PLAYSTUDIOS, Inc.

Good afternoon, everyone, and welcome to the Play Studios first quarter 2024 earnings call. At this time, all participants are in a listen-only mode. A question and answer session and instructions will be given at that time. As a reminder, this conference is being recorded. I would now like to turn the call over to Samir Jain, Head of Investor Relations and Treasury. Mr. Jain, you may begin.

Thank you, Operator. Good afternoon and thank you for joining us for Play Studio's first quarter 2024 earnings call. Joining me on the call today are our Chairman and CEO, Andrew Paschal, and our CFO, Scott Peterson. Before we begin, let me remind you that during the course of this call, we will make forward-looking statements. These statements are based on our current expectations and beliefs and are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to our SEC filings for discussion of the risks and uncertainties that may affect our future results. I would like to remind everyone that we will discuss certain non-GAAP financial measures during this call. These measures should not be considered as a substitute for financial results prepared in accordance with GAAP. Our results are prepared in accordance with GAAP and a reconciliation to comparable GAAP measures will be provided in our first quarter earnings release and in our SEC filings. With that, I'll pass the call to Andrew.

Thank you, Samir, and welcome, everyone, to our first quarter 2024 earnings call. As always, our commentary today is in addition to the financial disclosures we made in our press release. I encourage you to take a look at the release for a summary of our more recent performance. I'll begin with a few thoughts on the quarter and the company's outlook, after which Scott will follow up a discussion of our financials, and then we'll open the call up for your questions. Revenues and adjusted EBITDA on the quarter were ahead of consensus expectations in our own internal plans. On a year-over-year basis, and as expected, both metrics were down from year-ago levels. As I alluded to during our last call, many of our products are undergoing meaningful changes, which we expected to temper this quarter's operating performance. This was by design as we focused on building the infrastructure needed to revitalize these gains and position them for growth. As a quick recap, initiatives in 2024 include a portfolio-wide adoption of our updated MyVIP loyalty program, restoration of MyVegas and MyEconomy, the generalization of play awards, the launch of at least one new Tetris title, and an expansion of monetization within the Brainium portfolio. We're making notable progress on all these fronts, and I believe we're on our way to exiting the year at an improved run rate. Let's delve a bit more deeply into our Play Games business division. Overall, the results in Play Games continue to benefit from momentum in our growth portfolio. Tetris was, again, the standout as its revenue and DAU were well ahead of year-ago figures. High levels of organic traffic were amplified by the recent fascination with Willis Gibson, the 13-year-old Tetris player who became the first person to defeat the game. The global reaction that ensued reaffirmed our belief in this beloved franchise and our plans for tapping its unrealized potential on mobile platforms. With this in mind, our Tetris Prime team has been working hard on refreshing the look and feel of the existing game, elevating its creative execution to the standards that are more consistent with the rest of our portfolio. Our goal is to have this new version ready for Tetris' 40th anniversary in June. We also plan to complement this core Tetris title with at least one new casual variant later this year, likely in the third quarter. With the mobile license in place for the foreseeable future, our long-term ambition is to establish Tetris as a premier mobile gaming brand. It's also worth noting that we continue to enjoy solid momentum from our Braemium portfolio, which helped this quarter's results. We've been introducing new ad units and optimizing fill rates, which has driven an uptick in monetization. We're expecting further improvements as we introduce rewarded video and complete the integration of a MyVIP program. A unified and consistent execution of our loyalty solution across all of our primary titles is a top priority for us and something we're committed to accomplishing in the coming months. Our core portfolio is generally trending in line with the broader social casino industry, which continues to be challenged. We expect this to be the case throughout 2024, so we don't anticipate the industry's rebounding this year. As a result, our focus remains on refining our technology tools and operating capabilities, which should position us well when the market dynamics improve. With that said, our top priority is to better leverage our learnings across our collection of social casino titles. In support of this, we transitioned our MyVegas and MyEconomy games to Tel Aviv and are deep into the process of updating the games and improving our operations. This has been an ambitious undertaking, which was further complicated by the conflict in Israel. But we're making good progress, which is reflected in the more recent pickup in daily conversion rates. We're also working on increasing our direct-to-consumer business, which is largely nascent today. The primary focus is to more effectively leverage our MyVAP.co player portals with our active monetizers. The use of our loyalty program as a primary driver of direct business presents us with a differentiated strategy. Over time, I believe this will allow us to grow our