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spk07: Good afternoon, ladies and gentlemen. Welcome to the Beachbody Company first quarter earnings call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session. Instructions will be provided at the time for you to queue up for questions. If anyone has any difficulty hearing the conference, please press star zero for operator assistance at any time. I would like to remind everyone that this conference call is being recorded. And I will now turn the conference over to your host, Bruce Williams, Managing Director of ICR Investor Relations.
spk00: Welcome, everyone, and thank you for joining us for our first quarter 2023 earnings call. With me on the call today are Carl Deichler, Co-Founder, Chairman, and Chief Executive Officer of the Beachbody Company, and Mark Swedan, Chief Financial Officer. Following Carl and Mark's prepared remarks, we'll open the call up for questions. Before we get started, I would like to remind you of the company's safe harbor language. The statements contained in this conference call, which are not historical facts, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested in such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC which include today's press release. Today's call will include references to non-GAAP financial measures, such as adjusted EBITDA. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is available within the earnings release, which can be found on our website. Now, I would like to turn the call over to Carl.
spk06: Good afternoon, everyone. As we communicated in our last earnings call, this first quarter marked a major transition for the company. We completed the preparation and engineering of a significant upgrade to our subscription platform, and on a parallel path, simplified our business model. We evolved from a business model built on expensive and more complex program launches to a more economical and customer-friendly tempo of constant new monthly content organized into three-week blocks around genre and objectives. And based on almost nine months of successful pilots and tests, in March, we made the full transition to a single subscription we call BODY, that's spelled B-O-D-Y, aligned with the company rebranding from Beachbody to BODY. And we introduced a new content channel integrating mental health into our total solution formula. In doing this, we became the first comprehensive health esteem platform, synthesizing a holistic approach to living a healthy, flexible lifestyle, including the proven body block fitness format, sensible healthy nutrition programs, and positive mindset masterclasses to help people navigate the obstacles of day-to-day life and improve their mental health. I want to thank the team for their perseverance and skill creating this incredible new subscription product. And in the midst of this major launch, For the sixth quarter in a row, we've exceeded our met guidance in both revenue and adjusted EBITDA for the quarter. But there's so much more for us to accomplish. When we're scaling innovation, we operate a test and learn process. This is the process we've successfully executed multiple times over the last two decades. We did it when we launched P90X, effectively doubling our price per unit. And when we launched Shakeology into the network, moving from a $40 a month multivitamin subscription to a $130 subscription for the world's first superfood dessert shake. And in 2016, moving the business model from a single one-time purchase of DVDs to the Beachbody On Demand annual subscription. As the company scaled through these transitions, each time we reached the billion-dollar revenue milestone faster than the last, and we believe the expanded and repositioned body subscription is our biggest and most important innovation since we launched the company. I'm confident that this will be our next multi-billion-dollar opportunity to drive long-term, sustainable growth. We're in the early stages of promoting this new premium subscription, but I can report that we are already seeing promising customer demand based on the engagement and renewals of existing customers. Bodies surpassed 500,000 subscriptions as of April 30. That's roughly double since the end of Q4 2022, primarily driven by digital renewals and upgrades that are exceeding forecast. the early strength in renewals demonstrates customers are recognizing that our pricing represents tremendous value associated with our rich catalog of over 120 programs. I mean, everybody knows P90X, Insanity, and 21 Day Fix, but also our new body programming and the monthly release of new body blocks for general fitness consistency and to help our bike customers get the incredible results that our company's known for. Likewise, Nutrition subscription retention is ahead of our internal forecast, with March seeing the strongest retention rate in over 12 months. We also see a healthier nutrition attach rate with the new body subscription platform. This aligns to our vision of increasing our customer LTV by focusing on these loyal and highly engaged subscribers. In terms of engagement, our first quarter 2023 streams were 25% above the fourth quarter 2022. While seasonality was a factor with consumers refocusing on their health at the start of a new year, our sequential growth accelerated relative to 2022, which is a very healthy sign of consumer engagement and a testament to the loyalty of our subscriber base and the consistent popularity of our content. While the home fitness industry continues to normalize from the gains during COVID, we're seeing signs that our health esteem category is attracting significant