Thank you for sticking with us on the last day of the Barclays 40th Annual Energy-Power Conference. To close out our clean tech fireside chats for this year's conference, we have Nextpower, a company that started off as a tracker company but has evolved to a more comprehensive energy technology platform, including hardware, software, and power conversion systems. Here to discuss the company is Dan Shugar, Chief Executive Officer. Hi, Dan. How are you this morning? I am wonderful. Thanks for the opportunity to be here, Christine. Yes. It is your first time at our conference, so we are very happy to have you. I thought I would start at your Analyst Day or Capital Markets Day last year. You laid out a goal of generating more than 1/3 of revenue from non-tracker revenue by fiscal 2030. You are already roughly at 15%. You have announced a number of deals since then. You guys have been very busy. Do you now look at that number as a floor? Which product categories do you expect to be the largest contributors? Yes. Thanks, Christine. We had our Capital Markets Day in November. We were finishing a year of about $3.5 billion, and we articulated a path to $5.2 billion by our fiscal 2030, which is predominantly calendar 2029. We are a couple of years ahead of schedule in terms of the revenue growth, the earnings growth, and the diversification to include other product categories. We are having another Capital Markets Day on November 16th, and we will be unpacking that in much more granular detail. As you mentioned, when we did the original or the last Capital Markets Day, we had not yet acquired an energy storage company, nor had we acquired a power conversion company, which is complementary to our organic power conversion program. We see those as very significant vectors of additional growth and highly strategic with each other and with our core business. I'll just say, each of our product categories and business units are over-performing. In totality, we've performed well and we're significantly ahead of plan, and we'll be articulating a much bigger revenue, earnings, and product diversification landing zone for our FY 2030 target. I do kind of want to touch upon the new businesses that you have entered into. You closed the acquisition of your power conversion business not too long ago. From what I understand, this accelerated your go-to market for power conversion that is still a bit further out. I guess you were internally working on a next generation product that is still further out. How should we think about how this business evolves? Should we expect you to get involved with more things like solid-state transformers, which is a big topic for data centers, but is also relevant for utility scale solar, which is your bread and butter? Yeah. Well, first let's talk about what's actually happening. We acquired a subsidiary of a Spanish electronics company, called Apex Power, which we're manufacturing inverters today. The legacy parent company called Zigor, which is based in Spain, is our contract manufacturer. Today, we have UL-listed inverters and power conditioning units to serve solar and storage. We also have IEC-listed products for solar and storage. We're actually shipping finished goods today, produced by our contract manufacturer in Spain. They'll continue supporting us. In parallel, we're building a very significant U.S. factory that will be at double-digit gigawatts that will be operational next year. We're taking orders now, and we see there's a huge vacuum and an opportunity for us to fill it. Before I get to that, the reason we made the original decision to move into this space was that when we ask our customer what their problem sets are, it is inverter, inverter, typically. There was a huge entitlement for additional performance. We believe we have got the skill set and the position to fill that gap. After we made the decision we are moving forward, a number of tailwinds with various U.S. government actions with the FCC ban, cyber security issues and concerns, and FEOC issues. That has been a great tailwind, and our customers are responding very affirmatively. Now, we could continue the product categories to include other things like transformers, either conventional or solid state or what have you. We have done 13 acquisitions in the last 2.5 years, and what we are really focused on is executing what we have now. I will just say that the inverter and power conditioning technology we have brought on, both the acquisition and the organic, is highly strategic with our storage program as well. That is a great segue into my next question. Thank you. You did mention the FCC ban and then there was the Trump ban. How do we think about this opportunity for you on the solar inverter side as well as the storage side? The U.S. really hasn't seen domestic inverters. Why do you think that is? Has it just been sort of a cost thing up until now? I guess, how much urgency are you seeing from customers to diversify their sourcing strategies? Well, let me just first say, I've been working with inverters my whole career in renewables, going back to the late 1980s. In a prior company, we interconnected serial number one IGBT inverter in solar. That was in 1994. It's not rocket science to build highly reliable products. Highly reliable products and service are not what most customers are experiencing right now in the market. There's a variety of root causes for that, but basically, there was a commoditization, people just pushing too much power through these units and not doing proper design. We really think there's an opportunity to address those reliability issues. Now, there are legitimate concerns, and also, a lot of fears around having a predominant amount of power conditioning manufactured by, let's just say, FEOC countries. Nextpower is a U.S. company. We're going to be making our controllers in the United States with our code. Our control boards are here. We're going to have full domestic supply options where customers can also get domestic content points to hit their domestic content goals. We were the first to do it on trackers and other key components, and we're going to perform. We think it's an opportunity to both improve performance to help customers improve their unlevered IRRs of their power plants, but also have supply security, cybersecurity. Nextpower is an investment-grade company