Q1 2024 Zedge Inc Earnings Call
Please continue to hold ladies and gentlemen, your conference will begin in two minutes. Please continue to hold your conference will begin in two minutes. Thank you.
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[music].
Speaker Change: Good afternoon, and welcome to <unk> earnings Conference call for the first fiscal quarter of 2024 results. During management's prepared remarks, all participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the Starkey followed by zero.
Good afternoon and welcome to Zedges' earnings conference call for the first fiscal quarter of 2024 results. During management's prepared remarks, all participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation by Zedges' management, there will be an opportunity to ask questions.
Speaker Change: After todays presentation by <unk> management, there will be an opportunity to ask questions.
To ask a question, please press star, then one on your touch tone phone. To withdraw your question, please press star two. That would out turn the call over to Brian Siegel.
Speaker Change: To ask a question. Please press Star then one on your Touchtone phone to withdraw your question. Please press star two.
Speaker Change: I will now turn the call over to Brian Segal.
Thank you, operator. In today's presentation Jonathan Wright, said just Chief Executive Officer at ESAI, said just Chief Financial Officer will discuss that just financial and operating results that were reported today. And before the key statements made during this conference call during the prepared remarks or in the question and answer session with a general or specific in nature, so object to risks and uncertainties that may cause actual results in the future to differ materially from those discussed on today's call.
Brian Segal: Thank you operator, and today's presentation, Jonathan Reich, <unk>, Chief Executive Officer, you site, such as Chief Financial Officer will discuss financial and operating results that were reported today any forward looking statements made during this conference call during the prepared remarks or in the question answer session, whether general or specific in nature are subject.
Brian Segal: Two risks and uncertainties that may cause actual results in the future to differ materially from those discussed on today's call.
He's a recent uncertainties include but are not limited to specific risks and uncertainties disclosed in the reports whose edge periatically files with the SEC.
Brian Segal: Risks and uncertainties include but are not limited to specific risks and uncertainties disclosed in the reports is that parent periodically files with the SEC.
such as no obligation to update any forwarding statements or to update the factors that may cause actual results to differ materially from those that they forecast.
Brian Segal: It just seems no obligation to update any forward looking statements or to update the factors that may cause actual results to differ materially from those that they forecast.
Please note that our earnings releases available on the Invest Relations page on this edge website. The earnings releases also been filed on form 8K with the SEC. I would like to turn the call over to Job.
Brian Segal: Please note that our earnings release is available on the Investor Relations page on <unk> website. The earnings release has also been filed on form 8-K with the SEC.
Speaker Change: Like to turn the call over to Jonathan.
Good afternoon, thank you, Brian , and thank you all for joining us today. I will start by briefly reviewing our first quarter results, which are primarily encouraging and are a consequence of the investments we made in fiscal year 2023, which we expect will continue driving sustainable, profitable, long-term growth.
Jonathan Reich: Good afternoon. Thank you, Brian and thank you all for joining US today I will start by briefly reviewing our first quarter results, which are primarily encouraging and are a consequence of the investments we made in fiscal year 2023 which we expect will continue driving sustain.
Jonathan Reich: Both profitable long term growth.
Jonathan Reich: Q1 revenue increased 3% from last year, as we continued managing geopolitical macroeconomic and industry specific challenges.
Q1 revenue increased 3% from last year as we continued managing geopolitical macroeconomic and industry-specific challenges.
Despite these challenges, ad revenue grew following four quarters of the quality. The F-Tick was driven by Zedge Marketplaces' improved performance and the Mojapedia, which was up 62%.
Jonathan Reich: Despite these challenges AD revenue grew following four quarters of the quality of the.
Jonathan Reich: The uptick was driven by his edge marketplaces improved performance and the <unk>, which was up 62%.
Zedge Plus, our Zedge Marketplace subscription offering, delivered exciting results with revenue up 10% from last year and also showing sequential active subscriber growth for the second quarter in a row following 6 sequential quarterly decline.
Jonathan Reich: As edge, plus or as edge marketplace subscription offering deliberate exciting results with revenue up 10% from last year and also showing sequential active subscriber growth for the second quarter in a row following six sequential quarterly declines these.
These factors led to record arc mal and 35% Zedg Premium GTV year over year growth.
Jonathan Reich: These factors led to record arc mail and 35% is that premium G. T V year over year growth.
Last quarter, we announced our commitment to building a full stack marketing team with capability spanning user acquisition, branding, creative execution, marketing, analytics, and reporting, competitive research, content marketing, app store and search engine optimization, and re-engagement marketing. Along those lines, we recently hired a seasoned head of user acquisition who was scaling our marketing investments in order to deliver positive return on ad span growth.
Jonathan Reich: Last quarter, we announced our commitment to building a full stack marketing team with capability spanning user acquisition branding creative execution marketing analytics and reporting competitive research content marketing App store and search engine optimization and Reengagement marketing.
