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Edited Transcript of VECO earnings conference call or presentation 13-Feb-20 9:30pm GMT

Q4 2019 Veeco Instruments Inc Earnings Call

PLAINVIEW Feb 19, 2020 (Thomson StreetEvents) -- Edited Transcript of Veeco Instruments Inc earnings conference call or presentation Thursday, February 13, 2020 at 9:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Anthony Bencivenga

Veeco Instruments Inc. - Head of IR

* John P. Kiernan

Veeco Instruments Inc. - Senior VP & CFO

* William John Miller

Veeco Instruments Inc. - CEO & Director

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Conference Call Participants

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* Auguste Philip Richard

Northland Capital Markets, Research Division - MD & Senior Research Analyst

* David Duley

Steelhead Securities LLC - Managing Principal

* J. Ho

Stifel, Nicolaus & Company, Incorporated, Research Division - MD of Technology Sector

* Mark S. Miller

The Benchmark Company, LLC, Research Division - Senior Equity Analyst

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Presentation

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Operator [1]

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Good day, everyone. Welcome to the Veeco Instruments Inc. Corporate Hosted Q4 and Fiscal Year 2019 Earnings Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Anthony Bencivenga, Head of Investor Relations. Please go ahead, sir.

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Anthony Bencivenga, Veeco Instruments Inc. - Head of IR [2]

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Thank you, and good afternoon, everyone. Joining me on the call today are Bill Miller, Veeco's Chief Executive Officer; and John Kiernan, our Chief Financial Officer. Today's earnings release is available on the Veeco website. Please note that we have prepared a slide presentation to accompany today's webcast. We encourage you to follow along with the slides on veeco.com. This call is being recorded by Veeco Instruments and is copyrighted material. It cannot be recorded or rebroadcast without Veeco's expressed permission. Your participation implies consent to our recording.

To the extent that this call discusses expectations about market conditions, market acceptance and future sales of the company's products, future disclosures, future earnings expectations or otherwise make statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors are discussed in the business description and Management's Discussion and Analysis sections of the company's report on Form 10-K and annual report to shareholders and in our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and press releases.

Veeco does not undertake any obligation to update any forward-looking statements, including those made on this call to reflect future events or circumstances after the date of such statements.

During this call, management may address non-GAAP financial measures. Information regarding such non-GAAP financial measures, including reconciliation to GAAP measures of performance, is available on our website.

With that, I will turn the call over to Bill for his opening remarks.

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William John Miller, Veeco Instruments Inc. - CEO & Director [3]

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Thank you, Anthony. Good afternoon, everyone, and thank you for joining the call. I'll be talking you through our financial results and discussing our markets. But first, I would like to provide an update on our previously announced company transformation.

We characterize our transformation in 2 phases. The first phase, returning the company to profitability is well underway and includes reducing costs and delayering the company. As part of the delayering process, we limited the COO role when Sam Maheshwari announced his resignation from the company last December. I am excited to announce that I promoted John Kiernan to the position of Senior Vice President, Chief Financial Officer as of the beginning of the year. John has been at Veeco for 25 years, leading just about every finance function, and we worked together for the last 15 years. I'm happy to be partnering with John as we continue through our transformation and prepare the company for growth.

Now I'll take you through our 2019 progress and high-level financials, then I'll turn the call over to John for a more detailed financial review.

For 2019, our priorities were to innovate, penetrate markets and improve profitability. Regarding our innovation objective, we executed very well. We shipped the multiple Ion Beam Deposition systems for EUV mask blank production, we optimized our MOCVD platform for photonics applications and shipped our first beta system to a premier compound semi customer.

We developed a 300-millimeter single-wafer fully automated MOCVD cluster tool and shipped with acceptance to a major front-end semiconductor fab. We updated our advanced packaging lithography product to improve its performance and we made major enhancements to our laser annealing product to improve our competitiveness at the next nodes.

Regarding our market penetration objective, we had mixed results. We enjoyed great success in the EUV mask blank market with our Ion Beam Deposition systems. We have promising traction at very advanced nodes with our laser annealing product at 2 semiconductor industry leaders. In advanced packaging, we are still experiencing soft market conditions for lithography products. And in the photonics market, we are disappointed with weak market condition for VCSELs.

