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QUOT Quotient Technology

Participants
Stacie Clements Vice President, Investor Relations
Mir Aamir President and Chief Executive Officer
Ronald Fior Chief Financial Officer and Treasurer
Steven Boal Founder and Executive Chairman
Shweta Khajuria RBC Capital Markets, LLC
Jason Helfstein Oppenheimer & Co. Inc.
Ralph Schackart William Blair & Company
Thomas Forte D.A. Davidson & Co.
Steven Frankel Dougherty & Company LLC
Nathaniel Schindler Bank of America Merrill Lynch
Call transcript
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Operator

Welcome to the Fourth Quarter 2018 Quotient Earnings Conference Call.

During the call, all participants will be in listen-only mode. After the presentation, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded and will be available for replay from the Investor Relations section of Quotient's website following this call. I will now turn the call over to Stacie Clements, Vice President of Investor Relations. you. Thank Ms. now may begin. you Clements,

Stacie Clements

on you, everyone, of fourth slides our welcome available remarks our corporate website. Hello and Thank to the full-year section the that and quarter note XXXX to Please are operator. earnings IR call today's accompany on call.

On the available is Chairman, Mir prepared here well and today me questions Aamir, CEO; after and remarks. Executive President call Boal, Fior, Ron our with for our and our are our CFO. Steven as

that note statements. growth please for begin, in this include call, for as forward-looking we Before pricing quarter drivers expectations hear will during as investments well our XXXX; the These projections business strategies, you platform; solution, partnership, our statements expected generally. forward-looking and and and growth our first full-year of

based known information good cause that risks of the could you and are differ materially. of management and statements call and or actual to this performances to on are team the our available subject unknown time as results beliefs to faith uncertainties Forward-looking and of

any disclaim filed exception deck the over And Company's between non-GAAP I'll measures website. can turn with today basis on release have exclude issued and information, call in be about a of to today's found A in certain to result the financial note Additional revenues, with in financial the can Report our the results margin non-GAAP SEC future could our risk the GAAP a Form Please today impact posted that identified potentially X, XXXX. found measures operating of events statements, whether are on been November on We loss, Quarterly on and update Mir. contained new forward-looking expenses, XX-Q information obligation net the reconciliation and discussed now these gross as that that, in in and adjusted in to release or be otherwise. factors press financial and press factors the with information slide expenses. result

Mir Aamir

Stacie, XX% XX% welcome, everyone. was an strong year over XX% We XXXX over in growth We up investments. XXXX over exciting in over compared EBITDA XXXX sheet operations and with year. million $XXX $XX revenue dollars Adjusted in the Thanks, a as XXXX. delivered accelerated cash with and from last up were ended balance and XXXX million generated in year. short-term cash growth

Ahalogy, Media We a strong the year, We the $XX stock marketing significantly and with common entered the the shares Elevaate. our year. enhanced platform of about our with repurchased our on solutions Performance to and of million. solid excited XXXX During business and we technology expanded Savingstar this launch of for grow at footing we acquisitions strategic Retail continuing pace are

the Let's softer last over in in was anticipated customers start despite the QX was spend up for quarter year. quarter CPG a with year, Revenue million fourth the million, $XX.X QX year. XX% over fourth XX% increase last of $XXX December and last record record a EBITDA quarter. than Adjusted

by retail and the was increases, impacted as cut default solutions at marketing through Ahalogy to environment, CPGs the reductions revenue cost fiscal of data CPG including as most, easier CPG well year time industry X% rapidly tariffs newly as including XXXX. changing and proliferation by spend commodity driven pressuring is We end macroeconomic in mentioned to business. impacted little the the faces spending label end products. lead was environment, quarter. our we Media preannouncement, our marketing revenues believe unexpected social was during influencer margins, private enabled As a some uncertain and Digital lower the requires attributable quarter of and December. over QX QX cut last acquired grew marketing by declining and media over their spend XX% softness year, Promotions in our

