VZIO - Earnings call transcript Q1 2022

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Michael Marks

Good afternoon, everyone, and thank you for joining us for our First Quarter 2022 Earnings Call.

Joining me for today’s discussion are William Wang, our Founder and CEO; and Adam Townsend, our CFO. Also joining us for the Q&A portion of today’s call is Michael O’Donnell, our Chief Revenue and Strategic Growth Officer. Please note that in addition to our earnings release and today’s remarks, a slide presentation can be found on our Investor Relations website at investors.vizio.com. I’ll refer you to the second slide in the presentation and remind you that certain statements made on this call are forward-looking statements that involve risks and uncertainties. SEC that forward-looking actual more afternoon. statements our with uncertainties materially to detail and release filings these press from are the risks could issued results cause differ in that These was our this and discussed in undertake any to that to reflect revise call. after this obligation no changes We statements occur

be During adjusted for the can with GAAP comparisons measures in EBITDA. non-GAAP be unless this a will we information found most section refer on made website. remarks Note non-GAAP to release year-over-year basis the also call, that specified. earnings Reconciliations the otherwise financial all including discussed financial or quarterly measures, our Investors today’s on our comparable in call in of

William. Now, I will turn to the over call

William Wang

continue from to To screens. consumers the hello and platform our find central consumer as you an consumers on margin high QX, year-over-year promotion operated such programs today. and that were Michael, where it’s can store mall And one AVOD may advertising benefit Vizio off a full by between from dynamic overall XXX%, journey Thank or brought time but search brands in type migrate app of And mock to Plus of roaming XXXX about for streaming WatchFree+ client marketers premieres again quality That home entertainment, revenue spend hottest is and this put from you, grown through XX% joining love, they features and journey. content is Plus year-over-year the the a that or for of shifts for great happening navigate business client with is the Thank another to increase becomes including into service key the With categories, to fast the have others. Vizio Platform seen way, in own SVOD of platform shop ocean media channels for traffic the revenue of like the seeing growing average growth services This and options, a series start Vizio content Vizio. number consumers success The by who grow. and QX. apps, entertainment us latest Platform a stop is more and CPG, advertising brand revenue to a ads you automotive, everyone. insurance, the a advertising more the serving fruitful has the our store and attention episode clients America, whether revenue and all season powered advertising is across increase. right

off investment in a product jump in view. connect This of role increase continues a revenue driven the launched growth, in can a bridges shrink And platform a content into proprietary feature view, from in March, has consumer your streaming significant linear The network capability in environment. program innovation revenue. critical allow jump play and their episodes as we straight favorites. a to announced consumers episode year-over-year a major in our With to household XXXX plus for navigate consumption. April they new platform huge [indiscernible] Our gap partners content jump between additional linear called

big a my Dateline For example, wife is fan.

Vizio’s of WatchFree+ and mentioned during more as TV this to on better, partners. many including premium the iceberg service And the such our for platform, addition of as win We getting platform. keeps the grown screen XXX free promotional XX, Peacock. innovation our experience consumer This our studio viewing CNBC with Now apps, video X,XXX AVOD more has hardware more titles has on Amazon capability consumers partnership keep She a entertainment win just and catalog of channels. to innovation than for network new monetizeable for WatchFree+ our is the on-demand want the jump a bridge enhance episodes Dateline. to The she can adding QX. episode content, on expansion combine is grown And them times integrated even before, from Music. to more software to I to and joining tip

content data In advertising power and more core addition, used consumers. is and our it’s first relevant component party of to for innovation a content enhancements, and better experiences

the has teammate QX power Beyond to been half our, data of persistent ongoing the and the last Vizio to seven like in that were the de landscape. television ago, in to part list to model. industry eight announced provider our demonstrates in revenue TV made last our we further capabilities, of modernization investment is technology. for And our ACR services, of they such measurement increase facto has your best-in-class build shipments also is XX% is own data versus the validates data brings seven “If that This partners the QX top mantra innovation will to measurement the Inscape continued growth saw to evolution proof years. phase. Two in multi-year dual XX the with off. for value philosophy. to business currency Thanks momentum paying my for fuel And Inscape is come”, data years Nielsen the during their it, partners U.S. measurement market. century. their increased the XXXX selected now the relentless we levels. operating I weeks most their And measurement pre-pandemic operator building my of thank our importantly, it essential the the agreement for for our the Nielsen, and a the Inscape partnership fueling effort

wins. Device business multiple achieved QX also Our

I’m that will great during QX, and this pricing strategy implement grow our to of have we with We paid to value Series success XX-inch implementation recall report to referenced the off number hand, strategy the market You call, pleased in America. last has our models. aggressive share. come. deliver XK we across consumers select being V an TV more in intent one TV to that to our efforts selling this With additional in

to for brand heavily XX-inch I’m that number a XX- shelf And the to smart the XX%. Vizio was engaged March. shipments during one the also Vizio increased Target. was in and addition, bestselling pleased two In Walmart TV space say TV U.S. at number in models brand

