Eventbrite, Inc. (EB) Earnings Call Transcript & Summary

Okay. So we're going to get started. I'm Dae Lee, JPMorgan's Internet analyst. And I'm excited to have with us today, Lanny Baker, CFO of Eventbrite. Lanny, thank you for coming to our conference.

Thank you, Dae. It's great to be here. Good to see everybody.

All right. So we're going to start off high level. So Eventbrite began as a ticketing platform. But the problems you're trying to solve are bigger than that, right? So starting there, like what problems are you trying to solve and why is Eventbrite the right platform to provide the solution?

We are trying to solve the needs of live event creators who have the challenge of monetizing their event in a predictable, reliable, safe, secure, trustworthy way. And we've checked that box off. And we go back to our customers and say, what other needs do you have. And the key thing that customers are telling us all across every category, every geography, free events, paid events is we want help reconnecting with their consumer audiences. We want help growing our followership. We want help finding -- discovering new communities who will engage with our creative endeavors. And we want help growing the size of our enterprises. And so the primary area where our customers are really asking us to take them today is helping them market their events and increase the demand and the ticket volume for their live events.

Got it. Okay. Yes. We'll get to all of those, but I mean, I guess, let's talk about the price for solving those problems, right? So -- or your TAM. You said at your Investor Day last year that your TAM is not simple to size and that you believe Eventbrite has a truly unbounded growth opportunity. So could you elaborate on those points a bit and share any frameworks that you might have around how to size the opportunity?

Yes. The live events market has been growing for decades really. And in that -- in our Analyst Day a year ago, we showed the trajectory of Eventbrite's ticket volume. And we, in particular, put that ticket volume up against things that are really familiar to people like the top 100 concerts or major sports leagues. And Eventbrite's ticket volume is now greater than all the major sports leagues plus the top 100 concert tours plus Broadway combined. And so the mid-market of live experiences is an incredibly dynamic, rich kaleidoscope of things to do in your local community. And the growth of that has been going on for really a decade. There are generational factors that are causing people to be excited about experiences over possessions. There is the whole influencer, social media sharing, creator economy that feeds into the live event experiences. And so as we look forward at the market opportunity, first of all, there is that dynamic of the experiences, economy, the creator economy continuing to grow, and it's well supported by technology that makes it easier for people to get their creative endeavor, their unique local experience out to the world. Secondly, we think a lot about the services that we can provide to those event creators. I talked a minute ago about helping them increase their marketing efficiency and expand the size of their audience. And then third vector of long-term growth is also the international expansion opportunity. So we see growth really in a bunch of different directions. The one that we're really focused on today, most sort of urgently, is expanding our -- the addressable wallet that we can serve amongst creators. Creators typically spend something just under 10% of the face value of the ticket on the ticketing technology that helps them monetize that event in a reliable, predictable, safe, trustworthy way. But then they turn around and they spend somewhere between 20% and 40%, maybe even 50% of the event budget on marketing that event. And the event budget is bigger than the face value of the ticket. In fact, according to research that we've fielded, most events generate as much revenue from merchandise, food and beverage, sponsorships, lead generation, memberships, materials that they're selling at the event as they do from the face value of the ticket. So the marketing impetus that creators have is much greater than just the face value of the ticket. It's the entire value of the event. And so we look at going from our really strong position serving that 10% of the face value of the ticket that goes toward ticketing to addressing this much bigger opportunity that's 20% to 50% of the event budget, which is inclusive of things just beyond -- or far beyond just the face value of the ticket. So that's a really big wallet opportunity for us to expand into with creators who frankly already trust and rely upon the Eventbrite brand.

Got it. Okay. We'll get to how you're tackling those opportunities. But I guess at the same event last year, you provided a helpful framework for thinking about your revenue model or the 5 gears and how each contribute to that 20%-plus revenue growth that you expect from your business. So it's been about a year. So I'm curious if your confidence level around that 20% target or the assumptions that underpin that have changed at all.

