Fast Radius, Inc.

Hello, thank you for standing by, and welcome to the Fast Radius First Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 1 on your telephone. Please be advised that today's conference may be recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to Greg Robles of Investor Relations. Please go ahead.

Good morning, ladies and gentlemen, and welcome to the Fast Radius first quarter 2022 conference call. Delivering today's prepared remarks are co-founder, CEO, and chairman Lou Rassi and chief financial officer Prithvi Gandhi. Following their remarks, we will open the call for your questions. Before we go further, I will now read the company's safe harbor statement that provides important cautions regarding forward-looking statements. On today's call, we will be referring to the press release issued this morning that details the company's first quarter 2022 results, which can be downloaded from the investor relations page at ir.fastradius.com, where you'll also find the latest earnings presentation that supplements the information discussed on today's call. A recording of the call will be available on the investor section of the company's website later today. Please be aware that some of the comments made during this call may include forward-looking statements within the meaning of the federal securities laws. Statements about the company's beliefs and expectations containing words such as may, will, could, believe, expect, anticipate, and similar expressions constitute forward-looking statements. These statements involve risks and uncertainties regarding the company's operations and future results that could cause Fast Radius' results to differ materially for management's current expectations. While the company believes that its expectations are based upon reasonable assumptions, numerous factors may affect actual results and may cause results to differ materially. So the company encourages you to review the safe harbor statements and risk factors contained in today's press release and in its filings with the Securities and Exchange Commission, including its form 10Q filed today in periodic reports which identify specific risk factors that also may cause actual results or events to differ materially from those described in our forward-looking statements. The company does not undertake to publicly update or revise any forward-looking statements after this conference call. The company also notes that on this call, it will be discussing non-GAAP financial information, including adjusted EBITDA. The company is providing that information as a supplement to information prepared in accordance with accounting principles generally accepted in the United States, or GAAP, GAAP. You can find additional information and a reconciliation of these metrics to the company's reported GAAP results in the reconciliation tables provided in today's earnings release and presentation. And now, I'll turn the call over to Lou Rassi. Lou?

