Par Technology Corp Q3 FY2025 Earnings Call

Good day, and thank you for standing by. Welcome to the PAR Technology 2025 Third Quarter Financial Results Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Savneet Singh, PAR's CEO and President.

Good afternoon, everyone, and thanks for joining us. Q3 was another strong quarter for PAR, one that shows the progress we're making on all fronts: growth, profitability, and cash generation. We delivered $119 million in revenue, up 23% year-over-year, driven by software subscription and hardware revenue growth. Our adjusted EBITDA came in at $5.8 million. This number includes $800,000 of accounting adjustments for non-period costs, which, when further backed out, brings our adjusted EBITDA to $6.6 million, continuing a nice march upward in EBITDA and cash flow. Our commitment to a flat cost base also played out. Non-GAAP OpEx was 44% of revenue, down from 60% just 18 months ago. This result was driven by our commitment to improving our operating leverage and our ability to begin to realize the operational savings being driven by AI utilization internally. Our ARR hit $298.4 million at the end of Q3, up 15% organically, reflecting steady execution across both sides of our platform. All told, ARR grew $12 million sequentially in Q3, and we expect that number to increase in Q4 to take us to our goals for the year. Now, to dig into our business performance in the third quarter. Q3 was another quarter of solid execution for Operator Cloud. ARR increased 31% year-over-year, including 14% organic growth. In Q3, we proved we can scale large enterprise deployments, innovate with AI, and keep customer satisfaction high, all while maintaining a disciplined focus on expense management and pursuing additional multiple large Tier 1 opportunities. Our POS business continues to perform exceptionally well. Our Burger King implementation cadence during the quarter accelerated dramatically with high efficiency, and we're pacing to meet Burger King's target for 2025, which then creates great visibility for 2026. Our OPS platform had a steady quarter as we ramped into Burger King and another large Tier 1 enterprise. The real story, though, in PAR OPS is the momentum in new launches and innovation. We brought Coach AI to market, an AI-driven assistant that allows operators to prompt operational questions in natural language and get immediate answers from their data. This innovation comes from combining delegate and data center product suites, and we see cross-sell and upsell possibilities across our wider base. We also launched AI chatbot support, helping users self-service faster and reduce support ticket volume, a meaningful productivity win. We expanded our international functionality and onboarded a Burger King franchisee in Canada across all sites, including French language functionality in Quebec, showcasing our ability to deliver for global customers. The PAR OPS operational groundwork and product expansion we put in place will pay off nicely in 2026 as we enter the year with a record backlog and customer commitments. Turning to TASK. As we mentioned last quarter, we pushed that rollout to next year in preparation for large RFP work. As we now move from RFP to actual development, our goal will be to maintain our launch schedule for next year with new customers while we begin our aggressive build schedule for this Tier 1 opportunity. That's a major validation of both product and team capability, and hopefully, we will have more to share publicly in time. What is crucial is that 2025 is proving to be the strongest bookings year in the history of the Operator Cloud segment, paving the way for years of sustained growth. On last quarter's call, I mentioned that we had $20 million in POS contract value that has not yet been rolled out. Our late-stage and weighted pipeline on PAR POS more than doubles this number again, ensuring a robust growth foundation for years to come. Now turning to the Engagement Cloud, which also had a strong Q3. Engagement Cloud ARR grew 16% from Q3 last year, including 15% organic growth. We continue to see real momentum and investment in digital engagement in the markets we serve, as brands look to connect more deeply with their guests. What's exciting is that, similar to last quarter, 70-plus percent of new deals signed in the quarter were multiproduct, including loyalty ordering intake, showing that customers increasingly see the value in the full engagement ecosystem, not just one solution, but the whole connected platform, a single cockpit to manage your entire digital business. We also saw renewals and upsells for Punchh with 3 major Tier 1 brands, proving that our long-term partnerships continue to grow stronger over time. On the innovation front, we launched new capabilities for the Engage for engagement in catering and games, both of which enhance the competitiveness of our solution and add real differentiation to our overall engagement platform. Moving to PAR Ordering. I'm encouraged to report that this is our biggest win quarter for PAR Ordering to date, highlighted by 6 new customer wins, all upsells and multiproduct deals, including a 400-plus location enterprise chain, a clear signal that our products are winning at scale. In the quarter, we