Good day, thank you for standing by. Welcome to the Twilio Q1 2021 Earnings Conference Call. At this time, all participants are in listen-only mode. After the speakers' presentation, there will be a question- and-a nswer session. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to Andrew Zilli, Vice President of Investor Relations and Treasury. Sir, please go ahead.
Thanks, Lee. Good afternoon, everyone. Thank you for joining us for Twilio's Q1 2021 earnings conference call. In an effort to make our call more efficient, we are using a new approach today by posting our prepared remarks on our IR website and using today's call for Q&A only. In addition to our prepared remarks, our earnings press release, SEC filings, and a replay of today's call can be found on our IR website at investors.twilio.com. Joining me today for Q&A are Jeff Lawson, Co-Founder and CEO, George Hu, COO, and Khozema Shipchandler, CFO. As a reminder, some of our commentary today may be in non-GAAP terms. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings press release. Some of our discussions and responses may contain forward-looking statements which are subject to risks, uncertainties, and assumptions.
In particular, our expected business benefits and financial impacts from the Segment and ValueFirst acquisitions and the Syniverse partnership, including the associated transactions, our expectations around the impact of the COVID-19 pandemic on our business, results of operations and financial condition, and that of our customers and partners is subject to change. Our ability to manage changes in network service provider fees that we pay in connection with the delivery of communications on our platform, and the impact of those fees on our gross margin are subject to change. Should any of these risks materialize, or should our assumptions prove to be incorrect, actual financial results could differ materially from our projections or those implied by these forward-looking statements.
A description of these risks, uncertainties, and assumptions and other factors that could affect our financial results are included in our SEC filings, including our most recent report on Form 10-K and subsequent reports on Form 10-Q. Our remarks during today's discussion should be considered to incorporate this information by reference. Forward-looking statements represent our beliefs and assumptions only as of the date such statements are made. We undertake no obligation to update any forward-looking statements made during this call to reflect events or circumstances after today or to reflect new information or the occurrence of unanticipated events, except as required by law. With that, I'll hand it over to Jeff for a brief statement, and then we'll open the call for Q&A.
Thank you, Zilli. Before going into Q&A, I wanted to acknowledge that over the past year fighting COVID-19, each country and region has had good times and bad times. While many places are trending well and we feel like we hope we can see the light at the end of the tunnel, the response to COVID-19 is of course not over, and the tragedy of this pandemic remains an evolving situation and uneven on a global level. I wanted to take a moment to share my heartfelt sorrow and support for our colleagues, friends, and families in India who we know are fighting a tremendous outbreak, along with our colleagues, friends, and family in Brazil, Colombia, Mexico. It's a reminder that this pandemic is not over and will not be over until every country, every city, every community in the world is through it.
We are truly in this pandemic together as a global community. Twilio has created several programs to help communities in the hardest hit regions, providing additional matching funds to organizations such as AID India COVID-19 Relief Program, Give2Asia, and Direct Relief. It is more important than ever to help every country combat this pandemic, and we hope that these efforts will help provide funds towards that cause, and I invite everybody listening today to pitch in your support as you can. Thank you. Now, let's open the call for questions.
If you would like to ask a question, please press star one on your telephone keypad. Again, to ask a question, simply press star one on your telephone keypad. Your first question comes from the line of Meta Marshall from Morgan Stanley. Your line is now open.
Great. Thanks for the question and congrats on the quarter. Maybe a higher-level question. I wanted to get a sense of what your customer conversations are like. I imagine a year ago it was, "Help me get through the next two weeks," to maybe six months ago, it was, "Help me get through COVID-19," to now people are really starting to embrace digital transformation and think longer term. Is that something that we just hypothesized or you're actually seeing in customer conversations, and how does Segment change that conversation? Thanks.
This is George. Why don't I start? We absolutely are continuing to see the conversations around digital transformation, digital acceleration. What I've talked to a lot of customers about is now that they see kind of the end of the pandemic in sight, they're not foreseeing that digital is going away for them, that they see a lot of the transitions that have happened to digital, whether it's telemedicine or digital relationships in financial services, are going to continue. They're looking for us to be strategic partners to help them move to the new world, with technologies like Twilio Conversations and Twilio Flex and other things that we've been working on. In terms of Segment, the people are very excited about it. I've had it come up in probably more than 2/3 of the calls I've been on with customers in the last 90 days.
