QNST - NASDAQ

Good day, and welcome to QuinStreet's Fiscal Second Quarter 2024 Financial Results Conference Call. Today's conference is being recorded. Following prepared remarks, there will be a question-and-answer session. At this time, I would like to turn the conference over to Senior Director of Investor Relations and Finance, Robert Amparo. Mr. Amparo, you may begin.

Thank you, operator. And thank you, everyone, for joining us as we report QuinStreet's fiscal second quarter 2024 financial results. Joining me on the call today are Chief Executive Officer, Douglas Valenti; and Chief Financial Officer, Greg Wong. Before we begin, I would like to remind you that the following discussion will contain forward-looking statements. Forward-looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those projected by such statements and are not guarantees of future performance. Factors that may cause results to differ from our forward-looking statements are discussed in our recent SEC filings, including our most recent 8-K filing made today and our most recent 10-Q filing. Forward-looking statements are based on assumptions as of today, and the company undertakes no obligation to update these statements. Today, we will be discussing both GAAP and non-GAAP measures. A reconciliation of GAAP to non-GAAP financial measures is included in today's earnings press release, which is available on our Investor Relations website at investor.quinstreet.com. With that, I will turn the call over to Doug Valenti. Please go ahead, sir.

Thank you, Rob and thank you all for joining us. December was a successful quarter. We met or exceeded our objectives in the quarter and continued recent positive themes, including growing non-insurance businesses at strong rates year-over-year, investing in and making good progress on growth initiatives across the business, and positioning ourselves well for the re-ramp of auto insurance client spending. All that while delivering solidly positive adjusted EBITDA and maintaining our strong balance sheet. I am particularly proud of those accomplishments, given that we were facing the bottom of the insurance cycle, and our toughest seasonal quarter. The significant positive inflection in auto insurance client spending that we expected to begin in January has indeed begun. Auto insurance revenue is expected to be up well over 100% sequentially this quarter versus the December quarter. Auto insurance client spending increases are broad-based and consumer shopping traffic online for auto insurance is also up as consumers react to the compound rate increases of the past few years. Auto insurance clients have indicated that the steep ramp of spending is likely to continue. Accordingly, we expect strong sequential total company revenue growth and rapid EBITDA expansion in the current March quarter and further strong sequential total company revenue growth and rapid EBITDA expansion again in the June quarter. The exact slope of the auto insurance ramp is impossible to predict, but the ramp is, of course, highly impactful to our results. Turning to our outlook for the current or March quarter, our fiscal Q3. We expect revenue to be between $160 million and $170 million, representing sequential growth of 35% at the midpoint of the range. We expect adjusted EBITDA to jump to between $7 million and $9 million as we captured the initial immediate impact of operating leverage from the revenue ramp. For fiscal year 2024, which ends in June, we continue to expect company revenue to grow between 5% and 15% over fiscal 2023. Looking ahead to fiscal year 2025, which begins soon in July, while detailed planning is not yet completed, I am already confident that we will expect strong double-digit full year revenue growth over fiscal 2024. Now, before I turn the call over to Greg for more details on our financial results, let me give you my overall view of where we are. We have limited a fierce macroeconomic storm in auto insurance, our biggest vertical. We have maintained positive adjusted EBITDA and a strong balance sheet throughout, thanks to strong capabilities, disciplined execution, and a resilient business model. Our business model and strong financial foundation allowed us to continue to invest in the future during this period despite the conditions in auto insurance. We rapidly scaled two nine-figure non-insurance client verticals and invested aggressively in our capabilities, products, and footprint for future growth. We are now incredibly well-positioned for the near and long-term. Our footprint for growth is large and diversified, representing tens of billions of dollars of addressable markets. We have big growth opportunities in the expansion of our existing client verticals and in exciting new contiguous markets and product areas. Our capabilities and competitive advantages are clear and strong, and we are improving them and expanding our market opportunities at a rate unprecedented in company history or I would argue, in the history of our industry. I have never been more confident or bullish about our prospects from here, especially, of course, as auto insurance continues to adapt, normalize, and re-ramp. With that, I'll turn the call over to Greg.