were also able to sign 2 new customers that were previously using the largest online ordering provider in our space. We hope this creates a template to accelerate our growth in 2026, as PAR Ordering is not only a best-in-class platform now, but also an incredibly easy proof point of our Better Together thesis. Customers of PAR Ordering and Punchh, and POS can now update menus in one place, push changes to third-party delivery channels, and manage every aspect of their digital business from just one system. It's one of those few times in the enterprise software world where the demo just speaks for itself. Our solution for fuel and convenience stores, PAR retail, had a standout quarter, demonstrating what execution and innovation look like working together. In Q3, we hit key integration milestones and launched new features that are driving record engagement and customer success. We also added 4 new enterprise wins, including a successful Punchh to AT Retail migration in the quarter. It's important to note that, as we finalize the transitions from Punchh to PAR Retail, there's an opportunity for us to expand gross margins by taking out Punchh convenience store costs and increasing the price for moving customers to the more robust PAR retail platform. From a product perspective, we made Command Center smarter and more dynamic and introduced the messaging center and audience experts, making it easier for retailers to launch campaigns and analyze audience data in real time. And all of this hard work and achievement is paying off. Nearly every customer hit an all-time high in active program membership this quarter. A great overall quarter for PAR Retail continues to demonstrate leadership in digital trade and engagement with strong customer results and momentum heading into 2026. A few summary thoughts here before turning it over to Brian for a deep dive on our numbers. I briefly mentioned this earlier, but this quarter marks a major milestone in PAR's journey to redefine restaurant technology with the launch of PAR AI, our new intelligence layer built natively across the PAR platform. The first product in the suite, Coach AI, is now live and already transforming how operators manage their business. PAR AI is different. It's built in, not bolted on. We've embedded AI intelligence directly into the operational workflow across POS, back office, loyalty, drive-through, and payments. This approach turns every PAR product into an active decision engine, creating a connected intelligent restaurant ecosystem, all pulling data from a clean pane of glass. Coach AI is our first step. It's an operational intelligence assistant that enables restaurant leaders to ask natural language questions and instantly surface live insights from POS, labor, and inventory data. No spreadsheets, no extra apps, no manual reporting. Importantly, it dramatically lowers the know-how required to be an operational expert, allowing more employees to engage with the product and, most importantly, saving brands hours of time. Early customers like Charter Foods have already eliminated the need for traditional BI tools and are realizing meaningful time savings and better decision-making. What's next? Later this year, we'll introduce a marketing intelligence assistant with the PAR engagement platform, enabling marketers to instantly analyze campaign performance, loyalty data, and customer engagement metrics in real time. Imagine being able to build, segment, launch, and execute a promotional campaign all within a prompt-like interface. This is more than a product launch; it's a strategic shift to an AI-native future. As I've said before, it's not about building tools. It's about owning the workflows so that AI is in the places where we as users are actually living. This new foundation will fuel capabilities like ROI-ranked operational recommendations, voice-enabled ordering, and real-time audience targeting, all designed to make restaurant operations faster, smarter, and more adaptive. As Gen AI becomes embedded in the fabric of enterprise software, we believe the platform strategy is quickly emerging as the key to long-term value. It's not just about building tools anymore; it's about building AI-native workflows. Companies that act as platforms, not point solutions, are in the best position to win. Why? Because they're integrated where work actually happens. That means deeper engagement, better data, and a natural fit for generative AI features that drive real, measurable impact. Moreover, by leveraging tooling and a tool set that you already understand, you lower the bar for training and adoption, a massive issue in today's early AI products. This is exactly where PAR shines. We don't just automate tasks; we connect entire workflows across departments. While point solutions get stuck in silos, PAR brings teams together, streamlining operations, and enabling collaboration at scale. For restaurants, this isn't a nice-to-have. It's the foundation for running a smarter, faster, and more agile business. We feel deeply passionate that AI makes PAR stronger because it brings the value of better together to life faster and improves the ROI of doing more with PAR. We believe it helps create a deeper moat and pulls more of the ecosystem our way.

