Good day, and thank you for standing by. Welcome to SunPower Corporation's fourth quarter 2021 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press Star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press Star zero. I would now like to hand the conference over to your first speaker today, to Mr. Michael Weinstein, Vice President of Investor Relations at SunPower Corporation. Thank you, sir. You may begin. Good afternoon. I'd like to welcome everyone to our fourth quarter 2021 earnings conference call. On the call today, we will start with comments from Peter Faricy, CEO of SunPower, who will provide a summary of 2021 strategic plan accomplishments and discuss our forward-looking commitments for 2022 and beyond. Following Peter's comments, Manavendra Sial, SunPower's CFO, will then review our fourth quarter financial results, as well as provide an update to our guidance. As a reminder, a replay of the call will be available later today on the investor relations page of our website. During today's call, we will be making 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, our 2021 10-K, and our quarterly reports on Form 10-Q. Please see those documents for additional information regarding those factors that may affect these forward-looking statements. Also, we will reference certain non-GAAP metrics during today's call. Please refer to the appendix of our presentation as well as today's earnings press release to the appropriate GAAP to non-GAAP reconciliations. Finally, to enhance the call, we have posted a set of PowerPoint slides that we will reference during the call in the events and presentations page of the investor relations website. In the same location, we've also posted a supplemental data sheet detailing additional historical metrics. With that, I'd like to turn the call over to Peter Faricy, CEO of SunPower. Peter? Thanks, Mike, and good afternoon, everyone. As you are aware, we reported our preliminary fourth quarter results last month, and today we are reporting in-line results. Before Manu shares the results details, I will review the strength of the underlying business, our five strategic pillars and progress in 2021, and plans for 2022 for each pillar. Please turn to Slide 4. For the quarter, we continued to see strong top-of-funnel lead generation in our residential business with nearly 22,500 new customer bookings in the quarter, a 42% increase over last year. This led to a record 17,000 customers added in the quarter, representing 31% year-over-year growth and our largest ever backlog. Our total customer install base stood at 427,000 at year-end. We continued to sustain residential gross margins above 20% with a 100 basis point increase versus last year at 25.6% for the quarter, a record high. Adjusted EBITDA per customer before product and digital investment was $2,200. Our new home segment continues to grow strongly with a record pipeline of 66,000 customers as we enter 2022, more than 40% higher than a year ago. Finally, SunVault bookings exited 2021 with a run rate over $130 million. As we disclosed in our preliminary announcement last month, we experienced some installation delays in the fourth quarter due to weather and Omicron. Similar to the rest of the industry and economy, we were impacted by some cost and availability pressure on our supply chain and labor pool. Despite these short-term challenges from the pandemic, we are very optimistic and excited about our future as we execute our strategic plan to become the world's most customer-centric home energy company. Please turn to Slide 5. As you know, we are transforming SunPower into a residential solar company focused on providing a world-class customer experience that moves well beyond the initial system sale to a full ecosystem of integrated products and services to create a lifetime relationship with SunPower. I believe strategies are only as good as the quality of the leadership team behind them. In 2021, I focused on building a talented and experienced leadership team to execute on the following five strategic pillars. Pillar 1 is customer care. Customers are at the center of all of our discussions. After hiring Nuala Murphy last year as Vice President of Customer Care, we have been rapidly improving our entire approach for customer service. Our guiding principle is that if a customer discovers a problem, that is a defect. We are proactively striving to identify any issues well before our customers do, and then we will exceed their expectations with a timely solution. Ultimately, I expect customer feedback to help guide our corporate and product development for ever-increasing levels of quality, which remains a major component of the SunPower brand. We also recently hired Derek Cusack as our Executive Vice President for Supply Chain Quality and Field Operations. In residential solar today, the process to install and activate new solar and battery systems is slow and bureaucratic. Our goal is to make the process of installing solar fast, easy, affordable, and enjoyable. Derek and his teams are focused on innovations to deliver world-class customer experience. Pillar 2 is growth. We are growing our market share with a world-class dealer network supported by the entire SunPower product, digital, and financial platform. We are complementing that network with