Hello everyone. Thank you for joining us and welcome to Yelp Incorporated's third quarter 2026 earnings conference call. A reminder that participants are in a listen-only mode. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Kate Krieger, Director of Investor Relations. Kate, please go ahead.

Good afternoon and thanks for joining us on Yelp's third quarter 2026 earnings conference call. Joining me today are Yelp's Chief Executive Officer Jeremy Stoppelman, Chief Financial Officer David Schwarzbach, and Chief Operating Officer Jed Nachman. We published a shareholder letter on our investor relations website and with the SEC and hope everyone had a chance to read it. We'll provide some brief opening comments and then turn to your questions. Now I'll read our safe harbor statement. We'll make certain statements today that are forward-looking and involve a number of risks Thank you. Thank you. In addition, we are subject to a number of risks that may significantly impact our business and financial results. Please refer to our SEC filings as well as our shareholder letter for a more detailed description of the risk factors that may affect our results. During our call today, we may discuss adjusted EBITDA, adjusted EBITDA margin, and free cash flow, which are non-GAAP financial measures. These measures should not be considered in isolation from or as a substitute for financial information prepared in accordance with generally accepted accounting principles. In our shareholder letter released this afternoon in our filings with the SEC, each of which is posted on our investor relations website, you will find additional disclosures regarding these non-GAAP financial measures as well as a historical reconciliation of GAAP net income or loss to adjusted EBITDA, a calculation of net income margin and adjusted EBITDA margin, and a historical reconciliation of GAAP cash flows from operating activities to free cash flow. And with that, I will turn the call over to Jeremy.

Thanks, Kate, and welcome, everyone. Yelp continued to advance its AI transformation in the third quarter. Our team made local discovery more conversational, delivered new tools to help businesses succeed and expanded the reach of our trusted content through new partnerships. Together, these efforts resulted in the recent rollout of more than 30 new features and updates, along with substantial advances in our AI voice offerings. At the same time, consumers and local businesses continue to face a challenging economic environment, contributing to increased pressure on advertising revenue. Thank you for joining us. Moving to our product initiatives, we have reconceived how consumers and businesses connect on Yelp through Yelp Assistant, a conversational experience that provides answers and enables actions. In the third quarter, we made Yelp Assistant more personalized and expanded the actions consumers can take with it. Yelp Assistant continued to be an important driver of project submissions in the quarter, generating approximately 10% of request to quote projects and contributing to overall project growth of approximately 10% year over year. More recently, we added keep me posted reminders integrated with OpenTable and rolled out a check for me agent, which can check restaurant wait times for consumers. In services categories, we enhanced booking functionality by integrating the scheduling and booking tools pros already rely on. Looking ahead, Yelp Assistant will soon leverage users chat and search history to deliver more personalized answers and recommendations across categories. We are also delivering AI tools that help service pros and other local businesses grow, operate, and succeed. Yelp Host, our internally developed AI-powered call answering service for restaurants, continued to scale, reaching an annual run rate of 2.5 million calls handled in October, up 15x since October of 2025. Yelp Host was among the first voice solutions to deploy GPT Live, which supports more natural, fluid conversations. In testing with a major restaurant client, food order conversion increased by 13% since its implementation in September. We believe Yelp Host is a best-in-class product based on customer feedback, and we are expanding our go-to-market team to capture the significant opportunity ahead. We are making similar product and go-to-market investments in Hatch. We substantially improved Hatch's voice AI and deepened the integration with Service Titan. These efforts contributed to continued business momentum. Hatch's annual run rate revenue reached approximately $37 million in the third quarter, up 55% year-over-year and 6% quarter-over-quarter. Looking ahead, we are expanding the platform to serve additional services categories while enhancing our suite of products. Beyond AI tools for businesses, Yelp's trusted content is increasingly powering local discovery across the broader AI ecosystem. In the third quarter, we saw robust demand for our data licensing products, including from our partnerships with OpenAI and Meta. More broadly, personal AI agents have gained considerable momentum in recent months. As these agents increasingly act on consumers' behalf, we believe Yelp's trusted local content makes us an essential partner for connecting consumers with local businesses. In summary, we made significant progress in transforming Yelp with AI in the third quarter. While the macro environment remains challenging, we're confident in our plans and believe that our initiatives will position us to drive shareholder value over the long term. With that, I'll turn it over to David.

