Q1 2022 Boxed Inc Earnings Call

May 10, 2022

implied in any forward-looking statements made today. Management's remarks today will include non-GAAP or adjusted financial measures. Reconciliations of GAAP results to non-GAAP financial measures are available in the earnings release.

Looking statements made today.

Managements remarks today will include non-GAAP or adjusted financial measures reconciliations of GAAP results to non-GAAP financial measures are available in the earnings release. This call is being webcast and an archive of it will be made available on <unk> Investor Relations website, now I'd like to turn the call over to Jay.

It's called Being Web Guest in an Archive of It will be made available on Box Investor Relations' website. Now, I'd like to turn the call over to Jay.

Thanks, Chris. And hi again, everyone. I'm very proud of what our team has accomplished so far in 2022, building on the momentum from the last time we

Thanks, Chris and Hi, again, everyone I am very proud of what our team has accomplished so far in 2022 building on the momentum from the last time, we can be.

I'm going to first provide some recent updates on our business, and then Mark is going to discuss our Q1 financial results in greater detail, as well as our outlook for 2022. After that, we'll open up the call for questions.

I'm going to first provide some recent updates on our business and then Mark is going to discuss our Q1 financial results in greater detail as well as our outlook for 2022.

After that we'll open up the call for questions.

If you remember as we debuted as a public company last year, we discussed a few key themes amongst others. We were excited about how the capital infusion as well as increased awareness could benefit box.

If you remember, as we debuted as a public company last year, we discussed a few key themes amongst others. We were excited about how the capital infusion, as well as increased awareness, could benefit Bach.

We also discussed how B2B recovery would be one of the keys to our business, since it is one of our more profitable and stickier customer cohorts.

We also discussed how <unk> recovery would be one of the keys to our business. Since it is one of our more profitable and stickier customer cohort.

I'm happy to provide updates on these fronts, plus more today. I'm thrilled that the trends we're seeing in our B2B cohort after two years of variability related to COVID.

I'm happy to provide updates on this front plus more today.

Thrilled that the trends, we're seeing in our <unk> cohort after two years of variability related to Covid BTB customer <unk> for the quarter grew 65, 4% year over year.

B2B customer GMB for the quarter group 65.4% year over year. We're capitalizing on this return to work shift by deploying more dedicated sales and marketing efforts towards B2B and remain focused on the industry verticals where we've had excellent traction to date.

We're capitalizing on this return to work shifts by deploying more dedicated sales and marketing effort towards <unk> and remained focus on the industry verticals, where we have had excellent traction to date.

We also saw good growth in overall GMB, growing by almost 20% year over year. 19.2% to be exact.

We also saw good growth in overall GMB growing by almost 20% year over year 19, 2% to be exact.

On the net revenue front, we're seeing reacceleration there as well. First quarter net revenue increased 14.1% compared to the prior year period.

On the net revenue front, we're seeing reacceleration there as well.

First quarter net revenue increased 14, 1% compared to the prior year period.

We've done all of this while increasing gross profit 27.3% year over year and gross margin to 13.1% for the quarter.

We've done all of this while increasing gross profit 27, 3% year over year and gross margin to 13, 1% for the quarter.

regarding margin cost savings and partnerships, we're excited to expand our commercial partnership with FedEx.

Regarding margin cost savings and partnerships, we're excited to expand our commercial partnership with Fedex at.

At a time when all you're hearing about is cost increases and inflation we feel incredibly fortunate to be able to announce a partnership which will not only provide us with transportation cost savings but will also improve service levels to all of our customers.

At a time when all you're hearing about as cost increases and inflation, we feel incredibly fortunate to be able to announce the partnership which will not only provide us with transportation cost savings, but will also improve service levels to all of our customers.

It's a real testament to the entire team's dedication to delivering convenience, value, and savings to our end customers.

It's a real testament to the entire team dedication to delivering convenience value and savings to our end customers.

Now, going back to our previous discussion, remember, we've also said how excited we were to have the opportunity to increase awareness by investing in our brand.

Now going back to a previous discussion remember we've also said how excited we were to have the opportunity to increase awareness by investing in our brand.

As mentioned during our last earnings call in March, we recently launched new creative content across our linear and streaming video channels and have begun a more holistic rollout of our brand messaging across all marketing channels.

As mentioned during our last earnings call in March we recently launched new creative content across our linear and streaming video channels and have begun a more holistic rollout of our brand messaging across all marketing channels.

As a result of these efforts, based on our ongoing survey results, aided brand awareness has approximately doubled during the first quarter of 2022, compared to the levels we were seeing throughout 2021.

As a result of these efforts based on our ongoing survey results aided brand awareness has approximately doubled during the first quarter of 2022 compared to the levels, we were seeing throughout 2021.

While we were starting from a low base, this illustrates that our marketing strategy is already working, and we expect to build on this momentum throughout the

While we were starting from a low base. This illustrates that our marketing strategy is already working and we expect to build on this momentum throughout this year.

This awareness, we believe will be a factor in helping bolster our active customer count.

This awareness, we believe, will be a factor in helping bolster our active cut.

We're seeing positive trends on that front as active customer accounts stood at about 161,000 at the end of the first quarter. This represents a quarter over quarter increase of more than 11,000 customers.

We're seeing positive trend on that front as active customer count stood at about 161000 at the end of the first quarter.

This represents a quarter over quarter increase of more than 11000 customers.

As we previously noted, this trend is important in supporting subsequent quarter over quarter GMB and retail net revenue growth, something we're focused on throughout 2022.

As we previously noted this trend is important in supporting subsequent quarter over quarter, GMB and retail net revenue growth something we're focused on throughout 2022.

Other items we've discussed in the past are AOV and repeat behavior. As stated before, we believe our product expansion efforts will be important to improving both of these metrics.

Other items, we've discussed in the past, our <unk> and repeat behavior.

As stated before we believe our product expansion efforts will be important to improving both of these metrics.

However, as we add assortment, improving product discoverability will become increasingly important.

However, as we add assortment improving product discover ability will become increasingly important.

As such, we fully revamp the taxonomy on our properties, which will support continued growth as we bring on more third-party sellers.

As such we fully revamped the taxonomy on our properties, which will support continued growth as we bring on more third party sellers.

You'll begin to notice new general merchandise categories, expanded pet assortment, and even more organic products.

You'll begin to notice new general merchandise category expanded assortment and even more organic products.

From a metric standpoint, <unk> for the last few quarters have been hovering in the $130 range, which is up more than 16% versus the prior year period.