No. We still fully back and believe in that long-term growth formula for Eventbrite. And the sort of revenue highlight is 20% compound annual revenue growth on a sustainable basis and getting to a 20% plus adjusted EBITDA margin. We've broken down the drivers of that top line revenue into, as you said, 5 gears. The first one is growing the number of creators at a high single-digit rate on a compound annual basis for many of the reasons I just described about the growth of the live events, marketplace. The next 2 are the number of events per creator and the number of tickets per event growing in the mid-single digits. And both of those, when you put them together, they really speak to the consumer demand for live events. The third is the ticket price itself. And we don't have a lot of control over that one lever in our business model. What we've seen is creators sort of biasing toward keeping ticket prices steady right now in order to bring more people into the events for all those ancillaries that I talked about a few moments ago. And then the final lever that we do have a lot of control over is our take rate. What portion of the face value of the ticket or the value of the event can we tap into and the things that we talked about a moment ago, helping on marketing services and promoted listings and driving demand is a way for us to really keep driving the take rate. So mid-single-digit growth rate across the middle to low single digit on ticket price and kind of a mid-single-digit growth rate on the take rate on a compound annual basis. It won't be that way every single quarter. But over a long period of time, those are the ranges that we expect. And you put those things together, you have a very strong, well-diversified model that sort of has 3 main drivers, bringing on more creators, helping them find more consumers and getting paid more for doing both those things.

Got it. Okay. So I'll now focus on 2 of those gears, so paid creators first. And this is a 2-part question. So the first part being like what's the best way to think about the drivers of paid creators growth going forward. And then part 2, like how do you think about competition? And what's the moat that allows you to protect your creators and especially the frequent creators that you focused on in recent periods?

Yes. Well, in bringing creators onto the platform, we have a huge brand visibility and an enormous scale advantage. Last year, we ticketed 284 million tickets, and that number will grow this year. And every creator is also an attendee, and that dragnet of events that are ticketed on the Eventbrite raises the awareness of our platform amongst event organizers as well as event attendees. We have a tremendous organic customer acquisition engine that builds off of that. 98% plus of our creator acquisition is organic of people logging on to the website, setting up the event and many of them never ever talking to anybody at Eventbrite. It's a self-service platform that's fully scaled, very simple to use and easy for people to adopt. So the main driver of our business is this flywheel of this great variety of all the different categories, all the geographies, all the different formats of events, bringing awareness of Eventbrite to event creators who then come back and say, "Well, what would it be like to set up an event on this platform?" And they find it really easy and really intuitive to do that. So our creator acquisition engine has been really proven over a decade plus, and it remains as strong today as ever. Last quarter, we had the best new creator additions to our platform in 3 years. So I think that looking forward, the addition of this awareness, this growing awareness that when you list an event on Eventbrite, you sell more tickets because of the distribution that we have to consumers, is also a tailwind propelling or bringing creators onto our platform for -- at the end of the day, the key thing they want to do, as I said, is sell tickets, bring people into their event and expand the size of their franchise. So remind me of the second question that you had -- oh it was about competitive.

Yes, competition, how you think about the moat that allows you to keep or protect your creators.

Well, I think our moat, I'd say there are -- at the simplest level, there are really 2 pieces. One, we have a very low-cost customer acquisition engine that I just described. Our -- we -- not only do we have a very strong business amongst creators of paid events. We also allow people who create free events where there's no ticket price, but it's a ticketed event, but there's no admission fee, to use our platform for free. That creates a huge amount of awareness and exposure and relevance and search engine reach for us that also feeds into our ability to acquire customers at a very low rate. So that low cost of customer acquisition allows us to put our resources into improving the performance of the product. So there's a big moat around our company on the scale of our creator volume allowing us -- and the efficiency of our customer acquisition allowing us to invest in our product at a rate that nobody else in the industry matches. Now after -- that's almost like the bridge into the castle. The moat that keeps them -- keeps our customers there, increasingly, is this awareness that when I have my event on Eventbrite, I sell more tickets. Today, about 25% of the tickets that sell in a quarter, in a year, in a month come from Eventbrite-originated channels. And by that, we mean people who come to Eventbrite saying I'm looking for something to do with my friends on St. Patrick's Day. I'm looking for a food and wine festival to attend this weekend. I want to go to an event with my kids in Western Massachusetts next weekend. That discovery experience and that browsing experience, the e-mails that we send out to prior ticket buyers, marketing to them, "Hey, you went to this event. We think you would like this event from the same creator or in the same location or the same kind of event." That accounts for about 25% of the ticket sales. I believe 20% of our creators get -- or 20% of the events on our platform get more than half of their tickets from those Eventbrite-originated channels. We are ardently at work in bringing visibility to Eventbrite's demand generation and at the end of the day, that idea that if I move away from this platform, do I have confidence I'm going to get that boost of visibility, I'm going to get the marketing tools, I'm going to get the opportunity to promote myself as well I have on Eventbrite, it becomes a real challenge for craters because when you look at our scale, 284 million tickets last year. I think our web and mobile app traffic is growing at 37% year-over-year in the first quarter. Our mobile -- we have 20 million MAUs on the mobile app. And our web reach for the Eventbrite franchise is multiples of the next 5 or 6 competitors, their reach put together. So as we bring greater awareness and visibility to our -- really our muscle and our power on driving demand, it becomes a pretty high switching cost and it becomes a real defensive moat for us.

