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spk01: Ladies and gentlemen, thank you for standing by, and welcome to BigCommerce's second quarter 2021 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your first speaker today, Daniel Lentz, Head of Investor Relations. Thank you. Please go ahead.
spk07: Good afternoon and welcome to BigCommerce's second quarter 2021 earnings call. We will be discussing the results announced in our press release issued after today's market close. With me are BigCommerce's President, CEO, and Chairman, Brent Bellum, and CFO, Robert Alvarez. Today's call will contain forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning financial and business trends. our expected future business and financial performance and financial condition, and our guidance for the third quarter of 2021 and the full year, 2021. These statements can be identified by words such as expect, anticipate, intend, plan, believe, seek, will, or similar words. These statements reflect our views as of today only and should not be relied upon as representing our views at any subsequent date, and we do not undertake any duty to update these statements. forward-looking statements by their nature address matters that are subject to risks and uncertainties that could cause actual results to differ materially from expectations. For a discussion of the material risks and other important factors that could affect our actual results, please refer to the risks and other disclosures contained in our filings with the Securities and Exchange Commission. During the call, we will also discuss certain non-GAAP financial measures, which are not prepared in accordance with generally accepted accounting principles. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, as well as how we define these metrics and other metrics, is included in our earnings press release, which has been furnished to the SEC and is also available on our website at investors.bigcommerce.com. With that, let me turn the call over to Brendan.
spk15: Thank you, Daniel, and thanks to everyone for joining us on our second quarter earnings call. On today's call, Robert and I will review our second quarter results, provide you with updates on our strategy, highlight some of our recent product launches and partnership announcements, and also provide additional disclosures on our recent acquisition of Feedonomics. Finally, we will conclude today's call by updating you on our third quarter and 2021 full year guidance. Let's begin with a brief recap of our Q2 financial results. Momentum across our business segments continues to gain speed. We saw strong revenue growth in the second quarter, increasing to $49 million, up 35% year-over-year, and it represents the sixth consecutive quarter of 30% or higher revenue growth. Our partners and teams across all geographies are doing a tremendous job executing on our strategy, so I want to start by thanking them for their continued commitment and all their efforts. The underlying trends in our key metrics also continue to strengthen, starting with ARR, or annual revenue run rate, which grew to $209.3 million, up 38% from a year ago. We continue to see strong momentum in our target market of established and growing businesses. Our enterprise account, ARR, was $122.7 million, which was up 54% year over year. ARR, for accounts greater than $2,000 in annual contract value, or ACV, finished at $177.2 million, up 46% year-over-year. Last week, we announced the acquisition of Feedonomics, a leading data feed optimization platform that is being used by nearly 30% of the top 1,000 Internet retailers. Their technology helps merchants get discovered across leading advertising channels and facilitate sales across both social and marketplace platforms. With U.S. e-commerce ad channel spending expected to more than double to over $40 billion by 2024, the effectiveness of merchant spend on these areas will become increasingly critical. We're seeing the importance of structured data gaining traction amongst our channel partners, merchants, and agencies. Maximizing omnichannel demand generation and sales requires a feed management solution that can ingest, enhance, and syndicate product data across multiple channels. Feedonomics builds on many of the major Omni partnerships we have announced recently, becoming the connective tissue that can make BigCommerce the world's most powerful e-commerce platform for Omni-channel selling. We believe that merchants will need to meet consumers where they are, whether it's on social channels, ad channels, or marketplaces. And together with Feedonomics, we will be the best way for merchants of all sizes to reach and acquire new customers wherever they shop and browse online. The migration away from on-premise software and outdated legacy systems towards our best-of-breed Open SaaS platform is steady, and we believe this trend will pick up speed in the coming years. Additionally, our merchants are looking for ways to streamline their omnichannel operations, juggling complex logistics and marketing efforts to grow their businesses. We aim to be a critical partner to our merchants by serving as the nucleus of their omnichannel growth efforts. We remain steadfast in our commitment to invest in our core platform and be the leading open SaaS platform in the world for merchants of all sizes. Our core strategic areas of focus remain our core open SaaS platform, omnichannel, international expansion, B2B, headless, and expanding our partner and services revenue opportunities. It's clear this acquisition fits well within our core strategic pillars. BigCommerce has demonstrated its ability to drive strong and durable revenue growth rates while generating leverage with a disciplined approach to capital allocations. As I mentioned on our IR call last week, our market continues to get bigger, and there are many opportunities for us to invest in our business, both organically or inorganically, through targeted M&A. We will continue to make smart investments that accelerate our strategic initiatives and deliver outsized value to our merchants and partners over the long term. Now I'll move on to discussing new customers that launched exciting sites on our platform. In Q2, we had several premier brands joining BigCommerce. Well-known fashion brand Peter Christian recently moved from a legacy platform to big commerce to launch two international storefronts that leverage a React custom product bundler. With this, the merchant can combine many products into a single product detail page, creating a better customer experience. Quality Marine, which offers one of the widest and highest quality selections of aquacultured and sustainably caught marine fish and invertebrates, upgraded from a custom-built solution to launch a website on BigCommerce that enables both B2B and B2C functionality. Through its work with BigCommerce and an agency partner, Quality Marine is able to showcase multiple brand sites through a single BigCommerce instance. Industry-leading manufacturer and distributor MainTex migrated to BigCommerce in order to take advantage of bundled B2B functionality, which is available exclusively on our platform. AM Touch Dell Supply also chose BigCommerce for our B2B capabilities and leveraged the recently launched B2B edition to support its complexities around cost tracking, customer groups, and pricing of products. Additionally, the brand needed a platform that could support mobile responsiveness and offered a tight integration with its ERP. RDO Equipment Production, a manufacturing brand with more than 75 stores nationwide, launched the first headless storefront on BigCommerce using SiteFinity as at CMS. The company was drawn to BigCommerce's open source mentality and flexibility and felt that its open APIs allowed them to connect all the pieces of their overall solution together. Parent company, Keraloha, launched its second site on BigCommerce, color-changing product company Delso, after successful launch of its flagship site, Keraloha.com, last quarter. BigCommerce also expanded and added many key partnerships for which we are very excited. In Omnichannel, we announced a partnership agreement with Amazon, launching a native integration with Amazon Multi-Channel Fulfillment, or MCF. This partnership will give U.S. merchants natively built on BigCommerce an easier way to fulfill their