Q3 2022 Digital Turbine Inc Earnings Call
Good afternoon, and welcome to the digital turbine fiscal 2022 third quarter financial results Conference call.
Speaker 1: Good afternoon and welcome to the Digital Turbine Fiscal 2022 Third Quarter Financial Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.
All participants will be in listen only mode.
Should you need assistance. Please signal a conference specialist by pressing the star key followed by zero.
Speaker 1: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your telephone keypad. To withdraw your question, please press star then 2. Please note, this event is being recorded. I would now like to turn the conference over to Brian Bartholomew, Senior Vice President of Capital Markets. Please go ahead.
After today's presentation there'll be an opportunity to ask questions to ask a question you May Press Star then one on your telephone keypad to withdraw your question. Please press Star then two please note. This event is being recorded.
I would now like to turn the conference over to Brian Bartholomew Senior Vice President of capital markets. Please go ahead.
Speaker 2: Thank you, Gary. Good afternoon and welcome to the Digital Turbine fiscal 2022 third quarter earnings conference call.
Thank you Gary Good afternoon, welcome to the digital turbine fiscal 2022 third quarter earnings Conference call.
Speaker 2: Joining me on the call today to discuss our results are CEO Bill Stone and CFO Barrett here.
Joining me on the call today to discuss our results are CEO , Bill stone and CFO Barrett garrison.
Speaker 2: Before we get started, I'd like to take this opportunity to remind you that our remarks today will include forward-looking statements.
Before we get started I'd like to take this opportunity to remind you that our remarks today will include forward looking statements.
Speaker 2: These forward-looking statements are based on our current assumptions, expectations, and beliefs, including projected operating metrics, future products and services, anticipated market demand, and other forward-looking topics.
These forward looking statements are based on our current assumptions expectations and beliefs.
Including projected operating metrics future products and services.
Dissipated market demand and other forward looking topics.
Speaker 2: Although we believe that our assumptions are reasonable, they are not guarantees of future performance, and some will inevitably prove to be incorrect.
Although we believe that our assumptions are reasonable they are not guarantees of future performance and some will inevitably prove to be incorrect.
Speaker 2: Except as required by law, we undertake no obligation to update any forward-looking statements.
As required by law, we undertake no obligation to update any forward looking statements.
Speaker 2: or discussion of the risk factors that could cause our actual results to differ materially from those contemplated by our forward-to-key statements, please refer to the documents we file with the Securities and Exchange.
For a discussion of the risk factors that could cause our actual results to differ materially from those contemplated by our forward looking statements. Please refer to the documents we filed with the Securities and Exchange Commission.
Speaker 2: Also, during this call, we will discuss certain non-GAAP measures of our performance.
Also during this call we will discuss certain non-GAAP measures of our performance.
Speaker 2: Non-GAT measures are not substitutes for GAT measures. Please refer to today's press release for important information about the limitations of using non-GAT measures, as well as reconcilations of these non-GAT financial results to the most comparable GAT measures. Now we'll turn the call over to our CEO , Mr. Bill Stone.
non-GAAP measures are not substitutes for GAAP measures. Please refer to today's press release for important information about the limitations of using non-GAAP measures as well as reconciliations of these non-GAAP financial results to the most comparable GAAP measures.
Now I will turn the call over to our CEO , Mr. Bill Stone.
Yeah, Thanks, Brian and thank you all for joining our call Tonight.
Speaker 3: First, I want to formally recognize the amazing hustle and effort of our combined 1DT team. This is our second earnings call, announcing a full quarter of results as one-digital turbine. And I'm proud of being part of such an amazing team that is successfully scaling together so quickly.
First I wanted to formally recognize the amazing hustle and effort of our combined <unk> team. This is our second earnings call announcing a full quarter of results as one digital turbine.
And I am proud of being part of such an amazing team that is successfully scaling together so quickly.
Speaker 3: I also want to welcome Molly Spillman, who officially joined our Board of Directors last week.
I also want to welcome Mollie Spilman, who officially joined our board of directors last week.
Speaker 3: Molly's deep ad tech mobile and cloud experience will be helpful as we scale and grow our
Molly steep AD tech mobile and cloud experience will be helpful. As we scale and grow our company.
Speaker 3: Tonight we're going to focus on our December results and our near term forward outlook.
Today, we're going to focus on our December results and our near term forward outlook.
Speaker 3: As a reminder, we hosted an analyst day in November where we discussed our longer term outlook and strategies and how we planned to build DT into a $4 billion top line and $1 billion bottom line business.
As a reminder, we hosted an analyst day in November where we discussed our longer term outlook and strategies.
And how we plan to build <unk> into a 4 billion top line and $1 billion bottom line business.
Speaker 3: For investors that want to better understand our longer term approach, I'd encourage you to go to our website without replay as available.
For investors that want to better understand our longer term approach I'd encourage you to go to our website where that replay is available.
For our near term results I'm going to break my remarks into four areas.
Speaker 3: For a near-term result, I'm going to break my remarks into four areas.
Speaker 3: First is some commentary on our consolidated results for the quarter, including a breakout of each of our segments. Second or some real time.
First just some commentary on our consolidated results for the quarter.
Including a breakout of each of our segments.
Second our some real time operational updates.
Speaker 3: Thirdly, we'll update on the strategic integration progress of one digital turbine. And finally, provide some commentary on the current events going out in our industry and economy, such as regulations, supply chains, inflation, apples, IDFA impact, and others.
Thirdly, we will update on the strategic integration progress of one digital turbine and finally provide some commentary on the current events going on in our industry and economy, such as regulations supply chain inflation apples <unk> impact and others.
Okay.
For the December quarter, we delivered just over $375 million in revenue and $57 million in EBITDA.
Speaker 3: For the December quarter, we delivered just over $375 million in revenue and $57 million in EBITDA.
Speaker 3: Compared to the December quarter of last year, this represents over a 300% increase on an as reported basis, and nearly a 40% increase on a performance basis for revenues.
Compared to the December quarter of last year. This represents over a 300% increase on an as reported basis and nearly a 40% increase on a pro forma basis for revenues and.
Speaker 3: And more than 150% increase in EBITDA on a reported basis. And nearly a 50% increase in EBITDA on a performance base.
And more than 150% increase in EBITDA on a reported basis and nearly a 50% increase in EBITDA on a pro forma basis.
Speaker 3: I was most pleased to see the operating leverage of the model with our combined entity, as we were able to deliver strong revenue growth while holding operating expenses flat year over year.
I was most pleased to see the operating leverage of the model with our combined entity as we were able to deliver strong revenue growth, while holding operating expenses flat year over year.
Speaker 3: As we've said on prior earnings calls, the ability for us to grow the top line faster than the expenses required to support it validates the profitability of our platform.
As we've said on prior earnings calls the ability for us to grow the top line faster than the expenses required to support it validates the profitability of our platform.
Speaker 3: To support this point, I want to call out our all-time record of $57 million of EBITDA, generated from the December quarter, as proof of this strong operating dynamic and the health of our overall business model.
To support this point I want to call out our all time record of $57 million of EBITDA generated from the December quarter as proof of the strong operating dynamic and the health of our overall business model.
Speaker 3: Turning to the segment results, this will be the final quarter that we break our results into our three segments of on-device media ad-connion fiber. We did this approach for the past year, given the historic public company comps for all three companies that could easily provide a pro forma, apples-to-apples basis for investors.
Turning to the segment results. This will be the final quarter that we break our results into our three segments of our device media at colony in fiber we.
We did this approach for the past year, given the historic public company comps for all three companies that could easily provide a pro forma apples to apples basis for investors.
