My name is Fabiana Lawant. I'm Director of Investor Relations, and I'd like to inform you that this event is being recorded and translated simultaneously. I have Silvio Stagni, the company's Chief Executive Officer, and Gustavo Antunes, our Chief Financial Officer. I'm going to pass the floor to Silvio, who's going to present the quarter highlights.
Thank you, Fabiana. Welcome everybody. Thank you so much for your presence in this event. Last night we announced the company results for the fourth quarter of last year, and consequently first quarter results. Now we have the space to go into a little bit more depth into our results.
Our agenda is the traditional one that we usually follow, and I'm going to go through a few qualitative highlights of the first quarter, and then I'm going to ask Gustavo to jump in and go into the figures, and then we're going to wrap up with a question-and-answer session. All right. We always start remembering the three main pillars of Allied. We have digital retail, B&M retail, and distribution. In digital retail, we have 37 stores. These stores, they have our own brand, which is Mobcom, present in the main Brazilian marketplaces. But we also do 3P of brands like Apple, Google, HyperX, Xiaomi, as well as the iPhone Forever program, which is under the digital retail umbrella. It's a program that we have in association with Apple and Itaú Bank.
In addition to iPhone Forever, in this program, we also have a solution that's very similar to Xbox and all Microsoft games. In the Itaú app, the account holders, they have more options. We have 132 B&M stores, 131 Samsung ones, mainly present in southeast Mato Grosso do Sul and Paraná. One Trocafy. And in distribution, we distribute several different brands of electronics in general to Brazil. The news here is that we started an international operation in Miami, so Allied Miami, initially distributing Apple to all of Latin America. These three pillars lead us to have 9% of notebook market in Brazil, 31% of the video games market share, and 13% of the tablets market share. We have a pretty relevant presence in all of the markets that we act in. Let's start talking about the results.
In this first quarter, we had BRL 1.4 billion in net revenue, in line with the first quarter of last year. We always like to make a comparison with 2019, which is the pre-pandemic year. Because 2021, there was a boom in terms of electronic demand, and we're pretty glad to see that we were able to keep running on that growth that we've had in the last pandemic years. If you look at 2019 onwards, we have a CAGR of 17.1%, and this is formed by the distribution with BRL 996 million. BRL 221 million in digital retail, a growth of 9% in comparison to the first quarter of last year. And B&M retail with BRL 145 million, a drop of 2% in comparison to the first quarter of last year. It was a hard semester. The demand for electronics, it decelerated a little bit.
Taking the GfK numbers that measure the market sell-out, in the first quarter, we had a drop in the value of the market in terms of 10% in smartphones, 14% in notebooks. This market shrunk in electronics. We were able to, however, maintain the same level of sales that we had last year. In the next slide, we can see our market share. Here we have some good news. We always measure our market participation to understand our relevancy. Here we have three categories in which we had a lot of success. Comparing the first trimester of 2021- 2022, video games is one of the best markets. We pretty much doubled in terms of volume. The comparison, 2023 and 2022. A 13 point growth in comparison to last year. Tablets suffered a little bit.
If we compare the first quarter of 2023 and first quarter of 2022, we grew 3%, and our market share went to 13%, a growth of two points. In smartphones the market dropped in 16%, we dropped in 9%, so we dropped less than the market did, which led us to an 8% share of the market, a growth of 1%. Now let's go into each one of the pillars. I'm going to start with distribution. Distribution. The big news was the beginning of our international operations. In January, we began Allied Miami, initially selling Apple to all of Latin America, with exceptions of countries in which Apple has a B&M presence. We don't supply Brazil through Miami. We supply it directly. If we see in the graph, in the first quarter of last year, we already had an international operation.
These consisted in a few isolated businesses that we established to test the concept and to understand whether we would be successful in this endeavor. We decided to go forward with that, in the first semester we had BRL 302 million in terms of net revenue. We had estimated that we would have a revenue of BRL 600 million throughout the year, and yesterday we released a new estimate adjusting that number because we believe that our net revenue will be around BRL 1 billion and BRL 1.2 billion for the year. We began strong. We're going through 16 countries through this initiative. There's an expansion to happen, and we have a single product today and we're going to expand to more. Miami can also be a hub to bring products to Brazil from brands that are not present today.
