Calix, Inc. (CALX) Earnings Call Transcript

How's everyone doing this morning? Yes. So before we start, let's have a big round of applause for all the customers and team members who got on stage in front of all of you last night and kick the show off with the ban. Let's give a big round of applause for the ban. All right. I just got told something that you guys like the pavilion outside more than you like what we did last year in the other place. So my question is, yes, who wants it there next year outside? Yes, a big -- there you go. Scott looks like that's done. All right. So welcome. Welcome to Connexions. I was just reflecting this is my 10th year at Calix. This is my tenth year at Connexions. And if I think about what we've accomplished together over the last 10 years, it's incredible. And we've transitioned this conference slowly but surely into what's all about you. So it's about how do we innovate with you, and you're going to see thematically throughout the morning that we talk a lot about together. And then how do we celebrate your success? How do we focus on your success every single day and ensure that we harvest that knowledge to this community of people, which John is going to talk about later today, how do we make this community stronger and stronger and help each other to thrive in what is a crazy time in this world. And if I reflect back on 2025, October last year, when we stood on stage with you, that's when we unveiled multiple years of work. The work that we started back in November of 2023, where our team started to pivot into artificial intelligence, hundreds of millions of dollars invested into our platform so that you could be successful with what will be the biggest trend in human history. If you look back in time, and we're going to talk a lot about that, the pace of change that all of us are living in has never been seen before. I was joking with someone as I walked to the stage this morning as we're walking in the hallway, and we were both joking about the fact that I grew up with a black and white television playing palm. Who here grew up with a black and white television? Yes, exactly. To talk now about autonomous cars. If you're in Las Vegas and you haven't taken the time to get into a Waymo or get into Amazon Zoox and try that out, that's the future. Everything is changing at what is an astronomical pace that human kind is really going to struggle with. But the good thing is, we saw that in November of '23, Shane Eleniak, and his team, he saw that AI was finally ready where we can make it trusted and secured. We're going to talk about that today. And we made those significant investments so that you don't have to worry about the things that everybody else is freaking out about, which is how do I use artificial intelligence in a safe and secure way to drive predictable outcomes. We made that investment. And in March, at the end of March, every single one of our customers is now AI-enabled. You have exactly 0 to do. You just need to use it because it's embedded in all elements of our platform. And so I do know that it was difficult because let's be clear. Think back on your career. I've been working for, I don't know, 40 years, probably since I was 10 years old when I had a paper route. And if I think about all the things that I did through my life, you know what never happened to me. Nothing worthwhile ever happened easily. Everything that I did, everything that my teammates did, everything that our company has done with you has required sacrifice hard work weekends, pain because the only way something is worthwhile is if there's some pain to get to it. If that wasn't the case, anyone could do it. And so this was hard but it was worthwhile. And today, we're going to walk you through all the ways that is worthwhile for your teams. How we are going to litter, AI into everything that you do every day. So instead of thinking about how I have to go build this stuff and worry about like what anthropic did and things break out and worried about losing my customer data, you can focus on what's important, which is selling, marketing, building more and winning, not monkeying around with technology. So it was hard. We know we slowed down some implementations. We had some problems because when you're holding a petabyte of data every single day, it's a juggling act, and there's going to be a bit of that. So I want to start by saying thank you to all of our customers for going on that journey with us, we acknowledge how hard that was. We deeply appreciate it. And my promise to you is now it pays and it pays big because that investment in time and effort and the communications that we've had together, it's going to pay. So a big round of applause and thank you for everything that you've done and we're working through that with us. And let's be really clear. There is absolutely positively no virgin of the future where AI is optional, none. Everything is changing, and you either change or you get run over. You will find my dialogue on LinkedIn this morning with somebody who doesn't acknowledge that fact, quite humorous, because the individual was unwilling to accept the fact that we as human kind, need to change. We didn't change how we think we need to change how we learn, and we have to accept this isn't going to stop. Pushing against AI is like the stable carrier, the guy who bread horses saying, "I don't think cars are coming." The difference between forward motor putting out cars and eliminating the horse-drawn carriage and what's happening today is the pace. What happened in decades is happening in weeks. And this is something that we're going to talk about a lot today, how do we embrace that change and make the most of it because we will put you to the front, Game On. That's why we've invested all this money to get to this point. And that investment is managed by what you tell us. I would still remember when Karl, our Chairman, recruited me into Calix. And I had multiple choices. I was working for Salesforce. I had another huge company pre-IPO trying to get me. And then I met Karl. And what he described was you. His biggest selling point about why to join Calix is because of what you do every day. You change your communities. You help the police fire ambulance do greater things. You invest in places that no one else invested to ensure that everybody is connected. So it doesn't matter what your economic strata that you can be successful, raise yourself out and do great things. And so when he talked about that, what we really built on in my last 10 years is how to make sure programmatically that everything that we do is a partnership together. Shane and his organization spent a huge amount of time from a product discussion point of view, debating with you, talking about things, collaborating. And I -- this is my favorite statistic of the entire show other than when you -- all your successes. And it's all the things that we did together over 12,000 engagements, over 352 collaborations, we're still running massive customer engagement processes that allow us to communicate together. And this becomes really important as we go through the stage of AI because unless we communicate and do it together, we won't succeed. Again, where you need to come together as a community is when change is at a rapid pace. It's easy when things are going well. It's -- but when changes are all around you, we must talk a lot. And so if there's things on your mind, I encourage you to call me. People send me a text, people call me, send me an e-mail, glad to your respond, might be a little slow in e-mail, sorry, plans get in the way of that, but I will respond. And if there's things that we can do better, make sure you tell our team, we have a team here who's only job is to make sure we understand what you need, what we're doing well, what we're not doing well. That's what this conference is about, innovation and your success. And so I want to also say thank you, thank you because if you look at all those engagements, that's a lot of your time. And if we're not listening, then that's not good. And so what I will show you as we go through this conference is just how much we're going to listen this year because we finally have a massive amount of capacity to do what you need to do successful. So huge thank you, a big round of applause for yourselves, and thank you for the partnership that you've allowed us to have. One of the speakers that's going to come up at the end of the day -- of the morning is actually Bergen, our new Chief Marketing Officer. And what he's going to talk to you about is the massive transition that we're going to have with regards to partners. I talked about this last year at connections that the future of artificial intelligence is not just language models and those things, but it's also these core technologies that shift us from -- away from APIs and allow us to engage with partners in a new way. Those core technologies are A to A, which is agent to agent and MCP, which is model context protocol, which is the ability to leave data where it exists and just harvest what is the context that an agent needs to do great work and share the context and then into knowledge. And we've put those in place. In fact, we've built out an MCP server. So if one of your partners is not actually moving testing, you can drop an MCP server in front of it, and we can harvest that context. We've made big investments. And as you can see, the ones in orange are the ones who are actually moving fast to also ensure that MCP works between our partnerships. The second part of it is these partners are the future. Working together is very important. Not only do they -- are they making these investments to get to A to A and MCP, but at the same time, they're here at the conference, during the partner showcase please take the time to go and talk to them because every single day, they're focused on making you more successful in driving your business. So let's give them a big round of applause and thanks. And as I said, there's no future that doesn't include AI. And I put this quote up last year AI won't replace humans, but humans who use AI will replace those who don't. I would trade humans for companies. AI won't replace companies, but companies who use AI will replace those who don't. And to all the first movers, a couple of hundred of you out there, those of you who have actually jumped in with us collaborating deeply on artificial intelligence. You've actually adopted what we're doing end to end from a platform point of view. Thank you. Because what you're doing is you're helping us go faster so that everybody else can benefit by collaborating very closely with us around all the workflows and the agents that we're leasing at a very, very fast pace. So let's give these first movers who actually have signed up with us and are embedding their business with AI, a huge round of applause. Well done. Thanks to the community. And look, I'm a CEO. The pressure just keeps going up. And this pace of change thing and actually may cause a lot of attention for all of us. Our teams, our customers, our employees, this is a huge pressure cooker. And I was reflecting back is that if you go back 5 years ago, just before COVID, the big conversation we were all having was, well, I'm going to have a multi-fiber market. That was probably the biggest thing that we were worried about. The multifiber market. Then we started to see the big guys put together, they call it convergence, which is just a price bundle. Then we see the advent of wireless satellites and governments not stopping them from controlling the skies. So those are spreading out. And then you got to Amazon. And as I have asserted over and over again, Amazon is the biggest entity. Why? Because they're great. We actually looked at their MPS. I think my second job is breaking down Amazon boxes every night. Who doesn't buy Amazon? I do. I'm a very, very happy Amazon customer. The MPS, we actually searched out their MPS, and it ranges somewhere between 47 and 73. I don't have an alternative. I love it. And so when Amazon Eero shows up and they're in the home, and if you see what they're continuing to expand on devices, what they do is they knock you out and they turn you into a dumb pipe. When you are a fiber behind an Eero, you're irrelevant because the cheapest guy who comes forward is just simply going to plug it in. To move from an Eero instance on one fiber provider to move to another Eero instance on a fiber provider involves this. unplug WAN, plug WAN in because all the loyalty is with Amazon. This, to me, is the high watermark and what you need to compete with every single day. Then we've got cost. All of us are feeling it. We did it -- we actually did some quick math. Interest rates in the last few years are up almost 5,000% -- that has an impact on all of our businesses. It has an impact on our homes. It has an impact on our kids. We're all filling that crunch. Memory costs, thanks to these AI nut bars, are up 5% -- 5x. We're all getting screwed by the AI companies when it comes to memory. It's through the roof. What cost $1 cost $30. It's insane. That will bust. It's coming. I'll explain that later. But this is -- we all feel this pressure. And then on top of it is the pace of change. The pace of change is so rapid. It's something we've never seen in history before. And we're all worried about what's going to happen to my kids, what are the jobs going to be like, all those kind of things, all at the same time trying to run a company while our Board is saying, get going faster because if we don't do it, someone else will. And the key thing I'm going to -- I want you to think about as we go through today, as we go through the next 2 days is one word. We're going to do this. One of the things that I'm proudest of in my 10 years at Calix is that, yes, we've made mistakes. But the enemy of good or the enemy of good is great. You have to do these things, you're going to make mistakes because, frankly, if you think back through your career, and I say this all the time, I think back through my career, my biggest learnings are when I screwed up, not when I did it the right way because I already learned that. It's actually when something went wrong. So we're going to work through this together. And if we try things and they don't work, then what do we do? We move on to the next thing, we try things and then we make them work. That's the power of a platform that we can actually do these things fast and control them and be safe and trusted and do it together. And I cannot amplify enough that we're in this -- and look, that shift is big. And in your mind, the thing you really need to think about is capacity. The next 2 days are all about how do we give you capacity to do more things. And I made the statement, how do we free you up instead of playing with technology and building things and those kind of things, taking that head count and bring it into sales because you can grow your way out of any problem. You can't cut your way out of a problem. You can grow your way out of it. And this, I have put this up every year is a simple example of what you can do to grow your business tomorrow because we're not getting it done. And so we did a little bit of research with AI, fascinating. Then we fact checked it because it lies. And what we did was we went through, it does. It's called the drift, but it's a lie. So we went through it, and what we found out is that 8% of homes in the United States smaller in Canada due to ICE, but 8% of homes in the United States have a pool. Then John, in the conversation said, "Yes, but we're in rural America. There's a lot of ponds, and we found out that ponds are actually classified as recreational ponds." So 4% of homes in the United States, single-family units actually have a recreational pond. Who knew? I didn't. 12% target for outdoor WiFi. What is our collective attach rate on outdoor WiFi for every GigaCenter and GigaSpire that's been installed across the base, 0.5%. You might as well burn a $10 bill every single month. Because if we want to create the capacity to win more, build more, be more successful, if you have members who want to show profit or your investors who want profit. $10 a month is being burned if your attach rate isn't higher than that. And we can argue what the right target number is, but you're going to hear someone come up on stage where he went from that to 2% to 4% and is climbing his way up, whether your number is 6%, 8%, it's a heck of a lot better than that, and that will put hundreds of millions of dollars in the pockets collectively of this group. More importantly, it crushes churn. Who is going to change? I have outdoor Wi-Fi, 4 outdoor WiFi systems on my house. And if someone came along and said, "You could save $10 a month on your fiber if you swap, but you have to rip everything out and put up all the antennas and make it all work again outside." What would my answer be? Have you met my family because they're going to guarantee and say I'm going to screw it up somehow. And so no, that's not happening. It's not happening. It is the ultimate churn vendor. And the key thing that I hear from everybody is, I need capacity. And so through the day, what you're going to see is how we are going to add capacity so that same team member can do more. run more campaigns, do better segmentation, understand the subscribers. You're going to see videos today that are going to blow your mind because we did them for a price that you can afford. It is a massive shift and a great opportunity for us to rethink where is your capacity today and how do you drive good outcomes? SmartTown. 16% of people still have SmartTown turn on. I hear you. There's all kinds of things that we use as excuses around why it's not turned up. It doesn't quite turn on fast enough these kind of things. We have capacity to work through those workflows to ensure we get it perfect, but it should be 80%. It frankly should be 100%. There is no excuse for us not partnering with police fire and ambulance, local police so that they can ancillary benefit from Wi-Fi on any of their devices if they're in an area. It doesn't cost you a penny. We made it free. You can flip the switch, like Scott Hendricks did it, Tom Bigbe and overnight, he put on 35,000 routers, problems. And a survey that we just did went through buying preferences of customers with regards to broadband, and 75% of them said, I would love to have a community WiFi experience. It was a preference because we chose ranking and what are the preferences and that was highly up there. So it represents an opportunity to make money, an opportunity to reduce churn, and we're going to work hard to make sure we give you the capacity to do it. And that capacity comes from this. What you're going to see from Calix in 2027 is something you have never seen us do before. So I told you about how we started AI. I'm not allowed to touch the screen apparently, I'll break it. But November 2023, we started. And then what happened was we peaked in our delivery of 918 in 2024. And then in 2025, we tanked. Last year was a slow year for putting up product that you can consume. Why? Who's running IT product software project because everybody pivots over and humps through the end. And so we had to hump through the end and we did. March 2026, we launched the new product. We launched the third generation of our platform. And Shane stood in front of our Board, Shane, our product leader and made this commitment. We will deliver more capability, AI, PON, all these different elements, automations in 2027 than we have in the last 2 years. Why? Two reasons. One, platform is in. I want to walk through a lot around how our AI and security and all those component parts allow us to go slow to go fast. Second, artificial intelligence is changing our organization, too. I'm a CEO. I have 2 businesses. I have a product team who is serving you, and then I have an enterprise business, just like all of you, I have a CIO, I have these different people, and we are deploying artificial intelligence in everything that we do with our partners. We're not building it because building it is dump. We're using Salesforce. We're using ServiceNow. We're using Oracle. We're using all our partners and everything that they give us from an AI point of view and we're consuming it. We could build it. She's got 900 engineers ready to go and who understand AI deeply than most people but we're not. Because you know what we need to do. We need to focus on you, help you sell, help you market, support your success. We need to be out there humping in the field and helping you crush your competition, not building stuff. It's not Tinkertoy time. To actually focus on the customer and get it done. And Shane gives a great example in our product team. He actually had a product feature that was scheduled inside our organization to take 15 man months, and they did it after our platform, leveraging AI in our processes and our platform in 3. So when he told me that he was going to tell the Board that we're going to do over 1,400 next year, the equivalent of 2 years of work, it's actually more. That adds to 1,300. It's significantly more than we've ever done. I said have Game On. Let's make our customers successful. And as we step into this next stage, the thing we want to talk to you about over the next couple of years or next couple of days is how do we support your success? How do we help you take what we've done with SmartHome and SmartTown, SmartBiz, SmartMDU, agent workforce and all the AI that we are going to be laying out for you to consume as fast as you can to transform because in the end, just like with SmartTown, just like with selling outdoor WiFi, it can't get done if you don't make the choice. You need to move capacity to get selling and leading you need to actually make those changes, transform your team, transform your business and then transform your community because that is something I talk about all the time. And then from a focus point of view, we are not going to chase the shiny nickel and head over to the data center. We're here. We're not on -- I'm not on public investor calls talking about how you're not important. When on my investor calls, I'm talking about is we live and breathe and die with you in the trenches to make sure you compete in that you can take to the bank. And so as we do this event, it's all about how do you compete and win at a faster and faster pace, and it's Game On. Let's start the show. [Presentation]

