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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Thank you for standing by. This is the conference operator. Welcome to the Enthusiast Gaming Holdings, Inc. Fiscal First Quarter 2022 Financial Results Conference Call. [Operator Instructions] As a reminder, on the conference is being recorded. [Operator Instructions]
I would now like to turn the conference over to Eric Bernofsky, Chief Corporate Officer. Please go ahead.
Thank you, Arielle. Good afternoon, everyone, and thank you for joining Enthusiast Gaming's First Quarter 2022 Financial and Operating Results Call. My name is Eric Bernofsky, Chief Corporate Officer of Enthusiast Gaming. With me today is our Chief Executive Officer, Adrian Montgomery; and our Chief Financial Officer, Alex Macdonald. We'll begin with some prepared remarks from Adrian and Alex before opening the floor to questions.
Before we begin, I'd like to remind everyone that today's presentation contains forward-looking information that involves known and unknown risks and uncertainties and other factors that could cause actual events to differ materially from current expectations. These statements should not be read as assurances of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. A more complete discussion of the risks and uncertainties facing the company appear in the company's management discussion and analysis for the 3-month period ended March 31, 2022, which are available under the company's profiles on SEDAR and EDGAR as well as on the company's website, enthusiastgaming.com. You're cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. The company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking statements as a result of new information, future events or for any other reason.
Now I'd like to turn the call over to Adrian Montgomery, CEO of Enthusiast Gaming. Adrian?
Thank you, Eric. Good afternoon, and welcome to our first quarter 2022 financial results conference call. 2022 is off to an incredible start. And I'm excited to share with you the details of yet another strong quarter. I will share with you why we are winning in the marketplace and why we are confident that our business model is well positioned to continue to deliver rapid revenue growth, outsized margin growth and deliver profitability in the short run. As always, I will also share some key operational highlights and milestones before handing the call over to Alex to share more details on the financial performance in the quarter.
Our Q1 2022 results demonstrate that our flywheel model centered around communities, content, creators and experiences continues to drive long-term value for all stakeholders, including our audience, our brand partners and, of course, our shareholders. This quarter, we accelerated our revenue growth and delivered substantial margin expansion. And to be able to do that in a quarter that is seasonally the slowest is a strong sign for what's to come for the rest of the year. We are confident that the trends we are seeing will allow us to meet profitability objectives in the short term.
Let me share some of the highlights of the quarter. Revenue in Q1 grew 57% to $47.2 million, up from $30 million last year in 2021. The year-over-year increase was driven largely by: one, higher views across our content channels; two, stronger monetization across both web and video platforms; three, growth in our direct sales channels; four, continued growth in subscriptions; five, and lastly, growth from the addiction Games and U.GG properties.
Gross profit grew to $13.5 million in Q1, up 127% from $5.9 million this time last year. Q1 gross profit was particularly strong and effectively equal to Q4 2021 gross profit of $13.7 million despite a strong seasonal difference between the 2 periods.
Gross margin expanded to 28.6% in the quarter, an increase of 880 basis points versus gross margin of 19.8% in Q1 of 2021. The increase in gross margin is driven by the strong performance of Addicting Games and U.GG as well as the higher direct sales in subscription revenue.
On direct sales, I am pleased to report that this area of the business is off to a strong start for the year. Direct sales grew 136% to $5.2 million in Q1 compared to $2.2 million in Q1 of last year.
Last quarter, I spoke about the success we were having converting new customers into returning customers. This quarter, renewals and additional business with existing customers accounted for 65% of direct sales. That's up from 42% last quarter.
And deal size among our renewals, on average, is larger than deal size for new customers. Again, this is a very important metric for us to watch as it continues to demonstrate to us the value that our flywheel of services we offer brands is helping them convert their spend with us into new customers for them. Some of the larger renewal partners we work with in the quarter include the United States Navy, HBO Max, the Truth Initiative, DoorDash, e.l.f Cosmetics and H&R Block. While some of the new partners include Hut 8, the FDA, Coca-Cola, Toyota, Puma, Wendy's, Fidelity, to GG, Lionsgate and Red Bull.
