Earnings Call Transcript - IBKR Q4 2021

Operator, Operator

Thank you for standing by, and welcome to the Interactive Brokers Group Fourth Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. Please be advised that today's conference may be recorded. I would now like to hand the call over to your host, Director of Investor Relations, Nancy Stuebe. Please go ahead.

Nancy Stuebe, Director of Investor Relations

Thank you. Good afternoon, and thank you for joining us for our fourth quarter 2021 earnings call. Once again, Thomas is on the call but asked me to present his comments on the business. He will handle the Q&A. As a reminder, today's call may include forward-looking statements, which represent the Company's belief regarding future events, which by their nature, are not certain and are outside of the Company's control. Our actual results and financial condition may differ possibly materially from what is indicated in these forward-looking statements. We ask that you refer to the disclaimers in our press release. You should also review a description of risk factors contained in our financial statements filed with the SEC. 2021 was a good year for Interactive Brokers. Adjusted revenues were $2.78 billion, up 26% for the year, and expenses were well controlled, resulting in a pretax profit margin that improved from 61% to 67%, by far the highest in the industry. Adjusted diluted earnings per share for the year were $3.37, and that was 35% higher than the previous year. We look back at 2021 as one with unprecedented global investor engagement with the market. The only better year we can see is 2022. Let me explain why. In 2021, we added more customers, over 600,000; and did more trades, over 2.5 million DARTs per day, than we ever have before. We introduced more products and more tools while also expanding many existing ones, and to assist with our continuing growth, we hired and trained nearly 450 new employees around the world. Our year-on-year account growth was 56% this year. I've been saying for some time that after this unusually active period we have been experiencing, a period that seems to keep growing longer, we will see account growth closer to between 30% and 40% a year. But that does not mean that we will not do almost anything we can think of to try to keep it above those levels. We introduced more new products and expanded the capabilities of existing ones. Recognizing our global customer reach, we introduced global analyst, which allows our clients to discover undervalued companies from a wide database of global stocks. We introduced our crypto offering. U.S. individuals, RIAs, hedge funds, and introducing brokers as well as individuals in over 100 different countries can now all trade crypto through our partner, Paxos. Very shortly, we will be offering crypto for our international financial advisers, iBrokers, and hedge funds in those countries, and we will add more countries continually. We charged just 0.12% to 0.18% of trade value with a minimum of $1.75 per trade. We rolled out our ESG-focused impact app, which brings transparency and a streamlined, simplified platform to help clients find and invest in companies that share their values. Impact also allows them to make cash donations to thousands of different U.S. charities directly from the app. We also introduced U.S. spot gold trading and these are just a few of the items we have been working on, and we have other exciting products and improvements in various stages in advance of being rolled out. As 2021 drew to a close, IBKR was able to produce its second-best quarter of the year after the hyperactive meme stock events of the first quarter. But the story of the meme stocks will fade in the minds of investors, while the most remarkable story of the year, the huge rise in popularity of options, and more specifically, option spreads will remain. As someone who has spent the last 50 years trying to automate the options industry, I very much welcome this development. For a long time, Interactive Brokers was alone trying to stir up industry interest to computerize these markets. But now finally, people are beginning to understand what fantastic, versatile instruments options are. I am predicting further growth, especially internationally. Option spreads give traders the opportunity to assume very specific and limited risk-reward profiles for specific periods of time. Please visit our probability lab on the IBKR website for a fun way to think about, learn about, and play with options. As the year wore on, listed options saw an average daily volume of nearly 40 million contracts, and Interactive Brokers customers were responsible for roughly 10% of daily options volume. This is even more than equities, where we are only about 7%. Execution quality is most important for options traders, especially for options spread traders, where profits and losses tend to be limited, and every penny matters. Even the minimum price difference of $0.01 amounts to $1 a contract, and bid-offer spreads in the market regularly get as wide as $0.05 to $0.10. Interactive Brokers does not accept payment for order flow for IBKR Pro customer orders. We auction off each option order among 16 top market makers. We are always happy to welcome more to this group. These auctions last roughly 100 milliseconds, and the winner chooses which exchange it wants to use to trade with the order. IBKR then posts the order for an exchange auction. If nobody improves on the agreed-upon price, the original winner of the auction trades the contract at that price. This may sound like a rather involved process, but in practice, it all happens in a fraction of a second. All participants use automated processes, and they automatically feed the amount of price improvement they are interested in competing on for any specific option contracts they trade at that specific point in time. In this way, our customers can take advantage of a leading-edge system designed to get them the best available price. Having been the largest market maker in options for over 30 years, IBKR is very well versed in these processes, many of which we have retained from our Market Maker Day, and we have been keeping them up to date over the years. As new exchanges and new rules are continuously introduced, this is not an easy task, and we have a team of programmers regularly engaged in this activity. Imagine if payments for order flow were prohibited, and all brokers were forced to execute their own customer orders. Sophisticated mechanisms like the ones we developed and use would be expensive and take a long time for others to create. While the idea is interesting to think about, I do not believe that it is about to happen anytime soon. Another notable development for IBKR in 2021 was a 40% increase in margin loans over the course of the year. I think this growth will also continue into the future. With 7% inflation in the background, stock prices will have to rise by 7% just to retain relative value. I believe inflation will continue at a high rate. There is very little the Fed can do about it. They may raise interest rates to 1% or 2%. We would not borrow at that rate and invest in leveraged assets. Even if the Fed Funds rate rises to 3%, Interactive Brokers will end at 3.75% to people who want to buy stock, whether or not they combine it with option strategies. The 3% is not likely. A slightly over 3% interest rate would add $1 trillion to annual U.S. debt service and to deficit spending, which would just further increase inflationary pressures. Inflation is here to stay. We'll have to learn to live with it, and margin lending will continue to grow along with it. We aim to grow our businesses by growing our customer base. We will continue to introduce new platforms, products, and research and trading tools to attract new customers of the type that fit our target market: serious, hard-working, and educated investors who come to us to succeed with the help of our execution quality and products and services. With that, I will turn the call over to our CFO, Paul Brody.

