Q3 2022 Riskified Ltd Earnings Call
Yeah.
Good day and thank you for standing by welcome to the diversified third quarter 2022 earnings call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During this session you will need to press star one one.
Your telephone.
Be advised that today's conference is being recorded.
I would now like to hand, the conference over to your speaker today chat Mendell head of Investor Relations. Please go ahead.
Good morning, and thank you for joining us today my.
My name is chat mendell rectified as head of Investor Relations. We are hosting today's call to discuss risk about results for the third quarter of 2022.
Participating on today's call are <unk> risk of hides a co founder and CEO and <unk> risk effects Chief Financial Officer.
We released our results for the third quarter earlier today, our earnings materials, including a replay of today's webcast are available on our Investor Relations website at IR that risk of five dot com.
Certain statements made on the call today will be forward looking statements related to our operating performance financial goals and business outlook, which reflect management's best judgment based on currently available information and are not guarantees of future performance.
Please note that these forward looking statements reflect our opinions as of the date of this call and except as required by applicable law. We undertake no obligation to revise this information as a result of new developments that may occur after the time of this call.
These forward looking statements involve risks uncertainties and other factors some of which are beyond our control that could cause actual results to differ materially from our expectations you should not put undue reliance on any forward looking statements. Please.
Please refer to our periodic and other SEC filings for more information on the specific factors that could cause actual results to differ materially from our expectations. Additionally.
Additionally, non-GAAP financial measures will be discussed on the call reconciliations to the most direct comparable GAAP financial measures are available in our earnings release issued and furnished with the SEC on form 6K today.
And our prior filings with the SEC and in the appendix of our Investor Relations presentation, all of which are posted on our Investor Relations website I will now turn the call over to readout.
Thanks, Jeff and Hello, everyone.
Building off the momentum from a strong first half of the year, we saw an acceleration in our growth during the third quarter revenues were $63 million, representing 20% year over year growth, which is more than double our second quarter year over year growth.
On a constant currency basis, our revenues were $65 million, representing 24% year over year growth.
We achieved our strongest quarter of the year through increased upsell activity, new logo wins and a very busy quarter for tickets in the travel vertical.
Positive momentum more than offset declines in the organic growth some of our existing merchant, which we primarily attribute to the tougher macroeconomic environment.
Overall, I am pleased that our total growth outpace the growth in the broader economy.
Our achievements in the first nine months of 2022, well beyond our financial performance, we have strengthened our leadership team and I am more confident than ever in our current go to market position.
Okay.
We have focused on thoughtfully expanding our global footprint further penetrating the emerging category broadening our partnership channel and developing new products.
We believe that this strategy will enhance our ability to solve the growing number of high value use cases for our merchants.
This will help and enabling risk advisory capturing increased share the broader e-commerce landscape, which would allow us to grow sustainably over the long term.
This differentiated position combined with the powerful value proposition that we believe we offer to our merchant is leading to strong traction for our sales.
Proof of this success is evidenced in the quality of our new logo wins and strengthen recent upsell.
Great example of a recent new logo win and as we've highlighted in our earnings release was the on boarding of one of the world's largest secondary ticket marketplaces for live sports concerts theater and event. This merchant processes billions of dollars worth of transactions annually. We earned this big win by demonstrating superior performance.
In a competitive process and we're proud to have entered into a contract to review nearly all of this merchant E. Commerce volume, we believe tickets and travel as an industry in which we are rapidly extending our competitive position.
I want to highlight that the breadth of our new logos goes beyond tickets and travel.
For example, some of our top new logos signed during the quarter were in fashion retail and then our money transfer category as we continued to expand our portfolio of merchant, we are becoming more diversified than ever before.
We also continued to execute on our successful land and expand strategy. We believe this strategy drives GMB and long term gross profit gaining customer engagement growth and mature we saw strengthen ourselves across various merchant sizes with particular momentum from our merchants with more than $3 billion in online sales volume.
Per year.
We also had success from both merchants in our more mature cohorts and from newer enrollments, we are continuously deepening our relationships and increasing the value that we offer our merchants as they submit additional order population through our platform.
In addition to the momentum in our sales effort during the third quarter, our gross profit growth of 35% exceeded our revenue growth, reflecting the benefits of the ongoing investment in our technology and the strength and leverage in our business.
As we discussed in depth on the last earnings call. Our key initiatives for the second half of 2022 and beyond has been to prioritize profitable growth.
