Q2 2023 Digital Turbine Inc Earnings Call

Good afternoon, and welcome to the digital turbine fiscal second.

Quarter Financial result conference call.

All participants will be in listen only mode.

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Please note the conference.

My single Starkey powered by <unk>.

After todays presentation, there will be.

An opportunity to ask questions.

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Please note this event is being recorded.

Now I'd like to turn the conference over to Brian Bartholomew.

Senior Vice President capital markets. Please go ahead.

Thanks Debbie.

Good afternoon, and welcome to the digital turbine fiscal year 2023 second quarter earnings Conference call.

Joining me on the call today to discuss our results are CEO , Bill stone and CFO Eric garrison.

Before we get started I'd like to take this opportunity to remind you that our remarks today will include forward looking statements.

These forward looking statements are based on our current assumptions expectations and beliefs, including projected operating metrics future products and services anticipated market demand and other forward looking topics.

We believe that our assumptions are reasonable.

They are not guarantees of future performance and some will inevitably prove to be incorrect.

Except as required by law, we undertake no obligation to update any forward looking statements.

For a discussion of the risk factors that could cause our actual results to differ materially from those contemplated by our forward looking statements. Please refer to the documents we file with the <unk>.

Securities and Exchange Commission.

Also during this call we will discuss certain non-GAAP measures of our performance non-GAAP measures are not substitutes for GAAP measures. Please refer to today's press release for important information about the limitations of using non-GAAP measures as well as reconciliations of these non-GAAP financial results to the most comparable GAAP measures.

Now I will turn the call over to our Chief Executive Officer, Mr. Bill Stone.

Thanks, Brian and thank you all for joining our call Tonight.

I know the vast majority of investors are currently focused on the macroeconomic environment and what it means for our business versus the micro operational details.

And while I'm going to cover both of my prepared remarks, I'd like to begin by talking about the macro environment and what it means to us before diving into our results for the second quarter.

The macro environment, we've experienced over the last two and a half years. He has been the most dynamic I've seen in my 30 year career, it's required companies to operate lean while being nimble flexible and open to change.

I want to focus my commentary on the current macro operating environment and what we are seeing regarding digital AD spending devices, and operator and OEM focus areas.

First on digital AD spending at the headline level and as many others have already reported it has slowed.

However, we believe that this is both temporary and also much more nuanced and the details as many are painting, all digital AD spending dynamics with the same brush.

We believe this trend is temporary for a very simple reason since the beginning of the first AD dollar spends hundreds of years ago, continuing to today and ultimately tomorrow AD dollars have always followed where eyeballs are and today. Our eyeballs are on digital devices, and we don't see that changing in fact, we see that growing.

While there are some modest deceleration in the short term as advertisers figure out how to best optimize their spend and an inflationary and slowing macro economic environment. The dollars are there and will be there over the mid and long term.

Also we see a lot of nuance in the AD dollar spent.

For example platforms that have been heavily reliant upon apples historical idea FA identifiers and AD tech tactics like views through attribution has been disproportionately negatively impacted.

Also platforms to have a difficult time working with advertisers on the return on AD spend or ROE ads metrics are also having a difficult time.

We are also seeing a modest slowdown in U S device volumes as consumers decide not to invest many hundreds of incremental dollars on a new device and some supply chain constraints exacerbate these trends in some markets.

For example, here in the U S devices were marginally up sequentially, but declined by more than $1 million from a year ago.

And finally, it's been well documented from many global operators and Oems on their commentary on how they are trying to grow revenue in these type of macro environments.

This is a tailwind for our business as they look for new revenue streams from companies like digital turbine and I'll provide some specific examples of our success later in my remarks.

The takeaway for investors is that we view the situation as temporary in nature. The macro conditions are more difficult compared to prior years, but not insurmountable or falling off a cliff.

Unlike the macro situation that is currently more supply versus demand driven this situation in our industry is more demand versus supply driven in the short term.

Oems operators and App publishers are looking for companies like digital turbine that can provide them with more dollars while demand sources are being more cautious and deliberate in their spend the dollars and opportunities are still there, albeit more work and effort is required to capture them compared to prior years.

Turning to our second quarter results, we had $175 million of revenues $48 million of EBITDA and 34 cents of non-GAAP earnings per share.

In addition, we reported record gross margins of 52% and record EBITDA margins of 28%.

