Q2 2023 Paymentus Holdings Inc Earnings Call
Yes.
Okay.
Good day and welcome to pay me emphasis second quarter 2023 earnings call.
This call is being recorded and all participants are currently in a listen only mode.
There'll be an opportunity to ask questions. Following management's prepared remarks, and if you would like to ask a question press star one on your telephone keypad.
At this time I will now turn the call over to David Hanover Investor Relations. Please go ahead.
Yeah.
Thank you good afternoon, and welcome to the payment of second quarter 2023 earnings call. Joining me on the call today is Shawn Sharma, our founder and CEO and Sanjay Kalra our CFO .
Following our prepared remarks, we'll take questions.
Our press release was issued after the close of market today and is posted on our website, where this call is being simultaneously webcast.
A replay of this call and the supplemental slides accompanying this presentation will be available on our company's website under the Investor Relations link at IR document this dot com.
Statements made on this webcast include forward looking statements within the meaning of the private Securities Litigation Reform Act of 95.
Forward looking statements use words, such as will believe expect anticipate and similar phrases, but they're not future expectation regarding our financial results and guidance the impact of and our ability to address the continued economic uncertainty in inflation or market opportunities business strategies implementation timing product enhancements impact from acquisitions and other matters.
These forward looking statements speak as of today, and we undertake no obligation to update them.
These statements are subject to risks uncertainties and assumptions that may cause actual results to differ materially from those set forth in such statements, including the risks and uncertainties set forth under the captions special note regarding.
Forward looking statements and risk factors in our annual report on Form 10-K for the year ended December 31 2022, our.
Our quarterly report on Form 10-Q for the quarter ended March 31, 2023, and our quarterly report on Form 10-Q for the quarter ended June 32023, which we expect to file with the SEC shortly and elsewhere and other filings with the SEC. We encourage you to review these detailed forward looking statement safe Harbor and risk factor disclosures.
In addition, during today's call, we will discuss certain non-GAAP financial measures specifically contribution profit.
Adjusted gross profit non-GAAP operating expenses, adjusted EBITDA and adjusted EBITDA margin.
Yes.
Initial measures, which we believe are useful in measuring our performance and liquidity should be considered in addition to and not as a substitute for or in isolation from GAAP results.
We encourage you to review additional disclosures regarding these non-GAAP measures, including reconciliations of the most directly comparable GAAP measures in our earnings press release issued today and the supplemental slides for this webcast each available on the Investor Relations page of our website.
With that I'd like to turn the call over to just shot Sharma, our founder and CEO two shot.
Thank you David.
We had an excellent quarter over this strong growth in revenue contribution profit and adjusted EBITDA, All finishing ahead of our expectations.
Revenue increased 24, 1% on a year over year basis.
$248 $9 million.
Contribution profit for the quarter was $59 $6 million representing growth of 22, 3% year over year.
Approximately trending in line with our revenue growth.
Although adjusted EBITDA for the quarter was $14 $2 million, which was up 183, 8% year over year.
We are very pleased with the fact that we added $10 $9 million in contribution profit over the comparable quarter of continuing to do.
It dropped over $9 million of back to adjusted EBITDA.
So essentially.
The majority of the incremental dollars, we generally dropped to the bottom line.
We were able to achieve this while delivering revenue and contribution profit growth in the low to mid 20% range.
We also accomplished this without sacrificing investment in Alberta in ovation framework to drive future long term success.
While we're excited about our performance for the second quarter. There is still some uncertainty about the impact of economic environment and seasonality.
Their Sunday will address in a few minutes.
Now, let me cover some key second quarter business highlights and accomplishments.
From a bookings perspective, our performance in the quarter and the entire first half of <unk>.
Was significantly better than the same period until it wanted to.
As a result of this and our continued sales momentum.
We continue to enjoy the benefit of a strong backlog at the end of the quarter.
Given this we are confident about the rest of the year and believe we are strongly positioned for 2024.
Our bookings results continue to support our belief that we're partners universe <unk> platform is universally is scalable to any vertical in any business of any size and complexity.
For example, this quarter.
For love duo full or larger bookings.
One of the deals sector.
We also signed a large insurance company and a large telecommunications client along with there were several locks along with several large utilities and government agencies.
And in addition, we signed a global technology services provider that serves over 100000 domestic and international small businesses.
During the quarter. We also lead also remained focused on onboarding clients at a faster pace.