Thank you, Doug. Hello and thanks to everyone for joining us today. Fiscal Q2 was another solid quarter for QuinStreet. Total revenue was $122.7 million. Adjusted net loss was $2.3 million or $0.04 per share, and adjusted EBITDA was $417,000. Within the quarter, we saw the auto insurance cycle bottom out in November. That being said, we are excited about the significant inflection of auto insurance client spending, which indeed began in January. Looking at revenue by client vertical. Our Financial Services client vertical represented 58% of Q2 revenue and was $71.3 million. Our Home Services client vertical represented 40% of Q2 revenue and grew 15% year-over-year to $49.3 million. Other revenue was the remaining $2 million of Q2 revenue. Turning to the balance sheet, we closed the quarter with $45.5 million of cash and equivalents and no bank debt. Moving to our outlook, for fiscal Q3, our March quarter, we expect revenue to be between $160 million and $170 million and adjusted EBITDA to be between $7 million and $9 million. For full fiscal year 2024, which ends in June, we continue to expect revenue to grow between 5% and 15% over fiscal 2023. In summary, let me reiterate Doug's earlier points. One, over the past few years, we have navigated a generational downturn in our largest vertical and continue to invest in long-term growth initiatives, all while generating positive adjusted EBITDA and maintaining our strong balance sheet throughout that period. Two, we are well-positioned to benefit from the significant positive inflection in auto insurance client spending, which has indeed begun in January. And three, we expect strong sequential revenue growth and rapid adjusted EBITDA expansion in the March quarter and again in the June quarter. With that, I'll turn it over to the operator for Q&A.

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] Your first question comes from John Campbell of Stephens Inc. Your line is already open.

Hey guys. Good afternoon. Congrats on the solid quarter.

Thank you, John.

On the -- so on the guidance, I mean, it's certainly encouraging that it feels like it's the kind of early stages of the insurance recovery. You guys have been kind of bracing for that. So, it's -- glad to hear that it seems like that is kind of starting to arise. It seems like you might be laying off a little bit on the guidance for the next quarter. But if I look at just the back half of the fiscal year guidance, I'm looking for maybe a little bit of color if you can unpack some of those key assumptions mainly on insurance. I think you guys -- the past second half peak you guys saw, I think that was probably FY 2021. So, maybe as a starting point, if you guys could maybe shed some light on the assumptions you're making relative to that past peak, maybe how much further down you're expecting within that guidance?

Yes, John, the -- and you touched on it, the main variable in the range of guidance for the remainder of the year is, of course, the exact slope of the insurance ramp. We don't know exactly what it would look like. What we do have from clients are consistent and broad-based indications of continued steep ramp. Some pretty specific about where they want to get within the next few months, some less specific, but equally bullish and very important, more importantly, from pretty much every auto insurance client we have, which is very different from where we were last year when we had a strong quarter, but it was really kind of one client that was driving that surge. Rather than giving you -- so the numbers are based on the buildup of a range of assumptions based on what they've told us and our own information on what capacity we have in media, what budget we're likely to get from what players and how those are likely to come together. So, as I said, it's impossible to predict precisely because there are too many moving parts. But what I think we tried to say in the prepared remarks is that it's consistently, bullish, consistently a steep ramp, and a lot of good data in there that kind of builds up to the range of outcomes that we have. I would say that we -- if we're going to air therefore, we're likely to be a little bit more conservative in this quarter because we're still earlier in the ramp than we will be next quarter, I guess, is something you noted -- and I would say that, that would be our bias. I'm not suggesting that the guide is -- trying to characterize the guide. I'd suggest given that we're earlier in the ramp, and therefore, there's a little bit less fully known you would expect that to be the case. But as we run a series of scenarios, with a lot of bottoms-up buildups and a lot of input of data from things like media capacity. And we have a much bigger media footprint now, by the way, than we did last time we peaked in auto insurance, as an example. This quarter, we will be nowhere near the past peak of auto insurance revenue as to our guide. Next quarter, the range runs from below that peak that peak a little bit beyond that peak. So, you can see that we're kind of balancing out various symptoms. Does that answer your question?