And lastly, regarding our objective of returning to profitability. Throughout 2019, we improved our non-GAAP gross margin. Our Q4 2018 gross margin was 36%, and we exited 2019 at 40.2%. Our non-GAAP operating expenses have been declining. Entering 2019, we're at $43 million in quarterly OpEx and are now at $38 million at the end of the fourth quarter. We also returned to non-GAAP profitability by posting 2 consecutive quarters of positive EPS in Q3 and Q4 of 2019.

On our balance sheet, our inventory improved throughout the year as well. We opened 2019 with $156 million in inventory and reduced that figure to $133 million by the end of Q4 2019.

And now for Q4 results. We capped off 2019 with solid execution in the fourth quarter. Revenue was $113 million, which was above the midpoint of our guidance. We achieved strong revenue in our front-end semiconductor market, driven by shipments of our EUV mask blank and laser annealing systems. Additionally, sales of our Ion Beam products to the data storage market remains solid. Non-GAAP gross margin was 40.2%, which was in line with guidance.

We are happy to report non-GAAP operating income was $7.4 million, resulting in earnings per share of $0.11. Importantly, we generated $14 million in cash and we entered 2020 with positive momentum.

Looking at the full year 2019 non-GAAP results, our revenue was $419 million. During this transformational year, where we lost over $100 million of commodity LED revenue, we were able to generate $5 million in operating income. Our 13% second half revenue growth over first half exceeded our 10% outlook. And as forecasted, we exited the year with 40% gross margin and returned to profitability with positive non-GAAP EPS in Q3 and Q4.

Throughout the year, as part of our delayering, we eliminated over 30% of Vice President level and above positions, while trimming approximately 7% of our individual contributor positions. This was an intentional approach to our infrastructure reduction and preserves our ability to execute. We also reorganized along product lines with a central R&D organization, which enables us to better allocate our R&D spend to our highest priority projects across the company. This allows us to improve our customer focus and operational efficiency.

In addition to prioritizing R&D spend on projects with the highest financial and strategic importance to the company, we are evaluating our existing product lines through a similar set of criteria. You will notice in our financials an asset held for sale, which is an indication of our intent to divest a certain noncore product line.

At this time, I would like to address the recent coronavirus outbreak. Our priority is the health and well-being of all our employees and stakeholders, and we hope the situation is resolved quickly. In the interim, we are monitoring the situation carefully and have implemented appropriate travel restrictions.

With that, I will turn the call over to John for a review of the financials, then I will provide a market update.

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John P. Kiernan, Veeco Instruments Inc. - Senior VP & CFO [4]

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Thanks, Bill, and good afternoon, everyone. Today, I will summarize our revenue by market and geography, cover our P&L, balance sheet and cash flow and then take you through our outlook for Q1. I will discuss non-GAAP financial data and would encourage you to refer to our reconciliation between GAAP and non-GAAP results, which you can find in our press release or at the end of the quarterly earnings presentation.

Revenue for the quarter was $113 million. The front-end semiconductor market was 35% of our revenue due to multiple EUV, mask blank and laser annealing systems. The scientific and industrial market made up 28% of that revenue and was led by Ion Beam system shipments to our data storage customers. LED, lighting, display and compound semi was 23% of revenue. We had multiple wet etch and clean system shipments to RF device customers for 5G-related power amplifiers. Revenue in this market also included the sale of slow-moving LED-related inventory.

The advanced packaging, MEMS and RF filter market made up 14% of our overall revenue, reflecting the continued softness we are experiencing in this market. By region, Rest of World, which includes Japan, Taiwan, Korea and Southeast Asia, was 48% of overall revenue, driven by our EUV mask blank and LSA systems. U.S. was 23%, which included sales to the data storage market. China was 22% of overall sales, mainly from multiple wet etch and clean systems. And finally, EMEA was 7% of overall revenue.

Now turning to non-GAAP operating results. Fourth quarter gross margin of 40.2% was flat from Q3. We are happy that we are exiting the year at 40% as forecasted, but please note that in selling off a portion of our slow moving inventory, there was a slightly negative impact to gross margin. We do expect to continue to sell off the slow-moving inventory in 2020, which may provide gross margin headwinds. However, we are still targeting 40% gross margin or better going forward.

OpEx for the quarter was $38 million and favorable to our forecast. We are beginning to see the impact of the infrastructure cost reductions ahead of our target plan.

