strength of demand in both the U.S. and EU has led us to reassess the deployment plan for Maxeon 7. Our seventh generation IBC technology is based on a novel cell architecture that we expect will yield roughly 100 basis points higher efficiency compared with our current IBC technology, as well as other unique and important performance attributes. This translates to a 25% energy yield advantage compared to standard efficiency modules in the first year, and is amplified over time due to slower degradation and longer warranted lifetime. We believe this product is ideal for the U.S. and EU residential markets, where increasing electricity demand from EV and heat pump adoption is constrained by limited roof spaces. Given the unique value proposition of Maxeon 7 and the exceptional demand environment, we are evaluating strategies to expand Maxeon 7 capacity instead of retrofitting existing lines. This approach will maintain full output from our Maxeon 3 production to meet the high levels of anticipated demand in 2023. Detailed engineering studies are ongoing, and we will provide CapEx and ramp timing information at a later date. In our utility scale business, we've ramped our Performance line capacity to just over 1 GW and are on track to achieve the full 1.8 GW of capacity in 2023. The ramp of our U.S.-focused capacity is timely, with extremely high appetite for solar panels from U.S. utility scale customers. Our discussions at the RE+ conference validated what we have heard from several third-party sources around an approximate doubling of U.S. utility scale demand over the next few years due to the impact of the recent extension and enhancement of the Investment Tax Credits. With a multi-gigawatt pipeline fully allocated through 2025, our sales team is now in active discussions for supply agreements with delivery dates into 2028. As we assess our opportunities in U.S. utility scale business, we are highly focused on maximizing the advantage of our unique market position. With that in mind, I'd like to share an update on our plans for domestic manufacturing. Developments in the macro geopolitical landscape and recent passage of the Inflation Reduction Act have put in place conditions that support exciting growth prospects for Maxeon. We plan to capitalize on this opportunity with a new 3 GW solar cell and module factory located in the southeastern United States. Our unique technology and tailored supply chain is in high demand with customers, and we're moving rapidly to secure long-term supply arrangements that ensure healthy margins for Maxeon while providing certainty of supply for our customers. We anticipate ramping in 2025, subject to completion of financing through the Department of Energy Loan Guarantee Program. The next step in this process is an invitation to due diligence and a negotiation of a term sheet, which, if successful, would lead to a conditional commitment. We continue working closely with the DOE team to move the process forward and expect an invitation soon. With a total projected investment of over $1 billion, this factory is currently planned to generate over 2,000 manufacturing jobs and enable long-term, predictable supply of locally produced solar panels to our customers. It's an exciting time at Maxeon. We've done some heavy lifting during the past two years, ramping Maxeon 6, developing Maxeon 7, launching Beyond the Panel, and expanding into U.S. utility-scale. These efforts are finally starting to show the expected results as we improve from our second quarter 2022 margin trough toward achievement of our long-term financial model next year. While we are now accelerating our 2024 to 2026 growth initiatives, we're still laser-focused on executing the final steps in our transformation to profitability in 2023. With that, I'll turn the call over to Kai. Thank you, Mark, and hello, everyone. I will discuss the drivers and details of last quarter's performance and then provide guidance for the current quarter. Total shipments for the third quarter were 605 megawatts, consistent with our guidance range of 580-620 megawatts. This represents a 16% sequential increase attributable largely to our first full quarter of U.S. utility scale shipments from our North American ModCo that is still ramping up its capacity. DG volumes were also up sequentially, led by increased volumes of Maxeon 6 from recently converted capacity in Fab 3. Revenues for the third quarter were $275 million, also consistent with our guidance range and representing a 16% sequential increase. DG ASPs were up in many geographies due to a combination of price increases and a higher mix of Beyond the Panel revenue. However, total blended ASP was diluted by a higher mix of utility scale volume as well as some opportunistic cell sales. Non-GAAP gross income in the third quarter was negative $16 million, in line with our guidance of negative $10 million-$20 million, and an improvement of $8 million from our second quarter results, which we have earlier identified as the trough in our multi-year transformation. The sequential improvement reflects the higher mix of our flagship Maxeon 6 panels, a higher mix of Beyond the Panel products, and geographic optimization strategies in DG. Third quarter cost of goods sold includes $1 million of out-of-market polysilicon charges related to our legacy supply contract. This figure is now significantly smaller than historical levels, as polysilicon prices in the market have come very close to