Good morning, everyone, and thank you for joining us. On today's call, I'll provide a brief overview of FastRadius. summarize our first quarter of 2022, and then go deep into the progress we've made in building out our cloud manufacturing platform, specifically new software releases that have been increasing our customer leads and acquisition, and further advancing software applications enabled by cloud manufacturing. I'll then hand it over to Prith Gandhi, our Chief Financial Officer, to cover our Q1 financials in greater detail, and then I will return with concluding remarks. Let's start with a quick recap of who we are, what we do, and what drives us. Fastradius is a leading cloud manufacturing and digital supply chain company. Our purpose is to make new things possible to improve the state of the world. Manufacturing is central to our lives, and now in the digital age, the sector's potential to drive progress in the world is significant and clear. We have new tools to design, make, and move products in ways we couldn't have imagined even a decade ago. We are building the platform and infrastructure to empower engineers to design, make, and move what they need, when and where they need it. With that mission guiding us, our product is the Fast Radius Cloud Manufacturing Platform, a first-of-its-kind platform that provides software applications, manufacturing solutions, and a network of factories that help engineers to design, make, and fulfill commercial-grade parts. This enables companies to manufacture and ship parts more easily, flexibly, and sustainably, or making it possible to store parts digitally instead of on a warehouse shelf. We're making it possible to ship parts digitally instead of by boats and planes. We're making it possible to make things local to where they are needed. We're allowing our customers to move away from carbon intensive supply chains and helping manufacturers adapt to the needs of our time. We're codifying substantial manufacturing knowledge and putting it in software. We're then empowering any engineer with a browser to design new things in new ways and then have the power to manufacture them. With that context, I want to briefly discuss the market we operate in today and the areas where we believe there's significant opportunity in the future. Let's start first with the market that is making component parts. Today, Fast Radius makes money by making parts for customers across a wide range of industries, from automotive and aerospace to healthcare and consumer goods. For making component parts less than 100,000 units annually, the total addressable market is approximately $350 billion. This includes a wide selection of manufacturing technologies we implement, such as additive manufacturing, injection molding, sheet metal, and CNC machining. The component part, making market, is an important and large market that we are tackling, and it's being reset by powerful forces, including Industry 4.0. Industry 4.0 is not simply one new technology that's advancing the state of manufacturing, but many innovations that are reimagining together how we can design, make, and move products in this world. Other tailwinds include our expertise in Industry 4.0 innovation versus broader innovation industry pace to adopt these innovations, the demand for modern software-driven experiences by our customers, mirroring consumer-like digital experiences, and also the need for more flexible and sustainable supply chains. These are tailwinds and opportunities which we are tackling and working to capitalize on. Now, on the software side, if you consider the market that's opened up by cloud manufacturing, the opportunity over the long term could become even larger. Similar to cloud computing as a platform for digital innovation, cloud manufacturing is a platform for manufacturing innovation, ushering in a new era of software tools and manufacturing solutions powered by the cloud. For example, our goal is to codify the world's manufacturing knowledge and make it accessible to anyone with a browser. So Fast Radius is building software tools that provide feedback on the manufacturability of a part that are complementary to existing design and engineering simulation software tools. Design simulation software is used by millions of professionals and represents a large addressable market that we expect our future products to complement. We believe these types of new software products and business models that are enabled by cloud manufacturing such as digital design assistance, digital parts storage, digital logistics, could create potential new pools of value and opportunities for us in the future. Let's now look high level at our first quarter 2022 performance. Our first quarter revenue was $6.3 million, up 65% compared to the same quarter of the prior year. We're also pleased to be increasing our 2022 full year revenue guidance. to $29 million to $34 million. This range would represent between 45% and 70% year-over-year revenue growth. Prith will cover our financials in more detail shortly, and I'll next cover our strategic initiatives. As part of our growth plan for 2022, we've previously communicated where we plan to focus our efforts and investments this year, which are as follows. We're focusing on enhancing our customer acquisition motions for both new customers and account expansion with a common theme of driving digital engagement. Second, we're focused on enhancing our user experience and digital workflows with our marketing, sales, manufacturing, supply, and product teams working together to improve the customer journey from beginning to end. Third, we're building out and optimizing our supplier network and marketplace. And fourth, we're seeking additional capital to help us meet our business needs and support our growth objectives. Our team has executed against each of these areas during the first quarter, and I'll describe our progress today. First, we made strides in enhancing our customer acquisition motion for both new customers and existing customers with account expansion with a goal of driving more digital engagement. Specifically, our newly formed digital direct sales team has helped to increase the volume of customers to our software portal and digital experience for our customers. We've developed a scalable self-serve experience for customers to order parts and engage with us. This team partners with our reorganized managed sales team, complementing their efforts in driving new customer acquisition. We also invested in digital