Q4 2021 Toast Inc Earnings Call
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Speaker 1: Good afternoon, everyone, and welcome to TOA's fourth quarter 2021 earnings conference call. I'm Edward Parker, Investor Relations. Today, our CEO , Chris Comperado, and CFO , Elena Gomez, will join us and discuss our fourth quarter employer results. After their prepared remarks, we'll take questions.
Good afternoon, everyone and welcome to <unk> fourth quarter 2021 earnings Conference call Unlevered Parker Investor Relations today, our CEO , Chris Corrado and CFO Elena Gomez will join us in discussing our fourth quarter and full year results. After their prepared remarks, we'll take questions before we start I'd like to draw your attention to the Safe Harbor statement included in today's press release.
Speaker 1: Before we start, I'd like to draw your attention to the safe harbor statement included in today's press release. During this call, we'll make statements related to our business that may be considered forward-looking within the meaning of Section 27A of the Securities Exchange Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended.
During this call, we'll make statements related to our business that may be considered forward looking within the meaning of section 27, a of the Securities Exchange Act of 19, <unk> hundred 33, as amended and section 21 E of the Securities Exchange Act of 1934 as amended.
Speaker 1: All statements other than statements of historical fact or forward looking statements, including those regarding management expectations of future financial and operational performance and operational expenditures, expected growth and business outlook, including our financial guidance for the first quarter and full year 2022.
All statements other than statements of historical fact are forward looking statements, including those regarding management's expectations of future financial and operational performance and operational expenditures expected growth and business outlook, including our financial guidance for the first quarter and full year 2022.
Speaker 1: forward-looking statements reflect our views only as of today and expect as required by law. We undertake no obligation to update or advise these forward-looking statements.
Forward looking statements reflect our views only as of today and expect as required by law.
We undertake no obligation to update or revise these forward looking statements.
Speaker 1: Please refer to the cautionary language in today's press release and our SEC filings for discussion of the risks and uncertainty that could cause actual results to different material from our expectations. During this call, we will present both gaps.
Please refer to the cautionary language in today's press release, and our SEC filings for a discussion of the risks and uncertainty that could cause actual results to differ materially from our expectations.
During this call we will present, both GAAP and non-GAAP financial measures.
Speaker 1: These non-GAAP measures are not intended to be a substitute for a GAAP result. Please refer to our press release, which lays out the detailed reconciliation of GAAP and non-GAAP measures, including some new adjustments you made this quarter.
These non-GAAP measures are not intended to be a substitute for our GAAP results. Please refer to our press release, which lays out the detailed reconciliation of GAAP to non-GAAP measures, including some new adjustments you made this quarter.
Speaker 1: Both the press releases and a replay of this call, including the accompanying investor presentation, will be available on our investor relations website. With that, I'll...
Both the press releases and a replay of this call, including the accompanying investor presentation will be available on our Investor Relations website.
With that I'd like to turn the call over to Chris.
Speaker 2: Thanks Edward and thank you all for taking the time to join us today. Toast delivered a strong fourth quarter in fiscal year 2021 as restaurants need for an all in one platform to help them thrive has only become more important. Before I jump into our results for the fourth quarter in fiscal year, I want to provide you with an overview of our business.
Thanks, Edward and thank you all for taking the time to join US today <unk> delivered a strong fourth quarter and fiscal year 2021, as restaurants need for an all in one platform to help them thrive has only become more important before I jump into our <unk>.
<unk> for the fourth quarter and fiscal year I want to provide you with an overview of our business first let me remind you about our bank ambitions, we have an amazing opportunity to empower the restaurant community around the world to delight, our guests do what they love and thrive.
Speaker 2: First, let me remind you about our big ambitions. We have an amazing opportunity to empower the restaurant community around the world to delight their guests, do what they love, and thrive.
That is our mission toast provides our restaurants with an all in one digital technology platform that combines point of sale front of house back of house and guest facing technology integrated with financial technology and payments all built with a restaurant's success in mind toast works for all restaurants.
Speaker 2: Toast provides restaurants with an all-in-one digital technology platform that combines point-of-sale, front-of-house, back-of-house, and guest-facing technology integrated with financial technology and payments, all built with the restaurant's success in mind.
Speaker 2: Toast works for all restaurants, regardless of size, concept, or cuisine, from independent cafes to enterprise brands. We serve every stakeholder, from the guests to the guests.
Regardless of size concept or cuisine from independent cafes to enterprise brands. We serve every stakeholder from the guest to the GM or owner to the wait staff to the chef suppliers in the entire ecosystem.
Speaker 2: to the GM or owner, to the wait staff, to the chef, suppliers, and the entire ecosystem.
Speaker 2: This past year was transformational for TOAST as we executed on our plan and became a publicly traded company. Our initial public offering in September was a big milestone for our company and our customer community. And the momentum continued through the end of the year resulting in a very strong Q4.
This past year was transformational for <unk> as we executed on our plan and became a publicly traded company. Our initial public offering in September was a big milestone for our company and our customer community and the momentum continued through the end of the year, resulting in a very strong Q4, our community grew.
Speaker 2: Our community grew rapidly as we added more restaurants to our platform, and as the percentage of live customers on our platform using four or more modules continue to increase.
We're rapidly as we added more restaurants to our platform and as the percentage of live customers on our platform using four or more modules continued to increase. This is a result of our strong focus on execution.
Speaker 2: This is a result of our strong focus on execution. Let me share a few financial highlights.
Let me share a few financial highlights during the quarter revenue increased 111% year over year to 500 $512 million in annual annualized recurring run rate or <unk> increased 74% year over year to $568 million.
Speaker 2: During the quarter, revenue increased 111% year over year to 512 million. And annualized recurring run rate, or ARR, increased 74% year over year to 568 million.
Speaker 2: This was driven by continued strength in gross payment volume, or GPV, the addition of new locations to our platform as we capture market share, and continued customer adoption of our growing portfolio of products.
This was driven by continued strength in gross payment volume or <unk>. The addition of new locations to our platform as we capture market share and continued customer adoption of our growing portfolio of products. The industry continues to rebound from the impact of COVID-19 and <unk>.
Speaker 2: The industry continues to rebound from the impact of COVID-19, and GPV on our platform increased to 17 billion in Q4, 125% increase year over year. We ended the quarter with approximately 57,000 live locations on our platform, up from approximately 40,000 locations in Q4 of 2020, representing a 41% increase year over year.
<unk> on our platform increased to $17 billion in Q4, 125% increase year over year. We ended the quarter with approximately 57000 live locations on our platform up from approximately 40000 locations in Q4 of 2020 representing a.
41% increase year over year.
Speaker 2: As our customer community grew, we also saw accelerated adoption of our platform as the percentage of customers using four or more core modules beyond point of sale and payments increased from 48% in Q4 of 2020 to 59% in Q4 of 2021.
As our customer community grew we also saw accelerated adoption of our platform as a percentage of customers using four or more core modules beyond point of sale and payments increased from 48% in Q4 of 2020% to 59% in Q4 of 2021.
Speaker 2: As a result, our software as a service ARPU increased year over year by 30% from Q4 of 2020.
As a result, our software as a service <unk> increased year over year by 30% from Q4 of 2020 finally as customers rely on toast to run their businesses. Our net retention continues to be strong and was 135% for 2002.
Speaker 2: Finally, as customers rely on toast to run their businesses, our net retention continues to be strong and with 135% for 2021, as Elena will discuss in a few minutes.
91, as Elena will discuss in a few minutes.
Speaker 2: Now I'd like to take a moment and provide some context on the industry as a whole.
Now I'd like to take a moment and provide some context on the industry as a whole throughout 2021, the operating environment remains challenging for restaurant operators as they face the dual challenges of shifting workforce dynamics and a sustained labor shortage alongside rising input.
Speaker 2: Throughout 2021, the operating environment remains challenging for restaurant operators as they face the dual challenges.
Speaker 2: of shifting workforce dynamics and a sustained labor shortage alongside rising input prices due to supply chain disruption and accompanying inflation.
Prices due to supply chain disruptions and accompanying accompany an inflation as you can imagine it is challenging to run a restaurant in this environment and we are committed now more than ever to being the true partner to the restaurant industry just as we've been since since the onset of the pandemic.
Speaker 2: As you can imagine, it is challenging to run a restaurant in this environment. And we are committed now more than ever to being the true partner to the restaurant industry, just as we've been since the onset of the pandemic and for the last 10 years.
And for the last 10 years.
Speaker 2: With this backdrop, what we have learned in our history serving the industry is that restaurant operators are incredibly resilient. Even before COVID-19, the industry was transforming. Dining itself was changing from mobile order and pay at the table to delivery and online ordering. The pandemic accelerated these changes.
With this backdrop, what we've learned in our history, serving the industry is that restaurant operators are incredibly resilient, even before COVID-19. The industry was transforming dining itself was changing from mobile order and pay at the table to delivery and online ordering the <unk>.
<unk> accelerated these changes when looking at the performance of restaurants on the <unk> platform. We have been impressed by their ability to take full advantage of the platform's capabilities to reinvent their business and navigate the impact of COVID-19 late.
Speaker 2: When looking at the performance of restaurants on the Toast platform, we have been impressed by their ability to take full advantage of the platform's capabilities to reinvent their business and navigate the impact of COVID-19.
Speaker 2: Later this month, we will publish the first edition of our quarterly restaurant trends report, which gives visibility into the overall state of the restaurant industry through sales data from restaurants on the Toast platform. Let me share a few highlights today.