Tax expense for the quarter was approximately $600,000. Net income came in at $5.4 million, with EPS of $0.11 on a diluted share count of 48 million shares. Our GAAP net loss widened in Q4, principally because it included a $21 million noncash charge associated with our investment in Captiva. As of December 31, 2019, we determined there were certain impairment indicators, which led us to conclude that our investment was fully impaired.

And now I'll provide a few full year financial numbers. For fiscal 2019, depreciation was $17.3 million, amortization was $17.1 million, and our equity comp expense was $15.3 million. Capital expenditures for the year were $10.9 million. Dilution rate from employee equity was approximately 1% of outstanding shares.

Cash interest expense on our debt was $9.3 million and cash taxes were $2.9 million. At the end of the year, we had federal NOLs of $271 million, which are fully reserved. We ended the year with Q4 bookings of $110 million and backlog of $268 million. As we've communicated throughout the year, starting next quarter, we will no longer be providing quarterly backlog and booking results.

Now moving to the balance sheet and cash flow highlights. We ended the quarter with cash and short-term investments of $245 million. Cash flow from operations was $16 million due to earnings in the quarter and a $7 million reduction in working capital. Accounts receivable decreased due to the timing of customer payments, resulting in 36 days of sales outstanding, which is lower than our historical average, while we lowered our accounts payable, resulting in 28 days of payables outstanding.

Inventory declined $2 million. We made progress selling slow-moving inventory in Q4, which has been a focus of ours for some time. And given order activity in this area, we expect to continue to monetize this inventory throughout 2020.

Long-term debt on the balance sheet was recorded at $300 million, representing the carrying value of our $345 million in convertible notes. And lastly, our CapEx during the quarter was $2.7 million.

Now turning to Q1 guidance. There is still a significant level of uncertainty from coronavirus-related travel restrictions and factory shutdowns in China. Accordingly, we have widened the low end of our guidance range to accommodate this uncertainty.

Q1 revenue is expected to be between $95 million and $120 million, with non-GAAP gross margin between 39% and 41%. We expect non-GAAP OpEx to be around $37 million. GAAP EPS is expected to be between a loss of $0.24 and a loss of $0.01 per diluted share. Non-GAAP EPS is expected to be between breakeven and $0.22 income per diluted share.

And now for some additional color beyond Q1. At this time, based on our current visibility, we see Q2 revenue trending similar to or slightly higher than Q1. Please note that this Q2 outlook does not incorporate any potential coronavirus impact, which is unknown at this time.

Additionally, we are ahead of plan with OpEx reductions and reiterate that, at current revenue levels, we expect non-GAAP OpEx to decline toward our target of $36 million per quarter by Q3.

And with that, I'll turn it back over to Bill.

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William John Miller, Veeco Instruments Inc. - CEO & Director [5]

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Thanks, John. And now for a business update.

We are seeing positive indicators in semiconductor markets. Wafer fab equipment spending is forecasted to increase in 2020 to somewhere around $50 billion. This capacity increase is driven by leading node semiconductor fabrication and advanced packaging in areas such as artificial intelligence and high-performance computing, 5G wireless infrastructure deployment, cloud computing and big data, and autonomous driving. Generally speaking, these market trends and the capacity our customers require bode well for our technologies like ion beam, laser annealing, lithography and MOCVD.

More specifically, in our front-end semi market, we are experiencing strong demand for our Ion Beam Deposition systems from our EUV mask blank customers. This is consistent with recent messaging from ASML, which reflected 26 EUV lithography scanners shipped in 2019, plans to ship 35 systems in 2020, and capacity improvements underway to ship between 45 and 50 systems in 2021.

We also continued to do well with our laser annealing products in the front end semiconductor market. In the fourth quarter, we recognized revenue on multiple laser annealing systems at leading edge nodes. As these customers continue to ramp these leading edge nodes and begin to invest for their next nodes, we hope to gain share given our laser annealing advantages and ability to meet our customers' advanced requirements.

In our advanced packaging, MEMS and RF filter market, we achieved co-production tool of record status at a major OSAT for a fan-out wafer-level packaging application with our lithography product. We are encouraged by this accomplishment as it validates our lithography technology and ability to compete in this market. The lithography portion of the advanced packaging market has been soft for well over a year. However, we believe the softness is a result of overcapacity and the drivers, such as AI and high-performance computing, will persist, and in time, this market will resume growth.