Through thoughtfully, reducing our expenses in recognizing additional operating leverage we believe that we are accelerating our path to profitability.
All while keeping our long term growth outlook intact. This golar remains a top priority for the company and I am very pleased with the progress that we have made in executing on this important initiative.
During the quarter, we lowered our expense base and combined with an acceleration in our revenue growth, we saw 33% improvement in our adjusted EBITDA results sequentially, which arguable expand onshore.
As we approach year end I am proud that our diversified and global company has continued to grow and strengthen despite the challenging economic environment that we're operating in our dialogue with merchants is high our pipeline is healthy and we believe that our go to market positioning is the best it has ever been by leveraging our superior.
Your data and strong technology, we believe that this will allow us to continue to do what we do best helping enable the best outcomes and operational improvements for our merchants, which we expect will in turn help drive value for our shareholders.
Before I turn it to <unk>, who.
We will cover the financial results in more detail I want to thank all <unk> employees for their relentless dedication and accomplishing the fantastic quarter I look forward to ending the year strong as we aim to execute on the goals of the company together.
Thank you.
And everyone for joining today's call.
Our G&A for the third quarter was 25 billion, reflecting a 21% increase year over year.
We achieved third quarter revenue of $63 million up 20% year over year, and 24% on a constant currency basis.
The growth in Gms and revenue during the quarter was primarily driven by the continued expansion of our platform across new merchants NFL and revenue growth across all geographies.
During the third quarter, we saw ongoing growth across our money transfer category and we continue to benefit from sustained growth in fashion and luxury goods.
As expected tickets and travel continued to rebound to be the most meaningful area of growth during the quarter.
We believe that there are additional <unk> opportunities for us in this category from new merchants and upsell based on our current pipeline of activity.
Is it all mentioned our organic growth remains below historical trends.
Which we primarily attribute to continuation of the impact of SBC to.
Combined with a more challenged macroeconomic environment compared to this time last year, which is driving software ecommerce activity.
We remain optimistic that in time, the broader e-commerce landscape will improve from current levels, which we believe should positively impact our organic growth.
From a geographic standpoint, we saw growth across all our regions, which solidifies the ROI that we're seeing from our level of investment.
The United States continues to grow and we once again saw strength in EMEA.
Consistent with last quarter, the strengthening Neil was achieved through the addition of key new merchants as well as continued success in tickets and travel.
Our non-GAAP gross profit margin for the third quarter of 2022, 52%.
Please go ahead with the second quarter of 2022 and up from 47% in third quarter of the prior year.
We've mentioned in the past the gross profit margin is best analyzed on an annual basis as individual quarters can fluctuate mainly due to adjustments and improvements in our decisioning model changes in the industry mix of our revenues.
Seasonality factors, the ramping of new merchant the variety risk profile of transactions approved along with other business priority.
The year over year increase in the third quarter of 2022 was driven primarily by overall positive outcome related to some of the factors listed above.
We have operated the company in a profitable manner in prior periods and we're focusing on the levers to pull and the process is to prioritize in order to return there.
During the second quarter of 2022, we initiated a plan to efficiently and thoughtfully reduced our operating expenses.
We continue to successfully execute on this plan and further reduce our expense base in the third quarter.
Total non-GAAP operating expenses were 42 million a decline of 5% from the second quarter.
We saw sequential improvements across all areas of our expense base and our non-GAAP operating expenses as a percentage of revenue declined to 67% in the third quarter of 2022 from 74% in the second quarter.
We expect expenses as a percentage of revenue to further decline in the fourth quarter, reflecting leverage in the business model.
For modeling purposes, we anticipate a modest step up in expenses in the fourth quarter similar to the cadence we saw in the prior year.
This is mainly a function of the timing of sales commissions earned and some seasonality.
We will continue to diligently manage our hiring plans and expense base into 2023 to.
To help drive future adjusted EBITDA improvement.
Adjusted EBITDA loss for the third quarter was negative 9 million, a more than 30% improvement both sequentially and year over year.
In addition, we continue to maintain a healthy cash flow model with free cash flow of negative $4 million for the third quarter.
This represents a 75% improvement year over year for.
For the first nine months of the year, our free cash outflows have been approximately $27 million and we feel great about our ability to manage our cash outflow, which meaningfully slowed during the quarter.
