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spk07: Good afternoon. Welcome to Noggin Inc's fourth quarter and full year 2022 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. As a reminder, this call is being recorded. Joining us today from Noggin are Jonathan Huberman, President and CEO, and Shariar Ramadi, COO and CFO. Before we begin, Noggin's management team would like to remind everyone that statements made and or answers that may be given to questions asked on this call are or may contain forward-looking statements that are subject to risks and uncertainties related to future events and or the future financial or business performance of Noggin. Actual results could differ materially from those anticipated in these forward-looking statements. Forward-looking statements include but are not limited to Noggin's expectations or predictions of financial and business performance and conditions, the development and adoption of Noggin's platform, and cost reduction measures, as well as competitive and industry outlook. Forward-looking statements are subject to risks, uncertainties, and assumptions, and they are not guarantees of performance. Noggin is not under any obligation to and expressly disclaims any obligation to update, alter, or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, a description of some of the risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements on this call can be found in the risk factor section of our full year report on the form 10-K for the quarter ended December 31st, 2022 to be filed with the SEC later today and in our other filings with the SEC. On today's call, we will also refer to certain non-GAAP measures, including non-GAAP revenue and adjusted EBITDA that we view as important in assessing the performance of our business. These metrics exclude certain items as discussed in the release under the heading non-GAAP financial measures. Therefore, these measures should not be considered in isolation or as an alternative to operating income, net income, cash flows from operations or any other profitability, liquidity, or performance measures derived in accordance with GAAP. You should be aware that the company's presentation of these measures may not be comparable to similarly titled measures used by other companies. A reconciliation of each non-GAAP measure to the comparable GAAP measure is available in our earnings release and our full year report on Form 10-K for the quarter ended December 31st, 2022 on Noggin Investor Relations page at www.ir.noggin.com. Finally, I would like to remind everyone that a webcast replay of this call will be available via the link provided in today's earnings release, as well as on our website at www.noggin.com. Now, I'd like to turn the call over to Noggin CEO, Jonathan Huberman.
spk02: Thank you, Amy. Welcome, everyone, and thank you for joining us this afternoon on our earnings call. To begin today's discussion, I'd like to provide a quick overview of our business and review last year's highlights before turning the call over to our COO and CFO, Shari Arumadi, to discuss our financial results for the quarter and year. After that, I'll share some closing remarks before opening the call for questions. For those of you who may be new to our story, at Noggin, we believe that as retail e-commerce continues to grow and becomes more sophisticated, there is a large market opportunity to help merchants who need that e-commerce sophistication but lack the expertise, capital, and personnel to manage it at all. Noggin's commerce as a service platform satisfies this need in a few ways. First, Noggin provides a headless end-to-end technology platform that merchants can plug into instead of paying to integrate multiple technologies. Second, Noggin delivers advanced capabilities that are generally too complex and costly for many brands to buy, build, or manage on their own. These capabilities include a full customer data platform, social commerce abilities, and AI integrations. Third, Noggin includes leading edge R&D and innovation as a service so that clients are never required to expend resources on their e-commerce operations. Further, Noggin eliminates the need to re-platform because as we build these new features and tools, they're immediately available to our clients. And lastly, Noggin drives identifiable incremental performance for our customers based on insights from our proprietary data asset, insights unavailable to most outside of the Noggin platform. Noggin's business model includes taking a percentage of brand e-commerce sales conducted through our CAS platform, which ensures complete alignment between ourselves and our clients. Our growth strategy is rooted in three key pillars. develop and continuously advance our innovative and scalable commerce as a service platform, increase sales and marketing efforts to drive our pipeline, and expand our client base into new markets and products throughout e-commerce. We continue to make progress on all these fronts as we look to the rest of 2023. Altogether, as we grow and continue to scale our product and service offerings, our clients' e-commerce operations can scale in parallel. Our modern approach to commerce allows brands and sellers to grow more profitably and without upfront costs while still focusing their efforts on their core business instead of the resource-intensive nuances of e-commerce. I would now like to take a few minutes to reflect on our 2022 fiscal year. In many ways, this year was transformational for our business. After completing our business combination to enter the public markets in August, we added public company and industry expertise to our management team and