Good day and thank you for standing by. Welcome to the Aterian. Inc. Fourth Quarter and Full Year 2021 Earnings Report Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference may be recorded. [Operator Instructions] I would now like to hand the conference over to your host today, Ilya Grozovsky. Your line is open – please go ahead.

Thank you for joining us today to discuss Aterian’s fourth quarter and full year 2021 earnings results. On today’s call are; Yaniv Sarig, Co-Founder and CEO; and Arturo Rodriguez, our Chief Financial Officer. A copy of today’s press release is available on the Investor Relations section of Aterian’s website at aterian.io. I would like to remind you that certain statements we will make in this presentation are forward-looking statements. And these forward-looking statements reflect Aterian’s judgment and analysis only as of today, and actual results may differ materially from current expectations based on a number of factors affecting Aterian’s business. Accordingly, you should not place undue reliance on these forward-looking statements. For a more thorough discussion of the risks and uncertainties associated with the forward-looking statements to be made in this conference call and webcast, we refer you to the disclaimer regarding forward-looking statements that is included in our fourth quarter earnings release, as well as our filings with the SEC. We do not undertake any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. In addition, the company may refer to non-GAAP metrics on this call. Explanation of these metrics can be found in the earnings release filed earlier today. With that, I will turn the call over to Yaniv.

Thank you, Ilya and thank you everyone for joining us today. I want to start by taking a minute to express Aterian’s condemnation toward the unjustified violence and bloodshed in Ukraine. Our international team includes four employees based in Ukraine currently. [Sonata Lee, DeRoss, Vislon and MacKeen] [ph], our hearts are with you and your families during the difficult times and Aterian will continue to offer any support we can provide to help. The company and many employees, including myself have made modest donations to humanitarian efforts on the ground. On the call today, I’d like to go over the following topics. I’ll start with a quick intro to Aterian for those who are newer to the story. I will then review key takeaways from Q4. I’ll go over some of the temporary challenges we’re facing due to macro level events and I’ll summarize the long-term prospects for Aterian. So those who are newer to the story, here’s what you need to know about our company. Aterian is part of a new breed of technology-enabled consumer product companies. We focus on building, acquiring and partnering with e-commerce brands online. Aterian own and operates 14 consumer brands, selling products across various categories on channels such as Amazon, Walmart, Shopify, eBay and more. To allow us to scale, we’ve invested in building our own proprietary software platform called AIMEE. AIMEE enables our team to manage our business more efficiently by injecting technology into processes that would otherwise have to be executed manually, and would require hiring an unscalable and sustainable workforce. Through its ability to analyze vast amounts of data and automate daily recurring tasks, AIMEE allows our team to find new product opportunities we can launch onto our brands, manage those products at scale effectively across various channels, and automate and…

Thanks, Yaniv and good day everyone. Here are the financial performance details of our fourth quarter. For the fourth quarter of 2021, net revenue increased 52.6% to $63.3 million from $41.5 million in the year ago quarter, primarily from an increase in net revenue from our acquisitions in organic business. The fourth quarter net revenue of $63.3 million is comprised primarily of; $31.3 million of our organic business, which I note, includes revenue from our built brands and acquired brand – brands starting one year after purchase; $27.6 million of our net revenue from our acquisitions and $4.3 million of wholesale. The year ago quarter net revenue of $41.5 million was comprised primarily of $22 million of our organic business, $14.9 million of net revenue from our acquisitions, and $4.4 million of wholesale. As a reminder, the acquisition of Smash closed on December 1st, 2020, and as a result, moved into our organic category starting December 1st, 2021. The year-over-year growth in our organic business of $9.3 million is related to, an increase in our sustained phase products of approximately $5.9 million to $25.8 million from $19.9 million due to the inclusion of Smash products into organic for the month of December offset by increased pricing of our products affected by global supply chain disruptions, which has led to the reduced sales velocity, and an impact of stopping the stimulus support from government and initial impacts from inflation affecting consumers. Our organic business also saw a slight year-over-year increase in launch phase revenue of $0.9 million to $2.6 million. As planned, due to supply chain volatility, we have won zero products this quarter compared to 5 in last year’s quarter. Overall in 2021, we launched 40 products compared to 32 in 2020. Even though the rate of our products launched…

Thank you. [Operator Instructions] And our first question comes from the line of Brian Nagel with Oppenheimer. Your line is open. Please go ahead.