Yes, that is very helpful. Because I think some of the questions we get is just looking at optically, the growth rate looks pretty substantial for the fiscal 4Q, but I think the message is that getting to that high end of that of your guidance range is not assuming heroics relative to the past peak? Is that fair to characterize?

Absolutely fair. Yes, it's -- by no means in the realm of heroic or anything if you looked at the data and the inputs you go, gosh, you're never going to get the look we're highly confident in our guide for this quarter, which is a $45 million ramp over last quarter at the midpoint. It would -- to get to -- depending on how we do this quarter against that guide, you're talking about another $20 million to $30-ish million at the bottom end of the range. and beyond. So, I don't think it's -- we don't believe it's a road. We think it's in the range of what we would consider realistic reasonable fact-based assumptions.

Okay. All very helpful. And then one last one here, just kind of housekeeping. But on the CapEx, I mean you guys have always kind of operated with light CapEx. I've noticed that, I guess, year-to-date, fiscal year-to-date, CapEx is like double up relative to last year and I think the year prior to that is like 4 times higher. So, it seems like definitely a focused investment happening there. I don't know if you're at a stage now where you can shed some light on that, but I'm curious about what's driving that?

Yes. No, it's a great question, and you're exactly right. We have been accelerating and being very aggressive in our software capitalization, software development, which gets capitalized, of course in the QRP area mainly, driven primarily by demand and by the signing of a couple of very large accounts, and we wanted. And so the combination of that and having made sure the product was fully ready to launch with those big accounts early this calendar year. And anticipating and seeing an increase in demand and activity for that product as the insurance market has come back, drove us to invest at those rates and to those levels. I can tell you that we're pretty much at the end of that cycle and you're going to see that capitalized software development cost drop pretty significantly this quarter forward. That wraps pretty much through the snake, if you will, super excited. I mean, super excited about where that product is, about the intention we're getting, about some of the big accounts we've signed, about the opportunity there, and that will only get better and better. We believe as the insurance market continues to come back, of course, -- that was pretty dormant there for a while because there really weren't enough carriers participating in the market to make it worth the while of the various brokers and agencies to invest and a product like that. But we have seen that turn pretty dramatically over the past couple of months.

Very encouraging to hear. Thanks for the time guys.

Thank you, John.

Your next question comes from Dan Day of B. Riley Securities. Your line is already open.

Yes, thanks for taking the questions guys. Just -- would be good if you could comment from a state level. I know there were a number of big states that have effectively been shut off since April or so of last year. Maybe if you could just comment with what's come back in January. Like are those larger states being turned back on in a meaningful way? Any commentary there would be great.

Sure Dan. You are correct, a lot of big states have been shut down by a number of carriers in some states, pretty much all the carriers. We have seen some re-openings of some major states by major carriers. Of course, it's a map with a lot of different participations by different carriers. So, not all the carriers are opening all the states at the same time. But I can tell you that we have seen some big states reopened by major carriers and by a number of carriers, and we've been told to expect that to continue. And we have gotten indications of some of our major clients that they would expect to be reopened in all major states and back to what they consider to be a normalized demand, which we are nowhere back to yet, by the way, by mid-year -- by mid-calendar year.

Okay, great. Sounds like good news. You guys said in past quarters, you've broken out the growth in the credit-driven vertical specifically. I didn't hear any commentary this quarter. Maybe I missed it, but can you just give us some color on how the personal loans, credit cards, other connection verticals performed and the outlook for the next couple of quarters?

