Roku, Inc. (ROKU) Earnings Call Transcript & Summary

Okay. Great. We'll get started. I'm Cory Carpenter, an Internet analyst at JPMorgan. And joining me this afternoon is Steve Louden, CFO of Roku. I think, as most of you know, Roku is the leading TV streaming platform in the U.S., by hours streamed, and has 54 million active accounts globally. Steve has been at Roku since 2015 and prior to that, held a variety of roles at Expedia. So Steve, thank you for joining us today.

Yes, thanks for having us, Cory.

So I'll kick off with questions, but if anyone in the audience would like to ask, one, you can click on the blue Ask a Question button, type it in, I'll see it on my screen, and we'll get to as many as we can. So Steve, I wanted to start with the content because original -- Roku Originals launched last week. So I thought that would be a good starting point. A couple of questions, but to start, what's been kind of driving your appetite to get more into exclusive and original content? Why was now the right time?

Yes, sure. And yes, hopefully, people have started to sample the Roku Originals. It's got -- kind of anchored by some of the Quibi content. I was just streaming Kevin Hart in Die Hart over the weekend, which was awesome. So give that a tune, if you guys haven't. But yes, in terms of The Roku Channel, I mean, it has done extremely well over the last 3.5 years. Yes. The reason we started the Roku Channel is we correctly identified that free ad-supported TV had an important role in a lot of consumer streaming. And there wasn't really a kind of a good scaled service out there. And then as the platform owner, there are certain things, we know who's watching, so we can have good data around recommendation algorithms. We can also monetize better because we know who's watching. We can sell targeted premium CPM ads. And that's created this flywheel where we get more content onto The Roku Channel. That drives more engagement. More engagement drives ad inventory. The advertisers are increasingly following the viewers over to streaming. That money, we can then put back into more content. And so the important thing about the approach to The Roku Channel, and I'll get to the why now on some things like Roku Originals, is that we believe in this free ad-supported model, and so that's consistent with where we're at now and where we plan to be in the future. And so this Roku flywheel, the scale that The Roku Channel is at, the amount of reach it has in terms of the number of viewers, the amount of engagement it has, that scale and just as importantly, the growth trajectory, right, it more than doubled year-over-year. It's growing twice as fast as the platform, which is also growing fast in and of itself. That scale and that growth trajectory allows us within that same free ad-supported business model to spend more and more on content to prime this flywheel. And so basically, we're at a scale and looking ahead, modeling the amount we can spend on content, where we can go into areas of content that we wouldn't have got -- been able to go in and stay within that model before. The core of The Roku Channel is really that licensing. We have 175-plus content licensing partnerships. The predominant model is the rev share, where we have roughly a 50-50 rev share split with the underlying content publisher. But we'll be able to augment that with more content. And whether it's original content, that's not really the focus, but there is original content that we have. And so that's interesting to blend into the portfolio. But a lot of this free ad-supported content doesn't need to be original. It just needs to be interesting to whatever viewer we have. And so that's why things like This Old House makes sense to us. That's a way to bring some of that popular content. Home improvement shows are some of the most popular shows in terms of the vertical. This Old House and Ask This Old House are 2 of the top shows in that vertical. And so there's also a play here in terms of it makes more economic sense over time given our scale to bring some of that in-house as well. So we're very happy with where we're at in the growth trajectory, but it's all in service of the same model that we've been charting forward since the get-go of The Roku Channel.

I want to talk a bit about This Old House. Unlike Quibi, and I guess, Cypher as well, it's not exclusive to The Roku Channel, at least today. So 2 questions here. One, I would be curious your strategy kind of around do you think this makes sense to continue to make available outside The Roku Channel? And if so, could you talk about how that helps your ad offering because presumably, you're not going to have ads you could sell against this content on other platforms.

Yes. So yes, This Old House is a great model. It premieres on PBS and then you can find it elsewhere. Like I said, a lot of types of content, especially in the free ad-supported space, they're not exclusive, and that's been the vast majority of content on The Roku Channel. I think that will continue. We don't have any plans to change how This Old House operates in terms of the PBS partnership and being available elsewhere. But we think it's a valuable asset to have those guys do a great job. And so certainly, being able to have that in-house and on -- featured on The Roku Channel is, we think, is a good value creation, creating activity. But yes, we're not -- the goal here is not to pull everything in and make it all exclusive. That's just -- that's not necessary for our free ad-supported model.

