MNTN, Inc. Q1 FY2026 Earnings Call

Hello and welcome to the Mountain First Quarter 2026 Results Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please raise your hand. If you have dialed in to today's call, please press star 9 to raise your hand and star 6 to unmute. I will now hand the conference over to Brynley Johnson. Please go ahead.

Good afternoon. Thank you for joining us for Mountain's First Quarter 2026 Earnings Call. With me today is Mark Douglas, CEO, and Patrick Polin, CFO. Just to remind everyone, today's call includes forward-looking statements that are subject to risks and uncertainties, and actual results can materially differ from those anticipated in these forward-looking statements. For the risks and uncertainties that may affect future results, please see our most recently filed periodic report, which is also available on our website. We will also discuss non-GAAP financial measures on today's call. Reconciliations of these measures are available in our earnings materials on our website. And with that, I'll turn the call over to Mark. Please go ahead.

Thank you for joining us today. Mound reported strong financial results, delivering first quarter revenue growth of 25% year over year, along with strong adjusted EBITDA growth of 74% year over year and record positive net income. Before we get into numbers, I want to take a step back and remind everyone about Mound's unique value proposition that they connect to TV market, and then discuss our future priorities that continue to position Mountain for a long runway of durable growth. I've said this many times, I founded Mountain with the mission to democratize television advertising. Democratizing TV means bringing any size brand from emerging e-commerce companies to category leaders to the most exciting storytelling medium in the world, the TV in your home. And doing this for one reason, to enable emerging organizations to grow their business and drive incremental revenue. These brands want to reach very specific consumers alongside content that not only performs well, but elevates their brand. And they want that investment to be measurable from the start. That's performance marketing applied to television. It's simple. Choose your budget, your audience, your goals, and upload your creative. Everything is automated from targeting optimization, bringing digital marketing precision and accountability to streaming TV. AI plays an ever-expanding role in that automation, but we're using AI in creative too. Quick Frame AI, our AI-powered creative video platform, was released from beta this morning and has become one of the fastest growing elements in the mountain sweep. Our customers benefit from using QuickFrame AI as it combines AI video generation with professional-grade creative controls, so teams can produce polished videos easily, iterate continuously and go live quickly. The latest release, QuickFrame AI 3.0, brings a major expansion of capabilities. This update includes saveable characters, a new storyboard editor, collaborative editing and more. It continues to evolve as a creative platform designed to accelerate creative output and bring more campaigns to market with less friction. Mountain has consistently led through product innovation. We've been first in performance TV in a number of innovations that directly impact our customers. That includes the first brand direct self-serve platform for television, the first company to bring performance advertising to connected TV, TV, the first to provide AI targeting for connected TV, and the first to provide creative AI tools that can create TV commercials in minutes. We'll continue to innovate and expand our AI capabilities with several new features already in customer beta and moving towards broader release. We also recently announced the addition of Garland Hill as Mount's chief revenue officer and Peter Blacker as head of content. Garland was previously head of growth at TikTok. He launched that team from scratch to over 1,000 people and billions in revenue. Prior to TikTok, Garland led the CPG sales team at Meta. No one is better suited to lead and continue to build Mountain's revenue. Peter Blacker's previous role was head of streaming at NBCUniversal. We built NBC's streaming division. Television has the best content in the world, and Peter's role at Mountain is to ensure Mountain provides our customers access to nearly all of that content. In Q1, we provided our customers access to performance advertising across nearly all streaming networks, including advertising on March Madness, the NHL playoffs, Major League Baseball, reality content like Housewives, Traders, and more. We have even more exciting content continuing to roll out due to Peter's efforts. Together they fortify two key areas of our growth strategy, scaling revenue, and continued access to the best TV content available. Looking ahead, our priorities are clear. First, continue to attract new customers. We're very focused on bringing new customers onto our platform and actively expanding our footprint in the SMB market. We're executing on a massive opportunity and a TAM that we created, having successfully transformed TV into a measurable performance-driven advertising channel. Second, innovate and launch new products. products. We continue to invest in R&D and have a strong product pipeline positioned to capitalize on this market. As of today, over 50% of Mountain's headcount is engineering, which we believe is the highest in our industry. Third, leverage AI. AI is an enabler to our business to both improve our product innovation and to become more efficient in our own operations to drive margin expansion. And finally, accelerate our go-to-market. We are investing in sales and partnerships to broaden distribution and reach more customers. Mount is helping a whole new generation of marketers unlock the full potential of television as a performance channel. With solid customer growth, continued innovation across our platform, and expanding margins, Mount is well positioned for sustained growth and profitability. Now I'll turn it over to Patrick.