Thank you, Savneet, and good afternoon, everyone. In Q3, we continued to execute our plan of driving organic growth across our products and the verticals we serve while also driving profit and cash flow improvement, all while ensuring the company has the right resources to execute with excellence on our large Tier 1 opportunities. Subscription services continued to fuel organic growth and represented 63% of total Q3 revenue. The growth from higher-margin revenue streams resulted in a consolidated non-GAAP gross margin of $57.5 million, an increase of $7.4 million or 15% compared to Q3 of the prior year. We managed the growth while continuing to drive efficient leverage of our operating expenses. Now to the financial details. Total revenues were $119 million for Q3 2025, an increase of 23% compared to the same period in 2024, driven by subscription service revenue growth of 25% and inclusive of 16% organic growth. Net loss from continuing operations for the third quarter of 2025 was $18 million, or $0.45 loss per share, compared to a net loss from continuing operations of $21 million, or $0.58 loss per share, reported for the same period in 2024. Non-GAAP net income for the third quarter of 2025 was $2.5 million or $0.06 earnings per share, an improvement of $5.6 million compared to a non-GAAP net loss of $3.1 million or $0.09 loss per share for the prior year. Adjusted EBITDA for the third quarter of 2025 was $5.8 million, an improvement of $3.4 million compared to the same period in 2024. Q3 adjusted EBITDA of $5.8 million included $0.8 million of accounting charges for non-period costs. Removing these non-period charges, adjusted EBITDA would have been $6.6 million and more indicative of our current normalized operating profit. Now for more details on revenue. Subscription service revenue was reported at $75 million, an increase of $15 million or 25% from the $60 million reported in the prior year, and represents 63% of total PAR Revenue. Organic subscription service revenue grew 16% compared to the prior year, when excluding revenue from our trailing 12-month acquisitions. ARR exiting the quarter was $298.4 million, an increase of 22% from last year's Q3, with Engagement Cloud up 16% and Operator Cloud up 31%. Total organic ARR was up 15% year-over-year. As stated in our Q2 earnings call, we expected incremental ARR growth to accelerate from the first half of the year to the second half. During Q3, incremental ARR increased $12 million versus $5 million in Q2 when excluding the GhostSkip asset acquisition, signaling the return to stronger growth momentum, which we expect to continue in Q4. Our growth is being driven by both site growth and increased ARPU, reflecting the successful execution of our Better Together thesis, which is driving both multiproduct deals and cross-selling into our existing customer base. Hardware revenue for the quarter was $30 million, an increase of $7 million or 32% from the $23 million reported in the prior year. The increase was driven by continued penetration of hardware attachment into our expanding software customer base and increased sales volume from customer demand that was pulled forward in advance of anticipated tariff impacts. Professional service revenue was reported at $14.5 million, relatively unchanged from the $14.2 million reported in the prior year. Now turning to margins. Gross margin was $49 million, an increase of $6 million or 14% from the $43 million reported in the prior year. The increase was driven by subscription services with gross margin dollars of $41 million, an increase of $8 million or 25% from the $33 million reported in the prior year. GAAP subscription service margin for the quarter was 55.3%, in line with the 55.3% reported in Q3 of the prior year. Excluding the amortization of intangible assets, stock-based compensation, and severance, the non-GAAP subscription service margin for Q3 2025 was 66.2% compared to 66.8% in Q3 2024. The modest year-over-year decline was driven by the impact of a fixed profit contract that we acquired from one of our 2024 acquisitions. Excluding this contract, which is not reflective of core operational performance, the non-GAAP subscription service margin was over 70% for the quarter, an improvement of 150 basis points versus the prior year. This contract is up for renegotiation in 2027, and we expect that the renewal process will provide an opportunity to improve the underlying economics. Hardware margin for the quarter was 17.8% versus 25.5% in the prior year. The decrease in margin year-over-year was substantially driven by increased supply chain costs resulting from recently implemented U.S. tariff policies. The company began implementing pricing adjustments during the quarter to mitigate the impact of tariffs in future periods. We expect hardware margins to return to the mid-20% range moving forward. Professional service margin for the quarter was 17.6% compared to 29.2% reported in the prior year. The decrease in margin year-over-year was primarily driven by a reclassification of non-period costs from R&D and incentives offered on SaaS implementations to facilitate adoption of recurring subscription revenue streams. We expect professional service margins to return to the mid-20% range going forward. In regard to operating expenses, GAAP sales and marketing were $12.5 million, an increase of $2 million from the $10.5 million reported for the prior year. The increase was primarily driven by inorganic increases related to our acquisitions, while organic sales and marketing expenses increased by a modest $0.7 million year-over-year. GAAP G&A was $31.7 million, an increase of $4 million from the $27.4 million reported in the prior year. The increase was substantially driven by certain non-cash or nonrecurring expenses, of which $3.5 million are non-GAAP adjustments, while organic G&A, excluding non-GAAP adjustments, remained flat year-over-year. GAAP R&D was $19 million, an increase of $1 million from the $18 million recorded in the prior year. The increase was entirely driven by inorganic expenses, while organic R&D expenses actually decreased $0.2 million year-over-year. Operating expenses, excluding non-GAAP adjustments, were $52 million, an increase of $4 million or 8% versus Q3 2024. However, when excluding inorganic growth, operating expenses were flat year-over-year. Exiting Q3, non-GAAP OpEx as a percentage of total revenue was 43.4%, a 590 basis point improvement from the 49.3% in Q3 of the prior year, demonstrating our ability to scale efficiently and drive operating leverage. Now, to provide information on the company's cash flow and balance sheet position. As of September 30, 2025, we had cash and cash equivalents of $92 million and short-term investments of $0.5 million. For the 9 months ended September 30, cash used in operating activities from continuing operations was $15 million versus $24 million for the prior year. Operating cash flow has steadily improved throughout the year as we continue to drive incremental profitability and reduce our net working capital needs. Q3 operating cash flow was positive, with cash provided by operating activities of $8 million for the quarter. Cash used in investing activities was $11 million for the 9 months ended September 30, versus $178 million for the prior year. Investing activities included $4 million of net cash consideration in connection with the tuck-in asset acquisition of Go Skip, capital expenditures of $3 million for fixed assets, and capital expenditures of $4 million for developed technologies associated with our software platforms. Cash provided by financing activities was $12 million for the 9 months ended September 30, versus $279 million for the prior year. Financing activities primarily consisted of the net proceeds from the 2030 notes of $111 million, of which $94 million was utilized to repay the credit facility in full. To recap, following a slower first half, Q3 marked a pivot to meaningful growth and continued incremental profitability for the second half of 2025. This momentum is evident across key financial metrics, $12 million or 17% annualized sequential ARR growth. Non-GAAP subscription service gross margin percent improved 150 basis points from Q3 2024 when excluding the non-operational impact of the aforementioned acquired fixed profit contract. Non-GAAP OpEx as a percentage of total revenue improved 590 basis points from Q3 2024. Adjusted EBITDA improved $3.4 million from Q3 2024, and operating cash flows were a positive $8 million for the quarter.