Speaker 3: But as we begin, as we begin our new fiscal year on April 1st, and we've now integrated our companies together, we will begin breaking out our business into two segments.
But as we can as we begin our new fiscal year on April one and we've now integrated our companies together, we will begin breaking out our business into two segments.
Speaker 3: Our on-device business comprised of our app media, content media, and single-tap business.
Our on device business comprised of our App media content media and single tap business.
Speaker 3: And our app growth platform business comprised of our fiber ad colony and non-single tap appreciate DSP business.
And our App growth platform business comprised of our fiber at colony and non single tap appreciate DSP business.
Speaker 3: This will allow us the best of all worlds in finding the right balance between a greater focus on our customers, our ability to simplify, and our ability to accelerate our synergy.
This will allow us to the best of all worlds in finding the right balance between a greater focus on our customers our ability to simplify and our ability to accelerate our synergies.
Speaker 3: We've recently completed a restructuring of our organization to align with these new segments.
We've recently completed a restructuring of our organization to align with these new segments.
Speaker 3: I'm pleased to announce that we have appointed Mike Ng, our former DT Chief Revenue Officer, as president of our APRO's platform business.
I am pleased to announce that we have appointed Mike King our former DT Chief revenue officer, as president of our App growth platform business.
Speaker 3: and hired TELCO and AdTech Industry Veteran Matt Gillis to be our president of our on-device business.
And hired telco and AD tech industry veteran Mac Gillis to be our president of our on device business.
Both leaders have P&L responsibility for their respective segments and are supported by a shared service infrastructure team to ensure we get all the <unk> synergy benefits.
Speaker 3: Both leaders have P&L responsibility for the respective segments and are supported by a shared service infrastructure team to ensure we get all the one DT synergy benefit.
Speaker 3: We're using this current March quarter to make the transition from our three segment to two segment approach as we begin the next fiscal year.
We're using this current march quarter to make the transition from our three segment to segment approach as we begin the next fiscal year.
Speaker 3: Turning to our December quarterly segment results, our on-device media business set all-time revenue records.
Turning to our December quarterly segment results are on device media business set all time revenue records.
Speaker 3: and generated over $134 million in revenue, which is 43% growth year-to-year.
And generated over $134 million in revenue, which is 43% growth year over year.
Speaker 3: Driving the strong organic growth was strong performance in our content media, ad media, and single-tap business.
Driving this strong organic growth with strong performance in our content media at media and single tap business.
Our revenues for the <unk> device business in the last three December quarters have gone from $55 million in 2019 $93 million in 2020 and $134 million this past quarter.
Speaker 3: Our revenues for the on-device business in the last three December quarters have gone from 55 million in 2019, 93 million in 2020, and 134 million this past quarter.
Speaker 3: We're happy to see such strong organic growth driven by improved revenue per device and accelerating device growth.
We're happy to see such strong organic growth driven by improved revenue per device and accelerating device growth.
Speaker 3: In the December quarter, we saw over 68 million devices integrated with DT software, which is an all-time record.
In the December quarter, we saw over 68 million devices integrated with <unk> software, which is an all time record.
Single tap has been a major driver of the strong topline results.
Speaker 3: Single tap has been a major driver of the strong top line result.
Speaker 3: After trying for many years, we proved in 2021 there's a real business with single tap as the growth broke out in a major way as revenues increased 800% year over year.
After trying for many years, we proved in 2021, there's a real business with single tap as the gross the growth broke out in a major way as revenues increased 800% year over year.
Speaker 3: Now as we turn to 2022, we are focused on four main areas for future single-tab growth that's comprised of optimizing performance for our existing advertisers.
Now as we turn to 2022, we're focused on four main areas for future single tap growth that's comprised of optimizing performance for our existing advertisers.
Speaker 3: Increasing the number of advertisers on the direct platform or DSP that we purchased from appreciate.
Increasing the number of advertisers on the direct platform or DSP that we purchase from appreciate.
Speaker 3: Third is the licensing of the technology as more of a staff's like-played and finally is getting single-tap on more global devices.
Third is the licensing of the technology is more of a SaaS like play and finally as getting single tap on more global devices.
Speaker 3: I'm pleased to report that we made progress in the quarter on all fronts as we increased the number of active direct advertisers to approximately 50 and are working with multiple tier one partners on licensing single tap more broadly. As mentioned earlier in my remarks, we also added 68 million new devices in the quarter.
I am pleased to report that we made progress in the quarter on all fronts as we increase the number of active direct advertisers to approximately 50 and are working with multiple tier one partners on licensing single tap more broadly as mentioned earlier in my remarks, we also added 68 million new devices in the quarter.
Speaker 3: But in addition to the strong single-tap growth, revenue per device or RPD grew nearly 50%.
But in addition to the strong single tap growth revenue per device or RPT grew nearly 50%.
Speaker 3: RPD is a core health metric of our business as it showcases the value of our platform to advertisers and the customers.
Our PD as a core health metric of our business as it showcases the value of our platform to advertisers and the customers.
Speaker 3: And finally, it is important to note that this is all organic growth and now with our synergies from our acquisitions and continued expansion with new and existing partners give us optimism on the future growth prospects for our odd device business.
And finally it is important to note that this is all organic growth and now with our synergies from our acquisitions and continued expansion with new and existing partners give us optimism on the future growth prospects for our device business.
Speaker 3: Turning to our ad colony segment, ad colony rebounded strong from the September quarter with 53 percent sequential growth and 28 percent year-over-year growth comparing the December quarter to last year.
Turning to our AD colony segment add Tony rebounded strong from the September quarter, with 53% sequential growth and 28% year over year growth comparing December quarter to last year.
Speaker 3: In particular, the AdCone brand business, which is highly strategic for one digital turbine efforts, showcased approximately 35% your over your growth.
In particular, the <unk> brand business, which is highly strategic for our one digital turbine efforts showcased approximately 35% year over year growth.
Speaker 3: The performance business, which it contracted in the prior September quarter by 18%, primarily driven by Apple's IDFA changes, rebounded nicely with nearly 25% growth in the December quarter.
The performance business, which would have contracted in the prior September quarter by 18%, primarily driven by apples <unk> changes rebounded nicely with nearly 25% growth in the December quarter.
Speaker 3: We continue to be excited with the expanding new brand relationships and multiple industries with new tops here in names such as Proctor and Gamble, Disney, CVS, and Progressive Insurance, just to name a few.
We continue to be excited with the expanding new brand relationships in multiple industries with new top tier names, such as Procter and Gamble Disney Cvs and Progressive insurance just to name a few.
Speaker 3: Attorney to fiber, fiber's full quarterly results were impressive, showcasing your over your growth of nearly 50%.
Turning to fiber fiber full quarterly results were impressive showcase in year over year growth of nearly 50%.
Speaker 3: Even more impressive is Fibres EBITDA increased to over 150% year-over-year.
Even more impressive is fibers EBITDA increased over 150% year over year.
In other words fiber is not only accelerating growth on the top line, but it's now at that critical inflection point of scale that enables accelerated operating leverage in the core business.
Speaker 3: In other words, fiber's not only accelerating growth on the top line, but it's now at that critical inflection point of scale that enables accelerated operating leverage in the core business. The
The impressive growth was driven by both rates and volumes.
Speaker 3: I'm raised during the December quarter, Bibersot ECPMs approve across all ad formats three years ago, while increasing impressions by over 40%.
On rates during the December quarter fiber saw <unk> approved across all AD formats to a year ago, while increasing impressions by over 40%.
More specifically.
Speaker 3: More specifically fueling and strong growth was marketplace video and our APAC region, which were both up over 100% year-to-year.