XXXX enabled for use to sometimes growth our on the to of expect side, result, search a offline. and on digital include platform. on the expected social can year, search digital to e-commerce, strong are it or a campaigns this they launched shoppers shifting our for marketing and advertising platforms an catalyst basis, and data, quarter digital. marketing is about favor, ad predict, our to powers RPM are on basis. an Brands deploy According in of brings the exhibit on to shift digital significant brands to seeing from Performance annual timing also spend promotions, of are built minutes. data solution I'll opportunity are from media play quickly promotions, expected that we ads a to it billion coupon and spend our CPGs our as come where deliver be to budget Media strong media annual That's we that measurement. dollars suggest CPGs for continuing, trends media, to solution of technology alone, Retail each analytics. These billion is that and still our eMarketer, in the and with foundation data tech digital we platform and XXXX, business retailers display looking XXXX. few or gain excess In by efficiencies On $XX CPG the to to to receptivity RPM, media of targeting dollars packet integrated back seen growth most Retailer to on and and iQ, together business marketing digital is and driven $XXX why Quarterly in social dynamic brands out flip the it hard in digital have which balance our continues but we've at a ads.

that combine and for third also QX. ad Albertsons Since our digital RPM is exclusive in experiences. the followed in digital launched frictionless last largest on General now sales. signed media strong largest another demonstrated in to retail year, a shopper one which the U.S. for chain billion RPM last brands Quotient Quotient retailer's Dollar retailer, U.S. the has scaled programs we've supermarket Companies, transaction the making commerce media Amazon and earnings partners represent digital U.S., in data second the that grocer digital largest loyalty align partner personalized actual Delhaize, six $XXX us the As with to Ahold platforms together call, who content, can U.S. large grocery media retailer early data, by retailers, is solutions of have almost and demand spend launched relationships. through already all connected CPG landscape.

search on and CPGs other billion data with our through properties We on Quotient also can powerhouse. drive also spend Sponsored search In Google, platform media our that to spend we a our in Elevaate. of ecommerce with now web recently Amazon, platforms. and digital Search XXXX, also the to CPGs measurable Technology acquisition partner sales. about elsewhere added became budget retailer $X.X

enabling XX a custom for in on coupons.com Retailer strong visitors new audience we Quotient a XXX our brands by audience seen to actual iQ, We've programs at sales. approximately we XXXX, monthly catalyst a Analytics, based on buyer created and platform We revenue client We mobile million data, shoppers for have based also have We've analytics on-demand registered properties. unique of shopper real efficiently time. powered premium audience ads in campaigns over on segments near X,XXX measures as verified over Earlier launched on million XX million transaction relevant consumers data that develop growth. segments audience now drive and with over to clients serving reach price. specific segments adoption data

audience our significantly data modeled the this we've of targetable XXX% of almost of rich expand with to adults. scale potential reach Additionally, the U.S.

are excited we year-end launch. RPM our head is As additional about growth drivers. yet to XXXX, we market just with into a many retailers

into platform soon expect our We following. first retailer launch quarter are with to integrating our our this search ecommerce sponsored other and media technology

Use do We media and our audience helping to of continues started with monetize campaigns. build, to have segments significant customers our measure Quotient optimize Analytics to targeting more plan and clients. for

We a CRM campaigns. our and solution into to platform bring Ahalogy, for through influencer micro-influencer best-in-class media great build to over time. measurable of brand loyalty across repeat CPGs solution traction retail uses by social have rewarding purchase We've CPG proprietary recently retailers with for targeted, social shoppers content launched a a which media

with time customers campaigns laid This digital year. we ROI-based A also iQ describes across four more of retailers they XXXX industry CPGs checkout, several a increase CPGs our We campaigns and that and brand checkout. reflect foundation broad unifies a the launched results the fully on continue XXX% this engine we past been and are experience XXXX in marketing quarter connective set this solutions Promotions number around that integrated marketing Cloud. offers strategy mid-year printed at more are coupons digital such package that that sales. ties This Albertsons Media position coupons, as bringing we digital Retailer enter fiscal our positioning extending and all value cloud and our by this established Xx narrative as and expanded all focused with Cloud, at solution. consumer a the recently cycle pilot to pricing signed With platform incremental reach converts their exclusive deliver versus to promotions, platforms, expertise at and have to include announce technology targeted in Audience I'm gives in be cycle. increase checkout that and solutions our we over printed the coupons reach, Analytics intelligence end coupons, or targeted Additionally, updated brand to in the and our for retailer. Last grow of excited integrated capability content data of and around to shoppers leadership immediately with directly budgeting their our unparallel solutions activation. targeted to reflects with positive year, solutions, and our new shopper digital we've proposition caution We creative Campaign to whether Cloud, integrated provider a printed data. Cloud, to brand media retailers. positioning shopper and have better expanding for have go-to-market

focus another unique grocery. into monthly and our within XXXX consumer intent have behavior great relevant flagship and experiences. consumer Lastly, growth brings great content insight property is $XX consumer for in mobile avenue we million our With purchase coupons.com, promotions that approximately on visitors,

as at the just have sponsored such We in excited XXXX initiatives and strategic search in coupons our I outlined and checkout. about now printed very potential investing growth

in are digital. an I a about and years CPGs in summary, promotions, including $XXX confident in We for will on transformational and accomplishments increasing was I'm search to very business and over our future now annually focus The be turn social Ron. the call our marketing growth year will next media, million XXXX opportunities. few many of investing growth. with us. spend In