in terms of pure-play companies in clean tech. I think we're the only one. So we have an investment-grade, very responsible company with a supply and support organization already in place. You're historically known as more of a tracker company, and the tracker has a longer shelf life, right? When people think about tracker, we mostly think about sort of new build, new installations, but with inverters, those, I think, tend to have a shorter life. I guess with the bans that are in place, if let's say, some of the FEOC players exit the market, should we think that there's a retrofit opportunity for you with the installed base? How should we think about that? Yeah, that's a good question. I hope it doesn't get to a point where people rip out power conditioning that's operating properly in the field. We already are serving repower applications today. We're shipping today, both overseas and in the U.S., for some of these legacy products. One thing we really like about the platform and the team we brought on is that the technology is flexible to be able to support older installations that may have been at a lower voltage. For example, in solar today, typically you have an inverter class at 1,500 volts, but some of the legacy systems are at 1,000 volts, and our platform can support that. We've actually shipped and have operating units at a range of legacy voltages. Just moving on to your storage acquisition. So, with respect to your entry here with the Prevalon deal, can you talk through why this way was the right way to enter it as an aggregator? I think historically, investors think of this as a low moat business with the view that you're just packaging things. So what do you think that you can do here that is differentiated, and what are the other synergies that are emerging that weren't initially obvious? Yeah. Great question. So, just first strategically, why did we do it? We had enjoyed about a 30% CAGR for five years in solar, then a 20% CAGR. It's still growing, but more like a 10% CAGR is what we've been delivering recently in solar, sometimes more. But the storage is really taking off, and it's not just growth for growth's sake, but also many of our legacy customers are doing storage, need storage. We need storage to do more solar too, and more wind, and that's part of our mission. So, we could make or we could buy companies, and we just saw there was a huge market need. Rather than incubate another business within the company, and we're doing plenty of that, which is working great, we decided we had a need for speed, but to do the right acquisition. So actually, we spent about a year and a half. We invested a lot, hired some top consulting companies. We basically looked at everything and talked to everybody. We have a lot of liquidity. We have about $1.2 billion of cash in the bank and a line of credit of comparable size. We could have acquired some really big companies. So we looked at everything. The reason we acquired Prevalon, we really liked this team because they have tremendous track record and knowledge around power generation. They came from the Mitsubishi Heavy Industries, which had built a battery unit to complement their gas power generation unit. The team we have understands rotating machines and the interaction between solar storage and rotating equipment, and 38 successful projects. We are in the middle of delivering, so in terms of strategically, no one was really thinking about using batteries to support inference data centers a few years ago. That is like a whole new pie. Very interesting. What is great is that you do not have to build a lot of new electric transmission and distribution. I was a former T&D engineer for PG&E. It is really hard to build new stuff. You can take the existing grids in many cases and add a battery on the customer side of the main utility transformer, whether it is on the customer side of the meter or not is less relevant. The battery can basically, when the data centers have very fast fluctuating loads, which is measured in tens of milliseconds, the battery can charge or discharge very quickly and basically stabilize the voltage and enable those systems to operate reliably. The company we acquired, now called Nextpower Energy Storage, we are in the middle of fulfilling a 1.3 GW Tier 1 + inference data center customer. That is like a brand new use case. I do not think anyone really fully understands how big that market can be. The great thing about storage is it is kind of a Swiss Army knife. You can do arbitrage. You can do this, we call it Hybrid Power Stabilizer, is our product. You can do black start for generators, all kinds of microgrids, all kinds of applications, and the company we acquired has proven track record in doing those. You raise an interesting point. With this deal, I think, and correct me if I am wrong, all of your customers have been front of the meter up until Prevalon. Is that right? With this Prevalon, it is sort of like, I do not know, I guess you can say your entry into behind the meter with this data center. I guess, how should we think about sort of the roadmap there, and with the storage, should we think those are the types of customers that you are really going to go after? Is it front of the meter? Is it both? Are there other, you are very good at going to customers and saying, "What do you need? What are your problems?" Are you already having conversations with those data centers around pinch points that extend beyond storage? Well, yes, and it is one thing that has served us well is having flexible product portfolios to serve a variety of use cases over time. One of the things that is highly strategic here, and it also reflects on your prior question about the segment, we are more than an integrator here. We are an integrator in the battery space, but we are more than that because we are also manufacturing the really core technology, which is the inverter, the EMS system, the control system that allows these products to operate reliably with the grid in a way that utilities are comfortable with. We could do what we are doing all the way from the inference data center all the way back to storage that is co-located with solar for arbitrage. There are many use cases. The day we closed our transaction, which was only six weeks ago, I went up to Boise, Idaho, and one of the customers that formerly Prevalon