Hello, and welcome to the Array Technologies Second Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to turn the call over to Cody Mueller, Investor Relations, Array. Please go ahead.

Good evening. And thank you for joining us on today's conference call to discuss Array Technologies second quarter 2022 results. Slides for today's presentation are available on the Investor Relations section of our website, arraytechinc.com. During this conference call, management will make forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements, if any of our key assumptions are incorrect. We identify the principal risks and uncertainties that may affect our performance in our reports and filings with the Securities and Exchange Commission, which can also be found on our Investor Relations website. We do not undertake any duty to update any forward-looking statements. Today's presentation also includes references to non-GAAP financial measures. You should refer to the information contained in the company's second quarter press release for definitional information and reconciliations of historical non-GAAP measures to the comparable GAAP financial measures. With that, let me turn the call over to Kevin Hostetler, Array Technologies' CEO.

Thanks, Cody, and good evening, everyone. Thank you for joining us on today's call. In addition to Cody, I'm also joined by Nipul Patel, our Chief Financial Officer. Let's begin with slide 4, where I'll provide some highlights of our second quarter. This was a strong quarter for Array. We delivered on our revenue, adjusted EBITDA and adjusted EPS expectations, while having a strong quarter of bookings despite the impacts of the AD/CVD investigation, and we tightly managed working capital to ensure that we did not require additional financing or covenant relief. Revenue for the quarter of $425 million represents a 116% improvement year-over-year. Included in this number is legacy Array revenue of $352 million, representing organic year-over-year growth of 79%. More impressive, this growth was achieved against the challenging set of industry circumstances, with numerous projects starts and stops module changes and delays. Our ability to achieve this operating performance is a strong reminder of three key elements of our business model. One, we offer a differentiated, patent-protected product that provides our customers with the lowest levelized cost of energy. Two, with continued redesigns due to issues with module availability, our flexible mounting structure and civil engineering expertise are key competitive advantages. And three, our large and well-established US supply base, coupled with our asset-light operating model allows for the shortest and most reliable lead times in our industry. This provides our customers, the confidence in our ability to deliver the right products and services for their projects on time. Despite the strong delivery volume for the quarter, and the slowdown in orders due to the AD/CVD investigation in April and May, we added over $200 million in new orders, ending the quarter with a $1.9 billion order book. It is important to note that in July, after the…

Thanks, Kevin. I'm glad to speak with you all today. First, turning to slide 8, I'll walk through our results for the quarter. Revenues for the second quarter increased 116% to $424.9 million compared to $196.5 million for the prior year period. The $425 million in revenue reflects $352 million from the legacy Array business and $73 million from the STI business. As Kevin mentioned, the $352 million from the legacy Array business represents organic growth of 79%, compared to the prior year and quarter-over-quarter growth of $101 million, which is partially due to our normal seasonality where we would expect more deliveries in the second and third quarters. The $73 million from the STI business represents growth of $23 million or 46% from the first quarter. Taken together, revenue exceeded our expectations, as we had strong delivery execution and linearity throughout the quarter and had favorable timing of project start date late in the quarter. Gross profit increased to $47.4 million from $20.5 million in the prior year period due to the increase in volume, coupled with better pass-through pricing on the projects signed under our new business process. Gross margin increased from 10.4% to 11.1%. Gross margin for the legacy array business was 11% and represents the third consecutive quarter of margin improvement, as it was up 250 basis points from the first quarter and was in line with our expectations. The STI business had gross margin of 11.7% in the quarter, which was lower than expected as they continue to have construction and logistics cost challenges, not only in their U.S. construction projects, but also in Spain. Supply plan changes and longer shipping times are delaying materials to project sites, which is negatively impacting our labor utilization and productivity. However, as Kevin mentioned, we have all hands…

Thank you, Nipul. I'd like to wrap up by thanking our employees, providing me with such a warm welcome to Array. I'm incredibly excited about the trajectory of our business. We are growing our market share, improving our margins and becoming more efficient with our working capital. We are not at the finish line yet, and there are certainly areas that we are working on to improve. But I am proud of the team for delivering on a great quarter. And with that, operator, please open the line for questions.

Thank you. At this time, we will be conducting a question-and-answer session. [Operator Instructions] Our first question is from Brian Lee of Goldman Sachs. Please go ahead.