This was our sixth consecutive quarter of EBITDA margin growth as we are focused on margin accretive opportunities and as Barrett will discuss in his comments, we are guiding today to make it our seventh consecutive quarter for this upcoming December quarter.

And over those prior six quarters, we have delivered nearly three times the EBITDA that we did in the preceding six years combined.

non-GAAP gross profit margins improved sequentially from 50% to 52% compared to a reported margin of 48% in the second quarter of last year.

Many companies struggle to increased margins in this current inflationary environment and the ability for us to continue to show margin improvement, it's something we're proud of.

Okay.

And given the macroeconomic situation focus is key to that end, we are reorienting, our head count towards future versus legacy products, and specifically or in migrating portions of our legacy performance and reseller AD tech businesses towards more focus on growing things like the brand business and proving performance on leveraging single tap on.

<unk> demand side platform or DSP.

This is having a short term headwind on pro forma overall top line performance, but the changes should continue to help both our margin profile and sharpen our focus by doing fewer things better.

Four on device business. The drivers of those results were driven by more devices more products and more media relationships and.

And in particular, we added nearly 75 million devices in the June quarter.

This compares to 68 million devices in the June quarter last year.

This growth was driven internationally as U S device sales were down about $1 million year over year.

Oh 1 million devices year over year I was pleased with our continued improvement in revenue per device or are P. D.

In the U S. Our RPT of over $5 per device was up approximately 15% year over year.

We have our PD work to do internationally as we did not seen the same year over year growth as the mix of devices was indexed higher in developing versus developed markets or rpt's tend to skew a bit lower.

Here in the U S. I'm pleased that we also extended our contract with Verizon for another four years as we continue to add new revenue streams and products with them.

We also made progress on our single tap licensing product.

We are on track to the update we provided at the last earnings call, but in particular I want to call out some higher profile license relationships with Google a tier one gaming publisher and also a very large e-commerce provider with a large growing advertising business.

Google will be selling our single tap licensing product and its Google cloud marketplace.

This is yet another benefit of the strategic partnership we announced with Google and our joint press release last year.

We also anticipate launching with the other two higher profile partners. During this current quarter.

Bigger picture for single tap licensing the product market fit is very strong and we're all excited about the prospects for single tap licensing, but I do want to remind investors that it will take time to get from executed agreements to material revenue generation.

Similar to the early days of our dynamic install business, where we launched with one mobile operator, and with only a slot or too and then ramped and then added another and so on and layered on nice sequential growth as we expanded the breadth and depth of our carriers and Oems.

I expect a similar trend to emerge with our single tap licensing business.

We also have some headwinds in tailwind in our content media business.

We discussed on our last earnings call, we've been focused on improving the overall quality of our product for advertisers. While also prioritizing growth in our postpaid content media business activities as we believe that longer term growth is going to come from the postpaid market that has approximately 300 million subscribers here in the U S compared to approximately $75 million.

For prepay.

Yeah.

Meanwhile, our strategic shift to prioritizing growth from the postpaid content media business has resulted in short term headwinds on prepaid daily active users or other odd device businesses would've experienced modest growth year over year.

We have launched our postpaid Verizon content need every relationship and are now on 50 different device models.

And as we ramp with Verizon expand with AT&T and focus less on this prepay contract revenue product, we expect our content media business to resume growth in 2023.

On the App growth platform or <unk> business.

Our year over year revenue growth was 6% our gross profit growth was double that driven by one or one DT synergies and our focus on higher margin products.

The slowing in the macro digital AD spending of declining E. C. Pms is being offset with higher volume of impressions as we continue to add additional supply in the market.

From a regional perspective, we continue to maintain a diversified global footprint.

And in the current quarter, we saw impressions grow year over year across all of our major regions with Asia Pacific showing particular strength.

Looking at AD placement types. We are also we have also maintained a balanced portfolio weighted between banner interstitial and video.

Banners have seen accelerated growth this past year with the continued expansion of the digital turbine exchange and DSP.

Video continues its growth trajectory and remains the placement format. We believe has the most future upside.

We have work to do on the <unk> on our performance and DSP business as that was below our internal expectations, but I was pleased to see sequential growth in our brand business is that as a strategic focus area for us and was a key driver of our add colony acquisition.

We have also made some strategic hires in our brand business over the past 60 days. So I'm optimistic we will continue to see momentum here.