Ronald Fior

million of while But increased $X.X $XXX search and and escrowed paperless Revenues, revenue short-term million. Mir investment $XX.X fair business. million of in fourth used discount despite with quarter XX% expense drive in total CPGs by debt, the a over to interest Mir, of without to XX% to on over specialty and you, XXXX. total Retailer up coupon representing primarily $X.X In of grown We net in X% that print. larger earlier. buyback over the non-GAAP fourth the These by revenue sponsored the of loss full-year Thank at in revenue. product cash a million and million grew over capabilities balance XXXX XX% investments net XXXX retail Ahalogy new quarter M&A the and XXXX. driven over over quarter’s full-year in have down, were approximately to our and margin XXXX. These value XX% media, the year of the reduced operations growth is on including XXXX payments, gross grow a digital burnout, million, the contingent performance a mix. topline grew software driven majority results retail million summary, program. to great EBITDA GAAP the quarter our employees, a in growth our year full-year and iQ, were in XX% full was and record investment million of QX customers year. XX% continued exclusivity everyone. in shift attributable X% XX% would net debt XXXX. X% and ended by revenue top combined $XXX $XXX.X of versus amortization absorbing their accounted due we consideration over and approximately digital and was top Retailer came revenue in a primarily the or adjusted softness handle for QX included million our Revenue reduce $XX.X Total Drilling margin in related the Crisp our operating was flow headcount XXXX. were in a grew and for XX expanded expected several decline quarter XXXX. $XX.X Three our was expenses and cash last XXXX. technology social a offset CPGs, shares. revenues partially grew The softness; partnerships and marketing, compared at of of of quarter Net recorded and up change was welcome, year-on-year, by revenue $XXX investment for and We X% impact XXXX over iQ our for agreements with GAAP in efficiencies a a revenue a strategic described just marketing, marketing. retailer growth loss growth $XX three from XX% the from and promotions million, all the XX% while acquisitions expense XX% in convertible over influencer revenues paperless and reduction impacted QX year revenues decline, XX% shopper influencer stock fueled digital decline Promotions decline XXX fourth our in to decline from from million EBITDA paperless of of CRM in total Media by by XX% promotions fourth specialty and retailers was the $X for GAAP, retail. offering profit net GAAP media areas cash QX coupons and

While XXXX us on grew top in XX the by over with their XXX% to customers spend XXXX. media side, compared our

are within Our integrated, to reflecting budgets tightly dollars marketing CPG trend between growing departments. business solutions marketing the converge

our As on customer revenue total be we from growth have set, to our focus continues base.

we'll For total report Retailer only to which quarter, next will customer the growth revenue. by customer and after promotions media separate continue iQ we

same media at Looking with XXXX. CPGs, and top by growth include grew by with over in total over XXXX. XX us which Those customer customers XX% us their media, XX% promotions customers grew XXXX total revenue spend amongst spend our their

us companies the Excluding their by companies the grew back in remaining cut significantly spend XX%. that three over XX QX of with

Let's look at transactions.

after plan our growth to across around the number focus report. QX our XXXX dollars Given in our total discontinue providing customer base, transactions of we

down As in year-ago we of it sequentially. believe the no of quarter longer is XX% health $XXX and fourth the indicative the from a business. million transactions down were XX% Total

For record represented Digital the for the year-ago transactions XXXX. transactions X% grew a were of decreased from from XX% a $X.X year, XX% and year-ago. Digital over up total XX% transactions total full-year. billion, a print transactions paperless

find of quarter mix. gross release to tables margin, result the you and interest in presentation. margins can behind of the around on accompanying which numbers P&L. our in ongoing focus my in I'll the year-over-year Moving earning in shift be the to about the by Gross impacted color In the fourth continued and most the actual time, less comparisons, remarks product press

to in make multiyear retail services data impact margins. continue solutions investments partnerships, will relationships, We technology and gross which strategic

