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spk08: Welcome to the PROS Holdings third quarter 2020 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to Shannon Tatz, Vice President of Investor Relations. Please go ahead.
spk07: Thank you, Operator. Good afternoon, everyone, and thank you for joining us. Our earnings press release, SEC filings, and a replay of today's call can be found on the Investor Relations section of our website at pros.com. With me on today's call is Andres Reiner, President and Chief Executive Officer, and Stephan Schultz, Chief Financial Officer. Consistent with how our global team is operating today, the three of us are hosting this call from our homes. Please note that some of the commentary today will include forward-looking statements, including, without limitation, those about our strategy, future business prospects and market opportunities, and our financial projections. Actual results could differ materially from such statements in our forecasts. In particular, there is significant uncertainty around the duration and impact of the COVID-19 pandemic. This means that results could change at any time, and the contemplated impact of COVID-19 on the company's business results and outlook is a best estimate based on the information available as of today. For more information, please refer to the risk factors described in our SCC filings. PROS assumes no obligation to update any forward-looking statements to reflect future events or circumstances. As a reminder, during the call, we will discuss non-GAAP metrics, reconciliations between each non-GAAP measure and the most directly comparable GAAP measure to the extent to which available without unreasonable effort are available in our earnings press release. With that, I'll turn the call over to you, Andres.
spk04: Thank you, Shannon. Good afternoon, everyone, and thank you for joining us on today's call. On behalf of PROS, we hope that you and your families continue to stay healthy and safe. The pandemic has impacted our customers and our business, but I'm incredibly proud of how our team is executing and supporting our customers. I'm pleased to report that even in this particularly challenging macroeconomic backdrop, we beat our revenue and profitability guidance last quarter. These results reflect our commitment to our mission of helping people and companies outperform in the incredible value our digital selling solutions provide. Our vision is to be the AI platform that powers digital selling. And companies across industries now recognize that selling digitally is essential to win in today's new reality. In the first few months of 2020, e-commerce penetration in the US rose from 16% to 33%, according to industry analysts. There has been more growth in the past few months than the whole last decade. This rapid shift in buying behavior creates an incredible opportunity for companies that embrace self-service. And we're uniquely positioned to power omni-channel selling with our AI pricing and selling solutions. Our leading AI platform that powers digital commerce continues to set the pace of innovation, and we're laser focused on helping our customers win in this digital era. At our outperformed customer conference earlier this month, we unveiled many new digital commerce innovations. Like most companies, we held our conference virtually this year. While I miss connecting with everyone in person, it was amazing to have more than 5,000 registrants from over 1,000 companies to hear about our latest innovation in digital selling thought leadership. This kind of reach simply wasn't possible before. And the strong turnout we had for our performance is testament to the importance of pros empowering digital commerce today. During the event, We release our next-generation dynamic pricing capabilities for B2B commerce to accelerate companies' shift to digital commerce. Our innovative algorithms enable companies to quickly deliver dynamic market-driven prices across online, low-touch, and no-touch channels. This next-generation solution gives companies the ability to harmonize between negotiated and non-negotiated channels to win in their markets and deliver a great customer experience. We were also excited to announce the expansion of our relationship with Adobe. Adobe has been an incredible customer and we look forward to expanding our partnership with them after releasing our Magento Accelerator and joining the Magento marketplace. Now our joint customers can power their online channels with our market leading digital commerce platform. For travel customers, we showcase dynamic class-free pricing, which is at first in the industry. This innovation enables airlines to better identify passengers' willingness to pay by delivering dynamic pricing along a continuum and removing the limitations historically imposed by fare classes. Additionally, we release our latest innovation for group sales to help airlines address the challenges of today. Our latest innovations offer extended reservation windows with refund and change capabilities so airline customers can provide group travelers with increased flexibility and a great customer experience. Innovations like these are helping companies better serve their customers and adapt in an ever-changing market. Now I'd like to share a few customer examples from the third quarter. Last quarter, we welcomed diversity as a new customer. Diversity is a global leader in hygiene, infection prevention, and cleaning solution that is playing a critical role in helping businesses and facilities reopen safely. Diversity selected our guidance and opportunity detection solution to personalize their offers and prices based on the customer's unique needs. We're incredibly proud to partner with diversity and help them adapt their business to capture growth opportunities. Last quarter, we also expanded with existing customers. For example, a leading international health