I was also pleased to see growth of double digits year over year, and our Apple iOS business as we continue to prove improve our AI and machine learning and other larger players now have to compete on more of a level playing field with us now that things like do through attribution used by those large players is no longer supported by Apple.

Turning to the future I want to spend a few moments highlighting our growth drivers.

I mentioned, both single tap licensing and postpaid content media earlier in my remarks as strategic growth opportunities, but also as we've mentioned on prior calls we want to build a shopify for app stores on device.

We believe we are uniquely positioned with our on device technology.

Our publisher relationships, and our operator and OEM relationships.

We also believe that pending global regulatory environment will provide additional thrust to this vision.

And to achieve this vision there are some market pain points, we will be solving including making it easier for app publishers to port their apps into the new platform managing payments installing the applications and managing curation of the micro stores.

I'm, making it easier to port absent managed payments, we took our first step in accelerating our efforts in this area by taken an equity position and an alternative app store called Apt toyed, which has approximately 250 million users 10 billion downloads and over 1 million applications.

Combining these capabilities with things like single tap will make installed easier for consumers.

And we can further leverage our on device position with ignite to drive artificial intelligence and machine learning to focus on the right apps to the right features on device versus the customer being overwhelmed and being dumped into a big app store with millions of applications to choose from.

The alternative App stores will help us further leverage our AD tech assets with application supported by in App advertising revenue, but the App stores will also help us with our first foray into the in App purchasing market, which is over $100 billion global addressable market today.

You will see us refer to this business as our hub business and variance of the hub, whether that are things like games hub apps hub and so on.

We anticipate launching our first integrated effort with a leading U S. Operator in early 2023 and if we.

We have received strong global market feedback from our strategy and approach.

Okay.

We're also making many organic product enhancements to our AD tech platform, including adding new AD units, new formats, New partners, new demand improvements to our mediation and new bidding methodologies.

The historical add Tony and fiber businesses, we're very simple in their approach to both the gaming and single video format that.

That focus served them well, but also materially limited the market opportunity.

We want to build on that success and have been busy building. Many new capabilities that are just beginning to launch in the market and should serve as a nice growth catalyst and how we can cast a much wider net for the AD dollars that are out in the market.

To accomplish all of these new growth areas allocating resources will be key.

I believe a competency of our business has been our resource allocation against our strategic priorities.

Unlike many tech companies that overstaffed during the pandemic, we remained efficient and focused with each DT employ now contributing in excess of $200000 of EBITDA, which would put digital turbine and the top tiers of profitability per employee across any industry not just technology.

On a pro forma basis, our total head count is actually lower by approximately 20% compared to 2020 as a result of cost synergies and is lower today than a year ago at this time.

But we've been able to simultaneously make new strategic resource investments against our priorities discussed earlier in my remarks.

This disciplined approach to managing investments and expenses has been part of our culture since the beginning and is now serving us well as we see many others, having to freeze hiring or lay people off neither of which are we are doing at this current time.

We are surgically hiring against our strategic priorities include hiring a new chief Technology Officer Central Qumran.

Central joins us from meta and brings over 20 years of technology leadership and AD Tech telco software hardware and product leadership.

He has a very strong addition to our executive team and looking forward to his immediate contributions.

And in conclusion, we are seeing some macro headwinds, but we believe they're temporary and I know many investors are short term focused but we are very confident in our future and confident in the investments, we're making to drive long term value for digital turbine.

With that this concludes my prepared remarks, and I'll turn it over to Barrett to take you through the numbers.

Thanks, Bill and good afternoon, everyone. Our Q2 results reflect our continued focus to deliver sustainable profitability as we made conscious efforts to expand our gross profit and EBITDA margins even during these dynamic times.

Before I begin as a reminder, we passed the anniversary dates of our acquisitions made last year and will no longer referring to results on a pro forma basis.

Revenue of $174 9 million in the quarter was down 7% year on year. Despite a softer AD market. Our AGP business grew 6% driven primarily by growth on the exchange platform.

Our <unk> segment was down 16% over prior year, largely driven by the near term headwinds Bill discussed as we evolve our content media products.

Which were partially offset by the modest growth experienced on our App media products as North America RPT yields continue to expand.

As I've mentioned previously in this environment global companies are facing headwinds driven by the trending strength in the U S dollar.

