Q2 2021 Twilio Inc Earnings Call

Be a question and answer session to ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star zero, I would now like to turn the conference over to Andrew City, vice president of investor relations and treasury. Please go ahead. Thanks.

Terms.

Reconciliation between our Gap and non-gaap results. And further information related to guys can be found in our earnings press release. Additionally, responses may contain forward-looking statements, which are subject to

Forward-looking statements represent our beliefs and assumptions. Only, as of the statements are made we undertake no obligation.

You never seen before to me this underscores the importance of vaccinating, the world, and I'm particularly proud of the role that twilio has chosen to play using our product. Our time, our people, and our money to help ensure Equitable, vaccines vaccinations globally. In March, we committed to the goal of helping reach, 1 billion, people with the aim of educating people and helping them get vaccinated we partnered with 450 organizations and in just 3

3 short months.

I'm proud to say our product has been used to help 297 million people's get critical vaccine education equipment or reminders in June. We also committed 10 million dollars to gavi the vaccine Alliance in support of Kovacs which is the largest global initiative to vaccinate lower-income countries. Against COVID-19, we're supporting the program's goal to purchase the distribute..1.8 billion COVID-19 vaccine dose.

Has 2 more than 90 low and middle-income countries. And we expect to have greater influence on how the Coalition uses technology to effectively distribute the vaccine. He's I was honored and surprised to find that we were the second largest private company to contribute to gavi's, Global vaccination program and the largest company in the tech sector.

As a shareholder, your part of the good work that twilio is doing. So all the trillions out there, the work you do to build our product to build this company are having an impact. So thank you it's Times Like These, when I see the impact that we can have and I'm humbled and proud to reach you and we will continue towards our goal of supporting 1 billion vaccinations worldwide. Now, I'd like to open it up for questions.

As a reminder, if you would like to ask a question, please press star. Then 1 on your telephone keypad, if you would like to withdraw your question, press the pound key.

Your first question comes from Michael turian, Wells. Fargo Securities your line is now open. Thanks everyone. I appreciate the opportunity to ask the question. I wanted to start off with what segment you mentioned in the prepared. Remarks pulled pool. Ford there in Co selling, it seems like it's maybe 6 months ahead of what you were expecting. Are there any points of feedback or interest you can share to start and maybe in tandem with that the sequential growth?

And we have a limited set of data is what is maybe a little lighter than we would have expected given just strong product synergies. That we see between the 2, is it fair to assume that shift towards Co selling? Can maybe just change the shape of that trajectory as you as you work through that going forward?

Word. I'm sure they'll take the first half of that question on the coast selling and they need to continue to talk about the growth piece, you know. Certainly as I mentioned in our previous call, you know, we are seeing interest in segments from our customers. I think across the broad segments of our customer base and we believe that by opening up segment to our entire sales force and letting combined power Book, Sales forces really educate the market as well as sell the product. We think we can really

Segment to as many customers as possible and maximize the opportunity. Very, very excited about this opportunity. I know our sales forces as well.

Hey Michael, this is the same in terms of the guide. I mean, I guess what I would say is that it may be reading a little too much into it. I think in terms of what we see for the third quarter guide ends, it's a really strong growth rate of 52, 52 percent. And I think, on top of which we remain really optimistic, about our performance in the near term as well. And, you know, we provided guidance, previously, for example, of 30% plus growth over the next 4 years and feel really, really good about that.

Over over the medium term and I think segment we'll just continue to enhance where we're going over the with the Long Count II, think my thought was more. It just seems like as you work towards Co selling, there's a reason to believe maybe the sequential growth rates could pick up their overtime at the other observation and then I'll hop off. It's just

International picked up quite significantly as well. Is that a result of some of the, on the ground focused Investments, you've been talkin about cuz name or where their specific regions to call out as contributors to drove the uptick, and, and mix there as well.

Well yeah, so okay, so 2 things there. So let me hit International first. I'd say on International the uptick that we saw there is a the benefit of our continued Global expansion is you'll recall Michael, you know, we've talked in the past about that's 1 of our Focus areas but investment on top of that, you know, those small impact from Value First. You know, we did that acquisition was very small contribution in in late March, but obviously we got a full quarter.