We have continued to make investments in this area, which we believe are yielding strong results.
The number of bullets implemented in the quarter increased significantly year over year, while the average time to implement the biller decreased during the same period.
We implemented several large clients during the quarter and we expect these clients to start contributing meaningfully in a couple of quarters as they fully ramp up their volumes.
These clients are in a variety of industries, including financial services utilities.
Government agencies and others.
We believe both spend dummy conditions are making it easier for us to have more meaningful face to face interactions with our largest clients during the implementation process.
We are now able to collaborate with our clients more closely as we onboard a sophisticated and complex workflows.
So put things in perspective from a sales and operations standpoint.
During the second quarter, we saw increased bookings.
Increased backlog and improved implementation timelines, all working favorably year over year and contributing to a water business growth.
During the quarter.
We also expanded our partnership distribution ecosystem with new relationships across a range of diverse verticals, such as property management utilities and government agencies.
We also continue to see momentum in all of our IP in our instant payment network ecosystem.
There is a lot of demand for our network. We also see IP and playing an increasingly larger role in bringing customers banks financial institutions and pillars closer together as banks focus more towards RTP fed now and real time processing in general.
As you know our instant payment network.
Entered around real time payments between banks and pillars and we are excited that as far as are now focused on real time processing, which has been over mission since our inception.
Yeah.
We are also announcing a new addition to our IP in which we're excited about.
With full integration into IPM millions of American Express card members can now be the American Express bill using the Paypal App in real time.
So in summary, we made substantial progress during the second quarter, which is reflected in our excellent results with.
We continue to invest in our future and are excited about the long term growth potential for our business and.
And look forward to keeping you bid on our continued progress.
Now, let me turn it over to Sanjay to review our financial results in greater detail.
Thank you Sean and thank you all for joining us today.
Before I discuss our quarterly results and outlook I'd like to remind everyone that the financial results I'll be referring to include non-GAAP financial measures.
As David mentioned earlier of our Q2 press release and earnings presentation includes reconciliations of the non-GAAP financial measures discussed on this call to their corresponding GAAP measures.
Both of these are available on our website.
Turning to slide five.
For the second quarter of 2023.
We delivered excellent financial results that were above the top end of our guidance.
We believe these results demonstrate the strength of our business, which continues to perform well despite continued macroeconomic concerns.
Our second quarter results included revenue of $148 9 million contribution probably about $59 6 million.
And I guess, you would you be now 14.2 million.
They continue to experience solid business momentum in the second quarter quite similar to what we saw in the first quarter.
This drove a robust bookings, enabling us to exit the quarter with a substantial backlog.
Based on our strong quarterly performance and the positive business trends <unk> mentioned earlier and a lot of expectations for the remainder of 2023.
We are raising our full year 'twenty two 'twenty three revenue contribution profit and adjusted EBITDA guidance, which I'll talk about shortly.
Now, let's review, our second quarter financials in more detail.
The number of transactions payment. This process grew $209 5 million in the second quarter, Oh go on Youtube, one 3% year over year.
As I mentioned Q2 revenue was $48 9 million up 24, 21% year over year. This growth was largely driven by increased transactions from existing builders the launch of new builders and increased activity in our instant payment network, our IBM business.
Okay.
Second quarter don't need only three contribution profit increased to $59 6 million up 22, 3% year over year.
The contribution profit increase reflects the increase in transactions from existing dealers and the launch of new <unk> that I mentioned earlier.
Contribution margin was 40% for the second quarter compared to 41, 6% in the prior year period.
Contribution profit per transaction for the quarter was 54 cents, which was the same as a variety of idiots.
In our last earnings call, we mentioned our contribution profit gorilla for Q1 significantly lag revenue growth for Q1.
Largely due to inflation and the onboarding of large customers there.
Also said, we expected that the gap will start converging in Q due primarily due to the active repricing conversations with other builders.
We are encouraged by the results of our repricing actions with the customers as well as other cost reduction initiatives, we have undertaken.
We also believe we have benefited from some level of this inflation in the utility sector.
And as a result contribution profit annual growth of 22, 3% was very close to the annual revenue growth in Q2 of 24, 1%.
As we've noted in the best variables outside of our control such as increase in the average payment amount or changes in the payment mix can significantly influence the contribution profit on a quarterly basis.
Adjusted gross profit was $50 million for the second quarter up 29, 1% year over year.
non-GAAP operating expenses, a new measure we are introducing this quarter increased to 37 8 million.
