Digital Media Solutions, Inc. (DMS) on Q4 2021 Results - Earnings Call Transcript
Operator: Hello, and welcome to the Digital Media Solutions Inc. Fourth Quarter 2021 Earnings Call. My name is Breer, and I will be today's event specialist. I'd now like to hand the call over to our host, Tom Bock, Executive Vice President of Investor Relations to begin. So Tom, please go ahead.
Thomas Bock: Thank you for joining us to discuss DMS' financial results for the fourth quarter year 2021. With me on the call are Joe Marinucci, Co-Founder and CEO; and Vasundara Srenivas, CFO. We posted our earnings announcement this morning in a press release and also on our Investor Relations website. By now, everyone should have access. Before we begin, I would like to call your attention to our Safe Harbor provision for forward-looking statements in our financial results press release. The Safe Harbor provision identifies risk factors that may cause actual results to differ materially from the content of our forward-looking statements. For a more detailed description of the risk factors that may affect our results, including disclosure about the effects of the Coronavirus pandemic, please refer to our financial results press release and our SEC filings. Also, during this call, management's commentary will include non-GAAP financial measures. Reconciliations between GAAP and non-GAAP financial measures for our reported results can be found in the tables of our financial results press release, which we have posted to our Investor Relations website at investors.digitalmediasolutions.com. The additional financial and other information to be discussed on this call can also be found on our Investor Relations website. Now I'd like to turn the call over to Joe Marinucci, our CEO.
Joseph Marinucci: Thanks Tom, and afternoon everyone. Welcome to our fourth quarter and full year of 2021 earnings call. We posted our press release earlier this afternoon, and I'm now happy to announce record fourth quarter GAAP revenue of $119 million up 17% year over year and also record adjusted revenue of $122 million up 17% over the prior year. In the fourth quarter, insurance revenue grew 13% versus Q4 2020. Our insurance segment contributed 58% of our total revenue in Q4 of which auto represented 49% and health came in 41%. We'll talk more about that split and the significance of diversification just a bit. We also continue to maintain solid profitability with adjusted EBITDA of $15 million, which translates to a strong margin of 12%. We were also pleased with our gross margin and variable marketing margins, which came in at 30% and 36% respectively. Of course, Q4 was just a culmination of a successful 2021. In 2021, we achieved GAAP revenue of $428 million and adjusted revenue of $442 million increases of 29% and 30% respectively. Our adjusted EBITDA was $58 million, an increase of 7% despite significant headwinds that had the power to disrupt our momentum. Vasundara, our CFO will have more details and will also dig deeper into the numbers and go over guidance for the first quarter and the full year of 2022 in a bit. So what drove growth for us in Q4 and throughout the year? I can highlight three things. First scaled spend; second data flywheel and third; dynamic diversification. These three things combined to produce the growth momentum we experienced in Q4 and really throughout all of 2021. Let me explain by going through each one of these one by one. First scaled spend, the digital transformation of advertising continues to accelerate with more and more ad spend moving from traditional channels to digital channels that have measurable ROI. In addition to the macro trends that are scaling spend for our sector, there's a reason advertisers are scaling budget specifically with DMS. Large advertisers have and continue to devote significant budget share at DMS. Why? Because they trust us to deliver reliable ROI on their advertising spend and to do it at scale. For our top 20 advertiser clients over the last year, our retention rate is a 100% and for those top 20 advertiser clients, revenue grew by 31% from Q4 2020 to Q4 2021. This scaled spend is directly attributable to our clients, trusting us to deliver the results they need. So why do our clients trust us and why do they scale their spend with us? Because time and time again, we are proving the effectiveness of our data driven tech enabled digital performance advertising solutions that reach the right consumers with the right messages in the right place and at the right to encourage action based on their intent. Our solutions deliver reliable ROI that is trackable, scalable, and predictable and because of that reliable ROI, our advertiser clients trust us, and this is why they scale spend with us. So the next obvious question is how do we deliver reliable ROI scale to our advertiser clients? And the answer is our data flywheel. We leverage our tool set, which consists of our first party data asset, proprietary technology and expansive media reach. We've talked about this a lot. We use the tool set to connect consumers and advertisers when they're ready to make purchases. Our scaling data asset is the biggest part of that story and we've talked about the power of our flywheel before. The more we scale spend and engage, the more powerful our data asset becomes. The more powerful our data asset becomes, the more efficiently we target consumers and connect them with advertisers that meet their needs. Precise targeting the entire conversion rate that translates into better advertising ROI and better advertising ROI means more scaled spend with BMS. So tide all