We're already in conversation with several brands, and we believe that we're going to have some good news in the international front. We had a drop in distribution in Brazil of BRL 864 million- BRL 600 million. The first quarter of 2023 had the impact of Americanas, which was a big client for us of BRL 100 million a year. This drop, it impacted Q1 strongly, but the situation has already changed. We're already selling to Americanas again. In some categories, the market has been supplying the volume that was dropped by Americanas, so we believe that this impact will be passing. In terms of margin, we opened a margin of international distribution and Brazil distribution, and these are very different. In international distribution, we have a gross margin of 2.3%, which is significantly less than Brazil. It is a positive cash flow operation.
Purchasing and selling in the United States is very different from here. The receiving deadlines are direct, we can generate a positive cash flow even though we have a lower margin than Brazil distribution. This is a business that brings us quite a bit of profitability. Also in distribution, if you go into B&M retail, I just want to go back and tell you a little bit about a couple of things that we had already mentioned, just to remind you. Throughout 2022, in 2021 and 2022, actually, we closed the operations that we call store-in-store, which were those kiosks within retailers like Marabraz, Toha, several retailers in which we had an electronics kiosk, and we sold in the name of these retailers. After the end of the pandemic, the volume of people traffic, we understood that we should close this line of business down.
If we look at the first trimester of 2022, we had 222 stores. Now looking at the first quarter of 2023, we have 132 stores. Throughout last year, we also started optimizing the process, reducing costs significantly, and the results can be seen here in the graphs that you see on the right. In the first quarter of last year, we had net revenue per point of sale of BRL 209,000, and in the first quarter of this year, we had a net revenue of BRL 364,000. It grew 74%. In the graph below, we make a comparison between 2021 and 2022 to show the improvement in process and cost reduction.
If we take 2021 as a basis and use 100 for net revenue and 100 for cost, when we reach the first quarter of 2023, our revenue is 123, it grew 23% in comparison to 2021. However, costs have dropped to 97, 3% in comparison to 2021. In 2022, the reference number was 126, quite a bit less than that. There was a very strong work in terms of cost optimization. We started seeing the results in our B&M stores. The third pillar. Well, before that, in the first quarter, we had an important event, which was the launch of the Galaxy S23. Samsung's launches are the most important times of the year for the Samsung stores. Usually, there's one in the first quarter and one between the third and fourth quarter. In the first, we launched the Galaxy line.
We launched the Galaxy S23 with several special packages for consumers. You could pay for one memory, take double that. We had trade-ins of their used devices in an over-evaluation. The launch of S23 was a global success, and it was a success in Brazil as well. Third pillar, digital retail. We continue growing significantly. If we look at the market, digital retail in the first quarter of 2023 dropped 17%, and we grew 1%. If we look at the last 12 months, we reached our digital retail net revenue of BRL 1 billion. How have we been able to do this? We are more present in full operations of partner marketplaces. Meli, Amazon, we were in B2W, and now talks are happening. We have sponsored ads, links in Amazon and Meli.
To foster sales, not just of smartphones, which is the flagship of Allied Tecnologia S.A., we set up a commercial team for our digital retail dedicated exclusively to non-mobile products. We started seeing a growth in a field in which we did not act as much. We have new suppliers like Philco and Electrolux. We have a significant path of growth there. In the next page, this is to inform you of three growth drivers that we have been mentioning in all of our presentations. First is Trocafy, our new brand. Our company for selling reconditioned products. We started in May 2022. We just closed the first year. What did we do this year? First of all, we have invested heavily in the brand. The brand started seeing a higher level of awareness.
Second, in addition to launching the website and having a B&M store with the Trocafy brand, today, we already have Trocafy in Mercado Livre. One important piece of news, Trocafy was created based on the iPhone pra Sempre program. After 21 months, consumers have the right of returning their used iPhone and getting a new one and restarting the program. This used iPhone is refurbished and sold through Trocafy. Now we expanded our capturing of refurbished products. In all of our Samsung stores, we have Trocafy offering a trade-in for consumers. Consumers could go into the Samsung store, and they have the option of Trocafy as an option of selling their used products in the purchasing of a new one. There is quite an intensive rhythm of growth for Trocafy, and it is one of our growth drivers. The second driver, B2B.