Thanks, Bryan. In short, Q3 was a strong execution quarter, and we possess the scale, product, subscriber base, and financial strength to lead the enterprise foodservice technology category. What's in front of us are significant business opportunities with major Tier 1 deals, an aggressive acquisition strategy to deliver sustained additional inorganic growth, and a pointed AI product approach. Moreover, our growth into new large TAM industries continues to validate our PAR Advantage, and the investments we're making should bear fruit in years to come. In 2025, we're on track to deliver nearly $450 million in revenue, approximately 2/3 of which is recurring SaaS. We're also driving gross margin expansion, building a solid cross-sell and upsell motion, and seeing results across our global installed base of over 100,000 restaurants and retail stores. The long-term plan is for PAR to be the clear enterprise winner. First in restaurants, later with C-stores, and over time in the next vertical. Being the clear winner in this niche market creates a unique market dynamic that will warrant evaluation commensurate with others who've done similar work in different verticals. We are convinced that this foundation we have built has set PAR OPS to compete for and win the largest Tier 1 restaurant technology deals in history. In the short run, our priorities remain clear. First, continue to grow ARR in the mid-teens organically or higher; second, execute on a unified better together product roadmap while building and commercializing new AI-driven functionality. Third, drive operating leverage and expand EBITDA. And fourth, close and announce large strategic Tier 1 deals to provide further visibility for long-term revenue growth. A critical aspect of our story now is revenue growth visibility. While especially operator cloud product rollouts can take time, given the in-store nature of the deployments, PAR has accrued a very sizable backlog, coupled with a late-stage Tier 1 pipeline. We have a very strong foundation to build off of. In other words, the short-run priorities I just mentioned are just our baseline. This is the minimum expectation I have of our team. Our mandate continues to be to leverage our existing business to pursue more aggressive, accretive, and creative M&A opportunities. This is a buyer's market, and PAR is a proven value creator. Multiples across our sectors have compressed dramatically, allowing for the potential for creative asset acquisitions. More importantly, though, we have the expertise and grit to actually pull it off. Our current flywheel of multiproduct deals expansion is great proof of this. During our time here, we have evolved from an unfocused, hardware-driven, and money-losing business with a singular software product to a profitable platform SaaS company bidding for and executing the biggest deals in the industry. This will absolutely happen again and again. We intend to further consolidate our existing markets while building out the PAR flywheel in new verticals. Our ambition is to be larger and faster, predicated on an ever-expanding better together platform. And this ambition is deeply rooted in every single member of our team. Thanks again for your time and your continued confidence in PAR. We're happy to take your questions.