Turning to subscriptions. Revenue grew 83% to $3.3 million, with paid subscribers increasing 70% from a year ago to end the quarter at $233,000. One point I'd like to emphasize here is that revenue grew faster than subscribers, meaning the ARPU, the average revenue per user, on those subscribers increased slightly in the quarter. This proves the value of our subscription offerings to our audiences and the ability for us to maintain pricing power.
Again, to reiterate, 2 of the main reasons we have been able to grow margins at twice the rate of revenue growth is the contribution coming from higher-margin areas of the business like direct sales and subscriptions.
And at this point, I would be remiss to talk about the exemplary leadership on the operational side of our Chief Operating Officer, Thamba Tharmalingam, who every day drives efficiencies across the organization as well as the strong growth that is reflected in these results. Thamba would normally be with us tonight, but he's waving the Enthusiast flag at Adweek Europe's, which has emerged as a priority growth area for the company.
On my last CEO update, I talked about how we are taking tangible steps towards the goal of increasing our content vertical of the business. Last quarter, I spoke about making the right investments and the decisions for the company to position ourselves at the intersection of gaming culture. As audience preferences evolve and grow, we are taking a hard look at how we create content, asking viewers what is important to them, what product enhancements, features, formats would they like to see. We asked a lot of questions and, of course, how can we monetize that new content.
One thing we have witnessed, as I'm sure many of you have, is the speed at which TikTok is growing. It is the fastest-growing social network in the world. Over the past year, we have dedicated resources to TikTok. We now have 16 Enthusiast Gaming owned and operated TikTok channels, generating 50 million monthly views and growing. The content we are producing is extremely diverse but relevant to our fans and our audience. We have shows that focus on news, guides, culture, entertainment, streaming, top 10 lists as well as game clips. We believe there is tremendous opportunity for brand partners to have a much greater presence on TikTok and we are already engaging with leading brands and organizations on this. And in fact, we have already begun monetizing on this platform via a recent custom integration we did with DoorDash.
It's amazing to see the innovation happening in real time with our content and sales teams being able to ideate and execute on an idea that brings value to audiences and can be monetized with our brand partners.
Turning to Luminosity Gaming. The most watched esports organization on Twitch, Luminosity continues to move forward. Luminosity is a cornerstone in our asset portfolio, and we are focused on continuing to grow market share. Subsequent to the quarter end, we announced that we have entered 2 new game titles, including our return to Halo and our new Apex Legend's teams.
In conclusion, we delivered a very strong Q1 in the face of seasonal weakness in a difficult global economic and geopolitical environment. We accelerated our revenue growth and grew gross profit at twice the rate of revenue.
I would leave you with 4 key messages for 2022. One, we will continue to focus on strong revenue growth. Two, we also expect margin growth to continue to significantly outpace revenue growth as seen both in this quarter and in 2021. Number three, with the surge in gross profit, we have the available capital to execute our business plan. And finally, given the operating leverage of the business, we are on an accelerated path to positive EBITDA and in the latter stages of this year.
I will now turn the call over to Alex for further commentary on our financial results. Alex?
We are off to a strong start for the year with this impressive quarter, our first quarter 2022. Before I begin my commentary on that, here are my usual notes. I note that our results are presented in Canadian dollars. I note that a significant majority of our revenues are measured in U.S. dollars and are translated into Canadian dollars for presentation in our financial statements. The exchange rate between the U.S. dollar and our presentation currency of the Canadian dollar should be monitored and considered when analyzing our forecasting results.
And I note that our business is affected by seasonal trends in digital advertising, with sequential increases each quarter throughout the year driven by increasing ad prices and demand, which peaks in Q4. The seasonality is isolated to our media and content revenue streams. Q1 is seasonally the slowest quarter.
But now let's talk about Q1. Q1 revenue was $47.2 million, up 57% from Q1 2021 revenue of $30 million. Q1 revenue by source was as follows: media and content, $41.9 million; subscription, $3.3 million; and esports and entertainment, $2 million. The Q1 media and content revenue of $41.9 million compares to a $27 million reported in Q1 2021, an increase of 54%.
This increase was driven by the following. Number one was higher demand for our inventory. This increased our RPMs on both our web and video platforms. Our web RPM was up 64%, and our video RPM was up 28% year-over-year in Q1. Number two was more inventory. Total views of content were 11.3 billion in Q1 versus 9.9 billion in Q1 2021. Number three was more direct sales. Direct sales were $5.2 million in Q1 versus $2.2 million in Q1 of last year. And number four was strong performances in our 2 larger acquisitions from 2021 being Addicting Games and U.GG.
