Operator: Our next question comes from the line of Damian Krauze with UBS. Please proceed with your question. Damian, your line is live.
Damian Krauze: Hi. Good morning, everyone. I apologize. I was on mute. And thank you for taking my questions this morning.
Steve Smith: You’re welcome. Good to meet you.
Damian Krauze: So we have been seeing the retail sales data trending positively year-to-date, the last several months. I was curious if you might be able to elaborate a little bit on the kind of trends you’ve been observing in your business so far year-to-date. And I guess if you were to kind of strip out the positive impact from your acquisition, could you maybe give us a sense on like where underlying sales are trending through March?
Steve Smith: Yes. So nice to meet you, and thanks for joining the call. Yes, I would call our activity sort of level, if you will, with Q4, meaning that the activity hasn’t exploded, I think, I would just call it somewhat consistent in level, the interest level from our retail customers. I, too, I’m bullish that retail is in the early stage of come back. There’s less and less articles out there about store closings with some major retail names than there is about store openings at this point. We love the acquisition that we made with macro because it gets us into food. And food and retail is a really good place to be. I just like — I like the chances of everybody continue and eat. So grocery, quick-serve restaurants, tea stores and the like, we think, are going to bode very well for us on a go-forward basis.
And by the way, by acquiring macro, we didn’t just start to get into grocery. Grocery has been a longstanding vertical for DecisionPoint go back 20 years to our roots. So we have other customers in the grocery and vertical in general, and that augmented and complemented specialty retail and fashion retail, for example, other segments of the retail industry we’re in. But I would set your expectations that — things are stabilized. I think the second half could be robust. We’ve got an election coming up. So the macro trends should be favorable.
Damian Krauze: Okay. That’s very helpful. Thank you. I guess a follow-on to that. When you have conversations with your customers, what is it that they tell you it would kind of take to drive that inflection that resumption of CapEx. Is there anything that kind of stands out that you sense is kind of the limiting factor or what it would take to kind of drive that reacceleration, if you will.
Steve Smith: Yes. The first thing they point to is interest rates, right, which have been favorably coming down in the last three, four, five, six months or so. I mean so with interest rates coming down, spending at the consumer level picks up, right? People get a little bit more bullish, they get less conservative, and they go out and start spending. So in general, I think the first thing that they point to would be interest rates. And I think that’s been favorable. I don’t know even know what I would put second, but that’s a heavyweight one. And just really is responsible for the overall sentiment, I believe, of the marketplace and the economy in general, which helps spending.
Damian Krauze: Fair enough. Well, hopefully, Chairman Powell and the squad can start pushing things in the more favorable direction for you. One final question I have. I don’t know to what extent you’re participating or view RFID as an opportunity. But if it is relevant, could you let us know how you’re viewing RFID? UPS has been out there recently talking about deploying RFID. I would appreciate any of your thoughts on that technology.
Steve Smith: Yes. So I’ve been in this industry for 29 years and were — was around during the initial hype around RFID, which might go back 20 years now. But RFID has had a resurgence here in the last couple three years, First, the application and use case areas. Some retailers are actually using RFID a checkout. But more so, the common application areas and use cases exist in the warehouse distribution center and the like where packaged in the case of UPS, packages can be tracked more efficiently and effectively, depending on the use case. Again, there’s still a cost for the label with an RFID tag in it. But the application and use cases are showing themselves. I attended an industry event in Atlanta, MODEX just a month ago.
And I was flabbergasted floored at the — first of all, the exhibitors and their booths, I mean, and their offerings, which included RFID, that was a big time show that really spoke to what’s happening in industrial automation and supply chain in general. So — and there’s a lot of RFID speak and including us, we had featured ViziTrace which is an offering of ours that enables someone to manage a wide variety of RFID technologies. And we were busy as to be. So we see an individual pickup, but I don’t think that’s where your question is rooted. I think in general, at a macro level within this industry, RFID has had a resurgence in the last couple or three years. And I would anticipate it’s starting to live up to its hype of yesteryear.
