OESX

Good morning, everyone, and welcome to Orion Energy Systems Fiscal 2026 Third Quarter Conference Call. [Operator Instructions] In this call, Sally Washlow, Orion's CEO; and Per Brodin, its CFO, will review the company's third quarter results and its fiscal 2026 and fiscal 2027 outlook. We will then open the call to investor questions. Today's call is being recorded. A replay will be posted in the Investors section of the company's website, orionlightning.com. I will now turn the call over to Per Brodin, Orion's CFO. Please go ahead.

Thank you, Michelle. First, a reminder, prepared remarks and answers to questions include statements that are forward-looking under the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally include words such as anticipate, believe, expect, project or similar words. Also, any statements describing future objectives or goals, company plans and outlook are also forward-looking. These forward-looking statements are subject to various risks that could cause actual results to differ materially from our current expectations. Risks include, among other matters, those that Orion has described in its press release issued this morning and in its SEC filings. Except as described therein, Orion disclaims any obligation to update or revise forward-looking statements made as of today. In addition, reconciliations of certain non-GAAP financial metrics to their nearest GAAP measures are also provided in today's press release. Now I'll turn the call over to Orion's CEO, Sally Washlow.

Thank you, Per. Good morning, everyone, and thank you for being with us today. I am delighted to report our results for Q3, our fifth straight quarter of positive adjusted EBITDA. In our last investor call, I said that we were on track to achieve 3 milestones in FY 2026. Milestone one, maintain our NASDAQ listing and maximize our opportunity for growth and shareholder value. As our shareholders can attest, we have checked that box. Milestone two, by the end of third quarter, the enactment of a growth, profitability and cost containment initiative that enables Orion to become a recognized long-term market leader. As today's earnings report can attest, we have checked that box too. And milestone three, by the end of the fourth quarter, $84 million in revenue at or near a positive adjusted EBITDA for the full fiscal year. As we announced 2 weeks ago, we believe we are on track to meet or exceed this milestone. The most illustrative way to bring you up to date about Orion is to review the 2 news items we announced a couple of weeks ago. First, we upticked our guidance range for our current fiscal year and set expectations for increasingly profitable growth in our next fiscal year, which begins April 1. We raised our FY '26 outlook to a range of between $84 million and $86 million in revenue at positive adjusted EBITDA. Again, that's up from our previous outlook of $84 million in revenue at or approaching positive adjusted EBITDA. Our guidance range increase was sparked by our Q3 expectations of about $21 million in revenue and our fifth straight quarter of positive adjusted EBITDA, which are indeed the results that we are reporting today. Additionally, we now expect positive adjusted EBITDA for the full FY '26, which ends March 31. We expect continued up and to the right profitable growth in FY '27 with positive adjusted EBITDA on revenue between $95 million and $97 million. We based our uptick on increasing orders and the success of our recent cost structure improvements. A few of these recent orders include an exterior lighting project valued between $14 million and $15 million beginning now in our current Q4 with the bulk of it completed in the first half of our FY 2027. This is an example how we expand our scope of work within our current customer base. We expect more of this expansion in FY '27, along with more new customer wins as well. Our strategy to expand the products and services we provide is exemplified by the recent 3-year renewal of a maintenance contract as well as our growing backlog. We grow our business by listening to our customers and developing the products and services they need. Another area of focus that we are continuing to quote and win more and more work is within electrical infrastructure, which we define as integrated offerings within our LED lighting and EV charging lines of business. An emerging example of this for some customers is our initial integration of a localized battery storage solution that enables facilities to minimize cost and maximize efficiency by drawing on stored energy. Another example is the Orion Voltrek announcement just this week of our latest work for the Boston Public School System, a $4 million installation of 105 EV charging stations and related infrastructure. Orion Voltrek is a recurring partner in the BPS initiative to electrify 100% of the district's 750 school buses, the largest school bus electrification program in the Northeast. As I've said before, a number of industrial, commercial and public sector facilities operated by some of the largest enterprises in the United States rely on Orion. Year after year, our largest long-time customers stay with us and grow with us because we deliver unsurpassed quality and unsurpassed ROI on an ongoing basis. One reason that they rely on us is that we are reliable, in part because our proprietary supply chain enables us to maximize efficiencies, minimize dwell times and avoid choke points. As they also know that our built from the ground-up supply chain also helps insulate us from the risk factors associated with the headlines of the day. Another reason our customers rely on us is that we earn more of their confidence the more we do with them. That includes retailers, 2 of the largest automakers on earth and one of the biggest school systems in America. Customers require the most demanding standards of efficiency, reliability and compliance, repeatedly increase our scope of work because we deliver on time and on budget. We see increasing market -- customer and market demand ahead of us as evidenced by our uptick expectations of growth and profitability through FY '27. We expect to benefit from market tailwinds, especially in building, reshoring and refurbishing industrial facilities ranging from data centers, to manufacturing plants, to big box retail stores and public sector buildings. EV fast charging continues to be an area of opportunity according to Paren research. While the U.S. EV charging market faced uncertainty in 2025, the most recent Paren report expects 8% growth in 2026. Paren also cites growth trends in ports per site and rip and replace of existing EV charging infrastructure. It foresees what it calls a private-led expansion and improved CPO economics. The report puts a premium on execution, quality and asset efficiency. We believe we have rightsized and recalibrated Orion for that environment that Paren describes, and we believe that puts us in position for market expansion, product extensibility and profitable growth. We could not be more energized about the remainder of the current fiscal year and the entirety of the next year. With that, let me turn to Orion's CFO, Per Brodin, to review our financial performance and outlook.

Thank you, Sally. Today, we reported fiscal Q3 '26 revenue of $21.1 million compared to $19.6 million in Q3 '25. LED lighting segment revenue was $12.1 million compared to $13.2 million in Q3 '25, reflecting decreased project activity and ESCO channel sales, partially offset by an increase in distribution channel sales. Orion's expanded LED lighting project pipeline and efforts to drive growth in the distribution channel are expected to continue to contribute to higher revenues in Q4 '26 and into fiscal '27. In addition, we are expecting a very strong Q4 from the turnkey Group. Lighting achieved a Q3 '26 gross margin of 30.6% versus the 30.2% in Q3 '25 with pricing increases, cost reductions and sourcing initiatives amplified by a more favorable Q3 '26 project and revenue mix contributing to this performance. Maintenance segment revenue increased 13% to $4.4 million in Q3 '26 from $3.9 million in Q3 '25, reflecting the benefit of new customer contracts and the expansion of some existing relationships. We achieved a maintenance segment gross margin of 25.5% in Q3 '26 versus 26.4% in Q3 '25. EV charging solutions revenue was $4.7 million in Q3 '26 compared to $2.4 million in Q3 '25, reflecting the expected completion of a significant project within the quarter. EV achieved a gross margin of 36.7% in Q3 '26 versus 30% in Q3 '25. Our overall gross profit margin increased to 30.9% versus 29.4% in Q3 '25, reflecting pricing and cost improvements in all segments, particularly LED lighting and EV. We expect our overall gross margin to remain strong in Q4 '26 and throughout fiscal '27 that will likely vary on a quarterly basis due to revenue mix and volume. Total operating expenses declined to $6.1 million in Q3 '26 from $7 million in Q3 '25, reflecting ongoing overhead and personnel expense reductions. Reflecting stronger gross margin and lower operating expenses, Orion's Q3 '26 net income was $160,000 or $0.04 per share compared to a net loss of $1.5 million or $0.46 per share in Q3 '25. Adjusted EBITDA improved to positive $761,000 in Q3 '26 versus $32,000 in Q3 '25, reflecting continued cost control and financial discipline. As Sally mentioned, this was Orion's fifth consecutive quarter of positive adjusted EBITDA. That puts our trailing 12-month adjusted EBITDA at $1.6 million on sales of $81.5 million. Year-to-date cash provided by operating activities was $400,000 through Q3 '26 compared to $1.3 million in the prior year period. During the year, we have also had a $1.3 million net paydown of our revolving credit borrowings. Net working capital was $8.9 million at Q3 '26 versus $8.7 million at year-end. Available financial liquidity was $11.8 million versus $13 million at year-end. Notably, we recently raised net proceeds of approximately $6.4 million through the issuance of 500,000 shares of common stock, which provides us with growth capital and the ability to pay down amounts outstanding on our revolving credit facility. Regarding our outlook, as Sally noted, last month, we increased our expectations for growth and profitability for our current fiscal year and set expectations for increasing growth and profitability in our next fiscal year, which begins April 1. We raised our fiscal '26 outlook to a range of between $84 million and $86 million in revenue at positive adjusted EBITDA. That's up from our previous outlook of about $84 million in revenue at or approaching positive adjusted EBITDA. And now we expect positive adjusted EBITDA for the full fiscal year '26, which ends March 31. We also announced that we expect a continued increase in profitable growth in fiscal '27 with positive adjusted EBITDA on revenue between $95 million and $97 million. And this concludes our prepared remarks. Operator, would you please now commence the question-and-answer session.

[Operator Instructions] Our first question comes from the line of Eric Stine with Craig-Hallum Capital Group.

So maybe just starting with the external lighting project, the $14 million to $15 million, obviously, very good to see. Just curious, I know some contribution in Q4, but maybe just for help on our side, any early thoughts on kind of linearity of revenue 1Q, 2Q of fiscal '27. And then it also sounds like you're pretty optimistic that -- I know you've been doing work with -- significant work with Home Depot over time, but that this $14 million to $15 million has some expansion potential with it as well.

Eric, it's Per. I think maybe the way to think about it is we did start with some of those projects in, say, late January of this quarter. We expect that effort to ramp in January, February and March and have said we expect the majority of that revenue to hit in the first half. And actually, we expect to be complete by the end of July. So I would think that there's some initial revenue ramp in the fourth quarter here of '26, then I would expect that over those first 5 months of fiscal '27, it will be a little bit more of a steady earnings on revenue.

