Complete Solaria, Inc. (CSLRW) on Q4 2024 Results - Earnings Call Transcript
Operator: Good morning, and welcome to Complete Solar's earnings call. We will be reviewing our preliminary unaudited 4Q 2024 results, which were issued this morning and appear on our website located at www.completesolar.com. Today's conference call contains projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to known and unknown risks and uncertainties and that may cause actual results to differ from those expressed or implied in such statements. Also on today's conference call, we may discuss certain non-GAAP financial measures and reconciliation of the differences between those non-GAAP financial measures and the most directly comparable GAAP financial measures can be found in the press release issued this morning. I'll now turn the call over to T.J. Rodgers, Complete Solar's Chairman and CEO.
T.J. Rodgers: Good morning. My name is T.J. Rodgers. I'm the Chief Executive and Chairman -- Executive Chairman of Complete Solar. I'm here in Silicon Valley. I want to be in Utah, but I have three Board meetings here today, and I call this meeting right in the middle of them because that was the timing I needed. So I will introduce Dan Foley, our CFO; Dan Myers, Executive Vice President, General Manager of our New Homes division and Steve Erickson, our EVP GM of the Blue Raven division by voice only. I'm here at Enovix in Silicon Valley, and I've got one channel and that's me. And I've got voice for them. Dan say hello, so I can check your voice.
Dan Foley: Hello, T.J.
T.J. Rodgers: Oh my God. Okay. My connection is a cell phone. All right. Good luck. Okay. This is a report we sent out. I will refer to certain parts of it. Today, we're going to talk about Q4 '24, which is a month behind us. Unfortunately, it's subject to a full year audit, which is currently in progress. And that audit is currently hampered by the fact we have to recreate as if merged financials for SunPower and SunPower doesn't have complete financials. So that may take us till mid-March. Hence. I'm not waiting until mid-March to talk about 2024. So I call this meeting today. That puts me here in Silicon Valley because I got other Board meetings here. I apologize for that. Because this is a preliminary report and it's unaudited for the reasons I just gave, we're only going to talk about what I think you want to know now, which is how did we do last quarter and here where we think we're going in the current quarter, and that's what all we're going to do today. First of all, accomplishments. We had a great quarter. In our last third quarter report to you, we gave you a plan for Complete Solar. And that plan was aggressive. It was predicated on a successful $45 million acquisition business unit assets from SunPower to form a new company. And the plan had 2 big accomplishments that were required in it. One, that the little company, a $5.5 million company would acquire a much bigger company, the SunPower Corporation, which has been around for almost 40 years, and it's about 10x bigger than us. That was one assumption achieved. And the second assumption in our plan that we wrote in our third quarter report, our revenue would be $80 million in Q4 '24. That is revenue would jump from $5 million to $80 million in one quarter. This is a slide I showed to investors. I talked about all Complete Solaria, the trouble we had with private equity. We originally marketed $100 million quarter as a likely quarter that turned in to be an $80 million quarter, which we announced on 11/13. And I was worried about taking a jump from here to here as opposed to a jump from here to here until I watched your response to it and your response was right here. There is November 12, and your response was favorable, you'll take a solid $80 million, and that's where we ended up. I'd like to talk about our accomplishments through the quarter. I've got a series of bullets on that and a few slides to illustrate it. First of all, the SunPower integration is substantially complete. We're together. We're organized together. We are starting to -- we've already got down to our headcount. This is a graph by work week going back to the beginning of October. So there is the fourth quarter we're reporting right there. We started out when we first agreed to merge with 3,499 employees. Within 3 weeks, we were down to 416 in our first org chart and then a week later, 2 weeks later, down to 1,257. So this is about what the company needed. We have some people come in on post-merger on day 1. We worked that number down. We got the number down to $11.65, and we thought we were there. And then you noticed here the number went up, and this is when we started discovering employees that, let's just say the 2 companies didn't count very well. And I found 35 Pakistanis that think I'm their CEO. So that count went back in. Then we started working on it again. And as of the end of the quarter, we were down to 1,140 employees. Our goal is to get to 980. So I'm claiming major progress from there to there, and I'm saying we're getting close to the goal. And I actually was going to do that. I pointed -- we've got 2 new divisional GMs in place, EVP/GMs. Dan Myers, this guy -- all right, let me go back, I announced about a month ago. He was a