From a metric standpoint, AOVs for the last two quarters have been hovering in the $130 range, which is up more than 16% versus the prior year.

Beyond that, we're seeing order frequencies increase across our active customer base, which means our wallet share is also increasing, a trend we feel bullish.

Beyond that we're seeing order frequencies increase across our active customer base, which means our wallet share is also increasing a trend we feel bullish about.

I'd also like to provide you with an update on our first acquisition, Max Delivery.

I'd also like to provide you with an update on our first acquisition Max delivery.

As a reminder, Mac delivery offers 10,000 products including fresh and frozen foods delivered from a dark store environment in under an hour.

As a reminder, Max delivery offers 10000 products, including fresh and frozen foods delivered from a dark store environment in under an hour.

The business continues to perform in line with our expectations as we invest behind marketing acquisition spend to grow the customer base here in Manhattan.

The acquisition has benefited our customers in New York by expanding access to fresh groceries and on demand one hour delivery.

The acquisition has benefited our customers in New York by expanding access to fresh groceries and on-demand one-hour delivery.

were on track to fully integrate Mac delivery operations with box by the end of the

We're on track to fully integrate Max delivery operations with box by the end of this year.

We look forward to expanding the service to new locations and to more of our customers, and we're in active negotiations for several new locations, which we expect to launch during Q3 and Q4 of this.

We look forward to expanding this service to new locations and to more of our customers and we are in active negotiations for several new locations, which we expect to launch during Q3 and Q4 of this year.

Turning to the software and services business over the last couple of months, we've been focused on development to the underlying technology platform and building the infrastructure to support broader scalability.

In addition, we've recently deployed our payment on delivery functionality. We launched this feature first for Eon Malaysia, but we believe it's an important capability as we consider expansion into other emerging markets where a large portion of the population still prefers to pay upon delivery.

In addition, we recently deployed our payment on delivery functionality. We launched this feature first for E on Malaysia, but we believe it's an important capability as we consider expansion into other emerging markets, where a large portion of the population still prefers to pay upon delivery.

We think this will provide us with yet another competitive advantage when attracting customers in other emerging markets across the globe.

We think this will provide us with yet another competitive advantage when attracting customers and other emerging markets across the globe.

Now, let's talk team.

From day one, it's been not just me, but our entire team that has delivered results.

From day, one it's been not just me, but our entire team that has delivered results.

Being so, it's key that we continue to invest in the right people here at Box in order to ensure we maintain a world-class

Being so it's key that we continued to invest in the right people hear box in order to ensure we maintain a world class team.

In 2022, we've already expanded our leadership team through the addition of industry veterans across key positions, including general counsel, chief people officer, chief revenue officer, vice president of merchandising, and vice president of strategic growth for our software and services.

In 2022, we've already expanded our leadership team through the addition of industry veterans across key positions, including General Counsel Chief People Officer, Chief Revenue Officer, Vice President of merchandising and Vice President of strategic growth for our software and services business.

Jung Choi, general counsel was previously vice president, assistant general counsel and assistant secretary at Stanley Black and Decker, overseeing public company reporting, securities regulation, corporate governance, and its ESG shareholder engagement strategy.

John Choi General Counsel was previously Vice President Assistant General Counsel and assistant Secretary at Stanley Black <unk> Decker overseeing public company reporting securities regulation, corporate governance, and ESG shareholder engagement strategy.

Vero Salvega, Chief People Officer, was previously Chief People Officer at Residence, a direct-to-consumer technology-driven company.

Parallel Vega Chief people officer with previously Chief people officer at residents of direct to consumer technology driven company.

Anna Meyer, Chief Revenue Officer for our Software and Services business, previously led sales at SESL, a fast-growing fintech.

And a myer chief revenue officer for our software and services business previously led sales at settle a fast growing Fintech company.

Elizabeth Hochberg, Vice President of Merchandising, was previously Senior Vice President of Ecommerce at Town and Country Living, and has years of leadership experience in online consumables prior to that.

Elizabeth <unk> Vice President of merchandising was previously senior Vice President of E Commerce at town and country living and had years of leadership experience in online consumable prior to that.

Chris Zhang, Vice President of Strategic Growth, was previously COO at Software Provider Dynamo Technology.

Chris Chang Vice President of strategic growth was previously.

At software provider Dynamo technology.

We're honored to have this collective force of talent with such an impressive and eclectic background. Join our growing company.

We're honored to have this collective fourth of talent with such an impressive and eclectic background join our growing company.

Lastly, helping the world stock up through our technology is our stated mission.

help has multiple meanings here, and doing good has always been at the core of box.

Help had multiple meetings here and doing good has always been at the core box.

I'd like to take a moment to say that on behalf of all of us at Vox, our hearts go out to everyone suffering because of the Russia-Ukraine war. It's very important that we...

I'd like to take a moment to say that on behalf of all of US at box. Our Hearts go out to everyone's suffering because of the Russia, Ukraine more.

It's very important that we do our part as well.

We donated 100% of profits over a two day period in March to the Ukrainian relief effort and are actively working to enable inventory storage and supply chain support out of our fulfillment.

We donated 100% of profits over a two day period in March to the Ukrainian relief efforts and are actively working to enable inventory storage and supply chain support out of our fulfillment centers.

As you can tell, 2022 is a very exciting year.

As you can tell 2022 is a very exciting year for us.

We feel we're differentiated and well positioned in this dynamic and changing world.

Our B2C business can help customers save in bulk as inflation rises. Our B2B business is ready to serve our customers as a post-COVID world returns to normal. Lastly, our high-margin software and services business is yet another point of differentiation for our overall company. All of these factors make boxed.

Our BDC business can help customers save in bulk as inflation rises our <unk> business is ready to serve our customers as a post COVID-19 world returns to normal lastly, our high margin software and services business is yet another point of differentiation for our overall company.

All of these factors make box unique.

With that let me hand, it over to Mark.

Thank you so much Jay we are pleased with what we have accomplished so far in 2022 and it will start off by reviewing our financial results for the first quarter.

Thank you so much, Jay. We are pleased with what we have accomplished so far in 2022. And we'll start off by reviewing our financial results for the first quarter.

Net revenue is 46.6 million, an increase of 14.1% or 5.8 million compared to the prior year period.

Net revenue was $46 6 million, an increase of 14, 1% or $5 8 million compared to the prior year period.

The increase was primarily due to strengthening B2B customer demand and retail combined with the year-over-year software and services growth.

