Tigo Energy (TYGO) Q3 2026 Earnings Call: Umsatz sinkt um 21,5 %, Q4-Prognose signalisiert Verlust

Wichtigste Erkenntnisse

• Tigo Energy wies für das 3. Quartal des Geschäftsjahres 2026 einen Umsatz von 24,0 Mio. US-Dollar aus. Dies entspricht einem Rückgang von 21,5 % gegenüber dem Vorjahr und 5,4 % gegenüber dem Vorquartal, liegt jedoch innerhalb der Prognosespanne von 24 Mio. bis 26 Mio. US-Dollar.
• Der GAAP-Nettogewinn betrug 361.000 US-Dollar, womit das Unternehmen das zweite Quartal in Folge eine ausgewiesene Profitabilität verzeichnete. Das bereinigte EBITDA erreichte 1,5 Mio. US-Dollar und lag damit über der Obergrenze der bisherigen Prognose von 0,5 Mio. US-Dollar.
• Die ausgewiesene Profitabilität profitierte von einer Zollrückerstattung in Höhe von 826.000 US-Dollar, die mit den Umsatzkosten verrechnet wurde. Das bereinigte EBITDA enthielt zudem 410.000 US-Dollar an Wertberichtigungen auf Forderungen. Laut Management handelte es sich bei dem Zolleffekt um einen einmaligen Vorteil.
• MLPE blieb das Kerngeschäft und erwirtschaftete 22,1 Mio. US-Dollar bzw. 92 % des Umsatzes. Der Umsatz mit GO ESS ging im Vergleich zum Vorquartal auf 1,3 Mio. US-Dollar zurück, da die Markteinführung langsamer verlief als erwartet.
• Das Management erwartet für das 4. Quartal 2026 einen Umsatz von 20 Mio. bis 22 Mio. US-Dollar sowie einen bereinigten EBITDA-Verlust von 3 Mio. bis 1,5 Mio. US-Dollar.
• Die Umsatzprognose für das Gesamtjahr wurde von zuvor 100 Mio. bis 110 Mio. US-Dollar auf etwa 95 Mio. bis 97 Mio. US-Dollar gesenkt. Dies spiegelt eine schrittweise Erholung in Europa, den langsameren Hochlauf von GO ESS und den Zeitplan für die Markteinführung des optimierten Wechselrichters in den USA wider.

Wichtige Finanzdaten

Geschäfts- und operative Entwicklung

MLPE erwirtschaftete einen Umsatz von 22,1 Mio. US-Dollar, was 92 % des Gesamtergebnisses des Quartals entspricht. Tigo lieferte rund 698.000 MLPE-Einheiten aus, was einer Leistung von 517 Megawatt entspricht.

Der Umsatz mit GO ESS lag bei 1,3 Mio. US-Dollar bzw. 5,4 % des Gesamtumsatzes, verglichen mit 2,2 Mio. US-Dollar im zweiten Quartal. Das Management führte den Rückgang hauptsächlich auf geringere Auslieferungen in den USA und Italien zurück. Das Unternehmen strebt eine breitere Marktdurchdringung durch die Einbindung von Installateuren und den Ausbau in Osteuropa an, einschließlich seines tschechischen Installateursnetzwerks.

Der Umsatz der EI-Plattform betrug 0,6 Mio. US-Dollar bzw. 2,6 % des Gesamtumsatzes. Der jährlich wiederkehrende Umsatz (ARR) von Predict+ belief sich am Quartalsende auf rund 1,8 Mio. US-Dollar.

Auf die EMEA-Region entfielen 76,5 % des Umsatzes, was einem Rückgang von 14,8 % gegenüber dem Vorjahr entspricht. Tschechien und Deutschland trugen 19,6 % bzw. 19,3 % zum Umsatz bei. Polen verzeichnete ein Wachstum von 41,2 %, während Spanien um 142 % zulegte. Das Management verwies auf gekürzte Subventionen und Unsicherheiten der Kunden im Zusammenhang mit anstehenden Gesetzesvorhaben in Deutschland als Belastungsfaktoren für die Nachfrage.