Yes. The -- let's say, well Home Services, you didn't ask about home services, you talk about grew about 15% is our second largest business, our third largest business. And by far, the biggest component of credit-driven verticals is personal loans grew 18%, 18% year-over-year in the quarter. Credit cards was actually down a little bit versus the previous year, but it was just nothing to see there other than a real tough comp. Credit cards gets driven -- peaks and valleys get driven by limited time offers or promotions. And last year, in the December quarter, there were a lot of good promotions in the quarter. This year, there really weren't any new big promotions in the quarter. So, we would expect that to even itself back out as we get -- as promotions start rolling back out this quarter and next quarter. So, -- and those are the big components. So, those are 90-plus percent of the credit-driven.

Okay, great. Appreciate it guys.

Yes, thank you, Dan.

Your next question comes from Mark [Indiscernible] of Lake Street Capital Markets. Your line is already open.

Hi, guys. Thanks for taking my call. So, it looks like you had some strong growth in the Home Services piece, but I was wondering if there was anything you could say around any impact you saw with rising rates and what that may add on Home Services lead generation?

That's a great question, Mark. But nothing that we could discern. We think, generally speaking, in our experience and in talking with our clients that higher rates are having a number of effects. One effect is, of course, you're having consumers stay in their existing home. And that's a good thing because they're going to say, well, I'm going to stay here because I don't want to lose my mortgage. And so I'm going to invest in this home. And so that, I think, continues to be a theme in Home Services. We're trying to make sure that we're participating with our clients in those product and service areas that align with that. Beyond that, you could assume that it may be tougher for consumers to invest in bigger projects because of interest rates if they need to borrow. We haven't seen that in a meaningful way that we know of and we continue to believe that Home Services as a market for us is a double-digit grower on average for as far as yes, I can see, we're super early. It's massive. And it's just a great fit for QuinStreet. So that's kind of -- that's how I would answer the question.

Got you. That’s helpful. Thank you very much. That’s all I have.

Your next question comes from Jim Goss of Barrington Research. Your line is already open.

All right. Thank you. Doug, I think you might have addressed this a little bit with -- in terms of the media footprint and capacity. But I was wondering if you could provide a couple of metrics that you can give us to point to evidence of the inflection point having been reached. Is it volume of inquiries? Are there certain things that we might take away just in terms of how we view that as section having been achieved?

All right. I think the main one is one I mentioned in the prepared remarks, Jim, and that what you're referring to, but we're -- our auto insurance revenue will be up way over 100% this quarter or last quarter. That's inflection. The demand by consumers and traffic by consumers driven by the higher rates and the fact that now you have more options coming to market because of the clients' opening states and increasing their participation, we saw a 30% jump in consumer traffic, shopping online for auto insurance in January over December. And so -- and then if you look we could give you more detail on that just client-by-client, and it's almost every one of our clients in auto insurance is up dramatically versus where they were in the calendar fourth quarter. So, again, I think it's a lot of different metrics and land clients in states but the bottom-line metric is on 120%, 130% growth, something like that quarter-over-quarter, this quarter versus last quarter, and indications and by the way, an accelerating and accelerating. I mean the amount of budget we had in December was -- began -- was meaningfully better than November then we had that surge, I just talked about percentage-wise in January over December. And we've grown -- and that has accelerated in February, where we have significantly more budget in February, and it's if more states in February than we had in January, and we have indications of clients that they -- from almost all of our clients that they want to reach significantly higher levels, including in some very large clients getting to normal footprints, which means pretty much all states on uncapped with us. And today, no or near all states are open and they are capped in terms of their budgets at this point as they control their ramp by June. So, those would be the, I think, the main things that would reflect the rent.

Okay. And I know you mentioned the unpredictability of any of these things these cycles. And no two cycle is going to be exactly the same. But do you have -- does history suggest any degree of sustainability of the rebound? Is it -- does it tend to be a long-running thing? Or do you -- does it happen pretty quickly when it happens as dramatically as it's been happening right now?