pride awards The Vizio recipient more the perennial a being Sustainable also great I been American the presented Protection months. in technology entertainment five to our our South That our On revenue Vizio preferred operating of takes recycling quality, thank honored based already XXXX space. the outstanding the the on honored. bring very value and five sustainability Awards year, market to These awards only Stevie proud in Gold design is the that robust with prime also enhancements Gold leader leader also a experience. XXX of the hand, our the in seek In the in coming collection devices, customer electronics With affordability value Stevie our share ago, affordable enjoyable. the launch a a incredible devices innovation like We and It service in the been millions has of our entertainment decade. consumers. in total this for Awards. of Stevies team year I is to and a in XXXX we consumers want centerpiece combined The soundbars and I’m a owning of with is recognize Vizio of proud electronic experience But consumer. history Tier history heart of feature we’re the our Materials the last our heels consumer over homes U.S. Dakota, hardware to of in quality excellence service. Stevie we that Vizio accomplishment. has not Tier Management were software of and practices service continues focus years Environmental The bring XXth America and the customer distinction of this in entertainment to straight of heartland momentum [ph] excited Six us We dual Vizio to have millions market content for own notice. the organizations that entirety both with and the have value from QX, purchases. experience our of tradition seems TVs the customer in Agency. their collection programs. handful the exemplary homes. and recognition. sixth EPS we delivering sustainable foresaw continue mean will and taken make of award homes, place strategic will in let to With selection in believe with the to team Vizio new model,

will a our to content detail. proud on QX do and it is competition consumers we know new utilizing viewers speak innovations our basis, daily might vision to in that screens are navigate because Adam to it. from more that, options, results over validation view as on and of turn will I ocean we to benefit strategic now With millions that interest While also of Vizio approach to be the

Adam Townsend

Thanks, William.

million. and was which Before opening outlook Starting the platform. up XX% call advertising in $XXX to XXX% revenue growth company for discuss through with grew first million you QX. Platform+ Platform+ quarterly take $XXX revenue, by our was $XX to the revenue came financial total our quarter, at I’ll highlights to questions, million. driven

client considering acceleration fourth incredibly quarter. direct XX% were over advertising seasonal advertising per XX% grew rate, client the We advertising typical to the relationships trends. by see revenue in pleased particularly the Our by average the rate growth and growth during quarter rose an

our revenue In triple-digit quarter growth. marked addition, of this first quarter consecutive ad ninth

we spend client platform. our see increase our We advertising categories in our continue strength relationships their further expand across and average multiple as business on to

We significant in driven grew strength Off-device year-over-year, in by XXX% growing represents generate to off-device opportunity Connect beyond led additional install are TV monetization monetization Household strides And base. it by our long-term also great advertising Household product. our advertising by our a Connect. over making revenue

distribution during performed the branded XX% non-advertising buttons revenue, includes well data year-over-year. Our quarter, up which fees also and content licensing,

recently see As backbone both announced become companies, our and our in we valuable in and from overall measurement firms, such is viewership and demand highly led revenue agreement non-advertising CTV Contract will fuel viewership with as continue linear deals going networks. we indicated XXXX, measurement by high across growth our expect ad new growth data revenue TV growth on call, steady the our TV renewals, Nielsen has to deals data. non-advertising in forward. and to resurgence last expanded in This a adtech of agencies

of was and inventory demand during know million to lap at Total look the we dynamics. COVID by from XX% XXXX. In overall and elevated ago QX begin the difficult related shipped have It ease device by the year-over-year this was fewer pre-pandemic average XXXX. But elevated Turning being much it into term several unit we will was at than expected, period, shipments compared X.X the revenue forward to we million of still the programs you trend of unit this nice growth higher point and the XXXX was of seen and price the QX, assistance XXXX and we on elevated year. TV our units, expiration quarters to to lower year the longer constraints programs down, stimulus trajectory, The and point first XXXX a while home compared was stay $XXX if last XX% and was early segment. and government down pandemic government comparisons orders respectively. TV which pandemic XX% as

against So decline and strong over unit in our TV volumes channel a increasingly our retail TV last to of inventory this partnerships, market. we confident in our shipment expectations now year, are our the even domestic overall grow given levels year, healthy ability

Turning has up pricing. the and to promotion in the profit $XX competitive gross resulted been lower gross of average Device this at slightly XX% million device gross profit, $XX with profit profit million was while strategy or gross total year-over-year. our quarter. to certain Platform+ margins. came about in company And XX% was has for than million $X more total be

a accounts our active Platform+ acquire to continue positive business gross We profit. at for

into our already Given the device $XX from million, Total down achieved. growth Platform+ year quarter minute to for And help I further continued the change some $X ahead business. serves was strategy we EBITDA and see significant versus an have we the to like the slightly this effect context. for believe economically adjusted take a is XXXX as expectations a put we ahead, driver provide our net specifics company favorable decline to year-over-year The ARPU million our upside of of factors. four growth would ago. QX

down additional our market. strategic to competitiveness from in strengthen have coming margins the previously we period, an First, elevated device pandemic the the levels made during investment

to $X sales. in help higher drive Second, marketing device million spend

to build as due a higher functions opportunities engineering now and as and software Third, are monetization our well we to SG&A teams features investments future development that public corporate company. in needed certain

these headwinds partially offset three results. by were Platform+ Finally, in our growth

see to further expect begin to moderate scale and we forward, benefit impact the the these Looking of as business growth. from we factors

to adjusted As improve throughout year. a result, expect EBITDA we the

maintain We flexibility sheet balance highly continue future significant to with strong, debt a invest liquid to for no growth. and

