Investors given look at company’s transformation and roadmap at new technology center in Chandler, AZ
Investors gathered at Comtech’s new state-of-the-art technology and manufacturing center in Chandler, Arizona for a day of firsts. In mid-June, a group of institutional investors and some of the company’s largest shareholders converged on Arizona’s sprawling tech corridor for Comtech’s historic, first-ever Investor Day, which featured an energized and revamped executive team. They were also among the first to see the new cutting-edge facility in Chandler during a series of tours and presentations.
Comtech CEO Ken Peterman proudly revealed the cornerstone of the company’s One Comtech transformation and the importance of hosting the company’s first Investor Day at its new Chandler facility.
“The selection of our Chandler facility is no arbitrary choice for our first Investor Day, because the work we’re doing here is central to some of the most innovative technology and business initiatives taking place at Comtech,” noted Ken.
Peterman also pointed to the energy, dedication, and hard work of Comtech’s refreshed leadership team as evidence of a company-wide commitment to embrace and deliver on “the rapidly accelerating pace of change” across increasingly converged networks and global technology markets.
“Comtech is uniquely positioned to lead the way, but it’s important to understand that what comes next is not about individual system components as it has been in the past,” Ken shared, outlining the company’s new strategic approach. “Comtech is preparing for a world where there’s not only value in building data transport infrastructure, but also a world where the infrastructure itself is sophisticated and intelligent. We have set forth on a comprehensive strategy to reshape the enterprise, enhance operational efficiency, and usher in a new era of hybridized connectivity.”
The CEO also credits collaboration, integration and convergence on multiple levels, and “our ability to move beyond our historically siloed business structure to exploit the opportunities that market convergences promise, for the ultimate success of One Comtech.
The One Comtech Journey
With a year under her belt as Comtech’s Chief Operating Officer, Maria Hedden outlined annual costs savings to the tune of about 30%, driven by standardizing business processes and operations as well as rolling out a single business enterprise system, among other key initiatives.
She chuckles when asked why Comtech has two different business segments – satellite and space, and terrestrial and wireless – under one roof. “When I started a year ago, we had effectively 14 different business units, which were more or less operating independently,” Maria noted.
The company has consolidated 14 sets of vendors, 14 approaches to legal and contractual obligations, multiple software platforms and offices, and multiple redundant business functions with a lean organizational model “that enables us to respond to business operations with pace and purpose,” said Maria. “The entire One Comtech transformational process is not a project, it’s a journey defined by continuous evaluation, adaptation, and improvement, which means that my job is never done.”
Leaders of Comtech’s Terrestrial and Wireless Business like to describe the segment by saying, “we enable the most important call you will ever make.” It’s a nod to what has historically been the primary business line of Comtech’s terrestrial business.
“If anyone in the room has ever made a 911 call, there is a 60% chance that you have used a Comtech product or service. In fact, for any mobile network operator using network-based location services, Comtech has over 60% of the 5G market in North America,” said Tim Jenkins, President of Comtech’s Terrestrial and Wireless Business. “Our expertise in terrestrial sets us up well for the future we see, where we expect the borders between terrestrial and non-terrestrial to collapse and networks and communications infrastructure to hybridize.”
“When we layer applications like Earth Observation data atop our 911 services to add precision to the movement of objects or individuals around emergency locations, we build growth on top of our current service,” explained Nicole Robinson, Comtech’s Chief Growth Officer. “The geospatial industry has experienced a significant trend over the last two years. There’s a movement away from raw pixels now to insights, fused and processed data that will enable a decision maker to act quickly.”
During an Investor Day recap, Nicole also noted that Comtech is building on its proven market leadership in next-generation 911 (NG9-1-1) services by expanding into new areas, like 988—the three-digit dialing code that routes callers to the Suicide & Crisis Lifeline (or 988 Lifeline).
“Comtech offers one of the most comprehensive NG9-1-1 end-to-end in-house systems available today,” said Nicole. “988 presents an opportunity to weave the national mental health safety net of the lifeline into the fabric of the crisis care continuum. In our view, increased collaboration between 911 systems and 988 can provide more options for those in facing a crisis.”
Nicole went on to note that integrating 988 with 911 emergency response, such as dispatching specialized mobile teams to individuals in the midst of a mental health crisis, can help improve comprehensive services and create greater coordination of tailored care options like crisis stabilization units.
Satellite and Space Opportunities
When it comes to Comtech’s Satellite and Space segment, leaders told the Investor Day audience “if you’ve ever watched a show on satellite TV, there’s a 70% chance it’s Comtech that made the equipment that made the connection possible. Like our terrestrial business, the DNA of our satellite business is defined by a simple truth: our equipment must work any time, every time and in any environment.”
