Brilliant Earth Group, Inc.

today and thank you for standing by. Welcome to the Brilliant Earth First Quarter 2025 earnings conference 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. To ask a question during the session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded. I would now like to turn the conference over to Colin Borland. You may now begin.

Welcome to the Brilliant

Earth First Quarter 2025 earnings conference call. My name is Colin Borland, Vice President of Strategy, Business Development, and Invest Relations. Joining me today are Beth Gerstein, our Chief Executive Officer, and Jeff Quo, our Chief Financial Officer. During the call today, management will make certain forward-looking statements within the Meeting of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to our SEC filings for a description of the risks that could cause our actual performance and results to differ materially from those expressed or implied in these forward-looking statements. These forward-looking statements reflect our opinion only as of the date of this call, and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events unless required by law. Also, during this call, management will refer to certain non-GAAP financial measures, a reconciliation of Brilliant Earth's non-GAAP measures to the comparable GAAP measures is available in today's earnings release, which can be found on the Brilliant Earth Investor Relations website. I'll now turn the call over to Beth.

Good morning, everyone, and thank you for joining us today. I'm pleased to share that we delivered another quarter of solid performance within our guidance, marking our 15th consecutive quarter of profitability as a public company. For the first quarter, we delivered net sales of $93.9 million, which was within our stated guidance range and represented a .5% decline year over year. We saw encouraging trends in our business with total orders growing 12% year over year and repeat orders growing 13% year over year, as our premium brand, seamless omnipanel experience, and differentiated product offerings continue to resonate with both new and existing customers. I'm proud to report that we achieved an adjusted EBITDA of $1.1 million in Q1, representing a 1% adjusted EBITDA margin and within our stated guidance range. Our consistent ability to maintain profitability across varying market conditions underscores the strength of our business model and our disciplined approach to managing expenses. Now, let me share some highlights across the business. Starting with engagement rates, we are encouraged to see booking and unit performance improve sequentially over the past few quarters, and in Q1, we saw positive year over year unit growth. Additionally, we saw another quarter of comparatively strong growth in engagement rings priced under $5,000. Our signature engagement ring collection continues to contribute meaningfully, with another quarter of year over year bookings growth outpacing our total engagement ring collection by double digits, and we are delighted that customers are increasingly drawn to us for our premium -a-kind products. And our wedding and anniversary band business is strong, driving year over year bookings growth with outside success in men's wedding bands as well as women's eternity bands. In fine jewelry, we're making substantial progress on our strategic expansion. As a reminder, our assortment of fine jewelry includes items like earrings, necklaces, bracelets, and fashion rings. Fine jewelry bookings represented 14% of total bookings in Q1, an approximate 350 basis point expansion over Q1 last year. We again saw strong double-digit fine jewelry bookings growth in Q1, far outpacing the industry. Fine jewelry remains one of our key areas of investment and growth drivers for the business, as it allows us to introduce new customers to the Brilliant Earth brand, as well as provide additional purchase opportunities for our repeat customers, whether it's a gift for themselves or others. As we've mentioned before, industry sales overall are a majority fine jewelry, so there is significant headroom for us to expand here. We are pleased with the performance we're seeing so far and remain optimistic about the path ahead. Valentine's Day was particularly successful for us this year. We executed an omni-tranal Valentine's Day activation focused on authenticity and connection with our Diamonds on the Menu campaign, resulting in our strongest Valentine's Day period ever. We had our biggest two weeks leading up to Valentine's Day ever, with total bookings up mid to high single digits year-rear. A major contributor to this growth was our exceptional performance in fine jewelry, with bookings growing over 40% -over-year in the two-week lead-up period to Valentine's Day. Consumers came to us for everything from our diamond essentials to our on-trend and seasonal collections like our heart and signature collections, and of course, our top-selling Jane Goodall collection. Overall, it is gratifying to see that we are increasingly consumers' go-to jeweler for special occasions. We're delighted to continue to be the brand of choice for many established celebrities, influencers, and emerging content creators. This quarter, we were excited to work with Brooke Highland and Kalani Hilliker to create their custom engagement rings, which show remarkable social engagement, generating 6.2 million impressions and strengthening our brand presence and bridal leadership. On the showroom front, we opened our second Dallas Fort Worth location in South Lake, Texas in February, which is already showing promising results. We're on track to open one to two more new showrooms this year, which will include our latest design elements, including enhanced try-on bars with increased fine jewelry capacity. To that point, I'm excited to announce our next location will be Alpharetta, Georgia, which will expand our reach in the greater Atlanta area and is slated to open in the next few weeks. Looking ahead, in Q2 so far, we are continuing to see increased momentum from previous quarters across total and repeat orders and throughout the assortment, including continued positive growth and engagement ring units. As it relates to tariffs, we are monitoring the evolving situation closely. We feel confident that our geographically diversified supplier base and strong supplier relationships, limited direct exposure to China, our price optimization engine, and agile data-driven team give us a competitive advantage over the industry to navigate changes in any environment. The anticipated impact of tariffs is included in our outlook for the year, which Jeff will walk you through in more detail. I would like to thank the entire Brilliant Earth team for their dedication and amazing contribution to these results. Now, I'll hand it over to Jeff, who will walk through the financials in detail and discuss our outlook for the coming quarter and year.