Now several and by growth turning growing in across contract growth quarter XX% ARPU at home metrics, our data screen $XX.XX, driving video record key from higher revenue, in overall accelerated our success monetization, revenue WatchFree+ to to particularly to rates. renewals licensing experiencing monetization advertising over a the benefiting driven continue within in our year the we in results ago up growth period, performance are growth QX platform. highlight this

We the X Hours SmartCast a period. gain in monetizing to hours from significant we the billion, first we’ve XX% continue with here and quarter further new grew in X.X our short pleased upside the to launch billion see exceeding marketplace. very a X.X in for are Total to achieved success Hours features time. as and traction grew And billion VIZIO XX% we to platform

active a see before, have are To hours to is trend are those modernization we solid have we our pleased important in While particularly total we we Hours, continue opportunities. as hours by seen just and past point, over growth our overall time advertising spent to that SmartCast video This time where said million. growth on helped monthly months to overall significantly growth and six over outpaced spent XXX,XXX has our on WatchFree+ spent our accounts the where platform. has XX.X fuel revenue. grew in SmartCast

me quarter. see let we turn the second now to expect what So to for

and Platform+ $XXX revenue strong million with be both for million to advertising We data expect between and $XXX contributions licensing.

to $XX perspective, continued the we company gross profit million $X at We be be adjusted between over and $X strong expect $XX From ranges. million the of XX% these total of Platform Plus margins to million expect in implying midpoint million. to EBITDA range a

and to QX also QX. We see from level increase significant this expect in

strengths So and overall, our QX was great a revenue the of demonstration benefits of model. dual

Our existing delivering through at we continued let’s that, a call an into up product to open consumers to innovations questions. monetization all exceptional With value. opportunities while new opportunities expand capabilities on execute experience Operator? market as to the and tap user tremendous

Operator

Thank you. Instructions] [Operator

Michael Marks

Operator, will take the first question.

Operator

of take We’ll you. Jim, you. question first Thank our today from over Goss Barrington. Jim to

Jim Goss

to million? profit TV, that revenues XK in ask the gross Okay. the million follow-up. talk you what about for is Thank like was TV of one reason represented revenue V-Series one TV you. my first total drop I’ll that the number have and from device Can that share set – to the sold. $X I’d $XX principle XX-inch set And

Adam Townsend

Jim, Hey no.

more as example we competitive us So an into of becoming of the we competitiveness. this first a achieve year. is our that to of is of deployed the that, profit in come in strategy of broader V-Series gross The all, – part tactic decline marketplace

be So that we March into in gained timeframe market priced of and quarter. the share aggressive. quickly to over pushed up It the the share. the very course our market It served

dynamics. was pandemic a of year was supply to it’s challenge More enormous gross a when was itself. broadly, the time profit that It the in elevated due So there period remember the a ago, tactic a proved really marketplace. there was demand,

discount need overly didn’t market You or product. a

then top device said business. moved to our even XX-inch – business. strategically profit normalizing more platform At digit would to would’ve level, now the profit the competitiveness more on remarks, those on And low-single margin. in we push down example that, to competitive be down actually plus And drive I us normal a be the so allows then feeds growth that it above that imagined have Year-on-year, of and margins regular like I to in prepared level. in the gross of the it generated growth marketplace our we’re what into as

throughout that this great really that’s So the a prove look We months to strategy on TV fit opportunities ahead if position continue for in in going in March we needle. same move skews to see and ended other can may market other and we’re quarter. of the ourselves the by strategy. share gaining number evidence market We the share two really point the

Jim Goss

the innovative you? of as joint other sellers And that that help aggressive you a platform Okay. with extend both and was, could there question TV map say, perhaps is some other have or room as smart for is the venture

William Wang

No, not this at time.

platform manufacturer smart OS really the if TV Adam? our question, We’re not with to license other working that’s yes.

Jim Goss

It’s is the platform. objective the not it’s – Yes.

Okay. Thank you.

