Good afternoon and welcome to the Aterian, Inc. 2022 Fourth Quarter and Full Year Earnings Conference Call. Please note, this event is being recorded. I'd now like to turn the conference over to Ilya Grozovsky, Vice President of Investor Relations and Corporate Development. Please go ahead.

Thank you for joining us today to discuss Aterian's fourth quarter and full Year earnings results. On today's call are Yaniv Sarig, Co-Founder and CEO; and Arturo Rodriguez, our Chief Financial Officer. A copy of today's press release is available on the Investor Relations section of Aterian's website at aterian.io. I would like to remind you that certain statements we will make in this presentation are forward-looking statements and these forward-looking statements reflect Aterian's judgment and analysis only as of today and actual results may differ materially from current expectations based on a number of factors affecting Aterian's business. Accordingly, you should not place undue reliance on these forward-looking statements. For a more thorough discussion of the risks and uncertainties associated with the forward-looking statements to be made in this conference call and webcast, we refer you to the disclaimer regarding forward-looking statements that is included in our fourth quarter and full year earnings release as well as our filings with the SEC. We do not undertake any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. In addition, the company may refer to certain non-GAAP metrics on this call. Explanation of these metrics can be found in the earnings release filed earlier today. With that, I will turn the call over to Yaniv.

Thank you, Ilya, and thanks everyone on the call. Today, I'm going to go over the following topics. I'll start with a quick introduction of Aterian, for those who are newer to our story, I'll then review key takeaways from our fourth quarter of last year, and I'll discuss our goals for 2023. Lastly, I'll address the long-term prospects for Aterian and share why we believe in our vision for the consumer product platform in the future. For those who are new to the story, here's what you need to know about our company. Aterian is part of a new breed of technology-enabled consumer product companies. We focus on building, acquiring and partnering with e-commerce brands online. Aterian owns and operates several consumer brands selling products across various categories on channels such as Amazon, Walmart, Shopify and eBay, both domestically and internationally. To allow us to scale, we've invested in building our own proprietary platform called AIMEE. AIMEE enables our team to manage our business more efficiently by injecting technology into processes that would otherwise have to be executed manually and would require hiring an unsustainable workforce. Through its ability to analyze vast amounts of data and automate daily recurring tasks, AIMEE allows our team to find new product opportunities we can launch under our brands, manage these products at scale effectively across various channels, automate certain marketing and fulfillment tasks, and much more. Our goal in the long term is to become one of the most efficient consumer companies in the world, expanding our footprint globally while continuing to invest in technology and an agile supply chain to drive scale and profitability. I'll now take a few moments to speak about our Q4 results as well as our goals for 2023. As we shared previously, our goal was, first and foremost, to discount and sell through high-cost inventory. As a reminder, due to the shipping container costs skyrocketing in 2021 and 2022, consumer brands across our industry were forced to ship goods at an average cost of $70,000 per container to stay in business. These additional costs forced us to increase our product prices by an average of 20%, only to generate an average contribution margin of 8%, with some of our products seeing as low as a 6% contribution margin versus our target of 15% at a normal price. As we saw the cost of shipping finally coming down, we took advantage of Q4 last year and the demand generated by the holidays to discount our inventory to cycle through our existing goods so that we can replenish inventory at a lower cost basis, benefiting from pre-pandemic shipping rates. What we're seeing now is an average cost of container closer to $4,000 per container. While our adjusted EBITDA took a hit, the decision to liquidate the long inventory now puts us on track to get back to a stronger contribution margin starting in Q1 and Q2 of this year, leading to our guidance of turning adjusted EBITDA profitable in the second half of 2023. This decision was also critical to preserve the competitive advantage of our product and avoid being undercut by competitors who would benefit from the lower shipping rates. It's important to understand that our discounting and inventory liquidation efforts do not reflect a weak portfolio. In fact, some of our best products were part of these strategic efforts, all to make room for inventory at a lower cost basis. I'm happy to report our overall inventory position has been reduced