Q1 subscription revenue was $3.3 million, up 83% from $1.8 million in Q1 last year. This increase was driven by an increase in paid subscribers which were $233,000 as at March 31, 2022, compared to $137,000 as at March 31, 2021.
Q1 esports and entertainment revenue was $2 million, up 67% from $1.2 million in Q1 last year. This increase was mostly driven by the return of live events. The company was able to host live events in key markets in Q1 of this year and anticipates being able to do so going forward. The ability to host future live events will depend on the regional public health regulations and guidance prevailing at the time.
Gross profit is likely the most notable result from the quarter. Gross profit was $13.5 million for Q1, up 129% from $5.9 million in Q1 last year. Notably, Q1 gross profit was also within 1.5% of Q4 2021 gross profit which was $13.7 million despite the seasonal effects which, typically, makes Q4 strong and Q1 weak. And once again, the year-over-year growth in gross profit on a percentage basis while exceeds the growth in revenue, as reflected in the gross margin, gross margin was 28.6%, up 880 basis points from 19.8% in Q1 last year.
Since we acquired our video network in Q3 of 2020, we have consistently, every quarter, improved our gross margin. On a year-over-year basis, the 880 basis point improvement is driven by the increase in direct sales, the increase in subscription and the acquisitions, including, most notably, as mentioned earlier, very strong performances by Addicting Games and U.GG in Q1, both of which are high-margin businesses with strong growth curves. This strong performance, along with the return of live events, also contributed to the notable sequential improvement in gross margin Q1 over Q4, which was 460 basis points.
Operating expenses were $24.8 million, up from $18.7 million in Q1 last year and down slightly from $25.7 million in Q4. Operating expenses, excluding amortization and stock-based compensation, were up approximately $1 million Q1 over Q4, which is attributable to the esports player team and game expenses returning to normal levels after a onetime reduction in Q4. Outside of this, there were no material net additional operating investments in Q1.
Net loss and comprehensive loss was $12.2 million, down from $13.6 million in Q1 last year, resulting in a net and comprehensive loss per share, both basic and diluted, of $0.08 in Q1, down from $0.12 in Q1 last year.
Cash used in operating activities was $7.5 million, including $2.1 million from changes in working capital. Most of the working capital movements are from the paydown of the working capital adjustment stemming from the U.GG acquisition in Q4 and accrued year-end expenses paid in Q1. Excluding working capital adjustments, cash used in operating activities was $5.4 million in Q1, which is expected to be the bulk of the cash used in operating activities, excluding working capital movements for this year. We ended Q1 with $14.1 million of cash and an operating line limit of $5 million for total liquidity of approximately $19.1 million.
We remain of the strong opinion that the results of operations and the financial condition of Enthusiast Gaming has never been stronger. The seasonally weakest quarter of the year is now behind us, and there was nothing weak about it. It was our second highest revenue quarter ever, next to only the seasonally high Q4. Also, it was our second highest gross profit quarter ever, again, just marginally less than Q4. In our business, when your Q1 looks and feels like your Q4, you are set up for a very strong year.
And we strive to be transparent and forthcoming about our plans. And I wish to elaborate on how we view growth, which we spoke about at our Q4 call. We have continually expressed confidence in our ability to continue to grow the company. We do believe that nothing will stand in the way of our growth. However, this confidence does not come from an ability or desire to inject operating investments. Rather, it comes from what we observe in the KPIs of the business.
Year-over-year, our content views are up. Our CPMs and RPMs are up. Paying subscribers are up. Direct to sales are up. And most notably, gross margin is significantly up. Our confidence in these trends is bolstered by the fact that they are across a diverse portfolio of products: on web and video, on desktop and mobile. This is where our growth confidence comes from.
At the same time, the business is on the verge of a gross margin, which allows for self-sustainability. Against that backdrop, we have entered a period of stability in operating expenses. This will be coupled with the continued benefits of the tailwinds of our macro environment, the tailwinds of the trends in our internal KPIs and, from now until December 31, the tailwinds of seasonality. This will help us demonstrate to the market the earnings potential of our ecosystem. But we certainly still regard the company as early stage. When it comes to the scale of the business, we still believe we are just getting started.