It is something we have been investing heavily on as well. We have verticals in education, in government, in IT. In May, we are launching our digital platform. That means that our resale will be able to very quickly quote any product through our digital platform, through our Allied Empresas page. With that, they will be quicker to make offers to the market. We expect quite a significant improvement in that front. We started bringing in new products and new services of B2B. So different memories, extended warranties, offers. We are expanding our supply, which will also help in that growth. Lastly, SCD, our financing mechanism. We are becoming an SCD, Sociedade de Crédito Direto. It will significantly reduce our operational costs. We are producing new products. We have Crédito Misto, and this expands what we can offer to our clients.
We continue to expand in terms of points of sale. We are in 368 points of sale already. A solution that was created for our Samsung stores, for 131 Samsung stores, we have expanded to more Samsung stores of other partners, and we have also expanded into mobile operators. The growth has been conservative, but quite intensive. Now, I would just like to go into the figures of the last 12 months. BRL 6.2 billion in terms of gross revenue, with BRL 272 million of adjusted EBITDA and BRL 74 million in adjusted net income, 132 points of sale. In all of our contacts with clients, we measure the Net Promoter Score, and we can see that for the Samsung stores, we have our 82 points, which is quite high. 37 online stores and a market share, 9% in notebooks, 13% in tablets, and 31% in video games.
We have quite an expressive presence in all of the markets that we act in. Before I pass the floor to Gustavo, I'd just like to mention that we had the fortune of being able to help in the disaster that happened in the northern coast of São Paulo. We engaged with our collaborators and donated mobile phones to organizations that were supporting people of the region who were affected by the rains. Now I'm going to pass the floor to Gustavo and ask him to give us some details in terms of our financial results.
Before I pass to Gustavo, I'd just like to make a quick comment. Like Silvio mentioned, after Gustavo, we're going to begin our question-and-answer. Whoever wishes to send in questions, you can use the webcast chat. I'll take this chance to say that any statements that we make in terms of projections, these are estimates, and they're subject to taking place or not. These are not guarantees.
Good morning, everybody. This is a recent history of the company and its results. Here we can see that our strategy of developing distinct channels and new product categories has been coming to fruition and providing results. We were able to benefit not just from recently, from a heated-up market and the products that we sell, but also now in a retracting market, in a shrinking market, we're able to have a similar threshold of revenue. This is a reflection of us bringing new initiatives that offset the initiatives that could be suffering. All of this to say that we are closing our first quarter with a net revenue of over BRL 1.3 billion.
In adjusted EBITDA and in adjusted net income, we can see that this company is able to, with a relatively simple structure, benefit a lot from the times of a market boom, a market rise. On the other hand, when the market retracts, we return to our historical range, so we don't drop too much. We're closing with an EBITDA of around BRL 77 million, BRL 16 million of net profit. On the next page, we break down the distribution. In the distribution in which we sell to other companies, to end users, to end consumers, we've developed the corporate market. We had a capillarity in small retailers, a larger concentration of national retailers. Right now, we have many regional retailers. This mix of categories provides us with revenue that's in line with last year.
Even though we're in a market, the smartphone market that we mentioned, it dropped 10%, and laptops 14%. Due to our diversification, we were able to maintain our revenue threshold. When we look at the margin, we have Brazil with a margin of 8.5% and international distribution close to 2.5%. Just to remind you of a point that Silvio mentioned. Grossly speaking, international distribution, we get the orders directly. We pay our partners in around four to five days, and we have a very quick storage flow of around two to three weeks. This makes the operation very light, and it generates a lot of cash flow. It's different from Brazil. It's an operation that we are going to give more details on after more market interaction, but it has already come to fruition in the first quarter.
It made us review our estimates for the year, like you saw. We're quite excited about these results to add to our presence as a large distributor. On the side, we see a mix of low-ticket products going down, especially e-readers, accessories for laptops and phones. In 2021, there was a period of high demand. The average ticket has risen, but particularly when we go to the graph below, when we measure the percentage of mobile, and so phones and tablets in our product mix. This effort historically floats around 55%. We've 67%, which is due to a market of laptops that's little less with a higher than average ticket. This is a point that has driven this, and it also stresses the point that we have quite a diverse distribution. The next part, we go into our retail.