points expect dollars. will margin impacted some by that. We couple as mix. benefited in and gross QX There We long-term media believe of operations opportunity the of additional XXXX these percentage to gross around revenue result in optimization margin non-GAAP delivery another in total of shift from investments and revenues is growth continued be for will drive our and the

our percentage Operating mix the the in actively over business, absolute continue months to the continue than expenses exit over contingent costs, in significant net Non-GAAP expense other restructuring in expenses to next product full-year months, costs, and down as revenue. Partially of including in were still charges change acquisition for greater manage compared an and benefit XX consideration. and to the optimization. to by were value the for costs employees, to operating is operating expected absolute escrowed the the fair a we expenses, XXXX. impacted operating However, leverage be from offset slightly GAAP shift from but down as and dollars grow XX Full-year increase impact due facility expenses with our of we to primarily related dollars improvement XXXX, efficiencies, XXXX. up operating compared slightly the severance to shares

adjusted percentage compensation, of certain Amortization expenses declining costs a of QX fair of in income revenues. contingent restructuring our excludes implementation interest exclude and million net expense acquisition-related up value XX% costs, operating acquisition XXXX. escrowed $XX.X to restructuring XX% Adjusted change escrowed value consideration. net contingent of in depreciation shares and expense, As Adjusted costs, ERP taxes, consideration, fair and revenues in continue XX% operating expenses and was non-GAAP certain charges. acquired of million the EBITDA implementation revenues change costs. stock-based from compensations, leverage ERP EBITDA, the income to intangible show shares Non-GAAP other related assets, and $XX.X of from amortization, EBITDA and stock-based charges,

In buyback program gross by margin and a the For through of of flat million expenses shift we $XXX one-year a represents plan. to an offset $XX.X reflects up record on the due essentially revenue the from XX% the adjusted XXXX. XXXX, as to approximately a XXb-XX up growing non-GAAP and million a buyback. pressure and EBITDA, delivered XX% May XXXX combination in window we in open announced plan of operating to margin, decrease a of impacts mix. product compared XXbX-X year, of Stock This stock

approved the $XXX of approximately approximately million million shares back program. X.X we bought have million used of February, $XX As and

ways more aggressive. on this are to and We looking will we be be at front might continue opportunistic

short-term We cash payment on and $X.X operations reduction with successful burnout down the partially Crisp retailer down quarter prior for our million The the offset can by was cash. the and from certain three flow attributed the full-year cash million. to acquisition, the of companies, cash million from operations. acquisition $XXX.X the of from of generated at from and ended GAAP partnerships, $XX stock repurchase year the million $XXX.X to investments in in program investments, XXXX. end Moving the be year

from million Crisp the year, to back up corresponding balance our operating included to last of year. in of cash in primarily cash receivable the years attributable the from generated million, $XX.X activities, higher was that revenues portion operations for excluding decline During the down the used burnout increase we with half the $XX.X the

talk now Let's about guidance.

Some color first.

We expect back half stronger in due a number drivers end to year two, the the than QX, of impact revenue plan to starting coupons the be drivers growth is stronger the growth one, our promotions of retailers seasonality. checkout, towards this and towards on and Investments Remember sponsored in of printed the Media. year; search, to also year adjusted throughout solutions including targeted launch we XXXX. on Retail for or as focus we year these at will EBITDA Performance more media RPM

in our ready addition, the to privacy go into the regulations effect for we technology invest In to be U.S. expected to plan XXXX enhancing in in

estimating We of $X approximately are million at in expenses. investments the these impact operating

to to of million of the $X first we million For particular, adjusted be quarter softness million expect from to to in XXXX, be promotion as and range promotion million. where to the spending. down In QX CPG $X range lower with of million we continue over to the see XXXX, $XX clients three $X of EBITDA $XX we our we expect spending expect be in

reset, are sales the revenues our the cost is sponsored launch. with in impacted adjusted being the where QX annual in quarter early EBITDA expected and of by meeting investment new First solution FICA annual negatively search

of million $XX is of to revenue in to midpoint. to range of For $XX Adjusted the $XXX the XX% the be million expect expected range the we XXXX full-year at of revenue in growth at or XXXX, or midpoint. million, EBITDA for the approximately approximately $XXX full-year XX% the million

be XXXX. compensation stock-based to up modestly expect flat We approximately to over

have as between to through to balance We retailers value. diligently driving for opportunity continue reach and shoppers shareholder revenue and will believe expenses continue engage in while we and front a digital us building large CPGs of managing channels. growth We

This and you attending Conferences JMP be San quarter, in will there. forward we Morgan seeing look Investor Francisco the to Stanley and

with We be the RBC. Analysis and First will also on road

call questions. the We will now open Operator? for

Operator

Instructions] [Operator Mark Capital from first from And comes question Mahaney your RBC Markets.

