QuinStreet, Inc.

Good day and welcome to Queen Street's third quarter and fiscal year 2023 financial results conference call. Today's conference is being recorded. Following prepared remarks, there will be a question and answer session, at which time callers will need to press star and 1 on your telephone keypad. If at any time during this call you require immediate assistance, please press star 0 for the operator. At this time, I would like to turn the conference over to Senior Director, of Investor Relations and Finance, Robert Amparo. Mr. Amparo, you may begin.

Thank you, operator. And thank you, everyone, for joining us as we report Quinn Street's third quarter fiscal year 2023 financial results. Joining me on the call today are Chief Executive Officer Doug Valenti and Chief Financial Officer Greg Wong. Before we begin, I would like to remind you that the following discussion will contain forward-looking statements. Forward-looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those projected by such statements and are not guarantees of future performance. Factors that may cause results to differ from our forward-looking statements are discussed in our recent SEC filings, including our most recent 8K filing made today and our most recent 10Q filing. Forward-looking statements are based on assumptions as of today, and the company undertakes no obligation to update these statements. Today, we will be discussing both GAAP and non-GAAP measures. A reconciliation of GAAP and non-GAAP financial measures is included in today's earnings press release, which is available on our investor relations website at investor.quinstreet.com. With that, I will turn the call over to Doug Valenti. Please go ahead, sir.

Thank you, Rob. Welcome, everyone. Fiscal Q3 results were strong. exceeding our outlook for revenue and adjusted EBITDA. Quarterly revenue was $173 million, growing 15% year over year and setting an all-time company record. Adjusted EBITDA jumped to $9 million in the quarter, once again demonstrating the strong operating leverage of our business model. Q3's good results were driven by continued strength in non-insurance verticals, where revenue grew 34% year-over-year and represented 58% of total company revenue. The good results were also driven by the strong early stages of the re-ramp of auto insurance. Auto insurance revenue surged 53% in Q3 over Q2. Q3 demonstrated our strong core business our continued success scaling and broadening our footprint, and the financial resilience and leverage of our business model, all on the foundation of sound business and financial fundamentals, cost discipline, and a great balance sheet with no bank debt. As we look ahead, you can continue to expect more of the same. As demonstrated once again, we are definitely built to last. And our long-term business opportunities and capabilities have never been better. While auto insurance client spending came back strongly last quarter, as they and we had forecast, clients once again reduced marketing spend in late March and early April due to recurring mixed results with their combined ratios. or profitability. The reductions were significant and unexpected for them, and therefore, of course, for us. Clearly, the road back to normal for insurance carriers from the challenges of the pandemic, inflation, and severe weather events is complicated and difficult to navigate, even for the best companies. The unexpected break in the re-ramp of auto insurance client spending will affect our outlook for the current quarter or fiscal Q4. But the near-term insurance carrier spending reductions do not diminish our longer-term opportunity, expectations, or enthusiasm for that big and important market. The auto insurance re-ramp is pausing, not stopping. the long arc of auto insurance spending is still up and to the right. Carriers will continue to adjust and adapt, and marketing budgets will continue to shift from offline to online. Most consumers will continue to shop online for everything, including ever more so for insurance. And digital performance marketing like that pioneered and enabled by Quinn Street will still be the most efficient marketing spend at scale for advanced marketers. In the meantime, Quinn Street will keep doing what we have been doing. We will continue to make great progress on initiatives to broaden and diversify our revenue footprint and to grow our market opportunity in insurance and in non-insurance client verticals. We will focus investments on new technology, product and business expansion areas that offer the best returns and the biggest opportunities for future growth. And we will maintain a strong fundamental financial foundation, including of course, cost discipline and a strong balance sheet. Of particular note, we will continue to stay spring loaded for strong leverage and rapid margin expansion as revenue grows or returns, as demonstrated last quarter. Turning now to our near-term outlook. We expect auto insurance revenue to decline in FYQ4 versus FYQ3 due to the unexpected near-term carrier spending reductions. For full fiscal year 2023, which ends in June, We expect revenue of $575 to $580 million. We expect positive adjusted EBITDA in FYQ4, despite the auto insurance challenges, and that adjusted EBITDA for full fiscal year 2023 will be between $16 and $17 million. We have also begun the detailed planning process for our fiscal year 2024. which begins in July. We expect revenue and adjusted EBITDA to grow at double digits in fiscal year 2024, and that we will be strongly cash flow positive. We will update our outlook and be more precise as the re-ramp of auto insurance continues to unfold. Our longer-term outlook has never been better. We expect double-digit annual revenue growth rates on average in coming years due to continued strong performance in non-insurance businesses alone. We expect auto insurance revenue to be up and to the right, eventually returning to and exceeding FY 2021 peak levels. We expect adjusted EBITDA to grow faster than revenue, eventually exceeding a 10% margin. Our adjusted EBITDA margin in March jumped to 7% just from the early stages of the return of auto insurance revenues, demonstrating the leverage we expect in future quarters and years. With that, I'll turn the call over to Greg.

