Ladies and gentlemen, greetings and welcome to the Quantum Corporation Q3 fiscal 2026 financial results conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero. As a reminder, this conference is being recorded for replay purposes. It is now my pleasure to introduce your host, Quantum's Vice President, Corporate Affairs and Corporate Secretary, Tara Ilges. Please go ahead. Good afternoon, and thank you for joining today's conference call to discuss Quantum's Q3 fiscal 2026 financial results. With me on today's call are Hugues Meyrath, Quantum CEO, and William White, our Chief Financial Officer. Following management's prepared remarks, we will open the call to questions from analysts. Before we begin, I would like to remind you that comments made on today's call may include forward-looking statements. All statements other than statements of historical fact should be viewed as forward-looking, including any projections of revenue, margins, expenses, adjusted EBITDA, adjusted net income, cash flows, or other financial, operational, or performance topics. These statements involve known and unknown risks and uncertainties that we refer to as risk factors. Risk factors may cause our actual results to differ materially from our forecast. For more information, please refer to the detailed descriptions we provide about these and additional risk factors under the Risk Factors section in our 10-K and 10-Qs filed with the Securities and Exchange Commission. The company does not intend to update or alter forward-looking statements once they are issued, whether as a result of new information, future events, or otherwise, except where required by applicable law. Please note that today's press release and management statements during today's call will include certain financial information in GAAP and non-GAAP measures. We will include definitions and reconciliations of GAAP to non-GAAP items in our press release. With that, it's my pleasure to turn the call over to Quantum CEO, Hugues Meyrath. Thank you, Tara, and good afternoon, everyone. Thank you for joining us for our Q3 earnings call. As announced earlier this afternoon, revenue EBITDA exceeded the high end of our forecasted range. These results reflect our efforts to maintain disciplined execution of our strategy. Over the past two quarters, we've put a deliberate structure and focus in place to execute our operating plan. As a result, we've seen meaningful improvement in revenue, pipeline, and backlog. We also continue to strengthen our financial foundation. Through restructuring initiatives, we've lowered our cost structure in support of our near-time goal of achieving positive cash flow. During the Q3, shareholders approved a proposal to exchange the term debt held by Dialectic for convertible notes, reducing our outstanding term debt by approximately 50% to historically low levels. We continue to evaluate options for our remaining term debt as we work towards further strengthening our balance sheet. To better frame up our results, let me first address the broader market environment and the conditions impacting infrastructure decisions across the industry. As AI use cases continue to accelerate, customers are feeling the real impact from cost, power, cooling, and the volume of data that must be retained for the long term. At the same time, AI-driven demand is increasing pressure on global supply chains. Critical components, particularly memory, disk, and flash, are becoming increasingly difficult to procure, and prices are rising as a result. In just the last 10 days, we've seen pricing double and in some cases triple. This is not unique to Quantum; it's affecting the entire industry. In addition to pricing volatility, lead times are extending into weeks and sometimes even months. Similar to the early COVID period, the timing and path to stabilization remain unpredictable. Against this backdrop, it's important to highlight that we delivered a strong Q3, and we believe we're off to a strong start to Q4. We are executing on our sales plan and have now delivered two consecutive quarters of healthy backlog. Early in Q4, we secured multiple $1 million purchase orders from enterprise and hyperscale customers, reinforcing the strength of demand for our solutions. That said, given the pricing dynamics and component availability, we're erring on the side of caution with our Q4 forecast. The uncertainty is not about the demand or our expectations for execution on our plan. It's about when we can fulfill and ship orders as supply chains continue to fluctuate. This is a prudent approach in an environment that is changing in real time. These conditions also reinforce where Quantum is uniquely advantaged. Tape is in Quantum's DNA. We are early inventors and longstanding innovators in tape, with decades of engineering, leadership, and deep intellectual property. Quantum Scalar tape libraries are designed to be modern, high-performance systems that deliver nearline accessibility for AI workloads. It also offers the lowest cost and lowest power