Hi, good afternoon.

Good afternoon.

So a couple of questions. First off, I appreciate all the comments around the supply chain. So I guess that one question is you know what has to happen? Where does the supply chain – disruptions have to get to maybe where shipping costs, shipping rates have to get to in order for Aterian to resume a more offensive stance with regard to you know product acquisition or product introductions or even acquisitions? That’s my first question.

Yeah. Thanks, Brian. You know it’s a great question. And I think that obviously the most simplest answer is, whether we’re back in 2019, which, if you look at the prices of shipping rates from – for containers back then, right, it was a more normalized kind of like you know cost that you could trace back linearly to the previous year, whereas you know the exponential increase in cost that we saw you know as the supply chain crisis kind of unfolded, especially in 2021 right, is very challenging, right. So the second part to that, right, I mean that’s the simplest answer, if it goes back to that, obviously, amazing, right. The he question is, when is that happening? And how long will it take? And maybe the floor is a little higher, right. But when all that is said and done, I think that it will set us a new floor that is the same for everyone for all our competitors and for you know the entire economy in a way. And at that point in time, I think it should help us, right. I believe that the numbers will be closer to the 2019. Again, the really big question is, when does that happen, right.

Okay, got it. That’s you know that I guess as well as that is. And then just me on make sure I understand the mechanics. So have you not you know have really not lifted your selling prices? Because you just quoted a hit on gross margins here. So I guess to what extent have you lifted prices to offset some of these shipping costs? And I guess that second part of that would be you know was that a – is that a lever you could pull? I mean, could you start to more strategically lift prices?

So yeah, so you know I don’t have a – I don’t want to – across the Board, a number I tell you that, say on our top 50 SKUs, which you know I looked at recently, I’d say that you know approximately we lifted the prices by around 20%, I’d say in average, which remember, would that increase in price, we’re still not where we need to be at a contribution, from our contribution margin level. But you know with and what we’re seeing, if we go well beyond that you know we might start losing market share, right. That’s what we talk about when we say protecting market share, it’s finding that balancing act between a price that gives us enough margin to be profitable at the product level or the unit economic level, but also doesn’t cause us to be in a situation where we have to lose – losing market share and have an impact in the long-term, right. And so the other aspect of it is you know consumers I think are seeing those price increases everywhere from their coffee to their gas stations to you know everywhere. So that creates another obviously, challenge when it comes to generating a growth year-on-year, right. But again you know, I don’t have an exact number across the Board. But you know I’d say that around 20% increase is still not getting us to the contribution margin that we need to be in a normalized environment. So that gives you a sense I believe, right.

That’s helpful. I appreciate, Yaniv. Thank you.

Thank you, Brian.

Thank you. And our next question comes from line of Matt Koranda with ROTH Capital. Your line is open. Please go ahead.

Hey, guys. Thank you. Just maybe to start out, I understand and appreciate you know difficult environment to give an outlook. But wanted to maybe see if you could break out for the full year and ‘21, Artie, what was organic versus acquired versus wholesale revenue for the full year in ‘21? And then just maybe if you guys could speak to, should we expect organic growth I guess to continue into ‘22, just qualitatively would be helpful to get puts and takes around that so we can start to kind of build a realistic model for ‘22.

Let me speak for a second to ‘22 and I’ll pass it on to Artie to answer your first question. But yeah the answer is you know, yes, we want to drive growth in 2022, both organically and potentially, right you know obviously the world is a little chaotic right now. So we’re being a little patient, but potentially also to M&A, right. So, we’re not you know, we are a growth company, we’re also a growth company doesn’t want to grow with unit economics that are negative, right. So, we are working very hard across all dimensions of our business to achieve that. And again, the macro level will probably influence what that growth looks like. But just to be very clear you know it is our at least goal, right to do that. In terms of – part of it is also launching new products, which as we talked about earlier is also on pause right now, because it’s very important for us to have predictability when it comes to a product we launched from the moment we plan that to the moment it arrived, if we plan some product launch at a certain price point with a certain P&L, by the time it arrives, that P&L has changed by 20%, 30% you know, the launch will not be successful. So, those are the factors. But we have a lot of initiatives internally to drive growth and we are intending to drive the growth this year. Sorry, Artie I’ll pass it on to you maybe to answer the –

Yeah. Thanks. You know and Matt you’re looking for organic for the year? That was the number you’re looking for? It’s roughly $120 million.