Thanks, Beth, and good morning, everyone. As Beth mentioned, we're pleased to report a quarter where we continue to successfully drive our strategic initiatives, innovate, and meet our top line and profitability expectations. Let me take you through the details for Q1. Q1 net sales were $93.9 million within our guidance range, down .5% year over year, and representing a sequential improvement over Q4 2024 -over-year performance. Total orders grew 12% -over-year, and repeat orders grew 13% -over-year in the first quarter, demonstrating the effectiveness of our customer acquisition and retention efforts and the resonance of our brand and products with consumers. Average order value for AOV was $2062 in Q1. This represents a decline of .2% -over-year in Q1 as we continue to deliver a comparatively strong performance in bridal price ranges below $5,000, where we are seeing some of the strongest consumer demand, and as we continue to broaden and diversify our overall assortment, including in our fine jewelry collection. Q1 gross margin was .6% within our medium-term gross margin target in the high 50s and a 130 basis point decline over Q1 last year. The -over-year change in gross margin was primarily driven by higher gold costs and labor and occupancy spend related to our fulfillment and distribution center, partially offset by continued optimization of our pricing engine, procurement efficiencies, and other efforts to manage our gross margin to target levels. We delivered Q1 adjusted EBITDA of $1.1 million or a .1% adjusted EBITDA margin within our guidance range. As Beth mentioned, this marks our 15th consecutive quarter of profitability and is driven by our strong gross margin, combined with diligent data-driven management of our marketing spend and other operating expenses. Q1 operating expense was .4% of net sales compared to .0% of net sales in Q1 2024, as we continue to balance making investments to drive long-term growth with discipline in expense management. Q1 adjusted operating expense was .6% of net sales compared to .7% in Q1 2024. Adjusted operating expense does not include items such as equity-based compensation, depreciation and amortization, showroom pre-opening expenses, and other non-recurring expenses. Q1 marketing expense was .5% of net sales compared to .7% of net sales in Q1 2024. This represents an approximately 80 basis points of -over-year D leverage compared to Q1 2024. Our marketing spend in Q1 was better than our expectations as we continue to be disciplined in driving efficiency. We continue to expect to drive -over-year leverage for the full year 2025 as per our medium-term outlook. Employee costs as a percentage of net sales were higher in the first quarter by approximately 100 basis points as adjusted -over-year. This includes growth in showroom employees, including from newly opened showrooms, as we continue to strategically focus on our showroom expansion. Other G&A as a percentage of net sales increased -over-year by approximately 120 basis points as adjusted for the quarter as we continue to prudently invest in our business. This includes continued investments in technology, showroom rent, and expenses. Our data-driven capital efficient and inventory light operating model continues to provide competitive advantages as our inventory turns continue to be significantly higher than the industry average. Our -over-year inventory grew by .4% even with our significant growth in fine jewelry and a larger showroom footprint. Our lower risk agile inventory model and strong balance sheet continue to differentiate us from the rest of the industry. We ended the first quarter with approximately $147 million in cash, which was about flat -over-year even after reductions in debt principal balance, expansion of our showroom footprint, and investments in technology and operating expenses to drive expansion and efficiency across the business. In addition, we ended the period with a strong net cash position of approximately $92.5 million, a -over-year increase of approximately $4 million. Our ability to generate net cash further