Thank you for standing by, and welcome to Symbotic's first quarter fiscal 2024 financial results conference call. At this time, all participants are on a listen-only mode. After the speaker's presentations, there'll be a question and answer session. To ask a question at that time, please press star one one on your telephone. Please be advised that today's call is being recorded. At this time, I'd like to turn the call over to Jeff Evanson, Vice President of Investor Relations. Please go ahead. Thanks, Val. Hello, everyone. I'm Jeff Evenson, Symbotic's VP of Investor Relations. Our press release and discussion today will include forward-looking statements based on assumptions that are subject to risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements, including as a result of the factors described in cautionary statements and risk factors in Symbotic's financial release and regulatory filings with the SEC, by which any forward-looking statements made during this call are qualified in their entirety. In addition, during this call, we will discuss certain financial measures that are not recognized under U.S. generally accepted accounting principles, which the SEC refers to as non-GAAP measures. We believe these non-GAAP measures assist management in planning, forecasting, and evaluating our business and financial performance, including allocating resources. Reconciliations of these non-GAAP measures to their most comparable reported GAAP measures are included in our financial press release, which is available in the Investor Relations section of our website and is on file with the SEC. These non-GAAP measures may not be comparable to measures used by other issuers. Today, we'll provide guidance for the first quarter, including revenue and Adjusted EBITDA. We're not providing guidance for net loss today, which is the most comparable GAAP financial measure to Adjusted EBITDA. We're not able to provide reconciliations of Adjusted EBITDA to GAAP financial measures because certain items required for such reconciliations are outside of our control and/or cannot be reasonably predicted, such as the provision for stock-based compensation. On today's call, we'll be joined by Rick Cohen, Symbotic's Founder, Chairman, and Chief Executive Officer, and Carol Hibbard, Symbotic's Chief Financial Officer. These executives will discuss our first quarter fiscal 2024 results and our outlook, followed by a Q&A. With that, I'll turn it over to Rick. Rick? Thank you, Jeff. Good afternoon, everyone. Thank you for joining us to review our most recent results and discuss the year ahead. In our first quarter, we reported strong financial results and posted equally impressive operational results. Our team set a new deployment record, completing the full build, installation, and commissioning process for an entire Symbotic system in only 20 months. While we can't currently deploy all systems this quickly, this reflects the deployment speed improvements we are making, and we are focused on further reductions in deployment time as we build capacity to support growing customer demand. One such improvement is SymBot. The mobile bot is now well established as our platform workhorse. SymBot has the newest NVIDIA chips with an enhanced version of our automation software that is powered by artificial intelligence. While SymBot can perform more transactions per hour and has improved reliability over our previous generation bot, SymBot will also improve our ability to deploy systems more quickly and efficiently with even higher customer ROI. SymBot also helps extend the capability of our system and sets the stage for our entry into new markets, such as non-ambient food. Turning to BreakPack, our development of BreakPack progressed faster than expected over this past quarter and has advanced beyond the prototype stage. While we are always refining all our products, BreakPack is now ready for general availability to our full range of potential customers. Turning to our joint venture, GreenBox is receiving a lot of inbound interest, so like Symbotic, GreenBox is being selective in choosing the right customers to work with. GreenBox will share more about their roadmap when they announce their first customer, but we expect to be recognizing our first revenue from GreenBox in fiscal 2024. In summary, our story is unchanged. We will continue to innovate, execute, and scale to deliver for our customers as we grow and drive increased profitability in a capital-efficient way. Now, Carol will discuss our financial results and outlook. Carol? Thank you, Rick. I've enjoyed an exciting first 90 days here at Symbotic. During that time, we've enhanced the capability and scope of the entire Symbotic team to scale for the future. For example, we successfully implemented SAP software across the company, which helps with everything from scaling to Sarbanes-Oxley compliance. Our first quarter revenue grew to $369 million, up nearly 80% compared to the same quarter last year, and reflects an accelerated pace of growth from last quarter's 60% year-on-year growth. This was driven primarily by scale and the increasing number of systems we have in deployment. During the first quarter, we initiated five new system deployments and completed three as we continue to add both new customers and additional projects for existing customers. So at the end of Q1, we had 15 fully operational systems and 37 systems in the process of deployment. This is an increase from 12 operational systems and 35 deployments in progress last quarter, and