Got it. That's helpful. And then the expansion potential [indiscernible] that project, if there is some, then maybe expand on that.

Yes. Eric, we think that there's potential expansion, as we've noted with -- in this customer. We work closely with them day in and day out. That probably would not be in the, we'll call it, the first half of the year as we continue to be a partner with them.

Okay. And then just second one quick. Very good to see the OpEx come down again. Per, I believe you termed it as a result of ongoing cost reduction initiatives. So where could that potentially go? I mean is this kind of a quarterly run rate we should think about? Or is there a potential further reduction?

We'll continue to try to manage those operating expenses as closely as we can. I think a lot of that effort, as you would suspect, ends up being finding cost savings to mitigate other cost increases. So I would think that ongoing expenses would be at that level or potentially slightly more, but probably at least in Q4 that that operating expense number would start with a 6.

[Operator Instructions] Our next question comes from the line of Gashi Rowe with Singular Research.

Can you hear me?

Yes.

Congratulations on your quarter. On the maintenance side, you clearly had some big win at a large retailer. I'm curious as to about the next tier of customers. Are you seeing those smaller midsized enterprises adopt a similar preventative maintenance model? Or is this still more of a one customer phenomenon at this stage?

Thank you. So no one to the scale that this large retailer is for us in that division, but we are seeing increases month-over-month within some of our other customers and continue to pursue new customers and contracts within the space.

Got you. And with the strong run of contract wins with a handful of large customers, can you talk about how you are underwriting the execution risk? I know in the past, you've seen some -- experienced some delays. Any kind of orders or penalties? How much room is there in your margins and guidance if one of these programs experiences the kind of delays that you have seen in the past?

I think that risk exists on an ongoing basis, and we say, temper our outlook with that potentiality. So I would say that we have tried to take into account any issues that might arise that we have at least some visibility to at this point.

Our next question comes from the line of [ Matt Dunn ] with Tieton Capital Management.

Great. That's Matt Dane with Tieton Capital. I wanted to ask about the distribution segment. You referenced that you're seeing some success there. Just wanted to get a little bit more color around that. What's driving that success? And what type of runway do you see with that as well?

Matt, so driving that success, we're out there with the customers expanding our relationships. As noted, we expanded the team that calls on that channel earlier this year, and that's proving to bear fruit. And also, we're looking at developing products from the request of customers in that channel as well. So we expect to engage further in the channel and deliver the products that they're asking for us to deliver as well.

Great. I did also want to ask about the infrastructure opportunity, electrical infrastructure opportunity. How much revenue are you getting from that newer area of your business to date? And I guess I just have a hard time really sizing how large the opportunity is over time. What can you share around all that?

So the shape of the revenue that we get is certainly evolving from what traditionally we'd say product sales and some of that even comes from the EV segment and the installation that we do there. But where -- and we're developing this. So I guess I don't have a hard number for you. But where we're getting some of these projects from is expansion within maybe an installation job that we had and there's expanded work to do on site. We're there, and they're requesting us to do that expansion of work, which can be 7 figures in terms of the scope of those jobs that they ask us to do. So initially, when we got there, we didn't expect it, and then it's further grown.

Okay. And so is it -- how significant is the revenue that is contributing so far? Or is it still -- it's really not a huge amount of revenue and it's more of a future expected additional revenue that is going to add?

Yes. We're continuing to build it. And as we build out our plans for next year, we look at what the potential of this could be.

Maybe a different way to think about it, Matt, is we have had some good wins on that standpoint, both from, I'll say, an overall win on a couple of jobs. And we've also had, to Sally's point, a couple of expansions on what started as lighting projects that is not yet fully in our results through the end of Q3. A lot of that is, I'll say, one business, but some of that will be recognized in Q4, and some of that will go into fiscal '27, and we're hoping to build on those successes as we go. So it's a little hard to size it at this point.

This concludes the question-and-answer session. I will turn the call back over to Sally Washlow for concluding remarks.

I want to thank everyone again for taking time to join us today. We look forward to updating investors on our fourth quarter call in early June. Between now and then, we look forward to meeting with many of you or to meet whether it's in person or virtually. We will be presenting at a number of conferences, so please watch for our forthcoming announcements regarding scheduling. Please also reach out to our Investor Relations team to set up a meeting or for any other information. Their contact information is at the bottom of today's press release. Many thanks again for your interest in Orion. I look forward to continuing to update you on our progress.

Thank you. This concludes today's conference call. You may all disconnect. Everyone, have a great day.

Good morning, everyone, and welcome to Orion Energy Systems Fiscal 2026 Second Quarter Conference Call. [Operator Instructions] In this call, Sally Washlow, Orion's CEO; and Per Brodin, its CFO, will review the company's second quarter results and its fiscal 2026 outlook. Then we will open the call to investor questions. Today's conference is being recorded. A replay will be posted in the Investors section of the company's website, orionlighting.com. I will now turn the call over to Per Brodin, Orion's CFO.

Thank you, Rica. First, as a reminder, prepared remarks and answers to questions include statements that are forward-looking under the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally include words such as anticipate, believe, expect, project or similar words. Also, any statements describing future objectives or goals, company plans and outlook are also forward-looking. These forward-looking statements are subject to various risks that could cause actual results to differ materially from current expectations. Risks include, among other matters, those that Orion has described in its press release issued this morning and in its SEC filings. Except as described therein, Orion disclaims any obligation to update or revise forward-looking statements made as of today. In addition, reconciliations of certain non-GAAP financial metrics to their nearest GAAP measures are also provided in today's press release. Now I will turn the call over to Orion's CEO, Sally Washlow.

Thank you, Per. Good morning, and thank you for being with us today. I am extremely pleased to report our Q2 results, highlighting a year-over-year increase of more than 1/3 in gross profit. This is also our fourth straight quarter of positive adjusted EBITDA. We recorded incremental growth in total revenue and significantly more than that in maintenance services, even as we unburdened ourselves of an unprofitable contract. And we saw a welcome bounce back in EV charging as the sector-wide uncertainty of the earlier part of the year began to dissipate. When we last convened, I said that we are on track to achieve 3 milestones in fiscal 2026. Milestone 1, by the end of the second quarter, a positive resolution that enables a publicly traded Orion to maximize its opportunity for growth in shareholder value. We achieved that by maintaining our NASDAQ listing. Milestone 2, by the end of the third quarter, the enactment of a growth, profitability and cost containment initiative that enables Orion to become a recognized long-term market leader in its core businesses. This is already contributing in the second quarter as we reported 34% higher gross profit and the fourth straight quarter of positive adjusted EBITDA. Milestone 3, by the end of the fourth quarter, $84 million in revenue at or near a positive adjusted EBITDA for the full fiscal year. We are on plan and our expectation for the fiscal year is unchanged. We have only just begun, and we are demonstrating building towards sustainable and profitable growth beginning in the second half of this year. Even in these early innings, it is gratifying to see that our work is being increasingly recognized and not just by our shareholders. Our partners and customers have long recognized Orion as their go-to partner for installation, ongoing maintenance and managed services for LED lighting and EV charging. We are also seeing an increase in activity related to quoting and winning work within electrical infrastructure. As I noted in our last call, industrial, commercial and public sector facilities operated by some of the largest enterprises in the United States rely on Orion. With products made in America, along with the global supply chain and now in our fourth decade, Orion serves as a go-to provider to Fortune 100 corporations and other global leaders in sectors ranging from manufacturing to government to retail. A recent illustration is last month's announcement of a major retailer's 3-year renewal with us, representing reoccurring revenue of between $42 million to $45 million. Our largest long-time customers stay with us year after year because we deliver unsurpassed quality and unsurpassed ROI. Whether deployed independently or in a combination with our ESCO and distribution partners, Orion solutions deliver unrivaled ROI to industrial facilities requiring the most demanding standards of efficiency, reliability and compliance. That recognition serves us particularly well at this pivotal moment. Just in Q2 alone, we saw an upswing in the lighting market with the recent Dodge Momentum Index report that commercial, industrial and public sector construction planning is 33% ahead of year ago levels. We see an improved outlook in the EV charging market with the confidence boosting federal declaration reassuring the availability of $5 billion in government EV charging funds. We are beginning to see increased opportunities for electrical infrastructure installation and maintenance with megatrends from reshoring to refurbishing to replacing manufacturing and other industrial plants in the United States. All of these tailwinds mean that Orion has a multi-sector reoccurring revenue win at our back, whether it is in lighting, EV charging or maintenance services. As I promised on our first call, we will continue to keep you apprised with increasing frequency and with increasing granularity throughout this fiscal year and beyond. Now drilling down further on the second quarter. Once again, Q2 featured solid stability and progress in our 3 business lines as well as positive guideposts for the rest of the fiscal year. The quarter resulted in enhanced margins, reduced costs and meaningful progress on the bottom line. We remain in a solid position for the full fiscal year. Orion's Q2 '26 revenue was $19.9 million versus $19.4 million in Q2 '25. Q2 '26 gross profit grew 800 basis points to 31% versus 23.1% in Q2 '25, and we achieved our fourth consecutive quarter of positive adjusted EBITDA. Per will provide details in a minute. Let's look at a quick snapshot of some of the highlights from Q2, which featured solid accomplishments in our 3 business lines. In Lighting, we had some significant new business wins exemplified by $11 million in government lighting and up to $7 million in LED lighting for facilities belonging to some of the biggest names in the automotive industry. In EV charging, we saw a welcome bounce back from the uncertainty that the entire EV sector experienced in the first few months of the year. A particular Q2 highlight was the $8.5 million in EV charging work in Massachusetts. We also saw the continence boosting federal clarification reassuring the availability of $5 billion in government EV charging funds. In maintenance, these and other engagements featured ongoing managed services that ramp reoccurring revenue and ensure a close, continuous and expanding relationship with our enterprise customers. It's also important to note a couple of particular points about Q2. One is that our maintenance services achieved significant growth even while allowing the lapse of an unprofitable contract. Another is that EV charging showed a welcome bounce back from the uncertainty that the entire EV sector experienced in the first few months of the year. Our Q2 gross profit now at 31%, a year-over-year jump of more than 1/3 was also a standout. This was largely achieved by continuing reductions in LED lighting fixture cost via our ongoing improvements in reengineering, plant efficiency and improved sourcing as well as via both margin and volume increases in our maintenance services business. We continue to benefit from the success of our cost control initiatives, and we expect to see ongoing improvement throughout the rest of the fiscal year. On the new business front, we continue to build our expanding pipeline of contracted LED lighting projects even as we penetrate and radiate within existing maintenance services customers. We are laser-focused on increasing sales in our LED lighting distribution business. On the new product front, we continue to gain traction with our value-based LED lighting fixtures. The marquee name here is Triton Pro designed and engineered in response to popular demand from both customers and channel partners. Triton Pro is a competitively priced LED lighting line that is getting traction with a number of customers. We also continue to partner with our customers to bring together seemingly discrete products and services into the connective tissue domain of electrical infrastructure, a name we've been dropping lately, you may have noticed. Electrical infrastructure integrates offerings like LED lighting, high-voltage EV charging stations and a high-impact array of maintenance and managed services. We'll have more to say about this initiative as well. For now, suffice to say that it is in response to requests from our customers as well as those megatrends I mentioned earlier: data centers, AI, manufacturing, retail, electrification, industrial and complete commercial fleet management and others. These are the headlines of the day. You see these headlines in the Wall Street Journal, in Barron's, in your hometown paper. You may have noticed that you see them in Orion press releases, too. Orion sits squarely in the confluence of these megatrends, and it has solutions to not just serve them, but to accelerate them. With that, let me turn to Orion's CFO, Per Brodin, to review our financial performance and outlook.