Moving to the balance sheet, we maintain a very strong liquidity position, which we anticipate to be more than sufficient to support the investments we're contemplating as we aim to move towards profitability.
We entered the third quarter with approximately $484 million of cash and deposits on the balance sheet and we carry zero debt.
And now turning to our updated guidance outlook for the full year of 2022.
The updated revenue guidance assumes currency rates against the USD remained stable at the current level and that there is not a further deterioration of macroeconomic conditions.
In addition, we will continue to monitor the performance of our merchant business, the adoption and the broader ecommerce landscape.
For the full year 2022, we're revising upward our guidance ranges.
In the face of a separate growth landscape, we have now raised our guidance on two separate occasions.
It is trading the resilience of the business and strength in our new merchants.
We now anticipate revenue to be between $257 million and $261 million up from our previous guidance of 255 million to $258 million.
As previously communicated we continue to expect our fourth quarter revenue to reflect the softness it's a broader e-commerce and retail uncertainty that may persist during the holiday shopping season.
As a result, we anticipate our year over year growth in the fourth quarter to be lower than the third quarter, which is reflected in our updated full year guidance.
The most meaningful upward improvements our guidance are a direct result of the opex savings that we're realizing.
These savings have resulted in us improving our full year adjusted EBITDA guidance by 18% from our August guidance.
We currently expect to between negative $44 million and negative 47 million, an improvement from negative 54 million and negative $57 million.
Our new range represents a 33% improvement from the midpoint of our initial guidance given in February of this year.
We have had initial success in controlling our expense base across the company.
While sharpening our pencils to find additional areas to optimize our cost structure.
Overall, we're very pleased with our results and remain excited about our continued prospects for long term growth.
We look forward to continuing to report our progress to you in the coming quarters.
Operator, we're ready to take the first question. Please.
Thank you.
As a reminder to ask a question you will need to press star one one on your telephone.
Please stand by while we compile the Q&A roster.
Our first question comes from Tim <unk> with Credit Suisse. Your line is now open.
Great. Thank you good morning, I. Appreciate you taking the question so definitely impressive in terms of the cost savings and you mentioned the improvement in the profitability Im sure thats much appreciated by many investors in terms of the Opex savings and actually in context of longer term. So your outlook for EBITDA margins longer term or roughly.
20% I realize we're far away from that today, but in terms of the timing of getting there when should investors be thinking about plugging that 20% into their model. How many years away roughly would you say that that might be and then I have a quick follow up on the travel vertical if you don't mind.
Sure.
Why do we think about the.
Cost of profitability.
They're reaching the 20% margin I would say, obviously very happy with the <unk>.
The team has done this quarter or previous quarter lowering our expense base on the next quarter, we anticipate expenses as a percent of revenue to kind of go down further and really when we think about how much progress we will be showing in 2023, we need to take a step back and just talk about revenue right.
So this quarter great go to market performance, 20% revenue growth.
On the faces some headwinds of 4% FX impact.
Mid single digit regulatory CSP, two impact and organic e-commerce growth was actually slightly negative all right thinking.
And thinking about how these things will play out in 2020 as.
As we've previously shared PSD two we anticipate would be non material, we think that the FX impact will kind of.
Disappear in the back half of next year and the one area that I want to be more thoughtful in and kind of do a bit more homework and sharpen our pencil is how we think the organic will behave next year right. So.
Slightly over 30% of our business is ticket travel and events.
The remainder is pretty diversified across geographies and industries. So we just need to spend time building a bottoms up model to understand how that will behave next year before really understanding our path to profitability, but without getting into guidance just to give you a general framework if organic we definitely see period.
Profitability in the back half of next year, and then I think you can extrapolate further into that kind of longer term, 20% target.
Okay.
And then just to make sure I heard that right periods of profitability potentially in the back half of next year, meaning on an EBITDA basis potentially turning slightly positive as early as the back of next year.
Correct.
Okay. Thank you for that context I'm sure that's appreciated and my brief follow up is the travel and tickets vertical.
But we have in the past you've mentioned that growth in that.
Vertical year over year, I know you mentioned, many new logo additions and its clearly an area of strength for the company, but were you able to provide a pinpoint estimate or sorry, the actual on what the growth was this past quarter.
Yes. Thank you for the questions I'll I'll take this one.
Tickets on travel grew meaningfully in Q3.
It was both driven by existing merchants, who are now at <unk>.