In the left upper side, we grew around 9%, reaching BRL 220 million in the first quarter. We believe that this is an effort of being able to operate better within the rules of each marketplace. We have 37 stores in several different marketplaces. We can have more than one store in the same marketplace, so we can represent a brand like Google or Xiaomi, and we can have our own Mobcom brand within the same website. For sure, knowing the specificities of each marketplace helps us in operating better. I'd also like to remind you that in 2022, in digital retail and e-commerce, there was a tax dispute that, in a way, the economic players and agency had different understandings in terms of the tax burden to be priced in operations.
This dispute, this divergent understanding, has been overcome, in 2023, everyone has started operating under the same guidelines. That said, in 2022, Allied took a very conservative stance. We assumed that the taxes were due, but we questioned it judicially. We priced it as if we had the full tax burden, certainly that made us have a less favorable competitive position throughout 2022. In 2023, with everybody playing the same game, we were able to relatively be more competitive, and that made our growth overcome 9%, even in the hard market that we shown. In B&M retail, we have a mix of 90 less points of sale and a stable threshold of sales. The sale for our point of sales has been much more efficient. Our B&M retail, from the second quarter of last year, has become much more healthy.
On the right side, you can see that our retail floats around 30% of gross margin. That all said, when we move to expenses below the gross profit, we see that the company, especially in this market with a higher cost of capital, for a few months, we have been promoting and practicing an effort of expense reduction, avoid service rehiring if they are necessary, we've been able, in 2023, the first quarter, to deliver between BRL 8 million and BRL 9 million less than last year, BRL 4 million less of a better financial result than last year. It contributes to us closing the first semester with a gross profit of BRL 16 million. The first quarter is a period that, due to our seasonality, is a quarter for cash generation. We get the sales of the fourth quarter. We stock in terms of that.
The retail gets the payments in the beginning of the year. Not just that, when we look at the overview of our balance, we see that we have accounts receivable up with BRL 150 million less than we had. It received BRL 150 million. A stock in line with last year, and an accounts payable of BRL 6 million less. I'll move on two pages forward just to illustrate this. The combination of a rebalancing between the stock balance and suppliers, combined with a lower accounts receivable, actually made us overcome BRL 120 million, which was enough to fulfill with our investment obligations as well as reducing our leverage level. Certainly, we're going to talk a bit more about this throughout the questions. We closed the fourth quarter last year with 1.8x of net debt on the EBITDA over two months. This became 1.3x.
We communicated a very important fact, which is that we received from our insurer about BRL 80 million from the Americanas claim. This is the year in which we had a focus on cash protection, balance of cash flow, and risk capital, which will lead us to a lever situation that's healthy. We've been monitoring that constantly and assessing our risk as we were put to the test with such a large claim. That's my part. I know there are already quite a few questions, I pass the floor back to Fabiana.
Okay. I'm going to begin with the first question. It's from Marco Nardini from XP. I'm going to ask this to Silvio. He's asking you to comment about what we can expect in terms of the margin dynamics for the next trimesters, considering a rise in international operations. The second question is about the growth vision for the main business lines of the company for the year. Should we still observe a shrunken distribution for Brazil?
Okay. Let's begin with the margin. Our margin distribution always varies between 9%-11%. When the market has an overflow of demand, we can reach around that 11%. When the demand is repressed, there's excess storage and stock, we go to around 9%, which is where we are now. You mentioned our international distribution.
I think the most important point is that all international sales are an added sale to Brazilian distribution. Everything that we're doing in Allied Miami does not compete with Brazil. The margin mass will be higher with the addition of Allied Miami, despite the fact that the conjoining of both will bring a percentage number that's lower. For Brazil, we're going to be around 9%-11%, as we have been for the last years. Miami will probably have a margin of around 2%-3%, which is what we have now. Miami has a lot of room for growth because we're a new player. We have a single product there. We don't sell to all of Latin America yet, so we're going to add countries, we're going to add products.
Like I mentioned in my presentation, we are studying products that we can bring to Brazil. Brands which are not in Brazil yet. These markets which would not be in mobiles, laptops, computers, and video games, but some niche markets which could have some space in Brazil. That's the composition of the margin for now. A perspective for the year. This could be a personal opinion. I believe that for the remaining of the year, we're going to see a much better situation of demand than we had in the first quarter. Why do I think that? First of all, the main dates for sales, for promotions, they will still take place. That's Mother's Day, Black Friday, and Christmas. These three dates, they're very strong for electronics.