Thank you, Sally. Today, we reported fiscal Q2 '26 revenue of $19.9 million as compared to $19.4 million in Q2 '25, with 2 of Orion's 3 segments growing year-over-year. LED lighting segment revenue decreased 2% to $10.7 million compared to $10.8 million in Q2 '25, reflecting increased project activity and distribution channel sales, offset by lower ESCO channel sales. Orion's expanded LED lighting project pipeline and efforts to drive growth in the distribution channel are expected to contribute to higher revenues in the back half of fiscal '26 versus fiscal '25. Lighting achieved a Q2 '26 gross margin of 27.5% versus 25.4% in Q2 '25, with pricing increases, cost reductions and sourcing initiatives being amplified by a more favorable Q2 '26 project and revenue mix. Maintenance segment revenue increased 18% to $4.5 million in Q2 '26 from $3.8 million in Q2 '25, reflecting the benefit of new customer contracts and the expansion of some existing relationships. We achieved a maintenance segment gross margin of 23.7% in Q2 '26 versus 15.3% in Q2 '25, as there was a significant inventory charge recorded in Q2 '25 as part of the segment restructuring. EV charging solutions revenue was $4.8 million in Q2 '26 compared to $4.7 million in Q2 '25, reflecting the expected completion of a significant project within the quarter. EV achieved a strong gross margin of 45.8% in Q2 '26 versus 23.7% in Q2 '25 due to a strong improvement in sales mix. Our overall gross margin increased 790 basis points to 31% versus 23.1% in Q2 '25, reflecting pricing and cost improvements in all segments, particularly LED lighting and maintenance. We expect overall gross margin to remain strong in fiscal '26, though it will likely vary on a quarter-by-quarter basis due to revenue mix and volume. Total operating expenses declined to $6.4 million in Q2 '26 from $7.7 million in Q2 '25, reflecting ongoing overhead and personnel expense reductions and earnout expense of $0.6 million in Q2 '25 that did not recur in 2026. We expect operating expense to approximate Q2 levels in the remaining 2 quarters this year. Reflecting stronger gross margin and lower operating expenses, Orion's Q2 '26 net loss improved to $0.6 million or $0.17 per share from a net loss of $3.6 million or $1.10 per share in Q2 '25. Adjusted EBITDA improved to a positive $0.5 million in Q2 '26 versus a negative $1.4 million in Q2 '25, reflecting cost control and financial discipline. As Sally mentioned, this was Orion's fourth consecutive quarter of positive adjusted EBITDA that puts our trailing 12-month adjusted EBITDA at $0.9 million on sales of $80 million. Year-to-date cash provided by operating activities improved to $1.3 million in Q2 '26 from a use of cash of $2.5 million in the prior year period, primarily due to the improved bottom line performance. During the year, we have also had a net paydown of our revolving credit borrowings by $1.25 million. Net working capital was $8.1 million at Q2 '26 versus $8.7 million at year-end, primarily reflecting the use of cash to pay down on the revolver. Available financial liquidity was $13.5 million versus $13 million at year-end. During the quarter, we issued $1 million of common stock and made $875,000 of cash payments to partially satisfy the Voltrek earn-out obligation. Turning to our fiscal '26 outlook. We have reiterated the fiscal '26 revenue growth expectation of 5% to approximately $84 million that we initiated in June. We have also reiterated that our revenue growth outlook positions Orion to approach or achieve positive adjusted EBITDA for the full fiscal year, depending on revenue mix. This growth outlook anticipates modest growth in LED lighting and electrical maintenance revenues and flat to slightly lower EV charging revenues. And this concludes our prepared remarks. Operator, would you please commence the question-and-answer session?

[Operator Instructions] Our first question comes from the line of Eric Stine of Craig-Hallum Capital Group.

So maybe just starting on the EV business. I mean, clearly, a positive development with clarity from the government. And I know that a lot of your business there has been through utility programs. But I guess I'm curious what you are seeing with some of your customers. And I think this maybe goes hand-in-hand with the energy infrastructure initiatives and a bundled offering. But I do know that part of the reason that you made this acquisition a while back is because your customers were requesting these capabilities. So just curious what you're seeing from your enterprise customers.

Eric, yes, we're absolutely seeing some of that from our enterprise customers, bringing whether it's an LED lighting project that would have started out as that, but bringing then EV charging into their parking lots as well. So that is some of the things that we're seeing in that. Our business was -- had a lot of utility programs, but I think you've seen in recent announcements, further expansion of the work with Boston Public Schools, MassDOT, as well as the state continues to build out its infrastructure and then hiring additional salespeople. We hired gentlemen based in our Florida office to help further expand our geographic reach as well. And we have a couple of other areas targeted that we're investigating right now and more to come on that.

Okay. And then, I mean, I guess, segue to energy infrastructure, is this something where you feel like you can accelerate some of that traction if you are going to the market with more of a bundled offering? Or maybe that's -- I'm not sure if that's how you think about it or not, but a bundled offering where, again, a customer just has one point of contact for everything that they want to do.

Yes. We're certainly looking at that, and a lot of it has been developed through customer requests. We're on site. They see the work that we do. An example of this would be it started as an LED lighting project, but maybe they need help bringing their facilities up to code. And then they turn to us to say, "Can you do that and manage that project for us as well?" So those are where the work in electrical infrastructure is expanding, and we're at the very beginning of this as well, but even energy storage so that they look to offload the peak time, so working to develop relationships to bring energy storage into their facilities as well.

Got it. Okay. Maybe last one. Just you had the maintenance agreement renewal. I think we can all kind of guess who that customer is. But just curious, maybe not to that size, given who that customer is, but what are you seeing on that front? Clearly, you are sounding more positive, although modest growth this year, certainly long term on the maintenance side. What are you seeing in terms of demand there from other enterprise customers?

So we have some other customers as well. It's a little bit of a slower build as we work with them. But month-over-month, that revenue is growing with them as well and the trust that they have in us. So we think that, that will continue to expand.

Our next question comes from the line of Sameer Joshi of H.C. Wainwright.

Just a little bit more on the EV outlook. I know you are expecting flat or slightly lower year-over-year growth there. But in terms of the strategy going forward, given that these funds are now -- the $5 billion are being made available, do you expect or are you planning to have some kind of a geographic expansion or maybe a roll-up with some other similar businesses that might increase the size of your EV offering?

Sameer, we are certainly looking at a geographic expansion. And of note, hiring a sales gentleman to lead our Jacksonville office and then other areas of the country as well. The teams are working on mapping out where we best have personnel and then also where there's a lot of EV infrastructure work going on. So we certainly expect further geographic expansion.

Understood. Switching to lighting. I think one of the things I may have misheard, but just making sure the $42 million to $45 million recurring revenue potential, is that over the life of the contract? Or what do those numbers represent?

Yes. It's a 3-year contract renewal. So that's over the life of the 3-year contract.

Okay. And then, of course, I should have started with congratulations on the cost control efforts and the results. But I also heard during the commentary from both of you, the word ongoing. Should we expect further improvements in gross margins to like mid-30s or near that level? And on the operating expense front, I have noticed in the last couple of quarters, your sales and marketing expense as a percent of revenues have reduced. Are there some synergies you are seeing there that we may have missed?

Yes, Sameer, I think a couple of thoughts on those questions. I'll try to catch all of them. On the expense line, I think what I tried to convey is that the Q2, the most recent quarter that we completed from an OpEx standpoint is the level that I think we expect for the next 2 quarters. We are -- I think some of the other comments are aimed at saying that we will continue to look for savings opportunities that are out there. But at the same time, we'll also look for opportunities that we may need to invest a little bit of money as we did with the salesperson in EV because we think that will have a good payback for us as we expand sales in the EV segment. From a margin standpoint, I don't think in the near term, we have an expectation of getting into the mid-30s. I think being in the neighborhood of the high 20s to 30% is probably more realistic. As I mentioned, there will definitely be some fluctuation there depending on mix as well as sales volumes that cover fixed costs within our COGS structure. So hopefully, that clarifies those two.