eight operational systems and 22 deployments in progress in the first quarter of last year. While we have temporarily stabilized the pace of system deployment starts, our future revenue growth is really driven by our ability to scale deployments in progress. Continued reductions in system deployment time, as demonstrated by the system we recently deployed in just 20 months, leaves us well positioned to support customer demand. It is important to note that as we scale, our customer base is becoming more diverse. The 37 deployments in progress are with six of our nine customers. We continue to standardize our system platform and identify opportunities to further streamline our deployment processes. To that end, our network of outsourcing partners is executing well. We continue to see significant opportunities to gain efficiencies over time and to build capacity as we continue to add partners to our outsourcing network. Our backlog remains stable at $23.2 billion and now reflects the addition of Southern Glazer's, who became a customer in November. Our recurring revenue streams grew 5% sequentially and 45% year-on-year. Adjusting for our 53-week year in 2023, recurring revenue streams reflect nearly a 12% sequential growth, but still below the 25% sequential increase in completed systems, because these systems were completed in the back half of the quarter. So we expect accelerating recurring revenue growth as we head into our second quarter. Gross margin increased sequentially by 90 basis points to 20%, driven primarily by improvement in system gross margin. While we do not expect gross margin to improve every quarter, we do expect it to improve each year well into our future. Our first quarter non-GAAP system gross margin increased 110 basis points from last quarter. As a reminder, these results still reflect significant costs associated with lower-margin innovation projects like BreakPack, the burden of pass-through costs that protect gross profit dollars but can weigh on our reported gross margin percentage, and costs associated with rapidly scaling our operations. Our recurring revenue streams again contributed to positive gross profit. This demonstrates the high leverage in our business model, showing that we can be profitable with such a small number of active sites with recurring revenue, while also being invested for the much larger number of systems still in deployment. We continue to expect that as we scale over time, that recurring gross margins can trend to over 60%. Operating leverage improved again sequentially as we achieved a 3.8% adjusted EBITDA rate, compared to a 3.4% rate last quarter. This was driven by our rapid revenue growth and gross margin expansion, along with stable operating expenses. Our cash and equivalents, including marketable securities and restricted cash, grew $129 million sequentially to $677 million. During the quarter, Walmart exercised its last remaining warrants at $10 per share, adding $159 million to our cash balance. Excluding the warrant proceeds, this total would have been $518 million, reflecting a $30 million use of cash in the quarter. As the working capital benefits of 2023 temporarily reset, we expect cash to decline slightly again in the second quarter before we return to working capital expansion in the back half of 2024. For the second quarter of fiscal 2024, we expect revenue of $400 million to $420 million and adjusted EBITDA between $12 million to $15 million, which represents revenue growth of over 50% and improves adjusted EBITDA margin of over 700 basis points, both on a year-on-year basis. We now welcome your questions. Operator, please begin the Q&A. Thank you. Again, ladies and gentlemen, if you'd like to ask a question, please press star one one on your touchtone telephone. Again, to ask a question, please press star one one. One moment for our first question. Our first question comes from the line of Piyush Avasthy. Your line is open. Good evening, guys. Evening. I think, s orry. I think for the second quarter guidance, it, you know, the implied EBITDA margin is modestly below from what you did in Q1. Maybe some color on what is impacting margins in this quarter. And taking a step back, I know you don't give full year guidance, but when do you expect a more meaningful sequential improvement in margins? Thanks for your question, Piyush. Our guide for the second quarter reflects our flexibility to accommodate increased spending, if needed, as we need to accelerate deployment schedules and ensure we have a high-quality deployment with as little disruption as possible. Ultimately, the customer satisfaction of that quality system rests on Symbotic, and so as we continue to ramp, we're going to deploy resources as necessary to ensure we meet that schedule. So that's what we're seeing for the second quarter. And in terms of the longer-term profitability, we continue to be on a trajectory to improve, and you're going to see that start to improve in the second half of the year, and year over year, continued improvement in our profitability. Got it. Helpful. And, Rick, I think you talked about BreakPack being available as a standalone product now. Maybe, like, talk about the target customers here, and how have the initial conversations been? Yeah. So, the target customers for a BreakPack operation like that would be, typically, what you see in BreakPack is customers that are in the drugstore business, which is obviously a big market. And the original BreakPack that we designed for Walmart was really, if you