together, this is why revenue from our top 20 customers grew by 30% year over year. Our data signals program has grown dramatically since we first began talking about it. In 2021, we generated approximately 1.9 billion engagement events and revenue attributed to data signals more than doubled versus 2020. This ties directly to our record revenue and Q4 increased engagement result. To help further quantify this, you see the rise again in our consumer engagement score or CES from 76 in Q3 2021 to 82 in Q4 2021. In addition, as ad targeting gets more cumbersome with third party data sources and targeting tools being sunsetted, we are increasingly able to rely on our first party data asset, and this helps us better understand consumer intent and therefore the first party data asset continues to provide us with a competitive advantage. Now let's talk about our key differentiator that was especially impactful in Q4. This is dynamic diversification, DMS solutions are vertical agnostic and channel agnostic. What does that mean? It means we're not relying on any one vertical or any one media channel for our growth. In Q4 for example, 28% of our revenues came from auto insurance. 23% came from health insurance, 20% from e-commerce, 10% from career and education and 8% from consumer finance. Similarly, when it comes to our media channels, our brand direct marketplace campaigns run across almost every possible digital channel. This includes search, social, email, programmatic and more, and with no individual channel or publisher representing more than a quarter of our total supply. But it's more than that. We're not just diversified. We like to say we're dynamically diversified, and the difference is very important. And it's a big part of how we continue to scale revenue and profit. Because of our dynamic diversification we're not tied to a specific percentage of our business coming from a specific vertical and equally as important, we're more insulated from the ups and downs of the media channels or our publishing partners. This is the competitive advantage for us that allows for our business model to pivot quickly and parallel with the opportunity. Here's an example, e-commerce was different than expected this year. Macro supply chain issues disrupted demand from some of the advertisers hoping to capitalize on holiday spending. Meanwhile, other e-commerce advertisers not impacted by supply chain, including those within the health and wellness subcategory of e-com, capitalize as they were able to leverage the DMS platform to match strong consumer demand with their products and services. So again, as both advertiser and demand and consumer intent pivoted, we successfully shifted. And by doing this, we maintained our growth momentum as a result of our agility within e-commerce. Our insurance numbers also tell the have DMS dynamic diversification very well. We all know about the loss ratio challenges restricting advertising bid prices within auto insurance. In Q4 2020 auto insurance represented approximately three quarters of our insurance revenue. Looking at Q4 2021, auto counted for just 49% of our insurance revenue. Even with the significant negative impact of loss ratios that lowered bid prices for major insurers, our total insurance revenue grew 13% year over year. How, because even with our insurance vertical, we are dynamically diversified and we scaled other insurance categories during 2021. In the end insurance as a whole maintained its spot with 58% of our overall revenue. Dynamic diversification has been a consistent go to market strategy for DMS as it allows us to pivot quickly to meet consumer and advertiser needs. Our dynamic diversification encompasses both the demand and supply sides. In other words, the advertising and media sides of our business Aad it allows us to navigate real time consumer behaviors, changing media prices and more while we leverage our data aspect. Lastly, let's talk about how our scaled spend plus our data flywheel, plus our dynamic diversification consistently deliver growth momentum. We had a record AEP and OEP period in Q4, both our brand direct and marketplace solutions, support health insurance clients, and therefore the growth was felt across DMS. Revenue for our health insurance business adjusted for the crisp acquisition in April of 2021 was up 35% organically over Q4 2020. And though we're hesitant to make any predictions on when auto insurance bid prices will spring back fully, our current visibility on Q1 has us believing that Q4 represented the floor, so we're optimistic for what's ahead. Across the rest of our business, including eCommerce, home services, consumer finance, career and education, health and wellness, we're seeing good momentum. So as we head deeper into 2022, we're cautiously optimistic about this year during which solid growth and strong margins are expected to be driven by scaling advertiser spend, our data flywheel and dynamic diversification. I also want to take a moment to thank our amazing team, is their grit, their agility, and their, whatever it takes mindset that continues to be a big part of how DMS continues to deliver growth. Before I turn it over to the Vasundara, I want to offer a quick update on our strategic review. As all of you know, a few months ago, we announced that we are conducting a strategic review aimed at maximizing value for our shareholder. Because this review is still ongoing, I'm unable to offer specific updates, but please know we are working diligently and hope to update you all on this process by our Q1 earnings report in early May. Now I will turn it over to DMS' CFO. Vasundara Srenivas.