In Q2. And and that's a hundred percent International Revenue based on you know, the way that we classify it there, just back to your the first part of what you said. I mean, the Cosell certainly were very excited about it. And in the way that you described it won't show up in our financial, you know, for some period of time and we haven't even started, right. I mean, basically just started a few weeks ago and it'll just take some time for us to do our financials.

I appreciate all the color. Thank you.

You, your next question comes from Derek is not open.

Center or, you know what other kind of solution areas. Do you see them becoming more instrumental?

And I think, you know, we've been talking for a while now about this significant secular shift, that's taking place and how that's really driving customers towards, it's really on our customer engagement platform and we just so many things that we can do to accelerate the digital transformation. We're seeing a continuation of that.

That is your job. You know, we've always believed that it was a great fit as a builder platform for us to really flex and that kind of opportunity, I think has really been the engine. That's powered a lot of our discussions with customers with s eyes and as you see in that kind of prepared remarks and I think that's going to continue to be true. But you know this kind of production SI through the contact center building relationships is also

Opening us up to other types of customer engagement opportunities were truly. I was a part of a broader solution whether it's running marketing solution, or other types of customer engagement Solutions.

And George that. I could squeeze 1 more in your head.

So excited about the opportunity. I think we can do invest into it and we believe that there is still a large untapped opportunity and customer engagement out there in the market today.

Okay, thank you.

Your next question comes from Peter, McInnis with UBS. Your line is open.

Open about the fact that you guys saw in dollar-based net expansion rate. I'd be curious if you're seeing any interesting, mix shift Trend, yet of different products. May be driving driving up the on just messaging and then, secondly, on that, since message, and groceries, so, strong last year, can you speak to what you're seeing and hearing from customers? I guess, on the potential for mess of the messaging business business? Growth levels to be more sustainable in the back,

After this year, relative to what we've seen so far in the first half of this year.

Here. Yeah, I'll take the first part of the question Taylor. It's because an email and then I'll hand it over to George for the second part. So, in terms of the first part of the question, you're right. And we have the really fantastic growth on the messaging side of the house and we've been really excited about the progress in that product and in the way that we've been able to grow it. And in fact, you know, that product has been really accelerating over many of the prior periods. And so that that's

Secrets.

See. And, you know, you think that leads to some additional growth opportunities and other channels, I think 1 area that were equally excited about it is that our application Services revenues for those that are not associated with a telephony base cost structure, those continue to grow at accelerated levels, you know, certainly above and beyond what we see in in any of the other products. And so for example, that will include include segment and

You know, those really good problem is how I would characterize it in that, it's going to take some time to start showing up.

Yeah, I think my my answer would be very confident with what kazama's said, you know, certainly messaging even at its size and scale continues to be a strong performer for us. I think that know we talk to customers, there are still a ton of customers out there and companies that they're looking for and finding new ways and use cases to use messaging whether it's for reaching customers operations, customer, service security. So, you know, I think globally nothing is going to continue to grow as a market and

Great, thank you so much.

Your next question comes from Madame, Marshall with Morgan Stanley, your line is open.

You can do organic and inorganic lie and I want to follow up.

This is Jeff all is the question. So you know I think the way we look at it is we know what our customers where our customers want us to go in terms of our product roadmap and sometimes that manifests in capabilities that we're going to go build and sometimes it manifests in like, geographies where we're going to deepen our presence. And when we look at those, if there is a, you know, a company that has built, what we have on a road map. And if I am would accelerate our ability,

To serve our customers time to Market. So you know, that's something that we consider or, you know, we're always running it at good game board just to see what options are out there if we evaluate our roadmap and look at our options and I think it's the smart thing to do is to say, hey, our customers are calling us a road map to go here. And we are on a road map, and if there's something that actually accelerates also, a great team, great technology that can be added.

