Unity Software Inc
NYSE:U
Earnings Call Analysis
Q3-2023 Analysis
Unity Software Inc
Unity, a leading platform for creating and operating interactive, real-time 3D (RT3D) content, has faced recent challenges after a pricing change. The issue had a limited impact but did linger into the fourth quarter, necessitating an effort to rebuild trust with game developers. CEO James Whitehurst emphasized that game developers' initial dissatisfaction shifted to enthusiasm with an understanding of Unity's future features and commitment. The key to regaining trust lies in Unity's actions and delivering increased value through product launches and robust feature development.
Unity's new leadership, with James Whitehurst at the helm, decided to withdraw full-year guidance and prioritize rapid, decisive action over short-term numbers. This approach is directed towards restructuring the business, which involves winding down or divesting certain segments. Whitehurst assures investors that Unity will move quickly in this transition phase and be transparent post-restructuring, with guidance to be provided for Q1 upon completion. The expectation is to reset and focus on stronger long-term performance.
The User-Generated Solutions (UGS) segment underperformed in the recent quarter, prompting an acknowledgement of the need for faster business growth. Unity aims to refine its offerings around its strengths, particularly the Unity ecosystem, and capitalize on critical areas such as mobile, where it holds over 70% of the market share in its editor. Performance in various segments needs improvement, and Unity is actively working on engaging and delivering more value to customers.
Unity is undergoing cost-structure optimization, focusing on refining its portfolio and driving internal synergies. Despite these changes potentially leading to fewer employees, Whitehurst believes that the remaining team will be galvanized by Unity's mission and the efficiency gained from the restructuring. The goal is to build a robust operating model aligned with Unity's core businesses and enable scalable growth from a solid foundation.
To address investor concerns, Unity's leadership expressed confidence that better-focused execution will naturally lead to improved growth performance. While details on the growth drivers and specific numbers are yet to be fully outlined, the company is preparing for a strong 2024, with plans to execute on the large opportunities within its portfolio and enhance product-market fit. Unity remains committed to a strategy that ensures systematic profitable growth through focused initiatives in each of its designated segments.
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Before we begin, I want to note that today's discussion contains forward-looking statements, including statements about goals, business outlook, industry trends, market opportunities, expectations for future financial performance and similar items, all of which are subject to risks, uncertainties and assumptions. So you can find more information about these risks and uncertainties in the Risk Factors section of our filings at sec.gov. And actual results may differ, and we take no obligation to revise or update any forward-looking statements. Finally, during today's meeting, we will discuss non-GAAP financial measures. Now these non-GAAP financial measures are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP.
A full reconciliation of GAAP to non-GAAP is available in our shareholder letter and on the sec.gov website. Great. So let me turn the call over to Jim to kind of make some opening comments.
All right. Well, thank you. And let me say good afternoon to everyone, and thank you for joining us on today's call. We released our Q3 earnings today as well as the shareholder letter that describes our results. I assume you've all read that. So let me just highlight 3 quick points before we get into Q&A. First off, I've been at Unity now for about a month. And I have to say, I'm so impressed with the passion, both inside the company and more broadly in our community. And that is unquestionably a good thing that we elicit so much passion from our community. It shows the level of engagement that we have and the importance of the role of Unity in our community. It's our job now to focus that on the most important task, which is to build a best-in-class platform that help make creators more successful from start to finish from design to monetization.
Second, the world has changed, and we're changing with it. We've taken some good first steps to bring expenses down, changing Unity from a money losing to a cash flow positive company in less than a year. That's a good first step, but frankly, we're examining the company from top to bottom, ensuring that we transform Unity into an even more nimble and focused business, and I'm sure we'll talk more about that. And third, once we position Unity to succeed, we need to accelerate growth. We'll get there by focusing on large growing markets but most importantly, by doubling, if not tripling down on building amazing technology that helps our customers succeed. If we do that, growth and profitability naturally flow from that. So with that, let me turn the call over to Richard.
Great. Well, thanks a lot. So maybe what we'll do, which we've done in the past as we kind of get inbound questions during the quarter and things like that. So maybe we'll kind of hit like the 2 most common questions we often get. We'll start with Jim and then we'll go to Luis and then we'll go to open Q&A and things like that. So for Jim, if you kind of step back, what do you see and I know you've been short term here for a month, but maybe it's fair or not, but what do you see the company looking like in 3 to 5 years? What's your vision?