Yes, understood. Just last one maybe and just a clarification. The $875,000 paid during the quarter, were they part of -- on a GAAP accounting basis from a previous quarter? Or are these $875,000 included in the OpEx that are for the September ending quarter?

The $875,000 that was paid had been accrued as of March 31, as was the $1 million that was paid in equity. So we had the larger accrual at March 31, we made those two payments. And then there's still a remaining balance that as we've disclosed separately, is subject to arbitration. So we expect that to play out over the next quarter or so.

And has that been accrued or is that pending the settlement?

We've accrued what we believe is the appropriate amount, and that was accrued as of March 31.

[Operator Instructions] Our next question comes from the line of Bill Dezellem of Tieton Capital Management.

I have a group of questions. I'd like to start with the Lighting business. You brought in some talent to reignite ESCO distribution revenues. Would you please discuss whether there's been any tangible benefit yet? And I recognize it's very early to ask the question or whether that pipeline is still developing.

Bill, it's Per. Yes, I think in my remarks, I mentioned that in the quarter, our distribution channel revenues increased, and that's where the, I'll say, the main talent addition that we discussed back in the June time frame was mentioned. I think that he has landed on solid ground and with a running start of some sort because of his connections within the industry. And we think that he will continue to build that. That was consistent with another comment I made in my commentary. So I think the ESCO channel, we've not made recent investments from a sales standpoint in that channel, but that is a channel that we will also press on to ensure that we can maximize the opportunities on all 3 of the lighting channels.

So in spite of his short tenure, there already has been a benefit. So if that's the case, presumably one doesn't hit their full stride and at maximum performance in just a few months. So presumably, that business builds and that's part of what your comments were alluding to relative to the remainder of the year?

That's correct. And we have high expectations as we move forward into the next 2 years.

Great. And Per, did I hear you in response to my question, also say that you will be adding additional sales talent in the distribution arena? And if that is the case, are you essentially waiting for a little higher revenue so that you can pay for that individual who will then generate the next level and start layering on top of layers?

No, I did not say that. I'd say that it's something that would certainly be considered as the current executive continues to perform and as we evaluate other opportunities to grow that channel. But no firm plans at this time.

Okay. That's helpful. And then I'd like to shift to maintenance real quick. The quarter you said had a headwind because you had unprofitable maintenance contract that you walked away from. How much of a revenue headwind was that in the quarter?

So we -- I don't have the exact number right now at my fingertips, but it was from last quarter. So quarter-over-quarter as that -- or last year, I apologize. As those contracts lapse, then we're growing the business in other areas was the intent of that.

Last year, we essentially were wrapping up that contract in Q2 of fiscal '25. So there was headwind of a tough comp, but it was not -- I'd just say round numbers, it would have been less than $0.5 million.

Okay. And then did you add any notable business beyond your largest customer in the maintenance arena this quarter specifically?

We have continued to add some customers or growth within customers beyond the large customer. The large customer does take up a significant portion of it. So they're of note to us because they are growing every month, and we'll continue to watch their growth and further partner with them and gain more customers in that area.

Maybe another way to think about it, Bill, is we've gained new customers over the past year, and the business we're doing with them has expanded as we've moved forward in that relationship.

Per, I'm going to build off of that. Do you see an opportunity with those customers to continue to build further as you execute? Or are you now reaching kind of a steady-state run rate with them and you'll be needing to add additional -- not that you don't want to already, but you'll need to add additional customers to build revenue further?

I think it will be a little bit of both. The -- we don't believe we're at run rate with some of these newer customers. So we think that will continue to expand, and we think we will continue to attract new customers as we move forward.

Right. Okay. That is helpful. And then at a high level, do you see the maintenance business as a lead generator for product sales, whether it be lighting or EV?

I mean we are seeing some of that with the maintenance products. Product sales within that segment are increasing. So certainly, we look to all customer touch points as potential lead generators into other areas.

I guess, Sally, where I was going with that is, does it give you a special insight that you may not otherwise have if you weren't inside the customers' 4 walls doing the work?

Yes. So I guess to answer that part of it, absolutely, we see some of that with the expansion of some of the services that we're doing. Had we not been within the 4 walls of the customer and maybe doing work in other areas, and they're asking, "Can you project manage this part of bringing some of our systems up to code as well?" We wouldn't have gotten that business had we not been there working side-by-side with them.

That's helpful. And then I know I'm taking up a lot of time, but one additional question or clarification relative to the EV business. I heard I thought 2 different things in terms of your commentary. One is some level of caution for the remainder of the year for sales there, but that there's also more clarity on the EV rules and that bodes well for the future. So let me try to put a fine point on it here that the Q1 EV revenue was $2.7 million. Here in Q2, it was $4.8 million. Are you anticipating approximately holding at this $4.8 million for the next couple of quarters? Or do you continue to see some level of growth from the $4.8 million?

Yes. I think we're cautious on our guidance for the year because we ultimately lost a couple of months there with all the uncertainty at the beginning of the year. But our expectation is to be flat to a little bit down in EV for the year. But I think your numbers are right in the realm of what we expect to do for the next couple of quarters to deliver on that and start to regain some momentum from what was basically lost or at a standstill in the first quarter.

Our next question comes from the line of Steve Rudd of Blackwall.

Very encouraging results. Can you talk about the cost containment? I mean, obviously, we're seeing top line trend of growth from a cost containment and cost leveraging point of view or infrastructure leveraging point of view, how much more room do we have to go?

If I interpret your question properly. We think we have -- I'll step back. Earlier in the year, we think we rightsized the business so that we could be at or above breakeven in the $80 million to $83 million of revenue standpoint. And that's on an adjusted EBITDA basis. I think now that we have 4 consecutive quarters of positive adjusted EBITDA and $80 million of trailing 12 revenues, I think that's holding true. So -- and then if you look at our guidance, we obviously are expecting a little bit stronger performance in the second half compared to the first half to get to the $84 million. In terms of what we can deliver with the infrastructure that we have, we think that we can leverage this infrastructure quite a bit. There certainly are some variable costs such as commissions on sales. We always are happy to pay increases in commissions because that means our sales are increasing. So there'll be some things like that, that will come to us. But we think on an overall basis, we'll be able to leverage this infrastructure with a fair amount of revenue growth.

So it's your assessment at this point that you have your baseline costs exactly where you'd like them to be and not much more to be done there?

I'd say in general, yes. But to my -- one of my previous comments, you're always looking for opportunities for savings. And some of that you may need to try to find money to invest in growth opportunities, and that's the balance that we'll continue to work on as we move forward.

This concludes our Q&A session. I'll now turn the conference back to Sally Washlow for concluding remarks.

I want to thank everyone again for taking time to join us today. We look forward to updating investors on our third quarter call in early February. In the interim, we hope to have an opportunity to meet with many of you either in person or virtually. We will be presenting at a number of conferences, including the Craig-Hallum Alpha Select Conference on November 18. Details will be coming out tomorrow and the Singular "Best of the Undercovered" (sic) [ Uncovered ] conference on December 11. We will announce details via press releases. Please also reach out to our Investor Relations team with any questions or to set up a meeting. Their contact information is at the bottom of today's press release. Thank you again for your interest in Orion. I look forward to updating you on our progress next quarter.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Good morning. Thank you all for joining us today. Sally Washlow, Orion's CEO; and Per Brodin, its CFO, will review the company's first quarter results and its fiscal '26 outlook, and then we will open the call to investor questions. Today's conference is being recorded. A replay will be posted in the Investors section of the company's website, orionlighting.com. As a reminder, prepared remarks and answers to questions include statements that are forward-looking under the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally include words such as anticipate, believe, expect, project or similar words. Also, any statements describing future objectives or goals, company plans and outlook are also forward-looking. These statements are subject to various risks that could cause actual results to differ materially from current expectations. Risks include, among other matters, those that Orion has described in its press release issued this morning and in its SEC filings. Except as described therein, Orion disclaims any obligation to update or revise forward-looking statements made as of today. Reconciliations of certain non-GAAP financial metrics to their nearest GAAP measures are also provided in today's press release. Now I will turn the call over to Orion's CEO, Sally Washlow.