Our first question comes from the line of Samad Samana of Jefferies.

It's good to see the progress both on the top line and on the expense side. So congrats on that. Maybe first, Savneet, just in thinking about the word record in terms of the pipeline, I think it was described as a tipping point in some ways by Bryan for the business. So the tone is very, very positive. Can you maybe help me understand with a little bit more precision in terms of what changed between Q2 to Q3 that's giving you, I think, what seems like incremental confidence, particularly as you ended the call with that at least mid-teens growth outlook? And then I have a couple of follow-ups.

I think we had similar confidence in Q2. It's just further visibility as we signed more deals that have given us a lot more visibility for Q4 and the rest of next year, and then further progress on these larger Tier 1 deals, where now we see real visibility and hopefully a couple of them; it just gives us more confidence. I think we had similar confidence, but it's rising as we get more and more deals signed. I think the other part is that we rolled out a record amount of revenue this quarter, and our backlog filled back up. And so our backlog didn't come down, which means that we're signing at a faster rate than we're actually rolling out, which I think gives us more confidence again on the visibility in the out years.

And then you mentioned valuations coming down in the space. You mentioned M&A. And I know the company has made a lot of progress in digesting some of the M&A from years past. So just should we take that as a signal that now that you're far enough along in the digestion of TASK and Stuzo Holdings and some of the other assets that you would maybe think about firing that M&A muscle back up again? Or is that more of an opportunistic view? Just help us think through that last comment.

It's opportunistic. What I meant is that while our multiples are compressing, many of the assets we’re interested in have declined even more. Additionally, there are unique opportunities to acquire assets and businesses that we value. Therefore, we plan to be opportunistic while being very cautious about how we use our shares. We are seeing enough favorable deals that it wouldn't surprise me if we identified something. Although there’s nothing immediate on the horizon, we feel confident about our position concerning the multiples we're observing and some of the assets we've been monitoring for several years.

Last question for me, and I'll turn it over. But just there's been, I'd say, some mixed performances out of certain pockets of maybe groups that aren't necessarily PAR customers, but that are representative of what's going on more broadly with consumers. And so I'm just curious if you have seen that it has any impact on customer decision-making, whether that makes it more imperative than ever to have the right technology in place, and/or if it's slowing down deal cycles, or if you're seeing both of those netting out? Just how is some of the recent news or headlines on what's happening in restaurants translating into deal closures for you guys?

Yes. Great question, Samad. So the first half of the year was painful for, I think, our category across the board. We saw a meaningful slowdown in traffic and sales for many of them. We saw it pick back up towards the second half of this quarter. But I'd say categorically, we haven't seen a slowdown in RFP activity. In fact, we have more RFP activity at scale than we had before. Where it impacted us in Q2 was that at the franchisee level, rollouts were slower because franchisees were waiting for business to stabilize. I think that's now reversing, and we're seeing really good momentum. But the macro question is a good one because I think what we continue to see is that as sales volatility exists in our category, the investments in technology seem to be increasing, not decreasing. So we're seeing more excitement around a lot of the AI tooling we have. And I think maybe most exciting for PAR, we absolutely see more interest in consolidating vendors. And we are one of the few players that have, I'd argue, close to a full suite of products. And so I think that's giving us a little wind in our sails.

Nice message, guys. So, specifically to TASK, you had mentioned that last quarter, you had put off some implementations because you were focused on the RFPs. I just want to make sure I understand what the updated message is relative to that.

Yes. I think we continue with the same plan. We've got a lot of test business needs to get rolled out in 2026. And we're moving from RFP to actual development on a larger opportunity. It's critical for us to hold our commitments to our customers to get those deals out in 2026 while also building for this large opportunity.

Now, with respect to 2026, you made multiple points through your prepared comments that there were different things setting you up very well for 2026, AI, the BK rollout, the template for products, etc. Can you just give us a broader sense of what this ultimately means for '26?