Hi, guys. Good afternoon. Thanks for taking the questions. Kudos on the solid execution here. I know the business environment is still quite challenging. Maybe a couple of questions really just on the margins. First, Kevin, I appreciate all the sort of action plan items around STI and integrating that. Can you give us a sense for how many quarters do you think it will take to sort of implement these -- the strategy? And then as you see STI normalize in terms of margins, I know you took it down from the high teens to mid-teens in gross margin this year, it sounds like just based on the euro, like what is the new normal there? What are you kind of aspiring to get to for STI gross margins and sort of over what time frame? And then I had a follow-up. A – Kevin Hostetler: Okay. Great question. I think from our perspective, we're looking at this as another two to three quarters of work, and there's work in several areas. The first, obviously, we talked about scaling down some of the construction business that -- that's becoming more difficult to be profitable and is somewhat dilutive to kind of the core product margins. So we're working very aggressively on that. I think we're really far along in Brazil. Spain is going to take us a little bit longer to evaluate and it will be more like a transition into more construction advisory services rather than actually performing the work ourselves. So that's ongoing. And while we've been really effective, the team in STI Brazil is scaling that down very quickly. It's going to take us a little bit longer, a few quarters to achieve that in Spain. I think the second key area of focus is certainly about supply chain leverage. We're working really, really aggressively with the team in both Brazil and Spain and bringing our supply chain expertise, our commodity management teams and logistics to bear on those businesses. We have a pretty aggressive sprint for that, frankly. We're in a 14-week very aggressive integration program in which through that time period, we'll be very aggressively working with them to improve their overall cost position. We're not going to be done in 14 weeks, let me be clear, but there's certainly a focused effort and push with support of a third-party and enable to do that over the next 14 weeks. So I think the right answer is, it's going to take two or three quarters to get STI margins to where we think we really want them to be kind of a terminal margin perspective, but you'll start to see that improvement here in the back half of the year for sure.

Okay. Fair enough. That makes sense. And then with respect to that improvement in the back half, I think you guys had talked about previously kind of getting to high teens, maybe even 20% plus gross margins exiting this year. Is that still intact? And then as I think about next year 2023, steel costs have come in quite significantly. Can you kind of give us a sense of what that means for you in terms of pricing strategy heading into 2023? And then on the margins, does this translate into maybe potential further margin upside for you guys as you take advantage of lower steel costs on what I would presume at this point or sort of second half 2023 project quotes and deployments. Thank you, guys. A – Kevin Hostetler: Yes. So -- two questions there. The first is -- we still stand by our high teens, low 20s exit rate on margins and we certainly do. We feel really good about that. We see that trajectory. I don't think anything is changing our assumptions in that with what we see in the next six months or so. I think the second question is really about one of the changes in our business model, as you remember that we put in place last year to protect us on the upside of rising commodity costs, also don't mean that we necessarily take huge chunks of profit improvement when commodities go down. It's really about managing that cycle of commodities and quoting at the time that we take that order. So don't expect that that steel comes down. Our margins are going to just balloon up. That's really not the way the industry is pricing at this point.

Our next question is from Philip Shen of ROTH Capital. Please go ahead.

Hey, guys. Thanks for taking my questions. First one is on the IRA. And in terms of the $0.016 per watt manufacturing tax credit benefit, Kevin, I think you quantified. I was wondering, if you could talk through how much of that you think you might be able to secure? And I know this is fluid and technically, I think the torque tube producer, seller manufacturer gets that credit. But ultimately, how does that play out? Do you think you could get half of that or more? And I know, it starts effective, the first of next year. And so how would you expect that to kind of flow through margins and so forth?

Well, I think it's really going to be too early to tell. In the past, when these have come, there's been some level of sharing between the manufacturer and the end users. The end users will have an expectation, knowing that the manufacturer is getting that level of credit for some level of sharing that in the price. But I think it's too early to tell, what that looks like. I think – the important thing to remember is that, while others are scrambling out there to identify and develop a reliable US supply base. We've had a long-standing and tested US supply base that is really ready made for these provisions. So I think we feel, we're sitting in a very, very good position as these provisions come into play, because we've been at this for a long time in the US using US. So it's not only about where the torque tube is formed, right? So it's not whether you run out and put a bunch of rolling mills in place in the US, it actually goes down to the raw steel and where your source of supply for the raw steel is. And that's something that we've really focused on very aggressively over the last several years in building out a US supply base. So we're well positioned, but I think it's too early to tell how that will play out in market.

Right. Because the $0.016 would accrue in the value chain, but then with your US steel content, you can then enable that 10% ITC adder on the back end or down for the strength, if that makes sense?