our fixed contract price. The year-over-year impact of supply chain cost inflation on our cost of goods sold was $17 million. This was more than offset by $26 million of ASP increases. As previously projected, supply chain cost increases have been slowing down or even started reversing in some cases, while we continued to increase our prices in DG markets based on the strong demand. As a result, our DG business was meaningfully gross margin positive in the third quarter. Our gross loss is attributable to our new U.S. utility scale business, where we are still seeing underutilization in our partially rented facilities and other startup expenses that impact costs, as well as below-market ASPs from our first half 2021 bookings. Manufacturing volume of our Malaysian Performance line cell fab and North American ModCo increased materially during the quarter, but were both still well below the target capacity that we plan to reach in 2023. This contributed the majority of the overall Maxeon level underutilization charges totaling $10 million in the quarter. In the third quarter, we also recognized $16.8 million in additional lower of cost or market write-downs on Performance line inventories. Non-GAAP operating expenses were $35 million in the third quarter, in line with our guidance. Adjusted EBITDA in the third quarter was -$35 million, which is improved from the second quarter and within our guidance range. GAAP net loss came in at $45 million compared to $88 million in the previous quarter. Moving on to the balance sheet. We closed the third quarter with cash equivalents, restricted cash, and short-term investments of $314 million compared to $180 million at the end of the second quarter. The sequential increase was driven by our $207 million convertible bond issuance, partially offset by CapEx spending, operating losses, and higher inventories as we ramp deliveries into our end markets for further growth. DIO increased sequentially from 89 days to 91 days. Capital expenditures in the third quarter were $16 million, which was below our guidance range of $21 million-$25 million, as we maintain payment discipline while continuing to spend our earmarked CapEx on Maxeon 6 and Performance line capacity for the U.S. Overall, we are pleased to have executed in the third quarter in line with our plan, improved our financial performance from our margin trough in the second quarter, and positioned the company to deliver positive gross margins in the fourth quarter. This performance was a result of previous investments in DG that are now starting to show tangible results and still reflects the burden of a ramping U.S. utility scale business with legacy ASPs. We expect to see sequentially improving quarterly performance over the course of the next year, leading up to the achievement of our long-term financial model with gross margins of at least 15% before the end of 2023. We expect to achieve this financial turnaround based partly on the already contracted utility scale prices in the second half of 2023, utility scale cost reduction as our factories become fully ramped, strong DG pricing in the U.S. and E.U., and an increased mix of Beyond the Panel revenue. With these points in mind, I'll now turn to our expectations for the fourth quarter of 2022. We project fourth quarter shipments of between 680 and 720 MW. The midpoint of this guidance represents a 16% sequential volume growth. The largest growth driver will be U.S. utility scale volumes, which we expect to continue in 2023 until our facilities reach full ramp. We project revenue of $290 million-$330 million. The midpoint of these numbers and of our shipment guidance imply a slight ASP decrease sequentially, which is attributable to a higher mix of utility scale shipments. DG ASPs are expected to increase slightly on higher panel prices and the greater mix of Beyond the Panel revenue. Non-GAAP gross profit is expected to be in the range of breakeven to $10 million. The largest contributor in expected sequential improvement is unit cost reduction on Performance line as we ramp capacity. Included in gross margin guidance is a $1 million charge for out-of-market polysilicon. This contract is expiring soon, but the P&L impact will continue into early 2023 as we sell products that incorporate this raw material. Non-GAAP operating expenses in the fourth quarter are projected to be $36 million ± $2 million, slightly up from third quarter levels. However, as a percentage of revenue, our OpEx is expected to become more efficient both in the fourth quarter and into 2023. As just one example, our sales of power electronics, storage, and EV chargers will be executed largely by the same DG sales and logistics teams that handle our panel sales. Non-GAAP EBITDA is projected to be in the range of -$17 million to -$27 million, demonstrating sequential improvement in line with gross income. Capital expenditures are projected to be in the range of $16-$20 million. The majority of this spend is for our Performance line ramp. In 2023, we will continue to spend CapEx for completing the ramp of our Performance line capacity for the U.S. market. We intend to finance this CapEx from our recent $207 million convert issuance. As Mark discussed, we are working on a plan for Maxeon 7 capacity expansion, and because of that, our previous CapEx indication for retrofitting Maxeon 3 production lines is no longer relevant. Furthermore, we anticipate that spending for our proposed 3 GW facility in the