think of it, there's 4,500 supercenters, and there's 45 drugstores within a Walmart supercenter. So these would be, some of the customers that would logically look at a system like this. Smaller store formats, smaller customers would be interested in BreakPack, and also people with a long tail of slow movers that might be interested in shipping each as opposed to cases. So we think it's a very big, customer base. We're not, we're not actively, selling the BreakPack right now, but we've finished the prototype. It's no longer a prototype, and so, as we get more and more comfortable with it, we will begin to market it as an add-on product to our basic product. Got it. Very helpful. Appreciate the color there. Thank you. One moment, please. Our next question comes from the line of Ross Sparenblek of William Blair. Your line is open. Hey, guys. Thanks for taking the question. Hey, Ross. Hey. Maybe on the, the supplier network, I know you guys noted that, you know, you're still adding suppliers. I thought we were kind of through that dual sourcing that would then begin to allow you to start, you know, alleviating some of the, inventory challenges and bringing down those lead times. Can you just provide any update as you know, think of the timing around that? Yeah, I've spent a lot of time with suppliers. What we're seeing is better inventory, higher quality products coming from our suppliers, which means that we're actually pushing the suppliers to do a lot more testing in their factories as opposed to on sites. And as a result, you'll see the implementation time for our systems faster, which is why we mentioned the fastest that we've done yet. This was completed this past quarter, and when we turned it on, it was above customer expectations for quality. So what we're seeing from suppliers now and what we're working at is the suppliers now understand how real we are. There's a lot of interest from suppliers. They're more price competitive. They're more willing to invest in quality. So I think we're past the struggles to find good suppliers, and now we're working with more good suppliers to be higher quality and more competitive. So I think we are in a good place with suppliers now. Yes, so Ross, I'll just add to that. If you think about 2023, it was really focused on getting those partners, and so there was probably a more substantial growth in terms of the number. Now we're tweaking because we do need to continue to scale, and as Rick indicated, we now are coming in with a lot greater scale and suppliers are more interested. And so in 2024, as we focus on that, we're also focused with our suppliers on ensuring we're gaining those efficiencies, and we're going to start to see the benefit of that. Okay, got it. And then maybe just thinking about, you know, new customer mix as we move through the year. Can you just, you know, maybe help us, you know, better understand what the deal was? And then also, of the five additions, what would have been, you know, kind of customers outside of Walmart? Yeah. So out of our new customers, so as we indicated, we had five new systems in this quarter. One of those was Southern Glazer's. So we announced in November, we had the addition of Southern Glazer's, so that's our new customer out of that mix of five. The other four were additional statements of work for existing customers. So I think that was your first question on the new customer mix. Ross, can you go. Y ou had another part to that. Can you- Yeah, just understanding what the, you know, steel impact was. I know it's been pretty, you know, variable quarter to quarter here. Yeah. So, in our contracts, we have pass-through cost clauses that help us see that fluctuation of steel. We actually saw the benefit for steel fluctuation early in the year, and now we're looking at headwinds as we head into 2024, and steel, seeing that fluctuate. But I will emphasize, our contract structure allows us to have some of those costs as pass-through. But we continue to monitor that and ensure that we're getting out ahead of it. Got it. So maybe just real quick, we think about the 90 basis points of sequential margin expansion with steel, maybe half of that? No, steel would not have been that big of a contributor to that margin expansion. Okay. Yeah. Perfect. Thank you, guys. Okay. Thanks, Ross. Thank you. One moment, please. Our next question comes from the line of Matt Summerville of D.A. Davidson. The line is open. Thanks. A couple questions. I was wondering if you could maybe take a second back to s ome of your prepared remarks just regarding SymBot, can you maybe review with us some of the KPIs, if you will, around SymBot versus, you know, prior, you know, the next closest prior generation? Trying to get an understanding for, you mentioned more transactions an hour. If you can kind of put some numbers around how SymBot is differentiated versus your legacy gen robots. So the first thing that we did with SymBot is it can actually, and this may be one of the most important things, it can actually handle a tote, a tapered box, and our original bot could not do that. So that was one of the first things that forced us to relook at long-term flexibility of a SymBot. So that part didn't actually help us go faster, but it gave us a much bigger universe of products that we could handle. Most of our competitors might do trays or something else, so we have a lot more flexibility on what size and shape of packages we can handle. The second thing that SymBot did over what we call Bot X was it has vision. And