We've talked about Segment and the opportunity there. I think people are very excited about the idea of delivering much more personalized engagement, and the idea of Segment as a foundational component of that is very interesting to a lot of customers. We're excited about that and the opportunity for us going forward on that front as well.
Great. Thanks.
Thank you. Your next question comes from the line of Samad Samana from Jefferies. Your line is now open.
Hi. Great. Thanks for taking my questions and congrats on the strong quarter. Maybe the first on the enterprise sales hiring side. I saw in the prepared remarks that the company's caught up, but maybe how should we think about the hiring from here and how the productivity ramp looks for those enterprise sales rep hires?
Yeah, we're absolutely on track with our sales hiring. We continue to invest in capacity to match the, frankly, the incredible opportunity that we see in front of us. In terms of the productivity, that has continued to be strong and the ramp times are consistent. We haven't really seen a significant shift as we've added capacity, which is, I think, just really speaks to the demand out there and the size of the opportunity.
Great. Maybe just a follow-up on the decision to split the R&D organization that was discussed then, and how we should think about that impacting the innovation cycle going forward.
Yeah. Thanks for the questions, Samad. This is Jeff. I'll take that one. We've got a very broad set of products and a very broad customer base all around the world, we thought the way to best serve the broad set of customers and the broad set of products was to break it out into three units. We have our Twilio core communications platform, our data platform, and our core platform. We've got great leaders for a lot of these things, and you could see a lot of synergies between all the things we're doing in communications, which is the core business, a lot of things we're doing with data, and Peter from Segment, who's going to lead the data team.
A core platform is sort of how we build internally and all the platforms that support the growth of all of our engineering units. By dividing and conquering, we think we can actually tackle more, to continue our track record of innovation, and continue to serve our customers at scale. I'm really appreciative of Chee and everything he's brought to the company and looking forward to building the next great set of products with the great set of leaders we have and ones we're going to hire.
Great. Just as an aside, we love the new reporting structure. It allows us to spend more quality time with the management team, rather than listen to you guys read the script to us. Really appreciate that and appreciate the additional time with you all.
Fantastic.
Thank you. Your next question comes from the line of Fred Havemeyer from Macquarie. Your line is now open.
Hey, thank you very much for the time here. I'm interested in some of the acquisitions and investments that you've recently been making, including Syniverse and ValueFirst. Can you help us understand how these acquisitions, investments, and partnerships could help your overall cost structure, both domestically and internationally? Secondly, on this topic, can you tell us about how these investments could benefit your customers across areas such as pricing and also reliability of services?
Those are good questions. This is Khozema. I'll start. I think from a cost structure perspective, obviously having local presence in markets and being able to do some consolidation within our supply chain is always going to yield some cost synergies. We definitely have an eye on that in terms of some of the ways that we're looking at it. I think beyond that, if you look at some of the more recent things, like whether it's in Mexico or whether it's in India, that also gives us enhanced geographic footprint. It allows us to better see consumer demand in some of those markets as well. From a pricing perspective, I wouldn't say there's a big change in pricing relative to M&A.
It obviously remains a competitive pricing landscape, but I think we feel good about the way that we're positioned, and I think this allows us to continue to geographically expand.
Thank you.
Thank you. Your next question comes from the line of Brent Bracelin from Piper Sandler. Your line is now open.
Thank you. I'll echo comments of appreciation here on the new format. Super efficient and super helpful. Maybe Jeff, I'll start with you. We're six months now into the Twilio Segment combination here. My question for you, what are you most excited about and most pleased with during the first six months of the integration here? I know it's early, but we're seeing some interesting personalized messages come out, some interesting Flex Segment integrations. Secondly, what are you most excited about now that you know what you own here, looking out over the next couple of years?
Yeah. Thank you for the question. Well, first of all, the nuts and bolts of integration are hard, but they're going really well. I've been really pleased by just the great culture overlap, teams working really well together, and teams that see the opportunity and see the way we approach customers and the markets that we're serving, see those things really well aligned. Super happy with Peter, the leadership team at Segment, and all of the folks who joined Twilio with that acquisition. Talking about the opportunity ahead, look, I think we are seeing this come up in so many conversations with customers that maybe in the past before we had Segment as part of our portfolio wouldn't have organically come up.