Up six 4% year over year.
The increase was primarily due to higher sales and marketing expenses as we continue to focus resources on our go to market strategy.
Previously, we did not have a non-GAAP metric for operating expenses.
non-GAAP operating expenses exclude stock based compensation and amortization of acquired intangibles from GAAP operating expenses.
We believe that providing this metric will provide greater overall transparency into our business and performance.
Adjusted EBITDA for the second quarter was $14 2 million or 23, 8% of contribution profit up 183, 8% compared to 5 million or 10, 3% of contribution profit in the prior year.
This strong performance compared to our guidance provided last quarter was driven by four key factors.
First the second quarter benefited from some level of this inflation of CPI in AG services Index.
Second we began to realize the benefits of our re pricing conversations with customers and cost improvement initiatives earlier than anticipated.
Third our implementation pace quickened during the second quarter, which enabled us to successfully launched bidders ahead of our original plan.
And fourth our hiding expected expectations progressed slower than planned in the quarter.
Resulting in lower operating expenses.
I believe the strong adjusted EBITDA margin demonstrates the inherent operating leverage we have in the business and our ability to adapt to changing market conditions as they continue to grow.
Other income was $1 7 million during the second quarter, reflecting increased interest income from bank deposits and effective cash management.
non-GAAP net income was $10.2 million or eight cents per share compared to non-GAAP net income of <unk> 9 million or <unk> <unk> per share in the prior year period.
Please note that beginning this quarter.
We have modified the calculation of non-GAAP net income.
non-GAAP net income now adjust GAAP net income for stock based compensation.
As a result of this modification non-GAAP net income adjusted GAAP net income for amortization of acquired intangibles and stock based compensation.
Now I'll discuss our balance sheet and liquidity position on slide six.
We ended Q2 with unrestricted cash of $59 1 million compared to $143 6 million at the end of Q1 'twenty three.
The $15 5 million increase is primarily comprised of $26 5 million of cash generated from operations.
Offset by $8 7 million used in investing activities.
The company does not have any debt.
The free cash flow generated during the quarter was $17 $8 million.
Although days sales outstanding at the end of Q2 was 41 days an improvement from DSO of 46 days at the end of Q1 'twenty three.
Working capital at the end of Q2 was approximately 190 million an increase of approximately 9 million from the end of Q1 'twenty three.
We had 194 million diluted shares outstanding as of end of June 32003, compared to $123 8 million diluted shares outstanding at the end of Q1 'twenty three.
The margin increase was due to the vesting of employee restricted stock units and exercises of stock options and improved average stock price during the quarter.
Now I'll turn to our non-GAAP guidance for Q3, and <unk> III and Q4 'twenty to 'twenty three beginning on slide seven.
In Q3, 'twenty three we expect revenues to be in the range of $150 million to $154 million, representing 19% year over year growth at the midpoint.
Contribution profit to range from $58 million to $60 million, which is 15% year over year growth at the midpoint.
Adjusted EBITDA of $9 million to $11 million, representing growth of 25% year over year at the midpoint.
The reason adjusted EBITDA is projected to not be quite as strong as Q2 is partly because of increased hiring that began in July reflecting over return to plan in that regard.
The typical Q3 summer seasonality.
And the extreme weather conditions, we saw during July and that we believe are likely to continue into August .
Lastly, this guidance does not anticipate that continued this inflationary trend in energy prices that we saw in the second quarter.
In Q3 hundred 93, we expect revenues to be in the range of $1 $52 million to $158 million contribution profit to range from $60 million to $65 million and adjusted EBITDA of $9 million to $13 million.
Given the considerable progress we have already made in the first half of 'twenty three.
And our expectations for the remainder of the year for the full year 2023 on slide eight we now expect revenue in the range of $599 million to $609 million.
Up 1% from the midpoint of our previous guidance.
Contribution profit in the range of 231 million to $238 million.
One 5% at the midpoint versus our prior guidance.
And adjusted EBITDA to range from $41 million to $46 million, representing a 20% increase at the midpoint versus our previous guidance.
In summary, we reported excellent second quarter results in the first half of 'twenty. Three we have continued to build on our solid momentum from Q1, 'twenty three with strong revenue contribution profit and adjusted EBITDA and bookings growth.
This enabled us to end the second quarter with a solid backlog.
As a result.
We have strong visibility and believe we have positioned ourselves well for the balance of 2023 as well as into the next year.