board of directors to best position Naga to execute on our growth strategy. Also, a major driver of our decision to go public was to enhance our sales engine, and with that in mind, we made significant investments last year to bolster our sales force. These efforts have led to strong customer acquisition momentum, as well as a robust pipeline of additional brands that are interested in Noggin's capabilities. Expanding our client base remains an important part of our growth strategy, and we look forward to further driving our sales engine in 2023. We continue to invest behind our best-in-class Intelligent Commerce platform and made significant upgrades to our software in 2022. These efforts culminated in the launch of V1 of Intelligent Commerce, announced this month, which builds on the previous version and offers powerful new features including first-of-its-kind AI-powered customer segmentation, algorithmic merchandising, and automated campaign optimization. Our goals? remain to provide our clients with access to cutting edge enterprise e-commerce capabilities, and we expect to continue investing in our technology suite moving forward. Another area of focus for us in the back half of 2022 was our comprehensive cost reduction and performance improvement initiatives. While we work to position our CAS business for growth and margin expansion, profitable operations remain a crucial part of our strategy. These initiatives are already showing positive results, including an adjusted EBITDA loss reduction in the fourth quarter. As we look to the rest of 2023, we expect to bounce these efforts with our investment into Noggin's technology and sales engine and believe that we're on a path to profitable growth. In total, we expect that our efforts in 2022 will allow us to effectively execute on our growth strategy moving forward. Especially in the current economic environment, brands are searching for ways to reduce costs while driving improved results. and our platform is uniquely positioned to help our customers do just that. With Noggin, high performance and cost effectiveness are never mutually exclusive choices. We are confident in our technology, our team, and our strategy, and look forward to capitalizing on strong momentum over the rest of 2023. With that, I will turn the call over to our COO and CFO, Shariar Ramadi, to discuss our fourth quarter and full year financial results in greater detail. Shariar?
spk10: Thank you, John. Turning now to our financial results for the fourth quarter and full year ended December 31st, 2022. As noted last quarter, our net revenue includes product-related revenue that stems from two previous deals that involved sales related to first-party inventory purchases. As that inventory is sold, generated revenue appears within net revenue in our GAAP results. Our non-GAAP revenue, however, is revenue generated by the core commerce as a service platform and associated services. we typically view non-GAAP revenue as a more accurate indicator of the business and expect our GAAP and non-GAAP revenues to converge over time. GAAP net revenue in the fourth quarter of 2022 decreased 39% to 27.9 million from 46.1 million in the fourth quarter of 2021. The decrease in net revenue was primarily due to a decrease in product revenue. GAAP net revenue for the 2022 full year decreased 7% to 94.5 million from 101.3 million in the comparable year-ago period. The decrease in net revenue was primarily due to a decrease in net product revenue during the year, partially offset by an increase in net revenue from related parties. For the fourth quarter of 2022, non-GAAP revenue, a non-GAAP measurement of operating performance, decreased 16% to 22.3 million from 26.5 million in the comparable year-ago period. The decrease in non-GAAP revenue was primarily due to a decrease in CAS and marketing revenue. Non-GAAP revenue over the full year of 2022 increased 3% to $72.4 million from $70.0 million in the comparable year-ago period. The increase in non-GAAP revenue was primarily due to an increase in CAS revenue. Operating loss in the fourth quarter increased to $12.6 million compared to an operating loss of $0.9 million in the comparable year-ago period. and operating losses for the 2022 full year increased to 40.3 million, compared with an operating loss of 6.3 million in the comparable year-ago period. The increase in operating loss was primarily due to supply chain issues experienced at the end of 2021, which impacted our performance in the first half of 2022, along with a one-time write-down of bad debt and royalty expense. The expected impact of the company's cost and performance improvement program for the full year 2023 is anticipated to be between $15 million and $20 million. The management expects to have the majority of initially identified initiatives complete by the end of the first quarter of 2023. And further, we expect these activities will have achieved their full run rate impact before the end of Q2 2023. Moving to our outlook for 2023. As of today, and based on our progress year to date, we expect to drive existing customer add-on sales as well as new customer agreements, both of which will have a positive impact to revenue. Additionally, based on the initial results of our cost reduction and performance improvement program, we expect to improve our operational efficiency, increase adjusted EBITDA, and generate significantly increased operating leverage in the future. As we execute against our strategy over the course of this year, We expect to drive improved results and look forward to providing incremental updates going forward. That completes my summary. I'd now like to turn the call back over to John.
