Q1 2024 Phunware Inc Earnings Call
Good afternoon, ladies and gentlemen, welcome to fund, whereas first quarter 2024 Investor Conference call.
Operator: Good afternoon, ladies and gentlemen. Welcome to Phunware's first quarter 2024 investor conference call. Currently, all participants are in listen-only mode.
Operator: Currently all participants are in a listen only mode. Joining me today are Mike Snavely, Chief Executive Officer, and Troy at rest Ryzen, our Chief Financial Officer. The format. Today will include prepared remarks by Mike and Troy, followed by a question and answer session.
Operator: Joining me today are Mike Snavely, Chief Executive Officer, and Troy Reisner, Chief Financial Officer. The format today will include prepared remarks by Mike and Troy, followed by a question and answer session. As a reminder, today's discussion will include forward-looking statements. These forward-looking statements reflect our current views as of today and are based on various assumptions that are subject to risks and uncertainties disclosed in the risk factors section of our SEC filings. Actual results may differ materially, and undue reliance should not be placed on them.
Operator: As a reminder, today's discussion will include forward looking statements. These forward looking statements reflect current views as of today and are based on various assumptions that are subject to risks and uncertainties disclosed in the risk factors section of our SEC filings.
Operator: Actual results may differ materially and undue reliance should not be placed on them.
Operator: Additionally, the matters being discussed today may include non-GAAP financial measures reconciliation of GAAP to non-GAAP financial information is set forth in the earnings press release, which is available on the Investor Relations section of <unk> website at investors Dot <unk> Dot com.
Operator: Further I further encourage you to visit investors Doc fund, where the dot com to access not only the earnings press release, but also our SEC filings and additional collateral unfunded.
Operator: Additionally, the matters being discussed today may include non-GAAP financial measures. Reconciliation of GAAP to non-GAAP financial information is set forth in the earnings press release, which is available on the Investor Relations section of Phunware's website at investors.phunware.com. I further encourage you to visit investors.phunware.com to access not only the earnings press release but also SEC filings and additional collateral on Phunware. At this time, I would like to turn things over to Phunware's CEO, Mike Snavely. Please proceed.
Michael Snavely: At this time I would like to turn things over to fund, whereas CEO Mike slightly. Please proceed.
Michael Snavely: Fellow shareholders welcome I'm happy to tell you that we're off to a strong start in 2024 and that our plan to focus on the fundamentals of our SaaS businesses work.
Michael Snavely: Fellow shareholders, welcome. I'm happy to tell you that we're off to a strong start in 2024 and that our plan to focus on the fundamentals of our SaaS business is working. The first quarter of 2024 is the first evidence of sales traction for quite a while. New logos and bookings are up. Our solutions continue to gain traction with customers across the hospitality and healthcare sectors by delivering strong ROI. As a result, we continue to both renew and extend our existing customer relationships and win new business in competitive situations in hospitality and healthcare.
Michael Snavely: The first quarter of 2024 is the first evidence of sales traction for quite a while.
Michael Snavely: New logos and bookings are up.
Michael Snavely: Our solutions continue to gain traction with customers across the hospitality and health care sectors by delivering strong ROI.
Michael Snavely: As a result, we continue to both renew and extend our existing customer relationships and win new business in competitive situations in hospitality and healthcare.
Michael Snavely: In fact in the first quarter, we've seen more than 60% of the total bookings we did in all of 2023.
Michael Snavely: In fact, in the first quarter, we've seen more than 60% of the total bookings we did in all of 2023. Costs are down. We previously announced expense cuts that took full effect in the first quarter. Our gross margin has dramatically improved as a result, and Troy will brief you on those details. On the patent monetization front, we have executed a term sheet to engage a partner to work on our behalf in monetizing additional patent families. Now, I'll ask our CFO, Troy Reisner, to rise.
Troy Lee Reisner: Costs are down we previously announced expense cuts that took full effect in the first quarter.
Troy Lee Reisner: Our gross margin has dramatically improved as a result, and Fred will brief you on those details.
Troy Lee Reisner: On the patent monetization front, we have executed a term sheet to engage a partner to work on our behalf and monetizing additional patent sandwich.