Great. Thanks. And I mean maybe,

Could be anybody but just you know as people are embarking on digital transformation initiatives, you know, clearly you're kind of still theme at BB&T. That's that's fairly similar. Just trying to get a sense of, you know, are you seeing any changes to the cohort analysis, kind of where your customers are making bigger Investments upfront or is it still, you know, I want to try out 1 product and then and then build from there just getting a sense of how you know, digital transformation in

Michigan by corporations have kind of changed the initial purchase or initial experimentation for you.

It's a short. Yeah I think that's I think that's really. I was always really thrived off of land and expand type strategy given that we work with Builders. They're still there, start with 1 use case and then they expanded of these cases. I think certainly during the height of the depend on that. Last year we saw a different set of use cases emerge and maybe a little bit more urgency around some of the some particular use cases but it doesn't really change the fundamental, you know, shape of how we work with in our customers.

Accounts. You know Tulio typically is a is a is a product that developers learn. They love they build and then they introduced to other developers and expand from there. And I think that's really the magic of the platform and something that, you know, we're going to continue to build on in the future.

Great, thank you for asking.

Your next question comes from Russia, Joe area with RBC, your line is open.

So much for taking my questions. I just wanted to ask it to 2 related questions on on Jack Webb. I guess first, I appreciate the color in the prepared remarks. Can you maybe give us a little bit more detail on the plans with the acid. And you know, there's always a general question of why buy versus build or I guess in this case partnering. So that would be helpful and then you know, in terms of the guidance, you know, I understand the puts and takes of deferred revenue right down but key

Maybe give us a general sense for what the unaffected size and growth rates look like. So we can be a little bit more accurate or my models. Thanks.

And then I'll hand. So why did we decide to acquire?

For toll free messaging in North America. And so, it points to the strength of the relationships, they have the fact that they are the only only way to get into 12 free messaging in North America. And so we just close the transaction a couple of weeks ago. So now we're starting to get to a making our joint plans of, you know, how we're going to integrate, and what that looks like. And I think there's a lot that we can do together, especially in the world of trusted communication when we think about where Communications is going all of the

As well making every call, every text message.

Coming from a trusted identity, not just some phone number, but a business name with a padlock that was like your web browser where, you know that, you know, it's trusting that when they say that they are, you know, the pharmacy or your kids school. You trust that that's true. That's the world we're building towards. That's the next big innovation and it's with great Partnerships in the entire ecosystem. With the carriers that we can execute on these big bold ideas. I think zip whip will be a big part about how we continue to evolve the ecosystem in.

Order to make the experience of actually texting and calling with each other and with businesses to be much better. You know, nowadays, you can get a text message and you don't know if it's all scientists and that's scary. It's like, is this person calling? It's a, it's a spy friend or is it Keyser Soze? Who knows who this is? And we see a world where every text every call is validated, and has that secure pants on? And I think that zip-up can be a big part about Austin, you know about this world, Trust

And I got headed over to Coke for the second part.

We're not disclosing any interested visual impacts right now. You know, it's very consistent with how we've operated with prior. Acquisitions is Jeff alluded to. We're still working through the integration plan. There's the purchase counting impacts that will have to deal with as we consolidate. And so we just walked out of our guidance, to keep it clean, and we'll obviously provide an update when we report on Q3

3 wonderful. Thank you guys.

Your next question comes from, Matt stockless with William barrier line is open.

and kind of,

Interested you're seeing and what people are looking to build with this and how you expect that opportunity to develop going forward.

An exciting addition to our platform and it's not a very big step for browsing the website. How are they using the mobile app?

It's going on right now. It's how privacy and the the moves that are going on in the world, to increase the amount of privacy that consumers have, which is a very positive thing makes it so that every company can't rely on. You know, Shady cookies and third-party data and all this stuff that you know, that consumers would like we're saying we don't want government said, I don't think. Yeah, we're not allowing it and the major platforms whether it's, you know, the browser's or iOS.

Actually cracking down on some of these tactics from yesterday years and that is forcing every company to have to get better at looking at their first party data and understand their customer and segment for a long time and taking a hard stance to say, we will only deal in first-party data. We are not going to dive into that sketchy. Realm of weird data Brokers, all this kind of stuff. And so they have a great track record as focusing on privacy enabled. Great, customer engaged.

