KERN - Earnings call transcript Q3 2020 | Gryphon Digital Mining, Inc.

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Operator

Good morning and welcome to Akerna’s Third quarter Fiscal Year 2020 Financial Results Conference Call. Today's call is being recorded. All lines have been placed on mute. [Operator Instructions]

At this time, I would like to turn the conference over to Jason Assad with Akerna for introduction and the reading of the Safe Harbor statement. sir. ahead, go Please

Jason Assad

Both welcome Representing third Jessica the and of of of and during for XXXX Q&A the Billingsley, fiscal conference Akerna; portion Akerna. CFO Fowle, call. company call. John be to you available quarter questions today’s today's year CEO will Thank today is

the call, of remarks, statements be will made United are forward-looking our Before to Securities Act everyone statements we formal Litigation begin Provisions that of certain remind the Safe meaning States Private XXXX. of within like the I’d during Harbor this conference Reform that

forecasts, Words future, intends, statements. such intended as these or estimates, projected, variations such and versions seeks, expects, words should, are anticipates, words will, negative identify similar expressions expressions, plans, the to may, forward-looking of or believes, propose, of or

of cause are and filings outcomes uncertainties, results risks, are future conditions statements with and several risk in These could and Commission. or assumptions, to the more involve the materially forward-looking those not fully factors which Exchange Akerna’s results, actual known discussed factors, performance, discussed and These in from forward-looking unknown statements. differ Securities or other important guarantees

forward-looking result obligations or of statements Akerna whether no Forward-looking they revise as required to except statements, otherwise, of a any are update as day as new undertakes information, or events, made. speak the only future law. by

Jessica? quarter results. Akerna’s Billingsley for Jessica financial CEO, more to to of Now, over like discussion company’s call I'd third the turn in-depth

Jessica Billingsley

year welcome earnings Thanks our Jason call. and good fiscal you us everyone. morning XXXX to joining Thank third quarter for and

the we the cannabis a of to recession-resilient serve. few on our touching Before results, clients we and I spend discussion the go nature industry of like into minutes a would

ourselves exception, cannabis country our challenging within and one during Massachusetts; protect communities. all we seen nearly these in work state to We've declare every times as essential notable

cannabis hemp spending is tracking the Our at recreational team analyzing a with XX% encouraging, we pandemic. is ticket What see platform industry size. cannabis, our data been during has CBD year-over-year increase and in work, insights and hard up trends

as As the XX% method industry evolves increasing, is to of pickup now for meet and needs, sales. total a fulfillment product client accounts

we And the technology I provide business about of serve. industry management, solutions the indicators is agree around everything the strength speaking we Clients data-driven the ordering. the these future industry, health making insights to and industry and using strong working. our to to our and to business intelligence clients of think long-term cannabis to strategy can run decision inventory from are rates are drive

challenging this those Beyond the cannabis extremely time of an for on is, the particularly the industry, crisis. frontlines we what recognize

are thoughts most affected. Our with all of those

As I say this we'll Akerna together. to through at team get week, each our

we quarter discussed we second growing maintained can our I operational have our call, tell traction. On our you momentum.

operators. market for the Before and in response was industry the pandemic, disruptive to valuations consolidation rebalancing

financing with Even merger and last positive global industry these what to for look rethink for solutions to models, the consumer months, operators our over market alternative is find evolve continues a Despite and business options. growing cannabis-related this momentum, to have challenges, synergies, some declined explore companies leading XX valuations demands.

strategic leading for long-term the in confident provider strategy. As competitive industry, solution our positioning technology are we the and

Our to technology and to the operations solutions the comprehensive integrated suite their profitability. increase business provides cloud-based of scale software intelligence operators

CRM applications, embed ecommerce, and integrations developing to We have into and designed collection solutions are ERP, invested solutions. our including in maintaining accounting, extensive of business pre-built that an leading

platform range value a extend that infrastructure business leverage We with of applications our ecosystem. our integrated the Maintaining competitive have pre-built a integrations moat. XX and over currently broad of products provides

products. We of of have partnership best strategic dozen with agreements the over integrated a these

increasing by and more revenue seeking opportunities. business ecosystem the one emerging from our software exposure potential base can expand expanding cannabis our integrations that strong offer solutions existing enterprise our cross-sell in we which among client new quarter as for third client the by foundation Overall, companies, base, and future solidified to be described with to relationships applications, our and clients, growth continuing