interest as searches for the term body again that searches for our spelling b-o-d-i on google well google search is up 287 percent in the first quarter over the prior year and since the repositioning to body just in march web traffic to our sites increased by 20 percent over february We're strategically increasing the LTV of our customers and are already seeing the benefits of this subscription, as our digital LTV was up 13% in March versus February. Moving on to driving customer acquisition, now that the product has been completely introduced, we're focused on the execution of our go-to-market strategy. As a reminder, our three sales channels are our proprietary network of partners, previously called coaches, direct media acquisition through advertising and search optimization, and sales into our significant database. This is the time to go on offense, so let me share how we plan to achieve growth. Our partner network forms the majority of our sales generation. In addition to significant ongoing training, we've implemented new incentives to align our partners with our goal to drive digital body and nutrition subscription. This June, we're hosting our annual partner summit. which is typically attended by around 10,000 partners. This will be an immersive training of our network to align them with our strategy and sales tactics to serve the massive TAM of over 150 million people who are overweight or obese in the US alone, and to whom that health esteem platform is uniquely designed to help achieve long-term health and happiness. With the help of our team body partners, we intend to create the largest health and fitness community in the world. And I'm highly encouraged by the enthusiastic response of our partner network, although we do see that it's going to take some time to fully optimize and train the partners to leverage this significant transition. But based on their enthusiasm and engagement with the platform, I'm confident that we'll be successful. It's only a matter of time and execution. On the direct media acquisition front, we just started the test and learn process to acquire new subscribers into the body platform in our online and offline media advertising. We're also working with an extremely experienced social media and marketing agency to expand the reach of our message into TikTok and YouTube. Through our test and learn approach, our ROAS, or return on ad spend, continues to improve, allowing us to gradually expand customer acquisition while maintaining our LTV to CAC ratio, thanks to the improved economics of this new body subscription. On the customer database activation front, we see more significant opportunities to drive re-engagement as well as cross-sell, and we're expanding our efforts in CRM and database marketing to offer this new subscription to our massive database of customers, both past and present. In April, we launched technology to communicate with customers within our app and through text messages, expanding our customer engagement as well as building more targeted and sophisticated email marketing campaigns. Finally, we also began testing the expansion of our Shakeology supplement into the category of superfood desserts in Q1. Our marketing has just begun to leverage this category, and again, early signs are that this campaign will resonate, grow retention, and expand the total addressable market over time. In summary, the first quarter performed generally as expected, given the transition to the expanded business model. have experience with this level of content transformation and we understand what levers we need to pull to navigate the transition i believe that this chapter of growth will be the biggest opportunity in the company's history with two months of data points we're encouraged by the green shoots of demand and customer renewals and based on what we're hearing from the industry our pivot is not only the right strategy for these times but we have a significant head start however I do want to reiterate that it will take some time to fully train our partner network about the benefits of our comprehensive health esteem platform for them to drive significant new subscribers. And as such, we're taking a more conservative view of our Q2 outlook, but remain confident in achieving EBITDA profitability on a quarterly basis by the end of the year. Now, for more specifics on the quarter, I'll pass it over to Mark, our CFO, to detail our financial results for the quarter. Mark?
spk04: Thank you, Carl, and good afternoon, everybody. As Carl mentioned, we posted financial results ahead of our first quarter guidance for both revenue and adjusted EBITDA. I'd like to spend time discussing the impact of our body launch on our financials, review our quarterly results, and then provide our outlook for the upcoming quarter. So let me start with sharing our learnings from the body launch in early March. Such a large transformation has three major milestones. First, a product launch. Second, the existing customer reaction. And third, launching new sales and marketing efforts. The product was launched on time, under budget, and with all the scope and features that we planned on. This is a significant success and milestone in achieving our transformation. As it relates to the reaction of the existing customer base, we are pleased with the response and how it has been received. Let me provide some color on how we are delivering on the strategy of increasing LTV per customer. First, pricing. As a reminder, the body price was adjusted down from $298 to $179 annually last September. As of March 2023, you can only renew on body as we move to a single subscription