SONO - NASDAQ

Thank you for standing by. My name is Kayla, and I will be your conference operator today. At this time, I'd like to welcome everyone to the 60-minute Sonos Fourth Quarter and Fiscal 2025 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to James Baglanis, Head of Corporate Finance. You may begin.

Good morning, and welcome to Sonos' Fourth Quarter and Fiscal 2025 Earnings Conference Call. I am James Baglanis, and with me today are Sonos CEO, Tom Conrad; CFO, Saori Casey; and Chief Legal and Business Development Officer, Eddie Lazarus. Before I hand it over to Tom, I would like to remind everyone that today's discussion will include forward-looking statements regarding future events and our future financial performance. These statements reflect our views as of today only and should not be considered as representing our views of any subsequent date. These statements are also subject to material risks and uncertainties that could cause actual results to differ materially from the expectations reflected in the forward-looking statements. A discussion of these risk factors is fully detailed under the caption Risk Factors in our filings with the SEC. During this call, we will also refer to certain non-GAAP financial measures. For information regarding our non-GAAP financials and a reconciliation of GAAP to non-GAAP measures, please refer to today's press release regarding our fourth quarter and fiscal 2025 results posted to the Investor Relations portion of our website. As a reminder, the press release, supplemental earnings presentation, including our guidance and conference call transcript will be available on our Investor Relations website, investors.sonos.com. I will now turn the call over to Tom.

Good morning, everyone, and thank you for joining us today. Q4 brings a strong close to fiscal 2025 for Sonos. In Q4, we grew revenues 13% year-over-year and posted strong positive adjusted EBITDA. 2025 was, without question, a transitional year for the company, but I'm proud of all we accomplished. We restored the quality of our software and now can speak confidently about the new capabilities we're delivering across the Sonos experience. We drove efficiencies and financial discipline into every aspect of our operations. We reorganized the way that we work in product and engineering. And as a result, today, we are executing with greater urgency, focus and effectiveness. Over the course of the last 3 quarters, you've also seen the work we're doing to rebuild our senior leadership team. And today, I'm thrilled to announce another important step on this front. In January, Colleen DeCourcy will join Sonos as our new Chief Marketing Officer. Colleen is one of the most celebrated creative leaders of her generation, bringing extraordinary taste, cultural insight and a proven ability to connect creativity with business growth. She joined us following a successful tenure at Snap, where she served as Head of Marketing and Chief Creative Officer and before that, as Co-President and Chief Creative Officer at Wieden+Kennedy. All of this progress creates a strong foundation of excellence from which to return to growth and expand profitability, but there is more to do. The company doesn't just need more discipline, better execution and a revitalized team. We need a new strategy. Over the last several years, Sonos has produced excellent products. But in thinking about what hardware to make, what software experiences to deliver and how to bring those offerings effectively to market, we've lost focus on what makes us different and better. And what's more, we've lacked an organizing theory of the case. I'm changing that, and I'd like to tell you a bit more about the details today. While others sell fragments, a sound bar for the TV, headphones for the commute, Bluetooth for the beach, Sonos is every dimension and sound for the home, music, movies, stories, rooms, formats, conversations and control, all connected into a single, cohesive and radically easy system. The pursuit of this system is now our organizing lens for decisions and the foundation of our durable advantage. The Sonos system is independent by design and is the premier platform to connect first- and third-party experiences with incredible audio. It's why today, Spotify, Apple Music, YouTube Music, Amazon Music and over 100 others all thrive on Sonos. It's also why we bring together Bluetooth, AirPlay, Spotify Connect and analog sources alongside formats like Dolby Atmos and Lossless Audio to uniquely deliver every dimension of sound. With our installed base of over 53 million smart Internet-connected devices and more than 17 million homes and growing every day, the Sonos platform is the trusted place where services old and new work side by side, giving households freedom of choice anchored in a system that they love. Casting into the future, we see a world where live natural conversations with AI personalities are as commonplace as smartphones are today. And we believe Sonos' expertise in Internet-connected, voice-enabled personal hardware products for the home can position us as the center of these interactions. Starting now, our future hardware and software road maps are single-mindedly directed at leveraging our position in the home to deliver bold experiences, both traditional and entirely new that will make Sonos even more relevant and beloved in the eyes of our customers. From a financial perspective, this strategy is underpinned by a compounding model built on generating new households and increasing lifetime value. Generating new households means bringing more homes into the Sonos ecosystem, growing our installed base through great gateway products, sharper marketing that tells our story more forcefully and continued international expansion. Increasing lifetime value is about deepening our relationship within every household. That starts with engagement, delivering products that become an essential part of everyday life and then encouraging people to grow their Sonos systems over time, whether that's adding more rooms, headphones or building out a comprehensive home theater experience. At the end of fiscal 2025, the average Sonos household grew their system to 3.13 products and multiproduct households increased to an average of 4.49, still well below what we believe a fully realized Sonos home can become. But lifetime value isn't just about how many products someone owns, it's about the horizon over which they're investing in their Sonos systems. We want households to keep upgrading, expanding and discovering new ways to enjoy Sonos for decades. We'll do that by keeping system fresh through reliable software, excellent service and product updates that inspire people to reinvest in Sonos. As one example of the power of this compounding model, we see a $5 billion revenue opportunity in driving devices per multiproduct household higher to 6 per home and another $7 billion in converting single product households to current multiproduct levels. Taken together, this alone is a $12 billion opportunity just within our existing base. Our opportunity is to write the next great chapter for Sonos. For the last many years, we were just selling speakers and experimenting with new categories. Today, we're building a cohesive system that compounds in value, stronger as it grows, smarter as it evolves and more essential over time. We hold just 6% of the $24 billion global premium audio market. There is no reason we cannot garner a much larger share of this market while we simultaneously grow the sound system category that we invented. While our strategy will take time to fully manifest in our hardware portfolio, including the delivery of entirely new products for use cases and spaces in the home that we do not occupy today, we enter fiscal 2026 with an incredible portfolio of products that we are bringing into tight alignment with the strategy through software updates. We'll further strengthen the family with new hardware products launching in the second half of the year, and we'll continue to sharpen our brand storytelling, expand internationally, drive excellence in our installer channel and partner selectively to reach new audiences. As we turn this page, we also continue to execute effectively and with discipline. We've reduced our operating expense run rate by more than $100 million while selectively investing in the opportunities where our conviction is highest. We've kept margins healthy even while navigating tariffs. We've grown adjusted EBITDA despite top line challenges. We've invested in innovation to unlock future growth while returning capital to shareholders through buybacks. And we've deepened our relationships with our channel and installer partners. What drives all of this is the world we're building for our customers, a home that comes alive with sound and experiences that move seamlessly between moments, moods and spaces where every product, software component and interaction works together and the whole becomes much greater than the sum of its parts. I've said before that Sonos is one of the few companies in the world with the ingredients to build beloved consumer products at the very highest level. As we enter fiscal 2026, I've never been more certain of our ability to do this. I see it in the passion of our team in the way customers respond when we make their systems better and in the discipline with which we've reshaped the company around our core strengths. Great things lie ahead. Now let me turn things over to Saori.

