Calix Stock

Calix, Inc. and its subsidiaries (Calix) develop, market and sell the company's platform (cloud, software and systems) and managed services that enable service providers of all types and sizes to innovate and transform their businesses.

For the company's customers to successfully transform their businesses into the innovative broadband service providers, or BSPs, of the future, they require actionable data for critical business functions such as network operations, customer support and marketing. However, this data is often trapped in disparate systems or departmental silos. The company's platform, which includes Calix Cloud, Revenue EDGE and Intelligent Access EDGE, gathers, analyzes and applies machine learning to deliver real-time insights seamlessly to each key business function. The company's customers utilize these data and insights to simplify network operations, marketing and customer support and deliver a growing portfolio of SmartLife managed services and experiences that excite their subscribers. This enables BSPs to grow their brand through increased subscriber acquisition, loyalty and revenue and to reduce their operating costs, creating value for their businesses and the communities they serve.

The company's platform offers a competitive edge to BSPs at a critical time of increasing competition from direct-to-consumer cloud companies and device providers as they expand their reach and focus on owning the connected home experience. The company's platform enables BSPs to build next generation networks and offer higher-value managed service offerings that enable them to grow revenue, increase subscriber loyalty and monetize their network investments.

The company's Intelligent Access EDGE network solution and Revenue EDGE subscriber solution are designed to allow BSPs to simplify their businesses, while launching exciting new services in a matter of days and weeks instead of months and years. The company's role-based cloud enables BSP teams, such as marketing, operations or customer support, to leverage real-time behavioral analytics to anticipate the subscriber's needs, whether they are in the home, roaming across the town or managing a small business. The company's platform is built to enable BSPs to quickly and easily deploy a growing portfolio of SmartLife managed services to connect entire communities. This enables BSPs to establish themselves as essential technology innovators that are enabling their communities to grow and thrive.

To expand the company's reach in the market, the company will continue to pursue strategic technology and distribution relationships that align with BSPs' strategic priorities. At the same time, the company offers its Calix Customer Success and Support Services along with a growing portfolio of award-winning market activation resources that provide the BSPs with best practices and programs to strengthen and grow their brand with their subscribers, thereby increasing subscriber loyalty and opportunities to grow their subscriber base.

Strategy

The company's strategy is to position Calix as the key partner providing a broadband delivery platform (cloud, software and systems) and managed services to enable and facilitate the transformation of BSP networks and the residential and small business network experience in order to excite all of their subscribers.

The principal elements of the company's strategy include starting with the data; building and evolving the company's platform; engaging directly with BSP customers; expanding customer footprint across the company's total addressable opportunity; extending portfolio of Calix services; and pursuing strategic relationships. In addition, the company is expanding its relationships with organizations that help the company's customers plan and execute in-market. Examples of these partners are Conexon Connect, LLC, ePlus Technology, inc. and The Pivot Group, LLC.

The company sells to BSPs, including U.S.-based IOCs, which rely significantly upon interstate and intrastate access charges and federal and state subsidies in the form of grants and other funding, such as the Federal Communications Commission's, or FCC's, Rural Digital Opportunity Fund, the CARES Act, Enhanced Alternative Connect America Cost Model, or the American Rescue Plan Act.

Products

The company's product strategy centers on increasing the market adoption of two fundamental components:

The company's Calix Platform, which consists of:

Calix Cloud, which comes in three role-base editions: Calix Engagement Cloud (formerly Calix Marketing Cloud), Calix Service Cloud (formerly Calix Support Cloud) and Calix Operations Cloud.

Calix Intelligent Access EDGE, access network solution for automated, intelligent next generation networks.

Calix Revenue EDGE, the company's premises solution for subscriber managed services.

The company's SmartLife managed services offerings, which consist of:

SmartHome managed services and applications to enhance, operate and secure the connected experience of subscribers in their home, including managed Wi-Fi, advanced content control, network security, connected cameras, social media monitoring for kids and device protection programs.

SmartTown managed services that reimagine community Wi-Fi as a ubiquitous, secure and managed experience across a BSP's footprint by making their town a SmartTown. By leveraging residential and small business Wi-Fi systems combined with strategically deployed outdoor Wi-Fi access points, BSPs can serve subscribers, schools, municipalities, organizations, planned communities and more. These opportunities open new markets and relationships with the public sector to reduce reliance on and protect against 5G LTE fixed wireless access.

SmartBiz managed services that address the business networking and productivity needs of small business owners with an all-in-one managed service that increases staff productivity, secures critical business systems and enhances customer loyalty.

Each managed subscriber service is complemented by real-time subscriber insights via Calix Engagement Cloud, Calix Service Cloud and Calix Operations Cloud offerings, which are configurable to display role-based insights for BSP general management, marketing, support, operations and engineering staff. These insights enable BSPs to anticipate and target new revenue-generating services and applications through the company's mobile application, CommandIQ for residents and CommandWorx for businesses. The company's Calix Cloud enables simple integrations with other market-leading workflow solutions for marketing (including Facebook, Mailchimp, Constant Contact and HubSpot), support ticketing solutions and operations support systems and business support systems.