Correct, yeah.

Yep and M&A was roughly about that. I think when you look at last year, keep in mind, that you know we had a bunch of wholesale in some M&A there. So I think the organic number was probably closer like $145 million. So that’s helpful?

Okay, yeah very helpful. Appreciate it from both you guys. And then just in terms of the pricing commentary that you made, Yaniv. I’m curious if we could dig in just a little bit more there, you said if I heard correctly, just maybe on average 20% across the top 50 SKUs. And I’m just curious why you see 20% as the ceiling? What is the behavior that you kind of see when you take price across those SKUs? Is it specifically that you start to lose market share as you kind of price above that level? Or is it just that volume declines, because demand kind of wanes there? I mean just maybe if you could unpack that a little bit more, so we can understand kind of what happens as you take price on this top SKUs?

Sure, yeah. Good – great question, Matt. And you know that 20% is an average, right. Because our - because we’re so category-agnostic and we sell things from you know a small bottle of essential oils to a commercial ice maker, the profile of our product is all over the place. But that averages is I think quite close. The answer is that you know first of all, the two are related, right. You know as you know, right in marketplaces, and in e-commerce in general, market share is a function of sales, the more you sell you know the more you will get more visibility, the more you have the potential to take on market share, the moment your sales goes down you know the advertising engine that would promote your product will take a look at your last and look more at another product, right. So there’s kind of a little bit of a, you know circular dependency almost between capturing market share and sales, that is not always as obvious now. Yes, the answer is that you know as we up the price, right, obviously, we’re pressuring the amount of sales, but also opening the door for other products to come in and take market share from us. Now, you might ask me like how is it – how come your competitors can lower their price and maybe take market share if you open the door to it? The answer is that you know a lot of other competitors not necessarily do that out of strength, they do that sometimes even out of hopelessness almost right. If you – everyone in the industry is suffering from the same problem. And so you have a lot of product that sometimes will come in and just if you throw…

Okay, that’s helpful, Yaniv. Thank you. And then just last one for me, if I could sneak one in on the margin front. You guys mentioned a near-term increase in shipping costs potentially. When would you expect that to filter through to the P&L? And then just how much margin pressure should we be kind of factor into the first quarter, second quarter of this year? It almost sounds like maybe you know relative to the fourth quarter, things remain somewhat flattish. But just any directional commentary you can provide on that to help us that would be much appreciated. Thanks.

You know, Matt I’d say we are – we became followers of some of your colleagues on the cover shipping company, and just that you know I’ve been avidly reading content online across you know publishers and analysts on shipping. And you know the comment we made is obviously related to what happened in Ukraine and obviously gas going up is not going to help. But what’s interesting is that, there are you know there’s really kind of like two opinions out there. And you know one is the obvious one that with the cost of shipping going up and all these other disruptions to supply chain, we might see you know the cost of shipping going up, but there’s actually you know some analysts who think that there’s the potential even an improvement, right. So we really are being cautious here and not necessarily saying that we know 100% that it’s going to get worse before it’s going to get better. I would bet that it’s likely. How much is a great question. And I think that you know honestly I don’t think that anyone out there, including the shipping companies can comprehend the ripple effect of what’s happening in Europe, the effect that it has on so many businesses and commodities price and oil price. So, is it going to get much worse than it’s been in the past? I hope not. I think it might just take longer for it to come down. I think that’s kind of like the – probably more likely scenario. But the world we live in, I think you know everything’s possible at this point. So very hard to tell. Sorry, but don’t have any more clear answer there. But I don’t think that anyone really does. So.

That seems fair. I’ll leave it there, guys. Thank you.

Thank you.

Thank you. And our next question comes from the line of Brian Kinstlinger with Alliance Global Partners. Your line is open. Please go ahead.

Great, thanks so much. I’m curious you mentioned some benefits by several thousand dollars per container through your new partnerships with Amazon and others. When is the first quarter you expect that P&L to get the full benefit? And how much of your containers are run through that program? Do you expect maybe first half of the year of your total?