Fortunately foreign exchange rates have had only a modest impact on our revenues. Despite the macro climate. This is due primarily to our current business model, where we're the only have modest foreign exchange exposure given the majority of our revenues and expenses are nominated in U S dollars.

Our margin expansion efforts enabled gross profits to increase 1% to $90 5 million and.

And gross margin on the platform expanded to 52% in Q2 up from 48% as reported in the prior year.

And up sequentially from 50% in Q1.

While continued focus on margins enabled expansion across all our business lines are odious segment.

As an important driver in the year on year improvement. In addition to our core business expansion. We also experienced a benefit in the quarter from our renewed partner agreement and enhanced margins.

And as a reminder, while gross margin rates can fluctuate from quarter to quarter. We generally anticipate long term margin expansion as we continue to execute on our growth and synergy strategies.

We continue to deliver cost efficiency on the platform.

As cash operating expenses were $42 3 million in Q2, which were flat to prior year and represented 24% of revenues in the quarter.

Total operating expenses were $67 7 million, which were also constant sequentially and lower compared to total operating expenses of $72 7 million in the prior year, while we remain disciplined with operating expenses the realized efficiencies in our cost structure have enabled funding measured.

Investments focused on our teams our infrastructure and new growth priorities.

These near term investments are anticipated to drive continued benefits to be realized over the coming quarters to further improve our efficiency and our operating leverage.

Our adjusted EBITDA of $48 2 million in the quarter increased 1% over prior year and our EBITDA margin expanded to 27, 6% up approximately 200 basis points over the prior year.

And we're pleased to deliver in Q2, our sixth consecutive quarter of sequential EBITDA margin expansion.

I am proud of the durability of our operating model and our EBITDA growth and margin expansion that is all being achieved.

Especially in a challenging macro environment.

I continue to be pleased with our profitability and free cash flow.

Delivered in our business in the quarter, we achieved non-GAAP adjusted net income of $35 million or <unk> 34 per share as compared to a $45 3 million or <unk> 44 per share in the second quarter of last year.

While income from operations improved over prior year, we incurred greater interest expense driven by rising rates, partially offset by reduction in our debt balance we have higher taxes relative to the Q2 and last year as expected primarily driven by lower tax benefits from stock based awards and greater income.

In foreign jurisdictions.

Our GAAP net income was $11 7 million or <unk> 11 per share based on $103 million.

Diluted shares outstanding.

Compared to prior year net loss of five 9 million or a loss of <unk> <unk> per share.

Healthy free cash flows for the quarter of $22 4 million enabled us to exit the quarter with $82 7 million in cash after paying down $26 million of debt using our free cash flows from operation to further deleverage our debt position.

Our debt balance ended the quarter at $450 million drawn on our revolving credit facility and as our business continues to produce strong free cash flows we would expect to continue to pay down our revolver.

We are confident in our balance sheet and our capital position given our profit model with expanding margins strong cash flows and access to low cost credit facility.

While we expect these market conditions to be temporary we are well positioned to resume to stronger growth when the macro landscape improved now.

Now, let me turn to our outlook.

As we consider the ongoing uncertainties in the macro environment. We currently expect revenue for Q3 to be between $180 million and $190 million and adjusted EBITDA to be between 53 and $57 million.

And non-GAAP adjusted net income per diluted share to be between 36 and.

<unk> 39 cents.

Based on approximately 104 million diluted shares outstanding and an effective tax rate of 25%.

With that let me hand, it back to the operator to open the call for questions operator.

We will now begin the question answer session.

Ask a question you May press Star then.

Keith.

If you are using a speakerphone please pick up your handset.

Ricky.

Your question. Please press Star then two.

At this time, we will pause mode.

Sure.

Sure.

Our first question comes from Dan.

<unk> Securities.

Please go ahead.

Yeah, Hey, guys I appreciate you taking the questions. So it looks if I'm doing the math right.

Based on a couple of the things you provided in the prepared remarks, it would seem that content media revenue was down a little over 40%, but with this trend.

Transition to postpaid in mind, so maybe if you could just first if you could just confirm that's about right and then if you could just walk investors through the expected revenue ramp.

How long you think it should get back to the pre transition levels, where we are with the Verizon AT&T potential.

Potential partnerships and then.

Whether you might get some of the business from T mobile.

It's been lost in the prepaid side back on their postpaid side at some point.