Thank you, Doug. Hello, and thanks to everyone for joining us today. The continued strength and resilience of our business model and inclined vertical footprint were on display again in the March quarter, where we delivered strong results, including an all-time record revenue quarter, a return to double-digit year-over-year revenue growth, and even stronger adjusted EBITDA growth. Total revenue was $172.7 million and grew 15% year-over-year, despite the early stages of the recovery in auto insurance as well as a shifting macroeconomic environment. Our non-insurance client verticals represented 58% of total Q3 revenue and grew 34% year-over-year. Looking at revenue by client vertical, our financial services client vertical represented 70% of Q3 revenue and grew 11% year-over-year to $120.2 million. This was a result of continued strength in our credit driven and banking client verticals, as well as an improving environment in insurance for the quarter. Our credit driven client verticals of personal loans and credit cards, as well as our banking business, delivered excellent results in Q3. Combined, these non-insurance financial services verticals grew 48% year over year. Within insurance, We did see a significant ramp in revenue in the March quarter, though carriers have since unexpectedly reduced spending to assess and adjust to current market conditions and results. We still expect auto insurance to be up and to the right over time and believe that it is a great long-term growth business for Quinn Street. The exact pace of carrier re-ramps is unclear. Revenue in our home services client vertical grew 24% year-over-year to $50.3 million, or 29% of total revenue. As we've discussed in the past, home services may be our largest addressable market and has run rating to an over $200 million business, growing at strong double digits. Our strategy to drive long-term growth here is simple. One, grow our business from our existing dozen or so service offerings Examples being window replacement, solar system sales and installation, and bathroom remodeling, none of which we believe are anywhere close to their full potential. And two, expanding into new service offerings where we see the opportunity to at least triple the number of these sub-verticals we currently serve. This multi-pronged growth strategy is expected to drive double-digit organic growth for the foreseeable future. Other revenue was the remaining $2.2 million of Q3 revenue. Adjusted EBITDA for fiscal Q3 grew 30% year-over-year and sequentially from $1 million to $9 million, demonstrating the significant operating leverage of our business. Turning to the balance sheet, we closed the quarter with $63 million of cash and equivalents and no bank debt. Cash in the quarter was impacted by the timing of receivables, where we received over $15 million of payments shortly after quarter end. Those payments would have typically been received before quarter end, so a more normalized view of our ending cash would be approximately $78 million. Normalized free cash flow in the quarter was $5.2 million. Normalized free cash flow is our primary cash flow metric as it removes the effects of current quarter working capital account fluctuations to drive to the underlying cash flow characteristics of our business model. In closing, we are excited about our business and financial model as we move forward. Our diversified portfolio of client verticals has enabled us to drive double-digit revenue growth and expansion of adjusted EBITDA, despite being only in the early stages of the recovery in insurance. We expect to drive you into stronger total company revenue growth and further expansion of both adjusted EBITDA and cash flow as insurance revenue renews its path up into the right. With that, I'll turn the call over to the operator for Q&A.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the one on your telephone keypad. You will hear a three-tone prompt acknowledging your request. Questions will be taken in the order received. Should you wish to cancel your request, please press the star followed by the two. If you are using a speakerphone, please leave the handset before pressing any keys. One moment, please, for your first question. Your first question comes from the line of Jason Krayer from Craig Hallam. Your line is now open.

Hey, gentlemen. Thank you for taking my questions. Wanted to start out just seeing if you could give some color on your expectations on just the cadence of auto insurance as we move forward. Obviously, you've given us a guide for Q4, but as we get into 24, just curious how much visibility you have and really what your thoughts are on auto insurance relative to your statement on double-digit growth for next year.