Okay. That's helpful. Last one on content. I promise, we won't spend all 35 minutes on it.

[ 36, 36 ]...

I think you launched 30 titles last week, Roku Originals. You'll correct me if I'm wrong, I'm sure. And more to come over time. How do you think about measuring the ROI on your content spend, just to kind of give us a sense of the level of investment we can maybe expect going forward?

Yes. I think for us, again, this is all in the lens of this free ad-supported model, so it really has to do with how much viewership it garners. Obviously, we've set the ad load in The Roku Channel to roughly half of kind of the traditional linear TV full ad load of 16 minutes. And so a lot of it just has to do with that general ad economics of how much viewership does it drive relative to the cost to produce it. And then obviously there, we've got to sell the ads, so we need demand for that. And that can factor into what are the demographics or other targeting attributes that make certain audiences more or less valuable. But it's a pretty simplistic way to figure out the ROI. And the good thing for us is as The Roku Channel has been out there a bit longer, like I said, we're about 3.5 years on that, and as the scale has grown, we've got more and more data. So we're having a -- we have better estimates of what kind of content, like how much viewership it will drive and what type of viewership and who it might appeal to. And that just allows us to make smarter decisions, whether it's on the kind of standard licensing side, say, for a fixed license, or whether it's something we might want to bring in-house. So it's all data-driven. It's a pretty straightforward ROI calc.

Right. I mean you had This Old House available already. So presumably, you had a decent idea of who was watching it before the acquisition.

Yes.

Shifting gears to a couple of, I don't know, hot topics, recent topics, whatever you want to call it. YouTube TV and then also media consolidation, I think 2 areas where we're probably both getting a ton of questions. Maybe starting off with YouTube TV. Look, there's been a lot of recent back and forth, of course. I think the latest move, Google created a clever workaround through the YouTube app. I guess what kind of stands out to me is this doesn't seem like your typical carriage agreement like you've had in the past. So my question would be, is that a fair characterization? And if so, could you walk through maybe some of the issues that made you say, "All right, we got -- we need to draw a line in the sand here."

Yes. And I think, Cory, it's a very astute observation because I do get a lot of folks that say, "Hey, this -- is this just another carriage dispute," and it's very different. The standard carriage dispute, whether it's on the traditional side or in the new streaming ecosystem, is really a content publisher and a platform trying to wrestle around the economic deal and certain points within that. This is -- just to be clear, this has nothing to do with an economic deal. We're not asking for any more money or any more value. What we are asking for and what is an important line for us is asking Google to be reasonable in kind of 3 key areas. One is to not manipulate the search results on Roku. Two is to not try to require us to withhold -- or divulge, personally identify info and consumer data that we don't provide to anybody. And then the third piece is not to try to require us to do certain things on the device side of things that would increase our cost basis and hence, erode our BOM cost advantage that we have from Google products like Chromecast and like Android TV. And so those are all part of their asks. We think the fact that we're not asking for any more economics or value and just asking them to stop these things that we think is a total overreach are pretty fair and reasonable. I mean ultimately, we're a consumer-oriented company. We want to offer the most value and the most content out there. And so hopefully, we get to a good spot. But for us, these are 3 things that are -- we can't tolerate.

Okay. That's helpful. And then on media consolidation, never a dull moment, Discovery, WarnerMedia. I think that was, last week now, a speculation of MGM and Amazon. Curious to get your thoughts on the consolidation we're seeing. And then more specifically, from your seat, what does this mean for Roku?

Yes. So it's -- I mean, first and foremost, for us, it's just further evidence that the world is moving to streaming and a lot of the legacy media companies especially are leaning into streaming. I think for -- not surprising for us, that one of the ways they do that is to try to consolidate on the content and build up their content library. So this is something that we were anticipating in some form. And for us, I mean, it's -- I think it validates the thesis that we're built on, that all TV will be streamed. I mean frankly, we're the best place in the streaming ecosystem for all content publishers to go, right? We're a neutral platform. We have the best audience development capabilities so we can help services build audience, retain audience, promote certain content. And so -- and frankly, we work with all these guys in one way or the other. So I think given that The Roku Channel -- we've got The Roku Channel and then we've got the platform overall, and we're, like you said, at the start, we're the #1 streaming platform by streaming hours, so engagement, we're in a great spot to help people add value as they push into streaming.