platform. As a result of these changes, our digital LTV increased by 13%. Second, engagement and renewals. While early, the new and enhanced programming is driving more user engagement as measured by streams, which Karl mentioned. Engagement leads to more renewals and we are seeing renewals above our forecast, which improved our March revenues. While we factored in more churn for customer renewals given the price increase, we are encouraged by our renewal rate as customers are realizing the value of our new programming. As such, The body subscriber file has nearly doubled in size to 500,000 since the beginning of the year. Third, cross-selling. We are pleased with the higher nutrition and tax rates from our body subscribers, which are driven by digital and nutritional bundle pricing. As it relates to ramping up our sales and marketing efforts, Carl elaborated on the strategies that we are deploying. To summarize, we have successfully launched our new product. and have received a positive response from our existing customers. We have executed on two of the three critical milestones of our strategy and are now focused on the third one, which is the selling and marketing efforts that will drive new customer acquisitions. Turning to the financials of the quarter, given all the changes in the past year, I will focus my comments on quarter-over-quarter performance for revenue. Revenue was $144.9 million, which was ahead of our guidance, and 2.2% below the prior quarter. That is the smallest quarter-over-quarter contraction since Q4 2021. Digital revenue was 64.8 million versus 68.7 million in the prior quarter. Digital subscribers were 1.75 million, which decreased 10% quarter-over-quarter. The changes were largely attributable to the repositioning of our partner network to the new body solution, which impacted their productivity. Nutrition revenue was 74 million in line with the prior quarter. The number of subscriptions was 210,000, which decreased 5% from the prior quarter. We saw subscriptions bottom out in February, and as we launched the new body solution, we delivered more nutritional retention in March. Connected fitness revenue was $6 million, a 27% increase from the prior quarter. The increase was mainly driven by New Year's marketing campaigns. Gross margin was 63% compared to 47% in the prior year and 57% in the prior quarter. The improvement was driven by improved nutrition gross margins and a product mix composed of more digital and nutrition revenues. Let me walk through each product line. Digital gross margin was 77% compared to 80% in the prior year and in line with the prior quarter. The year-over-year reduction is mainly due to less scale given the decline in year-over-year revenues. As digital revenues grow with the new body solution, we are confident the digital gross margin will improve. Nutrition gross margin was 58% versus 54% in the prior year and 50% in the prior quarter. The nutrition gross margin benefited from an improved product mix, lower supply chain costs, and improved inventory management. Connected fitness gross margin was minus 26% versus minus 129% in the prior year and minus 122% in the prior quarter. The improvements were from pricing stability and stabilization in the non-cash accounting charges. Moving to our operating expenses. Excluding restructuring and impairment charges, our operating expenses were $113 million, which represents a 29% improvement from the prior year and is largely in line with the prior quarter. The improvement is a direct result of the cost transformation that we have been referencing for several quarters. Selling and marketing was 53% of revenue compared to 54% in the prior year and 50% in the prior quarter. As a reminder, the largest portion of selling and marketing costs is variable compensation for our partners, our gig workforce that earns commissions and bonuses when they sell our product. Our direct media acquisition continues to be disciplined with in-year payback and attractive ROAS targets. We are focused on driving higher LTV, which in turn generates more marketing dollars for us to capture more customer acquisitions. As mentioned earlier, we have seen our digital LTV increase, which is exactly what we want to achieve with our new strategy. Enterprise technology and development was 13% of revenue. improving from 17% in the prior year and 14% in the prior quarter. That is a 43% reduction in year-over-year dollar spent. That is driven by the simplification of our technology stack. GNA was 12% of revenue, up from 10% of revenue in the prior year and down from 13% in the prior quarter. The year-over-year increases from GNA deleveraging. While GNA is mainly fixed, it was down by 12% from last year in dollar spend. We continue to be aggressive in managing our expenses and ensuring our vendor spend is on Beachbody-friendly terms. Our recent RFPs have successfully reduced year-over-year spend despite rising inflation. Net loss was $29.2 million compared to a net loss of $73.5 million in the prior year. and a net loss of $44.9 million in the prior quarter. Adjusted EBITDA was a loss of $1 million compared to a loss of $19 million in the prior year and a profit of $3.5 million in the prior quarter. Adjusted EBITDA was ahead of our guidance and a 95% improvement from the prior year. We have designed our cost structure to break even at this level, and all the growth from our new body platform will drive profitable EBITDA. Moving on to the balance sheet. Our cash balance was $66 million compared to $80 million in the prior quarter. We are in a strong liquidity position and our cash use will improve in the coming