Yes, Thanks, Dan Hey, just on the numbers, yes, we did reference we don't break out the content specifically, but we this segment we report ods.

It was we did reference it was it was impactful overall, excluding that our content business.

At media business was up slightly.

I'll, let bill answer address the strategic Yeah, Yeah, sure Hey, Dan and as you said the first thing I'd say is it's just as a reminder.

Minor for us.

And between 80, and 90% of our revenues of our company come from something other than this just as just for context, but as it relates to content media specifically, yes, we've been really beginning to focus a lot more on the postpaid product, we want to get better quality for our advertisers.

And you know really get after the broader market that goes with postpaid. So we've been really focusing our resources on deploying that and as I mentioned in my remarks.

We're starting to see some some nice traction.

With that now we've got to turn that nice traction and engagement into revenue, which is what we expect to happen as we get back into 2023, but it had that.

That focus has negatively impacted our prepaid business.

And so we've seen some declines in daily active users as a result of that but we expect that to resume as we get into 2023.

Awesome, Thanks, Bill and then one.

One of the things you talked in the prepared remarks about sort of this delay between when you get the licensing deal when it starts to generate material revenue.

Like the perception from some investors is you are going to strike. These deals and then they turn it all on the platform and then the money starts flowing and clearly it's more complicated than that so maybe if you could just walk us through why.

Why that is and so we can understand a little better why there might be a delay between.

Getting a deal in single type revenue coming in.

Yeah sure I think one thing its important for investors to understand about single tab. This is really an enablement capability and we've got four different types of revenue streams that we have a single tap we've got it in our DSP business, we run it through our legacy AD colony business, just integrated into our fiber exchange business and then the fourth part is the licensing business.

It's attracted a lot of investor attention in a market. We're excited about in that fourth part of it.

Really just view this as very similar to when we started the dynamic install business. Many many years ago, where you start with one material player you get going then that player wants to expand and do more and more whether that's in more and more geographies are more ad types or whatever whatever happens to be in this case and then continue to expand it to other providers, but you go deeper with.

And once you've got you go broader with new ones, but I think that kind of sequential growth is something that we just want to make sure. We manage expectations. We're very excited about it we've run our models, we know what it looks like internally. We think this could be really big but at the same point of time, we don't want to get over our skis in terms of managing expectations on it because there are a lot of last mile operational issues.

That are associated with getting this thing going and ramped and Thats where were really focused right now.

Yeah.

Okay. That's all I had guys. Appreciate you taking the time best of luck.

Thanks, Dan.

Our next question is from Darren.

With Ross.

Partners. Please go ahead.

Hey, guys. Thanks for taking my questions and nice job on the cash flow could.

Could you just kind of give us an update bill.

Bill with everything that's going on with Europe , just the Samsung skews the relationship there or are you guys.

Seeing any better traction than kind of your commentary last quarter and then my second question on the licensing business for single tap.

You mentioned, some some tier one wins in Google cloud like do you feel like you've finally hit an inflection point or this is going to be more of a roller coaster ride maybe like the early days of dynamic install thanks.

Yeah sure. Thanks, Darren yes, so far.

First on devices I was really pleased in this in this environment you know to have 75 million devices put on the board I think that's a record for US all time and in this environment and as I mentioned in my prepared remarks, the vast majority of that was internationally, which obviously Samsung is a major contributor I believe the largest contributor.

All of those around the world. So we're pleased with that.

We're going to look to continue to expand that number I think one of the things that negatively impacted not just us but everybody. During COVID-19 was working life different kind of global relationships to add more supply and we're starting to see kind of a a rethink of that as operators and Oems are looking for new revenue streams and so you know obviously, we provide that to them. So I would expect to see it.

Traction and momentum on that regarding the inflection point question, yes.

Yes, I think we're at a point now where we've taken this from a great idea to now getting signed contracts seen a little bit of revenue roll in but as I mentioned to Dan earlier Im just wondering should we temper our expectations. We're excited about it we do think we're at an inflection point, but we want to make sure that we manage expectations around it so we don't get over our skis.

Those are things in mistakes, we made many many years ago in the past back to you referenced on the dynamic install business and so want to make sure. We don't repeat that so we do want to continue to focus on how we can under.

Under promise and over deliver there.

If I could sneak in one more maybe for Barrett your comments about deleveraging like what's your kind of general rule of thumb about cash free cash flow generation relative to <unk>.