from $76 million back when we started our normalization efforts in June of last year to $43 million in Q4. The risky inventory has improved by $3 million, and we expect additional normalization to happen in Q1 with another $3 million to $4 million of inventory cycling through. This cash generation improves our balance sheet heading into 2023. Our entire team feels now that Aterian has overcome a very difficult period. Putting aside the remaining inventory normalization we need to accomplish in Q1, we can finally look to pursue growth and profitability again. The energy and motivation we have is drawn from the relief and satisfaction of navigating complex challenges, but also from a continued belief in our vision. So what does the road ahead look like? I want to outline some of our goals in the next few months and explain how they tie into our vision. First and foremost, in line with the Q4 efforts, we are laser-focused on achieving adjusted EBITDA profitability in the second half of the year for our core business. This effort is primarily based on getting our cost basis of products back to pre-pandemic levels and executing well on our marketing strategies. Separately, many of our competitors have not been able to navigate out of the difficult macro-level environment, and we're in the process of assessing several significant M&A opportunities to acquire assets from other Amazon aggregators. This is an ongoing effort, and while we cannot guarantee results, we're very optimistic about our ability to capture substantial amounts of additional contribution margin that will accelerate our path to profitability in 2024. Finally, we're looking to launch new products, and while we have already over 20 new products being developed, we're also looking to take our model a step further by developing more differentiated and unique products. While we don't expect to become a hardware company, we believe that insights from our data-driven approach can provide the opportunity to work closely with manufacturers to design more advanced differentiated features through a bootstrap approach. We're also very focused on continuing our international expansion. Recently, we made great progress with our European expansion, and our goal is to be optimally positioned with our existing portfolio in Europe in 2024. Following this, I want to speak briefly about the long-term prospects for Aterian. We launched this company back in 2014 because we believe that e-commerce adoption will grow steadily year-on-year, and marketplaces will dominate the lion's share of GMV globally. We were accurate in that prediction and focused on building a company that can manage and scale brands and products with a marketplace doctrine. According to research, third-party sales through online marketplaces will account for 59% of all global commerce by 2027. We realized at inception that marketplaces would allow retailers to delegate a lot of their work to the brands that use them, making it difficult for those brands to scale. Just to look at the composition of sellers on Amazon tells a remarkable story. While Amazon does not publish this figure, industry estimates suggest that third-party sellers on its marketplace generate approximately $390 billion in GMV. Of the 1 million plus active sellers, industry estimates indicate massive fragmentation, with only 60,000 sellers surpassing the $1 million a year revenue threshold and approximately 50 businesses crossing the $100 million mark. Marketplaces have removed the barriers of entry that existed in traditional brick-and-mortar retail, allowing almost anyone to sell their products to hundreds of millions of buyers, but this comes at a price. Brands must manage all aspects of their business themselves, including forecasting, inventory, pricing and discounts, and marketing. This is where technology comes in. We have always believed since inception that the only way to scale a consumer company on marketplaces was to inject technology into its operations to automate the necessary tasks. Today, we use machine learning to help us reduce the costs of forecasting, media buying, and pricing optimization. Recent exciting developments in AI should be eye-opening for any business leader out there. Aterian is already leveraging large language models to help synthesize sentiment in reviews, and we're looking to extend our use of AI rapidly to further improve our efficiency. Aterian is a consumer product company, not solely an AI company, but I believe we have the DNA, expertise, and culture to leverage technology to achieve a market-leading position in our industry over the long term. In general, I believe the world will see two types of businesses emerging: those that have built internal expertise to harness AI as a powerful force driving efficiency and competitive edge, and those who will be remembered in history as not agile enough to adapt. Aterian does not only wish to be part of the first group; it is already one of the most sophisticated companies when it comes to applying technology to drive the value chain of e-commerce consumer brands. With that, I'll pass it on to Arty.