marketing this quarter to drive users to engage with our platform earlier in the product development lifecycle through our latest software release, Studio, which we will discuss more in a bit. Second, we've been working towards enhancing our user experience and digital workflows. We released new features within our customer portal that have attracted positive responses from users and supplier partners alike, further demonstrating progress on our software strategy. We've expanded the suite of design for manufacturability checks for CNC machining, additive manufacturing, and injection molding. We have introduced auto quotation for 3-axis CNC machining. We have expanded inspection options directly available to our customers through the digital platform. We've also made foundational progress by continuing to automate workflows that improve our ability to efficiently support our customers. Next, we have been focused on building out and optimizing our third-party supplier network and on-demand marketplace to increase our manufacturing capacity. As we build out and optimize our platform, we are targeting improvement in a variety of areas, including faster lead times, improved cost, and access to an expanded set of manufacturing technologies. Specifically, over the last three months, we've expanded our partner network to include new suppliers, including in the U.S., Mexico, and Taiwan. We also released a new version of our supplier digital portal, which enables more streamlined interaction between customers and suppliers through the order and fulfillment process, such as suppliers being able to share capacity information, quoting and accepting jobs through the portal, and providing transparent production information about each job. We also created a digital onboarding experience for our suppliers to allow us to more efficiently add more suppliers and more capabilities to our marketplace. In addition, we revamped our marketplace operating model to allow us to more efficiently match customer opportunities with supplier capabilities. Lastly, we communicated the need to secure additional capital in 2022. We have been diligently evaluating potential options to obtain additional capital to help meet our business needs and support our goals of growth, and ultimately driving toward profitability. As Prith will discuss further in a few minutes, we have entered into an agreement with Lincoln Park Capital for issuance of up to $30 million of our common stock, which we expect will provide us with additional liquidity while we continue to work through additional capital raising options. Now, I want to provide more information on our innovative new software release. In Q1, we released significant new features in our FastRadius portal. We call this new offering Studio. In its simplest form, Studio allows design and manufacturing engineers to gather insights and recommendations about the part they're designing. This new offering helps FastRadius users discover opportunities to innovate, be it to save on product costs, improve product performance, or drive sustainability via new material choices. Specifically, users can now log in, upload their file, and evaluate their parts. The user can select from a different set of manufacturing technologies, manufacturing, CNC machining, or injection molding, and they can receive instant design feedback and recommendations. Users are also able to compare manufacturing methods, materials, design checks, quantity, lead time, and prices side by side in real time. We believe this is a significant improvement on traditional methods where individual engineers chase scarce and fragmented expertise to inform their design. Studio provides our users with efficient ways to get insight, design, and collaborate. Another great aspect of Studio is that it provides users with a seamless transition into the quoting and ordering process. If users are satisfied with their part design, they simply move their part into the quoting stage with just one click versus the traditional industry approach, which is highly manual, multi-step process to move from design to quoting and ordering. By providing upfront value in the discovery and evaluation phase of design, we believe it will help drive more potential customers to submit orders to make parts with Fast Radius. Now, I want to elaborate on how we're able to provide these insights and recommendations to our studio users. As we've previously discussed, a crucial part of our cloud manufacturing platform is our digital thread and learning engine. For the last five years, you've been making products in a state-of-the-art digital-driven network of factories, including our Chicago location, recognized by the World Economic Forum as one of the most advanced factories in the world. Our digital thread connects and collects data through every layer of our cloud manufacturing platform. Our customer software, driven experiences, our owned and operated factories, and our supplier network. With every part made, our learning engine can get smarter. Data is captured, codified, and that knowledge ultimately gets surfaced back into the upfront user experience. Studio connects all of these components and enables our users to access this intelligence through our platform. So what's the impact for our customer? Simply put, we're democratizing access to design tools for manufacturing parts. Traditionally, for an engineer to evaluate their part and compare manufacturing options, they have to communicate via multiple phone calls, emails, or other cumbersome and fragmented methods. With Studio, we are empowering engineers to explore, providing them credible insights, digitally storing that part if they're not ready to order it, and then ultimately reducing friction as parts move into production. We believe our ability to automate and provide a seamless experience for customers to move through this discovery, evaluation, and design process is not only great progress for the industry, but a differentiator for Fast Radius. We are cultivating a community of users for cloud manufacturing, which we see as an attractive lead generation engine and a way to build a pipeline of customers for parts revenue. We are thrilled to report that as of the end of Q1, over 10,000 users have signed up to use our platform, which we believe is a positive signal for digital engagement. In the future, we will explore opportunities to monetize our software, which we do not do today. Now I'll pass it over to Prith to cover the financials in further detail. Prith.

