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spk10: Good afternoon, ladies and gentlemen, and welcome to Massimo's first quarter 2022 earnings conference call. The company's press release is available at www.massimo.com. At this time, all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. I'm pleased to introduce Eli Kammerman, Massimo's Vice President of Business Development and Investor Relations. Please go ahead.
spk00: Thank you, and good afternoon, everyone. Joining me today are Chairman and CEO Joe Chiani and Executive Vice President and Chief Financial Officer Micah Young. This call will contain forward-looking statements which reflect management's current judgment, including certain of our expectations regarding fiscal year 2022 financial performance. However, they are subject to risks and uncertainties that can cause actual results to differ materially. Risk factors that could cause our actual results to differ materially from our projections and forecasts are discussed in detail in our periodic filings with the SEC. You will find these in the investor relations section of our website. Also, this call will include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles or GAAP. We generally refer to these as non-GAAP financial measures. In addition to GAAP results, these non-GAAP financial measures are intended to provide additional information to enable investors to assess the company's operating results in the same way management assesses such results. Management uses non-GAAP measures to budget, evaluate, and measure the company's performance and sees these results as an indicator of the company's ongoing business performance. The company believes that these non-GAAP financial measures increase transparency and better reflect the underlying financial performance of the business. Reconciliation of these measures to the most directly comparable GAAP financial measures are included within the earnings release and supplementary financial information on our website. Investors should consider all of our statements today, together with our reports filed with the SEC, including our most recent form 10-K and 10-Q, in order to make informed investment decisions. In addition to the earnings release issued today, we have posted a quarterly earnings presentation within the investor relations section of our website to supplement the content we will be covering this afternoon. I'll now pass the call to Joe Chiani. Thank you, Eli.
spk03: Good afternoon, and thank you for joining us for Massimo's first quarter 2022 earnings call.
spk01: This quarter was an anomaly
spk03: from the perspective of reported revenue and earnings due to supply chain problems. I'm happy to report that as of today, we have manufactured almost all of the backman delays that are out of our control. We are on track to meet the second quarter revenue expectations. We believe we have addressed the supply chain challenges we saw in the first quarter related to component shortages and limited labor availability at our manufacturing facilities. In addition, we have significantly increased our manufacturing output, which should allow us to not only meet our I'm happy to report that hospitals are steadily returning to normal practices
spk01: and procedural concerns about the pandemic easing, we are seeing a rebound in elective surgeries and seeing better access for our sales force within and consistent customer demand for our technologies and demand as we continue to
spk03: to win new contracts at a fast pace while maintaining the strong... While our revenues rose only modestly in the first quarter due to the supply chain issues, we still expect to deliver double-digit constant currency revenue growth this year.
spk01: 2022 will be an exciting year for massive... into some very large new markets in consumer health and wellness, as well as into technology.
spk03: In April, we closed the Sound United transaction ahead of schedule.
spk01: The team at Sound United will be invaluable for enabling successful products over the next 12 months and beyond. The company also brings a series of brands
spk03: and technologies that we can leverage to create some very innovative products that combine Massimo technologies with theirs. Sound United has built a broad network of global distribution channels that will serve us well as we introduce products such as our biosensing watch and augmented hearing devices, among many other planned innovations. We are excited about the potential of our combined businesses to capitalize on the growing trend of moving care from hospital to home. I will ask Micah to review our first quarter results in more detail and provide you with an update on our 2022 financial guidance.
spk04: Thank you, Joe, and good afternoon, everyone. Before I get started, I want to direct you to the earnings presentation on the MASMO website, which covers much of the detail that we will be discussing today. Our first quarter results illustrate our ability to increase earnings even in the face of supply chain issues that limited our shipments and sales growth. The strength in the demand from our customers can be seen in our driver shipments, which met our expectations by reaching 75,700 as we had our third consecutive quarter of driver shipments of approximately 75,000 units. We have now shipped over 2.3 million technology boards and instruments over the last 10 years. For the first quarter of 2022, We reported revenue of $304 million, representing 2% reported growth and 3% constant currency growth. Our results were adversely affected by certain supply chain issues, which we have addressed.
spk01: How we exceeded our revenue and earnings expectations was due to strong customer demand.