e-commerce orders using Amazon's warehousing and order fulfillment platform. Merchants can utilize the service whether they sell on Amazon or not, improving their fulfillment, logistics, and customer experience. Near the beginning of Q3, We announced a partnership with Mercado Libre that will allow BigCommerce merchants to access the largest Latin American marketplace through our channel manager. It will allow merchants to quickly start selling throughout the region, managing for them the complications of currency conversion and language translation. Our partnership with Commonwealth Bank of Australia will provide the bank's business customers the ability to grow their online businesses leveraging BigCommerce's platform and CBA's comprehensive financial services. Leading European payment processor, Checkout.com, expanded its BigCommerce offerings by adding many of the most popular alternative payment methods in Europe, Latin America, and Asia. We agreed to work with OpenNote, our first move into crypto payments. Merchants already on BigCommerce will have the ability to accept Bitcoin payments on-chain and on the Lightning network, as well as the ability to exchange their Bitcoin to their local currency at any time. BigCommerce is partnering with Avisam, to bring dropship products for sellers to launch and scale their e-commerce offerings. Additionally, we signed with Capla, a leading Italian SaaS shipping solution provider that allows merchants to choose their local carrier in Italy and Europe. And finally, we launched an integration with Facebook's conversion API. This enables merchants to send web events directly via APIs, improving the insights that power their Facebook and Instagram advertising campaigns. On the product side, We launched a range of high-value features throughout Q2. We enhanced our offering in continental Europe by launching fully localized stores for merchants in France, Italy, and the Netherlands. For merchants in those countries, the sign-up and store launch experience are now fully localized in terms of languages, currencies, themes, and payments. we launched our new B2B edition, which is already seeing strong traction. The B2B edition packages many of the capabilities most popular among B2B sellers, including corporate account management, invoicing, sales rep quoting and masquerading, managed logins, and shared shopping lists. The service facilitates channel expansion, a combination of B2C and B2B selling on a single platform, and the extension of B2C-like experiences for B2B buyers. Finally, with our data analytics suite, we launched Big Open Data Solutions, a tool that gives merchants extreme flexibility and control in the management of their data. In conjunction with Google BigQuery Data Warehouse, BigCommerce merchants can centralize all data into a single location for analytical insights. The solution works across business intelligence and data platforms. We believe our merchants' data is their data, and we will continue to implement ways for them to leverage that data to manage and grow their businesses better on BigCommerce than on any other platform. Looking to the balance of 2021, we're excited about our prospects for continued merchant acquisition, product enhancements, partnership introductions, and geographic expansion. We believe our open staff strategy is differentiated and valued by businesses globally, and we will continue to make bold bets on the strategic priorities that we've consistently articulated. I will now turn the call over to Robert to talk about our financial results.
spk09: Thanks, Brent, and thanks, everyone, for joining our call today. Today I'll review our second quarter financial results and provide an update to our third quarter and full year 2021 guidance. I'm really proud of our team for another great quarter across all fronts, and we remain confident in delivering our full-year outlook. We're posting strong revenue growth, continued operating leverage, and we are very pleased with what we're seeing in the underlying trends across our KPIs. Q2 was a continuation of the momentum we experienced in Q1. The pace of growth across our platform has been strong across our segments. In Q2, total revenue was $49 million, up 35% year-over-year. Revenue in the U.S. grew by 30%, compared to 54% across our combined international operations, reflecting the progress of our international expansion efforts. EMEA was up 67% in Q2, as we saw continued traction in our UK and continental European businesses across both enterprise and retail plans. APAC was up 47% in Q2, where we experienced a pickup in pipeline and agency engagement across our B2B initiatives. Subscription revenue grew 42% year-over-year, our fourth consecutive quarter of accelerating subscription revenue growth. Enterprise and mid-market growth remained robust as our customer mix continued to shift further towards larger enterprises. Partner and services revenue was up 22% year-over-year, even as we lapped the elevated transaction volume from last year, driven by continued durability in platform transaction volume and improved monetization with our technology partners. As we continue to grow our business, we expect to see additional opportunities to improve our monetization rates as well. Moving to our KPIs, as Brent mentioned, annual revenue run rate, or ARR, grew to $209.3 million, up 38% year-over-year. ARR for accounts with greater than $2,000 in annual contract value, or ACV, grew 46% to $177.2 million. Enterprise account ARR grew 54% year-over-year to $122.7 million in Q2, and enterprise accounts represented 59% of our ARR as of June 30, compared to 53% last year. These results demonstrate that our flexible, open SaaS platform and best-of-breed strategy is resonating with our target market of established and growing businesses in the U.S. and abroad. We're now seeing investments on our platform flowing through to our financial results. Our expansion in the enterprise space is still in the early days in many ways. Over the past year, the new opportunities and partnerships we have formed have given us a solid foothold in a market that was historically dominated by legacy, on-premise e-commerce platforms. We're not only competing, but we're winning large enterprise accounts at a healthy clip across all the geographies we serve. Shifting to the total number of accounts with ACV greater than $2,000, at the end of Q2, we had 10,986 customers over the $2,000 threshold, an increase of approximately 1,600 accounts, or 17% year-over-year. Our go-to-market teams are making steady progress in taking consistent market share within the mid-market and enterprise segments. As of the end of Q2, accounts with ACV greater than $2,000 made up 85% of our total ARR. That's a nearly five-point increase over last year. Now I'll move on to ARPA, or average revenue per account. In general, we think this provides an overview of our customer mix and growth trajectory. ARPA for accounts with ACV greater than $2,000 for Q2 was $16,133, up 25% year-over-year. We saw a strong mix of mid-market and enterprise accounts, coupled with healthy growth in PSR driving this number. Moving on to the remainder of the income statement. Please note that unless otherwise noted, all references to our expenses, operating results, and share count are on a non-GAAP basis. Gross margin edged up by 169 basis points year-over-year to 80%. In Q2, non-GAAP gross profit was $39.4 million, which was an increase of 38% year-over-year. Accelerating growth in our SAS subscription sales and continued strength in PSR revenue drove the improvement in margins. Moving on to sales and marketing expenses, in Q2, we reported $20 million, equaling 41% of total revenue compared to $16.5 million and 45% of revenue a year ago. We have been deliberate in increasing our sales and marketing efforts both in the U.S. and internationally, and we anticipate further investments here to expand our go-to-market efforts and drive further acceleration of revenue growth. The trend of subscription mix remains tilted towards enterprise plans. We're pleased by the strength of our pipeline and the size and quality of leads coming our way through our organic efforts from our inbound marketing and agency and tech partner referrals. In Q2, research and development expenses were 13.2 million, or 27% of revenue, compared to 11 million and 30% a year ago. The