The increase was primarily due the strengthening DDB customer demand and retail combined with the year over year software and services growth.

For the retail segment net revenue was $44 4 million, an increase of 11, 3% or $4 5 million compared to the prior year period.

For the retail segment, net revenue is $44.4 million, an increase of 11.3% or $4.5 million compared to the prior year period.

The increase was largely due to increasing overall customer engagement increased <unk> demand and the marketing investments, we've been making to support sequential active customer growth.

The increase was largely due to increasing overall customer engagement, increased B2B customer demand, and the marketing investments we have been making to support sequential active customer growth.

In terms of customer engagement, we're excited to be seeing year-over-year growth across both our average order values as well as our order

In terms of customer engagement, we're excited to be seeing year over year growth across both our average order values as well as our order frequency, which combines are yielding strong overall wallet share increases.

which, combined, are yielding strong overall law at Sharon.

When we blend those two complementary dynamics together, you can see the impact through our retail net revenue per active customer, or our PAC, which was a new disclosure that we added to our KPIs, but also a metric that we spoke to last quarter.

When you blend those two complementary dynamics together you can see the impact through our retail net revenue per active customer or our pack, which was a new disclosure that we added to our kpis, but also a metric that we spoke to you last quarter.

In the first quarter, our pack was $276, an increase of $67 or 32.4% compared to the prior year period.

In the first quarter are packed with $276, an increase of $67 or 32, 4% compared to the prior year period.

Well, growth in B2B customer demand and order mix is supporting some of the ARPAC increase. We're also actually seeing a nice AOV and order frequency left within our B2C customer co-op as well.

While growth in <unk> customer demand and order mix is supporting some of the <unk> increase we're also actually seeing a nice <unk> and order frequency within our BDC customer cohort as well.

Turning the B2B for a minute, as she mentioned earlier, we continue to see positive momentum from miscustomer base.

Turning to <unk> for a minute as she mentioned earlier, we continue to see positive momentum from this customer base.

For two quarters in a row now, B2B has been growing in the 60% to 65% range over here, with first quarter B2B GMD growth of 65.4% compared to the first quarter of last year.

Two quarters in a row now <unk> has been growing in the 60% to 65% range year over year with first quarter <unk> growth of 65, 4% compared to the first quarter of last year.

Year to date, the return to office momentum we began seeing in Q4 2021 has been sustaining and it is proving to be a nice growth catalyst in retail.

Year to date the return to office momentum, we began seeing in Q4 of 2021 has been sustaining and it is proving to be a nice growth catalyst in retail.

From an investment standpoint, we're also leaning in actively expanding our dedicated <unk> team highly focused on capturing this ever increasing VW demand.

From an investment standpoint, we are also leaning in, actively expanding our dedicated B2B team, highly focused on capturing this ever-increasing B2B demand.

As we have discussed in the past, we are particularly excited about the re-emergence of our B2B customer base, because compared to our B2C customer, on average, they're spending over three times more per quarter, and on top of that, they're a stickier and more profitable customer base.

As we've discussed in the past we are particularly excited about the reemergence of our <unk> customer base, because compared to our BDC customer on average they are spending over three times more per quarter and on top of that there are stickier and more profitable customer.

Finally, on retail, we have consistently communicated the importance of marketing and our growth strategy for 2022.

Finally on retail we have consistently communicated the importance of marketing in our growth strategy for 2022.

We've increased our investments there and are now sustaining marketing spend at levels we believe are appropriate for our size and maturity.

We've increased our investments there and are now sustaining marketing spend at levels. We believe are appropriate for our size and maturity.

The increased budget has enabled us to test into new channels and the supporting increasing brand awareness, which as she noted, double this quarter compared to levels seen throughout 2021.

The increased budget has enabled us to test into new channels and are supporting increasing brand awareness, which as Jay noted doubled this quarter compared to levels seen throughout 2021.

During the first quarter, we spent 11.7 million on advertising, of which approximately 1.2 million related to content production costs, which were fully expense during Q1, and as a result, we do not expect those to continue throughout the year.

During the first quarter, we spent $11 $7 million on advertising of which approximately $1 $2 million related to content production costs, which were fully expense during Q1 and as a result, we do not expect those to continue throughout the year.

Otherwise though, we expect to generally sustain marketing investment at these levels over the course of the year with some minor variability from quarter to quarter.

Otherwise, though we expect to generally sustained marketing investment at these levels over the course of the year with some minor variability from quarter to quarter.

Turning now to the software and services segment, we generated $2 2 million in net revenue in the first quarter, which increased $1 2 million or 127, 1% year over year and beat our internal expectations.

we generate 2.2 million in that revenue in the first quarter, which increased 1.2 million, or 127.1% year-over-year, and beat our internal access.

As we previously discussed, timing of revenue recognition within this segment will remain variable from quarter to quarter while we scale. And as such, we are highly focused on the long term potential and opportunity for growth versus near term quarter to quarter results.

As we previously discussed timing of revenue recognition within this segment will remain variable from quarter to quarter, while we scale and as such we are highly focused on the long term potential and opportunity for growth versus near term quarter to quarter results.

Further, as we add more customers to our software portfolio, increasing the recurring revenue mix will help support more revenue predictability from period to period in the future.

Further as we add more customers to our software portfolio, increasing the recurring revenue mix will help support more revenue predictability from period to period in the future.

As Shane mentioned, we've had some exciting technology enhancements within our software offerings and we are confident in our strong customer pipeline, expecting to be able to provide more positive updates there in the coming months.

As Shane mentioned, we've had some exciting technology enhancements within our software offerings and we are confident in our strong customer pipeline expecting to be able to provide more positive updates there in the coming months.

In addition, we are seeing positive trends within our profitability as gross profit of $6 1 million in the first quarter increased by $1 2 million or 23, 7% versus the prior year period and gross margin came in at 13, 1%, a 101 basis point increase from 12, 1%.

In addition, we are seeing positive trends within our profitability as growth profit of 6.1 million in the first quarter increased by 1.2 million or 23.7% versus the prior year period and growth margin came in at 13.1%, 101 basis point increased from 12.1% in Q1 of 2021.

In Q1 of 2021.

The margin expansion resulted from an increase in net revenue mix from the higher-margin software and services sector.

The margin expansion resulted from an increase in net revenue mix from the higher margin software and services segment.

Retail growth margin of approximately 10% remained relatively flat year-to-year, and we were pleased with the performance there, giving the inflationary environment and macro-driven headwinds across products and transportation.