spk04: Our first quarter 2022 non-GAAP gross margin increased 140 basis points to 67.5% compared to 66.1% in the prior year period. Our gross margin improvement was driven by favorable product mix as we derived a higher proportion of our revenues from it. Our first quarter 2022 non-GAAP operating profit margin of 22.9%. In comparison, first quarter 2021 non-GAAP operating profit was $68 million or an operating margin of 22.9%. In 2022, non-GAAP net income was $53 million or $0.93 per diluted share. In comparison, first quarter 2021 non-GAAP income was $52 million or $0.90 per diluted share. Overall, for the first quarter, we achieved earnings growth that was in line chain challenges that affected production volume and our driver shipments have held steady at roughly 75,000 of our core business now I'd like to provide you with an update on our 2002 or two including expectations for which closed three weeks ago Due to the acquisition and timing of revenues stemming from supply chain challenges in the first quarter, we are providing consolidated guidance ranges for the second quarter and for the full year. Our guidance incorporates increased foreign currency headwinds from the strengthening of the US dollar against most major currencies. For the second quarter of 2022, We are projecting consolidated revenue of $525 to $555 million, which includes $180 to $190 million of revenue for Sound United from the closing of the transaction on April 11th through the end of the quarter. For our healthcare business, we are projecting $345 to $365 million of revenue, which includes $4 million of year-over-year currency headwinds. For the first half of the year, this implies a revenue range of $649 to $669 million for our healthcare business, which reflects 9% to 12% constant currency growth. Consistent with what Joe mentioned earlier in the call, this outlook illustrates our confidence in recapturing a large portion of the delayed revenues in the second quarter while being thoughtful about the broader supply chain environment Going back to our second quarter guidance, we are projecting consolidated non-GAAP gross margins of 56%, operating margins of 18%, and earnings per share to $1.25. Now moving on to our full year 2022 financial guidance. For the full year, we are projecting consolidated revenue of $2 billion to $2.06 billion, which includes $660 million to $700 million of revenue for Sound United from the closing of the transaction on April 11th through the end of the year. For our healthcare business, we are projecting revenue of $1.34 to $1.36 billion, which includes $17 million of year-over-year currency headwinds. This implies a constant currency revenue range of $1.357 to $1.377 billion compared to our prior constant currency guidance of $1.357 billion. This update reflects 9.5 to 11% constant currency growth for our healthcare business. We are also projecting shipments of at least 300,000 technology boards and instruments this year. On a non-GAAP basis, we are projecting gross margin of 56% for our consolidated business, which assumes gross margins of 36% to 37% for Sound United and 66.5% for our healthcare business. Incorporating our guidance for the remainder of the year are higher freight and product costs, which we believe will be partially offset by increased manufacturing efficiencies and cost reduction efforts. On a non-GAAP basis, we are projecting an operating margin of 18% to 19% for our consolidated business, which assumes operating margins of 5% to 7% for Sound United and 24.8% for our healthcare business. It is important to note that Sound United's operating margin guidance includes co-development and co-commercialization investments that will drive the expected benefits of this acquisition.
spk01: These initiatives will allow us
spk04: to enter and expand into large and growing markets that are an order of magnitude larger than the markets we serve today. These investments represent roughly 2% of Sound United's non-cash share-based compensation expenses, which represent approximately 4% of Sound United's revenue. Lastly, the continued strengthening of the U.S. dollar against most major currencies has negatively impacted Sound United's operating margins by a magnitude of 2%. Moving further down the P&L, our non-GAAP non-operating expense for the consolidated business is expected to be $18 million in 2022. This is primarily comprised of the interest expense associated with the roughly $600 million drawdown against the new credit facility used to finance the acquisition. We are also projecting a non-GAAP tax rate of 25.3% and weighted average shares outstanding of $58.2 million for the consolidated business. Based on these assumptions, we are projecting a non-GAAP VPS range of $4.46 to $4.73 on a consolidated basis.
spk01: To summarize, our core healthcare business is on track to meet or exceed expectations and steadfast in our commitment to achieving 10% for this business. I've never been more excited about our long-term financial future. For additional details on our
spk04: 2022 financial guidance, please refer to today's earnings presentation within the investor relations section of our website at massimo.com.
spk01: As part of our strategy to be a leader in the growing trend of moving healthcare from hospital to home, as well as to deploy Massimo technology in all settings where it can be useful.
spk03: With the acquisition, we announced our intent to launch some high-potential products in the consumer health and wellness area on biosensing earbuds.