The SmartLife managed services are built on the Calix Platform and fully integrated with the company's GigaSpire and GigaPro family of Wi-Fi systems to be ready for deployment as a complete subscriber experience solution for a BSP's residential subscribers, small business subscribers and community networks. Calix customers are evolving their go-to-market strategies to go beyond marketing broadband speed. Increasingly, they are becoming 'experience' providers by delivering valuable managed services built on top of their Wi-Fi offerings. This unique portfolio gives BSPs more opportunities to provide differentiated services to their subscribers and grow their revenue.

The company's access network solutions redefine the access edge of the network by simplifying its architecture and operations. The Calix Platform's access network component is implemented in the company's E-Series family of modular, non-blocking systems, enabling BSPs to meet a wide variety of deployment scenarios. BSPs can consolidate multiple access network elements into a single system using specialized software modules that add functionality and remove complexity, thereby reducing the total cost of ownership and the time to market for new services. The company offers a range of training, professional and success services to assist BSPs in every domain of network management from strategy to deployment and management.

These offerings are sold independently and offer unique entry points for new customers who are partnering with Calix to transform their businesses. Moreover, an increased segment of the company's customer base is leveraging all components of the company's platform and managed services in an end-to-end strategy to simplify their businesses, excite their subscribers and grow the value that they deliver for their subscribers and communities.

Finally, to support these managed services, the company offers market activation resources and customer support programs through the company's customer success organization to enable BSP teams to quickly deploy, manage and monetize each service that they provide to subscribers. These resources include marketing content that can be easily customized with on-line tools, training programs, success services and professional services.

Customers

The company markets and sells its platform (cloud, software and systems) and managed services to service providers of all types and sizes. As of December 31, 2023, the company focused primarily on service providers in the North American market. The company's customers span all sizes of broadband subscriber count from a few hundred to more than six million. The company has approximately 1,600 active service provider customers, purchasing directly and through partners, to deploy passive optical, Active Ethernet or point-to-point Ethernet access networks or subscriber premise systems. The company's service provider customers include: ALLO Communications; Connect Holding II, LLC (dba Brightspeed); CityFibre Holdings Limited; Conexon Connect; Cox Communications; Gibson Connect, LLC; Hunter Communications; Jade Communications; Gridiron Fiber Corporation (DBA Lumos); Lumen Technologies, Inc., or Lumen; Paul Bunyan Communications; Silver Star Communications; Tombigbee Electric Power Association and Tombigbee Fiber, LLC and Verizon Communications, Inc.

Calix has a dedicated team of funding specialists, assisting the company's customers with the most up-to-date information on broadband funding opportunities as they are introduced and personalized strategies to maximize their grants to support their growth.

The company classifies service providers into large, medium and small based on the number of broadband subscribers they serve. Large service providers are those with wide geographic footprints and broadband subscribers of 2.5 million or more. Medium service providers also operate typically within a wide geographic footprint but are smaller in scale with broadband subscribers that range from 250,000 to 2.5 million. Small service providers consist primarily of over 1,000 predominantly local independent operating companies, or IOCs, typically focused on a single community or a cluster of communities. They include a growing number of municipalities, cable MSOs, electric cooperatives, fiber overbuilders and WISPs. These entities range in size from a few hundred to 250,000 broadband subscribers.

Sales to customers outside the United States represented 9% of the company's revenue in 2023. The company's sales outside the United States have been and are predominantly to customers in the Americas and Europe.

Customer Engagement Model

The company markets, sells and supports the success of its platform and managed services predominantly through the company's direct sales force, supported by marketing, product management and customer success personnel. The company has also expanded this model to include select channel partners in North America and more than 40 international channel partners. Even in circumstances where a channel partner is involved, the company's sales and marketing personnel are generally selling side-by-side with the channel partner.

Seasonality

Fluctuations in the company's revenue occur due to many factors, including the varying budget cycles and seasonal buying patterns of the company's customers. More specifically, the company's customers tend to spend less in the first fiscal quarter (year ended December 2023) as they are finalizing their annual capital spending budgets, and in certain regions, customers are also challenged by winter weather conditions that inhibit outside fiber deployment. In recent years, as the company's revenue from its large customers decreased, the company has experienced less year-end volatility due to capital budgetary spending or freezing. This, combined with an increase in recurring revenue, has resulted in smaller seasonal fluctuations.

Competition

Vendors with which the company competes include ADTRAN, Inc.; Ciena Corporation; CommScope Inc.; DZS Inc.; eero/Ring (Amazon companies); Harmonic, Inc.; Huawei Technologies Co., Ltd.; Google Nest (a Google company); Nokia Corporation; Plume Design, Inc. and Ubiquiti Inc.

Intellectual Property

As of December 31, 2023, the company held 111 U.S. patents and 26 pending U.S. and international patent applications. U.S. patents generally have a term of twenty years from filing. The remaining terms on the company's individual patents vary from less than a year to seventeen years.

Calix, the Calix logo design, AXOS, Calix Cloud, CommandIQ, CommandWorx, GigaPro, GigaSpire, SmartTown and other trademarks or service marks are the property of Calix.

History

Calix, Inc. was founded in 1999. The company was incorporated in 1999 as a Delaware corporation.