Nord- und Südamerika sowie LATAM machten zusammen 16,5 % des Umsatzes aus. Der Umsatz in den USA fiel im Jahresvergleich um 51,4 %, da sich der Markt für Solaranlagen im Wohnbereich an das Auslaufen der Steuergutschrift nach Section 25D anpasste. Das Umsatzwachstum bei Repowering-Kunden schwächte diesen Rückgang teilweise ab.

Die Region APAC trug 7,0 % zum Umsatz bei und wuchs im Jahresvergleich um 56,3 %, angeführt von einem Plus von 121,1 % in Australien. Tigo plant, die Investitionen für 2027 auf Märkte zu konzentrieren, in denen das Unternehmen an Dynamik gewinnt, darunter Osteuropa und Australien.

Tigo verbuchte im 3. Quartal einen Umsatz von rund 0,8 Mio. US-Dollar aus Lieferungen an seinen US-Partner für optimierte Wechselrichter. Das Management rechnet für das 4. Quartal mit einem höheren Beitrag, wobei der Partner den Zeitpunkt der kommerziellen Markteinführung bestimmt.

Prognose des Managements

Das Management erklärte, dass der Ausblick für das 4. Quartal von einer anhaltenden Schwäche durch dieselben Faktoren ausgeht, die bereits das 3. Quartal belastet haben: eine schrittweise Erholung in Europa, eine langsamer als erwartet verlaufende Akzeptanz von GO ESS und der Zeitplan für die Einführung durch den Wechselrichter-Partner.

Das Unternehmen gab keine Finanzprognose für 2027 ab. Das Management erklärte jedoch, dass es für 2027 ein Umsatzwachstum erwartet, gestützt auf Marktanteilsgewinne, Wachstumsmärkte, die US-Wechselrichter-Partnerschaft und verzögerte Großprojekte. Ein Projekt in Japan wird aufgrund der Witterungsverhältnisse nun für Q1 2027 oder Anfang Q2 erwartet.

Risiken und Beobachtungspunkte

• Die Nachfrage nach Solaranlagen für Wohngebäude bleibt durch gekürzte Subventionen, regulatorische Änderungen und höhere Zinssätze belastet, was laut Management die Amortisationszeiten für Eigenheimbesitzer verlängert hat.
• Die Akzeptanz von GO ESS schreitet langsamer voran als erwartet; eine breitere Marktdurchdringung und Wiederholungskäufe könnten Zeit in Anspruch nehmen.
• Die Marktchance bei optimierten Wechselrichtern in den USA hängt von der kommerziellen Markteinführung des Partners ab, deren Zeitpunkt außerhalb der Kontrolle von Tigo liegt.
• Die Zollrückerstattung im 3. Quartal steigerte den Bruttogewinn und das bereinigte EBITDA, ist jedoch einmalig.
• Die Forderungen aus Lieferungen und Leistungen stiegen auf 15,0 Mio. US-Dollar, während das 3. Quartal 410.000 US-Dollar an Wertberichtigungen auf Forderungen enthielt. Tigo rechnet künftig mit einer Versicherungserstattung von 250.000 US-Dollar im Zusammenhang mit einer Kundenforderung.
• Eine nachhaltige Profitabilität erfordert trotz Fortschritten bei den Betriebskosten und dem Betriebskapital eine stetigere Umsatzentwicklung.

Wichtigste Punkte aus der Fragerunde für Analysten

Das Management gab an, dass ihm vorliegende externe Marktprognosen für 2027 auf einen stagnierenden bis leicht steigenden Markt hindeuten. Tigo geht davon aus, dass seine Marktanteilsgewinne und verzögerten Projekte das Wachstum stützen werden, gab jedoch keine formelle Prognose für 2027 ab.