spk02: Thanks, Shariar. Here at Noggin, we remain excited about the future and confident in our ability to execute against our growth strategy moving forward. Our traditional commerce as a service business is strong, and we believe that with our expanding pipeline of business across a myriad of industries interested in our solutions, we are positioned well to profitably grow over the coming quarters. Operator, with that, please open the call for Q&A.
spk07: Thank you. At this time, we'll open the line for questions. The company requests that each participant limit their comments to one question and one follow-up. To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile a Q&A roster. And again, as a reminder to ask a question, please press star 11 on your telephone.
spk00: One moment while we compile Q&A roster. And our first question is from Samad Samani with Jefferies.
spk07: Your line is open.
spk05: Hi there. Uh, thanks for taking my question. So maybe first just John, you know, we're, we're pretty far along in the first quarter. I'm curious what you've seen, maybe from a macro perspective, whether you want to speak to kind of aggregate customer behavior or what you're seeing, um, for Noggin specifically. And then I have a follow up question.
spk02: Sure. Um, so let me touch on that in two different ways. So first let me talk about new business. New business booking is accelerating dramatically. I expect between the signings that we had last week and the ones we expect to have, again, no guarantee we're going to get them, but we're expecting to see between last week and the end of April, we should sign up as many new customers as we did in all of 2022. So I think the bookings momentum, as we sort of alluded to in the prepared remarks, is really there and accelerating. On top of it, we're in advanced discussions with one of the top 10 business process consultants in the world about partnering with them on both implementation as well as sales to go forward. Again, no guarantee we're going to get it signed, but certainly we're in advanced discussions. Hopefully it will. So we're very optimistic about the pipeline side of the business. In terms of customer dynamics, as you know, the first quarter is the seasonally weakest quarter for us, as opposed to Q4, which is the seasonally strongest for customer demand in e-commerce. So it's kind of hard to baseline whether the year is going to end up based on Q1 because it is the seasonally weakest. Certainly, as you pointed out in your note, there's a lot of uncertainty in the markets. but I expect that the weakness that may show up we don't know if it will and consumer demand should be somewhat if not completely offset all depends when we get our bookings by the new bookings momentum as you know the bookings momentum if we sign someone up in December we only see we may see none of the revenue this year but we should see all of it next year so it's part of its due to timing for this year, but certainly if I look forward, you know, as we move forward, you know, into not just 2023 but 2024, I see, you know, very healthy growth thanks to the bookings, assuming it shows up. Again, no guarantees, but the initial indications are very positive. Does that answer your question?
spk05: Yeah, and then maybe just like I guess more specifically to what you've seen so far or looking forward, Are you seeing growth in your GMB year-over-year through the first quarter? What are the guardrails, or how should we think about what your maybe shorter-term expectations are for the business, given we're almost through 1Q?
spk02: Sorry, do you want to address that?
spk10: Sure. I think we've also made some decisions as we've taken a fresh look at the business. thought about some of our customers there were some customers where you know we we prioritize profitability over revenue growth if you will and so there are certain cases in which we have customers where achieving increased year-over-year comps would have come at a negative impact to profitability and where reductions in those growth rates or maintaining year-over-year for those customers or even slight declines year-over-year for those customers was a prudent decision from a profitability and long-term perspective. That's the tact we've taken. So, yeah, I think we didn't expect, we didn't see anything we didn't expect to see in the first quarter from an overall perspective, but we did make some intentional nuanced decisions around how we ran the brands and our interactions and engagements with our customers to be mindful of profitability versus simply sales at all costs.
spk02: And then one thing to keep in mind, Samad, we have a fairly concentrated set of customers, as you know. We have a few that are somewhat uniquely positioned, let's put it that way. And so it's hard to project based on one or two of those, how the whole industry goes. If one customer of ours has a mismatch between demand and what they have in stock, that is a somewhat unique issue, not one that can be projected across all of them.