Troy Lee Reisner: Now I'll ask our CFO, Troy ryzen or to run through the details of first quarter results Brian.
Troy Lee Reisner: Thanks, Mike and good afternoon, everyone I'd.
Troy Lee Reisner: Thanks, Mike, and good afternoon, everyone. I'd like to thank you all for joining us today for a review of our first quarter of 2024 financial performance. I'll be discussing GAAP financial measures unless otherwise specifically noted. Our press release, 8K, and website provide a reconciliation of all GAAP to non-GAAP financial results. In addition, a quick reminder, we shut down Light Technologies in 2023, and the business was reflected as a discontinued operation. Prior quarterly information has been updated to reflect this. With that said, let's take a look at the numbers.
Troy Lee Reisner: For the first quarter of 2024, net revenues were approximately $921,000, which exceeded our internal plan by 5%. While Phunware continues to not provide detailed earnings guidance, we do believe it is helpful to our investors and others to share that our internal net revenue goal for 2024 is between the range of $6 and $8 million, which will be backloaded into the second half of the year. Gross profit was $524,000 for Q1 2024 versus $73,000 for Q1 2023, which resulted in gross margin of 56.9% and 5.4%, respectively for the quarter. Adjusted gross margin was 61.8% compared to 23.4% for the respective quarter.
Troy Lee Reisner: I'd like to thank you all for joining us today for a review of our first quarter of 2020 or financial performance.
Troy Lee Reisner: While the 2023 margins were impacted by the timing or recognition of certain product costs, 2024 also benefited from improvements in streamlining our product delivery processes and a significant decrease in stock-based compensation. Total operating expense was approximately $3.4 million in Q1 2024 versus approximately $6.8 million in Q1 2023, or a 49.8% fee treatment. Other non-cash operating expense items for the quarter were stock-based compensation and depreciation, making up a combined $600,000 for Q1 2024 compared to $1.1 million in Q1 2023.
Troy Lee Reisner: I'll be discussing GAAP financial measures unless otherwise specifically noted our press release 8-K and website provide a reconciliation of all GAAP to non-GAAP financial results.
Troy Lee Reisner: In addition, a quick reminder, we shut down like technologies in 2023, and the business is reflected as a discontinued operation. Prior quarterly information has been updated to reflect such with that said, let's take a look at the numbers for.
Troy Lee Reisner: For the first quarter of 2024 net revenues were approximately 921, which exceeded our internal plan by 5%.
Troy Lee Reisner: Well somewhere continuous does not provide detailed earnings guidance, we do believe that helpful to our investors and others to share that our internal net revenue goal for 2024 is between the range of $6 million to $8 million, which will be back end loaded to the second half of the year.
Troy Lee Reisner: Gross profit was 524000 for Q1 2024 versus 73000 for Q1, 2023, which resulted in gross margin at 56, 9% and five 4% respectively for the quarters.
Troy Lee Reisner: Adjusted gross margin was 61, 8% compared to 23, 4% for the respective quarters.
Troy Lee Reisner: While the 2023 margins were impacted by the timing of recognition of certain product costs.
Troy Lee Reisner: 24 also benefited from improvements in streamlining our product delivery processes and a significant decrease in stock based compensation.
Troy Lee Reisner: Total operating expense was approximately $3 4 million for Q1 2024 versus approximately $6 8 million for Q1, 2023 or 49, 8% decrease either.
Troy Lee Reisner: Other noncash operating expense items for the quarter were stock based compensation and depreciation and making up a combined 600000 for Q1 2024 compared to $1 1 million in Q1 2023.
Troy Lee Reisner: By excluding these noncash charges adjusted operating expense was approximately $2 8 million in Q1 24 as compared to approximately $5 7 million in Q1 'twenty three.
Troy Lee Reisner: By excluding these non-cash charges, adjusted operating expense was approximately $2.8 million in Q1'24, as compared to approximately $5.7 million in Q1'23. The notable decrease in operating expenses reflects our disciplined approach to managing costs and our ability to execute as a much leaner organization.