Right. And you built that engagement without spending a lot of sales and marketing dollars, right?

That's right.

Okay. All right. So let's double-click on the demand generation portion a little bit. So Eventbrite Boost and Ads, those are fairly new product for you, but -- and they're 2% to 3% of revenue today. So I guess could you explain to the audience what they are and what's the best way to think about how they contribute to your growth going forward?

Sure. So 2 different products, as Dae said. One is called Eventbrite Boost and one's called Eventbrite Ads. Eventbrite Boost is a social media marketing tool set for creators. You -- the creators will use Boost to manage their digital marketing of their events. We help them with our data identify the right audiences, the right properties, the right keywords that they should use in digitally marking those events. We have so much data. We can look at all those ticket sales that come into our Eventbrite engine. We can look at what the source was, the referring engine that brought that traffic in. And that really helps inform us to make recommendations to our creators about where they should be spending their marketing money. Secondly, because the Boost system is connected to the Eventbrite ticketing platform, it's very easy to track. If you put an ad on Instagram, how did it perform? If you put the different ad on Instagram, how did the 2 compare? If you ran on Instagram and another property, how did those 2 compare? And we're very quickly able to help creators optimize their spending across those different platforms. And what we found over the last year in our customer research and observation and interviews with folks is that using Boost is helping creators get about a 60% improvement in the return on ad spend that they're doing across social media. So there's also an e-mail -- a suite of e-mail marketing tools attached to Boost. We have e-mail deliverability rates that exceed what most creators are able to get on their own. We priced these products really efficiently. It's $50 a month to get access to the Boost product, which is basically you need to sell 1 extra ticket to pay for -- maybe 2 extra tickets to pay for the value of that. And if we're talking about the kind of improvements in performance that we are delivering, that's been a pretty attractive sale for us. So that's Eventbrite Boost. It's a very important part of where we're going as a company to build a differentiated message and value proposition at Eventbrite around this is the company that knows event marketing in the digital realm better than anybody and has the tools to help me do that really effectively. Eventbrite Ads is a similar, I guess, thematically, but it's a different product. It is an ability -- and creators have been asking for this for years. It's an ability for creators to elevate the visibility of their event listings within the Eventbrite product experience. So it's not a whole lot more complicated than sponsored listings. You'll see our results page for music events this weekend in New York City. And on that page, there'll be an advertiser, a creator who has spent some advertising money to push their event to the right location in their category, on their day, in their city. On our mobile app, it's available. It's available in some of our e-mail push products. And we are expanding the availability of Eventbrite Ads. It's in about 25 cities today. You can also -- if you have an online event, you can run -- you can promote that in -- through Eventbrite Ads. And it's -- we launched it in July. It didn't exist before July. It's now at about a $4 million annual revenue run rate, growing really, really quickly, and we're very optimistic about that. It sort of loops back to what I said at the start. We know the ad budget that creators have. The marketing budget that they have is really significant. We may not have the world's biggest audience. But amongst ticketing platforms, we definitely have the biggest audience and the intent of the consumers on our platform is extremely high. So it's a very effective advertising vehicle for those creators.

Right. Okay. Yes, that makes sense. So I guess moving on. So in recent quarters, you talked about becoming the premier live event marketplace as the next phase of growth for you guys. So what does becoming a marketplace mean for Eventbrite?