Thanks, Lou, and good morning, everyone. Our revenue for the first quarter of 2022 increased 65% euro a year to $6.3 million compared to $3.8 million a year ago. The increase was driven by new customer sales, increased revenue from existing customers, and strong execution by our supply chain team at the end of the quarter to address the effect of COVID-related shutdowns in China and ship products that would otherwise have been delayed into Q2. Our gross margin percentage was 10.1% in the first quarter of 2022, compared to 21.9% in the year-ago period. The decrease was largely due to an investment we made in a new CNC manufacturing facility in 2021, which is currently running at low utilization as we ramp up production. In the first quarter of 2022, our sales and marketing expenses G&A expenses and research and development expenses were all significantly impacted by increased stock compensation expenses. The expenses associated with certain awards were contingent on the closing of our SPAC transaction completed in February. Our sales and marketing spend was $6.3 million for the first quarter of 2022 compared to $3.5 million for the year-ago period. The increase was attributable to higher stock compensation expense and increases in spend related to online advertising and marketing and promotional activities combined with organizational headcount growth within the function. Our GNA spend was $38.2 million for the first quarter of 2022 compared to $7.7 million in the first quarter of 2021. The increase was attributable to higher stock compensation expense, cash bonuses paid to certain executives, that were contingent on the closing of our business combination and costs related to our software subscription agreement with Palantir. Additionally, we incurred incremental legal, consulting, and accounting costs to support our growth, including costs related to the business combination and new costs associated with being a publicly traded company. Approximately $27 million of our G&E expenses in the first quarter related to cumulative catch-up adjustments to expense and non-recurring expenses related to our business combination. And as a result, we expect G&A expenses to decrease materially in subsequent quarters, with Q1 G&A expense representing over 50% of our total G&A outlook for 2022. Research and development costs were $3.3 million for the first quarter of 2022, compared to $1.1 million for the year-ago quarter. The increase was related to higher stock compensation expense and costs associated with developing our cloud manufacturing platform, including higher employee costs. As a result of these increases in operating expenses, our loss from operations for the first quarter of 2022 was $47.3 million, compared to a loss of $11.5 million for the first quarter of 2021. Adjusted EBITDA for the first quarter of 2022 was a loss of $21.2 million compared to a loss of $8.2 million for the year-ago quarter. The higher loss in the Just City BIDA compared to the prior year period was driven by the increase in operating expenses as previously noted. For our key business metrics, for the first quarter, we had approximately $7 million in total bookings, representing 36% year-over-year growth. The bookings were well distributed across our range of manufacturing technology offerings, with a majority in CNC machining, injection molding, and certain additive manufacturing applications. As a reminder, total bookings represent the anticipated contract or purchase order value of goods and services to be delivered in the future under contracts which have been executed, as well as contracts under negotiation that are priced, fully scoped, verbally awarded, and expected to be executed shortly. The majority of our Q1 bookings is expected to convert into revenue within the quarter of booking and the four subsequent quarters. However, quarter to quarter, there may be variation in bookings conversion, particularly with larger orders. Now, turning to the balance sheet. We had $57 million in cash and cash equivalents as of March 31st, 2022. As mentioned previously, We have been working to secure additional capital and have entered into an agreement with Lincoln Park Capital for the issuance of up to $30 million of our common stock. These proceeds may be used at the company's discretion and on an as needed basis, subject to market conditions and other factors, providing us with the flexibility to access some liquidity while we continue to evaluate additional options with respect to our capital structure. Further details of this facility are provided in our Form 8K and our Form 10Q filed this morning. Now, I'll turn the call back over to Lou for closing remarks. Lou?