Good morning, and thank you for taking the time to join today's call. When I became CEO in April, I was confident that we could promptly establish a trajectory of year-over-year growth in revenue, profitability and shareholder value. Today, less than halfway through my first full quarter as CEO, I can say that I'm not just confident of it, I'm certain of it. Here are the 3 reasons why I am certain of it. Orion Energy Systems is recognized widely for unsurpassed quality in LED lighting and electrical infrastructure for industrial and commercial facilities, unsurpassed quality. The proof of this is that some of the biggest names in the automotive industry rely on Orion and effectively only on Orion to light up its most critical facilities in North America. Orion Voltrek is recognized particularly throughout the Northeastern United States for unsurpassed quality in EV charging and electrical infrastructure. Unsurpassed quality. This, too, is evidenced by yesterday's announcement about our most recent deployment in the Boston Public Schools. Orion is also recognized widely as an ongoing partner of unsurpassed quality in our maintenance services. Unsurpassed quality, our maintenance services have been integral to our long-standing and new customer relationships. Recent headlines notwithstanding, all 3 markets for these business lines have tailwinds nationally and regionally. Orion has a timely opportunity to convert its quality leadership into market leadership in all 3 of them. We further believe that this translates into a parallel growth opportunity for reoccurring revenue and margin expansion. With a sharpened focus on growth, profitability and market penetration in each of these areas, we believe we can achieve that market leadership in this fiscal year. I'll have more to say about this with increasing frequency and with increasing granularity throughout this fiscal year. But for now, I believe strongly that we are on track to achieve 3 milestones for FY 2026. By the end of the third quarter, a positive resolution that enables publicly traded Orion to maximize its opportunity for growth and shareholder value. By the end of the third quarter, the enactment of a growth, profitability and cost containment initiative that enables Orion to become a recognized long-term market leader in its core businesses and by the end of the fourth quarter, $84 million in revenue at a positive adjusted EBITDA for the full fiscal year. Walking in the door in April, I was fully cognizant that for my fellow shareholders, the Orion Saga has been a long journey. Today, I'd say only that we see no better growth opportunity in this sector than Orion and that we are now embarking on a mission that is fully capable of fulfilling it beginning in this fiscal year, and I am certain of that, too. Now drilling down on Q1. Overall, the work we have been doing to enhance margins and reduce costs enabled us to deliver meaningful progress on the bottom line in Q1 '26 and puts us in a solid position for the full year. Our gross profit percentage rose to over 30% for the first time in about 6 years, and we achieved our third consecutive quarter of positive adjusted EBITDA. These improvements were achieved as the EV segment faced a tough year-over-year comparison. The decrease in EV revenue was largely offset by a solid rebound in maintenance revenue and slightly higher LED lighting revenue. While visibility in the EV segment remains challenged, we did have the public school bus charging station project start near the end of June. Our gross profit percentage increase resulted from meaningful reductions in the cost of our LED lighting fixtures through reengineering, plant efficiency efforts and enhanced sourcing as well as from both margin and volume increases in our maintenance service business. We were able to reduce total operating expenses by 10.6% to $6.9 million in Q1 '26 from $7.7 million in Q1 '25 through personnel and other cost control efforts, and we expect to benefit from other cost initiatives as we progress through the year. Turning to revenue. We have made great progress in building our pipeline of contracted LED lighting projects, some of which are highlighted in today's release, and we continue to make progress building our footprint within existing maintenance service customers. We are also taking steps to improve sales performance in our lighting distribution business, which serves a different base of customers. We have had initial success in this channel with the new line of value-based LED lighting fixtures, including Triton Pro, which we designed and engineered in response to feedback from channel partners and end customers. Triton Pro balances high-quality design components and energy efficiency at competitive price points that are resonating with customers. Now with a compelling product line and an investment in personnel to expand our market penetration in this channel, we expect our lighting distribution business to return to a path of growth. Another exciting potential avenue for growth for Orion is in electrical infrastructure, which falls in the sweet spot of our many decades of collective experience from large LED lighting projects, high-voltage EV charging station infrastructure and a wide range of electrical maintenance services. Each of our segments is involved in electrical infrastructure, and we have built a nationwide network of certified electricians with deep expertise and major project experience that is ideally suited to meet this need. Increasingly, our customers have been coming to us to bid on electrical infrastructure projects that may or may not involve other areas of specialty. Electrical infrastructure work is both an ideal complement to our existing business as well as a great opportunity to add further value to our customer relationships. Companies across the U.S. are making significant investments in electrical infrastructure for large-scale data centers, alternative energy generation, retail and office complexes, electrified vehicle fleet charging and other applications. Rapid growth in both the scope and complexity of electrical systems and the range of businesses that rely on them is starting to challenge the available pool of experienced personnel. Based on customer discussions over the past few months, we believe Orion is in a strong and unique position to serve this nationwide opportunity. We are still in the early stages of creating a roadmap to evaluate this market opportunity. We have invested some time and resources to compete for such projects, and we recently secured an electrical infrastructure project from an existing customer and have submitted initial bids on a few other projects. I don't have much more to say at this time on this matter, but did want to share with investors that we are exploring opportunities and we'll provide updates as warranted. Now I'd like to follow up on the reorganization plan we discussed on our last conference call. The decision had been made prior to me becoming CEO, but after further review, both internally and externally, we have decided to retain our existing operational and reporting structure rather than reorganized into 2 business units. We came to realize that we could achieve the same synergies under the current structure while keeping our team and resources focused on customer priorities and business development dialogues at the core of our growth goals. We are realigning some roles and are working to better integrate our EV solutions across our national footprint to create both sales and operational efficiency benefits that were objectives of the prior plan. The most important thing is for our teams to stay in close contact with our customers and prospects and to drive increased collaboration across our segments, and we feel we can best achieve those goals under our current structure. I believe Orion has built a strong and unique platform of high-quality and industry-leading solutions to meet our customers' goals and needs. We have made significant reduction in overhead, meaningful progress enhancing margin and have built a diversified pipeline of revenue to support our growth. In the first quarter, we made progress in our goal to return Orion to profitability, trimming our Q1 net loss to $1.2 million from $3.6 million in Q1 '25 and $6.6 million in Q1 '24. As stated earlier, we believe we are on track to achieve the revenue growth and adjusted EBITDA goals of our FY '26 outlook. I am both excited and confident in Orion's potential to deliver both growth and improving bottom line performance in FY '26 and moving forward. With that, let me turn it over to Orion's CFO, Per Brodin, to review our financial performance and outlook.

Thank you, Sally. Good morning, everyone. Today, we reported fiscal Q1 '26 revenue of $19.6 million compared to $19.9 million in Q1 '25, with 2 of Orion's 3 segments growing year-over-year. LED lighting segment revenue increased 1% to $12.9 million compared to $12.8 million in Q1 '25, reflecting increased project activity, offset by lower lighting distribution channel sales. Orion's expanded LED lighting project pipeline and efforts to drive growth in the distribution channel are expected to contribute to higher revenues in fiscal '26 versus fiscal '25. Lighting achieved a Q1 '26 gross margin of 31.8% versus 22.6% in Q1 '25, with impacts from pricing increases, cost reductions and sourcing initiatives amplified by a more favorable Q1 '26 project and revenue mix. Electrical Maintenance segment revenue increased 21% to $4 million in Q1 '26 from $3.3 million in Q1 '25, reflecting the benefit of new customer contracts and the expansion of some existing relationships. We achieved a Maintenance segment gross margin of 22.4% in Q1 '26 versus 3.8% in Q1 '25 as we were still working through some of the remaining Stay-Lite legacy customer contracts, which were no longer profitable in the prior year period. EV charging solutions revenue was $2.7 million in Q1 '26 compared to $3.8 million in Q1 '25, reflecting expected variability in the timing of larger projects. For example, Q1 '25 benefited from $1.3 million of Eversource-related projects that did not recur in Q1 '26, and we had nominal Q1 '26 revenue from a $3 million public school bus project that commenced in the last week of the quarter and should be completed in Q2. We expect a sequential revenue improvement in Q2 '26, primarily due to the school bus project and one other significant contract. EV achieved a strong gross profit margin of 33.5% versus 33.4% in Q1 '25. Our overall gross profit margin increased 850 basis points to 30.1% versus 21.6% in Q1 '25, reflecting pricing and cost improvements in all segments, particularly LED lighting and maintenance. We expect our overall gross margin to remain strong in FY 2026, though it will likely vary on a quarterly basis due to revenue mix and volume. Total operating expenses declined to $6.9 million in Q1 '26 from $7.7 million in Q1 '25, reflecting ongoing overhead and personnel expense reductions. We expect continued operating expense improvement from overhead reduction efforts completed or planned in fiscal '25 and fiscal '26 with some offset by potential increases in variable operating expenses, driven by a return to growth. Reflecting stronger gross margin and lower operating expenses, Orion's Q1 '26 net loss improved to $1.2 million or $0.04 per share from a net loss of $3.8 million or $0.12 per share in Q1 '25. Adjusted EBITDA improved to positive $0.2 million in Q1 '26 versus a negative $1.8 million in Q1 '25, reflecting cost control and financial discipline. Cash used in operating activities improved to $0.5 million in Q1 '26 from $3 million in the prior year period, primarily due to the improved bottom line performance. We also reduced our revolver credit borrowings by $1.75 million during Q1 '26 to $5.25 million at the close of the quarter compared to $7 million at year-end. Net working capital was $6.1 million at Q1 '26 versus $8.7 million at year- end, primarily reflecting the use of cash to pay down the revolver. Available financial liquidity was $9.8 million versus $13 million at year-end. Post quarter end, we issued $1 million of common stock and made a $500,000 cash payment to partially satisfy the Voltrek earn-out obligation. Turning to our fiscal '26 outlook. We have reiterated the fiscal '26 revenue growth expectation of 5% to approximately $84 million that we initiated in June. We have also reiterated that our revenue growth outlook positions Orion to approach or achieve positive adjusted EBITDA for the full fiscal year, depending on revenue mix. This growth outlook anticipates modest growth in LED lighting and electrical maintenance revenues and flat to slightly lower EV charging revenues due to current uncertainty around near-term funding availability for EV charging projects despite significant long-term infrastructure requirements and other opportunities. With respect to tariffs, the LED components that we source from Asia make up a small proportion of our cost of sales. We've been working to diversify our sourcing efforts in order to mitigate supply and tariff risks. Because we manufacture a large portion of our finished product in Wisconsin, we feel we are better positioned than competitors who source most or all of their products from overseas. Given this, we believe there's enough room to adjust our pricing to cover as much or all of the cost increases that we currently expect from tariffs. So at this point, we expect to manage tariffs to a net neutral impact for the business. And this concludes our prepared remarks. Operator, would you please commence the question-and-answer session.

Our first question comes from the line of Eric Stine from Craig-Hallum Capital Group.

So I mean, you clearly now have the cost structure set up to drive profitability, just a number of revenue growth initiatives. So I am interested in the electrical infrastructure piece. And I know you kind of said you're somewhat limited as to what you can say. But as we think about that, I mean, is that something where you would potentially bring that under your turnkey offering, leverage those relationships with electrical contractors out there, subcontract out. I guess I'm just trying to get at kind of what is entailed in building that out? Is there much of an investment needed on your side to do it? And any details you can share would be great.

So we are in the early stages of it. With growth, there'll be more investment, but we feel our current infrastructure can probably manage it and then we can scale appropriately. And this could also come from some of the EV work that we do as well. So think of it beyond traditional even turnkey lighting EV as well.

Got it. Okay. I guess I'll stay tuned on that one. And then secondly, I know your pipeline, you've been optimistic on that for some time, and we have seen a pickup in orders. I know that it takes time for that pipeline to flow through to actual awards. But do you expect that as you get into fiscal '27 and beyond, you start to see the impact of that growing pipeline and start to see the leverage from that revenue growth?