enhancements we've made to our channel manager tool and soon the integration of feedonomics are good examples of our ability to integrate cutting-edge tools for both SMB and enterprise merchants. As we see the move towards omnichannel picking up speed and becoming a pillar of merchants' e-commerce strategy, we expect to generate even more operating leverage over time. We're optimistic that the investments we're making will positively impact our financial results in the back half of 2021 and will provide additional momentum into 2022. We are ramping up investment in a number of key areas in our business and are hiring aggressively towards that end. We saw higher than expected operating leverage in Q2, partially as a result of the timing of planned hires, mostly in non-revenue generating roles. We may see some temporarily improved operating leverage in the back half of the year, depending upon progress against our aggressive hiring plans. However, our investment plans remain unchanged. and we are committed to ramping up the resources necessary to fuel our top-line growth and strategic initiatives. For the quarter, general administrative expenses were 10.4 million or 21 percent of revenue compared to 7.3 million or 20 percent of revenue a year ago. In Q2, we posted an adjusted non-GAAP operating loss of negative 4.2 million or a negative 9 percent operating margin compared to a negative 6.2 million or negative 17% operating margin in Q2 2020. Adjusted EBITDA was negative 3.5 million or a negative 7% adjusted EBITDA margin, an eight-point improvement from a negative 15% adjusted EBITDA margin a year ago. This leverage was driven by a combination of strong top-line growth and slight delays in the timing of planned hires as we have increased investments throughout the business. Non-GAAP net loss for Q2 was negative $4.2 million or negative $0.06 per share compared to a net loss of negative $7.3 million or negative $0.38 per share a year ago. We ended Q2 with $203 million in cash, cash equivalents, and marketable securities. For the six months ended June 30, 2021, operating cash flow was negative $17.4 million, essentially flat over the same period a year ago. Free cash flow was negative 19 million or a negative 38% free cash flow margin compared to a negative 18 million and a negative 50% free cash flow margin over the same period a year ago. As we hit our one-year anniversary as a public company, our commitment to enhancing our platform and merchant experience remains our focus. We've demonstrated our steadfast approach to delivering innovative tools, and our conviction in building the best open SaaS platform in the market has never been greater. The feedonomics acquisition accelerates our strategic vision and serves as a complimentary addition to the big commerce offering. We remain committed to moving the business towards profitability in 2022. However, we may adjust our anticipated timeline based on smart strategic and go-to-market investment opportunities that present themselves. We will have more details to share on this in future quarters as we further develop our plans for 2022. Now let's shift to discussing guidance for Q3. and for the full year of 2021. The results in the first half of the year show our ability to deliver consistent growth, the durability of our e-commerce platform, and the strength of our partnerships. We're encouraged by the momentum we're witnessing in our underlying business. We're optimistic going into the second half of 2021, but we will continue to take a moderate approach to consumer spending expectations in the back half of the year as we continue to monitor the impact of the COVID-19 pandemic on e-commerce trends. A meaningful shift in the broader macroeconomic environment and e-commerce spending could cause us to modify our guidance higher or lower, and we will continue to provide our best view of these trends in future earnings calls. For the third quarter of fiscal 2021, we expect total revenue in the range of $54.5 million to $55 million, translating into a year-over-year growth rate of 37% to 38%. This guidance range includes our early estimates of feedonomics' revenue contribution. Without raising any outside capital, the Feedonomics team has built a very impressive business with healthy growth rates similar to BigCommerce, and we expect that business to deliver $11 million or more in revenue for the remainder of the year post-closing. We believe there are strong future revenue strategies between BigCommerce and Feedonomics, so we plan to invest accordingly to continue to grow this business together over the long term. This guidance also includes a negotiated one-time revenue share increase on an existing payments agreement from the inception of the contract to date, which we expect to generate an incremental $1 million in partner and services revenue in Q3. For Q3, our non-GAAP operating loss is expected to be $9.5 to $10.5 million as we ramp up our hiring and make planned investments to fuel the synergies and cross-sell opportunities with Feedonomics. For the full year of 2021, we currently expect total revenue between $210.7 to $211.7 million, translating into a year-over-year growth rate of 38% to 39%. Our non-GAAP operating loss is expected to be between $30.3 million and $32.3 million, which includes our planned near-term investments in feedonomics as well. Given our overperformance here to date, We are able to make these investments and still stay within our prior guidance for the full year. We're committed to long-term growth and profitability, even if that means some tweaking to our near-term plans as opportunities present themselves. Our market continues to get bigger, and the underlying trends in our business continue to get better as we enter our fourth consecutive year of accelerated revenue growth. We think the fundamental backdrop of our e-commerce platform is excellence, and e-commerce trends as a percentage of total retail continue to grow at an accelerated rate. We believe the rapid movement towards e-commerce positions us well to capitalize on opportunities to expand our TAM and extend our reach within the segments of the market we serve best today and in the future. With that, Brett and I are happy to take any of your questions. Operator?
spk01: If you'd like to ask a question at this time, please press the star, then the number one key on your touchtone telephone. To withdraw your question, press the pound key. Our first question comes from Terry Tillman with Truist.
spk05: Hey, everyone. Good afternoon. Congrats on the results in the quarter, the enterprise traction, the partnerships and the international. Brent, I think we could do like a whole analyst day on just partnerships. I mean, that was a lot to have to go through, but it was all good stuff. I guess maybe my first question, Yep. My first question, Brent, for you relates to we've gotten a lot of questions on Amazon and MercadoLibre. You know, how do we think about the timing of the benefit there? Are those revenue share programs? Just can you shed some more light on how this could positively affect the model, aside from just making you more competitive with your open SaaS strategy?
spk15: Hey, Terry. So we don't disclose, obviously, details around specific features, partner agreements and contracts. You know, some will involve rev share, some will not involve rev share. I would say for those two specific opportunities, they're both extremely exciting for us in our ecosystem. In the Amazon case, the new announcement was integration into Amazon's fulfillment system, specifically for merchants doing fulfillment off of Amazon. for example, from their websites. And so that direct integration into Amazon MCF is letting merchants choose to take advantage of what, you know, what is clearly one of the best fulfillment networks in terms of speed and, uh, you know, warehousing capabilities that exist in the United States. That's, that's the new news with Amazon. And then Mercado Libre is exciting because it's a foreshadowing of our excitement and interest in, serving the Latin American region, and in particular, this is now helping to open up sales in Latin America primarily to our customers that are today in North America. But we, of course, have aspirations on serving sites in Latin America, serving Latin American consumers as well. But very exciting news with MercadoLibre.