Thank you, Prith. As we've covered, we're pleased that based on our first quarter 2022 performance and positive momentum in the business, we are increasing our 2022 revenue guidance and now expect to deliver between $29 million and $34 million in revenue We are maintaining our adjusted EBITDA outlook as we continue to expect an adjusted EBITDA loss of between $72 million and $65 million for the full year 2022. Over the past several months, we formulated a plan that was focused on scaling our company with four clear priorities. Enhancing our customer acquisition motions, enhancing our user experience and digital workflows, building out and optimizing our supplier network and on-demand marketplace, and securing additional capital. And we are executing on this strategy. While we have continued to face headwinds from market conditions, geopolitical tensions, supply chain issues, and part shortages, our team remains committed to managing well through these headwinds and delivering on our strategy to drive growth and ultimately value for our shareholders. I'm grateful for our team's perseverance. In closing, I want to thank our team at Fast Radius. We are executing on what we committed to do together. and are pleased with growth and progress this quarter, particularly with respect to our launch of Studio and improvements to our cloud manufacturing platform. We are excited to continue the execution of our plan and for the road ahead, and we look forward to updating you again following Q2. Operator, we're now ready to take questions.

Thank you. Before we begin Q&A, Mr. Rassi has additional remarks.

I wanted to address some of the things happening in the macro environment, particularly the challenging capital markets and the continued global supply chain lows, and then discuss their impact on us at Best Radius before we get into Q&A here in a moment. First, the capital markets. We deeply appreciate the strength of the current storms and the effects and the weight it has had on us and companies like us. We see investors shifting their investment focus. the recent tightening of capital for growth in tech companies, and the importance of driving profitability. Specific to Fast Radius, we also acknowledge the balance sheet following our D-SPAC transaction wasn't what we envisioned prior to closing, adding further to the work we need to do in this stormy climate. But here we are. We get it. We know we have work to do to continue to build your trust as a newly public company. We are tackling it eyes wide open and with conviction on our ability to navigate through it and execute on what we can control. In that spirit, last we met, we reset our performance expectations based primarily on our post-closing balance sheet. We have been open on the need for us to raise more capital this year and to maintain operating and financial discipline as we grow. We're pleased with today's report for our first quarterly performance against the expectations we set. We are growing. and we have taken measures to both contain costs and increase our liquidity. And there is more we plan to do on both fronts as we chart our path to profitability. We intend to be transparent along the way, and we will continue to work tirelessly to execute on the items in our control. The second macro storm I wanted to comment on is the global supply chain woes. It remains in the headlines every day. The world and our country are loudly calling or modern manufacturing capabilities, and new, more flexible, more sustainable, and more accessible supply chains that meet the needs of our time. Our company was purpose-built to help these challenges. And we are, for thousands of customers that we have worked with across industries. Related to this theme, we applaud President Biden's announcement of the initiative to advance adoption and access to 3D printing and digital manufacturing. Our factory in Chicago, which embraces industrial-grade 3D printing, is deemed by the World Economic Forum to be a global White House as one of the most advanced factories in the world. So we see the power of new manufacturing technologies being put to work every day. We have also seen firsthand the power of private and public collaborations making a difference. Chief scientist Bill King was one of the founders and the CTO of the National Laboratory for Digital Design and Manufacturing, known as MXD, one of the national network of innovation institutes spearheaded by the Obama administration. In fact, that is how Bill and I met. These types of collaborations create access to new ideas and technologies, and they can help connect like-minded people and companies to pursue bold things and drive progress. Our purpose at Fast Radius compels us to continue playing our part to advance the state of manufacturing and to support the critical work of making it more sustainable, more innovative, and more accessible for everyone. This important work is why we exist at Fast Radius. We're building and scaling a new type of infrastructure for the manufacturing industry in the digital age. Five manufacturing aims to empower everyone to design and make what they need, when and where they need it. Thank you for taking the time with us today to keep tabs on our journey. Operator, we can now open it up to Q&A.

Thank you. As a reminder, to ask a question, you'll need to press star 1 on your telephone. To withdraw your question, press the pound key. Our first question comes from Jim Riucci with Neato. You may proceed with your question.

Hi, good morning. I wanted to follow up, Lou, on the comment you made about the steps you're taking to control costs because, you know, clearly you're also in a growth mode and you have to invest. And so I'm wondering, you know, where, which areas do you feel you can take cost actions while still executing on the growth strategy? Okay.

Thanks for the question, Jim. And as you noted, it is a balance between investing for growth while also preserving our balance sheet. And there are a few areas that we would highlight. First is our business model is flexible. We have micro factories that we own and operate and an extended network of supply chain partners that can plug into the cloud platform digitally. And so we have chosen this year to invest heavily in the supplier network and that side of our marketplace model reducing the CapEx that's required for us to grow. And we can keep leaning on an extended supplier network to really minimize CapEx requirements as we get to scale and ultimately drive to profitability. So I think that's one big area, Jim, that I would highlight. I think a second is around customer acquisition and thinking about a product-led growth model. I talked a bit about Studio. and how this is building a community of engineers who are in the early stages of discovery and design, using a software to gather insight and understanding, and ultimately that's a way for them, when they're ready to start making the parts, for us to partner with us. And so being innovative and creative on more efficiently acquiring our customers in a product-led, software-led growth motion, we think also presents real opportunities. In addition to that, there's some very practical things as well. We have managed our headcount growth. We have been instituting digital workflows that allow us to scale and get leverage from the team that we have, and that's been a good factor here in the first quarter as well. And then I think there's blocking and tackling around working capital as we look at payables and receivables and management and execution around those that are also making a difference And I think all of those things together, we have been very purposeful, Jim, in putting a plan together, executing on that plan in Q1 with line of sight to continued progress as we look through the rest of the year. And we're mindful of the importance of that as we ultimately onboard more capital and drive to profitability.

Okay, Jim, a couple other things. We're also in discussions with some of our key suppliers on improving the cost of our materials and our equipment. And then, of course, we're being very focused on all controllable spend like travel and those types of things.

Got it. And I have two other questions, one on the CNC portion of the business and bookings, and the second just with respect to studio. So first on the CNC side, you sound like you attributed some of the booking strength, maybe a meaningful part of the booking strength from CNC. You also have this underutilized CNC capability. Do you see that helping the utilization over the next couple of quarters? And to what extent do you anticipate that to help your gross margins over the next couple of quarters?

I think a few things, Jimmy, as you noted. We have invested in the CNC factory last year, and that is underutilized, and that is a weight as we look at aggregate gross margins. And so we do see continued benefit as we continue to drive growth and leverage from that factory.