Thank you, Tom. Hi, everyone. We closed out fiscal 2025 on a high note as we delivered strong Q4 financial results. Revenue of $288 million was near the high end of our guidance range, driven by solid demand. On a year-over-year basis, revenue grew 13% versus our guidance of up 2% to 14%. We saw strong double-digit growth in EMEA and our growth markets more than doubled in Q4. Our growth markets contributed more than 1/4 of our overall Q4 growth rate. On a product basis, we also achieved strong double-digit growth in home theater and plug-ins. Q4 GAAP gross margin was 43.7% and non-GAAP gross margin was 45.1%, both at the high end of our guidance range. Compared to last year's Q4, gross margin improved nearly 340 basis points on a GAAP basis and more than 400 basis points on a non-GAAP basis, driven by comp over onetime hits in prior year from inventory reserves to app recovery-related costs, in addition to cost savings and leverage, partly offset by impact of tariffs this year. Q4 GAAP operating expenses were $160 million, down 7% year-over-year. Non-GAAP operating expenses of $135 million were down 6% year-over-year. On a normalized basis, primarily for variable compensation, non-GAAP operating expenses declined by 19% due to cost optimization efforts we had set out in August of last year. Adjusted EBITDA was positive $6 million, which was $4 million above the midpoint of our guidance range. This is a $29 million improvement year-over-year due to higher revenue, better gross margin and lower operating expenses. Our balance sheet remains strong as our net cash balance ended the quarter at $228 million, which includes $53 million of marketable securities as we hold some excess cash in short duration treasury bills. We also have an undrawn revolving credit facilities at our disposal, which we just extended for another 5 years. Q4 cash flow was negative $2 million, up from negative $54 million last year, primarily due to higher cash earnings. CapEx was $5 million, down from $16 million last year. Our period-end inventory balance declined 26% year-over-year to $171 million as we comp over last year's inventory build ahead of launch of Arc Ultra and Sub 4 and work down of component inventory. Our inventory consists of $153 million of finished goods and $18 million of components. As I said in the past, returning capital to shareholders remain a key pillar of our capital allocation framework. Accordingly, we spent $20 million of share repurchases in Q4 at an average price of $13.39, reducing our share count by 1.3%. For fiscal 2025, as a whole, we spent $81 million to repurchase 5.7 million shares at an average price of $14.23. We have $130 million remaining on our current share repurchase authorization. In addition to keeping our share count in check through regular share repurchases, we're managing dilution through the actions that we took to reorganize and reduce layers of senior management, which has resulted in our annualized stock-based compensation expense decreasing from $101 million in Q1 to $68 million in Q4. For the full year, our revenue was $1.44 billion. While our overall revenue declined 5% year-over-year, we saw strong double-digit growth in our growth markets, which contributed almost 1 percentage point of growth rate to total revenue. We also saw growth in home theater, which helped us gain further share in U.S. premium home theater for the third year in a row, where we retained our #1 position. We also improved our share in EMEA, where we hold the #2 position in premium home theater. In fiscal 2025, we grew our installed base 5% to 17.1 million households. Devices per average household grew to 3.13, up 2% from the prior year. We also saw growth in devices per multiproduct household, which improved to 4.49, up 2% year-over-year. Consistent with past years, our existing households accounted for 45% of product registrations. GAAP gross margin came in at 43.7%. Non-GAAP gross margin of 45.2% was down just 60 basis points year-over-year despite price decrease on key products and tariffs due to cost savings efforts and product mix. Our GAAP and non-GAAP operating expenses declined by 8% and 10%, respectively, on a reported basis and 16% and 17% on a normalized basis. Adjusted EBITDA increased 23% year-over-year to $132 million, driving 210 basis points of margin improvement to 9.2%. This is a