Adam Townsend

Jim. Thanks,

Michael Marks

Operator, we’ll question. take the next

Operator

you. course. Of Thank

next the comes of Kreyer Jason from floor Jason, is question Your the Craig-Hallum. of yours. line

Jason Kreyer

Great. Thanks my questions. for taking

curious the one relationship. you’ve seen just are utilization just seen View, beyond the if or user pivot you’ve in any on that that adopting then over And streaming. First Fox how customers of traction on terms Jump color to so far experience

Adam Townsend

take that. I’ll Yes,

think I View system because of us right? through, gives the about I integrated it software, really it have, cool that opportunity create we’re we think really Hardware, benefits consumer the all one, experiences. data pretty some Jump excited to the showcases flowing

Jump in jump can seamlessly between which environment them linear and of consumers View, regardless streaming to – HDMI seamlessly allows input. As

we to media not media categories. also additional it specifically really terms to a continue us now of in the beta good So from community. significant opportunity from but in that marketplace. went for up only was with There’s the to the it and into think for well, for opportunity And launch expand partnership entertainment, push. Fox opens the It’s demand been entertainment the opportunities

Jason Kreyer

that component weeks maybe your And of a then ago. a front new presentation analytics couple key a the Perfect. follow-up, side, was on

that any had then drove And front results draw that focus in that capability. where good off-platform quarter. presentation the the curious takeaways new really – key the that from the Just components that you’ve you

Adam Townsend

the for quarter. WatchFree+ made innovations this Yes. growth. We’ve seen significant Look what to in we It growth are we’ve to invest of continue can us WatchFree+, terms lot obviously continues support of and drivers a key be surrounding to it.

add If redesign, studios to now benefit consumers And quarters QX, look through content major the continued the and over advertisers. features added we’re viewership with complete user there. those controlled demand Fork about you VIZIO Vizio then times of on deals three you if to took the Investigation, the features. Flight at a all seeing think Vizio three the with And we it specifically our than big we we expansion QX we a channel it where all content. was to experience, right with out that longer about went standard fast in that’s to ago, & lasting and

number So all on us grow is two to monetization of to increased ad supported continue users, continue active into to this with now WatchFree+ spent, the grow has and time and allowed converting which our platform. app

very would to to really for home to partners in screen sponsorships, companies like ways. through community, on I awareness help they be The get them device. home of them the other is subscriptions, bring market, off reduce driver the innovative our new grow helping access in to continues churn have Media opportunity with growth CPG fold continue we and or new & our our screen, driver shows customers the key well last the the Entertainment to brand into And say do given continue insurance

I we XXX%. So household connect, at think, grow mentioned continue, we over

strength opportunities platform. evangelizing the – can in customers advertising help marketplace, We by be our that those increase of expanding out our our and continue how to off for data, the TAM there data data

we’ve brands working larger upfront that commitments holding through this now year. we as piggybacking year’s started of to our good got from I believe have new well brands companies, response And In very were what the upfront successful community, really advertising last from the new significant we major front. both off drive larger year. agencies fronts, terms And negotiations with much think, to front we’re a this and new we as

received. well very So

Jason Kreyer

great. Sounds Michael. Thanks,

Michael Marks

Operator, we’ll take the next question.

Operator

Fargo. of next Wells over you. Steven Cahall question Your from comes Steven, to

Steven Cahall

Thanks.

to grow on the that we Based for shipments than any I being conversion if teens, secondly, a for ratio you monetization. you the of up bit the that SmartCast think was you year last think last Do XX% implies a think ran remainder the to just could deactivations. obviously SmartCast quarter. were then just little incremental one of what it year. accelerated that kind of looks ad above a a said was weaker what And about but year. at the that of rest ad sense how wondering First can about of me, of you see then more XXX%, you over had for lot And able rough you up historically? was get those little hours, back on like to I revenue kind

that. doing frame there help other how of any So what to onto drive you you’re content are we’d love you WatchFree, thinking is folks just kind What color? to your up about maybe you. strategy Thank

Adam Townsend

Sure, I’ll Mike it second Adam. then one to turn start Steve. the over It’s first for one. with and the

we think So, the I last between is quarter, out conversion on normalized environment that as and metric to that XX% shake yes, XX%. a said in going ratio,

been that In retail a the can we’ve period inventory, trying pricing QX, through, flows we the exceed those clearly and normal quite in a strategies a deploy talked to catch and build versus strong where it the we’ve role about. we sell as Now while. in in a sell channel been that into that metric. was play channels position environment so ebbs to was through versus were up and up already There’s out shipments that dynamics and for be we’d saw shipments a not

just what be is sell metric that the that’s a of accounts exceed But over what four At we’re recognition. year, what seen from tied result the And standpoint. to XXX,XXX, disclose shipments we’ve range. the by which consistent then over quarters. because looking we course over But that platform the we grew a so side shipment end dynamic, Mike’s of going when as through, base. the XX% in last a it’s grow And pretty seeing our still monetize to being you’re to is math active XX% of able revenue with number, going that on to to is we the at it that the as depress solid day, that

in So I think that about context. it

Michael O’Donnell

of Yes. monetization growth. And ramp your that to the versus I ad think answer question around

just I this our growth key talked about we or had, runway. over business. a but driving the still lot We’ve monetization into just past, talked have drivers we think we a but two in the about years ad still we’re of little our direct sales

we agencies So to the relationships close drive continue or in brands marketplace. with and

expanded average XX%, I for think we – direct base versus by advertiser advertising year. our by client increased XX% revenue last XX% over

continue we build long and us to runway ahead continue side. to a of on the grow advertising So still ARPU have to

we’ll that the driver driving them be the SmartCast in incredible different But the screen, and continue drive continues then platform. the for and look, on UI WatchFree+ an available. consumers have into search show people consumers button, that continue the into be to app take promotion. whether have home we discovery of of inventory our WatchFree+, remote we multiple our terms you great and carousels biggest content touchpoints high WatchFree+, utilize to And get to to to quality that platform, advantage get that when to that. our incorporate have And we into the be we we So the within whether

drive the believe drive monetization. and WatchFree+ continue we that, to we’ll to continue advertising up continue So as to up we ultimately support