consumption of any storage medium available. As flash and disk become more expensive and harder to secure, we believe tape provides customers with a practical way to offload massive volumes of data to a cold tier, freeing up primary storage while meaningfully reducing power, cooling, and operating costs. This is especially critical as customers retain more data than ever for AI, compliance, and long-term reuse. We are already seeing this shift clearly in our results. Our tape sales doubled quarter-over-quarter as customers pivoted toward architectures designed to reduce dependence on constrained components and deliver predictable economics at scale for warm and cold data. As a recent example, in Q3, we secured a seven-figure deal with a large multinational production studio, driven by cost, power efficiency, durability, and security of Quantum's cold storage architecture. The customer selected ActiveScale Cold Storage integrated with our Scalar tape libraries. This customer was able to repatriate content from the cloud to on-premise archive with predictable long-term economics, while maintaining Nearline access to archive data for AI-driven repurposing and reuse. The initial deployment is 100 petabytes, with plans to scale to 400 petabytes over time. As the cost of flash and disk continues to rise and availability becomes more constrained, customers are increasingly looking for reliable, low-risk ways to move data off expensive primary storage without disruption. This is where Quantum StorNext creates a unique opportunity for us. StorNext is a leading data movement platform with thousands of customers worldwide, and like traditional data movers, StorNext can seamlessly and reliably migrate data from virtually any storage platform across vendors and architectures directly to tape. This allows customers to offload data from high-cost primary storage to tape with confidence and reclaim valuable capacity. It also allows customers to avoid continuously provisioning additional primary storage amid rising prices and component shortages. Together, StorNext and Scalar tape enable customers to reduce their dependence on constrained components, lower costs, and extend the life of their existing primary storage infrastructure. Given StorNext's proven reliability and broad install base, we see this as a meaningful opportunity for incremental growth as customers reassess their storage strategies in today's market environment. We also continue to execute our broader go-to-market initiatives. We strategically realigned our North America sales model to mirror the successful approach used in EMEA, where we have seen strong results, improving focus, coverage, and execution. The alignment is driving tighter account prioritization, stronger coordination across sales, marketing, and our channel partners, and greater consistency in how we pursue and close opportunities. At the same time, our lead generation initiatives are gaining traction, delivering higher quality opportunities into the field and supporting pipeline growth. These efforts are resulting in larger, more strategic, multi-product opportunities as customers increasingly look for trusted partners to help them navigate cost pressure, supply constraints, and also long-term data growth. We're seeing channel partners lean in more actively, particularly around tape and StorNext, as customers reassess their storage infrastructures. Before turning the call over to review our financial results in greater detail, I'd like to take this time to welcome our newly appointed CFO, Will White, who's joining us on today's conference call. Will brings an exceptional combination of financial discipline, operational leadership, and strategic vision to help drive Quantum's execution in this next stage of our growth. I look forward to working more closely with Will for his contributions to our future financial strategy and operations. With that, I will now turn the call over to Will. Thank you, Hugues. Good afternoon to those joining us on the phone and webcast. I will provide an overview of the company's GAAP and non-GAAP financial results for our third fiscal quarter, 2026, ended 31 December 2025. Revenue in the quarter was $74.6 million, an increase over the $62.7 million in the prior quarter and $68.7 million in the prior year Q3. The higher-than-expected revenue was partially driven by strong backlog coming into the quarter, as well as a strong shipment into the quarter end. The positive variance to the preliminary result was due to a conservative assumption related to deferred revenue contracts. We exited the Q3 with a strong backlog of over $20 million, which is significantly above our historical run rate of $8 to 10 million. We expect backlog to remain meaningfully above our historical run rate in the fiscal Q4, reflecting the continued success of our revitalized sales organization.... GAAP gross margin for the Q3 was 38.8%, compared to 37.6% in the prior quarter and 40.6% in the fiscal Q3 of 2025. Although we still have more work to do in order to