Good morning, everybody. It's my favorite time of the year because I get to be with all of you. And I'm so excited to share stories today about 3 companies. The challenge the status quo, transform how they operated, to beat the competition and continue to win and win and win. But before we get into the stories, I want to recognize the people that make this conference what it is, and that's all of you. Thank you. Because this -- to me, this is not just an event. This is our community. This is a chance for us to come together, right, representing this entire industry. It's a chance for us to learn. It's a chance to us to share best practices to challenge each other, to collaborate to network to meet new friends and have fun. Did anybody have fun last night at a concert? How is the band? So every year new people have joined this community and bring new energy and new ideas, new thoughts new voices. And if this is your first connection, could you please stand up so we can give you all a warm welcome lights up, you're more welcome, welcome to our community. Thank you. We appreciate you coming. And many of you come back year after year after year. And you not only shape this industry and grow this community you keep the momentum going. If this is your fifth connection or more, will you please stand up, let's see. Again, thank you. Now if you've been to 10 or more connections, please remain standing because you were the ones, you were the pioneers. You were the ones that made this industry what it is. We recognized. Thank you. I'm so inspired by what you do and proud to be part of this community. And what I appreciate about this audience is how much your work matters beyond your own business. right? You keep your communities running connected, you help businesses operate, you help kids learn, you help families stay connected. And we're honored to do this work with you. But having a mission does not make the work any easier, right? We all know that. We still have goals we have to go and deliver. And I've been here 4 years, and none of these goals changed, right? Grows customer expectations, creating efficiencies, but most importantly, competing and winning. And Michael talked about this earlier, right? We've never been in a more competitive environment than we ever have. And I think it's because of those transformation technologies. We're all focused on AI, but there's a lot of other technology innovation that's occurring. It's making it difficult for us to compete the way we've always competed. And our customers have changed as well. They have more sophisticated expectations that are based on their experiences in other industries, right? Other industries have made it really easy, and they expect us to deliver that as well. And the last is these cost pressures that Michael hit on. It's making it more and more difficult to compete. And this makes me think of the tour to France, okay? Stay with me here, you say, why are you going with this? But at any rate, that you never watched, I know many of you watch the tour to France and know the riders, Lands Armstrong. But maybe you don't know about the rate dynamics. Well, you're leaving some beautiful town in France and you're writing out the countryside and the road is flat. And you're in the pack, if you're in the middle of that pack, it becomes a lot easier. Use 30% to 40% less energy, right? And so your kind of weaknesses are hidden. That's what happens when a strong market is happening, right? We may have some weaknesses, but we're pulled along by that market. But that all changes when market conditions get tough, just like what happens in the tour when they hit the first climb. And I think a longer to say, this is the time when it starts to get hard to see -- sit in and conserve energy, but waiting has a cost. The winner has actually changed the game. They accelerate. And if you don't change, you don't stay with them, and they open up a gap. And what happens when you order up that gap at the top of the summit, and they start to go down and business momentum changes to a positive, it's very difficult to catch -- to catch up. In fact, if you watch these races, the writers who are trying to bridge the gap, have to take huge risks right? They go into every corner no breaks. And what happens when you take huge risks, the chances of something bad happening go up exponentially, right? They are out of the race. And we've seen that happen in the business world as well, right? Blackberry fell behind. They tried to catch up and they were out of the race. Happened with Eastman Kodak, right? We know all those stories. And so I went on the search of finding companies that were in challenging positions and took the opportunity to move now, right? And they actually were meeting the velocity of the market that they were in. And I look outside our industry and 3 companies stood out. Each one question some belief and said, maybe there's a different way, we'll change how we operate. And the first one I'm going to cover, I guarantee everybody in this room has done business with them, both at home and at work. And they just get off on the right foot. They had a product problem, and this is what their customers are saying about it, it's Domino's. Let's hear what their customers said. [Presentation]