As and providing ability automated to an further to with processes clients' transact. systems, solutions in solution central our business them our become technology their embedded

future. are We well-positioned for the

competitive focus productive to and areas client long-term Our relationships. strengths continue strategic will drive

revenue briefly results. leading let on a revenues me platform Now, growth. of XX%; comment pleased to the our strong year-over-year financial increased third indicator our report I'm future quarter XXX%, consulting increased

XX% increased year-over-year. revenue Software

revenue bookings revenue in related were go due of advance licensing delays strong to Continued and by delays recognition COVID-XX live. suspended offset to and

majority completed improved in gaining an one-time and are share continue with profile. costs us. investments The of associated driving behind are margin acquisitions We the industry platform the strategic

the We and shortly. infrastructure will performance scale. CFO of take efficiencies Fowle, continue to details will through of us financial our achieving focus our John our on

As our chain hemp clients, by can cannabis from industries supply and growing benefit more and technology accountability. on how evidenced CBD transparency delivers

third we in the signed a quarter, In client. fact, traditional agricultural

focus on are the which rapid markets, we traditional phase and will hemp we opportunity While significant, recognize in the cannabis to agriculture in of growth. continue CBD is a

We will as serve clients traditional explore agricultural arise. to opportunities they

software Over the for market cannabis products the our few potential $X years, to has next billion. grow alone opportunity the to over

small are opportunity, this only overall market a we the and fraction we tech to scaled market leader providers of the While are still the space.

lead that believe data-driven requiring simply among the and decisions we But scaling, adoption spreadsheets. spreadsheets remains competition technology rapid support. cannot cannabis accelerated will consolidation to primary of of use Akerna's operators

the stated our our share overall creation but continues strategy seek our To mind, highly acquisition on opportunities. this be growing to for shift, the not to in in market ready involves of this position organic us focus complementary only to previously value intent growth, paradigm With cannabis also a enterprise industry. our strategy aggressive capture

our initiative, on the third that acquisition. having quarter, we've acquisition executed the of announced In Trellis,

inorganic strategy Ample of take few minutes a Organics. provide on some and the to our review details growth me solo Let and status sciences, Trellis, integration

us supply clients, deliver thereby software Our client value broader inorganic of essential the and extend as a give and We to is retention. strategy across that solidification infrastructure wallet our around ecosystem, for the chain. increasing growth cannabis position technologies more the technology our share built reach supply target our chain,

Our drives and for our operators, integration, needs technology open integration of inorganic seamless provides cannabis platform architecture growth and strategy. partnerships, meeting technology evolving synergistic the

about We is each of In in of infrastructure valuations competitor. TAM target are a case, our create first becoming or three good value. technology, The our pursue channels, and one each tuck-in leverage additional product acquisition we XX announced to accreted generally into we falling public channel. company since think months, have examples acquisitions expanding

consumer sciences the extending supply solo extends brands interaction total Akerna’s reach by addressable technology throughout anti-counterfeit our and platform market authentication and chain.

government we Additionally, inexpensive, solution. tagging gained have profitable highly an

by infrastructure. We acquisition, a not of Akerna’s into solution can without contribution tuck-in home expansion product immediate from Trellis in growth California as positive was possible its offer compliance. a Akerna’s is of Trellis generating and operations that markets, compliance accessing market integration enabling cash additional flow leveraging outside

We can reporting ecosystem and intelligence access. services other also to sell clients, connected business advanced Trellis as such

now We for that MJ lightweight market down a have solution larger of benefit our robust more added becomes a feeder Platform solution.

share leading operating many software complimentary North with companies the with all market cross-selling By Organics majority platform largest the market market commanding leverage, Canada, America, our in the in is in legal position together, opportunities additional footprints, software solution. and Ample seed-to-sale us the opening a Akerna’s covers giving leading world. bringing

each acquisitions. are integration of for plan executing We the these on

internally. track complimentary to From many halfway Ample integration through Organics, choose for as time perspective, finding at and these assets close. position, us on plan been both and integrated. our Solo below it never than there can space We limited in pleased I with am our far categories. the more Sciences to capital, driving in opportunistic fully in to XXX smaller is would which what each pick to to opportunities be And players build are has access take a Trellis to are of prices be day are better our share we

here in. future cultural manner, Akerna’s, we Importantly, targeted interest collective Like To will our a were not us success. out that simply our shareholders whereby buying on buying our targets transactions Part with structured of all success are a of now contrary, in acquisition. fit. the depends acquisition vested in we at are our them

process. is executive culture to me highlight integrations. on the essential effective integration Culture focus or Let during teams