Das Unternehmen geht nicht davon aus, dass die GO ESS-Expansion zu insgesamt höheren Vertriebs- und Marketingkosten führen wird. Das Management erwägt, zwei oder drei Mitarbeiter in ausgewählten strategischen Regionen einzustellen, geht jedoch davon aus, dass diese Einstellungen im Rahmen der geplanten Kostenstruktur bleiben.

Tigo hat eine zusätzliche Zollrückerstattung von rund 400.000 US-Dollar beantragt. Das Unternehmen hat noch keine Entscheidung erhalten und es steht auch kein Zeitplan fest. Das Management erklärte, dass das untere Ende der Q4-Prognose keinen Zahlungseingang annimmt, während das obere Ende einen gewissen Vorteil enthält.

Bezüglich der Partnerschaft für optimierte Wechselrichter erklärte das Management, dass Bestellungen und Auslieferungen andauern, wobei für das 4. Quartal eine höhere Auslieferungsmenge als im 3. Quartal erwartet wird. Tigo geht davon aus, dass der Partner eine kommerzielle Markteinführung Ende Q4 2026 oder Anfang 2027 anstrebt, betonte jedoch, dass der endgültige Zeitplan vom Partner bestimmt wird.

Das Management erklärte außerdem, dass seine Betriebskostenstruktur ein Wachstum unterstützen kann, ohne im gleichen Tempo wie der Umsatz zu steigen. Es bleibt darauf vorbereitet, die Kosten anzupassen, falls sich die Marktbedingungen verschlechtern.

Vollständiges Transkript der Telefonkonferenz zu den Quartalsergebnissen

Vollständiges Transkript der Telefonkonferenz

Ausführungen des Managements

Operator

[Operator Instructions] Joining us today from Tigo are Zvi Alon, CEO, and Bill Roeschlein, CFO. As a reminder, the call is being recorded. I would now like to turn the call over to Mr. Roeschlein. Please go ahead.

Bill Roeschlein

And it's a pleasure to join you today. Also with us is Zvi Alon, our CEO.

I'd like to remind everyone that some of the matters we'll discuss today are forward-looking. These include our expected business and financial outlook, revenue, and adjusted EBITDA guidance for the fourth quarter of 2026, our outlook for the full year, demand for our products, pricing, our ability to improve operating performance and achieve sustained profitability, market recovery, and long-term growth in the solar and solar storage markets, anticipated ramp of GO ESS and opportunities for our MLPE business, the timing and anticipated benefits of our U.S. optimized inverter program and manufacturing partnership, potential impacts of tariffs and regulatory actions, including U.S. restrictions on foreign-produced power inverters, Section 45X or ITC benefits and tariff refunds and recoveries, and our strategy to grow our product portfolio and international business.

These statements are subject to known and unknown risks and uncertainties, including those described in today's earnings release and in our filings with the SEC. These risks and uncertainties could cause actual results to differ materially from the expectations expressed on this call. Forward-looking statements speak only as of the date made. During today's call, we will refer to certain non-GAAP financial measures, including adjusted EBITDA and non-GAAP net income or loss.

Reconciliations to the most directly comparable GAAP measures are included in our earnings release, which has been furnished on Form 8-K. These measures are supplemental and should not be viewed as a substitute for or superior to GAAP results. Finally, I would like to remind everyone that this call is being webcast and a recording will be made available for replay on Tigo's Investor Relations website at investors.tigoenergy.com. I'd like to now turn the call over to Tigo CEO, Zvi Alon. Zvi?

Zvi Alon

Thank you, Bill. I will begin with an overview of the third quarter results, including developments in our markets and our U.S. [ optimized ] inverter program. Bill then will review the financial statements, explain the items that affected our reported EPS results, and discuss our balance sheet and outlook. I will return for closing remarks before we open the call for questions.