quarters. Q1 had some non-recurring payments, including restructuring severance costs and 2022 bonuses. Inventory was $48 million, down from $54 million in the prior quarter. We continue to exercise discipline in demand and supply chain management resulting in a favorable 11% inventory balance reduction. In fact, our inventory balance has been coming down for seven consecutive quarters. The inventory level should start to level off from here on. Moving on to cash flows. Our cash flow from operations was minus $8 million, down from minus $33 million in the first quarter of the prior year. Factoring out severance costs and 2022 bonus payments, we would have had positive cash inflow from operations. Our capex for PP&E was $3.4 million, a substantial reduction from the $12.4 million in the first quarter of last year. Our content capex was $2.2 million, down from $6.4 million in the first quarter of last year. So combined, capex was $6 million, down from $19 million, a 70% improvement from the prior year. This should be our new CapEx run rate. In terms of capital needs, we have access to an additional credit facility of $25 million, but we continue to run the business without needing new capital. Now, turning to our outlook for Q2. I'm encouraged by the green shoots that we are seeing in response to our strategy. We are seeing improvements in renewals, engagement, and nutrition attach rates. Our guidance is based on where we stand in our transformation journey. We have successfully launched our new body platform. Our existing customers are reacting very well, and now we are ramping up our sales and marketing efforts in line with our objectives of EBITDA profitability. With that, we're guiding the upcoming quarter as follows. Revenues of $125 to $140 million. Adjusted EBITDA loss of minus $5 million to minus $10 million. This EBITDA reflects the annual summit event where the expense is recognized in the quarter of occurrence, but the cash outlay was incurred over several quarters leading up to the event. This is different from last year where summit occurred in Q3. Our cash use in Q2 will be below $10 million. Also, I've been asked by a few investors about our New York Stock Exchange delisting notice. I just want to reconfirm. The New York Stock Exchange has approved our plans to remediate this, so we will not be delisted. With that, operator, we can open it up for questions.
spk07: If you would like to ask a question, please press star followed by 1 on your telephone keypad. If for any reason at all you would like to remove that question, please press star followed by 2. Again, to ask a question, please press star 1. As a reminder, if you are using a speakerphone, Please remember to pick up your handset before asking your question. We will pause here briefly as questions are registered. The first question comes from the line of Joanna Zhao of Bank of America. You may proceed.
spk03: Hi. Thanks for taking my question. Great quarter and congrats on that. My question is focused on after the price change trying to understand the turn and the renewal rate a little bit better. Can you please help us understand just out of the remaining subscribers, I understand there were 500K for the BAUDI, but out of the remaining subscribers, what percentage of them are still on the $289 premium tier and what percentage is on the $119 tier? And then can you please help us understand, you know, what you're seeing on renewal rate and then in turn, After the annual price change for both cohorts or for both tiers, it's 289 and 119. And also, are you seeing any revenue uplift from the subscribers that offset the current subscribers loss because of the price change? And are you seeing a net positive for the business? If you can just comment on any of the signals you're seeing from early data, that would be helpful.
spk04: Hi, Joanna. This is Mark. Yeah, let me start off by commenting. Overall, we're very pleased with the churn rate because right now the people, if you think about the cohort, it's what I call the $99 cohort. That was the people who signed up to BOD at $99 a year ago. They're right now renewing onto BOD at the same rate that they were renewing a year ago from BOD to BOD. So we're very happy with that renewal rate. We had factored more churn, but it's not materializing. It's a great sign. I think people are engaging in the platform. We're seeing more streams, more activity, which all signals that they're appreciating it and they're seeing the value equation for them. So that's really good news there. When we said the file size doubled since October, January 1st, so it's around 500,000 now, which means we would have been half of that January 1st. There's very little of those people renewing now, because those people would have primarily signed up in the past six months, and frankly, most of them in the second half of that. So overall, pretty favorable change in terms of those people. It's not yet at the point on an LTV per subscriber basis. We're seeing the digital LTV being higher. And as our new sale effort and new customer acquisition ramps up, that's when it starts offsetting the decline in subscriber base. Does that answer your question, Joanna?
spk03: Great. Thank you. Yeah, yeah. Thank you so much. And just a follow up on the LTV to CAC. If you can just comment on like how your rebranding strategy and price change has really impact your latest LTV to CAC ratio. And how are you thinking about that ratio as you plan for the marketing spend for the remainder of this year or next year to acquire new customers? And what is kind of your new long-term LTV tax ratio expectation after the price change?