We are largely complete with our new lithography system targeted at advanced customers in packaging. We improved the product's field size, uniformity and depth of focus, and we expect to ship evaluation systems to leading semiconductor manufacturers in the coming quarters.

In the compound semiconductor market, Veeco has a long history of technology leadership in MOCVD and offers a breadth of products to address many applications. We have an automated gallium nitride single-wafer cluster tool, which can accommodate wafer sizes up to 300-millimeter. This will be used for power and RF device manufacturing. And we recently announced Lumina, our arsenide phosphide platform, which is ideally suited for photonics applications.

The Lumina system is currently being evaluated by a leader in photonics, and we are achieving excellent feedback. Additionally, during the quarter, we received an order from another customer for the Lumina system. We are confident in the performance of our entire MOCVD portfolio, and we are ready with best-in-class technology solutions to address the needs of the photonics, 5G RF, power and micro LED display markets.

And finally, in the scientific and industrial market, the data storage dynamics, driven by cloud computing and big data, continue to be positive for Veeco. Sales to our data storage customers were again strong in the fourth quarter, and we expect sales to remain strong at least through the end of 2020.

Looking ahead to our priorities in 2020. We are focused on prioritizing our R&D spend on the project that are strategically and financially most impactful to the company and strengthening our foundational businesses. We also seek to extend our core technologies into the front-end semiconductor and photonics and RF markets. And we are starting to see the operating leverage benefits of actions taken to improve gross margins and reduce our operating expenses. We expect to continue to reduce operating expenses and deliver strong gross margins throughout 2020.

And with that, John and I will be happy to take your questions. Operator, please open

(technical difficulty)

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Questions and Answers

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Operator [1]

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(Operator Instructions) We'll hear, first, from Auguste Richard with Northland.

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Auguste Philip Richard, Northland Capital Markets, Research Division - MD & Senior Research Analyst [2]

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Yes. Congratulations on a good quarter. Could you give a little more color on the second Lumina order. Is that for VCSEL application or edge-emitting lasers?

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William John Miller, Veeco Instruments Inc. - CEO & Director [3]

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Yes. Thanks for the question, Gus. You know we have placed the beta in the field back in 2019. We're getting excellent results for, not only VCSEL stacks, but also other photonics applications and getting very good feedback from that customer.

Also, we're sharing our VCSEL and micro LED data with several of the important end customers, and they've been impressed with their results as well. And to your question, yes, we did receive straight up purchase order from a second customer. And our understanding is that is for a VCSEL application. So that's very positive. So although 2019 was...

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Auguste Philip Richard, Northland Capital Markets, Research Division - MD & Senior Research Analyst [4]

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Got it.

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William John Miller, Veeco Instruments Inc. - CEO & Director [5]

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Go ahead.

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Auguste Philip Richard, Northland Capital Markets, Research Division - MD & Senior Research Analyst [6]

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I'm sorry. And then on the EUV side, it looks like you're shipping roughly one a quarter. Is that the kind of run rate we should expect going forward? Or given the proliferation of EUV, should that grow a little bit faster?

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William John Miller, Veeco Instruments Inc. - CEO & Director [7]

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The shipment profile is going to be a bit lumpy. We ended up shipping 4 tools in 2019. But in any given quarter, we could be shipping 0, 1 or 2. I think our backlog going into 2020 here, we have 3 tools in backlog for the year.

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Auguste Philip Richard, Northland Capital Markets, Research Division - MD & Senior Research Analyst [8]

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Got it. And then on LSA, can you kind of split out for us, what -- how much is leading edge, let's say, 5-nanometer, 7-nanometers and below? And how much is the 28-nanometer and more China customer related?

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William John Miller, Veeco Instruments Inc. - CEO & Director [9]

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Yes, I don't have that exact number right at the tip of my fingers here. But I would say, just looking back through 2019, I would say, about 80% is at the leading edge nodes and maybe 20% is at the 28-nanometer nodes, approximately, 80-20.

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Auguste Philip Richard, Northland Capital Markets, Research Division - MD & Senior Research Analyst [10]

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Got it. And then I guess, the last one for me. Obviously, the coronavirus is a wildcard. Can you give us a little bit of a sense as to what this slip is in revenue? What are you selling indirect to China? Is it LSA systems? Is it advanced packaging? And how many of your customers in the -- near Wuhan or that province?