U.S. may commence in 2023. Our financing plan remains contingent on a successful application with the U.S. Department of Energy loan guarantee program for a majority of the CapEx. For the remaining funds required, we will consider options including customer co-investment, strategic partnerships, company EBITDA generation, and the capital markets. Interest in this project remains very high from a variety of different stakeholders. We will finalize a financing strategy over the next several months that we believe will be in the best interest of Maxeon shareholders. With that, I turn the call back to Mark to summarize before we go to Q&A. Thank you, Kai. We're primarily focused on three critical projects. First, completion of our capacity transformation, which is a key element of achieving our long-term financial model. Second, we're leaning into demand opportunities with planned manufacturing capacity expansion. Third, we're scaling and expanding Beyond the Panel product sales to become a material and transformative portion of our DG business. Now let's go to Q&A. Operator, please proceed. Thank you. To ask a question, you will need to press star one one on your telephone. Please stand by while we compile the Q&A roster. Our first question comes from the line of Julien Dumoulin-Smith with Bank of America. Your line is now open. Hey, Good afternoon, team. Thank you very much for the time. Congratulations on the results here. If I may, just to follow up on the positive margin commentary here, can you talk a little bit more about the ramp through 2022 here, just as you see those legacy ASPs rolling off that you alluded to in your prepared remarks, as well as the ramp here, as well as some of the the underutilization. You commented in the remarks about, you know, demand all the way out through 2028 versus underutilization still in a real-time way. Can you talk about sort of the ability to fill volume and then also ultimately some of those other considerations here into the back half? Yeah. I'll start, and then I might let Kai finish up here. In general, as we said, we see demand in that U.S. utility space being very strong. We are booking out several years in advance and in active discussions with folks for volumes out there. In the short term, it's really a matter of as we ramp up the facilities, we're not utilizing all of the capacity yet. If we look through into next year, there's three big components of how we get to the long-term financial model. One of those is moving through and past the lower contracted prices that we have from sort of the earlier signed contracts, where contracts for delivery in the second half of next year are at significantly higher ASPs than those for delivery this year and at the start of next year. The second piece is the COGS assumptions in terms of both an improvement in overall COGS for that space, as well as the underutilization basically disappearing as we move into much closer to full capacity production. The last piece is a combination of other things, including optimization of ASPs in the DG space, and some other areas there. I think the other thing that'll come in next year is we expect a real contribution from our additional Beyond the Panel products. We talked a little bit here about the contribution from the microinverter products, but we will begin shipping the storage product in Australia in Q1. We're already taking orders for that. We should start shipping the storage product in Q2 in Europe, and that's gonna provide some significant uplift there. It's really a combination of those things that gets us on that trajectory. I don't know, Kai, did you have anything to add? Yeah, I just wanna fill in a few things. Hi, Julien. With regards to the underutilization, as Mark mentioned, the underutilization is purely operational and not due to a lack of demand. We are certainly not suffering from a lack of demand. Underutilization charges have peaked in the second quarter at around $14 million. We just reported about $10 million for this quarter, and then we expect it to go further down from here over the coming quarters. The nature of that is just that we have fixed costs for our building clean room facilities, some equipment that we have already installed and where we are ramping the additional capacity into these, the additional volumes into this capacity. This is how, as we are ramping, that underutilization gets less and less over time. Got it. Excellent. If I could just clarify here, as you presumably see some more drag from those out-of-market utility scale contracts in early 2023, how should we think about the cadence of margins? You talk about positive here. Does it not look like IBC price increases have hit just yet? As you say, the Beyond the Panel is still ramping. How do we pair those two trends, right, higher DG, especially the ASPs with Greentech, presumably more utility scale drag, at least in the first half, if we can try to be more specific, if you don't mind. I think, you know, we will start selling to Greentech in January. I think that's something that kicks in almost immediately. Although the volumes will not be, you know, flat throughout the year, they'll be ramping during the year as we build that business. The contribution from those ASPs would also build during the year. As I think I said earlier, the contracts for the first half of the year are not at exceptionally favorable ASPs in the utility space, but those get significantly better in the second half