Retail gross margin of approximately 10% remained relatively flat year over year and we are pleased with the performance there given the inflationary environment and macro driven headwinds across product and transportation costs.

Further, our exciting new partnership with SED-X is expected to yield transportation cost savings, not only combating inflationary trends, but also supporting better seven-day service levels through our end-to-end.

Further our exciting new partnership with Fedex is expected to yield transportation cost savings not only combating inflationary trends, but also supporting better seven day service levels to our end customers.

We believe that between this new transportation cost structure, the continued growth of our third party marketplace business, the proliferation of B2B and the significant opportunities we see to increase advertising revenue and vendor trade. We continue to expect nice retail margin expansion this year and significant increases over the medium to long.

We believe that between this new transportation cost structure. The continued growth of our third party marketplace business.

Liberation of VW and the significant opportunities, we see to increase advertising revenue and vendor trade. We continue to expect nice retail margin expansion this year and significant increases over the medium to long term.

Our first quarter net loss was $36 2 million of which $11 million related to noncash of one time transaction related expenses.

Our first quarter net loss was $36.2 million, of which $11 million related to non-cash or one-time transaction related expense.

This compared to a loss of $14.2 million in the prior year period.

This compared to a loss of $14 2 million in the prior year period.

Adjusted EBITDA was a loss of 22.2 million compared to a loss of 11 million in the prior period, primarily due to increases in growth related and public company related investments across advertising, staff, insurance costs, and professional services.

Adjusted EBITDA was a loss of $22 2 million compared to a loss of $11 million in the prior period, primarily due to increases in growth related and public company related investments across advertising staff insurance costs and professional services costs.

On the KPI side, gross merchandise value was $53.4 million for the first quarter, an increase of $8.6 million or 19.2% versus the prior year period, showing strong reacceleration on both a quarter over quarter and year over year basis.

On the API side gross merchandise value was $53 4 million for the first quarter, an increase of $8 6 million or 19, 2% versus the prior year period, showing strong a reacceleration on both a quarter over quarter and year over year basis.

Finally, we are pleased with the continued upward trajectory of our average order values, with first quarter AOV of $130, an increase of $19 or 16.6% compared to the prior year period.

Finally, we are pleased with the continued upward trajectory of our average order values with first quarter <unk> of $130, an increase of $19 or 16, 6% compared to the prior year period.

There are several factors helping support this increase, including an increase in B2B customer order mix, expanding assortment, and ongoing price optimization.

There are several factors, helping support this increase including an increase in BWI customer order mix.

Spanning assortment and ongoing price optimization.

Turning now to our balance sheet.

At the end of the first quarter, we had a cash balance of $72.7 million, increases of $2.8 million in restricted cash, which will help support our investments in marketing, technology, and software and services over the course of the year.

At the end of the first quarter, we had a cash balance of $72 7 million inclusive of $2 8 million in restricted cash, which will help support our investments in marketing technology and software and services over the course of the year.

In addition, we had 58.2 million on the balance sheet in the form of a forward purchase receivable, which we have been collecting on throughout the year, and which we hope will continue to collect on over the coming quarters.

In addition, we had $58 $2 million on the balance sheet in the form of a forward purchase receivable, which we have been collecting on throughout the year and which we hope will continue to collect on over the coming quarters.

Finally, as you may have seen, we recently issued an 8K announcing a three-year, $100 million committed equity financing facility with Jones Trading.

Finally, as you may have seen we recently issued an 8-K announcing a three year $100 million committed equity financing facility with Jones trading.

Subject to the terms of the facility, at our option, we will be able to draw on that facility over time, which we expect will provide additional flexibility to raise equity capital, helping further support our future liquidity needs.

Subject to the terms of the facility at our option, we will be able to draw on that facility over time, which we expect will provide additional flexibility to raise equity capital helping to further support our future liquidity needs.

Our total debt principal remains at $132 5 million.

Our total debt principle remains at $132.5 million, of which $87.5 million is related to convertible debt.

Of which $87 5 million is related to convertible debt.

Finally, turning to our outlook for full year 2022.

We are maintaining the guidance we provided last quarter, as well as the trends and quarterly trajectory that we discussed in detail on our last turnout.

We are maintaining the guidance, we provided last quarter as well as the trends in quarterly trajectory that we discussed in detail on our last earnings call.

We continue to expect net revenue in the range of 220 to 245 million with an adjusted EBITDA loss in the range of 70 to 80 million.

We continue to expect net revenue in the range of $220 million to $245 million with an adjusted EBITDA loss in the range of $70 million to $80 million.

In addition, we are now also providing guidance for software and services revenue of 15% to $23 million for fiscal year, 2022, which we expect to be heavily weighted in the second half of the year.

In addition, we are now also providing guidance for software and services revenue of $15 to $23 million for fiscal year 2022, which we expect to be heavily weighted in the second half of the year.

I do want to continue to stress that the timing of revenue recognition in the segment will remain variable in the near term, given the nature of the enterprise partnerships we are negotiating and deploying.

I do want to continue to stress that the timing of revenue recognition in this segment will remain variable in the near term given the nature of the enterprise partnerships, we are negotiating and deploy.

Overall, we feel great about the first quarter results, we re accelerated topline growth expanded gross margin profitability have seen improvements in customer engagement increased awareness of our brand and finally announce some exciting new partnerships, which are expected to deliver cost savings and support future.

Overall, we feel great about the first quarter results. We've re-accelerated top-line growth, expanded gross margin profitability, have seen improvements in customer engagement, increased awareness of our brand, and finally announced some exciting new partnerships, which are expected to deliver both cost savings and support future liquidity.

Accredited.

Looking forward there are so many growth avenues for us on the horizon between continuing to scale will be to see the momentum we're seeing in <unk> and the massive potential we see for our software and services segment 2022 is such an exciting year for us.

Looking forward, there are so many growth avenues for us on the horizon. Between continuing to scale B2C, the momentum we're seeing in B2B, and the massive potential we see for our software and services segment, 2022 is such an exciting year.

With that, our focus remains on making the appropriate investments to enable Scow and to deliver long-term value for all of our

With that our focus remains on making the appropriate investments to enable scale and to deliver long term value for all of our stakeholders.

Thank you all, and let me turn the call back over to Che for some final remarks.

Thank you all and let me turn the call back over to Jay for some final remarks.