Our creation, become culture By and integration post-merger placing been creating team initiatives and has morale, to for support value a on value our useful tool emphasis tying objectives. has excitement building business. our achieving clients to culture first invaluable about

with company. we public summary, becoming have are to what achieved pleased In date. time, a it's we In short the

positioned strategically to correction, of market capitalize are on during We this period the and realignment. consolidation

scale operating Our leverage. growth and is providing

We continue to expand integrated portfolio technologies. of our

listed unique NASDAQ public growth And Our a our capital have access opportunity accretive and we software use our partnership, the public as and is acquisitions. currency company, inorganic strategy in to expanding ecosystem. to

we that government intend as Our continued a leader leadership in position. progress compliance our solidify cannabis cannabis position extend to and helps ERP and operational

financial third over to call review will that, Fowle John? results. now a our CFO, With the XXXX detailed of for turn I our John quarter

John Fowle

metrics Jessica. ended Thanks, provide business of an overview XXXX. I for key will Today, the and financial quarter March our XX, results

As discussed filed a the review results form will the detail week reminder, these in be our you further this to in we which XX-Q, filing. SEC, encourage are with

like towards marketing noted, results our we I shifts progress with our Key have clients. we and the future Jessica align our This in to throughout As foundation sales delivered made business evolved would significant market solidifying to and our growth. quarter investments that the the strategic quarter, better past team highlight. for and serve

March quarter. despite This bookings includes $X COVID-XX pandemic. the approximately AR recorded in near record We million of bookings the level new in

also our We momentum have of strong the heading our into continued demonstrates strength fiscal year industry. This quarter. pipeline a fourth

being to focused results million to applications the margin XXXX. a March, organic XX%, our human our more changes of XX% million a and financial in small and of investments resources reduce platform operating $X restructuring in executed and Strategic organization, Akerna's third-party from $X at strategy. our the inorganic annually. growth up capital The increase profile same we expect to reorganization execute helped end to in with of quarter leaner, the expenses organization we which And have technology

increased XX, increase across our in the XX%. business, product software Turning commercial growth to consulting Data business XXXX, addition System. our an March our Leaf revenue total XX, our revenue results, period period for regulatory software government or from March increase of $X.X million ended to $X.X to ended our from each of total lines, by business MJ driven million for XXXX, in financial was the The Platform achieved and $XXX,XXX

from existing subscriptions driven period increase XX, clients. for million The from primarily subscription ended for by revenue was caused includes client XX%. increases MJ to in $X.X period of volume or an XXXX, primarily March upgrades in increased or the and XX%. XXXX software revenue additional XX, of the XXX,XXX over $X from ending new driven revenue increase growth by million March revenue from new was Software $XXX,XXX Platform increase which business, in The

Systems Revenues Utah, along our which August to maintain initiatives, We increasing our helped Consistent subscription the to or Data result and ability a state commenced rate to XXXX. primarily a revenue. with continue in client from growth $XXX,XXX XX%, a attrition consistent variety of attrition by increased prior of compared our adoption role of invest our in contract in periods. with play have in programs keep Leaf which rates

which for them includes professional maintain driven period revenue, business business XXX,XXX, XXXX, XXXX. to engagement, consulting compared state compliance with continue to services result ended or as was increased help a from generated increase in to we XX, to revenue XXX,XXX state. XXX% of emerging Consulting higher to period demand and ended consulting operations new clients volume of March for services activities delivered the The March expand the initiate in approximately existing experience approximately an XX, strong law, by

highly are services correlated Consulting other legalization activity. expansion and regulatory to state

recent is period revenue variability of changes. As may over indicator experience a timing platform comparisons a Consulting depending legislative of on future result, period strong individual growth. leading the

of costs of period result Our to a was the XXXX an quarter XXX,XXX to ended the compared period revenue contract for or of $X.X Utah. costs with was of XX, $X.X ended increase cost XX%, to for of incurred The state revenue the service the primarily the the increase million. March of as March compared million, new XX, XXXX year's the prior

due to volume. primarily hosting have costs higher Software increased transaction

platform scale drive ongoing to We to our in reduce will costs. infrastructure invest continue and

profit or Gross March quarter for to March to the quarter increased compared ended XX, million XXX,XXX XXXX, XXXX. ended the approximately of XX, approximately an XX% $X.X increase

of XXXX, the of primarily to March quarter an the Gross profit revenue ended XX, and result The cost for infrastructure service increased XX% increase marginal minimal XX, to XXXX. increase March reduce points of ended percentage increased to margin ongoing compared software four a that costs. and revenue was investments quarter then

