Weave Communications, Inc. (WEAV) Q4 2022 Earnings Report, Transcript and Summary

Greetings and welcome to the Weave Communications Fourth Quarter and Full Year 2022 Earnings Conference Call. [Operator Instructions] And as a reminder, this conference is being recorded. It is now my pleasure to introduce to you Mark McReynolds, Head of Investor Relations. Thank you, Mark. You may begin.

Thank you, John. Good afternoon and thanks for joining us for our fourth quarter and full year 2022 earnings conference call. Joining the call today are Brett White, CEO and Alan Taylor, CFO. Brett will open the call with an overview of Weave’s performance and strategy and Alan will discuss our financial results in more detail. After the prepared remarks, we will take questions. Today’s discussion contains forward-looking statements that represent our beliefs or expectations about future events. All forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from the forward-looking financial statements. Please refer to the cautionary language in the earnings release and in Weave’s filings with the Securities and Exchange Commission, including our most recent Form 10-K and 10-Q for additional information concerning factors that could cause actual results to differ materially from the forward-looking statements. We will also discuss financial measures that do not conform with Generally Accepted Accounting Principles. For the sake of clarity, unless otherwise noted, all numbers we talk about today will be on a non-GAAP basis. Information maybe calculated differently than similar non-GAAP data presented by other companies. A reconciliation between these GAAP and non-GAAP financial measures is included in our earnings press release, which can be found on our Investor Relations website at investors.getweave.com. And with that, I will turn the call over to Brett.

Thank you, Mark. Good afternoon and thank all of you for joining us today. I will start my remarks with a review of our results for the year before providing a broader company update. I am pleased with our fourth quarter performance and how we closed out the year. We generated revenue of $142.1 million in 2022, a 23% year-over-year increase and above the high-end of the initial guidance that we gave at the beginning of the year and also above the high-end of last quarter’s guidance. We continue to make significant progress on the path to profitability throughout the year. For example, if we compare Q4 2022 to the same quarter in 2021, we improved our gross margin by over 900 basis points and we improved our operating margin by over 2,200 basis points. Our operating loss for the year was $31 million, a 15% improvement over last year and over $5 million better than the high-end of the guidance we gave at the beginning of the year and $2 million better than the high-end of the guidance we gave in November. Our customers have proven to be very resilient in the midst of a challenging macro environment and we saw demand for Weave increase in the second half of the year as healthcare providers sought out our high ROI solutions to make their operations more efficient. I want to sincerely thank the Weave team for their outstanding work in serving our customers and delivering these results. We have many reasons to be optimistic that 2023 will be a positive momentum building year. But first, I want to look back and share some of what we learned in 2022. We made a number of changes to our go-to-market motion and organization at the beginning of 2022, which when combined with the increased employee attrition from the great resignation, particularly in our sales organization, put us in a place where we had fewer ramped sales reps in early 2022 than we had in Q4 of 2021. Additionally, one of our most important sources of sales leads had historically been in-person events. And due to the COVID-19 pandemic, we had very few in-person events from early 2020 through the first half of 2022, more than 2 years. These two factors resulted in a challenging first half of the year and a slowing of new customer additions. In the second half of the year, we began to see improvement in a number of key areas of the business. The number of ramped sales reps increased by nearly 60%. We attended more in-person events in the second half of 2022 than in all of 2021. The number of leads steadily improved. The number of new customer additions and the average sales price for new customers increased. And lastly, business efficiency initiatives improved both gross and operating margins dramatically compared to the prior year. By Q4, we had cut our operating loss by more than half from Q1 and Q2 of 2022. In Q4, we also finalized the most robust annual planning process we have ever completed at Weave. The output of that work was a 2023 strategic plan that aligns us around four focus areas in our business: accelerating revenue growth, building a scalable foundation for profitable growth, delivering an experience that turns customers in the champions and fostering an effective and engaged team that lives our values. This detailed plan was rolled out company-wide in January and builds upon the green shoots we experienced at the end of Q4 carrying that momentum into 2023. I want to briefly touch on our plans for each of these focus areas. As I mentioned last quarter, our revenue model is like a big flywheel that you need to continually impart energy upon to accelerate rotation. Our challenging first half resulted in our year-over-year revenue growth decelerating in 2022. As I noted in my earlier remarks, the second half of 2022, we saw important improvements in key areas of our business, and as a result, we expect revenue to continue to grow sequentially every quarter in 2023. In regards to our scalable foundation for profitable growth, we are intentionally configuring the business for efficient growth in 2023 and beyond with a constant eye on the macro environment. We have built our plans for 2023 to accelerate our path to profitability and we expect to exit the year with positive free cash flow. While we recognize that accelerating our path to profitability may negatively impact revenue growth in 2023, given the uncertainty around macro environment, we believe it is a prudent action to take at this time and we continue to actively monitor the environment throughout the year. Our third focus area is delivering an experience that turns customers into champions. Customer churn has remained stable throughout the year as reflected in our consistent gross retention rate. For the small number of customers that do leave our platform, one of the reasons is that they want to move to a lower cost solution offered by other vendors. We had close to 100 customers returned to Weave this year after leaving for a competitor and nearly a quarter returned within the same month of leaving. These returning customers are consistently validating our belief from the very beginning that what they really need is a high-quality solution that delivers real, immediate and measurable business value that makes their office more productive and their patients happy, not a cheap solution. We continue to receive recognition and validation from our customers that our platform delivers best-in-class communication and engagement results. In Q4, Weave was recognized with key industry awards from each of our three core verticals. In 2022, we doubled down on customer experience, so we saw significant improvements in our customer NPS score throughout the year. We accomplished this through creating an excellent customer experience, delivering feature improvements requested by our customers and increased intention to new integrations. We added new integrations to practice management systems within our core verticals during the quarter and we are focused on continuing to execute our integration playbook in 2023 as we deepen our penetration into our core markets. Our product and engineering teams delivered several important platform improvements in Q4, including the launch of Phone Reporting Analytics for our multi-location customers and a more integrated online scheduling feature to give offices flexibility in scheduling different appointment types and providers. Our fourth focus area is one critical to our success, fostering an effective and engaged team that lives our values. An effective and engaged team translates positively into customer satisfaction and customer retention. I am happy to share that Weave continues to be recognized for our outstanding company culture and our diversity, equity and inclusion efforts. In Q4, we were named a Top Workplace by Salt Lake Tribune, we are the only Utah-based company honored nationally for our DE&I practices. Receiving local recognition is important for us as we aim to attract and retain the best talent. I am proud of what we have accomplished in Q4. 2022 was a challenging but pivotal year for our business. We made a lot of important progress towards configuring our business for growth and success and have taken significant steps to improve our efficiency. I believe that we are setup well to build momentum in 2023 as we continue investing for future growth while remaining focused on delivering strong operational performance. With that, I will turn the call over to Alan to review our financial results and outlook. Alan?

