SSTK - Earnings call transcript Q2 2020

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Operator

Good morning. My name is Jake and I'll be your conference operator today. At this time, I would like to welcome everyone to the Shutterstock Q2 2020 Earnings Conference Call. After the speaker’s remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. would host, turn of Chris and Relations. I to call Corporate time, Investor first our Suh, this like the to over Development At Vice President Sir, go ahead. please

Chris Suh

for XXXX earnings morning, and Good operator. call. for you, quarter thank Thank you second Shutterstock’s joining everyone, us

or our without of discussion today Yahes, of including the forward-looking the the long-term will new during Stan our our information from investments will business, COVID-XX future our and targets. the business, is trends future product, forecast. Please consist on results and existing statements, and Officer. me our effects Chief you Financial Joining growth, of could Officer impact our of impact differ note strategy in today and of profitability, performance Executive limitation, Pavlovsky, long-term our materially Jarrod financial margins our Chief that success some our our and hear Actual

currency posted on today’s press Form in of directly our constant EBITDA to net Relations financial in measure from please We’ll annual forward-looking included Reconciliations file XX-Q make our the and revenue Form income, filed measures XX-K refer XX-Q, discussed on for materially that with release could in the section a by billings Investor we cash discussions report our statements adjusted comparable channel, to EBITDA, most press SEC For the of be factors including Form on the found more and the time-to-time, quarterly with margin, website. measures information, risk today, today’s GAAP we including and our and adjusted most be call. non-GAAP recently which adjusted reports are the financial cause discussing can growth, actual report certain release on to including and differ important our risk may results of tables on factors these any distribution non-GAAP from flow. basis free

posted that IR we And of contains turn information Stan. today's over to the well interactive section on please now materials for available refer as brief on call, this Microsite supporting that is our to call website. at the new Finally, I'll time, that the Shutterstock's IR website the as

Stan Pavlovsky

of forward to increase we as welcome our towards Shutterstock. quarter outreach communications and contributions customers. begin everyone, you Shutterstock's focused dedicated We remotely I thanking working credibly community. all employees the our Good look have earnings been time and wanted by of during Shutterstock and Chris, for to second and who effectively our transitioned your service Thanks, have to call. continually and offer continuity thank this joining to to morning, investment to

quarter compared proved revenues As we to at strategic Shutterstock's a plan be making how of shareholders. data workflow of strong the in much second and innovation, the digits. our insights, are returns services deliver to more for trending our efforts, were expectations, on our as as April their progress as well content resilient and high single to on down will we focused which end result relative

year, and last revenues X% currency million down basis. from Our are down second a XXXX quarter on $XXX X% of constant

of includes last with year, Asia X% declined half are of quarter. quarter growth In world back European and company. of the grew investments the rest America Our regions this making which North the consistent long-term in region, the while modestly we

strategic is of platform several to teams. and customers and ways. applications platform natively investment key mission-critical consume integration our in Shutterstock growth content look and within services our highly to major ad to our solutions applications. website offering solutions our global technical builders We undertaking is First, our from are creation and we redeploying benefits expansion The enterprise Shutterstock tools offering us in area as believe a that this sales and for significant capital into

our expect accessing up these we're new us. we for customers' because effectively relationships market First, to segments open customer,

in volumes, we a milestones, engagement which builder. and Facebook, the up new tend platform consistently. the users to solutions as active for result our to retention daily stickiness. initiative. And enhanced new through integration, have partner go available their and finally solution engagement, tend customer and result offering we launch recently all Second, makes by achieved revenues Microsoft of advertisers ads Microsoft in key our monthly is content ads to Among a measured relationships With higher were levels platform customer as ad a large

Content new create beautiful Our are of advertisers to more available in a Editor and help ads. performance part Facebook ads

platform driving to relationships business by nature into also native more stickier are and our into it Enterprise make Enterprise deep We becoming recurring in workflows.