spk01: Sound United has a healthy and growing presence with its premium brands. In addition to the brands, we saw at least four very valuable assets in Sound United that influenced
spk03: our decision to acquire the company. One, a well-established network of global distribution channels with over 20,000 for our upcoming consumer health and wellness product launches. Two, a connectivity software platform called HEOS that can connect any type of digital device to flow data through a network for telehealth and telemedicine systems.
spk01: Three, hearing devices that incorporate Massimo's advanced signal processing technologies.
spk03: We have a leadership team and accomplished professionals with sales, marketing, and advertising expertise who can facilitate a successful launch of our consumer health and wellness products over the next 12 months and beyond. In 2021, Sound United saw strong demand for its home theater products as consumers stream more content at home than ever before. Sound United has reinvested in the Bowers & Wilkins brand with numerous product launches such as the 800 Diamond Series loudspeakers, P15 and P17 wireless headphones, and iconic Zeppelin wireless speaker. Looking at 2022, Sound United should continue to benefit from the growth of high-resolution audio streams that should drive adoption of premium home entertainment systems which can process it. The company also has new products from the Bowers and Wilkins brands, such as the Panorama, Soundbar, and new headphone models. The brand will also be growing its partnership with renowned automotive brands such as BMW, McLaren, and Volvo. Launch plans for 2022 include new industrial design and connected functionality across the suite of Marantz products, as well as Denon, expanding its reach with an enhanced offering of home wireless surround sound speakers and home theater solutions. And Polk, extending its lineup with several Dolby Atmos soundbars.
spk01: As you can see from the earnings presentation on to over $180 billion as we expand into new, large, and growing consumer health and wellness markets.
spk03: While we expect brands like Bowers & Wilkins, Denman, Marantz, and Polk consumer products to achieve strong growth on their own, we do believe our healthcare business, including hospitals and home, with help from our entire organization, will grow more rapidly and eventually constitute the vast majority of our revenues. Some of the markets I'm truly excited about are the opportunities for combined products we will be introducing, such as biosensing watches and augmented hearing devices. Just imagine the incredible audio engineering of Bowers & Wilkins, Marantz & Denon, in combination with Massimo's advanced digital signal processing and biosensing engineering. They pioneered innovations for the incredible sound we experienced with those top-tier brands, and we pioneered the use of advanced signal processing such as adaptive filters, systems theory, and AI in the biosensing arena. We believe we will pioneer incredible new solutions together, all for the betterment of life. The strategic work of Massimo in consumer health and wellness and into the home with telehealth technologies began many years ago with a focused research and development effort to capitalize on emerging use cases for our technologies. Examples of these products include the launch of ISP02 in 2012, RADIUS PPG for safety net in 2019, and sleep in 2020, as well as RADIUS-T for temperature monitoring in 2020. And just yesterday, on the 33rd anniversary of our incorporation, we announced the limited market release of Massimo W1, our first biosensing watch, offering continuous and accurate pulse oximetry and other measurements. Our ability to help lives can go beyond the confines of hospitals and long-term care facilities. We are very excited by what we can do to help improve lives in other settings, especially the home. We will have more to say at our upcoming investor day in September here in Irvine. I hope you'll all be able to join us to learn more about the future of Massimo and what it will mean to the lives of many. We've expanded our mission to improve life, and we remain committed to our mission of improving patient outcomes, reducing the cost of care, and taking noninvasive monitoring to new sites and applications. With that, we'll open the call to questions. Operator?
spk10: If you would like to ask the question, please press star followed by the number one on your telephone keypad. To withdraw your question, please press star one again. Our first question comes from Rick Wise from steeple. Please go ahead. Your line is open.
spk06: Good afternoon, Joe. Hi, Micah. Let me ask one on the base business and one on Sound United. The base business I mean, clearly came in in the middle of your range. Help us think, Micah, perhaps I'll start with you, about the setup to the second quarter for the core business. Clearly the full year is on track. You reiterated your guidance. But maybe quantify for us what the revenues would have been, do you think, in the first quarter? And do we layer that on top of what second quarter might have been? How do we think about the cadence now as you play catch-up on that side of things?