Thank you, Mark. We reported strong first quarter results to start the year, exceeding our prior revenue and adjusted EBITDA guidance. Our solid performance reflects continued customer adoption of performance TV, particularly by companies that had not previously advertised on television. Our first quarter revenue increased to $73.7 million, up 25% year over year after adjusting for the divestiture of maximum effort on April 1st of 2025. To note, this will be the last quarter where we report revenue excluding maximum effort. We again included a table in our press release and also in our investor presentation that breaks out our revenue growth and gross margin over the past several quarters, both including and excluding the prior year's contribution from maximum effort. First quarter gross margins improved to 81 percent, up 1,220 basis points over the prior year period our core ptv business improved over 980 basis points with the balance coming from the impact of the maximum effort divestiture as well as a full quarter of reduced hosting costs as you can see from the table on our earnings release at the end of q1 we had 3874 active ptv PTV customers when measured over the trailing 12 months. On a year-over-year basis, this represents growth of 46%. It's worth reiterating that the number of active PTV customers we bring onto the platform is entirely within our control and is predominantly a function of how firmly we step on the accelerator to move down market. Our intent is to regularly evaluate and adjust our efforts to ensure that we are onboarding clients that have strong product market fit and a likelihood of succeeding on our platform. And as a result, this number will bounce around from quarter to quarter. Our expansion rate, which measures the spend of our current customers as compared to those same customers spend a year ago, is quite healthy and remains well north of 115 percent, continuously demonstrating that when our customers achieve their desired returns on advertising spend, they continue to increase their budgets with us. Total operating expenses for the first quarter were $50.4 million. For the first quarter, we achieved positive net income of $8.8 million for a GAAP EPS of $0.12. Adjusted EBITDA increased to $16.3 million, up from $9.4 million in Q1 of 2025, an increase of 74%. The company's adjusted EBITDA margin grew to 22.2 percent, up 770 basis points, compared to 14.5 percent in Q1 of 2025. The improvement was driven by increased revenue and gross margin expansion, and demonstrates the leverage inherent in our model. Although we are committed to gradually delivering operating leverage, our primary focus is on pursuing strong growth rather than maximizing our margins accordingly we will continue to aggressively and strategically invest in sales and marketing to drive penetration into this nascent but large market opportunity this may cause our EBITDA margins to bounce around from quarter to quarter as the timing of our investments may not always match the slope of our revenue growth our balance sheet remains strong and we ended the quarter with 215 million dollars in cash and cash equivalents with no borrowings outstanding we entered the quarter with 73.9 million shares outstanding and looking ahead we remain confident in our momentum and the underlying health of our business for q2 2026 we expect revenue in the range of 81 and 83 million dollars representing 20 year-over-year growth at the midpoint of 82 million dollars we expect adjusted EBITDA to be between 19 and 22 million dollars reflecting continued leverage as we scale the business while continuing to remain disciplined in our investments for the full year 2026 we are raising our revenue guidance to the range of 347 and 357 million dollars representing over 24 percent year-over-year growth at the midpoint of 352 million when normalizing for the effect of the divestiture of maximum effort we expect adjusted EBITDA to be between 96 and 101 million dollars to wrap up we delivered another solid quarter and believe mountain will continue to gain market share in the massive performance television market we are confident that our future growth initiatives and the strength of our operating model will position mountain to drive continued growth and profitability. With that, we'll open up the line for questions.