And you can see, look, most of us as executives would say, hey, we have to protect the brand. What are we going to do? Let's run a campaign that talks about all the great things that we do. It takes courage to go and say, our core product is not very good. But that's exactly what they did. They took ownership and they committed to that, and they took those cuts and they made them into commercial. So he really had to back that up. So let's see what they did. [Presentation]

Now that's great. Their employees were saying very positive things about the product. But does that matter? Absolutely not. What it matters is what the customers thought. And what the customers thought that it was really good pizza, and within a year, they had 14% increase in sales year-over-year, which I would take that any day. And most executives said, "Hey, our challenge was it's all about the pizza, and that would be the game over." Mission accomplished, we're done. But what Domino's knew was that was not the game that they were in. The product had to be good. But what was more important was the experience. And so they went looking for problems and friction anywhere between when you order a pizza and when you get a pizza. And they looked at that. And you heard them say talk about blank slate starting completely over. And the first thing they did was create the pizza app, right? So that you could order digitally in any channel. And what was great about that? Well, customers could reorder. They could go in and see I order this yesterday, hit the button makes it a lot easier. Order processing is better as well. Well, if that's going smooth, what's the next question you have after you order a pizza. We all have the same one. When is it going to get here, right? And they created the pizza tracker. Now what's crazy about this, this is back in 2009, and if you think about it, we're in 2026, and there are companies that still don't do this, right? You have no idea what happens between when you put your order in and the outcome you're looking for. And so they are way ahead of the game, right? You can put your order in and you knew when the chef was making that pizza that went in the oven and it will be in your house in 7 minutes. Now we all love pizza, right? I love pizza in the office. I have pizza at home, but we also love pizza at the beach, in a park, in a parking lot, at a tailgate. And what they did is, hey, through dropping a pin, you can get this pizza delivered anywhere. And they made it again easier for them to get the pizzas. So I challenge you after this conference go out on the street corner in Vegas, go to park, see if you can order and get your app out, give it a try. Now what were the results of doing all this, changing that experience. Well, they were phenomenal, right? They went from 30% to 85% digital channel. And why? I said this earlier, why was that important? Because they knew more about the customers. They knew all kinds of data, what they're buying behavior, where it was and when they're getting orders, how frequently. And there's a story when I was researching that actually didn't believe there was a gentleman that ordered pizza every day for 10 years. And I'm thinking, boy, that might have killed him. Quite the opposite was true. He didn't order for 4 days. They noticed that. They send a pizza delivery car orders as he was having a medical emergency. Pizza saved his life, which is crazy, right? And that's how they became the #1 pizza company in the world. Now last year, I was on stage saying I missed the opportunity to invest in Amazon and Google. And just for kicks, I said, "We I wonder how Domino's did. What was their growth?" Let's take a look. Is that back check beyond that is true. I couldn't believe it either. So let's wrap up. What was the conventional. They said, "Hey, we're a pizza company." That's what most people said, I make pizza. The only thing that matters is the pizza and they said, no. The pizza has got to be good, but the experience wins every single time. And I think we all can learn from that. Every lesson that I went through when I was doing this research was like we need to apply this as a Calix as well. This is not just about you. All right. The next story is about, I would say, how we work. Every one of us in this room doesn't have enough capacity to do all the things that we want to do, right? But we're often hesitant to change how we work, right? We say, "Hey, if it's working, don't fix it, it's fine." Just leave it alone, it's buying, right? And that sounds like discipline, but it's actually neglect. It's actually neglect because there's a huge opportunity because a lot of the things that we've done started years and years and years ago. And if you think about how many business conditions changed, how many products you added, how the business is approached today. Well, you just added all that stuff on to the work. Well, this company, Shopify did something different. Now if you know Toby Luca, he's a bit of a maverick, and he had this blank slate mindset. And I worked for a similar CEO. He always said to me, start with the beginner's mind. Everything you do should be thinking about how do you disrupt our own company? Like if you had -- if you were building a company, what would you do to compete against us, and then whenever that is, we should be doing that. Well, his COO is inspired by these words of a blank mindset. And what did you do? He went into their scheduling system and he deleted every single meeting that had 3 or more people, immediately creating 320,000 hours. It was equivalent of adding 150 new people to the organization. Think about what you could all do if you've got 150 new people in your organization. Now look, I know that they were going to add meetings back, but it was a forcing function. The easy thing would let business continue on. But what you did, you challenge them in saying, are these meetings important? Are we working on the most important things, right, and only add the most important back in. So they really looked at that so they can make a bigger impact. But it didn't stop there. I think you guys all remember this last year when Toby's memo got into the media, Toby had said, no one can hire a new employee and tell -- unless you can prove to the leadership team that you can't do with an agent, okay? And what was important about that is the easy thing is to continue to add people, right? I did it in my last company. There comes a point when that's not a good idea, and he was trying to stop that before. He was trying to make people think, is there a better way? Should there be something else we're doing? Should there's a different way of working? But you just didn't do a mandate because mandates really don't work, right? You put friction there, but then he also democratized all of the tools. And it wasn't just a tool, he provided training, you provided resources and provided experts. And what happened is, of course, the engineering team led the way, and they got a lot of productivity, just like our engineering team led the way when we were doing this. But then the other functions did as well because they knew where the problems were, and they can solve them themselves. And this is great. They had a high adoption of AI. It started to get into the organization. But Toby understood that mandates and adoption weren't probably going to be good enough. He actually had to tell people what should we be doing differently. And what are we still accountable for? And Michael told us this the other day, he's building this game app, ask them all about. He's very proud of the work he's doing with it. Welcome to the game, Michael, someone has already been doing this for a year. But he built a Chief-of-Staff AI tool. And that Chief-of-Staff AI tool would call other agents, agents around finance and product and operations. And what he was doing was collecting information. He was trying to have different points of view from different experts. And when he told the organization, this is helpful, but I still own the decision. It's still me. And I want to have different points of view. That's still very important. And then the last thing that occurs in any organization, we all have the few people that aren't very productive and we give them okay? And what it actually does is run the productivity for the rest of the team because why? They just use AI and then they put it out. And this happened last week. I don't know if you saw the article. You said no more swap, right? Is that everybody that's using AI, we think it's great, but you have to have accountability for the output that you're creating? You own that. And so that was very important. And so they adopted another framework around making sure that people weren't doing that. We've all seen that, right? We've got a presentation, you could tell that somebody just went to and said, build it, the same sentence in there 4 or 5x. We can't do that, right? We have to change everything. So what conventional wisdom at question. If it don't -- if it's working, don't fix it, to say, start with the beginner's mind. And that's difficult. We're doing a lot of transformation at Calix that I'm responsible for. It's very hard to change people's habits. But if you start with that beginner's mind or a blank slate, it can happen. The next story I want to tell you about is around adding more value to the customer. Here's a product that probably many of us had back in the day, it was a Fitbit. Did anybody have a Fitbit? Probably many of you had a Fitbit. And it told you how many steps. That was revolutionary. But after a while, you said, why am I walking 10,000 steps? I have no idea, right? They were giving you data, right? The conventional wisdom was that data was important because it tells customers something, but they were leaving the responsibility of my help of interpreting that data, making a plan. And so that's not everybody's kind of jam. So there was a lot of attrition. Along came Aura, who asked a very different question. And they said, what should the data tell you to do, right? Give you insight, give you action. How many people have a wearable, the lights up, banned. Okay. More important question is, how many changed the behavior because of that? Let see how many hands. All right. I want you all on my team because you're all very coachable. The rest of us, including myself, are not coachable, and we need a lot more help. And that's what Aura focused on, right? And I'm going to share my personal data that's coming off my ring, leading up the connections. It's very ugly. The first one is data, averaging 5 hours and 40 minutes of sleep. It's not great. I knew that. The ring didn't need to tell me that. It's been a terrible week of preparation and no sleep, okay? But what it did tell me was, hey, John, this has been happening longer than this week run-up. And you're going to have a serious health condition if you don't take care of this, right? You're working in 15 hours of sleep debt. You're not showing up at work in your best or at home. Well, that's great. I realize the importance of this. But what's really more important is what it told me next. It didn't tell me go to bed at 11, right? That's a directive. It said, "Hey, you need to adopt a wind-down routine. And if you don't have one, let me give you some tips on how that works. Now many of you may have had a band or a ring and abandoned it. You put it in the drawer and didn't use it, most likely because you didn't have an adviser. And what's great about this is you can ask this adviser through AI to really help guide you. Now many of us are not going to take all of our guidance from an application. So what do they do? They connect this data back to your primary health physician. And that primary physician has a lot more data. and probably can convince you that you may need to make behavioral change. This is a very competitive landscape, right? And so how has this gone when they try to make more and more action with the data, do something with the data. Well, I think the most important metric here is this one because the first year is free, right? When you buy your ring. But that 85% people continuing on with their subscription is enormous. Especially if you know the industry average is 20% to 30%. That's 50% higher than any other company in that space, right? So they're really getting it right with the insight to action. And so what did they do? They challenge this conventional wisdom that data is going to tell you customers what happen, and they're going to be to act on it. And we know that's not the case, right? What it is, is Insight amplifies value, which we all have to do. Now look, all these transformations that we just talked about, they are not easy, right? They're hard. Nobody wakes up on a Tuesday and says, "You know what, I think I'm going to do, I'm going to go look at our life cycle, both product and customer and start over." And we are doing this accounts. It is hard work. It has a cost. But by doing it now, you can be like the cyclist in this video, and you can break away, right? This is where it happens. This is where transformation can put you ahead and continue to have you win. So there's a really easy framework that you can follow. One, I would ask all of you to think about challenging conventional wisdom. There's something you're doing today that may have been something you've always done that may not be the right thing. Second, how would you transform how you operate? And then lastly, Michael talked about this a little bit, technology can help you accelerate, right, pull away from your competition and win, right, and continue to win. So what's your takeaway? If you're like me, you're still probably back on Domino's thinking, "God, I'm hungry, I wish I had a pizza or more breakfast or you said to yourself, "I wish I knew my readiness score." Well, so folks who are sitting right over here, should look underneath your chair because 46 of you are going to win both in OURA ring or some Domino's Pizza. So take a look. Turn the lights up, see where the winter is ours. Underneath your chair. There you go. All right. If you want something hang down. There's 46 prices under there. And by the way, you guys should know this about me, every time I come up here, I give out a prize. So congratulations to all the winners. Thanks, and enjoy the rest of the show. [Presentation]

