Calix (CALX) J.P. Morgan 54th Annual Global Technology, Media and Communications Conference summary

Platform migration and AI integration

• Completed migration from AWS to Google Cloud, enabling improved scalability, international expansion, and AI-native capabilities for automated workflows.

• First major software release on the new platform occurred last week, with ongoing engagement and value demonstration to early adopters.

• Productivity improvements from agentic workflows are being measured, with broader outcomes expected to be shared at the October ConneXions event.

• Security and trust are emphasized, with proprietary data from 1,200 customers used to train LLMs and ensure reliable, non-hallucinating agentic workflows.

Commercial model and customer adoption

• Customers can still purchase individual clouds, but agentic workflows require adoption of the bundled Calix One model.

• Early adopters have transitioned easily to Calix One, while others can migrate at their own pace as they see value in horizontal workflows.

• Monetization focus is on increasing subscriber growth and productivity, not just selling more clouds.

• RPO is highlighted as a leading indicator for software contract progress, with expectations for re-acceleration in the second half and a strong Q4.

• Pricing is volume-based, with bundled offerings providing better value as subscriber counts increase.

Market expansion and Tier 1 strategy

• Entry into Tier 1 markets is expected to begin with MDU and small business segments, leveraging a consumer-led managed service approach.

• MDU market is seen as a significant TAM expansion, with the potential to double company size and facilitate broader Tier 1 penetration.

• The technology stack enables rapid deployment of additional services once the platform is installed.

• Differentiation comes from offering a managed, lower-cost, consumer-oriented solution versus incumbent enterprise-class technology.

• Sales cycles for Tier 1s are long (about 18 months), with RPO growth as the main milestone to watch.