Q3 2024 VTEX Earnings Call

Thomson Reuters StreetEvents11-07

Participants Juila Fernandez; Investor Relations Director; VTEX Geraldo Do Carmo Thomaz; Co-Chairman of the Board, Co-Chief Executive Officer; VTEX Ricardo Sodré; Chief Financial Officer; VTEX Mariano...

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Thank you, Julia. Welcome everyone, and thank you for joining our third quarter 2024 earnings conference call. We are proud to report that our product innovation and expanded platform capabilities continue to be key drivers of growth, further strengthening our competitive moat. Through our complete and composable approach, we are deepening relationships with existing customers while also attracting high-profile brands and retailers, driving both top-line growth and profitability. VTEX made strong strides toward profitable growth. During a period of macro uncertainty, we continued delivering strong subscription revenue growth while also optimizing our cost basis, resulting in a gross profit growth of 28% in FX neutral this quarter. Significant progress is also noticeable on a Rule of 40 basis, with VTEX achieving 32% this q","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"VTEX":"VTEX"},"translate_title":"2024年第三季度VTEX收益看涨期权","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"VTEX":1},"content_text":"Participants\nJuila Fernandez; Investor Relations Director; VTEX\nGeraldo Do Carmo Thomaz; Co-Chairman of the Board, Co-Chief Executive Officer; VTEX\nRicardo Sodré; Chief Financial Officer; VTEX\nMariano Gomide de Faria; Co-Chairman of the Board, Co-Chief Executive Officer; VTEX\nMarcelo Santos; Analyst; J.P. Morgan Securities LLC\nCesar Medina; Analyst; Morgan Stanley\nLeonardo Olmos; Analyst; UBS Casa de Bolsa, S.A. de C.V.\nPresentation\nJuila Fernandez\n Hello everyone, and welcome to the VTEX earnings conference Call for the quarter ended september 30th, 2024. I am Julia Vater Fernández, VP of Investor Relations for VTEX. Our senior executives presenting today are Geraldo Thomaz Jr, Founder and Co-CEO, and Ricardo Camatta Sodre, Chief Financial Officer. Additionally, Mariano Gomide de Faria, Founder and Co-CEO, and Andre Spolidoro, Chief Strategy Officer, will be available during today's Q&A session. I would like to remind you that management may make forward-looking statements relating to such matters as continued growth prospects for the company, industry trends and product and technology initiatives. These statements are based on currently available information and our current assumptions, expectations and projections for future events. While we believe that our assumptions, expectations and projections are reasonable in view of the currently available information, you are cautioned not to place undue reliance on these forward-looking statements. Certain risks and uncertainties are described under Risk Factors and Forward-Looking Statements sections of VTEX's Form 20-F for the year ended December 31st, 2023 and other VTEX's filings within the US Securities and Exchange Commission, which are available on our investor relations website. Finally, I would like to remind you that during the course of this conference call, we may discuss some non-GAAP measures. A reconciliation of those measures to the nearest comparable GAAP measures can be found in our third-quarter 2024 earnings press release available on our investor relations website. Now, let me turn the call over to Geraldo. Geraldo, the floor is yours.\nGeraldo Do Carmo Thomaz\n Thank you, Julia. Welcome everyone, and thank you for joining our third quarter 2024 earnings conference call. We are proud to report that our product innovation and expanded platform capabilities continue to be key drivers of growth, further strengthening our competitive moat. Through our complete and composable approach, we are deepening relationships with existing customers while also attracting high-profile brands and retailers, driving both top-line growth and profitability. VTEX made strong strides toward profitable growth. During a period of macro uncertainty, we continued delivering strong subscription revenue growth while also optimizing our cost basis, resulting in a gross profit growth of 28% in FX neutral this quarter. Significant progress is also noticeable on a Rule of 40 basis, with VTEX achieving 32% this quarter, up from 28% in the same period last year. We may be slightly more than a handful of quarters away from reaching the 40% target presented on our Investor Day last year. Finally, as macro uncertainty may begin to clear, we have streamlined VTEX to fully capitalize on the attractive market opportunities ahead. We are proud to serve some of the most influential brands and retailers, fostering trusted relationships and supporting their success, which ultimately pushes us toward our vision to become the backbone for connected commerce. On top of our existing customer's robust performance, adding new customers further strengthens our growth engine. New contract signatures have remained robust. This quarter, we are excited to highlight the successful go-live of Fast Shop in Brazil, one of the big accounts we were implementing throughout the year. This solid sales momentum in our most mature market, compounded by the progress in the US and Europe, and newer products such as our B2B