We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please use the raise your hand function. If you have dialed in to today's call, please press star nine to raise your hand and star six to unmute. Please stand by as we compile the Q&A roster. And your first question comes from Cheyenne Patil of Susquehanna. Your line is open. Please go

Go ahead. Hey, guys. Congrats on the continued strong execution and results. Mark, I had one question for you. You mentioned in your script that the company has made some pretty significant hires with some very strong backgrounds in this space. Can you just talk a little bit more

about this and maybe what you're envisioning? Thank you. Yeah. Thanks for the question. So what we're seeing is that we think the market that essentially we created, which is the concept of performance TV and bringing television to the small and midsize business sector, that that market is starting to move kind of early adopter to mainstream. And so we made added these individuals to team Garland Hill, Peter Blacker, and they, of course, also adding people to the teams, their teams that they're that that they're building out in the company in order to kind of meet that mainstream market head on. Um, Garland in particular, you know, he has been involved in significant buildouts in the performance marketing space. So I think his experience, his knowledge, his skills, um, and his network are, are incredibly valuable to the company. Um, same with Peter in turn, he was there day one, um, building out streaming at NBC universal, kind of building out that team and that whole concept for NBCUniversal and Peacock. So I'm pretty excited about these individuals, them being on the team, the people they're going to bring. And I'm excited for, you know, kind of as the year unfolds and we see the market kind of going, like I said, from that early adopter phase into kind of the mainstream segment where every company starts to expect that, you know, they can be on television as part of their marketing mix. Thanks.

Thanks, Mark. And your next question comes from the line of Ronald Josie with Citi. Your line is open. Please go ahead.

Great. Thanks for taking the question. Mark, I want to ask about your streaming partners. And just with the addition of more and more tentpole events like March Madness and NHL playoffs, and obviously the hire of Peter, just talk to us how your partnerships have evolved here and how your partners are viewing you as an additional source of monetization. Anything's changed here or perhaps accelerated? And then I wanted to ask, of course, on QuickFrame AI 3.0, clearly we're now on version three after having been in beta for only maybe since the fall. Just talk to us how the sales cycles have been post-QuickFrame, how conversion rates, anything along those lines. Thank you.

Sure. So, in terms of the, well, I'm sorry, I got caught up in the question. Streaming Partners and Evolution. Oh, Streaming Partners, yeah, sorry about that. I started thinking about the quick frame question. So, I think what's really critical here is that in order for performance marketing the work, you have to reach the consumer where they are, right? So meaning that you can't pick a network and maybe some of the people that you want to reach are watching. You need to reach everyone that's within the target group of consumers that you're going after. So we previously have built out relationships with virtually every streaming network in America. But as the overall connected TV space has brought on things like live sports, like you said, tentpole events like the Oscars, as those have come to streaming, we think it's important that we bring our customers to those events also. And so bringing Peter on, he would, you know, obviously this year, NBC is like covering virtually everything. They have the Olympics. I think the World Cup, just his experience and knowledge in terms of how that content plays out with all the relationships that we already have with these networks, as well as he has. We just thought that that was a role where we wanted someone with just tremendous experience in this industry to be making sure that Mountain is giving our customers access to everything. And then in terms of relation with networks, I believe they view us as a growth channel. I've said this stat many times before. 95% of our customers have never advertised on television before. And so that's net new revenue in industry. So that means to mountain end to our partners. And so this is his role is just a really important part of wherever the consumer, that target consumer is, mountain is there and we're bringing our customers there with us. And then in terms of the comment or the question about QuickFrame AI, the product is new. We want it to really work. We're going after not just video clips, full-blown professional quality commercials. So we did a long beta. We've had many, many companies use Quick Frame AI and continue to use Quick Frame. And we thought with this version three, this was really fully ready for anyone to use. And we're really excited. The team is excited. And we're excited with the commercials that people are building in the product and that they're going to continue to build. In terms of a question about the sales cycle for Quick Frame AI, currently that we, you know, most of our younger customers, or I guess you could say small businesses, are in some way using Quick Frame AI, and so we're excited about that. But we're not really measuring in terms of length of sales cycle. We're measuring it more in terms of, you know, how quickly can companies get live and can they keep refreshing their creative over and over and over again after their lives. So that and those are stats we're looking at. We're excited about where that's headed.