spk04: Yeah, Joanna, what I would say is a reminder that in our sales and marketing, which is running around that 50% of revenue now, the majority of that is variable sales compensation for our network of coaches and partners. And then as it relates to advertising spend, we continue to aim for a healthy LTV to CAC ratio. We haven't shared it in the past, but we aim for a healthy one. And we're currently aiming for in-year payback from a ROAS standpoint and everything afterwards when we think about the lifetime value of that customer becomes a great profit margin.
spk06: I will just add there, Mark, that We are, because of the higher price point of the body subscription at 179 and the strong take rate of annual, that obviously lends itself to a higher media allowable for our customer acquisition. So that can benefit marketing as we're in this test and learn phase as we roll out the new product.
spk03: Great. Thanks for the answer. Just two more if I can. So, my next question is on the recession risk. So, if you look at research that's done by IHRSA, U.S. fitness industry declined by about low double-digit percentage in membership during the last recession in 2008 and 2009. How do you think reopening and macro challenges will impact Beachbody this year versus prior years, obviously, given that we're heading into a recession? the assumption is so, and then also your 2Q guide implies a down 30 to 22% year-over-year revenue, and do you foresee the similar trend will go into the second half of this year, given that, assuming we're heading into recession, and how does Beachbody plan to navigate through this recession, and maybe just help put all of that in context for us?
spk06: It's a great question, and I think we're uniquely positioned, Joanne, for, actually the Great Recession, we did quite well. We are a very cost-effective alternative to the gyms when it comes to people wanting to continue their fitness and nutrition protocols when they might be looking at the household budget. So we saw an uptake in 2008, 2009, and we think we're well-positioned for that with our holistic approach to fitness, nutrition, and now positive mindset master classes. I'll also add that since our primary sales channel is our network of partners, you know, in this tight labor market, it's actually difficult to, for a household to get a second or in some cases a third job to add a supplemental income to the house. So they need to monetize something that they're doing anyway. And that's where the opportunity to earn an income by referring people into the ecosystem is an opportunity for them to earn extra money. And it's, again, this is the kind of thing that people are realizing is not an optional expense. It's certainly a part of their lifestyle. And we think that those two things, those two factors give us the opportunity to really excel through both the back half of this year and into the beginning of 2024.
spk04: Yeah, and I'll add to the second part of the question. You asked about the second half of the year. What I would say is as our business model change completes its implementation, the momentum buildup in our view would lead the second half to be more favorable than the first half, which is different than the classic seasonality factors of this industry.
spk03: Got it. Okay. That's helpful. And my last question is just to help us give us an opportunity, give you an opportunity to explain, what do you think is the most misunderstood by investors at this point about your company or stock?
spk06: I would say that, you know, people, people look at what's happening and the way the market works now, they're looking on a quarterly basis and, I think that can sometimes be a little bit myopic when we are looking at such a dramatic season of change. But this is a company that's been around for 24 years, and if you look around the industry of nutrition and fitness solutions, there aren't a lot of companies that have managed to have that kind of stamina and innovate over and over again. And this literally, this launch of the health esteem category and the body subscription, this will be our fifth big innovation as a company and we've run this playbook before and the thing that we've always operated on is very clear approach to preserving cash flow while we are keeping an eye toward growth and with our incredible assets of the deepest catalog in home fitness and this new business model, which is engaging consumers in such a compelling way. I think the company is really well set up to both to grow in this environment and particularly an environment that now has weight loss prescriptions. We are the holistic fitness, nutrition, and positive mindset resource for people who need to change their lifestyle at the same time that they contemplate prescription medication. So we're really in this ideal position that feels like everything that we've done for the last 24 years has led up to this moment. So we feel very good about where we are and we hope that the market recognizes the value of the company, our approach, and that we really are in a good position going forward.
spk04: Yeah, and Joanna, what I'll add to that, yeah, let me add to that. If you think about it, we've in addition to this track record, we've adjusted our cost structure for the level we're at. So you can see that our adjusted EBITDA was a profit in Q4, was a minus 1 million loss in this past quarter. So we've definitely kind of moved very aggressive on the cost side of the equation, improved the gross margin. We just came in at 63% gross margin, so very healthy gross margins. We only see it getting better from here. And like I said in the in the comments, our cash burn will go down from here on. So now as the, while others may be talking about implementing changes, like as Carl just said, we just implemented our major change in March and it should all kind of start flowing and, you know, the revenue upside benefits should all fall down to turn into profits to the bottom line.