Thanks, Jeremy. Turning to our third quarter results, net revenue decreased by 1% year over year to $371 million, $1 million above the high end of our outlook range. year-over-year to $35 million, or 63 cents per share on a diluted basis, representing a 9% margin. Adjusted EBITDA decreased by 6% year-over-year to $92 million, $17 million above the high end of our outlook range, representing a 25% margin. As Jeremy mentioned, consumers and local businesses continue to face a challenging operating environment. Services ad revenue decreased by 2% year-over-year to $238 million, while RRO ad revenue decreased by 13% year-over-year to $99 million. A decrease in services locations was partially offset by a 3% increase in RRO locations, largely driven by multi-location advertisers. This resulted in an overall decline of 1% year-over-year in paying advertising locations to 509,000. Ad clicks declined by 8%, and average CPC increased by 2% year-over-year in the quarter, in each case primarily due to softer consumer demand. Moving to other revenue, other revenue increased by 82% year-over-year to a record $34 million. This strong growth was driven by the inclusion of revenue generated by Hatch, as well as significant growth in revenue from data licensing and food ordering. Turning to expenses, In 2026, we are maintaining a disciplined approach and shifting resources toward high return areas that we believe will transform Yelp. In particular, we see a large opportunity in other revenue through AI-driven offerings such as Yelp Host, Hatch, and data licensing. As these revenue streams continue to gain traction, we are targeting an annual run rate of $250 million of other revenue by the end of 2028. At the same time, we see substantial opportunities to unlock operational efficiencies and increase employee productivity with AI. We've already seen AI tools drive meaningful improvements in product and engineering velocity, and we are bringing new products like Yelp Host to market faster than ever before. We reduce stock-based compensation expense as a percentage of revenue by three percentage points year-over-year To create long-term shareholder value, we have evolved our approach to capital allocation. We plan to invest in future growth, pursue strategic acquisitions through a combination of cash and financing, and return more than 50% of free cash flow to shareholders each year through share repurchases. As previously disclosed, in the third quarter, we repurchased $25 million worth of shares at an average price of $26.14 per share, bringing our total repurchases for the year to $200 million and contributing to a 15% year-over-year reduction in diluted shares outstanding. We subsequently paused our program to pay down our revolving credit facility. With $339 million remaining under our authorization as of September 30th, We expect to resume repurchases in 2027 subject to market and economic conditions as well as business requirements. Turning to our outlook, we anticipate that the challenging economic environment for consumers and local businesses will persist in the fourth quarter with increased pressure on advertising revenue across categories. At the same time, we expect our investments and our strategic initiatives will continue to drive strong growth and other revenue. As a result, we expect fourth quarter net revenue will be in the range of $347 million to $352 million. For the full year, we are updating our range and now expect net revenue will be between $1.455 billion and $1.46 billion. Turning to margin, following strong expense favorability in the third quarter, we expect expenses will be modestly higher in the fourth quarter as we focus our investments in key areas, including Hatch and Yale Post. As a result, we expect fourth quarter adjusted EBITDA will be in the range of $57 million to $62 million. For the full year, we are narrowing our range to the high end and now expect adjusted EBITDA will be between $320 million and $325 million. In addition, we expect to recognize a tax benefit of approximately $30 million in the fourth quarter related to previously unrecognized tax benefits, including related interest, which will benefit net income but will not impact adjusted EBITDA. In closing, Yelp's third quarter results reflect growing traction across our AI-driven offerings. We continue to believe in the opportunities ahead and our ability to deliver long-term shareholder value. With that, operator, please open up the line for questions.

Thank you. We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Alex Valiante with Goldman Sachs. Alex, your line is open. Please go ahead.

Hey guys, thanks for taking the question. I wanted to dig into the other revenue opportunity a little bit more and specifically in the context of some of the consumer AI agents that have launched recently, such as Muse and things like that. How might you see Yelp playing a role in that landscape if we see consumer adoption of some of these tools increase? And given your existing data licensing partnerships with both OpenAI and Meta, how might the monetization structure look like in that world going forward? Thanks.

Hey, Alex. This is Jeremy.