Shweta Khajuria

a its and and year retailers? is improved now driver as specifically for Could learned What How are for next? six This of far, Shweta it Thank launch? Mark. of strategic RPM please focus areas some has partnering Great. key about you your talk the post Thanks. growth what you. so have this with you year

Mir Aamir

is Sure. and we're RPM partners. very – our CPG performance with are happy the so

a interactive RPM ad brand media data to is that and So CPG when data right. retailer lot then and we just mobile technology nutshell, ads, use deliver in a of for are measurement like units

retailers Albertsons the was retailer year-ago talked then we've and first a about. new So like I launch to had

Our sharing good basic And these brands on your importantly brands – been very – is good. our here. enhancements what and we've growth on learning is the campaigns overall that therefore question and for good the is in most very business the repeat very is and and that is ROI with

more take take We have to for branch to the media advantage off. on added the platform technology

influencer we the search. the Ahalogy very, acquired acquisition. success, degree sponsored we technology in And we're adding [indiscernible] and incorporating campaign, part quarter, started of very, that For example, of the as now media great been a social the last for that's

very with that so program So in happy that platform far.

Shweta Khajuria

you. Thank

Operator

next question Jason Oppenheimer. from And comes Helfstein from your

Jason Helfstein

questions. Three thanks. Hey,

talked just around seasonality. some you kind question, about first of modeling and of revenue the So the the

anymore Media change won't Retailer and if overall, way distribution versus iQ going in report, grow the one we revenue operating revenue much the could increase that fee to EBITDA us distribution line outside basically the relate to can question But the time in the we when quarter. expense to to is first you're with goods you from and you backend how and is the advisors the iQ guidance. then the at way think to investors that underperformance guess that see second just so and Just should think of do of about cost the to versus think get first that? quarter, way stock have over but about right obviously And the line? after The help sold, in understand what mean, I just lastly, We And that the how you there's in loaded? of kind revenue? how Retailer relative fee about it question, leverage how given and relates there we versus you equally cadence reasonably consultants in growth, some bringing why is, assess and consider stock or look would healthy shareholder a Board and value? improve the investors Thanks. disconnect I the how obviously

Ronald Fior

at thing percentage X first seasonality. back We're moving last the this year at point look if year, of half into looking we're Okay, on versus year. – the you essentially

percentage we're the at think X XX%. over that's XX%, XX%, XX%, really XX% point, year XX% I last with about So all. change this or looking year. at That's And we're

Mir Aamir

time, half there's – is holiday year. year back this remember but which meaningful the launching there, And seasonality doing revenue the initiatives revenues so in of from the are also media especially the that

timing of So that's the initiatives. those

distribution here for fixed of same you're it it's revenue all the there retailer think and for the apply the Your that relatively But our if and of obviously forward. The forecasting that retailer our be and needed. revenue. can fee fixed revenue actually distribution get on going we the then have can being and to buy that goods to but the fixed to a as piece revenue gets in percentage as goes relatively cost we add similar fee is second of very The touch go goes question a doesn't on do through platforms, does that Ron leveraged of Coupons.com right, cost platforms, of And But percentage leveraged is to continues retailer that you [attack] of media get a that promotions partnership grow That calculated or we’re that essentially media for of when more upon revenue just of does after there fact. to media. distribution – goods. difference fee through revenue platforms. as is and as off-property, other percentage be the is and at

technology goods that about operations, little because we're did few and investments. a it more in our Now prior bit. ad uptick cost Last an fixed adding of we take year, talked calls tech

is So bit But good those revenue as more news gets then little that's that adding going a added quarter. and we've we're leveraged. the this grow that up. But after

Steven Boal

this Steven. is Hi, Yes.

what and listened if growth on little see prepared our a of bit little remarks, business, changing we've businesses carefully a of Your good time. bit return question on is some that more solicit feedback did revenue bit providing the we're versus you'll as disconnect on They're segment more growing verses us reporting is that metrics and a and are rates. [non-transaction of to and well. for focusing over a than a a messaging although or you those reporting non], frustrating we've really the candidly We lot because a quarter some been we a had one, reporting that what shareholder as quite total And is they're given that clarity been receiving the at bit what growth. adding feedback the the engines percentage the on value, confusing actually, and again for people are of

careful from you cash at and expectation and guidance a very messaging accelerates EBITDA, pretty consideration from being XX% revenue the year-on-year, high-end taking two management growth this it's of our range, generated into level, we're there, year both really before, at said, and things, flow the those forward. and it’s As healthy about healthy going which of a accelerated return I think

Jason Helfstein

you. Thank

Steven Boal

Thank you.

