Q2 2020 Quotient Technology Inc Earnings Call

Welcome to question second quarter 2020, <unk> earnings Conference call.

During the call all participants will be in listen only mode.

After the presentation, we will conduct a question and answer session.

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As a reminder, this conference is being recorded and will be available for replay from the Investor Relations section of questions website. Following this call.

I will now I'll turn the call ever to Stacie Clements Vice President President of Investor Relations. Thank you Ms. Cohen, you may now be yet.

Thank you operator, Hello, everyone and welcome to our second quarter 2020, <unk> earnings call on the call with me today, our CEO Stephen Nolan pans out.

Oh, it's got RASK enterprise, the company's stockholder letters posted almost an hour at that one IR section our corporate website. It's just a question dot com alongside our press release earnings presentation. The payment hosting this call today.

I'm prepared remarks, and play record it feels like any technology interruption prepared remarks today are also brady it shouldn't need more time, becoming.

Let me begin during this call you want to go forward looking statements. These forward looking statements include projections for third quarter employee or 2020, our ability to manage our liquidity into capture marketing dollars during and after the close at 19 can.

Transplants to me, but paused I can make campaigns later in New York Kristen ecommerce our ability to capture marketing dollars on retail performance media VP of France, Turkey spending on aside the effectiveness of our cost control measures and our ability to olapic investments operating expenses as well if they expected growth avenues, that's habits generally.

Looking statements are based on information available to you enough. Good faith beliefs about management team as if the kindness calls are subject to known and unknown risks and uncertainties could cause actual performance as a result to differ materially.

Additional information about factors it actually impact our financial results can be found in today's press release and then the risk factors identified in our annual report on form 10-Q.

The on me and our future filings.

We disclaim any obligation to update information contained in these forward looking statements, but that doesn't result at the information featuring right away.

The exceptional revenue operating expenses gross margin.

Financial measures discussed today on a non-GAAP [laughter] and adjusted to exclude expenses a reconciliation between GAAP and non-GAAP measures can be found in the financial results press release issued today and on the slides posted on the company's website with that I'll now turn the call Liberty.

Hello, everyone and welcome to our Q2 2020 earnings call I Hope everyone continues to stay healthy.

Thanks, You mentioned, we're doing today's call for remote locations.

Revenue in the second quarter was $83.5 million within our guidance range of $80 million to $90 million.

As you mentioned on her last earnings call revenue was expected to be soft in the second quarter due to impacts of coping 19, as consumer packaged goods manufacturers and retailers pause delayed or canceled marketing campaigns to address low inventory levels on store shelves and to help manage retail foot traffic.

This was also the first full quarter. It was negatively impacted by the change of gross to net for a portion of our media revenue.

If that revenue was recognized as gross total revenue would have been $8.6 million higher ore at 12% decline year over year.

We delivered $4.4 billion of adjusted EBITDA, well above the top end of our range of zero to $3 million, primarily due to our continued focus on cost control, which lowered total operating expenses.

We believe Q2 will be the most impacted quarter from the effects, we called it 90.

Looking forward to the back half of this year bookings are already higher than historical trends at this point in the quarter and we have a strong and growing pipeline of new CPG and retail or business.

As a result, we're expecting to second half to grow over 36% compared to the first half of this year.

The public commentary from many of our CPG customers note that they plan to increase AD spend in the second half. This year further validating the expected growth of our business.

Now more than ever maintaining brand awareness and market share remains a key focus for cpgs.

They think about marketing investments and the importance of shifting dollars to digital to be where shoppers are spending their time.

Our teams are moving swiftly building new products, signing new retailers to our platform and delivering exceptional customer experiences.

Today I'm thrilled to announce the we've added two new retailers to the quotient network.

We recently signed Rite aid to our network, adding retailer right you retail performance media or RPM and self service sponsored product search to help Rite aid drive sales an increase shopper loyalty.

We also signed Heidi, increasing our scale with supermarkets and convenient stores in the Midwest.

If you will be launching with retailer right Q and RPM.

She brings a complete set of solution to retailers looking to prioritize digital including the reach and scale of our shopper network adapts technological capabilities actionable analytics and strong measurement capabilities as well as other industry expertise to others simply cannot deliver.

These retailer additions are the results of the work we've been doing over the past 12 months.

As Weve put a sharp focus on growing our pipeline of new retailers and this is only the beginning.