Troy Lee Reisner: The notable decrease in operating expenses reflects our disciplined approach to managing costs and our ability to execute at a much leaner organization.
Troy Lee Reisner: On our last call, I said we would begin making investments in the business, and during Q2, we have started to strategically make investments by prudently expanding our sales and marketing teams, which we believe will directly contribute to achieving our net revenue plan for 2024. The non-GAAP adjusted EBITDA loss was $2 million in the first quarter of 2024 compared to a loss of $5.2 million in the first quarter of 2023, or a 61.1% reduction in the loss.
Troy Lee Reisner: On our last call I said, we will begin making investments in the business and during Q2, we have started to strategically make investments by prudently expanding our sales and marketing teams, which we believe will directly contribute to achieving our net revenue plan for 2024.
Troy Lee Reisner: non-GAAP adjusted EBITDA loss was $2 million in the first quarter of <unk> 24, compared to a loss of $5 2 million in the first quarter of 'twenty three.
Troy Lee Reisner: 61, 1% reduction in the loss.
Troy Lee Reisner: Our net loss for the first quarter of 2024 was approximately $2.3 million, or $0.33 per share, compared to a net loss of approximately $4.3 million, or $2.07 per share, for the first quarter of 2023. The weighted average shares used to calculate earnings per share were approximately $6.9 million versus approximately $2.1 million, which reflects the reverse stock split effectuated in February.
Troy Lee Reisner: Our net loss for the first quarter of 2024 was approximately $2 3 million or <unk> 33 per share compared to a net loss of approximately $4 3 million or $2 seven per share for the first quarter of 2023.
Troy Lee Reisner: The weighted average shares used to calculate earnings per share was approximately $6 9 million versus approximately $2 1 million, which reflects the reverse stock split if actuated in February.
Troy Lee Reisner: Moving to the balance sheet, we closed the fourth quarter was approximately $21 6 million in cash zero debt.
Troy Lee Reisner: Moving to the balance sheet, we closed the fourth quarter with approximately $21.6 million in cash, zero debt, and several outstanding legal matters. We were able to achieve this balance sheet transformation through proceeds from the sale of equity and strategic decision making. We believe our financial strength positions us well to not only strategically invest in the growth of our software business but also to have the optionality to pursue M&A opportunities to accelerate growth.
Troy Lee Reisner: Settled the long outstanding legal matter.
Troy Lee Reisner: We were able to achieve this balance sheet transformation through proceeds from the sale of equity and strategic decision making.
Troy Lee Reisner: We believe our financial strength positions us well for not only strategically invest in the growth of our software business, but to also have optionality to pursue M&A opportunities to accelerate growth.
Troy Lee Reisner: And finally during the quarter. We attended the 36th annual Roth Conference and we plan to attend the high Tech 2024 industry conference in late June.
Troy Lee Reisner: And finally, during the quarter, we attended the 36th Annual Roth Conference, and we plan to attend the HITECH 2024 Industry Conference in late June. We expect to remain active at both financial conferences and investor meetings in our efforts to tell our story and further strengthen our corporate profile in the capital market. And with that, I will turn the call back over to Mike for closing remarks.
Troy Lee Reisner: We expect to remain active with both financial conferences and investor meetings, and our efforts to tell our story and further strengthen our corporate profile and the capital markets.
Troy Lee Reisner: With that I will turn the call back over to Mike for closing remarks, Mike.
Mike: Thank you Troy.
Michael Snavely: We appreciate the patience and continued support from our shareholders as we continue to turn the company around. We're off to a great start in 24 hours, and we're looking forward to continuing to deliver for you. I'd like to open up the call now for questions through the operator. Operator, please go ahead.
Troy Lee Reisner: We appreciate the patience and continued support from our shareholders as we continue to turn the company around.
Michael Snavely: We're off to a great start in 'twenty, four and we're looking forward to continuing to deliver for you.
Michael Snavely: I'd like to open up the call now for questions through the operator.
Speaker Change: Operator, Please go ahead.
Speaker Change: Thank you at this time, we will be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad.
Operator: Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the start key.
Operator: A confirmation tone will indicate your line is in the question queue. You May Press Star two if you would like to remove your question from the queue.