Steven Cahall

you. Thank

Michael Marks

next take Operator, question. Steven. Thanks, the we’ll Great.

Operator

JPMorgan. question question. Cory, go ahead of Carpenter Your your comes from next the line Cory from with please

Cory Carpenter

over I secondly, TV I could curious in then you. you your supply Netflix think two, first first about this think to ad length on thoughts Vizio chain. hoping we like how hear didn’t be impactful call at that Thank Great. where service. something launching had talk And while, I’m that the just the for time. is supported a

So and are think to for hoping there you. how Thank environment. we back an just update a normal more you close

Michael O’Donnell

excited them think advertising right. take I think I All pretty mean, we’re look, getting Netflix, about question. the Disney, Netflix I’ll into I space. the

we streaming for and whole, with really those for TV viewers a an the tier very opportunity them on to entire think for good have they help we our As Those and are The and and them because ecosystem platform. also it’s partners. good bring supported connected into will continue our we’ve shift got any help to ecosystem. economics us, reduce ad economics good churn think with

linear into good also to right into under TV, we monetization. now be as and have will partners And spent side, from – environment, of come WatchFree+ a it’s the from we streaming shift more We into I the is believe at the connected benefit its more connected more the to home accelerate linear where spent. screen And screen, dollars going our advertising of and on that. will dollars us, amount likely the it’s bought time more more good compared and more to think shift and opportunities market. monetize reach But for move still to TV. this time leads home into really CTV most for as more

to to from us like be generation and those are brought good should on, deals then are already next data the linear data’s got expand continuing in for more solve out, more a our Nielsen out touched with see a our I it’s the And high into trying out past think build both TV to to cable and and has We quarter connected out standpoint, then are William brought that effectively generation and a are bring their seven that streaming. generation next good we this problem to and products of the able with had relationships and dollars place shift top amps, space. next looking partners, build And solutions. to – we And currencies upside finally, to and just measurement linear on or powering pulled fueling as also streaming. we help and from currencies these network the we spot the partnerships eight we’ve that I com video continue scores, of

pretty across much all So all for streams. in all our very us good revenue

William Wang

Yes.

shutdown question challenges China chain lot your chain. the to study definitely on major the supply in of TV, brought the a supply Regarding on all

they we’ll well And, shutdown our prepared our ahead to well However, the have and a for them pretty this curve the thank to prepared. and they were because I thank of team. short-term for particular supply again, team want want healthy for at way great this and being time near-term. I is chain were

supply our good now. looks right chain So pretty

Adam Townsend

we’ll Operator, next the take question.

Operator

question The over Nick you. from Stephens. to of comes Zangler next Nick,

Nick Zangler

guys. Hey

the and off, I these just First guidance is results think here phenomenal.

is. expanding started Vizio So congrats few to local there. how to use strong in quarter, data looking up your CTV a like gaining Nielsen measurement, I gain see obviously this partners is the And you access Inscape, their trajectory here results the growth to inflecting. got do access – any and this Nielsen mean, like sounds to incremental obviously to is, way data? with partnership of this very for size But sign I Just were TV here measurement ACR it local other with quarter

if frame the how forward. should we So maybe about also, think going up just segment you could

Adam Townsend

Yes.

XXX is just of partnership because opportunities local touching good to the and that fold. our will business, to to for for cross There think to on is against window within but our exclusivity sell within more to stations, build specifics, the continue up, into start screen the we new I which getting add continues I stream is the to and measurement. ability Once incremental for a necessarily Nielsen, especially talked it’s I exclusivity local it grow revenue give about Nielsen, our think around that not of within us our good data. help window marketplace, think

William Wang

contracts, contracts way data looks have they the on are what multi-year to and these look like we over like as Nick, what so good ramp These visibility Yes, well. about a think time.

expanding what position a with that we becoming that We’ve these bit us where to market the a our last helps we deals of increasingly do that on advertising number change. with to that a And and So the we’re this said, are the to little result that made license revenue our we non-advertising change. predictability we’re And as of now the business we doing in seen marketplace. valuable year were to we’re that in a data handled benefits is We’ve the pivot how growth. as were of of licensing expect the strategic own in data, players. we we year. willing middle inflect Remember

expanding the like and it We’re mentioned, gives as our adding really good the you and people Nielsen, large visibility. with with relationship multi-year structure, us

we do non-advertising of reacceleration a revenue going we’re this see to year. So, growth think