Snap, just to our Enterprise For from X,XXX last to to tools Weight within just customers grown get content of our over and easier platform Watchers the the use number year, our we integrations we in API Insider launched X,XXX day. weeks. have they offering it every two past access solutions and in platform the made for And the integrations Business example, over

discussed both new year investments In our are with we to half long-term order building addition products to marketing quarter, of multi-asset on back focusing within have subscription offering, solutions investing in to in we differentiate our and to our out roll in the rolling With reach marketing music CEO products out. position support Last that tenants mind products, for and for new share brand support in significant in range aim I'll success. and products business some I the three as us we of efforts. planned a these be platform Shutterstock planned subscription and with of the

customer that is that fresh. and data drive enhances relevant and First innovation content insights and workflow, performance that our

ensure about that to few investments we is and talk our to This made I a quarter, want fresh. content relevant

cost manual than our effectively content onshore automation using enhanced and have we lower First, resources. AI ability cost and ingest rather at offshore review a to

ingest reduce address content the the scalable content we the the will our allow expect our to nimble, we more margins see us to and respect content gross that with top-of-funnel, can that at needs makes to tailoring – to You of more of automation as This be more duplicated improves quarter. the us market. benefit in this ability

We to get for drive this and to implemented this some I'm time, have results. been proud see and on technology working begin

product to the fresh the library expect better growth our we beginning this enabling royalty as with subscription I our to will a content space retain subscription in and clients current and own, align drive higher-performing In and model, digital previously, content Second, structure to our June, for content of capture order incentives prefer and purchase contributor from accelerated advertiser' audiences. result in creative their of mentioned towards in evolved via we demand and order sales. to increasingly fresher content attention future

core Lastly, of we that inclusion Seek Shutterstock belief contributors, customers, perspectives embody our amongst are our and and making investments to foster employees. is strengthen business. diversity a valued diversity different and principle our

our to artists, diverse musicians inclusion talent dedicated community more more We diverse have content we're our acquisition AI more This photographers, includes performance to of in more management to and the program collection, and drive historically content, launching improving supporting to workforce, network. initiatives. but diverse environmental and and diversity committed contributor and and programs our grant and localized inclusive awareness to videographers our a surface leveraging who build a focused much amplify powerful doing on diversity voices in

order a more Shutterstock long-lasting a in impact model. into to provide business, and we and As leadership evolution team, communities. at this the In subscription-based investors our KPIs a support and we inclusion of introducing in to company of transition particularly as are three making for are towards internally we track our we insight diversity are believe primarily quarter new as important to and business, that our committed

always share to have become the Jarrod he component of as of details our KPIs and business, expect Custom, including minority revenues over our results. our it but of these will will discusses financial expect meaningful We Editorial non-subscription some time. that new a

to Lastly, and we around progress the flow tremendous expansion seeing through. starting initiatives our see results margin in are we're

adjusted second and several representing XX%, was performance last This EBITDA which improve last up quarter from the Shutterstock, our up represents which a is record across Our initiatives XX% for and in is year. operations. it technology from the to is by margin driven -- of $XX content, of quarterly XX% efficiency marketing EBITDA million

to Jarrod our team enhancement this we're I we turn Shutterstock it to strong over the momentum, margin are our and financial continuing M&A the handing Before to margin with execute detailed a And shareholders want that, back Jarrod. our With focused quarter. capital in great of executed, on performance now with to several of deals while to for record on initiatives deployment review, for over growth, additional a maintain I'll margin on thank to execution. call place and reward the returning our

Jarrod Yahes

and morning, everyone. Stan, good you, Thank

trend in quarter, first Revenue of saw single quarter pandemic. and am prior in X% both currency X% in Let reported improved our second weeks we report our good me in the of about second April, the quite predominantly declines goals. revenues When and revenue resulting strength our accelerated year to and the we down the and attributable start last saw on a quarter digits to by the against which declined we was the into of May impact the of that constant pleased April the we saying the second were saw year-over-year couple March in we I compared relative progress high the quarter. June, in basis. feel to

revenue decreased our X% to X% increased channel to Enterprise $XX.X e-commerce Our while $XX.X million. channel million,