star manager from the Blue Raven Systems division. He was a supply -- is a supply chain expert, and he took over New Homes for us. And then more recently, we got Steve Erickson. Steve is a well-known figure in Salt Lake, which is Solar Valley, the middle Solar Valley. In his career, he had 12 promotions from 3 companies between 2011 and 2024 when he came in. He hit the ground running, wrote me a comprehensive memo the very first week he was there, explaining what he saw that he liked and didn't like, and I advised him to fix the stuff he didn't like and move on. Okay. So we've got our GMs in place. We are forecasting revenue growth next quarter. As you all know, the solar industry has in the winter quarter, has the dip, orders go down, people aren't interested in ordering solar when their roofs are covered with ice. And I did some research that number has typically been 5% to 14%. We're going to buck that because we're finally getting our act together, and we're going to have a good second quarter. And I'm forecasting $82 million up a little bit from the prior quarter, not down. The last point is the company is almost at its fighting weight. I went through that with you showing we're down to 1,140 employees. And we will hit the 980 we need to have. I'll tell you where that number comes from a little bit later. So here's the same slide I already showed you, showing the actual against the $80 million forecast last quarter, in Q4 and the forecast for the quarter we're in at $82 million. And I'll just tell you, we're confident of that number. I'll show you why and when I show you the daily revenue charts. We've cut our operating expense by a factor of 2. That, of course, comes from head count reduction. Our OpEx was an incredible $94 million in the third quarter. That's because we had most of the people from both the companies and a lot of expensive software, $5 million a year for salesforce.com, et cetera. We've gone from $94 million in Q3 to $35 million in Q4 for the combined and cost-reduced companies that I showed you the curve for a minute ago. I like to look at operating expenses, less sales commissions GAAP requires that you call OpEx to be general sales and administrative and if you have sales commissions, then they go into OpEx. So I'd like to look at the OpEx without commissions because commissions come in as directly with sales, and I really care about the fixed expense we've got back in the plant also. In that case, you subtract out the numbers. And in Q3, we were at $84 million, again, an astronomical number. And in Q4, just finished, we had non-GAAP expense of $20 million. So we actually went down from $80 million to $20 million. It's a factor of 4 reduction, and we're planning on dropping another 30% in Q1. That's the 1,140 to 980 that I showed you earlier. We're also forecasting that our cash -- we are forecasting -- this is a big one, income -- operating income breakeven in Q1 '25. The words carefully chosen to say, given our current backlog and cost-cutting plan, we're forecasting non-GAAP operating income at breakeven in Q1 '25. I can tell you that, that number is plus $800,000. And it includes all the expenses we know about, but that's a kind of a fragile margin to predict operating income breakeven and normally in presentations like this, you give numbers, you're absolutely sure of achieving. In this case, we're going to get real close worst case, and I'm announcing it, sort of putting -- drawing a line in the sand here people in the factory listening to what I'm saying we're going to break even in Q1 '25. And we're going to be positive in cash flow. We raised $80 million for the purpose of buying SunPower for $45 million and having operating expense going forward to build a new company. We bottomed out at $13 million of cash left out of the $80 million in Q4, and we'll be going up this quarter. Now the -- so these are the bullets and now fellow shareholders, the main numbers. I'm going to turn it over to Dan. Let's -- no, I'm not going to turn it over to Dan. She's getting her cell phone so she can set it. If she can put in on microphone and she's got a ring on her phone. We're not going to do that. So I'll give you the numbers. Again, it's my fault. I called this meeting out of phase with what we wanted to do because of the long audit. Revenue, let me do non-GAAP, $81.1 million. Our gross margin, you notice has been ugly and up and down. Our gross margin is 37% and you notice our GAAP gross margin is the same thing. So we've kind of flushed the ugly out of the gross margin chain. Our operating expenses were $35.7 million, GAAP and non-GAAP, our operating expenses less commission $19.7 million GAAP and non-GAAP. So for our non-GAAP loss, excluding extraordinary costs, which blew up the GAAP number was $59.40 million. So you can say then this is -- you see the small company and then there's the new company. This is our first quarter, we've now been defined. We're a $324 million company, it's losing money. It needs not to lose money as quickly as possible. That's our next goal. And we've got $13 million in the bank, and we expect it to grow. We acquired SunPower on what I call a Noah's Ark model, I'll explain that in a minute. I already explained the leaning out process we've gone to and the fact we're