Paul Brody, CFO

Thank you, Nancy, and welcome, everyone, to our IBKR fourth quarter results. Starting with our revenue items on Page 3 of the release. We're pleased with the record results during the June quarter; we believe the robust growth of customer positions us well for our transactional revenue. Conditions continue to be strong, returning our second highest ever quarterly revenues driven by investment activities. We've got substantially higher trading volumes, stock and options, which have come from our large customer base. Net interest income was strong, generating $295 million of revenue, also our second highest quarterly performance, leading to a record full year net interest income of 32%. Margin lending remained strong. Investor confidence in the market remains high. Throughout the year, we generated $58 million of revenue and other fees and services, totaling $215 million for the year, which is a 25% increase despite the midyear challenges. Strong client activity drove revenues higher. Market data revenues reached $20 million, up 15% year-over-year, due to exposure growth over the past year. Other income includes gains and losses on our investments, along with transaction-related activities. Many of these non-core items are excluded from our adjusted earnings. Without those items, other income would be $10 million for the quarter and $54 million for the year. Turning to expenses, execution, clearing, and distribution costs were down, even with these costs including $53 million from deposit, which was down 20% from a year ago quarter and down 19% for the full year. As a percent of traditional revenue. Execution and clearing costs driven by trading declined to 22% in 2020, then 13% in 2021. Our customers continue to benefit from the execution fee reductions achieved by our strategic improvements. We continue to focus on expense discipline, while improving our strong top line. Our head count at year-end was 2,571. G&A expenses were up 27% from the year ago quarter, though down 25% for the full year, reflecting lower legal expenses on litigation, partially offset by higher spending on advertising and required fees. Our P&L remained robust as well. Our adjusted pretax margin also remained strong at 66%, while we focused on hiring and investing in the business for accelerated growth. Moving to our balance sheet, our total assets ended the year at $109 billion, with growth driven by margin lending to customers. We have no long-term debt. We opened two offices in Europe in response to Brexit to increase our footprint. For those in our other rapidly growing international locations, our capital base provides the foundation needed for today's operations and for future growth. Our capital base is significant for growth and investment opportunities worldwide. Now briefly looking at our operating data, our contract and share volumes for all customers rose 46% in options, well above industry growth, and 19% in futures. In terms of account growth, we added over 600,000 net new accounts for the year. Total accounts reached 1.68 million, up 56% over the prior year and 9% over the prior quarter. Customer DARTs reached their second highest quarterly level at over 2.4 million trades per day, reflecting investor confidence in rising markets. Our cleared IBKR Pro customers paid $2.38, 3% less per order than they did last year. Profitability per order to us remains the same. Finally, we estimate the impact of the increase in U.S. interest rates, which we expect to generate additional revenue in the coming year. In conclusion, we had a strong quarter to close out a record year, reflecting our ability to grow our customer base and product set, as well as the attractiveness of our strategy to automate growth while minimizing our costs. With that, I'll turn it back over to the moderator, and we will field some questions.