Typically fueling our strong growth was marketplace or video and our APAC region, which were both up over 100% year over year.
So with that Tonys fiber had made strategic investments in video rendering of mobile ads over the past few years and are now capitalizing on the macro global tailwind of video AD formats as advertisers prefer the stickier richer and more pricing elastic AD format compared to other traditional digital formats.
Speaker 3: Both ad-connious fiber had made strategic investments in video rendering of mobile ads over the past few years and are now capitalizing on the macro-global tailwind of video ad formats as advertisers prefer the stickier, richer, and more price-in-elastic ad format compared to other traditional digital formats.
Speaker 3: And for our ad colony and fiber businesses, we saw combined A-PAC revenues grow by over 90% year-over-year.
And for our <unk> and fiber businesses, we saw combined APAC revenues grow by over 90% year over year.
Speaker 3: While it's still a small percentage of overall revenues at approximately 15% of our total ad colonies fiber revenues, but we add more synergies and devices in the region, we're excited about the growth prospects in that part of the world.
While it's still a small percentage of overall revenues at approximately 15% of our total add Tony fiber revenues, but as we add more synergies and devices in the region. We're excited about the growth prospects in that part of the world.
Speaker 3: and finally on our segment results, where beginning to increase our focus on revenue synergies.
And finally on our segment results were beginning to increase our focus on revenue synergies are.
Speaker 3: Our synergy revenue run rate approached 10% of overall revenues as we exited the quarter. We're working on over a dozen different revenue synergies between the companies, whether it has ad colonies demand on fiber supply, appreciate buying on fiber supply, or expanding ad colonies demand reach with our DT content media products, just to name a few examples. In addition to the revenue,
Our synergy revenue run rate approach, 10% of overall revenues as we exited the quarter.
We're working on over a dozen different revenue synergies between the companies whether it is add colonies demand on fiber supply I appreciate buying on fiber supply or expanding AD counties demand reach with our DT content media products just to name a few examples.
In addition to the revenue dis synergies create.
Speaker 3: Many of these synergies also improve our gross margins, while simultaneously delivering more value for our partners by taking unnecessary links out of the supply chain of digital advertising.
Many of these synergies also improve our gross margins, while simultaneously delivering more value for our partners by taking unnecessary links out of the supply chain of digital advertising.
Speaker 3: This is a major strategic focus area for our team to accelerate our progress here.
This is a major strategic focus area for our team to accelerate our progress here.
Speaker 3: Turning to our forward outlook, I want to provide some commentary on how we're positioned for continued growth.
Turning to our forward outlook I want to provide some commentary on how we are positioned for continued growth.
Speaker 3: Where their acquisitions are growth levers of devices, products and media have that change. They've just been accelerated and expanded.
With our acquisitions, our growth levers of devices products and media had that change they've just been accelerated and expanded.
Speaker 3: First on devices, we've now passed over 800 million devices that our software has been installed on, including 68 million in the December quarter.
First on devices, we've now passed over $800 million devices that our software has been installed on including 68 million in the December quarter.
Speaker 3: We're excited to begin working with new partners, such as Oppo and Vivo, and are also excited to be an expanding further with existing partners such as Samsung and Telefonica.
We're excited to begin working with new partners, such as auto and vivo and are also excited to begin expanding further with existing partners such as Samsung and Telefonica.
Speaker 3: On the product front, our revenues from dynamic installs grew by over 20% year-over-year in the December quarter, but now only represent 15% of our total consolidated revenues compared to over 50% last year. As the company's been repositioned to a monetization over the life of the device company, versus just a monetization at first activation company.
On the product front, our revenues from dynamic installs grew by over 20% year over year in the December quarter, but now only represent 15% of our total consolidated revenues compared to over 50% last year as the company has been repositioned to a monetization over the life of the device company versus.
Just a monetization at first activation company.
Speaker 3: Our revenues that occur over the lifetime of a device now represent approximately 85% of our total revenues compared to just about 50% last year.
Our revenues that occur over the lifetime of a device now represent approximately 85% of our total revenues compared to just about 50% last year.
Speaker 3: diversifying away from revenues only attributable to first boot and monetizing over the life of the device has been a strategic priority for our business and this progress is material.
Diversifying away from revenues only attributable to first boot and monetizing over the life of the device has been a strategic priority for our business and this progress is material.
Speaker 3: I mentioned single tap as a major growth driver earlier in my remarks, but we are also looking to drive growth in many other products, such as notifications, discover bar, fair bit, offer wall and marketplace.
I mentioned single tap as a major growth driver earlier in my remarks, but we are also looking to drive growth in many other products such as notifications discover bar fair bid offer wall in marketplace.
Speaker 3: As a simple example, our Smurfolder product grew by over 300% year over year.
As a simple example, our smartphone product grew by over 300% year over year.
Speaker 3: In other words, diversification is working well to drive both top line growth and we don't have reliance on any single product to drive growth.
In other words diversification is working well to drive both topline growth and we don't have reliance on any single product to drive growth.
Speaker 3: And to further emphasize this point, this is now our second consecutive quarter where we do not have a single partner or customer that constitutes more than 10% of our revenues.
And to further emphasize this point. This is now our second consecutive quarter, where we do not have a single partner or customer that constitutes more than 10% of our revenues.
I now want to turn to our integration updates.
Speaker 3: With the completion of the acquisitions, we've now successfully assembled the key pieces for our full stack and an ad-seq platform.
With the completion of the acquisitions, we've now successfully assembled the key pieces for our full stack and AD Tech platform.
Speaker 3: Last quarter, I spent time in my prepared remarks discussing the strategy of how we're going to win. And tonight, I want to spend some time on the operational element.
Last quarter I spent time in my prepared remarks discussing the strategy of how we're going to win and Tonight I want to spend some time on the operational elements.
Speaker 3: We already discussed the organizational segments early in my remarks. So the first area I'd like to discuss is our Google relationship.
We already discussed the organizational segments earlier in my remarks, so the first area I'd like to discuss is our Google relationship.
Speaker 3: Our first material milestone in leveraging our scale was our strategic announcement with Google. Our Google announcement has three primary benefits. First is a-
Our first material milestones in leveraging our scale was our strategic announcement with Google.
Our Google announcement has three primary benefits.
First is the financial benefit of our hosting agreement.
Speaker 3: We expect this to yield material cost savings over the next few years. And secondly, is the commitment by Google to work with us across their businesses, including the Android group.
We expect this to yield material cost savings over the next few years and.
And secondly is the commitment by Google to work with us across our businesses, including the Android group.
Speaker 3: We've already begun working with Google on a variety of operational and strategic areas into the future.
We've already begun working with Google on a variety of operational and strategic areas into the future.
Speaker 3: And finally, is credibility. We understand that Google has been viewed as an existential threat by many to our business, and hopefully hearing from Google in their own words helps mitigate any of those concerns.
And finally as credibility.
We understand that Google has been viewed as an existential threat by many to our business and hopefully hearing from Google in their own words helps mitigate any of those concerns.
We've been focused on integrating new systems like common HR accounting sales force and technology platforms. So we can operate like one versus four companies.
Speaker 3: We've been focused on integrating new systems like common HR, accounting, sales force, and technology platforms so we can operate like one versus four companies.
Speaker 3: Combined with that is also focusing on unifying our processes, like how we work on new clients, manager of people, and manage our customer account.
Combined with that is also focused on unifying our processes like how we work on new clients manage our people and manage our customer accounts.
Speaker 3: These things all allow us to operate more efficiently so we can capitalize on the future strategy.
These things all allow us to operate more efficiently. So we can capitalize on the future strategy.