spk04: Yeah, I think, Rick, I think the best way to look at it is, you know, we're providing a guidance range of $345 million to $365 million for the second quarter for Massimo. That basically implies, you know, that we're – a large portion of those revenues in the second quarter because we're seeing more confidence in our ability to recover the shortfall in Q1. We're also being thoughtful about, you know, supply chain challenges, just like shipping and logistics that we've experienced at the end of quarters. I think an important point I made in my prepared remarks is that for the first half of the year, our revenue range in the second quarter implies first half revenue of $649 million to $669 million for our healthcare business, which reflects 9% to 12% revenue growth on a constant currency basis. I think that's the way you should look at it.
spk06: Okay, gotcha. um joe maybe um let me turn to you and talk about sound united obviously uh i mean i think that people have been i don't know what the right word is uh confused concerned about this deal you're laying it out very clearly your vision about the future maybe help us understand from several angles What needs to be done to integrate the acquisition? Now, when do we start to see this vision unfold that you're talking about, the San United pipeline, and how and when, you know, we're going to see that truly contribute to growth? I don't know how to say it clearer.
spk03: No, no, you're great, Rick. One, from everything that I have seen and the feedback I've gotten, both teams, Massimo and Sound United teams, are really excited about this acquisition. Everyone's working really well together. The engineering team at Sound United is excited about the combined projects that we are doing, and so is the Massimo team. We've already kicked off a few product road maps and product development together which we hope to begin seeing coming to the market in 2023 in addition we are working on a very long-term path of ensuring the vision that we have ultimately comes to fruition for the combined companies in both the telehealth home monitoring, consumer health care, as well as the home side of things. As far as when you will see the revenue impact of this combination beyond what they each are doing on their own, I think it will be 2023. But already, we're getting the benefit of the team at Sound United to think through the launch of W1 and the other products that are coming that are derivatives of W1 in the future. So far, thumbs up all around. This is the honeymoon stage. I hope I can tell you the same thing six months and a year from now, but it feels really good.
spk05: Thank you very much.
spk03: Thank you, Rick.
spk10: Our next question comes from Jason Bedford from Raymond James. Please go ahead. Your line is open.
spk07: Hi. Good afternoon. And congrats on both managing 1Q and the close of the deal. So just a couple questions on Sound United. What's the growth rate assumed in the Sound United revenue guide of 660 to 700? Yeah.
spk04: Yeah, Jason, this is Micah. What's implied in our guidance, and we can't really give the pro forma numbers yet. We're hoping to provide those very soon as far as what last year's results were. The team at Sound United is still working through their year-end audit, and they closed their financial year on a different fiscal year than us. They closed on March 31st as opposed to our fiscal year ending in December. So they just recently closed the financials for the year. They're working through the audit. We're also working through the stub period because we closed the transaction on April 11th. So keep that in mind, that the revenue we're guiding to First Sound United, the $660 million to $700 million, is from April 11th through the end of the year. What it implies, though, in our full-year guidance is that they're about a high single-digit revenue growth. on an organic revenue growth, looking at a pro forma as well as constant currency. Keep in mind there's a lot of currency headwinds that both businesses are experiencing, but if you back that out, we're assuming high single-digit growth for the full year. Okay, great.
spk07: And I hate to ask another boring financial question, but Micah, the assumed margin for Stan United at five to seven is a bit lower than we thought coming off the fourth quarter call. I think we're thinking mid-teens. I think you did a good job of bridging the two. But are there temporary costs weighing down margin here in the near term? And I guess I'm wondering is kind of sub-10% margin the right way to think about this?
spk04: Yeah, no, I think – I think they've definitely got room to improve the operating margins. They've done a good job of actually managing margins over time. But I think the way to think about it is one thing that's kind of transitory, and depending on where currency goes, but they're getting about two percentage points of headwinds due to currency this year that they didn't have in their financials last year. So that's one piece. The other piece is we are including about 2% of their revenue for investment in co-development projects and co-commercialization projects as we try to drive the strategic initiatives of the business together. And then the other 4%, if you were trying to walk back to that, you know, you're probably assuming kind of a 13% to 14%. EBITDA number, is they have about 4% of depreciation, amortization, and now share-based compensation in that number as well. So that should work. Thank you.
spk06: You're welcome.
spk10: Our next question comes from Jason Bednar from Piper Sandler. Please go ahead. Your line is open.