Yes.

Okay. Good. Anything else you want to add on that topic?

No, I think it's just a bit early. We're still figuring out, I think everyone is figuring out. While these provisions are put into law, the actual execution, clarifications and details of them still have yet to be worked out. I can only say that, I think that we're in a great position and have a seat at the table working with several of the larger industry bodies, we certainly spend time with SIA, and we have representatives on the Board of SIA, who will have a seat at the table in terms of helping the government work through some of the details in the language that's going to come further as these provisions get more clarity wrapped around. So I think, we'll have a good representation. We'll have a better understanding earlier than others, but that's still to come.

Great. Thanks, Kevin. My second question here is on working capital. I think on the Q1 call, you guys highlighted that you expected to collect on AR in Q2. But the receivables really kind of continued to increase. So can you talk to us about what happened there? And then importantly, how much might you be able to collect in Q3 and some additional color on that overall would be fantastic? Thanks.

Yes. Hey, Phil, this is Nipul. So yes, we did state that our receivables were income. However, we did have a large revenue order larger than originally expected for Q2 of the receivables did that go. But we did -- we did have a lot of receivables in the collection process, and we still expect a strong Q3 and the balance of the year. So we -- although, it's higher than we expected, the higher revenue has helped our overall conversion cycle. We believe we're going to get the overall cash conversion cycle down into historical levels near the end of the year.

Okay. Thanks very much. I’ll pass it on.

Thanks, Philip.

Our next question is from Colin Rusch of Oppenheimer & Co. Please go ahead.

Thanks so much guys. I'm curious about the product evolution in the European market. And as you've started to make some progress there, what you're seeing in terms of product fit and which platform is tending to sell a little bit better, whether it was the traditional US business or the one coming out of Brazil?

That's a great question, Colin. I think what you see is that one of the key reasons we acquired the STI business was to have a dual position strategy. And as we all, we all know Europe is not kind of monolithic, right? Where you have coastal areas, you need one product. Where you have inland areas with low wind, you may need another. When you're in the northern part of Europe, where you've got snow and forsty, all of the above, you need another. So the key in us buying STI was to give us a dual position strategy with two different price points, but similar margin levels to be able to attack all those different regions that you need. And as we're actively in real-time, completing our go-to-market strategy globally, we're looking at being able to sell both throughout Europe. And we have a lot of large multinational customers wanting access to both product lines, depending upon the specific geography of where this particular utility scale plant is going to go. So there's not one answer. I think we benefit by having both answers and are able to satisfy their needs of two different price points, depending upon the geography, weather conditions, wind conditions for their specific locations. But there's not because that's emerging as kind of a more desired, if you will, it really comes down to the specific geography and the conditions of that individual market.

Excellent. And then this is maybe just a silly question, but just from a supply chain diversity and resiliency perspective, can you talk a little bit about any additional sources of materials that you guys are looking at? Is it even necessary at this point, but curious if there's something to do there in terms of driving some cost out and driving a little bit of competition into the supply chain?

Yes. I think when you think about the opportunities in supply chain, there is much about logistics. So you're hard pressed to have a competitive advantage when your largest commodities are steel and aluminum to say that you're buying that commodity at a dramatically improved rate than your competitors, probably isn't really sustainable longer-term. So it's really about being able to convert that commodity and then logistically get it to site in the cheapest way possible for your customers. It's a huge portion of the cost. It's on the logistics side. So what we've been more focused on is not worrying about the source of supply of our steel tube, for example. We know we have several US suppliers of that. We can also bring in from Asia if it's a large enough scale project that warrants that. It really comes down to geographically adding those suppliers, so that the distance between those suppliers and where the largest sites are now being built is smaller. So, again, your overall landing cost is cheaper, but it's less about that individual commodity if you think of it that way.

Perfect. Thanks so much guys.

Our next question is from Maheep Mandloi of Credit Suisse. Please go ahead.

Hey good evening and thanks for taking the questions and congratulations, strong quarter here. Most of questions was somewhat answered in your slide deck, but maybe just a question on international mix. What's just the growth on the international projects next year? Could you just probably throw some light around that? And is it just mostly going to be Brazil or you have like a mix of Europe or Brazil for 2023?

Yes. Hey, Maheep it's Nipul. So, yes, we still feel that we're going to be about a 75-25 mix from a US domestic to international. And similar to what we've said in the past, the international mix is going to be primarily Brazil, leading that way and then Spain and Western Europe being a majority of the rest. But you have to keep in mind that mix may vary because the US continues to be strong and in our forecast, we see in the US continue to have growth in 2023 and beyond.