spk05: Okay. All right. Thanks for that. I guess maybe, Ari, you know, you did mention in your prepared remarks increased monetization on the PSR side. I think you did just also mention a new kind of updated rep share that impacts the third quarter positively by a million. But I would love to hear a little bit more by, you know, kind of what you mean by increased monetization and then how do we think about feedonomics in terms of that $11 million across 3Q and 4Q. Thank you.
spk09: Yeah, Terry, we actually added a slide in the investor presentation on kind of our current views. of our addressable market over time. You know, the previous version really just focused on e-commerce platform spending. Now we've added kind of our views on how we kind of layer in the components, the major components of PSR, Omni being one of them, and obviously Fedonomics is going to help fuel that. And then we also included a view around shipping payments and rev share that we would get from apps. And so, you know, when you look at that view, you can see that it's still early innings in terms of our monetization path, or if you want to look at it like a share of wallet. You know, subscriptions, feedonomics business, I'll have to reemphasize, they just built a a really impressive business. You know, it's a bootstrap company, really healthy growth rates. And when you think about our ability to cross-sell, when you think about our ability to really expand their offering in ways where our merchants can benefit, we're really kind of skating to where the puck is headed, right? When you think about Omnichannel, so much of the demand that's going to be driven in the years to come, we believe, is going to be where consumers are, where they're browsing, and whether that's an ad channel, marketplace, social channel, we need to enable that. We need to empower that. And that's going to drive orders to the platform. And you know our enterprise plans are tiered based on orders, but it's also going to drive rev share for those partners that we get rev share from. So the subscription impact will be order-based. The rev share impact will be captured in PSR. And, you know, I just think that the monetization opportunities in front of us, not just from Omni, but expanded offerings with payments, buy now, pay later, working capital, all of those components are going to play out over time. So that's what I was referring to.
spk01: Our next question comes from Brent Braceland with Piper Sandler.
spk14: Hi, this is Mauro Molina. I'm from Brent. Thanks for taking our questions. So from a competitive standpoint, could you walk us through the importance of being able to support a broad number of social commerce channels? And is this becoming a more important factor that's contributing to your head-to-head win rates against incumbents? And then I just have one follow-up.
spk15: I'll broaden the question beyond just social commerce. channels, but to include everything that feedonomics addresses, which is advertising channels, you know, the biggest ones are search engine marketing channels like Google, Microsoft ads, social channels would, of course, be Facebook, Instagram, Snapchat, affiliate channels, display ads, anytime there's a product feed, going into the actual paid advertisements, They cover that and also marketplace channels, Amazon, eBay, Etsy, Walmart, Wish, et cetera. Collectively, this represents almost 50% of U.S. e-commerce. We shared in the press release around feedonomics that an estimate for 34% of U.S. e-commerce sales are marketplace sellers on marketplaces. And then more than 20% of our own customer sales on their branded websites are from digital advertising as the last click and so you combine those you get to almost 50 percent and what's so compelling and powerful about feedonomics is that it is both the best in our opinion feed management solution out there in terms of getting your data from your branded website or erp or pim into these various channels and enhancing it based on the schema and the criteria by which then your advertising or your listings will perform best, it's also the most broad-based. And so you can start with one channel like Google or one channel like Amazon and expand pretty easily to many others all from a single solution. So consequently, we viewed this as probably the single thing that we could do in the world that would be most effective at helping our customers maximize third-party demand generation and third-party sales, basically buying the best feed management tool in the world and putting that at their disposal. So I think the impact on potential sales for our customers is enormous, and we're really excited to continue to build the feedonomics business both for our customers and all the ones who use it.
spk14: Great. Thank you. And then one last one from us. Have there been any PSR categories this year that have surpassed your expectations so far? And then more broadly, you know, as we see some potential for longer disruption from the pandemic, are there any services that you anticipate will resonate most with customers as they invest in their digital commerce strategy? Thank you.
spk09: Yeah, I'd say payments for sure has exceeded our expectations. Omni, obviously, as we start to see the early traction and volume generated by our channel partners and, again, the orders they're driving for our merchants, those probably would be the top two. You know, over time, As we build out our capabilities, as we've talked about in the past, building our own kind of version of our Apple App Store, we feel like there's a lot of monetization opportunities from the apps in our app marketplace. And then beyond that, I'd say probably shipping would be next in terms of our ability to expand some of our take rate through RevShare from shipping.
spk01: Our next question comes from Josh Beck with KeyBank.
spk04: Thank you for taking the question and all the great context there. I wanted to ask about the cohort chart. So if I look at the last few years, that new cohort size has certainly increased. Certainly last year there were a lot of factors at play. So maybe without getting too specific, Just how do you think about the prospects for larger new cohorts in the years ahead?
spk09: Yeah, hey, JB. Yeah, that's a function of, you know, the size of merchants we've been signing up as well as the PSR revenue that we attach from the larger volumes from them. We've done a great job on the gross retention side as well as on the net revenue retention side. You know, you saw improvements year over year. Last year, those improvements are continuing. So the improvements in NRR are we feel like are becoming more and more durable as we, you know, expand that mix to more enterprise. You know, we've got now 59% of our ARR that's enterprise plans, 85% that's tied to accounts greater than 2K. And as we've talked about a lot, I mean, all those merchants for us have really strong unit economics. And so as those cohorts mature, Those are the cohorts that are going to benefit from a lot of the investments that we're making. You know, when you think about feedonomics, we're doing that so that we can drive orders for our merchants. And they're the ones that, over time, we think are going to really benefit from these investments. And, you know, the NRR picture should, you know, evolve even better as we bring on bigger and bigger merchants.
spk04: Very helpful. And then maybe just a follow-up on the buy now, pay later space. Obviously, that had a very bright light shine upon it this week. So I'm just curious maybe what have the customer interest been in buy now, pay later? And just conceptually, are the economic arrangements similar to other payment partners that you have?