One kind of related question, and I think it's kind of getting at the heart of the consolidation, is just the balance of power and how it shifts over time, especially as media companies start to scale their streaming offerings. I mean for example, the question we get a lot is, okay, you sign a 1- to 2-year contract. Maybe I'm not -- this isn't a single [ Disney+ out ] by any means, this is just as an example. We're [ not up ] for renewal now. All of a sudden, you're negotiating with someone who was in the tens of millions of subscribers and now has 100 million subscribers 2 years later. So I guess my question is, is there a risk that Roku gets worse terms when you sign renewals with some of these streamers as they scale? I mean is this a valid concern in your view? I just would love to get your thoughts on the dynamic.

Well, I mean, certainly, in any ecosystem, you've got to figure out like what are the dynamics between partners, right? We're sort of partners and competitors to different players within the industry. Certainly, yes, consolidation, the reason folks are consolidating in any industry is because they're trying to improve their position and their heft when they talk to other stakeholders. But for us, I mean, the best thing we can do and what we've been very successful at is growing our share and our relevance in the ecosystem, right? So we're #1 on the TV OS side, where, last year, we're at 38% of Smart TVs sold in the U.S., were running the Roku OS. We're 1 in 3 and #1 in Canada. We're now #2 overall in Smart TVs in Mexico and the #1 licensed operating system. We sell a ton of players on that side, and we've got the most engaged audience. So certainly, I -- what we've observed is the fact that as our business model has worked in terms of driving scale, engaging -- getting more engagement from the consumers and then monetizing, we've been getting, on average, better economic deals. And so the trend so far has been -- our scale has been growing extremely rapidly, and so that's been positive. So I'm very happy with the momentum we've got going in. And again, our -- the reminder is our business model is purposely designed to align with our partners, right? They get more value on our platform, we have an economic share of that revenue. And so we look at that as a potential for a win-win. And then just in Q1, as a specific example, we mentioned that the content distribution side of the house and also media and entertainment, who are -- both of those areas are focused on content publishers, they had amazing quarters. And part of what we had, not to delve too far into 606 land, but we had great kind of increase in value in our content distribution models. And they included value from new services that came online that we helped be successful. We had a couple of material deal renewals that increased the value of -- the lifetime values of those deals because we got incrementally better economic terms. And then we just had more usage of the portfolio in general. And so there is increased value there. So that all points to great momentum on this space.

Okay. Kind of shifting a bit to the current environment. So I mean, we've certainly seen the shift to streaming accelerate quite rapidly over the last year or so. How are you thinking about the sustainability, especially as the world hopefully starts to normalize a bit? Any risk? I think it manifests itself a lot with you guys in active accounts. But do you see any risk that ad dollars could perhaps start shifting back to linear once things start to normalize?

Yes. I think, certainly, we mentioned on the call that it's going to be kind of a wacky year, a volatile year for year-over-year comps in any different part of our business, right, whether it's active accounts or streaming hours or the player business or the platform monetization segment. So any given quarter of looking at stuff on a year-over-year basis gets a little tricky. Some have easy comps, some have hard comps. But in general, we look at -- the world is moving to streaming, and COVID was an accelerant to getting to that end state faster. So we don't anticipate that sort of the world will move kind of whole -- held back to the old world. What we see, and this has been consistent historically, is when consumers move over to streaming, they're very happy with the experience, right? They get more content. They get it on demand. A lot of times, they're fleeing their overpriced cable bundles. And so it's just a better value prop for consumers. Similarly, I think on the ad side, I mean, we did see the ad budgets greatly lag the consumer shift to streaming for a number of years. There's still a massive gap in terms of how much streaming has moved over or how much viewership has moved over for TV into streaming. Depending on who you believe, that's 1/3 or more of that in key demographics. And the ad budgets [ that have ] probably moved over, [ they ] are probably still high single digits or maybe 10-ish percent. So there's a massive gap. But I do think that the pandemic, the economic issues around that, basically broke some of the inertia on the TV industry, just kind of staying with what they've been doing. And so we've been seeing more demand, not less, coming over. And the thing that's heartening is we -- when you come and you use the -- Roku on the advertising side, the ROI is tremendous. And so we had a stat where, basically, of advertisers that were there a year ago in Q1, we basically had complete retention of those advertisers. So I'm pretty confident that it's a better mousetrap. They need to follow the viewership anyway. They're well behind that, even though they're accelerating. And so that speaks to more opportunity, not less as things open back up.