Helping companies. Look at all their first party data and then build a better.

Journey. So, what are all the things we know about this? Customer that if we use that knowledge to engage with them, in their customer Journey, we can help them succeed and in doing so, helped the company. Better, serve its customers, and that's why I keep harping on this idea that the task of building a customer relationship is really 2 things. Number 1, it's understand. Your customer, pay attention to what they're doing with their on your website. That doesn't make any sense. You're not paying attention.

And then second guide them to that customer journey. And the way we think about this is the knowledge you have about your customer to help make them a better customer move them towards that. Ideal customer that every company thinks about then that is the intelligent that's what intelligent customer engagement work best and that's what we're helping companies build. And so I think segment Journeys is a natural step in that direction.

Allows companies to take all that information, they already use personas to build a 360 degree view of the customer and then take where the customers at maturity and layer them into segments, but then you can use to go drive, what's the next step in injured? And that's what the journeys product is doing. It's a fantastic product, it was very much conceived of in cooperation, with customers and brought to Market with customers and every step of the way showing us what they need.

Right. Got it, got it and then maybe just 1 more to follow up to the last corner, you talked about the structure of the company and kind of, you know, kind of organizations if you will.

Under 3 discrete meters. That report to me, we believe that this change will better align the business to help chileo continue to grow and scale. And we're also finding that it's enabling a greater amount of Engagement and Company disability, executive level with what's happening and driving alignment in Clarity and roadmaps more efficiently than before. And so all in all I think the change has been going well and our teams are getting greater Clarity Insight realignment, those results when you calling a company as fast as you are, you can't just keep doing the same thing.

There's always a point in time when you need to consider the org chart and get your how the orientation is changed. That's just 1 of these moments and I could be over patience. It's been well received great. Thanks again.

Your next question comes from some mods. To my know, this Jeffrey's your line is open.

Even on on zip with, I was wondering if you could maybe talk a little bit more about the Strategic value of having that direct carrier connection and I know you're not dying for a revenue perspective but anything you can give us around what. Maybe is it? What's growth looks like would be helpful just as we think about. Is that revising the acquisitions?

I can speak to the value of having direct connections. I don't think we're just closing any particular growth rate numbers or anything like that. But look in general, the, the more direct relationships, you have the better situated, you are to cooperate with the carriers and feel great. And I think that when, you know, in places, like North America, where there's 3 carriers now, and there's a lot of opportunities having those direct relationships with their tremendous desire, even watching and seeing how

I understood and then maybe just that, you know, if we if we kind of take a simplistic approach in just about an expansion in a prize revenue, from you, customers or new business is really strong in the stronger, than, if you could just give us some context around. You know what? If there's a specific area of strength in terms of revenue from new customers, was it moron, are you seeing kind of a step up in and other products just to me?

The new revenue from you customers in the quarter.

Yeah, I mean I think the way to can a 3 think about it, it's a little bit crude but basically if you take the d be any number and then you know, look at that number and and the difference between that and our organic growth rate that will give you a sense of how do customers contributed and obviously on top of that you've got the inorganic. So in general, I mean, I would say that it's broad-based strength across the board. I mean, what we're finding is that the messaging product is

Really, really done well during the last year or so, and the real acceleration that product is something that we're incredibly proud of as a company. No doubt on top of which, as I mentioned earlier, you know, we're seeing great traction as well. And you have to patient services areas of the business. You know, we've talked a lot about segment, but even in some of the other categories inclusive of flax and sendgrid as well are, you know, product, you know, we're doing really, really well. And so I wouldn't point to any 1 thing other than

to say that, you know, the messaging product in particular, has been delivering, great results, segment a great quarter, but across the board, across Industries verticals, whatever. We're just seeing broad-based strength,

Great. Appreciate you taking my questions. Thanks guys. Sure thanks.

Your next question comes from. Fred have my rhythmic, Mary. Your line is open.

How business is considered a collection?