Thanks, Yaniv, and good day, everyone. Here are the financial performance details of our fourth quarter. For the fourth quarter of 2022, net revenue declined 13.3% to $54.9 million from $63.3 million in the year-ago quarter, primarily due to reduced consumer demand, offset by a strategy of liquidating high-cost inventory. The fourth quarter net revenue of $54.9 million is comprised primarily of $52.3 million of our organic business, a nominal amount of revenue from our most recent acquisition, and $2.6 million of wholesale revenue. The year-ago quarter net revenue of $63.3 million was comprised primarily of $31.3 million of our organic business, $27.6 million of net revenue from our acquisitions, and $4.4 million of wholesale revenue. Our organic revenue increased by $21 million due to the classification of our past acquisition revenue going into organic revenue, our strategy to sell off higher-priced inventory, and normalized inventory levels offset by reduced consumer demand in the period. Our M&A revenue decreased approximately $27 million as all our material acquisitions have been known for over a year, and that revenue has shifted into the organic revenue categorization. Our Q4 acquisition, while nominal from a financial perspective, was strategic and designed to leverage a competitor and drive sales to our other Lean brand, and we're pleased with the progress of this strategy to date. Looking at our fourth quarter net revenue by phase, the $54.9 million broke down as follows: $41.3 million in sustained revenue, $0.1 million in launch, and $13 million in liquidate and inventory normalization. The year-ago quarter net revenues of $63.3 million broke down as follows: $52.7 million in sustained revenue, $0.2 million in launch, and $10.4 million in liquidation and normalization. Our sustained decrease of $12 million relates to renewal shifting into the liquidation phase and general consumer softness. Our liquidation increased by $5 million from our strategic initiative to sell off higher-priced inventory and normalized inventory levels. Finally, on revenue, our launch revenue declined as we previously disclosed, pausing the launch of new products in 2022. The current launch revenues are primarily attributed to new variations of existing products in the quarter. We are currently planning new product introductions for 2023, though the timing will be opportunistic. Overall gross margin for the fourth quarter declined to 37.1% from 45.6% in the year-ago quarter and decreased from 45.5% in Q3 2022, primarily attributed to our strategic initiative to sell off higher-priced inventory and normalized inventory levels. Our overall Q4 2022 contribution margin, as defined in our earnings release, was negative 11.5%, which decreased compared to the prior year's CM at 7.9%, which is directly attributed to higher liquidation revenue from our strategic initiative to sell higher-priced inventory and normalized inventory levels. Our sustained product contribution margin decreased to 8.3% versus 16.1% in Q4 2021 as we also reduced pricing to normalize inventory levels and other management initiatives. We do expect our sustained contribution margin to improve as we progress in 2023. Looking deeper into contribution margin for Q4 2022, our variable sales and distribution expenses as a percentage of revenue increased to 51.6% compared to 40.1% in the year-ago quarter. This increase was primarily due to higher supply chain costs, including last-mile fulfillment and our product mix, including liquidation and normalization of inventory, offset by reduced storage costs. We do expect our sales and distribution expenses as a percentage of net revenue to improve as we progress in 2023. Our operating loss for the quarter was $22.8 million, which includes a reserve for BARDA credit of $1.6 million, $2.7 million of noncash stock compensation, and a noncash loss on goodwill of $0.5 million. Our net loss for the quarter was $20.3 million, which includes a reserve for BARDA credits of $1.6 million, $2.7 million in noncash stock compensation, a noncash loss of goodwill of $0.5 million, and a gain on the fair value of the warrant liability of $2.8 million. Adjusted EBITDA, as defined in our earnings release, for the fourth quarter of 2020 was a loss of $16.2 million compared to a loss of $3 million in the fourth quarter of 2021. Our strategic decision of liquidating higher-cost inventory and normalizing our inventory levels impacted our adjusted EBITDA in the period. However, this was a very important effort leading us to improve our core business and putting us on track to get back to stronger contribution margins in 2023 while strengthening our balance sheet as we head into the new year. Turning to the balance sheet. At December 31, we had cash of approximately $43.6 million compared with $26 million at the end of September 30. The increase in cash is primarily driven by the previously reported $20 million capital raised in early October, positive changes in working capital, offset by our net losses in the period. Our working capital improvement was part of our goal to strengthen the balance sheet, driven by moving out our more expensive long inventory. As of December 31, inventory landed at $43.3 million. We have made great strides in Q3 and Q4 of improving our inventory composition and reducing our overall inventory, as we expect to be completed with this process by mid-Q2 2023. Our credit facility balance landed at $21 million, which is down almost $3 million from the sequential quarter and down almost $12 million from December 31, 2021. As our cash position has improved from capital raises and we continue to normalize into the new year. This reduced balance also resulted in lower interest expense. As we look at Q1 2023, which is typically our lowest revenue quarter, and taking into account the current global environment, we believe net revenue will be between $32 million and $36 million. Our adjusted EBITDA guidance is beginning to show improvement as we progress toward adjusted EBITDA profitability in the second half of the year. For the first quarter of 2023, we expect adjusted EBITDA loss to be in the range of $4.8 million to $5.8 million, anticipating continued impact of inventory liquidation. This Q1 2023 adjusted EBITDA guidance on average shows a 70% improvement from our Q4 2022 reported adjusted EBITDA and a 40% improvement from Q3 2022 adjusted EBITDA, as we begin to see results from our strategic efforts in liquidating high-cost inventory and normalizing inventory levels. In closing, 2022 was a challenging year, but we have persevered through global supply chain disruptions and challenging macroeconomic conditions. We have significantly reduced our inventory by moving on high-cost inventory and normalizing our inventory levels, which we believe puts us in a position to achieve adjusted EBITDA profitability in the second half of 2023. We have also strengthened our balance sheet in 2022, which gives us flexibility to navigate the current macroeconomic environment as it continues to unfold and allows us to remain focused on driving our core business. We are excited and proud of the company we are building. Aterian continues to have a very strong brand, and many of our products can be some of the best sellers on Amazon. We continue to have industry-leading technology and logistics, and most importantly, our dedicated and hard-working people continue to do extraordinary work. As such, we are highly confident and optimistic about Aterian's future.