Speaker 3: I want to highlight this to investors to showcase how proud of this I am from the team.
I want to highlight this to investors to showcase how proud of this I am from the team.
Speaker 3: Very few companies can walk in Chugum by simultaneously executing the present while doing all the necessary work to prepare for the future, especially when dealing with COVID fatigue that we're all experienced.
Very few companies can walk and chew gum by simultaneously executing the present, while doing all the necessary work to prepare for the future, especially when dealing with COVID-19 fatigue that we're all experiencing.
Speaker 3: To close out my preparatory marks, I wanted to reiterate my commentary from last quarter on the macro and industry specific events happening real time.
To close out my prepared remarks, I wanted to reiterate my commentary from last quarter on the macro and industry specific events happening real time.
Speaker 3: First on the macro environment, one of the great things about our business as a cloud-based mobile software company is we don't have input or hard costs.
Yeah.
First on the macro environment, one of the great things about our business as a cloud based mobile software company as we don't have input or hard costs.
Speaker 3: Thus, our exposure to supply chains and inflation risks is extremely low relative to other organizations.
Thus our exposure to supply chains and inflation risks is extremely low relative to other organizations.
Speaker 3: On the regulatory front, we are seeing legislation around the globe about regulating big tech firms to offer more consumer choice in control.
On the regulatory front, we are seeing legislation around the globe about regulating big tech firms to offer more consumer choice and control.
Speaker 3: In particular here in the United States, Bill S2710, or also known as the Open App Markets Act, received a 21-to-1 bipartisan vote from the Senate Judiciary Committee this last past week as a strong endorsement to continue to proceed through the legislative process.
In particular here in the United States Bill S. Two seven <unk> or also known as the open App markets Act received a <unk> 21 to one bipartisan vote from the Senate Judiciary Committee. This last past week as a strong endorsement to continue to proceed through the legislative process.
Speaker 3: This would deep bundle the Google and Apple app stores from the operating system and offer consumer choice of which app stores and apps consumers can select.
This would deep bundle, the Google and Apple App stores from the operating system and offer consumer choice of which app stores and apps consumers can select.
From a <unk> perspective, we are closely monitoring these regulations and have already partnered and supplied input to regulatory authorities.
Speaker 3: From a DT perspective, we are closely monitoring these regulations and have already parted and supplied input to regulatory authorities.
Speaker 3: Given our unique position with operators and OEMs, we see today's regulatory environment as a tailwind, not a headwind for our business.
Given our unique position with operators and Oems, we see today's regulatory environment as a tailwind not a headwind for our business.
Speaker 3: For investors interested in more details on these dynamics and what they potentially mean for us, I'd encourage you to listen to our comments we made at our analyst day in November , which are available on our website.
For investors interested in more details on these dynamics and what they potentially mean for US I would encourage you to listen to our comments, we made at our analyst day in November which are available on our website.
Speaker 3: Turning to Apple's iOS platform and the impacts of IDFA. I want to first emphasize for investors that our Android share continues to grow and is now over 70% of our total revenue.
Turning to Apple's iOS platform and the impacts of <unk> I want to first emphasize for investors that our Android share continues to grow and is now over 70% of our total revenues.
Speaker 3: But even with this mixed shift to Android, we saw a return to iOS growth in the December quarter.
But even with this mix shift to Android, we saw return to Io iOS growth in the December quarter.
Speaker 3: RIOS revenues grew 33% sequentially and 20% year-over-year, which demonstrates that IDFA has not been a material headwind for our business.
Our iOS revenues grew 33% sequentially and 20% year over year, which demonstrate that idea.
<unk> has not been a material headwind for our business.
Other larger players that are relying upon <unk> for things like view through attribution had been hit hard by Apple's changes, but these factors are not relevant for our business.
Speaker 3: Other larger players that are relying upon IDFA for things like view through attribution have been hit hard by apples changes, but these factors are not relevant for our business.
Speaker 3: If anything, IDFA has leveled the plane field versus providing disproportionate advantages to the MEGA TAP tech players.
If anything <unk> has leveled the playing field versus providing disproportionate advantages to the Mega cap Tech players.
Speaker 3: We already support Apple's SK ad network integration, also known as SCAN, and our machine learning models improve on device decisioning for players like us.
We already support Apple's FK AD network integration also known as scan and our machine learning models improve on device Decisioning for players like us.
Speaker 3: However, what we believe makes us different from others is our concentration of brand dollars from AdCone that work both on iOS and on Android and tend to be a bit more price and elastic. Our majority focus on Android and our capabilities with single tap.
However, what we believe makes us different from others is our concentration of brand dollars from AD colony that work, both on iOS and on Android and tend to be a bit more pricing elastic or majority focus on Android and our capabilities with single tap.
Speaker 3: And finally, before I turn over to Barrett, I want to make a comment about the market. Our jobs to execute on our winning strategy and our enormous, addressable market in front of us. That's what we can control.
And finally before I turn it over to Barrett I want to make a comment about the market our jobs to execute on our winning strategy and our enormous addressable market in front of us that's what we can control.
Speaker 3: But we are living in a time where investors seem to put companies into a growth bucket or a value bucket. We are very proud in our ability to deliver both significant growth, but simultaneously deliver profitability that's growing even faster than our top line.
But we are living in a time, where investors seem to put companies into our growth bucket or value bucket.
We are very proud in our ability to deliver both significant growth, but simultaneously deliver profitability, that's growing even faster than our top line.
Speaker 3: With that, this concludes my preparatory marks and I'll turn it over to Barrett to take you through the numbers.
With that this concludes my prepared remarks, and I'll turn it over to Barrett to take you through the numbers.
Speaker 4: Thanks, Bill. And good afternoon, everyone. We're pleased to announce a strong third quarter performance across all our business lines and also to provide our outlook for growth for the balance of the fiscal 2022.
Thanks, Bill and good afternoon, everyone. We're pleased to announce a strong third quarter performance across all our business lines and also to provide our outlook for growth for the balance of the fiscal 2022.
Speaker 4: I will occasionally reference results on a pro-forma basis, which reference quarterly results in comparisons as if all acquired businesses were owned for the third quarter of fiscal 2021. We believe these pro-forma results provide additional insights into the underlying trends when comparing current performance against parapyri.
I will occasionally referenced results on a pro forma basis, which referenced quarterly results and comparisons as if all acquired businesses were owned for the third quarter of fiscal 2021. We believe these pro forma results provide additional insights into the underlying trends when comparing current performance against prior periods.
Speaker 4: My comments today will refer to comparisons on a year over year basis otherwise noted.
My comments today will refer to comparisons on a year over year basis, unless otherwise noted.
Speaker 4: Revenue of 375.5 million in the quarter was up 324% as reported and 38% on a pro forma basis. Adjusted EBITDA increased to 57 million, growing 153% year over year, and adjusted EPS of 49 cents per share increased 133% year.
Revenue of $375 5 million in the quarter was up 324% as reported and 38% on a pro forma basis, adjusted EBITDA increased to 57 million growing 153% year over year and adjusted EPS of <unk> 49 per share increased to 133% year over year.
Speaker 4: Before Inter company eliminations are on device media revenue, which represents existing revenue derived from the company's application media, inclusive of single tap, DSP and content media platform products, increase 43% year-to-year to 133.6 million.
Before intercompany eliminations, our own device media revenue, which represents existing revenue derived from the company's application media inclusive of single tap DSP and content media.
Platform products increased 43% year over year to $133 6 million total media AD colony revenue contributed $94 3 million during the quarter and was up 28% on a pro forma basis or in a fiber business contributed $157 $4 million during the quarter and was up.