an quarter ended XXXX, or million, was expenses, XXX%. XX, and selling, $X.X general $X.X million for of Operating in March XX, $X.X XXXX. ended million expenses by the increase March administrative quarter expenses operating compared were for the increase to higher driven The

higher to an In of increase addition expenses, XX%. product XXX,XXX or development

were expenses time They the costs in costs the million first period by a acquisition related operating one-time Our or XXXX. number following to of of impacted costs. include $X.X compared same

behind noted, largely related $X technology Jessica integration, $XXX,XXX with position investments as expenses to sell public these cost are the and appliances. us, compensation, as growth related move costs and As operating to in related stock for and ourselves and to we a $XXX,XXX to company. other new forward infrastructure of million

focus infrastructure continue scale of efficiencies our to on achieving We will as and continue we to grow.

March XXXX. $X.X period net loss approximately to loss the million for for approximately period XX, March million ended Akerna a net of $X.X incurred a compared of XXXX, ended XX, the

unrestricted on strategy, well execute access million XX, on a significant As is of which market $XX.X the of of to our many key had positions capital cash cash, as and our advantage over XXXX, competitors. March hand we to

We our continue performance, expect as continued we scale towards improvements and to financial profitability. in drive

This our prepared concludes remarks.

questions looking to disclaimer statement the will Please of discussed We Q&A beginning at happy keep any this you to applies be have. the session. call in that may equally mind forward the take

Operator, the line. please phone open

Operator

conducting Thank you. we'll a session. At be this Instructions] [Operator time, question-and-answer

Your Alliance question. with proceed with line comes Global Please first Brian from Partners. your Kinstlinger question of

Brian Kinstlinger

thanks guys, my morning. Hi, taking questions. Good for

Jessica Billingsley

Brian. morning, Good

Brian Kinstlinger

Hi, Jessica. how I'm change curious your COVID-XX business.

highlight how well? as is the And benefiting that can company a company then you it's challenges maybe Specifically, as biggest the you other your on side, maybe facing.

Jessica Billingsley

timely. certainly Sure. great and question, It's a

well for tech are remotely work company, positioned years. a we we past then for, many, effectively could the step And to work many anywhere. As

and company from home to a our internal And of a from time. pivot culture a focusing during able initiatives So not on impact, to team our it course, had impact has supporting we've we immediately. on tremendous work company, number of were really this had

and while cannabis move to be we find flip certainly forward. as incredibly seen promising the side, we've being recession the encouraging On I which industry resilient, as

recognition noted in prepared remarks, suspensions, forward. delays we expect and we to We to our and that revenue COVID-XX. due revenue recognize moving in As seen have some do -- don't delays

delays taking side clients, also to support platform least this them with down decisions. on clients But during make benefit been to time. help during on have we some relationships in different working seen our double this and existing really opportunity help this on them We've to insights focusing with smarter at business our leveraging our the really time ways

we focus And normalized back this of as will on remembered thinking about relationship relationship time as more focus into as well. a operation on and we move that -- well a that as be mode

Brian Kinstlinger

as mainly not to it opening result you there stores Great. that able accelerate. Labs. bookings difficulties and have challenges Have as encouraging quickly bookings if then PAX And trended? and early April to am then see been momentum I was maybe are been right how And was the as continue the Or more in that May? curious, now? our of

Jessica Billingsley

encouraged those related platform. to insights. seen first, they were have really platforms at strong we continued that that just see previously, to Labs, in have scenario, and first this PAX to higher some potentially, strong our Cornerstone MJ MJ through a May get continued we're bookings to have BXB question, And bookings April for part of even your we impact during product apart been the not accounts nice really bookings seen non-COVID or might and continued demand and from time. anecdotally, could the So for announced

or we any at results uncertain business But lost have I seen And all have had seen out opportunities go least delays. pipeline as an anecdotally had as not, push of any clients we've of we well, mentioned, some pandemic. as business we out some

Brian Kinstlinger

to an fast, to on past, maybe are cannabis And a that's to then your haven't maybe as the solo your specifically And require the more COVID-XX, Great. sciences in update sales talk also furthermore, rest you so And revenue more maybe technology. your and with maybe plan been of demonstration? growing it to? about tie which tied is speaks

Jessica Billingsley

do --? you John, want to

John Fowle

restate again, could that have so maybe, question apologies, a one. I I just you take context? better could the Brian, Yes. can

