Welcome to today's conference call hosted by Harmonic to discuss the company's recent announcements as outlined in its press release dated Monday, April 8th. My name is Jonathan, and I will be your operator for today's call. After the speaker's presentation, there will be a question-and-answer session. To ask a question, you'll need to press star one one on your telephone. If your question has been answered or you'd like to remove yourself from the queue, simply press star one one again. Please note that this conference is being recorded. With us today are Patrick Harshman, Harmonic's President and Chief Executive Officer; Nimrod Ben-Natan, Senior Vice President and General Manager of Broadband; and Walter Jankovic, Chief Financial Officer. With that, I'll turn the program over to Patrick Harshman. Patrick?
Okay, thanks, Jonathan, and welcome everyone. On today's call, we'll discuss the announcements made in our April 8th press release and then open up the call for your questions on this news. The first piece of news communicated in our April 8th press release was my planned retirement on June 11th, the date of our annual shareholder meeting, and the selection of Nimrod Ben-Natan as my successor by our board of directors. After 30 years with Harmonic and 18 years as President and CEO, I decided it was simply time for me to hand over leadership responsibility and focus on the next phase of my life. Leading Harmonic has been the privilege of a lifetime, and I'm deeply appreciative of the amazing Harmonic colleagues, customers, board members, and shareholders I've been able to work with and learn from.
Together, we've accomplished much, including strategically positioning our company as a global market leader in cloud-native broadband and live video streaming, deploying products and services that millions of consumers depend on each day, and earning the trust, respect, and partnership of many of the world's most successful telecommunications and media companies. After a thorough and nearly year-long succession planning process driven by our board of directors with the support of a leading outside search firm encompassing both internal and numerous external candidates, I'm really pleased that Nimrod has been selected as the next President and CEO of Harmonic. As a long-term Harmonic team member with a career spanning R&D, product management, and general management, Nimrod brings deep broadband and video market expertise and great customer and industry relationships to his new role. He has also demonstrated entrepreneurial success in driving the recent tremendous growth of our broadband business.
He's ideally suited to lead Harmonic and our talented global team into its next chapter of innovation and growth, a future I'm confident in and excited to see unfold. While Nimrod, Walter, and the rest of the leadership team are more than equipped to continue driving the business, it is our intention that I will stay engaged with the company beyond June in a supporting capacity wherever and whenever I can be helpful. And with that, let me turn the call over to you, Nimrod, for a few comments on the transition.
Nimrod, you may proceed.
Bear with us just a moment, Jonathan and everyone. I think we're having a little bit of a technical difficulty. Just give us a moment to get it straightened out here. Well, I'll tell you what, Jonathan and everyone, while we see if we can get Nimrod's audio part finished out, let me move the call on, and we'll try to get him on in a moment. But let me move the call on to discuss the second piece of news that was communicated in our recent press release. That is the decision of our board of directors to conclude its strategic review of our video business. Let me just pause a moment, Jonathan, and make sure that my audio is still coming across clearly. Is it?
Yes, you're coming through loud and clear. Thank you.
All right. All right. Fantastic. As previously announced last October, Harmonic's board of directors initiated a formal strategic review process to evaluate potential strategic alternatives for the company's video business. Part of the decision to initiate this process was due to inbound interest received from a couple of parties. Our board determined that it was in the best interest of our shareholders to not only seriously evaluate these inquiries but to also conduct a thorough and comprehensive process, including proactive outreach, with the assistance of independent strategic, financial, and legal advisors. Consequently, over the past six months, we've had substantive dialogues with multiple parties, both public and private, who had the potential to be a good fit for our business and technology.
After a very thorough and open process and carefully evaluating a range of alternatives, we determined that there was not currently a compelling and certain strategic alternative that would generate superior value for our shareholders. Once that determination was made, we were obligated to communicate this decision in a timely manner. As this conclusion has been reached, we're moving forward aggressively to manage our video business for optimal market success and shareholder value. Harmonic's go-forward video business strategy and 2024 execution plan is centered on driving profitable operations achieved through even tighter focus on scalable sports and live streaming opportunities, sustainable service engagements, and ongoing cost structure optimization. As part of this plan, we're taking a series of cost reduction actions and are actively realigning and refocusing our sales organization. As stated in our press release, we will continue to monitor market conditions.
Our board is always open to considering potential opportunities should they arise, provided they are consistent with our value creation objectives and determined to be within our shareholders' best interests. Lastly, I want to briefly note that, in our April 8th press release, we also provided updated Q1 2024 revenue guidance. We're still in our normal quarter-end close process and do not have any additional financial details to add at this time. We will be announcing our full first quarter results in just a few weeks on April 29th, as is our normal schedule, and we'll be prepared to provide more details and insight regarding our financial results and outlook at that time. In the meantime, I want to convey my strong confidence in our team, in our business, and in our future prospects.