expand gross margins back above 40%, the sequential increase in the Q3 reflects the initial improvement in operating efficiencies from our restructured service organization. As Hughes mentioned, we are also seeing volatility in pricing and component availability throughout the industry, which may be a headwind to our 40% margin target in near term. GAAP operating expenses for the Q3 were $30.1 million, compared to $31.7 million in the prior quarter and $35.6 million in the year ago quarter. The increase in GAAP operating expense from our preliminary results announcement is due to additional provision for the outstanding receivable balance with Quantum Storage Asia, also known as QSA, following the termination of their distribution rights in fiscal Q2. We believe that this is prudent for our GAAP results. However, we are now seeking alternative measures to recover these balances to protect our customers' ability to make valid service and warranty claims. As mentioned in last quarter, QSA is not affiliated with Quantum and is not authorized to use our name or sell our products or support. Operating expenses on a non-GAAP basis for the Q3 were $26.9 million, compared to $24.8 million in fiscal Q2 of 2026, and $30.1 million in the year ago quarter. The sequential increase preliminary reflects higher variable sales and marketing expenses related to higher commissions. The year-over-year decrease reflects the realized savings from a lowered cost structure following our more recent restructuring actions in the current fiscal year. GAAP net loss in the fiscal Q3 was $27.8 million, or a loss of $2.03 per share, compared to a net loss of $46.5 million, or a loss of $3.49 per share in the previous quarter, and a net loss of $75.3 million, or a loss of $15.35 per share in the year ago Q3. The current GAAP net loss includes $28.9 million in debt extinguishment costs related to the most recent amendment to our term loan, in which we converted term debt for a senior secured convertible note. The convertible note was issued in exchange for $54.7 million of term debt that was recorded at a fair value of approximately $76 million. Each quarter, we will record an adjustment to the fair value for both the convertible note and the forbearance warrants, which will be largely driven by our stock price. This requirement will introduce some volatility into our GAAP earnings on a go-forward basis. Non-GAAP loss for the Q3 was $4.9 million, or loss of $0.36 per share, compared to a net loss of $7.1 million, or a loss of $0.54 per share in the prior quarter, and a net loss of $7.8 million, or loss of $1.59 per share in the same quarter a year ago. The improvement in non-GAAP net loss for the quarter reflects a combination of the revenue increase in the quarter, combined with a significant reduction in operating expenses, while we continued to bear approximately $5.9 million of interest expense. As we execute on our plan to further strengthen our balance sheet, we expect to benefit from reduced interest burden. Adjusted EBITDA for the Q3 improved sequentially and year-over-year to a positive $2.9 million from a positive $0.5 million in the fiscal Q2 of 2026, and a $0.8 million in the prior year quarter. A significant improvement in adjusted EBITDA was primarily driven by the execution of our restructuring initiatives that significantly lowered our cost structure over the prior quarter. Turning to an overview of debt and liquidity at quarter end, cash, cash equivalents and restricted cash at the end of the fiscal Q3 were approximately $13.8 million. Total outstanding debt, split between term debt and our convertible note, was $54.6 million and $75.9 million, respectively. At the end of the quarter, the company's net debt position was approximately $116.7 million. The significant decrease in our term debt reflected the successful completion of our strategic debt exchange, in which we issued senior secured convertible notes to Dialectic in a dollar for dollar exchange for approximately $54.7 million of term debt previously held by Dialectic. Turning to the company's outlook for the fiscal Q4 of 2026. As Hughes discussed, we are erring on the side of caution with our Q4 forecast due to increasing difficulty in procuring critical components across the entire industry. It is not a question of demand or our ability to execute on our plan. It is about when we can fulfill and ship orders in a challenging supply chain environment. In light of the industry-wide supply chain challenges, revenue for the Q1 is expected to be approximately $68 million ± $2 million. We expect Q3 non-GAAP operating expenses to be approximately $27 million ± $2 million. As a result, non-GAAP adjusted net loss per share for the fiscal Q4 is anticipated to be -$0.33 ± $0.10 per share, based on an estimated 15 million shares outstanding. Adjusted EBITDA for the fiscal Q4 is expected to be breakeven ± $2 million. With that, I now hand the call back to Hugues. In closing, I'm pleased with the continued progress the team is making in our sales and operating initiatives, as evidenced by our Q3 results. Our revitalized sales team is executing and delivering meaningful improvements to our pipeline and backlog, with a growing number of multimillion dollar deals. We've also significantly lowered our cost structure while further strengthening our balance sheet. We're cautiously navigating the industry-wide pricing dynamics and component shortages, and I believe Quantum is uniquely positioned with our portfolio of Scalar tape libraries, ActiveScale storage, and StorNext. With that, I'll now turn the call to the operator for the Q&A session. Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please, while we pull for questions. Thank you. Our first question comes from the line of Eric Martinuzzi with Lake Street Capital Markets. Please proceed. Congrats on the good results for Q3 and on the healthy guide for Q4. I wanted to dive into the different product segments here, just based on the 10-Q filing. It looks like there was good strength in secondary, but the primary systems were... You know, I hate to judge by one particular quarter, so I'll go with the nine-month contraction here. It looks like it is down about 23%, in the nine months versus nine months a year ago. What's behind that? You know, typically, that would be a StorNext. It would be, you know, flash related. What can you tell us about the primary storage systems? I would, I would say we started the year probably very, very slow, and, but going into fiscal Q3, we saw strength across all the product lines. W e feel confident right now that we're on the strong path for Primary Storage. Okay, and then as far as the backlog goes, you talked about, hey, it's elevated. It's $20 million, when it typically runs $8 to 10 million. The expectation that that's gonna stay high, is that driven more from the demand side, or is that driven more from the lack of component availability side? The demand continues to be very strong i n fact, we had a very healthy January as well, so we expect the backlog to be healthy going into our fiscal Q4. But it's both demand is very strong. We do have some shortages in components, but like, it's the backlog is growing faster right now than anticipated, for sure. Okay, and then the services business, we've been in contraction mode here for a while. It was down a little bit less in Q3 than it was for the nine-month period. Are we getting to a point where that could potentially flatten out here, and we're no longer seeing that contraction in services? I would think so. I think we still struggle a little bit from an execution perspective in terms of getting the most of our services from customers. We tend to discount services too much on a blended basis, which is why we have kind of this SSP mechanism in place to reallocate. I would think right now it's more of a our ability to execute a little bit better on services and not discount so much t hat's more of an issue than the contraction. I think we got to do a better job there, for sure. Okay, and then last question for me y ou talked about gross margins being somewhat impacted by the price of the components that you're needing to acquire, but you still are looking at a 40% target. We've seen good progress throughout the year with the non-GAAP gross margins rising in Q3 versus Q2 and Q2 versus Q1. What should we expect for Q4 based on the product mix and the services mix that you're thinking about for Q4? Do we go up sequentially? Do we retrace based on mix? I think you've... This quarter is actually quite hard because the supply chain issues are hitting everybody in the industry, like everybody, and it's pretty bad across the board, from server delivery to memory to any storage that you're trying to acquire, the prices are going up. So when prices go up, by the time you, you know, to turn it over to a quote and you try to build a product and ship the product, it's been very hectic environment a nd there are a lot of examples in the industry that, that prove that that's an issue industry-wise. It's pretty hard to guide to margin right now. Okay, so a conservative view would be to say, you know, equivalent would be a good achievement?... equivalent to Q3? It would be, yes, it would be a very good achievement if we could stay there. In rising prices and... I mean, we hear examples of people literally like prices changing on the docks of some of our partners in the supply chain business and, you know, till until things are inventory, there is flux. I t's quite a challenging environment right now from a pricing perspective, and lead times are definitely stretching as well. Got it. Thanks for taking my question. Thank you. I appreciate it. Thank you. Our next question comes from the line of Nehal Chokshi with Northland Capital Markets. Please proceed. Thanks, and congrats on a good sustained demand here with the, as evidenced by the elevated backlog. You made a comment, Hugues, that tape sales doubled Q to Q. Could you give some color here in terms of where that demand is coming from with respect to