Within Comtech’s Satellite and Space segment, Troposcatter equipment was highlighted as a great example of the company’s technologies that are proven to deliver advanced communications capabilities in the harshest environments. Comtech’s Troposcatter Family of Systems (FoS) are currently being deployed by Ukraine’s armed forces as well as the U.S. military, which means these systems have been proven to stand up to some of the most challenging government or commercial operations in the world.
There are multiple non-defense use cases for Troposcatter technologies, including disaster response where the systems work even when there’s no operating infrastructure. Commercial users can leverage Comtech’s FoS to leapfrog geographic obstacles that would prevent cell towers or cable systems from connecting people.
The company’s leadership team called it a perfect storm for Comtech, where increasing bandwidth, increasing speeds, assured connectivity, and declining cost curves will lead to the marriage of satellite and terrestrial and the creation of hybrid networks that will drive broader and deeper adoption of blended capabilities. Through the company’s differentiated expertise, proven technology leadership, and signature culture of innovation, Comtech is in a unique position to truly lead the way when it comes to technology convergence and smart networks.
The Power of Convergence and Partnerships
“One thing we believe in strongly at Comtech is the fundamental value of connectivity,” explained Daniel Gizinski, Comtech’s Chief Strategy Officer. “The kinds of hybrid technologies that Comtech is developing and building in this (Chandler) facility today can be delivered in a fraction of the time it takes current platforms to close the digital divide and empower our customers with new services,” he noted.
Daniel pointed to an example in Kentucky, where federal programs are connecting rural areas with a buildout of fiber. “This is a good solution as long as time doesn’t matter, because it will take up to five years for the network to reach and serve the people it’s supposed to connect. We’re working hard to help defense and commercial customers understand the benefits of blending satellite and terrestrial networks to create a single unified network that can connect the unconnected and underserved and do so virtually overnight.”
ABI Research is forecasting a little over 50 billion connected IoT devices by the end of 2027, or close to an average of six connected devices for every human on Earth. That data will be collected, and somebody must make sense of it, noted Comtech Chief Technology Officer, Anirban Chakraborty. Comtech is already playing a big role in enabling the increasingly connected world, but EVOKE, Comtech’s Innovation Foundry, leverages powerful partnerships to make the most of converging technologies and blended, layered capabilities.
During Investor Day, Anirban participated in a panel discussion with some of the company’s EVOKE technology partners, including augmented intelligence of things innovator Sirqul, data intelligence company Descartes Labs, and edge computing software-as-a-service provider Aarna Networks.
“Sometimes I think they are not partners, they are more like co-workers,” noted Anirban. “Collectively, we are bringing forward new layered capabilities at an unprecedented rate. Descartes Labs, for example, is integrating their cloud-native supercomputer and data processing capabilities with Comtech’s communications technologies to provide customers with powerful new insights and services.”
Nicole Robinson further emphasized the value of partnerships and the power of convergence as it relates to some of the company’s focus areas for the future.
“Given the momentum we have generated as a result of our discovery phase and the move to One Comtech, we are now in an unparalleled position to prosecute new adjacent growth market opportunities,” said Nicole. “One example is ground systems as a service (GSaaS). Standing on the shoulders of our global technology leadership in ground infrastructure, there is now an opportunity to build upon that expertise with deployed global infrastructures to support both satellite communications customers as well as geospatial and earth observation customers.”
Nicole noted this convergence will also move Comtech into new service-based business models. Beyond GSaaS, Nicole outlined opportunities related to digitization, Comtech’s network agnostic Cloud Dynamic Platform, geospatial intelligence, and location-based services, among other efforts.
“Investor Day provided us with a unique opportunity to highlight some of the exciting growth markets we’re embarking on over the next few months and years,” said Nicole. “Our strategic partners and differentiated expertise during this time of global technology convergence place Comtech in a unique position to not only capitalize on new business opportunities, but truly transform the global technology landscape and make a positive and lasting impact in communities around the world.”
Ken Peterman closed out the historic Investor Day by sharing a few comments offered by customers during recent workshops Comtech hosted. “We’re excited to hear customers say ‘we love what Comtech is doing. We love the technology trajectory they’re on. We used to think of them as the modem guys or the amplifier guys, and wow, they can do a lot more than that.’ And it’s not just our customers who are excited–our organization is excited. One Comtech is working. It’s all around us. We’re in the middle of a massive transformation. And we’re just getting started.”
Click here to watch a replay of Comtech’s full Investor Day.
Certain information in this blog post contains statements that are forward-looking in nature and involve certain significant risks and uncertainties. Actual results and performance could differ materially from such forward-looking information. The Company’s Securities and Exchange Commission filings identify many such risks and uncertainties. Any forward-looking information in this press release is qualified in its entirety by the risks and uncertainties described in such Securities and Exchange Commission filings.