Our first question will come from Alex Fuhrman with Craig-Hallum Capital Group.

Congratulations on what looks like a strong success in clearing some of the inventory that you'd been hoping to. I was wondering if you could talk about which categories you've seen the most demand for both during Q4 and now that we've got a couple of months of 2023 under your belt, where you're seeing the most demand? And is that informing where you're looking for M&A? Or are you really looking at all different categories for that?

Alex, Yaniv here. I'll take that question. Good question. Overall, as we mentioned, consumer demand is a bit softer, right? But because of all the efforts we've done on liquidation, we've had more success across pretty much the board when it comes to the categories as typical with the seasonality of Q4 versus Q1, Q2, and Q3. There's not a big difference there. I'd say in response to your second question, we want to diversify our portfolio a little bit. If possible, right, M&A is more opportunistic. But as much as possible from a supply chain perspective, we're leaning towards consumer product companies making their goods not necessarily in Asia but perhaps in the U.S., Eastern Europe, or South America. But of course, we're looking at all opportunities.

Okay, that's really helpful. And then can you give us a little bit more color on the bridge of how you get from what you just reported and what you're guiding to in Q1 to being adjusted EBITDA positive in the second half of the year? It looks like what you're guiding to for profitability in Q1 is better than expected, at least a much smaller than expected loss. How do you walk us from that in Q1 to being positive in the second half of the year? Is it primarily gross margin as you start to sell through inventory that wasn't brought in at high container rates?

Yes. I'll let Arty add to that. Go ahead, Arty.

Yes, no, Alex, I think you nailed it right at the end. As we said previously, it takes a couple of quarters to get rid of this really expensive inventory that we brought in strategically before late 2021, but we had to take the impact, unfortunately and pay those container rates. As the inventories move through, you're going to get back to a place where you can get to target-type contribution margins. With that, we should drive profitability. Obviously, consumer spending is always a question mark, but we feel confident that once we move through this expensive inventory, especially that which is starting to arrive in April and May for Q3, we will see seasonal sales at better margins. That's why we're increasingly confident in what we're seeing.

Our next question will come from Brian Kinstlinger with Alliance Global Partners.

Sorry, I joined late. If you covered this in your prepared remarks, could you update us on how many new SKUs were released in the fourth quarter, how many you expect in the first quarter, and possibly some rough full-year figures? You may not have the exact number, but how is the weak consumer spending environment affecting the pace of SKU launches?

Brian, just to clarify, we're starting to launch products, but as you know, that process takes time. My comment was on the fact that we have over 20 products that are in development and will be launched, some this year, some next year. I think the impact you'll see is that we'll continue to develop and launch products this year, though much of it will be felt in 2024. The main reason we paused launching products was because of the unreliability of supply chains, both in terms of timely arrivals and the unpredictable fluctuations in shipping costs. We paused due to these issues. Now that we're finally seeing stability in the supply chain regarding both the price of shipping and reliability, we feel confident in resuming product launches. Most of the impact on these launches will be felt in the second half of this year and primarily in 2024.

Okay. And so were there any releases in the first or fourth quarter and expected in the first quarter? Or are they all in process right now?