Thanks Mark. We're well positioned for success as we're capitalizing on this changing consumer environment. We're investing in the growth of our B2C and B2B platforms, where we plan to drive customer acquisition, further enhance our loyalty program, thoughtfully expand our product assortment, and are making strategic investments to fuel sustainable, long-term growth for stockholders over the long run.

Thanks, Marc we are well positioned for success as we are capitalizing on this changing consumer environment, we're investing in the growth of our <unk> platform, where we plan to drive customer acquisition further enhance our loyalty program thoughtfully expand our product assortment and are making strategic investments to fuel sustainable long term growth for stockholder.

Over the long term.

So with that, we're now available to take your questions. Operator?

So with that we're now available to take your questions operator.

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Before we enter into the queue.

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The first question is from the line of Brian Fitzgerald with Wells Fargo. Please proceed.

Thanks, guys. A couple of questions. You mentioned aided brand awareness double. Just wondering if you could give us a sense of the absolute level of aided awareness or maybe relative awareness versus some of your larger peers in the market. And then really nice recovery on the B2B GMB in the quarter. Any sense on how many of your large.

Thanks, guys couple.

Couple of questions you mentioned aided brand awareness double just wondering if you could give us a sense of the absolute level of aided awareness or maybe relative awareness versus some of your larger peers in the market and then really nice recovery on the <unk> in the quarter any sense on how many of your large.

Customers have ramped back to pre-pandemic levels or how much opportunity remains to kind of recapture normalized volumes with existing customers. Thanks.

Customers have ramped back to prepay mimic levels are or how much opportunity remains to kind of recapture normalized volumes with existing customers.

Thanks.

Hey Brian , thanks so much. So I'll start with the B2B question and then I'll turn it over to Che for the awareness point.

Hey, Brian . Thanks, so much so I'll start with the <unk> question, and then I'll turn it over to Jay for that awareness point.

On B2B, I think we're seeing a combination of everything sort of happening at the same time. Certainly, we're seeing user growth on a quarter over quarter and year over year basis. We're also seeing as we had kind of discussed last quarter, you know, the actual customer engagement on the B2B side has basically returned and actually outpaced

<unk> I think we're seeing a combination of everything is sort of happening at the same time, certainly we are seeing user growth on a quarter over quarter and year over year basis. We're also seeing as we kind of discussed last quarter. The actual customer engagement on the <unk> side has basically returned it actually outpace.

what we were seeing in in pre-pandemic levels. So those customers are now spending about 3x or a little more than 3x more than our B2C customer base. They're ordering more frequently. The AOBs have returned well above actually what we were seeing pre-pandemic there as well. So those are growing really nicely. So it's kind of all just hitting us at once and that's what you're seeing in the underlying growth of the GMB side. When we look at that 65% year over year and

What we were seeing pre pandemic levels. So those customers are now spending about <unk> are a little more than <unk> more than our <unk> customer base, they're ordering more frequently.

<unk> have returned well above actually what we were seeing pre pandemic there as well. So those are growing really nicely. So it's kind of all just hitting us at once and Thats, what youre seeing in the underlying growth of the <unk> side, when we look at that 65% year over year increase.

If it's it's right here on the the branded awareness or the aided awareness study point. So every month we do an internal study. So we go out to about 2000 respondents.

Hey, it's Jay here on the.

The branded awareness or the aided awareness.

30 points. So every month, we do a internal studies. So we go out to about 2000 respondents for each survey each month. So the sample is taken.

for each survey each month so the sample taken at random on online mobile network.

At random on online mobile network.

or online ad network and overall, in exchange for taking the survey, they get in-app rewards on the app that they're currently using at the time, so it's U.S. only.

All mine at network and overall in exchange for taking the survey they get in App rewards on the App that they are you currently using at the time, So it's U S only.

We haven't disclosed what the exact number is previously, but I'm happy to say that it was from this internal survey, it had jumped from 4% to 8% as a whole number. So, of course, 8% still is much lower than some of our much larger peers when it comes to selling in the categories that we do sell. But with that said, whenever you're seeing a doubling of a number when it comes to awareness, I think you're starting to see these KPIs move in the right direction. Yeah. Guys, thanks, Shay. Thanks, Mark.

We haven't disclosed what the exact number is previously but I'm happy to say that it was.

From this internal survey it had jumped from 4% to 8% at the whole number so of course, 8% still is much lower than some of our much larger peers. When it comes to selling in the categories that we do sell but with that said whenever youre seeing a doubling up of a number when it comes to awareness I think youre starting to see.

These these kpis move in the right direction.

Yes.

Got it thanks, Jay Thanks, Mark.

Thank you Mr Fitzgerald.

The next question is from the line of Ron Josie with City, please proceed.

The next question is from the line of Ron Josey with Citi. Please proceed.

Great, thanks for asking that. Thanks for taking the question. I wanted to ask, I think I heard order frequency is increasing, coming up to levels that you hadn't seen before. I just wanted to see how does that order frequency compared to pre-COVID, I guess, is the first question. And then on the new FedEx partnership, can you talk a little bit more just about the benefits of this partnership, the impact of shipping times and things along those lines? I know you talked about it in the preamble, but just more details on the FedEx partnership. Thanks, guys.

Alright, thanks for asking that thanks for taking the question I wanted to ask I think I heard order frequency is increasing.

Coming up to levels that you haven't seen before I just wanted to see how does that order frequency compared to pre Covid I guess, the first question and then on the.

The new Fedex partnerships with can you talk a little bit more just about the benefits of this partnership the impact of shipping times and things along those lines I know you talked about it in.

In the preamble, but just more details on the Fedex partnership Thanks, guys.

Certainly. Thanks so much, Ron. So from a order frequency standpoint, you know, what we're basically seeing is compared to pre pandemic levels, you know, overall order frequencies are relatively in line. I would say what we've seen is across sort of B2C and B2B that that dynamic has shifted over time, right?

Certainly thanks, so much Ron so from a order frequency standpoint.

What we're basically seeing is compared to pre pandemic levels. Overall order frequencies are relatively in line I would say what we've seen is a cross sort of <unk> that that dynamic has shifted over time right.

On the B2B side, what we saw was a big fall off there sort of during the pandemic and even in post periods coming off of that. And that's where we've seen, you know, a large amount of the recovery happen on the order frequency side. Now, I will say, you know, year over year on B2C, order frequency is also up pretty nicely from a from a lift perspective. So, when we look back at sort of that, you know, very nearing post pandemic environment in Q1 2021.