in order to put in vision, we needed graphic interfaces, and so we upgraded to NVIDIA chips and their vision and graphic interface boards. And so that, that allows us to actually see boxes that in the past we couldn't see. Third thing is, we can pick and place packages 10 seconds faster than we could with the original bot. So those are some of the other things that we did. And then the last thing is that we can now actually, on this bot, pick up. On inbound, we always were able to bundle and deliver two or three cases at a time. Now, for the first time on outbound, we can handle more than one box at a time. So I won't give you all a lot of numbers because some of the stuff is still proprietary, but you get a sense this bot is. I would say the upgrade for this bot would be from a motorcycle to an SUV. Super helpful there. Thanks, Rick. And then as my follow-up, you kind of talking about BreakPack generally available, not really actively selling it yet. I'll ask same question along the lines of, of GreenBox. Do you expect BreakPack to start to contribute to revenue in fiscal 2024? And then when do you see Symbotic starting to attack the non-ambient market per one of your other prepared remarks? Thank you. Yeah. So, BreakPack may have impact in 2024, right at the end of the year. So in the last quarter, if it does, because of just the cycle of selling, and, so that would be one. Ambient, we're actually piloting some perishable testing in a perishable warehouse as we speak. So I think that could be, I would say, probably not this year, but I would say twelve months from now, just from the cycle. But we will be able to have, we will be able to offer perishables, and then after that would be frozen. But the first go-around would be stuff like dairy, produce, and meat, which is around 32 degrees. Then after that, we would develop a system for minus 20. And then, Matt, I'll just add to that. BreakPack, our proof of concept, is already contributing to revenue this year and has been over the past year. Yes. And so our product type that we have in flow is also, is already a revenue contributor. Now, in terms of what we're able to add to that as we continue to offer it, you'll see that grow as we expand that at the end of 2024. Yeah. Understood. Thank you. I was aware of that, but thank you for, y es, thanks for clarifying. Yeah. I should have stated it a little differently. Thanks, guys. Thank you. Thank you. One moment, please. Our next question comes from the line of Mark Delaney of Goldman Sachs. Your line is open. Yes, good afternoon. Thank you so much for taking the questions. If I heard correctly, Carol, you mentioned stabilizing temporarily the number of system starts. And if I heard that correctly, I'm hoping to better understand the thought process and how you're thinking about managing the company operationally, you know, especially with the company adding more outsourcing and manufacturing partners. I would have thought there had been some potential to increase the number of starts the company was doing. Yeah, and you'll see that. Thanks for the question, Mark. You'll see that by stabilizing. So last quarter, we introduced four new systems into the quarter. This quarter, you're seeing five. By stabilizing, we're indicating don't expect that to continue to grow to six to seven to eight every single quarter, but we will see improved number of systems as we grow over the next couple of years. When you think about what we already have in our backlog, the other comment related to that stabilizing is you're going to start seeing us delivering on our systems with the backlog that we currently have. So we're gonna continue to ramp the number of systems that we turn operational every quarter, and then the number that we continue to add from either new customers, expect a new customer, one to two every year, as we've indicated in the past, there's really no change to that. And then as we expand into GreenBox, into 2024 and 2025, I think that's when you'll really start seeing the additional ramp. Understood. That's very helpful context. In the first question about the EBITDA guidance, you mentioned the guidance assuming the ability and flexibility to deploy resources to support customers. Just wanting to better understand what you meant by that, and is there something with just some of the more recent projects that's been more difficult? Or, are you more alluding to you're supporting some newer customers and just wanting to make sure you have the capability to support them in the event that is necessary? Thank you. Yeah, thanks for the follow-up. So in terms of our guide, when we talk about wanting the ability to deploy on schedule, as we are now in the stage where we have 37 different projects in deployment, so that's up from 22 a year ago, and so we are scaling right now. And what we wanna make sure we do is that we adhere to schedule and that we're able to deliver that high quality. So if that means providing a few additional resources or taking a week or two longer to go ahead and deliver, that's what you're gonna see in some of what I'll call the lumpiness in the next quarter around both revenue and in our margin. Okay, thank you. We don't wanna do anything short-sighted to save a few points on margin that will help us in the long term. Understood. Thank you very much. Thanks, Mark. Thank you. One moment, please. Our next question comes from the line of Nicole DeBlase of Deutsche Bank. Your line is open. Yeah, thanks for the question, guys. Good evening. Maybe just starting