They are above pre pandemic levels, then we're very happy with that growth, but also adding new merchants and upselling existing one so I would say that overall it was probably the highest growth that we've seen in terms of all industry.
And.
And most importantly, a duvernay because we still have an upside in this category.
White space opportunity.
Some of the new merchants that we're adding but also just looking into the pipeline of new logos.
Perfect. Thank you so much for taking both of those I really appreciate it.
Thank you.
Our next question comes from the line of Owen Callahan with Barclays. Your line is now open.
Hi, guys.
On for Ramsey I. Appreciate you, taking our question I wanted to expand a little bit on that merchant mix and pipeline generation I wanted to get an understanding of how important these new logos are when factoring in the slowing of current merchant volumes and additionally to that I wanted to get a sense of the mix.
These new merchants or are they coming from new geographies or new verticals.
Any color there would be super helpful. Thanks.
Hey, Alan Thanks for the questions. So, let's unpack the revenue growth again to understand the dynamics between new clients and upsell to existing clients relative to the organic right. So that 20% growth, which still have the 4% FX impact on that mid single digit regulatory.
We impact.
Really that was all the growth came from new and existing clients because the organic base was just slightly negative.
So really great go to market performance team has been performing extremely well and there is a great demand environment.
Because of the guaranteed cost saving product was operating while kind of still generating higher incremental sales for our margin. So we're very very pleased with that.
Overall, its very diversified its coming from a combination of across geographies across industries, a great mix of net new upsell to existing.
Yes.
Got it that's super helpful. Thank you.
Thank you.
Our next question comes from the line of Terry Tillman with Truest. Your line is now open.
Yes, thanks for taking my questions.
Solid performance here.
Hi, there. The first question is just on enhancing go to market motions and just optimizing our go to market. You know you had an important leadership addition earlier in the year or at least a couple of quarters ago.
Where do you see more of the low hanging fruit or ongoing kind of.
Greater impact is it new logo success or just doing more cross selling and up selling with existing customers does one area seem much more pronounced or again low hanging fruit is probably oversimplifying it but just trying to get a sense on where you see some of the enhanced go to market benefits.
Whether it's new or existing and then I had a follow up.
Hey, Terry Thanks for the question.
Definitely Ralph and the entire go to market organization has had a great quarter.
And it really been doing some great process improvement that we've been seeing the results, but it's not just been right. It really starts with the product and what we've consistently been seeing.
And these type of enterprise motions that were able to show through pilot that's more the most accurate solution on the market because of that we've been able to win these types of competitive cycle and in fact that multibillion dollar TPB ticketing.
Ticketing merchant that we mentioned in our release with the competitive cycle that we won in this way.
That's helping us accelerate the growth right. So you layer that in together with the fact that we now have a more global go to market team together with the fact that we're able to sell additional new use cases for our merchants by policy protect like dispute resolved. So they are all working in tandem.
We are just being consistent strength across side, both on the new logos and upsell for example, again going back to this multibillion dollar ticketing merchant that was a new win a few months ago that we were able to upsell in a very short time right. So it's really showing success on both fronts.
That's great to hear and I guess augie.
There's been a couple of questions on the accelerated path to profitability and both of you all have provided some interesting and positive color.
Yes. The reality is we can't just look at <unk> expense base and somehow run rate that or reduce that a little bit because theres. Some seasonal expenses can you remind us what kind of uptick there is seasonality on the expense side of <unk> and just anything directionally around the three opex items in 2003 should they continue to.
The lower as a percentage of revenue just any more you could help us on how to think about run rate of expenses. Thank you.
Yes of course, there and thank you for the question. So for modeling purposes, we do anticipate a modest step up in expenses in the fourth quarter and Thats very similar to the cadence from last year.
And these are just a regular seasonal kind of step up it's really a function of normal seasonality I'll give you an example.
More incremental travel or some of the commission related payments that are usually done in the quarter.
So that's kind of like the ballpark and I think that overall this position Q4, the way to think about to keep our expenses positions us well.
The run rate for next year and kind of like on a really much lower base. If I think of like where we started back in February . Unlike the improvements that we've done now support us in a row and the continuous execution on that front.
Thank you.
Our next question comes from the line of Robert Napoli with William Blair. Your line is now open.
Thank you and good morning.
Good that various ito and good to hear about.
Outlook for next year and working towards that profitability.
What is your view in order for online sales growth for the industry.