diagnostics provider chose to migrate to our smart CPQ and guidance solutions. With our technology, the company plans to deliver a better customer experience to physicians, hospitals, and clinics to ensure their patients across the world receive diagnostics such as COVID tests faster. Final example of how our customers leaning into self-serve is Qatar Airways. Qatar Airways has been a customer for more than two decades and last quarter chose to migrate to our next generation group sales optimizer in OneSearch Solutions. With these solutions, Qatar Airways will be poised to deliver a frictionless, self-serve booking experience for group travelers across the world in advance of the FIFA World Cup in 2022. These are just a few examples of how we're helping our customers reimagine how they sell to win in the digital era. Now I'll shift to comment on the pace of our business. While we continue to feel the effect of COVID, in B2B our pipeline continues to grow and the market demand is improving over the first half of the year. We're focused on helping customers start smaller and achieve faster time to value. In travel, our main focus continues to be supporting airlines on their way to recovery. Our logo retention with airline customers remains best in class, which is a testament to the significant value that our solutions provide. The ongoing impact of COVID is putting some pressure on the dollar-based retention associated with our travel customer renewals, which Stefan will cover in more detail. Overall, we're pleased with how we're continuing to deliver on our mission. We're excited about the new innovations we're bringing to market that will help us lead in the area of digital selling and capture our attractive market opportunity. I want to thank our amazing global team for your unwavering commitment to our customers. And thank our shareholders, partners, and customers for your continued support of PROS. With that, I'll turn the call over to Stefan to cover our financial performance and business outlook.
spk00: Thank you, Andres. IQ would like to extend my best wishes to everyone on today's call and to your families. Also, thanks to all of you who attended our virtual outperform conference. If you weren't able to join, all of the sessions are available online and several sessions feature more information on the new innovations Andres mentioned in his prepared remarks. I'd like to congratulate our marketing team for successfully executing our first ever fully virtual customer conference. and driving more than a 600% increase in event registrants year over year. Now turning to the third quarter, our subscription revenue was $42 million, increasing 9% year over year. Total revenue was $61.5 million and representing a decline of $2.6 million year over year. Our recurring revenue as a percent of total revenue was 86%, which was our highest quarterly mark to date. the recurring portion of our deferred revenue was $105 million, up slightly sequentially, and our trailing 12-month calculated billings increased 3% year over year. Moving on to our profitability metrics, non-GAAP subscription gross margins were 71%, down two percentage points sequentially, largely due to slightly lower sequential subscription revenues. Non-GAAP total gross margins were 62%, up one percentage point year over year, driven by improvements to our services gross margin. Our adjusted EBITDA loss was $6.2 million for the quarter, which was better than expected, largely due to higher total revenue than expected and additional cost savings we realized in the quarter. We continue to drive savings across our business from reduced hiring, lower variable compensation, reduced program spend, as well as the continued benefit from lower travel expenses as a result of our virtual work environment. We have also taken additional steps to realize the benefit to our sales team of working in a virtual first world. As a result, the number of quota-carrying personnel is down slightly from the beginning of the year, and it's expected to be below 60 by the end of the year. As a result of these actions, we now expect to save a total of $22 million in 2020, which is $4 million above our previous forecast. Our free cash flow burn in the third quarter was $15.7 million, which was slightly below our expectations and was driven mainly from an increase in customer payment deferrals. As of the end of the third quarter, approximately $26 million was included within accounts receivable related to payment deferrals provided to our customers. From a balance sheet perspective, we ended the quarter with a cash balance of $322.4 million, up $102.2 million sequentially due to our successful completion of a convertible debt offering in early September. Net proceeds from this transaction were $120.9 million after the purchase of capped call transactions. Our strong cash balance provides us with great financial flexibility as we look to invest further in our vision of powering digital selling. Now before I cover guidance, I want to cover the continuing impact COVID is having on our business. Many of our customers, especially those in travel-related industries, continue to be significantly impacted by COVID. While we have seen signs of slight improvement in certain areas, it is clear the pandemic continues to impact the global economy and the impact will last longer than we had originally hoped. The pandemic has impacted several aspects of our business. First, our subscription bookings from new and existing customers this year are anticipated to be down by approximately $25 million from last year. Second, we have responded to some of our hardest hit customers by granting extended payment terms. And as I mentioned earlier, This has had the impact of delaying a total of $26 million in cash collections out of the first three quarters of 2020 and into the fourth quarter and into 2021. And finally, in a smaller number of instances, we have agreed to amend