a high-growth SunPower Direct channel and a leading new homes business featuring new and expanded partnerships. In October, we welcomed Ben Peterson and the Blue Raven team into the SunPower family. Blue Raven is off to a terrific start this year. I'm pleased to report the integration process is going very well, and we have already launched SunPower Financial products at Blue Raven. We also recently hired June Sauvaget as our Chief Marketing Officer. June Sauvaget comes to us from Rex and Spotify and will help guide the company's customer acquisition and brand strategy. Under June Sauvaget's leadership, our goal is to build a true direct-to-consumer brand with a much more cost-efficient customer acquisition process. Pillar 3 is best and affordable products. We are expanding our offerings to include not only our premium solar system SunPower has been known for, but also an array of quality and affordable products. We recognize the value of a lifetime customer relationship, and we will nurture that by providing an entire ecosystem of fully designed and integrated products and services that are simple to use and money-saving with clean and reliable energy at their core. As you know, we hired Nate Coleman as our Chief Products Officer in November, and Nate has already accelerated this effort. Pillar 4 is digital innovation. Our vision is to make buying solar as easy as it is to buy a book on Amazon. To accelerate innovation of the customer experience, we recently hired Ellen Kinney as our Vice President for Digital Products. Ellen will help push our digital innovation strategy to include major upgrades to the mySunPower app to provide a more efficient sales process, more control options for our customers, and increased ease of use to boost adoption. In addition, we are pleased to announce our most recent new hire, Kumar Brahnmath, EVP of Software Technology. Kumar is a world-class technology leader from Amazon who will build best-in-class solutions for our customers and dealers. Pillar 5 is world-class financial solutions. We recently hired Jason McGray with the objectives to drive higher sales rates, faster closings, and a broader customer base while contributing to our lifetime customer value. Please turn to slide Number 6. We have already made major strides towards the achievement of our strategic goals. First, we've made measurable progress towards improving customer care in 2021 with our commitment to proactively discover and correct issues before customers even notice whenever possible. Our handling of the recent connectors issue on the commercial equipment reflects this philosophy. Additionally, we reduced customer issue resolution time by greater than 50%, and the number of customer interactions required to obtain resolution have improved by 1,300 basis points into the high double digits. Second, Blue Raven Solar expands our presence outside California and adds firepower to our direct channel, especially in states without a significant SunPower dealership network and no or low SunPower share. Our pipeline of potential new home installations continues to grow. We executed an exclusive agreement with Toll Brothers last year in California that provides a framework for further expansion nationally. We grew our market share in new homes and continue to work towards new partnerships. We announced our 25 by 25 initiative in 2021, which includes the goal of diversifying our residential customer base to include 25% from historically underrepresented communities by 2025. We're very proud of this commitment, which we will meet with new high-value product offerings at various price points, among other initiatives. We've already added new financial products for customers with expanded eligibility and low interest rates to help capture this important market segment. Third, on the product side, we restarted sales of our SunVault storage product last summer with rapidly growing bookings and healthy inventory. We also recently introduced our first residential virtual power plant offering under Connected Solutions. This is a program that enables our customers to receive payments from their interconnected utility in exchange for degrees of partial control over customer SunVault systems. We are also very pleased to announce our new partnership with OhmConnect that we expect will expand our ability to bring financial value to customers quickly and meaningfully. Most importantly, these programs bring real, tangible benefits to utilities and their non-solar customers as well. They provide a source of highly distributed storage that can help offset the need for distribution upgrades as increasing numbers of electric vehicles and rooftop solar systems get interconnected. Fourth, as I mentioned, we have the right leadership team now in place to accelerate our digital efforts to enhance the mySunPower app as well as our design software to greatly support both our customers and our sales teams. Fifth, SunPower Financial was launched in December, which provides us a platform for off-balance sheet customer financing, and we entered into a forward flow loan purchase agreement with an affiliate of Credit Suisse. Thanks to our strong leadership team and the dedicated mission-driven talent at SunPower, we got a lot done in 2021, and we have a lot more planned for this year. Please