Hey, Jason. Yeah, happy to. We don't have a lot of visibility in auto insurance right now. Carriers have indicated that they expect to continue to make progress, that they don't expect to be meaningfully changing their spending in the channel before July at the earliest. And we assume that it probably could be until January at least before they significantly re-increase spending just like they typically do in January. with the resetting of loss ratios. And over that same period of time in between a course, what also happens is the commitments they've made to spend in other areas that they can't pull out of as quickly as they can pull out digital kind of run off. So that also creates room for spending. So a long way of saying not a lot of visibility in the near-term areas, likely progress and better opportunity for them to increase spending into the fall, late fall, and, of course, January forward. But as far as how that relates to the outlook we gave you, we are assuming in the outlook we gave you, we can achieve double-digit revenue and EBITDA growth next year and, of course, strong cash flows with auto insurance not getting any better from here. We've kind of taken it out of the forecast, if you will. We just don't have enough visibility. I think that's overly conservative. But just so you know, you can put a floor under it. We can pull it down to where we are now and deliver what we described.

Helpful. Thank you. Wanted to also maybe get thoughts from you on personal loans and credit cards. Specifically, we've been hearing that kind of credit has been tightening and or the credit tightening trend has moved out of just subprime and moved into prime, which I think is an area you participate in. And it doesn't seem like you're seeing any pressure kind of baked in in the commentary you gave, but maybe you can just talk a little bit more detail on those two categories.

Yeah, as you heard, those businesses have been very strong for us for a while, and we're particularly strong this fall. this fiscal year and this past quarter. We are seeing some slight tightening, particularly for more risky credit cards and for more risky loans. And that is baked into our forecast as well. We do not expect that personal loans and credit cards will grow nearly as fast in the coming fiscal year as they did last fiscal year, largely because of that. But we do still expect to have good, strong growth there based on the indications we're getting from clients about where they want to focus and the budgets that they're likely to have. So right now, again, we think there has been a little bit of tightening, not to the point of significantly tightening, affecting, of course, our results yet. And we can perform at really strong levels with that tightening at this point, but not to the levels we've been performing lately, but still really strong levels to deliver the outlook that we gave you.

Thanks, Doug. Appreciate all the color.

Thank you, Jason.

Thank you. And your next question comes from the line of John Campbell from Stephens, Inc. Your line is now open.

Hey, guys. It's Jonathan Bass on for John. Broadly, from a cost and employee headcount standpoint, I know you've been carrying higher than usual costs on the insurance side as you're awaiting a more meaningful turn in the cycle. If the reduced spend environment holds on for several more quarters, would you look to address the insurance support costs?

We're pretty tight in our insurance headcount. Actually, Jonathan, I might say what we're carrying is probably more than the current revenue level would require, but no more than what we expect a reasonable expectation of re-ramp to require. We think it'd be foolish on our part to take out the capabilities to take advantage of the resurgence of spend that we expect. And as you just saw last quarter, Just last quarter, when we were barely into the re-rent, even though it was up 53% quarter to quarter, we were, I think, half or less of what we expect the full re-rent to represent. And the company jumped to 7% EBITDA in the month of March just with that. So I think we're well positioned. I think we'll stay tight. I don't think you're going to see us adding a lot. but I don't think you're going to see us reducing a lot either. I think if we do that, then what we do is when, when spending and when an ad spending comes back, we're just not positioned to take advantage of it. And worst case, we lose share of that spin. So I think we're, I think we got about the right balance right now. And mainly because we're always pretty dark cost discipline. We didn't get way out of our skis. We've, but we, we want to maintain enough capacity, as I said, to, to do well as it comes back and to not have to take a few steps backward or lose share when it does. Okay.

Thanks. And we haven't talked much about QRP in recent quarters, so I'm hoping you can provide the latest state of things with QRP and when you think that could rise to a more meaningful driver.

