Q3 2020 Perion Network Ltd Earnings Call
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Good day, ladies and gentlemen, your current cap host for today's conference. We are awaiting additional such expenses should be starting shortly thank you for your patience piece continue to roll.
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Welcome to the period next work third quarter Twentytwenty earnings Conference calls.
This conference is being recorded.
A press release detailing the financial results is available on the company's website at <unk>.
Dot com.
Before we begin I'd like to read the following safe Harbor statement.
Todays discussion includes forward looking statements.
These statements reflect the company's current views with respect to future events.
These forward looking statements involve known and unknown risks uncertainties and other factors.
It was discussed under the heading risk factors and elsewhere in the Companys annual report on form 20.
That may cause actual results performance or achievements to be materially different.
I need future results performance or achievements anticipated or implied by these forward looking statements.
The company does not undertake to update any forward looking statements to reflect future events or circumstances.
In prior quarters. The results reported today will be analyzed folks on a GAAP and non-GAAP basis.
By mentioning it'd be tough, we will be referring to adjusted EBITDA.
We will.
I've provided a detailed reconciliation of non-GAAP measures to their comparable GAAP measures in our earnings release.
Which is available on our website and has also been.
Field on form 8-K.
Also during the call today are.
Ron Gerstein Koreans Chief Executive Officer, and now it's gone Koreans Chief Financial Officer, I would now like to turn the call is no worse keep door on guest stylist. Please go ahead.
Thank you and good morning, I hope everyone is healthy and that your families are doing with [noise].
Steve its preformed brilliantly during these strange difficult times and the results of their exports speak for themselves.
I want to take this moment to recognize and thank them for their dedication and effectiveness.
They supported our business across the three pillars digital advertising.
During the third quarter fairly increased total revenues by 27% year over year. The reason by 200% you or your revenue growth in CPV, along with the acquisition of content I Q and Bob Ocean.
Hey, these in arguably demonstrates our ability to outperform that digital advertising industry, even if we got worse.
Our goal for the led by 76% increase you know advertising division [laughter] solely as a result of increased spending.
Thank you Dorothy TV.
They do they data reach word consumer are increasingly demanding brands deliver more focused relevant messaging.
This was the main too eager for the growing demand for CP V, which is defined as baby care website that stream content over the internet capable to serve one Ed one household as opposed to both gossiping going into older households isn't resolved it.
Advertiser shifts the wafer it seems both competing for eyeballs to creating meaningful engagement experience that first kept your and truly convinced audience.
We are focusing on leveraging go creative capabilities and enhanced fit TV offering by providing CPV interactive ads to better align the awareness of performance. The reason content for the REIT persona there.
The right time, the right stage of the funnel.
Our search business grew by 3% due to the increased volume of smoking monetize queries, we delivered to Microsoft Bing.
I have a strong confidence on our ability to extend current agreement by the end of the year, we from Microsoft being in a better terms than what we currently have.
Our results also triggered by the fact that we are becoming an even more efficient company as we grow.
Thanks to the scalability of our operating model tight management of expenses and our synergistic acquisitions.
Before things factor whats the pandemic has amplified the economic value well for a 10 million dollar cost saving plan, which was implemented in the first half of the year.
Oh, we increased efficiency, resulting from ongoing investment in automation, it's it's driving a 15% year over year growth in adjusted EBITDA to $8.7 million.
To be honest I'm sure. Many of you didn't expect to see results like this already.
Our accomplishments are all the more impressive because we've done to be doing 100 year, then that make that is appended the digital media marketplace and it's a lift in many previous successful at the company and advertising agency wounded and bleeding.
Oh, its success topline and full.
Topline and bottom line during these times demonstrate that our focused and relentlessly implement the blend of diversification across the three main pillars of digital advertising was is and will be there will admit to our growth very easily.
No certainly its strategic plan of diversification into a successful action.
We have a clear path to sustainable and consistent double digit growth going forward.