Please welcome back Michael Weening.

All right. Congratulations to all of those who won an OURA ring. I'm going to let you in on a little secret. There's more at the front. So next year, if something happens, perhaps that's a good little hint around where they'll be just saying John was really inspiring when he talked about a transformation and what the payoff is. This is flat out absolutely every single year, my favorite slide for us to put together and my favorite slide to present. Why? Because you're awesome. John talked about the fact that we're a community. John talked about the fact that you go into your businesses and you change them. Nathan Stoke, all these other folks everybody is doing this every single day. They're going into places that were neglected and you're changing how those towns and cities operate. It's filled with all the awesome things you can do. And as you can see, our platform through this partnership is helping us do amazing things together where we deliver results that, frankly, are the envy of any industry, flat out. You tell me an industry that can put up customer effort, customer after customer who can say, my NPS is over 75. It doesn't exist. It doesn't exist. And so when I look at these numbers, 4.9 out of 5 launch score satisfaction at Bluestream fiber, who's been partnering really closely with us to make sure that SmartMDU helps you crush everybody in every apartment building and do it at an incredibly profitable level. 50 gigs in the trial with Astounds, 200% increase in SmartBiz subscribers, 64% SmartBiz adoption goal. 80 markets in the ecosystem with Conexon, 16% growth in ARPU. Everyone's talking about the ARPU pressures we're under, well, there's one 16% growth on and on and on. 133% achievement on their small business goals, 50% unnecessary truck rolls gone. This is what we do today with a platform that can do anything by working together to understand where you want to go, what are the KPIs that you have and how do we make them better, 40% reduction in service calls per month at P River. These translate to one thing, profitability. Because capital cost is not the focal point, if you want to run a long-term business. Everybody knows, you can go back to the days of IBM when IBM got turned around, it's about one thing. Cash flow, profit. And you know what, if you're a member led and you're saying, "Well, I'm a member-led cooperative, nonsense." You know what your members want to hear. They want to hear that we're making more money, put some money in their genes. Do more things for the community, transform more. And if you're investor-led, I'm investor-led. That's the question every day. And let's be really clear, you can do great things and still be great profit. That's what the platform does, and that's the power of what we do every single day. And let's give you a big round of applause because these are awesome results. And for the other 20 slides of these numbers that I couldn't put up know that we went through the mall. There are so many of you accomplishing these types of goals every single day that I couldn't put them all up. And this togetherness is what roots our company and the success that we've had with you. It's why you're successful because you're a community. If I go back to the engagement, you've invested the time around talking to us, you've invested in the time in our advisory boards. You've invested the time with our success teams to understand problems and make things better. We have done the same thing and invested over 15 years into our platform. We've invested over $2 billion. This year alone, we'll put over almost $200 million into our platform to do one thing. Not to go chase new markets and data centers and all those other things to do one thing to make you successful. And so it's worth taking a moment to reflect on what you have because what you have in your networks in the subscriber's prem is about to be unleashed at a level we've never been able to do before. But to be really clear, we've always known it's coming. And so in that network and in that prem, you have 2 pieces of it. The first is everything that we're doing on access. Let's be really clear. This is the most profound shift that we did 8 years ago from an architecture point of view that Verizon has chosen that Bright speed has chosen and many others to transform the network. And it starts with investing -- I believe we invested about $1 billion to build this operating system roughly, and it has these 4 capabilities. And the first is the most important functional consolidation. If you are running a network today that has a Nokia BNG or a Juniper BNG in it, you are disadvantaged. If you're running access aggregation, BNG and you don't run a tiny itsy-bitsy Cisco PE router because you put MPLS on our stack, you are disadvantaged. Why? Because if you run 4 boxes versus running 1, who's got the advantage in a world where automation is the future? If you can virtualize the data path through the network through a single Unit 2 extended with an E7-2 and an E3-2, you're going to crush everybody from a cost point of view. Why? Because you don't need 4 teams who go to 4 conferences and take 4 training things. You need 1 team. They can run the whole thing. And anybody who tells you that you can't have a plan to rip your Nokia and Juniper BNG out of your network over the next 5 years is wrong. And if they want to have that challenge, Shane and I would gladly meet with you. Because Verizon just went through a massive RFP to actually go through the next stage of where they're going with their network and you know what they did, they did it again because this works. If I can go from 4 boxes down to 1 box, I am saving a fortune, but more importantly, that is an AI beast because now that entire data path is under control of automation that's never been seen before. It represents a massive opportunity. And if you're not walking out of here and saying, how do I kill my BNG, you're missing an opportunity. You're missing a huge opportunity. And so we built the modular operating system that gives us the flexibility to run different functions in a container. And then inside of that, and this is why that virtualization of the data path is so important, we have telemetry policy content and cyber, sitting in that system that gives you the flexibility to do incredible things because now what you have is the flexibility of physics and economics. We're going to talk about the future of AI in a minute. Let's be really clear. AI is not going to be in the cloud. AI is going to be on every single device. And it's going to sit on an E9-2 in your network stopping Russian hackers. That's what it's going to do. you have to make that choice because if you actually daisy chain 4 boxes together, you know what happens with that stuff. It just breaks. It just breaks. And everyone's selling you, how do I put an aggregation layer on top of it, so I can orchestrate across the 4 boxes, that's death. Simplicity wins and it drives profitability so that you can actually run your business successfully and make your community and your investors happy. If you don't make the hard choice to step up and get it done, you will fall behind. Because of Brightspeed or Verizon, if they come into your market, they're going to crush you because their cost level is going to be dramatically lower. Verizon is clearly quoted 80% lower cost to run a network than they had Nokia and Juniper BNGs, when they had the big Cisco PE routers, we run MPLS. And if we can do it for Verizon, who's bought Lord knows how many E9-2's from us, we can do it for you. So you've got to make the hard choices because you got to free up that capacity to sell because the future is all about selling and marketing because you build your network, now how are you going to fill it? How do you got to make sure you got 90% market share? Because you can do it, you can do it if you have the right cost structure. And artificial intelligence gives us the flexibility to decide where do we put AI because with the physics and economics model like we built, which is in singing technology on an E9-2 or an E7-2, we now have the flexibility to say, you know what, I'm going to run a small containerized AI at the edge, and then I'm going to run some functions in the cloud, but I have the choice, you're going to decide from a physics how fast do I need to do it and they can decide from economics, that's a free processor, waiting for me to leverage. That's the future. And we've been building towards that for 15 years. We did the same thing on prem. So people can go on about WiFi this and test that and you can put it in your basement and the like, oh, geez, it get a little bit better by the pool." It doesn't matter. It doesn't matter. What matters is the operating system that's running on top of it, which does 2 things: One, it gives you the flexibility regardless of use case, I can use all of these systems in a home, in a business, and in MDU and soon in a hotel in an event, all these different spaces. I can mix and match them infinitely to meet any use case. And then I can run different software, SmartHomes, SmartTown, SmartBiz, SmartMDU and the other products like hospitality and things we're going to provide you. I can run them wherever I need to run them using the same systems. So what does that mean? What that means that where I used one vendor, ubiquity to do business, and I ran SmartMDU with Ruckus, Sayonara I don't need that anymore. I don't need those teams. I don't need that complexity in my business. I can run all of it with one team. And what does that mean? You cross everybody because you're simple. And what do your customers want? They want you to be simple. And yes, we will do things like Shane and his organization, we're rolling out right now the ability to manage ADTRAN. We're rolling out the ability to Nokia with Operations Cloud. We'll do that. So we'll partner with you as you go through these transitions to get to the right place to set your business up to be successful for the next 10 years. And on this case, so we've got the operating system with the same rich telemetry. We pull 300 data points a minute out of every single GigaSpire. Why? So you can deliver the best experience possible. And then same thing, physics and economics. The future of AI is at a local level on the edge, and we've got all that processing power just waiting for us to leverage together to give the best experiences. And then over top of it, we have everything we're doing on the cloud and where we're going with AI. And on the AI front, last year, I walked you through what we're doing for 2.5 years. Well, we are building this. And this stack has a couple of important parts to it. The first is we went down the path of an open-weight model to make sure everybody understands what an open-weight model is an open-weight model, if you look at what AI really is, the Magic AI is how you train it and then how you weight that training. So in other words, the AI is learning how to judge, how to make decisions. And what's fascinating and the reason why, from my perspective, Anthropic and OpenAI are screwed. And you saw Anthropic lose $0.5 trillion worth of its market cap. I think it was last week, is because of the fact that the future is open-weight models. Why? This is really important to understand because the beasts who are running these open-weight models and making them available to big companies is actually Google running Gema, Meta running Llama, Maestro, PIE by Microsoft and Nemotron by NVIDIA. And so they were available for the companies who can actually leverage them to be successful. And Shane and his organization started there, they implemented the RAG model so that we could take these open-weight models and put control around them. But more importantly, what do you think that those guys are going to do. They've got more money than got for current out lab, like they have so much money. And so they're going to pile money into it and they're going to compete. And one day, Llam is going to be ahead, the next day, something else is going to be head."they're going to be pingponging". And the great thing that we built in our architecture is we can run one of them or we can run all of them based upon who's best for a use case. But most important, we can rip the brain out. We can rip an open-weight model out quickly and easily and switch to someone else. It gives us the ultimate flexibility to stay ahead as they go beat the c*** out of each other. And they will invest. The reason why Anthropic and OpenAI are in trouble is because you know what those guys don't need to do, make a penny on AI. All the revenue streams are somewhere else. So they're just going to keep investing, and that benefits this community in a huge way. So we put that in place. It was hard. It was hard. Hundreds of millions of dollars, 2.5 years of work to get to where we are today. And then what we did was on top of it is we built the layers that allow you to have something that's trusted, secure and predictable. First, we built the data layer. The data layer was a single database, aggregating and it's bringing all of that great information from your access network from your subscriber solutions, got standards to go and get third-party information and then back to the pool and the pond. Well, we can collect that information and put it in the data layer 2. So we cleaned up that data. Then we extended that data through something called MCP. I talked about MCP. MCP is the ability to get to knowledge. And in the end, how does an AI engine work? It works through knowledge, data by itself, any of those us who have run data warehousing projects and I've run some really big ones through my career. Now, the data by itself is worthless. What has to come out of it what are the correlations? What are the insights? What are the actions I'm going to take to make my business better? And that's what knowledge is. We built a full knowledge layer to look at all that data and do the correlations. A, plus F, plus C equals an outcome, equals an opportunity, equals an unhappy customer equals churn. These correlations is what's in the knowledge layer. And then through MCP, we extended it so we can grab the correlations that other systems are actually leveraging and bring them into our knowledge layer so that our AI engine can make smarter and smarter decisions with your humans. Because in the end, this knowledge is all around how do you augment the performance of your teams. So we put that in place. Next, big next. We acted with AI as if it was an employee. Just like in your businesses, you don't let all your employees go in and change everyone's salaries. You can't do that. You have to have a trust layer in place, an identity layer in place, which means that every single agent, every single workflow has tight controls on what systems can be touched, whether it can be edited, whether it can be deleted, whether it can be updated, all these different component parts that was a huge, huge investment because if you haven't read the news about OpenAI and Anthropic talking about these AI agents going crazy and escaping. That's what we had to control. And we did. Then we put orchestration in place and orchestration is just how we work everything that we do every day, when I show up in the morning, I execute workflows. I have a goal. I have a process that I do it with, I work with different team members, we interact, we make decisions and then we have an outcome. That's a workflow, and it requires an orchestration layer because orchestration requires you and AI doing all these different things to drive the outcomes. So we built the trust and orchestration layer and then that finally led to the agents. And the agents are the ones you started to see, these are the folks who are actually executing every single day with your team members to make them great operations, service, marketing subscriber, you know what you're going to see soon, Cyber, a couple of other things popping up there. Why? Because they're part of your team. But they're tightly controlled to ensure that what we do is right. And that control is really important because the opportunity ahead is significant. I go back to my statement. There is no future that doesn't -- isn't buried in AI. AI is everywhere. And the opportunity is, look, they're massive. 29% reduction or increase in breast cancer detection. That's incredible. 