They’re around proprietary, very large-purpose built facilities, and then a footprint and carrier neutral facilities for connectivity to the greater internet. Most of those customers are looking to add a third-tier, which would be something between those two extremes, and our data centers are very interesting to them. We are in discussions around wholesale capacity in our centers, but again, we’re just not in a position to sell at this point.
Nick Del Deo: Okay. Great. Thanks, Dave.
Operator: Our next question comes from Brandon Nispel from KeyBanc Capital Markets. Your line is now open.
Brandon Nispel: Great. Thanks for taking the questions. Did you just go through the corporate, net-centric and enterprise connection that adds this quarter, excluding the SIP impact? That I was hoping you could give us what the revenue impact of the SIP shutdown could be, because it did sound like was a September 30th shutdown. And then can you help us sort of bridge from 3Q to 4Q from a revenue standpoint across the three customer segments? And we talked already about the 11,000 non-core connections that you still have. How much of that will be end-of-life at the end of next quarter would be helpful to get the trajectory of revenue, right? Thanks.
Dave Schaeffer: Yeah, so I’ll start by taking those in reverse order, Brandon. The first one is the 11,000 non-core connections that we have are across 23 product categories. They will go away much slower. SIP was the largest of these categories. It was the one that also had the most notice requirement, because it was regulated. At least one customer protested to the FCC that the 1-year notice that they received was inadequate and wanted an extension, which was not granted. But, out of the 19,000 non-core connections, we went after the biggest group first, the SIP, and then for the others, products are much more heterogeneous and the path will be much longer. I would suspect we’ll see a reduction every quarter, but it’s probably going to take until the end of 26 till these non-core products are completely eliminated. It is a major component of our cost savings.
Thaddeus Weed: I can repeat the customer connections for you. So the SIP connections were 8,486 at the end of last quarter. Those are all non-core connections. When you look at corporate, net-centric, and enterprise of the 8,486 connections, 5,006 were corporate, 1,088 were net-centric, and 2,392 were enterprise. And that’s the numbers at June 30, 2023, and obviously at 930 those numbers are zero.
Dave Schaeffer: Yes, so for the remaining 11,000 non-core connections, they are spread across all three customer types. I will say that there’s less net-centric even than there was for SIP. So, it’s probably roughly 80% of it is in the enterprise base and corporate base, and less than 20% of it would be in net-centric.
Brandon Nispel: Did I just follow-up? Did you guys say that these products were end-of-life at the end of September, and so there’s a revenue impact in the fourth quarter? I think that’s what I’m trying to get at, because obviously this quarter, I mean trends were below expectations and it doesn’t make sense that it was the SIP in fact that that was shut down at the end of the quarter. So just trying to understand sort of where we should be going and looking for in terms of total revenue next quarter? So there isn’t sort of a big headline [in this stage.] [ph]
Dave Schaeffer: Yeah, I might disagree with that statement, but we ended up pushing these customers on almost a weekly basis reminding them this product was going away. So the stragglers were shut off at the end of the quarter. So the product is completely gone. It is end of life. But the revenue was declining ever since we acquired the business, actually it was declining under T-Mobile’s ownership, and it was a big contributor to why the revenue run rate at signing was $560 million and was down to about $485 million at closing 9 months later, a lot of it was runoff in these non-core products and in SIP, in particular. We, I think, pushed even more aggressively. So while the unit count was down materially, the revenue impact from these end-to-life products in the third quarter was not very material.
Brandon Nispel: Got it. Can I just do one more of the thousand in wavelength in terms of backlogs? What percentage of those were signed during the quarter and then what’s the average sort of provisioning timeline on the thousand that you have in backlog? Thanks.
Dave Schaeffer: So I would say the majority of them were signed in the quarter. Some were actually signed in the previous quarter on Q2 right after closing. And an average is very misleading on provisioning times, because it’s dependent on the two data centers that need to be connected being wave enabled. It is why I tempered, my backlog comment on saying some of these may never install because people may get frustrated. They are not going to wait 14 months till we have all of the data centers wave enabled. We increased the number of wave enabled facilities by about 25% in the quarter. I think, we’ll see that pace accelerate. If you looked at an average, it’s probably more than 150 days, because you’ve got a subset that are in the kind of 50-day provisioning window, both ends are insights we can do today.
Some are more like 120 days, meaning one site is in the shorter window and one site is in the longer window. And then we’ve got waves to sites that are not yet wave enabled. Now, we’ve told customers we’re working as quickly as we can. They’ve still wanted to sign orders, but some of those may not install, because I’m not convinced the customer’s going to wait 6, 7 months to get a wave. And there could be a subset of those that take that all.
Operator: All right. We don’t hear any responses from Brandon. So for now we’re going to move on to Phil Cusick from JPMorgan & Chase. Your line is now open.
Unidentified Analyst: Hey, Dave, this is Jerome [ph] on for Phil. A couple of follow-ups if I could. You mentioned that corporate grew this quarter. Could you quantify that for us? Has there really been any change in trajectory? Could you talk about customer conversations and corporate? Or are the weaker markets starting to come along? Now should we think about the potential for growth to pick up? Second, could you just talk about the level of SG&A in 3Q and how that should look in 4Q? Given some of the cost cutting that’s going on, how should we think about overall margins heading into the fourth quarter and into 2024? Thank you.