Absolutely. This is all right Jeff and you know I'll start by saying we're really happy with the iot business. We also have just hired a new leader. Andrew Cohen who came from Samsung was a fantastic leader. And I think what we're seeing the opportunity is that especially as the world's moving to 5G. There are so many more areas that have yet to be digitally enabled in terms of physical objects in the Industrial Centre Smart, City Fence. You know, I think we as consumers think of

T is like our smart devices and our thermostats. And that is just like that is version 0.1 of what iot is really going to be about. So this is an early stage of I think that's gonna be a big outcome. And so, we're excited by what what we can bring and what's really cool about the super Sims. And again, customers let us to the observations. The problem is super Sims selves is that as you deploy a

this globally you don't want to have to have a different vendor, a different set of chips, the different set of SIM cards and and carriers behind the scenes based on where that device ends up in the world, you really want the manufacturer device once, put the same Hardware software and and connectivity is that device and ship it out to your Global supply chain. And that drastically reduces the complexity, but also it means that in the field that device can get better every day, that's the power of software. And so that's what we're seeing.

The Super Sam and a really powerful opportunity to make it. So once devices Weaver Factory hey continue their conductivity stories. In the performance. Is that kind of activity to cost us continuity, is getting better all the time because it's expensive to manufacture this. To imagine, you've got an iot, you know, humidifier or truck or Garbage dumpster or trombone. You don't want to have to remanufacture that things. Every time you get better connectivity Technologies, you want to be

The continually silently upgraded in the background, that's a super same enables companies to do because the account activity is not something with a set into the device. It is something that they can continue to evolve in the clouds. And so, we took that whole layer of conductivity, if we moved it to a software value proposition of runs in the cloud, I will say, I think I've iot world is a little challenged right now because of manufacturing and Global Supply Chain issues that we've seen in every industry. You know, it has sent back some of these iot use cases of them struggled to get.

Apply changes things. Like that's enough. And that's something I think we've seen across, you know, the industry of iot especially industrial and things like that. But I expect that that's not a durable Transit networks on the long scheme of things, the five-year-old on and the narrowband implementation based on these far less energy and that are far more oriented towards a wide breadth of devices. A much lower price, books will actually enable a whole whole slew of

Thank you.

We haven't closed the partnership yet but still pending and so a lot of that work still is forthcoming. As we close that partnership that we couldn't thank you very much.

Your next question comes from Alexander. Can you get involved research?

Help us not get ahead of ourselves to just understand the seasonal kind of patterns of that business. And I've got a quick go away.

Okay, I would say in general it is not like first day a seasonal dynamics that I would necessarily point to, I think in general, I mean, we feel great about the way that the acquisition is performing is as we've noted several times. During the course of this call, we feel quite good about, you know, the way.

I think anything that you're seeing in terms of the sequential is just a little bit of noise ups and downs from from quarter to quarter all of, which I would just expect to normalize when forward. Again we feel very optimistic about the way that that acquisition is headed and some of the things that we can do with that business. So I really wouldn't read too much into anything you think sequentially.

Okay, and then we appreciate that you guys talked about the contribution but is it possible to just get a better understanding for the Verizon a tepee fees? Maybe this will be our last quarter so we can because if you, if we do the math, it does look like the underlying growth organically X Theta p is accelerating q1 to Q2, but I'd love to just understand a little bit better if that's actually the case.

I mean, I think in general that's that's the case. I think we're not really breaking Verizon out anymore. I mean, it's kind of in the base rate and as we look at comparisons from last year to this year, it's Apples to Apples. Which is why, you know, we've broken out the AT&T and T-Mobile aspect only and we've obviously giving you a number there, as well. But yeah, if you were to take all of that stuff out, what you would see is that we're doing very nicely organically.

And that there is in there.

Thank you guys.

Your next question comes from. Brent Declan with vipers Hunter, you line is open Frank. You got a question for George F. On demand for two-way messaging via Toyota conversations versus traditional 1 Way SMS messaging API to know. In the highlighted a couple of conversation use cases. What is the benefit to the model? Is customers, move from SMS to conversations that price.