In addition to the retailers mentioned above we have several more in various stages of development. Some are in new verticals outside of our traditional grocery drug mass merchant dollar club and convenience channels and we look forward to sharing more on these efforts in the coming boss.

Can you at least scaling our self service sponsored search platform.

In June we expanded our partnership with a whole delhaize U.S.A.P. pod digital labs to power a self service platform across their U.S. retail banners for sponsored products search advertising.

Rite aid and Ahold Delhaize, USA, Mark our third and fourth retail partners to add sponsored search media Chore network.

For sponsored search media quotient now offers a truly national platform with shopper reach into $150 billion of sales across multiple classes of trade, including grocery drug and dollar.

This scale enable cpgs to shift search marketing dollars from places like Google to quotient.

The investments we've made over the last year since my return as CEO I've been focused primarily around three themes delivering the very best product experiences.

Standardly growing our business and preparing to capture the rapidly accelerating shift from offline to digital.

As most of you know in November of 2019, we acquired you'd be mill, a demand side platform that enhanced our media offering while also lowering a portion of our media costs.

You'd be mode delivers an industry, leading programmatic digital out of home offering.

Since the acquisition, we've added video and audio dynamic messaging and scrolling and other features we have also integrated our performance measurement and analytics platform Tyne campaigns directly to product sales.

Digital out of home represents a new and growing channel to the quotient platform and we're already seeing engagement by many brands and retailers, including those in other verticals outside of CPG and grocery.

We also signed a new partnership with Magic in roads, which disrupts the legacy clearing industry and brings transparency to brands and retailers.

Cpgs now spend less on digital coupon clearing fees, increasing their marketing ROI as the industry rapidly shift from legacy offline print to digital coupons over the next 18 months.

In addition to the highlights I've just mentioned there were several market growth drivers that also support and accelerates CPG and retailers shifted digital.

First the rapidly growing E commerce or online grocery channel. This channel continues to be a source of incremental growth opportunities for quotient has brands and retailers Bill digital strategies and collaboratively align marketing dollars to where shoppers are.

In the second quarter, the percentage of promotions Clifton redeemed from our ecommerce channel increased 131% over Q1 of 2020.

The second retailers are strengthening their digital first strategies and prioritizing retail media.

Quotient retail performance media drives sales and create significant alternative revenue streams retailers, enabling high profit revenue to help fund important omni channel investments.

RPM also helps retailers claim their share of national and shop or digital promotions and media dollars from Cpgs to.

To help drive these available dollars onto their digital platforms. Some of our RPM partners have created programs for brands to commit marketing dollars generally an agreed upon percentage of gross sales.

As many CPG start to enter new annual physical cycles in the fall. We believe the timing for these programs is ideal and should act as a tailwind for us in the back half 2020 and for the full year 2021.

And third the shift from offline paper coupons to digital continues to be a large growth driver as we begin to see more brands adopt strategies and roadmaps for exiting the freestanding inserts.

Several brands are now, adding a corresponding digital coupon for every paper coupon delivered in the aside providing a clear on ramp to further shift spend from paper to digital.

In addition retailers are starting to align on the strategy as well digital coupons remains one of the most effective and efficient ways for cpgs to spend marketing dollars to drive sales, particularly in recessionary periods.

For the above reasons in more we believe we have a large and growing opportunity in front of us. The current environment, just accelerating the shift to digital retailers and brands are quickly responded prioritizing new innovative ways to engage shoppers invest more in digital build loyalty and long term brand equity.

All with the goal of increasing sales with high value ROI on advertising dollars.

Our market, leading strength positions us well to deliver exceptional customer experiences and deep industry knowledge to brands and retailers.

We expect to see significant growth in the second half of the year as Cpgs plan to grow their investment in digital promotions and media. We're thrilled to have a strategy in place that allows us to help shape the future retail as the industry continues to shift to digital and with that I'll now turn the call over to Pam.

Thank you Steven and good afternoon, everyone I'll keep my remarks free I encourage you all to read well prepared financial results and our stockholders letter and then are definitely both posted on our website.

Revenue was $83.5 million down 20% from Q2 last year as we had anticipated in may and built into our guidance for the quarter well that night team had a negative impact on our revenue this quarter as our customers adjusted their plans national media.

In addition to these market factor and as we've previously discussed a portion of our media revenue is now recognizing that call. This quarter. When it had been recognized on a gross basis prior to Q2 2020.

