Adobe Inc. (ADBE) Earnings Call Transcript & Summary

Welcome, everyone. I want to thank you for taking the time to dial in here for the Adobe presentation at Oppenheimer's 23rd Annual Tech Conference. I'm thrilled to have with us here today, Jonathan Vaas, who is heading up the Adobe's IR department. And for any of our listeners who are relatively new to the story here, let's start first at a high level with just a brief introduction of yourself, Jonathan, and maybe your thoughts about the company. If you could share your thoughts, as you've moved here from the legal department to Investor Relations at this point in your career, are there any strengths maybe you under appreciate about the business until you got more under the covers through the Investor Relations role? How has the experience been so far? Any surprises? Just general thoughts about the company through your lens.

Thanks so much, Brian, for inviting me. And just to make sure I'm high energy, I have here my Buckeye Donuts coffee mug to show a little Ohio pride. Brian and I were chatting yesterday. I learned that he is a University of Michigan man. So we can joke about that rivalry. So yes, thanks so much for the introduction. And I'd be happy to say a little bit more about myself. I have had a few calls with investors where they said, I understand you're new to Adobe, and I actually joined Adobe almost 10 years ago in 2011 as the corporate and M&A attorney. So I got to know the business really well over the years, kind of growing the business and working with strategy teams through acquisitions. That -- 2011 was an exciting year to join. We did 8 acquisitions that year, many of them smaller, but you get to know the business really well. And that was also the year, at the end of 2011, that we launched Creative Cloud. So I really joined Adobe right at the end of the company being a box software company that sold perpetually licensed shrink-wrap software and got to see the transformation all the way through today. So it's been a really exciting time. Throughout that time, I worked very closely with Mike Savage as his corporate securities attorney. So we worked -- we partnered together working on disclosures in our annual reports, working on our annual stockholder meeting. And over the years, I got to know Mike really well and learn more about what he did. Also as the Assistant Secretary to our Board of Directors, around 2015, I started talking to stockholders twice a year with Mike about corporate governance and executive compensation and different ESG-related topics. And I learned through those conversations, first of all, when you're on the phone with an investor, they'll ask about whatever is top of mind for them. And I learned through those that I really enjoyed telling the Adobe story. And as Mike transitioned and got closer to retirement, he really worked closely with me to kind of teach me the ins and outs of how he tells the Adobe story. And we did -- we kind of co-led the Investor Relations function from before his retirement in June, which was so helpful for me and just learning from the master who was in that role for 20-plus years. So that's a little bit more about me. But actually, if we go back even further, long before I attended law school, as a teenager, I was an aspiring artist. My freshman year in college, I actually attended an art school, and this was in the mid-1990s, and there were 9 courses on the freshman curriculum. And one of those was just learning Adobe Photoshop and Adobe Illustrator. And ever since then -- I failed as an artist and ended up going to law school because that's what you do. But I remained a lifelong fan of Adobe and its products. And I actually -- the first time I had the opportunity to attend a meeting, sitting across from John Warnock and Chuck Geschke, our founders and members of the Board, I told him that same story about how I have been a lifelong user of the product. I think when I came to Adobe, I was looking for a company that kind of checks 2 boxes. That was the what: what does the company stand for and what does it do for the world. And empowering creativity and kind of democratizing the ability for people to tell their story was something that I just felt really passionate about given my history. But what makes my job even easier is it's the how. Adobe, when you're a corporate attorney for a company for almost a decade, it makes your job so easy when it's such an ethical company that kind of does things the right way. Adobe's consistently recognized for this. In my Investor Relations role and throughout all of the ESG conversations I had over the years with investors, it's the how that kind of makes the job easy. And it's certainly, right now, when we're seeing even a further wave of accelerated digitization of the world, it's an exciting time to be in the road. Although an unusual time, being stuck from home, I expected to be in New York and Boston and London throughout the year. And here we are. Here I am in the home office.

So that was a terrific introduction of yourself. Thank you very much, Jonathan. And I can tell you, I think this is the year, 2020, Ohio State's not going to beat Michigan in college football. I feel really good. We're going to be at the streets this year.

You might be right about that. Yes, sadly.