Thank you, Mark. Thanks. And your next question comes from Andrew Boone with Citizens. Your line is open. Please go ahead.

Thanks so much for taking the questions. I'd like to start off in terms of guidance. The four-year guide implies just an acceleration in the back half. Can you guys either explain that to us or just talk to us about the confidence you have to be able to achieve that? And then, Patrick, I think in your comments earlier, you talked about throttling new customers in terms of onboarding. Can you just talk to us in terms of how you guys think about the pacing of onboarding customers, and what may be a good fit for the platform versus what may not be. Just help us understand the dynamics of what you guys are looking for in terms of customer ads. Thanks so

much. Sure. So I'll take the first one, and Mark and I may share the second one, Andrew. So we continue to see a lot of strength in the PTB business, and that's indicated in both our Q2 guide and our fiscal year guide. We anticipate continued growth in revenue and adjusted EBITDA, and see a long runway of growth ahead of us. The Q2 guide is 81 to 83, 82 at the midpoint, 20% year over year growth. The fiscal year guide is 347 to 357, 24% growth at the midpoint. And we continue to invest strategically in things that will drive revenue growth, particularly in sales and marketing. And we also have initiatives that, as you know, to continue to improve our gross margins. So the combination of strong customer and revenue growth, gross margin strength, discipline investment to drive more revenue, we think sets us up very nicely for the future.

And in terms of the second question, I think I can start to address that. So I think the way you should think about it, or the way we think about it, is you have small business and what we call mid-market. One of the lines of distinction is the size of the business. But an even more important line of distinction is as companies get larger, they have dedicated marketing teams, and those teams have basically very specific needs. In our platform, we initially focused on the needs of those mid-market customers. Smaller businesses tend to be often more kind of owner-led, owner-controlled. You have individuals in the company handling a lot of marketing who maybe not as developed a marketing skill set. So we essentially see those as different and the needs, the core platform are the same, but some of the needs of the platform are different. Our mid-market has been consistently growing the entire time, you know, since we launched version one of the kind of the concept of Performance DB. We see the small business as something where we want to make sure they come on, they're successful, our cost to acquire them is where we want it to be, and that they have long and sustained growth. So each quarter, or really each month, if not even each day, we are making adjustments in terms of how much small business we're driving towards, adjustments to the product, to the reporting, and things like that. And so when Patrick says we control it, what he means is we control the marketing investment and acquiring those customers. We control where they come on board in terms of product minimums. And we want to make sure that we continue, obviously, our success in mid-market, but we also are bringing on small business at a sustainable and responsible and profitable rate. And so that's why that part of our business, we kind of take up and make adjustments to in order to kind of really land that exactly where we want it. And that will continue to evolve over the course of the year and beyond. And it's something that it's one of the most important topics in the company because to realize our full vision, we want all businesses to have access to it, but with the right feature set, the right price point, and something that we're constantly evolving and we have dedicated teams on.

And we did grow 46% year over year.

Yeah, in terms of customer growth.

Thank you. And your next question comes from Robert Kulberth with Evercore ISI. Your line is open. Please go ahead.