Thanks for the question there. Yeah, we're really happy with other revenue growing 82%. year over year. We've had a lot of success now for about a year with various LLM search players. That whole space, the quality conversations continues to be strong. The quality of deals that we've done has been strong. and I think that carries forward into the personal assistant realm. There's obviously Meta and we have talked historically about, I think it was last quarter, our deal with Meta AI and so that really gives access to Meta all of our data across all of their properties, including Muse. and from their engagement and what we're seeing, they're really leaning into it. And I think if you step back and look at the personal agent space, you know you really need high quality local information you need to know the reputation all the subjective information that we have in terms of reviews you obviously want photos to be able to showcase to users and you really need accurate listing information you know whether the business is in fact still in business as well as the hours is absolutely critical you can imagine you know somebody's coming up with the anniversary idea and get sent to a restaurant that's no longer in business or you're outside the hours that it's open, that's going to be a real deal breaker for that user. It can result in obviously bad feelings and potentially bad press and all that. So I think for anyone building in a personal agent space, they're going to want to look at Yelp unless their name is Google.

Thank you.

Your next question comes from the line of Robert Coolbreath with Evercore ISI. Robert, your line is open. Please go ahead.

Great. Thank you very much. I wanted to ask about expense favorability that you've experienced, not just in Q3, maybe pronounced in Q3, but maybe over the past few quarters. Just the other, you may have got impacts on the key drivers there. and then when you look forward to Q4, just the level of certainty that you have in terms of increasing investment levels sequentially. And then I also wanted to ask a little bit about organic search trends and any changes there as well as paid search project acquisition. Thank you.

Thanks, Robert. This is David. cover your questions. So in terms of expenses, we saw favorability in the third quarter and we did see favorability in the first half of the year as well. And just to step back for one second, very much 2026 for us has been an investment year. And we made the acquisition of Batch in February and we mentioned that we were significantly increasing resources there both on the on the product and engineering side, as well as sales and marketing. And then we've seen real traction on the Yelp host side, and we're leaning in there as well. And we're continuing to invest in Yelp Assistant to make that a great conversational experience. And as you saw from our recent product release, we're adding features quite rapidly that increase the capabilities of that Assistant. As we go through the year, we're always evaluating how to deploy our capital and we also remain very ROI disciplined. So the expense favorability comes out of, in particular, some optimizations that we've made around marketing spend. We also, because we're leaning into more innovation, we're seeing more cap dev or capitalized software development as an element. and then there's always just a variability of a variety of expenses that are harder to forecast like healthcare expense. So that's the combination of things. In terms of the fourth quarter, we do anticipate that expenses will be a touch higher than they were in the third quarter and obviously we look to execute against the plan that we have and the guidance that we've given for the fourth quarter.

Yeah, I can handle, this is Jed, I can handle the paid projects. I believe that was the question. You know, we did spend, we have spent over the first three quarters of the year on paid project acquisition, particularly for our multi-locations. services segment. I think the name of the game here is making sure that we're very disciplined in terms of how we're buying those projects. Where we see green shoots, we're going to lean into it. And where we're not seeing the return, we're not going to spend as much. So we will look for pockets of opportunity where that makes sense and make sure we're very disciplined in doing so.

and anything on organic, excuse me, AIO or AIM, penetration of relevant queries. Thank you.

I guess I'm not totally, this is Jeremy, not totally clear what you mean on relevant queries.

Just from Google, the relevant local search queries that would drive some level of traffic, obviously, to Yelp. Have you seen any increase in penetration of AI overview or AI mode? Anything notable there? Thank you.

That's it. at CSI. Historically, that's obviously been a great source of traffic for us. We continue to get quite a bit. That said, we're diversified across multiple channels. We have some great partnerships like with Apple that drives considerable traffic as well as our own direct traffic. We have a very successful popular app that drives a lot of direct traffic as well. So in the quarter, I know there was a lot of discussion We saw some impact, but stepping back and looking at overall results, somewhat muted in the big picture. And I think part of that stems from the queries that we typically get a lot of our most valuable traffic from are highly monetizable. And as a result, Google seems to be a bit more cautious. with those queries. And so it was a bit more muted in dialing up or cautious about dialing up its AI overviews. And so we did see some impact there, but again, not as dramatic as reported elsewhere.

Got it. Thank you very much.

Your next question comes from the line of Jason Krayer with Craig Hallam. Jason, your line is open. Please go ahead.

Hey guys, this is Thomas on for Jason. When you look at AI-enabled tools that you've rolled out, I know you talked about 30 updates and features as of late, but as particular into the services segment, which solutions are helping drive most durable engagements with consumers and customers? And can you elaborate on any notable dynamics you're seeing between them?