Thanks, Brett and good afternoon, everyone. I’d like to start with a brief recap of the full year results. In 2022, total revenue grew 23% to $142.1 million. Subscription and payments revenue grew 25% to $136.6 million, with improved unit economics and operating margin improved over 900 basis points. I’d like to take a moment to thank all of our team members at Weave, our customers and partners for their contributions throughout the year. We delivered fourth quarter revenue of $37.7 million, reflecting 18% growth year-over-year. This represents 3% or $1.2 million over the midpoint of the range we provided last quarter. Subscription and payments revenue grew 19% to $36.2 million. The year-over-year increase was primarily driven by new customer additions over the last 12 months. As we discussed last quarter, we ended the relationship with our third-party digital forms provider in August of 2022. We now offer our customers a more fully integrated Digital Forms product built by Weave. We have seen positive adoption by our customers and recurring revenue for our Digital Forms offering increased over 85% year-over-year. The transition negatively impacted net revenue retention and revenue growth in Q4 as it will take some time for our in-house Digital Forms product to fully replace the partner product revenue. Our net revenue retention rate was 99% in Q4. However, excluding the impact of the third-party forms provider, NRR remained over 100%. Our gross revenue retention rate remained consistent at 94%, where it has been for the last five quarters. This demonstrates that our customers remain stable and avid users of the Weave platform even in the midst of the macro uncertainty. Moving on to our operating results. As a reminder, I will be referring to non-GAAP results unless stated otherwise. Our Q4 results showed consistent improvement across the board. Gross margin was 67%. This represents a 16% improvement year-over-year. We have taken steps to rationalize our discretionary spend and streamline our operations. Operating expense was $29.4 million, approximately a $490,000 increase from last year compared to a $5.8 million increase in revenue for the same period. We made a considered focus on operating discipline in the second half of 2022. We expect to refine this approach to support scalable growth going forward. Our operating loss was $4.2 million, an improvement of roughly $6.4 million or 60% compared to last year, representing a $2.8 million beat over the midpoint of the range we provided last quarter. The corresponding operating loss margin of 11% is a significant improvement from the operating loss margin of 33% last year. Our net loss was $3.7 million or $0.06 per share in the fourth quarter based on 65.6 million weighted average shares outstanding. This is compared to a net loss of $11 million or $0.26 per share last year. Adjusted EBITDA loss was $2.4 million, a $7.3 million improvement year-over-year. EBITDA loss margin of 6% is a significant improvement compared to the EBITDA loss margin of 30% reported a year ago. We continue to have a very strong balance sheet with $113.3 million of cash and short-term investments on hand as of the end of the quarter. We have plenty of liquidity. And as Brett mentioned, we plan to exit 2023 with positive free cash flow. Looking forward to 2023, as Brett discussed earlier, Weave made a decision to accelerate our path to positive free cash flow while taking a cautious approach to our revenue guidance. We have been managing our spend and the growth in operating expenses has trended down from 40% in 2021 to 17% in 2022. We expect less than a 5% growth in operating expenses in 2023. We believe accelerating our path to profitability while continuing to build for future growth is the optimal decision, especially as companies are operating in an environment of high interest rates and macro uncertainty. We believe our guidance appropriately incorporates the macro challenges we see in the market. For the first quarter of 2023, we expect total revenue in the range of $37.5 million to $38.5 million and non-GAAP operating loss in the range of $5.5 million to $4.5 million. For the full year 2023, we expect total revenue to be in the range of $156 million to $160 million. We expect our full year 2023 non-GAAP operating loss to be in the range of $21.8 million to $17.8 million, which assumes continued progress on our path towards profitability. We expect to have a weighted average share count of approximately 68 million shares for the full year. With our leading all-in-one customer communication platform and our improved go-to-market model that’s showing increased leverage, we believe we are well positioned to capture the large market opportunity ahead of us. Looking forward, we are confident in our ability to drive another year of consistent revenue growth as we drive towards positive free cash flow exiting 2023. Now, Brett and I will take your questions. Operator?