Jonathan Reich: Along those lines, we recently hired a seasoned head of user acquisition, who is scaling our marketing investments in order to deliver positive return on AD spend growth.
Jonathan Reich: And now going to provide an update about each of our business units and or products paint.
I'm now going to provide an update about each of our business units and or product.
Paint is now more than a generative AI wall paper maker and continues to be a primary focus of the Zedge Marketplace. Take a look at what we have accomplished. Since our
Jonathan Reich: Paint is now more than a generative AI wallpaper maker and continues to be a primary focus of those edge marketplace.
Jonathan Reich: Take a look at what we have accomplished since our last call seven weeks ago.
First, we have made paint available globally, and are testing different regional business models in order to scale this feature. Next, we launched the beta version of paint for mobile web, which enables users to create all types of images, not only wallpapers, and seamlessly integrated it with print-on-demand functionality.
Jonathan Reich: First we have made paint available globally and are testing different regional business models in order to scale. This feature next we launched the beta version of paints for mobile web, which enables users to create all types of images not only wallpapers and seamlessly integrated it with print on demand functionality.
Jonathan Reich: <unk>.
This feature allows customers to purchase merchandise like t-shirts, pillows, coffee mugs, and more printed with their art. If this goes well, we believe the Zedge Website can fuel incremental growth, especially as we evolve the paint off.
Jonathan Reich: This feature allows customers to purchase merchandise like T shirts, pillows coffee mugs and more printed with their art.
Jonathan Reich: This goes well we believe this edge website can fuel incremental growth, especially as we evolve the paint offering.
Turning to Zedj Plus, our subscription offering, as you recall, we overhauled the Android offering in late fiscal year 2023, resulting in the second consecutive quarter of sequential revenue growth.
Jonathan Reich: Turning to his edge plus our subscription offering as you recall, we overhauled the Android offering in late fiscal year 2023, resulting in the second consecutive quarter of sequential revenue growth.
Almost in parallel, we introduced EdgePlus for iOS, which has been an early bright spot in driving subscription groups.
Jonathan Reich: Almost in parallel we introduced <unk> plus for iOS, which has been an early bright spot in driving subscription growth.
Overall, the iOS ecosystem is an untapped opportunity for us and has delivered attractive growth rates over the past two quarters, driven not only by the ZedgePlus subscription offering, but also by better optimization of our ad inventory and growth from paint. We remain committed to continuing to grow iOS, and generative AI may be key to unlocking this potential.
Jonathan Reich: Overall, the iOS ecosystem is an untapped opportunity for us and has delivered attractive growth rates over the past two quarters, driven not only by this edge plus subscription offering but also by better optimization of our AD inventory and growth from paint we remain committed to.
Jonathan Reich: <unk> to grow iOS and generate of AI may be key to unlocking this potential.
While emojipedia had another strong quarter, we believe there is more to come with continued product innovation.
Jonathan Reich: Although <unk> had another strong quarter. We believe there is more to come with continued product innovation.
Our previous investments in the website redesign, localization and technology upgrades are paying off. In fact, in November , Emojipedia recorded its best revenue month ever. With that success, we are now focused on testing new features such as Emoji Text Translation.
Jonathan Reich: Our previous investments in the website redesign localization and technology upgrades are paying off in fact in November emergent PD recorded its best revenue month ever with that success. We are now focused on testing new features such as emoji tax translations.
and mash-up emoji designs, as well as introducing new content verticals like emoticons, not to mention print on demand merchandising to name a few.
And mash up of motor designs as well as introducing new content verticals like emoticons not to mentioned print on demand merchandising to name a few.
Some of these will start rolling out in Q2 while others will become available later in the fiscal year.
Jonathan Reich: Some of these will start rolling out in Q2, while others will become available later in the fiscal year.
Jonathan Reich: As mentioned last quarter Guru shots is as had initially been the case with the motor PD are experiencing a revenue downtrend with growth taking longer to actualize than originally anticipated at the time of the transaction.
As mentioned last quarter, Gurushot's is, as had initially been the case with Emojipedia, experiencing a revenue downtrend, with growth taking longer to actualize than originally anticipated at the time of the transaction.
Much of this relates to Apple's ATT framework, which has severely limited the information that app marketers can collect to target prospective customers.
Jonathan Reich: Much of this relates to apples a T T framework, which has severely limited the information that app marketers can collect to target prospective customers.
Jonathan Reich: Although Apple released Scad network for data to enable growth with improved attribution and tracking capabilities. Its impact will be limited until major platforms like meta successfully embed this into their tech stack in the meantime, we are taking a two pronged approach to stabilizing greer of shops.
Although Apple released SCAD Network 4.0 to enable growth with improved attribution tracking capabilities, its impact will be limited until major platforms like Mehta successfully embed this into their tech stack. In the meantime, we are taking a two-pronged approach to stabilizing guru shots and positioning it for growth.