Got you. That's helpful. And maybe just like one housekeeping. I know you kind of alluded a little bit on the working capital question, deferred revenues increase were higher in Q2. What is that related to? And should we expect something similar in the second half year?

Yes. So, that's related to our LOI process that we described that we instituted about a year ago from now. And we'll continue to see stronger deferred revenues just as customers continue to secure their projects earlier. And as you recall, with our new process, they secure that with an advanced payment, which would go into deferred revenue.

Got you. And then maybe just a follow-up on that. Now, that given the more constraints or limitations around the IRA and what projects your customers can get. Does that accelerate this deferred revenue or the share of down payments on the purchase orders here?

So, as we've said before, obviously, having supply is a really good resource in the commodity that we have. So, as we continue to grow and we continue to have a greater amount of supply, we absolutely believe that's going to allow us to secure four projects earlier, thus impacting our deferred revenue positively.

Got you. Thanks for taking the questions.

Our next question is from Donovan Schafer of Northland Capital Markets. Please go ahead.

Hey guys. Yes, congratulations on the quarter. The revenue was great, very cool to see, and the story seems to kind of be unfolding the way you guys signaled as far back as over a year, I suppose, the initial steel price situation. Talking about steel, torque tubes and all that stuff, I know Nextracker has -- had two announcements kind of setting up supply lines -- setting up manufacturing lines with torque tubes in US domestic sourcing, kind of supports the idea that, that was a really good move for you guys. But I guess that also raises the question if that can create -- can make it sort of a crowded space. I mean, I don't know how much flexibility there is among US domestic steel production to just pivot and make a lot more torque tubes. You guys also have the octagonal cross-section that's unique to your torque tubes. So I'm just curious, the game change and other US track or manufacturers that with the inflation Reduction Act are likely to be trying to source more of that from the US, is there just anything to be mindful of from -- as that gets congested, for instance, say, with the new core agreement you already have. So does the new core agreement you have, does that allow for taking up volumes there with some kind of firm commitment? Any color there would be great.

Yes. I mean I think what you're seeing is that, in the competitive landscape, they're recognizing one of the stronger competitive advantages that we've had for a long time, and that's our ability to deliver more expeditiously than the competitors because of our local and supply closer to the sites that we're working on. So at the end of the day, we feel that we're in really great shape in terms of overall volume. In some of the prepared remarks I mentioned that one of the things we do is we try to build capacity well ahead of where we need it. And certainly, as of today, with the vast improvements we've been making in supply chain, the additional vendors we've been qualifying and bringing on board -- as of today, our current capacity that we measure and talk about as a senior leadership team monthly on a global basis is already over 30 gigawatts, and that really is over 25 gigawatt supply in the domestic market. So that's a committed ready available volume. By the end of Q1 next year, with the current supply base that we're bringing on, the commitment from the supply chain organizations that will be at 40 gigawatts. So again, we're staying well ahead of the demand, and we're building that. And those aren't just kind of soft agreements. Those are where we have some really hard commitments in support of our volumes with our vendor.

Okay. We feel really for -- it's not the kind of thing where you get bumped if it gets competitive or people are finding it?

No.

Yes. Okay. Well Okay. Well…

You do have many of the steel converters are still manufacturing companies fully recognizing that solar is going to be a hyper growth market that happens to use a lot of high-quality steel. And as such, we have lots knocking on our doors as the leading provider in the US begging for our business. So kind of the offset is happening. We're actually getting where it's become very competitive to get our business in those implies because frankly, they see is a hypergrowth space going forward that uses a lot of their product in a high-quality version. So we feel pretty good about our position.

Okay. That's very helpful. Okay. And then Pivoting to STI Norland, so I should not realize that STI Norland was also self-performing installations in Brazil and Spain. I had always -- I just kind of took for granted because my understanding of how different types of trackers and designs and stuff, how they play in different geographies that there was sort of a historic need for some of the non-US tracker manufacturers to self-perform in the US because of the high labor costs, right? They couldn't get buy-in, couldn't get the EPCs to believe that it could be installed fast enough so they had to hire their own people and kind of try and prove it either successfully or unsuccessfully. So -- but I don't think of Brazil or Spain is high labor cost to market. So I guess I was surprised to realize that you were doing -- that you're self-performing there. Was that the case historically, when the acquisition was made, some pretty -- I think the gross margins might have been cited as something on the order of 30% to 40%. What was that -- were those really attractive historical margins at STI Norland, was that was them doing all of this kind of self-performance work in Spain and Brazil?