turn to Slide 7. In 2022, we are leaning in and investing for growth. You can expect to see meaningful progress along several strategic lines, including first, SunPower is making major investments to upgrade customer services. We believe that exceeding customer expectations for support is key to creating and maintaining our premium brand and growing lifetime customer relationships. You can expect more updates about this initiative at our Analyst Day. Second, continued rapid expansion of sales throughout the country, especially outside California, as we invest in our dealer network and expand our team at SunPower Direct. Third, we plan to introduce new high-value, high-performance panel and storage options that will have strong appeal beyond the premium residential segment that we currently capture. As we explore our options in the coming weeks and months, we look forward to providing you with a more detailed update at our Analyst Day. Fourth, we are making a digital product investment to improve our customer experience and our operational efficiency. Finally, at SunPower Financial, we are reiterating our plan to increase the origination of residential financing from 35% in 2021 to 45% in 2022. This helps our customers qualify for financing quicker while helping our dealers and direct salespeople close sales faster. It also brings new fee income that we've never previously captured. When you add all this up, SunPower is on a path to change the world for millions of solar customers. We are passionate about our mission, and we are just getting started. The seeds that we are planting now will bear fruit for years to come as we build the world's most customer-centric home energy company. Before I turn the call over to Manu, I'd like to address our new module supply agreement. The new contract terms allow us to continue offering our existing residential products while exploring additional panel providers immediately. Most importantly, the new deal will ensure we can serve customers and dealers given the strong demand for residential solar. I'll close my comments by re-emphasizing how pleased I am with the strength of customer demand. From my perspective, consumer demand is the single most important metric of our health. Now our focus is on serving and delighting our customers. We plan on having an Analyst Day on March 31st in San Diego. I look forward to seeing you there and introducing you to our leadership team. With that, I'd like to turn the call over to Manu Sial, CFO of SunPower. Manu. Thanks, Peter. Please turn to Slide 9. Our results for the quarter were in line with our pre-announcement on January 20th. We are reporting -$8 million of adjusted EBITDA, which includes the previously disclosed $27 million charge for cracked connectors in commercial equipment with an incremental $4 million charge expected in the first quarter of 2022. It also includes $3 million of higher sales and marketing expense, as well as the $6.5 million impact from weather and COVID-related delays. We're also reporting $385 million of revenue, 12% higher than a year ago, and 19% higher sequentially versus third quarter of 2021, driven by the underlying strength of our residential business. We exited the year with a healthy balance sheet with $127 million of unrestricted cash and another 2.5 million shares of Enphase held for future sales. As a reminder, the acquisition of Blue Raven Solar in October was funded with the prior sale of 1 million shares of Enphase, and I'm happy to report that the integration of the Blue Raven team is going very smoothly. We enter 2022 with a very strong residential fundamentals and a record high backlog, now the sole business of our company. Please turn to Slide 10. Top of the funnel customer appointments and bookings continue to climb and our residential gross margins for the quarter were the highest in nearly six years. Specifically, I'm pleased to report that we exited 2021 with residential gross margins greater than $0.70/W at 25.6%, up 100 basis points year-over-year. We are very excited and optimistic about the opportunities in front of us, and we remain committed to reinvesting the proceeds from the sale of Enphase shares and our C&I Solutions business back into the execution of our strategic plan. Please turn to Slide 11. We're providing guidance for 2022 adjusted EBITDA in a range of $90 million-$110 million. Relative to our prior color for 2022, the midpoint represents a reduction of approximately $35 million, with $15 million coming off as a result of our plan to exit the light commercial business this year. The remaining $20 million impact to the residential business is primarily driven by our updated supply agreement with Maxeon as we accelerate the shift towards a more diversified customer offering and supply chain. It assumes limited customer price increases during the transition. The guidance continues to assume strong demand and is based on a projection of greater than 35% volume growth versus 2021 to a range of 73,000-80,000 new customers. Our projection for residential adjusted EBITDA per customer calculates to a range of $2,000-$2,400 per customer before product and digital OpEx investment. SunPower is nearing the completion of its transformation to a residential customer-focused renewables business. We are now firmly on a strategic