Digital Turbine, Inc. (APPS) Q1 2021 Earnings Report, Transcript and Summary

Good afternoon. And welcome to the Digital Turbine Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to the speakers. Please go ahead, sir.

Yeah. Thanks Greg. Good afternoon. And welcome to the Digital Turbine fiscal 2021 first quarter earnings conference call. Joining me on the call today to discuss our results are CEO, Bill Stone; and CFO, Barrett Garrison. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements. These forward-looking statements are based on our current assumptions, expectations and beliefs, including projected operating metrics, future products and services, anticipated market demand and other forward-looking topics. Although we believe that our assumptions are reasonable, they are not guarantees of future performance and some will inevitably prove to be incorrect. Except as required by law, we undertake no obligation to update any forward-looking statements. For a discussion of the risk factors that could cause our actual results to differ materially from those contemplated by our forward-looking statements, please refer to the documents we filed with the Securities and Exchange Commission. Also during this call, we will discuss certain non-GAAP measures of our performance. Non-GAAP measures are not substitutes for GAAP measures. Please refer to today's press release for important information about the limitations of using non-GAAP measures as well as reconciliations of these non-GAAP financial results to the most comparable GAAP measures. Now, I'll turn the call over to our Chief Executive Officer, Mr. Bill Stone.

Thanks, Brian, and thank you all for joining our call tonight. I'm going to break my prepared remarks into three areas. First, I want to provide a summary of our first quarter results. Secondly, some operational commentary on the present businesses including some new partnership announcements, and finally, I'll conclude with some commentary about the future. To close out the June quarter, we finished with $59 million in revenue $14 million in EBITDA, and $0.13 of non-GAAP earnings per share. To highlight our progress over the past year, last June quarter, we reported $30.6 million in revenue, $4.2 million in EBITDA, and $0.05 of non-GAAP earnings per share. Our as reported results represent nearly 100% growth in revenues, a 250% increase in EBITDA and over 150% growth in non-GAAP earnings per share. We showcase the inherent operating leverage of a platform. Barrett will take you through more detail on the numbers. But we have had many solid quarters over the past three years. But this quarter was a true breakout quarter for the company against our expectations. It was the best performance in the history of Digital Turbine. Specifically, the revenue growth of our application business grew 45% year-over-year. And our content business, which had a 12% revenue decline year-over-year for the month of March had nearly a 20% growth rate in the month of June year-over-year, as the combination of our swapping out the legacy mobile policy content platform during the April and May months to a new and improved content platform is beginning to show encouraging daily active user results plus improving advertiser rates. For the application business, we saw year-over-year revenue per device or RPD increases of over 25% here in the U.S. and over 50% for International. Demand remains strong, driven by our social media, gaming, streaming audio, and streaming video verticals. We continue to see improving conversion rates on our applications, which leads to higher bid rates as consumers are increasingly engaging in the applications we deliver. We are also starting to see new device growth especially here in the U.S. rebound in growth from earlier in the year. The dynamic that our sequential device penetration grew to over 43 million devices in the quarter, while the broader smartphone market declined by approximately 20% showcases how much room we have as a penetration story against the broader opportunity. Turning to the operations, our growth levers of devices, products and media are accelerating the growth rates across the board. Regarding devices, I'm excited to announce the expansion of our platform to power over the top TV streaming. Specifically, we anticipate launching our software platform across all the major U.S. mobile operators, including T-Mobile, AT&T and Verizon. As many of you know, the U.S. operators are launching over the top TV offerings to complement their existing offerings. We anticipate that our software will be assisting in powering the applications and management of the content on these devices, ranging from delivering the content, advertising notifications, and ultimately may include cross device integration in the living room. These launches should deepen our existing relationships with AT&T and Verizon. And also should represent our first device launching with our Ignite software on the combined T-Mobile Sprint entity. Launch stage will vary depending upon operator. But we expect the first operator to launch this calendar year with our software. And then we'll be expanding with others in 2021.This is a nice proof point of the value add of our mission, which is to connect the dots between all the people who want to be on the devices to the devices themselves. I want to emphasize that this