Nick Zangler

than I the Got I aggressive it. the gross guys that learnings more just in device And the strategy are first from actually expected. you mean, on margins pricing higher employed any quarter?

suggests as on could aggressive almost that you’ll how it just be you forward? less the level promotional you or could you harder, set press much push maybe expectations even but So and pricing, on more

Adam Townsend

at the the, say product I’d a an consumers price, amazing they great is Well, first buy give learning when you that it.

highly a side. is So, product our that volume were we growth size a We talked XX-inch went specifically That it’s and for well the a after such XX-inch great the plus does product. platform great in and product, saw We fantastic. just really us that engaged on because the about screen right? gains

be are look we those see can the and and we try paradigm where And skews other take at learnings that in that to market push going fit competitive. and so to

So, at market we’re what we about this units strategy. lineup. We for customers see We’ll gross devices. but reaction profit did consumers and dollar product a large and selling requiring the whole make surgical overall, the the immediate a manage lift what I as very sense next, it took can continue – to by at the positive to pleased said, We share. on get with and see

itself if a revenue into than historically our feeds model. dual has it it’s the margin and even proven lower strategy right had been, So

Nick Zangler

I’m just TV. Got more question my the are away through final How expansive fun introduction I’d still you it. Thanks. for ordering guys. then one And love from through my my we order e-commerce it to capabilities? of pizza phone. far

William Wang

thought I’ve years. That’s for in Since a make been we that a I smart money were really my pizza. going great of to question. TV, for waiting lot day first XX

– a fundamental more? want make in happen. blocks building Mike, that little building and capability, to we’re mobile the chime relatively experience, you because building soon, just to bit So, day is voice it’s coming the that engine, the The

Michael O’Donnell

next touched that. on excited as the for in TVs, I it about us to phase of think I to Yes, get think, video, beyond but the we’re entertainment past, extend smart we’ve for we

and to with to making we communicate is of the at future it’s about We’re need And touched obviously television. easy to to continue the hire very the on people sure but for to foundation, William as right? start bring start think television, lay that that on us, foundation

to forward will a that add new voice enhancements marketplace, our out, We capabilities. capabilities. we made voice the bring to rolling So, continued of offering. continued all to added voice mobile to will into moving have televisions – we’ve or voice our televisions We’ve majority be make

wallet. system about the excited that. foundation billing We to a So, have we’re needed and of

around We’re while launch we capability, around view, inputs? can is the product. think, How continue with still between on, we a touched that And that foundational interactivity? midsummer way to have the with to jump enhances last in good really that different notifications interactivity example notifications. consumer of that and And I move piece serve consumers track And innovate I we start HDMI how on experience. think already unique is which a to can and we

think a of So, standpoint. position good And the we’re lot on a opportunities I a foundational are from in those think horizon. I

Nick Zangler

Congrats guys. Awesome. good Thanks luck. and

Michael Marks

next you. Thank the question. take Operator will

Operator

you. Thank

Your next of Michael Guggenheim Michael, Partners. question comes go from ahead. Morris please

Michael Morris

competitive there. one afternoon, Thanks and is the have about two a questions. lot. dynamic WatchFree+ everyone. first Good I My

of the I So expense it’s of it great come from of at to you. display can see does some advertising your guess who but partners the or WatchFree+, by success

playing a just side for your you curious how you ad And picture. still be then supported thoughts how for win just partner maybe Curious thing, especially dynamic can but networks see So other valuable Mike on out, maybe of there. bigger the networks. that attention O’Donnell WatchFree+, second I’m the

we find want people an have One you is so now, sort big much feels to It’s awesome organize of there’s like guys hard of just content with continue to that what that. help you and hear right? and the sort complaints of position to

prioritize curious more of want you people might subscribe So share for some wallet, they the number economic about content a I’m Thanks. any that for but and that platforms opportunity if of to. a across organize can that maybe the helping you, is there’s

Michael O’Donnell

Yes.

question of So kind that’s it And think have marketplace. add service I customer really think think I plenty growth, going as to all significantly, there’s to Being an and customers does They that platform the that around services different competitive scale Netflix on also eyeballs for an the as I validate with subscription available in right? base. terms all think entire we’re the a in of have I services, and appetite supported of to Disney, partners appetite platform. scale dollars distribution well-positioned back for growing well the service, ad

of to generation screen. next opportunities that more over mentioned shift to standpoint editorial a cable an more also feed standpoint. I earlier, continue different think of – of for platform we’re our as channel. support revenue from a next earlier, we revenue a to question question, as we and WatchFree+ well of to I going with WatchFree+, we home on As for continue only was continue mentioned dollar to continue us, consumer but from And invest, And from not from also we are help platform I I there’s then to the partners Mike, next as think it’s continue and the can generate But on their to standpoint, we and they WatchFree+ think partners because grow our partners And a right? Discovery, as And rest viewership platform. in where an grow around pace accelerated the to continue to Search look, and WatchFree+ our sorry, but across the continue at revenue support to on we important ways multitude the us opportunities. us the it,

Michael Morris

value Its The – creation there potential exactly. for totally.