Thank you. [Operator Instructions] Our first question comes from the line of Alex Sklar with Raymond James. Please proceed with your question.

Great, thanks. Brett, I want to follow-up on one of your prepared remarks comments on the pickup in live events. I appreciate the color already on the second half of ‘22 being greater than 2021, anything you can share in terms of the number of touch points you are looking at over the course of 2023 versus is that getting back to pre-pandemic level? And I know you have some other maturing digital motions, but how should we think about live events in terms of kind of overall contribution to your pipeline growth? Thank you.

Sure. Thanks, Alex. So we saw live events pick up meaningfully in the second half, Q4 was strong. We were expecting live events to continue to pick up in ‘23 and we are planning on investing around those. We are also probably attending more events than we would have traditionally, because we have just gotten better at bringing leads out of the events both sales at show and then sales after the show, so following up on leads, but we are still not back to kind of pre-COVID levels yet. And I don’t think we are planning on that for ‘23 quite yet.

Okay, great. I appreciate that color. And then Alan, I guess, one for you as we think about kind of what you are embedding in the growth outlook as far as location growth versus NRR improvements, I get you are lapping some of the forms headwind. But any help on kind of how we should think about that split for 2023?

So Alex, you saw about a 14% growth in location count in 2022, although we are not guiding to location growth there. I do think that we are going to see some consistent quarterly growth, as Brett mentioned, we see sequential growth quarter-over-quarter. We exited the year with the highest growth that we saw in all of last year and we anticipate that continuing. So right now, those signs and the trend lines are good on that score.

Okay, great. Thank you, both.

And our next question comes from the line of Parker Lane with Stifel. Please proceed with your question.

This is Matthew Kikkert on for Parker. Thanks a lot for taking my questions. I want to start on net dollar retention that dropped below 100% on the quarter. Do you have any long-term targets around NDR and what are some paths that you think you could take to increase that over time?