Brian Kinstlinger

I Yes, way your that solo and terms customer's curious sciences, more in Yes. your believe yourself cannabis. they're enjoying I with in mean, I'm of tie towards the it's to growth

for So curious signs any the there maybe I'm is Is being that. how impacted? technology, curious, that there solo demonstration does early in that's that's how customers, just of that's any person at for that not demonstration happening? And sciences, needed needed all I'm it's

John Fowle

break let's that the two parts. So -- into two into

I question. think first your to answer

solo quarter, past pre pipeline of that with to acquired We continue see were past first see business. We the they you -- know, momentum our booked quarter. revenue we sciences, sciences We're grow. this some for to revenue when solo of we interest continuing this

and sectors get both platform In insights are and in the certainly technology to and some is technology the we fact, non-cannabis cannabis of unique that highly valuable. their

interest are we So the seeing grow.

seeing mean, come phase. ready are go still more was more pre-revenue as that again, go get to We a to to we to I highlighting and that really our market. business and in RFPs we're market this business,

So the has has reception from great. I it our been strong. overall think, community And been

person capacity value as of settings, really remote and with we're of into use so as work and demonstration, able you and and the doing the to in the forth. technology work been world, demonstrate we're so in like know, so just technology rest we've far, so happy the technology a And remote and of the pivot far the

in us impacted hasn't it So that regard. significantly really

Brian Kinstlinger

first Leaf the Systems. Two for Great. one more, RFPs Data is on

for forward the of past, state's about about they're they're operators. options. with close. happy Maybe talked some or first we've the not in thinking moving think their I Maybe the their time

or options? to getting evaluate with moving given the about their right now, their forward maybe talk our maybe state's are environment those delayed current So plans

Jessica Billingsley

great question. a That's

focusing service delays states seeing some We in RFPs and near-term on initiatives. are uncertain

However, the resilient I encouraged how by and we're am consumption be. very cannabis trends is that certainly recession to proven seeing,

inquiries that new some are states and looking at cannabis they're that looking new we've tax have that from And at states creation the also revenue. that and job received programs in inbound of place

create Great we tax change believe of a and will as alcohol initiatives, to jobs that, governments the will more saw legalization this see and personally meaningful different see we I generate And very we movement strong economic a legislative prohibition the cannabis challenging much around time like around as toward a during and some time. many at revenue way look Recession,

Brian Kinstlinger

Thanks. Great.

mentioned was Freeway flat so the pretty Lastly, Thanks for your can you all churn for it quantify questions. especially much you MJ business. your

Jessica Billingsley

I Can missed part. all you that quantify very right. first

Brian Kinstlinger

Yes.

Just I a basis that have you there annual think -- a it? provide? how can attrition. Sorry. curious curious that churn, -- call quantify -- percentage you I'm it on you can you do an just how Is rough

John Fowle

I Brian. that take question,

shared GAAP As with intend this to we've roll of fully we include And out XX-K non coming the traditional SAS investors metrics. that year, with before, are the coming track. -- to our that looking metrics a lot will this our our

our don't readily -- the point has non-retail have important different a I respects, that I out have today. because -- would is than one that to And we metrics, available -- don't in and the two But retail obviously, so retail thing is clients. think very at non-retail we non-retail profile turn look

what consistent business. is we're seeing will, today churn our consistent and attrition, if And you in so

look maintain is to to any course, SAS Of that. business going

across consistent attrition the Board. rates So the we're seeing

or that investors to that the of expect the not certainly we more metrics our non-GAAP forward, regard. for decline to on improve look want seeing track. with be, more we But include that that, going rollout that XX-K in or we we're to improve looking of I of think course, our to are going think then focused and we're as any

Brian Kinstlinger

much. so Thanks Great.

Operator

your comes Capital. of with with next from question. question Fortune Scott Please Your ROTH line proceed

Scott Fortune

to thank and how state call. Leaf side follow-up the new your for can state and the to announced with things, on the time side of that things you morning, metric or of Real in platform? integrate on you’ve in strategy Good that quick the with the Leaf Data on follow-up helps a you

Jessica Billingsley

Sure. take to that I'm Thanks. Good morning. one. Scott, happy

offers different we've -- offer some are that of -- So there Leaf lines product that compliance. type cannabis two Data