Jonathan Reich: And positioning it for growth first we are focused on product innovation by recently rolling out battles, a new hybrid casual gameplay feature for users to start competing in fast paced short duration photo competitions that are limited in size battles.
First, we've focused on product innovation by recently rolling out Battles, a new hybrid casual gameplay feature for users to start competing in fast-paced, short-duration photo competitions that are limited.
Battles is now available to 5% of Guru Shastra's global user base.
Battles is now available to 5% of Guru shots as global user base, our product team closely monitors all the relevant kpis to tune and refine the experience and optimize engagement retention and in game economy, we expect to make the feature available to a much larger audience.
Our product team closely monitors all of the relevant KPIs to tune and refine the experience and optimize engagement, retention, and in-game economy.
We expect to make the feature available to a much larger audience over the next several weeks and believe that battles will ultimately assist in making the GuruShots game more accessible and relevant to a broader addressable market. We believe this feature will also avail an advertising supported monetization strategy.
Jonathan Reich: Over the next several weeks and believe the battles will ultimately assist us in making the guru shots game more accessible and relevant to a broader addressable market. We believe this feature will also avail, an advertising supported monetization strategy.
Jonathan Reich: Second we are expanding our user acquisition efforts to deliver rollout positive users. This strategy is an iterative process that benefits from the data overhaul we undertook last year.
Second, we are expanding our user acquisition efforts to deliver ROAS-positive users. This strategy is an iterative process that benefits from the data overhaul we undertook last year.
Beyond the core game, we continue developing AI Art Master, a new hybrid casual game that leverages generative AI in gameplay, where users compete against each other in fun, fast-paced competitions. AI Art Master is currently in soft launch in five countries and can potentially be a fourth core product for us.
Jonathan Reich: Beyond the core game, we continued developing AI art Master, a new hybrid casual game that leverages generative AI and gameplay, where users compete against each other and fun fast paced competitions.
Jonathan Reich: Art Master is currently in soft launch in five countries.
Jonathan Reich: And can potentially be a fourth core product for us.
We are improving the game by analyzing the usage data and targeting a broader rollout over the next several quarters.
Jonathan Reich: We are improving the game by analyzing the usage data and targeting a broader rollout over the next several quarters taken together. We continue to believe that we have never been in a better position to create sustainable long term profitable growth.
Taken together, we continue to believe that we have never been in a better position to create sustainable, long-term, profitable growth.
Given the combination of market opportunity, our current product portfolio
Jonathan Reich: Given the combination of market opportunity our current product portfolio.
and roadmap, our marketing prowess, data capabilities, tech stack, and most importantly, our team.
Jonathan Reich: And road map, our marketing prowess data capabilities Tech stack and most importantly, our team. Furthermore, we are not just talking about AI, we've already integrated it throughout our business, including product technology and marketing.
Furthermore, we are not just talking about AI. We've already integrated it throughout our business, including product, technology, and marketing.
Speaker Change: I wish everyone, a happy holiday season, and I would like to turn the call over to <unk>, who will review our financial results.
I wish everyone a happy holiday season, and I would like to turn the call over to E, who will review our financial results.
Thank you, Jonathan. Now for the Zest Marketplace, defined as the number of unique users that open Zest app during the last 30 days of the period.
Jonathan Reich: Thank you Jonathan.
Now for the Z marketplace.
Speaker Change: Fine as the number of new users that opens as app during the last 30 day of the period.
Decreased 10.7% from a year ago to 28.5 million
Speaker Change: <unk> increased 10, 7% from a year ago to 28 5 million.
Now in well-developed markets and emerging markets, we're down 13.1% and 20% respectively.
Speaker Change: Now in well developed market and emerging market.
Speaker Change: Down 13, 1% and 10% respectively.
Total revenue in the first quarter was $7.1 million, up 3% from last year.
Speaker Change: Total revenue in the first quarter was $71 million up 3% from last year.
Physical goods and services, which encompasses revenue from Gurusha, came in at $0.9 million.
Speaker Change: Digital goods and services, which encompasses revenue from Croatia.
Speaker Change: Came in at zero point $9 million.
Speaker Change: Down 29% from last year.
Speaker Change: Similar to Q4, <unk> revenue was again negatively impacted by Apple's ATT framework.
Similar to Q4, Guru Shastra's revenue was again negatively impacted by Apple's ATT framework.
macroeconomic issues, and the geopolitical situation.
Speaker Change: Macroeconomic issues and the geopolitical situation.
Speaker Change: Subscription revenue for the quarter was up 10% versus last year.
Subscription revenue for the quarter was up 10% versus last year.
Speaker Change: Additionally, this metric was up sequentially for the second straight quarter.
Additionally, this metric was upped sequentially for the second straight quarter.
as our net active subscriber trend improves.
Our net subscriber train improve.
and higher value iOS subscription and our new value added Zest Plus offering for Android replace lower cost legacy subscriptions.
And highest value Io as subscription.