spk15: I'll take that. We're really bullish on the role buy now pay later plays in retail because it creates incremental spending power for consumers that they didn't have from their existing credit card lines or bank balances. And, you know, if you just look back in the history of retail before e commerce, in the days, you know, dominated by The discount stores, the department stores, furniture stores, they all had major private label credit programs that delivered both incremental credit to consumers and incremental marketing offers and incentives to buy, you know, like six months, no interest type stuff. So the internet was slow to introduce its own versions of this. And it wasn't really until Bill Me later around 2008 that it started to be introduced in the US. And in the last five years, there's been an explosion. You know, we announced the partnership with Sezzle, which we're really excited about. We had existing integrations in the US and the PayPal, PayLater, Affirm, Klarna. Klarna is the leader in Europe. Down in Australia, you've got Afterpay and Zip and other ones. As a company who really believes in openness and choice and letting businesses optimize for what suits them best. We believe in integrating with serving all of these methods and negotiating the best partnerships that we can on behalf of our merchants and our ecosystem. So, you know, they'll keep being changed. They'll keep being innovation in this area because when you do deliver incremental credit to consumers, they move forward their purchasing power. and they buy more. That's in the interest of everybody involved.
spk04: Great. Thanks, Brent and R.A. Thanks.
spk01: Our next question comes from Tom Roderick with Stifel.
spk03: Yeah. Hi, Brent. Hi, R.A. Thanks for taking my questions. Great to hear from you guys. Nice job in the quarter. You know, one of the things we've gotten some questions on is just the nature of the fulfillment market and ultimately you know, how that sort of seamlessly winds itself into an omnichannel strategy, of course, e-commerce being part of that. We'd love to hear your take on how, you know, that segment of ultimately the supply chain is evolving, integrating with your offering, and if there's a role for big commerce on the fulfillment side, particularly as you get into more enterprise customers.
spk15: Yeah, I think the most important takeaway is that there's not a one-size-fits-all for businesses. Some companies, you know, have a single warehouse, do everything from it. Some have multiple warehouses, maybe even in multiple geographies. Some may have a mix of first party and third party warehouses. Others want to outsource it entirely to a 3PL or an Amazon mix match. It can be any or all of the above. Again, going back to my last comment, BigCommerce is all about delivering the most flexible, powerful, and open platform in the world that can support any or all of these models and the best players in each area. So as an example, we would never contemplate ourselves trying to get into shipping and fulfillment because it's a very competitive and well-served vertical. It's our goal to go partner with various players. We don't want to have to compete against Amazon, we want our customers to have the choice of using Amazon in addition to all of the other software providers and full service providers that are out there. So where you will see the most innovation at BigCommerce, it's in both the open capabilities that we deliver to various fulfillment models via multi-location APIs, et cetera, and the integration with various partners to give our merchants choice in you know, optimization for their businesses.
spk03: Great answer. Great detail. That's fantastic. Thanks, Brent. All right. You know, I know you've gotten a gazillion questions on the PSR numbers over the last year. And, you know, that's starting to normalize off some pretty tough comps. But I kind of wanted to address it in the context of next, you know, the next quarter. You got a really nice jump in sequential revenue growth and the guidance. Of course, part of that is feedonomics. But maybe you can kind of give some further thoughts so that, you know, I stay on the right side of the model in terms of how to think about, you know, the midterm growth in PSR once we normalize and maybe you can kind of repeat just what some of the moving parts were with a $1 million incremental bump in that number this quarter versus where the feedonomics pieces shake out.
spk09: Yeah, I mean, we went ahead and provided what we're baking in for feedonomics, you know, at $11 million. post-closing to the end of the year. When you think about PSR year-to-date, I would say our GMV levels have remained strong. Our GMV per merchant metrics look really, really good, especially for our key account, you know, the accounts greater than 2K. And so when we think about that in the back half, you know, we're just going to take a similar approach. I mean, things are there's a lot of dynamics changing on a weekly basis when it comes to COVID and the impact that will have on e-commerce. So, We just have to continue to be careful on kind of those estimates around GMV. On the million dollars that we're disclosing for Q3 on the rev share piece, that was a deal we had with a payment partner. We basically overperformed. We negotiated a little bit better rates, as we talked about in the past. As we scale up further, we're going to have more opportunities to improve our basis point rev share from some payment partners. And so that's a kind of one-time adjustment that we expect to book all in Q3.
spk03: Outstanding. Really helpful. Thank you both, and congratulations.
spk09: Thanks, Tom. Appreciate you.
spk01: Our next question comes from Stan Zalotsky with Morgan Stanley.
spk10: Perfect. Thank you so much, guys. So I wanted to kind of follow up on Tom's question. a second ago, just on PSR growth. When you saw the final PSR numbers for the quarter, how did you feel about the PSR numbers that came in in the quarter? Was that in line with your plan, ahead of your plan? And then when you saw the numbers for PSR in Q2, how did you think about the rest of the year for PSR? And I realize it's a very, very tough number to try to figure into your guidance. How did that inform the rest of your PSR for the year?
spk09: Yeah, hey, Stan. I mean, going into Q2, we were kind of thinking subscription revenue would be kind of in the mid-30s. We were pleased that it came out at 42%. For PSR, we were expecting it to kind of be in the mid-teens. That came in in the low 20s, like 22%. And so we definitely beat our expectations on PSR. And when we look at kind of GMB across the board and we look at the rev share opportunities, you know, we feel good about it. We feel confident that, you know, the guidance we set, you know, we're kind of baking that in with potential upside, you know, if we continue to see improvements around GMB and improvements on our ability to monetize, you know, with rev share.
spk10: Got it, got it. And maybe just on feedonomics, a little bit more granularly, I know you mentioned $11 million for the remainder of the year. How much are you expecting for Q3 versus Q4? And just remind me, I believe the deal is already closed, right?
spk09: It was a sign and close. And, you know, we're not going to break out the $11 million Q3 and Q4 deal What we are going to do on our next call, though, is as we kind of dig into the data, we're going to make sure that we can incorporate their data with our KPIs. So further disclosures on phenonomics will come in November when we announce Q3. That will give us the time that we need to make sure we incorporate it the right way across all of our KPIs. Okay, perfect. All right, thank you, guys. Sure. Sure.
spk01: Our next question comes from Raimo Linsha with Barclays.
spk11: Hey, congrats from me as well. Brent, can you talk a little bit about what you see in terms of pipeline building on the larger accounts And then as part of the answer, maybe there's been quite a few new partnerships that helped you there. Does that have an impact already to kind of highlight the open nature of BigCommerce versus what others are having? Does that kind of start to fill that through already? And then I had one follow-up.
