Presto Automation (US:PRST)2023-10-13 09:56Financial Data and Key Metrics Changes - For the fiscal fourth quarter of 2023, operating expenses (OpEx) increased to $13.7 million from $9.6 million in the same quarter of 2022, primarily due to costs associated with being a newly public company [5][6] - Full-year 2023 OpEx was $56.9 million, compared to $33.8 million in full-year 2022 [5] - Adjusted EBITDA for the fiscal fourth quarter of 2023 was a loss of $9.1 million, an improvement from a loss of $10.8 million in the same quarter of 2022 [8] - Full-year 2023 adjusted EBITDA was a loss of $39.1 million, compared to a loss of $27.9 million in full-year 2022 [8] - Full-year 2023 revenue was $26.1 million, down 14.1% from $30.4 million in full-year 2022 [64] Business Line Data and Key Metrics Changes - Transaction revenue for the fiscal fourth quarter increased by 23.4% to $3.2 million, attributed to a successful increase in pricing for gaming fees [63] - Presto Voice has been rolled out to 373 locations, with an additional 95 under contract for installation [48] - Presto Touch has installed over 277,000 tablets at major casual dining restaurants [55] Market Data and Key Metrics Changes - The restaurant technology market is evolving, with 58% of U.S. restaurant operators indicating they will use technology-enabled solutions to improve efficiency and revenue growth [43] - The upcoming California law enforcing a $20 minimum wage for fast food workers is expected to increase operational costs for restaurants, potentially benefiting Presto's solutions [22][40] Company Strategy and Development Direction - The company aims to scale up the Presto Voice business sustainably while engaging with leading restaurant brands and delivering shareholder value [36] - Focus on reducing operating expenses and cash burn through streamlining operations and enhancing efficiencies across various functions [37][15] - The company is committed to developing its technology solutions to address the challenges faced by restaurant operators, particularly in a high inflation environment [39] Management's Comments on Operating Environment and Future Outlook - Management highlighted the significant opportunity in the restaurant technology sector, particularly in addressing labor cost pressures and improving operational efficiencies [38] - The company is optimistic about the future growth of Presto Voice, expecting it to contribute a larger proportion of revenue as the QSR drive-thru market expands [51] Other Important Information - Cleveland Avenue, a major shareholder, has committed to increasing its ownership with a $3 million investment [58] - The company has revised its credit agreement with Metropolitan Partners Group, increasing the size of its facility by $3 million [59] - Nathan Cook has joined as interim CFO, bringing expertise critical for the company's growth phase [60] Q&A Session Summary Question: Can you elaborate on your outlook for potential restaurant additions and the shift toward automation? - Management indicated a strong pipeline for Presto Voice, with several brands piloting or signing agreements, and is actively seeking renewals for Presto Touch [10] Question: What margin enhancement can restaurants expect from implementing your AI product? - The AI product is expected to provide labor savings and improve upsell acceptance rates, enhancing overall profitability for restaurants [13][14] Question: What are the catalysts to realize the $70 million pipeline in the Voice business? - The pipeline represents expected revenue from franchisees that have signed agreements, with various steps needed for full rollout [19][20] Question: How consistent has the pricing for voice AI technology been? - Pricing has remained consistent, but the market is still developing, with varying needs based on operational hours [21] Question: What unique technology needs do QSRs have compared to standard call centers? - QSRs require high accuracy and speed in order processing, with expectations for performance being significantly higher than in other sectors [24]