It's a good question. When I talk about it being unpredictive audit, I don't mean it's not predictor. I said the exact slope is unpredictable. It's impossible to predict. What I'd say that is predictable that it is sloping and it is ramping and it looks like it's going to be quite steep. The sustainability is, again, a very important and good question, particularly given what we went through a couple of years ago and then last year, I would say here are the indications from us at the sustainability. One of the fundamentals, if you look at the reported combined ratios and/or profitability of the auto insurance carriers over the past couple of quarters, dramatically better, dramatically better and consistently better than they were, last year, the year before and the year before that. So, that's very, very important because first and foremost, their economics have to work. The combined ratios are better dominantly because they've taken rate. I know it's gotten rate increases. They've had three years of compound double-digit rate increases, generally speaking. And that has given -- and also along the way, they've adjusted their footprint and their product to adapt to adapt the economics better. So, it's not just rate, it's also making other adjustments. And as a result of that, we're seeing fundamentally combined ratios and profitability reports very strong from all the major carriers in that you guys have seen that. You will continue, I think, to see that. I'd say the third thing is the breadth of the participation. Last year, in the year before, the surge in the January quarter was very focused and narrowly so on one or a couple of carriers. We are seeing it this time amongst all of our carrier clients. I don't think it's an exact -- I can't think of one that hasn't significantly increased their spend with us, most importantly, but also their outlook for increasing spend going forward with us, and have increased their activity much more broadly and all the other things they're doing, whether it be QRP engagement or participation with agencies or all the other stuff. So, the activity level is higher and the activity level is higher broadly, and I would go so far to say virtually amongst all of them, whereas last year, it was not so. So, that indicates to us -- and by the way, the way to talk about future months is quite specific and bullish, and credible time. So, I'd say that participation is also and the way that participating is also important. Your question about how long it lasts is a great one. If you look back at what they call kind of hard and soft markets, I think they call them an insurance. Typically, the cycles are much, much shorter for the bad markets than we've seen over the past few years. That's why Greg referred to it as generational, I referred to it as a fierce storm -- macroeconomic storm. This has been the worst auto insurance cycle in anyone's memory because it was such a deep, fundamentally hard thing to get out of between the COVID's effect on driving behaviors, but also on inflation and supply chain. And including things like tough used car markets and because there weren't enough new cars to buy. I mean it was a very tangled mess of complexity. They really had a very dramatic effect on insurance carriers and it's taken them a long time to untangle it much longer than usual. Usually, these cycles are more like, I don't know, maybe a year, the down cycle then usually get several good years after that. I am not in an industry -- at Insurance industry analyst, but I think if you read the analysts that follow the industry, their view is likely to be that this is -- we're likely at the beginning of a multiyear positive cycle because of all the carriers have gone through on the product side, on the footprint side and now all the rate increases they've had. So, we're subject to big weather events, which are really short cycles. I think we're -- we feel like and the clients seem to be indicated that the outlook is quite positive for as they can see.

Okay. Thank you. One other little myth. Someone mentioned he had heard from an agent that there are certain states unwilling to ensure certain cars because of at risk that have come up in the past couple of years. Are there -- is that -- are you seeing things of that nature or any other were things that would factor in any of the--?

No, it's a good question. There are things like that in the market all the time. But nothing that fundamentally affects the trajectory, not that we would expect to fundamentally affect the trajectory now. But there's a lot of -- I mean they're a big neighbor because of California nobody would cover home insurance, of course, they are big parts of -- I mean, there's lots and lots of stuff like that, but the overall trend of the market from here appears to be up and to the right.

All right. Thanks a lot. Appreciate it.

Thank you, Jim.

Your next question comes from Jason Kreyer of Craig-Hallum. Your line is already open.

Great. Thank you. Doug, just wanted to see if you could give us more color on the dialogue you're getting from carriers. I know in past cycles, the resurgence of spend has been kind of driven by digital first carriers with more of the captive agencies, a little bit behind them? Are you seeing that play out now? Or are you seeing a little bit more increased spend out of both buckets?

