You know, has all that been, you know, reviewed and re-reviewed by the board, any clarification would be helpful.
Bill Michalek: So in terms of the guidance, I’ll let Cathy speak to this, but the — I think the view is to derisk the guidance. That’s why you saw some lower numbers. And I think the company feels comfortable with what we’re putting out for Q4 and Q1. And Cathy, I don’t know if you want to add to that?
Cathy Behnen: Yes, the answer is yes, we’ve gone through it project by project. And my goal is to provide guidance that I can be confident in, and that’s what we’ve done. And we have a very clear view into the ramp in Q1. So very confident with that.
Donovan Schafer: Okay. And then with the actually, sorry, did anyone else want to comment on that question? Okay. Well then, as a follow-up, talking about — if module imports have improved, we’ve talked before about that really being the hang up and the backlog being skewed to 2P projects and that those tend to be more complex sites. And so those would move to the back of the queue. Since module supply has improved so much, it feels like those waiting in the wings should have been able to kind of kick in the gear and start going. Or otherwise, that narrative is kind of broken down. If it’s just interconnect and financing now. Is there a reason on those aspects why you guys would be disproportionately impacted? I mean, some peers have — it’s not that peers haven’t been impacted at all, but it seems like you are still being disproportionately impacted.
So if it’s not the modules and how is the disproportionate impact landing in you guys around financing and interconnects?
Patrick Cook: So I’ll talk to the module piece. We are seeing modules ultimately come in. And Donovan, you’re right, 2P sites are inherently ultimately more complex. But if you think about developers and how they engage with the EPCs, they’re building out their kind of construction schedule. So a lot of the 1P sites are still continuing to get done and some of the 2P sites, just based on EPC availability are still kind of forecasted to go mid to late 2024 and into 2025. And those schedules are being set in Q3 and Q4, ultimately, of 2023 as they build some of these 150 to 200 megawatt sites.
Bill Michalek: And to that, in general, we’ve seen some of the same things that industry have seen around financing, panels, labor, permitting, renegotiating PPAs. I mean those sides of things we have talked about last quarter are seeing a general pushout in backlog. Around the 2P, we have a number of projects that if they were scheduled to move forward with the project, but they didn’t have modules. They’ve renegotiated from now. So a project that would have been scheduled to go six months ago, maybe it’s now going to go in late ’24 and ’25. And so that’s the new schedule for that particular project. But that’s the only other thing I’d add there.
Shaker Sadasivam: Bill and Donovan, this is Shaker. I’m sorry, I had trouble with the audio, and I can address the question with the leadership change. And Donovan, again, thank you for the question. We talked in the prepared remarks about repositioning the business that we have — the work that we’ve done in the last two years. And essentially, a lot of the work we’ve done has improved our cost structure and the competitive positioning. The organization is also a lot leaner, and we have filled gaps in our product portfolio. And really, in the April May time frame, we were very optimistic on the business outlook. But really, what was happening is we were not getting the POs. So the Board really started getting into the details, and we found a lot of opportunity for improvement in just the basic blocking and tackling and execution issues.
In particular, we found our opportunities to accelerate decision-making and how it was coordinated across the organization, closing gaps with product portfolio faster and increasing customer interaction, so there’s better linkage between revenue forecast and PO attainment. So that’s the reason for the change. And hopefully, that answers your question.
Donovan Schafer: Okay. That is helpful. And then just if I can get one last question — one last more in on the credit charge. So with the $4 million credit provision tied to one customer. Can you clarify, is that a case where the — you guys and the customer, there’s agreement or they share your understanding around the idea of what is the total amount of monies owed for goods and services provided? Or is there actually — and they just don’t have — and they’re just not paying it? Or is it a case where they’re actually in some way disputing or they don’t share your view and they don’t think they or have reason for withholding that $4 million?
Cathy Behnen: Hi, Donovan, thanks for the question. No, there’s no dispute. The customer understands the value of the receivable, it’s strictly collectibility and ability to pay issue.
Donovan Schafer: Okay. That’s very helpful. Okay, thank you guys. We’ll take the rest of my questions offline.
Operator: Thank you. Please standby for our next question. Our next question comes from the line of Amit Dayal with H.C. Wainwright. Your line is open.
Amit Dayal: Thank you. Good morning, everyone. Most of my questions have already been addressed. But I was just wondering if you had any projects that have been canceled? I know backlog is a little bit higher, but are there any project cancellations that are impacting near-term results and outlook?
Patrick Cook: No, we haven’t seen — thanks for the question. We haven’t seen any projects that were — that have been canceled, just pushed to the right.
Amit Dayal: Okay. Understood. And in non-UFLPA orders, I think you guys gave a number last quarter. I don’t see it this time. Maybe I missed it. Could you tell us what that number looks like?
Patrick Cook: Yes. I mean in terms of the non-UFLPA for the awards that we signed up this quarter, all of those are not subject to UFLPA and all of the projects have panels.
Amit Dayal: Okay. Thank you for that. So given you have a pretty positive outlook for 2024, do you think you potentially could see sequential improvements through the year-end 2024 after the bounce back, say, relative to Q4 ’23? Or do you not have any visibility at this point to kind of give us that kind of outlook?
Bill Michalek: So we haven’t guided — beyond Q1 for 2024. But we had indicated in the last call that we expect the ramp to start in Q4 and now you’re seeing that ramp start now here in Q1. So as these projects, particularly the almost 700-megawatt project is one example that Patrick called out, that’s one that’s going to contribute here in Q4 and ramp into next quarter. So that kind of give you an indication of how the — we’d expect things to start to ramp on those projects that we talked about last quarter.