spk09: Or even the entirety of the year. Absolutely.
spk05: Understood. And then maybe just the last question for me. As you think about the the restructuring or the cost-saving initiatives. Have we largely completed that? Is there more to go? And is there consideration on maybe taking additional steps or just kind of where are we at in terms of headcount and cost-saving initiatives?
spk12: Go ahead, Shoya.
spk05: Sure.
spk10: So we've, I think that we executed the majority of those items that were labor-related in the Q4 period, in late Q4. And throughout Q1, the actions that we took were a continued benefit from efficiencies in areas such as our distribution operations, which not only lower our cost structure, but actually provide our customers with even more accelerated shipments, which, as you know, in this business is quite key. From then on forward, we took a variety of structural cost reductions in areas where we were able to achieve efficiencies, and that manifested itself in areas such as warehouse leases where we were able to concentrate our footprint and better utilize our existing facilities, even while we took on new customers and growth without needing those previously leased facilities. The manifestation of those cost reductions, which sum into the several hundred thousand dollars per month of incremental, are in process now. Some have occurred very recently. Others will continue to materialize over the course of the next 90 days. But all of them are expected to be at full run rate by the end of Q2. Now, will we find additional opportunities over the course of our daily operations? Absolutely. We're always looking for areas where we can drive further efficiency, especially in combination with efficiency that drives performance improvements in our core business. And that's the way we're thinking about running the business, just as a fundamental philosophy and methodology. So expect to see that we're very thoughtful about both the areas of savings and being smart about those and also very judicious and ROI driven in our investments.
spk01: Great. Thank you for taking my questions.
spk11: Thank you so much.
spk07: At this time, this concludes our question and answer session. And I'd like to turn the call back over to Mr. Huberman for his closing remarks.
spk02: All right. Well, thank you, everybody. I appreciate you joining and look forward to talking again in the not too distant future.
spk07: Thank you for joining us today for Noggin's fourth quarter and full year 2022 earnings conference call. You may now disconnect. you Thank you.
spk03: Thank you.
spk07: Good afternoon. Welcome to Noggin Inc's fourth quarter and full year 2022 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. As a reminder, this call is being recorded. Joining us today from Noggin are Jonathan Huberman, President and CEO, and Shariar Ramadi, COO and CFO. Before we begin, Noggin's management team would like to remind everyone that statements made and or answers that may be given to questions asked on this call are or may contain forward-looking statements that are subject to risks and uncertainties related to future events and or the future financial or business performance of Noggin. Actual results could differ materially from those anticipated in these forward-looking statements. Forward-looking statements include but are not limited to Noggin's expectations or predictions of financial and business performance and conditions, the development and adoption of Noggin's platform, and cost reduction measures, as well as competitive and industry outlook. Forward-looking statements are subject to risks, uncertainties, and assumptions, and they are not guarantees of performance. Noggin is not under any obligation to and expressly disclaims any obligation to update, alter, or otherwise revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. In addition, a description of some of the risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements on this call can be found in the risk factor section of our full-year report on the Form 10-K for the quarter ended December 31, 2022, to be filed with the SEC later today and in our other filings with the SEC. On today's call, we will also refer to certain non-GAAP measures, including non-GAAP revenue and adjusted EBITDA that we view as important in assessing the performance of our business. These metrics exclude certain items as discussed in the release under the heading non-GAAP financial measures. Therefore, these measures should not be considered in isolation or as an alternative to operating income, net income, cash flows from operations or any other profitability, liquidity, or performance measures derived in accordance with GAAP. You should be aware that the company's presentation of these measures may not be comparable to similarly titled measures used by other companies. A reconciliation of each non-GAAP measure to the comparable GAAP measure is available in our earnings release and our full year report on Form 10-K for the quarter ended December 31st, 2022 on Noggin Investor Relations page at www.ir.noggin.com. Finally, I would like to remind everyone that a webcast replay of this call will be available via the link provided in today's earnings release, as well as on our website at www.noggin.com. Now, I'd like to turn the call over to Noggin CEO, Jonathan Huberman.