spk05: Hey, good afternoon. Thanks for taking the questions here. I wanted to start with coming back to a couple of the topical issues here at hand, supply chain dynamics and then Sound United for my follow-up. But starting with the supply chain, you know, the hiccups have risen here for a lot of manufacturers here the last several months, both in terms of sourcing product needed and then getting finished goods to where they need to be. So I appreciate the updated views here at the outset of today's call, but wondering what's the level of risk we should be considering and running into a similar situation, supply chain challenge going forward, be it for Massimo or Sound United? And then is there any color you can talk about or confidence you can give here to ensure that the issues that hit here in the first quarter don't repeat?
spk03: Well, We thought we were immune to it. As many, many companies over the past couple of years complained about supply chain, we had always been able to mitigate them. So I guess once bitten twice is shy. I can't guarantee you we won't have a problem again since we had one that we couldn't have predicted before. What I can tell you is there was a myriad of issues from labor issues shortage, component shortage, to last minute Shanghai lockdown, and shipment problems. So we believe at this point, as I said earlier in our prepared remarks, we have all the components we need to not only fulfill what we couldn't ship at the end of Q1, but what we expect to do in Q2 with the range that Micah provided. So really, the only thing that could go wrong now is shipments, shipment delays. We are reaching out to our customers that normally want their shipment towards the end of the quarter to see if they'll take it earlier so that we hopefully don't end the quarter with any potential problems. We're doing everything we can. The one thing I'll tell you, on the labor shortage, we've gone a little overboard. Not only are we making everything we need, as I said earlier, we pretty much have caught up with all of the purchase orders that we had. But we're not shipping safety stock. We're not making, excuse me, safety stock, and much more than we had previously planned to, just to make sure we can weather any hiccups. So all I can tell you, we really have a wonderful team, and they've done everything, and they're doing everything. But unfortunately, there's no guarantee.
spk05: Okay. All right. No, that's helpful. And maybe just for the follow-up here on Sign United, Joe or Mike, just, you know, bigger picture, thinking about the go-forward strategy here. I know we'll hear more at the Investor Day in September, but again, I wonder if there's anything here you can discuss, you know, but rather than having us all wait for four months, just like what are the near to intermediate term plans in consumer beyond the recent W1 announcement? And here I'd really just be curious how you plan to move forward with establishing a consumer brand, you know, what other infrastructure investments might be necessary to have a proper platform to build from, and then anything you'd be willing to share on additional pipeline items beyond the watch and the hearing aids that you've highlighted already. Thank you.
spk03: Well, I think Mike or I both can take this one. Bottom line is we've bought Sound United for several reasons. I think I articulated that during our prepared remarks. One of them is their management team and their ability to think through consumer sales, advertisement, logistics. Secondly, their very strong distribution channel, which is over 20,000 distribution points with strong relations that have been built over decades. So we expect to use that. We're also discussing additional novel approaches to add to what they've been doing, which we will share with you later as we announce them. So a big reason for this acquisition is our conclusion that we have some really incredible products coming out without an incredible A distribution channel and team. And as we tried over the last few years as we were preparing for the launch of W1 and other products, we tried to build that up organically. We had not succeeded to the level that we thought would fulfill our plans. So they are our plans. And we have additional things we're brainstorming with them, but that's really the plan.
spk05: All right. Thank you. Thank you.
spk10: Our next question comes from Michael Polark from Wolf Research. Please go ahead. Your line is open.
spk05: Good afternoon. Thanks for taking the questions. I'm going to ask another one on the strategic direction and frame it maybe a little bit differently. The question is this. Did the investment community's response to the Sound United transaction surprise you? And, you know, in the context of a billion-dollar investment to purchase the asset and, you know, the market has voted by, you know, reducing your, you know, enterprise value by six or seven billion dollars, did the alarmingly high spread and so you know I just wonder did that surprise you and if it did has it you know catalyzed perhaps a rethink of maybe the best way forward with the consumer strategy and if there might be a different way to prosecute this vision yeah it definitely surprised me I couldn't have imagined the way
spk03: some of the investors reacted because, look, I don't know why people want to invest in Massimo or why they don't, but if people got out because of the Sound United, that was really a bad decision because Sound United helps our plans for the future. And we didn't mortgage much to gain that assurance for our future. So, yeah, no, the investor's reaction is a big surprise, but it doesn't at all, not at all, change our thinking about the reason we did it and our – conclusions that this was a great acquisition. As of this point, we told you before, if things don't work out, you make decisions, you can go forward, but sometimes you can be wrong. If it doesn't work out, we'll let you know. But this is really, at this point, what we think is the best thing we could have done. And, you know, I've got to tell you, maybe I'm old-fashioned, but I thought the business's job was to try to figure out what your customers want in products and services and provide that to them in an ethical fashion, improve your cash flow, and improve your chances of survival in the future. That's what the Sound United acquisition does for us. And people who don't see that, I'm not one to judge them, but I hope we'll prove them wrong.