MJ distributors be cultivators, track a We the the And compliance to referenced maintain government metric report and in up to system, contracts. be other which where used trace retailers which is platform, the our products operators, might Data metrics has have contract. you case and Leaf have to by manufacturers, is and might compliance state as states, where state in product we states the then that the that Systems, other it

level them believe state our and for is it well it cannabis MJ just it currently answer where our for integration product the means of transfer for we MJ seamlessly more are suites, at I allows trace the available or clients as and a your level deeper to this well? is Trellis have metric we that and in and track entry integration platform offer integrate more really business states what the we And compliance only as the Trellis that metric integration operator announced, to at both is eliminates platform question Does double system. that

Scott Fortune

that's Yes. is for on what those because a of with adding side. I'm MJ states, getting people that number has metric from states at And fair platform beneficial

as a into beneficial because platform of You [Indiscernible]. to new cultivate your the operators see

Jessica Billingsley

and wonderful BXB not product. does It's Absolutely. advantage a have metric competitive

of competitive the integration announce. is else and and than metric a where states a strong competitive very in state advantage to advantage pleased we system, were better anyone is that having one having So tighter

Scott Fortune

option at new being timeline that of in data future? you business? you've there platform numbers than thanks. stated, And terms or How of a and near we follow-up and a the a February, then the is for roadmap that How the then have opportunities Okay, a higher saw so kind have as of data in January nice looking since of around are in and collection, monetizing very stockpiling you lot resilient. normalized

Jessica Billingsley

our business announced, reference First, in we believe that our cornerstone a analytics January, a client Labs for product. as We Pax product. client slide I cornerstone ago, bit announced for

our expect don't revenue their but that ensuring to a fiscal intention to as cornerstone this revenue. intelligence We're it do that to is accounts So first see and product we're We from on focusing product. we business from expect significant next in needs that our fiscal our there really generate year and revenue those significant meeting year. certainly in see monitor well,

Scott Fortune

for million million then Board the expenses And reduce John, those annually? $X little $X kind cuts you kind of on a to a across Can provide you probably of Okay. savings? to of and follow-up implemented question more color the the reorg timing a

John Fowle

Sure.

maybe of So talk The together at took end place March. put we the first. timing reorg

so those And we and go the quarter expect cost current to some start of those savings forward. expect -- we here in materializing

we a course looked, opportunities emerging redundancy growth As reorg, thought streamline, still we as curve. of company, to the through we an about of growth we're it's did certainly that where lot and working have

And just across saw a so business. we lot the

to condense looking duplicative focusing as operations, I on of vendors some highlighted externally course, combine third-party Some and certainly reduce, my just resources, prepared opportunities and in remarks.

the and improve some made or that activities helped other marketing group. gross gained platform and sales the of changes efficiencies and infrastructure margin in some marketing on type sales other We we

So it little really a a focus leaner, key more wasn't an some tighten focused to bit was any and just a get one just little more, little the particular belt maybe in one opportunity areas. it a particular little area, area,

Scott Fortune

Okay.

John Fowle

always most but to it letting guys the growth you will And you’re you mean, cover, help these positive EBITDA line -- standpoint drive have for with today, right to -- you the that now, that's you flow as wait opportunities you get EBITDA thing from an to I weighing quicker overall. basis obviously, the acquisition important thank

Scott Fortune

for jump in it me. queue. That's back Okay. the I'll

John Fowle

you. Okay. Thank

Jessica Billingsley

Thank you.

Operator

comes question Please your line Gerald with with proceed Pascarelli Cowen. next The question. from of

Gerald Pascarelli

good Thanks questions. Hi, for morning. the very taking much

Jessica Billingsley

Gerald. Good morning,

Gerald Pascarelli

So Jessica. morning, -- good

pointed analytics, March from spoke obviously, to off-premise load of in that seeing alcoholic you within pantry trends the end industry the the time perspective, last been So similar at your an beverages. we've channel to

there's April, I my the kind get questions seeing in in form a you're change That you. guess of your to high of and some March? within the terms if helpful. of end outperform color we're load? to which like will cannabis And then through that since sustainability level thoughts what on factors the be any of continue been would love now So Thank particular

Jessica Billingsley

question. Thanks. Good Sure.

head of as much of So the the tax I'll release Akerna’s weekly course, top we update categories. off things continue where like answer my and on can we mix report as do to I between

you're So, sign -- up of those. and line, to to those, not Akerna’s the course, following please if receive website and our on such anyone

compared $XXX. method we COVID of curbside seeing during for continued seen there strong, through an many was strong we Nevada's have for allowed impact of where across our negative they of now just Nevada's curbside So to see Nevada following We markets Nevada, among recently most for buying across may our saw an as governor recently some where of impact and markets. markets all our increased fulfillment certainly from size positive just at and was we outlier a impact. allow which -- were a a sales a and with XX% ticket average

seen challenge this asking We've that a see in also is to you're economic something would we different about mix, expect as product and the the categories time.