Yeah, that's a good question. QRP, we've continued to make great progress with QRP. with the product, with carrier integrations, with the application of the product to the ecosystem, which really represents the next stage, quite frankly, of the insurance channel and the insurance digital channel. We're more excited than ever about it. It's a seven-figure business for us right now. We would like to have been a lot further along than that, but just like the broader markets, QRP's progress is blunted by the fact that their overall market is challenged. As carriers have reduced their spend, reduced their coverage, and therefore agencies have had to reduce their spend and their agent accounts and their activities. You know, the pipelines have really, really bogged down. We have a lot of activity, a lot of conversations. We feel like that's a coiled spring for sure. As the market comes back, it trickles down into particularly the agency side where they start adding activity and agents and the ability to spend. Yes, super excited about where we are. The product is further and better than it's ever been. The support from the industry and the carriers is better than it's ever been. The uniqueness and defensibility of that product over the long haul and its application to new areas of the channel is better than it's ever been, but just hard to get a lot of activity in the current insurance market with the carriers, you know, pulling out of coverage and states and, and, and, and spin. So, but yeah, I love it. Love the product, love where it's going and excited about it.

Okay. Thank you guys.

Thank you, Jonathan.

Thank you. And your next question comes from the line of Eric Martinez from Lake Street. Your line is now open.

Yeah, just curious to know the progressive, what percentage of the business was progressive this quarter?

Hey, Eric, this is Greg. Progressive was about 25% of revenue for the quarter.

Okay. And then, you know, they're typically kind of a leader as far as both ramping up and pulling back. what was the, I guess the, the cadence sounds like March was there. And then April, they pulled the rug. Was it, were they kind of the primary driver of that pullback in April or was it across your customer base?

It's been across the customer base, but progressive was way out further than anybody else to begin with. So the other pullbacks are much, much less material. Um, but, but, um, to us and to everybody, as you'll see in the numbers going forward. So, I mean, they are, you know, they do a phenomenal job of getting their product adjusted, get their rates adjusted, and doing what they do. And so they were just further out than everybody else. And so they matter. When they pull back, it matters more.

You know, I guess the historic pause length, I was kind of surprised to hear You're talking about January of 2024 before we'd be kind of normalized or returned to some sense of normalcy. What are the gating items between here and there? Is it just those auto insurers just needing to get comfortable with the loss ratios?

Yeah, and again, I don't have any particular information about the time it's going to take to come back. I just think we have to be really cautious about guessing when they haven't told us either. You know, the only information we've gotten from most of the carriers is that it's not imminent. So we, you know, so our best guess, and some indications have been that they think some budgets will start loosening up in July. I think the cadence of what's going to happen, as best we can read it again, you know, The carriers themselves are sorting it out and figuring out what they need and want to do. But they have to continue to make progress on the economic side, both on the rates and on the costs. Some of that's in their control. Some of it's not. The costs that aren't in their control, they'll probably try to fix with taking more rate. The costs that are in their control, and some of them have some costs that they're addressing and working on. They also have costs on the marketing side that they can't reduce like they can marketing spend or at least digital marketing spend. And so they'll work on some of those costs and or some of those costs will run off. When I say run off, I mean particularly commitments they may have made to marketing spend that can't be reduced immediately like digital can. And so that will run off. So those will be gating items over the next number of months And then, of course, the big gating item, besides the fact just the economics continue to get better and better as they tune their product, tune their rates, tune their costs. The big gating item will be the resetting of combined ratios in January again, which is always a big gating item for the industry. And as they make more progress, you know, just like this year was better than last year, January through March, Next year we'll probably go longer and bigger yet, and then we'll keep going up and to the right from there. They'll just keep adapting. So I think that's, as best we know from what they've told us from industry data, from industry experts, and from all the other things we've seen and heard, that's probably how it goes. I would say that our team believes, based on conversations with the carriers, that January could be a big surge again. We just, you know, we don't want to count on that. and the outlook we gave you assumed that that does not happen. But that doesn't mean it won't happen.

Yeah, no, just predictably unpredictable.

Yes.

The other parts of the business, the non-insurance business, terrific growth there. You know, that's 58% of REVs and up 34%. Any cracks in the home services side? I know you talked about, hey, we're growing window and solar and bathroom and we're expanding into new, but I would think in a rising interest rate environment, there might be some pressure on ability for homeowners to take on new projects. Doesn't sound like you're seeing that at all.