So if there were any in the fourth quarter, they would have been product variations, meaning another version of an existing product. That's where we would have felt more comfortable. It’s not as material as when we typically do the launches you may be thinking of. And again, with the efforts we're putting on now, we'll be able to provide a little more clarity soon on the timeline of those launches.

And then as I've read, especially in the private market, there are some undercapitalized fulfilled-by-Amazon companies that are struggling. Are you beginning to see any fire sales and how aggressive will you be this year in 2023 on M&A?

Yes, it's a great question, and you're absolutely correct. There's a lot of companies out there struggling and going through challenges similar to what we faced in the last year and a half. Some are in a difficult situation. We're actively engaging with many of these competitors, exploring different opportunities, and spending considerable time on this. As mentioned in my earlier remarks, we cannot guarantee outcomes, but we are optimistic about our ability to find valuable opportunities among distressed assets. Many of these challenges have affected strong assets, creating potential for successful acquisitions. We are quite active in discussing opportunities with these companies, and we're hopeful to share exciting news soon, but it remains a work in progress.

Last question from me is when you first went public, there was a pronounced seasonality to your business. Help us understand today how to think about seasonality for the year in different quarters.

Yes. The big difference from when we first IPOed until now is that Q4 has become a much stronger quarter, which has the potential to perform even better over time in a normalized environment. Q1 still lags behind, but it's really about the composition of our current portfolio. Q2 and Q3 remain the strongest quarters, followed closely by Q4, with Q1 lagging behind the three when compared to back when we IPOed.

Our next question will come from Marvin Fong with BTIG.

I guess my first question, just on the first quarter revenue outlook, down maybe something like 20% year-over-year. Just wondering if you could help us understand how much of that is the consumer demand softness that you alluded to, or is any of it just that you're entering the quarter with a little bit less inventory than you were in the same quarter last year? I wanted to understand that dynamic a little better.

Yes. Let me start and see if Arty wants to add anything. But in general, Marvin, one of the benefits of running our business with different brands across various categories is that we have more visibility on demand. As you mentioned, the main factor driving this downturn is the softness in consumer demand. That's evident, given the overall economic outlook. However, we still see positive signs as we're looking at demand through the lens of the entire category. We have good visibility that we're not losing market share but rather experiencing a general decline in demand across the board. Arty, do you want to add anything?

Yes, that's right, Yaniv. We're seeing soft consumer demand early this year, but we still feel confident for the year ahead. I believe we pointed out in the past that overall revenue would remain mostly flat. We are seeing some consumer demand softness early in the year, but we expect it to pick up for Q3 and Q4. The other part of this, Marvin, is that even at a lower revenue level, you can see the improvement in adjusted EBITDA guidance, which highlights our focus on clearing out high-cost inventory, ultimately setting us up for a more solid 2023.

Yes. You’ve touched on my next question, which was your reiteration of reaching EBITDA breakeven in the second half of the year. You feel good that even if the consumer remains weak or gets weaker, you've stress-tested your plans, and you're still confident about that?

Yes. You're right. The overall consumer softness is evident across the board. However, our experience in certain categories and positioning gives us comfort moving forward. The main factor here is the cost base of products. The contribution margin expansion we anticipate is due to the efforts we made in Q4 to clear out inventory at a lower cost basis. Additionally, our logistics team has secured a significant amount of inventory needed for the second half at a reduced cost, which also instills confidence in our estimates. There were numerous challenges over the past year, including issues related to shipping prices and product availability. Now we feel confident in our projections due to our ability to secure better positions for inventory.

Got you. And my last question, perhaps a more fun topic: you mentioned utilizing ChatGPT and OpenAI. I'm also curious; I believe you’ve always employed some form of AI to analyze reviews and guide business decisions. Can you elaborate on what capabilities you're developing now or expect to achieve in the near future with these new large language models that you couldn't previously?

Yes, absolutely. We use machine learning and automation across many aspects of our business. If you want to categorize it, there are two main areas: understanding consumer sentiment and managing the complexity of data needed for product management. This includes forecasting, media buying, and pricing— areas where we apply automation. As for ChatGPT and large language models, the excitement around this is significant. We are using models like ChatGPT to enhance our existing sentiment analysis on reviews. However, the crucial aspect to emphasize is that the most challenging part of AI is having quality data. Many organizations, especially in the consumer product space, struggle to implement data-driven systems. Aterian has invested in technology and developed systems that enable us to leverage AI effectively. With advancements in large language models, we expect to see widespread disruption across various business functions in the coming years. Only companies that have prepared their data effectively will reap the benefits. Thanks to our efforts, we are well-situated to take advantage of this technology and enhance efficiency across function lines. We’re very excited about these developments and what they could mean for us moving forward.