Speaker Change: Our new value added zest plus offering for enjoying.
Speaker Change: Place lower cost legacy subscriptions.
Speaker Change: Which only agree more ads.
Zesprim and GTV grew 35% from last year to $421,000.
Speaker Change: That's premium G. T V grew 35% from last year to $421000.
Reflecting incremental revenue generated some pain.
Speaker Change: Reflecting incremental revenue generated from paint.
which offset must define in other content.
Speaker Change: Which offset modest declines in audio content and see us.
Average revenue per monthly active user or amount was $0.063 up 17% year over year.
Average store I mean per monthly active user or now with 6.3 cents up 17% year over a year.
reflecting stability in ad pricing, and the positive impact of a new iOS and Android support.
Speaker Change: Slapping stability in Ed pricing and the positive impact of our new I O S and enjoys absorptions.
Speaker Change: Cost of revenue declined by 23% and was six 9% of revenue.
Cost of revenue declined by 23% and was 6.9% of revenue.
Speaker Change: SG&A declined by five 6% to $5 5 million.
HGNA declined by 5.6% to 5.5 million.
Speaker Change: GAAP income from operation return into the Black.
Gap income from operation returned into the
increasing by 0.5 million to 0.3 million.
Speaker Change: Increasing by <unk> 5 million to 0.3 million.
Gap then income and EPS for Q1 were near.
Speaker Change: GAAP net income and EPS for Q1 were in the knee.
Versus a net loss and loss per share of 0.1 million and one cent loss
Speaker Change: Versus a net loss and loss per share upon 1 million and one cents last year.
Speaker Change: This quarter.
this quarter, FX, and income tax expense
Speaker Change: <unk> and income tax expense swing negatively impacted GAAP net income.
swing negatively impacted gap in the income by $143,000 and $271,000 respectively versus last year.
Speaker Change: Hundred and $43000 and $271000, respectively versus last year.
Speaker Change: Adjusted EBITDA was $1 $5 million.
Versus $1 million in the prior year.
versus $1 million in the prior year.
From a liquidity standpoint, we remain in a strong cash position with over $18.7 million in cash and cash equivalent.
From a liquidity standpoint, we remain in a strong cash position with all of the $18 $7 million in cash and cash equivalent.
Speaker Change: And only $2 million in Bangalore.
and only $2 million in bank loan at the end of the quarter.
The end of the quarter.
Note that on November 15, after quarter ended, we paid down the $2 million in bank loan and had a remaining cash balance of approximately $16.7 million.
Speaker Change: No debt on the 15.
Speaker Change: After the quarter ended we paid down $2 million in bank loan.
Speaker Change: And had a remaining cash balance of approximately 16.7 million.
Speaker Change: Additionally, please note that we reached an agreement with Peru shots prior owners.
Additionally, please note that we reached an agreement with Guru Shastra's prior owners.
And we would not make any earner payment related to our purchase of a company.
Speaker Change: And we would not make any earn out payment.
Speaker Change: Related to our purchase of the company.
Thank you for listening to our first quarter earning call and I look forward to speaking with you again on the next call in mid-March. Operator, back to you for Q&A.
Speaker Change: Thank you for listening to our first quarter earnings call and I look forward to speaking with you again on our next call in mid March.
Speaker Change: Operator back to you for Q&A.
Speaker Change: We will now begin the question and answer session.
To ask a question, you may press star, then one on your touchtone phone.
Speaker Change: To ask a question you May press Star then one on your Touchtone phone. If you are using a speakerphone. Please pick up your handset before pressing the keys to withdraw your question. Please press star two at this time, we will pause momentarily to assemble our roster.
If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question...
At this time, we will pause momentarily to assemble our roster.
Speaker Change: The first question comes from Allen Klee.
Speaker Change: With Maxim Group. Please proceed.
Now let me warn you.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Alan can you hear us.
He dropped out of the queue. Can you hear me now? We can hear you.
Speaker Change: Sure.
Speaker Change: He dropped out of the queue can you here can you hear me now.
Speaker Change: We can help you out thank you.
Hi, I'm sorry about that. Starting off with, so despite monthly active users declining, you've been executing on everything to really beat my top and bottom line numbers. I wanted to ask a question to start with on monthly active users.
Speaker Change: Hi, I'm sorry about that.
Speaker Change: Starting off with so despite monthly active users declining you're you're executing on everything too.
Speaker Change: Really you don't see my top and bottom line numbers I wanted to ask a question to start with on monthly active users.
Speaker Change: Sure.
Some of that's macro, some of that's industry. Just on that one point, what would you say is what you're working on doing that could potentially start to stabilize that?
Speaker Change: Some of that is macro some of that's the industry.
Speaker Change: Just on that one point what would you say is good.
Speaker Change: What you are working on doing that could potentially start to stabilize that.
Speaker Change: Hi, Alan its Jonathan Thanks, so much for the kind words.