with R&D, it's been on a bit of a declining path for the past few quarters. I guess, why is that? And then, what is the outlook for R&D expense over the next several quarters? Thanks, Nicole. So on R&D, I think what you're seeing from when you compare fourth quarter to first quarter, is that additional week that we talked about. So in the fourth quarter, last year, we had a 14-week quarter versus a 13-week quarter, so we had an extra week contributing to R&D. So that's a little bit of the fluctuation from fourth quarter to first quarter. I would expect our R&D to continue to ramp modestly throughout the course of the year. But what we do wanna make sure we do is we're looking at multiple innovation projects, and so we want to maintain the ability to ramp our R&D if those innovation projects come to light, and we want to expand that at the back half of the year. So I wouldn't, I'd expect moderate growth, but we are looking at projects that not only drive innovation, but we're also looking at projects that drive improved efficiency, that would help improve our cost structure, as well as the operational efficiency on the end customer, for the systems that we deploy. Got it. Okay, that's really helpful. And then, when you spoke about getting to one deployment in the 20-month zone, I guess, what would be the long-term goal of the length of deployment, you know, once you feel good about the whole process? Thank you. So I'll start, and then Rick can chime in, in terms of long-term vision. As we've talked about in the past, we expect that 20-month cycle over the long term to get down to 12 months or lower. So and we, we've talked about the things that we need to put in place to be able to go do that. So that's from a long-term perspective. I think one of the other things to think through is what really enabled that 20 months. That might be one of the questions so that we can make sure we're, we're looking at how do you enable that going down to 18 months and then to 16 months. So a couple of things enabled us hitting that achievement this quarter. One was we now have continuous learning over multiple deployments. So our outsourcing partners, they've now got multiple deployments under their belt, and they're improving on each one. We've also got increased collaboration from our entire deployment team. So our deployment team includes Symbotic resources, our suppliers, as well as our customer, and we've really seen an increase in that collaboration over the past quarter. And then the last one is the quality and standardization of what I'll call the build. So our build instructions, our test procedures, we're standardizing that more and more from deployment to deployment, and that's really enabling the improvement from our partners. Thanks. That was super helpful. I'll pass it on. Thanks, Nicole. Thank you. One moment, please. Our next question comes from the line of Chris Snyder of UBS. Your line is open. Thank you. I wanted to follow up on the communication earlier around accelerating or picking up growth investment to drive or to help facilitate the accelerated growth. And when we look at OpEx, you know, over the last four quarters, OpEx has generally been sideways, and the number of projects in process and the revenue has gone up 40%. So I guess, you know, is there something that's happening now that's causing this, you know, the OpEx needing to pick up into Q2? Because we've seen so much growth already without that. So kind of I guess the question is: Why now? Yeah, we continue to modulate our OpEx because we're getting better on that spend. So what I think you're gonna see the improvement on that is where we'll continue to grow OpEx, but it's not gonna grow nearly at the same level as of our revenue, because we're also getting improvements on our spending as we do that. Okay, fair enough. And then, I wanted to talk about or follow up on the non-ambient food opportunity. Just specifically, if we think about, you know, the existing customers that the company has, is there any way to frame the size of the opportunity from non-ambient food with those existing customers? And then also, when we see the Walmart backlog, does that include any revenue for systems related to non-ambient food? Thank you. The Walmart backlog does not include any systems that are non-ambient. So obviously, and none of our other customers, whether it's C&S or UNFI, also, there's no-- we're selling non-ambient. But in the future, we'll be able to, and we think that's a big market. It's a slightly different market because there-- this is a market where and when we're focused on ambient, we're really focusing on one, we can obviously build pallets, but building in a perishable warehouse, the space is just so expensive. We're actually working on increasing the density of our system, which may help us across a number of areas. But it's, I can't give you a number for the market, but it's a big market. Thank you. Thank you. One moment, please. Our next question comes from the line of Jim Ricchiuti of Needham & Company. Your line is open. Hi, thank you. Rick, question just on BreakPack. You alluded to the drugstore business. How important is it to you to get a use case outside of your large customer for BreakPack in a market like that? Oh, it would be great. I mean, we're, t hat's one of the things that I spent a lot of time on, is figuring out who are the best use cases, who are the logical customers for what we're doing. And one of the things that we find, and we've been pretty busy, so we haven't been