So maybe bigger picture. So you have 54 million active accounts, and most of those are in the U.S. Maybe one day, we'll know the specific number, which really isn't that far behind kind of the likes of Netflix, which is closer to 65 million active accounts. So I guess, my question is, what I'm getting at, is how much more room do you see for household growth in the U.S.? Or are we starting to kind of reach a point of -- saturation is not the right word, but where account growth is coming more international and then growth at least in the U.S. is more driven by ARPU.

Yes. I do think there's more opportunity in the U.S. in terms of scale. Certainly, yes, that's a common comp to look at, Netflix. But I think, for us, as a platform, there is a bigger opportunity. We look at that platform opportunity as basically being everybody that has a broadband connection in the U.S. or as a TV household, which is over 100 million. And so I do think there's more room to grow. Certainly, at some point, you'll sort of asymptotically hit the limit there. But I do think the U.S. has been growing nicely for us for a long time, and I do think there's more room there. You've kind of correctly identified the phases of the business model, Cory, in terms of the U.S. will become more and more, over time, a ARPU story, and we are seeing ARPU lifting very nicely, record trailing 12-month ARPU in Q1 versus in international. There's a lot more greenfield there. But what we see is that the U.S. business model ports to international very nicely. And we've got countries that we're in that are at various stages of that 3-tier business model, right, growing scale, driving engagement and monetizing. But for the most part, international will be much more focused on building up scale in most of these markets for a while and then will eventually get to the monetization side. But it's -- that will be on a market-by-market basis.

So that's a good segue. International, I think, was the next topic. You've hit on it. You've been very successful in Canada, Mexico. I don't know if you agree with this, but maybe the U.S. has been -- or U.S. -- the U.K. has been perhaps a bit tougher. And you're still very early in markets such as Brazil, where you recently launched. So the question I think I would have for you is could you give us an overview of just kind of the, maybe for those newer to the story, the state of your international business. I think people in the U.S., sometimes, it's such an ubiquitous product here, forget that you're really just scratching the surface internationally.

Yes, it's true. I mean job 1 at Roku has always been win in the U.S. or continue to win in the U.S. U.S. is much further along on the move to streaming than any other country out there. And it's the most lucrative market on an ARPU potential basis. So especially when we were smaller and had more limited resources, job 1 was always win in the U.S., and that's really important. We've obviously -- the majority of our -- the vast majority of our accounts, as you mentioned, are in the U.S. And certainly, we've made really good progress in the U.S. So we have put into international, we've been putting more and more resources. [ It's in more ] key investment areas, along with the Roku TV, The Roku Channel and then the ad business, of course. But it is one of our strategic investment areas. So we've been putting more, more emphasis on that. Right now, our footprint is not particularly large, but we are in places like Canada and Mexico, Brazil, U.K. We're in most of the other Latin American countries, one way or the other, in France. But it's been very focused. And certainly, COVID has not helped in terms of getting into new markets over the last year and change. But what we've seen is a lot of evidence that the playbook works. Like the key differentiators that made us successful in the U.S., the low BOM cost, the neutral positioning, the relationships we have with retailers as well as the fact that we're free ad-supported experts with The Roku Channel, that's even more important internationally. Those all port very nicely. So that's something we'll continue to grow.

Could you talk about just the competitive dynamics internationally? How different are those versus the U.S.? And maybe, specifically, you've been so successful in the U.S. with your OEM partnerships, TCL amongst others. Could you update us on some of your OEM partnerships internationally, where you're starting to see success?

Yes. Like I said, I mean, the overall -- each market's got different dynamics, but each market has similar setup criteria in terms of we need retailer relationships. We need TV OEM relationships ideally. We need -- we've got a great base of kind of global content through our -- through the services on Roku, but that needs to get augmented with local in-language content, some of the key players locally that we don't already have. And so there's a lot of work we do upfront to make sure that we've got the ecosystem -- the ecosystem has built up as possible and bring as much of the competitive differentiators I laid out to bare as quick as we can in different markets. So I think the -- in certain markets, we follow that same playbook. Like Mexico, I think we're close to 10 TV OEMs. We started with a couple of them when we built over there. You mentioned U.K. earlier. I forgot to sort of talk about that specifically. We brought the Roku TV to that market a little over a year ago with one OEM. I think we'll continue to build on that. U.K., just a sidebar, U.K. is a bit of an interesting historical market for us. The primary way we engaged in that market historically was with the Sky partnership. So we white-labeled the Roku hardware and Roku OS for Sky's NOW TV. So for the most part, we kind of left U.K. alone for a long time. And so part of the reason why some then kind of look at the U.K. and say, hey, that -- you haven't made as much progress in that, we applied that from a very different approach. That Roku Powered partnership program, we've kind of deemphasized that globally, and now we go in with Roku-branded players in TVs. So certainly, in the U.K., we made good progress on the TV side with the introduction there. We also added The Roku Channel. That's the second international market behind Canada that has The Roku Channel, and we're starting to sell ads there as well. So certainly, we'll continue to grow scale there, but there is good tangible progress on that side. But in general, the relationships we have, I mean, most of the OEMs that we work with are global or pan-regional OEMs. And so we have the same conversations. They're usually with different teams within the OEM. But we know the right people, and so that's something we'll continue to build out.