spk15: Hey, Rambo. Mid-market and enterprise pipeline is very healthy for us. We have internal targets for where we want to see that be an aggregate relative to our gross new goals, and we feel like we're in a very good place right now to be able to hit that. You can't always predict when individual deals close, and you're sort of presuming a consistency around win rate and close rate on deals. But all the trends that we're seeing are quite healthy, and it's a nice pickup from let's call it the Q2 a year ago when some of the bigger deals were at least temporarily paused at the beginning of the pandemic. And it was it was the retail plans that were flying off the shelves. So in general, it's very good. And in terms of the of the partnerships, and what they do for pipeline, at the enterprise level, the biggest driver there are not technology partnerships, you know, the ones that tend to get a press release that are their agency partnerships and agency partnerships. It's not a single big bang date of integration, and suddenly they start producing an agency decides to work with us, they build a practice, they start selling or co selling new opportunities. And we're really excited to see some of the, you know, market leading global leading digital agencies, consulting firms, building practices around us and really betting that we're a big part of the future of e commerce.
spk11: Okay, perfect. Thanks. That's very clear. And then, Rob, you know, you're slightly different than other technology companies given, like, in general anyway, but also given the location. As we think about, like, scaling like the organization, you know, post-COVID, spending more and investing into growth again. Can you just remind us about the different factors we should be aware around, fields of marketing and R&D as well, when we think about scaling the OPEX line? Thank you.
spk09: Sure. I mean, you know, our R&D teams are pretty dispersed. I mean, we've got a strong R&D team in Austin, in San Francisco. We've got a team in Sydney. as well as our team in Kiev, which continue to do a great job for us. As we think about sales and marketing, you know, a lot of our enterprise sales, we've got to make sure we've got coverage across different territories in the U.S. as well as international. When I think about us as well as a lot of tech companies right now, you know, there are roles where we have to be flexible. There are specialized roles across sales and marketing that we have to recruit them where they are. And so I think for us, we've done a really good job of making sure that we manage our sales capacity. We feel really good about sales productivity, sales capacity. The revenue generating roles look great across sales and business development. In terms of engineering and some of our other operational roles, those are the ones that we have to really continue to put the pedal to the metal on recruiting. We're really excited about our strategic initiatives. Again, we talk a lot about Omni. We talk a lot about B2B, Headless, International. We're making great strides on international expansion. We want to invest heavily there. And so those are the areas that we're going to continue to invest in to support that and oftentimes accelerate that.
spk11: Yeah, exactly. Yeah, it makes sense. Okay, thank you.
spk01: Our next question comes from Samad Samana with Jefferies.
spk12: Hi, good evening. Thanks for taking my questions, Seth. Robert, maybe a couple for you to start. If I take out the contribution from feedonomics and the beat in the second quarter, it basically implies that the second half guidance was basically the same in dollar terms as when you gave the full year outlook at 1Q. So I just wanted to check if there was a change in the guidance philosophy. Typically, you guys have kind of raised the core business's guidance after each quarter I'm just curious if there's a change in the way you guys are thinking about guidance or why maybe it was held, let's call it, flattish, excluding the acquisition.
spk09: Yeah, hey, Samad. You know, we did take it up slightly for the back half, excluding feedonomics. We look at our subscriptions. We feel great about that subscription growth. You know, that's being balanced out by... you know, the modest expectations that we're baking in for PSR. Again, it's really tied to GMB, but we did take it up for the core business slightly for the back half versus our prior guide.
spk12: Understood. And then maybe just switching gears, on the subscription MRR in the quarter, right, if we basically take out the trailing 12-month PSR revenue, that growth, do you thought it just modestly, I mean, it's still solidly in the 30s, but I I'm trying to understand because typically that subscription MRR is tracked with subscription revenue growth and your subscription revenue growth accelerated nicely and improved nicely quarter over quarter, but just that MRR decelerated. So was there anything at the end of the quarter on MRR that, or is it just a one-time dynamic? Just trying to reconcile those two different moves.
spk09: So I want to make sure I understand your question. Are you backing out 12 months of PSR and looking at subscription ARR versus the prior quarter? Is that what you're looking at? Correct.
spk12: Yeah, yeah, decelerated slightly from the 1Q growth rate to the 2Q growth rate. So I was just curious because subscription revenue kept accelerating.
spk09: Well, so if you look at our ARR for Q2 compared to last year, remember our promo stores last year we did not record revenue, but we did capture them in our ARR Q2 last year, right? And so if you're looking at year-over-years for ARR, you really kind of have to factor that in. So when you kind of remove the impact of the promo stores from last year you're probably looking at around a 3% impact to revenue. And on the ARR side, if you were to factor that in, our ARR would have been roughly 42% versus the 38% that we're reporting. Understood.
spk12: Sorry for all the math questions. Thanks for helping me out with that. Brent, maybe zooming out and just thinking more broadly about You know, demand in e-commerce remains strong, and we see that in your overall net customer ads. Just maybe can you help us understand if there's any change in who you're either taking customers away from or if there's more, call it net new, where it's not necessarily replacements. Any change in the market environment of the source of customers?
spk15: Well, a year ago this time, at the start of the pandemic, there was a mad rush. by the flat footed to get online, and a relative shift to new sites, and even new e commerce merchants, relative to migration. And I would say, you know, now that things have stabilized, lots of companies that are still stuck on legacy platforms are looking to get on, you know, one of the modern leaders of which were at the forefront, and just a couple others. So it's, you know, still it's a large mix. And although I can say the platform that has the most contributing migrations is Magento, even ahead of Magento are custom builds and custom platforms at the enterprise level. And then there's everybody else is kind of trailing Magento, but they all add up to a far bigger number than Magento itself. So it's a very diverse mix. more than 500 platforms around the world, B2C and B2B. Most of them are old, declining, underfunded, and will just keep contributing opportunities to us in the years ahead. And that's in addition, of course, to all the new businesses, new brands, new sites, new geographies that customers will spin up sites for.
spk12: Great, thank you both for taking my questions.
spk01: Thanks. Our next question comes from DJ Hines with Canaccord.
spk17: Hey guys, thanks and congrats on the quarter. Brent, can you just talk about what's going on in EMEA? I mean, the growth numbers are off the charts there. Are deal sizes materially different? Is referenceability starting to help? Just what's going on particularly in that market?