Now that Segment is here, really seeing that become a major part of the conversations we're having with customers. Because every company that I talk to seems to be struggling with, how do I build this one picture of my customer based on data that is spread across all these different, not just systems they have, and they have that problem. They've got a separate system for marketing and a separate system for their contact center and a separate system for commerce, but also across business units. Like, oh, we made an acquisition here. We got to integrate their view of the customer. Oh, we've got these different structures inside the company, and they all use different systems. This question of how do you actually build that profile of your customer? How do you understand your customer?
The story that is being told by all the data that customers are giving off by how they use your website, how they use your mobile app, what things they've bought, what things they've returned, et cetera. That story is resonating with customers because they all see that problem. Not just how do you make sense of that data, how do you act on it? That's where Twilio comes in. How do you actually build really engaging communications, whether it's marketing during your sales process, during your support or in product, how do you tailor and make all that stuff dynamically personalized to every single customer to optimize their chances of becoming a repeat buyer, becoming a loyal customer of yours? That's something we see so many companies wanting to do and struggling to do and looking to us to help them to do.
When I look forward to what we're going to build with Segment, I see a tremendous surface area across pretty much every industry to help them solve this problem.
Interesting. Big problem, certainly a big opportunity. Khozema, one quick one for you. AT&T and T-Mobile joined the price increase party that I think Verizon kicked off last year. How should we think about the framework around what type of growth rate that could have an influence here on Q2? It looked like the guide did not include any sort of impact on that price increase. You have two carriers instead of one raising price. Just trying to think through how should we think about that impact in Q2, or should we just wait a quarter and wait until we see actually what happens. Just curious to hear your thoughts and guidance here on that price increase.
Yeah, we left it out of the guide on purpose just so that it wouldn't be that confusing, and we wouldn't have to deal with all the kind of puts and takes. You should look at the guide as being clean, and excluding those impacts. I would say you should largely expect them to be in the ballpark as what we saw previously with Verizon. We'll provide a lot more detail on that when we do the Q2 call, and we'll give you the exact numbers at that time.
Got it. Makes sense. Thank you.
Yep.
Thank you. Your next question comes from the line of Alex Zukin from Wolfe.
Yeah. Two-second question. I'm going to instead of asking my typical dollar-based net expansion question, to Khozema, I'll do just two very big picture product questions. Jeff, maybe this is for you first. If we take a step back and we zoom out and we look at the components of your business, you're now getting into a point where you're able to do potentially intelligent messaging solutions where you can effectively have a customer send a message when a certain action takes place, like a cart is left abandoned. The value-added component of that message for that customer is a lot higher than potentially some others. I guess the question is, are you able to now start thinking about different pricing or different unit economics depending on the type of message that you're helping a customer deliver?
Thanks, Alex. I think there's two ways of thinking about that. One is our role as a platform. As a platform, you support many different use cases. Even within things like messaging, there's different use cases for messaging. In fact, different messengers may have different performance characteristics. Some customers might value speed of delivery over others might value things like bulk delivery. There's ways of thinking about how do you segment in the product itself, at the platform layer. There's ways of saying like, okay, but in order to actually do a specific use case, you often have software that's powering that use case or integrations. To use the example, you have integration into a shopping cart. The business logic of that integration and the business logic of that intelligence is in many ways a different value proposition from the platform itself.
As you see what we're doing with, for example, Flex, that's what we're building, is we're building the value proposition of a contact center on top of the primitives. You see that with our Marketing Campaigns products as well. I think when you think about our core communications platform, you get the sense of the economics are tied to the underlying capabilities of the platform. When you look at the engagement platform that sits above it, the economics are more closely tied to the value proposition that we're creating with the software. I also think that part of Twilio's unique value proposition is to build a product and a go-to-market that very closely aligns how our customers use our product with what they pay.
I think that's a key competitive differentiation, which is a little different than traditional solution selling, which is you're trying to extract full value. I think as a platform play, you still leave white space for customers to go paint in to make it theirs, and that's what they value. They want to build on top of our platform. As a result of that, we give them that flexibility, and that enables them to get outcomes that they can't get with any other vendor. That also enables developers to continue to be our biggest champions inside of these accounts. I think those are important things for us to continue to consider.