Operator: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again. Please press star one if you have a question at this time, please hold while we poll for questions.
Operator: Once again, please press star 1 if you have a question at this time, and please hold while we poll for questions. And the first question today is coming from Darren Aftahi from Roth MKM. Darren, your line is live.
Darren Paul Aftahi: On the first question today is coming from Darren <unk> from Roth and can Darrin Your line is live.
Dylan: Hey, this is Dylan on behalf of Darren. Thanks for taking my questions. First, I wanted to start with the comment you made about your bookings in Q1, roughly 60% this year compared to all of last year. I guess, could you talk, it's a bit of a two-part question, how much of that is from existing sort of expansions and renewals? I know you've announced a few renewals recently versus net new logo
Operator: Hey, this is Dylan on for Darren Thanks for taking my questions first.
Dylan: I wanted to start with the comment you made about your bookings in Q1 roughly 60%.
Dylan: Sure compared to all of last year, I guess could you talk about it's a bit of a two part question.
Dylan: How much of that is from existing sort of expansion and renewals I know you've announced a few renewals recently.
Dylan: Versus net new logos.
Dylan: Sure. This is Mike thanks for the question.
Michael Snavely: Sure, this is Mike. Thanks for the question. It's very roughly 50-50 between the renewal of existing business and then brand new logo wins. We have new logo wins from major hospitality brands, a significant one from an independent, and, you know, certainly the renewal of some of our tentpole customers who've been with us for some time.
Michael Snavely: It's very roughly 50 50 between the renewal of existing business and then brand new logo wins, we have new logo wins for a major hospitality brands.
Michael Snavely: Significant one from an independent.
Michael Snavely: And certainly the renewal of some of our tent pole customers who've been with us for some time.
Speaker Change: Got it thank you and I mean sort of what.
Michael Snavely: And I mean, sort of, what is the timeline you think for turning on some of those customers from sort of when you go from bookings to actual revenue generation? Sure, our implementation time.
Michael Snavely: What is the timeline you think are turning on some of those customers from sort of when you go from bookings to actual revenue generation.
Michael Snavely: Sure, our implementation time frame is roughly 30 days.
Michael Snavely: Sure our implementation timeframe is roughly 30 days.
Speaker Change: Got it and then if I could maybe maybe ask two more first.
Michael Snavely: Got it. And then, if I could maybe ask two more questions? First, on the monetization of the patents. Do you have any color you could provide on sort of what that might look like, what sort of opportunities you're going after, and then maybe when you'd be able to sort of go out to the market to sort of express sort of what you're working on and when it might be able to roll out, whether that's with existing products or net new products?
Michael Snavely: On the monetization of the patents.
Michael Snavely: You have any color you could provide on sort of what that might look like what sort of opportunities.
Michael Snavely: Opportunities you're going after and then maybe when you'd be able to sort of.
Michael Snavely: Go out to the market to sort of express or what you're working on them and win win them it might be able to rollout, whether that's with existing products or net new products.
Michael Snavely: Sure enough. So it's public, of course that we sold the Netflix, I'm sorry, the video streaming patents that were found to be infringed by Netflix to a similar company that helps us to monetize those patents. That work is kind of winding through the appeals process. After we get a final judgment against Netflix, the monetization process will happen there. We don't expect that to happen until, quite frankly, the end of this calendar year.
Speaker Change: Sure so.
Michael Snavely: It's public of course that we sold to Netflix I'm sorry. The video stream patents that were found to be infringed by Netflix to a similar company that helps us.
Michael Snavely: To monetize those patents.
Michael Snavely: That work is kind of winding through the appeals process. After we get a final judgment against Netflix the monetization process will happen. There, we don't expect that to happen until quite frankly, the end of this calendar year.
Michael Snavely: With respect to additional patent families that we're entering into at a similar arrangement with.
Michael Snavely: Now, with respect to additional patent families that we're entering into a similar arrangement with, we expect to likely file specimen lawsuits against folks whom we believe are infringing and then quickly follow that with a letter writing campaign that will help others understand that we're serious about representing our IP rights on behalf of our shareholders. I can't give you right now when we expect those dollars to start coming in, but certainly, as material development should occur, we will update the market.