Michael O’Donnell

Look, think invest Search refining already we’re Yes. for consumers. for continue and I our to Discovery in us, we –

but I spent we continue Discovery. grow, not subscriptions our partners as in to Search well customers active to a reduce to monetizable most only as going lot best user as viewership opportunities we monetization that well continue as to user Time to for grows, to Our continue partners more as opportunities, interface, also there’s it’s for us our to eyeballs drive And increase the help includes which continue for our from we SmartCast market bring as for think WatchFree+. partners, and and or be hear of the them churn, think

Michael Marks

question. next the take we’ll Operator,

Operator

ahead. question next comes Sandler. of from Champion the line Tom Piper Your go of please Tom,

Tom Champion

the at little year. promotions, doing how responding, the if thoughts bit the two is in I’m know I’m it this looking I lot. watermark. you the stated the And TV And three Thank XQ shipments economy, the to of sequentially chart that wondering helpful. of increase you view through and low any the terms really implication talk smart mean, are the you. is consumer kind your of looks would how of expect already, years, if one don’t competitors just was in just there is last be the on I about of could a you a think the maybe kind that like deck Guys, shipments just Thanks and but

Adam Townsend

Yes, biggest a QX sure, in if sales well. the QX usually change we’re have does typically, or we’re that’s year, fairly is depending a little reset is big there Look, our throughout on back. Tom. our holiday seasonality period. QX some obviously bringing period can

a we constraints So of bit made we some the year look The is the little tricky. comps at we was, availability with. last comment over multiple periods back and dealt that

to of direction position through that Account then and sell a be strong if as single in pricing the steadily feed confident every year throughout up but exactly earlier. channels Active strategies that product year, into it’ll able lot we’ve with about strength starts shipments both because and absolutely we and are be now we’re right obviously the of and talked feel over in shipments know with to I that have will deployed, We available the our quarter, about how growth going – grow good moving this last that we to I don’t

So the comps get to start easier.

People up. year reopening doing I availability so getting in – were now marks, obviously were shifting. out ago on There period other was the things was the country there supply As dynamics lapping mentioned and prepared constraints. where we’re the the and were a

for environment an we has look rates We’re there’s from Vizio which then at time a against environment where that, a as And long standpoint, growth a have a history a marketplace in this play into know of year. value. long in now favorable the a comping with towards this gravitate challenges, We’ve brand. you strong very tend in be to describing. look that from – think being consumers we should will hand at great value that a presence. we select you’re price Consumers quality that been and that to marketplace

going quality, Obviously backdrop So still standpoint. to we’ll at will. labor working. are and so from else good priced strong we’ve inventory a a is navigate it a to inflation, strong great to everyone’s everybody The there’s hand good figure play. attractively People channel like things, how watch these but got product having out

Michael Marks

Operator, we’ll take the next question.

Adam Townsend

Thanks Tom.

William Wang

Tom. Thanks

Operator

ahead. Mohan Your Bank Wamsi from Wamsi, please next of question go America. comes of

Wamsi Mohan

you at lot double of the on be a look basis quarter-on-quarter higher new guide XQ not last did $X given Platform+ some tracking if to have? you revenues, you incremental for XQ I XQ at roughly your that; why midpoint also about initiatives the it’s On a you. about Thank year Yes. mean, And guide, you sequentially. million should

Adam Townsend

Thanks still I Yes. certainly I Wamsi. strong growth. year-over-year mean, look think it very reflects

looking and at also is we’re a sort period selling season, in come – the of at we new where of looking environment. right. the off the We’re This QX

through want have fronts then and a I demonstrate. little about the Mike terms in still come show is forth. what growth, what when and maybe from the reflects will that season year’s very around can new launches to bit look, new think which it he of last so we mentioned But strong rolls benefit and We upfront, fall and talk now more the start

it much, to [ph] going of that out. year not comes time team established earlier But well this the lose a let’s was push – where comps were Obviously We’re continue execute sight versus the the where easier. really to are periods days the team. we’ll and much see we’ll they lapping on we see the now that, more ago fact where against

we excellent growth range. but that in of context, if keep the can So achieve that midpoint

Michael O’Donnell

Yes...

Wamsi Mohan

Thanks.

go ahead Mike. Sorry

Michael O’Donnell

there’s again going No, perspective, to QX. just I add, growth I think I our good was from in think

still got on. of mentioned a we’ve I we As trajectory continue to growth our been lot that opportunities before

I we reset what kind that’s back new growth. half We we’re was as of into a new that good get Adam with of – referencing what the negotiating out coming of to we’ll upfront think now. for the front year this think the good start is commitments – opportunity

back the we’re As moves in good impact of on, half some projecting from the year this political year.

So left for year from think in the in we’re not still said we back half only time as QX, the opportunities, our second perspective, want like growth QX, well still I think positioned but this quarter. of good for But I well.