Let me repeat we have a clear path to sustainable and consistent double digit growth going forward.
I've articulated our ability to benefit from the vetted vote, then continuing spending shift between the three pillars search social and display and video seems to like 2017 sleep.
Three months after I joined Perry.
The technologies, we have developed their acquisition, we have made and successfully integrate it and the team. We've built all these moves this position us to capitalize on having strong solution.
Whatever the dollars flow.
Oh, it's social platforms and offering creates opportunities we seem to enormous social advertising universe forms.
From Facebook to tweak their snapped antique, though as they grow we grow its Brent seeks to build their DTC business. We go I am sure you. So snaps results last week.
Our core fuel business allow us to benefit from the simple fact that more consumer searching and shopping online and also looking for important information about the pandemic and its impact on their lives.
Our display video and our focus on CP V business are able to capitalize on the inherent growth of these digital formats. Its brands are investing seeking a flu final solution.
When all these categories grow we'd benefit.
And when dollar shift from one or two out there we are hedged and benefit as well.
Our diversification strategy also allow us to capitalize on the mega trends in the industry.
He may still third party kooky, the acceleration in housing by brands and they need to turn their awareness dollars into action.
As we look to the future is defined by macro industry trends, we wouldn't be strengthening of our technology moat by accelerating the integration of various business units.
Our strategic roadmap is led by developmental for flu funnel experience to accommodate current trend of marketers who are looking for holistic one stop shopping vendor, who can maximize reach and build their brand. They cross the sweep dealer weve even stronger solution.
This is an exciting business model evolution for us, we know that rent face a massive challenge of attracting and retaining users engaging their franchise and generating first party data and social media is increasingly limited in its ability to meet those goals.
We're calling these synergistic solution capture and conveying.
It Leverages, our unique and proprietary bonding technology AI driven decision engine and the ability to deliver parents are alive real time advertising layout, then constant only.
All in all to create a level of marketing funnel optimization that is exactly what the brand for me.
We're showing that we can keep you use there you know we're capturing convene advertising look for more than six minutes. It truly revolutionary approach and then at the court where the tension of consumer is measured in seconds.
The combination of Wednesday, various financial strategy, and our capture and convince business offering will work hand in hand to drive growth and revenue beyond the current performance metrics.
With that I'd like to turn the call over to modes to review the financial results for the third quarter mode.
Thank you, though on the thought when I said always built during the third quarter. Despite the pandemic effects dong business execution and the successful implementation of efficiency measure and cost saving efforts, we do at the beginning of the second quarter.
These achievements resulted in higher revenue why keeping the level of our valuation on expenses, which improve our goal stability and cash flow.
Jim will result, inflected also other second increased guidance, we provided earlier this month.
And just go that's very on the Airlink Pablo and financially I think that is the key to execute on this the veggie just thought the G. dawn articulated just a moment ago.
Turning to the results.
And that therefore, they'll do any to any revenue increased by 27% to 83.4 million composed of 37.9 million from exercising and 45.5 million phone fits in other revenue. It just I think represented 45% of steady growth in revenue and we.
Yes in other parts of your think 55% and that this quarter of 2020 advertising revenue grew by 76% year over year driven by a two onto the revenue more in CPV along with the acquisition of content. Thank you and Bob Olschan phone any idea.
You said its revenues increased by 3% due to along at a larger number of monetize search right, we delivered to Microsoft Lync.
Customer acquisition cost and media buy and it does go through any penny was 49.9 million or 60% of revenue compared to 4.2 million all 52% of revenue in the third quarter of 2019, the increase as it doesn't that your revenue is primarily due to the acquisition.
Chance of securing promotion.
Okay General expenses in the third quarter was 2020, Red 29.7 million, Oh Daddy, 6% of revenue compared to 27.6 million on all 42% of revenue in the third quarter of 2019.
Efficiency measure with Duke together, we just synergetic acquisition of six you're in promotion.