Third quarter revenue was $24 million, within our guidance range of $24 million to $26 million. We also delivered GAAP net income of $0.4 million and adjusted EBITDA of $1.5 million, exceeding the high end of our adjusted EBITDA guidance range of $0.5 million. Three items affected our reported results this quarter: a tariff refund related to prior periods, bad debt expense, and an income tax benefit. Adjusted EBITDA included a $0.8 million tariff refund and $0.4 million of bad debt expense. Bill will cover all 3 in a moment.

Third quarter results reflected the 3 dynamics we outlined last quarter: a more gradual market recovery in Europe, a slower-than-anticipated ramp of GO ESS, and a shift of our U.S. optimized inverter partner's launch to the fourth quarter. We expect them to continue into the fourth quarter.

EMEA revenue declined 14.8% year-over-year as the market continues to adjust to a reduced subsidy environment. EMEA accounted for 76.5% of third quarter revenue, with the Czech Republic and Germany, our 2 largest markets, representing 19.6% and 19.3% of revenue, respectively. Poland and Spain grew 41.2% and 142% year-over-year, while revenue declined significantly in Italy and the United States.

In Germany, [ draft legislation ] is not expected this quarter. Under the current draft, only systems connected by year-end keep today's 20-year tariff, but with the vote still pending, we believe customers are waiting instead of rushing to install.

GO ESS revenue remained below our expectations during Q3. Adoption is progressing more gradually than we expected, but we are continuing our efforts to broaden market penetration through installer engagement and geographic expansion. One example is our October announcement highlighting GO Optimized ESS at the Smart Energy Forum in Prague. That initiative builds on our established Czech installer relationship, supported by approximately 80 megawatts of Tigo technology deployed in local commercial and industrial systems since 2024. We see this as an opportunity to introduce our residential storage offering to an existing network. Broadening our adoption and repeat sales will take time, however.

In the U.S., we recognized approximately $0.8 million in revenue from shipments to our optimized inverter partner. We expect revenue to exceed that amount in the fourth quarter. Our domestic manufacturing strategy remains relevant in light of regulatory developments, including the FCC restriction on future authorization of certain foreign-produced power inverters. We see a potential opportunity to serve demand for U.S.-manufactured products, but we are not assuming that regulatory changes will translate into an immediate increase in shipments. We believe our near-term performance will depend on the execution of our partner's commercial launch.

By region, the Americas and LATAM represented a combined 16.5% of revenue. U.S. revenue declined 51.4% year-over-year as the residential solar market continues to adjust following the expiration of the Section 25D tax credit. Our results in the U.S. are being mitigated to some degree by our growth in sales to repower customers. APAC contributed 7.0% of revenue, and APAC revenue grew 56.3% year-over-year, led by 121.1% growth in Australia.

Stepping back, the softness in residential solar is not only a German story. Italy has phased out net metering and its renovation bonuses. The Czech Republic cut household subsidies and introduced a 50% export cap earlier this year, and the U.S. is absorbing the expiration of the Section 25D credit. Together with a higher interest rate environment, this has lengthened homeowner payback. We believe this is a broad reset in how residential solar is supported rather than a change in demand for what our products do. The direction of policy, including lower smart meter thresholds and caps on grid export, also increases the value of self-consumption and storage over time.

Against this backdrop, higher power prices and growing electricity demand are expected to drive continued long-term growth in the solar industry. Global electricity demand is expected to continue to grow in 2027, and solar is expected to be the largest single contributor to the new electricity supply. In 2027, we plan to invest in growing markets where we are already succeeding, such as Eastern Europe and Australia, to extend our market share. In addition, we plan to continue extending our GO ESS products into additional countries within the Eastern Europe region.

Our priorities are to support customers, work with our partners to advance product commercialization, align expenses with the current revenue environment, and preserve balance sheet flexibility. We have made solid progress on costs and working capital, but we recognize that sustained profitability will also require a more consistent revenue trajectory. And with that, I would like to turn it over to Bill. Bill?