Yes, sure. And let me start off saying, I've had experience in a company building a business as part of a broad community. So I naturally come back and focus on how we think about community. So if I just put that simply in 5 years, I want us to be the trusted leader of a community of creators building on our technology. And because of that, we'll be an indispensable partner for game creators to build, operate and profit from their creations. That alone is hundreds of billions of dollars market. Secondly, our technology, and this is 1 of the things coming from enterprise, I've been so impressed with is incredibly relevant to enterprises.
And so the second piece of that is I'd like to see our technology as the default choice for enterprises and individuals to create and interact with 3D content. Again, that is a tremendous untapped potential as well. And so if we can do those 2 things be an indefensible partner kind of a leader in helping game developers, and being the 3D visualization technology that the world comes to, that's a really exciting business.
Great. And then Luis, it's addressed to some degree in the shareholder letter, but could you kind of explain some of the key interventions that are being considered?
Sure. Thank you, Richard. We started a comprehensive assessment of our product portfolio several weeks ago. And we're evaluating every product in our portfolio through, I would say, 3 lenses. First, are we meeting our customer need in a unique way that differentiates us from others. Second, are we able to grow revenue, expand margins and generate free cash flow at attractive levels; and third, is the opportunity large enough and sustainable to build a meaningful business over time. And while we're making great progress in this evaluation and planning, it is still early to share more specifics.
Now what you can expect is that we will be making changes to our product portfolio this quarter in Q4, and we expect the full implementation of the changes to be completed by the end of Q1. As Jim said, we're also continuing to adjust our cost structure to improve margins, and this will lead to a reduction in force, a reduction in office locations, which we will be announcing over the next few months. Back to you, Richard.
Great. Thanks very much. Okay. Now we can open it up to Q&A from the analysts. So Thomas, if you can see the people that are in the queue, and we can drop them in there. Yes, Dylan Becker at William Blair.
Jim, maybe starting with you, I think, in the shareholder letter, obviously, there's a lot of focus on narrowing scope and the focus here. But looking at it a month in, maybe some -- there's some initiatives underway, but how you're seeing the business relative again, to maybe some of your past experiences and the opportunity to drive that efficiency that you've done maybe utilize some of the prior playbook you've seen.
Great question. I want to always be careful not too much drawing parallels, but frankly, there is a lot of parallel to this. And frankly, when I first got to Red Hat, which is Red Hat had an industry-leading product with Red Hat Enterprise Linux, but we're spending a tremendous amount of time doing 5 or 6 or 7 other things. And it's not just the expense associated with it, it is the management time and attention and more broadly, the clarity of focus throughout the organization that you get from doing fewer things. Frankly, where you are winning and have a right to win. And so I do see parallels there just very, very simply. We're doing a lot of things, and we obviously have a leading share product that's growing nicely. And then there are some extensions off of that, which are actually fit in well with good synergies. But frankly, we're doing a lot of other things. And so one is just I think there's very similar to Red Hat, let's start off narrowing down, make sure we are on our path to achieving the full potential of our core business before we get too busy doing other things that aren't directly tied to that.
And then number two is just sharpening our execution. I think obviously, there's a natural evolution of companies where you start off, you get kind of product market fit, you're trying to experiment you're running a lot of experiments around your less focus on driving effectiveness and efficiency. And I think we're to the point where Mark has voted. We got a couple of really leading products, whether that's the engine and run time, whether that's our core kind of monetization stack.
And to focus down, put the right KPIs in place, tighten our belts and execute into those things. And as we do that, we have a solid profitable business that we can scale from these leading positions. And so it is a little similar to Red Hat, both in terms of leading product, but doing a bunch of other things and losing focus. And just naturally not being at the point until now of really looking to kind of build an efficient and effective operating model around those things. And so I think those are the 2 big ones that feel very, very similar.
Also equally incredibly passionate, brilliant people who are deeply dedicated in a deeply mission-driven company. And so when you have that, your ability to execute, when people are aligned and passionate about what you do is just so much easier. And that definitely shared with Red Hat.
Sure. Awesome. Okay. Helpful color there. And then maybe to -- I think you guys called out a lot of the synergies you're seeing within the Grow solution base and the importance of iron source and level play there. But maybe it's a little early to call out from a product perspective, too. But you did mention tightening the integration between kind of Create and Grow. But how do you think about that synergistic value coming together across the platform over time?