Operator, Operator

Our first question comes from Rich Repetto of Piper Sandler. Your line is open.

Richard Repetto, Analyst

Sorry. Good evening, Thomas. Good evening, Paul. Can you hear me now?

Paul Brody, CFO

Yes, we can.

Richard Repetto, Analyst

Okay. So the stock shares traded quarter-to-quarter were down. I know, only 3% year-over-year but I think it was 32% quarter-to-quarter. I suspect that was a lot of low-priced stock trading in 3Q. But could you sort of verify that, Thomas? And also...

Thomas Peterffy, CEO

Okay. You're absolutely right. Many years ago, we put in a commission limit so that we would never charge more than 50 basis points on a stock trade. And that slowly brought more and more low-priced stock traders to us. Eventually, it appears that there are some regulatory concerns about the stock trading, and we have successfully reduced it. It's got no income impact whatsoever; those are very tiny numbers.

Richard Repetto, Analyst

Got it. Understood. Okay. Paul, you mentioned this question earlier, but there are three rate hikes in 2022 already factored in and three more expected in 2023. The question is, you indicated that the second rate hike would be similar, but I thought you mentioned it might be slightly lower. Can you provide some insight into the additional hikes, considering there could be four to six ahead?

Paul Brody, CFO

Yes. Sure. So the way we model it, the one hike was an increase of an expected $165 million for the year. We would model two hikes. And by that, I mean, over the first two quarters, and then it remains there, each 25 basis points. That should add about another $120 million annually. Three hikes in consecutive quarters would add about another $45 million. And so you have to understand the dynamic here is that with two hikes, Fed funds would be around 57 or 58, let's say, basis points. We start to pay interest to our customers at Fed funds less 50 basis points, whereas right now, that number is zero. So therefore, after three hikes, we then ratchet up our rates that we pay along with Fed funds. The same thing happens on margin lending. So then we have a built-in spread, which is what we always used to have before rates dissolve down to close to zero. So that's why incrementally it benefits us, but less and less. And of course, this is keeping all other things equal, meaning the current balances in margin lending and deposits and so forth.

Richard Repetto, Analyst

Okay. The amounts I have are $165 million for the first, $120 million for the second, and then $45 million for the third.

Paul Brody, CFO

Yes, those are just estimates, but yes. Each one is incremental to the previous, yes.

Richard Repetto, Analyst

And beyond three, incrementally 45 as well?

Paul Brody, CFO

We haven't modeled it, so don't hold me to it, but it would be a number, no more than that. It depends on where the deposits fall in terms of the tiers. Are they small accounts, medium-sized accounts, or large accounts? That will dictate what happens as the rates change. Some are more sensitive to interest rate changes than others.

Richard Repetto, Analyst

Got it. Thank you very much, Paul.

Operator, Operator

Thank you. Our next question comes from the line of Will Nance of Goldman Sachs. Your question please.

Will Nance, Analyst

Hey, guys. Good afternoon. Maybe I can start with a question on the growth. I think last quarter, you talked a little bit about some of the introducing broker accounts that were on a fully disclosed basis, and we're going to move over to an omnibus structure. I was just wondering if that impacted some of the numbers recently and some of the metrics you have put out? And if you could just put a number of ballpark, how many have moved over and how much are left?

Thomas Peterffy, CEO

Yes. I think in December, an introducing broker moved to Omnibus with 2,800 accounts.

Will Nance, Analyst

Got it. Appreciate it. That's super helpful. And then I appreciate all the color on Richard's questions around interest rate sensitivity. Just you mentioned that that didn't contemplate any changes in the reinvestment strategy. I was wondering if you could talk kind of more theoretically about what kind of steepness in the yield curve would you guys look to before you would be more – before you would consider taking a little bit more duration risk in the segregated cash portfolio, are we anywhere near where that's something you've been thinking about? Or is that still far away?