Our next question will come from Matt Koranda with ROTH MKM.

It's Mike Zabran on for Matt. So the recent heavy discounting makes a lot of sense even on more premium products, but could you provide visibility on when we can expect a halt or reduction in the level of discounting? To what extent is pulling back on that heavy discounting factored into the half EBITDA profitability expectation?

Arty, I'll let you take that?

Yes, of course. As you follow discounting and pricing on Amazon, it's a bit dynamic, right? The aim here is that if we clear out all the expensive inventory and normalize, we can restock at normal costs, which are now back to pre-pandemic rates for shipping containers. Based on our current view, as we enter the second half, we should see normalized pricing, leading us to better contribution margins. We expect to see significant improvements in Q3 and Q4, which are crucial to our goals. We could potentially see some normalization start as early as Q2, but we can't certainly pin that down. So currently, we’re really emphasizing the second half.

So we should expect to see normal levels of competitive discounting in the second half of the year, but the first half will still involve discounting to clear the excess inventory. Am I understanding that correctly?

Yes, that's correct. You should see normal pricing positions as we enter the second half, absolutely.

Got it. Just one more question from me. How are we circumventing the Amazon SBA fees? I understand you have 3PL sites and FDA at your disposal, but could you clarify how we optimize between using Amazon versus 3PL sites to get products to customers?

That’s a great question. We have invested significantly in building a network of 3PLs connected to our AIMEE platform. Our logistics team has devised strategies to effectively utilize these 3PLs, allowing us to fulfill larger items ourselves while smaller items typically get fulfilled through Amazon. The logistics team strategically stores items in our 3PLs before sending them to Amazon to optimize our distribution. The objective is to place storage close to Amazon warehouses. This reduces both our dependency on Amazon's FBA inventory and our costs, ultimately improving margins and delivery efficiency.

It appears there are no further questions. This concludes your question-and-answer session. I would like to turn the conference back over to Ilya Grozovsky for any closing remarks.

Thanks. As part of our shareholder perks program, investors can sign up for our participants who have the ability to ask management questions on our earnings calls. I want to thank all of the shareholder perks participants for their loyalty, participation in the program, and their questions. I have picked a few of the most popular questions this quarter that they've sent in. So here they are. The first question is when do you intend to be fully operational in Europe and do you plan to cover more European countries in the future?

Thanks, Ilya. We're excited about our European initiatives. Supply chain crises prevented earlier moves, but as noted previously, we have good infrastructure in place in key markets. Our focus isn't on expanding into more countries just yet; it's about maximizing our presence in existing important markets. We’re aiming to enhance the volume of our current portfolio in Europe this year, with lower supply chain issues giving us the opportunity to maximize these efforts, which will importantly impact our outlook for 2024. Once these initiatives succeed, we may consider expanding further but that’s not the immediate plan.

Great. The next question is, when do you expect to clear inventory purchased during Covid and start benefiting from the lower shipping costs?

As already indicated, we have made considerable progress in reducing our inventory, down from about $76 million in June to $43 million currently. We still have some long inventory that we intend to clear out by the end of Q2 at the latest. Our target is to minimize long inventory to less than 5%, which seems achievable based on our Q4 progress and continued efforts in Q1.

Great. Okay. And the last question was, what was the health and wellness brand that you acquired in October of 2022? And how will that come to market?

Yes, there was significant interest in this acquisition. We acquired a small competitor to our Square brand, which was directly competing and undercutting our prices. We jumped at the opportunity because we wanted to control the listing and prevent undercutting. This was a long-term investment; if this competitor had continued to invest in their business, they could have posed challenges to our brand over time. We took advantage of the situation to eliminate that long-term risk.

Great, this concludes the Q&A portion of the call. In terms of upcoming calendar, Aterian management will be participating in the 35th Annual ROTH Conference from March 12 through 14 in Laguna Niguel, California. We look forward to speaking with you on future calls. This ends our call, and you may now disconnect. Thank you.

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