differentiates us from many others in the industry and highlights the benefits of our asset data-driven business model. Our financial strength allows us to continue to make prudent investments in the business to drive long-term growth. In Q1, we spent approximately $163,000 repurchasing our common stock. This takes our total spend on stock repurchases to date to approximately $801,000 as of the end of Q1. Our continued intention is to use this program strategically while balancing our overall investment decisions, including consideration of factors such as trading volume and our public flow. Turning to our outlook for Q2 and 2025, as mentioned in our last call, we expect to continue making investments with a compelling ROI that sets the stage for both near and long-term sustainable, profitable growth in the context of a dynamic macro environment. For the quarter, we expect net sales to be between minus 3% to flat -over-year, which is a sequential improvement in -over-year growth compared to Q1. We expect adjusted EBITDA to be between minus $1.5 and plus $2 million. While we have been able to move nimbly to optimize pricing and our procurement strategy, we do expect a limited impact on our Q2 gross margin from higher gold costs and tariffs, assuming that tariff rates and metal prices remain unchanged from current levels. For the year, we are reiterating our net sales guidance of 1% to 3% growth -over-year. We continue to expect that revenue growth will be back half-weighted with a -to-high single-digit -over-year growth rate in the second half driven by improvements in engagement rings, the growth and annualization of our showrooms, a more favorable comp from Q3 2024, and strong fine jewelry performance, particularly in Q4, which is a seasonally important fine jewelry quarter. We are also reiterating our adjusted EBITDA margin guidance in the range of approximately 3% to 4%. For gross margin, as previously mentioned, we expect a limited impact from gold prices and tariffs in Q2. Over the balance of the year, assuming that tariff rates and metal prices are same as they are today, we expect to be able to further mitigate their impact through our pricing and procurement strategy, allowing us to maintain a similar gross margin outlook for H2 as our prior expectations. We've also been successful in managing marketing spend to better than expected levels for Q1 and expect to drive incremental efficiencies in H2 above our prior expectations. As I mentioned during our last call, we will continue to make medium and longer term investments in 2025, including in employee costs and other G&A. Given our progressive sequential revenue growth and that we don't expect to have significant seasonal incremental employee and other G&A costs, we expect the bulk of our adjusted EBITDA will come from H2, with about two-thirds of that coming in Q4. I would also like to highlight two points regarding our debt facility as we continue to evaluate the capital structure and terms that are most effective for our business. We are planning to prepay $20 million of our term loan in Q2, which will leave approximately $35 million of outstanding debt principle under the facility and will result in net interest expense savings of approximately $0.6 million on an annual run rate basis at today's interest rates. We are also working with our lenders to amend certain covenants in our debt facility, including to waive the testing of our SCCR covenant and to add a liquidity covenant through Q1 2026. Given our strong cash position, these moves increase our capital flexibility for investments that may arise in upcoming quarters. As we look ahead, we believe that by leveraging our data-first mindset, prudently managing expenses, and maintaining our capital-efficient model, we will be able to nimbly navigate market changes better than the industry while managing towards a profitable year. The results we've achieved this quarter demonstrate our ability to execute and capitalize on opportunities that create enduring doubt. With that, I will turn the call over to the operator for questions.