For anthem data do I have to do.
Net income for the third quarter of 2020 was 2.1 million or eight cents diluted share compared to net income of 2.9 million or 11 cents per diluted share in the third quarter was 29 game.
Yeah, non-GAAP net income I mean that that's what they'll do any training was $5.9 million or 21 cents. They looked at shell compared to 5 million or 18 cents.
That's yeah that does what they'll have to thousands banking.
Adjusted EBITDA in the third quarter was 2020 was 8.7 million or eight eight.
Hey, at 10% of revenue compared to 7.6 million or 10% of revenue in the death or else it Doesnt banking.
Guess snowfall gray think activities in the third quarter was 6.6 million inclusive of folks differently for me go negative impact you all think of it then it in connection with the <unk> acquisition of securing pub Ocean.
There are 211.1 made on independent hotels 2019.
As of September 30, we had guess, yes, it could be the land as Joel down box deposit 60, maybe compared to 61.6 million as of December that the faster doesn't thinking.
As of September 32020, so it says that comprise all it standpoint for me on credit facilities, and 12.5 million drawn from the secured credit line and you're at the show them.
Coach and manager related to COVID-19, compared to 16.7 million as of December 31st It doesn't banking you only that there what they'll do it doesn't have any the credit facility decreased by 2.1 million you do the schedule downtime don't pay though.
This concludes my financial overview for the third quarter of two entities and I will now turn the call back to dawn for closing statements. Thank you Michelle.
Variance diversification strategy and our steady course of managing profitability were key success factor beginning before the pandemic and continuing thereafter.
That's the plan has been extraordinarily beneficial, especially during these challenging times.
The combination of our ability to react fast.
Fine tune, our business and successfully execute the prudent cost saving plan and acquisition strategy to.
Together, we see encouraging market trends and improved visibility.
Allowed us to announce earlier in October that we are raising our expectation for the second half of 2022 revenue of $164 million to $174 million and adjusted EBITDA of $16 million to $18 million.
Looking further out we are confident that we are on that path to achieve sustainable and highly profitable double digit annual revenue falls.
[noise] operator, now you can open the call for questions.
Thank you if you would like to ask a question. Please press star one on your telephone keypad.
Star one to ask a question.
We can now take our first question.
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Jason Houseworth from Oppenheimer. Please go ahead.
Thanks, I'll ask you too so can you talk a bit more about the performance of content.
Top ocean sequentially, maybe from second quarter third quarter, and perhaps give some more color on the trends in these brands and then second we're seeing increased momentum around unified ideas as the world's kind of preparing for I'd say and cookies to potentially go away or be less diminish but definitely one.
Let them run unified ideas on what opportunities does is create for Perry on or just how are you thinking about unified piece. Thanks.
Yep.
Hi, Jason Thanks, Thanks for the question so as far as the as far as the comparison models on the content side Q.
On both on elevated we're doing better than last year and also better than previous growth. There looking of course of the two acquisitions. This is one business unit that's running.
All different problem out there we're doing we're doing better.
In terms of our preparation for a cookie less.
I mentioned that on the on the previous call. The fact that we are creating our own walled garden using go only know on owned and operated site.
Both by content type deal and the promotion and giving us the ability not to depend on a third party cookies and that's just one aspect of the way we are trying to prepare ourselves for the scrupulous euro and other things that were doing is what we call the developing our.
All night D, which is driven very much but on different business units that has a touch point with consumer it has to do with.
Eric consumer that search and it has to do with consumer that are looking for a social and others that are very much part of coming through our own and non operated and creeping a unified they'd be there and that allows us to enjoy the fact that comedians all.
Consumer is living there I'd, we've seen our assets.
And let me ask one follow up so there seems to be building pressure on Apple to consider finding a way to make it more.
More practical for consumers not to use Google I don't know how practical it is but if there is if there is movement.