Thomas Peterffy, CEO

No, we did not. I'm extremely worried about much higher interest rates, not because the Fed will move it there, but people will realize that they have to borrow money and leverage in order to keep up with inflation. And so I think that the Fed will lose control.

Will Nance, Analyst

Got it. I appreciate you taking my questions today.

Operator, Operator

Thank you. Our next question comes from Dan Fannon of Jefferies. Please go ahead.

Dan Fannon, Analyst

Thanks. Could you elaborate on your confidence regarding options activity and its sustainability or potential for growth? You mentioned that you believe it will continue. Is it possible that the customer profile using it is different from others in your space, or do you think education or other factors contribute to your confidence in its sustainability?

Thomas Peterffy, CEO

So I think the greatest factor here is that these developments that occur in the United States tend to be followed by other countries with some lag, and that lag is sometimes quite long, like 5, 10 years. So this huge increase in the U.S. recently is certainly going to be followed by customers outside of the U.S. And it is specifically the discovery by more and more people that upstream combined option combination positions can give you very interesting risk profiles and there is more and more of that based on fundamental analysis. So people tend to figure out that the stock could rise between $2 and $5. But not likely more, and this type of forecast can be really harvested in the options market. Then we just see a very big increase in these kinds of trades. As I've said, I expect that to be followed by foreign investors. We are going to be very light beneficiaries of that.

Dan Fannon, Analyst

Okay. That's helpful. Last quarter, when you expressed confidence about account growth and future prospects, you mentioned some new marketing programs and targeted campaigns that contributed to that confidence. Could you elaborate on that, including whether you are increasing funding, reallocating resources, or investing more intellectual effort? Yes. That's where our future lies, and we're pushing that very, very hard. Okay. And from a budget perspective, as we think about 2022 or beyond in terms of the spend, is that something that will be noticeable in the income statement as you spend those dollars?

Thomas Peterffy, CEO

Unfortunately, we are willing to invest any amount that makes sense, but we find it challenging to identify opportunities where we can generate significant revenue. Every time we discover a new channel that performs well for about $1 million, if we double our investment, our return only increases by around 5% or 10%. This is quite frustrating. Therefore, we are continuously searching for new channels and allocating small amounts of money to them, which is what we are currently doing. We are hoping for a breakthrough, but so far, it hasn't occurred.

Operator, Operator

Our next question comes from Craig Siegenthaler of Bank of America. Your question please.

Craig Siegenthaler, Analyst

Thomas, I hope you're doing well. So I want to come back to margin loan balances. I believe there were some pricing adjustments in the quarter, especially on your two highest tiers, $1 million to $50 million and over $50 million. I wanted to see if you could help us quantify any impact from a revenue or earnings standpoint that could drive and when we could see that result.

Paul Brody, CFO

Absolutely. So we talk firstly about the rate rises. But based on the new policy alone, our estimates would add annually about $24 million. Some of that's from putting money into different rate tiers. Some of it is treatment of negative rate currencies. And there's pass-through of some of those costs. But that's our overall estimate.

Craig Siegenthaler, Analyst

I have to ask one on China just because it's been a big source of investor inbound. But can you update us in terms of the Q4 revenue contribution from Mainland China or the two largest introducing broker clients that are there? And then based on the evolving stance from the Chinese government around data and foreign firms, how do you expect the size of these relationships to trend over the next year?

Thomas Peterffy, CEO

So as you know, the two largest customers are Futu and Tiger, and they are leaving us. Futu has practically left us. They had very few accounts still with us. And Tiger is in the process of doing that. As far as the Chinese, yes, I don't have a view on that. I'm very, very confused. Inside the company, we're not in total agreement as to how to attack that. So I can't really tell you. I mean, some of my colleagues are looking more favorably at the Chinese situation than I do.

Operator, Operator

Our next question comes from the line of Kyle Voigt of KBW. Your line is open.

Kyle Voigt, Analyst

Maybe I could ask the first question about the IMPACT, the mobile app launch. Just wondering if you could help us quantify kind of the uptake or maybe new account growth that contributed in the fourth quarter? And then also just wondering if you could speak to how do you want to expect revenues related to that app to kind of show up? I noticed that in the app, you are advertising a bit more the interactive advisers and sustainable portfolios that are kind of prebuilt in there. Should we think about some asset-based fees as being maybe a bigger driver of revenues as this grows over a longer period?