Hi, everybody. This is Rob on the call from Mark. Thanks for the opportunity to ask the question. I wanted to ask two if we could. First, I just wanted to maybe follow up on the quick frame question. Are there any benefits you're seeing in the beta period that are giving you more confidence in the go-live times, the career of refresh, and sort of matching up the product with where it needs to be for customers to have success, especially as you go down market in the SMB? Does that give you any additional confidence, Patrick, to invest incrementally or press a little bit harder on the accelerator, to use that metaphor? And then secondarily, the gross margin came in, I think, a fair amount, better than we expected. Any particular numbers that you pulled in the quarter that you'd maybe like to call out?

Sure. Mark and I will share the first one in terms of the, and your question was again, Rob.

Are there any benefits we're seeing?

Yeah. Why don't you do the anecdotal benefits?

Yeah. So I think in terms of quick frame AI, so why is version three, the version that we're now calling full production? We did, you know, we basically announced that today. You'll see more in terms of marketing. um it's essentially we've been um literally watching customers use the product looking at the rates of starting projects getting them live how much time it's taking them and we felt we was really pleased with where those metrics were getting to and we and kind of our ability to scale that and just kind of the knowledge that people needed to have to do it so we've kind of brought the effort down the the go live rates up in terms of quick frame ai um we were seeing that people with less creative skills were increasingly more successful part of that is the investment technology we made i think in the announcement we announced now you can have savable characters which is like casting inside you know ai casting essentially savable locations um you can pick products you want in the video it all of that functionality also part of it is that the ai generative models are just keep getting met um getting better and we're integrated with all of the best models so c dance 2 cling you know the gemini vio from google and other models and like that inflection point it's hard to remember but literally last march you could not create a usable AI video and we're just a little over a year later and like the the evolution of these models as well as the evolution of us orchestrating them to create professional great videos just reached a point in terms of the benefit to our you know sales cycle or go live times and things like that we're definitely seeing benefits there in terms of small business mainly because there's no approvals involved like the person can come on create an account create the video and go live um and in the mid-market segment there tend to be a few more approvals involved there may be professional video people involved so we're seeing some improvement there but the improvement on the small business sizes is side is is pretty significant well you know the the um and i don't think we're ready to exactly um quantify you know provide those numbers but we're really excited about the release that went production today like really really enthused about the the the what this is going to mean for customers and and where that you know the metrics are headed in terms of quick

frame and the resulting impact on mountain so rob in terms of um the cost and so we i think we have enough anecdotal evidence that it is what we thought it would be, which is an enabler to our core PTD business, particularly in small, but also we see a lot of mid-sized customers using it. The cost is, we haven't quantified it yet because we just came out of beta, but the cost we're managing, I think, quite well. So it's worth what we're seeing in terms of enabling both mid-sized customers in small businesses to get TV commercials to get on the platform. And so I think as we now with it sort of released generally, I think we will start to track that more, but we've never really built it necessarily for a revenue stream, but rather to enable the core PTV business.

And then Patrick, anything you can just call out on gross margin? A little bit better. Thank you.

Yeah, sure. So, you know, we had a nice quarter in terms of gross margin at 81%. Again, that is a mix of strong revenue growth because revenue growth drives gross margin improvement. But we also, you know, we got rid of maximum effort, we spun them out, and that gives us a huge benefit in terms of the creative cog. And similarly, for Q1, we had the full benefit of the switch of hosting providers. And so I think the combination of that is actually quite strong in terms of, and we think that will continue into the future. We think the combination of revenue growth, driving gross margin, the creative cog, the hosting cog, and the other cogs having discipline around them will put us, you know, squarely in a position to stay in the long-term target of 75 to 80.

All right. Thank you. And your next question comes from Matt Weber with Canaccord. Your line is open. Please go ahead.

Hi. Thanks so much for taking the question and congrats on the strong quarter. Just as we think about the broader macro backdrop, how would you describe the health of your SMB advertiser base over the past few months? Have you noticed any changes in budget pacing or campaign duration that might reflect a tighter discretionary spending environment? And are large enterprise customers behaving any differently?