previously signed contracts. For example, we agreed to delay some implementations, restructure certain customer agreements, and in one case, agree to cancel a contract after a customer declared bankruptcy. We currently estimate the annualized revenue impact from these contractual changes could be up to $18 million. We do expect much of this impact to be recovered in future years as our customers rebound from COVID. With this information as added insights into our business, I will provide our guidance for Q4 and the full year 2020. We expect our annual recurring revenue, or ARR, to be between $207 and $209 million at the end of 2020. Lower estimated in-year bookings, customer bankruptcies, and customer contract restrictions are expected to negatively impact ending ARR. Our estimated gross revenue retention rate for the year is expected to be in the range of 88% to 89%. Now, absent the impact of COVID, our gross revenue retention rate would be in the 92 to 93% range, which is consistent with our renewal rate from last year. We expect Q4 subscription revenue to be in the range of $41.1 million to $41.6 million, up 2% year-over-year at the midpoint. We expect our full-year subscription revenue to be in the range of $168.7 million to $169.2 million, up 16% year-over-year at the midpoint. Again, lower end-year bookings, customer contract restructurings, and customer bankruptcies, all resulting from the COVID pandemic, have significantly reduced the growth rate we expected for 2020. We expect total revenue to be between $58.9 and $59.9 million in the fourth quarter and between $250.5 and $251.5 million for the full year. We expect our adjusted EBITDA loss to be between $8.1 million and $9.1 million in the fourth quarter and between $31.5 and $32.5 million for the full year. Our efforts to reduce costs by an estimated $22 million will allow us to minimize the reduction to our adjusted EBITDA loss for the full year. We expect our free cash flow burn to be between $60 and $65 million for the full year. And this implies a roughly $10 to $15 million free cash flow burn in the back half of 2020, which is a significant improvement from the first half of 2020, but higher than what we forecasted last quarter and largely driven by the impact of customer payment deferrals that I mentioned earlier. Lastly, with an estimated non-GAAP tax rate of 22% in the fourth quarter, we anticipate a non-GAAP loss per share of between 16 and 18 cents per share, based on an estimated 43.4 million basic shares outstanding. We realize this pandemic will continue to impact our customers for at least several more quarters, and we are purposefully approaching these challenges with a long-term view. We remain committed to delivering value and insights to our customers, and we are confident in our long-term market opportunity, as we believe powering digital selling will be more important going forward. We thank you for your support of PROS, and we look forward to speaking with you at our upcoming events. So with that, let me turn the call back over to the operator for questions. Operator?
spk08: Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Our first question comes from Tom Roderick with Stifel. Please go ahead.
spk05: Hey, everybody. Great to hear from you. Thank you for taking my questions. Andres, I'm going to start with you, and I'll just kind of rip some data points from your outperform user conference from one of your Brazilian airline operators, but I think they're kind of indicative of what you're probably seeing from a lot of your airline customers around the world. I think the numbers are something like the operator was operating 950 departures a day that fell recently. you know, to 70 in March and has since recovered to maybe 500 departures a day. But, you know, as we sort of look around the world, we're seeing similar, you know, modest recoveries, not all the way back to where we were, but they are recovering. So I guess in that context, I'd love to hear how your conversations are going. It looks from the subscription revenue and the churn numbers that you've given that you're hanging in there pretty well. So I understand it's not an environment where they can necessarily buy, you know, net new software and think all that strategically. But what are the discussions like and when do you think the spending patterns might return, if not to normalcy, at least to some level of growth off this low level?
spk04: Yeah, Tom. Hey, great question. Yeah, I would tell you, look, there's been slight recovery and they're starting to see some, but it varies by area. We've seen some airlines have been impacted more than other areas, depending on the region of the world they're in. But overall, I think, look, we've aligned very closely to support them and have very close collaboration with all of our customers. They still see a ton of value from our solutions. and the new innovation especially around digital commerce i talked about in in my prepared remarks around qatar expanding with gso i think airlines are leaning in much harder to self-serve as you've seen many airlines have taken out all fences, which means that you can cancel at any time. And in those abilities now, for them, it's really important that passengers, whether it's group or individual passengers, can be more self-serve. So a lot of our innovation has been focused on how we help them support that in a full frictionless way to both improve customer experience and as well, let them adapt quickly. So overall, I would say, look, the conversations are improving. I think airlines are very focused on building a recovery plan and we're supporting them through that process as well as helping them think of what the future looks should be and how we innovate towards that future. We also launch our new dynamic pricing capabilities that aren't constrained by fair classes, which are going to be very high value to airlines as they bounce back and recover.