had served was Idaho Power. They have nine solar power systems. We were in the field. I saw a 200 MW, 800 MW hour system, which was the largest system in Idaho, and they had a very interesting use case where there was a transmission line, and at the end of that is a semiconductor manufacturer, a large chip manufacturer that has very large loads. But for the battery, they would not be able to reliably serve that customer and other customers on that circuit. But it is not exactly the data center case, it is another use case, which is basically grid augmentation. We are very excited about this, and the main thing is having the right product family to be able to address use cases, and it will be really exciting to see how things play out over the next few years because customers want to get online, but you cannot wait for the utility. Your company has changed so much since you came public. I cannot imagine what it is going to look like three years from now. Well, you know what, Christine? Just to riff on that for a second. I cannot tell you exactly what we are going to do, but what I can tell you is everything we will do will be an informed decision. And I think what our company's track record is when we enter new product lines, for example, 11 years ago, we built a software business around our TrueCapture platform. We acquired a machine learning company, and we built this incredible software business, which is helping our customers get much higher returns on their power plants with this yield optimization software. It remains best in class. We built this great software business, and if you look at all the new product line and families that we have brought into the company, they are all performing. What we are really focused on is being very sober, prudent, doing things that add value to customers, and then really focused on operational excellence with on-time delivery, excellent quality, and then ensuring whatever our promises are that we deliver. You touched upon storage, and I actually have a question on that. When you came public, I think software was the only "recurring revenue" you have had. I could be wrong here, but it seems like you are quietly trying to build up your recurring revenue with other solutions, such as maybe O&M offerings, et c. Can you talk about what you are thinking here? How big can this get? Or will this just sort of be a smaller part of the business with respect to percent of revenue, but it can materially improve gross margins as these businesses just tend to be higher margin? First, thank you. Very insightful. Yes, we are building out a recurring revenue business. It is step by step, like everything we do. We do have an element of that in our software business, and in particular when it is done overseas. Now with our battery business, they have a significant portion of that business that is LTSAs to service those batteries over the long term. That is a big step forward on that. If you look at the population of our fleet, we have shipped so much, over 160 GW, and we had record revenue last quarter, so we are continuing to ship at very high rates. A lot of the older equipment is rolling out of warranty over the coming years. What we have been doing is really, before it was sort of a rush to ensure that we had the right product family and that we were capturing a large share of the market. By the way, we have had 11 consecutive years as number one globally and in the U.S. Last year we were 30% global share, and in the U.S. we are about 55%. We do not try to optimize for share, but it is a byproduct of innovation and serving customers. So we have this huge legacy fleet, some of which is rolling out of warranty. That is an opportunity to then support customers with long-term parts and service and so forth. We just brought a Senior Executive on, Senior Vice President to build our services business, software business. It is still on a top-line basis, a small percentage. But that's something strategically we are leaning into, and in particular with the storage business, we want to add to that as we go forward. I'm not incorrect in thinking that this is a higher margin business? It's a higher margin business. Okay. Yes. If there's sort of one bottleneck that you think could slow down sort of deployment across your product portfolio, is it interconnection? Is it transmission, finance? Well, I don't think it's financing, but supply chain, labor, what's on your mind or what keeps you up at night? I think the thing that's had the biggest impact is just the unstable federal policy. We've just seen lots of things happen, and when they do, they can temporarily slow down the market. The latest thing [Non-English content] is the Section 232 tariff. We think solar goes forward with that, but it can impact. A customer told us the other day it was kind of like a mid-single digit impact on the PPA price they needed. I'm sure different customers have different views, but that required them to go back to some of the deals they were trying to close, which were for projects that are two to three years out, not for things that are happening this year or next year. That was a headwind, kind of temporary. A few months before that, federal government started imposing English-speaking language tests on truck drivers out of the blue. If they didn't pass the test, they were disqualified. We have a few weeks where we couldn't get truckers to some factories. We have 35 factories in the U.S. operating that are run by others for us. By the way, I came up with this financing method called the OPM method. Have you ever heard about that? Other people's money? Exactly. It's our best way of doing factories, although we do operate some factories in some places where it makes sense, like Saudi Arabia and Brazil and a few places. Generally, yeah, we like the OPM. This trucker thing, you couldn't get truckers for a certain number of weeks, so that slowed things down. There's just been a lot of that and then a lot of tariff stuff. The need for power doesn't go away. The projects don't go away. Hopefully we have a little more stable environment. That would be the big thing. Despite all that, we've powered through. We had record revenue last quarter. We have record backlog again. We're certainly performing the demands there. I would think that in the U.S. would be the top thing. I think overseas, you cannot