Vasundara Srenivas: Thank you, Joe. Hello, and thank you to everyone for joining us today. I will start off with some color on our revenues. Reported GAAP revenue was $119 million a record quarter up 17% over the same quarter last year. Insurance, which accounted for approximately 58% of our total revenues in Q4, grew 13% over the fourth quarter of 2020. The breakdown of the insurance segment was as follows. Auto made up 49% of total insurance, health came in at 41% followed by life at 5% and home at 5%. Diversification, as Joe has mentioned, remains key for us. In the year ago period, auto accounted for approximately three quarters of our insurance revenues. Just touching on the other sectors, career and education, which was approximately 10% of our total revenues in Q4 grew 23% year over year driven in part by the competitive nature of this year's job market and growing wallet share from our top education advertisers. eCommerce, which represented 19% of our total revenue was up 36% compared to the year ago quarter, consumer finance accounted for 8% of our total revenue and grew 56% in Q4 over the prior year's quarter. When macro supply chain challenges restricted growth we expected from holiday shopping, we were able to dynamically scale health and wellness, and that resulted in solid gains in this vertical. Similarly upon the conclusion of AEP with transition traffic to support the strong consumer finance demand rolling through to the end of the year and into Q1. This is another example of how our vertical agnostic model and dynamic diversification continued growth. For the fourth quarter, reported gross profit was $35 million equating to a 30% margin within the guidance range of 28% to 31% compared to 29% margin in Q3 2021 and the 27% margin we achieved a year ago. Variable marketing margin or VMM was 36% compared to 35% in Q3 2021 and 32% a year ago, based on strong performance from crisp and highly utilization of DMS voice during AEP. On a reported segment basis, excluding inter-company revenue, the Q4 brand direct solution gross margin was 24% compared to 23% and Q3 2021 and up from 22% in the year ago quarter and the Q4 marketplace solutions gross margin was 28% compared to 25% in Q3 2021 and 26% from a year ago. Other solutions primarily including our SaaS software business had a gross margin of 38% contributing to our overall gross margin levels. We improved our already strong gross margins, even as auto insurance carriers squeezed their advertising spend through lower bid prices and as the health insurance market became very competitive increasing media costs. It is because of our ability to pivot into other categories, coupled with the strategic decisions such as bringing voice enabled call center software in house with the launch of PMS voice that we were able to mitigate the negative gross margin within the auto insurance and health insurance verticals. For operating expenses, in 2021, we delivered approximately half of our at annualized savings as part of the ETI initiative we launched in Q3. As previously mentioned, these efficiency and cost savings are not just a one-time initiative, but rather the fabric of how we execute our plan is to continue to identify and revolve redundancies throughout the business. our total operating expenses amounted to $39 million in the fourth quarter, a decrease of $6 million year over year, driven by quarterly fair market valuation of warrant expenses of $17 million offset by quarterly contingent consideration valuations of $4 million and acquisition related expenses. We ended the quarter with a total headcount of approximately 580 full-time equivalents. Finally, on profitability, our adjusted EBITDA in the quarter was $15 million or a margin of 12% flat versus the same quarter last year, driven by investments in our workforce to retain the necessary skill sets to support and drive continued growth for the company. Our net loss came in at $4 million versus a loss of $18 million in the same quarter. Last year. EPS came in at a loss of $0.11 compared to a loss of $0.32 in Q4 2020. Lastly, turning to the balance sheet and liquidity. We ended the quarter with $26 million in cash, cash equivalents and marketable securities up $8 million from the end of Q3, reflecting