seen product of mix that products. flower period the maintain whole shift time. this we've have more net cost We lower towards And and a throughout towards seen bit

trend also in Of during more but gaining this course, a concentrate share, long-term seen there's of of been in and time, period increasing flower. an we've uptick

Gerald Pascarelli

That's in the over very And least active your front. COVID-XX near-term Thanks. you of strategy? light Thank obviously that. just the you overall how guess changes, allocation for I guys that very at to, M&A My pandemic? potentially on And can the capital next question, been you have helpful color. speak

Jessica Billingsley

John. that Sure, you one? take Can

John Fowle

Yes, I'll take question. Great one. that

optimize are strength going is at do through the we're of best access that, in that mindful and our platforms? our capital, in decisions we of it's And deploy means, have great and be, restated through as inorganic capital question. to very be your you creative as to they've very most these we're on been data which prepare, so So is different we're transactions again, the valuation our deliver the very remarks from is it and for course, we an and at the sure or our do option favor. allocate times, -- for of for made how is we well of. we've our so a continues it resources it, manner look shareholder that a to in ways to allocation make. then historically we've always financial about we high an through previously, are currency pursue development do base, capital always we're to a expanding, as access the our look we're going mindful capital we from our to going making unique And and certainly current to and where our ROI. is to whether that's a and transactions M&A the or to sheet very and structured us mindful level, structure always, far they something capital today or And yes, means, capital, to so prepared we balance they comments bXb So, perspective, you that it's But yet certainly

Gerald Pascarelli

Thanks helpful. be it Super much. very into queue. I'll now. back for That's the

Jessica Billingsley

Assad?

Operator

question. NCV next Brochstein Alan Instructions] Media. Your question [Operator your of with with comes Please from proceed line

Alan Brochstein

Hey, appreciate. be good on to to… I call. I wanted the

Jessica Billingsley

Alan. morning, Good

Alan Brochstein

Trellis obviously, originally said you've was and there transactions third there You've that just potential if was the verify, want I to announced indeed three acquisition?

Jessica Billingsley

three announced three previously we had transactions. now have we disclosed So LOI’s and

I I'm answering think your So question.

Alan Brochstein

to three-for-three, wasn’t mix. Trellis three. all the close -- wasn't it you Did It was moved

Jessica Billingsley

We close three-for-three.

Alan Brochstein

three been know but you this the very numbers, I that around yours to tough, given you're right that give recently, new little -- quarters. your and fourth us not a seasonality? for time. Is in which color like year Can has is a often seasonality there now, have necessarily guidance, for relative a long question but quarter, next my is then relatively Jessica? Companies strong you're other so on in And looking Okay. business will

Jessica Billingsley

recognition So, moving I'll shows and the And take cannabis the good keep generally BXB you it historically, often head full But seasonality a necessarily that periods to both for that to at for bookings historically perspective. think that time then cannabis. just the expect it translate us that We can in experience springs I'll to to see from doesn't I'll been booking, Alan, in what have that we great seasonality in a market. your share And is I busy briefly. revenue into to John certainly that to see really share very deep forward. interesting, a throw anecdotally I time then fit given it especially is John, do question quarter. time to period

would very is calendar as look be end often coming quarter, as or a the on any Xst for new to normal system of fourth we the start quarter As change have many and a a you and in software strong this -- the very mentioned calendar year. January system businesses year, toward would business, for

booking. from expectations a strong this bit John, revenue bookings to So just bookings I month-over-month tremendous see necessarily between are those are without anecdotally, color don't of two do But from sharing because those a those impact to a those that we forward? just profile a historic to months. are there recognition want any nice speak we little seasonality, of we and times year around really you bit be moving variability said a some of that are do seem have ton

John Fowle

I'll touch on Yes, briefly. that

about I comments, when think think expanding I on much it of those as business, of see I think. I don't think the seasonality some as I

I are to driven think, legislative by more our results changes. impact financial

states and of to state really their of time, in here open-up onboard open-up to see that. I've we their Just the come brief some when That's -- been legalization. form the see impact new

we impact numbers of our I systems certainly just to with timing of to a Jessica go back to don't as some I to and I tie well, too have an services. that can due more changes of and regards legislative with lead our financial seasonality. and don't see the as share we data impact So like nature as said, much it products