overstate the impact of this latest Gulf War on the fundamental economics of what we do in solar and storage because 20% of the world's liquified natural gas is offline. The price of gas in Asia tripled to quadrupled for LNG. It is way higher in Europe. Europe is a huge market we are leaning in, and we are just about to close our third major acquisition with Zimmermann. So we are acquiring a company in Germany that will bring us not only Germany, where we have done very little over the years, but 15 additional new countries in Europe that we have not served. Nextpower has served 45 countries- 50 countries, but this will bring us 15 new countries. That Zimmermann deal has been approved by the German government. We are waiting on one additional approval. We think that will happen soon. Zimmermann is well-positioned, brings us some additional product families, like fixed systems for sites that are very constrained, floating systems. I saw on your Barclays thing at the registration, this huge floating project. Zimmermann is one of the leaders in Europe on that, and that is, for them, a high-margin business. So with them, not only do we get the additional product line, we will be able to sell through, and in one acquisition, our international business significantly expands. We are very excited about that. That will also add to the top-line growth. We will be speaking about that at Capital Markets Day. We expect it to be closed by then. When you talked about the policy, you mentioned 232, and I know earlier I asked about the ban on inverters and things like that, and that is generally viewed as sort of a positive thing for someone in your shoes. But then, during this conference, one of the things I heard, and I would love to know if you are seeing something similar, is that the Trump ban has kind of made customers, it has put uncertainty into the market and has paused orders as customers are trying to evaluate, especially because, I guess, there are, quote-unquote, "rumors" that additional things or additional bans can come into place before the Xi-Trump meeting on the 24th. Is that something you are seeing? Or no, it is business as usual, it is not a big enough thing for people to be concerned about? Do customers have concerns that there is going to be additional rules from the administration regarding inverter-based systems? Yeah, there are concerns. Do I think that is going to happen? Yes. But that further underscores our strategy and why you would want to work with a company like Nextpower that is investment grade, domiciled in the U.S., making products in the U.S., and basically able to deliver reliably and have also a service support network, and a tremendous brand around performance. So we think, for us, that is a tailwind for this, in particular this segment. What it also does is it motivates customers. We have a lot of customer goodwill. But if you go to a customer and said, "Hey, we have got this great new family of inverter," let us say they were working with an overseas product, they would be like, "Oh, okay. That is great. We would like to work with you. We'll think about you for the next project." But if all of a sudden there's an existential issue with receiving or commissioning a particular product from an overseas manufacturer or the specter of that happening, we're very motivated to quickly redesign the system or amend the existing design of the system, going back to the utility and perfecting the ability of that to move forward. That's what we're experiencing. We're very much there to solve customer issues. But again, what we're very focused on is performance, reliability, uptime. What we're promising customers is our goal is to have the most available from that standpoint. If you look back over the course of the year, our power conditioning family of products is online performing available because the fleets have really suffered less availability than they could be operating at. Okay, I'm going to squeeze one last one in here. Sure. You've been very acquisitive. I know you can't really time these things. But as you have a very strong balance sheet, you announced the buyback. I think a $500 million over three years, if I'm remembering correctly. Should we think that it's going to take three years? Or is it possible that it accelerates? With respect to M&A, is the focus now just to execute on the acquisitions that you've done? Or no, there are still a couple of holes that you would love to fill if and when the opportunity presented itself? Sure. So we had a strategy that we completed about two to three years ago about creating an entire platform. We have executed that, generally speaking. There are always opportunities to add value with some incremental products or services. We are in, as you mentioned, a very strong liquidity place to do that. We are also heavily investing in R&D. We have tripled our R&D budget over the last four years, well over $100 million. And many new products keep popping out of that, and that generally is the highest return on invested capital from a new product standpoint. We did announce a $500 million buyback over three years that was approved by the Board. We are executing on that. We are buying back our stock. Now is a good time because valuations in our sector have come down. But that was really our first foray into buyback. We started that. Could we complete that early and do more? Sure. We have not had internal discussions or done that with the board at this point. We remain in a very strong position. We like having our fortress balance sheet, as our CFO, Chuck Boynton, who will be here for the conference, likes to say. Also opportunistically, if companies come along, they have a liquidity problem, they have got great tech, great position in the market, we can evaluate, and we are getting people calling us all the time. But what we are really focused on is serving our customers' needs, really focused on operational excellence, meeting or exceeding performance with our customers, our investors, and so forth. And we are very pleased to have articulated a strategy, being a couple of years ahead of schedule, and now really powering through all this choppiness we have seen in the market with reliable performance. Okay, Dan. Thank you so much for all your insights today, and thank you everyone for joining. Thanks for the invitation, Christine.