Early higher volumes or does it also include higher pricing and really just trying to understand how fast could the industry moved. There's personally nothing more frustrating to me as a consumer, then to get a text from a brand without the ability to actually reply back. And so certainly encouraged to see conversations being brought up more, but love to get any color on adoption. And how that would change the messaging volumes for Toyota. Well,

the strategy of how companies are going about adding messaging to their product experiences, you know, natural first

Companies are expecting is to be able to reach a person or system and answers a question and that's why we've been focusing on products like conversation. So I can turn those when we messages and could see a conversation. And then on top of conversations in the contact center,

Someone else in the field.

And companies wants to be a part of those conversations to, they want to be a part of that relationship. And that relationship is not transactional, or it's not just a bunch of alert, it's actually a two-way dialogue. And I think that we're gonna look back and look and see that history of conversation that you have with a company that starts to become the new customer relationship is right there and that's right. And that's what helping companies create if I was talking to a major financial services company recently, and they really saw that vision of that, so we can build relationships and so

I think that's a common conversation that I'm having with the executives at many companies who really see that future coming and we're helping them to live their own reflection in the conversations and all the things will work out.

Your next question comes from a bell tower with beard your language open.

And okay. Great, thanks for your 2 questions. First, I think probably for like, I guess first, thanks for all the couple days. Vaccination efforts, obviously, great to see when asked about twilio live. It was mentioned in the prepared remarks. I just want to understand how the market that's trying to address any kind of early use cases you could point to, and we're just kind of how you're thinking about the opportunity for that product.

Absolutely. Thanks. Will you know, if you think about what is happening, you know, the first use cases for live media on the internet. Where largely, you know, wonder wonder, wonder if you and now we're seeing the number of use cases for broadcast scale live experiences really grow. A lot of that is because it's interesting.

Live interactive videos with many, many, many people. And so, truly alive is the answer to this Emerging Market of live, interactive to the Arab Spring, okay? Starting to see things like Commerce opportunities. Online with live video, you've got the whole audio markets, 1 of our launch customers for that was a Reddit talk. So read it wanted to add voice talk features into their communities, and so used to tour the lives to do that. And so those are what was 1 of the reference customers the time of launch and we're just seeing

I mean I think there's what the very beginning of a lot of you experimentation to okay live media on the internet. Not just you know, 1.2 2.1, 2.3, 1.2 5 but actually at scale like broadcast scale. But interactive, it's actually starting to become a reality, and I think COVID-19 accelerated along the experimentation to what's possible. And so we're looking forward to Howard many of those new ideas, including, for example, Reddit,

Okay, that's great, thanks for that color. I and then I guess, maybe, just for any thoughts about how to frame, the gross margin Outlook as we head into Q3, I guess you'll have a full quarter impact of the hup fees. But but you know, aside from that any other puts and takes to be thinking about help us kind of model, that moving forward,

You're not really well I mean I wouldn't say there's any real change and our our long-term framework around gross margins. I mean you know we're still targeting 60 to 65 percent. We not really ever been focused on a per se in, in the short term and you know, there's there's some noise in here, obviously there's our messaging product which we feel great about the fact that it's had such a strong performance. But Nick's is the sound a little bit, obviously, International and increases their from 29 to 32.

And then the feast quote, this a little bit but I wouldn't, I wouldn't say that.

Nothing really good. Kind of in the different in the long-term Outlook in the way that we're thinking about it.

It. Okay. Thank you.

Thanks for taking my question. I just want to dig into the flex adoption and contact center and also, I'm wondering how are you looking at the cloud contact center opportunity? Now giving the UK's vendors and there's kind of convergence of ucaas and seek as render, you know, it with recent consolidation how we looking at the opportunity there.

So first of all, thanks for the question. We're really happy with how it's going. Yeah, I know. We don't break it out separately, but if you looked at Flex independently, I think you'd look at its momentum to say, it's 1 of the fastest growing fast products on the market. And I'm particularly proud of the fact he's got the wide berth, a customer adoption that we have from the digital disruptors. You know, that we saw early in the adoption cycle, Shopify lift, Robin Hood through, the Fortune, 500 incumbents, and the mortgage who are adopting flexes well, like, the major

Or are we arms or today is a major retailer or the Philippine Airlines, right? And so, we're seeing broad adoption by a wide set of companies really happy with it. Now, for the second part of your question, about the greater crimes that are going out look, I was guessing someone would ask that question first, the market is still in the early stages of moving to the cloud. It's only around 15 percent or so of the market that in the market give or take is still on come on.