At this business been recognized grows our Q2 revenue would have been $8.6 million higher resulting in year over year decrease in total revenues of 12%.

Media revenue in Q2 was 44% total revenue decreased 22% year over year. This decrease was primarily due to the gross to net revenue recognition change we made it I mean it depends on what has been down <unk> percent from prior year without this change.

Relatively new media offerings, such as sponsored products search and digital out of home delivered significant growth in the second quarter over the last two consecutive quarters as market or try to digital channels to target shopper, Oh, They brand equity and drive sales promotions revenue in Q2 was 56% of total revenue decline.

18% year over year, primarily driven by the impact from corporate 19.

As you know print declined 27% over last year and digital paperless promotion, which are primarily because.

Declined 19% over Q2 last year. This was offset by 15% growth in specialty retail over last year, which benefited from more detailed ecommerce activity during that homeowners.

On a trailing 12 month basis revenue from our top 20 cohort grew 5% year over year, and we thought overall growth of 2% year over year across all three customer cohorts.

Gross margin for Q2 was 39.2% a 40 basis point improvement over the same quarter last year.

Non-GAAP gross margin order was 47.2% a 280 basis point improvement over last year.

Non-GAAP gross margins, primarily benefiting the change in delivery in revenue recognition gross.

Well, let's see increase knutsen.

These benefits were partially offset by lower revenue on the quarter of Oh.

With the expected increase in revenue across our business in second half year fixed costs will scale and gross margins will include given [laughter].

GAAP operating expenses increased by 6.1 million over the prior year, primarily due to higher fair value contingent consideration associated with the ethanol acquisition.

Non-GAAP operating expenses were approximately flat year over year, while also absorbing approximately 40 to one point when you go no acquisition.

Compared to Q1 2020, non-GAAP operating expenses were down 4.3 million, primarily due to cost control.

We delivered $4.4 million adjusted EBITDA in the second quarter 2020, well up off the top end our range, primarily due to focus cost controls, which resulted in lower total operating expenses.

Looking at cash we generated 16.9 million dollar cash from operations have been second quarter, primarily driven by strong accounts receivable collection off strong revenue in Q4 in the first half Q1.

We continue to focus on maintaining a strong balance sheet. We ended the second quarter with approximately $211.9 million in cash and cash if someone up $15.1 million in the prior quarter.

Now turning to guidance for the full year 2020, we have for games visibility and confidence as bookings in pipeline momentum, though we are working with our customer and partner schedule and plan for their investments in the back half a year. We now expect revenues to be in the range 430 million to 455 million dollar.

Over 36% growth in the back half the year compared to the first half.

For the third quarter 2020, we expect revenues to be in the range of $120 million to $130 million or 9% growth over Q3 last year.

It includes the gross to net revenue chain certain media.

Revenue mix between promotions and media for the year, it's harder to predict given the macro trends between these two businesses are focused on improving non-GAAP gross margins over time, a product mix throughout the rest figure could affect the timing positively or negatively.

Second having 2020, we expect non-GAAP operating expenses to be approximately 42 millions of $44 million or.

Assistance with past seasonality of expense, we expect Q4, non-GAAP operating expenses to be slightly higher than Q3.

Adjusted EBITDA for the full year 2020 is expected to be in the range of 43 million $53 million.

Third quarter 2020, we expect adjusted EBITDA in the range of $15 million to $20 million.

Given the increase in our total revenue expectations for the year here to be impacting cobot 19, adjusted EBITDA will be less than we originally expected for fiscal year 2020. However, we are still forecasting significant growth in adjusted EBITDA in the second half a year and we're confident that what we're trying to adjusted EBITDA expansion in 2021 is rapidly.

Given our current forecast, we expect negative cash flow into three due to lower Q2 revenues and lower cash collection for however by Q4, we would expect operating cash flows to be breakeven slightly positive again from higher Q3 revenues and higher margin.

We expect weighted average diluted shares outstanding a 2020 to be approximately 92 million.

In summary, <unk> Q2 was it's all quarter as expected and have to me back to cope with 19 as brands and retailers plan for their digital first priority and investments in promotions and media was down revenue in Q3 in Q4 are expected to grow significantly.

We anticipate further growth in adjusted EBITDA as revenue increases in the back half of the year. The current environment is accelerating that shift to digital and we remain focused on our customers in partner as well as driving sustainable growth in this large and growing market.