Another big picture question. If we think about the rise of IDFA, the potential demise of third-party cookies. It's our thesis that we're entering a world where the notion of the CDP for first-party data is going to rapidly accelerate in strategic performance. You guys mentioned, I think, George, you mentioned that Segment is now in 2/3 or was in 2/3 of your customer conversations. I guess a couple of angles around this question. Is this future world something you contemplated when making that acquisition? Are you just now reaping an even greater amount of strategic benefit? Just talk to us about how you think about Segment in this new world, both integrated with the rest of your solutions as part of the platform, but also on a standalone basis with respect to strategic enterprise and all these things.
This is Jeff. I'll answer. Unless, George, you want to?
Go ahead, Jeff. I'll chime in.
All right. Well, I'll give my point of view, and I'll let George give his point of view. Collaboration, who's going to answer, is harder in this virtual world. My point of view is, yes, we did think about the importance of first-party data and how every company is having to become great digital marketers and great digital executors. You can't necessarily rely on some of the, let's say, sloppier ways of acquiring and re-engaging your customers, when you've got a lot of third-party data floating around out there. We do believe that the CDP market, in and of itself as a standalone, becomes ever more important to companies, not just because of the plurality of systems they have to figure out how to make sense of, but also because outside their walls, it's getting more complex to actually target and reach your own customers.
It becomes even more important that once you meet a customer, whether it's in your marketing or they buy something or whatever it is, that you do a really good job of continually engaging them. Going back out to try to reacquire that customer is getting harder and harder. Companies have to treat their existing customers incredibly well, and those relationships are getting even more valuable. Then you add in all the value of integrating that and creating that journey that is going to achieve that using Twilio's customer engagement cloud. That is the next level of benefit on top of the core CDP.
Yeah, I think Jeff said it really well. I would say we're having certainly a lot of these conversations that I'm talking about are largely customers. A lot of customers are learning about our acquisition, interested in our strategy, and we're having the broad conversation. We're definitely seeing interest on both fronts of both the standalone CDP conversation as well as the potential for intelligent engagement that's built when you have the customer data and all the engagement channels together. I think there's potential both standalone and integrated, and I think that's one of the things that we're excited to continue to build on going forward.
Congrats. Just amazing execution as always.
Thank you.
Thank you. Your next question comes from the line of Derrick Wood from Cowen. Your line is now open.
Hi. Thanks for taking my questions. Congrats on a great quarter. We get a lot of questions from investors on how to think about consumption growth trends across various use cases as the economy opens up. Jeff, it'd be great to hear what you're seeing from the COVID-19 impact of use cases in travel, hospitality, ride sharing, get a sense of, with the opening of the economy, how that impacts some of the use cases that got catalyzed from COVID-19. Really just trying to get an understanding of how those net out as we navigate through the opening of the economy, maybe put that in context with how you guys guided for Q2, which assumes flat to up $10 million in sequential revenue.
Absolutely, Derrick. I'll answer that. What I would say is, you've got this usage pattern, you've got two categories, roll the clock back to a year ago. You have a category of digitization of lots of interactions. That was really the path that society was on and every industry was on because of digital transformation, like the big secular trend, and those got accelerated. A lot of the things that we're seeing, like a lot of the workflows between ordering online and picking up in a store and things like that, are getting far more use now than they would have before or t elemedicine. Saw a huge acceleration of adoption of telemedicine. Those workflows have provided consumers, in a lot of cases, a much more convenient path.
These are things that these organizations, whether it was healthcare doing telemedicine or retailers doing really good online order pickup type workflows, these are things that were on their path anyway, just got accelerated. I think we're seeing is a retraining of consumers to expect new types of experiences. Those are going to continue, and the competitive dynamics of keeping those features and making them better and making them ever easier, I think those are going to continue. You've got the category of industries that were negatively impacted by COVID-19, so think travel, hospitality, things like that.
Those obviously saw a decline in their usage in 2020, and now I think we're starting to see the early signs of the recovery of many of those industries, which I already read the headlines, talking about people returning to travel as they're getting vaccinated, and how hard it is to get a rental car, and how airplanes are now full.