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William John Miller, Veeco Instruments Inc. - CEO & Director [11]

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Yes. Our -- we've been talking to our customers. Our understanding is that all of our customers' facilities actually are open today. If you look back over 2019, our China exposure was 10% to 20% of revenue. Specifically, here in the first quarter, it's about 10% of revenue. We are selling a mix of products, some MOCVD equipment as well as somewhat clean and etch products here, that's our mix in the first quarter.

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Operator [12]

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We'll hear next from David Duley with Steelhead Securities.

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David Duley, Steelhead Securities LLC - Managing Principal [13]

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I had a couple. I guess first on -- you mentioned that you had some slow-moving or older inventory that you were selling that could provide some potential headwinds, could you just give us a little bit more detail, how much inventory, dollar-wise, do you have to -- is slow moving or however you might classify that? And what is roughly the impact that you saw in the December quarter or in the March quarter from selling older inventory?

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John P. Kiernan, Veeco Instruments Inc. - Senior VP & CFO [14]

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Sure. We had mentioned in prior calls that we had about $25 million of what was categorized as a slow-moving inventory. We began to make progress, and we have been -- that had been an ongoing focus for us. And we did make progress in Q4 of 2019, we did sell off about $5 million of inventory. We've made progress in terms of also in order activity recently, and it's our current expectation to monetize this inventory throughout 2020.

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David Duley, Steelhead Securities LLC - Managing Principal [15]

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And so that impacts on gross margins?

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John P. Kiernan, Veeco Instruments Inc. - Senior VP & CFO [16]

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Yes. So the -- yes, we did mention that selling off this slow inventory provides some headwinds to gross margin. We see it in the 1 to 2 percentage point range.

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David Duley, Steelhead Securities LLC - Managing Principal [17]

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Great. And then as far as your advanced packaging business, did you -- I was a little confused, did you mention that you were -- won a piece of business with an OSAT for lithography on a fan-out line. Is that -- could you just repeat what you said there?

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William John Miller, Veeco Instruments Inc. - CEO & Director [18]

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Yes. You have that correct, Dave. We said we were a co-PTOR at an OSAT for a fan-out wafer-level packaging application.

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David Duley, Steelhead Securities LLC - Managing Principal [19]

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Okay. And who is the other viable competitor there?

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William John Miller, Veeco Instruments Inc. - CEO & Director [20]

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I believe it would be Canon.

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David Duley, Steelhead Securities LLC - Managing Principal [21]

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Okay. And as far as your -- the big initial customer that was the guy who kind of embedded the fan-out package, certainly, on their conference call, they're talking about a big increase in CapEx for back-end applications. I'm not sure how much is directed at fan-out or lithography. But would you expect to see orders from that big customer sometime this year? Or has there been any indication of things improving there for your types of pieces of equipment?

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William John Miller, Veeco Instruments Inc. - CEO & Director [22]

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Yes, we are in very close contact with that customer, as you might expect. Our visibility and lead time is not very long for this equipment. So we wouldn't actually have visibility that far out. But we certainly hear and see expectations of the lithography market picking up in the second half of the year. We just don't have visibility to that given our short lead times.

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David Duley, Steelhead Securities LLC - Managing Principal [23]

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Okay. And back to the OSAT win. Is there a way to quantify how significant this is for you? Will you be shipping multiple tools on a quarterly basis? Or is it just a couple of tools initially? Or any sort of flavor you could give us around that, that will be much appreciated.

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William John Miller, Veeco Instruments Inc. - CEO & Director [24]

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Yes. Thanks, Dave. I would say it's probably -- what we can see is it's probably just a smaller handful of tools throughout the year. Obviously, same issue with -- given our lead times, we -- we're not given a lot of visibility into their longer-term demand cycles.

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David Duley, Steelhead Securities LLC - Managing Principal [25]

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Okay. And then final thing from me is what -- if you could help me understand how important the 5G ramp is for you guys. I know it touches multiple product lines, but as far as where you think it will make the most significant movement of the needle, which areas would that be?

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William John Miller, Veeco Instruments Inc. - CEO & Director [26]

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Yes. We're actually seeing pretty broad demand from 5G. The first implementations of 5G we're seeing are really less than 6 gigahertz, where the equipment sets are fairly similar to 4G. We're also seeing some interest in millimeter wave, kind of the greater than 20 gigahertz opportunities. And for those opportunities, that would really be MOCVD opportunities for us. And we are starting to see some early positive signs there.