normal shifts and working capital. Our total debt at quarter end was $220 million and net of issuance costs, it was $218 million. As of quarter end, we had the full $50 million balance available to us on our revolving credit facility. Our net leverage stood at 3.3 times at year end. As a reminder, our credit facility from last year puts our leverage covenant at five times currently. So we feel that we have plenty of liquidity under our facility, but of course we are very mindful of our obligations given current volatility. Turning our attention to 2022, we expect solid organic top line growth to continue in 2022 as auto insurance recovered and demand continues across our other verticals, including health insurance, consumer finance and e-commerce. We are closely watching all the other verticals we serve, especially including the auto insurance and health insurance markets. Inflation, continued supply chain issues and the lag time of individual approving weight heights all continue to weigh on the auto insurance sector. Although we believe auto insurance pricing has gotten out and is showing solid trends when compared to Q4, advertising spend is still down within auto insurance year over year and this is an expected to be a quick recovery. The timing and the extent of the recovery in auto is still unclear, but we are increasingly optimistic about the second half of 2022. As a reminder, in Q4 auto insurance was less than 30% of our total revenues. We expect to continue to see strong demand for the advertising solutions we provide to our Medicare clients, which a majority of our health insurance business. Meanwhile our Protect Medicare agency business faces challenges due to competition, rising customer churn rates and lowered lifetime values impacting pay outs. Revenue sharing agreements are being reworked across the sector, including for us. Inflation is already impacting us in 2022, as we have to remain competitive on wages in a tight labor market. And inflation also has the ability to impact other cost areas of the business inclusive of operational expenses and even possibly spilling over intermediate costs. Lastly, the pandemic still represe uncertainty with regards to a number of factors, including staffing for us and our publisher partners and advertiser clients. In fact, as we all remember omicron spikes were significant in Q1. As discussed on a prior earnings call, we have pivoted to GAAP revenue for both reporting and guidance. We currently feel comfortable in achieving a Q1 GAAP revenue range of $102 million to $107 million and a full year 2022 range of $465 million to $475 million. As a reminder, we're not going to be reporting adjusted revenues going forward. For those of you listening and wondering what the guidance would have been had we continued with adjusted revenue, that guidance for 2022 would've been $481 million to $491 million. The macro headwind we had have been facing within auto insurance have created download pressure on gross margins. We reacted quickly and strategically by pivoting into other categories such as Medicare, life and health insurance, mitigating the negative margin impact, a dynamic diversification as Joe mentioned, is foundational to how we run the business as well as a key competitive advantage for us. Our ability to adjust and pivot dynamically also contributes to our comfort with maintaining our previously discussed gross margin guidance range of 28% to 31% and variable marketing margin range of 32% to 36% for both Q1 and full year 2020. We continue to expect strong EBITDA margins, even with headwinds from wage inflation, rising public company costs and pricing pressure in the auto insurance segment. Our current Q1 and full year EBITDA forecast is $10 million to $12 million and $55 million to $60 million respectively. In summary, the combination of scale spend a data flywheel and dynamic diversifications delivered a strong Q4 with growth momentums that will propel us in Q1 and beyond. With that, we thank you for your interest in DMS, and we will now open the line for questions. Operator, please let our listeners know what they have to do to ask questions.
Operator: We have our first question on the phone lines from Maria Ripps of Canaccord. So Maria, your line is open.