Thank you everyone for your attention today and now I'll turn it back to <unk> for final remarks, before we open up the call for questions.
Thanks Andrea.
In closing we're excited about the long term prospects of the business.
We believe we are well positioned to leverage our ecosystem, our payment operating system and the various applications, we support to grow our business.
We are dedicated to our goal of delivering expanding EBITDA margins.
While growing our business over the long term.
Our approach of sensible profitable growth has served us well to this point and we believe that our approach will continue to serve us well in the future.
Also as an organization.
<unk> dedicated to incorporating environmental social and governance or ESG practices into our operations.
As such I'm pleased to announce that we have recently bolstered our 2023 ESG report on our IR website under the governance section.
We are proud of what we have achieved in these areas and two shared this ESG report with you.
Also want to take this approach you to thank my colleagues at <unk>, who work tirelessly to serve our clients. Thank you.
That concludes our prepared remarks, and I'll now open the line for questions.
If you would like to ask a question press star one and your telephone keypad.
In terms of your question Press Star two.
And if youre using a speakerphone please pick up your handset before asking your question.
Our first question comes from Dave Koning with Baird. Please proceed.
Yeah, Hey, guys, great Great result.
And I guess my question Yeah, Yeah sure. My first question network fees were down dramatically sequentially, I think 87 or 82 per transaction set at <unk> 87, and much more like the normal range is.
Is that now that utility inflation is much lower is that kind of are we back at kind of a more normalized.
Network fee per transaction.
Well there is a there is a variability quarter over quarter in terms of the fee and what the rate average you will get but overall, we are pleased with the significance significant improvement we saw this year and the trends we are seeing Dave and definitely the CPI index does help overall, but the plans could be.
In a very close range I would say over the quarters.
Yeah. Okay. Okay. Thank you and then I guess my follow ups.
David If I may there's also seasonal impact as you know.
Similar as Sanjay mentioned earlier that.
Someone has been rather temperatures that meet all the heart and so we are watching that as well.
Got you Okay. Thank you on that and then I guess my follow up.
Your incremental margins have been very good in recent quarters and were tremendous this quarter, I think 85% incremental margin year over year.
The cost like I know you said that this quarter costs were managed really closely when they do start to ramp again, I mean is it really sales and marketing that ramps and maybe SG&A and D&A R&D are those a little bit more stable going forward like theyre not going to ramp as much as sales and marketing.
Oh, that's right. They are relatively easy isn't marketing will ramp up more than G&A and R&D, but this quarter, we saw some benefit.
In Q2, we were actually slower in our pace of hiring than we originally anticipated. So there is some element of that in Q2, but in Q3, we are coming back to that level, but you are correct in your assessment of which part of Opex is going to be higher than others.
Gotcha, great job guys. Thank you.
Thank you Dave.
Our next question comes from Ashwin <unk> with Citi. Please proceed.
Hey, guys. So congratulations from me as well.
I wanted to pick up on a point that I think Sanjay mentioned faster implementations.
Could you delve a little bit more into that.
What are some of the.
Some of the changes that you've made and how.
How sustainable.
Are they I mean were these.
You know.
Synthetic focuses on specific clients to get it done or was it more of a process.
Improvement that might be more substantial if you could comment on that.
Sure I think there are three factors I would say first would be the.
Understanding of the complex and sophisticated workflows that we implement for clients and then therefore incorporating them into our platform based core platform itself, so making changes.
There and.
Putting some tooling in place the second would be.
The process itself.
How we are.
Onboarding and Javier interacting with the clients and the third is the point I made.
That the face to face interactions, especially in the large and complex sophisticated clients.
Has made a huge difference for us in the post pandemic conditions many of times Youre able to go when we see that there is a potential.
Off white boarding something to get to a conclusion very quickly so that we can.
Continued don't lose our momentum on the implementation process, we are right in front of our clients and whiteboard solutions and get to the next stage. So some of that is very helpful to us.
Understood. Thank you for that and then.
Congratulations again on the American Express.
Paypal and getting done.
Maybe if you can comment on.
Sort of the impact.
From a financial model perspective, as you sort of look at it the impact of.
The partner based approach being becoming more important horses horses direct.
Is that beginning to make a difference because that RBS meals. So has it has an impact on now on which lines that impact if you could sort of walk through and remind us of that that would be great. Thank you.
Yes, that's a great question Ashwin actually.