is not just about the TV opportunity and new device types. But more importantly, it's a proof point of the depth and breadth of the relationships we have with our U.S. operator partners. We've also made additional international progress. Our Samsung relationship continues to scale with 13 million devices added in the June quarter. This compares to a 130,000 devices and the June quarter of a year ago. We're also pleased to announce new supply relationships with both Telecom Italia and Nokia that will launch later this calendar year, to complement our recently announced relationships with Telefonica, Xiaomi, LG and AT&T Mexico, that are all in various launch phases right now. Our international device momentum is accelerating and combined with a television opportunity and 5G U.S. launches make us bullish on our ability to continue to grow device volumes. On the product front, our diversification efforts continue to showcase momentum. Our dynamic install business grew by over 40% year-over-year, but today is approximately 60% of the revenues, which compares to 85% a year ago. Our content businesses now over 35% of our revenues, and I'm pleased to announce our first of hopefully many cross-selling wins from our Mobile Posse acquisition, as we launch our first content media offerings with Tracfone and Blue here in the United States and Latin America. We expect continued revenue synergies in the future as global momentum is strong. I'm really excited about the total addressable market for a content business. Today we're generating approximately $15 million a quarter across over 8 million daily active users or DAUs. And as we grow DAUs with our existing partners and expand the DAUs to our other distribution partners, that growth should be a catalyst to continue top line growth for years to come, given the recurring nature of these revenue streams. And today, our overall recurring revenues are now over 35% compared to 5% a year ago. Turning to other products, as recently as March, over 90% of our SingleTap revenues were derived from our social media platform integration with one of our Tier 1 U.S. operators. That revenue has been relatively consistent over time, but is now roughly only half have our SingleTap revenues as we've begun scaling SingleTap with many other partners, as well as scaling our own SingleTap demand side platform. As a result of these efforts, our SingleTap revenues have doubled since the March quarter and for a non-social media platform integration, SingleTap revenues have already surpassed in the September quarter what they achieved in the June quarter. It's still not as material as we believe it can be, but the trajectory is becoming more meaningful each day, with some very strong momentum behind it. On the media side, we've signed a master service agreement with T-Mobile's advertising team and anticipate distributing their brand relationships with names like Shell, Nike, Walgreens, and so on, onto our platform. And as you've heard me say on prior calls, continuing to diversify our channel relationships on the demand side of our business is a key driver of growth. And this is a nice proof point of our expanding team over relationship and our expanding channel reach, which scales our global demand. We continue to leverage our other global relationships as showcased in our results. For example, we're seeing Asian demand growing on U.S. supply and LATAM supply and are seeing our U.S. demand grow on our LATAM and Asian devices and so on. Global scale brings more global scale, and the global scale of these deeper media relationships with global companies like Alibaba, TikTok, Pandora, King, Snap, Zynga and so on, is paying dividends against our global supply. Turning to future, I've never been more optimistic about our prospects. We have the right product to the right customers at the right time. And equally important, as a mobile cloud software company, the global scale and operating leverage flywheel is now in full effect. We're laser focused on increasing our device footprint, product diversity and global media expansion. The combination of all three of these things is what creates platform network effects that we are seeing evolve real time in our results. We'll look to continue to horizontally expand to additional supply partners, and also look for opportunities in our content business, to vertically integrate our offerings that should create additional margin enhancements and increased recurring revenues. And last, but probably should be first, it is a shout out to our DT team. The past few months have been traumatic at a macro level for all of us. Lives are being disrupted, but our team remains focused, committed and is hustling to deliver results in a virtual environment. And sometimes when we hear people are the difference, many here may roll their eyes sounds like a platitude or cliche, but in this case, a fact. The global team is a team I've never been prouder of in these challenging times. And for investors, I can't emphasize enough the power of having an all-in team that's busting their tails to execute on the vision. As teams lean in delivering approximately $1 million of revenue per employee per year, which is world class performance, with very few companies anywhere that can claim that kind of efficiency. And with that, let me turn it over to Barrett, to take you through the numbers.