America North the rest and return in the digital the Our tailwinds to growth our powered marketing e-commerce displayed of of business. as customers and and our proliferation demand channel multiple growth world work website

to mentioned, not Stan has XXXX the yet As European recovered levels. geography

for of Our place we through growth we still of have will an believe Enterprise differentiated several revenues. a to it need prior and result is sales quarters, largely are we key channel. to poised articulation our success largely quarters down proposition. billings in year-over-year point, we achieve We improved eventually and revenue growth do in product The deferred leadership Enterprise channel lower in suite the the for bookings at in was take as and the shine believe this value that and

improving Sales profitability depreciation approximately gross in The This during marketing our of of reductions was including is driven platform the positive on content by marketing into demand quarter infrastructure technology around of we the the plans progress in pandemic. as our in the favorability process, of our and revenue XX% both in royalties factors, automation efforts level XXXX. and year, marketing seeing and spend, tight scrutiny lower X% XX% spend to marketing were XXX significantly revenue, expense second points we up top-of-funnel expense XXXX. basis investment. an a increased in XX% signs our margins adhere sales in to performance second Based and our spend marketing due been our is and to second introducing terms metrics number of back quarter, in reduction to in performance due on half utilization more XXXX. improvement quarter from accelerating the expense quarter of on AI return as margins with costs Product were drive of In the to we've subscription we're offerings. margins, and flat and from and of XX%, our the ingestion the of and in the compared costs the second expect marketing of development are to

efforts development expense, decrease and are attributable platform assets coupled $X.X XXXX. of XX% million overhead reported amortization sheet. net in from Enterprise were quarter second vendor fixed down balance and which of elimination and on within of software around capitalized product in to Our and XX% is of process reductions of stock global G&A automation is G&A The with expenses renegotiation, revenue, the consolidation. the revenue our expenses labor, reductions cost our compensation

the diluted in million diluted in million XX% share not $X.X QX share, of was since EBITDA to $XX or beginning margins per of are by year or which XXX of expense, do compared $XX net and We Our share GAAP EBITDA $XX.X back million diluted million expect income the regard in increased efforts the quarter the beginning in XXXX. income adjusted material second of Adjusted as points. severance severance adjusted impacted or margins $X.XX to shine second $X.XX compared half the basis XX% through. expenses of this to million per XXXX. to net $XX.X was $X.XX of quarter per year. the included

of the flows. had increase up end $XXX quarter, from Turning sheet was the of above cash XXXX. payment cash per our $XX and we the beyond March to XX, The at of of million million our balance cash, million $XXX in June $X.XX dividend quarterly share. At and

flow XXXX. million Our free business $XX.X free quarter cash compared is on the increase consistent volumes. as cash of in second was to to due flow The profitability million $XX.X year-over-year in improved

from The in XX, Our due predominantly at million in million March declined not our which to revenue yet XXXX. deferred business balance XXXX. is has change Enterprise shown deferred bookings revenue $XXX.X $XXX.X accelerated to

quarter We website of with schedule this Investor section a are to deferred our on at billings new of providing reconciliation investors the a revenues. Relations

channel, revenue to deferred around the will this first our revenues result recognized indicator back leading a and growth good growth billings As provide we the in and Enterprise Enterprise getting turn and in channel. in progress of

providing As Stan previously this three of insight will into quarter mentioned, we growing our subscription operating provide are new the that metrics business. nature

and footage Subscriber Subscriber to on consume is to driven of to allotment. customers as Subscriber of music previous growth as quarter provided our with increased the X.X% larger the XXX,XXX. basis, some XX% key last our subscriber $XXX. our regular subscription and and traditionally and represents products, growth growth size our our metrics with Reviewing per a year. well small prefer in and associated year-over-year increased around revenues image mix XX% revenue growth of content revenue than product products. the growth a of up excess X% subscribers in higher subscription year-over-year revenue $XX.X was download products from operating monthly We changes have volume well revenues, library. metrics customer increased video, XX% due download, are subscription in of to in to also in image we revenue maintaining Average as being by increasingly our of million our growth and the second trends all per

increasing is and as Custom strategy to platform in X% average well declined reduction quarter, Enterprise our to related resulted the revenue $X.XX in download. Paid the long-term per particularly in pandemic. utilization our This per increase by business. Our activity by cross-sell download leveraging offering, revenue to customer, of downloads channel as to mainly to Editorial $XX by $X.XX due and second solution million the per

image approximately video XXX expanded approximately XX% by XX% our library to Our library images XX to clips. million and by million increased