One of the key areas, which we have been focused on as we've shared in the past that.
The way we have we have gone with our strategy here is that we are building an ecosystem through our IP and partners IBM partnership, but also our bank and other Fintech partners as well as our software partners.
If you look at our partner ecosystem, it has never been broader and better.
Right now there's tremendous momentum there just because of all the capabilities, we offer and the breadth of the network that exists. So that is all translating into momentum.
In bookings and as well as the pipeline in.
In addition to the direct direct sales so.
Some of the direct sale of some of the sales and marketing expenses were making there also doors.
Developing the partner ecosystem or growing the existing partner ecosystem growing with our existing partners as well. So this is actually working extremely well for us.
Yeah.
Great. Thank you.
Our next question comes from John Davis with Raymond James. Please proceed.
Hey, good afternoon guys.
Sanjay called out several <unk>.
Factors for the <unk> upside relative to your guide, but none of those seem to be kind of onetime in nature.
The charter Sanjay maybe you can help me just kind of square that with the fact that the guide implies.
700 basis point do you sell on contribution profit grow with about 650 basis points of lower margin in <unk> versus <unk>, maybe just conservatism anything timing related work or you can accomplish there.
Yes, sure John that's a great question and I'll start I talked about four key factors in Q2, which we noted because of the <unk>. The performance is good in terms of EBITDA.
Compared to what we guided and I can cover all of the floor.
The first one is mainly we saw a level of inflation of the CPI Energy services Index and this is the first quarter of Mds seen it coming and I think once establishes a trend it will get into our numbers, but as of now we have not factored that in Q3.
He is not easy as you would understand to forecast what the CBA index would do so if you consider that that's happening in Q2, but not counted in beauty.
Our second we realized we began to realize the benefits of our repricing conversations with customers and that was actually originally planned to happen in Q3, So we pulled out and in Q2, our teams did a phenomenal job in making those negotiations and closing those deals sooner than expected. So that's an upside book.
But there are already planned for Q3, what that does is it basically kind of guarantees as more of that more confidence that in Q3 is going to happen because it's already done in Q2.
So thats not an upside in Q3 versus Q2, but Q3 was already there and cost improvement initiatives as well we had planned some cost initiative improvements, which is basically working with the card networks on their plans are based on certain information and meet the team did a great job. There. So that was accomplished in Q2 as well.
And that was planned in Q3, so thats considered that happening sooner as well now the implementation phase which has picked up.
This is this is great.
And this has been.
There is some southern implementations of the planned in Q3 and they started happening in Q2, so thats a pickup in Q2 and in Q3. They are already on the plan and I would say the last piece is that the hiring expectations in Q2 game slower because we didn't hire as many people, but we are getting back on our original plan.
To fill those positions in Q3, so that's kind of the.
Comparison of each of those key items. So you will see that some of them are continuing some of them could be upside and some of them will not because they're already happened they were already planned in Q3.
Okay, Great that's super helpful and the shop, maybe as a follow up you have a lot on the $60 million of cash on the balance sheet cash flow positive business margins and putting the right way how should we think about capital allocation and kind of what are your priorities.
Are you guys looking for tuck ins anything more transformative just wondering update on a capital allocation perspective.
Paul the kitchen processes.
Sure.
Right now.
First of all.
If I may make a comment on that yourself that we're very proud of the fact that we are able to demonstrate the operating leverage that business has.
And especially combined with the growth.
So thank you for noting that are cash flow positive business.
We are there isn't a whole per CVC and our product portfolio.
Which we are actively trying to fill so we feel that we are well positioned right now.
For the further growth we are setting our hour.
Ourselves up for from a product and the capabilities perspective. However, we were opportunistic in the market. The way they are we get to see.
Laura books, obviously.
We will continue to do that.
Nothing specific planned right now.
Yeah.
Okay I appreciate the color thanks, guys.
Thank you.
Our next question comes from Tencent, Hawaii with J P. Morgan. Please proceed.
Okay.
Alright. Thank you nice results. So just following up on Johns question just with the.
The repricing piece.
What percent of your of your target.
Our book of business that Youre looking to reprice have you completed at this point or or was all of it achieved in the second quarter.
Great collection Davidson.
I would say that most of the improvement occurred in Q2, there is still more to go but I would say a significant piece happened in Q2. It now its becoming part of a regulatory process.
