00:00I do want to start off with your earnings report last week, because whenever we talk about these
00:03AI companies, the story has always been they have these big beats on revenue, yet they miss on
00:08profitability or they miss on margins. You had kind of the opposite story. You beat on margins,
00:13you beat on profitability, but you missed on revenue. And you said it was kind of just a
00:16timing issue. Explain exactly what the issue is. Yeah, absolutely. Well, there's certainly a series
00:23of very, very strong earnings and headquarters. And the second quarter was no exception in that
00:31respect. We were our EPS were up 60 percent here and here. Very strong cash. Sales were slightly
00:40down on the midpoint of our guidance, still within guidance. And we attribute that to a timing factor
00:47on some complex projects. And let's say that the complex supply chain, very much internal
00:55supply chain to really deliver part of it. But again, it was a small percent. It is certainly
01:05true that with a strong second quarter, we took the opportunity and very convincingly so and
01:11very convinced for taking up our revenues for the year and pretty much raise across the board all
01:20our financials. Well, give me a sense here. I mean, you are kind of a critical piece of the data
01:26center
01:26build out power and cooling, probably to some extent, some people would say more important than
01:32the servers themselves. You had a backlog of $15 billion at year end. You stopped providing that
01:38figure on a quarterly basis, at least publicly. Has the backlog changed in any sort of material way
01:43since then? Well, again, we decided to give backlog information only at the end of the year. And
01:53with that, all this information, we talk in terms of direction of demand of the pipeline. And we have
02:02been very vocal about the strength of our pipeline and the trajectory of that pipeline growth year
02:10on year, quarter on quarter, what we define as the velocity of the pipeline. So the speed at which
02:16opportunities turn into orders that has been that has improved further. So we are in a very in a very
02:25strong position. So we feel good about the future and certainly feel very good about our second half as
02:32we explained about two weeks ago in our news call. And you're talking about building multiple
02:37compute generations ahead. How do you make investments and infrastructure investments
02:41today when the chips are changing ever so quickly? Yeah, we we clearly invest in the technology that
02:49then will power and cool and create the infrastructure for data centers for the AI fact that is key is
02:57absolutely being very close to to those who design that the technology of the future. So very strong
03:08partnership with the Nvidia example, but also working very closely with many of the hyperscalers and a lot
03:15of the other players in the industry that gives us the opportunity to align our roadmaps technology roadmaps to
03:23the future roadmaps of silicon and IT infrastructure so that we can make available our technology for those who build
03:33the data centers, our cooling, thermal converged solutions and modular solutions so that when the new chips, the next generation,
03:44next to next generation land, because we know what the roadmaps are. Yeah, we ensure that our infrastructure is ready
03:51for those for those new generations.
03:53Well, on that roadmap, I mean, particularly when we talk about sort of the agreement with Nvidia, the idea of
03:59rearchitecting, rearchitecting, if you will, these data centers around these higher volt DCs, give me a sense here as to
04:06how much of your roadmap is dependent on basically Nvidia's roadmap for its Rubin chips. And if Nvidia's rollout slips,
04:14what does that mean for Vertiv?
04:16Well, well, we have our portfolio, we've been in the in this space for 60 years, just just to start
04:24a little bit with a with a legacy. So we have a technology to serve all the technology today, and
04:30the technology of the future. So I would say that we are not new technology sensitive, we are very much
04:37new technology ready. And we are rating our customers for the new technologies.
04:42So I'll give you an example of something that has already happening, happened or is happening, the transition from air
04:49cooling to liquid cooling. That was kind of a gradual evolution. And we were very ready for the new liquid
04:58cooling higher density technology.
05:00But that never negated the strength of the air cooling part of the market that we continue to serve. So
05:09as density continues to increase, as that type of evolution, I describe for the cooling part applies also to the
05:19power.
05:20So going from architectures like the one that like the architectures today, AC power based all the way to multiple
05:30layers of different architectures at the same time, 800 volt DC, we have the entire portfolio. So the speed at
05:37which that deployment will have that change will happen.
05:40It's something that we will accompany enable, but not something that should change. We don't believe it will change, but
05:47should it change that will impact in any way.
05:52I will be very active.
Comments