spk02: Thank you, Amy. Welcome, everyone, and thank you for joining us this afternoon on our earnings call. To begin today's discussion, I'd like to provide a quick overview of our business and review last year's highlights before turning the call over to our COO and CFO, Shari Arumadi, to discuss our financial results for the quarter and year. After that, I'll share some closing remarks before opening the call for questions. For those of you who may be new to our story, at Noggin, we believe that as retail e-commerce continues to grow and becomes more sophisticated, there is a large market opportunity to help merchants who need that e-commerce sophistication but lack the expertise, capital, and personnel to manage it at all. Noggin's commerce as a service platform satisfies this need in a few ways. First, Noggin provides a headless end-to-end technology platform that merchants can plug into instead of paying to integrate multiple technologies. Second, Noggin delivers advanced capabilities that are generally too complex and costly for many brands to buy, build, or manage on their own. These capabilities include a full customer data platform, social commerce abilities, and AI integrations. Third, Noggin includes leading edge R&D and innovation as a service so that clients are never required to expend resources on their e-commerce operations. Further, Noggin eliminates the need to re-platform because as we build these new features and tools, they're immediately available to our clients. And lastly, Noggin drives identifiable incremental performance for our customers based on insights from our proprietary data asset, insights unavailable to most outside of the Noggin platform. Noggin's business model includes taking a percentage of brand e-commerce sales conducted through our CAS platform, which ensures complete alignment between ourselves and our clients. Our growth strategy is rooted in three key pillars. develop and continuously advance our innovative and scalable commerce as a service platform, increase sales and marketing efforts to drive our pipeline, and expand our client base into new markets and products throughout e-commerce. We continue to make progress on all these fronts as we look to the rest of 2023. Altogether, as we grow and continue to scale our product and service offerings, our clients' e-commerce operations can scale in parallel. Our modern approach to commerce allows brands and sellers to grow more profitably and without upfront costs while still focusing their efforts on their core business instead of the resource-intensive nuances of e-commerce. I would now like to take a few minutes to reflect on our 2022 fiscal year. In many ways, this year was transformational for our business. After completing our business combination to enter the public markets in August, we added public company and industry expertise to our management team and board of directors to best position Naga to execute on our growth strategy. Also, a major driver of our decision to go public was to enhance our sales engine, and with that in mind, we made significant investments last year to bolster our sales force. These efforts have led to strong customer acquisition momentum, as well as a robust pipeline of additional brands that are interested in Noggin's capabilities. Expanding our client base remains an important part of our growth strategy, and we look forward to further driving our sales engine in 2023. We continue to invest behind our best-in-class Intelligent Commerce platform and made significant upgrades to our software in 2022. These efforts culminated in the launch of V1 of Intelligent Commerce, announced this month, which builds on the previous version and offers powerful new features including first-of-its-kind AI-powered customer segmentation, algorithmic merchandising, and automated campaign optimization. Our goals? remain to provide our clients with access to cutting edge enterprise e-commerce capabilities, and we expect to continue investing in our technology suite moving forward. Another area of focus for us in the back half of 2022 was our comprehensive cost reduction and performance improvement initiatives. While we work to position our CAS business for growth and margin expansion, profitable operations remain a crucial part of our strategy. These initiatives are already showing positive results including an adjusted EBITDA loss reduction in the fourth quarter. As we look to the rest of 2023, we expect to bounce these efforts with our investment into Noggin's technology and sales engine and believe that we're on a path to profitable growth. In total, we expect that our efforts in 2022 will allow us to effectively execute on our growth strategy moving forward. Especially in the current economic environment, brands are searching for ways to reduce costs while driving improved results. and our platform is uniquely positioned to help our customers do just that. With Noggin, high performance and cost effectiveness are never mutually exclusive choices. We are confident in our technology, our team, and our strategy, and look forward to capitalizing on strong momentum over the rest of 2023. With that, I will turn the call over to our COO and CFO, Shariar Ramadi, to discuss our fourth quarter and full year financial results in greater detail. Shariar?