path for rapid long-term growth based on a growing basket of products and service offerings to our customers. As such, we plan to provide annual guidance going forward for adjusted EBITDA customer growth and residential adjusted EBITDA before product and digital OpEx investment per customer. We think the valuation of a company is most easily and accurately determined by these metrics, which will also be based on customers rather than megawatts, an approach that makes more sense as we add more long-term customer value to the initial sale of a solar system. With that, operator, I would like to turn the call over for questions. Thank you, sir. As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, please press the pound key. Please stand by while we compile the Q&A roster. Our first question comes from the line of Sean Morgan from Evercore. Please go ahead. Hey, guys. Thanks for taking my question. You know, Peter, I think on the call you guys mentioned that you're leaning into the Blue Raven acquisition a little bit, and maybe that's a little bit in light of NEM3. You know, as you're obviously gonna be diversifying the portfolio away from California, what steps are you taking proactively to sort of, I guess, boost the growth that you're seeing outside of kind of that core, you know, historic base of your company? Yeah. Hi, Sean. Thanks for the question. You're absolutely right. We are looking to diversify the company across the country. What's interesting is if you take a look at the growth rate so far just in the first quarter of this year, we're growing very fast in California, but we're actually growing as fast in the rest of the country, particular strength in the Northeast and the Southeast. You might remember Blue Raven was sort of that sweet spot right in the middle of the country where we weren't, and Blue Raven will continue to expand and grow. We're gonna talk to you more about our Blue Raven plans at Analyst Day. We'll also fill you in at Analyst Day about how we plan to accelerate our growth both in the Northeast and the Southeast. The other interesting thing I'll highlight is it's not just solar panels. Battery storage, I think, is really beginning to take off, and I think we're quite pleased with how we've started the year with our SunVault product. You know, I think it's both a combination of the extreme weather conditions that people are seeing in different parts of the country and the power outages that are driving more and more consumer demand. You know, one of the things we measure and share with you guys in color is our attach rate. Our attach rate for SunVault was trending, let's say, 25%-28% in our direct channel last year. That's up to the mid-30s as of last week. What's interesting is the attach rate is just as high non-California as it is in California. as you could hear from our comments, we're extremely pleased with the sales that we're seeing, and we're so pleased to see that we're diversifying our sales base all across the country. Okay. That's interesting. You know, since you brought up SunVault and you've been able to sort of bring that back online and get past, I guess, some of the supply chain hiccups that you had previously. Now that you're sort of pairing that with the Wallbox and the potential for the bidirectional charging, are you seeing any trends in terms of attach rate on SunVault versus people with EVs that might be looking to eventually incorporate car battery storage as part of their home energy solutions? Anything interesting that you're sort of picking up? Yeah. I think, Sean, you guys have seen we've announced a couple of programs with new home builders. I think what I would predict is for this year this combination of solar plus battery plus EV will probably take off the fastest is with new homes. It kinda makes sense because most new homeowners roll their solar package right into their mortgage, which makes it very affordable, and that's the perfect time to kinda get all three done at the same time. We are excited to share with you coming up at our Analyst Day both our plans on the EV side and also some interesting plans related to battery storage with virtual power plants. Lots more to go there. I think the biggest thing that gets me excited about storage, coming back to SunVault for a minute, is that today we're really offering a product for partial home backup. It's the product I have at my house. I think it's terrific. I think if you take a look at the storage market, we're seeing a much stronger demand for whole home backup. We're gonna talk more about our SunVault plans, and we see you at the end of March. Suffice to say, we're gonna be aggressive at rolling out a number of new products in the whole home backup category, and that leads us to believe that this could be a terrific year on the SunVault side. Okay. That's great. Thanks, Peter. Thank you. I show our next question comes from the line of Pavel Molchanov from Raymond James. Please go ahead. Thanks for taking the question. Last December, you unveiled SunPower Financial, but I didn't hear a lot about that in your discussion of this year's guidance. Can you talk about how that new initiative fits into your revenue mix? Absolutely. Thank you for the question, Pavel. The hiring of Jason McGray has really allowed us to build out a proper