Thank you. As a reminder, if you would like to ask a question, please press star 1 1 on your telephone. You'll hear the automated message your hand is raised. If you would like to remove yourself, please press star 1 1 again. We also ask that you wait for your name and company to be announced before announcing your question. As well, limit yourself for one question and one follow-up one moment while we compile the Q&A roster. Our first question will be coming from the line of Ashley Owens of KeyBank Capital Markets. Your line is open.

Hi, good morning. First to start, could you just elaborate on some of the dynamics going on within the Q&A and the engagement that you're observing? I know you mentioned units were up, but is this a trend you've seen continue thus far into Q2? Or is there any macro impact that could be pressuring a customer or any other dynamics into the quarter that you'd feel comfortable sharing right now?

Hi, Ashley. Thanks for the question. We were really encouraged by the positive unit growth that we saw in Q1, and we are continuing to see that in Q2 as well. We talked about this multi-year normalization, but we were really encouraged by the fact that the brand and the product are resonating, that the signature collection is resonating on the engagement ring side, and that the consumer is coming to us as a bridal leader. So feeling encouraged about that in terms of what we're seeing so far to date in Q2.

Okay, great. And then maybe as well, anything you can talk about with the phasing of revenue between 3Q and 4Q? And it sounds like there's a few comps there that we should be mindful of, but just anything you can say there. And then additionally, I know Terv talked about a little bit there, Jeff, but could you maybe elaborate on your sourcing exposure and any impacts we're seeing? Jeff, I think it may be helpful discussing how your protocol possibly differentiates you from the competition in terms of some of those Terv related risks that are floating out there right now with raw and lab diners.

Thanks. Jeff, do you want to take the phasing of revenue and the Terv question?

Yeah. Thanks, Ashley. So in terms of phasing of revenue, we do expect, as mentioned, that revenue is going to be back half weighted with a mid to high single-digit -over-year growth rate in the second half. And that's driven by a number of factors that I was mentioning, including improvements in engagement rings, the fact that Q4 is seasonally an important fine jewelry quarter, and the strong fine jewelry performance that we've been having, growth and isolation of showrooms, and then also noting that we do have a more favorable comment from Q3 of 2024. So I think those are some of the factors that we're considering in terms of thinking about the shaping over the back half of the year. With respect to tariffs, in Q2, as I mentioned, we do have a limited impact, which is included in our guidance. And I think the way that we're thinking about this is that we have been able to move nimbly to mitigate impact of tariffs. And we do believe that we have further opportunities in the rest of the year to manage to similar H2 growth margins as our prior expectations. And this includes operational actions as well as pricing actions. And as you know, we have been able to operationally and with things like price optimization, continue to adapt to dynamic environments over our history. And we think that we're well equipped here. And we also have, as Beth mentioned, limited direct exposure to China. And this is all contributing to us being able to keep our annual adjusted EBITDA guidance at the same level that we had previously indicated in our last call, which includes management of gross margin plus opportunities for increased efficiency in marketing.

I appreciate the color. Thanks.

I'll pass it along. Thank you. One moment for our next question. And our next question will be coming from the line of Oliver Chen of TD Cowan. Your line is open.

Hi, Beth and Jeff. As we think about the growth algorithm going forward, do you expect AOVs to continue to be pressured by fine jewelry? And what are your thoughts on achieving growth of mid-single to high-single digits longer term? Like, what will it take to get there? Will AOVs continue to be down mid-teens for the next couple of years? Thank you.

Thanks, Oliver. I can start that off. So we're really encouraged by the growth that we're seeing in the fine jewelry category. And I gave some numbers earlier that just helps to contextualize it. But the fact that it was up 40% around Valentine's Day, that it's 14% of total bookings just shows you, you know, while we've been growing a lot, even over the last few years, there's still so much headroom in terms of the overall opportunity. We know that for most jewelers, this represents the majority of their revenue. And we're still very early in the journey. And yet, we're also just seeing the brand resonate, the fact that we have a really strong on-trend assortment with proprietary design collections, and that omnichannel experience where we're really able to bring it into both the digital channels as well as in the showrooms where we're also seeing really nice growth. So all of this to me just shows you that we're increasingly known as the destination for fine jewelry for the millennial and Gen Z audience. And so the AOVs that are resulting, you know, is a natural effect of that. And I think it's also just showing the resonance of the brand. Jeff can help, maybe you can help contextualize it a little bit, but I think overall, we're very excited that the strategic initiatives that we have around jewelry are working.

Yeah, and just to complement what Beth said, I think how we get, you know, how we get to higher growth rates is really a continuation of executing along the strategic initiatives that we have been executing on, including as Beth was talking about the success that we're having in fine jewelry, the uplift that we've been able to drive with our showrooms, the engagement with our brand and our products overall, supplemented by ongoing gradual improvement in engagement rings, and we're seeing good signs of that. So it's really a continuation of the focus on the brand and the product and the experience that really gets us to continued success and higher growth rates in the future.