Michael Snavely: We.
Michael Snavely: Expect to.
Michael Snavely: Likely file specimen law suits against our folks, whom we believe are infringing and then quickly follow that.
Michael Snavely: With.
Michael Snavely: A letter writing campaign that will help others understand that we're serious about representing our IP rights on behalf of our shareholders I can't give you right now when we expect.
Michael Snavely: Those dollars to start coming in.
Michael Snavely: But certainly as material development should occur we will we will update the market.
Troy Lee Reisner: Thank you. And last one, maybe first for Troy, I appreciate the color on sort of what you think the year can look like in the back end specifically. Any color you could provide on sort of the shape of margins in the mid-50s, whether we're in Q1, or is there some investment that has to take place that may push those down on the gross margin side?
Speaker Change: Thank you and last one maybe for Chris Troy I appreciate the color on sort of what you think the year can look like in the back end specifically.
Troy Lee Reisner: Any color you could provide on sorry, the shape of margins.
Troy: In the mid fifties, where they were in Q1 or is there some investment that has to take place then they push those down on the gross margin side at least.
Speaker Change: Thanks for the question.
Troy Lee Reisner: Thanks for the question. I think the margins are going to continue to be in the range that we saw in Q1. You know, a given quarter's margin might ebb and flow in terms of timing of revenue, cost recognition, and things like that. But in a similar vein as what you're seeing in Q1, this is what we would expect for the balance of the year.
Troy Lee Reisner: The margins are going to continue to be in the range that we saw in Q1.
Troy Lee Reisner: Okay.
Troy Lee Reisner: It's a given quarter's margin might ebb and flow in terms of.
Troy Lee Reisner: Oh, you mean, a revenue cost recognition and things like that but.
Troy Lee Reisner: In the in a similar vein as to why you are seeing in Q1 is what were you expect for the balance of the year.
Speaker Change: Great. Thanks for taking my questions I'll pass it on.
Dylan: Perfect. Thanks for taking my questions. I'll pass them on.
Dylan: Thank you. The next question is coming from Scott Buck from H C. Wainwright Scott Your line is live.
Operator: Thank you. The next question is coming from Scott Buck from H.C. Wainwright. Scott, your line is live.
Scott Christian Buck: Hey, good afternoon, guys. Thanks for taking my questions. First, I saw you made a hire on the hospitality side. I was hoping you could give a little color on the hire and maybe some of the additional investments you may be making.
Scott Christian Buck: Good afternoon, guys. Thanks for taking my questions first I saw you made a hire on the hospitality side I was hoping you could give a little color on the higher end.
Scott Christian Buck: Maybe some of the additional investments you may be making.
Speaker Change: And that vertical continue.
Michael Snavely: You bet it's Mike. And we've actually got two hires that I'll talk about, one of which literally started today. So hire number one, which we did a press release on, I guess, about a week ago, is a fellow called Paul Ruffino. Paul's a 35-year-old, or rather, 35-year-old hospitality operator, having run luxury properties and then run some of the operations of major property operating companies. Paul is going to give us access to not only the thought processes and decision makers in some of those kinds of organizations but is also going to help us understand how we can continue to evolve our product to meet the needs of the general manager at the luxury resort, which is very much in the bullseye of our sales target. Number two, we hired a fellow by the name of Donny Newfus. Donny just started today, as I mentioned.
Mike: You bet its Mike.
Scott Christian Buck: We've actually got two hires that I'll talk about.
Michael Snavely: One of which literally started today.
Michael Snavely: A higher number one which we did a press release on it gets about a weeks ago as a fellow called Paul Ruffino holds a 35 year old 35 year, rather hospitality, operator, having run luxury.
Michael Snavely: Properties and then.
Michael Snavely: Run some of the operations of major property operating companies.
Michael Snavely: Paul is going to give us access to not only the thought processes and decision makers in some of those kinds of organizations, but is also going to help us understand how we can continue to evolve our product to meet the needs of the general manager at the luxury resort, which is very much in the bullseye.
Michael Snavely: Our sales target.