With that I'll turn the call over to question.

Operator.

Thank you we will now begin the question answer session.

You ask a question you May press Star then one on your Touchtone phone.

If you're using a speakerphone please pick up your handset before pressing the keys.

To withdraw your question. Please press Star then too.

At this time, we'll pause momentarily to assemble our roster.

Our first question comes from Chad Bennett with Craig Hallum. Please go ahead.

Great. Thanks for taking my questions. So just maybe a quick one just on the gross margins going forward here in the second half the year do do we still plan to get that kind of 50% exit rate in the fourth quarter.

Hey, Chad Yeah, Yeah, we're very focused on getting people say that.

Non-GAAP gross margins were a little bit more uncertain about timing of hitting that.

As we stepped back and take a look at what pipeline in booking look like in the second half a year where seem to be nice momentum.

But product mix is such a significant impact that its a little bit difficult for debt.

You know a lot of our customers, while they were able to shut a share of spending plans what that it's not it's easy to know exactly how the product what between from our media or within either those categories. So the product mix is a big impact.

And we're not sure we're going to get there by Q4 this year.

But certainly certainly in 2021.

Okay.

Let me just let me just add something there it's Steven I'm part of that is due to the fact that we got programs that were paused or or delayed entirely from starting due to covert and are being re booked in the back half and because the budgets and maybe overlapping a little bit that maybe Oh I drive some additional revenue down the media.

Segment.

Than we had been planning for us that's got a big impact on it for this year okay.

Great. Thanks for the color there and then maybe follow up for first Steven just <unk> a couple of parts. I guess you know you talked about Q3 bookings is we stand today.

Being ahead of historical rates I guess in any quantification there in in in a follow up being <unk>.

What is your you feel like your level of visibility into your second half guide that you just gave today versus prior years and I know.

You know you've been back full time, not not even quite a year, but just I know you know the business well so.

What's the level of comfort in that second half 36% increase.

Sure.

So let me let me say a couple of things. The first is we've got a lot of indications now and one of the things that Scott Raskin put in place when he joined over the course of the past 12 months has just bordering on a year now is a whole a whole bunch of tools and capabilities. So that we would have much better visibility on the upfront on the pipes.

Line side, and then Pam put a lot of rig or you know the finance departments. So that we could actually tie those two things together and I would tell you that you know in 20 years plus yeah, we've got more visibility a more confidence we've ever had before and then just yeah. There are some nuggets right. So you know as we sit here today, our Q4 total pipeline is higher.

Or by at least 25%.

You know with it with less than 60 days for the quarter start than we've seen historically.

So we've got that kinda visibility now into our business. So I would say that where we're not at the business and hopefully not business anymore of putting numbers out there on that disappointing. So if we say 36% growth at back half, yeah, we're banking on that or better.

Okay and then when that's actually great color. Also then maybe one last one for me if I could just on the new partners right <unk> Rite aid and Hy Vee great brands, there that you've added.

And any kind of timeline in terms of a roll out to production with with those two and then I'll hop off thanks.

Sure, we're going to let the retailers dictate the timing of the announcements of their go lives, but oh, yeah. There this year and a you know yeah, we would expect them sooner rather than later and I have to take we're we're really excited about this just to add a little bit of color. I think everybody is interested in hearing you know last year, we didn't add.

Any retailers, we added somebody to RPM at the beginning of last year and one of the you know one of the very sharp focus is that we've put on the past 12 months is building that pipeline of retailers and I'll tell you given what I've seen over the past 12 months' the two sidings we've announced a the expansion.

I have another retailer into a into search our search platform and the fact that was clearly stated we expect to be able to share more in the coming weeks and months or more retailer announcements and some off our primary vertical that is really one predictor of the success in future growth of our business and we've just built our very strong pipeline of it.

Additional retailer so stay tuned on that all that fact.

Great. Thanks much.

Sure. Thank you.

Our next question comes from.

What else can draw area with KBC <unk> RBC. Please go ahead.

Okay. Thank you Oh, I'm, sorry, I joined a little bit Lisa I apologize. If this was covered but could you. Please talk about.

The expectation of contribution from your fast do announcements as well as a new ones from this quarter I jumped of your partnership should you know is the expectation that once the partnerships our scale and I'm, referring to 711 ship Rite aid Heidi once they are skilled you could expect some contributions.