In terms XX, on per share dividend its XXXX. payout of of capital allocation, will September quarterly next $X.XX Shutterstock

they plan we'll on With earnings continue at execute. previously opportunities, be periodically are fit. we flow second disciplined on strategic like M&A we of to line and based and actively we in year, to the so the and As M&A compelling to dividend grow alternative a great strategy, we with integrate we industrial of the be forward-looking cash the as respect have can I'd the capital. some growth expect. From to revisit what confident looking we're evaluate profile assets stated, our provide We'll our uses the we perspective ability present to acquisitions color and a on and payout to logic in that half position

fourth investments overall by We and as that. focusing the quarterly are company and getting working towards marketing to we're sales our back revenue around a quarter growth

will margins margin expect investors operate. year, a down and we and course course impact of which on marketing and out resolution the the the the and were growth takes as come of QX the geographies that the From the back should get to perspective, reinvest be back margins in spend. in of various in world to exceptional to sales pandemic ability half solutions platform we in dependent in Our the somewhat those

a increase. year the increase the GAAP compensation tends in based on expense EBITDA expenses in G&A expect stock of also increase half comp expense. performance, non-cash of back Because stock the We the basis an to strong to on

still we've points than XXXX in in While year least the we second that the targeting calendar half as are to confident severance lower including highly of and of overachieving we margin XXXX year basis at will that year-over-year of EBITDA back XX even expansion compared margins are be the quarter, occurred year-to-date. target the on expense

frequently is with its our believe investor to fully proud key microsite, approach, a Microsite of PDF that into will and complete videos we're roll We on interactive presentation. charts Relations management a Investor navigation members and drill our virtual, kind team, this section most new with Lastly, graphs self-guided of of interactive parts Relations to dynamic website. Shutterstock's of of the Investor that static and first out today our interactions responses type today audio entirely investor investor compelling go-to-market are rather story down of Shutterstock With questions. TAM this engagement almost to investors asked investor via than allow the

to well margin some resiliency We the year, second management driving execution press of back now line allocation the questions we'd in that appreciate thank are our we in to our any plans. of half to quarter may you to continuing as and investors and team reinvest our time pleased margin In Operator, with capital and as the We us. today with open get your joining plan back improvement of to a growth, profitability. the for analysts while forward have. for as the revenues like

Operator

Thank [Operator we Squali go a SunTrust. ahead. Instructions] question you. Youssef Please from have And

Youssef Squali

Youssef And very the on Squali. additional us. I you quarter. on thanks two much. awesome. for disclosures Hi guys. website, very guess the questions Congrats It's strong Thank a for Jarrod

I I EBITDA you even or ended saw remember up impressive XXXX causing should eons XXXX time think I the was guys in which First music little have maybe can that hoping your versus versus the I relative the image kind color to of of that may -- just the you contributed. ago. go margin, you what product around don't like I was type provide doing expectations, more say outperformance? XX% back kind around to quarter the Any is a to video more And outperformance surprised bottom-line. that last maybe probably you have

at guys doubling kind guys But ex-COVID? all out from some as structural on the gross of new could lower you're step do of think relative you guys this support the to forward? So, on investments. long-term down kind you what's months look were some potential for T&E making, normalize ago? of potentially -- of you cetera I that Clearly, of business new some these changes EBITDA six you that, that there based margins where now where changes and of of you But going related business can of you back you think Thanks. kind we as the kind shake -- on and benefits going thinking just maybe EBITDA, to COVID. level comment can the are be to et margin the know And were to you

Stan Pavlovsky

Yes absolutely.