Hey, Jim, just to add to Lou's comment. For the full year, we're planning gross margins in the order of the opportunities. And so as we've said before, Our external production delivers mid-20s gross margin. Based on our current utilization in our internal factories, our internal gross margin is below that. And so for a full year, we're planning in the upper teens for gross margin. So that should give you a sense for the improvement coming as we ramp up production.

That is helpful. Thank you. And just on studio, I may have missed it, but I think you said, and I'm not sure, 10,000 users have signed up to use the software. I'm trying to get a sense. As I look at the revenue growth that you demonstrated year over year, how much of the business that you're seeing is coming from new customers or is it fairly immaterial now, and you expect it to ramp as these customers scale?

We see significant acceleration from new customer acquisition through tools like Studio that are sitting on top of the cloud platform, Jim. I think we're in the very early days, and I think it is a source of growth we're really excited about. As we look year over year, we have seen our existing customers grow with us. There is this flywheel that we've talked about before that we continue to see a year-on-year expansion of the customers that start doing work with us. But we are adding new customers every week, every month as well, and there is this growth flywheel both for existing customers But then as we continue to build out the cloud platform and the tools that sit on top, you know, that is an area of growth acceleration we are excited about, and we'll share more on in the coming quarters. Okay. Thank you. Thanks, John.

Thank you. And as a reminder, to ask a question, you'll need to press star 1 on your telephone. Our next question comes from Troy Jensen with Lake Street Capital. He may proceed with your question.

Hey, gentlemen. Thanks for taking my questions here. Maybe the first one for Lou. Software functionality. I guess I'd be curious to know how competitive is what you guys offer versus traditional CAD software suppliers?

Hi, Troy. Thank you for the question. I think we see ourselves as very complementary traditional CAD providers. We're not building a new CAD system. tool, rather we're building a suite of tools that sit adjacent to CAD to provide insight on the design of parts and the manufacturing of parts. And as I mentioned in the remarks, because we're actually making products and we are working closely with a network of factories and suppliers that are making these products and we're aggregating data about those and lessons about those, we're able to provide unique sources of insights about the design and manufacturability of parts that is rooted in the actual making of things and the making of your specific things. And that, we believe, is one of the really unique value propositions and compelling value propositions of cloud manufacturing. And so when we think about the types of insights that we can provide, we see it as very complementary to the physics-based design tools and engineering design and simulation tools. And cloud manufacturing is opening up a new white space, we believe, where using the data and insight from how things are made and when and how your specific things are made is something that is not readily available. And that's why we see this as something that's very complementary and directly adjacent to a traditional CAD and engineering software.

Okay, perfect. Maybe a couple here for Chris. On the Lincoln Park agreement here, I guess as you guys issued them stock, are they just getting the stock at the current market valuation, or is there any kind of discounts or warrants on this agreement?

Yeah, good question, Todd. So, you know, yeah, there is a formula that's based on kind of looking at the lowest three prices over the, you know, prior 10 days from when we decide to – issue any stock under the agreement. So that's the way the formula is derived.

Okay. All right. Perfect. And Prith, for you, what do you think, I'm just trying to figure out, what are you guys going to end the year at for like an EBITDA run rate? And I know you said, you know, what the quarter was and what the guidance was for the year, but I mean, will you guys be turning profitable next year on an EBITDA basis?

Yeah. I think it's, you know, I think based on our current plans, it's probably towards, you know, the latter part of 2023, early 2024 is when, you know, we would look at turning profit.

Okay. And just one last question, you know, in the spirit here of expense reduction, you guys raised your revenue guidance by $2 million, but I don't think you changed your EBITDA guidance. And is that just input cost?

Yeah, good question. Good question, Todd. Sorry. I mean, at our current gross margins, you know, the impact to adjusted EBITDA, it's not very material, and that's why you don't see much movement in the adjusted EBITDA range.

Yeah, that makes sense. All right, guys, thanks again. Good luck. Thank you, Trevor.

Thank you. Ladies and gentlemen, this concludes today's question and answer session. I would now like to turn the call back over to Mr. Rassi for closing remarks.

Thank you, and thanks, everyone, for taking the time to take stock of where we are, and we'll look forward to connecting again very soon. Have a good day, everyone.

Thank you. Ladies and gentlemen, this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.