of the year. It won't be exactly a linear ramp, but it will be a ramp through the year, where, as we said, during 2023, we expect to get to our long-term financial model. Yeah. Julien, as you draw a line between the fourth quarter of 2022, where we are targeting to be gross margin break even to a 15% gross margin in 2023 in accordance with our long-term financial model, we still have some runway in DG, as Mark said, from already in the third quarter, meaningfully positive gross margins. I would say the majority of that improvement would come from the improvements in the US Performance Series that Mark talked about. Yeah. Still on track, if not accelerating the 12% adjusted EBIT margin? Yes. That's also in line with our long-term financial model. We take the 15% gross margin as a proxy for the whole long-term financial model, which also includes 12% adjusted EBITDA margin. Okay. Thank you, guys. Appreciate it. Thanks, Julien. Thank you. Our next question comes from the line of Donovan Schafer with Northland Capital Markets. Your line is now open. Hey, guys, thanks for taking the questions. My first question, actually, I'm curious. I just, you know, I kind of track and follow all the news, and sometimes there's kind of, you know, press releases that might be more promotional from a company than necessarily means something super material. I've noticed some IBC related announcements from other companies. There's a German company called ISC Konstanz. It's spelled like K and it's the Z, ISC Konstanz. I think there was also maybe a Chinese company. I'm kind of blanking on the name, and then it's a little bit cloudy in my mind, but I feel like there were some other ones I saw talking specifically about either IBC or maybe some other sort of form of back contact. Of course, I know, you know, Panasonic and LG, you know, they left the IBC market or walked away from their offerings because of the patents you guys have, and how they had to do, you know, additional process steps and everything that basically made it uneconomic for them. With some of these other just, you know, press releases or announcements or interviews or whatever it is I was seeing, can you give us sort of an update on kind of the IBC market and technology more generally, and I guess maybe your patents, when any of that expires, sort of what geographies, you know, maybe this German company is doing it because they, you know, they're in a better patent position in that geography, but maybe not the U.S. Just kind of those sort of specifics around technology patent, you know, trend of that versus TOPCon and other architectures. Any updates there would just be really helpful, 'cause I know you have an advantage there, and you've got good patents, but again, like I said, I think I sort of qualitatively feel like I saw a little bit of an uptake and just some other names saying, "Hey, we're gonna do an IBC thing. Okay. Don, this is Peter Aschenbrenner. I'll try to be pretty succinct. We feel extremely good about our patent protection. We've been Innovating and building our IP portfolio, you know, for 35 years. We continue to not only file patents on fundamental innovations like some of the architecture around our Maxeon 7 cell, but also some really disruptive metallization ideas. It's not really a question of things rolling off. I think it's a question of ongoing innovation. Strong IP still in place, and we tend to file in place in markets where we're gonna cover the vast majority of our sales, so EU, US, China. Okay Some countries in Southeast Asia. We feel good about patent protection. There are always folks, I would say sort of getting in and getting out of IBC. You mentioned a few of them. The institute in Konstanz is an R&D outfit. They're one of the institutes that's been looking at IBC for a long period of time, or back contact, I should say. It's important to note that the way we do back contact cells with the interdigitated metallization on the back, that's why we call it IBC, is one of the things that we have very good patent protection on. Most other people that have done back contact cells have used different types of metallization, which is a little more cumbersome. I would say there's an ongoing level of interest in this structure. We believe it's, as we said consistently over the past 15 years, we think it's kind of the entitled form of a crystalline silicon solar cell. We're still working towards that, and we're starting to see other people get interested as well, particularly as they start to get some experience on passivated contacts, which, you know, really are something we've been doing again for 35 years. They're getting that experience through their TOPCon technology. I would say stay tuned. We feel good about the lead we have. I think we'll continue to see some folks develop products that are kind of maybe adjacent to our approach, but certainly not as mature. I guess, kind of that raises the flip side of it. Do you think some of that, like the Konstanz and, you know, the other ones I've seen, is that maybe more indicative? Are you seeing any kind of a trend or, like you're saying, being the ideal form that maybe some other companies are coming around? Yeah, this idea that IBC is actually a more optimal or ideal, you know, there's like, you know, there's a bunch of different architectures kind of out there competing and, you know, tandem layering and, you know, all this stuff. Is it reflective of kind of more of a trend there, or is it