Harmonic remains uniquely positioned for sustainable long-term growth, and our thoughtful succession plan will ensure uninterrupted execution focus. Okay, that concludes my prepared remarks. Let me just check one more time. It looks like we're still having some audio issues on Nimrod's side. So, why don't we bring to an end our prepared remarks? You'll certainly hear more from Nimrod, as well as me and Walter, in our earnings call in a couple of weeks. But let's now open it up to a few questions. And if we can get Nimrod back, and get our audio working as part of that, so much the better. But why don't we move now, Jonathan, to the Q&A?
Certainly. One moment for our first question. Our first question comes from the line of Simon Leopold from Raymond James. Your question, please. Simon, your line is open.
Sorry about that. Had the mute on. Hopefully you can hear me okay now. Appreciate you guys doing this call, and thanks for taking the question. I, I have two I'd like to ask. The first one, I think, is pretty simple, is that in the, the press release, you, you updated the, outlook for the first quarter but had no comments on the full year. We've received questions suggesting that that should be interpreted as rescinding the full-year guidance. If you could comment on, on what you're thinking about the full-year forecast. That's the first one. The second one I'd like to ask is regarding the, when did the, the company begin or undertake the process, and how many candidates, or what other color can you give us to basically give us a sense of how, how rigorous the process might have been? Thank you.
Okay, Simon. It's Walter. Hopefully you can hear me. I'll take the first question here with regards to the guidance that we provided in the press release, specifically for Q1. As you know, our normal course is to, you know, complete through our closed process and update investors coming up here on April 29th. And so from a guidance standpoint, we are not prepared at this point to provide full-year guidance. No one should take that as an indication one way or the other in terms of us not providing it in the press release. And so we're working through that just like we do each and every quarter, and we'll be speaking to you and looking forward to providing a complete picture on both our Q1 results as well as our full-year guidance when we speak next on April 29th.
And then I'll turn over to Patrick for the second question here.
All right. Well, look, before I take on the second question, at the risk of beating the first one to death, I want to say it's categorically a misinterpretation, a dramatic misinterpretation, to say we're in any way rescinding our full-year guidance. That is absolutely not the intent whatsoever. We had news, really unrelated to short and near-term financial results that we thought it was important for a couple of reasons to get out, and we got that out in a timely way. And as Walter said, really completely distinct from our normal cadence of finalizing our results of the current quarter and finalizing our updated view for the coming quarter and the coming quarters. Okay, now on the process itself.
As I mentioned in my remarks just a moment ago, our succession is a decision made by me. And frankly, me alone, I began the discussion with our board about a year ago. And at that time, a kind of a general succession plan which existed started to take more shape and urgency. A committee of the board was formed to begin a detailed planning. Also, as I mentioned, an outside search firm was hired and was absolutely part of the process that has been going on for many months. I think you used in your question the term rigorous. I would say this was an extremely rigorous and thorough and thoughtful process. And yeah, that takes some time.
And frankly, our board thinks that this process is among the very highest things in terms of their responsibilities to execute on. So I'm impressed and pleased, and was happy to contribute to and support the rest of the board in this nearly year-long process to come to a conclusion. And, of course, as I mentioned, the final decision has my full endorsement to support. I'm excited about Nimrod's leadership and carrying forward the strong momentum that we have in the marketplace.
Great. Thank you very much for that detail. Appreciate it.
Thank you. One moment for our next question. Our next question comes from the line of Ryan Koontz from Needham & Company. Your question, please.
Thanks for the question. Let's start off, Patrick, with thanking you for, you know, really being a great leader and leading an incredible turnaround for the company. You know, I know you're widely respected across the investment community. It's been great to know you for 20 years. So I hope the next phase for you is everything we hope it is. You're going to be amazed.
Thanks very much, Ryan. That's, that's very generous.
Thanks. And so, can you tell us a little more about the transition process here and, you know, where is Nimrod in kind of taking the reins now over the next couple of months? Anything you can share there and just how is his access? Is he planning to move to the U.S., or where will he spend time relative to, I think he's been based in Israel historically. Thank you.
Yeah. Well, well, maybe I'll start. And, I guess this is our first test to see whether we've got Nimrod's unexpected audio things. And Nimrod, if you are connected, you can jump in. But look, I, I to take a step back, I think it's important to understand that Nimrod has been successfully leading since 2012 our what is our, now our broadband business, which is the biggest part of our business, the fastest growing and very successful, in full general management capacity.
So, frankly, Nimrod comes into the full CEO role with his arms firmly around what is now the biggest, fastest growing part of our business, with I think an excellent track record of internal management, of innovation, operational execution, or really overseeing the not only the top-line growth but the bottom line, the EBITDA growth, and really fantastic customer relationships. Yes, there is a little bit more of a learning curve, or growth curve in terms of the broader part of the business. And that process has already begun. Nimrod's been very active behind the scenes with us. And of course, he's not alone. We have a world-class CFO, Walter, and frankly world-class rest of the management team.