Yes. We do think that it will go beyond this year and into next year, absolutely. Some of the projects or things that we're working on now will continue into next year.

So they will benefit in the current year and then years beyond.

Right. And then the pipeline, though, I mean, right, the pipeline, what you've got now gets you into part of '27, but closing the pipeline to drive further growth to see further operating leverage.

Correct.

Correct.

How we should think about it.

Our next question comes from Bill Dezellem from Tieton Capital Management.

I'm probably going to break the rule of 2 question limit here. Let's start with the electrical infrastructure, if we could. You mentioned that you have an initial project. And to help us understand really conceptually what it is that you're talking about when you say electrical infrastructure, would you discuss kind of the actual activities that you all are doing with this contract win, please?

Sure. We'll discuss more of it in further releases. We're in the early innings of this project, but it is beyond our retrofit lighting and doing a lot more of the electrical infrastructure work and setting up areas to even on EV, do a lot more work surrounding that. So like I've said, this has just started, and we'll be back with more details. And I think you'll see an increase in announcements from us on all the work that we're doing.

And Sally, did we hear correctly that you have embarked on expanding the activities that you're doing in this electrical infrastructure by request from your customers?

Yes. It started from a request of a customer that we've worked with requesting us to fulfill some other services within the work that we were doing with them, and it's further expanded.

That's helpful. And then the Northeast bus activity, I believe that in the past, you all had -- I think it was the Boston school system. And I think that contract probably was completed. So would you kind of relate or tie together the contract of the past versus this new win that started the last week of June. And if they're somehow related, if they're unrelated, what tie or link there is between them, please?

Sure. It is further expansion of what they're doing across Boston in terms of electrification of their public school bus systems. So yesterday, we announced the work within this realm. So it's further expansion of the electrification of their fleet. And leading from the great work that we did, there's a continuation and award of more business.

And so the announcement yesterday of $6.5 million for the Boston Public Schools, that is a new win. That's not the current win plus the win of the past?

It is an ongoing win. So we've started some of the work, and it will continue throughout the year. But it had not been previously released.

So it did not include the revenues we recognized in the prior year for Boston for what I'll call the first 2 phases of that project.

And Per, to help us scale this, the first 2 phases, what was the revenue amount with those 2?

Phase 1 was approximately $1.3 million. And I believe Phase 2 was another $1 million, give or take. I'm not certain of that piece of it.

So this is a meaningful expansion. I mean we go from $1.3 million to $1 million and then Phase 3 now is $6.5 million. Is that the right way to think about this?

Yes.

Yes. And maybe another way to give it more context that those first 2 phases I mentioned were the same location. And so if you think it's $2-plus million for that location, then as they're expanding to other locations, that's when they -- the amounts can add up pretty quickly.

Well, then that begs the question of how many different locations do they have?

That, I don't know.

But more than 2?

Yes.

Okay. Great. And then one additional question for now, please. In the past, you all have talked about the fluorescent bulb ban that is to take place in certain states. Would you bring us up to speed the dynamics of that and whether any of those have been pushed out this year or pulled in? Where do we stand, please?

We probably need to get back to you with a complete answer on that. I haven't seen any walk back, but we can certainly follow up with you on that.

Do you foresee that being a driver to business for you all? And if so, when would you think that you would start to see the benefits from that?

I think it's one of the drivers of the business for us, but another big driver for the business is the ROI that these projects provide to the customers that we deliver them to.

And from a timing standpoint, a number of the states began the beginning of this calendar year. So it will have started to make an impact, but others, it's not until the beginning of calendar '26.

And enforcement, are you sensing that the states are enforcing the law at all? Or is this a case where businesses will just naturally deal with their lighting situation as they have problems, breakage, et cetera.

I think it's too early to tell on enforcement.

Congrats on the nice margins.

This concludes the question-and-answer session. I would now like to turn it back to Sally Washlow for closing remarks.

I want to thank everyone again for taking the time to join us today. We look forward to updating investors on our second quarter call in early November. In the interim, we hope to have the opportunity to meet in person or virtually with many of you. We will be conducting some individual investor meetings as well as participating at the H.C. Wainwright Conference on Tuesday and Wednesday, September 9 and 10 in New York City, and we'll present at the Singular Research Alpha Leaders Conference also in New York in September. We will announce details via press releases. Please also reach out to our Investor Relations team with any questions or to set up a meeting. Their contact information is at the bottom of today's press release. Thank you again for your interest in Orion. I look forward to updating you on our progress next quarter. Operator, I'll turn it back to you.

Thank you, everyone, for your participation in today's conference. This does conclude the program. You may now disconnect.

Good morning, everyone, and welcome to Orion Energy Systems Fiscal 2025 Fourth Quarter Conference Call. [Operator Instructions] Now I'll turn to Bill Jones, Investor Relations, to begin.

Thank you, and good morning to all. Today, Sally Washlow, Orion's CEO; and Per Brodin, CFO, will review the company's fiscal 2025 results and outlook. And following their prepared remarks, we'll open the call to investor questions. Today's conference is being recorded. A replay will be posted in the Investors section of the company's website, orionlighting.com. As a reminder, please -- as a reminder, prepared remarks and answers to questions include statements that are forward-looking under the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally include words such as anticipate, believe, expect, project or similar words. Also, any statements describing future objectives or goals, company plans and outlook are also forward-looking. These forward-looking statements are subject to various risks that could cause actual results to differ materially from current expectations. Risks include, among other matters, those that Orion has described in its press release issued this morning and its SEC filings. Except as described therein, Orion disclaims any obligation to update, revise forward-looking statements, which are made as of today. Reconciliations of certain non-GAAP financial metrics to their nearest GAAP measures are also provided in today's press release. Now I will turn the conference over to Orion's CEO, Sally Washlow, to begin. Sally?

Good morning, and thank you for your interest in Orion. As you may know, I took on the CEO position in mid-April, following nearly 3 years of service on Orion's Board of Directors. I've had the chance to speak with some of our investors since becoming CEO, but for most of you, this is the first time, and I look forward to getting to know you. It's an honor and exciting opportunity to lead Orion's impressive team. Over the past few years, Orion has made great strides in diversifying and enhancing a portfolio of complementary industry-leading products and services to better meet our customers' needs. We have also made significant progress reducing our cost structure and enhancing gross profit margins. and we have been very productive in developing new revenue opportunities. I feel we are moving in the right direction. However, it's clear that we need to do a better job, both developing and executing on our pipeline of product and service opportunities with greater urgency and that is my principal goal. While our lighting segment revenue remained challenged in FY '25, we achieved 37% growth in revenue at our Voltrek electric vehicle charging station solutions business. We also accomplished a substantial turnaround in the profitability of our electrical maintenance business. Based on the strength of that business, capabilities and performance, maintenance returned to sequential growth in FY '25 through the expansion of existing customer engagements. Looking into FY '26 and beyond, I am pleased to report that we have expanded our pipeline for LED lighting projects with a number of project wins that underscore our unique value proposition and enhance future revenue visibility. In our Q3 reporting, we highlighted new customer relationships and contracts that provide between $100 million and $200 million in total revenue potential over the next 5 years. And last month, we announced additional project wins that build on that potential. On the cost side, we have made meaningful reductions in the cost of our LED lighting fixtures through product reengineering, plant efficiency efforts and diversified sourcing, which are benefiting our LED lighting margins without impacting our ability to deliver the highest levels of design, quality and energy efficiency in our products. We also reduced our operating overheads by more than $4 million in FY '25, $2 million of which will be reflected as we progress through FY '26, and we intend to implement a further $1.5 million in annual overhead reductions during FY '26. Despite lower revenue, our operating discipline allowed Orion to achieve positive adjusted EBITDA in both Q3 and Q4 and positive operating cash flow for full fiscal 2025 year. My role is to build on this progress by bringing enhanced leadership, focus and urgency to our team and its efforts to achieve our growth and profitability goals. I strongly believe the Orion team possesses the skills, has industry-leading products, technical expertise, resources, customer relationships and service commitment to do just that. To better capitalize on the strengths of our 3 lines of business and the substantial base of customer relationships Orion has built over the past 20 years, we have reorganized our company into 2 commercial business units effective with the April 1 start of our fiscal 2026 year. The 2 units are Solutions, which includes products and services that we develop, manage and deliver to specific end customers' and Partners, which is focused on product sales via distribution agents, electrical contractors and energy service companies or ESCO channel. To provide a bit more insight, our Solutions business unit is focused on developing and executing across our full range of LED lighting, EV charging and maintenance service solutions. Solutions taps our full array of capabilities to deliver the greatest potential value to our customers and typically involves large projects in terms of revenue. The Solutions business unit also provides the potential to cross-sell and build new project and reoccurring revenue opportunities with our long-term customers. Our Partners business unit is focused on the sale of LED lighting and EV charging products through distribution channels such as ESCOs, electrical product distributors and lighting contractors. To strengthen our position in the Partners channel, Orion has developed new product lines such as Triton Pro, which balance performance, energy efficiency and design at competitive price points. These new products have been well received, and we're building on their success with additional products design based on partner feedback to resonate with our customers. We are also making focused investments to drive growth in the Partners business unit, including the addition of an industry veteran who will focus solely on this channel and our partners. Overall, our business reorganization is intended to deliver a more cohesive combination of capabilities across LED lighting, EV charging and electrical maintenance to optimize our success. So we have made some progress in developing business synergies over the past several months, it has become clear that we need to better leverage our engineering, design and national project management capabilities within the combined Solutions business unit. There is work to be done to further integrate the Solutions segment, including implementing systems and training to support our team members to represent and execute on our full array of offerings. Structure aside, the imperative for the team is to stay close -- in close contact with our customers and prospects and to remain focused in urgency to progress opportunities to the finish line or reassess and redeploy resources on more promising projects to fully maximize our business performance. In summary, Orion is clearly differentiated by the unique platform of high-quality, industry-leading products and innovative services we have been providing over more than 2 decades. These strengths, combined with our large base of long-term customers, our progress on costs margins and growing our project pipeline position Orion to deliver improving financial performance in FY '26 and longer term. I'm firmly committed and incentivized to make this happen for all of our stakeholders. With that overview, I will turn the call over to our CFO, Per Brodin, to review our financial performance and fiscal 2026 outlook.