Yeah. So in terms of the macro, for the SMB sector, I don't really think they're greatly affected by macro unless it's very, very difficult circumstances. I mean, you can look back to COVID where literally like just essentially all business nearly stopped. And that was one of the biggest years we had and many other companies in the performance advertising space had. And that's because company, S&B customer companies, you know, merging companies, they're in difficult environments. They don't lose their ambition. If anything, they are more determined to grow in order to outpace their competitors. And so we're not seeing any meaningful impact. I would say nearly zero impact from macro concerns or anything to that effect. In the enterprise space, if you mean like truly large global brands, that's not really a part of Mountain's business. And so I would look to other companies to kind of answer that question. But in the SMB market, we are seeing full speed ahead in terms of our customers. I don't like macro is not mentioned. It's not something where they're coming to us and saying like, oh, because of concerns over whatever macro concern of the day there is, we're pulling back spend. It's just not a compensation. They are entirely focused on return on ad spend and hitting their gross down to the individual who often has bonuses tied, personal bonuses tied to hitting metrics and things like that. So in a metrics-focused business like they are in and we are in, these are not generally things that we've had to deal with.

Gotcha. That's a great answer. I like that answer. Just as a quick follow-up, switching gears, is there any update you can share on your media planning tool when you're targeting to bring that to market? And anything you can share in terms of the key points of differentiation versus existing solutions that are in market today? Thanks so much.

I was joking to some people today that I'm obviously not Steve Jobs, but I usually have one more thing. I definitely am a product guy. Yeah, you'll be hearing more about that very soon. We think it's another exciting development in terms of AI technology from Mountain. So it's with customers. We're getting very positive reviews on it. I have a tendency to talk about things before they're fully released in production. But so you remembered. And that is something that I'm pretty excited about. and you'll be hearing more about soon.

And your next question comes from Andrew Merrick with Raymond James. Your line is open. Please go ahead.

Hi, thanks for taking my questions. Maybe two, please. First, if we could talk a little bit about the recent Pinterest announcements that they're doing with TV Scientific, just kind of how that affects the broader performance TV space and you in particular. And then second, given what you mentioned and what you've seen out of events in Q1, like March Madness and the Pro Playoffs. How are you thinking about a World Cup boost as we get into the summer months?

So first, in terms of question about Pinterest and TV Scientific, I think at one time, TV Scientific was kind of a company that was trying to, I think, kind of copy Mountain in terms of concept. a performance TV. I think Pinterest's interest in them was driven because they have a lot of data and they wanted to find more ways to monetize it. So that makes sense for them. We're not seeing that as, you know, kind of competitive in terms of we run into TV scientific and sales cycles or anything like that. So I think that's, you know, again, a way for, you know, Pinterest to kind of find more ways to monetize the data that they get from people using Pinterest. So not competitive to Mountain. In terms of the World Cup, it's a massive event, especially the fact that it's in the US this year. And the Mountain is making World Cup available to our customers. One thing I want to remind though, our customers are always focused on return on ad spend first. So we think I've said many times, you know, television has the best content in the world. We think it's important to our customers beyond all of that, that we think wherever the consumer is watching, if it's the target consumer for a brand on Mounds platform, we want to be there too. But the spend on our platform is ultimately not driven by the television content, meaning like not a specific event like World Cup is driven by the return on ad spend. And you get that by being on all available content, including content like the World Cup. So we would definitely be there. But it's not something that is like a separate line item or separate, you know, like effects or guidance or internal forecasts or anything like that.

And your next question comes from Rob Sanderson with Loop Capital. Your line is open. Please go ahead. A reminder that you may have to unmute locally.