No, we're seeing nothing but strength in home services. And we're asking the question constantly. We've been asking the question for a year and a half. What we appear to be seeing, a main driver appears to be just the opposite with interest rates. As interest rates have gone up, homeowners are less likely to sell their home because they're in a good rate on their mortgage and they don't want to take on a worse rate or higher rate for a new home. And so we're seeing a lot more folks staying in the homes they're in and choosing to invest in that home rather than buying another home. And so we're actually seeing a very high activity level and high demand in home services pretty much across the board because the other factor is that even though rates have gone up, most of these are homeowners and they have built up a lot of equity in their home over the last number of years. And these folks' balance sheets and frankly their income statements, as we all know, are actually in really good shape. The folks that are being hurt most in the current environment and are likely to be hurt most if and as there's a greater slowdown, recession or not, where the lower end of the income spectrum intend not to be the kind of homeowners that spend on these projects anyway.

Okay. Well, that's consistent with the answer you gave last quarter. So just like you're saying on top of it, I want to stay on top of it. Thanks for taking my question.

You bet. You bet. Thank you, Eric.

Thank you once again, Dr. Starr, and I want to ask a question. And your next question comes from the line of Jim Goss from Barrington Research. Please go ahead. Hi.

I don't want to beat this to death, but it sounds, Doug, like that there's no magic trigger in terms of combined ratio that will be an on or off switch in terms of greater marketing expenditure. Historically, though, has there been some range around the magic 100% that might make the carriers more inclined to try to advertise for new customers, or are they reluctant to go into a negative position, even though that might be the right time to try to sell their product? No, it's a great question.

It really differs by carrier and where they're in their own long-term trajectory and strategy, Jim. Some have very firm targets for combined ratios, and they will hit that number for the year come hell or high water. And others... have a different strategy and there are times when depending on where they are on the market and where they want to be in terms of market share and other considerations they are willing to go negative for longer they have the capacity to go negative for longer in order to achieve other objectives or other goals so it really does depend on the carrier so I think what we're going to see is continued kind of gradual progression as different carriers solve different solve for different considerations or objectives. But, again, it's, you know, historically and predictably, they'll just keep iterating their way up and to the right. This has been a very complicated environment for them to have to deal with and for all of us to have to deal with. I mean, this environment is tough on a whole bunch of different industries. And these are very smart companies doing really good things and trying their best. And as we saw, it's just they're finding it less predictable, like we all are. and harder to navigate like we all do. But I'd say that no magic bullet. I think continued progress for sure because they're all working hard on it. They're a number of public companies and a lot of big mutuals, and they have constituencies to serve. And they want to grow, and they want to get paid too, and they want to serve their shareholders. So they're working hard on it, and I think they'll keep making progress. But again, it depends on the company. Some are very, very specific and very driven by a particular number of Some are not. But in the mix overall, they're all trying to fix it as best they can, and they'll start getting in the market when they can. I can tell you that the activity levels of some of the carriers, even those that are not spending much at all, again, in the channel yet, we have very high activity levels with a number of them. And they have a lot of budget that they will deploy. So they're doing the work to be ready to spend it. They're just kind of waiting to get to the point where either Other costs are where they need them or loss ratios are where they need them or rates are where they need them to really start ramping quickly. But from our seat working with them, things look really good. And like I said, we're spring loaded. It's going to come. It's just a question of exactly when. And in all likelihood, we begin to see some progress in the fall, but probably not the inflection-type progress until January. And then, you know, we have a good shot of seeing a lot of it then. But we just, given what, you know, the ups and downs we've seen in the past couple years as they try to navigate this environment, we're reluctant to guide to that. So we'd rather just say, you know, let's assume it stays challenged for the fiscal year, and then what can we do with all the other businesses in that environment? And that's what we gave you.

And when you say next year, just for clarity, you're talking about calendar 2024? Or is it the fiscal year?

Yeah. And let me clarify that, and I apologize. I know that's always confusing. I get confused myself. Next year, in terms of when we're likely to see, when I say next year in terms of when we're likely to see more inflection and progress, I meant as in calendar year, the January with the change of the loss ratios. When I talk about the guide for the year, the fiscal year, for now, this coming July through June, that's where we really haven't assumed progress in insurance in order to give you the outlook we gave you. So the guide I gave you was for the fiscal year. And we've assumed no real progress during the fiscal and auto insurance to get to the double-digit number that I gave you for revenue and EBITDA growth. Or not number, but indication I gave you for revenue and EBITDA growth. But we do expect, if everything goes according to oil and the way it's done historically, there probably will be an inflection of spend in January with the new calendar year. because loss ratios do reset, and that gives them another eight months to keep making progress. And we know another company that reported recently that is in this market indicated that they thought it would be eight to nine months, and I think they're looking at the same calendar. They're saying, hey, January is probably when we're going to start seeing a re-inflection. It's not a bad guess given history at all.