But I would say we are seeing broad demand for many of our products from many customers really driven by 5G. I mentioned power amplifiers, we have an MOCVD player there. We're also selling -- having order activity and discussions on wet processing equipment, Ion Beam Etch and lithography tools. And in the RF filter space, we're seeing opportunities in wet processing and our ALD equipment. So I would say there -- as I look to the future, this could be driving the business longer term, but I would say it's really very early.

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Operator [27]

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(Operator Instructions) We'll go next to The Benchmark Company's, Mark Miller.

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Mark S. Miller, The Benchmark Company, LLC, Research Division - Senior Equity Analyst [28]

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You indicated that the -- you expected data storage business to remain strong throughout 2020. Is that predicated on a pickup in terms of orders from memory customers, NAND customers later in the year?

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William John Miller, Veeco Instruments Inc. - CEO & Director [29]

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Mark, good question. It's actually not predicated on that. We have a very good opening backlog position in our data storage business. And we -- so we are pretty confident in our view from data storage in 2020. This still kind of remain strong from an order standpoint, but we'll -- as the year unfolds, we'll see if the order activity kind of remains strong as it is now.

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Mark S. Miller, The Benchmark Company, LLC, Research Division - Senior Equity Analyst [30]

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A number of people were talking about 5G are talking about acceleration in terms of their equipment orders later this year. Do you expect a similar acceleration as we go towards 2021 for 5G opportunities?

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William John Miller, Veeco Instruments Inc. - CEO & Director [31]

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Yes. As I just answered a similar question, we are seeing broad opportunity in a lot of our equipment sets from a number of customers. And there really just starting to be some early discussions, some demo work, some quotations going out, but the activity is certainly increasing. And I wouldn't be surprised if it does pick up, but I'm really not quite ready to call a big pickup in 5G in the second half of the year yet.

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Operator [32]

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We'll go now to Patrick Ho with Stifel.

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J. Ho, Stifel, Nicolaus & Company, Incorporated, Research Division - MD of Technology Sector [33]

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Bill, maybe just a follow-up on the advanced packaging lithography side. You mentioned some new wins there. Right now, as that marketplace remains in the low, this is actually a great time for you to do evaluation. But how do you see the, I guess, the buying when the business picks up again? And what I mean by that is, typically, when these guys stop buying, they'll just buy capacity and then go back to things that they're used to. Do you see when this market turns, I guess, more volume buys for your new system versus the old systems?

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William John Miller, Veeco Instruments Inc. - CEO & Director [34]

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Yes. Yes. As I said, we did win an advanced packaging litho application at an OSAT. And we also made some significant investments in 2019 in a new lithography platform with better resolution, better field size and the like, and so -- as well as depth of focus. And we are working with the leaders in the industry to place eval tools right here in the coming months and quarters. I think we should be well positioned when this market does come back with a market-leading product to hold our leading market share.

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J. Ho, Stifel, Nicolaus & Company, Incorporated, Research Division - MD of Technology Sector [35]

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Okay. And maybe as my follow-up question, in terms of LSA. Obviously, you're in the very leading edge with some of your top-tier customers on that front. They're also now starting to do evaluation and design work for their next-generation nodes. How do you see the application increases as you go from node to node in terms of LSA? And basically, what I'm kind of getting is the capital intensity for LSA as you migrate down their nodes.

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William John Miller, Veeco Instruments Inc. - CEO & Director [36]

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We're working with the leaders in the industry on their next nodes. And we actually are very excited to see that, as the nodes become finer, the need for our laser spike anneal technology increases. We think we have an opportunity to go from one step today to 2 and maybe even 3 steps at the next node. So we're working very, very closely with those customers on those evals right now.

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Operator [37]

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(Operator Instructions) And with no other questions at this time, I'll turn things back to you all for closing remarks.

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William John Miller, Veeco Instruments Inc. - CEO & Director [38]

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Thank you, operator, and thank you all for joining the call today. We are excited to be entering 2020 with positive momentum and a more focused and streamlined company positioned for success. Have a great evening.

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Operator [39]

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Again, that does conclude today's conference. Thank you all for joining us.