direct result of our transformation efforts over the past 5 quarters, which have resulted in Sonos becoming a leaner and more focused organization with sharper financial discipline. As we continue our transformation journey and gain operating leverage through top line growth, we expect to increase our margin over time. Non-GAAP earnings per share grew 31% to $0.64 due to lower operating expenses and reduced diluted share count. Lastly, free cash flow was $108 million, down from $135 million in fiscal 2024 due to $35 million of nonrecurring items this year. Excluding these nonrecurring items, which included $24 million of cash restructuring payments and $11 million of tax payments for intercompany transfer of IP, fiscal 2025 cash flow would have been $144 million, up [ $9 billion ] or 7% year-over-year. Turning to our guidance. The Q1 outlook we're providing today reflects the trends that we have observed quarter-to-date as well as our expectation of demand in the holidays. We expect Q1 revenue to be in the range of $510 million to $560 million, down minus 7% to up 2% year-over-year. Growth in underlying demand should be slightly positive at the midpoint, better than the year-over-year change in revenue as we comp over launch and channel fill of Arc Ultra and Sub 4 in Q1 of last year. Looking beyond Q1, we expect improving year-over-year comparison with new product launches concentrated in the second half of fiscal 2026. We expect Q1 GAAP gross margin to be in the range of 44% to 46% with non-GAAP gross margin approximately 110 basis points higher than GAAP. This represents a year-over-year increase of more than 100 basis points increase at the midpoint for both figures. This guidance comprehends the impact of tariffs and pricing changes. Please note that we expect our Q1 gross margin to benefit from the following 2 factors: one, leverage from holiday sales volume; and two, a lower effective tariff rates, thanks to our seasonal inventory build in Q4. We expect our effective tariff rate to step up and stabilize in Q2, representing a further 100 basis point headwind versus Q1. We expect Q1 GAAP operating expenses to be in the range of $152 million to $162 million, down 19% at midpoint from last year, with non-GAAP operating expenses to be lower than GAAP by approximately $16 million. Please note that our operating expenses will vary quarter-by-quarter in part due to timing of product launches and associated expenses. Bringing it all together, we expect Q1 adjusted EBITDA to be in the range of $94 million to $137 million, representing year-over-year growth of 27% and a margin of approximately 22% at midpoint of roughly 500 basis points of margin expansion. When I first outlined our transformation journey in August of 2024, we committed to improving efficiency, regaining profitability and investing in long-term growth. In fiscal 2025, we executed on this pivotal work, growing adjusted EBITDA by 23% and non-GAAP EPS by 31%. Our results reflect the progress we've made in becoming a leaner and more nimble organization. Furthermore, we evolved our pricing strategy with an eye towards growing households and increasing lifetime value. I want to thank the entire Sonos team for their commitment and resilience in executing and adapting to many changes this past year as we navigate this journey. It is important to note that this critical improvement in our profitability did not come at the expense of future growth. Though we have significantly reduced our operating expenses, we have grown our investments in enhancing our core software experience, expanding our global footprint and investing in our people. We'll remain disciplined as we focus on returning to durable top line growth, balancing continued profitability improvements with reinvesting efficiency gains and advancing our pricing framework in alignment with our corporate strategy to strengthen our platform, attract new households and increasing customer lifetime value. With only a small fraction of the global market captured so far, our view is that there is a vast opportunity in front of us. After the call, we will upload our new investor presentation to our IR website, which has been updated to reflect the strategy Tom described earlier in the call as well as our fiscal 2025 results in our Q1 guidance. With that, I'd like to turn the call over for questions.