direct sales and further improve our margins. Turning to Play Awards, we continue to focus on two key themes. One, fortifying our industry-leading platform by advancing its technologies and adding new players and rewards partners. And two, generalizing the platform for external use. Third-party game publishers remain interested in our unique offering, and we continue to qualify our best to structure a partnership. We expect these conversations to continue throughout the coming quarters with the goal of formalizing a pilot relationship before the end of the year. As these partnerships mature, we believe we can evolve Play Awards from a cost center to a revenue-generating, loyalty-as-a-service business. Before turning the call to Scott, I want to discuss our capital position and plans for investing our available cash. We restarted our share repurchase program in the first quarter and have bought an additional 4 million of stocks to date. We view our share prices deeply discounted and believe buying back our own stock rates value for all shareholders. At the same time, we remain committed to identifying and completing transformative M&A transactions. We continue to actively search for compelling opportunities that are in keeping with our overall strategy and expansion plans. Our goal remains to use our capital to enhance our strategic position, drive incremental growth, and increase the value of our company. I'll now turn the call over to Scott to provide some additional comments. Scott? Thanks, Andrew. Good afternoon, everyone. In addition to today's press release, our Form 10-Q will be filed shortly. Please look to those filings for a comprehensive summary of our first quarter results. We started the year strong with quarterly net revenues and consolidated adjusted EBITDA ahead of consensus expectations. First quarter consolidated adjusted EBITDA of $15.3 million was 14% lower than a year ago, while net revenues of $77.8 million were 3% lower. As a reminder, the first half of 2023 results include the benefit of a licensing agreement that ended later in the year. Adjusting for the impact of this agreement, first quarter consolidated adjusted EBITDA and net revenues would have been roughly flat with last year's amounts. As mentioned on our last call, we are anticipating building strength throughout the year. This is due to the numerous initiatives underway that will layer into our results sequentially. DAU was 3.5 million and MAU was 14.8 million, down 2% and up 13% respectively from last year. MAU increased due to the Tetris activity related to the Willis-Gibson exposure of beating the game. However, Tetris DAU increased over the quarter at a more modest rate. DAU declined in total, primarily through the core portfolio of our social casino games, partially offset by the Tetris increase. Barped out for the quarter was 24 cents, flat with year-ago results. Noble here were the double-digit gains in MyVegas, MyKanami, and Branium. Turning to Play Awards, we continue to make progress expanding the functionality and scope of the platform. We closed the quarter with 521 available rewards and 113 reward partners. Over 500,000 rewards were purchased in the quarter, a 14% increase from a year ago. We remain focused on a full integration of Play Awards and MyVIP into our games and continue to seek out opportunities to externalize the platform. We ended the quarter with approximately $127 million in cash, no borrowings, and full availability of our $81 million revolver. As Andrew mentioned, we resumed repurchasing our shares during the quarter and have bought an additional $4 million of stock through today. As such, we have $46 million remaining on our share repurchase authorization and continue to view share buybacks as an accretive and compelling use of our capital. In addition to repurchases, our broader capital allocation goals remain the same. investing in our games, building and scaling play awards, and the pursuit of strategic and accretive M&A. Our 2024 financial guidance remains the same, revenues in the range of $315 and $325 million, and consolidated adjusted EBITDA between $65 and $70 million. I'll now turn the call back to Andrew for some closing remarks. Thanks, Scott. Before we end our prepared remarks and open the call for questions, I'd like to touch on a few highlights. We had a strong quarter with revenue and adjusted EBITDA above our end street expectations. We remain on track to meet our full year earnings guidance, which calls for positive sales earnings growth this year. Changes at MyDegas and MyEconomy are in process and we're encouraged with the progress. We believe both games have the potential to meaningfully improve monetization this year. We remain on track to a full integration of our updated loyalty solution into all of our games by year end. In addition to better game metrics, we expect the integration of MyDAP.co to drive higher direct sales. Cranium's results are showing sequential strength on the back of expanded advertising efforts. We look for continued momentum through the year. Tetris continues to grow materially and is positioned for a strong 2024. Two new Tetris games are in development with the goal of launching one later this year. We continue to explore ways to open play awards to external platforms. Conversations with third parties continue and remain confident the Play Awards can evolve into a profitable standalone business. Finally, we restarted our share repurchase program this quarter, and we continue to believe our stock is trading well below fair value and represents tremendous value. With that, I'll turn it over to the operator. Operator, please open the line for questions.