financial products business. You know, the big goal that we laid out for you guys is that we're gonna improve the number of systems financed from 35% of the total to 45% next year. Maybe as exciting to me is we're building up a scale in both lease and loan that's gonna allow us to really lower our cost of capital over time. Maybe as exciting, and I can't wait to share this with you in more detail at the Analyst Day, is we're really building out the financial products for customers and dealers that will scale very, very well as our business gets larger and larger. We're quite excited about that part of the business. I think at the core of it's not only about making some money from helping customers finance their solar. When you take a look at customer research, the number one reason people say they can't get solar is they don't think they can afford the down payment. The number two reason they say they can't get solar is they don't think they can get approved for financing. We're excited to share with customers, you know, the new financial products we'll be rolling out this year and beyond that we think are gonna make solar accessible to, you know, 100 million people here in the U.S. Lots more detail to come, but we're very excited to share more detail with you on that at the end of March. Just to clarify, are you going to be putting solar leases and loans on the SunPower balance sheet as, you know, a number of the other major national rooftop providers are doing? No, we are not changing our strategy on that at all. We're still gonna move these leases and loans off balance sheet. That means that we don't take the risk. By actually beginning to do the loan servicing, which we plan to do this year, we'll have a much better understanding of what the real risk is, and we believe that would allow us to get a much lower cost of capital and a greater share of the economics over time. We'll walk you through that in more detail, but no, we're not changing our strategy in terms of loans on the balance sheet. Okay. Clear enough. Thanks. Thank you. Thanks, Pavel. Thank you. Our next question comes from the line of Brian Lee from Goldman Sachs. Please go ahead. Hey, Brian. Hey, guys. Thanks for Hey, guys. Good afternoon. Thanks for taking the questions. Maybe the first one just on these new metrics, right? I understand some of the rationale, but you know, given you're kind of you know, moving the goalposts a little bit, again, just wanted to dive in a bit. The adjusted EBITDA per customer, first one on that, I guess, can you kind of break out you know, as your customer mix is changing, you even acknowledge there's you know, more than solar-only customers going forward, you're gonna be selling a lot more services and other products. What's sort of the $2,000-$2,400 per customer range represent? Is that $2000 for a solar only and then at the higher end, you know, $2400 represents like a solar only or a solar plus SunVault battery customer? Just kinda give us a sense of the range of where your EBITDA shakes out on a, you know, individual customer basis because I feel like the blended mix kinda, maybe doesn't represent where, you know, incremental customers are really being sourced at in terms of your economics, and then I have some follow-ups. Yeah. Hey, Brian, it's Peter. Thank you. We are excited about the guidance that we're gonna give as we go forward. I think when you think about a direct-to-consumer residential company that's focused on growth, I do believe customers and customer growth and then something like EBITDA per customer or maybe someday we'll get to a lifetime value per customer, those are the two things to look at to really measure the health and well-being and the valuation of the company. Let me have Manu answer a couple of your questions on the EBITDA calculation and how we've been thinking about it. Hi, Brian. Just to contextualize the three metrics we're giving, we've provided the number of customers in the past. I think it's a much better metric than just the megawatts. That's what we've guided, and it makes sense given that we are, you know, resi-focused or resi-only company going forward. EBITDA per customer is the same basis as what we've talked about in the last couple of quarters. You can reference the total year to what we had said in the third quarter metrics as well. Just to answer the 2022 question regarding the EBITDA per customer, the assumption is that what takes it from let's say the low end of the range or the high end of the range is a solar customer, depending on region, as well as a solar customer who's also taking financing from SunPower. The range of 73,000-80,000 customers assumes customers that are gonna take solar, and then some of the customers are gonna take solar plus storage plus EV plus our financing. EBITDA is the same basically as last time. Okay, that's helpful context. I guess maybe as a follow-up to that, I may have the numbers off, but I think in the past you said, or, you know, last quarter you said, $35 million on, you know, this product and digital spending effort, that was the drag on EBITDA. If I do that across your customer base, I guess, or your customer count, it sounds like it's about a $400-$500 per customer EBITDA drag from those spending initiatives. Is that gonna be pretty constant going forward? Is there