I want to say your conference is a marketplace. And if you think about how the presence of great investors, all the investors brings out all the people who are in this -- all the different companies that are coming here, the reason we come, it's that 2-sided marketplace. And we are in the process of igniting that growth dynamic at Eventbrite as well. So that creators have visibility and say this is the place where the events are purchased. This is the place where the consumers go. This is the company that is distributing events into third-party venues to really boost the visibility of those events. And the consumers for their parts say, I'm looking for that thing to do to fill up my calendar, to take my friends to, to do with my family. And Eventbrite is a place where I know it's going to be high quality, trustable, attractive experiences. I'm going to be able to measure -- evaluate those experiences. They're going to showcase them to me in a very consistent, reliable way. And we sort of build that 2-sided marketplace that is -- that exists in so many other categories, and we think Eventbrite really has a unique right and ability -- a unique position to build that for unique local live events.

Got it. Okay. A lot of work on the product side. So let's talk about getting paid for all the work that you're doing, right? So take rate. Your take rate expanded from 7.1% in 2019 to 8.6% last quarter. So can you first talk about what the biggest drivers of that expansion were?

Yes. I love that you point that out because comparisons to 2019, people make all the time. Our take rate has improved. I remember at the end of 2019, our revenue was growing a little bit under 10% year-over-year, at midpoint of our range. This year, it's in the low to mid-20s. And our gross margins in 2019 were 7 points lower than they are today. Our EBITDA margins were 15 points lower. Our take rate was, what did you say, 1.5 points lower than it was today. What has driven that? All those things have been driven by, I'd say, 2 things, a focus on the best customers in the marketplace and those are the creators of frequent events. And I say they're the best because in order to have a frequent event, you have proven that the consumers out there in the world are interested in what you're putting on stage. And so you're bringing it back week after week after week, month after month. And they are the ones with highest LTV. They are the ones with the strongest brand recognition. They are the ones with the best content that pulls people into our marketplace. So we made a very concerted shift in our product strategy in 2020 during COVID to focus almost exclusively on the needs of frequent creators. And we made some major upgrades to our product that have been rewarded with improved retention among frequent creators. And the primary -- not to go too deep into it, but the primary thing was really improving the product experience for the creator of multiple events versus the creator of a single event, so dashboards that let them manage multiple events and monitor multiple events and schedule things really easily and really efficiently. So number one has been focus on that segment. Why that segment? They're 30% of our customers, but they're 70% of our tickets. There's no other slice you can take of the mid-market of live events that's going to come up with 70% of the ticket volume. It won't be music. It won't be New York and Los Angeles. There's no other market opportunity as sizable as that. So we picked the biggest market opportunity, and we recognized we're kind of in a unique position because we've never been category specific to observe that the needs of a frequent creator of pub crawls, their product needs are not a whole lot different from the needs of a frequent creator of art -- open-air painting experiences. And so we built for them, and that has really been essential to us. So number one was product focus that has allowed us to get the best customers who are willing to pay the most for the product that we've delivered. So where, in the past, we had to discount for people who were on the edges of our marketplace or parts of the market that were less or more competitive than what I just described, we're no longer -- like those are not central areas for us. And so our pricing power has improved. In fact, earlier this year, we raised our core ticketing prices by about 10%, and we've seen very little pushback. We've made a lot of investment in the product over the last 3 years. Net Promoter Scores, customer retention had improved during that period of time and we really felt we had license to improve that. We've also grown the sort of the secret sauce, which is the Eventbrite-driven demand has grown really markedly. And so we're starting to price into that. So at a fundamental level, focus on the product, improving the product, those have been the underpinnings of the -- sort of the heart of that improvement in take rate. There's a small sideline effect that's starting to grow, which is additional revenue outside of the core ticketing business from our marketing tools, Boost, and from the Ads product, are starting to layer on top of improving take rate for the core ticketing business. I think from here, as we look forward, there's a lot that we can do with pricing and how we package, all these different things I'm talking about. And there are really big growth opportunities for us behind Boost and behind -- or through Eventbrite Ads.

Okay. Yes. And we'd like to talk about what next, so take rate. I think in the past, you said you expect that to grow into double-digit levels over time. Do you still expect that? And if so, is it going to be more driven by these value-added services? Or do you still feel like there's room for upside from your ticketing platform as well?