Later this month, we will publish the first edition of our quarterly restaurant trends report, which gives visibility into the overall state of the restaurant industry through sales data from restaurants on the <unk> platform, Let me share a few highlights today.
Speaker 2: As the industry rebounded from the impact of COVID-19 in 2021, restaurant sales, as measured by same store GMV or gross merchandise volume on the toast platform increased by 41% year over year from 2020 to 2021.
As the industry rebounded from the impacts of COVID-19 in 2021 restaurant sales as measured by same store <unk> or gross merchandise volume on the <unk> platform increased by 41% year over year from 2020 to 2021.
Speaker 2: Overall, same store sales of toast customers continue to exceed pre-COVID levels, as evidenced by GMV per location increasing nearly 6% from Q4 2019 to Q4 2021.
Overall same store sales of toast customers continued to exceed pre COVID-19 levels as evidenced by GMB per location, increasing nearly 6% from Q4 2019 to Q4 2021.
Speaker 2: These are just a few strong signs that the restaurant industry, while continually battle tested, is resilient. We will continue to lobby Congress to replenish the restaurant revitalization fund, but we are also glad to see Toast Adoption contributing to restaurant success and helping restaurants navigate through this difficult time.
These are just a few strong signs that the restaurant industry, while continually battle tested is resilient and we will continue to lobby Congress to replenish the restaurant revitalization fund, but we are also glad to see toast adoption contributing to restaurants success and Hell.
<unk> restaurants navigate through this difficult time.
Speaker 2: to better support our customers in the restaurant industry at large as they reimagine their businesses.
To better support our customers in the restaurant industry at large as they re imagine their businesses.
Speaker 2: We hosted thousands of restaurant operators for a virtual edition of Spark, a restaurant innovation event where we previewed the newest host technology.
We hosted thousands of restaurant operators for a virtual edition of spark a restaurant innovation event, where we previewed the newest toast technology.
Speaker 2: During the course of the day, we unveiled an entire suite of new products designed to help restaurants take control of their finances, navigate the labor shortage, regain control of third party delivery, and better manage their P&Ls. The response from our customer community was overwhelmingly positive. So let me share two examples.
During the course of the day, we unveiled an entire suite of new products designed to help restaurants take control of their finances navigate the labor shortage regain control of third party delivery and better manage their P&L. This the response from our customer community was overwhelmingly positive. So let me share two.
<unk> as many of you know there is substantial demand for faster access to capital in the restaurant industry as both their point of sale and payments processor for restaurants, we have unprecedented visibility into the health of their business nearly two years ago, we introduced toast capital, which allow rep, which allows restaurant.
Speaker 2: As many of you know, there is substantial demand for faster access to capital in the restaurant industry. As both their point of sale and payments processor for restaurants, we have unprecedented visibility into the health of their business. Nearly two years ago, we introduced Toast Capital, which allows restaurants to borrow money and pay that money back as a percentage of daily sales.
To borrow money and pay that money back as a percentage of daily sales restaurants, absolutely love this product as they pay back more on busy days and less on slow days at spark, we introduced a new longer duration loan product and the demand for this new product has been.
Speaker 2: Restaurants absolutely love this product as they pay back more on busy days and less on slow days. At Spark, we introduced a new longer duration loan product and the demand for this new product has been robust. During calendar year 2021, we originated over a hundred million dollars in total toast capital loans.
<unk> during calendar year 2021, we originated over $100 million in toast in total toast capital loans.
Speaker 2: A second highlight from Spark was the introduction of an enhanced suite of products designed to help restaurants maintain control of takeout and delivery.
A second highlight from spark was the introduction of an enhanced suite of products designed to help restaurants maintained control of takeout and delivery.
Speaker 2: With Orders Hub, Toast has helped more than 20,000 restaurants manage both takeout and delivery orders from first-party Toast ordering channels and third-party providers. Toast is the first restaurant technology platform to deliver direct integrations with the five largest third-party delivery brands, DoorDash, Caviar, Grubhub, Postmates, and Uber Eats.
With orders hub toast has helped more than 20000 restaurants manage both takeout and delivery orders from first party toasts ordering channels and third party providers toast as the first restaurant technology platform to deliver direct integrations with our five largest third party delivery.
<unk> brands Jordache Caviar, Grubhub post mates in Uber eats and our performance center provides unique visibility into the profitability of each channel when used together this new suite of products enables our customer community to truly take control of their takeout and delivery business.
Speaker 2: And our Performance Center provides unique visibility into the profitability of each channel. When used together, this new suite of products enables our customer community to truly take control of their takeout and delivery business.
Speaker 2: We're excited about how our customers are using these new products announced at Spark and how they further our position as the lead-in, all-in-one platform for restorations.
We're excited about how our customers are using these new products announced that spark and how they further our position as the leading all in one platform for restaurants.
Speaker 2: Throughout the quarter, we experienced robust demand in the market for the Toast platform. In 2021, we added around 17,000 new restaurant locations on the platform. Throughout Q4, we saw incredible demand across all segments, from single-location SMB restaurants to regional mid-market and large enterprise brands.
Throughout the quarter, we experienced robust demand in the market for the <unk> platform in 2021, we added around 17000, new restaurant locations on the platform throughout Q4, we saw incredible demand across all segments from single location SMB restaurants to regional mix.
Market and large enterprise brands.
Speaker 2: This quarter, we signed a new deal with Senneli Concepts, the holding company for multiple national restaurant and retail brands, including Which Which Superior Sandwiches, Pachugo Gelato Cafe, Birdgasa Tenders and Tots, Supernova and Earth Burger.
This quarter, we signed a new deal with cinelli concepts, the holding company for multiple national restaurant, and retail brands, including which which superior sandwiches <unk> Gelato Cafe Berg <unk> tenders in tops supernova, an earth Burger Cinelli concepts is looking to.
Speaker 2: Sinelly Concepts is looking to improve efficiency by moving its business to a digital platform. It will be rolling out toast to 250 locations nationwide for point of sale, kitchen display systems, and kiosks.
Prove efficiency by moving its business to a digital platform. It will be rolling out toast to 250 locations nationwide for point of sale kitchen display systems and kiosks.
Speaker 2: We also signed a new deal with Kohn Restaurant Group, which is rolling out toast for front of house with Toast Go and Order and Pay at the Table, and back of house with our kitchen display system. Kohn Restaurant Group will use toast at 35 locations, both in California and Hawaii, and will continue its efforts in converting its entire technology stack to a best-in-class cloud-based platform.
We also signed a new deal with cone restaurant group, which is rolling out toast for front of house with Toast go and order and pay at the table and back of house with our kitchen display system cone restaurant group will use toast at 35 locations, both in California, and Hawaii, and we will continue its efforts and converting its entire.
<unk> staff to our best in class cloud based platform <unk>.
Speaker 2: Pavement Coffee House, an independent and locally owned coffee house with eight shops in Boston and Cambridge, purchased Toast POS and Payroll in Q4. Toast is replacing multiple vendors for loyalty, payroll, gift cards, and online order.
<unk> coffeehouse and independent and locally owned coffee house with eight shops in Boston, and Cambridge purchase toast Pos in payroll in Q4, toasters, replacing multiple vendors for loyalty payroll gift cards and online ordering.
Speaker 2: By consolidating on toast, customers like Pavement Coffee House can see lower total cost and experience the benefits of an integrated platform, common UI, shared data, and a single partner relationship.
By consolidating on toast customers like pavement coffeehouse can see lower total cost and experienced the benefits of an integrated platform common UI shared data in a single partner.
Partner relationships to manage.
Speaker 2: In addition to the exciting growth across our customer community, we also welcomed a new board member to our board of directors in Q4.
In addition to the exciting growth across our customer community. We also welcomed a new board member to our board of directors in Q4.
Speaker 2: Hillary Coppola McAdams joined the TOAST Board of Directors on November 30th. If you're not familiar with Hillary, she has spent more than three decades in operating and leadership roles devoted to accelerating high growth software companies through sales, business development, customer success, and more. Currently, she is a venture partner with New Enterprise Associates, NEA, a venture capital firm.
Hillary Cop-out Mcadams join the <unk> Board of directors on November 30th if Youre not familiar with Hillary. She has spent more than three decades in operating and leadership roles devoted to accelerating high growth software companies through sales business development customer success and more.
Currently she is a venture partner with new Enterprise Associates NEA, a venture capital firm prior to NDA Hilary served as the president of new relic.
Speaker 2: Prior to NEA, Hillary served as the president of New Relic.
Speaker 2: president of global sales at Salesforce, and also held executive roles at Intuit Inc. and Oracle Corporation. We are really excited about having Hilary on our board. Welcome to the team, Hilary.
President of global sales at Salesforce and also held executive roles at Intuit, Inc. And Oracle Corporation. We are really excited about having Hilary on our board welcome to the team Hillary.
Before I wrap up and pass the call to Elena I thought it would also be helpful to tee up our primary focus areas that we look forward to updating you on in 2022.
Speaker 2: The first is our focus on being the trusted platform of choice for the restaurant industry.
The first is our focus on being the trusted platform of choice for the restaurant industry. There are approximately 860000 restaurant locations across the U S and we see an enormous opportunity ahead within this large addressable market.
Speaker 2: There are approximately 860,000 restaurant locations across the US. And we see an enormous opportunity ahead within this large addressable market.
Speaker 2: As evidenced by our growth in Q4, there is tremendous demand for the toast platform as restaurant operators navigate the new normal.