Yes. I'll start, and Luis, if you want to add. So first off, really working to build an operating model that drives value in both kind of data across Create and Grow. I think we can do a better job of doing that. We've been working on the integration of just kind of people and things, but really building the flywheel there is an area, I think we can kind of double down our focus on, which has a lot of value. The other is just together, those 2 things are what drives developer -- game developer success. And we're still a little bit because we're still in the middle of the integration disjointed and having a single view of our customers, so we can go talk about how we can help them best create value from development all the way through to monetization. And we have kind of those 2 pieces. And it's just a time to get those kind of fully pulled together to have single deal customer, ability to engage and talk about how we can create value across that life cycle with our kind of portfolio of offerings. So there's kind of the operational data-ish, I want to say, stuff, and then there's the broader steel view of customer and being able to act that way, set of stuff.
Yes, I agree, Jim. And if I were to add something, I would just say this is unique to us, right? We're the only company who has both create and operate or grow businesses, and that's very valuable to us and to our customers. And remember, we have over 70% market share on the Editor, particularly on mobile. So that gives us a very strong base to build upon.
And then Michael Funk at Bank of America.
And Jim, I really -- I appreciate the [indiscernible] tax opening letter today as well. I'm just wondering, you did mention that there was a limited impact from the pricing change in blood over into the fourth quarter. What have you been doing to reach out to the game developers and rebuild that trusted relationship with them?
Well, a couple of, obviously, I've been talking to a number of them. And it's one of these -- I think almost all of them that I've talked to or others that have talked to in Unity, who talked to them, start off with game developers who were upset by the first action, once you actually get people to focus on the next set of things we did, the first thing you hear is like, oh, okay, well, that all makes sense. I'm actually good with that.
So the changes we then went back and tweaked, I think, helped a lot. But honestly, the biggest thing that helps is when we talk about the future feature velocity we're driving, I was talking with someone here who had just met with the game developer, started off very, very negative -- but as soon as we started getting into some of the features we're driving, all of a sudden they went from, we know we want to deal with you to, oh, can we be an early beta customer and can we actually potentially get in there and help drive some feature set into that. That's right what we're trying to do.
So I think the most important thing is we can talk -- I've been saying this internally at Unity quite a bit, having dealt with communities in the past is we can talk all we want, but our behaviors are what we'll rebuild trust and the behaviors are we make decisions going forward and how we are taking those dollars and reinvesting them efficiently and effectively to build extraordinary product. And so next week, we'll have a number of product launches. And I think really kind of focusing on the value we're delivering, we'll kind of get that buzz replacing kind of noise around, well, what are they doing?
And 1 more, if I could. I think a lot of investors are wondering about the decision to pull guidance for the year. Was that based on your view of best practices as a new CEO coming in and assessing the business. or any [indiscernible] on all the numbers.
Yes. No. A lot of people are grumpy about that. Look, the problem when you are looking to wildly wind down or get rid of some businesses, which is part of what we'll do is the longer you wait to do it, the better your revenue looks in the short run. I want 0 incentive for anybody here to slow anything down. We need to move and we need to move fast. And the faster we move, the better shape we are. So we will plumb it all out after the fact for you. You'll know exactly we'll be completely transparent. But what I don't want to have happen is people say, "Well, we kind of guided this. And so if we just wait another month before we do that, maybe we don't close that until January 1 instead of November 30. -- you can make the numbers look better. But I want to emphasize we got to move fast, and we got to be decisive and we're going to merge, I will say, I think we're sandbagging when we say by the end of Q1.
I'm hoping we can do it a lot faster than that. The faster we can get these things done, the faster we have kind of reset and we are focused the better, and I want 0 incentive for anybody to do anything but that. So it was not a popular move. I can tell you to say we weren't going to do it, but I think it's better to move fast and then be transparent after the fact. And I promise you after that, we will be reset, we'll be confident in our numbers, and we will provide guidance for Q1 and the year and give you all the color and clarity you want. I just in this period of time, I think it's important that we have no barriers to move them fast.
Great. And then next is Brian Fitzgerald at Wells.
I had a couple, if I could, on UGS letter noted tough year-over-year comps. Just hoping you can give a sense for how that business performed relative to expectations for the quarter and whether there's anything waiting on that part of the business? And maybe second one follow-up to that is, can you comment at all on ironSource cross-sell opportunity and where you think the business stands right now, When you say in the shareholder letter that the company is not achieving the synergies and that exists across the portfolio? Are we right to assume that's what you're talking about there? Or maybe that's where the softness in UGS comes from.