Thank you. And ladies and gentlemen, at this time, we will conduct our question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove yourself from the question queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we pull for questions. Our first question comes from Ryan Sigdahl with Craig Hallam Capital Group. Please state your question.

Hey, good afternoon, guys. Hey, Ryan. I want to start with the Play Awards. What was the royalty revenue last year? Just can you remind me what it exactly was and why it didn't repeat? And then talk through the pipeline of the B2B opportunities and licensing opportunity for Play Awards. And then kind of lastly, along with that, When should we expect for the segment to inflect to profitability and self-sustaining?

Thanks, Ryan. On the first question, if you recall, last year we had a relationship with a technology provider related to a suite of blockchain technologies that we were going to incorporate into our platform company called Forte. So we had a licensing agreement in place with them. where we were making use of their technology and in turn they were licensing from us some of our intellectual property and certain rights to leverage a bunch of the work that we had done in the play awards space. So that expired towards the end of the year and that's why that's not a non-recurring revenue line item. On the B2B efforts, I mean, as I alluded to in our remarks, I mean, we've had a bunch of conversations, and these are dating back to last year with a number of different game publishers just to qualify the overall opportunity. And we've taken on a lot of the feedback that we received and continue to invest in evolving our platform and tools in response to some of that feedback. And we have active conversations that are still ongoing, which is why we've kind of established an expectation that before the end of the year, we'll have, we believe, our first pilot program in place And then based upon the performance and success of that program, we'll converge on what ultimately will be our commercial model and resolve how it is that will scale that business. So the third question is to when it would turn profitable. We can't really provide any indication, but it's certainly not assumed to impact this year's performance. And we'll certainly provide a bit more visibility and guidance once we have it ourselves.

Helpful. Thanks, Andrew. Just a follow-up on the exchange with Forte. Was that effectively a zero margin, zero EBIT then since you were exchanging technology for technology effectively?

No, it was a high margin opportunity. I mean, we received compensation and consideration for licensing and for the use of select IP, and so it was high margin.

Gotcha. I didn't know if you were paying back to them for their technology, but it makes sense. Moving along to Tetris, it looks like one of the Tetris games is live in Canada. Another one says coming soon in the U.S. But can you elaborate on which one of those you expect in Q3? And then any more comments on the game variants and who the targeted audience for these Tetris games will be?

Sure. Well, so we're really excited, obviously, about Tetris as a franchise. You might not know that in June, it'll be the 40th anniversary of Tetris. And so we're obviously looking forward to the elevated kind of interest that Tetris will likely have. And we're going to take advantage of that and be a part of all the campaigns and celebrating the 40th anniversary. A big part of that will be the refresh and revamp of our existing Tetris Prime product. So that's been ongoing and That'll be live in the June timeframe. As far as the new Tetris products are concerned, we have two casual Tetris products that have been in development for over a year now. Both are continuing to advance. We've indicated fully expecting one of them will launch this year. We're not quite ready to identify and start speaking to which of the two we're going to launch with, but suffice to say we're feeling pretty comfortable about the progress the teams are making. And as far as the target audience, it's a broader, more casual audience. A lot of the people that are finding and playing Tetris today tend to be more of the purists. And we believe that there's a very big audience out there that would love to play Tetris on a mobile device. The experience of it is a little bit different. Mobile games, obviously, have evolved quite a bit since the first introduction of Tetris as a game format. And so we think that a bit of a hybrid, games that take advantage of really proven puzzle block mechanics along with some of the other meta features that you see in the most popular casual games will make for a more interesting and accessible game for a much bigger audience. So that's our focus in terms of the consumers we're targeting.

Very good. Thank you. Good luck.

Thank you so much, Ryan.

Our next question comes from Aaron Lee with Macquarie. Please state your question.

Hey, good afternoon, guys. Thanks for taking my question. So you guys saw a nice uptick in rewards purchases this quarter, obviously, both in the number of units and the retail value. Is there anything to unpack there just in terms of the driver of that and anything you can comment on in terms of initiatives to move these metrics higher ahead of your loyalty platform commercialization? Thanks.