So thanks, Matthew. The NRR, as you mentioned, excluding the impact of the digital forms provider would have still been above 100%. The calculation for that is a trailing 12 months. So it takes a while to turn that thing around. But we do have plans in place both on our roadmap and on our payments solution that we will begin to address that as we go throughout the year, but it’s not going to turn around immediately just given some of the drag from the previous quarters and the digital forms provider. But the – we have introduced new products. We have got our own digital forms product. We have got our payment solution where we are emphasizing both growth in customers, growth in our processing volume and expansion in our net yield. All of those things are areas of focus that we believe will continue to help us bring that net revenue retention level back up. I would just add one other thing on the net revenue retention and that is we, as a SaaS business, we charge our customers on a location basis. We also tend to land pretty heavy in these customers meaning that they buy our kind of high-end solution. And so from that standpoint, we are a little bit different than a subscription model, where there is new subscribers being added as businesses grow back following the pandemic or the recession, but we still look forward to improving that net revenue retention by the means that I just discussed on product and on payments.

Got it. And then I wanted to dive a little bit deeper into the payment solution that you mentioned on that answer. What’s the traction been like for that product and how are adoption rates varying by vertical? And are you making any new investments there in 2023?

So the adoption rate is good. We continue to prove out new means of going to market there. We are seeing processing volumes increase. We are also seeing on a per location basis. We have also been working hard to improve our net yield. And I think that we have made – we will continue to make good strides on just improving the integration of the payments business with the overall communication tools that we provide that provides a competitive edge honestly for us to put those into the mix whenever our customers are interacting with their patients for their customers.

Terrific. Thank you.

And the next question comes from the line of Matt Stotler with William Blair. Please proceed with your question.

Hey, there. Appreciate you taking the questions. Maybe just first one on the go-to-market specifically the direct channel, obviously, 2022 was a year of transition. We would love to just kind of get an update on how you are thinking about what’s left in terms of go-to-market initiatives for that kind of direct motion and then how that’s wearing into your outlook for 2023?

Sure. Thanks for the question. So yes, really ‘22 was all about reconfiguring our go-to-market motion and we have learned a lot. We have got a model in place now that is working and moving forward throughout 2023, there is going to be a fair bit of optimization. So we have grown our ramped reps pretty significantly during the year. We have now got a model where actually some of our reps that left are asking to come back. We have had two recent Presidents Club Award winners actually come back, because they have heard that good things are happening here. So we are getting good momentum on the sales rep side. Sales and marketing the organizations are really working well together. There has been a lot of improvement there. We have pretty, I think, a lot of small opportunities that add up to a pretty significant number just around optimizing our processes, our data, our data flows, lead scoring, a lot of the blocking and tackling that makes a big difference over time when multiple initiatives are compounded together are happening. So I think those are the big changes, optimizing how we manage through events. We are learning a lot about new events and how they operate. And having that really tight collaboration between sales and marketing is showing a pretty significant improvement but also opportunity for the future. So it’s a lot of – I think the heavy lifting, the major changes are done and they are working. And so now it’s just – it’s all hands on deck on optimizing and making sure that our CAC dollars are being spent efficiently. And as we were driving CAC down, that frees up dollars to add reps if it can be done efficiently, add more lead gen, so a lot of real just optimization from – for ‘23.

That’s some very helpful color. I appreciate that. And then just as a follow-up, you obviously you’ve talked quite a bit over the past couple of quarters about bringing the digital forms product in-house. You have a number of other third-party solutions that you offer and integrate with – how do you think about potentially bringing some of those additional solutions in-house or as you kind of balance a feature and product expansion from here kind of assessing where it makes sense to partner versus what’s more valuable as kind of a integral part of the platform.

Yes. So that’s a great question. We evaluate that all the time. Some of the things that come in mind that we’ve got a Buy Now, Pay Later solution, we have a an insurance verification solution. Right now, the partners that we’ve got in those areas are working quite well. But we always will be evaluating and trying to not be hostage to any one partner if we find that there is better ways to service our customers. Our goal here is to make sure that they have got the tools on our platform if it has to do with patient communication and engagement that they can use our platform to get that done. And so we evaluate those, and we will look for opportunities to bring those things in-house. We will look for appropriate plug-in acquisitions. We will look for anything that may make our platform more robust to make sure that the customers are served.

Got it. Thank you very much.