Okay, and a follow-up, but did you say engagement trends are negative? What are your thoughts on when the industry might turn positive? And as we think more broadly, what are some of the building blocks for margin expansion? How do you see marketing as a percentage of sales evolving? And how can you drive more fixed cost leverage? Gold may continue to move against you for the next few quarters, I assume, until your anniversary. That's an unknown factor, but we'd love thoughts there. Thank you.

So I can start on engagement ring trends, which we're seeing positive unit trends. In terms of overall ASP, there are some pressures there overall, but overall that's driven by the fact that under 5,000 is very strong. And I think that's also a nice indicator that the market has normalized quite a bit from where we were over the past few years. So generally, we're encouraged by the engagement trends that we are seeing and the unit growth that we've been seeing. Jeff, do you want to talk a little bit about margin expansion and marketing percent?

Sure, would be glad to. Thanks for your question, Oliver. So in terms of gross margin, just as a reminder to our medium-term algorithm, we have guided to and continue to guide to a high 50% gross margin. And we think that that supported by a number of different things, including a steadfast focus on maintaining our premium brand and not being discount oriented, as well as operational actions that you know, such as our price optimization engine focused on procurement efficiencies and other levers that have been able to get us to the gross margin where we are today. And we continue to be agile with respect to how we navigate environment of gold prices or tariffs. And we think that we're better equipped than the average participant in the industry to be nimble, to leverage the strong relationships that we have with our suppliers and to be data-driven and dynamic in terms of how we approach this, to manage to high and strong gross margin levels. In terms of marketing as a percentage of sales, we do expect to be able to over the next few years, including this year, continue to drive to -over-year leverage in marketing spend as a percentage of sales. And we've been successful in our efforts of growing our brand awareness, using things like the growth of our showrooms to build awareness and drive uplift in metros, to leverage things like buying jewelry, which allows for additional repeat purchase opportunities to capture more opportunities with each of our customers. And we think that those are some of the levers that will allow us to continue to have success in managing marketing expense, as well as our just overall data-driven ROI approach to how we think about all of our leverage. I think that we always have had a mindset of investing towards things like technology to allow us to scale and grow and manage our OPEX efficiently. And we think that as we continue to expand and make those investments and grow our top line base, there greater revenue base.

Thanks a lot. Best regards.

Thanks, Oliver. Thank you. As a reminder, if you would like to ask a question, please press star one, one on your telephone. Our next question will be coming from the line of Dana T��게hs, of Tete Slay advisory group. Your line is open.

Hi, good morning everyone. As you talked about the strength of the two weeks leading up to Valentine's How do you triangulate before and after Valentine's Day of what you saw? What were some of the best sellers during Valentine's Day? And how are you thinking about going forward? And lastly, in terms of pricing with what you had mentioned during gold, how are you thinking about price changes going forward for the different categories? Thank you.

Thanks, Dana. So in terms of the Valentine's Day performance, I think this just is a testament to how well our team and our brands performing in these key occasions. We saw great performance over the holiday period, continued strength with Valentine's Day. We're very excited about upcoming Mother's Day. And I think this is a mix of the assortment that we have, which is very deliberate. I mentioned it's curated, trend forward. And it's also, I think, really brings a lot of newness. So in Valentine's Day, we had a really beautiful heart collection that did really nicely. And then we're continuing to sell our diamond essentials, our unique collections like soul and Jane, as well as some of those occasion specific items. So overall, I would say that the best sellers that we're seeing just are reflective of a lot of the design advantages that we have and the design leadership that we have. And we're going to continue to invest in introducing newness into the category and bringing these fresh new collections to our consumers in a really innovative way with the campaigns behind it. As it relates to how we're thinking about price changes, Jeff mentioned just the data and the nature of our teams. And I think this is another competitive advantage that we have. The pricing optimization engine allows us to be really thoughtful about how we're pricing and just continuing to invest in testing and learning. So, you know, we're we're that's what our history has been, you know, really from the beginning. We're going to continue to implement new tests and just try and understand what the appetite is from the consumer level. You know, obviously, there's a lot of pressures that consumers are feeling now. So we're making sure that we are keeping our costs down as much as we can. But we are testing. And I think the fact that we have a proprietary collection also allows us to have a little bit more flexibility there.

God, and just one follow up on the showrooms. I think this year it's two to three showroom openings. Last year, I think it was seven. How are the showrooms doing? What are you looking for in terms of performance? Is there a difference by region? And if you think about 26, do you do increase the number of openings or how you're looking at it?