All right. Let's switch over to -- let's dive into a little bit about the opportunity here, the next couple of questions, but sorry to hit you with a TAM question to start off, first, on the growth runway. But Adobe is one of the most iconic companies in the software industry. It's well admired, and the story's well-known here. So let's talk first about the runway, how long this strong growth can continue for the business here. We always get this question from investors whether there's enough TAM just for multiple mega platform companies in the customer market. They won't say it. I'll say it. They're thinking about Adobe, Salesforce and Microsoft. So maybe you can shed a little light about kind of the TAM and where the penetration rate is today for the business.

Yes. That's one -- it's been a changing story over the years. When I joined Adobe, we kind of thought of the TAM. If you look at -- if you break down the 3 businesses, Adobe Acrobat, around 10 years ago, was kind of growing in the mid-single digits, and it was sort of viewed as that's more of the cash cow. There was concern among the market that sort of the creative products that saturated the professional user base. And then there was this explosive new opportunity in digital marketing software. As we stand here today, you look at the last decade, and you realize we probably proved a lot of people wrong, perhaps even ourselves. When you look at -- today, all 3 of those businesses are high-scale growth businesses and growing revenue profitably as well. And so in preparing for this, I looked back at the TAM information that we shared, in fact, last November. Now this was pre-COVID, pre what we're calling sort of an acceleration globally of an increasingly digital world. And what you'll often hear us say when we talk about TAM is we are not opportunity-constrained. When you look at the sort of mandates in the world for businesses to digitally transform, when you look at the velocity of content and then you look at how many large organizations, geographies, governments are still overwhelmingly based on paper-based process, how much runway there is. And you saw that with our Q2 results. People for years have been asking kind of the same question, how are you bringing new users to the platform? Ultimately, it's because there are so many new content creators that are consistently every year entering the workforce, entering the hobbyist and communicator ranks. And at Adobe, we view content -- we view digital content as powering the global economy. As the economy moves and churns on, it's kind of -- it's hard to go a day in the life without interacting with a piece of content that was created with Adobe or delivered with Adobe. We don't see that slowing down. We see kind of the losers in the market as being traditional means, nondigital means, the network printer. We often talk about digital, we see all kinds of runway. So we see no constraint in opportunity. We get asked about competitors sometimes. And what we often say is, in these categories that we compete, they're so explosive. There's going to be a few winners in each of these categories. Just like in the '90s and early 2000s with the ascendance of ERP software at a massive rate, there are a couple of big winners in SAP and Oracle. We think in the areas where we compete, these are certainly large-enough categories for a few winners. The other companies you mentioned are certainly also seeing tailwinds in the digital transformation we're seeing globally.

Sounds good. Well, if we dive in a little deeper in terms of the growth drivers and kind of the vectors, I mean is there still greenfield opportunities even left for the business? How much of the growth comes from replacement activities, displacing an incumbent in there? How much of the opportunity is left of just expanding within your own installed base, expanding, getting broader product or customer penetration? Maybe you could talk a little bit about what areas of the business are they going to boost here from the working-from-home trend. And then lastly, with international, if there's still growth opportunities there.