Just one thing I would add to that is – we believe strongly in being partner-friendly. We don’t feel that we need to build everything ourselves. So like Alan mentioned, we have partners now that are working really, really well. And then also, we may, over time, decide to acquire some technology or a product through M&A. So we want to be very partner friendly. And if the partner solution is the best way, it’s the win-win for us, the partner and the customer, then we’re absolutely open to that.

Got it. That’s helpful. Thanks again.

And the next question comes from the line of Mark Schappel with Loop Capital Markets. Please proceed with your question.

Hi, thank you for taking my question. Brett starting with you, with respect to the macro environment, have you seen much in the way of any change in terms of sales cycles or buying behavior or customer retention since the last earnings call?

Since the last earnings call now, we talked a little bit about it, I think, at the beginning of the year, where we saw some of the decisions where previously an office manager could just make the decision now maybe the dentist or the bed or the owner may want to weigh in and be part of that decision. So that’s been pretty consistent theme throughout the year, but certainly, no additional, I would say, sales cycle headwinds in the last 90 days.

Great. Thank you. And then just building on the earlier question around go-to-market. I was wondering if you could just expand a little bit on your sales strategy around payments. Is the company sales strategy around payments different from the strategy for the rest of the platform?

Yes, it’s a different motion. So currently, we have for selling the solution we have an inbound sales team that obviously handles all the inbound interest. We have an outbound team and then we have a middle market team and then we have an upsell team. We will – on a new sale to a new customer, we will introduce them to the payments concept. And then we are doing some work on the product to actually enable the going live with the payment solution even if it’s card not present only. So for example, enabling text to pay straight out of the gate. And then if a customer is not ready to go yet with the payment solution, we then hand that off to the upsell team, and then they would do a follow-up, and I’ve seen that work quite successfully in prior lives. So that’s at a very, very high level that the motion. And then, of course, we have teams that look at usage and make sure that customers who are signed up for the platform but maybe aren’t processing yet or are signed up for the platform and not processing the volumes that we think are possible, we would have campaigns either in product or marketing campaigns to reach out to them, explain to them the value to their business of the payment solution. So we’re kind of constantly but not annoyingly, informing them of the benefits they could get from our payment solution.

Great. Thank you.

And the next question comes from the line of Tyler Radke with Citi. Please proceed with your question.

Hi, this is Kyle on for Tyler. Thanks for taking the question. Brett, you mentioned 25 returning customers within 1 month this year. What kind of conversations were had with the sales team and what were those other platforms missing that was the main driver of their return? Thanks.

So Weave has been at this for a while, and we have built a very comprehensive deep solution. Sometimes when new entrants come to a space, and I’ve experienced this in a prior life as well, they will make very bold claims for very low prices. and customers will say, well, that sounds good. They’ll go over it and find the – either the solution is not what they were led to believe or they were really important pieces of functionality at Weave that they miss and they need or the implementation doesn’t go well or something great doesn’t happen and they come back. And so that is – that’s great to hear because it just validates the value that the Weave solution delivers to our customers. We actually call those boomerangs here internally.

Okay, great. Thanks. And just one more, given all the excitement around Open AI and Chat GPT, how are you thinking about the opportunity? And if you do plan to integrate the foundational models, is that something that’s built into your guidance and margin outlook? Or if not, what are your main initiatives within R&D this year?

So I can tell you that despite the desire from perhaps our product and engineering team, we did not build revenue into our model this year for AI-enabled products. The major initiatives around our product this year is expanding our SAM. So making – adding new integrations in our core verticals as well as adding integrations to other specialty medical. So I think med spa, plastic, physical therapy. So that would be one. So expanding the SAM through additional integrations, increasing our NRR through deeper integration. So our integrations can vary between being very light to very deep and we find that when we deepen the integration, it improves customer retention and it actually allows us to sell more products. So those would be two on the integration side. And then also on the product road map are new products and new functionality, so continuing to deliver product that makes us a really attractive platform for multi locations. There is certain functionality that multis would like. And so we have much of those – many of those key elements of functionality that multis want on the road map that we will be delivering this year. And then also additional products or features that enable us to take additional share of wallet and just be more competitive. So that would be, I think, the bulk of the road map for the year.

Thanks very much.

And our next question comes from the line of Jacob Staffel with Goldman Sachs. Please proceed with your question.