Turning as early as 2021.

And any any other color in terms of the nature of these partnerships and how it is going so far with the prior to thank you.

Sure and try to thanks for thanks for the question Thanks for joining.

Actually we would expect contribution in 2020 Oh from these from these recent announcements again, the timing, we're going to leave the timing up to the retailers to announce a their programs and some of those would be analysis I think sooner rather than later, but but now we've yeah Weve Ics, we would expect contribution both from recent and.

<unk> expense prior to this earnings cycle and also these in this calendar year and so generally when we make an announcement we have already begun some of the integration work and so.

Yeah, there's a there's an awful lot of work that goes into forming these relationships and tying off all the technical capability and so actually a lot of that work gets done before we make an announcement. So that's what I would tell you about our expectation with respect to partnerships or you know I'm thrilled with the way the partnerships are there.

All the thing I really am.

Yeah, I said before one of the things that we've been focusing on since since my return and Oh, you're bringing a lot of really capable senior leadership into the business is just that the rigor around the process of onboarding forecasting predicting and have taking products to market and so we.

Bill the things that they know that we called Playbooks for delivering.

New retailers to market for going out and building campaigns and programs with Cpgs in concert with those new retailers and we've got a much better set of metrics that allow us to get up to plan at that measure how well we're doing so I think we're in great shape.

Okay. Thanks Steven.

Thanks Rhonda.

Our next question comes from Elliott Albert would be A. Davidson. Please go ahead.

Great. Thank you. So last week picture is called out a very strong momentum for CPG is in the month of June and July So on monthly trends with a significant portion of your revenues generated at the month of Geron did you see those trends continued your July.

Im curious if you saw sales trends were correlated with reopening phases in different geographies of the country.

Oh, so the answer that question is yes.

We're also you know we're also seeing the effects of not just not just reopening, but also a stock levels, becoming a back to normalized and spending sort of returning to normalized spending pattern. So you're one of the things that I think is correlated with the CPG growth that you. Just mentioned was the fact that retail has stayed.

Realized and stock levels of stabilized and E. Commerce has stabilized all of those things that were under really significant pressure as cove. It started to really hit the U.S.

Have a have I have [noise].

I have leveled out and that allowed cpgs to have a confidence to start deploying marketing dollars again. So we would yeah. We would expect to see the exact same effect and growth.

Okay, Great and then how if at all how does this change the company strategy given the large influx of consumers now purchasing groceries online Amazon reported a 300% increase in the online grocery sales. So are you able to repaying that same shopping data.

Oh, yes, as a matter of fact.

We've we've been long been proponents of ecommerce grocery it it started before covidien really small percentage of total grocery in that kind of 3% range. Obviously that you know the skew from Cove. It has changed the you know the philosophy and the factors associated with that non linear growth overtime that was.

Numbers will stabilize they'll settle down and on a go forward basis, what we expect as they shoppers will now have mixed boat shopping in their homes now that so many people have experienced ecommerce they'll they'll buy some products ecommerce, though still you don't want a return to normalcy and go into store and have that discovery opportunity.

You know picking fruit picking your meet fish specialists to et cetera, but every by definition every E commerce grocery transaction is a digital transaction.

Where every in the store transaction is not by definition digital and so for us the more E commerce, the batter and clearly our sponsored search listing products for example, and our retail performance media do well really well in E commerce strong environment, because those engagements are all again as I say.

But by definition. They are digital you have to shop digitally for E commerce. So.

So that's actually very positive for us.

Okay, great appreciate it.

Thank you.

Our next question comes from Steven Frankel with coal yet <unk>. Please go ahead.

Good afternoon, Steve I'd like to dig in a minute into this notion of retailers pushing their CPG partner or partners to commit.

A percentage of gross sales to the RPM platform used to talk about a 1% number.

Maybe give us an update on whether that's still are reasonable target and where you think we are in this transition.

Sure Steve Thanks for asking actually one of the half percent is a is what we've been quoting and yeah. That's that's really been such a rewarding relationship between Cpgs and retailers now that the platform is at scale and all of them targeting and measurement capabilities or are.

Tightly integrated and so one of those programs is fully in market two more rolling out in the near future actually and I. You know I think I think what we've quoted in the past is something to the effect of you know with some brackets that a 1% of gross sales by.

Cpgs for just you know top three retailers for us or would equate to something in the neighborhood of around $700 million a year.