doing a tremendous amount of marketing because we're very focused on delivering for the customers we have in place. But, one of the things that we do when we bring a new customer to the market to see a site, is many times their response is, "I didn't even know this was possible." So that's why we're very, very focused on delivering on time, delivering with a braggingly happy customer expectation. We're gonna focus on that for the rest of this year. As we get better, then we'll have braggingly happy customers. Then the stuff that we're doing, that people have said, "I've never seen this before," gives us instant credibility, and I think that makes it very easy for us to expand our market. Yeah. The follow-up question is just going back to that 20-month deployment that you achieved. You know, as you bring on more partners, outsourcing partners, it sounds as though there may be some fits and starts, and that we're gonna see this move around. It's not going to be o r tell me if we're gonna see, you know, consistent progress on this front. It just seems like as you bring on new partners, it's gonna bounce around a bit. No, I don't think that's—we don't think that's gonna happen. We are now... When we started the outsourcing process, I think our team was smart enough to say, "If there's a better way of doing this, then show us." What we've been doing for the last year now is we're asking people to build to print, which is the expression they use. So you don't change our design. If you wanna talk about an improvement, that may happen a year from now, but we're really working very hard to standardize our design, which speeds up the implementation, which simplifies the programming, the programmable logic they call it PLC code that goes into our machines. So the ability to replicate what we do at the very highest level is what we're focused on. So, no, I don't think you will see... I mean, I think we had a lot of learning last year, and I think we talked about that openly. I don't think you're gonna see that again in the future. Good. Thank you. Thank you. One moment, please. Our next question comes from the line of Ken Newman of KeyBank Capital Markets. Your line is open. Hey, good morning. Or hi, good afternoon, I should say. Good afternoon, Ken. Yeah. Thank you. Carol, curious if you could just dig down into the comment about the increased spending to service, you know, the higher growth in the second quarter. I mean, when you think about that, is the biggest bottleneck there to service those deployments, is, is that just in-house engineers? Is it the third-party supplier base? Just any color there to kind of help us bucket that, that headwind? Yeah, it’s a mix. Thanks, Ken. It’s a mix of—I wouldn’t say it’s mostly engineering, because our engineering folks are focused on the R&D part of the business, and less of that goes into our costs. But it’s the operators, and it’s the folks we’re putting on site for that final stage of commissioning and deployment to ensure we’re hitting the reliability. And that includes some of our outsourced, so you referred to it as suppliers, so that would be their spend as well. Okay. And then, of course, you know, just wanted to get a little bit more color. I think you mentioned working capital expansion in the second half. You know, obviously, we saw a big ramp in accounts receivable and maybe prepaid expenses this quarter. I'm guessing that's from Southern Glazer. But just any color on what drives the working cap expansion for the second half, and just how confident you are about op cash or free cash getting better into the back half of this year? Yeah. So, so as most of you know, over the course of our deployment, our cash inflows tend to be very front-loaded, and so that's driven our favorable cash flow as we've ramped. But then, in any particular quarter, depending on the maturity of that particular deployment, we might see a higher cash outflow. So as we're ramping to having 37 different deployments in flow now, as we're heading into this quarter, we're going to see higher cash outflow in the second quarter, similar to the first quarter. What we're expecting for the year, excluding the warrants exercise, I'd expect our cash to be flat. Got it. Thanks. Thank you. One moment, please. Our next question comes from the line of Joe Giordano of TD Cowen. Your line is open. Hey, guys. Can you hear me? My phone seemed to, like, break up a second there. Yeah, we can hear you, Joe. Okay, great. So I preface this by saying it's a high-class problem, but you guys delivered revenue at, like, the high end, basically of what you said you would. But it's, to be fair, it's the first time you haven't, like, pretty easily gone considerably ahead of the high end. And I just want to, like, i t's a little bit of a tough question, Carol. I know you just, you haven't been there for those prior quarters, but is it, you know, was there a need to be more conservative with guiding back then because you had fewer projects under that were in deployment and, you know, was more variable by nature, and now you have more kind of precision around the guide because you have more projects to, like, you know, limit the inherent volatility there? Yeah, you're exactly right, Joe. So as we scale, and we have more and more systems in progress, the variance on a single project, we're not going to see that have as much contribution to an individual quarter's revenue. So before, when we had fewer projects, if you had one project either complete a month 30 earlier or complete a month