Thanks, Bill, and good afternoon, everyone. We're very pleased with the results delivered in the quarter and off to a great start to our fiscal year. First of all, we're excited to be reporting our first full quarterly results of our content business now included with my recent acquisition of Mobile Posse. To help provide additional insight into the underlying trends of our business when comparing current performance against prior periods, I'll be occasionally referencing results on a pro forma basis where appropriate. In the quarter, revenue of $59 million was up 93% as reported and 28% on a pro forma basis. This accelerated rate of growth is driven primarily by our applications media business, which revenues of $44.2 million represented 45% growth in the quarter. Revenue growth in our apps business continues to be driven by strong demand on the platform, and RPD on our U.S. based partners increased 27% year-over-year, and revenues on our international business grew more than 200% in the quarter. Gross profit, a key financial performance metric grew 118% to $26.7 million in the quarter, which was up 36% on a pro forma basis. Gross margin on the platform was 45% in Q1 up from 40% in the prior. This impressive margin expansion was largely driven by three factors. The integration of our high margin cost media business, continued margin improvement on our apps business. And lastly, we received a one-time positive benefit related to a revenue share partner on our apps business, which had a non-recurring benefit to gross margin and gross profit of about 200 basis points. While gross margin rates can fluctuate from quarter-to-quarter, we anticipate further margin expansion as we continue to execute on our product and partner diversification strategy. We experienced continued impressive expense scale on the platform, as cash expenses excluding onetime transaction costs were $12.6 million in Q1 or 21% of revenue, down from 26% of revenues in the prior year, and increased only 2% year-on-year on a pro forma basis. Total operating expenses were $15.5 million which included onetime transaction costs of $0.3 million compared to total operating expenses of $8.9 million in the prior year. I will note, that our operating leverage is being achieved even as we make a number of focused investments, primarily within our sales force and technology teams to support new partners and products to drive future incremental revenues on the platform. These growth investments are being partially offset by cost synergies realized from the integration of our recent Mobile Posse acquisition and other realized cost efficiencies. I'm especially pleased with our non-GAAP adjusted net income or cash earnings in the quarter of $12.5 million or $0.13 per share, as compared to a $4.2 million or $0.05 per share in the first quarter of last year. Our GAAP net income was $9.9 million or $0.11 per share, based on $93 million diluted shares outstanding compared to a first quarter of 2020 net loss of $1.8 million or $0.02 per share. Moving to the balance sheet, we exited the quarter with $18.7 million in cash and generated $4 million in free cash flow from operations in the quarter. As I discussed in the March quarter, we were positively impacted in that quarter by the timing of certain partner payments and also the timing of these working capital areas partially reduced our cash balance and free cash flow on a sequential basis. And we expect these to be at normalized levels in the September quarter. Also, as a reminder, the June quarter includes our first of four quarterly earn out payments, which was approximately $6.8 million paid in Q1. We exited with a $20 million balance on our recent term loan facility. Now, let me turn to our outlook. We currently expect revenue for Q2 to grow to between $59 million and $61 million, expected adjusted EBITDA to grow to between $11 million and $12 million and adjusted net income per share -- diluted share to be between $0.11 and $0.12. With that, let me hand it back to the operator to open the call for questions. Operator?

We’ll now begin the question and answer session. [Operator Instructions] Our first question comes from Tim Horan with Oppenheimer.

Thanks guys, and congratulations. Can you give us a little bit more color on the growth in revenue per device, maybe what drove that, which is pretty phenomenal and how sustainable is that? And then secondly on Mobile Posse, only 8 million subscribers here, any aspirational goals what that can be in a couple of years and maybe just a little bit more color how those conversations are going? Thank you.

Yeah. Thanks, Tim. Let me start on the second question, and we'll hit the RPD one. On the Mobile Posse side, when we talk about daily active users north of 8 million, if we look at monthly active users, it's many, many tens of millions. We're using daily active users is a metric, just as something it's synonymous with industry names that many of us are familiar with. But with that being said, we're very optimistic about the broader total addressable market here, and just given the recurring nature of those revenues. And, we announced Tracfone as our very first product here today and we’re optimistic about more to come. And so that'll be something that we really think will expand the DAU opportunity for us in the content business for years to come. So, we're really excited about that. On the RPD front, yeah, there’s really kind of two drivers for RPD. The first one was, is really around just media partner spending more money, and bid rates going up as a result of consumers engaging more with the applications. And so, we continue to see really strong engagement with the applications that we put on customers phones and that's encouraging. And having better conversion rates leads to higher bid rates leads to more people coming on the platform, and all those things melt up. So, that's a very good thing. And then secondly, is new product growth. In the app business, we also are seeing revenue per device grow up from things like SingleTap and notifications and our out-of-the-box wizard experience and so on. And so, our actual revenues on those new products in the app business actually doubled year-over-year. So we're pleased with that growth. We think we've got a lot more gas in the tank on those new products. We're putting a lot of energy into those, SingleTap in particular. But those are the two drivers of the improvements in RPD.