All right, and one last one for me. I'm just curious, what will consumers interested in new insurance options see now relative to what they might have seen in other times? More costly options and or fewer options? Both, yeah.

Fewer and more costly is exactly what they're going to be seeing. And in fact, we've seen more shopping because of that, but we've seen When they shop, they don't find a lot of options, and they find a lot of expensive options. So we think the shopping behavior will continue as more and more consumers get renewed at higher rates. But for now, their options are much more limited, and those that are available are considerably higher in terms of the rates than they would have seen, say, last year at this time or certainly the year before.

All right. Thank you.

Thank you.

Thank you. And your next question comes from the line of Chris Takai from Singular Research. Please go ahead.

Hi, Doug and Greg. Hey, Chris. Just had a question on the car insurance. What drove the fact that it was so unexpected? It seemed like last quarter you guys weren't expecting this. You were expecting just more growth. Why was it such a sudden unexpected decline?

I wish we knew. I mean, I can tell you what the carriers have said, because it was unexpected to them as well, right? And you've heard that from everybody in that industry and everybody in our industry. But again, that's their business. But what they have said is that their loss ratios were higher than they expected when they went to re-ramp spend both because of the repair and claims costs being higher than anticipated and because the rates, while in many cases they had taken or increased their rates, those rates were not high enough to offset those costs being higher than they expected. You and I could both, in terms of the details of why that is, it's everything to do with the inflation underlying inflation that everybody else is dealing with is probably also the nature of the new consumers that they're signing initially. In some cases, there's been an indication it was the nature of the operations to estimate and serve those consumers. And there's even some one-off things. There's a law in Florida that got changed that pulled a lot of the litigation forward. because it would be, I guess, more difficult or at least less lucrative, I guess, to sue the insurance companies once the law goes into place and the deadline. I understand. I've been told. I'm not that wonkish in the insurance industry, but I'm told that that expiration for submitting those lawsuits was like March 31st, so apparently that created a rat that's got to work its way through the snake. Lots and lots of stuff, but I'd summarize it and better ask the actual insurance carriers themselves or folks that follow that industry in a more rigorous research way. But the gist of it is, you know, they've taken rates. It looked like things were good. They started to ramp. They ramped hard. The results started coming in. The results were a lot worse than they expected, and here we go again. But they had every indication, and they'd given us every indication, and they'd given the markets every indication. that they were going to be, you know, peddled to the metal. And they were for three months or so. And then, you know, results started coming in. This isn't just one client. We're seeing this. We've seen this type of behavior across the industry. It's just that, you know, one client tends to, when a particular client happens to with us, it has more of an impact on us. But this is not isolated to one client. This is a whole bunch of, carriers working through a very complicated environment. And they will work through it. It's a mandated product. They're for-profit and or constituency-serving institutions. They work through other challenging stuff. This one just has been a little bit more complicated and difficult, obviously.

Okay, thanks for that. And then what are some of the other service offerings that Greg mentioned? Can you shed some light there?

Service offerings. Oh, in terms of trades in home services? I mean, we probably don't want to talk about what new trades we're targeting because that's a competitive question. But, you know, when we talk about service offerings in home services or trades in home services, Greg gave you some examples of what we mean by a service offering or a trade. And that would be like window replacement, solar installations, kitchen or bathroom remodels. But there are dozens and dozens and dozens of those specific sub-verticals or trades or service areas in the home services market writ large. We're in a little over a dozen of them right now in a meaningful way. Most of them are pretty early in their development. And we think we can be in and we can serve clients in about three times that over time. And maybe even more, but certainly we think about three times that. So Mainly, he was making sure that everybody understood that we're really early in a very big market in home services, and we have a couple of big vectors for growth. One, we'll grow the service areas that we're in today by adding more clients, more median, doing more, getting more budget from those clients as we optimize performance for them. That's one leg. The other vector is we'll get into more service areas. We'll add more. areas of, you know, or sub-verticals, if you will. So a lot of expansion opportunity and potential and long-term growth baked in to our strategy and to our approach in home services.

Okay. Thanks for that.

Thank you, Chris.

Thank you. And there are no further questions at this time. Thank you everyone for taking the time to join Queen Street's earnings call. Replay information is available on the earnings press release issued this afternoon. You may