later or even a week here and there, it was really driving the variation in the revenue. And as I indicated just in the opening remarks as well, we've deployed SAP, and some of the controls we're putting in place should help us standardize and drive our ability to tighten up that prediction range. Okay, that's kind of what I figured. And your commentary suggested that the, you know, you put in 5 into production this quarter. Sounds like it'll be give or take that level for a bit here. You know, I know, like, if you models have, have that ramping, you know, pretty, pretty large at some point, we could debate exactly when that starts. But I just want to make sure I understand, like, what is, i s there anything that's specifically not allowing that amount to be significantly higher right now, or is it just subject to, like, the scheduling of your large customers? Like, if your customers wanted that to be, you know, 15 next year, is that, like, theoretically possible right now? So, I'd say you're spot on. Our ramping of additional customers, we've indicated one to two a year, and that is metered by our ability to want to provide excellent customer service and satisfaction to the backlog that we have. And so we don't want to continue to take on more and more statements of work and additional customers and not have the ability to deliver on the $23 billion backlog that we have. Okay, and then one for Rick, if I can. Rick, you going through the SymBot characteristics there, I'm just curious, like, when you now have the ability to handle multiple boxes at one time on the outbound, like, does this ultimately allow you to accomplish the system with fewer bots? And is that kind of going to be somewhat required as you move into non-ambient, where, like, as you said, the facilities are smaller, and you probably need to get, like, more bang for your buck from a square footage standpoint? And is it? Does that whole dynamic lead to, like, any sort of difference in margins that you think you'd be able to get? Or is it better or worse, equal, versus, you know, what you've been doing on at scale? Thanks. Yeah. So, I can honestly say everything we're doing is trying to increase our margins. We're not doing anything, like, consciously to decrease them. But, seriously, the journey that we're on with the SymBot, we expect that we will be able to run systems with less bots because they will be more capable, faster, be able to do more work, and that's the journey that we're on, and that will only increase margin. The other thing that that will do is it would allow us to do a smaller system, because we could sell—we could use less bots because they're more capable. So that would allow us to, on the low end, hit a new price point, which is one of the things that I'm very focused on. I love having these big, big customers, and I love having these big sales, but if we could sell a smaller system with a lower price point and still increase our margins, that's an even bigger market than we're talking about right now. Yeah, absolutely. Okay, great. I'll pass along and jump back in queue. Thanks, guys. Thank you. One moment, please. Our next question comes from the line of Greg Palm of Craig-Hallum. Your line is open. Hey, I think I heard my name, but something cut out. In terms of GreenBox, I was hoping to dig into a little bit more on the deployment schedule. Rick, I think you said deployments or maybe initial rev rec in fiscal 2024, so I'd like you to confirm that if possible. But how do you think about the ramp-up of deployments specific to GreenBox? And just in terms of, you know, aggressiveness, is it dependent on, you know, customer announcements or sign-ons, or how are you thinking about that over the coming years? Well, the answer, do it in parts. So we've been talking to some large customers and large suppliers about the opportunity. And so I think what will happen is that GreenBox will start off slowly and then go very fast. So there's a proving out concept where if we build a GreenBox site and we have multiple vendors in that site and they test it, then logically, they're gonna say, "Okay, I want 10 of these sites around the country because I need to cover a national network." So I think what we're doing is doing all our homework, putting in the foundation for GreenBox. And I think we expect to have some good news on GreenBox in 2024, but we're also doing a lot of diligence to make sure that we set the foundation correctly. Okay. And just to be clear, you expect deployments or rev rec to start in this fiscal 2024, is that right? Yes. Okay. And just, you know, from a follow-up question on the pace of deployments in general, obviously, a lot of progress, you know, over the last year or so since the outsourcing strategy ramp up. But kind of as we sit here today, is there any constraints to not maintaining that current pace but accelerating it further? You know, whether it's bringing on additional partners, whether it's continuing to kind of reduce that timeline per deployment. Just trying to get a sense of anything that's changed internally where you're not trying to further accelerate deployments from current levels. I just want to make sure we're all kind of clear on what's changing, if anything, here. So I'll take this one. So the deployments we're doing now in this quarter were actually started a year ago. What we know a year later, which is now from where we were a year ago, we can go faster. We can go a lot faster. Okay, I'll leave it there. Thanks. Thank you. One moment, please. Our