You said that you thought it was slightly negative.
In the third quarter.
Any view on trends in the fourth quarter I guess, what do you think online sales growth is going to be in order to get to that profitability, where it needs to be in 2023 and your thoughts on long term.
So let me give you some kind of nuance around Q4 and seasonality I think that.
The online online industry overall.
Great, Yes, no history.
Sure. So if I think about Q4, we do expect a slightly different mix in terms of the industry compared to Q3 Q3 traditionally I think it's in travel season Q4 to get to the travel we continue to expect to have a strong performance, but traditionally the.
Kind of like the general retailers are the ones that are expected to have a stronger.
<unk> of the overall portfolio so so far.
I think that overall.
Surprise to anyone but just a rating through industry analyst reports the online sales at holiday season are projected to see their smart growth and some years, while still growing.
So overall side, our spending environment for the general retail ecommerce.
Like what we are.
Protecting.
Okay and then.
To get where do you expect to see the operating leverage in.
You had good gross margins this quarter.
The 52%.
Gross profit margin I know looking at it on an annual basis, but is that the right way to think about gross margins and then where do you get the operating leverage where do you expect to get expect to get most of it on the G&A line as.
And any commentary on where you expect to see.
Net operating leverage.
Yeah, we think that the current level is the right zone.
Gross margin plus minus.
As I just kind of.
Fourth quarter is a viable for a variety of factors.
But we feel that we're on track to meet or slightly exceed our annual target.
And.
And as always I'll go look at the or target and we'll see how it kind of really look at our models to be the most efficient sufficient as possible.
And generate the best outcome for our merchants and for our business.
And as to operating leverage.
Yes and to your second question about operating leverage I'm very happy that we've continued to reduce our expenses as a percentage of revenue and I expect that the continuing into Q4 as well.
Thank you.
Thank you.
Our next question comes from the line of Tinson Wang with Jpmorgan. Your line is now open.
Yes.
Alright. Thank you great results here I wanted to ask just wanted to make sure I understood just to <unk>.
Fourth quarter thinking here relative to what you saw in the third quarter any change in view from from 90 days ago with respect to revenue and gross margin.
Wanted to make sure I understood them.
Yes.
Just to give you more clarity or we are raising our annual guidance on the topline and I'm very happy about the overall performance, we do expect Q4 to be a little bit more.
Kind of softer and that's reflected in our guidance and the range that we have right now so.
The range really represents the best estimate of the annual result, but.
It's no secret to anyone that the environment is highly viable and thats reflected in the guide on the gross margin just to reiterate we do expect.
To meet or slightly beat the annual goal.
And I think that kind of like the way we're thinking about.
Both Q4 and.
2022 in general Okay, No that's perfect and read very reasonable. So just on my follow up just on the charge back to billings performance.
And.
And the gross margin in general to Bob's question is it a function of better outcomes driven by your tech as <unk> had another.
Quarter to season that or are there any changes in risk decisioning on your part or from your clients part.
Thanks, Adam.
We are very happy with our modeling performance and we continue to see cohort improvements.
We've been able to see especially pronounced improvement in some of our tickets and travel merchants driving better performance for this quarter. So overall definitely very pleased with that.
Great.
Thank you.
Thank you.
Our next question comes from the line of Brent <unk> with Piper Sandler Your line is now open.
Thank you good morning, I wanted to circle back and talk a little bit about some of the new merchant activity pipeline activity.
You called out adding renewed activity in travel kind of customer.
Clicking on a large degree a majority of their traffic are you seeing a mix shift where customers and new merchants that you're engaging with are looking to outsource to a 100% of the network traffic and thats, increasing part of the pipeline just love to better understand.
The Lance, which historically have been small lands and expands but it sounds like the lands now are starting to creep into the larger land environment, taking over a bigger portion of the network. So love to just drill down into that trend if thats something youre seeing.
Sure. So I would say the historical trend has usually been starting on a segment of our merchants volume and then expanding over time and I think what we've seen is that we have more merchants submitting more substantial amounts of volume day, one, but also an acceleration of the <unk>.
Timeframe between initial submission in a larger engagement and to your point. This merchant that we highlighted this multibillion dollar ticketing merchant where we do.
Most of their volume right now that happened in.
And a very quick time span much quicker than we have had historically so we do feel that's probably a combination of just some of the.