I don't know how much apples going to want to take you know whether being is more highlighted or Apple launches. There you know price to launch their own search I mean are there partner opportunity. Just have you had any discussion with apple or anything you can share about it there is kinda movements on the I phone to make a you know Google less of the.
So.
Featured surge is there any opportunity for Barry.
Yeah.
The only thing that we can share we are very much under the various Threeq. Then D is the fact that well Google is losing market share or others are in a great opportunity to gain market share.
And then being is definitely one of them. There's not so many that has the capability to provide the quality search on the level of Google and definitely being in the yard which is very much related to being in the two Aldo, let's say three or four candidates. So.
We are definitely welcome this trend.
Okay, great and the like so its fourth quarter results.
Thank you.
We can now take our next question.
Eric licensee from next week.
Yes.
Yeah.
Into the catcher and convince technology.
They go to market strategy in other words is yours.
Advertising sales force is going out into the market and talking with brands and talk.
King.
[noise] agencies is captured and convince a new strategy there.
Offering to them, which incorporates the search and.
Video and social or is it really kind of an in house expression.
For.
No I think that first of all that's going to be a narrative, which is apply across all deals because they are very much integrated into into this concept and it's not just a limited.
To what we are doing on our own site, it's definitely us do us on to Tom and in a way that our ability to connect awareness to performance and providing a full funnel to revusiran and the emphasis was capture and convince has to do with capturing.
Bleaching user it's not the way of retarget, it's a way to completely go after a new user through our great buying system that is a on social need be on one hand and their own content recommendation on the other hand.
So that's a that's very much going to be the narrative of our advertising or business units.
Okay, and then you talked.
I don't know if it was in the theoretical or any explicit about profitable double digit world.
I look at what your guidance is for Twentytwenty part of the full year is 295.
If I put a double digit growth rate on that minimum double digit growth rate that 10% growth.
Plus $325 million of revenue.
What you want.
So right now consensus is around 300, twentys. So just curious to know if you're comfortable with that.
If you feel like there's upside to that.
It's about the double digit.
Yeah. We are we are very much.
We're very much behind it and ER, we are we believe that.
That we're very much behind that double digit.
And then accordingly, then the more they need to be updated.
Okay.
If I look at the you have there.
Pretty consistent on the Microsoft contract renewal ever.
Probably over the last 12 months and given the same message.
Q4 renewal.
Hopefully on better terms.
Tell us about the negotiations that are I realize it's a sensitive topic, but what can you tell us investors about how things are progressing in those discussions.
So thanks for the question that even though I shared my confidence in its you know over the course of the 2020 I must say that we are our confidence my confidence level is gone.
It's it's growing because we definitely know that we are getting.
Close to the finish line.
And it's getting close to the finish line and we know basically what are what is the negotiation on what we agreed so on and so forth.
We can't announce it because it's not signed yet but the only thing that I can say that we are in a very very advanced stage.
Okay, I look forward to the completion.
That.
Very important agreement.
So not a big numbers.
Let's see the business rebound so quickly.
<unk>.
In Q4.
Yes, very much thank so much.
[noise] and we can now take our next question from Chris Mcginnis from Sidoti <unk> Company.
Good morning, Thanks for taking my questions and nice quarter.
Thank you.
Starting off with.
We obviously you highlight that a real strong which you just talked about.
The offering and whats attracting people stay at home and and it's not kind of the driving factor.
Just talking about that that's frankly the same.
Yes, absolutely.
We I I knew that this question will come because we booked in the last year tremendous efforts via at this stage I invited then ex the president of Undertone to this goal then you are there.
Yes.
Great can you take this question and elaborate more on the tremendous success you guys are doing around CPV.
Yes, happily and back to the question so.
On this call last year.
The new products that uncontrollably boring CPV was one of the ones that we had in mind.
They say that because he is an important part of.
The transmission in articulating client campaigns across the funnel, which allows the fishing effective use of creative assets and data. So seems to be a course carries along with the benefits of woodworking.