As evidenced by our growth in Q4, there is tremendous demand for the <unk> platform as restaurant operators navigate the new normal toast is the all in one technology platform built exclusively for restaurants by people who understand their specific needs.
Speaker 2: Toast is the all-in-one technology platform built exclusively for restaurants by people who understand their specific needs.
Speaker 2: Second, our industry has been through a massive transition during the past two years.
Second our industry has been through a massive transition during the past two years to.
Speaker 2: To help our customer community navigate this transition, we will continue to invest in their success for a commitment to customer success and support.
To help our customer community navigate this transition we will continue to invest in their success to our commitment to customer success and support.
Speaker 2: Third, given our momentum in mid-market and enterprise, we are confident in our ability to serve restaurants of all types and sizes. I shared earlier just a few examples of mid-market and enterprise wins this past quarter, and we will continue to invest in our capability here.
Third given our momentum and Midmarket and enterprise, we are confident in our ability to serve restaurants of all types and sizes.
Sure. It earlier, just a few examples of mid market and enterprise wins this past quarter, and we will continue to invest in our capability here.
Speaker 2: Finally, we have a substantial opportunity to provide our platform to international locations. As discussed earlier, we estimate our total addressable market at least doubles the US opportunity if we look globally. In late 2021, we started our initial investment to seed our international expansion.
Finally, we have a substantial opportunity to provide our platform to international locations as discussed earlier, we estimate our total addressable market at least doubles the U S opportunity. If we look globally in late 2021, we started our initial investment to see.
Our international expansion.
Speaker 2: With that, I will close by saying I am honored and humbled to be part of supporting the restaurant industry through this past year. I am also equally excited about 2022. Restaurants are resilient.
With that I will close by saying I'm honored and humbled to be part of supporting the restaurant industry through this past year I am also equally excited about 2022 restaurants are resilient they make up the social fabric of our community and we believe our.
Speaker 2: They make up the social fabric of our community, and we believe our commitment to aligning our success with restaurant success will lead to a stronger and exciting future ahead. I'd like to thank our customers.
Our commitment to aligning our success with restaurants success will lead to a stronger and exciting future ahead.
Like to thank our customers our.
Speaker 2: our partners, and our toast employees for their hard work and support in 2021. The financial results we're sharing today wouldn't be possible without your confidence in our platform, commitment to the industry, and unwavering support for our vision. Now I'd like to hand it over to our CFO , Elena Gomes. Come on in. Okay.
Our partners and our toast employees for their hard work and support in 2021, the financial results were sharing today wouldn't be possible without your confidence in our platform commitment to the industry and unwavering support for our vision now I'd like to hand, it over to our CFO Elena <unk>.
Yes.
Speaker 3: Thanks, Chris. And I just want to echo the thank you to our employees and to our customers. 2021 has been an unforgettable year. And I appreciate your commitment and dedication to our company. So I'm going to remind you as I get into results that we will refer to GAAP and non-GAAP measures. Refer to today's press release for reconciliation of GAAP to non-GAAP financial performance, and additional disclosures regarding these
Thanks, Chris and I, just want to echo the.
Thank you to our employees and to our customers' 2021 has been an unforgettable year and I appreciate your commitment and dedication to our company.
So I'm going to remind you as I get into results that we will refer to GAAP and non-GAAP measures.
Refer to todays press release for a reconciliation of GAAP to non-GAAP financial performance and additional disclosures regarding these measures as Chris mentioned, we had a strong Q4 to exit 2021 and to cap off the year, we became a public company with continued momentum in Q4, we outperformed all key metrics, which is a test.
Speaker 3: As Chris mentioned, we had a strong Q4 to exit 2021, and to cap off the year, we became the public company. With continued momentum in Q4, we outperformed all key metrics, which is a testament to the strong execution of our collective team. We are proud of the new locations we added to our platform through 2021, which reflect the value of our all-in-one digital platform.
Limit to the strong execution of our collective team. We are proud of our new locations, we added to our platform through 2021, which reflect the value of our all in one digital platform.
Speaker 3: In Q4, we generated revenue of $512 million, up 111% year over year, and $1.705 million for the full year 2021, a 107% increase year over year.
In Q4, we generated revenue of $512 million up 111% year over year, and 1170 5 million for the full year 2021.
Hunter and a 7% increase year over year, we closed the year at $568 million in air are up 74% year over year. We continue to believe are our as our norstar metric.
Speaker 3: We close the year at $568 million in ARR, up 74% year over year. We continue to believe ARR is our North Star metric.
Speaker 3: As Chris said, we ended the year with approximately 57,000 live locations on our platform compared to 40,000 in Q4 2020, representing a 41% year over year growth.
<unk> said, we ended the year with approximately 57000 lives locations on our platform compared to 40000 in Q4 2020, representing a 41% year over year growth. In addition, we're also proud to report that our net retention rate also referred to as <unk>, which we reported in our S. One would be greater than.
Speaker 3: In addition, we're also proud to report that our net retention rate, also referred to as NRR, which we reported in our S1 to be greater than 110% for the last five years, was 135% in 2021.
110% for the last five years was 135% in 2021.
Speaker 3: NRR comprises both SaaS and FinTech Solutions revenue, both of which had a retention rate above 110%.
And our comprises both SaaS and Fintech solutions revenue, both of which had a retention rate above 110%.
Speaker 3: SAS NRR was strong to the expansion of locations from our existing customers, as well as customers adding more products.
<unk> was strong to the expansion of locations from our existing customers as well as customers, adding more products from our Fintech perspective, we have shared with you that in 2021, we benefited from higher debit and credit mix as well as higher card not present volume in 2022, we anticipate these trends will have largely stabilized and as such.
Speaker 3: From a fintech perspective, we have shared with you that in 2021, we've benefited from higher debit and credit mix as well as higher card not present volume. In 2022, we anticipate these trends will have largely stabilized and as such we expect NRR going forward to trend closer to 110% as we shared in the S1.
We expect <unk> going forward to try and closer to a 110% as we shared in the Epsilon.
Speaker 3: Our subscription services revenue grew 86% year over year to $54 million in the fourth quarter, driven by an increase in customers adopting more of our SaaS products.
Our subscription services revenue grew 86% year over year to $54 million in the fourth quarter, driven by an increasing customers adopting more of our SaaS products.
Speaker 3: As of the end of 2021, 59% of our test locations use four or more core products on top of our integrated POS and payment solution as compared to 48% a year ago.
As of the end of 2021, 59% of our test location to use for our more core products on top of our integrated Pos and payment solution as compared to 48% a year ago.
Speaker 3: Our financial technology solutions revenue grew 117% year over year to 421 million.
Our financial Technology solutions revenue grew 117% year over year to $421 million.
Speaker 3: in the fourth quarter driven by GPV of 17 billion, which had an increase of 124% year over year. GPV is driven by transactions processed on our platform. Since early 2021, annualized GPV per processing location continues to remain strong at an average of 1.3 million per location. As a reminder, our GPV per location dropped by 45% at the onset of COVID, but has steadily returned to above pre-COVID levels. For more information, visit GPV.com
In the fourth quarter, driven by <unk> 17 billion, which had an increase of 124% year over year <unk> is driven by transactions processed on our platform or since early 2021 annualized <unk> per process same location continues to remain strong at an average of $1 3 million per location.
As a reminder, our J PV per location dropped by 45% at the onset of Covid, but has steadily returned to above pre COVID-19 levels. As we have stated before there is quarterly seasonality with our financial technology solutions revenue as restaurants on average generally perform better in the second and third quarters given that we.
Speaker 3: As we have stated before, there's quarterly seasonality with our financial technology solutions revenue, as restaurants on average generally perform better in the second and third quarters.
Speaker 3: Given that we continue to anticipate seasonal fluctuations in the annualized GPV per location from quarter to quarter, however, on an annualized basis, our GPV per location is consistent and remains durable.
To anticipate seasonal fluctuations in the annualized <unk> per location from quarter to quarter. However, on an annualized basis, our chi PV per location is consistent and remains durable.
Speaker 3: For the fourth quarter, non-GAAP gross profit, which excludes stock-based compensation and depreciation and amortization expense, that was a mouthful, came in at $82 million, up 54% year over year. In addition to the growth in our customer base, this growth was driven by higher revenue per location, which in turn, helped to curb public outputAYY outno on Gameausc You Since deeper
For the fourth quarter, non-GAAP gross profit, which excludes stock based compensation and depreciation and amortization expense that was a mouthful came in at $82 million up 54% year over year. In addition to the growth in our customer base. This growth was driven by higher revenue per location, which in turn has been driven by continued growth in average.
Speaker 3: has been driven by continued growth and average revenue per unit known as ARPU for both SaaS and financial technology solutions. We are pleased with our ARPU performance as a driver to non-GAAP gross profit, and we believe that such performance can be sustainable.
Revenue per unit known as <unk> for both SaaS and financial Technology solutions. We are pleased with our performance as a driver to non-GAAP gross profit and we believe that such performance can be sustainable.
Speaker 3: Drilling down into our R-group performance, we've seen our SaaS R-group increase as a result of continued adoption of our platform by both new and existing customers. We continue to invest in our technology and remain highly focused on driving innovation across our product portfolio.
Drilling down into our performance, we've seen our fast or could increase as a result of continued adoption of our platform by both new and existing customers. We continue to invest in our technology and remain highly focused on driving innovation across our product portfolio.
Speaker 3: Our fintech solutions RPU is up more than 50% from 2-4-2019 or pre-COVID levels, primarily as a result of GPV relocation and card not present volume. As a reminder, two factors that influence fintech solutions RPU are the mix of card not present volume and the debit credit mix.