Thomas Peterffy, CEO

No, our asset-based fees are only 8 basis points, which will not drive significant revenues; it’s more of a strategy to attract clients. Regarding the IMPACT app, it has had 40,000 downloads. We don’t disclose the revenue figures, but I wouldn’t anticipate they will be substantial.

Kyle Voigt, Analyst

Understood. And then I just sort of wanted to go back to the interest rate sensitivity discussion. I believe in the second quarter you had previously disclosed that roughly 14% of the customer credit balances, which was about $11 billion at the time, were fully rate sensitive or noninterest-bearing. I guess, is that still the right percentage to think about? And that 14% of total credit balances, or maybe you could provide an update to that $11 billion number just as we think about modeling, again, those kind of capturing the rate benefit past those first two hikes.

Thomas Peterffy, CEO

Yes, sure. It's still in the 14% to 15% range.

Paul Brody, CFO

Yes. We have a number of categories that total up to about 14.5%.

Kyle Voigt, Analyst

Okay. Maybe if I can just turn to expenses and then I'll jump back in the queue. Can you help us think about the level of fixed expense growth as we look ahead to 2022? You mentioned that you'll only invest if there's a positive ROI on the marketing spend, which I understand. However, when considering the fixed expense base overall, including hiring and other factors, can you discuss the pace of growth into 2022?

Operator, Operator

Next question comes from Rich Repetto of Piper Sandler. Your line is open.

Richard Repetto, Analyst

Yes. My follow-up question is regarding the OCC holiday when they did not charge you. Can you clarify how long this holiday lasted? Was it for the entire quarter? How much was it? I understand this does not affect your profitability, but can you estimate how it might influence the average commission?

Paul Brody, CFO

Right. So it wasn't a very big number. It was the last two months of the year. OCC over time has taken various approaches to their fee charging. What they used to do is charge even more about $0.05, $0.055 contract and then rebate it the next year. What they did this past year was they started high and then cut it in the middle of the year and then they looked at their financials and cut it to zero for the last two months. The number is about $2 million plus for us, somewhere in that range. So it's not extensive. You're right to point out that most of that savings is passed through to the customers; however, some of it is not because for customers who choose fixed as opposed to tiered pricing we would get the benefit of that. Probably most of it is passed through.

Operator, Operator

Our next question comes from Chris Allen of Compass Point. Please go ahead.

Chris Allen, Analyst

Just wanted to ask on execution and clearing. The fee impact is helpful there. You talked about the impact of the smart order router internalization on your ATS. And then obviously, there's been the competitive dynamic among exchanges. I'm wondering if you can just walk through maybe over the last two years, what's had the biggest impact in terms of lowering execution and clearing fees as a percentage of commissions? Any thoughts in terms of maybe on the exchange side, what the impact would be if some of the inverter pricing we've seen now goes away moving forward can't answer you there, but maybe Paul, can you?

Paul Brody, CFO

Certainly, I can provide some insights. One aspect is that our smart routers have significantly improved in directing orders to locations that offer competitive prices for the exchange while also providing better rebates. When we examine the difference between our commission revenue and direct costs, the increase in execution and clearing costs occurs because every dollar saved or rebated, when passed on to the customer, has a lesser percentage impact on commission revenue compared to expenses, which are already minimal. Therefore, even if we forward the entire rebate to the customer, the percentage spread will likely continue to widen. Additionally, as we draw in more orders to our ATS, we incur no external costs to process those orders, which further lowers our expenses.

Chris Allen, Analyst

Got it. Just one quick question on other fees and services. I know you discussed it, but we had a difficult time understanding some details. Could you quickly go over the key growth drivers for that from a year-over-year perspective?

Paul Brody, CFO

Well, over the current period, the drivers were market data. Market data is also offset by an expense, and we earned some profit on it. When we talk about the other case and services, that's the revenue side of it, exposure fees. We run stress scenarios on every client account, and when the stress scenario reaches a certain level, the system begins to charge fees. These charges encourage the customers to reduce their risk, and we collect those fees over time. The options exchange payments mandated by the options exchanges also go up with volume. So those are the major components of what's been driving up the other fees and services.

Operator, Operator

We have a follow-up question from Craig Siegenthaler of Bank of America. Your line is open.

Craig Siegenthaler, Analyst

I have a follow-up here on crypto trading and the partnership with Paxos. Can you just update us on your progress to add more coins? And if I think about your 1.7 million accounts, how many of them are active in trading cryptocurrencies today? And have you seen your crypto offering accelerate organic growth?