I wish to thank all the analysts for their continued work on the company. I also wish to thank our shareholders and other stakeholders and, particularly, the people of Enthusiast Gaming who I am honored to work with. They remain, in my judgment, our most valuable asset. This Q1 has shown that there may be seasonality in our business, but there is no seasonality in the people of our business. And of course, ladies and gentlemen, our business is the business of gaming.
Thank you. Operator, back to you.
[Operator Instructions] Our first question comes from Mike Crawford of B. Riley Securities.
So I'm hopeful you can quantify the margins and growth curves at U.GG and Addicting Games. And just maybe, in conjunction with that, can you give us some color on the NFT launch last week that went live at EV.IO.
Mike, this is Alex. So Addicting Games and U.GG, look, they're strong contributors. And I'll quantify it this way, they're still less than 10% of revenue but they are high margins. So that's not a onetime thing to the gross margin, which I suspect you may be trying to understand, that huge leap in Q1. I mean that's real. It's not onetime. They have strong growth curves. They are high-margin businesses. But to quantify it, I'll say that they're still less than 10% of overall revenue.
And then I think that NFTs went live just a few days ago in EV.IO.
So we did have a very successful, and we're extremely proud of the team at Addicting Games, NFT launch. I believe we are over 4,000 units or so NFTs that we minted. That sale ended. I believe it was Sunday, overnight. And it's very fresh. But there are 4,000 more NFTs in the market now that were minted by Enthusiast Gaming and, particularly, by the people at Addicting Games. And one thing I do want to point out, as a gamer, I love this aspect. These NFTs, you buy them, you can wear them in the game as you're playing, EV.IO. So it's very new technology. It's very cool. I think it was over 4,000, or approximately 4,000, units were sold. And that's fresh off the presses. That sale just concluded over the weekend.
Excellent. So I don't want to ask too many, but I'll just go one more. So I'm glad to hear that OpEx appears to be on a flattened trajectory, and you committed to a positive EBITDA in the latter stages of the year. Does that mean in Q4, maybe Q3? Or is there any more quantifying you can do around that? And then further, should we take that to expect positive EBITDA and perhaps even free cash flow for the whole of next year?
Sure. I mean, look, I will say, for the back half of the year -- I don't want to create a milestone, how do I put it, prejudice around that 0 number, whether it's $1 or a negative $1. Materially, it's there's going to be significant improvements throughout the year, which will lead to profitability. Whether or not that trips in Q4 or Q3, I don't want to turn that into an unnecessary KPI. But there's going to be material improvements. OpEx is very stable. And we described a bunch of the growth metrics, which give us a lot of tailwinds to work out the rest of the year. As for next year, the answer to your question is yes.
Our next question comes from Rob Young of Canaccord Genuity.
Last quarter, I think I came away with the impression that you're going to see gross margins sequentially improving through the year, so up in Q2, Q3, Q4. And so it strikes me that this might be a quarter where the gross margins are quite a bit stronger than you expected. And so would you still expect to improve sequentially through the year off of this base?
Rob, it's Alex again. I mean the answer is yes. It is very strong results, and we're proud of it. Certainly, it didn't surprise us, but we are very pleased. And yes, we expect continued incremental gains on the gross margin. That's what we set out to do. We've said that for close to 2 years, I guess, now. And we've done it every single quarter, we want to continue to do that. I wouldn't expect, of course, 460 basis points a quarter. That is not normal. I think in the past, we said, "Look, if we can do 50 or 100 basis points a quarter, then that's fine by us." And I would expect continued gains on the gross margin.
All right. And was my premise correct? Was it a surprisingly rich quarter for gross margin? Or did it come in, more or less, in line with what you expected?
We're pleased. I will say we've even surprised ourselves in many areas, and gross profit and margin were one of them. But we've had a chance to absorb that and measure it, and it's going to continue.
But what we've always said to you, Rob, is we very much have built a business that we see as a 21st century media and entertainment company and a content company. And we think, and have always thought aspirationally, that the same gross margin profile of those traditional media and entertainment content companies is something that we should be able to achieve. And that's north of 40%. We're trending across that, and we're getting to it. And really, it comes from owning more of our ecosystem, producing more of our content for our audience, and we've really started to effect that pivot of a company that is more proprietary in terms of the things that we do to generate that engagement with our audience.