just more these ebbs and flows that you talked about where companies kind of just come and go from IBC, and you're the one that kind of tends to stick around? I think it's too early to call it a trend. I think that the clear trend right now is towards TOPCon in terms of the mainstream market. I think there has consistently been and remains interest in IBC as a longer term mainstream technology. Right now, most of the action is in TOPCon. Okay. Industry-wide. If I can get another one in, I wanna ask about, you know, the Uyghur Forced Labor Prevention Act. I apologize if you did cover any of this. I was kind of jumping between, you know, this and another call. I know you guys have been able to, you know, there's the P-Series cells out of Mexico, panels actually, that you're assembling there. Those, last I checked, you know, there was no issue, you know, every day you had trucks basically going back and forth between the U.S. and Mexico border. Obviously no issues, again, last time I checked, getting into the U.S. Just wanna make sure that that's sort of still the case. You know, clearly, as you said, you're talking about conversations, bookings out to 2028, there may not be room for you to kind of cash in on an incremental interest, but maybe that ties into expansion in the U.S. Like, just curious if that ability to have trucks coming back and forth across the border every day, if customers look at that and say, "Hmm, okay, we can get really comfortable behind these panels," that increases our interest, that increases these conversations. Kind of the same thing on the IBC side, 'cause that I know there's a technology exemption, but I don't think that would apply to that. That was more ADCVD. With the Uyghur Forced Labor, you know, you get the poly from Hemlock, but also that, you know, that's going away. Just curious on the forced labor prevention stuff, you know, just getting product into the U.S., any kind of updates, developments there? Sure. On the, well, I think with respect to issues around forced labor and, you know, blockages at the border, I think our customers feel comfortable with the supply chain we have in place now. As you said, you know, we're shipping hundreds of shipments a month and have been. It's a very different type of supply chain from what most companies are delivering here into the U.S. We think that is solid and, you know, we will look to continue that and potentially expand it. With respect to manufacturing in the U.S., that kind of takes most of those issues off the table by definition. On the IBC front, the exclusion is a Section 201 exclusion, which is slated to go away in a few years. We don't anticipate any issues related to our IBC product being shipped into the U.S. in the future either. Okay, great. Thanks. That's helpful. I'll take the rest of my questions offline. Thanks, guys. Thank you. Thank you. Our next question comes from the line of Brian Lee with Goldman Sachs. Your line is now open. Hey, guys. Good afternoon. Thanks for taking the questions. I'll try to keep them quick. I just had two more numbers related. On the $1 billion of CapEx, can you give us a sense of how that's gonna be phased in over the next, you know, couple years? You know, how much we should be thinking in 2023, and then in 2024? On the DOE loan guarantee, just, I think you've, you know, quantified it in the past for us, but can you give us a sense of how much you are reasonably anticipating to get from the DOE, and then what would be your kind of net burden? Sure. Brian, this is Peter. I'll take those. First of all, roughly $1 billion number that we disclosed today is a total project investment. That's not the CapEx per se. CapEx, of course, is an important part of that. That includes facility contingency, lease costs over the period of the project, et cetera. It's the way that the DOE sort of calculates a total project cost. We haven't disclosed specific timing for this project. I think you'd assume that, you know, if the plant's coming online in mid-2025, you'd assume that a lot of that CapEx is spent prior to that. With respect to the DOE percentage, we haven't mentioned a specific percentage yet. Of course, we would like that percentage to be at a negotiated number. We'd like that to be as high as possible. There are some precedents out there that you can look at. What we have said is that we expect the vast majority of investment in this project to come from a combination of the DOE and from customer co-investment. Okay, that's great. Appreciate that additional color. Just follow up from me on. I think we saw a filing from one of your largest shareholders as well as maybe you guys put something out this evening as well. Can you speak to TotalEnergies selling their stake, it seems like over the next 12 months? I know they've been a strategic investor partner for a number of years, even back to the SunPower days. Anything to read into that? Just maybe give us a little bit more background on what's going on there. Thank you. Yeah. We obviously can't speak for TotalEnergies. However, if you observe their actions over the past years, they have become significantly more active in the large scale generation asset ownership space, and that really appears to be their focus there. Not especially surprising that since we are much more upstream on the large scale side, we do have obviously the downstream, some good downstream exposure in DG, but that we understand why it would potentially not fit with their