spk05: Yeah, really, really, really helpful. And then maybe I could just pivot to the B2B side. The flip side of the bad news on airlines is we're getting all this data that the GMV on e-commerce platforms like Demandware and Magento are up 90%, 100% this last quarter. That's not likely to maintain forever, but it has, to your point, sort of changed the nature of how people shop. Talk a little bit more about how your B2B customers are leaning in to ancillary complementary solutions on the dynamic pricing side. How much of that is tied to e-commerce purchasing and how much of it can actually be tied to, you know, to GMV and downstream behavior that results from, you know, from just more transactional activity amongst your existing customers?
spk04: Yeah, so on B2B, we're seeing strong logo wins. And what we're seeing, especially this area of driving CPQ and our price guidance solution, in looking at use cases beyond powering your typical negotiated channels. And I talked a little bit about this earlier. in my prepared remarks, but we're seeing companies think about e-commerce and marketplaces, and that being a very strategic area. We launched both our Magento connector this last quarter. We also launched our price guidance and control solution with the SAP commerce platform as well, both in their marketplaces, predominantly due to what we see demand of a lot of companies in B2B thinking not just how they support B2B commerce, but some of them from a brand perspective, looking at direct-to-consumer models as well, where we brought a lot of experience historically. And frankly, we're one of the, probably the only company that can help B2B companies as they think of the B2C model and the direct-to-consumer from a digital perspective. So those areas are areas that we see resonating in the market. in companies kind of looking at focusing more on those areas than just the direct sales model.
spk05: Wonderful. Really helpful. Thank you. I'll jump back in the queue. Thank you.
spk08: Next question comes from Stan Zlotsky with Morgan Stanley.
spk09: Please go ahead. Hi, this is Elizabeth Elliott on for Stan. I was learning you could provide some color on the B2B selling cycles. Last quarter, you mentioned there was some lengthening of sales cycles. So curious how that's changed this quarter and what your customer conversations are like and what you're expecting for trends next quarter.
spk04: Yeah, that's a great question. So we've seen a slight improvement from what we saw in the first half. So still I would say, you know, not back to what it was pre-COVID, but definitely we saw a positive uptick in Q3. And we're seeing a lot of organizations, I think, were trying to understand how COVID was impacting them, also trying to understand what they needed to do internally to help support their customers and their go-to-market. And we're seeing more of them now wanting to take action and move forward. We also did quite a bit of innovation in areas where we allow them to land in much smaller scope with much faster time to value. And we're seeing this resonate well in the market as well.
spk09: Great. Thank you so much for the color. And then just as a follow-up, digging more onto the travel side, I'm curious, do you still expect to see 2021 as the year we could see bookings start to return here?
spk04: Look, I would say still premature. We would hope that going into 2021, the environment continues to improve and their load factors continue to increase. But I would say at this point, it's still premature to call out and say that travel will be back to historical norms next year. We see things slightly improving. And we're continuing to monitor, but it's still, I would say, premature to call out 2021. Yep.
spk08: Thank you. Thank you very much. Yeah. Next question comes from Alex Zukin with RBC Capital Markets. Please go ahead.
spk06: Hi, this is Robert Simmons on for Alex. Thanks for taking our questions. I wonder if you could give us a little more color on your customer bankruptcy situation, like how much of your base has actually filed for bankruptcy, either 7 or 11, and what have you seen so far in terms of them continuing to pay you through Chapter 11?
spk00: Yeah, so Robert, this is Stefan. I'll take that. We really haven't seen any increases in bankruptcies in the last quarter. So, you know, the numbers we were looking at and the impact that we were thinking about at the end of last quarter is very similar to what we're seeing now. So that number remains to be the same. And in terms of as a percentage of the total, it's a very small percentage. So I think last time we talked about it was eight bankruptcies, but we had unfortunately had missed one, so it's really nine. It was a small one, but it had been factored into the calculus. So right now it's nine customers that we've seen with an impact, which is consistent with where we were last quarter.