Sure, this is Jeremy. So, you know, within services, one of our big investment areas has been, for a while, Yelp Assistant. And we continue to build that out. Originally, it was designed specifically for services, but it's become cross category. We continue to add, you know, agentic features like check for me, which can actually do an outbound call to a restaurant to find out Thank you for joining us today. So that's been great. Also on the services side, this is more on the business owner side. We have been working on smart lead reply. And so, you know, speed to lead is of critical importance to both sides of the transaction. Like consumers want to hear from businesses. And so getting a faster response with AI is really critical. And so we're going to be offering that. We also, you know, see great request to quote volume coming from Yelp Assistant. and so that's been another benefit there. Requested quote was up 10% year over year, so great to see there. Oh, and I guess, sorry, one more to throw in there. You know, in our partnership with OpenAI, you can obviously see just great content, not within ChatGPT and that's all attributed, From a service perspective, even more interesting is our Request a Quote feature is now fully baked into ChatGPT. So you'll see Request a Quote buttons when those listings come up and you can dive right into our flow. That's also partially contributed to our Request a Quote growth of 10% earlier.

That's helpful. Maybe double clicking on Yelp Assistant. How are you thinking about turning one time project into more like a recurring relationship with the customer? Are you noticing any behaviors between you know how those parts change driving you know repeat usage rather than simply improving conversion on like one existing visit?

Yeah absolutely our goal is to be as sticky as possible and as engaging as possible and you know that is you know Part of what we try to solve by being broader than just a services, Yelp Assistant originally was services focused, but by bringing in higher frequency categories, things like restaurant, food, nightlife, even spa, salon type conversations that can drive up the frequency, but so can some of these more agentic features, which is where we're turning a lot of our attention. and I think with the rise of personal assistants is really raising the bar on the expectation of what something like Yelp assistant should be for people. And I think it's a great way for normal people out there that maybe aren't going to be early adopters of some of these personal agents to get agentic features right away. They already have Yelp, they've had it for years. It's familiar if we can bring them in Thank you.

Your next question comes from the line of Sergio Segura from KeyBank Capital Markets. Sergio, your line is open. Please go ahead.

Great. Thanks for taking the questions. Maybe I wanted to start on just the advertising business. Advertising revenue decelerated again sequentially, and I think the outlook implies further pressure in the fourth quarter. Hopefully you could just unpack the trends that you're seeing within that business in terms of just traffic, SMB budgets, multi-location, advertisers, anything you're seeing there. And then any comments you could provide on October specifically if you saw trends worsening in October. Thank you.

Yeah, this is Jed. I can take the advertising question. You know, it continues to be a challenging operating environment, you know, for a lot of these local businesses, you know, where there's obviously a lot of pressure on the consumer between inflationary effects, you know, obviously consumer confidence is not where we need it to be. And then borrowing costs, you know, which particularly hits on the services side as well. We're seeing a lot of behavior and services specifically around, you know, repair versus replace and some of those bigger projects are not getting done and then on the business owner side, you know, the input costs continue to be very high, both on the labor side and things like diesel gas as an example. And so those are certainly impacting the local advertising market. You know, we are, you know, as a result, leaning into a lot of our other products. You know, I think when you think about RR&O, our Yale Post product continues to gain traction out in the marketplace. We've done a ton of investment on the product side there, as well as Hatch. and so you know we don't expect the local advertising market to turn anytime soon but you know we continue to invest on the consumer experience as well as for Jeremy talked about to get the system side and you know we'll continue to you know we still believe our audience is very valuable and you know we're also going to be making sure that our data shows up on all the places where consumers are would you know meet the consumer where they are whether that's other platforms like OpenAI or Meta as well as continue to invest in our

Got it. Thanks, Chad. And then maybe following up on Hatch, I think the ARR growth there moderated slightly versus last quarter. What are you just seeing there in that business in terms of bookings, customer additions, sales productivity? And I know you guys made some significant investments in Hatch. So just what's your level of confidence that you can accelerate growth within that business again? Thank you.