Not yet. We're going to give guidance on the next call. But I think maybe the biggest takeaway is we have a lot more visibility now than we've had in the past because of the backlog that we've signed. As a result, I think we can get more precision as we get to the end of the year. And the other part about it is the market, to the last question, part of what we're also learning is that the market likes our strategy. Every single car ordering deal was a multiproduct deal, including payments and loyalty. We're starting to see that the thesis we put out there and now the product execution is catching up. That should give us the opportunity to take a lot more share next year.

Savneet, I'll just nitpick a little bit. You've been saying that you could grow ARR 20% organically for quite some time. I think you said that your target is mid-teens plus. Is there a change in the market? Or do you think this is just a function of the type of deals you're pursuing, which may take longer to land? Maybe that's a good thing long term, but it may slow down the revenue ramp. I'm just curious as to why the shift from 20% organic to mid-teens organic, if I heard your comments correctly.

Yes. So last quarter, we said we're going to target mid-teens. I'm continuing that message here. When I was running through the priorities, it was our short-term priorities, which is continuing to hit at least that and hopefully more going forward. The major delta we're talking about is 2025, where our first half was slower than we wanted. It will be hard for us to get to that 20% for this year. There's an opportunity for us to accelerate in '26 and '27 as I talked about. Right now, we feel really comfortable with mid-teens opportunities to go higher. Given the whole momentum we have in AI and some of these larger deals, we'll see where that shakes out on our next call. We feel really good where we are. More than anything else, I think there's more opportunity for us to get back to where we were on this call than there was last call.

And then, if I could just ask more about the competition. Just listening to Toast and other players in the market, it seems like there's obviously a share shift going on from legacy to the more modern solutions like yours and Toast and other players in the market. I'm just curious, are you starting to see each other now because they're moving upmarket? I know not in the QSR space necessarily, but making some progress in your core enterprise space. I think you've had some opportunities down market. So I'm just wondering if you're starting to maybe see each other more often and what that means for the market overall?

Not as much as you think. I mean, I think we have incredible respect for the team, the business, what they've built. We've been competing in enterprise deals for years. At the large QSRs where we make our bread and butter, traditionally, it's still the same few folks as the incumbency, ourselves, and usually one of the other legacy providers. Today, I think if we surveyed our sales team, it would say the same all. We definitely see each other more in the smaller mid-market part of the world, where they are pushing aggressively. We do see each other there. But the large Tier 1s have unique dynamics when we see them. We think very highly of them, but we feel like we continue to expand our moat, and particularly this multiproduct dynamic is going to help us going forward.

I wanted to clarify your comments around moving from RFP to development. Specifically, I haven't seen any big announcements, but are you alluding to one of the super Tier 1s that you had been targeting and talking about over the past couple of quarters?

We're generally in a market where the press release comes out quite a bit after we've won a deal, unless it's a renewal of an incumbent. So you generally won't see the press release until well later. What I was talking about is that we were in an RFP process, and now we're starting to build. As we get details, we'll share them as we're allowed.

The first question is around M&A. I know you spoke about it, but obviously, your shares are down almost, I guess, 2/3 from where we were in November. I guess my question to you is, would this prospective M&A be accretive to your growth rate? How do you think about doing M&A with your stock down 2/3? I mean, if I look at it on '27 or even '26, you're trading in the teens or whatever, it's 15, 16, 18, 20x EBITDA. How do you think about buying businesses while your profitability is inflecting because in '27, on a revenue multiple basis, you're the cheapest you've ever been, and your profitability is inflecting. So I'm just curious how you think about doing M&A within that paradigm.

Yes. On the call, I think it's twofold. We won't do something that's not accretive. I think we've been very strict about that in everything we've done. While our multiples compressed, we're seeing far more compression in some of the assets we've been tracking for a very long time. Part of that is we think there are some carve-out opportunities that we could leverage. You won't see us do anything close to a big deal. I don't think you'll see us dilute you and ourselves in any way; that's irresponsible. You will see us find niche assets that we can use cash on the balance sheet, or if we use our shares, there's a large margin of safety for us to make it accretive. Historically, that's always been the goal. Day 1 is accretive, and then the opportunity to accelerate beyond that. That's definitely what we want to try to accomplish. Generally, the way our business works, and it's not the same for everybody. After we win an RFP, we get to some form of development. Now it's not a guarantee by any means. You still have to do a lot of work from there, but it's generally a very good sign.

This concludes the question-and-answer session. I would now like to turn it back to Chris Byrnes for closing remarks.

Thank you, Elliot, and thank you to everyone for joining us today. We appreciate your time. We look forward to updating you in the further coming weeks. Have a nice evening.