offering and VTEX Ad Network, gives us confidence in our long-term profitable growth potential. On Q3, 2024, beyond Fast Shop's go-live in Brazil, we've expanded our customer base with new wins, including: Beko in Austria, Bemol, Champion Relógios, Ferramentas Negrão, FQM Consumo, GrêmioMania, and Jorge Bischoff in Brazil; Comfama and Rimax in Colombia; Cálidda and Farmacia Universal in Peru; and US Electrical Services in the US. Our existing customers are also deepening their partnership with VTEX. Colgate launched a new store in Switzerland, expanding its footprint across Switzerland, Brazil, and the US. Hearst added two new stores, Harper's Bazaar and Prevention, bringing their store count to five across the US. Keune Hair cosmetics launched a new store in the UK. Now serving the UK, Belgium, France, and the Netherlands. Mazda expanded into Belgium, now operating in three countries across Europe. And Samsung added two new stores in Uruguay, now operating in three countries in Latin America. We are grateful for the trust of our customers, whom we look forward to serving with excellence. Their decision to entrust VTEX reflects the value of our product, and the deep relationships we forge as we collaboratively shape the future of ecommerce. And talking about collaboratively shaping the future of commerce, this year we hosted several key events to strengthen our brand presence across various geographies, including the US, Brazil, and Barcelona. This quarter was the turn of a high-potential market for us, Mexico. VTEX Connect Latam 2024, which has become a flagship event for digital commerce in the region with over 10,000 registered participants in Mexico City. The event featured prominent players such as Amazon, Decathlon, Grupo Coppel, HEB, L'Oréal, Mondelez, TikTok, and many others, with Apple Co-Founder Steve Wozniak headlining as the keynote speaker. Like our other events this year, VTEX Connect Latam was instrumental in boosting brand awareness, and recognition, driving lead generation and potential future conversion in our sales funnel. This quarter, we have also launched the VTEX Vision Fall edition, an initiative designed to align our product roadmap with customer needs and showcase the robustness of our platform to prospects. Reinforcing our position as the leading composable and complete commerce platform, let's highlight some key announcements. On the retail media side, in this edition, we expanded the VTEX Ad Network media kit portfolio with new ad formats. Sponsored products now appear in search auto-complete suggestions and product galleries, boosting visibility and customer engagement with a seamless experience. We've also simplified the process for advertisers to measure and visualize campaign performance, offering deeper insights and facilitating data driven decisions. Advertisers can now easily export campaign data, search terms, and product insights, providing comprehensive reports with just a few clicks. Additionally, we announced upcoming features, such as ads with product recommendations powered by Synerize and sponsored banners, targeting shoppers at the discovery phase. The VTEX Ad Network already counts with leading publishers such as Fast Shop, Drogaria Pacheco São Paulo, and Zona Sul, among others. We've also introduced new data models for catalog, promotion, and external marketplace data to the VTEX Data Pipeline. The product is now compatible with any preferred data warehouse, BI tools, and CRM systems, making it easier than ever to deliver VTEX commerce data where it's needed most. These new models offer a unified view of commerce operations, allowing businesses to optimize their strategies seamlessly. These are just a few of the exciting updates in the VTEX Vision Fall edition. I encourage everyone to visit our website at vision.vtex.com, for the complete list of the releases, enhancements, and product innovations. In the third quarter of 2024 we also expanded our platform's post-purchase capabilities with the acquisition of Weni, a leader in AI-powered customer service solutions. Although a small financial investment, this strategic acquisition significantly enhances VTEX's ability to offer a comprehensive, end-to-end customer experience platform tailored to the personalized needs of today's consumers. VTEX customers will now benefit from AI-driven, intuitive customer support options that boost efficiency and drive sustainable business success through a more connected and seamless commerce journey. Weni's AI capabilities allow us to deliver more than software. Through AI, we will deliver measurable business outcomes of increased customer engagement and satisfaction while optimizing outdated and inefficient call center operations. Finally, this acquisition aligns perfectly with our vision to be the backbone for connected commerce, shaping the future of digital commerce by empowering brands and retailers to deliver personalized, omni-channel experiences at every touch point. Now, turning to the heart of our company, our customers, I'd like to share some success stories. Bemol, one of Brazil's largest retailers with 39 stores, 48 pharmacies, and five distribution centers, successfully migrated its entire operation to VTEX, including its B2C franchise model and headless app, seeking a scalable, efficient platform to unify