There's upside on both fronts. I mean, I think that in the long term, the opportunity to go kind of, if you will, up the funnel into the marketing needs of creators is a really big take rate opportunity. Just to participate in more of the infrastructure of the event, bringing people into it and frankly, participate in more of the economics of the event. The thing that we see on the advertising product, 2 things that are very important is: one, for most creators, the incremental profitability of the next ticket is really, really high. There's not a whole lot of like -- have one more person in this room isn't going to cost JPMorgan a whole lot. And so creators have a very strong willingness to pay for that incremental audience, and we can help them with that. And then the second thing is that our free creators are adopting these marketing tools. I said earlier that we have historically ticketed free events for free, but when it comes to helping those free events who have merchandise and food and beverage and sponsorships and other things going on at that event, when they come around to Eventbrite saying I help -- they want help with the audience growth, well, there's a Boost product to subscribe to and there's Eventbrite Ads to promote your event. So today, about 25% of the revenue that we're seeing on Eventbrite Ads is coming from free creators. And that's the first time we've ever pulled any revenue out of free creators. And last quarter, I think we had -- if I remember correctly, we had 115,000 paid creators. We had about 170,000 free creators. And so there's a really big opportunity to pull in economics from those free creators. There was a second part to your question.

Double digit.

Okay. So -- yes, so I think I answered the question.

Yes. Okay. Yes. So I guess let's move on to near-term expectations. So this year, you expect to grow revenue 21% to 26%, so within that target that you laid out. So just curious what macro assumptions underpin this guide and what are the key puts and takes to think about at each end of the guide? And it's only been 2 weeks since you reported earnings. I assume there's no change.

There is no change. And our -- at the high end of the outlook range, I think that would be connected to really great success in our product -- consumer product efforts that we're undertaking this year, some of the marketing that we're doing, where we're changing a little bit our go-to-market messaging to emphasize the demand generation, value proposition, strong growth from Boost and Ads and the -- like full benefit of the price increase that we took with no sort of customer churn or any of those kind of things. Those sort of tend to put the number at the high end of the range. And the factors that I think would cause the numbers to trend for the year toward the lower end of the range would be macroeconomic uncertainties that impacted either creator's confidence about putting on events or consumer purchasing of live experiences. Also another thing that would put us at the lower end would be if we saw some churn from a price increase that we took earlier this year. So far, we've seen very little of that. We also -- we did a reorganization, restructuring earlier this year. And if that caused disruption, that might put us toward the lower end of the business. I'm happy to say, at the end of the first quarter, we didn't see any of those downside cases. We saw a very resilient consumer in terms of their interest in going to live events. And we've seen, I would say, kind of like a reduction in the latency between the time that there is strong consumer demand and that creators then meet that with incremental events. And so right now -- I mean, we had very strong growth on the consumer side of our business, and we also had our best quarter in 3 years on new creators coming on to the platform. And that's a bit different than we've seen in the past. So right now, I think the macroeconomic assumptions are we continue to be in this place of some macroeconomic uncertainty but a lot of consumer enthusiasm for going to live event.

Got it. Okay. All right. So we're going to shift gears to profit. So it feels like, I mean, at least to me, that you guys are in the cusp of an inflection point around margins. You guided to 10% adjusted EBITDA margin for 2023 at the midpoint of your revenue guide and 20% by the end of 2024 and this is versus roughly 5% in 2022. So there's a lot to cover here, but let's start with the reorg first. So what -- can you talk to us about what you did, what work remains and how much savings you expect to see once you're done? And any timing you can put around that?