Thank you.

Our next question comes from Darren Aftahi with Roth Capital Partners.

Hey, guys, thanks for taking my questions. Nice quarter and nice outlook. Few things here, Bill, can you talk a little bit about the what you did under the hood, both on the ad side and then just structurally with Mobile Posse? It sounds like you changed some things in June. So looking at that question kind of one, what do you actually do? And then two, if you kind of compare ad rates maybe exiting the quarter, I'm curious how those compare on the programmatic side relative to maybe February rates with Mobile Posse, even own at the full quarter? And then I've got a couple of follow-ups.

Yeah sure. So on the content business side, I want to first give a shout out to the Mobile Posse legacy team here and John Jackson, the founder. They had begun basically a lift in replace of their platform, a year ago. And now, we're getting the benefit of that and the hard work that that team has done over the past year. And we basically spent the June quarter getting into place. And the specific benefits of that are improved deal ability metrics, improved engagement and options on driving daily active user growth. And all those things contribute to the revenue comps I referenced of comparing our June results in that business this year to last year, showing nearly 20% growth compared to March and earlier months were your double-digit decline. So that's partially due to the hard work to do a lift in replacement platform. So, great job by the team there, to make that happen. And then secondly, is we are seeing a broader rebound in programmatic rates. So, yeah, I think we hit a real trough there at the height of the pandemic. And in March in April, we weren't as impacted as perhaps some other names out there were. But nevertheless, in the content business, there was a little bit of that. We're starting to see that rebound and come back to more normalized levels. So in the combination of good execution and rebounding advertising rates is driving nice double-digit growth in that business.

And then on the opportunity for cross selling the content business in the other carriers, the Tracfone news is great. I'm just kind of curious where your confidence level lies with some of your other legacy carrier partners? And then, whether you feel like you can get any of those partners across finish line before the year is up?

Yeah, so I'd say that, overall kind of taking a broad brush view we’re extremely optimistic. And one of the things I really wanted to highlight in my comments, and I'll do it again here in the Q&A is I think a lot of investors have thought about the Mobile Posse acquisition, in terms of us getting our technology onto their distribution. And obviously, that's important and we're working on that. But I think the other opportunity perhaps hasn't gotten the same amount of focus is, what's the total addressable market, given that we're on 400 million or 500 million devices, to expand those content offerings onto the other side. And so, want to highlight some proof points, again, some traction there. Not going to make any commentary like, hey, this is going to show up in the September quarter, or the December quarter or anything like that here. But I'm saying that we are pretty optimistic about get some traction on two additional distribution partners.

Great. And then I guess lastly for me on SingleTap, it sounded like that was pretty strong. I'm just kind of curious beyond kind of your social media and carrier platform you've worked where it's driven a lot of the revenue. What other partners kind of helped lift that number sequentially, was it some of your attribution partners, new direct customers, and kind of how do you feel about the outlook going forward into the rest of the year? Thanks.

Yeah. Great. Thanks, Jerry. Yeah, so on SingleTap side, it's across the board. So we're going to continue to expand our relationship with our MMPs. We're going to continue to expand with other third parties. And we've talked about many of those on prior calls of the Pinterest and Twitter's and names like that as well as many others. But I think the real thing that we figured out here is, having SingleTap here on DSP, in other words, vertically integrating SingleTap and taking it direct. So, for example, if we've got a great relationship with Pandora, and you're listening to Pandora on your phone from something that we put on your device, now enabling SingleTap with the advertising that we actually buy now on Pandora. And then we keep monetize via the app install through SingleTap, because that's a real differentiator that other people in the marketplace can't provide, other DSPs can't. So I think, that's something that we're seeing some really nice growth from and because we actually control the whole stack, we can also work a lot on the operational issues and scale issues that are behind it. So that's really been a big driver for us and something that we're going to look to continue to invest in.

Great, thank you.

Next question comes from Anthony Stoss with Craig-Hallum.

Hi, guys. My congrats as well on just the outstanding execution and momentum. Bill, maybe can you go into further detail on the over the top streaming platform? You talked about T-Mobile, Verizon and AT&T. How big of opportunity that is for you if you've engaged with some of your international customers on that so far as well? And just any view you have on that in terms of either hardware partners, or what else you need to expand that into the business aggressively?