Thomas Peterffy, CEO

So we are going to add most probably two currencies and possibly two more within a month. The probable ones will be linked and matic, and the possible ones will be UNI and AAVE. Your question about the activity...

Craig Siegenthaler, Analyst

My second question was: Out of your 1.7 million accounts, how many are active in trading crypto today? And also, are you seeing crypto drive new clients to Interactive Brokers?

Thomas Peterffy, CEO

We are seeing a small number of new clients coming to us because of crypto. The uptake among our existing clients is kind of disappointing. I think that we have not been successful in emphasizing that our commission rates are two-thirds lower than the next lowest provider. The problem is that we do not have the popular currencies, and people cannot trade against each other on our platform.

Craig Siegenthaler, Analyst

Thomas, and I just had one follow-up here. This one may be even better for Paul because it's more of a financial question. We've seen your clearing and execution cost really decline on a long-term basis relative to trading activity and commissions, achieving some operating leverage and efficiencies. What is your thoughts on the future of that trend? Will that benefit continue into the future?

Paul Brody, CFO

We certainly hope so. We hope that the marketplace will provide us with more and better opportunities to have our smart router improve. We always look for those improvements and look to enhance our software. As I said before, the more volume we can attract into our ATS that has no associated external cost with those executions, the better our efficiency will be. We hope to be very successful with that.

Operator, Operator

Our next question comes from Mac Sykes of Gabelli. Your line is open.

Mac Sykes, Analyst

I have two questions. Your capital generation continues to be amazing, and hopefully, the uptick with the interest revenue. I assume that you have not changed your stance on wanting to bolster your balance sheet. But you had talked in the past about having some more capital for funding foreign margin. Is that still the case? Are you still seeing demand kind of outside the U.S. to be able to fund those margin balances?

Paul Brody, CFO

Yes. Basically, the answer is yes.

Mac Sykes, Analyst

Okay. And then on crypto, for those adopters, what are the policies related to using margin? Are you seeing some customers?

Paul Brody, CFO

We are not allowing margins. I have heard Mr. Gensler say that if you leverage a crypto, then it's certainly the security.

Mac Sykes, Analyst

And are you going to be able to offer short abilities for that and financing off of the currency holdings in the future?

Paul Brody, CFO

As I said, we cannot finance crypto. We will not plan for that.

Operator, Operator

Our next question comes from Dan Fannon of Jefferies. Your question please.

Dan Fannon, Analyst

Just Thomas wanted to ask about your confidence around the account growth of 30% to 40%, as we look at the Fed futures outlook for the heights that are currently being contemplated. How do you think that could change your account growth trajectory or, as I said earlier, your confidence around that?

Thomas Peterffy, CEO

I think if markets remain at current levels or go lower by less than 10%, and if there isn't a huge international catastrophe like some more, then I think that this rate of increase will continue.

Operator, Operator

Our next question comes from Kyle Voigt of KBW. Your line is open.

Kyle Voigt, Analyst

Thanks for taking my follow-up. I just wanted to circle back. I don't know if my audio was coming through previously. I'm just wondering if you could help us think about the level of fixed expense growth heading into 2022. I don't know if that's better for Paul or.

Paul Brody, CFO

No, I think we're essentially discussing communications, computers, salaries, and wages. I'm considering assuming a 15% growth rate for vehicles. Do you have any updates on that?

Kyle Voigt, Analyst

No, I have no other opinion than yours on that topic.

Paul Brody, CFO

Okay. So as I mentioned, our fourth quarter margin yields compressed to about 114 basis points. I think last quarter they were 120 basis points. I'm assuming that was just mix in terms of the balance tiers in the fourth quarter. Is that right? Actually, Kyle, last quarter you did mean in the third quarter as a comparator.

Operator, Operator

Okay. All right. Thank you. At this time, I'd like to turn the call back over to Nancy Stuebe for closing remarks. Nancy?

Nancy Stuebe, Director of Investor Relations

Thank you, everyone, for participating today. As a reminder, this call will be available for replay on our website. We will also be posting a clean version of our transcript on the site tomorrow. Thanks again, and we will talk to you next quarter end.

Operator, Operator

This concludes today's conference call. Thank you for participating. You may now disconnect.