Hey, Brian, good to hear from you. So you know the benefits of the shipping rates are always you know, call it, like a quarter later, right in average and that doesn’t even include some of the delays in shipping. And it’s not just about the cost. It’s also how long it takes to clear the port of origin, the port of arrival and many other obstacles in between including the linking lines on both sides. But you know in a way we’re already seeing the benefit of it, right. But it’s not like you know we’re back in 2019, where you know we really be in great shape if we were, I did say that you know it’s more like it could have been absolutely horrible without it, right. I can’t even imagine where our business would be if we weren’t able to navigate those – that situation and secure our preferred rates. But again, it’s still not anywhere where we can necessarily you know high-five each other and say we got you know well we’re back to where we were before, right. I think there’s more patience that need to happen before we get there. But relatively speaking to what would have happened, if we didn’t secure this, I think we’re overall in good shape if that makes sense.

Yeah. And then can you talk about how you guys are thinking about expenses? Are you thinking about cutting costs to preserve capital and weather the storm? Does the leasing capital raise lead you to hold the line in expenses in the near-term? Are you making investments just maybe some sense on some of the fixed overhead?

Artie, I’ll let you take it on.

Yeah. And I think you hit us with two. So listen with the 20 – with the $27.5 million equity raise in our credit facility, we think we’re well capitalized, where we secured the balance sheet, it’s going to allow us to weather the storm. That said, we’re constantly looking at supply chain, we’re constantly looking at our warehouse partners, our last mile partners to sort of optimize and make sure we’re driving you know as much – a much you know best margin as possible considering the circumstances. From a fixed cost perspective, we’re always looking, right now at the same time you know we still have a lot of anticipated growth long-term, like we’ve always talked about, we think we’re going to be – once we weather this so we’re not necessarily looking to cut costs. We’re just always going to be optimizing as we can from automation and other investments and systems.

Okay, thank you.

Thank you. And our next question comes from the line of Thomas Forte with D.A. Davidson. Your line is open. Please go ahead.

Great. So three sets of questions, two companies specific and one industry. So I’ll go one side at a time. So on the first one, so, Yaniv if you’re pitching this business today, March 8th, 2022, I want to know what realistic expectations for long-term success? So if e-commerce industry grows at a 15% CAGR on a very long-term basis, how do you expect the fair versus the 15%? And then how should we think about your long-term contribution margin?

Thanks, Tom, and good to hear from you. So obviously you know we’ve had a challenging you know, six months, eight months let’s say with everything that’s happening in the world. But as I mentioned also in my remarks before, I – you know couldn’t be more excited about the future. I think that you know everything we’re doing is the future of consumer product companies online. I think that you know, like us does now a lot of other groups who are seeing the potential. And all of them, including us, are just kind of focusing on weathering the storm. And really as I mentioned those earlier, right, as the dust settles and as the storm passes by, those who are sitting with a strong balance sheet and strong operational capabilities, I think will have enormous opportunity to scale, right. Yes, e-commerce is growing. You know in the US, at the Calgary we mentioned, but we definitely have over time the ambition to be a global company. And I don’t think we’re even close to scratching the surface of our ambitions. I think that we built a very strong foundation, from a team perspective, from a cultural perspective, from a systems and just expertise that we’ve built in and there’s resiliency too, right. I think a lot of companies at the end of the day, don’t make it through, because the moment they have one crisis you know things can fall apart, I have to say that you know for us, we’ve navigated so many challenges recently that it’s part of what gives me enormous confidence and our ability to really crush that when things align better, right. So, we want to go back to hyper growth. Tom you know me well enough, you know that my ambitions are huge, and that I am – I can’t wait to go back and you know, put a metal – pedal to the metal here that to scale this company. But at the same time, I think there is an element of patience that needs to happen here, there is an element of protecting what we have, allowing the storms to pass by. And then again, I think the excitement around what we do and around e-commerce should choose some back and with that, I think we’ll have enormous opportunities to scale. So, that’s how I think of it.

Great. And then second one was, I think you talked about resuming M&A. So today, March 2022, what gives you confidence in your ability to earn an appropriate return on capital from resuming M&A, given your current cost of capital?

Yeah. You know the resuming M&A is going to happen, right. The opportunity is continues to be incredible. And as I mentioned, again, in my comments, we’re not the only one seeing it, there’s a lot of capital that entered this arena, Smart Capital that – that’s going after it, and then we’re the only one on the public side so far to my knowledge that – that’s pursuing this. You know in the immediate, I think – before the war in Ukraine, I think that one of the things that we have pointed out to say that I feel confident about our reigniting M&A and there’s, again, a lot of opportunities out there was the fact that because we’re category-agnostic you know we can start looking at targets that are in categories that are not affected by the international supply chain, especially you know companies that are in the Food & Beverage and Other Consumables that are – manufactured in the US or the Americas, right. With everything that’s happening in the Ukraine you know we’re going to, again, be patient, right and do the right thing, because obviously now we’re talking about other you know commodities that are affected like wheat and other aspects of the economy that could affect even these categories, right. So, I think patience and tracking closely what’s going on the macro level is critical. But again, the opportunity is there. And we just need to be again, very clearly focused on making sure that we know when the timing is right, Tom.