More out of both, actually. We reviewed the auto insurance market and business with the Board recently at the last Board meeting and one of the slides showed how much more diverse the footprint was for us and by implications in terms of overall industry demand than it was last year for this quarter. and pretty dramatically so, I would note. So, we are seeing it more broad-based than we have seen in past cycles. I think that's generally the case. But I think it's also specific to us because we do have a bigger footprint now than we did last cycle. We have a broad -- we participate much more broadly in in other parts of the digital landscape, we used to be dominantly clicks now we have clicks, calls, leads, services like QRP, things like that. So -- but we appear to be seeing it and again, this is anecdotal, but we appear to be seeing it more broadly in answer to your question.

That's great. So, as the re-ramp continues to build, I'm just curious what you think your prospects are for taking market share over the next several months?

I think it's good. We have not lost a share on the media side. In fact, we've significantly gained share on the media side through this period. We've recently signed very big player in media that we're going to be adding to that already win cycle as we launch that in the next month and a half or two months. And I don't -- nobody has been able to invest in the products that expand the market and expand our footprint in that market like we have through this period because we had the wherewithal to do so. We didn't have debt. We did have -- we had positive cash flow we have or positive operating cash flow case adjusted EBITDA, if you will. And most of the other players in the market had debt and/or we're much more deeply tied to the auto insurance cycle or how do the problems like mortgage and just did not have the capacity to do what we've been able to do in terms of aggressive investment through the cycle. And we've invested in are things that we expect have and we'll continue to build not just to grow the channel and grow our footprint in gene also take share. We've gained share, we think we'll continue to do that.

Just one more, if you don't mind. You teased out some data or just some statements earlier on QRP. I know you don't want to break out numbers or contribution. I'm just curious maybe how big you -- like rate of change, how big that can become? Or at any specific point in time or you think that can be a bigger contribution and more meaningful to your fundamentals?

Yes, it's a good question. We've only invested in that product because we do think it's going to be very big for us. We think tens of millions of dollars is exactly what it ought to be and it could be bigger than that, particularly if you look at the side effects of it and the combination of it with other ways to service the channel. So, we think it's many tens of millions of dollars in opportunity. We think it's a market that's over $100 million in the addressable market. over time, we don't expect we'll get 100% of that market. That's why I say maybe tens of millions of dollars. But we do think we're way ahead of anybody else in terms of the product and where you go with this product. it will ramp with a little bit of a lag to the overall market coming back because you have the market coming back and marketing spend and clients participating and then you have the agencies revving up because now they have participation in product and now they're willing to invest in and work on projects like QRP, which allows them to be more efficient, more productive in the market than they would be -- they can be without it. . So, I think it will lag, but we clearly see a ramp. We expect quite a significant ramp this year to -- when I say this year, I mean the remainder of this calendar year and next fiscal year, we would expect to ramp back up. We're already running at seven figures, but low we would expect that to be mid to high seven figures certainly next fiscal year and the fiscal year after that. I'm hoping that we can get well beyond that and start reaching for the eight-figure number. So, it's meaningful and that revenue is very, very high to contributing, right? It's not a normal 30%. Incremental revenue in QRP is generally going to be about 80% to 85% as you get to just a little bit more scale. So, we think it's highly accretive big market opportunity. We don't -- we haven't -- we'll probably have an Investor Day here in the next -- as long as the Insurance ramp keeps going like we expect it to, I would expect we'll have an Investor Day in the next six to 12 months where we will get in more detail about QRP and where we are with that, we'll introduce maybe a couple of the big client programs that we now have running by the way, either one of which could be well into the seven figures and beyond all of themselves. So, these are signed contracts, signed clients. So, we're -- we like it a lot. It's still coming. It was certainly delayed by everything else that was delayed in auto insurance, but we have seen a lot of resurgence of activity and have had a lot of success with big signings recently that are in the launch and ramp stages over the next few months, and we'll be talking more and more about it as we move ahead. And we'll start breaking it out at some point in the future, I imagine, but we're going to get back on our feet and start trotting again with it before we do that.