Yeah, thanks. You know, we're really pleased with the Hatch business right now. You know, it's an annual run rate revenue of $37 million, about 55% year over year, which is in line with last quarter. You know, we still believe there's a really large opportunity in the lead management space for these home services pros, both on the speed to lead side, which you can think about digital leads, as well as our voice AI solution. You know, since completing the acquisition in February of last year, This year, I'm sorry, we've been investing in business both on the go-to-market side as well as on the product side, really in order to prepare for scale going forward. Our product investments include huge improvements to our voice product with the implementation of GPT-Live and the continued fine-tuning of the models to handle even really the most complicated home services use cases. Our customer feedback has been very strong, and we believe ultimately the voice product in the marketplace, in part due to some of the expertise that we brought over from the Yelp side and were able to deploy on the Hatch business. We've also deepened our service time integration, which now supports real-time booking with things like adaptive capacity, which is really important to a lot of these pros. And it's worth noting that as more of this consumer communication becomes really AI-driven, including some of the personal agents that Jeremy mentioned previously, You know, Hatch is really well-positioned to help those services businesses handle those leaks. And it's going to be, you know, as more and more people use these agents, it's going to be important that the pros can kind of handle all of those communication methods. On the go-to-market side, we have added capacity on both the enterprise side as well as the commercial teams. and, you know, we are expanding into additional service categories as well, you know, most recently into kind of moving pest control and lawn care. Those are still very early stage, but we believe over the long term can drive a lot of growth in that business. So, you know, our overall posture is we're going to continue to invest in that business and feel like it's a really large opportunity and that we have the ability to take share as that market develops.

Okay, thanks. Thanks, Chad.

Your next question comes from the line of Kishan Patel with Raymond James. Kishan, your line is open. Please go ahead.

Hey, this is Kishan on for Josh back. Thanks for taking the question. Given the macro trends affecting services advertisers, how are you thinking about balancing customer acquisition marketing spend going forward?

Yeah, I mean, you know, we touched on it before around kind of our paid project acquisition. You know, we're just going to be really ROI focused and disciplined in our approach in terms of, you know, acquisition costs. We obviously are going to continue to invest in the customer experience as well, whether that's on the account management, customer success side. We want to make sure the folks are trained properly in order to use the system that they're converting on leads. One of the things that Hatch has taught us is when we step back, getting the lead is obviously a very important part for the service businesses, but you've got to be able to convert on those leads as well. That is a big component on whether these folks are going to see ROI. You look at things like Smart Lead Reply that we're investing in to make those leads More effective, the ones that come in. So, you know, we're going to continue to invest there. And, you know, from a paid perspective and a marketing perspective, we're going to be really disciplined in how we're going to end the crisis.

Thanks. And then how are you thinking about scaling Yelp's host go-to-market? And what have you learned about which restaurant segments adopt the fastest?

Yeah, on the go-to markets, first of all, we're really happy with the progress. This is a homegrown product that really launched about a year ago. And we're really happy with the reception in the marketplace. We've handled, I think in October, we're on a run rate for about 2.5 million annual calls. And really on the voice solution side, we believe we have leapfrogged the market in terms of voice quality. We've been testing with some bigger clients. In one example, we had our food order conversion increasing by 13% after deploying our new voice solution. That was a nice proof point. This is a big step for a lot of these customers to turn over their voice to an AI voice agent. It's oftentimes a land and expand. You've got to prove ROI, but we're really happy with the way that's going so far. You know, our food ordering, which is relatively new over the last two or three months, actually started that in June. And it's very nuanced. You can imagine all the different versions of ordering food. Am I gluten free? What do you have on the kids menu? Is it good for kids? How's the noise? It's got to be able to kind of handle all of that at once. and Food Ordering specifically through 6X from June to October. So we're pleased and we believe we have a good head start in terms of the quality of our voice product. And now we're just going to concentrate and make sure that message gets out there. And that's going to be done through our go-to-market team as well as, you know, marketing efforts behind that. You know, I believe we have a moment in time to go showcase what we have on the El Paso side and we're going to pursue that aggressively.

Thanks very much.

Your next question comes from the line of Colin Sebastian with Baird. Colin, your line is open. Please go ahead.

Hey, this is Zach. I'm for Colin. I guess I'm just most curious, as you scale more of the products requiring AI inference, are there any efficiencies you're finding or leveraging within your cost to serve across pricing, product design, or infrastructure efficiency?