operations, streamline sales, and introduce innovative financial solutions like Bemol Store Credit, Bemol Vale Bonus, Crédi to Bemol, and Bemol PIX. During the phased rollout, the website already experienced a 12% boost in conversion rates and a 33% increase in average revenue per session. After fully migrating all traffic to VTEX, organic traffic rose by 8%, supported by a 56% faster loading performance in mobile devices with limited processing power and internet connectivity. These advancements not only improved the user experience, but also reinforced Bemol's expansion across Brazil. With VTEX, Bemol is now positioned for further growth, capitalizing on scalable architecture and strong financial integrations to provide a superior omni-channel experience. Colgate-Palmolive, the global leader in oral, skin and pet care, continues its expansion with VTEX. Following the successful B2B implementations of PCA Skin Professional and Colgate Oral Professional in the US, Colgate has now extended its digital strategy to international markets, recently launching Oral Professional in Switzerland, and its European B2B site on VTEX. Colgate's headless global architecture powered by VTEX enabled a seamless rollout, demonstrating the platform's adaptability and scalability across diverse markets and business models. We are thrilled to support Colgate's continued expansion in the US and Europe, underscoring their commitment to digital commerce innovation. Decathlon, a global leader in sporting goods retail with over 1,700 stores across 64 countries, leveraged VTEX's Sales App in Brazil to enhance its omni-channel strategy and create a seamless shopping experience across both physical and digital stores. By integrating their sales channels, Decathlon allows customers to purchase items not in local stock by accessing a unified inventory across all stores. The VTEX Sales App enabled personalized customer interactions, real-time stock visibility, and flexible checkout, ensuring a faster, more agile shopping experience. This innovation has helped Decathlon maintain its commitment to delivering high-quality, customer-centric service, driving operational efficiency and increasing conversion rates through a fully unified commerce platform. Fast Shop, the leading Brazilian retailer with 36 years of history, 85 stores, and 15 distribution centers, selected VTEX to migrate from its legacy platform due to high costs and lack of flexibility. Fast Shop has now significantly lowered its total cost of ownership and gained access to our robust and deep ecosystem of third-party solutions, enhancing its customer experience and rapidly expanding into new channels like B2B. All operations, including physical stores, online storefronts, marketplace, and B2B, will now be integrated into a single unified platform. They've also developed a custom app for in-store sales teams, delivering personalized shopping experiences. This strategic shift strengthens Fast Shop's premium customer journey, offering a seamless omni-channel experience with exclusive services and a strong loyalty program, Fast Prime. We are thrilled to see immediate improvements in site performance and sales conversions and look forward to supporting them with agility and flexibility in all future developments. Hearst, one of the largest global diversified information and media companies, has leveraged VTEX's extensive native capabilities, multi-site architecture, and VTEX IO developer cloud to successfully integrate with the prestige beauty retailer, Sephora, becoming part of Hearst's expanding digital marketplace. Now available across leading lifestyle publications like Women's Health, Cosmopolitan, Harper's Bazaar, Men's Health, and Prevention, Hearst's integration with Sephora marks a new era transforming the buying experience for consumer media businesses. Readers can now seamlessly purchase products that are mentioned or featured in published content from their favorite national magazine and websites, making every touch point a sales opportunity. Women's Health, a trusted publication contributing to the well-being of women everywhere, has expanded its reach by instantly enabling readers to become customers. Now, with just a click, over 8,500 products with Sephora's diverse assortment are available, offering customization and rewards through its popular Beauty Insider loyalty program. We are excited to accompany Hearst in this journey that marks a major advancement for the media industry, delivering a seamless experience with shoppable interfaces for effortless product discovery and purchase. Closing this section, I would like to extend my sincere gratitude to the 1,409 VTEXers. It takes a collective effort, and together we are reshaping the future by establishing VTEX as the backbone for connected commerce. We have ambitious goals and unite we will seize every opportunity. I will now hand the call over to Ricardo.