Financial Data and Key Metrics Changes - Second quarter revenue was $97.9 million, up 32% sequentially from $74.3 million in Q1 2025, but down 4% year over year from $102.5 million in Q2 2024 [16] - Adjusted EBITDA for Q2 was $27.6 million, compared to $6.5 million in Q1 2025 and $26.8 million in Q2 2024, with a new quarterly record adjusted EBITDA margin of 28.2% [19] - GAAP net income for Q2 was $11.6 million, while non-GAAP net income was $24.5 million, or $0.80 per share on a fully diluted basis [19] Business Line Data and Key Metrics Changes - Endpoint IC revenue for Q2 was $84.6 million, up 38% sequentially from $61.2 million in Q1 2025, but down 5% year over year from $89.4 million in Q2 2024 [16] - Systems revenue for Q2 was $13.3 million, up 2% sequentially from $13.1 million in Q1 2025 and up 1% year over year from $13.1 million in Q2 2024 [17] - Gross margin for Q2 was 60.4%, compared to 52.7% in Q1 2025 and 58.2% in Q2 2024, driven by a richer mix of M800 and licensing revenue [18] Market Data and Key Metrics Changes - The company noted strong demand in the food sector, particularly for product freshness and supply chain efficiencies, which are driving pallet and case level deployments [15] - The company is experiencing a shift in market dynamics, with logistics and food sectors showing solid growth despite slower apparel and general retail growth [33][34] Company Strategy and Development Direction - The company’s solution strategy focuses on using its platform to solve enterprise challenges, which has been central to its strong results and outlook [8] - The introduction of Gen2X is expected to be a key component of the industry's future, improving read range and inventory management [10][11] - The company aims to extend its technology lead and market share while delighting enterprise customers [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the market position and noted that enterprise customers are actively engaged in extending their RAIN deployments despite macro headwinds [14] - The company anticipates third quarter revenue between $91 million and $94 million, reflecting a quarter-over-quarter increase of 13% at the midpoint [22] - Management highlighted that both gross margin and adjusted EBITDA margin set new quarterly records, indicating progress towards long-term financial targets [20][21] Other Important Information - The company ended Q2 with cash, cash equivalents, and investments of $260.5 million, up from $232.5 million in Q1 2025 [20] - Inventory totaled $96.2 million, down $2.3 million from the prior quarter, indicating effective inventory management [20] Q&A Session Summary Question: How much of the Q2 beat was related to turns? - Management noted that there were more turns than expected in Q2, but adjustments to delivery timing and location also contributed to the results [26] Question: Can you elaborate on the margin improvements? - Management indicated that the M800 ramp and lower wafer costs are driving margin improvements, with expectations for continued benefits in Q3 [30][61] Question: What is the outlook for logistics and food sectors? - Management confirmed that there are more opportunities in logistics and emphasized the importance of supply chain resiliency across various sectors [56][57] Question: What is the status of channel inventory? - Management stated that channel inventory is healthy and expected to remain stable, despite a modest build anticipated in Q2 [49] Question: What are the expectations for food item-level deployments? - Management expressed optimism about food opportunities, particularly in bakery and proteins, but noted that significant adoption will take time [68][80]