Jeff Van Rhee: Got it. Okay. I’ll leave it there. Thank you.
Robert Lyons: Thanks, Jeff.
Operator: [Operator Instructions] Your next question comes from the line of Cooper Belanger from TD Cowen. Please go ahead.
Cooper Belanger: Hi, everyone. Thank you. As mentioned, my name is Cooper Belanger. I was hoping that you guys could provide some color on plans to address refinancing your convertible debt due in 2025. And as part of that, is there a leverage level that banks want to see for you to be able to refinance that? Thank you.
Robert Lyons: Yes. Thanks, Cooper. Let me frame it up, and then I’ll let Stephen weigh in as well. So one of the things when we look at the – we actually say our four pillars of our strategy. The first is improved profitability. The second is expand ARR revenue, and the third is extend our products into ARR areas. The fourth, we don’t talk about publicly too much is really align our capital structure to support the strategy. So we have the same time horizon. And in that, there are really two focuses. One is the convert, obviously, as you point out, in the second is making sure that we have adequate liquidity to be able to fund the growth that we want to have. And we’re very, very focused on both of those things. I can tell you that we – Stephen and I spend a significant amount of time on those topics, exploring a number of venues ranging from a full range of possibilities.
But what I will tell you is that all roads lead back to getting as much EBITDA – hitting our EBITDA targets going into 2025. If we can hit the EBITDA targets that we have and continue on the successful path that we’re on, that gives us a lot of optionality ranging from retiring it to converting it to something else. And so – while we certainly explore options today. The best path for us is to continue on this profitability path, and make sure that we’re putting adequate EBITDA on the bottom line going into 2025, so that we give ourselves the most optionality.
Stephen Cumming: Yes. And just to add to that, I mean, I think given Cooper, given the significant progress we have already made and the changes to our financial model and the re-profile cost structure, to Bob’s point, we expect to be in a much better place really in the — over the next few quarters to just look at that. And obviously, we’ve got time on our side. I think it’s worth adding that refinancing – is one option. And we know where we need to be as we come into 2024 in order to do that. But we’re looking at many other options as well. So not just a refi, obviously can’t talk about many of them, but we’re looking at a number of options, but refi being one of them.
Cooper Belanger: Thank you.
Operator: Your next question comes from the line of Rudy Kessinger from D.A. Davidson. Please go ahead.
Unidentified Analyst: Hi, this is [Lucky] on for Rudy. Thanks for taking our question. Can you clarify does positive EBITDA in Q4? Does that also equal a positive free cash flow in Q4? And if not, when might we expect to see positive free cash flow? Thanks.
Stephen Cumming: Yes, this is Stephen. We actually haven’t guided to positive EBITDA in Q4. Our plan is to break even. I’m pleased with the progress we’ve already made in Q2. Our EBITDA was better than we guided, and we expect to see sequential improvements throughout the second half. But we’re really looking at sort of a break-even EBITDA number. You can see from our balance sheet, where we have been catching up nicely on some of the payables associated with Edgecast acquisition and some one-time events. So, I think – our cash flow will be a little bit behind that as we go into 2024. I don’t want to pinpoint exactly – an exact timing of it. But certainly, with the progress we’re making on the cost takeout. So, we should be in good shape as we go into ’24.