Yeah, no, thanks for the question. You know, the rewards for temptions are pretty well distributed. The team's done a great job continuing to optimize the portfolio of rewards that we offer. We find that our players really enjoy a lot of the events that we conduct. So the types of activities and events where people can go en masse and participate in an experience like My Vegas at Sea. And so we're looking at, stepping up our efforts around some of the proprietary things that we're doing along the events dimension. So we have a big initiative that we're going to be launching called the World Tournament of Slots, which we're effectively going to crown the world's best slot player. And that'll be across our entire portfolio. We have a whole series of tournaments that'll take place in-game and let people qualify for a destination-based live event that'll host a large audience number of our players. So that gives you a hint into where it is that we're seeing a lot of opportunity, but, um, you know, across all the various categories, we continue to see really good momentum. So it's nice to see that the redemptions are pretty diversified.

Great. That's interesting. Um, and then just a quick followup, just with regard to your guidance, which you've maintained, um, Just given that the quarter came in above expectations, has anything changed in terms of how you're thinking about the cadence of the quarters or the waiting to the back half of the year? Thank you.

Yeah, no, thanks for the question. You know, we think that the first quarters historically, you know, tend to be a stronger quarter. And in light of just still some of the lack of predictability and stability in the casino category or genre, We're not in a position yet where we're going to adjust our outlook. So, we feel comfortable with where we are at the moment.

Okay, great. That makes sense. Thank you very much.

Cool. Thanks a lot, Aaron.

And our next question comes from David Pang with Stifel. Please state your question.

Oh, thanks. So, just to follow up on one of the earlier questions. In your conversations with potential external game publishers for Play Awards, what is the biggest source of friction or pushback you're hearing from them?

I think that, first of all, I think the universally positive feedback we received was that people recognize how unique the whole value proposition of our loyalty program is. not only having a tiered loyalty structure with all kinds of digital rewards and benefits, but also the real-world tie-ins that we provide. A lot of the feedback that we received that was constructive was around the effort and time that would be required in order to integrate a program into their product or suite of products. And as you can imagine, games that have meaningful scale and momentum have dedicated teams and roadmaps with features and new content that they plan to introduce and so to actually find room for and make development capacity available to incorporate something as substantial as a loyalty program is a meaningful commitment and so they they pushed pretty hard and wanted to understand a lot more about our sdks and kind of the integration approach and tools and and support that we can provide just to ensure that the amount of time and effort that's required in order to implement the program would be more predictable and obviously then translate to the benefits that we've enjoyed and that we believe they too can enjoy. So it's really around the amount of effort and energy that's required to implement a really well executed loyalty program within their own products. And as a highlight, we've made really great progress there in terms of making the whole exercise a lot more efficient and creating lots of tools, tons of reference documentation. So all the things that would be typical of productizing something that you would otherwise just use for yourselves.

Got it. That's really helpful. And then just one on the marketing environment. Can you provide an update on the mobile marketing environment and what What are the platform policy changes? How is that affecting your thoughts on new game launches?

Well, look, I mean, obviously a lot has been made of all of the privacy policy changes that the platforms have instituted and how that's translated to the tools they provide and the restrictions that they've imposed and it makes targeting consumers and scaling and building an audience challenging, more challenging than ever. And those policies continue to get, if anything, ever narrower. With that said, I think that if you have a successful game and certainly a franchise brand like we have in Tetris, you generate a tremendous amount of just organic traffic and interest. Our Tetris product generates well over 22 million organic installs a year. So we believe that while the environment is certainly very challenging, that there's an opportunity with the right types of products and franchise brands to rise above the noise and overcome a lot of these restrictions and build a meaningful audience. And so if you really look at our portfolio of products, They're either based on really well-established and beloved brands, whether that's all of the very popular Las Vegas brands for our casino portfolio, whether it's Tetris in the casual category, or they're games that have at least 10 years of history and where they demonstrated their durability and the resilience of their audience. So we're very keen and very clear about The complexities of UA, and so as we continue to invest in our own products, those are some of the things that we consider.

Okay. Thank you.

And our next question comes from Greg Gibas with Northland Securities. Please state your questions.