Michael Snavely: Number two we hired a fellow by the name of dummy New first Donnie just started today as I mentioned Dani has 25 years of experience in hospitality related events and we believe there is an application for our technology platform to support.
Michael Snavely: Donny has 25 years of experience in hospitality-related events, and we believe there's an application for our technology platform to support the in-event experience for convention attendees. But we've historically been more focused on what I characterize as the leisure traveler. Now, this gives us an opportunity to access a market for the business traveler, specifically those that are attending conventions at major luxury properties around the globe. We're delighted that both gentlemen have joined us.
Michael Snavely: The event experience for convention attendees. So we've historically been more focused on what I would characterize as the leisure traveler now this gives us an opportunity to access the market for the business traveler.
Michael Snavely: Specifically, rather those that are attending conventions at major luxury properties around the globe.
Michael Snavely: We're delighted to both gentlemen have joined us.
Speaker Change: Great. That's helpful and just as a bit of a follow up I mean, whats a reasonable timeline for investors to expect to see some tangible progress in the vertical.
Michael Snavely: Great, that's helpful. And as a bit of a follow-up, what's a reasonable timeline for investors to expect to see, you know, some tangible progress in the vertical?
Speaker Change: Well I think we've seen it in the first quarter and let me tell you why so when I mentioned.
Michael Snavely: Well, I think we've seen that in the first quarter, and let me tell you why. So, when I mentioned in the main part of the remarks that we've done 60% of total 23 bookings already this year, that means that we've had a pretty good head start in terms of selling new contract value, and part of that is existing relationships renewing, but a significant part of that is new logo acquisition. In fact, you know, we're pretty pleased with our bookings performance in the first quarter, and the bookings performance will continue to increase on plan as we achieve it each quarter of the year.
Michael Snavely: In the main part of the remarks that we've done 60% of total.
Michael Snavely: 23 bookings already this year that means that we've got a pretty good head start.
Michael Snavely: In terms of selling new contract value and part of that's existing relationships renewing but a significant part of those new logo acquisition in fact.
Michael Snavely: We're pretty pleased with our bookings performance in the first quarter.
Michael Snavely: And the bookings performance will continue to increase on plan.
Michael Snavely: EBIT.
Michael Snavely: Each quarter of the year.
Michael Snavely: And with our implementation time frame being approximately 30 days, we expect the bookings that we've won in the first quarter to all materially contribute to revenues for the second quarter, and the bookings for this quarter will contribute a third of the rest. So that's the response there.
Michael Snavely: And with our implementation timeframe being approximately 30 days, we expect those the bookings that we won in the first quarter.
Michael Snavely: I'll do all materially contributed to revenues for the second quarter.
Michael Snavely: The bookings for this quarter will contribute through the rest of it.
Michael Snavely: So that's.
Michael Snavely: That's a response there.
Speaker Change: Great. That's helpful. Thanks, a lot guys eliminated.
Scott Christian Buck: Great, that's helpful. Thanks a lot, guys.
Scott Christian Buck: Thank you. The next question is coming from Howard Halpern from <unk> Brothers Howard Your line is life.
Operator: Thank you. The next question is coming from Howard Halpern from Taglik Brothers. Howard, your line is live. Oh, I'm glad.
Howard Allen Halpern: Congratulations on the start to the year. In the press release and the supplemental information, how should we look at... As you grow revenues, the breakdown between subscription and services and application transactions going forward, especially with a lot of the action occurring in the second half of the year.
Howard Allen Halpern: Congratulations on the start to the year.
Howard Allen Halpern: Yeah.
Howard Allen Halpern: In the press release and the supplemental information how should we look at.
Howard Allen Halpern: As you grow revenues the breakdown between subscription and services and application transaction going forward, especially with a lot of.
Howard Allen Halpern: The accident occurring in the second half of the year.
Howard Allen Halpern: Sure, It's Mike again, Doug, let me speak to an hour.