a reason to be stripping that out, I suppose, 'cause are those maybe essential to running the resi solar segment? Just trying to understand, you know, what that EBITDA drag is from that ongoing spend, and if it changes over time. Yeah. What we had talked in the fourth quarter was about $35 million of incremental spend that we were financing effectively through Enphase proceeds that we sold in the third quarter of 2021, just to tie the comment back. I think where it shows up is half of it shows up in the EBITDA per customer calculation, and then the other half of it shows up in the products and digital OpEx. The way to think about the spend from a SunPower perspective, whether it's on a per customer, I think, 2022 is a high watermark, and while we'll continue to spend on the growth of the business on a per customer basis, that spend is going to be tapering off as we go from 2022 to some of the out years. Yeah. I think what I'd add on that, Brian, is that, you know, from my time at Amazon, the two pieces of investment that scale the best over time are investing in software and investing in products. They're the kind of investments that once you make them, they'll scale over a larger and larger customer base over time. I just gave on the previous answer the example of financial products. A lot of what we're gonna build this year is what we need for the next 10 years, you know, and beyond. The $35 million number may, you know, it's possible that could increase in absolute terms, but I think as a rate of the total, you know, I think that'll scale nicely over time and begin to shrink over time. Thanks. Thanks, Brian. All right. Thanks, guys. I'll take it offline. Thank you. Our next question comes from the line of Philip Shen from Roth Capital. Please go ahead. Hi, everyone. Thanks for taking my questions. First one's on- Thanks, Phil. The 2022 outlook, and, you know, with 76,000 customers, how many of those are Blue Raven? I'm guesstimating 9,000 with the strong growth outlook for Blue Raven, but just curious if you can help us understand ultimately what the organic growth is. I'm guessing roughly 25% year-over-year, and then the impact of Blue Raven. Thanks. Phil, we don't break out Blue Raven customers separately, but I would say you're in the ballpark. I think that's pretty close to what the number will be. We do think about it constantly as our total direct channel, which includes SunPower Direct plus Blue Raven. We're very, very pleased with the growth and the profitability of that channel. To give you some color on that was let's say 15% of our business before Blue Raven, you know, became 20% by the end of the year, and we'll get to 30% of our total business this year. Not only is it growing a lot faster than our total business, but it's also a channel that's much more profitable for us. We're quite pleased, as I mentioned in my comments, with the Blue Raven acquisition and both as them running as an independent company and also our ability to find synergies between the two companies. It's been terrific so far. We're also very, very pleased with our SunPower Direct business. Great. Thanks for the color, Peter. As it relates to OhmConnect, can you talk a bit more about the revenue model there and the go-to-market strategy and what kind of impact to revenue margins could we see in 2022 and 2023? Do you expect it to be meaningful, or is it still kind of gonna be ramping from smaller numbers? Thanks. Yeah. Thanks, Phil. I'm so glad you brought up Ohm because I can't wait to spend time with you guys on this. It's a terrific partnership. I don't wanna give away all of the punch lines for our Analyst Day, but let me give you a couple sneak previews. First of all, there's a couple things about Ohm that we find really attractive. One is, for all the talk about virtual power plants, the hardest thing is getting the customer experience right. You know, if you think about the idea that you're gonna let someone else control your battery storage or someone else control your thermostat, that's not something that most people, you know, wake up every day and are comfortable with. They have really demonstrated, in our opinion, the ability to influence customer behavior in a very positive way, and we're gonna talk to you about that. Also, they're really the first company that we've seen that's been able to connect consumer energy with the energy markets, you know. There's a lot of talk about VPP, but when you actually take a look at who's made a direct connection to the bidding and energy between, you know, residential batteries, residential actions, if you will, and the energy markets, I think these guys are way ahead. We're gonna give you a lot more details at the Analyst Day about our partnership, but our partnership is a very big and comprehensive one. We're gonna be their exclusive partner on things like solar and battery storage, and I really wanna get into a lot more detail with all of you on our VPP investments and the seeds we're planting. To answer your last question directly, I don't think it'll be material in 2022. I think it's early. There's still a lot for us to figure out, but I will tell you that it's one of these seeds that is exciting because if you you know took a look at the three-year plan and the five-year plan, I think it does become a very material