So as I mentioned in my prepared remarks, I have every confidence in Nimrod and the broader executive team to really seamlessly carry forward the strong momentum that the business has. That being said, I'm fully engaged through our shareholder meeting in mid-June. And thereafter, I'm not moving to another company or another anything else. I've got personal things that I want to do, that's for sure. But I am fully on board to continue to support Nimrod, the executive team, and our board of directors, you know, however and wherever they want. So I really see a smooth and effective transition process, Ryan.
Great.
Nimrod, let's see if you've got anything else to add to that if you're connected. All right. No.
It's okay. He seems like a great choice. I've met him many times.
Thanks for your patience .
Yeah. He seems like a great choice, met him many times, really a great, great industry leader who, who'll snap right in. So that's, that's really great. I'm really pleased with his selection. And on Patrick, anything you can share on the video restructure and kind of how we should think about the trajectory? I mean, obviously, if you didn't get the bids you were looking for, anything you can share about parts of the business that you want to shore up just outside of general, you know, profitability?
Look, as you know, we continue to be very high on what we're doing around SaaS and particularly for live sports. That was a great grower for our last year, and we continue to see strong momentum in that part of the business. And I think it dovetails with what we all say as consumers, more and more, you know, next-generation streaming around live sports activity. So, it’s probably not quite literally true, but it's doubling down on where we see the growth and the success and the spending. And at the same time, we've taken a thorough view of where we didn't see the business we expected last year. And that's both in terms of certain broadcast product and technology segments, Ryan, as well as certain geographical segments.
Our cost reductions are really around pulling back from those areas where we're just not getting the ROI, where we see the market being slowest. So it's primarily around some legacy broadcast stuff and primarily around some geographies that are struggling a little bit more, from a macroeconomic point of view. So, putting more wood behind the arrow of those things that have been growing and being pragmatic about those areas that haven't been delivering the return for us.
Super helpful, Patrick. Best of luck to you, and, be well.
All right. All right. Thank you very much.
Can you guys hear me now?
Yes, we can hear you.
Yes, we can.
All right.
Perfect.
I really apologize for that. I, I want to comment on the earlier question on the geography. I've been working with our, customers, for many years, and geography has never been, a problem. I am in the U.S. or any other continent, almost every other month and, working virtually on, U.S. or Europe or, South America, time zones. So geography has never been an issue. Frequent traveler, I'll be wherever I needed. So, I can assure you guys that this is, not an issue at all. As far as, you know, my experience with customers, I, I think the results that we have achieved, are, proving the, kind of the execution, and we will definitely continue doing so.
Okay. Thank you. Thank you, Nimrod. Pleased to see we've got our short-term technical issues behind us. So let's move on.
Thank you. Our next question comes in line of Steven Frankel from Rosenblatt Securities. Your question, please.
Let me echo some of the earlier comments of Patrick . It's been a great time. Clearly been some challenges, but you know, you've really put the company in a great position, and I look forward to what happens from here. I'm a little jealous that you get to just sit back and do what you want to do and not have to worry about quarterly earnings anymore. But you know, in terms of the video business, you guys have tried a couple of times over the last few years to try to get this business to growth and profitability. What can you do differently today to ensure you get to profitability and stay there?
Well, I think it's a fair question, Steve. You know, we have had a couple of nonprofitable quarters. But actually, I think if you look back over the last two years, until kind of midpoint last year, we were delivering a positive EBITDA with the business. So I think we in general have a history of getting our forecasts right. I think we've seen additional turmoil and softening of the market in the last three quarters or so. And frankly, news of our process being public was also an additional headwind that was in front of us.
And frankly, a secondary reason why once we came to a conclusion, we wanted to get out in front and actively communicate the news, unlocking several opportunities that have been kind of put on ice pending resolution of our process. So, as I answered a moment ago, unlocking those opportunities, being really pragmatic about what geographies and what particularly historic product lines are simply not delivering, pulling back spending in those areas, but also building on the success that we have seen, particularly around live sports streaming, we think it's the right formula to get back to what you know, in all fairness, has been in general a history of positive EBITDA for the business and keep it there. And I can tell you we're 100% committed to that.
and that is something where there is just no daylight between the view that I, Walter and Nimrod have in terms of both the challenge and the opportunity.
Great. Thank you.
Thank you. This does conclude the question-and-answer session. I'd like to hand the program back to Patrick Harshman for any further remarks.
Okay. Well, well, that's it. I think short and sweet. Thank you all very much for joining us today. We appreciate your interest, your support. We very much look forward to speaking with you again very soon, on our Q&A earnings call, which is in just a couple of weeks, April 29th. Until then, take care. We look forward to it. Goodbye, everyone. Good day.
Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.