[Operator Instructions] Our first question comes from the line of Steven Frankel with Rosenblatt.

Tom, you've laid out an interesting new description of your strategy. And I'd like to drill down just a little bit. To date, you relied on third parties like Alexa for bringing intelligence to the product. Are you talking about maybe trying to bring some of those capabilities in-house when you're describing AI interactions with your products?

I think you'll see us be a platform for both third-party AI experiences as well as our own first-party experiences in the same way that in the past, we hosted Alexa and Google Assistant and our own Sonos Voice experience. So I think there's tons of opportunity in both of those lanes for us.

Okay. And then in terms of the holiday season, could you give us some insights into your promotional posture for holidays and what you expect your competitors to be doing at this point?

Steven, it's Saori. Thanks for the question about the holidays. Clearly, the holiday -- the peak of the holidays are still ahead of us and with some of the tariff-related activities, mitigation factors that we've put in place. We're monitoring that. And so far, those are coming in as expected. And so that's comprehended in our guidance that we provided on the call. We're continuing to see demand track so far. And so as we go into the holidays, we have some of the usual activities that we're contemplating, but combined with some of the, again, the tariff mitigation activities that we have contemplated. And so we are monitoring how those play out.

And should we expect you to -- given your desire to improve the products per household and get upgrades going, extend a lot more efforts going forward in the installed base through e-mail marketing and promotions to the installed base as opposed to advertising, marketing promotions in the channel in general?

Yes. One of the things I mentioned on the call or referenced was the pricing strategy that we're now starting to take, which is in alignment with the strategy that Tom described on the call, which is exactly to improve the household acquisitions, but the quality household that will provide the repurchase cycle. And so the pricing strategy that we have started to reorient ourselves in the spring when we, in particular, reduced the pricing of the Era 100 speaks to product selectively that we're taking on the pricing where we'll bring in the quality household with the tendency for the future repurchases and maximizing our lifetime value from our customers.

I was just going to add. I think it's important to remember that there's really kind of these 2 levers in the model. The first is growing households. And so part of growing households is going to be about doing a better job of telling a sort of full funnel marketing message from driving awareness for the Sonos system to gaining consideration among consumers and then driving to purchase for new households. We'll do that through better gateway products, more compelling experiences, better differentiation and stronger marketing. And then as you point out, there's real opportunity for us around better engaging with our existing customer base to drive expanded lifetime value, and we'll do that through both the current product portfolio, marketed better and through entirely new products that will drive new use cases in the home for our customers.

Your next question comes from the line of Erik Woodring with Morgan Stanley.