Speaker 4: total in-app media ad colony revenue contributed 94.3 million during the quarter. It was up 28% on a pro-forma basis.
Speaker 4: Our NF5 business contributed 157.4 million during the courtroom was up 48% on a pro-form.
48% on a pro forma basis.
Speaker 4: Non-GAP gross profit was up 169% to 103.4 million in the quarter, and gross margin on the platform was 28% and on a sequential basis we experience an adverse impact from partner and segment revenue mix shifts in the quarter.
non-GAAP gross profit was up 169% to $103 4 million in the quarter and gross margin on the platform was 28%.
And on a sequential basis, we experienced an adverse impact from partner and segment revenue mix shifts in the quarter.
Speaker 4: As a reminder, while gross margin rates can fluctuate from quarter to quarter, based on our product and partner mix, we anticipate continued margin expansion in the future, in line with our growth targets recently outlined in our investor day in November , driven by continued execution on our product and partner diversification strategy.
As a reminder, while gross margin rates can fluctuate from quarter to quarter based on our product and partner mix. We anticipate continued margin expansion in the future in line with our growth targets recently outlined in our Investor day in November driven by continued execution on our product and partner diversification strategy.
<unk>.
Speaker 4: We delivered continued impressive expense scale in the platform. As cash expenses were 46.4 million in Q3 are 12 percent of revenue, down from 18 percent of revenues in the prior year.
We delivered continued impressive expense scale on the platform as cash expenses were $46 4 million in Q3 or 12% of revenue down from 18% of revenues in the prior year.
Speaker 4: These same cash expenses were flat year over year on a pro-former basis, while revenues during the period were up 38%.
These same cash expenses were flat year over year on a pro forma basis, while revenues during the period were up 38%.
Speaker 4: Total operating expenses were 73.5 million, including 13.8 million in amortization of intangibles and 6.2 million in transaction related cost, and compared to a total as reported operating expenses of 17.2 million in the prior year.
Total operating expenses were $73 5 million, including $13 8 million in amortization of intangibles and $6 $2 million in transaction related cost.
And compared to a total as reported operating expenses of $17 2 million in the prior year.
Speaker 4: The integration of the acquisitions is progressing nicely and we anticipate continued cost benefits to be realized over the coming quarters as integration efforts are successfully implemented to further improve our operating.
The integration of the acquisitions is progressing nicely and we anticipate continued cost benefits to be realized over the coming quarters as integration efforts are successfully implemented to further improve our operating leverage.
Speaker 4: I'm very pleased that our operating leverage and consistent EBITDA growth is being achieved even as we continue to make a number of focus near-term investments. Primarily with our Salesforce and technology teams to support new partners and products to drive future incremental revenues on the platform.
I am very pleased that our operating leverage and consistent EBITDA growth is being achieved even as we continue to make a number of focus near term investments primarily within our sales force and technology teams to support new partners and products to drive future incremental revenues on the platform.
Speaker 4: In this context, we would expect our EBITDA margins to continue to expand over time, given the inherent operating leverage in our business. And the return to be realized from our near-term investments and synergies, to be generated from the integration of our acquisition.
In this context, we would expect our EBITDA margins to continue to expand over time, given the inherent operating leverage in our business and the return to be realized from our near term investments and synergies to be generated from the integration of our acquisitions.
Speaker 4: I continue to be pleased with the profitability and free cash flow delivered by our business. In the quarter, we achieved non-GAP adjustment at income of $50.9 million or $49 cents per share.
I continue to be pleased with the profitability and free cash flow delivered by our business in the quarter. We achieved non-GAAP adjusted net income of $50 9 million or <unk> 49 per share.
Speaker 4: as compared to 20 million or 21 cents per share in the third quarter of last year.
As compared to 20 million or <unk> 21 per share in the third quarter of last year.
Speaker 4: Adjusted EBITDA was 57 million up 150% over price.
Adjusted EBITDA was $57 million up 150% over prior year.
Speaker 4: Our gap net income was 7.1 million or 7 cents per share based on 103.3 million diluted shares outstanding.
Our GAAP net income was $7 1 million or <unk> <unk> per share based on $103 3 million diluted shares outstanding.
Speaker 4: and compared to a third quarter of last year, 2020, net income of 14.5 million or 15 cents per year.
And compared to a third quarter of last year 2020, net income of $14 5 million or <unk> 15 per share.
Speaker 4: Our GapNet income included an $18.2 million charge for the contingent consideration related to the fiber acquisition due to higher than expected performance and also included a 6.2 million.
Our GAAP net income included an $18 $2 million charge for the contingent consideration related to the fiber acquisition.
Due to higher than expected performance and also included a $6 2 million.
Speaker 4: cost related to transaction related expenses in the quarter.
Costs related to transaction related expenses in the quarter.
Speaker 4: Free cashflow for the quarter was 36.6 million, enabling us to exit the quarter with 115 million in cash. Our debt position ended the quarter at 357.5 million, consistent of 345 million drawn on a revolving line, plus 12.5 million in debt assumed through the Fibreck.
Free cash flow for the quarter was $36 6 million, enabling us to exit the quarter with $115 million in cash our debt position ended the quarter at $357 5 million consisting of $345 million drawn on our revolving line.
Plus $12 5 million of debt assumed through the fiber acquisition.
Speaker 4: We recently amended our credit facility to increase the revolving line by an additional 125 million to a total of $525 million facility. Also in January , we made our final cash urn out payment related to the acquisition, which was based on performance that met our original expectation.
We recently amended our credit facility to increase the revolving line by an additional $125 million to a total of $525 million facility also in January we made our final cash earn out payment related to the acquisition, which was based on performance that met our original expectations. We have completed all.
Speaker 4: We have completed all the cash obligations related to the acquisitions earlier this year.
All the cash obligations related to the acquisitions earlier this year.
With our expanded low cost credit facility, a healthy balance sheet strong free cash flows combined with the recent transformative acquisitions added the platform. We're pleased with our current capital position and we're poised to execute on our growth plans for fiscal 2000 22022 and beyond.
Speaker 4: With our expanded low cost credit facility, a healthy balance sheet, strong free cash flows, combined with the recent transformative acquisitions added to the platform, we're pleased with our current capital position and we're poised to execute our growth plans for fiscal 2022 and beyond. Now,
Now, let me turn to our outlook.
We currently expect full year fiscal 2022 revenue to grow to between one to two 5 billion.
Speaker 4: We currently expect full-year fiscal 2022 revenue to grow to between 1.225 billion.
Speaker 4: and 1.24 billion. We expect adjusted EBITDA to grow to between $196 million and $198 million. And non-GAP adjusted in income per deluded share to be between $1.66 and $1.68. Based on approximately 105 million deluded shares outstanding and an effective tax rate of 20% on our non-GAP adjusted income in the fiscal fourth quarter.
124 billion, we expect adjusted EBITDA to grow to between $196 million and $198 million and non-GAAP adjusted net income per diluted share to be between $1 66, and $1 68 based on approximately 105 million diluted shares outstanding at an.
Effective tax rate of 20% on our non-GAAP adjusted net income in the fiscal fourth quarter.
Speaker 4: I would highlight that the implied growth in the midpoint of our guidance has our fiscal 2022 revenues growing over 50% year of year and even a growing over 80% on a pro-former base.
I would highlight that the implied growth in the midpoint of our guidance has our fiscal 2022 revenues growing over 50% year over year and EBITDA growing over 80% on a pro forma basis.
Speaker 4: In closing, we're very pleased with our performance in the quarter and the continued execution from our teams. I'm extremely excited to build on the momentum and the success in the fourth quarter of our fiscal year and beyond.