Yes. Go ahead, Jim, do you want to...
Well you go head start, if you want to kind of give performance versus expectations, I'll give you a sense of what I meant by that not performing across.
Yes. I mean we don't want to single out any business because we're not ready to share specifics on whether a business is inside or outside of the portfolio choices. But I will address your question of UGS. Frankly, we didn't have the quarter we expected on the business, right? And therefore, I'll be very transparent about that, and we need to continue to drive our business and grow faster. So I'll give you that piece.
I'll just say I will use that as an example. When I say that, I actually mean broadly across the portfolio, but I'll pick on UGS. I think UGS has been quite successful selling into gaming. But if you actually look at the correlation between, say, something like multiplay and Unity made with Unity Games, it's actually quite low. And so what I want to make sure that we're doing is when where we have the right to win, which is around our Unity ecosystem. So I'm not saying it's awful revenue to go sell multi-play in unreal base game. But fundamentally, the place where we have the right to win and should win is things around Unity. And so what I'm looking at across our portfolio is making sure that things that we do are self-reinforcing. The things that we do make Unity Games better and people using Unity make it really, really easy to use our other things and get that flywheel going. So if you look at our correlation between some of our other services in the engine, they're not as tight as I would like to make sure we make it really easy for our debts to use our things and make our things make Unity made with Unity games even better. And that extends across again we talked a little bit. We've made progress in integrating IronSource, but a lot of that is getting the core stuff together. Now getting the flywheel that we think we can do of the real synergies between the editor in the run time and the grow business is something we are just getting kicked off. And I'm the type -- I want to have a weekly meeting on what's the progress? What are we doing why is it going to be done? -- and we've been more focused on the integration than on really getting the synergy flywheel going. And so that's something we're kicking off in earnest.
Yes, Brian, as we've talked before, what we're seeing is good synergies of growth within grow, Unity and iron source. So that's working well, technologies, capabilities, that data that's growing well. But as Jim is saying, they agreed to grow is where we need to sharpen the pens and do a better job going forward.
Great. And next is Clark Lampen from BTIG.
I've got 2, please. Jim, maybe we can start big picture with sort of a view of the engine market. I understand you've only been with Unity for a short period of time. But 1 of the big questions we get from investors around that piece of the business is how you start to close the gap between really high and fairly dominant developer share and your revenue share at present? Is a variable rate model like run time really the key to unlocking that upside? Or are there other adjustments that as you look at that business, you think need to be made to ensure it can grow?
Well I think there's a lot. And by the way, we haven't even started on the industry side, which I would actually argue as a larger market than the gaming market for us, but we can come back around on that. So first off, the gaming market is a lower-margin market. So when you started at 1 price point you want to change it, you're obviously going to get some backlash. So the way I'd rather think about it is if you think about development all the way through to operating a game is a $100 billion market, right? We're a very, very, very small, less than 1% share of that. So our ability to do things like whether it's driving to DevOps or automated testing or you think about other things that developer shop, especially teams that developers do thinking about kind of security, thinking about compliance, identity management. There's a whole set of things where we're not raising price on what we're doing, but we are looking at the costs around what someone does when they're working with us, has a tremendous opportunity just on the development side.
And then obviously, on the operate side, continuing to look for places where, frankly, we have a right to win because of the strength of our editor and run time and our ability to understand what people are doing and how and the uniqueness around that. I think the run time fee is important for multiple reasons. One is internally have people recognize there's value in the run time, right? And so if nothing else, it makes it much easier internally managerially saying we need to drive more velocity into the run time and the feature functionality around that. I know you can kind of conceptually say you do it, but it's much easier when there's actually revenue associated with it. And frankly, I think it's easier to explain to customers that you're paying for something, but look at the value, and now we can accelerate value around that.
So I think making the run time not like kind of a second-order citizen in how we think about monetization is important. I think going forward, thinking about, especially on the industry side, where run times themselves, whether it's the exact run time or more broadly what that looks like in feature velocity in that having a price around that and how you think about that as you scale out, I think it's important.
So we can get into the specifics around the run time pricing and kind of what model and what types of games, et cetera, et cetera. But I think the concept that the run time has value. And so we have a price on the run time is healthy all around for how we run the business.