\nRicardo Sodré\n Thank you, Geraldo. Hi everyone, I am pleased to share VTEX's Q3, 2024 financial results. This quarter our GMV reached $4.4 billion, marking a year-over-year growth of 10% in US dollars and 17% in FX neutral. With same-store sales remaining in the teens range. Our revenue stood at $56.0 million, representing a year-over-year increase of 11% in US dollars and 19% on an FX neutral basis. Subscription revenue reached $53.9 million, representing an increase of 13% in US dollars and 22% in FX neutral, primarily driven by good momentum in new contract signatures, solid performance from existing customers, and cross-selling of add-on services. Services revenue totaled $2.1 million, a by-design reduction given that the evolution of our ecosystem has allowed our new customers in the US and Europe to rely less on direct services from VTEX, which in many cases were sold at a loss to onboard our initial larger customers in these regions. Now, going to our costs and expenses: our non-GAAP gross margin reached 75%, up from 71% in the same quarter last year. The approximately 410 basis points year-over-year improvement was mainly driven by hosting cost efficiencies, resulting in our non-GAAP subscription gross margin increasing 230 basis points, reaching 79% in Q3, 2024 from 76% in the same quarter last year. While work remains to fully reach our Investor Day subscription gross margin target model goal, future improvements may be more marginal. Moving down the P&L, this quarter we achieved a positive 14% non-GAAP operating income margin, marking a 10 percentage-point improvement year-over-year. Our non-GAAP total operating expenses were $34.2 million, slightly up from $34.1 million in the same quarter last year. As mentioned earlier, most of this margin expansion is driven by revenue growth, supported by a well-invested and efficient organizational structure, which will allow us to invest in R&D and sales and marketing to fully capitalize on market opportunities as they emerge. Combining our operating income result with disciplined working capital management resulted in our free cash flow in Q3, 2024 reaching $7.7 million, representing a 14% margin and up from 5% margin in the same quarter last year. We are well-positioned to continue delivering strong cash conversion and will remain focused on pursuing the most suitable, high-return opportunities for the long term. Notably, given our strong free cash flow, we managed to increase our cash and short-term investment position to $217 million even after allocating capital in some inorganic opportunities. Looking ahead, we remain encouraged by our sales momentum and operational leverage. As macro uncertainty may begin to clear, we have streamlined VTEX to fully capitalize on current market opportunities. We reaffirm our commitment to delivering profitable growth by continuously focusing on maximizing revenue and long-term value. We will continue to evaluate our investment levels in alignment with demand, sales conversion rates, and return on investment, with the Rule of 40 as our north star. Moving on to guidance. From a revenue perspective, given tougher comps in Q4 that will ease up in Q1, we are targeting FX neutral year-over-year revenue growth of 14% to 17% for the fourth quarter of 2024, implying a $64.8 million to $66.8 million range. For the full year 2024, as we continue executing our profitable growth strategy, we are targeting FX neutral year-over-year revenue growth of 18.5% to 19.5%, implying a range of $230 million to $232 million based on Q3's average FX rate. We are raising our non-GAAP operating income and free cash flow margins target to low teens. In conclusion, VTEX holds significant growth potential, supported by our progress toward profitable growth. We're seeing strong sales momentum with new customers, geographical and brand expansion from existing customers, and improved operational efficiency, positioning us to seize future opportunities. We remain optimistic about Brazil's potential, the vast opportunities in Latin America, and the large and attractive markets in the US and Europe. We will continue pursuing disciplined growth, making firm steps toward our ambition to become the global backbone for connected commerce. With that, let's open it up for questions now. Thank you.\nQuestion and Answer Session\nOperator\n Thank you. We will now begin the question-and-answer session. (Operator Instructions) Marcelo Santos, JP Morgan.\nMarcelo Santos\n Hi, good evening. Thanks for taking my questions. The first question is, if you could provide some additional color on the growth of subscription revenues, how is that going per region? You had some tougher situation in Argentina, so I just wanted to -- if you could focus a bit there, but also talk about the other regions. And the second question is, do you see this margin level as sustainable and are you happy with the growth margin combo? How would you consider that? Thank you.