2,000-year-old scroll that all the scholars behind their tenured leather desks couldn't figure out. 80-year-old math problem solved with a single prompt story about that one as he kicked it off before I went to a football matching the World Cup, new DNA. The things that are going to happen are going to change human kind. But at the same time, sadly, bad people do bad things faster. And we got to make sure that we're stopping them. We have to stop. We have to put layers in place that stop the intrusion of malicious AI into the network, into our stack. And as you see, the risk is getting bigger. The biggest threat as we go into 2027 is not like some bombing or things like that. It's actually nation state attacks through AI cyber attacks, where they go shut down an entire state and knock a grid down. These are the things that we have to protect against, 89% increase in AI tax, 200 organization break -- breached, 700x agents. That big red scary thing is what our Board talks about for 2 or 3 hours every quarter. That cyber meeting has expanded from a 30-minute meeting into 3 hours of deep analysis. And it's what Shane's team wakes up every single day and thinks about it. And that stack helps you manage both the opportunity and the risk. And it delivers 3 things: trust, security and predictability and trust, I have a funny story. So there's this guy, Jackson Jones, who I heard about a month ago, it came up to me, I'm not sure how it came up to me, but someone mentioned that a kid tried to convince our AI agent that had worked at McDonald's, which I found quite funny. And so I started to dig into what did Jackson Jones do. By the way, I have his permission, let's just say, freaked out a little when I e-mailed them, can I put you on stage. And so what Jackson Jones did was he said, "Okay, let's test trust." Will the Calix agent just do what it's supposed to do? And what he did was he actually tested a human theory that is used by lawyers, 3-letter organizations and police to break people. and it's called repetitive exhaustion. If you actually go look it up, human nature is that when you get asked the question 3, 4, 5, 6, 7 times, the same question, bang, bang, bang, question, question, question. What happens is humans will start to break you'll become emotionally overloaded and you'll start to get confused in your brain. And all of a sudden, you'll start thinking, okay, what did I say, what maybe it was this and then you start to get confused. It's a proven tactic used by these organizations and by lawyers in court. And so when he tested the theory, can he apply a repetitive exhaustion to an agent to convince it that it should answer a McDonald's. And the question you asked is how many calories are in a McDouble? Now I am a Canadian. So when I heard McDouble what I thought of was a coffee with 2 creams. So I didn't actually know what to McDouble was because I only eat an egg McMuffin and I'm going to have a big Mac. I figured it out, okay, it's 2 patty cheeseburger, right? And he pounded it and after 51 times it relented and it gave up the ghost. It said, "you know what, 390 calories." But most people, that was, in essence, a malicious attack an intent by a human to try and break it. And so we've actually -- we learned from it. Shane and his team saying how that happened so they actually put it in. So that's not happening again. So thanks to him for helping us all get better. But more importantly, how many people in your call center are going to take the time to pound on something 51 times to try and break it? They're not. If they had asked that question 3 or 4 times, the trust is in place with regards to what our system and our platform does to ensure that it would only give the answers it should. And the answer every time was, I don't do that. No, I don't work at renals? It actually made the right moves. Now more importantly, because our platform is incredibly secure, again, unless you got to come $100 million to spare and a lot of knowledge, that's what it costs to basically also make sure that Jackson didn't see customer data wasn't able to execute an action and no system was impacted. Because in the end, that's the most important thing is that your employees do the right things that they're allowed to do with great insight. And that great insight leads to the last one, which is predictability. And predictability of outcomes is really important, but also predictability of cost. We've all been reading about the cost of tokens, and how budgets blow out. Uber here wrote, they blew out their AI budget in 4 months. More importantly, I don't know if they got an ROI because it only was participating in 10% of their code. That's not a lot. And the ROI is the big thing because it's great to go do AI stuff, but if it isn't actually focused on what you do every day, it's of no value, it's playing with Tinkertoys. And so what we need to do is what you do all the time, that we do together. These are results you're doing without AI. 500% boost in monthly curing revenue, 35% reduction in support calls. NPS share in value of 88. That's what we do today on a platform that is just rolling this out. Imagine what we're going to do when we go to that next level, and apply all of those engagements and workflows and insights into how we partner into building out the greatest workflows in the market, which now leads me to the last piece to understand that the future of AI, there is a monster change coming. And look, I talked about these guys over here. These open-weight model guys. I'll get to him in a sec. So these open weights are fantastic, right? But they're 30 billion and 40 billion parameters, they're running in massive data centers. And even if you have big checks to write, you're not guaranteed you're going to get an outcome. The latest one from Meta was like, I think, 0.5 trillion parameters. These are huge models. And while it can paint John on a unicorn in a pink suit, which is a lot of fun. And it is funny that he wore a shirt with his jacket as an Easter egg. You don't need that to run a broadband provider, do you? You don't need to create the cool videos that we've been showing. What you need is network insights, WiFi, you need the things that you need to do every single day in an AI model, which is why the next wave is for those of us who have the investment capacity, the Monster teams, we are in the process of going through a next stage which is how do you take these massive overcapacity capabilities and how do you drive them down into something smaller and more consumable, so it can exist anywhere. How do you do specialized domain expertise? How do you make it cost effective through specialization. How do you make it faster because it's not thinking about, I can paint John on a unicorn. We just know that it's going to run a great network. It's going to find a new subscribers. It's going to drive your upsell, and it's going to help you be wildly efficient because we know broadband. That's the next stage of the market. And it's rightsized for the use case, which is why I'm proud to announce Calix Communications language model foundation. That is the first and last time you will ever hear me say communications language model foundation. We will call it CLM Foundation. And what CLM Foundation is our AI teams, investing a significant amount of time and money into building out how do we take that from a process point of view and drive it into something that can be consumed and it just cares about your business. The difference between that and this is the insight. This insights into $5 billion workflows, insights into what's important in your business, insights in what it takes to run a broadband company. This is a huge amount of work, but what it's going to do is pay off because all of a sudden, we're going to free up a lot of capacity in your networks to do great things. And these foundations, it's not just 1. There's 1 to start. There's going to be 10, 15, 20 of these because of the fact that as this changes, you have to keep up with a piece of change that's never been seen in human history. We have to go fast. And so our teams have built out repeatable models to take 30 billion parameter models and turn them into $3 billion, $2 billion, $1 billion, $100 million, actually really different and what those are is what you're going to start seeing in your release cycles. They're called Calix gems. And what a gem is, is think of it as a category, marketing, security, repair, troubleshooting, and what we're doing is we're taking those foundational language models, and we're running them through a process to make them even smaller. And there'll be size large, medium, small, extra small. And a good example in cyber is going to be an extra small language model that we at Calix have curated and trained to run on a GigaSpire to stop all the bad things from happening inside a subscriber's business in home. A medium one maybe, which is going to run on one of our managed network products so that actually can protect all your business subscribers. And what you're going to see is that over the coming months, you don't have to really care about this. You just need to know what we're doing and why we're doing it. because the way it's going to show up is new workflows, new capabilities, new advancements that your teams can have that our success team will work with you to understand how you can move faster and faster and faster? How you can drive cost out of your business and how you can win more customers? And this is a big step forward for us and what these gems are going to do is sit out in the network. And look, the reason why we're doing that is back to the pace of change. Because we have invested so massively in your business and you've invested in your business putting E9-2s, E7-2s, E3-2s and putting GigaSpires, all of that technology in your networks and in your customers' premises and then run with our clouds. What we can do is we can beat this together. And what this is, is that every week, there is going to be yet another titanic shift in the world, wild. Last week was like one of the biggest weeks in history. If you think about some of the things that are going on with regards to AI. So someone stole all of Adobe stuff with AI and basically created an AI knockoff of Adobe. Bigger yet, hacker wet and hacked into Sony PlayStation, took all of their IP just before. If you're a gamer, you know GTA 6, you don't want your kids playing that. I'm just saying, but if you know GTA 6 and it's just before that launch, that I think prints money. It's more profitable than drug running. That's for sure. And so in GTA 6, when that comes out, if every PlayStation game is now available, Well, GTA 6, good luck making money, and it was all done with AI. From a human point of view, I've been theorizing on this or on LinkedIn for quite a while. Apple is the dark horse in AI. Why? Because every Apple device has an M chip. If you want to really understand what Apple has been doing, they've been building out chips onto all of their devices so they can do one thing, run AI locally. And Meta, came out this week in an announcement with Apple with Apple Developer in a couple of clicks, you can actually run their open source model, that open weight model, a version of it, which does certain things on your desktop. And you're going to see more and more of this. And then Meta to compete with a bunch of big companies out there like Kimi and others released one of the biggest model -- AI models and most capable AI models, an open-weight model ever, $0.5 billion parameters -- sorry, $0.5 trillion parameters. And so you're going to see these types of titanic shifts every single day. So the question becomes, you actually try to chase that horse or you're partnering with us because we've done it all. And what we spent in the last 3 years and over $2 billion, we've got another $200 million going into it this year to make sure they don't have to worry about chasing that horse. We're doing it for you, and we're doing it with you. Because, again, back to our capacity, Shane and his organization are ready to listen and we have a lot of capacity to make sure that you can crush your competition with what we're doing every single day. And look, this is where that's going to sit. You're going to see significant shifts of AI coming down the edge. And we made it simple with an enterprise agreement so you can just consume it all. And what is going to happen is all these localized AI is going to start popping up there. It's going to start popping up there. And then tagged in with the agents, you're going to start seeing automations pop out. And your biggest thing you're going to have to work on is which of this abundance, am I going to pick first to help my team understand and grow. Because in the end, most of us are the same way. We want to see operating costs stay like this or go down a little bit and want to see revenue go like this. It's about how do we help our teams do more with less. None of us are not busy. And look, the question we get all the time is it's great, you're up here, you're talking about AI. What all about all of your other stuff? You do hardware you add, Heckes, best in market, flat out absolutely, 100%. And if you look at what we're doing on 50 gig PON, we have managed switches coming out, go to the innovation showcase and look at what we've done for managed switches. Why do we do manage switches? Well, you want to do them in MDUs. In fact, if you look at an MDU, what is an MDU? It's actually a network ecosystem. And in fact, if you run an 72 at the bottom of an MDU and run it with all the different technologies, whether it's copper or fiber or whatever it is, you can actually run the entire building in a very unique way, and you're going to see us doing that. We're actually already on the path of well doing down the path of doing it, but also needs managed switches because just like in your network, Juniper and others are there and they shouldn't be. Rip them out, put in a single system, running software and actually making it so that MDU can actually run with a single stack and a single team. There's no room for Nokia or a Juniper in that building, out. There's no room for Ruckus, out. Put a single system right into the subscriber and give them the greatest experience, more importantly, give you incredible profitability and to sit down with a building owner and say, you are going to have people loving it when they live in your rental apartment. And so we have a full managed switch portfolio that's come out. We also have some small ones so that you can put them into consumers' homes. And it's not the fancy people who have 10,000 square foot houses who need switches at their house. That's nonsense. Actually, I was asking somebody who has a 2,500 square foot house because I was in this argument and the product marketing team was saying, you can't say prosumer, and they said, "I'm not going to say prosumer, I'm going to say consumer." Because it's nonsense and the person was there and she goes, "Hey, I overheard your conversation now with 25 square foot house." Here is my basement, and she had 3 crappy switches downstairs. From NETGEAR that are unmanaged, that caused problems. So what you're going to be able to do is when that -- and how many of us have had that call, all of us. So now we're a managed switches, so you can actually extend service clouds or if they're having a problem, you're running it as if it was a the spoke to and you can see everything top to bottom. We'll be the first on WiFi 8, workflows and agents. We talked about that, everything we're doing around SmartMDU. We have -- how many people have launched smartwatch, Smartwatch is identity protection. It gives you the flexibility to give it to all of your customers for free, so grandma can't get hacked. And then you can upsell to Scan Watch Pro. A great service if your brand is about, I care about my community. And then last, we're going to come out with significant investments in grid monitoring for utilities because we've been asked. Many of our customers are broadband companies, but they're also utilities, and they want us to actually put SCADA and all those other capabilities into the network so you can run the most unbreakable network if you're running a utility. And that's all kind because chains team has a ton of capacity and now we go fast, go slow to go fast. Now we go fast. And on outdoor WiFi, the new WiFi 7 outdoor unit is in phase in mass in February, lots people -- lots of customers are already testing it. So you can get back that $10 a year old. And so as we think about this, there is going to be an abundance of choice. We're going to give you everything that you asked for, at a faster and faster and faster pace. So that you can work with your teams, the operations, service, marketing, subscriber teams to change how you run your business so you can go to that next level and frankly, compete and win. And after the break, I'm going to have 4 amazing leaders come up on the stage, and we're going to talk about how they're using what we're doing on the platform in AI and how they're envisioning what happens next. And so with that, go have a break. We'll see you back here in 10 minutes.