Hi, Alan. It's Jonathan. Thanks so much for the kind words. In terms of
Speaker Change: In terms of May.
now and stabilizing and potentially, you know, even growing that number.
Speaker Change: Mao and stabilizing and potentially.
Speaker Change: Essentially even growing that number.
Literally everything that we have in our.
literally everything that we have in our product roadmap.
Speaker Change: Product roadmap is focused on.
improving that number. And in addition to that, the marketing efforts that we have, both with respect to organic as well as paid marketing initiatives.
In proving that number.
Speaker Change: And in addition to that.
Speaker Change: The marketing efforts that we have both with respect to organic as well as paid marketing initiatives.
are focused on improving that number. So,
Speaker Change: Our focus on.
Speaker Change: Improving that number so.
Speaker Change:
Everything that we have talked about today as well as our future product growth is tied to
Speaker Change: Everything that we've talked about today as well as <unk>.
Speaker Change: Our future product.
Speaker Change: Growth is tied to.
Speaker Change: Improving that monthly active user base.
I just want to point that as well, you know, that we're just slightly below 30 million monthly active users, the number is still a very, very significant number. There aren't that many apps that I'm aware of that have that sort of massive penetration.
Speaker Change: I just wanted to point out as well.
Speaker Change: But we're just slightly over 30 million monthly active users.
Speaker Change: The number is still a very very significant number.
Speaker Change: There arent that many apps.
Speaker Change: Apps that I'm aware of that have.
Speaker Change: That's sort of massive penetration.
Speaker Change: And.
And we are certainly.
We are we are certainly.
shooting to resume growth with that number in the upcoming quarter.
Speaker Change: Shooting to.
Speaker Change: Reserve resume growth with that number in the.
Speaker Change: Upcoming quarters.
Speaker Change: Yeah, I would note that there's some industry researches, saying that after.
Yeah, I would note that some industry research is saying that after smartphone sales being down for around two years, it looks like it may start, sales may start stabilizing and grow next year, which maybe that will help. Just that backdrop also. Yes.
Speaker Change: Our smartphone sales being down for around two years it looks like it may start.
Speaker Change: Sales may start to stabilize and grow next year, which maybe that will help.
Speaker Change: Just just that backdrop also.
Speaker Change: Yes.
Speaker Change: Okay.
So.
Speaker Change: You talk about with Google shots and waiting for with apples.
You talk about with guru shots and waiting with Apple's privacy rules and waiting for the big sites like Facebook to implement what Apple's done. What are you hearing about the timing for that and when that might become effective?
Speaker Change: Uh huh.
Speaker Change: Privacy rules and waiting for the big sites like Facebook to implement.
Speaker Change: Apple has done well.
Speaker Change: Or what are you hearing about the timing for that and when that might become effective.
Speaker Change: We speak.
Speaker Change: Speak to.
Facebook regularly. They, I think, as you know, had rolled out a scan for implementation several months ago, and they had to quickly
Speaker Change: Facebook regularly.
Speaker Change: They are I think as you know had rolled out a scan for implementation.
Speaker Change: Several months ago.
Speaker Change: And they had to quickly.
Roll that back there.
There's no question of a doubt this is a high priority item for them. But really, that question is best geared for the folks over. Now, having said that, we have undertaken several. Initiatives in.
Speaker Change: There is no question of a doubt this is a high priority item for them.
Speaker Change: That question is best geared.
Speaker Change: For the folks over having said that.
Speaker Change: We has undertaken several.
Speaker Change: Initiatives in order to.
assist in scaling our paid user acquisition initiatives, including creative and really massively increasing the number of creatives.
Speaker Change: Assist in <unk>.
Speaker Change: Scaling our paid user acquisition initiatives.
Speaker Change: Including <unk>.
Creative and really massively increasing the number of creatives.
of creative themes and design and so on and so forth, as well as taking advantage of a new
Speaker Change: Creative.
Humans and design and so on and so forth.
Speaker Change: As well as taking advantage of.
Speaker Change: A new.
product that, or product feature, I should say, that Facebook had rolled out, known as AEM, Aggregated Event Management, which is meant to
Speaker Change: Products that are product feature I should say that Facebook had.
Speaker Change: Rolled out known as AE, an aggregated event management measurement, which is.
Meant to improve.
a performance by aggregating data from both the app or mobile space and the web space and
Speaker Change: Performance by <unk>.
Speaker Change: Aggregating data from both.
Speaker Change: The app or mobile space and the web space.
Speaker Change: And.
that we believe is having a positive impact as well in terms of helping us scale. So,
Speaker Change: That we believe is having a positive impact as well in terms of helping us scale.
Speaker Change: So.
Speaker Change: Those two items together, coupled with some internal work that we are.
those two items together coupled with some internal work that we are in the process of undertaking.
Speaker Change: In the process of undertaking.
in conjunction with our data team that is analyzing
Speaker Change: In conjunction with our data team.
Speaker Change: That is analyzing.