Particularly awareness, but it can do a lot more than that.
He hopes advertisers to try out high attach channel to find quality prospects and the reaction we target views of CTP adds across other devices.
Further down the funnel, we do that the things like automated content recognition. These yards talk much about that over the last year, but also on how interactives capability allows us to also use seeking to drive people to a transaction. For example, just one small use of that would be QR code.
This allows also the benefits allows us actually participated in the whole direct to consumer advertising market, who use QR codes and the like extensively.
For campaigns. So TV is been a success for us it's a very important part of Michigan and its growing rapidly and allows us actually now to step into a movie cool Oh.
Revenue, which was linear TV, which wasn't part of our mission, which is now accessible to us.
Let's turn to become leaner TV evolves into more of a digital format.
Great I appreciate that and I guess just what.
Striking would love them to we parse out acquisition based growth versus maybe organic I'll just on the advertising.
We can they can say this year over here.
The then they'll go I think that.
There is organic of calls go but if we're looking on the on pro forma basis year over year, we're talking about girlfriend more than that 10%.
Well if you look at your answer.
Okay, and how much you think maybe with some pent up demand or it was more about just listening to your product off on you know wed like and they and that's kind of changing upon.
So what we basically you can see that the you know Andrew.
Advertiser slowly coming back is we basically said.
We see a substantial improvement in that spent you know as the quarter progressed.
With the fact that emphasize on connected TV, but we've seen something else, which is very interesting isn't it.
The agencies and then and the brands are looking to reduce the number of vendor that there you know talking we're still looking for.
One stop shopping when it comes to the different channels.
Which fits very well our model to the we've covered as we said the three main pillars and that's coming from from one one location. So.
It's not just that the deal was less they were able to demonstrate how are the different channel really very much they interact.
With each other to generate higher lift as they call it or better engagement for their consumer. So I think this is a very very important trend and that is caused by different that making the difficult times that everything has trying very much to on one.
And then.
<unk> increased their revenue, but doing it way smarter and this change is very much play well the way we very much set our strategy.
Yes, no I appreciate that answer my questions and good luck in Q4.
Congrats on the strong quarter.
Thank you. Thank you very much.
Okay.
Okay next question.
Derrick.
Oh.
Okay.
Okay.
Hi, Thank you.
Graduations, Ron and team on a strong quarter, it's great to see such a significant being down so quickly as I can.
Of the 19.
Thank you. So yes, you are welcome.
Yes.
Are you going to get to a point, where you can provide some adjusted EBITDA guidance for 2021, I know well, maybe a little bit early coming out of the crisis, but that's something that we provide in the past.
Yeah, it's a it's a bit too early to know first and foremost we need to meet the guidance that we just raised for the 2020 and hopefully to beat and so this is and as you know we know we're you know industry.
Q4, you the most significant quarters due to the holiday season.
And we have we have good visibility.
On the quarter since its almost one month season behind us.
But again, our focus is to finish and finish the strongest possible. So this is what they.
The second knowing what we have been doing.
And quite to Luka Luka.
Behind our shoulder to 2021 week anyway, it's a very very important statement.
About growing our business and the double digits going forward and we very much behind so it's not specific guidance, but could provide the framework where are we going to be in next year.
Thank you and then looking at Microsoft commentary yesterday, they said that search revenue ex Tac was down 11% in constant currency.
And yet today you're reporting.
6% increase in circuit, an important first of all great job and.
Having additional search revenue from non Microsoft ecosystem and the second I'm curious if you could provide a little bit of commentary that how you were able to grow the spot.
Microsoft Bing search falling a bit yeah.
Yeah.
Yeah. That's a that's a that's a good question I think that first and from almost.
We're not working and only and we from Microsoft and there are selected countries in which we are and that's working with Microsoft So we halo.
To optimize and.
I say that.
In areas, where we're working with both.
We have the capability really optimizing the search.