Maria Ripps: Great, thanks so much for taking my questions. Joe, appreciate your comments on dynamic diversification, but so can you just talk about what you're seeing in the order vertical and whether there was anything different in the recovery standpoint from what you anticipated maybe a few months ago and that sort of understanding that there's still a lot of uncertainty around the vertical, when would you sort of anticipate the vertical to return to more normalized run rate? And then I have a quick follow up,
Joseph Marinucci: Hi Maria, good afternoon. Good to speak to you. So, we're not really seeing anything different. We anticipate what I would call a wide U-shape recovery, because it takes time for the carriers to adjust their pricing. So the regulatory environment dictates that about country use and file or I guess filing use, which represents faster speed to market and the other, have the country's prior approval, which is slower speed to market. So there's differences in speed to market. So rates move accordingly, just to give you an example, we still have, 19 states that are still paused based on with various carriers that are still based on some of these approvals, and I think this has been widely communicated and anticipated that it was going to be this type of recovery U-shaped not V-shaped and we're seeing that. Bid prices bottomed from our perspective in, November, December now up off the bottom in through the end of February, we're up about 20% off the bottom. So we are starting to you that nice u-shape recovery in auto insurance, which is really no different than what we previously expected to see.
Maria Ripps: Got it. That that's very helpful. And then maybe my second question just sort of a broader question. You've had a lot of success with your health vertical and sort of, as you look at your different offerings in that vertical today, how do you sort of -- how do you think your position versus some of your peers? Are there any sort of assets, technology or functionality that sort of you think would be additive to that vertical?
Joseph Marinucci: So, we obviously saw growth in health insurance this quarter. We diversified, if you look at insurance, for Q4 2020 versus insurance Q4 2021 health insurance, significantly diversified the vertical and then just generally auto insurance was the largest vertical at 28%, but then health insurance, right behind that at 23%, it comes straight down off the top and it leads off data accompanied by technology and media reach and our ability to leverage that toolbox and then serve the competitive marketplace has been a differentiator for us. We made an acquisition this year and so we did that in conjunction with our organic growth strategy and that has played pretty much out as we expected it to be, which is why we saw a nice growth in the fourth quarter inside of the total business inside of insurance and then more specifically inside of health insurance. I can't specifically speak to the factors that might be impacting some of the peers, but we see the same things that they see, which is Vasundara mentioned this in her segment, she talked about out models being adjusted for lifetime values. And I think generally that's understood to be the result of more price shopping by consumers, which has led to churn. So some of those lifetime values have been adjusted down and that's still being worked through, but we still see a competitive marketplace for digital performance marketing. In fact, I think that leads to, those writing health insurance, whether it's over 65 or under 65 health insurance, just continuing to demand accountability in their media spend. So basically looking for linear tracking to their ROI and that ultimately will win the day from that perspective. So, we're just going to go up top and continue to leverage data technology and media reach to do that on behalf of our customers. And that's why we saw the growth we saw in the Q4 period.
Maria Ripps: Got it. Thanks so much. Joe. I appreciate the call.
Operator: Thank you, Maria. We now have our next question on the line from Jason Kreyer of Craig-Hallum. Sir please go ahead when you're ready, Jason.
Jason Kreyer: Hey everybody. Good afternoon. Joe, so obviously really good KPIs from your top 20 customers, good retention and growth figures. Just wondering if you can talk more specifically about the actions that you can take over the next year or so to get, the smaller customers to see similar, retention in spend rates and things like that.
Joseph Marinucci: Hey, Jason, good to talk to you again. Yeah. So top 20 customers, which represent the vast majority of our revenue, 100% retention there, obviously a really strong KPI. Look, there are some macro headwinds right now, so you do have, and when I say macro headwinds, they're you've got them inside of insurance, you've got rising interest rates, you've got inflation. I think generally what this means is yeah, tighter labor market that ties directly to inflation. So people are going to be managing costs more efficiently and effectively just continue to maintain a bottom line. So at the end of the day, like marketing spend is got to be held accountable and that's the value proposition that we bring in digital performance marketing is we're aligned with the customers. So obviously, the top 20 customers being the vast majority of our revenue. We're very, very focused on their needs. And for the most part, they're all scheduled to grow this year. So we have to match up their plans with our ability to deliver, global solutions against those plans. But at the same time, we do manage the sales pipeline. The sales team is out there, working active prospects, bringing them in and once we get through what I would call a testing phase, our goal is always to retain the customer. And historically we've had very high retention rates and I don't necessarily think that that's going to change. So as you move into this type of environment where there's a lot of different things that are going on that concern people we've mentioned them. For us, there's a countercyclical balance in that because it's going to cause a higher degree of accountability and marketing spend and that plays to our benefit. And then, once we bring customers in, not everybody starts as a top 20 customer, they got a scale spend over-time, the fact that we're retaining the top 20 to a hundred percent is indicative of what's going on below that. So we're just going to continue to deliver on those solutions. And we believe our retention rates will remain consistent with what they've been in the past.