Black Friday has been established the last few years, except for last year when we had the World Cup. For the other years, Black Friday has been the main date for sales in Brazil. The three seasonal dates, they will still come. The mobile market is strongly driven by launches. At third or fourth quarter, we usually have the launch of the new iPhones. We're going to probably see iPhone 15 by then. We have the launches of the new Samsung foldables. I'm not sure if they're going to follow the same behavior that they've had in the last few years, but I believe they will. These launches, they drive the market. On our side, in the second quarter, before the iPhone's launch, we do iPhone Day, which has been extremely successful in terms of iPhone sales, which should also drive demand.
Two points which are more macroeconomic in nature. First, the first quarter had the impact of Americanas. It was very sudden and things started becoming more adjusted. Negotiations have advanced. The market segments in which they weren't able to return with the same intensity, the market started to offset that. The rupture has started to become mended, so to say. If you look at the report, we say that at the end of the year, the interest rates will be around 12.5%, lower than today, which should also drive consumption. We have several elements that would lead us to believe that demand would rise in the next three registers.
Next question. There are questions about the same theme. I'm going to summarize and ask you, Silvio, if you could give an update about Americanas.
Okay. Like Gustavo mentioned, we've received the value that we had in a claim with them from their insurer. Americanas has started buying and selling in the market again, and we've already started supplying them with items, so cell phones, printers, supplies, computers. We didn't leave the Americanas marketplace at any point. We're still there. The e-commerce is another place for market sales. We've maintained our products, so operator plans in the Americanas stores. Little by little, we are returning to normality with them. They're not at the same size that they were before, which is natural. There are limitations.
We believe that they will be able to officialize the terms of the traditional recovery, and they will once again have a significant presence in the market, maybe not the one that they had previously, but they will once again be a player in the electronic market. They have always been a very important player. Submarino was a very important marketplace for the market, and they are coming back, probably not at the size that they were before, but they are coming back.
I am going to move to questions from Thales. They are about the same subject. It is for Gustavo. What is the margin expectation for Miami if we reach BRL 1 billion in revenue? And what is the potential of Miami for the next years?
Okay. Thank you for the question. As we have been mentioning, it is the recent operation, and we understand that the results that we have presented in the first quarter, they should be more or less the economics of that operation. We do not see anything that is very distinctive from our estimates. There are natural variations of that type of operation. On the long term, I think it is still premature to have an idea about that.
We are still establishing our footing. We are very fortunate to be able to revisit and redo our estimate. In past presentations, we have given you a bit of an idea about the market that we are starting in there. There is a lot of public information about the size of that market. We have been investing first in being able to supply and establishing a market relationship with the clients that we already have products to sell to. We are adding more clients to that, of course. Secondly, we have been investing in trying to understand what other products and categories that we can add to this project. It is still a bit premature for us to understand the long term. We are not yet ready to give any robust analysis of that horizon.
The next question is from Leandro. He is congratulating on U1D results. A part of the question was already addressed by Gustavo’s comments, but I am going to ask Silvio if he could give more details about the international operations, how established the margins are they similar to Brazil operations, if there will be the need of expanding cash flow and working capital, as we have seen that there will be a growth. I understand that this question about growth already considers the review of BRL 1.2 billion. I am going to move to Silvio. If Gustavo wants to make any comment about the working capital, feel free.
Okay. I am going to try to cover all of the question. First, about the margin. The growth margins in the Miami market are very different from the growth margins of the Brazilian market. The conditions are quite different. The American market, the payment conditions, they are different. You do not have freight risks, shipping risks. The sales are made in Miami. All of that makes the distributors, which are three right now, they work with very aggressive margins with no installments. I do not see any changes in terms of the Miami margin. Today, we are 2.3%, 2.5%, and it should remain so. We have a new guidance of BRL 1.2 billion. In the first trimester, we had BRL 300 million.
What we consider for this new guidance is that we are going to maintain the level of sales that we had in the first quarter with Apple throughout the year. Here, there are some points. There is seasonality in that, and the first quarter and the last quarter of Apple are stronger than the second or third. As we are bringing in other projects, we are going to offset the seasonality in Q2 and Q3. That is levels of sale 1.1- 1.2. That is much higher, and we are going to mature that operation. Gustavo, you want to talk about the working capital?