spk15: Yeah, EMEA, especially Europe, is rocking and rolling. and has been really ever since about month six of our entry into the UK, however many years ago that was, maybe three years ago. But the big news there is that the strength of our business has expanded from primarily the UK and Ireland, now into the continent as well. And we're super excited about the announcement on July 1st, the full-fledged launch for us into France, Italy, and the Netherlands, is both a special announcement for product and for people. On the product side, we're now able to not just fully market and sell to and sign up a merchant in the local languages, but also provision them with teams and a full implementation onboarding flow with emails and other defaults into their local languages. Really great templating capabilities. for them to then customize the email templates and the language in them, et cetera. So it's an end-to-end localized experience. Of course, we'll now look to expand that into other geographies to come down the road. And we're seeing nice traction. Netherlands is doing really well for us. We're picking up deals in France and Italy. Another dynamic that we're seeing that we think is really healthy in the early days of our entry into Europe Even though we had – when we opened our office in the U.K., we already had maybe 3,000, 4,000, 5,000 stores in Europe. All self-serve sign-ups are primarily that. But with the launch of our operations, we kind of went in mid-market and enterprise first, and that was the primary strength of our business up until this year. And now we're really starting to see small business plans, especially pro, which is the upper end of the small business plan, selling extremely well in Europe. And we like that. We like to see that healthy strength and small mid-market and enterprise, not just one or the other.
spk17: Yeah, perfect. That's helpful. And then all right, as a follow-up and sorry to ask about PSR growth again, but I just want to make sure I understand what you're saying. When you talk about improved monetization of transaction volume, which I think you said in the prepared remarks, are you saying that PSR revenue is growing faster than GMB on the platform?
spk09: Slightly, yeah. I mean, we're – again, as we scale up, we're going to get better rev share agreements from our payments partners. And as we continue to focus around non-payment-related PSR, we expect that to have an impact on us. Like, if you think about Omni – Again, it's where that puck is headed. It may not impact significantly in the back half, but we feel very strongly that over time a lot of orders, a lot of GMV is going to be driven that way. As we referenced earlier, you can see the pace of partnerships that we're launching. All of these new partnerships, the vast majority of them, are going to impact our PSR line significantly. and as we get bigger and bigger, we're going to get better and better rev share from them. So a lot of that's kind of starting to take hold. Yeah, makes sense. Okay, thank you, guys.
spk01: Our next question comes from Scott Berg with Needham.
spk16: Hey, guys, this is John. I'm for Scott. I appreciate you taking my question. Just curious, you know, with enterprise cycles starting to rebound, As you look at some of your more recently released features, is there anything that kind of sticks out from a competitive standpoint that's driving the most differentiation as to why customers are choosing BigCommerce?
spk15: Yeah. In the last quarter, the one that we're extraordinarily proud of is open big data. What we have done in terms of provisioning our pro and enterprise customers with their own dedicated Google BigQuery databases that they can add to append, you name it, and then connect on top of that any of the leading business intelligence tools, personalization tools, customer segmentation tools, we think it's market leading, it's extremely powerful. And it's one of those things that will influence some decision cycles for businesses and picking a platform, but really has an outside impact once a business gets live and realizes just how empowered they are to use their data and use it both for analyzing their business and also for powering their storefront. So that is super powerful and we're really excited about it. The other thing that continues to be very much market leading is our B2B capabilities. So the launch of the B2B edition is now BigCommerce is selling a package with sort of built-in functionality that makes us a full-featured B2B platform because it combines all of the native capabilities of BigCommerce with a half dozen of the most popular and impactful B2B functionalities. That's flying off the shelves. I mean, we are so excited about the interest and traction we're seeing both in sales to date and pipeline that is building an interest for us as a B2B platform. And we had already earned some really great reviews last year from various agencies like Paradigm, like Forrester and IDC who are rating us as a B2B platform. Wait till you see the new ones that are coming out. factoring that in there, I think it'll be great for us. And then the final area that I emphasize for enterprise functionality, where we're very differentiated is in headless, we have capabilities and headless that are really only matched by the purpose built microservice companies that can only do headless. We are now sort of in a in a closed beta, where our multi store for headless capabilities are being integrated into various live merchant sites and front-end content management systems and frameworks. And so headless capabilities with now multi-store for headless coming out is sort of a third area that very much differentiates us and is helping us to win large enterprise opportunities.
spk16: Awesome. Thank you very much, guys.
spk01: Thanks. Our next question comes from Brian Peterson with Raymond James.
spk02: Hi, gentlemen. Thanks for taking the question, and congrats on a strong quarter. So first on B2B, Brian, I know you just hit on some of this, but any hope on sizing the opportunity there? How big is a percentage of the pipeline? Has that become a revenue? Are there any stats that you can share there? And what are you displacing when you pick up some new B2B customers?
spk15: Yeah, in terms of market opportunity, we keep referencing back to Forrester's estimates. And I think IDC might have had something similar a few years ago, that total global e-commerce platform spend, meaning what companies spend on their platform technology. It's about a third B2B and about two thirds B2C. So it's a really giant part of the global market and it was growing faster. than B2C. It was actually gaining share because B2B companies in general have been slower to adopt fully e-commerce than B2C. For our own business, I think historically we've generally said it looks like, you know, in the neighborhood of 20% of our enterprise sales have been B2B specific or hybrid B2B, B2C, but with an emphasis on B2B. And I would say without having new numbers that I would disclose or even at the top of my head, since the launch of the B2B edition, B2B has increased as a percentage just because they have a lot of traction in B2C.
spk02: Oh, sorry, Brian. I didn't mean to cut you off. Go ahead.
spk15: No, I was going to finish there. So, you know, it's only gone up since we've launched that, and we're still early days. Okay. The awareness of B2B addition spreads, and, you know, we're eager to see the research analysts and the technology research analysts do their updated platform evaluations for B2B factoring this in.
spk02: Got it. Good to hear. And, RA, maybe any help on the third quarter outlook? I think Typically, you've kind of given us some help on the subs, Outlook versus PSR, any color you can share on that. Thanks, guys.
spk09: Yeah, I mean, we won't disclose specifics, Brian, but I'd say continued strength in subscription for sure. You know, again, the pipe looks really good for mid-market and enterprise deals. And then, you know, we're going to kind of back things off a little bit. It's probably on the PSR side, but continued strength in subscriptions.