Debt pay down.

Yeah. So so are our view on on our long term EBITDA conversion to free cash flow Hasnt changed we still been in the we still view that as the 70% to 80% just given the nature of our financial engine.

So at that rate you could you could assume that we don't have a lot of.

Assets that were going to be investing in and so if there's not an opportunity.

Turn that that free cash flow.

We direct that towards paying down our debt.

So Darren you got it.

70% to 80% over the over the year and apply that to debt pay down.

Thanks Kurt.

Question is from.

Okay.

Bank of America. Please go ahead.

Hey, guys. Thanks for letting me ask a question here.

Just wanted to ask about any progress on be a single tap fiber integration.

I'm wondering if that has launched and if there's anything worth calling out in terms of flows and demand that you're seeing there.

Yes, sure Omar Yeah, So we soft launched it and we've enabled it right.

Right now we're pressure testing it with the DSP is that plug into fiber and we want to make sure. We've got that right relative to our own DSP performance and so we're doing a lot of kind of AB testing around that to make sure that it's meeting their expectations in terms of return on AD spend versus just sheer number of installs. So I'd say, we're being pretty cautious.

With it but we're very excited about it.

And do you have any sense of when we might be able to see incremental revenue from that in the next year.

Yes, I would expect as we get into it as you see us get into future quarters, we're going to see incremental revenue from that absolutely.

Thank you.

Yep.

Okay.

Next question is from Anthony Stoss with Craig Hallum. Please go ahead.

Okay.

Congrats on the nice margins Bill just getting back to single tap for a second here I know theres been a lot of custom work.

For a bunch of these tier ones have you learned a lot through this process, where you can potentially onboard other tier ones much quicker and I'm curious if you think you can take on several new launches per quarter.

And then I had a follow up on after that after that.

Yeah, sure Hey, Tony Thanks, Yes, we're working on that right now and Thats, a major focus area. Some of the stuff I'll call. It it's not necessarily the sexy stuff in terms of announcing some of the larger deals.

In the implementation and what we've learned in the early days, when we launched with Verizon and Samsung and AT&T and our dynamic install business that last mile of execution and high scale that last mile of execution is just critical to success and so.

Absolutely working on how we automate and we've learned a lot for that versus getting into a variety of bespoke solutions, but we do have to work to integrate with these partners and so the work isn't necessarily difficult. The work that has to get integrated into their existing processes.

And that's something I think it probably has been the hardest thing for us in terms of taking the time to get going but I think we're making some material progress against it and very excited to see how this business can play out for us in 2023.

Got it thanks for that and then Bill you seem pretty excited about this combo. After the launch in early 2023 with a U S. Operator, any more detail you can share or maybe the revenue impact and then I wanted to sneak in one for Barrett just kind of thoughts on gross margins higher next year fiscal year than this year still.

Yes, so as we think about the.

The alternative App store space and work on our hub internally, we think theres a real opportunity for curated App stores, just like in a regular world today, we will go to Amazon and buy stuff in the E Commerce World.

But we also see things in our local stores are powered by Shopify that are maybe more curated for our own personal experiences and given our unique position on device.

We've got a really good at bat here to not just leverage our AD tech assets for in App advertising, which we're doing but also is our first foray into in App purchasing and as I mentioned my remarks, that's $100 billion market. So if you can think about US now collecting dollars in terms of acquiring new users collecting dollars for the advertising inside those apps and now expanding that to.

Another dimension with DNF payment piece of this I mean, I think that adds a nice revenue growth opportunity for us and so we're going to get this going off the ground.

Early next year, but I think the thing that also will be exciting and now that we're getting over mid terms is how the regulatory environment goes we see all of the digital markets Act in the EU just get passed since in the process of getting implemented.

To see now some legislation getting going here in the U S has bipartisan support that.

It could be a real nice tailwind and thrust to our activities in this space.

Got it thank you.

The next question is from Arthur Chu.

Okay security.

Go ahead.

Oh, Hey, thanks, Thanks for taking my question I actually my question was just asked by all myself nor I.

Thank you guys.

This concludes our question and answer session I would like to turn the conference back over to CEO .

Sales for any closing remarks.

Yes. Thank you all for joining the call today, and we'll look forward to reporting on our progress against all the points. We made on today's call. We'll talk to you again in our fiscal 2023 third quarter call in a few months, thanks and have a great night.

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