New builders are getting signed and as our contracts already and Dale a provision that the pricing would be changed based on CPI. So overall going forward the process will be better but if the question was more in terms of catching up with the existing previous Miller's I would say a big piece happened in Q2, and so that's going to reoccur every quarter and Thats big and doable.
<unk> already.
Right.
Matt right. So there is there will be a recurring piece, but it sounds like there'll also be maybe some incremental benefits as well I know there is some other offsets, but I just wanted to.
Isolate the pricing part and then just given the.
Does this inflation comments as my follow up question, just the spread between <unk>.
Contribution profit and revenue I know, it's implied in your guidance here, but can we expect that generally two to track tighter or narrower here.
<unk>.
This disinflation theme.
<unk> continues just just trying to understand a little bit better. Thank you.
Yes.
If this trend continues.
You're going to see that.
What you said could be the expectation, but what we have seen is that the seasonality and the variability among the quarters exists. So I think if you factor that into consideration I would say then your assessment is right.
Okay. Thank you.
Our next question comes from Zachary <unk> with Ft partners.
Please proceed.
Hey, there. Thanks for taking my question I just wanted to ask quickly on sales and marketing you mentioned that some there, but we've had some conversations heidelberg highlighting a less competitive marketing environment, helping with cost efficiencies I was just curious what you all are seeing on that front and then maybe just as a follow up.
EBIT margins were pretty strong in the quarter at 24% when there's still a lot of headwinds going on with completion everything maybe sort of help us understand like what is the long term margin structure of the business looks any different today than at the time you went public.
Okay.
Yes, I think the market conditions have changed a lot the macro environment is very different than what it was when we went public.
So.
We are obviously.
Not guiding.
In any way shape or form but long term.
We are our target and objective would be to.
Grow the topline.
And the 20% range in EBITDA in the content and 30%.
A range of growth over the.
The dollar content.
Okay.
Got it thanks.
Going back to your first question on the sales and marketing I think the efficiencies. We are seeing we got a very strong pipeline in front of us and we are actually.
Trying to be opportunistic.
And see if we can improve our hiring in sales and marketing sooner in Q3. Our goal is to convert a big piece of the pipeline into bookings going forward as majority of the growth would come from there.
Makes sense thanks, guys.
Thank you for your questions.
As a reminder, it is star one to ask a question and start to term of your question.
Our next question comes from Jason Kupferberg with Bank of America.
Please proceed.
Hi, guys I know you mentioned some timing benefits on the expense side in the second quarter. I was just curious in terms of bookings because I know you talked about the bookings being robust again in Q2 was there any pull forward there or maybe just talk about your outlook for bookings in Q3 and Q4 just how.
Those might trend at least on a relative basis versus what you saw in the first half of the year.
Thank you.
The momentum for.
Our our.
Demand for our product continues to remain very strong.
At the beginning of the year, and especially dealing with the macro we were dealing with.
Typically somewhat of a preference anyway, but this is this year, where we were very focused that we wanted to get the first half of the year to be a very strong.
So the week have the biggest opportunity we can to implement some of these clients and get the benefit of those.
<unk>.
Yes.
In few quarters, especially in 2024, so that is one of the reasons for our focus but our outlook for the rest of the year remains as strong as well.
Okay, and then just on transaction growth.
'twenty two 'twenty, 3% through the first half same kind of question just.
Sustainability in the second half what's I know you don't guide explicitly on this metric, but I'm just wondering what's directionally assumed in your in your guidance for underlying transaction growth.
Well the seasonality.
<unk> in Q3.
<unk>, which is if you look at the trend in Q3 is seasonally.
Literally less than Q2, and Q4 as well from a seasonality perspective, the interchange does get impacted and hence our contribution profit does but in terms of transactions the number of transactions I think that.
If you leave the seasonality of the <unk> because there are some builders, which they only get paid only once a year twice a year versus many others, where we get paid every quarter. So I think that these year over year should improve given the seasonality would be similar.
So in terms of expecting the transaction growth for Q3, and Q4 I think looking at the trends of the past year would be would be a reasonable trend to look at.
Okay. That's helpful. Thank you.
Thank you for your questions.
There are no longer a question. Thank you. So I will pass the conference back to the management team for any closing remarks.
Well, thank you everyone for joining.
Really I appreciate everyone's time.
Great day.
Thank you.
Yes.
That will conclude today's conference call.
Thank you all for your participation you may now disconnect your lines.
Today's conference call.
Thank you all for your participation you may now disconnect your lines.