Maybe sticking with OEMs, some have certainly chose to partner with the likes of Roku. Others partner with Amazon or Google or whomever. But there's also many that are still giving it a go at their own operating system, Samsung, LG, VIZIO probably, off the bat. Curious your thoughts on how your conversations with OEMs are evolving. As you think -- as we think like 3, 5, 10 years out, I mean, do you think that we're going to have this highly fragmented base that we have today? Or do you think there's more consolidation around a handful of partners, like we've seen like in mobile over time?

Yes. Well, yes. I mean, one of the original hypothesis that Anthony had was that TV will be an emerging computing platform, in that if you look at the historical computing platforms and the shift from, say, mainframes to PCs, PCs to mobile and now mobiles to TV as sort of the newest scale computing platform, the incumbents haven't won in that setup. A purpose-built operating system for that new platform has been the one that has won the kind of #1 position and lion's share. And so that was certainly true in mobile. We're not all on Windows mobile phones. My wife used to own one of those, that it wasn't particularly competitive with, say, Android. But what you have, like let's pick on mobile, you have Android that has the majority of mobile phones out there, and then you've got iOS that's got a very lucrative second position. And so we do think that there is a best-in-class licensed operating system for TVs, will take the majority of share. And then maybe there will be 1 or 2 other sort of more niche ones that are out there. I mean we are making great progress toward being that default operating system. I mean the Roku TV program is about 5, 6 years old, and we've gone from no market share in the U.S., to almost 40% market share. So I do think the market is speaking. It's cheaper to build the Roku TV. It's got more content, it's got a better user interface, so it's got lower return rates. We've got great retailer partnerships. So for some of our OEMs, we can help them get placement they wouldn't get on their own with the non-branded -- or non-Roku branded TV. So the market is speaking, right? The names you mentioned, if you look at their market share in the U.S. from 5 years ago to now, they've lost a lot of market share, and they've lost it primarily to Roku because it's a better mousetrap and it's purpose-built. And so I do think that's the way a lot of the OEM handsets went when mobile moved over, and I think you'll continue to see the same thing on the TV side.

Shifting gears from OEMs to your acquisition of the Nielsen Advanced TV Advertising Business (sic) [Nielsen's Advanced Video Advertising]. You were leasing their technology before, so presumably, similar to This Old House, you had a pretty good understanding of what you were getting here. Could you help frame what attracted you to this asset and just the opportunity that you see specifically for dynamic ads on linear TV?

Yes. Yes. You're absolutely right, Cory. So we've worked with Nielsen for a long time in a number of different ways, for everything from we were the first Nielsen DAR partner in streaming, and yes, we were renting this ACR technology. And so yes, for us, it was kind of we were renting and now we bought the ACR technology that is increasingly important to us because the Roku TV footprint has grown nicely. Those ACR features are an opt-in, but there's a great consumer -- a feature called More Ways To Watch, and so we do have high opt-in rates for consumers. So that ACR footprint and data set is very important to some of the differentiated offerings we can gather. Last year, we came out with an audience guarantee that's pretty unique, where if you're an advertiser and you have a combo linear TV ad campaign and streaming, you can have a performance structure with Roku that will -- we guarantee you'll only pay for incremental reach on Roku, right? So if -- we know through our ACR data if somebody's been exposed to that ad on linear TV, and thus, we're not going to serve that ad and you don't have to pay for sort of wasted or overly duplicative ad insertions. And so that's a very cool feature. And you're right, for us, that was about sort of moving from renting that to owning that because it's important to us. And the scale is growing with the Roku footprint. On the DAI side, the digital ad insertion, that is a technology which I think is very interesting. Yes, it's in more in its nascent state, but the ability to either overlay targeted information on a largely untargeted or loosely target -- lightly targeted traditional TV ad is a really powerful thing as well as potentially just fully replacing the untargeted ad with the targeted ad. That certainly takes a lot of work between advertisers, the underlying content publisher. And so that -- I think that will take a long -- a while longer to really become a big force, but I'm very encouraged. The technology is very cool, and it adds a lot of value to advertisers. So certainly, having that technology in-house is important for us. I mean in general, if you look at the ad stack capabilities we've been continuing to innovate on the ad tech side, whether it's with the Nielsen AVA purchase, some of the features we've built in-house. We obviously bought dataxu a year-plus ago and rebranded kind of the core assets there as OneView. And having that in-house ad platform and DSP capabilities, combined with the reach of Roku and the proprietary data set, has been usually successful to date. So more to come on that, but it certainly adds our core to our value proposition and our monetization.