Bill Roeschlein

Thank you, Zvi. Turning now to our financial results for the third quarter ended September 30, 2026. Revenue for the third quarter was $24.0 million, compared with $30.6 million in the prior-year period, a decline of 21.5%. Sequentially, revenue declined 5.4% from $25.4 million in the second quarter. Third quarter revenue was within our previously stated guidance range. Within our product portfolio, MLPE represented $22.1 million, or 92% of quarterly revenue. We shipped approximately 698,000 MLPE units, representing 517 megawatts.

GO ESS revenue was $1.3 million, or 5.4% of total revenue, compared with $2.2 million in the second quarter, primarily due to lower shipments in the United States and Italy. EI platform revenue represented $0.6 million, or 2.6% of total revenue, with Predict+ annual recurring revenue of approximately $1.8 million at quarter-end.

Gross profit was $11.1 million, or 46.2% of revenue, compared with $13.1 million, or 42.7%, a year ago and $10 million, or 39.3%, in Q2 '26. To put the margin in context, U.S. Customs and Border Protection approved certain claims related to IEEPA tariffs paid in prior periods. We recognized $872,000 of refund-related amounts and interest as receivable during the quarter. Of this amount, $826,000 was recorded as a reduction to cost of revenue, increasing reported gross profit and gross margin. The remaining $46,000 was recorded as interest income in other income with no effect on gross margin. These refunds relate to prior periods, and the benefit should not be considered recurring.

Operating expenses were $11.2 million, compared with $12.4 million in the prior-year quarter and $11.7 million in the second quarter of 2026. That represents decreases of 10% year-over-year and 4.3% sequentially, with reductions in R&D, sales and marketing, and SG&A. General and administrative expenses included $410,000 of bad debt expense, including a charge related to a single European customer. Of that charge related to that customer, $250,000 is covered by credit insurance, and we expect to record a recovery in a future period.

Operating loss was $77,000, compared with operating income of $649,000 a year ago and an operating loss of $1.7 million in Q2. The $826,000 tariff refund benefit in cost of revenue and $410,000 of bad debt expense in general and administrative expenses both affected the reported result.

GAAP net income was $361,000, compared with a GAAP net loss of $2.2 million in the prior-year quarter. This was our second consecutive quarter of reported GAAP net income. The result included a $0.3 million income tax benefit, and on a pre-tax basis, we were essentially breakeven. The year-over-year comparison also benefited from a materially lower interest expense as a result of the retirement of our convertible note.

Non-GAAP net income was $1.6 million, compared with a non-GAAP net loss of $260,000 a year ago. This measure excludes stock-based compensation from GAAP net income or loss. Adjusted EBITDA was $1.5 million, compared with $2.9 million in the prior-year quarter and $52,000 in Q2. Adjusted EBITDA included the $826,000 tariff refund benefit and $410,000 of bad debt expense. The $46,000 of interest income related to the refund was recorded in other income and is excluded from adjusted EBITDA.

Sequentially lower operating expenses also supported our performance, but the tariff refund benefit is not recurring. As a reminder, adjusted EBITDA is a non-GAAP measure representing earnings or loss before total other income or expense, net income taxes, depreciation, and amortization, as adjusted to exclude stock-based compensation and merger transaction-related expenses. Non-GAAP net income is also a non-GAAP measure. It excludes stock-based compensation. These measures are intended to supplement, not replace, our GAAP results, and the reconciliations are provided in today's earnings release. Weighted average basic shares outstanding during the quarter were approximately 77 million.

Now turning to the balance sheet, accounts receivable, net, increased to $15 million from $13.6 million at the end of Q2 and $13.9 million at year-end 2025. We continue to monitor receivables as part of our working capital management. Inventory was reduced to $18.1 million from $20.6 million at the end of Q2 and $31.3 million at year-end 2025. That is a sequential reduction of approximately $2.5 million and a year-to-date reduction of approximately $13.2 million, or 42.1%. Inventory discipline remains a priority as we balance supply requirements with the current demand environment.