As we see the return of those industries, I think that we will continue to see both return of volume and usage, but also of new use cases, because many of those industries have to now go build trust with their consumers and say, "Hey, it's safe to do these things again." "Hey, trust us as the brand you're going to return to as you start doing things like traveling or eating out or whatever it is." We're seeing not just the return of the old use cases, but I think also new engagement strategies that these companies have in order to build trust and loyalty in their customer bases, that in many ways they have to re-engage with and reacquire.
I guess maybe I'd throw it to Khozema on the revenue guidance. I've gotten some questions on, just if you look at the sequentials, it's flat to slightly up. Historically, you've seen some good sequential seasonality in Q2. I know you may have conservatism in there, but any other puts and takes to call out for Q2?
Yeah. Let me just add to what Jeff said, then I'll directly take your question. I would say, in general, what our guidance contemplates is sort of a world without COVID in a way. Notwithstanding what Jeff said at the outset of the call, obviously there's a lot going on globally, and I certainly don't want to take anything away from that and the impact that's having on people. Generally speaking, the way that we're looking at things is as if COVID is starting to wane and we see durability in some of the positively impacted industries. We see recovery in some of the negatively impacted industries. In general, I think as we start to think about a world post-COVID, we just see a lot of general strength in the business, very kind of broadly diversified across industries and geos and company shapes and sizes.
As it relates to Q2 specifically, we feel good about the guide. We're still up in the quarter based on the guide, 47%-50%. The world is a very complicated place right now. There's a lot of moving pieces. I think we'll wait and see how things exactly play out. We feel good about the way that we guided, the way that things are positioned, and we feel great about the long-term prospects of the business and certainly in the short and medium term.
Right. Yeah, 50% growth, pretty amazing. Congrats again. Thanks, guys.
Thanks, Derrick.
Thank you. Moving on, your next question comes from Ryan MacWilliams. Your line is now open.
Thank you. I certainly have a question, and I'll take Zukin's normal dollar-based and expansion questions. Knowing that this metric can fluctuate, especially with the SendGrid compare year-over-year, but anything to comment on here with this moving lower in the quarter and maybe any read-through to the following quarters for that? Thanks.
Yeah, you certainly hit one of the nails on the head. I would say in general, like at 133%, DBNE is still really strong. Whether you look at it on a year-over-year basis or you look at it on a sequential basis, maybe I'll start with the latter. The sequential basis, you obviously don't have the political dynamic, right? We're in a non-election year, that's going to drift it down a little bit. We've also lapped Verizon carrier fees, one year away from that's going to have a little bit of an impact as well. Really the third dynamic is what you said a moment ago in terms of SendGrid. I would say on kind of a normalized basis, you might think about 130s, but we feel great about the printed number, 133%, and we're really happy with the way that our expansion rate's been going.
Thanks. Just from my perspective, great to see how Twilio helped support global vaccine distribution. From a financial perspective, I've just been wondering, did vaccine distribution delivery materially impact results at all in the quarter?
I wouldn't say it impacted our financials materially. As I said a moment ago, I think we're really looking at the world both in terms of our Q1 print as well as the way that we guided into Q2 based on a world in which COVID is sort of a thing that's starting to wane a little bit, and we just see broad-based things across the business, and any one use case is relatively de minimis.
Understood. Okay.
Thanks.
Thank you. We have a follow-up question. Your next question comes from Michael Turrin from Wells Fargo Securities. Your line is now open.
Hey there. Thanks, everyone. Appreciate you taking the questions. George, the Deloitte hackathon you mentioned in the materials stood out as interesting. I'm wondering if you could talk more about what events like that could maybe open up and how that can help with the push into targeted verticals. Specifically, healthcare seems interesting there, but anything you can add around context is helpful.
Yeah, thanks for the question. We've had a hackathon program now that we've used successfully in the enterprise area directly with customers. Now we're starting to do that with our partners. Obviously, when you're building momentum with a large systems integrator, a lot of what you need to do is, first of all, get people internally just aware that these are not simple entities or complex entities. They have lots of groups. Just kind of evangelizing internally the power of Twilio and the Twilio message is really important. Bringing these hackathons we find is, generally speaking, a really good way to extend our reach, especially among the developers and the thought leaders within an organization, whether it's a customer or an SI like Deloitte. We're excited about that.