Jason Kreyer: Okay. And, and then one for this under here. So if, if we look at the rev guide, we're looking for, I think it's around $40 million to $45 million of incremental revenue, you look at your gross profit margins. It's probably in the ballpark of $12 million to $14 million incremental gross profit. So, but, but you're guiding to about a flat EBITDA number year-over-year. So I'm just, I'm curious if you can dissect, about $12 million to $14 million in incremental OPEX. What is layering into the model that keeps that EBITDA flat? And then, as we go out to like a 2023, do you expect to get most of that back?
Vasundara Srenivas: Yeah. Hi, Jason. Yeah. Thanks for that question. So, I mean, if you think about it, let me kind of decipher EBITDA as it stands today, right? If you look at it in the fourth quarter, it was $15 million flat year-over-year, right for the quarter. And we were below about two percentage points from the prior year. We talked about most of the reasons inflationary pressures, is a big ticket item that we continue to watch. Increased technology costs was one of the reasons that drove those costs up and incremental legal professional fees to stay compliant and Public Company costs. In addition to that, we had acquisition costs acquisition really cost with people and other items associated with the acquisitions. But then we saw downward pressure from a gross margin standpoint, which we talked about big prices and so on. So I think it's a combination of those items that drove our adjusted EBIDA to be flat year-over-year. How do we think about it going forward? I would say, I mean, there is inflationary pressures that we continue to watch. There is timing and extent of auto insurance recovery that is still unclear to us, that will continue to watch. And we expect that to recover in the second half. We are facing some challenges with, operating expenses in general. So if you look at our total expenses and the make of those total expenses, one of those key items is pretty much accounting and technical entries that you see there, right? Contingent consideration is one item, one valuations and so on. So overall I think just considering the pressures we're seeing on the gross margin public company costs associated with operating expenses, acquisition related costs and inflationary pressures. I think we are cautiously optimistic here. So we've provided a conservative guidance of about 10 to 12% EBITDA margins going forward. There's definitely opportunities here with the cost initiatives that Joe alluded to that is a fabric of our organization and will continue to look at every opportunity there to create efficiencies both at the gross margin level, as well as the operating. So we are seeing some upside there. Go forward.
Joseph Marinucci: Perfect. Thank you very much.
Operator: Thank you. We now have a question on the line from Marvin Fong with BTIG. So Marvin, please go ahead.
Marvin Fong: Great. Good evening. Thanks for taking my questions. Just the first question you guys provided, both, first quarter and full year guidance. So from a full year of just curious, you must have some idea, you know from a, from a category standpoint, right, which -- which end-markets you, you see doing, well versus perhaps seeing a bit of pressure. So could you just kind of decompose your thoughts around, full year growth between, insurance maybe breaking that down further between auto and health and then also career education e-commerce and, and consumer finance? Thanks. And then I have a, another question.