Yes. Yes. There's a lot to that question. And our business is so diversified, I'll highlight some different pieces as I work through those. In terms of greenfield opportunities, I would say, if you look at all of the pillars of our business right now, we feel like we have -- we feel like we are competing in the right categories. And again, there's no constraint to the growth we're driving organically. One that kind of comes to mind on the creative side of the business is experience design. When you look at how we've -- there's been a rethinking over the past decade around what used to be you bring in a bunch of engineers, have them build technology and at the end of the product, bring in a designer to put lipstick on the pig. Now we architect and we build things based on design-led thinking where the designers -- in the project in terms of how the entire experience will flow. He said -- Scott Belsky, our Head of Creative Product, has said that he thinks that experience design as a category could be as big in a decade as Photoshop is. So that's one with Adobe XD, we're really excited about the opportunity to grow there. And then just the communicator space in general, so when you're addressing communicators, these are people who have professional use cases, but you wouldn't think of them as a classic creative professional. You have to give them a different set of tools, simple to get up and running and make it difficult to do too much and screw something up. So you want to just give them the right amount of tools to simply produce something that looks professional quality. And we addressed that segment through tools like Adobe Spark or Premier Rush. And there's just -- if you look at the data that we gave in our last TAM, a huge number of people globally in that segment. And if you can win there, I would say that's a big greenfield opportunity for us. For your question about displacing existing solutions, it more reminded me of the other side of our business with what we're doing with enterprises. And I think people would often be surprised by how much of the growth you drive in enterprise, not really by stripping and replacing a competitor, how much you go head-to-head with a big competitor versus landing an account with an enterprise on something like web analytics or web content management. And when you prove out the value, they realize that they simply haven't invested yet in other areas that you can help them with. They haven't ever invested in segmenting their audiences based on data science in a way where they can have targeted campaigns to different constituents, bringing them to the website. They haven't invested in a modern commerce solution. There's a lot of homegrown IT that you displace. So the -- in digital transformation and enterprise, there's -- the category is so explosive that I think more of the growth is driven through a land-and-expand motion where they -- where enterprises simply haven't realized if they invest in these solutions, they can drive so much growth and pay back the investment in a very short period of time. That's probably more of a motion than kind of ripping and replacing competing solutions. Let's see, what else did you ask about? In terms of the work-from-home tailwind, in our Q2 call, we called out some obvious ones. Document Cloud, broadly speaking, and Adobe Sign are big ones. The content and commerce is another area. I think Shantanu did an interview yesterday on Squawk Alley and dropped this statistic, which I heard for the first time. He said we're on track this year globally to exceed online spending of 2019 by October 5 based on current data and current trends, which is well ahead of the holiday shopping season, which just shows you how much of a tailwind and momentum there is towards digital commerce. The other big one is the video apps. We found the YouTube economy just continues to explode, all kinds of people who are an enthusiast of something that you wouldn't call a creative professional. They could be a chess enthusiast or somebody who wants to start a fashion channel or someone who wants to teach videos on how to code in JavaScript. They're learning video editing, and they're getting YouTube channels up. And the video tailwinds have been really strong. So those are just a few areas. But Shantanu, in that same interview I referenced, yesterday mentioned that all 3 of our businesses are seeing real tailwinds in the economy right now, which is it's a rarefied air. I think your last question was about international penetration. It's been pretty consistent over the years. We've been sort of high 50% of our revenue in the Americas and low 40% rest of world. And I think one of the reasons why that's remained that way is when we add to the business through M&A, those acquisitions tend to be a little bit less mature in rest of world. So over time, our digital media franchise has penetrated the rest of world markets more than the enterprise side. And when you bring something in like a Marketo, that probably reduces the percentage of rest of world a little bit, but that represents a lot of opportunity. When we look at the next decade, we imagine a lot of the digital transformation we've already seen in the U.S. and in Europe will spread to a lot of other geographies, which represents growth opportunity.

You got them all. That was really good, flushed that off out there. Maybe I'll bring you more real time here, talk about how the pandemic is either impacting the market demand and the operations over there at Adobe. Maybe we'll start first with the market demand. You talked about digital transformations, and we're really hearing it from the CEOs across my software universe that they're seeing some acceleration in digital transformation initiatives during the pandemic. I was wondering maybe if you could just walk us through just some anonymous large customer renewal or engagement that happened during the pandemic. And we're interested in knowing if there are any common needs or maybe common business insights that seem to be most topical for customers as they're going through a renewal process with Adobe during the pandemic and typically deepening the relationship with the company.

Yes. One thing I do every week, I review sort of the customer win e-mails that go out from our sales ops teams just to look for those kind of themes. And in some ways, I would say it's more of the same, which is you tend -- so you tend not to land a brand-new logo and sell them an entire suite of product. There's -- this is not plug-and-play software. There's -- we often go to market with partners who help implement with their services. And I would say the most common way that we kind of see a renewal cycle play out is we prove out the value on something like the Analytics product, which is, of all of the offerings we got, that's the legacy product from Omniture; or web content management. And once they see the value and they realize how much of an uplift in their conversion rates they've had or how short the payback period was before they started seeing return on that investment, you have a lot of credibility then to go back to the table with them and explain how, if they invest in certain other solutions, how much more they can accelerate the business -- transforming digitally. And again, a time where traditional means of revenue-generating opportunities are challenged, there's even more interest. In our Q2, we talked about and even going into it, sales cycle slowing down a little bit. It was the heart of the pandemic, and we mentioned the momentum picked up later in the quarter. And I think now we're existing in a world where we kind of adjusted. We've all gotten used to figuring out how to keep being productive, how to deliver product, how to get customers up and running. And when I look at those sales wins, it's often a matter of a customer that was on one solution. We proved out how if they acquire 3 of the solutions or 4 of the solutions, for example, if we're already doing analytics and content on their website, if they invest in Audience Manager and Adobe Campaign, then to use modern database technology to reach out to different segments of customers and give them the right offer at the right time, and when those customers come to the website, in milliseconds, we can show them an experience custom-tailored for them and deliver that all the way through the commerce engine and the shopping cart, how much more they can do together. And so many of the wins look like that sort of a story where at the renewal point, they might have come on through a contract that was $0.5 million of ARR. Then we can upsell them 3 solutions, and suddenly, there are $3 million or $4 million of ARR. You see competitive wins certainly in those logo sales, but a lot of the growth is really driven from current customers who are buying more once they see how much more value they can get out of what we're delivering.