All right. So thank you for that. Last one particularly you’re the one who talked about the pendulum. So the idea was and this is industry-wide question that at the beginning of the pandemic, the pendulum swung heavy toward e-commerce. Everyone was essentially in a shelter in place. And then as things started to ease, the pendulum swung back to physical stores. Can you give your current thoughts on where the pendulum lies today? There have been other e-commerce players who’ve reported their December quarter, and have talked you know their comments suggest that it’s still leaning toward physical stores. Wayfair being a good example.

Yeah, thanks, Tom. I definitely saw the Wayfair results in the comments that were made there. Yeah I think the pendulum has not yet stabilized itself, I still think – it’s still going to try to find the middle ground. I think the middle ground is, growth of e-commerce will continue to linearly like the way it used to, before the pandemic. I think we’ve seen this almost sinus wave as you said or a pendulum ride with this incredible uptick in e-commerce and strong downtick as consumers were almost kind of excited to go back to stores. But you know my best estimation right now as you know if you keep tracing a straight line on the you know path growth of e-commerce versus retail, you’ll see a very you know a normalized kind of growth there. And as I mentioned earlier, right I think that – that’s exciting, because there’s a massive amount of business out there we’re even scratching the surface of the opportunity. But beyond that, I think in other countries you might see e-commerce going faster just because of you know I mean, for example in China, right I think e-commerce is growing much faster because of access to stores that is not as you know clear as in the US, right. There’s a lot more people who have really no other choice than to use e-commerce to access certain things. And so around the world, I think that in countries like that you’ll see that growth happening faster. But there’s no doubt in my mind that, over time e-commerce will, again, continue to become a very big part of retail. And it’s very exciting for us obviously to see that happening. So, hopefully that makes sense.

Thank you, Yaniv –

Yep –

Thank you.

Thank you.

Thank you. And our next question comes from line of Marvin Fong with BTIG. Your line is open. Please go ahead.

Great. Thanks, everyone for taking my questions. Two questions, if I may. Just the first one, you know I appreciate that a lot of discussion on the shipping. And obviously you guys are doing a lot on that front. Are there any other commodity exposures that we should be thinking about? I know you have a pretty broad products that you know perhaps steel or anything like that, I know that you also said you know you’ve secured a lot of your you know, spring and summer inventory, but just in the long run, what sort of material and commodity exposure do you guys have, if anything that we should be thinking about? And then I have a follow-up.

Hey, Marvin, good to hear from you. Yeah, you know I think our manufacturers obviously are reaching out and pointing out that commodities you know prices going up, I think you know copper is probably one of the ones that you want to think about, right. A lot of the – you know a lot of the products that we sell that have electronics in them, right are affected by that. But across the Board, even plastic, right, have been in certain kind of pressure on it. So you know that definitely does trickle into the pressure that we’re seeing you know it comes from the manufacturers, they bubble it up, I think one of the things that we’re doing is being very careful to track those comments of manufacturers and their reasons that they, you know, they justify certain increases in cost of goods. And our goal is obviously to when – hopefully things that otherwise we obviously go back to them and request that – those get turned back – turned out back down, right. So yeah I mean it’s, again, it’s across the Board, right you got commodities, you got shipping internationally you know you still have the tariffs, of course, that started in 2019. And then you have last mile shipping which also is going up, given the price of gas going up. So you know in the P&L of the products across the Board there – there’s that pressure on the cost upwards. And again, we’re keeping strong track of it and looking to renegotiate those down when the environment allows us to, right.

Got you. Perfect. And then just to revisit the M&A, you know I totally appreciate you said you’d be very patient. Just expand a little more on that. I mean, what are you seeing now? Obviously we’re seeing you know some of the air coming out of valuations in the public markets? Are you seeing something similar in the aggregator space? Or is there just so much capital flowing around that you know multiples are still you know up from where they were a couple of years ago perhaps? And just maybe as a second part of that question. I mean, do you think we could you know, over time or is your discipline to kind of you know revisit and acquire things that 3 times to 4 times EBITDA versus maybe a couple of turns higher that we saw kind of towards the end of last year?