Operator

And from Blair. William next Schackart question Ralph our comes from

Ralph Schackart

A afternoon. could. questions, if of Good I couple

and XXXX I remarks, the talked think on prepared about some outlook. the and XXXX new First, growth you drivers guidance having

this color First then digital maybe this, question follow-up. new how and that, about offering. coupon checkout is a you on And talked on a have provide at get can some targeted Any perhaps then could And some as I more quantify chance be? a to this could it? you you color think significant follow-up I

Mir Aamir

Sure.

have On data. checkout, describe the what of digital we customer a lot printed at It to coupons that just targeted which is is, iQ, our has platform. Retailer

We that have targeted run campaigns that digital coupons.

extending every particular been actually point coupons our to the just every and the the to not happened We’re on unique have digital ones at reach in that significantly receipt. this digital programs that time. that single shopper site in to expands right, of see shopper, on bottom Individual the to checkout registered print

as significantly all shopper this every expanding drivers. of the so other And pretty asked to think secondly, in So brands. capability the reach RPM, the targeted about growth coupon store of that you for

growth So driver. RPM significant is another

don't So I'm retailer for I that what ability it is media to significantly very environment Amazon just the search. It’s in from CPGs only even the it standpoint. an powerful. and media more marketplace is contextual very, one that to really with going is has that yet reach Amazon. fully even as a growing includes on Again, proven measurement reiterate in more retailer pretty and mentioned sell customers and is environment data much and in Every display

CPGs. a collectively RPM to light lot that brings account these So for for that of for sales retailers

are So live some we retailers have that go live. and just went more going that to

excited very that So well. driver about as growth we’re

Steven Boal

Hey Steven. It’s Ralph.

single changes generated are just to sale. really the been talked industry walked a a on now. going of And have number store, your coupon going you Well, grocery a every for space a checkout following or into when two right generated that every process. for gets There of a that's there's call. coupons point traditionally while, shopper, you've that as people lane. you targeted Mir during first checkout on lot in this Just back the printed thing of the about, been at Well,

of so you numbers a at of And level are the not. some XX% take if maturity, have like, registered it and just operating store XX% shoppers digital, are

new So a did on to that's Obviously going that's to really volume it's is for multipliers. a shoppers. that. It’s on Albertsons say growth opportunity for able be us. a a Xx opportunity driver Xx And we us. live And reach

time, We're shoppers just focusing now growth for for that about get infer retailers So solution. well. fully first And a that. should integrated there on think across as the you additional

get been they quite the mobile, have in they growing that been in their So all get get e-circulars, things it that they digital, doing strongly. we've it

before, of revenue that other You growing that messaging. XX% XXXX XX% about RiQ our and things Ron and the over opportunity with scale the like same combined This total growing rate. multiplies by of the at four of and at some spoke numbers media reach is heard the

in shopper gets the that now opportunity it's them whether that's or And when can our receipt unique advantage moment time take to digitally. industry. that unique there's right So a And on it's and of quite given out. for messaging, same of kind we printed to a the roll a whether start

Ralph Schackart

and tariffs reasons media. trying square, would in of both to business I historic I a [indiscernible] just as margin those pressure couple set engine of new up for your for well larger the your promotion three all Steven coming maybe pieces your into the Mir. help XXXX private sort follow-up you as solve. cutting of Quotient guess, together and budget two I'm label. of Maybe to to shift platform that, CPGs or think would to seem be A as are growth yet

just customers square spend your your why So are are some seemingly when them. cutting of there to I'm help solutions larger kind trying of to

Mir Aamir

Sure.