In closing, we're very pleased with our performance in the quarter and the continued execution from our teams.
STREAMWAY excited to build on our momentum and the success in our in the fourth quarter of our fiscal year and beyond.
Speaker 4: With that, let me hand it to the operator to open a call for questions. Operator.
With that let me hand, it to the operator to open the call for questions operator.
Speaker 1: We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speaker phone, please pick up your handset before pressing the keys. To withdraw your question, please press...
We will now begin the question and answer session.
To ask a question you May press Star then one on your telephone keypad.
You are using a speakerphone please pick up your handset before pressing the keys.
To withdraw your question. Please press Star then two.
Speaker 1: At this time, we will pause momentarily to the Sumbar Rost.
At this time, we will pause momentarily to assemble our roster.
Speaker 1: Our first question is from Anthony Stoss with Craig Hallum. Please go ahead.
Our first question is from Anthony Stoss with Craig Hallum. Please go ahead.
Speaker 5: Hi guys, Abe Bill and I love to hear a little bit more on the telephonic relationship. Has that started? Have they started to push out single tap over the air yet? And given our sense, you've signed that. Have you seen any uptick and other carriers interested in that? And then also probably for you Bill or Barrett, I know it's only been two to an half months since the analyst day. Is there anything that's changed that's either sped up or slowed down? You're reaching some of those 12 to 18 month goals. Thanks.
Hi, guys, Hey, Bill and love to hear a little bit more on the Telefonica relationship has that started to have they started to push on single tap over the air yet and given our since you've signed that have you seen any uptick in other carriers interested in that and then.
Also probably for you bill or Barrett I know, it's only been 225 months since the analyst day is there anything thats changed thats, either sped up or slow down you are reaching some of those 12 to 18 months ago.
Speaker 3: Yeah, thanks Tony. I'll give you a shout out on the first
Yes, hey, thanks, Thanks, Tony I'll give a shot on the first.
Speaker 3: on the first one. And then, uh, the bear comment coming on the second one a little bit. On Telephonic, uh, yeah, we're just in the process of going. It's early days. Um, we've launched a few countries with them. Uh, part of our plans is we get into the next, uh, you know, six months or so is going to be to expand that as part of the global contract that we've signed with them. Um, all the devices that we are shipping to them are single tap enabled. Uh, and so we're just in the process of ramping and scaling it. So as we think about growth drivers, um, is we get into this year, uh, obviously, that's going to be a key component for us.
On the first one and then.
Eric comment coming out on the second one a little bit telephonic.
Telefonica, Yes, we're just in the process of going it's early days, we've launched in a few countries with them part of our plans as we get into the next six months or so is going to be to expand that as part of the global contract that we've signed with them. All the devices that we are shipping to them our single tap enabled.
So we're just in the process of ramping and scaling it. So as we think about growth drivers as we get into this year, obviously, that's going to be a key component for us.
Speaker 3: You know, just a couple high level comments on your analyst-day comment. Yeah, nothing's really changed from our comments. You know, we're still excited about the business if not more than when we talked about the long-term views in November . You know, things continue to be on track. We continue to get great feedback from customers in the marketplace. You know, right now about what we're doing. The TAM is enormous. The strategy's winning. So for us to just still let's go execute and get after it.
Just a couple of high level comments on your analyst day comment, yes, nothing's really changed from our comments, we're still as excited about the business if not more than when we talked about the long term views of November things.
Things continue to be on track, we continue to great feedback from customers in the marketplace.
Now about what we're doing the Tam is enormous the strategies, winning so for US It just still let's go execute and get after it.
Bill is a quick follow up related to a single check can you comment about what the current single tap revenue run rate might be and where you might see it a year from now.
Speaker 5: Bill, was a quick follow up related to single tap. Can you comment about what the current single tap revenue run rate might be and where you might see at the year from now?
Speaker 3: Yeah, yeah, so what we're trying to do, and that's why I actually gave some examples, some other products and growth, is we wanna start talking more about all of our growth of our products versus just any single one. The single tap continues to do well for us. It's a real business, we're excited about it. As I mentioned in my preparatory marks, we've got a number of growth drivers for it, not just more devices, but...
Yes, yes, so what we're trying to do and Thats why I actually gave some examples some other products in growth as we want to start talking more about all of our growth of our products versus just any single one single tap continues to do well for us. It is a real business. We're excited about it as I mentioned in my prepared remarks, we've got a number of growth drivers for it now just more devices, but.
Speaker 3: The ramping of existing advertisers were up to 50 now on the platform, which is fantastic. And then also, we're excited about the licensing capabilities of that. So as we think about that, it's more of a SaaS model going forward. That's something we think became nice catalyst for growth, because that is $100 billion app and sell market that we can now go after.
Yes.
The ramping of existing advertisers were up to 50 now on the platform, which is fantastic and then also we're excited about the licensing capabilities of that so as we think about that as more of a SaaS model going forward. That's something we think we can as catalyst for growth because that is 100 billion.
<unk> saw a market that we can now go after.
Thank you.
Thanks, Brian .
The next question is from Tim Horan with Oppenheimer. Please go ahead.
Speaker 1: The next question is from Tim Huran with Oppenheimer. Please go ahead.
Speaker 2: I think at the analyst, you said you had about a dozen products or so. Can you just talk about that roadmap? Where can we be maybe a year or so from now and how are some of the newer products doing? And I just had a few follow-ups.
Thank guys I think at the Analyst Day, you said you had about a dozen products are so can you just talk about that roadmap, where can we be maybe a year or so from now and how are some of the newer products that we just.
Just had a few follow ups. Thanks.
Speaker 3: Yeah, yeah, sure Tim. Yeah, I mean, that's what we're excited about is that the product roadmap is really robust right now. So whether it's on the fiber side.
Yes, yes sure Tim Yeah, that's what we're excited about the product roadmap is really robust right now so whether it's on the fiber side.
Speaker 3: as we continue advancing like mediation and expand our marketplace offerings, you know, whether it's on the ad-county side with a lot of the products we have on the brand side, and then on the content media and ad-media side as well. So we've got so many shots on goal with so many different products right now. Gives us a lot of optimism on the growth, where we're not just single threaded only to single taps. Single taps exciting, you know, we're excited about it. We talked about it in a lot of detail or analysts say about the market opportunity and our progress there. But we also want to make sure investors can keep their eye on a lot of the other products that have pretty impressive growth rates as well. And one of the charts that, you know, we really liked from our analyst day was where we showed all of our operator and OEM relationships. And not just expanding new names like we talked about Telephonic a hear just on Tony's question or on Oppo or Vivo, you were going to continue to build out the pipeline. But also is getting a deeper set of products embedded with our existing partners. So as we expand them, not just from one, but you know, we can expand them to three, four, five. And in some cases into double digits with a couple of our partners. So that's really where I think we're going to see a lot of growth. Is we are a trusted partner with many of these operators and OEMs. And so we can expand that whole product portfolio into them. So that's really strategic for us.
As we continue to advance things like mediation and expand our marketplace offerings.
Whether it's on the AD kony side with a lot of the products. We have on the brand side and then on the content media and media side as well. So we've got so many shots on goal with so many different products right now gives us a lot of optimism on the growth where we're not just single threaded only to single tap single tap is exciting we're excited about it we talked about it in a lot of detail.
At our analyst day about the market opportunity and our progress there, but we also want to make sure investors can keep their eye and a lot of the other products that have pretty impressive growth rates as well and one of the charts that we really like from our analyst day was where we showed all of our operator and OEM relationships and not just expanding new names like we talked about telefonica here just.