Yeah, thank you. It’s a great question. Again you know from what we know about our competitors in the private space, they’re all dealing with the same challenges. And you know none of them is immune to it, right. I think that again with our experience and better infrastructure, I think we’ll navigate it better. You know my hope is that a lot of our competitors do really well, I think it would be good for the industry and it will create more comps for us and just solidify the model, right. I definitely think that some of them might not be able to get through this. You know just like we were sitting in front of a lot of debt that was designed to kind of like you know live with the cash flows of the businesses as once the cash flows of the businesses have been contracted because of the temporary pressure on supply chain, right, that that became a problem and it’s true for them as well. So, I do think that you know although I’d say that the multiples on the acquisitions are still holding on, I do foresee that in the next few months, we’ll see a little bit of downward pressure on those multiples because of, again, some of these players that are in a situation where they can’t, you know, can’t move forward and might even have to divest the assets, right, which is part of the reason to be patient is that you know there’s a possibility that although we believe we navigated the challenges really, again, not as well as we could in a way, right, some might not be able to do it at all. And so there might be some pretty great opportunities there. I think at the end of the day, my – again it’s hard to predict exactly that the world is obviously complex today, but I think that we’ll see – my opinion, we’ll see those valuations of the businesses that are getting “aggregated” right, I believe that will stabilize around 5 times to 6 times. And with potentially, again, especially strong you know assets that could go even as high as 6 times, 7 times, right. But that’s why it doesn’t make necessary to run out and do those deals that the next few months are going to be really important to understand where the industry is going, where the valuations are going to land and you know who’s going to be standing tall and driving this forward versus who’s not, right. So, that’s why I think the patience is important.

That’s great. Thanks so much, Yaniv.

Thank you, Marvin.

Thank you. And I’m showing no further questions. And I’d like to turn the conference back over to Mr. Grozovsky for any further remarks.

Thanks, Michelle. As part of our Shareholder Perks program, which as a reminder, investors can sign up for at aterian.io/perk. Participants have the option to ask management questions on our earnings call. I wanted to thank all the Shareholder Perks’ participants for their loyalty and their participation. I’ve picked a few relevant questions that they have asked. Can you provide an update for the effort to stop the naked shorting of Aterian?

All right, Yaniv here. So thank you, Ilya. So we’re working really hard to make sure that all the trading and our shares in compliance and you know with all the rules and laws out there, the process takes a long time, we’re definitely active and investing in that. But you know, it’s going to take time to see that through. And when we have further results, we’ll report on them.

Okay, thank you. Another question we had had was, please update the – progress on platforms other than Amazon?

Yeah so I think you know one of the things that we really wanted to push forward on last year was – is international. You know, again, the supply chain crisis has slowed that down, it’s still moving forward. The big effort we’re doing now is on Walmart, I think we’ve made a lot of progress there, still a lot to do. You know Walmart is a platform that’s investing heavily in their e-commerce, but they’re still behind Amazon. And the good news is that, they seem to be making faster progress recently which allows us to obviously you know leverage the tools and the analytics that they are providing us and integrate them into AIMEE. So we’re cautiously optimistic about that becoming more valuable. The other aspect is you know we want to invest more in growth organically through D2C. So everything you know our brands have obviously, Shopify stores and we’re starting to slowly uptick the investment on scaling that correctly. Those I would say are the two kind of like biggest efforts right now, given that, again, with the supply chain, international is going to take a little longer than the shipping to Europe for example is actually even worse than to the US, because carriers prefer the US line so they make it even more expensive, and we don’t want to show up in Europe with products that are overpriced compared to the competition. So, there again, I think a little bit more patience, but again, Walmart is a big focus for us.

Great, thank you, Yaniv and thank you for participating on today’s call. In terms of the upcoming calendar, Aterian management will be participating in the 5th Annual D.A. Davidson – Consumer Growth Conference on March 10th. The fireside chat will be at 1:15 PM and will be webcast. And the 34th Annual ROTH Conference on March 13th through 15th. We look forward to speaking with you on future calls. This ends our call. You may now disconnect.

This concludes today’s conference call. Thank you for participating. You may now disconnect. Everyone have a great day.