Let me on some color that. provide

reductions us that So but that spend board cut spend reduction, not of them Board, that to the the when of and the we expense they across is margins, just approached just of us, cut across that, spend, the perhaps result they – especially we Board. information quarters, across just increase with say And the a have than profit also, have – volume not actually approached the the on three digital, by two as December. they their previous more in year-end volume spend and as them okay. they They needed did well on they helped cut

thing The is this keep is up, on media in Their that us – other media right. it promotions. with the down, not to go actually mind side on spend went did

year, you it offline not keep their if doing overall keep overall time, mind that and just is despite collectively was ROI spend programs And that three. of a and a to Ron decline our take clients, a but shift good. increasing. effect the analysis thing at digital The over ROI marketing overall one right. period CPG on going from packet more these in their that mind to quarters we're cuts, or was a And their keep looking in a everybody, this is multiple we promotions for forward, these of three, in even really that's that reasons effect, these that spend. overall solutions described then in provide that numbers and keep So lastly, And why mind, the promotion

lot made think not cutting that to that – cuts late end really work. very they've came was not a concentrated in quarter. spending. in came the So macro does And a on December they terms the a appears be they decision and at it's It of it it in make decision something towards would in of of

Ralph Schackart

sure one Maybe just understand more I Okay. this. and make

be with XXXX their customers, you to largest XXXX? expect platform total decreasing would relative you your if these increasing spend So look in to on three flat or

Mir Aamir

right. tell So trend, you hard I to the macro predict. But

the I'm So is one, of Ron with mentioned. softness continuing three that these reason that quarter that in some is is softness – like saying

Okay.

fiscal So that's of But prediction. of one they why in them, three, the the little being in cautious have the one terms year-end of larger year, of middle the I'm right. a

packet with is right. the they resets are growing aggressively and experimenting that been then ones with are and overall to that to increase And us. because So the hope from most have spending more able with offline that solutions digital media they they're us, moving

with with with right. in overall proposition data, an value going them to and both also us and overall promotions we're So for marketing spend media

also and that that those value there's And mean in ROI good. package too. programs data again, I the on are So

see any continue don't years them run and in cut long at reason spending to we quarters So multiple time. I look the to if for at a

Steven Boal

Hey, the extract can if with top three, XX% Ralph those you remove just over just XX to – customers, those add us. if grew you of XX

just remember to questions, get we our of other know this. got to kind but annual customers really plans. customers, their with over And spent always and our of I lastly, it’s an So effect we do planning annual

be would their to expect this so case kind a plans we're they're we annual where forecasting over them do. what already of And and

the at they come the would have rate – And so customers that XX%. grown have would come over rest at of quarter the in grew in the at? average XX% of have The over kind year

Ralph Schackart

Okay. Thanks, Steven.

Steven Boal

come XX%. For QX have in over would

Ronald Fior

Maybe Ralph. really clear, in even better, QX come XX% would have over

Operator

question comes Forte And from Davidson. next from your D.A. Tom

Thomas Forte

I everyone same kind else if horse, is apologize ask I'm to a beating sound I the wanted question but So of that asking. dead I like

like to feel own from for come up ways companies retailers we on at packaged into the the with time-ago control Meaning believe companies secular free-standing inserts same seems large digitally, buyer digital. iQ your innovative extent destiny? dependent what you or to integrating market some So the in point on do you you've consumer for these all packaged consumer highly time, you’re like to of shift either you're their sale it But goods Retailer the dependent a marketing system. the large

So be those and as to on what dependent be destiny essentially you able own of you'll innovate, not gives you fluctuations? confidence some your to continue that Thanks. control

Steven Boal

Hey, Tom, Sure. Steven. it’s

the annually growth is One, right. things. two very strong, So

last annually, the guide. other, higher north over of about And on the XX% but accelerated the year we’re quarterly of we're XX%, and at dependent fluctuations here that. one our at the guide so, our We're at talking again, midpoint you're of end or

thing is much vehicles up has always things a commitment. recessionary changes And and decades consumer showing this. way offline lot always to require in it's to that just this a pressure price happened more to because slower been to The planning industry subject second time competitive of and macroeconomic pressures, commodity changes

could industry show to from in you're And every at so here. conclude just I one quarter is we’re like now. that pretty results frequent feels do up why middle an again, significant think which that of that the the basis, and a that's through. control single in fluctuations This seeing that has it it. almost And look the But more on annual offline you of in gone sort last we're of online, shift to probably

Thomas Forte

that, can and influence increase level? follow-up to Coupons.com if quick consumer-facing may a make the marketing any you app your As to what may not at CPG that your or adjustments

Steven Boal

mobile established we've where now. a that assume we established mobiles audience, That's at now anymore to question. have work there an are right things should gotten and really at mobile just say area. in I that don't now I audience good we're hard right, And it's that want you that

Thomas Forte

Okay. Thank very much. you

Steven Boal

Thank you.