current investment objectives. Not especially surprising given where TotalEnergies's focus appears to be. You know, if you really wanna get the story on what they're doing, you'd obviously have to ask them. All right. Fair enough. Appreciate it. Thanks, guys. Thanks. Thank you. Our next question comes from the line of Philip Shen with ROTH Capital Partners. Your line is now open. Hey, guys. Thanks for the questions. Wanted to follow up on some of Brian's questions on the DOE and the 3 GW facility. The $1 billion is the total investment. Can you share what the CapEx is? If so, you know, actually, regardless of whether or not you can or can't, can you talk about what you expect your CapEx in 2023 to be? Thanks. Hey. Hey, Phil, this is Kai. We're not in a position right now to further break down the CapEx. There's you know different gives and takes and decisions still to be made and what technically kind of will qualify as CapEx. We're putting that number out there that it's a total investment of roughly $1 billion right now, and that's all that we're disclosing at this point. With regards to 2023 CapEx also here, we are not giving CapEx guidance right now for 2023. We'll do that in the next earnings call in early 2023. There will be some spillover from some of the CapEx that we originally had in our guidance for this year. You have seen that we spend about $56 million of CapEx till the end of the September quarter. We are now guiding at the midpoint for about another $18 million. That puts you into the $74 million range. We had guided originally $85-$90 million. There's gonna be some spillover, just some finishing up of some of the existing projects, some milestone payments for equipment that has already been installed and is reaching specifications. Beyond that, we are not giving further CapEx guidance for 2023 at this point. Okay. Thanks, Kai. In terms of the customer co-investment, you guys talked about that as a meaningful source of funds. Can you talk through how that might be structured? Would they invest in an equity piece of the 3 GW facility, or would it be, you know, just the large deposits that they give for a long term, you know, maybe three-year contract? What are the different scenarios that you guys are playing with? Also, can you talk about the risk that the facility could be delayed beyond 2025? We're hearing that the transformers, you know, just a couple of months ago, they were two years out in terms of lead time, and now they may be as much as three years out in terms of lead time, given, you know, you have the CHIPS bill and then the IRA, and, you know, a lot of people are trying to access transformers now. What are your thoughts on the risk around that 25 number as well or timing? Thanks. The two questions. First question is on the form of customer co-investment, and second question on schedule risk. This is Peter, Phil. With respect to a customer co-investment, we're still evaluating a couple different models. I would say the plan A model would be a prepayment or a loan that would be repayable at some point into the project offtake. There's interest in other forms of investment also. I think as we get further into the due diligence process, that's when we'll probably make final decisions on co-investment structure. With respect to facility schedule risk, I think you make a good point that we're not the only ones trying to build a facility like this in the U.S. Having said that, we've been at this now for about a year in terms of planning and detailed engineering. I think we have a pretty good handle. I feel like we have a pretty good handle on key equipment delivery, and a lot of that is somewhat site dependent as well. I think we're confident in our ramp time currently. Thanks for the color. Shifting gears to your relationship with SunPower. Think about how much you might end up supplying to SunPower in 2022. Do you think your megawatts in 2023 might be up or down versus what you shipped to them in 2022? I think that would probably be slightly down, but not significantly down, in 2023. That would again be part of the margin optimization that we spoke about earlier. We have a good relationship with SunPower. We've been working with them for a long time. They've been selling our product for a long time. It's really a matter of discussions ongoing with them for, as I think they mentioned on their call, we've actually supplied more than contracted in 2022. There's some potential to supply more in 2023. It's a lot of demand out there, and SunPower is a great partner. It wouldn't be a significant reduction if there is a reduction. Really appreciate that color, Mark. Finally, in terms of the CEO process, Mark, your interim, you know, the shift or change was a bit of a surprise, I think, for everyone. Where are we in the process? When do you think? What's the timing in terms of finalizing a new CEO and do you have your name in the hat? I don't think we have a specific timeline set that we're disclosing. The process is ongoing, and we are engaged with a recruiting headhunter to work on that, obviously. It's something that's going on at the board level. It's yeah, I guess I'm here for as long as I need to be here. I feel like we're making good progress until such time as we do have a permanent CEO. It's actually not, I think, the main concern, at least to the management team, in terms of how we execute for 2023. Great. Thanks again, Mark. I'll pass it on. Thank you. Our next question comes from