So, to nice Youssef, you call Yes. safe you're the and healthy. first on have and hope staying

So, from little going first forward. -- bit then about take talk the I'll question EBITDA margin Jarrod and and will a

as small is working which And not challenges been from the some certain has sort as revenue We've from movement with and also about et completely of consistent products really SMB we travel for products happening sort that the has hampered from particularly has some assets after started verticals. a significantly, the as media, in far nature. to more of like where been of hold. lot example an cetera. of new subs, seen bring of As on content subscription market, digital video the then -- well brought customer talked perspective, which Obviously, increased. are new product the prosumer go that business some to have new secular that smaller a market. new need has taken And call, subscription revenue, we and on the are trends definitely We've we're image also to again, in immune

as we're and what services custom help products. customers to use commercial is trying in our with for new the editorial such So, really doing meantime

EBITDA as and facing talk particularly went that really a into are And that to headwinds able pandemic. bit we've let of about the So the we -- many offset been it's of really and pivot some helped the really because are us and May -- margin to I'll little June it's Jarrod trends.

Jarrod Yahes

Great. Thanks.

for think business. of I up Youssef, pleased the objectives our year-to-date against execution taking the with quite profitability we're So our

the business think XX%, we believe there year-on-year -- of going G&A And in leverage of margins revenue quite not there's that while G&A level percentage about that XX% quarter annual percentage the is is the and the to was think before, believe and is company. spoke something the at in quarter get the think a The continue I in second EBITDA beyond of the G&A. that several model the of when experienced we to in of XXXX revenues we years. the quarter level was for right I as we in least is G&A. last operating leverage for level G&A to exceptional that allow and you quarter as as past next leverage expand really second a our And us this of in XX%

would sales other operating line. leverage and longer-term that say does marketing in area I The perspective a the from is have

why You'll bit a there our marketing see marketing should evolution that and really The that a go-forward long-term basis a on a which of revenue shrewder side business and as on towards the flip sales are subscription we've of is sales model. reasons of expense. decrease gotten percentage systemic also is

and more business marketing and to customers your of the more and becomes subscription, challenge more new growing acquire in become your performance it business. retention becomes business terms need a efforts of our of really expanding via less As

be cost of gross sold we leverage that systemically goods perspective, line and margins. would take do that marketing We long-term some gross us believe long-term our really plans that of products. model there not to have that And competitive allows of a that say the reasons revenue our there margin effectively going in line. up sales so have the terms be subscription market want to have to pricing a our We in in matches we will however, why are I From forward.

marketing think a you is a so of perspective quarter sales meaningful the leverage The line as result this when gross the up gradually margins of line as gross that up. a business margins evolve go you more leverage we some and systemically the subscription mentioned in would and from should something over model. with several of while think I came expect long-term that stable towards that in And that modest don't reasons we to G&A time be

Youssef Squali

Thank you, guys. helpful. That’s Okay.

Operator

question a Company. Needham have & We from Brad with Erickson

Brad Erickson

Hi, thanks.

a few. Just

you the in quarter? if subscription the context when portion maybe your of at And higher sort of what be revenues of that how and that we revenue drove mix So in thinking think could first sort higher just of per the the the download about about forward? going you just content should moment of put

Jarrod Yahes

Sure.

So reduction function Brad, when higher really you in download a business. the about per of revenue of think the utilization it's a

So as the number revenues capture those of to paid downloads decreases fair because without of costs. the are of amount able revenue subscription we associated nature of our a ultimately,

And of happened in what increase so we experienced if X% of X%. and or down approximately experienced within paid you at kind download we an revenue look rounded the approximately quarter, X.X% per downloads

So our the effectively revenues. of the of mathematically nature other offset two because each

Brad Erickson

Got profitability long-term you of growth it. right the second me I back the to then And That's over just that about to other? signals equation the are And guess your great. prioritize put balancing And seeing leading about you philosophy versus now talked maybe half. in one work there? dollars talk ad how