It's about looking at it but big opportunity but I also think the combination of like you cast and contact centers is interesting when accessing the market changing a little bit. I think that you cast is typically thought of as a consequence of the desks office and we're seeing the contact center becomes much more of a

Customer experience, customer engagement points. It and it's becoming closer to the residues on your business. How do we serve customers as opposed to the cost center? How do we save my life? And so it used to be that. I T and the cost center side of the business was like they use in the contact center but I actually think that when looking at digital channels and serving customers over these digital channels, the nature of the contact center is changing from that it cost center.

To something that's much closer to the revenue and the chief digital officer. The thing that is going to drive, happy customers, repeat customers, and more business. And so, I think that's a trend that were too attached to given the are the products given where we sit and who we sell to inside.

Thanks for the color.

Your line is open.

What's a good Circle back to your International Revenue, strength and characterize the adoption of Digital customer engagement across these different customer sets. You know, how do you view the international markets relative to the u.s. in terms of adoption there? You see some of the more advanced in the US or they are playing catch-up? Thank you.

This is George and I think it really depends on the the technology I would say for any of our Technologies, like, you know, SMS email to Italy, you know, more of America is at parity or head of any, any other place I would argue, but, you know, some of other platforms like, WhatsApp. We definitely have seen word dance adoption in summer International Market, so I think it really depends on the part of the portfolio.

That's helpful. Thanks, appreciate it.

Your last question comes from Mark Murphy with JPMorgan, your line is open.

Congrats, Jeff. I wanted to ask you about the potential for a new kind of an app that would connect Frontline workers with consumers. And you, we understand there are more non desk workers is the world and desk workers. So understanding is still early. How do you see that product progressing? And did you feel like you've been able to, you know,

You build some pretty good pipeline in that area.

Yeah, yeah, thanks Mark. So that is 1 of the observations that we launched the product with which is that there are more non desk workers than there are desk workers. And I think an interesting thing that we've also observed about the market is that there are there's 2 types of human basically who interact with the customers that most businesses..1 are people who sit usually in a place and all they do is interact with customers. That's usually what you call the call center. So the contact center, you know, maybe they're in a, you know,

Building with cubicles and maybe now they're sitting at home. But basically, they take call after call after call or 10, if you try to remember, right? And what we're seeing in front line, is that

But he gets to track and ensure compliance with all those Communications are going through that experience with the post their summer, just use their their mobile phone in their native, personal phone numbers. Actually contains customer. So, we're seeing a lot of interesting areas use cases and types of companies really excited because the company that we're able to talk about today, the health care company that was using Frontline for sales Communications. And I think they're the product is even GA yes, but to have a major Fortune, 500 health care company already has

Adding to the play Frontline. I think indicates that there are broad set of use cases that we're seeing from, not just them. But other companies, as well, that will set was these Frontline workers need to be empowered with great customer engagement tools less. They just do it less effectively in a nun compliant way using their personal songs and I think there were just scratching the surface and that's anything that chronic a GI

Thank you so much. Jeff and quick 1 for a quick game up..8 PCS. Did you think the carriers who have increases? These are sort of 1 and done with the increases, or is there a chance that the be some kind of some ongoing lift? There is a seizure and just, I guess I'm inferring from the strength of results that it's pretty comfortable in terms of customers absorbing that costs. Just because the, the RO

Oh, I get so high. Is that a fair way to think about it?

Yeah, I mean, I think the the ROI is incredibly High when you think about the things that we're doing with customers to be able to enable their use cases, it's hard for me to say 1 way or the other as to whether or not. It's 1 of the I mean, certainly based on what we know and see today, we don't see anything in the future but it certainly doesn't preclude them. I doing something else. But you know, all of our financial modeling is not based on any additional fees at this time.

I'm thank you very much. Thanks much.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating in our disconnect.