part of our business. You know, the economics are really attractive. Frankly, I've been looking for an opportunity for us to work productively with utilities. I mean, this is a win-win-win if we can get the consumer behavior right. Consumers get money from it. Utilities hopefully save having to build new distribution because they can take advantage of distributed energy storage. We think we can be a partner to both and participate in the economics. I look forward to going a lot deeper on that topic with all of you in about a month. Thanks. Great. One last one, if I may. In terms of the Enphase partnership, there might be some near-term deadlines there in terms of how things are governed. What do you expect there? Do you have any real alternatives besides Enphase if you wanna go a different direction? On the Enphase partnership, we have a partnership agreement that we're together through Q1 of 2024. We're pleased with that agreement. We're pleased with the relationship we have with them. I think it's business as usual for 2022. Great. Thanks for taking all the questions. I'll pass it on, Peter. Okay. Thank you, Phil. Thanks, Phil. Thank you. Our next question comes from the line of Kashy Harrison from Piper Sandler. Please go ahead. Good afternoon, everybody, and thank you for taking the questions. On Slide 11 of the investor deck, you indicate the guidance excludes the outcome of NEM and potential ITC changes. I was wondering if you could maybe just help us with some sensitivities on those numbers, if the proposed decision from December comes to fruition. In addition, can you also provide us with some sensitivities, if the ITC changes? Yes. Let me, before I turn it over to Manu for the sensitivities, let me just make a quick comment on both. I think, you know, as the initial negative news came out on California NEM in December, we did believe that that was gonna be, probably an overreaction in the market, and I think that's proven out to be the case. As the events have taken place since, you know, there's an enormous amount of energy from California residents and California employees in the solar and renewable energies business to make sure that the outcome here is much more moderate and much more favorable for the solar customers and the solar employees. I would just tell you that in California, we're cautiously optimistic that the outcome here will be much improved over the initial reports and that we'll have an outcome at some point in Q2. Then on the ITC, before Manu goes through the sensitivities, I think we feel in a similar direction. I think you've seen comments from Senator Manchin that he supports legislation related to climate and clean energy provisions. There seems to be a lot of support across the Democratic Party for that in the Senate. We're cautiously optimistic that that will get moved along over the next few months. Manu, you wanna talk a little bit about the sensitivities on the NEM and ITC side? Yeah. On the ITC, Kashy, we actually covered that in our last earnings call, and I think the way we articulated it is we should see the benefit, either from a pricing perspective or increased volume. I think we calculated using certain growth assumptions about a $14 per share benefit to SunPower. We can go into a lot more detail on the callback if you like. On the NEM sensitivities, if you have that? I think we look from a NEM perspective. I don't think we've articulated any sensitivities in the past. I think like what Peter said, you know, we think we'll all get into the right place from an industry perspective and the policymakers. I think as the policy unfolds, you know, we may see some near-term demand, but I think it's a bit too premature at this point to provide any sensitivities there. Okay. As my second question, on sticking with Slide 11, you indicated that the decline in adjusted EBITDA per customer in 2022 was driven by higher sales and marketing in the footnotes. I was wondering if you could just maybe give us some medium-term targets on where you think this estimate could go, thinking through, you know, maybe rising storage attachment rates, and then also the transition from 35% loan origination to, you know, where that might go in a few years. Thank you. Yeah. I think the way to think about it. Let me take a step back, right? As we've exited 2021, you've seen two things. One, the resi fundamentals continue to be amazing for us, which kind of, you know, leads into the focus on that business for us. You can see that in gross margins, you can see that in bookings. We are seeing that the top of the funnel is extremely strong. The investment in sales and marketing expense, to contextualize, is both to grow geographically as well as, you know, helps with broadening our product portfolio more of it fits in on the Analyst Day, right? In terms of from a modeling perspective, as you bridge from our current guidance to where it could go, a couple of things that will provide tailwinds. One is increased financing. We've talked about every customer that buys a system and a finance system compared to a non-finance is about $1,000 a customer, so that should bring the overall margin up. Storage attaches as they increase and as the business ramps, or that part of the business ramps, that should be incremental margin to the EBITDA per