Very insightful. How about on the operations front here? Clearly, most of your workers are working from home right now. So how is the pandemic just changing the processes, the collaboration, innovation, the implementation cycles and the sales motion at Adobe with everyone working from home?

It's been amazing to see how quickly we've all kind of adjusted to this new normal. These -- our days that are like this: we're staring at videos on the computer screen. And in March, when it was all happening rapidly, there was a lot of anxiety about how we would continue selling, how we will continue innovating. And I think by the end of our Q2, we had kind of adjusted. Shantanu mentioned during the earnings call that he talked to CEOs on 3 different continents on a single day. So in some ways, our executives' access is more readily available because most people are at the home office, and we're not traveling so much. It's not a completely rosy picture. I think we do miss the energy you gain from collaborating and working as teams in person. And I don't think Adobe is ready to predict the death of the corporate office just yet. And there's something you miss from in-person conferences that you don't get from being remote. On the upside, you're able to reach more people through a virtual event. Fostering of sales leads and the development of sales pipeline that occurs at an enterprise conference, it's hard to replicate without. And so there are downsides at being all remote. But I think for us, probably the biggest anxiety in a remote world operationally would be technology teams being able to continue to innovate and deliver product. We really kind of checked that box with -- we had a massive release of major updates to all the flagship creative applications in June, which there was a fair amount of press around. We were really pleased by the amount of innovation we were able to deliver in a pandemic with everyone working from home. I think our home broadband access hasn't failed us too often, and it's going to be a fair amount more time that we're working in this way. And I think in terms of the sales cycles, we've kind of -- as we mentioned on the Q2 call, the momentum picked up as we got through that quarter, and we're all just kind of operating in this new normal for however long it lasts.

Yes. I think you're right. I think we're getting used to it. I think people are getting used to it. And I did like your comment about Shantanu, the engagement. These CEOs, every CEO I talk to, they're all extroverts, and they're all like so excited that they're doing like 12 to 16 meetings a day, and they don't have to fly. They may be not so upset about this, these CEOs, because everyone I talked to, they're all excited about how many more people they're able to talk to.

Yes. We've surveyed employees, and they say, by and large, employees estimate that they're more productive in some ways because they're not commuting. And nobody's quite solved how to have boundaries when you're working from home. So we're all working a little bit more. And we don't want our workforce to burn out, and those are things we want to solve, too. But right now, productivity remains high.

Perfect. Jonathan, I wanted to ask you just on the pandemic and thinking about investments, if maybe there are some changes here that are a little bit more permanent here. So when we think about maybe the company's future investments, I'm really talking about commercial real estate, T&E. And you mentioned in the last question about whether the whole virtual events rather than premise-based for conferences and events, so you actually have an example here at Adobe because you had to postpone your annual summit conference in March, and you turned the -- that's for the Digital Experience business. So you turned that into a virtual event, I believe, in June. Your annual MAX conference is going to be a virtual event here in the fall. So I guess 2 questions. One was a question of just, are there discussions maybe rethinking some of the investments that maybe won't be as necessary in the future? And then maybe if you could just share with us how are your thoughts on virtual events here and how the summit event went? And do you think that they could replace these annual conferences in the future?