Cash and cash equivalents totaled $16.8 million at September 30, compared with $16.9 million at June 30 and $7.7 million at year-end 2025, supported by the approximately $14 million in net proceeds from our February registered direct offering. Borrowings outstanding under our revolving credit facility declined to $2.5 million from $4.1 million at the end of Q2. Borrowings under the facility were 0 as of December 31, 2025. During the quarter, we reduced borrowings by $1.6 million while keeping cash essentially flat, supported by continued inventory reduction.

Turning now to our financial guidance for the fourth quarter of 2026 and our outlook for the full year. As in prior quarters, we provide guidance for revenue and adjusted EBITDA. We believe these are useful measures for assessing business performance. For the fourth quarter ending December 31, 2026, our expected ranges are as follows: We expect fourth quarter revenue to range between $20 million and $22 million. We expect fourth quarter adjusted EBITDA to range between a loss of $3 million and a loss of $1.5 million. For the full year, we expect revenue to range between approximately $95 million and $97 million. This compares with our prior outlook of $100 million to $110 million. Our fourth quarter outlook reflects a continuation of the dynamics that affected the third quarter. Actual results may differ materially from our guidance.

That completes my summary, and I'd now like to turn the call back over to Zvi for final remarks. Zvi?

Zvi Alon

Thanks, Bill. Our fourth quarter outlook reflects the market and timing factors we discussed today. We've concentrated investments in growing regions where Tigo is seeing success. Coupled with a scalable cost structure, we believe we are well positioned to deliver profitable growth as volumes recover. We believe the strategy laid out for 2027 will yield top-line growth for Tigo in 2027.

As we look ahead, I'm encouraged by the progress we are making in the areas within our control. We have strengthened our balance sheet, positioning Tigo to operate more efficiently as market conditions improve.

Operator, please open the call for Q&A.

Operator

Our first question comes from the line of Sameer Joshi with H.C. Wainwright. Please go ahead.

Fragen und Antworten

Sameer Joshi

We understand the lower guidance for the fourth quarter, but how do you see 2027 from where you're sitting right now? What will be the contributors to 2027 revenues that may not have come through in this year?

Zvi Alon

Thank you for the question, Sameer. Projections in general for 2027 by various analysts and what we hear from the market are flat to a slight increase. That's in general. We have demonstrated that despite the market conditions, we continue to grow market share, so we do believe that we will see the benefits of that.

In addition, we did mention in the prior quarter in Q2 that we missed due to 3 factors: 2 of them were large projects and 1 which is the partnership we have. So the partnership is projected to get back online in Q4, and the 2 projects—1 of them, which I believe I mentioned, was in Japan—is going to happen most likely in Q1 of 2027 or early Q2, mainly because of weather conditions.

We don't expect to see that, but that will be in addition to our projected being within the market. So we are not providing any guidance for 2027, but we do believe that we still have the factor of those large projects.

Sameer Joshi

Understood. Thanks for that color. So next year also includes the efforts to expand GO ESS adoption by the market. Does this imply higher costs on the marketing front going into 2027?

Zvi Alon

It would not mean higher marketing or sales costs. We've made some internal changes and focus to make sure that we are able to actually convert it to additional potential income for those products, and we do believe that those changes will help us improve the results. In addition, we might have 2 or 3 hires in specific strategic regions, but we do believe it will be within the cost structure that we've outlined. We are very careful about operational efficiencies, very, very careful.

Sameer Joshi

Got it. And then just 1 more on tariff refunds. I know Bill clarified that these were 1-time and non-recurring, but is there any chance of—is there anything outstanding that you are yet to receive on the tariff refund front?