spk06: And have you been able to be designated as, what was the term, mission critical or, you know, business critical? Yeah.
spk00: Yeah. So I think last quarter we had talked about the fact that there was one of the bankruptcies where they had leveraged the rules on bankruptcy to cancel the contract. To date, that's the only time that's happened. And so all the other eight in this case have continued to use us. And I think the term is critical vendor. I think this is the term you're looking for. And And in many cases we have been deemed that, but not in all. But that doesn't necessarily determine whether or not they're going to continue to use us or not. It just really depends on how they're going to handle the pre-petition payments that are due. But in all cases, other than that one, our customers are continuing to work with us and continuing to pay their bills, actually.
spk06: Okay, great. And then can you just talk a little bit about what you've seen by geography? Like how is Asia performing in Europe, the Americas? Where do you see it being better or worse?
spk04: Yeah, I'll handle that. What we've seen is Europe, we've seen perform well. It's been one of the areas that frankly, we're pleased with how it's been performing. And we're continuing to see strong demand coming out of Europe. Areas that we have seen impact have been most rest of world and the Americas.
spk06: Got it. Chris, thanks for those questions.
spk08: Next question comes from Jackson Ader with JP Morgan. Please go ahead.
spk05: Great. Thanks for taking my questions, guys. First one on the sales reps and the expected decline here toward the end of the year. As you look at maybe the start of 2021, you know, the remaining cohort of reps, any sense you can give us for the tenure of those reps and compared to maybe the cohort that started out in 2020. And then just a quick follow-up on those same sales reps. I assume the mix will be more heavily weighted toward B2B than they were at the beginning of the year. But any color you can get there as well would be great.
spk04: Yeah, so a couple of points. So the changes that Stefan talked about in terms of reduction to quota care and personnel, all of that has happened early in the fourth quarter and predominantly has been some positions that we eliminated on the travel side and some performance oriented. And for us really was preparing for getting an advanced preparation for 2021. So in terms of average tenure, no major changes in that. We have a pretty strong sales team continuing to build it. We expect to continue to invest in the sales organization, but start preparing for 2021.
spk05: Okay, great. Thanks. And then a follow up on there was a press release, the ANA press release for the other day or the other week, you know, about about their kind of move to the cloud. Was this something that was planned all along? Was it actually accelerated because, you know, the need for the digitization because of the pandemic? You know, did it factor into their decision at all?
spk04: Yeah, this was a very strategic initiative for them that started early and was very important for them to continue and go live during COVID. And I would tell you that this was a very strategic initiative for them. They wanted to be able to leverage our latest generation technology and our latest generation science. And we worked hand in hand. This was one that I commented that we did fully, you know, virtual go live in joining between organizations and was a very huge success amongst both of our teams and our team. But it was a very strategic initiative for them.
spk08: All right.
spk05: Okay. Thank you.
spk04: Yeah.
spk08: Next question. comes from Jason Salino with KeyBeg. Please go ahead.
spk02: Hi. Thanks for taking my question. One for Andres. You talked about the companies leaning into online, low touch, and no touch channels. Which of these modes do you think have more immediate opportunities or where you're seeing the most interest? And then maybe can you tie into which solutions would be used for these?
spk04: Yeah, so we're seeing both areas. We're seeing organizations leaning to how they're supporting more of a low touch by leveraging more guidance and CPQ solutions. both for traditional negotiated channels as well as partner or e-commerce. And in terms of the solution mix, what we're seeing a lot and where we've seen an incremental is selling the CPQ and our guidance solution combined. So really getting our integrated platform to help support both the negotiated and non-negotiated channels.
spk02: Okay, great. Thank you. And then one quick one for Stefan. You know, when we think about visibility, I know things are still pretty cloudy, but what are some internal processes that you're implementing with your sales teams and your pipelines to kind of project, you know, future opportunities? And then your kind of confidence maybe today in visibility versus three months ago.
spk00: Yeah, I think when Andres talked about the cycle times and some of the things we're doing around our kind of shifting our B2B focus from you know, say larger transactions to more land opportunities, you know, those are those typically are higher predictable transactions because they're not they don't require as much of a of an approval process from the, you know, from the the the customer. And so that's giving us a better feel for for how, you know, the future is going to look and also to risk some of the transactions, because as you might imagine, larger transactions typically are, you know, less predictable because there are even in normal times more of an approval process. So I think the land motion that we really started to develop in the third quarter and we're seeing moving forward into Q4 and beyond, I think that's just going to help us get a better feel of how that pipeline is going to convert. And, you know, so Q3 was the first one that we saw that. And to Andres' point, we did see some momentum coming from it. And ideally, we'll continue to see that if we go into the fourth quarter as well.