Our Fintech solutions <unk> is up more than 50% from Q4 2019 or pre COVID-19 levels, primarily as a result of GP per location and card not present volume as a reminder, two factors that influenced fintech solution to <unk> or the mix of card not present volume in the debit credit mix consumers continue to you utilized.
Speaker 3: Consumers continue to utilize digital channels, and as such we believe the Card now present volumes will remain elevated. The debit credit mix has returned to pre-COVID levels.
What channels and as such we believe the card not present volumes will remain elevated the debit credit mix has returned to pre COVID-19 levels.
Speaker 3: Turning to hardware cost of revenue, as shared in the last earnings call, our freight costs remain elevated due to supply chain dynamics. We continue to believe they will remain elevated through the near term. Despite increased hardware costs, however, we remain confident in our ability to deliver hardware for our customers.
Turning to hardware cost of revenue as shared in the last earnings call. Our freight costs remained elevated due to supply chain dynamics. We continue to believe they will remain elevated through the near term. Despite increased hardware cost. However, we remain confident in our ability to deliver hardware for our customers.
Speaker 3: Before I turn to operating expenses, I want to remind you that we use customer acquisition costs and payback metrics to measure the performance of our business and guide our investment decisions. We are proud to share that our payback period for the full year 2021 was approximately 12 months. Our healthy unit economics and strong payback periods continue to make us feel confident in our ability to invest for durable growth.
Before I turn to operating expenses I want to remind you that we use customer acquisition cost and payback metrics to measure the performance of our business and guide our investment decisions. We are proud to share that our payback period for the full year 2021 was approximately 12 months are healthy unit economics, and strong payback periods continue to make a step comp.
Put it in our ability to invest for durable growth now.
Speaker 3: Now let's turn to our operating expenses, which I will review on a non-GAAP basis.
Now, let's turn to our operating expenses, which I will review on a non-GAAP basis. In Q4, we continued to invest in sales and marketing and research and development to capture Tam and build out our platform. Additionally, general and administrative costs increased as a result of operating as a public company. This includes costs from the adoption of the new credit loss.
Speaker 3: In Q4, we continue to invest in sales and marketing and research and development to capture our TAM and build out our platform.
Speaker 3: Additionally, general and administrative costs increase as a result of operating as a public company. This includes costs from an adoption of the new credit losses accounting standard in Q4, and increased investment to support the growth of our business.
The new credit losses accounting standard in Q4 and increased investment to support the growth of our business as a result, as a result of these investments adjusted EBITDA for the fourth quarter was negative 45 million for Q4 and negative $42 million for the full year 2021.
Speaker 3: As a result of these investments, adjusted EBITDA for the fourth quarter was negative 45 million for Q4 and negative 42 million for the full year 2021.
Speaker 3: Now let me turn to guidance. For the first quarter, we expect revenue to be in the range of 469 million to 499 million, which represents 72% year over year growth at the midpoint.
Now, let me turn to guidance for the first quarter, we expect revenue to be in the range of 469 million to 499 million, which represents 72% year over year growth at the midpoint, we expect adjusted EBITDA to be in the range of negative 65 million to negative $55 million for the full year 2022, we expect.
Speaker 3: We expect adjusted EBITDA to be in the range of negative 65 million to negative 55 million.
Speaker 3: For the full year 2022, we expect revenue to be in the range of 2.349 million to 2.409 million, which represents 40% year over year growth at the midpoint and adjusted to be in the range of 240 negative 240 million to negative 200 million.
Revenue to be in the range of $2 34, 9 million to $2 $4 9 million, which represents 40% year over year growth at the midpoint and adjusted EBITDA to be in the range of 240 million negative $240 million of negative 200 million.
Speaker 3: As you can see, we are deliberately investing in long-term growth.
As you can see we are deliberately investing to drive long term growth. The stakes have never been higher for restaurants. The restaurant industry is going through massive change driven by undeniable trends in the world across labor supply chain and guest adoption of of technology. Our investments in 2022 are reflective of this opt.
Speaker 3: The stakes have never been higher for restaurants. The restaurant industry is going through massive change driven by undeniable trends in the world across labor, supply chain, and guest adoption of technology. Our investments in 2022 are reflective of this opportunity we have ahead of us.
<unk>, we have ahead of us with only approximately 7% market share here in the United States. We continue to believe we are in the early innings of this opportunity.
Speaker 3: With only approximately 7% market share here in the United States, we continue to believe we are in the early innings of this opportunity. As such, we will continue to invest in research and development, as well as in sales and marketing, to cost-effectively capture our market share.
Such we will continue to invest in research and development as well as in sales and marketing to cost effectively capture our market share. Our primary focus is on being the trusted platform of choice for the restaurant industry. Our business is performing well and there is enormous demand for the <unk> platform as restaurants need to streamline our operations.
Speaker 3: Our primary focus is on being the trusted platform of choice for the restaurant industry. Our business is performing well, and there is enormous demand for the toast platform as restaurants need to streamline their operations, increase revenue, and retain great employees.
Increased revenue and retain great employees.
Speaker 3: Our ambition continues to be to serve restaurants all around the world. And with that, we will be making foundational investments in 2022 to drive growth internationally. We look forward to updating you on this multi-year journey in future quarters.
Our ambition continues to be to serve restaurants, all around the world and with that we will be making foundational investments in 2022 to drive growth internationally. We look forward to updating you on this multiyear journey in future quarters in closing our strong 2021 performance demonstrates our success in capturing market share we are.
Speaker 3: In closing, our strong 2021 performance demonstrates our success in capturing market share. We are built to serve a large and growing addressable market and we've shown we can execute at scale with healthy unit economics. We continue to believe we are uniquely positioned to drive durable growth for ourselves and for restaurants using our platform.
<unk> to serve large two built to serve a large and growing addressable market and we've shown we can execute at scale with healthy unit economics. We continue to believe we are uniquely positioned to drive durable growth for ourselves and for our restaurants using our platform now.
Speaker 3: Now I'd like to turn the call back to the moderator for our Q and a session.
Now I'd like to turn the call back to the moderator for our Q&A session.
Speaker 1: All right, thank you very much, Chris and Elena. Let's go ahead and start our Q&A session. Please use the raise the hand function in Zoom to ask a question. And our first question comes from Josh Bear at Morgan Stanley . Josh, please go ahead.
Alright, Thank you very much Chris Molina, Let's go ahead and start for a Q&A session.
Use the raise the hand function zoomed asking questions and our first question comes from Josh Baer with Morgan Stanley Josh.
Please go ahead.
Speaker 4: Great, thank you for the question. So why don't you get some context on the pace of location additions in 22. If you could provide any insight into how you're thinking about that and maybe tying into the ramp of sales reps and capacity, where are you today or in 22 versus 2019 from that perspective.
Great. Thank you.
So the question so.
So why don't you give some context on the pace of location additions in 'twenty two.
Can you provide any insight into how youre thinking about that and maybe tying into the ramp of sales reps and capacity where are you today are in 22 versus 2019 from that perspective.
Speaker 3: Yeah, I can start at the highest level, without me guiding for locations. We've intentionally invested Josh in adding to our sales force.
Yes, I can I can start at the highest level you know what.
Without any guiding for locations.
We've intentionally invested Josh in adding to our sales force and we've often said that Tam is our number one priority and then <unk> will follow where actually balancing both but we're pretty excited about the locations. We added on our platform in 2021, and we see no reason why we wouldn't continue.
Speaker 3: And we've often said that TAM is our number one priority. And then ARPU will follow. We're actually balancing both. But we're pretty excited about the locations we added on our platform in 2021. And we see no reason why we wouldn't continue to have success adding locations.
To have success, adding locations frankly very efficiently to with the 12 12 month payback period that we experienced in 2021.
Speaker 3: frankly, very efficiently too with the 12 month payback period that we experienced in 2021. We feel confident to make this investment and we'll continue to see growth on our platform.
Feel confident to make this investment and we'll continue to see growth on our platform.
Speaker 4: Great and related as far as the location additions that you've been seeing any way to break down where you're having the most success or where you're strategically focused for as far as competitive wins.
Great and related as far as the location additions that you've been seeing any way to break down where you're having the most success or where you are strategically focus for as far as competitive wins.
Speaker 4: Um, new geographies in the US that are under penetrated and if it is competitive, is it from legacy vendors? Or are you going after cloud replacements? And then, I guess, lastly, new restaurant formations and. You know, if that's a strategic priority, just winning an outside share of the new restaurant formations. Thank you.
New geographies in the U S that are underpinning penetrated.
If it is competitive as it from legacy vendors or are you going after cloud replacements, and then I guess lastly.
New restaurant formations.
If that is a strategic priority just winning an outsized share of the new restaurant formations. Thank you.
Speaker 2: I can jump in. Oh, go ahead. Yeah, either way. Josh, we've seen broad momentum across multiple sectors of our business and multiple geos. I wouldn't say there's any one geo or sector that has grown faster. We're seeing a really good traction in SMB, a really good momentum in mid-market and enterprise as I referenced with those examples.
I can just go ahead.
Alright.
Josh we've seen broad momentum across multiple sectors of our business in multiple geos I wouldn't say, there's any one.
Our sector that has grown faster, we're seeing really good traction in SMB.
Really good momentum in mid market and enterprise as I referenced with those examples and we have teams across the U S embedded in local communities going after their market. So we feel good about our position.