Thank you, Sally. In Q4 '25, we reported revenue of $20.9 million, up sequentially from $19.6 million in Q3 '25, but below the $26.4 million achieved in Q4 '24. In addition, Orion has made excellent progress building its project backlog. On an annual basis, fiscal '25 revenues were $79.7 million versus $90.6 million in fiscal '24, reflecting the following segment trends. Our EV charging business delivered a strong performance both in Q4 '25 and for the full year in 2025, with revenues up 18% and 37%, respectively, as Voltrek expanded its geographic reach and executed on its order backlog. EV charging also achieved an improved gross margin of 28.3% in FY '25 versus 27.2% in FY '24, mainly due to an improvement in revenue mix as well as greater fixed cost absorption on higher revenue. In LED lighting, Q4 '24 and fiscal '24 revenues trailed the prior year periods by 33% and 22%, respectively, due to reduced major project activity as well as reduced product demand in our energy service company and electrical distribution channels. Lighting achieved a gross margin of 26.6% in fiscal '25 versus 27.3% in fiscal '24, offsetting much of the impact of lower revenues with targeted price increases, cost reductions and sourcing initiatives. We expect margins to improve on modestly higher LED revenues in fiscal '26 as Orion executes on its substantial backlog. As anticipated, our electrical maintenance services segment revenue decreased year-over-year to $4.1 million in Q4 '25 versus $5.2 million a year ago. However, the business achieved a substantial turnaround in gross margin following our strategic repricing actions to improve profitability and our exit from several large but unprofitable contracts. Fiscal '25 maintenance revenue was $15.2 million versus $17.1 million in fiscal '24, as new opportunities within existing customers provided sequential revenue improvements in each of the last 3 quarters of fiscal '25, offsetting more than half of the revenue loss due to the ending of legacy contracts. Maintenance services gross profit margin rebounded to 18.2% in fiscal '25 from 4.4% in fiscal '24, and we expect continued improvements in both revenue and profitability in fiscal '26. Overall, our blended gross profit margin increased 170 basis points to 27.5% in Q4 '25 versus 25.8% in fiscal '24. The increase was due to profitability improvements in maintenance and a higher margin revenue mix in EV charging as well as lower overhead costs. As Sally mentioned, we've reduced manufacturing costs on our base lighting products through reengineering and efficiency efforts in the plant. We expect our overall gross margin to remain strong in fiscal '26, though it will vary to some extent on a quarterly basis due to product mix and volume. Moving down the income statement. Our total operating expenses were $8.4 million in Q4 '25 versus $5 million in Q4 '24, primarily due to a $3.5 million year-over-year difference in the quarter for Voltrek earn-out expense, which was $0.5 million in Q4 '25 compared to a $3 million net credit adjustment in Q4 '24, reflecting the reversal of prior earn-out expense accruals. As we mentioned, Orion reduced its annual operating overhead run rate by more than $4 million during fiscal '25. However, roughly of this improvement will be reflected as we progress through fiscal '26. This progress was offset by a $1.6 million year-over-year increase in Voltrek earn- out expense reflected in fiscal '25 operating expenses, which improved to $30.8 million versus $31.7 million in fiscal '24. Orion's gross margin improvement was not sufficient to offset lower revenue and the $3.5 million year-over-year variance in earn-out expense, resulting in a Q4 '25 net loss of $2.9 million or $0.09 per share compared to net income of $1.6 million or $0.05 per share in Q4 '24. Likewise, our fiscal '25 net loss increased slightly to $11.8 million or $0.36 per share compared to a net loss of $11.7 million or $0.36 per share in fiscal '24. Cash generated from operations improved to a positive $600,000 in fiscal '25 from negative $10.1 million in fiscal '24, primarily due to inventory and other working capital management. We were also able to reduce revolver borrowings to $7 million at the close of fiscal '25 from $10 million a year ago. Net working capital was $8.7 million at year-end compared to $10.5 million last quarter and $16.8 million last year. Lower year-end current assets reflects our active working capital management, which includes a roughly $6 million year-over-year decrease in inventory investments. Year-end financial liquidity totaled $13 million as we disclosed -- and as we disclosed today, in order to pay Orion's Voltrek earn- out obligations, we've structured and executed a binding term sheet designed to resolve the obligation while mitigating the near-term liquidity impact. Under the term sheet, Orion intends to use $1 million -- issue $1 million of common stock in July, making $875,000 cash payment on August 1 and repay the remaining balance with a 2-year 7% subordinated note, which matures in July 2027. Based on our financial position, improved cost structure, margin profile and this revised earn-out structure, we believe Orion has sufficient capital to satisfy all of its obligations and to support its business and growth goals through fiscal 2026. Now turning to our outlook. We've initiated a fiscal '26 revenue outlook expectation of 5% to approximately $84 million, which will be reported based on our new Solutions and Partners business unit structure. For context to our prior reporting segments, our revenue outlook anticipates modest growth in LED lighting and electrical maintenance revenues. Additionally, despite the substantial long- term potential we see for EV charging station infrastructure, our fiscal '26 outlook currently anticipates flat to slightly lower EV charging revenues due to current uncertainty around the near-term scope, pace and funding for EV charging projects. Though we still have a few days left in our fiscal '26 first quarter, we currently expect total revenues in the vicinity of that achieved in Q1 '25, although it is likely to be slightly less. Based on expected operating costs and gross margin improvements, we believe our revenue growth outlook positions Orion to approach or achieve positive adjusted EBITDA for the full fiscal year. In developing our outlook, we try to incorporate current economic and business factors and their potential impacts on the timing and magnitude of existing and anticipated projects, including those outlined in today's press release. Of course, we plan to revisit our outlook commentary and refine it as required as we progress through fiscal 2026. And with that, I'll ask the operator to open the call to the Q&A session.

[Operator Instructions] Our first question is going to come from the line of Eric Stine with Craig-Hallum Capital Group.

So maybe I'll just start with the order trends. You called those out that you have seen a rebound or a strengthening in Q4, and that's continued into Q1. Curious, I mean, has that been pretty constant throughout the quarter? I know you're almost done with the quarter. Is this something you expect to see in Q2 and going forward? And maybe, what do you attribute that to, if there's something specific? Is it just more comfort at the federal level that budgets are not going to be cut or buildings closed and all of the noise that was coming out a couple of months ago?

I can start with that. So nice to connect today. We saw the beginning of the year got off to a really good start with orders. And April was probably our strongest, and then May and June continue to progress. So we expect that to be -- to continue. Fortunately, the noise has -- less noise has helped and we continue to execute upon the projects that we have in the backlog and continue to build that backlog as well.

I think maybe for a little more color. Some of that is actualization of orders related to some of the projects that we've talked about in the past that may have not yet manifested themselves in orders. So those are starting to come through and reflect themselves in the pipeline themselves.

Got it. Okay. That is helpful. And I guess, for my second one, maybe just on EV charging. Can certainly appreciate the uncertainty that you are calling out and also the long-term. But just what are the assumptions that go into you thinking that, that business in fiscal '26 is flat to down? I mean are you factoring in any improvement in the macro? Just any thoughts around that would be helpful.

We're taking a conservative approach with that segment for this upcoming fiscal year. But we have a strong pipeline of projects. And we continue to look at the overall environment through EV sales and the need for the infrastructure to continue to be built. So we're leveraging the work that we've done in the areas that we have, along with the fleets that we work with and their continued progress of building electrified fleets and then us being the provider of choice to help them with the infrastructure to support those fleets.

Got it. And you've talked about in the past a pretty big pipeline there. I mean is it fair that part of this is just the pipeline is still there, that hasn't changed, but the closing of that pipeline is a main factor.

Yes, it is. We have a good pipeline. I think some of the noise at the federal level has hurt, but we continue to progress on several projects and we'll continue to stay focused and quite frankly, capture market share where we can on those projects.

Our next question is going to come from the line of Sameer Joshi with H.C. Wainwright.

Just following up on the previous -- Eric's question on EV visibility. Your 4Q revenue, fiscal 4Q revenue was actually sequentially the highest of the year of the 4 quarters. And it seems that although there is noise at the federal level and in general against the EV industry in general, it seems that on the ground, the sales have not been impacted so much. So are you just being overcautious in the outlook for EV?

I think, Sameer, the way we're thinking about it is we do have a strong pipeline, as Sally mentioned in her comments. I think we have said previously that to date, we have not been a subject to direct federal funding issues on the EV side. So we don't see that necessarily as such a large impact on our EV business. However, there is maybe some additional impact down the road, depending on how it affects the overall environment in EV. We did have one significant project that was impacted by some of the federal actions and that one project was canceled mid project. But we feel that through the funding that's available through both utilities and states that we'll have enough to achieve our -- what we think is conservative objective, but there certainly is -- remains uncertainty in that sector, just depending on, say, on timing of when the infrastructure improvements will be made.

Understood. Just a couple of quick ones. Earnout for 2026, you mentioned $1 million and the $875,000. Is there anything else? Do we expect it to be paid during the year based on performance or this is it?

The end of fiscal 2025 was the end of the earnout opportunity related to that purchase. So the obligation that we have remaining will only be, I'll say, subject to the payment and stock in July, the $875,000 mentioned, and then the remaining balance, which is subject to agreement on the final amount as we move forward, but there will be no more or not opportunity per se. And that remaining balance is subject to the subordinated note that we mentioned in the prepared remarks.