Thank you, everyone, for joining us this morning. This is a 10-minute break. We will begin promptly. You do not want to miss the opening of the next session. So please be back in time. Thank you. [Break]

Glad he left the guest network open. Check this out I love this stuff. Please welcome back Michael Weening. Well, I'd like to start by saying in no way shape or form did I do being eaten by a zombie, but I got overruled. Look, I started out with this. There's no version of the future where AI is optional. Did you see what we just did on that video. To understand the magnitude of change, I think this is a great example because for us to assemble that today versus what it took us 2 years ago. 2 years ago to do 3 videos for this help you amplify your sales and marketing cost us $800,000 to $1 million. It took days and days. It took like 50, 70 people. We can now do this with 3 or 4 really smart people using artificial intelligence and look at how incredible it is. The change is coming. And while we can push back on this and we can deny it and we can take -- think that I've got more time, get don't. get don't. You either embrace artificial intelligence or you get right. And the great thing is, we saw this coming where we learned how to collaborate how to share, how to understand what you need to be successful to lower your costs and improve your profitability to win subscribers and change the communities you serve. That's what we've been doing together for the last 15 years. That's what our $200 million this year, just for you, not chasing after some data center because that's the shiny nickel just for you because you're really important, that's what it's going to do for you as we go through 2027 at a pace we've never been able to match before. As I said, we will do more in 2027 than we did in 2025 and in 2026. Significant jump up and it just comes down to, you have to choose a transform. And so to go to this next step and talk about how do you transform? How do you lead your teams through this? What's the opportunity ahead? I have 4 incredible customers who are going to -- who collaborate with us every day who push us to be better so that all of you can benefit and that their teams can benefit.

And with that, I'd like to invite the first person on stage. Let's kick it off. Shane West, the new CEO of Allo.

Allo serves as just over 250,000 total subscribers across its footprint in Nebraska, Colorado and Arizona, where we've seen the most significant increases in ARPU, have really been our switch to DirectTV, a streaming platform that we use for video service as well as business-to-business security platforms, which allowed us to better serve our commercial subscribers. SmartTown is a key part of our strategy. SmartTown has allowed us to differentiate ourselves from our competition by extending our broadband service beyond the home and into the communities we serve. So when our customers leave their homes and go out into their communities, whether it's the park or a public event, they take that great Allo experience with them, and it's a real differentiator in our communities. The relationship that Allo and Calix has is probably one of the most unique relationships I've seen between 2 providers in this business. I've been in this industry for 30 years and have not seen the level of partnership and coordination and focus on being successful together than these 2 companies.