Yeah, thanks for the reminder. first time user on this mute button. Sorry for that, but good afternoon. Thanks for taking my question. I want to talk about your go-to-market evolution. The past few years, your business has really been driven by inbound leads and like 90% plus of new customers, but you've expanded to Salesforce quite meaningfully recently and seem to be focusing a little bit more on developing agency relationships. So can you talk two things, Mark, maybe speak to how these efforts are going so far um you know when do you expect to see more sort of fruits of those those efforts i know it takes a little time to build and then um you know are these like direct sales and agencies would this be kind of incremental to inbound or are you kind of shifting the the mix deliberately somehow and and then um you know uh you know any notable margin implications as the mix changes

um yeah so in terms of go to market i think that speaks to my point about excuse me my earlier point about the market going kind of early adopted and mainstream. So the agencies that Mountain works with are generally performance agencies. So they're not like a WPP or publicist. They're independent agencies that built their businesses around paid search, then paid social, and now see Performance TV as a new opportunity for them. And we want to be there to power that opportunity and to help them grow and to help them build their business that's not necessarily a shift in our strategy so the more than 90 percent of performance tv advertisers don't use an agency so there's no opportunity even if we wanted to shift it you can't because the the you have to go where the customers are and the vast majority of performance advertisers are direct They're direct users in our platform and other performance platforms like like the meta ad platform. But there is a portion of the market, a sizable portion, you know, 10 percent. And that tends to be larger, midsize brands who do use agencies. We think that's great. We want to be a great partner to them and vice versa. And we're we're being there. We built we started. I mentioned on previous earnings calls, and I think we did a press release last year, that agency was one of the faster growing segments for us, and we continue to see that as a big opportunity. And that is part of, with Garland coming on as chief revenue officer, how he's shaping his organization is around making sure we have coverage wherever there's opportunity, both direct to brand and via agencies to brand. In terms of how that shifts our mix, we ultimately count the brands. So we see the agencies as a one-to-many opportunity, meaning that one agency can bring many customers. But we still ultimately look at it as what's the number of brands that we're working with. They are ultimately the financially responsible party and the final decision and the decision maker on use of our platform. So that so that it always at some point goes back to the brand, even with agencies, you know, being an important part of that that relationship in those instances.

And the direct sales expansion.

Yeah, the direct sales, I think, like you said, it's a bit early. We have no concerns there. we know, you know, we think the opportunity is large and there's more than enough room to continue to expand our sales organization to meet it head on. And so, like you said, that takes a bit of time, you know, to fully cement and, you know, kind of like those individuals become fully productive, but we're pleased with where that's headed. And that's something that we viewed as a pretty low risk investment that we were ranking. Yeah. In terms of margin, Rob,

I mean, as you've seen, our model has a lot of natural leverage in it. And so I don't think it will have an impact on our bottom line margin. Okay, great. If I could do another on just the

competitive sort of dynamic and some of the sustainability factors, like larger players are all aspiring to move down market and focus more on SMBs and that's, you know, Amazon and Roku and Apple Evan's going to do more here and Trade Desk eventually maybe aspires to serve smaller customers. So, you know, what do you think that some of the more common misperceptions you think investors have about your competitive differentiation and, you know, just what are the most durable elements of your competitive mode? Yeah. So to answer your question, so we

we are purpose-built for the S&B market, which means that, and let's talk about some of the differences. So the targeting is incredibly important because when the smaller the business, the smaller the target pool of customers. And so instead of you trying to reach, you know, millions of consumers in the U.S., these are businesses that are often trying to reach thousands. And so when you're spending money on performance TV like this, you have to have incredibly pinpoint targeting, which is why it was so important that we started leveraging AI technology really early as part of our targeting engine. They don't have TV ads when we meet them. So 95 out of 100 companies that come to mountain.com, at least 95, might even be higher, don't have a television ad when they visit our website. And they don't have the budget to go get production crews so we've addressed that um the the and the even the way we buy ads or programmatic bidding engine is purpose built to respond to signals on performance and alter the ad buy in order to to buy the right media we talked a little earlier about media planning like all of these things are there are purpose built for the smb market plus more giving the customer a single solution that addresses all their needs across nearly every streaming network in America, gets them on premium content, not remnant content, and gets consumers to respond to these ads. And then there's a final thing, the go-to-market motion. If you have a sales team built around large enterprise customers, getting that team to want to go after small businesses is nearly impossible. So you have to essentially build a whole nother sales organization, marketing organization, drive more traffic to your brand and get them to sign up. All of these things have to be built out. So I respect the efforts of other companies. I think basically it's a big validator of the scale of the opportunity if Roku, if Trades or others see this as in the future a potential area to go after. But we're also not standing still. We're moving forward, capturing more of the opportunity. And, you know, again, you can't just take an enterprise, go to market motion and enterprise technology and just kind of say, now let's offer it to small businesses. You have to kind of build a whole new organization and technology platform for the small businesses, and we think that's something we've already done, we're really good at, and we never stand still in doing, which is why, you know, more than half a mountain is engineers, software engineers working at the company. So we're excited about that.