spk10: Thank you, John. Turning now to our financial results for the fourth quarter and full year ended December 31st, 2022. As noted last quarter, our net revenue includes product-related revenue that stems from two previous deals that involved sales related to first-party inventory purchases. As that inventory is sold, generated revenue appears within net revenue in our GAAP results. Our non-GAAP revenue, however, is revenue generated by the core Commerce as a Service platform and associated services. We typically view non-GAAP revenue as a more accurate indicator of the business and expect our GAAP and non-GAAP revenues to converge over time. GAAP net revenue in the fourth quarter of 2022 decreased 39% to 27.9 million from 46.1 million in the fourth quarter of 2021. The decrease in net revenue was primarily due to a decrease in product revenue. GAAP net revenue for the 2022 full year decreased 7% to 94.5 million from 101.3 million in the comparable year-ago period. The decrease in net revenue was primarily due to a decrease in net product revenue during the year, partially offset by an increase in net revenue from related parties. For the fourth quarter of 2022, non-GAAP revenue, a non-GAAP measurement of operating performance, decreased 16% to 22.3 million from 26.5 million in the comparable year-ago period. The decrease in non-GAAP revenue was primarily due to a decrease in CAS and marketing revenue. Non-GAAP revenue over the full year of 2022 increased 3% to $72.4 million from $70.0 million in the comparable year-ago period. The increase in non-GAAP revenue was primarily due to an increase in CAS revenue. Operating loss in the fourth quarter increased to $12.6 million compared to an operating loss of $0.9 million in the comparable year-ago period. and operating losses for the 2022 full year increased to 40.3 million, compared with an operating loss of 6.3 million in the comparable year-ago period. The increase in operating loss was primarily due to supply chain issues experienced at the end of 2021, which impacted our performance in the first half of 2022, along with a one-time write-down of bad debt and royalty expense. The expected impact of the company's cost and performance improvement program for the full year 2023 is anticipated to be between $15 million and $20 million. The management expects to have the majority of initially identified initiatives complete by the end of the first quarter of 2023. And further, we expect these activities will have achieved their full run rate impact before the end of Q2 2023. Moving to our outlook for 2023. As of today, and based on our progress year to date, we expect to drive existing customer add-on sales as well as new customer agreements, both of which will have a positive impact to revenue. Additionally, based on the initial results of our cost reduction and performance improvement program, we expect to improve our operational efficiency, increase adjusted EBITDA, and generate significantly increased operating leverage in the future. As we execute against our strategy over the course of this year, We expect to drive improved results and look forward to providing incremental updates going forward. That completes my summary. I'd now like to turn the call back over to John.
spk02: Thanks, Shariar. Here at Noggin, we remain excited about the future and confident in our ability to execute against our growth strategy moving forward. Our traditional commerce as a service business is strong, and we believe that with our expanding pipeline of business across a myriad of industries interested in our solutions, we are positioned well to profitably grow over the coming quarters. Operator, with that, please open the call for Q&A.
spk07: Thank you. At this time, we'll open the line for questions. The company requests that each participant limit their comments to one question and one follow-up. To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile a Q&A roster. And again, as a reminder to ask a question, please press star 11 on your telephone.
spk00: One moment while we compile Q&A roster. And our first question is from Samad Samani with Jefferies.
spk07: Your line is open.
spk05: Hi there. Uh, thanks for taking my question. So maybe first just John, you know, we're, we're pretty far along in the first quarter. I'm curious what you've seen, maybe from a macro perspective, whether you want to speak to kind of aggregate customer behavior or what you're seeing, um, for Noggin specifically. And then I have a follow up question.