Thank you, Shane. Nice to see you. Welcome. Welcome to Connexions.

Thank you, Michael.

All right. So let's tell everybody. The first thing is you came from a multi-vendor environment, right? You saw the complexity in all those different component parts. You became the new CEO of Allo. You move over into this deep partnership that we've had and why don't you share kind of how that's gone and what your observations are.

It's been great so far. Michael is right. You heard about it a little bit earlier, but I'm used to running multi-platform networks, a lot of complexity there. But one of the things I can tell you, complexity isn't free. Our teams, when you start running multi-platform networks, our teams are spending time, troubleshooting, integrating systems, just simply spending time moving data from one side to the other to figure out what's going on with their network.

Why, and who's broken?

Yes. Absolutely. Nobody know you don't have visibility to know where it's broken, what is happening there. And ultimately, what that does is drives up the total cost of owners for the network. We spend a lot of time being less efficient and ultimately, it negatively impacts the customer experience.

All right. So the first statistic I'd like you to share is that in your previous company, you had 400 -- how many people in IT versus how many people in IT you have here?

Yes. So this complexity that I'm talking about is the difference between having a 25-person IT staff and a 400-person IT staff, building integrations simply moving information from one screen to the next for our teammates.

Well, I'm trying to figure out if back to the BNG and all these other component parts, I got to figure out who's capable and who broke it.

Absolutely. And then you're pointing fingers at each other trying to figure out what is happening with that customer experience.

Well, and I remember when you first started because we've known each other for a long time, right? And so, can you share the story of you're like this can't -- the data can't be right. So you looked at truck rolls and it was fiber to fiber Allo with Calix and then another company with multivendor and all that complexity with those 400 IT people trying to manage the mass. What was -- what was the difference? Because you got to talk about how you didn't believe it.

So the one thing I did here when I came to Allo, the first thing I did is I looked at the trouble ticket index, the percentage of customers that have a trouble in a particular month. And I'm looking at this, I'm like the numbers just are not right. They're not wrong.

Someone's lying, I'm the new CEO, someone's lying.

Like something is off here. And the trouble ticket index at Allo, where we run one platform is 40% less than a multiplatform network. And the first thing I did was call somebody I knew and he was like, "Do you realize what happens to handing off from a Nokia network to god forbid homegrown middleware, right, to something at the end, whatever that in the home solution is. And he's like, no, it's the end-to-end solution.

Well, and then you also looked at MPS. And so they're running multiple platforms for subscriber. And the difference in NPS was what, 0 and...

40.

Right. Yes, 60 here.

Yes. 60 at Allo, actually, 0...

60 like I think. There's 60, 70 and then versus 0, right? And so there's a profound shift in difference. And again, the difference is it people, right?

And it's the customer experience, showing up in MPS, it's the customer experience showing up in churn, and it's a cost structure component because you're spending time building these integrations. That stuff doesn't cost -- that's not free, I mean especially in a world where we're all more competitive for IT resource.

One, especially if you're homegrown. What happens when like we all go through this is what happens when those people start to retire. It's like the cobalt. I still remember when all these people are freaking out, are you a cobalt programmer because if you're a cobalt programmer, you can make $1 million a year because no one's a cobalt programmer.

Absolutely, right? That talent resource is getting more and more restricted, and it's going to go away. And it's this platform that allows us to do that and retain that knowledge.

So we had you and your team like when we talked about the launch of artificial intelligence, it was actually you guys who spurred us on to reveal it all, and now was a year ago. And then since then, we've got together many, many times, we've been running pilots at one point we had 14 AI pilots running with you. So what's your view as you see this now and you see what's possible? How do you look at AI and where it can go? Because you're already doing really well, but how do you go to the next level?

Yes. So let me talk about a very specific instance with AI and some of the done. Operations also got a ton of capability, but it's really about how you impact the customer and how you impact the business. So specific incidence I'll talk about is that thing our companies all hate, that customer that calls in with an intermittent connectivity issue, right? It's just a nightmare because that customer calls in and half the time when that customer calls in, it's working talk to our...

Murphy's Law.

Absolutely. Absolutely. And then our teammates are our employees spend 15 minutes in some research project, trying to replicate what happened with the customer figure out what happened. We were actually able to put operations agent like in an actual customer experience to do that. The teammate with operations agent we were able to actually resolve or understand that customer's issue instead of 15 minutes in 30 seconds. So we knew where the service was degrading when it was degrading and get to servicing that customer faster instead of 15 minutes flipping through screens with a technician in the home or a teammate on the phone.

So then when you go through that, then it also comes down to you, then you can also look at, okay, now how do we fix this, so it doesn't happen intermittently, which is -- in other places, too.

Absolutely because that's the worst take. You end up with an intermittent issue, but there's 30 second other intermittent issues with 30 second other customers having that same experience.

All right. So you as a CEO, you're pretty AI forward, right? And over dinner, you told me a funny story. So apparently, he was a little worried about coming on stage with me because I can at times go off script. So why don't you share what you did personally with AI to kind of solve that problem.

Yes, it's a personal use case with Michael, is, he's not wrong, right? Even this version is not the same script that we went through. By the way, these questions are purely for guidance. So we're practicing and I go to Claude and I'm like, okay, this is what I've got to do. I got 4 questions. Go out and take a look at everything you've seen Mike speak of online over the last 3 years and Claude comes back and goes, basically, this has the opportunity to go off the rail. And so literally, literally, Claude tells me, if you've ever seen the show between 2 firms, don't watch it at work. But it's like be prepared for an interview like that. But what I was able to do a personal use and how the world has changed from AI. I was able to use that data, have a really quick back and forth with Claude version of Michael and get up here and have a good conversation.

Well, and it actually came out with some, oh, that's a good question, right? So I'm going to ask what I think what was the best question that Claude came up with. So look, you're back, right? And then you have all of these customers and you have incredible results, you have the NPS that you've delivered. How do you balance driving profitability and EBITDA? And can you do it with a great customer experience?

So my answer to that question was I reject the notion that those are 2 things are mutually exclusive. And I'll tie this back to why we're here on stage, why we're here on stage. When I look at where we're going as a telecom industry. It's the combination of the guy on the right and the agent on the left. And I think we are going to be able to use the technology in concert to provide better customer service and drive profitability in our business.

Well, when you think about it, if you can do what with 25 people, what others are doing with 400, right, that puts you in a unique competitive position. But then the other part too is as you deploy this AI, it's going to flow out to you quickly. It allows those 25 people to operate like their 400, right?

This is an augmented.

Yes, augmented human.

This is an augmented human. And this is the future where we're going, right?

Well, let's give Shane a big round of a plasma huge thanks. Congratulations on the success. All right. So what Shane talked about was I don't know why I'm supposed to deal with those cards. So what Shane talked about is that from an operations scenario, how they took what was 15 minutes in an intermittent scenario, which actually is the worst scenario because it was 15 minutes of recurring tell you finally solve it, and Lord knows we've all gone through that he's actually talking about how do I really drive out this operational workflows. Here's an operational workflow that's coming out in November that you will just get. So simple example, I'm looking -- it's going to be analyzing the operations, agents going to be analyzing what's going on in the network, service connections, performance thresholds and it sees an issue. It's going to diagnose it. It's going to bring it over to a human because in the end, this is about how do humans and agents work together. How do you actually bring it to someone, one of your incredibly smart network architects and say, here's the data that you need to make a great decision to reconfigure something, to make a change, maybe it's roll a truck and they click it. And at the same time that that's happening, we identify the subscriber and a decision matrix will decide, do we actually have to notify the subscribers that something is happening in the network, hey, you're not diluted, there's an issue going on. So we notify the subscribers, hey, there might be a slowdown. We're working on it. It gets fixed and up comes through the applications, the subscriber agent says, "Hey, you're fixed." And then this is the biggest part. After all that is done because we're often running around like chickens with our heads cutoff, solving problems, we don't have a lot of time to stop and say, what happened? How do I change my business? What processes do I have to change? Instead, what I can do is I can bring all of that knowledge from everything that was collected as we went through this from all the different agents as they interact with subscribers, as they look to the network as we identified what's going on and bring it together in improvements. And it's interesting. The power of what's next is an interesting conversation I had with our CIO, just before he came to Connexions, and he was talking about how one of our vendors actually gave us AI and put it on top of a bunch of our operations, in this case, on top of how we run tickets for our employees, which is not unlike what you do when you support subscribers because that's what a CIO is, they serve the business. And so he was on with his team, and they were going through all the tickets for the last month and then there was this category called unknown. And he said, "Well, what's the unknown category." And they're like, "Oh, we're not sure." It's unknown. And you said, "Well, it should show up with that answer, but that's fine." So they said, "Well, okay, we know we'll go away and we'll come back and we'll let you know what it is. He said, no. We're on -- we're looking at this data with an agent, ask the agent. Ask the agent. So they did the query the agent and it said, unknown is consists of MuleSoft integration problems and a number of other issues. So in the case, the AI was already there. It was ready to do it. In that case, what he learned, he's got a process and a people thinking process issue that he has to work through. He has to help his team understand these things are here to serve. But unless you start thinking different and basically assuming how you used to work before looking at reports, generating reports that no one looks at and get into this mindset of everything is at my fingertips to research as I go, you're not going to make the most of it. So we have this big shift ahead. Now if you see this workflow and you're like me, you're going to have the same reaction I did. My first reaction when I saw this workflow is great. but none of you are a McDonald's who have a handbook and implemented exactly how we say we do it, right? You're all different. So I'm proud to announce that we're launching Workflow Studio. And what Workforce Studio is, is the ability to customize workloads for your business. And it works like this. You have workflow Studio and it will show all of the different elements affiliated with your business. So it's going to include everything you've done that connects to A, MCP servers and then all of the agents that we have available. And what you have to think about with all the workflows that I present over the next 3 customer stories is think of them as like templates as reference guides, based upon the best practices of over 1,000 customers who help us understand what is the best operational workflow. This is the best marketing workflow, what is the best subscriber workflow. And then what you do is you say, "Well, that's not how I work." And I encourage you through this process to do this. You need to say, do I work right? Do I work right? Because how you did it before, this goes back to the B&G just because you used to do at BNG doesn't mean you should have it. You shouldn't. 5, 10 years from now, they should all be ripped out of your network because you need to think different if you want to be successful in the future. So you use this process to go through your workflow, and you then lay it all out using all the different component parts, outcomes a test campaign, you deploy the agent and off we go. And the great thing that you're going to see through 2027 with the massive amount of capacity that we are unleashing to help your business be more successful is a significant work with partners to make sure that can happen. So now let's look at what does that look like with that old workflow. Well, now what I'm going to do with regards to what's going on in the network, I'm going to augment it with GIS data, national weather service, other systems using A to A and MCP, then what I'm going to do is go through that diagnostics perhaps it requires a truck roll, and I happen to be using Salesforce or ServiceNow or NIC or whomever, Gayawhatever, pick a partner, right? I have my partners that I'm doing this work for. It actually uses agent-to-agent, sends a truck roll and the communication and then we go through it. And the great thing about these agents is that in our knowledge context, they will store all that MCP data so that they have the broader context, which includes what the partners are doing. That's the future of workflows. And so we heard you, this is all coming. I would encourage you to go to the innovation center where you can actually talk to our teams about it. But this is the future of work and all of you in the room need to rethink how you run your business. You need to rethink how you run your business because this is a great opportunity to completely change and uplift everything. And so next to stage, let's bring up Brooks Goodall to talk about service. Roll the video.