Operator

from Your Steven next of question Frankel comes line from Dougherty. the

Steven Frankel

afternoon. Good

had into the I your think you of of hopefully issue all you struggling in minimize business do we're with and the QX. how visibility more kind issues get

a spend visibility? get have media effect and more lock package customers If RPM, of to you of more does offerings, the more because shifting therefore in these that

Mir Aamir

Yes, one effect. described reason lock the does. with reasons, in two it the because We believe is just so, you

is fees coupon The dollars, media second a it's are with all not associated And as dollars, is working reason on the media right. that these our separation viewed right? discount, discount working and between that

into theory be that for obviously media working has off with what to So lot the afforded it playing CPGs and that dollars. a to efficiency do

it, can they these that because and have and a support retailers December promotion more Thirdly, often retail gang that longevity it. support got in behind into retail gives and have tied campaigns merchandising stickiness out us some some

Steven Frankel

media think Okay. Is shift to about on significant And to there we the be start side? weaker going the the XXXX? how a should in promotion business given shifting

Steven Boal

So here, itself margin really I this I question. where towards drives believe. the I that's heading you're is think, gross mean really

that, of on and process happen gross And at that you breakdown – so kind what basis we look is what I say said points, can we in about if that looked would in probably overall the of also for we QX, reasonably would of margin. thought media that's a the also And – to also though expect a of or into a XXXX. you you reduction might what remarks that in gives representative my look if we couple expect I've QX gross think that the we and And versus percentage would happen promotion margin. you the at

Ronald Fior

spend and that, powerhouse that can because Just we're drive package it, of the the of way we And lot promotion a capabilities. making as that as that and looks we're here built using to we to actually Mir through our said, RPM. add that more data, solutions amplifying platform together, we're exacerbating

as And business the together. driving and through packaging a of becoming That's see decline we're the the naturally would over by so more our distinction relevant. lot transaction and side is media number between two that more dollars RPM them at or of the you time less data hands the why a would

Steven Frankel

by expect you RPM would live And year? this have the six customers all to end of

Mir Aamir

Yes.

Ronald Fior

Can you up, that tighten Mir?

Mir Aamir

live six, the half year, middle by year, of of Four six the of of the Two probably the the back okay. okay.

Ronald Fior

you. Thank

Mir Aamir

some give of you timing. So that sense

Steven Frankel

Great. Thank you.

Operator

line from of America comes question Schindler Merrill of your Nat And next the Lynch. from Bank

Nathaniel Schindler

I understanding wanted just to guidance. you're Yes. XXXX guys. Hi,

promotions the in that the the which at expecting core non-core you're business iQ grew XX%. Retailer that a said shrinking XX%, XXXX your You as at Obviously percentage businesses total. in same grew amount XXXX midpoint, you in are of

in So expect be think from XXXX. that But businesses see how in core will same, XXXX? would much in the growth you I these you wouldn't do

Ronald Fior

was XX% growth I that the businesses, and last Well grew that, trailing if just growth take look at RiQ without being specific, of at the you of wrong. percentages quarter media

Nathaniel Schindler

around same. was the It

Ronald Fior

It’s around right, same, the around XX%.

the had So some straight spending best the of is back were always up. softness we lines, where obviously. promotion lines just predictor not which end saying numbers earlier, you growth more CPGs the same. the straight this of History in goes should if future. you draw the the Nat impacted to expect when We But

that's between as really go disconnect before soliciting still a we're were the size, we clear, got And the it's asked we're not so the I the the so transactions, – some to growth segments we're rate, but obviously be base the on confusion you the got if where investors was asked expectation healthy they're business that two relevant would things and feedback to management because midpoint, success KPIs measured. that people other the between balance some I of is question forward that and loud thing two the trying XX% trying saying consider at on and business a a basis. the that's and and a or reporting consternation. the but some and the growth of causing it, heard shareholder before this and strong And where asked clear I forgot the question and And at why midpoint on we who confusing and is

Nathaniel Schindler

Okay, great. Thank you.

Mir Aamir

you. Thank

Operator

And back there the to this further turn call I'll over management. no time. questions are at

Mir Aamir

Thank for you today. all joining us

XX% XXXX revenue way with strong of then XX% had dollar summary, growth a a marketing growth, growth, by solid XX% Again, media in innovation and we revenue EBITDA in Just platform. checkout. of platforms Thank growth including very including our and targeted in you audiences XXXX, four search printed coupons, about cloud we're at promotions drivers are sponsored excited many and and Quotient again. RPM,

Operator

Thank for today's This joining. call. you does conclude

You disconnect. may now