Speaker 2: And we have teams across the US embedded in local communities going after their markets. So we feel good about our position. You know, I'd say we believe that we have the capability to serve restaurants of different types, formats, and sizes than any of our competitions. So we feel good about our position, and we're seeing steady demand on that front.
<unk>.
We believe that we have the capability to serve restaurants of different types of formats and sizes than any of our competition. So we feel good about our position and we're seeing steady demand on that front.
Speaker 1: Thanks, Josh. Let's go to Hintin Huang at JPMorgan, please.
Thanks, Josh.
Let's go to Tien Tsin Huang of Jpmorgan. Please.
Speaker 4: Hey, thanks so much. Good to see all of you all here today. Thanks for the time. So.
Hey, thanks, so much good to see all of you all here today and thanks for the time.
Speaker 4: I hear you loud and clear on the investing. I think it makes a lot of sense. The time is now to do it. So with.
Hear you loud and clear on the investing I think it makes a lot of sense time is now to do it so.
Speaker 4: with the investments across developing new products. I know you're working really hard to build new products. And of course, customer acquisition is just trying to better understand how you're prioritizing.
With the investments across developing new products I know, you're working really hard to build new products and of course customer acquisition, just trying to better understand how youre prioritizing.
Speaker 4: those two, is it changed versus maybe 90 days ago? And is your LGBT thinking still the same versus 90 days ago? Just trying to better understand the aspects, given the wider community I lost?
Those two changed versus maybe 90 days ago.
Your LTV to CAC thinking still the same versus 90 days ago, just trying to better understand.
Opex given the wider EBITDA loss for the year notes. So a good question.
Speaker 3: for the year. Yeah, no, it's a good question. You know, let me just start by saying we have a ton of confidence and conviction about our opportunity and that has not changed at all actually.
Let me just start by saying, we have a ton of confidence and conviction about our opportunity and that has not changed at all actually.
Speaker 3: In fact, I would say after our performance in 2021, we have even more conviction. And so our prioritization has always been let's focus on capturing the opportunity ahead with the TAM.
In fact, I would say.
After to our performance in 2021, we have even more conviction in SAR prioritization has always been let's focus on capturing the opportunity ahead with the Tam.
Speaker 3: And we know we're in the early innings, as you know, and we also have seen some data points, proof points.
And we know we're in the early innings as you know.
And we also have seen some data points proof points demand continues to be strong and customers engaged on our platform whether that's in our our as you saw that we talked about or just consistent addition of locations to our platform and so we're going to remain very disciplined and have a lot of rigor about our.
Speaker 3: Demand continues to be strong and customers engaging on our platform, whether that's
Speaker 3: NRR, as you saw that we talked about, or just consistent addition of locations to our platform. And so we're going to remain very disciplined and have a lot of rigor about our investments and point investments to things that will drive growth.
<unk> and point investments to things that will drive growth and then of course back to your timing point, the pandemic really amplified the need that customers have for technology and to make their operations more efficient and we believe when you put all that data together.
Speaker 3: And then of course, back to your timing point, the pandemic really amplified the need that customers have for technology and to make their operations more efficient. And we believe when you put all that data together.
Speaker 3: we're well positioned to capture that opportunity. So it's really important that we're intentional about this investment. I would tell you, it doesn't mean we're not thinking about profitability. So I don't want you to take that from this at all. I think we have to have aood this pause for what we've said at this point.
We are well positioned to capture that opportunity. So it's really important that were intentional about this investment.
I would tell you it doesn't mean, we're not thinking about profitability. So I don't want you to take that from this at all in fact.
Speaker 3: in our, in our executive alignment with, in our comp plans, we've aligned on the fact that, you know, we do at the right time need to drive operating leverage, right? We're going to drive an orient to durable growth today.
<unk> and our executive alignment in our comp plans, we've aligned on the fact that we do at the right time needed to drive operating leverage right, we're going to drive and Orient to durable growth today.
Speaker 3: But of course, over time, we will drive operating leverage.
But of course over time, we will drive operating leverage yes that makes.
Speaker 4: great sense. If you don't mind just a quick follow up just thinking about the first quarter, Elena just any puts and takes there.
Great sense, if you don't mind, just a quick follow up just thinking about the first quarter Atlanta, just any puts and takes there.
Speaker 4: with revenue and I know seasonality is always something to think about and we're coming out of that hopefully and I don't know if there's anything to call out with GMV or locations, return or growth in the first quarter versus the fourth. Thank you.
With revenue and I know seasonality is always something to think about I know, we're coming hopefully in the second.
Can you call out what <unk> are locations return or growth in the first quarter versus the fourth.
Speaker 3: Yeah, that's a great question. So I would just point to a couple of things. As a reminder, last year at this time, vaccines were coming back and people were coming back. Right? So just don't forget that as you guys I know a lot of you look at sequential moves.
Yes, that's a great question. So I would just point to a couple of things.
A reminder, last year at this time vaccines, where we're coming back and people are coming back right. So just don't forget that as you guys. I know a lot of if you look at sequential moves so pay attention to that because we had a big surge last year, we didn't expect that.
Speaker 3: So pay attention to that because we had a big surge last year. We didn't expect that to repeat this year, right, because we've now been unfortunately used to this kind of quasi-environment we're operating in. But even without that, we're not really
Got to repeat this year right because we've now been unfortunately used to this kind of quasi environment, we're operating in but even without that.
Speaker 3: dynamic from last year. There's always seasonality in our payments, as you know. So Q1 tends to be a quarter where the seasonality is such that we have lower GPV than say Q2 and Q3. So that was not much.
Dynamic from last year, Theres always seasonality in our payments as you know so Q1 tends to be a quarter, where the seasonality is such that we have lower <unk> than say Q2, and Q3. So that was not much that's not what that.
Speaker 3: That's not what that that did not surprise us. I would tell you we had a little bit of omnicron in the early part, late days of December and early part of January . But we, we believe that's transitory and frankly behind us at this point. The other thing I'll point to that you may not see in the guidance is we anticipate fast will continue to increase.
That did not surprise us I would tell you we had a little bit of omnicom and the early part.
Late days of December and early part of January but we believe that's transitory and frankly behind us at this point the other thing I'll point to that you may not seen the guidance as we anticipate SaaS will continue to increase so you will see that sequential increase Q4 to Q1.
Speaker 3: So you will see that sequential increase Q4 to Q1. So I hope that gives you enough color to kind of give you the backdrop for Q1. Yes, thank you.
No.
I hope that gives you enough color to kind of give you the backdrop for Q1. Thank you Greg.
Speaker 1: Thanks very much. Let's go to Josh back at KeyBank. Josh.
Thanks, very much let's go to Josh Beck Keybanc Josh.
Josh.
Speaker 1: Thank you so much for taking the question. I wanted to maybe start with a higher level question. I think one that is surfacing a lot is.
Thank you so much for taking the question.
We start with a higher level question I think one that is surfacing a lot is really what's the impact of a full reopening and hopefully as we progressed through the year, There's obviously puts and takes.
Speaker 1: Really, what's the impact of a full reopening, hopefully, as we progress through the year? There's obviously puts in and takes against your model. So just kind of curious how you're trying to embed that into the outlook and what are some of the more important factors we should be keying in on there.
<unk> takes against your model. So just kind of curious how you're trying to embed that into the outlook and what are some of the more important factors, we should be keying in on there.
Speaker 2: Yeah, I mean, I could jump in at a high level and Elena feel free to support it, but.
Yes, I mean, I could jump in at a high level and Atlanta feel free to support it but I.
Speaker 2: I mean, listen, we're excited about 2022. We're seeing really strong demand. We're executing well, so our mindset is sort of a growth oriented mindset to go after.
I mean listen we're excited about 2022, we're seeing really strong demand.
We're executing well so.
Our mindset is sort of a growth oriented mindset to go after locations and the Tam and support the restaurant community as it starts to recover if you zoom out.
Speaker 2: Locations in the Tam and support the restaurant community as it starts to recover. If you zoom out, you know, this is an industry.
This is an industry, that's largely been underserved by great technology.
Speaker 2: largely been underserved by great technology and in the past two years they've gone from crisis.
And in the past two years, they've gone from crisis to survival to recovery and now to a timeframe that I think it's time to thrive so personally as a team and as a management team and our company and our board. We're excited about 2022, because we think it's going to be a little bit of a run.
Speaker 2: to survival, to recovery, and now to a timeframe that I think it's time to thrive.
Speaker 2: So personally, as a team and as a management team and a company and a board, we're excited about 2022 because we think it's gonna be a little bit of a renaissance coming back to the restaurant industry. Though it's been difficult for the past two years, we're certainly excited about what lies ahead and some of the momentum that we may see across the entire business.
Hassan it's coming back to the restaurant industry, though it's been difficult for the past two years. We're certainly excited about what lies ahead and some of the momentum that we may see across the entire business.
Speaker 3: Yeah, I mean, I think in in our guidance, as we as we entered into the year, there was a few few trends that really, really we pay attention to that that you guys are familiar with.
Yeah, I mean I think.
In our guidance as we as we entered into the year. There is a few that few trends that really really we pay attention to that you guys are familiar with card not present as one of those debit and credit mix all of those in fact impact our fintech <unk>. So for card not present as I said in my script.
Speaker 3: Card Not Present is one of those. Dev and Credit Mix, all those impact our FinTech ARPU. So for Card Not Present, as I said in my script, we do...
We do believe consumer behavior has largely changed I think all of us are probably using online ordering more than we did in the past and so we believe some of that that behavior is going to persist and therefore, we believe <unk> will remain somewhat elevated debit and credit mix has largely come back to pre COVID-19 levels. So we <unk>.