\nRicardo Sodré\n Hi, Marcelo. Ricardo here. Thanks for your question. So, in Q3 we achieved a total revenue growth of 18.7% in FX Neutral. That's close to the midpoint of the guidance range of 18% to 20% that we provided last quarter. And that's also a two-year CAGR in FX Neutral of 22% for total revenue, and on your question, 23% for subscription revenue. It's important to note these two-year CAGR, given that last year we were positively impacted by an acceleration of consumption in Argentina from August until November and as mentioned in last year's earnings call. And I would also add that from organic revenue growth, it was very similar to the total revenue growth, as the Weni acquisition contributed only a negligible amount to our revenue and did it solely in the last month of the quarter. So, continuing on your question, the subscription revenue. We delivered a robust year-over-year growth of 22% in FX Neutral. Even against these challenging comps in Argentina, where last year's pre-devaluation consumption behavior affected the baseline. And as mentioned last quarter, Argentina remained a couple percentage points headwind to our growth this quarter. And as noted in the Q4 outlook, we expect this headwind to reduce by December when Argentina FX devaluation happened last year and consumption started adjusting. And our ex-Argentina performance underscores the strong underlying performance of the company on a more recurring basis. And I would also add that as we rely more on the VTEX ecosystem of partners, we experience a by-design reduction in our services offering. This decision negatively impacts our services revenue and positively impacts our gross margin and bottom line, as in many instances these services were sold at a loss. So, the strategic by-design decision to increase our services offering last year was a consequence of the first couple bigger implementations we were doing in the U.S. and Europe. And now, as the ecosystem matures and already did larger implementations, we are confident to lower the services offering, minimizing the impact on our margins. So, looking ahead, as we lap the tough comps, the strong performance of existing stores and our robust sales momentum are fundamental factors that instil confidence in our ability to deliver solid, profitable growth. So, I believe that answers the first question. Marcelo, could you please repeat the second question?\nMarcelo Santos\n The second question is about the sustainability of margins and if you are happy with the growth margin combo.\nRicardo Sodré\n Yeah, perfect. I am happy to start on this one and others feel free to compliment. So, the margin is sustainable, yes. We have a target model of 80% for the subscription gross margin. We are making progress toward that. We are at 78.5% in this quarter. So we still have 1.5 percentage-points to get there. From the overall gross margin, we are at 74% and change and the target is 75%. So, we are moving towards that level. And then, when we look at the operating margin, we reached 14% this quarter, while our goal is 20%. So, these incremental margins will come as we scale and drive revenue leverage over time. So, we are a high growth company, and we continue to prioritize this revenue growth and we are committed to profitable growth with additional well-aligned hires in R&D and sales marketing as we see fit. So, as this momentum continues, we will certainly update you all on the progress. But we feel like we have a well-invested structure at the moment and we will continue to improve on margins going forward.\nOperator\n Cesar Medina, Morgan Stanley.\nCesar Medina\n Hi, thanks for taking my call. A quick question. Can you provide more context on what you highlighted as a strong new contract signature momentum? I'm asking this, because it seems as if bookings that you reported in the quarter accelerated. So, it would be great to have some color in terms of what's going on, where is this coming from, what type of sectors, and more importantly, the mix of regions where you are getting this acceleration. Thank you.\nMariano Gomide de Faria\n So, I can take this one and, Sodre, if you please join adding anything. So thanks for the question. Mariano here. As mentioned in our prepared remarks, our global pipeline shows steady improvement, followed by our unique composable and complete commerce platform. We deliver very low TCO compared to our competitors, pretty fast time to market, and very flexible solution for testing multiple go-to-market strategies. Our technical sales model, successfully customer case studies and recognition from IDC, from Forrester, and from Gartner, all contribute to this momentum that you might see. So, in today's challenging retail landscape with high interest rate, VTEX popped as the partner for the sustainable growth and profitable growth. So, in Brazil, to be more narrow on the analysis, we see strong B2C growth potential as more players are now open to migrate to VTEX, moving away from the legacy platforms or homegrown. In that sense, this quarter we had two lives that is an evidence of this movement, like Fast Shop and Bemol. Big retailers based on homegrown and custom legacy migrating for VTEX. And these are only an example of a couple of the clients under implementation. But as you know, we just comment the clients that goes live. On the B2B side, also grows as the company modernized their front-end and channels approach, which gave us a huge opportunity to keep growing and redefining the commerce landscape in Brazil and Latin America. In the United States and Europe, our portfolio is expanding across categories, omnichannel marketplace customers, including Hearst in the U.S. and OBI in Europe. We also have H Mart in the U.S., Auchan in Europe. And this quarter, we can celebrate go-lives from Colgate-Palmolive and Keune, both in B2B models across the U.S. and Europe. Colgate now operates both B2C and B2B in the U.S., while Keune is live in four European countries, so further expanding their retail footprint with VTEX. So these milestones, coupled with industry recognition have significantly strengthened our brand presence and our pipeline. We are confident in our path forward, building on execution, reputation, and customer success histories to capture the market opportunity that's ahead of us.