Okay. Great. Last question for me, I guess, before I pass the line. It would be on the big jump in the same-store sales, the repeat business, I think you said 60% plus. What is the driver of that? Is that seasonality? Is it just that you see less new customers in Q1? Or is there something else at play? Because it just seems like a big jump.
Yes, it is a big jump. And what it represents at the very, very heart of the matter is that the customers that we've been working with are generating the results that they're looking for by using this one-stop solution called Enthusiast Gaming that creates bespoke content, that creates esports sponsorship and that really wraps our arms around fans and generates results for them. And so when we started with the direct sales effort in 2020, as you recall, we did a number of tests and private marketplace deals and, really, we cast the net widely. And now what we're finding is that people are doing more and more and more with us because, if you're an HBO Max, if you're a Disney+, you're only coming back to the well with a partner if they deliver and they convert for you. And that's what we're doing.
And we're seeing larger and larger spend from our existing customers. And it is a big jump. But what it also does in a quarter like the first quarter, which is seasonally the slowest quarter, is it sets us up to get more and more revenue visibility as we grow the business. And as you well know, that's a great and encouraging place to be when you have more and more visibility over your revenue going forward. And certainly, that is evidenced by the fact that we're growing our repeat business with some pretty, pretty strong brand names.
Great. And just to put a finer point on it, when you're winning new business with new logos, is more of that likely to come in the second half when the seasonality benefits, but as you are getting this repeat business, that sort of sets up more stable sort of a repeat business through the year and so just maybe accelerates the back half of the year when the new business starts to come back? Is that reasonable to think?
Yes. I think that's generally fair. And I also think that more and more companies are taking bigger and bigger steps into the world of the gamer generation. And so there's going to be more and more companies that are going to -- look, again, if H&R Block and State Farm Insurance have recognized the connection between Enthusiast Gaming and the ability to convert new customers into the life cycle of their product offerings, more and more companies are coming to that realization every day. And so we expect that to continue throughout the year and in the years to come.
Our next question comes from Drew McReynolds of RBC.
Yes. Certainly, relative to my forecast, you kind of blew it away, which is good to see. A couple of follow-ups here. Maybe, Adrian, just on the size of campaigns, you know who you're dealing with and what kind of campaigns they run. Do you think you're in the early phases of those campaign sizes? Is there still some runway to go? And then, secondly, just on seasonality. I think we're all aware of the seasonal aspect of your business. Just in terms of your current asset mix and the run rate that you have, are you able to just fine-tune that seasonality for us or at least give us an update just broadly on how the quarters play out from here?
Sure. I'll answer the first question. We're seeing the budgets and the campaign spends go up each and every week, it seems, because there is more and more recognition, as I said, of the relationship between the gamers -- and the companies need gaming as a conduit to get young people to pay attention to them. And so what's happening is that realization is coming. They're shifting and prioritizing their spend into this world. And they're realizing, through the great efforts of our sales teams and our customer activation teams, that Enthusiast Gaming is effectively a one-stop shop for them.
Some companies in the past have said, "Look, we recognize the importance of gaming influencers, and so we've gone out and spent some money with influencers. We recognize esports is becoming more and more prevalent, and so we've done a separate esports sponsorship. We also know of the power of that YouTube inventory and some of these popular channels. So we've done a bifurcated spend over there. And, oh my gosh, you have all of that, and you can give us all of that access and all of that placement and all of that content."
And so we're winning in the market as a result of the diverse mix of assets and the fact that they collaborate with each other. And so we're seeing the spends and we're seeing the RFP sizes grow substantially, and we're winning a disproportionate share of that business. So we're very excited about how we're placed to continue to profit on the direct sales side.
And on the seasonality, I'll defer to Alex on that.
Drew, it's Alex. So I mean, quantitatively, and this is a bit rough. But typically, what you would expect in the ad market quarter-by-quarter would be something like 15% in Q1, 25% in each of Q2 and Q3 and then just 35% remaining in Q4. What we've seen this year, though, the ad market was actually quite strong. I did speak of our demand in my prepared remarks. There was a notable increase in ad spend in Q1, which helps outpace the seasonality. That's a macro effect. So whether or not that will tighten the range for the year, is to be seen. So I think that range that I gave of 15% growing to 35% in Q4, I would suspect it may be a little tighter of a range this year just given the strong start. But that's generally what you would expect, to see for seasonality in the digital ad market, which, for us, affects our media and content revenue streams.