Speaker 3: consumer behavior has largely changed. I think all of us are probably using online ordering more than we did in the past.
Speaker 3: And so we believe some of that behavior is going to persist. And therefore, we believe CMP will remain somewhat elevated. Debit and credit mix has largely come back to pre-COVID level. So we factor that into our thinking. And then I would just call out on the COG side, as I mentioned in the script, we have
Of that into our thinking and then I would just call out on the Cogs side as I mentioned in the script we have.
Speaker 3: elevated freight costs and we believe that's going to persist for the near term. We're keeping an eye on it, of course.
Elevated freight costs and we believe that's going to persist for the near term, we're keeping an eye on it of course.
Speaker 3: But those are the things that come to mind when you ask a little bit about, you know, what do we think about recovery? I think we've seen, you know, Omnicron come and go, which is great. I think it shows restaurants are resilient and so we're considering that in our calculus as well.
But that's those are the things that come to mind when you ask a little bit about what do we think about recovery I think we've seen.
Omnicom come and go which is great I think it shows restaurants are resilient and so we're considering that having our calculus as well.
Yeah.
Speaker 1: Very helpful. Just just to follow up the the payback period I believe you said was 12 months.
Very helpful. Just just a follow up the the payback period I believe you said was 12 months.
Speaker 1: which is well below the pre-COVID level. So I imagine there is perhaps some positive surprise there. As you think about the future, what range are you comfortable at that trending towards, maybe over what time? Just curious if you could give us any thoughts on how we should be thinking about the payback period from here.
Which is well below the pre COVID-19 levels, so I imagine others, perhaps.
The positive surprise there as you think about the future.
What range are you comfortable.
<unk>.
That trending towards maybe over what time, just curious if you could give us any thoughts on how we should be thinking about the payback period from here.
Speaker 3: Yeah, no, I mean, we're proud of our payback. I wouldn't say it was a surprise. I think my finance team would get really mad at me if I if
Yes.
We're proud of our payback I wouldn't say it was a surprise.
I think my finance team would get really Mad at me if I if if.
Speaker 3: If we said it was a surprise, because actually it wasn't a surprise. Like, I think we are so focused on unit economics and payback periods, but we did benefit from the 1st part of the year. We had, if I say the puts and takes in the 1st part of the year, we had higher card, not present and just higher take rates. Obviously. But then you counter that with.
If we said it was a surprise because actually it it wasn't a surprise like I think we are so focused on unit economics and payback periods, but we did benefit from the first part of the year. We had if I say the puts and takes in the first part of the year, we had higher card not present and just higher take rates, obviously, but then you counter that.
<unk> with <unk>.
Speaker 3: Uh, you know, freight cost being elevated, so all those puts and takes.
Freight costs being elevated so all of those puts and takes really come into play there, but as I think about the future.
Speaker 3: really come into play there. But as I think about the future, you know, as we said in our S1, as long as our payback period is in the, you know, mid teens.
As we said in our S. One as long as our payback period is in the.
Mid teens.
Speaker 3: You know, I'm happy with that. Obviously, we're always going to do better. We're always going to try to make our operation more efficient. But I'm happy with that. So I would think about that as more of a longer term trend than what we had in 2021.
I'm happy with obviously, we're always going to do better we're always going to try to make our operation more efficient.
But I'm happy with that so I would think about that as more of a longer term trend than what we had in 2021.
Thank you.
Great. Thanks, Josh.
Speaker 1: Why don't we go to Brent Bracelen at Piper Sandler. Brent, you there?
Why don't we go to Brent <unk> of Piper Sandler front either.
Speaker 5: Guys, good afternoon. Thanks for letting me out here. Two questions if I could. Maybe Chris, we'll start with you. I'd love to hear early feedback on the Toast restaurant card, pay card, pay now, features. What have you learned so far? I know we're really early, but can be a pretty exciting and incremental lever for you over time. So I'd love to hear any sort of early feedback there on those cards. And then one quick follow up for Elaine.
Hey, guys good afternoon.
Thanks for now.
Let me I'm here two questions if I could maybe Chris will start with you I'd love to hear.
Early feedback on the toast restaurant card pay card pay now features.
What have you learned so far that we're really early but can be a pretty exciting an incremental lever for you over time, So love to hear any sort of early feedback there on those cards and then one quick follow up for arena.
Speaker 2: Can't hear you. Sorry about that. Yeah, Brent, good question. I think it's still early. I mean, we launched them in November . It's been a couple of months, not even a full quarter, but we remain really excited. We're putting a lot of investment behind those teams to make sure that those cards have a good product market fit. You know, listen, we believe in faster payments to restaurants. We believe in faster early wage access for employees. We believe those two fundamental.
Can't hear you sorry, sorry about that yeah, Brian . Good question I think it's still early I mean, we launched them in November it's been a couple of months not even a full quarter, but but we remain really excited we're putting a lot of investment behind those teams to make sure that those cards have a good product market fit.
Listen we believe in faster payments to restaurants, we believe in faster early wage access for employees. We believe those two fundamental dynamics help the restaurant industry succeed and for each restaurant operator to have better control of their financials. So they make a ton of sense, but it's early days.
Speaker 2: help the restaurant industry succeed, and for each restaurant operator to have better control of their financials. So they make a ton of sense, but it's early days. We're excited about the products and we're continuing to test and iterate and gain customer feedback and listen to our customer base about what we need to tweak to make them better and better. So stay tuned.
We're excited about the products and we're continuing to test and iterate and gain customer feedback and listen to our customer base about what we need to tweak to make them better and better so stay tuned.
Speaker 5: Perfect. And then Alina, I saved a tough one for you. If I go back and look at quarterly seasonality.
Perfect and then Elena it's a tough one for you.
If I go back and look at quarterly seasonality.
Speaker 6: We only have post COVID quarterly seasonality. And so in some regards, we have a big sequential drop in Q2. In one year, another year, we have a big sequential rise in Q2. As we kind of think about going more towards a normal environment, do you have any general sense for us how we should think about like?
We only have.
Post COVID-19 .
Seasonality and so in some regards we have a big sequential drop in Q2, and one year. Another year, we have a big sequential rise in Q2, I'm just as we kind of think about going more towards a normal environment to have any general sense for us how we should think about like core.
Speaker 6: quarter to quarter seasonality of the business, given it's been so dynamic the last couple of years.
Of course seasonality of the business given its been so dynamic the last couple of years now.
Speaker 3: Yeah, no, Brent, that's a really good question. I had to go back and myself for the reason you described and it was before my time. But I think the thing we'll call out is...
Now Bronco. So it really good question I had to go back and myself for the reason you described than it was before my time, but.
But I think the the thing we will call out is.
Speaker 3: Q2 and Q3 summer months tend to be our high GPD per location quarters. Q1 tends to be the lower quarter. And same with Q4, you know, with the holidays and whatnot. So, warm weather gets people out. And that's why you see a lot of increase in our GPD going in Q2 and Q3. So, you should expect that more, hopefully more normal this year, you know, going into 2022. You know, and that's how we think about it too. That's how we planned. Perfect helpful color there and...
Q2, and Q3 summer months tend to be in our hygiene PV per location quarters Q1 tends to be the lower quarter on same with Q4 with.
With the holidays and whatnot so.
Warm weather gets people out and that's why you see a lot of.
Increase in our G. P V going in Q2 and Q3, so you should expect that more.
Hopefully more normal this year going into 2022.
And that's how we think about it too that's how we planned.
Perfect helpful color, there and look forward to see yet.
Speaker 1: Thanks, Brent.
Thanks Brent.
Speaker 1: Next question, let's go to Mayak Tandon from...
Next question, let's go to Max tend on from you.
Speaker 7: Thank you, Chris. You mentioned the investments in international and enterprise. Could you talk about what are the unique challenges you expect to face as you penetrate these opportunities? In other words, what are the keys to success based on your experience so far with Toast? Sure, now let's start with enterprise. So we've
No.
Thank you, Chris you mentioned the investments in international and enterprise.
Could you talk about what are the unique challenges you expect to face as you penetrate these opportunities in other words what are the key to success based on your experience so far with coast.
Now, let's let's start with enterprise.
So we've been in the enterprise space for years.
Speaker 2: and collaborating with our largest customers, it's really making sure that number one, the platform is as scalable and reliable as possible to support their needs on expansion. So that includes a lot of above store reporting, multi-level analysis of their business.
And.
Collaborating with our largest customers, it's really making sure that number one the platform is scalable and reliable as possible to support their needs on expansion. So that includes a lot of above store reporting.
Multi level analysis of their business. So it just needs we need to make sure that the platform is a core centerpiece of their architecture as they scale their businesses. So that's number one number two it's important to make sure that we've got strong Apis as I mentioned back in the IPO, We said 150.
Speaker 2: So it just needs, we need to make sure that the platform is a core centerpiece of their architecture as they scale their businesses. So that's number 1. Number 2, it's important to make sure that we've got strong APIs. As I mentioned back in the IPO, we've got 150 plus technology partners. That stitch into our platform on a daily basis.
Plus technology partners that stitch into our platform on a daily basis and large enterprises require.
Speaker 2: And large enterprises require more complexity around architecture. So they love the fact that we've got a strong partner ecosystem and strong APIs that go along with it. I'd say the third dimension is making sure that the enterprise has
More complexity around architecture. So they love. The fact that we've got a strong partner ecosystem and strong Apis that go along with it I would say the third dimension is making sure that the enterprise has strong reporting so just the data elements and the data sharing capabilities of the platform are critically important so we continue to.