not quite yet at our goal. I've mentioned that we are going to grow next quarter and that number is conservative, I'm pretty confident in it. Now what happened was when we raised money the $80 million with that plan. And then after we had a flurry of cancellations on the SunPower side because of the bankruptcy, we ended up with the first quarter being $80 million. I'm pretty happy for that and solid. So we're going to move forward from that number. Now that says, if you look at our model for the company instead of having 1,225 employees, we're going to have 980. So that's the goal we're enforcing at 1,140, we're actually below our first goal and we said the new goal was more aggressive of head count of 980. To illustrate that to employees, I actually have shown this slide, I will show it again on Friday. The Ark -- Noah's Ark merger theory is actually a typical Silicon Valley start-up plan in the skies. Instead of a big company in trouble asking for and getting too much money, SunPower was trying to raise when I came in $750 million. And of course, what's worsen wanting to raise $750 million. The answer is actually getting it. Then you own interest on it and it burdens you forever. And so that's not the right way to do it in my opinion. The Ark theory, which I used back at Cypress, we did 20 acquisitions at Cypress, asserts this. Your old company has great assets. If I look at what I inherited was $80 million. It's enough to make the company profitable. Your old company has great assets, get venture funding for those assets, in our case, $80 million and build a new organization that can make profit with what you've got. So Noah's Ark, which is to protect us during floods and we're having a flood of interest rate problems right now in the financial markets, got smaller, and it's now got 980 seats. By the way, believe it or not, this is actually a 4-inch thick oak hull on 500-foot long Noah's Ark model that's built in Williamsburg, Kentucky to -- they claim to biblical standards. Okay. A little bit more detail on revenue. This is a picture of my daily revenue report. So the dots are 91 dots quarter. We came in with $100 million Street number I showed you and we created our beginning of quarter plan, which is the daily plan. For example, you can see the weekends and holidays in here. So it's a tight, well-conceived plan. We took off on the plan and then we got behind. And right here, we said that we're not going to make the BOQ, beginning of quarter plan. We need another plan. So we did what we call an end-of-quarter plan. We decided what level we could get to and have the backlog for the next quarter after that, hence, my certainty on the $82 million this quarter. We picked that target. No more fancy. We took a straight line and we started tracking daily to it. And this was a pretty good quarter. The troops did a great job. I was worried because it was the first test and they passed it. As a matter of fact, right there, you notice it goes flat. That says in the middle of this week, instead of working like hell trying to get up here and not quite making it, we told them you worked hard. You'd like to have a 4-day weekend for the vacation. Have a nice weekend, bam, and we went flat. And of course, revenue that we could have accrued there became available to us quickly in the second quarter. Okay. This is for the whole company. New homes. Different kind of story. They had an aggressive plan. They got behind. They had a new plan. Back is the way they were spiking here. They probably could have made the original plan. But what they did was they got to where they needed to get for the Street. This is their component of the Street number of the $80 million number. And they also, like everybody else took the end of the quarter off. Great quarter. Then we have Blue Raven. That was their first and second expectation. They redefined the quarter as well, everybody did, and they stayed ahead of it for the rest of the quarter, and they also took off. And in this case, I think they probably could have made the original plan. So great quarter. Here's the other story, dealers. So we have a dealer network that buys, orders from dealers, and they had a modest plan of $17 million. They started slow and kept on slow and they reduced their plan of big amount. The reduction from $100 million to $80 million for our plan. Half of that was from the smallest division missing this plan by a lot. So we sized up. We're a new company. This quarter defines who we are. And we said this quarter, Q4, defines who we are, and we said we're cutting our head count from 140 to 5 in the dealer division. So instead of having 2 divisions coming from SunPower, New Homes and dealer, we had New Homes only and then Blue Raven, and that's now the company. And we took some of the stars and merged them in Blue Raven. So here's our org chart. So this half of the company right here is 2 divisions now that are the company they have 921 people. And this -- although it's got a lot more boxes says a lot fewer people, 219 or 19% and I should have drawn that circle up around me. We're all in that. We're support. These guys make the money. We do things for them. We're CFO, Chief Administrative, legal, HR, information technology. But I'd like to introduce Venki, say it for me.