Wamsi Mohan

No, color monetizable driven I CPM growth thanks, of impressions? ad that on how of sort then appreciate any much you us in can give that. is And versus growth your growth, ARPU on

William Wang

both. say would I Yes.

I both. think is the answer

go I [indiscernible]. think think business at if around, back to years were this had, than more $X. we somewhere and you two We’ve we looking I if launched the growth when ARPU ago, we’ve you’re tripled the

where growth been – So seen what we’ve in impressions. monetizable has

We increase that. continue in an to see

than us. faster a a think spent our for at in positive I growing pace WatchFree+ overall I platform. time mentioned is That’s

leverage, the us ACR a data We our that’s continuing a to also That’s leverage about also over of talked to to advertising. function by CPMs data to solidify we as Inscape, we but higher addressable grow for we continue drive have continue of those XX%. getting average revenue advertiser CPMs relationships, through and grown function bigger deals, to

Adam Townsend

it’s and we where a is benefits would Mike’s in that, because inventory, to in drive they putting their point time disproportionally growth I we great accounts where important the would And the platform this WatchFree+ is to content really ARPU earlier, highest we’re where comments is which spend side spent really, more to just as really can just monetize add critical. the on on the doing other, WatchFree+. to about because the talked things Wamsi, to place WatchFree+ point, grow time people And into all its us best we that video the Mike. add, I Yes. relative

size the active seen. So the even growth higher those that taking of together on, the ARPU account is you’ve really driving,

Wamsi Mohan

could efforts Okay. data into the that really happened from – already Netflix probably just mean sharing to is converting password has can Thank what Thanks, color I tell crackdown quickly or please. Adam. guys is on there yet If you happen you see, time any that or WatchFree+, your is I you. that more that

Adam Townsend

for I us. if more positive wanted the saturation is supported on mean, is and that shifting. are certain that. the moving behavior people a can a is around understand that’s we while for great there’s we trend sure people And ad don’t content obviously I if they directly to know a concept Look, and really services, us. that now that’s that availability make for We’ve of in Yes. quite comment seen

mean the for highly when these tailwind reacts us. other content, distributed, some saturated content, arguably, that very have all declines streaming necessarily are we different actually So services marketplace doesn’t not of that to sampling in good consumers it’s that streaming. They’re in a ways,

Wamsi Mohan

you Thank so much. Okay.

Michael Marks

Thanks, have Operator, for we Wamsi. time more one question.

Operator

you. Thank

Vasily from Your comes please Cannonball Vasily, Karasyov question ahead. final today Research. go of

Vasily Karasyov

home profit Platform what me revenue, I streams so Plus, Good ask for and gross recognized you with kind within costs video screen to about, the revenue is, against incremental associated example, in. of on on. afternoon. understand, wanted talk for gross could squeezing are advertising different so we to what impact margin that Thank

the or Thank you like you it, of about extent talk ranking in if can? you. that, even So something can terms to them

William Wang

Yes, let a shot can me it. get, at I take

various As inventory. There’s to very they home that. – dynamics different you highest, I’d high. screen sources, own have against of So, very, somewhat our say the very We the each that them, that go is sort think about revenue right? cost of one little very

us, really highly can control you source attractive a imagine, go and that’s inventory buttons as that. against on to tremendous don’t cost have remote our for incremental So much

rev, attached those are to So obviously high margin, and they high are shipment volumes.

maybe is next the revenue some place, infrastructure’s licensing in we around Because on analytics probably rev data Our the put it. chart. once

And high off platform margin video, as contributor. a you get into good before. those, mix of share and against right on many about some our go to as rev lot have very workflows have said, it in rev is is it’s that higher then a dynamics but a have to different talked margin, very of our it video We’ve product, And platform. a structures. general, times platform are we’ve a products characteristics, on going but share We make

play But is And the inventory. off on lower install And TAM at TV. is of out going function, us terms then we I a beyond that device for uh, broader our to it we margin And side. profile. and margin, where of so a arbitrage what through more that come is that’s on resell what us about inventory. going that in video get gives go That’s a based our like to model

system. and more just to our, total to in have with don’t are be going we we entire but our, brand, what’s monetize So how homes people’s dollars about our think with our do on the ecosystem incremental to broadly, those

think margin hierarchy the profit can of deliver about you forward. we various growth dynamics will aggregate kind you the and as it, see gross that’s the play going as into So, how

Vasily Karasyov

very is this Well, helpful. you. Thank

Just follow up. quick

has revenue, correct from margin. So say be it info advertising video not gross what would that, every similar you dollar

William Wang

And depends off mixes look what where like. Yes. It occurring, That rev on is true. it’s on device, the share might partnership, device.

Vasily Karasyov

good much. thank Have a Well, you so day.

William Wang

You too. us. Thanks joining for

Michael Marks

joining. This thanks Have a great concludes call. and evening. listening everyone for today’s for Thanks

Operator

for Thank joining. you everyone

may You disconnect. now

Vizio Holding (VZIO) 13 May 222022 Q1 Earnings call transcript