Tom, I think it's really exciting that you can lay out this new strategy for Sonos. And I just wanted to ask you about it. Again, I guess I'm putting words in your mouth here, but it sounds a little bit like you're attempting to become more of a broad-based smart home platform because obviously, to date, the differentiating Sonos value prop has been the system of connected sound devices that you've provided. So when you say a cohesive system that compounds in value, can you maybe just give us a little bit more granular understanding of exactly what that means and maybe some of the adjacencies that you're referencing? And then I have a quick follow-up, please.

Sure. I'd like to start by kind of contrasting what we're doing under this new strategy to where we've most recently been. I think for the last -- maybe as many as 7 or 8 years, the company has been very focused on building great individual products, best-in-class sound bar, a best-in-class pair of noise canceling headphones, a best-in-class portable speaker. And the execution of the company from product to marketing has really reflected that category approach. And what we're doing with this strategy is going to seem at some level familiar because in a way, it is a return to form. Sonos started as a connected system, not just this kind of loose collection of products. And so thematically, we are going back to our roots. But I think what has changed in the last decade is the scale of what system can mean today. Early Sonos really just connected a few rooms together to play music in sync and frankly, at the founding, not even from the Internet, from a collection of MP3 files that sat on a hard drive in your home. Fast forward 20 years, the canvas is just far, far bigger. We have hundreds of services, formats, traditional voice control and this whole new explosion of AI personalities that I think can all come together in the home. And so yes, we are evaluating the opportunity for ambience in the home and entertainment in the home outside of just audio and video and film. But I think better to think about like the entirety of the canvas of what the consumer experience can be in the home and what the Sonos platform with our 17 million homes, more than 53 million Internet-connected voice-enabled devices already in the field, what that platform can become in this sort of new era.

Okay. I got you. That makes sense. I'm looking forward to hearing more about that as we keep going. And then say, can you maybe help us better understand how you guys are absorbing what I think are relatively outsized tariff costs? Like if I just say 60% of your business is in the U.S. and the average tariff rate in the areas where you produce your devices is, call it, roughly 20%. That's a pretty sizable tariff headwind. We're talking like several tens of millions of tariff -- incremental tariff costs. So at the same time, I think you're trying to open your funnel a bit with certain pricing actions. So just can you help bring it all together and help us understand, obviously, a very strong 1Q profitability guide even before we get to the OpEx dynamics. How are you absorbing all of these costs?

Erik, I'm going to jump in here because I'm just so proud of how the company has reacted to this unexpected headwind that sort of fell in our lap in April. And it's taken a real kind of not just cross-functional effort inside of Sonos, but in our entire ecosystem of working with our partners to get to the mediation of these tariffs that we've been described in Saori's remarks. But just to put some numbers to it, so you can think about it. In Q1, we're looking at about 300 basis points of margin impact due to tariffs at their sort of current blended rate. Virtually all of that impact has been mitigated by our actions. And so what are those actions? Those are pricing, those are how we're using promotion. That's all the work we've done with our channel partners to share the burden of these costs. So great progress for Q1. Now looking forward to Q2, the blended rate -- the tariff rate stays the same, call it, about 20% on the products that we make in Malaysia and Vietnam that come to the United States. But as the sort of blended effective rate fully sort of lands in Q2, we see that margin impact in total, it was 300 basis points become about 400 basis points. And so our mitigations sort of are already fully landed. They're going to land at about that 300 basis points place. So in the end, fully realized, we'll see about 100 basis points of margin impact across the whole business due to the tariffs. Again, this is just one of those things, those curve balls that you tackle in a company like ours. I'm just really, really proud of all of the hard work that the team has done. And frankly, also how well it's all landing in the market because, of course, going into it, there's a lot of modeling that you do, a bunch of analysis, particularly around the elastic response to things like price changes. And I think the team has done just a great job of predicting where the market would be. And so far, we're seeing that our estimates are really playing out in the real world.

Well, okay. That is awesome. That is very impressive. And maybe just the last one, and this is kind of open-ended for you, Tom, is you characterized 2025 as a transitional year. How are you characterizing 2026 today? And then that's it for me.