Venki Sundaresan: Sundaresan.
T.J. Rodgers: Sundaresan. I'm usually pretty good with any names but his is kind of simple enough, but dogs me. Venki came from Enphase where he ran an important division for them. And before that, he came from Cypress Semiconductor, who ran all IT. And this is going to be transformative for our company. I asked Venki to be here. He lives in Silicon Valley with me today. And we have another senior VP, I will write about later. We have a new quality VP. His name is Surinder Bedi and he came from Lucid Motors. So he actually was at SunPower very early in his career. He's also worked at Applied Materials, which is a known high-quality Silicon Valley company and in Lucid, an automotive company and automotive companies have as a group of companies, better quality control and I think any other group of companies, perhaps maybe semiconductors might be up there as well. So anyway, we've done some bolstering of our administrative side. We've got 2 divisions. These are the guys that make the numbers for us and our overhead is measured on head count is 19% of our population. Okay. Here's an important point. The Board honored our fourth quarter performance with a modest $1.14 million bonus 1.4% of revenue even in a loss quarter, which is rare. My rule #1 of bonus is, you never get bonus for losing money. But our performance was so good that the Board agreed with me that we should do something. This is $1.14 million for the entire company. That is our loss could have been that much less but we decided to make the loss bigger to reward the employees. Management, we chose the bonus money went all hands equally. So it's $1,000 ahead to recognize that it was rank-and-file employees who made the quarter. We sit -- I sit here in Silicon Valley, and I work a lot of hours, but the rank and file made this quarter for us. The management team owns significant restricted stock, I pointed out, if they ever want to gripe about, gee, only $1,000 for me, and that's a tiny fraction of my salary. Management's got a lot of restricted stock and we're waiting for them to get rewarded when the market says they meet and beat the street a bunch of quarters in a row. And then they'll be well rewarded. So this is a great way to do something for the workers now and remind management that they still got to perform. Our $81.1 million revenue last quarter redefined our company with annualized revenue of $324 million and a loss of $5.4 million. When I did the bullet points upfront, there are 8 of them and all I could think was this is really good. It's bam, bam, bam, bam, bam. And all I could think of was Muhammad Ali, in one of the first fights he fought a bar fighter in England, guy's name is Brian London. Guys one of those big square jawed mean looking guys, and Ali the kid from Louisville, Kentucky, went to London and they were all worried and they said, "This guy has no finesse. He will walk directly at Ali, put him in a corner and when he's got him in a corner, he will punch him once and he'll drop. That was the worry about the fight. Anyway in the third quarter of that fight. Ali never got touched, never got touched. He was floating around and the big guy kind of couldn't keep up with him. And Ali went up and went bam, bam, bam, bam, bam, 12 punches in 2.98 seconds. And the big guy was standing there bam, bam, bam, bam, bam. And Ali just walked to the center of the ring, the guy fell flat in his face into the ring. So that's how I felt about those bullet points. So I had Ali in my mind, and I want to remind you and the employees that our $5.94 million quarterly loss will not survive in 2025, a little rhyme there. Also, I want to thank shareholders. You've stuck with us. You've given us money. We are going to rebuild a classic iconic company, and I want to remind all of you how important SunPower used to be. You got -- it wasn't run well at the end by a lot. There was contention between the divisions of the company. And I was -- I would have been unhappy too. But SunPower is an iconic company. They got founded in 1985. They -- you can see here the black squares and the wing of the airplane. This airplane's wingspan is bigger than 747 and it's completely powered by SunPower solar cells that were made in Sunnyvale, California. It takes off under its own power, 14 