spk04: Okay. Thank you. That's very helpful. Thank you.
spk08: Our next question comes from Chad Bennett with Craig Hallam. Please go ahead.
spk01: Great. Thanks for taking my questions. So maybe for Stefan first. So a couple for me. Just on the $26 million in kind of payment-related relief you gave customers that's reflected in account receivables and the $18 million in, I think, amendments you indicated to contract terms, I guess, are those numbers, I assume they're reflected in the billings or deferred revenue on the recurring side, but are they also reflected in your year-end ARR number, or are they still in that number?
spk00: Yeah, so good question, Chad. Just for clarity, the $26 million, if you will, deferral of payment terms, those would be in the ARR number and they would be in the calculated billings number. So they're invoiced and they would be counted. The other component, the $18 million number that you're referring to, in many cases, is not. Some cases it may be, and in many cases it will not be included because we will not have billed it.
spk01: And that wouldn't be in the ARR, obviously.
spk00: That is correct.
spk01: And then do we, I guess, in terms of heading into year end, Do we anticipate kind of more of this kind of headwind or activity for the next quarter or two, or do you think the worst is behind you?
spk00: You know, I'd love to say the worst is behind us. I can certainly tell you we have a customer success team that has been really working hard to work with our customers and find ways, not just structurally from a contract perspective, but how we can actually come beside them and work with them in the new reality that we're all working with. So there's been a tremendous amount of work put together to help our customers along during this time period. So I would tell you we're pretty engaged with our customers in that regard. And so we certainly have had conversations with just about all of our customers at this point. I think the question really remains, how long is this going to continue to play itself out? I think one of the questions that came up earlier is, when do we see passenger boarding metrics start to get closer to where they were pre-pandemic? And it's just really hard to say. We've seen some improvement, but we still have a ways to go before we get there.
spk01: And then maybe one last one for me. Just in the $22 million in cost savings you cited, I think thus far, but maybe for the full year. I mean, OpEx was kind of flattish sequentially on a dollar basis. How much of that is reflected in the P&L, and how much is ahead of us?
spk00: So, you know, the $22 million number is actually from Q2 through Q4. So, Uh, that's where the bulk of it is, is, um, well, that's where all of it's going to be generated and it is, you should see quite a bit of it coming in the fourth quarter. So, uh, not quite a little bit more than a third. Let's put it that way. And by the way, Chad, real quick, just to clarify, this is versus what we had guided to spend at the beginning of the year, not necessarily off of what we spent last quarter. So just to make sure the reference point's the same.
spk01: Got it. Thanks for the clarification.
spk00: Yep. Thank you.
spk08: Next question, Joshua Riley with Needham. Please go ahead.
spk03: Hey, guys. This is Josh on for Scott. What kind of interest are you seeing from clients in adopting the dynamic pricing for airlines following that product launch at Outperform? Do you think that COVID will accelerate the timeline to move away from the fair class system? And then how do you think the big three will adjust their pricing strategy for the current market environment? Thank you.
spk04: Yeah, so I would tell you, look, there's a lot of interest. I think airlines right now, the biggest challenge is that they're still on very light staff. And from an internal people standpoint, they don't have the resources to embark on a new initiative. But there's definitely, there was a very positive reception to our new willingness to pay algorithms there. And I believe that as they start coming back and bringing some of the employees back from furlough, we will see strong interest coming out. But right now, it's hard to predict when that will be. Okay, great. That's all I had. Thank you.
spk08: Ladies and gentlemen, we have reached the end of the Q&A session. I would like to turn the call back to Shannon Katz for closing remarks.
spk07: Thank you for listening to today's call. We look forward to speaking with you at conferences and events this quarter. As Stefan mentioned, playback of our content from our Outperform Customer Conference is available on our website. This quarter, we will be attending the Steeple Midwest Growth Conference on November 11th, the RBC Capital Markets Global TIMT Conference on November 18th, and the Needham Staff Conference on November 19th. We will also be marketing virtually with Baird in December. If you have any questions following today's call, please contact us at iratprose.com. Thank you.
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