Hey, good afternoon. Thanks for taking the questions. I'm curious if you could kind of attribute or what kind of drove the outperformance relative to your expectations in the quarter? I imagine Tetris was a key one, but just kind of curious how you'd attribute the outperformance.

I mean, I think generally speaking, I think that the portfolio products performed as expected. Tetris definitely was a bit of an outlier. And that was driven by, you know, some of the residual impact of the Willis Gibson effect, which I alluded to earlier. So for the first time, Tetris was defeated, and it just became a bit of a social phenomenon. And we saw a pretty meaningful spike in installs and engagement and the level of interest in that product. But we've also seen pretty healthy performance momentum with our Branium suite of casual products. And then within the casino portfolio, we're pretty happy with some of the momentum that we're seeing with our MyVegas product, where a lot of things that we've been working on seem to be translating. So those are some of the highlights.

Great. That's helpful. And, you know, regarding the kind of spike in Tetris, it makes a lot of sense regarding how much of it's in the news. You almost couldn't avoid it. But You know, is that interest kind of showing momentum beyond, you know, when it occurs? Like, are you still seeing kind of elevated gameplay there or interest? Just curious if that momentum is kind of carried into K2.

Well, there's – I would say if you look at the current kind of normalized state and pace of that product relative to where it was before Willis-Gibson and the resulting kind of social phenomenon – It's definitely stepped up, but it's regressed a little bit from its peak, which is to be expected.

Fair enough. Great. I know you provided some comments on it, but any more that you can provide us on the more of an update on the M&A search and how that's maybe been trending this year?

You know what? I think we've got Jason on the call. I'll let him kind of speak to maybe provide a general update. No, we can't be too specific. But Jason, you want to provide some highlights?

Yeah, we remain committed around our M&A strategy. There's a lot of opportunities out there in the market. We have an active pipeline of companies that we continue to engage with on the M&A side. As you know, it's a Getting these M&A deals over the line is complex. We need to structure deals that are accretive to our financial profile, both growth and margin, and they also need to be strategically compelling and timed right at the right time when we're able to transact upon them.

So we don't have anything at the moment that's closing right now that we can announce, but we're engaged in deep conversations with very exciting opportunities.

Sounds good. Thank you.

Yeah, thank you, Greg. Thank you, and a reminder to the audience, if you'd like to ask a question, press star one on your telephone, or press star two to remove yourself from the queue. Our next question comes from Martin Yang with Oppenheimer and Company. Please state your question.

Hi, good afternoon. Thank you for taking my question. First question for Andrew, can you share with us what your high-level thoughts on the prerequisites for social casino as a genre to recover? You know, anything you could point to either, you know, internal, external, that would be helpful. Thank you.

Hey, Martin. Thank you. I mean, that's a good question. I think that the casino genre continues to, I think, command a lot of interest. It's over time gotten increasingly more competitive, and I would say more recently it's come under maybe not so much pressure, but the areas of growth and opportunity have shifted into different types of commercial models. So, you know, our general feeling is that, you know, we've got a pretty large audience of engaged players that love this form of content. And as we look at some of our peers, we see that there's still opportunities to actually scale and grow audience, although that's become more challenging. So, you know, I think for us it's really about looking at different commercial opportunities, ways to monetize more of our existing audience, the direct-to-consumer opportunities, which for us were, I would say, behind the market as far as the momentum, and yet we have some really compelling unique assets in order to compel our existing players to purchase with us direct in our platform. So I think the momentum that we'll continue to see as we convert more players direct to purchase and as we look to test and try different commercial models, I think that'll change some of the underlying economics of our products, which will then in turn allow us to invest more aggressively in acquiring and scaling up the audience again. So I would assume the same is true for a lot of our peers.

Thank you. My next question is about Tetris. So around June, in time for the 40-year anniversary, is there any other external events, large market campaigns that you should maybe point us to to watch for potential industry-wide re-engagement or events that will drive new players to all things Tetris, including your game?

Yeah, that's a great question. You know, my co-founder, Katie Boles, who is responsible for our new game development in the Tetris franchise, I believe is also on the call. Maybe I'll let her take that question.