On the <unk> side, what we saw was a big falloff, there sort of during the pandemic and and even in post period coming off of that and that's where we've seen a large amount of the recovery happened on the order frequency side now I will stay.

Year over year on BTC order frequency is also up pretty nicely from a from a lift perspective, so when we look back at sort of that.

Very nearing post pandemic environment in Q1 2021.

You know, we, we certainly are seeing growth from that perspective as well. So I think all positive things from customer dynamics standpoint. And, you know, often when you see the increases we're seeing, you know, you may expect to counteract that with.

We certainly are seeing growth from that perspective as well. So I think all are positive things from customer dynamic standpoint, and often when you see the increases. We're seeing you don't you may expect to counteract that with lower order frequency. That's always something we're very mindful of.

lower order frequency. That's always something we're very mindful of.

What I can see is is the good news there is that it is that is not the case we're definitely seeing growth across both, which is also yielding the spend per user increases that you're seeing on the platform.

What I can see is is the good news there is that that is not the case, we're definitely seeing growth across both which is also yielding the spend per user increases that youre seeing on the platform.

Okay.

And then moving to the transportation cost question. So overall, we're not disclosing exactly what we expect the impact of that to be below what I would say is that we are anticipating some nice margin gross margin growth on the retail business over the course of this year and really the effects of.

And then moving to the transportation cost question. So, you know, overall, we're not disclosing exactly, you know, what we expect the impact of that to be, but well, what I would say is that we are anticipating some nice margin gross margin growth on the retail business over the course of this year and and really the effects of.

that agreement will start to kick in going into the back half of this quarter as well as through Q3 and Q4.

That agreement will start to kick in.

Going into the back half of this quarter as well as through Q3 and Q4, so when we think about the overall.

Partnership there, while we're really excited about that transportation cost savings on the other side of that we're quite excited about.

Seven day delivery.

<unk> that Fedex deploys, that's really going to help us deliver a better service to our customer ultimately enable scale of the retail business over time and so we're really really excited about that commercial alliance that we have with them and how that will impact the business on a go forward basis.

and how that will impact the business on a go-for basis. Great. Thank you, Chek. Thank you, Mr. Josie. Once again, to ask a question, press star one. The next question is from the line of Marvin Fong with BTIG. Please proceed. Good evening. Good evening, guys. Thanks for taking my questions. So two for me.

Great. Thank you Jack.

Great. Thank you, sir.

Yes.

Thank you Mr. Jesse.

Once again to ask a question press star one.

The next question is from the line of Marvin Fong with BTIG, please proceed.

Next question is from the line of Marvin Fong with BTG. Please proceed.

Good evening, good evening, guys. Thanks for taking my questions. So two for me, just wondering if you could

Good evening.

Good evening guys. Thanks for taking my questions. So two for me.

Just wondering if you could.

Ill.

describe any changes in consumer behavior might have noticed, you know, I guess we could use maybe late February when the Ukraine conflict began or, or, you know, subsequent to that, just any, any behavioral changes you're noticing. And then my second question is on, on CAC, you know, now that we have a one quarter, and I know it's so early, but, you know, how is CAC?

Describe any changes in consumer behavior, you might've noticed.

Yes, we could use maybe late February when the Ukraine conflict began.

Subsequent to that just any any behavioral changes you're noticing and then my second question on cash now that we have.

One quarter I know, it's still early but how it's Kirk.

you know, trended relative to your, you know, to history, which I think was something in the $50 range or alternatively how the trended relative to your internal expectations.

Trended relative to your history, which I think was something in the $50 range or.

Alternatively.

The trended relative to your internal expectations.

Hey, Marvin you got you got you here, so I'll provide some context and maybe I'll hand, it over to mark to fill in the blanks on a detail. So overall if you remember just when it comes to consumer behavior, we have two sets.

Hey, Marvin, you got you got change here. So I'll provide some context and maybe I'll hand it over to Mark to fill in the blanks on the on the details. So, you know, overall, if you remember, just when it comes to consumer behavior, we have two sets of customers really that we serve within our retail segment. So, as you heard before, B2B, something that we're really pleased about, man, like the last quarter, you know, if you remember, we posted up plus 50% year over year.

<unk> really that we serve within our retail segment. So as you heard before BTB something that we're really pleased about man.

The last quarter. If you remember we posted up plus 50, 50% year over year gains now youre seeing that accelerate even more to plus 65% in this current quarter that we're reporting.

Now you're seeing that accelerate even more to plus 65% in this current quarter that we're reporting.

As Mark mentioned before that that behavior coming from not only increased basket size, but also increased repeat behavior. So they're spending more and they are coming back more.

And Thats the BW trend if you harken back to when we first went public that we said would be so important for us to capitalize on so at the pandemic happened <unk>, which was such an important part of our business largely went away and then now as we reopen.

The World Reopens, we're starting to see that built in tailwind that I think a lot of folks out there don't realize but the key part of our business.

I think a lot of folks out there don't realize that the key part of our business. On the B2C side, as Mark mentioned before, in a good way we're seeing folks behave as they did pre-pandemic in a great way. So we sell consumables, folks repeat quite a bit when you're buying these consumables and seeing that cohort behavior continue to trend in the right direction is something that gives us a great confidence for this year. What I also wanna say before I hand over the mic to Mark is that when you look at the individual KPIs,

On the B2C side, as Mark mentioned before, in a good way we're seeing folks behave as they did pre-pandemic in a great way. So we sell consumables, folks repeat quite a bit when you're buying these consumables, and seeing that cohort behavior continues to trend in the right direction is something that gives us a great confidence for this year.

On the <unk> side as Mark mentioned before in a good way we are seeing both behave as they did pre pandemic and a great way. So we sell consumables both repeat quite a bit when you are buying these consumables and seeing that cohort behavior continues to trend in the right direction, it's something that gives us a great confidence for this.

This year.

What I also want to say, before I hand over the mic to Mark, is that when you look at the

What I also want to say before I hand over the mic.

Mike Mark is that when you look at the individual kpis of these customers. So.

individual KPIs of these customers, so net revenue for active customer

Net revenue per active customer.

how much they're repeating, AOV, all these things, I believe, are trending in the right direction. And so I think you're going to start to see the output of that really gain theme as the quarters go by. So,

How much they're repeating.

<unk>.

All of these things.

I believe are trending in the right direction, and so I think youre going to start to see the output of that really gain theme as the quarters go by so.

As we had that injection of capital, we started deploying it, and I think you're starting to see some tailwind coming out of that.