And and this is a very interesting technology that we're developing they were for a given keywords.
We basically can they react to redirect this keyword to the most.
To optimize their results from a revenue standpoint.
So we are putting a lot of technology to optimize it.
And I think the results and the results are there and we're very glad that we able.
To leverage the technology that we have and in order to optimize their results.
Great. Thank you I want to welcome mentioned grabbing his attention or more than six minutes on plays in a world where it typically user engagement and.
Second how do you capture project.
Oh, so that's that's a great question. So one of the things that which we are really proud is the technology that they are to develop that has to do with and.
It's a it's it.
Trying to create the personalization on three elements that add that we very much kept your your retention or user intervention for over six minutes. One is very much has to do with the layout of the page delay.
The layout is very much different between genders age and that's the layout second has to do with the right content. Its not just the topic. It's also the length of the content the type of the content and the way we delivered the content. The third element is has to do with the creative.
Well it has to do with it.
And the proportion of Ed to content type of add everything here is all needs to provide an experience that they use there was cool in school more and more and what is really interesting is what we're doing with these days.
So the capture of new user that stay for a long time and allow us to develop a very sophisticated previous predictive analytics, what we called the convinced is to put the right direction at the right time.
And in order to get the most out.
Out of this you know a very a useful tying that wave is to learn to use there and able to optimize.
These periods of time into the maximum revenue we call it the session and the K.P.I. that we very much manager, it's called the revenue per session and the revenue per session. The session to start from the once the user is lending on our lending page all delay.
We feel its exit after six and more minutes and that's the revenue that is being captured during these times.
Great. Thank you very much very helpful.
Last question, you mentioned wounded and building competition.
Great fiery rhetoric as we've rolled out from either of.
Now are you are you looking at additional M&A.
So we always looking let's say put it this way we're always looking for opportunities and Unfortunately, you know these company that didn't make it and they are attractive for us to buy.
We developed a certain type of framework of acquisition that we feel more comfortable in.
And as.
As I mentioned in previous goal, which is less on an up front then heavy on the earn out that's the model that we going after its a third the acquisition that we did that follow this model.
Not every company is willing to go after this model, we're looking for something which will be substantially less revenue it needs to be accretive.
Jim I can definitely said that there are lots of opportunities now and then I think the fact that we have the financial resources is definitely gives us a great appetite doing it and then being picky on on on what we are trying to do good.
Great. Thank you very much and congratulations again on your existing resilient and showing that that revenue growth, which we've been looking for for quite some time.
Yes. Thanks.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
All lines.
Well take our next question from John Noble Tom Tom Lynch Brothers. Please go ahead.
Hi, good morning, Dilon and mobs and thanks for the call and taking my questions.
I'd like to know how much the U.S. election advertising impact your third quarter.
And what impact do you believe it would have on your fourth quarter.
Do you still feel that which we segment the federal type.
Well overall U.S. election advertising, obviously, a you know that's a big pick up in advertising with U.S. elections. So I just wanted to know how that played into the third quarter and what do you feel that would impact your fourth quarter.
Yeah. So.
So oh advertising is a and the last three months old.
Almost 45% of of the revenue.
And she said $37.9 million.
In this segment is growing and growing rapidly as they basically said we've seen.
And that.
Substantially improvement the Netspend.
In versus lets say the second quarter for sure, but even from the first half it traditionally the fourth quarter is the largest order and that's true for advertising.
As well.
But I truly believe that now when we are having weighting more holistic solution as Dan pointed out we've.
We've seen more and more and more and more brands that are spending more for US is in evidence we definitely looking as the K P eyes of our average deal size. This is growing and the amount of dollars are there to specific account is spending over the year and I can make.
Send that we follow closely about the different verticals and at this point, we definitely can say that the retail is a growing segment and it's a it's very helpful. Because the traditional.
Segment as cruise line airline travel.
Hotels, so on and so so far far Steve not back yet and I definitely expect that when.