\nRicardo Sodré\n And just to further complement from a financial perspective, Cesar, the increase in deferred revenue is consistent with the strong contract signature momentum mentioned in the prepared remarks and by Mariano just now. And now having said that, it's important to note that there was also some increase in the deferred revenue duration. Therefore, adjusting by average duration, the increase in deferred revenue was a bit more modest than what is presented in our balance sheet, without any duration adjustment, but still a pretty solid improvement.\nOperator\n Leonardo Olmos, UBS.\nLeonardo Olmos\n Hi, everyone. Just one question from my side. Can you talk a little bit about system integrators? Can you talk about your current relationship with them? How has it been evolving? What types of strategy are you thinking about for 2025? And if you have one or more competitors, they are growing relevance in terms of those distributions in system integrators. Thank you.\nMariano Gomide de Faria\n Yep. So, VTEX ecosystem matures. We are seeing, as you can see on our numbers and the service revenue of VTEX, it's not increasing as the revenue. That's a sign that our ecosystem of SIs are maturing in all regions. So, VTEX's needs to provide direct service has declined. So, system integrators in new geos now bring stronger experience in executing implementation projects on our platform. And therefore, since the Q1, you can notice that we gradually reduce our direct roles in our implementations resulting in a lower contribution from service revenue and higher margins and you can expect that as our target company. We believe the SI, it is pretty complete and can be a strength or leverage for us to deploy projects all over the world. Our focus remains on subscription revenue, the core of our product-driven business model, and a key driver of profitability. Leveraging a mature ecosystem of system integrators enables us to have this global reach, global support, and a profitable growth. Notably, 96% of our revenue are subscription-based, while service contributes 4% only. So, subscription revenue is the true indicator of the business health, and in Q3, it grew 22% FX-neutral, paired with our increasing gross profit, which rose 28% in FX-neutral this quarter. Did I answer your question?\nLeonardo Olmos\n Yes, yes, and great news. Just a small part of my question, if you could maybe double-click on it. The competitor spark that I asked? Is there any competitor that is advancing with SIs or any other form? Thank you.\nMariano Gomide de Faria\n So competition, the competitive environment has remained stable. While we always receive questions about peers potentially expanding from long-tail or SMB segments, or some enterprise competitors displaying increased aggressiveness in one region or another region, we haven't observed any significant shifts. Our overall annual revenue churn remains consistent in the mid-single-digit range, and we continue to gain market share globally. Nevertheless, we are monitoring the competitive environment, ensuring our value prop and technology stack to remain highly competitive. But just summarizing, we didn't see any kind of major shift in the competitive landscape.\nLeonardo Olmos\n Great. All right, a lot of great news. Thank you very much. Have a good night.\nOperator\n (Operator Instructions) And there are no further questions. So this does conclude our question-and-answer session. I will now turn the call over to Geraldo Thomaz, founder and Co-CEO of VTEX for closing remarks.\nGeraldo Do Carmo Thomaz\n In conclusion, I would like to reaffirm our commitment to delivering profitable growth and our objective of returning to the Rule of 40. This quarter's progress reflects the dedication of our team at VTEX. Once we set our goals, we work relentlessly to achieve them, no matter the scale of our ambitions. With over 20 years of history, we can confidently say that VTEX grows stronger each year, and this year is no exception. We are honored to support some of the world's leading brands and retailers as we define commerce together. Bridging the gap between physical and digital channels, and strengthening an industry with immense potential ahead. Our purpose is to keep our customers ahead of the curve, adaptable, and resilient in the face of constant change. With strong sales momentum and continued platform innovation, VTEX is well positioned for sustained growth and to solidify its role as an e-commerce leader on a global basis. We have a long, invigorating journey ahead of us, and we are here to seize it as we remain fully committed to delivering value to our customers, investors and stakeholders, and as we continue our journey to becoming the backbone for connected commerce. Thank you, everyone, for being part of this journey. We look forward to keeping you updated at our next earnings call. You may disconnect now. Have a wonderful week.\nOperator\n This concludes today's conference call. Thank you for your participation. You may now disconnect.\nGeraldo Do Carmo Thomaz\n Disconnect now. 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