Speaker 2: Strong reporting, so just the data elements and the data sharing capabilities of the platform are critically important. So we continue to invest in those pieces of the roadmap so that the enterprises have the right analytics and insights that they need to properly run their business.
To invest in those pieces of the roadmap so that the enterprises have the right analytics and insights that they need to properly run their business. So, but we're confident about our position in the mid market and enterprise space and as I referenced the win with <unk>. It allows us to really accomplish enter.
Speaker 2: So, but we're confident about our position in the mid market and enterprise space.
Speaker 2: And as I referenced the win with Sonelli, it allows us to really accomplish enterprises that are different. They could be an FSR, it could be a QSR, but the strength of the platform to support multiple segments of the restaurant industry is pretty strong.
Apprises that are different.
Different there could be an MSR it could be <unk>, but the strength of the platform to support multiple segments of the restaurant industry is pretty strong on international it's going to be early days. I mean this is more about building the proper foundation to go to market in key markets with the <unk>.
Speaker 2: On international, it's going to be early days. I mean, this is more about building the proper foundation to go to market in key markets with the product market set that helps every restaurant be successful in the early days of those international markets.
Market fit that helps every restaurant be successful in the early days of those international markets. So I'm going to temper expectations that it's going to be a foundational year and a building year for international as we put the team in place the products in place and our execution in place to make sure of that.
Speaker 2: So I'm going to temper expectations that it's going to be a foundational year and a building year for international as we put the team in place, the products in place and our execution in place.
Speaker 2: to make sure that customers have a fantastic experience. And Elena, you may want to add to that, but it's just a reminder that international is going to be the early days.
Customers have a fantastic experience and Elena you may want to add to that but.
But it's just a reminder that international is going to be the early days. So in terms of location count and driving <unk>, it's going to be.
Speaker 2: So in terms of location count and driving ARR, it's gonna be lower than perhaps obviously what we've seen in the US for years.
It's going to be lower than perhaps obviously, what we've seen in the U S for years.
Speaker 3: Yeah, I think the only thing I would add is just making sure that we get the product localized for, you know, if there's any languages that we need to consider, of course, that's important and making sure that we invest in that over the long term, but also being measured about our investment and just making sure we learn in 2022 is really important to us.
Yes, I think the only thing I would add is just making sure that we get the product localized for if theres any languages that we need to consider of course, that's important in making sure that we invest in that over the long term, but also being measured about our investment and just making sure. We learn in 2022 is really important to us.
Speaker 7: And then as a quick follow up, just given the war for talent, are you able to fire the salespeople and the engineers and other key people to be able to hit those demand targets that you've set for yourself?
And then as a quick follow up just given the war for talent are you able to hire the salespeople and the engineers and other key people to be able to hit those demand targets that you've set for yourself.
Speaker 2: Yeah, no, I mean, big shout out to our people team and our talent acquisition team. They've stayed on goal. So when we look at 2021 and the momentum going into 2022, that seems to have done a fantastic job to find the best talent in key markets and help us scale and execute. So yeah, we've been able to keep pace.
No I mean, big Shout out to our people team and our talent acquisition team they've stayed on goal. So when we look at 2021 and the momentum going into 2022.
That seems to have done a fantastic job to find the best talent in key markets and help us scale and execute so yes, we've been able to keep pace.
Thank you.
Speaker 1: Thank you. Our next question is from Steven Sheldon at William Blair. Steven, please go ahead.
Thank you. Our next question is from Stephen Sheldon with William Blair. Steven. Please go ahead.
Speaker 8: Hey, thanks. Really nice job on top line results and great to hear that you're starting to focus more on the international opportunity. Wondering if you could just talk to me about the trends you're seeing when when you first win new customers. What trends are you seeing in terms of the size of initial packages and what are some of the main products that newer customers are frequently, I guess, including when they're first signing up for TOS.
Hey, Thanks, really nice job on topline results and great to hear that you are starting to focus more on the international opportunity.
Wondering if you could just talking about the trends youre seeing.
When you first win new customers.
What trends are you seeing in terms of the size of initial packages.
What are some of the main products that newer customers are frequently I guess, including when they are signing up for dose.
Speaker 3: Yeah, I mean, I can, I can tell you, Stephen. So when we, when we have, when we look a couple of years ago, our initial, our customers was at would typically add about 2 products. That's well over 4 now. And we talked about 50% of our customers more than 4 products. The typical products are online ordering.
Yes, I can.
I can tell you Stephen so when we when we had when we look a couple of years ago. Our initial cut our customers was at would typically add about two products, that's well over for now and we talked about 50% of our customers more than core products. The typical products our online ordering.
Speaker 3: TOSCO devices, gift cards, those are all really loyalty, all really popular products.
Tesco devices gift cards, those are all really loyalty all really popular products and also with our new test for us.
Speaker 3: And also with our new customers, a lot of them are adopting the payroll product. We see the majority of our new customers adopting the payroll product. So we're excited about that. And of course, there's an opportunity to sell that to our existing install base as well.
A lot of them are adopting the payroll product, we see the majority of our new customers adopting the payroll product. So we're excited about that.
Of course, there is an opportunity to to sell that to our existing install base as well.
Speaker 8: Got it. That's helpful. And then I guess just when I think about the, you know, as we think about the sales capacity investments, I guess, where are you focusing incremental sales resources at this time? Um, has there been any shift towards maybe focusing more on, um, you know, gaining market share in existing markets versus expanding them to new markets? And we just love an update on what you're seeing in terms of sales efficiency, especially some of the markets where, um, you've been operating maybe the longest.
Got it that's helpful. And then I guess, just when I think about the as we think about the sales capacity investments I guess, where are you focusing incremental sales resources at the time.
Has there been any shift towards maybe focusing more on.
Gaining market share in existing markets versus expanding into new markets and would just love an update on what youre seeing in terms of sales efficiency, especially some of the markets where.
<unk> been operating maybe the longest.
Speaker 2: That's a good question. I mean, it's a little bit of both making sure that we're broadening our presence in newer markets and adding reps into those markets. Again, we're constantly testing and iterating how many reps it takes to accomplish our TAM goals within a market.
Yes, that's a good question I mean, it's a little bit above making sure that we're broadening our presence in newer markets and adding reps into those markets again, we're constantly testing and iterating, how many reps it takes to accomplish our tam goals within a market. So I'd say on one front.
Speaker 2: So I'd say on one front, it's again, broadening that base of reps and new markets.
Again, broadening that base of reps in new markets, but then similar to markets like New England. We continue to put reps into new England to go after deeper sections of Tam and and then really just make sure that we've got broad brand awareness within those older legacy market.
Speaker 2: But then similar to markets like New England, we continue to put reps.
Speaker 2: into New England to go after deeper sections of TAM and then really just make sure that we've got broad brand awareness.
Speaker 2: within those older legacy markets where Toast has been executing, but we can actually put more reps into it and even be more successful. So I think it comes back to the fact that...
That's where <unk> been executing but we can actually put more reps into it and even be more successful. So I think it comes back to the fact that we're still in the early days or early innings as Elena mentioned of our Tam penetration.
Speaker 2: We're still in the early days or early innings, as Elena mentioned, of our TAM penetration. Today we're 7% of the US TAM, so that gives us strong belief that there's enough demand to continue to ramp that go-to-market engine.
They were 7% of the U S. Tam so that gives us strong belief that there is enough demand to continue to ramp that go to market engine.
Great. Thank you.
Speaker 1: Thanks, Stephen. Our next question is from Dan Dola at the JUHO. Dan, please go ahead.
Thanks, Stephen our next question is from Dan <unk>.
Mizuno Dan. Please go ahead.
Speaker 2: Hey, thank you. Appreciate you taking the question. Two quick ones. I saw the take rate. I think Elena you mentioned that the tape the.
Hey, Thank you I appreciate you taking the question.
Two quick ones just I saw the take rate I think you mentioned that the tape.
Speaker 2: debit credit mix stabilized to pre-COVID. I may have misunderstood you but it looks like the take rate has been stable.
Debit credit mix stabilize to pre Covid I may have misunderstood you, but it looks like the take rate has been stable.
Speaker 2: Can you maybe give us some more detail on what's driving the stabilization and the take rate sequentially despite the shift from debit to credit? Thank you.
Sequentially can you maybe give us some more detail on.
What's driving the stabilization in the take rates sequentially. Despite.
In terms of the shift from debit to credit. Thank you.
Speaker 3: Yeah, so actually our take rate, I think, is slightly down in Q4. And that's primarily because we're getting back to normal on debit and credit. CMP is remaining elevated. And so I feel comfortable with where we are. And stable is probably a pretty solid term in terms of how we think about 2022. But I would just remind you, the beauty of the model is both.
Yes, so actually our take rate I think it's slightly down in Q4, and that's primarily because we're we're.
Getting back to normal on debit and credit our CMP is is remaining elevated and so I feel comfortable with where we are.
Stable is probably pretty pretty solid term in terms of how we think about 2022, but I would just to remind you the beauty of the model right is both.
Speaker 3: take rate, but then we also have an opportunity to monetize through SaaS. So I would just encourage you as you think about our growth, consider both the take rate, but also the SaaS ARPU as well.
Take rate, but then we also have an opportunity to monetize through SaaS. So I would just encourage you as you think about our growth consider both the take rate, but also the SaaS our pool as well.