Speaker Change: Its funnel events that we.
at funnel events that we believe can be targeted against are all tools that are being used in order to help us get there. But of course, when SCAD4 does come out, we are chomping at the bit to include that in our marketing stack in order to
Speaker Change: We believe can be.
Speaker Change: Targeted against.
Speaker Change: Are all tools that are being used in order to help us get there but.
Speaker Change: But of course, when Scott Ford does come out.
Speaker Change: We are chomping at the bit to <unk>.
Crude that in our marketing stack.
Speaker Change: <unk> two.
Speaker Change: Increase.
whether it be first-hand depositors, users, and the life.
Speaker Change: Whether it be first time depositors users.
Speaker Change: Right.
Speaker Change: Oh. Thank you it sounds like you have good momentum with paint.
Thank you. It sounds like you have good momentum with paint where that's getting rolled out and how...
Speaker Change: Where that's getting rolled out and how are you.
Speaker Change: Well talk a little about kind of how you think about that.
Talk a little about kind of how you how you think about that.
the, um, how that's going to kind of, um, get the adoption rate for that. Thank you.
Speaker Change: The how that's going to kind of get the adoption rate for that thank.
Speaker Change: Thank you.
Sure, so as mentioned in my earlier comments, we've now made paint available on a global basis.
Speaker Change: Sure. So as I mentioned in my earlier comments, we've now made <unk> available on a global basis.
I think a point of differentiation between us and let's say many of the other.
Speaker Change: I think a point of differentiation between us and let's say.
Speaker Change: Many of the other.
Speaker Change: Jan AI apps that are out there is that our.
Gen AI apps that are out there is that are offering does not require a user to have to purchase tokens or subscribe to the service, but rather they can essentially paint through watching rewarded videos.
Speaker Change: Offering does not require a user to <unk>.
After purchase tokens or subscribe to a service, but rather they can.
Speaker Change: Essentially paint through <unk>.
Watching rewarded videos.
Speaker Change: And.
The way that we are approaching this is...
Speaker Change: The way that we are approaching.
Speaker Change: This is <unk>.
through several different means in terms of making sure that it is available and visible to our users.
Speaker Change: Through several different means in terms of making sure that it is available and visible to our users.
Speaker Change: Making sure that we are optimizing.
making sure that we are optimizing our store listing, but at the same point in time maintaining our leadership position in terms of ranking with respect to mobile phone personalization. And also using the benefits of marketing.
Speaker Change: Our store listing.
Speaker Change: But at the same point in time.
Speaker Change: Maintaining our leadership position in terms of ranking with respect to mobile phone personalization.
Speaker Change: And.
Speaker Change: Also using.
Speaker Change: The benefits of marketing automation.
convert users from being consumers into actual creators. Separate apart from all that.
Speaker Change: Two.
Speaker Change: Convert users from being consumers into actual creators.
Speaker Change: Separate and apart from all of that I think in last quarter.
of the first couple of months of 2024 calendar year. And having a standalone fully dedicated app. And having a standalone fully dedicated app.
Speaker Change: Quarters Conference call I mentioned that we are working on a standalone Jan AI App that we hope to release.
Speaker Change: In the first couple of months.
Speaker Change: 'twenty 'twenty four calendar year.
Speaker Change: And having a standalone fully dedicated app.
focused on Gen AI is going to allow for us to market in ways that really free us of any
Speaker Change: Our focus on Jan AI.
Speaker Change: Is going to allow for us to market in ways that are really free ups of any.
Speaker Change: Focus that we have on personalization and rather shift that focus all around.
focus that we have on personalization and rather shift that focus all around generated AI.
Speaker Change: Generative AI.
So that is kind of brief nutshell how we think about this evolving space and we're excited by where this space can eventually lead to. But at the same point in time, proceeding with And very soon. What is idea beyond this chance?
Speaker Change: So that is no.
Speaker Change: <unk> not shell, how we think about.
Speaker Change: This evolving space.
Speaker Change: And we're excited by where this space can eventually lead to.
Speaker Change: But at the same point in time proceeding with.
Speaker Change:
you know, a rational and deliberate.
Speaker Change: A.
Speaker Change: Rational and.
Speaker Change: Deliberate.
growth plan so that we are in better control of our deaths.
Speaker Change: Growth plan, so that we.
Speaker Change: Are in better control of our destiny.
Speaker Change: Okay.
Speaker Change: Excellent.
Excellent. For AI art master, how I went to the Google and Apple stores today, and I know they're not yet available in the US. But, um, how it?
Speaker Change: For AI art Master, how I went too.
Speaker Change: Uh huh.
Speaker Change: Google and Apple stores today, and I know theyre, not yet available and in the U S. But.
Speaker Change: Hello.
when you're launching a new new game how do you what's the marketing strategy to try to get it to you know
Speaker Change: When you're launching a new new game, how do you what what's the marketing strategy.