Also, a lot of the time, these hackathons also yield really interesting IP or the beginnings of interesting IP, and whether that's at the customer side or on a partner side. With an entity like Deloitte, the opportunity to create vertical IP, I think is very interesting, especially around Flex, which is a big focal point for a lot of our SI discussions. Remains to be seen, obviously, how all these things play out. There's usually a pretty significant path between a hackathon and obviously real IP. We're excited about the opportunity, whether it's with Deloitte or with others, to go down this path, repeat that, continue to evangelize, get the flywheel going, and continue to do more work with them. We're really excited about the potential of this partnership.
We're seeing some traction already, and this is just another brick on the path to building a really successful long-term enterprise playbook.
Yeah. Makes a lot of sense. Just quick for Khozema, can we go back to ValueFirst for just a moment? I'd just be curious if there's more you can add on what that adds internationally. I know that's been one of the few focus areas. Anything you can add on any contribution. I don't know what the timing specifically looked like, but any contribution you saw or would expect to see is helpful.
Just to take the latter part of the question first, very de minimis contribution in the current quarter, and it'll be relatively de minimis contribution going forward as well. We're not necessarily calling it out. I would say ValueFirst kind of fits into one of the questions that was asked earlier in terms of just broader trends that we're seeing in supply chain. When we see a unique asset that we think on the one hand gives us a particularly interesting entry into a geo, and it's not limited to India, obviously, although India's obviously a huge consumer market. I'd throw Mexico into the same category, which is why we did a deal there too. India, Mexico, large consumer markets, opportunity, for some, cross capabilities. With these acquisitions, we always get awesome local teams.
It's really just a combination of those things. From a financial perspective, I think this is like an add to the portfolio, but nothing that you should really think about in terms of having an outsized impact on our financials at all.
Okay. Helpful. Keep up the pace. Thanks, everyone.
Thanks.
Thank you. Your next question is from Mark Murphy from J.P. Morgan. Your line is open.
Oh, hey. This is Pinjalim on behalf of Mark. Congrats on the quarter, guys. Jeff, a high-level question again for you. From a product strategy point of view, how do you think about kind of accelerating the usage of Twilio core communications by developers? Just the usage of that. Do you think like serverless or Functions is an important strategy to drive speed to market for developers? Or maybe the Studio's a way to go to democratize the usage beyond developers? Or now that you have Segment, maybe you can actually tap into a broader low-code/no-code customer engagement solution. Would love to hear your thoughts around that.
Absolutely. First of all, I'd say we're really pleased with the adoption of Twilio and all of our products by developers, and think that's going very well. Developers continue to pull us into the wide variety of opportunities at every kind of company that you see us posting up as those new customers. As far as smoothing out, I don't necessarily draw a straight line between low-code/no-code and getting more developers and more accounts in the platform. I think low-code/no-code are tools, and when the problem you have fits well into [inaudible]
Hey, guys. This is George. Seems like there might be a problem with Jeff's line. Obviously I can't completely anticipate his train of thought there, but certainly.
[crosstalk] Can you hear me now?
Oh, you're back. Perfect. Thanks.
Yeah. Zoe says my phone connected to my car, that is exactly what happened because someone just stopped to go pick up my kids and turned on the car. Fantastic. Good to know that that's a way earnings calls can fail. Back to what I was saying. I don't know where I lost you, essentially, low-code/no-code is a tool that if that tool allows you to build your use case faster, more reliably because it's hosted for you and you have to provision your own infrastructure, developers love to use it, as do what's often called citizen developers. It's the right tool for the right job, we've seen a lot of uptake of Studio for certain types of workflows and other things that are more client side and more deeply embedded.
May not be the right tool, but we are definitely committed to this roadmap of using low-code/no-code and what I call yellow code, each for the right thing, that enables the developers and the various participants of the company to do the tasks that they need to do. By the way, that includes taking things like Flex, which really accelerate our customers' time to deploy these solutions, but then still give them the flexibility to go invoke functions or use Studio to build that IVR or build that chatbot flow and plug it into just the right spot. I would say I think we're using low-code/no-code effectively today, and we've got a massive roadmap for how we can continue to unlock more and more use cases and more and more customers to be using that.
We are very happy with the adoption that the developers are already doing on Twilio across those solutions, including a lot of them who aren't using no-code because they're writing code the old way.
Understood. Thank you.
Great. That will do it for today's call. Really appreciate everybody joining today and look forward to catching up with you throughout the rest of the quarter.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may disconnect.