Joseph Marinucci: Hey, Marvin, good afternoon. It's Joe speaking to the beyond with you again. So, maybe just general positioning up top, we talked a little bit about dynamic diversification and the press release and then more on the call and, it's, it's, it's really what has helped the business continue to grow, to be honest with you, because it flows down off of, how we operate, which is, data driven, proprietary technology, agnostic media, it's a vertical agnostic channel agnostic model that leverages that central toolbox. And obviously we do a lot of work, the insurance space, which is now split up in between the auto and the health category, and then you have home and life behind that. So we look at the dynamic diversification as a differentiator that allows us to move through, periods of what I would call, modest uncertainty, which is what we're seeing right now. If you look at insurance, on both sides between auto and health, if you do have, some macro issues there and auto, you have loss ratios that have been widely publicized and we're into the early stages of that U-shaped recovery. So I think I used the term cautiously optimistic on the, on the call. And I think that that is consistent with what most people are anticipating with auto insurance, second half recovery, cautiously optimistic we're going to get.So that would be part of the guidance. When we look at health insurance, there's, there's certainly some pressure there on the lifetime values that the various partners that we work with are working through on their side. And ultimately that's going to come down to us now, we do believe that demand for digital performance marketing will remain strong there because a high degree of accountability in the marketing spend and ROI is critical. So, there's a give and take there. And we, we do believe that the trend will be, more accountability, continued acceleration of the digital transformation of ad spend. So we do think that benefits us, but there's uncertainty in terms of how that plays out. And we won't get there until the Q4 period with the open enrollment periods for both AEP and OEP. So there's a bit of runway between now and then, and, we in building our guidance for this year, wanted to weigh these various factors that we're discussing and, take the approach that, these types of situations, especially with auto U-shape recovery will play out and we'll bend into dynamic diversifications that the company will continue to grow. And if, we took a degree of conservatism to, some of the, through that we're seeing, it gives us an opportunity to see that growth accelerate, but, we're not just focused on 2022, obviously we're focused on, much longer term growth. We're very excited about, the continued acceleration of the digital transformation of ad spend. We very much look at the business as having, significant growth ahead, not just in 2022 through, some of the uncertainty that we're discussing, but, further out into the future. And, the, the business grew nicely last year. we, we do have some modest growth members out there this year in guidance at about 10%, but procedure said it, we feel that there's some upside there, but we've also talked about quite a bit of risk, so that's all, that's all baked in.
Marvin Fong: Thanks. Thanks for that. And then I guess second part of that question, also on, on guidance, margins have always been something investors have been watching and, and I think you guys did a good job this quarter. Just, just comment on your visibility there. I, you've obviously mentioned that there is downward pressure from Autos and, and the anticipated recovery will be U-shaped, but just, how, how confident do you feel that a 28% will hold as a minimum? And just, just further elaborate on, on what you're seeing in terms of your visibility and discussions with your clients. Thanks.
Vasundara Srenivas: I can take that Joe, and you can come in if there's anything I missed. So, Hi Marvin, we don't manage business to assess margin goal, as we've said before. Right. we continue to focus on optimizing our services to create efficiencies. We talked about DMS voice that gives us, you know diversification creates efficiencies, reduces our cost of good. So, it's a very strategic investment for us that has created a lot of efficiency within the cost of goods sold and will continue to look into that. Add more to our technology stack and increase those efficiencies with connecting the consumers and advertisers. So overall, where I'm going with this is very, we are comfortable with the gross margin range of 28 to third. We are well aware of, media costs, that they, they do. We have seen increases for example, in Q4, as a result of the holiday shopping and AEP media costs rose, it's not always immediately reflected in what we can charge our clients. Therefore it may impact gross margin and BM. There are some seasonality in media costs, which is why we have a guidance range of 28 to 31% on gross margins and 32 to 36% on VMM. Also remember as our advertiser clients continue to spend more with us, our first party data asset grows and our consumer targeting and improves, it helps drive gross margin. And BMM even within that environment of rising CPMs and the pressures we're seeing future acquisitions would change that view too. It will. And I say, overall, I think we're comfortable right now with the 28 30 1%. And we have a path to get there.
Joseph Marinucci: The, the only thing Marvin, I would like to say, and behind that is if you look at the Q4 2021 period, basically every vertical inside of the business grew in period. And to the center's point it's because we're managing the business for growth and, working in strategic partnership with our advertising clients, and we're maintaining that healthy range that she discussed. But, if you look at eCommerce, consumer finance, education insurance, even, the bucket of other that is kind of everything else that doesn't fall into that every single category grew in Q4, and that comes straight down off the top data driven business, leveraging proprietary technology, accessing expansive media reach, and we're able to grow broadly across the business and maintain margins and range. And that's the result of not being overly focused on managing to margin, but managing the business to growth objectives that meet our client and slash advertiser's objectives.
Operator: Now there are no further questions at this time. This concludes today's conference call. You may now disconnect.