I'm going to ask one question on competition. I think by pretty much any measure, Roku and Amazon, clearly the 2 leaders in terms of Smart TV platforms in the U.S., but there are certainly others making a push and making more noise recently. I mean I think, and we were surprised, I think when Google said they had 80 million Google TVs. I forget the exact stat a few days ago. And then you have the likes of Comcast and even Walmart kind of seeming to get into the debate. So my question is, just curious, any real changes in your view on the competitive front, probably more U.S. speaking.

Yes. It's certainly competitive. But I think what a lot of people don't -- who don't know the history here, we were not the first licensed operating system out in the market. Actually, Android TV predated the Roku OS in the licensed TV format. So if you look at the market share trends over time, we've competed very successfully, right? We've gone from 0 market share to 38% in the U.S. Android has -- its market share has kind of bounced around a little bit, but certainly, they have not made anywhere close to the progress. That stat you quoted, I think, is a bit apples to oranges. So I'll just be -- folks should just be careful of understanding what that stat is and what it's not. But I think in terms of the U.S., yes, we have -- we certainly, whether it's in the Smart TV realm or players or on the platform side, we battle with big competitors. But I think our best defense is a good offense, and that's what we've been doing for a long time, which is continuing to innovate. I mean we -- that's all we do is streaming TV, right? So the A team on Roku or all of the folks at Roku, that's just what they're doing, right, versus a lot of these other places have competing priorities. And a lot of times, they're sort of focused on something, then they're not. And so, for us, I feel really good about stacking up the fact that, on the TV side, it's cheaper to build a Roku, it's got more content, we've got great retailer relationships, and we've been actually building a ton of market share. And so I think that speaks for itself.

Last question, I'm getting our 2-minute warning. And you just finished your strongest growth quarter, I think, in company history or at least as a public company. So growing triple digits, integrating 3, 3 fairly recent acquisitions of modest, modest size. What do you see -- what keeps you up at night? What are the biggest execution risks? What worries you could derail things here going forward?

Yes, certainly never a dull moment in streaming land and at Roku, in particular, because, yes, the growth rates are amazing. I mean one of the things I'm most proud about is, I think when I started at Roku, Roku was growing at 20% year-over-year revenue growth, and I thought that was pretty awesome. And our gross margin was in the 20s. And now we're -- that last quarter was 79% revenue growth on a much bigger number, and the gross margin is in the mid- to upper 40s. In terms of -- I do worry a lot. I mean I'm a CFO. I spend a lot of time sort of working across the organization. So aside from the financials and a lot of the strategic topics we talk about, I do spend a lot of time thinking about -- and we've got other folks in the organization just working on scalability and efficiency. And so the scalability, when you're growing this fast, is very, very important, and there's a lot of work behind the scenes on scaling up infrastructure, moving to processes that are automatable and scalable. And those are big factors. And then the other piece we talked about earlier, international, I spent a lot of time on international expansion operations when I was at Expedia, and so there is a lot of work that has to be done as you become a more global company. And so yes, that is something we're very focused on. That's kind of like if you think about the 4 key investment areas that we talked about, those are outward-facing. Kind of the fifth one internally is the scalability. So we spend a lot of time working on that, and that's very important to continue to not only drive the growth properly, but then also make sure we're becoming more efficient as we scale up and that the value of the scale kind of hits down to the bottom line of the P&L.

Awesome. Well, Steve, I really appreciate you coming to the conference this year. We're out of time, so we'll leave it there. But thank you.

Yes. Thanks, Cory. Have a good day, everyone.