Stan Pavlovsky

the making it's while make at large and But of one sure perspective business, a least want decisions to think, categories Jarrod Yes, that. where innovate we're of the we want being growing the that the to that's I -- growth we new Brad, balance, I definitely for players. growth into we of it's then, acceleration. on we're areas we're mentioned, as And around and, focus increasing and very that in continue the from areas move think as there's category core to rate business, about be our surgical the at -- sort margins, trying we're to for adjacent

technology, well have improve been don't leveraging think of leverage continue will kind and both of And able continue investments that that -- changes core, dollars we around as sometime some of our areas but leveraging augmenting while opportunities still around that, ingestion, invest, So, the we other in our business. growth in to for the example, marketing making growth, balance the the are content time of as investing really to sheet future to over the business business. have that continued and the do in these being impact in the for or we

So of we're in, stability the very excited business. we're about the because the financial that of position

Brad Erickson

great. one And maybe last in, I it. one squeeze if Got That's just can.

the things to like of folks towards just the about the mechanics just early the to to partnerships? return on next Enterprise year maybe Is force happen growth? the those as business. towards guess, trajectory Beyond year, more Maybe solutions talked a looking can end growth drive macro, the and productivity of side what side the the to sales Is talk of return ramped? needs what it platform picking You I the about kind get there? of kind Thanks. new up on Enterprise of just,

Stan Pavlovsky

Yes. No, absolutely.

of solutions. is, top-tier solutions, segment as and several sort for our strategy Enterprise are of going clients. the So, initiatives or platform the of combination well including And as average through SMB is a several made up the end-to-end our of top-tier parts size of business, forward, providing our deals. those -- the that's to And definitely have value increase clients, we order turnkey

acceleration Enterprise. further head move new and to the year trends exist the medium when around it this into the services into launch think the because of continuing see, and have you'll we to we're comes We to segment, tailwinds some digital as that e-commerce. So the particularly that small we of

seeing SMB so, both platform well segment. solution as as that, And we're in our

top-tier So, the in clients. high really, are say I we would or I the guess, is, end what

talked in as an in the we're development heavily opening that Jarrod sort effects for that, industry platform from expanding for in because some penetration seeing signals we're talked accounts then, of partners part about remarks, a of going landing trends our lot into that a and audience of about business, about network of, the of invest and adding advantage sort excited a as to both a more And really part from for around really value We Shutterstock continue room of my as our -- perspective we're to creating of well and offering. those business. I our of lot taking have And SMB. of well solutions as perspective, we're as

So within platform to partners. products we'll be within innovate of and bring services solutions our all to continuing to our API, new

Brad Erickson

Got Thanks. great. it. That’s

Operator

you. Thank

We have a question from Lloyd Walmsley with Deutsche Bank.

Lloyd Walmsley

in Or to you Thanks. going to margin? royalty course have going in the have full quarter how kind about changes that's talk the for that, a firstly, payouts did I should expect account And how the couple. increase source know And doing you related be I on Enterprise seasonal segment some And from in the gross changes over benefit one gross guess that? the side. of you are getting been around broader you have gross margin back how Thanks. second new talk critical can that the to half kind kind growth? of the you to we guys variances is I of margins contributors? to Can to a to to payouts guess, Enterprise go-to-market there contributors? and second of rising that I on then to about customers. year

Stan Pavlovsky

Yes, absolutely.

that impacting hosting things including A really make this to sort as -- as automation costs process content gross big things injection lower is the a and first due download activity the our manually. benefit of credit is the there fees, content centers, of royalties. experienced doing to one card sure of contributor the want change that data we clear are So as compared it of well costs, part to the gross ingestion actually that several margins of quarter is on margins are royalty that I

some product will longer-term when business in So and of are about, will the variables let happening the on based talk I'll continue take of at kind what's the are talk question. that look expect et several impacting gross year we Jarrod rest others Enterprise let -- there margins and vary Jarrod I'll the sort we -- about mix cetera. of, I'll and the of the then which