Understood. And I guess, there's a lot in flux, I guess, as you guys are exploring sort of interventions, as you mentioned in the shareholder letter. One of the things that does seem to be consistent moving forward in terms of focus is AI. I'm curious if you could give us an update on the [indiscernible] incentive products. How has the closed beta gone so far? When do you think realistically, those tools could exit beta? And if you have any thoughts around commercialization that you'd be willing to share on this call would be appreciated also.
Well, my first reaction will be, how about coming to Amsterdam next week, the night and you will hear a whole lot about that and kind of the things we're doing more broadly. I mean, honestly, I mean I'll let Luis if you want to comment. But I think given everything we're saying Unite, we don't want to kind of front-run that here today. So Stay tuned and/or come join us in Amsterdam.
Yes. The only thing I would say is, well, Jen didn't say much. You can see in his tone kind of how excited he is so you can take something away from that. So it's very exciting.
Okay. Next is Kash Rangan from Goldman.
It's been a while. And I don't know what is it that you use to keep your person exactly unchanged in the past 15 years. You look exactly the same as you did when I first met you, I think it was 2008 when you took over [indiscernible] Red Hat. I know that definitely helps. I can see that. I can see that there clearly a lot to digest coming to the company. One is what are the chances you take the job permanently in the next 6 months or so. It's a tough question, but -- or maybe it's not a, it's a very easy one. And secondly, you hinted at a tighter integration and tighter synergies between the Create and Grow businesses. Can you expand a little bit more on that particular thought? And where do we go with that increased synergy? And how does it manifest itself.
Yes. So on the first question, I want to be respectful of the Board, the Board running a process. So I think as they said, they want to run a process. And -- so I want to be careful about anything I say because if I say I'm a candidate, that kind of screws it up. If I say I'm not, that kind of messes up. So I'm just not saying anything on it. So sorry, Kash. I really just want to respect the Board of the process that they're going through. So I hate to duck a question, but I'm going to duck that one, not because I'm not willing to answer, but I want to respect the Board the process they're going through.
In terms of more tight integration, like, look, we have a lot of information about how games work and how engagement works. So we start thinking broadly what we're trying to do is help game developers maximize their success. And I know for some of that's just great art. But for others, it's making money, and that's kind of where the monetization and the ad piece comes in. And we actually think with what we kind of understand about how people play games and the analytics that we already provide, to some extent, to developers who use our analytics products on how the engine works and how engagement works and how people are using games. We think if we can get a flywheel going with that to do a better job of helping them monetize their ad space. And obviously, we profit from that. So we think there's quite a bit there that we can continue to build on. And we're like literally, early, early, early days in that with a long road map of things we're excited about.
Josh Tilton at Wolfe.
I got two actually. My first one is, can you guys maybe give us a sense or a flavor for what is left to cut at the business since I know that we already did some layoffs previously. And maybe how do you -- like what gives you guys the confidence or how do you guys plan on maintaining that passion internally that you just talked about as you look to become a more leaner business?
Well, I mean, I'll start there. I came from the airline business, so very much kind of focused on making sure that we're kind of operationally optimized. Look, I actually feel like when you actually get efficient and effective, and part of that is just building an operating model and organizational structure to support the core business that you're in. You naturally get much more efficient doing that. And so while it is painful in the sense that we will have fewer people, I think the people will hear, will be very inspired by the mission and what we're going to do is all around kind of our mission and our values. And you get engaged, as you see success in profitable and growing. I feel very, very good that as we come out of this phase, people are going to be both inspired by what we're doing and proud of the success that we're able to generate.
Look, it's just a -- it's a different model to -- versus saying let's spend a lot and hope revenue ultimately passes that and you make money. It's a little bit more, let's get efficient and effective and optimize our business and then scale from there. And so this, I'll call it a reset is a bit of that, like let's get efficient and effective, let's build an operating model that fits the businesses we're in. And then the business that we're in lovely, have a lot of growth in them, and so we scale from there. So while it's painful, in the reset, I think very soon coming out of that. I think people will be able to see we're better able to deliver against our core mission, and we're winning.
Yes. I don't [indiscernible] the question, what I would say is which was -- you remember your question was how do we keep on finding opportunities to optimize our cost structure. So I would say, number one, we're making different portfolio choices, right? And as you focus the portfolio, then obviously, as you exit businesses, you can continue to drive efficiencies there. Second thing we're doing is we'll continue to drive synergies between organizations, with internally and drive efficiencies across the different teams looking at expansion layers and levels and everything else. And last, we're taking another very sharp look at G&A and how do we continue to drive G&A so that most of the dollars can drive the products that our customers love and will drive our revenue margins and cash. So that's what we're doing.
