• Revenue: $487 million, a 35% year-over-year increase.
• Recurring Revenue Growth: Over 80% year-over-year growth.
• Software Revenue: More than doubled year over year.
• Software Margins: Over 65% for the first time in a quarter.
• Backlog: $22.4 billion in committed contracted orders.
• Net Loss: $19 million for the quarter.
• Adjusted EBITDA: $18 million, above forecast.
• Cash and Equivalents: $903 million, up from $727 million in the previous quarter.
• Cash from Operations: $205 million for the quarter.
• Second Quarter Revenue Outlook: $510 million to $530 million.
• Second Quarter Adjusted EBITDA Outlook: $26 million to $30 million.

• Warning! GuruFocus has detected 5 Warning Signs with SYM.

Release Date: February 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Symbotic Inc (NASDAQ:SYM) reported a 35% year-over-year revenue growth in the first quarter, reaching $487 million.
• The company successfully completed four system deployments and began four new ones, increasing the total operational systems to 29.
• Software revenue more than doubled year-over-year, with software margins exceeding 65% for the first time.
• Symbotic Inc (NASDAQ:SYM) closed three acquisitions in the last seven months, including Walmart's Advanced Systems and Robotics Business, enhancing its technology and market position.
• The company ended the quarter with a strong cash position of $903 million, up from $727 million in the previous quarter, driven by $205 million in cash from operations.

Negative Points

• Symbotic Inc (NASDAQ:SYM) reported a net loss of $19 million for the quarter.
• Operations Services posted a negative gross profit due to increased resources needed to support certain sites.
• Operating expenses increased sequentially due to investments in growth and recent acquisitions.
• The company expects a sequential increase in operating expenses in the second quarter, impacting adjusted EBITDA.
• The deployment of new systems remains lumpy, with only four new starts this quarter compared to nine in the previous quarter.

Q & A Highlights

Q: Can you discuss the expected increase in operating expenses for the second quarter and when you might reach a stable run rate for OpEx? A: Carol Hibbard, CFO, explained that they expect a $5 million to $10 million increase in OpEx for the second quarter, driven by long-term business investments and acquisitions. The increase is primarily in SG&A, and they anticipate a moderation in OpEx between R&D and SG&A in the future.

Q: What caused the operations services loss this quarter, and how should we think about gross profit for that business going forward? A: Carol Hibbard noted that the loss was due to supporting several large systems going live, which required additional resources. This is expected to continue in the near term but not at the same level, as they focus on reliability and customer support.

Q: How is the transition to in-sourcing progressing, and what impact does it have on margins? A: Carol Hibbard stated that the transition to in-sourcing is on track, with all work now in-house. They expect to see the first systems where Symbotic performed the EPC work completed in the next quarter, which should help manage schedules and improve system gross margins.

Q: Are there any changes in customer discussions or budget considerations for 2025 compared to last year? A: Richard Cohen, CEO, mentioned that there has been increased interest from various categories, including manufacturers and international inquiries, due to concerns about labor situations. They are encouraged by the new customer inquiries and orders, particularly from Walmart.

Q: How are you managing potential impacts from tariffs and labor price inflation? A: Carol Hibbard explained that the impact from China is immaterial, and they have contracts that typically allow for cost pass-throughs. They are working with suppliers to buffer against labor price inflation and are monitoring opportunities to offset costs.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.