electric motors. So it was the Tesla of airplanes way back in 1999. What amazes me about this airplane that really talks about the power of the sun, which remember when Elon Musk brought out the Tesla. And everybody's said golf court, electric car. All right. So you bring out the Tesla and you find out you can lay rubber for 2 blocks. The Tesla Plaid today does 0 to 60 in 1.9 seconds. You can take the biggest muscle car GTO supercharged of any of the older cars, and it will blow it off the road. And these guys did the same thing, way back in 1999 because this airplane flew to a record of 96,863 feet, and that record still stands. And I'll point out, one of the challengers to that record is the F-15, which is a fighter plane been around, it's a Mach 2.5 fighter and is capable of accelerating. It's one of two airplanes that we have capable of accelerating while climbing vertically and its service ceiling is 72,000 feet. So this is iconic picture to the power of the sun. It's already happened. We talk about NEM, net electricity metering and our NEMs being cut back, meaning the grid is no longer giving money back to people in California anyway for people who have solar. Well, why is that. Well, that's actually good news. Solar right now in the middle of the day produces more power than they need, and they're not going to pay for it. We have a solution for that. It's called the battery. I'm actually in a battery company right now in Silicon Valley, not the one that's going to make our batteries. But we have systems today that will make money and provide technology people need. Right now, we're selling solar systems, good ones, we're using good components. My background is technical, and we're going to work on technology as well. So at the end, the loss will not survive in 2025, and we're going to bring back a great tech -- we're going to create a great technology company. You can say bring back but create. Okay. That's it. We're ready for questions.
Operator: [Operator Instructions]. Our first question today comes from Derek Soderberg from Cantor Fitzgerald. Two questions actually. The first one is, how is the portfolio churn trending in home -- in the New Homes business? And what's the plan to grow that business?
T.J. Rodgers: First of all, that business is our most – are more profitable of our 2 businesses. Right now, it’s revenue is looking flat. We have new orders we’re getting. We had a bunch of cancellations. So the lake went down, and we’re now putting – filling the lake back up. We will be up by the end of the year in New Homes having survived the bankruptcy and the hardest hit, part of SunPower during its bankruptcy was New Homes.
Operator: Derek's second question was, how will CSLR effectively leverage the SunPower brand, do you have any new plans?
T.J. Rodgers: I do. And this little teaser here is part of it. Right now, I want to get more braggable in the corporation. But we are going to make use of the name. By the way, we were attacked in court to try to take the name we want. So we own the name. We have the division, the home division of SunPower is still with us and some other people were in the dealer division are still with us in Blue Raven.
Operator: Thank you. The next question is, we understand you have contracts with Starbucks. Is there any more commercial deals in the pipeline? And how do you view that business?
T.J. Rodgers: Okay. I don’t – unfortunately, I don’t have the picture here. Normally, I keep an appendix with all my pictures in it. There’s a fantastic picture of Starbucks and they’ve got an awning. So you’re looking at 3-storey high Starbucks within an awning that sticks out over the entire parking lot, all solar, and it’s glass-on-glass solar. So some panels today are made with glass and then the silicon and then below that, another layer of glass. So when you look at them, you can see right through parts of them. That Starbucks has got a 50,000-watt system. We have 57 Starbucks we’ve dealt with. I think it’s great business. But right now, I got 2 divisions. I’ve got Blue Raven. And there they’re putting homes all over America throughout the Midwest included, and then I’ve got New Homes. The New Homes division is capable of doing the light commercial and that may be the place or we may acquire a company that is in that business.