Sure. Hi. Yeah, no, we've got a number of campaigns lined up to celebrate the anniversary of Tetris, starting with our Tetris rebrands. We're considering it the year of Tetris, and so we're layering in activities throughout the entire year. So we're pretty excited. We've got some activities with our Play Awards partners, and then on top of it, the Tetris company is doing a number of campaigns that should raise the profile of Tetris as well. So we're very excited for the Tetris anniversary, and we expect people to be talking about it.

Thank you very much. That's all for me.

Thanks, Martin.

Thanks, Katie. Thank you. Our next question comes from Clark Lampin with BTIG. Please state your question.

Thanks for taking the question. I just kind of wanted to follow up on that last, I guess, sort of topic of social casino market dynamics. And just to be clear, if we were to imagine that I guess the market, you know, backdrop for mobile as a whole was improving, Is your view that social casino, I guess, is sort of, you know, as a subsegment of that, more of a steadier entity that if the market, I guess, is sort of ebbing and flowing up and down, that social casino patterns are going to be a little bit more muted and maybe there is less of a, I guess, potential sort of rising tide lifts all boats dynamic with that piece of the market? Or is that kind of the wrong, I guess, takeaway here?

I mean, I think that's generally the prevailing view. I mean, if you look at the forecasts for social casino, well, if you look at the last several years and its trends, it's generally been flat and it's actually compressed a little bit a couple years ago and it's just in the last year been flat to down slightly. I think the forecasts going forward are for it to generally be fairly stagnant. So, you know, nobody that's kind of been following the various companies and market trends, sees that there's a catalyst for driving any real meaningful growth. You know, for us, you know, we still look at the category as being very significant. It's a $7 billion, you know, plus market category. And we believe that our products continue to differentiate themselves. We've got games and brands and mechanics and and features within our products that we think really distinguish them from everything else. And there's a lot more that we can do in order to monetize our existing audience, which will then start to change the unit economics around what we can afford to spend to acquire new users in order to start driving growth. And so that's why I maybe didn't explain all that clearly, that I think as we improve the monetization of our existing products, that's going to change the dynamics of how much we can continue to invest in both stabilizing our existing audience or starting to grow it again. And we believe that's possible, but not in the absence of improving the overall, you know, ratio between the cost of acquiring users relative to their returns.

Got it. I guess as we... That's helpful. If we think about, I guess, sort of the confluence of those factors between sort of market dynamics and a push towards monetization and, you know, some other things, I guess kind of on top of that, what does that translate to for DAU growth, I guess? I know it's not an item that you guys explicitly sort of guide to over the balance of the year, but if we were to think about sequential patterns of growth from here, Is there, you know, sort of directional commentary that you guys could provide for us?

Yeah, I mean, I would invite any of my colleagues to weigh in if they have other insights they want to share on this question. My view is that, you know, DAU growth going forward is going to be driven more by new products that we introduce into the market. We see the potential certainly within some of our existing products like Tetris, as we've talked about, that enjoy tremendous organic growth or interest, I should say, that really the bigger opportunity is around both retaining the existing audience that we have and monetizing it to a greater extent. And we believe that there are opportunities, pretty significant opportunities for us to meaningfully increase and improve the monetization across our core casino portfolio and even some of the casual products. And I would say that what's unique about our model in the way that we put our loyalty program is that more than most any other company, we've got a really unique value proposition and set of features that's focused on retaining our audience. So where a lot of our peers have seen far more severe contraction of their audience, we believe our loyalty program allows us to hold on to that audience, affording us more time and opportunity to engage them and get them to convert and start spending money. And so that's our primary focus. So, you know, converting more of our existing audience and driving revenue in and among our retained and engaged players will drive the top line growth of our business, which we should start to see more flow through and margin expansion as a result. And then as we launch some of these new products that we've talked about, we're going to leverage those to actually attract and acquire new players into our network. And then, of course, once we incorporate the loyalty program and we can then cross-promote, you know, from one product across the portfolio of other games and enjoy some of the network effects that we'd expect. Thank you, Andrew. Yeah, thanks.

Thank you, and there are no further questions at this time. I'll hand the floor back to management for closing remarks. Thank you.

Well, thank you. I just want to thank everybody for your continued interest and support. We look forward to checking in and providing further updates in a quarter.

Thank you. And with that, we conclude today's call. All parties may disconnect. Have a good day.