And if I could just sneak 1 more in. From an investor perspective, there's been a string of some interesting news releases. Obviously, the decision not to guide next quarter, the full year is another, I guess, piece of interesting news that we have to grapple with. There's still the -- how do I say this? You're still going to guide for '24 next year, which will be another important catalyst for the stock. I understand that there's a lot of moving pieces and a lot of excitement around opportunities going forward. But is there anything you can just give us in terms of time line of expectation for when you expect growth to kind of accelerate to maybe help ease investors. I don't know, worries around the lack of where the numbers are going in the near term.
I'll start with some comments. And Luis, you're probably better equipped to be able to answer specifically. Look, I think that even as we get into next year, more focused execution generally leads to success in the marketplace. And so I'm thinking '24 already just being more focused you'll see kind of improved gross performance. And then again, we have a whole series of growth drivers that we need to go execute against, those -- we are working through as we kind of do the portfolio work. So we'll have to really talk about that more in '24. But -- when we get -- in February, I guess, the next time we speak with you, we'll be able to give you a lot more detail around that. But I am confident both seeing the size of the markets and our position in those markets. And I'm also just confident without having all the plans laid out for just more focused execution all the time and all of my experiences have seen leads to better performance on the revenue side. So without the full numbers kind of ready to talk about, I'm confident in next year.
Totally agree. We'll give you more visibility with our Q4 earnings. So in a few months. I think Jim mentioned the opportunities big, the portfolio is right that we already have. We just need to be more focused. And as Jim said, we just need to execute. But we think we will -- we're doing everything we can to have a very strong 2024, that's our goal.
And then our last question will be with Jason Bazinet at Citi.
Appreciate you coming in and making these changes so quickly. I just wondered, there's obviously a wide berth that you have in terms of how the magnitude of the changes that you might pursue in terms of pruning the portfolio. Are there any guardrails as you're going through these changes, i.e., no matter what happens, we don't want free cash to go negative or no matter what happens, we don't want EBITDA to go negative? Or is it really -- we may have to go through a period that's more difficult on some of those key financial metrics that The Street cares about because it will paint a better picture in '24 or '25?
I mean, I'll start. I mean, frankly, the good news and the things that we're looking at, it's not like we're peeling off businesses that are highly EBITDA positive because they don't fit, right? I mean we -- I think in a good way, we're investing in a lot of things. And so this is more about looking at kind of peeling off some things that we were doing at that frankly aren't profitable. So I don't think you're going to see a real dip at all even this quarter and certainly not as we get into next year. But Louis...
Yes, I think the only other thing I would add is we're not thinking about a long transition, right? Once decisions are made, which should be this quarter, we will start implementing this quarter will be 100% done next quarter, and that's it. It's not like a business model transition that takes a year or 2 years or 3 years to complete. These are things we're planning to do and execute now.
I think Q1 might be a little because we haven't finished it. But no, I wouldn't think our margins in Q2 would be that different than Q4 next year, right? I mean this is a rip off the Band-Aid reset and then we're going.
That wraps it up, Jim, if you want to have some closing 2 or 3 say hello and then we'll be done.
Yes. So look, I really appreciate your time. I just want to emphasize again that the went up bluntly, when I first agreed to come in when I kind of got the call. I thought, okay, this company has some opportunity. And I'm sure like a lot of companies doing too much and there's some focus. But I have to say I have become more and more convicted in and excited about the long-term growth opportunities of the company today than I was a month ago. I mean this really is a very powerful, very defensible moat of technology. We didn't get a chance to go into that. It's valuable in so many places. And it's a matter of really kind of what is the pathway to focused execution, deliver results on one, add another, deliver on that at another. So it's -- but the good news is because of just the nature of the technology and the fact that it is a platform business, it's very highly defensible. And again, real-time 3D, which 1 could argue is interactive 3D. We're really the only way to do that across myriad platforms at scale. And when you kind of think about the number of areas that makes sense, whether it is consumer products companies, whether that's industrial companies and visualization. Obviously, in gaming, I feel like we have a number of opportunities. Our key is not that. The key is making sure that we build a pathway to profitable growth by executing each of those in the appropriate order so we can continue to deliver results that you can see and be transparent about it. But clearly, that opportunity is there.
Great. Thank you all, and we'll see you in the future weeks and months and over time. Thank you very much.
Thank you.
Thank you.