customer. As well as the EV attach rates. All those three things should increase the EBITDA per customer going from 2022 to 2023. As Peter and I talked about earlier, some of the investments we're making in the platform and growth in 2022 should start to taper off on a per customer basis, and then the volume leverage really kicks in as you go from 2022 to the out years. Yeah. The only thing I'll add is on where do we go after 45%, two things for context. One is we're still the only solar residential solar company that offers all three financial options. For customers, we want them to make the choice that's best for them, and that could be cash, lease or loan. Of the customers who prefer not to pay cash, which is still the majority, we are on a path to have 100% of that business financed by us over time. The 45% that we're at for this year is just the beginning in the way we look at it. Obviously, we're getting 100% of our own direct channel today, but as Jason and his team have a chance to build out some world-class financial products for our dealers, I think we see the opportunity accelerating as we go. Thank you. Thank you. Our last question comes from the line of Tristan Richardson from Truist. Please go ahead. Hey, I appreciate the comments this evening, guys. Just one on the EBITDA as well as customer growth guidance for 2022. Does that include the impact of the previously discussed kind of connectors charge that occurs in 1Q as well? And then also the factors you talked about impacting 4Q, namely the push out into 2022 from weather. Is that included in that guidance, both on a customer and EBITDA basis? The answer is both are included. Okay. Okay, helpful. You know, maybe just a quick one to follow up on the light commercial exit. Is there any change to sort of a, you know, cost structure from an OpEx perspective going forward? You know, savings harvest, et cetera, changes to, yeah, overall cost structure by exiting that piece of the business. Well, you know, in C&I, most of the employees we've had working on C&I were shared between our residential business and C&I. To give you a quick direct answer to your question, no, I don't see a big OpEx impact. We have a small single-digit sales team that'll be impacted, but I think most of the employees will reallocate to this faster-growing and more profitable residential business immediately. Helpful. Appreciate it, guys. Thank you. Thank you. I guess as we wrap up for today, I wanna thank everybody for their questions, and I just have two quick closing comments. One of them is, I just wanna recognize that we've now fully made this transition from a company that was in a lot of different businesses, panels and utility scale solar and commercial and industrial and residential, to a company that's now solely focused on the residential solar business as we go forward. When I took my first earnings call last May with many of you, most of you had a very similar question, which is, What are you gonna do with the commercial business and the C&I business? We've now successfully answered those questions, and now you can see our strategy of where we're headed as we move forward. We are extremely excited to host all of you, March 31st in San Diego for our Analyst Day. This will be my first chance to interact with all of you and for you to meet our team. Let me just give you a quick sneak preview of some of the topics that we plan to talk about. First of all, we have a very exciting product strategy, and that includes the opportunity for us to participate in a segment of the business that we've never participated in before, and that's the mainstream or mass market panel business. Our existing supplier arrangements have only really allowed us to participate in the premium segment. We are extremely excited as we move forward to finally have a product in the much larger and faster-growing mass market segment. If you talk to our dealers, it's the number one thing they bring up when I talk to them. We're very excited to share our plans with you on that. Two, we're gonna talk to you, as I mentioned, a lot more about financial products, but we're also gonna talk a lot more about what are the things that we're gonna do to drive lifetime customer value up over time. That includes many more products on the battery storage side, exciting opportunities for us on the EV charging side, and a discussion that I can't wait to have with all of you about our approach in virtual power plants or VPP, including our partnership with OhmConnect. Finally, I'll just suffice to say, as we've started the year, we're seeing tremendous growth in the upper part of our funnel. If you said to me, what's the best leading indicator of the health of this company and this business, it's always that upper part of the funnel. We've committed in our guidance for 35% customer growth this year, but I will tell you right now at the top of the funnel, we're seeing, you know, 3x that growth in things like raw appointments and marketing qualified leads. The other interesting thing is that we're seeing much higher close rates than we did a year ago. Those are both very good leading signals about where this business is headed. Thanks to all of you, and look forward to seeing you March 31st down in San Diego. Thanks. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.