the line of Pavel Molchanov with Raymond James. Your line is now open. Thanks for taking the question. You mentioned on pricing that you expect an uptick in Q4. When we look at the PV Insights benchmark, it's down pretty much every week now, I think, for 10 straight weeks and down about 10% over that period. Are you seeing a different dynamic in your pricing structure? I think if you look at the PV Insights numbers, you're basically looking at product leaving a factory, not product being sold to a customer or to an installer or distributor. That's where we play in a little bit different space. We are continuing to see strong demand both for our IBC product and our Performance Series product. We've got you know backlogs that will carry us through Q4 and beyond, which is what's giving us the confidence in the ASP uptick that we mentioned. We're seeing you know pricing not necessarily starting to drift down yet especially for premium product. We obviously will try to maximize that as long as we can. Okay. You know, clearly some module supply constraints in the U.S. because of the issues that you touched on earlier. Where are those modules going? The ones that are being stopped at the border by customs. Are they being essentially dumped into the domestic Chinese market, or are there other international markets where they're being reallocated? I can't answer where everybody else is putting those excess modules. What you're seeing is, I'm assuming utility scale, very large format bifacial modules that are getting turned away. Outside the U.S., we're much more active in the DG space, and so we're not seeing that same product overlap into those areas. There is generally more module availability in the rest of the world than there is in the U.S. Again, we play in a very premium space, both with the IBC product as well as our Performance Series product. So far, we're not seeing any sort of flood of product that's not getting into the U.S. affecting the DG markets internationally. Okay. Lastly, EMEA region, 50% of your revenue this past quarter. I think that's an all-time high. Any particular kind of hotspots to highlight? Well, I think we mentioned France, where we're moving over 20% market share. We continue to be strong in Italy. Really all of the DG-focused markets in Europe, we're doing quite well there. The combination of our IBC product at the top end with our Performance Series product in the mid-range is really having great effect there. We are doing quite well with the AC products with the AC modules there, as we mentioned some of the penetration rates earlier. It's great to be selling more complete systems. As I said, in Q2 of next year, we expect to be shipping our storage product into Europe. We'll already be shipping it into Australia in Q1. you know, overall, we feel like that's one of our big differentiators, is our exposure to the important DG markets around the world. The U.S. is important, but the E.U., EMEA markets are also very significant. Right. Thank you very much, guys. Thank you. Thank you. As a reminder, to ask a question at this time, please press star one one on your touchtone telephone. Our next question is a follow-up from Julien Dumoulin-Smith with Bank of America. Your line is now open. Hey, can you hear me? Yep, we got you. Hey. Thank you guys much. Appreciate it again for the time here. Can we talk a little bit more about this new You're breaking up so much, Julien. We can't understand the question. You had some comments about 2028 in your prepared remarks, and you talked about the next wave of IBC technology that you were accelerating. Can you talk a little bit about the size and timeline there to align with the 2028 deliveries and demand that you otherwise described in your remarks? I think I understood that you're asking about next generation performance technology that we would be delivering in 2028. Is that correct? Yeah. I just wanted to talk about, you know, the. Go for it. Sorry, Julien, the first time you went through your question, you got about 40% of the words. You were breaking up. You're now much more clear. Could you just, like, do a super quick recap of your question? Yeah, sorry. I apologize. I don't know what's going on. Just with respect to the next iteration of IBC, you alluded to in your remarks about an acceleration on timeline as well as just the relative demand for the product through that period. If you can talk about how big and how quickly you can scale. Yeah. I don't think we talked about an acceleration of timeline, although we're obviously trying to accelerate the timeline as much as possible given the window of demand opportunity there. I mean, we're really focused on how we bring to market this next generation IBC technology. We talked about the benefits in efficiency. It's got additional benefits in other performance factors, energy yield, et cetera. We are trying to bring that to market, you know, really as soon as we can, but doing so by being additive to the volumes. I'm not really in a position to talk about exactly how much or exactly on what timeline, at this point, but those discussions are ongoing, and we certainly recognize the demand is out there, and we want to, I guess, finalize plans, as soon as we're capable of doing that. All right. Fair enough, guys. Thank you very much. Have a great day. Thank you. Thank you, Julien. Thank you. As there are no further questions, we will now conclude the call. Thank you all again. You may now disconnect.