Hi, guys. Jacob here on behalf of Kash. I wanted to ask a quick question around – what you’re seeing in Q1 thus far, I apologize if it was just touched on earlier as well as what entirely does the guidance for fiscal ‘23 encompass from an assumption standpoint?

So in Q1, I think that we’ve seen more of what we’ve seen in Q4. We’re seeing some good momentum exiting Q4 that’s carried on through the first couple of months here as we’re near the end of February now. So we’re pleased about that, obviously. And the guidance, we want to make sure that our guidance that we have a high conviction it falls within the range that we are going to deliver. And given some of the economic environment, our desire to make sure that we get to free cash flow positive by the end of the year, that’s really what is influencing the guidance as we look through the balance of the year. We’re going to balance that carefully with the ability to grow, though. All of the efforts on the go-to-market side of our business, which are now coming to fruition with more ramp salespeople, less employee attrition. All of those things are up and to the right with respect to how we’re entering this year. So we’ve got to now just make sure that we balance that with the desire to make sure that we move towards quickly to reach profitability.

Awesome.

And then let me just add a little bit to that, if I could. The momentum that Alan refers to, just to be clear, is we’ve seen really strong lead flow. We’ve seen good sales. We’ve seen strong payments volume so far in the beginning of the year. So those are what the momentum that we’re seeing. And then also on the growth versus profitability, just to be clear, our goal really was to get our engine – our go-to-market engine, our onboarding engine, our support engine running very efficiently. And we – that was job one, to get the machine really working well. So our sales teams could be successful, so they could be winning. Our customers would be winning. So that was job one to get things efficient. And that was before we put more logs on the fire if you would to accelerate revenue growth. So I think we are really well down the path of getting the business running efficiently, especially on CAC and cost of delivery. And now we’re going to keep a close eye on that before we start throwing more logs in the fire. But make no mistake we definitely are very focused on growing the business. We just want to do it in an efficient way.

Awesome. Thanks so much. Really appreciate the color, guys.

And the next question comes from the line of Brent Bracelin from Piper Sandler. Please proceed with your question.

Hi, guys. This is Hannah Rudoff on for Brent today. Thanks for taking my questions. Just first one, kind of piggybacking on an earlier question, it’s really interesting and nice to hear about the boomerang customers. I just guess given this dynamic have you changed the way you position your platform in this environment at all?

I don’t think we have a lot. We certainly are – we have battle cards for our salespeople to more effectively kind of give them guidance around what they might experience and to even have referral customers that we can turn them back to you to make sure that they are making educated decisions. But I wouldn’t say it’s necessarily repositioning of our platform. It’s just we’re better at being able to hang on to those customers. Our customer success representatives are better able to do that. And we’ve got better data with which to do it with.

Great. That’s helpful. And then you’ve talked about the return of in-person events and intending and increasing number of these events. But I guess, how are your digital marketing initiatives trending? And how are you thinking about these going into this year?

So the lead flow over the last two quarters as we’ve seen significant increase there, where the marketing group is very pleased with the kind of run rate that we’re on. We’re also our close rates relative to the inbound leads are good and strong, and we’ve been able to maintain that strength. So overall, that I think is a positive. And we’re excited about those leads, not only in our core markets, by the way, but even in some of the other verticals, we continue to gain customers outside of our traditional core verticals on our non-integrated products, and that gives us a great starting point for us we decide to expand in the future.

And I’d just add that the marketing team has at least the leadership is new at the beginning of 2022, and they spent the year doing a lot of experimenting and working on understanding what dollars spent were produced the highest returns. They are very focused on trying new things. If it works great, we double down. If it doesn’t, we’re totally happy to fail fast and they have become quite clever on trying new things and seeing what works. So I would say that the digital marketing efforts have improved pretty dramatically. It’s a very results-oriented metric-oriented team. And I’m super proud of what they have accomplished and the fact that they are just always trying new things.

Great. That’s really helpful. Thank you.

And there are no further questions at this time. And I would like to turn the floor back over to Alan for any closing comments.

Yes. So, everybody thank you so much for joining us. I have been told that I misstated the guidance for my remarks. I didn’t intend for that to be different from what we published in the press release. The range for the full year 2023 non-GAAP operating loss is $21.3 million to $17.3 million, not $21.8 million to $17.8 million. So I wanted to clarify that. And with that, thanks for joining us, and we’re looking forward to connecting with you throughout this upcoming year.

This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.