Yeah. So as a couple points, I want to make around the television business. Obviously, one is that, what's the opportunity of these devices themselves. And I don't necessarily see that being a material opportunity for our business in the September or December quarter. I think it's going to be more of a 2021 thing as those things begin to ramp in scale. But, in a world where I hear concern around declining smartphone growth rates, I think it's important to showcase the dimension of our platform to be able to support additional device types and additional types of screens as growth catalyst. So, that's kind of one bucket. The second bucket though, is one I really want to highlight in my remarks and again here is talking about the breadth and depth of our relationship with our U.S. mobile operator partners. And we talked about how high the barriers to entry and sometimes time to revenue is to get going with these guys. But once you're in there, and you establish credibility, and you build trust the breadth and depth of those continue to grow and expand. And I think this, today is really about highlighting how much they put trust in us on very high-profile things to manage, some things that are going on behind the scenes with all the applications and content that they're delivering on these devices. And then we'll continue to work our pipeline. We don't think we're done here with just these announcements today. There's plenty of other things in conversations that we're having, but nothing that we want to discuss in detail today.

And there is a follow up, if you wouldn't mind talking about the international RPD versus the U.S. RPD where you see international going in and I guess longer term where you think it caps out if it does for your business?

Yes, one thing is about our international RPD, I was really, really pleased to see the strong growth rate year-over-year. But it's not where we need to be. More behind, if I look at, if I wouldn't take like kind of percentage of GDP of Brazil or India or Europe compared to the United States, we should see that similar in RPD. We're not there yet. We got a long way to go. And that's an execution issue on our side. We're highly focused on it. Right now in terms of, more channel relationships, more direct sales force, more self-serving automation to really drive improved performance. So, I don't want to throw the baby out with the bathwater here. We're seeing, really nice, kind of 2, 3X plus growth in international business year-over-year but, I want to see 7 or 8x. And we've got some work to do the opportunities there. We've got to go execute on it.

Thanks, Bill. Congrats again.

The next question comes from Austin Moldow with Canaccord.

Hi, thanks for taking questions. Can you dig more into the revenue growth you saw in the quarter? Where primarily did the upside come from numbers what you were originally expecting?

Yes. So, Bill touched on a few a few points in his -- more in his remarks. One, we introduced some new tech platform on our content business that we've been working on related to Mobile Posse. That had better than expected performance in the June quarter or in the month of June towards the back end. And then, I would say we saw some rebounding and continued steeping in the trajectory of our RPD, really across all regions on our apps business. So, as we felt comfortable with the early part of the quarter, we saw it really exit with shrink Austin and that kind of clicking on all levels.

Okay, got it. Thank you. And the second question is in the press release, you mentioned benefiting from shifting spend towards performance marketing channels. I guess you've been one of them. Where's the spend coming from primarily, competitors’ different sort of ad-formats do you have any kind of read on where you're taking some of that spend from?

Yeah, I don't know if I've got any commentary on specific other ad-formats or other platforms. What I would say, though, is that because we have less exposure to some of the macroeconomic areas that are been hit in the pandemic, like restaurants and travel and automobiles and things like that, that something insulates. So, we're seeing growth in things that are people doing on phones, listening to music, watching videos, doing social media, playing games, those are all things that there people do. And given also in the macro world, there's a lot of concern from advertisers around things like editorial adjacency in terms of where your ads, show up. Everything we do is direct. There’s also a concern about fraud, there's zero fraud on our platform. Those are all important selling points and, in a world, where many people are getting marketing budgets cut to be able to show direct results of the advertising spend that are putting on our app platform is something that's highly attractive to advertisers. So, I think those are really the things that we're seeing coalescing around the improved performance.

Got it. And last question is, can you just give an update on your Telefonica rollout?

Yeah, we're just in flight right now. It's been a little bit slower Austin than I would have liked. We're just getting right now started in the UK. We expect to start in Latin America here, imminently and then expand to some other countries throughout the calendar year. We say that, combination of just Digital Turbine, Telefonica, the local Telefonica, the global Telefonica, and Samsung, all trying to coordinate a lot of moving parts in a COVID environment. This taken us a little longer, but we're now getting out, we're getting live and starting to see some positive things happen.