On Tony's question or an <unk> or vivo, we're going to continue to build out the pipeline, but also is getting a deeper set of products embedded with our existing partners. So as we expand them not just from one but expanded 345 and in some cases into double digits with a couple of our partners. So that's really where I think we're going to see a lot of growth.
As we are a trusted partner with many of these operators and Oems and so we can expand that whole product portfolio into them. So thats really strategic for us.
Speaker 2: And can you give us a sense with mobile policy, how many subscribers you have on there now or what the uptake looks like the next 12 months?
And can you give us a sense with mobile policy, how many subscribers you have on there now or what the uptake looks like the next 12 months.
Speaker 3: Yeah, so from mobile policy right now, we're a little over 10 million daily active users on the content media platform right now to them. And as we're now just starting to get going with Verizon and AT&T, we expect those would be growth catalysts for us as we get into the future.
Yes, so for mobile posse right now, we're a little over 10 million daily active users on the content media platform right now Tim and as we're now just starting to get going with Verizon and AT&T. We expect those will be growth catalyst for us as we get into the future.
Speaker 2: And then lastly, Bill, sorry to me not to lie to you. Um, this used to be an advertising ad tech world that has and have not seen. A lot of people seem to put you in a have not pocket right now. Um, could you maybe just talk about what's going on on the whole ad market and why you think, you know, you can have been out performing your peers and why that'll continue? And you're just talking about the stock, Tim.
And then lastly, bill sorry to monopolize here seems to be in the advertising AD Tech world, the haves and have not seen.
A lot of people seem to have not bucket right now could you maybe just talk about what's going on on the whole AD market and why you think you can I had been outperforming your peers and why that will continue.
And you were just talking about the stock Tim.
Speaker 2: The stock yes, the financials look great. Yeah, but you know, there's a lot of obviously disrupts.
Yes, the financials are great but.
There's a lot of obviously disruption in the industry going on and people seem to be worried that you're going to get disrupted.
Speaker 2: going on and people seem to be worried that you're going to get disrupted. You know, obviously Facebook had some weak results. Snap and others had very, very strong results just from your perspective kind of what's going on.
Obviously Facebook had some weak results snap and others had very very strong results just from your perspective kind of what's going on.
Speaker 3: you were we're excited i mean we're proud of our results and you know you're talking about you know many many hundreds of billions dollars of tamm and we know we're we've got such an aggressive market to go after and we're showing impressive growth in the oboe just you know bear it just mention that uh... you know for our full year guide you're talking about fifty percent
We're excited I mean, we're proud of our results and Youre talking about many many hundreds of billions of dollars of Tam and we've got such an aggressive market to go after and we're showing impressive growth Barrett just Barrett just had mentioned that.
For our full year guide you are talking about 50% topline and over 80% bottom line growth. So we think thats pretty impressive we're excited about that and our view is the markets may not get it right from day to day, but over the long term they do and we're going to keep doing our thing we've got a great team a great strategy, a great team and we're putting up results.
Speaker 3: Top line and over 80% bottom line growth. So we think that's pretty impressive. We're excited about that. And our view is that the markets may not get it right from day to day, but over the long term they do. And we're gonna keep doing our thing. We've got a great team, a great strategy, a great team, and we're putting up results quarter after quarter. And we'll let the chips fall where they fall over time.
After quarter, and we'll let the chips fall, where they fall over time.
Thanks, guys congratulations.
That makes sense.
Speaker 1: The next question is from Darren Afkahi with Roth Capital Partners. Please go ahead.
The next question is from Darren <unk> with Roth Capital Partners. Please go ahead.
Speaker 6: Hey guys, thanks for taking my questions. So, bearish the question on your...
Hey, guys. Thanks for taking my questions.
So Barry just a question on your.
Speaker 6: commentary about the evita outpacing the revenue growth and the flat cash off act. So it looks like your
Commentary about the EBITDA outpacing the revenue growth in the flat cash opex. So it looks like your.
Q3 performance in your guide are kind of in the low 15% adjusted EBITDA margin. If my math is correct.
Speaker 6: Q3 performance in your diet or kind of in the low 15% of Jesse DeBitton margin if my math is correct. At what point do we see more offering leverage kind of beyond that level and I guess kind of what needs to happen? Is it any particular segment or there's some integration costs that you feel like are behind you? You sit and talk about investing in the new products. I'm just kind of curious when we see some more offering leverages. You can kind of grow up this high clip.
At what point do we see more operating leverage kind of beyond that level and I guess kind of what needs to happen is it any particular segment or there is some integration cost that you feel like they're behind you you sit and you talked about investing in new products and just kind of curious when we see some more operating leverage as you kind of grew up as high clip.
Speaker 4: Yeah, I think it's a good question, Darren. You know, one of the things, build this highlight of the Google relationship, and I think it highlights some of the purchasing power and integration benefits and synergy we're starting to see, especially on the call side.
Yes, I think that's.
It's a good question Darren one of the things Bill just highlighted the Google relationship and I think it highlights some of the.
Purchasing power and integration benefits.
Benefits and synergy, we're starting to see especially on the cost side.
Speaker 4: So these will bear out over the next few quarters. But I would say we've, I'll highlight that we grew revenue 38% and on an apples-to-apples basis are cash.
So these'll diesel bear out over the next few quarters.
I would say.
<unk>.
I'll highlight that we grew revenue, 38% and on an apples to apples basis, our cash.
Speaker 4: expenses were flat. So, you know, just reiterating the operating leverage we're seeing in this business and we'll begin to see as we outlined in our, you know, our investor day, we'll begin to see those margins accreed on, you know, Bo-Vibeda and Gross Margin. They'll come over the, over the next few quarters we expect.
Expenses were flat.
<unk>.
Just reiterating the operating leverage we're seeing in this business and we will begin to see as we outlined in our <unk>.
Our Investor day, we will begin to see those those margins accrete on.
Both EBITDA.
And gross margin that will come over the over the next few quarters, we expect.
Great.
Speaker 6: Great. And now on your device expansion on the 68 million, is any of that inclusive of the expansion of Samsung?
And then on your device expansion on the $68 million.
Is any of that.
Lucid the expansion of Samsung.
Speaker 3: Yeah, absolutely. Samsung is a major driver of the experience in there. And so we saw some nice return to growth in the United States, where that had been really splatter in the past. And then internationalized, we're seeing a lot of the growth in overall devices as we go forward. So it's good to see the momentum there. And that's important just to continue to capture a wider base, especially as all of those devices that are being put out in the marketplace are single tap capable.
Yes, absolutely Samsung is a major driver of the expansion there.
So we saw some nice we saw some nice return to growth in the United States.
Where they had been kind of really flattish in the past and then internationally is where we're seeing a lot of the growth in overall devices. As we go forward. So it's good to see the momentum there and Thats important just to continue to capture a wider base, especially as all of those devices that are being put out in the marketplace or single tap capable.
Speaker 6: Brandon, just a little less one if I could squeeze it in. TikTok was called out on the meta call. And I know you guys have a relationship with them. In Latin American expanded North America on the delivery side. Is there an opportunity for you guys to work with them on inventory within the application, whether it be video, banner, et cetera?
Great and just one last one if I could squeeze it in.
Can you talk kind of was called out on the medical and I know you guys had a relationship with them.
In Latin America, and expanded North America on the delivery side.
Is there opportunity for you guys to kind of work with them on inventory within the application whether it be video banner et cetera.
Speaker 3: Short answer is absolutely. And we've got active conversations going on with them right now to continue to help them better monetize their users as well as get new users. We've been pleased to see the partnership expansion here into North America. We think there's still a lot of juice left in that squeeze for us with them specifically. And then more broadly, you heard a lot of comments over the earnings season, whether it's social media competition or streaming audio competition, streaming video competition or what have you. And you remember, we distribute all of those apps. So that's a good thing for a company like us.
