That’s a role that our marketing department has been doing, sharing the information as best possible between them, but this time we gave them a platform to do it with each other directly, I think was very encouraging. And we had quite a few operators walk away and come to us, not just spouting the value, but saying, okay, we learned that this other operator is doing this and that. And we think that’s a good idea, so we’re going to see how we can implement it and drive higher adoption and revenues in our market. And we have quite a few of those, so we’re trying definitely to get that to happen.
Rory Wallace: Thanks. Yeah. That sounds positive. And thinking about the SECaaS revenue going into next year, it’s clearly going to grow. I think you can’t control the adoption curve, but Verizon is going to be almost all incremental next year. And then, FET should generate decent growth, I would say, if you just kind of model out what they’ve been doing. So is there anything you should think about on the flip side with SECaaS, why it wouldn’t grow at a rapid rate next year? And taking it to the next level, when does that business really reach a profitable scale in your opinion? And obviously subject to change, but I think it’s important to consider when that business might become cash generative and what it would take to get there if it’s Verizon expanding a deal or if it’s winning several new operators and how you see that evolving over the next year or two?
Erez Antebi: I think you’ve asked, Rory, — I think you’re asking the right questions and I think that those are the answers we need to answer ourselves as we’re building our plan and budget for next year. And with — I would like to be a bit more cautious and I prefer to address those questions in more detail after we have our plan, budget and numbers for next year and I feel more confident and can give you more detail on that.
Rory Wallace: That’s fair. Thanks. And then just a couple of questions on the model. One is on product revenue. This year, it looks like it’ll probably be the lowest product revenue you’ve had in 10 years or more. And I guess versus the expectations you had coming into the year, what does your gut feel about how much of the miss was driven by macro? We know it’s a very bad carrier spending backdrop, everyone has confirmed that outside of you versus some of these secular issues or even execution issues, frankly, that might have contributed to the revenues coming in lower?
Erez Antebi: I think the majority has to do with the macro. We did a loss analysis on the deals during this year. We went one by one and everything that we were working on and did not materialize into a deal and is not still in process. We haven’t, or say most of the business that did not close, did not close because of macro-related issues, budget issues, expense cuts on the operators, things like that. I think our competitive positioning is still strong and I think the number of execution related problems, they exist. I’m not saying they don’t, we can always improve on execution, but I don’t think it would have made a material with different results. Most of it is macro.
Rory Wallace: Got it. And then with the expense structure, you mentioned there’s $1.5 million of OpEx related to the RIF (ph). Where does that show up in operating expenses? I wasn’t sure looking at the release.
Ziv Leitman: This is part of the OpEx because it relates to the people that there were RIFs. It’s like the one-time expense of the risk. So if
Rory Wallace: But would that actually be shown on the press release? I’m not sure.
Ziv Leitman: Yeah. So for instance, if X people were risked from R&D. So the relevant one-time rate expenses is in R&D. If there are people from SG&A, so it will be shown in SG&A. In the same place where we book the salaries.
Erez Antebi: You didn’t break it down to separate lines.
Rory Wallace: Yeah, you didn’t break it down. Yeah.
Ziv Leitman: It’s a 1.5, no? No, the 1. 5, it’s not in separate lines. It’s embedded in the R&D, SG&A, COGS and so on.
Rory Wallace: Understood. And it wasn’t shown separately. That’s just what I wanted to confirm. And then if I adjust for the 1.5, it gets me roughly $21 million or a little under $21 million of base recurring OpEx in Q3. And then we should expect that there’s a $15 million expense reduction that will flow through the P&L over the coming quarters, which should reduce expenses by around a little shy of $4 million a quarter. Is that a reasonable way of looking at the model and where expenses should land?
Ziv Leitman: I’m not sure it’s the right number, but we would like to refer to those numbers only in February, after we finalize the budget process and we will be ready with our 2024 guidance.
Rory Wallace: Got it. And one last question. Thank you for being patient with my question. So you mentioned a large deal that was potentially going to drive a variance in cash flow in Q4. Is that a revenue deal or is that a booking with a prepayment and the revenue ships outside of the quarter?
Erez Antebi: I would say that it could go either way, so that tends to be a wide range. Let’s see where we end up there. If we close it, then how we close it.