Yes. And –

Okay. And…

Go ahead. Sorry, what was your question?

Well, I'll let you finish. I just have a real quick follow-up.

Sure. So when you think about the construction that was going on in Spain and Brazil, and first, as, I think it was my first 10 days here. We had kind of a come together meeting because we saw that the construction business needed to be adapted a little bit better. And when you think about us being an engineering and construction company ourselves in terms of developing those products, we're thinking about much more engineering and construction advisory services that's been actually performing the construction itself. So when you think about Brazil, if you go back to the beginning of 2021, for example, we had within the STI business, as many as -- I think it was just over 600 employees performing construction services, right? So that is a massive amount of your workforce doing construction services. We have no competitive advantage in the actual hiring of labor. And this isn't where we had our own construction crews that we would move around the country of Brazil. This was all about, "Hey, we're going to start a site on the East Coast and the Southern belt of Brazil". So we're going to go hire lots of local labor to perform on that site. So we would set up shop, hire people, qualified people, manage them throughout the construction process. We teach them how to build and then once the site is done, they're gone, and we move on to another site to do that work. And what we found was that the problems in the construction and the management of that particular labor pool was taking a disproportionate amount of our managers' time away from customers away from focusing on the business. You can imagine, you had the safety challenges. You had weather challenges, productivity, utilization, all of the above, that was really hard to run a predictive P&L when you have those kind of challenges running the construction business. So three months ago, we start as a leadership team and said, let's start scaling that down and pivot those resources into what we call the CAS or Construction Advisory Services group. So we took our best fields -- the best people we had in the field that run those sites and they're going in a sign. So rather than have 50 individual amount of particular site, we'll have two or three of the senior construction advisers that will go and they will source local labor, meaning that the EPC will, and we'll provide them a couple of bodies to help educate, training, oversee the

Best practices

But not just the…

Yeah. Okay. Well, so from that standpoint, just will there be -- if you do get rid of these workforces, will there be any sort of meaningful severance amounts or higher expenses costs sort of associated with that…

We've been scaling them down in Brazil as projects close because they're only hired on these short-term pieces. So for example, I think when I made in my prepared comments, we're running down to half, we're all the way down to as of the last few weeks when I was in Brazil and checking on the progress of scale down, we're down to maybe 120 individuals. We'll stop when we get down to about 20. That will be our best kind of format and they [indiscernible] construction advisory services group. Now, I want to be clear, it's going to take a little bit longer for us to do that work in Spain. Spain has much more of an entrenched expectation of construction services. So we have to work with our customers in Spain and guide them through the process of, hey, look, we're not going to leave you stranded. We're going to continue to be on site to help you construct, but we're going to let the EPC actually hire that labor, manage that labor. And it just leads us to a much more predictable set of results as we go forward.

Okay. That's great. Thank you. I'll take the rest offline.

Welcome.

[Operator Instructions] Our next question is from Joseph Osha of Guggenheim. Please go ahead.

Hi. Good afternoon. I've got two questions for you. First, during the prepared comments, I believe I heard something about the retention of cash for future strategic acquisitions. I was just wondering what type of moves we might be expecting from you all in the future.

I got it. I'm not a rocky enough to foreshadow that, right? Look, the inorganic growth part of our business is going to be an important part of our model as we go forward. When we look around the near adjacent product to what we do, I think there are several areas that we would look at. We would look at different technology plays that increased the share of our customers' wallet in this space. I think there's some -- something to be said for buying our way into some additional geographic expansion in particular regions that we think going forward will be hyper growth regions for solar. And that's really the focus. So we're active in looking at these different opportunities at this point. But I want to be really clear, in the near term our team is focused on building that muscle of integration, right? We've taken a big bite with STI. We've gone out hired a third party to assist us and teach us how to effectively integrate a large acquisition and not saying that the future ones are going to be large by the way. But it's certainly something that we have to develop and how do we transfer all those core processes over a very rapid time period. So our focus here in the near term in the next six months is going to be to focus on integrating fully the STI and getting its business model to where we'd like it to be. While we're actively doing that, the subset of us will continue to look at these adjacencies and prioritize the geographics and the adjacencies that we want to play with us. It's too early to say they're kind of specific types and where they are at this point.