Bill Roeschlein

Yes. So we have applied for another $400,000 that we have not heard back on yet, so we don't have the timing nailed down on it. The guidance essentially reflects at the low end not receiving it, and at the high end receiving some of it. Given that we received the initial refund, we believe that we'll have the second refund accepted, and once it's accepted, we'll accrue a receivable for it.

Sameer Joshi

Got it. Thanks for taking my questions. I'll step back.

Bill Roeschlein

Thank you, Sameer.

Operator

Our next question comes from the line of Eric Stine with Craig-Hallum Capital Group.

Eric Stine

Hi, Zvi. Hi, Bill.

Bill Roeschlein

Hi, Eric.

Eric Stine

Maybe we could just talk about EG4. You mentioned the revenue recognized in the quarter, and you're clearly talking about it in current tense in terms of revenue—that things are going there in the fourth quarter launch. Could you just dig into that a little bit? Are we still kind of in pre-launch mode, what kind of visibility do you have into that starting, and when might you think the contribution becomes apparent in your business in 2027?

Bill Roeschlein

As we've mentioned on previous calls, we do have a contractual arrangement with them that does have minimum order quantities, and we have delivered. In Q2, we delivered some of it and some of our optimizers, as well as Q3, and we expect to ship even more in Q4. But you have to appreciate that the ultimate timing on the go-to-market is not within our control; it's completely up to them. Our belief is that we are tracking towards a go-to-market late here in the fourth quarter and early in '27.

But again, the ultimate timing is going to be dictated according to our partner, not us. We think that it's positive news that they're placing POs and that we're shipping product to them. I wouldn't expect that they would be ordering product just so that it could sit in a warehouse. That wouldn't be very wise on their part.

Eric Stine

Got it. Just to clarify, in Q4, you do expect a contribution, but it still should be pretty minor. This is more about it being a start here, and then it just depends on what the cadence is of that launch.

Bill Roeschlein

Yes, what we said was that we expect revenues to be higher than they were in the current quarter, so we're expecting to ship more product this quarter. We'll see what happens. We'll get through RE+, and our partner may have some update of their own that they may wish to talk about. Then as we move into late in the year and '27, it's our expectation that our product is not going to just simply build up in the warehouse, but that they will launch. That's what we would expect.

Eric Stine

Understood. Maybe 1 last thing for me then, just on the cost side. You've obviously had to adjust to some market changes over the last couple of years, and you've shown the ability to flex down on the cost side. You came down on OpEx in this quarter, and I know there were some 1-timers in there. Any further downside there, or thoughts dictated on business seasonality early in the year? Is this a number that we should expect for the foreseeable future?

Bill Roeschlein

As with many companies, this is now budget season as we look into 2027 and we finalize our budgets here in the fourth quarter in early December. As Zvi mentioned, we are taking some existing resources and committing some new resources to certain growth geographies where we've done really well and where there's expected market growth next year. We mentioned Eastern Europe and Australia specifically, because we've seen some pretty tremendous growth that we mentioned in the earnings and the script—Poland, Czech Republic, Australia, phenomenal growth.

There are some other regions that we're going to be concentrating on further to get the top-line trajectory moving up, and we have a cost structure that can flex with that. It doesn't have to grow with that. That's pretty much the scalability that you mentioned that we run with here. That being said, if the market turns, we would make cost adjustments as we did in '23 and early '24. That demonstrates that we can scale up or down, so we've done that in the past and continue to have that attitude going forward.

Eric Stine

Okay. Thanks.

Operator

Thank you for your questions, Eric. At this time, I'm seeing no further questions in the queue, so this concludes our question-and-answer portion of the call. I'd now like to turn the call back over to Mr. Alon for closing remarks.

Zvi Alon

Thanks again, everyone, for joining today. I especially want to thank our dedicated employees for their ongoing contribution, as well as our customers and partners for their continued hard work. I also want to thank our investors for their continued support. Operator?

Operator

Thank you for joining us for Tigo's third quarter 2026 earnings conference call. You may now disconnect. Thank you.

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