Jarrod Yahes

Sure.

expansion I are that long-term, between as our of really importantly our over the our gave So focused that mentioned, on well maintain enabling I as we're subscription the strong think, of gross a talk business. regarding I we we're And margins in successful able sure EBITDA most margins making offerings matching have when to our goods revenues that cost sold. a we as

of the we the structure important it's today pricing our it in subscription the out to As to able would gross significant quarter. because June gross don't mind we to and the in forcibly the third the to like prices. result have months customers those offerings, do is full economy. of be and that in in expect well-positioned we're fourth to our in market. to They any place that in that kicked three itself market keep able And way end basically the and be we to in time. with But offerings enables flex our so believe today equation be we unit get have increases to cost-effective in to be to margin stability our come that you would end other roll want them margins maintain of able and over consume lower that expect customers tend for solutions to in subscription we That are structure structure that. them bring And

quarters. because and way time drive in we're retention a is that of several business thinking addition and around net just of over course our there last the subscription of subscriber the which business, respect leveraging to the our in becomes is really we've nature marketing costs of in being that's our less bring think customers growth. the new perspective about expense believe G&A order challenge that increasing to need do to from I over subscriber with a the gross revenue about sales shrewd stable And talked we So to margins, really

feel industry that the in So position how think we we're well as where continue for think I model And good as we years come. the quite that's evolve today the is subscription about towards today. I in a are to to going to

Stan Pavlovsky

much KPI one Thanks, Jarrod. existing new to as growth Enterprise on Enterprise terms a so new is of we pipeline that look at are a we and internally in traction year, that customers your pretty then definitely of when it is penetrate we net for key kind growth and and and new part of great the than then a key equation seeing strategy and a at from we're on we of is weekly platform that. into perspective logos is services look at our and look the and is retention that logos a prior and critical something a expand that's point of greater new that And daily great definitely well basis accounts of lot as bring with

Lloyd Walmsley

video the back think this just by new if the the subscription much number I I -- products growth How lower growth quarter? And products? And maybe the of I it drivers versus driven quarter, some new new in new number had this more versus revenue of of going tiers the Okay. is the is some tier were priced what product lower-priced -- to format new can subscribers you ask a but guess growth. of of products new -- versus I guess one

Jarrod Yahes

Sure.

to significantly for subscriber because that kind faster and So subscribers increasing new tendency don't than products small of fundamentally why to prosumer of give of product. product, The of by so is the growth consume number Lloyd, of we segment revenue going out this give out the is we're growth we some while subscription the not by success subscriber the some reason have. revenue

come can per creatives So TAM the we for you going of casual website. to example $XX do and consume business. products. is month our believe preference smaller industry more to They a XX per see the assets is talk about we the stock drive those kind casual the are They some are existing our have talk of And a at within starting for to market subscription say about that from really some don't intent to that we XXX on subscription that our of month, expansion homepage tend product need creatives our that which of product.

we've what product, our a where a just some mentioned in traction as release that's last quarter smaller while so we've seen image And an not low-cost its subscription growth product. is I of and about press We out those seen we've seen and products of growth put activity meaningful is And new going footage that Shutterstock's to by we're product product have lower or and of seen to clients a And basket of product, new sales take with music in cost increased products. erstwhile also subscription buyers that's a supporting number gone be were a PremiumBeat that market that with up who we've we footage marketing. product.

really subs those subscribe prosumer subscriber are think growth driven revenue by driving cost in I this growth. of the lower trend of forcibly what is excess So segment

Lloyd Walmsley

you guys. Thank right. All

Jarrod Yahes

Lloyd. much, so Thanks Thanks.