Our next question comes from [ Kevin Mackey ], analyst.
Great work on the quarter, some impressive numbers. I've asked this before, and I'll ask it again, so I apologize if I'm bugging you, but any update on the return on ad spend that some of your customers are seeing.
Sorry, if you could specify that.
Sure. Most of the resources I've seen have broken it down between like return on ad spend for radio, return on ad spend for TV, if you're seeing numbers comparable to any one of those. Or basically, what I'm getting at is why are these customers coming back? Are you better than radio? Are you better than TV? What information can you share with us there?
Yes. Sure. I think that where we're different and where we're winning in the marketplace is we're creating very unique solutions for our clients where scale media is an important part of that bespoke solution but it's not, in any way, shape or form, the beginning and the end of that solution. The custom content that we created: we created an animated episode for DoorDash, introduced a new character, we have esports sponsorship, we've got the Top Gun 2 movie premiere next quarter where we've created a whole new content activation with a big, big gamer called Ludwig. And so what we're driving is we're driving impressions, we're driving brand awareness metrics. And in the case of, as I said, the HBOs and the Disneys, we're converting subs for them.
As it pertains to some specific metrics, and I think I mentioned this on the last call, our YouTube inventory has over 90% viewability and over 90% completion rates and someone like yourself would know, to be an industry leader in that category, you need 70% viewability, 70% completion. And so to be delivering over 90% on both those metrics is very, very strong for us and for our customers. And what it means, in very simple terms, is that our gaming audience is ready, willing and able to sit through an ad to get to the content that lies on the other side of it. So I would point to the 90% viewability and completion rates as one metric.
Great. My question also has to do with seasonality as some of the others have brought up. I'm wondering if some of your seasonality might start to attach itself to some of the bigger events in the video game world. For example, the League of Legends World Championship happens midyear or something like that. So do you expect to see some seasonality in that regard and you intend to do some targeted spend to enhance that? And might that even things out as opposed to kind of a more vanilla ad agency?
Yes, that's a really good perspective. And I think it speaks to the diversity of the assets that we have. And so we've really focused the business around 4 pillars, which is communities, content, creators and experiences. And whereas some of our traditional media competitors might say, "Look, Q1, you're not going to find Hollywood blockbusters premiering and people waiting on line to go to the theaters and watch a Marvel movie until after Memorial Day," we were able to draw on the lever of the return of Pocket Gamer London in Q1, which was a tremendous success for us.
When you speak of the League of Legends World Championships, those are in November. But whether or not they were in November, the fact that we own the fastest-growing League of Legends fan community in the world, being U.GG, we're starting to have very, very advanced conversations with companies who may have spent with the League and with Riot but now recognize maybe there's more of a 12-month program we could put behind League of Legends, and we can do it with U.GG as opposed to as opposed to the official League of Legends organization.
And so we have a number of levers to draw on that might contribute to flattening out seasonality. But generally speaking, Q1 is slower than Q2, which is slower than Q3. And then Q4, you have the bonanza of holidays and Thanksgivings and all those sorts of things.
This concludes the question-and-answer session. I would like to turn the conference back over to Adrian Montgomery for any closing remarks.
Thank you very much, and thanks to all those who have tuned in to our Q1 call. As you've heard from us, we're really excited about the growth that we're seeing in the business. We're really excited about how Q1 has positioned us for further growth and momentum throughout the year.
But I'm just going to use my closing comments to thank all of our stakeholders, our analysts, our shareholders. But for me, the people of Enthusiast Gaming, Alex said it in his remarks, they are our greatest asset. They are our secret sauce. The passion, the creativity, the innovation, the collaboration that they demonstrate each and every day is what is driving this performance and driving these results. And I just want to say thank you to all the people of Enthusiast for making us a better company each and every day and for giving Alex and Eric and I, and Thamba when he's not traveling, the confidence to present this performance and the pride that we have in the business that we're building. So thank you, Enthusiasts, and appreciate everyone's time today on the call.
This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.