Speaker Change: Try to get it to you now.
you know, accelerate and ramp up. How are you thinking about the market, how to make that happen? Thanks.
You know accelerating ramp up how how are you thinking about the the marketing how to make that happen.
Speaker Change: Sure. So there are many of the components that go into that but let me tell you. Some of the things that we are currently doing even though the game is your point is correct. There is only a soft launch is available on only five countries. Today. Nonetheless, we've been investing in the AI era Master website.
Sure, so there are many components that go into that. But let me tell you some of the things that we are currently doing, even though the game is, you know, your point is correct, there's only soft launch is available in only five countries today. Nonetheless, we've been investing in the AI art master website. And that website has continued to improve its rankings in...
Speaker Change: And that website has continued to improve its rankings.
Speaker Change: In.
Speaker Change: In terms of search engine optimization.
terms of search engine optimization. And that will assist in terms of driving organic growth when the game is introduced into more countries and eventually rolled out on a global basis. Trevor, in apart from that,
Speaker Change: And that will assist in terms of driving organic growth. When the game is introduced into more countries and eventually rolled out on a global basis.
Separate and apart from that.
Speaker Change: We have been doing some very very light.
paid user acquisition campaigns in the market.
Speaker Change: Paid user acquisition campaigns in the markets.
in which the game is in soft launch. Certainly...
Speaker Change: In which the games in soft launch.
Speaker Change: Certainly.
paid user acquisition will be a significant part of that business. And then I think it's really critical to underscore that we will be marketing that game to our user base. So give or take 30 million monthly active users. And our users are over indexed for engaging with
Speaker Change: Paid user acquisition will be a significant part of that business and then I.
Speaker Change: I think it's really critical to underscore that we will be marketing that game to our user base, so give or take 30 million monthly active users.
Speaker Change: And our users are over indexed or.
Speaker Change: Engaging with.
Casual hybrid casual type of mobile games.
casual hybrid casual type of mobile games. So that's an additional plus.
Speaker Change: So that's an additional plus.
And then there is a whole set of initiatives around app store optimization coming up with the right collaterals in the app store.
Speaker Change: And then there is a whole set of initiatives around app store optimization coming up with the <unk>.
Speaker Change: Collaterals in the App store.
making sure that we are benefiting from the hypergrowth that Gen-A-I is currently.
Speaker Change: Being sure that.
Speaker Change: We are benefiting from.
Speaker Change: The hyper growth that Jan AI is.
Speaker Change: Currently experiencing.
So, taken together.
Speaker Change: So taken together.
Speaker Change: That constitutes a good portion of our thoughts with respect to marketing this new title.
That constitutes a good portion of our thoughts with respect to marketing this new title as we continue to progress with the softwares.
Speaker Change: As we continue to progress with the soft launch.
Speaker Change: Thank you a motive he has been a homerun.
Thank you. A mode of pity has been a home run. I didn't catch everything you said of some of the new features you're looking to roll out. Could you just go over that again? Thank you. Sure. So.
I didn't catch everything you said of some of the new.
It features you're looking to.
Speaker Change: Rollout could could you just go over that again thank you.
Speaker Change: Sure. So we're looking at.
Speaker Change: Let's call it an emotive and emoji.
Let's call it an emoji translator. You can type in a field of text, and you will have that.
Speaker Change: France later, you can type in a field of text and you all have that.
text rendered in a string of emojis. We're looking at adding new content types like emoticon.
Speaker Change: Text.
Speaker Change: Rendered in a string of emojis were looking at adding new content types like emoticons.
We are also in the midst of testing a print on demand. The ability to design. I'm sorry. What was that second? What was that second? I'm not a model. I'm not a model. Yeah. What is that?
Speaker Change: We are also.
Speaker Change: In the midst of testing a print on demand an ability with new design I'm, sorry, what was that.
Speaker Change: What was that second motive.
Speaker Change: Yes.
Speaker Change: Sure.
E-M-O-T-I-C-O-N-S. Here could you-
Emoticons E M O T I C O N S. Yes.
Speaker Change: Could you explain what that is.
It's another form of representation of emojis, if you will. And we think that it's a logical extension of the
Speaker Change: It's another form of of.
Speaker Change: Representation of Emojis, if you if you.
Speaker Change: If you will.
And we're we think that it's a logical extension of the.
of the emoji space. So that is certainly something that we're looking at. But just to give you an example of an emoticon.
Speaker Change: Of the <unk> space.
Speaker Change: So.
Speaker Change: That that is certainly.
Speaker Change: Something that we're looking at but just to give you. An example of an emoticon.
Prior to emojis, if you wanted to end a email or text message with a smile, you would type in a colon and a close parentheses. That is an emoticon.
Prior to emerge as if you wanted to and a email or text message with a smile you would type in a colon and a close parentheses that isn't emoticon.
So thank you for answering the question. But the notion of offering emoticons, and then also offering a match of emoji design where you can actually take two emojis and...
Speaker Change: So to.