I think you have covered that very well. What I could add is that in international distribution, I don't see anything in the short term that would be too different from what we are saying in terms of the suppliers supplying the stocks directly in very short deadlines, so six days, seven days. One point that we have been careful with is that as operations grow, we must always have available credit to be able to establish commercial relationships with our partners. That is a point that we are constantly monitoring, is the only point that today we have to guarantee that we need to guarantee growth for. On Brazil, same line as Silvio. We have been using the strategy to balance our working capital. In the purchasing of products, we negotiate products that have an outflow capacity that is lower than others. We negotiate different terms with our suppliers.
In the same way, when we sell to them, we more and more have been valuing the profitability, shorter deadlines of payment. That is a dynamic that international distribution has been stressing in our everyday operations here in Brazil.
Next question. Yes. I am going to send to Silvio. They are asking you to talk about the partnership with Microsoft.
For two years, we have had the iPhone Forever program. Remind you, it is association between Apple, Allied, and Itaú. Account holders of Itaú, through the Itaú app, they can register in that program, and they can purchase an iPhone in 21 small installments, about 3% of the value of the product. And a 21st installment of 20% of the value of the product.
They have the option of not paying for that last installment, return the used iPhone, we give them a new one, and they once again start paying the 21 installments, and we refurbish that returned phone and sell them through Trocafy. This channel has become one of the main iPhone sales channels in Brazil. It is a channel that Itaú has a lot of passion for. It provides a lot of fidelity. We have expanded iPhone Forever, and we have AirPods in the program as well. We are negotiating with Itaú the possibility of having other Apple items there. What we did was create a similar program within Itaú as well that we call Xbox All Access. Xbox is the Microsoft gaming console. We associate it to an All Access package, which is basically a gaming Netflix of all the games that Microsoft has.
You purchase that package in Itaú, you pay it in 21 installments, and you have a gaming console, the Xbox, and all of the available games already with the console. After 21 months, the console is yours, and if you wish to keep the games, then you have to start paying for the Microsoft service. This program has only started a few months ago. We believe that we will have the same level of success as we had with iPhone pra Sempre. Xbox is also a desired product in Brazil, and it's a relatively high priced product. The installments, they lower the barrier of entry for consumers. These are consumers that Itaú has already pre-selected as consumers that have credit to purchase the item. Another successful partnership with Itaú.
One last question from Barbara.
You can ask that to Gustavo about the investment costs in the company in the consolidated.
Let me just make an overview. We've spent BRL 6 million in the first quarter in investment, so CapEx. The nature of our investment expenses is more or less 80% technology investment and 20% in general improvements and upgrading. We had these done to expand our Allied Miami operations. We have rented space in a logistic center, and we adapt that space to have the level of security that we need, of operational. Part of the investment is in that. Part of that comes from us having to maintain but also remodeling our B&M retail stores. We have a scale of transforming the outlook of the stores that we have, of updating their appearance, and parts of our investment are in that.
These two modalities is more or less 20% of our expenses. The other 80% is in technology. Just to give you some details of two types of that. One part is an investment that end users see. I'll give you three examples. If you log into Trocafy, you're going to see the different possibilities in Trocafy, how we price the products, how we classify the phones, different payment modalities, all the features of the website is a technology expense. Our Soudi app, when they go to a B&M store and they accept our funding, our credit, they also have an app through which we contact the client. We exchange messages with them, either about charging or providing sales. We saw that this would mature throughout the year. We have a platform for corporate sales, Allied Empresas.
The clients will be able to have a purchasing experience, budgeting, and relationship experience in B2B that's much more fluid than it is today. We also have to incur expenses for that. That's the part of the CapEx. The other part is in-house. Some examples there. We have automation initiatives for stock management, for spare parts management, tax automation, the management of the contacts that we get from our 37 online stores, develop systems that make that customer service more automated and simple, more optimized in general. In 37 stores, we get 37 balances to know if everything's according to what we expect. Part of the CapEx is to be able to have a back office that's scalable and able to deal with the thousands of transactions that we conduct every month in a precise manner and in a more and more automated manner. Fabiana, back to you.
Thank you, Gustavo. Okay, we were able to address all of the questions that were made through the platform chat. Thank you so much for your presence. We are available to you. Our contact is ri@alliedbrasil.com.br. Thank you. Have a good day, everybody.