The short answer is absolutely.
We've got active conversations going on with them right now to continue to help them better monetize our users as well as get new users. We've been we've been pleased to see the partnership expansion here into North America. We think there's still a lot of juice left in that squeeze for us with them, specifically and then more broadly do you heard a lot of comments.
Over the over earning season, whether it's social media competition or streaming audio competition streaming video competition or what have you and you remember we distribute all of those apps. So that's a good thing for a company like us.
Speaker 3: And so the more that there's competition in those markets and they're trying to compete for users and get users, and that's what we do is deliver apps and content. Yeah, that puts us in a pretty good spot.
And so the more that there's competition in those markets and they're trying to compete for users and get users and that's what we do is deliver apps and content puts us in a pretty good spot.
Sure.
Great. Thank you.
Speaker 1: An expression is from Tim Nolan with McCquarty. Please go ahead.
The next question is from Tim Nolan with Macquarie. Please go ahead.
Speaker 2: Alright guys, thanks a lot. I got a couple questions. One is on ad colony But would you mind just elaborating a bit more on how that seems to have turned around in the December quarter? It was um
Alright, guys. Thanks, a lot I've got a couple of questions. One is on AD colony, but would you mind, just elaborating a bit more on how that seems to have turned around in the December quarter. It was.
Speaker 2: source of a bit of weakness, certainly on the IDFA that you referred to again just now. Just wondering how that managed to turn around. That's quite a nice rebound there. And then question on fiber. That growth looks like it slowed quite a bit versus I'm talking the year of year growth rate versus the prior quarter. I'm guessing that's just a matter of kind of law of large numbers and a difficult comp, but if there's anything else you could comment on that. That would be great.
Source of a bit of weakness certainly on the idea that you referred to again just now just wondering how that managed to turnaround its quite a nice rebound there and then.
Question on fiber.
Growth looks like it slowed quite a bit versus I'm talking to year over year growth rate versus the prior quarter.
<unk>, that's just a matter of kind of law of large numbers and a difficult comp, but if theres anything else you could comment on that that'd be great. Thanks.
Speaker 3: Yeah, so yeah, and I'm calling it, they're really nice quarter.
So Tony.
Tony did a really nice quarter.
Really proud of the rebound in performance there the brand business continues to grow and that's highly strategic for our larger and in AD tech ambitions to be able to leverage some of those brands names I mentioned in my prepared remarks. So we're seeing really nice growth there across the board, but in particular was was that tonys performance business, which had contract.
Speaker 3: the brand business continues to grow and that's highly strategic for our larger end-end ad tech ambitions to be able to leverage some of those brands and names I mentioned in my prepared remarks. So we're seeing really nice growth there across the board. But in particular was Ad Counties performance business which had contracted in the September quarter and partially due to IDFA and we saw a nice rebound as we got into December quarter and even December quarter year over year showed positive growth there. So that's encouraging for us on the performance side of the business. And we're seeing brand budgets come back. And you know just an editorial comment here is a lot of the big mega tech mega cap tech players you know being able to leverage.
In the September quarter.
Partially due to <unk> and we saw a nice rebound as we got into December quarter, and even December quarter year over year showed positive growth. There. So that's encouraging for us on the performance side of the business and we're seeing brand budgets come back.
Just editorial comment here is a lot of the big Magnetek.
Speaker 3: MegaCap tech players, you know, have been able to leverage IDFA for things like you through attribution and they can't do that anymore. And so there's actually, I said my prepare remarks, there's actually more of a level playing field right now. And so as we see
Mega cap tech players have been able to leverage <unk> for things like <unk> through attribution.
And they can't do that anymore and so there is actually I said in my prepared remarks was actually more of a level playing field right now and so as we see brand budgets and performance budgets come back to ILS, because our eyeballs are on Apple products.
Speaker 3: brand budgets and performance budgets come back to iOS because our eyeballs are on Apple products. Players like us are gonna benefit from that. So we do that as a positive and we'll let our machine learning models and our AI compete head to head versus letting things like view through attribution that really give a disproportionate advantage to other players. And so things like ad colony benefit from that.
Players like us are going to benefit from that.
So we view that as a positive and we will let our machine learning models and our AI compete head to head versus letting things like view through attribution.
Really give a disproportionate advantage to other players and so things like AD colony benefit from that on the fiber side, yes, you're right. It's just a little bit of a larger numbers fiber hit a really.
Speaker 3: on the fiber side, yeah, you're right. It's just a little bit of a large numbers. Fiber hit a really, you know, really inflection point in the December quarter of last year. But I do want to emphasize that
Really inflection point in the December quarter of last year, but I do want to do want to emphasize that.
Speaker 3: We're still talking about 50 plus percent growth in that business. So we think that's pretty healthy. And more importantly was the 150 percent EBITDA growth in that business. So in other words, the bottom line's growing faster than the top line. APEC and Europe in particular, are showing really impressive growth as well as on the video side of the business. So we're really excited about the fiber business. And especially carrying it with ad colonies demand and fiber supply. And then being able to also leverage our user acquisition capabilities on the on-device media side with fibers publishers also as a tremendous amount of upside for us. So we're excited on all fronts in terms of putting this thing together.
We're still talking about 50 plus percent growth in that business. So we think that's pretty healthy.
And more importantly was the 150% EBIT growth in that business. So in other words the bottom line is growing faster than the top line.
Pack and Europe in particular, showing really impressive growth as well as on the video side of the business. So we're really excited about the fiber business.
Especially pairing it with AD colonies demand and fiber supply and then being able to also leverage our user acquisition capabilities on the device media side with fibers publishers also has a tremendous amount of upside for us. So we're excited on all fronts in terms of putting this thing together.
Speaker 2: Yeah, no, that's great. 48% growth is nothing to complain about. It's just noticing that more of a convergence between ad colony and fiber now in the growth rates, which is good from the ad colony perspective. So thanks for the color there. Yeah, and how it adds is that this is why we combine, we're combining those into one segment too, right? Is to get those synergy benefits so we can have, you know, so we can have more common approach in terms of how we do our performance, our DSP, and you in terms of how we also manage our publisher relationships. Yeah.
Yes, no thats, great, 48% growth is nothing to complain about it just noticing that more of a convergence between AD calling in fiber now in the growth rates, which is good from the AD colony perspective, so thanks for that color I.
I would add is that this is why we combined we're combining those into one segment too right is to get those synergy benefits. So we can have so we can have more common approach in terms of how we do our performance our DSP.
In terms of how we also manage our publisher relationships.
Makes sense, thanks, a lot.
Speaker 1: Good question. Alan Cree with maximum. Please go ahead. Hi, my question.
The next question is from Allen Klee with Maxim. Please go ahead.
Hi, My question has been answered thank you.
Alright.
Speaker 1: This concludes our question and answer session. I would like to turn the conference back over to Bill Stone for any closing remarks.
Thanks. This concludes our question and answer session I would like to turn the conference back over to Bill stone for any closing remarks.
Speaker 3: Yeah, thanks everyone for joining the call tonight. We'll look forward to reporting out on our progress against all the points made on tonight's call. And we'll talk to you again on our fiscal 2020 fourth quarter call in a few months. Thanks and have a great night.
Yes, thanks, everyone for joining the call Tonight, we look forward to reporting out on our progress against all the points made on tonight's call and we'll talk to you again on our fiscal 2022 fourth quarter call in a few months, thanks and have a great night.
Speaker 1: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Okay.
Speaker 7: The.
Okay.
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Right.
Yeah.
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