Michael Snavely: Sure, it's Mike again, and let me speak for an hour. So we're focusing very much on our SaaS. And so that's, you know, one to three-year contracts for a, you know, software license fee. We do have an application transactions business, which is reoccurring but not necessarily recurring from the standpoint of renewal revenue. That's going to be largely the same, with probably a slight increase in 24 over 23, but we're very much focused on growth in the SaaS business. When I think about services, and that's really just work for hire services or one-time project work, that will be a very trivial amount of our revenues moving forward.
Michael Snavely: So we are focusing very much on our SaaS business and so that's.
Michael Snavely: One to three year contracts for a software license fee.
Michael Snavely: We do have a application transactions business, which is reoccurring not necessarily recurring from the standpoint of a renewal revenue.
Michael Snavely: That's going to be largely the same with probably a slight increase.
Michael Snavely: In 24 over 'twenty, three but we're very much focused on growth in the SaaS.
Michael Snavely: Business when I think about services and that's really just worked for higher services or one time project.
Michael Snavely: Work that will be a very trivial amount of our revenues moving forward.
Speaker Change: Oh, okay. Okay.
Howard Allen Halpern: Okay. Okay. Thanks for that. Thank you. Keep up the good work.
Howard Allen Halpern: Thanks for that thank you keep up the good work.
Speaker Change: Thank you Sir.
Operator: Thank you, and the next question is coming from Ed Woo from Ascendian Capital. Ed, your line is live. Yeah, congrats.
Howard Allen Halpern: Thank you and the next question is coming from Ed Woo from <unk> capital Ed Your line is live.
Edward Moon Woo: Yeah, congratulations on the quarter. My question is about the competitive environment. Have you seen any change in competition, and how do you think the sales cycle is gonna go throughout this year? Thank you.
Edward Moon Woo: Yes, congratulations on the quarter. My question is on the competitive environment have you seen any change in competition and how do you think the sales cycle is going to go throughout this year. Thank you.
Michael Snavely: Thanks, Ed. I mean, the competitors are generally who they've generally been. There are a number of what I characterize as small app companies that are building, you know, wayfinding and other kinds of apps for hospitality. Most of those are very small companies, and, you know, we're not seeing any difference in who they are or, you know, in their win rates against us.
Speaker Change: Thanks, Ed.
Michael Snavely: I mean, the competitors are.
Michael Snavely: They've generally been I mean, there are a number of what I characterize as small app companies that are building.
Michael Snavely: Finding and other kinds of apps for hospitality most.
Michael Snavely: Most of those are very small companies.
Michael Snavely: And.
Michael Snavely: We're not seeing any difference in who they are or.
Michael Snavely: In there and our win rates against us.
Michael Snavely: We're kind of seeing the same old same old story now what we're finding is that our ability to start to access multiple properties and portfolios of properties is increasing so by engaging at the operator level.
Michael Snavely: We're kind of seeing the same old, same old story. Now, what we're finding is that our ability to start to access multiple properties and portfolios of properties is increasing. So, by engaging at the operator level, where they may have, you know, a handful to dozens of properties, we're able to go in and tell a more interesting, nuanced, and compelling story about generating a delightful guest experience across the entire portfolio. That is something that we're not seeing a lot of the same competitors doing. I'll leave it at that. We hope to have some additional material announcements on that particular prong of O'Garda Market Strategy in the next quarter or two.
Michael Snavely: Where they may have.
Michael Snavely: The handful of dozens of properties.
Michael Snavely: We're able to go in and tell a more interesting.
Michael Snavely: Nuanced and compelling story about generating.
Michael Snavely: Slide four guest experience across the entire portfolio and that is something that we're not seeing a lot of the same competitors doing.
Michael Snavely: And I'll leave it at that and we hope to have.
Michael Snavely: Some additional material announcements on that particular prong of Borgwarner yogurt market strategy.
Michael Snavely: In the next quarter or two.
Speaker Change: Great well congratulations on the progress and I wish you guys. Good luck. Thank you.
Edward Moon Woo: Great. Well, congratulations on the progress, and I wish you guys good luck. Thank you.
Speaker Change: Thank you Sir.
Speaker Change: Thank you and there were no other questions in queue at this time and this does conclude today's conference you may disconnect. Your lines at this time and thank you for your participation.
Operator: Thank you. There were no other questions in queue at this time, and this does conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.