spk05: Fair and full response. I appreciate that. If I could drill into the weeds of the quarter with one or two follow-ups, I'd appreciate it. Micah, perhaps for you, the board and monitor shipment number looked to be solid and up sequentially and in the zone of expectations, but the revenue missed. And so maybe it's just me and not everyone else, but I'm just trying to bridge the variance there. How did the shipment number get there? But the revenue falls short.
spk04: Yeah, Michael, the answer there is really our overall driver shipments were strong, as you see from the number. And that's really driven by the amount of technology boards that we were able to get out due to the strong demand. As far as our Massimo branded equipment, that was kind of tied up with some of those supply chain and logistics challenges we had in the quarter. So our driver shipments would have been stronger in the first quarter had we been able to ship all those Massimo branded drivers. I think that that's where you're going to see, and we've got, you know, more and more confidence of that 300,000, at least shipping 300,000 this year for the rest of the year. So, you know, I think that's the floor now, and that's what we're driving to, and I think you'll see strong shipments each quarter for the rest of the year as we start to recover on some of that Massimo-branded equipment.
spk05: Got it. So the shipments would have been higher. That's a good reply. Good color. Thank you. And last one. Look, I need to do work on the consumer wearables marketplace, clearly. I was walking around Best Buy last weekend and hadn't been there in seven years. So it was... I had to orient. Where will W1 fall in the U.S. market from a selling price perspective? Is there any color you can provide? I saw the release yesterday that the pilot users get access to the device for half off, and that will be coming up here in the next quarter or two. But as you roll this out in a fuller commercial launch perhaps next year, how will the price point compare to some of the other products on the market?
spk03: The W1 will probably be in the market at $500 with services that people can sign up for monthly or annual agreements. And as far as where it lands in the market, it is the only continuous and accurate pulse oximetry with many other features that will come, that will announce after the limited market release date. So we think it's priced just right.
spk05: Thanks for taking the questions.
spk03: Thank you.
spk10: As a reminder, if you'd like to ask a question, please press star followed by the number one on your telephone keypad. Our next question comes from Marie Thibault from BTIG. Please go ahead. Your line is open.
spk09: Hi, good evening. I did want to hear a little bit more about the augmented hearing device. You can tell me if we need to wait until September, but I'd love to hear a little bit more about what that will be capable of. Is this a hearing aid or is this something more that you're envisioning?
spk03: Well, we have to be, you know, first of all, we believe we will have the ability to help people experience sounds better. There might be an RX version for it for over-the-counter that will get FDA clearance that will be marked for hearing enhancement, and there might be ones that are marketed as best sound possible for individuals that will not be making claims about hearing improvements.
spk09: Okay, that's clear enough. We'll look forward to hearing some timelines on that. I'll ask my follow-up here away from Sound United. We'd love to hear an update sort of on the litigation front, the patent front. I don't know how much you can tell me, but we've been certainly following the Interparts review and some of the back and forth on the lawsuit. So we'd love to hear the latest or just anything factual you can tell us on the lawsuit as well as the International Trade Commission.
spk03: Well, on the International Trade Commission case, we're going to go to trial in June, and we expect to have a decision in September with the final resolution in January of next year. The patents that we have in that case we believe are great patents and spot on, so we feel really good about our ITC case. And then on the On the district court, which is supposed to retrial in March, we have a trade secret case. As you know, the patent case got stayed when Apple filed the inter-party re-exam on our patents. A couple of the key patents in that case have been allowed by IPR, so they may get added to the trade secret case, or they may go through a third case, third trial. But so far, we feel really good about our cases and hopefully lots of good news to share in the future.
spk08: All right. Very helpful, Joe. Thank you and appreciate taking the question.
spk03: Thank you. I think we're done for the day. We appreciate you all attending and being on the call. Our analysts are welcome to take part in the limited market release of W1 as long as you agree to our rules so that you can learn hopefully more about what we're doing. So thank you all, and we look forward to our next call.
spk10: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.
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