As we had that injection of capital we started deploying it and I think youre starting to see some tailwind coming out of that.

Mark.

Yes, Marvin related to your question around Ukraine, I don't think we've seen anything specific within that data that would suggest there has been any major change as a result of that conflict. Obviously, we're being very mindful. There certainly our hearts go out to everyone who has been impacted by the complex itself.

Yeah, and Marvin, related to your question, you know, around Ukraine, I don't think we've seen anything specific within the data that that would suggest there's been any major changes as a result of that conflict. Obviously, you know, we're, we're being very mindful there and certainly our hearts go out to everyone who's been impacted by the conflict itself.

You know, when we look at, um, turning to your other question around sort of customer acquisition costs and what we're seeing there, I think, you know, as we sort of previously communicated.

We look at turning to your other question around sort of customer acquisition costs and what we're seeing there I think as we sort of previously communicated.

Early across the investment periods here in Q1 and Q2, we're really, really focused around this brand messaging and starting to build some of that awareness around the brand and investing much more heavily into marketing across those types of channels, which we always anticipated would basically yield medium to longer term gains across customer acquisition, conversion rates, et cetera. So in the near term, certainly we're seeing some variability in the CAC.

Early across the investment period here in Q1, and Q2 were really really focused around sort of its brand messaging and starting to build some of that awareness around the brand and investing much more heavily in marketing across those types of channels, which we always anticipated would basically yield medium to long.

Term gains across customer acquisition conversion rates et cetera. So in the near term certainly we're seeing some variability in the tax compared to maybe where we had been when we're only spending and investing behind performance channels, but our focus there is that over time that brand investment will help to support those bottle.

compared to maybe where we had been when we were only spending and invested behind performance channels.

But our focus there is that over time, that brand investment will help to support those battle funnel channels as we move forward. And that's when you're going to start to see tech sort of re-stabilize back to historical norms.

That funnel channels as we move forward and Thats when you start going to start to see tax sort of re stabilize back to historical norms as well as enable us to really scale marketing investment and a very efficient manner.

as well as enable us to really scale marketing investment in a very efficient manner in the future.

In the future.

Yeah, I apologize, maybe, maybe I missed, I probably didn't describe the question. Well, I guess I was using the Ukraine conflict as sort of a separation point between like spiking energy prices and maybe some product shortages. And I just, I think my question is more just sort of like, have you noticed any change in maybe the B to C segment and how consumers are sort of reacting to, to inflation and maybe even product shortages. So, so maybe that'll help clarify the question. I don't know if there was anything new for you to say.

Yes, I apologize, maybe maybe I missed it.

I, probably didnt describe the question I guess I was using the Clinton cleaning times like the solo separation point between like spiking energy prices and maybe some product shortages and I. Just I think that my question was more just sort of like have you noticed any change in maybe the beta seem segment in <unk>.

Tumors.

Felicia and maybe even product shortages. So maybe that'll help clarify that question I don't know if there's anything new for you to say loans.

Yeah, Marvin, so thank you for clarifying that. So, overall, I wouldn't say really any big changes because of that conflict or because of inflation that we can report as of yet. Of course, we have a very strong private brand and we believe that people will continue to block to that, especially as inflation picks up.

Yes, Marvin is try again, so thank you for clarifying that so overall I wouldn't say really any big changes because of that conflict or because of it.

Inflation that we can report as of yet of course, we have a very strong private brand and we believe that people will continue to block to that especially as inflation picks up but overall, if I could speak holistically about the business, especially for B to C. As inflation does pick up to a point, where now I think overall the world is seeing it.

But overall, if I could speak holistically about the business, especially for B2C, as inflation does pick up to a point where now I think overall the world is seeing it as pretty hot in terms of inflation historically, you're going to start to see folks really potentially shift the channels in which they're shopping at. And so potentially going to different discounters. And of course, for us, saving money by buying in bulk. So I think an inflationary environment, I think a high inflationary environment could be actually quite good for our B2C business.

Pretty hot in terms of inflation historically.

Youre going to start to see folks really potentially.

The channels in which Theyre shopping act and so potentially going to a different discounters and of course for us saving money by buying in bulk so I think and it pushed an inflationary environment I think a high inflationary environment could be actually quite good for our DTC business.

Okay, great. Thanks for, thanks for that additional commentary. Appreciate it, Shay and Mark.

Okay, great. Thanks for thanks for that additional commentary I appreciate it.

Thank you Mr Fong.

The next question is from the line of Tom Forte with DA Davidson. Please proceed.

The next question is from the line of Tom Forte with D. A Davidson. Please proceed.

Great. Thanks for taking my question. I have one question and one follow up. So you talked a little about inflation there. I think you have a tremendous private label product. Are you seeing consumers opt more for your private label? And generally speaking, how should we think about the margin opportunity as a greater percentage of sales are private label?

Great. Thanks for taking my question I have one question and one follow up.

So you talked a little about inflation there.

Thank you have a tremendous private label products are you seeing consumers opt more for your private label and generally speaking how should we think about the margin opportunity has a greater percentage of sales.

The label.

Okay.

Hey, Tom. Thanks so much. I'll take that one. So, you know, when we look at Priter brand penetration, largely on sort of a in on going in quarter over quarter basis, we've seen that relatively stable. You know, when we look at sort of 2021 compared to where we are today, I think some of the dynamic there is that we've actually started, you know, it's part of sort of some anti inflationary sort of campaigns. We've actually started to invest back in price.

Hey, Tom Thanks, so much I'll take that one.

When we look at private brand penetration largely.

An ongoing quarter over quarter basis, we see that relatively stable.

When we look at.

2021.

Hard to where we are today I think some of the dynamic there is that we've actually started it's part of sort of some anti inflationary sort of campaigns, we've actually started to invest back in price on.

On certain branded items as well. And so we're actually, you know, providing price cuts on certain items and you started to see some of that communication around our marketing strategy, which I think is helping support, you know, some of the growth trends we're seeing. But on the other side of that, you know, maybe.

Im certain branded items as well and so we're actually providing price cut sensor and items that you've started to see some of that communication around our marketing strategy, which I think is helping support.

Some of the growth trends, we're seeing but on the other side of that.

Maybe.

you know, causing some of the penetration rates we're seeing on the private brand to remain relatively stable compared to where they were in Q3 and Q4 of last year. When we think about the opportunity there, certainly, I think you hit the nut now on the head. You know, that private brand business about six point margin advantage over a branded product.