Speaker 2: Got it. Thank you. And then just a quick follow up more from a strategic perspective, I believe NCR made an announcement last week that, you know, that they're considering alternatives. Obviously, they're a huge player with Aloha. From from, you know, obviously, you're not going to discuss any specific M&A, but is this strategy now still pretty much organic or will you be willing to look at maybe opportunities to
Got it. Thank you and then just a quick follow up more from a strategic perspective I believe.
NCR made an announcement last week.
They are considering alternatives, obviously, there is huge clear with Aloha.
From from.
If you see you're not going to discuss any specific M&A, but is the strategy now is still pretty much.
Hmm.
<unk> or will you be willing to look at maybe opportunities too.
Speaker 2: to opportunistically bolster your portfolio. Thank you.
To Opportunistically bolster your portfolio. Thank you, yes, it's a good question I mean, Dan listen I mean, our organic growth engine continues to be really strong and the teams executing.
Speaker 7: That's a good question. I mean, Dan, listen, I mean, our organic growth engine continues to be really strong and the teams executing at an extremely high level.
At an extremely high level, so I think that motion and that growth lever is going to continue will we assess strategic opportunities when we see them on the landscape, whether it's within a line of business or more broadly, perhaps like I think those opportunities will exist as a growth lever in our future.
Speaker 7: So I think that motion and that growth lever is gonna continue. Will we assess strategic opportunities when we see them on the landscape, whether it's within a line of business or more broadly? Perhaps, like I think those opportunities will exist as a growth lever in our future. We've proven that with our acquisition of ExtraChef and then also our acquisition of StratX two years ago. So we feel confident in our M&A stance, but I'll remind everybody that.
We've proven that with our acquisition of extra shifts and then also our acquisition of strategy two years ago. So we feel confident in our M&A stance.
But I'll remind everybody that the organic growth engine continues to execute extremely well and.
Speaker 7: The organic growth engine continues to execute extremely well and we're going to continue to prioritize that. Got it.
We're going to continue to prioritize that.
Got it really appreciate the color. Thanks again.
Speaker 1: Thanks, Dan. Our next question is from Andrew Bach of SMBC, Nico. Andrew, please go ahead.
Thanks, Dan.
Next question is from Andrew <unk> SMB Nikko group. Please go ahead.
Speaker 2: Hey, guys, thanks for taking my question. I set a results considering the COVID challenges that you're facing in the quarter. I want to speak to the capital business. You know, you mentioned the 100 million originated in 2021, which is pretty promising. And you also said that the long duration loans that you introduced as Spark were, you know, a key a key variable in, you know, that accelerating growth. I mean, how much of that contributed to the 100 million if you contextualize it in.
Hey, guys. Thanks for taking my question.
Set of results considering the COVID-19 challenges that youre facing in the quarter I wanted to speak to the capital business.
You mentioned the $100 million originated in 2021, which is pretty promising and you.
You also said that the long duration loans that you introduced at spark work.
<unk> a key variable in.
That accelerated growth.
That contributed to the $100 million you could contextualize it in May.
Speaker 2: maybe higher level, what percentage would you, or kind of, how should we think about what's addressable within your base for that product?
Maybe higher level.
What percentage would you or kind of how should we think about what's addressable within your base for that product.
Yes, good question I think.
Speaker 7: If you step back into the shoes of a restaurant, restaurants desire capital to run their
If you step back into the shoes of a restaurant.
Restaurants desire capital.
Speaker 7: They want to have working capital. They want to grow whether it's new locations or renovate or add a patio. They want to purchase equipment. Or they may need emergency funding. So we actually think capital is deeply strategic to help the restaurant industry thrive moving forward. I'm having multiple products.
To run their business.
Wanted to have working capital.
To grow whether it's new locations or renovate or add a patio and they want to purchase equipment or they may need emergency funding. So we actually think capital is deeply strategic to help the restaurant industry thrive moving forward.
Having multiple products within lending is key because it's not one size fits all so youre going to see us continue to innovate and test different types of products within <unk> capital.
Speaker 7: within lending is key because it's not one size fits all. So you're going to see us continue to innovate and test different types of products within Toast Capital. It's still the early days of what Toast Capital could be as a percentage of our entire business.
It's still the early days of what toast capital could be as a percentage of our entire business. So we're not going to give you sort of are the splits between products, but we know that we are on the right path.
Speaker 7: So we're not going to give you sort of the splits between products, but we know that we are on the right.
Speaker 7: With what we're seeing, and we feel like we've got a significant advantage because we have all the data that flows through the restaurant. So that allows us to effectively underwrite. Restaurants and really have visibility into the effectiveness and then the payback on those loans.
With what we're seeing and we feel like we've got a significant advantage because we have all the data that flows through the restaurants. So that allows us to effectively underwrite restaurants, and really have visibility into the effectiveness and then the payback on those loans. So we feel like we're in a strong position we're going to.
Speaker 7: So we feel like we're in a strong position. We're gonna continue to invest in this aspect of the business, but I'll remind you it's still a small portion of the business today.
To invest in this aspect of the business, but I'll remind you it's still a.
A small portion of the business today.
Speaker 2: Definitely understood. Then my follow up would be, you know, the four plus module adoption, you know, rising 10 points from from last year's is obviously super impressive. I mean, how should we think about where that metric goes, be it in 2022 and maybe in the long term.
Oh definitely understood.
A follow up would be the four plus module adoption.
Rising 10 points from from last year is obviously super impressive I mean, how should we think about where that metric goes.
In 2022, and maybe in the long term.
Speaker 3: Yeah, I mean, I think that's a really good question. I would say our ARPU growth will be steady, but having a steep growth is probably not the way I would model it. I would just plan for steady improvement in our ARPU over time. And that's with the innovation we have today, not to mention the innovation that's coming. So that's how I would think about it, Andrew. And then on toast capital, the only thing I would add is
Yeah, I mean, I think that's a really good question I would say, our <unk> growth will be steady, but having.
A steep.
<unk> growth is probably not the way I would model. It I would just plan for steady improvement in our <unk> over time and Thats with the innovation, we have the day not to mentioned the innovation that's coming so that's how I would think about it Andrew and then on <unk> capital is the one thing I would add is.
Speaker 3: The growth we've seen is obviously we're very encouraged by it. Chris was right, it's early days. The impact to our financials is not material today. But what we love about that program is we're testing and learning, right? We're testing and learning each time. So we started out with 90 day loans, now we're testing longer duration loans. And that's a motion that we're gonna continue to try to do as we expand what's possible with Coast Capital.
The growth that we've seen is obviously, we're very encouraged by our Christmas right. It's early days the impact to our financials as is not material today, but what we love about.
That program is we're testing and learning we're testing and learning each time. So we started out with 90 day loans now were testing longer duration loans and Thats a motion that we're going to continue to try to do as we expand what's possible with <unk> capital.
Got it thank you for the color guys.
Speaker 1: Thanks, Andrew. Our final question comes from Karthik Mehta of North Coast Research. Karthik, please go ahead. Thank you. I'm wondering for you, as you've had so much success, what the competition has done and if they've done anything different in the last six months.
Thanks, Andrew or final question comes from Kartik Mehta of Northcoast Research. Please go ahead. Thank.
Thank you I'm wondering.
For you is you've had so much success.
The competition has done and if they've got anything different in the last six months.
Speaker 7: Yeah, I can take that. I mean, listen, as I mentioned earlier, the restaurant industry has been underserved by great technology. So it's no surprise that there's been competition for the past 10 years. I mean, it's a competitive space. But what I like about our position is, number one, we're seeing really strong demand for the platform. And that's a very good signal for us to continue to execute. Number two, we're seeing healthy win rates. And you're seeing strong payback.
Yes, I can take that I mean listen.
As I mentioned earlier.
The restaurant industry has been underserved by great technology. So it's no surprise that there has been competition for the past 10 years I mean, it's a competitive space, but what I like about our position is number one we're seeing really strong demand for the platform and that's a very good signal for us.
To continue to execute number two we're seeing healthy win rates and youre seeing strong payback periods healthy win rates. So that gives us even more confidence in our execution. So while there is competition. We feel like we are the leading platform to help the restaurant industry grow and and it comes back to the platform.
Speaker 7: healthy win rate.
Speaker 7: So that gives us even more confidence in our execution. So while there's competition, we feel like we are the leading platform to help the restaurant industry grow. And it comes back to the platform, being an end-to-end restaurant specific.
Being an end to end restaurants specific platform, that's not multi product, but as a true platform across the board from front of house back of House. That's a key success factor and we're going to continue to execute on that path. So we feel good about our position within the competitive landscape and and while there has been.
Speaker 7: platform that's not multi-product but is a true platform across the board from front of house to back of house.
Speaker 7: That's a key success factor, and we're going to continue to execute on that path. So we feel good about our position within the competitive landscape. And and while there's been announcements. Over time, I mean, there's been announcements for the past few years on the competitive landscape of restaurants.
Announcements over time, I mean, there has been announcements for the past few years on the competitive landscape of restaurants, but but we just continue to execute and raise the bar and support our customers at the end of the day, we want to make sure that every customer has a fantastic experience when they run toast.
Speaker 7: But but we just continue to execute and raise the bar and support our customers at the end of the day. We want to make sure that every customer has a fantastic experience when they run toast.
Perfect. Thank you very much I appreciate it.
Speaker 1: Well, all right, everyone, thank you very much. That concludes our call. We look forward to speaking with you all next quarter and have a great afternoon. Thank you all.
Well alright, everyone. Thank you very much that concludes our call.
We look forward to speaking with you all next quarter.
A great afternoon.
Thank you all.