One thing we talk about a lot is the changing nature of work, and we do believe that post-COVID -- that's got to be one of the words of the year, by the way, post-COVID and pre-COVID. Post-COVID, the world will look different. I think we -- but we've already been headed in that direction. We've been on this trajectory of an increasingly virtual world. And I think companies are now realizing that that works. We also are realizing the value of being together in person, the value of conferences. We don't -- again, we don't think our -- in terms of corporate offices for us that we'll have fewer of them or that won't be important for us, in our culture. But we do think we are asking what will it look like? How will the walls and the number of conference rooms and the way that the local population, when they come in and how they use the office space, how will that change? And we're just sort of in the middle of the asking and the speculating and the learning about that. We're actually building a new tower in Downtown San Jose, and even -- we're in the early stages sort of foundational work there. And we're going back and asking questions about the design and the build-out of that of kind of how -- given the changing nature of work, what will corporate offices look like? In terms of conferences, again, we've learned that virtual events can reach a lot of people. But we've also -- there's some value and some community building that you don't get through a virtual MAX. On an earlier group meeting, I was saying I'm personally mourning that I don't get to be in the Staples Center surrounded by creatives and just feeding up the energy of seeing how they're excited about Adobe innovation. So I think in the future, certainly, the large conferences will make a comeback. And I think there will be a real celebration when we're able to do that. But I think the virtual conferences will be more a part of the mix. I think we've realized that there are real ways that you can reach broader audiences by investing your time in those events. I think we'll see more of that as well. And so again, the world is going digital, but there's real value in human connection as well. So it's going to be some mix of those things.

Jonathan, I want to switch over to the segment, the Digital Media business here, and really about the growth sustainability. So God, I feel like it's been a debate for half a decade now on how long the digital media business can keep up its strong growth. It's been almost 3 decades now in the market. It's the foundation of overall Adobe, and the business consistently outperforms investor expectations on ARR growth year after year. So can you shed a little light here on how you kind of size the digital media opportunity as it stands today? How long of a runway is it ahead? And what's the biggest opportunity within that -- within the business segment, Digital Media?

Yes. Yes. Again, in November, when we sized the TAM, we said there were -- in 2022, it'd be 45 million creative professionals -- I'm going from memory here, I think 700 million communicators and 4 billion consumers who we might have an opportunity to sell our products into. And that's a pretty massive population. Now when we build -- when we look at the TAMs, we then use our data science and our own research to estimate what percentage of those categories might have a propensity to pay and how we might go to market in those segments. But I would -- we'll update the TAMs later this fall when we do our analyst meeting, yet to be announced. But I would say that all the trends we're seeing are even more interest globally around telling stories and creating digitally. And there's such an ecosystem of companies and creators and platforms. It was predominantly YouTube and Facebook and then Instagram. Now we're seeing TikTok and Snap. There are so many platforms where people are sharing creative content. And ultimately, all of those creators globally, when they hit the point where they can't do what they want to do with free tools, Adobe is the company they go to when they're ready to be able to do more and really kind of take that interest to the next level and learn to use powerful tools. And it's a massive opportunity. It's one where what was once just a story of taking a perpetual installed base and converting these creative professionals over to a subscription. It's been for years now, like you said, a story of new user acquisition. And we're acquiring new users from new categories, geographies. And then we're finding ways of bringing them in on simpler tools where they're just -- we're asking them to pay what cost a couple of lattes a month and which -- that's a pretty low price point worth of users we're attracting and, ultimately, getting them hooked on the creative process, and they're wanting to learn more and more and more and upsell them to the full suite. So with the momentum we showed in Q2, the number of new users that we continue to acquire, it's a long runway. And there are other ways that we add growth to the recurring revenue stream that we have. The upsell is one of those ways. You get asked about pricing a lot. But really, when you have such strong growth of new user acquisition, pricing is not one of your top levers that you consider because you're really just bringing in, again, millions of more users into the franchise every year.

Perfect. Terrific. Jonathan, to take a step back, I want to talk just a little bit about the moat and the differentiation. You're competing in the marketplace really against kind of 2 forces. You've got these mega tech companies like the Salesforce.coms of the world, the Oracles out there. And then you do have also kind of best-of-breed SaaS companies, Shopify, DocuSign and some of the categories that you're competing in. So can you take a few moments and just share with us why you win in the market?