Causing some of it.

Penetration rates, we're seeing on the private brand to remain relatively stable compared to where they were in Q3 and Q4 of last year.

When we think about the opportunity there certainly I think you hit the nail on the head that private brand business about six point margin advantage over our branded products and we will continue to invest behind that on a go forward basis to try to improve penetration around that private brand in general and then just noted.

And, you know, we'll continue to invest behind that on a go forward basis to try to improve penetration around that private brand in general. And then, you know, just note, sort of piggybacking off what Chase said earlier, I think we're starting to see some of the trends around how private brands saving.

Piggybacking off with Chase that earlier I think we're starting to see some of the trends around how private brand savings is really going to impact the consumer behavior, especially during this inflationary period and so we should expect some nice tailwind over the course of the rest of the year, if it sort of inflation rates maintain where they are.

is really going to impact the consumer behavior, especially during this inflationary period. And so we should expect some nice tailwinds over the course of the rest of the year, if sort of inflation rates maintain where they are.

Great and then for my follow up question I have a longer term question on your fulfillment center build out.

Great. And then for my follow-up question, I have a longer term question on your fulfillment center build out. So where are you today at a high level? What are your plans for adding more fulfillment centers over the next couple of years? And then how could adding more fulfillment centers improve your shipping?

So where are you today.

At a high level what are your planned strategy more fulfillment centers over the next couple of years, and then how could adding more fulfillment centers.

Prove your.

Shifting.

from a cost standpoint by lowering the miles delivered to the consumer.

From a cost standpoint by lowering the miles delivered to the consumer.

Hey, Tom.

Hey, Tom, that's a wonderful question to share here again that we spend a lot of time thinking about, and I think you're going to start to see, especially in Q3 and Q4, the max delivery acquisitions begin to make more and more sense. And so remember, right now, max delivery is out of, you know, sub 10,000 square foot facility. So as we had our analysts say, so remember, our facilities are way larger than 10,000.

That's a that's a wonderful question, it's Jay here again that we spend a lot of time thinking about.

And I think youre going to start to see especially in Q3 and Q4, the Max delivery acquisition begin to make more and more sense.

And so remember right now Max deliveries out of sub 10000 square foot facility. So.

We had our analyst day, but remember our facilities, our way larger than 10000 square feet.

As we said before, as we announced the additional locations and open those locations later this year for max delivery, you're going to see them slightly larger or larger than where they are today, but smaller than where we traditionally have been so that you're going to start to see them as combined facilities.

As we said before as we announced the additional locations and open those locations later this year for Mac delivery youre going to see them slightly larger or larger than where they are today, but smaller than where we traditionally have been so that youre going to start to see them as combined facilities and so as we begin to adopt the country with those.

And so as we begin to dot the country with those smaller lightweight dark star facilities, we can actually cross dock inventory so that they can pick package ship out of those facilities, or we can cross dock actually actual packed items or packed packages so that the local couriers or max delivery can then deliver in their local location.

Smaller lightweight dark store facilities, we can actually cross dock inventory, so that they can pick pack and ship out of those facilities or we can cross dock actually actual pack items or pack packages. So that the local courier or Max delivery can then deliver in their local locations and as you alluded to.

And as you alluded to before, getting closer to the customer, you know, the mild travel is a large, large, large part of how much it costs or the cost structure of what it takes to shift to our end customer. So the closer we are to them, the more we save. So in addition to our Federal Express relationship, of course, building more fulfillment centers across the country will enable us to continue to lower our cost when it comes to transportation and thereby increasing gross market.

Before getting closer to the customer the miles traveled is a large large large part of how much it cost or the cost structure, what it takes to ship to our end customers. So the closer we are to them. The more we saved so additional in addition to our federal Express relationship of course building more fulfillment centers across the country.

<unk> will enable us to continue to lower our cost when it comes to transportation and thereby increasing gross margin.

Great. If I may I have one follow up then to what you just pointed out say so when I think about your larger fulfillment centers. One thing that impresses me is the high level of automation, how should I think about the use of automation that is smaller fulfillment centers.

Great. If I may, I have one follow-up then to what you just pointed out, Che. So when I think about your larger fulfillment centers, one thing that impresses me is the high level of automation. How should I think about the use of automation at these smaller fulfillment centers?

Yes.

That's a that's a very good point. So when you think about all the pieces beginning to fit together.

Yes.

That's a very astute point, so when you think about.

All of the pieces beginning to fit together.

Hopefully, it also answers why we build our own custom robotics. And so the fulfillment center that we hosted our analyst day at last year, you'll see that was huge conveyors, miles and miles of conveyors, multi-story mezzanine. You don't see that in a typical dark store environment. And so if you remember, we then, at the end of the tour, showed you kind of the single-floor custom-built robotics that we had, which would fit into a much smaller location.

Hopefully it also answers why we build our own custom robotics and so the fulfillment center that we hosted our analyst day at last year, you'll see that was huge conveyors miles and miles of conveyors multi storey mezzanine you don't see that in a typical dark store environment.

And so if you remember we then at the end of the tour showed you kind of the single floor custom built robotics that we had which would fit into a much smaller location.

And so, of course, those robotics wouldn't fit in say 2,000, 3,000 square feet, but once you get to 10,000, 15,000, 20,000 square feet, that's when those robotics can really begin to shine.

And so of course, those robotics wouldn't fit in say two to 3000 square feet, but once you get the 10000 15000 20000 square feet, that's when those robotics and really begin to shine.

Great. Thank you. Thank you Mark.

Thank you Mr <unk>.

There are no additional questions waiting at this time, so I will turn the call over to Jay Huang for closing remarks.

There are no additional questions waiting at this time, so I will turn the call over to Jay Lown for closing remarks.

Well, thanks, everybody for joining our call today. So as you can tell we're very excited about what we've created so far what we felt about the quarter and we felt that there was a massive opportunity not only in the quarter that we capitalize on but also in 2022, so with that thanks, so much for joining our call with Phoenix.

Well, thanks everybody for joining our call today. So as you can tell, we're very excited about what we have created so far, what we felt about the quarter, and we felt that there's a massive opportunity, not only in the quarter that we capitalized on, but also in 2022. So with that, thanks so much for joining our call. We'll see you next time.

John .

Yeah.

That concludes today's conference call. Thank you for your participation. You may now disconnect your line.

That concludes today's conference call. Thank you for your participation you may now disconnect your lines.

Thank you for watching!

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