spk02: Sure. Um, so let me touch on that in two different ways. So first let me talk about new business. New business booking is accelerating dramatically. I expect between the signings that we had last week and the ones we expect to have, again, no guarantee we're going to get them, but we're expecting to see between last week and the end of April, we should sign up as many new customers as we did in all of 2022. So I think the bookings momentum, as we sort of alluded to in the prepared remarks, is really there and accelerating. On top of it, we're in advanced discussions with one of the top 10 business process consultants in the world about partnering with them on both implementation as well as sales to go forward. Again, no guarantee we're going to get it signed, but certainly we're in advanced discussions. Hopefully it will. So we're very optimistic about the pipeline side of the business. In terms of customer dynamics, as you know, the first quarter is the seasonally weakest quarter for us, as opposed to Q4, which is the seasonally strongest for customer demand in e-commerce. So it's kind of hard to baseline whether the year is going to end up based on Q1 because it is the seasonally weakest. Certainly, as you pointed out in your note, there's a lot of uncertainty in the markets. But I expect that the weakness that may show up, we don't know if it will, in consumer demand should be somewhat if not completely offset, it all depends when we get our bookings, by the new bookings momentum. As you know, the bookings momentum, if we sign someone up in December, we may see none of the revenue this year, but we should see all of it next year. So part of it is due to timing. for this year, but certainly if I look forward, you know, as we move forward, you know, into not just 2023 but 2024, I see, you know, very healthy growth thanks to the bookings, assuming it shows up. Again, no guarantees, but the initial indications are very positive. Does that answer your question?
spk05: Yeah. And then maybe just like I guess more specifically to what you've seen so far or looking forward, Are you seeing growth in your GMB year-over-year through the first quarter? What are the guardrails, or how should we think about what your maybe shorter-term expectations are for the business, given we're almost through 1Q?
spk02: Sorry, do you want to address that?
spk10: Sure. I think we've also made some decisions as we've taken a fresh look at the business. thought about some of our customers there were some customers where you know we we prioritize profitability over revenue growth if you will and so there are certain cases in which we have customers where achieving increased year-over-year comps would have come at a negative impact to profitability and where reductions in those growth rates or maintaining year-over-year for those customers or even slight declines year-over-year for those customers was a prudent decision from a profitability and long-term perspective. That's the tact we've taken. So, yeah, I think we didn't expect, we didn't see anything we didn't expect to see in the first quarter from an overall perspective, but we did make some intentional nuanced decisions around how we ran the brands and our interactions and engagements with our customers to be mindful of profitability versus simply sales at all costs.
spk02: And then one thing to keep in mind, Samad, we have a fairly concentrated set of customers, as you know. We have a few that are somewhat uniquely positioned, let's put it that way. And so it's hard to project based on one or two of those, how the whole industry goes. If one customer of ours has a mismatch between demand and what they have in stock, that is a somewhat unique issue, not one that can be projected across all of them.
spk09: Or even the entirety of the year.
spk02: Absolutely.
spk05: Understood. And then maybe just the last question for me. As you think about the um the restructuring or the the cost saving initiatives uh have we largely completed that um is there is there more to go um and is there consideration on maybe um taking additional steps or just kind of where are we at in terms of headcount and cost savings initiatives go ahead sure sure so we've um i think that we executed the majority of those items that were
spk10: labor-related in the Q4 period, in late Q4. And throughout Q1, the actions that we took were a continued benefit from efficiencies in areas such as our distribution operations, which not only lower our cost structure, but actually provide our customers with even more accelerated shipments, which, as you know, in this business is quite key. From then on forward, we took a variety of structural cost reductions in areas where we were able to achieve efficiencies, and that manifested itself in areas such as warehouse leases where we were able to concentrate our footprint and better utilize our existing facilities, even while we took on new customers and growth without needing those previously leased facilities. The manifestation of those cost reductions, which sum into the several hundred thousand dollars per month of incremental, are in process now. Some have occurred very recently. Others will continue to materialize over the course of the next 90 days. But all of them are expected to be at full run rate by the end of Q2. Now, will we find additional opportunities over the course of our daily operations? Absolutely. We're always looking for areas where we can drive further efficiency, especially in combination with efficiency that drives performance improvements in our core business. And that's the way we're thinking about running the business, just as a fundamental philosophy and methodology. So expect to see that we're very thoughtful about both the areas of savings and being smart about those and also very judicious and ROI driven in our investments.
spk01: Great. Thank you for taking my questions.
spk11: Thank you so much.
spk07: At this time, this concludes our question and answer session. And I'd like to turn the call back over to Mr. Huberman for his closing remarks.
spk02: All right. Well, thank you, everybody. I appreciate you joining and look forward to talking again in the not too distant future.
spk07: Thank you for joining us today for Noggin's fourth quarter and full year 2022 earnings conference call. You may now disconnect.
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