Got it. Thanks for all the color Doug. I appreciate it.

Thank you, Jason.

Your next question comes from Chris Sakai of Singular Research. Your line is already open.

Hi, good afternoon Doug and Greg. Just a question on Q4. It seems like a lot of growth is being put on to Q4. What are the chances do you see auto insurance not ramping as fast as you want to get to this Q4 -- these Q4 numbers?

I'd say that we have that in the range, Chris. I think we have -- we said 5% to 15% for the year covers a lot of territory at our scale. So, we would -- we think there's -- certainly means we think there's a chance we won't get to the high end. I think there's a chance we will do better than the low end, but we're -- we like to ramp, as I said earlier, this quarter over last quarter, we're representing about a $45 million ramp over -- in terms of sequential growth. The bottom end of the range, I think beyond that represents another $20-ish million or so depending on where we land in the range $20 million to $25 million, I guess, been where we land in the range on top of that sequentially. So, we're not -- we're actually reflecting at the bottom end of the range, a slowing of the sequential ramp. But even though we're seeing right now an acceleration of the ramp in auto insurance. So, again, as I said earlier, I think the -- we still think we're going to end up in that range. The exact point where we end up in that range is going to be pretty dependent on the slope of the auto insurance re-ramp. And while it's deep, it's hard for us to predict precisely the slope and so that's really kind of reflected in what you're seeing. But I'd say that's how I would characterize it. And again, it's mostly driven by the auto insurance ramp. But of course, we've still got a lot of great initiatives and growth and momentum in Home Services, which is the $200-and-something million in your business and first loan, which is a $100-and-something-million business and credit cards as we see more promotions in the market is likely to benefit from those. So, the footprint all in all, but again, I'd say that where we end up in the ramp is going to be dependent mostly on exactly how that -- what that slope looks like without insurance. But we don't think the top end is crazy. We don't think -- and we think the bottom end is something we're pretty comfortable with.

Do you -- in a strategic way, do you -- have you thought about trying to diversify away from this auto insurance these swings in auto insurance?

No, I mean we will diversify -- we have diversified, right? We have -- beginning of this auto insurance cycle, I don't think I don't know, home services, Greg, is it more than doubled through this period.

You're probably right.

And personal loans has probably doubled through this period. So, we've taken -- we've pretty dramatically increased our footprint and diversified through this cycle because we found great new market opportunities that are great with QuinStreet, we didn't do that to diversify away from auto insurance. Auto insurance, we believe, is a great market for us forever. It's a great market. We have phenomenal capabilities. We have a great media footprint. We have the best products and services in the market. We have very close relationships with the great clients that are the best players in that industry. Auto insurance is going to be driven by marketing for as long as any of us are going to be watching it because of the nature of their business model, which is rates are controlled by regulatory authorities. And so if you're going to grow shareholder value over time, you're likely going to have to grow that by gaining market share. rather than by expanding margin or pricing because your margin and pricing are controlled regulated at the end of the day by -- I'll overstate this for 50 state insurance commissioners basically. So, hey, we structurally we love it. It's a big market. We have a great position in it. We're going to keep doing it. We think we'll grow it to many times at current size with the initiatives we have in place to continue to do that and we will grow other client verticals too. And we think that our footprint in Home -- we think Home Services is our biggest addressable market, significantly bigger than auto insurance over time and we've shown we can scale that. We're going to keep doing that. We think personal loans is as big or bigger depending on how you define the lending market where we've shown we can scale that. We will continue to show we can scale that over time. We love our position there. And we like the other credit-driven businesses and credit cards and banking, which are earlier stage. But combined now, we're approaching $100 million a year. in revenue, and I think we will soon eclipse that to just those two together. So, we have a good footprint is diversified. It will include auto insurance and a lot of expansion of products and services around auto insurance and home insurance, everything else going forward.

Okay. Thanks.

Thank you.