Thanks. I mean I really feel like it's a whole new chapter. I mean last time we were together on the call, I had just been named the CEO and described that when you're an interim CEO, particularly under the circumstances that I came into Sonos, you're focused kind of on the immediate horizon. And we did a lot of work to sort of transition the company in 2025. And I really feel like we're turning the page on a new chapter for the company now. We're looking much farther out on the horizon. I'm so excited about Colleen joining us to breathe new creative energy and execution into our marketing organization. We've delivered a strategy that brings the entire company together around the Sonos system. And we're beginning to execute on the road map that will land first a whole set of new experiences powered by software and to land new messaging in our marketing that will tell the world about what we intend to be and the services that we can provide in their homes. And then in time, of course, you'll see new hardware expression of the strategy come to market as well. And it's just -- I mean, honestly, it's just sort of a delight to get to be focused on the next chapter of Sonos and to feel like the transition is now behind us.

And your next question comes from the line of Brent Thill with Jefferies.

Just to follow up on the heels of that question. Just when you think about being in the C5 months, I know you've had a playbook, but as you kind of put it, you're now the full-time coach. So on this new playbook that you're unveiling, maybe if you can give us just a hint of how you think about the biggest areas of improvement and the action plans to achieve those improvement plans.

I'm an engineer and builder by background. And when you face a new sort of opportunity, product definition, the first work that you do is sort of decompose it into its constituent parts and begin to execute. And so much of what we've been doing is that work of decomposition of building the right team, improving our operating discipline, setting out a clear strategy to the team, setting a financial model that we know will drive growth and then doing the work of defining what are the product executions that deliver on the strategy. And so for my part, I'm just -- I'm excited about doing that decomposition and getting to work on the constituent pieces with the entirety of the company behind me. And I'm just -- again, I'll just reiterate my enthusiasm for where I think we can be in time.

I guess the question we get is how much change needs to happen in your mind for you to get and achieve this? Is this a fine-tune? Or is this more of a drastic overhaul?

I think we're really building from a place of strength here. We have tens of millions of Internet connected voice-enabled devices of the highest quality in 17 million homes. We've got a software platform that was designed from the ground up for both third and first-party services to express themselves. We have best-in-class sound and microphone technology. We now have an incredible world-class marketing leader at the helm of our marketing organization. And I think at the end of the day, in most cases, setting the strategy is a tiny fraction of the work, and it's just about execution after that. And so now we're really just in execute mode.

Just to add to that, Brent, this is Saori. Some of the other activities that we've already have started reoriented, as Tom called 2025, the transition year that we're looking forward to advancing is things like the pricing strategy that we started to implement in the middle of FY '25 that we're starting to see some of the fruit of that. And with Tom's new strategy that's being more clearly articulated, we're really aligning that sort of the portfolio view of how we look at our products and how we price and how we expect the margin of those products with a lifetime value of the customer in mind as well. And so that's another aspect of how we're approaching the company differently than in the past that we can speak to. And this is all in addition to some of the OpEx cost optimizations that we've been doing, the transformation work that we've been doing that has taken, as Tom said, over $100 million, and there are more efficiencies that we're working on that we're really actively looking to where to best invest for the future growth of the company. So there's many aspects of how we operate are different than in the past that I wanted to just add to the point that Tom is making.

Yes, that's great. Just while we have you, just when you mentioned EMEA was strong in the quarter, maybe just double-click into what you're seeing in EMEA.

Yes. No, aside from some of our execution, we are seeing also some parts of EMEA market also doing as well. But certainly, we've seen EMEA respond well to some of these pricing changes that we've made in the middle of the year and products like Arc Ultra, that's more of a global speak, has done really well at the home theater space. They've continued to gain share in the space. And so both between the innovation of the products that we have and the pricing strategy and how we're approaching some of these markets that have been relatively depressed in the last couple of years. EMEA had been hit even harder than U.S. in the past years. And so we're starting -- we're really excited to see some of the recoveries that we're seeing in those markets. In addition, as we also mentioned, we're looking at some of the geographic expansions as well. And so there are some markets that we focused on that are also starting to fruit.

[Operator Instructions] And there are no further questions at this time. Tom Conrad, I'll turn the call back over to you.

Thank you. Just as we close, I want to come back just for a second to the heart of our strategy. At the center of everything we're working on is the Sonos system. One connected experience that gets better with every product, update and household we add and most importantly, where the whole is far greater than the sum of its parts. It's a pretty simple idea with enormous potential, and I'm so excited about where we're headed. I also want to thank the team for the hard work that brought us here, our partners for the incredible teamwork they've shown us this year and our investors for believing in me and where the company is headed. So thank you so much for joining us today, and we look forward to talking to you next quarter.