Thanks for all that.

Thanks, Mark. And your next question comes from Laura Martin with Needham. Your line is open.

please go ahead. Hi there. So I sort of, so I want to talk about orchestration. You've talked in the past about orchestration. And what's interesting is you were first on that, but that is what Amazon is saying that they're seeing on their bedrock platform is that almost all companies are using multiple AI LLMs. And I'm wondering if you have any move forward and being an orchestration layer a and then on the competitive landscape sort of building on that last question um you know one of the things we're hearing from other companies is that everybody's getting into omni-channel performance that they're adding connected television because they were in the open internet which is threatened by chatbots my question to you is is there some competitive advantage for you guys of not being omni-channel and just being performance ctv thank you yeah

Sure. So I think in terms of the first question, orchestration, when I'm using that, that's primarily in the context of the creative, although it definitely can apply in any area. I think at the end of the day, what it means is using the best-of-breed LLM, gender of AI capabilities or gender capabilities for whatever the specific task and content of that task is. Now, when it comes to creative 30-second TV commercial, or even starting to be longer, that can mean different scenes in a commercial might be using different basic LLMs. In other words, C-Dance might be in one, VO in another. Some are better at showing products. Some are better at having multiple talking actors. And so in order to get to professional quality video, you have to have a layer of technology that knows that and can orchestrate them, plus voiceovers, plus music and things like that. And that's something we recognized really early. And we built out a whole layer of technology to do. And we consider that part of a technology to be proprietary. And it's essentially using our own AI tech in order to do that. And so it's a really important part. In terms of whether other people can do that, they better because they're not going to be able to match the quality unless they do. I don't think everyone's going to reach that level. But, you know, at some point, we're probably not going to be the only ones that recognize that that's needed. And so, you know, that's just kind of normal course of business. In terms of omni-channel, I think the biggest advantage we have that sometimes goes unspoken is we have the highest level of performance for TV. We have never been in a head-to-head test, just mano a mano, your performance against our performance, and we lost. And why is that? It's because we've been doing this longer. We built out models longer. We built out the programmatic ad stack built to drive outcomes. And so we see it right now that competitively being the highest level of performance for an area. In other words, if someone's the highest level of performance for social, that maintaining that lead is a big part of their competitive advantage. In our case, being the highest level of performance for streaming TV is a big competitive advantage. As to whether we should go omni-channel, I mean, I wouldn't say we're not doing that right now. It's something that I think about. and ultimately I'm going to follow the customer as to the customer is looking to basically just give a bag of money to one company and say, hey, you spend it and let me know the results. Right now, I think it's intriguing but I don't think it's clear that that's, it's where I think some of the players in the ad space market want to go but I'm not sure the customers are fully on board so we'll see how that develops And I think it's an interesting area that, you know, Laura, you know, we talk at conferences and things like that. I'm sure it's an interesting area we'll continue to talk about.

Thank you. Thanks very much.

There are no further questions at this time. I will now turn the call back to Mark for closing remarks.

I will just say I thank everyone for their time. We're happy with this quarter and we're excited about the rest of the year. so stay tuned and we'll keep doing this. And that's it. Thanks, everyone.

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