Proof points in the industry that we have getting people more comfortable on the overall demand environment right now in the guaranteed profit.
Helpful Color and then as we think about.
Heading into a recession in the U S next year or are there meaningful cost savings by by outsourcing.
Harvest typically your platform is the ROI.
Narrative resonating with customers just trying to think through as we go through a more challenging environment next year could that play to your advantage or is it.
It can be challenging just to close new deals and lengthening sales cycles, just trying to think through those factors heading into next year.
No that's a great point and obviously, we feel great about the demand environment right now because of exactly what you mentioned right. So when merchants are looking to optimize their cost base. We're one of the few tools that guarantees cost savings, while driving incremental revenue at the <unk>.
I'm, Scott, so, it's definitely becoming a bit we see it becoming a bigger focus for merchants globally and then we think we're incredibly well positioned to capitalize on that and I think thats driving some strength that we see this quarter and the overall pipeline and kind of got better demand environment for us.
Okay. Great. Thank you then last question here for Augie SaaS burn is more of a little under $4 million in the quarter.
Is that the right kind of cadence, we should think about on a quarterly burn rate into next year do you think that can narrow further into next year on a quarterly basis, just loves any sort of directional color on cash burn next year would be helpful. Thanks.
So I'm very happy with the cash the cash burn.
The free cash flows as Michel this quarter.
There is obviously some variety between quarter to quarter and driven by simultaneous and expenses, but on an annual basis helps thing that the adjusted EBITDA and free cash flow or are kind of close aligned.
And if I think about next year, well positioned place our expense base as I kind of mentioned Q4 is a good approximation on the run rate for next year. So obviously, there might be some kind of spread which is an already next year as well Q3 to Q4 may be showing kind of a similar step up but overall kind of flex.
<unk> base were very good conditions start.
To continue to show leverage for next year as well.
Great. Thank you.
Thank you.
As a reminder to ask a question at this time, Please press star one one oriented tongue telephone.
Our next question comes from the line of Josh Beck with Keybanc. Your line is now open.
Thank you for taking the question team.
You discussed the tickets and travel vertical I'm curious, maybe with respect to some of the other more meaningful verticals fashion luxury electronic so if there was anything that really stood out.
With respect maybe trends quarter to date.
How you are thinking about the prospects there.
As we enter 2003.
Sure so.
I think we've just we're continuing to see good growth in the areas, where we're strong right. So when you think about fashion, whether it's luxury or kind of general retail we continue to see strong growth there because of net New addition, and the upsells.
Some of the other more emerging categories, we continue to both the growth and build a healthy pipeline and I think we called out our remittance business, there, which we have high hopes for the future but are still seeing good results right now.
Again, the global diversification continues to be a great story for us as we ramped up the sales team. There. So I think those are maybe some of the things to highlight.
Okay.
Thats helpful.
A little bit.
<unk>.
In some ways a tricky question, but you talked about the ecommerce environment. This quarter I think that was a global number that you gave.
Being negative.
A lot of at least the U S forecast that kind of low single digit growth for Q4, I think one of the major question is moving forward do we get back to that that cadence of mid teens ecommerce growth and 60.
60, 70, 80 basis points of incremental e-commerce penetration every year and it's really tough.
To answer that.
At this juncture, but maybe just help us understand.
How are you.
Thinking about the future growth prospects for the e-commerce market overall.
What are some of the.
Kind of Biomarkers or data points that you'll be assessing to kind of refine that forecast moving forward.
Well I think the answer is yes, I think that E. Commerce will continue to grow in the years ahead.
I'm very optimistic about that and I say vast majority people analysts everyone involved in buying would agree with I think the question is.
When will that return is that.
How many quarters does it take for it to fully return into the harder question.
I don't have a good sense of right now we.
We want to be smarter about that before the 'twenty three guys and women return visit return at 10 15, Ed I think those are kind of more than nuanced questions, but im obviously very optimistic that we will see much better organic growth in.
In the quarters ahead than we did in this quarter.
Industry.
Very helpful. Thank you.
Okay.
Thank you and I'm currently showing no further questions at this time I would like to turn the call back over to <unk> for closing remarks.
Thank you every much. Thank you very much everyone and we really enjoy this teleconference and we look forward to updating you in the quarters ahead.
This concludes today's conference call. Thank you for your participation you may now disconnect.
Yes.
The conference will begin shortly to raise your hand during Q&A you can dial one one.
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