Financial Data and Key Metrics Changes - Net revenue for the first quarter was $94 million, down 7% year-over-year and down 9% on a constant currency basis [12] - Product revenue was $37 million, a decrease of 23% year-over-year and down 24% on a constant currency basis [12] - Service revenue was $57 million, up 7% year-over-year and up 4% on a constant currency basis [13] - Overall gross margin for the quarter was 28.3%, compared to 33.9% in the prior year [14] - Adjusted EBITDA for the quarter was a loss of $4.1 million, compared to an income of $3.1 million in the prior year [17] Business Line Data and Key Metrics Changes - Product revenue decline was attributed to slower performance in EMEA and China regions [12] - Service revenue growth was driven by a 10% increase in contract revenue year-over-year [13] - Product orders for the first quarter were approximately $40 million, with a book-to-bill ratio of 1.1 [13] Market Data and Key Metrics Changes - The company experienced a slowdown in EMEA and China, while the U.S. market showed stability [25] - The company reported gross orders of about $40 million, lower than expectations due to timing of customer receipts in the Americas and China [26] Company Strategy and Development Direction - The immediate goal is to identify key strategic, operational, and financial areas necessary for competitive positioning and margin expansion [6][8] - The transformation plan aims to enhance organizational responsiveness and agility, targeting a high single-digit adjusted EBITDA margin within 12 months [9] - The company plans to provide more details on the transformation plan in early 2026 [19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for enhancing performance and long-term growth prospects [5] - The company reiterated its fiscal year 2026 guidance with revenue expected in the range of $471 million to $485 million [18] - Management noted that geopolitical and macroeconomic uncertainties are ongoing but expressed confidence in achieving adjusted EBITDA guidance [20] Other Important Information - The company initiated a restructuring plan resulting in $2.8 million in restructuring charges [17] - The company ended the first quarter with a reporting order backlog of approximately $396 million, providing strong visibility for future revenue conversion [13] Q&A Session Summary Question: What is the current capital equipment purchasing environment? - The response indicated a varied environment by region, with a slowdown in EMEA and China but stability in the U.S. and growth in APAC [25] Question: What contributed to the difference between gross and net orders? - The response noted that age outs occurred but were not out of the norm, with lower gross orders primarily due to timing of customer receipts [26] Question: Any updates on tariff mitigation efforts? - The company is actively pursuing a duty drawback program and considering the implementation of a foreign trade zone to mitigate tariffs [27] Question: What is the expected revenue split between the first and second half of the fiscal year? - Management expects first half revenue to be about 40% of full-year guidance and second half to be about 60% [29] Question: How will product gross margins be affected in the upcoming quarters? - The response indicated that product gross margins are expected to improve in the second half as more deals in developed markets are executed [32]