Yes. So we decided to do a reorganization earlier this year to operate our core ticketing platform as efficiently as we can and leverage those savings to go faster in the direction of the marketplace and consumer demand generation. And so what we've done is we eliminated about 8% of the roles in the company. We took out some processes, some vendor relationships and other expenses that we had that were related to the core ticketing platform that we think we can operate just more efficiently than we've run it in the past. And that will generate -- we anticipate savings in the neighborhood of $13 million, $14 million this year from that. We'll reinvest a portion of those savings in hiring talent, in the consumer product experience, in the advertising product, in personalization, in search engine optimization, in video enabling our listings really with an eye to making that consumer experience ever more engaging, relevant and eye catching. So that's kind of in the shorter term. A little bit longer term, we are also relocating a large portion of our workforce, about 30% of our workforce from Argentina and the United States to hubs that we already have established but that we want to be much bigger in Spain and in India. And we're doing this for a number of reasons. Number one is the depth of the talent pools for the jobs that we see that we're moving to India or that we're moving to Spain. Spain, it's mostly the consumer product experience and some advertising-related work where there's a very deep pool of talent there, and we have a very strong nucleus in our office there in Spain. So we'll be moving some engineering roles to end product roles there. On India, we see a very deep talent pool on the engineering side in more of the like behind the scenes, infrastructure, search engine optimization and some of those kind of more infrastructure-related development roles, and we'll be moving some of those out of the United States to that area. And then our customer service team, we have about 100-plus people doing customer service in Nashville largely or mostly in the United States, and we're relocating that to India as well. So as you look at this year, the story is like $13 million or $14 million of savings from the restructuring that we did in March with a portion of that to be reinvested this year. And then by the time we get to the end of this year, we will cut over from those locations in the United States and Argentina to the hubs that we are currently strengthening and building out in Spain and in India. So as you go into 2024, there'll be some elimination of a little bit of duplicated costs this year. That should give us something between 4 and 5 points of operating leverage next year. Another driver of that margin growth next year, we could probably get to, which is the revenue side of the equation.

Got it. Okay. I want to touch on the relocation a little bit more. So I mean, I guess what gives you the confidence that you won't lose any productivity from that shift?

Well, there's -- we've done -- we've been operating in a very distributed mode for quite a while. We have, I think, less than 10% of our employees are in San Francisco today. That was quite different pre-pandemic. But during the pandemic, we have switched to a almost exclusively a remote environment. We don't have an office in San Francisco at all any longer. We don't have an office in Nashville, Tennessee any longer. And so our -- we've been working at this now for 2 or 3 years. And in that period of time, we've seen product delivery velocity go from 20 new releases in a year to more than 60 major releases last year. We've made huge strides in the infrastructure of our service. We've introduced ground-breaking, like brand-new products in Boost and in Ads as we've embraced this. So this is not brand new to us, operating in this global kind of dispersed environment, and we feel that gives us some confidence for sure. And as I said, we believe the pools of talents in those markets are deep and we've got a pretty engaging set of challenges for people to work on.

Okay. All right. And then I want to touch on that 20% target by end of 2024. So what are some puts and takes to keep in mind when looking at that target? For example, is there like a growth or gross margin target, like a product rollout or investment cadence that we should keep in mind?

Yes. Well, so I mentioned one piece of it, which is on the expense side, getting to those lower-cost locations and getting -- and pulling out the sort of duplicated expenses that we'll have for a period of time this year is one step. But you put your finger on it. Really, the big long-term margin opportunity isn't from expenses. It's from revenue growth. In our core ticketing business, the unit economics are pretty close to 75% incremental gross margins in the core ticketing business. The overall gross margin of the core ticketing business we're saying can go into the high 60s, get very close to 70% because there's a little bit of web hosting cost in there and a little bit of customer service cost in there. But as we scale the ticket volume, that will move the gross margins that were 66% or 67% up, up. That's what they were, 66%, last quarter. It will push those up a little bit further. And then the growth of Eventbrite Ads and of our Boost product and kind of anything and everything that we're doing around demand generation is really accretive from a margin perspective. Eventbrite Ads has -- and Boost, they both have 20 point higher gross margins than our ticketing business. The reason for that is the ticketing business includes a credit card processing fee associated with the face value of the ticket that's being transacted, whereas -- that's not true. That's not the case with our subscription products and our advertising products. So as those go from being, as you said, 2% or 3% of the business to a much larger percentage of the percent -- of the business in coming years, including 2024, that has a pretty potent effect on the overall profitability of the business.

Okay. And we have 30 seconds. And the last question I want to ask is you're going to be a much profitable business next year. And I assume that opens up a lot more avenue for capital allocations. So should we expect it to change how you think about capital allocation once you get to that 20%?

I think you should expect us to continue to evolve it. And I think you've seen us do over the last couple of years is manage the capital to make sure that the company is fully funded and funded at an attractive cost to the shareholders. As we start to generate free cash flow in growing quantity, our doors really open up about things like share repurchases, retiring some of the convertible notes and those. And we'll get to those. In this year, as you said, kind of a 10% EBITDA margin at the midpoint of the range. We've got some restructuring costs to cover out of that. As you get to next year, things really start to open up.

All right. With that, we're out of time. Thanks, Lanny.

Thank you, Dae. Thank you to JPMorgan.