As we shared, we're we our out. a far attrition focus as and like good expectations, and booking churn going driving to on number reported and

year. really so it look don't I that at effect our going on think business throughout the seasonality And has more forward. much holistically We

Alan Brochstein

see was share That's a the and this the I filing, what you business also, the of platform, I Can trying you your geographies? party think what it's I other address breakdown your reports, apologize those last real see you would I third guys what are about but say. any very if sorry, you be then shares if is and in talking market in your in this year? is in of overall fragmented issues when guessing but market Colorado, I'm maybe market might MJ terms overall not, materials both question certainly in I'm share a of and if And address am heavy to could industry. Okay. don't I geographical exposing be

Jessica Billingsley

which generally And I'm to great reports that the a question. Sure, I'm one. happy think, some retail and a generally only portion seeing interesting have you business. are reported on to self-survey speak It's focused of I

the So into often which of not course supply serve. those account we chain, numbers taking full are

at our to countries in number determine it's others, do share, published of some And licenses we we at, extrapolation market licenses in look available look so a and of and in to market. given some published number when the states some not have and what we in the markets is

those we So our of majority is you is. leading in can determine supply we market acquisition what North share which look our actually see to we market at with numbers certainly across leading whole and are Organics and America, then looked in tell Ample footprints of how share our see when American North Canada and the has many and market in commanding what operational at look you we that numbers our I that chain. share

thing licenses, we to other of our market. is the will is the just we at of tend serve so volume look the capture And mention we not at internally what business also would given also of of -- I the and a that look more also look is tiers but we our at number what only enterprise capture will that, in on of that

The In market generally, Pennsylvania both of we the Utah other licenses. MJ number we states, and of share the XXX% do probably and of contracts, course, have have in some than in states of others systems data where internally and use where little state we're a course platform mandates. stronger we generally track

have have For compared licensing. a of some instance, California limited in with numbers a licenses licenses. state of that of going lot California a states high We're number other to is to

Alan Brochstein

Colorado you your much can in business of weigh might think be specifically, ballpark? how Colorado I on

Jessica Billingsley

operators. I We among don't that But enterprise of have share can that published. the tier

great market of a really including clients with Colorado long couple Cornerstone have in have clients been us share and that and We for very time. a

and the getting at industry clients very earliest first to have started days back in XXXX. we back when We the

Alan Brochstein

that of actual question. same brings to part And the Okay.

investors, it. I like lot for it's your maybe investors. opportunity although to it's don't you say, pick when to you now I winners company, I would when disclose or talk to difficult the And your define a are are know you ahead with, about where to easier So comes large of people it getting the how able

Let's at says you you say of ranking outside fully you and New by terms revenue. Colorado? kind penetrated describe, half of penetrated the top-end the look Can have large Ventures at in do yourself see Cannabis a it's look where that kind the or of enterprises of

Jessica Billingsley

good Sure. Very Okay. question.

are signed, out which planning. tax half for MSOs we've there of integration much still them we And locations, look all very of few as the and and are process. largest that partners, with we at across fully and the our rolled of course although, all announced that are MSOs, a in Sage we others some accounting in So have we've installed set half,

NetSuite. integration a also have NetSuite We with and strategic with partnership

MSO accounts. And Cornerstone are certainly, those integrations

solve to focused fiscal expect really advanced when planning and compelling integrations, tax see no tries pieces of drive competitive business, all that ensuring the see that completing that year to global those a we that reinvent and the expect next those integrations to one already currency on revenue and wheel as including we significant for we For in differentiator conversions, financials.

Alan Brochstein

and year. the wrap-up color best Great. you you as this wish I really appreciate the

Jessica Billingsley

to so laser of room focused Wonderful. so Thank we're much. and always course, and grow Thanks much there's execution. on you

Alan Brochstein

All right.

Operator

we turn the question-and-answer to Billingsley like to end comments. Ladies the reached have and session Jessica I back for of call and would gentlemen, the closing

Jessica Billingsley

you, operator. Thank

say product create creators and We to we do consumers. product to we're continue going We do. what between trust

and and consumers with on and government. the Our up demand for end the cannabis technology, investments focused are the solving among text supply of locking businesses acquisitions enterprise increased transparency strategic chain growing

greatest continued support. execute. to sharing continue look to us on ahead. We just you depend We our opportunities to believe with can future. in you the lie for continuing progress forward You your our Thank

Operator

This Thank have concludes a great conference and day. Akerna's call. you

Gryphon Digital Mining (GRYP) 13 May 202020 Q3 Earnings call transcript