ChargePoint Holdings, Inc. (NYSE:CHPT) Q3 2024 Earnings Call Transcript

Mansi Khetani: Yes. With respect to the inventory and the impact on margins, so the Q3 impairment was related to product transition. So, we impaired all the slow-moving product that we are not actively selling today. So, while there is no direct margin impact from sell through of that product, what it does have — where it does have margin is the material variances that we would be taking slowly over time as we find ourselves dealing with slower moving inventory. Every quarter we’ll write off a little portion. That part is taken care of because we’ve taken all of that up front. So, to that extent, there will be some impact or some benefit to margin, but in terms of the actual reduction in cost, the inventory that we now have comprises of the newer products, the next-gen products, and those are at full value.

Steven Fox: Thank you very much. That’s helpful.

Operator: Our final question comes from the line of Brett Castelli with Morningstar. Please go ahead.

Brett Castelli: Hi, thank you. Just sticking with that last question around new products, I just wanted to confirm that there’s no new, I’ll call it large new products, either on the AC or the DC side that you’re planning on rolling out over the next 12 to 18 months. I just want to confirm that that’s largely — that’s behind us at this point, at least in the area.

Rick Wilmer: Yes, Brett, we have one product transition plan for late 2024, another one planned for mid-2025. Those will be the next two coming up, and we have definitely learned from our lessons, and we’ll make sure that we optimize the bleed data of the inventory on the products that those new products will be replacing.

Brett Castelli: Okay. And is that on the AC or DC side, Rick?

Rick Wilmer: No, I’m not going to go into any pre-product announcements here. I can tell you they’re both awesome products though.

Brett Castelli: Yes. Fair enough. I’ll leave it there. Thank you.

Rick Wilmer: All right. Before we close the call —

Operator: Pardon me. I’d now like to turn the call over to Rick Wilmer for closing remarks.

Rick Wilmer: All right. Thank you. Before we close, I’d just like to thank our shareholders, customers, and employees for your continued support. Thank you very much for your time.

Mansi Khetani: Goodbye.

Operator: I’d like to thank our speakers for today’s presentation, and thank you all for joining us. You may now disconnect.