RTC network serves roughly 15,000 broadband subscribers in Western North Dakota and Eastern Montana. We are a member-owned cooperative, and we recently celebrated 75 years this past summer. Because the area that we serve is extremely remote, access to business IT services historically has been challenged. Most of our businesses and organizations do not have local personnel, often resulting in wait times of a week or more for on-site support. Our customers benefit from a simple unified approach, one call, one provider, one trusted local partner. This model has been extremely successful, allowing businesses to receive timely support from people who understand their operations and are part of the community. Our partnership with Calix is both strategic and collaborative. Calix provides more than technology. They help us deliver exceptional subscriber experiences through Calix Cloud, managed services and operational insights, we can proactively support customers network visibility and create.

All right. Let's welcome, Brooks. Welcome to stage. Hey, Brooks.

Michael.

Nice to see you again. Made a joke that Brooks has the first name of where I grew up. So Brooks, you've had some great success. Your customers are doing great. You're growing at an incredible pace, but you have some complexity in your business. One of the things we talked about was that your customers have a lot of devices and peculiarities that you need to deal with. So why don't you share how you're thinking about those?

Yes, Michael, we have around 15,000 broadband subscribers with an average of 20 to 25 connected devices in every home or business. At that scale, it's just not simply possible for humans or people to continuously monitor every network and every device. So we want to get to a place where we can identify those issues sooner and be more proactive and solve those problems before it impacts our customer experience.

Right. And so when you think about productivity and where we go with that, walk us through how you're starting to think about how do you get proactive with agents to sell those problems?

So I got a couple of examples. One example was we had a local school who had a volleyball game on a Saturday. That was going to be live streamed. The broadcast crew showed up at 6:30 for a 7:00 game. The connection was down in the gym. So the broadcast crew is scrambling, the school is scrambling. They got a hold of our support team. And luckily, in that town, we have one employee and that employee happens to be a technician, and thankfully, he's a sports fan. So he was on his way to the game when he got the call and he's able to restore the service a few minutes before the game got broadcast. The pregame was kind of cut short, but the game went on without a hitch. So...

Yes, like we talked about, you can't run a business on luck.

That was luck.

Right? So I was lucky that he was there, it's lucky that you happened to be going to that volume game, right? But that's not a way that you can be repeatable. Plus what if he wasn't going to the volleyball game and was going to someone else and he had an incident, right?

Correct. And we did get lucky not and there's a few grandparents that had no idea who were could make the game that we're very excited to watch the game and had no idea that they almost didn't get to watch the game. So that was portion of thing. But when we looked into that, Michael, that connection went down a few days earlier. And the school didn't notice it because they don't use that connection every day in the gym. And although we have visibility into that, it just wasn't at our fingertips. It just didn't jump out and say, service in the gym is done. So what the active agent, we could have got ahead of that trouble, fixed it earlier in the week, and they reduced a lot of stress.

Well, like if you think through that scenario, too, we talked about the fact that imagine if you wouldn't have been there, like what would have been the brand damage that you would have because everybody goes to the local games, whether it's a football game or a volleyball game, right?

Right. And that's about being proactive, not reactive, not waiting for the customer to call us when they have a problem. A recent study I read Michael, was 24% of broadband subscribers do not reach out to their provider if they have an or a problem. So you talk about churn or high-risk people leaving to a competitor, actually a group right there. And when you talk about competitors and competition in our small communities of World America, competition has never been stronger. Starling, T-Mobile, Verizon. Verizon, their advertising and all of our communities cheaper rates than where our current price points are. So we talked earlier about change about using AI, and it's not an option. I'm confident that our team, along with the Calix agents can beat down the competition on that.

We call them the silent sufferers, I think, right?

Yes.

So you've been starting to work with what we're doing around service and agents and those things. If you think about that, what is -- what are your goals? Because you've set some pretty clear goals with your team on what's going to happen in 2027.

So our goal is we're excited to take the next to take the Calix agents, the service agents and take them to the next level. Along with being proactive, there's also customers that call us, a lot of times the customer isn't educated on what to tell our customer support team. They don't really understand technology. So it takes a while sometimes to find out what the root of the problem is with an agent working in the background, they can identify issues sooner when we have someone on the phone. It gives our support team confidence. It gives them knowledge and then also resolves the call quicker and the trouble quicker, and that helps with first call resolution. So when we talk about first call resolution and the other efficiencies that agents can create, I mean the price of everything is going up, a fuel, for example...

The price of gas is something we all think about right now.

And so you take a talk in churn and truck rolls and you know where we area that we serve, if you got to roll a truck, you got to pack a pretty big lunch and make sure you got a full tank of fuel, right? So reducing truck rolls is very important as well. So...

You're gone for the deck.

You're gone for the day, right? So I think at the end of the day, we really are looking forward for the agents to help us be more proactive to help us be more efficient. And really, that helps us save cost and time that we can reinvest back into our community.

Well, they have a lot of devices. You talked about all the devices you dropped a managed switch that can be seen by service cloud and fully managed. And it's just another level of control that reduce trucks, right?

Correct.

Right Brooks a big round of applause. Thanks.

Thank you.

Thanks, Brooks. All right. So Brooks talked about service workflows. Here's the reference workflow that's going to be coming out in November. And we just talked about it. Hey, intermedian anomaly detected. Things are happening. I'm confused by what's going on inside the network. I identify there's a churn risk. So I'm starting to see some incremental packet losses, the customer might not know why they're unhappy, but they're unhappy. And in this case, they actually have an unmanaged switch that's been detected. And I put this one up because this is actually something that happened to me, and I worked with the product team on it because of the fact that they couldn't really see -- they couldn't see the crappy piece of device that I bought from Amazon to quote them. The challenges it was happening and apparently was causing a loop, and they didn't have that insight because of the fact that they weren't running that managed switch. So there's this great opportunity to identify and again, go back to the innovation center, and then we'll show that to you. where we can actually now drop in and manage switch as an offer and say, "Hello, Mr. Customer, Ms. Customer, we think you're having some problems." Here's what's happening and they go, "Oh, yes, that is happening, right?" Well, the reason why is because you bought something that doesn't really work very well, here's an offer, how would you like to manage switch, we'll drop it off. And because we've done a great job of helping you, thanks to the collaboration that we've gone through, self-installed, shows up the next day, they plug it in. And if they have a problem, you can see everything that's going on. Just another level of extension of controlling the home, controlling the small business, controlling the MDU, so you can be successful. And then as I said, just like with the other workflows, workflow studio is going to get the flexibility to start integrating the different technologies and different partners that you use in your service workflow. If you don't run your call center with Service Cloud, if you're using different products, using Salesforce or NIC or IR or all the different folks out there that are doing these technologies, if you need them, they'll give that to you. And then at the same time, you can also bring in different pieces of technology as you communicate with customers. Maybe what you're going to do is they have a managed switch, but you can't get a hold of them, you're trying to reach out to them when you can start buying ads and popping up on pop it up on their feeds through HubSpot or through Facebook or Instagram so that they can actually get to that purchase point. And then once again, getting to a better outcome with the customer. Because in the end, all these service opportunities at the same time represent a great opportunity for you to elevate your brand and also the seek-out sales opportunities that allow you to grow profit and get sticky I cannot say this enough. When that person is making that call, they should ask or they should be armed with the information. By the way, I noticed you have a pool, would you also like to have better WiFi by the backyard. And it was funny, I was talking to someone actually the next speaker. We were talking about barbecuing in the backyard and he's brings over to the back here at amazed by how great his WiFi is in the back yard. This represents a great opportunity that we all need. With that, let's go on to marketing. Let's bring John Walburn from Conexon out. Big round of applause and roll the video.