Yeah, I think last year we had three openings, if I remember, maybe something around there. So I think we're basically keeping it somewhat consistent. And as we're finding new real estate opportunities, we're leaning in and making sure that we're taking a very ROI driven approach overall. You know, we've got a nice install base at this point with over 40 showrooms. And so we're going to continue to look for opportunities there. But the compliment to that is that we're also looking to invest in our current showrooms. We think there's a lot of opportunity both in terms of bridal, wedding, as well as fine jewelry, where we're seeing really nice growth as well. In terms of how we're thinking about approaching it, you know, we continue to see the Omnichannel model very successful for us. But I don't think we're ready to draw a line in the sand as it relates to 2026 just yet. But continue to see opportunity there. And as we're seeing locations, we are continuing to find new zones.

Thank you. Thank you. One moment for the next question. And the next question will be coming from the line of Dylan Cardin of William Blair. Your line is open.

Thanks. Just on the gross margin bit, it's seen this nice sustained run over several years, I think in some capacity based on the fine jewelry category. But does that now at a point where it also opens you up to more volatility from sort of an input, you mentioned the gold price swing, and I know that's been more volatile than usual, but is it now that fine jewelry is sort of big enough that you can't have sort of the just in time model that you might have on engagement and therefore we should expect kind of more ebbs and flows in gross margin? Thanks.

Sure. I'll be glad to take that, Dylan. So in Q1, our gross margin was slightly lower year over year driven by higher gold costs and labor occupancy spend related to our fulfillment distribution center. And I think we've been able to be nimble and adjust to changing input costs as we have been. And we think that that really represents an advantage for us as a brand with respect to fine jewelry as a percentage of our businesses. Beth mentioned it was about 14% of our bookings in Q1. And I think that there's not a fundamentally different characteristic with respect to how we're thinking about management of input costs. There is some fine jewelry that's made to stock, but we are continuing to be very dynamic and data driven regarding how we manage, whether it's pricing, whether it's how we source, and it's still a smaller part of our business. And the DNA of how we operate is really to take data, take a variety of different inputs, think about how we operate, how we price, and those have been success factors in how we've been able to manage the strong gross margin. I don't think anything has fundamentally changed in that regard.

Thank you. Sure. Thank you. One moment. And we do have a follow-up question coming from the line of Oliver Chen of TD Carowind. Your line is open.

Hi. Thanks again. Beth, would love your take on the roadmap ahead for fine jewelry in terms of what you're doing there with innovation and your plans, or medium term. Also, as you spoke to engagement earlier on that topic, what do you see happening with the customer in terms of the customer looking for value and value-orientated price points there? Do you see that continuing or intensifying, or is that stabilizing? There's a lot of cross currents with consumer confidence. Thank you.

Sure, Oliver. Thanks for the question. So, in terms of the roadmap for fine jewelry, the playbook that we have in terms of introducing these new innovative collections is continuing. So, we had a really successful launch with Jink et al. Last year, we're continuing to invest in that specific collection, so we're deepening the existing collections that we have, as well as introducing newness that's both tied to occasion as well as for self-purchase. So, that's essentially how we're thinking about the assortment, and we're complementing that with digital capabilities that we're investing in, as well as more and more introducing these fine jewelry collections into the showroom and seeing really positive response from that as well. So, that's essentially how we're thinking about the roadmap. As it relates to engagement, I do think that customers have been looking for value price points. I think that's part of the driver why we're seeing kind of out-size performance under the $5,000 ASP. And I wouldn't say that that has changed in Q1. We still see relatively similar performance as it relates to that engagement rate in consumer, but certainly this is a category where people shop with a budget, and it is, I think, a fact that consumers are more cautious these days. But we're still seeing sustained unit growth, and I wouldn't say that Q2 is materially different.

Thanks again.

Thank

you, Oliver. Thank you. And that does conclude today's Q&A session. I would like to turn the call back over to Beth Gerstee for closing remarks. Please go ahead.

Thank you, everyone, for attending our Q1 call. And we're looking forward to talking to you for Q2. And happy Early Mother's Day, and hope to just talk to you all soon.

Thank you all for joining today's conference call. You may now disconnect.