Understood. Yes, the one that is decided -- will be decided later. Okay, got it. And then in terms of cadence of revenues throughout the quarter, you mentioned first quarter is likely to be flat or down. Rest of the quarter, should we expect year-over-year increase in that 5%-ish range? Or do you see any other variability from where you sit right now?

So right now, we see the quarters playing out relatively consistently. Obviously, they'll need to be above the amount that I alluded to that we expect to achieve in Q1, but not significantly. We're not expecting this year to be back-end loaded as we've seen in the last couple of years. So overall, I expect it to be a little more even, but obviously, the subsequent quarters to Q1 will be higher in order to achieve our outlook.

Understood. And then last one on gross margins. We see the outlook. But in terms of the business units, Partners and Solutions, should we expect different levels of gross margins there? And also maybe I can squeeze in, will you be also providing EV and LED gross margin separately in this going forward?

I'll address the last question first. I'll say we have to refine what our external reporting will be. In general, we'll report -- expect to report on the Partners and Solutions basis. Certainly expect to provide color on a revenue basis for some of the other things that we've done historically, and then we'll have to determine what we -- how granular we get from a gross margin standpoint. Going back to the beginning of your question, we expect those margins to be relatively consistent. I think overall, as we said, we expect to be at a level higher than what we achieved this quarter based on the savings and other product initiatives that we've initiated.

Our next question is going to come from the line of Gowshi Sri with Singular Research.

Can you hear me?

Yes.

Yes.

So just following up on that gross margin question. Just given that the EV segment is forecasted to be flat and the Q -- the margin improvement is coming from sourcing improvements and some temporary pricing actions, how can you maintain that margin improvement? Is that through -- mainly through sourcing improvements? Or is that some of the -- is that some of the pricing actions also being priced in?

I'd say a lot of the improvement we expect to come through the lighting and the services side, and we expect to maintain reasonable. We expect EV margins to remain reasonably consistent. So some of that is just pricing of projects and supply chain initiatives.

Okay. Okay. And on the earn-out side, what is the thought process behind settling at stock prices at these depressed prices? And is there any kind of provision for preventing further shareholder value issue?

The thought process was to reach an agreement that was satisfactory to both sides of this agreement and to, as we mentioned, mitigate some of the liquidity impact in the near term. So that was the agreement we reached in terms of a combination of shares, cash and subordinated notes.

Got you. And just my last question. In terms of -- with the management holding back performing bonuses, could you specify if the NASDAQ compliance is also expertly included in that compensation package?

I'm sorry, we didn't hear that entire question. Could you repeat?

So I suppose, it's directed at Sally or you. The compensation bonus is kind of tied to the performance milestone. Is the NASDAQ compliance also kind of explicitly included in that compensation?

It's, I mean, it's tied to the NASDAQ compliance and per se, the shares will be appropriately allocated to whatever we might have to do in terms of keeping that compliance. That answers your question.

[Operator Instructions] Our next question is going to come from the line of Bill Dezellem with Tieton Capital Management.

I'd actually like to pick up on a couple of the questions that have already been asked. But first of all, the federal government rule changes, would you please walk us through the ones that actually impact you all? There's just been so much noise that I've lost track of what is a headwind, what is a tailwind, what is simply noise? Would you walk us through that, please?

Are you referring to specifically the EV segment?

I'm actually referring to both because I think there's been a lot of discussion just in the government in general. So I'm throwing a light, asking for a little help here.

Okay. Sure, sure. Yes, there has been no shortage. So I'll start with the EV side, and Per can certainly add to this. When -- as Per said, we were minimally impacted by one direct government project that we had on EV. And it was canceled. We fully recovered much of our costs within that as well based upon the contract. I guess the other side of this good news, bad news, we were not -- we didn't have a big pipeline of business tied directly to NEVI. So we were never really getting the tailwinds of all of that. So it hasn't -- the funding, the NEVI funding and the lack thereof has not directly impacted our EV pipeline per se. On the lighting side of the business, we have several projects in our pipeline that remain to be strong. They're getting executed within various sectors of the federal government. And if anything, they're growing and maybe it's because they're in areas that the current -- the current administration is focused on as well. Per, I'm not sure if you want to add more there.

Yes. I think just touching on both of those points. On the NEVI side, I think, as we have discussed in previous calls, we never really got a lot of tailwind from that effort, and that is one of the items that we believe has been scuttled as part of the new administration. So while we thought that may ultimately provide some tailwind in the EV sector for us, it hadn't yet and now we obviously don't expect it to. The one specific project that was canceled just for clarity, we -- that project was in process. So we achieved some benefit from that, but then it was since canceled by the government, and we don't expect that to move forward at any other time. And that again was an EV project. And then with respect to the other projects we have with the federal government, we have significant revenues expected in fiscal '26 and those are underway. You will see in Q1 some significant benefit from those projects, and we expect that to continue throughout the rest of '26. And then I guess one follow-on just to clarify, a lot of the, say, impetus that helps drive our business is driven by, one. It is driven by funding, it is driven by funding from utilities and state monies so that is not nearly as subject to federal funding as it is, the savings trying to be achieved by electric utilities as well as the state's efforts to improve their infrastructure.

Great. And then relative to the new structure that you have talked about, Partners versus Solutions. Is that now possible because the Voltrek earnout is complete? Or is that peer coincidence, the timing of those two?

I mean it's certainly possible because the earnout is complete, but there's a lot of things that we can do within the 2 businesses and combining solutions allows us to further leverage our national footprint and capabilities to expand a lot of the projects, that work that we do in other geographic areas. So the timing is right for it, and we're moving forward with that initiative.

So you wouldn't -- you would or would not say that it's -- that could not have happened prior to the earnout being complete and therefore, now it's possible?

I think it could have happened. It didn't happen. But we are moving forward with it.

Okay. That's helpful, Sally. And then relative to the industry veteran that you've hired for the channel sales. Would you expound upon that, please?

Sure. He is a returning Orion team member and is excited about the future potential that we have, and we were able to get him to rejoin the company and lead a channel that, quite frankly, we have struggled with over the past couple of years. So we're excited to have him back and he's a very productive leader and driver within that channel.

All right. With that additional color, I have to ask, what prompted him to leave and where did he go?

He went to a competitor and maybe wasn't happy with some of the direction. But he's looking forward to the future here and knows that we have a great team, which we do, and we have great products, and he's happy to represent them again and help us rebuild that channel.

Great. And then relative to the commentary about your wins in fiscal Q4 and those continuing here in the first quarter, would you talk in more detail about those than you have up to this point?

I mean some of them we did announce, but in terms of some of the wins, I think the great news that Orion brings is our flexible supply chain, how we're able to work with customers and meet their needs. So we've had -- we've just touched upon government agencies that are specifically looking to us for our BAA products. So that has been some wins and those projects continue. We've recently won a national bank with nice revenue potential through an ESCO partner. So we continue to build our product pipeline and there's more to come in that realm as well.

And then relative to the tariffs and just the shifting global cost structure as a result, have you seen any clear direct impact yet from your domestic -- the benefits of your domestic manufacturing? Or is it still too early because it's really unknown what the tariffs are going to be country by country?

Yes, Bill, I think it's safe to say there's more unknown than known at this point. It's something we monitor on an ongoing basis. We believe, based on what we know today, we'll be able to manage through this. Our intent is to manage through it and, I'll just call it, a neutral basis. But there's more to come based on the news that comes every day. But as of yet, no significant impact.

Understood. And then lastly, given that we are only just a few days away from the end of this quarter, any additional insight that you can share beyond what you already have on this call with an earlier question would be appreciated.

No, I think that's about as much color as we care to bring about the quarter, certainly incremental to what we typically do, but we felt that based on where we are relative to the quarter ending next week, that we'd provide that color and we look forward to reporting it out the beginning of August.

Our next question comes from the line of Steve Rudd with [ Blackwell. ]

Sally, you're -- I mean, at this point, not new, but still fairly new to the job. What are the frustrations you're seeing with the corporate structure there have to be? And then what will you do or what is your path to expedite the remedying of it?

So you're right. I am fairly new, and we've been working hard this quarter on that structure. I think that the synergies and the cross- selling that we can do within our Solutions business, I think there's a lot more that we can capitalize on there just in terms of how we scale the business and how those teams can work together. So I think that's a great potential for the future within Solutions is our maintenance business, our EV business as well as a lot of the project work that we do. And I think that there's a lot to be had within that group. So maybe we've been a little too siloed in that, and we're certainly breaking that down. There's a lot of maintenance work to be done across the U.S., not only in lighting but in EV, and we have a footprint that can help manage that. And then on the Partner side, some of it is some channel rebuilding and as we spoke to earlier, bringing back an industry veteran to lead that will help us lean into that channel as well and also bring new products to that channel that are required to sell and compete in that channel. So we're going to move quicker and with greater urgency.

Sally, it sounds to me like you've got large opportunities in your cost structure. I mean do I agree -- do you -- I mean to specifically personnel, do you see that as well? I mean that seems to be where -- and of course, that always drops quickest to the bottom line. But is -- am I reading that correctly?

We're always looking into that to maximize the team's capability, but I want to stabilize the team and get us on the path to growth as well and have some team members learn from each other in terms of their specific lines of business and how do we capitalize on how we execute some of these projects in the market as well within a greater national footprint.

This concludes the question-and-answer session, and I'll turn the call back to Sally Washlow for concluding remarks.

I want to thank everyone for taking the time to join us today. We look forward to updating investors on our first quarter call in early August. And in the meantime, we hope to meet with you in person or virtually at upcoming conferences, which we will announce as confirmed. We are currently planning to participate in a few investment conferences beginning in late August and September, which we will announce via press release once confirmed. You may also reach out to our Investor Relations team with any questions. Their contact information is at the bottom of our press release. Thanks again for your time today and your interest in Orion. Operator, I'll turn it back to you.

Thank you. That concludes today's conference call. You may now disconnect. Everyone, have a great day.