All right. I understand. Obviously, you can't tip your hand, but that was a helpful answer. Thank you. And then a completely underweighted question for Nipul. Looking at that Q3 free cash flow number you're talking about, which is quite impressive. And just thinking about that a little more holistically, how much of that, especially as we may be thinking to Q4 comes from the sort of one-time goodness as the working capital accounts go back the other way? And how much of it might we think of as real kind of sustainable recurring free cash flow.

So a portion of that is the -- basically the flipping of the buildup of inventory and delivering those products and the collection of those receivables. But -- our business, if you step back our business, it’s truly a free cash flow generation business. As margins continue to go up in the subsequent quarters that drives free cash flow, along with just more working capital efficiency. Kevin talked about what we're doing on the receivables side. We're well-connected with our front-end sales side to ensure that our receivables that are in the collection process get collected on time very quickly. So I would say that, of course, you're going to have that just normal transition of the receivables that build after Q2 being collected in Q3, but we're normally a free cash flow generating business and feel that once our margins are back at the historical levels, we'll continue to generate free cash flow.

Okay. Would you care to put a number on that? I mean, I used to cover industrials and people are always talking about free cash flow and net income is there some kind of aspirational free cash flow number that you might want to share with us?

So what I can share with you new, obviously, as we progressed on this journey, we'll get -- we'll provide further detail. But for the balance of this year, we still believe we're going to be free cash flow positive in the tune of around $100 million for the full year. So that obviously means we're going to be looking from the negative free cash flow position we're in the first half of the year pretty significantly here in the back half.

Okay. Thanks very much.

Our next question is from Kashy Harrison of Piper Sandler. Please go ahead.

Good afternoon, everyone and thank you for taking my questions. So maybe just following up on Joe's last question, just maybe wanted to give it another shot. Like you said, you are -- your EBITDA margins are going to be better next year. Working capital management is improving, attaining historical cash conversion cycles, et cetera. So maybe moving forward, how are you thinking about, say, either an EBITDA to free cash flow conversion, or maybe how do you think about just the ongoing working capital requirements of this business moving forward?

What we look at, Kashy is really our cash conversion cycle and trying to target overall cash conversion cycle in the low 70s, which we've historically done. And when we've done that, we've generated significant free cash flow to fund our business both internal ROI projects as well as funding for acquisitions. So we will continue focus on elements of the cash conversion cycle, but really getting back to that around 70 -- in the 70s for that overall CCC.

That's super helpful. Thank you. And then for my next question, in the prepared remarks and in the press release, you indicated that the business organically grew by 79% year-over-year. I was wondering if you could just help us think through how much of that might be driven by higher steel prices and just inflation and how much of that is driven by units?

Yes. So when we look at ASPs, we see about a 20% growth year-on-year on ASP. So the remaining increase there on the organic side is really related to volume and project mix, but about 20% on the ASP side.

That's super helpful. And then just maybe my final one. Obviously, a lot of detailed discussion surrounding FTI. If you just maybe think about FTI at a higher level, with all the changes that are going into play, how are you thinking about the growth potential for this business? It sounds like this year is maybe a reset year or flattish year. But longer term, how do you think about the growth for FTI?

Yes. So FTI, we believe we're positioned well in the regions that we're currently at. So, if you think about Brazil, in the top player in Brazil with the majority of the share of demand, we see the growth in Brazil over the next several years and we're in a great position to capture a lot of that growth. In Spain, as we continue to grow our business as Kevin mentioned, with self-performing less of our business and being more of delivery of the products, the engineering products. We continue to believe that will be the top three in Spain. So, if you look at those two regions, we'll grow with the market or better in both of those and having good positions in the market. So – we don't have an exact growth percentage right now, but we will grow with market and above market in those two regions primarily.

Helpful. Thank you.

Our next question is from William Grippin of UBS. Please go ahead.

Great. Thanks very much. Just one quick one for me. But wondering if you could provide any color on kind of the revenue cadence here for the second half of the year. It looks like relative to the second quarter guidance kind of implies flat to potentially lower revenue for third quarter and fourth quarter. So just curious if you could provide any color there? Thanks.

Yes, sure, Well so for Q3, I would say we're going to be about the same as Q2. So, stay flat to Q3. In Q4, we're seasonally down in Q4, with most of our business being in North America. So, we'll continue to see that to get to the full year guidance range that we've stated.

Very helpful. Thank you.

Ladies and gentlemen, we have reached the end of the question-and-answer session. And with that, this concludes today's conference. Thank you for joining us. You may now disconnect your lines.