In revenue and remember that as existing span that is today spent offline and so moving it into digital not only benefits the cpgs because the ROI is on average much higher.

Got the retailer has an opportunity to engage digital shoppers and digital shoppers spend more time in store they spend more time online they spend more in their shopping experiences with those retailers.

Shoppers are clearly advantage because with digital you can deliver to shoppers the kinds of things that they are interested in and so every single constituent in that in that equation is benefiting from this and I actually think water and a half percent as the beginning and overtime, we'll see that scale to two two and a half in a 3%.

Our next question comes from Jed Kelly with Oppenheimer and company incorporated please go ahead.

Great. Thanks for taking my question.

So I I think with coal bed, we've started to see some of the leading fintech companies such as like pay Pal start to invest more their digital wallet on giving your debt your scale <unk> data your scale your partnership with some large grocers.

Is there an opportunity sort of the and integrate your dataset more with somebody's Fintech said that are spending more money or more investment you have to their digital wallets.

Oh, that's a great question or we've looked at a lot of partnership opportunities on the wallet and also on the payment because payment while it may be different right on the wallet in the payment type thing. There is that most of those companies are trying to get at that data and it's not clear to us to what and because on the.

Other side of payment they don't have the relationships with the package good companies that sell most of those products through the retailers we service.

Now that may be a little bit different you know as we said earlier, we're expanding our retail platform off of our core verticals. So expect us to you know to announce partnerships in the near future that are not traditional grocery drug mass dollar club and and convenience for us and in those environments, where they've got a.

[noise] longer standing omni channel experiences for shoppers, there may be an opportunity to integrate a little bit tighter with a wallet provider or payment provider, but as I sit here today I just don't understand what's the value to us would be I, certainly know what the value to the wallet providers and the payment providers would be but I don't see any reciprocals.

Al you to us so I'm not sure if we would invest in ER and that type of relationship.

Got it and then I I joined a little late did can you provide us enough did you provide an update on the 711.

Partnership in the and how it's been trending with debenture and alcohol.

Or just.

No we didn't and generally we don't talk specifically about individual retailers, but but I will say a in the last very short period of time 711 announced a merger was speedway.

And that you know, we're really excited when that became public public news speed with 3900 stores at a terrific loyalty program and so you know we're just we're just really excited about the overall 711 a relationship there are fantastic partner.

All right and then just one more.

I guess you know as we're looking at on employment trends and you know you you've had stayed up on.

Oh, how coupon shopping trended during the last recession I mean, how are you sort of looking at on employment into Fourq you in next year I was there anything.

It's gonna be different this time around versus last recession, and how you see consumer shopping.

That's that's an excellent question and the answer to that is a clear no job either shoppers really turned to value in recessionary times at M. These times or you know if these are unprecedented the unemployment rate is as high as it's been since the great depression, and so and coupons were actually born out of the great Depression.

Even though they started in the late 18 hundreds it was very slight usage until 19 I think thank you 3700, 38, one over 72% or the U.S. population was reportedly using coupons for groceries and so you know, we're clearly working with our brand partner Cpgs and retailers to think about how they deployed.

Emotions and value the beauty that digital brings to the only difference between now and get away back then.

You know obviously technological changes taking place is that we can relieve theory finally target shoppers with information at that comes to comes to light, particularly when you look at things that are on sale in a store typically around 10% of the stores on sale, but in that physical circular you really.

Getting very few things they can be in front of the shoppers, but with digital we can parse down to the individual shopper. The individual offers that we think that they're most likely to want to take advantage of and fulfill the mission of the CPG. The mission of the retailer and satisfy the shopper and so digital really a allows us to might have a much better.

Closer relationship most importantly, deliver the right kind of value to shoppers when they're feeling you have a pinch they are right now it's really a it's really tough for shoppers right now.

Thank you.

Thank you.

This concludes our question and answer session I would like to turn the conference back over to management for any closing remarks.

Thank you operator, thank you all for joining us today M M to those of you on the east, particularly with the storm approaching I Hope you all are safe, we look forward to the second half 2020 as brands and retailers continue to prioritize digital over offline and paper with new retailers expected to be lives soon on our platform and revenue expected to grow overtime.

36% in the back half this year over the first half we remain confident in our strategy and excited for the future growth of the company. Thank you again, we hope everyone stays healthy and safe.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.