next question comes from the line of Derek Soderberg of Cantor Fitzgerald. Your line is open. Yeah. Hey, everyone. Thanks for taking the questions. Just sort of piggybacking off the last question, just around turning on the live systems, with deployment timelines where they're at, it sounds like around 20 months or so. I think a year and a half ago, you were at 13 systems in progress, a year ago, 22. I guess I'm wondering if you think you can bring, you know, maybe those 13 systems to live operation this year, maybe less. Can you share what expectations you have on, you know, the number of systems you think you can turn on this year? Yes, so we typically don't guide on the number of systems we've got in deployment. But as was pointed out, we had gone quarter-over-quarter for four quarters in a row where we were deploying one system a quarter. We accelerated that to two last quarter, and now you saw that accelerate to we deployed three this quarter. I would expect to see continued improvement on that throughout the year. And as you said, that 20-month deployment. But what we also pointed out is that 20-month deployment, that's for what I'll call an average system. So there will be variability. Not every system will deploy in 20 months, depending on the size of the system. We have some systems that we're implementing, which will be significantly larger, and those will take additional time to go ahead and deploy. Overall, the average, we're looking to continue to reduce that time of deployment, and that does enable clearly the ramp of how many we deploy in a given quarter. Got it. And then as my follow-up, just trying to work out some of the math on the recurring revenue. I'm wondering how we should think about the recurring fee, from a percentage standpoint, and is that moving higher as new systems are turning online? And, should we really think about recurring revenue to more or less grow at a similar rate, as these live systems come online? Thanks. Yeah, and so the recurring revenue stream, and I'll start with software. So you saw our second profitable quarter, 430 bps up from where we were. So in terms of profitability, we're seeing progressive improvement to the software margin. From a recurring revenue perspective, when you look fourth quarter to first quarter, you're not seeing as big of a ramp. Those three systems that we brought online went live in the last month of the quarter. And so you're really going to see a much steeper ramp on that recurring revenue. We went from 12 systems in deployment to 15 in deployment, but those last three happened in December, so we didn't see the real benefit. So I think you're going to continue to see that revenue grow. But in terms of your question on the attach rate, we still have, I'd say, you know, a third of the 15 systems that we've got deployed are really early proof of concept systems, where our attach rates were significantly lower. So you're seeing the impact of that. New customers that we're signing on, we're looking to improve that, recurring attach rate, as we've talked about in the past. Perfect. Thank you. Thanks, Derek. Thank you. One moment, please. Our next question comes from the line of Rob Mason of Baird. Your line is open. Yes, thank you. Just to circle back to GreenBox a moment. There were some costs, it looked like in the quarter, small costs, just related to the JV formation. I'm just curious how you expect those and the call on cash to trend through this year. And if, Rick, you could speak to any major milestones as we work towards that first customer announcement. I guess maybe just structurally, internally at GreenBox, major milestones that still need to happen just in the formation of that entity. Carol? Yeah. So Rob, I'll take the first part of that question. That additional small amount of joint venture fees, that was trailing costs associated with all the work we did last year. So you should not expect to see that continue. That was a one-off trailing expense from last quarter. So your second part, in terms of GreenBox, as we've indicated, we expect our first customer this year, and we've got a lot of inbound, as Rick addressed. And we're on the trajectory we had planned for GreenBox. I don't know if that answers the second part of your question, Rob, or not. I mean, can you, what is, is the, is the management in place? Or again, I'm just trying to think, as that, that entity comes to be, you know, what are, what are the other, you know, milestones that, we're looking forward to there? Yeah. So the management is, we're recruiting, we're interviewing management to put that in place. But there's also, from the outside, they may have different skills than we have, whether it's at SoftBank or Symbotic. But right now we have, between the SoftBank talent team and what we're doing at Symbotic, we can actually sell systems into GreenBox. But we expect to expand the management team over the next period of time, fairly quickly, to build a bigger sales force at GreenBox. And so that's the process that we're on. Excellent. Thank you. Thank you. I'd like to turn the call back over to Jeff Evanson for any closing remarks. Thank you, Val, and thank you, everyone, for joining our call tonight. We appreciate your interest in Symbotic. We look forward to seeing many of you at investor conferences or warehouse tours or when we talk next quarter. Have a great night. Thank you. Ladies and gentlemen, this does conclude today's conference. Thank you all for participating. You may now disconnect. Have a great day.