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Operator
Good afternoon, everyone, and welcome to Mobility's second quarter 2024 earnings results call. Hosting the call today are Bryce Daniels, President, and Kim Carlson, Chief Operating Officer. Before I turn the call over to management, I'd like to call everyone's attention to the company's safe harbor policy. Please note that certain statements made on this call are before-looking statements, which are subject to considerable risks and uncertainties. We caution you that such statements reflect the management's best judgment based on factors currently known, and the actual results or events could differ materially. Please refer to the documents filed by the company from time to time with the SEC, and in particular, its most recently filed annual report form 10-K. Those documents contain and identify important risk factors and other information that may cause accurate results to differ from those contained in the forward-looking statements. Any forward-looking statements made during this call are being made as of today, August 14th. If the call is replayed or reviewed after today, the information presented during this call may not contain current or accurate information. Except as required by law, the company assumes no obligation to update these forward-looking statements publicly or to update the reasons actual results could differ materially from those anticipated in forward-looking statements, even as the new information becomes available in the future. Today's call may include non-GAAP financial measures, which require a reconciliation to the most direct, comparable financial measures, which are calculated and presented in accordance with GAAP and can be found in today's press release, along with our recent corporate presentation, which is also available at mobility.com. With that said, I'd like to turn the call over to Bryce Daniels, Mobivity's newly appointed president. Bryce, the floor is yours.
Bryce
Thank you, Brett, and good afternoon, everyone. We appreciate you all joining us today for Mobivity's second quarter 2024 earnings conference call. For investors new to our story, Mobivity is a marketing technology company that connects brick-and-mortar brands to digital audiences and vice versa. Our connected rewards platform drives valuable customers and users between in-person and digital environments in all possible channels. and we generate high margin revenue from powering those interactions. I'm pleased to report that Q2 2024 was another quarter of significant growth and progress for Mobivity's Connected Rewards platform. Some key highlights from Q2 are we announced a strategic technical integration and partnership with Patronix, a leading provider of loyalty and payment technology to brick and mortar brands. Our integration and partnership make a brand's integration with our platform nearly seamless. This enables us to quickly bring thousands of Patronix customers to Mobivity, which can deliver material scale in Q3 and Q4. We expect to announce similar partnerships with other premier loyalty providers in the near future. We grew revenue in our connected rewards business by approximately 20% compared to Q1 2024. This marks three quarters in a row of growth at that level, and we expect that to accelerate. Our audience reach expanded by about 40%, and the number of active programs increased by roughly 10%. We added a substantial number of new brands to the platform and nearly doubled our pipeline since Q1. Revenue per action taken continues to climb as our programs continue to outpace all performance measures, delivering exceptional results for both our brand and game publishing partners. I want to emphasize that we expect to be 100% focused on Connective Awards by the end of Q3. we've continued to reshape and right-size our company to fit this framework. While there's still more to do, we're very pleased with the progress that we've made in transforming Mobivity. Our success continues to be driven by the simple yet powerful formula I've highlighted before. Mobivity's revenue is the product of our audience size, conversion rates, and revenue per action. In Q2, we made substantial progress on all three growth levers and showed increasing results for our partners, giving us even greater confidence in our continued growth trajectory. With that, I'll now hand the call over to Kim Carlson, our COO, for more details on our Q2 operational progress and outlook. Kim?
Kim Carlson
Thank you, Bryce. Mobivity's Connected Rewards platform continues to target the massive mobile user acquisition and retention market, which annually spends over $40 billion. Our performance-based channel is resonating strongly in this market, as evidenced by our Q2 results. In Q2, we continue to see exceptional results from our Connected Rewards programs. Though still in the early innings, the 20% quarter-over-quarter revenue growth in this segment underscores the increasing market adoption of our platform. Our partnership with Patronix potentially opens up thousands of new customer opportunities and streamlines our integration process to many more potential product applications. This partnership is already delivering results and as we add more valuable partners, we expect to see material results in Q3 and Q4. The nearly 40% growth in our audience reach and 10% increase in active programs demonstrate the scalability of our platform. As we expand our brand partnerships and deepen our relationships with game publishers, we're creating a virtuous growth cycle that has been proven in our partnership with national brands like Chevron and Marathon and has recently shown promising results for regional convenience brands like TXB and Yesway. We've leveraged these results to build our pipeline, which has almost doubled since Q1 and is, I'm happy to say, more robust than ever. This gives us confidence in our ability to continue scaling rapidly through the remainder of 2024 and beyond. As we progress through the year, our focus remains on optimizing our platform, expanding our partnership, and capitalizing on the vast potential in the mobile user acquisition and retention markets. The transition to being 100% focused on connected rewards by the end of Q3 will further streamline our operations and accelerate our growth in this high potential segment. With that, I'll return the call to Bryce for his closing remarks.
Bryce
Thank you, Kim. In summary, Q2 represented another quarter of solid growth and strategic progress for Mobivity. The continued expansion of our connected rewards business, though still in the early stages, coupled with our Patronix partnership and growing pipeline, positions us well for accelerated growth in the second half of 2024 and the coming years. Our transition to a pure play Connected Rewards company is nearly complete, and we're excited about the opportunities this focus will bring. Connected Rewards offers a powerful new approach to driving customer engagement, represents a massive market opportunity, and Mobivity is the best position to capture this market. As always, we direct investors to our public filings for detailed financials. Operator, please open the call for questions.
Kim
Thank you.
spk04
Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the number one on your touchstone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the number two. If you are using a speakerphone, please leave the handset before pressing any keys.
Bob Berlacher
One moment please for your first question.
Kim
Again, if you would like to ask a question, please press star followed by the number one on your touch-tone phone. Thank you. And your first question comes from Bob Berlacher. Please go ahead. Your line is open.
Bob Berlacher
Again, Bob Berlacher, your line is now open. I'm sorry. Can you hear me now?
Bryce
Yeah, we can hear you now, Bob.
Bob
Okay. Sorry, Bryce. Can you break out or give us any indication Of the million four, roughly million five for the quarter, what percentage is your legacy type SMS business versus the connected rewards business?
Bryce
Yeah, without going into too many specifics there, we're kind of on two-thirds, one-third split at this point with our legacy to our connected rewards business. So, you know, still in the early innings of connected rewards, but we see As we mentioned in our prepared remarks, we see positive signs of growth in all the factors that would lead to substantial revenue growth, and we expect to see that grow pretty materially through the end of the year.
Bob Berlacher
Okay. Thank you.
Kim
Again, if you would like to ask a question, please press star. followed by the number one on your desktop phone.
spk04
And there are no further questions at this time. This includes our question and answer session. I'd like to turn the conference back over to the management team for any closing remarks.
Bryce
I'd just like to say thanks, everybody, for your support, and we look forward to updating everybody on our continued progress through the end of the year, and thank you very much.
Kim
Ladies and gentlemen, this concludes today's conference. We thank you for participating and ask that you please disconnect the line. Thank you.
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