spk16: Thank you.
spk01: Our next question comes from Matt Pfau with William Blair.
spk13: Hey, guys. Thanks for taking my questions. A quick follow-up on the revenue split. Does that feedonomics revenue flow into the subscription line? Maybe I missed that.
spk09: Yeah, pretty much all will flow into subscription of that 11. Okay.
spk13: Got it. And then just wanted to follow up on earlier this year, you announced an integration with Square for point of sale. And, you know, as you think about omni-channel commerce, obviously bridging that online-offline experience is pretty important. What have you seen in terms of traction there with the point of sale with Square or any other providers interested in integrating on that side?
spk15: Yeah, I mean, Square has been a partner for, geez, probably three, four years. The new integration that we announced earlier this year and released is very nicely upgraded for their latest APIs and capabilities. You know, we think merchant satisfaction success with it is better than ever. I don't know how many hundreds, but it's hundreds of merchants you probably do built with to find out are using both Square and BigCommerce. So it's a very nice installed base They're one of, you know, multiple POS platforms that we work with. Others include PayPal, Zettle, EposNow, Venn, first date is Clover, the high end of the market, Teamwork, Heartland Retail. We've got quite a few and we're eager to add more because as an open platform, we don't compete in point of sale. you know, the way a couple of our competitors do. We instead invest our resources in being the best partner to the market-leading point of sales. And so merchants who are on one and running their retail operations with it, when they want to go to the best platform in the world in terms of integration and capability that can work in conjunction with their POS, that's what we want to be for the individual merchants and for the platforms they use.
spk13: Great. That's it from me, guys. Appreciate it.
spk01: Our next question comes from Ken Wong with Guggenheim Securities.
spk06: Great. Thanks for taking my question. I'll keep it to just one. When we think about the feedonomics business going forward, you mentioned growth is similar to big commerce. Should we think of that as something that could accelerate with synergies, or when we think about the revenue benefit, it's going to be more of an indirect revenue generator in that obviously it's going to boost GMV for a lot of merchants, and then you'll drive revenue via PSR, kind of above and beyond the kind of the old 19 million run rate. What's the right way to think about kind of how that business gets worked in and the impact on top line?
spk09: Brett, you want me to take this one?
spk15: I'll do it and then you add to it, R.A., if that's all right. So I think the single biggest driver is going to be referrals and recommendations of the commerce customer's to feedonomics, ones who aren't using it today, which is the vast majority of our customers. Number two is as they start using feedonomics and then their website sales go up, then through advertising effectiveness, through demand generation, that increases their order counts and their GMV and leads to adjustments in plans accordingly. A third area of benefit, which is the hardest to quantify, will be new sales that we win in the market when a company is making an evaluation across e-commerce platforms and values the half of all e-commerce, as I mentioned earlier, that either occurs on marketplaces or is generated from paid advertising back to a branded site. And they say, I want to be really powerful and effective at maximizing those various streams of sales. So I'm going to go with big commerce rather than a competitor who doesn't have anything equivalent to seedonomics. You know, you can't disaggregate individual decisions down to a single factor like that, but we certainly expect it to lead to incremental new merchant wins and sales for us going forward. And then the final one, which is probably the smallest, I talked about cross-sell of big commerce merchants over to feedonomics. There will be some going the other way. Most likely, you know, the best candidates will be the merchants that they serve on outdated custom platforms that were built in-house. And, you know, in those cases, we'd love introductions anytime a merchant on a custom platform is considering a replatform to a modern SaaS option.
spk09: Yeah, I mean, the only thing I'd add to that is, you know, when you combine what Fedonomics is great at with what BigCommerce is great at, that combination, we believe, is very powerful for our merchants. And a lot of those synergies are going to play out and are not factored into, you know, the number that we're providing today, but we'll be providing more details on those synergies as we work closely with Fedonomics across all those fronts that Brent just mentioned, but couldn't be more excited about the synergies and the cross-sell opportunities between the two companies. And, you know, ultimately we think it's going to be a very big differentiator for us in the market. You know, if you're a merchant, whether you're SMB, mid-market, or enterprise, you really want to make sure that your products can be found across all those channels in the right way and convert the right way. And I think the combined businesses between us and Feedonomics is going to deliver that in ways where other platforms can't. So I think plenty of upside. And look, they were able to grow their business really nicely without us, and we think combined we're going to be able to grow the business even more together.
spk06: Thank you for the really thoughtful response. I'll pass the mic.
spk01: Our next question comes from Drew Foster with Citigroup.
spk08: Hey, thanks. I'll keep it to one as well. Brent, can we circle back on the comments you made about the Google BigQuery offering for your customers? I'm sure I'm missing a key detail here, so I'm hoping you can help me out. But why would an integration into a third party database provide more competitive differentiation for you on the enterprise stage, just given, you know, what's likely a higher degree of in-house expertise and resources, et cetera. Like why are those types of relationships moving the needle for you and competitive enterprise deals? Thanks.
spk15: Well, because that Google BigQuery database comes basically out of the box. It's not a referral. It's not a, you know, It's not a third party relationship. It's something that we're, this is where we're managing the data for our customers and to have access to a database that then they can append data to. And there's already, and in essence, it's free for pro and enterprise merchants. It doesn't cost them a penny as part of our offering. They can then, on top of that, seamlessly utilize all of the free or paid, as I mentioned, business intelligence, tools, personalization tools, customer segmentation tools that are pre-integrated with BigQuery. It's an extremely powerful offering. I mean, our competitors, maybe they dump the data into a database and you have to have SQL skills, and then you've got to append a whole bunch of things on top of it. You know, that's not easy. What we're offering our customers is easy, powerful, out of the box, and free.
spk08: Thanks a lot.
spk01: That concludes our question and answer session. I'd like to turn the call back to Brent Bellum for closing remarks.
spk15: All right. Well, thanks, everybody, especially those of you who have followed us for the full first year of our public company existence. We know this is year one under our belts. We hope that, you know, as an analyst or an investor who's been following us, we have lived up to and exceeded the expectations that we've set. We couldn't be more excited about the next 10 years ahead because they lay the foundation for the 10 years and more beyond that. And with continued focus execution and great partnering with our ecosystem and customers, we hope to be really the most innovative and successful e-commerce platform in the world in the years to come. So looking forward to the next call. Be well until then. Thanks.
spk01: This concludes today's conference call. Thank you for participating. You may now disconnect.
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