hyperscalers versus non-hyperscalers? Tape is very strong across the board right now, but what we're seeing, mostly from a growth perspective, is people are just running out of storage. And with ActiveScale Cold Storage, they found a way for to keep storage on-prem for longer. So some of it, we see people that are migrating back from the cloud because they want to use data, and ActiveScale Cold Storage allows them to use and reuse the data. We've seen some wins in the Fed space last quarter, so I mean, it's pretty much across the board. Hyperscalers also have capacity upgrades planned. Some of them are not realized yet t hey're more coming in as well. I think in general, I'm very optimistic on tape because people are running out of storage, and I think that's creating a new wave of demand in addition to what we have today i t's not just object store, but I think people are gonna need to offload some of their primary storage data somewhere, because clearly the demand for storage is way ahead of the supply right now. Okay. And then you also mentioned that you have a growing number of multimillion-dollar deals. Is that with respect to pipeline or in backlog? It's in... We have a bunch of them in backlog, yes. Okay. Can you give us a sense of the composition there, again, with respect to hyperscalers versus non-hyperscalers? With the multimillion-dollar deal, like we're talking mainly, I mean, we take hyperscalers to be all multimillion-dollar deals, and they are. So in general, what we're talking about there is our typical customers right now are adding more to their orders s o you can have a combination of StorNext and ActiveScale and cold storage in an order, where we feel so people really building larger and larger, like, environments, especially with regards around like an i7, for example. So you can actually have, you know, good like, AI content, like, around that solution with ActiveScale. Okay, great. You already talked about backlog levels. You said at the end of the December quarter, it was already at $122 million. It's growing faster than anticipated, and so over the last six weeks, which then implies that it has gone up as the quarter has progressed. It sounds like it's a function of demand as well, supply. But I guess you're trying to frame up, though, that demand is your core demand from the enterprises is up year-over-year, and then also the hyperscalers are helping there as well. Is that a correct read-through on the description that you're giving here on backlog and the trajectory there? Yes, it's January's been... You know, it's been strong Q3, but it's fiscal Q3, but January's been strong as well, and we don't fulfill as many orders in January, so the backlog keeps growing, but we'll probably exit next quarter with a much greater backlog as well at the number we guided to. So we're seeing strength across both enterprise and hyperscalers, for sure. Yeah. At this point in time, do you see supply- It sounds like you see supply actually worsening. So if demand continues to sustain at this current level, you would anticipate then that backlog would continue to grow from whatever level that it is right now? At our guidance level, the backlog will grow, yes. Okay. Last question from me is that, you know, you've been, you've been in the seat now for about nine months, right? And I know that you've gone through a lot of restructuring, reorganization, but you have a, you know, really deep storage industry experience, and as a result, do you have some perspective as far as, like, what sort of, long-term margin structures you can achieve? Yeah, I mean, look, I mean, going back into the 40% long-term margin with the products we have right now in our go-to-market we have right now is, you know, obviously possible i mean, I'm more concerned right now with the way the supply chain is working these days i t's, you can go listen to anybody else. It's not clear how there will be relief from a supply perspective in the near term, right? F eels like a COVID era right now. It's hard to get lead times i t's hard to get commits from suppliers it 's hard to get pricing from the suppliers, right? R ight now, we're just trying to manage the business that's ahead of us and what we can get our hands on, what the prices are, and make sure we treat our customers and partners with the utmost respect, right? Now, from a long-term perspective, I don't know when that is, but the supply chain needs to normalize w e'll get back into the 40s i think we've done the restructuring needed to be in the 40% margin business and continue to improve it. But right now, it's kind of a little bit across the industry and uncharted territory from a pricing and lead time perspective, b ut I think restructuring's been definitely paying dividends for sure. Okay, great. Thank you. Thank you for that perspective, initial perspective. Of course. Thank you. There are no further questions at this time, and with that, this concludes today's webinar. You may disconnect your lines at this time. Thank you for your participation.