Okay, great. Thanks for taking my questions and congrats.

Thanks, Austin.

The next question comes from Lee Krowl with B. Riley FBR.

Great. Thanks for taking my questions and echo similar thoughts. Congrats on a really well executed quarter. Two questions; first one, as it relates to the guidance are there any assumptions built-in in terms of the growth rate for one-off drivers like the Facebook boycott the iOS transition? Or perhaps, the early stages of the upgrade of the 5G cycle?

Yeah. Hey, Lee. No, I mean, a broader comment on that would be, we look at what we can control and what we have visibility to and we don't have any broader assumptions around changing and some of those factors, nor do we have an assumption around pent up demand driving increased devices from 5G or other catalyst. We've typically looked at what are the trends we've seen seasonally? What are the trends we're experiencing currently and roll those into how we've derived our guidance?

Got it. And then my second question is around gross margin. It seems like 43% is where kind of a normalized target is when you exclude the one-time dynamics of Q1. Is that the right way to think about gross margin going forward? Or are there any inputs that could perhaps drive higher as we go into the second half of the calendar year?

Yeah, I think that's in the right range, Lee. I think low 40s as we talked before, and as I've tried to emphasize, those can move up and down depending on different product growth and different partner expansion. But that's the right range. The inputs are how quickly do products like the trajectory we're seeing in SingleTap and other products that may have a creative margin profile. But as we think about over the course of the year, that low-40s is probably the right target. The other driver is, the rebound and continue growth in our content space, which we've been energized by their recent performance.

Great. Thanks for taking my questions, guys.

[Operator Instructions]. The next question comes from Jon Hickman with Ladenburg.

Can you guys hear me?

Yes Jon, I hear you.

Okay. My congratulations on the quarter and I was wondering, you said something Bill, in your prepared remarks that I didn't catch clearly. You were, just before you start talking about SingleTap, you mentioned the, I think it's an acronym DAU's, you're talking about your content. What is the DAU?

Yeah, so the DAU is a daily active user. So when we think about our…

Okay. Got it. Okay, thank you. I appreciate that. So could you maybe elaborate a little bit on how the TV product might work? So AT&T decides to stream television content over the top. And they go to some Samsung TV. And Samsung has the Ignite software on the TV. Is that how that works?

Yeah, I think what you see, without talking any details about any of our operator launches, I'm sure they don't want me commenting on exactly what they're going to do. But, in kind of concept for everybody is that you basically have a stick or a box. They kind of plug in HDMI into your television set. That box or stick would have our software running on it. And then, basically what it would do would be manage all the applications that are seen. The delivery, the notifications, ultimately support advertising on the television, ultimately be able to support cross device integration. So in other words, my Netflix that's on my phone or content that may be on my phone that we deliver and how do I get that seamlessly integrated with what's going on in my living room. Those kinds of things are really how we envision the offering. And the operators will decide which features and functionality they want to take advantage of.

Okay. So you don't envision the software on the television itself from whatever --

Yeah, definitely as we want to look at -- if you're if you think about our business in the early days on mobile phones, we started with operators, we started with Verizon, we started with AT&T and then as we went forward in time, you saw us expand to OEMs like Samsung, like LG, like Motorola and so on. So very much, so we could look to expand this to televisions themselves without it being a stick or an HDMI cord in. So it can go either way. There's nothing magical about that. Some of those television manufacturers use different more proprietary operating systems. So there's a little bit of a nuance there. But anyway, with all that being said, is going directly to television is something we absolutely can pursue.

Okay and Bill, just one question for you. It looks like or it sounded like when you were giving the pro forma numbers in your prepared remarks that the pro forma like X without Mobile Posse was in the kind of mid-20% range. Is that a fair assumption?

Yeah, let me clarify those points I've been making. The application business without the Mobile Posse acquisition grew about 45% top-line year-on-year so apples-to-apples. And then we shared as if we owned Mobile Posse this time last year on a comparison basis, the revenue for the combined entities grew 28% year-on-year.

Okay. Thank you. Appreciate that.

Thanks Jon.

This concludes our question and answer session. I would like to turn the conference back over to Bill Stone for any closing remarks.

Great. Thanks, everyone for joining the call today. We look forward to reporting on our progress against all the points we made on today's call. And we'll talk to you again on our fiscal 2020 second quarter call in a few months. Thanks, and have a great night.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.