We'll find their vaccine and the Corona will be and behind US those segment will be back which will create the and other boosting to our advertising revenue.
Andrew.
Okay speaking of advertising.
That segment, you break advertising and searching other into two segments here.
That showed a very strong growth so far this year, but looking into the next 12 months, where do you see the most most growth I'm talking organically now in your search for your advertising segment and and what do you believe would be driving that growth.
So we believe that the growth is definitely will come from the advertising I think that we will put a huge efforts and developing that technology I mentioned the capture and convince.
And loop that we're that we developed two which will attract brands to go after new use their capture new user and basically they have them in our owned and operated site and doing.
In the convincing efforts.
That's definitely a growth driver and a comprehensive solution that we have including CTV, which is definitely a growth driver for us and our ability.
And to integrate it into a one offering.
And as I mentioned, it's very much a play nicely with the trend that we see that both engine C. and brands are looking to reduce their number of vendors and looking for a vendor that able and capable and to provide solution on the three main dealer. This.
So show.
The search and of course, the display and there are not many like this is and you can imagine and that's definitely another growth driver. So.
I think it's all those play very well that we are expecting to see and continue to see higher growth form our advertising revenue segment.
Great. Thank you for that and I was hoping you could talk a little about the integration of pub Ocean and ER.
Like fuel and and how that how that process has been going and more specifically if you could provide some details on the synergies that disintegration would offer.
Yes, so first of all the synergy of between five ocean and content Q.
We're all looking about adding the capability of content recommendation in.
Encompass content recommendation is a way to capture audience and before the acquisition of promotion we were solidly depending on their capturing new user from Facebook and we were thinking that in order to add than it had been out there the capability of capturing we have to add.
At capturing that is based on constant recommendation. So that's that this integration plays very well.
Two what content like you is doing and its let's put it this way accretive synergistic from day, one they want of our business.
As far as the integration of content I Q into our business there the whole concept that we've been developing this is all.
Good 10 months after we announced the acquisition that was mid January is that we are working on these capture and convince and these capture and convinces gives us a way to integrate assets from the different business units and assets from Andreas on the test to dual with Fred prominent.
[noise] brands that putting their assets on our own and on on owned and operated sites. This is a one day event that gives us a great opportunity to integrated what caught fuel our search.
<unk> business is doing because we are able to integrate what we've called display to search Ed into our owned and operated sites. All in all its all has to do with a very important and development that we did.
Then we call it internally did rain, which we are able to navigate and new user after six or more minutes into different type of revenue channel.
It can be the display which comes from London Dawn. He can be displayed to search this will come from cost fuel and it can be legal action that is coming from Kentucky.
And so we are very happy because not just on the revenue that that the potential revenue that this concept can provide but also the fact that we will able to really integrate assets from the different business unit that able to optimize more.
The investment that we did on this technology.
And.
Thank you were dead wrong I have one final question, it's actually fell from Mars, a I was hoping that you could comment on the 36% tax rate in the quarter I noticed that it's much higher than the norm. So I just wanted to get a feel for what we should expect going forward and and the reasons for this tax.
In this quarter.
So there is a thought of the acquisition that we did in some other movement within the last month. There is some noise. This and then in the model and in Q2 and Q3.
Reflected he felt docs and other elements related to the acquisition. If we're looking at moving forward through the normal tuck it should get there around the 20%.
And for you know for for the full quarter and also for the next day.
Okay, great. Thanks.
Answering that question that's all I have thank you.
There are no further questions on the line at this time I would now like to turn the call back to John for any closing remarks.
Guys. Thank you very much for joining us for this call were exciting here and as I mentioned, it's a great opportunity to Texas again.
The entire they know parents employee that works really really hard to demonstrate these results in a very challenging times.
So with that I would like to thank you again, thanks, so much bye bye.
Thank you that concludes today's call. Thank you for your connection you may now disconnect.
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