Sure. Something -- and this is often missed. When we talk to competitors, they sort of assume that there are various vendors that all have relatively overlapping solutions, and they want to know who wins. When you look at the enterprise category that we compete in, the strength in our technology stack comes in areas that the competitors don't even offer. So what differentiates us from Salesforce or Shopify or Oracle is our customers. Our enterprise customers are running their website in real time, making millisecond decisions using Adobe technology. That began with the leading web analytics product globally in Adobe Analytics, which we acquired from Omniture. And then if you look at any Forrester report, Gartner report and any industry analyst report, you'll see that Adobe Experience Manager is the world's leading web content management solutions. So large enterprises are using Adobe technology to measure exactly what's happening in their web applications and mobile applications in real time and in milliseconds to deliver different experiences to different users. You and I, if we go to a large website, Brian, would see different content because they would know you're on the East Coast, you like these sports teams, not those sports teams. Your web browser makes assumptions based on behavioral data about who you are and what you like, and you get experiences based on that. And no other company that we really compete with offers those solutions. And so when -- we call it owning the glass. When you own the glass of the enterprise website, you have a competitive advantage when you're selling the commerce solution or bringing all the -- when we look at the big opportunity ahead of us in bringing all of the data together into a customer data platform that gives enterprises a single view of their customer. With Adobe, that data is coming -- the signal that you're measuring is coming from all of the consumers in real time as they click on mobile apps and they browse the website whereas competitors, that data might come from a CRM system or an ERP system that lags as that data is entered over time. And so Adobe is the -- because we own the glass of enterprise customers, we're the only one that's really able to measure it and then make it actionable in milliseconds. And that's the big competitive differentiator there, and that's why we win. And then just quickly on the document side, the PDF franchise we built is just massive. We have a reader installed base globally of over 1 billion of devices worldwide. We invented and standardized the PDF, which has become sort of the digital document lingua franca. It's the way people trust documents. If you get an e-mail from maybe an unreliable source, and it's a PDF versus a Word document or an Excel file, your level of trust for that document changes. We're really focused on that PDF platform that we built in helping organizations move all of their document processes, not just signature but anything they want to do with collaborating, creating forms, securing documents with PDF, and that's just something that no other company has.

Jonathan, I wanted to ask you a quick question, well, a question on the Digital Experience business. And on the leadership transition because earlier this year, the company, they brought in Anil over. He was the CEO of Informatica to fill the general manager position. And so I just wanted to ask you if you've seen any meaningful changes in the sales process on the new leadership or if it's mostly been seamless with business as usual. So can you share with us how Anil and others plan to strengthen that business and build upon the prior successes?

Yes, sure. And Anil has been a great addition for Adobe. We're excited to introduce him more to the investor community later this year as well at our analyst meeting. We brought in Anil looking to unify an enterprise organization that included product and sales. And that's a very specific skill set that not many have. Anil with his background in technology, MIT, PhD, led sales for Informatica. This was a vision to bring him in, to really have that really broad mandate. And it was -- and Matt, who led our sales since 2007, stayed on to really help with the transition. And we had a great bench in sales. We have a leader for the Americas and then a leader for rest of world, both Senior Vice Presidents who report to Anil. And they had a 6-month period of time to kind of work on that transition. And Matt retired late last month. So we're really excited now to have everything aligned under Anil. And you saw in his leadership and some decisiveness when he looked at what we're looking to grow and what the real strategic priorities are for us. We made -- Anil made the decision to exit the ad agency sort of business that we had acquired from TubeMogul in Q2, which really, I think when you looked at -- when you bring in a new leader and look at the business and the opportunities, it's kind of a no-brainer to do that. And he's really focused kind of with a 5- to 10-year vision out on helping enterprises get to the point where we're not making their lives hard by having to be system integrators. Right now, the front-office software marketplace is so fragmented. The enterprises really have to become integrators of all of these different systems and there's lots of point solutions out there. And Anil's vision for the data platform, it is an open, extensible platform that can integrate with any products and systems that companies are using, any sources of data. And our belief is that eventually, company -- you won't see such a fragmented front-office software ecosystem where there's a lot of point players that you might get value for a couple of years, but then you're going to have to rip and replace that out to integrate with something broader. And we think there are only a few companies that really will be in a position to offer end-to-end solutions to really make enterprises' lives easier, so they don't have to focus on being system integrators but really focus on what are the insights we're getting, how can we take action to grow value in our business. And his vision is pretty inspiring. He tells the story amazingly well for someone who just joined the company 8 months ago. We're really excited about what he has ahead.

That's terrific. We're out of time. I want to thank Jonathan Vaas. We're all going to be seeing a lot of Jonathan here over the coming years. So I appreciate him taking the time to share with us the company and the opportunity, and thank you all the listeners for dialing in this afternoon, too.

Thanks so much, Brian. This has been fun.

Take care.