spk03: Got it. Okay. Thank you so much. Appreciate all of your answers and that's all of my questions.
spk07: Thank you. The next question comes from Linda Bolton Weiser of Davidson. Please proceed.
spk02: Yes, hello. So I was curious if you could quantify the non-recurring cash payments that occurred in the first quarter that I assume impacted operating cash flow. I guess you said that was severance and bonuses. Could you quantify those?
spk04: Yeah, Linda, I would say the 22 cash bonus combined with the severance cost would be in that $10 to $15 million range. That's why I said if you factor those out, we would have been cash flow positive from operations in Q1.
spk02: So why do you consider cash bonuses to be non-recurring? I'm assuming that you will pay cash bonuses every year, correct?
spk04: Well, it depends. We self-fund our bonus, right? We've set ourselves an aggressive target, and we self-fund it. So as long as we beat what's against our plan, that's how we fund it.
spk01: Okay.
spk02: And then, you know, I guess I can kind of work through the model here, but at what point do digital subs bottom out sequentially? Like, will that occur this year or not until 2024?
spk04: Yeah, I would say, Linda, second half of this year is when that should bottom out, mainly because we're cycling through the basic bot file now. While it takes a year to cycle through it, as the body file size increases, The increases to that starts offsetting the smaller base of decline in the bot file.
spk01: Okay. That's all I have. Thank you very much.
spk07: Thank you. The next question comes from the line of Darren Tuttle of Singular Research. Please proceed.
spk05: Yeah, so great quarter, guys. I think you're almost right in line there with being EBITDA positive that you had for the quarter, so congrats on that. I just had a question on the deferred revenue. So looking at the deferred revenue of around $53 million for this quarter, the way that I'm understanding that in this transitional period, is that something – You know, with the billing and everybody on the new premium subscription model, is there going to be, you know, an expected change in the deferred revenue? Or do you think that, you know, that guidance is kind of pretty solid going forward?
spk04: Yeah, Darren, I guess as we're signing people up more at the $179 price point, it's a higher ARPU. I'd say most sign-ups are over a 12-month period. So that's where you will see that benefits cash up front from a billing standpoint, but we defer what comes later. So given we're increasing the LTV and the ARPU per customer, it will favorably increase the deferred revenue.
spk05: Okay, got it. Yeah, that's what I was expecting as well. And then in terms of the... If we just look at the inventory levels, right, and if we look at that towards the digital marketing spend, Carl had mentioned the new platforms, you know, potentially TikTok or things like that. Is TikTok maybe potentially getting banned in the US? Would that be a significant risk for your revenue guidance going forward? then on the back end of that for the digital marketing uh expenses uh you know how much of that is advertising directly with the platform and then how much of that is you know variable compensation to say partners on tick tock thank you yeah so um our exposure to tick tock is exactly zero right now um uh because we really don't do
spk06: Any business it's a it's a channel of expansion, to the extent that it exists, we do probably most of our digital advertising between Meta and. Google at this point so that's not an exposure at all i'll let mark speak to. The the ratio between media spend and variable expense to the network.
spk04: Yeah, Darren, look, we drive it so pretty much everything is variable from our side, right? Now, the network side does drive the majority of it. So in our notes to the financial, we do list how much we spend on advertising spend. So for this past quarter, it was $9 million. So if you back that out from the selling and marketing, the balance would be all variable sales compensation. And for the $9 million, we we don't do brand. We really focus it on, you know, clicks for allowable. So we're, we really drive it in a variable way. So it's driving new customer acquisitions.
spk01: Got it. Thank you. Thank you so much.
spk07: Thank you. There are currently no additional questions registered at this time. So I will pass the conference back over to the management team for any closing remarks.
spk06: OK, well thanks so much everybody. I'll just wrap today's call up. I just want to thank our shareholders for your enthusiasm in our mission and support for our direction. As much as we've had incredible success and are proud of our accomplishments over the last two decades, our aspirations are to help tens of millions of people achieve their goals and lead healthy, fulfilling lives. And those aspirations, that ambition has led us exactly to this moment in time and this, frankly, exciting new chapter for this company. So we're excited about what's ahead of us and proud to have you aboard. So I look forward to our next update after the second quarter and hope everybody has a good night. Take care, everybody.
spk07: And with that, we will conclude today's call. Thank you for participating.
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