Speaker Change: To answer your question, but.
Speaker Change: The notion of offering emerging hot emoticons.
Speaker Change: And then.
Speaker Change: Also offering a mash up of emoji design, where you can actually take two emojis and.
Join them together and you have a new.
Join them together and you have a new visual that
Speaker Change: Visual.
That.
Speaker Change: Is the output associated with that so those are all areas that we're looking at and I would add as well that we're also looking into the notion of offering a subscription tier to the <unk> service that we would.
is the output associated with that. So those are all areas that we're looking at. And I would add as well that we're also looking into the notion of offering a subscription here to the EmojiPedia service that we would want to test. And if that shows good prospects, then we would further develop that.
Speaker Change: I want a test and if that shows good prospects.
Speaker Change: And then we would.
Speaker Change: Further develop that.
That's very helpful. I'll throw in a financial question. I know you're not giving specific guidance, but any commentary on seasonality and maybe any
That's very helpful.
Speaker Change: We're in a financial question.
We're not giving specific guidance, but any commentary on how the seasonality and maybe any any.
Speaker Change: Financial metrics that you're kind of prioritizing.
financial metrics that you're kind of prioritizing.
Speaker Change: Well seasonality as you know our business is heavily weighted towards advertising revenue and.
Well, seasonality is, you know, our business is heavily weighted towards advertising revenue and...
Speaker Change: We are we are in the same boat as any other digital business that is heavily weighted towards advertising space, obviously, our Q2, which expands November December January.
We are in the same boat as any other digital business that is heavily weighted towards advertising space. Obviously, RQ2, which extends November , December , January , is historically our strongest quarter of the year. And there's no reason to believe that will be different this year. And in terms of
Speaker Change: Is historically, our strongest quarter of the year.
Speaker Change: Uh huh.
Speaker Change: There's no reason to believe that will be different this year.
Speaker Change: And in terms of.
Speaker Change: Financial Kpis, we are always looking at.
Financial KPIs, we are always looking at our cash, things like quick ratio and then ARP now, as being really important to...
Speaker Change: Our cash things like quick ratio and then.
Speaker Change: Our MAU as being.
Speaker Change: Really important to us.
Speaker Change: The.
Speaker Change: Theme of <unk>.
theme of being financially solvent and allowing for us to have ample runway to continue to grow the business and seize opportunity as we see that opportunity unfold.
Speaker Change: Being financially solvent and allowing for us to have ample runway to continue to grow the business.
Speaker Change: And sees opportunity as well.
Speaker Change: We see that opportunity unfolding.
Okay.
Speaker Change: That's great.
That's great. So I'm probably going to say this wrong, but the average revenue per monthly active user.
Speaker Change: So I'm, probably going to say this wrong, but the average revenue per monthly active user.
Speaker Change:
Speaker Change: That was up 17% a lot of things go into that subscription definitely helped.
That was up 17%. A lot of things go into that subscription definitely helped.
What do you see like going forward as the key things you're doing that can impact what direction that moves?
Speaker Change: What do you see like going forward is that the key things you're doing that that can impact what direction that moves.
Speaker Change: Okay.
Speaker Change: Yeah. So it's a function of our product and when I say our product that involves our that includes not only our AD stack and how.
Yeah, so it's a function of our product. And when I say our product, that involves or that includes not only our ad stack and.
how we monetize or add inventory, but also our subscription offering. As you've seen, the growth and subscription space has sustained for, I guess, two quarters.
Speaker Change: How we.
Speaker Change: Monetize our AD inventory, but also our subscription offering as <unk> seen.
Speaker Change: The growth in subscription space has a sustained for.
Speaker Change: Two quarters subscriptions, the introduction of subscriptions on iOS.
The introduction of subscriptions on iOS are really exciting. They are to higher price points when compared to Android. So that coupled with the edge mark premium marketplace where we actually go out and allow for artists.
Speaker Change: Our really exciting they are to higher price points when compared to Android.
Speaker Change: So that coupled with the.
Speaker Change: These edge Mark premium marketplace.
Speaker Change: Where we actually go out and.
Allow for artists to sell.
to sell license content and how that is priced and how that is offered to our user base, all of those taken together contribute to influencing that average driving you per monthly active user.
Licensed content.
And how that is priced and how that is offered to our user base all of those taken together.
Speaker Change: Contribute to influencing that average revenue per monthly active user.
Speaker Change: Okay.
Speaker Change: Okay, great. That's it for my questions. Thank you very much congratulations on a strong quarter.
Okay, great, but that's it for my questions. Thank you very much, congratulations on a strong quarter. Thank you.
Speaker Change: Thank you.
We have no further questions in Q. This concludes our question and answer session and conference call. Thank you for attending today's presentation. You may now disconnect.
Speaker Change: We have no further questions in queue. This concludes our question and answer session and conference call. Thank you for attending today's presentation. You may now disconnect.
Speaker Change: Okay.