Operator

Thank you.

ahead, with question Jefferies. We go Giaimo from have sir. a Please Alex

Alex Giaimo

looks from growth taking company. you couple bit a looking a questions. Okay. Thanks previous at revenue growth, X% is the guys. the analysis you're it goal for And of standpoint. mentioned questions to deck stock A to an But follow-up overall to imagery as put reading a at looking of back slide had you addressable if in guys the market just about industry that I'm like out, correctly get

seeing the X%. lastly, get that have taking So revenue to should you the expand and future to margins, XQ, company? that we competitors decline maybe And some in North that to dramatically upside? where in Star to while of are what happen needs Shutterstock more just eliminate consider the able growth participate also revenue were then can share And for maybe

of was levels again given So current and Thanks just relatively confidence your in does raised you more top guys. spending that steady? the as that in baseline still revenue sustainability you the fact a give maybe line

Stan Pavlovsky

result category I into this et true Yes. were lot had those pandemic. would the expectation cetera, year no some a question, similar the expectations of Great growth are retail say to advertising, what around of a expectations around going longer And as the Alex. of that is X%

a that expect key absolutely that would player sort to of right in would expected X% was space. you're what this the for we growth category So this be grow as

are that growth. could several we also Additionally, the we that long-term at that adjacent are looking in there categories us accelerate help believe

we're get at Again, get growth so very hard workflow projections we really additional believe But pretty those from and deeper customers. we actively And days and these looking to not are integrating that in categories. growth around. with deeper can definitely being our our accurate hands more

to continue and in we'll look at so, investing And that.

had have talked we going But, and going confident XX and that margin of definitely We As far the in about -- increasing at start profile definitely year to going our business. the basis exceed think exceed we're that goal going that improvement, it's room we to beginning as something that we stated focus the of we were the forward. to can stated the forward, leverage meet points our on margins we and business we a expectation, that forward.

Alex Giaimo

Stan. Thanks, Great.

Operator

[Operator with Instructions] question you. have a Thank from Youssef SunTrust. We follow-up Squali

Youssef Squali

Hi. you. Thank

in is any there into solidify today adjacencies the maybe reference us business you think be M&A kind or exists prepared as guys. again just of would remarks. the to you kind help that Can type frame earlier color to either it accelerate help to technology, follow-up a of Just it Thanks, help of could products you Stan's just incremental whatever going about your comments either helpful. So, the some business? very

Jarrod Yahes

Sure.

Youssef, then and I'll let's on. give tag comments, some Stan

apparatus, two we're us stock from the opportunities in We're And give I that in of community. We new are disciplined We them. regularly believe number looking often types perspective space. we potential type very looking opportunities we're at our which our content at there's with think and And in been uses consolidation looking content terms at also, There identification machine give specific contributor at those image, content may an is from our two are up we AI at. either, of and use access and content businesses area with and few utilities an at as we've areas technologies, to front-end quite selected sales look we creative our customers creative in music great frankly, at for marketing to growth content workflow of and the look the There's to or channel deployment and to us typically perspective, at are a additive a a a we at leg margin look other cases well cases. look and how create a actively. that that that with short optimization perspective, profiles these of type we of we in a a there's respect time on to over be the and approach. are Tools specifically out get on at look area multiple terms opportunities. our But content actively marketing to dynamism a cost that businesses. that looking either website typically very accelerate accretive XXX looking a in million up of or that those be, people of period of on basis a take transaction order opportunity of think on performance from acquisitions companies businesses the use We're content manipulate revenue that the to yet looking within immediately as also of based based these at. of in multiple of learning video, margins. with are leverage not strategic the is These terms would can mature.

kind are that three at of areas we strategic look the to or look those in plays we of at. consolidation So, the four addition regularly

Youssef Squali

Sounds good. Thanks.

Operator

Thank you.

the in queue. questions further no are there appears it So,

Stan Pavlovsky

our employees, we're customers opportunities proud well and that to take engagement. very I'm last so excited organization. advantage opportunity the you believe future, contributors our thank their be more the Well, everybody. our to of and of one ahead. Great. our positioned thank I want take and I couldn't to support about for

stay please that our for day. the call safe, ends So and

Operator

Thank you. the That concludes now call everyone.

now You disconnect. may

Shutterstock (SSTK) 28 Jul 202020 Q2 Earnings call transcript