Yeah, you know, I'll take this one as it relates to kind of internally at Yelp. You know, over the last couple years and, you know, I would say particularly over the last 12 months, we've been really leaning into AI in order to drive both efficiency and production, quite frankly. You know, it's one thing to say, but, you know, we want to get more production out of folks. You know, the most obvious returns, as you can imagine, have come from our product and engineering teams, you know, where the velocity has really accelerated. As evidenced by the latest product release, I think we had over 30 products and new features in the last quarter. And you look at something like Yelp Post, which was a kind of built from scratch product, and we were able to make a ton of headway due to some of the advantages we've seen with the AI engineering tools. but we've also been aggressive throughout the rest of the company in deploying AI and solutions. We want to make sure that they're measurable and have impact and you're not spraying the AI around the company but we do see a lot of pockets where this is making a big impact. Some of those examples include pipeline management for the sales team, all homegrown, real-time coaching, AI tooling and that's in cross-marketing and We're going to continue to lean into this AI transformation. I think you see it externally with our products on both the business and consumer side, and we believe there's a real opportunity internally as well to make sure we're driving efficiency and, more importantly, kind of more production out of the resources that we do have.

Your next question comes from the line of Nitin Bansal with Bank of America. Nitin, your line is open. Please go ahead.

Thank you. So as you expand more into AI products, how is your go-to-market strategy evolving? Can you talk about what are the key initiatives and pipeline that could accelerate the growth in the other segment? And on the advertising side, can you talk about some of the puts and takes and key initiatives and pipeline that could drive stabilization in the

Yeah, I can kind of take the go-to-market side on our new initiatives. I would say that our posture is aggressive in terms of making sure we have the right heads in place to capture the opportunity and the right resourcing to capture the opportunity. I think when you look at Hatch, as well as host. These are new markets. Folks are making decisions out in the marketplace and it's really important that we have the coverage across the enterprise segments, across the commercial segments to really take advantage of that. We have a ton of in-house sales expertise that we're deploying out to those other initiatives, specifically host and hatch because we believe there's a large opportunity for both of them to have have a bright future and we want to take advantage of that.

Your next question comes from the line of Brian Smiley with JP Morgan. Brian, your line is open. Please go ahead.

Hey, guys. This is Vignesh on for Brian. I appreciate you taking the question. I guess it seemed like the R&O ad revenue declined double digits even though it's like the paying ad locations were up slightly. Could you maybe talk a little more on the divergence between this and kind of what needs to happen to maybe stabilize? And I appreciate the cadence on kind of expenses for next quarter, but anything maybe into kind of next year and how we should think about expenses on that front? Thanks.

Yeah, I can take the question on PALS and R&O revenue. You know, R&O revenue is down 13%, and our PALS were actually up 3% R&O. This was largely due to some multi-location customers that increased locations but didn't necessarily increase average revenue per location. I think stepping back, RNO continues to be pressured for a lot of the reasons we've mentioned before. Consumers pressured, obviously, due to compounding inflation over the last few years. and, you know, on the business side, you know, they continue to really face high input costs, you know, and so, you know, we don't expect that to turn anytime soon. It was a nice to see those paying advertising locations, but I wouldn't read into anything in terms of, you know, kind of, you know, really sunny days ahead.

A reminder, if you have any further questions, please press star 1 to raise your hand. Your next question comes from the line of Shweta Kajuria with Wolf Research. Shweta, your line is open. Please go ahead.

Thank you for taking my question. How should we think about EBITDA margins as auto revenue scales to $250 million in annual revenue? And for my follow-up, As we think about auto revenue, how is it trending compared to your projections of auto revenue scaling to the $250 million mark by 2028?

Thanks for the question. So in terms of the margin profile of adjusted EBITDA, again, it has three components to it. There is the transaction side, which is going to have higher margins because it's really B-gen for a restaurant order or an order on DoorDash. We have the licensing product, which is data, which also is going to have higher margins. And then we have the subscription piece, which is we expect over the long term would normalize to what you typically see for a SaaS or software enterprise software product. but in the near term, we're certainly investing against growth opportunities. So that mix has a contribution profile, but importantly, and just to emphasize as Jed really covered, we see this very large market opportunity for both hatch and host. And so we are definitely going to continue to invest in that. And then in terms of the progress towards The $250 million run rate target by the end of 2028. We hit a run rate number in the third quarter of 136 million. It's obviously a bit more than halfway there, growing at 82%. So we look forward to continuing to execute against that opportunity.

We have reached the end of our Q&A session. This concludes today's call. Thank you for attending. You may now disconnect.