Operator: The next question is the company has moved through its initial integration and cost reduction quickly post-acquisition of the SunPower assets. Can you discuss incremental cost reduction efforts? And how much more should the market expect on that front?
T.J. Rodgers: How much incremental cost reduction should we expect? What you don’t know is we’re actually ahead of that game. The reason last quarter had a $5.9 million loss was that curve, and we had the high part of the curve, spending a lot of money then coming down. And the average of the quarter was the high part and the low part. We’re entering the new quarter low. So that cost cutting is there already built in. Where else? We’re still paying some rent that we need to get rid of. We still have some software packages we need to stop paying on. But by and large, the heavy lifting is done, cutting costs another 30%.
Operator: Thank you. In the similar vein, you announced achieving operating income breakeven in the first quarter of 2025. What are the risks to this?
T.J. Rodgers: The risk is we don’t do it and then I’m making an aggressive announcement which is atypical. As I said earlier, if you could see the spreadsheets, actually are in here, but I’m not going to show them. Our planned profit, including the ability to pay another bonus. Planned profit is $800,000. Disappears like that if you s**** something up. But if we miss, I don’t think it will be by much. And if we make it, and I think it’s more likely than not we will make it. It’s not a given. It will be a big deal, we’ll celebrate.
Operator: The next question is with regards to additional acquisitions. What is your appetite? And if you are seeking them, would target be bolt-on to current positions or seek to expand your footprint and offerings?
T.J. Rodgers: Give me the choice he gave me.
Operator: [indiscernible].
T.J. Rodgers: I heard that. What are the two choices he gave me. Okay. On expanding, that can be good or bad. Problem is you’ve had in the last 2 years, you’ve had 70 solar companies go out of business. Now you can argue the interest rate is directly what people pay for solar, double the interest rate, double the payment and therefore, high interest rates. The inflation that we’ve unfortunately inflicted on ourselves has harmed a lot of solar companies, that’s 70, I got a list that’s in an alphabetical order and SunPower is on the list. Now having said that, solar companies are not run as tightly as other companies, point one. And point two, the backlog of solar companies, the orders is not as solid. For example, in the chip business, we would take backlog and if some – and we would make chips for somebody, not custom, just a bigger number for another company and they didn’t take them. After that point in time, they would pay a down payment. And therefore, backlog is pretty sacred in our company as most chip companies, you were locked in the last 30 days to take or pay. So you had – you were informed 30 days before the order is going to ship, the order is going to ship, and that was your last chance to bail out. Backlog isn’t solid like that in solar. You actually have teams of people calling other people. And how are things going, and you have a real rate like 20% of people say, “You know, I kind of changed my mind. And it’s a consumer thing, and you can’t be the big bad corporation pounding on some poor homeowner somewhere. So for that reason, solar companies shrink and get bigger and smaller by huge factors. So you can’t take a solar company that’s big and doing well and buy it at a high price. So I look more at potential of companies and I look more at people. And if you’ve got a solid company, that has good practices, that has customers who love them and hasn’t eaten up a lot of cash like SunPower ate up, then and you’ve got something worth acquiring. So I look for companies like that. I look for companies that we acquired a company a year ago, and I talked to the founder. And I said we were thinking about acquiring and I said, “send me your deck. That guy’s name is Cole Farmer, he is still with us, and he said, “I don’t have a deck.” And I said, “I’m thinking how in the hell can you not have a deck”. And he said, we never raised any money. We funded our first systems and then the money from that funded the other systems. And I thought my exact thoughts in that Sunday afternoon phone call, here is the real man. He didn’t run to Wall Street and get paid and gripe about the economy. He goes and makes money. So that’s the kind of company if we acquire. And we will acquire if we can, indigenous growth is great, but extra growth through acquisition is fine. That’s more like what I’m looking for, not some high-flying company or new capability. The consumer – commercial rather you talked about earlier, that’s a more stable business. You’re now dealing with other companies. And that’s a business that if we found somebody that was good at it, and that means they make bigger systems. We’re now talking not 10 kilowatts on your roof, we’re talking about 1 million watts in a field with control of the angle of the panels to follow the sun. That could be another option. Technology is another option, by getting a technology that gives us a better panel or gives us a better panel. And I’m actually working with companies on that right now. And that would be something else. So we’re not just going to grow. There were companies in Salt Lake that tried that, just sort of agglomerating companies and they found a bunch of small wheat companies, equaled one big wheat company and it didn’t work out. That’s a long answer.
Operator: I have a longer one with respect to the dealers division. It sounds like you shrank the dealers division to create more profitable growth in the long term. Can you please discuss the strategy and your outlook for that segment?
T.J. Rodgers: It was a real tight call right at the end to stay in the dealer business or not. The way the dealer business works is you have people who sell orders. They go through their process, which is complex, and they get a homeowner to sign a contract. I will buy your system. Then they can sell that deal to a company that installs and is a full-service company like ours. And amazingly enough, that order is worth 30% or even more sometimes of the value of the order. That is getting the order costs you 30% of revenue upfront. And then you deal with the guy changes his mind halfway through. Therefore, it’s an unstable business, and there are tectonic shifts in the business where that goes into fashion, goes out of fashion. And what I know from our own experience with the division, we merged into the other division and my company before that, Complete Solar. The mother of this – by the way, oddly enough, Complete Solar, the mother of this company is a grand total of maybe 60 people out of 1,000, and we’re spread all over the company, including my position. And we’re not the company anymore. We’re the money and the funding and the guidance for the company. So we’re looking for solid things. It’s not quite reasonable to use Warren Buffet’s name here, but we’re thinking that way when we look at what we can acquire and bring in and which businesses we should grow. And right now, dealer does not look like one of those businesses we grow. And by the way, I want to point out that our Blue Raven division is its own dealer. It has a large group of salespeople, and we get our own orders, and therefore, we get all the profit going up. So we understand how it works. We understand what it costs. That 30% is not phony. That is it really takes that much money to get the order and keep it. So right now, that’s not where we want to be.
Operator: Thank you. It looks like we have two more in the queue. [Operator Instructions] The next question is, how do you see yourself differentiated versus your peers in the next 6 to 12 months?
T.J. Rodgers: We will be financially stable on a cash flow basis in tough times. So Marine Corps we’re going to come out of this being a difficult company to compete with. In a consumer business, we are going in and are now. They have great consumer ratings. We’re going to get better on that. And then the new angle is going to be technology and acquisition, which, again, I can’t – right now, I’m working on several technologies, and I can’t name one for you that I’m ready to move on. And in acquisitions, we’re always looking at acquisitions, always.
Operator: The last question I have here is, can you provide any timing on when your name change to SunPower might occur?
T.J. Rodgers: I’m surprised that, that is a major – well, I asked for it, right? I showed the picture of the airplane. Can’t right now, the problem we’ve got is the SunPower I knew, I was the Chairman of SunPower when it went public in, I think it was 2004. I was the Chairman of SunPower, Cypress Semiconductor my company owned them. And the SunPower, I remember, they conquered the world, built and put the power in that airplane, wasn’t the one that was experienced in Salt Lake. It was something that would cause this like if you worked with them. And so I got half the company that doesn’t remember SunPower well, but I got a name that’s worth $0.5 billion, and I’m going to figure out how to make all that work together.
Operator: Thank you very much. That looks like all the questions we have in queue today. Thank you, everyone, for joining the call today. You may now disconnect.
T.J. Rodgers: Thank you.
